TCR_Public/051222.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, December 22, 2005, Vol. 9, No. 303

                          Headlines

AAMES MORTGAGE: S&P's Rating on Class B Certificates Tumbles to D
ACTUANT CORP: Acquires B.E.P. Marine Limited for $8 Million
AGILENT TECH: Inks $1 Billion Term Loan for Share Purchase Program
ALLEGHENY TECH: President Elected to Ryder Board of Directors
AMERICAN PACIFIC: Earns $5.4 Mil. of Net Income in Fourth Quarter

AMSCAN HOLDINGS: Moody's Puts B3 Rating on $65 Million Facility
ASARCO LLC: Gets Final Order to Use Mitsui's Cash Collateral
ASARCO LLC: CIT Wants DIP Financing Objections Overruled
ASARCO LLC: Wants Until May 15 to Make Lease-Related Decision
ATA AIRLINES: Walks Away from Subscription Contract With WSI Corp.

ATA AIRLINES: Inks New Employment Agreement with CEO John Denison
ATHLETE'S FOOT: Clear Thinking Group Named as Liquidation Trustee
ATKINS NUTRITIONALS: Court Confirms Plan of Reorganization
AUSTIN COMPANY: Sub-Contractors Want to Foreclose Mechanics' Liens
AUTOCAM CORP: S&P Affirms Junk Rating on $140 Million Senior Notes

BEAR STEARNS: Fitch Puts Low-B Ratings on $49.9 Mil. Class Certs.
BEDROCK PRODUCTS: Case Summary & 40 Largest Unsecured Creditors
BLYTH INC: Weak Third Quarter Results Spurs S&P to Cut Ratings
BOWNE & CO: Increases Stock Repurchase Program by $75 Million
CABLEVISION SYSTEMS: Technical Default Cues S&P to Shave Ratings

CABLEVISION SYSTEMS: Scraps Plan for $1 Billion Special Dividend
CALPINE CORP.: Files for Chapter 11 Protection in S.D.N.Y.
CALPINE CORP.: Chapter 11 Case Summary
CALPINE CORP.: Summary of the Debtors' Public Debt Securities
CALPINE CORP.: List of the Debtors' 80 Largest Unsecured Creditors

CALPINE CORP: Chapter 11 Bankruptcy Filing Sparks Fitch's D Rating
CALPINE CORP: S&P's Ratings Tumble to D After Bankruptcy Filing
CAPITAL AUTOMOTIVE: Moody's Lowers Preferred Stock Rating to B1
CENTRAL WAYNE: Court Confirms Amended Plan of Liquidation
COMMUNITY HEALTH: Board Approves Repurchase of 5 Million Shares

CYBERCARE INC: Court Okays Espy as Special Collection Counsel
DELPHI CORP: Wants to Employ Price Heneveld as I.P. Co-Counsel
DELPHI CORP: Lead Plaintiffs Object to Hiring of Deloitte & Touche
DELPHI CORP: Wants to Employ Cantor Colburn as Patent Counsel
DELTA AIR: Chromalloy Gas Wants Stay Lifted to Effect Recoupment

DELTA AIR: Court Modifies Stay of Mr. Pacitti's Injury Claim
DELTA AIR: Court OKs Continuation of Terminated Employee's Appeal
DOWNTOWN RESORTS: S&P Rates Proposed $140 Mil. Senior Notes at B-
ENERGAS RESOURCES: Reaches Settlement with Double G Energy
EPICUS COMMS: Wants to Acquire Freedom Communications

FIRST INT'L: S&P Junks Ratings on Seven Class Certificates
FLOW INTERNATIONAL: Earns $2 Mil. of Net Income in Second Quarter
GE-WMC: Fitch Rates $14.9 Million Class B-5 Certificates at BB+
HEILIG-MEYERS: Court Confirms Amended Chap. 11 Liquidation Plan
HILITE INT'L: Weak Financial Performance Cues S&P's Negative Watch

INEX PHARMACEUTICALS: Stark Wants Company Declared Bankrupt
INSIGNIA SOLUTIONS: Provides Update on Nasdaq Listing Status
INTEGRATED SECURITY: Borrows $1.5M from Frost National Entities
IPCS INC: Incurs $16.3 Mil. Net Loss in Quarter Ending Sept. 30
JACOBS INDUSTRIES: Wants Court to Approve Bidding Procedures

KAISER ALUMINUM: Wants CII Carbon's Settlement Objection Overruled
KMART CORP: Asks Court for Final Decree Closing Eight Cases
KMART CORP: Settles Dispute Over Dutch Farm's $2.3 Million Claim
LA QUINTA: Launches Offers for Outstanding Debt Securities
LANCASTER REDEV'T: S&P Shaves Tax Debt Ratings to BB+ from BBB-

LB COMM'L: S&P Upgrades Rating on Class F Certificates
LEVITZ HOME: Court Denies Implementation of KERP
LEVITZ HOME: Gets Court OK to Reject Nine Store Lease Agreements
LIONEL LLC: Wants to Retain Brown Rudnick as Special Counsel
LONG BEACH: Moody's Puts Ba2 Rating on Class B-2 Sub. Certificates

MAGELLAN HEALTH: Expects to Earn $55M+ of Net Income in 2006
MAGELLAN HEALTH: Acquiring National Imaging for $122 Million
MCLEODUSA INC: New Letter of Credit Sub Limit is $23.4 Million
MCLEODUSA INC: Selects Five Members for Reorganized Board
MEDICALCV INC: Posts $712,474 Net Loss in Quarter Ended Oct. 30

MERIDIAN AUTOMOTIVE: Ct. OKs Modification of Retiree Benefits Plan
MERIDIAN AUTOMOTIVE: Panel Dismisses Suit Against Three Lenders
MIDLAND COGENERATION: Moody's Lowers $273MM Bonds' Ratings to B3
NATIONAL LAMPOON: Losses & Deficits Trigger Going Concern Doubt
NAUTILUS RMBS: Fitch Rates $19 Million Class C Notes at BB

NEWSCASTLE CDO: Fitch Rates $16 Million Class V Notes at BB
NORTHWEST AIRLINES: Wants Removal Period Extended to June 12
NORTHWEST AIRLINES: Refutes Retired Pilots Control Allegation
NORTHWEST AIRLINES: Wants Automatic Stay Enforced on Mesaba
NORTHWESTERN CORP: Harbert Hires MacKenzie to Get Votes on Merger

OMEGA HEALTHCARE: Offers to Buy Back $100 Million 6.95% Notes
OMEGA HEALTHCARE: Selling $175M Notes to Buy Back Notes & Pay Loan
ON SEMICONDUCTOR: Offering $95 Mil. of Convertible Sr. Sub. Notes
ON SEMICONDUCTOR: Expects 4% Growth in Revenues for Fourth Quarter
PHOTOCIRCUITS CORP: Deloitte Financial Approved as Fin'l Advisors

RAVEN MOON: Registers 400 Million Common Shares for Sale
RUFUS INC: Wants Exclusive Period Stretched to February 10
RURAL/METRO: Swapping $125M of Sr. Sub. Notes for Registered Bonds
RURAL/METRO: Noteholders Have Until Jan. 18 to Swap Discount Notes
SEPRACOR INC: Registers 4 Mil. Shares for Stock Plan Distribution

SERACARE LIFE: Audit Committee Conducts Internal Review
SOUTHERN UNION: Moody's Reviews Preferred Securities' Ba2 Rating
SOUTHERN UNION: Unit Inks Pact to Buy Sid Richardson for $1.6 Bil.
SUN HEALTHCARE: Looks to Raise $36 Million in Stock Offering
SUN HEALTHCARE: Acquires Peak Medical in All-Stock Deal

SUPERIOR PLUS: Acquisition Impact Earns S&P's Low-B Debt Ratings
TFS ELECTRONIC: Wants to Walk Away from Three Equipment Leases
TOM'S FOODS: 10-1/2% Noteholders Get $38 Mil. Superpriority Claim
TOWER AUTOMOTIVE: 9 Trade Creditors Sell Claims Totaling $67.6MM
TOWER AUTOMOTIVE: Deutsche Bank AG Sells $15 Mil. of 5-3/4% Bonds

TRADE AND COMMERCE: Chapter 15 Petition Summary
TRANSMONTAIGNE INC: Earnings Volatility Prompts S&P's B+ Rating
WCI STEEL: Wants Court to Okay Modifications to 2nd Amended Plan
WHEREHOUSE ENTERTAINMENT: Wants Until Jan. 13 to Object to Claims
WILLIAMS COS: Extends Tender Offer for Conv. Notes to Jan. 11

WORLDCOM INC: Court OKs Summary Judgment on Holley Clark's Claim

                          *********

AAMES MORTGAGE: S&P's Rating on Class B Certificates Tumbles to D
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class B
from Aames Mortgage Trust 2001-1 to 'D' from 'CCC'.  Concurrently,
ratings on the four other classes from the same series are
affirmed.

The rating on class B is lowered as a result of the $46,064 and
$133,235 principal write-downs realized by the class during the
October 2005 and November 2005 remittance periods, respectively.
Class B incurred its first interest shortfall during the November
2005 period.  Given the performance of this transaction to date,
Standard & Poor's does not believe it will recover the full amount
of accrued interest.

Originally rated 'BBB', class B is supported by excess interest
and overcollateralization, which has eroded steadily as net losses
have continued to exceed excess interest over the past year.
During the October 2004 distribution period, actual o/c was
approximately $1,724,027.  Monthly net losses, as a percent of
monthly excess interest cash flow, has remained severely greater
than 100% for nine of the past 12 months, resulting in the
depletion of o/c to 0.00% in the October 2005 period.  Recent
collateral performance has led to three negative rating actions
since August 2005, including this downgrade to 'D'.

As of the November 2005 distribution date, cumulative realized
losses were 6.95% of the original pool balance, while total
delinquencies were 34.22%. Serious delinquencies were 26.94%.
While the mortgage pool has paid down to approximately 13.76% of
its original balance, substantial losses have contributed to the
depletion of o/c from its original target of 3.00%.  Given the
delinquency status and performance trend, collateral performance
is expected to continue causing losses that will outpace excess
interest.  The transaction will continue to be monitored closely.

Despite poor collateral performance, the affirmations on the four
remaining classes from this transaction reflect adequate actual
and projected credit support provided by subordination and, to a
lesser extent, excess interest and o/c, if it were to rebuild.

The underlying collateral for this transaction originally
consisted of subprime fixed- and adjustable-rate first lien
mortgage loans with terms of maturity of no greater than 30 years.

                         Rating Lowered

                   Aames Mortgage Trust 2001-1

                                Rating
                       Class   To     From
                       -----   --     ----
                       B       D      CCC

                        Ratings Affirmed

                   Aames Mortgage Trust 2001-1

                       Class        Rating
                       -----        ------
                       A-1, A-2     AAA
                       M-1          AA+
                       M-2          A


ACTUANT CORP: Acquires B.E.P. Marine Limited for $8 Million
-----------------------------------------------------------
Actuant Corporation (NYSE:ATU) has purchased the outstanding stock
of B.E.P. Marine Limited for approximately $8 million plus an
earn-out tied to future earnings growth.  Funding was provided
from borrowings under Actuant's revolving credit facility.

B.E.P. Marine, based in Auckland, New Zealand, generated
approximately $10 million of sales in the last twelve months and
employs approximately 70 associates.  It maintains a leading
market position selling AC and DC control panels, digital
monitoring systems, battery switches and battery distribution
products, waterproof switch panels, and gas detectors primarily to
original equipment manufacturer boat builders and the marine
aftermarket. No other financial terms are being disclosed.

B.E.P. Marine will be part of the Actuant Recreational Group
within Actuant's Tools & Supplies segment.

Mark Goldstein, Executive Vice President of Actuant and Tools &
Supplies Segment Leader, stated, "B.E.P. Marine is a natural
addition to the Actuant Recreational Group.  While our Marinco
products provide power from the dock to the boat, and Ancor
products carry the electrical power within the boat, B.E.P.
Marine's power control panels and distribution systems manage all
electrical power on the boat.  Its innovative new product
development competencies, as well as opportunities to expand the
product lines offered by the Actuant Recreational Group, make this
an attractive acquisition for Actuant.  Ross Pratt, Mark Raines,
and Chris Wilkins, the current Directors of B.E.P. Marine, and
their team have worked hard to develop a strong brand and position
in the marketplace.  They are joining the Actuant Recreational
Group management team, reporting to Marty O'Donohue, Actuant
Recreational Group Leader."

Headquartered in Glendale, Wisconsin, Actuant Corporation --
http://www.actuant.com/-- is a diversified industrial company
with operations in over 30 countries.  The Actuant businesses are
market leaders in highly engineered position and motion control
systems and branded hydraulic and electrical tools and supplies.
Formerly known as Applied Power Inc., Actuant was created in 2000
after the spin-off of Applied Power's electronics business segment
into a separate public company called APW Ltd.  Since 2000,
Actuant has grown its sales run rate from $482 million to over
$1 billion and its market capitalization from $113 million to over
$1.4 billion.  The company employs a workforce of more than 5,000
worldwide.  Actuant Corporation trades on the NYSE under the
symbol ATU.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 2, 2005,
Standard & Poor's Ratings Services assigned its preliminary 'B+'
subordinated debt rating to Actuant Corp.'s $900 million universal
415 shelf registration.  At the same time, Standard & Poor's
affirmed its 'BB' corporate credit rating on the Milwaukee,
Wisconsin-based company.  S&P says the outlook is stable.


AGILENT TECH: Inks $1 Billion Term Loan for Share Purchase Program
------------------------------------------------------------------
Agilent Technologies Inc. (NYSE:A) has entered into a term
facility of up to $1 billion to help finance its share repurchase
program, including the repurchase for cash of approximately 83
million shares of its common stock pursuant to the modified "Dutch
auction" self-tender offer announced on Nov. 14, 2005.  Agilent
reported on Dec. 6, 2005, that there were no remaining financing
conditions to its self-tender offer.  The tender offer expired
Dec. 13, 2005, at 12:00 midnight ET.  On Dec. 14, 2005, Agilent
announced preliminary results of the tender.

Amounts borrowed under the term facility will mature within four
months or, if earlier, upon any refinancing of the term facility.
The term facility provides for a senior secured loan, subject to
satisfaction of customary conditions to borrowing, which if and
when advanced, will result in Agilent classifying up to
approximately $1.1 billion of its investments as restricted.  The
loan will bear interest, at the election of the company, at an
annual rate of either a margin of 30 basis points over one month
LIBOR for Eurodollar based borrowings, or at a rate equal to the
higher of prime and 50 basis points over the federal funds rate
for base rate borrowings.  Agilent expects to repay the loan under
the term facility through a refinancing of the facility within the
next four months.

Headquartered in Palo Alto, California, Agilent Technologies Inc.
-- http://www.agilent.com/-- is the world's premier measurement
company and a technology leader in communications, electronics,
life sciences and chemical analysis.  The company's 27,000
employees serve customers in more than 110 countries.  Agilent had
net revenue of $5.1 billion in fiscal 2005.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 28, 2005,
Moody's Investors Service affirmed the ratings of Agilent
Technologies, Inc.  The ratings outlook is stable.

These ratings were affirmed:

   * Corporate Family Rating of Ba2
   * Speculative Grade Liquidity Rating of SGL-1


ALLEGHENY TECH: President Elected to Ryder Board of Directors
-------------------------------------------------------------
Ryder System, Inc. (NYSE: R), reported that L. Patrick Hassey,
Chairman, President and Chief Executive Officer of Allegheny
Technologies Incorporated (NYSE: ATI), has been elected to its
Board of Directors.  Allegheny Technologies is one of the largest
and most diversified specialty metals producers in the world.  The
appointment of Mr. Hassey brings the number of directors on
Ryder's board to 11, all of whom are independent other than Ryder
Chairman and Chief Executive Officer Greg Swienton.

"Pat is a proven leader with more than 35 years of broad
international experience in manufacturing, engineered products,
marketing and sales," said Mr. Swienton.  "His career also
includes extensive work in key sectors such as aerospace,
automotive, industrial machinery and distribution.  We believe
Pat's industry knowledge combined with his experience as chief
executive of a leading industrial supplier of specialty materials
will enhance Ryder's ability to deliver high value to customers
and shareholders."

Mr. Hassey became President and Chief Executive Officer of
Allegheny Technologies in October 2003 and was elected Chairman in
May 2004.  Prior to joining Allegheny Technologies, Mr. Hassey had
served as an outside management consultant to Allegheny
Technologies' executive management.  Earlier, Mr. Hassey served as
Executive Vice President and a member of the corporate executive
committee at Alcoa, Inc. until the time of his early retirement in
February 2003.

Commenting on his appointment, Mr. Hassey said, "Ryder is a well
established brand that has intensified its focus over the past few
years to deliver consistently higher earnings.  I look forward to
working with fellow members of the board and Ryder's management to
build on these foundations and expand its long-term growth
potential."

Mr. Hassey is a graduate of California State University at Long
Beach and attended the University of Southern California MBA
Program.

                    About Ryder System Inc.

Ryder System, Inc -- http://www.ryder.com/-- provides leading-
edge transportation, logistics and supply chain management
solutions worldwide.  Ryder's stock (NYSE: R) is a component of
the Dow Jones Transportation Average and the Standard & Poor's 500
Index.

                About Allegheny Technologies Inc.

Headquartered in Pittsburgh, Pennsylvania, Allegheny Technologies
Inc. is a specialty stainless steel and alloy producer with fiscal
2004 steel production of 620,000 tons and revenues of $2.7
billion.

                        *     *     *

As reported in the Troubled Company Reporter on Dec 8, 2005,
Moody's Investors Service upgraded Allegheny Technologies Inc.'s
corporate family rating to Ba2 from B1 and its senior unsecured
note rating to Ba3 from B3.  In a related rating action, Moody's
upgraded Allegheny Ludlum's debentures, guaranteed by ATI, to Ba2
from B1.  The rating outlook is stable.

These ratings were upgraded:

   1. Allegheny Technologies Incorporated's Corporate Family
      Rating to Ba2 from B1

   2. Allegheny Ludlum Corporation's $150 million of 6.95%
      guaranteed debentures, due 2025, to Ba2 from B1

   3. Allegheny Technologies Incorporated's $300 million of 8.375%
      senior unsecured notes, due 2011, to Ba3 from B3


AMERICAN PACIFIC: Earns $5.4 Mil. of Net Income in Fourth Quarter
-----------------------------------------------------------------
American Pacific Corporation (Nasdaq: APFC) reported financial
results for its fiscal 2005 fourth quarter and the year ended
Sept. 30, 2005.

Revenues for the fourth quarter of fiscal 2005 were $30.3 million,
reflecting an increase of $10.2 million, or 51%, compared to last
year's fourth quarter.  Net income was $5.4 million compared to
$2.1 million during the fourth quarter of fiscal 2004.

For the 2005 fiscal year, revenues increased $23.9 million, or
40%, to $83.3 million from $59.5 million in fiscal 2004.  The net
loss for fiscal 2005 was $9.7 million compared to a net loss of
$400,000 for fiscal 2004.  The fiscal 2005 results include a non-
cash charge for environmental remediation of $14.1 million, net of
tax.

The increase in revenues during fiscal 2005, compared to the prior
year, was principally attributable to an increase in Specialty
Chemicals segment sales of $8.0 million, an increase in Other
Businesses segment sales of $3.4 million, and the fiscal 2005
acquisition of our Aerospace Equipment segment in October 2004
which contributed $12.4 million.

Specialty Chemical revenues increased in fiscal 2005 principally
due to the inclusion of a full year of operating results from our
ES packaged explosives business.  The company began consolidating
the ES results in April 2004, and as a consequence, only six
months of ES results were included in fiscal 2004.

The increase in Other Businesses segment sales resulted
principally from a $3.3 million increase in real estate sales.  In
fiscal 2005, the company completed the sale of all our Nevada real
estate that it targeted for sale.

Cost of revenues increased $15.4 million, or 38%, to $55.7 million
in fiscal 2005, from $40.2 million in fiscal 2004.  Cost of
revenues did not increase at the same rate as revenues, and as a
result, the gross margin percentage for fiscal 2005 improved to
33%, compared to 32% for fiscal 2004.  The fiscal 2005
consolidated gross margin reflects contributing factors that
either improved or decreased gross margin including:

    (i) the addition of our Aerospace Equipment segment in fiscal
        2005 which had lower gross margins,

   (ii) high gross margin contribution from our Other Business
        segment due to real estate sales, and

  (iii) consistent gross margins from the company's Specialty
        Chemicals segment.

Operating expenses increased $4.8 million, or 22%, in fiscal 2005
to $26.3 million, from $21.5 million in fiscal 2004.  The increase
in operating expenses was due primarily to:

    (i) the addition of our Aerospace Equipment segment,

   (ii) the consolidation of our ES packaged explosives joint
        venture beginning April 2004, and

  (iii) an increase in corporate development costs.

                        AFC Acquisition

In July 2005, the company entered into an agreement to acquire,
and on Nov. 30, 2005, completed the acquisition of the fine
chemicals business of GenCorp Inc. through the purchase of
substantially all of the assets of Aerojet Fine Chemicals, LLC and
the assumption of certain of its liabilities.  The assets were
acquired and liabilities assumed by the company's newly formed,
wholly-owned subsidiary, Ampac Fine Chemicals.  AFC is a
manufacturer of active pharmaceutical ingredients and registered
intermediates under cGMP guidelines for customers in the
pharmaceutical industry.  Its facilities in California offer
specialized engineering capabilities including high containment
for high potency compounds, energetic and nucleoside chemistries,
and chiral separation using the first commercial-scale simulated
moving bed in the United States.

The total estimated consideration for the AFC Business is $131.7
million, comprised of:

    Cash                                            $88.5 Million
    Fair value of Seller Subordinated
     Note (Face value $25.5)                        $19.4 Million
    Preliminary capital expenditures
     adjustment                                     $17.4 Million
    Preliminary working capital
     adjustment                                      $2.4 Million
    Other direct acquisition costs                   $4.0 Million

      Total purchase price                         $131.7 Million

The purchase price is subject to adjustment based on post-closing
analyses of capital expenditures and working capital.  The
purchase price may also be adjusted for an additional contingent
cash payment of up to $5.0 million based on targeted performance
of the AFC business during fiscal 2006.  The acquisition was
funded using net proceeds of $83.3 million from the company's
Credit Facilities, a $25.5 million Seller Subordinated Note, and
existing cash.

                 Liquidity and Capital Resources

Cash provided by operating activities was $19.2 million and $1.4
million during the fiscal years 2005 and 2004, respectively.  The
principal reason for the increase in operating cash flow is due to
normal fluctuations in the company's accounts receivable balances,
which may vary significantly based on the timing of shipments of
our Specialty Chemicals products.  Cash used in investing
activities during fiscal 2005 includes capital expenditures of
$2.1 million, an increase of $1.0 million from fiscal 2004, and
cash used for the acquisition of our Aerospace Equipment segment
in October 2004 of $4.5 million.

                        Credit Facilities

In connection with the company's acquisition of AFC, the company
entered into:

    * a $75 million first lien credit agreement and
    * a $20 million second lien credit agreement.

The Credit Facilities are collateralized by substantially all of
the company's assets and the assets of its domestic subsidiaries.
The first lien credit facility includes a $10 million revolving
credit line.  The Credit Facilities contain, among other
provisions, financial covenants, events which require prepayment
of debt and restrictions on asset sales, additional debt or liens,
issuance of equity, and dividends.

                    Seller Subordinated Note

In addition, the company entered into a Seller Subordinated Note
for $25.5 million, which is subordinated to the Credit Facilities
and certain of its other debt and contains certain terms and
restrictions.

American Pacific Corp. -- http://apfc.com/-- is a specialty
chemical company that produces energetic products used primarily
in space flight and defense systems, automotive airbag safety
systems and explosives, Halotron, a clean fire extinguishing agent
and water treatment equipment.  In November 2005, American Pacific
acquired the former Aerojet Fine Chemicals business.  Ampac Fine
Chemicals, as it is now known, is a leading manufacturer of active
pharmaceutical ingredients and registered intermediates under cGMP
guidelines for commercial customers in the pharmaceutical
industry, involving high potency compounds, energetic and
nucleoside chemistries, and chiral separation.  In 2004 American
Pacific acquired the former Atlantic Research Corporation liquid
in-space propulsion business.  Ampac-ISP, as it is now known, is a
leading supplier of commercial and military propulsion products
and the world's largest producer of bipropellant thrusters.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 5, 2005,
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Las Vegas, Nevada-based American Pacific Corp.
The outlook is negative.

At the same time, Standard & Poor's assigned a 'B' bank loan
rating and its recovery rating of '2' to American Pacific's
proposed $75 million senior secured first-lien credit facility,
based on preliminary terms and conditions.  The rating on the
first-lien bank loan is the same as the corporate credit
Rating.  This and the '2' recovery rating indicate that bank
lenders can expect a substantial recovery of principal in the
event of a payment default.

In addition, Standard & Poor's assigned its 'CCC+' rating and a
recovery rating of '5' to the proposed $20 million second-lien
term loan.  The second-lien facility is rated two notches below
the corporate credit rating due to the level of priority debt
ahead of the loan that limits recovery prospects.  The '5'
recovery rating indicates negligible recovery of principal.


AMSCAN HOLDINGS: Moody's Puts B3 Rating on $65 Million Facility
---------------------------------------------------------------
Moody's Investors Service upgraded the proposed first lien senior
secured credit facilities being raised by Amscan Holdings, Inc. to
finance its acquisition of Party City Corporation.  The ratings
upgrade reflects a $95 million reduction in first lien term loan
borrowings since the initial transaction rating in November, due
to an incremental $30 million equity contribution and the addition
of a $65 million second lien senior secured term loan.  Moody's
assigned a B3 rating to the second lien facility.  Amscan's
current bank facilities, corporate family rating, and senior
subordinated notes remain on review for possible downgrade pending
the close of the acquisition.  At that time, Moody's expects to
downgrade Amscan's corporate family rating to B2, to lower its
senior subordinated notes rating to Caa1, and to withdraw existing
senior secured ratings.  The ratings outlook is anticipated to be
stable.

The prospective rating downgrade reflects the weakened financial
profile expected to result from the high-priced and majority debt-
financed acquisition, which heightens risks associated with:

   * the timely realization of synergies;
   * the retention of non-Party City customers; and
   * the stabilization of Party City sales and profits.

These risks are moderated in part by:

   * the sensible combination of the leading vendor and
     specialty retailer in the relatively stable party
     supply market; and

   * by the company's well-considered:

     -- synergy,
     -- customer retention, and
     -- operational strategies.

These ratings were affected:

   * $65 million second lien senior secured eight-year term
     loan facility, assigned at B3;

   * $85 million senior secured six-year revolving credit
     facility, upgraded to B1 from B2; and

   * $325 million (formerly $420 million) senior secured
     seven-year term loan facility, upgraded to B1 from B2.

These ratings remain on review for possible downgrade:

   * Corporate family rating (formerly senior implied rating), B1;

   * $50 million senior secured revolving credit facility
     due 2010, B1;

   * $205 million senior secured term loan B facility
     due 2012, B1; and

   * $175 million 8.75% senior subordinated notes due 2014, B3.

The upgrade of Amscan's proposed first lien credit facilities
reflects the meaningfully improved enterprise value coverage due
to reduced facility size.  Further, Moody's recognizes their
predominant position in the pro forma capital structure, as
supported by operating subsidiary guarantees and by asset and
capital stock pledges by Amscan and its subsidiaries.  The B3
rating on the second-lien facilities reflects their effectively
subordinated position in the capital structure, due to their
second-priority security interests behind the still large first-
lien debt class and their customary, but limited rights and
remedies under terms of the proposed inter-creditor agreement.

In September 2005, Amscan entered into an agreement to purchase
Party City for approximately $362 million.  The transaction is
expected to close by year-end.  Although the acquisition price
represents a substantial multiple of Party City's trailing twelve-
month EBITDA, the impact on Amscan's financial leverage is
moderated by an approximate $162 million equity investment by:

   * Berkshire Partners,
   * Weston Presidio, and
   * management.

Further, Moody's recognizes the strategic benefits that may result
from the business combination, including the potential for
incremental sales of Amscan product into Party City's owned and
franchised stores.

Nonetheless, the transaction will leave Amscan with a vulnerable
financial profile.  The company's high leverage and limited near-
term debt repayment prospects heighten the execution risks
surrounding the acquisition, including:

   1) realizing sales and cost related synergies in the expected
      magnitude and timeframe;

   2) maintaining stabilized sales and profit trends at Party City
      under new ownership and management, and with retention of
      key personnel;

   3) managing important non-Party City retail relationships in
      order to minimize any potential customer/sales losses; and

   4) maintaining distinct operating controls between the retail
      and wholesale businesses to eliminate potential conflicts.

While management has sensible strategies to address these
concerns, the company will be challenged to return to its
historical credit metrics in the near-term even under flawless
execution, and could face unforeseen challenges or adverse market
developments.  In this last regard, Moody's notes Party City's
historical volatility in terms of:

   * store growth, comparable store sales, and profitability;

   * the potential for higher energy costs to limit discretionary
     spending or customer traffic;

   * Amscan's exposure to higher raw material or distribution
     costs;

   * the risk of incremental category participation by mass
     retailers, direct sellers, and other specialty chains; and

   * the potential for heightened competition.

Notwithstanding these concerns, the prospective rating levels and
stable outlook also reflect the expectation that Amscan will
realize substantial synergies through the business combination and
begin to meaningfully reduce leverage by fiscal 2007.  Moody's
view is supported by the substantial product overlap of Amscan's
existing product portfolio with Party City's non-Amscan SKU.

Further, Moody's notes Amscan's stable historical operating
performance, and the generally moderate risks in party supply
categories related to cyclicality, seasonality, or fads.  The
company's product breadth, balloon license portfolio, design
capabilities, and cost efficiency have made it a valuable partner
for its superstore customers, many of which may be reluctant to
switch vendors (particularly smaller independent chains).

Lastly, the ratings are supported:

   * by Party City's clear leadership and recognition in the party
     superstore channel;

   * by the recent comparable sales gains as the company has
     improved its merchandising, layouts, and promotional
     offerings; and

   * by the convenience, selection, and value offered by the
     superstores relative to mass retailers and other competitors.

Upward rating pressure is unlikely over the coming year due to the
time needed to successfully execute sales and cost synergy plans,
but could develop over the longer-term if planned profit and cash
flow gains are achieved such that the company maintains debt-to-
EBITDA below 6.0x, EBIT-to-interest over 1.5x, and free cash flow
in mid-single digits as a percentage of debt (all ratios including
Moody's standard adjustments).  Similarly, while Amscan has a
moderate cushion at existing rating levels for near-term execution
or operational challenges, sustained profit erosion or negative
cash flow would likely pressure the ratings.  In particular,
ratings could be downgraded if leverage exceeds 7.25x or if
Amscan's liquidity becomes constrained in any way.

Amscan Holdings, Inc., with executive offices in Elmsford, New
York, is a leading manufacturer of party goods and the largest
manufacturer of metallic balloons.  The company sells its products
through party superstores, party goods retailers and other retail
distribution channels.  Party City Corporation, with headquarters
in Rockaway, New Jersey, currently operates more than 500 company-
owned and franchised party goods stores in the United States and
Puerto Rico.  For the twelve-month period ended September 2005,
the combined companies had pro forma revenues of around $875
million and pro forma EBITDA of approximately $100 million,
excluding the synergies expected to be generated by the
acquisition.


ASARCO LLC: Gets Final Order to Use Mitsui's Cash Collateral
------------------------------------------------------------
As reported in the Troubled Company Reporter on Aug. 15, 2005,
Judge Schmidt of the U.S. Bankruptcy Court for the Southern
District of Texas granted ASARCO LLC authority to use its cash
collateral on an interim basis.

The Court directs ASARCO to deposit $1,280,000 of proceeds of
Mitsui & Co. (U.S.A.), Inc.'s collateral in a newly established
separate segregated bank account.

                        Court Ruling

In an agreed final order, the Court grants ASARCO LLC's use of
cash collateral in limited circumstances.

Judge Schmidt rules that ASARCO will maintain the proceeds of
Mitsui & Co. (U.S.A.), Inc.'s collateral in trust for its benefit
in a separate segregated bank account established under the first
interim cash collateral order.

ASARCO will continue to allocate the proceeds to silver inventory
in the same way that it has done previously as it sells,
delivers, or disposes of its Copper Inventory.

As soon as proceeds of Mitsui's Collateral are received, ASARCO
will promptly deposit those proceeds into Mitsui's Cash
Collateral Account.

ASARCO agrees that it will not use any portion of Mitsui's
Cash Collateral as long as ASARCO has sufficient funding to meet
its operating needs under the provisions of the Court-approved
DIP Financing Agreement.

In the event that ASARCO has exhausted the DIP Availability and
needs the use of Mitsui's Cash Collateral to enable its
operations and to avoid immediate irreparable harm, ASARCO may
request the use of Mitsui's Cash Collateral subject to each of
these conditions precedent:

   (a) Unless shortened by the Bankruptcy Court, ASARCO must
       provide at least five days' prior written notice to
       Mitsui, the ASARCO Committee, the Subsidiary Committee,
       Robert Pate, the Future Claims Representative, The CIT
       Group and each of their counsel of any request of a
       hearing seeking authority to use Mitsui's Cash Collateral.

   (b) ASARCO must provide a budget providing for the use of
       Mitsui's Cash Collateral that is reasonably acceptable
       to Mitsui or approved after notice and hearing by the
       Court.

   (c) ASARCO must provide adequate protection that is either
       acceptable to Mitsui in its sole discretion of its
       interest in Mitsui's Cash Collateral.

   (d) ASARCO must be in full compliance with the Agreed Order.

Judge Schmidt further rules that ASARCO will not use any of
Mitsui's Cash Collateral other than in accordance with the
Approved Budget.

With respect to adequate financing protection, ASARCO has not
agreed to provide replacement liens or any other adequate
protection at present time.

To the extent the Court finds that the protections afforded in
Mitsui's Cash Collateral are inadequate, Mitsui will be entitled
to a superpriority administrative expense claim under Sections
503(b) and 507(a)(1) and (b) of the Bankruptcy Code.

Judge Schmidt declares that the terms and provisions of the
Agreed Order will survive entry of any order that may be entered
converting to Chapter 7 or dismissing ASARCO's bankruptcy case.

Likewise, Judge Schmidt vacates and modifies the automatic stay
to permit Mitsui and ASARCO to implement the Agreed Order.

The Agreed Order will expire one year after the Petition Date at
5:00 p.m., unless earlier terminated or otherwise extended in a
writing signed by ASARCO and Mitsui.

A full-text copy of the Agreed Cash Collateral Order is available
for free at:

   http://bankrupt.com/misc/asarcocashcollateralfinalorder.pdf

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company.  Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent.  The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 215/945-7000).


ASARCO LLC: CIT Wants DIP Financing Objections Overruled
--------------------------------------------------------
As reported in the Troubled Company Reporter on Sept. 23, 2005,
ASARCO LLC sought authority from the U.S. Bankruptcy Court for the
Southern District of Texas to enter into an agreement with The CIT
Group/Business Credit, Inc., for $75,000,000 in postpetition
financing.

To secure all obligations under the DIP Facility, ASARCO will
grant The CIT Group a first priority lien on substantially all of
ASARCO's assets, excluding insurance proceeds arising from or
payable as a result of personal injury claims, and subject to
agreed upon carve-outs for the United States Trustee and the
Debtors' and Creditors Committee's professionals.  No costs or
expenses of administration will be imposed against the collateral.

            CIT Group Replies to Section 506(c) Issue

On behalf of CIT Group/Business Credit, Inc., Josiah M. Daniel,
III, Esq., at Vinson & Elins L.L.P., in Dallas, Texas, relates
that the proposed Final DIP Financing Order includes a provision
that "[Section 506(c) of the Bankruptcy Code] is not applicable
to the DIP Facility, the Collateral, and the DIP Agent and the
DIP Lenders."

Mr. Daniel tells Judge Schmidt that "the challenged provision is
perfectly appropriate because Section 506(c) is applicable only
to prepetition secured claims, not to postpetition credit
extended under Section 364 by a pure postpetition lender," like
the CIT Group, which has no prepetition claim against ASARCO.

Assuming arguendo that Section 506(c) could ever be applicable to
the CIT Group, Mr. Daniel asserts that the arguments presented by
the United States Government and the Texas Commission on
Environmental Quality is without merit.  Courts have held that a
debtor-in-possession or a trustee may waive a Section 506(c)
claim for recovery of administration expenses from collateral.

Mr. Daniel contends that upholding a Chapter 11 debtor's waiver
of potential Section 506(c) recoveries accords with sound
bankruptcy policy.  "The success of most Chapter 11 cases hinges
on the debtor-in-possession's ability to secure postpetition
financing," he says.  "However, postpetition lenders are
unwilling to make a risky loan to a distressed debtor unless the
lender is granted a claim superior to other claims."

In enacting Sections 364(c) & (d), the U.S. Congress provided
postpetition lenders with both priming liens and superpriority
claims.  If, as the U.S. Government and the Texas Commission are
essentially urging, a governmental agency can later assert a
"super-super-priority" claim that arises years later and trumps a
postpetition lender's reliance on the postpetition lien and the
superpriority previously granted under Section 364, then the
assurance Congress provided in enacting Section 364 would be
"nugatory," and lenders would be less willing to enter into
postpetition financing agreements with financially distressed
debtors, Mr. Daniel explains.

Mr. Daniel further contends that any attempt by an administrative
claimant to assert a Section 506(c) recovery would be a futile
act since that recovery would be for the estate and not for the
particular governmental entity.  This futility, Mr. Daniel
attests, emphasizes that Section 506(c):

   -- can only be used by the estate;

   -- does not establish a new priority scheme in favor of
      governmental entities like the U.S. Government and the
      Texas Commission; and

   -- may properly be waived by ASARCO.

Accordingly, the CIT Group asks Judge Schmidt to overrule the DIP
Financing objections and approve DIP Financing on a final basis.

                   Court Approves CIT Financing

The Bankruptcy Court authorizes ASARCO LLC, on a final basis, to
obtain up to $75,000,000 financing pursuant to a senior secured
revolving line of credit facility with The CIT Group/Business
Credit, Inc.  The financing includes a $50,000,000 letter of
credit subfacility.

The loan amount may be increased to up to $150,000,000, at
ASARCO's option, in accordance with the terms of the DIP
Financing Agreement and subject to the DIP Agent receiving
satisfactory collateral audits, appraisals, and title and lien
reports with respect to a supplemental asset component.

To secure the prompt payment and performance of any and all
obligations, liabilities, and indebtedness of ASARCO under the
DIP Facility, Judge Schmidt grants valid and automatically
perfected security interests and liens to CIT Group in all of
ASARCO's right, title, and interest in all of the real and
personal properties and assets of ASARCO's estate.  The DIP Liens
will be:

   (i) valid, enforceable, non-avoidable, first-priority,
       perfected security interests and liens, superior to any
       and all other creditors and interest holders of ASARCO,
       in and on all the Collateral that is not otherwise
       encumbered by a Prior Lien on the Petition Date;

  (ii) valid, enforceable, non-avoidable, second-priority,
       perfected security interests and liens on all the
       Collateral that is subject only to a Prior Lien; and

(iii) valid, enforceable, non-avoidable, perfected, priming
       security interests and liens that are superior to the
       security interests and liens, if any, of Gerald Metals,
       Inc., in inventory owned by ASARCO.

With respect to equipment leased to ASARCO, the DIP Liens will
attach only to ASARCO's right, title, and interest in that
equipment if certain leases are true leases.  In the event any
lease is determined to be a secured transaction and the lessor is
determined to hold a perfected and non-avoidable pre-Petition
Date security interest, the DIP Liens will be junior in priority
to a security interest in that equipment.

Furthermore, the DIP Liens will not attach to:

   (a) the KWELM insurance proceeds currently held in an escrow
       account at Wells Fargo Bank, National Association,
       pursuant to an Escrow Agreement dated July 8, 2005, among
       ASARCO, Capco Pipe Company, Inc., Lac d'Amiante du Quebec,
       Ltd., and the Official Committee of Unsecured Creditors in
       the Subsidiary Debtors' Chapter 11 cases;

   (b) ASARCO's right, title, and interest in and to any other
       insurance payment or proceeds arising from or payable as
       a result of asbestos-based personal injury claims for
       which ASARCO or its subsidiaries have liability;

   (c) ASARCO's right, title, or interest in the claims or
       causes of action against certain persons that arise from
       facts alleged in certain motions filed in Adversary
       Proceeding No. 05-2048 by the Subsidiary Debtors'
       Committee and the Future Claims Representative in the
       Subsidiary Debtors' Cases;

   (d) any right of indemnification or contribution of ASARCO to
       collect from entities, if any, that are liable to ASARCO
       on a claim against ASARCO if the claim arises as a
       consequence of a payment that is made to a PI claimant
       on account of any asbestos-related liability other than
       entities that owe an Account or are critical vendors to
       ASARCO;

   (e) ASARCO's notes received in connection with sales of
       business divisions, which receivables have been issued to
       ASARCO for paying costs for environmental remediation or
       asbestos claims;

   (f) inventory owned by any person and provided to ASARCO
       pursuant to tolling agreements or arrangements with
       ASARCO;

   (g) any and all proceeds of an AMC Note received by ASARCO
       until the time as ASARCO has performed all of its payment
       obligations to the Coeur d'Alene Tribe pursuant to the
       settlement agreement dated January 31, 2003; and

   (h) the Avoidance Claims.

The DIP Liens will be free from any application of Section 551 of
the Bankruptcy Code.  In the event the estate were to avoid any
Prior Lien, the DIP Liens will automatically succeed to the
priority of that avoided Prior Lien with respect to all property
of the estate to which that Prior Lien had attached.

In addition, Judge Schmidt grants CIT Group and the DIP Lenders
superpriority claims, pursuant to Section 364(c)(1) of the
Bankruptcy Code, over all other claims against ASARCO other than
claims seeking payment out of the Carve-Out or from the Excluded
Collateral.

Judge Schmidt directs ASARCO to pay the DIP Agent promptly for
all reasonable fees, expenses and costs of financial advisors and
professionals currently employed in connection with the DIP
Facility.

Judge Schmidt further declares that all DIP Financing objections,
which were not withdrawn, are overruled in their entirety.

A full-text copy of the Final DIP Order is available for free at:

        http://bankrupt.com/misc/asarcofinaldiporder.pdf

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company.  Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent.  The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 215/945-7000).


ASARCO LLC: Wants Until May 15 to Make Lease-Related Decision
-------------------------------------------------------------
C. Luckey McDowell, Esq., at Baker Botts L.L.P., in Dallas,
Texas, informs the U.S. Bankruptcy Court for the Southern District
of Texas in Corpus Christi that ASARCO LLC operates a Mission Mine
in Arizona substantially on Native American Indian lands that are
leased from the Tohono O'Odham Nation San Xavier District and
certain individual members of the Nation who hold trust patent
allotments of the land.

ASARCO operates the mine on those lands pursuant to federal
regulations imposed by the U.S. Department of the Interior Bureau
of Land Management and Bureau of Indian Affairs.

To make an informed decision about whether to reject or accept
the Indian Leases, Mr. McDowell asserts that it is critical that
ASARCO ascertain the expenditures that would be necessary to
satisfy the federal regulations, including those that require
ASARCO to reclaim environmentally the Mission Mine.

In that regard, ASARCO has previously submitted to the BLM and
BIA:

   (i) a proposed Mine Plan of Operations which includes a
       reclamation plan for the Mission Mine;

  (ii) a request for clarification concerning which federal
       regulations would actually govern the mine reclamation
       and how those regulations would be applied to ASARCO;
       and

(iii) federal Freedom of Information Act requests to review
       the BLM's and BIA's records to better understand the
       agencies' regulatory posture toward ASARCO with respect
       to the Mission Mine.

Mr. McDowell notes that ASARCO submitted the proposed MPO and
reclamation plan to the BLM and BIA on May 17, 2005.  Until the
BLM and BIA provide some meaningful feedback concerning the
proposal, it is unclear what reclamation obligations may be
imposed on ASARCO for the Mission Mine.

ASARCO has also invited the BLM and BIA on several occasions over
the past year to clarify which federal regulations will govern
the Mission Mine reclamation effort and how those regulations
would be applied to ASARCO.  As of Dec. 16, 2005, the BLM and
BIA have yet to provide meaningful clarification, although
ASARCO's latest request for clarification, submitted to the BLM
on Nov. 16, 2005, is reportedly under consideration.  How the
BLM and BIA answer ASARCO's requests for regulatory clarification
could mean a difference of tens of millions of dollars in
reclamation obligations being imposed for the Mission Mine, Mr.
McDowell says.

Furthermore, ASARCO has submitted to the BLM and BIA several
FOIA requests over the past year to review both agencies'
administrative records concerning the Mission Mine.  To date, the
BLM and BIA have yet to provide ASARCO access to review any of
the requested records, which include documents that reveal the
agencies' position on the types of reclamation obligations that
may apply to the Mission Mine, as well as documents concerning
another, reportedly much more costly reclamation plan previously
proposed by third parties to be considered for approval in lieu
of ASARCO's proposed reclamation plan.

In the absences of meaningful feedback, clarification and a
substantive response from BLM and BIA, Mr. McDowell contends that
it will be impossible for ASARCO to make an informed business
decision whether to reject or accept the Indian Leases.

The Debtors also continue to be parties to a number of non-
residential real property leases.  According to Mr. McDowell, the
Debtors are current on all of their postpetition obligations
under the Leases.

Against this backdrop, the Debtors ask the Court to extend the
time to make their determinations to assume or reject non-
residential real property leases through May 15, 2006, pursuant
to Section 365(d)(4) of the Bankruptcy Code.

The Debtors assure Judge Schmidt that they will remain current
on all of their postpetition obligations under the Leases until
those Leases are assumed or rejected.

Mr. McDowell tells Judge Schmidt that since the Debtors have
focused their efforts on various demands inherent in large
reorganization cases, including responding to a just-ended labor
strike, obtaining DIP financing, and developing a viable
reorganization plan, the Debtors have been unable to accurately
evaluate and weigh the benefits or burdens to their estates of
assuming or rejecting the Leases.

"Absent such an evaluation, the Debtors would be unable to
articulate factors sufficient to make the required showing to the
Court that [they] have exercised reasonable business judgment in
determining whether to assume or reject the Leases," Mr. McDowell
asserts.

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company.  Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent.  The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 215/945-7000).


ATA AIRLINES: Walks Away from Subscription Contract With WSI Corp.
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
gave ATA Airlines, Inc., and its debtor-affiliates permission to
reject the Net Subscription Agreement effective on the date notice
of the rejection is served to WSI Corporation.

As previously reported in the Troubled Company Reporter on
October 27, 2005, the Debtors and WSI Corporation are parties to a
Net Subscription Agreement, effective November 1, 2005, pursuant
to which WSI provided the Debtors with access to its Internet
Aviation Weather Briefing Services for 48 months.  The system
allows the Debtors' employees to view worldwide weather data.
The Debtors agreed to pay $1,000 per month for the first two years
and $1,600 per month thereafter.

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. 43; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ATA AIRLINES: Inks New Employment Agreement with CEO John Denison
-----------------------------------------------------------------
ATA Holdings Corp. and its principal operating subsidiary, ATA
Airlines, Inc., entered into a new employment agreement with John
Denison as president and chief executive officer of both Holdings
and ATA on December 1, 2005.

The New Employment Agreement supercedes and replaces in its
entirety the employment agreement entered into with Mr. Denison on
October 20, 2005.  The New Employment Agreement was entered into
solely to address certain potential deferred compensation issues
under Section 409A of the Internal Revenue Code.  All other
substantive provisions of the New Employment Agreement are the
same as the Old Employment Agreement.

Under the Agreement, Mr. Denison's annual base salary will be a
nominal amount of $350,000.  However, consistent with salary
reductions taken by other executives, ATA will pay him a reduced
base salary of $280,000 a year unless and until the parties agree
to a different amount.

ATA will review the Base Salary on an annual basis to determine
any appropriate annual increase, based on considerations like the
Executive's performance, market compensation conditions, the
company's financial performance and inflation.

Mr. Denison is also eligible to earn annual incentive bonus
compensation.  The amount of the incentive bonus compensation, if
any, will be determined at the discretion of the Board of
Directors of Reorganized ATA, with Mr. Denison not participating
in the determination.

The annual incentive compensation will target 50% to 125% of Mr.
Denison's Base Salary and will be based on a combination of the
achievement by the company of performance goals established by the
Reorganized ATA's Board prior to the start of the calendar year
for which the bonus is being determined, as well as the Board's
assessment of his performance as president and CEO.

The first annual incentive bonus compensation will be considered
in January 2007, relating to performance during calendar year
2006.  Reorganized ATA also will consider in January 2008, an
incentive bonus for Mr. Denison relating to performance during
calendar year 2007, notwithstanding that the term of Mr.
Denison's employment is to end at December 31, 2007.

The Agreement also provides for a severance package in the event
Mr. Denison's employment is terminated.

The Agreement is subject to approval of the Bankruptcy Court.

A full-text copy of Mr. Denison's employment agreement with ATA is
available at no charge at http://ResearchArchives.com/t/s?3e2

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. 43; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ATHLETE'S FOOT: Clear Thinking Group Named as Liquidation Trustee
-----------------------------------------------------------------
Clear Thinking Group, LLC and Joseph E. Myers, a partner and
managing director in the firm, have been appointed liquidation
trustee for athletic shoe retailer Athlete's Foot Stores, LLC.
The appointment became effective with the confirmation of the
company's Chapter 11 Plan of Reorganization by the U.S. Bankruptcy
Court for the Southern District of New York.

Under terms of the engagement agreement, staff from Clear
Thinking's Creditors Rights Practice will take all actions
consistent with the duties and responsibilities of the liquidation
trustee, as outlined in the Liquidation Trust Agreement.  Such
actions will include, but not be limited to, administering the
disbursement of funds contained in a liquidated assets trust from
which Athlete's Foot Stores will pay its administrative and
general unsecured claims.

                About Clear Thinking Group

Clear Thinking Group -- http://www.clearthinkinggrp.com/--  
provides a wide range of strategic consulting services to retail
companies, consumer product manufacturers/distributors and
industrial companies. The national advisory organization
specializes in assisting small- to mid-sized companies during
times of growth, opportunity, strategic change, acquisition, and
crisis.

             About Athlete's Foot Stores LLC

Headquartered in New York, New York, Athlete's Foot Stores, LLC
-- http://www.theathletesfoot.com/-- operates approximately
125 athletic footwear specialty retail stores in 25 states.  The
Company and its debtor-affiliate filed for chapter 11 protection
on December 9, 2004 (Bankr. S.D.N.Y. Case No. 04-17779).  Bonnie
Lynn Pollack, Esq., and John Howard Drucker, Esq., at Angel &
Frankel, P.C. represents the Debtors in their restructuring
efforts.  When the Company filed for protection from its
creditors, it listed total assets of $33,672,000 and total debts
of $39,452,000.


ATKINS NUTRITIONALS: Court Confirms Plan of Reorganization
----------------------------------------------------------
The Honorable Allan L. Gropper of the U.S. Bankruptcy Court for
the Southern District of New York confirmed, December 21, Atkins
Nutritionals, Inc.'s Amended Plan of Reorganization.

The Company expects to emerge from bankruptcy by Jan. 9, 2006.

A new ANI management team has implemented a fundamental change in
strategy to dramatically improve ANI's financial performance.  ANI
has transitioned into a functional food marketer -- offering
great-tasting, nutritionally superior Atkins Advantage bars and
ready-to-drink shakes to the broad adult population of active men
and women seeking to improve their overall health and wellness.

This is a shift from ANI's previous strategy of educating
consumers about the benefits of a controlled-carbohydrate diet.

To support its new focus on portable, convenient and nutritious
food products, ANI has optimized its supply chain, simplified its
business systems and is strengthening its consumer and customer
relationships.  In the past six months, ANI has streamlined its
offerings to focus on the successful Atkins Advantage line of
nutrition bars and shakes, which are packed with essential
nutrients -- high protein, fiber, vitamins, minerals, low sugar
and no trans fats.  ANI has also improved the taste, freshness and
overall quality of its products.

"The new Atkins Advantage line represents an uncompromising
commitment to quality, nutrition and taste, and will be embraced
by consumers making smart food choices," President and Chief
Executive Officer Mark S. Rodriguez said. "Our new line of
Advantage Caramel Cookie Dough Bars and Caramel Fudge Brownie Bars
is simply the first example of this new
mission."

                       Amended Plan

As previously reported, the Amended Plan provides for a
restructuring of the Debtors' financial obligations that will
result in a significant deleveraging of the Debtors and a
downsized operation to better meet reduced market demand.

On the Effective Date of the Plan, Reorganized Atkins Holdings is
authorized to issue the New Common Stock without the need for any
further corporate action and without any further action by holders
of Claims or Equity Interests.

The New Common Stock, which will be subject to dilution by the New
Management Interests, will consist of 15 million authorized shares
of Reorganized Atkins Holdings, 10 million of which will be issued
and distributed to the holders of Allowed First Lien Claims and
Allowed Second Lien Claims pursuant to Article IV of the Plan.

The remainder of the authorized New Common Stock will be reserved
for future purposes, as determined by the Board of Reorganized
Atkins Holdings, consistent with its New Organizational Documents.

                Treatment of Claims and Interests

The Plan groups claims and interests into six classes.

Impaired claims consist of:

   1) First Lien Claims, totaling approximately $216.4 million
      will receive the Ratable Proportion of the New Tranche A
      Senior Notes and 8,400,000 shares of the New Common Stock;

   2) Second Lien Claims, totaling approximately $18 million will
      receive the Ratable Proportion of 1,600,000 shares of the
      New Common Stock and the New CVR Interests pursuant to the
      New CVR Agreement executed by the New CVR Agent;

   3) General Unsecured Claims, totaling approximately $91
      million will not receive or retain any property or interest
      in property on account of those Claims; and

   4) Old Equity Interests will be cancelled and the holders of
      Old Equity Interests will not receive or retain any
      property or interest in property on account of those
      Interests.

Unimpaired claims consist of:

   1) Priority Non-Tax Claims, totaling approximately $40,000
      will be paid in full, in cash with post-petition interest;
      and

   2) Other Secured Claims, totaling approximately $718,000 and
      at the sole option of the Debtors after consultation with
      the Pre-Petition Agent or the Reorganized Debtors will be:

      a) reinstated or be paid in full in cash, together with
         post-petition interest, or

      b) satisfied by the surrender of the underlying collateral
         or otherwise rendered unimpaired in accordance with
         Section 1124 of the Bankruptcy Code, or

      c) accorded other appropriate treatment, including deferred
         cash payments as consistent with Section 1129(b) of the
         Bankruptcy Code, or

      d) paid on other terms as the Debtors and the holders of
         Other Secured Claims may agree upon.

A full-text copy of the Disclosure Statement and Amended Joint
Plan is available for a fee at:

   http://www.researcharchives.com/bin/download?id=051006002916

Headquartered in New York, New York, Atkins Nutritionals, Inc.
-- http://atkins.com/-- sells nutritional supplements under the
Atkins Advantage brand to fit the needs of all healthy, active
lifestyles.  The Company, along with Atkins Nutritionals Holdings,
Inc., Atkins Nutritionals Holdings II, Inc., and Atkins
Nutritionals (Canada) Limited, filed for chapter 11 protection on
July 31, 2005 (Bankr. S.D.N.Y. Case No. 05-15913).  Marcia L.
Goldstein, Esq., at Weil Gotshal & Manges LLP, represents the
Debtors in the United States, while lawyers at Osler, Hoskin &
Harcourt, LLP, represent the Debtors in Canada.  As of May 28,
2005, they listed $265.6 million in total assets and $323.2
million in total debts.


AUSTIN COMPANY: Sub-Contractors Want to Foreclose Mechanics' Liens
------------------------------------------------------------------
Mark One Electric Company, Inc., Rosehill Gardens, Inc., Diaz
Construction Company, Inc., and A. Zahner Company ask the U.S.
Bankruptcy Court for the Northern District of Ohio, Cleveland
Division, to lift the automatic stay in the Austin Company's
bankruptcy case so they can foreclose on their mechanics' liens.

The four sub-contractors want the Debtors to pay what it owed them
for work and materials provided at The Kansas City Star newspaper
production facility in Missouri.  Cypress Media, LLC, the owner of
the Kansas facility, is not a debtor in this proceeding.

The sub-contractors are owed:

              Company                  Amount
              -------                  ------
              Mark One               $970,717
              Rosehill Gardens         17,199
              Diaz Construction        55,982
              A. Zahner               115,693
                                   ----------
              Total                $1,159,591

The Debtor has -- improperly, the Four Sub-Contractors suggest --
scheduled each of the sub-contractors as general, unsecured, non-
priority creditors.

The sub-contractors want the stay lifted so they can initiate and
prosecute an action to foreclose on their liens against the Kansas
facility.  Under the Missouri law, the contractor, Austin Company,
is a necessary party to a sub-contractor's action to foreclose its
mechanic's lien.

The sub-contractors assure the Court that foreclosing on the
facility won't, in any way, affect the administration of the
Debtor's case, and distribution to the estate's creditors.

Headquartered in Cleveland, Ohio, The Austin Company is an
international firm offering a comprehensive portfolio of in-house
architectural, engineering, design-build, construction management
and consulting services.  The Company also offers value-added
strategic planning services including site location,
transportation and distribution consulting, and facility and
process audits.  The Company and two affiliates filed for
chapter 11 protection on Oct. 14, 2005 (Bankr. N.D. Ohio Case No.
05-93363).  Christine M. Pierpont, Esq., at Squire, Sanders &
Dempsey, LLP, represents the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they estimated between $10 million to $50 million in
total assets and debts.


AUTOCAM CORP: S&P Affirms Junk Rating on $140 Million Senior Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services revised the recovery rating on
Autocam Corp.'s $104 million senior secured credit facilities to
'2' from '4' and affirmed the 'CCC+' rating on this senior debt.

At the same time, Standard & Poor's affirmed its 'CCC+' corporate
credit rating on Autocam and the 'CCC-' debt rating on Autocam's
$140 million unsecured senior subordinated notes.

The rating actions follow Autocam's announcement that it intends
to issue $75 million of second-lien senior secured term loan debt.
Proceeds from the issue will be used to pay down the first-lien
revolving credit facility and term loan.  In addition, the company
will amend its senior secured credit facility to ease the
near-term covenants.

Kentwood, Michigan-based Autocam is a designer and manufacturer of
high-volume, precision-machined specialty metal alloy components
for high-technology automotive applications.  With the proposed
transaction, the company's pro forma total balance sheet debt as
of Sept. 30, 2005, would be $291 million.

"The recovery rating revision reflects the planned reduction in
the amount of first-lien senior secured debt that will be
outstanding following the transaction and amendment," said
Standard & Poor's credit analyst Nancy C. Messer.  "The rating
affirmations reflect Standard & Poor's view that Autocam's
very vulnerable financial position will not materially worsen or
improve as a result of the proposed transaction."

Proceeds from the new term loan will be used to pay down
borrowings under the existing revolving credit facility, to
partially repay existing euro and U.S. dollar term loans on a pro
rata basis, and to provide balance sheet cash.  In the next 12
months, Autocam's financial position will remain very vulnerable
to negative developments in the currently unstable environment for
automotive suppliers, as the company suffers from limited
liquidity, from a lack of near-term free cash flow, and from weak
credit protection measures.

Revenues were weak for the first nine months of 2005, declining
4.3% on a constant-dollar basis.  The loss of certain European
business with two customers accounted for $12.6 million of the
sales reduction.

In addition, weak production volumes followed the phaseout of a
European fuel injector program with yet another customer.  In
North America, lower production volumes at all of the Detroit-
based original equipment manufacturers, especially General Motors
Corp. (B/Negative/B-3), depressed revenues.  Globally, price
reductions reduced sales by $4.5 million in 2005.

The ratings reflect Autocam Corp.'s very aggressive leverage and
vulnerable business profile.

Autocam makes products for the automotive sector, which represents
95% of its sales.  These products include components for
power-steering systems, as well as fuel injectors, electric
motors, airbags, and brakes.  Privately held Autocam is controlled
by owners GS Capital Partners 2000 L.P., Transportation Resource
Partners L.P., and company president John Kennedy.


BEAR STEARNS: Fitch Puts Low-B Ratings on $49.9 Mil. Class Certs.
-----------------------------------------------------------------
Bear Stearns Commercial Mortgage Securities Trust, series
2005-PWR10 commercial mortgage pass-through certificates are
rated by Fitch Ratings:

     -- $118,500,000 class A-1 'AAA';
     -- $139,400,000 class A-2 'AAA';
     -- $59,400,000 class A-3 'AAA';
     -- $171,000,000 class A-AB 'AAA';
     -- $1,049,504,000 class A-4 'AAA';
     -- $305,771,000 class A-1A 'AAA';
     -- $263,368,000 class A-M 'AAA';
     -- $2,633,679,672 class X-1* 'AAA';
     -- $2,563,817,000 class X-2* 'AAA';
     -- $210,695,000 class A-J 'AAA';
     -- $19,752,000 class B 'AA+';
     -- $29,629,000 class C 'AA';
     -- $23,045,000 class D 'AA-';
     -- $16,460,000 class E 'A+';
     -- $26,337,000 class F 'A';
     -- $26,337,000 class G 'A-';
     -- $29,629,000 class H 'BBB+';
     -- $26,337,000 class J 'BBB';
     -- $36,213,000 class K 'BBB-';
     -- $3,292,000 class L 'BB+';
     -- $9,876,000 class M 'BB';
     -- $13,168,000 class N 'BB-';
     -- $6,585,000 class O 'B+';
     -- $6,584,000 class P 'B';
     -- $9,876,000 class Q 'B-';

*Notional Amount and Interest Only

The $32,921,672 class S is not rated.

Classes A-1, A-2, A-3, A-AB, A-4, A-1A, A-M, A-J, B, C, D, E, and
F are offered publicly, while classes X-1, X-2, G, H, J, K, L, M,
N, O, P, Q, and S are privately placed pursuant to rule 144A of
the Securities Act of 1933.  The certificates represent beneficial
ownership interest in the trust, primary assets of which are 212
fixed-rate loans having an aggregate principal balance of
approximately $2,633,679,672 as of the cutoff date.

For a detailed description of Fitch's rating analysis, please see
the report titled 'Bear Stearns Commercial Mortgage Securities
Trust 2005-PWR10' dated Dec. 2, 2005 available on the Fitch
Ratings Web site at http://www.fitchratings.com/


BEDROCK PRODUCTS: Case Summary & 40 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: BedRock Products, LLC
             20041 Leitchfield Road
             Leitchfield, Kentucky 42754

Bankruptcy Case No.: 05-61960

Debtor affiliate(s) filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Rock & Load, LLC                           05-61959

Chapter 11 Petition Date: December 16, 2005

Court: Western District of Kentucky (Louisville)

Judge: Joan L. Cooper

Debtor's Counsel: David M. Cantor, Esq.
                  Seiller Waterman LLC
                  462 South 4th Street, Suite 2200
                  Louisville, Kentucky 40202-3445
                  Tel: (502) 584-7400

                           Estimated Assets      Estimated Debts
                           ----------------      ---------------
BedRock Products, LLC      $500,000 to           $1 Million to
                           $1 Million            $10 Million

Rock & Load, LLC           $50,000 to            $500,000 to
                           $100,000              $1 Million

A. BedRock Products, LLC's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
SBA                                                     $639,264
2120 Riverfront Drive,
Suite 100
Little Rock, AR 722021794

Chase                            Assets                 $600,000
c/o Mark Sandlin                 Value of security:
601 W. Main Street               $540,000
Louisville, KY 402022976

KEDFA Fund B                                            $269,617
c/o J P Morgan Trust Co
614 West Main Street,
Suite 2600
Louisville, KY 40202

Chase                                                   $170,000

Lincoln Trail Area Development                           $90,000

Capital One FSB                                          $14,789

MBNA Mastercard                                          $11,055

Commonwealth of Kentucky                                 $10,789

Insight Media                                            $10,227

Amtech LC                                                 $7,421

Ameriglobe FIBC Solutions                                 $4,425

Breckinridge County Sheriff                               $3,651

Kentucky State Treasurer                                  $3,644

Ohio Casualty Group                                       $3,375

Redtree Creative                                          $3,000

Kentucky Department of Revenue                            $2,576

The Web Guys Inc.                                         $2,500

Middle TN Natural Gas Utility                             $2,424

Hectus & Strause PLLC                                     $2,331

Lee Masonry Products LLC                                  $1,353

B. Rock & Load, LLC's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
James Welding Services, Inc.                            $157,871
2399 New Hope Road
Bedford, KY 40006

Bank One                         Real property          $152,259
P.O. Box 9001022                 Value of security:
Louisville, KY 402901022         $60,000

Bank One                         Real property           $82,717
P.O. Box 94015                   Value of security:
Palatine, IL 600944015           $60,000

U.S. Bank                                                $14,264

Cardmember Service                                       $10,608

Citibusiness Card                                        $10,052

Capital One, FSB                                          $9,352

American Express                                          $7,024

Cardmember Service                                        $6,784

Capital One Bank                                          $5,774

Capital One Bank                                          $5,742

AT&T Universal Card                                       $4,930

AT&T Universal Card                                       $4,698

Capital One Bank                                          $4,275

MBNA America                                              $4,206

Retail Services                                           $3,583

Home Depot Credit Service                                 $2,769

Wells Fargo Financial Bank                                $2,731

Breckinridge County Sheriff                                 $946

Office Depot Credit Card Plan                               $757


BLYTH INC: Weak Third Quarter Results Spurs S&P to Cut Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit,
senior unsecured bank loan, and senior unsecured debt ratings on
Blyth Inc. to 'BB' from 'BB+'.  These ratings remain on
CreditWatch with negative implications, where they were placed
Aug. 25, 2005, following weaker-than-expected performance for the
second fiscal quarter ended July 31, 2005.

Ratings were subsequently lowered by one notch on Sept. 19, 2005,
following the company's announcement that its board had
unanimously approved a tax-free spin-off of its wholesale group to
Blyth shareholders.  CreditWatch with negative implications means
that the ratings could be affirmed or lowered following the
completion of Standard & Poor's review.

"The downgrade follows the company's continued weak operating
performance through its third fiscal quarter, ended
Oct. 31, 2005," said Standard & Poor's credit analyst David Kang.

Net sales for the quarter increased 1% from the same quarter in
the previous year due to the addition of Edelman and Euro-D,cor,
but operating income declined about 34%, to $33.7 million from
$51 million.  This follows a 43% drop and a 50% drop in operating
income during the first and second fiscal quarters of 2005,
respectively.  The decline in operating performance during the
third quarter, which is typically the beginning of the company's
key selling season, was due largely to lower volume in the
company's North American PartyLite direct selling business,
increased freight surcharges, and substantial increases in
commodity costs, such as paraffin wax.  The U.S. remains a
difficult market for PartyLite, and direct sellers face
increasingly challenging conditions from recent entrants into the
direct selling market.

In addition, higher gas prices and inflation have reduced the
discretionary income of Blyth's target consumer.  S&P remains
concerned about the recovery prospects for this business, as well
as the company's ability to stem this continued decline in
profitability.

Blyth announced that it expects to receive a ruling from the IRS
relating to certain aspects of its proposed tax-free spin-off of
its wholesale segment to Blyth's shareholders.  However, the
company has indicated that management has paused its immediate
efforts to complete the spin-off while it evaluates additional
strategic opportunities that have been identified since the
company's announcement of the spin-off.

Although S&P has considered the spin-off of the wholesale business
as neutral to the current ratings, the ratings remain on
CreditWatch pending the completion of the company's strategic
review.  In S&P's opinion, this review creates further
uncertainties about the future direction of the company.  S&P will
continue to monitor developments and will meet with management to
discuss the company's business strategy, future capital structure,
and financial policy before resolving the CreditWatch listing.

Greenwich, Connecticut-based Blyth manufactures and markets
scented and unscented candles, potpourri, and portable
heating-fuel products sold under the Colonial, PartyLite, and
Sterno brands.


BOWNE & CO: Increases Stock Repurchase Program by $75 Million
-------------------------------------------------------------
Bowne & Co., Inc.'s (NYSE: BNE) Board of Directors has authorized
an increase of $75 million to its previously announced stock
repurchase program.

Under the stock repurchase program authorized in December 2004,
the Company has repurchased approximately 5 million shares of its
common stock for approximately $72 million, leaving approximately
$2.5 million remaining under its existing share repurchase
authorization.  Under the revised repurchase program as approved
by the Board, an additional $75 million in shares of the Company's
common stock may be repurchased from time to time in both
privately negotiated and open market transactions during a period
of up to two years, subject to management's evaluation of market
conditions, terms of private transactions, applicable legal
requirements and other factors.

Approximately $15 million of this repurchase program is expected
to be acquired under a Rule 10b5-1 trading plan.  Rule 10b5-1
allows a company to purchase its shares at times when it otherwise
might be prevented from doing so under insider trading laws or
because of self-imposed trading blackout periods.  Purchases will
be effected by a broker and will be based upon the guidelines and
parameters of the 10b5-1 plan.

There is no guarantee as to the exact number of shares that will
be repurchased under the stock repurchase program, and the Company
may discontinue purchases at any time.  Repurchased shares would
be returned to the status of authorized but un-issued shares of
common stock.

Founded in 1775, Bowne & Co., Inc. -- http://www.bowne.com/-- is
a global leader in providing high-value solutions that empower its
clients' communications.  Bowne & Co. combines its capabilities
with superior customer service, new technologies, confidentiality
and integrity to manage, repurpose and distribute a client's
information to any audience, through any medium, in any language,
anywhere in the world.

                         *     *     *

Bowne & Co.'s 5% convertible subordinated notes due Oct. 1, 2033,
carry Moody's Investors Service's and Standard & Poor's single-B
ratings.


CABLEVISION SYSTEMS: Technical Default Cues S&P to Shave Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term ratings
on Bethpage, New York-based cable TV operator Cablevision Systems
Corp.  The long-term corporate credit rating is lowered to 'BB-'
from 'BB'.  All other long-term ratings, including those of
related entities, also were lowered.  All long-term ratings were
placed on CreditWatch with developing implications.  The 'B-2'
short-term rating, however, which was not lowered, remains on
CreditWatch with developing implications.

"These downgrades follow Cablevision's 8K filing that it
ascertained that there were certain technical covenant violations
under intermediate holding company CSC Holdings, Inc.'s existing
bank credit agreement and certain possible technical covenant
violations under other debt instruments," said Standard & Poor's
credit analyst Catherine Cosentino.  It also indicated that it is
in the process of completing a comprehensive covenant compliance
review, seeking waivers under its bank credit agreement and, if
necessary, seeking waivers under its other debt instruments.  In
addition, with the delay in receipt of new financings, the company
has yet to address the $1.5 billion June 2006 maturity on the CSC
Holdings' credit facility.

The placement on CreditWatch developing reflects the prospect that
if Cablevision successfully resolves the technical covenant
violations under the CSC Holdings bank agreement and/or other debt
indentures, then the ratings could be raised, given the
fundamental strength of the company's cable TV operations, which
have performed very well and continue to have favorable business
prospects, largely because of the attractive demographics of the
company's overall markets.

The upgrade potential would be limited to one notch and would
focus on financial strategies and procedures for addressing
covenant compliance.  Conversely, if necessary waivers are not
obtained and/or the company does not address the refinancing of
the 2006 maturity in a timely manner, the rating may be lowered
further.

At the same time, S&P withdrew the 'B+' rating on CSC Holdings
Inc.'s $1 billion of proposed senior notes due 2015, and the 'BB+'
rating on CSC Holdings Inc.'s proposed $4.5 billion secured bank
loan facilities.


CABLEVISION SYSTEMS: Scraps Plan for $1 Billion Special Dividend
----------------------------------------------------------------
Cablevision Systems Corporation disclosed that during the course
of preparing for the financing of its proposed special dividend,
it ascertained that there were certain technical covenant
violations under CSC Holdings, Inc.'s existing bank credit
agreement and certain possible technical covenant violations under
other debt instruments.

As reported in the Troubled Company Reporter on Dec. 15, 2005, the
Company's Board of Directors authorized its management to take all
steps that would be necessary to implement a $3 billion special
dividend payable pro rata to all shareholders subject to, among
other things, obtaining the necessary financing on terms and
conditions acceptable to the Board and final Board approval after
completion of its ongoing analysis of the proposed dividend.

The Company and CSC Holdings was evaluating a new CSC Holdings,
Inc. credit facility of up to $5.5 billion, secured by the stock
of certain subsidiaries.  The new credit facility would:

   (1) be used to refund and replace the existing CSC Holdings,
       Inc., credit facility;

   (2) provide the funds for the special dividend, if one is
       declared by the Board; and

   (3) provide for up to $1 of initially undrawn revolving credit
       availability.

The Company is in the process of and intends promptly to complete
a comprehensive covenant compliance review, seek waivers under its
bank credit agreement and, if necessary, seek waivers under its
other debt instruments and consider the impact of such potential
covenant violations on the classification of debt in its prior
financial statements.

As a result of these matters, on December 18, 2005, the Company's
Board of Directors decided not to proceed with the proposed
special dividend.  The recently announced senior note offering
will not proceed.

Cablevision Systems Corporation -- http://www.cablevision.com/--  
is one of the nation's leading entertainment, media and
telecommunications companies.  In addition to its cable, Internet,
and voice offerings, the company owns and operates Rainbow Media
Holdings LLC and its networks; Madison Square Garden and its
teams; and, Clearview Cinemas.  In addition, Cablevision operates
New York's Radio City Music Hall.

As of Sept. 30, 2005, Cablevision's equity deficit narrowed to
$2.54 billion from a $2.63 billion deficit at Dec.31, 2004.


CALPINE CORP.: Files for Chapter 11 Protection in S.D.N.Y.
----------------------------------------------------------
In order to allow continued operations at its power plants and
facilities in the U.S., Canada, and Mexico, strengthen its balance
sheet, protect its assets, and enhance the value of its business,
the company and many of its subsidiaries, including Calpine
Generating Company, LLC, Calpine Corporation (OTC Pink Sheets:
CPNL) filed voluntary petitions to restructure under Chapter 11 of
the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the
Southern District of New York in Manhattan Tuesday night.

Certain of Calpine's direct and indirect subsidiaries and
affiliates in Canada intend to file for creditor protection under
the Companies' Creditors Arrangement Act.

In conjunction with the filing, Calpine has received commitments
for up to $2 billion of secured debtor-in-possession financing
from Deutsche Bank and Credit Suisse First Boston, joint lead
arrangers and joint bookrunners.  The financing includes a
$1 billion revolving credit facility and a $1 billion term loan.
Upon Court approval, the financing, combined with cash from
operations, will be used to fund post-petition operating expenses,
including employee and supplier obligations.

Calpine emphasized that normal operations will continue during the
restructuring process.  "Our plan calls for power plants to remain
available for operation to provide reliable supplies of
electricity," said Robert P. May, Calpine's Chief Executive
Officer.  "We intend to move through this restructuring process as
quickly as possible to regain our financial health and to take the
necessary steps to become a stronger and more competitive energy
provider.  With our new financing we will have additional
financial flexibility and sufficient liquidity to meet our
obligations going forward."

"We believe that Calpine needs to change its business model in
light of the ongoing evolution of competitive power markets and
our current financial condition," Mr. May said.  "Although the
company has taken numerous steps to reduce its debt and strengthen
its balance sheet through asset sales and other means, these
actions were not sufficient to offset the cost of Calpine's
substantial debt obligations.

"After careful consideration of all available alternatives,
Calpine's Board of Directors determined that a Chapter 11 filing
was a necessary and prudent step and the best way to obtain the
financing necessary to maintain regular operations, and allow for
a successful restructuring," Mr. May said.  "Calpine has a strong
foundation in place, with high quality assets and a professional
and experienced workforce.  Chapter 11 protection will provide us
with the ability to address our financial challenges without
disrupting our ability to continue to provide reliable power
supplies to the markets in which we operate."

As a routine matter, Calpine has asked the Court for authorization
to continue paying employee wages and salaries, providing benefits
without interruption, and expects the Court to grant that request.
During the restructuring process, Calpine will continue to
evaluate all opportunities to strengthen its balance sheet and
enhance operating cash flow, including asset sales and reductions
in operating and overhead costs.

In addition, Calpine has petitioned the court to reject certain of
its contracts, including power sales agreements in which the price
paid to Calpine for electricity is significantly below its cost or
market prices.  The company expects its power plants will continue
to be available to meet the needs of electricity consumers in all
of its service areas.

The Chapter 11 filing does not affect the tender offer to purchase
up to $400 million of the outstanding 9-5/8% First Priority Senior
Secured Notes due in 2014 that commenced on December 1, 2005.  As
previously announced, the Offer will remain open until 12:00
midnight, New York City Time, on December 29, 2005, unless
extended or earlier terminated.

The company has established a toll-free restructuring information
line for employees, suppliers, customers, investors and other
interested parties, 1-866-504-6370.  More information on Calpine's
restructuring is also available on the company's web site at
http://www.calpine.com/

For access to Court documents and other general information about
the Chapter 11 cases, please visit http://www.kccllc.net/calpine

A major power company, Calpine Corporation supplies customers and
communities with electricity from clean, efficient, natural gas-
fired and geothermal power plants.  Calpine owns, leases and
operates integrated systems of plants in 21 U.S. states and in
three Canadian provinces.  Its customized products and services
include wholesale and retail electricity, gas turbine components
and services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services.  Calpine was founded in 1984.



CALPINE CORP.: Chapter 11 Case Summary
--------------------------------------
Lead Debtor: Calpine Corporation
             50 West San Fernando Street
             San Jose, California 95113

Bankruptcy Case No.: 05-60200

Debtor affiliate(s) filing separate chapter 11 petitions:

   Case No.  Debtor Entity
   --------  -------------
   05-60199  Calpine Kennedy Operators, Inc.
   05-60201  Calpine Administrative Services Company, Inc.
   05-60202  Calpine Power Company
   05-60203  Calpine Fuels Corporation
   05-60204  Calpine Finance Company
   05-60205  Calpine International Holdings, Inc.
   05-60206  Calpine Operations Management Company, Inc.
   05-60207  Calpine Energy Holdings, Inc.
   05-60208  Calpine Energy Services Holdings, Inc.
   05-60209  CPN Energy Services GP, Inc.
   05-60210  CPN Energy Services LP, Inc.
   05-60211  Calpine PowerAmerica, Inc.
   05-60212  Calpine PowerAmerica, LP
   05-60213  Calpine PowerAmerica - CA, LLC
   05-60214  Calpine PowerAmerica - CT, LLC
   05-60215  Calpine PowerAmerica - MA, LLC
   05-60216  Calpine PowerAmerica - ME, LLC
   05-60217  Calpine Producer Services, LP
   05-60218  CES GP, LLP
   05-60221  Calpine Capital Trust V
   05-60222  Calpine Energy Services
   05-60223  Amelia Energy Center,LP
   05-60224  Bellingham Cogen Inc.
   05-60225  Bethpage Energy Center 3, LLC
   05-60226  Anacapa Land Company, LLC
   05-60227  Calpine Freestone Energy GP, LLC
   05-60228  Bethpage Fuel Management Inc.
   05-60229  CalGren Finance Corp.
   05-60230  Calpine Freestone Energy, LP
   05-60231  Calpine Freestone, LLC
   05-60232  Anderson Springs Energy Company
   05-60233  Calpine Cogeneration Corporation
   05-60234  Calpine Gas Holdings
   05-60235  Blue Heron Energy Center LLC
   05-60236  CalGren Project Equipment Finance Company One, LLC
   05-60237  Calpine Generating Company, LLC
   05-60238  Blue Spruce Holdings, LLC
   05-60239  Androscoggin Energy, Inc.
   05-60240  Calpine Gilroy 1, Inc.
   05-60241  Calpine Gilroy 2, Inc.
   05-60242  Broad River Energy LLC
   05-60243  Calpine Gilroy Cogen, LP
   05-60244  Auburndale Peaker Energy Center, LLC
   05-60245  Broad River Holding, LLC
   05-60246  Calpine Global Services Company, Inc.
   05-60247  Calpine Corpus Christi Energy GP, LLC
   05-60248  Augusta Development Company, LLC
   05-60249  CalGen Equipment Finance Company, LLC
   05-60250  Calpine c* Power, Inc.
   05-60251  CalGen Equipment Finance Holdings, LLC
   05-60252  Aviation Funding Corp.
   05-60253  CalGen Expansion Company, LLC
   05-60254  Calpine Decatur Pipeline, L.P.
   05-60255  Baytown Energy Center, LP
   05-60256  Baytown Power GP, LLC
   05-60257  Calpine East Fuels, Inc.
   05-60258  Baytown Power, LP
   05-60259  CalGren Project Equipment Finance Company Three, L
   05-60260  Calpine Construction Management Company, Inc.
   05-60261  Calpine Corpus Christi Energy LP
   05-60262  CalGren Project Equipment Finance Company Two, LLC
   05-60263  Calpine Decatur Pipeline Inc.
   05-60264  Calpine Dighton, Inc.
   05-60265  Calpine Acadia Holdings, LLC
   05-60266  Calpine Eastern Corporation
   05-60267  CCFC Development Company, LLC
   05-60268  Calpine Agnews, Inc.
   05-60269  CCFC Equipment Finance Company, LLC
   05-60270  Calpine Amelia Energy Center GP, LLC
   05-60271  CCFC Project Equipment Finance Company One, LLC
   05-60272  Calpine Amelia Energy Center LP, LLC
   05-60273  Celtic Power Corporation
   05-60274  CGC Dighton, LLC
   05-60275  Channel Energy Center, LP
   05-60276  Channel Power GP, LLC
   05-60277  Channel Power LP
   05-60278  Clear Lake Cogeneration Limited Partnership

Chapter 11 Petition Date: December 20, 2005

Court: United States Bankruptcy Court
       Southern District of New York
       Alexander Hamilton Custom House
       One Bowling Green
       New York, NY 10004-1408
       Telephone (212) 510-0500
       http://www.nysb.uscourts.gov

Judge: The Honorable Burton R. Lifland

Debtors' Counsel: Richard M. Cieri, Esq.
                  Matthew A. Cantor, Esq.
                  Edward Sassower, Esq.
                  Robert G. Burns, Esq.
                  KIRKLAND & ELLIS LLP
                  Citigroup Center
                  153 East 53rd Street
                  New York, NY 10022-4611
                  Telephone (212) 446-4800
                  Fax (212) 446-4900
                  http://www.kirkland.com

Members of the
Prepetition
First-Lien
Committee:        Unknown

Counsel to the
Prepetition
First-Lien
Committee:        Steven B. Levine, Esq.
                  BROWN RUDNICK
                  One Financial Center
                  Boston, MA 02111

Members of the
Prepetition
Second-Lien
Committee:        AIG
                  Contrarian Fund
                  Franklin
                  Angelo Gordon
                  Lehman
                  Oaktree
                  Avenue Capital
                  Marking Shields

Counsel to the
Prepetition
Second-Lien
Committee:        Andrew Rosenberg, Esq.
                  PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP
                  1285 Avenue of the Americas
                  New York, NY 10019-6064

U.S. Trustee:     Deirdre A. Martini, Esq.
                  United States Trustee for Region II
                  U.S. Department of Justice
                  Office of the United States Trustee
                  33 Whitehall Street, 21st Floor
                  New York, NY 10004-2111
                  Telephone (212) 510-0500
                  Fax (212) 668-2255
                  http://www.usdoj.gov/ust/r02

Financial Condition at December 19, 2005:

     Total Assets: $26,628,755,663

     Total Liabilities:  $22,535,577,121


CALPINE CORP.: Summary of the Debtors' Public Debt Securities
-------------------------------------------------------------
Calpine Corp. and its debtor-affiliates included a quick-reference
chart outlining the multiple layers of their secured and unsecured
debt securities in their first-day papers delivered to the
Bankruptcy Court.  A free copy of that Schedule is available at:

     http://bankrupt.com/misc/CalpinePubliclyHeldSecurities.pdf



CALPINE CORP.: List of the Debtors' 80 Largest Unsecured Creditors
------------------------------------------------------------------
Contemporaneously with the filing of their petitions, Calpine
Corporation and its debtor-affiliates delivered a list of their
80 largest unsecured creditors, on a consolidated basis, to the
U.S. Bankruptcy Court in Manhattan.  Calpine's Top 80 List is
based on the Debtors' books and records as of approximately
December 19, 2005.  The Top 80 List was prepared in accordance
with Rule 1007(d) of the Federal Rules of Bankruptcy Procedure.
The Top 80 List does not include: (1) persons who come within the
definition of "insider" set forth in 11 U.S.C. Sec. 101; or (2)
secured creditors, unless the value of the collateral is such that
the unsecured deficiency places the creditor among the holders of
the 80 largest unsecured claims.  Calpine makes it clear that the
information presented in the Top 80 List does not constitute an
admission by the Debtors nor is it binding on the Debtors.  The
Debtors reserve all rights to challenge the priority, nature,
amount and status of any claim or debt.

Creditor
--------
Wilmington Trust Company
1100 North Market Street
Mailcode 2301
Wilmington, DE 19890                 8-1/2% Senior
Tel: (302) 636-6016                  Senior Notes
Fax: (302) 636-4145                  due 2008       $1,439,157,825

Wilmington Trust Company             8-1/2%
                                     Senior Notes
                                     Due 2011         $702,942,818

Wilmington Trust Company             7.75%
                                     Convertible
                                     Notes Due
                                     2015             $652,658,681

Wilmington Trust Company             6.00%
                                     Convertible
                                     Senior Notes
                                     Due 2014         $650,133,853

Wilmington Trust Company             4.75%
                                     Convertible
                                     Notes Due
                                     2023             $636,701,808

Wilmington Trust Company             8-5/8%
                                     Senior Notes
                                     Due 2010         $423,449,697

Deutsche Bank
60 Wall Street, 27th Floor
New York, NY 10005                   8-7/8%
Tel: 44-207-5477392                  Senior Notes
Fax: 44-207-5476149                  Due 2011 (6BP)   $211,197,016

The Bank of New York
101 Barclay Street, 21W
21 W New York, NY 10286              8-3/4%
Tel: (212) 815-5845                  Senior Notes
Fax: {212) 815-3272                  Due 2007         $197,468,251

The Bank of New York                 7-3/4%
                                     Senior Notes
                                     Due 2009         $183,129,174

The Bank of New York                 7-7/8%
                                     Senior Notes
                                     Due 2008         $176,763,807

Wilmington Trust Company             8-3/4%
                                     Senior Notes
                                     Due 2007         $173,781.867

US Bank
633 West 5th Street, 24th Floor
Los Angeles, CA 90071                10-1/2%
Tel: (617) 603-6582                  Senior Notes
Fax: (617) 603-6669                  Due 2006         $140,626,051

Deutsche Bank                        8-3/8%
                                     Senior Notes
                                     Due 2008         $139,559,555

The Bank of New York                 7-5/8%
                                     Senior Notes
                                     Due 2006         $103,600,942

Calpine Commercial Trust
111 - 5th Avenue SW, Suite 2800
Calgary, Alberta T2P 3Y6 CANADA      Bank Loan -
Tel: (403) 750-3368                  Calpine Canada
Fax: (403) 264-4203                  Power             $30,384,425

AMERADA HESS CORPORATION
1 HESS PLAZA
WOODBRIDGE, NJ 07095-0961
Fax: 713/609-4251                    Energy Trading     $9,391,978

DYNEGY MARKETING AND TRADE
P.O. BOX 730508
DALLAS, TX 75373-0508
Tel: 713/507-6410                    Energy Trading     $7,557,989

Enbridge Pipelines
(Bamagas Infrastate) Inc.
1100 Louisiana, Suite 3300
Houston, TX 77002
Tel: 713-821-2010
Fax: 713-821-2140                    Trade Debt         $6,184,852

Dominion Energy Marketing, Inc.
Dominion Energy Clearinghouse
120 Tredegar Street
Richmond, VA 23219
Tel: 804-787-5939
Fax: 866-339-6874                    Trade Debt         $5,641,916

PACIFIC GAS AND ELECTRIC COMPANY
PO BOX 997300
SACRAMENTO, CA 95899-7300
Tel: 800.945.5251                    Trade Debt         $4,682,696

Elm Ridge Exploration Co.,
   a Ltd. Partnership
12225 Greenville Avenue, Suite 950
Dallas, TX 75243                     Trade Debt         $4,108,800

GENERAL ELECTRIC COMPANY
PO BOX 641469
PITTSBURGH, PA 15264-1469            Trade Debt         $4,083,131

Pogo Producing Company
5 Greenway Plaza, Suite 2700
Houston, TX 77046-0504               Trade Debt         $4,068,498

PRECICAST S.A.
3215 OLD FARM LANE
WALLED LAKE, MI 48390
Tel: 248-669-3120
Fax: 248-669-6930                    Trade Debt         $3,756,943

LYONDELL-CITGO REFINING LP
12000 LAWNDALE
HOUSTON, TX 77252-2451               Trade Debt         $3,022,432

ABB POWER T&D CO. INC.
PO BOX 100264
PASADENA, CA 91189-0264              Trade Debt         $2,948,669

South Carolina Pipeline Corporation
PO Box 102407
Columbia, SC 29224-2407
Tel: 803-217-2134
Fax: 803-217-2104                    Trade Debt         $2,806,812

GENERAL ELECTRIC INTERNATIONAL, INC.
c/o DEUTSCHE BANK AND TRUST
ACCT # 502 721 19
NEW YORK, NY 10001
ATTN: BILLY H. WHITAKER
Fax: 262-786-5589                    Trade Debt         $2,715,755

INSTITUTION OF PROPULSION TECHNOLOGY
1936 SOUTH ANDREWS AVENUE
FT. LAUDERDALE, FL 33316
Tel: 954-763-3303
Fax: 954-522-6507                    Trade Debt         $2,455,000

Cross Timbers Energy Services, Inc.
810 Houston Street
Fort Worth, TX 76102-6298
Tel: 817-885-2204
Fax: 817-882-7259                    Trade Debt         $2,229,000

Atlantic Oil Company
310 East Colorato Street, Suite 201
Glendale, CA 91205                   Trade Debt         $2,225,175

Contra Costa Water District
1331 Concord Avenue
P.O. Box H2O
Concord, CA 94524-2099
Tel: (925) 638-8300
Fax: (925) 688-8347                  Payable            $2,184,242

Coral Energy Holding, L.P.
909 Fannin, Suite 700
Houston, TX 77010
Tel: 713-230-3849
Fax: 713-767-5445                    Trade Debt         $2,094,400

Stream Energy, inc.
5001 CALIFORNIA AVENUE, SUITE 110
BAKERSFIELD, CA 93309                Trade Debt         $2,039,977

CHURBUCK, THOMAS
911 Tamarind Way
Boca Raton, Florida 33486            Trade Debt         $1,922,539

Tenaska Power Services Co.
1701 E. Lamar Blvd., Suite 100
Arlington, TX 76006
Tel: 817-462-1521
Fax: 817-462-1038                    Trade Debt         $1,771,170

THE DOW CHEMICAL COMPANY
PO Box 1398
Pittsburg, CA 94565                  Trade Debt         $1,663,863

Select Energy Inc.
P.O. Box 270
Hartford, CT 06037
Tel: 860-665-6892
Fax: 860-665-6892                    Trade Debt         $1,612,663

Portland Natural Gas
   Transmission System
One Harbour Place, Suite 375
Portsmouth, NH 03801
Tel: 603-559-5500
Fax: 603-427-2807                    Trade Debt         $1,480,823

LONG ISLAND POWER AUTHORITY
ATTN: CASH MGMT.-NPB, 22nd Floor
1 METROTECH CENTER
BROOKLYN, NY 11201
Tel: 800-490-0025                    Trade Debt         $1,347,808

NOVA Gas Transmission Ltd.
450 - 1st Street S.W., 10th Floor
Calgary, Alberta T2P 1C9
CANADA
Tel: 403-920-2739
Fax: 403-920-2368                    Trade Debt         $1,341,379

Wilmington Trust Company             4% Convertible
                                     Senior Notes
                                     Due 2006           $1,336,346

KRAFT, ROBERT
1470 S.W. Dyer Point Road
Palm City, Florida 34990             Trade Debt         $1,311,016

BRUCE AGARDY
15050 Golden Point Lane
Wellington, Florida 33432            Trade Debt         $1,311,016

FRESH MEADOW MECHANICAL CORP.
65-01 FRESH MEADOW LANE
FRESH MEADOWS, NY 11365              Trade Debt         $1,256,856

HICKHAM INDUSTRIES, INC.
11518 OLD LAPORTE RD
LA PORTE, TX 77571
Tel: 713-567-2700                    Trade Debt         $1,245,491

ESCO TURBINE TECHNOLOGIES
P. O. BOX 92601
CLEVELAND, OH 44101-2601
Tel: 800 927 3555
Fax: 216 430 6915                    Trade Debt         $1,100,488

NOOTER/ERIKSEN, INC
PO BOX 66888
SAINT LOUIS, MO 63166-6688           Trade Debt         $1,185,810

Safeway Inc.
P.O. Box 29097
Phoenix, AZ 85038
Tel: 623-869-4551
Fax: 925-467-3214                    Trade Debt         $1,165,433

Rosetta Resources Operating LP
717 Texas Avenue, Suite 2800
Houston, TX 77002
Tel: 713-830-2000
Fax: 713-830-&749                    Trade Debt         $1,086,787

Equity Oil Company
1700 Broadway, Suite 2300
Denver, CO 80290-2300                Trade Debt         $1,047,624

Slawson Exploration Company, Inc.
1675 Broadway, Suite 1600
Denver, CO 80202-1675                Trade Debt         $1,045,671

Brigham Oil & Gas, L.P.
Bldg. 2, Suite 500
6300 Bridgeport Parkway
Austin, TX 78730                     Trade Debt         $1,028,280

DEUTSCHE BANK TRUST COMPANY AMERICAS
GLOBAL LOAN OPERATIONS
STANDBY LETTER OF CREDIT UNIT
NEW YORK, NY 10005
ATTN: MARY JO JONES                  Trade Debt         $1,023,585

Alline Ford Brown Trust U/A
NationsBank of Texas
ATTN: Mr. Don Onstott
P.O. Box 830241
Dallas, TX 75283-0241                Trade Debt         $1,023,443

ARENA CAPITAL, LTD
16 BEACHSIDE COMMON
WESTPORT, CT 06880                   Trade Debt         $1,012,163

SCIENCE APPLICATIONS INT'L CORP.
PO BOX 223058
PITTSBURGH, PA 15251-2058
ATTN: DAVE LELAND/MATT BIROS         Trade Debt           $992,439

Southern Natural Gas Company
PO Box 102502
Atlanta, GA 30368-0000
Tel: 205-325-7344
Fax: 205-326-2038                    Trade Debt           $990,291

PETER SCALAMANDRE & SONS
157 ALBANY AVENUE
FREEPORT, NY 11520-4710              Trade Debt           $958,652

BONNEVILLE POWER ADMINISTRATION
FEDERAL RESERVE BANK ACCT: #89001401
NEW YORK, NY 10006
Tel: 503-230-3340                    Trade Debt           $945,340

TOSHIBA INTERNATIONAL CORP
650 CALIFORNIA STREET, 29TH FL
SAN FRANCISCO, CA 94108              Trade Debt           $923,587

SIEMENS POWER GENERATION, INC.
DEPT. CH10169
PALATINE, IL 60055-0169              Trade Debt           $892,110

KEYSPAN ENERGY DELIVERY
P.O. BOX 888
HICKSVILLE, NY 11815-0001            Trade Debt           $860,871

LEADING EDGE TURBINE TECHNOLOGIES
DEPT TX 10069
PO BOX 4703
HOUSTON, TX 77210-4703
Fax: 281-821-7755                    Trade Debt           $821,928

GCE INDUSTRIES INC.
P. 0. BOX 6661
ASHLAND, VA 23005
Tel: 804-550-5191                    Trade Debt           $816,543

NABORS DRILLING USA INC
PO BOX 973527
DALLAS, TX 75397-3527                Trade Debt           $783,190

JERSEY CENTRAL POWER & LIGHT
PO BOX 3687
AKRON, OH 44309-3687
Tel: 800-662-3155                    Trade Debt           $746,669

DELL MARKETING, L.P.
c/o DELL USA LP
PO BOX 910916
PASADENA, CA 91110-0916
ATTN: LAVINA TOURANI
Tel: 800-762-9473                    Trade Debt           $741,956

Ivanhoe Energy (USA), Inc.
5060 California Avenue, Suite 400
Bakersfield, CA 93389                Trade Debt           $726,443

SUNY AT STONY BROOK
ATTN: ANITA KEFELAS
460 ADMINISTRATION BUILDING
STONY BROOK, NY 11794-1151           Trade Debt           $724,092

Hi-Tek Manufacturing Inc.
6050 Hi-Tek Court
Mason, OH 45040
Tel: 513-459-1094 ext 109
Fax: 513-459-9882                    Trade Debt           $668,720

Tampa Electric Company
702 N. Franklin Street
Tampa, FL 33602
Tel: 813-228-1256
Fax: 813-228-4922                    Trade Debt           $664,212

CONTRA COSTA WATER DISTRICT
ACCOUNTS RECEIVABLE DEPT.
1331 CONCORD AVENUE
CONCORD, CA 94524                    Trade Debt           $663,080

SEMPRA
101 ASH STREET, HQ11B
SAN DIEGO, CA 92101-3017             Trade Debt           $657,558

CREDIT SUISSE FIRST BOSTON
BANK OF NEW YORK ACCT. #8900387742
NEW YORK, NY 10008                   Trade Debt           $644,928

WestCoast Energy, Inc.
2200 The Dome Tower
333 - 7th Ave, SW
Calgary, Alberta T2P 2Z1 CANADA
Tel: 403-699-1694
Fax: 403-699-168                     Trade Debt           $634,845

TENNESSEE VALLEY AUTHORITY
1101 MARKET STREET MR1D
CHATTANOOGA, TN 37402
Tel: 865-632-2481                    Trade Debt           $619,414

TRS SERVICES, INC.
2100 SKINNER ROAD
HOUSTON, TX 77093
Fax: 713-692-5299                    Trade Debt           $601,968

Western Area Power Authority
114 PARKSHORE DRIVE
FOLSOM, CA 95630                     Trade Debt           $586,680

City of Vernon
4305 Santa Fe Ave.
Vernon, CA 90058
Tel: 323-583-8811
Fax: 323-581-1354                    Trade Debt           $578,285


CALPINE CORP: Chapter 11 Bankruptcy Filing Sparks Fitch's D Rating
------------------------------------------------------------------
Fitch Ratings has downgraded Calpine Corp.'s issuer default rating
to 'D' from 'CC' following the company's filing of Chapter 11
bankruptcy on Dec. 20, 2005.  The Negative Rating Outlook is
removed. Ratings on CPN and unit Calpine Canada Energy Finance ULC
(senior unsecured debt guaranteed by CPN) remain unchanged:

     -- First-priority secured notes 'B/RR1';
     -- Second-priority secured notes 'B-/RR1';
     -- Senior unsecured and convertible notes 'CC/RR5'.

The debt instrument ratings and recovery ratings reflect Fitch's
analysis of the ultimate recovery prospects of individual creditor
classes following the bankruptcy process.  The recovery analysis
for CPN was published by Fitch on Dec. 1, 2005.  Based on this
analysis, Fitch estimates strong recovery prospects in the range
of 90% to 100% of par value for the First-priority and
Second-priority secured notes, and rather weak recovery prospects,
in the range of 11% to 30% of par, for the senior unsecured and
convertible note holders.

CPN's decline has been over a protracted period of time and Fitch
expects little disruption to the power markets from its demise.

At the same time, with approximately 28,000 megawatts of net
generating capacity in operation, CPN remains a major supplier of
power in certain regions such as Texas and California and a large
counterparty to many utilities and municipal, cooperative and
public power entities.  Many of CPN's power sales agreements are
at prices significantly below market and already California has
petitioned the FERC to compel CPN to continue to supply power in
accordance with the original terms.  Fitch will continue to
monitor the credit and market implications of CPN's bankruptcy.


CALPINE CORP: S&P's Ratings Tumble to D After Bankruptcy Filing
---------------------------------------------------------------
Standard & Poor's Rating Services lowered its ratings on electric
power giant Calpine Corp. and some of its subsidiaries to 'D'
after the company filed for Chapter 11 bankruptcy protection.

The San Jose, California-based company, which develops, acquires,
owns, and operates power generation facilities, has about
$18 billion of total debt outstanding.

At the same time, the recovery ratings for Calpine and its
subsidiaries remain at their current level, but are placed on
CreditWatch with negative implications.  Standard & Poor's will
review any financials and restructuring plans that may become
available to assess the effect on recovery prospects.  If
sufficient information is not available in the near term, Standard
& Poor's will withdraw the recovery ratings.

The company is seeking $2 billion in debtor-in-possession
financing.

"The negative CreditWatch listings reflect concerns about the size
and terms of the potential DIP financing, and about the potential
accommodations that junior lenders could receive in connection
with the DIP," said Standard & Poor's credit analyst Jeffrey
Wolinsky.

Under Standard & Poor's assumptions, the bankruptcy filing could
potentially eliminate up to $1.2 billion in annual cash interest
expense.  If Calpine does in fact need $2 billion of DIP financing
to remain viable, then the liquidity position may have
deteriorated materially since the 12-month period ended
Sept. 30, 2005.

In addition, a $2 billion DIP financing could significantly affect
the recovery on the second-lien debt.  The second-lien
Calpine debtholders have challenged the DIP on the grounds that
their collateral interests are not protected.  Excessive legal
costs associated with the bankruptcy could affect the recovery
ratings.  Historically, our recovery ratings assume that value is
distributed to claimants on the basis of absolute priority.
Offsetting this may be the potential for some creditors to extract
accommodations in connection with the DIP.  Junior creditors could
receive higher levels of recovery than anticipated, at the expense
of the senior creditors.

In addition, the ratings on all of the Calpine debt and preferred
stock was lowered to 'D' and the debt on most of Calpine's
subsidiaries were lowered to 'D', with some exceptions. The
ratings on Calpine Construction Finance Co. L.P. remains unchanged
at 'CCC-', because this entity was excluded from the bankruptcy
filing.  However, there is a possibility that this entity could be
filed in the future.

In addition, the ratings on Rocky Mountain Energy Center LLC and
Riverside Energy Center LLC were lowered to 'CCC' from 'B-'.
Although the projects are structured as bankruptcy-remote,
special-purpose entities that meet Standard & Poor's ring-fencing
criteria, the risk remains that these wholly owned Calpine
subsidiaries could be included in a future filing.

Also, the ratings on Power Contract Financing LLC remain at 'BBB'
and the Standard & Poor's underlying rating on Gilroy Energy
Center LLC remains at 'BBB-'.  However, the outlooks on both
ratings were changed to negative from stable because now that
Calpine has actually filed for bankruptcy, both companies are at
greater risk of consolidation into the bankruptcy.  PCF meets
Standard & Poor's criteria for special-purpose entities.  The LLC
agreement provides for two independent directors whose votes are
needed in matters of interest to bondholders.

Because Calpine Energy Services has completely extricated itself
from the structure, Standard & Poor's rates the structure almost
independently of Calpine's rating.  In addition, Gilroy Energy's
ratings are not affected because Calpine sold a significant
portion of its equity interest in the project.  Standard & Poor's
delinked the bond rating from the rating on Calpine.  Having an
equity partner greatly reduces Gilroy Energy's risk of a
substantive consolidation in a Calpine bankruptcy scenario because
the equity sale gives the second owner substantial voting and
ownership rights to block a consolidation.


CAPITAL AUTOMOTIVE: Moody's Lowers Preferred Stock Rating to B1
---------------------------------------------------------------
Moody's Investors Service affirmed the Ba1 corporate family rating
and changed to Ba1 from (P)Ba1 the senior secured debt rating of
Capital Automotive REIT.  As expected, the rating agency also
lowered the senior unsecured debt and preferred stock ratings to
Ba3, from Baa3, and to B1, from Ba1, respectively, concluding the
review of these securities.  The rating outlook is now stable for
all classes of debt.  These rating actions are a result of the
acquisition of Capital Automotive by investors advised by DRA
Advisors LLC.

The stable rating outlook reflects Moody's expectation that the
REIT will continue to grow steadily while maintaining stable
credit metrics under its new financial structure.  The stable
rating outlook also includes the expectation that the REIT will
maintain its leadership in the auto dealer net-lease sector
without any reduction in occupancies or rent coverages.

Moody's would consider an upgrade if Capital Automotive improved
fixed charge coverages to 2X, reduced effective leverage to the
mid-60% range and secured debt around 50% of gross assets.  The
REIT would also be required to reestablish an unsecured asset base
equal to at least 20% of gross asset value.  Any deterioration in
fixed charge coverage would create negative ratings pressure,
according to Moody's.  Additional negative pressure will likely
result should portfolio rent coverages drop below 2X, or should
the REIT suffer a decline in leadership causing a 15% decline in
NOI.

This rating has been affirmed with a stable outlook:

   Capital Automotive REIT:

     -- Ba1 corporate family rating

This rating has been changed with a stable outlook:

   Capital Automotive LP:

     -- Ba1 from (P)Ba1 $2.2 billion senior secured credit
        facility

These ratings have been lowered, with a stable outlook:

   Capital Automotive REIT:

     -- senior unsecured, to Ba3 from Baa3
     -- preferred stock to B1 from Ba3

In its last rating action, Moody's assigned Capital Automotive a
Ba1 corporate family rating on December 7, 2005.

Capital Automotive REIT is a real estate investment trust
headquartered in McLean, Virginia, USA.  The REIT's strategy is to
acquire real property and improvements used by operators of multi-
site, multi-franchised automotive dealerships and related
businesses.  As of September 30, 2005, the REIT had interests in
347 properties, consisting of 510 automotive franchises in 32
states.  The properties are leased under long-term, triple-net
leases with a weighted average initial lease term of approximately
15 years.

Approximately 76% of the REIT's real estate portfolio is located
in the top 50 metropolitan areas in the USA in terms of
population, and 73% of the REIT's real estate portfolio is
invested in properties leased to the "Top 100" dealer groups as
published by "Automotive News."  The REIT reported assets of $2.4
billion and equity of more than $1 billion at September 30, 2005.

DRA Advisors LLC is a New York City-based registered investment
advisor specializing in real estate investment management services
for:

   * institutional; and

   * private investors, including:

     -- pension funds,
     -- university endowments,
     -- foundations, and
     -- insurance companies.


CENTRAL WAYNE: Court Confirms Amended Plan of Liquidation
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland, Baltimore
Division, confirmed Central Wayne Energy Recovery LP's First
Amended Plan of Liquidation.

The Debtor's Plan will allow for an efficient liquidation of its
assets where creditors receive a greater recovery than would be
available in a chapter 7 liquidation.

Under the terms of the Plan:

          * administrative claims,

          * priority tax claims,

          * allowed priority claims,

          * allowed secured claims of the City of Dearborn
            Heights (for 2003 personal property taxes), and

          * the allowed secured claim of CE Wayne I, Inc. (for a
            special purpose working capital loan),

will be paid on or within 30 days after the Effective Date.

The Plan provides, among other things that:

          * secured claim of Wilmington Trust Company will be
            paid in cash after paying the above claims;

          * CE Wayne I, Inc. will receive no distribution on
            account of a general unsecured claim arising from a
            working capital loan;

          * other general unsecured creditors will receive a pro
            rata share from the Distribution Fund on the
            Distribution date on account of their claims; and

          * equity interests will be cancelled and nullified on
            the Effective Date.

Headquartered in Baltimore, Maryland, Central Wayne Energy
Recovery LP owns a waste-to-energy system facility that converts
the heat energy generated by incinerating waste to electricity.
The Company filed for chapter 11 protection on December 29, 2003
(Bankr. D. Md. Case No. 03-82780).  Maria Chavez Ruark, Esq.,
Piper Rudnick LLP represent the Debtor from its creditors.  When
the Company filed for protection from its creditors, it listed
more than $10 million in assets and more than $100 million in
debts.


COMMUNITY HEALTH: Board Approves Repurchase of 5 Million Shares
---------------------------------------------------------------
Community Health Systems, Inc. (NYSE: CYH) reported that its Board
of Directors has approved a new open market share repurchase
program for up to five million shares of the company's Common
Stock and that it is redeeming the balance of the outstanding
principal amount of its convertible notes.

The open market repurchase program will follow an existing share
repurchase program for up to five million shares of the company's
Common Stock, which program was initiated on Jan. 14, 2003 and
will terminate on Jan. 13, 2006.  As of Nov. 14, 2005, the company
has purchased 3,029,700 shares of its Common Stock at a total cost
of $94,555,735 pursuant to that program.

The new open market repurchase program will commence upon the
expiration of the existing open market repurchase program and will
terminate on the earlier to occur of the purchase of an aggregate
of five million shares of Common Stock under the new open market
stock repurchase program, not to exceed total purchases of
$200,000,000, or Jan. 13, 2009.  The company had approximately
92,993,965 million shares outstanding as of Dec. 15, 2005.

The company also announced its election to call for redemption all
of its remaining outstanding 4.25% Convertible Subordinated Notes
due 2008 on Jan. 17, 2006.  As of today there are $136,624,000 in
aggregate principal amount of the Notes outstanding.  The
redemption price is 101.821% of the principal amount of the Notes,
or $1,018.21 per $1,000 principal amount of the Notes, plus
accrued and unpaid interest to the redemption date.

Prior to the close of business on Jan. 13, 2006, holders may elect
to convert their Convertible Notes into shares of the company's
common stock, par value $.01, at a conversion price of $33.50 per
share, or 29.8507 shares for each $1,000 principal amount of the
Notes.  On Dec. 16, 2005, the last reported sale price of the
Company's common stock on the New York Stock Exchange was $39.05
per share.

The Convertible Notes became redeemable in full on Oct. 15, 2005.
However, the restricted payment covenant in the Indenture for the
company's 6.50% Senior Notes due 2012 limits the amount of cash
available to redeem the Convertible Notes in full.  This call for
redemption follows the company's Nov. 14, 2005 call for redemption
of $150 million in principal amount of the Convertible Notes.  At
the conclusion of the first call for redemption, $288,000 in
principal amount of the Convertible Notes were redeemed.  Prior to
the redemption date, $149,712,000 of the Convertible Notes called
for redemption, plus an additional $876,000 of the Convertible
Notes, were converted by the holders into 4,495,083 shares of the
company's common stock, $.01 par value per share.

A notice of redemption for the redemption has been sent by
Wachovia Bank, National Association (successor trustee to First
Union National Bank), the trustee, paying agent, and conversion
agent for the Convertible Notes, to all registered holders of the
Convertible Notes.  Copies of this notice and additional
information related to redemption or conversion may be obtained
from:

     Wachovia Bank
     National Association
     Attention: Corporate Trust Group
     230 4th Avenue North, 7th Floor
     Nashville, Tennessee 37219

or by calling Caroline Oakes at 615/525-2309.

Located in the Nashville, Tennessee, suburb of Brentwood,
Community Health Systems -- http://www.chs.net/-- is a leading
operator of general acute care hospitals in non-urban communities
throughout the country.  Through its subsidiaries, the company
currently owns, leases or operates 71 hospitals in 21 states.  Its
hospitals offer a broad range of inpatient medical and surgical
services, outpatient treatment and skilled nursing care.  Shares
in Community Health Systems, Inc. are traded on the New York Stock
Exchange under the symbol "CYH."

                          *     *     *

As reported in the Troubled Company Reporter on Sep. 26, 2005,
Standard & Poor's Ratings Services revised its outlook on
Brentwood, Tennessee-based hospital operator Community Health
Systems Inc. to positive from stable.  Ratings on the company,
including the 'BB-' corporate credit rating, were affirmed.


CYBERCARE INC: Court Okays Espy as Special Collection Counsel
-------------------------------------------------------------
The Hon. Michael G. Williamson of the U.S. Bankruptcy Court for
the Middle District of Florida, Tampa Division gave CyberCare,
Inc., f/k/a Medical Industries of America, Inc., and Cybercare
Technologies, Inc., permission to employ Alan C. Espy, P.A., as
their special collection counsel.

Mr. Espy will provide advice and services in connection with the
continued prosecution of claims and causes of action, which are
primarily asserted against the Debtors' former officers and
directors.

The Debtors selected Espy because of its experience in commercial
litigation and its services are necessary to provide the Debtors
with advice regarding these matters.  In addition, Espy
represented the Debtors prior to the bankruptcy filing and has
significant familiarity regarding these issues.

The Debtors agree to reimburse Espy's costs and pay Espy a
contingent collection fee equal to:

  (A) On the first $1,000,000 recovered on any one account:

      -- 33-1/3% after suit is filed and up until the
         commencement of a trial; or

      -- 40% after commencement of a trial;

  (B) On the second $1,000,000 recovered on any one account:

      -- 30% if the Defendant denies liability; or

      -- 20% if the Defendant admits liability;

  (C) On amounts recovered in excess of $2,000,000 on any one
      account:

      -- 20% if the Defendant denies liability; or

      -- 15% if the Defendant admits liability.

For any structured settlement, the contingent fee is based on the
"present net worth" of the settlement package.

An additional 5% fee is payable to Espy if an appeal or any post
judgment proceedings are required.

Mr. Espy assures the court that the Firm does not represent or
hold any interest adverse to the Debtors, their creditors or their
estates.

Mr. Espy's Firm can be contacted at:

        Alan C. Espy, P.A.
        3300 PGA Boulevard,  Suite 630
        Palm Beach Gardens, Florida 33410

Headquartered in Tampa, Florida, CyberCare, Inc., f/k/a Medical
Industries of America, Inc., is a holding company that owns
service businesses, including a physical therapy and
rehabilitation business, a pharmacy business, and a healthcare
technology solutions business.  The Company and its debtor-
affiliate, CyberCare Technologies, Inc., filed for chapter 11
protection on Oct. 14, 2005 (Bankr. M.D. Fla. Case No. 05-27268).
Scott A. Stichter, Esq., at Stichter, Riedel, Blain & Prosser
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$5,058,955 in assets and $26,987,138 in debts.


DELPHI CORP: Wants to Employ Price Heneveld as I.P. Co-Counsel
--------------------------------------------------------------
Price, Heneveld, Cooper, DeWitt & Litton LLP is a boutique law
firm specializing in intellectual property matters with around 24
attorneys who handle sophisticated intellectual property matters.
Several members of the firm have extensive experience in
intellectual property law, including patent law.

Delphi Corporation and its debtor-affiliates have engaged Price
Heneveld in the ordinary course of their business operations.  As
a result, Price Heneveld is familiar with the unique intellectual
property issues that face the Debtors.

The Debtors, however, are concerned that Price Heneveld will
exceed the fee cap established in the OCP Order.

Thus, the Debtors ask the U.S. Bankruptcy Court for the Southern
District of New York for authority to formally employ Price
Heneveld as their intellectual property legal services provider,
nunc pro tunc to October 8, 2005.

Price Henevald is expected to provide:

    (a) legal advice concerning intellectual property, including
        patent, trademark, copyright and trade secret matters;

    (b) legal advice related to intellectual property issues
        including electronics devices, including circuits,
        controllers, and packages, semiconductor devices and
        microelectromechanical systems devices and fabrication
        techniques, sensors, communications systems including
        radio, entertainment and antenna devices, software related
        inventions, automotive safety devices, and other
        automotive related inventions; and

    (c) representation of the Debtors in connection with
        intellectual property matters, including preparation and
        prosecution of applications in the United States and in
        foreign countries.

Kevin T. Grzelak, Esq., an attorney at Price Heneveld, assures
Judge Drain that the firm does not hold or represent any interest
adverse to the Debtors or any party-in-interest in their
bankruptcy proceedings.

The Debtors propose to pay Price Heneveld in accordance with its
standard hourly rates and to reimburse the firm for its necessary
expenses.

The Price Heneveld attorneys who are expected to be principally
responsible in the Debtors' cases and their hourly rates are:

          Kevin Grzelak, Esq.              $275
          Jeff Johnson, Esq.               $130
          Jeff Kapteyn, Esq.               $220
          Brian Cheslek, Esq.              $145

Headquartered in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is the single largest global supplier of
vehicle electronics, transportation components, integrated systems
and modules, and other electronic technology.  The Company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  The Company filed for chapter 11
protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-44481).  John Wm. Butler Jr., Esq., John K. Lyons, Esq., and
Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP,
represents the Debtors in their restructuring efforts.  As of
Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530
in total assets and $22,166,280,476 in total debts. (Delphi
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


DELPHI CORP: Lead Plaintiffs Object to Hiring of Deloitte & Touche
------------------------------------------------------------------
As previously reported in the Troubled Company Reporter on Dec. 6,
2005, Delphi Corporation and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
to employ Deloitte & Touche LLP, as their independent auditors and
accountants, nunc pro tunc to October 8, 2005.

                      *     *     *

The Teachers' Retirement System of Oklahoma, the Public Employees'
Retirement System of Mississippi, Raiffeisen Kapitalanlage-
Gesellschaft m.b.H. and Stichting Pensioenfonds ABP, the Court-
appointed Lead Plaintiffs in the consolidated securities class
action entitled In re Delphi Corp. Securities Litigation, Master
File No. 1:05-CV-2637 (NRB)(SDNY), ask the Court to deny the
Debtors' request on three grounds:

    (1) Deloitte & Touche LLP's competence has been seriously
        called into question vis-avis its work for Delphi because
        it has failed to conduct audits according to Generally
        Accepted Auditing Standards and has contributed to, or
        participated in, the Debtors' recently disclosed
        securities fraud.

    (2) Employing Deloitte would create a number of sustainable
        conflicts of interest:

          (i) Because of its status as a defendant in a multi-
              billion dollar securities lawsuit, Deloitte has no
              incentive to detect and correct the Debtors'
              prepetition accounting improprieties and has strong
              incentive to conceal shortcomings in its own
              prepetition audits;

         (ii) Deloitte has incentive to limit inquiry into sham
              transactions between Delphi and co-defendants
              Setech, Inc., and J.P. Morgan/Bank One, which are
              the Deloitte's clients;

        (iii) Deloitte has incentive to conceal fraudulent
              transactions between Delphi and other parties it
              represents;

         (iv) The Debtors will also retain several "entities
              affiliated" with Deloitte, an arrangement under
              which it will receive generous compensation for both
              auditing and non-auditing work; and

          (v) The prospect for the assertion of cross-claims
              between Deloitte and Delphi's officers and directors
              as well as indemnification claims against Delphi
              itself is manifest; and

    (3) The Debtors' Application fails to provide basic and
        essential details about the relationship, if any, between
        Deloitte's proposed engagement team and the personnel and
        teams that participated in Deloitte's failed prepetition
        Delphi engagements.  The Application also neglects to
        indicate whether Deloitte modified its audit plan in
        response to the Debtors' Chapter 11 petition, or even in
        response to the admitted massive failures in Delphi's
        accounting and internal controls.

If the Court does not deny the Debtors' Application, the Lead
Plaintiffs ask the Court to withhold any decision until the
Debtors:

    -- produce evidence that reveals the nature and extent of
       Deloitte's prepetition audit work for Delphi, including its
       role in the fraudulent accounting transactions and
       practices which Delphi has admitted engaging;

    -- disclose prepetition communications among them and Deloitte
       concerning the proposed audit engagement, including
       contingencies for Delphi's Chapter 11 petition;

    -- disclose the identities of Deloitte's personnel who worked
       on its prepetition Delphi engagement, and of those proposed
       to be retained for the Debtors' engagement, as well as the
       terms of those engagements; and

    -- disclose communications and negotiations among them,
       Deloitte and its affiliates:

          * Deloitte Financial Advisory Services LLP,
          * Deloitte Consulting LLP, and
          * Deloitte Tax LLP,

       concerning non-audit work to be performed, including the
       terms of the proposed work and the personnel to be engaged.

In the alternative, the Lead Plaintiffs ask the Court to require
the Debtors to produce evidence to ascertain the appropriateness
of their request.

Headquartered in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is the single largest global supplier of
vehicle electronics, transportation components, integrated systems
and modules, and other electronic technology.  The Company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  The Company filed for chapter 11
protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-44481).  John Wm. Butler Jr., Esq., John K. Lyons, Esq., and
Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP,
represents the Debtors in their restructuring efforts.  As of
Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530
in total assets and $22,166,280,476 in total debts. (Delphi
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


DELPHI CORP: Wants to Employ Cantor Colburn as Patent Counsel
-------------------------------------------------------------
Delphi Corporation and its debtor-affiliates seek The Honorable
Robert D. Drain of the U.S. Bankruptcy Court for the Southern
District of New York's permission to employ Cantor Colburn LLP as
their patent counsel.

The Debtors inform the Court that Cantor Colburn specializes in
patent and intellectual property law and is familiar with the
interplay between these areas and restructuring and bankruptcy
law.

The Debtors relate that they had employed Cantor Colburn as an
ordinary course professional in accordance with the Court's
previous order.  However, they are concerned that Cantor Colburn
will exceed the fee cap established in the OCP Order.

David M. Sherbin, vice president, general counsel and chief
compliance officer of Delphi Corporation, tells Judge Drain
Cantor Colburn is attuned to the Debtors' intellectual property
portfolio, the unique patent and intellectual property issues
that arise in the Debtors' industry, and the manner in which the
Debtors desire their patent applications to be prepared and
prosecuted.

As patent counsel, Cantor Colburn will:

    (a) prepare patent applications in various fields relating to
        the Debtors' business operations for filing in the United
        States Patent and Trademark Office, including applications
        directed to devices, components, processes and systems
        relating to inflatable restraints, inflatable cushions,
        occupant restraints, safety restraints, exhaust treatment,
        sensors, catalysts, solid oxide fuel cells, fuel control
        systems and steering systems;

    (b) respond to office actions and otherwise prosecute patent
        applications before the United States Patent and Trademark
        Office;

    (c) render patentability, infringement and clearance
        opinions;

    (d) draft and negotiate intellectual property acquisitions,
        transfers or licenses relating to the Debtors' business
        operations;

    (e) represent the Debtors in actual and contemplated
        intellectual property and related litigation; and

    (f) perform other patent and intellectual property-related
        legal services as the Debtors may from time to time
        request.

Cantor Colburn will be paid in accordance with its usual and
customary hourly rates, which range from $150 to $385.  Unless
otherwise agreed to by the parties, the professional service fees
charged by the firm for preparing a patent application for filing
before the Patent and Trademark Office will be capped at $5,000.
The firm's professional service fees in connection with preparing
a response to an office action from the Patent and Trademark
Office will be capped at $1,650.

When the parties agree that work to be performed is beyond the
scope of a typical patent application or response to an office
action, Cantor Colburn's professional service fee will not be
subject to the caps.  The Debtors will reimburse Cantor Colburn
for necessary expenses incurred.

According to Philmore H. Colburn II, Esq., a representative of
Cantor Colburn, the firm does not hold or represent any interest
adverse to the Debtors, their creditors, any other party-in-
interest in their Chapter 11 cases, or the U.S. Trustee with
respect to the matters on which the firm is to be employed.

The firm does not believe that its current representation of
parties-in-interest raises any actual or potential conflict of
interest relating to its representation of the Debtors as patent
counsel.

Headquartered in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is the single largest global supplier of
vehicle electronics, transportation components, integrated systems
and modules, and other electronic technology.  The Company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  The Company filed for chapter 11
protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-44481).  John Wm. Butler Jr., Esq., John K. Lyons, Esq., and
Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP,
represents the Debtors in their restructuring efforts.  As of
Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530
in total assets and $22,166,280,476 in total debts. (Delphi
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


DELTA AIR: Chromalloy Gas Wants Stay Lifted to Effect Recoupment
----------------------------------------------------------------
Chromalloy Gas Turbine Corporation and Delta Air Lines, Inc., are
parties to a Letter Agreement, dated October 15, 2004, wherein,
among other things, Chromalloy agreed to reduce pricing for parts
and repairs by 8%.

On December 17, 2004, the Agreement was amended to specifically
provide that the 8% price reduction would be given by Chromalloy
on certain specified parts and repairs via the issuance of a
credit memorandum, applicable to the purchase of goods and
services from Chromalloy.  The credit memorandum was to be issued
within 15 business days after the end of the quarter, and based
upon paid invoices during the quarter.  The Amendment further
specified that in the event Delta filed for bankruptcy protection
after the rebate period began, unpaid rebates would be offset
against unpaid invoices.

Christopher J. Battaglia, Esq., at Halperin Battaglia Raicht,
LLP, in New York, relates that, as of the Petition Date, Delta
owed Chromalloy $908,607 in unpaid invoices for parts and
services for the third quarter, which invoices are subject to the
Agreement, as amended by the Amendment.  On the other hand,
Chromalloy owed Delta $368,650 in rebates for invoices paid for
the third quarter.

Chromalloy has not issued a credit memorandum to Delta for the
rebate.  Instead, Chromalloy has temporarily placed the funds in
an administrative hold.

By this motion, Chromalloy asks the U.S. Bankruptcy Court for the
Southern District of New York to lift the automatic stay to allow
it to exercise its prepetition rights of recoupment, or in the
alternative, exercise its rights to set off.

"Recoupments, unlike setoffs, do not involve the concept of
mutuality of obligations and arise out of the same transaction
rather than out of different transactions," Mr. Battaglia notes,
citing In Re Yonkers Hamilton Sanitarium, Inc., 22 B.R. 427, 432
(Bankr. S.D.N.Y. 1982), aff'd, 34 B.R. 385 (S.D.N.Y. 1983).

He says that the rebates owed to Delta arise out of the purchases
of parts and services.  He adds that, since the amounts owed to
Chromalloy prepetition arise directly from the same contract
allowing Delta an 8% rebate, they are subject to recoupment.  The
failure of Delta to pay all amounts due for parts and repairs to
Chromalloy prepetition for the third quarter gives Chromalloy the
right to recoup against any payment owed to Delta for the rebate
on parts and repairs during the same period.

Mr. Battaglia maintains that cause exists to lift the stay to
allow Chromalloy to exercise its right of set-off because it is
not adequately protected.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.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 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 14;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DELTA AIR: Court Modifies Stay of Mr. Pacitti's Injury Claim
------------------------------------------------------------
Len C. Pacitti asks the U.S. Bankruptcy Court for the Southern
District of New York to lift the bankruptcy stay so he can proceed
with his personal injury action against Delta Air Lines, Inc., and
Argenbright Security, Inc., currently pending in the United States
District Court for the Eastern District of New York.

The parties were only weeks away from completing discovery at the
time the stay went into effect.

Mr. Pacitti injured his knee after he was thrown from a
wheelchair while being pushed between gates at John F. Kennedy
Airport in New York by an employee of either Delta or
Argenbright.  Argenbright had a contract with Delta to provide
related services to Delta at the airport.

Mr. Pacitti has filed Claim No. 16 against Delta in connection
with the injuries.

Rory I. Lancman, Esq., at Morelli Ratner PC, in New York, asserts
that the stay should be lifted because the objection to a
personal injury claim is a non-core matter under Section
157(b)(2)(B) of the Judicial Procedures Code, and the Bankruptcy
Court lacks jurisdiction to liquidate a personal injury claim.

He adds that Delta has acknowledged that it has insurance from
United States Aviation Underwriters, Inc. and other co-insurers
sufficient to cover Mr. Pacitti's claim.

At most, the litigation requires the involvement of low-level
Delta employees employed at Kennedy Airport and will not
interfere with Delta's ability to proceed with its
reorganization, Mr. Lancman points out.

                 Mr. Pacitti Waives Claim

After extensive negotiations, Mr. Pacitti agrees to waive Claim
No. 16 and seek recovery solely from the insurance coverage, if
any, available under one or more insurance policies issued to
Delta Air Lines to satisfy the Claim.

At the Parties' behest, the Court modifies the automatic stay
solely to the limited extent necessary to enable:

   (a) the Claim to proceed to final judgment or settlement; and

   (b) Mr. Pacitti to attempt to recover any liquidated final
       judgment or settlement on the Claim solely from Available
       Coverage.

Any final judgment or settlement will be reduced by:

    (i) the amount of any applicable deductible or self-insured
        retention under the applicable insurance policy; and

   (ii) any share of liability under the applicable insurance
        policy of any insolvent or non-performing insurer or co-
        insurer.

The automatic stay will not be modified for purposes of
permitting Mr. Pacitti to attempt to recover from any party for
intentional conduct or punitive damages.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.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 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 14;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DELTA AIR: Court OKs Continuation of Terminated Employee's Appeal
-----------------------------------------------------------------
Pursuant to Section 362(d)(1) of the Bankruptcy Code, Richard W.
Drake asks the U.S. Bankruptcy Court for the Southern District of
New York to modify the automatic stay to allow him to continue his
appeal pending in the United States Court of Appeals, Second
Circuit, in the matter entitled Richard W. Drake v. Delta
Airlines, Inc., and if successful, continue the litigation in the
United States District Court for the Eastern District of New York.

Samuel O. Maduegbuna, Esq., at Maduegbuna Cooper LLP, in New
York, relates that Mr. Drake was a flight attendant terminated by
Delta in 1993.  Mr. Drake has a track record in establishing a
union, successfully running a union and orchestrating a
successful strike at his previous employment with Pan Am.

"Delta perceived him as a significant threat to Delta's
opposition to any attempt to unionize Delta Flight Attendants,"
Mr. Maduegbuna says.

Mr. Maduegbuna explains that, after Mr. Drake's track record
became apparent to Vicki Escarra, then director of in-flight
services, and who until her retirement in 2004 was Delta's No. 2
executive and executive vice-president and chief marketing
officer, Delta decided to get rid of Mr. Drake, by manipulating
Mr. Drake's selection and testing in violation of a federally
mandated drug testing program.

In October 2004, at the conclusion of a five-day jury trial, a
federal jury in Brooklyn found for Drake against Delta and
awarded him $800,000 in compensatory damages and $1,700,000 in
punitive damages, for violations of his rights under the Fourth
Amendment to the United States Constitution.  Delta made a post-
trial motion which, on July 27, 2005, was granted by Judge Block
who set aside the jury verdict of $2,500,000 in compensatory and
punitive damages.

On August 22, 2005, Mr. Drake timely commenced the Appeal.
However, the proceeding has been stayed because of the Debtors'
Chapter 11 filing.

Mr. Maduegbuna tells the Hon. Prudence Carter Beatty that Mr.
Drake will incur greater hardship if the stay is not modified.  On
the other hand, the continuation of the appeal and the litigation
in the District Court will not cause great prejudice to the
Debtors or result in the dissipation of the Debtors' assets during
the pendency of the bankruptcy proceeding.

Mr. Maduegbuna points out that the October 2004 jury verdict was
the culmination of Mr. Drake's more than 10-year quest to find a
remedy against Delta and other persons responsible for the
destruction of his 35-year exemplary career as a flight attendant
and injuries they caused to his name and reputation.

Mr. Maduegbuna informs the Court that during the discovery
process in the District Court, Delta failed to disclose the
existence of employment practices and punitive damages liability
insurance policies, claiming that it does not maintain insurance
coverage for the type of employment-related claim brought by Mr.
Drake.

However, Mr. Maduegbuna says, the Debtors disclosed the existence
of those policies in their motion filed with the Bankruptcy Court
to continue their existing insurance programs.

                 Debtors & Committee Object

Delta Air Lines and its debtor-affiliates ask the Court to deny
Richard W. Drake's request to lift the automatic stay so he can
pursue an appeal before the United States Court of Appeals for the
Second Circuit.

Jared R. Winnick, Esq., at Davis Polk & Wardwell, in New York,
explains that, contrary to Mr. Drake's claims, Delta does not
have insurance to cover the Action.

If the stay is lifted so that the Action can proceed, Delta will
have to spend administrative dollars to defend the prepetition
claim.  This is precisely the type of action that the automatic
stay is designed to enjoin, Mr. Winnick notes.

Mr. Drake has not, and cannot, meet his burden under Section 362
of the Bankruptcy Code to show cause to modify the automatic
stay, Mr. Winnick adds.

Mr. Winnick asserts that the Debtors will suffer substantial
injury if the stay is lifted.  The Debtors are presently at the
beginning stages of their Chapter 11 cases, which is the most
crucial time of their reorganization.  To be successful in
reorganizing their business, the Debtors must concentrate all of
their efforts on the immense task at hand.  The Action is the type
of distraction that the Debtors cannot afford at this critical
juncture.  Granting the Motion would effectively elevate Mr.
Drake's narrow interests over the interests of every other
constituency in this case, Mr. Winnick warns.

In contrast, Mr. Drake will suffer little, if any, harm if the
Motion is denied.  The delay imposed upon him as a result of the
automatic stay is likely to be minimal.  The parties have not
even begun to brief the Appeal.  Indeed, no briefing schedule or
oral argument dates have been set, and Mr. Drake has not even
suggested that there is any timetable in place for getting any
resolution on the Appeal.  Furthermore, the automatic stay almost
always delays litigants.  That, after all, is its purpose, and
the reason they call it a stay, Mr. Winnick insists, citing In re
Comdisco, Inc., 271 B.R. 273, 277 (N.D. Ill. 2002).

The Official Committee of Unsecured Creditors supports the
Debtors' objection to Mr. Drake's request.

                   Court's First Decision

The Court finds that the legal and factual bases in Mr. Drake's
Motion fail to establish just cause to lift the stay.  Judge
Beatty denies the Motion.

                   Court's Second Order

The Court withdraws its prior order, dated November 10, 2005, and
directs that the automatic stay will be lifted for the limited
purpose of allowing the Appeal to proceed in the United States
Court of Appeals for the Second Circuit and the entry of a
decision and mandate.  The automatic stay is otherwise in full
effect and is not lifted for any other purpose.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.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 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 14;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DOWNTOWN RESORTS: S&P Rates Proposed $140 Mil. Senior Notes at B-
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' rating to the
proposed $140 million senior secured notes due 2013 to be
co-issued by Downtown Resorts LLC and Downtown Capital
Corporation.

At the same time, Standard & Poor's assigned a 'B-' corporate
credit rating to Downtown Resorts.  The outlook is stable.  Pro
forma for the offering, the company will have $140 million of debt
outstanding.

Net proceeds from the proposed notes, along with about $21 million
of equity proceeds, will be used primarily:

     * to develop, construct, and re-brand the existing Lady Luck
       Casino Hotel in downtown Las Vegas;

     * to repay existing indebtedness;

     * to acquire the Third Street Promenade from an affiliate;
       and

     * to fund an approximately $20 million interest reserve
       account.

Downtown Resorts purchased the Lady Luck Casino Hotel in April
2005 for $24 million and concurrent with this proposed offering,
the company will acquire the Third Street Promenade -- a retail,
dining, and entertainment facility.  Resort Gaming LLC, an
affiliated company that currently manages a chain of taverns
throughout Las Vegas, will manage and operate the property
and the Third Street Promenade for a fee equal to cost
reimbursement.

The ratings on Downtown Resorts reflect the challenges associated
with the planned re-branding and repositioning of the existing
Lady Luck Casino Hotel into a newer property, given its location
in the mature downtown Las Vegas market.  Also, the company's high
pro forma debt leverage and small cash flow base increase the
risks that a slower-than-expected ramp-up period could affect the
company's liquidity position.


ENERGAS RESOURCES: Reaches Settlement with Double G Energy
----------------------------------------------------------
Energas Resources, Inc. (OTCBB:EGSR) has recently repurchased the
interest in the Pulaski County, Kentucky, gas field previously
sold to Double G Energy, Inc.  Energas has tried to repurchase
this interest before, but was unable to do so.  This repurchase
solidifies Energas' position and interest in this gas field.  This
repurchase also puts an end to the claims, disputes and pending
litigation existing between Energas and Double G.

Double G Energy Inc. sued Energas Resources Inc. and its
subsidiaries for breach of contract and other claims related to a
drilling project in Kentucky.

        Fiscal Third Quarter Results Ended Oct. 31, 2005

Energas' total revenue increased 175% to a record $387,381 from
$137,070, year over year.  Cash loss (Net Loss plus Depreciation,
Depletion and Amortization and Stock Based Compensation) decreased
88% to $32,666 from $275,566, year over year.  Net loss decreased
27% to $249,582 from $345,197, year over year, despite the current
quarter including $135,750 of employee stock awards and
approximately $65,000 related to the Double G litigation.

"We're extremely excited to report these results for our fiscal
third quarter," Scott Shaw, Vice President, commented.  "In this
period, we incurred approximately $65,000 in expenses related to
litigation with Double G Energy, Inc.  Without those costs, our
company would have generated positive cash flow for the first time
in history.  Our recently announced settlement with Double G
restores our 100% working interest in our largest currently
producing property, eliminates the ongoing legal and accounting
costs associated with such litigation and allows us to focus on
our marquis project, the Parkway, at this very important phase in
its development.  In the third quarter we also gave all of our
employees stock awards, to thank them for their loyalty and give
them a stake in our success.  Without the expenses related to
litigation with Double G and the stock awards, our net loss would
have been approximately $49,000."

Double G Energy Inc. is an oil and gas exploration company based
in Carrollton, Texas.

Operating through its A.T. Gas Gathering Systems and TGC
subsidiaries, Energas Resources Inc. --
http://www.energasresources.com/-- is primarily focused on
exploring and producing in the Arkoma Basin in Oklahoma, the
shallow Devonian Shale natural gas strata in the Appalachian Basin
of Kentucky, and the Powder River Basin in Wyoming.  Energas
Resources has proved reserves of nearly 30,400 barrels of oil and
2.2 billion cu. ft. of natural gas.  Chairman George Shaw owns
about 14% of the company.

                          *     *     *

                       Going Concern Doubt

Russell & Atkins, PLC, expressed substantial doubt about Energas
Resources, Inc.'s ability to continue as a going concern after it
audited the company's financial statements for the year ended
Jan. 31, 2005.  The auditing firm pointed to the company's
insufficient cash flows and operating losses.  The company's
management repeats those doubts in its latest quarterly financial
statement.  The company says it is currently seeking additional
funds and additional mineral interests through private placements
of equity and debt instruments.


EPICUS COMMS: Wants to Acquire Freedom Communications
-----------------------------------------------------
Epicus Communications Group, Inc. (OTCBB:EPCG) has entered into a
letter of intent to acquire Freedom Communications USA, a reseller
and facilities based CLEC, located in Nashville, Tennessee.  The
acquisition is expected to close in late January 2006.

Under the terms of the transaction, the parties will enter into a
definitive merger agreement whereby ECG will exchange shares of
its common stock for all outstanding Freedom common shares.  The
acquisition is subject to negotiation and execution of binding
definitive documents, satisfaction of certain conditions
precedent, and other ordinary and customary closing conditions.

"We are pleased by the announcement," Mark Schaftlein, CEO of ECG,
said.  "Our acquisition of Freedom signals our first step in
becoming a facilities based carrier and joins Freedom's 3,500
subscribers with our subscriber base of approximately 21,000
customers.  We anticipate combined revenues for the companies will
be in the range of $20 - $22 million in 2006, an increase over
2005 despite our recent reorganization."

Epicus Communications Group, Inc. operates as a Competitive Local
Exchange Carrier providing telecommunications services to both
business and residential customers in 8 southeastern states.  On
Dec. 7, 2005, the company announced it emerged from Chapter 11
bankruptcy proceedings as a newly reorganized company.

Headquartered in West Palm Beach, Florida, Epicus Group is a
holding company with a primary goal of investing in its current
telecommunications assets.  Epicus, Inc., it's a wholly-owned
subsidiary is an integrated communications provider with voice and
data service in the continuous 48 states, international long
distance in 240 countries with local exchange services in 7
southeastern states.  The Debtors filed for chapter 11 protection
on Oct. 25, 2004 (Bankr. S.D. Fla Case Nos. 04-34915 and
04-34916).  Alvin S Goldstein, Esq., represents the Debtors in
their restructuring efforts.

The Court confirmed Epicus' Plan of Reorganization on
Sept. 30, 2005.


FIRST INT'L: S&P Junks Ratings on Seven Class Certificates
----------------------------------------------------------
Fitch Ratings has downgraded these ratings for the First
International Bank.

   FIB business loan notes, series 2000-A

     -- Class A to 'B-' from 'B';
     -- Class M-1 to 'C' from 'CCC';
     -- Class M-2 to 'C' from 'CC';
     -- Class B to 'C' from 'CC'.

   FIB SBA loan-backed adjustable-rate certificates, series 1999-1

     -- Class A to 'B' from 'BB-';
     -- Class M to 'C' from 'CCC'.
     -- Class B to 'C' from 'CC'.

   FIB SBA loan-backed adjustable-rate certificates, series 2000-1

     -- Class A to 'CCC' from 'B';
     -- Class M to 'C' from 'CC'.

Fitch also affirms ratings for these classes of securities:

   FNBNE business loan notes, series 1998-A

     -- Class A 'AA';
     -- Class M-1 'BBB';
     -- Class M-2 'BB'.

   FIB business loan notes, series 1999-A

     -- Class A 'A+';
     -- Class M-1 'BBB';
     -- Class M-2 'BB'.

   FIB SBA loan-backed adjustable-rate certificates, series 2000-2

     -- Class A 'BB+';
     -- Class M 'B-'.

The downgraded classes reflect poor collateral performance and
declining credit enhancement.  Although delinquency and default
levels have declined, recovery proceeds have not increased enough
to off-set prior portfolio deterioration.  Employing Fitch's
recovery expectations on currently defaulted loans, collateral
performance is expected to continue to adversely affect the deals.
Due to this, Fitch anticipates further significant reductions in
credit enhancement.

The affirmed classes are performing within expectations and have
not experienced any significant changes since Fitch's last rating
action on Jan. 19, 2005.  These transactions have relatively
stabilized in performance, with delinquency levels declining and
the default pace lessening.  As a result the under-water positions
have improved, providing higher credit enhancement levels.

In its analysis, Fitch reviewed each transaction on an individual
loan basis.  All loans over 60 days delinquent were deemed
defaulted loans.  Loans were applied loss and recovery
expectations based on collateral characteristics and historical
recovery performance.  All loans over 180 days received a further
stress by discounting the remaining loan balance.  After
determining expected losses on each loan, these expectations were
applied to outstanding balances.  Fitch was then able to assess
the impact on enhancement levels.


FLOW INTERNATIONAL: Earns $2 Mil. of Net Income in Second Quarter
-----------------------------------------------------------------
Flow International Corporation (Nasdaq: FLOW) reported results for
its fiscal 2006, second quarter ended Oct. 31, 2005.  Flow
reported consolidated quarterly sales from continuing operations
of $50.7 million and operating income of $5.1 million, or 10.2% of
sales.  Net income for the quarter was $2.0 million, including a
$237,000 net loss from discontinued operations and a $261,000 loss
on sale related to the Company's Avure business, which the company
divested during the quarter and classified as a discontinued
operation.  Excluding the impact of the Avure business, income
from continuing operations for the quarter was $2.5 million.

By comparison, in the fiscal 2005 second quarter, FLOW reported
consolidated quarterly sales from continuing operations of $44.1
million and operating income of $2.2 million or 5.1% of sales.
The company reported a net loss of $275,000, including a net loss
of $1.2 million from discontinued operations related to the
divested Avure business.  The company reported income from
continuing operations of $955,000 in the year-ago period.

"With each quarter of sustained growth, cash generation, and
profitability, we further demonstrate our ability to move forward
as a highly motivated and focused organization," said Stephen R.
Light, Flow's President and Chief Executive Officer.  "As many of
our markets have continued to strengthen, so has our ability to
compete within those markets with superior technology and
support."

For the six months ended Oct. 31, 2006, FLOW reported consolidated
sales from continuing operations of $92.7 million, compared to
$82.4 million during the prior six-month period in fiscal 2005.
Including the impact of the discontinued Avure business, net
income for the six months ended Oct. 31, 2005 was $2.0 million
compared to a net loss of $2.6 million in the prior year.

                      Avure Divestiture

On Oct. 31, 2005 Flow completed the divestiture of its General
Press operations, which consisted of the North America Press and
the International Press segments, as well as the non-ultrahigh-
pressure portion of its Food segment.  The businesses were
acquired by an affiliate of Gores Technology Group, LLC, a Los
Angeles-based private equity firm for estimated net proceeds of
$14.4 million, comprised of cash and notes.  At closing, FLOW
entered into a supply agreement with Gores to design and
manufacture advanced high-pressure pumps for the food industry.

Flow International Corporation -- http://www.flowcorp.com/
-- is the world's leading developer and manufacturer of ultrahigh-
pressure waterjet technology for cutting, cleaning, and food
safety applications, providing state-of-the-art ultrahigh-pressure
(UHP) technology to industries including automotive, aerospace,
job shop, surface preparation, food and more.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 22, 2005,
Flow International Corporation (Nasdaq: FLOW) has been further
delayed from filing its Form 10-Q for the fiscal 2006 first
quarter ended July 31, 2005.  On Sept. 16, 2005, the Company filed
a Form 12b-25 to extend the filing date for its interim report,
extending the filing date to Sept. 19, 2005.  The Company did not
file the Form 10-Q on Sept. 19, 2005, and currently is unable to
predict when it will file the 10-Q.

The Company, after consultation with its Independent Registered
Public Accounting Firm has determined that it will restate its
financial results for the year ended April 30, 2005, as a result
of an error related to the valuation of anti-dilution warrants
issued to the Company's lenders on March 21, 2005.  The warrants
were issued as a result of the issuance of securities in a PIPE
transaction.  The amount of the restatement, which will result in
a non-cash adjustment, is estimated to be approximately $600,000
and will increase the Company's paid-in capital and net loss for
the year ended April 30, 2005.  The restatement for these warrants
will not have any effect on net shareholder's equity as of
April 30, 2005.

In conjunction with the Public Company Accounting Oversight
Board's inspection of the IRPAF, the IRPAF has advised that it
continues to complete required audit procedures in connection with
the 2005 financial statements.  Until the IRPAF has completed
these procedures and the 2005 financial statements are restated,
the Company will not be in a position to file the 10- Q for the
first quarter.


GE-WMC: Fitch Rates $14.9 Million Class B-5 Certificates at BB+
---------------------------------------------------------------
GE-WMC asset-backed pass-through certificates, series 2005-2,
which closed on Dec. 19, 2005, are rated by Fitch Ratings:

     -- $1,066,910,000 classes A-1, A-2a through A-2d 'AAA';
     -- $55,185,000 class M-1 'AA+';
     -- $51,647,000 class M-2 'AA+';
     -- $31,838,000 class M-3 'AA';
     -- $27,593,000 class M-4 'AA-';
     -- $24,762,000 class M-5 'A+';
     -- $23,348,000 class M-6 'A';
     -- $20,518,000 class B-1 'A-';
     -- $18,395,000 class B-2 'BBB+';
     -- $17,688,000 privately offered class B-3 'BBB';
     -- $16,273,000 privately offered class B-4 'BBB-';
     -- $14,858,000 privately offered class B-5 'BB+'.

The 'AAA' rating on the senior certificates reflects the 24.60%
initial credit enhancement provided by the 3.90% class M-1, the
3.65% class M-2, the 2.25% class M-3, the 1.95% class M-4, the
1.75% class M-5, the 1.65% class M-6, the 1.45% class B-1, the
1.30% class B-2, the 1.25% privately offered class B-3, the 1.15%
privately offered class B-4, the 1.05% privately offered class B-
5, and 3.25% initial and target overcollateralization.  All
certificates have the benefit of excess interest.

In addition, the ratings also reflect:

     * the quality of the loans,

     * the soundness of the legal and financial structures, and

     * the capability of Litton Loan Servicing LLP as servicer,
       which is rated 'RPS1' by Fitch.

The certificates are supported by two groups of collateral.  Group
I Mortgage Loans, which total $440,145,212 as of the cutoff date,
consist of fixed-rate and adjustable-rate mortgage loans secured
by first and second liens on mortgaged properties that have
original balances that conform to the guidelines of Fannie Mae and
Freddie Mac.  Approximately 14.52% of the mortgage loans are
fixed-rate mortgage loans and 85.48% are adjustable-rate mortgage
loans.  The weighted average loan rate is 7.486% and the weighted
average remaining term to maturity is 345 months.  The average
principal balance of the loans is $145,167, the weighted average
original loan-to-value ratio of 81.02% and the weighted average
credit score is 618.  The properties are primarily located in
California, Massachusetts and Maryland.

Group II Mortgage Loans, which total $1,030,494,291 as of the
cutoff date, consist of fixed-rate and adjustable-rate mortgage
loans secured by first and second liens on mortgaged properties
that have original principal balances that may or may not conform
to Fannie Mae and Freddie Mac guidelines.  Approximately 14.68% of
the mortgage loans are fixed-rate mortgage loans and 85.32% are
adjustable-rate mortgage loans.  The weighted average loan rate is
7.47% and the WAM is 338 months.  The average principal balance of
the loans is $240,489, the weighted average OLTV ratio is 83.15%
and the weighted average credit score is 644.  The properties are
primarily located in California, New York and New Jersey.

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 a private investment firm.  On
June 14, 2004, GE Consumer Finance acquired WMC Finance Co.


HEILIG-MEYERS: Court Confirms Amended Chap. 11 Liquidation Plan
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia
confirmed the Second Amended and Restated Joint Liquidating Plan
of Reorganization filed by Heilig-Meyers Company and certain of
its wholly owned subsidiaries -- Heilig-Meyers Furniture Company,
Heilig-Meyers Furniture West, Inc., HMY Star, Inc., and MacSaver
Financial Services, Inc. -- and the Official Committee of
Unsecured Creditors.

The Honorable Douglas O. Tice Jr. determined that the Plan met the
13 standards for confirmation required under Section 1129(a) of
the Bankruptcy Code.  The Plan:

     * properly classifies the claims,
     * specifies the unimpaired classes of claims,
     * specifies the treatment of unimpaired classes of claims,
     * provides for the same treatment of each claim in each
       class,
     * provides adequate and proper means for its
       implementation,
     * is not inconsistent with applicable provisions of the
       Bankruptcy Code,
     * complies with applicable provisions of the Bankruptcy
       Code,
     * was proposed in good-faith,
     * provides for the payment for services or costs and
       expenses in connection with the Debtors Chapter 11 cases,
     * provides for the proper treatment of administrative and
       tax claims pursuant to the requirements of Section
       1129((a)(9) of the Bankruptcy Code,
     * is feasible,
     * calls for the payment of fees payable under Section 1930
       of the Judiciary Procedures Code,
     * does not alter retiree benefits,
     * is fair and equitable, and
     * does not call for the avoidance of taxes or the
       application of Section 5 of the Securities Act of 1933.

The Plan contemplates the creation of a Liquidation Trust to
liquidate and make distributions of assets, and to administer the
resolution of the outstanding claims against the interests of the
Companies pursuant to the applicable sections of the Bankruptcy
Code.

It is anticipated that the assets of the Liquidation Trust will
include approximately 67% of the new common stock to be issued
pursuant to the Plan of Reorganization of RoomStore, Inc.,
formerly HMY RoomStore, Inc., which was confirmed by the
Bankruptcy Court on May 18, 2005, and became effective on June 1,
2005.  Under the terms of the RoomStore Plan, RoomStore emerged as
a reorganized business enterprise that operates 65 retail home
furnishings stores located in Pennsylvania, Maryland, Virginia,
North Carolina, South Carolina and Texas.

Heilig-Meyers Company filed for chapter 11 protection on
Aug. 16, 2000 (Bankr. E.D. Va. Case No. 00-34533), reporting
$1.3 billion in assets and $839 million in liabilities.  When the
Company filed for bankruptcy protection it operated hundreds of
retail stores in more than half of the 50 states.  In April 2001,
the company shut down its Heilig-Meyers business format.  In
June 2001, the Debtors sold its Homemakers chain to Rhodes, Inc.
GOB sales have been concluded and the Debtors are liquidating
their remaining Heilig-Meyers assets.  Bruce H. Matson, Esq., Troy
Savenko, Esq., and Katherine Macaulay Mueller, Esq., at LeClair
Ryan, P.C., in Richmond, Va., represent the Debtors.


HILITE INT'L: Weak Financial Performance Cues S&P's Negative Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' ratings on
Hilite International Inc. on CreditWatch with negative
implications.

The CreditWatch listing on Cleveland, Ohio-based Hilite reflects
S&P's concerns about:

     * the company's weak financial performance in 2005, which has
       led it to seek covenant relief and

     * the reduced likelihood that Hilite's credit protection
       measures will reach Standard & Poor's expectations in the
       year ahead.

Reduced original equipment manufacturer production volumes, price
concessions, unfavorable product mix, and high raw material costs
have led to Hilite's weak credit measures year-to-date in 2005.

The company had total balance sheet debt of $186 million at
Sept. 30, 2005.  Standard & Poor's expects to resolve the
CreditWatch listing after reviewing the company's prospects for
2006 and beyond.

"The ratings on privately held auto parts manufacturer Hilite
International Inc. reflect the highly competitive and cyclical
nature of the automotive market and the company's aggressive
financial profile," said Standard & Poor's credit analyst Nancy C.
Messer.

Hilite is controlled by its primary equity sponsors, Citicorp
Venture Capital, Kelso & Co., and Blue Point Capital Partners Fund
L.P.  The company supplies highly engineered transmission and
engine components, including electronic valves, to automotive
original equipment manufacturers and Tier I auto suppliers, with
about 40% of sales in the U.S. and 55% in Europe, including 25% in
Germany.

In addition to the highly competitive and cyclical nature of the
end market, Hilite's weak business position reflects the
comparatively narrow application of the company's products and its
relatively high fixed costs.  Also, as is typical of OEM
suppliers, Hilite's customer base lacks diversity, with the two
largest customers providing nearly 40% of 2004 revenues and the
top five automobile models accounting for about 30% of its total
sales.  Hilite procures various raw materials, including steel,
plastic, copper, and aluminum, all of which have experienced
increased pricing in the past year and a half.  The company
operates in the highly fragmented, engineered automotive
components business.  Its competitors are typically larger Tier I
suppliers for whom valve technology is not a core focus, though
they have considerable bargaining power given their size.

Still, Hilite's engine and transmission applications have a longer
life cycle than products designed for the vehicle interior or
exterior.  In the U.S. market, regulations supporting continued
emissions reductions and improved fuel efficiency offer growth
potential for Hilite's products.  In Europe, Hilite should benefit
some from the growing acceptance of automatic, rather than manual,
transmissions.


INEX PHARMACEUTICALS: Stark Wants Company Declared Bankrupt
-----------------------------------------------------------
Inex Pharmaceuticals Corporation (TSX: IEX) received notice on
Dec. 20, 2005, that Stark Trading and Shepherd Investments
International Ltd. filed a petition in the Supreme Court of
British Columbia seeking to have INEX declared bankrupt and that a
receiving order be made in respect of the property of INEX.

Stark is the majority holder of certain promissory notes issued by
Inex International Holdings, a subsidiary of INEX.  Other holders
of the notes have not filed a similar petition nor joined in
Stark's petition.  The promissory notes are not due until April
2007 and can be repaid in cash or in shares, at INEX's option, at
maturity.

INEX believes that this latest petition brought forward by Stark
is an attempt to block the successful completion of the Plan of
Arrangement announced Nov. 17, 2005.  As previously disclosed,
INEX has already asked the Supreme Court of British Columbia to
rule on whether the proposed plan can be completed given the terms
of the Notes.  The Supreme Court will hear this plan on Jan. 5 and
Jan. 6, 2006.  This hearing will also address Stark's bankruptcy
petition.

Timothy M. Ruane, President and Chief Executive Officer of INEX,
said INEX is continuing with its plan to spin out its Targeted
Immunotherapy assets into a new public company.  "This is yet
another attempt by Stark to try and block the completion of our
plan to spin out our Targeted Immunotherapy technology.  We
believe this transaction represents the greatest value for all
stakeholders, including the Note holders, and we will continue to
move forward to secure court and shareholder approvals for its
completion."

INEX Pharmaceuticals Corporation -- http://www.inexpharma.com/--  
is a Canadian biopharmaceutical company developing and
commercializing proprietary drugs and drug delivery systems to
improve the treatment of cancer.


INSIGNIA SOLUTIONS: Provides Update on Nasdaq Listing Status
------------------------------------------------------------
Insignia Solutions (Nasdaq:INSG) provided an update on matters
related to its listing on The Nasdaq Capital Market.

On Dec. 9, 2005, Insignia filed its Form 10-Q for the quarter
ended Sept. 30, 2005 with the Securities and Exchange Commission.
The company has been informed by Nasdaq that it will begin trading
under the symbol "INSG" effective Dec. 21, 2005 due to its having
achieved compliance with the filing requirement.  The company
traded under the symbol "INSGE" commencing Nov. 25, 2005,
indicating at that time that the company was not in compliance
with Marketplace Rule 4310(c)(14), which requires the timely
filing of periodic reports.

Additionally, Insignia reported that on Dec. 12, 2005, the company
received a Nasdaq Staff Determination letter indicating that the
company was not in compliance with Marketplace Rule 4320(e)(2)(B)
and that such noncompliance is a basis for delisting the company's
securities from The Nasdaq Stock Market.  Marketplace Rule
4320(e)(2)(B) requires a company to have a minimum of $2,500,000
in stockholders' equity or $35,000,000 market value of listed
securities or $500,000 of net income from continuing operations
for the most recently completed fiscal year or two of the three
most recently completed fiscal years.  As of Sept. 30, 2005,
Insignia reported stockholders' equity of $1,849,000, and market
value of its listed securities of $16,576,180.  Insignia has
reported losses from continuing operations in each of the three
most recently completed fiscal years.

Insignia had a hearing before a Nasdaq Listing Qualifications
Panel on Dec. 15, 2005, to review the determination.  During this
hearing, Insignia presented its plan to regain and sustain
compliance with the listing requirements.  Pending the outcome of
this hearing, Insignia's shares will remain listed on The Nasdaq
Capital Market.  However, there can be no assurance that the Panel
will grant the company's request for continued listing.

Insignia's plan of compliance is centered on the anticipated
closing of a private placement, which will bring its stockholders'
equity above the Nasdaq requirement.  The company has obtained
commitments from investors for approximately $2 million of equity
financing in a private placement, subject to certain closing
conditions.  The equity securities to be issued in the private
placement described in this release have not been registered with
the Securities and Exchange Commission, and may not be offered or
sold in the United States absent registration or an applicable
exemption from registration requirements.

"We are encouraged by recent progress in our efforts to strengthen
our capital position to enable us to continue to develop and sell
our mobile device management offerings to our customers around the
world," Mark McMillan, chief executive officer of Insignia, said.
"We continue to work to improve our capital position."

Headquartered in Fremont, California, Insignia Solutions PLC --
http://www.insignia.com/-- enables mobile operators and terminal
manufacturers to manage a growing, complex and diverse community
of mobile devices.  Insignia Device Management Suite is a complete
standard-based mobile device management offering, which includes
client provisioning technologies supported by most of the mobile
devices in the past, OMA-DM based technology used by current
mobile devices and future OMA-DM based technologies.

                          *     *     *

                       Going Concern Doubt

Burr, Pilger & Mayer LLP expressed substantial doubt about
Insignia's ability to continue as a going concern after it audited
the Company's financial statements for the years ended Dec. 31,
2004 and 2003.  The auditing firm pointed to the Company's
recurring losses from operations.


INTEGRATED SECURITY: Borrows $1.5M from Frost National Entities
---------------------------------------------------------------
Integrated Security Systems, Inc., issued three convertible
promissory notes to:

   * Frost National Bank FBO Renaissance Capital Growth & Income
     Fund III, Inc.;

   * Frost National Bank FBO Renaissance US Growth Investment
     Trust PLC; and

   * Frost National Bank FBO BFS US Special Opportunities Trust
     PLC

in exchange for an aggregate $1.5 million cash investment.

Each of the convertible promissory notes is in the original
principal amount of $500,000 and bears interest at an annual rate
of 8%.  Interest under the convertible promissory notes is payable
in quarterly installments and is payable, at the option of ISSI,
in cash or in shares of ISSI's common stock at a price of $0.25
per share.  The convertible promissory notes, plus any accrued and
unpaid interest, are due on December 14, 2008.  The convertible
promissory notes are convertible at the option of the holder into
shares of common stock of ISSI at a conversion price of $0.25 per
share, subject to standard anti-dilution adjustments.  ISSI has
the right to call the convertible promissory notes if the market
price of ISSI's common stock exceeds $0.60 per share for a period
of 60 days.

Full-text copies of the promissory notes are available for free
at:

   Investor         URL
   --------         ---
   Renn III         http://ResearchArchives.com/t/s?3da
   RUSGIT           http://ResearchArchives.com/t/s?3db
   BFS              http://ResearchArchives.com/t/s?3dc

To secure payment of ISSI's obligations under the convertible
promissory notes, ISSI and its wholly owned subsidiary, B&B ARMR
Corporation, entered into a security agreement with Renn III,
RUSGIT and BFS pursuant to which B&B ARMR granted a security
interest to Renn III, RUSGIT and BFS in B&B ARMR's equity interest
in B&B Roadway, LLC, a limited liability company in which B&B ARMR
owns a 65% interest.  A full-text copy of the Security Agreement
is available for free at http://ResearchArchives.com/t/s?3dd

Headquartered in Irving, Texas, Integrated Security Systems, Inc.
-- http://www.integratedsecurity.com/-- is a technology company
that provides products and services for homeland security needs.
ISSI also designs, develops and markets safety equipment and
security software to the commercial, industrial and governmental
marketplaces.  ISSI's Intelli-Site(R) provides users with a
software solution that integrates existing subsystems from
multiple vendors without incurring the additional costs associated
with upgrades or replacement.

At Sept. 30, 2005, the company's balance sheet showed a
stockholders' deficit of $4,716,688, up 33% from the $3,541,147
deficit reported at Dec. 31, 2004.

                         *     *     *

                      Going Concern Doubt

Weaver and Tidwell, LLP, expressed substantial doubt about the
company's ability to continue as a going concern after it audited
the company's financial statements for the fiscal year ended
June 30, 2004.  The auditors cited the company's significant
losses from operations for the year.  The company received a
similar opinion from its previous auditors, Grant Thornton LLP.


IPCS INC: Incurs $16.3 Mil. Net Loss in Quarter Ending Sept. 30
---------------------------------------------------------------
iPCS, Inc. (OTCBB: IPCX), a PCS Affiliate of Sprint Nextel,
reported financial and operational results for its fourth fiscal
quarter and fiscal year ended September 30, 2005.

Highlights for the Fourth Fiscal Quarter ended September 30, 2005:

   -- total revenues of approximately $109.1 million;

   -- net loss of approximately $16.3 million;

   -- adjusted EBITDA of approximately $15.7 million; results for
      the quarter included approximately $1.1 million in merger
      integration and Sprint litigation expenses;

   -- capital expenditures of approximately $4.4 million;

   -- as previously announced on October 31, 2005:

      * gross activations of approximately 60,300;
      * net additions of approximately 17,400;
      * monthly churn, net of 30 day deactivations, of 2.7%; and
      * ending subscribers of approximately 476,400.

"We were pleased with our results during the most recent quarter
and believe that they demonstrate continued successful execution
of our business strategy," remarked Timothy M. Yager, President
and Chief Executive Officer of the Company.  "Our strong
subscriber growth during the quarter demonstrates our continued
effort to expand distribution and realize significant growth
across our markets.  Additionally, we completed our merger with
Horizon PCS and achieved significant progress toward the
integration of the two companies and the realization of the
expected operational synergies."

Highlights for the Fiscal Year ended September 30, 2005:

   -- total revenues of approximately $280 million;
   -- net loss of approximately $50.9 million or $4.60 per share;
   -- adjusted EBITDA of approximately $43.4 million;
   -- capital expenditures of approximately $17.4 million.

"This past year has been one of successful transformation for iPCS
and we believe that during this period we achieved significant
operational progress," continued Mr. Yager.  "We have undertaken
important strategic steps to build a strong business foundation
and over the year our business has experienced results that
validate these initiatives. We remain very optimistic about the
future of iPCS."

On July 1, 2005, the Company completed its merger with Horizon
PCS, Inc., whereby Horizon PCS was merged with and into the
Company.  Accordingly, the results of the Company for the fiscal
year ended September 30, 2005 include results of Horizon PCS only
from and after July 1, 2005.

iPCS, Inc. -- http://www.ipcswirelessinc.com/-- is the PCS
Affiliate of Sprint with the exclusive right to sell wireless
mobility communications, network products and services under the
Sprint brand in 80 markets including markets in Illinois,
Michigan, Pennsylvania, Indiana, Iowa, Ohio and Tennessee.  The
territory includes key markets such as Grand Rapids (MI), Fort
Wayne (IN), Tri-Cities (TN), Quad Cities (IA/IL), Scranton (PA)
and Saginaw-Bay City (MI).  As of June 30, 2005 and giving effect
to the July 1, 2005 completion of its merger with Horizon PCS,
iPCS's licensed territory had a total population of approximately
15.0 million residents, of which its wireless network covered
approximately 11.3 million residents, and had approximately
459,000 subscribers.  iPCS is headquartered in Schaumburg,
Illinois.

On Feb. 23, 2003, iPCS and its wholly owned subsidiaries filed
voluntary petitions seeking relief from creditors pursuant to
Chapter 11 of the Bankruptcy Code in the United States Bankruptcy
Court for the Northern District of Georgia.  iPCS filed its plan
of reorganization with the Bankruptcy Court on March 31, 2004. On
April 30, 2004, iPCS Escrow Company, a newly formed, wholly owned
indirect subsidiary of iPCS, completed an offering of $165.0
million aggregate principal amount of 11.50% senior notes due
2012. The Company's plan of reorganization was confirmed on July
9, 2004 and declared effective on July 20, 2004.

With the effectiveness of the plan of reorganization, iPCS Escrow
Company was merged with and into iPCS and the senior notes became
senior unsecured obligations of iPCS.  Other significant items of
the reorganization that occurred on July 20, 2004, included the
repayment and cancellation of iPCS' senior credit facility from
the proceeds of the $165.0 million senior notes offering, the
cancellation of its common stock held by a liquidating trust, the
cancellation of its $300.0 million 14% senior notes along with
other unsecured claims in exchange for the Company's new common
stock, the assumption of its amended Sprint affiliation agreements
and the settlement of its previously stayed litigation against
Sprint.

                         *     *     *

As reported in the Troubled Company Reporter on July 22, 2005,
Standard & Poor's Ratings Services affirmed its ratings on
Schaumburg, Illinois-based Sprint PCS affiliate iPCS Inc.,
including its 'CCC+' corporate credit rating and 'CCC' senior
unsecured debt rating.  S&P said the outlook is developing.

Standard & Poor's also affirmed its 'CCC' rating on the senior
unsecured debt of another Sprint PCS affiliate, Horizon PCS Inc.
These affirmations follow the recently completed merger of Horizon
into iPCS Inc.  Under the terms of the merger agreement, iPCS
became the obligor of Horizon PCS's $125 million senior notes.
Pro forma for the merger, total debt outstanding is about
$290 million.


JACOBS INDUSTRIES: Wants Court to Approve Bidding Procedures
------------------------------------------------------------
Jacobs Industries, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Eastern District of Michigan to approve
the bidding and sale procedures for the sale of substantially all
of their assets free and clear of all liens and interests.

              Summary of the Bidding Procedures

1) Participation Requirements

   Each potential bidder interested in participating in the sale
   process, regardless of whether a stalking horse bidder has been
   selected or the Debtors are conducting an auction without a
   stalking horse bidder, must deliver to the Debtors all
   financial documents, financing commitments and other necessary
   documents as the potential bidder believes will provide
   adequate assurance to the Debtors of that bidder's ability to
   close a sale transaction.

2) Qualified Bidder

   A qualified bidder should demonstrate to the Debtors'
   customers, Daimler Corporation, PPG Industries Inc., Android
   Industries LLC, Schlegel Corporation and General Motors
   Corporation, that it possesses the capabilities to operate as a
   supplier to those Customers and will agree to assume all of the
   respective Customers' Purchase Orders.

   The qualified bidder should also deliver to the Debtors:

  a) financial disclosures and other information acceptable to the
     Debtors and their financial advisors after consultation with
     the Secured Lenders and the Unsecured Creditors Committee to
     prove that bidder's abilities to consummate a sale;

  b) a fully executed agreement stating that any qualified bid
     made by a potential bidder will be irrevocable until the
     asset sale is fully consummated by the Debtors regardless of
     whether the asset sale occurs to the potential bidder or to
     another party;

  c) a qualified bid in writing signed by the potential bidder, to
     be delivered to the Debtors' counsel and copies delivered to
     the counsel for the Unsecured Creditors Committee, the
     Secured Lenders, and other parties to appear in the Notice of
     Sale; and

  d) a $500,000 Good Faith Deposit in certified check or wired
     funds, or five percent of the qualified bid, whichever is
     higher.

3) Auction

   If there is one qualified bid other than the initial accepted
   offer, the Debtors may conduct an auction for the assets and to
   commence three days prior to the sale hearing.

   The proposed auction will be held at the offices of:

        Schafer and Weiner, PLLC
        40950 Woodward Ave., Ste 100
        Bloomfield Hills, Michigan 48304

4) Sale Closing, Break-Up Fess & Escrow of Good Faith Deposit

   Unless otherwise ordered by the Court, the closing date for the
   asset sale will occur no later than Jan. 31, 2006.  The Debtors
   are authorized to pay a break-up fee to the stalking horse
   bidder in the event another party with a higher and better
   offer for the assets wins in an auction.  The $500,000 Good
   Faith Deposit of the qualified bidders will be held in an
   escrow account until the earlier of the closing of the sale or
   Jan. 31, 2006.

A full-text copy of the proposed bidding procedures is available
for free at:

     http://bankrupt.com/JacobsIndustriesBiddingProcedures.pdf

Headquartered in Fraser, Michigan, Jacobs Industries, Inc.,
manufacturs automotive interiors in roll forming and channel,
stampings and assembled product.  The company along with its three
affiliates filed for chapter 11 protection on Sept. 26, 2005
(Bankr. E.D. Mich. Case No. 05-72613).  Charles J. Taunt, Esq.,
and Erika D. Hart, Esq., at Charles J. Taunt & Associates,
P.L.L.C., represents the Debtors in their restructuring.  When the
Debtor filed for protection from its creditors, it listed
$19,513,913 in total assets and $21,413,576 in total debts.


KAISER ALUMINUM: Wants CII Carbon's Settlement Objection Overruled
------------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
December 7, 2005, CII Carbon, L.L.C., asks the U.S. Bankruptcy
Court for the District of Delaware to deny Kaiser Aluminum
Corporation and its debtor-affiliates' settlement agreement with
CNA and National Union.

Jeffrey C. Wisler, Esq., at Connolly, Bove, Lodge & Hutz LLP, in
Wilmington, Delaware, relates that CII holds a valid and
enforceable property damage claim against the Debtors and other
parties determined to be at fault in causing the explosion for the
cost of repairing the property damage to the coke plant and the
equipment.

CII also holds a valid and enforceable additional claim for extra
expenses CII incurred in transporting and processing raw materials
for resale to its customers, as well as lost profits from
inability to operate its boiler following the explosion.

Moreover, Mr. Wisler says there is no factual basis upon which the
Court can approve the release of CII's claims against the non-
debtor Insurers.  The Court must both scrutinize whether the
proposed release is fair and made in exchange for reasonable
consideration, and determine that the Settlement Agreement is
necessary to the Debtors' reorganization.

The Settlement Agreement is not in the best interests of the
estate, Mr. Wisler adds.  The Debtors have failed to meet their
burden to establish that releasing their Insurers from liability
for more than $16,000,000 of claims asserted by CII is in the best
interests of the estate.

                            *    *    *

The Debtors ask the Court to overrule CII Carbon's objection and
approve the settlement agreement.

Kimberly D. Newmarch, Esq., at Richards, Layton & Finger in
Wilmington, Delaware, tells the Court that while CII Carbon
mentions that its claims against Kaiser Aluminum and Chemical
Corporation are the subject of a pending Louisiana state court
action that is currently on appeal, it fails to inform the Court
that the trial court granted summary judgment against CII Carbon
on its additional claim.  Moreover, almost six years have passed
since the Gramercy Explosion, and CII Carbon has never sued the
insurers for any damages resulting from the Gramercy Explosion nor
joined the insurers in the Louisiana state court lawsuit that
commenced in June 2000.

The remaining unexhausted coverage under the insurers' policies
only covers KACC's liabilities resulting from bodily injury,
property damage, personal injury or advertising injury.  CII
Carbon's additional claim, however, is for breach of contract,
specifically those in the Powerhouse Agreements between KACC, CII
Carbon and LaRoche Industries, Inc., relating to the powerhouse
facility inside the Gramercy Plant.  Pursuant to the Powerhouse
Agreements, LII transferred boiler feed water and natural gas that
it received from the powerhouse facility to CII Carbon, which used
the energy to generate steam that it, in turn, provided to KACC
for use at the powerhouse facility.

This relationship was interrupted not only by the Gramercy
Explosion in July 1999 but also by LII's subsequent bankruptcy
filing in May 2000.  Notwithstanding CII Carbon's characterization
of its additional claim as sounding in both tort and contract, the
fundamental premise of the claim is that KACC and LII failed to
perform their contractual obligations under the Powerhouse
Agreements.

Ms. Newmarch notes that the direct action statute on which CII
Carbon relies to assert it has rights against the insurers,
however, only gives an injured party the right to sue a
wrongdoer's insurer with respect to tort claims.

She points out that more importantly, even if CII Carbon's
additional claim could be characterized as a tort, the damages
flowing from that claim cannot be categorized as bodily injuries,
property damage, personal injuries or advertising injuries so as
to be covered by the insurers' policies.  CII Carbon has no basis
to complain of the scope of the insurers' release because CII
Carbon simply will not be affected by the release given that the
only claim that is even arguably entitled to insurance coverage is
fully protected by funds that are to be set aside, she adds.

On CII Carbon's argument that Court does not have jurisdiction
over the released claims of CII Carbon because these are separate
and independent of the Debtors' bankruptcy cases, Ms. Newmarch
argues that CII Carbon ignores its own argument that its claims
implicate KACC's insurance, which is property of KACC's estate.
Moreover, she says, the settlement agreement is a global
settlement with the insurers regarding insurance coverage issues
related to the Gramercy Explosion, and to the extent CII Carbon's
purported right to bring a direct action against the insurers is
not extinguished, it may interfere with the ability of KACC's
estate to obtain the substantial benefits under the settlement.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
February 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold
off a number of its commodity businesses during course of its
cases.  Corinne Ball, Esq., at Jones Day, represents the Debtors
in their restructuring efforts.  On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 85; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


KMART CORP: Asks Court for Final Decree Closing Eight Cases
-----------------------------------------------------------
Pursuant to Section 350(a) of the Bankruptcy Code and Rule 3022 of
the Federal Rules of Bankruptcy Procedure, Kmart Corporation asks
the U.S. Bankruptcy Court for the Northern District of Illinois to
issue a final decree closing these Chapter 11 cases:

        Debtor                                   Case No.
        ------                                   --------
        Kmart Corporation of Illinois, Inc.      02-02462
        Kmart of Indiana                         02-02463
        Kmart of Pennsylvania LP                 02-02464
        Kmart of North Carolina LLC              02-02465
        Kmart of Texas, L.P.                     02-02466
        Bluelight.Com LLC                        02-02467
        Kmart Stores of Indiana, Inc.            02-02480
        Kmart of Michigan, Inc.                  02-02481

William J. Barrett, Esq., at Barack Ferrazzano Kirschbaum
Perlman & Nagelberg LLP, in Chicago, Illinois, informs Judge
Sonderby that the Closing Debtors' bankruptcy cases have been
substantially consummated.  These Debtors have been revested with
their assets in accordance with the First Amended Joint Plan of
Reorganization.  The Closing Debtors do not have unperformed
obligations under the Plan, Mr. Barrett says.

According to Mr. Barrett, if the Court grants the request, only
Kmart Corporation's Chapter 11 proceeding, with Case No. 02-02474,
will remain open.

Mr. Barrett notes that all claims, if any, against the Closing
Debtors are deemed by the Plan to be against the substantively
consolidated estate of Kmart Corporation.  All of the
responsibilities for administering the Plan, resolving claims and
making distributions to creditors lie with Kmart Corporation.

Closing the Closing Debtors' cases will not prejudice the rights
of their creditors under the Plan, Mr. Barrett assures the Court.
The Plan will remain fully operative and enforceable against
Kmart, which has the responsibility of administering the Plan and
the claim allowance process, and also making the required
distributions.

Section 350(a) states that, after an estate is fully administered,
"the court shall close the case."  Moreover, Bankruptcy Rule 3022
provides that "[a]fter an estate is fully administered in a
chapter 11 reorganization case, the court, on its own motion or on
motion of a party in interest, shall enter a final decree closing
the case."

Mr. Barrett notes that the Bankruptcy Code does not define "fully
administered."  However, the Court has employed these factors when
determining whether a Chapter 11 case has been fully administered:

   (1) whether the order confirming the plan has become final;

   (2) whether deposits required by the plan have been
       distributed;

   (3) whether the property proposed by the plan to be
       transferred has been transferred;

   (4) whether the debtor or the successor of the debtor under
       the plan has assumed the business or the management of the
       property dealt with the plan;

   (5) whether payments under the plan have commenced; and

   (6) whether all motions, contested matters, and adversary
       proceedings have been finally resolved.

In the Closing Debtors' cases, each of these factors has been met,
Mr. Barrett maintains.  "Quite simply, there is nothing left to do
in the Closing Debtors' cases, and these cases are, but for
technicality of entry of a Final Decree, completed."

Kmart also asks the Court to hear the motion before December 31,
2005.  Mr. Barrett explains that if the Court grants the request
before that time, the United States Trustee's fees will cease to
accrue.  If it is not heard until the omnibus hearing on
January 17, 2006, substantial additional fees will have accrued on
cases that no longer require any oversight by the U.S. Trustee.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S.
Virgin Islands and Guam.  The Company filed for chapter 11
protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate,
Meagher & Flom, LLP, represented the retailer in its restructuring
efforts.  The Company's balance sheet showed $16,287,000,000 in
assets and $10,348,000,000 in debts when it sought chapter 11
protection.  Kmart bought Sears, Roebuck & Co., for $11 billion to
create the third-largest U.S. retailer, behind Wal-Mart and
Target, and generate $55 billion in annual revenues.  The
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act expired on Jan. 27, without complaint by the Department of
Justice.  (Kmart Bankruptcy News, Issue No. 105; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


KMART CORP: Settles Dispute Over Dutch Farm's $2.3 Million Claim
----------------------------------------------------------------
Dutch Farms, Inc., and Kmart Corporation have informed the Court
that they have resolved the disputes between them through a
settlement.  Thus, Judge Sonderby rules that Kmart's objection to
Dutch Farms' Claim No. 13992 and Dutch Farms' request to allow the
Claim are both withdrawn as moot.

As reported in the Troubled Company Reporter on September 30,
2005, Dutch Farms, Inc., a food service vendor of Kmart
Corporation, asserted, among others, Claim No. 13992 for
$2,311,710 in Kmart's Chapter 11 case.  Pursuant to an omnibus
objection filed by Kmart, Claim No. 13992 is Dutch Farms' sole
remaining claim.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S.
Virgin Islands and Guam.  The Company filed for chapter 11
protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate,
Meagher & Flom, LLP, represented the retailer in its restructuring
efforts.  The Company's balance sheet showed $16,287,000,000 in
assets and $10,348,000,000 in debts when it sought chapter 11
protection.  Kmart bought Sears, Roebuck & Co., for $11 billion to
create the third-largest U.S. retailer, behind Wal-Mart and
Target, and generate $55 billion in annual revenues.  The
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act expired on Jan. 27, without complaint by the Department of
Justice.  (Kmart Bankruptcy News, Issue No. 105; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


LA QUINTA: Launches Offers for Outstanding Debt Securities
----------------------------------------------------------
La Quinta Properties, Inc. commenced cash tender offers for any
and all of its outstanding:

    * 8-7/8% Senior Notes due March 15, 2011,
    * 7% Senior Notes due August 15, 2012,
    * 7% Notes due August 15, 2007,
    * 7.27% Medium Term Notes due February 26, 2007 and
    * 7.33% Medium Term Notes due April 1, 2008,

as well as related consent solicitations to amend such Notes and
the indentures pursuant to which they were issued.  The tender
offers and consent solicitations are being conducted in connection
with the previously announced agreement of La Quinta Corporation
(NYSE: LQI) and La Quinta Properties, Inc. to merge with
affiliates of The Blackstone Group.

The consent solicitations will expire at 5:00 p.m., New York City
time on Friday, Jan. 6, 2006, unless extended or earlier
terminated by the Company.  Tendered Notes may not be withdrawn
and consents may not be revoked after the Consent Expiration Date.
The tender offers will expire at 8:00 a.m., New York City time on
Wednesday, Jan. 25, 2006, unless extended or earlier terminated by
the Company.

Holders tendering their Notes will be required to consent to
proposed amendments to the Notes and to the indentures governing
the Notes, which will eliminate substantially all of the
restrictive covenants contained in the indentures and the Notes
(except for certain covenants related to asset sales and change of
control offers), as well as certain events of default and modify
covenants regarding mergers to permit mergers with limited
liability companies and provisions regarding defeasance or
satisfaction and discharge to eliminate certain conditions, as
well as modify or eliminate certain other provisions contained in
the indentures and the Notes.  Holders may not tender their Notes
without also delivering consents or deliver consents without also
tendering their Notes.

The total consideration for each $1,000 principal amount of Notes
validly tendered and not withdrawn pursuant to the tender offers
is the price equal to:

    (i) the sum of:

         (a) the present value, determined in accordance with
             standard market practice, on the payment date for
             Notes purchased in the tender offers of $1,000 (or,
             in the case of the 8 -/8% Notes and the 7% Notes due
             2012, $1,044.38 and $1,035.00, respectively) plus

         (b) the present value of the interest that accrues and is
             payable from the last interest payment date prior to
             the payment date until the applicable maturity date
              (or, in the case of the 8-7/8% Notes and the 7%
             Notes due 2012, the earliest scheduled redemption
             dates of March 15, 2007 and August 15, 2008,
             respectively) for the Notes, in each case determined
             on the basis of a yield to such maturity date (or, in
             the case of the 8-7/8% Notes and the 7% Notes due
             2012, the earliest scheduled redemption date) equal
             to the sum of (A) the yield to maturity on the
             applicable U.S. Treasury Security, as calculated by
             Bear, Stearns & Co. Inc. in accordance with standard
             market practice, based on the bid-side price of such
             Reference Security as of 2:00 p.m., New York City
             time, on the second business day immediately
             preceding the Offer Expiration Date, as displayed on
             the applicable page of the Bloomberg Government
             Pricing Monitor specified in the table or any
             recognized quotation source selected by Bear, Stearns
             & Co. Inc. in its sole discretion if the Bloomberg
             Government Pricing Monitor is not available or is
             manifestly erroneous, plus (B) 50 basis points, minus

   (ii) accrued and unpaid interest to, but not including, the
        payment date.

The Total Consideration includes a consent payment of $30.00 per
$1,000 principal amount of Notes payable in respect of Notes
validly tendered and not withdrawn and as to which consents to the
proposed amendments are delivered on or prior to the Consent
Expiration Date.  Holders of the Notes must validly tender and not
withdraw Notes on or prior to the Consent Expiration Date in order
to be eligible to receive the Total Consideration for such Notes
purchased in the tender offers.  Holders who validly tender their
Notes after the Consent Expiration Date and on or prior to the
Offer Expiration Date will be eligible to receive an amount, paid
in cash, equal to the Total Consideration less the $30.00 Consent
Payment.  In each case, Holders whose Notes are accepted for
payment in the Offers shall receive accrued and unpaid interest in
respect of such purchased Notes from the last interest payment
date to, but not including, the payment date for Notes purchased
in the offers.

The table shows a summary of certain terms of the tender offers.

                    Aggregate
                    Principal
                     Amount          Security     Reference
      CUSIP No.    Outstanding     Description    Security
      ---------    ------------    -----------    --------
      50419QAD4    $325,000,000    8-7/8% Senior  3.375% US
                                   Notes due      Treasury Note
                                   Mar. 15, 2011  due 2/28/07

      50419QAF9    $200,000,000    7% Senior      3.25% US
                                   Notes due      Treasury Note
                                   Aug. 15, 2012  due 8/15/08

      58501TAJ7    $160,000,000    7% Notes due   2.75% US
                                   Aug. 15, 2007  Treasury Note
                                                  due 8/15/07

      50419EAB5     $50,000,000    7.27% Medium   2.25% US
                                   Term  Notes    Treasury Note
                                   due Feb. 26,   due 2/15/07
                                   2007

      50419EAC3     $50,000,000    7.33% Medium   3% US
                                   Term Notes     Treasury Note
                                   due Apr. 1,    due 2/15/08
                                   2008

The tender offers and consent solicitations are made upon the
terms and conditions set forth in the Offer to Purchase and
Consent Solicitation Statement, dated Dec. 20, 2005, and the
related Consent and Letter of Transmittal.  The tender offers are
subject to the satisfaction of certain conditions, including
receipt of consents sufficient to approve the proposed amendments
and the mergers having occurred, or shall be occurring,
substantially concurrent with the Offer Expiration Date.  Further
details about the terms and conditions of the tender offers and
the consent solicitations are set forth in the Offer to Purchase.

The Company has retained Bear, Stearns & Co. Inc. and Morgan
Stanley & Co. Incorporated to act as the Dealer Managers for the
tender offers and Solicitation Agents for the consent
solicitations and they can be contacted at (877) 696-BEAR (toll-
free) and (800) 624-1808 (toll-free), respectively.  The documents
relating to the tender offers and consent solicitations are
expected to be distributed to holders beginning Dec. 20, 2005.
Requests for documentation may be directed to D.F. King & Co.,
Inc., the Information Agent, which can be contacted at (212) 269-
5550 (for banks and brokers only) or (888) 644-5854 (for all
others toll-free).

La Quinta Corporation -- http://www.LQ.com/-- and its controlled
subsidiary, La Quinta Properties, Inc. (NYSE: LQI) is one of the
largest owner/operators of limited-service hotels in the United
States. Based in Dallas, Texas, the Company owns and operates 360
hotels and franchises more than 240 hotels in 39 states under the
La Quinta Inns(R), La Quinta Inn & Suites(R), Baymont Inn &
Suites(R), Woodfield Suites(R) and Budgetel(R) brands.

                        *     *     *

As reported in the Troubled Company Reporter on Nov. 16, 2005,
Fitch Ratings placed La Quinta Corp. on Rating Watch Negative.
The affected ratings include:

     -- Issuer default rating 'BB-';
     -- Senior secured credit facility 'BB';
     -- Senior unsecured rating 'BB-';
     -- Preferred stock rating 'B'.

As reported in the Troubled Company Reporter on Nov. 14, 2005,
Standard & Poor's Ratings Services placed its ratings on La Quinta
Corp., including its 'BB' corporate credit ratings, on CreditWatch
with developing implications.  Irving, Texas-based La Quinta owns,
operates, and franchises 604 hotels as of Sept. 30, 2005.


LANCASTER REDEV'T: S&P Shaves Tax Debt Ratings to BB+ from BBB-
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Lancaster
Redevelopment Agency, California's tax allocation debt, issued for
the Fox Field redevelopment project, one notch to 'BB+' from
'BBB-' due to declines in total and unsecured fiscal 2006 assessed
valuation causing debt service coverage to decrease below 1x.

The rating also reflects a very high taxpayer concentration at 65%
of incremental assessed value within the 10 leading taxpayers and
33% within the leading taxpayer and a history of property value
losses in the mid- to late-1990s.

A low volatility ratio is a mitigating strength.

"We assume the largely undeveloped project area's projected growth
should cause assessed value and pledged revenues to improve,
strengthening long-term debt service coverage," said Standard &
Poor's credit analyst Sussan Corson.

A first lien on incremental property taxes derived from the
agency's Fox Field redevelopment project area, net of housing
set-asides, except for a small portion used to cover previous
housing project debt, and net of various pass-through agreements
with Antelope Water District and Los Angeles County on behalf of a
consolidated fire protection district, secures the bonds.

The 3,300-acre Fox Field project area encompasses two
noncontiguous areas consisting of a large amount of undeveloped
land and industrial property.  The agency has acquired acreage
throughout the project area with a goal to subdivide parcels
desirable to industrial and commercial properties. Although
total property value had increased by 63% since fiscal 2000 to
$113.7 million in fiscal 2005, a decline in unsecured fiscal 2006
value caused total assessed value to decline by 2.5% in fiscal
2006 to $111.0 million.  Fiscal 2006 pledged revenues of $178,000
only cover maximum annual debt service by 0.94x.  Despite a lack
of coverage, the agency has historically used revenues from other
project areas to make debt service payments on the bonds.

The rating action affects roughly $2.5 million of tax allocation
debt outstanding.


LB COMM'L: S&P Upgrades Rating on Class F Certificates
------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on four
classes of LB Commercial Mortgage Trust's commercial mortgage
pass-through certificates from series 1998-C4.  At the same
time, ratings are affirmed on five other classes from the same
series.

The rating actions reflect credit enhancement levels that
adequately support the raised and affirmed ratings.

Per the remittance reported dated Dec. 15, 2005, the trust
collateral consisted of 251 loans with an aggregate outstanding
principal balance of $1.583 billion, down from 285 loans with a
balance of $2.025 billion at issuance.  The master servicer,
Wachovia Securities N.A., provided partial- or full-year 2004 net
cash flow debt service coverage figures for 98% of the
non-defeased pool.  There are 36 loans in the pool that have been
defeased.  Based on this information, Standard & Poor's calculated
a weighted average DSC of 1.79x, up from 1.67x at issuance.  The
largest loan in the pool, TRT Holdings, was previously with the
special servicer.  If this loan continues to perform and
pays off at maturity in 2008, there will be a significant interest
shortfall caused by the corrected mortgage fee.  If the fee is not
spread over multiple pay periods, the shortfall may reach as high
as class C.  The anticipated shortfall was considered during
Standard & Poor's rating analysis, and constrained the upgrades.
There is one loan in foreclosure, which is with the special
servicer and is discussed below.  The remaining loans
in the pool are current.

The top 10 loans secured by real estate assets have an aggregate
outstanding balance of $708.9 million.  The top 10 loans reported
a weighted average DSC of 2.13x, compared with 2.07x at issuance.
Standard & Poor's reviewed recent property inspections provided by
Wachovia for assets underlying the top 10 loans, and all were
characterized as "excellent" or "good." However, the third-,
seventh-, and 10th-largest loans are on the watchlist.

Wachovia reported 63 loans on its watchlist as of Dec. 15, 2005.
These loans had an aggregate outstanding balance of $357 million.
The third-largest real estate exposure in the pool, Arden II, is
secured by 12 office properties located through Southern
California.  The loan is on the watchlist due to major deferred
maintenance issues at one of the properties.  The loan will be
removed from the watchlist once the issues are resolved.  The 2004
weighted average DSC for the loan was 3.11x.  The seventh-largest
real estate exposure in the pool, Hundred Oaks Shopping Center, is
a 703,574-sq.-ft. retail property in Nashville, Tennessee.  The
loan appears on the watchlist because of a decrease in cash flow.
The property has shown improvement in income and a decrease in
expenses for first six months of 2005.  Year-to-date DSC as of
June 30, 2005, was 1.35x.  The 10th-largest real estate exposure,
Park at Memorial Apartments is a 316-unit multifamily property
located in Oklahoma City, Oklahoma.  The loan appears on the
watchlist because of a decrease in cash flow.  The DSC for
year-end 2004 was 1.08x.

There are five loans with the special servicer, LNR Partners Inc.
45 Executive Drive is a 66,801-sq.-ft. office building in
Plainview, New York, with an outstanding loan balance of
$6.2 million and a total exposure of $8 million.  The loan was
transferred to the special servicer because the borrower filed for
bankruptcy and the loan is currently in foreclosure.  The borrower
is trying to get the loan reinstated.

Three loans are with the special servicer because Winn Dixie
rejected leases at the collateral properties.  The borrower for
the Warlick Plaza located in Newton, North Carolina, has signed a
lease with Honey Supermarket to replace the Winn Dixie store.  The
borrower for Pinebrook Village in Pineville, Louisiana, is in
negotiations with a prospective tenant, Super One Grocery, to
replace Winn Dixie.  Finally, the borrower for Clarksville
Crossing located in Clarksville, Virginia, is waiting for approval
on a lease signed with Dollar General to take over the Winn Dixie
space.

The final loan with the special servicer is Sharon Lakes Plaza,
which is secured by a 51,732-sq.-ft. retail center in Charlotte,
North Carolina.  The loan was transferred to the special servicer
for maturity default.  This loan reported a DSC of 0.96x for 2004.

Based on discussions with the servicer, Standard & Poor's stressed
various loans in the mortgage pool as part of its analysis.  The
resultant credit enhancement levels adequately support the raised
and affirmed ratings.

                         Ratings Raised

                  LB Commercial Mortgage Trust
       Commercial Mortgage Pass-Thru Certs Series 1998-C4

                       Rating
            Class   To         From   Credit support
            -----   --         ----   --------------
            C       AA+        A+             20.73%
            D       AA         BBB+           13.05%
            E       A          BBB            11.13%
            F       BBB+       BB+             7.93%

                        Ratings Affirmed

                  LB Commercial Mortgage Trust
       Commercial Mortgage Pass-Thru Certs Series 1998-C4

                 Class   Rating   Credit support
                 -----   ------   --------------
                 A-1-a   AAA              34.16%
                 A-1-b   AAA              34.16%
                 A-2     AAA              34.16%
                 B       AAA              27.44%
                 X       AAA                N/A

                      N/A - Not applicable.


LEVITZ HOME: Court Denies Implementation of KERP
------------------------------------------------
As previously reported in the Troubled Company Reporter on Dec. 1,
2005, pursuant to Sections 363 and 105 of the Bankruptcy Code,
Levitz Home Furnishings, Inc., and its debtor-affiliates seek the
U.S. Bankruptcy Court for the Southern District of New York's
consent to implement a retention plan and a modified severance
program for certain executives and key employees.

                       Objections

A. Ad Hoc Committee of Noteholders

An Ad Hoc Committee of Holders of 12.5% Senior Secured Class A
Notes issued by Levitz Home Furnishings, Inc., asserts that the
expenditure of more than $1,000,000 in rewards to senior
management, plus more than $4,000,000 of severance pay promises,
is wholly inappropriate in a case teetering on the verge of
administrative insolvency.

"To force the Senior Secured Noteholders to suffer the cost of
management rewards and golden parachutes is to rub salt in the
wounds of their catastrophic losses already incurred to date,"
Susheel Kirpalani, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
in New York, says.

B. Creditors Committee

On behalf of the Official Committee of Unsecured Creditors, Jay
R. Indyke, Esq., at Kronish Lieb Weiner & Hellman LLP, in New
York, asserts that the Proposal is unwarranted in the Debtors'
Chapter 11 cases, where the Debtors have already agreed to sell
substantially all of their assets in an extremely truncated time,
and none of the myriad of retained professionals can assure the
Creditors Committee that the net proceeds of the Sale will insure
the administrative solvency of the cases.

The goal of these Chapter 11 proceedings is to expedite a Sale
process, which maximizes recovery to the Debtors' estates and
their creditors, while minimizing expenses, Mr. Indyke notes.
The facts and circumstances of these cases simply do not warrant
implementation of a KERP or Severance Program for the Executives.

                    *     *     *

After due deliberation, the Court denies, with prejudice, the
Debtors' request to implement the KERP.

The Court, however, authorizes the Debtors to implement an
"Approved Severance Program" under which a Key Employee
Participant whose employment is terminated during the Debtors'
Chapter 11 cases will be entitled to receive:

   (a) three months of salary if the Key Employee had been
       employed by a Debtor for less than 10 years; or

   (b) four months of salary if the Key Employee had been
       employed by a Debtor for 10 years or more.

A Key Employee's Severance Claim will be an allowed
administrative expense of the Debtors' estates that, in
consultation with the Committees regarding appropriate recovery
estimates and reserves to avoid overpayments, may be paid by the
Debtors without further Court order.

Without prejudice to a particular Key Employee's rights to seek
allowance of some other alleged right to severance as
administrative expense of the Debtors' estates, a Key Employee
will not be entitled to participate in the Approved Severance
Program or receive any payment on account of a Severance Claim
if:

   (a) the Key Employee does not waive and release all rights to
       any severance, benefits or employment-related payments
       other than its Severance Claim under the Approved
       Severance Program within 10 days of his or her employment
       being terminated by the Debtors;

   (b) the Key Employee voluntarily terminates his or her
       employment;

   (c) the Key Employee is terminated for "cause";

   (d) the Key Employee receives an offer for employment with a
       successor to the Debtors or a purchaser of the Debtors'
       business or assets that would provide the Key Employee
       with duties, level of corporate responsibility, base
       salary, and total compensation and benefits package that
       are substantially similar to the Key Employee's position
       with the Debtors on the Petition Date; or

   (e) the Debtors' convert their Chapter 11 cases to cases under
       Chapter 7 without the prior consent of the Committees.

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States.  The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189).  David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. (Levitz Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


LEVITZ HOME: Gets Court OK to Reject Nine Store Lease Agreements
----------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
Nov. 23, 2005, as part of its restructuring strategy, Levitz Home
Furnishings, Inc., has closed and vacated certain store locations,
as well as certain clearance centers, distribution centers, and
office space.

On April 8, 2005, Levitz' Board of Directors approved the plan
to, among other things, close all Seaman and Seaman Kids' stores
and to reopen 23 of those showrooms under the Levitz brand.

Richard H. Engman, Esq., at Jones Day, in New York, relates that
Levitz Home Furnishings, Inc., and its debtor-affiliates also have
begun the process of reviewing certain of their remaining leases,
for both closed and operating locations, to determine whether
continuing to operate from those locations is in their best
interests.

Pursuant to Section 365(a) of the Bankruptcy Code, Levitz Home
Furnishings, Inc., and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
to reject nine leases effective on the later of the Petition Date
or the date the Debtors vacate the premises.

                      *     *     *

The Court authorizes the Debtors to reject nine-store lease
agreements for these premises:

   Premises                                      Effective Date
   --------                                      --------------
   Levitz Store, Astoria, NY                      11/9/2005
   Seaman's Store, Brooklyn, NY                   Petition Date
   Bayridge Store (Assignment Agreement)          Petition Date
   Levitz Store, Brooklyn Park, MN                11/9/2005
   Levitz Store, East Brunswick, NJ               11/9/2005
   Seaman's Store, Jamaica, NY                    Petition Date
   Seaman's Store, Nassau, NY                     11/9/2005
   Messa Call Center, Mesa, AZ                    11/9/2005
   Store under construction in Roseville, CA      Petition Date

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States.  The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189).  David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. (Levitz Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


LIONEL LLC: Wants to Retain Brown Rudnick as Special Counsel
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Lionel LLC and
its debtor-affiliate asks the U.S. Bankruptcy Court for the
Southern District of New York for permission to retain Brown
Rudnick Berlack Israels, LLP, as its special intellectual property
counsel.

The Committee says that the Debtors' cases involve complex and
unresolved intellectual property legal issues including Mike's
Train House litigation.  MTH asserted $16 million claim against
the Debtors alleging damages from intellectual property
infringements.

Brown Rudnick is well qualified to provide the Committee with
consultation and support on intellectual property issues arising
in the Debtors' cases.

Robert J. Stark, a Brown Rudnick member, discloses the firm's
professionals hourly rate:

         Designation               Hourly Rate
         -----------               -----------
         Partners                  $400 - $790
         Associates                $200 - $480
         Paraprofessionals         $125 - $240

The professionals' services to the Committee will be primarily
represented by:

         Professional              Hourly Rate
         ------------              -----------
         Brian Michaelis              $595
         Mark Leonard                 $500
         Peter Sorrel                 $475

Mr. Stark assures the Court that his firm does not represent any
interest adverse to the Debtors' estate.

Headquartered in Chesterfield, Michigan, Lionel LLC --
http://www.lionel.com/-- is a marketer of model train products,
including steam and die engines, rolling stock, operating and non-
operating accessories, track, transformers and electronic control
devices.  The Company filed for chapter 11 protection on Nov. 15,
2004 (Bankr. S.D.N.Y. Case No. 04-17324).  Abbey Walsh Ehrlich,
Esq., at O'Melveny & Myers, LLP, represents the Debtors on their
restructuring efforts.  When the Company filed for protection from
its creditors, it estimated assets between $10 million and $50
million and estimated debts more than $50 million.


LONG BEACH: Moody's Puts Ba2 Rating on Class B-2 Sub. Certificates
------------------------------------------------------------------
Moody's Investors Service assigned a rating of Aaa to the senior
certificates issued by Long Beach Mortgage Loan Trust 2005-WL3,
and rating ranging from Aa1 to Ba2 to the subordinate certificates
in the deal.

The securitization is backed by Long Beach Mortgage Company
originated adjustable-rate (94%) and fixed-rate (6%) mortgages.
The ratings are based primarily:

   * on the credit quality of the loans; and

   * on the protection from:

     -- subordination,
     -- overcollateralization, and
     -- excess spread.

Moody's expects collateral losses to range from 4.65% to 5.15%.

Long Beach Mortgage Company will act as master servicer and
Washington Mutual Bank will act as a sub-servicer.  Moody's has
assigned Washington Mutual its servicer quality rating (SQ2) as a
primary servicer of subprime loans.

The complete rating actions are:

Issuer: Long Beach Mortgage Loan Trust 2005-WL3

    * Class I-A1, Assigned Aaa
    * Class I-A2, Assigned Aaa
    * Class I-A3, Assigned Aaa
    * Class I-A4, Assigned Aaa
    * Class II-A1, Assigned Aaa
    * Class II-A2A, Assigned Aaa
    * Class II-A2B, Assigned Aaa
    * Class II-A3, Assigned Aaa
    * Class M-1, Assigned Aa1
    * Class M-2, Assigned Aa2
    * Class M-3, Assigned Aa3
    * Class M-4, Assigned A1
    * Class M-5, Assigned A2
    * Class M-6, Assigned A3
    * Class M-7, Assigned Baa1
    * Class M-8, Assigned Baa2
    * Class M-9, Assigned Baa3
    * Class B-1, Assigned Ba1
    * Class B-2, Assigned Ba2


MAGELLAN HEALTH: Expects to Earn $55M+ of Net Income in 2006
------------------------------------------------------------
Magellan Health Services, Inc. (Nasdaq:MGLN) provided financial
guidance for fiscal year 2006.

Excluding the impact of its recently disclosed acquisition of
National Imaging Associates, Inc., the Company expects to
generate:

   * revenues in the range of $1.61 billion to $1.65 billion;
   * net income in the range of $55 million to $71 million; and
   * segment profit in the range of $160 million to $180 million.

These results are expected to yield earnings per share in the
range of $1.42 to $1.84 on a fully diluted basis for fiscal 2006.

Cash flow from operations is expected to be in the range of
$131 million to $156 million in 2006, with a net increase in cash,
cash equivalents and unrestricted investments of $96 million to
$131 million by the end of 2006, not including the impact of the
NIA acquisition.

Headquartered in Farmington, Conn., Magellan Health Services
(Nasdaq:MGLN) is the country's leading behavioral health disease
management organization.  Its customers include health plans,
corporations and government agencies.  The Company filed for
chapter 11 protection on March 11, 2003 (Bankr. S.D.N.Y. Case No.
03-40515).  The Court confirmed the Debtors' Third Amended Plan on
Oct. 8, 2003, allowing the Company to emerge from bankruptcy
protection on Jan. 5, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on May 5, 2005,
Standard & Poor's Ratings Services revised its outlook on Magellan
Health Services Inc. to positive from stable.  At the same time,
Standard & Poor's affirmed its 'B+' counterparty credit rating on
Magellan and its 'B+' issue credit ratings assigned to Magellan's
$241 million 9.375% senior notes due November 2008 and its
$185 million credit facility due August 2008.


MAGELLAN HEALTH: Acquiring National Imaging for $122 Million
------------------------------------------------------------
Magellan Health Services, Inc. (Nasdaq:MGLN) signed a definitive
agreement to acquire all of the outstanding stock of National
Imaging Associates, Inc., a privately held radiology benefits
management firm headquartered in Hackensack, New Jersey, from its
owners for approximately $122 million in cash, after giving effect
to estimated cash to be acquired in the transaction.

NIA manages diagnostic imaging services on a non-risk basis for
its customers, which include some of the nation's largest health
plans, to ensure that such services are clinically appropriate and
cost effective.  With more than 17 million lives under contract,
it is the largest radiology benefits management firm in the
country.

Radiology is among the fastest-growing areas of health care
spending, with estimates of projected annual growth exceeding
20 percent.  With ongoing advancements in the field, radiology is
increasingly considered an integral component of the non-invasive
diagnostic tools available to physicians.

Steven J. Shulman, chairman and chief executive officer of
Magellan, said, "NIA is the leader in a quickly growing field that
plays a significant role in making clinically appropriate and
cost-effective use of health care resources.  The company has
demonstrated a commitment to quality, collaboration with health
care providers and operational excellence and has proven its value
to many of the nation's most respected health plans.

"We are very pleased to add NIA and its capabilities to the
Magellan organization," Mr. Shulman continued.  "As we have
consistently stated, one of Magellan's objectives is to drive
growth for shareholders by increasing the portion of the health
care dollar that we manage beyond that represented by behavioral
health care.  With the purchase of NIA, Magellan will be expanding
into a specialty area that addresses a top priority for health
care purchasers -- the cost and quality of radiology services.  At
the same time, we can leverage Magellan's strengths in
underwriting, claims payment and provider network management to
allow NIA to expand its core product offerings as well as build a
risk-based portfolio of customers and significantly increase its
revenue potential."

John Donahue, NIA's president and CEO, said, "NIA's association
with Magellan provides NIA the opportunity to offer a broader
array of services and funding arrangements to our health plan
customers and to expand our market to include other purchasers,
such as large employers and government agencies.  Magellan's
financial strength, operational capabilities and long-term
customer relationships will be assets to NIA as we expand into
risk-based business and continue to enhance our product offerings.
I am very pleased that NIA is joining an organization of
Magellan's caliber and we are energized at the prospect of working
with a seasoned management team with a proven track record in
managing specialty health care services."

                         NIA Acquisition

Under the terms of the agreement, NIA will become a wholly owned
subsidiary of Magellan. The net purchase price is estimated at
$122 million, after giving effect to cash to be acquired in the
transaction.  The transaction, which is subject to customary
closing conditions, including certain regulatory approvals, is
expected to close in the first quarter of 2006.

Assuming the transaction closes at the end of February, for the 10
months of 2006 post-acquisition, the Company expects NIA to
generate approximately $58 million of revenue and $13 million of
segment profit.  The Company expects that the acquisition will be
accretive to earnings by approximately $0.02 per fully diluted
share in 2006, including synergies, which the Company expects to
be minimal.  Cash flow from operations for NIA during the 10
months is expected to be approximately $9 million.

"As we have said over the past several months, our preferred use
of cash is to fund acquisitions that support our growth strategy
and NIA is an excellent investment in that regard," Mr. Shulman
said. "I am very pleased to have reached agreement with NIA and I
am very excited that John and his team will be joining the
Magellan organization.  This transaction is a significant step
forward in leveraging our assets and market position for the
benefit of our stakeholders and we will continue to identify and
evaluate other opportunities to further that objective."

Headquartered in Farmington, Conn., Magellan Health Services
(Nasdaq:MGLN) is the country's leading behavioral health disease
management organization.  Its customers include health plans,
corporations and government agencies.  The Company filed for
chapter 11 protection on March 11, 2003 (Bankr. S.D.N.Y. Case No.
03-40515).  The Court confirmed the Debtors' Third Amended Plan on
Oct. 8, 2003, allowing the Company to emerge from bankruptcy
protection on Jan. 5, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on May 5, 2005,
Standard & Poor's Ratings Services revised its outlook on Magellan
Health Services Inc. to positive from stable.  At the same time,
Standard & Poor's affirmed its 'B+' counterparty credit rating on
Magellan and its 'B+' issue credit ratings assigned to Magellan's
$241 million 9.375% senior notes due November 2008 and its
$185 million credit facility due August 2008.


MCLEODUSA INC: New Letter of Credit Sub Limit is $23.4 Million
--------------------------------------------------------------
As previously reported in the Troubled Company Reporter on Nov. 7,
2005, McLeodUSA Incorporated and some of its subsidiaries entered
into a $50 million Revolving Credit and Guaranty Agreement with
JPMorgan Chase Bank, N.A., as agent.

                   Letter of Credit Amendment

On Dec. 15, 2005, McLeodUSA Incorporated and certain of its
subsidiaries entered into an amendment to the Revolving Credit
and Guaranty Agreement among the Debtors, a consortium of
lenders, and JPMorgan Chase Bank, N.A., as agent.  The Amendment
increases the Letter of Credit Sub Limit under the DIP Agreement
from $15,000,000 to $23,400,000.

Joseph Ceryanec, McLeodUSA's acting chief financial officer, says
that certain of the lenders under the DIP Agreement are also
lenders under the Company's prepetition credit agreements.  In
addition, some of the lenders or their affiliates may hold equity
positions in the Company.

The guarantors under the DIP Agreement are McLeodUSA Holdings,
Inc., McLeodUSA Information Services, Inc., McLeodUSA Network
Services, Inc., McLeodUSA Purchasing, L.L.C., and McLeodUSA
Telecommunications Services, Inc.

Headquartered in Cedar Rapids, Iowa, McLeodUSA Incorporated --
http://www.mcleodusa.com/-- provides integrated communications
services, including local services in 25 Midwest, Southwest,
Northwest and Rocky Mountain states.  The Debtor and its
affiliates filed for chapter 11 protection on Oct. 28, 2005
(Bankr. N.D. Ill. Case Nos. 05-53229 through 05-63234).  Peter
Krebs, Esq., and Timothy R. Pohl, Esq., at Skadden, Arps, Slate,
Meagher and Flom, represent the Debtors in their restructuring
efforts.  As of June 30, 2005, McLeodUSA Incorporated reported
$674,000,000 in total assets and $1,011,000,000 in total debts.

McLeodUSA Inc. previously filed for chapter 11 protection on
January 30, 2002 (Bankr. D. Del. Case No. 02-10288).  The Court
confirmed the Debtor's chapter 11 plan on April 5, 2003, and
that Plan took effect on April 16, 2002.  The Court formally
closed the case on May 20, 2005.  (McLeodUSA Bankruptcy News,
Issue No. 6 Bankruptcy Creditors' Service, Inc., 215/945-7000).


MCLEODUSA INC: Selects Five Members for Reorganized Board
---------------------------------------------------------
The Debtors have selected five initial members who will
constitute Reorganized McLeodUSA, Inc.'s Board of Directors:

    (1) Donald C. Campion
    (2) Eugene Davis
    (3) John D. McEvoy
    (4) Alex Stadler
    (5) D. Craig Young

According to the Debtors, a number of candidates for appointment
as the sixth Initial Director have been identified and
interviewed by members of the informal steering committee of
lenders.  The Debtors anticipate that the sixth Initial Director
will be selected shortly pursuant to a process involving and
agreed to by the Majority Prepetition Lenders.  No Initial
Director is an insider of Reorganized McLeodUSA other than by
virtue of being a director.

                          Donald Campion

Mr. Campion is a senior-level financial executive with multi-
industry experiences that include implementing a major turn-
around, the start-up of a one billion dollar manufacturer, and
developing strategies to expand internationally through
acquisition.

Mr. Campion is a member of the Board of Directors for Haynes
International and also serves as the Chairman of its Audit
Committee and as a member of its Compensation Committee.

Mr. Campion served as the Chief Financial Officer for VeriFone, a
$350,000,000 company, in 2003 and 2004.  He developed financial
and operational strategies, which guided VeriFone towards growth
in sales and profitability, and prepared for a possible IPO.

From 2000 to 2002, Mr. Campion held the position of Executive
Vice President and Chief Financial Officer of Special Devices,
Inc., where he successfully improved Special Devices'
profitability and liquidity.  Before Special Devices, Mr. Campion
held positions as:

    * Executive Vice President and Chief Financial Officer of
      Cambridge Industries, Inc.;

    * Senior Vice President and Chief Financial Officer of
      Oxford Automotive; and

    * senior manager with General Motors and its affiliates.

He holds an MBA and a BS in Applied Mathematics from the
University of Michigan.

                            Eugene Davis

Mr. Davis, 50, is the Chairman and Chief Executive Officer of
PIRINATE Consulting Group, LLC, a privately held consulting firm
specializing in turn-around management, merger and acquisition
consulting, hostile and friendly takeovers, proxy contests and
strategic planning advisory services for domestic and
international public and private business entities.

Since forming PIRINATE in 1997, Mr. Davis has advised, managed,
sold, liquidated and acted as a Chief Executive Officer, Chief
Restructuring Officer, Director, Committee Chairman and Chairman
of the Board of a number of businesses, including companies
operating in the telecommunications, automotive, manufacturing,
high-technology, and medical technologies, among others.

Mr. Davis also served as president, vice-chairman and director of
Emerson Radio Corp, and chief executive and vice-chairman of
Sport Supply Group, Inc.  Mr. Davis began his career as an
attorney and international negotiator with Exxon Corp. and
Standard Oil Company (Indiana) and as a partner in two Texas-
based law firms where he specialized in corporate or securities
law, international transactions and restructuring advisory.

Mr. Davis holds a BA from Columbia College, a Masters of
International Affairs (MIA) in International Law and Organization
from the School of International Affairs of Columbia University
and a JD from the Columbia University School of Law.

                          John McEvoy

Mr. McEvoy is a Partner at Wayzata Investment Partners LLC, a
private investment firm focused on distressed securities and
special situations.  Before joining Wayzata, Mr. McEvoy was
Managing Director and London Group Head for Lehman Brothers
Communications Fund from 2000 to 2003.  Before Lehman Brothers,
Mr. McEvoy was both Principal and Partner at Soros Fund
Management since 1994.

Wayzata is one of the Debtors' Senior Prepetition Lender and a
Junior Prepetition Lender.  Wayzata's holding, as of December 12,
2005, is less than 20% of the total debt under (i) the Senior
Prepetition Credit Agreement and (ii) the Junior Prepetition
Credit Agreement.  Wayzata is also a DIP Lender.

                          Alex Stadler

From 1999 to 2002, Mr. Stadler was the Chief Executive Officer of
riodata group, a data services carrier that he built from scratch
with a group of US VC investors.  riodata, which specializes in
private network and Internet access and connectivity business for
medium-sized companies:

    * achieved solid operational results;

    * deployed a customer relevant data portfolio with excellent
      product USPs and appropriate branding;

    * acquired 2,000 business customers producing $15,000,000 per
      year in revenues; and

    * deployed tailor-made financial tools to control the business
      and margins.

Before the riodata group, Mr. Stadler held positions as the Chief
Operating Officer of Otelo communications, Chief Executive
Officer of RWE Telliance AG, and a variety of Senior Management
roles with GTE Corporation and its subsidiaries.  He holds an MA
in Political Science from the New School for Social Research and
a BS in Economics from the University of Rhodesia (branch of
University of London).

                          D. Craig Young

Mr. Young joined Netifice in June 2004 as Chairman and Chief
Executive Officer.  From 2000 to 2003, he served as vice chairman
and director of AT&T Canada.

Before Netifice, he served as Vice Chairman and President, which
occurred coincident with the $3,500,000,000 merger of MetroNet
Communications and AT&T Canada in June 1999 . Mr. Young was
president and chief executive officer of MetroNet Communication
Corp., Canada's largest facilities-based competitive local
exchange carrier (CLEC), a position he held from March of 1998 to
the merger.

From 1995 to 1998, Mr. Young served as president and chief
operating officer of Brooks Fiber Properties Inc.  While at
Brooks, Mr. Young's team built facilities-based networks in 44
cities and grew revenues from $3,000,000 to over $200,000,000
before Brooks was sold to WorldCom in the first quarter of 1998
for approximately $3,000,000,000.

From 1980 to 1995, Mr. Young held positions as:

    * Vice President Sales Operations, Ameritech Custom Business
      Services;

    * Vice President Sales and Service, Business and Government
      Services, US WEST Communications;

    * Vice President and General Manager, US WEST Information
      Systems; and

    * President of Executone Information Systems.

Mr. Young obtained a Bachelor of Science degree in Marketing at
the California State University at Chico.

Headquartered in Cedar Rapids, Iowa, McLeodUSA Incorporated --
http://www.mcleodusa.com/-- provides integrated communications
services, including local services in 25 Midwest, Southwest,
Northwest and Rocky Mountain states.  The Debtor and its
affiliates filed for chapter 11 protection on Oct. 28, 2005
(Bankr. N.D. Ill. Case Nos. 05-53229 through 05-63234).  Peter
Krebs, Esq., and Timothy R. Pohl, Esq., at Skadden, Arps, Slate,
Meagher and Flom, represent the Debtors in their restructuring
efforts.  As of June 30, 2005, McLeodUSA Incorporated reported
$674,000,000 in total assets and $1,011,000,000 in total debts.

McLeodUSA Inc. previously filed for chapter 11 protection on
January 30, 2002 (Bankr. D. Del. Case No. 02-10288).  The Court
confirmed the Debtor's chapter 11 plan on April 5, 2003, and
that Plan took effect on April 16, 2002.  The Court formally
closed the case on May 20, 2005.  (McLeodUSA Bankruptcy News,
Issue No. 6 Bankruptcy Creditors' Service, Inc., 215/945-7000).


MEDICALCV INC: Posts $712,474 Net Loss in Quarter Ended Oct. 30
---------------------------------------------------------------
MedicalCV Inc. delivered its quarterly report on Form 10-QSB for
the quarter ending October 31, 2005, to the Securities and
Exchange Commission on December 14, 2005.

The Company reported a $712,474 net loss for the quarter ending
October 31, 2005.  Sales and marketing expenses in the quarter
ended October 31, 2005 were $28,617 compared to $0 in the same
period last fiscal year.

At October 31, 2005, the Company's balance sheet showed $9,213,384
in total assets and $24,208,688 in total liabilities.

A full-text copy of MedicalCV's latest quarterly report is
available at no charge at http://researcharchives.com/t/s?3de

                        Going Concern Doubt

The Company has sustained losses and negative cash flows from
operations in recent years and expects these conditions to
continue for the foreseeable future.  At October 31, 2005, the
Company had an accumulated deficit of $38,490,937.  Although the
Company raised funds through the sale of convertible preferred
stock in the last quarter of fiscal year 2005, the level of cash
required for operations during fiscal year 2006 is difficult to
predict, and management anticipates that development of its new
products will require additional capital by the first quarter of
fiscal year 2007.  These matters raise substantial doubt about the
Company's ability to continue as a going concern.

PricewaterhouseCoopers LLP, after auditing the Company's financial
statements for fiscal years 2004 and 2005, expressed doubt about
the Company's ability to continue as a going concern.

Lurie Besikof Lapidus & Company, LLP, will audit MedicalCV's
fiscal 2006 financial statements.  MedicalCV's fiscal year ends on
April 30.

MedicalCV, Inc., is a cardiothoracic surgery device manufacturer.
Previously, its primary focus was on heart valve disease. It
developed and marketed mechanical heart valves known as the
Omnicarbon 3000 and 4000.  In November 2004, after an exhaustive
evaluation of the business, MedicalCV decided to explore options
for exiting the mechanical valve business.  The Company intends to
direct its resources to the development and introduction of
products targeting treatment of atrial fibrillation.


MERIDIAN AUTOMOTIVE: Ct. OKs Modification of Retiree Benefits Plan
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave
Meridian Automotive Systems, Inc., and its debtor-affiliates
authority to modify their Retiree Benefits Plan to streamline the
Plan structure and allow certain carefully tailored costs savings
that balance the needs of the few employees and retirees receiving
special benefits under the Retiree Benefits Plan and the long-term
financial needs of the Debtors, upon which all of the Debtors'
employees and creditors depend.

As previously reported in the Troubled Company Reporter on Dec. 8,
2005, the Debtors specifically seek to:

    * modify the monthly premium rate structure to establish a new
      2006 baseline for cost sharing between the retirees and the
      Company.  Retirees would pay premiums equivalent to
      approximately 30% of the Company's total 2006 cost per
      retiree, an increase from the current average of 20% per
      retiree, but equivalent to the 30% that active employees pay
      for their healthcare coverage;

    * cap the total expenditures so that after 2006, any
      additional cost increases would be passed on to retirees
      through increased monthly premiums.  The current plan
      provides for a 5% cap on annual increases in the Company's
      total expenditures;

    * eliminate and merge into one benefit tier, for employees
      under the age of 55 as of December 1, 1998, the Debtors'
      current five categories of retiree benefits, which are each
      dependent on dates of service and retirement date.  With
      costs shared 70%/30% between the Debtors and retirees for
      2006, most categories of retirees will see their
      contribution percentage reduced by as much as 50%, for those
      eligible employees with 15 to 19 years of service;

    * eliminate, for employees under the age of 55 as of
      December 1, 1998, an option currently available that allows
      retirees with less than 25 years of service to participate
      in the Plan as of age 60 while paying 100% of the cost until
      the Debtors' contributions become available at age 65.
      Employees retiring with at least 25 years of service would
      remain eligible, as under the current Plan, to participate
      in the Plan with full benefits as of age 60;

    * establish coverage for non-Medicare eligible employees under
      a single Blue Cross PPO plan, rather than the current choice
      of three, while adding optional vision and hearing coverage
      at the employee's expense; and

    * eliminate prescription drug coverage for Medical-eligible
      employees in coordination with allowing eligible employees
      to elect Medicare Part D coverage, and again, add optional
      vision and hearing coverage at the employee's expense.

Deductibles, co-pays and co-insurance for Plan participants would
increase somewhat, reflecting increased medical costs, although
the Plan would still provide comprehensive coverage with the same
maximum benefit levels as before, Mr. Kosmowski maintains.

The Debtors have determined that the proposed modifications
strike an important balance between preservation of a narrow
benefit that is available to a small fraction of their workforce
and the Debtors' financial well being.  Mr. Kosmowski reports
that only about 4% of the Debtors' 3,200 active management and
hourly non-union employees in the U.S. are eligible for the
special coverage.

Although the number of affected employees and retirees is small,
the changes would reduce the Debtors' balance sheet liability by
$5,800,000, their annual expense by $791,000, and their annual
retiree health cash benefit payments by an estimated $438,000,
Edward J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor,
LLP, in Wilmington, Delaware explains.

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.  The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176).  James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $530 million in
total assets and approximately $815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


MERIDIAN AUTOMOTIVE: Panel Dismisses Suit Against Three Lenders
---------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
Sept. 9, 2005, the Official Committee of Unsecured Creditors, on
Meridian Automotive Systems, Inc., and its debtor-affiliates'
behalf, wants to avoid certain liens and claims of the first lien
lenders and second lien lenders.

                Panel Dismisses Three Defendants

In separate stipulations, the Official Committee of Unsecured
Creditors agreed to dismiss, without prejudice, Defendants
Oppenheimer & Co., Inc., Deutsche Bank, and Deutsche Bank Trust
Company Americas from the Avoidance Action, subject to these
conditions:

    (a) If any representation by the Defendants is untrue or
        incorrect, they will be deemed to have breached the
        Agreement, and the Agreement will be deemed null and void
        ab initio.

    (b) If the Defendants breach the Agreement, the Committee will
        be entitled to take whatever action is necessary to
        reinstate the Avoidance Action.

    (c) If the Committee reinstates the Avoidance Action with
        respect to the Defendants, then the Defendants will accept
        service of process.

    (d) If the Committee reinstates the Avoidance Action, the
        Defendants will file each of their answers, or otherwise
        respond, to the Committee's Complaint within 20 calendar
        days from the Complaint's date of service.

    (e) If the Avoidance Action is reinstated, the Defendants will
        waive any defense based on any limitations period based in
        law or equity, including, but not limited to, any
        applicable statute of limitation, claim of laches, or the
        Final DIP Order.

    (f) If the Avoidance Action is reinstated, the Defendants will
        waive any claim of prejudice resulting from their absence
        from the Avoidance Action, and all decisions, opinions,
        determinations, and Court orders in the Avoidance Action
        will be deemed to apply to the Committee and the
        Defendants, as if they were parties to the Avoidance
        Action ab initio.

The Committee has determined that the Defendants:

    (i) are not proper parties to the Avoidance Action; and

   (ii) do not hold or assert any security interest, lien or claim
        with respect to any of the Debtors' assets in connection
        with the First Lien Facility and the Second Lien Facility.

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.  The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176).  James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $530 million in
total assets and approximately $815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


MIDLAND COGENERATION: Moody's Lowers $273MM Bonds' Ratings to B3
----------------------------------------------------------------
Moody's Investors Service downgraded the rating of Midland
Cogeneration Venture's secured lease obligation bonds to B3 from
B1.  The downgraded securities are the $73 million (originally
$100 million) secured subordinated lease obligation bonds issued
by Midland Funding Corporation II and the $200 million secured
subordinated lease obligation bonds issued by the Midland County
Economic Development Corporation, for which the underlying cash
flows are derived from Midland Cogeneration Venture Limited
Partnership (MCV or the project).  The rating outlook is stable.
This rating action concludes the review that was initiated on
November 2.

The downgrade of MCV's lease obligation bonds reflects the
potential for substantial losses unless natural gas prices decline
substantially before the project's natural gas hedging
arrangements expire.  These hedging arrangements help to insulate
the project from high natural gas prices but the level of hedging
begins to fall off significantly over the next year.  This
vulnerability to elevated natural gas prices and recent sharp
increases in natural gas market prices led MCV to take a non-cash
impairment charge of approximately $1.2 billion at the end of the
third quarter.

Under its power purchase agreement (PPA) with Consumers Energy
Company (Consumers), energy payments received by the project when
dispatched are based on costs incurred at Consumers' coal-fired
power plants, while the project is a gas-fired generation
facility.  At current high natural gas prices, there is a wide
disparity between the energy payments received under the PPA and
the market price for natural gas.

The downgrade also reflects Moody's expectation that Consumers is
likely to invoke the "regulatory out" provision under the PPA in
2007.  This contract provision permits Consumers to reduce
capacity and energy charges to a level that Consumers is able to
recover from rates approved by the Michigan Public Service
Commission.  As a result of this provision, beginning in September
2007, the approximately $400 million annual capacity payments that
MCV currently receives could be reduced to a level that Consumers
would be able to recover in its regulated utility rates.  Under
its current tariff structure, Consumers is able to recover only
about $350 million of the capacity payments being paid to MCV.

At the end of the third quarter, MCV had approximately $211
million of cash reserves, of which approximately $91 million is
specifically designated to cover the debt portion of MCV's rent
payment obligations.

The stable outlook reflects the possibility that natural gas
prices could decline over the next several years and that the
project's cash balances could support losses for a period of time.
The rating and outlook also consider expectations for substantial
recovery if a default were to occur in the near term.

MCV is a natural gas fired cogeneration facility located in
Midland County, Michigan with a nominal capacity of approximately
1,500 MW.  MCV leases the project assets from certain owner
participants under a 25-year base lease arrangement that expires
in 2015.  Midland Funding Corporation II is a funding vehicle
established to issue notes that funded a portion of the
construction costs of the facility.  The ratings of the secured
subordinated bonds issued by the Midland Funding Corporation II
and Midland County Economic Development Corporation are based upon
the underlying credit quality of the Midland Cogeneration Venture
as lessee.


NATIONAL LAMPOON: Losses & Deficits Trigger Going Concern Doubt
---------------------------------------------------------------
National Lampoon, Inc., fka J2 Communications, Inc., delivered
its quarterly report on Form 10-QSB for the quarter ending
October 31, 2005, to the Securities and Exchange Commission on
Dec. 15, 2005.

For the three months ended October 31, 2005, the company had a net
cash flow used in operating activities of $2,056,691 as compared
to $878,425 of net cash flow used in operating activities during
the three months ended October 31, 2004.  This increase is
primarily attributable to an increase in production costs as well
as a significant pay down of accrued legal, accounting and other
expenses.

Revenues for the third quarter in 2004 were $842,831 compared to
$666,935 for the same period in 2004.  The company decreased its
net loss to $2.2 million per fully diluted shares, for the first
quarter of fiscal 2005, as compared with a $3.2 million net loss
per fully diluted shares for the first quarter 2004.

                        Going Concern Doubt

The management believes that the Company's net losses of
$8,669,170 and $5,127,107 in the prior two years, net loss of
$1,879,038 during the first three months of the 2006 fiscal year,
and accumulated deficit of $33,773,065 at October 31, 2005, raise
concerns about its ability to continue as a going concern.

J2 Communications, Inc., was primarily engaged in the acquisition,
production and distribution of videocassette programs for retail
sale.  In 1991, the Company acquired all of the outstanding shares
of National Lampoon, Inc., and subsequent to the Company's
acquisition of NLI, it de-emphasized its videocassette business
and publishing operations and began to focus primarily on
exploitation of the National Lampoon(TM) trademark.  The Company
reincorporated in Delaware under the name National Lampoon, Inc.,
in November 2002.


NAUTILUS RMBS: Fitch Rates $19 Million Class C Notes at BB
----------------------------------------------------------
Fitch Ratings assigns these ratings to Nautilus RMBS CDO II, Ltd.
and Nautilus RMBS CDO II, LLC:

     -- $225,250,000 class A-1S floating-rate notes due November
        2040 'AAA';

     -- $30,000,000 class A-1J floating-rate notes due November
        2040 'AAA';

     -- $29,000,000 class A-2 floating-rate notes due November
        2040 'AA';

     -- $36,000,000 class A-3 floating-rate deferrable interest
        notes due November 2040 'A';

     -- $23,000,000 class B floating-rate deferrable interest
        notes due November 2040 'BBB';

     -- $19,000,000 class C floating-rate deferrable interest
        notes due November 2040 'BB'.

Nautilus II is a cash flow collateralized debt obligation managed
by RCG Helm, LLC.

The ratings of the class A-1S, class A-1J, and class A-2 notes
address the likelihood that investors will receive full and timely
payments of interest as per the governing documents, as well as
the aggregate outstanding amount of principal by the stated
maturity date.  The ratings of the class A-3, class B, and class C
notes address the likelihood that investors will receive ultimate
interest payments as per the governing documents, as well as the
aggregate outstanding amount of principal by the stated maturity
date.

The ratings are based upon the credit quality of the underlying
assets, 100% of which will be purchased by the transaction's
close, in addition to credit enhancement provided by support from
subordinated notes, excess spread, and protections incorporated in
the structure.

Proceeds from the issuance will be invested in a static portfolio
of residential mortgage-backed securities, consisting primarily of
prime RMBS.  The collateral supporting the structure will have a
Fitch weighted average rating factor of 8.00 ('BBB-/BB+').  The
collateral manager may sell defaulted, credit-risk,
credit-improved, and equity securities at any time.

RCG will select and monitor the assets in the Nautilus II
portfolio.  RCG is a wholly owned subsidiary of Ramius Capital
Group, LLC, a privately owned investment management company and a
Securities and Exchange Commission-registered investment adviser.
Ramius, headquartered in New York, was founded in 1994 and
currently maintains offices in London, Vienna, Munich, Hong Kong,
and Tokyo.  Through several subsidiaries, Ramius manages absolute
return portfolios totaling $7.7 billion.  This includes
$2.5 billion in multistrategy funds, $851 million in
single-strategy funds, and $3.6 billion in multimanager funds.
Notably, assets under management include $229 million in firm
capital.  The company's investment clients include U.S. and
international institutions and private investors.

Nautilus RMBS CDO II, Ltd. is a Cayman Islands exempted company.
Nautilus RMBS CDO II LLC is a Delaware limited liability company.

For more information, see the Fitch presale report dated
Nov. 23, 2005, 'Nautilus RMBS CDO II, Ltd.', available on the
Fitch Ratings Web site at http:www.fitchratings.com/


NEWSCASTLE CDO: Fitch Rates $16 Million Class V Notes at BB
-----------------------------------------------------------
Fitch Ratings assigns these ratings to Newcastle CDO VII, Ltd. and
Newcastle CDO VII Corp.:

     -- $336,000,000 class I-A floating-rate notes due 2050'AAA';

     -- $21,800,000 class I-B floating-rate notes due 2050 'AAA';

     -- $53,000,000 class II floating-rate notes due 2050 'AA';

     -- $26,000,000 class III deferrable floating-rate notes due
        2050 'A';

     -- $20,000,000 class IV-FL deferrable floating-rate notes due
        2050 'BBB';

     -- $6,000,000 class IV-FX deferrable fixed-rate notes due
        2050 'BBB';

     -- $16,000,000 class V Deferrable fixed-rate notes due 2050
        'BB'.

The ratings of the class I-A, class I-B, and class II notes
address the likelihood that investors will receive full and timely
payments of interest as per the governing documents, as well as
the aggregate outstanding amount of principal by the stated
maturity date.  The ratings of the class III, class IV-FL, class
IV-FX, and class V notes address the likelihood that investors
will receive ultimate interest payments as per the governing
documents, as well as the aggregate outstanding amount of
principal by the stated maturity date.

The ratings are based upon the credit quality of the underlying
assets - approximately 96% of which will be purchased by the
transaction's close, the credit enhancement provided to the
capital structure through subordination and excess spread, and the
experience and capabilities of the collateral manager.

Newcastle VII is a revolving arbitrage cash flow collateralized
debt obligation managed by Newcastle Investment Corp., which is
rated 'CAM1' by Fitch.  Proceeds from the issuance will be
invested primarily in a portfolio of commercial mortgage-backed
securities, residential mortgage-backed securities, and real
estate investment trust debt.  The collateral supporting the
capital structure will have a maximum Fitch weighted average
rating factor of 8.40 ('BBB-/BB+').  A portion of uninvested note
issuance proceeds, as of the effective date, will be treated as
interest proceeds and will be passed through the interest
waterfall.

Newcastle VII will have a five-year reinvestment period during
which collateral principal payments will be reinvested according
to the criteria outlined in the governing documents.  The
collateral manager has the ability to sell 10% of the collateral
per year on a discretionary basis during the reinvestment period
and may sell defaulted, credit risk and credit improved securities
at any time.

As long as no coverage tests have failed and more than 50% of the
original collateral amount remains in the portfolio, principal
payments are paid to classes I-A to IV in a pro rata manner.
Otherwise, principal payments are distributed sequentially to each
class of notes, with the exception of the class IV-FL and class
IV-FX notes, which always receive payments pro rata in both the
interest and principal waterfalls.

Newcastle CDO VII, Ltd. is a Cayman Islands exempted company.
Newcastle CDO VII Corp. is a Delaware corporation.

For more information, please see the presale report titled
'Newcastle CDO VII, Ltd.', available on the Fitch Ratings Web site
at http://www.fitchratings.com/ Additional information about the
collateral manager is available at http://www.fitchratings.com/


NORTHWEST AIRLINES: Wants Removal Period Extended to June 12
------------------------------------------------------------
Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, tells the U.S. Bankruptcy Court for the Southern
District of New York that the Northwest Airlines Corp. and its
debtor-affiliates are parties to  numerous actions currently
pending in various states.  The State  Court Actions involve a
wide variety of claims, including, but not limited to, breach of
contract and personal injury claims.

The Debtors ask the Court to extend the time by which they may
file notices of removal with respect to the State Court Actions
pending on the Petition Date, to the later to occur of:

   (a) June 12, 2006;

   (b) 30 days after entry of an order terminating the automatic
       stay with respect to the particular action sought to be
       removed; or

   (c) 30 days after the qualification of a trustee in one of the
       Debtors' Chapter 11 cases but not later than 300 days
       after the Petition Date.

Mr. Petrick explains that, to determine whether to remove any of
the State Court Actions, the Debtors must conduct a comprehensive
analysis of their pending civil actions and evaluate various
factors under Section 1452 of the Judicial Procedures Code, and
determine whether the outcome of a State Court Action may alter
their rights and liabilities and affect the ultimate distribution
to their creditors.

At present, the Debtors have not yet had an opportunity to
evaluate these factors and determine which State Court Actions
they will remove, Mr. Petrick relates.  Thus, the Debtors will
not have sufficient time to properly and accurately analyze
each of the State Court Actions and make the appropriate
determinations concerning removal of specific actions within
the original time period prescribed by Rule 9027 of the Federal
Rules of Bankruptcy Procedure.

Mr. Petrick asserts that the extension of the Removal Period will
afford the Debtors a sufficient opportunity to make informed
decisions concerning removal of each State Court Action and will
assure that they do not forfeit their valuable removal rights.

The rights of the Debtors' adversaries will not be prejudiced by
the extension, Mr. Petrick contends.  In that regard, Section
362(a) of the Bankruptcy Code automatically stays prosecution of
the State Court Actions against Debtors.

Mr. Petrick says that if the Debtors are ultimately successful in
removing any of the State Court Actions to federal court, any
party to the action may seek to have it remanded to the state
court pursuant to Section 1452(b).  Therefore, the extension will
not prejudice the rights of other parties in the State Court
Actions.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NORTHWEST AIRLINES: Refutes Retired Pilots Control Allegation
-------------------------------------------------------------
As previously reported Northwest Airlines Corp. and its debtor-
affiliates asked the U.S. Bankruptcy Court for the Southern
District of New York to authorize the appointment of a single
committee of employees to represent retired employees entitled to
receive retiree benefits pursuant to Sections 1114(c) and 1114(d)
of the Bankruptcy Code.

The Northwest Airlines Retired Pilots Benefit Guardian Association
asked the Court to deny the Debtors' request and appoint the
Association or its nominees -- Neil Henderson and William Cameron
-- to the Retiree Committee.

           Debtors Respond to Retired Pilots Group

The Debtors refute the allegations of the Northwest Airlines
Retired Pilots Benefit Guardian Association that they are pre-
screening the list of retirees for the United States Trustee for
Region 2 to solicit for the Official Committee of Retired
Employees.

Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, clarifies that the Debtors proposed to provide
Deirdre A. Martini, the U.S. Trustee, with the names and
addresses of all Unrepresented Union Retirees so that the she
could solicit them as possible representatives.

As previously reported, the Association has requested that it or
its nominees -- Neil Henderson and William Cameron -- be
appointed to the Retiree Committee.

The Debtors do not take a position as to whether the U.S. Trustee
should or should not recommend Mr. Cameron to be the retired
pilot representative on the Retiree Committee.  However, the
Debtors note that Mr. Henderson does not even receive retiree
medical benefits from Northwest because he is past the age of
Medicare eligibility and does not elect to participate in the
Debtors' plans.

                 U.S. Trustee's Recommendations

The U.S. Trustee asked the seven unions that comprise majority of
the Debtors' employees whether they are willing to act as
authorized representative for their retired union employees under
pursuant to Section 1114(c) of the Bankruptcy Code.

The Air Line Pilots Association, International and the Transport
Workers Union of America declined to represent their retirees.

In consultation with the Official Committee of Unsecured
Creditors and the Debtors, the U.S. Trustee sent solicitation
letters and questionnaires to:

   (a) the Debtors' retired non-union employees covered by
       Section 1114;

   (b) the former employees of Republic Airlines who are
       receiving medical benefits from the Debtors; and

   (c) the retired union employees whose union declined to
       represent its retired members.

The U.S. Trustee said that the Questionnaires were also posted at
the Web sites of the Northwest Airlines Retired Pilots' Benefit
Guardian Association, and the Retired Northwest Airlines Pilots'
Association.

As of November 14, 2005, Ms. Martini received 62 Questionnaires.

                       Court Selects Seven

The U.S. Trustee recommended nine representatives who are willing
to serve as members of the Retiree Committee.

The Court appointed seven of the U.S. Trustee's nominees to the
Retiree Committee.

The Retiree Committee consists of:

   1. O.V. Delle-Femine
      National Director
      Aircraft Mechanics Fraternal Association
      67 Water Street - Suite 208
      La Conia, New Hampshire
      Telephone: (603) 527-9212

   2. Robert B. DePace
      President/Directing General Chair
      International Association of Machinist & Aerospace
        Workers
      2510 Lexington Avenue South
      Mendota Heights, Minnesota
      Telephone: (651) 365-36340

   3. Guy Meek
      President
      Professional Flight Attendants Association
      8101 34TH Avenue South B Second Floor
      Bloomington, Minnesota
      Telephone: (952) 960-5501

   4. William W. Cameron
      [Pilot Retiree]
      1920 Drew Avenue South
      Minneapolis, Minnesota
      Telephone: (952) 449-4146

   5. Arlo T. Bertsch
      Member
      Transport Workers Union of America
      8024 Town Line Avenue S
      Bloomington, Minnesota
      Telephone: (952) 944-3607

   6. Paul C. Peyron
      Republic Airlines Retiree
      456 Sierra Leaf Circle
      Reno, Nevada
      Telephone (775) 851-9390

   7. William D. Slattery
      Non-Union Retiree
      21955 Minnetonka Blvd, #5
      Excelsior, Minnesota
      Telephone: (952) 470-8635

Allan Goldstein, president of the Aircraft Technical Support
Association, and Rory O'Loughlin, chairman of the Northwest
Airlines Meteorology Association, failed to make the cut.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NORTHWEST AIRLINES: Wants Automatic Stay Enforced on Mesaba
-----------------------------------------------------------
As previously reported, Northwest Airlines, Inc., and Mesaba
Aviation, Inc., are parties to an Airline Services Agreement,
dated August 29, 2005, pursuant to which Mesaba provides
Northwest with regional jet transportation services, turboprop
air transportation services, and ground support services.

As part of the ASA, Mesaba subleases 86 aircraft from Northwest
Airlines to provide regional transportation services as directed
by Northwest.

If Mesaba defaults on its obligations under the subleases, the
Debtors are authorized to set off the amounts Mesaba owes against
amounts the Debtors owe Mesaba under the ASA, Gregory M. Petrick,
Esq., at Cadwalader, Wickersham & Taft LLP, in New York, notes.

On October 26, 2005, the Debtors paid Mesaba $10,544,320 for
services rendered from October 1 through October 15, 2005.  At
the same time, to preserve their right to later set off against
amounts due to Mesaba, and to preserve their status as a secured
creditor, the Debtors placed an administrative freeze on the
$6,143,674 due from Mesaba.  On November 1, 2005, Northwest
placed an administrative freeze on an additional $817,295 owed by
Mesaba.

On November 7, 2005, Mesaba commenced an adversary proceeding
asking the U.S. Bankruptcy Court for the District of Minnesota to
restrain and enjoin Northwest Airlines, Inc., from withholding
payments due Mesaba under the ASA.

Mr. Petrick asserts that Mesaba's attempt to obtain possession
of, or to exercise control over, the funds withheld by the
Debtors to preserve their set-off rights violates the automatic
stay under Section 362 of the Bankruptcy Code and the New York
Court's Automatic Stay Order.

Mr. Petrick notes that:

   (a) instead of seeking relief from the stay in the New York
       Court, Mesaba exercised a self-help remedy.  Though Mesaba
       is also a debtor in its own Chapter 11 case, it does not
       relieve it of the obligation to respect the protections of
       the automatic stay to which Northwest is entitled.

   (b) the Minnesota Action seeks to prevent Northwest from
       exercising its set-off rights under the ASA.  While the
       Debtors have not yet exercised their set-off rights under
       the ASA, these are nonetheless valuable assets which
       became property of the estate under Section 541 as of the
       Petition Date;

   (c) the Minnesota Action seeks to deprive Northwest of the
       protections afforded by Section 553, which preserves the
       right of a creditor to off set debts owed by that creditor
       to the debtor, maintaining common law set off rights
       existing outside of bankruptcy; and

   (d) the Debtors have a valid right of set-off under Minnesota
       law pursuant to Section 553, and accordingly holds a valid
       secured claim against Mesaba under Section 506(a).  To the
       extent the Debtors are compelled to surrender the amounts
       to Mesaba, the Debtors' set-off rights would be abrogated
       and their concomitant security interest would be
       compromised.

Accordingly, the Debtors ask the Court to enforce the automatic
stay and impose civil contempt sanctions on Mesaba for its
willful violations of the stay.

                           *     *     *

Judge Gropper says the Bankruptcy Court will not haul another
debtor into the New York Court on short notice, especially as
Mesaba might argue that the Debtors' actions in the New York
Court were just as violative of the automatic stay as Mesaba's
appear to be.

According to Judge Gropper, Northwest's remedy is to argue before
the Minnesota Court that Mesaba must obtain relief from the
automatic stay before the New York Court before Mesaba can sue
Northwest in any other forum on matters that involve prepetition
claims.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NORTHWESTERN CORP: Harbert Hires MacKenzie to Get Votes on Merger
-----------------------------------------------------------------
Senior Managing Director of Harbert Distressed Investment Master
Fund, Ltd., Philip Falcone, sent a letter to the Northwestern
Corp.'s Chairman of the Board Dr. Ernest Linn Draper, Jr., and
CEO, Michael Hanson, over the alleged failure of Northwestern's
board of directors to discharge its fiduciary responsibilities.

Harbert Distressed has also retained MacKenzie Partners, Inc., as
proxy solicitors to encourage other shareholders to Harbert
Distressed to share their views on various issues regarding the
Board's refusal to merge with other companies.

Harbert Distressed holds around 20% of the Company's common stock
and around 33% of the Company's warrants.

Harbert Distressed believes NorthWestern's Board and management
have pursued a policy of rejecting bona fide offers to merge or
sell the company regardless of the impact on shareholder value and
the well being of the company.

                       Past Merger Offers

In spring 2005, the Board rejected a confidential $32.50 cash
offer made by Montana Public Power, a nonprofit corporation
comprised of the cities of Bozeman, Great Falls, Helena and
Missoula.  Mr. Falcone said there was no attempt by the Board to
resolve its concerns with the structure of the offer or its price
or to negotiate an agreement with MPPI, which the Board would find
acceptable.

After MPPI made its offer public, shareholders urged that
negotiations with MPPI be undertaken or interest be solicited from
other buyers or merger partners.  Instead no discussions with MPPI
occurred and the Company allegedly rebuffed multiple invitations
from another suitor, Black Hills Corporation, to discuss a
proposed business combination.

Since the Board refused to negotiate with MPPI, the shareholders
and their financial and legal advisors performed due diligence on
the MPPI proposal, addressing the Board's objections to the deal
and negotiating substantial improvements to the proposal from MPPI
for the benefit of all shareholders.  MPPI presented these
improvements to the Board in a confidential letter clarifying
their offer, and the Board did not respond to MPPI until
shareholders disclosed publicly that the improvements to the offer
had been made, at which point the Board rejected the revised
proposal and again refused to negotiate with MPPI.

A few weeks ago, the Company's CEO, Mike Hanson, told Harbert
Distressed that Black Hills had expressed no specific interest in
acquiring or merging with NorthWestern, contrary to what is now
being reported.

Since July 2005, shareholders have asked NorthWestern to justify
its rejection of MPPI by disclosing the stand-alone value
proposition that was indicated by NorthWestern to be the basis for
the Board's decision.  No stand-alone plan was vetted and approved
by the Board until about November 9.  Following the November 10
investor call explaining the new plan, the share price fell from
$29.50 to $27.85, its lowest level since May and a clear rejection
of the plan by the shareholders, Mr. Falcone said.

On November 1, 2005, the Company received a confidential formal
written proposal for a merger at $33 to $35 per share from Black
Hills.  On November 16, the Company rejected its offer taking the
position that NorthWestern was not interested in entering into
merger negotiations with Black Hills.  NorthWestern management did
not allegedly disclose this offer to the shareholders or other
shareholders when it promoted the stand-alone plan on the November
10 investor call.

On November 17, immediately after rejecting the Black Hills offer
but before the existence of that offer was made public, Mr. Hanson
extended a formal written offer to Harbert Distressed and two
other large shareholders.  In this proposal, NorthWestern would
induce Harbert Distressed to sell its shares in a public offering
by agreeing to pay Harbert Distressed a "top up fee" to guarantee
an above market floor price for its shares.

Harbert Distressed believes that the offer to use the assets of
all shareholders to make a payment to only a few large
shareholders was in large part intended to substantially dilute
Harbert Distressed ability to be an advocate for shareholder
value.  Harbert Distressed declined to proceed with that proposal
purportedly because, among other things, Harbert Distressed
believe that all shareholders can realize a great deal more than
$290 per share if an offer like the one made by Black Hills is
pursued.

NorthWestern has refused to enter into a confidentiality agreement
with Black Hills to allow it to perform due diligence unless Black
Hills agrees not to communicate with NorthWestern shareholders for
one year, and unless Black Hills agrees not to attempt to purchase
the company during that one year period.  Mr. Falcone said that
they can only assume, given NorthWestern's past conduct and its
multiple rejections of Black Hills offers, that this is designed
to allow NorthWestern to reject Black Hills yet again.

                           Poison Pill

Finally, NorthWestern this week adopted a poison pill purportedly
to "protect the interests of stockholders by discouraging
coercive, unfair or abusive takeover tactics that do not offer
fair value to all stockholders".  Harbert Distressed's view is
that this is instead a situation where shareholders' interests
need protection from a Board and management intent on entrenching
itself at all costs.

NorthWestern Corporation, d/b/a NorthWestern Energy --
http://www.northwesternenergy.com/-- is one of the largest
providers of electricity and natural gas in the Upper Midwest and
Northwest, serving more than 617,000 customers in Montana, South
Dakota and Nebraska.

                         *     *     *

As reported in the Troubled Company Reporter on Nov. 30, 2005,
Fitch Ratings has affirmed NorthWestern Corp.'s outstanding senior
secured debt obligations at 'BBB-' and the senior unsecured
revolving credit facility at 'BB+'.  The Rating Outlook has been
revised to Evolving from Positive.  The rating action follows the
disclosure by NOR on Nov. 23, 2005 that it is evaluating a merger
proposal received from Black Hills Corporation, Inc.


OMEGA HEALTHCARE: Offers to Buy Back $100 Million 6.95% Notes
-------------------------------------------------------------
Omega Healthcare Investors, Inc. (NYSE:OHI), commenced an offer to
purchase and consent solicitation with regard to any and all of
its outstanding $100 million aggregate principal amount of 6.95%
notes due 2007.

The offer to purchase will expire at 12:00 midnight, New York City
time, on January 17, 2006, unless extended.  The consent
solicitation will expire at 5:00 p.m., New York City time, on
December 30, 2005, unless extended.

The total consideration to be paid to holders who tender their
notes and deliver their consents prior to 5:00 p.m., New York City
time, on December 30, 2005, will be $1,031.02 for each $1,000
principal amount of notes validly tendered and not validly
revoked, which includes a consent payment of $30.00 per $1,000
principal amount of notes.  Holders who validly tender their notes
after 5:00 p.m., New York City time on December 30, 2005, but
prior to the expiration of the tender offer will receive $1,001.02
for each $1,000 principal amount of notes validly tendered and not
validly revoked on or prior to the expiration date.  Holders who
validly tender notes will also be paid accrued and unpaid interest
up to but not including the date of payment for the notes.

The purchase price for the notes and the consent payment for notes
tendered on or before the expiration of the consent solicitation
are expected to be paid promptly following the acceptance of the
consents.  The purchase price for the notes tendered on or before
the expiration date of the offer to purchase is expected to be
paid promptly following the expiration date of the offer to
purchase.

Holders tendering their notes prior to the expiration of the
consent solicitation will be deemed to have delivered their
consent to certain proposed amendments to the indenture governing
the notes, which will eliminate certain restrictive covenants and
certain provisions relating to events of default and amend certain
other related provisions.

The terms of the offer to purchase and consent solicitation,
including the conditions to the Company's obligations to accept
the notes tendered and consents delivered and pay the purchase
price and consent payments, are set forth in the Company's offer
to purchase and consent solicitation statement, dated December 16,
2005.  The offer is subject to certain conditions, including the
receipt of the requisite number of consents required to amend the
indenture, the execution of the supplemental indenture containing
the proposed amendments and the Company having raised funds from a
private offering of new notes sufficient to pay the total
consideration.  The new notes to be offered have not been and will
not be registered under the Securities Act of 1933 and may not be
offered or sold in the United States absent registration or an
applicable exemption from such registration requirements.  The
Company may amend, extend or terminate the offer to purchase and
consent solicitation at any time in its sole discretion without
making any payments with respect thereto.

Deutsche Bank Securities Inc. is the dealer manager for the offer
to purchase and the solicitation agent for the consent
solicitation.  Questions or requests for assistance may be
directed to:

         Deutsche Bank Securities Inc.
         Telephone: (212) 250-4270 (collect)
                    (800) 553-2826 (toll-free)

Requests for documentation may be directed to the information
agent:

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

Omega HealthCare Investors, Inc. --
http://www.omegahealthcare.com/-- is a real estate investment
trust investing in and providing financing to the long-term care
industry. At September 30, 2005, the Company owned or held
mortgages on 216 skilled nursing and assisted living facilities
with approximately 22,407 beds located in 28 states and operated
by 38 third-party healthcare operating companies.

                         *     *     *

Omega Healthcare's 6.95% notes due 2007 and 7% notes due 2014
carry Moody's Investors Service's B1 rating, Standard & Poor's BB-
rating and Fitch's BB- rating.


OMEGA HEALTHCARE: Selling $175M Notes to Buy Back Notes & Pay Loan
------------------------------------------------------------------
Omega Healthcare Investors, Inc. (NYSE:OHI), disclosed its
intention to offer approximately $175 million in principal amount
of unsecured notes due 2016 in a private placement contemplating
resales in accordance with Rule 144A under the Securities Act of
1933, as amended, and in offshore transactions pursuant to
Regulation S under the Securities Act.

Omega anticipates that the notes will be unsecured senior
obligations of Omega and will be guaranteed by Omega's
subsidiaries.  Omega will use the net proceeds of the offering to
fund its cash tender offer and consent solicitation for its
outstanding $100 million aggregate principal amount of 6.95% notes
due 2007, to repay outstanding indebtedness under Omega's
$200 million senior revolving credit facility, for general
corporate purposes and to pay related fees and expenses.

The notes issued in this offering have not been registered under
the Securities Act of 1933, as amended, or any applicable state
laws, and may not be offered or sold in the United States absent
registration or an applicable exemption from registration
requirements.

Headquartered in Timonium, maryland, Omega HealthCare Investors,
Inc. -- http://www.omegahealthcare.com/-- is a real estate
investment trust investing in and providing financing to the long-
term care industry.  At September 30, 2005, the Company owned or
held mortgages on 216 skilled nursing and assisted living
facilities with approximately 22,407 beds located in 28 states and
operated by 38 third-party healthcare operating companies.

                         *     *     *

Omega Healthcare's 6.95% notes due 2007 and 7% notes due 2014
carry Moody's Investors Service's B1 rating, Standard & Poor's BB-
rating and Fitch's BB- rating.


ON SEMICONDUCTOR: Offering $95 Mil. of Convertible Sr. Sub. Notes
-----------------------------------------------------------------
ON Semiconductor Corporation (NASDAQ: ONNN) proposes to offer
approximately $95 million of convertible senior subordinated notes
in an institutional private placement.  ON Semiconductor expects
to use the net proceeds from the offering to repay its outstanding
10% Junior Subordinated Note due 2011.

ON Semiconductor expects to grant the initial purchasers of the
offering an option to purchase up to an additional $14 million
aggregate principal amount of the notes.  Any net proceeds not
used to repay the 10 Percent Junior Subordinated Note due 2011
will be used for general corporate purposes.

ON Semiconductor Corp. -- http://www.onsemi.com/-- supplies power
solutions to engineers, purchasing professionals, distributors and
contract manufacturers in the computer, cell phone, portable
devices, automotive and industrial markets.

ON Semiconductor Corp.'s 12% Senior Secured Notes due 2010 carry
Standard & Poor's B+ rating.


ON SEMICONDUCTOR: Expects 4% Growth in Revenues for Fourth Quarter
------------------------------------------------------------------
ON Semiconductor Corporation (NASDAQ: ONNN) expects fourth quarter
2005 revenues to grow sequentially by 4 to 6 percent over third
quarter 2005 revenues.  Additionally, the Company expects that
gross margins will be up approximately 100 basis points
sequentially in the fourth quarter of 2005 as previously
announced.

"We are encouraged by the strong seasonal demand we are
experiencing in the fourth quarter of 2005," said Keith Jackson,
ON Semiconductor president and CEO.  "Our consumer driven
end-markets -- computing, consumer electronics and wireless which
represented over 60 percent of our third quarter 2005 revenues
-- continue to grow robustly in the fourth quarter of 2005.  We
will provide further details on fourth quarter 2005 results and
first quarter 2006 guidance on our conference call scheduled for
Feb. 2, 2006."

ON Semiconductor Corp. -- http://www.onsemi.com/-- supplies power
solutions to engineers, purchasing professionals, distributors and
contract manufacturers in the computer, cell phone, portable
devices, automotive and industrial markets.

ON Semiconductor Corp.'s 12% Senior Secured Notes due 2010 carry
Standard & Poor's B+ rating.


PHOTOCIRCUITS CORP: Deloitte Financial Approved as Fin'l Advisors
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized the Official Committee of Unsecured Creditors of
Photocircuits Corporation to retain Deloitte Financial
Advisory Services LLP as its financial advisors, nunc pro tunc to
Oct. 25, 2005.

Deloitte Financial will:

   a) assist the Committee in connection with its assessment of
      the Debtor's cash, liquidity and financing requirements;

   b) assist the Committee in connection with its monitoring of
      the Debtor's financial and operating performance, including
      its current operations, monthly operating reports, and
      other financial and operating analyses or periodic reports
      as provided by management or the Debtor's financial
      advisors;

   c) assist the Committee in evaluating any potential key
      employee retention plans, compensation and benefit plans or
      other incentive plans;

   d) assist the Committee in evaluating the Debtor's business,
      operational, and financial plans, both short-term and long-
      term, including actual results versus forecast, capital
      expenditure and cost reduction opportunities;

   e) assist the Committee in connection with its evaluation of
      the Debtor's statement of financial affairs and supporting
      schedules, executory contracts and claims;

   f) assist the Committee in evaluating the Debtor's operating
      structure, business configuration and strategic
      alternatives;

   g) assist the Committee in evaluating restructuring
      alternatives;

   h) assist the Committee in plan negotiations including
      analysis, preparation or evaluation of any plan of
      reorganization proposed by the Debtor or any party-in-
      interest;

   i) assist the Committee in its analysis of issues related to
      claims filed against the Debtor including reclamation
      issues, administrative, priority or unsecured claims, case
      litigation, contract rejection damages;

   j) assist the Committee in evaluating auction procedures or
      sale transactions that may take place;

   k) attend and participate in hearings before the Court;

   l) assist the Committee in its analysis of the Debtor's books
      and records in connection with potential recovery of funds
      from voidable transactions, preference payments, fraudulent
      transfers and unenforceable claims; and

   m) provide other services that may be required by the
      Committee.

Daniel S. Polsky disclosed that Deloitee Financial will be paid at
an hourly rate of $300 for all professional staff involved.

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

Headquartered in Glen Cove, New York, Photocircuits Corporation
-- http://www.photocircuits.com/-- was the first independent
printed circuit board fabricator in the world.  Its worldwide
reach comprises facilities in Peachtree City, Georgia; Monterrey,
Mexico; Heredia, Costa Rica; and Batangas, Philippines.  The
Company filed for chapter 11 protection on Oct. 14, 2005 (Bankr.
E.D.N.Y. Case No. 05-89022).  Gerard R Luckman, Esq., at Silverman
Perlstein & Acampora LLP, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it estimated more than $100 million in assets and
debts.


RAVEN MOON: Registers 400 Million Common Shares for Sale
--------------------------------------------------------
Raven Moon Entertainment, Inc., filed a Registration Statement
with the Securities and Exchange Commission for the sale of
400 million of its common stock to fetch $320,000.

The Company's authorized stock consists 20 billion authorized
shares, with a par value of $.0001 per share, 1,042,931,587 shares
of which were outstanding as of December 13, 2005, and 800,000,000
authorized shares of Preferred Stock, with a par value $.0001 par
value, approximately 600,000 shares of which were outstanding as
of December 13, 2005.

The Company has appointed Florida Atlantic Stock Transfer, Inc.,
as transfer agent and registrar for the common shares.

J. Bennett Grocock, counsel to the Company, owns approximately
30 million of the Company's common shares.

The Company's common shares trade in the Over-the-Counter Bulletin
Board under the symbol "RVMN.OB".  The Company's common shares
traded between $0.00062 and $0.002 this month.

A full-text copy of the Registration Statement is available for
free at http://ResearchArchives.com/t/s?3d9

Raven Moon Entertainment, Inc. -- http://www.ravenmoon.net/--  
develops and produces children's television programs and videos,
CD music, and Internet websites focused on the entertainment
industry.  Raven Moon talks about music publishing and talent
management on its Web site.  Raven Moon indicates in its latest
quarterly report that it wants to enter the plush toy market too.

At Sept. 30, 2005, the company's balance sheet showed a
stockholders' deficit of $1,871,796.


RUFUS INC: Wants Exclusive Period Stretched to February 10
----------------------------------------------------------
Rufus, Inc., asks the U.S. Bankruptcy Court for the District of
Delaware to further extend until February 10, 2006, the period
where it can file a chapter 11 plan.  The Debtor also wants until
April 7, 2006, to solicit acceptances of that plan.

Although the Debtor has filed its Plan and Disclosure Statement,
as reported yesterday, and a hearing is set for December 27, 2005,
out of an abundance of caution, the Debtor is seeking extension in
order to provide more time to solicit acceptance of the plan or an
amended plan, if necessary.

Furthermore, the extension will afford the parties the opportunity
to pursue the beneficial objectives of a confirmable plan.

Headquartered in Meriden, Connecticut, Rufus, Inc., sells dogs,
dog food, supplies and accessories.  The Debtor also operates a
chain of six retail stores in the Northeastern United States.  The
Company filed for chapter 11 protection on Aug. 10, 2005 (Bankr.
D. Del. Case No. 05-12218).  Edward J. Kosmowski, Esq., and Ian S.
Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP,
represent the Debtor in its bankruptcy proceeding.  When the
Debtor filed for protection from its creditors, it listed
$1.8 million in total assets and $12.7 million in total debts.


RURAL/METRO: Swapping $125M of Sr. Sub. Notes for Registered Bonds
------------------------------------------------------------------
Rural/Metro Corporation's subsiadiries -- Rural/Metro Operating
Company, LLC, Rural/Metro (Delaware) Inc. and Rural/Metro LLC --
are offering to exchange all outstanding $125 million principal
amount of 9.875% Senior Subordinated Notes due 2015 for $125
million principal amount of 9.875% Senior Subordinated Notes due
2015 registered under the Securities Act of 1933.

The form and terms of the registered notes are identical in all
material respects to the form and terms of the old notes, except
for transfer restrictions, registration rights and additional
interest payment provisions relating only to the old notes.  The
companies do not intend to apply to have any notes listed on any
securities exchange or automated quotation system and there may be
no active trading market for them.

              Material Terms of the Exchange Offer

The exchange offer expires at 5:00 p.m., New York City time, on
Wednesday, January 18, 2006, unless extended.

All old notes that are validly tendered and not validly withdrawn
will be exchanged.  Tenders of old notes in the exchange offer may
be withdrawn at any time prior to the time of expiration.

After completion of the exchange offer, noteholders who have not
tendered their old notes will not have any further registration
rights.  Holders of old notes may continue to be subject to
certain restrictions on transfer.  Therefore, the liquidity of the
market for the old notes could be adversely affected upon
completion of the exchange offer if noteholders do not participate
in the exchange offer.

A full-text copy of the Exchange Offer Prospectus is available for
free at http://ResearchArchives.com/t/s?3df

Rural/Metro Corporation -- http://www.ruralmetro.com/-- provides
emergency and non-emergency medical transportation, fire
protection, and other safety services in 23 states and
approximately 365 communities throughout the United States.

At Sept. 30, 2005, Rural/Metro's balance sheet showed a
$94,487,000 stockholders' deficit, compared to a $98,643,000
deficit at June 30, 2005.


RURAL/METRO: Noteholders Have Until Jan. 18 to Swap Discount Notes
------------------------------------------------------------------
Rural/Metro Corporation sets 5:00 p.m., New York City time, on
Wednesday, January 18, 2006, as the expiration date of its offer
to exchange all outstanding $93.5 million principal amount at
maturity of 12.75% Senior Discount Notes due 2016 for $93.5
million principal amount at maturity of 12.75% Senior Discount
Notes due 2016 registered under the Securities Act of 1933

All old notes validly tendered and not validly withdrawn will be
exchanged.  Tenders of old notes in the exchange offer may be
withdrawn at any time prior to the time of expiration.

As reported in the Troubled Company Reporter on Dec. 14, 2005, the
form and terms of the registered notes are identical in all
material respects to the form and terms of the old notes, except
for transfer restrictions, registration rights and additional
interest payment provisions relating only to the old notes.  The
Company does not intend to apply to have any notes listed on any
securities exchange or automated quotation system and there may be
no active trading market for them.

The old notes may continue to be subject to certain restrictions
on transfer.  Therefore, the liquidity of the market for the old
notes could be adversely affected upon completion of the exchange
offer if you do not participate in the exchange offer.

A full-text copy of the Prospectus is available for free at
http://ResearchArchives.com/t/s?3e0

Rural/Metro Corporation -- http://www.ruralmetro.com/-- provides
emergency and non-emergency medical transportation, fire
protection, and other safety services in 23 states and
approximately 365 communities throughout the United States.

At Sept. 30, 2005, Rural/Metro's balance sheet showed a
$94,487,000 stockholders' deficit, compared to a $98,643,000
deficit at June 30, 2005.


SEPRACOR INC: Registers 4 Mil. Shares for Stock Plan Distribution
-----------------------------------------------------------------
Sepracor Inc. filed a Registration Statement with the Securities
and Exchange Commission for the issuance of 4 million shares of
common stock under its 2000 Stock Incentive Plan, as amended.

The Company prices the common shares at $53.54 per share for a
total amount of $214.16 million in stock to be distributed under
the Plan.

The Company's shares are traded at the Nasdaq National Market
under the symbol "SEPR".  The Company's shares were traded around
$55.25 early this month.  They now trade around $52 per share.

Sepracor Inc. is a research-based pharmaceutical company dedicated
to treating and preventing human disease through the discovery,
development and commercialization of innovative pharmaceutical
products that are directed toward serving unmet medical needs.
Sepracor's drug development program has yielded an extensive
portfolio of pharmaceutical compound candidates with a focus on
respiratory and central nervous system disorders.  Sepracor's
corporate headquarters are located in Marlborough, Massachusetts.

As of September 30, 2005, Sepracor's equity deficit narrowed to
$212,788,000 from a $331,115,000 deficit at Dec.31, 2004.


SERACARE LIFE: Audit Committee Conducts Internal Review
-------------------------------------------------------
SeraCare Life Sciences, Inc. (Nasdaq: SRLS) reported that the
chairman of the company's audit committee has received a letter
from Mayer Hoffman McCann P.C., the company's independent
auditors, in which MHM raised concerns with respect to the
company's:

    * financial statements,

    * accounting documentation and

    * the ability of MHM to rely on representations of the
      Company's management.

Specifically, the letter sets forth concerns by MHM with respect
to:

    * certain of the Company's revenue recognition accounting
      policies and practices,

    * the accounting for and valuation of the Company's inventory,

    * MHM's perception that certain board members were exerting
      undue influence on the Company's financial reporting process
      and on the audit process, and

    * the timeliness, quality and completeness of the Company's
      implementation and testing of its internal control over
      financial reporting.

                  Form 10-K Filing Delay

The audit committee has reviewed this letter and has determined to
conduct an internal review of the concerns raised by MHM in the
letter.  The audit committee has retained independent legal
counsel and accountants to assist it in this review.  As the
review is in its preliminary stages, the company is unable at this
point to estimate when the audit of its financial statements for
fiscal 2005 will be completed or when the corresponding Form 10-K
will be filed.  The Company expects to release its earnings for
its fiscal fourth quarter and year ended Sept. 30, 2005 after the
audit committee completes its internal review and the Company's
auditors complete their audit of the Company's financial
statements.

                 Credit Facility Waiver

In contemplation of the delay in filing its Form 10-K, the
Company:

    * has initiated discussions with the lenders under its Credit
      Facility to obtain a waiver of the requirement that it
      provide the lenders with audited financial statements within
      90 days after the completion of its fiscal year,

    * has sent a notice to its transfer agent and the persons
      listed as selling security holders under its Registration
      Statement on Form S-3, alerting such persons that the
      company will not be able to timely file its Form 10-K and
      that accordingly, sales may not be made under the Form S-3
      until the Form 10-K has been filed, and

    * expects to postpone its annual shareholders meeting,
      previously scheduled for Feb. 9, 2006.

                 Likely Nasdaq Delisting

In addition, the Company understands that because the Company no
longer expects to file its Form 10-K by Dec. 29, 2005, Nasdaq may,
in accordance with its rules, initiate delisting proceedings.  In
such event, an "E" will be appended to the Company's trading
symbol during the pendency of delisting proceedings.  The Company
intends to work with Nasdaq to seek to maintain its status as a
Nasdaq National Market company.

SeraCare Life Sciences Inc. -- http://www.seracare.com/-- is a
manufacturer and provider of biological products and services to
diagnostic, therapeutic, drug discovery, and research
organizations.  The company's offerings include plasma-based
therapeutic products, diagnostic products and reagents, cell
culture products, specialty plasmas, in vitro stabilizers, and the
SeraCare BioBank(TM), a proprietary database of medical
information and associated blood, plasma, DNA and RNA samples.
Headquartered in Oceanside, CA, SeraCare conducts business
throughout the world, and is traded on the NASDAQ national stock
market under the symbol SRLS.


SOUTHERN UNION: Moody's Reviews Preferred Securities' Ba2 Rating
----------------------------------------------------------------
Moody's Investors Service placed under review for possible
downgrade the Baa3/negative outlook senior unsecured debt ratings
of Southern Union Company (SUG) and its transportation and storage
subsidiary, Panhandle Eastern Pipe Line Company, LLC, following
SUG's announcement to acquire Sid Richardson Energy Services Co.,
a gas gathering and processing company based in Fort Worth, Texas,
for $1.6 billion.

While the current ratings factor in the acquisitive nature of SUG,
Moody's notes that this new foray into an unregulated business for
SUG would entail additional risk elements which the company would
have to adequately address in order to mitigate the cyclicality,
volume, and commodity-price risks related to this new line of
business.  Moreover, the company would need to capitalize this
line of business with a far more conservative equity to debt
component than that reflected in its current capitalization to
compensate for the added risks inherent in a gas gathering and
processing business.

In addition, Moody's will review the impact of the Sid Richardson
acquisition, operations, internal controls and corporate oversight
for this new business segment on SUG, as well as the methods of
ring-fencing the Sid Richardson financing and operating functions
from those of the regulated businesses of SUG.  This review
process is anticipated to take several months on account of
necessary regulatory approvals and execution of a permanent
financing plan.

SUG will need to develop a viable financing plan and realistic
time schedule for consummating this acquisition, assuming it
obtains the necessary regulatory and legal approvals on a timely
basis.  Also, as in any acquisition, there are issues of
operational and systems integration that would need to be planned
and monitored as well as issues of financial execution that need
to be adequately addressed.

Finally, as SUG has recently undergone significant management
changes at the executive level, the company's overall corporate
strategy and ability to improve corporate governance are still
evolving and need to be more clearly defined under the review
process.  Among the budgetary issues that need to be reviewed are
the company's ability to fund future cash dividends and capital
expenditure programs in light of ongoing acquisitions.

Ratings of SUG under Review are:

  Southern Union Company:

    -- Baa3 senior unsecured debt
    -- Baa3 senior implied ratings

  Southern Union Company:

    -- Ba2 non-cum. perpetual preferred securities

  Panhandle Eastern Pipe Line Company, LLC:

    -- Baa3 senior unsecured debt.

Southern Union Company is engaged primarily in the business of:

   * transportation,
   * storage, and
   * distribution of natural gas.

It maintains executive offices in Houston, Texas and Scranton,
Pennsylvania.


SOUTHERN UNION: Unit Inks Pact to Buy Sid Richardson for $1.6 Bil.
------------------------------------------------------------------
Southern Union Company (NYSE: SUG) reported that a wholly owned
subsidiary has signed a definitive agreement to acquire Sid
Richardson Energy Services Company, a privately held natural gas
gathering and processing company, and the related Richardson
Energy Marketing for $1.6 billion in cash.

Headquartered in Fort Worth, Texas, Sid Richardson Energy Services
has approximately 4,600 miles of natural gas and natural gas
liquids pipelines in the Permian Basin.  The company's fully
integrated North and South systems are connected by a high-
pressure pipeline.  Additionally, the company has four active
cryogenic plants and six active natural gas treating plants.

"We are thrilled to add the expansive pipeline network of Sid
Richardson Energy Services to the Southern Union family of
companies," said George L. Lindemann, Southern Union's Chairman
and CEO.  Over the past several years, we have transformed
Southern Union into one of the leading interstate energy pipeline
operators in the nation.  With the addition of the Sid Richardson
business, we will now have more than 22,000 miles of gathering and
transportation pipelines stretching from the Gulf of Mexico to the
Southwest, Midwest and Canada.  The Sid Richardson gathering and
processing business reflects our continued commitment to the
natural gas business and is a logical complement to our existing
transportation and LNG businesses.  We are confident that these
robust assets will drive additional earnings and cash flow growth
in the years to come.  Further, in today's strong natural gas
market, we've taken steps through our hedging program to lock in
substantial future revenues.

The transaction, which has been approved by the Boards of both
companies, is expected to be accretive to Southern Union's 2006
earnings.  The transaction is subject to antitrust clearance and
other customary closing conditions, and is expected to close in
the first quarter of 2006.

Commenting on the planned financing of the acquisition, Southern
Union's Chief Financial Officer, Julie Edwards, said, "We plan to
fund this purchase with a combination of equity and debt as
appropriate to preserve the health of our balance sheet.  We may
be required to utilize bridge financing while we evaluate
alternative sources of equity and are confident that we will have
the appropriate capital structure in place within several months."

The acquisition represents another step in Southern Union's
ongoing transformation into a higher return business with
significant growth opportunities.  With the closing of this
acquisition, the Company will have made acquisitions totaling
approximately $6 billion in the natural gas gathering, processing
and transportation businesses.  In June 2003, Southern Union
acquired the CMS Panhandle Companies, which added more than 10,000
miles of mainline natural gas pipelines across North America. In
November 2004, the Company acquired CrossCountry Energy, LLC from
Enron Corp. through a joint venture, adding about 7,500 miles of
pipeline. Southern Union's interstate pipelines operate in 17
states.

Fleischman & Walsh, LLP and Kasowitz, Benson, Torres & Friedman
LLP acted as Southern Union's legal counsel.  Merrill Lynch & Co.
has assisted Southern Union in its evaluation of the Sid
Richardson business.

Southern Union Company -- http://www.southernunionco.com/-- is
engaged primarily in the transportation, storage and distribution
of natural gas.  Through Panhandle Energy, the Company owns and
operates 100% of Panhandle Eastern Pipe Line Company, Trunkline
Gas Company, Sea Robin Pipeline Company, Southwest Gas Storage
Company and Trunkline LNG Company - one of North America's largest
liquefied natural gas import terminals.  Through CCE Holdings,
LLC, Southern Union also owns a 50 percent interest in and
operates the CrossCountry Energy pipelines, which include 100
percent of Transwestern Pipeline Company and 50 percent of Citrus
Corp.  Citrus Corp. owns 100 percent of the Florida Gas
Transmission pipeline system.  Southern Union's pipeline interests
operate approximately 18,000 miles of interstate pipelines that
transport natural gas from the San Juan, Anadarko and Permian
Basins, the Rockies, the Gulf of Mexico, Mobile Bay, South Texas
and the Panhandle regions of Texas and Oklahoma to major markets
in the Southeast, West, Midwest and Great Lakes region.
Through its local distribution companies, Missouri Gas Energy, PG
Energy and New England Gas Company, Southern Union also serves
approximately one million natural gas end-user customers in
Missouri, Pennsylvania, Rhode Island and Massachusetts.

                         *     *     *

Moody's rates Southern Union's preferred stock at Ba2.


SUN HEALTHCARE: Looks to Raise $36 Million in Stock Offering
------------------------------------------------------------
Sun Healthcare Group, Inc. (NASDAQ: SUNH) priced its offering of
6,000,000 shares of its common stock at a public offering price of
$6.00 per share, with gross proceeds of $36.0 million, before
underwriting discounts and commissions and expenses payable by the
company.  In connection with the offering, Sun has granted the
underwriters a 30-day option to purchase up to 900,000 additional
shares of its common stock to cover over-allotments, if any.

Sun intends to use the net proceeds from this offering to repay
amounts outstanding under its revolving credit facility and for
general corporate purposes.

UBS Investment Bank acted as the sole book-running manager of this
offering.  CIBC World Markets and Jefferies & Company acted as co-
managers.

Sun Healthcare Group, Inc., with executive offices located in
Irvine, California, owns SunBridge Healthcare Corporation and
other affiliated companies that operate long-term and postacute
care facilities in many states.  In addition, the Sun Healthcare
Group family of companies provides therapy through SunDance
Rehabilitation Corporation, medical staffing through CareerStaff
Unlimited, Inc., and home care through SunPlus Home Health
Services, Inc.

The Company filed for chapter 11 protection on Oct. 14, 1999
(Bankr. D. Del. Case No. 99-03657).  Mark D. Collins, Esq., and
Christina M. Houston, Esq., at Richards, Layton & Finger, P.A.,
represent the Debtor.  The Court confirmed the Debtor's chapter 11
Plan on Feb. 6, 2002, and the Plan took effect on Feb. 28, 2002.

At Sept. 30, 2005, Sun Healthcare's balance sheet showed a
$109,509,000 stockholders' deficit, compared to a $123,380,000
deficit at Dec. 31, 2004.


SUN HEALTHCARE: Acquires Peak Medical in All-Stock Deal
-------------------------------------------------------
Sun Healthcare Group, Inc. (NasdaqNM:SUNH), completed its
acquisition of Peak Medical Corporation on Dec. 9, 2005.  Peak is
a healthcare company based in Albuquerque, New Mexico that
operates or manages an aggregate of 62 inpatient facilities that
include skilled nursing facilities, independent and assisted
living residences and a small hospice operation.  Peak's
facilities are located in New Mexico, Oklahoma, Colorado, Montana,
Idaho, Utah and Wyoming, and include 5,264 licensed beds, 242
unlicensed units and 902 managed beds.

In connection with the acquisition, Sun Healthcare issued
8,871,890 shares of its common stock to the stockholders of Peak
in consideration of the acquisition of 100% of the ownership of
Peak.

"Completing this acquisition is a major step forward for the
growth of Sun's long-term care business," said Richard K. Matros,
Sun's chairman of the board and chief executive officer.  Mr.
Matros continued, "Peak not only brings us a sizeable acquisition
of inpatient business, but a dedicated and hardworking team of
healthcare professionals that will build on the quality and
business agenda we have established at Sun."

                        Credit Amendment

On December 9, 2005, Sun Healthcare and its operating subsidiaries
entered into a Joinder and First Amendment to Amended and Restated
Loan and Security Agreement with CapitalSource Finance LLC, to
include Peak and most of its operating subsidiaries under the Sun
Healthcare's revolving credit facility.  The Amendment also
increases fees if Sun terminates the credit facility prior to its
scheduled termination date, incorporates limitations on the
borrowing base derived from certain of Peak's accounts receivable
in which a mortgage lender has a security interest and requires
payment of interest on a minimum of $10 million whether or not
such amount is borrowed under the credit facility.

Sun Healthcare Group, Inc., with executive offices located in
Irvine, California, owns SunBridge Healthcare Corporation and
other affiliated companies that operate long-term and postacute
care facilities in many states.  In addition, the Sun Healthcare
Group family of companies provides therapy through SunDance
Rehabilitation Corporation, medical staffing through CareerStaff
Unlimited, Inc., and home care through SunPlus Home Health
Services, Inc.

The Company filed for chapter 11 protection on Oct. 14, 1999
(Bankr. D. Del. Case No. 99-03657).  Mark D. Collins, Esq., and
Christina M. Houston, Esq., at Richards, Layton & Finger, P.A.,
represent the Debtor.  The Court confirmed the Debtor's chapter 11
Plan on Feb. 6, 2002, and the Plan took effect on Feb. 28, 2002.

At Sept. 30, 2005, Sun Healthcare's balance sheet showed a
$109,509,000 stockholders' deficit, compared to a $123,380,000
deficit at Dec. 31, 2004.


SUPERIOR PLUS: Acquisition Impact Earns S&P's Low-B Debt Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' long-term
corporate credit and 'BBB-' senior secured debt ratings on
Superior Plus Inc.

At the same time, the ratings were removed from CreditWatch, where
they were placed with negative implications Sept. 30, 2005.  The
outlook is stable.

The ratings affirmation follows a review of the company's
consolidated business risk profile after its acquisition of
U.S.-based flat-rolled aluminum manufacturer, JW Aluminum.

"JWA's business risk is higher than that of Superior's existing
asset base," said Standard & Poor's credit analyst Bhavini Patel.
"Nevertheless, the strength of the consolidated business profile
remains the propane distribution and specialty chemicals
businesses.  In addition, further acquisitions like JWA and
Winroc, which are both small and much weaker, could abate the
current business profile," Ms. Patel added.

The ratings on Calgary, Alberta-based Superior reflect the
company's aggressive financial profile with limited financial
flexibility and modest, but stable margins.  Furthermore, the
company's acquisition-related growth strategy into new business
lines introduces a source of uncertainty to the credit profile.
These weaknesses are alleviated by the strong market positions of
the propane distribution and specialty chemicals businesses and
the diversity of company's assets, on a consolidated basis, across
end markets, products, and customers.

Superior is a wholly owned subsidiary of Superior Plus Income
Fund, a limited-purpose, unincorporated trust.  All of the fund's
revenues and cash flows are derived through Superior, the
operating company, and these cash flows are used to service the
fund's debt and trust unit distributions.  Standard & Poor's takes
a consolidated approach to the ratings and focuses on the
consolidated financial results of the fund.  Consistent with
Standard & Poor's rating methodology, Superior's secured notes are
rated one notch higher than the long-term corporate credit rating
to reflect the enhanced recovery prospects.

The company owns and operates five distinct business divisions:
Superior Propane, the largest propane distributor in Canada; ERCO
Worldwide, a specialty chemicals producer; JWA, a specialty
aluminum manufacturer; Winroc, a North American building products
distributor; and Superior Energy Management, a natural gas
marketer.

Superior's fair business profile reflects:

     * the volatile nature of the unregulated propane distribution
       industry;

     * the minimal end product and customer diversity at ERCO; and

     * the weaker market position of JW Aluminum, Winroc, and SEM.

These weaknesses are offset by the strong market and competitive
positions of Superior Propane and ERCO, and modest, but stable
margins at JWA and Winroc, which offset higher business risks.

The stable outlook reflects the expectation that Superior's
business risk profile will remain relatively unchanged in 2006.
Although Superior's diversity of business segments tempers
volatility arising from seasonal or cyclical changes in any one
industry, the company's acquisition strategy does introduce a
moderate amount of uncertainty to the consolidated credit profile.
A negative rating action is possible if the fund acquires new
businesses with higher business risks, which are not appropriately
offset by stronger financial performance.

In addition, aggressively financed acquisitions, which weaken the
capital structure, would compromise the overall credit profile.
Any subsequent positive rating action would depend on a material
improvement in the company's overall business risk profile, which
is unlikely to occur within its current portfolio of assets.


TFS ELECTRONIC: Wants to Walk Away from Three Equipment Leases
--------------------------------------------------------------
TFS Electronic Manufacturing Services, Inc., asks the U.S.
Bankruptcy Court for the District of Arizona for authority to
reject unexpired personal property leases, effective December 31,
2005.

These three equipment leases include:

   * lease dated July 11, 2003, with Pitney Bowes Credit
     Corporation;

   * lease dated January 28, 2004, with Ikon Office Solutions,
     Inc.; and

   * lease dated October 31, 2001, with General Electric Capital
     Corporation.

The Debtor tells the Court that the said leases are burdensome and
unnecessary to effectuate the company's reorganization.  Thus, the
rejection will minimize any administrative claims the lessors may
assert under the leases.

Headquartered in Redmond, Washington, TFS Electronic Manufacturing
Services, Inc., is an electronics manufacturing services facility
that specializes in New Product Introduction services, prototype
Development and low to medium-volume manufacturing.  The Company
filed for chapter 11 protection on August 19, 2005 (Bankr. D.
Ariz. Case No. 05-15403).  John R. Clemency, Esq., Koriann M.
Atencio, Esq., and Tajudeen O. Oladiran, Esq., at Greenberg
Traurig LLP, represent the Debtor in its restructuring efforts.
When the Debtor filed for protections from its creditors, it
estimated assets between $1 million to $10 million and estimated
debts between $10 million to $50 million.


TOM'S FOODS: 10-1/2% Noteholders Get $38 Mil. Superpriority Claim
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Georgia,
Columbus Division, approved the requests of the Bank of New York
for an order:

   a) granting relief from automatic stay;

   b) fixing the amount of the Bank's superpriority claim; and

   c) directing payment of the Bank's claim.

The Bank of New York is the successor Indenture Trustee and
Collateral Agent under an indenture, dated Oct. 14, 1997, issued
by Tom's Foods in connection with the issue of its 10-1/2% Senior
Notes due November 1, 2004, to a group of lenders.

Under the 1997 $60 million indenture, the Bank asserts an interest
in the proceeds of the sale of the Debtor's assets to Columbus
Capital Acquisitions, Inc.  The sale proceeds are being held in
escrow in accordance with a Court order dated Oct. 19, 2005.  The
Bank wanted the stay lifted so it can get hold of the escrowed
account in satisfaction of its adequate protection liens.

The Court allowed lifting of the automatic stay and ordered Tom's
Foods to pay the $38 million superpriority claim to the Bank out
of the escrowed amount.

Headquartered in Columbus, Georgia, Tom's Foods Inc. manufactures
and distributes snack foods.  Its product categories include
chips, sandwich crackers, baked goods, nuts, and candies.  The
Company filed for chapter 11 protection on April 6, 2005 (Bankr.
M.D. Ga. Case No. 05-40683).  David B. Kurzweil, Esq., at
Greenberg Traurig, LLP, represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed total assets of $93,100,000 and total debts of
$79,091,000.


TOWER AUTOMOTIVE: 9 Trade Creditors Sell Claims Totaling $67.6MM
----------------------------------------------------------------
From October 21 to December 16, 2005, the Clerk of the U.S.
Bankruptcy Court for the Southern District of New York recorded 17
claim transfers to:

(a) Credit Renaissance Partners, L.L.C

           Creditor                           Claim Amount
           --------                           ------------
           American Finance Group              $13,856,130
           American Finance Group               13,856,130
           American Finance Group               13,856,130
           American Finance Group               13,856,130
           Yazaki North America, Inc.            5,065,780

(b) Contrarian Funds

           Creditor                           Claim Amount
           --------                           ------------
           Brookside Environmental Services        $42,064
           Brookside Environmental Services         49,106
           Coca-Cola Bottling Co. Consolidated      34,054
           Coca-Cola Bottling Co. Consolidated       1,169
           Coca-Cola Bottling Co. Consolidated       1,648
           Coca-Cola Bottling Co. Consolidated      53,930

(c) Hain Capital Opportunities, LLC

           Creditor                           Claim Amount
           --------                           ------------
           Baden, Gage & Schroeder, LLC            $65,146

(d) Goldman Sachs Credit Partners L.P.

           Creditor                           Claim Amount
           --------                           ------------
           General Electric Capital Corp.                -

           General Foods Credit Investors                -
           No. 2 Corporation

(e) Madison Investment Trust - Series 17

           Creditor                           Claim Amount
           --------                           ------------
           Goglanian Bakeries, Inc.                 $1,499

(f) SchroderCredRenFund, Ltd. & SchroderCredRenFund, LP

           Creditor                           Claim Amount
           --------                           ------------
           Visteon Corporation                  $1,455,124
           Visteon Corporation                   1,455,124
           Visteon Corporation                   1,455,124
           Visteon Corporation                   2,509,403

Headquartered in Grand Rapids, Michigan, Tower Automotive, Inc.
-- http://www.towerautomotive.com/-- is a global designer and
producer of vehicle structural components and assemblies used by
every major automotive original equipment manufacturer,
including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda,
Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo.  Products
include body structures and assemblies, lower vehicle frames and
structures, chassis modules and systems, and suspension
components.  The Company and 25 of its debtor-affiliates filed
voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y.
Case No. 05-10576 through 05-10601).  James H.M. Sprayregen, Esq.,
Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq.,
and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent
the Debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed
$787,948,000 in total assets and $1,306,949,000 in total
debts.  (Tower Automotive Bankruptcy News, Issue No. 24;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


TOWER AUTOMOTIVE: Deutsche Bank AG Sells $15 Mil. of 5-3/4% Bonds
-----------------------------------------------------------------
In a regulatory filing with the Securities and Exchange Commission
dated November 29, 2005, Jeffrey A. Ruiz, Esq., reports that on
November 28, 2005, Deutsche Bank AG sold $15,000,000 of Tower
Automotive 5-3/4% Convertible Bonds.  DB did not disclose the
price at which it sold those securities.  DB discloses that those
bonds carried a conversion right for 3,465,000 shares of common
stock.

Following the transaction, Deutsche Bank holds:

   -- $23,515,721 of Tower's 5-3/4% Convertible bonds,
      convertible into 5,432,139 common share;

   -- 84,244 of Tower's 6-3/4% Convertible Preferred shares,
      convertible into 137,151 common shares; and

   -- 5,832,190 shares of Tower Automotive, Inc. Common Stock.

Headquartered in Grand Rapids, Michigan, Tower Automotive, Inc.
-- http://www.towerautomotive.com/-- is a global designer and
producer of vehicle structural components and assemblies used by
every major automotive original equipment manufacturer,
including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda,
Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo.  Products
include body structures and assemblies, lower vehicle frames and
structures, chassis modules and systems, and suspension
components.  The Company and 25 of its debtor-affiliates filed
voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y.
Case No. 05-10576 through 05-10601).  James H.M. Sprayregen, Esq.,
Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq.,
and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent
the Debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed
$787,948,000 in total assets and $1,306,949,000 in total
debts.  (Tower Automotive Bankruptcy News, Issue No. 24;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


TRADE AND COMMERCE: Chapter 15 Petition Summary
-----------------------------------------------
Petitioners: Richard Fogerty and
             G. James Cleaver
             Joint Official Liquidators

Debtor: Trade and Commerce Bank (in Liquidation)
        Grand Pavilion
        West Bay Road
        George Town
        Cayman Islands

Case No.: 05-60279

Type of Business: The Debtor is an offshore bank that acts on
                  behalf of the Velox Group.  TCB was created as a
                  full service bank, intended to offer a full
                  range of banking productions available.  TCB's
                  clients were predominantly individuals or
                  companies residing in Argentina, Uruguay and
                  Paraguay, with a small representation of
                  customers from Chile and Brazil.

                  The Velox Group is owned and controlled by
                  members of the Peirano family, and in particular
                  Juan Peirano and his late father Jorge Peirano
                  Facio.  The Peirano family caused TCB to operate
                  two separate sets of accounts.  In essence, one
                  set of accounts was disclosed to the regulators
                  and auditors.  The second set of accounts
                  recorded the fact that the Peirano family
                  withdrew the deposits made by customers of TCB
                  in order to fund the activities of the Velox
                  Group and their own personal lifestyles.  The
                  deposits held by TCB on behalf of its customers
                  were taken without any security being given in
                  return.  See http://www.tcbliquidation.ky/

Chapter 15 Petition Date: December 20, 2005

U.S. Court: Southern District of New York (Manhattan)

Foreign Court: Grand Court of the Cayman Islands

Petitioner's Counsel: Timothy T. Brock, Esq.
                      Abigail Snow, Esq.
                      Jennifer Smith, Esq.
                      Satterlee Stephens Burke & Burke LLP
                      230 Park Avenue
                      New York, New York 10169
                      Tel: (212) 818-9200
                      Fax: (212) 818-9606


TRANSMONTAIGNE INC: Earnings Volatility Prompts S&P's B+ Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
TransMontaigne Inc. to 'B+' from 'BB-' and removed the ratings
from CreditWatch with developing implications, where they were
placed on Sept. 23, 2004.  The outlook is stable.

As of Sept. 30, 2005, Colorado-based TransMontaigne has
$302 million of debt.

"The rating actions are based on the continuing earnings
volatility inherent in TransMontaigne's business model, as
exemplified in TransMontaigne's first-quarter 2006 losses from
pricing disparities in its Southeastern market following Hurricane
Katrina," said Standard & Poor's credit analyst Paul B. Harvey.

In addition, TransMontaigne's business risk profile further
suffered from the contribution of its more stable Florida
terminaling assets to a master limited partnership, TransMontaigne
Partners L.P.

"The increased business risk profile is only somewhat offset by
the improvements to TransMontaigne's financial risk profile,
largely from the commencement of its refined product supply
agreement with Morgan Stanley Capital Group in January 2005,"
Mr. Harvey continued.  TransMontaigne's financial risk profile is
considered more than adequate for the current rating.

The stable outlook reflects expectations that financial
performance and liquidity will remain adequate.

In addition, credit measures should face only moderate volatility
and improvement in debt leverage is expected to remain modest.
Negative rating actions could occur, if TransMontaigne
aggressively pursues acquisitions to the detriment of its improved
debt leverage or fails to adequately limit earnings volatility.
Positive rating actions are not expected in the near term, absent
a company-changing event.


WCI STEEL: Wants Court to Okay Modifications to 2nd Amended Plan
----------------------------------------------------------------
WCI Steel, Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Northern District of Ohio to approve the
modifications they included to their Second Amended Plan of
Reorganization dated Oct. 17, 2005.

The Debtors and Wilmington Trust Company, together with the
Secured Noteholders of WCI Steel, each filed their own plans and
accompanying disclosure statements.  The two disclosure statements
were approved on Oct. 14, 2005.

At a hearing on Nov. 14, 2005, the Debtors read into the record
certain modifications to their proposed Second Amended Plan after
discussions with supporters of the Debtors' Plan, including United
Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied
Industrial and Service Workers International Union2 and The Renco
Group, Inc.

The modifications to the Plan will provide improved treatment of
Class 2 Secured Noteholder Claims and provide several alternatives
for Class 5 Noteholder Claims, permitting a holder to chose the
alternative that it considers most valuable.  In addition, the
modifications make a series of corrections and minor modifications
for issues, including updated dollar amounts and corrected
references.

The Debtors believe that the minor modifications are not material
to the treatment provided by the Plan and do not adversely affect
the treatment of any creditor.  The Debtors believe that the Plan
as modified and corrected meets the requirements of 11 U.S.C.
Section 1122, 1123 and 1129.

The modifications to the Second Amended Plan are:

   1) the New Secured Notes issued to Class 2 has increased from
      $93 million to $97 million, while the New Secured Notes
      issued to Class 5 has decreased from $19 million to
      $18 million, making the aggregate New Secured Notes
      $115 million rather than $112 million;

   2) the Noteholders are provided with an additional option in
      lieu of the 19.9% of common equity:

      a) the option is a preferred interest in New WCI with a face
         amount of $20 million, a 14% cumulative dividend,

      b) cash payments for dividends or redemption are limited
         consistent with the upstreaming limitations of the new
         CBA, provided that there will be no time delay in
         upstreaming permitted for that purpose,

      c) subject to upstreaming limitations on cash, dividends are
         payable either in cash or by PIK, at the option of New
         WCI.  To the extent cash is not available, dividends are
         payable by PIK,

      d) no dividends or other upstreaming, other than those
         allowed by the new CBA, may be paid to Renco until the
         preferred has been redeemed in full, and

      e) Renco will have the option, to purchase the outstanding
         preferred for par plus accrued dividends; and

   3) New WCI will seek offers for purchase of the shares of
      Deficiency Notes for a period of up to 4 months after the
      effective date.  To the extent that the best available offer
      is less than $15 million, New WCI will make a supplemental
      cash distribution to holders who elect to sell to bring the
      total cash consideration to their proportional share of $15
      million.  Each holder may elect to sell, but not less than
      all of its shares of Deficiency Holdings for cash or to
      retain those shares.

Headquartered in Warren, Ohio, WCI Steel, Inc. is an integrated
steelmaker producing more than 185 grades of
custom and commodity flat-rolled steel at its Warren, Ohio
facility.  WCI products are used by steel service centers,
convertors and the automotive and construction markets.  WCI Steel
filed for chapter 11 protection on Sept. 16, 2003 (Bankr. N.D.
Ohio Case No. 03-44662).  Christine M Pierpont, Esq., and G.
Christopher Meyer, Esq., at Squire, Sanders & Dempsey, L.L.P.,
represent the Company.  When WCI Steel filed for chapter 11
protection it reported $356,286,000 in total assets and
liabilities totaling $620,610,000.


WHEREHOUSE ENTERTAINMENT: Wants Until Jan. 13 to Object to Claims
-----------------------------------------------------------------
Wherehouse Entertainment, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware to further
extend, until Jan. 13, 2006, by which they can object to proofs of
claim filed against their estates.

The Court confirmed the Debtors' Joint Plan of Liquidation on
March 15, 2004, and the Plan took effect on June 1, 2004.  The
Debtors' last deadline to object to proofs of claims filed against
their estates expired on Dec. 1, 2005.

The Debtors give the Court three reasons supporting the extension:

   1) they are still continuing the process of winding up their
      estates and now have only one remaining employee to complete
      that process;

   2) the requested extension is necessary to allow the Debtors
      more time and opportunity to thoroughly review all remaining
      claims and ensure the accurate and efficient completion of
      the claims reconciliation process; and

   3) the requested extension is not being sought for purposes of
      delay and it will not prejudice the claimants.

The Court will convene a hearing at 2:30 p.m., on Jan. 9, 2005, to
consider the Reorganized Debtors' request.

Headquartered in Torrance, California, Wherehouse Entertainment,
Inc., sells prerecorded music, videocassettes, DVDs, video games,
personal electronics, blank audio cassettes and videocassettes,
and accessories.  The Company and its debtor-affiliates filed for
chapter 11 protection on January 20, 2003, (Bankr. Del. Case No.
03-10224).  Mark D. Collins, Esq., and Paul Noble Heath, Esq., at
Richards Layton & Finger represent the Debtors in their
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $227,957,000 in total assets and
$222,530,000 in total debts.  The Bankruptcy Court confirmed the
Debtors' Joint Plan of Liquidation on March 15, 2004, and the Plan
took effect on June 1, 2004.


WILLIAMS COS: Extends Tender Offer for Conv. Notes to Jan. 11
-------------------------------------------------------------
The Williams Cos. Inc. (NYSE:WMB) has extended, until 5:00 p.m.
Eastern on Wednesday, Jan. 11, 2006, its previously announced
offer to pay a cash premium to holders of any and all of its
approximately $300 million principal amount outstanding 5.50%
Junior Subordinated Convertible Debentures due 2033 who elect to
convert their debentures to shares of Williams' common stock,
$1.00 par value per share, subject to the terms of the offer.  The
offer was previously scheduled to expire at 11:59 p.m. Eastern on
Thursday, Dec. 15, 2005.

As of 5:00 p.m. Eastern on Thursday, Dec. 15, 2005, holders of
$220,110,750 aggregate principal amount of the outstanding
debentures (constituting 73.4% of the principal amount of the
outstanding debentures) have delivered valid tenders pursuant to
the offer.

Williams has retained Lehman Brothers Inc. and Merrill Lynch & Co.
to serve as the dealer managers for the offer and D.F. King & Co.,
Inc. to serve as the information agent.

Requests for the conversion offer prospectus relating to the offer
and other documents may be directed to:

                  D.F. King & Co., Inc.
                  (800) 848-2998
                  (212) 269-5550.

Questions regarding the offer may be directed to liability
management groups at:

                  Lehman Brothers Inc.
                  (800) 443-0892
                  (212) 526-0111

                      -- or --

                  Merrill Lynch & Co.
                  (800) 654-8637
                  (212) 449-4914

The Williams Companies, Inc. -- http://www.williams.com/--  
through its subsidiaries, primarily finds, produces, gathers,
processes and transports natural gas.  The company also manages a
wholesale power business.  Williams' operations are concentrated
in the Pacific Northwest, Rocky Mountains, Gulf Coast, Southern
California and Eastern Seaboard.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 24, 2005,
Standard & Poor's Ratings Services assigned its 'B+' rating to
The Williams Cos., Inc., Credit-Linked Certificate Trust IV's
$100 million floating-rate certificates due May 1, 2009.

The rating reflects the credit quality of The Williams Cos., Inc.,
('B+') as the borrower under the credit agreement and Citibank
N.A. ('AA/A-1+') as seller under the subparticipation agreement
and account bank under the certificate of deposit.

The rating addresses the likelihood of the trust making payments
on the certificates as required under the amended and restated
declaration of trust.


WORLDCOM INC: Court OKs Summary Judgment on Holley Clark's Claim
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
granted WorldCom, Inc., and its debtor-affiliates summary judgment
and disallow Claim No. 10798 in its entirety.

As reported in the Troubled Company Reporter on September 22,
2005, Holley Clark filed a civil action against WorldCom, Inc. and
its debtor-affiliates, asserting retaliation.  Ms. Clark's case
was later removed to the U.S. District Court for the Eastern
District of California.

The Debtors filed a request for summary judgment on Ms. Clark's
Claim, and the California District Court granted the Debtors'
request.  The District Court dismissed Ms. Clark's civil action.

Ms. Clark took an appeal of the District Court's decision to the
Ninth Circuit Court of Appeals.  The Ninth Circuit affirmed the
District Court's ruling.

The time to file a petition for rehearing on the Ninth Circuit's
Order expired on December 1, 2004.  The time to file a petition
for writ of certiorari with the Supreme Court likewise expired on
February 15, 2005.

Ms. Clark did not seek review of the Ninth Circuit's Order.
Instead, Ms. Clark filed Claim No. 10798 for $250,000 against the
Debtors, using "retaliation" as the basis for her claim.

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532).  On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts.  The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 109; Bankruptcy Creditors' Service,
Inc., 215/945-7000)

                          *********

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., Tara Marie Martin, 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.

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