TCR_Public/060126.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, January 26, 2006, Vol. 10, No. 22

                             Headlines

A.K. CORP.: Case Summary & 3 Largest Unsecured Creditors
ADELPHIA COMMS: Equity Panel Wants Morgenstern Jacobs as Counsel
ADVANCED BEAUTY: Case Summary & 20 Largest Unsecured Creditors
ADVANCED MICRO: Fitch Revises Outlook to Positive From Stable
ADVANCED MICRO: Moody's Raises $1.1 Billion Notes' Ratings to B1

ADVANCED MICRO: Improved Performance Cues S&P's Positive Watch
ANCHOR GLASS: Wants to Postpone Disclosure Statement Hearing
ANCHOR GLASS: Madeleine Asserts $15,562,861 Claim
ANCHOR GLASS: Wants to Continue Ernst & Young's Employment
ARMSTRONG WORLD: Wants Plan-Filing Period Stretched to Sept. 6

ATLANTIC HEALTH: Case Summary & 20 Largest Unsecured Creditors
AUSTIN CO: Court Okays Schottenstein Zox as Panel's Bankr. Counsel
AUSTIN COMPANY: Has Until Feb. 11 to Make Lease-Related Decisions
BEAZER HOMES: Earns $89.9MM of Net Income in First Fiscal Quarter
BECKMAN COULTER: Moody's Rates Sub. Shelf Registration at (P)Ba1

BROWNSVILLE GENERAL: Case Summary & 20 Largest Unsecured Creditors
BUCKEYE TECH: Earns $1.9 Million in Quarter Ended Dec. 31, 2005
CALPINE CORP: Gets Final Approval to Obtain $2 Bil. DIP Financing
CHARTER COMMS: CCH II to Sell $400 Million of Senior Notes
CITIGROUP MORTGAGE: Fitch Affirms Class B-5 Loans' Rating at B

CLEAN EARTH: Voluntary Chapter 11 Case Summary
COLLINS & AIKMAN: GECC Says Lear Can't Set-Off Debt
COLLINS & AIKMAN: Kimsworth Wants to Collect Unpaid Rent and Taxes
COLLINS & AIKMAN: Panel Supports Denial of IRS & Breitkreuz Plea
CORDOVA FUNDING: Moody's Upgrades Sr. Sec. Bonds' Rating to Ba3

CORNELL TRADING: Can Use Lender's Cash Collateral on Interim Basis
CORNELL TRADING: Hires Craig & Macauley as Bankruptcy Counsel
COUNTRYWIDE HOME: Fitch Lifts Ratings on Classes B3 & B4 Certs.
DELTA AIR: Balks at Retiree's Request to Bar Use of Trust Funds
DELTA AIR: Gets Court Nod to Enter Into Derivative Contracts

DLJ MORTGAGE: Fitch Holds DD Ratings on Five Certificate Classes
DMX MUSIC: Wants Plan-Filing Period Stretched to March 17
DORAL FINANCIAL: Has Until April 24 to File Financial Statements
DRS TECHNOLOGIES: Prices Offering of $600 Million Senior Notes
ECHOSTAR COMMS: Offering $1B of Common Shares to Buy Back Notes

FLYI INC: Sells Westchester Terminal & Ramp Allocations to AirTran
FLYI INC: Goodrich Wants Carrier to Decide on Maintenance Contract
FLYI INC: Aviall Services Wants to Set-Off Prepetition Claims
FORD MOTOR: Restructuring Plan Calls For Job Cuts & Plant Closures
FORD MOTOR: North American Biz Incurs $1.6B Pre-Tax Loss in 2005

GALAXY 1999-1: Fitch Affirms $30 Mil. Class C-2 Notes' BB- Rating
GALVEX HOLDINGS: Wants Court OK to Use SPCP's Cash Collateral
GARDEN RIDGE: Court Approves $593,422 Wausau Settlement Pact
GENEVA STEEL: Trustee Settles GATX Capital Lease Dispute
GMAC MORTGAGE: Fitch Raises Class B-2 Certificates' Rating to BB+

GSI GROUP: Robert E. Girardin Replaces Randall N. Paulfus as CFO
HAROLD'S STORES: Lenders Up Borrowing Availability by $3 Million
HEADWATERS INC: Earns $28.3 Million in Quarter Ended Dec. 31
IELEMENT CORP: Posts $328,262 Net Loss in Quarter Ended Dec. 31
INTERNATIONAL SPECIALTY: S&P Lowers Corporate Credit Rating to BB-

LEASEWAY MOTORCAR: Chapter 11 Case Summary
LEGACY ESTATE: Gets Interim OK to Access Lenders' Cash Collateral
LEGACY ESTATE: Taps Morrison & Foerster as Special Counsel
LUCENT TECHNOLOGIES: Posts $104 Million Net Loss in First Quarter
MAXICARE HEALTH: Marcum & Kliegman Replaces E&Y as Auditor

MCI INC: Qwest Sues MCI To Recover $10,000,000 in Access Charges
MED GEN: Stark Winter Raises Going Concern Doubt
MEDICALCV INC: Registers 78,774,966 Common Shares for Resale
MERIDIAN AUTOMOTIVE: Wants Foley & Lardner as Special Counsel
MERIDIAN AUTOMOTIVE: Wants to Assume Amended GR Glen Lease

MERIDIAN AUTOMOTIVE: Has Until May 25 to Decide on 12 Leases
MESABA AVIATION: Wants Court Approval on Amended CBA with TWU
MESABA AVIATION: Court Okays Rejection of Pinnacle Aircraft Lease
MESABA AVIATION: Panel Balks at Continued Use of Incentive Plans
MIRANT CORP: Bankruptcy Court Appoints Three Plan Trustees

MIRANT CORP: Court Approves Canada Unit's Refinancing Agreement
MIRANT CORP: Wants Court to Okay D&O Indemnity Claims Protocol
MUSICLAND HOLDING: U.S. Trustee Appoints 7-Member Creditors Panel
MUSICLAND HOLDING: Gets Interim Okay to Invest and Deposit Funds
MUSICLAND HOLDING: Morgan Lewis Represents Trade Vendors Committee

NEW GENERATION: Files 1st, 2nd & 3rd Quarter 2005 Financials
NOBLE DREW: Panel Calls for Termination of Exclusive Periods
NORTHWEST AIR: Retiree's Balk at Move to Modify Medical Benefits
NORTHWEST AIR: Retiree Committee Hires Jenner & Block as Counsel
PLYMOUTH RUBBER: Four Creditors Want Exclusive Period Terminated

SCIENTIFIC GAMES: Moody's Affirms Low-B Sr. & Sub. Debt Ratings
SEDGWICK CMS: Moody's Rates $340 Million Credit Facility at B1
SENIOR HOUSING: Mass. Court Orders HealthSouth to Pay Profits
SENSE TECHNOLOGIES: Posts $367K Net Loss in Quarter Ended Nov. 30
TIDEL TECH: Selling Cash Security Biz to Sentinel for $17.5M

UAL CORPORATION: New Shares to be Listed on NASDAQ Stock Market
W.R. GRACE: Battles Anderson Memorial on Class Certification Move
W.R. GRACE: Asbestos PD Panel Gets Court Okay to Hire Dies & Hile
W.R. GRACE: Dec. 31 Balance Sheet Upside-Down by $595.6 Million
WHITEHALL JEWELLERS: Special Meeting Postponed Until Feb. 6, 2006

WODO LLC: Judge Overstreet Confirms Third Amended Chapter 11 Plan
WORLDCOM INC: Inks Stipulation Settling U.S. Defense Dept. Claims

                             *********

A.K. CORP.: Case Summary & 3 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: A.K. Corp.
        1115 Franklin Turnpike
  Danville, Virginia 24540

Bankruptcy Case No.: 06-60078

Type of Business: The Debtor operates a construction company.
                  A.K. Corp. previously filed for chapter 11
                  protection on Dec. 13, 2005 (Bankr. W.D. Va.
                  Case No. 05-65126)

Chapter 11 Petition Date: January 24, 2006

Court: Western District of Virginia (Lynchburg)

Judge: William E. Anderson

Debtor's Counsel: A. Carter Magee, Jr., Esq.
                  William J. Charboneau, Esq.
                  Magee, Foster, Goldstein & Sayers, PC
                  P.O. Box 404
                  Roanoke, Virginia 24003-0404
                  Tel: (540) 343-9800
                  Fax: (540) 343-9898

Total Assets: $1,749,922

Total Debts:   $515,774

Debtor's 3 Largest Unsecured Creditors:

   Entity                                   Claim Amount
   ------                                   ------------
Dovie A. Ferrell                                 $47,000
dba A.K. Ferrell Construction
906 Vicar Road
Danville, VA 24540

Aubrey K. Ferrell, II                            $18,389
5053 Jefferson Road
Danville, VA 24540

Harris, Harvey, Neal & Co., LLP                   $2,018
c/o Brad Reynolds
2309 Riverside Drive
Danville, VA 24541


ADELPHIA COMMS: Equity Panel Wants Morgenstern Jacobs as Counsel
----------------------------------------------------------------
Pursuant to Sections 328 and 1103 of the U.S. Bankruptcy Code and
Rule 2014 of the Federal Rules of Bankruptcy Procedure, the
Official Committee of Equity Security Holders in Adelphia
Communications Corporation and its debtor-affiliates' Chapter 11
cases seeks the U.S. Bankruptcy Court for the Southern District of
New York's authority to retain Morgenstern Jacobs & Blue, LLC, as
its counsel.

MJB will replace Bragar Wexler Eagel & Morgenstern, P.C.

The attorneys at Bragar Wexler who have had primary
responsibility for representation of the Equity Committee, as
well as almost all of the other professionals and
paraprofessionals who have represented the Equity Committee while
affiliated with Bragar Wexler, will continue to represent the
Equity Committee after the proposed substitution.

Since the time of Bragar Wexler's retention as the Equity
Committee's sole general counsel, Peter Morgenstern, Esq., Mark
Jacobs, Esq., and Gregory Blue, Esq., have led the legal team
that has devised and implemented the Equity Committee's
strategies in ACOM's proceedings.

Effective as of January 1, 2006, Bragar Wexler is splitting into
two law firms, Bragar Wexler & Eagel, P.C., and MJB.  Each of the
Principal Attorneys, together with almost all of the other Bragar
Wexler attorneys who have been involved in the representation of
the Equity Committee, will be practicing law as members or
associates of MJB.

Faisal Syed, a representative of the Equity Committee, relates
that over the past three years, each of the Principal Attorneys
have obtained a deep and broad working knowledge of many of the
complex facts and dynamics of the Debtors' cases.  In
particularly complex chapter 11 cases like ACOM, the ability to
continue to utilize that knowledge will have the effect of
reducing the costs of the Equity Committee's legal
representation.

Mr. Syed explains that the retention of MJB as counsel for the
Equity Committee will not result to:

    -- additional costs to the estate;

    -- interruption to the representation of the Equity Committee;
       and

    -- any delay of the proceedings.

Although the firm representing the Equity Committee will change,
effectively, the Equity Committee will continue to be represented
by the same attorneys who have represented the Committee for the
past three years, Mr. Syed says.

Peter D. Morgenstern, Esq., a member of MJB, believes that the
firm does not hold or represent an interest adverse to the
Debtors' estates in the matters upon which it is to be employed.
He attests that MJB is "disinterested" as that term is defined in
Section 101(14) of the Bankruptcy Code.

Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country.  Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks.  The Company and its more than 200
affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002.  Those cases are jointly
administered under case number 02-41729.  Willkie Farr & Gallagher
represents the ACOM Debtors.  (Adelphia Bankruptcy News, Issue
No. 119; Bankruptcy Creditors' Service, Inc., 215/945-7000)


ADVANCED BEAUTY: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Advanced Beauty Solutions LLC
        18344 Oxnard Street, Suite 201
        Tarzana, California 91316

Bankruptcy Case No.: 06-10076

Chapter 11 Petition Date: January 24, 2006

Court: Central District of California (San Fernando Valley)

Judge: Geraldine Mund

Debtor's Counsel: James C. Bastian, Jr., Esq.
                  Shulman Hodges & Bastian LLP
                  26632 Towne Centre, Suite 300
                  Foothill Ranch, California 92610-2808
                  Tel: (949) 340-3400

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Datapak Services Corp. and       Judgment Lien         $810,394
Datapak Postage                  filed with the
55353 Lyon Industrial Drive      California
New Hudson, MI 48165             Secretary of
Attn: Robert Lahiff, Esq.        State on
General Counsel                  Oct. 25, 2005,
Tel: (248) 446-9500              No. 05-7046510987

Impulse Response Group Inc.      Trade Debt            $184,095
501 North 44th Street, Suite 2
Phoenix, AZ 85008

Liquid Technologies Inc.         Trade Debt            $136,000
14510 Monte Vista Avenue
Chino, CA 91710

The Hartford                     Trade Debt             $87,741
P.O. Box 2907
Hartford, CA 06104-2907

Alico Packaging Inc.             Trade Debt             $61,294

Holden Color Inc.                Trade Debt             $49,962

TLC Express Lines                Trade Debt             $41,311

Tristar Products Inc.            Loan                   $38,128

Applied Perceptions LLC          Trade Debt             $26,687

Sherburne Properties Inc.        Trade Debt             $31,000

Victory Foam                     Trade Debt             $16,565

Advantage Media Services Inc.    Trade Debt             $16,490

SF Video Inc.                    Trade Debt             $15,419

Rachel Davies                    Trade Debt             $14,867

SSA Public Relations             Trade Debt             $13,697

Treehouse Media Services Inc.    Trade Debt             $11,913

Gared Graphics                   Trade Debt             $10,641

ASI Entertainment                Trade Debt              $8,647

Crockett Container Corp.         Trade Debt              $8,358

VANTAGEdr                        Trade Debt              $7,457


ADVANCED MICRO: Fitch Revises Outlook to Positive From Stable
-------------------------------------------------------------
Fitch Ratings revised Advanced Micro Devices Inc.'s (AMD) Rating
Outlook to Positive from Stable and affirmed the company's 'B'
issuer default rating (IDR).  AMD's 'B/RR4' senior unsecured debt
and 'BB/RR1' senior secured bank credit facility are also
affirmed.  Fitch's action affects approximately $1.2 billion of
total debt.

The Positive Outlook reflects AMD's:

   * improved financial performance;

   * strong operating momentum over the past year, which Fitch
     expects will continue over the near term;

   * greater than expected debt reduction; and

   * successful partial spin-off of Spansion Incorporated
     (Spansion Inc.; rated 'B-', with a Negative Outlook, by
     Fitch).

AMD's leading product technology (64-bit architecture and dual-
core processors) has allowed the company to increase its global
microprocessor (MPU) market share to more than 15% for the quarter
ended Dec. 31, 2005, compared to less than 10% in the prior year
quarter.  During this time period, Intel Corp., AMD's primary
competitor with a dominant share of the MPU market, has been
unable to use its significant pricing power and manufacturing
advantage to drive down average selling prices.  Improving gross
margins and the resultant higher EBIT levels, which increased to
16.3% for 2005 from 12% in 2004 and negative 1.2% in 2003, has
mitigated some of the substantial costs associated with the
construction and equipment purchases for AMD's advanced technology
manufacturing facility, fab 36.

The Positive Outlook also reflects recent and greater than
anticipated debt reduction.  Pro forma for the anticipated
redemptions, including $500 million of 4.75% senior unsecured
debentures due 2022 and $210 million reduction of 7.75% senior
unsecured notes due 2012, AMD will have used cash from operations,
funds received from an equity offering, and Spansion's repayment
of inter-company notes (following the partial spin-off on Dec. 21,
2005) to reduce debt by approximately $1 billion.  Debt was also
reduced by deconsolidating almost $450 million of debt related to
Spansion, as a result of AMD reducing its investment in Spansion
to 37.9% from 60%.  Nonetheless, Fitch notes that AMD will be able
to draw down a EUR700 million senior secured term-loan facility in
mid-2006 to purchase equipment for fab 36.

Positive rating action could result from AMD gaining additional
market share and maintaining currently high utilization rates even
as the company and Intel bring on additional capacity in 2006.
Fitch notes that the completion of fab 36, which is scheduled to
ramp in the second half of 2006, will more than double the
company's capacity over the next three years.  As a result, AMD
must continue to outgrow the MPU market, which is expected to
increase 10% for 2006, to absorb this extra capacity and remain at
or near current gross margins.  At the same time, the ratings
could stabilize or be pressured as a result of the company
meaningfully falling short of unit market share targets, or
Intel's product refresh, scheduled for the second half of 2006,
potentially resulting in significant ASP pressures for AMD.

The ratings continue to reflect AMD's:

   * significant ongoing capital spending and research and
     development requirements;

   * improving but still limited market share;

   * vulnerability to Intel's aggressive pricing actions;

   * historical negative free cash flow and operating losses,
     which have improved but will remain pressured;

   * expectations for continued relatively high debt levels; and

   * exposure to the volatile cash flows and cyclical demand of
     the semiconductor market.

Rating strengths center on AMD's currently leading-technology
product portfolio, which has enabled the company to meaningfully
expand its commercial customer base, gain share in the MPU market,
and expand gross margins as a result of a richer sales mix.  In
addition, upon completion of fab 36, AMD should have sufficient
manufacturing capacity to become a strategic long-term supplier
for large personal computer makers.  The company's lower pro forma
debt levels and manageable debt maturity schedule also support the
rating.

As of Dec. 31, 2005, AMD's liquidity pro forma for the redemption
of $500 million 4.75% senior unsecured debentures on Feb. 6, 2006,
was sufficient to meet near-term obligations and was supported by
cash and cash equivalents of approximately $1.3 billion and an
undrawn $100 million secured revolving credit facility expiring
July 2007.  Over the intermediate term, free cash flow is expected
to continue to be negative (in excess of negative $500 million in
2006) due primarily to higher capital expenditures and R&D
expenses.  Total debt pro forma for the redemption of $500 million
of 4.75% senior unsecured debentures due 2022 was $870 million at
quarter-end and consisted primarily of $600 million 7.75% senior
unsecured notes due 2012, while silent partnership contributions
and various capital leases and deferred grants comprise the rest
of debt.  Debt amortization payments are approximately $200
million over the next few years.


ADVANCED MICRO: Moody's Raises $1.1 Billion Notes' Ratings to B1
----------------------------------------------------------------
Moody's Investors Service raised the corporate family rating of
Advanced Micro Devices, Inc. two notches to Ba3.  The outlook is
stable.

The upgrade reflects the:

   1) the company's continued solid execution in broadening the
      end market capabilities, competitiveness, revenue and
      profitability of its microprocessor business that are the
      core of the company;

   2) the improved ability for AMD to translate these strengths
      into sustainable free cash flow from operations over time;

   3) the significantly improved capital structure of AMD
      following a combination of the recent Spansion spin-off;
      last night's $500 million equity offering and its related
      $210 million "clawback" repayment of senior unsecured debt
      and; the pending redemption of a $500 million convertible
      note that should be completed February 6, 2006; and

   4) the solid and improved financial flexibility as a result of
      its strong operational performance, equity capital raising,
      and debt reduction whereby pro forma cash balances will
      approximate $2.1 billion and debt $870 million.

At the same time, a meaningful level of business risk persists,
deriving from intense microprocessor product and price competition
from its much larger competitor, Intel Corporation; significant
capital expenditure requirements and execution risk to
consistently transition to new technology nodes and manufacturing
capabilities for microprocessors, including its current production
ramp at Fab 36 in Dresden.

Ratings upgraded include:

   * Corporate Family Rating - Ba3 up from B2

   * Senior unsecured note $600 million due 2012 - B1 up from B3

   * Senior convertible notes $500 million due 2022 - B1 up
     from B3 (rating will be withdrawn following conclusion of
     call, expected to occur Feb. 6, 2006)

   * Senior secured shelf registration -- (P) Ba3 up from (P) B2

   * Senior unsecured shelf registration -- (P) B1 up from (P) B3

   * Subordinated shelf registration -- (P) B2 up from (P) Caa1

   * Preferred stock shelf registration -- (P) B3 up from (P) Caa2

The one notch differential between the corporate family rating and
the senior unsecured rating reflects Moody's expectation that up
to approximately $800 million of secured debt may enter into the
company's capital structure as part of its ongoing capital
expenditure funding for Fab 36 in Dresden, Germany.  The company's
bond indentures permit secured debt but limits the amount to 5% of
consolidated net tangible assets, as defined.

Moody's said the ratings incorporate the expectation that AMD will
continue to successfully develop and introduce microprocessors
that allows AMD to increasingly target not just its traditional
desktop market but also the server and mobile markets, areas where
historically AMD has had only a small presence.  During 2005, AMD
made significant and accelerating progress in penetrating the
server and mobile markets.  To the extent that AMD is able to
further penetrate these newer markets, the resultant mix should
lead to richer average selling prices and improved profitability
and cash flow generation, provided AMD's solid manufacturing
efficiencies continue.

Since introducing its Opteron microprocessor family in early 2003
and subsequently, versions of its Athlon microprocessors, AMD has
further expanded its customer base and notably improved
microprocessor revenues.  Microprocessor revenues have grown
between 22% and 79% y/y in each of the last nine quarters,
approaching $1 billion quarterly in the September 2005 quarter and
exceeding $1.3 billion in the December 2005 quarter.  At the same
time, microprocessor operating profit margin reached 22% in the
fourth quarter just ended, up notably from the 10% to 14% range
recent quarters.  A minor offset to this solid segment performance
trend is that AMD's other Personal Interconnect Communicator
segment, which most recently has quarterly revenues of $42 million
with continued losses of $15 million.  This segment will continue
to be part of AMD going forward and to the extent that it
continues to lose money, it would detract from the success of its
microprocessor operations.

With respect to AMD's flash memory operations (Spansion),
conducted through a joint venture with its long time partner
Fujitsu Limited, the recently concluded initial public offering
resulted in Spansion now being owned approximately 38% by AMD, 25%
by Fujitsu and 37% publicly held.  While there are shared service
arrangements through 2006, AMD has no obligations to financially
support Spansion.  Also, after a 180 day lockup, AMD and Fujitsu
can further reduce their stakes.

Liquidity and financial leverage have improved notably.  Following
the Spansion IPO, equity issuance and the clawback by the senior
unsecured notes, cash balances will approximate $2.1 billion.  
From a debt perspective, including the recent conversion of $201
million of 4.5% senior convertible debt on Dec. 2, 2005, the $210
million clawback by the senior unsecured notes and the pending
conversion to equity of $500 million of 4.75% senior convertible
debt, AMD will have about $870 million of debt.  On this basis,
debt to book capitalization approximates 16%, down from 40% in
most prior periods.  Given our expectations of continued solid
operational performance and earnings over the intermediate term,
combined with the possibility of further debt reduction, leverage
is likely to decline further.

The ratings could experience upward pressure to the extent that
AMD is able:

   1) to make further progress towards achieving sustainable free
      cash flow from operations; and

   2) to continue to profitably grow and diversify its core
      microprocessor among end market platforms (desktop, server,
      mobile computing) while at the same time reducing or
      containing the losses in its other remaining operations.

Alternatively, the ratings could face downward pressure:

   1) if the company's heretofore solid operational execution
      falters for a sustained period of time;

   2) if its currently solid liquidity profile erodes materially;
      or

   3) if there is a reversal in the material deleveraging that the
      company has achieved.

Advanced Micro Devices, Inc., headquartered in Sunnyvale,
California, designs and manufactures microprocessors and other
semiconductors products.


ADVANCED MICRO: Improved Performance Cues S&P's Positive Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B' corporate credit
rating and other ratings on Sunnyvale, California-based Advanced
Micro Devices Inc. on CreditWatch with positive implications,
reflecting the company's improving business and financial profile,
notwithstanding aggressive competition.
      
"AMD has improved its operating profitability through an enriched
product line and improved manufacturing performance, and has
reduced its exposure to the commodity memory industry through the
IPO of its Spansion Inc.," said Standard & Poor's credit analyst
Bruce Hyman subsidiary.

Further, AMD's 4.75% convertible senior debentures due 2022 are in
the money, and are expected to convert to equity on Feb. 6, 2006,
provided AMD's stock price remains reasonably above the conversion
price of $23.38 per share.  Also, on Jan. 23, 2006, the company
announced a planned $500 million offering of common stock, the net
proceeds of which would be used to fund the redemption of up to
35% of the aggregate principal amount of its 7.75% senior notes
due 2012 and for capital expenditures, working capital and other
general corporate purposes.  The completed and pending financing
transactions would reduce the company's nearer-term debt burden.
Ratings continue to reflect aggressive competition from dominant
supplier Intel Corp. and possible continued negative free cash
flows over the intermediate term.
     
AMD is the second-largest supplier of personal computer
microprocessors.  The company has been strengthening its product
line and improving its manufacturing performance, which have led
to solid market share gains in the enterprise server and consumer-
grade personal computer markets, contributing to higher revenues
and improved operating profitability.  

Still, AMD is noticeably weaker in the enterprise desktop and
laptop markets, and its overall market share, while improving,
remains below 20%.  Although the company's R&D expenditures are
also about 20% of Intel's, a joint R&D agreement with IBM Corp.
has provided the company with a multi-year advanced technology
plan, while a new factory now entering volume production should be
capable of manufacturing substantial quantities of advanced chips
for a number of years.  The IPO of AMD's Spansion subsidiary
occurred in late 2005, and AMD now owns approximately 38% of
Spansion, compared with 60% before the IPO.


ANCHOR GLASS: Wants to Postpone Disclosure Statement Hearing
------------------------------------------------------------
Since the filing of its Plan of Reorganization and Disclosure
Statement, Anchor Glass Container Corporation received comments
on those documents from some significant parties-in-interest like
the Ad Hoc Committee of Noteholders, the Official Committee of
Unsecured Creditors and The Bank of New York.  

As requested by the parties-in-interest, the Debtor intends to
make certain changes to the Plan of Reorganization and Disclosure
Statement.  The Debtor, however, needs additional time to address
and resolve the issues raised.

The Debtor, therefore, asks the U.S. Bankruptcy Court for the
Middle District of Florida to continue the Disclosure Statement
hearing until a date after February 9, 2006, and set a new date
for the filing of objections.

The Debtor has asked certain parties-in-interest not to file
formal objections to the Disclosure Statement at this time in the
hope that these issues can be resolved consensually.

Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States.  Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets.  The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606).  Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts. (Anchor Glass Bankruptcy News, Issue No. 17;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ANCHOR GLASS: Madeleine Asserts $15,562,861 Claim
-------------------------------------------------
Anchor Glass Container Corporation is indebted to Madeleine LLC
pursuant to a Loan and Security Agreement dated February 14,
2005.  Madeleine holds a security interest in the Debtor's
property, including a junior security interest on the Debtor's
accounts and inventory, and certain other collateral.

Madeleine asserts a claim in the Debtor's case for $15,373,880 as
of the Petition Date.

On September 15, 2005, Debtor executed a payoff letter and
tendered to Madeleine $15,912,861, which included, interest fees
and costs.  Madeleine received the Payoff and deposited it in a
segregated account.

Pursuant to the Cash Collateral Order, the Official Committee of
Unsecured Creditors conducted an investigation of Madeleine's
liens, claims and interest arising under the Madeleine Loan
Agreement.  The Committee and Madeleine have agreed to terminate
the Creditors Committee's deadline to investigate and challenge
the liens, claims and interests of Madeleine under the Madeleine
Loan Agreement.

By this motion, Madeleine asks the U.S. Bankruptcy Court for the
Middle District of Florida to:

   (a) deem its claim allowed in the reduced amount of
       $15,562,861 -- Revised Payoff; and

   (b) authorize the disbursement of the Revised Payoff to
       Madeleine for application to the obligations under the
       Madeleine Loan Agreement.

Madeleine agrees to return $350,000 in excess cash to an escrow
account for the benefit of the general unsecured creditors.  
Madeleine proposes that the escrowed funds be released upon
confirmation of a plan of reorganization in the Debtor's case.

Madeleine also asks the Court to terminate the deadline for the
Official Committee of Unsecured Creditors to investigate and
challenge the liens, claims and interests of Madeleine under the
Madeleine Loan Agreement.

Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States.  Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets.  The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606).  Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts. (Anchor Glass Bankruptcy News, Issue No. 17;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ANCHOR GLASS: Wants to Continue Ernst & Young's Employment
----------------------------------------------------------
Before Anchor Glass Container Corporation sought chapter 11
protection, the company employed Ernst & Young LLP to provide tax
consulting services and assistance in certain tax appeals.  The
Debtor desires to continue utilizing E&Y LLP's services because of
the firm's considerable experience and expertise and its
familiarity with the Debtor's tax issues.

Hence, the Debtor asks permission from the U.S. Bankruptcy Court
for the Middle District of Florida to employ E&Y as its tax
advisors.

E&Y LLP will:

   (a) help in assessing the validity of property tax claims
       and the reclassification of tax claims as non-priority;

   (b) assist in settling tax claims and obtaining refunds of
       reduced claims for federal and state income, franchise,
       payroll, sales and use, property, excise and business
       license;

   (c) work with other professionals in developing an
       understanding of reorganization and restructuring
       alternatives;

   (d) assist the Debtor in improving its tax posture as part of
       Debtor's restructuring and post-bankruptcy operations;

   (e) provide tax consultation regarding availability,
       limitations, preservation and augmentation of tax
       attributes; and, as needed, research, discuss and analyze
       federal and state income and franchise tax issues;

   (f) analyze the legal and other professional fees incurred
       for purposes of determining future deductibility of the
       costs;

   (g) document tax analysis, opinions, recommendations,
       conclusions and correspondence for any proposed
       restructuring alternative, bankruptcy tax issue or other
       tax matters;

   (h) facilitate Georgia refund claim for sales tax and secure
       the refunds for the Debtor;

   (i) provide the Debtor with audit representation services
       that encompass all aspects of the Georgia Department of
       Revenue's audit process, from pre-audit conference to
       administrative hearings, if necessary;

   (j) perform the property tax services for all jurisdictions
       of Debtor's operations, excluding New York and New
       Jersey; and

   (k) as requested by the Debtor, provide any additional tax
       consulting services.

The Debtor will pay E&Y LLP in its customary hourly rates, plus
reimbursement of necessary expenses incurred while in service to
the Debtor:

   Professionals                        Hourly Rates
   -------------                        ------------
   Partners, Principals & Directors      $502-$633
   Senior Managers                       $492-$540
   Managers                              $382-$435
   Seniors                               $275-$349
   Staff                                 $119-$195
   Administrative Personnel               $94-$200

T. Stephen Gillespie, a partner at Ernst & Young LLP, assures the
Court that the firm does not represent any interest adverse to
the Debtor.

As of July 27, 2005, the Debtor owes to E&Y LLP $50,000 for
prepetition services.  Mr. Gillespie tells the Court that E&Y LLP
has waived its right to receive any fees incurred on the Debtor's
behalf prior to the Petition Date.

Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States.  Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets.  The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606).  Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts. (Anchor Glass Bankruptcy News, Issue No. 17;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ARMSTRONG WORLD: Wants Plan-Filing Period Stretched to Sept. 6
--------------------------------------------------------------
As reported in the Troubled Company Reporter on Jan. 4, 2006, the
U.S. Court of Appeals for the Third Circuit issued an opinion
affirming the United States District Court for the District of
Delaware's denial of confirmation of the Plan of Reorganization of
Armstrong World Industries, Inc., and its two debtor-affiliates.

The Third Circuit's affirmance of the District Court order was
unexpected and unanticipated, according to Rebecca L. Booth, Esq.,
at Richards, Layton & Finger, P.A., in Wilmington, Delaware.

AWI is now faced with the task of formulating alternative
proposals for emergence from Chapter 11 and currently is engaged
in negotiations with representatives of its key constituencies
toward that end, Ms. Booth relates.  AWI continues to maintain an
open dialogue with all the Committees in the hope that it may once
again forge a consensus that will form the basis for its emergence
from Chapter 11.  In the absence of a consensus, AWI is exploring
other options for emergence from Chapter 11.

While AWI pursues its emergence options, it is only fair and
logical to maintain the status quo, Ms. Booth maintains.  "This is
particularly appropriate where AWI achieved a consensus with
respect to a plan as contemplated by chapter 11, but where,
through no fault of its own, it was unable to bring the plan to
consummation."

Accordingly, the Debtors ask the U.S. Bankruptcy Court for the
District of Delaware to extend their exclusive periods to:

    -- file a plan of reorganization to September 6, 2006; and

    -- solicit acceptances of that plan until November 8, 2006.

Ms. Booth argues that the termination of the Exclusive Periods
would expose the Debtors' estates to the uncertainty of multiple
plans of reorganization being proposed with the attendant
confusion, dislocation and negative impact on their operations,
asset values, and employee morale.

The Debtors' efforts at preserving and stabilizing their
businesses have been extremely successful and have served to
maximize value for the benefit of the entire reorganization
effort, Ms. Booth tells the Court.  "The termination of merely a
short extension of the Exclusive Periods would impair and
undermine, for no rational reason, the stabilization in the
Debtors' cases."

An additional extension of the Exclusive Periods will neither
prejudice nor put pressure in any party-in-interest, Ms. Booth
contends.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior floor coverings and ceiling
systems, around the world.  The Company and its debtor-affiliates
filed for chapter 11 protection on December 6, 2000 (Bankr. Del.
Case No. 00-04469).  Stephen Karotkin, Esq., at Weil, Gotshal &
Manges LLP, and Russell C. Silberglied, Esq., at Richards, Layton
& Finger, P.A., represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed $4,032,200,000 in total assets and
$3,296,900,000 in liabilities.  (Armstrong Bankruptcy
News, Issue No. 87; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


ATLANTIC HEALTH: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Atlantic Health Services, Inc.
        600 Jefferson Plaza, Suite 305
        Rockville, Maryland 20852

Bankruptcy Case No.: 06-10356

Chapter 11 Petition Date: January 24, 2006

Court: District of Maryland (Greenbelt)

Judge: Paul Mannes

Debtor's Counsel: Jonathan P. Morgan, Esq.
                  Rose & Morgan, LLC
                  50 West Edmonston Drive, Suite 600
                  Rockville, Maryland 20852
                  Tel: (301) 838-2010

Estimated Assets: $500,000 to $1 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Carmel Kalunga                Judgment                  $570,583
c/o Kathleen Carey
1400 16th Street,
Northwest, Suite 520
Washington, DC 20036

IRS Insolvency Unit           Withholding taxes         $553,384
Fallon Federal Building,
Suite 1120
31 Hopkins Plaza
Baltimore, MD 21201

Feldsman Tucker Leifer        Attorney fees              $32,587
2001 L. Street, Suite 200
Washington, DC 20036

Comptroller of Treasury       Withholding taxes          $30,000

Virginia Dept of Taxation     Withholding taxes          $20,000

FT Solutions                  Attorney fees              $10,209

Harcourt Assessment           Trade debt                  $8,875

Robinson & Jacobs             Immigration fees            $7,936

Staples                       Trade debt                  $5,942

IBM                           Trade debt                  $2,094

Houghton Mifflin              Trade debt                  $1,186

ADP                           Trade debt                  $1,044

Business Suites Harborplace   Trade debt                    $627

The Baltimore Sun             Advertising                   $487

National Distribution System  Trade debt                    $429

New Zealand Speech-Language   Trade debt                    $300

Map Communications            Trade debt                    $196

Knowles Publishing            Trade debt                    $173

Listing Corp.com              Trade debt                     $47

Interstate Express            Trade debt                     $37


AUSTIN CO: Court Okays Schottenstein Zox as Panel's Bankr. Counsel
------------------------------------------------------------------
The Honorable Pat E. Morgenstern-Clarren of the U.S. Bankruptcy
Court for the Northern District of Ohio in Cleveland gave the
Official Committee of Unsecured Creditors of The Austin Company
and its debtor-affiliates permission to hire Schottenstein Zox &
Dunn Co., LPA, as its bankruptcy counsel.

As previously reported in the Troubled Company Reporter on
Nov. 23, 2005, Schottenstein Zox will:

   a) provide legal advice with respect to the Committee's
      rights, powers and duties;

   b) advise the Committee concerning the administration of the
      Debtors' cases;

   c) assist the Committee in the investigation of the acts,
      conduct, assets, liabilities, and financial condition of
      the Debtors;

   d) prepare necessary responses, objections, applications,
      motions, answers, orders, reports and other legal papers;

   e) represent the Committee in all proceedings in this matter;

   f) participate in the formulation and negotiation of one or
      more plans of reorganization; and

   g) perform all other appropriate legal services that the
      Committee may request.

Schottenstein Zox's professionals and their current hourly billing
rates are:

     Professional                  Rate
     ------------                  ----
     M. Colette Gibbons, Esq.      $375
     Victoria E. Powers, Esq.      $335
     Michael D. Tarullo, Esq.      $300
     Robert M. Stefancin, Esq.     $295
     Hansel H. Rhee, Esq.          $225
     Stephen P. Withee, Esq.       $225
     Tyson A. Crist, Esq.          $195
     Kristen E. Braden, Esq.       $150
     Taylor M. Wesley, Esq.        $150
     Tena M. Thompson              $135
     Legal Assistants              $110

Established in 1966, Schottenstein Zox & Dunn Co., LPA --
http://www.szd.com/-- is one of Ohio's largest and most  
innovative law firms.

The Law Firm can be contacted at:

        Schottenstein Zox & Dunn Co., LPA
        1350 Euclid Avenue, Suite 1400
        Cleveland, Ohio 44115
        Tel: (216) 621-6501
        Fax: (216) 621-6502

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 Lead
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 assets and debts between
$10 million to $50 million.


AUSTIN COMPANY: Has Until Feb. 11 to Make Lease-Related Decisions
-----------------------------------------------------------------
The Honorable Pat E. Morgenstern-Clarren of the U.S. Bankruptcy
Court for the Northern District of Ohio in Cleveland extended The
Austin Company and its debtor-affiliates' time until Feb. 11,
2006, to elect whether to assume, assume and assign or reject
unexpired nonresidential real property leases.

As previously reported in the Troubled Company Reporter on
Dec. 21, 2005, the Debtors have focused their efforts on
resolving issues with sub-contractors and marketing the business
to prospective buyers.  The Debtors expect their time will be
consumed by activities related to the sale proceedings.

As a result, the Debtors have been unable to:

   a) thoroughly evaluate leases,

   b) determine which of the leases will contribute to the
      Debtors' future operations, or

   c) solicit the views of the Official Committee of Unsecured
      Creditors regarding the appropriate treatment of leases.

Accordingly, the extension will allow the Debtors to analyze which
leases need to be assumed or rejected.

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 Lead
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 assets and debts between
$10 million to $50 million.


BEAZER HOMES: Earns $89.9MM of Net Income in First Fiscal Quarter
-----------------------------------------------------------------
Beazer Homes USA, Inc. (NYSE: BZH) reported results for the
quarter ended Dec. 31, 2005.  Highlights for the quarter, compared
to the same period of the prior year, include:

     -- net income of $89.9 million, up 29%;

     -- 3,829 home closings, up 7.1%;

     -- $1.11 billion of total revenue, up 21.3%;

     -- a 12.6% operating income margin, up 40 basis points;  

     -- 3,872 new orders for homes, up 9.2%; and

     -- home sales totaling $1.13 billion, up 11.3%.

                 Record December Quarter

"We are pleased to announce record results for our first quarter
of fiscal 2006," said President and Chief Executive Officer, Ian
J. McCarthy.  "We generated quarterly revenues of $1.11 billion on
home closings of 3,829, up 21% and 7% from the first quarter of
fiscal 2005, respectively, and both representing first quarter
company records.  Furthermore, net earnings and earnings per
diluted share in the December quarter increased 29% and 27%,
respectively, also representing first quarter records."

"These results illustrate the effectiveness of our Profitable
Growth Strategy aimed at achieving greater profitability by
optimizing efficiencies, selectively increasing market
penetration, and leveraging our national brand," McCarthy
continued.  

"Beazer Homes' backlog now stands at a first quarter record level
of 9,276 homes with a sales value of $2.78 billion, up 10% and
18%, respectively, from the backlog homes and sales value a year
ago. We believe this sizeable backlog provides the basis for
strong financial performance in fiscal 2006," added McCarthy.

Closings of 3,829 homes represents a first quarter record and
resulted from year-over-year increases in the Southeast, Central
and Mid-Atlantic regions, offset partially by declines in the
Midwest and West regions.

The growth in new home orders to 3,872 homes for the quarter
reflects increases in almost all markets in the Southeast, Central
and Midwest regions, offset partially by lower new home orders in
both the West and Mid-Atlantic regions.

        Strong Financial Performance in December Quarter

"We achieved record earnings this quarter as a result of our
ongoing focus on the specific initiatives supporting our
Profitable Growth Strategy," said James O'Leary, Executive Vice
President and Chief Financial Officer.  "During the quarter, we
continued our comprehensive review of opportunities to minimize
underperforming investments and provide capital to support our
Profitable Growth Strategy while providing a meaningful return to
our shareholders in the form of our previously-announced share
repurchase program.  We monetized approximately $25 million of
land in the first quarter, while slowing land purchases in those
markets that have provided returns below our expectations.  We
will continue this reallocation process by focusing on those
investments that will optimize our overall returns while returning
capital to our shareholders."

            Execution of Share Repurchase Program

The Board of Directors, as part of the further development of the
company's Profitable Growth Strategy to enhance shareholder value
in the context of the current market environment, authorized the
expansion of the company's existing share repurchase program to a
total of 10 million shares.  

During the first quarter of fiscal 2006, the company repurchased
1,014,600 shares of its common stock for approximately $67.0
million or $66 per share, while maintaining a debt to
capitalization ratio of 47%, within its target range.  In
addition, the company has entered into a plan under Rule 10b5-1 as
part of the share repurchase program.  Subject to market
conditions and other factors, the company expects to make share
repurchases of $200 - $250 million in fiscal 2006. At December 31,
2005, there were approximately 8 million shares remaining under
the current authorization.

                      About Beazer Homes

Headquartered in Atlanta, Beazer Homes USA, Inc. --
http://www.beazer.com/-- is one of the country's ten largest  
single-family homebuilders with operations in Arizona, California,
Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland,
Mississippi, Nevada, New Jersey, New Mexico, New York, North
Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas,
Virginia and West Virginia and also provides mortgage origination
and title services to its homebuyers. Beazer Homes, a Fortune 500
company, is listed on the New York Stock Exchange under the ticker
symbol "BZH."

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 30, 2005,
Fitch Ratings has affirmed the issuer default rating and senior
unsecured debt, including revolving credit facility, rating of
'BB+' for Beazer Homes USA, Inc. (NYSE:BZH).  The rating applies
to:

     * $1.1 billion in outstanding senior notes,   
     * $180 million of senior convertible notes, and
     * $750 million revolving credit agreement.

Fitch said the Rating Outlook is Stable.


BECKMAN COULTER: Moody's Rates Sub. Shelf Registration at (P)Ba1
----------------------------------------------------------------
Moody's Investors Service confirmed the ratings of Beckman
Coulter, concluding a rating review for possible upgrade initiated
on May 25, 2005.  The outlook on Beckman's ratings is stable.

Moody's confirmation of the existing ratings reflects a more
conservative forecast of unadjusted free cash flow in 2006 and
beyond.  Moody's now forecasts that reported or unadjusted free
cash flow (before the expected loss in cash flow due to shift to
operating leases, our standard adjustments to cash flow for
pension and leases and potential dividends) will fall from
approximately $135 million in 2005 to approximately $85-$90
million in 2006, and then rebound to approximately $115-120
million in 2007.

After adjusting for the company's shift to operating leases only,
Moody's anticipates that adjusted free cash flow will decline from
approximately $75 million in 2005 to approximately $25-$30 million
in 2006 before increasing to a range of $115 to $120 million in
2007.

Finally, Moody's anticipates that fully adjusted free cash flow
(includes the expected loss in cash flow due to shift to operating
leases, Moody's standard adjustments and potential dividends) will
decline from $45 million in 2005 to approximately negative $5-$10
million in 2006 before increasing to approximately $80-$90 million
in 2007.  Moody's notes that its cash flow projections exclude the
benefit from the sale of sales-type-lease receivables as it
considers this item to be a financing inflow instead of an
operating inflow.

These ratings were confirmed:

    * $500 Million Universal Shelf Registration (Senior and
      Subordinate); (P)Baa3/(P)Ba1

    * $240 Million 7.45% Senior Notes due 2008; Baa3

    * $235 Million 6.875% Senior Notes due 2011; Baa3

    * $100 Million 7.05% Senior Debentures due 2026; Baa3

Beckman's free cash flow from 2005-2010 is negatively affected by
a shift from sales-type-leases to operating leases, which is a
customer preference in which the company will spend substantially
more to finance the use of equipment by customers, particularly in
2006 through 2010.  As a result, operating cash flow has been
adjusted downward by approximately $60 million in 2005, $100
million higher in 2006, and $80 million higher in 2007.  Moody's
anticipates that the impact on cash flow will be minimized by the
company's expected and continued growth and that the company will
generate approximately $320 million in fully adjusted cash flow
from operations in both 2005 and 2006.

Although the timing and magnitude of cash payments from customers
under the operating leases is similar to those under a retained
sales-type-lease, the revenue recognition differs materially under
the new leases.  Revenue under an operating lease is recognized
ratably over the term of the lease (five years) instead of being
recognized all at once at the time of sale.  More importantly, the
company will have additional capital expenditure needs and the
cost of the equipment is capitalized on the balance sheet as
property, plant and equipment and depreciated on a monthly basis
over a five-year period.  As a result, Moody's estimates that
annual capital spending will increase to a range of $240-$300
million in 2006 and 2007, up from prior spending ($160 and $130
million in 2004 and 2003, respectively).

Moody's notes that the signing of a five year operating lease
includes not only the commitment to pay the cost of the instrument
over a 60 month period but also the purchase of a certain volume
of reagents and other services.  The reagent volume commitment
enables Beckman to generate significant revenue and operating cash
flow while maintaining an acceptable return on its investment for
financing the customer's purchase of instruments.

The termination of sales-type-leases using third party financing,
known as a sold sales-type-lease, will also have a negative effect
on operating cash flow.  When a third party provided the financing
for a sold sales-type-lease, Beckman would recognize revenue and
realize cash flow at the time of the sale of the equipment to the
third party.  The third party would pay Beckman for the full cost
of the equipment and would recoup its costs through monthly
payments made by Beckman's customers.

Moody's notes that in the most recent quarter ended
Sept. 30, 2005, total instrument sales account for slightly under
30% of total sales, while operating leases accounted for 10% of
instruments, with the remainder of instrument sales split evenly
between cash sales and sales-type-leases.  Over the next year,
instrument revenues as a percentage of sales and sales-type
revenue should decline, resulting in a moderation in the rate of
expected revenue growth.

Mitigating these concerns, the ratings reflect a large and growing
market for equipment for diagnostic testing and research, as well
as Beckman's strong position as the number one or number two
player in most of its segments.  In addition, Beckman has a broad
product portfolio, strong and diverse customer base, in addition
to a significant presence in International markets as sales
outside of the United States account for over 50% of the company's
sales.  Beckman's strategy of simplification, automation and
innovation provides tremendous value to the hospital customer by
lowering operating costs, increasing productivity and boosting
revenue.  In particular, new analyzers, automation equipment, and
work cell consolidation have reduced the need for labor, improved
workplace safety while freeing more space in the laboratory.
Beckman has also benefited from its speed, throughput and accuracy
of its testing.

The ratings also consider the stability and predictability of
revenues based on the razor/razor blade model that the company has
used.  The growth of the installed base of equipment drives future
after-market revenue consisting of supplies, service and reagents.
More importantly, since almost all of the instruments can only use
company produced reagents; reagents are a source of recurring
revenue, as every test performed requires the use of reagents.
Sales of reagents along with other supplies increased by over
8.5%, and accounted for almost 70% of the company's revenue for
the nine months ended Sept. 30, 2005.

Moody's expects the company will continue to benefit from the
introduction of new tests and analyzers as the company has a
strong track record for innovation and a robust pipeline of new
products.  In particular, the introduction of new chemistry
analyzers has boosted reagent use by existing customers while
allowing the company to capture new customers from its
competitors.  As noted earlier, Beckman will also benefit from new
automation, work cell consolidation and other clinical diagnostic
instruments.

Offsetting these strengths, the ratings are constrained by the
fact that Beckman must compete against larger and better-
capitalized companies such as:

   * Roche,
   * Abbott Laboratories, and
   * Johnson and Johnson.  

Further, the global Clinical Diagnostics market is highly mature
and is only growing between 3% and 5% a year.  Beckman spent over
$250 million in acquisitions in 2005 to supplement its internal
growth rate.  While these transactions allow the company to access
technology, important intellectual property and new customers,
acquisitions also increase the company's operational and financial
risk.

In addition, the reimbursement environment could prove to be more
challenging in the future as several countries such as Germany,
France, and Japan have implemented cost containment measures to
help restrain the growth in healthcare spending.  In the U.S.,
Medicare has eliminated any pricing increases for laboratory tests
for the next few years.  Further, government deficits have
pressured funding for research for universities, medical centers
and other research organizations.  The combination of these
reimbursement changes and research funding pressures could
negatively affect Beckman's customers, placing pressure on both
pricing and gross margins.  The ratings are also limited by the
company's exposure to foreign currency fluctuations as well as
other inherent risks of operating in the international market.

The ratings outlook could change to positive if the company is
able to generate higher operating cash flow than anticipated while
stabilizing the level of capital spending.  In particular, the
rating could face upward pressure if the company is able to
generate fully adjusted operating cash flow to debt of 35% to 40%
and reduce its unadjusted debt to unadjusted capital to the low
end of its 35% to 50% target on a sustained basis.

The ratings outlook could face downward pressure if the absolute
level of free cash flow does not rebound meaningfully from the
Moody's forecasted level for 2006 or if the level of projected
operating cash flow in the near-term is materially softer, thus
further limiting the company's financial flexibility.  In
particular, a sustained decline in adjusted operating cash flow to
adjusted debt below 25% could cause the ratings outlook to become
negative.

Beckman Coulter, Inc., headquartered in Fullerton, California, is
a leading provider of instrument systems and complementary
products that simplify and automate processes in biomedical
research and clinical laboratories.  For the twelve-month period
ending Sept. 30, 2005, the company had revenues of about $2.6
billion.


BROWNSVILLE GENERAL: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Brownsville General Hospital, Inc.
        125 Simpson Road
        Brownsville, Pennsylvania 15417

Bankruptcy Case No.: 06-20253

Type of Business: The Debtor owns and operates a community
                  hospital.  See http://www.bghlink.com/

Chapter 11 Petition Date: January 24, 2006

Court: Western District of Pennsylvania (Pittsburgh)

Judge: M. Bruce McCullough

Debtor's Counsel: Lawrence C. Bolla, Esq.
                  Quinn Buseck Leemhuis Toohey & Kroto Inc.
                  2222 West Grandview Boulevard
                  Erie, Pennsylvania 16506-4508
                  Tel: (814) 833-2222

Estimated Assets: Less than $50,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Rehab Care Group, Inc.                                 $182,650
P.O. Box 502096
St. Louis MO 63150-2096

Cymetrix                                               $132,000
2701 High Point Oaks Drive
Suite 124
Lewisville, TX 75067

Cananwill, Inc.                  Trade debt            $129,553
1234 Market Street, Suite 340
Philadelphia PA 19107

Donald Croftcheck                                       $70,008
Tax Collector
P.O. Box 795
Republic, PA 15475

Wally Corporation                Trade debt             $69,197
Corporate Office
P.O. Box BB
408 Wally Drive
Uniontown, PA 15401

Horizon Mental Health Management                        $68,649
Accounts Receivable - Finance
P.O. Box 910214
Dallas, TX 75391-0214

Cardinal Health Medical                                 $64,698
P.O. Box 905867
Charlotte, NC 28290

ATC Healthcare Services, Inc.                           $43,942
P.O. Box 31718
Hartford, CT 06150-1718

Bard International Products                             $41,145
P.O. Box 75767
Charlotte, NC 28275

Snyder Brothers, Inc.            Trade debt             $27,186
P.O. Box 1022
1 Glade Park East
Kittanning, PA 16201

Fisher Scientific Co., LLC       Trade debt             $26,673
Acct: 102850-001
13551 Collections Center Drive
Chicago, IL 60693

Nursefinders of Western PA       Trade debt             $19,527
P.O. Box 643222
Pittsburgh, PA 15264-3222

D B & Z, Inc.                    Trade debt             $18,400
Frick Building, Suite 1100
437 Grant Street
Pittsburgh, PA 15219

Western PA Anesthesia            Trade debt             $18,360
4727 Friendship Ave., Suite 240
Pittsburgh, PA 15224

Citicorp Leasing                 Trade debt             $17,803
P.O. Box 7247-7878
Philadelphia, PA 19170-7878

Highmark Casualty Insurance Co.  Trade debt             $17,639
P.O. Box 642512
Pittsburgh, PA 15264-2512

Abbott Laboratories, Inc.        Trade debt             $17,515
P.O. Box 10097
Atlanta, GA 30384-0997

Laboratory Corp. of America                             $16,033
P.O. Box 12140
Burlington, NC 27216-2140

PBGC                                                         $1
Office of General Counsel
1200 K Street, N.W., Suite 310
Washington, DC 20005-4026

Brownsville Property Corp.                                   $1
c/o Ernest DeHaas, Esquire
2 West Main Street, Suite 100
Uniontown, PA 15401


BUCKEYE TECH: Earns $1.9 Million in Quarter Ended Dec. 31, 2005
---------------------------------------------------------------
Buckeye Technologies Inc. (NYSE:BKI) earned $1.9 million after tax
in the quarter ended Dec. 31, 2005.  The Company's results include
$700,000 after tax in restructuring expenses associated with the
closure of the Glueckstadt, Germany cotton linter pulp plant.  The
Glueckstadt manufacturing facility ceased production in December.

During the same quarter of the prior year, the Company earned
$2.9 million after tax, which included $6.6 million after tax in
restructuring and impairment costs and a $4.7 million after tax
gain from the sale of a building and equipment located at Cork,
Ireland.

Net sales in the just completed quarter were $188.3 million, 4%
above the $180.6 million in the same quarter of the prior year.

"Business conditions continued to be very challenging during
October-December," Buckeye Chairman, David B. Ferraro, stated.  
"While we are pleased that we achieved sales growth, continuing
high costs for chemicals, energy, and transportation combined with
startup expenses related to installing market pulp capability at
our Americana, Brazil facility depressed earnings."

At Dec. 31, 2005, total assets were $981,658,000 and total
liabilities were $706,119,000.

Headquartered in Memphis, Tennessee, Buckeye Technologies, Inc. --
http://www.bkitech.com/-- is a leading manufacturer and marketer  
of specialty fibers and nonwoven materials.  The Company currently
operates facilities in the United States, Germany, Canada, and
Brazil.  Its products are sold worldwide to makers of consumer and
industrial goods.

Buckeye Technologies Inc.'s 8-1/2% Senior Notes due 2013 carry
Moody's Investors Service and Standard & Poor's single-B ratings.


CALPINE CORP: Gets Final Approval to Obtain $2 Bil. DIP Financing
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Calpine Corporation final approval to obtain $2 billion
debtor-in-possession credit facility to fund operations during its
chapter 11 restructuring and to retire certain obligations at The
Geysers.  

As previously reported in the Troubled Company Reporter, the
Court authorized the company to borrow up to $500 million of its
$2 billion DIP financing facility for working capital and other
general corporate purposes, and for payment of interest, fees and
expenses related to the DIP Documents.

The Court granted Calpine interim approval to use up to $500
million of the facility during a hearing of first day motions held
Dec. 21, 2005.

The DIP credit facility will be provided to the company by
Deutsche Bank and Credit Suisse as co-lead arrangers.  The
facility is expected to close within the next 30 days and will
consist of:

     --  $1 billion Revolving Credit Facility, priced at LIBOR
         plus 225 basis points;

     --  $350 million First-Priority Term Loan, priced at LIBOR
         plus 225 basis points; and

     --  $650 million Second-Priority Term Loan, priced at LIBOR
         plus 450 basis points.

The DIP facility will remain in place until the earlier of an
effective Plan of Reorganization or Dec. 20, 2007.  The DIP
facility is secured by liens on all of Calpine's unencumbered
assets and junior liens on all of its encumbered assets.

Robert P. May, Calpine's Chief Executive Officer, stated, "We are
very pleased with the Court's approval of our $2 billion DIP
facility.  This financing provides us with ample liquidity to
continue to meet the needs of our customers and the markets we
serve.  It also provides our natural gas suppliers and other
vendors the assurance that they will continue to be paid on a
current basis during our restructuring.  In short, Calpine will
continue to fuel our plants and deliver clean, reliable
electricity to our customers."

Headquartered in San Jose, California, Calpine Corporation --
http://www.calpine.com/-- 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.  The Company filed for chapter 11 protection on Dec. 20,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200).  Richard M. Cieri,
Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert
G. Burns, Esq., Kirkland & Ellis LLP represent the Debtors in
their restructuring efforts.  As of Dec. 19, 2005, the Debtors
listed $26,628,755,663 in total assets and $22,535,577,121 in
total liabilities.


CHARTER COMMS: CCH II to Sell $400 Million of Senior Notes
----------------------------------------------------------
Charter Communications, Inc. (Nasdaq: CHTR) reported that its
subsidiary, CCH II, LLC intends to offer for sale, in two series,
an aggregate of $400 million principal amount of original Senior
Notes due 2013 in a private transaction.  The first series is
expected to have interest payable in cash, or in kind, and will
mature 2013.  The second series is expected to be issued on terms
substantially identical to the issuers' existing $1.6 billion
outstanding 10.250% Senior Notes due 2010.

The net proceeds of this proposed issuance would be used to repay,
but not permanently reduce, the outstanding debt balances under
the existing revolving credit facility of a subsidiary of the
Company.

The Notes will be sold to qualified institutional buyers in
reliance on Rule 144A and outside the United States to non-U.S.
persons in reliance on Regulation S.  The Notes will not be
registered under the Securities Act of 1933, as amended, and,
unless so registered, may not be offered or sold in the United
States except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities
Act and applicable state securities laws.

Charter Communications, Inc. -- http://www.charter.com/-- a
broadband communications company, provides a full range of
advanced broadband services to the home, including cable
television on an advanced digital video programming platform via
Charter Digital(TM), Charter High-Speed(TM) Internet service and
Charter Telephone(TM). Charter Business(TM) provides scalable,
tailored and cost-effective broadband communications solutions to
organizations of all sizes through business-to-business Internet,
data networking, video and music services. Advertising sales and
production services are sold under the Charter Media(R) brand.

At Sept. 30, 2005, Charter's balance sheet showed a $5 billion
stockholders' deficit, compared to a $4.4 billion deficit at
Dec. 31, 2004.


CITIGROUP MORTGAGE: Fitch Affirms Class B-5 Loans' Rating at B
--------------------------------------------------------------
Fitch Ratings affirmed these ratings from Citigroup Mortgage Loan
Trust series 2004-NCM2:

  Series 2004-NCM2:

      * Class A at 'AAA'
      * Class B-1 at 'AA'
      * Class B-2 at 'A'
      * Class B-3 at 'BBB'
      * Class B-4 at 'BB'
      * Class B-5 at 'B'

The mortgage loans consist of conventional, 15- and 30-year fixed-
rate mortgage loans secured by first liens on one- to four-family
residential properties.  As of the December 2005 distribution
date, the transaction is seasoned only 16 months and the pool
factor (current mortgage loan principal outstanding as a
percentage of the initial pool) is approximately 59%.

The affirmations reflect a stable relationship between credit
enhancement and future loss expectations and affect approximately
$323.3 million of outstanding certificates.  All of the credit
enhancement levels have grown to approximately 1.65 times their
original levels, and the deal has had less than 1 basis point of
loss to date.

All of the loans were originated by National City Mortgage, a
subsidiary of National City Corporation.  National City Mortgage
(rated 'RPS2' by Fitch) will also act as the master servicer for
the loans.


CLEAN EARTH: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Clean Earth Environmental Group, LLC
        200 Ladish Road
        Cynthiana, Kentucky 41031

Bankruptcy Case No.: 06-50053

Debtor affiliate filing separate chapter 11 petition:

      Entity                                     Case No.
      ------                                     --------
      Clean Earth Kentucky, LLC                  06-50052

Type of Business: The Debtors manufacture specialized sewer
                  machines, street sweepers, and refuse trucks.
                  See http://www.cleanearthllc.com/

Chapter 11 Petition Date: January 24, 2006

Court: Eastern District of Kentucky (Lexington)

Judge: Joseph M. Scott, Jr.

Debtors' Counsel: Laura Day DelCotto, Esq.
                  Wise DelCotto PLLC
                  219 North Upper Street
                  Lexington, Kentucky 40507
                  Tel: (859) 231-5800
                  Fax: (859) 281-1179

                             Estimated Assets    Estimated Debts
                             ----------------    ---------------
Clean Earth Environmental    $10 Million to      $10 Million to
Group, LLC                   $50 Million         $50 Million

Clean Earth Kentucky, LLC    $10 Million to      $10 Million to
                             $50 Million         $50 Million

The Debtors did not file a list of their 20 largest unsecured
creditors.


COLLINS & AIKMAN: GECC Says Lear Can't Set-Off Debt
---------------------------------------------------
General Electric Capital Corporation asks the U.S. Bankruptcy
Court for the Eastern District of Michigan to deny Lear
Corporation's request to lift the automatic stay so it can assert
its set-off rights on certain Prepetition Receivables.

In the alternative, GECC asks the Court to continue the hearing
on Lear's request so that GECC can conduct discovery regarding
notice of the assignment of the Lear Receivables.

Erin L. Toomey, Esq., at Foley & Lardner LLP, in Detroit,
Michigan, notes that pursuant to Section 9-404 of the Uniform
Commercial Code, once an account debtor receives notice of the
assignment or sale of accounts receivable, the interest of the
assignee or purchaser in the accounts receivable is prior and
superior to any set-off claim alleged by the account debtor.

As reported in the Troubled Company Reporter on Jan. 13, 2006,
GECC is a successor-in-interest to a receivables, related
security, collections and proceeds assignment agreement between
the Debtors and Carcorp, Inc.  The Debtors' estates, through their
100% equity ownership of Carcorp, have a residual interest in the
Prepetition Receivables after GECC has been paid in full.

Lear Corporation is an account debtor and obligor to the Debtors
with respect to certain unpaid Prepetition Receivables.  GECC has
made demand on the Debtors, to collect the Prepetition Receivables
from Lear.

Lear has failed and refused to pay the Prepetition Receivables to
the Debtors or to GECC.  Instead Lear has asked the Bankruptcy
Court for permission to set off a $375,858 prepetition payable
owed by Collins & Aikman Corp. to the amounts it owes the Debtors.

Headquartered in Troy, Michigan, Collins & Aikman Corporation --
http://www.collinsaikman.com/-- is a global leader in cockpit    
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 23; Bankruptcy Creditors' Service, Inc., 215/945-7000)


COLLINS & AIKMAN: Kimsworth Wants to Collect Unpaid Rent and Taxes
------------------------------------------------------------------
Kimsworth, Inc., leased a property at 6950 North Academy Blvd., in
Colorado Springs, Colorado, to Collins & Aikman Corporation.  
Pursuant to the Lease, the Debtors were required to pay rent for
$33,333, and real property taxes.  The Lease was rejected
effective as of June 23, 2005.

Robert K. Siegel, Esq., at Jacob & Weingarten, P.C., in Troy,
Michigan, tells Judge Rhodes that the Debtors have not complied
with their obligations to Kimsworth because they did not pay all
required monthly rent and taxes arising from the Petition Date
until the rejection of the Lease.

Specifically, the Debtors did not pay any of the monthly rent,
which became due on June 1, 2005, Mr. Siegel explains.  The
Debtors' subtenant paid to Kimsworth all but $5,507 of the
monthly rent, Mr. Siegel adds.

Taxes for $32,514 also became due on June 14, 2005, when
Kimsworth sent a bill to the Debtors demanding payment.  The
Debtors, however, refused to pay any of the Taxes.

For this reason, Kimsworth asks the Court to compel the Debtors
to pay administrative expense worth:

   * $5,507 for unpaid monthly rent; and

   * $32,514 for unpaid taxes.

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit  
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 23; Bankruptcy Creditors' Service, Inc., 215/945-7000)


COLLINS & AIKMAN: Panel Supports Denial of IRS & Breitkreuz Plea
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Collins & Aikman
Corporation and its debtor-affiliates supports the Debtors'
request to deny the joint request for adequate protection filed by
the United States Internal Revenue Service and Breitkreuz Molds
and Plastics, Inc.

As reported in the Troubled Company Reporter on Dec. 5, 2005, the
Debtors and Breitkreuz, entered into a prepetition contract for
the production of plastic injection molds for the General Motors
2005 GMX001 Chevrolet Cavalier program.

Pursuant to the Contract, the Debtors were obligated to pay
$469,800 for the Molds production subject to a discount, which the
parties agreed would be $4,500.  In March 2004, the Debtors paid
$145,500 leaving a balance due of $319,800.

The Internal Revenue Service served a levy on the Debtors to
collect the amounts due to Breitkreuz on the account receivable.  
However, the Debtors refused to comply with the legally
enforceable levy.  Instead, on November 1, 2004, the Debtors paid
$168,169 leaving a remaining unpaid balance of $151,631.

By virtue of the levy, the IRS succeeded to the rights of payment
of Breitkreuz and became a fully secured creditor for the
remaining balance.

Breitkreuz and the IRS subsequently asked the U.S. Bankruptcy
Court for the Eastern District of Michigan to:

    -- grant the IRS adequate protection of its secured claim in
       the form of adequate protection payments of $12,925 per
       month payable on the 15th day of each month commencing
       December 15, 2005; and

    -- allow the IRS' administrative expense claim for
       postpetition tooling usage for $90,475.

                      Breitkreuz Responds

In spite of the Debtors' allegation that Breitkreuz has no claim
against them, Willard E. Hawley, Esq., at McDonald Hopkins, in
Bingham Farms, Michigan, asserts that the Debtors have listed a
$174,829 claim by Breitkreuz in their schedules of assets and
liabilities.  The scheduled claim is undisputed, non-contingent
and not subject to set-off.

Mr. Hawley further notes that the Debtors have not identified
their purported $1,140,000 claim against Breitkreuz in their
schedules.

The reality is that no defects were ever identified to any party
from April 2004 when the molds were delivered until the Debtors
made the $168,639 partial payment to the service in October 2004,
Mr. Hawley says.  The Debtors have yet to identify any defects to
Breitkreuz other than in response to the administrative claim and
adequate protection request.

With regards the production part approval process and other
internal compliance issues, Mr. Hawley argues that it is simply
beyond belief that not a scintilla or paperwork identifying
purported defects was created or communicated.

"The Debtors' actions in retaining the tooling for six months,
paying the Internal Revenue Service portions of the money owed in
October, listing Breitkreuz claim as undisputed and failing to
notify Breitkreuz of even a single defect until its response to
the motion, demonstrates a lack of desire or ability to pay, not
defects in the tooling," Mr. Hawley contends.

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit   
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 23; Bankruptcy Creditors' Service, Inc., 215/945-7000)


CORDOVA FUNDING: Moody's Upgrades Sr. Sec. Bonds' Rating to Ba3
---------------------------------------------------------------
Moody's Investors Service upgraded Cordova Funding Corporation's
(CFC) senior secured bonds due 2019 to Ba3 from B3, concluding the
review for upgrade that was initiated on Jan. 17, 2006.  The
rating outlook is stable.

The upgrade is prompted by a change in the counterparty under the
project's power purchase agreement.  El Paso Marketing, L.P.
(EPM), a subsidiary of El Paso Corporation (B3 Corporate Family
Rating), was formerly the counterparty for a power purchase power
agreement (PPA) with the Cordova project.  Constellation Energy
Commodities Group, Inc. (CECG) has legally assumed the obligations
of EPM under the PPA.  CECG's parent Constellation Energy Group,
Inc. (Baa1 senior unsecured) guarantees CECG's obligations under
the PPA.

The project's rating had been limited by the credit profile of EPM
and El Paso Corporation, which was the guarantor of EPM's
obligations under the PPA, given the project's high dependence
upon the guaranteed capacity payment under the PPA.  The principal
constraint on the Ba3 rating is the relatively weak financial
performance of the project due to high natural gas prices and weak
regional wholesale power markets that have caused the facility to
be dispatched at a far lower rate than was originally forecast.

The stable outlook reflects Moody's view that the Ba3 rating is
not likely to be revised in the near term and assumes the project
will be able to maintain debt service coverage ratios in excess of
1.1 times over the next few years, due to the minimum guaranteed
capacity payments under the contract with CECG, and will not need
to utilize the debt service reserve.  The rating could be revised
upward if the project is able to produce debt service coverage
ratios above 1.2 times on a sustainable basis and if there are
signs of improvement in the regional wholesale power market.

Conversely, the rating or outlook could be adversely impacted if
there is an operating disruption that could cause capacity
payments to fall or if Constellation's credit quality were to
deteriorate substantially.

Cordova Funding Corporation is the financing subsidiary of Cordova
Energy Company LLC, which owns a 540 MW gas fired generation
facility located in Rock Island County, Illinois.  It is
indirectly wholly-owned by MidAmerican Energy Holdings Company.


CORNELL TRADING: Can Use Lender's Cash Collateral on Interim Basis
------------------------------------------------------------------
The Hon. Joan N. Feeney of the U.S. Bankruptcy Court for the
District of Massachusetts gave Cornell Trading, Inc., permission
on an interim basis, to use up to $7.5 million of KeyBank, N.A.'s
cash collateral.

The Debtor needs access to KeyBank's cash collateral to pay
necessary operating expenses, fund its payroll in order to satisfy
its employee obligations, pay vendors and suppliers, pay landlords
and meet other on-going business obligations.

To adequately protect the lender's interest, KeyBank is granted
continuing, valid, binding, enforceable and automatically
perfected postpetition replacement security interests, mortgages
and other liens, on all property of the Debtor's estate.

A full-text copy of the proposed 4-week budget through Jan. 27 is
available for free at http://ResearchArchives.com/t/s?4a2

The Court will convene a hearing at 1:00 p.m., on Feb. 2, 2006, to
consider the Debtors' request to use the cash collateral on a
final basis.

Headquartered in Williston, Vermont, Cornell Trading, Inc. --
http://www.aprilcornell.com/-- sells women's and  
children'sapparel including dresses, skirts, blouses, and
sleepwear.  Cornell also offers books and housewares like table
linens, placemats and napkins, bedding, and dolls and stuffed
animals.  The Company filed for chapter 11 protection on January
4, 2006 (Bankr. D. Mass. Case No. 06-10017).  Christopher J.
Panos, Esq., at Craig & Macauley, P.C., represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed estimated debts and assets between
$10 million to $50 million.


CORNELL TRADING: Hires Craig & Macauley as Bankruptcy Counsel
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts gave
Cornell Trading, Inc., authority to employ Christopher J. Panos,
Esq., and the law firm of Craig & Macauley P.C., as its counsel.

Craig and Macauley will:

   a) provide the Debtor with legal advice with respect to its
      rights, duties and powers;

   b) assist the Debtor in taking all necessary action to protect
      and preserve its estate and any other matters relevant to
      this case;

   c) assist the Debtor in investigating and pursuing avoidance
      actions and other causes of action or claims the Debtor may
      have against certain parties;

   d) prepare pleadings, applications and objections as may be
      necessary in furtherance of the Debtor's interests and
      objectives;

   e) consult with any appointed official committee, its counsel,
      other professionals retained in this case and the U.S.
      Trustee concerning the administration of the estate;

   f) represent the Debtor in hearings and other judicial
      proceedings; and

   g) perform other legal services as may be required and are
      deemed to be in the interest of the Debtor in accordance
      with those powers and duties set forth in Bankruptcy Code.

Mr. Panos discloses the Firm's professionals bill:

    Professional                   Designation     Hourly Rate
    ------------                   -----------     -----------
    Christopher J. Panos, Esq.     Member             $400
    Brendan C. Recupero, Esq.      Associate          $275

          Professional                 Hourly Rate
          ------------                 -----------
          Shareholders                 $375 - $500
          Of Counsel                   $325 - $390
          Associates                   $175 - $300
          Paralegals                   $110 - $150

Craig and Macauley assures the Court that the Firm is
disinterested as that term is defined in Section 101(14) of the
U.S. Bankruptcy Code.

Headquartered in Williston, Vermont, Cornell Trading, Inc. --
http://www.aprilcornell.com/-- sells women's and  
children'sapparel including dresses, skirts, blouses, and
sleepwear.  Cornell also offers books and housewares like table
linens, placemats and napkins, bedding, and dolls and stuffed
animals.  The Company filed for chapter 11 protection on January
4, 2006 (Bankr. D. Mass. Case No. 06-10017).  Christopher J.
Panos, Esq., at Craig & Macauley, P.C., represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed estimated debts and assets between
$10 million to $50 million.


COUNTRYWIDE HOME: Fitch Lifts Ratings on Classes B3 & B4 Certs.
---------------------------------------------------------------
Fitch took actions on these CWMBS (Countrywide Home Loans Inc.)
residential mortgage-backed certificates:

  Series 2003-2:

      * Class A affirmed at 'AAA'
      * Class M upgraded to 'AAA' from 'AA+'
      * Class B1 upgraded to 'AAA' from 'A+'
      * Class B2 upgraded to 'AA' from 'BBB+'
      * Class B3 upgraded to 'A' from 'BB'
      * Class B4 upgraded to 'BBB' from 'B'

The collateral consists of conventional, fully amortizing, 30-year
fixed-rate mortgage loans, secured by first liens on one- to four-
family residential properties.  At issuance, the weighted-average
original loan-to-value ratio was 69.46%.  The three states that
represent the largest portion of mortgage loans are:

   * California (63.97%),
   * New Jersey (3.44%), and
   * New York (2.64%).

All of the mortgage loans are master serviced by Countrywide Home
Loans Servicing LP, rated 'RMS2+' by Fitch.

The affirmations reflect a stable relationship between credit
enhancement and future loss expectations and affect approximately
$126.71 million of outstanding certificates.  The upgrades,
affecting approximately $12.90 million of outstanding
certificates, are being taken as a result of low delinquencies and
cumulative losses (0.01% of original collateral balance), as well
as increased credit support levels.

As of the December 2005 distribution date, the credit enhancement
for the upgraded classes increased by at least three times
original credit enhancement levels.  The transaction has a pool
factor (current mortgage loan principal outstanding as a
percentage of the initial pool) of 28% and is 35 months seasoned.


DELTA AIR: Balks at Retiree's Request to Bar Use of Trust Funds
---------------------------------------------------------------
As previously reported in the Troubled Company Reporter, The Delta
Air Lines Section 1114 Committee representing non-pilot retirees
of Delta Air Lines, Inc. asked the U.S. Bankruptcy Court for the
Southern District of New York to:

   (1) determine that Section 1114(a) of the Bankruptcy Code
       applies to the Trust so that Delta is precluded from
       amending the Trust or the Plan without first complying
       with the requirements of Section 1114 if the amendment
       would in any way impact the payment or prospect for
       payment of any "benefits in the event of sickness,
       accident, disability, or death";

   (2) direct, with respect to all unauthorized disbursements
       going forward, Delta to immediately cease payment from
       the Trust of any obligations for severance, furloughs, or
       any other unauthorized amounts, and immediately repay the
       Trust any unauthorized amounts disbursed from the Trust
       since September 13, 2005, together with 8% annual simple
       interest on the diverted funds;

   (3) direct Delta to provide the Retiree Committee:

          -- with information in connection with severance and
             other payments made from the Trust, and to identify
             former Delta officers and directors who were members
             of the Administrative Committee and BFIC from
             September 11, 2001, to the present; and

          -- information regarding:

             (a) accounting of the funds removed from the Trust
                  since September 13, 2005;

             (b) calculation of the interest to be paid on the
                 diverted funds; and

             (c) accounting of all funds removed from the Trust
                 since September 11, 2001; and

   (4) authorize the Retiree Committee, to the extent Delta does
       not immediately repay to the Trust all unauthorized
       disbursements made from the Trust, to bring an adversary
       proceeding to determine whether Delta's assets are subject
       to a constructive trust or resulting trust, for the
       benefit of the Trust and in the amount equal to the total
       disbursements from the Trust for severance claims which
       arose or first became payable at any time after March 1,
       2002, and all other unauthorized payments, together with
       quarterly compounding interest.

                        Debtors Object

The request of the Delta Air Lines Section 1114 Committee, on
behalf of non-pilot retirees, is based on erroneous factual
allegations and legal theories of the Retiree Committee's own
invention, Thomas P. Ogden, Esq., at Davis Polk & Wardwell, in
New York, tells the Court.

The benefit with which the Retiree Committee is primarily
concerned is a monthly survivor benefit payable upon the death of
an active or retired employee, Mr. Ogden notes.  This monthly
survivor benefit is payable from the Delta Family-Care Disability
and Survivorship Plan, an employee welfare benefit plan.

Delta Air Lines, Inc., maintains that it has not made, nor does
it have any current intention to make, any changes to the monthly
survivor benefit provided under the D&S Plan.  "Because there is
no change made or proposed to the D&S Plan's obligation to pay
the monthly survivor benefit, Section 1114 [of the Bankruptcy
Code] is inapplicable," Mr. Ogden argues.

The Retiree Committee also asserts that because there is a
separate trust -- the Disability and Survivorship Trust, restated
and amended as of July 1, 2001 -- that the D&S Plan uses to fund
its benefit obligations, and because this Trust is allegedly
being improperly depleted, then Section 1114 applies to the
Trust.

In response, Mr. Ogden points out that the Retiree Committee's
allegation ignores the inconvenient fact that in Delta's case,
even if the Trust had no assets, the D&S Plan would remain
obligated to pay the monthly survivor benefit as well as all the
other benefits it provides.

The Retiree Committee's request, Mr. Ogden says, blurs the
difference between the D&S Plan and the Trust.  The D&S Plan
is an employee welfare benefit plan that is a legal entity in
its own right and creates an obligation for the Debtors to pay
the benefits provided in the plan document.  The Trust promises
no benefits of any kind.  Rather, the benefits are normally
established under the various plans, which use the trust simply
as a payment source from which to provide benefits.  There are no
statutory or contractual funding obligations to which the Trust
is subject.

Moreover, the Debtors deny the allegations that the payment of
100% certified time benefits from the Trust began because of an
amendment to the D&S Plan signed only days before Delta's
bankruptcy filing.  

Mr. Ogden explains that, while Delta ministerially signed a
document immediately before the Petition Date that amended and
restated the D&S Plan, that document did not cause a change of
any kind in the benefits paid from the D&S Plan to active
employees or to retired employees.  The changes in benefits
were implemented on January 1, 2004, and the D&S Plan has been
administered consistent with those changes since that time.
D&S Plan benefits have been paid on an unchanged basis since
January 1, 2004, in conformity with documents distributed to
employees prior to that date, all in conformity with the
requirements of the ERISA.

The Retiree Committee's request for authorization to initiate
litigation against Delta is unsupported by the factual
allegations of the Retiree Committee and applicable law, Mr.
Ogden further asserts.

Delta assures the Court that it will continue to provide the
Retiree Committee the relevant information that its requests in a
timely and appropriate fashion.

            Creditors Committee Wants Ruling Deferred

The Official Committee of Unsecured Creditors asserts that:

    * the payments made by the Trust do not appear to be
      prohibited under the Plan or the Trust Agreement and that,
      to the extent they were not authorized, the documents may
      be retroactively amendable to cure any problems with the
      payments; and

    * Section 1114 does not apply to the Retiree Committee's
      allegations.

The Creditors Committee, however, tells the Court that it needs
time to fully investigate and analyze the issues raised.

The Creditors Committee has earlier requested that the Retiree
Committee adjourn the Motion and that the Debtors cease making
severance payments from the Trust to secure the adjournment from
the Retiree Committee.

While the Debtors made a proposal to the Retiree Committee to
prevent the dissipation of the funds in the Trust until the Court
renders a decision, the Debtors have not agreed to cease making
severance payments from the Trust and the Retiree Committee has
not agreed to an adjournment.

Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer Feld & LLP,
in New York, notes that, as of December 13, 2005, neither the
Creditors Committee, the Debtors, nor the Retiree Committee has a
complete accounting of the payments made from the Trust during
the period under dispute, and the Creditors Committee does not
know who received payments from the Trust, what benefits those
payments were intended to provide, or under which plans or
programs the obligation to pay those benefits arose, all of which
are critical issues of fact.

The Creditors Committee, according to Ms. Beckerman, has
requested extensive information and documents from the Debtors
concerning the Plan, the Trust and the disbursements.  The
Debtors are working to collect the information and documents
requested as rapidly as possible, but have not provided the
Creditors Committee with all of the information requested.

Once the Creditors Committee receives the information requested,
the Committee and its advisors will need time to review and
analyze that information and the law in conjunction therewith.  
In addition, a review of the information will possibly generate
new questions and additional requests for information.

The Creditors Committee recognizes serious allegations made by
the Retiree Committee involving tens of millions of dollars in
payments made under a complex Plan and Trust that implicates
difficult legal issues under ERISA, the Internal Revenue Code and
the Bankruptcy Code.

Thus, the Creditors Committee asks the Court to adjourn the
hearing on the Retiree Committee's request.  The Committee also
wants the Court to establish appropriate safeguards to prevent
the dissipation of the funds in the Trust until a decision is
rendered on the Retiree Committee's request.

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. 18;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DELTA AIR: Gets Court Nod to Enter Into Derivative Contracts
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Delta Air Lines Inc. and its debtor-affiliates to
continue performance under existing Derivative Contracts and to
enter into, roll over, adjust, modify, and settle the Derivative
Contracts.

With respect to any Fuel Hedging Contract, the Court applied these
restrictions:

   (i) The Debtors will not enter into any new Fuel Hedging
       Contract if, for any given month covered by the Fuel
       Hedging Contract, after giving effect thereto, the
       Aggregate quantity of fuel for the month covered by all
       existing Fuel Hedging Contracts would exceed 30% of the
       monthly average of the Debtors' Estimated Fuel Consumption
       for the months covered by the Fuel Hedging Contract,
       unless, in the instance, they have obtained the prior
       approval of the Official Committee of Unsecured Creditors
       or the Court;

  (ii) Promptly after entering into any new Fuel Hedging
       Contract, the Debtors will give notice describing the
       transaction in reasonable detail to one of the individuals
       from a financial advisor to the Creditors' Committee as
       have been from time to time identified to the Debtors for
       this purpose; and

(iii) As often as reasonably requested -- but in no event more
       frequently than weekly -- the Debtors will participate in
       a conference call, at a mutually convenient time, with the
       advisors to the Creditors Committee with the purpose of
       reviewing the Debtors' current strategy in regard to Fuel
       Hedging Contracts and the current status of its program
       implementing that strategy.

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. 17;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DLJ MORTGAGE: Fitch Holds DD Ratings on Five Certificate Classes
----------------------------------------------------------------
Fitch Ratings took these rating actions on the DLJ Mortgage
Acceptance Corporation residential mortgage pass-through
certificates:

Series 1993-QE5:

    * Class A2 affirmed at 'AAA'
    * Class A3 affirmed at 'BBB-'
    * Class B1 remains at 'DD'

Series 1993-QE11:

    * Class A1, S affirmed at 'AAA'
    * Class A2 affirmed at 'B'
    * Class B1 remains at 'DD'

Series 1995-Q8:

    * Class M affirmed at 'AA'
    * Class B1 remains at 'DD'

Series 1995-Q10:

    * Class B1 upgraded to 'AA' from 'A+'
    * Class B2 remains at 'C'

Series 1995-Q11:

    * Class M affirmed at 'AA'
    * Class B1 remains at 'DD'

Series 1996-Q2:

    * Class A1, SA affirmed at 'AAA'
    * Class A2 affirmed at 'AA'
    * Class B1 remains at 'D'

Series 1996-Q4:

    * Class B1 affirmed at 'AA'
    * Class B2 remains at 'D'

Series 1996-Q6:

    * Class A1, SA affirmed at 'AAA'
    * Class A2 upgraded to 'AAA' from 'AA'
    * Class B1 affirmed at 'A+'
    * Class B2 remains at 'DD'

Series 1996-QJ:

    * Class B1 affirmed at 'A+'
    * Class B2 downgraded to 'BB+' from 'BBB+'
    * Class B3 remains at 'D'

The underlying collateral for the mortgages listed above consist
of 30 year adjustable-rate mortgages extended to subprime
borrowers.  As of the December 2005 distribution date, the
transactions are seasoned from a range of 112 to 153 months and
the pool factors (current mortgage loan principal outstanding as a
percentage of the initial pool) range from approximately 1%
(series 1993-QE5 & 1995-6) to 5% (series 1995-Q11 & 1996-QJ).

The affirmations reflect a satisfactory relationship between
credit enhancement (CE) and future loss expectations and affect
approximately $13.6 million of outstanding certificates.  The
upgrade reflects an improvement in the relationship between CE and
future loss expectations and affects approximately $1.3 million of
outstanding certificates.  The downgrades, affecting $696,158 of
the outstanding certificates, reflect the deterioration of CE
relative to consistent or rising monthly losses.

Class B1 from series 1995-Q10 was upgraded to 'AA' from 'A+'
because it is currently the most senior class and benefits from a
CE level of 39.58%, more the eight times the CE level at the
closing date.  Class A2 from series 1996-Q6 CE level has increased
more then nine times since closing and is currently at 75.46%,
therefore was upgraded to 'AAA' from 'AA'.

The downgrade on series 1996-QJ, class B2 affects $696,158 of
total certificates.  As of the December 2005 distribution, the
pool has incurred losses of 10.07% of the initial pool balance.
The class supporting the downgraded B2 class, the B3 certificate,
has only $193,162 left in outstanding certificates representing
12.49% of all outstanding certificates.


DMX MUSIC: Wants Plan-Filing Period Stretched to March 17
---------------------------------------------------------
Maxide Acquisition, Inc., dba DMX MUSIC, Inc., and its
debtor-affiliates ask the U.S. Bankruptcy Court for the District
of Delaware to extend the time within which they have the
exclusive right to file a chapter 11 plan to March 17, 2006.  
The Debtors also want the Court to extend the period within which
they have the exclusive right to solicit acceptances for a chapter
11 plan to May 16, 2006.

Curtis A. Hehn, Esq., at Pachulski, Stang Ziehl, Young, Jones &
Weintraub, P.C., in Wilmington, Delaware, argues that the Debtors
need more time to determine how best to allocate the proceeds of
the sale of substantially all of its assets, and to successfully
move for the disallowance of some administrative and priority
claims.  

The Debtors sold all of their assets to THP Capstar, Inc., on
June 3, 2005, aided by the Court-sanctioned auction.  The Court,
however, did not indicate in its order how the proceeds should be
distributed.  The Official Committee of Unsecured Creditors and
the Debtors are negotiating and tentatively resolving differences
on the matter.

Headquartered in Los Angeles, California, Maxide Acquisition,
Inc., dba DMX MUSIC, Inc. -- http://www.dmxmusic.com/-- is    
majority-owned by Liberty Digital, a subsidiary of Liberty Media
Corporation, with operations in more than 100 countries.  DMX
MUSIC distributes its music and visual services worldwide to more
than 11 million homes, 180,000 businesses, and 30 airlines with a
worldwide daily listening audience of more than 100 million
people.  The Company and its debtor-affiliates filed for chapter
11 protection on Feb. 14, 2005 (Bankr. D. Del. Case No. 05-10431).  
The case is jointly administered with Maxide Acquisition, Inc.
(Bankr. D. Del. Case No. 05-10429).  Curtis A. Hehn, Esq., and
Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones
& Weintraub P.C., represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they estimated more than $100 million in assets and
debts.


DORAL FINANCIAL: Has Until April 24 to File Financial Statements
----------------------------------------------------------------
Doral Financial Corporation (NYSE: DRL) and the trustee under the
indenture relating to its $625,000,000 Floating Rate Senior Notes
due 2007 have executed a supplemental indenture in connection with
the Company's consent solicitation relating to the Floating Rate
Notes.  The Floating Rate Notes consent solicitation expired at
5:00 p.m., New York City time, on Jan. 23, 2006.

In accordance with the supplemental indenture, the Company will
have until April 24, 2006 to file with the trustee its quarterly
reports on Form 10-Q for the quarterly periods ended March 31,
2005, June 30, 2005, and Sept. 30, 2005 and until May 24, 2006 to
file its annual report on Form 10-K for the fiscal year ended
Dec. 31, 2005 before the failure to file those reports becomes a
default under the Indenture that would allow holders to deliver a
notice of default to the trustee or the Company.  After receipt of
any notice of default, the Company would have a 90-day grace
period to cure the default before it became an event of default
under the Indenture.

In the Floating Rate Notes consent solicitation, the Company
sought and obtained the consent of holders to the amendments to
the Indenture, which amendments are effected by the supplemental
indenture.  The Company also sought and obtained waivers of
certain defaults that has occurred and that may occur under the
Indenture.  The amendments and waivers became effective upon
execution of the supplemental indenture on Jan. 24, 2006 at
approximately 1:00 p.m., New York City time.

In accordance with the terms of the Floating Rate Notes consent
solicitation, the Company will pay a consent payment of $2.50 per
$1,000 principal amount of Floating Rate Notes to holders thereof
that consented prior to the Expiration Time.

Doral Financial Corporation -- http://www.doralfinancial.com/-- a
financial holding company, is the largest residential mortgage
lender in Puerto Rico, and the parent company of Doral Bank, a
Puerto Rico based commercial bank, Doral Securities, a Puerto Rico
based investment banking and institutional brokerage firm, Doral
Insurance Agency, Inc. and Doral Bank FSB, a federal savings bank
based in New York City.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 1, 2005,
Moody's Investors Service downgraded to Ba3 from Ba1 the senior
debt of Doral Financial Corporation.  The ratings have been
downgraded a number of times since Moody's initial review process
began in April 2005.  According to Moody's, a number of negative
developments have occurred since the most recent downgrade, which
was on Sept. 6, 2005.

A partial list of ratings that have been downgraded:

    * Senior debt to Ba3 from Ba1 and
    * Subordinated debt to B1 from Ba2.


DRS TECHNOLOGIES: Prices Offering of $600 Million Senior Notes
--------------------------------------------------------------
DRS Technologies, Inc. (NYSE: DRS) reported the terms of an
offering of $350 million aggregate principal amount of its 6-5/8%
senior notes due 2016 and an offering of $250 million aggregate
principal amount of its 7-5/8% senior subordinated notes due 2018.  
The transaction is expected to close on Jan. 31, 2006.

The notes are being offered pursuant to an effective shelf
registration statement previously filed with the Securities and
Exchange Commission.

Together with a portion of its available cash and borrowings under
an amended and restated credit facility, DRS intends to use the
net proceeds from the offering:

     * to finance its previously announced acquisition of
       Engineered Support Systems, Inc. (NASDAQ: EASI),

     * to repay certain of Engineered Support Systems' outstanding
       indebtedness, and

     * to pay related fees and expenses.

Closing of the offering is conditioned upon the closing of the
acquisition by DRS of all of the outstanding stock of Engineered
Support Systems.

Bear, Stearns & Co. Inc. is acting as sole book-running manager,
and Wachovia Capital Markets, LLC is acting as joint lead manager.

Headquartered in Parsippany, New Jersey, DRS Technologies --
http://www.drs.com/-- provides leading edge products and services  
to defense, government intelligence and commercial customers.  
Focused on defense technology, the Company develops and
manufactures a broad range of mission critical systems.  The
company employs 6,000 people worldwide.

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 24, 2006,
Fitch Ratings has initiated these ratings for DRS Technologies,
Inc.:

    * Issuer Default Rating 'B+';

    * proposed senior secured credit facility 'BB+'/Recovery
      Rating '1';

    * proposed senior notes 'BB/RR2'; and

    * proposed and existing senior subordinated notes 'B-/RR6'.

Rating Outlook Stable.


ECHOSTAR COMMS: Offering $1B of Common Shares to Buy Back Notes
---------------------------------------------------------------
EchoStar Communications Corporation's (NASDAQ: DISH) subsidiary,
EchoStar DBS Corporation, is offering approximately $1 billion
aggregate principal amount of Class A common stock, in accordance
with Securities and Exchange Commission Rule 144A.  The proceeds
of the offering are intended to be used to redeem EchoStar DBS's
outstanding 9-1/8% Senior Notes due 2009 as well as for general
corporate purposes.

The Company will be redeem its outstanding 9-1/8% Senior Notes due
2009 at a price of 104.563%.  A total of $462.1 million plus
accrued and unpaid interest would be required to repurchase.  

The notes will be redeemed effective Feb. 17, 2006.  Interest on
the notes will be paid through the Feb. 17, 2006, redemption date.
The trustee for the notes is the U.S. Bank National Association,
telephone 1-800-934-6802.

As of September 30, 2005, the Company's equity deficit narrowed to
$785,175,000 from a $2,078,212,000 deficit at December 31, 2004.

EchoStar Communications Corporation -- http://www.echostar.com/--   
serves more than 11.71 million satellite TV customers through its
DISH Network(TM), and is a leading U.S. provider of advanced
digital television services.  DISH Network's services include
hundreds of video and audio channels, Interactive TV, HDTV, sports
and international programming, together with professional
installation and 24-hour customer service.  EchoStar has been a
leader for 25 years in satellite TV equipment sales and support
worldwide. EchoStar is included in the Nasdaq-100 Index (NDX) and
is a Fortune 500 company.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 23, 2006,
Moody's Investors Service affirmed all ratings for EchoStar
Communications Corporation and subsidiary EchoStar DBS
Corporation following the company's announcement of a proposed
$1 billion senior unsecured debt issuance (not rated by Moody's)
at EDBS.  

The outlook remains stable.

Moody's took these actions:

  EchoStar Communications Corporation:

     * Corporate Family Rating -- Ba3 (affirmed)
     * Convertible Subordinated Notes -- B2 (affirmed)
     * Speculative Grade Liquidity Rating -- SGL-1 (affirmed)

  EchoStar DBS Corporation:

     * Senior Unsecured Notes due 2014 -- Ba3 (affirmed)

As reported in the Troubled Company Reporter on Jan. 23, 2006,
Fitch Ratings affirmed Echostar Communications Corporation's
'BB-' Issuer Default Rating, and affirmed the 'B' rating on
the convertible subordinated notes.  Fitch also affirms the
'BB-' rating on the senior unsecured notes issued by Echostar's
wholly owned subsidiary Echostar DBS Corporation.

In addition, Fitch has assigned a 'BB-' rating to the proposed
offering of $1 billion in senior notes in accordance with SEC rule
144A.  Approximately $5.9 billion of debt as of the end of the
third quarter is affected by Fitch's action.  Fitch said the
rating outlook is stable.


FLYI INC: Sells Westchester Terminal & Ramp Allocations to AirTran
------------------------------------------------------------------
FLYi, Inc., and its debtor-affiliates sought and obtained
permission from the U.S. Bankruptcy Court for the District of
Delaware to sell terminal and ramp allocations at Westchester
County Airport to AirTran Airways, Inc., for $175,000.

Pursuant to the Order Establishing Procedures for Miscellaneous
Asset Sales, the Debtors informed the U.S. Trustee; Air Canada, a
lienholder; and counsel to the Official Committee of Unsecured
Creditors of their proposed sale transaction.

Brendan Linehan Shannon, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, informs the Court that the
conditions to the sale are:

    (a) instrument of conveyance;
    (b) consents from Westchester County authorities;
    (c) the allocations have not been terminated or expired; and
    (d) a court order approving the transaction.

Mr. Shannon notes that Air Canada is currently using one of the
allocations.

Pursuant to Sections 105(a) and 363(f) of the Bankruptcy Code,
Judge Walrath directs, the sale will be free and clear of all
liens, claims, encumbrances and other interests.  Air Canada will
be given 30 days' notice prior to the termination of its rights to
use the Westchester allocation.

Headquartered in Dulles, Virginia, FLYi, Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  As of Sept. 30, 2005, the Debtors listed
assets totaling $378,500,000 and debts totaling $455,400,000.
(FLYi Bankruptcy News, Issue No. 10; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


FLYI INC: Goodrich Wants Carrier to Decide on Maintenance Contract
------------------------------------------------------------------
Goodrich Corporation is a counterparty to a wheel and brake
servicing contract, effective as of May 5, 2004, with
Independence Air, Inc.

Pursuant to the W&B Contract, Goodrich agreed to provide repair
services and related equipment with respect to the main wheels,
nose wheels and brakes for Independence's fleet of up to a
maximum of 25 firm and 50 option Airbus A-318, A-319 and A-320
aircraft.

The 10-year W&B Contract will expire on May 5, 2014.

Under the Agreement, Goodrich charges FLYi, Inc., and its debtor-
affiliates a flat fee per Aircraft landing, which is calculated in
accordance with a formula within the Agreement.  The Agreement
provides incentives to the Debtors in the form of equipment,
discounts and rebates.

As an incentive, Goodrich agreed to forgo any CPAL fees for the
18-month period commencing with the in-service date of the first
Aircraft added to the Debtors' fleet.  The Debtors will begin
making the CPAL payments in March 2006.

Thus, Goodrich's profitability under the W&B Contract is directly
related to the number of aircraft in Independence's fleet and
aircraft landings.

Michelle McMahon, Esq., at Heller Ehrman LLP, in New York,
relates that Goodrich only agreed to provide the incentives to
Independence with the expectation that it would recoup its costs
over the entire 10 year-term of the W&B Contract and through the
increase in the number aircraft landings.

Due to, among other things, the high cost of providing the
Incentives, Goodrich did not anticipate breaking even under the
W&B Contract until, at the earliest, the sixth year that the
contract is in effect, or the year 2010, Ms. McMahon informs the
Court.

With the Debtors' intention to sell their business as well as to
assume and assign or reject certain executory contracts and
unexpired leases, Ms. McMahon believes that Goodrich will never
receive any compensation on account of the repair services and
related equipment that it has provided, and continues to provide,
to Independence.

Goodrich asks the Hon. Mary F. Walrath of the U.S. Bankruptcy
Court for the District of Delaware to:

    (a) compel the Debtors to assume or reject the W&B Contract;
        and

    (b) require the Debtors to make interim adequate protection
        payments.

                         Debtors Object

Brendan Linehan Shannon, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, contends that Goodrich
failed to demonstrate any justification to force the Debtors to
assume or reject the Agreement prior to plan confirmation.
Goodrich failed to articulate any potential harm it will suffer
if the Debtors do not make an immediate decision to assume or
reject the Agreement.  Moreover, Goodrich's interests do not
outweigh the Debtors' legitimate need to focus attention and
resources on maximizing value to the Debtors' estates in the
aggregate.  More importantly, Goodrich makes no legitimate
attempt in its request to balance the relative harm.  Rather,
Goodrich simply assumes that the Debtors have "effectively" made
a decision regarding assumption or rejection of the Agreement.

Conversely, the Debtors will suffer significant harm if
Goodrich's requests are granted, Mr. Shannon points out.  "The
Debtors are less than two months into a chapter 11 process that
from the onset involved a resource and time consuming process to
locate an investor or purchaser for substantially all of the
Debtors' assets."

Specifically, the Debtors ask the Court to deny Goodrich's
request for adequate protection on these grounds:

    -- Goodrich fails to provide evidence of any diminution in
       value; and

    -- Goodrich is attempting to void an incentive provided to the
       Debtors under the Agreement.

Headquartered in Dulles, Virginia, FLYi, Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  As of Sept. 30, 2005, the Debtors listed
assets totaling $378,500,000 and debts totaling $455,400,000.
(FLYi Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


FLYI INC: Aviall Services Wants to Set-Off Prepetition Claims
-------------------------------------------------------------
Aviall Services, Inc., supplied de-icer boots and other items to
FLYi, Inc., and its debtor-affiliates prepetition.

The Debtors used de-icer boots on their Donnier aircraft.  The
Debtors subsequently discontinued their Donnier aircraft and
began using Airbus aircraft.  Hence, Aviall's de-icer boots in
stock especially for the Debtors were no longer useable on Airbus
aircraft.

Aviall repeatedly and aggressively attempted to sell the de-icer
boots to other parties but to no avail.  Aviall couldn't also
return the de-icer boots to the manufacturer.

As a result, Aviall asserts that it is entitled to a prepetition
claim for $500,000 for the de-icer boots.  Aviall also asserts a
claim for $80,858 for other prepetition goods sold to the
Debtors.

Neil J. Orleans, Esq., at Goins, Underkofler, Crawford & Langdon
LLP, in Dallas, Texas, notes that Aviall gave the Debtors
prepetition credits amounting to $342,307.

Mr. Orleans further relates that on October 7, 2005, Aviall and
the Debtors entered into an agreement for the purchase of life
vests.  In connection with the purchase order, the Debtors sought
to use some of the credits to offset the entire amount of the
purchase price of the life vests.

As of the Petition Date, the life vests had not been shipped to
the Debtors nor had the Debtors been invoiced.

Mr. Orleans points out that neither of the parties was aware of
Aviall's claim for the $500,000 offset for the de-icer boots at
the time the parties entered into the agreement for the purchase
of life vests.  Thus, there was a mutual mistake with regard to
the provisional agreement of the parties to utilize the
prepetition credits to offset the entire amount of the purchase
price of the life vests.

On November 17, 2005, Aviall and the Debtors entered into an
escrow agreement, under the terms of which they deposited $74,977
with an escrow agent to be held in trust subject to a Court order
regarding the availability, if any, to the Debtors for use of the
prepetition credit amount.

By this motion, Aviall asks the U.S. Bankruptcy Court for the
District of Delaware:

    (a) to permit it to offset the $580,858 that the Debtors owed
        to Aviall against the $342,307 credit it extended to the
        Debtors;

    (b) not to allow the Debtors to set off the $74,978 against
        the prepetition credit; and

    (c) to authorize the escrow agent to remit $74,978 to Aviall.

Headquartered in Dulles, Virginia, FLYi, Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  As of Sept. 30, 2005, the Debtors listed
assets totaling $378,500,000 and debts totaling $455,400,000.
(FLYi Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


FORD MOTOR: Restructuring Plan Calls For Job Cuts & Plant Closures
------------------------------------------------------------------
Ford Motor Company CEO William Clay Ford Jr. unveiled a
restructuring plan this week that calls for eliminating up to
30,000 jobs and closing several factories in North America by
2012, according to various published reports.  Dubbed as the "Way
Forward," the plan also proposes to reduce production capacity by
26% in three years.

Executive positions will be cut by 12% by March this year.  At
about the same time, the Company will let go of 4,000 salaried
employees.

Plants to be closed include:

   * the St. Louis, Atlanta, assembly plant;
   * the Wixom, Michigan assembly plant;
   * the Batavia Transmission plant in Ohio;
   * the Hapeville, Georgia plant;
   * the Hazelwood, Missouri plant; and
   * the Windsor Casting in Ontario.

The St. Louis facility will be closed within the next two months.
The Wixom plant will be closed by the end of May.  The Hapeville
plant is scheduled to be closed in August or September.

Production at St. Thomas Assembly in Ontario will be reduced to
one shift.

The new restructuring plan is part of an effort by Ford Motor to
overhaul its organization and retrench its operations in order to
stem its massive losses and regain the market share that it has
been losing in North America for the past 10 years.

Ford lost $1 billion before taxes on its automotive operations in
2005, up from an $850 million loss in 2004.  It posted a full-year
profit of $2 billion, down from $3.5 billion in 2004.  

Ford's losses for the past year has been caused by rising fuel
costs and other commodity prices and decreasing sales of its
sports utility vehicles that have been shunned by most customer
because of high fuel prices.  Ford's declining market share in
North America due to intense competition from European and
Japanese carmakers have also contributed to its huge losses.

Initial reaction from Ford's investors showed support for the
restructuring plan as the Company's stock traded at $8.28 a share
at the end of trading on Monday, Jan. 23, 2006.

The company expects to be profitable on its automotive operations
in 2008.

Headquartered in Dearborn, Michigan, Ford Motor Company, is the
world's third largest automobile manufacturer.  Ford Motor Co.
manufactures and distributes automobiles in 200 markets across six
continents.  With more than 324,000 employees worldwide, the
company's core and affiliated automotive brands include Aston
Martin, Ford, Jaguar, Land Rover, Lincoln, Mazda, Mercury and
Volvo.  Its automotive-related services include Ford Motor Credit
Company and The Hertz Corporation.

                     *     *     *  

As reported in the Troubled Company Reporter on Jan. 13, 2006,
Moody's Investors Service lowered the ratings of Ford Motor
Company (Corporate Family and long-term to Ba3 from Ba1). Ford's
SGL-1 Speculative Grade Liquidity rating is affirmed.  The rating
outlook for Ford Motor is negative.

As reported in the Troubled Company Reporter on Jan. 9, 2006,
Standard & Poor's Ratings Services lowered its corporate credit
ratings on Ford Motor Co., Ford Motor Credit Co. (Ford Credit),
and all related entities to 'BB-/B-2' from 'BB+/B-1' and removed
them from CreditWatch, where they were placed on Oct. 3, 2005,
with negative implications.  The outlook is negative.  
Consolidated debt outstanding totaled $141.7 billion at Sept. 30,
2005.

As reported in the Troubled Company Reporter on Dec. 21, 2005,
Fitch Ratings has downgraded the issuer default rating and senior
unsecured debt ratings of Ford Motor Company, Ford Credit Company
and affiliate ratings to 'BB+' from 'BBB-'.  The ratings of The
Hertz Corporation and its subsidiaries are not affected by this
action.  Ford's Rating Outlook remains Negative.


FORD MOTOR: North American Biz Incurs $1.6B Pre-Tax Loss in 2005
----------------------------------------------------------------
Ford Motor Company [NYSE: F] reported 2005 full-year net income
of $2 billion.  In 2004, the company reported net income of
$3.5 billion.

Excluding special items, Ford's 2005 full-year after-tax income
from continuing operations totaled $2.5 billion.  This compares
with year-ago earnings from continuing operations of $4.3 billion,
excluding special items.

Full-year sales and revenues for 2005 were $178.1 billion, up from
$171.7 billion a year ago.

"We accomplished many things in 2005, including the successful
launch of the new Ford Fusion, Mercury Milan and Lincoln Zephyr,
introduction of the company's new innovation initiative,
completion of the sale of Hertz, and an agreement with the UAW to
help reduce rising health care costs," said Chairman and Chief
Executive Officer Bill Ford.  "Excluding North America, our
automotive operations made great progress in 2005; we must keep
working to improve our business in each and every region."

Special items reduced earnings by 6 cents per share in the fourth
quarter.  The pre-tax effect of these items includes:

   -- a charge of $1.3 billion for impairment of Jaguar and Land
      Rover fixed assets;

   -- personnel reduction actions of $962 million; and

   -- the sale of The Hertz Corporation for a total profit of
      $1.5 billion, $1.4 billion of which was recorded in the
      fourth quarter.

In addition, the company's repatriation of foreign earnings
pursuant to the American Jobs Creation Act of 2004 resulted in a
permanent tax savings of about $250 million.  Largely as a result
of these factors and costs associated with Visteon-related
restructuring, special items reduced full-year income by 15 cents
per share.  Finally, full-year net income from continuing
operations was reduced by 9 cents primarily for a cumulative
change in accounting principles related to recent accounting
guidance on the recognition of environmental obligations.

                      Full-Year Highlights

Ford Motor Company full-year highlights include:

   * launch of corporate innovation initiative, including a
     commitment to a ten-fold increase in hybrid production by
     2010;

   * introduction of initiative to improve collaboration with
     select global suppliers of key components and consolidate the
     Company's supply base;

   * sale of The Hertz Corporation, with proceeds of $5.6 billion;

   * finalization of Visteon agreement, which included the
     creation of a Ford-managed, temporary business entity named
     Automotive Components Holdings, LLC.  This entity took
     ownership from Visteon of 17 plants and six offices, research
     centers and other facilities.  This arrangement protects the
     supply of components to Ford plants, improves the
     competitiveness of Ford's supply base, and will reduce Ford's
     costs over time;

   * cessation of assembly operations at Jaguar's Browns Lane
     facility and consolidation of its assembly operations at
     Castle Bromwich and closure of Ford's Lorain Assembly plant
     in Lorain, Ohio;

   * reduction of total automotive personnel by more than 10,000
     during 2005, through personnel reduction actions and
     attrition;

   * ratification of an agreement with the United Auto Workers
     (subject to court approval) to reduce the company's health
     care costs primarily through modifications to the hourly
     retiree health care plan.  These actions are expected to
     reduce Ford's overall retiree health care and life insurance
     (OPEB) obligation by $5 billion, with a projected annual
     cost savings of about $650 million on a pre-tax basis;

   * establishment of a company contribution limit set at 2006
     levels for health care benefits and a reduction of life
     insurance benefits for U.S. salaried retirees.  These actions
     reduced Ford's overall retiree health care and life insurance
     (OPEB) obligation by about $3 billion, with a projected
     annual cost savings of about $400 million on a pre-tax basis.

                         Fourth Quarter

In the fourth quarter, the company reported net income of
$124 million.  This compares with fourth quarter net income of
$104 million in 2004.  Excluding special items, fourth quarter
after-tax income from continuing operations totaled $511 million,
compared to $554 million.

Total sales and revenue in the fourth quarter were $47.6 billion,
compared to $44.9 billion in the year-ago period.

                        Automotive Sector

For the full year, Ford's worldwide Automotive sector reported a
pre-tax loss of $1 billion, compared with pre-tax profit of
$850 million a year ago.  The decline primarily reflected
unfavorable cost performance, volume and mix, and exchange,
partially offset by net pricing.

For the fourth quarter, Ford's worldwide Automotive sector
reported a pre-tax loss of $12 million, an improvement of
$458 million from a pre-tax loss of $470 million a year earlier.   
The improvement primarily reflected favorable volume and mix, net
pricing, cost performance and exchange.

Worldwide automotive revenue for 2005 was $154.5 billion, an
improvement from revenue of $147.1 billion a year ago.  Total
fourth-quarter automotive revenue was $41.8 billion, an increase
of $3 billion from a year ago.

Total company vehicle unit sales in 2005 were 6,818,000, an
increase of 20,000 units from 2004. Fourth-quarter vehicle unit
sales totaled 1,853,000, an increase of 102,000 units from a year
ago.

Automotive cash at Dec. 31, 2005, totaled $25.1 billion of cash,
marketable securities, loaned securities and short-term Voluntary
Employee Benefits Association (VEBA) assets.

                          The Americas

The Americas reported a 2005 full-year pre-tax loss of
$1.2 billion, compared to a pre-tax profit of $1.6 billion a
year ago.  For the fourth quarter, the Americas had a pre-tax
loss of $15 million, an improvement of $411 million compared to a
pre-tax loss of $426 million a year earlier.

North America

For 2005, Ford's North America automotive operations reported a
pre-tax loss of $1.6 billion, a decline of $3 billion from 2004.   
The decline primarily reflected unfavorable cost performance,
lower U.S. market share, lower dealer inventories and adverse
exchange.  For the year, North America's sales totaled
$81.4 billion, compared with $83 billion a year earlier.

For the fourth quarter, North America automotive operations
reported a pre-tax loss of $143 million, compared to a pre-tax
loss of $470 million in 2004.  The improvement primarily reflected
cost reductions and favorable net pricing, partially offset by
operating losses incurred by the former Visteon activities now
controlled by Ford.  Fourth-quarter sales were $22.1 billion,
compared with $21.1 billion in 2004.

South America

Ford's South America automotive operations reported a pre-tax
profit of $389 million, an increase of $249 million from a 2004
pre-tax profit of $140 million.  The improvement primarily
reflected net pricing and favorable volume, as well as a stronger
Brazilian currency.  Full-year sales improved to $4.4 billion from
$3 billion in 2004.

In the fourth quarter, Ford's South America automotive operations
posted a pre-tax profit of $128 million, an improvement of
$84 million, compared with a pre-tax profit of $44 million in
2004.  The improvement primarily reflected favorable net pricing
and exchange.  Fourth-quarter sales were $1.3 billion, an
improvement from $899 million a year ago.

            Ford Europe and Premier Automotive Group

The combined 2005 full-year pre-tax profit for Ford Europe and PAG
was $36 million.  This compares with a loss of $626 million for
2004.  For the fourth quarter, Ford Europe and PAG had a combined
pre-tax profit of $112 million, an improvement from a pre-tax loss
of $324 million a year ago.

Ford Europe

Ford Europe posted a full-year pre-tax profit of $136 million,
compared with a pre-tax profit of $114 million a year ago.  The
improvement primarily reflected favorable cost performance and
exchange, partially offset by unfavorable net pricing and mix.   
Sales for the year totaled $30.2 billion, compared to
$26.5 billion in 2004.

For the fourth quarter, Ford Europe reported a pre-tax profit of
$66 million, an improvement from a pre-tax loss of $69 million a
year ago.  The improvement primarily reflected favorable cost
performance and higher profits at our operations in Turkey,
partially offset by unfavorable product mix.  Fourth-quarter sales
totaled $8.2 billion, compared to $7.4 billion a year ago.

Premier Automotive Group

For 2005, PAG reported a full-year pre-tax loss of $100 million,
an improvement from a pre-tax loss of $740 million a year ago.  
The improvement primarily reflected the impact of new products,
primarily at Land Rover, that resulted in a richer mix and
improved net pricing.  Full-year sales for the group totaled
$30.3 billion, compared to $27.6 billion in 2004.

In the fourth quarter, PAG reported a pre-tax profit of
$46 million, an improvement of $301 million, compared with a
pre-tax loss of $255 million in the year-ago period.  The
year-over-year improvement primarily reflected the impact of new
Land Rover products, resulting in a richer mix and improved net
pricing.  Fourth-quarter sales totaled $8 billion, compared to
$7.8 billion a year ago.

                  Asia Pacific and Africa/Mazda

For the full year, Asia Pacific and Africa/Mazda reported a
pre-tax profit of $316 million, compared with a pre-tax profit of
$163 million a year ago.  In the fourth quarter, Asia Pacific and
Africa/Mazda reported a pre-tax loss of $7 million, compared with
a pre-tax loss of $22 million in 2004.

Asia Pacific and Africa

For full-year 2005, Asia Pacific and Africa reported a pre-tax
profit of $61 million, an improvement of $16 million when compared
with the year ago period.  The improvement primarily reflected
favorable exchange and higher volume, which was partially offset
by unfavorable vehicle mix and higher costs.  Full-year sales
totaled $7.7 billion, an increase from $7 billion in 2004.

For the fourth quarter, Asia Pacific and Africa reported a pre-tax
loss of $39 million, compared with a pre-tax loss of $13 million
in the year-ago period.  The decline primarily reflected
deterioration of results in Ford Australia due to lower volumes
and unfavorable mix.  Fourth-quarter sales totaled $1.8 billion,
compared to $1.6 billion in 2004.

Mazda

For full-year 2005, Ford's share of the pre-tax profit of Mazda
and associated operations was $255 million, compared with
$118 million a year ago.  For the fourth quarter, Ford's share
of the pre-tax profit of Mazda and associated operations was a
pre-tax-profit of $32 million, compared with a pre-tax loss of
$9 million a year ago.  The improvement in both periods primarily
reflected gains in our investment in Mazda's convertible bonds, as
well as higher operating results at Mazda.

                    Financial Services Sector

Financial Services Sector results include The Hertz Corporation
through Dec. 21, 2005, the date on which it was sold.  For the
full year, excluding special items, Ford's Financial Services
sector reported a pre-tax profit of $4.4 billion, compared with a
pre-tax profit of $5 billion last year.  For the fourth quarter,
excluding special items, the Financial Services Sector earned a
pre-tax profit of $881 million, compared with pre-tax profits of
$1 billion a year ago.

Ford Motor Credit Company

Ford Motor Credit reported net income of $2.5 billion in 2005,
down $370 million from a year earlier.  On a pre-tax basis from
continuing operations, Ford Motor Credit earned $3.9 billion in
2005, down $570 million from 2004.

In the fourth quarter of 2005, Ford Motor Credit's net income was
$465 million, down $78 million from a year earlier.  On a pre-tax
basis from continuing operations, Ford Motor Credit earned
$737 million in the fourth quarter, compared with $859 million the
previous year.  The decrease in earnings in both fourth-quarter
and full-year 2005 primarily reflected lower volumes and margins,
partially offset by lower credit losses.

The Hertz Corporation

Hertz reported a full-year 2005 pre-tax profit of $569 million,
excluding special items, which was a year-over-year improvement of
$76 million.  Hertz reported a fourth-quarter pre-tax profit of
$121 million, excluding special items, which was an increase of
$14 million from the same period in 2004.

Ford Motor Company, a global automotive industry leader based in
Dearborn, Michigan, manufactures and distributes automobiles in
200 markets across six continents.  With more than 324,000
employees worldwide, the company's core and affiliated automotive
brands include Aston Martin, Ford, Jaguar, Land Rover, Lincoln,
Mazda, Mercury and Volvo.  Its automotive-related services include
Ford Motor Credit Company and The Hertz Corporation.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 13, 2006,
Moody's Investors Service lowered the ratings of Ford Motor
Company (Corporate Family and long-term to Ba3 from Ba1) and Ford
Motor Credit Company (long-term to Ba2 from Baa3, and short-term
to Not Prime from Prime-3).  Ford's SGL-1 Speculative Grade
Liquidity rating is affirmed.  Moody's said the rating outlook for
Ford and Ford Credit is negative.

As reported in the Troubled Company Reporter on Jan. 9, 2006,
Standard & Poor's Ratings Services lowered its corporate credit
ratings on Ford Motor Co., Ford Motor Credit Co. (Ford Credit),
and all related entities to 'BB-/B-2' from 'BB+/B-1' and removed
them from CreditWatch, where they were placed on Oct. 3, 2005,
with negative implications.  S&P said the outlook is negative.  

As reported in the Troubled Company Reporter on Dec. 21, 2005,
Fitch Ratings has downgraded the issuer default rating and senior
unsecured debt ratings of Ford Motor Company, Ford Credit Company
and affiliate ratings to 'BB+' from 'BBB-'.  The ratings of The
Hertz Corporation and its subsidiaries are not affected by this
action.  Ford's Rating Outlook remains Negative.


GALAXY 1999-1: Fitch Affirms $30 Mil. Class C-2 Notes' BB- Rating
-----------------------------------------------------------------
Fitch Ratings affirms two classes of notes issued by Galaxy 1999-1
CLO Ltd.  These affirmations are the result of Fitch's review
process and are effective immediately:

   * $92,000,000 class B-2 notes at 'BBB-'
   * $30,000,000 class C-2 notes at 'BB-'

Galaxy is a collateralized debt obligation managed by AIG Global
Investment Corp. which closed June 22, 1999.  Galaxy is composed
of primarily high yield corporate loans with some limited exposure
to high yield bonds.  Included in this review, Fitch discussed the
current state of the portfolio with the asset manager and their
portfolio management strategy going forward.  In addition, Fitch
conducted cash flow modeling utilizing various default timing and
interest rate scenarios to measure the breakeven default rates
going forward relative to the minimum cumulative default rates
required for the rated liabilities.

Since the last rating action, the collateral portfolio has
experienced some deterioration in the credit quality.  The assets
rated 'CCC+' or lower, excluding defaults, represented
approximately 8.0% as of Dec. 7, 2005 as compared to 4.4% as of
Oct. 25, 2004.

At the same time, defaulted and PIK (paid-in-kind) securities
represented 0.60% of total collateral and eligible investments as
of Dec. 7, 2005, an improvement from 1.52% as of Oct. 25, 2004.
The increase in assets rated 'CCC+' or lower was offset by the
continuing deleveraging of the transaction, with the balance of
the A-1 and A-2 classes reduced by 32% since the last review.

As a result, the portfolio continues to meet its target
overcollateralization levels.  According to the most recent
trustee report, dated Dec. 7, 2005, the class A OC ratio has
increased to 128.93 as of Dec. 7, 2005 from 121.04 as of Oct. 25,
2004, while the Class B OC ratio has improved to 106.52 as of Dec.
7, 2005 from 105.91 as of Oct. 25, 2004.

The ratings of the classes B-2 and C notes address the likelihood
that investors will receive ultimate and compensating interest
payments, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date.

As a result of this analysis, Fitch has determined that the
original ratings assigned to the classes B-2 and C-2 notes still
reflect the current risk to noteholders.


GALVEX HOLDINGS: Wants Court OK to Use SPCP's Cash Collateral
-------------------------------------------------------------
Galvex Holdings Limited and it debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York for
authority to use cash collateral on an interim basis, securing
repayment of pre-petition obligations to SPCP Group LLC.

         Pre-Petition Debt and Use of Cash Collateral
                
Under various Credit and Loan Agreements, the Debtors owe:

    Pre-Petition Lender                 Amount Owed     
    -------------------                 -----------
    Syndicate of Banks                  $60,000,000
    (under a LC Facility
     dated Sept. 22, 2001)

    Bayerische Hypo-und                 $84,000,000
    Vereinsbank Atkiengsellschaft
    (under a Senior Loan Agreement
     dated Jan. 22, 2001)              ------------
                                       $144,000,000

In October 2005, SPCP Group acquired all of the debt under the
Loan Agreements for total consideration slightly in excess of par
value.  SPCO therefore asserts a security interest in the pre-
petition collateral.

The Debtors will use SPCP Group's cash collateral to meet the day-
to-day financing needs of their operations pending the
consummation of a sale of some or substantially all of their
assets.  The Debtors' interim use of the cash collateral will be
in accordance with a Budget the Debtors will present at an interim
cash collateral hearing.

                    Adequate Protection

SPCP has not consented to the Debtors' request.  The Debtors say
SPCP's conduct after acquiring the Loans has been horrible.  SPCP,
the Debtors say, has interfered with the Debtors' business and
management with the intent of assuming control of the Debtors'
assets.

The Debtors hold significant claims against SPCP, including claims
for monetary damages and equitable subordination arising from
SPCP's pre-petition conduct of wanting to control the Debtors'
assets.

The Debtors expect that their claims against SPCP will effectively
reduce or eliminate SPCP's asserted secured claims.  That will
increase the equity cushion that adequately protects SPCP's
asserted interest with respect to any diminution in value of the
pre-petition collateral.

Headquartered in New York, New York, Galvex Holdings Limited --
http://www.galvex.com/-- and its affiliates produce 500,000  
metric tons of galvanized steel annually, operating the largest
independent galvanizing line in Europe.  The Debtors have offices
in New York, Tallinn, Bermuda, Finland, Ukraine, Germany and the
United Kingdom.  The Galvex Group of Companies is privately owned
but is backed by a cross of European syndicate of banks.  David
Neier, Esq., and John E. Tardera, Esq., at Winston & Strawn LLP,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
estimated assets and debts of more than $100 million.


GARDEN RIDGE: Court Approves $593,422 Wausau Settlement Pact
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved
Garden Ridge Corporation and its debtor-affiliates' settlement
agreement with Employers Insurance of Wausau A Mutual Company and
Wausau Insurance Companies.

Prior to the Debtors' chapter 11 filing, Garden Ridge had a
contract with Wausau for workers' compensation insurance and
claims processing.  The contract includes several insurance
policies issued by Wausau between 1994 and 2002.

The Debtors are required by the policies to reimburse a portion of
Wausau's expenditures in connection with the workers compensation
claims.  To secure their reimbursement obligations under the
policies, the Debtors provided Wausau with a letter of credit
through Bank of America in the amount of $1.4 million.

On March 17, 2005, Wausau filed a proof of claim for $5,833,514
that represents the Debtors obligations net of the Letter of
Credit proceeds.  On July 8, 2005, the Debtors filed an adversary
proceeding in the Court seeking judgment against Wausau for breach
of contract and disallowing the proof of claim to the extent that
it exceeds the estimated amount of the claim.

In order to avoid further litigation, and the fees and expenses
associated with, both parties have negotiated a settlement
agreement regarding their disputes.

The salient terms and conditions of the agreement include:

   a) Wausau has previously applied $556,578 of the Letter of
      Credit proceeds to outstanding invoices, issued by Wausau to
      the Debtors on or prior to August 1, 2005, based on the
      Debtors' reimbursement obligations;

   b) Wausau will pay $593,422 to the Debtors by check or wire
      transfer on or before ten business days after the Effective
      Date;

   c) the remaining $250,000 of the Letter of Credit proceeds will
      be held in reserve by Wausau.  All invoices due and owing
      after August 1, 2005 under the policies will be paid out of
      the reserve.  In the event the reserve falls below $100,000
      before a final resolution, the Debtors will replenish the
      reserve by $100,000.

   d) six months from the Effective Date, both parties will
      negotiate in good faith regarding:

        i) further reduction of the reserve amount held by Wausau
           based upon the history of invoices paid during the
           previous six months,

       ii) a possible increase in the reserve amount in the event
           of significant claims, and

      iii) the Debtors' option to buy out the policies;

   e) if both parties are unable to reach a mutual resolution
      regarding all of the Letter of Credit proceeds, then they
      retain the right to seek a legal resolution to determine
      ownership over any disputed portion of the Letter of Credit
      proceeds;

   f) upon the Effective Date, the proof of claim is disallowed in
      its entirety.  Wausau preserves any and all rights under the
      policies and other agreements for amounts owed to it and to
      seek payment of any claims from the Debtors; and

   g) upon the Effective Date, the adversary proceeding will be
      dismissed and the parties will submit whatever additional
      stipulations are necessary to dismiss the adversary
      proceeding in accordance with the terms of the stipulation.

Headquartered in Houston, Texas, Garden Ridge Corporation --
http://www.gardenridge.com/-- is a megastore home decor retailer  
that offers decorating accessories like baskets, candles, crafts,
home accents, housewares, party supplies, pictures and frames,
pottery, seasonal items, and silk and dried flowers.  The Company
and its debtor-affiliates filed for chapter 11 protection on
February 2, 2004 (Bankr. D. Del. Case No. 04-10324).  Joseph M.
Barry, Esq., at Young Conaway Stargatt & Taylor LLP, represents
the Debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed estimated
debts and assets of over $100 million.  The Bankruptcy Court
confirmed the Debtors' First Amended Joint Plan of Reorganization
on Apr. 29, 2005. The Plan took effect on May 12, 2005.


GENEVA STEEL: Trustee Settles GATX Capital Lease Dispute
--------------------------------------------------------
James T. Markus, the chapter 11 Trustee appointed in Geneva Steel
LLC's bankruptcy case, asks the U.S. Bankruptcy Court for the
District of Utah, Central Division, to approve the settlement
agreement resolving his dispute with GATX Capital Corp.

GATX had opposed the Trustee's move to sell the Debtor's steel
plant in Utah County, free and clear of GATX's claim to a
leasehold interest.

GATX asserts a leasehold interest in the Utah property on account
of facilities and related equipment collectively described as a
"plasma fired cupola," built on the Debtor's property in 1995.

                    The Cupola Lease

Annette W. Jarvis, Esq. at Ray Quinney & Nebeker PC, tells the
Bankruptcy Court that GATX financed the construction of the Cupola
and retained title to it.  

The Debtors, in turn, leased the land where the Cupola was built
to GATX.  GATX then sub-leased the facility back to Geneva,
expecting to recover its investment through the Debtors' lease
payments.

The Bankruptcy Court authorized the Debtors to reject the Cupola
lease during its first chapter 11 case and GATX eventually sought
payment for damages arising as a result of the rejection.

GATX argued that it was entitled to an administrative expense
claim for the cost of dismantling and removing the equipment.  In
the final calculation of the amount of its claim, GATX was given
credit for projected removal costs.  

However, after the Debtor's emerged from its first bankruptcy
proceeding, the Cupola has remained idle and on-site.  In
addition, GATX has not made any rent payments under the lease, nor
paid for taxes, utilities and insurance.

                     GATX Settlement

Pursuant to the terms of the settlement wit the Trustee, GATX
agrees to remove the Cupola from the Debtors' property on the
earlier of March 30, 2006 or the closing date of the Debtors'
steel plant.  

GATX will shoulder all costs and expenses associated with the
removal of the equipment but it will not be liable to the estate
for any rent, taxes, insurance or related expenses under the
lease.

If GATX fails to remove the Cupola by the agreed deadline, the
equipment will be deemed abandoned and the Debtors will be
entitled to retain any proceeds derived from the subsequent sale
or disposal of the Cupola.

Headquartered in Provo, Utah, Geneva Steel LLC owns and operates
an integrated steel mill.  The Company filed for chapter 11
protection on January 25, 2002 (Bankr. Utah Case No. 02-21455).
Andrew A. Kress, Esq., Keith R. Murphy, Esq., and Stephen E.
Garcia, Esq., at Kaye Scholer LLP, represent the Debtor in its
chapter 11 proceedings.  James T. Markus was appointed as the
chapter 11 Trustee for the Debtor's estate on June 22, 2005.  John
F. Young, Esq., at Block Markus & Williams, LLC represents the
chapter 11 Trustee.  When the Company filed for protection from
its creditors, it listed $262 million in total assets and
$192 million in total debts.


GMAC MORTGAGE: Fitch Raises Class B-2 Certificates' Rating to BB+
-----------------------------------------------------------------
Fitch Ratings took action on this GMAC Mortgage Corp. home equity
issue:

Series 2003-J1:

    * Class A affirmed at 'AAA'
    * Class M-1 affirmed at 'AAA'
    * Class M-2 upgraded to 'AAA' from 'AA'
    * Class M-3 upgraded to 'AA+' from 'A'
    * Class B-1 upgraded to 'AA' from 'BBB'
    * Class B-2 upgraded to 'BB+' from 'BB'

The underlying collateral in series 2003-J1 includes 15 year
fixed-rate mortgages extended to prime borrowers and are secured
by first liens on one- to four-family residential properties.  As
of the December 2005 distribution date, the transaction is 34
months seasoned and the pool factor (current mortgage loan
principal outstanding as a percentage of the initial pool) is 24%.
The master servicer for the deal is GMAC Mortgage Corporation,
rated 'RMS1' by Fitch.

The affirmations reflect a satisfactory relationship between
credit enhancement (CE) and future loss expectations and affect
approximately $103.3 million of outstanding certificates.  The
upgrade reflects an improvement in the relationship between CE and
future loss expectations and affects approximately $2.12 million
of outstanding certificates.


GSI GROUP: Robert E. Girardin Replaces Randall N. Paulfus as CFO
----------------------------------------------------------------
GSI Group Inc.'s interim chief financial officer, Randall N.
Paulfus, resigned from his position effective January 30, 2006.

The Company appointed Robert E. Girardin to serve as Interim Chief
Financial Officer.  

Mr. Girardin is a partner with Tatum LLC, a financial services
firm.  Mr. Girardin's services will be engaged through an interim
executive services agreement between the Company and Tatum, and a
separate letter agreement between the Company and Mr. Girardin.

Under the terms of the Employment Arrangement, the Company will
pay Mr. Girardin a $28,000 monthly salary and pay Tatum a $7,000
monthly fee through the term of Mr. Girardin's engagement with the
Company.  

From 2002 to 2004, Mr. Girardin served as the Chief Financial
Officer of AMS Direct, Inc., a direct response marketing company.
From 2000 to 2001, Mr. Girardin served as the Vice President
Finance for American Pharmaceutical Partners, Inc., a specialty
pharmaceuticals manufacturer and from 1997 to 1999 Mr. Girardin
served as the Chief Financial Officer of a division of
DiverseyLever and Unilever.  Mr. Girardin, age 56, is a Chartered
Accountant.

Based in Assumption, Illinois, GSI Group Inc. is one of the
largest global manufacturers of grain storage bins and related
drying and handling systems, as well as capital equipment for
swine and poultry producers.  GSI markets its products in
approximately 75 countries through a network of more than 2,500
independent dealers to grain, protein producers and large
commercial businesses.  In May 2005, GSI was acquired by
Charlesbank Capital Partners, a Boston-based private equity firm
known for partnering with experienced management teams to grow
fundamentally strong businesses.

                         *     *     *

As reported in the Troubled Company Reporter on May 3, 2005,
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to GSI Group Inc.  At the same time, Standard &
Poor's assigned its 'B-' senior secured rating to the proposed
$125 million senior unsecured notes due in 2013, issued to redeem
GSI's existing senior subordinated notes and other debt. GSI is
the primary operating company.  All of the company's subsidiaries
will be designated restricted subsidiaries.  S&P says the outlook
is stable.

As reported in the Troubled Company Reporter on May 2, 2005,
Moody's Investors Service has assigned a B3 rating to the
proposed senior notes of The GSI Group, Inc., which will
be used to refinance existing indebtedness in connection with
the company's pending acquisition by GSI Holdings Corp. (an
affiliate of Charlesbank Capital Partners, LLC).  In addition,
Moody's has affirmed GSI's existing ratings, including its B2
senior implied rating, and assigned a speculative grade
liquidity rating of SGL-2.  Approximately $125 Million of rated
debt is affected.  Moody's says the rating outlook is stable.

These ratings were assigned:

   * $125 million senior notes due 2013, at B3;
   * Speculative grade liquidity rating, at SGL-2.

These ratings were affirmed:

   * Senior implied, at B2;
   * $100 million senior subordinated notes, at Caa1;
   * Senior unsecured issuer rating, at B3.


HAROLD'S STORES: Lenders Up Borrowing Availability by $3 Million
----------------------------------------------------------------
Harold's Stores, Inc. (Amex: HLD) negotiated an amendment to its
existing credit facility with Wells Fargo Retail Finance II, LLC
that will provide over $3 million of additional liquidity and
extend the existing agreement for three years.

Under the terms of the amendment, the agreement has been extended
by three years until February 5, 2010.  Additionally, minimum
required excess availability under the line has been reduced from
$1.35 million to $1.0 million, and the maximum revolver amount has
been increased from the lesser of $25 million, or $22 million plus
outstanding participant advances (which were previously $4
million) to the lesser of $28 million, or $22 million plus
outstanding participant advances (which are now $7 million).

The $3 million increase in the credit facility is based upon an
increase of $3 million in the loan participation agreement between
Wells Fargo and RonHow, LLC, bringing RonHow's total participation
to $7 million.  RonHow is owned and controlled directly or
indirectly by Ronald de Waal and W. Howard Lester.  Mr. de Waal
and Mr. Lester are both major beneficial owners of Company common
stock, and Mr. Lester is also a director of the Company.  The
Company has obtained these increases in order to provide for
additional working capital.

"This funding is a significant show of support by our major
shareholders," said Leonard Snyder, Interim Chief Executive
Officer.  Mr. Snyder continued, "This amendment and funding will
provide the Company with the ability to implement key strategic
initiatives in 2006 that I believe could have a positive effect on
the Company's operating results.  These include strategies to
relocate existing stores in Greenville, South Carolina and
Atlanta, Georgia and open new Harold's stores in Montgomery,
Alabama and Little Rock, Arkansas.  This funding will also enhance
our daily working capital."

The new $3 million participation will bear interest at a rate 4%
higher than the Wells Fargo line and is convertible at the option
of RonHow into a new series of 2006-A Preferred Stock having terms
equivalent to the Company's existing Series 2003-A Preferred Stock
except for the conversion rate of the preferred stock into common
which will be at $0.87 per share based on the 20 trading day
average price immediately preceding the closing.

Founded in 1948 and headquartered in Dallas, Texas, Harold's
Stores, Inc. currently operates 41 upscale ladies' and men's
specialty stores in 19 states.  The Company's Houston locations
are known as "Harold Powell."

At Oct. 29, 2005, Harold's Stores, Inc.'s balance sheet showed a
$12,746,000 stockholders' deficit compared a $9,594,000 deficit at
Jan. 29, 2005.


HEADWATERS INC: Earns $28.3 Million in Quarter Ended Dec. 31
------------------------------------------------------------
Headwaters Incorporated (NYSE: HW) reported results for its
quarter ended Dec. 31, 2005.

Total revenue for the quarter ended Dec. 31, 2005, was
$280.5 million, up 28% from $218.4 million reported for the
December 2004 quarter.

Operating income increased 42%, to $50.3 million in the December
2005 quarter compared to $35.3 million in the prior year quarter.

Net income for the December 2005 quarter was $28.3 million, using
48.6 million weighted-average shares outstanding.  Net income for
the December 2004 quarter was $11.1 million, using 40.6 million
weighted-average shares outstanding.

At Dec. 31, 2005, total assets amounted to $1.6 billion and total
liabilities amounted to $959 million.

"Our financial results in our first fiscal quarter continue the
track record of consistent earnings and revenue growth," Scott K.
Sorensen, Headwaters' chief financial officer, stated.  "While
uncertainty exists in our synfuels business, we believe our
understanding of the potential financial impact of phase-out due
to high oil prices will improve prior to the end of our fiscal
second quarter.  We expect to update our consolidated Headwaters
view on guidance estimates for the full fiscal year in our fiscal
second quarter earnings release.  Our operating businesses are
performing well and we are very optimistic about Headwaters'
opportunities for further growth and investment."

                 Litigation Settlement Proceeds

In January 2006, Headwaters received the final $70 million payment
due from the litigation settlement reached with AJG in 2005.  
Using these proceeds, Headwaters repaid all of the $30 million
outstanding under the revolving credit facility and also repaid an
additional $24 million of the first lien term loan, effectively
pre-paying all scheduled principal payments on the term-debt until
November 2007.

Headquartered in South Jordan, Utah, Headwaters Incorporated --
http://www.hdwtrs.com/-- is a world leader in creating value  
through innovative advancements in the utilization of natural
resources.  Headwaters Inc. is a diversified growth company
providing products, technologies and services to the energy,
construction and home improvement industries.  Through its
alternative energy, coal combustion products, and building
materials businesses, the company earns a growing revenue stream
that provides the capital needed to expand and acquire synergistic
new business opportunities.

Headwaters Incorporated's 2-7/8% Convertible Senior Subordinated
Notes due 2016 carry Standard & Poor's B- rating.


IELEMENT CORP: Posts $328,262 Net Loss in Quarter Ended Dec. 31
---------------------------------------------------------------
IElement Corporation (OTCBB:IELM) delivered its financial results
for the quarter ended Dec. 31, 2005, to the Securities and
Exchange Commission on Jan. 20, 2006.

For the three months ended Dec. 31, 2005, IElement incurred a
$328,262 net loss on $1,119,772 of revenue, in contrast to a
$99,807 of net income on $1,415,148 of revenue, for the same
period in 2004.

Revenue for the three months ended Dec. 31, 2005 decreased by
approximately $295,376 from the same period ended Dec. 31, 2004
for two reasons:

     a) the Company has cut back on its sales force in
        anticipation of redirecting it to another market that has
        allowed the customer base to decrease as customer
        contracts expire and are not renewed; and

     c) the prior year income statement had $128,334 and $358,001
        of non-recurring consulting revenue for the three and nine
        month periods ended Dec. 31, 2004, respectively.

The Company's balance sheet at Dec. 31, 2005 show $4,550,854 in
total assets and liabilities of $5,451,724, resulting in a
stockholders' deficit of $900,870.

                   Private Placement

IElement recently completed a private placement in the amount of
$1,579,375 with warrants that would bring in an additional
$2,256,250 upon the exercise of all warrants.  The placement was
conducted as a "Unit Offering" with each $17,500 Unit consisting
of 500,000 shares of common stock and warrants to purchase another
250,000 shares at ten cents per share.

IElement originally sought to raise $560,000 in the placement but
increased the offering to ensure the company could meet more long-
term goals.  Ivan Zweig, IElement's CEO, said, "We expect that the
funding will enable us to expand our footprint and product
offerings as well as gain market share.  At the same time, our
customers will be able to rely on us for the state-of-the-art
telecommunications solutions, consultative approach and
personalized customer service that they have enjoyed for years."

IElement intends to use the proceeds to bolster its sales presence
in its current markets while pushing into new ones, add to its
growing stable of product offerings and pursue the acquisition of
complimentary businesses.  The company will also upgrade certain
network equipment to better accommodate the rapid growth expected
in the VoIP sector.

                    Going Concern Doubt

Bagell, Josephs & Company, L.L.C., expressed substantial doubt
about IElement's ability to continue as a going concern after it
audited the Company's financial statements for the fiscal year
ended March 31, 2005, due to operating losses and capital
deficits.

                 About IElement Corporation

IElement Corporation -- http://www.ielement.com/-- provides  
telecommunications services to small and medium sized businesses.
IElement provides broadband data, voice and wireless services by
offering integrated T-1 lines as well as a Layer 2 Private Network
and VOIP solutions.  IElement has a network presence in 18 major
markets in the United States, including facilities in Los Angeles,
Dallas, and Chicago.


INTERNATIONAL SPECIALTY: S&P Lowers Corporate Credit Rating to BB-
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
International Specialty Products Inc. (ISP) and its subsidiaries
by one notch. The corporate credit rating is now 'BB-'.  The
outlook is stable.
      
"The downgrade was prompted primarily by prospects that cash flow
protection and debt leverage measures will remain too weak to
support the former ratings, and by ongoing risks associated with
financial policies and the company's private ownership," said
Standard & Poor's credit analyst Cynthia Werneth.
     
At the same time, based on preliminary terms and conditions,
Standard & Poor's assigned its 'BB-' senior secured debt rating
and a recovery rating of '2' to ISP Chemco Inc.'s proposed $1.15
billion senior secured credit facility.  These ratings indicate
Standard & Poor's belief that lenders will experience substantial
(80% to 100%) recovery of principal in a payment default scenario.

Proceeds from the new bank credit facility will be used to repay
Chemco's existing bank debt and subordinated notes and  
International Specialty Holdings Inc.'s existing senior notes.
Although the proposed refinancing will lower interest expense,
extend debt maturities, meaningfully increase prepayable debt, and
simplify the capital structure, it will result in a slight
increase in pro forma debt and more concentrated debt maturities.
Also, recovery prospects for bank debtholders under the new credit
facility are significantly weaker than those under the smaller,
existing credit facility.  Standard & Poor's will withdraw all its
ratings on the existing debt instruments upon closing of the
proposed refinancing.
     
The ratings on Wayne, New Jersey-based ISP reflect its aggressive
financial profile, and its satisfactory business position as a
global specialty chemicals producer with about $1.2 billion of
annual sales pro forma for a proposed reorganization.  About two-
thirds of sales are of specialty chemicals, with the remainder
almost evenly split between industrial chemicals and elastomers.


LEASEWAY MOTORCAR: Chapter 11 Case Summary
------------------------------------------
Lead Debtor: Leaseway Motorcar Transport Company
             4749 Witmer Road
             P.O. Box 389 LBO
             Niagara Falls, New York 14305

Bankruptcy Case No.: 06-00107

Debtor-affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Performance Logistics Group, Inc.          06-00108
      Performance Transportation Services, Inc.  06-00109
      Vehicle Logistics Associates, L.L.C.       06-00110
      PLG Leasing Corp.                          06-00111
      LAC Holding Corp.                          06-00112
      E. and L. Transport Company L.L.C.         06-00113
      Automotive Logistics Corp.                 06-00114
      Florida Leasco Company L.L.C.              06-00115
      HFS Investments, Inc.                      06-00116
      Logistics Computer Services, Inc.          06-00117
      Transportation Releasing L.L.C.            06-00118
      Hadley Auto Transport                      06-00119
      Hadley Computer Services                   06-00120

Type of Business: Performance Transportation Service is the second
                  largest North American transporter of new light
                  vehicles.  The Debtors also established
                  a short-haul vehicle receiving service.  The
                  Debtors have also developed software and support
                  services to conduct their hauling services more
                  efficiently and have created derivative
                  applications of those software to assist other
                  businesses in tracking their inventory.
                  See http://www.pts-inc.biz/

Chapter 11 Petition Date: January 25, 2006

Court: Western District of New York (Buffalo)

Debtors' Counsel: Garry M. Graber, Esq.
                  Hodgson, Russ LLP
                  1800 One M&T Plaza, Suite 2000
                  Buffalo, New York 14203
                  Tel: (716) 856-4000
                  
                        -- and --
                  
                  James A. Stempel, Esq.
                  Kirkland & Ellis LLP
                  200 East Randolph Drive
                  Chicago, Illinois 60601
                  Tel: (312) 861-2000


Estimated Assets: $10 Million to $50 Million

Estimated Debts:  More than $100 Million


LEGACY ESTATE: Gets Interim OK to Access Lenders' Cash Collateral
-----------------------------------------------------------------
The Honorable Alan Jaroslovsky of the U.S. Bankruptcy Court for
the Northern District of California in Santa Rosa gave The Legacy
Estate Group LLC access to its lenders' cash collateral.

                        Prepetition Debts

Legacy Estate owed two promissory notes for $15.7 million to JM
Bryan Family Trust.  These notes were originally issued in favor
of Mechanic's Bank and assigned to the JM Trust in March 2005.  
The notes are secured by a deed of trust granted by Legacy Estate
on the Freemark Abbey winery.  This deed of trust is senior to the
deed of trust issued in favor of Laminar Direct Capital, L.P.

The Debtor owed $1.3 million to Red Barn Ranch, LLC, as of
Nov. 18, 2005, when it filed for bankruptcy.  The obligation stems
from a 20-year agreement with Red Barn to purchase and accept all
harvested grapes.

Legacy Estate also owes $5 million to other vineyards for the 2005
grape harvest.  These grapes may be subject to the California
producers lien as defined in Section 55400 of the California Food
and Agricultural Code that says a producers' lien attaches from
the date of delivery of a farm product.  Sections 55632 and 55635
of the CFAC also provide that the lien has priority over all other
liens and encumbrances except labor claims or warehouseman liens.

The Debtor entered into three credit agreements with Laminar for a
total principal amount of $53 million.  The loans were secured by
the Debtor's real and personal property, including the wineries
and buildings, equipment and inventory.  The Debtor says those
assets had a $100 million aggregate value at the time of the
Credit Agreements were signed.

Laminar acts as the agent for the lenders.

                       Adequate Protection

To provide the Agent, for the benefit of the Lenders, with
adequate protection required under Section 363 of the U.S.
Bankruptcy Code for any diminution in the value of their
collateral, the Debtor will grant a replacement lien having the  
same extent, validity and priority as the prepetition liens.

The Debtor will use the cash collateral to fund its operations,
payroll, and other operating expenses necessary to maintain the
value of the estate while selling its business.

The Debtor is authorized to:

   (a) exceed any line item in the approved budget by 20% provided
       that it does not exceed the aggregate budgeted expenditures
       for any period by more than 10%, and

   (b) carry over unused funds budgeted in any period for use in
       future periods.

Papers filed with the Court do not include the approved budget.

The lenders agreed to a $250,000 carve-out for:

   (a) all statutory fees of the Court and the U.S. Trustee;

   (b) professional fees of the agent and the lenders; and

   (c) allowed professional fees of the Debtor and the Official
       Committee of Unsecured Creditors.

Legacy Estate will stop using the cash collateral on the:

   (a) effective date of its plan of reorganization; or

   (b) consummation of a sale of all or substantially all of its
       assets.

Judge Jaroslovsky will convene a Final Cash Collateral Hearing on
May 19, 2006, at 10:00 a.m.

Thomas E. Patterson, Esq., at Klee Tuchin Bogdanoff & Stern LLP
represents Laminar Direct Capital, L.P.

Headquartered in Saint Helena, California, The Legacy Estate Group
LLC -- http://www.freemarkabbey.com/-- owns Freemark Abbey
Winery, which produces a range of red, white, and dessert wines.
Legacy Estate and Connaught Capital Partners, LLC, filed for
chapter 11 protection on Nov. 18, 2005 (Bankr. N.D. Calif.
Case No. 05-14659).  John Walshe Murray, Esq., Lovee Sarenas,
Esq., Matthew A. Taylor, Esq., and Robert A. Franklin, Esq., at
Law Offices of Murray and Murray represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed $108,287,046 in assets and
$84,585,230 in debts.


LEGACY ESTATE: Taps Morrison & Foerster as Special Counsel
----------------------------------------------------------
The Legacy Estate Group LLC and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of California in Santa
Rosa for authority to retain Morrison & Foerster LLP as their
special corporate and debt financing counsel.

The Debtors also want to pay a $50,000 postpetition retainer to
Morrison & Foerster.

Morrison & Foerster will:

      a) serve as a general corporate counsel, and provide advice
         relating to general corporate natters, disclosure
         requirements, corporate transactions, merger, acquisition
         and asset disposition issues;

      b) investigate, research and analyze legal and factual
         corporate issues, and prepare relevant corporate
         documents;

      c) provide services pertaining to other related matters such
         as general commercial litigation and tax and employee
         benefit issues;

      d) negotiate with potential lenders and investors regarding
         debtor-in-possession financing, equity investment or
         merger and acquisition transactions; and

      e) provide other services relate to corporate issues or debt
         and equity financing pursuant to any plan of  
         reorganization.

The hourly rate for Morrison & Foerster's professionals are:

         Designation                        Hourly Rate
         -----------                        -----------
         Members                           $485 to $850
         Associates                        $235 to $480
         Paralegals and Specialists        $125 to $240

Adam Lewis, Esq., at Morrison & Foerster, assures the Bankruptcy
Court that his firm does not hold or represent any interest
adverse to the Debtors or their estates.

With more than a thousand lawyers in 19 offices around the world,
Morrison & Foerster -- http://www.mofo.com/-- offers clients  
comprehensive, global legal services in business and litigation.

Headquartered in Saint Helena, California, The Legacy Estate Group
LLC -- http://www.freemarkabbey.com/-- owns Freemark Abbey  
Winery, which produces a range of red, white, and dessert wines.
Legacy Estate and Connaught Capital Partners, LLC, filed for
chapter 11 protection on Nov. 18, 2005 (Bankr. N.D. Calif.
Case No. 05-14659).  John Walshe Murray, Esq., Lovee Sarenas,
Esq., and Robert A. Franklin, Esq., at Law Offices of Murray and
Murray represent the Debtors in their restructuring efforts.  When
the Debtors filed for protection from their creditors, they
listed $108,287,046 in assets and $84,585,230 in debts.


LUCENT TECHNOLOGIES: Posts $104 Million Net Loss in First Quarter
-----------------------------------------------------------------
Lucent Technologies (NYSE: LU) reported results for the first
quarter of fiscal 2006, which ended Dec. 31, 2005, in accordance
with U.S. generally accepted accounting principles.  For the
quarter, Lucent reported a net loss of $104 million.  These
results compare with net income of $372 million in the fourth
quarter of fiscal 2005 and net income of $174 million, in the
year-ago quarter.

The first quarter's loss included a charge of $278 million, for a
bankruptcy court judgment related to litigation between Lucent and
the trustee for Winstar Communications.  This judgment is being
appealed to the U.S. District Court in Delaware.  In the fourth
quarter of fiscal 2005, tax items and certain other significant
items had a positive impact of $128 million.  Significant items
had a negative impact of $22 million in the year-ago quarter.

The company reported revenues of $2.05 billion in the quarter, a
decrease of 16% sequentially and a decrease of 12% from the year-
ago quarter.  The company's revenues were $2.43 billion in the
fourth quarter of fiscal 2005 and $2.34 billion in the year-ago
quarter.

"This quarter, despite the decline in revenue, we maintained a
solid gross margin performance due to our continued focus on
simplifying our operations and diligently managing our cost
structure," said Lucent Technologies Chairman and CEO Patricia
Russo.  "Based on the review of our expectations for fiscal 2006
and ongoing interactions with our customers, we are confident that
our revenue performance will be much stronger for the remainder of
the year.

"We have continued to strengthen our position in next-generation
networks this quarter by winning three more IMS contracts, and we
are conducting an extensive lab trial with Verizon on a wide range
of elements from our IMS solution," said Mr. Russo.  "We continue
to pursue those market opportunities that align with our strengths
and investments in IMS, 3G mobile networks, services, next-
generation optical and access, and applications."

"As we previously stated, we now expect Lucent's annual revenues
for fiscal 2006 to be essentially flat or increase on a percentage
basis in the low-single digits for the year," said Lucent
Technologies Chief Operating and Financial Officer Frank D'Amelio.  
"As always, we will continue to look for ways to profitably grow
the business and expand our customer base, while improving our
productivity."

Gross margin for the first quarter of fiscal 2006 was 42% of
revenues as compared with 46% in the fourth quarter of fiscal 2005
and 42% in the year-ago quarter.

Operating expenses for the first quarter of fiscal 2006 were $940
million as compared with $810 million for the fourth quarter of
fiscal 2005 and $665 million in the year-ago quarter.  Operating
expenses in the first quarter of fiscal 2006 included a $278
million charge related to the judgment in the Winstar litigation.

The net pension and postretirement benefit credit for the first
quarter was $104 million, compared with $185 million in the fourth
quarter of fiscal 2005 and $175 million in the year-ago quarter.

As of Dec. 31, 2005, Lucent had $4.38 billion in cash and
marketable securities, a decrease of $550 million from the quarter
ended Sept. 30, 2005.  The decrease was primarily driven by the
payment of the company's fiscal 2005 employee incentive awards
and, to a lesser extent, an increased use of working capital.

Lucent Technologies -- http://www.lucent.com/-- designs and    
delivers the systems, services and software that drive next-
generation communications networks.  Backed by Bell Labs research
and development, Lucent uses its strengths in mobility, optical,
software, data and voice networking technologies, as well as
services, to create new revenue-generating opportunities for its
customers, while enabling them to quickly deploy and better manage
their networks.  Lucent's customer base includes communications
service providers, governments and enterprises worldwide.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 28, 2005,
Fitch Ratings has upgraded Lucent Technologies:

     -- Issuer default rating to 'BB-' from 'B';
     -- Senior unsecured debt to 'BB-' from 'B';
     -- Subordinated convertible debentures to 'B' from 'CCC+'
     -- Convertible trust preferred securities to 'B' from 'CCC+'.


MAXICARE HEALTH: Marcum & Kliegman Replaces E&Y as Auditor
----------------------------------------------------------
Maxicare Health Plans, Inc.'s former auditors, Ernst & Young LLP,
resigned as the Company's independent registered public accounting
firm effective upon the filing by the Company of its quarterly
report on Form 10-Q for the quarter ended September 30, 2005.

                       Going Concern Doubt

Ernst & Young LLP expressed substantial doubt about Maxicare'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 discontinued
operations, recurring net losses and deficiencies in working
capital and shareholders' equity.

Effective January 18, 2006, the Company engaged Marcum & Kliegman
LLP, as the Company's independent registered public accounting
firm for the year ended December 31, 2005.  The engagement had
been unanimously approved by the Audit Committee of the Company's
Board of Directors.

Maxicare Health Plans, Inc., is a holding company that formerly
operated health maintenance organizations and other subsidiaries,
in the field of managed healthcare.  All significant subsidiaries
formerly operated by Maxicare Health Plans (the California and
Indiana HMOs and Maxicare Life and Health Insurance Company, Inc.)
were placed into bankruptcy, rehabilitation and administrative
supervision, respectively, in May of 2001 and are currently in
liquidation.  These former subsidiaries are no longer included in
Maxicare's consolidated financial statements after May 2001.  The
Company has not been engaged in any active business and has no
reasonable prospects of obtaining or generating any ongoing
business.   The Company is exploring possible strategies to
realize any possible value remaining in the Company.


MCI INC: Qwest Sues MCI To Recover $10,000,000 in Access Charges
----------------------------------------------------------------
Qwest Communications has sued MCI, Inc., for allegedly failing to
pay at least $10,000,000 of access charges related to using
Denver Telco's local network facilities to complete long-distance
phone calls, Jeff Smith of Rocky Mountain News reports.

Qwest filed the lawsuit in the District Court of Denver days after
the completion of the MCI-Verizon merger, the newspaper disclosed.

Qwest said it didn't have the technological capability until late
2003 to know that MCI had failed to pay the access charges, Mr.
Smith related.

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

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications.  The action
affects approximately $6 billion of MCI debt.


MED GEN: Stark Winter Raises Going Concern Doubt
------------------------------------------------
Stark Winter Schenkein & Co., LLP, expressed substantial doubt
about Med Gen, Inc.'s ability to continue as a going concern after
it audited the Company's financial statements for the fiscal years
ended Sept. 30, 2005 and 2004.  The auditing firm pointed to the
Company's significant losses from operations as well as working
capital and stockholder deficiencies.

              Fiscal 2005 Financial Results

Med Gen incurred a $12,214,900 net loss for the year ended Sept.
30, 2005, versus a $9,171,324 net loss for the same fiscal period,
a year ago.

Net sales decreased 23.11% to $802,127 in fiscal year 2005,
compared with $1,043,101 of net sales in the prior fiscal year.  
Four factors contributed to the decrease in sales:

    1) a multi-million dollar advertising campaign by the
       Company's direct competitor, Breath-Rite, which led them to
       dominate the point of purchase sale to consumers;

    2) the successful launch by the Company's retailers of
       competitively priced "generic" snoring products.

    3) the Company's lack of substantial advertising budget that
       did not allow the Company to affect the consumers
       purchasing decisions;

    4) the loss of three major accounts during the last half of
       the fiscal year.  The Wal-Mart, Walgreens and CVS accounts
       contributed over 60% of the gross revenues in the prior
       fiscal years.

At Sept. 30, 2005, the Company's balance sheet showed $1,224,600
in total assets and liabilities of $3,335,352, resulting in a
stockholders' deficit of $2,110,752.

              Global Healthcare Proceedings

Med Gen reported that negotiations aimed at a fair and equitable
settlement in its legal matter with Global Healthcare
Laboratories, Inc., is proceeding in a favorable manner.  Any
settlement would require a release, in a reasonable time frame,
from any judgment claims that now overhang the company.  

Global Healthcare commenced a breach of contract lawsuit against
the Company in May 2003.  In August 2004, a jury verdict totaling
$2,501,191 was awarded in favor of Global Healthcare.

The Company subsequently settled the judgment on Dec. 3, 2004.  
The basic terms of the settlement are the payment of the sum of
$200,000 to plaintiffs, spread over a 4-5 month period and the
registration of 8,000,000 common shares by Jan. 15, 2005.

The Company made the first three installments totaling $75,000
dollars on a timely basis but tendered the fourth payment 13 days
late.  Global Healthcare then unilaterally declared the settlement
null and void.

                   About Med Gen

Med Gen Inc. -- http://www.medgen.com/-- manufactures and markets  
the world's first liquid spray snoring relief formula, Snorenz(R).
Since its existence, Med Gen has continued to develop its "sprays
the way" technology, and in 2003 introduced Good Night's Sleep(R)
to the sleep-aid market.  Both Snorenz(R) and Good Night's
Sleep(R) are nationally advertised and marketed to major chain and
drug stores as well as direct sales via the company web site.


MEDICALCV INC: Registers 78,774,966 Common Shares for Resale
------------------------------------------------------------
MedicalCV, Inc., filed a Registration Statement with the U.S.
Securities and Exchange Commission to allow the resale of
78,774,966 shares of common stock, for a maximum offering of
$66,958,721.

The Company issued some of the common shares to the selling
shareholders starting in December 2005 in exchange for 5% Series A
Convertible Preferred Stock.  Some of the common shares were
issued when warrants were exercised.  

A list of the Selling Shareholders is available for free at
http://ResearchArchives.com/t/s?49a

The Company will not receive any proceeds from the sale of the
shares by the selling shareholders.

The company's common shares are quoted on the OTC Bulletin Board
and trade under the ticker symbol "MDCV."  The company's common
shares trades between $0.85 and $1.10 this month.  

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.

                         *     *     *

                       Going Concern Doubt

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.


MERIDIAN AUTOMOTIVE: Wants Foley & Lardner as Special Counsel
-------------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware for
permission to employ Foley & Lardner LLP as their special counsel,
nunc pro tunc to Dec. 13, 2005.

Foley will advise the Debtors with respect to employee benefits,
labor and employment, and commercial contract matters.

According to Matthew C. Paroly, Vice President and General
Counsel of Meridian Automotive Systems, Inc., Foley will
represent the Debtors in connection with legal matters that were
previously handled by the Debtors' assistant general counsel,
Monica F. MacNamara, who is currently on maternity leave.  

Mr. Paroly relates that Foley currently serves as national
counsel to several automotive supply companies, handling various
legal issues, including human resource, employee matters and
commercial contract matters.  Mr. Paroly stresses that given the
depth of Foley's experience in this regard, the Debtors believe
that Foley is well qualified to represent the Debtors as their
special counsel.

The firm's current customary rates, subject to change from time
to time, are $215 to $760 per hour.

The names and the hourly rates for the attorneys that will
primarily handle the Debtors' labor and employment matters
are:

     Professional                      Hourly Rate
     ------------                      -----------
     John Birmingham                       $400
     Jeff Kopp                             $340
     Ebony Wilkerson                       $215

The names and hourly rates for the attorneys that will
primarily handle general commercial contract matters are:  

     Professional                      Hourly Rate
     ------------                      -----------
     Tom Spillane                          $450
     Tom Chinonis                          $325
     Erin Toomey                           $245

In addition, Foley will be reimbursed for its costs and expenses
incurred in connection with these cases at Foley's normal and
customary rates and charges.

Thomas B. Spillane, Jr., a partner at Foley & Lardner LLP,
in Detroit, Michigan, assures the Court that Foley is a
"disinterested person" as defined in Section 101(14) of the
Bankruptcy Code.

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


MERIDIAN AUTOMOTIVE: Wants to Assume Amended GR Glen Lease
----------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware for
authority to enter into and perform their obligations under a
third amendment with respect to the lease for Glenwood Hills
Corporate Centre, located at 3196 Kraft Avenue, S.E., in Grand
Rapids, Michigan.

The Debtors lease the Premises from GR Glen, LLC.

The Debtors also seek permission to assume the Amended Lease.

                           GR Glen Lease

Meridian Automotive Systems, Inc., entered into the Lease on
December 23, 1999.  The Premises include approximately 19,382
square feet of office space and 1,112 square feet of storage
space.  The Debtors use the Premises for their general corporate
accounting and finance operations.  The Lease will expire on
Sept. 30, 2008.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, tells the Court that the Amendment will
become effective on March 1, 2006, and the lease expiration date
will be extended for an additional 29 months, until Feb. 28,
2011.  Meridian will also have an additional five-year renewal
option under the Amended Lease.

Mr. Brady relates that the Amendment significantly reduces the
rent for the Premises.  Meridian's base rent under the Amendment
during the Rental Period for office space, which will increase 3%
annually, will be:

                          Square Foot     Monthly    Total For
   Period                    Rate         Payment    Period   
   ------                 -----------     -------    ---------
   March 1, 2006 to
   February 28, 2007         $13.50       $21,805     $261,657

   March 1, 2007 to
   February 29, 2008          13.91        22,459      269,507

   March 1, 2008 to
   February 28, 2009          14.32        23,133      277,592

   March 1, 2009 to
   February 28, 2010          14.75        23,827      285,920

   March 1, 2010 to
   February 28, 2011          15.19        24,541      294,497
                                                     ---------
      Total                                         $1,389,173

Meridian's base rent under the Amendment during the Rental Period
for storage space, which will also increase 3% annually, will be:

                          Square Foot     Monthly    Total For
   Period                    Rate         Payment    Period   
   ------                 -----------     -------    ---------
   March 1, 2006 to
   February 28, 2007         $11.47        $1,063      $12,755

   March 1, 2007 to
   February 29, 2008          11.81         1,095       13,137

   March 1, 2008 to
   February 28, 2009          12.17         1,128       13,531

   March 1, 2009 to            
   February 28, 2010          12.53         1,161       13,937

   March 1, 2010 to
   February 28, 2011          12.91         1,196       14,355
                                                     ---------
      Total                                            $67,716

Mr. Brady states that the Amendment also provides for a $68,603
rent credit to be applied in increments of $5,717 to the first 12
monthly installments of rent due for both office and storage
space at the Premises over the period from March 1, 2006, to
Feb. 28, 2007.

                       Substitute Premises

Mr. Brady points out that pursuant to the Amendment, prior to
March 1, 2008, GR Glen has the right to relocate Meridian to a
different office building owned by GR Glen and that is acceptable
to the Debtors upon 90 days' prior notice.  After March 1, 2008,
GR Glen will not have the right to relocate Meridian.

Mr. Brady notes that GR Glen will also provide Meridian with a
$44,000 moving and relocation allowance, which will accrue
interest at 3% annually beginning March 1, 2006, until March 1,
2008.

Furthermore, Mr. Brady states that upon relocation to the
Substitute Premises, the parties will execute an amendment to the
Amended Lease extending the lease term for an additional year
until Feb. 28, 2012, and reducing the base rent by $1 per
square foot at the Substitute Premises for the remaining portion
of the Rental Period.

                 Lease Amendment Must Be Approved

"Entering into the Amendment and assuming the Amended Lease is
supported by [the Debtors'] sound business judgment," Mr. Brady
assures the Court.

Mr. Brady points out that the Premises have served as the
Debtors' finance center for the last several years.  The Premises
remain suitable to serve as the Debtors' finance center.

Meridian will also realize savings by assuming the Amended Lease.  
According to Mr. Brady, the resulting savings for 2006 will be
$151,196.  In addition, over the remaining 31-month period under
the current lease, the rent payable will total $1,214,117.  Over
that same 31-month period, the aggregate base rent under the
Amended Lease will be $726,877, resulting in savings of $487,240
for the Debtors.

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


MERIDIAN AUTOMOTIVE: Has Until May 25 to Decide on 12 Leases
------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware extended Meridian Automotive Systems, Inc.,
and its debtor-affiliates' time until May 25, 2006, to elect
whether to assume, assume and assign or reject unexpired
nonresidential real property leases, without prejudice to their
right to seek further extensions for cause.

As previously reported in the Troubled Company Reporter on Jan. 4,
2006, the Debtors are parties to 12 Non-Residential Real Property
Leases:

    Lessor                            Location
    ------                            --------
    Etkin Equities                    2001 Centerpointe Parkway
                                      Suite 112
                                      Pontiac, Michigan

    DEMBS/ Roth Group                 4280 Haggerty Road
                                      Canton, Michigan

    Ford Motor Land Development Corp. 550 Town Center Drive
                                      Dearborn, Michigan

    GR Glen LLC                       3196 Kraft Ave., S.E.
                                      Grand Rapids, Michigan

    Insite Angola, L.L.C.             300 Growth Parkway
                                      Angola, Indiana

    Communite Improvement Corp.       1020 E. Main Street
                                      Jackson, Ohio

    L.E. Tassel, Inc.                 3075 Brenton Road, S.E.
                                      Grand Rapids, Michigan

    Meri (NC) LLC                     6701 Stateville Blvd.
                                      Salisbury, North Carolina

    North-South Properties LLC        747 Southport Drive,
                                      Shreveport, Louisiana

    P&E Realty Inc.                   13811 Roth Road
                                      Grabill, Indiana

    Rushville Manufacturing Mall
    Land Trust # 101                  1350 Coomerce Street
                                      Rushville, Indiana

    Westfield Industrial Center       13881 West Chicago Street
                                      Detroit, Michigan

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, informs Judge Walrath that because the
Debtors' Chapter 11 cases are large and complex, they have not
had sufficient time to determine what role all of the Real
Property Leases will play in their ongoing restructuring efforts.

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


MESABA AVIATION: Wants Court Approval on Amended CBA with TWU
-------------------------------------------------------------
Mesaba Aviation, Inc., doing business as Mesaba Airlines and the
Transport Workers Union of America are parties to a collective
bargaining agreement effective from May 26, 2000, through May 26,
2005.  The CBA is currently amendable and in a status quo
condition under the provisions of the Railway Labor Act.

Pursuant to the duration clause in the CBA and Section 6 of the
Railway Labor Act, the CBA became amendable and subject to
renegotiation six months prior to its amendable date.

Brian Randow, the Debtor's director for system operations,
relates that before filing for bankruptcy, and continuing after
it, Mesaba has negotiated with all of its unions, including TWU,
seeking consensual agreements that would reduce Mesaba's labor
costs and allow it to successfully reorganize and emerge from
bankruptcy as a strong, profitable airline.

On Nov. 21, 2005, the Debtor informed TWU that the company's
financial condition had become clearer and proposed expedited
negotiations from Nov. 29, 2005, through Dec. 19, 2005.  The
Debtor further stated that the company would seek to reach
agreement with TWU on a new collective bargaining agreement and
thereby avoid a filing under Section 1113(c) of the Bankruptcy
Code.

Mr. Randow relates that on Dec. 2, 2005, the Debtor presented
a confidential comprehensive 61-page description of Mesaba's
business plan in its meeting with TWU.  At the meeting, the
Debtor explained fully in writing and through an extensive live
presentation by senior officers the logic behind and the
justification for its decision to pursue a Business Plan.

At the Dec. 2 presentation, the average annual target for
labor savings was identified at $17,100,000, with $7,100,000 of
that allocated to management and non-contract employees and
$10,000,000 allocated to the union groups.

Mesaba then presented a comprehensive written proposal to TWU for
changes to the CBA needed to permit its reorganization.  The
proposal was accompanied by a spreadsheet showing TWU's target
savings number, how Mesaba proposed for TWU to meet the target,
and the underlying costing of each of the line items that were
identified as savings targets.  Mesaba's human resources
personnel also made a presentation on the proposed Company-wide
benefits changes.

Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman,
A Professional Association, in Minneapolis, Minnesota, attests
that the Term Sheet, the Costing Data, the benefits presentation
and the Business Plan were based on the most complete and
reliable information available to Mesaba at the time of the
proposal.  The Business Plan, the Term Sheet, and the Costing
Data assure that TWU's members are treated fairly and equitably.

Mr. Meyer further attests that Mesaba worked diligently to
provide TWU's experienced negotiators with relevant information
as was necessary for it to evaluate the Business Plan, the Term
Sheet and the Costing Data.

"[The Debtor] has stated consistently that consensual agreements
with its unions are the most desired outcome," Mr. Meyer tells
the U.S. Bankruptcy Court for the District of Minnesota.

On Jan. 2, 2006, a tentative agreement resulted from the Parties'
good faith bargaining and was memorialized in a Letter of
Agreement presenting the amended Collective Bargaining Agreement.

The Amended CBA includes wage and benefit modifications to the
CBA that will provide a critical portion of the labor cost
savings required by Mesaba in order for it to successfully
compete.

The Debtor asks Judge Kishel to approve the Letter of Agreement
modifying its collective bargaining agreement with TWU.

Specifically, the parties agreed:

    a. to a six-year contract that includes:

       -- reduction in 2006 hourly pay rates, beginning in April,
       -- a 3-year longevity freeze, and
       -- a 1% raise in Fiscal Year 2011 (DOS +5);

    b. to modify health and dental benefits, reduce sick leave
       pay, and reduce Short Term Disability and Long Term
       Disability benefits;

    c. that the total contract savings to be realized under the
       Letter of Agreement over the six-year term will be $897,423
       and the projected savings are proportionate to the size of
       the TWU labor group as a percentage of Mesaba's total work
       force; and

    d. that the Debtor's TWU-represented employees will be
       entitled to participate in a profit-sharing plan that is
       acceptable to all of Mesaba's labor groups;

Mr. Meyer contends that the Letter of Agreement satisfies the
Parties' obligations pursuant to their bargaining notices served
in 2005, as well the Company's objectives for TWU as part of its
overall labor cost reduction initiative.

On January 4, 2006, TWU's leadership executed the Letter of
Agreement and the amended CBA, which were ratified on January 9.
The Letter of Agreement requires Mesaba to file a motion for
Court approval by March 30, 2006.

Mr. Meyer clarifies that the Debtor is not seeking to assume the
Amended CBA at this time.  Rather, the Debtor has agreed that any
plan of reorganization that it proposes or supports will provide
for the assumption of the Amended CBA.  Therefore, neither the
entry of an order approving the motion nor the Debtor's execution
of the Letter of Agreement will create administrative expense or
priority claims that would not otherwise be entitled to those
levels of priority.

                          About TWU

The Transport Workers Union of America is an industrial union
affiliated with the American Federation of Labor and Congress of
Industrial Organizations  and the worldwide International
Transport Workers Federation.  It represents workers in mass
transportation, airline, railroad, utility, university,
municipalities, service and allied industries.  TWU's Air
Transport Division represents workers employed by approximately
two dozen airlines.  TWU also represents the aircraft dispatchers
and assistant aircraft dispatchers employed by the Debtor.

                   About Mesaba Aviation Inc.

Mesaba Aviation, Inc., d/b/a Mesaba Airlines --
http://www.mesaba.com/-- operates as a Northwest Airlink     
affiliate under code-sharing agreements with Northwest Airlines.  
The Company filed for chapter 11 protection on Oct. 13, 2005
(Bankr. D. Minn. Case No. 05-39258).  Michael L. Meyer, Esq., at
Ravich Meyer Kirkman McGrath & Nauman PA, represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed total assets of $108,540,000 and
total debts of $87,000,000. (Mesaba Bankruptcy News, Issue No. 9;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


MESABA AVIATION: Court Okays Rejection of Pinnacle Aircraft Lease
-----------------------------------------------------------------
As reported in the Troubled Company Reporter on Jan. 19, 2006,
Mesaba Aviation, Inc., doing business as Mesaba Airlines, told the
U.S. Bankruptcy Court for the District of Minnesota that the it no
longer needs all of its Saab 340B aircraft that it leased from
Pinnacle Airlines, Inc., one of its competitors.  The rental rates
related to the Excess Aircraft are significantly higher than the
current market rate for it and Pinnacle refused to reduce the
rent.

The Debtor sought the Court's permission to reject the leases
related to the Excess Aircraft.

                      Pinnacle Objects

Pinnacle Airlines Inc.'s attorney, Stephen F. Grinnell, Esq., at
Gray Plant Mooty Mooty & Bennett, P.A., in Minneapolis,
Minnesota, argues that:

    1. the Motion does not reject all the leases of the 11 Saab
       340B aircraft and two related engines, which runs contrary
       to Pinnacle's rights;

    2. the timeliness requirement regarding the return of the
       Debtor's "Excess Aircraft" is contrary to Pinnacle's
       rights;

    3. the Debtor has no right to designate the location to which
       the Aircraft Equipment must be delivered; and

    4. the Debtor must not only deliver the "Excess Aircraft", but
       also all of the Aircraft Equipment.

                           *     *     *

Judge Kishel grants the Debtor's request to reject its Aircraft
Leases with Pinnacle to the extent that:

    a. the Debtor will park, at its expense, the Aircraft
       Equipment including all applicable maintenance records,
       logs, and related documents, but excluding two spare
       engines at Millington, Tennessee Regional Jetport (NQA) as
       soon as reasonably practicable;

    b. the Debtor will deliver, at its expense, the Spare Engines,
       including all applicable maintenance records, logs, and
       related documents, to Pinnacle Airlines, 2934 Winchester
       Rd., Memphis, TN 38138, as soon as reasonably applicable;
       and

    b. the Debtor reserves its rights, if any, to assert a
       reimbursement claim against Pinnacle on account of any
       incremental costs for the Debtor's possession of the
       Aircraft Equipment and the Spare Engines, accruing after
       the Termination Date.

Mesaba Aviation, Inc., d/b/a Mesaba Airlines --
http://www.mesaba.com/-- operates as a Northwest Airlink     
affiliate under code-sharing agreements with Northwest Airlines.  
The Company filed for chapter 11 protection on Oct. 13, 2005
(Bankr. D. Minn. Case No. 05-39258).  Michael L. Meyer, Esq., at
Ravich Meyer Kirkman McGrath & Nauman PA, represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed total assets of $108,540,000 and
total debts of $87,000,000. (Mesaba Bankruptcy News, Issue No. 9;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


MESABA AVIATION: Panel Balks at Continued Use of Incentive Plans
----------------------------------------------------------------
As reported in the Troubled Company Reporter on Nov. 11, 2005,
Mesaba Aviation, Inc., sought the U.S. Bankruptcy Court for the
District of Minnesota's authority to continue its Incentive and
Severance Plans and make payments under the Plans consistent with
its prepetition practices.

As reported in the Troubled Company Reporter on Dec. 27, 2005,  
the Air Line Pilots Association, International, argues that the
Debtor's request should be denied because:

    -- "continuation" of the Plans would be detrimental to the
       morale of the pilots and counter-productive to a consensual
       resolution of the Debtor's Chapter 11 case; and

    -- the Debtor has failed to demonstrate that any of the Plans
       is necessary.

                          Committee Objects

Tim J. Robinson, Esq., at Squire Sanders & Dempsey, L.L.P., in
Columbus, Ohio, argues that while the Official Committee of
Unsecured Creditors of Mesaba Aviation Inc., recognizes the need
to provide salaried employees with a competitive compensation
package, the Performance Incentive Compensation Plan is
unacceptable because:

    -- its continuation can potentially mitigate the compensation
       reductions experienced by salaried employees by providing a
       salary increase;

    -- the division of the task of evaluating employees on their
       goal-achievement could allow Officers to receive benefits
       while those at the Director, Manager and Supervisor level
       do not;

    -- it provides an internal administrator with far too much
       discretion with minimal oversight;

    -- the lump-sum payout capped at a percentage of the
       employee's base salary weighted so heavily in favor of a
       small group of individuals, specifically five Officers and
       the COO/President, which should not be the case in any
       incentive plan allegedly intended to be used to retain a
       broad array of employees during the restructuring process;

    -- the Company Goals, Department Goals and Individual Goals,
       from which the achievement of these are basis for the
       incentive rewards, are not linked to the Debtor's
       profitable operating performance or successful emergence
       from Chapter 11; and

    -- it is not objectively, but subjectively structured
       and not geared to the Company Goals, which is not an
       appropriate incentive plan for a Chapter 11 Debtor.

The Committee objects to the 2003 Incentive Award Plan in its
entirety because:

    -- any granting of stock appreciation rights presents the
       potential for conflict of interest among those employees,
       officers and directors receiving it because the
       compensation is tied to the value of MAIR stock, as
       there are instances during the course of Chapter 11 Case
       when interests of the Debtor and those of MAIR are adverse;

    -- should both Northwest Airlines, Inc., and the Debtor
       successfully reorganize and MAIR retain its controlling
       interest in the Debtor, the stock appreciation rights
       granted while the Debtor's bankruptcy case is proceeding
       could provide a windfall to recipients of the award; and

    -- any incentive compensation to Officers and Directors of the
       Debtor should be linked to a successful reorganization or
       the sale of the Debtor's assets and creditor recoveries.

The Committee recognizes that every Chapter 11 Debtor faces
retention issues related to employee concerns over job security.
However, Mr. Robinson notes that the Debtor's current severance
plan is inappropriate because:

    -- it does not require employees to remain with the Debtor for
       the period between notification of severance and the
       effective date of severance in order to receive benefits;

    -- it provides an entire year's severance to employees with a
       short tenure with the Debtor, which is unjustifiable;

    -- it provides that the Officers of the Debtor will receive 52
       weeks' pay if their employment with the Debtor is
       terminated; and

    -- the Committee believes that the level of severance benefits
       provided to Officers of the Debtor should be linked to time
       of service.

                  Committee Proposes Modifications

The Committee proposes modifications to the Debtor's incentive
and severance programs.  The modifications, Mr. Robinson tells
the Court, seek to achieve several goals including:

    -- implementation of incentive and severance plans appropriate
       to a Chapter 11 Debtor;

    -- preservation of property of the estate;

    -- compensation incentives that are linked to operational
       performance benchmarks consistently applied across all
       labor groups; and

    -- proper emphasis on the Debtor's successful reorganization
       and maximization of creditor recoveries.

Regarding the Performance Incentive Compensation Plan, the
Committee proposes that:

    a. the Plan should be suspended in its entirety during the
       course of Mesaba's Chapter 11 Case and should be replaced
       with a Quarterly Incentive Plan;

    b. those salaried employees at the Director level and below
       will be eligible to receive potential incentive
       compensation under the Quarterly Incentive Plan in the same
       maximum amount as they could potentially receive under the
       Performance Incentive Compensation Plan; and

    c. a limited pool of cash, not to exceed $200,000, available
       for use at the Debtor's discretion for the retention of
       employees at the Manager level or below and for new hires
       to be distributed as determined by the plan administrator.

The Committee objects to the 2003 Incentive Award Plan in its
entirety and asks the Court to suspend the 2003 Incentive Award
Plan until the confirmation of a plan of reorganization or the
sale of the Debtor.

In addition, the Committee requests that any decision regarding
appropriate incentive compensation for Officers be deferred until
the Debtor develops a revised business plan and the Committee has
reviewed it.

With regard to the Severance Plan, the Committee recommends that,
with certain limited modifications, the current plan be honored
for ordinary course separations, with a limit of $2,000,000 on
total severance obligations that can be incurred by the Debtor in
the ordinary course.  In the event of any large-scale reductions
in force triggering obligations under the Severance Plan in
excess of $2,000,000, the Debtor should be required to seek Court
approval of any severance benefits incurred or paid.

Specifically, the Committee suggests these modifications to the
Severance Plan:

    1. Officers with less than 1 year of services receive
       severance based on months of service;

    2. No severance payments in the event that a terminated
       Officer is employed by a Mesaba affiliate post-termination;

    3. Elimination of benefits for employees initially eligible
       for benefits upon termination but who are later found to
       have engaged in improper or unethical conduct, and an
       obligation imposed on the Debtor to seek recovery of
       payments where that impropriety or unethical behavior was
       found following payment of severance; and

    4. No severance benefits paid to employees that voluntarily
       leave between the date of notice of termination and the
       separation date.

Mesaba Aviation, Inc., d/b/a Mesaba Airlines --
http://www.mesaba.com/-- operates as a Northwest Airlink     
affiliate under code-sharing agreements with Northwest Airlines.  
The Company filed for chapter 11 protection on Oct. 13, 2005
(Bankr. D. Minn. Case No. 05-39258).  Michael L. Meyer, Esq., at
Ravich Meyer Kirkman McGrath & Nauman PA, represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed total assets of $108,540,000 and
total debts of $87,000,000. (Mesaba Bankruptcy News, Issue No. 9;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


MIRANT CORP: Bankruptcy Court Appoints Three Plan Trustees
----------------------------------------------------------
Pursuant to Mirant Corporation and its debtor-affiliates' Plan of
Reorganization:

    (a) the equity interests in certain trading Debtors will be
        transferred to a Plan Trust after the distribution of the
        assets of the Trading Debtors to Mirant Energy Trading,
        LLC; and

    (b) the equity interests in Mirant will be issued to the Plan
        Trust after the transfer of the assets of Mirant to New
        Mirant and the cancellation of Mirant's original shares.

Michelle C. Campbell, Esq., at White & Case LLP, in Miami,
Florida, tells the Court the Debtors will appoint trustees to
administer the Plan Trust.  The Plan Trustees will have the duty
and authority to take all actions, including, but not limited to,
the retention of professionals, deemed by the Plan Trustees to be
necessary or appropriate:

    (a) to protect, maintain, liquidate to Cash, and maximize the
        value of, the Assets transferred to the Plan Trust,
        whether by litigation, settlement or otherwise; and

    (b) to prepare and make available to the holders of beneficial
        interests in the Plan Trust periodic reports regarding the
        results of the Plan Trust's operations.

Thus, the U.S. Bankruptcy Court for the Northern District of Texas
appointed Rivershore Advisors, LLC, Capital Asset Services, Inc.,
and Phoenix Advisors, LLC, as Plan Trustees, at the Debtors'
behest.

                    About Rivershore Advisors

Rivershore Advisors, LLC, is a management consulting practice
that specializes in advising debtors, lenders, trustees and
creditors on out-of-court restructurings and Chapter 11
bankruptcy proceedings and has been previously retained in
various fiduciary capacities, including as an officer, trustee,
plan administrator and disbursing agent.  

                      About Capital Assets

Capital Assets Services, Inc., has also worked extensively with
parties in bankruptcy proceedings, including serving as a
Disbursing/Liquidating Agent pursuant to a Chapter 11 plan for
Mulberry Phosphates, Inc., and River Village Associates.

                      About Phoenix Advisors

Phoenix Advisors has extensive experience in reorganizations and
restructurings.  It is currently involved in the reorganization
of the Singer Company, N.V., Valley Rivet Company and Mariner
Health Care and several of its affiliates.  Joseph Pardo, who was
previously selected as a Plan Trustee nominee, is president of
Phoenix Advisors.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue Nos. 89 & 90 Bankruptcy Creditors'
Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 8, 2005,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to power generator and developer Mirant Corp.  The
outlook is stable.  The rating reflects the credit profile of
Mirant, based on the structure the company expects to have on
emergence from bankruptcy at or around year-end 2005.


MIRANT CORP: Court Approves Canada Unit's Refinancing Agreement
---------------------------------------------------------------
The Honorable Michael D. Lynn of the U.S. Bankruptcy Court for the
Northern District of Texas:

     (i) approved a Reorganization and Refinancing Agreement
         between Mirant Canada Energy Marketing Investments,
        Inc., and Mirant Americas, Inc.;

    (ii) authorize MCEMII and Mirant Canada Energy Marketing,
         Ltd., to enter into transactions for the sale of the
         shares of Mirant Canada to certain outside investors; and

   (iii) waive, release and extinguish any and all claims by
         Mirant Canada against the Debtors.

MCEM is 100% owned by MCEMII, which is 100% owned by Mirant
Americas Energy Marketing Investments, Inc.  In turn, MAEMIII is
100% owned by Mirant Americas, which is 100% owned by Mirant
Corp.

Craig H. Averch, Esq., at White & Case LLP, in Miami, Florida,
reminded the Court that on April 15, 2004, the Bankruptcy Court
approved a Global Settlement Agreement between the Debtors and
Mirant Canada, which resolved substantially all of the third party
creditor issues with respect to the Debtors' Canadian assets.

Following the Global Settlement Agreement, the Debtors began
pursuing a sale of their equity interests in Mirant Canada.  The
Debtors intend to effectuate a sale of the shares of Mirant
Canada to certain investors to allow Mirant Canada to embark on a
new business to better utilize certain tax losses.

The Debtors believed that entering into the Reorganization and
Refinancing Agreement and the related transactions will result in
a maximization of the value of Mirant Canada.

Under the Reorganization and Refinancing Agreement, MCEMII will
undertake a private placement to the Investors of 923,000 common
shares and 8,077,000 common non-voting shares at CN$0.3729474 per
share, for gross proceeds of CN$3,356,527 or $2,800,000.

Mr. Averch noted that Mirant has required the Investors to place
the $2,800,000 funds in escrow pending Court approval of the
Agreement.

As part of the arrangement, MCEMII will reorganize its capital
structure and amalgamate with MCEM.

In relation to the Agreement, MCEM and MCEMII must:

   (a) unwind all remaining contracts;

   (b) close its bank accounts and transfer $4,800,000 to MAEMII;

   (c) make certain required amendments to MCEMII's corporate
       documents;

   (d) amalgamate MCEMII and MCEM to form one entity, MCEM2; and

   (e) take all steps necessary to cause the consolidation of the
       existing Common Shares, with the result that MAEMII will
       own 1,000,000 Common Shares of MCEM2 immediately prior to
       the transactions.

At Closing:

   (1) MCEM2 will issue 923,000 Common Shares to the Investors;

   (2) MCEM2 will issue 8,077,000 Non-Voting Shares to the
       Investors; and

   (3) MCEM2 will distribute approximately $2,800,000 to MAEMII
       in repayment of share capital.

Pursuant to the Agreement, Mirant Americas agrees to indemnify
MCEM from and against all losses to which MCEM may be subject or
may suffer or incur, arising from a breach of any representation
or warranty of Mirant Americas.  However, Mirant Americas'
liability for the losses is limited to $2,800,000 and 18 months
in duration.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 89 Bankruptcy Creditors'
Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 8, 2005,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to power generator and developer Mirant Corp.  The
outlook is stable.  The rating reflects the credit profile of
Mirant, based on the structure the company expects to have on
emergence from bankruptcy at or around year-end 2005.


MIRANT CORP: Wants Court to Okay D&O Indemnity Claims Protocol
--------------------------------------------------------------
Mirant Corporation and its debtor-affiliates incurred certain
prepetition obligations to indemnify and hold harmless current and
former directors, officers and employees, Jeff P. Prostok, Esq.,
at Forshey & Prostok, LLP, in Fort Worth, Texas, relates.

The New Mirant Entities, under their Plan of Reorganization,
assumed all obligations to indemnify and hold harmless the
Debtors' directors, officers and employees, whether arising under
constituent documents, contract, law or equity.

Five New York Debtors are still under reorganization -- Mirant
Bowline, LLC, Mirant Lovett, LLC, Mirant New York, Inc., Mirant
NY-Gen, LLC, and Hudson Valley Gas Corporation.  The New York
Debtors will also assume all obligations to indemnify and hold
harmless the Debtors' former and current directors, officers and
employees upon their emergence from Chapter 11.

Certain Employees and Officers have advised that they have
or may have indemnification claims, which may be entitled to
administrative priority, against the New Mirant Entities.  The
Employees asserted that their claims were incurred and payable in
the ordinary course of business and that they do not need to file
a notice of administrative claim prior to the January 24, 2006
deadline to file administrative claims.

Nevertheless, the Employees informed the New Mirant Entities that
some or all of them intend to file notices of administrative
claim prior to Administrative Claims Bar Date.

The New York Debtors anticipate that the Employees will take a
similar position against them.

As this time, some or all of the Indemnification Claims remain
contingent.  The New Mirant Entities and the New York Debtors
believe that many of these claims will never materialize.

To resolve the matter, the parties agree that:

   a. All current and former directors, officers and employees of
      the New Mirant Entities and the New York Debtors do not
      need to file a notice of Administrative Claim prior to the
      Administrative Claims Bar Date with respect to
      Indemnification claims;

   b. The failure of any current or former director, officer or
      employee of the New Mirant Entities or the New York Debtors
      to file a notice of Administrative Claim prior to the
      Administrative Bar Date will not have any effect on the
      validity, enforceability or priority of the
      indemnification claim; and

   c. All rights of the parties are reserved, including all
      rights with regard to a determination of  whether the
      Indemnification Claims are Administrative Claims.

The New Mirant Entities and the New York Debtors ask the U.S.
Bankruptcy Court for the Northern District of Texas to approve
their Stipulation with the Employees.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 91 Bankruptcy Creditors'
Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 8, 2005,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to power generator and developer Mirant Corp.  The
outlook is stable.  The rating reflects the credit profile of
Mirant, based on the structure the company expects to have on
emergence from bankruptcy at or around year-end 2005.


MUSICLAND HOLDING: U.S. Trustee Appoints 7-Member Creditors Panel
-----------------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, Deirdre A.
Martini, the U.S. Trustee for Region 2, appointed seven creditors
to serve on the Official Committee of Unsecured Creditors in
Musicland Holding Corp., and its debtor-affiliates' Chapter 11
cases:

    1. Deluxe Media Services, Inc.
       568 Atrium Drive
       Vernon Hills, IL 60061
       Tel: (201) 512-8757
       Attn: Curtis Roberts, Esq.

    2. Navarre Corporation
       7400 49th Avenue North
       New Hope, MN 55428
       Tel: (763) 971-2770
       Attn: Ryan F. Urness, Esq.

    3. Universal Studios Home Entertainment LLC
       100 Universal City Plaza 1440/6
       Universal City, CA 91608
       Tel: (818) 777-7601
       Attn: John Roussey, V.P. Credit Home Entertainment

    4. Ventura Distribution, Inc.
       2590 Conejo Spectrum Street
       Thousand Oaks, CA 91320
       Tel: (805) 498-7800
       Attn: William P. Clark

    5. Fender Musical Instruments Corporation
       8860 E. Chaparral Road, Suite 100
       Scottsdale, Arizona 85250-2610
       Tel: (480) 5696-7127
       Attn: Mark Van Vleet, Secretary and General Counsel

    6. Electronics Arts
       290 Redwood Shores Parkway
       Redwood City, CA 94065
       Tel: (650) 628-7304
       Attn: Norma Cash, Director, Shared Services

    7. Simon Property Group, LP
       115 W. Washington Street
       Indianapolis, IN 46204
       Tel: (317) 263-2346
       Attn: Ronald M. Tucker, Esq., VP/Bankruptcy Counsel

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense.  They may investigate the Debtors' business and financial
affairs.

Importantly, official committees serve as fiduciaries to the
general population of creditors they represent.  Those committees
will also attempt to negotiate the terms of a consensual chapter
11 plan -- almost always subject to the terms of strict
confidentiality agreements with the Debtors and other core
parties-in-interest.  If negotiations break down, the Committee
may ask the Bankruptcy Court to replace management with an
independent trustee.  If the Committee concludes reorganization of
the Debtors is impossible, the Committee will urge the Bankruptcy
Court to convert the Chapter 11 cases to a liquidation proceeding.

Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.  (Musicland Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


MUSICLAND HOLDING: Gets Interim Okay to Invest and Deposit Funds
----------------------------------------------------------------
Musicland Holding Corp. and its debtor-affiliates currently
maintain an inactive investment account with Wells Fargo Bank.  
At present, they are not investing excess cash.  Prior to the
Petition Date, however, the Debtors have invested excess cash in
the investment account.

The Debtors seek the U.S. Bankruptcy Court for the Southern
District of New York's permission to invest excess cash in
accordance with their prepetition practices in the investment
account.

According to the Debtors' internal investment policies, the
investment account may only invest in these types of securities:

    -- overnight repurchase agreements;

    -- debt instruments issued by the Federal National Mortgage
       Association or the Federal Home Mortgage Corporation with a
       rating of P1/A1;

    -- asset-backed floating rate securities or corporate floating
       rate note with a rating of Aaa/AAA;

    -- domestic time deposits/negotiable certificates of deposit
       or money market securities;

    -- domestic commercial paper with a rating of A1/P1; and

    -- money market mutual funds that invest in securities
       approved under the Debtors' policy.

Section 345(a) of the Bankruptcy Code authorizes deposits or
investments of money in a manner that will "yield the maximum
reasonable net return on such money, taking into account the
safety of such deposit or investment."  For deposits or
investments that are not "insured or guaranteed by the United
States or by a department, agency or instrumentality of the
United States or backed by the full faith and credit of the
United States," Section 345(b) provides that the estate must
require from the entity with which the money is deposited or
invested a bond in favor of the United States secured by the
undertaking of an adequate corporate surety.

According to James H.M. Sprayregen, Esq., at Kirkland & Ellis
LLP, in New York, the investment account provides sufficient
protection for the Debtors' cash.  Moreover, a bond secured by
undertaking of a corporate surety would likely be too expensive
and could offset much of the financial gain derived from the
investment accounts.

Mr. Sprayregen says that the Debtors' assets will be invested in a
manner that preserves capital, provides liquidity, maintains
appropriate diversifications and generates returns relative to
prevailing market conditions.

If granted a waiver, the Debtors will not be required to incur the
administrative difficulties and expenses in opening new accounts
to ensure that all of its funds are fully insured or invested
strictly in accordance with the restrictions established by
Section 345 of the Bankruptcy Code.

                           *     *     *

Judge Bernstein authorizes the Debtors, on an interim basis, to
invest and deposit funds in the Investment Account, in accordance
with their prepetition practices, although that practice may not
strictly comply with the requirements of Section 345 of the
Bankruptcy Code.

Judge Bernstein also excuses the entities with which the Debtors'
money is invested from compliance with the requirements of
Section 345(b).

Judge Bernstein allows, on an interim basis, all applicable banks
and other financial institutions to accept and hold or invest
funds, at the Debtors' direction, in accordance with the Debtors'
prepetition investment practices.

The Court will convene a final hearing on the continuation of the
Debtors' prepetition investment practices on January 27, 2006, at
10:00 a.m. prevailing Eastern Time.

Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.  (Musicland Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


MUSICLAND HOLDING: Morgan Lewis Represents Trade Vendors Committee
------------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy
Procedure, Michael A. Bloom, Esq., at Morgan, Lewis & Bockius,
LLP, discloses that since June 2003, his firm has represented an
informal Committee of Secured Trade Vendors of Musicland Holding
Corp. and its debtor-affiliates:

    * Twentieth Century Fox Home Entertainment LLC
    * Warner Home Video Inc.
    * Sony BMG Music Distribution
    * Warner/Elektra/Atlantic Corp.
    * Universal Music and Video Distribution
    * Sony Pictures Home Entertainment, Inc.
    * Paramount Pictures, Home Video Division
    * Ingram Book Group Inc.
    * Buena Vista Home Entertainment, Inc.
    * EMI Recorded Music, North America
    * V.P.D. IV, Inc.

According to Mr. Bloom, the Informal Committee has elected Robert
Baker of Warner/Elektra/Atlantic Corporation, and Kathy Clark of
Buena Vista Home Entertainment, Inc., to act as co-chairs.

Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.  (Musicland Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


NEW GENERATION: Files 1st, 2nd & 3rd Quarter 2005 Financials
------------------------------------------------------------
New Generation Holdings Inc. (Pink Sheets:NGPX) says it's now
current with all of its required SEC filings.

The company's independent auditors recently completed the audit
for the year ended December 31, 2004 and the company filed its
quarterly reports for the periods ended March 31, 2005, June 30,
2005 and September 30, 2005, on January 23, 2006.

                  Quarter Ended March 31, 2005

At Mar. 31, 2005, the company generated no cash flow from
operations and had a working capital deficit of $1,658,115.  
The company discloses that it received $546,768 in the form of
subscriptions in connection with the private placement of its
restricted common stock.

For the quarter ended Mar. 31, 2005, the company had $2,957 in
assets and $1,661,072 in liabilities resulting in a stockholders'
deficit of $1,658,115.

For the quarter ended Mar. 31, 2005, the company incurred a net
loss of $589,840 compared to a net loss of $109,127 for the
quarter ended Mar. 31, 2004.

A full-text copy of the company's Form 10-Q for the quarter ended
Mar. 31, 2005 is available at no charge at
http://ResearchArchives.com/t/s?496

                   Quarter Ended June 30, 2005

At June 30, 2005, the company generated no cash flow from
operations and had a working capital deficit of $1,754,408.  
However, the company relates, it received $719,200 (after giving
effect to exchange rates) in the form of subscriptions in
connection with the private placement of its restricted common
stock.

For the quarter ended June 30, 2005, the company had $1,842 in
assets and $1,756,330 in liabilities resulting in a stockholders'
deficit of $1,754,488.

For the quarter ended June 30, 2005, the company incurred a net
loss of $247,217 compared to a net loss of $181,100 for the
quarter ended June 30, 2004.

A full-text copy of the company's Form 10-Q for the quarter ended
June 30, 2005 is available at no charge at
http://ResearchArchives.com/t/s?495

               Quarter Ended September 30, 2005

At Sept. 30, 2005, the company generated no cash flow from
operations and had a working capital deficit of $1,509,989.  The
company reported that during the nine month period ended Sept. 30,
2005, the company received $1,652,115 (after giving effect to
exchange rates) in the form of subscriptions in connection with
the private placement of its restricted common stock.

For the quarter ended Sept. 30, 2005, the company had $148,065 in
assets and $1,658,054 in liabilities resulting in a stockholders'
deficit of $1,509,989.

For the quarter ended Sept. 30, 2005, the company incurred a net
loss of $691,628 compared to a net loss of $198,714 for the
quarter ended Sept. 30, 2004.

A full-text copy of the company's Form 10-Q for the quarter ended
Sept. 30, 2005 is available at no charge at
http://ResearchArchives.com/t/s?494

                     Going Concern Doubt

Russell Bedford Stefanou Mirchandani LLP expressed substantial
doubt about New Generation's ability to continue as a going
concern after it audited the company's financial statement for the
fiscal year ended Dec. 31, 2004.  The auditing firm points to the
company's recurring losses from operations.

The auditing firm's New York office can reached at:

         Russell Bedford Stefanou Mirchandani LLP
         5 West 37th Street
         9th Floor
         New York, New York 10018
         Tel: (212) 868-3669
         Fax: (212) 868-3498
         http://www.rbsmllp.com/

New Generation Holdings, Inc. -- http://www.ngpx.com/-- was  
formed in 1999 as a platform to build shareholder value through
the acquisition and development of technologies or businesses that
are sound, but need managerial and financial assistance to realize
their full potential.  The company is active in the software
development sector through its wholly owned subsidiary, Minerva
Softcare NV and in the plastic blending sector, through its wholly
owned subsidiary, New Generation Plastic, Inc.


NOBLE DREW: Panel Calls for Termination of Exclusive Periods
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Noble Drew Ali
Plaza Housing Corp. criticized the Debtor's failure to formulate a
consensual plan of reorganization ten months into its bankruptcy
and wants the Debtor's exclusivity terminated so that other
parties-in-interest can propose a plan that would result in real
distributions for creditors.

For these reasons, the Committee asks the U.S. Bankruptcy Court
for the Southern District of New York to deny the Debtor's second
motion to extend its exclusive plan filing deadline to Feb. 20,
2006.

Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, tells the
Bankruptcy Court that the Debtor's ability to formulate a feasible
plan continues to deteriorate in view of dwindling occupancy at
the Noble Drew Ali Plaza Housing Plaza as well as disrepair,
rising crime and lack of security at these facilities.  The Plaza,
located in Brooklyn, is the Debtor's primary asset.  The apartment
complex consists of five buildings with 385 federally subsidized
rent-stabilized apartments.

Mr. Bunin points out that the City of New York and Women in Need,
Inc., which respectively fund and operate Tier II homeless
shelters, are terminating their homeless programs in two of the
Debtor's five buildings effective January 2006.

Mr. Bunin says that New York and Women in Need's departure will
severely cripple the Debtor's ability to obtain financing and
propose a plan since the two institutions have contributed
approximately 60% of the Debtor's postpetition revenues.

Mimi Rosenberg, Esq., the Legal Aid Society attorney for the Noble
Drew Ali Plaza Tenant's Association submitted an affidavit in
support of the Committee's motion to end the Debtor's exclusivity.  
A copy of the nine-page affidavit is available for a fee at:

   http://www.researcharchives.com/bin/download?id=060125032126

Headquartered in Brooklyn, New York, Noble Drew Ali Plaza Housing
Corp., filed for chapter 11 protection on March 25, 2005 (Bankr.
S.D.N.Y. Case No. 05-11915).  Gerard R. Luckman, Esq., at
Silverman Perlstein & Acampora, LLP, represents the Debtor.  When
the Debtor filed for protection from its creditors, it listed
total assets of $43,500,000 and total debts of $18,639,981.


NORTHWEST AIR: Retiree's Balk at Move to Modify Medical Benefits
----------------------------------------------------------------
As previously reported in the Troubled Company Reporter, Northwest
Airlines Corp. and its debtor-affiliates presented a proposal to
modify retiree medical benefits to the Official Committee of
Retired Employees on December 9, 2005.  The Proposal calls for
reductions in retiree medical benefits for current retirees that
will generate $25,400,000 in annual savings on a cash basis.

                  Retiree Committee Objects

The Official Committee of Retired Employees asks the Hon. Allan L.
Gropper of the U.S. Bankruptcy Court for the Southern District of
New York to strike the Debtors' request because they failed to:

   (1) make a proposal that satisfies Section 1114(f)(1)(A) of
       the Bankruptcy Code; and

   (2) provide the Retiree Committee with all the information it
       would require to evaluate the proposal made.

Catherine L. Steege, Esq., at Jenner & Block LLP, in Chicago,
Illinois, relates that the Debtors' attempt to diminish the
benefits of their current retirees must be evaluated pursuant to
Section 1114, separately and distinctly from their application to
modify wages, work rules and the benefits of their current
employee and future retirees -- which is an effort governed by
Section 1113 of the Bankruptcy Code -- regardless of the nominal
similarities between the abstract legal standards governing those
efforts.

Ms. Steege contends that the absence of any need of the Debtors
to erode the health coverage of their current retirees, and the
equities of any change they currently contemplate, both call on
the Court to require them to continue honoring the commitments
they made to care for their retired employees.

The savings contemplated to be realized by slashing the medical
benefits of already retired employees pale in comparison to the
savings to be realized with respect to current employees, Ms.
Steege argues.

In addition, the Debtors' effort to impose unilateral and
permanent reductions to the medical benefits of their retirees
fails to satisfy four more requirements in Section 1114 in that:

   (1) the proposed reductions in benefits are not "necessary to
       permit [the Debtors'] reorganization;"

   (2) the proposed reductions do not treat all affected parties
       fairly and equitably;

   (3) the proposal is not "clearly favored by the balance of the
       equities;" and

   (4) the Debtors are not negotiating in good faith, giving the
       retirees "good cause" for rejecting any modifications.

The record establishes that the Debtors ultimately cannot bear
their burden of making an affirmative case with respect to each
one of these requirements, Ms. Steege says.

While Sections 1113 and 1114 share many legal standards, critical
differences exist in the commercial context in which they are
applied.  Ms. Steege points out that differences between
collective-bargaining agreements and retiree benefits may -- and
in this case do -- dictate different results from applying the
shared principles.

Ms. Steege adds that whatever the merits of the Debtors' effort
to reject their collective bargaining agreements with their
current employees and future retirees, there is no justification
for the diminution of medical benefits that the Debtors want the
Court to impose on their retirees.

                         Debtors Respond

Bruce R. Zirinsky, Esq., at Cadwalader, Wickersham & Taft LLP, in
New York, argues that the Debtors have fully complied with their
obligations under Section 1114.

Mr. Zirinsky warns Judge Gropper that the Retiree Committee's
opposition is its latest move to avoid its duty to engage with
the Debtors on the substantive issues.  The Retiree Committee's
efforts have been devoted wholly to delay, and not at all to
addressing the Debtors' proposal.

Mr. Zirinsky tells the Court that during this time, the Debtors
provided the Retiree Committee with access to their data, and
that they remain willing to negotiate about all aspects of the
proposal, and continue to make their employees and professionals
available to the Retiree Committee.

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


NORTHWEST AIR: Retiree Committee Hires Jenner & Block as Counsel
----------------------------------------------------------------
The Section 1114 Committee of Retired Employees of Northwest
Airlines Corp. and its debtor-affiliates sought and obtained
authority from the U.S. Bankruptcy Court for the Southern District
of New York's to retain Jenner & Block LLP as its counsel
effective as of Dec. 5, 2005.

The Retiree Committee needs Jenner & Block to:

   (a) provide assistance, advice and representation concerning
       any proposed modification of the benefits to be provided
       to the Retirees;

   (b) negotiate with the Debtors concerning any proposed
       modification of the Retirees' benefits in general;

   (c) represent the Committee in any proceedings and hearings
       that involve or might involve matters pertaining to
       Retiree benefits;

   (d) prepare on the Committee's behalf any necessary adversary
       complaints, motions, applications, orders and other legal
       papers relating to those matters;

   (e) advise the Committee of its powers and duties;

   (f) prosecute and defending litigation matters and other
       matters concerning any proposed modification of the
       Retirees' medical benefits, or the Retirees' benefits in
       general, that might arise;

   (g) advise the Retiree Committee with respect to bankruptcy,
       general corporate, labor, employee benefits and litigation
       issues concerning any proposed modification of the
       Retirees' medical benefits, or the Retirees' benefits in
       general; and

   (h) perform other legal services as may be necessary and
       appropriate for the efficient and economical resolution of
       the Retiree Committee's consideration of any proposal to
       modify the Retirees' benefits.

The Retiree Committee notes that the scope of Jenner & Block's
representation may be expanded to include certain matters to
protect the Retirees' rights.

Jenner & Block will be paid at these rates:

         General Range of Rates
         ----------------------

              Professional                   Hourly Rates
              ------------                   ------------
              Partners                        $410 - $800
              Associates                      $230 - $395
              Paralegals                      $160 - $225
              Project Assistants              $120 - $130

         Professionals Expected to Be Most Active
         ----------------------------------------

              Partners                       Hourly Rates
              --------                       ------------
              Catherine L. Steege                 $565
              Charles B. Sklarsky                 $585
              Seth A. Travis                      $450
              Jacob I. Corre                      $435

              Associate
              ---------
              Andrew S. Nicoll                    $250

              Paralegal
              ---------
              Michael Matlock                     $225

The Retiree Committee believes that Jenner & Block is well
qualified to represent it in the Debtors' Chapter 11 cases.
Jenner & Block has represented the Section 1114 committee of non-
unionized retirees in United Airlines, Inc.'s bankruptcy case.

Catherine L. Steege, a partner at Jenner & Block, assures the
Court that neither Jenner & Block nor any of its partner or
associate:

   (a) represent any interest adverse to that of the Retiree
       Committee;

   (b) have any connection with the Debtors or any parties-in-
       interest in the Debtors' cases;

   (c) have an interest materially adverse to that of the
       estate or of any class of creditors or equity security
       holders, by reason of any direct or indirect relationship
       to, connection with, or interest in, the Debtors.

Ms. Steege discloses that Jenner & Block represented Honeywell
International, Inc., in the Debtors' case.  The Retiree Committee
has been informed of this representation, and has given its
consent notwithstanding Jenner & Block's prior and continuing
representation of Honeywell in the Debtors' Chapter 11 cases.

Ms. Steege relates that beginning in 1985, Jenner & Block has
intermittently represented Northwest Airlines, Inc., in
connection with various litigation and transactional matters.
Jenner & Block has never represented Northwest Airlines in any
matters relating to its insolvency or its retiree benefits, and
currently is not representing Northwest Airlines in any matters.
Jenner & Block's prior representation of Northwest Airlines does
not constitute a conflict with its representation of the Retiree
Committee, Ms. Steege maintains.

Jenner & Block has represented or is currently representing
certain parties-in-interest in matters unrelated to the Debtors'
cases:

   -- Current Clients:

      (a) Blue Cross Blue Shield Association;
      (b) Chase Insurance;
      (c) Kemper Insurance Company;
      (d) Sabre Inc.;
      (e) Honeywell Corporation;
      (f) General Electric Co.;
      (g) ACS State and Local Solutions, Inc.; and
      (h) AT&T; and

   -- Former Clients:

      (a) State Street Bank;
      (b) United Healthcare Corporation;
      (c) Galileo International, Inc.;
      (d) Travelocity.com;
      (e) CIT Group/Credit Finance, Inc.;
      (f) Amtech Corporation;
      (g) Globe Ground North America, LLC; and
      (i) CIGNA

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


PLYMOUTH RUBBER: Four Creditors Want Exclusive Period Terminated
----------------------------------------------------------------
LaSalle Bank National Association, General Electric Capital
Corporation, TD BankNorth National Association and the Pension
Benefit Guaranty Corporation, collectively called the Moving
Creditors, ask the U.S. Bankruptcy Court for the District of
Massachusetts to terminate Plymouth Rubber Company, Inc., and its
debtor-affiliate's exclusive right to file a chapter 11 plan and
solicit acceptances of that plan from their creditors.

The Debtors filed a Plan of Reorganization and an accompanying
Disclosure Statement on Dec. 30, 2005.  The Court has yet to
schedule a hearing to approve the Disclosure Statement.

                  An Insider Chapter 11 Plan

Maurice J. Hamilburg, President and Co-Chief Executive Officer of
PRC, and Joseph D. Hamilburg, Chairman and Co-Chief Executive
Officer of PRC, are insiders of the Debtors.  These two officers
control more than 50% of PRC's Class A voting stock.  They also
own a significant amount of PRC's Class B nonvoting stock. PRC in
turn, holds 100% of the stock of Brite-Line Technologies, Inc., an
affiliate of PRC.

The Moving Creditors believe that the Debtors' proposed Plan is an
insider chapter 11 plan that contains questionable and unfair
provisions and the plan is not confirmable.

The Moving Creditors reasons for rejecting the Plan are:

   1) the ability of the Moving Creditors to receive principal
      payments on account of their respective claims is dependent
      upon their reaching of a unanimous agreement on their claims
      and the Plan stays until 2010 any judicial resolution if
      they are unable to agree on a unanimous agreement;

   2) the Plan was not proposed in good faith, it violates
      applicable law, it is not feasible and each of the Moving
      Creditors will reject the Plan;

   3) PRC's Class A and Class B shareholders will retain their
      equity interests in PRC, and it will also retain its 100%
      equity interest in Brite-Line, in which its interest is
      unimpaired under the Plan;

   4) the Debtors will issue an unknown amount of additional
      convertible preferred stock of PRC and the Plan contains no
      provisions to market or otherwise price the retained equity
      interests or the preferred stock of PRC;

   5) the Plan contains no provisions regarding the purchase price
      of the Debtors' assets or equity interests or permitting the
      filing of a competing chapter 11 plan; and

   6) the Plan impairs the claims of the Moving Creditors and it
      impairs the claims of the Debtors' general unsecured
      creditors.

The Moving Creditors relate that the Debtors' actions with regards
to their chapter 11 cases demonstrate that they are acting in the
best interests of their current controlling equity holders
and not in the best interests of their creditors.

The Court will convene a hearing at 10:30 a.m., on March 14, 2006,
to consider the four Creditors' request.

Headquartered in Canton, Massachusetts, Plymouth Rubber, Inc.,
manufactures and distributes plastic and rubber products,
including automotive tapes, insulating tapes, and other industrial
tapes, mastics and films.  Through its Brite-Line Technologies
subsidiary, Plymouth manufactures and supplies highway marking
products.  The Company and its subsidiary filed for chapter 11
protection on July 5, 2005 (Bankr. D. Mass. Case Nos. 05-16088
through 05-16089).  Victor Bass, Esq., at Burns & Levinson LLP,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
$10 million to $50 million in assets and debts.


SCIENTIFIC GAMES: Moody's Affirms Low-B Sr. & Sub. Debt Ratings
---------------------------------------------------------------
Moody's Investors Service affirmed Scientific Games Corporate
Family, senior and subordinated ratings at Ba2, Ba2 and B1,
respectively, following recent announcements that the company
reached agreement to acquire the online lottery assets of EssNet
AB for $60 million and signed a non-binding letter of intent to
acquire The Global Draw, Ltd. and related companies for about $183
million, plus an earn-out that will paid depending on future
financial performance.

The transactions are expected to be financed with borrowings under
the company's revolving credit facility and new debt.  The
affirmation of the company's ratings reflect reasonable purchase
prices, Moody's expectation that both acquisitions will be
accretive to earnings, and the transactions will be financed in a
manner that maintains sufficient revolving credit availability to
support operations.  As of Sept. 30, 2005, the company had about
$219 million of availability under its $250 million revolver and
$66 million of cash.  The acquired assets of EssNet will enhance
the company's position in Europe, particularly in Germany.  Global
Draw is a supplier of fixed odds betting terminals and systems in
the UK and is expected to provide Scientific Games with a platform
to expand its presence in sports betting and video lottery.

The ratings anticipated acquisitions and temporary increases in
leverage.  Moody's estimates that company's pro-forma debt to
trailing twelve month EBITDA could rise to 3.5(x).  This level is
near the high end of the acceptable range for the current rating
category, and so more debt financed acquisitions in the near term
could place downward pressure on the company's ratings.
Nevertheless, the rating outlook is stable reflecting Moody's
expectation that the company will be able to improve its leverage
ratio to around 3.0(x) through earnings growth in 2006.

Scientific Games Corp. is a provider of services, systems and
products to both the instant ticket lottery industry and pari-
mutuel wagering industry.  The company currently operates in four
business segments:

   * Lottery Group,
   * Pari-mutuel Group,
   * Venue Management Group, and
   * Telecommunications Products Group.

Revenues for the latest twelve-month period ended Sept. 30, 2005
were approximately $761 million.


SEDGWICK CMS: Moody's Rates $340 Million Credit Facility at B1
--------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to the $340 million
senior secured credit facility expected to be entered into by
Sedgwick CMS Holdings, Inc.  The credit facility consists of:

   * a $300 million senior secured term loan (Term Loan B); and
   * a $40 million revolving credit facility.

Proceeds from the facility are to be used to partially finance the
acquisition of Sedgwick by Fidelity National Financial, Inc.
(NYSE: FNF).

The B1 rating is based primarily on the highly leveraged nature of
the transaction which will result in debt-to-EBITDA of
approximately 5x.  Financial leverage is offset to a degree by:

   * Sedgwick's status as a market leader in the claims management
     sector;

   * its strong historic organic revenue growth;

   * its diverse customer base, product line and geographic
     spread; and

   * its relatively stable cost structure.

Additional risks to the company's credit profile include:

   * aggressive growth plans;

   * potential disruptions to operations or increased personnel
     turnover due to the ownership change; and

   * a highly competitive operating environment.

At its current rating level, Moody's expects Sedgwick to maintain
its:

   * debt-to-EBITDA ratio at approximately 5x or less;
   * debt-to-free cash flow coverage of between 8% and 14%; and
   * interest coverage above 2x.

Sedgwick CMS Holdings, Inc. is the holding company for Sedgwick
Claims Management Services, Inc.  Sedgwick is headquartered in
Memphis, Tennessee, and is a market leader in insurance claims
management services.  For 2005, revenue is expected to be
approximately $400 million.


SENIOR HOUSING: Mass. Court Orders HealthSouth to Pay Profits
-------------------------------------------------------------
The Massachusetts Superior Court ordered HealthSouth Corporation
to pay Senior Housing Properties Trust (NYSE: SNH) the profits
earned since October 2004 from the operations of two hospitals
owned by Senior Housing.  

The same court order also directs HealthSouth to cooperate in the
transfer of its tenancy to a new operating company, which may be
selected by SNH.

In January 2002, SNH entered an amended lease with HealthSouth.  
In March 2003, the SEC accused HealthSouth and several of its
officers of fraudulent financial reporting.  Since then at least
17 senior officers of HealthSouth have been convicted of or pled
guilty to various crimes.  In October 2004, after failed efforts
to reach a settlement and because HealthSouth continued to
withhold financial information required under the lease, SNH
terminated HealthSouth's lease.  In November 2004, HealthSouth
sued SNH to prevent the lease termination.  As previously reported
in September 2005, the trial court ruled that SNH's lease
termination was proper.  

The ruling is a follow up court decision, which directs
HealthSouth to account to SNH for all profits which it earned and
earns from the hospitals until a new tenant selected by SNH
replaces HealthSouth. The court order allows HealthSouth to retain
an administrative services fee as defined by the court until a new
tenant is installed.

Based upon evidence submitted by HealthSouth during the court
proceedings, SNH believes these leased hospitals are operating
profitably and that the payments to be received from HealthSouth
may be material.  However, SNH does not yet have a complete
accounting from HealthSouth and the profits from the hospitals
operations may be subject to taxes.  Accordingly, SNH is not able
to estimate the net amounts it will receive from HealthSouth at
this time.

The court order also allows SNH to seek recovery of its legal fees
for this litigation, which was commenced by HealthSouth.  SNH
intends to file a motion for the fees, but the final amount, which
may be awarded by the court cannot be estimated at this time.

Senior Housing Properties Trust is a real estate investment trust,
or REIT, which invests in senior housing properties, including
apartment buildings for aged residents, independent living
properties, assisted living facilities and nursing homes.

                         *     *     *

As reported in the Troubled Company Reporter on June 16, 2005,
Fitch Ratings has affirmed the 'BB+' senior unsecured debt rating
of Senior Housing Properties Trust.  Fitch also affirms the 'BB-'
rating of trust preferred securities issued by SNH Capital Trust
I, a wholly owned financing subsidiary of SNH.  Fitch said the
outlook remains stable.


SENSE TECHNOLOGIES: Posts $367K Net Loss in Quarter Ended Nov. 30
-----------------------------------------------------------------
Grand Island, Nebraska-based Sense Technologies, Inc., incurred a
$367,637 net loss for the quarter ended Nov. 30, 2005, in contrast
to a $56,742 net loss for the comparable period in 2004.  

The Company generated $7,128 of sales during the quarter ended
Nov. 30, 2005, versus $6,608 of sales for the quarter ended Nov.
30, 2004.

Direct costs during the quarter were $55,612, a 144% increase over
the period ended Nov. 30, 2004.  The cost includes $48,475 of
expensed research and development costs.

At Nov. 30, 2005, Sense Technologies' balance sheet showed
$1,177,470 in total assets and liabilities of $1,485,976.  The
Company had a $529,365 working capital deficit at Nov. 30, 2005,
compared to a $1,015,283 working capital deficit at Nov. 30, 2004.

The decrease in working capital deficit is attributed to
additional financing and the increase in ScopeOut(R) product line
inventories.  ScopeOut (R) is a system of specially-designed
mirrors placed at specific points on automobiles to offer drivers
a more complete view behind the vehicle.

                    Going Concern Doubt

Amisano Hanson expressed substantial doubt about Sense
Technologies' ability to continue as a going concern after it
audited the Company's financial statements for the fiscal years
ended Feb. 28, 2005 and Feb. 29, 2004.  The auditing firm pointed
to the Company's failure to achieve profitable operations and
working capital and accumulated deficits at Feb. 28, 2005.

The Company's auditors can be reached at:

       Amisano Hanson
       604 - 750 West Pender St.
       Vancouver, British Columbia
       Phone: (604) 689-0188

                About Sense Technologies

Sense Technologies, Inc. -- http://www.senseme.com/-- holds an  
exclusive license to manufacture, distribute, market and
sublicense world-wide, a patented technology used to produce the
Guardian Alert backing awareness system for motor vehicles
utilizing microwave radar technology, as well as a patented
technology which is used to produce the ScopeOut adjustable
mirrors system for improved backing awareness.


TIDEL TECH: Selling Cash Security Biz to Sentinel for $17.5M
------------------------------------------------------------
Tidel Technologies, Inc. (Other OTC: ATMS.PK), has executed an
asset purchase agreement with Sentinel Operating, L.P., a
management buyout group led by Mark Levenick, Interim CEO and
director, and Raymond Landry, a Company director of Tidel, for the
sale of the assets of Tidel's cash security business for a
purchase price of $17.5 million, subject to adjustment as provided
in the agreement.

The asset purchase agreement is subject to customary
representations and warranties, covenants and the satisfaction of
several customary closing conditions, including approval by the
Company's stockholders.  The transaction is expected to close this
quarter.  After closing, the Company will no longer have any
operations.  The Company understands that its lender, Laurus
Master Fund, Ltd., or its affiliates may provide financing to the
purchaser, Sentinel Operating, L.P., in connection with the asset
sale.

The sale was negotiated on behalf of the Company by its two
independent directors who were unaffiliated with the transaction.
The unaffiliated directors also received an opinion from the
investment advisory firm of Capitalink, L.C. that the transaction
was fair from a financial point of view.

           Conversion and Repayment of Debt to Laurus

Concurrently with the asset sale, the Company entered into an
exercise and conversion agreement with Laurus, whereby Laurus
converted $5.4 million of the Company's convertible debt into
18 million shares of common stock, bringing its ownership to
19.251 million shares, or 49.8%, of the Company's outstanding
common stock.

In addition, the Company's repaid all of its remaining
indebtedness to Laurus in the amount of approximately
$2.8 million, including accrued interest and prepayment fees, from
a cash collateral account established by the Company for the
benefit of Laurus at the closing of the sale of the Company's ATM
business assets on January 3, 2006.  

The remaining balance of the cash collateral account of
$5.4 million will be held by Laurus until the closing of the sale
of the cash security business assets, at which time it will be
released to the Company.  If the asset sale doesn't close by
March 31, 2006, however, the Company has agreed to redeem the
18 million shares from Laurus for a price of $5.4 million, which
would be paid from the cash collateral account.

        Reorganization Fee and Repurchase of Laurus Stock

Upon closing of the asset sale, the Company will pay a
reorganization fee to Laurus pursuant to Section 4 of the
Agreement Regarding NCR Transaction and Other Asset Sales dated
November 26, 2004, which is estimated to be in the range of
$5 million to $11 million.

In addition, the Company entered into a stock redemption agreement
with Laurus whereby upon closing of the asset sale, the Company
will repurchase Laurus' 19.251 million shares of the Company's
common stock at a price of not less than $.20 per share nor
greater than $.34 per share, following the determination of the
Company's assets in accordance with the formula set forth in the
stock redemption agreement.  Laurus has also agreed to terminate
all of its warrants to purchase 4.75 million shares of the
Company's common stock upon the redemption.  Following the
Company's payment of the reorganization fee and the stock
redemption amount, Laurus will cease to own any equity interest in
the Company, and the Company will have no further obligations to
Laurus.  Based on the common stock outstanding of 38,677,210
shares, the Company expects to have 19,426,210 shares of common
stock outstanding following the repurchase of Laurus' shares.

Tidel Technologies, Inc. (Other OTC: ATMS.PK) --
http://www.tidel.com/-- manufacturers cash security equipment   
designed for specialty retail marketers.

                         *     *     *

                       Going Concern Doubt

Hein & Associates LLP expressed substantial doubt about Tidel
Technologies, Inc.'s ability to continue as a going concern after
it audited the Company's financial statements for the fiscal years
ended Sept. 30, 2005 and 2004.  The auditing firm pointed to the
Company's recurring losses from operations and accumulated deficit
as of Sept. 30, 2005.


UAL CORPORATION: New Shares to be Listed on NASDAQ Stock Market
---------------------------------------------------------------
UAL Corporation, the holding company whose primary subsidiary is
United Airlines, selected The NASDAQ Stock Market to list its new
stock issue, which will trade under the ticker symbol "UAUA"
beginning in early February.

The company said that it had received an overwhelmingly positive
response to the syndication of its $3 billion exit financing
facility, led by JPMorgan Chase and Citigroup Global Markets.

"We are very pleased with our selection of NASDAQ for the listing
of our new UAL shares," said Glenn F. Tilton, chairman, president
and CEO.  "United has made fundamental and sustainable
improvements in our operations, cost structure and revenue
strategy.  We are already competing successfully with the other
leading carriers, and will strengthen that position through
continuing operational improvements and differentiation based on
customer needs in the marketplace."

"The tremendous response to our exit financing from the lenders'
syndicate attests to what United and our people are
accomplishing," said Tilton.  "As we look to our future as a
publicly traded company, we concluded that NASDAQ, with its cadre
of dynamic companies, state-of the-art electronic trading platform
and focus on first-rate customer service, was a natural fit for
us."

"United is one of the world's premier brands and is repositioned
as a leader in its industry," said Robert Greifeld, NASDAQ
president and CEO.  "NASDAQ is the home of category-defining
companies across all industries and we are delighted that United
has decided to join our market.  We look forward to serving United
and its investors with our superior trading experience."

The company expects to exit bankruptcy formally and begin trading
in early February, following the U.S. Bankruptcy Court for the
Northern District of Illinois' approval of its Plan of
Reorganization last Jan. 20, 2006.

Separately, United reported that it received offers of
subscription for more than twice the capital necessary to support
the $3 billion in exit financing that it sought, which consists of
a $2.8 billion term loan and a $200 million revolving credit line.
Because of this response, terms of the financing improved to
reduce the financing cost of the facility by 75 basis points to
375 basis points over the London interbank offered rate.

"Response to syndication of our exit facility is yet another
validation of the substantial and sustainable improvements made
during our restructuring," said Jake Brace, executive vice
president and chief financial officer.

James B. Lee, vice chairman of JPMorgan Chase, said, "As it
completes the restructuring, United has proven itself to be
attractive to a wide range of institutional lenders.  This is the
largest exit financing ever raised in the loan market and is well
oversubscribed, a strong sign of lender confidence."

Under its Plan of Reorganization, UAL Corporation will begin to
issue up to 125 million shares of common stock in early February.  
Most shares will go to the company's former unsecured creditors.

Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier.  The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191).  James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.  Judge Wedoff confirmed
the Debtors' Amended Plan of Reorganization on Jan. 20, 2006.


W.R. GRACE: Battles Anderson Memorial on Class Certification Move
-----------------------------------------------------------------
Anderson Memorial Hospital asks the U.S. Bankruptcy Court for the
District of Delaware to certify an opt-out class action on behalf
of itself and other similarly situated property owners whose
buildings were, are, or will be contaminated with asbestos fibers
released from asbestos-containing surfacing materials for which
W.R. Grace & Co. and its debtor-affiliates are legally
responsible.

Anderson has filed asbestos property damage claims against the
Debtors' estate.

Daniel A. Speights, Esq., at Speights & Runyan, in Hampton, South
Carolina, relates that the Debtors' sales and shipping records
identified thousands of buildings with W.R. Grace & Co.'s
surfacing products.  Thus, when the Debtors advanced their note
campaign pursuant to the Court's Bar Date Order, they had, at
their disposal, physical and mailing addresses of those buildings
with asbestos property damage claims.

However, Mr. Speights notes, the Debtors made no attempt to mail
individual notices of the Bar Date to those potential claimants
and have relied instead on notice by publication.

Mr. Speights asserts that since the notice to known creditors was
inadequate, a class certification may be the only means by which
many property damage creditors can receive proper notice by which
their claims can be discharged.

                Class Certification Requirements

Under Rule 23(a) of the Federal Rules of Civil Procedure, one
or more members of a class may sue or be sued as representative
parties on behalf of all only if:

   (a) the class is so numerous that joinder of all members is
       impracticable;

   (b) there are questions of law or fact common to the class;

   (c) the claims or defenses of the representative parties are
       typical of those of the class; and

   (d) the representative parties will fairly and adequately
       protect the interests of the class.

Mr. Speights points out that there are thousands of asbestos
property damage claims currently pending in the Debtors'
bankruptcy case that fit within the Anderson class definition.  
Moreover, "numerosity does not require that joinder of all
parties be impossible, only impracticable and inefficient,"
Mr. Speights reminds the Court, citing Ardy v. Federal Kemper
Insurance Co., 142 F.R.D. 105, 111 (E.D.Pa.1992).

It is not necessary for every class member to have identical
claims, Mr. Speights asserts.  Rather, the "commonality
requirement will be satisfied if the named plaintiffs share at
least one question of fact or law with the grievances of the
prospective class." Krell v. Prudential Insurance Co. of America,
145 F.3d 283, 310 (3d Cir.1998).

Mr. Speights maintains that Anderson's claim is typical of the
absent class members' claims because the claims are united by:

   -- federal and state regulations, which require the eventual
      removal of friable asbestos materials regardless of the
      exact product involved; and

   -- Grace's civil conspiracy liability, which renders all the
      defendants responsible for the damage caused by their co-
      conspirators' products as well as their own.

Mr. Speights further argues that adequacy focuses on whether or
not any conflict exists between the named representative and the
absent class members related to the action's subject.  The issue
is whether or not Anderson's counsel is generally able to conduct
the suit and whether the class representative's interests are
antagonistic to those of the rest of the class.

Civil Rule 23(b)(3) permits class certification in those
instances where "the Court finds that the questions of law or
fact common to the class predominate over any questions affecting
only individual members and a class action is superior to other
available methods for the fair and efficient adjudication of the
controversy."

Mr. Speights points out that the class' cohesiveness is
emphatically demonstrated by the Debtors' insistence that the
Court entertain the legal issues in the estimation proceeding
that they claim apply to the broad spectrum of PD claimants.  
These issues include:

   (i) whether Monokote is hazardous;

  (ii) constructive notice for the statute of limitations; and

(iii) the reliability of testing methodologies used to measure
       asbestos contamination.

Mr. Speights contends that common issues like whether Grace's
asbestos containing-surfacing materials are hazardous, whether
these products release asbestos fibers under foreseeable uses,
whether Grace tested its products for fiber release potential and
whether the defendants owed or breached any duties to building
owners clearly predominate over individual issues like actual
notice or individual damages.

                        Debtors Object

"Mr. Speights' motion for class certification [on Anderson's
behalf] is just more of the same from a would-be member of an
official committee who appears constitutionally incapable of
appreciating the interests of the bankruptcy process or even
following the basic rules of litigation," James E. O'Neill, Esq.,
at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., in
Wilmington, Delaware, tells the Court.

Mr. O'Neill contends that the proposed certification would
frustrate rather than advance the Debtors' recent movement toward
resolution, and would pervert rather than implement the core
requirements of Rule 7023 of the Federal Rules of Bankruptcy
Procedure.

According to Mr. O'Neill, the proposed certification would spell
immediate delay as class notice is given, opt out rights are
exercised, and class claims are litigated -- all without knowing
whether there really are any actual bona fide claimants beyond
those who timely met the Bar Date.  It would manufacture
immediate uncertainty over the number of potential claims, just
as progress is being made in filtering out the myriad invalid
claims that Mr. Speights already has lodged.

"It would further complicate the already difficult task of plan
negotiations, as Mr. Speights would re-emerge, phoenix-like as a
major obstacle to reaching consensus," Mr. O'Neill argues.

As in Anderson's case, Mr. O'Neill maintains that asbestos
property damage litigation in general is beyond mature, and, it
is virtually ossified.  Individual claimants not only have ready
access to counsel and the courts, they already have come forward
to press their claims.

As the U.S. Court of Appeals for the Seventh Circuit underscored
in "In the Matter of Rhone-Poalenc Rarer Inc.," class
certification should be avoided where litigation is mature and
claimants have both the means and the opportunity to litigate
claims individually.

Accordingly, the Debtors ask Judge Fitzgerald to deny Anderson's
request.

                  Debtors Want Discovery Barred

On Anderson's behalf, Speights & Runyan served five separate
discovery requests on the Debtors.

Mr. O'Neill argues that none of the topics covered by the
Discovery Requests implicate the types of issues that the Court
will need to decide on Anderson's request.  Instead, Anderson
seeks stale and irrelevant information, including:

   (1) the Debtors' knowledge of how many of the hundreds of
       thousands of people that received notice of the Bar Date
       held potential property damage claims against the Debtors;

   (2) the Debtors' knowledge of and efforts to determine the
       addresses and owners of buildings that allegedly contain
       Grace asbestos-containing materials;

   (3) the Debtors' knowledge of and prepetition efforts to
       settle the Anderson class action filed in South Carolina;

   (4) the Debtors' knowledge of efforts in 2001 to exclude
       Anderson, Speights & Runyan, or Mr. Speights from the
       Official Committee of Property Damage Creditors;
       and

   (5) the Debtors' communications with the Celotex Asbestos
       Settlement Trust or the Bodily Injury Trust Advisory
       Committee regarding PD claims filed by Speights & Runyan
       or through Anderson.

Mr. O'Neill argues that the Discovery Requests are designed to
delay the Class Certification Hearing rather than lead to the
discovery of admissible evidence.

The parties have met and conferred about the discovery at issue
but were unable to reach agreement, Mr. O'Neill tells the Court.

Pursuant to Rule 26(c) of Federal Rules of Civil Procedure, the
Debtors ask Judge Fitzgerald for a protective order against
Speights & Runyan's requests for depositions and related
documents.

Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq., at
Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 101; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


W.R. GRACE: Asbestos PD Panel Gets Court Okay to Hire Dies & Hile
-----------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware authorizes the Official Committee of
Asbestos Property Damage Claimants appointed in the chapter 11
cases of W.R. Grace & Co. and its debtor-affiliates to retain Dies
& Hile L.L.P.

The PD Committee wants Martin W. Dies, III, Esq., at Dies & Hile
L.L.P., to represent it in the context of the asbestos PD claims
estimation, particularly in litigating the "science" or
harmfulness of the Debtors' various asbestos-containing products.

As reported in the Troubled Company Reporter on Sept. 15, 2005,
the Court ordered that the proceedings to estimate the Debtors'
asbestos property damage liabilities would proceed in two phases.  
In Phase I, the Court will first consider the "Methodology Issue"
addressing certain methodologies for determining exposure to
asbestos that must comply with Rule 702 of the Federal Rules of
Evidence, particularly, the use of dust versus air sampling.

Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq., at
Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 100; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


W.R. GRACE: Dec. 31 Balance Sheet Upside-Down by $595.6 Million
---------------------------------------------------------------
W.R. Grace & Co. (NYSE:GRA) reported financial results for the
fourth quarter and full year ended Dec. 31, 2005.

Sales for the fourth quarter of 2005 were $636.4 million compared
with $589.1 million in the prior year quarter, an 8% increase.  
The increase was attributable primarily to higher sales volume in
all geographic regions, improved product mix and selling price
increases in response to cost inflation.  Sales increased 5.8% for
the Davison Chemicals segment and 10.7% for the Performance
Chemicals segment.

Net loss in the fourth quarter of 2005 was $600,000, compared with
a net loss of $487.4 million in the prior year quarter.  

Sales for the year ended Dec. 31, 2005 were $2,569.5 million
compared with $2,259.9 million for the prior year, a 13.7%
increase.  Net income for 2005 was $67.3 million, compared with a
net loss in 2004 of $402.3 million.  

"We continued to deliver solid sales growth in the fourth quarter,
capping a successful operating year for our company," Grace's
President and Chief Executive Officer Fred Festa, said.  "Working
with our many valued customers, we have successfully improved
business fundamentals through a combination of innovation and
productivity.  Our businesses ended 2005 with nearly 14% sales
growth and 12% operating profit growth in a year where we faced
considerable cost pressures and extraordinary events."

                     Cash Flow And Liquidity

Grace's net cash flow from operating activities for 2005 was
$54.4 million, compared with $313 million for 2004.  The 2005 cash
flow includes an increase in working capital in response to higher
sales and bankruptcy court-approved payments aggregating
$119.7 million to resolve U.S. federal tax return audits and an
environmental contingency at a formerly owned site.

At Dec. 31, 2005, Grace had available liquidity in the form
of cash $474.7 million, net cash value of life insurance
$84.8 million and available credit under its debtor-in-possession
facility $211.3 million.  Grace believes that these sources and
amounts of liquidity are sufficient to support its business
operations, strategic initiatives and Chapter 11 proceedings for
the foreseeable future.  Grace's debtor-in-possession credit
facility expires on March 31, 2006 and is expected to be renewed
at the current level of $250 million.

Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq., at
Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.

As of Dec. 31, 2005, W. R. Grace & Co.'s balance sheet showed a
stockholders' deficit of $595.6 million, compared to $621.8
million deficit at Dec. 31, 2004.


WHITEHALL JEWELLERS: Special Meeting Postponed Until Feb. 6, 2006
-----------------------------------------------------------------
Whitehall Jewellers, Inc. (OTC:JWLR.PK) received a binding
proposal from Newcastle Partners, L.P. regarding the terms of
Newcastle's proposed acquisition of the Company's capital stock
for $1.50 per share in cash, including:

   1) the terms of a tender offer and merger agreement, and

   2) related binding agreements pursuant to which Newcastle:

     a) would fund and be obligated to hold separate the
        approximately $150 million required in the event it is
        selected:

        * to purchase all of the Company's shares and
        * to pay off the Company's senior credit facility,

     b) refinance the bridge loan from Prentice Capital
        Management, L.P. and Holtzman Opportunity Fund, L.P., and

     c) pay related fees and penalties.

The Board of Directors of the Company has determined after
consultation with the Company's financial and legal advisors in
accordance with the securities purchase agreement that the
Newcastle transaction constitutes a "Superior Proposal" under the
Prentice securities purchase agreement, which is defined under
such agreement as a transaction that is both more favorable than
the Prentice transaction from a financial point of view to the
Company, its stockholders and creditors, taken as a whole, and is
also reasonably capable of being consummated.  Based upon this
determination, the Board of Directors hereby withdraws its
previous support and recommendation of the Prentice transaction.

In addition, the special meeting of the Company's stockholders
that was to be held on Jan. 25, 2006, in connection with the
Prentice transaction is hereby postponed until Feb. 6, 2006 at
10:00 am CST, at a location in Chicago to be determined.

Under the Prentice agreement, Prentice will have the opportunity
for ten business days to counter-offer with a revised proposal.  
There can be no assurance as to when, or whether, Prentice would
present any such counter-offer to the Board.  If Prentice makes
such a counter-offer, under the terms of the current Prentice
agreement the Board will then consider both proposals and at that
time again determine whether the Newcastle proposal is superior.  
Among other instances, each of the Company and Prentice has the
right to terminate the current Prentice agreement if the closing
has not occurred by Jan. 31, 2006.

Headquartered in Chicago, Illinois, Whitehall Jewellers, Inc. --
http://www.whitehalljewellers.com/-- is a national specialty  
retailer of fine jewelry, operating 387 stores in 38 states.  The
Company has announced that it intends to close a number of stores
in the near term.  The Company operates stores in regional and
super regional shopping malls under the names Whitehall Co.
Jewellers, Lundstrom Jewelers and Marks Bros. Jewelers

                          *     *     *

As previously reported in the Troubled Company Reporter, the Board
of Directors of Whitehall Jewellers, Inc. (OTC:JWLR.PK) reported
that Newcastle Capital Management, L.P. finally has made an offer
that does not have a financing contingency.  Newcastle has
initiated an unsolicited tender offer for Whitehall stock.

To consider whether the Newcastle proposal is a superior offer,
the Board requires that Newcastle provide conclusive evidence that
it has the cash to complete a transaction as well as evidence of
its ability and commitment to promptly complete a transaction.

The Board hopes that Newcastle will quickly provide the requested
evidence as the Board and the Company can no longer afford delays.
Specifically, the company's bank line expires on Jan. 31, 2006, as
does the company's bridge loan and its vendors can terminate their
agreement to accept payment of their past due invoices over time.

                   Bankruptcy Warning

Without a firm deal, such as one the company currently has in
place with Prentice Capital Management, L.P., the company will
likely be forced to pursue a restructuring or bankruptcy, which
may severely impact the Company's stockholders as well as the
Company's other constituencies.  The Board is dedicated to seeing
that this does not occur.  The Board is hopeful that Newcastle
will understand and provide the Board with the needed information
in the extremely short period available.  The company once again
reiterates its recommendation that stockholders vote for the
management/Prentice proposals and nominees at the Jan. 19, 2005,
shareholders meeting.


WODO LLC: Judge Overstreet Confirms Third Amended Chapter 11 Plan
-----------------------------------------------------------------
The Honorable Karen A. Overstreet of the U.S. Bankruptcy Court for
the Western District of Washington confirmed the Third Amended
Plan Of Reorganization filed by Wodo, LLC.  Judge Overstreet
confirmed the Debtor's Plan on Jan. 24, 2005.

Judge Overstreet concludes that the Third Amended Plan complies
with the applicable provisions of the Bankruptcy Code and
confirmation of the Plan is not likely to be followed by
liquidation or further financial reorganization of the Debtor or
any successor to the Debtor under the Plan.

                      Terms of the Plan

As reported in the Troubled Company Reporter on Dec. 19, 2005,
under the Plan, holders of Administrative Convenience Claims will
receive cash payments equal to the full amount of their Allowed
Claims, not to exceed $10,000.  Holders of Allowed Administrative
Convenience Claims will be paid 50% of their claims from non-
Debtor sources ten days after the Effective Date and the remaining
50% of their Allowed Claims will be paid thirty days after the
Effective Date.

Holders of Secured Property Tax Claims will retain all the liens
securing their claims.  Interest shall accrue on the claims from
the Petition Date at the non-default rates in accordance with
applicable non-bankruptcy law.  Upon transfer of any of the Real
Property, the Claims secured by such property will be paid in
full.

Skagit State Bank's Liens claims and liens against the Debtor's
assets will be satisfied in full from non-Debtor assets through a
refinancing of Skagit State's loans to the Debtor's affiliates.

The Secured Claims of Guaranty Bank will retain its liens and all
of its rights and remedies in the two Letters of Credit it has
with the Debtor.

Holders of Allowed General Unsecured Claims will be paid from non-
Debtor sources 50% of their Allowed Claims 30 days following the
Effective Date and 50% of their Claims sixty 60 days following the
Effective Date.

Unit Holders will retain their interests in the Debtor.

                   WULA Secured Claims

The Allowed Western United Life Assurance (WULA) Secured Claim
will accrue interest from the Effective Date at a 13% non-default
rate provided in the Loan Documents until satisfied.

A compromise of controversies regarding portions of WULA's secured
claims includes:

   a) WULA's claim to attorneys' fees and its claim to default
      interest under the loan documents,

   b) WULA's claim to a $1,000,000 "bonus," and

   c) claims the Debtor and its affiliates may have against WULA
      resulting from their failure to carry out prior commitments
      relating to this and other transactions.

A full-text copy of the Third Amended Plan is available for a fee
at:

  http://www.researcharchives.com/bin/download?id=060125031534

Headquartered in Bellingham, Washington, Wodo, LLC, fka Trillium
Commons, LLC, is a real estate company.  The Company filed for
chapter 11 protection on January 18, 2005 (Bankr. W.D. Wash. Case
No. 05-10556).  Gayle E. Bush, Esq., at Bush Strout & Kornfeld
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it listed total
assets of $90,380,942 and total debts of $21,451,210.


WORLDCOM INC: Inks Stipulation Settling U.S. Defense Dept. Claims
-----------------------------------------------------------------
On January 23, 2003, the United States Department of Defense filed
Claim No. 15283, asserting $23,320,000 in alleged credits due
under certain government contracts for telecommunications services
provided by WorldCom, Inc., and its debtor-affiliates to the
Defense Department, and alleged overbilling in connection with
those services.

The Debtors objected to the Claim.

The Defense Department later amended Claim No. 15283, with Claim
No. 38575 for $775,000.  Pursuant to the amendment, the Defense
Department agreed to the expungement of Claim No. 15283.

Accordingly, in a Court-approved stipulation, the Parties agree
that:

   (a) the Debtors will not file an objection to Claim No. 38575
       until one or both parties terminates settlement
       discussions prior to the consensual resolution of Claim
       No. 38575; and

   (b) any future objection filed by Debtors to Claim No. 38575
       will not extend beyond the scope of those grounds
       previously raised by the Debtors in their objection to
       Claim No. 15283 in the 42nd Omnibus Claims Objection.

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. 112; 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 A. Soriano-Baaclo, Marjorie C. Sabijon, Terence
Patrick F. Casquejo, Christian Q. Salta, Jason A. Nieva, Lucilo
Junior M. Pinili, Tara Marie A. Martin and Peter A. Chapman,
Editors.

Copyright 2006.  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 $725 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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