TCR_Public/060214.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Tuesday, February 14, 2006, Vol. 10, No. 38

                             Headlines

ACANDS INC: Insurer Balks at Dr. Peterson & LAS' Delayed Retention
ADELPHIA COMMS: Non-Agent Secured Lenders Can Campaign vs. Plan
ADELPHIA COMMS: John Griffin Construction Objects to Ch. 11 Plan
AGILYSYS INC: Earns $15.2 Million of Net Income in Third Quarter
ALASKA COMMS: Inks $115 Million Interest Rate Swap Agreement

ALION SCIENCE: Moody's Cuts Family Rating to B2 on Low Revenue
ALION SCIENCE: S&P Rates Proposed $50 Million Add-On Loan at B+
ALLIED HOLDINGS: Wants Cushman & Wakefield as Real Estate Broker
ALLIED WASTE: Moody's Holds Junk Rating on Convertible Securities
ALLSERVE SYSTEMS: Ch. 7 Trustee Taps McElroy Deutsch as Counsel

AMARIN CORP: Posts $5.2 Million Net Loss in Fourth Quarter of 2005
AMCAST INDUSTRIAL: Court Okays Dann Pecar as Bankruptcy Counsel
AMCAST INDUSTRIAL: Hires Bracewell & Guiliani as Bankr. Co-Counsel
AMERICAN COMMERCIAL: S&P Raises Corporate Credit Rating to BB-
AMERIGAS PARTNERS: Higher Propane Prices Lift Revenues

AOL LATIN: Wants Court OK to Extend Cicerone Capital's Employment
ARMSTRONG WORLD: Told to File 4th Amended Ch. 11 Plan by Feb. 21
ATRIUM COS: S&P Upgrades Corporate Credit Rating to B from CCC+
AUBURN ASSOCIATES: Case Summary & 18 Largest Unsecured Creditors
AVAYA INC: Plans to Redeem 11-1/8% Senior Sec. Notes on April 3

AXS-ONE: December 31 Balance Sheet Upside Down by $2.11 Million
BALL CORP: Fitch Affirms Senior Unsecured Notes' Ratings at BB
BRANDYWINE REALTY: Sells Burnett Plaza for $172 Million
BROWNING-FERRIS: Moody's Affirms Junk Rating on $284 Mil. Bonds
CALPINE CORP: Wants Court to Approve Hiring of PwC as Auditors

CAPITAL AUTO: S&P Places BB Preliminary Rating on Class D Notes
CEEBRAID ACQUISITION: Case Summary & 13 Largest Unsec. Creditors
CENTENNIAL COMMS: Offers to Swap Sr. Notes for Registered Bonds
CENTRAL PARKING: Earns $17.9 Mil. in First Quarter Ended Dec. 31
CHAMPION ENTERPRISES: Releases Financials for Fourth Quarter 2005

COLLINS & AIKMAN: Wants to Modify JPMorgan DIP Loan Agreement
COMPANHIA ENERGETICA: Moody's Rates $800 Million Term Notes at B3
CONEXANT SYSTEMS: Jury Returns $112 Mil. Verdict in Patent Dispute
CUMMINS INC: Gets SEC Order on Financial Reporting Violations
DIRECTED ELECTRONICS: S&P Upgrades Corporate Credit Rating to BB-

DWJ ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
EMMIS COMMS: Will Redeem Remaining $120M of Sr. Notes on Mar. 9
EQUINOX HOLDINGS: Moody's Rates $290 Mil. Sr. Debt Offering at B3
EQUINOX HOLDINGS: S&P Rates Proposed $290 Million Sr. Notes at B-
ERHC ENERGY: Posts $1.2 Mil. Net Loss in Quarter Ended December 31

EXIDE TECH: Posts $27.6MM Net Loss in Quarter Ended December 31
EXTENSITY SARL: S&P Rates Proposed $410 Million Facilities at B
FEDDERS CORP: Receives Non-Compliance Notice from NYSE
FFCA SECURED: Fitch Downgrades Seven Loan Classes' Ratings to Cs
FIRST FRANKLIN: Fitch Affirms Class B Certificates' BB+ Rating

GENCORP INC: Posts $175 Mil. Net Loss in Fourth Qtr. Ended Nov. 30
GENCORP INC: S&P Lowers Corporate Credit Rating to B+ from BB-
GRANDVIEW HEIGHTS: Case Summary & 20 Largest Unsecured Creditors
GREAT NORTHERN: Ch. 7 Trustee Taps Silverman as Mass. Counsel
GREENWICH CAPITAL: Moody's Downgrades $1 Mil. Certs. Rating to B1

GSMPS MORTGAGE: Moody's Puts Low-B Ratings on Three Subord. Certs.
HEATING OIL: Committee Brings In Pepe & Hazard as Local Counsel
INT'L RECTIFIER: Fitch Affirms B+ Sr. Subordinated Debt's Rating
INZON CORP: Increased Costs Lead to Higher Losses in 1st Quarter
J.L. FRENCH: Bankruptcy Court Approves First Day Motions

KAISER ALUMINUM: KACC Balks at Gramercy's $5-Mil. Admin. Claim
LEHMAN XS: Moody's Assigns Ba2 Rating on Class B Notes
LEVEL 3 COMM: Posts $169 Million Net Loss in 4th Quarter of 2005
LODGENET ENTERTAINMENT: Posts $2.3 Mil. Net Loss in Fourth Quarter
MAJESTIC STAR: Moody's Lifts Rating on $80 Mil. Sr. Loan to Ba3

NAVISTAR INT'L: Receives $1.5 Billion Loan Commitment from Lenders
NAVISTAR INT'L: Fitch Downgrades Subordinated Debt's Rating to B
NAVISTAR INT'L: S&P Maintains Watch on BB- Corporate Credit Rating
NOVA COMMUNICATIONS: Changes Name to Encompass Holdings, Inc.
NOVEMBER 2005: S&P Rates $80 Million Sr. Credit Facility at B+

O'SULLIVAN INDUSTRIES: Court Approves Disclosure Statement
OAK CREEK: Wants Court to OK GMACC Agreement & Dismiss Bankr. Case
ON SEMICONDUCTOR: Cuts Interest Rate on $639.1M of Term Loans
OWENS CORNING: Court Sets April 5 Disclosure Statement Hearing
PANOLAM INDUSTRIES: Nevamar Acquisition Cues S&P to Affirm Ratings

PARMALAT USA: Preliminary Injunction Stretched to March 31
PATHMARK STORES: Awards Kenneth Martindale Restricted Common Stock
PENNSYLVANIA REAL: Acquires Springhills Property for $21.5 Million
PHASE III: Completes $1 Million Funding to Aid Purchase of NeoStem
PEP BOYS: S&P Places B- Corporate Credit Rating on Watch

PERFORMANCE TRANSPORTATION: U.S. Trustee Forms Creditors Committee
PHLO CORP: Posts $904,494 Net Loss in Quarter Ended December 31
ROGERS COMMS: Posts $66.7 Million Net Loss in Fourth Quarter 2005
ROUGE INDUSTRIES: Has Interim Access to Lenders' Cash Collateral
SAINT VINCENTS: Clarifies Coverage of Malpractice Claims Protocol

SALOMON BROTHERS: Projected Losses Cue Moody's to Review Rating
SAVVIS INC: Dec. 31 Balance Sheet Upside-Down by $132 Million
SCHOONER TRUST: Moody's Rates CDN$2.4 Million Certs. at (P)B3
SECURUS TECHS: S&P Affirms B+ Corp. Credit & Sr. Sec. Debt Ratings
SERENA SOFTWARE: Merger Cues Moody's to Junk $225MM Sr. Sub. Notes

SERENA SOFTWARE: S&P Rates $225 Million Sr. Sub. Notes at CCC+
SILICON GRAPHICS: Studying Alternatives to Avoid Bankruptcy
SUPERIOR LODGING: Case Summary & Known Creditors
T.A.T. PROPERTY: Meeting of Creditors Scheduled for February 28
T.A.T. PROPERTY: Wants Until March 30 to File Chapter 11 Plan

TECUMSEH PRODUCTS: Posts $55.8 Mil. Net Loss in Fourth Qtr. 2005
TOMMY HILFIGER: Earns $15.5 Million in Third Quarter Ended Dec. 31
TRIPATH TECH: Reports $3.4 Million First Quarter Net Revenue
UNIVERSITY HEIGHTS: Case Summary & 12 Largest Unsecured Creditors
USG: Dist. Ct. Revises Asbestos Estimation Discovery Schedule

VALERO ENERGY: Fitch Raises Securities' Rating to BBB- from BB+
VERITAS DGC: Inks New $85 Million Credit Facility
VIACAO ITAPEMIRIM: Fitch Affirms & Withdraws CCC Sr. Notes' Rating
VIRAGEN INC: Posts $4.6 Million Net Loss in Quarter Ended Dec. 31
WINDSWEPT ENVIRONMENTAL: Earns $3MM of Net Income in 2nd Quarter

XYBERNAUT CORP: Court Okays Chantilly Office Lease Agreement

* Large Companies with Insolvent Balance Sheets

                             *********

ACANDS INC: Insurer Balks at Dr. Peterson & LAS' Delayed Retention
------------------------------------------------------------------
Travelers Casualty and Surety Company, a creditor and insurer of
ACandS, Inc., objects to the proposed retention of Legal Analysis
Systems, Inc., as a consultant to the Debtor's Official Committee
of Asbestos Personal Injury Claimants.  LAS is Dr. Mark A.
Peterson's California-based consulting firm; Dr. Peterson provides
expert testimony in virtually every asbestos-related restructuring
that the present value of pending and future asbestos claims
renders the debtor hopelessly insolvent.  

Travelers says that the Asbestos Committee failed to provide
competent evidence that LAS' services are necessary for the
administration of the Debtor's bankruptcy case.  The insurer
questions the Committee's decision to retain LAS more than three
years into the Debtor's bankruptcy case and after supporting a
plan of reorganization that is currently on appeal.

Accordingly, Travelers wants the U.S. Bankruptcy Court for the
District of Delaware to compel LAS and the Committee to promptly
respond to its outstanding discovery requests and justify LAS'
retention.

As reported in the Troubled Company reporter on Feb. 13, 2006, the
Asbestos Committee sought permission to hire LAS as its asbestos-
related bodily injury consultant, nunc pro tunc to Sept. 29, 2005.
LAS will primarily assist the Asbestos Committee in estimating the
number and value of present and future asbestos personal injury
claims and developing procedures to be used in the development of
financial models for the payment of claims.

To support its objection to the LAS retention, Travelers commenced
narrowly tailored discovery focusing on the necessity for and
circumstances surrounding LAS' nunc pro tunc retention.  The
Asbestos Committee refused to comply with the discovery saying:

      -- the question of whether it requires an asbestos bodily
         injury expert is irrelevant to the LAS retention
         application;

      -- professionals are not subject to discovery in connection
         with their retention applications;

      -- its reasons for hiring LAS are protected by the attorney-
         client privilege; and

      -- LAS did not have reasonable time to provide the requested
         discovery.

Headquartered in Lancaster, Pennsylvania, ACandS, Inc., was an
insulation contracting company, primarily engaged in the
installation of thermal and mechanical insulation.  In later
years, the Debtor also performed a significant amount of asbestos
abatement and other environmental remediation work.  The Company
filed for chapter 11 protection on September 16, 2002,
(Bankr. Del. Case No. 02-12687).  Laura Davis Jones, Esq., at
Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents
the Debtor in its restructuring efforts.  Kathleen Campbell Davis,
Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine, LLC,
represent the Official Committee of Asbestos Personal Injury
Claimants.  When the Company filed for protection from its
creditors, it estimated debts and assets of over $100 million.  

                    Chapter 11 Plan Update

As previously reported, Judge Fitzgerald approved the adequacy
of the Debtor's Amended Disclosure Statement explaining their
proposed Plan of Reorganization on Oct. 3, 2003.  On Jan. 26,
2004, Judge Fitzgerald entered Proposed Findings of Fact
and Conclusions of Law Re Chapter 11 Plan Confirmation (Docket No.
979), recommending that the U.S. District Court deny confirmation
of the Debtor's Plan.  On Feb. 5, 2004, the Debtor and the
Official Committee of Asbestos Personal Injury Claimants jointly
filed with the District Court an objection to the Bankruptcy
Court's Proposed Findings.  In that filing, the Debtor and the
Committee asked the District Court to reject the Bankruptcy
Court's Findings and Conclusions and confirm the proposed chapter
11 plan.  

On Nov. 18, 2005, Judge Fitzgerald entered an order (Doc. 2081)
extending, through and including the earlier of the effective date
of its chapter 11 plan and Feb. 14, 2006, its exclusive period
under 11 U.S.C. Sec. 1121 to file a further amended chapter 11
plan, and extending the Debtor's exclusive period to solicit
acceptances of that plan from creditors, through the earlier of
the effective date of that plan and May 22, 2006.


ADELPHIA COMMS: Non-Agent Secured Lenders Can Campaign vs. Plan
---------------------------------------------------------------
The Honorable Robert D. Gerber of the U.S. Bankruptcy Court for
the Southern District of New York approves the Ad Hoc Committee of
Non-Agent Secured Lenders' revised form of Solicitation Letter and
Adelphia Communications Corporation and its debtor-affiliates'
letter to the secured lenders in response to the Non-Agent
Committee's Solicitation Letter.

As reported in the Troubled Company Reporter on Feb. 1, 2006, the
Ad Hoc Committee of Non-Agent Secured Lenders wanted the Court to
approve its solicitation letter and authorize its distribution.   
The Ad Hoc Committee of Non-Agent Secured Lenders is campaigning
against the Debtors' Fourth Amended Joint Plan of Reorganization.

The Debtors and the Ad Hoc Committee exchange barbs over the
content of the solicitation letter, prompting the Ad Hoc Committee
to revised it.

A full-text copy of the revised Solicitation Letter is available
for free at http://ResearchArchives.com/t/s?545

A full-text copy of the Debtors' Responsive Letter is available
for free at http://ResearchArchives.com/t/s?510

Judge Gerber authorized the Non-Agent Secured Lenders' Committee
to distribute to potentially interested parties, the revised
Solicitation Letter and the Debtors' Letter, to be distributed
together.

The Non-Agent Committee's request to publish any shortened form
of the Non-Agent Letter is denied.

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


ADELPHIA COMMS: John Griffin Construction Objects to Ch. 11 Plan
----------------------------------------------------------------
John Griffin Construction, Inc., and Adelphia Cable Communications
"and possibly other Adelphia entities" were parties to various
written agreements to which John Griffin provided construction
labor and materials to ACOM's voice, video and data
telecommunications and cable television systems in Orange County
and Los Angeles County, California.  According to Mary E. Olden,
Esq., at McDonough Holland & Allen PC, in Sacramento, California,
at the time of the ACOM Debtors' Petition Date, ACOM was indebted
to John Griffin for $2,972,865, secured by Griffin's mechanic's
liens.

John Griffin objects to the ACOM Debtors' plan of reorganization
because it fails three tests necessary for confirmation, by:

    1. improperly designating Class 3 claims as unimpaired and not
       entitled to vote;

    2. improperly classifying together claims which are not
       substantially similar; and

    3. failing the requirement of Section 1129(a)(a) -- the "best
       interest of creditors" test.

Ms. Olden notes that the Plan defines Class 3 claims, to which
John Griffin's claim belongs, as unimpaired.  However, it impairs
some of the Class 3 Claims by failing to provide for:

    -- interest at the proper rate, and
    -- payment of interest until the claim is paid.

In addition, the Plan impairs only a specific group of Class 3
claims, Class 3 includes claims that are not substantially
similar to one another.  Section 1122 of the Bankruptcy Code
states that dissimilar claims may not be classified together.

John Griffin notes that the Plan had failed the "best interest of
the creditors" test by treating some oversecured claims much more
favorably than others.  The Plan provision terminating interest
accrual at the effective date also violates the best interest
test.

These defects render the Plan uncomfirmable, Ms. Olden says.  She
asserts that the ACOM Debtors must either amend the Plan to
unimpair all Class 3 claims, or must amend the Plan to correct
the improper classification and reopen balloting on plan
acceptance to allow the holders of impaired claims currently in
Class 3 to vote.

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


AGILYSYS INC: Earns $15.2 Million of Net Income in Third Quarter
----------------------------------------------------------------
Agilysys, Inc. (Nasdaq: AGYS) reported unaudited fiscal 2006
third-quarter and nine-months results for the period ended
Dec. 31, 2005.  For the quarter, the company's sales increased 3%
to $532.2 million compared with $515.7 million for the third
quarter last year.

Third-quarter sales of hardware products were $423.1 million, up
3% from $412.0 million last year.  Software sales were $81.8
million, up 3% from $79.1 million a year ago, and services sales
were $27.2 million, up 11% from $24.5 million last year.

Gross margin for the quarter was 13.2% of sales, compared with
12.8% in the prior year.  Selling, general and administrative
expenses were $43.5 million, or 8.2% of sales for the quarter,
compared with $39.7 million, or 7.7%, in the prior year.  The
year-over-year increase in selling, general and administrative
expenses was mainly driven by higher compensation and benefits
costs, as well as higher bad debt expense.

Net income was $15.2 million for the quarter ended Dec. 31, 2005,
compared with net income of $14.2 million, for the quarter ended
Dec. 31, 2004.

For the nine months ended Dec. 31, 2005, sales were $1.35 billion,
a 6% increase over sales of $1.27 billion reported for the
comparable period last year.  Gross margin for the nine months was
12.9% of sales, consistent with 12.9% in the prior year.  Selling,
general and administrative expenses were $123.4 million, or 9.2%
of sales for the nine months, compared with $117.9 million, or
9.3%, in the prior year.

The company recorded net income for the nine months of 2005 of
$22.1 million compared with net income of $21.8 million last year.

Excluding $5.1 million in restructuring charges reported for the
nine months and a non-recurring $4.8 million loss on redemption of
the company's Convertible Trust Preferred Securities in the first
quarter, the company would have reported a 27% increase in non-
GAAP net income to $28.0 million compared with non-GAAP net income
of $22.1 million in the prior year.

Arthur Rhein, chairman, president and chief executive officer of
Agilysys, said, "I am pleased with our third-quarter results,
which exhibited a number of positive trends including an
improvement in gross margin and an increase in net income. In
addition, our year-to-date results were strong with a 6% increase
in sales and a 27% increase in non-GAAP net income."

                   Restructuring Charges

During the first half of fiscal 2006, Agilysys consolidated a
portion of its operations to reduce costs and increase operating
efficiencies.  As a result of this initiative, Agilysys recorded a
total of $5.1 million in restructuring charges during the first
nine months of fiscal 2006.  As previously announced, the company
expects to realize cost savings of approximately $6.0 million in
the current fiscal year and approximately $7.0 million per year
thereafter.

     Redemption of Convertible Trust Preferred Securities

In the first quarter of fiscal 2006, as part of its strategy to
increase both financial flexibility and shareholder value, the
company redeemed its 6.75% Convertible Trust Preferred Securities.  
Agilysys shareholders benefited from the elimination of the annual
distribution on the Trust Preferred Securities, which amounted to
approximately $5.2 million annually, net of tax, and the removal
of 6.7 million shares of dilution.

                        Business Outlook

Agilysys expects fiscal 2006 sales growth between 5% and 7% over
fiscal 2005 sales of $1.62 billion; gross margin of approximately
12.9% of sales; selling, general and administrative expenses of
approximately 9.6% of sales; and net income per diluted share of
80 to 88 cents, which includes the impact of the restructuring
charges and the loss on the redemption of the convertible trust
preferred securities.  Excluding these one-time items, the company
expects diluted earnings per share of 98 cents to $1.06 for the
fiscal year.  Based on year-to-date performance, Agilysys expects
to achieve results near the high end of the ranges provided.

Agilysys also expects to incur fiscal 2006 capital expenditures of
$3 to $4 million, depreciation and amortization of approximately
$11 million, and interest expense to be partially offset by
interest and other income.

Agilysys, Inc. -- http://www.agilysys.com/-- is one of the  
foremost distributors and premier resellers of enterprise computer
technology solutions.  It has a proven track record of delivering
complex server and storage hardware, software and services to
resellers, large and medium-sized corporate customers, as well as
public-sector clients across a diverse set of industries. In
addition, the company provides customer-centric software
applications and services focused on the retail and hospitality
markets.  Headquartered in Mayfield Heights, Ohio, Agilysys has
sales offices throughout the United States and Canada.

                        *     *     *

Agilysys, Inc.'s 9-1/2% Senior Notes due 2006 carry Standard &
Poor's BB- rating.  S&P assigned that rating on Oct. 14, 2004.  
Moody's has rated Agilysys' 9-1/2% Senior Notes at Ba3 since
April 18, 2004.


ALASKA COMMS: Inks $115 Million Interest Rate Swap Agreement
------------------------------------------------------------
Alaska Communications Systems Group, Inc. (NASDAQ:ALSK) reported
the execution of a $115 million notional amount floating-to-fixed
interest rate swap agreement related to its $375 million term loan
under a senior secured bank credit facility the company entered
into on Feb. 1, 2005.

The swap effectively fixes the rate on $115 million principal
amount of senior secured bank debt at 4.96% through December 2011.  
The company had previously entered into interest rate swaps for a
notional amount of $260 million, and this transaction fixes the
rates on its entire $375 million term loan.

"Shareholders' interests are best served by reducing interest rate
risk from our business through cost effective means," David
Wilson, ACS senior vice president and chief financial officer,
stated.  "Taking advantage of current market conditions, we have
fixed interest rates on the remaining portion of our term loan by
executing a new rate swap at only 24 basis points over the current
3-month London Inter-Bank Offer Rate.  As a result, we have
reduced exposure to higher interest rates, and secured an
attractive rate through December 31, 2011, on the remainder of our
term loan."

Based in Anchorage, Alaska, Alaska Communications Systems is the
leading integrated communications provider in Alaska, offering
local telephone service, wireless, long distance, data, and
Internet services to business and residential customers throughout
Alaska.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 16, 2005,
Standard & Poor's Ratings Services revised its outlook on
Anchorage, Alaska-based incumbent local exchange carrier Alaska
Communications Systems, including Alaska Communications Systems
Group Inc., to stable from negative, based on expectations for
healthy growth in the wireless business, and improved operating
trends in the wireline segment.

These factors, coupled with declining capital expenditures as
wireless upgrades wind down, are expected to lead to a turnaround
to a positive discretionary cash flow position in mid-2006,
somewhat earlier than anticipated," said Standard & Poor's credit
analyst Allyn Arden.

All ratings, including the company's 'B+' corporate credit rating,
were affirmed.  Total debt outstanding as of Sept. 30, 2005, was
$457 million.


ALION SCIENCE: Moody's Cuts Family Rating to B2 on Low Revenue
--------------------------------------------------------------
Moody's Investors Service affirmed the B1 rating on Alion Science
and Technology Corporation's $193 million term loan B, which is
being upsized from the current level of $143 million, and affirmed
the existing B1 rating on the $30 million revolver. Moody's
concurrently lowered the corporate family rating to B2 from B1.  
The ratings outlook is stable.

The lowering of the corporate family rating reflects the increased
level of leverage pro forma for the increase in term loan B, an
aggressive acquisition policy, revenue and operating cash
generation for the fiscal year ended Sept. 30, 2005, that was
modestly below expectations, and the potential loss of a contract
that accounted for about 12% of fiscal year 2005 revenues.  The B1
rating on the senior secured credit facilities was maintained as
Moody's expects enterprise value coverage of the debt in a
distressed scenario to more than cover the amount of the secured
debt.

The ratings continue to be supported by the company's level of
free cash flow before acquisitions, $2.8 billion contract backlog,
and historical track record of win rates on new business and re-
competes, as well as the expected continued growth in defense
spending and the outsourcing of work by government agencies.

Moody's took these rating actions:

   * $30 million senior secured revolving credit facility due
     2009, affirmed B1

   * $193 million senior secured term loan B due 2009, affirmed
     B1

   * Corporate family rating, lowered to B2 from B1

   * Speculative grade liquidity rating, affirmed SGL-3.

The ratings outlook is stable.

The ratings are subject to review of final, executed documents.

Moody's expects Alion to combine the $50 million of additional
borrowings under the term loan B with $13 million in balance sheet
cash to finance the acquisition of three separate companies with
combined revenues of $59 million and to repurchase warrants valued
at $14 million.  The aggregate anticipated purchase price of $49
million represents approximately 7.8x the combined EBITDA of the
three targets for the year ended Dec. 31, 2005.  The acquisitions
are expected to close during the first calendar quarter of 2006.

Pro forma for the planned acquisitions, Alion's total debt to
EBITDA as defined in the company's credit agreement.  In addition
to $192.8 million of borrowings under the senior secured term loan
B, the company will have about $42.9 million in subordinated notes
and $29.7 million in redeemable common stock warrants remaining as
liabilities on the balance sheet.  The subordinated notes pay
interest at a rate of 6% per year through Dec. 2008 through the
issuance of non-interest bearing notes.  Beginning Dec. 2008, the
subordinated notes will bear interest at 16% per year payable
quarterly in cash.  Principal on the subordinated notes will be
payable in equal installments of $20 million in Dec. 2009 and Dec.
2010.  The non-interest bearing notes will also be due in equal
installments of $7.2 million on these same dates.  The redeemable
common stock warrants enable the holders to sell the warrants back
to the company, at predetermined times, at the then current fair
value of the common stock less the exercise price.  The earliest
date at which the warrants may be sold to the company is Dec.
2008.

Pro forma for the transactions, Moody's expects Alion to exhibit a
ratio of adjusted free cash flow to total debt of about 12%,
before acquisitions and repurchases of stock from the employee
stock ownership plan.  At the close of the transactions, Moody's
expects Alion to have about $26 million in availability under its
$30 million revolving credit facility, after giving consideration
to about $3 million in outstanding letters of credit and a $1
million draw on the revolver.  Moody's expects Alion to rely on
its revolver for quarterly working capital swings and to fund
smaller prospective acquisitions.

On August 5, 2005, Alion was notified that it had lost a US
government contract that accounted for about 12% of Alion's
revenue for the fiscal year ended Sept. 30, 2005.  Alion lodged a
protest alleging that the winning bidder had a conflict of
interest.  Although the government sustained Alion's protest on
Jan. 6, 2006, whether Alion ultimately regains the contract as
part of the government's corrective action is uncertain.  In the
meantime, Alion continues to perform under the terms of the prior
contract and has shifted approximately 50% of the work to other
long-term Alion contracts covering the same customers.

Moody's views Alion's acquisition policy as aggressive and
customer concentrations as significant.  Moody's expects Alion to
execute the near simultaneous acquisition of three companies with
combined revenues of $59 million in the very near term, which will
expand Alion's customer base.  Nonetheless, Alion will continue to
rely on the US government for over 90% of revenues, which exposes
it to the risk of change in government contracting practices.  A
large portion of its government revenues is concentrated in a
limited number of contracts.  During fiscal 2005, Alion's top five
government contracts accounted for approximately 48% of revenue.  
The termination of any of these contracts by the federal
government or the inability to replace these contracts as they
expire would materially affect cash generation and profitability.

Competition for government contracts in defense services related
to information technology is growing in intensity, which is
driving up the prices of acquisition targets and making
acquisition strategies more difficult to execute.  Although
competition to grow through acquisition raises the enterprise
values of companies competing in the sector, an industry downturn
or change in government contracting practices could reverse this
trend.  Many of the Alion's competitors are large in comparison
and have greater financial and technical resources, larger client
bases, and greater name recognition than Alion.

The ratings benefit from the company's long term contracts, a
large contract backlog relative to its size, historical win rate
on re-competes of over 90%, projected continued growth in U.S.
defense spending, and the continuing trend toward outsourcing of
work by government agencies.  Although the total backlog amounts
are large relative to the company's revenue base, there is no
guarantee that these revenues will materialize.

The stable ratings outlook reflects Moody's expectation that Alion
will be able to successfully integrate its recent and proposed
acquisitions, will benefit from the expected growth in the federal
defense budget, and will either regain or have time to ameliorate
the recent loss of a significant contract. Moody's expects the
company to continue to pursue strategic acquisitions similar in
nature to those acquired in recent years.  To the extent that
leverage rises with the rising level of purchase price multiples
in the industry, the outlook or ratings could come under pressure.

The ratings or outlook could be raised if Alion reduces total debt
to EBITDA, as defined in the credit agreement and adjusted for
operating leases, to below 5.0x on a sustained basis while
maintaining adjusted free cash flow to debt above 12%. The ratings
or outlook could be lowered, however, if Alion's acquisition
policy results in adjusted total debt to EBITDA rising above 6.5x
or integration or other operational difficulties, such as the loss
of a major contract, result in adjusted free cash flow to total
debt falling below 10%.

The affirmation of the SGL-3 speculative grade liquidity rating
reflects Moody's expectations that the company will have adequate
liquidity over the next twelve months, albeit with quarterly cash
flow volatility, potential for significant utilization of the
company's $30 million revolving credit facility, moderate cushion
under financial covenants, and little recourse to alternate
liquidity.  At the close of the three acquisitions, Moody's
expects Alion to have about $9 million in cash on hand and $26
million in availability under the revolver.  The SGL rating will
be sensitive to the ability of the company to generate stable
quarterly free cash flows, the degree of expected utilization of
the revolver, and the execution of the company's acquisition
strategy.

The B1 rating on the senior secured credit facility, one notch
above the corporate family rating, reflects the first priority
security in substantially all the tangible and intangible assets
of the company and its subsidiaries including a pledge of 100% of
the capital stock of domestic subsidiaries.  The term loan B will
continue to amortize at a rate of 0.25% a quarter through August
2008, with the balance payable in equal installments during the
last four quarters of the facility.  The credit facility has a 50%
excess cash flow sweep.

Alion Science and Technology Corporation, headquartered in McLean,
Virginia, is an employee-owned technology solutions company
delivering technical solutions and operational support to the
Department of Defense, civilian government agencies, and
commercial customers.  The company designs, integrates, maintains,
and upgrades technology solutions and products for national
defense, intelligence, homeland security, emergency response, and
other high priority government missions.  Revenue for the fiscal
year ended Sept. 30, 2005 was $369 million.


ALION SCIENCE: S&P Rates Proposed $50 Million Add-On Loan at B+
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating and
'3' recovery rating to McLean, Virginia-based Alion Science and
Technology Corp.'s proposed $50 million add-on senior secured
term loan.  At the same time, Standard & Poor's affirmed its 'B+'
corporate credit rating, and its negative outlook, as well as its
'B+' debt rating, and '3' recovery rating, on the company's
existing $173 million senior secured bank facility.
     
The senior secured debt rating, which is the same as the
corporate credit rating, along with the recovery rating, reflect
Standard & Poor's expectation of meaningful (50%-80%) recovery of
principal by creditors in the event of a payment default or
bankruptcy.
     
Proceeds from the incremental term facility, along with $13
million of cash from the balance sheet, will be used to fund three
modest-sized acquisitions and to repurchase approximately $14
million of the company's redeemable common stock warrants, which
would have been puttable in 2008.
      
"The ratings reflect Alion's relatively modest position in the
highly competitive and consolidating government IT services
market, an acquisitive growth strategy, and high debt leverage,"
said Standard & Poor's credit analyst Ben Bubeck.

A predictable revenue stream based upon a strong backlog and the
expectation that the government IT services sector will continue
to grow over the intermediate term are partial offsets to these
factors.
     
Alion is an R&D, engineering, and information technology company
that provides services and communications solutions primarily to
the federal government.  Pro forma for the proposed transaction,
Alion had approximately $340 million in operating lease-adjusted
total debt, including redeemable common stock warrants, as of
September 2005.


ALLIED HOLDINGS: Wants Cushman & Wakefield as Real Estate Broker
----------------------------------------------------------------
Allied Holdings, Inc., and its debtor-affiliates seek authority
form the U.S. Bankruptcy Court for the Northern District of
Georgia to employ Cushman & Wakefield LePage, Inc., as their
broker, nunc pro tunc to Nov. 29, 2005.

Cushman is a privately held real estate services firm with offices
in over 50 countries.  The professionals at the firm have
extensive experience in various aspects of real estate, including
buying, selling, and financing real property.

Pursuant to a brokerage agreement with the Debtors, Cushman will
have exclusive authority to market and solicit bids for the
Debtors' property in Windsor, Ontario, Canada.

According to Alisa H. Aczel, Esq., at Troutman Sanders LLP, in
Atlanta, Georgia, Cushman has marketed the Property before the
Petition Date.  Ms. Aczel discloses that the firm secured a bid
for the Property with a per-acre purchase price in excess of its
per-acre appraisal value on December 22, 2005.

Ms. Aczel relates that Cushman will have a 5% commission upon the
successful completion of a Property sale.

Cushman reports that it has not received a retainer from the
Debtors, nor did the Debtors make any prepetition payments to it.

David Woodiwiss, a salesperson at Cushman & Wakefield, assures the
Court that the people employed by the firm do not have any
connection with the Debtors, their creditors, other parties-in-
interest, the U.S. Trustee, or any person employed in the U.S.
Trustee's office.  Mr. Woodiwiss adds that Cushman does not hold
any interest adverse to the Debtors or their estates.

The firm is a "disinterested person" as defined in Section 101(14)
of the Bankruptcy Code, Mr. Woodiwiss says.

Headquartered in Decatur, Georgia, Allied Holdings, Inc. --  
http://www.alliedholdings.com/-- and its affiliates provide      
short-haul services for original equipment manufacturers and  
provide logistical services.  The Company and 22 of its affiliates  
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.  
Case Nos. 05-12515 through 05-12537).  Jeffrey W. Kelley, Esq., at  
Troutman Sanders, LLP, represents the Debtors in their  
restructuring efforts.  Anthony J. Smits, Esq., at Bingham  
McCutchen LLP, represents the Official Committee of Unsecured
Creditors.  When the Debtors filed for protection from their
creditors, they estimated more than $100 million in assets  
and debts. (Allied Holdings Bankruptcy News, Issue No. 16;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ALLIED WASTE: Moody's Holds Junk Rating on Convertible Securities
-----------------------------------------------------------------
Moody's Investors Service affirmed the long-term debt ratings of
Allied Waste North America, Inc., along with its wholly owned
subsidiary, Browning-Ferris Industries, Inc., and its parent
company Allied Waste Industries, Inc., and raised the outlook to
stable from negative.  At the same time Moody's affirmed the
Corporate Family Rating of B2.

The improvement in outlook to stable from negative reflects a more
favorable pricing environment for the industry as a whole which,
combined with the company's own pricing initiatives is driving
enhanced internal revenue growth.  Combined with increased cost
efficiencies, top line growth is expected to lead to improved cash
from operations and EBITDA margins.  The outlook change also
reflects anticipated stabilization of free cash flow starting in
2006 to debt ratios, albeit at low single digit levels.  

The stable outlook also takes into account the 2005 refinancing
exercise which provided Allied with flexibility in terms of time
and liquidity to address operational and financial challenges.  In
particular, the 2005 Credit Facility provided Allied with more
liquidity, reduced interest expense by about $20 million, and
reduced refinancing risk by prepaying $785 million of debt
maturing over the next five years and improved cushions under
financial covenant tests.  The change in outlook is also supported
by the company's efforts to drive operational efficiencies with
respect to landfill and equipment maintenance, an extension of the
company's ROIC/EBITDA-based incentive compensation plan down to
district managers and general managers, along with investments in
sales and marketing and management development.

The affirmation of Allied's long-term ratings reflects Allied's
geographic diversification, continued prominence in the US waste
market, the increased financial flexibility from the 2005 credit
facility refinancing and the anticipated stabilization of capital
expenditures as a percentage of revenues leading to modest cash
flow improvements.

The ratings continue to be constrained by the company's high
leverage with estimated adjusted debt to EBITDA ratios of about
five times as of Dec. 31, 2005, and slightly negative free cash
flow generation in 2005.  Free cash flow generation is expected to
turn positive in 2006 but will remain weak and this continues to
leave Allied vulnerable to pressure from potential price
competition on the revenue side and labor and fuel costs on the
expense side.  Although the company has made progress with its
best practices program over the last six to nine months, ongoing
implementation costs, potential fuel cost fluctuations and labor
market conditions as US unemployment drops further may put
pressure on operating margins.

Although Moody's expects ongoing improvements in free cash flow,
such improvements are likely to continue to be constrained by
interest payments, ongoing capital expenditure levels and cash
dividend payments on the preferred stock.

Sustainable improvements in free cash flow to debt ratios in the
high single digits could lead to an upgrade.  Negative free cash
flows, debt-financed acquisitions or additional indebtedness could
lead to downward pressure on the ratings.

Availability under Allied's $1.575 million committed revolving
credit facility as of December 31, 2005 was about $1.2 billion.
The facility is used for funding working capital needs and for
outstanding letters of credit.  Cash at Dec. 31, was $56 million
and Moody's expects cash from operations, unrestricted cash and
revolver usage during 2006 to provide sufficient liquidity to fund
any seasonal working capital needs.  Capital expenditures were
$696 million in 2005 and are expected to remain at these levels in
2006.  Moody's expects cash flow over the near term to cover
mandatory debt maturities.  Allied's next significant debt
maturity is in 2008 when about $1.5 billion of senior notes are
due.

These ratings were affected:

   Issuer: Allied Waste Industries, Inc.

   * Corporate Family Rating affirmed at B2;

   * $230 million issue of 4.25% senior subordinated convertible
     bonds due 2034, affirmed at Caa2;

   * $345 million issue of 6.25% senior mandatory convertible
     preferred stock -- conversion date of April 2006, affirmed
     at Caa3;

   * $600 million issue of 6.25% senior mandatory convertible
     preferred stock -- conversion date of March 2008, affirmed
     at Caa3;

   * Speculative Grade Liquidity Rating, affirmed at SGL-2;

The outlook for the ratings was raised to stable from negative.

   Issuer: Allied Waste North America, Inc.

   * $1.575 billion guaranteed senior secured revolving credit
     facility due 2010, affirmed at B1;

   * $1.275 billion guaranteed senior secured term loan due 2012,
     affirmed at B1;

   * $495 million guaranteed senior secured Tranche A Letter of
     Credit Facility due 2012, affirmed at B1;

   * $750 million issue of 8.5% guaranteed senior secured notes
     due 2008, affirmed at B2;

   * $600 million issue of 8.875% guaranteed senior secured notes
     due 2008, affirmed at B2;

   * $350 million issue of 6.5% guaranteed senior secured notes
     due 2010, affirmed at B2;

   * $400 million issue of 5.75% guaranteed senior secured notes
     due 2011, affirmed at B2;

   * $275 million issue of 6.375% guaranteed senior secured notes
     due 2011, affirmed at B2;

   * $251 million issue of 9.25% guaranteed senior secured notes
     due 2012, affirmed at B2;

   * $450 million issue of 7.875% guaranteed senior secured notes
     due 2013, affirmed at B2;

   * $425 million issue of 6.125% guaranteed senior secured notes
     due 2014, affirmed at B2;

   * $600 million issue of 7.25% guaranteed senior secured notes
     due 2015, affirmed at B2;

   * $400 million issue of 7.375% guaranteed senior unsecured
     notes due 2014, affirmed at Caa1;

   Issuer: Browning-Ferris Industries, Inc., assumed by Allied     
           Waste North America, Inc.

   * $155 million issue of 6.375% senior secured notes due 2008,
     affirmed at B2;

   * $96 million issue of 9.25% secured debentures due 2021,
     affirmed at B2;

   * $292 million issue of 7.4% secured debentures due 2035,
     affirmed at B2;

   * Approximately $284 million of industrial revenue bonds,    
     affirmed at Caa1, unless backed by letters of credit.

Allied Waste North America, Inc., a wholly owned operating
subsidiary of Allied Waste Industries, Inc., is based in
Scottsdale, Arizona.  Allied is a vertically integrated, non
-hazardous solid waste management company providing collection,
transfer, and recycling and disposal services for residential,
commercial and industrial customers.  The company had 2005
revenues of approximately $5.735 billion.


ALLSERVE SYSTEMS: Ch. 7 Trustee Taps McElroy Deutsch as Counsel
---------------------------------------------------------------
Charles A. Stanziale, Jr., Esq., the Chapter 7 Trustee for
Allserve Systems Corp., asks the U.S. Bankruptcy Court for the
District of New Jersey for permission to retain McElroy, Deutsch,
Mulvaney & Carpenter, LLP, as his counsel.

McElroy Deutsch will:

   a) collect and reduce to fund the property of the estate for
      which any trustee serves, and close any estate as
      expeditiously as is compatible with the best interests of
      parties-in-interest;

   b) be accountable for all property received;

   c) ensure that the Debtor will perform his intention as
      specified in Section 521(2)(B) of the Bankruptcy Code;

   d) investigate the financial affairs of the Debtor;

   e) examine proofs of claims and object to the allowance of
      any claim that is improper if a purpose would be served;

   f) file with the Court, with the U.S. Trustee, and with any
      governmental unit charged with responsibility for collection
      or determination of any tax arising out of any operation,
      periodic reports and summaries of the operation of any
      business, including a statement of receipts and
      disbursements, and any other information as the U.S. Trustee
      or the Court requires if the business of the Debtor is
      authorized to be operated;

   g) make a final report and file a final account of the
      administration of the estate with the Court and with the
      U.S. Trustee;

   h) continue to perform the obligations required of the
      administrator if, at the time of the commencement of the
      case, the Debtor served as the administrator (as defined in
      section 3 of the Employee Retirement Income Security Act of
      1974) of an employee benefit plan;

   i) appear in Court and represent the interests of the estate;

   j) provide litigation services to the Trustee; and

   k) provide any other legal services to the Trustee that are
      appropriate, necessary and proper in this Chapter 7 case.

Jeffrey T. Testa, Esq., a McElroy Deutsch member, discloses his
firm's professional's billing rates:

             Position                      Hourly Rate
             --------                      -----------
             Partners                      $375 - $475
             Associates                    $250 - $350
             Paraprofessionals             $125 - $150

The professionals expected to have primary responsibility for
providing services to the Debtors and their hourly rates are:

             Professional                  Hourly Rate
             ------------                  -----------
             Charles A. Stanziale, Jr.        $475
             Jeffrey Bernstein                $375
             Donald J. Crecca                 $375
             Jeffrey T. Testa                 $300

As previously reported in the Troubled Company Reporter on
Jan. 24, 2006, the Court converted the Debtor's chapter 11 case
into a chapter 7 liquidation proceeding.  Kelly Beaudin Stapleton,
the U.S. Trustee for Region 3 named Charles A. Stanziale, Jr.,
Esq., at McElroy, Deutsch, Mulvaney & Carpenter, as the chapter 7
Trustee to oversee the liquidation of the Debtor's estate.  

To the best of the Trustee's knowledge, Mr. Testa assures the
Court that McElroy Deutsch is disinterested as that term is
defined in Section 101(14) of the Bankruptcy Code.         

Headquartered in North Brunswick, New Jersey, Allserve Systems
Corp. is an outsourcing company for the IT industry.  The Debtor
filed for chapter 11 protection on November 18, 2005 (Bankr. D.
N.J. Case No. 05-60401).  Barry W. Frost, Esq., at Teich Groh
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets between 10 million to $50 million and debts between $50
million to $100 million.


AMARIN CORP: Posts $5.2 Million Net Loss in Fourth Quarter of 2005
------------------------------------------------------------------
Amarin Corporation plc (NASDAQ: AMRN) reported financial results
for the fourth quarter and full year ended Dec. 31, 2005.

For the quarter ended Dec. 31, 2005 Amarin reported a net loss of
$5.2 million compared with a net loss of $4.8 million or 13 cents
per ADS in the quarter ended Dec. 31, 2004.  The net loss for the
quarter primarily reflects Amarin's substantial investment in
research and development and intellectual property offset by
license fee revenue and a reduction in selling, general and
administrative costs.

For the year ended Dec. 31, 2005, Amarin reported a net loss of
$18.7 million compared with net income of $4.7 million for the
year ended December 31, 2004.  The operating loss from continuing
activities for the year ended Dec. 31, 2005 was $18.9 million,
compared with an operating loss from continuing activities for the
year ended Dec. 31, 2004 of $9.9 million.  The increase in this
operating loss was primarily due to Amarin's substantial
investment in research and development and intellectual property
during 2005.

Rick Stewart, chief executive officer of Amarin, commented, "2005
was a watershed year for Amarin marked by significant advances in
all activities.  We made substantial progress with all of our
development programs, successfully out-licensed one of our
pipeline programs, enhanced our management team with key hires in
critically important positions, and considerably strengthened our
balance sheet through a number of successful financings that
raised gross proceeds of $46.3 million."

"We continue to successfully implement our focused strategy of
advancing our clinical programs in Huntington's disease and other
neurodegenerative diseases while partnering our product candidates
outside of this core area of focus.  Our strengthened balance
sheet allows us to actively pursue our course and we expect to
build on our momentum throughout 2006."

At Dec. 31, 2005, Amarin had cash of $33.9 million compared to
$11.0 million at Dec. 31, 2004.  The increase in cash balances is
primarily due to the proceeds raised from financings in May and
December, and a license fee received in December less operating
cash outflows during the year.

On May 24, 2005, Amarin raised gross proceeds of $17.8 million
through the completion of a registered offering of 13.7 million
ADS's with institutional and other accredited investors.

                   Management Appointments

Three senior management and board appointments made during the
year, which further strengthened the Amarin management team;

    * Dr. Anthony Clarke as Vice President of Clinical
      Development;

    * Dr. Prem Lachman as non-executive director; and

    * Tom Maher as General Counsel and Company Secretary,

effective February 2006.

                    Discontinued activities

For the year ended Dec. 31, 2005, there were no amounts relating
to discontinued activities.  For the comparative year ended Dec.
31, 2004, Amarin earned income before interest of $21.1 million on
discontinued activities reflecting:

     (1) the results of Amarin's disposed U.S. business for the
         period from Jan. 1, 2004 to Feb. 25, 2004, being the date
         upon which the business was sold to Valeant;

     (2) an exceptional loss of $3.1 million on disposal of the
         majority of its U.S. operations and certain products to
         Valeant;

     (3) an exceptional gain of $0.75 million, representing
         receipt of the final installments of the sale proceeds on
         the disposal of Amarin's Swedish drug delivery to Watson
         in October 2003;

     (4) an exceptional gain of $24.6 million on the settlement of
         debt obligations to Elan;

     (5) the costs incurred by Amarin relating to the completion
         of safety studies on Zelapar (the rights to which are
         owned by Valeant).  Following the sale of the majority of
         Amarin's U.S. operations to Valeant in the first quarter
         of 2004, Amarin remained responsible for the cost of
         undertaking safety studies on Zelapar and was liable up
         to $2.5 million of development costs; and

     (6) the settlement of an outstanding dispute with Valeant.

                     Intangible Fixed Assets

At Dec. 31, 2005, Miraxion had an intangible asset carrying value
of $9.6 million, a decrease of $0.7 million from $10.3 million at
Dec. 31, 2004.  The decrease in the carrying value arises from
amortisation in the year.

                          Tax Relief

Under UK tax legislation, Amarin Neuroscience is eligible for
research and development tax relief.  As the company is loss
making, it can elect to surrender its eligible research and
development tax losses and in return receive a payment from the
Inland Revenue in respect of this research and development tax
relief.  In the quarter ended Dec. 31, 2005, Amarin recognized a
tax credit of $200,000 in respect of such research and development
tax relief.  At December 31, 2005, included in the company is
a total research and development tax relief receivable of
$1.3 million.

                         Transactions

On Dec. 22, 2005, Amarin concluded a private placement of 26.1
million shares and 9.1 million warrants raising gross proceeds of
$26.4 million.  Investors in the private placement included
Southpoint Capital Advisers LP, Biotechnology Value Fund LP, Fort
Mason Capital LP, Domain Public Equity Partners LP and other new
and existing institutional and accredited investors, including
certain directors and executive officers of Amarin.

On Jan. 23, 2006, Amarin entered into a definitive purchase
agreement for 800,000 shares and 300,000 warrants raising $2.1
million.

Together, these three transactions raised $46.3 million, including
$7.7 million from directors and officers of the company.  Amarin
has no debt other than working capital liabilities. Amarin is
forecast to have sufficient cash to fund operations into the
second half of 2007 and, with possible revenue from partnering
activities, potentially beyond.

Amarin Corporation plc -- http://www.amarincorp.com/-- is a  
neuroscience company focused on the research, development and
commercialization of novel drugs for the treatment of central
nervous system disorders.  Miraxion, Amarin's lead development
compound, is in phase III development for Huntington's disease,
phase II development for depressive disorders and preclinical
development for Parkinson's disease.

                        *     *     *

                     Going Concern Doubt  

PricewaterhouseCoopers LLP expressed doubt about Amarin
Corporation plc's (NASDAQSC: AMRN) ability to continue as a going
concern opinion after it audited the company's financial
statements for the fiscal year ended Dec. 31, 2004.  PwC said
that Amarin needs to secure further financing to allow the Company  
to fund its ongoing operational needs and meet its debt
obligations, raising substantial doubt about its ability to  
continue as a going concern.


AMCAST INDUSTRIAL: Court Okays Dann Pecar as Bankruptcy Counsel
---------------------------------------------------------------
Amcast Industrial Corporation and its debtor-affiliate, Amcast
Automotive of Indiana, Inc., sought and obtained authority from
the U.S. Bankruptcy Court for the Southern District of Indiana to
employ Dann, Pecar, Newman & Kleiman, P.C., as their general
bankruptcy counsel.

As previously reported in the Troubled Company Reporter, Dann
Pecar is expected to:

   1) assist and advise the Debtors with respect to their rights,
      duties and powers in their chapter 11 cases and in their
      consultations relative to the administration of their cases;

   2) assist the Debtors in analyzing claims of their creditors
      and in negotiating with those creditors and in the analysis
      of and negotiations with any third party concerning matters
      related to the terms of a proposed plan of reorganization;

   3) represent the Debtor at all Court hearing and proceedings;

   4) analyze and review all applications, orders, statements of
      operations and schedules filed with the Court and advise the
      Debtors of the propriety of those filings;

   5) assist the Debtors in preparing pleadings and applications
      as may be necessary in furthering their interests and
      objectives of their chapter 11 cases; and

   6) perform all other necessary legal services to the Debtors in
      accordance with their powers and duties pursuant to the
      Bankruptcy Code.

James P. Moloy, Esq., a member of Dann Pecar, is one of the lead
attorneys for the Debtors.  Mr. Moloy discloses that his Firm
received a $25,000 retainer.

Court records do not show how much Dann Pecar will charge the
Debtors for its professional services.

Dann Pecar assures the Court that it does not represent any
interest materially adverse to the Debtors and is a disinterested
person as that term is defined in Section 101(14) of the
Bankruptcy Code.

Headquartered in Fremont, Indiana, Amcast Industrial Corporation,
manufactures and distributes technology-intensive metal products
to end-users and suppliers in the automotive and plumbing
industry.  The Company and four debtor-affiliates previously filed
for chapter 11 protection on Nov. 30, 2004.  The U.S. Bankruptcy
Court for the Southern District of Ohio confirmed the Debtors'
Third Amended Joint Plan of Reorganization on July 29, 2005.  The
Debtors emerged from bankruptcy on Aug. 4, 2005.

Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc., filed for chapter 11 protection a second time on Dec. 1,
2005 (Bankr. S.D. Ind. Case No. 05-33323). David H. Kleiman, Esq.,
and James P. Moloy, Esq., at Dann Pecar Newman & Kleiman, P.C.,
represent the Debtors in their restructuring efforts.  When the
Debtor and its affiliate filed for protection from their
creditors, they listed total assets of $97,780,231 and total
liabilities of $100,620,855.

Amcast Industrial's chapter 11 case is jointly administered with
Amcast Automotive of Indiana, Inc.'s chapter 11 proceeding.  


AMCAST INDUSTRIAL: Hires Bracewell & Guiliani as Bankr. Co-Counsel
------------------------------------------------------------------
Amcast Industrial Corporation and its debtor-affiliate, Amcast
Automotive of Indiana, Inc., sought and obtained authority from
the U.S. Bankruptcy Court for the Southern District of Indiana to
employ Bracewell & Giuliani LLP, as their bankruptcy co-counsel.

Bracewell & Giuliani is expected to:

    a) advise the Debtors with respect to their rights, duties and
       powers in their chapter 11 cases;

    b) assist and advise the Debtors in their consultation
       relative to the administration of their chapter 11 cases;

    c) assist the Debtors in analyzing the claims of the creditors
       an in negotiating with such creditors;

    d) assist the Debtor in the analysis of and negotiations with
       any third party concerning matters relating to the terms of
       the plan of reorganization;

    e) represent the Debtors at all hearings and other
       proceedings;

    f) review and analyze all applications, orders, statements of
       operations and schedules filed with the Court and advise
       the Debtors as to the propriety;

    g) assist the Debtors in preparing pleadings and applications
       as may be necessary in the furtherance of the Debtors'
       interests and objectives; and

    h) perform such other legal services as may be required and
       deemed to in the interest of the Debtors.

The Debtors discloses that Bracewell & Guiliani received a $50,000
retainer and will hold the amount pending final approval of the
Court of the Firms' fees and expenses.

William A. "Trey" Wood, Esq., attorney at Bracewell & Guiliani's
Houston office, assures the Court that the Firm is a
"disinterested person" as that term is defined in section 101(14)
of the bankruptcy Code.

The Firm's Houston Office can be reached through:

         Bracewell & Giuliani LLP
         711 Louisiana Street, Suite 2300
         Houston, Texas 77002-2781
         Tel: (713) 223-2300
         Fax: (713) 221-1212
         http://www.bracewellgiuliani.com/


Headquartered in Fremont, Indiana, Amcast Industrial Corporation,
manufactures and distributes technology-intensive metal products
to end-users and suppliers in the automotive and plumbing
industry.  The Company and four debtor-affiliates previously filed
for chapter 11 protection on Nov. 30, 2004.  The U.S. Bankruptcy
Court for the Southern District of Ohio confirmed the Debtors'
Third Amended Joint Plan of Reorganization on July 29, 2005.  The
Debtors emerged from bankruptcy on Aug. 4, 2005.

Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc., filed for chapter 11 protection a second time on Dec. 1,
2005 (Bankr. S.D. Ind. Case No. 05-33323). David H. Kleiman, Esq.,
and James P. Moloy, Esq., at Dann Pecar Newman & Kleiman, P.C.,
represent the Debtors in their restructuring efforts.  When the
Debtor and its affiliate filed for protection from their
creditors, they listed total assets of $97,780,231 and total
liabilities of $100,620,855.

Amcast Industrial's chapter 11 case is jointly administered with
Amcast Automotive of Indiana, Inc.'s chapter 11 proceeding.  


AMERICAN COMMERCIAL: S&P Raises Corporate Credit Rating to BB-
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on American Commercial Lines Inc. (ACL) to 'BB-' from 'B'
and removed the rating from CreditWatch, where it was placed with
positive implications on Sept. 27, 2005.  The rating on subsidiary
American Commercial Lines LLC's senior unsecured notes was raised
to 'B+' from 'B-' and also removed from CreditWatch.  The outlook
is now positive.  The Jeffersonville, Indiana-based barge company
has about $330 million of lease-adjusted debt.
     
The rating actions follow a review of the impact of ACL's October
2005 IPO and subsequent debt paydown on its capital structure and
an assessment of the company's near- to intermediate-term
operating prospects.
      
"The upgrade reflects ACL's improved capital structure following
its recent IPO of common stock," said Standard & Poor's credit
analyst Lisa Jenkins.  "Standard & Poor's believes that favorable
market conditions and ACL's efficiency enhancements will allow it
to sustain improved credit protection measures even as it invests
to upgrade its fleet," the analyst continued.
     
The ratings reflect ACL's:

   * strengthened capital structure;
   * improving profitability; and
   * prominent position in the fragmented barge industry.

Offsetting these positives are:

   * the capital intensity of the business;
   * competitive end markets;
   * vulnerability to swings in demand; and
   * potential exposure to industry supply-and-demand imbalances.

ACL generates about 80% of its barge revenues from dry bulk cargo
(including grain, steel, and coal.)  The remaining 20% comes from
the transport of liquid cargo (including petroleum and chemical
products).  ACL also operates a barge manufacturing business,
which accounts for about 15% of total company revenues.
     
ACL emerged from Chapter 11 bankruptcy protection in January 2005.
While in bankruptcy, ACL rejected and renegotiated certain leases
and scrapped certain vessels, thereby improving its operating
efficiency.  Since its emergence, it has reduced overhead costs
and implemented various other measures to improve operating
performance.  It also strengthened its capital structure by
completing an IPO of common stock in October 2005.  These actions
have better positioned the company to deal with pricing and
profitability pressures that periodically occur in this industry.
     
Ratings assume that continuing favorable industry fundamentals
over the near to intermediate term combined with ongoing
initiatives to improve operating efficiency will enable the
company to sustain its improved operating performance over the
next two years.  Ratings also incorporate some room for the
company to make modest investments to upgrade and expand its
fleet.  

If ACL:

   * generates improved earnings;

   * maintains a disciplined approach to acquisitions and
     investments; and

   * sustains its current balance sheet structure

ratings could be raised.

Conversely, if the company engages in greater-than-expected
investment spending or if industry fundamentals weaken, the
outlook is likely to be revised to stable.


AMERIGAS PARTNERS: Higher Propane Prices Lift Revenues
------------------------------------------------------
AmeriGas Partners, LP, delivered its financial results for the
quarter ended Dec. 31, 2005, to the Securities and Exchange
Commission on Feb. 9, 2006.

AmeriGas earned $55 million of net income during the 2005 three-
month period, an increase of $10.7 million compared to the prior-
year period.  

Retail propane revenues increased by $67.7 million reflecting a
$75.6 million increase due to higher average selling prices
partially offset by a $7.9 million decrease due to the lower
retail volumes sold.  Wholesale propane revenues increased by $3.2
million reflecting a $9.1 million increase resulting from higher
average selling prices partially offset by a $5.9 million decrease
due to lower volumes sold.

The Partnership's retail gallons sold during the 2005 three-month
period reflect the negative effects of customer conservation
resulting from higher propane costs and selling prices and reduced
volumes sold to agricultural customers reflecting a weak crop-
drying season.

The Partnership's  results are largely seasonal and dependent upon
weather conditions, particularly during the peak-heating season,
which occurs in the first half of its fiscal year.  As a result,
net income is generally higher in the first and second fiscal
quarters whereas lower net income or net losses occur in the third
and fourth fiscal quarters.

AmeriGas' balance sheet at Dec. 31, 2005, showed $1.7 billion in
total assets, liabilities of $1.3 billion, minority interests of
$8.4 million and partners' capital of 322.9 million.

                          About AmeriGas

AmeriGas Partners, L.P. (NYSE:APU) is the nation's largest retail
propane marketer, serving nearly 1.3 million customers from over
650 locations in 46 states.  UGI Corporation (NYSE:UGI) through
subsidiaries, owns 44% of the Partnership and individual
unitholders own the remaining 56%.

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 12, 2006,
AmeriGas Partners, L.P.'s $350 million senior notes due 2016,
issued jointly and severally with its special purpose financing
subsidiary AP Eagle Finance Corp., are rated 'BB+' by Fitch
Ratings.

Fitch also affirms APU's existing senior unsecured debt rating of
'BB+' and issuer default rating of 'BB+'.  Fitch said the Rating
Outlook is Stable.

As reported in the Troubled Company Reporter on Jan. 12, 2006,
Moody's Investors Service:

   * assigned a B1 rating to AmeriGas Partners, L.P.'s proposed
     $350 million senior unsecured notes due 2016;

   * upgraded its existing $415 million of senior unsecured notes
     due 2015 to B1 from B2; and

   * affirmed its Ba3 corporate family rating.

Moody's said the rating outlook is stable.


AOL LATIN: Wants Court OK to Extend Cicerone Capital's Employment
-----------------------------------------------------------------
America Online Latin America Inc., asks the U.S. Bankruptcy Court
for the District of Delaware for permission to further extend its
employment and retention of Cicerone Capital LLC as its financial
advisors, nunc pro tunc to Dec. 1, 2005.

On Aug. 8, 2005, the Court authorized the Debtor's employment of
Cicerone Capital as its financial advisors, nunc pro tunc to
June 24, 2005.  The Debtor wants to extend the employment of
Cicerone Capital pursuant to the terms of a Second Extension
Letter dated Dec. 1, 2005.  

As reported in the Troubled Company Reporter on Aug. 8, 2005,
Cicerone Capital services include:

   a) assisting the Debtors in identifying the target, sectors,
      region and quantity of business entities and assets in Latin
      America with respect to a potential sale of the Debtors, the
      Non-Debtor Foreign Subsidiaries or their respective assets;

   b) advising and assisting the Debtors in analyzing and
      evaluating the business, operations, properties, financial
      condition, major liabilities, prospects and potential
      synergies of the Debtors and any potential purchaser;

   c) participating in discussions with the Company's directors,
      shareholders, suppliers and investment bankers and conduct
      management interviews, site visits, data analysis and due
      diligence of the Company and any potential purchaser;

   d) reviewing the documents related to any potential sale of the
      Debtors, the Non-Debtor Foreign Subsidiaries or their
      respective assets, and prepare a valuation analysis of the
      Debtors and any potential purchaser in connection with that
      potential asset sale; and

   e) providing all other financial advisory services to the
      Debtors in connection with their chapter 11 cases.

Zain A. Manekia, a managing principal at Cicerone Capital,
discloses that under the terms of the Second Letter Agreement, the
Firm will be paid:

   1) a $25,000 monthly advisory fee; and

   2) a success fee in connection with a marketing operations
      coordination agreement into between Aol Brasil, Ltda., a
      wholly-owned subsidiary of the Debtor and Terra Networks
      Brasil S.A.

Cicerone Capital assures the Court that it does not represent any
interest materially adverse to the Debtor and is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.

The Court will convene a hearing at 3:00 p.m., on Feb. 23, 2006,
to consider the Debtor's request.

Headquartered in Fort Lauderdale, Florida, America Online Latin
America, Inc. -- http://www.aola.com/-- offers AOL-branded   
Internet service in Argentina, Brazil, Mexico, and Puerto Rico,
as well as localized content and online shopping over its
proprietary network.  Principal shareholders in AOLA are
Cisneros Group, one of Latin America's largest media firms,
Brazil's Banco Itau, and Time Warner, through America Online.
The Company and its debtor-affiliates filed for Chapter 11
protection on June 24, 2005 (Bankr. D. Del. Case No. 05-11778).
Pauline K. Morgan, Esq., and Edmon L. Morton, Esq., at Young
Conaway Stargatt & Taylor, LLP and Douglas P. Bartner, Esq., at
Shearman & Sterling LLP represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection
from their creditors, they listed total assets of $28,500,000
and total debts of $181,774,000.


ARMSTRONG WORLD: Told to File 4th Amended Ch. 11 Plan by Feb. 21
----------------------------------------------------------------
The Honorable Eduardo Robreno held a status conference on
February 3, 2006, in Philadelphia, Pennsylvania.

At the request of Armstrong World Industries, Inc., the Official
Committee of Unsecured Creditors, the Official Committee of
Asbestos Claimants, and Dean M. Trafelet, the Legal Representative
for Future Asbestos Personal Injury Claimants, the District Court
established a schedule to consider confirmation of AWI's Fourth
Amended Plan of Reorganization.

Judge Robreno directed AWI to file its modified fourth amended
plan by February 21, 2006.

As previously reported in the Troubled Company Reporter, the
Modified Plan will:

     -- delete the provisions regarding the receipt of "New
        Warrants" by Equity Interests holders in Class 12; and

     -- make some technical modifications relating to the
        schedules of executory contracts.

The District Court will preside over the Confirmation Hearing,
which will commence on May 23, 2006.

The Creditors Committee acknowledges that the sole objection that
it will be pursuing at the Confirmation Hearing is that the
Modified Plan discriminates unfairly with respect to Class 6
pursuant to Section 1129(b) of the Bankruptcy Code.

However, the Creditors Committee reserves the right, whether at
the Confirmation Hearing or otherwise, to seek an order from the
District Court suspending the Confirmation Hearing or denying
confirmation of the Modified Plan based on the prospect of the
likely passage of the Fairness in Asbestos Personal Injury
Resolution Act.  Any party-in-interest will also have the right to
object to any request.

              Discovery Relating to Confirmation Hearing

The District Court will determine all discovery-related disputes
for the Confirmation Hearing pursuant to the Federal Rules of
Civil Procedure.

Judge Robreno directs the parties to serve:

   (a) written document requests in connection with the Unfair
       Discrimination Objection on or before February 17, 2006;

   (b) written responses to those document requests within
       10 days after receipt of any request; and

   (c) responsive documents not objected to within 21 days
       after receipt of those requests.

Nothing will preclude AWI from providing the other parties with
access to non-privileged documents comprising the "Baltimore
Depository," the "Insurance ADR" documents, and the documents
assembled by Kirkland & Ellis LLP before the production date.

Absent further order from the District Court, the "Insurance ADR"
materials will not include any materials that are protected by the
confidentiality order entered in the insurance ADR proceeding.  
AWI will use its best efforts to furnish to the Patties a
privilege log with respect to the K&E Documents as soon as
practicable.

Any party may serve discovery requests on third parties or non-
parties in accordance with the Federal Rules of Civil Procedure,
provided that the service will be made contemporaneously on all
other parties, and that any party receiving discovery responses or
documents will promptly notify and make available for inspection,
within three days, any documents received from a third party or
non-party.

Furthermore, Judge Robreno fixed this discovery schedule:

March 6, 2006     Parties may serve interrogatories limited
                  solely to the identity of persons with
                  knowledge of relevant information or the
                  existence or location of relevant documents

March 21, 2006    Filing of responses to interrogatories

March 31, 2006    Filing of requests for admission relating to
                  substantive topics

April 10, 2006    Filing of interrogatories and admission
                  Requests related to authenticity or
                  admissibility of documents

April 17, 2006    Deadline for responses to admission requests

April 25, 2006    Deadline for responses to interrogatories

On or before March 7, 2006, the Parties will exchange a
preliminary disclosure of the identity of non-expert witnesses
they anticipate calling on their case-in-chief at the Confirmation
Hearing.  The Parties will also exchange a preliminary list of the
names of expert witnesses they anticipate calling at the
Confirmation Hearing and a brief general description, per expert,
of the nature of that expert's testimony no later than March 20,
2006.

Depositions of non-expert witnesses may commence on March 8, 2006,
and will be concluded by April 7, 2006.  Any party that intends to
offer a non-expert witness testimony at the Confirmation Hearing
will serve and file with the District Court its non-expert witness
list not later than April 10, 2006.  Any person listed on a non-
expert case-in-chief witness list not previously deposed may be
deposed but in no event later than April 27, 2006.

                     Expert Witnesses and Reports

Judge Robreno directs any party wishing to call one or more
experts to produce a report for each expert.  Expert reports,
copies of prior non-confidential reports and testimony for each
expert will be served not later than March 27, 2006.

Any party may designate a rebuttal expert, who may be the same as
a previously designated expert, to opine on subject matters raised
in the opposition's expert reports.  All rebuttal expert reports
will be served and may be filed with the Court not later than
April 19, 2006.

Depositions of experts may commence on April 21, 2006, and will be
concluded by May 10, 2006.

                 Discovery Of Expert-Related Materials

Judge Robreno requires the Parties to produce all documents, data,
and written information that the expert relied on or considered in
forming opinions.

Judge Robreno identified categories of data, information or
documents that need not be disclosed by any party with respect to
its expert witnesses, and are outside the scope of permissible
discovery:

   (i) any notes of the expert's conversations with one or more
       attorneys for the Party offering the testimony of that
       expert;

  (ii) any notes or other writings prepared by an expert and
       not circulated by that expert;

(iii) correspondence or memos, and notes of conversations,
       between the expert and other persons employed by or
       working for the same employer as the expert; and

  (iv) drafts of the expert's reports and preliminary or draft
       calculations or data runs prepared by the expert.

The Parties will also consider and discuss potential further
limitations on the scope of expert discovery.

The Parties agree to a waiver to the extent that the specific
agreements waive disclosure requirements under Rule 26(a)(2)(B) or
(C) of the Federal Rules of Civil Procedure.

Moreover, Judge Robreno directs the Parties to serve final trial
witness and exhibit lists, as well as the Daubert motions, no
later than May 12, 2006.  Briefs related to the Confirmation
Hearing will be filed with the District Court no later than May
15, 2006.

All Parties will make designations of deposition testimony for use
at the Confirmation Hearing by May 12, 2006, and counter-
designations of deposition testimony by May 19, 2006.

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


ATRIUM COS: S&P Upgrades Corporate Credit Rating to B from CCC+
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Dallas,
Texas-based Atrium Cos. Inc. and its parent, Atrium Corp.  The
corporate credit ratings were raised two notches to 'B' from
'CCC+'.  All ratings were removed from CreditWatch where they were
first placed with negative implications on June 2, 2005.  The
outlook is stable.
     
"The rating actions follow Atrium's completion of a detailed
accounting and financial review and, subsequently, its 2004
audited financial statements, alleviating our concerns that
covenant violations could lead to a default," said Standard &
Poor's credit analyst Lisa Wright.  "The company also replaced
its previous CEO, CFO, and controller; improved its accounting
staff; established code of conduct and ethics policies; and is
implementing new financial controls and an internal audit plan.  
In addition, Atrium has delivered its 2004 financial statements,
thereby satisfying the covenants under its bank credit facility
and senior discount notes."
     
The company's accounts receivable securitization facility has an
additional covenant requiring it to maintain a minimum corporate
credit rating from Standard & Poor's and Moody's Investors
Service, which has also now been satisfied.
     
Atrium is a consolidator in the fragmented residential window
industry, with about 60% of its sales going to new construction.
     
"Relatively favorable end-market conditions and Atrium's business
position support the ratings," Ms. Wright said, "but we could
revise the outlook to negative if new construction markets or
repair and remodeling demand weaken more than we expect or Atrium
experiences significant raw-material cost increases that it cannot
pass through to customers.  We see a ratings upgrade as unlikely,
given Atrium's very aggressive financial policy, which we expect
will prevent the company from achieving meaningful debt reduction
over the intermediate term."


AUBURN ASSOCIATES: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Auburn Associates, Ltd.
        dba Tamarack Apartments
        6095 Lake Forrest Drive, N.W., Suite 270
        Atlanta, Georgia 30328

Bankruptcy Case No.: 06-61491

Chapter 11 Petition Date: February 10, 2006

Court: Northern District of Georgia (Atlanta)

Debtor's Counsel: Frank B. Wilensky, Esq.
                  Macey, Wilensky, Cohen, Wittner & Kessler LLP
                  285 Peachtree Center Avenue, NE
                  Suite 600, Marquis Two Tower
                  Atlanta, Georgia 30303
                  Tel: (404) 584-1200
                  Fax: (404) 681-4355

Estimated Assets: $4,000,000

Estimated Debts:  $5,660,000

Debtor's 18 Largest Unsecured Creditors:

   Entity                          Nature of Claim   Claim Amount
   ------                          ---------------   ------------
Twin City Security Systems         Trade Debt              $4,344
2200 Executive Park Drive
Opelika, AL 36801

Dobbs Lawn Care                    Trade Debt              $3,880
501 Webster Road, Lot 181
Auburn, AL 36832

Auburn Apartment Guide             Trade Debt              $3,360
15 Office Park Circle, Suite 211
Birmingham, AL 35223

Prosystems                         Trade Debt              $2,830
278 Lee Road, Suite 400
Opelika, AL 36804

Charter Communications             Trade Debt              $1,865

Waste Management                   Trade Debt              $1,002

Allen's Lawn Care                  Trade Debt                $750

College Directory Publishing       Trade Debt                $650

Orkin                              Trade Debt                $443

Rent.Com                           Trade Debt                $188

AnswerTek, Inc.                    Trade Debt                $157

Precision Glass Co.                Trade Debt                $155

Peaches 'N Clean                   Trade Debt                $150

Great American Business Prod.      Trade Debt                 $98

The Backyard Experience            Trade Debt                 $77

Bryant Electric Service            Trade Debt                 $68

Peachtree Business Products        Trade Debt                 $27

Federal Express                    Trade Debt                 $13


AVAYA INC: Plans to Redeem 11-1/8% Senior Sec. Notes on April 3
---------------------------------------------------------------
Avaya Inc. (NYSE:AV), will redeem for cash all of its outstanding
11-1/8% senior secured notes due 2009 on April 3, 2006.  As
provided pursuant to the indenture governing the notes, the
redemption price is $1,055.63 per $1,000 principal amount at
maturity of notes.  The current principal amount of notes
outstanding as of February 7, 2006, is approximately
$13.2 million.

A notice of redemption is being mailed by The Bank of New York,
the trustee for the notes, to all registered holders of notes.  
Copies of the notice of redemption and additional information
relating to the procedures for redemption may be obtained from The
Bank of New York by calling 1-800-254-2826.

As reported in the Troubled Company Reporter on Jan. 27, 2006, the
Company reported income from continuing operations of $71 million
in the first fiscal quarter of 2006.  

                    Share Repurchase Program

The Company repurchased 7.9 million shares of common stock during
the first fiscal quarter at an average price of $11.32, or a total
of $90 million.  Since the inception of the company's share
repurchase program during the second quarter of 2005, Avaya has
repurchased a total of 19.5 million shares at an average price of
$10.11, or a total of $197 million.  Since the inception of the
program the company has reduced its diluted common shares by three
percent.

Avaya, Inc. -- http://www.avaya.com/-- designs, builds and     
manages communications networks for more than one million
businesses worldwide, including more than 90 percent of the
FORTUNE 500(R).  Focused on businesses large to small, Avaya is a
world leader in secure and reliable Internet Protocol telephony
systems and communications software applications and services.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 31, 2005,
Standard & Poor's Ratings Services raised its corporate credit
rating on Basking Ridge, New Jersey-based Avaya, Inc., to 'BB'
from 'B+'.

"The rating upgrade reflects an improved business profile,
characterized by a better market environment for enterprise
telephony products, greater geographic and product coverage, and a
leaner cost structure, along with a stronger financial profile,
including improved profitability, sharp reductions in funded debt
and an improved liquidity position," said Standard & Poor's credit
analyst Joshua Davis.  S&P says the outlook is revised to stable.

As reported in the Troubled Company Reporter on Jan. 21, 2005,
Moody's Investors Service upgraded the senior implied rating of
Avaya, Inc., to Ba3 from B1. Moody's simultaneously withdrew the
ratings of the 11-1/8% senior secured notes that have been
substantially redeemed.  The ratings outlook is positive.

Ratings upgraded include:

   * Senior implied rating to Ba3 from B1

   * Issuer rating to B1 from B2

   * Shelf registration for senior unsecured debt and preferred
     stock to (P)B1 and (P)B3 from (P)B2 and (P)Caa1,
     respectively.

Ratings withdrawn include:

   * Senior secured notes at B1.


AXS-ONE: December 31 Balance Sheet Upside Down by $2.11 Million
---------------------------------------------------------------
AXS-One Inc., reported its financial results for the fourth
quarter and fiscal year ended December 31, 2005.

For the three months ended Dec. 31, 2005, AXS-One incurred a net
loss $1,647,000 compared to a net loss of $1,726,000 for the same
period in 2004.  For the 12 months ended Dec. 31, 2005, the
Company incurred a net loss of $8,998,000 compared to a net loss
of $5,212,000 for the 12-month period ended Dec. 31, 2005.

For the 12 months ended Dec. 31, 2005, total revenues decreased to
$32,808,000 from total revenues of $38,436,000 for the year ended
Dec. 31, 2004.

The Company had $3.6 million in cash and cash equivalents at
Dec. 31, 2005, compared to the $4.8 million reported at Dec. 31,
2004.  The Company currently has approximately $8.7 million in
cash, which increased at the end of 2005 due to the prepayment of
maintenance fees, specifically by one large customer, and a
payment associated with a Records Compliance Management order from
a major US health care provider for approximately $750,000.

For the fiscal year ended Dec. 31, 2005, AXS-One reported total
assets of $11,066,000 and total liabilities of $14,781,000.

A full-text copy of AXS-One's Feb. 9 press release outlining 2005
financial results is available for free at:

       http://ResearchArchives.com/t/s?546

Headquartered in Rutherford, New Jersey, AXS-One Inc. --
http://www.axsone.com-- is a leading provider of high performance  
Records Compliance Management solutions.  The AXS-One Compliance
Platform enables organizations to implement secure, scalable and
enforceable policies that address records management for corporate
governance, legal discovery and industry regulations such as
SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and
Gramm-Leach Bliley. AXS-One's award-winning technology has been
critically acclaimed as best of class and delivers digital
archiving, business process management, electronic document
delivery and integrated records disposition and discovery for e-
mail, instant messaging, images, SAP and other corporate records.
Founded in 1979, AXS-One has offices worldwide, including in the
United States, Australia, Singapore, United Kingdom and South
Africa.

As of Dec. 31, 2005, AXS-One stockholders' deficit widened to
$2,116,000 from a $1,024,000 deficit at Dec. 31, 2004.


BALL CORP: Fitch Affirms Senior Unsecured Notes' Ratings at BB
--------------------------------------------------------------
Fitch Ratings affirmed the ratings of Ball Corporation (BLL) as:

   -- Senior secured credit facilities at 'BB+'
   -- Issuer default rating (IDR) at 'BB'
   -- Senior unsecured notes at 'BB'

At the same time, Fitch revised the Rating Outlook to Stable from
Positive.  The ratings affect approximately $1.6 billion of debt.

The revised Outlook reflects BLL's increasing allocation of
discretionary cash flow towards capital expenditures and share
repurchases as well as lower margins.  As a result, while BLL's
credit profile remains comfortably within the current rating
category, future reduction in debt and leverage are not likely to
be substantial.  

The ratings are supported by BLL's:

   * leading market positions;
   * stability of end-markets and customers; and
   * solid free cash flow generation.

Concerns include:

   * higher energy costs;

   * price pressures in certain business segments;

   * potential leverage hikes related to acquisition activities;
     and

   * higher share repurchases.

During 2005, margins deteriorated due to higher energy and freight
costs, as well as lower volumes in certain segments.  While North
American beverage can customers are under long-term contracts that
allow BLL to pass through raw material costs, pricing has been
competitive in the food can and international packaging
businesses.  In the North American beverage can business, the loss
of some volume contributed to lower revenue and margins in 2005.
Volumes in the North American beverage cans business in 2006 are
expected to return to levels similar to 2004, as BLL regained the
volume that was lost a year ago.  Operating EBITDA during 2005 was
$704 million (12.2% EBITDA margin), down from $742 million (13.6%)
in 2004.

Capital expenditures in 2005 were $292 million, up significantly
from $196 million in 2004.  As a part of its three-year
expansion/improvement project, BLL:

   * expanded custom can capacity;

   * upgraded beverage can-end manufacturing capabilities;

   * converted a European beverage line to aluminum from steel;
     and

   * completed a new beverage can plant in Serbia.

This project started in 2005, and capital expenditures are
expected to remain high in 2006 and 2007.  As a result of margin
compression and higher capital expenditures, free cash flow
(operating cash flow minus capital expenditures minus dividends)
in 2005 fell to $225 million, compared to $301 million in 2004.
The company spent over $350 million on share repurchases in 2005,
which resulted in an increase in net debt.  

Fitch expects the company to continue to buy back shares in the
absence of good acquisition candidates.  In October 2005, the
board authorized the repurchase of up to 12 million shares.  In
2006, free cash flow is expected to be in the $210 million range,
with expected share repurchases being about $150 million.  While
BLL did not make any acquisitions in 2005, the company continues
to search for attractive opportunities.

Total debt excluding A/R securitization was approximately $1.6
billion at Dec. 31, 2005, compared to $1.7 billion at Dec. 31,
2004.  If the company does not make any acquisitions, net debt is
expected to decline modestly in 2006.

Ball Corporation manufactures metal and plastic packaging,
primarily for beverages and foods, and is also a supplier of
aerospace and other technologies and services to commercial and
governmental customers.  Major customers include:

   * Miller Brewing Company;

   * PepsiCo, Inc. and affiliates;

   * Coca-Cola Company and affiliates;

   * all bottlers of Pepsi-Cola and Coca-Cola branded beverages;
     and

   * various U.S. government agencies.


BRANDYWINE REALTY: Sells Burnett Plaza for $172 Million
-------------------------------------------------------
Brandywine Realty Trust (NYSE: BDN) entered into an agreement to
sell Burnett Plaza, a 1,024,627-square-foot office property
located in Fort Worth, Texas.  The approximately $172 million
transaction closes on Feb. 10, 2006.  The purchaser, Harvard
Property Trust, LLC, will assume the existing $114.2 million
mortgage which has a maturity date of April 2015.

In the short-term, the net proceeds to Brandywine of approximately
$58 million will be used to reduce borrowings under the Company's
revolving credit facility.  The Company's strategy is to reinvest
capital from Dallas asset sales into acquisition and development
opportunities, primarily in its Northern Virginia submarkets.

Burnett Plaza was constructed in 1983 and is approximately 97%
occupied.  After giving effect to the sale, the Company's Dallas
portfolio represents approximately 11% of the Company's total
square feet owned.

"We are very pleased to have achieved our stated Dallas market
capital recycling goal so swiftly after closing on our merger with
Prentiss Properties," Gerard H. Sweeney, president and chief
executive officer of Brandywine, stated.  "With this first
disposition in Dallas, we have reduced our investment in this
market by almost one-third.  We will continue to focus throughout
the remainder of 2006 on re-deploying capital into our core
markets."

With headquarters in Plymouth Meeting, Pennsylvania and regional
offices in Mt. Laurel, New Jersey and Richmond, Virginia,  
Brandywine Realty Trust -- http://www.brandywinerealty.com/-- is   
one of the Mid-Atlantic region's largest full service real estate
companies.  Brandywine owns, manages or has an ownership interest
in 299 office and industrial properties, aggregating 24.2 million
square feet.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 5, 2005,
Moody's Investors Service affirmed the Baa3 senior unsecured debt
rating of Brandywine Operating Partnership L.P. and Brandywine
Realty Trust's preferred stock shelf at (P)Ba1.  The rating
outlook remains stable.

These ratings were affirmed with a stable outlook:

Brandywine Realty Operating Partnership, L.P.:

   * Senior debt at Baa3
   * senior debt shelf at (P)Baa3
   * subordinated debt shelf at (P)Ba1

Brandywine Realty Trust:

   * Preferred stock shelf at (P)Ba1


BROWNING-FERRIS: Moody's Affirms Junk Rating on $284 Mil. Bonds
---------------------------------------------------------------
Moody's Investors Service affirmed the long-term debt ratings of
Allied Waste North America, Inc., along with its wholly owned
subsidiary, Browning-Ferris Industries, Inc., and its parent
company Allied Waste Industries, Inc., and raised the outlook to
stable from negative.  At the same time Moody's affirmed the
Corporate Family Rating of B2.

The improvement in outlook to stable from negative reflects a more
favorable pricing environment for the industry as a whole which,
combined with the company's own pricing initiatives is driving
enhanced internal revenue growth.  Combined with increased cost
efficiencies, top line growth is expected to lead to improved cash
from operations and EBITDA margins.  The outlook change also
reflects anticipated stabilization of free cash flow starting in
2006 to debt ratios, albeit at low single digit levels.  

The stable outlook also takes into account the 2005 refinancing
exercise which provided Allied with flexibility in terms of time
and liquidity to address operational and financial challenges.  In
particular, the 2005 Credit Facility provided Allied with more
liquidity, reduced interest expense by about $20 million, and
reduced refinancing risk by prepaying $785 million of debt
maturing over the next five years and improved cushions under
financial covenant tests.  The change in outlook is also supported
by the company's efforts to drive operational efficiencies with
respect to landfill and equipment maintenance, an extension of the
company's ROIC/EBITDA-based incentive compensation plan down to
district managers and general managers, along with investments in
sales and marketing and management development.

The affirmation of Allied's long-term ratings reflects Allied's
geographic diversification, continued prominence in the US waste
market, the increased financial flexibility from the 2005 credit
facility refinancing and the anticipated stabilization of capital
expenditures as a percentage of revenues leading to modest cash
flow improvements.

The ratings continue to be constrained by the company's high
leverage with estimated adjusted debt to EBITDA ratios of about
five times as of Dec. 31, 2005, and slightly negative free cash
flow generation in 2005.  Free cash flow generation is expected to
turn positive in 2006 but will remain weak and this continues to
leave Allied vulnerable to pressure from potential price
competition on the revenue side and labor and fuel costs on the
expense side.  Although the company has made progress with its
best practices program over the last six to nine months, ongoing
implementation costs, potential fuel cost fluctuations and labor
market conditions as US unemployment drops further may put
pressure on operating margins.

Although Moody's expects ongoing improvements in free cash flow,
such improvements are likely to continue to be constrained by
interest payments, ongoing capital expenditure levels and cash
dividend payments on the preferred stock.

Sustainable improvements in free cash flow to debt ratios in the
high single digits could lead to an upgrade.  Negative free cash
flows, debt-financed acquisitions or additional indebtedness could
lead to downward pressure on the ratings.

Availability under Allied's $1.575 million committed revolving
credit facility as of December 31, 2005 was about $1.2 billion.
The facility is used for funding working capital needs and for
outstanding letters of credit.  Cash at Dec. 31, was $56 million
and Moody's expects cash from operations, unrestricted cash and
revolver usage during 2006 to provide sufficient liquidity to fund
any seasonal working capital needs.  Capital expenditures were
$696 million in 2005 and are expected to remain at these levels in
2006.  Moody's expects cash flow over the near term to cover
mandatory debt maturities.  Allied's next significant debt
maturity is in 2008 when about $1.5 billion of senior notes are
due.

These ratings were affected:

   Issuer: Allied Waste Industries, Inc.

   * Corporate Family Rating affirmed at B2;

   * $230 million issue of 4.25% senior subordinated convertible
     bonds due 2034, affirmed at Caa2;

   * $345 million issue of 6.25% senior mandatory convertible
     preferred stock -- conversion date of April 2006, affirmed
     at Caa3;

   * $600 million issue of 6.25% senior mandatory convertible
     preferred stock -- conversion date of March 2008, affirmed
     at Caa3;

   * Speculative Grade Liquidity Rating, affirmed at SGL-2;

The outlook for the ratings was raised to stable from negative.

   Issuer: Allied Waste North America, Inc.

   * $1.575 billion guaranteed senior secured revolving credit
     facility due 2010, affirmed at B1;

   * $1.275 billion guaranteed senior secured term loan due 2012,
     affirmed at B1;

   * $495 million guaranteed senior secured Tranche A Letter of
     Credit Facility due 2012, affirmed at B1;

   * $750 million issue of 8.5% guaranteed senior secured notes
     due 2008, affirmed at B2;

   * $600 million issue of 8.875% guaranteed senior secured notes
     due 2008, affirmed at B2;

   * $350 million issue of 6.5% guaranteed senior secured notes
     due 2010, affirmed at B2;

   * $400 million issue of 5.75% guaranteed senior secured notes
     due 2011, affirmed at B2;

   * $275 million issue of 6.375% guaranteed senior secured notes
     due 2011, affirmed at B2;

   * $251 million issue of 9.25% guaranteed senior secured notes
     due 2012, affirmed at B2;

   * $450 million issue of 7.875% guaranteed senior secured notes
     due 2013, affirmed at B2;

   * $425 million issue of 6.125% guaranteed senior secured notes
     due 2014, affirmed at B2;

   * $600 million issue of 7.25% guaranteed senior secured notes
     due 2015, affirmed at B2;

   * $400 million issue of 7.375% guaranteed senior unsecured
     notes due 2014, affirmed at Caa1;

   Issuer: Browning-Ferris Industries, Inc., assumed by Allied     
           Waste North America, Inc.

   * $155 million issue of 6.375% senior secured notes due 2008,
     affirmed at B2;

   * $96 million issue of 9.25% secured debentures due 2021,
     affirmed at B2;

   * $292 million issue of 7.4% secured debentures due 2035,
     affirmed at B2;

   * Approximately $284 million of industrial revenue bonds,    
     affirmed at Caa1, unless backed by letters of credit.

Allied Waste North America, Inc., a wholly owned operating
subsidiary of Allied Waste Industries, Inc., is based in
Scottsdale, Arizona.  Allied is a vertically integrated, non
-hazardous solid waste management company providing collection,
transfer, and recycling and disposal services for residential,
commercial and industrial customers.  The company had 2005
revenues of approximately $5.735 billion.


CALPINE CORP: Wants Court to Approve Hiring of PwC as Auditors
--------------------------------------------------------------
Calpine Corporation and its debtor-affiliates require the services
of auditors.  In this regard, the Debtors selected
PricewaterhouseCoopers LLP because of the firm's extensive
knowledge and experience in providing audit services in
restructurings and reorganizations.  The Firm enjoys an excellent
reputation for services it has rendered in large and complex
Chapter 11 cases on behalf of debtors and creditors throughout the
United States.

Matthew A. Cantor, Esq., at Kirkland & Ellis LLP, in New York
City, relates that PricewaterhouseCoopers has extensive
experience in delivering audit services in Chapter 11 cases,
including, among others, Adelphia Communications Corporation,
Anchor Glass Container Corporation, Century/ML Cable Venture,
Crown Pacific Partners, KB Toys and TouchAmerica.

Accordingly, the Debtors the U.S. Bankruptcy Court for the
Southern District of New York's authority to employ
PricewaterhouseCoopers, together with its wholly owned
subsidiaries, agents and independent contractors, as their
auditors, nunc pro tunc to the Petition Date.

Under the engagement, PricewaterhouseCoopers will:

   (a) audit and review Calpine's consolidated financial
       statements at December 31, 2005, and for the year then
       ending;

   (b) obtain an understanding of Calpine's internal control over
       financial reporting, evaluate management's assessment of
       internal controls and test and evaluate the design and
       operating effectiveness of the internal controls;

   (c) analyze accounting issues and advise management regarding
       the proper accounting treatment of events;

   (d) assist in the preparation and filing of financial
       statements and disclosure documents of certain of the
       Debtors required by the Securities and Exchange Commission
       including Forms 10-K and 10-Q as required by applicable
       law or as requested by the Debtors;

   (e) assist in the preparation and filing of registration
       statements of certain of the Debtors required by the
       Securities and Exchange Commission in relation to debt and
       equity offerings;

   (f) audit certain standalone financial statements as required
       by various financing agreements;

   (g) perform a diagnostic of the control activities and control
       objectives planned to be included in a Type I SAS No. 70
       Report for certain of the Debtors;

   (h) examine the assertions by certain of the Debtors relating
       to the processes for reporting natural gas and electricity
       transaction data as it relates to those standards set
       forth in Section V "Price Reporting Guidelines" of the
       FERC Policy Statement on Natural Gas and Electric Price
       Indices, Docket Number PL03-0-00 issued July 24, 2003; and

   (i) perform other auditing and accounting services for the
       Debtors as may be necessary or desirable.

The parties' prepetition engagement letter provided for payment
to PricewaterhouseCoopers according to a fixed fee arrangement
between $11,602,000 and $12,492,000, composed of:

   * between $3,500,000 and $3,700,000 for the 2005 Group Audit;

   * between $910,000 and $1,050,000 for Quarterly Reviews;

   * between $4,200,000 and $4,750,000 for Sarbanes-Oxley work;

   * $2,892,000 for standalone audits of subsidiaries; and

   * $100,000 for audits of equity-method investments.

The Debtors' Audit Committee, composed of the Debtors' Board of
Directors, approved fees of $12,047,000, representing the mid-
point of the high and low range for the fixed fee.  This
arrangement was converted into an hourly rate structure for the
parties' postpetition Audit Engagement Letter dated December 20,
2005.

The rate per hour for PricewaterhouseCoopers bankruptcy advisors
by level of experience will be:

     Billing Category                Hourly Rate
     ----------------                -----------
     Partner                            $570
     Director/Senior Manager            $500
     Manager                            $360
     Senior Associate                   $260
     Associate                          $205

According to Steve Kitson, a partner at PricewaterhouseCoopers,
the Firm is a "disinterested person" within the meaning of
Section 101(14) of the Bankruptcy Code and as required by Section
327(a).  The Firm holds no interest adverse to the Debtors.

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.  Michael S. Stamer, Esq., at Akin
Gump Strauss Hauer & Feld LLP, represents the Official Committee
of Unsecured Creditors.  As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. (Calpine Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


CAPITAL AUTO: S&P Places BB Preliminary Rating on Class D Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Capital Auto Receivables Asset Trust 2006-1's $3.128
billion asset-backed notes series 2006-1.
     
The preliminary ratings are based on information as of
Feb. 10, 2006.  Subsequent information may result in the
assignment of final ratings that differ from the preliminary
ratings.
     
The preliminary ratings assigned to the class A-1 through A-4, B,
C, and D notes are based on credit enhancement in the form of:

   * subordinated certificates;
   * a nondeclining reserve account;
   * overcollateralization; and
   * excess spread.

The amount of subordination, as a percentage of the initial
aggregate discounted receivables balance, supporting the class A-1
through A-4, B, and C notes are:

   * 6.50%,
   * 2.50%, and
   * 1.00%, respectively.  

Additional credit support for the notes is provided by:

   * a nondeclining reserve account representing 0.50% of the
     initial aggregate discounted receivables balance;

   * overcollateralization representing 0.75% of the initial
     aggregate discounted receivables balance; and

   * excess spread.

The trust will also issue class D notes with a principal balance
of $31.513 million.  The class D notes are subordinated to the
class A, B, and C notes.
     
Preliminary ratings assigned:

Capital Auto Receivables Asset Trust 2006-1
   
      Class                 Rating           Amount (mil. $)
      -----                 ------           ---------------
      A-1                   A-1+                     510.000
      A-2a                  AAA                      450.000
      A-2b                  AAA                    1,060.000
      A-3                   AAA                      650.000
      A-4                   AAA                      252.835
      B                     A                        126.052
      C                     BBB                       47.270
      D                     BB                        31.513


CEEBRAID ACQUISITION: Case Summary & 13 Largest Unsec. Creditors
----------------------------------------------------------------
Debtor: Ceebraid Acquisition Corporation
        aka Ceebraid Signal Corporation
        250 South Australian Avenue #1003
        West Palm Beach, Florida 33401
        Tel: (561) 835-4003

Bankruptcy Case No.: 06-10417

Type of Business: The Debtor specializes in recreating residential
                  areas into boutique luxury communities.  See
                  http://ceebraidsignal.com/

Chapter 11 Petition Date: February 10, 2006

Court: Southern District of Florida (West Palm Beach)

Judge: Paul G. Hyman, Jr.

Debtor's Counsel: Luis Salazar, Esq.
                  Greenberg Traurig, P.A.
                  1221 Brickell Avenue
                  Miami, Florida 33131
                  Tel: (305) 579-0500
                  Fax: (305) 579-0717

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 13 Largest Unsecured Creditors:

   Entity                       Nature of Claim     Claim Amount
   ------                       ---------------     ------------
Moriarity, Inc.                 Purchase Agreement    $3,300,000
707 Southeast Third Avenue
Suite 400
Fort Lauderdale, FL 33316-1155

New Valley Realty               Loan                  $2,500,000
712 Fifth Avenue
New York, New York 10019

Edward Cumisky and              Purchase Agreement    $2,400,000
Amanda Hunt
931 Sunrise Lane
Fort Lauderdale, FL 33304

David Ewalt                     Purchase Agreement    $2,350,000
1785 Riverside Drive
Moore Haven, FL 33471

GZA GeoEnvironmental, Inc.      Trade Debt               $27,400

Appraisal First                 Trade Debt               $25,000

Beilinson Architects            Trade Debt               $24,272

Jen-Mark Associates, Inc.       Trade Debt               $16,682

CB Richard Ellis                Trade Debt                $7,500

Siemon & Larson, P.A.           Trade Debt                $5,513

Consulting Engineers &          Trade Debt                $2,850
Science, Inc.

Docu Solutions                  Trade Debt                   $81

West Side Reproductions         Trade Debt                   $31


CENTENNIAL COMMS: Offers to Swap Sr. Notes for Registered Bonds
---------------------------------------------------------------
Centennial Communications plans to exchange its Senior Floating
Rate Notes and Senior Notes for registered bonds.

The Company offers to exchange $350 million aggregate principal
amount of Senior Floating Rate Notes due 2013 CUSIPS 15133VAD1 and
U12968AC3 for registered bonds (CUSIP 15133VAE92) of the same
aggregate principal amount and with the same terms of the old
notes.

The Company also offers to exchange $200 million aggregate
principal amount of 10% Senior Notes due 2013 CUSIPS 15133VAF6 and
U13968AD1 with registered bonds (CUSIP 15133VA41) of the same
aggregate principal amount and with the same terms of the old
notes.

The terms of each series of Exchange Bonds are substantially
identical to those of the applicable series of outstanding
Restricted Bonds, except that the transfer restrictions,
registration rights and additional interest provisions relating to
the Restricted Bonds do not apply to the Exchange Bonds.
  
The Company will not receive any proceeds from the exchange
offers.  There is no established trading market for the Exchange
Bonds, although the Restricted Bonds currently trade on the Portal
Market, Centennial says.

Restricted Bonds tendered in the exchange offers must be in
denominations of principal amount of $2,000 and any integral
multiple of $1,000.

The Notes are senior unsecured indebtedness of the Company ranking
pari passu with all of the Company's other existing and future
unsubordinated obligations.  The Notes are effectively junior to
the Company's secured obligations to the extent of the value of
the Company's assets securing the obligations.  

After giving effect to the exchange offer as if each had occurred
on November 30, 2005:
   
   -- there would have been $550.0 million outstanding under the
      senior credit facility and $60.6 million outstanding of
      capitalized leases and tower obligations, all of which was
      secured indebtedness;

   -- there would have been $500.0 million outstanding under the
      2013 Senior Notes, $325.0 million outstanding under the 2014
      Senior Notes and $550.0 million outstanding under the
      Restricted Bonds, all of which was senior unsecured
      indebtedness;
  
   -- there would have been $145.0 million outstanding under the
      2008 Senior Subordinated Notes, all of which was
      subordinated indebtedness; and
  
   -- Centennial's Subsidiaries would have had total Indebtedness
      and other liabilities of approximately $2.4 billion,
      including Indebtedness on which Centennial is a co-obligor,
      all of which would be effectively senior to the Notes.

A full-text copy of Centennial's Registration Statement is
available for free at http://ResearchArchives.com/t/s?547

Based in Wall, N.J., Centennial Communications, (NASDAQ: CYCL) --
http://www.centennialwireless.com/-- is a leading provider of
regional wireless and integrated communications services in the
United States and the Caribbean with approximately 1.3 million
wireless subscribers and 326,400 access lines and equivalents.
The U.S. business owns and operates wireless networks in the
Midwest and Southeast covering parts of six states.  Centennial's
Caribbean business owns and operates wireless networks in Puerto
Rico, the Dominican Republic and the U.S. Virgin Islands and
provides facilities-based integrated voice, data and Internet
solutions.  Welsh, Carson, Anderson & Stowe and an affiliate of
the Blackstone Group are controlling shareholders of Centennial.

At Nov. 30, 2005, Centennial Communications' balance sheet
showed a $490,868,000 stockholders' deficit, compared to a
$518,432,000 deficit at May 31, 2005.


CENTRAL PARKING: Earns $17.9 Mil. in First Quarter Ended Dec. 31
----------------------------------------------------------------
Central Parking Corporation (NYSE: CPC) reported earnings from
continuing operations for the first quarter ended Dec. 31, 2005,
of $17 million compared with $6.6 million earned in the first
quarter of the previous fiscal year.  Net earnings for the first
quarter of fiscal 2006 were $18 million compared with $2.9 million
in the year earlier period.

"Earnings from continuing operations for the first quarter of
fiscal 2006 exceeded our expectations," Emanuel Eads, President
and Chief Executive Officer said.  "Our program of opportunistic
property sales again was accretive, generating approximately
$41 million in proceeds and $23.0 million in pre-tax, property
related gains during the quarter.  Our efforts to reduce costs
also produced positive results as cost of management contracts
decreased by $4.4 million, resulting in a significant improvement
in management contract margins.  Excluding $2.8 million in costs
relating to the recently completed United Kingdom investigation,
general and administrative costs decreased from $18.9 million in
the first quarter of last year to $18.1 million, or 11% of
revenues.

"As planned, revenues were lower than the first quarter of last
year primarily due to closed locations, including a number of low
margin and unprofitable locations that were closed as part of our
initiative to improve profit margins.  Revenues also were reduced
by several other factors, including the reclassification of
certain locations from leased to management and the effects of
Hurricanes Katrina and Wilma ($2.2 million).  The Dutch Auction
tender offer was successfully completed during the quarter
resulting in the purchase of approximately 13% of the Company's
outstanding shares of common stock for an aggregate purchase price
of $75.3 million.  Proceeds from property sales were used to
reduce debt incurred in connection with the tender offer resulting
in a net increase in debt of $49.1 million in the quarter."

"We are moving ahead with the execution of other components of the
strategic plan we announced in August.  Several marginal and low
growth markets have been divested and we expect to divest
additional domestic and international markets in the coming
months.  Our initiative to target non-traditional parking market
segments with significant growth potential continues on track with
the recent renewal of two major privatized toll road contracts,
the Chicago Skyway and the Orange County toll road system.  The
extension of these two contracts is a strong endorsement of our
ability to manage toll collection services for major toll road
systems.  Additionally, our USA Parking subsidiary, which targets
the hospitality valet market, continues its expansion with the
recent signing of contracts to manage parking operations at the
LAX Sheraton, the Westin Ft. Lauderdale and the new Mandarin Hotel
currently under construction in Chicago."

"Overall, we are pleased with the results of the quarter.
Operating earnings, excluding property gains, were on plan for the
first quarter but we still have much work ahead as we continue the
execution of our strategic plan.  We expect to exceed our earlier
guidance of $0.50 to $0.57 for earnings from continuing  
operations, including property-related gains or losses, for fiscal
2006 due primarily to the higher than expected property gains
during the first quarter," Eads concluded.

A full-text copy of Central Parking Corporation's quarterly
financial reports for the first quarter ended Dec. 31, 2005, is
available at no charge at http://ResearchArchives.com/t/s?54b

Headquartered in Nashville, Tennessee, Central Parking Corporation
is a leading global provider of parking and transportation
management services.  As of June 30, 2005, the Company operated
more than 3,400 parking facilities containing more than 1.5
million spaces at locations in 37 states, the District of
Columbia, Canada, Puerto Rico, the United Kingdom, the Republic of
Ireland, Mexico, Chile, Peru, Colombia, Venezuela, Germany,
Switzerland, Poland, Spain, Greece and Italy.

                            *   *   *

Moody's Investor Service rates Central Parking Corporation's LT
Corporate Family Rating and Bank Loan Debt Rating at Ba3.

Standard and Poor's rates Central Parking Corporation's LT Foreign
Issuer Credit Rating and LT Local Issuer Credit Rating at B+.


CHAMPION ENTERPRISES: Releases Financials for Fourth Quarter 2005
-----------------------------------------------------------------
Champion Enterprises, Inc. (NYSE: CHB) reported results for the
fourth quarter and fiscal year ended Dec. 31, 2005.  

Revenues for the quarter increased 44% to $375.5 million,
compared to $260.1 million for the fourth quarter of 2004.  Income
from continuing operations increased 67% to $6.2 million, compared
to $3.7 million.  Net income in the fourth quarter of 2005 was
reduced $9.0 million, for the previously announced cost of debt
retirement.

Revenues for the full year 2005 increased 25% to $1.27 billion,
compared to $1.01 billion reported for 2004.  Income from
continuing operations in 2005 increased 82% to $42.2 million
compared to $23.1 million last year.  Net income for 2005
increased 122% to $37.8 million, versus $17.0 million in 2004.

                  Fourth Quarter 2005 Highlights

   -- Manufacturing net sales increased 38%, to $350.2 million,
      from $253.7 million in the fourth quarter of 2004.  These
      results were favorably impacted by the shipment of 1,372
      manufactured homes to the Federal Emergency Management
      Association in the fourth quarter, representing revenues
      totaling approximately $47 million.  The remaining 628 homes
      have now been shipped, and represent revenues totaling
      approximately $22 million that will be recorded in the first
      quarter of 2006;

   -- Excluding shipments to FEMA, manufacturing net sales
      increased 19% for the fourth quarter;

   -- Manufacturing segment income for the fourth quarter climbed
      75%, to $27.0 million, from $15.4 million in the fourth
      quarter of 2004;

   -- The Company reported manufacturing margins of 7.7%, compared
      to 6.1% in the fourth quarter of 2004, making this the
      company's eleventh consecutive quarter of year-over-year
      improving segment margins;

   -- Revenues from the sale of modular homes increased 78% to
      $83.2 million, or approximately 24% of manufacturing
      revenues, during the fourth quarter of 2005, compared to
      $46.8 million, or approximately 19% of manufacturing
      revenues, for the same period last year;

   -- Backlogs at the end of 2005 totaled approximately
      $147 million, compared to $90 million at the prior year-end
      and $170 million at the end of the third quarter of 2005
      (excluding the FEMA order);

   -- Champion's average selling price per home increased 4% to
      $45,600, resulting both from continued increases in raw
      material costs and a greater mix of modular homes sold,
      despite the impact of the lower average selling price of the
      FEMA homes shipped during the quarter;

   -- The Company's California-based retail segment sales
      increased 24% to $34.6 million, compared to $28.0 million
      for the fourth quarter of 2004.  Retail segment income was
      $2.1 million for the quarter, compared to $1.3 million in
      the prior year quarter;

   -- During the fourth quarter of 2005, Champion completed its
      tender offer and consent solicitation for its 11-1/4% Senior
      Notes due 2007.  In connection with the tender, the Company
      entered into a new $200 million credit facility to finance
      the tender, provide working capital through a revolving
      credit facility and a back up credit facility to support the
      Company's letters of credit.

   -- Cash used for continuing operations was $1.3 million for the
      quarter driven by a significant increase in working capital.
      The company's contract with FEMA negatively impacted year-
      end investment in working capital by an estimated
      $17 million, all of which is expected to reverse during the
      first quarter of 2006.  This was caused by higher year-end
      inventory and receivables as a result of FEMA's inability to
      take delivery of all 2,000 homes as scheduled;

   -- Cash and cash equivalents were approximately $127 million at
      quarter end; and

   -- Tax loss carryforwards total approximately $180 million as
      of the end of 2005.

Champion elected in the fourth quarter to adopt SFAS 123(R),
"Share-Based Payment".  The adoption of SFAS 123(R) calls for the
valuation of qualifying stock compensation at the grant date share
price.  The adoption was effective as of the beginning of 2005 and
required the restatement of previously reported quarters in 2005.  
An aggregate reduction in stock compensation expense totaling
$1.3 million was recorded, including $1.4 million in the third
quarter of 2005, resulting in restated income from continuing
operations for that quarter.

"During the fourth quarter, we made significant strides in
increasing our modular home sales, while continuing to focus on
operational improvements and improving our balance sheet," William
Griffiths, president and CEO of Champion Enterprises, Inc., said.   
"In response to the call from FEMA for manufactured homes, we
quickly produced 2,000 homes in 13 different factories and, as a
result, we were able to meet our customers' demand for our other
products.  We remain focused on our lean manufacturing program and
driving continued margin improvement, despite the ongoing
challenge of higher raw materials costs."

"In 2005 we demonstrated tremendous progress on many fronts --
increasing revenues and earnings, further strengthening our
balance sheet, and improving our manufacturing margins, which
reached 7.6 percent for the year -- and we continue to be
enthusiastic about our future," Griffiths said.  "There is
still much to accomplish and we expect our substantial momentum to
continue into 2006 in our effort to build a better Champion."

"Looking ahead, we are encouraged by the strength we continue to
see in many of our regional operations.  Our backlogs remain
strong, and we believe that our modular homes are well positioned
to play a prominent role later in 2006 as the Gulf Coast
rebuilding begins in earnest.  In the meantime, we remain focused
on driving shareholder value through improved fundamentals and
redeployment of our substantial cash resources," Griffiths
concluded.

Headquartered in Auburn Hills, Michigan, Champion Enterprises,
Inc. -- http://www.championhomes.com/-- a manufacturer of  
factory-built housing, has produced more than 1.6 million
homes through its family of homebuilders since 1953.  Champion
operates 32 manufacturing facilities in North America and partners
with over 3,000 independent retailers, builders and developers.

                            *   *   *

As previously reported in the Troubled Company Reporter on Jan. 9,
2006, Standard & Poor's Ratings Services raised its rating on the
7.625% senior notes due 2009 from Champion Enterprises Inc.
(Champion; B+/Positive/--) to 'B+' from 'B-'.  At the same time,
the rating is removed from CreditWatch with positive implications,
where it was placed Oct. 7, 2005.


COLLINS & AIKMAN: Wants to Modify JPMorgan DIP Loan Agreement
-------------------------------------------------------------
Collins & Aikman Corporation and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Eastern District of Michigan to a
approve a third amendment of their DIP Credit Agreement with
JPMorgan Chase Bank, NA, and certain other lenders.  According to
the Debtors, the amendment will ensure that they are able to
consummate certain IP transactions and remain in full compliance
with the DIP Credit Agreement.

The Debtors have interests in intellectual property, which:

    (i) will be licensed or assigned to IAC Acquisition
        Corporation Limited in exchange for various licensing
        agreements and other consideration, including $11,046,686
        cash, pursuant to a Master Sale Agreement Relating to the
        Business of Collins & Aikman Group Companies (In
        Administration), dated as of November 28, 2005, with the
        English court-appointed administrators of Collins &
        Aikman Europe S.A. and its affiliated European debtors;
        and

   (ii) may be licensed or assigned to certain prospective buyers
        of assets subject to the U.K. Administration in exchange
        for various licensing agreements and other consideration,
        including $1,453,314 cash.

The Debtors are also seeking to sell 100% of their equity
interest in Collins & Aikman MOBIS, LLC -- a non-debtor joint
venture between Collins & Aikman Products Co. and Hyundai MOBIS
-- and receive repayment of related intercompany obligations
aggregating $8,382,000.

The Debtors also seek to monetize certain annuity contracts
underlying Products' prepetition Supplemental Employee Retirement
Program and utilize cash held in certain of Products' rabbi trust
accounts for $6,600,000.

However, in its current form, the Amended and Restated Revolving
Credit, Term Loan and Guaranty Agreement, among the Debtors,
JPMorgan Chase Bank, NA, and certain other lenders, restricts the
Debtors' ability to sell certain assets.  Consequently, the IP
Transaction requires the approval of the DIP Lenders.

In this regard, the Debtors and the DIP Lenders worked to
structure and negotiate a reasonable amendment to the DIP Credit
Agreement that accommodates the Debtors' ongoing operational
requirements.  The parties engaged in extensive arm's-length
negotiations concerning the terms of the Amendment and the
reasonable amount of an amendment fee.

Marc J. Carmel, Esq., at Kirkland & Ellis LLP, in New York, tells
the Court that the Amendment is also necessary to permit the
Debtors to:

   -- engage in certain other transactions currently restricted;

   -- modify provisions governing the sharing of proceeds the
      Debtors receive from certain transactions;

   -- increase the Debtors' ability to sell, dispose of and
      transfer certain non-core assets; and

   -- continue the moratorium on the Borrowing Base, as defined
      in the DIP Credit Agreement.

The material terms of the Amendment are:

A. Consent to Certain Transactions

   The DIP Lenders consent to:

   (1) the IP Transaction and certain similar transactions with
       prospective buyers of assets of the Debtors' European
       subsidiaries;

   (2) the sale of 100% of the Debtors' equity interest in
       Collins & Aikman MOBIS;

   (3) the monetization and collection of assets held by the
       Debtors in connection with the prepetition supplemental
       employee retirement program, including the monetization of
       the rabbi trust accounts;

   (4) the dissolution of Waterstone Insurance, Inc., a non-
       Debtor subsidiary of Products; and

   (5) the sale of 100% of the Debtors' equity interest in a
       non-Debtor European subsidiary.

B. Application of Proceeds

   (1) With respect to the consented transactions, the Amendment
       sets forth the allocation of the proceeds between the
       Debtors and the Lenders and the parameters regarding the
       Debtors' use of those proceeds.

   (2) With respect to amounts received by the Debtors from their
       claims and interests in their European subsidiaries, the
       proceeds will be escrowed pending agreement among the
       requisite Lenders, the Debtors and the Agent for the
       application of those amounts.

C. Modifications to Negative Covenants

   (1) The Amendment modifies the negative covenant restricting
       the Indebtedness incurred by certain of the Debtors'
       foreign subsidiaries to allow the Debtors to incur
       additional Indebtedness.

   (2) The Amendment modifies the negative covenant restricting
       the Indebtedness incurred by the Debtors to allow the
       recharacterization as a capitalized lease of operating
       leases in Hermasillo, Mexico.

   (3) The Amendment modifies the negative covenant restricting
       the Debtors' ability to dispose of surplus or uneconomical
       assets by increasing the aggregate amount of those assets
       from $2,500,000 to $7,500,000.

   (4) The Amendment modifies the negative covenant restricting
       the Debtors' ability to dispose of assets and make
       investments in foreign subsidiaries by allowing the
       Debtors to dispose of or transfer equipment having a net
       book value up to $10,000,000 to certain foreign
       subsidiaries.

D. Other Modifications

   (1) To accommodate the Debtors' expected operational needs,
       the Amendment suspends the Borrowing Base through
       September 30, 2006.

   (2) The Amendment includes certain conditions to effectiveness
       of the Amendment, including the approval of Required
       Lenders and payment of an amendment fee to each Lender
       that executes the Amendment by February 8, 2006, of an
       amount equal to 0.125% of the outstanding principal amount
       of the Lender's Tranche B Loans and Tranche A Commitment.  
       In addition, the Debtors are required to pay JPMorgan an
       arrangement fee.

Mr. Carmel relates that in addition to providing the Debtors with
additional liquidity by allowing them to share in the proceeds
from disposition of the Lenders' collateral, the Amendment
permits the Debtors flexibility to make certain investments,
transfers and dispositions of non-core assets to allow them to
more productively use their assets.

"The Amendment, including the Debtors' payment of the Amendment
Fee . . . is an important component of the Debtors' ongoing
restructuring efforts," Mr. Carmel says.  

A full-text copy of the Third Amendment is available for free at
http://researcharchives.com/t/s?54c

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).  Richard M. Cieri, Esq., at Kirkland & Ellis LLP,
represents C&A in its restructuring.  Lazard Freres & Co., LLC,
provides the Debtor with investment banking services.  Michael S.
Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents
the Official Committee of Unsecured Creditors Committee.  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. 24; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


COMPANHIA ENERGETICA: Moody's Rates $800 Million Term Notes at B3
-----------------------------------------------------------------
Moody's Investors Service assigned a B3 foreign currency rating to
Companhia Energetica de Sao Paulo's $800 million Medium Term Notes
Program, governed by UK law.  Notes issued under the MTN Program
will be issued as rule 144A securities or outside the United
States under Regulation S and will constitute unsecured
unsubordinated obligations of the issuer.  Concurrently, Moody's
affirmed CESP's B2 global local currency corporate family rating.
The ratings' outlook is stable.

The B3 FC rating assigned to the company's USD 800 million
unsubordinated unsecured Medium-Term Notes Program reflects the B2
GLC corporate family rating of CESP and the structural
subordination of the notes issued under the MTN Program to the
existing secured debt of CESP, estimated at about 25% of the
company's total adjusted debt as of Sept. 30, 2005.  The B3 FC
rating of the MTN Program is not constrained by Brazil's current
Ba3 sovereign ceiling.

Recently CESP was assigned a B2 GLC corporate family rating, which
was based on Moody's rating methodology for Government
-Related Issuers.  CESP's GLC corporate family rating reflects its
baseline rating and incorporates Moody's view of the medium
default dependence between CESP and the State of Sao Paulo in
addition to Moody's expectation of a medium level of support that
would be provided by the State if the company were to require an
extraordinary bailout.

The baseline rating of CESP reflects Moody's view of the very high
fundamental credit risk of CESP, and consequently, of a high
likelihood that the company will require an extraordinary bailout
in the foreseeable future.  To a large extent, this is based on
the high refinancing risk deriving from its excessive indebtedness
when compared to cash flow generation.  The baseline rating also
incorporates the company's significant devaluation and interest
rate risks, the hydrology risk, and the still existing
uncertainties related to Brazil's regulatory framework. The
baseline rating is, however, supported by the company's position
as Brazil's second largest power generator and its strong
operating margins.

Headquartered in Sao Paulo -- Brazil, CESP is the country's second
largest power generator, majority owned by the State of Sao Paulo.  
CESP operates 6 hydroelectric plants with total capacity of 7,456
MW and reported net revenues of BRL 1,914 million in the last 12
months through Sept. 30, 2005.


CONEXANT SYSTEMS: Jury Returns $112 Mil. Verdict in Patent Dispute
------------------------------------------------------------------
Conexant Systems, Inc. (NASDAQ: CNXT), reported a jury in the U.S.
District Court for the District of New Jersey reached a verdict on
patent infringement counterclaims filed by Texas Instruments,
Inc., Stanford University and its Board of Trustees, and Stanford
University OTL, LLC (Texas Instruments) and found that
GlobespanVirata, now a subsidiary of Conexant, willfully infringed
three patents related to asymmetric digital subscriber line (ADSL)
technology.

In June 2003, GlobespanVirata, which merged with Conexant in
February 2004, filed a complaint against Texas Instruments in the
U.S. District Court for the District of New Jersey claiming that
Texas Instruments violated U.S. antitrust law by creating an
illegal patent pool, manipulating the patent process, and abusing
the process for setting standards related to ADSL technology. In
August 2003, Texas Instruments filed counterclaims alleging that
GlobespanVirata infringed certain ADSL patents.  In mid-2004, the
case was split into two phases, patent and antitrust, with the
patent phase going to trial first.  Upon the merger of
GlobespanVirata and Conexant in February 2004, Conexant inherited
this legal dispute.

The trial on the patent phase commenced on Jan. 4, 2006, in
federal district court in Trenton, New Jersey.  The jury announced
its verdict and awarded $112 million in damages to Texas
Instruments, which the judge in the case has the authority to
enhance.

In this two-phase case, no payment of damages, whether from
Conexant to Texas Instruments, or from Texas Instruments to
Conexant, will be required until the conclusion of the second
phase. The jury trial for the second phase is currently scheduled
for October of this year.

"We are extremely disappointed with the jury's verdict in the
first phase of the case and plan to file several post-trial
motions and an appeal," said Dennis O'Reilly, Conexant senior vice
president and chief legal officer.  "The second phase of the case,
which we believe involves a serious violation of U.S. antitrust
law by Texas Instruments, is scheduled to begin in the fall.
Should we prevail on all claims in the antitrust phase, the
damages awarded today would be eliminated, and we would expect
significant damages to be awarded to Conexant from Texas
Instruments."

Conexant Systems, Inc. -- http://www.conexant.com/-- is a
fabless semiconductor company.  The company has approximately
2,400 employees worldwide, and is headquartered in Newport Beach,
California.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 20, 2004,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Newport Beach, California-based Conexant Systems, Inc.,
to 'B-' from 'B' on projections of sharply reduced sales and
profitability over the next few quarters.  The outlook is
negative.


CUMMINS INC: Gets SEC Order on Financial Reporting Violations
-------------------------------------------------------------
The United States Securities and Exchange Commission entered an
administrative cease and desist order pursuant to which it found
that Cummins Inc. had violated certain financial reporting, books
and records and internal controls provisions of the federal
securities laws and ordered the Company not to violate those
provisions in the future.  

The February 7, 2006, cease and desist order was entered with the
Company's consent, and it brought to a close an informal inquiry
by the SEC staff that had commenced in January 2003 when the
Company disclosed the existence of a potential understatement of
its historical accounts payable accounts, which, after a re-audit
of the Company's historical financial results, was corrected when
the Company filed its 2002 Form 10-K, including restated results
for 2000 and 2001, on August 4, 2003.  The SEC did not find that
the Company had violated the anti-fraud provisions of the federal
securities laws, and the Company will not be required to pay any
fine or penalty in connection with the settlement.  The Company
cooperated fully with the SEC staff throughout the course of its
informal inquiry.

Cummins Inc. -- http://www.cummins.com/-- a global power leader,     
is a corporation of complementary business units that design,
manufacture, distribute and service engines and related
technologies, including fuel systems, controls, air handling,
filtration, emission solutions and electrical power generation
systems.  Headquartered in Columbus, Indiana, (USA) Cummins serves
customers in more than 160 countries through its network of 550
Company-owned and independent distributor facilities and more than
5,000 dealer locations.  With more than 28,000 employees
worldwide, Cummins reported sales of $8.4 billion in 2004.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 20, 2005,
Moody's Investors Service raised its rating of Cummins Inc.'s debt
securities (senior unsecured to Ba1 from Ba2), and also affirmed
the company's Ba1 corporate family rating and SGL-1 speculative
grade liquidity rating.  The rating outlook is changed to positive
from stable.

As reported in the Troubled Company Reporter on Aug. 5, 2005,
Standard & Poor's Ratings Services raised its rating on the
$28,000,000 Structured Asset Trust Unit Repackagings Cummins
Engine Co. Debenture-Backed Series 2001-4 certificates to 'BBB-'
from 'BB+'.


DIRECTED ELECTRONICS: S&P Upgrades Corporate Credit Rating to BB-
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Directed Electronics Inc. (DEI) to 'BB-' from 'B+' and
removed the ratings from CreditWatch with positive implications,
where they were placed on Nov. 29, 2005.  

At the same time, Standard & Poor's raised its rating on DEI's
senior secured credit facility to 'BB-' from 'B+'.  The '3'
recovery rating assigned to the senior secured facility was
affirmed.  The rating outlook is stable.
      
"The upgrades reflect DEI's more conservative financial policy,
including a stronger balance sheet and greater financial
flexibility following its December 2005 IPO of common shares,
which was followed by debt reduction," said Standard & Poor's
credit analyst Nancy C. Messer.  "In addition, the company made a
third amendment to its senior credit facility, effective Sept.
21, 2005, that enhanced its liquidity by increasing the revolving
credit facility commitment and term-loan size."
     
Vista, California-based DEI had pro forma total balance sheet
debt, reflecting debt reduction following the IPO, of $200 million
at Sept. 30, 2005.  Proceeds of the stock offering were used to
fully prepay both the company's unrated $37 million senior
subordinated notes and its unrated $37 million junior subordinated
notes.  Additional funds from the offering were used to terminate
a management agreement with unrated Trivest Partners LP.  Trivest,
which bought a controlling stake in DEI in 1999, will remain a
shareholder.
     
DEI's credit protection measures improved significantly following
the IPO.  However, DEI will still be characterized by an
aggressively leveraged financial profile and vulnerable business
profile.  Standard & Poor's ratings incorporate the assumption
that DEI's financial controls will be brought into compliance with
requirements in the near term, since the company has identified
certain material weaknesses in its internal control over financial
reporting.  Toward this end, the financial management team was
recently augmented with a new CFO having relevant experience with
a publicly traded company.
     
DEI is the world's largest designer and marketer of consumer-
branded, professionally installed electronic automotive vehicle
security and convenience systems.  The company also makes and
markets premium home audio equipment and certain SIRIUS-branded
satellite radio products marketed to consumers.  Auto security and
convenience products are the largest contributors to DEI's
revenues, followed by:

   * SIRIUS-branded products,
   * mobile audio and video products, and
   * home audio products.


DWJ ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: DWJ Enterprises, Inc.
        dba Buchanan Visual Communications
        12400 Ford
        Dallas, Texas 75234

Bankruptcy Case No.: 06-30586

Type of Business: The Debtor is a Dallas-based printing company
                  that specializes in commercial advertising and
                  Web printing.  See
                  http://www.buchananvisual.com/

Chapter 11 Petition Date: February 13, 2006

Court: Northern District of Texas (Dallas)

Judge: Barbara J. Houser

Debtor's Counsel: Eric A. Liepins, Esq.
                  Eric A. Liepins, P.C.
                  12770 Coit Road, Suite 1100
                  Dallas, Texas 75251
                  Tel: (972) 991-5591
                  Fax: (972) 991-5788

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                                 Claim Amount
   ------                                 ------------
Unisource                                     $856,350
P.O. Box 849089
Dallas, TX 75284-9089

Clampitt Paper Company of Dallas              $418,817
9207 Ambassador Row
Dallas, Texas 75247

American Express (Corporate)                  $293,689
200002 North 19th Avenue
Phoenix, Arizona 85027

RIS Paper/Paper USA                           $257,923
1705 Suckle Highway
Pennsauken, NJ 08110

BRW Paper Co., Inc.                           $176,945

Printer's Service                             $127,160

Enovation Graphics Systems, Inc.              $125,142

INX International Ink Co.                      $97,115

Carrollton-Farmers Branch ISD                  $86,478

American Express (Corporate Executive)         $78,365

Dallas County Tax Assessor-Collector           $53,400

Graphic Converting Ltd.                        $50,536

Suez Emergency Resources NA, Inc.              $50,082

Goelzer Industries                             $46,641

AFCO Credit Corporation                        $38,126

People's Capital & Leasing Corp.               $34,249

First Choice Power                             $31,786

Team Air Express, Inc.                         $33,294

Sterling Personnel Services                    $32,000

Xpedx                                          $28,521


EMMIS COMMS: Will Redeem Remaining $120M of Sr. Notes on Mar. 9
---------------------------------------------------------------
Emmis Communications Corporation called for redemption the
remaining $120 million aggregate outstanding principal amount of
its Floating Rate Senior Notes due 2012, pursuant to the terms of
the Indenture, dated June 21, 2005, between the Company and The
Bank of Nova Scotia Trust Company of New York, as trustee.  

As reported in the Troubled Company Reporter on Dec. 29, 2005, the
Company first called for redemption of $230 million aggregate
outstanding principal amount of its Floating Rate Senior Notes.  
$110 million aggregate outstanding principal amount of the notes
were redeemed on Jan. 23, 2006.  

The Notes will be redeemed on March 9, 2006.  The redemption price
for the Notes to be redeemed is $1,000.00 per $1,000 in aggregate
principal amount of the Notes, plus accrued and unpaid interest on
the Notes to be redeemed to the Redemption Date.

Emmis Communications Corporation -- http://www.emmis.com/-- is an
Indianapolis-based diversified media firm with radio broadcasting,
television broadcasting and magazine publishing operations.  Emmis
owns 23 FM and 2 AM domestic radio stations serving the nation's
largest markets of New York, Los Angeles and Chicago as well as
Phoenix, St. Louis, Austin, Indianapolis and Terre Haute, Indiana.
Emmis has recently announced its intent to seek strategic
alternatives for its 16 television stations, which will result in
the sale of all or a portion of its television assets.  In
addition, Emmis owns a radio network, international radio
stations, regional and specialty magazines and ancillary
businesses in broadcast sales and book publishing.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 5, 2005,
Moody's Investors Service affirmed the long-term ratings of Emmis
Communications Corporation and its wholly owned subsidiary, Emmis
Operating Company, and changed the outlook to positive.

Emmis Operating Company:

   * Ba2 rating on its senior secured credit facilities; and

   * B2 rating on its $375 million of senior subordinated notes
     due 2012.

Emmis Communications Corporation:

   * B3 rating on the $350 million senior unsecured floating rate
     notes due 2012,

   * B3 rating on the 12.5% senior discount notes due 2011;

   * Caa1 rating on the $143.8 million of cumulative convertible
     preferred stock;

   * Ba3 corporate family rating; and

   * SGL-3 rating.


EQUINOX HOLDINGS: Moody's Rates $290 Mil. Sr. Debt Offering at B3
-----------------------------------------------------------------
Moody's Investors Service assigned ratings to Equinox Holdings,
Inc., in connection with its acquisition by The Related Companies,
L.P.  Related is a New York limited partnership engaged in the
business of developing, managing and financing domestic and
international real estate.  Moody's assigned a B3 rating to the
$290 million senior note offering, a B3 corporate family rating
and a stable outlook.

Proceeds from the $290 million of senior notes due 2012, $115
million of discount notes of Equinox's parent and a $115 million
cash equity contribution were used to fund a tender offer for the
company's $160 million of outstanding 9% senior notes due 2009,
purchase outstanding equity securities and pay related fees and
expenses.

Moody's downgraded the rating on Equinox's senior notes due 2009
to Caa1 from B3, concluding the review for downgrade initiated on
Dec. 20, 2005.  Equinox announced on Feb. 10, 2006 that in
response to its cash tender offer and consent solicitation, it had
received and accepted for purchase valid tenders and consents from
holders of approximately 98.9% of the outstanding $160 million
senior notes due 2009.  The Caa1 rating on the remaining senior
notes due 2009 reflects the lack of ongoing protection for note
holders, given that the notes were stripped of all credit support
and covenant protection.  Moody's has withdrawn all the other
credit ratings of Equinox Holdings, Inc., and will withdraw the
rating on the senior notes due 2009 in the very near term, given
that over 98% of the notes have been tendered.

The ratings assigned to Equinox reflect high levels of debt pro
forma for the acquisition, near-term expectations of negative free
cash flow from operations due to a planned aggressive growth
strategy and the relatively small size and geographically
concentrated nature of company's fitness club base.  The ratings
also consider improving financial performance, the expected
maturation of the club base and growth opportunities in the
fitness industry.

Moody's assigned these ratings to Equinox Holdings, Inc.:

   * $290 million senior unsecured notes (guaranteed) due 2012,
     rated B3

   * Corporate family rating, rated B3

The ratings outlook is stable

Equinox has rapidly expanded its club base over the last few years
and now operates 32 upscale clubs, with 19 clubs in the New York
metropolitan region.  The New York clubs are expected to account
for about 80% of revenues and over 90% of operating profit in
2005.  Equinox began expanding outside of the New York region in
2001 and now has 7 clubs in Southern California, 1 club in
Northern California, 4 clubs in Chicago and 1 club in South
Florida.  Since these clubs are in the first few years of
operation, in aggregate they are not currently making a meaningful
contribution to profitability given the degree of their
maturation.  The ratings reflect significant exposure to economic
and competitive conditions in the New York area as well as a
dependence on just 13 mature New York clubs for most of company's
profitability and cash flow.  Moody's expects the company's
revenue and operating profit to become more diversified
geographically as recently opened clubs outside of New York
mature.

Equinox fitness clubs target an upscale demographic segment and
offer a wide variety of ancillary programs including personal
training, group fitness classes, spas and retail shops. Revenue
from ancillary programs has grown rapidly in the last few years
and account for about 34% of total revenue.  These ancillary
services tend to generate high operating margins and have a
positive impact on member retention rates.  The company's upscale
focus and success in selling ancillary services is evident in the
relatively high average annual revenue per member and EBITDA
margins.

Equinox should continue to benefit from its favorable brand
recognition, positive long term industry trends and strong track
record of growth.  Fitness industry revenues and memberships have
grown consistently during the last decade driven in part by the
aging of the baby boomers and the growing awareness of the health
implications of obesity.  However, competition in the industry has
increased rapidly as well reflecting low barriers to entry.  A
weakening economy or increased competition for Equinox's upscale
target market could make it harder for the company to attract new
members and result in increasing member attrition rates.

The financial performance of the company's rapidly expanding club
base has been solid over the last few years.  Revenues grew from
$116 million in 2003 to about $168 million in LTM period.  The
growth in revenues was primarily because of an increase in the
member base, primarily due to fitness club openings, growth in
personal training services and member price increases.  Operating
income increased from $18 million in 2003 to $24 million in the
LTM period.  Operating margin, however, decreased from about 15.6%
in 2004 to about 14.4 % in the LTM period primarily reflecting an
increase in general and administrative expenses as a percentage of
revenues.

Despite the growth in revenues, cash flow from operations has
increased only marginally from $26 million in 2003 to $30 million
in the LTM period.  Cash flows have been constrained by the
generally weak profitability levels of fitness clubs during the
first two years of operation.  Only 13 of Equinox's 32 clubs have
been opened for more than 4 years with an aggregate of 13 clubs
opened since 2004.

Free cash flows have been consistently negative over the last few
years due to the high level of capital expenditures needed to
support the company's growth plans.  Capital expenditures were $33
million in 2003, $37 million in 2004 and $51 million in the LTM
period.  Equinox opened 4 clubs in 2003, 5 clubs in 2004, and 7
clubs in 2005.  Growth capital expenditures have averaged about
$5-$6 million per new club over the last 3 years.

Moody's expects Equinox to continue to open new clubs at a pace of
about 6 a year for the next few years.  Risks related to this
aggressive growth strategy include higher than expected levels of
required capital expenditures, lower profitability levels for
newer clubs and greater than expected demands on management
resources.  Equinox has a limited track record outside the New
York region and brand recognition may take longer to develop in
new markets.  However, Equinox should derive certain benefits from
its relationship with Related such as greater access to new club
locations, cross marketing opportunities and additional real
estate expertise.

The stable ratings outlook anticipates negative free cash flows in
2006 due to increased interest expense in the pro forma debt
structure, high levels of capital expenditures and first year
operating losses related to new club openings.  Moody's doesn't
expect free cash flow to approach breakeven levels until 2007 due
to the continued maturation of the club base; however, Equinox
should have adequate liquidity due to its $50 million revolver.
Although borrowing base availability under the revolver is only
about $15 million at closing after taking into account $4 million
of letters of credit, Equinox expects availability to increase to
about $45 million within the next few weeks upon completion of
certain conditions.  Equinox may need to rely significantly on the
revolver over the next two years if recently opened clubs mature
at a slower pace than expected.

Although free cash flow from operations is expected to be negative
in 2006, Moody's expects cash flow from operations less
maintenance capital expenditures to total debt to be in the 3%-5%
range.  Moody's expects leverage, as measured by debt to EBITDA,
to remain high at over 9 times during 2006.

Given the high levels of leverage upon the closing of the
transaction, an upgrade in the ratings or outlook in the near term
is unlikely.  Over the intermediate and longer term, the ratings
could be upgraded if the company successfully executes its
expansion strategy and improves profitability levels such that
sustainable free cash flow from operations to debt exceeds 5% and
adjusted debt to EBITDA falls below 6.5 times.

The ratings could be pressured if expected improvements in
profitability levels fail to materialize or capital expenditures
requirements are higher than expected which results in heavier
than expected reliance on the revolver and impairs liquidity.  A
failure to increase revolver availability to about $45 million in
the near term could also pressure the rating or outlook.

The B3 rating assigned to the senior notes, rated at the corporate
family rating level, reflects the preponderance of senior
unsecured notes in the capital structure.  The notes will benefit
from a guarantee on a senior basis by all the subsidiaries of
Equinox.  The notes and guarantees will be effectively
subordinated to all secured obligations of Equinox and secured
obligations of the subsidiary guarantors to the extent of the
value of the assets securing such obligations.

Headquartered in New York, Equinox operates full-service fitness
clubs that offer an integrated selection of Equinox-branded
programs, services and products.  Revenue for the twelve month
period ending Sept. 30, 2005 was $168 million.


EQUINOX HOLDINGS: S&P Rates Proposed $290 Million Sr. Notes at B-
-----------------------------------------------------------------
Standard & Poor's Rating Services assigned its 'B-' rating to
Equinox Holdings Inc.'s proposed $290 million senior unsecured
notes due 2012.  Proceeds from the offering, in conjunction
with $115 million of pay-in-kind notes to be issued at Related
Equinox Holdings Corp. and $125 million of new private equity,
will be used to finance The Related Companies LP's acquisition of
Equinox from North Castle Partners LLC and J.W. Childs Associates
LP.
     
At the same time, Standard & Poor's lowered its corporate credit
rating on the fitness club operator to 'B-' from 'B'.  The
downgrade is due to increased financial risk from the pending
debt-financed acquisition.  In addition, the rating was removed
from CreditWatch with negative implications.  The outlook is
stable.  Pro forma for the transaction, New York, New York-based
Equinox had total debt outstanding of about $294 million on Sept.
30, 2005.  

For analytical purposes, Standard & Poor's includes the $115
million PIK notes to be issued at Related Equinox, for total
consolidated debt of about $410 million.


ERHC ENERGY: Posts $1.2 Mil. Net Loss in Quarter Ended December 31
------------------------------------------------------------------
ERHC Energy Inc. delivered its financial results for the quarter
ended Dec. 31, 2005, to the Securities and Exchange Commission on
Feb. 9, 2006.

ERHC incurred a $1,228,984 net loss for the three months ended
Dec. 31, 2005, compared to a $7,091,068 net loss for the three
months ended Dec. 31, 2004.  A significant portion of the decrease
in net loss for the three months ended Dec. 31, 2005 was
attributable to a $5,749,575 non-cash loss on extinguishment of
debt during the three months ended Dec. 31, 2004.

During the quarters ended Dec. 31, 2005 and 2004, the Company had
no revenues from which cash flows could be generated to support
operations and relied on borrowings funded from its line of credit
with Chrome Energy as well as the sale of common stock.

At Dec. 31, 2005, ERHC's current liabilities exceed its current
assets by $2,482,419.  The Company's balance sheet showed
$6,060,052 in total assets and $2,845,119 of liabilities at Dec.
31, 2005.

                   Going Concern Doubt

Malone & Bailey, PC, expressed substantial doubt about ERHC Energy
Inc.'s ability to continue as a going concern after it audited the
Company's financial statements for the fiscal year ended Sept. 30,
2005.  The auditing firm pointed to the Company's recurring losses
from operations since inception and dependence on outside sources
of financing for the continuation of its operations.

                       About ERHC

ERHC Energy -- http://www.erhc.com/-- is an independent oil and  
gas company.  The Company was formed in 1986, as a Colorado
corporation, and was engaged in a variety of businesses until
1996, when it began its current operations as an independent oil
and gas company.


EXIDE TECH: Posts $27.6MM Net Loss in Quarter Ended December 31
---------------------------------------------------------------
New Jersey-based Exide Technologies incurred a $27,658,000 net
loss for the third quarter of fiscal 2006, ended Dec. 31, 2005,
versus a $439,040,000 net loss in the third quarter of fiscal
2005.  

The Company generated $733,442,000 of net sales in the third
quarter of fiscal 2006, versus $727,902,000 in the third quarter
of fiscal 2005.  Currency negatively impacted net sales in the
third quarter of fiscal 2006 by approximately $35,877,000.

Exide's results continued to be impacted in the third quarter of
fiscal 2006 by increases in the price of lead and other commodity
costs that are primary components in the manufacture of batteries
and energy costs used in the manufacturing and distribution of the
Company's products.

In the North American market, the Company obtains the vast
majority of its lead requirements from six Company-owned and
operated secondary lead recycling plants. These facilities reclaim
lead by recycling spent lead-acid batteries, which are obtained
for recycling from the Company's customers and outside spent-
battery collectors.  Similar to the rise in lead prices, however,
the cost of spent batteries has also increased.  For the third
quarter of fiscal 2006, the average cost of spent batteries has
increased approximately 45% versus the third quarter of fiscal
2005.

In Europe, the Company's lead requirements are mainly obtained
from third-party suppliers.  Because of the Company's exposure to
lead market prices in Europe and based on historical price
increases and apparent volatility in lead prices, the Company has
implemented several measures to offset higher lead prices
including selective pricing actions, lead price escalators, lead
hedging and entering into long-term lead supply contracts.

In addition to managing of the impact of higher lead and other
commodity costs on the Company's results, the key elements of the
Company's underlying business plans and continued strategies for
fiscal 2006 include:

     a) the successful execution and completion of the Company's
        ongoing restructuring plans, and organizational
        realignment of divisional and corporate functions
        resulting in further headcount reductions, principally in
        selling, general and administrative functions globally;  

     b) actions to improve the Company's liquidity and operating
        cash flow through aggressive working capital reduction
        plans, the sales of non-strategic assets and businesses,
        streamlining cash management processes, implementing plans
        to minimize the cash costs of the Company's restructuring
        initiatives and closely managing capital expenditures; and

     c) continuing measures to reduce costs, improve customer
        service and satisfaction through enhanced quality and
        reduced lead times.

At Dec. 31, 2005, the Company's balance sheet showed $2.1 billion
in total assets and $1.8 billion in total liabilities.  As of Dec.
31, 2005, the Company had cash and cash equivalents of $36,872 and
availability under the Revolving Loan Facility of $12,147 as
compared to cash and cash equivalents of $76,696 and availability
under the Revolving Loan Facility of $68,814 at March 31, 2005.  
On Feb. 3, 2006, total liquidity was approximately $71,200,
consisting of availability under the revolving term loan facility
of $27,500 and an estimated $43,700 in cash and cash equivalents.  

                 About Exide Technologies

Headquartered in Princeton, New Jersey, Exide Technologies --
http://www.exide.com/-- is the worldwide leading manufacturer and      
distributor of lead acid batteries and other related electrical
energy storage products.  The Company filed for chapter 11
protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125).
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, represented the Debtors in their successful restructuring.  
Exide's confirmed chapter 11 Plan took effect on May 5, 2004.  On
April 14, 2002, the Debtors listed $2,073,238,000 in assets and
$2,524,448,000 in debts. (Exide Bankruptcy News, Issue No. 80;
Bankruptcy Creditors' Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 6, 2006,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Exide Technologies to 'CCC' from 'CCC+' because of
Exide's continued poor operating performance and rising debt
leverage.

The senior secured rating on Exide's recently enlarged first-lien
credit facility was lowered to 'CCC' from 'B-', and the recovery
rating was lowered to '2' from '1', because of the lower corporate
credit rating and the weaker asset protection for the enlarged
facility.  The senior secured rating and the recovery rating
reflect Standard & Poor's expectation that lenders will realize a
substantial recovery of principal (80%-100%) in the event of
default or bankruptcy.
     
The senior secured rating on Exide's second-lien notes was lowered
to 'CC' from 'CCC', reflecting the lower corporate credit rating
and an increase in priority debt.


EXTENSITY SARL: S&P Rates Proposed $410 Million Facilities at B
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Atlanta, Georgia-based Extensity S.a.r.l.  At the
same time, Standard & Poor's also assigned its 'B' senior secured
debt rating to the company's proposed $410 million in first lien
credit facilities; the recovery rating is '3', indicating a
meaningful (50%-80%) recovery of principal in the event of a
payment default or bankruptcy.  The facilities consist of:

   * a $50 million revolving credit; and
   * a $360 million first priority term loan.

The outlook is positive.
     
Proceeds of the facilities, together with $165 million in second
priority debt, an equity contribution, and a partial sale of
certain subsidiaries to Infor Global Solutions, AG, another Golden
Gate portfolio company, will be used to fund the company's
acquisition of GEAC Corp.
      
"The ratings reflect Extensity's narrow business profile, high
leverage and aggressive cost cutting objectives, partly offset by
stable and recurring revenues from the company's legacy financial
applications," said Standard & Poor's credit analyst Lucy
Patricola.
     
Extensity is a provider of software and services that focus on
primarily financial applications, such as accounting, payroll and
expense management.  The company also offers solutions for
strategic financial management and budgeting.  Supplementing its
core financial applications, Extensity provides a number of
industry-specific vertical applications.  The two segments
generate about $325 million in revenues.
     
Extensity operates in a competitive and fragmented segment of
enterprise software, and further narrows its focus to a mid market
client base.  Its legacy solutions are characterized by
transaction intensive applications run largely in a mainframe
environment.  While growth potential is limited, contract
retention is high and revenue is largely recurring.  There is no
customer concentration, limiting contract termination risk.
Extensity is striving to deepen its penetration into its installed
base with applications that extend past transaction processing
into financial management and budgeting with its business
analytics solutions.


FEDDERS CORP: Receives Non-Compliance Notice from NYSE
------------------------------------------------------
Fedders Corporation (NYSE: FJC) has been notified by the New York
Stock Exchange that it is currently not in compliance with the
NYSE's continued listing standards.  The company is considered
"below criteria" by the NYSE since, over a 30 trading-day period,
its average global market capitalization was less than
$75 million, as of Jan. 30, 2006 and its stockholders' equity was
less than $75 million as of its Sept. 30, 2005 Form 10-Q.

In accordance with the NYSE's rules, the company intends to submit
a business plan to the NYSE within 45 days that will demonstrate
compliance with the continued listing standards within 18 months.  
The company believes that, as a result of the previously reported
identified cost savings in excess of $20 million, in part related
to consolidations in its operating units, and its focus on growth
and profitable business, the business plan it submits to the NYSE
will demonstrate compliance with the listing standards within the
required timeframe.

Following receipt of the plan, the NYSE will make a determination
to either accept the business plan, at which time the company will
be subject to quarterly monitoring for compliance with the
business plan, or it will not accept the business plan, at which
time it will be subject to suspension by the NYSE and delisting by
the SEC.
    
Beginning on Feb. 13, 2006, the NYSE will make available on its
consolidated tape an indicator, ".BC," to reflect that the company
is below the NYSE's quantitative listing standards.  The indicator
will be removed at such time as the company is deemed compliant
with the NYSE's continued listing standards.

Headquartered in Liberty Corner, New Jersey, Fedders Corporation,
-- http://www.fedders.com/-- is a leading global manufacturer and  
marketer of air treatment products, including air conditioners,
air cleaners, dehumidifiers, and humidifiers.  The company has
production facilities in the United States in Illinois, North
Carolina, New Mexico, and Texas and international production
facilities in China, India and the Philippines.  All products are
manufactured to Fedders' one worldwide standard of quality.

                          *     *     *

                     Default on Senior Debts

On June 24, 2005, the Company defaulted on the covenant in Senior  
Notes Indenture requiring the Company to file a Form 10-K for the  
year ended Dec. 31, 2004.  This delay in filing the Form 10-K  
also resulted in a default under our agreement with Wachovia Bank,  
NA.  

On Sept. 13, 2005, the Company received the written consent  
from holders of a majority in aggregate principal amount of the  
outstanding Senior Notes under the Indenture waiving the default  
in performance of this covenant and consenting to the adoption of  
the First Supplemental Indenture and Waiver, dated Sept. 13, 2005.  

By the terms of the waiver, the Company must file its Form 10-K on  
or before Sept. 30, 2005 and Forms 10-Q for the first and  
second quarters of 2005 on or before Nov. 30, 2005.  The  
Company currently expects to file these reports by such date.

In order to obtain the consent of the holders of the Senior Notes,
pursuant to the First Supplemental Indenture, the Company and FNA
agreed that during the Waiver Period an additional 100 basis
points of interest will accrue on the principal amount of the
Senior Notes, which amount shall be payable with the interest
payment due on March 1, 2006.


FFCA SECURED: Fitch Downgrades Seven Loan Classes' Ratings to Cs
----------------------------------------------------------------
Fitch took rating actions on the outstanding classes of these FFCA
Secured Franchise Loan Trust issues:

  Series 1999-2:

    -- Class A-1b affirmed at 'BBB'
    -- Class A-1c affirmed at 'AAA'*
    -- Class A-2 downgraded to 'BB' from 'A'
    -- Class B-1 downgraded to 'CC' from 'B-'
    -- Class B-2 downgraded to 'CC' from 'B-'
    -- Class C-1 downgraded to 'C' from 'CCC'
    -- Class C-2 downgraded to 'C' from 'CCC'
    -- Class D-1 downgraded to 'C' from 'CC'
    -- Class D-2 downgraded to 'C' from 'CC'
    -- Classes E-1 and E-2 remain at 'C'

  Series 2000-1:

    -- Class A-2 affirmed at 'AAA'*
    -- Class B affirmed at 'B'
    -- Class C remains at 'CCC'
    -- Class D downgraded to 'C' from 'CC'
    -- Class E remains at 'C'

*Rating based on an MBIA guarantee.

The negative rating actions reflect additional reductions in the
credit enhancement (CE) Fitch expects will be available to support
each class in these transactions.  As many loans in default have
remained unresolved, recovery expectations have decreased, while
interest liabilities continually detract from collections.  These
lowered expectations in conjunction with incurred losses on
existing defaults have reduced subordination and CE available to
outstanding bonds.

Anticipated CE is based on Fitch's expected recoveries on
defaulted collateral.  Fitch's recovery expectations are based on
historical collateral-specific recoveries experienced in the
franchise Asset-Backed Securities sector.


FIRST FRANKLIN: Fitch Affirms Class B Certificates' BB+ Rating
--------------------------------------------------------------
Fitch Ratings affirmed these First Franklin Financial Corporation
residential mortgage-backed certificates:

  Series 2000-FF1:

    -- Class A 'AAA'
    -- Class M-1 'AA'

  Series 2001-FF1:

    -- Class A-1 'AAA'
    -- Class M-1 'AA'

  Series 2001-FF2:

    -- Classes A-1 and A-2 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Class M-3 'BBB'

  Series 2002-FF1:

    -- Classes I-A-2 and II-A-1 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Class M-3 'BBB'

  Series 2002-FF2:

    -- Classes A-1 and A-2 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Class M-3 'BBB+'

  Series 2003-FF2:

    -- Class A-1 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Classes M-3-A and M-3-F 'A-'
    -- Classes M-4-A and M-4-F 'BBB+'
    -- Classes M-5-A and M-5-F 'BBB'

  Series 2003-FF3:

    -- Classes I-A and II-A-2 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Class M-3 'A-'
    -- Class M-4 'BBB+'
    -- Class B 'BBB'

  Series 2003-FF5:

    -- Classes A-1 through A-3 'AAA'
    -- Class M-1 'AA'
    -- Class M-2 'A'
    -- Class M-3 'A-'
    -- Class M-4 'BBB+'
    -- Class M-5 'BBB'
    -- Class M-6 'BBB-'
    -- Class B 'BB+'

The affirmations, affecting approximately $730 million of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss.  The losses suffered by the
affirmed transactions are in line with expectations, ranging from
0.13% (2003-FF3) to 1.16% (2000-FF1) of the original collateral
balance.  In general, the overcollateralization has remained near
or at its target over the last year for all affirmed transactions.

The collateral of the above transactions consists of subprime,
fixed-rate mortgage loans and adjustable-rate mortgage loans.
Series 2001-FF2 and the 2002 through 2003 vintage certificates are
supported by two collateral groups.  The first consists of loans
with principal balances that conform to Fannie Mae and Freddie Mac
guidelines, while the second is made up of loans with principal
balances that may or may not conform to Fannie Mae and Freddie Mac
guidelines.  

All of the above transactions are serviced by either:

   * Option One Mortgage Corp. (rated 'RPS1' by Fitch);
   * Saxon Mortgage Inc. ( 'RPS2+');
   * Chase Home Finance LLC ('RPS1'); or
   * Ocwen Loan Servicing LLC ('RPS2').

The pool factors for the affirmed deals range from 4% (2001-FF1)
to 34% (2003-FF5).  The seasoning for the affirmed deals ranges
from 24 months (2003-FF5) to 62 months (2000-FF1).


GENCORP INC: Posts $175 Mil. Net Loss in Fourth Qtr. Ended Nov. 30
------------------------------------------------------------------
GenCorp Inc. (NYSE: GY) reported results for the fourth quarter
and the fiscal year ended Nov. 30, 2005.

             2005 Fourth Quarter Highlights and Events

   * The Company wrote down Atlas(R) V inventory of $169 million
     and completed sale of its Aerojet Fine Chemicals business for
     $114 million.

   * Fourth quarter 2005 sales from continuing operations
     increased 38% compared to fourth quarter 2004.  Year-over-
     year annual sales increased 25%.

   * The Company is exploring entering into a transaction on its
     2,700 acre Rio Del Oro project.

   * The Company continued discussions with the City of Folsom
     regarding the annexation and entitlement of 625 acres,
     bringing the total amount of Company-owned land currently in
     the entitlement and rezoning process to approximately
     10 square miles.

Sales from continuing operations for the fourth quarter 2005
totaled $205 million, 38% above $149 million in the fourth quarter
2004.  Sales for 2005 were $624 million compared to $499 million
for 2004, an increase of 25%.

Excluding Atlas sales of $84 million in 2005 and $13 million in
2004, year-over-year growth was 11%.   Sales in 2005 reflect
growth in the Company's Aerospace and Defense business.

The Company's net loss from continuing operations was $175 million
for the fourth quarter 2005 and $206 million for the full year.  
The losses included a $169 million write-down of inventory on the
Atlas V program and a $29 million charge for Olin litigation.  
Also included for the full year is a net charge for resolution of
additional legacy litigation matters, recapitalization costs,
other settlements, and a $29 million tax benefit for the carryback
of current and prior year losses resulting in refunds of
previously paid taxes.

The Company's net loss from continuing operations was $14 million
for the fourth quarter 2004 and $86 million for 2004.  The loss
for the full year included a net charge of $9 million related
to the recapitalization costs and a $29 million tax provision.

"In the fourth quarter and throughout the year, GenCorp steered
its way through a number of legacy liability issues which predate
our 1999 spin-off of the polymer products segment -- now OMNOVA
Solutions, Inc.," Terry Hall, chairman, president and chief
executive officer said.  "We achieved acceptable settlements of
retiree medical claims in the Wotus litigation and in our toxic
tort cases in Southern California.  While we were disappointed
with having to write-down the Atlas V inventory and recognize the
$29 million charge for the Olin litigation, these necessary
actions, combined with the sale of our Fine Chemicals business,
allow us to put many legacy uncertainties behind us with results
going forward more reflective of our two core businesses."

"Aerojet's revenue growth this year is a confirmation of our
strategy to participate in the consolidation of the U.S.
propulsion market and to grow Aerojet to assure effective funding
of our environmental remediation programs.  As a result of our
discussions with the City of Folsom regarding annexation of
625 acres, we now have approximately 10 square miles of land in
the rezoning and entitlement process in Northern California, and
look forward to the approval of our first project, Rio Del Oro,
later this year," continued Mr. Hall.

                        Operations Review

1.  Aerospace and Defense Segment

Fourth quarter sales from continuing operations increased 47% to
$203 million compared to $138 million in the fourth quarter 2004,
including Atlas sales of $68 million in the fourth quarter 2005
and $12 million in the fourth quarter 2004.  Excluding Atlas,
fourth quarter sales increased 7% to $135 million compared to
$126 million in the fourth quarter 2004.

Sales for 2005 increased 25% to $617 million compared to
$492 million last year.  Included in these amounts were Atlas
sales of $84 million in 2005 and $13 million in 2004. Excluding
Atlas, 2005 sales increased 11% to $533 million compared to
$479 million last year.  Most of Aerojet's product areas
contributed to the growth, with individual program increases of
greater than $10 million related to Standard Missile, Terminal
High-Altitude Area Defense and Tomahawk.

Fourth quarter 2005 segment performance was a loss of $150 million
compared to income of $7 million in the fourth quarter 2004.  
Excluding the impact of employee retirement benefit plan expense
and unusual items, segment performance for the fourth quarter 2005
was a loss of $154 million, compared to income of $13 million in
the fourth quarter of 2004.  Segment performance, which is a non-
GAAP financial measure, is defined in the Operating Segment
Information table included in this release.

Segment performance for the full year 2005 was a loss of
$137 million compared to income of $30 million in 2004.  Excluding
the impact of employee retirement benefit plan expense and unusual
items, 2005 segment performance was a loss of $113 million
compared to income of $57 million in 2004.

Significant factors impacting the change in segment performance
compared to the prior year were:

   (a) $169 million and $16 million write-down of inventory
       associated with the Atlas V program in 2005 and 2004,
       respectively;

   (b) environmental reserve and recovery adjustments that
       resulted in $4 million expense in 2005 compared to a
       $16 million favorable impact to segment performance in
       2004; and

   (c) changes in product mix that resulted in lower margins
       during 2005.

With the recent completion of deliveries on the Titan program and
restructure of the Atlas V contract, sales for these two programs
in 2006 are expected to decline by approximately $70 million from
2005 sales.  Titan sales are expected to rebound in 2007 and 2008
when final facilities conversion and other related close-out
activities are funded by the U.S. Air Force.

Aerojet, which Boeing Integrated Defense Systems selected as
"Supplier of the Year," had a number of fourth quarter successes:

   -- awarded a $20 million contract to develop and demonstrate a
      new ICBM motor for the Air Force Applications Advanced
      Second Stage Booster Development program;

   -- demonstrated its rocket motor for the THAAD missile flight
      test;

   -- negotiated a production contract for the Guided Multiple-
      Launch Rocket System; and

   -- expanded its propulsion support of the TOW program with a
      new Bunker Buster contract.

"Aerojet's engines performed flawlessly on seven launches during
2005 with 100% mission success, including the final Titan IV
flight in October, marking the last milestone for Aerojet's 50
years of Titan program work," Mr. Hall commented.  "Aerojet's
launch and in-space technology also supported several other high
profile deep space missions during the year, including the Mars
Reconnaissance Orbiter and the Stardust project.  In January 2006,
five of Aerojet's solid rocket boosters launched the New Horizons
spacecraft on its journey to Pluto."

"Aerojet's accomplishments over the last year and the breadth of
our technology and products position us to benefit from multiple
new opportunities emerging from the Department of Defense and
NASA," continued Mr. Hall.

As of Nov. 30, 2005, contract backlog was $696 million compared to
$879 million as of Nov. 30, 2004.  The decrease in the contract
backlog is primarily a result of the renegotiated Atlas V
contract.  Excluding Atlas, other program contract backlog grew by
$69 million, a 13% increase.  Funded backlog, which includes only
the amount for which money has been directly authorized by the
U.S. Congress, or for which a purchase order has been received
from a commercial customer, was $498 million as of Nov. 30, 2005,
compared to $538 million on Nov. 30, 2004.  Excluding Atlas,
funded backlog grew by $27 million, a 7% increase.

2.  Real Estate Segment

Real Estate sales and segment performance for 2005 were $7 million
and $4 million, respectively, compared to $15 million and $12
million, respectively, for 2004.  The 2004 results included
revenue from a property usage agreement and an exclusive mining
rights agreement.  Results for 2005 consist of rental property
revenue only, as there were no significant sales of real estate
assets.

In 2005, the Company continued its efforts to enhance shareholder
value by repositioning excess Sacramento land holdings for higher
and better uses.  The City of Rancho Cordova is the planning and
entitlement authority for the Company's 2,716-acre Rio Del Oro
project application.  The City, which is awaiting comments from
the U.S. Army Corps of Engineers, expects to release its
Environmental Impact Review in March 2006, with approval of the
application anticipated in late 2006.

Rancho Cordova also has jurisdiction over the Company's 1,654-acre
Westborough project.  The City expects to start the EIR for this
project in the next few months, with project approval anticipated
in 2008.

The County of Sacramento is the planning and entitlement authority
for the 1,385-acre Glenborough and Easton place project.  The
County began preparation of the EIR for this project in June 2005.  
A draft EIR generally takes at least a year to prepare; therefore,
the Company expects this document to be released for comments in
the second half of 2006, with project approval anticipated in
2007.

The Company, along with several other property owners, is engaged
in discussions with the City of Folsom regarding the annexation,
rezoning and entitlement of 3,500 acres of County land, 625 of
which are owned by the Company, in Folsom's sphere of influence.  
With this additional acreage, 6,400 acres, or approximately 10
square miles, of the Company's Sacramento land is in process for
re-zoning and entitlement.

"The key to creating shareholder value with our real estate
holdings is obtaining the rezoning and entitlement approvals
required to return this land to higher and better uses," Mr. Hall
noted.  "In California, this is a complex and lengthy process, the
timing of which is difficult to predict.  The Rio Del Oro
application is currently dependent upon the response from the
Corps of Engineers.  We continue to work closely with the City of
Rancho Cordova in its efforts to keep this project on track for
approval in late 2006.

"We will continue to explore real estate structures or
transactions which add to shareholder value, such as our recent
announcement regarding the exploration of a possible real estate
transaction on our Rio Del Oro project," concluded Mr. Hall.

Additional Information

The loss from discontinued operations was $24 million in 2005
compared to $312 million in 2004.  The loss in 2005 included a
$29 million charge associated with the disposition of the Fine
Chemicals business, primarily reflecting the seller note of
$26 million for which income will be recorded as the note is
realized.  The loss in 2004 included a one-time charge of
$279 million associated with the disposition of the GDX Automotive
business.

The Company recorded an inventory write-down of $169 million in
the fourth quarter of 2005 on a contract to design, develop and
produce a solid rocket motor for Lockheed Martin's Atlas V
program.  Recovery of the Atlas V inventory has been subject to
several uncertainties.

Until recently, the Company believed that a contract
restructuring, projected to occur in late 2005, would permit
recovery of inventoried development and production costs.  This
belief was based on prior statements by government officials
regarding funding for the Evolved Expendable Launch Vehicle
program, and ongoing discussions with the prime contractor over a
long period of time, including requests for historical costs and
past investment.  

Recently, the Company learned that government funding is not
available to recover past costs, and as a result, the Company
concluded renegotiation of the contract was in its best interest
to prevent further unrecoverable investment in this historically
unprofitable program.  Accordingly, on Dec. 22, 2005, the Company
reached an agreement with Lockheed Martin Corporation, which
spells out the renegotiated terms.

On Nov. 30, 2005, the Company sold its Fine Chemicals business to
American Pacific Corporation for $114 million, subject to
adjustment, consisting of $88 million of cash, unsecured
subordinated seller note of $26 million.  Additionally, AMPAC will
pay us up to $5 million based on the Fine Chemical business
achieving specified earning targets in the twelve month
period ending Sept. 30, 2006.

Interest expense decreased to $24 million in 2005 from $35 million
in 2004.  The decrease is the result of lower average debt and
interest rates as a result of the sale of the GDX Automotive
business in August 2004 and the recapitalization transactions
initiated in November 2004 and completed in February 2005.

Total debt decreased to $444 million at Nov. 30, 2005, from
$577 million at Nov. 30, 2004.  The cash balance at Nov. 30, 2005,
was $91 million, all of which was unrestricted, whereas the cash
balance at Nov. 30, 2004, totaled $269 million, of which
$201 million was restricted.  The restricted cash was used in the
first quarter of 2005 to pay down debt.  Total debt less cash
increased from $308 million at Nov. 30, 2004, to $353 million as
of Nov. 30, 2005.  

The $45 million increase resulted primarily from:

   (a) costs associated with the recapitalization transactions
       completed in the first quarter of 2005;

   (b) payment for the Olin judgment;

   (c) costs associated with legacy business matters, including
       costs related to postretirement plans;

   (d) interest payments on debt;

   (e) corporate expenses; and

   (f) capital expenditures offset by cash received from the sale
       of the Fine Chemicals business and cash generated by the
       Aerospace and Defense segment.  

As of Nov. 30, 2005, the Company's $80 million revolving credit
facility was unused.

                         Material Weakness

The Company is required to assess the effectiveness of its
internal control over financial reporting as of the end of its
year ended Nov. 30, 2005.  In the Company's 2005 Form 10-K,
management expects to report a material weakness in internal
control over financial reporting concerning insufficient processes
and controls to communicate information in sufficient detail as it
relates to accounting for complex, non-routine transactions.  As a
result, management is expected to conclude that its internal
control over financial reporting was not effective at Nov. 30,
2005.

GenCorp Inc. -- http://www.GenCorp.com/-- is a leading
technology-based manufacturer of aerospace and defense products
and systems with a real estate business segment that includes
activities related to the development, sale and leasing of the
Company's real estate assets.

                           *     *     *

As previously reported in the Troubled Company Reporter on
Nov. 11, 2004, Moody's Investors Service assigned a Caa2 rating to
GenCorp, Inc.'s proposed $50 million convertible subordinated
notes, due 2024, and a B1 rating to the company's new $175 million
senior secured credit facilities, consisting of a $75 million
revolving credit due 2009 and a $100 million term loan due 2010.  
The proceeds from the new notes and facilities, along with about
$100 million expected from a recently-announced 7.5 million public
share offering as well as cash provided by the recent sale of the
GDX automotive division in August 2004, will be used to repurchase
part of the company's existing 5-3/4% note (due 2007) and certain
other debt securities, as well as to re-finance its existing
senior secured credit facilities.

All other ratings of the company have been affirmed:

   * Senior implied rating of B2

   * Unsecured issuer rating of B3

   * $150 million 9.5% senior subordinated notes, due 2013, of
     Caa1

   * $150 million 5.75% convertible subordinated notes, due 2007,
     of Caa2

   * $125 million 4% convertible subordinated notes, due 2024, of
     Caa2

The ratings outlook is stable.

As previously reported in the Troubled Company Reporter on
Nov. 11, 2004, Fitch Ratings revised the Rating Outlook on GenCorp
Inc. to Stable from Negative.  Fitch has also assigned a 'BB-'
rating to GY's proposed senior secured bank facility (which will
replace the existing senior secured bank facility), and a 'B-'
rating to a convertible subordinated notes offering due 2024.  
Additionally, Fitch affirms these ratings for GY:

   -- Senior subordinated notes due 2013 'B+';
   -- Convertible subordinated notes due 2007 'B-';
   -- Contingent convertible subordinated notes due 2024 'B-'.

Approximately $705 million in debt securities is affected by these
actions.

As previously reported in the Troubled Company Reporter on
Nov. 11, 2004, Standard & Poor's Ratings Services assigned its
'BB' bank loan rating and a recovery rating of '1' to GenCorp
Inc.'s proposed $175 million senior secured credit facilities,
indicating the high expectation of full recovery of principal in
the event of default.  Standard & Poor's also assigned its 'B'
rating to the firm's proposed $50 million convertible subordinated
notes due 2024 offered under Rule 144A with registration rights,
which could be increased to $75 million via a greenshoe option.

At the same time, Standard & Poor's revised its outlook on the
propulsion supplier to negative from developing. The existing
ratings, including the 'BB-' corporate credit rating, were
affirmed.


GENCORP INC: S&P Lowers Corporate Credit Rating to B+ from BB-
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on GenCorp
Inc., including lowering the corporate credit rating to 'B+' from
'BB-'.  The outlook is stable.  The aerospace propulsion provider
has about $445 million in debt.
      
"The downgrade reflects continued poor, albeit improving,
operating performance in the core Aerojet unit," said Standard &
Poor's credit analyst Christopher DeNicolo.  "Although a potential
real estate transaction could result in significant cash inflows,
the timing, amount, and use of proceeds is still uncertain," the
analyst continued.
     
The ratings on Sacramento, California-based GenCorp reflect a weak
financial profile, driven by high leverage and poor profitability,
and a modest scale compared with competitors.  These factors are
offset somewhat by solid niche positions in aerospace propulsion
and significant real estate holdings.

The company's Aerojet unit, which accounts for almost all sales,
had 25% revenue growth in fiscal 2005 stemming from growth in a
number of programs, especially related to missile defense and the
Atlas V launch vehicle.  Revenues from the Atlas V contract and
the recent completion of the Titan launch vehicle program will
decline $70 million in 2006.  However, Titan revenues will rebound
in 2007 and 2008 due to contract close out activities.

Segment operating income, excluding pension expense and one-time
items, was essentially flat (despite the sales increase) due to a
shift in the product mix toward lower margin products.  In the
fourth quarter of fiscal 2005 (ended Nov. 30, 2005) the company
took a $169 million, largely noncash charge, to write off
inventory related to the Atlas V contract.  Although book equity
is now negative as a result of the charge, higher prices on the
remaining 14 Atlas boosters in the contract should result in only
modest additional cash outflows.  Pension expense increased
significantly in 2004, reflecting the amortization of prior years'
losses, even though the company's defined-benefit pension plan is
fully funded, and will continue at high levels for the
intermediate term.
     
The renegotiation of the Atlas V contract and a generally
favorable environment for defense spending should result in
improved profitably and cash generation at Aerojet.  If operating
performance at Aerojet does not improve as expected, the outlook
could be revised to negative.  Overall, credit protection measures
will remain weak, but should strengthen modestly over the next two
years.  If a significant real estate transaction is arranged and
the company uses the proceeds to reduce debt materially, the
ratings could be placed on CreditWatch with positive implications.


GRANDVIEW HEIGHTS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Grandview Heights, L.P.
        dba Grandview Heights Apartments
        6046 Delmar
        St. Louis, Missouri 63112

Bankruptcy Case No.: 06-40511

Type of Business: The Debtor operates an apartment building
                  located in St. Louis, Missouri.  Grandview
                  Heights previously filed for chapter 11
                  protection on Nov. 2, 2005 (Bankr. E.D. Mo.
                  Case No. 05-61837).

Chapter 11 Petition Date: February 10, 2006

Court: Eastern District of Missouri (St. Louis)

Judge: Barry S. Schermer

Debtor's Counsel: Elbert A. Walton, Jr., Esq.
                  Metro Law Firm, LLC
                  2320 Chambers Road
                  St. Louis, Missouri 63136
                  Tel: (314) 388-3400
                  Fax: (314) 388-1325

Total Assets: $3,589,749

Total Debts:  $2,965,402

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Office Depot                  Office supplies             $6,000
600 Kellwood Parkway
Chesterfield, MO 63017

J. Young                      Security deposit              $500
3509 Bailey
St. Louis, MO 63107

L. Nelson                     Security deposit              $500
3022 Kossuth
St. Louis, MO 63107

E. Merriman                   Security deposit              $500

N. Penn                       Security deposit              $456

D. Caldwell                   Security deposit              $450

K. Lee                        Security deposit              $450

V. Thomas                     Security deposit              $450

P. Lucas                      Security deposit              $436

S. Johnson                    Security deposit              $427

R. Nance                      Security deposit              $407

B. Kemp                       Security deposit              $395

C. Dyer                       Security deposit              $366

L. Mason                      Security deposit              $366

A. Denson                     Security deposit              $333

S. Harris                     Security deposit              $322

B. Lewis                      Security deposit              $294

L. Ford                       Security deposit              $285

W. Joiners                    Security deposit              $263

A. Green                      Security deposit              $250


GREAT NORTHERN: Ch. 7 Trustee Taps Silverman as Mass. Counsel
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine gave Gary M.
Growe, the chapter 7 Trustee overseeing the liquidation of Great
Northern Paper, Inc., permission to employ Silverman & Kudisch
P.C., as his local counsel in the Commonwealth of Massachusetts.

Silverman & Kudisch will assist the Trustee in the administration
of the Debtor's chapter 7 estate in matters involving the state of
Massachusetts and on issues related to the collection of monies
due to the estate.

Richard L. Blumenthal, Esq., a member at Silverman & Kudisch, is
one of the lead attorneys from the Firm performing services to the
Trustee.  Mr. Blumenthal charges $300 per hour for his services.

Mr. Blumenthal reports Silverman & Kudisch's professionals bill:

    Professional         Hourly Rate
    ------------         -----------
    Sumner Darman           $495
    Peter L. Zimmerman      $325
    Lisa B. Darman          $275

    Designation          Hourly Rate
    -----------          -----------
    Paralegals              $100

Silverman & Kudisch assures the Court that it does not represent
any interest materially adverse to the Debtor or its estate.

Headquartered in Millinocket, Maine, Great Northern Paper, Inc.,
one of the largest producers of groundwood specialty papers in
North America, filed for chapter 11 protection on January 9, 2003
(Bankr. Maine Case No. 03-10048).  Alex M. Rodolakis, Esq., and
Harold B. Murphy, Esq., at Hanify & King, P.C., represent the
Debtor.  When the Company filed for chapter 11 protection, it
listed debts and assets of more than $100 million each.  In early
2003, Belgravia purchased substantially all of the Debtor's assets
for approximately $75 million.  The Bankruptcy Court converted the
Debtor's case to a chapter 7 liquidation proceeding on May 22,
2003.  Gary M. Growe is the chapter 7 Trustee for the Debtor's
estate.  Jeffrey T. Piampiano, Esq., at Drummond Woodsum &
MacMahon represents the chapter 7 Trustee.


GREENWICH CAPITAL: Moody's Downgrades $1 Mil. Certs. Rating to B1
-----------------------------------------------------------------
Moody's Investors Service downgraded Class N-LH of Greenwich
Capital Commercial Funding Corp., Commercial Mortgage Pass
-Through Certificates, Series 2004-FL2:

   * Class N-LH, $1,000,000, Floating, downgraded to B1 from Ba2

Class N-LH was downgraded to Ba2 from Baa3 and placed on review
for further downgrade on Sept. 20, 2005 due to the deterioration
of property performance of the Logan Airport Embassy Suites Hotel,
which is located at Logan Airport in Boston, Massachusetts.  The
loan is secured by a leasehold interest in a 273-room full service
hotel that was constructed in 2003.  This floating rate loan
matures in April 2007 and the borrower has two one-year extension
options.  The $32.0 million mortgage loan is comprised of an $18.0
million pooled senior interest, a $1.0 million trust junior
component, a $13.0 million non-trust junior component and $15.0
million of mezzanine debt.

Although property performance has improved since Moody's last full
review in Sept. 2005, calendar year 2005 operating results
provided to Moody's by the borrower indicate a 69.1% decrease in
earnings before interest, taxes, depreciation and amortization
from that at securitization due to reduced RevPAR and Food &
Beverage revenue, along with significantly higher expenses.
Moody's loan to value ratio for the total trust debt is in excess
of 100.0%.  Moody's is therefore downgrading Class N-LH to B1 from
Ba2.


GSMPS MORTGAGE: Moody's Puts Low-B Ratings on Three Subord. Certs.
------------------------------------------------------------------  
Moody's Investors Service assigned an Aaa rating to the senior
certificates issued by GSMPS Mortgage Loan Trust 2006-RP1 Mortgage
Pass-Through Certificates, Series 2006-RP1, and ratings ranging
from Aa2 to B2 to the subordinate certificates in the deal.  The
transaction consists of the securitization of FHA insured, and VA
or RHS guaranteed reperforming loans virtually all of which were
repurchased from GNMA pools.

The credit quality of the mortgage loans underlying this
securitization is comparable to that of mortgage loans underlying
sub-prime securitizations.  However after the FHA, VA and RHS
insurance is applied to the loans, the credit enhancement levels
are comparable to the credit enhancement levels for prime-quality
residential mortgage loan securitizations.  The insurance covers a
large percent of any losses incurred as a result of borrower
defaults.  Moody's expects collateral losses to range from 0.40%
to 0.50%.

The Federal Housing Administration is a federal agency within the
Department of Housing and Urban Development whose mission is to
expand opportunities for affordable home ownership, rental
housing, and healthcare facilities.  The Department of Veterans
Affairs, formerly known as the Veterans Administration, is a
cabinet-level agency of the federal government.  The Rural Housing
Service is a part of the U.S. Department of Agriculture. The
ratings are based on the credit quality of the underlying loans
and the insurance provided by FHA and the guarantee provided by
the VA and RHS.  Specifically, in Pool 1 about 83% of the loans
have insurance provided by FHA, 16% from the VA, and less than 1%
from the RHS.  In Pool 2, about 97% of the loans have insurance
provided by FHA and 3% from the VA.  The ratings are also based on
the structural and legal integrity of the transaction.

The Complete Rating Actions are:

   * Class 1AF1, Assigned Aaa
   * Class 1AF2, Assigned Aaa
   * Class 1AS, Assigned Aaa
   * Class 1A2, Assigned Aaa
   * Class 1A3, Assigned Aaa
   * Class 1A4, Assigned Aaa
   * Class AX, Assigned Aaa
   * Class 2A1, Assigned Aaa
   * Class B1, Assigned Aa2
   * Class B2, Assigned A2
   * Class B3, Assigned Baa2
   * Class B4, Assigned Ba2
   * Class B5, Assigned B2

The notes are being offered in privately negotiated transactions
without registration under the 1933 Act.  The issuance was
designed to permit resale under Rule 144A.


HEATING OIL: Committee Brings In Pepe & Hazard as Local Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Heating
Oil Partners, L.P. and its debtor-affiliates' chapter 11 cases,
sought and obtained authority from the U.S. Bankruptcy Court for
the District of Connecticut to employ Pepe & Hazard LLP as its
local counsel.

Pepe & Hazard is expected to:

    a. participate in certain meetings of the Committee;

    b. meet with representatives of the Debtors and the Debtors'
       professionals;

    c. advise the Committee and Lowenstein Sandler PC, the
       Committee's lead counsel, regarding proceedings in the
       Court;

    d. prepare and file certain pleading and participate in
       hearings in the Court;

    e. monitor the Debtors' activities;

    f. assist the Committee and Lowenstein in maximizing the value
       to be realized for the unsecured creditors of the Debtors
       from the Debtors' sale of assets;

    g. assist the Committee and Lowenstein in formulating and
       negotiating a chapter 11 plan and advising creditors of the
       Committee's recommendation with respect to any such plan;
       and

    h. prosecute possible cause of action not prosecuted by
       Lowenstein.

Mark I. Fishman, Esq., partner at Pepe & Hazard, will lead the
engagement and bills $375 per hour.  Mr. Fishman says that the
other attorney will be Kristin B. Mayhew, Esq., and she bills  
$275 per hour.

Mr. Fishman discloses that Joseph W. Martini, Esq., a partner at
Pepe & Hazard, is the former husband of the U.S. Trustee.  
Nevertheless, Mr. Fishman assures the Court that the Firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.  

The Firm's Connecticut Office is located at:

         Pepe & Hazard LLP
         Goodwin Square
         Hartford, Connecticut 06103-4302
         Tel: (860) 522-5175
         Fax: (860) 522-2796
         http://www.pepehazard.com/

Headquartered in Darien, Connecticut, Heating Oil Partners, L.P.
-- http://www.hopheat.com/-- is one of the largest residential   
heating oil distributors in the United States, serving
approximately 150,000 customers in the Northeastern United States.
The Company's primary business is the distribution of heating oil
and other refined liquid petroleum products to residential and
commercial customers.  The Company and its subsidiaries filed for
chapter 11 protection on Sept. 26, 2005 (Bankr. D. Conn. Case No.
05-51271) and filed for recognition of the chapter 11 proceedings
under the Companies' Creditors Arrangement Act (Canada).  Craig I.
Lifland, Esq., and James Berman, Esq., at Zeisler and Zeisler,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$127,278,000 in total assets and $155,033,000 in total debts.


INT'L RECTIFIER: Fitch Affirms B+ Sr. Subordinated Debt's Rating
----------------------------------------------------------------
Fitch Ratings revised International Rectifier Corp.'s (IR) Rating
Outlook to Positive from Stable and affirmed the company's 'BB-'
issuer default rating.  The ratings on IR's 'B+' senior
subordinated debt and 'BB' senior secured bank credit facility are
also affirmed.  Fitch's action affects approximately $550 million
of public debt securities.

The Positive Outlook reflects Fitch's expectations that:

   * IR's richer sales mix;

   * anticipated divestiture of its non-aligned products segment;
     and

   * positive longer term power management growth trends

will result in IR achieving a stronger operating and financial
profile, albeit still within the context of the semiconductor
cycle.

IR has steadily increased its mix of higher gross margin Focus
products to 75% of revenues for the latest 12 months ended
Dec. 31, 2005, from less than 60% for fiscal year 2003, driving
corporate-wide gross margins to 42% from 33% over the same time
frame.  Fitch also believes the company's proprietary products
provide greater visibility and, therefore, are less susceptible to
gross margin erosion.  Fitch notes that IR's contemplated
divestiture of its Non-Aligned Products segment (approximately 9%
of revenues for the LTM ended Dec. 31, 2005), if successful, will
further strengthen the company's operating profile, as this
segment historically has been characterized by lower and more
volatile gross margins.  This divestiture, which IR is targeting
for completion by mid-2006, would follow IR's discontinuation of
certain noncore product lines beginning in fiscal year 2004, which
represented approximately $100 million of annual revenues.

The ratings continue to reflect IR's:

   a) significant ongoing capital expenditures and investments in
      research and development, likely representing 20%-25%
      of revenues;

   b) likelihood that total debt will remain near current levels,
      given Fitch's expectations that IR will refinance the $550
      million of convertible notes due in July 2007;

   c) small size relative to major competitors, several of which
      are large integrated semiconductor providers; and

   d) exposure to the cyclical demand patterns and volatile cash
      flows associated with the semiconductor industry.

Ratings strengths center on IR's:

   * consistently positive (albeit modest) annual free cash flow;

   * leading positions in several power management markets;

   * strong and focused intellectual property portfolio;

   * diversified end market exposure; and

   * relatively conservative financial strategy, including a solid
     liquidity position.

While IR has experienced recent negative quarterly revenue growth
and some gross margin contraction over the past few quarters,
longer-term operating trends continue to be positive.  Revenue
declines were due to a combination of capacity constraints in
focus products, as well as pricing pressures, past
discontinuations and other efforts to reduce exposure within
commodity products.  While recognizing that IR has benefited from
a prolonged semiconductor market expansion, the power management
market is expected to grow in the upper single digits for calendar
year 2006 and over the intermediate-term, driven primarily by
increased power management content, as well as continued (albeit
less robust) end market growth.

Over the near-term, Fitch believes IR's high utilization rates (in
excess of 90%), positive book-to-bill ratio, backlog representing
approximately 80% of revenues targeted for the March 2006 quarter,
and historically lean inventory positions at components
distributors (which represent approximately 20% of IR's revenues)
should drive positive operating momentum for the first half of
calendar year 2006.  Also, IR's manufacturing capacity expansion,
scheduled to be completed by October 2006, is expected to
alleviate some of the company's capacity constraints that have
caused lost revenues in recent quarters.  Fitch notes that IR, as
well as the overall semiconductor industry, have been more
disciplined in adding capacity than historically, which should
somewhat mitigate the supply and demand imbalances that have
driven substantial cash flow volatility in previous cycles.

As of Dec. 31, 2005, IR's liquidity was sufficient to meet near-
term obligations, including potentially repurchasing up to $100
million of common stock, and consisted of approximately $920
million of cash and short- and long-term investments and a $150
million senior secured revolving credit facility expiring November
2006.  Historically, free cash flow also has supported liquidity,
averaging more than $50 million annually over the past four years,
although Fitch believes this could be pressured in fiscal 2006
driven primarily by the temporarily elevated capital expenditures
to add capacity in IR's most advanced manufacturing facility.
Total debt consists of the aforementioned $550 million 4.25%
convertible subordinated notes due in July 2007.


INZON CORP: Increased Costs Lead to Higher Losses in 1st Quarter
----------------------------------------------------------------
InZon Corporation delivered its financial results for the quarter
ended Dec. 31, 2005, to the Securities and Exchange Commission on
Feb. 9, 2006.

In the first quarter of fiscal year 2006, InZon reported a
$581,019 net loss, as compared to a $38,925 net loss for the three
months ended Dec. 31, 2004.  Management attributes the increase
primarily to higher costs of the Company's operations to support
the sales levels reached for the current quarter, combined with
the lag associated with the revenues represented by these sales.

The Company generated $2,748,599 of revenue for the three months
ended Dec. 31, 2005, compared to zero revenue for the comparable
period in the prior year.  The current period is the Company's
first quarter of full operation of its business.

The Company's balance sheet at Dec. 31, 2005, showed $2,156,049 in
total assets and liabilities of $2,200,062, resulting in a
stockholders' deficit of $44,013.  As of Dec. 31, 2005, the
Company had a $1,372,725 net working capital deficit, versus a
$519,065 net working capital deficit at Dec. 31, 2004.

                   Going Concern Doubt

George Brenner, CPA, expressed substantial doubt about InZon's
ability to continue as a going concern after he audited the
Company's financial statements for the year ended Sept. 30, 2005,
and the period May 14, 2004 (inception) through Sept. 30, 2004.  
Mr. Brenner pointed to the Company's losses from start-up
operations, substantial need for working capital and accumulated
deficit of $1,394,670 at Sept. 30, 2005.  

                       About InZon

Based in Delray Beach, Florida, InZon Corporation provides
telecommunication services in the United States.  The company
offers voice over Internet protocol (VoIP) services to tier 1 and
tier 2 carriers. Its VoIP technology provides voice, fax, data,
conference call, and Internet services over a private Internet
protocol network to international carriers and other communication
service providers.


J.L. FRENCH: Bankruptcy Court Approves First Day Motions
--------------------------------------------------------
J.L. French Automotive Castings, Inc., reported that the U.S.
Bankruptcy Court for the District of Delaware approved its first
motions, which included:

    * access to $25 million in interim debtor-in-possession
      financing;

    * payment of prepetition employee wages and benefits;

    * payment of prepetition critical trade vendor claims; and

    * continued use of the Debtor's cash management system and
      banking relationships.

The Court will convene the Final DIP Financing Hearing on March 3,
2006.  The Debtor seeks to obtain $50 million in fresh financing.

Headquartered in Sheboygan, Wisconsin, J.L. French Automotive
Castings, Inc. -- http://www.jlfrench.com/-- is one of the   
world's leading global suppliers of die cast aluminum components
and assemblies.  There are currently nine manufacturing locations
around the world including plants in the United States, United
Kingdom, Spain, and Mexico.  The company has fourteen
engineering/customer service offices to globally support our
customers near their regional engineering and manufacturing
locations.  The Company and its debtor-affiliates filed for
chapter 11 protection on Feb. 10, 2006 (Bankr. D. Del. Case No.
06-10119 to 06-06-10127).  James E. O'Neill, Esq., Laura Davis
Jones, Esq., and Sandra G.M. Selzer, Esq., at Pachulski Stang
Ziehl Young & Jones, and Marc Kiesolstein, P.C., at Kirkland &
Ellis LLP, represent the Debtors in their restructuring efforts.  
When the Debtor filed for chapter 11 protection, it estimated
assets and debts of more than $100 million.


KAISER ALUMINUM: KACC Balks at Gramercy's $5-Mil. Admin. Claim
--------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
Jan. 9, 2006, Gramercy Alumina, LLC, and St. Ann Bauxite Limited
asked the U.S. Bankruptcy Court for the District of Delaware to:

   (1) declare that Kaiser Aluminum Corporation breached the
       Purchase Agreement because they failed to list or otherwise
       disclose or describe the retirement plans and the accrued
       retirement benefits in the Purchase Agreement;

   (2) declare that the Debtors breached the Purchase Agreement
       because they failed to satisfy the accrued retirement
       benefits that stood at $7,200,000 on the closing date;

   (3) determine that the Debtors are obligated to pay them
       $5,000,000 in connection with liabilities unknowingly
       incurred and damages suffered for at least $7,200,000.  
       The Debtors' indemnification obligations are limited to
       $5,000,000 under the Purchase Agreement; and

   (4) direct the Debtors to pay them $5,000,000 as an
       administrative expense payable under the Debtors' Chapter
       11 case

                      KACC and KBC Respond

Kaiser Aluminum & Chemical Corporation and Kaiser Bauxite Company
deny the allegations asserted by Gramercy and St. Ann.

Kimberly Newmarch, Esq., at Richards, Layton & Finger, in
Wilmington, Delaware, argues that there is no truth to Gramercy
and SABL's allegations relating to:

   * the notification of accrued retirement benefits from
     Rambarran & Associates Limited Consulting Actuaries; and

   * "discovery" of the existence of the retirement plans or the
     accrued retirement benefits.

KACC and KBC deny the allegations regarding the disclosure of the
retirement plans or the accrued retirement benefits in the
purchase agreement or its exhibits and schedules.  They also deny
the allegation that they continuously provided benefits under the
retirement plans to retired employees since 1978.

Ms. Newmarch points out that Gramercy and SABL's complaint fails
to state a claim on which relief can be granted.  Gramercy and
SABL's claims are likewise barred under the doctrines of waiver,
ratification, and release or accord and satisfaction.

KACC and KBC contend that Gramercy and SABL are not entitled to
the requests they seek including the award of $5,000,000 in
damages.  Hence, no request for administrative claim can be
entertained.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading  
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
February 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold
off a number of its commodity businesses during course of its
cases.  Corinne Ball, Esq., at Jones Day, represents the Debtors
in their restructuring efforts.  On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 90; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


LEHMAN XS: Moody's Assigns Ba2 Rating on Class B Notes
------------------------------------------------------
Moody's Investors Service assigned a rating of A3 to the Class A
notes and a rating of Ba2 to the Class B notes of Lehman XS Net
Interest Margin Notes, Series 2005-10.  The notes are backed by
the residual and prepayment penalty cash flows from the LXS 2005-
10 Alt-A mortgage securitization.

Daniel Gringauz, a Moody's analyst, says that the ratings assigned
to the notes are based primarily on the adequacy of cash flows
from the underlying transaction's prepayment penalty and residual
certificates.

The risk faced by the LXS 2005-10 NIM noteholders depends on the
size and timing of the excess spread and prepayment penalty cash
flows.  According to Daniel Gringauz, the cash flows available to
repay the notes are most significantly impacted by the level of
prepayments, as well as the timing and amount of losses on the
underlying mortgage pool.  The prepayment penalty and excess
spread cash flows counter-balance each other, thus stabilizing
cash flows in various prepayment environments.  High prepayment
speeds on the underlying loans reduce excess spread cash flows but
increase prepayment penalty cash flows and vice versa. Moody's
applied various combinations of loss and prepayment scenarios to
evaluate the adequacy of cash flows to fully amortize the rated
notes.

The complete rating actions are:

   Issuer: Lehman XS NIM Company 2005-10

   Co-Issuer: SASCO ARC Corporation

   Securities: Lehman XS Net Interest Margin Notes,
               Series 2005-10

      * Class A Notes, rated A3

      * Class B Notes, rated Ba2


The notes are being offered in privately negotiated transactions
without registration under the 1933 Act.  The issuance was
designed to permit resale under Rule 144A.


LEVEL 3 COMM: Posts $169 Million Net Loss in 4th Quarter of 2005
----------------------------------------------------------------
Level 3 Communications, Inc., incurred a $169 million net loss for
the quarter ended Dec. 31, 2005, compared to a $204 million net
loss in the third quarter of 2005.

Included in the net loss for the fourth quarter are:

   a) a net loss of $3 million as a result of the acquisition of
      WilTel Communications on Dec. 23, 2005; and

   b) income of approximately $49 million associated with the
      gain from the sale of Structure, LLC, the Company's wholly
      owned IT infrastructure management outsourcing subsidiary
      to Infocrossing, Inc., Nov. 30, 2005, and the results of
      its operations through the closing date of the sale.

For the three months ended Dec. 31, 2005, the Company generated
consolidated revenue of $944 million, versus $782 million of
consolidated revenue for the third quarter of 2005.

            Consolidated Cash Flow and Liquidity

In the fourth quarter of 2005, the Company reported unlevered cash
flow of negative $12 million, versus positive $45 million during
the third quarter.  Consolidated free cash flow for the fourth
quarter was negative $160 million, versus negative $50 million for
the previous quarter.

For the full year 2005, unlevered cash flow was negative $9
million compared to $58 million in 2004, and consolidated free
cash flow decreased to negative $425 million in 2005 compared to
negative $350 million last year.

Management expects to file its financial results for the quarter
and year ended Dec. 31, 2005, with the Securities and Exchange
Commission next month.

                     Mergers and Acquisitions

The company closed its previously announced acquisition of WilTel
Communications on Dec. 23, 2005, for consideration of 115 million
shares of Level 3 common stock and $386 million in cash, subject
to final purchase price or working capital adjustments.  As a
consequence of the completion of the acquisition of WilTel
Communications, the company is in the process of completing its
purchase accounting adjustments to the consolidated balance
sheet.  

Level 3 Communications (Nasdaq: LVLT) -- http://www.Level3.com/
-- is an international communications and information services
company.  The company operates one of the largest Internet
backbones in the world, is one of the largest providers of
wholesale dial-up service to ISPs in North America and is the
primary provider of Internet connectivity for millions of
broadband subscribers, through its cable and DSL partners.  The
company offers a wide range of communications services over its
23,000-mile broadband fiber optic network including Internet
Protocol (IP) services, broadband transport and infrastructure
services, colocation services, and patented softswitch managed
modem and voice services.

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 12, 2006,
Standard & Poor's Ratings Services assigned its 'CCC-' rating
to the Company's proposed offering of up to $1.23 billion of
11.5% senior notes due 2010.  

The notes are being offered in exchange for an aggregate of up to
$1.23 billion of the company's debt maturing in 2008, consisting
of its 9.125% senior notes, 11% senior notes, and 10.5% senior
discount notes.

The Company's balance sheet at Sept. 30, 2005, showed $7.5 billion
in total assets and liabilities of $8.2 billion, resulting in a
stockholders' deficit of $632 million.


LODGENET ENTERTAINMENT: Posts $2.3 Mil. Net Loss in Fourth Quarter
------------------------------------------------------------------
LodgeNet Entertainment Corporation (Nasdaq: LNET) reported revenue
of $275.8 million, for the quarter ended Dec. 31, 2005, a 3.5%
increase compared to 2004, and its 49th consecutive increase of
comparative quarterly revenue.

Revenue for the quarter increased 4.4% to $67.5 million as
compared to $64.7 million for the fourth quarter of 2004 as total
monthly Guest Pay and movie revenue per room increased 2.0% and
1.8%, respectively.  

For the full year 2005, operating income increased to $22.7
million compared to $13.0 million in 2004.  Net loss for 2005 was
$7 million versus net loss of $20.8 million in 2004.  LodgeNet
also reported $12.8 million in net free cash flow for the entire
year of 2005 as compared to $6.3 million in 2004.

"2005 was a year of significant accomplishments from both a
financial and competitive standpoint as we continued to execute on
our strategic plan of growing our business while simultaneously
generating increasing levels of net free cash flow and improving
profitability," Scott C. Petersen, LodgeNet President and CEO
said.  "We are especially pleased to report that total Guest Pay
revenue and movie revenue per room per month for the quarter were
both up over the same period last year.  For the full year, we are
also very encouraged by the progress we made in generating net
free cash flow, which more than doubled, and in driving
profitability, increasing operating income by 75% and reducing our
net loss by two-thirds."

"In the fourth quarter, seasonally our weakest, we were
essentially net cash flow breakeven, driven by positive per-room
revenue gains and a continued focus on managing our operating
costs and capital investment program," Gary H. Ritondaro, LodgeNet
Senior Vice President and CFO said.  "For the full year, cash
provided by operating activities was $64.3 million, a 6% increase
over 2004, with net free cash flow of $12.8 million.  We more than
doubled net free cash flow from $6.3 million last year even as we
grew our digital base by 120,000 rooms.  Digital rooms now
comprise 63% of our entire interactive room base."

"During 2005, we also made significant progress in deleveraging
our balance sheet," Ritondaro continued.  "We ended the year with
$292 million in long-term debt, a reduction of approximately $21
million over year-end 2004, which resulted in an 8% decrease in
interest expense during 2005.  In January, 2006 we reduced our
long-term debt by an additional $10 million and presently have a
long-term debt leverage ratio of 3.06 times."

"While we have achieved substantial success with regard to our
financial goals, we also had significant market-based success,"
Petersen said.  "During the year, we signed contracts for an
incremental 68,000 rooms; we extended our relationship with The
Ritz-Carlton Hotel Company through 2011 based on our industry
leading HDTV system offering; and in December, Starwood Hotels
named LodgeNet its sole preferred provider for interactive
television services for its Westin, W, Sheraton and Four Points
brands due in large part to our ability to execute on their
sophisticated requirements for content management."

"We enter 2006 focused on growth, profitability and cash flow
generation," Petersen continued.  "We are working to drive more
revenue through enhanced marketing, new programming content such
as our daily subscription Hotel SportsNet(SM) service, and through
our targeted advertising initiative.  We also believe we are well
positioned to grow our room base with our integrated sigNETure(SM)
Solutions for high-definition television, hotel marketing
applications and Internet connectivity, all supported by our world
class service.  In addition, we remain focused on diversifying our
revenue streams by continuing to develop our Healthcare
initiative, now with nine facilities under contract, and by
exploring other adjacent markets."

                      Results From Operations

Total revenue for the fourth quarter of 2005 was $67.5 million, an
increase of $2.8 million, or 4.4%, compared to the fourth quarter
of 2004.  Revenue from Guest Pay services increased $3.6 million,
or 5.8%, resulting from both a 3.7% increase in the average number
of rooms in operation and by a 2.0% increase in revenue realized
per average Guest Pay room.

Monthly Guest Pay revenue per room was $22.00 in the fourth
quarter of 2005 as compared to $21.57 for the fourth quarter of
2004.  The company generated this result despite having had
approximately 9,000 rooms out of operation because of Hurricane
Katrina.

The company estimate the impact from having these rooms out of
service reduced Guest Pay revenue by approximately $700,000 in the
fourth quarter of 2005 or approximately $0.24 per room.  Movie
revenue per room increased 1.8% to $16.66 this quarter as compared
to $16.37 in the year earlier quarter.  Revenue per room from
other interactive services increased 2.7%, from $5.20 per month in
the fourth quarter of 2004 to $5.34 in the current year quarter.

The increase was primarily due to price changes associated with
basic cable services and increased revenue from the high-speed
Internet access -- HSIA -- services.  This was offset in part by
our TV Internet profitability enhancement initiative that removed
poorly performing rooms from service.  The company estimate that
the TV Internet initiative decreased revenue by approximately
$325,000, or about $0.12 per room, while lowering direct operating
costs by approximately $726,000.

Total direct costs increased $1.3 million, or 4.5% to
$30.5 million in the fourth quarter of 2005, compared to
$29.2 million in the prior year's quarter.  As a percentage of
revenue, total direct costs remained flat at 45.2% in the fourth
quarter of 2005 as compared to the fourth quarter of 2004.

Guest Pay operations expenses were $8.8 million in the fourth
quarter of 2005, a 1.7% increase, compared to $8.7 million in the
fourth quarter of 2004.  The increase was due to the 3.7% increase
in the average number of rooms served, offset by decreases in
general operating and insurance expenses and by greater
efficiencies associated with our expanding digital room base.

Guest Pay operations expenses as a percentage of revenue were
13.0% as compared to 13.4% in the fourth quarter of 2004.  Per
average installed room, Guest Pay operations expenses decreased
2.0% to $2.95 per month in the fourth quarter of 2005, compared to
$3.01 per month in the prior year quarter.

Operating income increased to $4.9 million in the fourth quarter
of 2005 as compared to $2.3 million in the prior year quarter.  
The $4.9 million included a net insurance recovery of $758,000
related to Hurricane Katrina.  Adjusted Operating Cash Flow
increased 1.8% to $21.4 million for the fourth quarter of 2005
compared to $21.1 million in the fourth quarter of 2004.

Net loss was $2.3 million for the fourth quarter of 2005, an
improvement of $3.8 million as compared to a $6.1 million net loss
in the year earlier quarter.  

For the quarter, cash provided by operating activities was
$12.1 million while cash used for investing activities, including
growth-related capital, was $12.2 million.  During the fourth
quarter of 2004, cash provided by operating activities was
$6.7 million while cash used for investing activities, including
growth-related capital, was $13.7 million, resulting in negative
net cash flow of $7.0 million.

During the quarter, 13,419 new digital rooms were installed
compared to 27,475 new digital rooms installed during the
fourth quarter of 2004, when the company installed a substantial
number of newly contracted FelCor Lodging rooms.  The average cost
per newly installed digital room was $359 during the fourth
quarter of 2005, compared to $341 for the fourth quarter of 2004.
The increase in cost per room was primarily attributable to the
mix of sites, which had a lower average number of rooms per site.  
The cost of converting a tape-based room to a digital room was
$250 in the fourth quarter of 2005, compared to $263 in the same
period last year.

                      Results From Operations

Total revenue for 2005 was $275.8 million, an increase of
$9.3 million, or 3.5%, compared to 2004.  Revenue from Guest Pay
services increased $9.2 million, or 3.6%, resulting from a 5.1%
increase in the average number of rooms in operation, and offset
in part by a 1.4% decrease in revenue per average Guest Pay room.

The decrease in revenue per average Guest Pay room was primarily
attributable to lower movie purchases in the first three quarters,
our TV Internet profitability enhancement initiative, and the
impact from Hurricane Katrina.  The company estimate the impact
from having rooms out of service due to the Hurricane reduced
Guest Pay revenue in 2005 by approximately $1.1 million.  The TV
Internet initiative, which removed poorly performing rooms from
service, is estimated to have reduced revenue by approximately
$1.4 million, while lowering direct operating costs by
approximately $2.9 million.

Movie revenue per room decreased 2.2% to $17.00 this year as
compared to $17.39 in the prior year.  Monthly Guest Pay revenue
per room was $22.53 in 2005 as compared to $22.86 in 2004.  
Revenue per room from other interactive services increased 1.1%,
from $5.47 per month in 2004 to $5.53 in the current year.  The
increase was primarily due to price changes associated with basic
cable services and increased revenue from the high-speed Internet
access services.

Total direct costs increased $4.0 million, or 3.4% to
$123.2 million in 2005, compared to $119.2 million in the prior
year.  As a percentage of revenue, total direct costs remained
flat at 44.7% in 2005 as compared to 2004.  Guest Pay direct costs
as a percentage of Guest Pay revenue decreased to 44.5% for 2005
as compared to 44.7% last year while costs related to HSIA
equipment sales increased over 2004.

Guest Pay operations expenses were $35.1 million in 2005, a 4.4%
increase, compared to $33.6 million last year.  The increase was
primarily due to the 5.1% increase in the average number of rooms
served and other increased costs such as labor, property taxes,
freight, fuel and other vehicle related costs.

These increases were offset in part by greater efficiencies
associated with an expanding digital room base.  Guest Pay
operations expenses as a percentage of revenue were 12.7% as
compared to 12.6% in 2004.  Per average installed room, Guest Pay
operations expenses decreased to $2.96 per month in 2005, compared
to $2.97 per month in the prior year.

Other operating income of $508,000 in 2005 included insurance
proceeds associated with the Hurricane Katrina recovery of
$788,000 offset by a $280,000 charge for equipment impairment.

Operating income increased 75.0% to $22.7 million in 2005 as
compared to $13.0 million in the prior year.  The $22.7 million
included a net insurance recovery of $508,000 related to the
Hurricane Katrina impact.  Adjusted Operating Cash Flow increased
2.4% to $92.3 million for 2005 compared to $90.2 million in 2004.

Net loss was $7.0 million for 2005, an improvement of $13.8
million as compared to a $20.8 million net loss in the previous
year.  

Cash provided by operating activities for 2005 was $64.3 million
while cash used for investing activities, including growth-related
capital, was $51.5 million, resulting in net free cash flow of
$12.8 million.  During 2004, cash provided by operating activities
was $60.6 million while cash used for investing activities,
including growth-related capital, was $54.3 million, resulting in
net free cash flow of $6.3 million.  Cash on the balance sheet as
of Dec. 31, 2005, was $20.7 million versus $25.0 million as of
Dec. 31, 2004.

In 2005, 71,731 new digital rooms were installed compared to
75,932 new digital rooms installed in 2004.  The average cost per
newly installed digital room decreased 6.6% to $340 during 2005,
compared to $364 during 2004.  The cost of converting a tape-based
room to a digital room decreased 7.8% to $262 for 2005, compared
to $284 in 2004.

At Dec. 31, 2005, LodgeNet Entertainment Corporation's balance
sheet showed a $70,233,000 stockholders' deficit, compared to a
$72,118,000 deficit at Dec. 31, 2004.

LodgeNet Entertainment Corporation (NASDAQ: LNET) --
http://www.lodgenet.com/-- is the world's largest provider of  
interactive television and broadband solutions to
hotels throughout the United States and Canada as well as select
international markets.  These services include on-demand movies,
music and music videos, on-demand videogames, Internet on
television, and television on-demand programming, as well as high-
speed Internet access, all designed to serve the needs of the
lodging industry and the traveling public.  LodgeNet provides
service to more than one million interactive guest pay rooms and
serves more than 6,000 hotel properties worldwide.  LodgeNet
estimates that during 2005, approximately 300 million travelers
had access to LodgeNet's interactive television systems.  In
addition, LodgeNet is an innovator in the delivery of on-demand
patient education, information and entertainment to
medical care facilities.


MAJESTIC STAR: Moody's Lifts Rating on $80 Mil. Sr. Loan to Ba3
---------------------------------------------------------------
Moody's Investors Service upgraded Majestic Star Casino, L.L.C.'s
$80 million senior secured bank loan rating to Ba3 from B1.  The
upgrade followed the Dec. 2005 issuance of Majestic Holdco
L.L.C.'s $55 million 12% senior discount notes, and the issuance
of Majestic Star's $30 million 9-1/2% senior secured notes and
$200 million 10% senior guaranteed unsecured notes.

Following the upgrade, Moody's will withdraw the rating on
Majestic Star's $80 million senior secured bank loan for business
reasons.  No other ratings were affected by this action.  This
rating action ends the review process that began on Dec. 9, 2005,
when Moody's placed Majestic Star's bank loan rating on review for
possible upgrade.

Majestic Star's $80 million senior secured bank loan is now two
notches higher than the company's B2 corporate family rating. This
two-notch difference reflects the bank loan's prior lien status
over the company's senior secured notes, as well as the benefits
from the larger asset base and increased amount of debt
subordinated to it.  Prior to the upgrade, the bank loan was rated
one notch higher than the senior secured notes.

Majestic Star Casino, L.L.C., directly and indirectly owns and
operates riverboat casinos in Gary, Indiana, Tunica, Mississippi,
and Black Hawk, Colorado.  Majestic Star Holdco, L.L.C. owns 100%
of Majestic Star Casino, L.L.C.


NAVISTAR INT'L: Receives $1.5 Billion Loan Commitment from Lenders
------------------------------------------------------------------
Navistar International Corporation (NYSE:NAV) has entered into a
commitment letter dated February 9, 2006 with:

    * Credit Suisse;
    * Credit Suisse Securities (USA) LLC;
    * J.P. Morgan Chase Bank;
    * J.P. Morgan Securities Inc.;
    * Banc of America Securities LLC;
    * Banc of America Bridge LLC;
    * Citigroup Global Markets Inc.; and
    * Citigroup North America, Inc.

under which the Four Lenders have committed to provide the Company
with a 3-year senior unsecured term loan facility in the aggregate
principal amount of $1,500,000,000. The Loan will be guaranteed by
International Truck and Engine Corporation, the principal
operating subsidiary of the Company. The commitment to fund the
Loan Facility will expire August 7, 2006.  If the commitment is
terminated or expires, or if and to the extent the Loan Facility
is funded, the Company will have to pay certain fees, the total of
which the Company does not believe would be material to its
financial position or results of operations.

The Loan Facility will accrue interest at a rate equal to an
adjusted LIBOR rate plus a spread. The spread, which will be based
on the company's credit ratings in effect from time to time, may
range from 450 basis points to 700 basis points and will increase
by an additional 50 basis points at the end of the twelve-month
period following the date of the first borrowing and by an
additional 25 basis points at the end of each subsequent six-month
period.

Upon meeting the terms and conditions of the commitment, the
proceeds from the loan facility could be used to refinance any or
all of the company's outstanding notes that are allegedly in
default as the result of a delay in filing its fiscal 2005 annual
report.  Navistar received notices from the trustee of its
existing notes that it is in default on four series of the
company's existing debt.  The company disputes the notices of
default contained in the notification letters.

Daniel C. Ustian, Navistar chairman, president and chief executive
officer, said failure to file the Form 10-K for the fiscal year
ended Oct. 31, 2005, on time does not impact the financial
strength and earnings power of the company and noted that the
company's ability to secure a commitment is a positive sign of the
company's continued strength.

On Jan. 17, 2006, Navistar reported that it would not file its
Form 10-K by the filing deadline because it is still in
discussions with its outside auditors about a number of complex
and technical accounting items.  The company continues to work
toward a resolution of these items and progress is being made on
reaching a conclusion.

"It is unfortunate that our delay in reporting fiscal 2005
financial results is overshadowing all the positive actions
underway at our company," Mr. Ustian said.  "This week's
announcement that the U.S. Army has narrowed the field of
contractors to build its next generation tactical military vehicle
is a perfect example."

Mr. Ustian said the selection of International and Lockheed Martin
represents a shift in the way the Pentagon purchases military
equipment since neither company is among the traditional suppliers
of light and medium tactical vehicles, but rather are among the
companies that have developed state-of-the-art technology
applicable to the military's future needs when in combat.

Bondholders in each of the following series of the company's
outstanding long-term debt have tendered default notices:

     * 2-1/2% senior convertible notes totaling $190 million due
       2007;

     * 9-3/8% senior notes totaling $400 million due 2006;

     * 6-1/4% senior notes totaling $250 million due 2012; and

     * 7-1/2% senior notes totaling $400 million due 2011.

All of the bond issues contain provisions that allow the company a
cure period from receipt of the notice to file its annual report.  
The 2-1/2% notes carry a 60-day cure period, while all other notes
provide 30 days.

The company believes that it has adequate resources available to
continue to fund its operations and repay any notes, which are in
default, and believes that notices of default will not have a
material adverse effect on the company's liquidity position or
financial condition.

Full-text copies of the credit facility and default notices are
available at no charge at http://ResearchArchives.com/t/s?541

Headquartered in Warrenville, Illinois, Navistar International
Corporation -- http://www.nav-international.com/-- is the parent  
company of International Truck and Engine Corporation.  The
company produces International(R) brand commercial trucks, mid-
range diesel engines and IC brand school buses, Workhorse brand
chassis for motor homes and step vans, and is a private label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets.  The company is also a provider of truck and
diesel engine parts and service sold under the International(R)
brand.  A wholly owned subsidiary offers financing services.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 07, 2006,
Moody's Investors Service lowered the ratings of Navistar
International Corporation (senior unsecured to B1 from Ba3 and
subordinate to B3 from B2) and placed the ratings under review for
further possible downgrade.  Moody's rating actions followed
Navistar's announcement that it has received notice from purported
holders of more than 25% of the company's approximately $200
million senior subordinated exchangeable notes due 2009, claiming
that the company is in default of reporting requirements relating
to the filing of its financial statements for the fiscal year
ending Oct. 31, 2005.  The company disputes the allegation of
default.  Nevertheless, receipt of the notice of default
represents a further negative development for the company stemming
from its inability to file financial statements in a timely manner
because of accounting issues.

The downgrade and review reflect the heightened financial risk
stemming from uncertainty as to Navistar's ability to file its
financial statements in a timely manner given the number and
complexity of various open items that the company continues to
discuss with its auditors Deloitte and Touche.  As a result of
these open issues, Navistar cannot estimate the time frame for the
filing of its October 2005 financial statements.


NAVISTAR INT'L: Fitch Downgrades Subordinated Debt's Rating to B
----------------------------------------------------------------
Fitch downgraded the ratings of Navistar International Corp. and
its subsidiary, Navistar Financial Corp. as:

  Navistar International Corp.:

   -- Issuer default rating (IDR) to 'BB-' from 'BB'
   -- Senior unsecured debt to 'BB-' from 'BB'
   -- Subordinated debt to 'B' from 'B+'

  Navistar Financial Corp.

   -- Senior unsecured bank lines to 'BB-' from 'BB'
   -- Senior unsecured debt to 'BB-' from 'BB'

Fitch also assigned an indicative rating of 'BB-' to Navistar's
prospective $1.5 billion credit facility.

The ratings remain on Rating Watch Negative.  Resolution of the
Watch status will be contingent on the filing of audited financial
statements and resolution of Navistar's debt structure.

The downgrade reflects:

   * the protracted duration of Navistar's inability to file
     audited financial statements;

   * the scale and uncertainty of any adjustments that may be
     required;

   * uncertainties associated with the potential refinancing of
     Navistar International's debt; and

   * the potential for limited access to external capital
     following the refinancing.

Following resolution of Navistar's debt structure, liquidity will
be supplied by cash and securities, which totaled $877 million at
Oct. 31, 2005, and cash from operations.  Free cash flow is
expected to be significant, as the end market for heavy duty
trucks remains at cyclical peak levels in 2006.  Despite solid
volume growth in engines, segment margins have been pressured by
competitive pricing and high commodity prices.  Navistar is
expected to enter a projected downturn in the heavy duty truck
market with healthy cash balances.

Navistar's underfunded pension position will make a meaningful
claim on cash flows over the intermediate term, although required
contributions in 2006 are minimal.  Higher required contributions
in later years could coincide with a cyclical decline in operating
cash flows, potentially limiting Navistar's capacity to produce
free cash flow.  Pending pension legislation could result in
tighter funding requirements and adversely affect Navistar's
financial flexibility over the near term.

The indicative rating on the new credit facility is based on the
unsecured status and is subject to final documentation.  The new
unsecured credit facility alleviates concerns regarding creditor's
ability to accelerate repayment and is available to refinance
current outstanding debt (all of Navistar's debt-holders have now
submitted notices of default).  If the facility converts to a
secured basis, any unsecured notes remaining outstanding would be
downgraded.  Drawdowns under the facility would result in higher
interest expense, with potential further step-ups in pricing.  The
three-year term of the facility will require that Navistar gain
access to the capital markets within that time frame.


NAVISTAR INT'L: S&P Maintains Watch on BB- Corporate Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services held its 'BB-' corporate credit
ratings on North American heavy-duty and medium-duty truck
producer Navistar International Corp., and Navistar's subsidiary,
Navistar Financial Corp., on CreditWatch with negative
implications.  The company's senior unsecured and subordinated
debt ratings also remain on CreditWatch.  The ratings were
originally placed on CreditWatch on Jan. 17, 2006.
     
The CreditWatch update follows the company's most recent 8-K
filing.  The filing states that Navistar has received additional
notices of default from purported holders of several additional
outstanding debt instruments and that the company has received a
loan commitment of $1.5 billion from several financial
institutions and that the proceeds of the loan facility may be
used to refinance the company's outstanding debt.  Under the terms
of the company's various bond indentures, Navistar has between 30
and 60 days from the time the notice was received to cure the
default by either filing its financial statements or by receiving
a waiver from its bondholders.  Navistar had previously received a
default notice, from holders of its 4 3/4 convertible bonds;
however, the company disputes that it is in default on that
instrument.  If Navistar fails to cure the defaults, acceleration
of required payment could occur.  However, the company has
indicated that the new loan commitment should be sufficient to
cover an acceleration.
     
Standard & Poor's currently believes that Navistar will resolve
the potential defaults before the cure periods end, and that the
company is exploring a range of possibilities, which could include
repurchasing its outstanding debt obligations.  "We will monitor
Navistar's progress in reaching a prompt resolution, as well as
its current and prospective sources of liquidity," said Standard &
Poor's credit analyst Eric Ballantine.  "If it appears that the
company will be unable to resolve these potential defaults
quickly, or if the company's liquidity were to become a concern, a
multiple-notch downgrade is possible," the analyst continued.
     
At Oct. 31, 2005, Navistar had approximately $875 million of cash.
The company also has access to a $1.2 billion revolving credit
facility at finance subsidiary Navistar Financial, subject to
waivers related to filing financial statements that expire May 31,
2006, although Standard & Poor's believes that additional waivers
could be granted if needed.  In June 2006, Navistar faces nearly
$400 million of maturing debt and the company has previously
indicated that it plans to repay this obligation with cash from
operations.
     
Standard & Poor's anticipates that the ratings on Navistar will
remain on CreditWatch until the company has filed its 10-K with
the SEC and any defaults have been resolved.  Once these events
occur and if results are not materially different from previous
expectations, Standard & Poor's expects to affirm the ratings with
a stable outlook.


NOVA COMMUNICATIONS: Changes Name to Encompass Holdings, Inc.
-------------------------------------------------------------
Nova Communications Ltd. filed with the Securities and Exchange
Commission an amendment to its Article of Incorporation to change
its corporate name to Encompass Holdings, Inc.  The company said
the amendment was effective Jan. 27, 2006.

Encompass Holdings' common stock started being quoted on the OTC
Bulletin Board under its new symbol ECMH on Jan. 31, 2006.

Encompass Holdings, Inc., fka Nova Communications Ltd. and First
Colonial Ventures, is looking for companies that share a potential
for growth and a need for capital.  The company owns Aqua Xtremes,
which makes a jet-powered surfboard.  In May 2005 it acquired
Nacio Systems, a provider of outsourced information technology
services for corporate customers.

                           *     *     *

                        Going Concern Doubt

Timothy L. Steers, CPA, LLC, expressed substantial doubt about
Nova's ability to continue as a going concern after it audited the
Company's financial statements for the fiscal years ended June 30,
2005 and 2004.  The auditing firm points to the Company's
significant operating losses and working capital deficit.


NOVEMBER 2005: S&P Rates $80 Million Sr. Credit Facility at B+
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' issuer
credit rating to November 2005 Land Investors LLC.  At the same
time, a 'BB' bank loan rating with a '1' recovery rating is
assigned to a $255 million senior secured first-lien term loan due
2011 and a $50 million senior secured first-lien revolving credit
facility due 2009.  Additionally, a 'B+' bank loan rating with a
'3' recovery rating is assigned to an $80 million senior secured
second-lien credit facility due 2012.  The outlook is stable.
      
"The issuer credit rating reflects the borrower's sizeable and
concentrated investment in a large parcel of undeveloped land in
Las Vegas, Nev., as well as the lower credit quality of several of
the borrower's sponsors," explained Standard & Poor's credit
analyst George Skoufis.  "The ability and willingness of the
borrower to make timely debt service payments could be adversely
affected by construction delays and softening market conditions.
Mitigating some of these concerns are the currently favorable
housing supply and demand conditions in Las Vegas and the
sponsors' contractual obligation to purchase a significant portion
of the land and then amortize a material portion of the debt with
those proceeds."
     
While robust price appreciation in the market is considered
unsustainable and there are signs of easing, the cost basis for
the developed parcels in this master-planned community should
remain competitive should the housing market weaken modestly.


O'SULLIVAN INDUSTRIES: Court Approves Disclosure Statement
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
approved the adequacy of the Disclosure Statement explaining
O'Sullivan Industries Holdings, Inc., and its debtor-affiliates
First Amended Joint Plan of Reorganization.

The Court determined that the Disclosure Statement contains
adequate information -- the right amount of the right kind of
information -- for creditors to make informed decisions when the
Debtor asks them to vote to accept the Plan.

The company also said that it reached an agreement with the
Official Committee of Unsecured Creditors and the controlling
holders of its 10.63% Senior Secured Notes due 2008.  The company
reported that both groups support confirmation of the plan.

The Plan incorporates:

    * a cash payment for general unsecured creditors and a
      potential additional settlement for all vendors and utility
      providers electing to participate,

    * a warrant offering for the 13-3/8% senior subordinated notes
      due 2009, and

    * the conversion of the Secured Notes into substantially all
      of the equity of the reorganized company and $10 million of
      new secured notes.

The company relates that a hearing to consider confirmation of the
Plan is scheduled for March 16, 2006.

"We are very pleased to have reached this consensual agreement on
our Plan of Reorganization and the Court's approval of our amended
Disclosure Statement," stated Rick Walters, interim CEO. "This is
an important milestone in our Chapter 11 process and continues on
our timeline to emerge from bankruptcy within the next few
months."

                   Distributions Under the Plan

As reported in the Troubled Company Reporter on Jan. 10, 2006, The
Debtors provide an estimate of the Allowed amount of claims on the
Effective Date for these Classes:

      Claim Description        Estimated Claim Amount
      -----------------        ----------------------
      Administrative Claims    $5,500,000

      DIP Facility Claims      $21,800,000

      Tax Claims               $1,068,771

      Class 2A
      Unimpaired Claims        The Debtors have paid all
      (Senior Credit           outstanding Allowed Senior
      Facility Claims)         Credit Facility Claims from
                               the proceeds of the DIP
                               Facility.  The Debtors believe
                               that there will not be any
                               Allowed Senior Credit Facility
                               Claims as of the Effective
                               Date, although the Debtors do
                               not know when any balance of
                               the $500,000 deposited by them
                               into the segregated account with
                               GECC to fund indemnification
                               obligations will be returned.

      Class 2C                 $89,400,000
      Impaired Claims
      (Senior Secured
      Notes Secured Claims)

      Class 4 Claims           To date, the Debtors estimate
                               the total amount of Allowed Class
                               4 Claims to be approximately
                               $99,800,000 under the BancBoston
                               Note and the Tandy Agreements,
                               plus approximately $18,600,000 in
                               the Senior Secured Notes
                               Deficiency Claims totaling
                               approximately $118,400,000.

Under the Amended Plan, holders of Impaired Class 3 General
Unsecured Claims are entitled to a pro rata share of the
Avoidance Recoveries, if any, which will be distributed only until
the Allowed Senior Secured Notes Deficiency Claims, together with
all Senior Secured Notes Postpetition Interest, have been paid in
full.  Furthermore, the holders of Impaired Class 3 General
Unsecured Claims are entitled to vote on the Plan.
            
To date, the Debtors estimate the total amount of Allowed Class 3
Claims to be $132,000,000 by the Effective Date of the Plan.  The
total claim amount consists of:

   (a) $102,400,000 in Senior Subordinated Notes Claims;

   (b) $11,000,000 for all other General Unsecured Claims; plus

   (c) $18,600,000 in Senior Secured Notes Deficiency Claims.

A full-text copy of the Debtors' First Amended Plan of
Reorganization is available for free at:

   http://bankrupt.com/misc/OSUL1stAmendedDisclosureStatement.pdf

A full-text copy of the Debtors' First Amended Disclosure
Statement is available for free at:

   http://bankrupt.com/misc/OSUL1stAmendedPlan.pdf

Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings,
Inc. -- http://www.osullivan.com/-- designs, manufactures, and   
distributes ready-to-assemble furniture and related products,
including desks, computer work centers, bookcases, filing
cabinets, home entertainment centers, commercial furniture, garage
storage units, television, audio, and night stands, dressers, and
bedroom pieces.  O'Sullivan sells its products primarily to large
retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and
Office Depot.  The Company and its subsidiaries filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ga. Case No. 05-
83049).  On Sept. 30, 2005, the Debtor listed $161,335,000 in
assets and $254,178,000 in debts.


OAK CREEK: Wants Court to OK GMACC Agreement & Dismiss Bankr. Case
------------------------------------------------------------------
Oak Creek Park, LLC, asks the U.S. Bankruptcy Court for the
Northern District of California to approve its settlement with
GMAC Commercial Mortgage Corporation and dismiss its chapter 11
case.

The Debtor reminds the Court that it filed for bankruptcy in order
to restructure its loan with GMACC.  The Debtor tells the Court
that it intends to pay all undisputed claims in full and in cash.  
The Debtor contends that the goal of its bankruptcy has been
accomplished and dismissal of the case is in the best interest of
creditors and the estate.

                           GMACC Loan

The Debtor says that GMACC was the successor in interest in a loan
agreement dated Dec. 6, 2000 in the original principal sum of
$19.2 million as evidenced by a promissory note.  The loan is
secured by the property and related equipment, rents and leases,
as evidenced by the Deed of Trust executed by the Debtor in favor
of the original lender.

The Debtor relates that it had remained current on the Note from
December 2000 until September 2005, when it missed the September
monthly payment of $178,830.

                        GMACC Agreement

The Debtor tells the Court that on Jan. 25, 2006, it entered into
a Proposed Restructure Term Sheet with GMACC.  The terms of the
agreement includes:

    (a) the loan to continue being secured by the property and
        related collateral and the Debtor will not pledge any
        interest in the Collateral to any other entity;

    (b) the maturity date of the Note will be changed to Dec. 31,
        2009;

    (c) GMACC will forgive $1.5 million of the principal amount
        when the loan is repaid in full provided no incident of
        monetary or material non-monetary defaults under the loan
        documents occur;

    (d) on the effective date of the Restructure Loan Documents,
        the Debtor will pay GMACC:

         -- reserve payments totaling $142,487, and

         -- $950,000 for all past due monthly installment to make
            the loan current,

    (e) all default interest and later charges will be waived by
        GMACC;

    (f) on the date in which GMACC and the Debtor execute the
        Restructure Loan Documents, the Debtor will pay GMACC all
        lenders expenses incurred by GMACC;

    (g) the Debtor will pay Avnet the remainder of the unpaid
        incentive payment;

    (h) GMACC will agree to a one-time waiver of the Yield
        Maintenance Payments and other prepayment penalties due
        under the Notes, provided that all obligations are paid in
        full by Jan. 1, 2007; and

    (i) the Debtor and GMACC will release each other from any and
        all liabilities or claims relates to the loan, loan
        documents or transactions contemplated by the term sheet.

Headquartered in San Francisco, California, Oak Creek Park, LLC,
filed for chapter 11 protection on Sept. 21, 2005 (Bankr. N.D.
Calif. Case No. 05-56102).  Desmond Cussen, Esq., Gibson, Dunn &
Crutcher LLP represent the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated assets and debts between $10 million and $50 million.


ON SEMICONDUCTOR: Cuts Interest Rate on $639.1M of Term Loans
-------------------------------------------------------------
ON Semiconductor Corporation (NASDAQ: ONNN) has successfully
refinanced approximately $639.1 million of term loans under its
senior secured credit facilities to reduce the interest rate it
pays from LIBOR plus 275 basis points to LIBOR plus 250 basis
points.  The amended and restated credit agreement also provides
for a step down provision that would further reduce the interest
rate to LIBOR plus 225 basis points if the Company has a credit
rating of at least B2 (with stable outlook) from Moody's and meets
a specified leverage ratio test that would first apply based on
the 2005 fiscal year results.  The Company currently anticipates
it should meet this step down condition on or around the filing of
its Form 10-K for the year ended December 31, 2005.

"The reduction of the spread on our senior secured credit
facilities is attributable to the improving financial performance
of the Company," said Donald Colvin, ON Semiconductor senior vice
president and CFO.  "As part of our long-term financial strategy,
we plan to use the cash generated from operations to reduce our
overall debt levels."

ON Semiconductor Corp. -- http://www.onsemi.com/-- supplies power
solutions to engineers, purchasing professionals, distributors and
contract manufacturers in the computer, cell phone, portable
devices, automotive and industrial markets.

As of December, 2005, the Company's equity deficit narrowed to
$300.3 million from a $537 million deficit at December 31, 2004.


OWENS CORNING: Court Sets April 5 Disclosure Statement Hearing
--------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware will hold a hearing on April 5, 2006,
at 9:00 a.m., to consider approval of the Disclosure Statement
explaining the Fifth Amended Joint Plan of Reorganization of Owens
Corning and its debtor-affiliates.

At the Disclosure Statement Hearing, the Court will find whether
the Disclosure Statement contains adequate information pursuant
to Section 1125 of the Bankruptcy Code that would enable a
hypothetical reasonable investor typical of holders of claims or
interests of the relevant class to make an informed judgment
about the Debtors' Plan.

The Disclosure Statement Hearing may be adjourned from time to
time.  The Debtors advise parties-in-interest to refer to the
http://www.ocplan.comfor confirmation of the Disclosure  
Statement Hearing Date before attending the Hearing.

Objections, if any, to the approval of the Disclosure Statement
are due on March 15, 2006.

Responses and objections, if any, must:

   -- be in writing;

   -- state the name and address of the objecting or responding
      party and the nature of the claim or interest of the party;

   -- state with particularity the nature of any objection or
      response and its legal basis, and include, where
      appropriate, proposed language to be inserted in the
      Disclosure Statement to resolve the objection or response;
      and

   -- be served on these parties:

         * co-counsel to the Debtors:

              Saul Ewing LLP
              222 Delaware Avenue
              P.O. Box 1266
              Wilmington, DE 19899
              Attn: Norman L. Pernick, Esq.;

              Saul Ewing LLP
              Lockwood Place
              500 E. Pratt Street
              Baltimore, MD 21202-3171
              Attn: Jay A. Shulman, Esq.; and

              Sidley Austin LLP
              One South Dearborn Street
              Chicago, IL 60603
              Attn: Larry J. Nyhan, Esq.
                    James F. Conlan, Esq. and       
                    Jeffrey C. Steen, Esq.;

         * counsel to the Official Committee of Asbestos
           Creditors:

              Caplin & Drysdale, Chartered
              375 Park Avenue, 35th Floor
              New York, NY 10152-3500
              Attn: Elihu Inselbuch, Esq.;

              Campbell & Levine, LLC
              800 King Street, Suite 300
              Wilmington, DE 19801
              Attn: Marla Eskin, Esq.;

         * counsel to James J. McMonagle, Legal Representative
           for Future Claimants:

              Kaye Scholer LLP
              425 Park Avenue
              New York, NY 10022
              Attn: Edmund M. Emrich, Esq.; and

              Young, Conaway, Stargatt & Taylor, LLP
              The Brandywine Building
              1000 West Street, 17th Floor
              P.O. Box 391
              Wilmington, DE 19899-0391
              Attn: James L. Patton, Esq.; and

         * Office of the United States Trustee
           J. Caleb Boggs Federal Building
           844 King Street, 2nd Floor
           Wilmington, DE 19801
           Attn: David M. Klauder, Esq.

The Debtors disclose that some provisions of the Disclosure
Statement are subject to ongoing review or revision.  The Debtors
accordingly reserve the right to modify or supplement the
Disclosure Statement at any time prior to the Hearing.

Owens Corning -- http://www.owenscorning.com/-- manufactures
fiberglass insulation, roofing materials, vinyl windows and
siding, patio doors, rain gutters and downspouts.  Headquartered
in Toledo, Ohio, the Company filed for chapter 11 protection on
October 5, 2000 (Bankr. Del. Case. No. 00-03837).  Mark S. Chehi,
Esq., at Skadden, Arps, Slate, Meagher & Flom, represents the
Debtors in their restructuring efforts.  (Owens Corning Bankruptcy
News, Issue No. 125; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


PANOLAM INDUSTRIES: Nevamar Acquisition Cues S&P to Affirm Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on Shelton, Connecticut-based
Panolam Industries International Inc. in connection with Panolam's
pending acquisition of decorative laminate competitor, Nevamar
Holdco LLC, for $80 million including assumed debt.  The outlook
is stable.
     
At the same time, Standard & Poor's affirmed its 'B+' senior
secured bank loan rating and '1' recovery rating on Panolam's bank
facility, which will increase:

   * by $80 million to finance the acquisition; and
   * by $10 million to increase the revolving credit facility.

The bank facility will comprise a $30 million revolving credit
facility due 2010 and a $215 million first-lien term loan due
2012.  The bank loan rating and recovery rating indicate the
expectation of full recovery of principal in the event of a
payment default.  Standard & Poor's based its ratings on
preliminary terms and conditions, and the ratings are subject to
review once the rating agency receives final documentation.
     
"The affirmation reflects our belief that the Nevamar acquisition
solidifies Panolam's position as one of the largest producers of
decorative overlay products, primarily thermally fused melamine
panels and high-pressure laminates, and will expand Panolam's
distribution network and customer base," said Standard & Poor's
credit analyst Lisa Wright.  "The acquisition will increase
Panolam's debt leverage and decrease operating margins, although
the combined company should benefit from opportunities for
synergies through product and facility rationalization as well as
reduced corporate overhead."
     
Panolam's financial policy is very aggressive, and Standard &
Poor's expects the company to remain highly leveraged.  Total
debt, including capitalized operating leases, will be
approximately $370 million at closing.
     
A leading market position and a competitive cost structure should
sustain credit measures within a range appropriate for the current
ratings, even during cyclical downturns and periods of rising raw-
material costs.
     
"We could revise the outlook to negative if Panolam experiences
rising raw-material or energy costs that it can not offset with
price increases or operating efficiencies, resulting in
meaningfully constrained earnings and cash flow, or if expenses
related to the plant-expansion program, higher-than-expected
restructuring costs, or other integration issues constrain
liquidity," Ms. Wright said.  "We could revise the outlook to
positive if leverage improves toward the 4x area and Panolam
sustains free cash flow above $20 million."


PARMALAT USA: Preliminary Injunction Stretched to March 31
----------------------------------------------------------
Arab Banking Corporation (B.S.C.) asked the U.S. Bankruptcy Court
for the Southern District of New York to either:

   a. make an inquiry and terminate the preliminary injunction;
      or

   b. extend the injunction on the condition that Parmalat
      cooperates in fact discovery in the U.S. so that ABC and
      other aggrieved creditors may develop evidence regarding
      the fairness of the Italian claims process.

ABC is a holder of three promissory notes issued by Wishaw Trading
S.A. and guaranteed by Parmalat SpA valued at $9,000,000 in
principal and interest as of the Petition Date:

   1. No. ECO-WU-2808, dated February 4, 2002
   2. No. ECO-WU-2914, dated March 5, 2002
   3. No. ECO-WU-3601, dated July 31, 2003

According to James W. Giddens, Esq., at Hughes Hubbard & Reed
LLP, in New York, Parmalat on August 10, 2004, inexplicably
excluded ABC's claim arising from the Notes and Guaranties from
the Debtors' published list of creditors.  Dr. Enrico Bondi, as
extraordinary administrator of Parmalat and certain of its
affiliates, also objected to the Claim, arguing that there were
documentary deficiencies and a legal technicality rendered the
Guaranties revocable under Italian law.

In January 2005, ABC asked the Italian Court to admit the Claim
over Dr. Bondi's objection.  ABC argued that Dr. Bondi's
objection is meritless because, among others:

   -- Italian case law holds that a lack of a certain date at law
      is not an obstacle for allowance of a claim in a bankruptcy
      proceeding;

   -- Parmalat CEO Calisto Tanzi executed the Guaranties,
      supported by later legal opinions, prior to the Petition
      Date; and

   -- the hypothetical revocability of the Guaranties does not
      apply to ABC, a bona fide third-party purchaser.

Over the course of litigation, Mr. Giddens relates, Parmalat has
never denied the Guaranties.  In fact, Mr. Giddens says, the
Guaranties were on Parmalat's books and records.  Parmalat also
did not question that ABC is a bona fide purchaser of the Notes
and Guaranties.

ABC expects that protracted litigation before the Italian Court
could continue for many years.

Mr. Giddens contends that Parmalat has proffered whimsical
factual assertions supported by erroneous legal interpretations
in denying admission to ABC's Claim in the Italian proceedings.  
However, Mr. Giddens points out, Parmalat is allowing nearly
identical Notes and Guaranties held by other entities.

While the other entities have received or soon will receive
distributions of new Parmalat stock, Mr. Giddens notes that ABC
is left to expend legal fees and time in a protracted litigation
over a claim that Parmalat recognizes on its own books.

In seeking an extension of the Preliminary Injunction Order,
Parmalat must demonstrate that claimholders in the Italian
proceedings are receiving "just treatment" and not experiencing
"prejudice and inconvenience" in the claims administration
process, Mr. Giddens insists.  Parmalat has failed to meet this
burden to ABC, he says.

Parmalat, Mr. Giddens maintains, should not be granted relief in
the United States while ABC faces delay and discrimination
without foundation in the Italian Proceedings.

               Court Extends Preliminary Injunction

Judge Drain enjoins and restrains, on an interim basis, all
persons subject to the jurisdiction of the U.S. court from
commencing or continuing any action to collect a prepetition debt
against Parmalat SpA and its affiliates and subsidiaries, and the
successor of the Foreign Debtors pursuant to the Composition with
Creditors, without obtaining permission from the Bankruptcy
Court.

The Preliminary Injunction Order will remain in effect through
and including March 31, 2006.  

Certain noteholders holding EUR632,559,971 in allowed claims have
withdrawn, without prejudice, their objection to the further
continuation of the Preliminary Injunction Order.  The Foreign
Debtors and the Noteholders have reached an agreement in
principle regarding the resolution of litigation before the Parma
Court in Italy relating to the Noteholders' claims arising under
certain debt obligations of the Foreign Debtors.

The Noteholders consented to a further extension of the
Preliminary Injunction Order so that the Order will remain in
full force and effect while the resolution of the claims
litigation relating to the Noteholders' Notes is effectuated in
the Foreign Debtors' Italian bankruptcy cases.

Arab Banking Corporation also agreed to continue the hearing to
consider its objection at a later date.

Judge Drain will convene a hearing on March 29, 2006, at 10:00
a.m. to consider whether to continue the terms of the Preliminary
Injunction.  Any objection to the continuation of the Injunction
must be filed and served on the counsel for the Foreign Debtors
by March 22, 2006, at 4:00 p.m.

A schedule of the Noteholders and their claims against the
Foreign Debtors is available at no charge at
http://ResearchArchives.com/t/s?544

Headquartered in Wallington, New Jersey, Parmalat USA Corporation
-- http://www.parmalatusa.com/-- generates more than 7 billion
euros in annual revenue.  The Parmalat Group's 40-some brand
product line includes milk, yogurt, cheese, butter, cakes and
cookies, breads, pizza, snack foods and vegetable sauces, soups
and juices and employs over 36,000 workers in 139 plants located
in 31 countries on six continents.  The Company filed for chapter
11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No.
04-11139).  Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at
Weil Gotshal & Manges LLP, represent the Debtors.  When the U.S.
Debtors filed for bankruptcy protection, they reported more than
$200 million in assets and debts.  The U.S. Debtors emerged from
bankruptcy on April 13, 2005.  (Parmalat Bankruptcy News, Issue
No. 69; Bankruptcy Creditors' Service, Inc., 215/945-7000)


PATHMARK STORES: Awards Kenneth Martindale Restricted Common Stock
------------------------------------------------------------------
As previously reported, Kenneth Martindale joined Pathmark Stores,
Inc. (Nasdaq: PTMK) as a Co-President and Chief Merchandising and
Marketing Officer, effective Jan. 1, 2006.  On Jan. 1, 2006,
pursuant to award agreements dated Dec. 14, 2005, Pathmark granted
Mr. Martindale an option to purchase an aggregate of 500,000
shares of Pathmark common stock at an exercise price of $9.99 per
share (the closing price of Pathmark common stock on the last
business day before the Effective Date), and an award of
restricted stock consisting of 200,000 restricted shares of
Pathmark's common stock.

The option will vest and become exercisable in three annual
installments beginning on the first anniversary of the Effective
Date, and the restricted stock will vest in twelve quarterly
installments beginning on March 31, 2006 and each June 30th,
September 30th, December 31st and March 31st thereafter, until the
award shares are fully vested.

Pathmark Stores, Inc. -- http://www/pathmark.com/-- is a regional   
supermarket currently operating 142 supermarkets primarily in the
New York - New Jersey and Philadelphia metropolitan areas.  The
Company filed for chapter 11 protection on July 12, 2000 (Bankr.
Case 00-02963).  The Court confirmed its prepackaged Plan of
Reorganization on Sept. 7, 2004.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 21, 2005,
Standard & Poor's Ratings Services lowered its ratings on Pathmark
Stores Inc. to 'B-' from 'B'.  The rating outlook is negative.

"The downgrade reflects Pathmark's weakening credit metrics,
limited cash flow generation, and our view that it will be very
challenging for the company to significantly improve its market
share and profitability levels given the competitive supermarket
environment in which it operates," said Standard & Poor's credit
analyst Stella Kapur.


PENNSYLVANIA REAL: Acquires Springhills Property for $21.5 Million
------------------------------------------------------------------
Pennsylvania Real Estate Investment Trust (NYSE:PEI) completed the
acquisition of approximately 540 acres of land parcels known as
Springhills in Gainesville, Florida for $21.5 million.  PREIT
funded the acquisition from its unsecured credit facility.

The acquisition includes portions of all four quadrants of the
interchange of Interstate 75 and 39th Avenue.  It is located in
the rapidly growing northwest area of Gainesville, Florida, the
commercial center for North Central Florida's 12 counties.  
Located within an eight mile radius of Springhills are the major
employers in Alachua County, such as The University of Florida
(12,200 employees and 48,000 students), Shands Hospital (7,500
employees), and Alachua County School Board (4,200 employees).

Springhills initially received approvals in 1998.  Since 2001,
when PREIT entered into a contract to purchase the property, the
Company has worked with Alachua County officials to amend the
approved development program to authorize a more comprehensive
mixed-use development plan.

In January, the Alachua County Commission voted to transmit
program amendments to the Florida Department of Community Affairs
as part of the Department's review of Developments of Regional
Impact.

During 2006, Alachua County and the Florida Department of
Community Affairs are expected to prepare authorizations to allow
for the development of up to:

     * 2,200 single and multi-family housing units;

     * 1,480,000 square feet of retail/commercial development;

     * 182,000 square feet of office/institutional facilities;

     * 300 hotel rooms; and

     * 440,000 square feet of industrial space.

Permitting, designing, and leasing are expected to occur during
2006 and 2007, with initial occupancies expected in 2008 and 2009.

"We are pleased to have reached this milestone with Alachua County
and look forward to finalizing the development program and moving
ahead with the creation of Springhillls in Gainesville," Doug
Grayson, Executive Vice President, Development said.

Headquartered in Philadelphia, Pennsylvania, Pennsylvania Real
Estate Investment Trust -- http://www.preit.com/-- has a primary
investment focus on retail shopping malls and power centers
(approximately 34.5 million square feet) located in the eastern
United States.  Founded in 1960 and one of the first equity REITs
in the U.S., PREIT's portfolio currently consists of 52 properties
in 13 states, including 39 shopping malls, 12 strip and power
centers and one office property.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 18, 2005,
Fitch Ratings has affirmed the preferred stock rating of 'B+' on
Pennsylvania Real Estate Investment Trust.  Fitch has also
established an issuer rating of 'BB' for P-REIT and revises its
Outlook to Positive from Stable.


PHASE III: Completes $1 Million Funding to Aid Purchase of NeoStem
------------------------------------------------------------------
Phase III Medical, Inc. (OTCBB:PHSM) completed two separate
financings of $500,000 each.  The money was raised to help
complete Phase III's acquisition of NeoStem, an adult stem cell
company, reported on Jan. 26, 2006, and to facilitate the new
company's development of its adult stem cell collection,
processing and storage business.

On Nov. 28, 2005, Phase III sold to an accredited investor,
Caribbean Stem Cell Group, Inc., 6,250,000 shares of common stock
and short term warrants for a total of $500,000.

On Jan. 31, 2006, the Company closed upon the final of three
tranches of Units to accredited investors consisting of
convertible promissory notes and detachable warrants.  Gross
proceeds raised were $500,000.

Each Unit was composed of:

   (a) a nine-month note in the principal amount of $25,000
       bearing 9% simple interest, payable semi-annually, with
       the second payment paid upon maturity, convertible into
       shares of the Company's common stock at a conversion
       price of $.06 per share; and

   (b) 416,666 detachable three-year warrants, each for the
       purchase of one share of common stock at an exercise price
       of $.12 per share.

The Company also completed during November 2005 through January
2006, the exchange of $510,000 of outstanding promissory notes for
8,670,000 shares of common stock and repaid promissory notes
aggregating $73,000 for a total debt reduction of $583,000.

The Company paid to WestPark Capital, Inc., the placement agent
for the Units:

   (a) cash equal to 10% of the aggregate principal amount of the
       promissory notes sold ($50,000);

   (b) 500,000 shares of common stock; and

   (c) a warrant to purchase 833,332 shares of the Company's
       common stock.

WestPark was also reimbursed for certain expenses.

"We are extremely pleased that investors share our enthusiasm
about the growth potential of our new company, which is a pioneer
in collecting, processing and storing adult stem cells that donors
can access for their own medical treatment," Mark Weinreb,
President and CEO of Phase III Medical, Inc., said.  "These funds
were timely so that we could effectively complete the NeoStem
transaction and prepare the Company for activities after the
acquisition."

Currently, a marketing and operational plan is being developed to
integrate both companies, and a corporate awareness campaign is
being prepared," Mr. Weinreb added.  "We are hopeful that this
company will become the leading provider of adult stem cells for
therapeutic use in the burgeoning field of regenerative medicine
for heart disease, types of cancer and other critical health
problems."

None of the shares of common stock, short term warrants, Units and
the convertible promissory notes and detachable warrant comprising
the Units were registered under the Securities Act of 1933, as
amended, and such securities were exempt from registration
pursuant to Section 4(2) of the Securities Act of 1933, as amended
and Rule 506 of Regulation D promulgated.  The securities that
were sold may not be offered or sold in the United States unless
they are registered under the federal securities laws or subject
to an applicable exemption from registration.  The shares of
common stock that were issued in exchange for outstanding
promissory notes were not registered under the Securities Act of
1933, as amended and were exempt from registration. These shares
of common stock may not be offered or sold in the United States
unless they are subject to an applicable exemption from
registration.

                   About Phase III Medical. Inc.

Phase III Medical, Inc. (OTCBB:PHSM), a Delaware corporation, is
an innovative, publicly traded company that, through the
acquisition of NeoStem, is positioned to become a leader in the
adult stem cell field and to capitalize on the increasing
importance the Company believes adult stem cells will play in the
future of regenerative medicine.  The management and board of
directors and advisors of Phase III have collective experience in
life science marketing, business management, and financial
expertise, as well as significant technical, medical and
scientific experience.

At Sept. 30, 2005, Phase III Medical Inc.'s balance sheet showed a
stockholders' deficit of $2.5 million, compared to $1.9 million
deficit at Dec. 31, 2004.


PEP BOYS: S&P Places B- Corporate Credit Rating on Watch
--------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Pep Boys-
Manny, Moe & Jack, including its 'B-' corporate credit rating, on
CreditWatch with developing implications.  This action follows the
company's announcement that it has hired Goldman, Sachs & Co. to
explore strategic and financial alternatives.  Standard & Poor's
will monitor developments associated with this process to assess
the implications for the ratings.


PERFORMANCE TRANSPORTATION: U.S. Trustee Forms Creditors Committee
------------------------------------------------------------------
Pursuant to Section 1102 of the Bankruptcy Code, Deirdre A.
Martini, the United States Trustee for Region 2, appoints three
parties to the Official Committee of Unsecured Creditors in
Performance Transportation Services, Inc. and its 13 debtor-  
affiliates' Chapter 11 cases.   

The Creditors Committee consists of:

     (1) Robert Coco
         Central States Southeast & Southwest
         Areas Pension and Health and Welfare Funds
         Central States Law Department
         9377 West Higgins Road
         Rosemont, IL 60018

     (2) James McLearen
         McLearen's JJJ Interprise Inc.
         19300 Middlebelt Road
         Romulus, MI 48174

     (3) Eric J. Mikesell
         United Road Services Inc.
         10701 Middlebelt Road
         Romulus, MI 48174

Headquartered in Wayne, Michigan, Performance Transportation
Services, Inc. -- http://www.pts-inc.biz/-- is the second largest     
transporter of new automobiles, sport-utility vehicles and light
trucks in North America.  The Company provides transit stability,
cargo damage elimination and proactive customer relations that are
second to none in the finished vehicle market segment.  The
company's chapter 11 case is administered jointly under Leaseway
Motorcar Transport Company.

Headquartered in Niagara Falls, New York, Leaseway Motorcar
Transport Company Debtor and 13 affiliates filed for chapter 11
protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Case No. 06-00107).
Garry M. Graber, Esq., at Hodgson Russ LLP represent the Debtors
in their restructuring efforts.  When the Debtors filed for
protection from their creditors, they estimated assets between $10
million and $50 million and more than $100 million in debts.
(Performance Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


PHLO CORP: Posts $904,494 Net Loss in Quarter Ended December 31
---------------------------------------------------------------
Phlo Corporation delivered its quarterly report on Form 10-QSB
for the quarter ended Dec. 31, 2005, to the Securities and
Exchange Commission on Feb. 9, 2006.

The Company reported a $904,494 net loss on $722 of net revenues
for the quarter ended Dec. 31, 2005.  At Dec. 31, 2005, the
Company's balance sheet showed $187,447 in total assets and
liabilities of $4,943,221, resulting in a $4,755,774 stockholders'
deficit.  The Company had an accumulated deficit of $19,738,480 at
Dec. 31, 2005.

                     Going Concern Doubt

Russell Bedford Stefanou Mirchandani LLP expressed substantial
doubt about Phlo Corporation's ability to continue as a going
concern after it audited the Company's financial statements for
the fiscal year ended March 31, 2005.  The auditing firm pointed
the Company's recurring losses from operations and inability to
generate sufficient cash flow to sustain its operations.

A full-text copy of the regulatory filing is available at no
charge at http://researcharchives.com/t/s?543

                 About Phlo Corporation

Based in Jacksonville, Florida, Phlo Corporation is a
biotechnology company and a manufacturer and marketer of products
containing patented and patents-pending biotechnologies which are
sold on a commercial basis to governmental and institutional
purchasers and to high volume chain stores, such as supermarkets
and drug and convenience stores.  Phlo is focusing its technology
generation and acquisition efforts on those technologies related
to enhancing cognition and personal performance, reducing the
effects of aging, and preventing or ameliorating cancer.


ROGERS COMMS: Posts $66.7 Million Net Loss in Fourth Quarter 2005
-----------------------------------------------------------------
Rogers Communications Inc. reported its financial results for
fourth quarter and full year ended Dec. 31, 2005.

Rogers Communications Inc. reports a $66,713,000 net loss on
$2,120,162,000 of sales for the three months ended Dec. 31, 2005.  
The company also reports a full year net loss $44,658,000 on
$7,482,154,000 of sales for the 12 months ended Dec. 31, 2005.

                            Operations

For three months ended Dec. 31, 2005, cash generated from
operations before changes in non-cash operating items,
increased to $379.8 million from $316.5 million in the
corresponding period in 2004.  The $63.3 million increase is
primarily the result of the increase in operating profit of
$63.0 million partially offset primarily by period over period
changes in other income.

Taking into account the changes in non-cash working capital items
in the three months ended Dec. 31, 2005, cash generated from
operations was $287.0 million, compared to $452.2 million in the
corresponding period of 2004.

The cash flow generated from operations of $287.0 million,
together with the following items, resulted in total net funds of
approximately $387.6 million raised in the three-month period
ended Dec. 31, 2005:

   -- aggregate net draw downs of $82.0 million under bank credit
      facilities;

   -- receipt of $17.1 million from the issuance of Class B
      Non-Voting shares under the exercise of employee stock
      options; and

   -- receipt of $1.5 million mainly from the sale of
      miscellaneous investments.

Net funds used during the three-month period ended Dec. 31, 2005,
totaled approximately $593.8 million, which include:

   -- additions to PP&E of $436.9 million, including the
      $6.9 million of related changes in non-cash working capital;

   -- $140.9 million for the redemption of $113.7 million of
      Cable's 11% Senior Subordinated Guaranteed Debentures,
      including $7.3 million (5.50%) redemption premium;

   -- $12.9 million to fund the remainder owing for the exercise
      of call rights for warrants issued by Fido which was related
      to the acquisitions of Fido;

   -- $2.0 million related to other acquisitions; and

   -- $1.1 million repayment of mortgages and leases.

                            Financing

In October 2005, after the issuance to Microsoft Corporation
of the company's intention to redeem the $600 million aggregate
principal amount of 51/2% Convertible Preferred Securities due
August 2009, the company received notice that Microsoft had
elected to convert these securities.  The company issued
17,142,857 Class B Non-Voting shares to Microsoft on Oct. 24,
2005, at the exercise price of $35 per share.

In December 2005, Cable redeemed all of the outstanding
$113.7 million aggregate principal amount of its 11% Senior
Subordinated Guaranteed Debentures due 2015 at a redemption
premium of 5.50% for a total of $140.9 million (US$119.9 million).

Rogers Communications Inc. (TSX: RCI; NYSE: RG) --
http://www.rogers.com/-- is a diversified Canadian communications        
and media company engaged in three primary lines of business.
Rogers Wireless Inc. is Canada's largest wireless voice and data
communications services provider and the country's only carrier
operating on the world standard GSM/GPRS technology platform;
Rogers Cable Inc. is Canada's largest cable television provider
offering cable television, high-speed Internet access, voice-over-
cable telephony services and video retailing; and Rogers Media
Inc. is Canada's premier collection of category leading media
assets with businesses in radio and television broadcasting,
televised shopping, publishing and sports entertainment.  On
July 1, 2005, Rogers completed the acquisition of Call-Net
Enterprises Inc. (now Rogers Telecom Holdings Inc.), a national
provider of voice and data communications services.

                            *   *   *

As previously reported in the Troubled Company Reporter on
Oct. 31, 2005, Standard & Poor's Ratings Services revised its
outlook to positive from stable on Rogers Communications Inc.,
Rogers Wireless Inc., and Rogers Cable Inc.  At the same time,
Standard & Poor's affirmed the 'BB' long-term corporate credit
rating on each of RCI, RWI, and Rogers Cable.

As previously reported in the Troubled Company Reporter on
Nov. 2, 2005, Moody's Investors Service placed all long term
ratings of Rogers Communications Inc., Rogers Cable Inc., and
Rogers Wireless Inc. under review for possible upgrade.  The
corporate family rating of Rogers Telecom Holdings Inc. is
withdrawn, as it is now part of the RCI family of companies, and
the senior secured rating of Telecom remains under review for
possible upgrade.

Debt ratings affected by this action:

                    Rogers Communications Inc.
                    --------------------------

Corporate Family Rating, Ba3

Senior Unsecured, rated B3:

    * Notes 10.5% due February 2006 C$75 million


                         Rogers Cable Inc.
                         -----------------

Senior Secured, rated Ba3:

Second Priority Notes

    * 7.60% due February 2007 C$450 million
    * 7.25% due December 2011 C$175 million
    * 7.875% due May 2012 $350 million
    * 6.25% due June 2013 $350 million
    * 5.50% due March 2014 $350 million
    * 6.75% due March 2015 $280 million

Second Priority Debentures

    * 8.75% due May 2032 $200 million


Senior Subordinated, rated B2:

    * Gteed Debentures 11% due December 2015 $114 million


                       Rogers Wireless Inc.
                       --------------------

Senior Secured Notes, rated Ba3

    * 10.5% due June 2006 C$160 million

Floating rate, due December 2010 $550 million

    * 9.625% due May 2011 $490 million
    * 7.625%, due December 2011 C$460 million
    * 7.25%, due November 2012 $470 million
    * 6.375%, due March 2014 $750 million
    * 7.50%, due March 2015 $550 million

Senior Secured Debentures, rated Ba3

    * 9.75% due June 2016 $155 million

Senior Subordinated Notes, rated B2:

    * 8%, due December 2012 US$400 million

                   Rogers Telecom Holdings Inc.
               (formerly Call-Net Enterprises Inc.)
               ------------------------------------

Corporate Family Rating: withdrawn

Senior Secured rating: B3

    * 10.625% Notes due December 31, 2008 (callable January 1,
      2006) $22 million


ROUGE INDUSTRIES: Has Interim Access to Lenders' Cash Collateral
----------------------------------------------------------------
The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware gave Rouge Industries, Inc., and its debtor-
affiliates interim access to cash collateral securing repayment of
their prepetition debts to Philip Environmental Services
Corporation and Duke/Fluor Daniel.  

The Bankruptcy Court has entered eleven prior orders allowing the
Debtors to use their creditors' cash collateral.  The Debtors are
authorized to use PESC and Duke/Fluor's cash collateral until
Feb. 28, 2006, in accordance with a monthly budget, a copy of
which is available for free at http://researcharchives.com/t/s?548

Use of the cash collateral will enable the Debtors to continue the
administration of their estates, wind down their remaining
businesses and operations, and liquidate their remaining assets
and properties.

To provide the prepetition lenders with adequate protection, the
Debtors will grant replacement liens and security interests to the
extent of any diminution in value of their collateral.

The Bankruptcy Court will convene a hearing to consider final
approval of the Debtors' request to use cash collateral is
scheduled at 2:00 p.m. on Feb. 23, 2006.

Headquartered in Dearborn, Michigan, Rouge Industries, Inc., an
integrated producer of flat-rolled steel, filed for chapter 11
protection on October 23, 2003 (Bankr. D. Del. Case No. 03-13272).
Donna L. Harris, Esq., Robert J. Dehney, Esq., Eric D. Schwartz,
Esq., Gregory W. Werkheiser, Esq., and Alicia B. Davis, Esq., at
Morris, Nichols, Arsht & Tunnell represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed $558,131,000 in total assets and
$558,131,000 in total debts.  On Dec. 19, 2003, the Court approved
the sale of substantially all of the Debtors' assets to Severstal
N.A. for $285.5 million.  The Asset Sale closed on Jan. 30, 2005.


SAINT VINCENTS: Clarifies Coverage of Malpractice Claims Protocol
-----------------------------------------------------------------
Andrew M. Troop, Esq., at Weil, Gotshal & Manges LLP, in New
York, relates that through discussions with interested parties,
the form of Stipulation for each of Category One and Two, related
to a protocol implemented to resolve malpractice claims, has been
modified slightly to clarify Saint Vincents Catholic Medical
Centers of New York and its debtor-affiliates' intent that the
Stipulations cover:

   (a) the Debtors' current or former employees who are not
       separately insured from the Debtors, where the Debtors
       maintain third party primary malpractice insurance; and

   (b) employees who are not separately insured and rely or have
       relied on indemnification or similar rights from the
       Debtors where the Debtors do not maintain third party
       primary insurance.

Mr. Troop informs the U.S. Bankruptcy Court for the Southern
District of New York that since the Debtors began to implement
their "three category" approach to requests for relief from stay
to pursue medical malpractice claims, they have been able to enter
into Stipulations with a number of potential claimants, where
commercial insurance is paying the Debtors' defense costs in
connection with the asserted malpractice claim.

To the extent Stipulations have not been entered, the Debtors are
not aware definitively that the potential claimants are unwilling
to do so.  Those claimants have not contacted the Debtors, Mr.
Troop states.  Moreover, efforts to conclude Stipulations are
still ongoing.

Where commercial insurance to pay defense costs is not available,
no claimant has pursued a relief from stay motion.  Instead,
those claimants seem to be awaiting the implementation of the
compulsory mediation process, Mr. Troop tells the Court.

Mr. Troop contends that it would be efficient for the Court, the
Debtors, and other claimants asserting malpractice claims to
establish a protocol that provides that:

   (i) parties filing motions for relief from stay to pursue a
       medical malpractice claim have the opportunity to evaluate
       the Stipulations, if they choose;

  (ii) parties filing stay relief motions have the opportunity to
       enter into the appropriate Stipulation with the Debtors
       without requiring the Debtors to respond to their stay
       relief motions;

(iii) the Prospective Claimants schedule a hearing on their
       Prospective Motions; and

  (iv) the Court enter further orders for each Prospective
       Motion to permit Prospective Claimants and the Debtors to
       conclude a Stipulation.

Hearings should be scheduled on Prospective Motions only where the
Debtors and the Prospective Claimants are unable to agree on a
Stipulation, Mr. Troop asserts.

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the   
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, filed the Debtors' chapter 11 cases.  On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.  
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors.  As of Apr. 30, 2005,
the Debtors listed $972 million in total assets and $1 billion in
total debts.  (Saint Vincent Bankruptcy News, Issue No. 20;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


SALOMON BROTHERS: Projected Losses Cue Moody's to Review Rating
---------------------------------------------------------------
Moody's Investors Service placed on review for possible downgrade
one certificate from one transaction, issued by Salomon Brothers
Mortgage Securities VII, Inc., Mortgage Pass-Through Certificates
in 2001.  The certificates are secured by seasoned reperforming
loans.

The M-5 subordinate certificate is placed under review for
possible downgrade because existing credit enhancement levels may
be low given the current projected losses on the underlying pool.
The collateral has taken losses causing gradual erosion of the
overcollateralization and the unrated M-6 class.  As of the
January payment date there was less than $100,000 of protection in
the form of overcollateralization and an unrated tranche below the
M-5 class.

Moody's complete rating action:

   Issuer: Salomon Brothers Mortgage Securities VII, Inc.,
           Mortgage Pass-Through Certificates

   Review for Possible Downgrade:

      * Series 2001-2; Class M-5, current rating B2, under review
        for possible downgrade


SAVVIS INC: Dec. 31 Balance Sheet Upside-Down by $132 Million
-------------------------------------------------------------
SAVVIS, Inc.'s (NASDAQ:SVVS) revenue for the fourth quarter of
2005 totaled $171.5 million, compared to $166.3 million in the
fourth quarter of 2004 and $166.1 million in the third quarter of
2005.  SAVVIS' consolidated net loss narrowed to $13.1 million,
compared to a loss of $21.7 million in the fourth quarter of 2004
and a loss of $13.7 million in the third quarter of 2005.

For the full year, revenue of $667.0 million was up 8% from
$616.8 million in 2004.  Consolidated net loss was $69.1 million,
an improvement of $79.7 million compared to a consolidated net
loss of $148.8 million in 2004.

"The SAVVIS team delivered impressive results in 2005, with strong
Adjusted EBITDA and cash generation as well as effective cost
management and increased sales bookings," Acting Chief Executive
Officer Jack Finlayson, said.  "Fourth-quarter revenue of
$171.5 million reflects the excellent sales results of 2005 --
strong market acceptance of SAVVIS' products, from our innovative
virtualized utility services to traditional colocation hosting,
resulted in record sales bookings.  The fourth-quarter revenue was
driven by strong growth in our core Managed IP VPN and Hosting
services, up 22% and 19% from a year ago.

For the full-year 2005, cash flow from operations was
$62.8 million, an improvement of $89.6 million from cash
used in operations of $26.8 million in 2004.

For the full year 2005, cash capital expenditures totaled
$56.4 million.

At Dec. 31, 2005, the Company's total assets were $409.6 million
and total liabilities were $541.6 million, resulting in a
stockholders' deficit of $132 million.

Headquartered in Town & Country, Missouri, SAVVIS, Inc. --
http://www.savvis.net/-- is a global provider of managed and  
outsourced IT services that focuses exclusively on IT solutions
for businesses.  With an IT services platform that extends to 47
countries, SAVVIS has over 5,000 enterprise customers and leads
the industry in delivering secure, reliable, and scalable hosting,
network, and application services.  These solutions enable
customers to focus on their core business while SAVVIS ensures the
quality of their IT systems and operations.  SAVVIS' strategic
approach combines virtualization technology, a global network and
25 data centers, and automated management and provisioning
systems.


SCHOONER TRUST: Moody's Rates CDN$2.4 Million Certs. at (P)B3
-------------------------------------------------------------
Moody's Investors Service has assigned the following provisional
ratings to certificates issued by Schooner Trust Commercial
Mortgage Pass-Through Certificates, Series 2006-5:

   * (P) Aaa to the CDN$192.6 million Class A-1 Certificates due
     February 2021,

   * (P) Aaa to the CDN$241.0 million Class A-2 Certificates due
     February 2021,

   * (P) Aa2 to the CDN$9.2 million Class B Certificates due
     February 2021,

   * (P) A2 to the CDN$10.3 million Class C Certificates due
     February 2021,

   * (P) Baa2 to the CDN$13.4 million Class D Certificates due
     February 2021,

   * (P) Baa3 to the CDN$3.0 million Class E Certificates due
     February 2021,

   * (P) Ba1 to the CDN$3.6 million Class F Certificates due
     February 2021,

   * (P) Ba2 to the CDN$1.8 million Class G Certificates due
     February 2021,

   * (P) Ba3 to the CDN$1.2 million Class H Certificates due
     February 2021,

   * (P) B1 to the CDN$1.2 million Class J Certificates due
     February 2021,

   * (P) B2 to the CDN$1.2 million Class K Certificates due
     February 2021,

   * (P) B3 to the CDN$2.4 million Class L Certificates due
     February 2021,

   * (P) Aaa to the CDN$485.6* million Class XP Certificates due
     February 2021, and

   * (P) Aaa to the CDN$1.0 million Class XC Certificates due
     February 2021.

The ratings on the Certificates are based on the quality of the
underlying collateral -- a pool of multifamily and commercial
loans located in Canada.  The ratings on the Certificates are also
based on the credit enhancement furnished by the subordinate
tranches and on the structural and legal integrity of the
transaction.

The pool's strengths include its high percentage of less risky
asset classes, recourse on 65.1% of the pool, and the creditor
friendly legal environment in Canada.  Moody's concerns include
the geographic concentration of the pool, where 61.1% of the pool
balance is secured by properties located in Ontario, and the
ability of 23.3% of the pool balance to incure future subordinate
debt.  Moody's beginning loan-to-value ratio was 86.7% on a
weighted average basis.


SECURUS TECHS: S&P Affirms B+ Corp. Credit & Sr. Sec. Debt Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit and senior secured debt ratings on Dallas, Texas-based
Securus Technologies Inc.  The ratings were removed from
CreditWatch, where they were placed with negative implications on
Feb. 1, 2006, following the company's announcement that it had
received a notice from AT&T Operations Inc. (AT&T/SBC) indicating
its intentions to terminate its billing and collections agreement
and the associated services, prompted by concerns that a recent
legal settlement by Securus may be viewed as admission of
wrongdoing.
      
"The ratings affirmation reflects Securus' announcement that
AT&T/SBC has decided to withdraw its notice following extensive
discussions with the company," said Standard & Poor's credit
analyst Ben Bubeck.  

The ratings outlook is negative.
     
The ratings reflect Securus' narrow focus within a competitive and
evolving niche marketplace and its highly leveraged financial
profile.  These factors are partially offset by a largely
recurring revenue base supported by long-term customer contracts.
     
Securus is the largest independent provider of inmate
telecommunications services in the U.S.  The company provides
services to correctional facilities operated by city, county,
state, and federal authorities in the U.S. and Canada.  Securus
had approximately $220 million in operating lease-adjusted debt as
of September 2005.


SERENA SOFTWARE: Merger Cues Moody's to Junk $225MM Sr. Sub. Notes
------------------------------------------------------------------
Moody's Investors Service assigned first-time long-term ratings to
Serena Software, Inc.  Moody's also assigned a speculative grade
liquidity rating of SGL-2.  Spyglass Merger Corp., a newly formed
entity, will acquire all of the outstanding shares of Serena, a
publicly traded change management software provider that will
continue as the surviving company. Net proceeds from the $375
million senior secured term loan and $225 million senior
subordinated notes offering together with the $75 million senior
secured revolver will be used to finance Serena's $1.3 billion
buyout in a highly leveraged transaction.  The buyout, which is
subject to shareholder approval, also consists of a $349 million
cash equity investment from private equity sponsor, Silver Lake
Partners, and $154 million rollover equity from the company's
founder and board chairman, Douglas Troxel.

These first time ratings were assigned:

   * B2 Corporate Family Rating;

   * B1 rating for $75 million Senior Secured Revolving Credit
     Facility due 2012;

   * B1 rating for $375 million Senior Secured Term Loan B due
     2013;

   * Caa1 rating for $225 million Senior Subordinated Notes due
     2016;

   * SGL-2 for Speculative Grade Liquidity.

The ratings outlook is stable.

The B2 corporate family rating reflects Serena's substantial pro
forma financial leverage and thin fixed charge coverage
particularly given:

   (i) the company's small size;

  (ii) weak organic revenue growth relative to the industry;

(iii) rapid growth from the debt-financed acquisition of Merant,
       which more than doubled the company's revenues;

  (iv) Merant's brief operating and financial reporting history
       under Serena and the lack of sustained synergies from the
       combination;

   (v) execution risk tied to the build-out of the sales force;
       and

  (vi) limited asset protection from a very small base of pro
       forma tangible assets.

The ratings also consider Serena's unique cross-platform product
offering, mission-critical nature of its software resulting in
industry-leading gross margins, high revenue visibility,
consistent positive free cash flow generation from an increasing
proportion of recurring software maintenance revenue, large
installed customer base of 15,000 companies broadly diversified
across vertical markets and potential for margin expansion through
up-sell opportunities of value-added offerings into its existing
client base.

The B1 rating assigned to the senior secured term loan and
revolving credit facility is one notch higher than the corporate
family rating to reflect the senior position of the bank
facilities in the company's debt structure and the protection
provided by the collateral package.  The Caa1 rating on the senior
subordinated notes is notched two levels below the corporate
family rating to reflect the contractual subordination of the
notes to senior and secured debt, extremely low level of tangible
asset protection available and the possibility that this junior
class of creditors would not likely recover all principal due to
potential enterprise value deterioration in the event of distress.  
Moody's notes the company is being purchased at a relatively high
multiple of 13x EBITDA.

The stable outlook reflects the company's prospects for improving
financial leverage and interest coverage metrics driven by strong
pricing power, relatively stable operating cash flows even during
recessionary episodes and attractive change management industry
dynamics, offset by below average organic revenue growth, gradual
gross margin erosion, rising sales/marketing costs as a percentage
of revenues and potentially increasing competition.

Serena's addressable markets within the software change management
industry are expected to grow at a 9% CAGR through 2009 driven by
several factors including:

   (i) greater software complexity;

  (ii) increasing importance of regulatory compliance programs;

(iii) outsourcing/globalization of software design and
       development teams; and

  (iv) increasing pressures for in-house information technology
       managers to switch to more robust external solutions.

To supplement its historic low single digit organic growth,
Moody's expects Serena's long-term growth will be reliant on the
build-out of its sales team and an aggressive branding campaign to
cross-sell and up-sell higher margin products and services to the
senior stakeholders of its installed customer base.  While the
company enjoys high software maintenance renewal rates of 90% due
to the stickiness of its products, formidable rivals such as
Computer Associates and IBM pose a long-term competitive threat to
Serena's customer base.  Serena is not expected to materially
increase its investment in software research & development,
currently at 14% of LTM October 31, 2005 revenue.

The ratings could experience upward pressure to the extent that
the company is able to materially de-lever through improved free
cash flow generation resulting in debt to EBITDA under 4.5x, drive
top-line revenue growth via better cross-selling into its
installed customer base, enhance operating synergies with Merant,
and demonstrate stability in gross margins evidenced by effective
execution of up-selling more value-added capabilities. Conversely,
the ratings could migrate downward if:

   (i) the company is unable to reduce leverage due to
       alternative uses of free cash flow such as sizeable
       acquisitions or non-productive uses such as equity
       investments or dividend payments; or

  (ii) Moody's witnesses changes in the company's competitive
       position or product functionality, resulting in diminished
       pricing power, customer retention or maintenance renewals.

Additionally the ratings could be negatively influenced if the
company suffers a sustained contraction in gross and operating
margins, experiences rising financial leverage or materially
increases capital expenditures leading to negative free cash flow
generation.

The Merant acquisition has helped to grow revenue from $105.6
million in fiscal 2004 to $253.7 million pro forma in fiscal 2005.  
For the LTM 10/31/05, the company recorded $251.4 million of
revenue and $83.9 million of EBITDA compared to $40.8 million of
EBITDA in fiscal 2004.  Although Merant has been additive to cash
flow, recent organic revenue growth has been estimated in the low-
to-mid single digit range.

Pro forma for the financing, debt to EBITDA will be very high at
6.6x, debt to total capitalization will be 54%, EBITDAR to fixed
charges will be approximately 1.7x and free cash flow to debt will
be 3%.  Given the recurring nature of the maintenance contract
revenue, historic renewal rates near 90% and low capital
expenditure requirements, Moody's expects the company to generate
positive free cash flow.  Acquisition activity is expected to
consist of small tuck-in technology asset purchases and working
capital is projected to remain negligible due to the ongoing
balance of deferred revenue.

The senior secured credit facilities will be secured by
substantially all tangible and intangible assets and stock of
direct and indirect subsidiaries of the borrower and 65% of the
voting interest in foreign subsidiaries, and will be guaranteed by
the borrower's direct and indirect domestic subsidiaries. Although
the senior subordinated notes have the same guarantors as the
senior secured facilities, the guarantee is unsecured and junior
to the guarantee on the credit facilities.  Tangible asset
coverage is very minimal, with roughly $6 million of net property,
plant and equipment and $37 million of accounts receivable
compared to approximately $1.3 billion of goodwill and intangible
assets pro forma for the financing.

Serena's speculative grade liquidity rating of SGL-2 recognizes
the company's good liquidity position.  The rating is largely
based on the company's $75 million senior secured revolving credit
facility and generation of free cash flow.  Serena is expected to
maintain reasonable levels of gross cash flow to cover working
capital and capital expenditure requirements. Further supporting
the company's overall liquidity is the expectation for covenant
compliance over the next four quarters. Lastly, Serena has limited
alternative/backdoor liquidity as all of the assets are
encumbered.

Headquartered in San Mateo, California, Serena Software, Inc., is
a leading software provider focused solely on the design,
development, marketing and support of software used to manage and
control change in organizations.  For the 12 months ended Oct. 31,
2005, revenues were $251.4 million.


SERENA SOFTWARE: S&P Rates $225 Million Sr. Sub. Notes at CCC+
--------------------------------------------------------------
Standard & Poor's Rating Services assigned its 'B' corporate
credit rating to San Mateo, California-based Serena Software, Inc.
At the same time, Standard & Poor's assigned its 'B' rating and
its '2' recovery rating to the company's proposed $450 million
senior secured facility.  The senior secured facility consists of:

   * a $75 million, six-year revolving credit facility, undrawn at
     close; and

   * a seven-year, $375 million term loan.

Standard & Poor's also assigned its 'CCC+' rating to $225 million
in senior subordinated notes.
      
"The bank loan rating, which is the same as the corporate credit
rating, along with the recovery rating, reflect our expectation of
substantial (80%-100%) recovery of principal by creditors in the
event of a payment default or bankruptcy," said Standard & Poor's
credit analyst Stephanie Crane.

The outlook is stable.
     
Debt proceeds amounting to $600 million, (not including the
revolver which will be un-drawn at close) in conjunction with
existing cash and equity from the sponsor and management, will be
used to fund the acquisition of Serena, a public company, by
Silver Lake, a private equity company, for a total of $1.24
billion.
     
Serena Software provides enterprise software applications and
related services aimed at managing change in the IT environment.
The company's software products automate processes and control
changes for teams within enterprises that are managing
development, web content and IT infrastructure.  The rating on
Serena reflects the company's:

   * narrow business profile;
   * competitive market place; and
   * high leverage, around 6.9x adjusted debt to EBITDA.

These factors are partially offset by:

   * a leading position in a growing niche software market;
   * strong EBITDA margins; and
   * a significant base of recurring business.


SILICON GRAPHICS: Studying Alternatives to Avoid Bankruptcy
-----------------------------------------------------------
Silicon Graphics, Inc., disclosed in its latest Form 10-Q filed
with the Securities and Exchange Commission, that its Board of
Directors is continuing to evaluate a range of strategic
alternatives with the goal of preserving and creating value for
the benefit of stockholders and creditors.  Those alternatives
include:

    * becoming an independent public company,

    * seeking a strategic partner or acquirer,

    * seeking a financial partner to make a substantial equity
      investment, and

    * divesting additional technologies or products

The company says that if it fails to implement at least one of
these plans and, at the same time, incurs a shortfall in its
fiscal 2006 operating plan, then it could be forced to seek
protection under chapter 11 of the U.S. Bankruptcy Code.

As reported in the Troubled Company Reporter on Feb. 9, 2006, the
company reported a second quarter fiscal year 2006 net loss of
$30 million, compared with a net loss of $32 million for the
second quarter of fiscal year 2005.  The company also disclosed
that Dennis McKenna was named as the new chairman, CEO and
president, replacing Robert Bishop, who will remain as vice
chairman.

                     Restructuring Plan

As previously reported in the Troubled Company Reporter, the
company approved a restructuring plan on Aug. 30, 2005, in order
to achieve an $80 to $100 million annualized savings.  The first
step of the restructuring included cutting its workforce in North
America and certain other locations.

In addition to the headcount reductions, the restructuring plan
Also called for initiatives to reduce expenses in other areas
including procurement costs for goods and services, consolidation
and reorganization of operations in several locations,
prioritization of marketing and benefits spending and other
spending controls.

                       Credit Facility

At the end of fiscal 2005, the company reported that it did not
have enough cash to support its on-going operations and actively
sought to raise additional financing.

As reported in the Troubled Company Reporter on Oct. 27, 2005, the
company completed a new two-year asset-backed credit facility with
Wells Fargo Foothill, part of Wells Fargo & Company, and Ableco
Finance LLC.  The new facility provides for increased credit of up
to $100 million, consisting of:

    * a $50 million revolving line of credit, and
    * a $50 million term loan.

The previous facility provided availability of up to $50 million,
but was subject to a minimum cash collateral requirement of
$20 million.

On Feb. 3, 2006, borrowed the remaining $15 million against the
term loan component of its asset-backed credit facility with Wells
Fargo and Ableco.

The company says that although it was in compliance with the
covenants contained in the facility as of Dec. 30, 2005, the
company is not certain that it will be able to maintain compliance
with all of the covenants or if the additional financing will be
adequate to meet its requirements or achieve our objectives.

                    Retention of AlixPartners

During the fourth quarter of fiscal 2005, the company retained the
turnaround firm AlixPartners LLC to assist the company in
developing and implementing a restructuring program aimed at
further substantial expense reductions, revenue and margin
improvement initiatives and improved cash flow and liquidity.

Silicon Graphics, Inc. -- http://www.sgi.com/-- is a leader in
high-performance computing, visualization and storage.  SGI's
vision is to provide technology that enables the most significant
scientific and creative breakthroughs of the 21st century.
Whether it's sharing images to aid in brain surgery, finding oil
more efficiently, studying global climate, providing technologies
for homeland security and defense or enabling the transition from
analog to digital broadcasting, SGI is dedicated to addressing the
next class of challenges for scientific, engineering and creative
users.

                            *   *   *

Silicon Graphics, Inc.'s 6.5% Senior Secured Convertible Notes due
2009 carry Standard & Poor's CCC+ rating.


SUPERIOR LODGING: Case Summary & Known Creditors
------------------------------------------------
Debtor: Superior Lodging, Inc.
        617 South Broadway
        Little Rock, Arkansas 72201

Bankruptcy Case No.: 06-10461

Chapter 11 Petition Date: February 13, 2006

Court: Eastern District of Arkansas (Little Rock)

Debtor's Counsel: Basil V. Hicks, Jr., Esq.
                  Hankins & Hicks
                  P.O. Box 5670
                  North Little Rock, Arkansas 72119-5670
                  Tel: (501) 301-7700
                  Fax: (501) 301-7999

Estimated Assets: Less than $50,000

Estimated Debts:  $1 Million to $10 Million

A full-text copy of Superior Lodging's 9-page creditor matrix is
available for free at http://ResearchArchives.com/t/s?54f


T.A.T. PROPERTY: Meeting of Creditors Scheduled for February 28
---------------------------------------------------------------
The United States Trustee for Region 2 will convene a meeting of
T.A.T. Property's creditors at 3:00 p.m., on Feb. 28, 2006, at the
Office of the United States Trustee, Second Floor, 80 Broad Street
in New York City.  This is the first meeting of creditors required
under 11 U.S.C. Sec. 341(a) in all bankruptcy cases.

All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Headquartered in New York, New York, T.A.T. Property filed for
chapter 11 protection on Oct. 14, 2005 (Bankr. S.D.N.Y. Case No.
05-47223).  Barton Nachamie, Esq., at Todtman, Nachamie, Spizz &
Johns, P.C., represents the Debtor in its restructuring efforts.  
When the Debtor filed for protection from its creditors, it listed
$13,531,595 in assets and $13,522,435 in debts.


T.A.T. PROPERTY: Wants Until March 30 to File Chapter 11 Plan
-------------------------------------------------------------
T.A.T. Property asks the U.S. Bankruptcy Court for the Southern
District of New York to extend until March 30, 2006, the period
within which it has the exclusive right to file a chapter 11 plan.  
The Debtor also wants its exclusive right to solicit plan
acceptances extended through May 29, 2006.

The Debtor tells the Court that it is in the final stages of
obtaining funding to cure prepetition defaults under a mortgage
note owed to LaSalle National Bank.  The Debtor has tiny
prepetition debts other than its debt to LaSalle and its
subordinated debt to Michael Zenobio, the Debtor's principal
beneficiary and grantor.  Furthermore, the Debtor's estate has
postpetition debt other than legal fees incurred by their
bankruptcy counsel and the Reciever.

Whether the Debtor seeks a structured dismissal or files a chapter
11 plan to be paid from cash flow, the Debtor intends to pay 100
cents on the dollar to creditors on undisputed claims over time.  
The Receiver has been collecting the Debtor's rents and paying
some of the Debtor's bills.  The Debtor believes that its assets
will not be substantially depleted during the requested extension.

Accordingly, the Debtor wants an extension of its exclusive
periods to preserve its ability to formulate and negotiate a
consensual plan.

Headquartered in New York, New York, T.A.T. Property filed for
chapter 11 protection on Oct. 14, 2005 (Bankr. S.D.N.Y. Case No.
05-47223).  Barton Nachamie, Esq., at Todtman, Nachamie, Spizz &
Johns, P.C., represents the Debtor in its restructuring efforts.  
When the Debtor filed for protection from its creditors, it listed
$13,531,595 in assets and $13,522,435 in debts.


TECUMSEH PRODUCTS: Posts $55.8 Mil. Net Loss in Fourth Qtr. 2005
----------------------------------------------------------------
Tecumseh Products Company (Nasdaq: TECUA, TECUB) reported its
consolidated fourth quarter and for the full year results ended
Dec. 31, 2006.

Consolidated results for the fourth quarter of 2005 amounted to a
net loss of $55.8 million compared to a net loss of $13.2 million
in the fourth quarter of 2004.  Reported fourth quarter 2005
results included restructuring, impairment and other charges
related to the Company's Engine and Power Train Group totaling
$5.7 million.  The charges include an impairment of goodwill of
$2.7 million and a $3.0 million write-off of the Company's net
investment in its Italian engine operations.  

In addition, $1.5 million in asset impairment charges across
several segments were recognized as part of ongoing restructuring
actions, a $2.5 million intangible asset impairment was recorded
in a business not associated with any of the Company's four main
segments, and a deferred tax valuation allowance of $0.4 million  
related to the Australian operations of the Electrical Components
business was recognized.

Reported fourth quarter 2004 results included a $14.6 million
charge related to environmental costs involving the Company's New
Holstein, Wisconsin facility, restructuring and impairment charges
of $3.1 million resulting from the continuation of programs
related to the North American Compressor, Indian Compressor and
Electrical Components businesses, and a gain of $1.8 million from
the final curtailment of medical benefits related to former hourly
employees of the Sheboygan Falls, Wisconsin Plant.  

Also in the fourth quarter 2004, the Company recorded an allowance
for an outstanding account receivable related to a significant
customer of the Engine & Power Train business that filed for
bankruptcy.  This amount was $2.5 million and is included in
selling and administrative expenses.

Consolidated results for the full year 2005 amounted to a net loss
of $223.5 million compared to net income of $10.1 million.  

Results for the full year 2005 included restructuring and
impairment charges of $111.3 million, primarily goodwill
impairment of $108.0 million recorded in the second quarter
related to the Company's Electrical Components business and
deferred tax valuation allowances related to operations in the
United States ($18.2 million) and Brazil ($7.1 million).  
Increases in interest costs for the quarter and the year were
primarily the result of a higher relative interest rate on the
Company's Senior Guaranteed Notes from the August 8th amendment.

Results for the full year 2004 included restructuring and
impairment charges of $5.6 million resulting from the
restructuring programs related to the North American Compressor,
Indian Compressor and Electrical Components businesses.

During the third quarter, the Company recognized valuation
allowances against previously recorded deferred tax assets related
to both its United States operations and the Brazilian Engine &
Power Train business.  As a result, the Company has a net tax
provision despite sizeable losses before taxes.  Under accounting
rules, the Company will not be providing tax benefit for related
losses in many of its taxing jurisdictions and future tax expense
or benefit will relate to only those jurisdictions where such
results are recognized.

Exclusive of the respective restructuring, impairment and other
items, fourth quarter and full year 2005 operating results were
lower than prior year periods, primarily due to weaker results in
the Company's Engine & Power Train and Compressor businesses.

Consolidated sales for the fourth quarter of 2005 amounted to
$442.2 million compared to sales of $471.9 million in the fourth
quarter of 2004.  Sales for the full year 2005 were
$1,847.0 million compared to sales of $1,911.7 million in the full
year 2004.

The effect of currency translation increased 2005 sales by
$13.4 million and $55.5 million in the fourth quarter and full
year, respectively.  Excluding the effects of currency
translation, sales in the fourth quarter and full year decreased,
primarily due to decreased sales in the Company's Engine & Power
Train and Compressor businesses.

                       Compressor Business

Fourth quarter 2005 sales in the Company's Compressor business
decreased by $11.7 million to $203.6 million from $215.3 million
in the fourth quarter of 2004.  The decrease over the comparable
quarter from the prior year was attributable to a decline in the
global market for compressor products sold into the original
equipment markets of residential refrigerators and freezers
and room air conditioners.  

Lower demand for small, high efficiency compressors used in
refrigerators and freezers, particularly in Europe and South
America, reduced volumes and intensified price competition.  Sales
of compressors utilized in room air conditioning also decreased
from India as customers switched from reciprocating-style
compressors to rotary-style compressors.  The effect of foreign
currency translation increased sales by $13.5 million.

Compressor business sales increased from the effects of foreign
currency translation with sales in the full year 2005 totaling
$910.9 million compared to $880.2 million for full year 2004.  
After the $56.3 million change in sales due to fluctuating
exchange rates is excluded, sales of compressors declined
in refrigeration and room air conditioning due to the factors
noted for the fourth quarter above.  These comparative declines
were partially offset by increases in aftermarket sales.

Compressor business operating loss for the fourth quarter of 2005
amounted to $4.8 million compared to income of $6.8 million in the
fourth quarter of 2004.  The decrease in operating income in 2005
versus the comparable 2004 quarter resulted from the unfavorable
exchange rate between the Brazilian Real and U.S. Dollar, which
impacted profits by $9.3 million.  Overall lower sales volumes in
the quarter also served to reduce the business profitability.

Operating income for the full year 2005 amounted to $18.8 million
compared to $60.5 million for the full year 2004.  Operating
income decreased for 2005 versus 2004 due to the impact of
commodity price increases, the unfavorable exchange rate in
Brazil, and the effect of lower volumes.  Cost saving activities
helped to lessen the impact of these factors.

                  Electrical Components Business

Electrical Components sales were $104.2 million in the fourth
quarter of 2005 compared to $108.3 million in the fourth quarter
of 2004.  Full year 2005 sales amounted to $410.1 million compared
to $422.6 million in full year 2004.

Fourth quarter 2005 segment operating profit was $3.5 million
compared to $0.1 million in fourth quarter 2004.  Segment
operating profit for the full year was $7.5 million compared to
$11.3 million for the same period in 2004.

The improvement in operating income for the quarter versus last
year was partly the result of lower amortization of intangible
assets and also reflected the benefit of cost reduction and
pricing increases serving to offset lower volumes.  Full year
results were also impacted by lower sales volumes, higher
commodity costs in excess of pricing recoveries, and unanticipated
operational inefficiencies related to the closure of the St. Clair
facility, partially offset by lower amortization of intangible
assets.

                  Engine & Power Train Business

Engine & Power Train business sales amounted to $106.3 million in
the fourth quarter of 2005 compared to $124.0 million in the
fourth quarter of 2004.  Sales in the full year 2005 were $404.1
million compared to $480.9 million in the full year 2004.  Sales
trends in the fourth quarter were consistent with those of the
full year.  The net decrease in sales reflected lower sales
volumes in the United States and Europe, primarily due to market
share losses.

Engine & Power Train business operating loss in the fourth quarter
of 2005 amounted to $33.8 million compared to a loss of $10.0
million in the fourth quarter of 2004.  In addition to the
operating losses generated by the reduction in year over year
volume, the Company incurred losses during the quarter related to
product recalls of $4.1 million and fees of $6.3 million
associated with the work of AlixPartners whom the Company engaged
during the third quarter of 2005 to assist in the restructuring
plans of the Engine & Power Train business with a focus on
improved profitability and customer service.

For the full year 2005, the business incurred an operating loss of
$75.1 million compared to an operating loss of $21.2 million in
2004.  The decline in full year results reflected losses in volume
and increases in commodity, transportation and tooling costs.  
Additionally, during the first quarter, the Company experienced
increased warranty response and expediting costs related to a
quality issue at a transmission business customer.  Continued
reductions in profitability in Europe also contributed to the
increase in the quarter and full year loss, and full year
AlixPartners fees amounted to $7.8 million.

Engine & Power Train losses were substantially due to the
significant costs associated with excess capacities in the U.S.
and Europe.  The excess capacity situation was exacerbated by the
shift of production to the Company's Brazilian manufacturing
facility resulting in duplicate capacities.  The substantial cost
reductions and volume improvements necessary for sustained
improvement have been initiated.  During the fourth quarter, the
Company announced the consolidation of engine assembly operations
in Corinth, Mississippi into its facility in Dunlap, Tennessee and
the closure of the Group's Italian operations.

                          Pump Business

Pump business sales in the fourth quarter of 2005 amounted to
$27.7 million compared to $23.9 million in 2004.  Full year sales
amounted to $120.1 million in 2005 compared to $126.4 million the
previous year.  The increase in fourth quarter sales was primarily
attributed to increased sales to industrial customers.  The
decline in the full year 2005 sales reflected a loss of a
significant retail customer in mid-2004.

Operating income in the fourth quarter of 2005 amounted to
$2.9 million compared to $2.4 million in the same period of 2004.  
Operating income in the full year 2005 amounted to $13.0 million
compared to $13.7 million in 2004.  The decrease in operating
income for the full year 2005 compared to 2004 was attributable to
lower sales and higher raw material costs.

Tecumseh Products Company -- http://www.tecumseh.com/-- is a full
line, independent global manufacturer of hermetic compressors for
air conditioning and refrigeration products, gasoline engines and
power train components for lawn and garden applications,
submersible pumps, and small electric motors.  Tecumseh's products
are sold in over 120 countries around the world.

                         *      *      *

As reported in the Troubled Company Reporter on July 19, 2005,
Tecumseh Products Company asked the holders of $300,000,000 of
4.66% Senior Guaranteed Notes Due March 5, 2011, to relax a
required 3:1 ratio of Consolidated Total Debt to Consolidated
Operating Cash Flow (tested on a rolling four-quarter basis) with
which the company failed to comply as of June 30, 2005.  The
Noteholders declined to modify the covenant.  The Noteholders
agreed to grant a temporary waiver of the default through Aug. 8,
2005.


TOMMY HILFIGER: Earns $15.5 Million in Third Quarter Ended Dec. 31
------------------------------------------------------------------
Tommy Hilfiger Corporation (NYSE: TOM) reported results for the
third quarter of its fiscal year ending March 31, 2006.

Net revenue for the third quarter of fiscal 2006 was
$396.6 million compared to $430.7 million for the third quarter of
fiscal 2005, a decrease of 7.9%.  Operating income was
$22.6 million for the third quarter of fiscal 2006 compared to
$20.5 million in the prior year's third quarter, an increase of
10.2%.  

The Company earned net income of $15.5 million as compared to
$20.2 million for the same period of fiscal 2005, a decrease of
approximately 23%.  Third quarter results for fiscal 2006 results
included an income tax provision of $6.0 million or a 28%
effective tax rate compared with a tax credit of $5.5 million in
the comparable prior year's quarter.  

Retail revenue for the third quarter of fiscal 2006 was
$185.8 million compared to $165.3 million a year earlier, an
increase of 12.4%.  Comparable sales at U.S. Company stores, the
largest retail division, increased in the low single digit
percentage range for the quarter.  

As of Dec. 31, 2005, the Company's worldwide store count was 223,
including 169 Company stores and 54 specialty stores, compared to
198 stores a year earlier, consisting of 158 Company stores and 40
specialty stores.  Included in the current year's total are eight
stores that the Company opened in the third quarter of fiscal
2006, as well as two closures.

U.S. wholesale revenue for the third quarter of fiscal 2006 was
$107.5 million compared to  $168.8 million for the third quarter
of fiscal 2005, a decrease of 36.3%.  Volume declined in each of
the men's wear, women's wear and children's wear divisions
primarily as a result of lower order levels from U.S. department
stores.  Approximately $13.5 million of this reduction is
attributed to the Company's exit of the Young Men's Jeans
wholesale business during fiscal 2005.

International wholesale revenue, consisting of the Company's
European and Canadian wholesale businesses, totaled $80.6 million
for the third quarter of fiscal 2006 versus $77.4 million for the
third quarter of fiscal 2005, an increase of 4.1%.  The increase
was driven primarily by continued momentum in Europe.  A year over
year decline in the Euro versus the U.S. Dollar partially offset
this increase.

Third party licensing revenue for the third quarter of fiscal 2006
was $20.6 million compared to $19.0 million for the third quarter
of fiscal 2005, an increase of 8.4% that was driven by higher
royalties and commissions from international licensees.

                     Balance Sheet Highlights

The Company had cash, cash equivalents, restricted cash and short-
term investments totaling $687.0 million at Dec. 31, 2005,
compared to $543.5 million at Dec. 31, 2004.  Restricted cash is
comprised of $150 million that is pledged as collateral under a
letter of credit facility entered into by Tommy Hilfiger U.S.A.,
Inc., in April 2005.  During fiscal 2006, the Company has received
aggregate net proceeds of $96.6 million from the sale of two
office buildings in New York City.

Inventories totaled $229.7 million at Dec. 31, 2005, compared to
$240.3 million at Dec. 31, 2004.

                       Nine Months Results

For the nine months ended Dec. 31, 2005, net revenue decreased
5.8% to $1,218.4 million from $1,293.7 million for the same period
of fiscal 2005.  For the comparable periods, segment revenues were
as follows:  

   -- retail revenue increased 13.8% to $453.4 million from
      $398.4 million;

   -- international wholesale revenue increased 12.6% to
      $360.2 million from $320.0 million;

   -- U.S. wholesale revenue decreased 34.3% to $342.7 million
      from $521.2 million; and

   -- third party licensing revenue increased 6.3% to
      $57.3 million from $53.9 million.  

Net income decreased by 5.6% to $67.7 million for the nine months
ended Dec. 31, 2005, from $71.7 million for the nine months ended
Dec. 31, 2004.  Results for the nine months ended Dec. 31, 2005,
included a tax provision of $26.4 million or a 28% effective tax
rate versus a tax credit of $1.6 million for the comparable
prior year period.

               Apax Partners Merger Agreement Update

The Company filed with the Securities and Exchange Commission on
Jan. 17, 2006, its preliminary proxy statement for the special
shareholder meeting to consider the proposed acquisition by funds
advised by Apax Partners.  The Federal Trade Commission granted
early termination of the Hart-Scott-Rodino waiting period.  

The Company currently expects to hold its shareholder meeting in
April 2006 and to consummate the merger promptly thereafter,
subject to the receipt of shareholder approval and the
satisfaction of the other conditions to closing.  The Apax
transaction was the result of a thorough sales process undertaken
over the preceding four months, including contacts with 24
potential strategic and financial bidders to solicit interest
in a potential transaction with the Company.  

The Company's Board of Directors reviewed with its financial
advisor, J.P. Morgan Securities Inc., the recent Schedule 13D
filing by Sowood Capital Management LP.  Following such review,
the independent directors unanimously reaffirmed their
determination that the Apax transaction is fair to and in the best
interests of the Company and its shareholders.

Since the announcement of the Apax transaction on Dec. 23, 2005,
no third party has contacted the Company or J.P. Morgan Securities
Inc. to express interest in a making a competing bid for the
Company.

Tommy Hilfiger Corporation, through its subsidiaries, designs,
sources and markets men's and women's sportswear, jeans wear and
children's wear.  The Company's brands include Tommy Hilfiger and
Karl Lagerfeld.  Through a range of strategic licensing
agreements, the Company also offers a broad array of related
apparel, accessories, footwear, fragrance, and home furnishings.  
The Company's products can be found in leading department and
specialty stores throughout the United States, Canada, Europe,
Mexico, Central and South America, Japan, Hong Kong, Australia and
other countries in the Far East, as well as the Company's own
network of outlet and specialty stores in the United States,
Canada and Europe.

                            *   *   *

As previously reported in the Troubled Company Reporter on
Dec. 27, 2005, Standard & Poor's Ratings Services said that its
ratings on Tommy Hilfiger USA Inc., including its 'BB-' corporate
credit rating, remain on CreditWatch with negative implications,
where they were placed on Nov. 3, 2004.


TRIPATH TECH: Reports $3.4 Million First Quarter Net Revenue
------------------------------------------------------------
Tripath Technology Inc. reported estimated financial results for
the first quarter of fiscal 2006 ended Dec. 31, 2005.  

Tripath Technology Inc. incurred a $4,727,000 net loss on
$3,422,000 of revenue for the three-months ended Dec. 31, 2005, as
compared to a $2,878,000 net loss on $1,673,000 of revenue for the
same period in the prior year.

The Company's balance sheet at Dec. 31, 2005, showed $10,914,000
in total assets and liabilities of $13,498,000.   At Dec. 31,
2005, the Company had negative working capital of $3.4 million,
including unrestricted cash of $1.7 million.

"Demonstrating continued improvement over 2005, first quarter
revenue exceeded our original guidance and results were consistent
with our pre-announcement made on January 18." said Dr. Adya
Tripathi, Tripath's Chairman, President and CEO.  "Flat panel
television sales delivered particularly strong revenue
contribution and comprised over 71 percent of total dollar sales.
Additionally, digital subscriber line (DSL) driver products and
convergence products, such as the popular iPod(TM) docking
stations, also drove sales growth."

"We have been focused on continuing to drive fundamental
improvements in our business and are committed to the goal of
achieving profitability.  Our strategy is to leverage our
technology leadership and strong intellectual property position
with timely and well-positioned product introductions into
existing and new markets.  We are building on the market
opportunities in flat panel TVs, home theatre, automotive audio
and personal computer (PC) convergence as our chips and technology
are embedded into a growing number of high-volume end products.  
We are also gaining traction with new design wins and expanded use
in key customers' product lines," added Dr. Tripathi.

"We delivered first quarter revenue growth of over 100 percent
compared to a year ago while continuing to manage operating
expenses," said Jeffrey L. Garon, Vice President and CFO of the
company.  "Our loss from operations for the quarter was $2.5
million, which included approximately $460,000 in non-cash charges
for the adoption of SFAS123R.  In addition, we strengthened our
balance sheet with a cash infusion and ended the quarter with
improvements in our working capital position that are expected to
help relieve some of the production constraints that impacted us
in the fourth quarter of fiscal 2005."

                       Financial Guidance

Second fiscal quarter revenue is expected to range from
approximately $3.5 million to $3.7 million, or approximately flat
to an increase of 10 percent compared to the first fiscal quarter
of 2006.  Additionally, the company expects a small favorable
impact to gross margin in the March quarter from the anticipated
sale of inventory that has previously been written down to its
estimated net realizable value in the range of 5 percent to 10
percent and, thus, would expect to report gross margin for the
quarter in the range of 20 percent to 30 percent.

"Total operating expenses for the second quarter of fiscal 2006
are expected to be approximately flat when compared to the first
quarter of fiscal 2006.  Primary risks to the accuracy of this
number are due to uncertainty in our estimated legal expenses
associated with pending litigation and entries required to remain
in compliance with SFAS123R," added Garon.

"Excluding the additional potential impact related to the
accounting of the warrants and debentures, we expect the net loss
for the second quarter of fiscal 2006 to be in the range of $0.05
to $0.06 per share."

"As we continue to execute our strategy during the first half of
fiscal 2006, we expect to continue building unit volumes, working
to reduce product costs and expanding our product applications
base. We expect that our overall performance will continue to
drive us in the direction of profitability," Garon concluded.

                    Going Concern Doubt

Stonefield Josephson, Inc., expressed substantial doubt about
Tripath Technology Inc.'s ability to continue as a going concern
after it audited the Company's financial statements for the year
ended Sept. 30, 2005 and 2004.  The auditing firm pointed to the
Company's recurring operating losses and accumulated deficit.

                      About Tripath

Headquartered in San Jose, California, Tripath Technology Inc. --
http://www.tripath.com/-- is a fabless semiconductor company that  
focuses on providing highly efficient power amplification to the
Flat Panel Television, Home Theater, Automotive Audio and Consumer
and PC Convergence markets.  Tripath owns the patented technology
called Digital Power Processing (DPP(R)), which leverages modern
advances in digital signal processing and power processing.
Tripath markets audio amplifiers with DPP(R) under the brand name
Class-T(R).  Tripath's current customers include, but are not
limited to, companies such as Alcatel, Alpine, Hitachi, JVC,
Samsung, Sanyo, Sharp, Sony and Toshiba.


UNIVERSITY HEIGHTS: Case Summary & 12 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: University Heights Association, Inc.
        130 New Scotland Avenue
        Albany, New York 12208
        Tel: (518) 434-9603
        Fax: (518) 462-3207

Bankruptcy Case No.: 06-10226

Type of Business: The Debtor is composed of four educational
                  institutions with the aim of enhancing the
                  economic vitality and quality of life of its
                  immediate community.  See
                  http://www.universityheights.org/

Chapter 11 Petition Date: February 13, 2006

Court: Northern District of New York (Albany)

Debtor's Counsel: Peter A. Pastore, Esq.
                  McNamee, Lochner, Titus & Williams, PC
                  P.O. Box 459
                  677 Broadway
                  Albany, New York 12201-0459
                  Tel: (518) 447-3246

Estimated Assets: $10 Million to $50 Million

Estimated Debts:  $10 Million to $50 Million

Debtor's 12 Largest Unsecured Creditors:

   Entity                          Nature of Claim   Claim Amount
   ------                          ---------------   ------------
Marty and Dorothy Silverman        Loan               $22,000,000
Foundation
150 East 58th Street, 29th Floor
New York, New York 10155

Albany Law School                  Loan                $2,157,592
80 New Scotland Avenue
Albany, New York 12208

Albany College of Pharmacy         Loan                $1,527,156
106 New Scotland Avenue
Albany, New York 12208

The Sage Colleges                  Loan                   $65,025

Albany Medical Center              Loan                   $43,300

Citicorp Vendor Finance            Equipment Lease        $19,266

Key Equipment Finance, Inc.        Equipment Lease        $10,000

Com Doc, Inc.                      Equipment Lease         $6,820

Applied Theory Corporation         Trade Debt              $1,611

Pitney Bowes Credit Corp.          Equipment Lease         $1,200

American Express                   Credit Card             $1,000

Exxon Mobil                        Credit Card               $613


USG: Dist. Ct. Revises Asbestos Estimation Discovery Schedule
-------------------------------------------------------------
Having fully considered the arguments presented by various
parties in filings or during hearings regarding discovery issues,
the United States District Court for the District of Delaware
revised the discovery schedule for the estimation of the Debtors'
asbestos personal injury liabilities.

Specifically, Judge Joy Flowers Conti rules that:

   (1) The sampled 2000 PI claimants must complete and return
       their Questionnaires, including all requested
       documentation, to RUST Consulting, Inc., the Debtors'
       claims processing agent.  

   (2) RUST will scan and electronically distribute the
       Questionnaires to counsel for the parties on or before
       February 23, 2006.  Original radiographic evaluations
       will be retained by RUST and made available for
       inspection by the parties or their experts on reasonable
       terms.

   (3) RUST will organize the information contained in the
       Questionnaires into a searchable database, which will be
       provided to the parties no later than March 27, 2006.

Judge Conti wants the fact discovery to close on July 31, 2006,
subject to the District Court granting an extension of that date
based on any party's request.

The parties will exchange fully updated lists of the experts they
intend to call as witnesses in their case-in-chief during the
Estimation by July 7, 2006.

Judge Conti will hold a hearing at 2:00 p.m. on July 18, 2006, to
address the appropriate schedule for expert discovery.

     Parties Want Estimation Proceedings Stayed Immediately

On January 26, 2006, the Debtors, the Official Committee of
Asbestos Personal Injury Claimants, and Dean M. Trafelet, as the
Legal Representative for Future Claimants executed a term sheet
governing the basic terms on which the parties have agreed to
settle certain disputes relating to the Debtors' alleged
liability for asbestos-related personal injury claims and
demands.

The Term Sheet, when implemented by a confirmed plan of
reorganization for the Debtors, will resolve all the disputes
relating to:

   (1) the estimation of the Debtors' liability for PI claims;
       and

   (2) the Debtors' request for a declaration with respect to
       the voting rights of certain putative claimants.

In addition, the Term Sheet also provides that a stay of the
estimation litigation will be sought.

In light of the pending settlement, the Debtors, the PI
Committee, the Futures Representative, the Official Committee of
Unsecured Creditors, and the Statutory Committee of Equity
Security Holders jointly ask Judge Conti that those pending
actions, including all discovery efforts, be stayed immediately.

The Official Committee of Property Damage Claimants takes no
position on the Motion.

Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, tells Judge Conti that an automatic stay
of those proceedings is necessary to allow the parties to focus
their energies on the creation of a plan of reorganization to be
submitted for confirmation in the United States Bankruptcy Court
for the District of Delaware.

Mr. DeFranceschi further asserts that the Stay will protect the
Debtors' estate from needless additional expense.

Should any material change in the status of the pending
settlement occur, or should the parties, for any reason,
determine that a resumption of those proceedings is necessary,
the parties will inform the District Court promptly.

Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.  The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094).  David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. (USG
Bankruptcy News, Issue No. 102; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


VALERO ENERGY: Fitch Raises Securities' Rating to BBB- from BB+
---------------------------------------------------------------
Fitch Ratings raised the issuer default rating and senior
unsecured debt rating of Valero Energy Corporation to 'BBB' from
'BBB-'.  Fitch also raised the rating on the mandatory convertible
preferred securities to 'BBB-' from 'BB+'.  The Rating Outlook is
Stable.

The rating action recognizes the rapid reduction in debt following
the acquisition of Premcor Inc. as balance sheet debt was under
$5.4 billion at year-end 2005 from $6.4 billion at the end of the
third quarter.  The benefit of a full quarter of the Premcor
refineries and the spike in margins following hurricanes Katrina
and Rita pushed fourth quarter EBITDA to $2.26 billion and nearly
$7.0 billion for the full year.  As a result, credit protection
metrics are very robust with year-end 2005 debt-to-EBITDA of 0.8x
and interest coverage of 20.8x.

The company also continues to benefit from the size and diversity
of its asset base and its significant leverage to heavy and sour
crudes.  The company now operates 18 refineries with crude
capacity of approximately 2.8 million barrels per day (mmbpd) and
total capacity of 3.25 mmbpd including other feedstocks.  Sixteen
of the refineries are also at or above 100,000 barrels per day of
capacity, the desired benchmark for achieving economies of scale.
Although several of the company's refineries were impacted by the
hurricanes, overall throughput remained strong due to the
geographic diversification and the company's ability to quickly
return its assets to production.

The complexity of the company's asset base with significant
downstream conversion capacity allows heavy and sour crudes to
represent approximately 1.8 mmbpd of the company's throughput.  
The discount for heavy sour Maya crude to West Texas Intermediate
averaged $15.30 per barrel in 2005 versus the 2000 to 2004 average
of $8.00 per barrel.  The Mars discount has shown a dramatic
widening as well under the current crude price environment,
averaging $6.37 per barrel versus a discount of $4.75 from 2000 to
2004.  This flexibility and the continued investment the company
is making in its downstream units should allow better management
during downturns in the industry cycle.

Offsetting factors continue to include the company's historical
use of debt to finance sizable acquisitions.  As seen with
Premcor, the company has also reduced debt subsequent to the
financings.  While further sizable targets are limited, further
acquisitions remain a possibility.  

Valero also continues to operate in a highly volatile margin
industry as noted with the recent decline in industry margins.
Capital expenditures will also remain high with 2006 guidance of
$3.4 billion, although regulatory and Tier II fuel spending will
decline in 2007 allowing for more strategic spending.  Finally,
stock repurchases to offset dilution will likely make up a greater
piece of Valero's financial strategy given the lack of acquisition
targets.  Fitch would expect Valero to manage stock repurchases
prudently and not risk the improved credit profile.


VERITAS DGC: Inks New $85 Million Credit Facility
-------------------------------------------------
Veritas DGC Inc. (TSX:VTS)(NYSE:VTS) entered into a new five-year
$85 million revolving loan agreement with a syndicate of banks led
by:

     * Wells Fargo Bank and National Association, as U.S. agent
       and lead arranger,

     * HSBC Bank Canada, as Canadian agent,

     * The Hongkong and Shanghai Banking Corporation Limited,
       Singapore Branch, as Singapore agent, and

     * HSBC Bank plc, as U.K. agent.

The new facility provides for revolving loans and the issuance of
letters of credit to Veritas and certain of its subsidiaries of up
to:

     * $45 million in the United States,
     * $15 million in Canada,
     * $15 million in Singapore and
     * $10 million in the United Kingdom.

Certain closing conditions are yet to be met with regard to the
Singapore portion of the facility, but are currently expected to
be satisfied by mid-February.  Until those conditions are met, the
Singapore portion of the facility will not be available for
borrowing or letters of credit.

The new facility is secured by pledges of accounts receivable,
certain intercompany notes, stock in certain Veritas subsidiaries,
and the U.S. land data library.  Veritas and certain of its U.S.
and foreign subsidiaries have also issued loan guarantees.  
Interest rates on borrowings under the facility are selected by
the borrower at the time of any advance and, prior to April 30,
2006, the rates so selected may be either at LIBOR plus 1.00% or
the Base Rate.  On and after April 30, 2006, these rates may be
adjusted upward depending upon Veritas's leverage ratio to a
maximum of LIBOR plus 1.50% or the base rate plus 0.50%.  The loan
agreement and related documents contain customary financial
covenants and default provisions.

This new credit facility replaces the previous credit facility
with Deutsche Bank, which was entered into in February 2003 and
has now been terminated.  All letters of credit outstanding under
the previous Deutsche Bank facility, totaling approximately
$7 million as of the time of closing were rolled into the new
credit facility.  There were no borrowings outstanding under the
previous facility at the time of closing.

"This new facility has significantly more favorable terms than our
previous facility and, when combined with our existing cash,
provides us tremendous flexibility for continued growth" Mark
Baldwin, Executive Vice President, Chief Financial Officer and
Treasurer of Veritas, said.  "We are very pleased to have this new
facility and look forward to continuing our relationship with all
of the banks in our lending group."

Headquartered in Houston, Texas, Veritas DGC Inc. is a leading
provider of integrated geophysical information and services to the
petroleum industry worldwide.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 25, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on seismic services company Veritas DGC Inc. to 'BB' from
'BB+'.

Standard & Poor's also assigned its 'BB' rating to the company's
$155 million in convertible floating rate senior notes due in
2024.
     
The outlook is stable.  As of July 31, 2005, Houston, Texas-based
Veritas had approximately $232 million in adjusted total debt.
     
"The downgrade reflects our concerns regarding the volatility and
cyclicality associated with the geophysical sector throughout the
hydrocarbon pricing cycle," said Standard & Poor's credit analyst
Jeffrey Morrison.


VIACAO ITAPEMIRIM: Fitch Affirms & Withdraws CCC Sr. Notes' Rating
------------------------------------------------------------------
Fitch Ratings affirmed and simultaneously withdrew the 'CCC'
rating assigned to Viacao Itapemirim S.A.'s (VISA) 12% senior
secured notes and removed the rating from Rating Watch Negative.
Fitch withdrew the rating consistent with its policies and will no
longer provide ratings or analytical coverage of this issue.

The notes totaling US$25.3 million (approximately BRL60 million)
were issued in February and April 2004 and were paid on time and
in full on Feb. 10, 2006.

VISA is the leading provider of interstate passenger bus
transportation services in Brazil.  The company operates a fleet
of about 1,265 buses in 21 of Brazil's 26 states and serves more
than 2,000 cities.  VISA benefits from its position as one of the
leaders in interstate passenger bus transportation in Brazil.  

The industry enjoys:

   * high barriers to entry;

   * price competitive advantages in relation to alternative
     passenger transportation means; and

   * satisfactory regulated tariff revisions.

VISA's revenues are a function of:

   * the number of buses operating;
   * passenger volume;
   * occupancy rates; and
   * ticket prices.

The company's top 10 operating routes accounted for 31% of its
gross revenues in 2004, while its top three operating routes (Sao
Paulo to Rio de Janeiro; Sao Paulo to Curitiba; and Sao Paulo to
Fortaleza) accounted for 14% of its gross revenues in 2004.

VISA is part of the Itapemirim Group, which consists of 17 family-
owned companies operating a broad spectrum of businesses (e.g.
cargo, tourism, granite mining, and hotel and food services) with
more than 14,000 employees.  The group's primary activity is
interstate passenger bus service.  Three of the group's companies
(VISA, Penha, and Viacao Kaiowa) form a consolidated fleet of
1,900 buses that transport approximately 5.0 million passengers
annually.


VIRAGEN INC: Posts $4.6 Million Net Loss in Quarter Ended Dec. 31
-----------------------------------------------------------------
Viragen, Inc. (Amex: VRA), delivered its financial results for the
quarter ended Dec. 31, 2005, to the Securities and Exchange
Commission on Feb. 9, 2006.

For the three-months ended Dec. 31, 2005, Viragen incurred a $4.6
million net loss on $116,973 of revenue, versus a $3.5 million net
loss on $52,548 of revenue for the comparable period in 2004.

The Company's balance sheet at Dec. 31, 2005, showed $15.6 million
in total assets and liabilities of $16 million, resulting in a
stockholders' deficit of $581,789.

Viragen had working capital of approximately $2.2 million at
Dec. 31, 2005, compared to a working capital deficit of
approximately $7.3 million as of June 30, 2005.  The change in
working capital is primarily attributed to the reclassification of
the Company's convertible notes from current to long-term as a
result of the amendments dated Sept. 15, 2005, which extended the
due date of the notes from March 31, 2006 to Aug. 31, 2008.

                  Going Concern Doubt

Ernst & Young LLP expressed substantial doubt about Viragen's
ability to continue as a going concern after it audited the
Company's financial statements for the fiscal year ended June 30,
2005.  The auditors point to the Company's operating losses,
accumulated deficit and working capital deficiency.  

                      About Viragen

With global operations in the U.S., Scotland and Sweden, Viragen -
- http://www.Viragen.com/-- is a biotechnology company engaged in  
the research, development, manufacture and commercialization of
pharmaceutical proteins for the treatment of viral diseases and
cancers.


WINDSWEPT ENVIRONMENTAL: Earns $3MM of Net Income in 2nd Quarter
----------------------------------------------------------------
Windswept Environmental Group, Inc., delivered its financial
results for the quarter ended Dec. 27, 2005, to the Securities and
Exchange Commission on Feb. 8, 2006.

Windswept earned $3,196,162 of net income for the quarter ended
Dec. 27, 2005, as compared to $1,388,310 of net income for the
quarter ended Dec. 28, 2004.

The Company generated $17,714,342 of total revenue for the quarter
ended Dec. 27, 2005, a 140.7% increase from the $7,359,279 of
revenue recorded for the quarter ended Dec. 28, 2004.  Management
attributes the substantial increase in revenue to $14,108,400 of
revenues from work relating to Hurricane Katrina and $1,320,769 of
revenues from work relating to Hurricane Wilma.

At Dec. 27, 2005, the Company's balance sheet showed $22,613,603
in total assets and liabilities of $11,310,638.  

As of Dec. 27, 2005, the Company had a cash balance of $2,494,266,
working capital of $6,079,337 and stockholders' equity of
$10,002,965.  In contrast, the Company had a cash balance of
$512,711, a working capital deficit of $1,704,091, and a
stockholders' deficit of $712,889 at June 28, 2005.

The Company was recapitalized on June 30, 2005, after completing a
financing transaction in which it issued a secured convertible
term note which resulted in the repayment of its secured note
payable-related party and a change of control of the Company.

                     Going Concern Doubt

Massella & Associates, CPA, PLLC, expressed substantial doubt
about Windswept's ability to continue as a going concern after it
audited the Company's financial statements for the fiscal year
ended June 28, 2005.  The auditing firm pointed to the Company's
recurring losses from operations, difficulties in generating
sufficient cash flow to sustain operations as well as working
capital and stockholders' deficits.

                       About Windswept

Windswept Environmental Group, Inc., through its wholly owned
subsidiary, Trade-Winds Environmental Restoration, Inc. --
http://www.tradewindsenvironmental.com/ -- provides a full array  
of emergency response, remediation, disaster restoration and
commercial drying services to a broad range of clients.


XYBERNAUT CORP: Court Okays Chantilly Office Lease Agreement
------------------------------------------------------------
The United States Bankruptcy Court for the Eastern District of
Virginia authorized Xybernaut Corporation and Xybernaut Solutions,
Inc., to enter into an Office Lease Agreement with Justice Federal
Credit Union on Jan. 24, 2006.

The Debtors leased approximately 9,656 square feet of office space
at 5175 Parkstone Drive, located at Chantilly, Virginia.  Pursuant
to the lease, the Debtors will $224,502 rent for the first year of
the lease.  The rent is payable monthly and will increase 3%
annually.  The lease term started on Feb. 1, 2006, for 36 months.

Under the lease, the Debtors also paid a $74,834 security deposit.

Headquartered in Fairfax, Virginia, Xybernaut Corporation,
develops and markets small, wearable, mobile computing and
communications devices and a variety of other innovative products
and services all over the world.  The corporation never turned a
profit in its 15-year history.  The Company and its affiliate,
Xybernaut Solutions, Inc., filed for chapter 11 protection on
July 25, 2005 (Bankr. E.D. Va. Case Nos. 05-12801 and 05-12802).
John H. Maddock III, Esq., at McGuireWoods LLP, represents the
Debtors in their chapter 11 proceedings.  Michael Z. Brownstein,
Esq., at Blank Rome LLP, represents the Official Committee of
Unsecured Creditors.  The U.S. Trustee has appointed an Official
Committee of Equity Security Holders; the equity panel has
retained Kevin M. O'Donnell, Esq., at Henry, O'Donnell, Dahnke &
Walther, P.C., as counsel.  Alfred F. Fasola at Boardroom
Specialist, LLC, serves as Xybernaut's restructuring advisor
and consultant, at a rate of $2,500 per day.  When the Debtors
filed for protection from their creditors, they listed $40 million
in total assets and $3.2 million in total debts.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------  
                                Total  
                                Shareholders  Total     Working  
                                Equity        Assets    Capital  
Company                 Ticker  ($MM)          ($MM)     ($MM)  
-------                 ------  ------------  -------  --------  
Abraxas Petro           ABP         (27)         120       (4)
Accentia Biophar        ABPI         (8)          34      (20)
AFC Enterprises         AFCE        (44)         216       53
Alaska Comm Sys         ALSK         (9)         589       49
Alliance Imaging        AIQ         (43)         643       42
AMR Corp.               AMR        (729)      29,436   (1,882)
Atherogenics Inc.       AGIX        (98)         213      190
Bally Total Fitn        BFT      (1,463)         486     (442)
Biomarin Pharmac        BMRN       (65)          209      (38)
Blount International    BLT        (201)         427      110
CableVision System      CVC      (2,486)      10,204   (1,881)
CCC Information         CCCG        (95)         112       34
Centennial Comm         CYCL       (488)       1,511       69
Cenveo Inc              CVO         (12)       1,146      127
Choice Hotels           CHH        (165)         289      (34)
Cincinnati Bell         CBB        (710)       1,863       16
Clorox Co.              CLX        (528)       3,567     (205)
Columbia Laborat        CBRX        (13)          17       10
Compass Minerals        CMP         (83)         686      149
Crown Holdings I        CCK        (236)       6,545      (98)
Crown Media HL          CRWN        (64)       1,250     (125)
Deluxe Corp             DLX         (82)       1,426     (277)
Denny's Corporation     DENN       (261)         498      (72)
Domino's Pizza          DPZ        (553)         414        3
DOV Pharmaceutic        DOVP         (3)         116       94
Echostar Comm           DISH       (785)       7,533      321
Emeritus Corp.          ESC        (134)         713      (62)
Foster Wheeler          FWLT       (375)       1,936     (186)
Gencorp Inc.            GY          (73)       1,057        9
Graftech International  GTI         (13)       1,026      283
Guilford Pharm          GLFD        (20)         136       60
Hercules Inc.           HPC         (13)       2,548      330
Hollinger Int'l         HLR        (177)       1,001     (396)
I2 Technologies         ITWO        (71)         202      (34)
ICOS Corp               ICOS        (67)         232      141
IMAX Corp               IMAX        (34)         245       30
Immersion Corp.         IMMR        (15)          46       29
Indevus Pharma          IDEV       (115)         113       79
Intermune Inc.          ITMN        (30)         194      109
Investools Inc.         IED         (20)          64      (46)
Koppers Holdings        KOP        (186)         570      120
Kulicke & Soffa         KLIC         (3)         440      216
Level 3 Comm. Inc.      LVLT       (632)       7,580      502
Ligand Pharm            LGND        (96)         306      (99)
Lodgenet Entertainment  LNET        (69)         283       22
Maxxam Inc.             MXM        (677)       1,044      114
Maytag Corp.            MYG        (187)       2,954      150
McDermott Int'l         MDR         (53)       1,627      244
McMoran Exploration     MMR         (58)         408       67
NPS Pharm Inc.          NPSP        (55)         354      258
Omnova Solutions        OMN         (13)         355       46
Owens Corning           OWENQ    (8,443)       8,142      976
ON Semiconductor        ONNN       (276)       1,148      228
Quality Distribu        QLTY        (26)         377       20
Quest Res. Corp.        QRES        (27)         244      (29)
Qwest Communication     Q        (2,716)      23,727      822
Revlon Inc.             REV      (1,169)         980       86
Riviera Holdings        RIV         (28)         221        6
Rural/Metro Corp.       RURL        (89)         310       54
Rural Cellular          RCCC       (460)       1,367       46
SBA Comm. Corp.         SBAC        (47)         886       25
Sepracor Inc.           SEPR       (165)       1,275      879
St. John Knits Inc.     SJKI        (52)         213       80
Tivo Inc.               TIVO         (9)         163       36
Unigene Labs Inc.       UGNE        (15)          14       (9)
Unisys Corp             UIS         (33)       4,029      339
Vector Group Ltd.       VGR         (38)         536      168
Vertrue Inc.            VTRU        (30)         446      (82)
Visteon Corp.           VC       (1,430)       8,823      404
Worldspace Inc.         WRSP     (1,475)         765      249
WR Grace & Co.          GRA        (559)       3,517      876

                             *********

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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