/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/060614.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, June 14, 2006, Vol. 10, No. 140 Headlines ALION SCIENCE: Unit Purchase Plan Prompts S&P's Negative Watch ALLIED HOLDINGS: Wants Additional Wage and Compensation Reductions ALLIED PRINTING: Judge Funk Rules Equipment Deal Is a Lease AXLETECH INT'L: Moody's Holds Junk Rating on Senior Secured Loan BOYDS COLLECTION: Maryland Court Confirms Plan of Reorganization C-BASS MORTGAGE: Moodys Rates Class B-4 Certificates at Ba1 CAPITALSOURCE COMMERCIAL: Fitch Holds BB Rating on $39 Mil. Notes CARDSYSTEMS SOLUTIONS: Hires Mesch Clark as Bankruptcy Counsel CITATION CORP: High Debt Leverage Prompts S&P to Cut Rating to B- CLECO EVANGELINE: Moody's Ups Rating on Senior Sec. Bonds to Ba2 COLLINS & AIKMAN: Sells Looms to Petit Textile for $690,000 COLLINS & AIKMAN: Court Approves Amended GM Transition Agreement CONTINENTAL AIRLINES: Upgrades Fleet with 10 New Boeing 787's CORNELL COMPANIES: Seeks Advise on Strategic Alternatives CRESCENT JEWELERS: Wants Until August 29 to Decide on Leases CUMULUS MEDIA: Inks $850 Million Revolving Credit Deal with BofA DELPHI CORP: MobileAria Auction Scheduled for July 10 DELPHI CORP: Wants Until February 2007 to File Chapter 11 Plan DELTA MILLS: Amends Terms of $40 Million GMAC Credit Facility DIVERSIFIED FIN.: March 31 Balance Sheet Upside Down by $1.7 Mil. ENTI INC: Case Summary & 44 Largest Unsecured Creditors EVANS INDUSTRIES: U.S. Trustee Reconstitutes Official Committee EVANS INDUSTRIES: Court Establishes July 5 as Claims Bar Date EXIDE TECHNOLOGIES: District Court Adjusts Fine Payment Schedule FRESENIUS AG: Fitch Rates Senior Unsecured Debt at BB GEORGIA GULF: Planned Royal Group Buy Prompts S&P's Negative Watch GLOBAL CROSSING: Inks 1st Supplemental Indenture for 5% Sr. Notes GT BRANDS: Plan Confirmation Hearing Scheduled for July 18 HILITE INDUSTRIES: Moody's Withdraws Junk Rating on $130 Mil. Loan HILITE INT'L: Insufficient Info Cues Moody's to Withdraw Rating INDUSTRIAL ENT: Posts $2.2 Mil. Net Loss in First Quarter 2006 INTELSAT LTD: Unit Proposes $1.9 Billion Senior Notes Offering INT'L COAL INC: S&P Junks Rating on Proposed $250 Mil. Sr. Notes INT'L COAL LLC: S&P Rates $350 Million Secured Facility at B INTERPUBLIC GROUP: Howard Draft Leads United FCB and Draft Units J.L. FRENCH: Court Approves Varnum Riddering as Special Counsel J.P. MORGAN: Moody's Assigns Low-B Ratings on Two Cert. Classes JAMES RIVER: Can Draw on $25 Million Debt Facility JESSE REESE: Case Summary & 16 Largest Unsecured Creditors KNOLL INC: Adopts 10b5-1 Plan for $50 Million Share Repurchase LAZY DAYS: Depressed RV Sales Prompt S&P's Negative Outlook LEHMAN XS: Moody's Rates Class B Notes at Ba2 LENOX HEALTHCARE: Court Nixes Preference Claims v. Guardian Life LIBBEY GLASS: S&P Rates Proposed $300 Million Senior Notes at B LITFUNDING CORP: Court Enters Final Decree Closing Chapter 11 Case LOVESAC CORP: Court Approves CapitalLink LC as Investment Banker LUCENT TECH: Gets Early Termination of Merger Waiting Period MAAX CORP: Weak Liquidity Prompts S&P to Downgrade Ratings MAAX HOLDINGS: Weak Liquidity Prompts S&P to Junk Ratings MASTERCRAFT INTERIORS: Hires Shulman Rogers as Bankruptcy Counsel MERIDIAN AUTOMOTIVE: Wants Watson Wyatt as Actuary MERIDIAN AUTOMOTIVE: Likely Lenders & Debtors Tap Hilco Appraisal MERIDIAN AUTOMOTIVE: Wants BDO Seidman's Scope of Work Expanded MIRANT CORPORATION: Withdraws Proposal to Acquire NRG Energy ML-CFC COMMERCIAL: S&P Assigns Low-B Ratings on Six Cert. Classes MOUNT SKYLIGHT: Moody's Rates $9.5 Mil. Subordinated Notes at Ba2 MUELLER WATER: IPO Prompts S&P to Lift Rating and Remove Watch NEW SEABURY: 1st Cir. Says $550K of Disputed Funds Aren't Debtor's NORAMPAC INC: Moody's Assigns Ba2 Rating on C$325 Million Loan NRG ENERGY: Resumes Growth Plan Despite Mirant's Withdrawn Offer NRG ENERGY: Mirant Bid Withdrawal Prompts S&P to Remove Watch O'SULLIVAN INDUSTRIES: Sentry Wants Claim Objection Denied PERFORMANCE TRANSPORTATION: Ford Wants to Enforce Lease Rights PERFORMANCE TRANSPORTATION: Lease Decision Period Moved to Aug. 23 PERFORMANCE TRANSPORTATION: Hires Reed Smith as Special Counsel POSITRON CORP: Secures $2 Million Loan from Private Investors PRESIDENT CASINOS: Deloitte & Touche Raises Going Concern Doubt PRUDENTIAL STRUCTURED: Fitch Cuts Rating on $19.7 Million Notes RALI SERIES: Moody's Puts Ba2 Rating on Class M-10 Certificates RASC SERIES: Moody's Puts Low-B Ratings on Two Cert. Classes REVLON INC: Lowers Revenue Guidance for 2006 and Beyond RIEFLER CONCRETE: Case Summary & 24 Largest Unsecured Creditors ROYAL GROUP: Georgia Gulf Takeover Offer Cues S&P to Retain Watch SAINT VINCENTS: City of New York Asserts Liens on Queens Hospitals SAMSONITE CORPORATION: Closes Denver Distribution Facilities SANTIAGO ASSOCIATES: Taps Hirsch Law Office as Bankruptcy Counsel SENIOR HOUSING: Reports $15.7 Million Net Income in First Quarter SMART HOME: Moody's Rates Class B-1 Certificates at Ba1 STRUCTURED ASSET: Moody's Puts Low-B Ratings on Two Cert. Classes SUNNY DELIGHT: Aggressive Leverage Prompts S&P to Junk Ratings T.A.T. PROPERTY: Plan Proposes to Pay Unsec. Creditors in Full TANK SPORTS: Kabani & Company Raises Going Concern Doubt TEEKAY SHIPPING: Moody's Holds Corporate Family Rating at Ba1 TENASKA ALABAMA: Moody's Ups Rating on Senior Secured Bonds to Ba2 US AIRWAYS: Good Performance Prompts S&P's Stable Outlook US ONCOLOGY: Moody's Rates Proposed $100 Mil. Term Loan at Ba3 US ONCOLOGY: S&P Rates $100 Million Senior Secured Term Loan at B VERIDICOM INT'L: Accumulated Deficit Tops $21.3 Mil. at March 31 VILLAGEEDOCS INC: Posts $273,389 Net Loss in First Quarter 2006 VINOD CHAND: Voluntary Chapter 11 Case Summary WELLSFORD REAL: Incurs $2.8 Net Loss in Quarter Ending March 31 WESCO INT'L: Moody's Affirms Low-B Ratings on Corp. Family & Bonds WERNER LADDERS: Files For Chapter 11 Reorganization in Delaware WERNER LADDERS: Judge Carey Approves All First Day Motions WERNER LADDERS: Case Summary & 30 Largest Unsecured Creditors WILLIAMS COMPANIES: Earns $131.9 Million in First Quarter * Mauricio Pons Joins Alvarez & Marsal as Director * Howard Brod Brownstein Participates in BAPCPA Panel * Upcoming Meetings, Conferences and Seminars ********* ALION SCIENCE: Unit Purchase Plan Prompts S&P's Negative Watch -------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B+' corporate credit and senior secured debt ratings on McLean, Virginia-based Alion Science and Technology Corp. on CreditWatch with negative implications. The CreditWatch listing follows the announcement that Alion's wholly owned subsidiary has entered into an asset purchase agreement with Anteon International Corp. pursuant to which Alion will purchase the contracts and certain other assets comprising Anteon's program management and engineering services business for approximately $225 million. The CreditWatch listing reflects uncertainty surrounding the financing plans for this transaction, although it is expected to be largely debt-financed. "While this acquisition strengthens Alion's relationship with the Department of Defense, particularly the U.S. Navy and Air Force, Alion's debt leverage, which is already high for rating, likely will increase," said Standard & Poor's credit analyst Ben Bubeck. Standard & Poor's will meet with management to discuss financing plans for the acquisition to resolve the CreditWatch listing. ALLIED HOLDINGS: Wants Additional Wage and Compensation Reductions ------------------------------------------------------------------ Managers at Allied Holdings, Inc. repeated their request to the U.S. Bankruptcy Court in Georgia on June 8, 2006, to continue to impose wage and compensation reductions at the U.S.-operations of Allied Systems, Ltd., F.J. Boutell Driveaway Company, LLC and Transport Support, LLC, from July 1, 2006 through Sept. 30, 2006. The bankruptcy court scheduled a hearing on Allied's motion beginning June 23, 2006 in Atlanta. "Current managers at Allied have failed job one in the trucking industry and the Teamsters national negotiating committee as well as many of our affected members will oppose this latest attack against our contract at the court in Atlanta," Teamsters General President James P. Hoffa said. "Intentional neglect of the operating fleet in order to pay non-productive and exorbitant turnaround fees and bonuses totaling multi-millions of earned revenue dollars is unacceptable." Teamsters Authorize Strike Teamster drivers, yard personnel and maintenance employees perform skilled and dedicated professional service in a physically demanding, time-sensitive industry. On June 10 and 11, members working at Allied in the jurisdictions of Local 89, Louisville, Kentucky; Local 327, Nashville, Tennessee; Local 957, Dayton, Ohio; Local 299, Detroit, Michigan; Local 355, Baltimore, Maryland; Local 961, Denver, Colorado; Local 391, Greensboro, North Carolina attended specially-called meetings. Members at the meetings showed unanimous support for a resolution authorizing strike action if Allied uses the bankruptcy court to reject and void Allied's participation in the National Master Automobile Transporters Agreement and Supplements. These authorizations follow the similar support received from the members of Local 332 in Flint, Michigan on June 4. "It is obvious to all industry employees that Allied's current management has breached the basic covenant between management and Teamster labor under the NMATA," Fred Zuckerman, Director of the Teamsters Carhaul Division, said. 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. Henry S. Miller at Miller Buckfire & Co., LLC, serves as the Debtors' financial advisor. Anthony J. Smits, Esq., at Bingham McCutchen LLP, provides the Official Committee of Unsecured Creditors with legal advice and Russell A. Belinsky at Chanin Capital Partners, LLC, provides financial advisory services to the Committee. When the Debtors filed for protection from their creditors, they estimated more than $100 million in assets and debts. ALLIED PRINTING: Judge Funk Rules Equipment Deal Is a Lease ----------------------------------------------------------- The Honorable Jerry A. Funk was called on to decide whether agreement between Creo Financial Services (a Financing Program of Fleet Business Credit, LLC) and Allied Printing, Inc., is a financing agreement or a true lease. If it's a financing agreement, Fleet wants adequate protection payments under 11 U.S.C. Sec. 361 to compensate it for diminution in the value of two pieces of equipment (a Lotem 800 Quantum and a Trendsetter 800 Quantum) used to make printing plates. If it's a lease, Fleet wants the Debtor to decide under 11 U.S.C. Sec. 365 whether to assume, assume and assign, or reject the agreement. Fleet says the deal is a true lease. The Debtor says the deal is a disguised financing transaction. The document evidencing the agreement is called a "Master Lease Agreement" and requires 48 monthly payments of $17,207.74. The Debtor's two principals guaranteed Allied Printing's obligations. Creo is the manufacturer of the Equipment. Brian Erwin, a market development manager for Creo remanufactured systems whose primary responsibility is monitoring sales and marketing of used Creo equipment, testified as an expert witness on behalf of Fleet. Mr. Erwin testified that as long as the Equipment is maintained, it should last eight to ten years. Judge Funk decided to use the eight-year estimate. Mr. Erwin testified that as of April, 2007, the Lotem will have an $80,769 value and the Trendsetter 800 will have a value of $106,047. Fleet disclaimed all warranties under the agreement and the Debtor is responsible for the risk of loss of the equipment and is required to pay insurance and taxes on the Equipment. In the event Debtor defaults on its payment and other obligations. Fleet has the right to accelerate all payments due under the agreement, remove and sell the Equipment, and hold the Debtor and guarantors responsible for any deficiency. At the end of the lease term the Debtor may: (1) return the Equipment to Fleet; (2) "extend the Lease term at the then fair rental value for an extension term the length of which shall be determined by agreement between [Debtor] and [Fleet] but in no case shall be less than four (4) months"; or (3) "purchase all of the [Equipment] for cash at the [Equipment]'s then fair market value. In the event Debtor does not renew, it is responsible for the cost of de-installing, shipping and refurbishing the Equipment. Mr. Erwin estimated that the total cost to de-install, ship, and refurbish the Lotem and the Trendsetter is approximately $58,000. In a decision published at 2005 WL 3947958, 19 Fla. L. Weekly B175, Judge Funk finds that under Florida law the transaction created a lease because Fleet retained a meaningful reversionary interest in the equipment. Thus, the debtor is required to assume or reject the agreement prior to confirmation of a chapter 11 plan. Headquartered in Jacksonville, Florida, Allied Printing -- http://www.alliedgraphics.net/and http://www.alliedgraphics.net/ -- provides printing services specializing in high quality color lithography. The company filed for chapter 11 protection on July 2, 2004 (Bankr. M.D. Fla. Case No. 04-06812). Earl M. Barker, Jr., Esq., at Slott & Barker represents the Debtor. When Allied Printing filed for protection from its creditors, it listed $3,373,230 in total assets and $6,099,485 in total debts. AXLETECH INT'L: Moody's Holds Junk Rating on Senior Secured Loan ---------------------------------------------------------------- Moody's Investors Service confirmed the ratings of AxleTech International Holdings, Inc. The action concludes a review for possible downgrade announced on April 10, 2006 following the company's request to its bank group for an extension to the delivery date of its audited financial statement for December 31, 2005. The request was driven by complications associated with multiple stub accounting periods and purchase accounting following the acquisition in October 2005. The company received the requested waiver, completed its audit process, supplied required financial statements to its lenders and is current in its reporting requirements. While performance from the date of the acquisition through the first quarter of 2006 has been slightly below plan, prospectively it remains consistent with Moody's expectations at the time of the initial ratings assignment. One-time expenses and purchase accounting adjustments account for the bulk of variations from original expectations, although working capital needs and corresponding use of the revolving credit in the first quarter of 2006 exceeded anticipated amounts. The company was in compliance with its financial covenants at March 31 with ample headroom. Moody's anticipates AxleTech's prospective debt protection measures will continue in an acceptable range for the B2 Corporate Family rating category and support a stable outlook. Ratings Confirmed: * Corporate Family, B2 * Senior Secured First Lien bank debt, B2 * Senior Secured Second lien term loan, Caa1 AxleTech International Holdings, Inc., headquartered in Troy, Michigan, is a leading supplier of planetary axles, brakes and other drivertrain components and aftermarket for off-highway, military and specialty vehicles. The company has approximately 425 employees with significant operations in Oshkosh, Wisconsin, Belvidere, Illinois, St. Etienne, France, and Osasco, Brazil. BOYDS COLLECTION: Maryland Court Confirms Plan of Reorganization ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Maryland has entered an order confirming the The Boyds Collection, Ltd.'s Plan of Reorganization, which had been overwhelmingly accepted by creditors and interest holders entitled to vote on the Plan. The hearing to consider confirmation of the Plan of Reorganization occurred on June 8, 2006. Boyds is now set to complete its reorganization and emerge from Chapter 11 in late June. "The approved plan and the support given to the Company is great news for all of Boyds' employees, customers and vendors," Jan Murley, chief executive officer and director, said. "Upon emergence, Boyds will be able to put a greater emphasis on its strengthened balance sheet and focus on its financial and operational performance. We are especially grateful for the support of our loyal employees, collectors, customers, and business partners during the reorganization process." As previously reported, following the emergence from Chapter 11, Ms. Murley is leaving Boyds to pursue other interests. Robert Coccoluto, who served as President and CFO of Boyds between 1998 and 2000, will act as CEO following Ms. Murley's departure. "I look forward to leading the Company into the next stage of its development," said Robert Coccoluto, incoming chief executive officer. "Upon emergence we will have an improved capital structure and a stronger, more invigorated Company." As reported in the Troubled Company Reporter on May 16, 2006, the terms of the confirmed Plan are: 1) Holders of Senior Secured Claims will receive for their claims of approximately $57.7 million: senior secured promissory notes in the aggregate principal amount of $30 million, to be due in five years following the Effective Date; and New Common Stock representing approximately 48.5% of the New Common Stock issued on the Effective Date. 2) If the Class of holders of Qualifying Noteholder Claims vote to accept the Plan, then each holder of an Allowed Qualifying Noteholder Claim shall receive Cash in the amount of 22% of the Allowed amount of such Allowed Qualifying Noteholder Claim, to be paid, if at all, on the date upon which a Future Transaction is consummated; plus its Pro Rata Share of 5% of the New Common Stock, plus its Pro Rata Share of 50% of the Reallocated Shares. If the Class of holders of Qualifying Noteholder Claims votes to reject the Plan, then each holder of an Allowed Qualifying Noteholder Claim shall receive its Pro Rata Share of 5% of the New Common Stock, plus its Pro Rata Share of 50% of the Reallocated Shares. 3) If the Class of holders of Non-Qualifying Noteholder Claims vote to accept the Plan, then each holder of an Allowed Non-Qualifying Noteholder Claim shall receive Cash in the amount of 24% of the Allowed amount of such Allowed Non-Qualifying Noteholder Claim to be paid, if at all, on the date upon which a Future Transaction is consummated. If the Class of holders of Non-Qualifying Noteholder Claims votes to reject the Plan, then each holder of an Allowed Non-Qualifying Noteholder Claim shall receive Cash in the amount of 2% of the Allowed amount of such Allowed Non-Qualifying Noteholder Claim, to be paid, if at all, on the date upon which a Future Transaction is consummated. 4) Each holder of an Allowed General Unsecured Claim or Claims will receive Cash equal to 28% of its Allowed General Unsecured Claim or Claims, if the Class accepts the Plan. If the Class of holders of General Unsecured Claims votes to reject the Plan, then each holder of an Allowed General Unsecured Claim shall receive Cash in the amount of 4% of the Allowed amount of such Allowed General Unsecured Claim, to be paid on the earlier of: (a) the date upon which a Future Transaction is consummated; and (b) the first Business Day that is at least 18 months after the Effective Date. 5) Secured Claims other than those of the Senior Secured Claims will be treated either as agreed by the parties or in a manner that reinstates the Secured Claim or provides for payment to the creditor equal to the value of such creditor's collateral. 6) Each holder of an Allowed Other Priority Claim shall receive, on account of and in full and complete settlement, release and discharge of such Allowed Other Priority Claim, (a) Cash equal to the amount of such Allowed Other Priority Claim or (b) such other treatment as to which the Reorganized Debtors and such holder shall have agreed upon in writing in an amount sufficient to render such Allowed Priority Claim not Impaired under section 1124 of the Bankruptcy Code, to be paid on the latest of * the Effective Date (or as soon thereafter as is reasonably practicable), * five Business Days after the Allowance Date for such Other Priority Claim, or * the date on which the Debtors and the holder of such Allowed Other Priority Claim otherwise agree. 7) Allowed Priority Tax Claims will either be paid, at the sole option of the Debtors, (a) on the latter of * the Effective Date (or as soon thereafter as is reasonably practicable), * five Business Days after the Allowance Date with respect to such Allowed Priority Tax Claim; (b) beginning the first anniversary following the Effective Date, Cash payments to be made in equal annual installments, with the final installment being payable no later than the sixth anniversary of the date of the assessment of such Allowed Priority Tax Claim, in an aggregate amount equal to such Allowed Priority Tax Claim, together with interest on the unpaid balance of such claim calculated from the Effective Date through the date of payment at the Applicable Rate; or (c) such other treatment agreed to by the holder of such Allowed Priority Tax Claim and the Debtors. 8) Each holder of an equity interest in Boyds of over 200 shares will receive its pro rata share of 46.5% of the equity of Reorganized Boyds. 9) Each holder of an equity interest in Boyds of less than 200 shares will receive $0.15 per share held by such holder. 10) The Company is also negotiating with one of its Senior Lenders to provide a new $11 million revolver with a $4 million seasonal over-advance option that supports letters of credit and would provide Boyds with access to additional capital to fund post-reorganization operations. About The Boyds Collection Headquartered in McSherrystown, Pennsylvania, The Boyds Collection, Ltd. -- http://www.boydsstuff.com/-- designs and manufactures unique, whimsical and "Folksy with Attitude(SM)" gifts and collectibles, known for their high quality and affordable pricing. The Company and its debtor-affiliates filed for chapter 11 protection on Oct. 16, 2005 (Bankr. Md. Lead Case No. 05-43793). Matthew A. Cantor, Esq., at Kirkland & Ellis LLP represents the Debtors in their restructuring efforts. Houlihan Lokey Howard & Zukin Capital, Inc. serves as the Debtor's financial advisors. The law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP, represents the Official Committee of Unsecured Creditors. FTI Consulting serves as the Committee's financial advisors. As of June 30, 2005, Boyds reported $66.9 million in total assets and $101.7 million in total debts. C-BASS MORTGAGE: Moodys Rates Class B-4 Certificates at Ba1 ----------------------------------------------------------- Moody's Investors Service assigned a rating of Aaa to the senior certificates issued by C-BASS Mortgage Loan Asset-Backed Certificates, Series 2006-CB4 and ratings ranging from Aa1 to Ba1 to the subordinate and mezzanine certificates in the deal. The securitization is backed by adjustable-rate and fixed-rate subprime mortgage loans acquired by 2006-CB4 Trust. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, overcollateralization, excess spread and an interest swap agreement. Moody's expects collateral losses to range from 4.35% to 4.85%. Litton Loan Servicing LP will service the loans. Moody's has assigned Litton Loan Servicing LP its top servicer quality rating as a primary servicer of subprime loans. The complete rating actions: Issuer: 2006-CB4 Trust * Cl. AV-1, Assigned Aaa * Cl. AV-2, Assigned Aaa * Cl. AV-3, Assigned Aaa * Cl. AV-4, Assigned Aaa * Cl. M-1, Assigned Aa1 * Cl. M-2, Assigned Aa2 * Cl. M-3, Assigned Aa3 * Cl. M-4, Assigned A1 * Cl. M-5, Assigned A2 * Cl. M-6, Assigned A3 * Cl. B-1, Assigned Baa1 * Cl. B-2, Assigned Baa2 * Cl. B-3, Assigned Baa3 * Cl. B-4, Assigned Ba1 CAPITALSOURCE COMMERCIAL: Fitch Holds BB Rating on $39 Mil. Notes ----------------------------------------------------------------- Fitch Ratings has affirmed six classes of notes issued by CapitalSource Commercial Loan Trust 2005-1 (CapitalSource 2005-1). These rating actions are effective immediately: -- $18,470,842 class A-1 at 'AAA'; -- $468,750,000 class A-2 at 'AA'; -- $34,071,388 class B at 'AA'; -- $56,217,789 class C at 'A'; -- $34,071,388 class D at 'BBB'; -- $39,182,096 class E at 'BB'. CapitalSource 2005-1 is a collateralized loan obligation (CLO) that closed on April 14, 2005 and is managed by CapitalSource Finance LLC. CapitalSource 2005-1 has a static portfolio of high- yield loans made to middle market U.S. businesses, a majority of which is privately owned. The current portfolio is made up of a majority of senior secured loans, while the remaining portfolio consists of subordinate, unsecured, and B loans. Substitution is limited to defined circumstances not to exceed 20% of the original portfolio balance, but there have been no substitutions of loans to date. The affirmations are the result of unchanged credit enhancement levels since close, due to the pro rata pay structure of the deal. As of the most recent servicer report dated May 21, 2006, approximately 45.5% of the capital structure has been redeemed, leaving $681.4 million in collateral assets to cover $650.8 million in rated liabilities. The weighted average loan rating indicated mild credit deterioration, but this deterioration was well defined within Fitch's expectations. In addition, the loans remain relatively stable, with no loan delinquencies in the current portfolio. The ratings of the class A-1 and A-2 notes address the likelihood that investors will receive full and timely payments of interest, as well as the stated balance of principal by the legal final maturity date, as per the governing documents. The ratings of the classes B, C, D, and E notes address the likelihood that investors will receive ultimate and compensating interest payments, as well as the stated balance of principal by the legal final maturity date, as per the governing documents. Fitch will continue to monitor and review this transaction for future rating adjustments. CARDSYSTEMS SOLUTIONS: Hires Mesch Clark as Bankruptcy Counsel -------------------------------------------------------------- Cardsystems Solutions, Inc., obtained authority from the U.S. Bankruptcy Court for the District of Arizona for permission to hire Mesch, Clark & Rothschild, P.C., as its bankruptcy counsel. As reported in the Troubled Company Reporter on May 19, 2006, Mesch Clark is expected to: (a) give the Debtor legal advise with respect to its powers and duties in the continued operation and management of its property; (b) advise the Debtor and to represent it with regards to general corporate matters, probate, guardianship and conservatorship matters; (c) take necessary action to recover certain property and money owed to the Debtor, if necessary; (d) represent the Debtor in litigation; (e) prepare, on behalf of the Debtor, the necessary application, answers, complaints, order, reports, disclosure statement, plan of reorganization, motions and other legal papers; (f) perform all other legal services that the Debtor deems necessary. Lowell E. Rothschild, Esq., a partner at the firm, discloses that he charges $350 per hour for his services. He added that these firm professionals charge: Professional Hourly Rate ------------ ----------- Michael McGrath $350 Frederick J. Peterson $275 Partners $210 - $350 Associates $190 - $210 Paralegals $125 Law Clerks $ 75 Legal Clerk Assistants $ 75 Mr. Rothschild assures the Court that his firm and its professionals do not hold material interest adverse to the Debtor and are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Sonoita, Arizona, Cardsystems Solutions, Inc. -- http://www.cardsystems.com/-- is a subsidiary of the electronic payment solutions company Pay By Touch Payment Solutions, LLC -- http://www.paybytouch.com/Pay By Touch is a global leader of biometric authentication, loyalty & membership, and provides convenient and secured payment electronic transactions for businesses and consumers. The Company filed for bankruptcy protection on May 12, 2006 (Bankr. D. Ariz. Case No. 06-00515). Frederick J. Petersen, Esq., at Mesch, Clark & Rothschild, P.C., represent the Debtor in its restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in the Debtor's case. When the Debtor filed for bankruptcy protection, it disclosed assets amounting to $13,087,515 and debts totaling $23,860,343. CITATION CORP: High Debt Leverage Prompts S&P to Cut Rating to B- ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Birmingham, Alabama-based Citation Corp. to 'B-' from 'B' because of the company's increasing debt leverage and thin liquidity. Citation, a supplier of automotive and industrial cast parts, has total debt of about $238 million. The outlook is negative. Citation's credit protection measures have weakened since it emerged from bankruptcy in May 2005. Citation has reported weaker-than-expected earnings and cash flow during the first six months of its fiscal 2006 (ending Sept. 30, 2006). Sales have declined because of the competitive challenges of the automotive industry, and profitability has suffered from low volumes and tough pricing. "The company's high debt leverage has put pressure on its liquidity because of the constraints of its strict financial covenant requirements," said Standard & Poor's credit analyst Martin King. Although the company remains in compliance with the covenants, violations are possible in the near term if earnings and cash flow do not improve. Citation's financial results typically strengthen in the second half of its fiscal year. But the competitive pressures facing its largest automotive customers, the domestic car manufacturers, could limit the extent of the improvement, causing earnings and cash flow to remain weak. Citation has a vulnerable business profile, resulting from the cyclical and competitive challenges of the automotive and industrial equipment industries, its high fixed costs, and its exposure to volatile commodity and energy costs. The company's 2004 bankruptcy filing was precipitated by a dramatic rise in the cost of scrap steel when the company was unable to get price increases from its customers. CLECO EVANGELINE: Moody's Ups Rating on Senior Sec. Bonds to Ba2 ---------------------------------------------------------------- Moody's Investors Service upgraded the rating of Cleco Evangeline LLC's senior secured bonds due 2020 to Ba2 from B1, concluding the review for upgrade that was initiated April 5, 2006. Evangeline is a 785 MW natural gas fired generating station located in St. Landry, Evangeline Parish, Louisiana. The rating action for Evangeline is prompted by the recent upgrade of The Williams Companies, Inc.'s long-term senior unsecured ratings to Ba2 from B1, reflecting improvements in Williams' core natural gas businesses. Fundamental to the rating of Evangeline is the fact that Williams guarantees the payments of its subsidiary, Williams Power Company, Inc., under a long-term tolling agreement between WP and Evangeline that expires in 2020. This tolling agreement is the principal source of cash flow for the Evangeline project. The power project, which is located in the overbuilt southeastern U.S., has been dispatched less often than had been originally anticipated. However, the project continues to receive regular capacity payments, which represent the core component of cash flow for debt service, and are based upon the plant's average and peak availability target levels. The rating outlook is stable. Given the historical operating performance of the plant, Moody's anticipates that Evangeline will be able to continue to achieve required availability levels and receive associated capacity payments. Evangeline's ability to cover required debt service obligations has remained robust due to the receipt of these contracted capacity payments. Cleco Evangeline LLC is owned 100% by Cleco Corporation, an electric utility and energy company headquartered in Pineville, Louisiana. COLLINS & AIKMAN: Sells Looms to Petit Textile for $690,000 ----------------------------------------------------------- Collins & Aikman Corporation and its debtor-affiliates will sell to Petit Textile Machinery, Inc., these looms for $690,000: a) 14 Van de Wiele VMM-22 Looms; and b) 8 Van de Wiele MPS-22 Looms. The Debtors will also sell 250 stackable racks to Elgort Textile Associates, Inc., for $6,250. This is the highest offer that the Debtors received for the assets. The assets are being sold "as-is" and "where-is" with no representations and warranties by the Debtors. Headquartered in Troy, Michigan, Collins & Aikman Corporation -- http://www.collinsaikman.com/-- is a global leader in cockpit modules and automotive floor and acoustic systems and is a leading supplier of instrument panels, automotive fabric, plastic-based trim, and convertible top systems. The Company has a workforce of approximately 23,000 and a network of more than 100 technical centers, sales offices and manufacturing sites in 17 countries throughout the world. The Company and its debtor-affiliates filed for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case No. 05-55927). 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. 31; Bankruptcy Creditors' Service, Inc., 215/945-7000) COLLINS & AIKMAN: Court Approves Amended GM Transition Agreement ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Michigan authorized Collins & Aikman Corporation and its debtor-affiliates to enter into an amended agreement with General Motors Corporation regarding the resourcing and transition of a GM program. As reported in the Troubled Company Reporter on May 26, 2006, The Debtors filed, under seal, an Amended Agreement with GM. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, had informed the Court that the sole basis upon which the Court previously sustained the objection filed by the Official Committee of Unsecured Creditors against the resourcing agreement with GM has been consensually resolved by the Debtors, GM, the Committee and the agent to the prepetition senior secured lenders. The Debtors incorporated the resolution into the amended agreement. The Court had previously rejected the Debtors' request to assist GM in resolving commercial and legal issues related to the resourcing and transition of their supply agreements because of a sealed objection submitted by the Creditors' Committee. 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. 31; Bankruptcy Creditors' Service, Inc., 215/945-7000) CONTINENTAL AIRLINES: Upgrades Fleet with 10 New Boeing 787's ------------------------------------------------------------- Continental Airlines ordered 10 additional Boeing 787 Dreamliner aircraft, bringing to 20 the total number of 787s the company has ordered from The Boeing Company and making Continental the largest U.S. customer for Boeing's newest widebody aircraft. In addition, the company will acquire 24 more Boeing Next- Generation 737 (737NG) aircraft, bringing the total number of Boeing 737NGs in its fleet to 213 when these aircraft, and pre- existing firm order 737NG aircraft, are delivered. "These aircraft will give us the ability to seize long-haul market opportunities, remove less efficient aircraft from our fleet and maintain our role as a global network leader," said Larry Kellner, Continental's chairman and CEO. "We continue to target 5 to 7 percent annual growth in capacity. Our fleet plan remains flexible, permitting us to respond appropriately to market conditions." Working together with its valued business partners at Boeing, Continental has been acquiring modern, fuel-efficient aircraft over the past decade, giving the airline a natural fuel hedge and an advantage over its competitors. Since 1998, the company has improved fuel efficiency by nearly 25% per available seat mile as a result of several factors including fleet modernization, implementation of fuel-saving technology like winglets, and improved operating procedures. This new order will bring Continental's firm commitments for new aircraft to 88 (20 Boeing 787s, two Boeing 777s and 66 Boeing 737s). The first of the 20 Boeing 787 aircraft is scheduled for delivery in 2009, and the first additional 737NG will be scheduled for delivery in 2008. Continental Airlines (NYSE: CAL) -- http://continental.com/-- is the world's sixth-largest airline, serving 128 domestic and 111 international destinations -- more than any other airline in the world -- and serving nearly 200 additional points via codeshare partner airlines. With 42,000 mainline employees, the airline has hubs serving New York, Houston, Cleveland and Guam, and carries approximately 51 million passengers per year. * * * As reported in the Troubled Company Reporter on May 29, 2006, Standard & Poor's Ratings Services assigned its 'AAA' preliminary rating to Continental Airlines Inc.'s (B/Negative/B-3) $190 million Class G pass-through certificates, and its 'B+' preliminary rating to the $130 million Class B pass-through certificates. As reported in the Troubled Company Reporter on May 26, 2006, Moody's Investors Service assigned a rating of Aaa to the Class G Certificates and a B1 rating to the Class B Certificates of Continental Airlines, Inc.'s 2006-1 Pass Through Trusts Pass Through Certificates, Series 2006-1. CORNELL COMPANIES: Seeks Advise on Strategic Alternatives --------------------------------------------------------- Cornell Companies, Inc., retained a financial advisor to assist the Company in its analysis and consideration of a range of strategic alternatives to maximize shareholder value. The Company does not intend to make further announcements on the status or results of the assessment process unless and until the Company has made definitive decisions on its future strategic direction. Cornell Companies, Inc. -- http://www.cornellcompanies.com/-- (NYSE:CRN) is a leading private provider of corrections, treatment an educational services outsourced by federal, state and local governmental agencies. Cornell provides a diversified portfolio of services for adults and juveniles, including incarceration and detention, transition from incarceration, drug and alcohol treatment programs, behavioral rehabilitation and treatment, and grades 3-12 alternative education in an environment of dignity and respect, emphasizing community safety and rehabilitation in support of public policy. The Company has 83 facilities in 18 states and the District of Columbia, which includes one facility under construction. Cornell has a total service capacity of 19,506, including capacity for 1,300 individuals that will be available upon completion of the facility under construction. * * * As reported in the Troubled Company Reporter on May 31, 2005, Standard & Poor's Ratings Services lowered its ratings on corrections, treatment, and educational services provider Cornell Companies Inc., including its corporate credit rating to 'B-' from 'B'. CRESCENT JEWELERS: Wants Until August 29 to Decide on Leases ------------------------------------------------------------ Crescent Jewelers asks the U.S. Bankruptcy Court for the Northern District of California to extend, until August 29, 2006, the period in which it can elect to assume, assume and assign, or reject non-residential real property leases. The Debtor reminds the Court that the leases of approximately 97 of its current 103 stores are subject to assumption or rejection. The Debtors say that the store leases provide for the payment of lease rentals plus real estate taxes, insurance, common area maintenance fees, mall association dues, or contingent rentals based on the store's gross sales. The Debtor tells the Court that without the benefit of the leases, it would: * be incapable of conducting its retail business, * lose the value of the goodwill that it has developed in the retail market, and * lose any equity in the leases and its valuable leasehold improvements on the leased premises. The Debtor cites four reasons why the extension is warranted: 1. the Debtor's chapter 11 case is large and complex and there is large number of leases involved; 2. the leases are among the primary assets of the Debtor; 3. the Debtor will satisfy its postpetition rental obligations; and 4. the Lessors will not be prejudiced by the extension. Headquartered in Oakland, California, Crescent Jewelers, Inc. -- http://www.crescentonline.com/-- sells jewelry and operates over 160 stores in six western states. The Company filed for chapter 11 protection on August 11, 2004 (Bankr. N.D. Cal. Case No. 04- 44416). Lee R. Bogdanoff, Esq. at Klee, Tuchin, Bogdanoff and Stern represents the Debtor in its chapter 11 case. John D. Fiero, Esq., Kenneth H. Brown, Esq., and Tobias S. Keller, Esq., at Pachulski, Stang, Ziehl, Young and Jones represent the Official Committee of Unsecured Creditors. In its April 2006 Monthly Operating Report, the Debtor reported $77,372,000 in total assets and $134,972,000 in total debts. CUMULUS MEDIA: Inks $850 Million Revolving Credit Deal with BofA ----------------------------------------------------------------- Cumulus Media Inc. entered into a Credit Agreement, dated as of June 7, 2006, with Bank of America, N.A., as administrative agent, Banc of America Securities LLC and Wachovia Capital Markets, LLC, as joint lead arrangers and joint bookrunners, Wachovia Bank, National Association, as syndication agent. The Credit Agreement consists of: * a revolving credit facility of $100 million and * a term loan facility in the aggregate principal amount of $750 million. The proceeds are expected to be used by the Company to repay all amounts outstanding under its existing credit facilities (approximately $588.2 million) and, as previously announced, to purchase up to 11.5 million shares of the Company's Class A Common Stock pursuant to its "Dutch auction" tender offer commenced on May 17, 2006, to purchase up to 5 million shares of the Company's Class B Common Stock pursuant to a stock purchase agreement, dated May 9, 2006, by and among the Company, BA Capital Company, L.P. and Banc of America Capital Investors SBIC, L.P. The remaining proceeds are expected to be used to provide ongoing working capital, which may include the funding of future acquisitions of radio stations, and for other general corporate purposes, including capital expenditures. The Credit Agreement also provides for additional, incremental revolving credit or term loan facilities in an aggregate principal amount of up to an additional $200 million, subject to the satisfaction of certain conditions. These incremental credit facilities are permitted from time to time, and may be used to fund future acquisitions of radio stations and for other general corporate purposes, including capital expenditures. Any incremental credit facilities will be secured and guaranteed on the same basis as the term loan and revolving credit facility. The Company's obligations under the Credit Agreement are collateralized by substantially all of its assets in which a security interest may lawfully be granted, including, without limitation, intellectual property and all of the capital stock of the Company's direct and indirect domestic subsidiaries (except for Broadcast Software International, Inc.) and 65% of the capital stock of certain first-tier foreign subsidiaries. In addition, the Company's obligations under the Credit Agreement will be guaranteed by certain of its subsidiaries. Funding under the Credit Agreement is subject to conditions customary for financing transactions of this nature, and also is subject to the additional condition that shares of Class A Common Stock have been accepted for payment in the tender offer. The term loan facility will mature on June 7, 2013 and will amortize in equal quarterly installments beginning on September 30, 2006, with 0.25% of the initial aggregate advances payable each quarter during the first six years of the term, and 23.5% due in each quarter during the seventh year. The revolving credit facility will mature on June 7, 2012 and, except at the option of the Company, the commitment will remain unchanged up to that date. Borrowings under the term loan facility will bear interest, at the Company's option, at a rate equal to LIBOR plus 2.0% or the Alternate Base Rate (defined as the higher of the Bank of America Prime Rate and the Federal Funds rate plus 0.50%) plus 1.0%. Borrowings under the revolving credit facility will bear interest, at the Company's option, at a rate equal to LIBOR plus a margin ranging between 0.675% and 2.0% or the Alternate Base Rate plus a margin ranging between 0.0% and 1.0% (in either case dependent upon the Company's leverage ratio). Certain mandatory prepayments of the term loan facility will be required upon the occurrence of specified events, including upon the incurrence of certain additional indebtedness and upon the sale of certain assets. The representations, covenants and events of default in the Credit Agreement are substantially the same as those in the Company's existing credit agreement, and are customary for financing transactions of this nature. About Cumulus Media Headquartered in Atlanta, Georgia, Cumulus Media Inc. (NASDAQ:CMLS) -- http://www.cumulus.com/-- is the second-largest radio company in the United States based on station count. Giving effect to the completion of all pending acquisitions and divestitures, Cumulus Media Inc., directly and through its investment in Cumulus Media Partners, will own and operate 343 radio stations in 67 U.S. media markets. * * * As reported in the Troubled Company Reporter on May 26, 2006, Standard & Poor's Ratings Services lowered its ratings on Cumulus Media Inc., including lowering the corporate credit rating to 'B' from 'B+'. The ratings were removed from CreditWatch, where they were placed with negative implications on May 11, 2006. The outlook is stable. As reported in the Troubled Company Reporter on May 24, 2006, Moody's Investors Service downgraded Cumulus Media, Inc.'s corporate family rating to a Ba3 from a Ba2. Additionally, Moody's assigned Ba3 ratings to the company's $850 million in amended senior secured credit facilities. DELPHI CORP: MobileAria Auction Scheduled for July 10 ----------------------------------------------------- Delphi Corporation and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to: (a) approve the Bidding Procedures, the Bid Protections, the form and manner of sale notices, and the setting of the Sale Hearing related to the proposed sale of MobileAria, Inc.; and (b) approve (i) the Sale of the Assets free and clear of liens, claims, and encumbrances to Wireless Matrix or to the Successful Bidder; (ii) the assumption and assignment of certain contracts and unexpired leases related to MobileAria to Wireless Matrix or the Successful Bidder; and (iii) the assumption of certain liabilities by Wireless Matrix or the Successful Bidder. MobileAria, one of the Debtors, was founded in 2000 and is a service provider of mobile resource management solutions. MobileAria enables high-speed data connection between mobile resources and an enterprise's IT infrastructure. In 2005, MobileAria won a 20,000-unit, five-year service contract from Verizon Services Corp. The Debtors believe that MobileAria is a strong business in an emerging and rapidly growing market but its business does not present a strong fit within their anticipated product portfolio under their transformation plan. In this regard, the Debtors and MobileAria have decided that its value will be maximized by divesting its assets. In March 2006, MobileAria hired Pagemill Partners LLC to help the company in analyzing a sale of its assets or a merger with a strategic partner. Pagemill is a technology-focused investment bank in the Silicon Valley region of California with extensive transactional experience focusing on emerging and middle-market transactions. Pagemill identified potential bidders for MobileAria based on strategic fit and financial characteristics. On May 24, four potential bidders submitted proposals to acquire MobileAria's assets. MobileAria, with Pagemill and other advisors, evaluated those proposals as well as the benefits of other alternatives. After the evaluation, MobileAria concluded that Wireless Matrix USA's proposal offered the most advantageous terms and the greatest economic benefit. The parties agree that MobileAria will sell its assets to Wireless Matrix for $6,500,000, $975,000 of which will be placed into an escrow account to satisfy indemnification obligations. The remaining available funds from the escrow are to be released on the first anniversary of the date of closing. The Sale is subject to higher or otherwise better offers pursuant to certain Bidding Procedures. MobileAria will be required to pay Wireless Matrix a Break-Up Fee equal to 3% of the purchase price if MobileAria sells the Assets to another bidder. Pursuant to the Bidding Procedures, qualified bidders must submit their bids by June 29, 2006. All bids must include a good faith deposit of $500,000, among other necessary documents. Qualified bids must have a value greater than the Wireless Matrix's purchase price plus the amount of the Break-Up Fee plus $400,000. MobileAria will conduct an auction at 10:00 a.m. (prevailing Eastern time) on July 10, 2006. MobileAria asks the Court to schedule a sale hearing on July 19, 2006. If no Qualified Bids are received, MobileAria will proceed with the sale of the Assets to Wireless Matrix. John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, explains that although MobileAria is a technology leader and remains poised for significant growth, its growth requires cash infusions. The Debtors' current financial condition has put a strain on MobileAria's potential future growth, Mr. Butler says. Because of MobileAria's current cash needs and the Debtors' desire to focus available free cash on investments in business lines that are more likely to comprise their restructured product portfolio, a sale should be made promptly to avoid a risk of value erosion, Mr. Butler says. A full-text copy of the Bidding Procedures is available for free At http://ResearchArchives.com/t/s?b56 About Delphi Corporation Troy, Mich.-based, Delphi Corporation -- http://www.delphi.com/ -- is the single largest global supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The Company's technology and products are present in more than 75 million vehicles on the road worldwide. The Company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530 in total assets and $22,166,280,476 in total debts. (Delphi Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service, Inc., 215/945-7000) DELPHI CORP: Wants Until February 2007 to File Chapter 11 Plan -------------------------------------------------------------- Delphi Corporation and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to further extend: (a) their exclusive period to file a plan of reorganization through February 1, 2007; and (b) their exclusive period to solicit acceptances of that plant through April 2, 2007. The sheer size and complexity of the Debtors' cases alone justifies an extension of the Exclusive Periods, John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, says. Mr. Butler adds that the Debtors' cases are further complicated by their long history with General Motors Corporation and the disadvantageous labor contracts they inherited from their former parent. According to Mr. Butler, the Debtors must address numerous issues including the re-pricing of parts supplied to GM and the litigation and negotiations with the labor unions to reduce legacy liabilities and eliminate restrictions that prevent the Debtors from exiting non-strategic, non-profitable operations. The Debtors require more time to position their businesses to execute the transformation plan and formulate, promulgate, and build consensus for a plan of reorganization, Mr. Butler says. Mr. Butler clarifies, however, that the Debtors have made great strides in reaching their goal of completing the restructuring process. The Debtors have focused on five key areas: Key Area Progress -------- -------- Modifying labor contracts Litigation has commenced in to create a competitive connection with the Debtors' arena in which to conduct motions under Sections 1113/1114 business going forward. of the Bankruptcy Code seeking authority to reject U.S. labor agreements and to modify retiree benefits. On a parallel track, the Debtors continue to negotiate with their unions in an attempt to reach a consensual resolution. Attempting to conclude On March 31, 2006, the Debtors Negotiations with GM to filed their initial motion to finalize its financial reject unprofitable supply support and to ascertain contracts with GM. On June 5, GM's business commitment 2006, GM filed its supplemental to Delphi going forward. objection to the rejection. Discussions surrounding the Debtors' motion have been ongoing. Negotiations about forward looking revenue commitments are also in process. Streamlining Delphi's Delphi announced which of its product portfolio to product lines have been deemed capitalize on Delphi's "core" and "non-core," which technology and market will be sold or wound-down. strengths, and make the new necessary marketing alignment with this new focus. Transforming Delphi's Delphi announced reductions it salaried workforce to will be making in the size of ensure that Delphi's its salaried workforce and organizational and cost benefits provided to these structure is competitive employees. and aligned with its product portfolio and manufacturing footprint. Devising a workable The Debtors intend to freeze the solution to Delphi's current hourly U.S. pension plan current pension as of October 1, 2006, and the situation. current U.S. salaried pension plan as of January 1, 2007. The Debtors anticipate that both plans will be replaced with defined contribution plans. "The Debtors are clearly making good faith progress towards their reorganization," Mr. Butler says. "Nevertheless there is still significant progress to be made." About Delphi Corporation Troy, Mich.-based, Delphi Corporation -- http://www.delphi.com/ -- is the single largest global supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The Company's technology and products are present in more than 75 million vehicles on the road worldwide. The Company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530 in total assets and $22,166,280,476 in total debts. (Delphi Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service, Inc., 215/945-7000) DELTA MILLS: Amends Terms of $40 Million GMAC Credit Facility ------------------------------------------------------------- Delta Mills, Inc., entered into an amended and restated credit facility with GMAC Commercial Finance, LLC, as agent and as lender, on May 30, 2006. Delta Mills' factoring arrangement with GMAC was also amended and restated, including an extension of its term to May 30, 2009. The credit facility consists of a $40 million credit facility, of which up to $9 million may potentially be advanced as term loans. The facility will terminate on May 30, 2009, and earlier prepayment and termination will generally require the payment of a premium. The maximum revolving loan amount is the lesser of $40 million, as reduced by the $9 million term loan maximum amount until the end of the term loan commitment period, and by the amount of any outstanding term loans and a borrowing base calculation consisting of -- up to 90% of eligible accounts receivable; and -- up to the lesser of 50% of the lower of cost or market of eligible inventory or $15 million, less: a) an availability block of up to $7 million, and less b) such reserves as are determined from time to time by GMAC. If any term loans are outstanding, the amount of those term loans will create an additional reserve against the borrowing base. The revolving credit facility includes a $2 million sublimit for letters of credit. Proceeds of revolving loans may be used for working capital purposes and general corporate purposes and to pay for the fees and expenses of the transaction. Revolving loans will bear interest at prime plus 2.75% per annum. The purpose of the term loan facility is to fund purchases of Delta Mills' 9-5/8% Senior Notes due 2007. The maximum amount of outstanding term loans is $9 million. Term loans will bear interest at prime plus 4% per annum. The term loan facility includes a multiple draw feature with the proceeds to fund purchases of Senior Notes at a discount satisfactory to GMAC, and term loans may be prepaid without penalty (but may not be re- borrowed) under the terms of the credit facility. Any permitted draws under the term loan facility must be made prior to the end of the term loan commitment period, which extends to the earlier of March 31, 2007, and the date on which all Senior Notes have been repurchased. Term loans will amortize monthly based on a five-year level principal amortization schedule. The amount of outstanding term loans forms a reserve against Delta Mills' borrowing base. The amended and restated credit agreement includes provisions relating to the grant of liens to the agent in additional personal and real property assets of Delta Mills. However, because this grant was conditioned on the consummation of the offer to purchase Senior Notes that commenced on April 17, 2006, and the Offer was not consummated, these provisions are currently without effect. The amended and restated credit agreement contains minimum 12- month trailing EBITDA requirements, as well as restrictions on future stock repurchases, dividends, capital expenditures, investments and sales of assets. In certain circumstances, proceeds of assets sales will be required to repay outstanding amounts under the credit facility. Events of default under the credit facility include the circumstance of any Senior Notes remaining outstanding on March 31, 2007, as well as other standard events of default. A copy of the amended and restated credit agreement is available for free at http://researcharchives.com/t/s?b52 About Delta Mills Delta Mills, Inc., a wholly owned subsidiary of Delta Woodside Industries, Inc. (OTCBB:DLWI) -- http://www.deltawoodside.com/-- produces a broad range of finished apparel fabrics in four manufacturing plants in South Carolina. Delta Mills sells and distributes its fabrics through a marketing office in New York City, with sales agents also operating from Atlanta, Chicago, Dallas, Los Angeles, San Francisco and Mexico. * * * Going Concern Doubt KPMG LLP in Greenville, South Carolina, raised substantial doubt about Delta Mills, Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended July 2, 2005. The auditor pointed to the Company's recurring losses from operations and uncertainties with regard to its ability to operate within the covenants and availability established by its revolving credit facility with GMAC Commercial Finance LLC. DIVERSIFIED FIN.: March 31 Balance Sheet Upside Down by $1.7 Mil. ----------------------------------------------------------------- Diversified Financial Resources Corp. filed its 1st quarter financial statements for the three months ended March 31, 2006, with the Securities and Exchange Commission. The Company earned $9,159 in net income on zero revenue for the three months ended March 31, 2006. At March 31, 2006, the Company's balance sheet showed $200,785 in total assets, $1,901,566 in total current liabilities, and a $1,700,781 stockholders' deficit. The Company's March 31, 2006, balance sheet also reported that the Company had an accumulated deficit of $21,030,164. Full-text copies of the Company's financial statements for the three months ended March 31, 2006, are available for free at http://researcharchives.com/t/s?b3c Going Concern Doubt Mendoza Berger & Company, LLP, in Irvine, California, raised substantial doubt about Diversified Financial's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Dec. 31, 2005. The auditor pointed to the Company's significant and recurring losses. About Diversified Financial Headquartered in San Diego, California, Diversified Financial Resources Corporation is currently a holding company with real estate investment operations. The Company's plan is to create and manage a diverse comprehensive portfolio of companies operating in several industries. Currently, Diversified Financial is focusing its resources on two industry sectors, including Land and Natural Resources and Real Estate Investments. The Company is currently in the process of fully developing its business plan. ENTI INC: Case Summary & 44 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Enti, Inc. 8040 East Gary Road Scottsdale, Arizona 85260 Tel: (480) 948-8686 Bankruptcy Case No.: 06-01718 Debtor-affiliates filing separate chapter 11 petitions on June 13, 2006: Entity Case No. ------ -------- Entertainment 2000, LLC 06-01741 Enti Capital, LLC 06-01743 Sierra Vista 3033, LLC 06-01744 Debtor-affiliates that filed separate chapter 11 petitions on June 8, 2006: Entity Case No. ------ -------- Peak Enti, LLC 06-01702 Global Grounds Greenery, LLC 06-01701 Type of Business: William J. Galyon, Jr. is the sole shareholder and president of the Debtors. Chapter 11 Petition Date: June 9, 2006 Court: District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtors' Counsel: Alan A. Meda, Esq. Stinson Morrison Hecker LLP 1850 North Central Avenue, Suite 2100 Phoenix, Arizona 85004 Tel: (602) 279-1600 Fax: (602) 240-6925 Estimated Assets Estimated Debts ---------------- --------------- Enti, Inc. $100,000 to $10 Million to $500,000 $50 Million Peak Enti, LLC $1 Million to $500,000 to $10 Million $1 Million Global Grounds Less than $500,000 to Greenery, LLC $50,000 $1 Million Entertainment 2000, LLC $10 Million to $10 Million to $50 Million $50 Million Enti Capital, LLC Less than $10 Million to $50,000 $50 Million Sierra Vista 3033, LLC $100,000 to Less than $500,000 $50,000 A. Enti, Inc., Entertainment 2000, LLC, and Sierra Vista 3033, LLC's list of their 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Alexander Henry Wick Trust Lawsuits: Unknown Paul A. Conant, Esq. 06-000478, 06-001752 2398 East Camelback Road 06-003939, 06-003534 Suite 925 06-004717 Phoenix, Arizona 85016-9002 Alyssa Wick Trust Lawsuits: Unknown Paul A. Conant, Esq. 06-000478, 06-001752 2398 East Camelback Road 06-003939, 06-003534 Suite 925 06-004717 Phoenix, Arizona 85016-9002 Torsha S. Baker - Trust Lawsuits: Unknown Martin R. Galbut, Esq. 06-000478, 06-001752 2398 East Camelback Road 06-003939, 06-003534 Suite 1020 06-004717 Phoenix, Arizona 85016-4216 Barbara Ann Wick Trust Lawsuits Unknown BDL Foundation Lawsuits Unknown The Bidstrup Foundation Lawsuits Unknown G. Peter Bidstrup Lawsuits Unknown Bralu, LLC Lawsuits Unknown Gail L. Bryan Lawsuits Unknown Bryan, Gail Lynn, Lawsuits Unknown Charitable Lead Ann II Bryan, Gail Lynn, Lawsuits Unknown Charitable Lead Annuit Mark Bryan Lawsuits Unknown CDT Investments, Inc. Lawsuits Unknown Contributory IRS Lawsuits Unknown Account of Bidstrup Cameron Danis Lawsuits Unknown Delafield Entity Lawsuits Unknown Development, LLC Gates-04, LLC Lawsuits Unknown Gates-95, LLC Lawsuits Unknown Glory Be LLC Lawsuits Unknown Brooke Susan Hart Lawsuits Unknown B. Peak Enti, LLC and Global Grounds Greenery, LLC's list of their Four Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hebert Schenk P.C. Attorney's Fees Unknown 4742 North 24th Street Suite 100 Phoenix, AZ 85016-4859 Lunds, Danis, WSL, et. Al. Lawsuit Unknown c/o Martin R. Galbut, Esq. 2425 East Camelback Road Suite 1020 Phoenix, AZ 85016-4216 Peter S. Davis Lawsuit Unknown Simon Consulting LLC 3200 North Central Avenue Suite 850 Phoenix, AZ 85012 Simpsons; Simpson Trust Lawsuit Unknown Bryans c/o Brian Cabianca, Esq. 40 North Central Avenue Suite 2700 Phoenix, AZ 85004-4440 C. Enti Capital, LLC's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Harriet D. Brewster Promissory Note $5,850,000 Foundation Robert J. Rosepink, Trustee 7373 North Scottsdale Road Suite E200 Scottsdale, AZ 85253 Marsh Family Trust Promissory Note $4,000,000 C. Douglas & Patricia A. Marsh 11884 East Charter Oak Cir. Scottsdale, AZ 85259 Ashley Limited Switzerland Promissory Note $3,539,965 Peter McQuaid 9785 East Miramonte Scottsdale, AZ 85262 TH-98R, LLC Promissory Note $3,400,000 c/o 301 East Virginia Avenue Suite 3300 Phoenix, AZ 85004-1218 Gates-04, LLC Promissory Note $2,580,000 c/o 301 East Virginia Avenue Suite 3300 Phoenix, AZ 85004-1218 Sights & Sounds LLC Promissory Note $2,108,500 Sallye B. Schumacher 8101 North Mummy Mountain Road Paradise Valley, AZ 85253 Invest-97, LLC Promissory Note $1,720,000 c/o 301 East Virginia Avenue Suite 3300 Phoenix, AZ 85004-1218 Gail Lynn Bryan CLAT - II Promissory Note $1,000,000 Gail L. Bryan, Trustee 22 Biltmore Estates Phoenix, AZ 85016 Virginia M. Simpson Promissory Note $1,000,000 Family Trust Harold A. Simpson 6378 Camino De La Costa La Jolla, CA 92037 Gates-95, LLC Promissory Note $900,000 c/o 301 East Virginia Avenue Suite 3300 Phoenix, AZ 85004-1218 McQuaid, Peter & First Promissory Note $785,187 International Bank & Trust Peter McQuaid IRA 9785 East Miramonte Drive Scottsdale, AZ 85262 Greening 1999 Charitable Promissory Note $750,000 Remainder Trust 7373 North Scottsdale Road Suite E200 Scottsdale, AZ 85253 Silverlynx Development LLC Promissory Note $650,000 Lawrence W. Crawford 6861 Terre Vista Tucson, AZ 85750 Manuel N. and Promissory Note $600,000 Sandra J. Rodriquez Revocable Trust M. Rodriquez, Trustee 10401 North 100th Street Suite #7 Scottsdale, AZ 85258 Barbara and Henry Wick III Promissory Note $550,000 6601 East Indian Bend Road Scottsdale, AZ 85253 OSC-95, LLC Promissory Note $540,000 c/o 301 East Virginia Avenue Suite #3300 Phoenix, AZ 85004-1218 Donald A. Simpson CLAT Promissory Note $500,000 Gail L. Bryan, Trustee 22 Biltmore Estates Phoenix, AZ 85016 Gail Lynn Bryan CLAT - I Promissory Note $500,000 Gail L. Bryan, Trustee 22 Biltmore Estates Phoenix, AZ 85016 Rhode Island LLC Promissory Note $500,000 Robert J. Rosepink 7373 North Scottsdale Road Suite 3200 Scottsdale, AZ 85253 Robert W. Simpson CLAT Promissory Note $500,000 Gail L. Bryan, Trustee 22 Biltmore Estates Phoenix, AZ 85016 EVANS INDUSTRIES: U.S. Trustee Reconstitutes Official Committee --------------------------------------------------------------- R. Michael Bolen, the U.S. Trustee for Region 5, informed the U.S. Bankruptcy Court for the Eastern District of Louisiana that he has reconstituted the Official Committee of Unsecured Creditors in Evans Industries, Inc.'s chapter 11 case. Mr. Bolen says that this was due to the resignation from the Committee of American Flange & Mfg. Co., Inc., and the addition of SK Global America, Inc., Creditor Trust. The Committee is now composed of: 1. Entergy Louisiana LLC Attn: Jon Majewski 4809 Jefferson Highway Mail Unit L-JEF-359 Jefferson, Louisiana 70121 2. Paul T. Gariepy, Jr., CPA 17 Poplar Drive Covington, Louisiana 70433-4327 3. SK Global America, Inc., Creditor Trust Attn: Craig Sheldon, Esq., Counsel c/o Krebs, Farley & Pelleteri, PLLC Matt Farley, Esq. Thomas Beh, Esq. Shashauna M. Dermody, Esq. Attorneys for SK Global 400 Poydras Street, Suite 2500 New Orleans, LA 70130 Headquartered in Harvey, Louisiana, Evans Industries, Inc. -- http://www.evansindustriesinc.com/-- manufactures and distributes steel drums. The company filed for chapter 11 protection on Apr. 25, 2006 (Bankr. E.D. La. Case No. 06-10370). Eric J. Derbes, Esq., and Melanie M. Mulcahy, Esq., at The Derbes Law Firm, LLC, represent the Debtor. C. Davin Boldissar, Esq., at Locke Liddell & Sapp, LLP, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets between $500,000 and $1 million and debts between $10 million and $50 million. EVANS INDUSTRIES: Court Establishes July 5 as Claims Bar Date ------------------------------------------------------------- The Hon. Jerry A. Brown of the U.S. Bankruptcy Court for the Eastern District of Louisiana set 4:30 p.m. on July 5, 2006, as the deadline for all creditors owed money by Evans Industries, Inc., on account of claims arising prior to April 25, 2006, to file their proofs of claim. Creditors must file written proofs of claim on or before the July 5 Claims Bar Date and those forms must be delivered to: Clerk, United States Bankruptcy Court Eastern District of Louisiana 500 Poydras Street, Suite B-601 New Orleans, Louisiana, 70130 Headquartered in Harvey, Louisiana, Evans Industries, Inc. -- http://www.evansindustriesinc.com/-- manufactures and distributes steel drums. The company filed for chapter 11 protection on Apr. 25, 2006 (Bankr. E.D. La. Case No. 06-10370). Eric J. Derbes, Esq., and Melanie M. Mulcahy, Esq., at The Derbes Law Firm, LLC, represent the Debtor. C. Davin Boldissar, Esq., at Locke Liddell & Sapp, LLP, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets between $500,000 and $1 million and debts between $10 million and $50 million. EXIDE TECHNOLOGIES: District Court Adjusts Fine Payment Schedule ---------------------------------------------------------------- The U.S. District Court for the Southern District of Illinois issued an order modifying the payment schedule for the prior fine imposed in February 2002 against Exide Illinois, Inc., a subsidiary of Exide Technologies, and adopting an agreement and joint resolution extending and modifying payments under Exide Illinois, Inc.'s pre-existing $27.5 million fine. Exide Technologies is ultimately responsible for payment of the fine. The Court's order resolves all issues raised in the government's motion filed in November 2005. A copy of the District Court's order is available for free at http://researcharchives.com/t/s?b3f A copy of the agreement and joint resolution incorporated by reference in the District Court's order is available for free at http://researcharchives.com/t/s?b40 About Exide Headquartered in Princeton, New Jersey, Exide Technologies (NASDAQ: XIDE) -- 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. 84; 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+'. S&P also lowered Exide's senior secured rating on its first-lien credit facility to 'CCC' from 'B-' and second-lien notes to 'CC' from 'CCC'. FRESENIUS AG: Fitch Rates Senior Unsecured Debt at BB ----------------------------------------------------- Fitch Ratings assigned ratings to entities in the Germany-based healthcare group, Fresenius, and their respective debt instruments: Fresenius AG: -- senior unsecured debt rating 'BB' -- Issuer Default rating 'BB'/Stable Outlook -- Short-term rating 'B' Fresenius Finance B.V.: -- senior unsecured debt rating for the guaranteed senior notes 'BB' Fresenius Medical Care AG & CO. KGaA: -- senior unsecured debt rating 'BB' -- IDR 'BB'/Stable Outlook -- Short-term rating 'B' Fresenius Medical Care Capital Trusts: -- senior subordinated rating for the guaranteed trust preferred securities 'B+' The ratings reflect: * Fresenius' excellent market positioning in the non-cyclical, steady growth dialysis market; * its vertical integration; and * relatively predictable cash flow generation. The ratings are also supported by the company's good geographical diversification and management's commitment to reduce leverage significantly by 2008. Conversely, the ratings are constrained by: * Fresenius' over-reliance on just one disease area; * its exposure to private insurers' and governments' reimbursement policies; * high leverage; and * integration risk following the recent acquisition of Renal Care Group. As the largest globally operating dialysis service and product provider Fresenius Medical Care benefits from a broad network of dialysis clinics, which enables physicians to refer their patients to conveniently located clinics, as patients generally seek treatment at a dialysis centre near their homes and their nephrologist practices. Cost advantages compared to peers, such as DaVita, are derived from the company's vertical integration as the company also develops and manufactures hemodialysis and peritoneal dialysis machines together with dialysers and filters to clean a patient's blood. Fresenius is over-reliant on dialysis as 71% of group EBITDA is derived from this segment. This is somewhat mitigated by its geographical diversification, thereby reducing the company's reliance on single health care systems. Such a concentrated exposure to one treatment area exposes the group to potential substitution and technology changes. Fresenius' EBITDA margin has remained fairly stable at above 16% since 2002 (16.3% in FY05), with Fresenius Medical Care's EBITDA margins between 17%-18% since 2002 and Pro Serve's margins between 6%-7% (before exceptional costs) during this period. Its Kabi business, however, has consistently improved its EBITDA margin from 10.7% in 2001 to 18.9% in 2005. After completion of the recent Renal Care and Helios (German private hospitals) acquisitions, pro forma lease-adjusted net debt/EBITDAR is 4.7x at the consolidated group level. The group is, however, committed to reduce net debt/ EBITDA to below 3x by 2008. At YE05, operating EBITDAR/net interest plus rents stood at 3.1x (FY04: 2.8x), although this would weaken to 2.5x pro-forma. Fresenius AG generated in FY05 only 37% of the group's cash flow from its operations (EUR280 million), which means that the group's debt service depends to some degree on Fresenius Medical Care's dividends and payments for services and leases to Fresenius. While Fresenius' Kabi business is expected to remain highly cash generative, ProServe's cash flows are likely to remain weak due to capital expenditure requirements and planned acquisitions. GEORGIA GULF: Planned Royal Group Buy Prompts S&P's Negative Watch ------------------------------------------------------------------ Standard & Poor's Ratings Services placed its ratings on Atlanta, Georgia-based Georgia Gulf Corp. on CreditWatch with negative implications. The corporate credit rating on Georgia Gulf is 'BB+'. The CreditWatch action follows Georgia Gulf's announcement of an agreement to acquire all of the common stock of Woodbridge, Ontario-based Royal Group Technologies Ltd. (BB/Watch Neg/--) for approximately C$1.7 billion, including C$491 million of assumed net debt. The acquisition will be funded entirely with debt and is subject to regulatory and shareholder approval. Standard & Poor's will resolve the CreditWatch listing when the transaction closes, which is expected by September 2006. "The acquisition reflects a departure from Georgia Gulf's existing financial policies, and will result in a significant increase in debt leverage and the deterioration of the financial profile beyond expectations at the current ratings," said Standard & Poor's credit analyst Paul Kurias. The increased financial risk is likely to be only partially offset by the benefits of greater integration along the important vinyls chain. Georgia Gulf's existing businesses are viewed as a good strategic fit with Royal Group's fabricated vinyl product business for which vinyl resin is a key raw material. "Nonetheless, lower ratings, perhaps by more than one notch, are likely in the near term, as the immediate implications of higher leverage, and uncertainty related to the integration of a relatively large acquisition, will likely result in weaker credit quality," said Mr. Kurias. Pro forma for the transaction, initial total debt (including the capitalized value of operating leases) to EBITDA is about 4.6x, an increase from March 31, 2006, levels of about 1.5x. In addition, the reliance on debt raises uncertainty with regard to future financial policy, a key issue to be reviewed as part of the CreditWatch resolution. S&P will also reevaluate the business profile to recognize the benefits of a greater emphasis on value- added products, the potential for lower vulnerability to business cycles, and potential improvements to cost position from purchasing and manufacturing synergies and from restructuring efforts. Royal Group is a leading North American manufacturer of custom vinyl window profiles. Other key products include PVC exterior cladding, sheds, fencing and decks, storage systems, pipes, and other construction systems. The company had annual sales of C$1.7 billion for fiscal 2005. GLOBAL CROSSING: Inks 1st Supplemental Indenture for 5% Sr. Notes ----------------------------------------------------------------- Global Crossing Limited entered into a First Supplemental Indenture with Wells Fargo Bank, N.A., on May 30, 2006. The First Supplemental Indenture supplements the Base Indenture dated as of May 18, 2006, between the Company and Wells Fargo with respect to the Company's issuance of its 5.0% Convertible Senior Notes due 2011. A copy of the Supplemental Indenture is available for free at http://researcharchives.com/t/s?b44 In connection with the Convertible Senior Notes Indenture, the Company entered into the Pledge Agreement dated as of May 30, 2006, with Wells Fargo, pursuant to which the Company purchased security entitlements with respect to a portfolio of U.S. treasury securities, for the account of the Pledged Securities Intermediary for credit to the Pledge Account, in an amount sufficient to provide for the payment in full of the first six scheduled interest payments due on the Convertible Senor Notes. A copy of the Pledge Agreement is available for free at http://researcharchives.com/t/s?b41 In connection with recent financing activities, Global Crossing also entered into Amendment No. 1 to Indenture dated as of May 30, 2006, among the Company, the other credit parties, Wells Fargo, and STT Crossing Ltd, amending the Indenture dated December 23, 2004 pursuant to which the Company previously issued $250,000,000 in aggregate principal amount of its 4.7% Senior Secured Mandatory Convertible Notes. STT Crossing, a wholly owned subsidiary of Singapore Technologies Telemedia Pte Ltd and the majority shareholder of the Company, holds 100% of the issued and outstanding Mandatory Convertible Notes. The Indenture Amendment clarifies that the Loan and Security Agreement described in Item 8.01 below constitutes a "Working Capital Facility" as defined in the Mandatory Convertible Notes Indenture and is therefore not prohibited by the covenants in such indenture restricting the Company's ability to incur debt and grant liens. A copy of the Indenture Amendment is available for a fee at http://researcharchives.com/t/s?b42 In connection with the Indenture Amendment, the Company also entered into Amendment No. 2 to Restructuring Agreement dated as of May 30, 2006, with Global Crossing Holdings Limited, Global Crossing North American Holdings, Inc., Global Crossing (UK) Telecommunications Limited, STT Crossing and STT Communications Ltd. The Amendment to Restructuring Agreement amended the Restructuring Agreement among the parties dated as of October 8, 2004 to clarify that the 175 basis point consent fee payable to STT Crossing under section 1.8 of such Restructuring Agreement applies to all "Working Capital Facilities" as defined in the Mandatory Convertible Notes Indenture. A copy of the Amendment to Restructuring Agreement is available for free at http://researcharchives.com/t/s?b43 $55 Million Credit Facility Certain affiliates of Global Crossing previously entered into the Loan and Security Agreement dated as of May 10, 2006, among Global Crossing Advanced Card Services, Inc., Global Crossing Bandwidth, Inc. and Global Crossing Telecommunications, Inc., and Bank of America, N.A., as agent for the Lenders. The Lenders have extended a credit facility in the amount of up to $55,000,000 for commercial letters of credit and to fund their ongoing working capital requirements. The Loan and Security Agreement has an initial maximum availability of $35,000,000. Initial advances are subject to certain state regulatory approvals, which are expected over the next four to five months, and to customary closing conditions. A copy of the Loan and Security Agreement is available for fee at http://researcharchives.com/t/s?b45 About Global Crossing Headquartered in Florham Park, New Jersey, Global Crossing Ltd. -- http://www.globalcrossing.com/-- provides telecommunications solutions over the world's first integrated global IP-based network, which reaches 27 countries and more than 200 major cities around the globe. Global Crossing serves many of the world's largest corporations, providing a full range of managed data and voice products and services. The Company filed for chapter 11 protection on January 28, 2002 (Bankr. S.D.N.Y. Case No. 02-40188). When the Debtors filed for protection from their creditors, they listed $25,511,000,000 in total assets and $15,467,000,000 in total debts. Global Crossing emerged from chapter 11 on Dec. 9, 2003. At March 31, 2006, the Company's balance sheet showed total assets of $1,512 million and total liabilities of $1,768 million, resulting in a $256 million shareholders' deficit. The Company reported a $173 million equity deficit at Dec. 31, 2005. GT BRANDS: Plan Confirmation Hearing Scheduled for July 18 ---------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York set a hearing at 11:00 a.m. on July 18, 2006, to consider confirmation of GT Brands Holdings LLC and its debtor-affiliates' First Amended Plan of Liquidation. Objections to the Plan, if any, must be filed, in writing, with the Court by 4:00 p.m. on July 8, 2006. The Court approved the adequacy of the Debtor's disclosure statement explaining the amended plan on June 2, 2006. Overview of the Plan As reported in the Troubled Company Reporter on May 25, 2006, the Plan is a product of substantial discussions and negotiations among the Debtors, the Senior Lenders and the Creditors Committee. The Debtors estimated that, in addition to non-cash assets, they will transfer approximately $7.6 million in cash to a Plan Administrator. The Plan Administrator will ultimately distribute an aggregate of approximately $3.7 million to $4.1 million to the Senior Lenders. This amount represents the Debtors' cash, less amounts to establish and fund: -- the Affiliate Debtors Carve-Out Fund amounting to $1 million; -- the Asset Recovery Fund amounting to $400,000; -- the Plan Operations Fund, approximately $1,500,000, based on an estimated windup date of June 30, 2006, which includes around $500,000 to fund the Disputed Claims Reserves; and -- distributions on account of Administrative Expense Claims and Priority Claims, totaling between $700,000 and $1,300,000. The Debtors estimate that these distributions, together with other amounts paid to the Senior Lenders since their bankruptcy filing, including amounts paid under the Court's Cash Collateral Order, will aggregate approximately $29.5 million to $29.9 million. Holders of general unsecured claims against GT Brands, amounting to $77.09 million, will receive a pro rata share of the proceeds of the Causes of Action and the Avoidance Actions, if any. Holders of general unsecured claims against the affiliate debtors, amounting to $28.4 million to $31.9 million, will receive a pro rata share of: -- Affiliate Debtors Carve-Out Fund; -- proceeds of the Affiliate Debtors Avoidance Actions. Equity holders will get nothing under the Plan. A copy of the Debtors' Disclosure Statement explaining their Amended Plan is available for a fee at: http://www.researcharchives.com/bin/download?id=060612043113 About GT Brands Headquartered in New York, New York, GT Brands Holdings LLC, supplies home video titles to mass retailers. The Debtors also develop and market branded consumer, lifestyle and entertainment products. The Company and its affiliates filed for chapter 11 protection on July 11, 2005 (Bankr. S.D.N.Y. Case No. 05-15167). Brian W. Harvey, Esq., at Goodwin Procter LLP, represents the Debtors in their chapter 11 proceedings. Patrick J. Orr, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, represent the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed total assets of $79 million and total debts of $212 million. HILITE INDUSTRIES: Moody's Withdraws Junk Rating on $130 Mil. Loan ------------------------------------------------------------------ Moody's Investors Service withdrew the ratings of Hilite International, Inc.; its U.S. subsidiary, Hilite Industries, Inc.; and its European subsidiary, Hilite Germany GmbH & Co. KG. The ratings were withdrawn based on Moody's opinion that there is insufficient information to assess effectively the creditworthiness of the issuer or its obligations. Ratings Withdrawn: Hilite International, Inc.: * Caa1 Corporate Family Hilite Industries, Inc.: * Caa1 rating of the $60 million senior secured revolving credit and $70 million senior secured term loan * Caa3 rating of the $30 million senior subordinated notes Hilite Germany GmbH & Co. KG: * Caa1 of the $50 million senior secured term loan Moody's last rating action for Hilite was on April 12, 2006 when the ratings were lowered. Hilite, headquartered in Cleveland, Ohio, is a designer and manufacturer of highly-engineered, valve-based components, assemblies, and systems used principally in powertrain applications for the automotive market. HILITE INT'L: Insufficient Info Cues Moody's to Withdraw Rating --------------------------------------------------------------- Moody's Investors Service withdrew the ratings of Hilite International, Inc.; its U.S. subsidiary, Hilite Industries, Inc.; and its European subsidiary, Hilite Germany GmbH & Co. KG. The ratings were withdrawn based on Moody's opinion that there is insufficient information to assess effectively the creditworthiness of the issuer or its obligations. Ratings Withdrawn: Hilite International, Inc.: * Caa1 Corporate Family Hilite Industries, Inc.: * Caa1 rating of the $60 million senior secured revolving credit and $70 million senior secured term loan * Caa3 rating of the $30 million senior subordinated notes Hilite Germany GmbH & Co. KG: * Caa1 of the $50 million senior secured term loan Moody's last rating action for Hilite was on April 12, 2006 when the ratings were lowered. Hilite, headquartered in Cleveland, Ohio, is a designer and manufacturer of highly-engineered, valve-based components, assemblies, and systems used principally in powertrain applications for the automotive market. INDUSTRIAL ENT: Posts $2.2 Mil. Net Loss in First Quarter 2006 -------------------------------------------------------------- Industrial Enterprises of America, Inc. fka Advanced Bio/Chem, Inc., filed its 1st quarter financial statements for the three months ended March 31, 2006, with the Securities and Exchange Commission. The Company reported a $2,276,928 net loss on $9,030,898 of revenues for the three months ended March 31, 2006. At March 31, 2006, the Company's balance sheet showed $35,345,797 in total assets, $28,787,216 in total liabilities, and $6,558,581 in stockholders' equity. Full-text copies of the Company's financial statements for the three months ended March 31, 2006, are available for free at http://researcharchives.com/t/s?b3e Going Concern Doubt Beckstead and Watts, LLP, in Henderson, Nevada, raised substantial doubt about Industrial Enterprises' ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended June 30, 2005. The auditor pointed to the Company's net losses from its inception, and its limited operations, since the Company has not commenced planned principal operations. About Industrial Enterprises Headquartered in New York, New York, Industrial Enterprises of America, Inc. -- http://www.TheOtherGas.com/-- is a holding Company with three operating subsidiaries, EMC Packaging, Unifide Industries and Todays Way Manufacturing, LLC. EMC Packaging is one of the largest worldwide providers of refrigerant gases, specializing in converting hydroflurocarbon gases into branded and private label refrigerant and propellant products as well as packaging of "gas dusters" used in a variety of industries. Unifide Industries markets and sells specialty automotive products under proprietary trade names and private labels, and Todays Way Manufacturing manufactures and packages the products sold by Unifide Industries. INTELSAT LTD: Unit Proposes $1.9 Billion Senior Notes Offering -------------------------------------------------------------- Intelsat, Ltd.'s wholly owned subsidiary, Intelsat (Bermuda), Ltd. intends to offer approximately $1.9 billion of senior notes due 2013 and 2016 in connection with its contemplated acquisition of PanAmSat Holding Corporation. In addition, PanAmSat Holding Corporation intends to offer approximately $725 million of senior notes due 2016 and PanAmSat Corporation intends to offer approximately $575 million of senior notes due 2016. The net proceeds from these offerings will be used, together with cash on hand, to consummate the Acquisition. PanAmSat Holding Corporation has commenced an offer to purchase and consent solicitation for any and all of its outstanding 10-3/8% senior discount notes due 2014. If the tender offer is consummated, PanAmSat Holding Corporation will not issue the senior notes and Intelsat (Bermuda), Ltd. will issue approximately an additional $1.0 billion of senior notes to fund the tender offer and consent payments, as well as the balance of the Acquisition merger consideration. Intelsat, Ltd. - http://www.intelsat.com/-- offers telephony, corporate network, video and Internet solutions around the globe via capacity on 25 geosynchronous satellites in prime orbital locations. Customers in approximately 200 countries rely on Intelsat's global satellite, teleport and fiber network for high- quality connections, global reach and reliability. * * * As reported in the Troubled Company Reporter on April 11, 2006, Standard & Poor's Ratings Services held all ratings on fixed satellite services provider Intelsat Ltd. (BB-/Watch Neg/--) on CreditWatch with negative implications. INT'L COAL INC: S&P Junks Rating on Proposed $250 Mil. Sr. Notes ---------------------------------------------------------------- Standard & Poor's Rating Services assigned its 'B' bank loan rating and its '1' recovery rating to the $350 million secured revolving credit facility of International Coal Group LLC (B- /Stable/--) and a 'CCC+' rating to parent International Coal Group Inc.'s proposed $250 million of senior unsecured notes due 2014 based on preliminary terms and conditions. At the same time, Standard & Poor's affirmed its corporate credit rating on ICG. The outlook is stable. The 'B' bank loan rating and the '1' recovery rating indicate a high expectation of full recovery of principal (100%) in the event of a payment default. S&P expects ICG to use proceeds from the offerings to fund the company's significant capital expenditure program and repay existing debt. "ICG, a U.S. coal producer, should continue to benefit from favorable coal industry conditions for the intermediate term," said Standard & Poor's credit analyst Thomas Watters. "We could revise the outlook on the company to positive if ICG appears to be successful in executing its aggressive capital spending plans to improve, diversify, and expand its operations without incurring a substantial increase in its debt levels. Conversely, ICG's ratings could be pressured if it meets with significant cost overruns or significantly increases in its debt levels." Pro forma as of March 31, 2006, ICG will have $480 million of liquidity at closing, but this is expected to materially decline as the company continues its capital spending program. It is difficult to determine if this liquidity in combination with volatile cash flows, will be sufficient to fund a long-term capital program of this magnitude. The company is susceptible to cost overruns, difficult mining conditions, and coal-price volatility. Standard & Poor's does expect the company to be free cash flow negative for the next few years as the bulk of its capital program is spent. However, some of the capital expenditures can be deferred if market conditions deteriorate. ICG averages about $3.50 per ton on maintenance capital expenditures. INT'L COAL LLC: S&P Rates $350 Million Secured Facility at B ------------------------------------------------------------ Standard & Poor's Rating Services assigned its 'B' bank loan rating and its '1' recovery rating to the $350 million secured revolving credit facility of International Coal Group LLC (B- /Stable/--) and a 'CCC+' rating to parent International Coal Group Inc.'s proposed $250 million of senior unsecured notes due 2014 based on preliminary terms and conditions. At the same time, Standard & Poor's affirmed its corporate credit rating on ICG. The outlook is stable. The 'B' bank loan rating and the '1' recovery rating indicate a high expectation of full recovery of principal (100%) in the event of a payment default. S&P expects ICG to use proceeds from the offerings to fund the company's significant capital expenditure program and repay existing debt. "ICG, a U.S. coal producer, should continue to benefit from favorable coal industry conditions for the intermediate term," said Standard & Poor's credit analyst Thomas Watters. "We could revise the outlook on the company to positive if ICG appears to be successful in executing its aggressive capital spending plans to improve, diversify, and expand its operations without incurring a substantial increase in its debt levels. Conversely, ICG's ratings could be pressured if it meets with significant cost overruns or significantly increases in its debt levels." Pro forma as of March 31, 2006, ICG will have $480 million of liquidity at closing, but this is expected to materially decline as the company continues its capital spending program. It is difficult to determine if this liquidity in combination with volatile cash flows, will be sufficient to fund a long-term capital program of this magnitude. The company is susceptible to cost overruns, difficult mining conditions, and coal-price volatility. Standard & Poor's does expect the company to be free cash flow negative for the next few years as the bulk of its capital program is spent. However, some of the capital expenditures can be deferred if market conditions deteriorate. ICG averages about $3.50 per ton on maintenance capital expenditures. INTERPUBLIC GROUP: Howard Draft Leads United FCB and Draft Units ---------------------------------------------------------------- The Interpublic Group will bring its Draft and FCB units together to create a global integrated marketing organization with a single management team and P&L. Draft FCB Group, the new entity that will emerge, represents a communications model designed to address the needs of clients in today's dynamic, consumer-driven marketing environment. "Clients are increasingly looking to us to deliver more personalized, creative and accountable communications programs, with best-in-class capabilities across the marketing spectrum," said Michael I. Roth, Interpublic's Chairman and CEO. "Steve Blamer and Howard Draft each came forward to propose linking these two strong companies with highly complementary capabilities. We carefully considered the potential of a combination and believe that the resulting organization will be highly responsive to the new realities that are transforming the consumer and media landscape. There is still a great deal of work to be done by the full leadership teams of both companies to develop a comprehensive plan and definitive timeline for integration. We are, however, all of one mind - the resulting agency will be uniquely positioned to deliver marketing programs that connect with consumers through powerful creative ideas that drive measurable ROI." "We're confident that Howard and the management team he assembles can create a world-class organization," adds Mr. Roth. "During his time at FCB, Steve has streamlined the FCB operation and put the company on firm ground. He has also made great strides in moving the company to a more holistic and contemporary offering. Having helped turbo-charge this process by means of a combination with Draft, he has decided to move on to other challenges. We appreciate Steve's leadership and the selfless role he played in making a great strategic idea into a reality." Effective immediately, Howard Draft, 52, has been named Chairman and CEO of the joint Draft and FCB operations. After a transitional period, Steve Blamer, 50, will be leaving FCB and Interpublic. FCB's Jonathan Harries, 53, has been named Worldwide Chief Creative Officer for the new company. Integration teams are being formed with equal representation from both companies to develop plans for integrating key areas such as geographic market alignment, professional competencies and capabilities (business development, creative services, research, strategic planning, media), human resources and communications, as well as finance and operations. These teams will report to an Integration Committee led by Draft's Laurence Boschetto and Mr. Harries. It is expected that the work of the Integration Committee will be completed in approximately 90 days, at which time the new agency's organizational and management structure will be announced. Full implementation of the merger will begin at that point and last for six to twelve months. As with any merger, the company expects that there will be certain related costs. Although this is not a cost-driven combination, the integration teams will also be examining potential cost savings. The Integration Committee will report to Mr. Draft and meet regularly with a Transition Board made up of Mr. Draft and Interpublic's EVP, CFO Frank Mergenthaler and its EVP, Strategy, Philippe Krakowsky. Independent or separately-branded units currently grouped with either FCB or Draft, which include FCBi, Marketing Drive, R/GA and Zipatoni will continue to operate independently, serving their existing client rosters and collaborating across Interpublic. "Bringing together FCB and Draft, two strong and highly complementary organizations, positions us perfectly to address evolving client demand," said Mr. Draft. "Unlike other models, in which one discipline dominates, our approach has the revolutionary potential of being grounded in creativity, fueled by insights into consumer behavior. This strategy - and the joint contributions of Draft and FCB to developing it - will be the cornerstone of our new company." "In making this recommendation to Michael several months ago, I firmly believed that this merger would give FCB the shot in the arm the agency needs to reach new heights," said Mr. Blamer. "It's about creating a powerful offering that will allow clients to get precisely the resources they want." Post-integration, the new organization will have a pioneering go- to-market strategy; at the same time, it will maintain the core competencies that existing clients chose in making the decision to work with Draft or FCB. Clients satisfied with their current relationships with either brand will, of course, have the option of not engaging the new combined offering. Despite the flexibility that the new organization will provide clients and the extended period before full integration, the possibility of certain client conflicts cannot be ruled out. The management of both agencies has and will continue to communicate regularly with all clients as it relates to the benefits of the merger. FCB brings excellence in the critical areas of branding, creative, digital and media planning and particular strength in India and Brazil, two key growth markets. Draft is known for its outstanding work in behavioral strategic development and the creation of profitable customer experiences through data and CRM, retail and promotions, accountability and ROI discipline. The merged company will offer services in brand advertising development, CRM, interactive marketing, promotions, retail, healthcare (professional, DTC and OTC), as well as media capabilities in direct TV, interactive and mass communications. About Interpublic Interpublic Group of Companies Inc. (NYSE:IPG) -- http://www.interpublic.com/-- is one of the world's leading organizations of advertising agencies and marketing-services companies. Major global brands include Draft, Foote Cone & Belding Worldwide, FutureBrand, GolinHarris International, Initiative, Jack Morton Worldwide, Lowe Worldwide, MAGNA Global, McCann Erickson, Octagon, Universal McCann and Weber Shandwick. Leading domestic brands include Campbell-Ewald, Deutsch and Hill Holliday. * * * As reported in the Troubled Company Reporter on April 11, 2006, Moody's Investors Service downgraded The Interpublic Group of Companies, Inc.'s corporate family and senior unsecured long term debt ratings to Ba3 from Ba1. The outlook remains negative. As reported in the Troubled Company Reporter on March 31, 2006, Fitch Ratings downgraded Interpublic Group's ratings. Affected ratings include: -- Issuer default rating to 'B' from 'B+' -- Senior unsecured credit facility to 'B' from 'B+' (Recovery Rating 'RR4'); -- Senior unsecured notes to 'B' from 'B+' (Recovery Rating 'RR4') -- Cumulative convertible perpetual preferred stock to 'CCC' from 'CCC+' (Recovery Rating 'RR6') -- Mandatory convertible preferred stock to 'CCC' from 'CCC+' (Recovery Rating 'RR6') The Rating Outlook is Negative. As reported in the Troubled Company Reporter on March 24, 2006, Standard & Poor's Ratings Services lowered its ratings on The Interpublic Group of Cos. Inc., including lowering the long-term corporate credit rating to 'B' from 'B+'. The short-term credit rating was lowered to 'B-3' from 'B-2'. All ratings were placed on CreditWatch with negative implications. J.L. FRENCH: Court Approves Varnum Riddering as Special Counsel --------------------------------------------------------------- J.L. French Automotive Castings, Inc., and its debtor-affiliates obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Varnum, Riddering, Schmidt, & Howlett LLP as their special counsel. Varnum Riddering is expected to advise the Debtors and their boards of directors with respect to: a) general corporate matters (not including bankruptcy); b) non-bankruptcy commercial matters; c) pending litigation; d) labor and employee benefit plans; and e) environmental matters. A full-text copy of the Compensation Rates of Varnum Riddering's Professionals is available for free at: http://ResearchArchives.com/t/s?b4f Michael Wooldridge, a partner at Varnum Riddering, assures the Court that Miller Buckfire is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not hold or represent any interest adverse to the Debtors' estates. About J.L. French 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. Miller Buckfire & Co., LLC, serves as their financial advisor. Ricardo Palacio, Esq., and William Pierce Bowden, Esq., at Ashby & Geddes, PA, represents the Official Committee Of Unsecured Creditors. When the Debtor filed for chapter 11 protection, it estimated assets and debts of more than $100 million. J.P. MORGAN: Moody's Assigns Low-B Ratings on Two Cert. Classes --------------------------------------------------------------- Moody's Investors Service assigned a Aaa rating to the senior certificates issued by J.P. Morgan Mortgage Acquisition Trust 2006-ACC1, and ratings ranging from Aaa to Ba2 to the subordinate certificates in the deal. The securitization is backed by Accredited Home Lenders, Inc. originated, adjustable-rate and fixed-rate, subprime mortgage loans acquired by J.P. Morgan Mortgage Acquisition Corp. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, excess spread, and overcollateralization. The ratings also benefit from an interest- rate swap agreement provided by JPMorgan Chase Bank, National Association. Moody's expects collateral losses to range from 4.95% to 5.45%. JPMorgan Chase Bank, National Association will service the loans. Moody's has assigned JPMorgan its top servicer quality rating as a primary servicer of subprime first-lien loans. The complete rating actions: J.P. Morgan Mortgage Acquisition Trust 2006-ACC1 Asset-Backed Pass Through Certificates, Series 2006-ACC1 * Cl. A-1, Assigned Aaa * Cl. A-2, Assigned Aaa * Cl. A-3, Assigned Aaa * Cl. A-4, Assigned Aaa * Cl. A-5, Assigned Aaa * Cl. M-1, Assigned Aaa * Cl. M-2, Assigned Aa2 * Cl. M-3, Assigned Aa2 * Cl. M-4, Assigned A1 * Cl. M-5, Assigned A2 * Cl. M-6, Assigned A3 * Cl. M-7, Assigned Baa1 * Cl. M-8, Assigned Baa2 * Cl. M-9, Assigned Baa3 * Cl. M-10, Assigned Ba1 * Cl. M-11, Assigned Ba2 JAMES RIVER: Can Draw on $25 Million Debt Facility -------------------------------------------------- James River Coal Company entered into Amendment No.2 and Waiver to the Credit Agreement dated as of May 31, 2005 with PNC Bank, National Association, as Administrative Agent, and Morgan Stanley Senior Funding, Inc., as Syndication Agent. The Amendment clarifies and modifies certain financial covenants for portions of 2006 and 2007 in a manner that substantially increases current and expected availability under the Credit Agreement. The Amendment: -- corrects a typographical error in the timing of stepdowns for the Leverage Ratio, and waives any failure to comply that might have resulted from such typographical error; -- amends the method of calculating the Leverage Ratio, Senior Secured Leverage Ratio and Fixed Charge Coverage Ratio for the first three fiscal quarters of 2006 so that actual to-date 2006 Consolidated EBITDA will be annualized, rather than using the trailing four quarters Consolidated EBITDA; -- increases the amount of indebtedness that the Company is permitted to incur or assume in connection with capital expenditures from $5 million to $10 million; -- increases the Loan ABR Spread to 2.00% and the Loan Eurodollar Spread to 3.00% from the variable rates for such spreads based on the Company's Leverage Ratio, for the period from May 30, 2006 through December 31, 2006, provided that if the credit facilities under the Credit Agreement are not rated at least B1 by Moody's and B by S&P after May 30, 2006, then each such percentage shall be increased by 0.25%; and -- increases the fixed portion of the participation fee on Synthetic Letters of Credit from 2.75% to 3.00% for the period from February 23, 2006 through December 31, 2006, provided that if the credit facilities under the Credit Agreement are not rated at least B1 by Moody's and B by S&P after May 30, 2006, then the fixed portion of the participation fee shall be increased by 0.25%. Upon effectiveness of the Amendment, the full $25 million Revolver facility was available for borrowing. The Company believes that its cash on hand, cash generated from its operations and available borrowings under the Revolver, as amended, will provide adequate liquidity at least through the end of 2006. Headquartered in Richmond, Virginia, James River Coal Co. -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous, low sulfur, steam- and industrial-grade coal through five operating subsidiaries located throughout Eastern Kentucky. James River's five mining complexes include 17 mines and seven preparation plants, five of which have integrated rail loadout facilities and two of which use a common loadout facility at a separate location. James River emerged from bankruptcy in May 2004 with its Central Appalachian assets. Subsequently, the company acquired mining assets located in the Illinois coal basin on May 31, 2005, that currently account for approximately one third of production. * * * As reported in the Troubled Company Reporter on March 15, 2006, Standard & Poor's Ratings Services lowered its corporate credit rating on James River to 'B-' from 'B'. At the same time, the secured debt rating was lowered to 'B' from 'B+' and unsecured debt rating to 'CCC' from 'CCC+'. S&P said the outlook is developing. As reported in the Troubled Company Reporter on March 6, 2006, Moody's Investors Service placed James River Coal Company's B2 corporate family rating, its B1 senior secured rating and its B3 senior unsecured rating under review for possible downgrade. At the same time Moody's affirmed James River Coal's SGL-4 speculative grade liquidity rating, reflecting weak liquidity. JESSE REESE: Case Summary & 16 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Jesse Lee Reese P.O. Drawer AD Ralls, Texas 79357 Bankruptcy Case No.: 06-50133 Chapter 11 Petition Date: June 13, 2006 Court: Northern District of Texas (Lubbock) Judge: Robert L. Jones Debtor's Counsel: David R. Langston, Esq. Mullin, Hoard & Brown, LLP P.O. Box 2585 Lubbock, Texas 79408-2585 Tel: (806) 765-7491 Fax: (806) 765-0553 Total Assets: $5,962,956 Total Debts: $8,736,700 Debtor's 16 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ C&R Gin, Inc. Miscellaneous $1,866,026 P.O. Drawer, AD Advances Ralls, TX 79357 Internal Revenue Service 2005 1040 Taxes $600,000 Cincinnati, OH 45999-0150 2005 943 Taxes $22,532 2004 1040 Taxes $30,661 2004 943 Taxes $24,372 Lowell Richardson Estate Promissory Notes $537,353 c/o Norton Baker purchased from Baker Brown & Thompson, P.C. State National Bank 5010 University Avenue Suite 433 Lubbock, TX 79413 Commercial State Bank Guaranty of C&R $257,534 P.O. Box 309 Gin, Inc. Notes Andrews, TX 79714 Stan McRae Accounting Services $119,575 Lubbock National Bank Lease Agreement $117,000 Guaranty Trinity Company Note Guarantee $114,900 Bob Hamilton Trade Debt $93,599 Touchstone C&R Gin #2 $70,243 Guaranty of SBA Loan Texas Boll Weevil Boll Weevil $61,223 Eradication Assessment United States Treasury - IRS Structured Payment $47,532 of 943 Taxes Crosby County Central 2004 Property Taxes $30,599 66 Wholesale Fuel $29,866 Hurst Farm Plan Repairs $21,395 Crosby County Fuel Assoc. Fuel $18,911 Rip Griffin's General Offices Fuel $18,000 KNOLL INC: Adopts 10b5-1 Plan for $50 Million Share Repurchase -------------------------------------------------------------- Knoll, Inc., adopted a written trading plan under Rule 10b5-1 of the Securities Exchange Act of 1934 on May 31, 2006, to facilitate repurchases during the months of June and July 2006 under its $50,000,000 share repurchase plan announced in February 2006. Under the Company 10b5-1 Plan, Bank of America Securities LLC will have the authority to repurchase up to an aggregate of $10,000,000 worth of Knoll common stock on behalf of the Company during June and July of 2006. The Company 10b5-1 Plan does not require that any shares be purchased, and there can be no assurance that any shares will be purchased. Purchases may be made under the Company 10b5-1 Plan beginning June 1, 2006. The Share Repurchase Plan will continue to be in effect following the expiration of the Company 10b5-1 Plan, which expires on the earlier of July 28, 2006 or the date on which purchases are completed. As of May 31, 2006, the Company has repurchased 167,500 shares for $3,279,381 under the Share Repurchase Plan. A 10b5-1 plan allows the Company to repurchase shares at times when it would ordinarily not be in the market because of the Company's trading policies or the possession of material non- public information. Headquartered in East Greenville, Pennsylvania, Knoll Inc., (NYSE:KNL) designs and manufactures branded office furniture products and textiles, serves clients worldwide. * * * As reported in the Troubled Company Reporter on Sept. 12, 2005, Standard & Poor's Ratings Services assigned its 'BB-' rating and its '3' recovery rating to Knoll Inc.'s proposed $450 million senior secured credit facilities, indicating that lenders can expect meaningful recovery of principal in the event of payment default. These ratings are based on preliminary offering statements and are subject to review upon final documentation. In addition, Moody's Investors Service assigned a Ba3 rating to the Company's $450 million senior secured credit facility, which is comprised of a revolver and a term loan. At the same time, Moody's affirmed Knoll's corporate family rating at Ba3. Moody's said the ratings outlook is stable. Moody's said it would withdraw its ratings on Knoll's $425 million senior secured term loan and $75 million revolver upon the closing of the new secured credit facility. LAZY DAYS: Depressed RV Sales Prompt S&P's Negative Outlook ----------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Lazy Days' R.V. Center Inc. to negative from stable, because of depressed sales of the company's most profitable product, Class A recreational vehicles. At the same time, Standard & Poor's affirmed the 'B+' corporate credit rating on the RV retailer. Seffner, Florida-based Lazy Days' has total debt, including the present value of operating leases and excluding floor plan liabilities, of about $180 million. Demand for new Class A motor homes, the largest and most expensive category of RVs, has been depressed for the past year, partly because of high fuel costs and rising interest rates, which are likely to persist for the near-to-medium term and could cause high-end RV sales to remain depressed. "We could lower the ratings if Lazy Days' is unable to offset weak demand, causing profitability to decline and cash flow generation to become negative," said Standard & Poor's credit analyst Martin King. "We could revise the outlook to stable, however, if demand improves, or the company is able to increase earnings and cash flow by reducing costs or diversifying its business mix." LEHMAN XS: Moody's Rates Class B Notes at Ba2 --------------------------------------------- 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 2006-5. The notes are backed by residual and prepayment penalty cash flows from an underlying securitization of Alt-A, adjustable-rate and fixed-rate residential mortgage loans: Lehman XS Trust Mortgage Pass-Through Certificates, Series 2006-5. 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. 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: Issuer: Lehman XS NIM Company 2006-5 Co-Issuer: SASCO ARC Corporation Securities: Lehman XS Net Interest Margin Notes, Series 2006-5 * Cl. A, Assigned A3 * Cl. B, Assigned 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. LENOX HEALTHCARE: Court Nixes Preference Claims v. Guardian Life ---------------------------------------------------------------- On July 10, 2003, Charles M. Golden, the chapter 11 trustee in Lenox Healthcare, Inc.'s bankruptcy case, sued Guardian Life Insurance Company of America to avoid and recover three allegedly preferential payments totaling approximately $475,000. Guardian moved to dismiss the Chapter 11 Trustee's Complaint, arguing that: (1) the Transfers were not property of the estate; (2) Guardian was not an initial transferee but a "mere conduit"; and (3) the Trustee cannot satisfy his burden of proof under 11 U.S.C. Sec. 547(b)(5). The Trustee asserted that the Transfers consisted partially of property of the estate, and that the question of whether the Transfers were comprised wholly or partially of estate property is a disputed issue of material fact precluding summary judgment. The Honorable Mary F. Walrath considered the insurer's Motion for Summary Judgment filed in the adversary proceeding (Adv. Pro. No. 03-54314) and issued a Memorandum Opinion on June 1, 2006, which is published at 2006 WL 1523163. Property of the Estate To the extent the Transfers constitute employer contributions under an employee benefit plan, Judge Walrath finds, they were property of the estate at the time of transfer and only became trust assets after the transfer. Thus, Judge Walrath says the Trustee may seek to avoid and recover the employer contributions under chapter 5 of the bankruptcy code. Consequently, the Court concludes that the Trustee may not avoid the portion of the Transfers that constitutes employee contributions but may be able to avoid the portion that constitutes the Debtor's contributions. A material issue remains in dispute as to which portion of the Transfers were employee withholdings and which were the Debtor's contributions. Mere Conduit Guardian argued that it did not have a beneficial interest in the Transfers and that it was a "mere claims paying agent," required to receive the Transfers in trust for the Debtor's employees or for the healthcare providers rendering medical services. The Trustee did not respond to Guardian's "mere conduit" argument. Judge Walrath concluded that the "mere conduit" defense is not available to Guardian. The documents presented by Guardian demonstrate that the Transfers were payments from the Debtor to reimburse Guardian for its advance payment of employee claims, Judge Walrath observes. The Transfers did not merely flow through Guardian to the health care providers. When Guardian accepted the challenged payments for benefit claims that it had already paid, Judge Walrath says, it received the payments with complete freedom to use them in any manner that it pleased, whether to buy lottery tickets or uranium stock. The insurer was an "initial transferee" and thus potentially liable if the debtor's payments were avoided, Judge Walrath concludes. Guardian Prevails Guardian's final argument challenged the Trustee's allegation that the Transfers constituted preferential transfers. Specifically, Guardian argued that the Trustee failed to carry his burden of proof under 11 U.S.C. Sec. 547(b)(5), which requires that the Trustee establish the Transfers enabled Guardian to receive more that it would have received if "(A) the case were a case under chapter 7 . . . ; (B) the transfer had not been made; and (C) [Guardian] received payment of such debt to the extent provided by the provisions of [the Code]." To satisfy his burden, the Trustee must offer evidence of the Debtor's liabilities, the amount of claims filed against the Debtor, and whether any assets have been recovered since the Petition Date. See Biggs v. Capital Factors, Inc. (In re Goetz), No. 96-55944, 1997 U.S. App. LEXIS 19191, at *3 (9th Cir. July 24, 1997) (holding that without evidence of assets, liabilities and claims, "the bankruptcy court was unable to determine whether [the defendant] received more than other creditors in its class . . . under a Chapter 7 liquidation"); Burdick v. Lee, 256 B.R. 837, 841 (D. Mass. 2001) (same). Guardian cites the lack of evidence produced by the Trustee as well as the Trustee's answers to Guardian's request for admissions. Of particular note is the Trustee's admission that he did not perform any analysis or calculation to support his section 547(b)(5) allegation. Once again, the Trustee did not address this argument. Judge Walrath concludes that the Trustee has failed to carry his burden of proof and that a grant of partial summary judgment in favor of Guardian is appropriate. The Trustee has the burden of proving the avoidability of the Transfers under section 547(b) and must establish each element of section 547(b), including section 547(b)(5). In this case, Judge Walrath says, there's been adequate time for discovery and the Trustee has presented no evidence in response to Guardian's Motion for Summary Judgment to support an element essential to his claim. Lenox Healthcare, Inc., then one of the leading leading health care providers in the United States, filed for chapter 11 protection on July 10, 2001 (Bankr. D. Del. Case No. 01-2288), in the U.S. Bankruptcy Court for the District of Delaware. The company's operations have ceased. Charles M. Golden, the appointed Chapter 11 Trustee, has been working to transition the Debtor's business to its secured creditors and lessors and wind up the Debtor's estates. LIBBEY GLASS: S&P Rates Proposed $300 Million Senior Notes at B --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its secured debt and recovery ratings to Libbey Glass Inc.'s proposed $300 million senior secured second-lien floating-rate notes due 2011. The secured debt rating is 'B' (at the same level as the 'B' corporate credit rating on parent company Libbey Inc.) and the recovery rating is '2', indicating the expectation for substantial (80%- 100%) recovery of principal in the event of a payment default. Libbey Inc. is also a guarantor of the proposed notes. For analytical purposes, Standard & Poor's views Libbey Inc. and Libbey Glass Inc. as one economic entity. All ratings are based on preliminary offering statements and are subject to review upon final documentation. Libbey Inc. revised the terms of its previously announced debt offering, related to its planned acquisition of the remaining 51% of the capital stock of its joint venture, Vitrocrisa Holdings S de R.L. de C.V., and related companies from its joint venture partner Vitro S.A. de C.V. (B-/Negative/--). The company now plans to finance the transaction with: * a new $150 million first-lien senior secured revolving credit facility (unrated); * the newly rated $300 million of senior secured second-lien floating rate notes; and * $100 million of new secured third-lien senior subordinated pay-in-kind notes due 2011 (unrated). The previously announced offering of $400 million of senior unsecured notes has been terminated, and Standard & Poor's has withdrawn its senior unsecured debt rating on these notes. The corporate credit rating on Toledo, Ohio-based Libbey Inc. is 'B' and the rating outlook is stable. The rating reflects: * the company's narrow business focus; * capital and labor-intensive operations; * vulnerability to volatility in natural gas prices; * sizable unfunded pension and postretirement medical benefit obligations; and * leveraged financial profile. Somewhat mitigating these factors is Libbey's leading market share as a glassware provider within the U.S. foodservice industry. In addition, the acquisition of the remaining interest in Crisa provides the company with greater geographic reach and some cost- saving opportunities. Ratings List: Libbey Inc.: * Corporate credit rating -- B/Stable/-- Rating Assigned: Libbey Glass Inc.: * $300M secd 2nd-lien debt -- B (Recovery rating: 2) Rating Withdrawn: Libbey Glass Inc.: * Senior unsecured debt -- to NR from B LITFUNDING CORP: Court Enters Final Decree Closing Chapter 11 Case ------------------------------------------------------------------ LitFunding Corp. received, on June 12, 2006, an order of final decree closing its bankruptcy proceedings on the grounds that the bankruptcy case has been fully administered. An involuntary bankruptcy petition was filed against LitFunding on April 2, 2003. A formal order for relief was entered in the case on Nov. 19, 2003. On June 17, 2004, the bankruptcy court entered an order confirming the Plan of Reorganization. On March 22, 2006, LitFunding filed a motion seeking a final decree. "As a result of meeting our obligations pursuant to the Plan of Reorganization, the court has ordered our final decree, and our reorganization case closed," Morton Reed, CEO of LitFunding, stated. According to Mr. Reed, LitFunding has been pursuing completion of its Imperial line of financing and developing its new line of business through the recently acquired subsidiary, Easy Money Express. Mr. Reed further stated, "As a result of our emergence from bankruptcy, we anticipate greater focus on our business, and a greater ability to finance our business opportunities. The cost of the bankruptcy, the cost of administering the bankruptcy, and the cost of lost business opportunities has been significant. We are now focused, without the distraction and cost of the bankruptcy. For those stockholders who have stayed with us during this most trying time, we appreciate your loyalty. It is now time for us to demonstrate our appreciation for that loyalty." About LitFunding Corp. LitFunding Corp. (OTC Bulletin Board: LFDG), provides non-recourse cash advance funding to law firms and plaintiffs' attorneys. The company advanced many millions of dollars over the past few years towards a variety of cases. Typical advances have ranged between $10,000 and $2,000,000. As reported in the Troubled Company Reporter on Aug. 23, 2004, LitFunding Corp. and its subsidiary, California LitFunding, both Nevada corporations reported that their Second Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code was confirmed by the United States Bankruptcy Court, Central District of California, Los Angeles Division, on May 26, 2004. The order confirming that ruling was entered into the court record on June 17, 2004 and became effective on June 21, 2004. LOVESAC CORP: Court Approves CapitalLink LC as Investment Banker ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized The LoveSac Corporation and its debtor-affiliates to employ CapitalLink L.C. as its investment banker. CapitalLink is expected to: (a) develop a process for a sale to potential strategic and financial buyers with the objective of maximizing the value of the Debtors' assets; (b) assist the Debtors in the preparation of selling documents; (c) make contact with and pre-qualifying parties interested in undertaking a Transaction; (d) distribute selling documents and providing the Debtors with periodic progress reports; (e) assist in the guidance of the due diligence process; (f) collect term sheets and, if requested, negotiating with interested parties; and (g) take other steps to complete a Transaction. CapitalLink will receive a nonrefundable monthly retainer of $25,000. Additionally, in the event that the Debtors: (i) effectuate any merger, consolidation, reorganization, recapitalization, business combination or other transaction pursuant to which the Debtors are required by, combined with, or enter into a joint venture with, another party, or (ii) effectuate any transaction whereby the Debtors undertakes a sale or divestiture of all or substantially all their current business or assets to a third party, during the Term or within one year of the end of the Term, regardless of the reason for termination of the Agreement, then the Debtors will pay CapitalLink, upon closing of each Transaction, an additional cash fee based on these formula: * 5% of the value of the transaction from $1 to $2 million; * 4% of the value of the transaction from $2 to $4 million; * 3% of the value of the transaction from $4 to $6 million; or * 2% of the value of the transaction in excess of $6 million. James S. Cassel, president of CapitalLink, assures the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not hold or represent any interest adverse to the Debtors' estates. Headquartered in Salt Lake City, Utah, The LoveSac Corporation -- http://www.lovesac.com/-- operates and franchises retail stores selling beanbags furniture. The LoveSac Corp. and three affiliates filed for chapter 11 protection on Jan. 30, 2006 (Bankr. D. Del. Case No. 06-10080). Anthony M. Saccullo, Esq., and Charlene D. Davis, Esq., at The Bayard Firm and P. Casey Coston, Esq., at Squire, Sanders & Dempsey LLP represent the Debtors in their restructuring efforts. Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg & Ellers represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they estimated assets and debts between $10 million to $50 million. LUCENT TECH: Gets Early Termination of Merger Waiting Period ------------------------------------------------------------ On June 7, 2006, Lucent Technologies Inc. and Alcatel were notified that they had received early termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, with respect to the proposed merger transaction involving Lucent and Alcatel. The merger, which is expected to be completed within six to twelve months of the date of the merger agreement entered into on April 2, 2006, remains subject to additional customary regulatory and governmental reviews in the United States, Europe and elsewhere, as well as the approval by shareholders of both Lucent and Alcatel and other customary conditions. About Lucent Technologies Headquartered in Murray Hill, New Jersey, Lucent Technologies -- http://www.lucent.com/-- designs and delivers the systems, services and software that drive next-generation communications networks. Backed by Bell Labs research and development, Lucent uses its strengths in mobility, optical, software, data and voice networking technologies, as well as services, to create new revenue-generating opportunities for its customers, while enabling them to quickly deploy and better manage their networks. Lucent's customer base includes communications service providers, governments and enterprises worldwide. * * * As reported in the Troubled Company Reporter on April 7, 2006, Moody's Investors Service placed Lucent Technologies, Inc.'s B1 corporate family rating, B1 senior unsecured rating, B3 subordinated rating, and B3 trust preferred rating under review for possible upgrade following the company's announcement of a definitive merger agreement with Alcatel. MAAX CORP: Weak Liquidity Prompts S&P to Downgrade Ratings ---------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Quebec-based bathroom fixtures manufacturer MAAX Holdings Inc. to 'CCC+' from 'B-'. At the same time, Standard & Poor's lowered its rating on the company's senior discount notes to 'CCC-' from 'CCC'. The long-term corporate credit rating on subsidiary MAAX Corp. was also lowered to 'CCC+' from 'B-'. In addition, Standard & Poor's lowered its ratings on the subsidiary's secured bank facilities to 'CCC+' from 'B-', with a recovery rating of '3', and on the subsidiary's senior subordinated debt notes to 'CCC-' from 'CCC'. The outlook is negative. "The ratings on MAAX were lowered because of weak liquidity and continuing concerns about profitability," said Standard & Poor's credit analyst Dan Parker. "MAAX's margins have been squeezed by high raw material costs, such as resin and acrylic, and the appreciation of the Canadian dollar. The company's efforts to cut costs and restructure operations should help improve earnings, but its onerous debt load means it is struggling to stay onside of its bank covenants," Mr. Parker added. MAAX is a midsize manufacturer and distributor of gel-coated, acrylic, and hermoplastic bathtubs, showers, and whirlpools, with an approximate 15% share of the North American market. It also manufactures semi-custom cabinetry (kitchen and bathroom) and spas. The company has restructured operations to reduce its costs and Canadian dollar exposure but, nevertheless, the high Canadian dollar will continue to have a negative effect on margins. Profitability will also be susceptible to the slowdown in home renovation activity, and potentially increased competitive behavior from larger competitors. The outlook is negative. The company will continue to be affected by cost pressures, currency changes, and tough competition in each of its markets. The company's cash generation will need to improve to satisfy the onerous debt load. The $7 million equity injection will help alleviate tight liquidity but the company may have trouble satisfying its financial covenants if cash flow and earnings do not improve from the quarter ended Feb. 28, 2006. Nevertheless, the business profile could support somewhat higher ratings if debt leverage were lower. MAAX HOLDINGS: Weak Liquidity Prompts S&P to Junk Ratings --------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Quebec-based bathroom fixtures manufacturer MAAX Holdings Inc. to 'CCC+' from 'B-'. At the same time, Standard & Poor's lowered its rating on the company's senior discount notes to 'CCC-' from 'CCC'. The long-term corporate credit rating on subsidiary MAAX Corp. was also lowered to 'CCC+' from 'B-'. In addition, Standard & Poor's lowered its ratings on the subsidiary's secured bank facilities to 'CCC+' from 'B-', with a recovery rating of '3', and on the subsidiary's senior subordinated debt notes to 'CCC-' from 'CCC'. The outlook is negative. "The ratings on MAAX were lowered because of weak liquidity and continuing concerns about profitability," said Standard & Poor's credit analyst Dan Parker. "MAAX's margins have been squeezed by high raw material costs, such as resin and acrylic, and the appreciation of the Canadian dollar. The company's efforts to cut costs and restructure operations should help improve earnings, but its onerous debt load means it is struggling to stay onside of its bank covenants," Mr. Parker added. MAAX is a midsize manufacturer and distributor of gel-coated, acrylic, and hermoplastic bathtubs, showers, and whirlpools, with an approximate 15% share of the North American market. It also manufactures semi-custom cabinetry (kitchen and bathroom) and spas. The company has restructured operations to reduce its costs and Canadian dollar exposure but, nevertheless, the high Canadian dollar will continue to have a negative effect on margins. Profitability will also be susceptible to the slowdown in home renovation activity, and potentially increased competitive behavior from larger competitors. The outlook is negative. The company will continue to be affected by cost pressures, currency changes, and tough competition in each of its markets. The company's cash generation will need to improve to satisfy the onerous debt load. The $7 million equity injection will help alleviate tight liquidity but the company may have trouble satisfying its financial covenants if cash flow and earnings do not improve from the quarter ended Feb. 28, 2006. Nevertheless, the business profile could support somewhat higher ratings if debt leverage were lower. MASTERCRAFT INTERIORS: Hires Shulman Rogers as Bankruptcy Counsel ----------------------------------------------------------------- The United States Bankruptcy Court for the District of Maryland gave Mastercraft Interiors, Ltd., and Kimels of Rockville, Inc., authority to hire Shulman, Rogers, Gandal, Pordy & Ecker, P.A., as their bankruptcy counsel. As reported in the Troubled Company Reporter on May 22, 2006, Shulman Rogers is expected to: a. provide the Debtors with legal advice with respect to their powers and duties in the operation of their businesses and the management of their properties pursuant to the Bankruptcy Code; b. prepare on behalf of the Debtors all necessary applications, answers, orders, reports and other legal papers; c. assist in analyses and representation with respect to lawsuits to which the Debtors are or may be a party; d. negotiate, prepare, file and seek confirmation of a plan of reorganization; e. represent the Debtors at all hearings, meetings of creditors and other proceedings; and f. perform all other legal services for the Debtors which may be necessary to serve the Debtors' best interests. Morton A. Faller, Esq., a shareholder at Shulman Rogers, tells the Bankruptcy Court that his firm's professionals charge these hourly rates: Professional Hourly Rate ------------ ----------- Attorneys $195 to $425 Legal Assistants/Law Clerks $135 to $170 The firm's principal attorneys who will render material services charge these hourly rates: Attorneys Hourly Rate ------------ ----------- Morton A. Faller, Esq. $395 Michael J. Lichtenstein, Esq. $395 Stephen A. Metz, Esq. $245 The Debtors paid the firm a $100,000 retainer. Mr. Faller assures the Court that his firm and its professionals do not hold material interest adverse to the Debtors' interests and are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Beltsville, Maryland, Mastercraft Interiors Ltd., -- http://www.mastercraftinteriors.com/-- manufactures high- quality furniture and other home furnishings. The Company and its subsidiary, Kimels of Rockville, Inc., filed for bankruptcy on May 15, 2006, (Bankr. D. Md. Case No. 06-12769). Morton A. Faller, Esq., Michael J. Lichtenstein, Esq., and Stephen A. Metz, Esq., at Shulman, Rogers, Gandal, Pordy & Ecker, P.A., represent the Debtors in their restructuring efforts. Bradford F. Englander, Esq., at Linowes and Blocher LLP, represents the Official Committee of Unsecured Creditors. When they filed for bankruptcy, Mastercraft Interiors reported assets amounting to $10,600,288 and debts amounting to $25,485,847 while Kimels of Rockville reported assets totaling $704,227 and debts amounting to $10,341,704. MERIDIAN AUTOMOTIVE: Wants Watson Wyatt as Actuary -------------------------------------------------- Meridian Automotive Systems, Inc., and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Watson Wyatt & Company, nunc pro tunc to May 27, 2006, to provide actuary valuations with respect to their retirement, pension and welfare benefit plans, as necessary to perform the Debtors' "fresh start" accounting. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, tells the Court that the Debtors need appraisal and actuarial services for use in connection with their "fresh start" accounting, as they near emergence from Chapter 11. The Debtors must prepare actuary valuations of their pension and retiree healthcare plans to estimate their liabilities under their plan of reorganization as of the Effective Date, Mr. Brady explains. Mr. Brady relates that Watson Wyatt has been the Debtors' actuary analyst since 1999, and has been retained as an ordinary course professional in the Debtors' Chapter 11 cases. Watson Wyatt will prepare actuarial valuations to reflect the liabilities of these plans, which are sponsored by the Debtors: (a) Composites Operations, Inc., Retirement Plan for Hourly-Rated Employees of the Reinforced Plastics Operations at Centralia, Illinois; (b) Composites Operations, Inc., Pension Plan for Bargaining Unit Employees at Jackson, Ohio; (c) Welfare Benefit Plan for Centralia, Illinois; (d) Welfare Benefit Plan for Ionia Gencorp Bargaining Unit Retired Associates; (e) Welfare Benefit Plan for Jackson, Ohio Bargaining Unit Associates; and (f) Welfare Benefit Plan for Grand Rapids Operations Retired Associates. The valuations to be performed by Watson Wyatt will include measurements of the Debtors' liabilities both pre-emergence and post-emergence reflecting current economic assumptions. Pension and post-retirement benefit expenses will also be determined for the period from the date of emergence to December 31, 2006. Mr. Brady notes that the Actuarial Valuations are distinct from the actuarial services Watson Wyatt provides to the Debtors in the ordinary course of business. Watson Wyatt will continue to serve as an ordinary course professional in their Chapter 11 cases, Mr. Brady says. Watson Wyatt's hourly rates are: Professional Hourly Rate ------------ ----------- Senior Consultants & Senior Consulting $450 to $650 Actuaries Consultants & Consulting Actuaries $325 to $425 Actuaries $300 to $400 Analysts & Supporting Staff $140 to $300 Watson Wyatt does not anticipate that its fees in connection with the proposed engagement will exceed $75,000, Marshall L. Walters, a consultant at Watson Wyatt, assures the Court. Mr. Walters attests that Watson Wyatt has no connection: * with the Debtors, their creditors, equity holders, other parties-in-interest or their attorneys; and * to the U.S. Trustee or any person employed in the office of the U.S. Trustee in the District of Delaware. According to Mr. Walters, Watson Wyatt: (a) is not a creditor, equity security holder or insider of the Debtors; (b) is not and was not an investment banker for any outstanding security of the Debtors; (c) has not been, within three years before the Petition Date: * an investment banker for a security of the Debtors; or * an attorney for that investment banker in connection with the offer, sale, or issuance of a security of the Debtors; and (d) was not, within two years before the Petition Date, a director, officer, or employee of the Debtors or of any investment banker. In addition, Mr. Walters continues, Watson Wyatt neither holds nor represents any interest adverse to the Debtors, within the meaning of Section 327(a). About Meridian Automotive Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 29; Bankruptcy Creditors' Service, Inc., 215/945-7000). MERIDIAN AUTOMOTIVE: Likely Lenders & Debtors Tap Hilco Appraisal ----------------------------------------------------------------- Meridian Automotive Systems, Inc., and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Hilco Appraisal Services, LLC, as appraiser, nunc pro tunc to May 26, 2006. The Debtors want Hilco to appraise their inventory, machinery and equipment, and real property. The Debtors and their potential exit lenders have agreed to retain one set of mutually agreed upon appraisers, which will be paid for by the Debtors. Hilco will perform separate machinery and equipment appraisals for the Prospective Lenders and the Debtors. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, relates that the Prospective Lenders' appraisal, to be used in connection with the Exit Facility due diligence, will focus on various machinery and equipment at various locations, assigning the machinery and equipment an "orderly liquidation value." Hilco will physically appraise the Debtors' machinery and equipment located at: Location Size in Sq. Ft. -------- --------------- Ionia, Michigan 650,318 Ionia, Michigan 94,700 Grabill, Indiana 447,000 Huntington, Indiana 180,000 Shelbyville, Indiana 432,000 Lenoir, North Carolina 131,091 Kentwood, Michigan (Plant #1) 207,000 Kentwood, Michigan (Plant #5) 244,000 Kentwood, Michigan (Plant #7) 268,000 Kentwood, Michigan (29th St.) 52,000 Angola, Indiana 115,000 Angola, Indiana 73,000 Canton, Michigan 120,000 Detroit, Michigan 306,000 Detroit, Michigan 67,765 Kansas City, Kansas 200,000 Shreveport, Louisiana 72,000 Brantford, Ontario 172,000 Rushville, Indiana 97,000 Salisbury, North Carolina 282,000 Grabill, Indiana (SMC) 62,000 Fowlerville, Michigan 234,000 Newton, North Carolina 65,000 Jackson, Ohio 217,000 The appraisal to be used by the Debtors in connection with their fresh start accounting will also focus on those machinery and equipment, assessing their "fair value" in accordance with Statement of Position No. 90-7: Location Size in Sq. Ft. -------- --------------- Ionia, Michigan 650,318 Ionia, Michigan 94,700 Grabill, Indiana 447,000 Huntington, Indiana 180,000 Shelbyville, Indiana 432,000 Lenoir, North Carolina 131,091 Kentwood, Michigan (Plant #1) 207,000 Kentwood, Michigan (Plant #5) 244,000 Kentwood, Michigan (Plant #7) 268,000 Kentwood, Michigan (29th St.) 52,000 Angola, Indiana 115,000 Angola, Indiana 73,000 Canton, Michigan 120,000 Detroit, Michigan 306,000 Detroit, Michigan 67,765 Kansas City, Kansas 200,000 Shreveport, Louisiana 72,000 Brantford, Ontario 172,000 Rushville, Indiana 97,000 Salisbury, North Carolina 282,000 Grabill, Indiana (SMC) 62,000 Fowlerville, Michigan 234,000 Newton, North Carolina 65,000 Jackson, Ohio 217,000 Muzquiz, Mexico 220,000 Celaya, Mexico 102,000 Rio Claro, Brazil 226,000 Hilco will perform an orderly liquidation value appraisal of the Debtors' inventory, to be used as part of the Prospective Lenders' due diligence, delineated between raw materials, work- in-progress, and finished good inventory categories, Mr. Brady tells the Court. With respect to the Debtors' real estate, Hilco will estimate the market value of several of the Debtors' properties located in the United States. This appraisal will be used in connection with the Debtors' fresh start accounting. The Debtors propose to pay Hilco a flat fee for each of these appraisals: Appraisal Fee --------- --- Inventory $48,500 Machinery & Equipment $138,000 Real Estate $76,500 On the Court's approval, the Debtors will pay Hilco a $50,000 retainer, which will be applied to the total fees charged by Hilco. Andrew Dahlman, senior vice president of Hilco Appraisal Services, LLC, assures the Court that: * Hilco has no connection with, and holds no interest adverse to, the Debtors or their estates in the matters on which Hilco is proposed to be engaged, except as disclosed; * Hilco does not hold any prepetition claims against the Debtors and as a result, it is not a "creditor" of the Debtors within the meaning of Section 101(10) of the Bankruptcy Code; and * Hilco is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Meridian Automotive Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 29; Bankruptcy Creditors' Service, Inc., 215/945-7000). MERIDIAN AUTOMOTIVE: Wants BDO Seidman's Scope of Work Expanded --------------------------------------------------------------- In connection with their anticipated emergence from Chapter 11, Meridian Automotive Systems, Inc., and its debtor-affiliates seek to expand the scope of BDO Seidman, LLP's retention as accountants and auditors, nunc pro tunc to May 26, 2006. BDO's services will include an audit of the Debtors' opening consolidated balance sheet as of June 30, 2006, or upon emergence from Chapter 11, Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, tells the Court. According to Mr. Brady, BDO does not anticipate that its fees for performing the Supplemental Services will exceed $150,000 to $175,000. Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 29; Bankruptcy Creditors' Service, Inc., 215/945-7000). MIRANT CORPORATION: Withdraws Proposal to Acquire NRG Energy ------------------------------------------------------------ Mirant Corporation withdrew its proposal to acquire NRG Energy, Inc. "We are disappointed that NRG was unwilling to sit down with us to discuss what would have been a compelling opportunity to create significant value for both companies' shareholders," Mirant Chairman and Chief Executive Officer Edward R. Muller said. "It is clear, however, that a long and contested pursuit is not in the best interests of Mirant and its shareholders and, as a result, we are withdrawing our proposal to acquire NRG. We will continue our efforts to create value for Mirant's shareholders." NRG Energy, Inc., released a statement regarding Mirant's withdrawn proposal, saying: "Over the past 24 months, NRG's stock has appreciated 120% as the market has recognized the value of our asset mix, the soundness of our strategy and our history of returning capital to shareholders. We are poised for further value creation and look forward to the continued execution of our strategic plan." About NRG Energy Headquartered in Princeton, New Jersey, NRG Energy, Inc. -- http://www.nrgenergy.com/-- currently owns and operates a diverse portfolio of power-generating facilities, primarily in the Northeast, South Central and Western regions of the United States. Its operations include baseload, intermediate, peaking, and cogeneration facilities, thermal energy production and energy resource recovery facilities. NRG also has ownership interests in generating facilities in Australia and Germany. About Mirant Corp. Headquartered in Atlanta, Georgia, Mirant Corporation (NYSE: MIR) -- http://www.mirant.com/-- is a competitive energy company that produces and sells electricity in North America, the Caribbean, and the Philippines. Mirant owns or leases more than 18,000 megawatts of electric generating capacity globally. Mirant Corporation filed for chapter 11 protection on July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the terms of a confirmed Second Amended Plan on January 3, 2006. Thomas E. Lauria, Esq., at White & Case LLP, represented the Debtors in their successful restructuring. Shearman & Sterling LLP represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $20,574,000,000 in assets and $11,401,000,000 in debts. (Mirant Bankruptcy News, Issue No. 98; Bankruptcy Creditors' Service, Inc., 215/945-7000) * * * As reported in the Troubled Company Reporter on Dec. 8, 2005, Standard & Poor's Ratings Services placed a 'B+' corporate credit rating on Mirant Corporation and said the outlook is stable. ML-CFC COMMERCIAL: S&P Assigns Low-B Ratings on Six Cert. Classes ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to ML-CFC Commercial Mortgage Trust 2006-2's $1.841 billion commercial mortgage pass-through certificates series 2006-2. The preliminary ratings are based on information as of June 12, 2006. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect the credit support provided by the subordinate classes of certificates, the liquidity provided by the trustee, the economics of the underlying loans, and the geographic and property type diversity of the loans. Class A-1, A-2, A-3, A- SB, A-4, A-1A, AM, and AJ are currently being offered publicly. The remaining classes will be offered privately. Standard & Poor's analysis determined that, on a weighted average basis, the pool has a debt service coverage of 1.36x, a beginning LTV of 98.4%, and an ending LTV of 87.8%. Preliminary Ratings Assigned ML-CFC Commercial Mortgage Trust 2006-2 Preliminary Recommended credit Class Rating amount support (%0) ----- ------ ---------- ------------------ A-1 AAA $53,845,000 30.000 A-2 AAA $88,159,000 30.000 A-3 AAA $54,481,000 30.000 A-SB AAA $91,905,000 30.000 A-4 AAA $734,750,000 30.000 A-1A AAA $265,873,000 30.000 AM AAA $184,145,000 20.000 AJ AAA $138,108,000 12.500 B AA $36,829,000 10.500 C AA- $16,113,000 9.625 D A $32,225,000 7.875 E A- $18,415,000 6.875 F BBB+ $29,923,000 5.250 G BBB $18,415,000 4.250 H BBB- $20,716,000 3.125 J BB+ $9,207,000 2.625 K BB $4,604,000 2.375 L BB- $6,905,000 2.000 M B+ $2,302,000 1.875 N B $4,604,000 1.625 P B- $4,603,000 1.375 Q NR $25,320,786 0.000 X* AAA $1,841,447,786 N/A * Interest - only class with a notional amount. NR -- Not rated. N/A -- Not applicable. MOUNT SKYLIGHT: Moody's Rates $9.5 Mil. Subordinated Notes at Ba2 ----------------------------------------------------------------- Moody's announced assigned ratings to the following five classes of notes issued by Mount Skylight CDO Ltd. Teachers Advisors, Inc. is the Issuer's collateral manager. * Aaa to the $890,000,000 Class A-1 Floating Rate Notes Due 2046; * Aaa to the $51,500,000 Class A-2 Floating Rate Notes Due 2046; * Aa2 to the $30,000,000 Class B Floating Rate Notes Due 2046; * A2 to the $14,000,000 Class C Deferrable Interest Floating Rate Notes Due 2046; and * Baa2 to the $5,000,000 Class D Deferrable Interest Floating Rate Notes Due 2046. Moody's ratings of these notes address the ultimate cash receipt of all interest and principal payments required by the notes' governing documents, and are based on the expected loss posed to holders of the notes relative to the promise of receiving the present value of such payments. Moody's also assigned a rating to the Issuer's Subordinated Notes: * Ba2 to the $9,500,000 Subordinated Notes Due 2046. Moody's noted that this rating addresses return of principal only. MUELLER WATER: IPO Prompts S&P to Lift Rating and Remove Watch -------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Decatur, Illinois-based Mueller Water Products Inc. to 'BB-' from 'B+'. In addition, all ratings were removed from CreditWatch with positive implications were they were placed on Feb. 6, 2006, following the announcement by Mueller's parent company, Walter Industries Inc., that it would offer Mueller shares in an IPO. The outlook is stable. "The one notch upgrade reflects Mueller's less levered capital structure after raising about $432 million of net proceeds in an initial share offering," said Standard & Poor's analyst Clarence Smith. Proceeds will be used to reduce debt under the company's senior secured credit facilities and to fund redemption of a portion of the currently outstanding subordinated notes announced by the company. NEW SEABURY: 1st Cir. Says $550K of Disputed Funds Aren't Debtor's ------------------------------------------------------------------ New Seabury Company Limited Partnership -- a limited partnership which owned and operated a 2,000 acre planned resort community on Nantucket Sound in Mashpee, Massachusetts -- sought chapter 11 protection on March 31, 1997. During its chapter 11 proceedings, the Debtor and New Seabury Properties, LLC, offered competing plans for reorganization of the Debtor. On May 15, 1998, the bankruptcy court entered an Order and Preliminary Decision stating that the Debtor's plan was not confirmable, but New Seabury Properties, LLC's was. For two days leading up to the confirmation hearing on May 29, 1998, the Debtor and New Seabury Properties, LLC, engaged in negotiations to resolve the differences between their competing plans. Ultimately, on May 29, 1998, the parties executed a stipulation, pursuant to which the Debtor withdrew its plan of reorganization. That paved the way for New Seabury Properties, LLC, to buy the Debtor's assets under its chapter 11 plan. At the closing, a dispute arose about whether the Debtor or the asset purchaser was entitled to $550,000 of cash generated on account of brokerage commissions. Everybody agreed to park the funds in an escrow account and sort it out later. Eight years later, the United States Court of Appeals for the First Circuit -- after an initial order from the Bankruptcy Court, an appeal to the U.S. District Court for the District of Massachusetts, remand to the Bankruptcy Court, a trip back to the District Court, a second remand to the Bankruptcy Court, a second order from the Bankruptcy Court, and the District Court affirming that second order -- rules that the asset purchaser will take all of the cash. The First Circuit says the plain language of the May 29 Stipulation entered into in the context of a plan confirming a chapter 11 plan, does not support a conclusion that the funds were intended to be retained by the debtor. A full-text copy of the decision is available at no charge at http://laws.lp.findlaw.com/1st/051526.html NORAMPAC INC: Moody's Assigns Ba2 Rating on C$325 Million Loan -------------------------------------------------------------- Moody's Investors Service downgraded Norampac Inc.'s corporate family rating to Ba3 from Ba2, assigned a Ba2 rating to its C$325 million senior secured five-year revolver and downgraded its senior unsecured debt ratings to B1. The downgrade of the corporate family rating to Ba3 reflects the significant deterioration in the company's cash flow and debt protection measurements that have resulted principally from the significant increase in the value of the Canadian dollar, as well as higher fiber, energy and other input costs. Moody's believes that the impact of the Canadian dollar on Norampac's results will not lessen in the next two to three years and that the company's cash flow and debt protection measurements will remain near current levels during this period. The downgrade of the company's senior unsecured notes by two notches to B1 reflects the security granted to the revolver lenders, the magnitude of the revolving credit facility and expected outstanding secured debt in relation to the unsecured notes, and the subordination of the unsecured creditors to the secured debt. The rating outlook is stable. Downgrades: Issuer: Norampac Inc. * Corporate Family Rating, Downgraded to Ba3 from Ba2 * Senior Unsecured Regular Bond/Debenture, Downgraded to B1 from Ba2 Assignments: Issuer: Norampac Inc. * Senior Secured Bank Credit Facility, Assigned Ba2 Withdrawals: Issuer: Norampac Inc. * Senior Secured Bank Credit Facility, Withdrawn, previously rated Ba1 * Senior Unsecured Regular Bond/Debenture, Withdrawn, previously rated Ba2 The last rating action for Norampac was the assignment of a Ba2 corporate family rating in May 2003. Headquartered in Montreal, Quebec, Norampac is the largest containerboard producer in Canada and the 7th largest in North America. Norampac is a joint venture company, owned by Cascades Inc. and Domtar Inc. and had sales in the year ended December 31, 2005 of C$1.3 billion. NRG ENERGY: Resumes Growth Plan Despite Mirant's Withdrawn Offer ---------------------------------------------------------------- Mirant Corporation withdrew its proposal to acquire NRG Energy, Inc. "We are disappointed that NRG was unwilling to sit down with us to discuss what would have been a compelling opportunity to create significant value for both companies' shareholders," Mirant Chairman and Chief Executive Officer Edward R. Muller said. "It is clear, however, that a long and contested pursuit is not in the best interests of Mirant and its shareholders and, as a result, we are withdrawing our proposal to acquire NRG. We will continue our efforts to create value for Mirant's shareholders." NRG Energy, Inc., released a statement regarding Mirant's withdrawn proposal, saying: "Over the past 24 months, NRG's stock has appreciated 120% as the market has recognized the value of our asset mix, the soundness of our strategy and our history of returning capital to shareholders. We are poised for further value creation and look forward to the continued execution of our strategic plan." As reported in the Troubled Company Report on May 31, 2006, NRG Energy's Board has found Mirant's proposal deficient in at least three key respects: * the offer significantly undervalues NRG; * concerns about Mirant's value and stock's relative lack of liquidity and trading history makes Mirant's stock an unacceptable currency; and, * finally, having taken into account trends and developments in the wholesale power generation sector, the Board does not believe this is the appropriate time to engage in a sale process. About Mirant Corp. Headquartered in Atlanta, Georgia, Mirant Corporation (NYSE: MIR) -- http://www.mirant.com/-- is a competitive energy company that produces and sells electricity in North America, the Caribbean, and the Philippines. Mirant owns or leases more than 18,000 megawatts of electric generating capacity globally. Mirant Corporation filed for chapter 11 protection on July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the terms of a confirmed Second Amended Plan on January 3, 2006. Thomas E. Lauria, Esq., at White & Case LLP, represented the Debtors in their successful restructuring. Shearman & Sterling LLP represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $20,574,000,000 in assets and $11,401,000,000 in debts. About NRG Energy Headquartered in Princeton, New Jersey, NRG Energy, Inc. -- http://www.nrgenergy.com/-- currently owns and operates a diverse portfolio of power-generating facilities, primarily in the Northeast, South Central and Western regions of the United States. Its operations include baseload, intermediate, peaking, and cogeneration facilities, thermal energy production and energy resource recovery facilities. NRG also has ownership interests in generating facilities in Australia and Germany. NRG ENERGY: Mirant Bid Withdrawal Prompts S&P to Remove Watch ------------------------------------------------------------- Standard & Poor's Ratings Services removed its 'B-2' short-term corporate credit rating on NRG Energy Inc. from CreditWatch with negative implications, where it was placed on June 1, 2006. This rating action follows Mirant Corp.'s (B+/Stable/--) withdrawal of an unsolicited bid to acquire NRG for about $7.9 billion in cash and stock. The long-term corporate credit rating on NRG is affirmed at 'B+'. The outlook on all ratings is stable. The short-term corporate credit rating was placed on CreditWatch with negative implications because, in Standard & Poor's opinion, the proposed Mirant transaction, if successful, might erode or even possibly exhaust NRG's liquidity cushion. As this is no longer a concern, S&P is affirming the 'B-2' short-term corporate credit rating. The stable outlook reflects S&P's view that NRG's credit quality should not significantly deteriorate in the short term. In the near term, NRG should continue to benefit from high commodity prices and the hedges the company has in place at Texas Genco LLC. "If NRG successfully integrates the Texas Genco acquisition, commodity prices remain high, and NRG deleverages its capital structure as it has presented in its base case, Standard & Poor's could revise the outlook to positive or raise the company's credit ratings," said Standard & Poor's credit analyst David Bodek. "On the other hand, if the company continues a growth strategy financed with debt and cash flows deteriorate, Standard & Poor's could revise the outlook to negative or lower the ratings," he continued. Longer term, NRG remains exposed to the high business risk of operating primarily as a merchant generator, where cash flows may be volatile, which will limit upgrade potential. O'SULLIVAN INDUSTRIES: Sentry Wants Claim Objection Denied ---------------------------------------------------------- As reported in the Troubled Company Reporter on April 13, 2006, O'Sullivan Industries Holdings, Inc., and its debtor-affiliates asked the U.S. Bankruptcy Court for the Northern District of Georgia's to disallow, expunge or estimate Sentry Insurance's claim. Sentry Responds Sentry asks the Court to deny the Debtors' Objection concerning its Claim. On December 28, 2005, Sentry Insurance filed a secured claim for $3,430,000, and an unsecured, non-priority claim of $988,164, against the Debtors, Sharon M. Lewonski, Esq., at Weinstock & Scavo, in Atlanta, Georgia, relates. The total Sentry Claim is for $4,418,164. Ms. Lewonski tells the Court that Sentry's Claim is based on: -- its issuance of various workers compensation and employers' liability policies to the Debtors; and -- losses, expenses and additional amounts that it will pay pursuant to the terms of the policies. If Sentry is required to make a single sum present value calculation of amounts due under the policies, the Debtors will likely owe Sentry, over time, an amount equal to the secured claim plus an additional $988,164, Ms. Lewonski says. Ms. Lewonski asserts that Sentry is entitled to the unsecured payments set forth in its Claim in accordance with the Debtors' performance obligations under the policies. Although the Debtors are current in the amounts due and owing pursuant to the workers compensation insurance plans, Sentry demands assurance of the Debtors' future performance. 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). Joel H. Levitin, Esq., at Dechert LLP, represents the Debtors. Michael H. Goldstein, Esq., Eric D. Winston, Esq., and Christine M. Pajak, Esq., at Stutman, Treister & Glatt, P.C., represent the Official Committee of Unsecured Creditors. On Sept. 30, 2005, the Debtor listed $161,335,000 in assets and $254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service, Inc., 215/945-7000) PERFORMANCE TRANSPORTATION: Ford Wants to Enforce Lease Rights -------------------------------------------------------------- Prior to filing for bankruptcy, Performance Transportation Services, Inc., and its debtor-affiliates entered into lease agreements with Ford Motor Credit Company pursuant to which the Debtors rent certain motor vehicles. Since Jan. 30, 2006, Ford Motor had not sent the Debtors invoices for payments due under the Leases. Ford Motor believes that sending the invoices would be a violation of the automatic stay under Section 362 of the Bankruptcy Code. However, Ford Motor complains that the Debtors have made no provision to adequately protect its interest in the vehicles. The Debtors also have not sought assumption or rejection of the leases, Gabriel J. Ferber, Esq., at Nesper Ferber & DiGiacomo, LLP, in Amherst, New York, tells the Court. Ford Motor asserts the subject vehicles are depreciating in value, given the Debtors' use. Mr. Ferber says that as of April 25, 2006, the Debtors owe Ford Motor $14,365 in unpaid balances under the Leases: Debtor Past Due Date Arrears ------ ------------- ------- E. and L. Transport 12/28/05 $2,033 Hadley Auto Transport 01/27/06 814 Transportation Releasing LLC 01/22/06 1,696 Transportation Releasing LLC 02/17/06 1,522 Transportation Releasing LLC 01/30/06 1,258 Transportation Releasing LLC 01/30/06 1,254 Transportation Releasing LLC 01/22/06 1,696 Transportation Releasing LLC 02/17/06 1,363 Transportation Releasing LLC 02/17/06 1,363 Performance Transportation 01/30/06 1,366 In the absence of cure and assumption of the leases, Ford Motor asks Judge Kaplan to lift the automatic stay to permit it to proceed with the enforcement of its rights with respect to the leases. Alternatively, Ford Motor asks the Court to direct the Debtors to cure and assume the Leases. Parties Resolve Stay Issue In a stipulation, Ford Motor and the Debtors agree that: a. Ford Motor will provide the Debtors with invoices for the outstanding postpetition amounts; b. the Debtors will pay all outstanding postpetition amounts due under the Leases within 15 days after their receipt of the invoices; c. if the Debtors fail to pay the outstanding postpetition amounts within the 15-day period, the automatic stay will be lifted to allow Ford Motor to exercise its rights against the vehicles subject to the Leases; d. Ford Motor is authorized to invoice the Debtors for future postpetition amounts that arise during their Chapter 11 cases; e. the Debtors will pay any future postpetition amounts under the Leases as the amounts become due and in the ordinary course to the extent they continue to receive the benefits under the Leases; f. if the Debtors default in their payment obligations under the Leases, the automatic stay will be lifted to allow Ford Motor to exercise its rights against the vehicles subject to the Leases with respect to which the Debtors have defaulted and have not promptly cure the defaults; g. the payments of the postpetition amounts are deemed as adequate protection for the benefit of Ford Motor; h. Ford will withdraw its stay request; and i. the Debtors will make a decision to assume or reject the Leases by a date that is no later than the effective date of a confirmed Chapter 11 plan of reorganization. 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). James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A. Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq., at Hodgson Russ LLP represent the Debtors in their restructuring efforts. David Neier, Esq., at Winston & Strawn LLP, represents the Official Committee of Unsecured Creditors. 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. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) PERFORMANCE TRANSPORTATION: Lease Decision Period Moved to Aug. 23 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Western District of New York extends the time within which Performance Transportation Services, Inc., and its debtor-affiliates must assume or reject their unexpired leases to and including Aug. 23, 2006. As reported in the Troubled Company Reporter on May 24, 2006, the Debtors are parties to over 30 unexpired nonresidential real property leases. Among others, the Debtors' headquarters and substantially all of their terminals are located on leased property. Sven T. Nylen, Esq., at Kirkland & Ellis LLP, at Chicago, Illinois, related that the terminals, represent a critical component of the Debtors' operations. He said that the Debtors' ultimate business plan, on which the reorganization will also focus, will determine which terminals must be retained. To develop a framework for the design of a new business plan, the Debtors must complete negotiations with their customers and labor unions. Until they determine how these negotiations might affect their financial outlook, the Debtors cannot determine the profitability of the Unexpired Leases on an individual basis. 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). James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A. Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq., at Hodgson Russ LLP represent the Debtors in their restructuring efforts. David Neier, Esq., at Winston & Strawn LLP, represents the Official Committee of Unsecured Creditors. 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. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) PERFORMANCE TRANSPORTATION: Hires Reed Smith as Special Counsel --------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of New York authorized Performance Transportation Services, Inc., to employ Reed Smith LLP as its special counsel, nunc pro tunc to March 23, 2006. The firm will: a. advise and represent PTS with respect to all issues involving or relating to its collective bargaining agreements; b. advise and represent PTS with respect to all issues relating to all pension plans, health plans and other employee benefits for both active and retired employees; c. advise and represent PTS with respect to any issues involving compensation of its hourly and salaried workforce; and d. perform all necessary or appropriate related services. As reported in the Troubled Company Reporter on May 23, 2006, Reed Smith will focus solely on negotiations concerning the Debtors' collective bargaining agreements with the International Brotherhood of Teamsters and the Debtors' related obligations. PTS will pay Reed Smith at these hourly rates: Billing Category Range ---------------- ----------- Partners $340 - $825 Associates and Counsel $235 - $490 Paralegals $120 - $290 Reed Smith professionals that are expected to have primary responsibility for the engagement are: Current Reed Smith Professional Hourly Rate ----------------------- ----------- Paul M. Singer $625 William Bevan III $490 Robert B. Cottington $425 Jeanne S. Lofgren $260 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). James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A. Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq., at Hodgson Russ LLP represent the Debtors in their restructuring efforts. David Neier, Esq., at Winston & Strawn LLP, represents the Official Committee of Unsecured Creditors. 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. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) POSITRON CORP: Secures $2 Million Loan from Private Investors ------------------------------------------------------------- Positron Corporation consummated a financing agreement for $2,000,000 with private investors on May 26, 2006. Pursuant to the terms of the related agreements executed with the investors, the Company received the first of three tranches of the Financing. The Company issued to the investors secured convertible debentures in the aggregate amount of $2,000,000, with interest at the rate of 6% and a maturity date of May 23, 2009. The Debentures are convertible into shares of Positron's Common Stock at the product of the Applicable Percentage and the average of the lowest three trading prices for the common stock during the twenty trading day period prior to conversion. The "Applicable Percentage" is the equivalent of 50%; provided, however, that the Applicable Percentage shall be increased to: -- fifty-five percent in the event that the Company's Statement is filed within thirty days of the closing; and -- sixty-five percent in the event that the Registration Statement becomes effective within one hundred and twenty days from the Closing. Positron has the right to repay principal and interest in cash, if the price of the Company's Common Stock is below $.20 on the last business day of a month. The Registrant simultaneously issued to the Investors warrants to purchase 30,000,000 shares of Common Stock at an exercise price of $.15 per share. The Warrants are exercisable for seven years following the closing. Headquartered in Houston, Texas, Positron Corporation -- http://www.positron.com-- designs, manufactures, markets and supports advanced medical imaging devices utilizing positron emission tomography technology under the trade name POSICAM(TM) systems. POSICAM(TM) systems incorporate patented and proprietary software and technology for the diagnosis and treatment of patients in the areas of cardiology, oncology and neurology. POSICAM(TM) systems are in use at leading medical facilities, including the University of Texas -- Houston Health Science Center; The Heart Center of Niagara in Niagara Falls, New York; Emory Crawford Long Hospital Carlyle Fraser Heart Center in Atlanta; and Nishidai Clinic (Diagnostic Imaging Center) in Tokyo. * * * Going Concern Doubt As reported in the Troubled Company Reporter on May 16, 2006, Ham, Langston & Brezina, L.L.P. expressed substantial doubt about Positron Corporation's ability to continue as a going concern after auditing the Company's financial statements for the year ended Dec. 31. 2005. The auditing firm pointed to the Company's recurring losses from operations and low inventory turnover. PRESIDENT CASINOS: Deloitte & Touche Raises Going Concern Doubt --------------------------------------------------------------- Deloitte & Touche LLP, in St. Louis, Missouri, raised substantial doubt about President Casinos, Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Feb. 28, 2006. The auditor pointed to the Company's recurring losses from operations, negative working capital and stockholders' capital deficiency. The Company also explained that due to their Chapter 11 proceedings, their ability to continue as a going concern is dependent upon: -- their ability to obtain additional financing; -- the actions and decisions of their creditors and other third parties who have interests in their Chapter 11 proceedings that may be inconsistent with the Company's plans; -- their ability to obtain court approval with respect to motions in the Chapter 11 proceedings prosecuted from time to time; -- their ability to develop, prosecute, confirm and consummate a plan of reorganization with respect to the Chapter 11 proceedings; -- their ability to obtain and maintain normal terms with vendors and service providers; -- their ability to maintain contracts; and -- the risks associated with third parties seeking and obtaining court orders to convert the cases to Chapter 7 cases. The Company is also concerned that they may be unable to complete the proposed sale of their St. Louis operations and, if completed, the sale proceeds may not be sufficient to satisfy their debt obligations. As reported in the Troubled Company Reporter on March 3, 2006, Pinnacle Entertainment (NYSE: PNK) entered into an agreement with President Casinos, Inc. to purchase all of the outstanding capital stock of President Riverboat Casino-Missouri, Inc., dba President Casino St. Louis Riverfront, for approximately $31.5 million, subject to working capital adjustments. The stock comprises substantially all of the Company's remaining assets. Final closing of the sale to Pinnacle is contingent upon satisfaction of various closing conditions including licensing and approval of the buyer by the Missouri Gaming Commission. The Company says that there can be no assurance that these closing conditions can be satisfied, or that the transaction will be completed on the terms set forth in the purchase agreement. The Company intends to complete the sale under the agreement with Pinnacle as soon as practicable after the conditions have been fulfilled. If a superior offer is not received, the anticipated sale proceeds from the transaction with Pinnacle may not be sufficient to pay the outstanding debt obligations and other liabilities in full. The proceeds of the sale to Pinnacle will be held for the ultimate benefit of the Company's creditors as provided by order of the Bankruptcy Court. The Company earned $34,341,000 in net income on zero revenue for the year ended Feb. 28, 2006. At Feb. 28, 2006, the Company's balance sheet showed $66,760,000 in total assets and $74,576,000 in total liabilities, resulting in a $7,816,000 stockholders' equity deficit. A full-text copy of the Company's 2006 Annual Report is available for free at http://researcharchives.com/t/s?b10 About Pinnacle Entertainment Headquartered in Las Vegas, Nevada, Pinnacle Entertainment, Inc. -- http://www.pnkinc.com/-- owns and operates casinos in Nevada, Louisiana, Indiana and Argentina, owns a hotel in Missouri, receives lease income from two card club casinos in the Los Angeles metropolitan area, has been licensed to operate a small casino in the Bahamas, and owns a casino site and has significant insurance claims related to a hurricane-damaged casino previously operated in Biloxi, Mississippi. Pinnacle opened a major casino resort in Lake Charles, Louisiana in May 2005 and a new replacement casino in Neuquen, Argentina in July 2005. About President Casinos Inc. Headquartered in St. Louis, Missouri, President Casinos Inc. -- http://www.presidentcasino.com/-- currently owns and operates a dockside gaming casino in St. Louis, Missouri through its wholly owned subsidiary, President Missouri. The Debtor filed for chapter 11 protection on June 20, 2002 (Bankr. S.D. Miss. Case No. 02-53055). On July 11, 2002, substantially all of Debtor's other operating subsidiaries filed for chapter 11 protection in the same Court. The Honorable Judge Edward Gaines ordered the transfer of President Casino's chapter 11 cases from Mississippi to Missouri. The case was reopened on Nov. 5, 2002 (Bankr. E.D. Mo. Case No. 02-53005). Brian Wade Hockett, Esq., at Hockett Thompson Coburn LLP, represents the Debtors in their restructuring efforts. David A. Warfield, Esq., at Blackwell Sanders Peper Martin LLP, represents the Official Committee of Unsecured Creditors. The Company's balance sheet at Nov. 30, 2005 showed assets totaling $66,292,000 and debts totaling $75,531,000. PRUDENTIAL STRUCTURED: Fitch Cuts Rating on $19.7 Million Notes --------------------------------------------------------------- Fitch upgrades two classes, downgrades four classes and affirms one class of notes issued by Prudential Structured Finance CBO I. These rating actions are effective immediately: -- $24,063,830 class A-1L notes upgraded to 'AAA' from 'AA+'; -- $9,625,532 class A-1 notes upgraded to 'AAA' from 'AA+'; -- $20,000,000 class A-2L notes affirmed at 'BB+'; -- $8,000,000 class B-1L notes downgraded to 'C/DR3' from 'CCC/DR3'; -- $4,200,000 class B-1 notes downgraded to 'C/DR3' from 'CCC/DR3'; -- $5,000,000 class B-2L notes downgraded to 'C/DR5' from 'CC/DR5'; -- $2,500,000 class B-2 notes downgraded to 'C/DR5' from 'CC/DR5'. Prudential is a collateralized debt obligation that closed Oct. 26, 2000 and is managed by Prudential Investment Management Company. Prudential exited its reinvestment period on Nov. 15, 2005 and the portfolio is composed of residential mortgage-backed securities (61.3%), CDOs (7%) and asset-backed securities (ABS) (31.7%). Included in this review, Fitch conducted cash flow modeling utilizing various default timing and interest rate scenarios to measure the breakeven default rates going forward relative to the minimum cumulative default rates required for the rated liabilities. The upgrades to the class A-1L and A-1 notes are due to an increase in credit enhancement. Since the reinvestment period ended, principal proceeds have been used to repay principal to the class A-1L and A-1 notes. Also, the Additional Coverage test continues to breach its minimum threshold, diverting excess spread to the two senior tranches. As of the most recent payment on May 15, 2006, approximately $33.7 million of class A-1L and A-1 notes, or 13.8% of the original note balances, remains outstanding with $81.8 million of collateral in the portfolio. The downgrades to the class B notes are due to the continued expectation of low recovery estimates for several distressed securities. The four overcollateralization (OC) tests have improved between the last review in June 2005 and the most recent trustee report from May 2, 2006, however, the OC calculations do not apply haircuts for low rated collateral, and currently 20.5% of the portfolio is rated 'BB-' or below, compared to 17.8% at last review. This bucket includes approximately $22.5 million of distressed collateral, of which $20.2 million are from 12-B1 fee transactions that are expected to have very low recoveries. Taking these projected losses into consideration, Prudential's class B notes do not have the necessary credit enhancement to maintain their current ratings. While current on interest, the class B notes are not expected to recover their full principal balance. The affirmation of the class A-2L notes is due to the offsetting affects of improved credit enhancement and the class's sensitivity to deterioration in the portfolio. While credit enhancement levels have improved significantly, the A-2L notes will not begin to delever until the class A-1L and A-1 notes have paid in full. The ratings of the class A-1L, A-1 and A-2L notes address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the stated balance of principal by the legal final maturity date. The ratings of the class B-1L, B-1, B-2L and B-2 notes address the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the stated balance of principal by the legal final maturity date. Fitch will continue to monitor and review this transaction for future rating adjustments. RALI SERIES: Moody's Puts Ba2 Rating on Class M-10 Certificates --------------------------------------------------------------- Moody's Investors Service assigned an Aaa rating to the senior certificates issued by RALI Series 2006-QA4 Trust, Mortgage Asset- Backed Pass-Through Certificates, Series 2006-QA4, and ratings ranging from Aa1 to Ba2 to the mezzanine certificates in the deal. The securitization is backed by Homecomings Financial Network, Inc., National City Mortgage Company, First National Bank of Nevada, and various other originators originated adjustable-rate Alt-A mortgage loans acquired by Residential Accredit Loans, Inc. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, overcollateralization, excess spread, and a swap agreement. Moody's expects collateral losses to range from 0.90% to 1.10%. Primary servicing will be provided by HomeComings Financial Network, Inc. and GMAC Mortgage Corporation. Residential Funding Corporation will act as master servicer. Moody's assigned HomeComings its top servicer quality rating as primary servicer of prime loans and as primary servicer of subprime loans. Furthermore, Moody's has assigned RFC its top servicer quality rating as master servicer. The complete rating actions: RALI Series 2006-QA4 Trust Mortgage Asset-Backed Pass-Through Certificates, Series 2006-QA4 * Cl. A, Assigned Aaa * Cl. M-1, Assigned Aa1 * Cl. M-2, Assigned Aa2 * Cl. M-3, Assigned Aa3 * Cl. M-4, Assigned A1 * Cl. M-5, Assigned A2 * Cl. M-6, Assigned A3 * Cl. M-7, Assigned Baa1 * Cl. M-8, Assigned Baa2 * Cl. M-9, Assigned Baa3 * Cl. M-10, Assigned Ba2 RASC SERIES: Moody's Puts Low-B Ratings on Two Cert. Classes ------------------------------------------------------------ Moody's Investors Service assigned a Aaa rating to the senior certificates issued by RASC Series 2006-KS4 Trust, Home Equity Mortgage Asset-Backed Pass-Through Certificates, Series 2006-KS4 and ratings ranging from Aa1 to Ba2 to the mezzanine certificates in the deal. The securitization is backed by Homecomings Financial Network, Inc. originated adjustable-rate and fixed-rate subprime mortgage loans. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, overcollateralization, excess spread, and a swap agreement. Moody's expects collateral losses to range from 5.05% to 5.55%. Primary servicing will be provided by Homecomings Financial Network, Inc., and Residential Funding Corporation will act as master servicer. Moody's assigned Homecomings its servicer quality rating as primary servicer of subprime 1st lien loans and RFC its top servicer quality rating as master servicer. The complete rating actions: RASC Series 2006-KS4 Trust Home Equity Mortgage Asset-Backed Pass-Through Certificates, Series 2006-KS4 * Cl. A-1, Assigned Aaa * Cl. A-2, Assigned Aaa * Cl. A-3, Assigned Aaa * Cl. A-4, Assigned Aaa * Cl. M-1, Assigned Aa1 * Cl. M-2, Assigned Aa2 * Cl. M-3, Assigned Aa3 * Cl. M-4, Assigned A1 * Cl. M-5, Assigned A2 * Cl. M-6, Assigned A3 * Cl. M-7, Assigned Baa1 * Cl. M-8, Assigned Baa2 * Cl. M-9, Assigned Baa3 * Cl. M-10, Assigned Ba1 * Cl. B, Assigned Ba2 REVLON INC: Lowers Revenue Guidance for 2006 and Beyond ------------------------------------------------------- Revlon, Inc. updated its outlook for 2006 and beyond and provided guidance on its Vital Radiance and Almay initiatives as well as its capital structure plans. The Company expects strong revenue growth in 2006, although this growth is now expected to be lower than previously planned. The revised revenue outlook, while still strong, reflects less robust growth from Vital Radiance and Almay due to stepped up competitive activity, as well as less effectiveness from certain of the Company's revenue driving actions. The Company indicated that it is continuing to take important and appropriate steps intended to create long-term value and build its brands, including continuing to invest in its brand initiatives, while continuing to take appropriate and aggressive actions to reduce costs. The Company noted that it believes Vital Radiance is a compelling consumer proposition and will work with its retail partners to optimize the new brand's productivity and retail presentation, which could result in the reconfiguration or reduction of the Vital Radiance retail display space in certain retailers. Revlon indicated that, given its revised revenue outlook, it now expects Adjusted EBITDA will be at or below 2005 levels, with a significant impact on the second quarter of this year. Revlon disclosed it intends to defer its $75 million equity offering to later in 2006 or early 2007 and will defer consideration of the previously-announced proposed refinancing of its current credit facility. The Company's existing revolving credit facility and term loan expire in July 2009 and July 2010, respectively. To ensure the Company raises the planned $75 million in equity, MacAndrews & Forbes, Revlon's principal shareholder, has agreed to extend its backstop until the consummation of such offering. In addition, as previously announced, the $87 million MacAndrews & Forbes line of credit will remain available to the Company through the completion of the $75 million equity issuance. MacAndrews & Forbes, Revlon's principal shareholder, stated, "We continue to believe in the long-term value of the Revlon business and its brands and, as a result, we have extended our backstop support." In terms of the Company's longer-term outlook, Revlon indicated that it will continue to invest to support and build its brands, while continuing to focus over the long-term on improving its margin structure through the Company's ongoing productivity initiatives. These include: -- reducing cost of goods sold through, among other things, ongoing value analysis, strategic sourcing and package rationalization activities; -- reducing returns though product lifecycle management and promotional redesign initiatives, among other actions; and -- reducing costs in other areas via strategic sourcing and aggressive management of discretionary spending. The Company indicated that it continues to target a significant improvement in its operating profit margin over time, but that it no longer expects a 12% operating margin by the end of 2008, despite good progress being made in cost of goods and administrative expenses. Commenting on the announcements, Revlon President and CEO Jack Stahl stated, "Our initiatives are delivering significant incremental revenue growth in 2006, although they are requiring significant levels of investment to build consumer awareness and trial--particularly of Vital Radiance--due in part to the heightened competitive environment. We believe that these investments, along with our other actions to build the value of our brands, strengthen our retail relationships and reduce costs, will benefit the value of our Company over time." About Revlon Revlon (NYSE:REV) -- http://www.revloninc.com/-- is a worldwide cosmetics, skin care, fragrance, and personal care products company. The Company's vision is to deliver the promise of beauty through creating and developing the most consumer preferred brands. The Company's brands include Revlon(R), Almay(R), Vital Radiance(R), Ultima(R), Charlie(R), Flex(R), and Mitchum(R). At March 31, 2006, the Company's balance sheet showed $1,085,400,000 in total assets and $2,127,500,000 in total liabilities, resulting in a stockholders' deficiency of $1,042,100,000. RIEFLER CONCRETE: Case Summary & 24 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Riefler Concrete Products, LLC 5690 Camp Road Hamburg, New York 14075 Tel: (716) 649-3260 Fax: (716) 649-3531 Bankruptcy Case No.: 06-01574 Debtor-affiliate filing separate chapter 11 petition: Entity Case No. ------ -------- Riefler Real Estate Corp. 06-01575 Type of Business: Riefler Concrete manufactures and distributes licensed concrete masonry products, and offers concrete construction and filling services. See http://www.riefler.com/ourhistory.asp Chapter 11 Petition Date: June 12, 2006 Court: Western District of New York (Buffalo) Judge: Michael J. Kaplan Debtors' Counsel: Bruce F. Smith, Esq. Jager Smith P.C. One Financial Center Boston, Massachusetts 02111 Tel: (617) 951-0500 Fax: (617) 951-2414 Estimated Assets Estimated Debts ---------------- --------------- Riefler Concrete $10 Million to $10 Million to Products, LLC $50 Million $50 Million Riefler Real $1 Million to $1 Million to Estate Corp. $10 Million $10 Million A. Riefler Concrete Products, LLC's 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ LaFarge Corporation $1,467,903 P.O. Box 13682 Newark, NJ 00718-8682 Concrete Ventures, LLC $730,004 c/o Ross B. Kenzie Cyclorama Building 369 Franklin Street Buffalo, NY 14202 Buffalo Crushed Stone $603,367 2544 Clinton Street P.O. Box 710 Buffalo, NY 14224 St. Lawrence Cement Co., LLC $553,418 P.O. Box 8500-6930 Philadelphia, PA 19178-6930 BVII, LLC $547,497 c/o Michael McQueeney Summer Street Capital Partners 70 West Chippewa Street Buffalo, NY 14202 Gernatt Gravel Products $477,304 Department 124 P.O. Box 8000 Buffalo, NY 14267 Gernatt Asphalt Products $356,710 Department 124 P.O. Box 8000 Buffalo, NY 14267 Unsecured AP Note $453,916 St. Mary's Cement Inc. (USA) $195,860 J & S Transportation $163,656 DeGussa Admixtures, Inc. $150,044 LaFarge North America, Inc. $118,981 GE Transportation Finance $97,603 Trenwyth Industries, inc. $95,544 M & T Insurance Agency, Inc. $89,497 TLW Transport $82,244 Open Flow Gas Supply Corp. $67,653 Headwaters Resources, Inc. $63,172 WR Grace & Co. $55,834 Michael A. Sheehan $50,000 B. Riefler Real Estate Corp.'s 5 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wachovia Capital Finance Corp. All Assets $1,889,089 c/o Will Williams One Post Office Square Boston, MA 02110 G.E. Transportation Finance $97,603 P.O. Box 822108 Philadelphia, PA 19182-2108 G.E. Electric Capital $23,757 P.O. Box 640387 Pittsburgh, PA 15264-0387 G.E. Capital Corp. $3,486 General Electric Capital Corp. $1,547 ROYAL GROUP: Georgia Gulf Takeover Offer Cues S&P to Retain Watch ----------------------------------------------------------------- Standard & Poor's Ratings Services said its 'BB' long-term corporate credit and senior unsecured debt ratings on Woodbridge, Ontario-based Royal Group Technologies Ltd. will remain on CreditWatch with negative implications, where they were placed March 16, 2006. The continued CreditWatch follows Georgia Gulf Corp.'s (BB+/Watch Neg/--) takeover proposal for approximately C$1.7 billion, including C$491 million of assumed net debt. "If Royal Group's shareholders approve the takeover proposal, the ratings on Royal Group will likely be equalized with the ratings on Georgia Gulf," said Standard & Poor's credit analyst Dan Parker. The ratings on Georgia Gulf have been placed on CreditWatch with negative implications however, as the purchase will be financed with additional debt. "The possibility also remains that another bidder will emerge. The ratings on Royal Group will remain on CreditWatch until any bid is finalized," Mr. Parker added. The ratings on Royal Group were placed on CreditWatch in March following the company's announcement that it would need to delay filing its financial statements, concerns about liquidity, deteriorating profitability, and shareholder lawsuits. Royal Group's liquidity has improved since March, as the company continues to realize the proceeds from asset sales, which should total at least C$210 million in 2006, and the company's seasonal working capital swing has now turned positive. High resin prices and the strength of the Canadian currency, however, have negatively affected cash generation as EBITDA was down 36% versus the same quarter in 2005. The deterioration in profitability remains a concern. Royal Group is a leading North American manufacturer of custom vinyl window profiles. Other key products include PVC exterior cladding, sheds, fencing and decks, storage systems, pipes, and other construction systems. The company had annual sales of C$1.7 billion for fiscal 2005. Markets served are mainly building and construction, and housing. SAINT VINCENTS: City of New York Asserts Liens on Queens Hospitals ------------------------------------------------------------------ Michael A. Cardozo, Esq., counsel for the city of New York, tells the U.S. Bankruptcy Court for the Southern District of New York that the City has substantial first liens for, inter alia, unpaid water and sewer charges which must be paid prior to any closing on the sale of Mary Immaculate Hospital and St. John's Queen's Hospital located in Queens, New York. According to Mr. Cardozo, the City is concerned that the Debtors' plan to sell the Hospitals and related assets free and clear of all liens may affect the City's liens with respect to the Hospitals. The city of New York joins in the objection filed by Primary Care Development Corporation to the Debtors' proposed sale. The City reserves its rights to further object to the sale of any of the Hospitals or related assets. As reported in the Troubled Company Reporter on May 31, 2006, the Debtors have entered into an Asset Purchase Agreement with Caritas Health Care Planning, Inc., an affiliate of Wyckoff Heights Medical Center for the sale of the Queens Hospitals and related assets, subject to higher or better offers received through a bidding process and auction. The Debtors and Caritas have entered into an amendment to the Purchase Agreement, dated May 16, 2006. The changes include technical and minor substantive corrections to the Purchase Agreement. A full-text copy of the Amendment to the Queens Hospitals Purchase Agreement is available for free at: http://researcharchives.com/t/s?b51 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. 27 Bankruptcy Creditors' Service, Inc., 215/945-7000) SAMSONITE CORPORATION: Closes Denver Distribution Facilities ------------------------------------------------------------ Samsonite Corporation is closing its Denver, Colorado facilities. The Company's corporate functions in Denver will be consolidated with its offices in Mansfield, Massachusetts and the Company's Denver distribution facilities will be relocated to the Southeast region of the United States. The Company expects that the consolidation and relocation of all functions of the Denver facility will be completed by December 31, 2007. Related to this action, the Company expects to incur and accrue severance and retention costs over the next four to seven fiscal quarters of approximately $3.7 million. In addition, the Company expects that it will incur approximately $3 million of costs for new employee training, employee relocation and recruiting, and expenses of moving inventory and distributions systems. These costs will be expensed as incurred. Samsonite Corporation -- http://www.samsonite.com-- designs, manufactures and distributes luggage, casual bags, business cases and travel related products throughout the world. The Company also licenses its brand names and is involved with the design and sale of apparel. The Company's balance sheet at Jan. 31, 2006, showed $567,251,000 in total assets, $602,407,000 in total liabilities and $16,057,000 of minority interests in consolidated subsidiaries, resulting in total stockholders' deficit of $51,213,000. * * * As reported in the Troubled Company Reporter on May 26, 2006, Standard & Poor's Ratings Services raised its ratings on Samsonite Corp. due to the company's continued improvement in operating performance and its improved financial risk profile. The corporate credit rating was raised to 'BB-' from 'B+'. The rating outlook is stable. SANTIAGO ASSOCIATES: Taps Hirsch Law Office as Bankruptcy Counsel ----------------------------------------------------------------- Santiago Associates, Inc., asks the U.S. Bankruptcy Court for the District of Arizona for permission to employ Hirsch Law Office, P.C., as its bankruptcy counsel. Hirsch will: a. provide the Debtor with advice regarding its responsibilities under the Bankruptcy Code and rules regarding the operation of its business; b. appear before the Court to represent the Debtor; c. negotiate and formulate a plan of reorganization; and d. perform other legal services as necessary in the course of the Debtor's bankruptcy proceedings. The Debtor tells the Court that the firm's attorney's bill $275 per hour while paralegals bill $100 per hour. The Debtor discloses that it will pay the firm a $20,000 retainer. To the best of the Debtor's knowledge, the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Phoenix, Arizona, Santiago Associates, Inc., filed for chapter 11 protection on May 18, 2006 (Bankr. D. Ariz. Case No. 06-01454). Lawrence d. Hirsch, Esq., at Hirsch Law Office, P.C., represents the Debtor. No Official Committee of Unsecured Creditors has been appointed in the Debtor's case. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million and $50 million. SENIOR HOUSING: Reports $15.7 Million Net Income in First Quarter ----------------------------------------------------------------- Senior Housing Properties Trust reported $15.7 million of net income on $41.2 million of revenues for the three months ended March 31, 2006, compared to $13.9 million of net income on $39.2 million of revenues for the same period in 2005. The Company's principal debt obligations at March 31, 2006, were unsecured revolving bank credit facility, two issues totaling $342.5 million of unsecured senior notes, $28.2 million of junior subordinated debentures and $63.5 million of mortgage debt and bonds secured by 21 of the Company's properties. At March 31, 2006, the Company's balance sheet showed $1.5 million in total assets and $568,398 in total liabilities. A full-text copy of the Company's 2006 Quarterly Report is available for free at http://researcharchives.com/t/s?af5 Senior Housing Properties Trust is a real estate investment trust, or REIT, which invests in senior housing properties, including apartment buildings for aged residents, independent living properties, assisted living facilities and nursing homes. As of December 31, 2005, we owned 188 properties located in 32 states with a book value of $1.7 billion before depreciation. * * * Senior Housing Properties Trust's senior unsecured debt gets Fitch's BB+ rating and Moody's Ba3 rating. The outlook for both ratings is stable. SMART HOME: Moody's Rates Class B-1 Certificates at Ba1 ------------------------------------------------------- Moody's Investors Service assigned ratings ranging from Aa2 to Ba1 to the notes issued by SMART HOME Reinsurance 2006-1 Limited and SMART HOME Credit 2006-1 LLC. Smart Home 2006-1 is a synthetic securitization of mortgage insurance risk associated with a reference portfolio of approximately $5.89 billion of subprime and Alt-A mortgage loans. The mortgage insurance is provided by Radian Guaranty Inc. The expected performance of the loans in the reference portfolio, estimated in a range of economic environments, and adjusted for the loss absorption rates of mortgage insurance, drive the ratings. Credit enhancement for the notes is provided primarily through subordination. The bulk of the loans constituting the underlying reference pool were originated by Option One Mortgage Corporation, Freemont Investment & Loan, First Franklin Financial Corporation, and Ameriquest Capital Corporation. Through a reinsurance agreement with the issuers of the notes, Radian pays a fee for the assumption of a portion of the mortgage insurance risk. Investors are exposed to risk from the mortgage insurance and have an interest in the holdings of the issuer, which include highly rated investments, in addition to the fees on the reinsurance agreement. The complete rating actions: Co-Issuer: SMART HOME Reinsurance 2006-1 Limited Co-Issuer: SMART HOME Credit 2006-1 LLC * Class M-2, Assigned Aa2 * Class M-3, Assigned Aa3 * Class M-4, Assigned A1 * Class M-5, Assigned A2 * Class M-6, Assigned A3 * Class M-7, Assigned Baa1 * Class M-8, Assigned Baa1 * Class M-9, Assigned Baa3 * Class B-1, Assigned Ba1 STRUCTURED ASSET: Moody's Puts Low-B Ratings on Two Cert. Classes ----------------------------------------------------------------- Moody's Investors Service assigned a Aaa rating to the senior certificates issued by Structured Asset Investment Loan Trust, Mortgage Pass-Through Certificates, Series 2006-3, and ratings ranging from Aa1 to Ba2 to the subordinate certificates in the deal. The securitization is backed by BNC Mortgage, Inc., Countrywide Home Loans, Inc., Argent Mortgage Company, LLC and various others originated adjustable-rate and fixed-rate subprime mortgage loans acquired by Lehman Brothers Holdings Inc. Approximately 8.7% of the loans are second lien mortgage loans. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, excess spread, overcollateralization, mortgage insurance, an interest rate cap agreement, and an interest rate swap agreement. Moody's expects collateral losses to range from 3.85% to 4.35%. At closing, Option One Mortgage Corporation, Countrywide Home Loans Servicing LP, Wells Fargo Bank, N.A., Select Portfolio Servicing, Inc., Aurora Loan Services LLC and JPMorgan Chase Bank, N.A., will be the servicers. On or about July 1, 2006, Wells Fargo and JP Morgan will take over servicing from Option One. Wells Fargo Bank, N.A. will act as master servicer. The complete rating actions: Structured Asset Investment Loan Trust 2006-3 Mortgage Pass-Through Certificates, Series 2006-3 * Class A1, rated Aaa * Class A2, rated Aaa * Class A3, rated Aaa * Class A4, rated Aaa * Class A5, rated Aaa * Class A6, rated Aaa * Class M1, rated Aa1 * Class M2, rated Aa2 * Class M3, rated Aa3 * Class M4, rated A1 * Class M5, rated A2 * Class M6, rated A3 * Class M7, rated Baa1 * Class M8, rated Baa2 * Class M9, rated Baa3 * Class B1, rated Ba1 * Class B2, rated Ba2 SUNNY DELIGHT: Aggressive Leverage Prompts S&P to Junk Ratings -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and bank loan ratings on Cincinnati, Ohio-based Sunny Delight Beverages Co. to 'CCC' from 'CCC+'. The outlook is negative. Sunny Delight had about $133 million of total debt outstanding at April 30, 2005. "The downgrade reflects performance in 2005 and year to date April 2006 that has been materially below our expectations," said Standard & Poor's credit analyst Alison Sullivan. The company's liquidity also remains limited. As of April 30, 2006, Sunny Delight had fully drawn on its $30 million revolver during its peak seasonal borrowing period. On May 8, 2006, the company received an amendment to relax covenants and permit the sale of preferred stock. Proceeds from the preferred stock were used to reduce revolver borrowings. At March 31, 2006, the company was in compliance with amended financial covenants, although cushion was limited. S&P believes the company will have limited cushion to meet its debt amortization payments in 2006. The ratings on Sunny Delight Beverages Co. reflect its narrow product portfolio, limited size within the highly competitive and somewhat fragmented global juice industry and aggressive leverage. The juice drink company is owned by financial sponsor JW Childs Associates L.P. Sunny Delight is a global manufacturer and distributor of juice drinks and sports beverages under the Sunny Delight brand name. However, the company is a relatively small participant in the growing global juice and sports drink industry. Sunny Delight holds an estimated 26% value share in the roughly $900 million U.S. chilled juice drink market, yet faces larger and financially stronger competitors in the juice, juice drink, and sports drink sectors, including Kraft Foods Inc.'s Capri Sun brand, The Coca- Cola Co.'s Minute Maid brand, and PepsiCo's Gatorade brand, in addition to many smaller participants. There is some customer concentration risk as the largest customer represents about 27% of sales. T.A.T. PROPERTY: Plan Proposes to Pay Unsec. Creditors in Full -------------------------------------------------------------- T.A.T. Property plans to pay general unsecured creditors 100% of their claims out of net positive cash flow in bi-monthly installments for the two months preceding each installment. The Debtor disclosed this treatment in its Plan of Reorganization filed with the U.S. Bankruptcy Court for the Southern District of New York. The Plan will be funded from: -- new funding, -- current and future rents from the Debtor's property in 45 Executive Drive, Plainview, New York. -- any monies remaining in the accounts of the receiver appointed by the Nassau County Supreme Court in the foreclosure action commenced by LaSalle Bank National Association after costs and expenses of the Receivership are paid; and -- monies from collection of Debtor's existing accounts receivable. T.A.T. Property is looking for an investor to fund the plan. It will convey a 60% interest in its property in the Plainview property in exchange for the funding. The Debtor will reinstate the maturity of the LaSalle's mortgage on the Plainview property and will pay amounts as may be necessary to cure all defaults under the LaSalle Mortgage. Michael Zenobio, Jr., the principal beneficiary and grantor with respect to the Debtor, will receive 100% of his allowed claim after payment in full of all general unsecured claims. Equity holders will retain their interest. A full-text copy of the Plan is available for a fee at: http://www.researcharchives.com/bin/download?id=060612043931 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. TANK SPORTS: Kabani & Company Raises Going Concern Doubt -------------------------------------------------------- Kabani & Company, Inc., in Los Angeles, California, raised substantial doubt about Tank Sports, Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Feb. 28, 2006. The auditor pointed to the Company's net loss and accumulated deficits during the fiscal year. The Company says that the recoverability of a major portion of the recorded asset amounts is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to raise additional capital, to increase more sales and to succeed in its future operations. The Company reported a $206,713 net loss on $7,539,336 of total revenues for the year ended Feb. 28, 2006. At Feb. 28, 2006, the Company's balance sheet showed $2,249,690 in total assets and $2,908,656 in total liabilities, resulting in a $658,966 stockholders' equity deficit. A full-text copy of the Company's 2006 Annual Report is available for free at http://researcharchives.com/t/s?b0e Based in El Monte, California, Tank Sports, Inc. -- http://www.tank-sports.com/us/-- markets, sells and distributes recreational and transportation motorcycles, all-terrain vehicles, dirt bikes, scooters and Go Karts in the United States and international markets. Tank Sports complements each of their product lines with an assortment of replacement parts and accessories, which are available at their dealerships. Since 2003, the Company has switched their focus from the production of bicycles to the sales and distribution of motorcycles and ATVs. TEEKAY SHIPPING: Moody's Holds Corporate Family Rating at Ba1 ------------------------------------------------------------- Moody's Investors Service lowered the Speculative Grade Liquidity rating of Teekay Shipping Corporation to SGL-2 from SGL-1. Moody's also affirmed all other ratings -- corporate family rating at Ba1. In addition, Teekay's plan to create a second Master Limited Partnership does not affect the ratings at this time. The outlook is stable. The change from SGL-1 is prompted by the expectation of significantly negative free cash flow over the next twelve months due to declining spot market rates for tankers. Lower spot rates will reduce cash flow from operations during a period of stepped- up capital expenditures for new building programs for the company. In addition, Moody's believes that Teekay will also continue to return cash to shareholders via share repurchases or by increasing dividends. Notwithstanding the effects on operating cash flows of a softening spot tanker market, Moody's expects that Teekay will maintain a good liquidity profile over the next 12 months. Moody's anticipates Teekay will hold unrestricted cash above $200 million along with at least $550 million available under $1.7 billion of senior secured revolving bank credit facilities, with significant cushion under financial covenants. However, Moody's estimates that cash flow from operations will decline over the next 12 months by approximately 40% below cash flow from operations over the last twelve months. Free cash flow is likely to be negative of approximately $250 million due to the decline in cash flow from operations, and the contemporaneous increase in capital expenditures to approximately $500 million along with regular dividends of approximately $80 million. Moody's expects Teekay will fund capital expenditures with either secured term loan facilities pre-arranged for particular new buildings or with the existing revolvers until requisite secured term loans are arranged. However, Teekay also has somewhat limited alternatives to raise cash in the event the company lost access to the revolvers since a substantial amount of its vessels are already pledged to secure credit agreements. As well, the company is likely to continue to return cash to shareholders as evidenced by the nearly $750 million worth of shares repurchased over the last one and a half years and the additional authorization announced today. Teekay announced on June 12, 2006 that it plans to create a second master limited partnership called Teekay Offshore Partners L.P. which will house its existing shuttle tanker and floating storage & offtake businesses. While Moody's considers the use of MLP's in the equity capital structure as an aggressive financial policy, the effect of placing the Fixed Rate Businesses into an MLP does not affect the ratings at this time. Moody's believes that, similar to the ownership of Teekay LNG Partners, Teekay will retain a significant majority ownership of Teekay Offshore Partners L.P. The existing level of dividends paid by Teekay LNG Partners to third party holders does not overly burden Teekay's free cash flow, and the incremental dividend for Teekay Offshore Partners L.P. should be no more burdensome. Teekay Shipping Corporation, a publicly owned company headquartered in Nassau, Bahamas, having its main operating office in Vancouver, Canada, is the world's largest operator of medium- size and shuttle oil tankers. Teekay operates a fleet of 119 owned or chartered-in crude, refined products and LNG vessels, excluding 21 new buildings on order. TENASKA ALABAMA: Moody's Ups Rating on Senior Secured Bonds to Ba2 ------------------------------------------------------------------ Moody's Investors Service upgraded the rating of Tenaska Alabama Partners, L.P.'s senior secured bonds due 2021 to Ba2 from B1, concluding the review for upgrade that was initiated April 5, 2006. TAP is an 845 MW natural gas and oil-fired project combined cycle power project in Autauga County, Alabama. The rating outlook is stable. The rating action for TAP is prompted by the recent upgrade of The Williams Companies, Inc. long-term senior unsecured debt ratings to Ba2 from B1, reflecting improvements in Williams' core natural gas businesses. Williams guarantees the payments of its subsidiary, Williams Power Company, Inc. under a long-term fuel conversion service agreement between Williams Power and TAP. The FCSA is the source of essentially all of TAP's cash flow. It is Moody's opinion that based on current market prices for natural gas and power, the project would likely not be able to generate sufficient cash to cover operating costs and debt service without the Williams Power contract. The project has been performing in accordance with expectations with availability factors close to 100%. The debt service coverage ratio for calendar year 2006 is projected to be nearly 1.30 times. This projected financial performance is consistent with other fully contracted gas-fired projects rated in the Ba range. The rating outlook is stable reflecting Moody's belief that TAP's consistent operating and financial performance will continue as a result of the experience of its operator, its long term service agreement with its equipment supplier, and the expected stability of its highly contracted projected cash flows. Tenaska Alabama Partners, L.P. is an 845 MW gas and oil-fired power project located in central Alabama. US AIRWAYS: Good Performance Prompts S&P's Stable Outlook --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' corporate credit and other ratings on US Airways Group Inc., and revised the outlook to stable from negative. "The outlook revision reflects the company's better-than-expected financial performance since its merger with America West Holdings Corp. in September 2005," said Standard & Poor's credit analyst Betsy Snyder. "The company's strong revenues have offset continuing high fuel prices, trends expected to continue for the remainder of 2006, resulting in improved profits and cash flow." The ratings on US Airways Group Inc. reflect the inherent high risk profile of the U.S. airline industry, a still substantial debt burden, and limited financial flexibility. Ratings also incorporate the company's relatively low cost structure, and significantly improved liquidity. On Sept. 27, 2005, America West Holdings Corp., parent of America West Airlines Inc., completed a reverse merger of US Airways Group Inc., parent of US Airways Inc., the same day US Airways emerged from Chapter 11 bankruptcy protection. As a result, both America West Holdings and America West Airlines are subsidiaries of US Airways Group. US Airways' unrestricted cash position ($1.6 billion at March 31, 2006) benefited from $867 million of equity invested by six new investors and proceeds from public equity and rights offerings, as well as $830 million of cash from loans provided by business partners. However, the company still has a substantial debt and operating lease burden, with debt to capital of around 95% at March 31, 2006. The airline industry continues to face high fuel costs, but revenue performance has improved significantly, due to strong demand and a series of fare increases. US Airways Group's two airlines will be continue to be operated separately over the next two years or so, primarily to allow for the resolution of labor issues. In the meantime, the company should benefit from expected synergies from combining certain of its overhead and back office functions, which will reduce operating costs. However, the company will still be negatively affected by high fuel prices and potential problems integrating its labor forces. US Airways has made progress in improving its financial profile, primarily through strong revenue growth, a trend expected to continue over the near to intermediate term. If the company were to encounter difficulties integrating its labor forces, resulting in operational disruptions or added costs, the outlook could be revised to negative. If the company was to make significant progress in integrating its labor forces or its financial profile continues to improve, the outlook could be revised to positive. US ONCOLOGY: Moody's Rates Proposed $100 Mil. Term Loan at Ba3 -------------------------------------------------------------- Moody's Investors Service changed the ratings outlook to stable from negative and assigned a Ba3 rating to US Oncology Inc.'s proposed $100 million add-on term loan. Concurrently, Moody's raised the rating of the company's existing senior secured credit facility and senior unsecured notes. These actions are in recognition of the improved stability of the company's operations and substantial enterprise value. The ratings acknowledge that US Oncology appears to have absorbed changes in the reimbursement of pharmaceuticals as well as the start-up of the company's in-house distribution network with little disruption to operations or deterioration in credit metrics. Improved revenue diversification and measured expansion of its distribution business to include specialty pharmacy and mail order capability are also favorably incorporated in the ratings. However, the ratings reflect ongoing concern that pressure will remain on Medicare reimbursement of physician services and managed care pricing. Despite credit metrics that are weak for the B1 rating category, Moody's affirmed the B1 Corporate Family Rating. The affirmation acknowledges that the company is in an expansion period and sizable reinvestment needs are pressuring near term cash flow. However, Moody's expects the company to continue its measured approach to expansion and acquisition activity. The stable ratings outlook reflects an expectation of near-term reimbursement stability and more normalized investments in working capital going forward. The ratings outlook also incorporates Moody's belief that US Oncology will take a more conservative approach to leverage in the future following the $250 million debt-financed dividend completed in 2005. The Ba3 rating on the US Oncology's senior secured credit facilities reflect the stabilization and improvement of enterprise value following the changes in the business during the last year. The B1 rating on the senior unsecured notes reflects our assessment of the overall creditworthiness of the company. As previously noted, the credit metrics of US Oncology are weak for the current rating category due to the significant amount of financial leverage. Moody's may consider changing the outlook or downgrading the ratings if strains on cash flow, which could potentially arise from greater than expected capital spending, changes in reimbursement or other business risks, results in adjusted free cash flow to adjusted debt ratios that are expected to remain at breakeven. Moody's summary of actions: Ratings assigned: US Oncology, Inc.: * $100 term loan add-on, Ba3 Ratings upgraded: US Oncology, Inc.: * $160 million senior secured revolving credit facility, to Ba3 from B1 * $400 million senior secured term loan, to Ba3 from B1 * $300 million senior unsecured notes, to B1 from B2 Ratings affirmed: US Oncology, Inc.: * $275 million senior subordinated notes, B3 US Oncology Holdings, Inc.: * $250 million senior unsecured notes, Caa1 * Corporate Family Rating, B1 * The rating outlook is changed to stable from negative US Oncology headquartered in Houston, Texas, provides comprehensive cancer-care services through a network of affiliated practices. At March 31, 2006, the network comprised more than 1,000 affiliated physicians in over 500 sites, including 84 integrated cancer centers in 33 states. US Oncology is a wholly owned subsidiary of Holdings, a holding company. US ONCOLOGY: S&P Rates $100 Million Senior Secured Term Loan at B ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its loan and recovery ratings to Houston, Texas-based cancer care company US Oncology Inc.'s $100 million secured term loan C. The loan rating is 'B+' (at the same level as the corporate credit rating on US Oncology) with a recovery rating of '2', indicating the expectation for substantial recovery of principal (80%-100%) in the event of a payment default. Existing ratings on the company, including the 'B+' corporate credit rating, were affirmed. The rating outlook is negative. The corporate credit rating on US Oncology reflects the company's narrow operating focus on the treatment of a single disease, its vulnerability to adverse changes in third-party reimbursement policies, and its significant debt. These factors are partially mitigated by rising long-term demand trends, the company's broad geographic presence, and its proven ability to manage growth. US Oncology offers medical oncology services, cancer center services, and cancer research services to a 33-state network of affiliate oncology practices that consist of approximately 1,000 affiliated physicians working in 487 sites, including 80 integrated cancer centers and 13 radiation-only facilities. US Oncology's aggressive capital structure, with lease-adjusted debt to EBITDA at 4.7x for the 12 months ended March 31, 2006, provides little cushion against operating risks. Profitability and cash flow protection measures are expected to be in line with the rating category, with EBITDA margins and return on capital expected to average around 10%. VERIDICOM INT'L: Accumulated Deficit Tops $21.3 Mil. at March 31 ---------------------------------------------------------------- Veridicom International, Inc., filed its financial statements for the first quarter ended Mar. 31, 2006, with the Securities and Exchange Commission. For the three months ended Mar. 31, 2006, the Company reported a $1.2 million net loss on $299,152 of revenues, compared to a $1.3 million net loss on $80,756 of revenues for the same period in 2005. At March 31, 2006, the Company's balance sheet showed $4.5 million in total assets and $4.2 million in total liabilities. As of March 31, 2006, the company had an accumulated deficit of $21.3 million. Going Concern Doubt Manning Elliot LLP, in Vancouver, Canada, raised substantial doubt about Veridicom International's ability to continue as a going concern after auditing the company's amended financial statements for the year ended Dec. 31, 2005. The Firm pointed to the company's recurring losses from operations and working capital deficiency. A full-text copy of the Company's 2006 Quarterly Report is available for free at http://researcharchives.com/t/s?aea Veridicom International, Inc. -- http://www.veridicom.com/-- designs, develops and manufactures computer-based simulation systems for training and decision support. These systems included both hardware and software and are used to train personnel in the use of various military and commercial equipment. Much of the Company's simulator business was in the foreign defense industry. The tightening of defense budgets worldwide, combined with the continuing consolidation and competition in the defense industry, negatively impacted the growth and profit opportunities for the Company. As a result, in July 2000, the Company refocused its business. In connection with the refocus, the Company sold its assets related to its computer based simulation system line of business to a developer and manufacturer of specialized defense simulation products. The Company then commenced development of commercial products in the area of Internet collaboration. VILLAGEEDOCS INC: Posts $273,389 Net Loss in First Quarter 2006 --------------------------------------------------------------- VillageEDOCS, Inc. filed its first quarter financial statements for the three months ended March 31, 2006, with the Securities and Exchange Commission on May 22, 2006. The Company reported a $273,389 net loss on $2,067,839 of revenues for the three months ended March 31, 2006. At March 31, 2006, the Company's balance sheet showed $8,242,838 in total assets, $2,757,147 in total liabilities, and $5,485,691 in stockholders' equity. The Company's March 31 balance sheet also showed strained liquidity with $1,618,580 in total current assets available to pay $2,619,353 in total current liabilities coming due within the next 12 months. A full-text copy of the Company's 1st quarter financial statements for the three months ended March 31, 2006, are available for free at http://researcharchives.com/t/s?b12 Going Concern Doubt Corbin & Company, LLP, in Irvine, California, raised substantial doubt about VillageEDOCS' ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Dec. 31, 2005. The auditor pointed to the Company's recurring losses since inception and its working capital deficit of $676,198. VillageEDOCS, Inc. -- http://www.villageedocs.com/-- through its MessageVision subsidiary, provides comprehensive business-to- business information delivery services and products for organizations with mission-critical needs, including major corporations, government agencies and non-profit organizations. The Company's Tailored Business Systems subsidiary provides accounting and billing solutions for county and local governments. Through its Resolutions subsidiary, it provides products for document management, archiving, document imaging, imaging software, document scanning, e-mail archiving, document imaging software, electronic forms, and document archiving. VINOD CHAND: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Vinod Chand Bansal, Inc. dba Aarti Petroleum dba City Gas 510 East Santa Clara Street San Jose, California 95112 Bankruptcy Case No.: 06-51034 Debtor-affiliate filing separate chapter 11 petition: Entity Case No. ------ -------- KPA, Inc. 06-51033 Type of Business: The Debtor operates a gasoline and oil station. Chapter 11 Petition Date: June 13, 2006 Court: Northern District of California (San Jose) Judge: Marilyn Morgan Debtors' Counsel: Charles B. Greene, Esq. 84 West Santa Clara Street, Suite #770 San Jose, California 95113 Tel: (408) 279-3518 Fax: (408) 279-4264 Debtors' Consolidated Assets and Liabilities: Total Assets: $4,700,000 Total Debts: $2,374,450 The Debtors did not file the list of their 20 largest unsecured creditors. WELLSFORD REAL: Incurs $2.8 Net Loss in Quarter Ending March 31 --------------------------------------------------------------- Wellsford Real Properties, Inc., reported a $2.8 million net loss on $4.3 million of revenues for the three months ended March 31, 2006. The Company's financial statements reflect net assets in liquidation of approximately $53.4 million on March 31, 2006, and approximately $56.6 million on Dec. 31, 2005, based upon 6,471,179 common shares outstanding at each date. At March 31, 2006, the Company's balance sheet showed $113.6 million in total assets and $58.8 in total liabilities. A full-text copy of the Company's 2006 Quarterly Report is available for free at http://researcharchives.com/t/s?af6 Headquartered in New York, New York, Wellsford Real Properties, Inc., was a real estate merchant banking that acquired, developed, financed and operated real properties, constructed for-sale single family home and condominium developments and organized and invested in private and public real estate companies. The Company is in liquidation. At Dec. 31, 2005, the Company's remaining primary operating activities are the development, construction and sale of three residential projects. WESCO INT'L: Moody's Affirms Low-B Ratings on Corp. Family & Bonds ------------------------------------------------------------------ Moody's Investors Service affirmed the ratings of WESCO International Inc. and its subsidiary WESCO Distribution, Inc. Moody's also changed WESCO's outlook to positive from stable based on its improved operating performance and declining debt, and Moody's expectation that performance will continue to improve over the near to intermediate term. Specifically, Moody's affirmed the B2 ratings on both WESCO's guaranteed senior convertible debentures due 2025 and WESCO Distribution, Inc.'s guaranteed senior subordinated notes due 2017, and WESCO's Ba3 corporate family rating. Key factors impacting WESCO's ratings and outlook include: 1) improving operating performance resulting in credit metrics beginning to exceed the company's Ba3 corporate family rating, 2) high financial leverage after securitization and lease adjustments, 3) integration risk related to WESCO's 2005 acquisitions and further acquisition potential given the fragmented nature of the industry with four national distributors in the electric distribution sector accounting for approximately 18% of industry sales, 4) strong geographic reach, product breadth, and customer base with 370 branches and five distribution centers primarily located in North America, 5) and adequate liquidity. The change in outlook to positive from stable reflects Moody's expectation that operating performance should continue to improve and excess free cash flow will be applied to further debt reduction. Previously, Moody's expected adjusted leverage at the end of 2006 to moderate towards 4.0 times, with adjusted coverage exceeding 3.5 times, and retained cash flow to total adjusted debt to reach at least 10% to 15%. Due to WESCO's current operating environment and expected debt reduction efforts, Moody's now believes adjusted leverage should moderate towards 3.0x, with adjusted coverage exceeding 5.0x, and retained cash flow to total adjusted debt to reach approximately 20% at the end of 2006. If WESCO meets these targets and is successful in further reducing debt from current levels on a sustainable basis while maintaining its current cost position, an upgrade would be warranted. Factors that would negatively impact the ratings and/or outlook would be an inability to improve credit statistics within a reasonable time period or deterioration in liquidity, due in part to competitive pressures, additional acquisitions, or the loss of a significant customer. The most recent prior rating action for WESCO occurred on September 20, 2005. Moody's assigned a B2 rating to both WESCO's proposed guaranteed senior convertible debentures due 2025 and WESCO Distribution, Inc.'s proposed guaranteed senior subordinated notes due 2017. Moody's also assigned a Ba3 corporate family rating to WESCO and withdrew the Ba3 corporate family rating of WESCO Distribution, Inc. Proceeds from the offerings were used to partly finance the acquisition of the Carlton-Bates Company by WESCO Distribution, Inc. and refinance existing debt. WESCO International, Inc., headquartered in Pittsburgh, PA, is a leading North American provider of electrical construction products and electrical and industrial maintenance, repair and operating supplies. WERNER LADDERS: Files For Chapter 11 Reorganization in Delaware --------------------------------------------------------------- Werner Co. and several affiliated companies filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code on June 12, 2006. Werner has taken this action to implement a financial restructuring that will provide the financial flexibility and support to complete the operational restructuring already underway. Werner's strategy is to become the low-cost producer of ladders and other climbing products and leverage the Werner brand to drive future growth. Werner expects to continue to operate in the normal course of business during the Chapter 11 reorganization process. All of the Company's manufacturing and distribution facilities are open and continuing to serve customers in the normal course. To help fund its operations during the reorganization process, Werner has secured a commitment for $99 million in debtor-in- possession financing from Black Diamond Commercial Finance. Subject to court approval, these funds will be available to satisfy obligations associated with conducting the company's business, including payment to suppliers under normal terms for goods and services provided after the Chapter 11 filing and payment of wages and benefits to employees and independent sales representatives. "The strategic repositioning of Werner is well underway. In the past few years, we have moved significant production to Mexico and China in an effort to become the low-cost provider of climbing products," Steven P. Richman, Werner's President and Chief Executive Officer, said. "We have revitalized our product development team, resulting in the planned rollout of 15 new products and brand extensions over the next year. The Werner brand is stronger than ever and it is clearly the number one choice for the professional end user." "In recent years, however, Werner has been constrained by its highly leveraged capital structure and by the continuing unprecedented high prices for aluminum and other raw materials. Quite simply, we have too much debt," Mr. Richman continued. "We intend to use the Chapter 11 process to reduce this debt significantly and develop and implement a new capital structure that will allow us to invest in the business." "Fortunately, the fundamentals of our business remain strong and provide an excellent foundation for the future," Mr. Richman concluded. "We expect that Werner will emerge from its Chapter 11 reorganization a stronger, more financially stable company, well- positioned for profitable growth." Werner expects its operations to function normally during the Chapter 11 process, with little impact on how it conducts business: * Customers will be served in the normal course. Werner's manufacturing and distribution facilities are open on normal schedules, and the company expects to continue to fulfill customer orders and provide uninterrupted customer service. * Suppliers will be paid. Werner plans to continue paying suppliers for all goods and services they provide after the filing. * Employees will continue to be paid. Werner plans to provide all wages and benefits for active employees as usual and without interruption. Likewise, the company plans to provide its independent sales representatives with their usual commissions on a timely basis. The Chapter 11 filings by Werner and its affiliates were made in the U.S. Bankruptcy Court for the District of Delaware. Werner's principal legal advisors for the Chapter 11 proceedings are Willkie Farr & Gallagher LLP and Young Conaway Stargatt & Taylor LLP. The Company's financial advisors are Rothschild Inc. with Loughlin Meghji + Co. assisting Werner with its operational restructuring. About Werner Headquartered in Greenville, Pennsylvania, Werner Co. -- http://www.wernerladder.com/-- is the world's leading manufacturer and distributor of ladders, climbing equipment and ladder accessories. Backed by over 50 years of product innovation, Werner leads the industry with its commitment to the design and manufacture of quality products that meet or exceed applicable Occupational Safety and Health Administration and American National Standards Institute codes and standards for strength and structural integrity. WERNER LADDERS: Judge Carey Approves All First Day Motions ---------------------------------------------------------- Werner Co. reported that Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware approved all of the "first-day motions" that Werner and several of its affiliated companies submitted as part of their filings for reorganization under Chapter 11 of the U.S. Bankruptcy Code. Approval of these motions will help Werner continue to operate in the normal course of business during the reorganization process. The Judge's orders include approval of Werner's request to continue payment of wages and benefits to employees and independent sales representatives, to fulfill customer orders and provide uninterrupted customer service, and to take other actions necessary to operate the Company with minimal disruption. Werner also received interim approval to access the $99 million debtor-in-possession financing provided by Black Diamond Commercial Finance. This financing will provide Werner with additional liquidity and will be available to help satisfy obligations associated with conducting the Company's business, including payments to suppliers under normal terms for goods and services provided after the Chapter 11 filing. Werner will seek final authorization to utilize the DIP financing at a later court hearing. "Judge Carey's approval of our first-day motions will ensure that Werner maintains normal operations throughout the reorganization process," Steven P. Richman, Werner's President and Chief Executive Officer, said. "There will be payment of employee wages and benefits without interruption, timely fulfillment of customer orders and efficient customer service, and payment to suppliers for goods and services provided after the filing. We look forward to using the Chapter 11 process to reduce our debt, and our annual interest payments on the debt, so that we have the financial flexibility necessary to invest in Werner's future." About Werner Headquartered in Greenville, Pennsylvania, Werner Co. -- http://www.wernerladder.com/-- is the world's leading manufacturer and distributor of ladders, climbing equipment and ladder accessories. Backed by over 50 years of product innovation, Werner leads the industry with its commitment to the design and manufacture of quality products that meet or exceed applicable Occupational Safety and Health Administration and American National Standards Institute codes and standards for strength and structural integrity. WERNER LADDERS: Case Summary & 30 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Werner Holding Co. (DE), Inc. aka Ad Valorem Properties, Inc. aka ARDEE Investment Co., Inc. aka Wentworth Institutional Realty, Inc. aka Manufacturers Indemnity & Insurance Company of America aka Werner Financial Inc. aka Olympus Properties, Inc. aka Werner Ladder Company aka Florida Ladder Company aka Gold Medal Ladder Company 1105 North Market Street, Suite 1300 Wilmington, Delaware 19801 Bankruptcy Case No.: 06-10578 Debtor-affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- Werner Holding Co. (PA), Inc. 06-10579 Werner Co. 06-10580 WIP Technologies, Inc. 06-10581 Type of Business: The Debtors manufacture and sell climbing products and aluminum extruded products, fiberglass and wood ladders, scaffolding, stages and planks. In addition to climbing products, Werner manufactures and sells aluminum extruded products and more complex fabricated components to a number of industries, including the automotive, electronics, and architectural and construction industries. See http://www.wernerladder.com/ Chapter 11 Petition Date: June 12, 2006 Court: District of Delaware (Delaware) Judge: Kevin J. Carey Debtors' Counsel: Kara Hammond Coyle, Esq. Matthew Barry Lunn, Esq. Robert S. Brady, Esq. Young, Conaway, Stargatt & Taylor, LLP The Brandywine Building, 17th Floor 1000 West Street, P.O. Box 391 Wilmington, Delaware 19899 Tel: (302) 571-6600 Fax: (302) 571-1253 Debtors' Co-Counsel: Willkie Farr & Gallagher LLP 787 Seventh Avenue New York, New York 10019-6099 Tel: (212) 728-8000 Fax: (212) 728-8111 http://www.willkie.com/ Debtors' Claims Agent: Kurtzman Carson Consultants LLC 1180 Avenue of the Americas Suite 1140 New York, New York 10036 Tel: (866) 381-9100 Fax: (310) 823-9133 http://www.kccllc.com/ Debtors' Financial Advisor and Investment Banker: Rothschild Inc. 1251 Avenue of the Americas, 44th Floor New York, New York 10020 http://www.us.rothschild.com/ Debtors' Restructuring Consultants: Loughlin Meghji & Company 48 Madison Avenue, Suite 800 New York, New York 10016 Tel: (212) 340-8420 Fax: (212) 725-9322 http://www.lmco-ny.com/ Debtors' Consolidated Total Assets and Liabilities as of March 31, 2006: Total Assets: $201,042,000 Total Debts: $473,447,000 Debtors' Consolidated List of their 30 Largest Unsecured Creditors: Claim Amount as of Entity Nature of Claim May 31, 2006 ------ --------------- ------------ The Bank of New York Note Debt $142,782,780 (Trustee for the Notes) 101 Barclay Street - 8W New York, NY 10286 Attn: Mary Lagumina Tel: (212) 815-4812 Fax: (212) 815-7760 Werner Enterprises, Inc. Shipping $1,696,621 14507 Frontier Road Omaha, NE 68138 Attn: John Steele Tel: (402) 894-3036 Fax: (402) 894-3990 WXP, Inc. - PS3 and Log Sales Trade Debt $1,242,307 93 Werner Road, Building A Greenville, PA 16125 Attn: John Thigpen Tel: (724) 588-2000 Fax: (724) 589-4286 Grupo American Industries Trade Debt $1,072,702 Washington 3701 ED 18 Chihuahua Chih CP 31200 Mexico Attn: Miriam Vazques Tel: (915) 309-4126 Fax: +011-52-656-629-2601 Saint-Gobain Vetrotex Trade Debt $821,362 America, Inc. 4515 Allendale Road Wichita Falls, TX 76310 Attn: Rick Fortune Tel: (440) 964-8820 Fax: (440) 964-5390 Owens Corning Fiberglass Trade Debt $593,921 One Owens Corning Parkway Toledo, OH 43659 Attn: Joe Arcadi Tel: (440) 286-5777 Fax: (800) 237-7755 Comor, Inc. Trade Debt $571,712 2164 Libre Comercio, Juarez Chihuahua, Mexico Attn: Bob Deets Tel: 011-52-656-171-9629 Fax: 011-52-656-171-9629 Venture Plastics, Inc. Trade Debt $566,946 P.O. Box 249 4000 Warren Road Newton Falls, OH 44444 Attn: Bryon Osborne Tel: (330) 872-5774 Fax: (330) 872-3597 Scanwell Logistics (LAX), Inc. Shipping $550,000 615 North Nash Street, Suite 202 El Segunod, CA 90245 Attn: Gino Lin Tel: (310) 640-8800 Fax: (310) 640-8808 AOC Trade Debt $525,148 2552 Industrial Drive Valparaiso, IN 46383 Attn: Clark Wade Tel: (614) 901-0798 Fax: (219) 465-4427 Century Industries, Inc. Trade Debt $467,252 2300 East 145th Street Little Rock, AR 72206 Attn: Scott Treadway Tel: (501) 897-5253 Fax: (501) 897-5320 EPI Printers, Inc. Trade Debt $281,717 P.O. Box 1025 5350 Dickman Road Battle Creek, MI 49016-1025 Attn: Ron Bosworth Tel: (724) 588-2000 ext. 2355 Fax: (269) 968-4260 Anixter Fasteners Trade Debt $277,942 1435 Henry Brennan Drive, Suite H El Paso, TX 79936 Attn: Tom Knottek Tel: (915) 860-6620 Fax: (915) 860-4898 Hollinee Glass Fibers Trade Debt $262,862 9702 Iron Point Road Shawnee, OH 43782 Attn: David Schumaker Tel: (740) 394-2491 Fax: (740) 394-2496 Bayloff Die & Machine Trade Debt $226,181 5910 Bellville Road Van Buren Twp, MI 48111 Attn: Richard Bayer Tel: (734) 397-9116 Fax: (734) 397-9125 Coinco, Inc. Trade Debt $213,648 P.O. Box 248 23727 U.S. Highway 322 Cochranton, PA 16314 Attn: Jim Cockley Tel: (814) 425-7407 Fax: (814) 425-7489 Suzhou Ronglida Tool Co. Ltd. Trade Debt $190,918 15#, Dongxin Road, Xukou Town Wuzhong District, Suzhou City Jiangsu Province, China Attn: Xiayan Xie/Jianyuan Zhang Tel: +86-512-6621-1567 Fax: +86-512-6621-4046 El Paso Tool & Die Trade Debt $160,784 10859 Pellicano Drive El Paso, TX 79935 Attn: Sal Robles Tel: (915) 591-0346 Fax: (915) 591-0390 Hua Feng Lock Products Ltd. Trade Debt $153,359 South yongNing Industrial Road XiaoLan, ZhongShan GuangDong, China 528415 Attn: Iris Lee/WenLie Ho Tel: +86-760-226-5895 ext. 858 Fax: +86-760-227-8063 Viking Tool & Gage, Inc. Trade Debt $151,608 11160 State Highway 18 Conneaut Lake, PA 16316 Attn: Brian Burns Tel: (814) 382-8691 Fax: (814) 382-5234 Goshen Stamping Co., Inc. Trade Debt $147,980 1025 South 10th Street Goshen, IN 46526-4401 Attn: Jerry Trolz Tel: (574) 533-4108 Fax: (574) 534-4189 St. Paul Travelers Insurance $145,720 Commercial Lines - National 300 Windsor Street Hartford, CT 06120 Attn: Peter A. Heard Tel: (860) 277-7827 Fax: (860) 277-2876 Yellow Freight Shipping $141,938 P.O. Box 13850 Newark, NJ 07188 Attn: Gerry Marra Tel: (412) 781-0578 Fax: (412) 781-9152 Brandywine Distribution Services Shipping $131,768 1330 East 12th Street Wilmington, DE 19802 Attn: Dane Waters Tel: (302) 652-7425 Fax: (302) 652-7426 Custom-Pak, Inc. Trade Debt $106,900 86-16th Avenue North Clinton, IA 52732 Attn: Clay Bahnsen Tel: (563) 242-1801 Fax: (563) 244-5325 Integrated Logistics Solutions Trade Debt $106,544 400 Commerce Boulevard Lawrence, PA 15055 Attn: Mickey Remich Tel: (724) 745-7900 Fax: (724) 745-7572 Paschall Truck Lines (PASC) Shipping $104,376 P.O. Box 1889 3443 Highway 641 South Murray, KY 42071 Attn: Allen Crowely Tel: (800) 626-3374 Fax: (270) 753-1904 Alcan Ingot & Recycling Trade Debt $102,019 6060 Parkland Boulevard Cleveland, OH 44124 Attn: Nancy Pudelsky Tel: (908) 369-2182 Fax: (440) 423-6668 United Parcel Service Shipping $92,383 P.O. Box 99985 Pittsburgh, PA 15233 Attn: Doug Fleming Tel: (814) 833-3670 Fax: (814) 835-2303 Southwest Tape & Label, Inc. Trade Debt $88,817 965 Loma Verde Drive El Paso, TX 79936 Attn: Michael Healy Tel: (915) 858-3381 Fax: (915) 858-8059 WILLIAMS COMPANIES: Earns $131.9 Million in First Quarter --------------------------------------------------------- Williams Companies, Inc., reported $131.9 million of net income on $3 billion of revenues for the three months ended March 31, 2006, compared to $201.1 million of net income on $2.9 billion of revenues for the same period in 2005. At March 31, 2006, the Company's balance sheet showed $26 billion in total assets and $20.1 billion in total liabilities. A full-text copy of the Company's 2006 Quarterly Report is available for free at http://researcharchives.com/t/s?b01 Headquartered in Tulsa, Oklahoma, Williams Companies, Inc. -- http://www.williams.com/-- through its subsidiaries, primarily finds, produces, gathers, processes and transports natural gas. The company also manages a wholesale power business. Williams' operations are concentrated in the Pacific Northwest, Rocky Mountains, Gulf Coast, Southern California and Eastern Seaboard. * * * As reported in the Troubled Company Reporter on May 17, 2006, Fitch upgraded Williams Companies' outstanding senior unsecured debt and issuer default rating to 'BB+' from 'BB'. As reported in the Troubled Company Reporter on May 8, 2006, Standard & Poor's Ratings Services raised to 'BB-' from 'B+' The Williams Cos. Inc.'s corporate credit rating, including Northwest Pipeline Corp., Transcontinental Gas Pipe Line Corp., and Williams Production RMT Co. S&P said the outlook is positive. * Mauricio Pons Joins Alvarez & Marsal as Director -------------------------------------------------- Alvarez & Marsal Real Estate Advisory Services, LLC announced that Mauricio "Guicho" Pons, an experienced hospitality, tourism and real estate industry professional with domestic and international experience, has joined the firm as director. He is based in Dallas and will be a leader in the hospitality and Latin America practice areas. Mr. Pons brings substantial domestic and international experience, and specializes in advising a variety of hospitality properties including hotels, mixed-use resort developments, hotel condominiums, interval ownership, all-inclusive resorts, and marinas. He also has significant experience with residential, commercial and industrial projects in the US and Latin America. "Since forming A&M Real Estate Advisory Services nearly three years ago, we have attracted a highly sophisticated team of professionals with deep and diverse backgrounds," said Chuck Bedsole, managing director and head of the hospitality and Latin America practices for Alvarez & Marsal Real Estate Advisory Services. "Guicho's broad experience working with scores of hospitality and leisure companies strengthens our impressive roster of talent and industry-specific expertise. In addition, his extensive experience in the field of mergers and acquisitions and transaction support is an ideal complement to the restructuring practice we have established." Prior to joining A&M, Mr. Pons was responsible for the merger and acquisition activities in the Americas for Regus PLC, where his responsibilities included the due diligence, contract/deal negotiation, and post closing implementation and transitioning of the acquisitions. He also served as a manager in the transaction advisory services group of PricewaterhouseCoopers, and began his career in the real estate audit group at Ernst & Young. Mr. Pons earned his bachelor's degree in accounting and finance from Texas A&M University. He serves as an executive board member of the Dallas Center for Contemporary Art, and is fluent in Spanish. A&M Real Estate Advisory Services Alvarez & Marsal Real Estate Advisory Services, LLC advises owners, investors, lenders, and users of real estate throughout the real estate lifecycle. Alvarez & Marsal Real Estate Advisory Services professionals align their interests with those of their clients, and are committed to providing senior-level attention, the right resources, objective advice and flawless execution to every engagement. Building on Alvarez & Marsal's operational and problem-solving heritage, the Alvarez & Marsal Real Estate Advisory Services team develops and implements detailed real estate plans that improve operations, unlock value and minimize risk. Alvarez & Marsal Real Estate Advisory services include: Restructuring Advisory, Litigation Advisory, Strategy and Operations Consulting, Corporate Finance, Transaction Advisory, Public Sector Advisory, Hospitality Advisory, and Latin America Advisory. Alvarez & Marsal Real Estate Advisory Services, LLC is an affiliate of Alvarez & Marsal. Alvarez & Marsal Alvarez & Marsal -- http://www.alvarezandmarsal.com/ -- is a leading global professional services firm with expertise in guiding underperforming companies and public sector entities through complex operational, financial and organizational challenges. The firm excels in problem solving and value creation, and brings a bias toward executing solutions with a distinctive hands-on approach to serving clients, management and stakeholders. Founded in 1983, Alvarez & Marsal draws on its strong operational heritage to provide specialized services, including Turnaround and Management Advisory, Crisis and Interim Management, Performance Improvement, Creditor Advisory Services, Corporate Finance, Dispute Analysis and Forensics, Tax Advisory, Business Consulting, Real Estate Advisory and Transaction Advisory. A network of experienced professionals in locations across the U.S., Europe, Asia and Latin America, enables the firm to deliver on its proven reputation for leadership, problem solving and value creation. * Howard Brod Brownstein Participates in BAPCPA Panel ----------------------------------------------------- Howard Brod Brownstein, CTP, participated in a panel on "Asset Protection after BAPCPA: Testing the Limits" at the 24th Annual American Bankruptcy Institute Spring Meeting on April 22, 2006 in Washington, D.C. The panel was moderated by Rudy J. Cerone, Esq. of McGlinchey Stafford in New Orleans and also featured Thomas O. Wells, Esq. of Berger Singerman in Miami. The program focused on how BAPCPA has made Chapter 11 bankruptcy less attractive relative to non-bankruptcy alternatives, which can be more permissive and forgiving in the area of asset protection for corporations and owners, as well as on how BAPCPA has affected asset protection for individual debtors in the context of state law, homestead, and retirement exemptions, and the use of self- settled trusts. For a copy of the panel's materials, contact: Teresa Kohl NachmanHaysBrownstein, Inc. Phone: 610-660-0060 NachmanHaysBrownstein, Inc. is one of the country's premier mid- market turnaround and crisis management firms, having been included among the "Outstanding Turnaround Firms" in Turnarounds & Workouts for the past eleven consecutive years. NHB has its headquarters near Philadelphia and has offices in New York, Boston, Wilmington and Atlanta. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- June 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION Afghanistan - The Ultimate Turnaround Challenge Oak Hill Country Club, Rochester, New York Contact: http://www.turnaround.org/ June 15-18, 2006 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort, Traverse City, Michigan Contact: 1-703-739-0800; http://www.abiworld.org/ June 20, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast TBA, Morristown, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ June 21-23, 2006 TURNAROUND MANAGEMENT ASSOCIATION Global Educational Symposium Hyatt Regency, Chicago, Illinois Contact: http://www.turnaround.org/ June 22-23, 2006 BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES Ninth Annual Conference on Corporate Reorganizations Successful Strategies for Restructuring Troubled Companies The Millennium Knickerbocker Hotel, Chicago, Illinois Contact: 903-595-3800; 1-800-726-2524; http://www.renaissanceamerican.com/ June 27, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ June 27, 2006 TURNAROUND MANAGEMENT ASSOCIATION What to Do When Internal Crime Strikes Your Company New Jersey Contact: http://www.turnaround.org/ June 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION 5th Annual Lenders Panel - Arizona Chapter National Bank of Arizona Conference Center, Phoenix, AZ Contact: http://www.turnaround.org/ June 29 - July 2, 2006 NORTON INSTITUTES ON BANKRUPTCY LAW Bankruptcy Law Institute Jackson Lake Lodge, Jackson Hole, Wyoming Contact: 770-535-7722 or http://www2.nortoninstitutes.org/ July 11, 2006 TURNAROUND MANAGEMENT ASSOCIATION The New Bankruptcy Code Nine Months Later Rivers Club, Pittsburgh, Pennsylvania Contact: http://www.turnaround.org/ July 12, 2006 BEARD AUDIO CONFERENCES Clash of the Titans -- Bankruptcy vs. IP Rights Audio Conference Contact: 240-629-3300; http://www.beardaudioconferences.com July 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Function Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ July 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Center Club, Baltimore, Maryland Contact: 703-912-3309 or http://www.turnaround.org/ July 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Women's Event TBA, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ July 13-16, 2006 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Newport Marriott, Newport, Rhode Island Contact: 1-703-739-0800; http://www.abiworld.org/ July 18, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast Marriott, Red Bank, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ July 18-19, 2006 TURNAROUND MANAGEMENT ASSOCIATION Distressed & Turnaround Investing Congress Swiss"tel The Drake, New York, New York Contact: http://www.turnaround.org/ July 19, 2006 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner South Florida Contact: 561-882-1331 or http://www.turnaround.org/ July 25, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Centre Club, Tampa, Florida Contact: 561-882-1331 or http://www.turnaround.org/ July 26, 2006 BEARD AUDIO CONFERENCES Distressed Market Opportunities Audio Conference Contact: 240-629-3300; http://www.beardaudioconferences.com July 26-29, 2006 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz Carlton Amelia Island, Amelia Island, Florida Contact: 1-703-739-0800; http://www.abiworld.org/ July 31, 2006 TURNAROUND MANAGEMENT ASSOCIATION Annual Golf & Tennis Outing Raritan Valley Country Club, Bridgewater, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ July 31, 2006 TURNAROUND MANAGEMENT ASSOCIATION Summer Social BBQ Colonial Springs Country Club, Long Island, New York Contact: 631-251-6296 or http://www.turnaround.org/ August 3, 2006 TURNAROUND MANAGEMENT ASSOCIATION Commercial Lenders Breakfast Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ August 3-5, 2006 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Maryland Contact: 1-703-739-0800; http://www.abiworld.org/ August 9, 2006 TURNAROUND MANAGEMENT ASSOCIATION Professional Development Meeting Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ August 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION DIP Panel Discussion Kansas City, Missouri Contact: http://www.turnaround.org/ August 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Family Night Baseball with the NJ Jackals (Yogi Berra Autograph Night) Jackals Stadium, Montclair, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ August 25, 2006 TURNAROUND MANAGEMENT ASSOCIATION Annual Fishing Trip Point Pleasant, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ August 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ September 6, 2006 TURNAROUND MANAGEMENT ASSOCIATION 4th Annual Alberta Golf Tournament Kananaskis Country Golf Course, Kananaskis, Alberta Contact: 403-294-4954 or http://www.turnaround.org/ September 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Business Mixer TBA, Seattle, Washington Contact: 503-223-6222 or http://www.turnaround.org/ September 7-8, 2006 TURNAROUND MANAGEMENT ASSOCIATION Saratoga Regional Conference Gideon Putnam Hotel, Saratoga Springs, New York Contact: http://www.turnaround.org/ September 7-9, 2006 AMERICAN BANKRUPTCY INSTITUTE Southwest Bankruptcy Conference Wynn Las Vegas, Las Vegas, Nevada Contact: 1-703-739-0800; http://www.abiworld.org/ September 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Marriott Tyson's Corner, Vienna, Virginia Contact: 703-912-3309 or http://www.turnaround.org/ September 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast TBA, Secaucus, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ September 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION LI Turnaround Formal Event Long Island, New York Contact: http://www.turnaround.org/ September 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Function Sydney, Australia Contact: 0438 653 179 or www.turnaround.org September 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Formal Event - Major Speaker to be Announced Long Island, New York Contact: 631-251-6296 or http://www.turnaround.org/ September 17-24, 2006 NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES Optional Alaska Cruise Seattle, Washington Contact: 800-929-3598 or http://www.nabt.com/ September 20, 2006 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner Bankers Club, Miami, Florida Contact: 561-882-1331 or http://www.turnaround.org/ September 24, 2006 TURNAROUND MANAGEMENT ASSOCIATION Restructuring the Troubled High Tech Company Arizona Contact: http://www.turnaround.org/ September 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Centre Club, Tampa, Florida Contact: 561-882-1331 or http://www.turnaround.org/ September 27, 2006 TURNAROUND MANAGEMENT ASSOCIATION Joint Education Program with NYIC Joint Reception CFA/RMA/IWIRC Woodbridge Hilton, Iselin, NJ Contact: http://www.turnaround.org/ September 27, 2006 TURNAROUND MANAGEMENT ASSOCIATION 7th Annual Cross Border Business Restructuring and Turnaround Conference Banff, Alberta Contact: http://www.turnaround.org/ October 5, 2006 TURNAROUND MANAGEMENT ASSOCIATION Commercial Lenders Breakfast Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 10, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Center Club, Baltimore, Maryland Contact: 703-912-3309 or http://www.turnaround.org/ October 11, 2006 TURNAROUND MANAGEMENT ASSOCIATION Professional Development Meeting Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 11-14, 2006 TURNAROUND MANAGEMENT ASSOCIATION 2006 Annual Conference Milleridge Cottage, Long Island, New York Contact: 312-578-6900; http://www.turnaround.org/ October 17, 2006 TURNAROUND MANAGEMENT ASSOCIATION Updates on the New Bankruptcy Law Kansas City, Missouri Contact: http://www.turnaround.org/ October 19, 2006 TURNAROUND MANAGEMENT ASSOCIATION Billards Networking Night - Young Professionals TBA, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ October 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Speaker Series #3 TBA, Calgary, Alberta Contact: 403-294-4954 or http://www.turnaround.org/ October 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Speaker Series #3 TBA, Calgary, Alberta Contact: 403-294-4954 or http://www.turnaround.org/ October 31, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ October 31 - November 1, 2006 INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION IWIRC Annual Conference San Francisco, California Contact: http://www.iwirc.com/ November 1, 2006 TURNAROUND MANAGEMENT ASSOCIATION Halloween Isn't Over! - Ghosts of turnarounds past who remind you about what you should have done differently Portland, Oregon Contact: http://www.turnaround.org/ November 1-4, 2006 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges San Francisco, California Contact: http://www.ncbj.org/ November 2-3, 2006 BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES Third Annual Conference on Physician Agreements & Ventures Successful Strategies for Medical Transactions and Investments The Millennium Knickerbocker Hotel - Chicago Contact: 903-595-3800; 1-800-726-2524; http://www.renaissanceamerican.com/ November 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast Marriott, Bridgewater, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Marriott Tyson's Corner, Vienna, Virginia Contact: 703-912-3309 or http://www.turnaround.org/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION TMA Australia National Conference Sydney, Australia Contact: http://www.turnaround.org/ November 14, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Program St. Louis, Missouri Contact: 815-469-2935 or http://www.turnaround.org/ November 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION Joint Reception with NYIC/NYTMA TBA, New York Contact: 908-575-7333 or http://www.turnaround.org/ November 15, 2006 LI TMA Formal Event TMA Australia National Conference Long Island, New York Contact: http://www.turnaround.org/ November 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ November 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Bankruptcy Judges Panel Duquesne Club, Pittsburgh, Pennsylvania Contact: http://www.turnaround.org/ November 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Dinner Program TBA, Seattle, Washington Contact: 503-223-6222 or http://www.turnaround.org/ November 23, 2006 TURNAROUND MANAGEMENT ASSOCIATION Martini Party Vancouver, British Columbia Contact: 403-294-4954 or http://www.turnaround.org/ November 27-28, 2006 BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES Thirteenth Annual Conference on Distressed Investing Maximizing Profits in the Distressed Debt Market The Essex House Hotel - New York Contact: 903-595-3800; 1-800-726-2524; http://www.renaissanceamerican.com/ November 28, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Centre Club, Tampa, FL Contact: 561-882-1331 or http://www.turnaround.org/ November 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION Special Program TBA, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ November 30-December 2, 2006 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Hyatt Regency at Gainey Ranch, Scottsdale, Arizona Contact: 1-703-739-0800; http://www.abiworld.org/ December 6, 2006 TURNAROUND MANAGEMENT ASSOCIATION Holiday Dinner Portland, Oregon Contact: 503-223-6222 or http://www.turnaround.org/ December 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast The Newark Club, Newark, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ December 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION LI TMA Holiday Party TBA, Long Island, New York Contact: 631-251-6296 or http://www.turnaround.org/ December 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Christmas Function GE Commercial Finance, Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ February 2007 AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium San Juan, Puerto Rico Contact: 1-703-739-0800; http://www.abiworld.org/ April 11-15, 2007 AMERICAN BANKRUPTCY INSTITUTE ABI Annual Spring Meeting J.W. Marriott, Washington, DC Contact: 1-703-739-0800; http://www.abiworld.org/ March 27-31, 2007 TURNAROUND MANAGEMENT ASSOCIATION Spring Conference Four Seasons Las Colinas, Dallas, Texas Contact: http://www.turnaround.org/ March 29-31, 2007 ALI-ABA Chapter 11 Business Reorganizations Scottsdale, Arizona Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/ June 6-9, 2007 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS 23rd Annual Bankruptcy & Restructuring Conference Westin River North, Chicago, Illinois Contact: http://www.airacira.org/ June 14-17, 2007 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort, Traverse City, Michigan Contact: 1-703-739-0800; http://www.abiworld.org/ July 12-15, 2007 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Marriott, Newport, RI Contact: 1-703-739-0800; http://www.abiworld.org/ October 10-13, 2007 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Orlando, Florida Contact: http://www.ncbj.org/ October 16-19, 2007 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Copley Place, Boston, Massachusetts Contact: 312-578-6900; http://www.turnaround.org/ December 6-8, 2007 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Westin Mission Hills Resort, Rancho Mirage, California Contact: 1-703-739-0800; http://www.abiworld.org/ March 25-29, 2008 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference Ritz Carlton Grande Lakes, Orlando, Florida Contact: http://www.turnaround.org/ September 24-27, 2008 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Scottsdale, Arizona Contact: http://www.ncbj.org/ October 28-31, 2008 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Copley Place, Boston, Massachusetts Contact: 312-578-6900; http://www.turnaround.org/ October 5-9, 2009 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Desert Ridge, Phoenix, Arizona Contact: 312-578-6900; http://www.turnaround.org/ 2009 (TBA) NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Las Vegas, Nevada Contact: http://www.ncbj.org/ October 4-8, 2010 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention JW Marriott Grande Lakes, Orlando, Florida Contact: http://www.turnaround.org/ 2010 (TBA) NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges New Orleans, Louisiana Contact: http://www.ncbj.org/ BEARD AUDIO CONFERENCES Coming Changes in Small Business Bankruptcy Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Distressed Real Estate under BAPCPA Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES High-Yield Opportunities in Distressed Investing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Fundamentals of Corporate Bankruptcy and Restructuring Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Reverse Mergers - the New IPO? Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Dana's Chapter 11 Filing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Employee Benefits and Executive Compensation under the New Code Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Validating Distressed Security Portfolios: Year-End Price Validation and Risk Assessment Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Changing Roles & Responsibilities of Creditors' Committees Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Calpine's Chapter 11 Filing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Healthcare Bankruptcy Reforms Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Changes to Cross-Border Insolvencies Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES The Emerging Role of Corporate Compliance Panels Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com BEARD AUDIO CONFERENCES Privacy Rights, Protections & Pitfalls in Bankruptcy Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com BEARD AUDIO CONFERENCES High-Yield Opportunities in Distressed Investing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com The Meetings, Conferences and Seminars column appears in the Troubled Company Reporter each Wednesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. 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. Marie Therese V. Profetana, Shimero Jainga, Joel Anthony G. Lopez, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Cherry A. Soriano-Baaclo, Christian Q. Salta, Jason A. Nieva, Lucilo M. Pinili, Jr., 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. *** End of Transmission ***