TCR_Public/060818.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, August 18, 2006, Vol. 10, No. 196

                             Headlines

ACURA PHARMA: Bridge Lenders Extends Maturity Date to October 1
ADELPHIA COMMS: Balance Sheet Upside-Down by $8.37 Bil. at June 30
ADELPHIA COMMS: Plans IPO on 33-1/3% of Class A Common Stock
ALLEGHENY ENERGY: Subsidiary Issues $145 Mil. First Mortgage Bonds
ALLIED HOLDINGS: Posts $8.2MM Net Loss in Quarter Ended March 31

ALLIED HOLDINGS: Newlin Barred from Collecting $1.5 Mil. Judgment
ARCH COAL: Gets One-Third Interest in Knight Hawk for $15 Million
ARCH COAL: Moody's Withdraws Ba2 Rating on Senior Sec. Facility
ARMSTRONG WORLD: Wants Sea-Pac's $4.9 Million Claim Expunged
BIOENVELOP TECH: Files Notice of Intention Under Canadian BIA

BLOUNT INT'L: Equity Deficit Narrows to $122.81 Million at June 30
BRICOLAGE CAPITAL: Has Until Sept. 15 to Decide on Lexington Lease
CARDINAL COMMS: Get-A-Phone Unit Files for Chapter 11 Protection
CARROLS CORP: Moody's Junks $180 Million Sr. Sub. Notes' Rating
CHARMING SHOPPES: Moody's Holds Ratings & Says Outlook is Positive

CHURCH & DWIGHT: Earns $36.4 Million in 2nd Quarter Ended June 30
COLLINS & AIKMAN: Delays Form 10-Q and Form 10-K Filing
COLLINS & AIKMAN: 10-3/4% Bonds' Price Plummets to All-Time Low
COMPLETE RETREATS: Selects XRoads Case Management as Claims Agent
COMPLETE RETREATS: Court Denies Intagio's Reservations Request

CONSTELLATION BRANDS: Inks Pact to Sell $700 Mil. of 7.25% Notes
CONSTELLATION BRANDS: Fitch Affirms Low-B Ratings
COPELANDS' ENTERPRISES: Names Barry Soosman as New CEO
DANA CORP: Dana Credit Reports $47-Mil. Tax Sharing Receivable
DANA CORP: Invests $7.6 Million for St. Clair Plant Upgrades

DELPHI CORPORATION: Methode Asserts Set-Off Rights Over Rebates
DELTA AIR: Teamsters and Comair to Resume Talks on Aug. 23 and 24
DIAGNOSTIC IMAGING: S&P Downgrades Corporate Credit Rating to B
DIRECTV GROUP: Earns $458.7 Million in Quarter Ended June 30
DURA AUTOMOTIVE: Hires Miller Buckfire as Restructuring Consultant

EASTGROUP PROPERTIES: Earns $5.5 Million in Quarter Ended June 30
EATON FERRY: Court Okays Rule 2004 Examination to Find Collateral
ENRON CORP: Court Approves Nile Structure Settlement Agreement
ENTERGY NEW ORLEANS: Seeks City Council Consent for Rates Hike
FEDERAL MOGUL: Insists Kenesis Group is "Disinterested"

FEDERAL-MOGUL: To Spend $6 Million Missouri  in Plant Closure
FLYI INC: Files Disclosure Statement & Liquidation Plan in Del.
FLYI INC: Unsecured Creditors Likely to Receive 10.5% of Claims
FORD MOTOR: Plans to Expand & Accelerate Restructuring Plan
FUTURE MEDIA: Wants to Hire Silver & Freedman as Special Counsel

GENOIL INC: David Kippen Steps in as Interim CFO
GLOBAL DOCUGRAPHIX: Gets Court Final Nod to Use Cash Collateral
GMAC LLC: S&P May Raise Ratings After 51% Ownership Interest Sale
GRUPO IUSACELL: To Execute Convenio Concursal With Creditors
HINES HORTICULTURE: Posts $774,000 2006 Second Quarter Net Loss

INCO LTD: Board Says CVRD Offer Could Be a Superior Proposal
INCO LIMITED: Teck Cominco Withdraws Proposed Equity Offering
IPIX CORPORATION: Selling All Assets Under Chapter 7
KAISER ALUMINUM: Parties Respond to Agrium's Move to Pursue Claim
KNOLOGY INC: S&P Junks Ratings on $150 Million Shelf Registration

LAND O'LAKES: S&P Rates $225 Million Senior Credit Facility at BB+
LEVITZ HOME: Names Jane Gilmartin as Merchandising Head
LEVITZ HOME: Allows Creditors' Panel to Pursue Estate Actions
LIQUIDMETAL TECH: June 30 Balance Sheet Upside-Down by $10.8 Mil.
MAGNA ENT: June 30 Working Capital Deficit is $139.9 Million

METROMEDIA INT'L: Delays Filing of 2006 Second Quarter Form 10-Q
METROMEDIA INT'L: Postpones Reporting of Magticom's Financials
MIRANT: Asset Recovery Agrees to Keep BofA's Info Confidential
MOBILE TOOL: Court Approves Settlement with Sifa and Lupe Tuiaki
NATIONAL CENTURY: Court OKs Pact Expunging Epstein Becker's Claims

NATIONAL CENTURY: LTC Entities' Lawsuit Stayed Until August 28
NORTH AMERICAN: June 30 Balance Sheet Upside-Down by $10.9 Million
NORTHWEST AIRLINES: Court Allows Flight Attendants to Hold Strike
NORTHWEST AIRLINES: To Appeal Court's Decision on Strike Sanction
OCA INC: Hires Postlethwaite & Netterville as Accountants

OCA INC: Equity Panel Hires Imperial Capital as Financial Advisor
ONE TO ONE: Court Sets Plan Confirmation Hearing on September 11
PAETEC COMMS: US LEC Merger Prompts Moody's To Review Rating
PAN AM: Creditors to Get $30 Million from Libyan Suit Settlement
PEMCO AVIATION: Low Earnings Prompt Credit Facility Default

PEMCO AVIATION: Earns $445,000 in Quarter Ended June 30
PLIANT CORP: Court Approves EPA Settlement Agreement
PLIANT CORP: Issues New Common Stock & New Preferred Stock
PREMIUM PAPERS: Selling Smart Papers to Plainfield Asset
QUANTUM CORPORATION: Moody's Rates $375 Million Loans at B2

QUEBECOR WORLD: Moody's Reviews Low-B Ratings and May Downgrade
RESORTS INT'L: Poor 2nd Quarter Performance Cues S&P's Neg. Watch
SAINT VINCENTS: Klapholz Says UMNDJ Funds are not Estate Property
SAINT VINCENTS: Panel Resolves Loan Dispute with First American
SATELITES MEXICANOS: Disclosure Statement Hearing Set for Sept. 6

SATELITES MEXICANOS: Wants Court Nod on Solicitation Procedures
SHERIDAN GROUP: Financial Risk Cues Moody's to Downgrade Ratings
SILICON GRAPHICS: Committee Taps FTI as Financial Advisors
SOLO CUP: Moody's Reviews Low-B Ratings and May Downgrade
TEX STAR: Wants Exclusive Plan-Filing Period Stretched to Dec. 1

TKO SPORTS: Plan Confirmation Hearing Set for August 23
TRUMP ENT: Court Okays Pact Allowing SMG to Pursue Taj Mahal Claim
TRUMP ENT: Breaks Ground on $250 Mil. Hotel at Taj Majal Casino
UNIGENE LABORATORIES: June 30 Balance Sheet Upside-Down by $8.9MM
UNITED MEDICORP: Acquires Incipient Healthcare Contract Rights

UNITED RENTALS: Earns $56 Million in Quarter Ended June 30
USA COMMERCIAL: Court Okays Lewis and Roca as Panel's Counsel
USA COMMERCIAL: Panels Hire Stutman Treister as Special Counsel
USA COMMERCIAL: Panels Hire Shea & Carlyon as Nevada Counsel
US LEC: Paetec Merger Prompts Moody's to Hold Ratings

U.S. MICROBICS: June 30 Balance Sheet Upside-Down by $7.3 Million
VERESTAR INC: PanAmSat Holds $5.78 Million Allowed Unsecured Claim
VIRAGEN INC: Posts $3.6 Mil. Net Loss for Quarter Ended March 31
VIRAGEN INT'L: March 31 Balance Sheet Upside-Down by $13.9 Mil.
WATTSHEALTH FOUNDATION: Settlement Resolves $15 Million of Claims

WATTSHEALTH FOUNDATION: Plan Filing-Period Stretched to Sept. 15
WINN-DIXIE: Files Final Joint Plan & Disclosure Statement
WINN-DIXIE: Panel Taps Spencer Stuart to Search for Directors
WISE METALS: Negative Cash Flow Prompts S&P to Junk Ratings
WOLF HOLLOW: S&P Affirms $110 Mil. 2nd-Lien Term Loan's B Rating

WORLD WIDE: Trustee Hires John Bohl & Associates as Accountants
WORLD WIDE: Court Sets December 13 as Deadline for Filing Claims

* BOOK REVIEW: Debtors and Creditors in America

                             *********

ACURA PHARMA: Bridge Lenders Extends Maturity Date to October 1
-----------------------------------------------------------------
Acura Pharmaceuticals, Inc. secured gross proceeds of $450,000
under a term loan agreement with Essex Woodlands Health Ventures
V, L.P., Care Capital Investments II, L.P., Care Capital Offshore
Investments II, L.P., Galen Partners III, L.P., Galen Partners
International III, L.P. and Galen Employee Fund III, L.P.

Coincident with this Loan, the Bridge Lenders have agreed to
change the maturity date on all previous bridge loans to Oct. 1,
2006 from Sept. 1, 2006.  The Loan bears an annual interest rate
of 10%, is secured by a lien on all assets of the Company and its
subsidiary, matures on Oct. 1, 2006, and is senior to all other
Company debt.  The Loan permits the funding of additional cash
amounts subject to agreement by the Company and the Bridge
Lenders.  No assurance can be given, however, that any additional
funding will be advanced to the Company under the terms of the
Loan.

In addition, the Company has agreed that that the lenders under
its bridge loan agreements may rollover all or any portion of the
principal and accrued interest outstanding under loans made under
such agreements into the Company's next equity financing of at
least $10 million, subject to certain exceptions.

Including the Loan, the Company has a total of $5.6 million in
bridge loans outstanding and due on Oct. 1, 2006.

The Company will utilize the net proceeds from the Loan to
continue funding product development and licensing activities
relating to OxyADF(TM) tablets and other product candidates
utilizing its Aversion(R) Technology.

                      Cash Reserves Update

The Company estimates that its current cash reserves, including
the net proceeds from the Loan, will fund product development and
licensing activities through mid-September 2006.  To continue
operating thereafter, the Company must raise additional financing
or enter into appropriate collaboration agreements with third
parties providing for cash payments to the Company.  No assurance
can be given that the Company will be successful in obtaining any
such financing or in securing collaborative agreements with third
parties on acceptable terms, if at all, or if secured, that such
financing or collaborative agreements will provide for payments to
the Company sufficient to continue funding operations.  In the
absence of such financing or third-party collaborative agreements,
the Company will be required to scale back or terminate operations
and/or seek protection under applicable bankruptcy laws.

                   About Acura Pharmaceuticals

Headquartered in Palatine, Illinois, Acura Pharmaceuticals, Inc.
-- http://www.acurapharm.com/-- is a specialty pharmaceutical
company engaged in research, development and manufacture of
innovative and proprietary abuse deterrent, abuse resistant and
tamper resistant formulations intended for use in orally
administered opioid-containing prescription analgesic products.
Acura is actively collaborating with contract research
organizations for laboratory and clinical evaluation and testing
of product candidates formulated with its Aversion(R) Technology.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on Aug. 8, 2006,
BDO Seidman, LLP, expressed substantial doubt about Acura
Pharmaceuticals' ability to continue as a going concern after
auditing the Company's 2005 financial statements.  The auditing
firm pointed to the Company's recurring losses from operations and
net capital deficiency at Dec. 31, 2005.


ADELPHIA COMMS: Balance Sheet Upside-Down by $8.37 Bil. at June 30
------------------------------------------------------------------
Adelphia Communications Corp. incurred a $11.29 million net loss
for the second quarter ending June 30, 2006, the Company disclosed
on a Form 10-Q filing delivered to the Securities and Exchange
Commission on Aug. 14, 2006.

             Current and Future Sources Of Liquidity

Since ACOM and its debtor-affiliates filed for bankruptcy, they
utilized cash provided by operating activities and borrowings
under their debtor-in-financing facilities to fund capital
expenditures and other liquidity requirements.

On March 17, 2006, the Loan Parties entered into the $1.3 billion
Third Extended DIP Facility, which superseded and replaced in its
entirety the Second Extended DIP Facility.  The Third Extended DIP
Facility was approved by the Bankruptcy Court on March 16, 2006
and closed on March 17, 2006.  In connection with the completion
of the Sale Transaction, on the Effective Date, the Debtors
terminated the Third Extended DIP Facility.  In connection with
the termination of the Third Extended DIP Facility, they repaid
all loans outstanding under the Third Extended DIP Facility and
all accrued and unpaid interest thereon, with such payments
totaling approximately $986 million.  In addition, in connection
with the termination of the Third Extended DIP Facility we paid
all accrued and unpaid fees of the lenders and agent banks under
the Third Extended DIP Facility.  In connection with these
payments, effective as of the Effective Date, the collateral agent
under the Third Extended DIP Facility released any and all liens
and security interests on the assets that collateralized the
obligations under the Third Extended DIP Facility.  As a result of
the termination of the Third Extended DIP Facility, on the
Effective Date, the Debtors collateralized letters of credit
issued under the Third Extended DIP Facility with cash of $88
million.

The Debtors also expect to pay around $1.8 billion of claims in
the third quarter of 2006 in accordance with the Plan for the
Century TCI and Parnassos Debtors, of which approximately
$1.6 billion relates to prepetition debt obligations.  The Debtors
paid $1.2 billion of such prepetition debt obligations on the
Effective Date.  The remaining proceeds from the Sale Transaction
will be used to fund their future liquidity requirements which
consist primarily of prepetition liabilities that are subject to
compromise, fees and other items directly related to the Chapter
11 filings and costs associated with certain corporate functions
that will continue either in part or in whole for some period of
time following the Sale Transaction.  They do not have any
additional sources of liquidity.

At June 30, 2006, the Debtors have $18.42 billion of prepetition
liabilities that are subject to compromise.  They currently cannot
predict the amount of cash that will be required to settle
prepetition liabilities subject to compromise, as the rights and
claims of their various creditors will be determined by a plan of
reorganization that is ultimately subject to confirmation by the
Bankruptcy Court.  Proceeds from the Sale Transaction are not
sufficient to provide a full payout of all outstanding claims in
the Chapter 11 Cases.

A full-text copy of Adelphia Communications Corporation's
quarterly report for the period ended June 30, 2006, is available
for free at http://ResearchArchives.com/t/s?fcd

             Adelphia Communications Corporation, et al.
           Unaudited Condensed Consolidated Balance Sheet
                          At June 30, 2006
                       (Dollars in thousands)

                               ASSETS

Cash and cash equivalents                             $734,447
Restricted cash                                          3,893
Accounts receivable, less allowance
    for doubtful accounts                              108,094
Receivable for securities                                7,167
Other current assets                                    89,222
                                                    -----------
Total current assets                                  $942,823

Noncurrent assets:
Restricted cash                                         $2,751
Property and equipment, net                          4,223,605
Intangible assets, net                               7,479,647
Other non-current assets, net                          126,741
                                                    -----------
Total assets                                       $12,775,567
                                                    ===========
                LIABILITIES AND STOCKHOLDERS' DEFICIT

Accounts payable                                      $115,871
Subscriber advance payments and deposits                34,020
Accrued liabilities                                    543,672
Deferred revenue                                        19,115
Parent and subsidiary debt                             959,427
                                                    -----------
Total current liabilities                           $1,672,105

Non-current liabilities:
    Other liabilities                                  $32,119
    Deferred revenue                                    56,149
    Deferred income taxes                              904,135
                                                    -----------
Total non-current liabilities                          992,403

Liabilities subject to compromise                   18,423,946
                                                    -----------
Total liabilities                                  $21,088,454

Commitments and contingencies

Minority's interest                                     60,201

Stockholders' deficit:
    Series preferred stock                                 397
    Class A Common Stock                                 2,297
    Convertible Class B Common Stock                       251
    Additional paid-in capital                      12,024,695
    Accumulated other comprehensive loss, net           (2,851)
    Accumulated deficit                            (20,369,940)
    Treasury stock                                     (27,937)
                                                    -----------
Total stockholders' deficit                         (8,373,088)
                                                    -----------
Total liabilities and stockholders' deficit        $12,775,567
                                                    ===========

             Adelphia Communications Corporation, et al.
      Unaudited Condensed Consolidated Statement of Operations
                  Three Months Ended June 30, 2006
                       (Dollars in thousands)

Revenue                                             $1,198,279

Costs and expenses:
    Direct operating and programming                   704,560
    Selling, general and administrative                 90,164
    Investigation, re-audit and
       sale transaction costs                            9,626
    Depreciation                                       191,780
    Amortization                                        33,231
    Provision for uncollectible
       amounts due from the Rigas Family
       and Rigas Family Entities                            -
    Loss (gain) on disposition of
       long-lived assets                                  (394)
                                                    -----------
Total costs and expenses                             1,028,967
                                                    -----------
Operating income                                       169,312
                                                    -----------

Other income (expense), net:
    Interest expense, net                              (219,642)
    Other income (expense), net                         (34,436)
                                                    -----------
Total other income (expense), net                     (254,078)
                                                    -----------
Income (loss) before reorganization
    income (expenses), income taxes,
    share of income (losses) of equity
    affiliates and minority's interest                 (84,766)

Reorganization income (expenses), net                   84,623
                                                    -----------
Income (loss) before income taxes,
    share of income (losses) of equity
    affiliates and minority's interest                    (143)
Income tax expense                                     (21,418)
Share of income (losses) of equity
    affiliates, net                                         92
Minority's interest in loss of
    subsidiary                                          10,173
                                                    -----------
Net income (loss)                                     ($11,296)
                                                    ===========

             Adelphia Communications Corporation, et al.
      Unaudited Condensed Consolidated Statement of Cash Flows
                 Six Months Ended June 30, 2006
                       (Dollars in thousands)

Cash flows from operating activities:
    Net income (loss)                                 ($182,912)
    Adjustments to reconcile net income (loss)
    to net cash provided by operating activities:
       Depreciation                                     379,907
       Amortization                                      66,531
       Provision for uncollectible amounts due from
          the Rigas Family and Other Rigas Entities           0
       Gain on disposition of long-lived assets          (1,358)
       Settlement with the Rigas Family and Rigas
       Family Entities, net                                   0
       Impairment of receivable for securities            2,862
       Amortization/write-off of deferred
          financing costs                                 1,520
       Provision for settlements                         44,915
       Other noncash charges, net                         1,424
       Reorganization (income) expenses due to
          bankruptcy, net                               (62,639)
       Deferred income tax expense                       70,600
       Share of losses of equity affiliates, net            818
       Minority's interest in loss of subsidiary        (11,106)
       Change in operating assets and liabilities         9,205
                                                    -----------
Net cash provided by operating activities
    before payment of reorganization expenses           319,767

Reorganization expenses paid during
    the period                                          (58,680)
                                                    -----------
Net cash provided by operating activities               261,087
                                                    -----------
Investing activities:
    Capital expenditures for property &
       equipment                                       (284,621)
    Proceeds from the sale of long-lived assets
       and investments                                    1,586
    Acquisition of minority interests                         0
    Change in restricted cash                           281,532
    Other                                                (4,605)
                                                    -----------
Net cash used in investing activities                    (6,108)
                                                    -----------
Financing activities:
    Proceeds from debt                                1,023,000
    Repayments of debt                                 (932,471)
    Payments of deferred financing costs                   (900)
                                                    -----------
Net cash provided by financing activities                89,629
                                                    -----------
Increase (decrease) in cash & cash equivalents          344,608
                                                    -----------
Cash & cash equivalents at beginning of period          389,839
                                                    -----------
Cash & cash equivalents at end of period               $734,447
                                                    ===========

                  About Adelphia Communications

Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie Farr
& Gallagher represents the ACOM Debtors.  PricewaterhouseCoopers
serves as the Debtors' financial advisor.  Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642).  Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue Nos. 143 & 144; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


ADELPHIA COMMS: Plans IPO on 33-1/3% of Class A Common Stock
------------------------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission, Adelphia Communications Corporation discloses that
effective July 31, 2006, it entered into a Registration Rights
and Sale Agreement with Time Warner Cable, Inc., pursuant to
which the ACOM will consummate a fully underwritten initial
public offering of at least 33-1/3% of the Class A Common Stock
issued by Time Warner in ACOM's sale transactions with Time
Warner NY Cable LLC and Comcast Corporation within three months
of Time Warner preparing the necessary registration statement and
having it declared effective.

Pursuant to the Registration Rights Agreement, Time Warner is
required to file and have a registration statement covering these
shares declared effective as promptly as possible and in any
event no later than January 31, 2007, subject to certain
exceptions.

ACOM's obligation to consummate the public offering terminates if
it consummates a plan of reorganization as a result of which:

    (i) 75% of the TWC Class A Common Stock that it received in
        the Sale Transaction, excluding TWC Class A Common Stock
        held in escrow pursuant to the Sale Transaction, is
        distributed to creditors and listed on The New York Stock
        Exchange or The Nasdaq National Market within two weeks;
        or

   (ii) 90% of the TWC Class A Common Stock that it received
        in the Sale Transaction, excluding TWC Class A Common
        Stock held in escrow pursuant to the Sale Transaction, is
        distributed to creditors regardless of listing status.

After the initial public offering, ACOM will have the right to a
demand registration and a final registration if the exemption
from registration pursuant to Section 1145 of the Bankruptcy Code
is not available for a distribution of the remaining TWC Class A
Common Stock to its creditors and stakeholders under a Chapter 11
plan of reorganization.

Also pursuant to the Registration Rights Agreement:

    -- Time Warner has the right to elect, in its sole discretion,
       to not rely on Section 1145 of the Bankruptcy Code and
       conduct a final registration for the distribution of the
       remaining TWC Class A Common Stock to its creditors and
       stakeholders; and

    -- ACOM's ability to distribute the TWC Class A Common Stock
       may be subject to lock-up periods following public
       offerings of TWC Class A Common Stock.

A full-text copy of the Registration Rights and Sale Agreement is
available for free at http://ResearchArchives.com/t/s?fcc

                  About Adelphia Communications

Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie Farr
& Gallagher represents the ACOM Debtors.  PricewaterhouseCoopers
serves as the Debtors' financial advisor.  Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642).  Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 145; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)


ALLEGHENY ENERGY: Subsidiary Issues $145 Mil. First Mortgage Bonds
------------------------------------------------------------------
Allegheny Energy, Inc.'s subsidiary, West Penn Power Company, will
issue $145 million, in principal amount, of first mortgage bonds
with a coupon of 5.875 percent and a 10-year maturity.

West Penn Power Company intends to use the net proceeds from the
sale of the bonds to repay a portion of a note payable, to pay a
dividend to Allegheny and for other general corporate purposes.
Allegheny expects to complete the bond issuance on August 16,
2006.

The bonds have not been registered under the Securities Act of
1933 and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements of the Securities Act.

Headquartered in Greensburg, Pennsylvania, Allegheny Energy, Inc.,
(NYSE:AYE) -- http://www.alleghenyenergy.com/-- is an investor-
owned utility consisting of two major businesses.  Allegheny
Energy Supply owns and operates electric generating facilities,
and Allegheny Power delivers low-cost, reliable electric service
to customers in Pennsylvania, West Virginia, Maryland and
Virginia.

                         *     *     *

As reported in the Troubled Company Reporter on June 28, 2006
Fitch upgraded the Issuer Default Rating and senior unsecured debt
ratings of Allegheny Energy, Inc., to 'BB+' from 'BB-'.  The
ratings of Allegheny Energy Supply Company, LLC, and Allegheny
Generating Company (AYE's non-regulated subsidiaries) were also
upgraded by Fitch.  The Rating Outlook for AYE, AE Supply and AGC
is Stable.


ALLIED HOLDINGS: Posts $8.2MM Net Loss in Quarter Ended March 31
----------------------------------------------------------------
Allied Holdings, Inc., delivered its financial results for the
quarter ended March 31, 2006, to the Securities and Exchange
Commission on Aug. 14, 2006.

The Company reported a net loss of $8,288,000 for the quarter
ended March 31 versus a $10,058,000 net loss in the comparable
prior year period.

Revenues were $240.8 million in the first quarter of 2006 versus
revenues of $221 million in the first quarter of 2005, an increase
of 9% or $19.8 million.  The increase in revenues was due
primarily to an increase in revenue per vehicle delivered by the
Company's Automotive Group.

During its Chapter 11 Proceedings the Company renewed contracts
with rate increases with certain major customers.  The Company
estimates that revenues increased by approximately $8.3 million as
a result of these rate increases.

At March 31, the Company's balance sheet showed $195,506,000 in
total stockholders' deficit, compared to a $187,367,000 deficit at
Dec. 31, 2005.

In 2006, the Company continues to be impacted by liquidity
constraints and have been taking various steps to preserve
liquidity, which include:

     -- rescheduling and deferring capital expenditures;

     -- obtaining the Bankruptcy Court's approval to reduce wages
        paid to collective bargaining employees covered under the
        Master Agreement with the IBT by 10% for the months of May
        and June 2006;

     -- obtaining the Bankruptcy Court's approval to delay wage
        and cost of living increases to our collective bargaining
        employees that were previously scheduled to go into effect
        on June 1, 2006;

     -- implementing un-paid furloughs for certain non-bargaining
        employees for certain periods in May and June of 2006;

     -- filing a motion with the Bankruptcy Court to terminate
        certain non-bargaining retiree benefits; and

     -- implementing other internal cost-saving initiatives.

A full-text copy of the Company's quarterly report is available
for free at http://researcharchives.com/t/s?fd3

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 HOLDINGS: Newlin Barred from Collecting $1.5 Mil. Judgment
-----------------------------------------------------------------
At the August 9 hearing on Allied Holdings, Inc., and its debtor-
affiliates' request to hold Stephan G. Newlin in civil contempt
because of his violation of the automatic stay, the U.S.
Bankruptcy Court for the Northern District of Georgia ordered Leon
Jones, who appeared on behalf of Mr. Newlin:

    (i) not to proceed with the State Court action; and

   (ii) not to attempt to collect from the Debtors and non-Debtor
        entities.

The hearing is continued until Mr. Jones files and schedules a
hearing on a motion under Section 362 of the Bankruptcy Code,
Judge Mullins says.

Mr. Newlin had filed a complaint in the Superior Court of Paulding
County, Georgia, in February 2006  seeking to recover monetary
damages against Allied Automotive Group.  The Complaint alleges
that Aaron Allen, an employee of AAG, caused an automobile
collision on Sept. 9, 2004.  Mr. Allen denied any involvement in
the alleged accident.  Mr. Newlin obtained a default judgment
against AAG for $1,575,000 on June 21, 2006.

Harris B. Winsberg, Esq., at Troutman Sanders LLP, in Atlanta,
Georgia, related that despite the Debtors' repeated demand, Mr.
Newlin refused to vacate the judgment.

Mr. Winsberg noted that the Complaint was filed and prosecuted in
violation of the stay and said that Mr. Newlin continues to
violate the stay by attempting to collect on an alleged
prepetition claim.

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 Holdings Bankruptcy News, Issue No. 28;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/ or 215/945-7000)


ARCH COAL: Gets One-Third Interest in Knight Hawk for $15 Million
-----------------------------------------------------------------
Arch Coal, Inc. acquired a one-third interest in Knight Hawk Coal
in exchange for approximately $15 million in cash and 30 million
tons of coal reserves.

"We expect this transaction to create meaningful value for our
shareholders," said Steven F. Leer, Arch's chairman and chief
executive officer.  "With its strong management team and skilled
workforce, Knight Hawk is well positioned for growth. We expect
Illinois Basin coal to play an increasingly vital role in U.S.
energy markets, and we view this transaction as a first step for
Arch in re-entering this important region."

The transaction is expected to be accretive to earnings, effective
immediately.

Following the transaction, Knight Hawk controls approximately
70 million tons of coal reserves in southern Illinois.  The
company expects to ship approximately 3 million tons of coal
from its mining operations during 2006, and to expand production
to nearly 5 million tons by 2008, assuming market conditions
warrant.

In addition to its interest in Knight Hawk, Arch controls
approximately 230 million tons of coal reserves in southern
Illinois.

St. Louis-based Arch Coal, Inc. (NYSE:ACI) is the second largest
coal producer in the United States, with subsidiary operations in
West Virginia, Kentucky, Virginia, Wyoming, Colorado and
Utah.  Through these operations, Arch provides the fuel for
approximately 7% of the electricity generated in the United
States.


ARCH COAL: Moody's Withdraws Ba2 Rating on Senior Sec. Facility
---------------------------------------------------------------
Moody's Investors Service withdrawn its revolving credit rating
for Arch Coal, Inc.  The company recently amended this facility
and it is unrated by Moody's.  Moody's continues to rate Arch
Western Finance LLC's senior notes.

Withdrawals:

Issuer: Arch Coal, Inc.

   * Senior Secured Bank Credit Facility, Withdrawn, previously
     rated Ba2

Arch Coal, Inc., based in St. Louis, Missouri had revenue in 2005
of $2.5 billion.


ARMSTRONG WORLD: Wants Sea-Pac's $4.9 Million Claim Expunged
------------------------------------------------------------
Armstrong World Industries, Inc., asks the U.S. Bankruptcy Court
for the District of Delaware to disallow and expunge Claim No.
4854 asserted by Sea-Pac Sales Company for $4,900,000.

Sea-Pac's Claim is based on AWI's "breaches" of the parties'
agreements:

    (1) a Commercial Flooring Products Distributorship
        Agreement;

    (2) a Residential Flooring Products and Distributorship
        Agreement and Sales/Service Center Agreement.

Pursuant to the Sea-Pac Agreements, AWI appointed Sea-Pac to be a
wholesale distributor of its commercial vinyl floor covering
products, and residential flooring products in the northwestern
United States.

According to Sea-Pac, AWI breached the Commercial Agreement by
appointing and providing its products to a second distributor
within Sea-Pac's exclusive territory.  Because of that breach,
Sea-Pac contends it incurred damages.

Sea-Pac says AWI also breached the Residential Agreement.  AWI
unjustly enriched itself by failing to reimburse Sea-Pac for
certain functions and services.

Additionally, Sea-Pac Claim seeks a claim for attorney's fees and
certain interest.

Jason Madron, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, relates that Sea-Pac did not file a proof of
administrative expense claim on or before November 24, 2003,
deadline.

Mr. Madron notes that, of the $4,900,000 Claim, Sea-Pac seeks
$4,500,000 in administrative expense claim.

The Court set November 8, 2005, as the deadline by which all
parties to "Previously Scheduled Contracts" must file proofs of
claim for any and all claims against AWI.  Previously Scheduled
Contracts are contracts that originally were listed by AWI on
Schedule G to its Schedules of Assets and Liabilities filed at the
outset of its Chapter 11 case, but which the Debtor believes
should no longer be considered executory.

The Sea-Pac Agreements were identified as Previously Scheduled
Contracts because they expired according to their terms.

Sea-Pac filed Claim No. 4854 before the Executory Contracts Bar
Date.

                      Basis for Disallowance

Mr. Madron argues that Claim No. 4854 has no sufficient
documentation to support that Sea-Pac has a valid claim for unjust
enrichment.  In addition, AWI's books and records do not reflect
any evidence with respect to Sea-Pac's Residential Agreement
Breach Claim.

Mr. Madron contends that the Commercial Agreement, in a plain and
unambiguous language, provides Armstrong the explicit right to add
a second distributor of Commercial Flooring Products in Sea-Pac's
territory following the Claimant's failure to meet the annual mill
shipment requirements for 2002.  Hence, Sea-Pac's Commercial
Agreement Breach Claim should be summarily dismissed as a matter
of law.

Any attempt by Sea-Pac to alter the clear and unambiguous language
of the Commercial Agreement with extrinsic or parol evidence
should be rejected, Mr. Madron asserts.

Mr. Madron also argues that Sea-Pac is not entitled to recover any
of the attorney's fees or interest because:

    * the distributor provides no legal or factual support for
      its fee reimbursement; and

    * the Sea-Pac Agreements contain no language that entitles
      Sea-Pac to attorney's fees and interest in the event AWI
      contests its claim.

Mr. Madron further argues that the Sea-Pac Claim is not entitled
to administrative priority because:

    (1) the Claim arises out of prepetition contracts with AWI;
        and

    (2) Sea-Pac has not demonstrated that any transaction giving
        rise to its Claim provided an actual benefit to AWI's
        estate for which AWI has not already compensated.

To the extent that the Sea-Pac Claim is allowed to any extent, AWI
asks the Court to determine that it is a general, unsecured claim
not entitled to any priority in payment under the Bankruptcy Code,
administrative or otherwise.

                      About Armstrong World

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior floor coverings and ceiling
systems, around the world.

The Company and its debtor-affiliates filed for chapter 11
protection on December 6, 2000 (Bankr. Del. Case No. 00-04469).
Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP, and Russell
C. Silberglied, Esq., at Richards, Layton & Finger, P.A.,
represent the Debtors in their restructuring efforts.  The Debtors
tapped the Feinberg Group for analysis, evaluation, and treatment
of personal injury asbestos claims.

Mark Felger, Esq. and David Carickhoff, Esq., at Cozen and
O'Connor, and Robert Drain, Esq., Andrew Rosenberg, Esq., and
Alexander Rohan, Esq., at Paul, Weiss, Rifkind, Wharton &
Garrison, represent the Official Committee of Unsecured Creditors.
The Creditors Committee tapped Houlihan Lokey for financial and
investment advice.  The Official Committee of Asbestos Personal
Injury Claimant hired Ashby & Geddes as counsel.

When the Debtors filed for protection from their creditors, they
listed $4,032,200,000 in total assets and $3,296,900,000 in
liabilities.  (Armstrong Bankruptcy News, Issue No. 95; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


BIOENVELOP TECH: Files Notice of Intention Under Canadian BIA
-------------------------------------------------------------
BioEnvelop Technologies Corporation and its wholly owned
subsidiary, BioEnvelop Inc., have each filed a notice of intention
to make a proposal under the Bankruptcy and Insolvency Act on Aug.
17, 2006.  The Corporation and its subsidiary have each appointed
Andra Giroux, of Andra Giroux Conseils Inc., as trustee.

All of the members of the boards of directors of the Corporation
and BioEnvelop Inc. resigned with effect as of close of business
on Aug. 16, 2006.  As a result of these events, trading in the
shares of the Corporation on the TSX Venture Exchange has been
halted and will not resume unless a new board is appointed and the
other requirements of the Exchange are satisfied.

Quorum Secured Equity Trust, the first ranking secured creditor
of, the Corporation and BioEnvelop Inc., obtained today a court
order appointing AndrAc Giroux Conseils Inc. as interim receiver
over all of the property of the Corporation and BioEnvelop Inc.
with power to sell the business or assets thereof.

                        About Bioenvelop

Based in Quebec, Canada, BioEnvelop Technologies Corporation
(TSX-V: BIE) -- http://www.bioenvelop.com/-- develops,
manufactures and markets Longevita(R) coating solution, a
biodegradable and edible protein-based coating treatment that
prolongs shelf life and inhibits humidity transfer in fresh and
frozen food products, Bari-Kad(TM), a gel or solid film aimed at
the agri-food market, and Miracle Glacage(TM), which addresses the
fruit coating and glaze market.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 15, 2006.
BioEnvelop Technologies Corporation was served on Aug. 10, 2006,
with a notice of default from Quorum Secured Equity Trust under
the secured convertible debentures issued by the Corporation on
March 2, 2006, and May 11, 2006, in the principal amount of
$1.7 million.


BLOUNT INT'L: Equity Deficit Narrows to $122.81 Million at June 30
------------------------------------------------------------------
Blount International, Inc., disclosed financial results for the
second quarter ended June 30, 2006.  Sales from continuing
operations for the quarter were $165.1 million compared to
$177.6 million in last year's second quarter.  Operating income
from continuing operations was $24.0 million compared to
$29.0 million in the second quarter of 2005.

Sales and operating income from continuing operations exclude the
results of the Lawnmower segment, which is now classified as a
discontinued operation.  Income from continuing operations in this
year's second quarter was $10.3 million, compared to $15.7 million
in the comparable period last year.  The results of the second
quarter as compared to last year's were adversely impacted by
foreign currency exchange rates and an increase in the Company's
effective book income tax rate from 18.3% in 2005 to 34.7% in
2006.  Lower shipments of timber harvesting equipment affected the
financial results as compared to last year's second quarter.
This year's second quarter net income was positively impacted by
$1.0 million from an insurance claim.

Commenting on the second quarter, James S. Osterman, Chairman and
Chief Executive Officer, stated: "Our sales performance for the
second quarter was mixed.  Our largest business, the Outdoor
Products segment, continued to post sales in line with the record
levels achieved in 2005, but sales of the Industrial and Power
Equipment segment were impacted by softer market conditions as
compared to last year's second quarter.  Although logging activity
in North America remained stable, logging contractors postponed
equipment purchases, in part due to their rising operating costs.

Looking ahead to the second half of 2006, we are anticipating
similar market conditions to those experienced in the first half.
Sales of the Outdoor Products segment should continue to be equal
to or slightly higher than last year's second half sales.  Sales
for the Industrial and Power Equipment segment are expected to be
below last year's for the remainder of 2006 given the current
North American market conditions.  We expect the softness in North
America will be somewhat offset by continued expansion into
international markets through our agreements with Caterpillar.  In
the second quarter, we purchased the technology for the design and
manufacture of a line of harvester heads for the international
markets to broaden cutting capability on our timber harvesting
equipment.  For the full year, we expect sales from continuing
operations to range between $670 million and $690 million.
Operating income from continuing operations is estimated to range
between $97 million and $101 million.  The operating income range
includes a non-recurring second half expense of approximately
$3.7 million in conjunction with the redesign of the Company's
pension plans to reduce future costs.  The operating income range
also includes $3.0 million in stock-based compensation expense."

                         Segment Results

The Outdoor Products segment reported second quarter sales of
$114.7 million compared to $114.1 million in last year's second
quarter.  Sales order backlog increased to $75.7 million in the
second quarter from $70.3 million in this year's first quarter and
compares to $82.6 million in last year's second quarter.
Geographically, sales were strongest in the domestic markets, with
year-over-year sales growth of 7% achieved in the second quarter.
Sales to original equipment manufacturers increased 5% from last
year's second quarter.  Segment contribution to operating income
was $23.1 million in this year's second quarter compared to
$26.8 million in last year's second quarter.  The year-over-year
decrease in segment contribution to operating income includes a
$2.4 million negative impact from movement in foreign currency
exchange rates.

The Industrial and Power Equipment segment's second quarter
sales were $50.6 million, up slightly from the first quarter
of this year, but below last year's second quarter amount of
$63.7 million.  Segment contribution to operating income was
$4.7 million compared to $6.4 million in last year's second
quarter.  A decline in shipments of timber-harvesting equipment
was the primary reason for both the sales and contribution
declines from last year's second quarter.  Sales of Caterpillar
branded product increased 25% from this year's first quarter but
were below last year's second quarter, consistent with the sales
trends of Blount branded products.  The weaker demand and
associated orders for our timber-harvesting equipment within North
America reflect customers' concerns about the near term outlook
for logging activity and higher operating costs.  Backlog for this
segment as of June 30 was $37.0 million compared to $38.0 million
in this year's first quarter and $74.4 million in last year's
second quarter.

                     Discontinued Operations

On July 27, 2006, the Company completed the sale of certain assets
and liabilities of its Lawnmower segment to Husqvarna.  The sale
resulted in preliminary gross proceeds of $33.9 million, which the
Company utilized to reduce long term debt to $374 million as of
July 27, 2006.  As a result of this sale, the Lawnmower segment
has been reclassified as a discontinued operation for all periods
presented.

In the second quarter, net loss from discontinued operations was
$0.9 million compared to net income of $1.4 million last year.
This year's net loss includes $1.5 million of after-tax expense
for employee termination costs.  In the third quarter of this
year, the Company estimates that it will record net income from
discontinued operations to reflect the gain on the sale of assets
and operating activity for the period of ownership.

                     Pension Plan Revisions

The Company has announced a pension plan redesign for existing
employees effective January 1, 2007.  Upon implementation, the
redesign will freeze benefits earned under the Company's defined
benefit plan and increase contributions paid to the Company's
401(k) defined contribution plan.  This redesign will result in
an estimated reduction to the Company's pension expense between
$16 million and $23 million over the next five years.  In the
second half of 2006, the Company will record a non-recurring
expense of approximately $3.7 million in conjunction with the
redesign.

A full-text copy of the Quarterly Report in Form 10-Q filed with
the Securities and Exchange Commission is available for free at
http://ResearchArchives.com/t/s?fdb

Blount International, Inc. (NYSE:BLT) -- http://www.blount.com/
-- is a diversified international company operating in three
principal business segments:  Outdoor Products, Industrial and
Power Equipment and Lawnmower.  Blount sells its products in
more than 100 countries around the world.  Blount has one of its
manufacturing locations in Curitiba, Brazil.

As of June 30, 2006, Blount International's equity deficit
narrowed to $122.81 million from a $145.18 million deficit at
Dec. 31, 2005.


BRICOLAGE CAPITAL: Has Until Sept. 15 to Decide on Lexington Lease
------------------------------------------------------------------
The Honorable James M. Peck of the U.S. Bankruptcy Court for the
Southern District of New York in Manhattan approved a fourth
stipulation between Bricolage Capital, LLC, and its landlord, 570
Lexington Company, L.P., to extend the Debtor's time to assume,
assume and assign, or reject its lease until Sept. 15, 2006.

Under the fourth agreement, the Debtor will remain current with
any and all postpetition obligations in accordance with the lease
and the requirements of Section 365(d)(4) of the Bankruptcy Code.

In the event the Debtor defaults on its lease obligations and the
default remains uncured pursuant to the terms of the lease, the
Landlord will have the right to draw down on the Debtor's
$1 million letter of credit with Citibank.

Headquartered in New York, New York, Bricolage Capital, LLC, filed
for chapter 11 protection on Oct. 14, 2005 (Bankr. S.D.N.Y.
Case No. 05-46914).  Robert E. Grossman, Esq., Lawrence J. Kotler,
Esq., and Matthew E. Hoffman, Esq., at Duane Morris LLP represent
the Debtor in its restructuring efforts.  No Official Committee of
Unsecured Creditors' has been appointed to date in Bricolage's
chapter 11 case.  When the Debtor filed for protection from its
creditors, it estimated assets of $1 million to $10 million and
debts of $10 million to $50 million.


CARDINAL COMMS: Get-A-Phone Unit Files for Chapter 11 Protection
----------------------------------------------------------------
Connect Paging, Inc., dba Get-A-Phone, a wholly owned subsidiary
of Cardinal Communications, Inc., petitioned for Chapter 11
bankruptcy protection on Aug. 11, 2006, in the U.S. Bankruptcy
Court for the Western District of Texas

Get-A-Phone has advised Cardinal, who owns 100% of Get-A-Phone's
stock, that Get-A-Phone has had difficulty making payments related
to billing adjustments by its telecommunications vendor.  Get-A-
Phone also advised Cardinal that it is attempting to work with the
vendor to negotiate a solution, which works for both companies,
but that it felt compelled to petition for reorganization under Ch
11 bankruptcy in order to maintain operations.

"We are disappointed that Get-A-Phone was unable to solve their
billing dispute and address their financial shortfall outside of
bankruptcy," Ed Garneau, Chief Executive Officer of Cardinal,
commented.  "Prior to the bankruptcy filing, we explored various
options in respect to Cardinal's investment in Get-A-Phone.  It is
unfortunate that our efforts were unsuccessful.  We will take all
steps necessary to protect and preserve our investment in Get-A-
Phone during the bankruptcy process."

                  About Cardinal Communications

Headquartered in Broomfield, Colorado, Cardinal Communications,
Inc., fka USURF America, Inc. (OTCBB: CDNC) provides full-service
solutions for residential and business applications including the
delivery of next-generation voice, video, and data broadband
networks to communities and cities throughout the United States;
the construction and development of luxury single and multi-family
homes, condominiums and apartment communities; home finance, real
estate and title services.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on May 15, 2006, AJ.
Robbins, PC, in Denver, Colorado, raised substantial doubt about
Cardinal Communications, Inc., fka USURF America, Inc.'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 recurring losses,
negative cash flows from operations, and working capital and
stockholders' equity deficiencies.


CARROLS CORP: Moody's Junks $180 Million Sr. Sub. Notes' Rating
---------------------------------------------------------------
Moody's Investors Service changed the ratings of Carrol's
Corporation:

Ratings downgraded:

   * Corporate family rating to B2 from B1

   * $180 million guaranteed senior subordinated notes due
     January 15, 2013, to Caa1 from B3

Ratings confirmed:

   * $220 million senior secured term loan B, due December 31,
     2010, rated B1

   * $50 million senior secured revolving credit facility due
     December 31, 2009, rated B1

Rating outlook is stable

This concludes Moody's review that was initiated on February 28,
2006.

The ratings downgrade was prompted by Carrol's weak credit metrics
with persistently high leverage, low interest coverage, and
marginal free cash flow generation, in addition to weak liquidity.
The B2 corporate family rating and stable outlook are supported by
Carrol's brand diversification, its position as the largest Burger
King franchisee, and the relatively good operating performance of
the Taco Cabana and Pollo Tropical brands which has resulted in
positive same store sales growth in aggregate.

Confirmation of the B1 senior secured bank loan ratings reflect
the benefit that accrues to these lenders from a secured interest
in all assets, including common stock, of Carrol's and all its
subsidiaries, in addition to guarantees from Carrol's and all
material subsidiaries.  The rating and notching above the
corporate family rating also reflect the support provided by
the substantial amount of senior subordinated notes in a
distressed scenario.

Conclusion of Moody's review also reflects the company's recent
success in filing its public financial statements with the SEC due
to the resolution of previous accounting concerns.  However,
Carrol's senior management continues to evaluate its disclosure
controls and procedures as ineffective as of April 2, 2006.

Carrol's Corporation, with headquarters in Syracuse, New York,
operates 336 Burger King quick service hamburger restaurants.
Carrol's also operates or franchises 95 Pollo Tropical restaurants
and 138 Taco Cabana restaurants.


CHARMING SHOPPES: Moody's Holds Ratings & Says Outlook is Positive
------------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Charming
Shoppes, Inc. to positive from stable which acknowledges the
company's continued improvement in profitability and credit
metrics as well as its successful completion of the integration of
the Crosstown Traders acquisition consummated last year.

These ratings are affirmed:

   * Corporate family rating at Ba3;
   * Senior unsecured convertible notes at B2.

The Ba3 corporate family rating and positive outlook is
supported by the company's profitability levels, size and scale,
seasonality, and financial policies, all which score at the Ba
rating level.  In addition, the company's improvement in
profitability has moved its leverage and coverage metrics to
levels appropriate for the Ba rating category from levels which
had previously supported a B rating category.

As calculated using Moody's standard analytical adjustments, for
the LTM period ended July 29, 2006, Debt improved to 5x from 5.9x
for fiscal year end 2004 and EBITA improved to 2.3x from 1.6x for
the same period.  In addition, the rating category reflects the
balance of the company's very high business risk as a specialty
apparel retailer, which is more reflective of a B rating category,
with its national footprint and market share, both
more reflective of an investment grade rating category.

The rating outlook is positive.  Ratings could be upgraded
should the company continue to improve its performance such
that, as calculated using Moody's standard analytical adjustments,
Debt falls below 4.25x and EBITA rises above 2.5x while
maintaining as reported operating margins and as adjusted retained
cash flow metrics at its current levels.  Given the positive
outlook, it is unlikely that ratings would be downgraded at the
present time; however, the outlook could be stabilized should the
company's performance deteriorate such that, as calculated using
Moody's standard analytical adjustments, Debt rises above 5.5x or
should its as reported operating margins deteriorate to below 5%.

Charming Shoppes, Inc., headquartered in Bensalem, Pennsylvania,
is a multi-channel, multi-brand specialty apparel retailer
primarily focused on plus-size women's apparel.  The company's
retail store segment operates 2,317 stores in 48 states and the
related E-commerce websites under the Lane Bryant, Fashion Bug,
and Catherines Plus Sizes brand names. Its direct-to-consumer
division operates numerous apparel, accessories, footwear,
and gift catalogs and related E-commerce websites through the
Crosstown Traders business which was acquired in June 2005.
For the LTM period ended July 29, 2006 revenues were approximately
$3.0 billion.


CHURCH & DWIGHT: Earns $36.4 Million in 2nd Quarter Ended June 30
-----------------------------------------------------------------
For the three months ended June 30, 2006, Church & Dwight Co. Inc.
reported net income of $36,406,000 from net sales of $458,584,000.

At June 30, 2006, the Company had total assets of $2,013,276,000,
total liabilities of $1,222,972,000 and total stockholders' equity
of $790,304,000.

A full-text copy of the Company's financial report for the three
months ended June 30, 2006 is available for free at:

               http://researcharchives.com/t/s?fd5

Headquartered in Princeton, New Jersey, Church & Dwight Co. Inc.
-- http://www.churchdwight.com/-- manufactures and sells sodium
bicarbonate products popularly known as baking soda.  The company
also makes laundry detergent, bathroom cleaners, cat litter,
carpet deodorizer, air fresheners, toothpaste, and
antiperspirants.

                          *     *     *

As reported in the Troubled Company Reporter on Jul. 31, 2006,
Standard & Poor's Ratings Services assigned its loan and recovery
ratings to Church & Dwight Co. Inc.'s $250 million senior secured
debt due 2012.  The loan was rated 'BB' with a recovery rating of
'2', indicating the expectation for substantial (80%-100%)
recovery of principal in the event of a payment default.

Standard & Poor's also lowered its ratings on the company's
existing senior secured bank debt and removed them from
CreditWatch.  The loan rating was lowered to 'BB' from 'BB+', and
the recovery rating was revised to '2' from '1'.  The corporate
credit rating on Church & Dwight was 'BB' and the rating outlook
was stable.


COLLINS & AIKMAN: Delays Form 10-Q and Form 10-K Filing
-------------------------------------------------------
Stacy Fox, executive vice president, chief administrative officer
and general counsel for Collins & Aikman Corp., reports in a
regulatory filing with the Securities and Exchange Commission
that the company is unable to file on time its Form 10-Q with
financial statements for the fiscal quarter ended June 30, 2006,
and Form 10-K with financial statements for the year ended
December 31, 2005.

Ms. Fox explains that the company's independent auditors, KPMG
LLP, are unable to complete their audit of the 2004 and 2005
financial statements and review of subsequent interim financial
statements because:

   (i) of the ongoing independent investigation of controls over
       financial reporting and review of certain accounting
       issues that are expected to require a restatement of
       certain previously reported periods; and

  (ii) the company filed for Chapter 11 bankruptcy.

Collins & Aikman also has not filed its Form 10-Q for the fiscal
quarters ended March 31, 2005, June 30, 2005, September 30, 2005,
and March 31, 2006, and Form 10-K for the fiscal year ended
December 31, 2004.

Collins & Aikman anticipates changes in its results of operations
based on the impact of the accounting issues, Ms. Fox says.  In
addition, and in light of its bankruptcy filing, the company also
anticipates that there will be a significant change in the
results of operations from the corresponding period for the prior
year, but is unable to currently assess the amount of the change
as a result of the ongoing restructuring process, according to
Ms. Fox.

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. 37; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


COLLINS & AIKMAN: 10-3/4% Bonds' Price Plummets to All-Time Low
---------------------------------------------------------------
Prices at which the 10-3/4% Senior Notes due 2011 issued by
Collins & Aikman Products Co. have fallen to all-time lows on
Aug. 11, 2006 -- trading dipped to 10 cents-on-the dollar.

Pricing data from Bloomberg shows trades occurred near these
prices since Collins & Aikman filed for Chapter 11 protection:

   Week Ending   Indicative Bond Pricing
   -----------   -----------------------
   11-Aug-2006   10.000 +++++
   04-Aug-2006   15.750 +++++++
   28-Jul-2006   21.000 ++++++++++
   14-Jul-2006   24.250 ++++++++++++
   07-Jul-2006   30.000 +++++++++++++++
   30-Jun-2006   30.688 +++++++++++++++
   23-Jun-2006   30.563 +++++++++++++++
   16-Jun-2006   30.500 +++++++++++++++
   09-Jun-2006   39.000 +++++++++++++++++++
   02-Jun-2006   45.000 ++++++++++++++++++++++
   26-May-2006   35.000 +++++++++++++++++
   19-May-2006   34.000 +++++++++++++++++
   12-May-2006   37.500 ++++++++++++++++++
   05-May-2006   35.500 +++++++++++++++++
   28-Apr-2006   33.000 ++++++++++++++++
   21-Apr-2006   33.000 ++++++++++++++++
   14-Apr-2006   31.250 +++++++++++++++
   07-Apr-2006   32.500 ++++++++++++++++
   31-Mar-2006   33.000 ++++++++++++++++
   24-Mar-2006   30.500 +++++++++++++++
   17-Mar-2006   32.500 ++++++++++++++++
   10-Mar-2006   30.500 +++++++++++++++
   03-Mar-2006   27.500 +++++++++++++
   24-Feb-2006   28.125 ++++++++++++++
   17-Feb-2006   30.000 +++++++++++++++
   10-Feb-2006   31.000 +++++++++++++++
   03-Feb-2006   29.500 ++++++++++++++
   27-Jan-2006   30.000 +++++++++++++++
   20-Jan-2006   33.500 ++++++++++++++++
   13-Jan-2006   39.000 +++++++++++++++++++
   06-Jan-2006   43.000 +++++++++++++++++++++
   30-Dec-2005   42.000 +++++++++++++++++++++
   23-Dec-2005   44.000 ++++++++++++++++++++++
   16-Dec-2005   42.250 +++++++++++++++++++++
   09-Dec-2005   42.000 +++++++++++++++++++++
   02-Dec-2005   43.500 +++++++++++++++++++++
   25-Nov-2005   44.330 ++++++++++++++++++++++
   18-Nov-2005   43.000 +++++++++++++++++++++
   11-Nov-2005   45.750 ++++++++++++++++++++++
   04-Nov-2005   49.038 ++++++++++++++++++++++++
   28-Oct-2005   47.000 +++++++++++++++++++++++
   21-Oct-2005   48.000 ++++++++++++++++++++++++
   14-Oct-2005   48.000 ++++++++++++++++++++++++
   07-Oct-2005   50.771 +++++++++++++++++++++++++
   30-Sep-2005   44.000 ++++++++++++++++++++++
   23-Sep-2005   42.375 +++++++++++++++++++++
   16-Sep-2005   41.500 ++++++++++++++++++++
   09-Sep-2005   40.000 ++++++++++++++++++++
   02-Sep-2005   36.000 ++++++++++++++++++
   26-Aug-2005   36.875 ++++++++++++++++++
   19-Aug-2005   36.250 ++++++++++++++++++
   12-Aug-2005   30.000 +++++++++++++++
   05-Aug-2005   29.688 ++++++++++++++
   29-Jul-2005   29.500 ++++++++++++++
   22-Jul-2005   27.000 +++++++++++++
   15-Jul-2005   29.500 ++++++++++++++
   08-Jul-2005   29.625 ++++++++++++++
   24-Jun-2005   28.875 ++++++++++++++
   17-Jun-2005   41.000 ++++++++++++++++++++
   10-Jun-2005   39.500 +++++++++++++++++++
   03-Jun-2005   43.500 +++++++++++++++++++++
   27-May-2005   41.000 ++++++++++++++++++++
   20-May-2005   40.000 ++++++++++++++++++++
   13-May-2005   47.250 +++++++++++++++++++++++
   06-May-2005   71.000 +++++++++++++++++++++++++++++++++++

At the close of trading on August 14, prices of the 10-3/4%
Senior Notes slightly increased to 11 cents-on-the-dollar.

The 10-3/4% Senior Notes were issued in an Exchange Offer in June
2002.  A full-text copy of the Prospectus circulated in connection
with the $500 million Exchange Offer is available at no charge
at http://researcharchives.com/t/s?fd6

In his letter to shareholders for the fiscal quarter ending
April 30, 2005, Martin J. Whitman, Co-Chief Investment Officer &
Portfolio Manager of Third Avenue Value Fund, disclosed that the
Fund started to aggressively acquire Collins and Aikman's 10-3/4%
Senior Notes following the company's chapter 11 filing.  "At the
time of this writing, Third Avenue holds $250,750,000 Principal
Amount of Collins and Aikman Seniors, or slightly over half of
the outstanding issue," Mr. Whitman indicated, making Third
Avenue the largest holder of the Senior Notes.

For the five years and nine months through September 2004, Mr.
Whitman told the Fund's shareholders, Collins and Aikman's annual
operating income before non-recurring charges ranged from a low
of $61,500,000 in 2001 to a high of $224,600,000 in 2002.  Annual
interest charges for the Collins and Aikman Seniors together with
the Collins and Aikman Subordinates total $107,000,000 per year.
In Chapter 11, Mr. Whitman indicated, these $107,000,000 of cash
costs are eliminated, offset in part by professional costs in
Chapter 11 should range from about $4 million to $6 million per
month.

Mr. Whitman was hopeful that Collins & Aikman could be
reorganized in Chapter 11 relatively quickly, perhaps in as
little as 180 days.  Mr. Whitman envisioned a plan of
reorganization that would reinstate secured debt, deliver 90% of
the new common stock to holders of Senior Debt, give 10% of the
new common stock to subordinated debtholders, wipe out the
existing shareholders, and provide management with options for 5%
of the new common stock.

"If future annual operating income is to average, say,
$150,000,000 then the Fund would have acquired its position in
the new Collins and Aikman Common Stock at probably less than
five times earnings.  If Collins and Aikman can get annual
operating income up to $200,000,000, the PE ratio for TAVF would
decline to around three times," Mr. Whitman told shareholders in
early 2005.

Mr. Whitman pointed out two "very real risks" in the Collins &
Aikman investment to Third Avenue shareholders:

   (1) Reorganization Risk.  If TAVF and other creditors
       can not relatively quickly reorganize Collins and
       Aikman along the lines outlined above, and a
       protracted Chapter 11 ensues, the bulk of the values
       in Collins and Aikman probably will belong to the
       professionals -- lawyers and investment bankers --
       not to pre-petition creditors.  Unknowns, such as a
       need to renegotiate labor contracts, could prolong
       the Chapter 11 proceeding, even if the Company, itself,
       is cooperating with TAVF and other holders of Collins
       and Aikman Seniors.  Old Collins and Aikman Common
       would be wiped out in any event.

   (2) Business Risk.  Maybe operating income for this
       automotive supplier will never again approach the
       average levels of the past six years.  75% of Collins
       and Aikman revenues come from the "Big Three"
       automobile manufacturers who have been losing
       market penetration.  Also, much of the company's
       raw materials costs are in resins where prices are
       correlated to the price of oil.  A persistent margin
       squeeze may be a fact of life.

David Barse, as a TAVF representative, chairs the Official
Committee of Unsecured Creditors in Collins & Aikman's chapter 11
cases.

"Collins and Aikman is a considerably more troubled debtor than
we had assumed based on Pre-Chapter 11 public filings," Mr.
Whitman indicated in another letter to Third Avenue shareholders
in 2005.  "The situation may be difficult to work out, but I
think the odds favor Third Avenue becoming the dominant common
shareholder in a reorganized, and feasible, Collins and Aikman.
There are, of course, no guaranties.  In our long history of
investing in distressed debt, our most successful investments
were full of Collins and Aikman type unpleasant surprises that
arose immediately subsequent to Chapter 11 filings. The eventual
workouts, though, were spectacular for Nabors Industries,
Danielson Holding Corporation and Kmart."

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. 37; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


COMPLETE RETREATS: Selects XRoads Case Management as Claims Agent
-----------------------------------------------------------------
Complete Retreats LLC and its debtor-affiliates ask permission
from the U.S. Bankruptcy Court for the District of Connecticut to
XRoads Case Management Services, LLC, as their claims and noticing
agent.

The Debtors inform the Court that they have more than 5,000
creditors and other potential parties-in-interest.  The Debtors
believe that the Office of the Clerk of the Court is not equipped
to:

   (i) distribute notices;

  (ii) process all proofs of claim filed in the Chapter 11 cases;
       and

(iii) assist in the balloting process.

As the Debtors' claims and noticing agent, XCM will:

   (a) assist the Debtors and their counsel in the preparation of
       the Debtors' schedules of assets and liabilities and
       statements of financial affairs;

   (b) assist the Debtors and their counsel in the preparation of
       the initial reporting package for the United States
       Trustee;

   (c) assist the Debtors and their counsel in preparation of the
       Debtors' monthly operating reports;

   (d) design, maintain, and administer the Debtors' claims
       database;

   (e) provide designated users with access to the claims
       database to track claims activity, to view claims-related
       documents in PDF format, and to create reports;

   (f) send out acknowledgement cards to creditors confirming
       receipt of their proofs of claim; and

   (g) provide copy and notice service consistent with the
       applicable local rules and as asked by the Debtors or the
       Court, including acting as the official claims agent in
       lieu of the Court in:

       (1) serving notice to parties-in-interest;

       (2) maintaining all proofs of claim and proofs of interest
           filed and received in the bankruptcy cases;

       (3) docketing the claims;

       (4) maintaining and transmitting to the clerk of the Court
           the official claims registers;

       (5) maintaining current mailing lists of all entities that
           have filed claims and notices of appearance it
           receives;

       (6) providing public access for examination of the claims
           at CMS' premises during regular business hours and
           without charge; and

       (7) recording assignments of claims to third parties and
           recording all transfers received by CMS pursuant to
           Rule 3001(e) of the Federal Rules of Bankruptcy
           Procedure.

On the Debtors' behalf, James Mitchell tells the Court that XCM
was chosen because of its experience, the competitiveness of its
fees, and its prepetition involvement with the Debtors.  XCM has
provided necessary assistance to the Debtors in preparing for
their bankruptcy filings.

The Debtors will pay XCM these hourly rates for its consulting
services:

   Professional                           Hourly Rate
   ------------                           -----------
   Director or Managing Director         $225 to $325
   Consultant or Sr. Consultant          $125 to $225

   Type of Service                        Hourly Rate
   ---------------                        -----------
   Accounting and Document Management    $125 to $195
   Programming and Technical Support     $125 to $195
   Clerical - data entry                 $40 to $65

John Vander Hooven, a managing director at XRoads Case Management
Services, LLC, assures the Court that the firm neither holds nor
represents any interest adverse to the Debtors' estates on
matters for which it is to be retained and employed.  XCM has had
no prior connection with the Debtors, however, XCM's employees
may, in the ordinary course of their personal affairs, have
relationships with certain creditors of the Debtors, Mr. Hooven
adds.

XCM is a "disinterested person", as referenced in Section 327(a)
of the Bankruptcy Code and as defined in Sections 101(14) and
1107(b) of the Bankruptcy Code, Mr. Hooven maintains.

                     About Complete Retreats

Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses.  In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.  Complete Retreats and its debtor-
affiliates filed for chapter 11 protection on July 23, 2006
(Bankr. D. Conn. Case No. 06-50245).  Nicholas H. Mancuso, Esq.
and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors in
their restructuring efforts.  Michael J. Reilly, Esq., at Bingham
McCutchen LP, in Hartford, Connecticut, serves as counsel to the
Official Committee of Unsecured Creditors.  No estimated assets
have been listed in the Debtors' schedules, however, the Debtors
disclosed $308,000,000 in total debts.  (Complete Retreats
Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


COMPLETE RETREATS: Court Denies Intagio's Reservations Request
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut denied
Intagio Corporation's request to:

   (a) direct Complete Retreats LLC and its debtor-affiliates to
       honor all THR Credit Reservations made, or to be made,
       under the 2005 Contract and any of the Prior Contracts;
       and

   (b) exempt the THR Credit Reservations, if necessary, from the
       provisions of the Reservations Order to the extent any of
       them apply to the THR Credit Reservations.

The Court found that Intagio failed to comply with the contested
matter procedure guidelines effective Oct. 3, 2005.

The Troubled Company Reporter on Aug. 8, 2006 stated that in
October 2005, Debtor Preferred Retreats LLC dba Tanner & Haley
Destination Clubs, and Intagio entered into a Media Purchase
Agreement, whereby Intagio agreed to place an advertising campaign
on behalf of Preferred Retreats.

In return, Preferred Retreats agreed to provide Intagio:

   -- a $647,045 cash payment for advertising; and

   -- credits, totaling $327,975, redeemable for occupancy rights
      at all THR Private Retreats, THR Distinctive Retreats, THR
      Distinctive Retreats II and THR Legendary Retreats
      properties.

Intagio and Preferred Retreats were also parties to prior
agreements of a similar nature, Louis J. Testa, Esq., at Neubert,
Pepe & Monteith, P.C., in New Haven, Connecticut, said.

Prior to the Debtors' bankruptcy filing, Intagio booked certain
reservations on behalf of its clients and resold some of the THR
Credits to third parties under the 2005 Contract and the Prior
Contracts, Mr. Testa disclosed.

As of July 23, 2006, these THR Credit Reservations were
outstanding:

   (1) Reservations already booked through Intagio's travel
       department, on behalf of Intagio's clients;

   (2) THR Credits resold by Intagio to third parties for which
       reservations have been, or may be made, by the parties;
       and

   (3) THR Credits owned by Intagio but not yet sold to third
       parties or redeemed for Client Reservations.

On July 27, 2006, the Court authorized the Debtors to honor
existing reservations, accept new reservations and provide
services to members under certain terms and conditions.

Subsequent to July 23, 200, Intagio received formal
notification from the Debtors that they will not honor the THR
Credit Reservations.

Mr. Testa noted that Intagio is particularly concerned with a
client reservation made by Michael Cunningham in February 2006
for the Debtors' location at Palm Beach County, in Florida, for
occupancy commencing on August 16, 2006, and ending on August 21,
2006.

The remaining Client Reservations will commence on Oct. 2,
Oct. 19 and Dec. 8, 2006, Mr. Testa added.

If the Debtors fail to honor the Client Reservations and the
Third Party Reservations, Intagio will be required and compelled
to reimburse at least $456,282 to the reservation holders in cash
or business credits, Mr. Testa informed the Honorable Alan H.W.
Shiff.

It is unlikely that Intagio will recover the amount of the
Reservation Obligations in the bankruptcy cases, Mr. Testa said.
Unlike Intagio, however, the Debtors will not suffer significant
hardship or irreparable injury by being compelled to honor the
THR Credit Reservations pending confirmation of a plan of
reorganization, Mr. Testa continued.

According to Mr. Testa, a review of the Reservations Motion and
Reservations Order appears to indicate that the relief requested
is limited to reservations made by members only, and not third
party creditors like Intagio.  Nor does the order appear to apply
to the holders of Client Reservations and Third Party
Reservations.

The Reservations Order allows the Debtors to provide preferential
treatment for a group of unsecured creditors, namely members, to
the detriment of other unsecured creditors, like Intagio, and
differentiate their treatment with respect to honoring of
reservations, Mr. Testa asserted.

Moreover, Intagio was not placed upon prior notice of the
Reservations Motion in order to protect its interests with
respect to the THR Credit Reservations.

"[Thus,] the balance of the equities weigh in favor of Intagio,"
Mr. Testa maintained.

Mr. Cunningham will need to be informed as soon as practically
possible prior to August 16, 2006, of the need to make alternate
vacation plans, if necessary, Mr. Testa told the Court.  In
addition, the holders of the remaining Client Reservations will
need as much time as possible to make alternative plans, if
necessary.

                     About Complete Retreats

Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses.  In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.  Complete Retreats and its debtor-
affiliates filed for chapter 11 protection on July 23, 2006
(Bankr. D. Conn. Case No. 06-50245).  Nicholas H. Mancuso, Esq.
and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors in
their restructuring efforts.  Michael J. Reilly, Esq., at Bingham
McCutchen LP, in Hartford, Connecticut, serves as counsel to the
Official Committee of Unsecured Creditors.  No estimated assets
have been listed in the Debtors' schedules, however, the Debtors
disclosed $308,000,000 in total debts.  (Complete Retreats
Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


CONSTELLATION BRANDS: Inks Pact to Sell $700 Mil. of 7.25% Notes
----------------------------------------------------------------
Constellation Brands, Inc. and certain subsidiary guarantors
entered into an underwriting agreement with Citigroup Global
Markets Inc., J.P. Morgan Securities Inc., Scotia Capital (USA)
Inc. and Banc of America Securities LLC for the sale by the
Company of $700 million in aggregate principal amount, of 7.25%
Senior Notes due 2016.

The Company disclosed that the public offering price is 99.02% of
the principal amount of the Notes.  The offering is being made by
a prospectus dated August 8, 2006 included in the Company's shelf
registration statement on Form S-3, together with a prospectus
supplement dated August 10, 2006 and filed with the SEC on August
11, 2006.  The Underwriters will purchase the Notes from the
Company at 98.02% of their principal amount.

The Company also disclosed that, the Notes will be issued under a
Supplemental Indenture No. 1 entered into among the Company, the
Guarantors and BNY Midwest Trust Company, as trustee.

The Company further disclosed that, the underwriters and their
affiliates have performed and may perform various investment
banking, commercial banking and advisory services for the Company
for which they have received or will receive customary fees and
expenses.  In particular, affiliates of certain of the
underwriters are lenders under the Company's Credit Agreement,
dated as of June 5, 2006, borrowings under which will be reduced
with the net proceeds of the offering.  The aggregate amount of
debt owed to the underwriters and their affiliates to be repaid
with the proceeds from the offering constitutes less than 10% of
the proceeds of the offering.

Constellation Brands, Inc. (NYSE:STZ, ASX:CBR),
-- http://www.cbrands.com/-- is an international producer and
marketer of beverage alcohol brands with a broad portfolio across
the wine, spirits and imported beer categories.  Well-known brands
in Constellation's portfolio include: Almaden, Arbor Mist,
Vendange, Woodbridge by Robert Mondavi, Hardys, Goundrey, Nobilo,
Kim Crawford, Alice White, Ruffino, Kumala, Robert Mondavi Private
Selection, Rex Goliath, Toasted Head, Blackstone, Ravenswood,
Estancia, Franciscan Oakville Estate, Inniskillin, Jackson-Triggs,
Simi, Robert Mondavi Winery, Stowells, Blackthorn, Black Velvet,
Mr. Boston, Fleischmann's, Paul Masson Grande Amber Brandy, Chi-
Chi's, 99 Schnapps, Ridgemont Reserve 1792, Effen Vodka, Corona
Extra, Corona Light, Pacifico, Modelo Especial, Negra Modelo, St.
Pauli Girl, Tsingtao.


CONSTELLATION BRANDS: Fitch Affirms Low-B Ratings
-------------------------------------------------
Constellation Brands, Inc. (NYSE:STZ) sold $700 million of new 10-
year senior notes (new notes) on August 10, 2006.  The 7.250% new
notes were priced at a spread of 245 basis points over treasury to
yield 7.389%.  The net proceeds are expected to be used to repay
bank debt.  Upon this new notes issuance, Fitch has affirmed the
existing ratings of STZ as:

    -- Issuer Default Rating (IDR) 'BB';
    -- Bank credit facilities 'BB';
    -- Senior unsecured notes 'BB';
    -- Senior subordinated notes 'BB-'.

The new notes lack typical high yield covenants such as debt
incurrence and restricted payment tests.  From Fitch's
perspective, the new notes reduce refinancing risk during the next
10 years and enhance STZ's already adequate financial flexibility.
Although the terms of the new notes are not as restrictive as its
existing senior notes, Fitch's 'BB' rating for the new notes
reflects STZ's improving credit profile.

STZ's contract as an importer for Grupo Modelo S.A. de C.V's
beers, including Corona, for the western U.S. was up for renewal
at the end of 2006.  On July 17, 2006, STZ announced a joint
venture with Grupo Modelo to be consummated on or after Jan. 2,
2007, according to which Grupo Modelo's Mexican beer portfolio
will be imported and sold by the joint venture in the entire U.S.,
including D.C. and Guam.  The joint venture may also sell Tsingtao
and St. Pauli Girl brands.  Fitch believes that the removal of
uncertainty regarding renewal of its original contract comprising
the western U.S. with Grupo Modelo is credit positive, as is the
expanded coverage to the entire U.S. through the joint venture.

STZ's ratings reflect its leading market position and broad
portfolio of wine, beer and spirits in diversified global markets.
STZ has pursued a strategy of growth through acquisitions financed
primarily with debt.  Recent acquisitions include BRL Hardy Ltd.
for $1.4 billion in 2003, Robert Mondavi Corp. for $1.355 billion
in 2004, and Vincor International Inc. for $1.4 billion in June
2006.  The company has an excellent track record of integrating
acquisitions.  It has applied cash flow to support capital
expenditures and debt paydown.  STZ has generated significant free
cash flow in each of the past three years.  Operating EBITDA for
the last 12 months, as of May 31, 2006 and pro forma for the
Vincor acquisition, was over $900 million.

Pro forma for the Vincor acquisition, repayment of recently
matured senior notes, and new notes issuance, STZ's leverage
defined as total debt-to-operating EBITDA was 4.6 times (x), while
interest coverage was 3.2x, for the LTM ended May 31, 2006.  It
should be noted that STZ has five-year interest rate swap
agreements on $1.2 billion of its floating-rate bank debt that
fixes LIBOR at an average rate of 4.1% through fiscal 2010.  STZ
maintains adequate liquidity through a $500 million revolver,
which is expected to have no outstanding balance upon application
of net proceeds from the new notes issuance.


COPELANDS' ENTERPRISES: Names Barry Soosman as New CEO
------------------------------------------------------
Copeland Sports reported ownership and management changes, along
with a new financing agreement, in conjunction with the filing of
a voluntary petition for relief under Chapter 11 of the U.S.
Bankruptcy Code.  The company operates 31 Copeland Sports stores
in California, Oregon, Nevada and Utah.  Tom and Jim Copeland of
San Luis Obispo, who managed the company for over 30 years before
the purchase of the company in 2002 by a private equity firm,
founded it in 1971.

Tom, Jim and Mike Copeland have just reacquired ownership of the
company, and will resume an active management role.  Copeland
Sports has also named a new chief executive officer, Barry
Soosman, who was formerly an executive vice-president of Guitar
Center, Inc., with expertise in specialty retailing.

Copeland Sports filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code on Aug. 14, 2006, in
Wilmington, Delaware.  At the same time, Copeland Sports announced
that it had reached agreement with Wells Fargo Retail Finance, LLC
on a $25 million debtor-in-possession credit facility.  The
Copeland family will make an additional secured loan to the
company of $5 million, to pay down the Wells Fargo secured claim
and increase borrowing availability under the credit facility.
Copeland Sports believes that the credit facility, along with
funds generated by operations, is sufficient to meet its capital
requirements.

Chapter 11 allows a company to continue operating its business
while it restructures.  Copeland Sports intends to immediately
close several stores that are underperforming or are situated in
overlapping markets, to focus on its profitable core operations.
"We believe that with the right approach and our knowledge of the
company and the sporting goods industry, we can put the company
back on a sound footing and come out of Chapter 11 quickly," said
Tom Copeland.

In addition to lending the company $5 million, the Copeland family
has agreed to voluntarily subordinate their lien rights as holders
of over $13 million in Senior Subordinated Notes, for the benefit
of vendors who agree to supply goods and services to Copeland
Sports on ordinary credit terms.  This commitment is intended to
encourage suppliers to help restock Copeland Sports for the back-
to-school and upcoming holiday seasons.

"Copeland Sports has always enjoyed strong relationships with our
suppliers, and want to make sure they know they can continue to do
business with the company," Mr. Copeland said.  "We built this
business, and we intend to do everything possible to keep the
confidence of our customers and creditors."

                 About Copelands' Enterprises

Based in San Luis Obispo, California, Copelands' Enterprises,
Inc., dba Copelands' Sports -- http://www.copelandsports.com/--  
operates specialty sporting goods stores.  The Company filed for
chapter 11 protection on Aug. 14, 2006 (Bankr. D. Del. Case No.
06-10853).  Laura Davis Jones, Esq., Marc A. Berlinson, Esq., and
Ira A. Kharasch, Esq., at Pachulski, Stang, Ziehl, Young, Jones, &
Weintraub, in Los Angeles, California, represent the Debtor.
Clear Thinking Group serves as the Debtor's financial advisor.
When the Debtor filed for protection from its creditors, it
estimated assets and debts between $50 million and $100 million.


DANA CORP: Dana Credit Reports $47-Mil. Tax Sharing Receivable
--------------------------------------------------------------
As of June 30, 2006, Dana Credit Corporation has recorded
approximately $47,000,000 as a net tax sharing receivable from
Dana Corporation, Michael L. DeBacker, vice president, general
counsel and secretary of Dana, discloses in a regulatory filing
with the Securities and Exchange Commission.

Dana and DCC file a consolidated federal tax return and file
consolidated or combined state tax returns were allowable, Mr.
DeBacker relates.  Tax benefits and liabilities between Dana and
DCC are computed under an intercompany tax sharing agreement.

Under the Tax Sharing Agreement, each year DCC recognizes tax
benefits and liabilities for estimated taxes refundable from or
payable to Dana using a method known as "benefits for loss
companies".  Under the method:

   (i) income tax benefits attributable to DCC based on its
       current year net taxable loss are recognized by Dana as an
       amount payable to DCC and by DCC as an amount receivable
       from Dana; and

  (ii) income tax liabilities attributable to DCC based on its
       current year net taxable income are recognized by Dana as
       an amount payable from DCC and by DCC as an amount payable
       to Dana.

To the extent any tax amounts determined by Dana and DCC pursuant
to the Tax Sharing Agreement are subsequently adjusted as a
result of audits by relevant tax authorities or adjusted by the
filing of amended tax returns, the previously recorded amounts
payable and receivable are adjusted by Dana and DCC at the time
as the tax audit adjustments are agreed to and determined to be
probable by Dana.

Dana has previously reported DCC's plans to market and sell is
portfolio assets and during the past several years, DCC has
completed several asset sales.  As of August 1, 2006, DCC had
approximately $50,000,000 cash on hand from previous asset sales
and operations, Mr. DeBacker reports.

DCC believes that the marketing and sale of its portfolio of
remaining assets could generate aggregate sale proceeds of
approximately $200,000,000 to $300,000,000.  Accordingly, the
continued sale of DCC's assets is expected to generate additional
tax liabilities, totaling approximately $80,000,000 to
$115,000,000, owed to Dana under their Tax Sharing Agreement.

Dana and DCC have amended their Tax Sharing Agreement from time
to time.  Among other things, the amendments have eliminated
DCC's liability to pay Dana for capital gains DCC generated in
the years 2002 through 2004 in connection with the sale of DCC
investments.

A full-text copy of the Modified Tax Sharing Agreement is
available for free at http://ResearchArchives.com/t/s?f82

The $47,000,000 Tax Receivable includes certain assessments in
connection with tax audit adjustment settlements that have been
agreed to by Dana, DCC and the Internal Revenue Service,
according to Mr. DeBacker.  However, the amount does not reflect
matters subject to current tax audits by the IRS because the
outcome of the audits has not yet been determined to be probable
by Dana.

                        Current Tax Audits

According to Mr. DeBacker, the IRS is currently examining certain
stock sale transactions that DCC completed during the years 2002
through 2004.  DCC did not recognize any tax liability for
approximately $640,000,000 capital gain on stock sales
transactions in 2002 through 2004 because DCC utilized Dana's
capital loss carryforward as an offset.

Furthermore, pursuant to the modified Tax Sharing Agreement, DCC
incurred no obligation to Dana to the extent the stock sale
transactions arose with respect to capital gains, Mr. DeBacker
says.  Dana believes that the stock sale transactions were
completed in accordance with appropriate tax regulations and that
the likelihood of an adverse outcome is remote.

However, if the IRS determines that gains from the stock sales
transactions were not capital in nature, then DCC's gains on the
transactions would be re-characterized as ordinary gains, and DCC
would not be able to avail of any benefit associated with Dana's
capital loss carryforward.

If the entire $640,000,000 was re-characterized as ordinary gain,
and assuming a 35% tax rate, the Tax Sharing Agreement would
provide for an additional DCC liability to Dana of approximately
$224,000,000, Mr. DeBacker says.

                      About Dana Corporation

Toledo, OH-based Dana Corp. -- http://www.dana.com/-- designs and
manufactures products for every major vehicle producer in the
world, and supplies drivetrain, chassis, structural, and engine
technologies to those companies.  Dana employs 46,000 people in 28
countries.  Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.  The
company and its affiliates filed for chapter 11 protection on Mar.
3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  Corinne Ball, Esq.,
and Richard H. Engman, Esq., at Jones Day, in Manhattan and
Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black,
Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio,
represent the Debtors.  Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor and investment
banker.  Ted Stenger from AlixPartners serves as Dana's Chief
Restructuring Officer.  Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel LLP, represents the Official Committee of
Unsecured Creditors.  When the Debtors filed for protection from
their creditors, they listed $7.9 billion in assets and $6.8
billion in liabilities as of Sept. 30, 2005.  (Dana Corporation
Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

The Debtors' consolidated balance sheet at March 31, 2006, showed
a $456,000,000 total shareholder' equity resulting from total
assets of $7,788,000,000 and total liabilities of $7,332,000,000.


DANA CORP: Invests $7.6 Million for St. Clair Plant Upgrades
------------------------------------------------------------
Dana Corporation will invest $7.6 million to upgrade its thermal
products manufacturing plant in the Christian B. Haas Industrial
Park in St. Clair.  This investment, which includes $6 million in
advanced new equipment and $1.6 million to add 28,000 square feet,
is expected to result in the creation of 130 new jobs.

"Dana has been a job-provider for St. Clair families for
decades, and the company's decision to invest in Michigan is a
testament to our top-rate workforce," Governor Jennifer M.
Granholm said.  "This expansion will create the high-tech jobs
that will make Michigan's manufacturing sector competitive in
today's global economy."

Recently amended legislation allows companies such as Dana
to receive a refundable 15 percent Single Business Tax credit for
taxes paid on industrial personal property for four years.  The
goal of this credit is to encourage investment and upgrades in
Michigan facilities.  The new law enables the Michigan Economic
Development Corporation to offer Dana an SBT credit valued at
$22,000 to help secure the company's investment.  Based on the
estimated investment of $6 million in new equipment, an additional
SBT credit of up to $65,000 could be available in
2007.

State sales tax exemptions on manufacturing equipment make the
company eligible for tax savings of $360,000.  In addition, the
state investment tax credit can be applied on the investment
of $7.6 million up to a value of $53,000.

"Thanks to the technological leadership of companies like Dana,
Michigan is known worldwide for its highly productive workers,"
MEDC President and CEO James C. Epolito said.  "This huge
investment in upgraded technology enhances their competitiveness
and solidifies Michigan's position as the global center for
manufacturing R&D and innovation."

The package of incentives coordinated by the MEDC, the Economic
Development Alliance of St. Clair County and the city of St. Clair
is worth up to $1,362,000.

Steven Monte, Division Manager of Dana's Thermal Product
group, said, "Our expansion in St. Clair is off to a great start
thanks to the support of county and state officials.  This
addition will strengthen Dana's ability to manufacture advanced
Long(R) thermal-management products for vehicle makers around the
world."

The city of St. Clair is considering local tax abatement worth up
to $692,000 over 12 years to support the project.  Additionally,
the project qualifies for state education tax abatement worth up
to $170,000.

Doug Alexander, executive director of the Economic Development
Alliance of St. Clair County said, "We are very pleased that
through a cooperative effort with the City of St. Clair and MEDC,
we were able to convince Dana to expand in St. Clair over
alternative locations it was considering.  This is certainly good
news for our community."

In her 2006 State of the State address, Granholm emphasized the
importance of making Michigan a global economic powerhouse in the
21st century.  Since January 2005, the Governor and the MEDC have
announced the creation or retention of more than 90,000 jobs as a
result of targeted assistance provided by the MEDC.

The Michigan Economic Development Corporation, a partnership
between the state and local communities, promotes smart economic
growth by developing strategies and providing services to create
and retain good jobs and a high quality of life.  For more
information on the Michigan Economic Development Corporation's
initiatives and programs, visit the Web site at
http://www.michigan.org/

                      About Dana Corporation

Toledo, OH-based Dana Corp. -- http://www.dana.com/-- designs and
manufactures products for every major vehicle producer in the
world, and supplies drivetrain, chassis, structural, and engine
technologies to those companies.  Dana employs 46,000 people in 28
countries.  Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.  The
company and its affiliates filed for chapter 11 protection on Mar.
3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  Corinne Ball, Esq.,
and Richard H. Engman, Esq., at Jones Day, in Manhattan and
Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black,
Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio,
represent the Debtors.  Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor and investment
banker.  Ted Stenger from AlixPartners serves as Dana's Chief
Restructuring Officer.  Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel LLP, represents the Official Committee of
Unsecured Creditors.  When the Debtors filed for protection from
their creditors, they listed $7.9 billion in assets and $6.8
billion in liabilities as of Sept. 30, 2005.  (Dana Corporation
Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

The Debtors' consolidated balance sheet at March 31, 2006, showed
a $456,000,000 total shareholder' equity resulting from total
assets of $7,788,000,000 and total liabilities of $7,332,000,000.


DELPHI CORPORATION: Methode Asserts Set-Off Rights Over Rebates
---------------------------------------------------------------
Methode Electronics, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York to lift the automatic stay to allow
it to exercise set-off or recoupment rights with respect to
certain Secured Claim against Rebates, Cash in Advance Balance,
and Overpayments.

Methode Electronics, Inc., currently supplies the Debtors with
passive occupant detection systems and other electrical components
pursuant to a contract dated Aug. 1, 2001.

On Oct. 3, 2005, Methode and the Debtors entered into an agreement
pursuant to which Delphi Corp. agreed to pay Methode for products
on "Cash in Advance" terms with a 1% unit price discount.

Delphi wired a $3,053,807 payment to Methode the next day as an
initial advance payment for payments for the subsequent seven-day
period.  Between Oct. 4 and Oct. 8, 2005, Methode drew on the Cash
in Advance Payment in amounts sufficient to cover each day's
shipments to Delphi.

When the Debtors filed for bankruptcy, the remaining balance of
the Cash in Advance Payment held by Methode was $1,923,985.

Methode and Delphi entered into a postpetition agreement pursuant
to which Delphi agreed to pay Methode on "net immediate terms" for
postpetition shipments.  Under these new terms, Methode would
receive payment five to seven days after Delphi's receipt of
shipments.

From and after the Debtors' bankruptcy filing, Methode has
continued to ship PODS and other electrical components to Delphi
without interruption, and Delphi has paid for those shipments
pursuant to the Postpetition Agreement.

On May 3, 2006, Methode filed a $2,939,137 secured claim against
the Debtors.

Methode believes that the Secured Claim is secured by its rights
of set-off:

   -- It holds the Cash in Advance Balance and a $765,152 in
      prepetition overpayments; and

   -- It owes Delphi $250,000 in prepetition rebates.

Delphi has informed Methode of its intention to debit Methode's
postpetition account -- that is, to withhold payments otherwise
due for postpetition shipments under the Contract -- for
$1,834,934, which Delphi asserts to be the remaining balance of
the Cash in Advance Payment.

Based in Troy, Mich., 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. 36; Bankruptcy
Creditors' Service, Inc., 215/945-7000,
http://bankrupt.com/newsstand/)


DELTA AIR: Teamsters and Comair to Resume Talks on Aug. 23 and 24
-----------------------------------------------------------------
Comair Airlines flight attendants are scheduled to negotiate with
the company on August 23 and 24 to pursue a consensual agreement.
However, flight attendants are preparing for job actions if
negotiations fail and Comair chooses to unilaterally implement its
proposal.

The flight attendants, who voted 93% in favor of authorizing job
actions, will be free to respond with self-help actions should the
company choose to implement its demand for concessions.

The Cincinnati-based Comair filed for bankruptcy protection, along
with Delta last year, and has sought $8.9 million in cuts from the
flight attendants.

The executive board of Teamsters Local 513 passed a resolution in
early March that laid the foundation for possible strike actions
by 1,000 Comair flight attendants.  Local 513 Executive Board
members unanimously passed the resolution, condemning the
company's unreasonable concession demands.

"We have already proven that we are dedicated to keep this airline
flying," said Connie Slayback, Local 513 President in Florence,
Kentucky.  "But if Comair chooses unilateral action instead of a
consensual agreement, then our members will decide how to take
action.  Travelers should be aware that strike activity is
possible and would disrupt operations at both Comair and Delta."

Founded in 1903, the Teamsters Union represents more than 1.4
million hardworking men and women in the United States and Canada.

                        About Delta Air

Headquartered in Atlanta, Georgia, Delta Air Lines (OTC:DALRQ) --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice.  Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice.  John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors.  As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities.


DIAGNOSTIC IMAGING: S&P Downgrades Corporate Credit Rating to B
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Diagnostic Imaging Group LLC to 'B' from 'B+'.  The
rating outlook is stable.

"The rating downgrade reflects a greater-than-anticipated level of
acquisition activity and weaker-than-anticipated financial
performance," said Standard & Poor's credit analyst Cheryl Richer.

"Despite a modest uptick in debt protection ratios in the second
quarter due to solid organic growth, facility start-up delays and
the postponement of debt paydown due to a diversion of cash to
fund acquisitions have set the company meaningfully behind
expected performance."

The low speculative-grade rating on Diagnostic Imaging Group
reflects:

   * the company's relatively small presence in the competitive
     medical imaging field;

   * geographic concentration;

   * reimbursement risk; and

   * high lease-adjusted financial leverage.

These factors overshadow favorable demand prospects related to an
aging population and to the benefits of imaging itself, as well
as Diagnostic Imaging's solid payor relationships and strong
organic growth.  Evercore Capital Partners owns 64% of the
company, and a 36% stake remains in the hands of the former
owners, who continue their operational oversight of the business.

Hicksville, New York-based Diagnostic Imaging operates facilities,
equipment, and certain administrative services pursuant to a
40-year management services agreement with Doshi Diagnostic
Imaging Services P.C., a provider of diagnostic imaging services
in 16 centers in the metropolitan New York area.

Diagnostic Imaging also operates 18 diagnostic imaging centers in
northern, southern, and western Florida, as well as four in New
Jersey.  The total of 38 facilities is a steep increase from 24 a
little more than a year ago, and some new center openings did not
proceed as quickly as anticipated; several delayed openings
resulted in a drag on earnings.

Although the company's strong presence in the New York City area
provides benefits, such as joint management of operations and
throughput, as well as enhanced payor relationships, it represents
significant geographic concentration.  New York contributes two-
thirds of EBITDA, which makes Diagnostic Imaging vulnerable to any
regulatory changes or competitive challenges in the region.

Recently acquired New Jersey sites do not yet make a meaningful
contribution.


DIRECTV GROUP: Earns $458.7 Million in Quarter Ended June 30
------------------------------------------------------------
For the three months ended June 30, 2006, The DIRECTV Group Inc.
reported net income of $458.7 million from total revenues of
$3,520.0 million.

At June 30, 2006, the Company's balance sheet showed total assets
of $13,276.4 million, total liabilities of $7,270.0 million, and
total stockholders' equity of $6,006.4 million.

A full-text copy of the Company's financial report for the three
months ended June 30, 2006 is available for free at:

               http://researcharchives.com/t/s?fd7

Headquartered in El Segundo, California, The DIRECTV Group, Inc.
(NYSE: DTV) -- http://www.directv.com/-- provides direct
broadcast satellite service to more than 15 million customers in
the US and more than 1.5 million customers through its DIRECTV
Latin America segment.

                          *     *    *

The DIRECTV Group Inc.'s long-term local and foreign issuer
credits carry Standard & Poor's BB ratings.  The ratings were
placed on Aug. 9, 2004 with a stable outlook.


DURA AUTOMOTIVE: Hires Miller Buckfire as Restructuring Consultant
------------------------------------------------------------------
DURA Automotive Systems Inc. has turned to Miller Buckfire & Co.
for help on its financial debt restructuring, Reuters reports.

Company spokesman Robert Mead told Reuters that Miller Buckfire
was hired last week to evaluate DURA's capital structure.  Mr.
Mead said that while it was too early to speculate on how the
restructuring will be implemented, the Company intends to maintain
sufficient liquidity to operate its business during the process.

DURA had incurred a $131.3 million net loss on $573.3 million of
net revenues for the three months ended July 2, 2006.  In
conjunction with the release of its second quarter financial
results, Larry Denton, Chairman and Chief Executive Officer of
DURA announced that the Company intends to reduce its labor force
by 510 employees by year end.  The planned job cuts is in addition
to DURA's 50 cubed restructuring plan, which is focused on
structuring the Company's operations.

Headquartered in Rochester Hills, Michigan, DURA Automotive
Systems, Inc. -- http://www.duraauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies, structural
door modules and exterior trim systems for the global automotive
and recreation & specialty vehicle industries.  DURA, which
operates in 63 locations, sells its products to every major North
American, Asian and European automotive original equipment
manufacturer and many leading Tier 1 automotive suppliers.  It
currently operates in 63 locations including joint venture
companies and customer service centers in 14 countries.

                           *     *     *

As reported in the Troubled Company Reporter on Aug. 1, 2006,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Dura Automotive Systems Inc. to 'CCC' from 'B-'.  The
rating outlook is negative.


EASTGROUP PROPERTIES: Earns $5.5 Million in Quarter Ended June 30
-----------------------------------------------------------------
For the three months ended June 30, 2006, Eastgroup Properties
Inc. reported net income of $5,576,000 from total revenues of
$33,267,000.

At June 30, 2006, the Company's balance sheet showed total assets
of $866,852,000, total liabilities of $511,265,000 and total
stockholder's equity of $355,587,000.

A full-text copy of the Company's financial report for the three
months ended June 30, 2006 is available for free at:

               http://researcharchives.com/t/s?fdd

Headquartered in Jackson, Mississippi, EastGroup Properties Inc.
-- http://www.eastgroup.net/-- is a real estate investment trust
engaged in the development, acquisition, and operation of
industrial properties in the United States.

                          *     *     *

EastGroup Properties Inc.'s preferred stock carries Fitch's BB+
rating with a positive outlook.  The rating was placed on
Aug. 25, 2003.


EATON FERRY: Court Okays Rule 2004 Examination to Find Collateral
-----------------------------------------------------------------
The Honorable William L. Stocks of the U.S. Bankruptcy Court for
the Middle District of North Carolina in Durham authorized GE
Commercial Distribution Finance Corporation, fka Transamerica
Commercial Finance Corporation, to investigate Eaton Ferry Sales &
Service, Inc., and its debtor-affiliates pursuant to Rules 2004
and 9016 of the Federal Rules of Bankruptcy Procedure.  GE
Commercial is successor in interest to Bombardier Capital, Inc.

As reported in the Troubled Company Reporter on June 16, 2006, GE
Commercial wanted to obtain documents and records, and conduct
an examination concerning the acts, conduct, property, liabilities
and financial condition of the Debtors and matters relating to the
transfer of certain property of the Debtors' estates.

The Debtors sold over $1.3 million of GE Commercial collateral
without forwarding payment to GE Commercial or providing adequate
assurances that payment would be made, John D. Burns, Esq., at
Hunton & Williams, LLP, told the Court.

In an inspection made in November 2005, GE Commercial also learned
that the Debtors no longer possessed a sufficient amount of the
collateral to satisfy the outstanding debt due to GE Commercial.

In particular, GE Commercial wanted access to:

    a) all boat sales contracts and boat sales invoices from
       Jan. 1, 2004, to present;

    b) 2003, 2004, and 2005 federal and state tax returns for the
       Debtors;

    c) all balance sheets and financial statements prepared by or
       on behalf of the Debtors from Jan. 1, 2004, to present,
       whether audited or unaudited;

    d) all bank statements, including cancelled checks and deposit
       slips or receipts, for any bank accounts held in the names
       of any of the Debtors or used by any of the Debtors from
       Jan. 1, 2004 to present;

    e) all QuickBooks files and other financial information for
       each of the Debtors; and

    f) All documents and records related to accounts payable or
       other obligations of any of the Debtors, including but not
       limited to any payables files, invoices, memoranda,
       correspondence to or from any creditors of any of the
       Debtors reflecting an obligation owed by any of the
       Debtors.

In addition, GE Commercial also wanted to examine Kaye Powell, who
served as bookkeeper and accountant for the Debtors two years
prior to their bankruptcy filing.  Mr. Burns said that Ms. Powell
can provide information that will allow GE Commercial to better
understand what happened to its collateral and the proceeds from
its collateral.

Headquartered in Littleton, North Carolina, Eaton Ferry Sales &
Service, Inc. -- http://www.eatonferry.com/-- sold boats and
offered boat servicing and storage.  The Company and its debtor-
affiliates filed for chapter 11 protection on Jan. 10, 2006
(Bankr. M.D.N.C. Case No. 06-80033).  Richard M. Hutson, II, Esq.,
at Hutson Hughes & Powell, P.A., represent the Debtors.  When the
Debtors filed for protection from their creditors, they estimated
assets between $1 million and $10 million and estimated debts
between $10 million and $50 million.  Judge Stocks approved the
conversion of the Debtor to a chapter 7 liquidation on June 2,
2006.


ENRON CORP: Court Approves Nile Structure Settlement Agreement
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the settlement agreement of Enron Corp., EES Service
Holdings, Inc., and Enron North America Corp. dated June 20, 2006,
with:

    -- Credit Suisse, formerly known as Credit Suisse First
       Boston,

    -- DLJ Capital Funding,

    -- Sphinx Trust, and

    -- Wilmington Trust Company, as trustee of the Sphinx Trust.

In 2001, EESSH contributed 24,081,551 shares of common stock in
ServiceCo Holdings, Inc., to Pyramid I, LLC.

In exchange for the contribution of the ServiceCo Interests,
EESSH received a Class A membership interest in Pyramid and a
simultaneous "special distribution" of $25,000,000.  The Class A
Interest represents 100% of the voting interest, with certain
restrictions, in Pyramid and a 0.01% economic interest in
Pyramid.  The Special Distribution was ultimately transferred by
EESSH to Enron.

A Class B membership interest in Pyramid was issued to the Sphinx
Trust.  In consideration for the Class B Interest, the Trust made
a $25,000,000 capital contribution to Pyramid, which, in turn,
Pyramid used to fund the Special Distribution to EESSH.  The
Class B Interest is generally nonvoting and represents 99.99% of
the economic interest of Pyramid.

The Trust financed the Capital Contribution, in part, by
borrowing $23,991,207, under a credit facility, dated September
28, 2001, by and among the Trust, Credit Suisse, as
administrative agent, and the lenders party thereto.

To finance the balance of the Capital Contribution, the Trust
issued a certificate of beneficial ownership to DLJ for cash
consideration equal to $1,008,793.

The Trust's ability to repay amounts borrowed under the Credit
Facility was supported by a total return swap evidenced by:

   (i) an ISDA Master Agreement, dated as of September 28, 2001,
       between the Trust and ENA;

  (ii) a Schedule, dated as of September 28, 2001, between the
       Trust and ENA, modifying and supplementing the Master
       Agreement; and

(iii) a Total Return Swap Confirmation between the Trust and
       ENA, dated as of September 28, 2001.

Enron guaranteed to the Trust the payment and performance of all
obligations of ENA under the Nile Total Return Swap Documents
pursuant to an Enron Guaranty dated effective as of Sept. 28,
2001.

On October 10, 2002, the Trust filed:

      * Claim No. 13090 against Enron for $24,219,515; and
      * Claim No. 13091 against ENA for $24,219,515.

On April 25, 2003, most of the ServiceCo shareholders, including
EESSH and Pyramid, entered into a Redemption Agreement, providing
for the redemption of all or portions of their shares of
ServiceCo stock.  The initial closing of the Redemption Agreement
transactions occurred on June 9, 2003.

Pursuant to the terms of the Redemption Agreement, following the
subsequent consummation of a sale of ServiceCo and all or
substantially all of ServiceCo's assets, Pyramid was entitled to
receive a designated amount of cash in exchange for all of the
ServiceCo shares held by Pyramid, based upon the net worth of
ServiceCo at the time of the sale.

On November 7, 2003, ServiceCo and its subsidiaries entered into
an asset purchase agreement to sell substantially all of their
assets to The Linc Group, LLC, which transactions and the consent
of EESSH thereto were approved by an order of the Bankruptcy
Court, dated November 20, 2003.  On December 8, 2003, the
transactions contemplated by the Sale Agreement were consummated
and, as a result thereof, Pyramid received $1,131,766.

On September 26, 2003, Enron and several of its affiliates
commenced Adversary Proceeding No. 03-09266 (AJG), also known as
the MegaClaim Proceeding, against, among other persons, certain
Nile Releasing Parties.

On or about December 1, 2003, Enron and several of its affiliates
commenced Adversary Proceeding No. 03-93596 (AJG) against, among
other persons, certain Nile Releasing Parties.  The Standalone
Action was subsequently consolidated with the MegaClaim
Proceeding.

The parties have engaged in arm's length and good faith
negotiations and discussions concerning the Credit Facility, the
Certificate and the Nile Total Return Swap Documents and other
transaction documents relating to the Nile structure.

Pursuant to the Settlement Agreement, the parties agree that:

   (1) EESSH will cause Pyramid to pay to Credit Suisse:

         (i) all amounts held in Pyramid's accounts on the
             Closing Date, approximately $1,192,583; and

        (ii) an additional amount of $76,990;

   (2) Credit Suisse will cause the Trust to assign to EESSH all
       of its right, title and interest in and to the Class B
       Interest in Pyramid;

   (3) The Enron Claim will be allowed for $6,868,857 as a Class
       185 claim against Enron, and the ENA Claim will be allowed
       for  $22,896,190 as a Class 5 general unsecured claim
       against ENA.  The Trust will assign the Allowed Claims to
       Credit Suisse;

   (4) Enron will file a stipulation dismissing, with prejudice,
       its claims against the Trust and Pyramid in the MegaClaims
       Proceeding and the Standalone Action related to the Nile
       Transaction; and

   (5) The Enron Parties and the Nile Releasing Parties will
       release each other from all claims relating to the Nile
       Transaction or the Nile Total Return Swap Documents.

Headquartered in Houston, Texas, Enron Corporation filed for
chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case
No. 01-16033) following controversy over accounting procedures,
which caused Enron's stock price and credit rating to drop
sharply.  Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed.  The
Debtors' confirmed chapter 11 Plan took effect on Nov. 17, 2004.
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts.  Luc A. Despins, Esq., Matthew Scott Barr,
Esq., and Paul D. Malek, Esq., at Milbank, Tweed, Hadley & McCloy,
LLP, represent the Official Committee of Unsecured Creditors.
(Enron Bankruptcy News, Issue No. 177; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)


ENTERGY NEW ORLEANS: Seeks City Council Consent for Rates Hike
--------------------------------------------------------------
In September 2005, the City Council of New Orleans, Louisiana,
approved a two-year extension of Entergy New Orleans, Inc.'s
formula rate plan with a return on equity mid-point of 10.75%, a
45% hypothetical equity ratio, and electric and gas ROE bandwidths
of 100 and 50 basis points.  The Council's order temporarily
suspended the Generation Performance-Based Rate due to effects
from Hurricane Katrina.

According to Entergy Corp.'s 2006 earnings report filed with the
U.S. Securities and Exchange Commission, ENOI filed three Electric
and two Gas FRP Evaluation Reports on June 30, 2006.

ENOI's recommended alternative adjusts for lost customers and
assumes that the City Council's June 6, 2006 decision to allow
recovery of all Grand Gulf costs through the fuel adjustment
clause remains in place.  The recommended alternative increases
base rates $6,400,000 (4.4%) for Electric and $22,800,000
(160.9%) for Gas.

On June 30, ENOI also filed an Electric and Gas Storm Cost
Recovery Rider seeking recovery of $139,000,000, which is
$114,000,000 for Electric and $25,000,000 for Gas over a 10-year
period for costs incurred through March 31, 2006.  ENOI proposed
semi-annual filings to update the rider for additional restoration
spending.

Moreover, ENOI requested an Electric and Gas Storm Reserve Rider
to establish a $150,000,000 reserve -- $130,000,000 for Electric
and $20,000,000 for Gas -- for future storm costs over a 10-year
period.

Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned
subsidiary of Entergy Corporation.  Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans.  Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004.  Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing.  Entergy New Orleans filed for chapter 11 protection on
Sept. 23, 2005 (Bankr. E.D. La. Case No. 05-17697).  Elizabeth J.
Futrell, Esq., and R. Partick Vance, Esq., at Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., represent the
Debtor in its restructuring efforts.  Carey L. Menasco, Esq.,
Philip Kirkpatrick Jones, Jr., Esq., and Joseph P. Hebert, Esq.,
at Liskow & Lewis, APLC, represent the Official Committee of
Unsecured Creditors.  When the Debtor filed for protection from
its creditors, it listed total assets of $703,197,000 and total
debts of $610,421,000.  (Entergy New Orleans Bankruptcy News,
Issue No. 21; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


FEDERAL MOGUL: Insists Kenesis Group is "Disinterested"
-------------------------------------------------------
As reported in the Troubled Company Reporter on June 9, 2006,
Federal Mogul Corp. and its debtor-affiliates currently -- and
wish to continue -- using the services of The Kenesis Group LLC.
Hence, they seek the Court's permission pursuant to Section 327(a)
to employ the firm as their insurance consultants effective May 8,
2006.

As previously reported, the U.S. Trustee entered into a global
settlement agreement with Kenesis with respect three bankruptcy
cases in Region 3.  The settlement agreement, among others,
provides for Kenesis' payment of sums to these three bankruptcy
estates:

   1. Federal-Mogul Global, Inc., and T&N Limited et al.;

   2. Burns & Roe Enterprises, Inc. (Bank. D. N.J. Case No. 00-
      41610); and

   3. ACandS, Inc. (Bank. D. Del. Case No. 02-12687).

The U.S. Trustee withdrew, without prejudice, a request for
approval of the settlement in ACandS' case, but subsequently
refiled the motion in the U.S. District Court in these appellate
cases:

   1. ACandS, Inc., Appellant v. Travelers Casualty & Surety
      Co., Appellee, Case No. 03-894 (JJF); and

   2. ACandS, Inc., and The Kenesis Group, Appellants v. Kelly
      Beaudin Stapleton, U.S. Trustee and Travelers Casualty &
      Surety Co., Appellees, Case No. 03-895 (JJF).

The District Court has not set the hearing on the requests.  The
Settlement Motions in Federal-Mogul's and Burns' cases remain
pending.

Until all the pending Settlement Motions have been heard, granted
and non-appealable orders have been entered with respect to those
pending motions, the U.S. Trustee ask the Court to refrain from
considering the Debtors' Application.

                          Insurers Object

Certain insurance companies assert that Kenesis is not a
"disinterested person" and, thus, does not meet the requirements
of employment in Section 327(a) of the Bankruptcy Code.  These
insurers include:

   -- Mt. McKinley Insurance Company and Everest Reinsurance Co.;
   -- ACE Insurers; and
   -- Columbia Casualty Company, Continental Casualty Company and
      The Continental Insurance Company.

                 Responses to Insurers' Objections

A. Debtors

The Debtors maintain that Kenesis Group LLC is:

   -- a "disinterested person" under Sections 101(14) and 327(a)
      of the Bankruptcy Code;

   -- does not hold or represent an interest adverse to the
      Debtors' estates; and

   -- was not and is not a "professional" required to be retained
      pursuant to Section 327(a).

Had it not been for the agreement with the United States Trustee
to cause the Debtors to retain Kenesis "under the standard that
would be applicable to a professional retained under Section 327
(a)," Kenesis would not need to be retained as a professional
person now, James E. O'Neill, Esq., at Pachulski Stang Ziehl
Young Jones & Weintraub LLP, in Wilmington, Delaware, says.

Mr. O'Neill asserts that Kenesis' only work on behalf of asbestos
personal injury claimants was as an expert insurance consultant
in insurance disputes coverage for:

   -- Gilbert Heintz and Randolph and its co-counsel Weitz &
      Luxenbourg, P.C. in the Robert A. Keasbey Co. and Kentile
      Floors, Inc., matters; and

   -- GHR in its role as an expert witness on behalf of Kelley &
      Ferraro LLP in insurance coverage issues related to Insul
      Company, Inc.

"Kenesis has never represented or assisted asbestos claimants or
any other creditor in establishing the validity or amount of
their claims against the Debtors," Mr. O'Neill says.  "Kenesis
has never assisted asbestos claimants in establishing the
validity or amount of their claims against any other party.

The Debtors believe that the Insurers Objections are simply
thinly veiled attempts to prevent them from retaining Kenesis.

Kenesis, the expert of the Debtors' choice, will assist them in
evaluating their insurance claims against the Insurers, Mr.
O'Neill notes.

The Debtors ask the Court to overrule the Insurers' objection.

"The Insurers' attempts to thwart the Debtors' insurance recovery
efforts should be overruled and they should not be permitted to
interfere with the Debtors' insurance recovery efforts by
preventing the Debtors from retaining Kenesis," Mr. O'Neill
argues.

B. Kenesis

Kenesis asks the Court to approve the Debtors' application and
overrule the Insurers' objection.

According to Thomas D. Walsh, Esq., at McCarter & English, LLP,
in Wilmington, Delaware, the Insurers have known since at least
April 2003 that the Debtors retained Kenesis as a consultant
since the Insurers participated in meetings, negotiations,
mediations and communications directly with the firm over the
course of the past three years.

To now state that the Insurers believed the services were
"professional" in nature, and thus improper -- when they knew the
Debtors had not retained Kenesis under Section 327(a) of the
Bankruptcy Code -- is belied by their own conduct throughout the
Debtors' Chapter 11 proceedings, Mr. Walsh argues.

Similarly, Mr. Walsh asserts that the Insurers' claims that the
services Kenesis provided to Gilbert Heintz and Randolph in other
cases in unrelated insurance coverage litigation constitutes a
disqualifying conflict of interest for Kenesis, lacks credibility
since the Insurers have not objected to the continued retention
of GHR.

The Keasbey, Kentile, Insul, Kenesis and GHR relationships were
all disclosed to the creditors and to the Court well over a year
ago, with no objection at all, Mr. Walsh points out.

"Kenesis never provided any advice or services adverse to the
Debtors' estates," Mr. Walsh maintains.  "[W]ere there any real
conflict, the Insurers should have objected years ago. . . ."

Kenesis insists that it is disinterested and does not hold any
interests adverse to the Debtors' estates.

"[T]he Insurers' objections are simply opportunistic attempts to
gain a tactical advantage in their continued war with the Debtors
to delay and deny coverage,"  Mr. Walsh adds.

       Kenesis May Have Adverse Interest, U.S. Trustee Says

It appears that Kenesis did consulting analysis on insurance
policies for GHR and Weitz on behalf of tort claimants in the
Kentile and Keasbey cases, Kelly Beaudin Stapleton, the United
States Trustee for Region 3, tells the Court.  It follows that it
may be true that some of those claimants may also have claims
against the Debtors in their Chapter 11 cases, she says.

Hence, the U.S. Trustee says it may be accurate to state that
Kenesis has an adverse interest if it did work in conjunction
with or for GHR and Weitz on an insurance plan analysis matrix
for claimants in the Kentile and Keasbey matters, which claimants
may also have claims against the Debtors.

Any professional person that does not meet both the "no adverse
interest" and "disinterested person" tests is disqualified from
employment under Section 327(a), Richard L. Schepacarter, Esq.,
Trial Attorney for the Office of the U.S. Trustee, notes.

Without further information, explanation and disclosure, the U.S.
Trustee believes it will be unable to determine whether Kenesis
has "no adverse interest" to the Debtors.

                      About Federal-Mogul

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest
automotive parts companies with worldwide revenue of some
$6 billion.  The Company filed for chapter 11 protection on
Oct. 1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J. Nyhan
Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley
Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $10.15 billion
in assets and $8.86 billion in liabilities.  Federal-Mogul
Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill,
Bradford. Peter D. Wolfson, Esq., at Sonnenschein Nath &
Rosenthal; and Charlene D. Davis, Esq., Ashley B. Stitzer, Esq.,
and Eric M. Sutty, Esq., at The Bayard Firm represent the Official
Committee of Unsecured Creditors.  (Federal-Mogul Bankruptcy News,
Issue No. 111; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


FEDERAL-MOGUL: To Spend $6 Million Missouri  in Plant Closure
-------------------------------------------------------------
Federal-Mogul Corporation will close its Aftermarket Products and
Services manufacturing facility in St. Louis, Missouri, the
company disclosed in a regulatory filing with the U.S. Securities
and Exchange Commission.

Federal-Mogul says restructuring expenses associated with the
closure are estimated to be approximately $6 million and are
expected to continue into 2007.  Expected cost savings associated
with this project are estimated to be approximately $7.2 million
per year.

Federal-Mogul will also close its facilities located in Slough,
United Kingdom; and St. Johns, Michigan.  Moreover, certain low
volume production with high labor content will be transferred
from its facilities in Nuremberg and Wiesbaden, in Germany, to
existing facilities in best cost countries.

Federal-Mogul is continuing negotiations with the local Works
Councils at two additional European facilities related to the
potential closure of those sites.

In January 2006, Federal-Mogul laid out a global restructuring
plan as part of its global profitable growth strategy.  The plan
will affect 25 facilities and reduce the Company's workforce by
approximately 10% by the end of 2008.

During the quarter ended March 31, 2006, Federal-Mogul announced
the closure of its facilities located in Malden, Missouri;
Pontoise, France; and Rochdale, United Kingdom.

Federal-Mogul discloses that it has recorded $58.3 million in
restructuring charges associated with the restructuring program,
and expects to incur additional restructuring charges of up to
$95 million through 2008.  It expects to achieve $150 million in
annual cost savings subsequent to completion of the program.

                      About Federal-Mogul

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest
automotive parts companies with worldwide revenue of some
$6 billion.  The Company filed for chapter 11 protection on
Oct. 1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J. Nyhan
Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley
Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $10.15 billion
in assets and $8.86 billion in liabilities.  Federal-Mogul
Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill,
Bradford. Peter D. Wolfson, Esq., at Sonnenschein Nath &
Rosenthal; and Charlene D. Davis, Esq., Ashley B. Stitzer, Esq.,
and Eric M. Sutty, Esq., at The Bayard Firm represent the Official
Committee of Unsecured Creditors.  (Federal-Mogul Bankruptcy News,
Issue No. 112; Bankruptcy Creditors' Service, Inc. --
http://bankrupt.com/newsstand/-- 215/945-7000)


FLYI INC: Files Disclosure Statement & Liquidation Plan in Del.
---------------------------------------------------------------
FLYi, Inc., and its six debtor-affiliates delivered to the U.S.
Bankruptcy Court for the District of Delaware their Joint Plan of
Liquidation and Disclosure Statement on August 15, 2006.

According to FLYi President Richard Kennedy, the primary
objectives of the Plan are to:

   (a) maximize the value of the ultimate recoveries to all
       creditor groups on a fair and equitable basis; and

   (b) settle, compromise or otherwise dispose of certain claims
       and interests on terms that the Debtors believe to be fair
       and reasonable and in the best interests of their Estates
       and creditors.

The Plan provides for, among other things:

   (a) the liquidation and dissolution of each of the Debtors;

   (b) the establishment of a Distribution Trust to distribute
       the Distribution Trust Assets to the holders of Allowed
       Claims;

   (c) a global intercompany resolution;

   (d) the rejection of certain unexpired Executory Contracts and
       Unexpired Leases to which any Debtor is a party; and

   (e) certain other transactions to effect the Plan.

                    Substantive Consolidation

The Debtors consist of the ultimate parent company of the
Debtors' corporate family, FLYi, the Debtors' main operating
company, Independence Air, Inc., and five other legal entities
that effectively are dormant subsidiaries of either FLYi or
Independence Air.

Mr. Kennedy relates that the Plan seeks to substantively
consolidate the Debtors, other than FLYi, into Independence Air.
The Plan separately classifies claims against FLYi and
Independence Air.  The Plan also treats the assets of each of
FLYi and Independence as the separate assets of each entity.

                United Claim Settlement Allocation

The largest asset of the Debtors' Estates available for creditors
has been the Debtors' stock in UAL Corporation, the parent of
United Airlines, Inc.  The Debtors obtained the right to the UAL
stock pursuant to a Court-approved settlement with United
Airlines resolving the Debtors' unsecured claim in United
Airlines' own Chapter 11 bankruptcy proceeding.  The Claim
resulted from United Airlines' rejection of certain of its
contracts with the Debtors in its Chapter 11 case.

Pursuant to the terms of the United Claim Settlement, the Debtors
received a $750,000,000 allowed general unsecured claim in United
Airlines' Chapter 11 case.  The Claim entitled the Debtors to
receive a pro rata distribution of stock in reorganized United
Airlines pursuant to United Airlines' plan of reorganization.

The Debtors received an initial distribution of approximately
3,260,000 shares of UAL stock on June 23, 2006.  In consultation
with the Official Committee of Unsecured Creditors, the Debtors
developed a strategy pursuant to acceptable market terms with
respect to the monetization of the UAL stock.  The Debtors have
monetized all of the UAL stock pursuant to that strategy and have
realized $95,751,494 in net proceeds after transaction costs.

Under the United Airlines Plan of Reorganization, the Debtors
also are entitled to additional shares of UAL stock to the extent
that United Airlines resolves certain other unsecured claims
under its Reorganization Plan in an amount less than that
reserved for the other claims.

The Debtors expect to receive additional shares of the UAL stock
over time.  However, the amount and timing of the receipt of any
shares is uncertain.

                        Intercompany Claims

According to the Debtors' books and records, as of the Petition
Date, there was a net Intercompany Claim for $285,500,000 payable
by Independence Air to FLYi.  However, the amount of the
Intercompany Claim that should be treated as a debt obligation of
Independence Air to FLYi, rather than an equity contribution by
FLYi to Independence Air, is not clear, Mr. Kennedy says.

                   Global Intercompany Resolution

The Plan incorporates a global resolution of two significant
issues between the separate Estates of FLYi and Independence.  In
particular, the Plan allocates 50% of the net cash proceeds of
the United Claim to FLYi's estate and the other 50% to
Independence Air's estate in full satisfaction of the
Intercompany Claim.

In addition, as part of the Global Resolution, all administrative
and priority claims in the Debtors' Chapter 11 cases will be
deemed to be claims against Independence Air only and will be
paid only from Independence Air's assets, with the exception of
certain professional fees incurred during the Chapter 11 cases.

All postpetition professional fees of the Debtors and the
Creditors Committee's main restructuring advisors, as well as the
Debtors' claims agent and any Plan-related solicitation costs,
will be allocated equally between Independence Air and FLYi.  The
approximate amount of the postpetition fees of the firms for the
entirely of the Chapter 11 cases is currently estimated to be
approximately $14,600,000.

                          Effective Date

The Effective Date will not occur and the Plan will not be
consummated unless and until:

   (1) the Distribution Trust Agreement has been executed and the
       Trust Accounts have been established; and

   (2) the Plan Confirmation Order has been entered, is in full
       force and effect and has not been stayed.

As of the Effective Date, each of the Debtors will cease to exist
and the Distribution Trust Assets will be transferred to and vest
in the Distribution Trust, free and clear of claims, liens and
interests.

A full-text copy of the FLYi Joint Plan of Liquidation is
available for free at http://ResearchArchives.com/t/s?fe0

A full-text copy of the Disclosure Statement explaining the FLYi
Plan is available for free at http://ResearchArchives.com/t/s?fe1

                         About FLYi Inc.

Headquartered in Dulles, Virginia, FLYi, Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  Brett H. Miller, Esq., at Otterbourg,
Steindler, Houston & Rosen, P.C., represents the Official
Committee of Unsecured Creditors.  As of Sept. 30, 2005, the
Debtors listed assets totaling $378,500,000 and debts totaling
$455,400,000.  (FLYi Bankruptcy News, Issue No. 23; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


FLYI INC: Unsecured Creditors Likely to Receive 10.5% of Claims
---------------------------------------------------------------
FLYi, Inc., and its six debtor-affiliates delivered to the U.S.
Bankruptcy Court for the District of Delaware their Joint Plan of
Liquidation and Disclosure Statement on August 15, 2006.

Under the Joint Plan of Liquidation, the Debtors group claims and
interests into nine classes:

                                                    Estimated
Class      Claims                   Status        Amt. of Claims
-----      ------                   ------        --------------
N/A   Administrative Claims        Unimpaired                 -

N/A   Priority Tax Claims          Unimpaired                 -

  1    Secured Claims               Unimpaired       $14,000,000
       against any Debtor

  2    Priority Claims              Unimpaired       $900,000 to
       against any Debtor                            $12,900,000

  3    General Unsecured Claims     Impaired        $447,000,000
       against FLYi, other than                  to $895,000,000
       Class 5 Claims

  4    General Unsecured Claims     Impaired        $408,000,000
       against all Debtors other                 to $935,000,000
       than FLYi (other than
       Class 6 claims

  5    FLYi Convenience Claims      Impaired            $100,000
       (General Unsecured Claims                     to $200,000
       against FLYi for $1000
       or less)

  6    Independence Convenience     Impaired            $500,000
       Claims (General Unsecured                  to $12,800,000
       Claims against all Debtors
       other than FLYi for $1000
       or less)

  7    Intercompany Claim of FLYi   Unimpaired            N/A
       against Independence

  8    Penalty & Subordination      Impaired              N/A
       Claims

  9    Old Stock Interests          Impaired              N/A

The estimated percentage recoveries for certain claims are:

                                                Estimated
      Class      Claims                        % Recovery
      -----      ------                        ----------
        3    General Unsecured Claims         4.9% to 10.5%
             against FLYi, other than
             Class 5 Claims

        4    General Unsecured Claims         6.3% to 20%
             against all Debtors other
             than FLYi

        5    FLYi Convenience Claims                  15%

        6    Independence Convenience Claims           2%

                        Treatment of Claims

Each holder of an Allowed Administrative Claim against any Debtor
will receive from the Estate of the applicable Debtor, in full
satisfaction of the Claim, cash equal to the allowed Claim
Amount.

Each holder of an Allowed Priority Tax Claim will receive from
the Estate of the applicable Debtor, in full satisfaction of the
Claim, payment in full in cash.

In full satisfaction of an Allowed Secured Claim against a
Debtor, the Debtor will, at its sole and exclusive option:

   (i) pay from its Estate in cash in full the amount of the
       Allowed Secured Claim;

  (ii) return the collateral securing the Claim to the Claim
       holder; or

(iii) satisfy the Claim pursuant to other terms and conditions
       that may be agreed upon by the Debtor and the Claim
       holder.

Each holder of an Allowed Priority Claim against a Debtor will
receive from the applicable Debtors' Estate cash equal to the
Allowed Claim Amount.

Each holder of an Allowed General Unsecured Claim against FLYi
will receive a Pro Rata share of the FLYi Distribution Trust
Assets.

Each holder of an Allowed General Unsecured Claim against any
Debtor other than FLYi will receive a Pro Rata share of the
Independence Distribution Trust Assets.

Each holder of an Allowed FLYi Convenience Claim against FLYi
will receive cash from the FLYi Distribution Trust Account equal
to 15% of the Allowed Claim Amount.

Each holder of an Allowed Independence Convenience Claim against
a Debtor other than FLYi will receive Cash from the Independence
Distribution Trust Account equal to 25% of the Allowed Claim
Amount.

In connection with the global resolution of issues regarding the
allocation of the United Claim Settlement Proceeds among the
Debtors, unless otherwise directed by the Court, no property will
be distributed to or retained on account of the Intercompany
Claim, provided, however, that the Claim will be deemed to be
paid from the United Claim Settlement Proceeds in an amount equal
to FLYi's Pro Rata share of the Independence Distribution Trust
Assets, or in other manner or amount determined by the Court.

No property will be distributed to or retained by the holders of
Allowed Penalty and Subordination Claims and the holders of Old
Stock Interests.  The Interests will be terminated on the
Effective Date.

                         About FLYi Inc.

Headquartered in Dulles, Virginia, FLYi, Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  Brett H. Miller, Esq., at Otterbourg,
Steindler, Houston & Rosen, P.C., represents the Official
Committee of Unsecured Creditors.  As of Sept. 30, 2005, the
Debtors listed assets totaling $378,500,000 and debts totaling
$455,400,000.  (FLYi Bankruptcy News, Issue No. 23; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


FORD MOTOR: Plans to Expand & Accelerate Restructuring Plan
-----------------------------------------------------------
Ford Motor Co., plans to expand and accelerate the implementation
of its restructuring program named Way Forward, The Wall Street
Journal reports, citing people familiar with the Company's plans.

The Company is planning to close more factories, cut more
management jobs by another 10% to 30% and reduce benefits as it
reels from a $254 million net loss for the second quarter of 2006.
The original plan called for termination of 30,000 employees and
shutting down of 14 plants by 2012.

As reported in the Troubled Company Reporter on Aug. 4, 2006, the
Company hired Kenneth H.M. Leet as a strategic advisor to Bill
Ford, the Company's chairman and chief executive officer.  The
Company is trying to achieve its profitability and market share
goals using a two-pronged approach: (a) cut costs; and (b)
increase revenue.  To increase its market share, the Company plans
to introduce more products by investing up to $1 billion in
several of the company's Michigan facilities.

Amendments to the restructuring plan will be deliberated by the
Company's board of directors on Sept. 14, 2006.  Formal
announcements will come a week after that.

                         About Ford Motor

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

                         *     *     *

As reported in the Troubled Company Reporter on July 31, 2006,
Dominion Bond Rating Service lowered on July 21, 2006, Ford Motor
Company's long-term debt rating to B from BB, and lowered its
short-term debt rating to R-3 middle from R-3 high.

DBRS also lowered Ford Motor Credit Company's long-term debt
rating to BB(low) from BB, and confirmed Ford Credit's short-term
debt rating at R-3(high).

DBRS maintained a negative outlook for Ford Motor Company and Ford
Credit.

As reported in the Troubled Company Reporter on July 24, 2006,
Moody's Investors Service lowered the Corporate Family and senior
unsecured ratings of Ford Motor Company to B2 from Ba3 and the
senior unsecured rating of Ford Motor Credit Company to Ba3 from
Ba2.  The Speculative Grade Liquidity rating of Ford has been
confirmed at SGL-1, indicating very good liquidity over the coming
12 month period.  The outlook for the ratings is negative.

As reported in the Troubled Company Reporter on June 12, 2006,
Fitch downgraded long-term ratings for both Ford Motor Company and
Ford Motor Credit Company with a Negative Rating Outlook, and
assigned these Recovery Ratings:

  Ford:

    -- Issuer Default Rating to 'B+' from 'BB'
    -- Senior unsecured to 'BB-/RR3' from 'BB'

  FMCC:

    -- Issuer Default Rating to 'B+' from 'BB'

Fitch also affirms FMCC's senior unsecured debt at 'BB/RR2'.

As reported in the Troubled Company Reporter on July 3, 2006,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Ford Motor Co. and related units to 'B+' from 'BB-' and
affirmed its 'B-2' short-term rating.  The ratings were removed
from CreditWatch, where they were placed on May 25, 2006, with
negative implications.  The outlook is negative.


FUTURE MEDIA: Wants to Hire Silver & Freedman as Special Counsel
----------------------------------------------------------------
Future Media Productions, Inc., asks the U.S. Bankruptcy Court for
the Central District of California for permission to employ Silver
& Freedman, PLC, as its special employment and labor law counsel.

David L. Neale, Esq., at Levene, Neale, Bender, Rankin & Brill,
LLP, tells the Court that Daniel Dealba filed a complaint against
the Debtor.  The Alleged Class Action results from the Debtor's
alleged failure to give requisite notice in conjunction with the
termination of the employment of the Class Members.

The Debtor selected Silver & Freedman's services for the purpose
of responding to and dealing with the Alleged Class Action.

Silver & Freedman will:

   a) advise the Debtor and Levene Neale with regard to the
      Alleged Class Action and the issues raised;

   b) advise the Debtor and Levene Neale in connection with any
      proofs of claim filed by putative Class Members or former
      employees of the Debtor;

   c) repond to the complaint that initiated the Alleged Class
      Action and any amendments;

   d) assist the Debtor and Levene Neale in preparing objections
      to proofs of claim filed by putative Class Members or former
      employees of the Debtor;

   e) advise the Debtor and Levene Neale with regard to any
      proposed settlements of the Alleged Class Action or proofs
      of claim filed by putative Class Members or former employees
      of the Debtor;

   f) represent the Debtor in all aspects of litigation related to
      the Alleged Class Action or objections to proofs of claim
      filed by putative Class Members or former employees of the
      Debtor;

   g) prepare all pleadings, correspondence, discovery and
      documents related to a settlement or litigation of the
      Alleged Class Action or objections to proofs of claim filed
      by putative Class Members or former employees of the Debtor;
      and

   h) perform any other services which may be appropriate in
      Silver & Freedman's representation of the Debtor in the
      Alleged Class Action or in regard to objections to proofs of
      claim filed by putative Class Members or former employees of
      the Debtor.

The Firm's professionals bill:

        Professional                  Hourly Rate
        ------------                  -----------
        Maria C. Rodriguez, Esq.         $365
        Allison M. Holtzman, Esq.        $260
        Michelle C. Cuena, Esq.          $240

Ms. Rodriguez assures the Court that her firm does not represent
any interest adverse to the Debtor or its estate.

Headquartered in Valencia, California, Future Media Productions,
Inc. -- http://www.fmpi.com/-- provides CD and DVD replication
and packaging services on the West Coast.  The Company filed for
chapter 11 protection on Feb. 14, 2006 (Bankr. C.D. Calif. Case
No. 06-10170).  David I. Neale, Esq. at Levene, Neale, Bender,
Rankin & Brill, LLP, represent the Debtor in its restructuring
efforts.  Jeremy V. Richards, Esq., and Hamid R. Rafatjoo, Esq.,
at Pachulski Stang Ziehl Young Jones & Weintraub LLP represent the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed $12,370,783 in total
assets and $30,650,669 in total debts.


GENOIL INC: David Kippen Steps in as Interim CFO
------------------------------------------------
Genoil Inc. disclosed that David Kippen, who has acted as a
financial consultant to the Corporation since June 2006, will step
in as interim Chief Financial Officer for the remainder of 2006,
while the Company searches for a permanent replacement.

Since joining the Corporation, Mr. Kippen has been working on
building the Corporation's financial infrastructure, which
includes hiring additional financial staff such as a Controller.
He has over 13 years of investment banking experience with
specialization in mergers and acquisitions and capital fundraising
for growth stage private companies and established public
companies in North America, Europe and Asia.  He was previously
with Hambrecht & Quist and JP Morgan Chase for approximately ten
years, as well as working in the Natural Resources Group of Credit
Suisse First Boston.

David Lifschultz, chairman and chief executive officer, stated,
"The Board shares my excitement regarding Kippen's value-added to
Genoil.  His background includes over $38 billion of transaction
experience, and we are confident that he will help Genoil execute
on its business plan."

The Corporation disclosed that, in addition to his cash
compensation, its board of directors has approved the grant of
incentive stock options to Mr. Kippen to acquire up to 1,000,000
common shares of the Corporation.  The stock options were approved
with an exercise price of CDN$0.72 per common share.  In the event
that Mr. Kippen continues as chief financial officer beyond the
interim period, the stock options shall vest over the next four
years as follows: 250,000 upon the completion one year of
employment with the Corporation; and 250,000 per year on the
anniversary date of each year of Mr. Kippen's employment with the
Corporation.

The Corporation also disclosed that, Kirk Morgan has resigned as
chief financial officer, effective upon the completion and filing
of the Corporation's second quarter financial statements.  It also
is in the process of restructuring its accounting department and
is in the process of hiring a Controller.

                  Issuance of Convertible Note

The Corporation further disclosed that its Board has approved the
issuance of a convertible note to entities affiliated with David
K. Lifschultz, chairman, chief executive officer and a director of
the Corporation.  The Note is to be issued in consideration for
various loans, that have or are expected to be made, to the
Corporation by the Lifschultz Affiliates, currently in a principal
amount of $888,000.  The Note may be converted for common shares,
anytime within six months from the date of its issuance, based on
the principal amount of the loan divided by CDN$0.65 per common
share.  In connection with the issuance of the note, the
Corporation has additionally approved the grant of Common Share
purchase warrants in an amount equal to 25% of the number of
Common Shares issuable on conversion of the Note, exercisable for
a period of six months at CDN$0.98 per share.  No interest shall
be payable on the note.

Headquartered in Calgary, ALberta, Genoil Inc. (TSX VENTURE:
GNO)(OTCBB: GNOLF) -- http://www.genoil.net/-- is a technology
development and engineering company providing environmentally
sound solutions to the oil and gas industry through the use of
proprietary technologies.  The Genoil Hydroconversion Upgrader is
designed to economically convert heavy crude oil into more
valuable light upgraded crude, high in yields of transport fuels,
while significantly reducing the sulfur, nitrogen and other
contaminants.
                         *     *     *

                      Going Concern Doubt

BDO Dunwoody LLP expressed substantial doubt about Genoil Inc'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 working capital
deficiency and accumulated losses.


GLOBAL DOCUGRAPHIX: Gets Court Final Nod to Use Cash Collateral
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas
allowed, on a final basis, Global DocuGraphix, Inc., and Global
DocuGraphix USA, Inc., to use cash collateral securing repayment
of their indebtedness to General Electric Capital Corp. and
Antares Capital Corp.

When the Debtors filed for bankruptcy, they owed around $5,087,564
to GECC, their prepetition revolving lender, and around
$10,253,050 to their Antares Capital, the prepetition term
loan lender.  The Debtors, GECC and Antares are parties to a
certain Intercreditor and Subordination Agreement dated as of
October 10, 2003.  Under that agreement, the Debtors' loan from
Antares was subordinated in right of payment to their prepetition
loan to GECC.

The Debtors acknowledge they have no unencumbered source of
funding to operate their businesses.  As a result of their
financial condition, the Debtors have been unable to obtain
alternative sources of cash or credit either in the form of
unsecured credit allowable as an administrative expense under
Section 503(b)(1) of the Bankruptcy Code, unsecured credit
allowable under Sections 364(a) and 364(b) of the Bankruptcy Code,
or secured credit pursuant to Section 364(c) or (d) of the
Bankruptcy Code.

Consequently, if the Debtors are unable to obtain authority to use
the cash collateral, they would be unable to pay their operating
expenses, and their operations would be jeopardized.  This, in
turn, would severely impair the value of their assets and likewise
impair any opportunity to effectuate a going concern sale or
orderly wind-down of their businesses.

The Court granted the lenders postpetition replacement security
interest of the same priority, dignity and effect as its
prepetition interest in the Debtors' cash collateral.

Headquartered in Plano, Texas, Global DocuGraphix, Inc. --
http://www.gdxinc.com/-- is a commercial printing company
offering products and solutions for printing, advertising,
marketing, office, and document management.  The Company and its
subsidiary, Global DocuGraphix USA, Inc., filed for chapter 11
protection on July 18, 2006 (Bankr. N.D. Tex. Case No. 06-32889)
Holland N. O'Neil, Esq., and Richard McCoy Roberson, Esq., at
Gardere, Wynne and Sewell LLP represent the Debtors in their
restructuring efforts.  When the Debtors filed for bankruptcy,
they reported assets and debts totaling between $10 million and
$50 million.


GMAC LLC: S&P May Raise Ratings After 51% Ownership Interest Sale
-----------------------------------------------------------------
Standard & Poor's Ratings Services' ratings on GMAC LLC (formerly
General Motors Acceptance Corp.) (GMAC; 'BB/B-1') remain on
CreditWatch, where they were placed on Oct. 3, 2005, pending
completion of General Motors Corp.'s planned sale of 51% of
its ownership interest in GMAC to a consortium led by Cerberus
Capital Management.

Upon completion of the sale, Standard & Poor's is likely to raise
the ratings to 'BB+/B-1'.

"Several key closing conditions have recently been satisfied,
including the Pension Benefit Guaranty Corp.'s assurance that it
would not, as a result of the GMAC transaction, take action under
ERISA to terminate GM's pension plans or impose liability on the
purchaser or GMAC," explained Standard & Poor's credit analyst
Scott Spritzen.

In addition, Cerberus was granted U.S. FTC anti-trust approval for
the transaction, and GMAC finalized a $10 billion funding facility
with Citigroup.

However, on July 28, 2006, the FDIC announced a six-month
moratorium on approving ownership changes affecting industrial
loan companies.  The Cerberus consortium had submitted notices
with respect to GMAC's ILC, GMAC Automotive Bank, the timing of
the approval of which is likely to be affected by the moratorium.
FDIC approval of the Change in Bank Control Act notices with
regard to GMAC Automotive Bank is a condition to closing the GMAC
transaction.

GMAC and GM have disclosed that they are now working with the
consortium to consider ways of avoiding delay of the targeted
closing date (i.e., later in 2006).

Standard & Poor's will continue monitoring developments pertaining
to the transaction.


GRUPO IUSACELL: To Execute Convenio Concursal With Creditors
------------------------------------------------------------
Grupo Iusacell, S.A. de C.V., disclosed the advancement of its
restructuring process within the framework established by its
strategic plan, and that it hopes that the restructuring agreement
that has been reached in principle with the majority of its
creditors will be legally finalized soon.

As of Aug. 16, 2006, approximately 90% of Iusacell's creditors
have confirmed their support of the company's Plan of
Reorganization by means of the company's exchange offer and
consent solicitation that expired on June 1, 2006.  The company
believes that the high rate of approval of the Plan of
Reorganization signifies a clear confidence in the company's
management.

The restructuring consists of an exchange of $350 million of the
company's 14.25% notes due 2006 for $175 million of new notes due
2013 that will bear interest at annual rate of 10% (with semi-
annual interest payments in arrears including the option for
Iusacell to capitalize up to 40% of each interest payment).

Another milestone was reached in the legal implementation of the
restructuring agreement reached in principle with Iusacell's
creditors.  Iusacell filed a voluntary petition for concurso
mercantil before a Mexican judge -- Juez Septimo de Distrito en
Materia Civil del Primer Circuito, which today and as a part of
the restructuring process, issued a declaration of concurso
mercantile (sentencia de concurso) for Iusacell.  As a result of
this declaration, the company enters a new phase towards
completing its restructuring and expects to execute soon the
corresponding plan of reorganization (convenio concursal) to be
submitted before the Mexican court.  Accordingly to this type of
process, Iusacell has appointed various counsels to coordinate and
act in the judicial proceedings, including:

   -- Everardo Joaquin Espino,
   -- Enrique Gutierrez Flores,
   -- David Pablo Montes Ramirez and
   -- Ivan Sanchez Montero.

The Federal Institute Specializing in Concursos Mercantiles
(Instituto Federal de Especialistas en Concursos Mercantiles) was
the entity responsible of the review of Iusacell's books and
records that concluded satisfactorily with the report of the
examiner Mr. Pablo Octaviano Mendoza Garcia.

                    About Grupo Iusacell

Headquartered in Mexico City, Mexico, Grupo Iusacell, S.A. de
C.V. (BMV: CEL) -- http://www.iusacell.com-- is a wireless
cellular and PCS service provider in Mexico with a national
footprint.  Independent of the negotiations towards the
restructuring of its debt, Grupo Iusacell reinforces its
commitment with customers, employees and suppliers and
guarantees the highest quality standards in its daily operations
offering more and better voice communication and data services
through state-of-the-art technology, including its new 3G
network, throughout all of the regions in which it operate.

As of Dec. 31, 2005, Grupo Iusacell's stockholders' deficit
widened to MXN2,076,000,000 from a deficit of MXN1,187,000,000
at Dec. 31, 2004.

Grupo Iusacell filed for bankruptcy protection on June 18 under
Mexican Law to prevent creditors from disrupting its debt
restructuring talks.  On July 14, 2006, Gramercy Emerging
Markets Fund, Pallmall LLC and Kapali LLC, owed an aggregate
amount of $55,878,000 filed an Involuntary Chapter 11 Case
against Grupo Iusacell's operating subsidiary, Grupo Iusacell
Celular, S.A. de C.V. (Bankr. S.D.N.Y. Case No. 06-11599).  Alan
M. Field, Esq., at Manatt, Phelps & Phillips, LLP, represents
the petitioners.

Iusacell Celular then filed for bankruptcy protection under
Mexican Law on July 18.


HINES HORTICULTURE: Posts $774,000 2006 Second Quarter Net Loss
---------------------------------------------------------------
Hines Horticulture, Inc.'s reported net loss of $774,00 for the
three months ended June 30, 2006, compared to a net income of
$14.7 million for the same period in 2005.

The Company recorded an $8 million asset impairment charge to
operating income at June 30, 2006, which, together with lower net
sales volume and gross profit decline, impacted net income.

Net loss of the Company for the six months ended June 30, 2006,
was $5.2 million, compared to net income of $13 million, for the
comparable period a year ago.

The Company's net sales for the second quarter of 2006, was
$154.9 million, down 12.4% from $176.9 million for the second
quarter a year ago.  Net sales for the six-month period ended June
30, 2006 of $211.8 million declined 12.1% from net sales of $240.9
million for the comparable period in 2005.

"Delayed product availability as a result of rain in Northern
California, poor product sell-through at our customers' stores in
the Southeast and lost market share throughout the Eastern Region
all contributed to the sales decline in the second quarter
compared to a year ago," Rob Ferguson, chief executive officer,
said.  "Despite our efforts, our market share in the Northeast,
Mid-Atlantic and Southeast has continued to deteriorate.  More
intense competition, significant pricing pressures and customer
consolidations have all contributed to the decline in net sales in
these regions.  Going forward, we are focused on exploring the
options available to the Company designed to strengthen our
competitive position in the markets where we have a more stable
presence, as well as pursuing the divestiture of certain assets
that will enable us to improve liquidity, reduce leverage and
concentrate on our continuing business."

Hines Horticulture Inc. (NASDAQ: HORT)
-- http://www.hineshorticulture.com-- operates commercial
nurseries in North America, producing a broad assortment of
container grown plants.  Hines Horticulture sells nursery products
primarily to the retail segment, which includes premium
independent garden centers, as well as leading home centers and
mass merchandisers, such as Home Depot, Lowe's and Wal-Mart.

                         *     *     *

Hines Horticulture Inc.'s 10-1/4% Bonds carry Moody's Investors
Service's B3 rating and Standard & Poor's Ratings Services' CCC+
rating.


INCO LTD: Board Says CVRD Offer Could Be a Superior Proposal
------------------------------------------------------------
Inco Limited gave its response to the offer commenced by Companhia
Vale do Rio Doce to purchase for cash all of the outstanding
common shares of Inco.

Inco's Board of Directors carefully reviewed and considered the
CVRD Offer, in consultation with its financial and legal advisors
and in the context of its legal obligations under its existing
Combination Agreement with Phelps Dodge Corporation.

Subject to certain exceptions, the Combination Agreement between
Inco and Phelps Dodge requires that Inco's Board of Directors
continue to recommend that Inco shareholders vote in favor of the
arrangement between Inco and Phelps Dodge unless it determines
that an acquisition proposal, in this case, the CVRD Offer,
constitutes a "superior proposal" and certain other requirements
are met.  The Board did not make the determination that the CVRD
Offer is a "superior proposal" for purposes of the Combination
Agreement and accordingly continues to recommend that Inco
shareholders vote in favor of the proposed combination between
Inco and Phelps Dodge.

However, the Board did determine, based on information then
available and after consultation with its advisors, that the CVRD
Offer could reasonably be expected to result in a "superior
proposal" for purposes of the Combination Agreement.  This
determination allows Inco to engage in discussions and
negotiations with CVRD pursuant to the terms of the Combination
Agreement and, accordingly, the Board has authorized Inco's senior
management and its advisors to engage in such discussions and
negotiations.

The CVRD Offer is open for acceptance until Sept. 28, 2006 and is
subject to a number of conditions.  Accordingly, there is no
necessity for Inco shareholders to take any action with respect to
the CVRD Offer at this time.  At this time, the Inco Board of
Directors has determined to remain neutral and to make no
recommendation to Inco shareholders in respect of the CVRD Offer.

                          About CVRD

Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.

                       About Inco Ltd.

Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) --
http://www.inco.com/-- produces nickel, which is used primarily
for manufacturing stainless steel and batteries.  Inco also
mines and processes copper, gold, cobalt, and platinum group
metals.  It makes nickel battery materials and nickel foams,
flakes, and powders for use in catalysts, electronics, and
paints.  Sulphuric acid and liquid sulphur dioxide are produced
as byproducts.  The company's primary mining and processing
operations are in Canada, Indonesia, and the U.K.

                          *     *     *

Inco Limited's 3-1/2% Subordinated Convertible Debentures due
2052 carry Moody's Investors Service's Ba1 rating.


INCO LIMITED: Teck Cominco Withdraws Proposed Equity Offering
-------------------------------------------------------------
Teck Cominco Limited will not be amending its outstanding offer to
acquire all of the outstanding common shares of Inco Limited.

Teck's offer for Inco expired at midnight (Toronto time) on  Aug.
16, 2006.

"While we received strong support from a large number of
institutional investors, in the end we could not complete the
proposed equity offering on terms that made sense for Teck
Cominco," Teck Cominco President and Chief Executive Officer Don
Lindsay said.  "Accordingly, we will not amend or extend our bid
for Inco.  We will now pursue some of the many other opportunities
we see to grow Teck Cominco and to add value for our shareholders,
both through enhancements to our existing assets and through
acquisitions."

                       About Teck Cominco

Headquartered in Vancouver, Canada, Teck Cominco Limited (TSX:
TCK.A; TCK.B; NYSE: TCK) -- http://www.teckcominco.com/-- is a
diversified mining company.  The Company focuses in the production
of zinc and metallurgical coal and also produces copper, gold and
specialty metals.

                         About Inco Ltd.

Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) --
http://www.inco.com/-- produces nickel, which is used primarily
for manufacturing stainless steel and batteries.  Inco also
mines and processes copper, gold, cobalt, and platinum group
metals.  It makes nickel battery materials and nickel foams,
flakes, and powders for use in catalysts, electronics, and
paints.  Sulphuric acid and liquid sulphur dioxide are produced
as byproducts.  The company's primary mining and processing
operations are in Canada, Indonesia, and the U.K.

                          *     *     *

Inco Limited's 3-1/2% Subordinated Convertible Debentures due
2052 carry Moody's Investors Service's Ba1 rating.


IPIX CORPORATION: Selling All Assets Under Chapter 7
----------------------------------------------------
Worldwide interest is expected in the liquidation of IPIX
Corporation, a company whose patented 360-degree surveillance
technology takes on heightened importance in an era of global
terrorist attacks and security breaches.

The Company filed a voluntary petition for relief under Chapter 7
of the U.S. Bankruptcy Code on July 31, 2006, in the U.S.
Bankruptcy Court for the Eastern District of Virginia, Alexandria
Division (Case No. 06-10856).  As a result of the filing, IPIX
terminated all business activities after concluding it didn't have
sufficient funding to remain solvent and was unsuccessful in
securing the additional funding crucial for continued operation.

Donald F. King, an attorney with Odin Feldman and Pittleman, PC,
in Fairfax, Virginia, is the court-appointed trustee, overseeing
the orderly liquidation of all IPIX Corporation assets during the
next few months.

The sales agent supporting the Trustee is Stephen Karbelk,
executive vice president of Tranzon Fox, in Fairfax, Virginia.

IPIX earned an international reputation for the quality of its
high-resolution digital 360-degree video cameras and immersive
still photography business.  Its patented technology has the
ability to provide complete video coverage -- ideal for homeland
security purposes -- including airport surveillance, U.S. border
management and military operations.

A burgeoning commercial business complemented the military side,
as industries used the technology to enhance their operations.
Realtors, for example, installed the software and technology to
offer virtual tours of properties and retailers bought IPIX
products to bring added safety and anti- theft measures to store
locations.

According to Mr. King, "We plan to identify qualified bidders for
the IPIX assets and establish defined bidding procedures so all
interested buyers will have the opportunity to bid on the assets."

IPIX assets will be divided into three categories:

    * a 360-degree Digital Immersive Video business line,
      including the CommandView(TM) product line;

    * the Still Photography business line, including the Host@IPIX
      self-service management for immersive image distribution;
      and

    * the Gigapixel Camera patents, an experimental high-
      resolution camera developed through a federal government
      research project.

Buyers will be able to bid on individual and multiple patents,
trademarks, plus video equipment and accessories.

The brand name "IPIX" also is available for purchase.  All sales
are subject to Court approval.

"We expect buyers of these assets will be able to maximize the
full potential of IPIX's patented technologies as well as continue
to grow the IPIX customer base," says Karbelk, who expects buyer
interest to come from around the world.  "By offering the assets
by business line, we give every buyer, regardless of their level
of interest, the opportunity to make bids."

"This technology is needed by any person, any company, and any
government that is concerned about security."

                      About Tranzon Fox

Based in Virginia Beach, Virginia, Tranzon Fox is a full-service
real estate auction company and a member company of Tranzon,
L.L.C.  Founded in 2001, Tranzon L.L.C. has 14 independently owned
and operated member auction companies that collectively have more
than 20 offices coast-to-coast.

Contact:

     Stephen Karbelk
     Tranzon Fox
     Telephone (703) 912-3307

                    About IPIX Corporation

Headquartered in Reston, Virginia, IPIX Corporation (NASDAQ:IPIX)
-- http://www.ipix.com/-- is a premium provider of immersive
imaging products for government and commercial applications.  The
company combines experience, patented technology and strategic
partnerships to deliver visual intelligence solutions worldwide.
The company's immersive, 360-degree imaging technology has been
used to create high-resolution digital still photography and video
products for surveillance, visual documentation and forensic
analysis.

At March 31, 2006, the Company's balance sheet showed $7,795,000
in total assets and $4,940,000 in total liabilities.


KAISER ALUMINUM: Parties Respond to Agrium's Move to Pursue Claim
-----------------------------------------------------------------
Century Indemnity Company, ACE Property & Casualty Company,
Industrial Indemnity Company, Industrial Underwriters Insurance
Company, Pacific Employers Insurance Company, and Central
National Insurance Company of Omaha describe the motion filed by
the Agrium Companies as an "echo of the unsuccessful attempts" by
Daniel Freeman and the Estate of Savannah Olson to assert untimely
claims.

As reported in the Troubled Company Reporter on Aug. 8, 2006,
Agrium, Inc., and Agrium U.S., Inc., asked the U.S. Bankruptcy
Court for the District of Delaware to:

   (a) declare that the automatic stay does not apply;

   (b) interpret Kaiser Aluminum & Chemical Corp.'s Plan to
       determine the appropriate treatment of their claim; and

   (c) modify the discharge injunction to permit them to
       liquidate their claims against the estate, or the
       Reorganized Debtors, and pursue their claims against any
       available insurance.

Daniel Freeman and Lance Olson, as the Estate of Savannah Olson,
filed civil actions against Kaiser, the Agrium Companies, among
others, seeking recovery on numerous claims relating to
environmental contamination of ground water and soil.  The cases
were pending before the U.S. District Court for the Central
District of Illinois, Springfield Division.

If permitted by the Court to pursue any insurance coverage
available, the Agrium Companies will violate the ACE Parties'
rights under their Court-approved settlement with Kaiser Aluminum
Corp., Thomas G. Whalen, Jr., Esq., at Stevens & Lee P.C., in
Wilmington, Delaware, asserts.

Thus, the ACE Parties seek express acknowledgment that the Agrium
Companies seek no insurance coverage from them or the Subject
Policies on account of the alleged contribution claims.

Failing that, the ACE Parties ask the Court for an affirmative
ruling that the Agrium Companies have no right to insurance
coverage against them, and that any attempt to assert contribution
claims remains permanently restrained and enjoined.

The ACE Parties reserve their right to demand that Kaiser's
Funding Vehicle Trust enforce the Personal Injury Channeling
Injunction pursuant to the Settlement Agreement if the:

   (a) alleged Agrium Companies contribution claims are deemed to
       be Channeled PI claims; or

   (b) Agrium Companies seek to enforce any claims against any of
       the ACE Parties or the Subject Policies that are otherwise
       enjoined by the PI Channeling Injunction.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on Feb.
12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts. Lazard Freres & Co. serves as the Debtors'
financial advisor.  Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.
The Debtors' Chapter 11 Plan became effective on July 6, 2006.  On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts.  (Kaiser Bankruptcy News, Issue No. 103;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 609/392-0900)


KNOLOGY INC: S&P Junks Ratings on $150 Million Shelf Registration
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'CCC+'
debt and 'CCC' preferred stock ratings to the $150 million
universal shelf registration filed Aug. 11 by West Point, Georgia-
based Knology Inc.

At the same time, the rating agency affirmed the 'B' corporate
credit rating, 'B' first-lien bank loan and '3' recovery ratings,
and 'CCC+' second-lien bank loan and '5' recovery ratings.  The
outlook remains stable.

"Ratings for Knology reflect the company's vulnerable market
position and uncertain long-term sustainability as a cable
overbuilder providing undifferentiated services in a fiercely
competitive landscape and its small scale, which limits its
pricing power in negotiating contracts," said Standard & Poor's
credit analyst Allyn Arden.

The ratings also reflect an unfavorable cost position relative to
the incumbent cable operators, high leverage, and limited long-
term liquidity if the company loses subscribers to competitors.

Tempering factors include:

   * Knology's reputation for excellent customer service, which
     has translated into superior average revenue per user in
     established markets from penetration of bundled offerings
     despite intense competition;

   * a fully upgraded plant with two-way capability; and

   * the continued expectation of healthy revenue and EBITDA
     growth.

Another positive factor is the generation of positive
discretionary cash flow due partly to improvement in the recently
acquired Pinellas, Flordia, market, which had been a drain on
consolidated cash flow.


LAND O'LAKES: S&P Rates $225 Million Senior Credit Facility at BB+
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its existing ratings on
Arden Hill, Minnesota-based Land O'Lakes Inc.  The corporate
credit rating was raised to 'BB-' from 'B+'.  The rating outlook
is stable.

About $719 million of debt (adjusted for capitalized operating
leases, accounts receivable securitization, and 50% of preferred
securities, but unadjusted for pension and post-retirement
obligations) is affected.

At the same time, Standard & Poor's assigned its loan and recovery
ratings to Land O'Lakes' $225 million senior secured revolving
credit facility.  The revolving credit facility was rated 'BB+'
(two notches higher than the corporate credit rating on the
cooperative) with a recovery rating of '1', indicating a high
expectation for full recovery of principal in the event of a
payment default.  The rating is based on preliminary documents and
is subject to review upon final documentation.

Upon closing of this transaction, the ratings on the cooperative's
existing $200 million senior secured revolving credit facility
will be withdrawn.

"The rating on Land O'Lakes reflects the inherent cyclical nature
and seasonality of many of the cooperative's agricultural-based
businesses, low margins, and a leveraged financial profile," said
Standard & Poor's credit analyst Jayne Ross.

"These factors are somewhat mitigated by the strength of many of
the cooperative's brands, its moderate discretionary cash flow,
and an experienced management team."

Land O'Lakes is a national, farmer-owned dairy and agricultural
marketing and supply cooperative.  The dairy segment produces and
markets products under the strong Land O'Lakes and Alpine Lace
brands, as well as under regional brands.  Agricultural products
consist of seed, animal feed, and an extensive line of
agricultural supplies and services to farmers and local
cooperatives.

The ratings also reflect the firm's diverse product line,
geographic coverage, strong consumer brand franchise, and a more
manageable debt burden with modest near-term debt maturities.

However, the cooperative's debt burden is still sizable given the
firm's low margins and the volatility in its operating results.
In addition, Land O'Lakes owns Purina Mills, which is part of Land
O'Lakes Purina Feed LLC.  This operation has the leading market
position in the fragmented, but consolidating, U.S. animal feed
industry, as well as a portfolio of national (Land O'Lakes and
Purina Mills brands), regional, and local brands, and broad
geographic coverage.

In the past year and a half, Land O'Lakes has made significant
progress in repaying some of its sizable debt burden, and there
has been stabilization and improvement in credit protection
measures.

Standard & Poor's believes that the cooperative will have the
ability to better weather the seasonality and volatility in its
agricultural-based operating segments.  Although some of the
issues facing Land O'Lakes are beyond its immediate control and
reflect the vagaries of the agricultural sector, the rating agency
expects that the cooperative will continue to look to more
aggressively rationalize its operations, reduce operating expenses
to help mitigate margin pressure, and exit unprofitable business
lines.

Standard & Poor's estimates that capital expenditures will be
equal to depreciation over the next several years.


LEVITZ HOME: Names Jane Gilmartin as Merchandising Head
-------------------------------------------------------
Levitz Furniture has appointed Jane Gilmartin as Senior Vice
President, Chief Merchandising Officer.  Ms. Gilmartin will report
to Tom Baumlin, Chief Executive Officer.

Ms. Gilmartin, who most recently was Executive Vice President and
Chief Merchandising Officer for Linens 'N Things, will be
responsible for buying, merchandise planning and allocation, and
visual merchandising.  Ms. Gilmartin has served in senior
executive roles within a variety of retail and retail associated
environments, including DD's Discounts (a division of Ross
Stores), Intercontinental Art, Bed, Bath & Beyond, and Fortunoff.

"Jane brings an incredible depth and breadth of experience to
Levitz and will play a central role in our commitment to deliver
an expanded and compelling merchandise assortment to our
customers," said Mr. Baumlin.  "Her diverse experience in fashion,
visual merchandising, and executive leadership will be put to
immediate use in our strategic and tactical planning as we build
on the momentum established in the past few months."

Following the recent appointments of Elliott Wahle as Chairman,
Mr. Baumlin as CEO, and Kathy Guinnessey as CFO, the addition of
Ms. Gilmartin as Levitz' chief merchant is a key milestone as the
Company continues to attract accomplished retail industry veterans
to guide the revitalization of the brand.

"The newly opened and recently renovated Levitz stores are
receiving tremendous support from our customers and trade
partners.  I'm eager to lead another key element of our plans,"
said Ms. Gilmartin.  "Levitz is a world-class brand and an
energized organization.  We look forward to delivering improved
and exceptional style, along with the unparalleled quality and
value customers expect from Levitz."

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States.  The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189).  David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts.  Jay R. Indyke, Esq., at Kronish Lieb Weiner & Hellman
LLP represents the Official Committee of Unsecured Creditors.
Levitz sold substantially all of its assets to Prentice Capital on
Dec. 19, 2005.  (Levitz Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


LEVITZ HOME: Allows Creditors' Panel to Pursue Estate Actions
-------------------------------------------------------------
Pursuant to a stipulation, the Official Committee of Unsecured
Creditors of Levitz Home Furnishings, Inc., and its debtor-
affiliates is granted the authority and standing to bring Estate
Actions, on behalf of the Debtors' estates, without the necessity
of first filing a motion seeking authority to do so or further
order of the U.S. Bankruptcy Court for the Southern District of
New York.

The order authorizing the sale of substantially all the Debtors'
assets to PLVTZ, LLC, and the Pride Capital Group, pursuant to an
Asset Purchase Agreement dated as of Nov. 30, 2005, included the
Debtors' right, title and interest in avoidance actions and other
causes of action, as defined in the APA.

The Sale Order also established a trust for the benefit of general
unsecured creditors, which trust is a product of an agreement
between the Official Committee of Unsecured Creditors and Prentice
Capital Management, L.P.

The GUC Trust:

    (a) is comprised of 10 separate categories in which PLVTZ, as
        DIP Lender, and the holders of allowed general non-
        priority unsecured claims against the Debtors, share in
        proceeds or savings realized within those categories; and

    (b) provides general non-priority unsecured creditors with,
        among other Sharing Opportunities, an interest in 50% of
        the proceeds of the Debtors' Estate Actions.

A full-text copy of the GUC Trust is available for free at:

                http://researcharchives.com/t/s?fc7

Despite the terms of the Sale Order and APA, which provide the
Debtors with, among other things, the authority to assign right,
title and interest in the Estate Actions to the Purchasers,
neither the Purchasers nor the DIP Lender ever caused the Debtors
to exercise that authority.

Accordingly, the Debtors, the Creditors Committee, and PLVTZ
acknowledge and affirm that the Estate Actions have at all times
remained in the possession of the Debtors' estates.

In accordance with the terms of the GUC Trust, the DIP Lender and
the GUC Trust, will share any and all proceeds of the Estate
Actions.

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States.  The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189).  David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts.  Jay R. Indyke, Esq., at Kronish Lieb Weiner & Hellman
LLP represents the Official Committee of Unsecured Creditors.
Levitz sold substantially all of its assets to Prentice Capital on
Dec. 19, 2005.  (Levitz Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


LIQUIDMETAL TECH: June 30 Balance Sheet Upside-Down by $10.8 Mil.
-----------------------------------------------------------------
Liquidmetal Technologies filed its financial results for the
second quarter ended June 30, 2006, with the Securities and
Exchange Commission on Aug. 9, 2006.

For the three months ended June 30, 2006, the Company incurred a
$7.9 million net loss on $7.0 million of net revenues, compared to
a $5.5 million net loss on $3.7 million of net revenues in 2005.

At June 30, 2006, the Company's balance sheet showed $24.9 million
in total assets and $35.8 million in total liabilities, resulting
in a $10.8 million stockholders' deficit.

The Company's June 30 balance sheet also showed strained liquidity
with $10.1 million in total current assets available to pay
$31.7 million in total current liabilities coming due within the
next 12 months.

A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?fca

Liquidmetal Technologies -- http://www.liquidmetal.com/-- is a
developer, manufacturer, and marketer of products made
from amorphous alloys. Amorphous alloys are unique materials that
are characterized by a random atomic structure, in contrast to the
crystalline atomic structure possessed by ordinary metals and
alloys.  Liquidmetal Technologies is the first company to produce
amorphous alloys in commercially viable bulk form, enabling
significant improvements in products across a wide array of
industries.  The combination of a super alloy's performance
coupled with unique processing advantages positions Liquidmetal
alloys for what the company believes will be The Third
Revolution(TM) in material science.

                        Going Concern Doubt

Choi, Kim & Park LLP in Los Angeles, California, expressed
substantial doubt about Liquidmetal Technologies' ability to
continue as a going concern after auditing the Company's financial
statements for the fiscal year ended Dec. 31, 2005.  The auditing
firm pointed to the Company's operating losses and working capital
deficit.


MAGNA ENT: June 30 Working Capital Deficit is $139.9 Million
------------------------------------------------------------
Magna Entertainment Corp. delivered its second quarter financial
statements for the three months ended June 30, 2006, to the
Securities and Exchange Commission on Aug. 9, 2006.

At June 30, 2006, the Company's balance sheet showed
$1.446 billion in total assets, $999.475 million in total
liabilities, and $447.494 million in total shareholders' equity.

The Company has a working capital deficiency of $139.938 million
at June 30, 2006.

"Our second quarter's EBITDA is marginally below the prior year as
operational improvements and EBITDA gains were more than offset by
severance costs, asset write-offs and other charges," Frank
Stronach, chairman and interim chief executive officer of MEC,
remarked in announcing the Company's results.

"While EBITDA is positive, net loss from continuing operations
continues to be impacted by significant interest charges.  We
remain focused on reducing debt in the months ahead, and with the
expected collection in the fourth quarter of 2006 of the
$175.0 million note from the sale of The Meadows, the proceeds of
which will primarily be used to repay debt, we expect that our
balance sheet will be much stronger by year end."

"Our racetracks operate for prescribed periods each year.  As a
result, our racing revenues and operating results for any quarter
will not be indicative of our racing revenues and operating
results for the year.

"Our financial results for the three and six months ended June 30,
2006, reflect the full quarter's operations for all of MEC's
racetracks and related pari-mutuel wagering operations.
Discontinued operations for the three and six months ended
June 30, 2006, include the operations of a restaurant and related
real estate in the United States, the sale of which was completed
on May 26, 2006.

"Discontinued operations for the three and six months ended
June 30, 2005, include the operations of the above noted
restaurant and related real estate in the United States, Flamboro
Downs, the sale of which was completed on Oct. 19, 2005, and
Maryland-Virginia Racing Circuit, Inc., the sale of which was
completed on Sept. 30, 2005.

"Revenues were $184.8 million in the three months ended June 30,
2006, compared to $168.3 million in the three months ended June
30, 2005, an increase of $16.5 million or 9.8%.  The increased
revenues were primarily a result of:

   -- Southern U.S. operations revenues above the prior year
      period by $12.5 million due to gaming revenues at the
      Remington Park casino facility, which opened in Nov. 2005,
      partially offset by decreased handle and revenues at Lone
      Star Park due to five fewer live race days this quarter
      compared to the prior year and increased competition from
      racetracks in surrounding states and internet wagering
      operations;

   -- Maryland operations revenues above the prior year period by
      $2.1 million due to increased food and beverage revenues
      from Maryland Turf Caterers, the food and beverage
      operations at Laurel Park and Pimlico, which was acquired in
      September 2005.  These operations are now being consolidated
      into the Maryland operations, whereas previously the
      operations were accounted for on an equity basis;

   -- California operations revenues above the prior year period
      by $2.0 million due to increased handle and wagering
      revenues at Santa Anita Park as a result of four additional
      live race days this quarter compared to the prior year,
      partially offset by a change in the racing calendar at
      Golden Gate Fields, which resulted in four fewer live race
      days this quarter compared to the prior year; and

   -- European operations revenues above the prior year period by
      $1.2 million due to increased wagering revenues at
      MagnaBet(TM), our European account wagering platform.

"Revenues were $465.2 million in the six months ended June 30,
2006, an increase of $52.3 million or 12.7% compared with
$412.9 million for the six months ended June 30, 2005.  The
increased revenues in the six months ended June 30, 2006, compared
with the prior year comparative period are primarily due to the
same factors noted above for the three months ended June 30, 2006,
except that for the six months ended June 30, 2006, revenues at
Golden Gate Fields increased from the prior year comparative
period due to a change in the racing calendar whereby live race
days were increased from 50 days in the six months ended June 30,
2005, to 65 days in the six months ended June 30, 2006.  Our
Florida operations also experienced increased revenues due to the
opening of the new clubhouse facility at Gulfstream Park.

"EBITDA of $2.8 million in the three months ended June 30, 2006,
was relatively consistent with the prior year comparative period
of $3.0 million, but is impacted by:

   -- Southern U.S. operations above the prior year period by
      $2.0 million due to the opening of the casino facility at
      Remington Park in November 2005, which contributed
      $4.1 million in EBITDA this quarter, partially offset by
      increased costs in Remington Park's racing operations due to
      eight more live race days this quarter compared to the prior
      year and decreased revenues at Lone Star Park;

   -- European operations above the prior year by $1.8 million due
      to increased wagering revenues at MagnaBet(TM) and cost
      reduction initiatives at all European operations;

   -- partially offset by Corporate office below the prior year
      period by $2.9 million due to severance costs and increased
      professional fees, stock-based compensation expense and bank
      charges; and

   -- Technology operations below the prior year period by
      $2.6 million due to adjustments recorded at XpressBet(R)
      this quarter related to asset write-offs and increased
      accruals.

"EBITDA of $28.9 million for the six months ended June 30, 2006,
increased $14.2 million or 97.4% from $14.6 million in the six
months ended June 30, 2005.  The improvement in EBITDA is
primarily a result of the same factors noted above which affected
EBITDA in the second quarter combined with improvement in our
California and Florida operations primarily due to revenue
increases as noted above.

"Net loss from continuing operations for the three months ended
June 30, 2006, was $27.4 million compared with a loss of
$17.5 million in the three months ended June 30, 2005.  The
increased net loss is due to increased interest expense on our
Gulfstream Park and Remington Park project financings and bridge
loan facility with our parent company, MI Developments Inc., and
increased depreciation expense primarily as a result of the
opening of the new clubhouse facility at Gulfstream Park in the
first quarter of 2006 and the opening of the Remington Park casino
facility in November 2005.

"Net loss from continuing operations in the six months ended
June 30, 2006, of $25.3 million increased from a loss of
$22.3 million in the six months ended June 30, 2005, as EBITDA
improvements in the period were offset by increased interest and
depreciation for reasons noted above.

"In the three months ended June 30, 2006, cash used in operations
before changes in non-cash working capital was $10.5 million,
compared with $8.2 million in the three months ended June 30,
2005, primarily due to the increased net loss in the current year
period, partially offset by an increase in items not involving
current cash flows.

"Total cash used in investment activities during the three months
ended June 30, 2006, was $23.3 million, which included real estate
property, fixed and other asset additions of $24.7 million,
partially offset by proceeds on the sale of real estate properties
and fixed assets of $1.4 million.  Total cash provided from
financing activities in the three months ended June 30, 2006, was
$9.9 million, which included $18.4 million of cash proceeds
received from long-term debt with our parent and the issuance of
other long-term debt of $5.2 million, partially offset by
repayments of long-term debt of $6.4 million, repayment of bank
indebtedness of $5.5 million and repayment of long-term debt with
our parent of $1.8 million."

                        Sale of The Meadows

On Nov. 9, 2005, the Company announced that it had entered into a
share purchase agreement with PA Meadows, LLC, and a fund managed
by Oaktree Capital Management, LLC, providing for the acquisition
by Millenium-Oaktree of all of the outstanding shares of the
Company's wholly-owned subsidiaries through which the Company
currently owns and operates The Meadows, a standardbred racetrack
in Pennsylvania.

The share purchase agreement was amended on July 26, 2006, to
reflect the issuance of two notes representing the purchase price
in the amounts of $175.0 million and $25.0 million.

The First Note will be repaid within 35 days of the earlier of the
approval of the issuance of the gaming license provided that
Millenium-Oaktree's lenders are reasonably satisfied with the
conditions imposed by the Pennsylvania Gaming Control Board or
issuance of the gaming license.

At the time the First Note is repaid, the Second Note, which
secures the holdback amount, will be replaced with a letter of
credit or corporate guaranty.

Funds received on the repayment of the First Note will be used to
repay the bridge loan with the Company's parent, MI Developments
Inc., which matures on Dec. 5, 2006.

Funds received on repayment of the First Note will also be used to
repay, in part, the Company's senior secured credit facility,
which matures on Nov. 6, 2006, unless further extended with the
consent of both parties.

Although, the Company expects Millenium-Oaktree to receive
approval of the issuance of the gaming license and repay the First
Note before the end of October 2006, there is still uncertainty as
to the timing of approval of the issuance of a gaming license,
which is largely dependant on the applicable Pennsylvania
regulatory approval process.

                        Going Concern Doubt

Management said the Company's ability to continue as a going
concern is in substantial doubt because it is dependent on the
Company generating cash flows that are adequate to sustain the
operations of the business and maintain its obligations with
respect to secured and unsecured creditors, neither of which is
assured.

The Company is also continuing to pursue other funding sources in
connection with its recapitalization plan, which may include
further asset sales, partnerships and raising equity.

Magna Entertainment Corp. (NASDAQ: MECA; TSX: MEC.A) --
http://www.magnaentertainment.com/-- North America's number one
owner and operator of horse racetracks, based on revenues,
acquires, develops, and operates horse racetracks and related
casino and pari-mutuel wagering operations, including off-track
betting facilities.  Additionally, MEC owns and operates
XpressBet(R), a national Internet and telephone account wagering
system, and Horse Racing TV(TM), a 24-hour horse racing television
network.


METROMEDIA INT'L: Delays Filing of 2006 Second Quarter Form 10-Q
-----------------------------------------------------------------
Metromedia International Group, Inc. disclosed that it won't be
able to timely file its quarterly report on Form 10-Q for the
fiscal quarter ended June 30, 2006.

The Company says that the filing of its:

    * Annual Report on Form 10-K for the fiscal year ended
      December 31, 2004,

    * Quarterly Report on Form 10-Q for the fiscal quarters
      ended March 31, June 30, and September 30, 2005,

    * Annual Report on Form 10-K for the fiscal year ended
      December 31, 2005, and

    * Quarterly Report on Form 10-Q for the fiscal quarter ended
      March 31, 2006,

    * along with the Company's completion of its work effort
      for compliance with Section 404, "Management Assessment of
      Internal Controls" of the Sarbanes-Oxley Act of 2002 with
      respect to the filing of its 2005 Form 10-K,

are a prerequisite for the filing of the 2006 Q2 Form 10-Q.

The Company discloses that it can't predict when it will file the
reports.

Based in Charlotte, North Carolina, Metromedia International Group
(PINK SHEETS: MTRM-Common Stock and MTRMP-Preferred Stock)
-- http://www.metromedia-group.com/-- through its subsidiary,
Metromedia International Telecommunications, owns interests in
telecom and cable TV operations in Russia, Georgia, and elsewhere
in Eastern Europe.

The Company's core businesses includes Magticom, Ltd., the leading
mobile telephony operator in Tbilisi, Georgia, and Telecom
Georgia, a well-positioned Georgian long distance telephony
operator.

                         *     *     *

Moody's Investors Service has placed Metromedia's subordinated
debt rating at B3 and junior subordinated debt rating at B2.


METROMEDIA INT'L: Postpones Reporting of Magticom's Financials
--------------------------------------------------------------
Metromedia International Group, Inc., has elected to postpone
issuance of preliminary financial results, through December 31,
2005, for its Magticom business venture.

The Company remains committed to releasing preliminary prior
period Magticom financial results as soon as all related material
information can be disclosed in suitable detail and presently
expects such information release will be possible before the end
of September 2006.  Furthermore, the Company does not intend
making further public comment on these matters until a full and
comprehensive statement can be released.

Based in Charlotte, North Carolina, Metromedia International Group
(PINK SHEETS: MTRM-Common Stock and MTRMP-Preferred Stock)
-- http://www.metromedia-group.com/-- through its subsidiary,
Metromedia International Telecommunications, owns interests in
telecom and cable TV operations in Russia, Georgia, and elsewhere
in Eastern Europe.

The Company's core businesses includes Magticom, Ltd., the leading
mobile telephony operator in Tbilisi, Georgia, and Telecom
Georgia, a well-positioned Georgian long distance telephony
operator.

                         *     *     *

Moody's Investors Service has placed Metromedia's subordinated
debt rating at B3 and junior subordinated debt rating at B2.


MIRANT: Asset Recovery Agrees to Keep BofA's Info Confidential
--------------------------------------------------------------
MC Asset Recovery, LLC -- a successor-in-interest to Mirant Corp.,
and its debtor-affiliates -- on one hand, and Bank of America and
Banc of America Securities, LLC, on the other hand, have reached
an agreement to protect the confidentiality and use of the Banks'
information.

"Confidential Information" means any type or classification of
documents, electronic or digital records, information, or
materials produced in response to MCAR discovery requests to Bank
of America that is designated as "Confidential."

Among other things, the parties agree that:

    (a) MCAR must notify Toby L. Gerber of Fulbright & Jaworski
        L.L.P., Bank of America's counsel, of any intended
        disclosure and a specific description of the Confidential
        Information to be provided in any MCAR Action in which the
        Banks are not parties, or are not parties at the time of
        the intended disclosure; and

    (b) If the Bank of America timely objects, the Confidential
        Information will be filed under seal, otherwise the
        opportunity to object is deemed waived.

As reported in the Troubled Company Reporter on May 30, 2006,
prior to confirmation of the Debtors' plan of reorganization filed
by, the Debtors undertook an investigation of potential causes of
action against, among others, Bank of America.

Mirant's investigation included potential claims against Bank of
America either through affirmative acts or omissions for
avoidance, breach of fiduciary duty, aiding and abetting breach
of fiduciary duty, negligence, breach of professional duties, and
breach of statutory duties.

The Avoidance Action is based on a Credit Agreement dated as of
May 22, 2000, entered into by Mirant's predecessor-in-interest,
Southern Energy, Inc., with Bank of America, as agent.  Under the
Credit Agreement, Bank of America has a commitment, as an initial
lender, totaling $550,000,000 -- the 2000 Dividend Facility.

On May 26, 2000, Mirant transferred $450,000,000 of the
$538,000,000 initial borrowing to The Southern Company from the
2000 Dividend Facility.  On October 2, 2000, Mirant repaid
$450,000,000 to Bank of America from the proceeds of Mirant's
initial public offering.

On July 13, 2005, Bank of America entered into a Stipulated
Tolling Agreement with Mirant that tolled the statute of
limitations while Mirant continued its investigation of potential
claims against Bank of America.

The Original Stipulation was set to expire on January 13, 2006,
but Bank of America and MC Asset Recovery, LLC, entered into an
Amended Stipulation extending the toll to July 13, 2006.

In connection with the investigation, MCAR asks the Court to
direct Bank of America, N.A., and Banc of America Securities LLC,
to produce for inspection and copying, certain documents not
later than May 22, 2006, at the offices of Forshey & Prostok,
L.L.P.

Mr. Prostok asserts that MCAR's request for examination of Bank
of America is within the scope of Rule 2004 of the Federal Rules
of Bankruptcy Procedure and Local Bankruptcy Rule 2004.

Headquartered in Atlanta, Georgia, Mirant Corporation (NYSE: MIR)
-- http://www.mirant.com/-- is an 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 Jan. 3, 2006.  Thomas E. Lauria, Esq., at White & Case
LLP, represented the Debtors in their successful restructuring.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
The Debtors emerged from bankruptcy on Jan. 3, 2006.  (Mirant
Bankruptcy News, Issue No. 103; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)

                           *     *     *

As reported in the Troubled Company Reporter on July 17, 2006,
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC.  The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed.  Additionally, Mirant's Speculative Grade Liquidity
rating was revised to SGL-2 from SGL-1.  The rating outlook is
stable for Mirant, MNA, MAG, and MIRMA.

Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2.  Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1.  Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.

As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock and
sell its Philippine and Caribbean assets.

Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating and
Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the Pass-
through certificates' 'BB+/Recovery Rating RR1'.

Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating, Senior
secured term loan's 'BB/RR1' rating, and Senior unsecured notes'
'BB-/RR1' rating on Rating Watch Negative.  Mirant Americas
Generation, LLC's Issuer Default Rating of 'B+' and Senior
unsecured notes' 'B/RR5' rating was included as well.

Standard & Poor's Ratings Services also placed the 'B+' corporate
credit ratings on Mirant Corp. and its subsidiaries, Mirant North
American LLC, Mirant Americas Generating LLC, and Mirant Mid-
Atlantic LLC, on CreditWatch with negative implications.


MOBILE TOOL: Court Approves Settlement with Sifa and Lupe Tuiaki
----------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for
the District of Delaware approved a settlement agreement among
Montague S. Claybrook, the chapter 7 trustee liquidating the
estates of Mobile Tool International, Inc., and its
debtor-affiliates and Sifa and Lupe Tuiaki.

As reported in the Troubled Company Reporter on July 19, 2006,
on Sept. 5, 2003, Sifa and Lupe Tuiaki filed a complaint against,
among other defendants, one or more of the Debtors in the San
Francisco County Superior Court, Civil Action No. CG-03-419761,
Donna L. Harris, Esq., at Cross & Simon, LLC, in Wilmington,
Delaware, told the Court.

The Claimants alleged to have sustained significant and disabling
personal injuries on or about May 1, 2002, purportedly caused by
the Debtors and the other defendants.

On Jan. 13, 2004, the Claimants filed claim nos. 1276 and 1277 and
on June 8, 2004, the Claimants filed claim nos. 1515 and 1516 in
the Debtors' bankruptcy cases asserting prepetition claims in the
amount of several million dollars related to the alleged personal
injuries sustained.

After counseled negotiations, the Claimants have agreed to resolve
the Claims pursuant to these terms:

   (a) The Claimants will have an allowed unsecured prepetition
       claim against the Debtors in the amount of $250,000;

   (b) The Claimants will receive a total combined payment of
       $450,000 from the Debtors' insurer and the other named
       defendants in the Litigation.  No part of that payment will
       be obtained from the Debtors' estates;

   (c) The Claimants will give the Debtors a full, general release
       of all other claims against the estates.

                        About Mobile Tool

Mobile Tool International, Inc., is an employee-owned manufacturer
and distributor of equipment, including aerial lifts, digger
derricks and pressurization and monitoring systems, for the
telecommunications, CATV, electric utility and construction
industries.

The Company filed for chapter 11 protection on September 30, 2002
(Bankr. Del. Case No. 02-12826). Steven M. Yoder, Esq., and
Christopher A. Ward, Esq., at The Bayard Firm represent the
Debtors in their restructuring efforts. When the Debtors filed for
protection from its creditors, it listed $65,250,000 in total
assets and $46,580,000 in total debts.

The Court converted the chapter 11 cases to cases under chapter 7
effective Feb. 27, 2004.  Shortly after that, the Court appointed
Montague S. Claybrook as Chapter 7 Trustee.  Elizabeth Evans,
Esq., and Christopher Page Simon, Esq., at Cross & Simon, LLC,
represents the Chapter 7 Trustee.


NATIONAL CENTURY: Court OKs Pact Expunging Epstein Becker's Claims
------------------------------------------------------------------
Epstein, Becker & Green, P.C., filed Claim Nos. 202, 203, 350 and
351 in connection with legal opinions it provided to National
Century Financial Enterprises, Inc., and its debtor-affiliates for
various financing transactions.  The Unencumbered Assets Trust and
the VI/XII Collateral Trust asked the Court to disallow the
Claims.

Epstein Becker contested the disallowance.

Epstein Becker was subsequently named as a defendant in an
adversary proceeding captioned "Sam J. Alberts, Trustee for the
DCHC Liquidating Trust v. Paul Tuft, et al." pending in the U.S
Bankruptcy Court for the District of Columbia.  In the DCHC
Lawsuit, causes of action are asserted against Epstein Becker,
some with respect to the transactions related to the Opinions.

In a Court-approved stipulation, the Trusts and Epstein Becker
agree that:

    (1) The Claims are expunged, without prejudice to Epstein
        Becker's rights to seek reconsideration of the
        disallowance of its Claims for cause pursuant to Section
        502(j) of the Bankruptcy Code;

    (2) Entry of a monetary judgment against Epstein Becker in the
        DCHC Lawsuit will constitute cause for reconsideration of
        the Claims pursuant to Section 502(j).  However, the
        Trusts' right upon reconsideration to object to the Claims
        on any legal or factual grounds is expressly preserved.
        Any request by Epstein Becker for reconsideration of the
        disallowance of its Claims will be through a motion with
        the Court;

    (3) The stipulation fully and finally resolves the Epstein
        Becker Claims and any related liabilities or claims
        against the Debtors, the Trusts or their property;

    (4) The Unencumbered Trust will not be required to reserve
        from distributions to its beneficiaries any funds for
        possible future distributions to Epstein Becker on account
        of any existing or future claims, including any
        distribution amounts that might result from
        reconsideration and allowance of the Claims; and

    (5) If the Epstein Becker Claims are allowed upon
        reconsideration:

        (a) the Unencumbered Trust will not be required to seek
            disgorgement of any previous distributions made to
            its beneficiaries;

        (b) Epstein Becker will receive from any funds available
            for distribution from the Unencumbered Trust an
            amount in respect to its allowed claim that is
            proportionate to the amounts received by other
            beneficiaries of the Unencumbered Trust in respect of
            their allowed claims; and

        (c) Epstein Becker will share proportionately in any
            future distributions by the Unencumbered Trust to its
            beneficiaries.

Headquartered in Dublin, Ohio, National Century Financial
Enterprises, Inc. -- http://www.ncfe.com/-- through the CSFB
Claims Trust, the Litigation Trust, the VI/XII Collateral Trust,
and the Unencumbered Assets Trust, is in the midst of liquidating
estate assets.  The Company filed for Chapter 11 protection on
November 18, 2002 (Bankr. S.D. Ohio Case No. 02-65235).  The Court
confirmed the Debtors' Fourth Amended Plan of Liquidation on
April 16, 2004.  Paul E. Harner, Esq., at Jones Day, represents
the Debtors. (National Century Bankruptcy News, Issue No. 65;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


NATIONAL CENTURY: LTC Entities' Lawsuit Stayed Until August 28
-------------------------------------------------------------
The Honorable Donald E. Calhoun, Jr., of the U.S. Bankruptcy Court
for the Southern District of Ohio, Eastern Division, previously
ruled that all matters pending before the Court in the Adversary
Proceeding are stayed for a period of 45 days through, and
including, July 28, 2006.

Subsequently, Long Term Care Management, Inc., Quality Long Term
Care Management, Inc., and Quality Long Term Care, Inc., sought
and obtained the Court's approval to further extend the Period of
Stay to, and including, Aug. 28, 2006.  VI/XII Collateral Trust
and FTI Consulting, Inc., agreed to the extension.

Yvette A. Cox, Esq., at Bailey Cavalier, in Columbus, Ohio,
relates that over the past month, the parties have been engaging
in settlement discussions and exchanging financial and other
information in connection with the negotiations.

The parties require additional time to negotiate the terms of a
settlement, Ms. Cox explains.

If the Period of Stay expires without being extended by agreement
of the parties, the LTC Entities will have an additional two-week
extension of time through and including Sept. 11, 2006, to move or
otherwise respond to the VI/XII Collateral Trust and FTI's Summary
Judgment Motion, Judge Calhoun says.

As reported in the Troubled Company Reporter on June 26, 2006,
VI/XII Collateral Trust and FTI Consulting, Inc., asked the U.S.
Bankruptcy Court for the Southern District of Ohio to issue a
summary judgment declaring that:

    (1) Long Term Care Management, Inc., Quality Long Term Care
        Management, Inc., and Quality Long Term Care, Inc., are
        liable for the $1,130,000 currently owed on NPF XII,
        Inc.'s allowed claims in the LTC Entities' Chapter 11 plan
        of reorganization -- the Settlement Obligation;

    (2) The LTC Entities should turnover all amounts currently
        mature and due under the Settlement Obligation;

    (3) The LTC Entities breached the LTC Plan by failing to make
        payments they admittedly owe to the Trust; and

    (4) The LTC Entities' failure to make payments under the
        Settlement Obligation is in contempt of the Confirmation
        Order and the Enforcement Order in the Chapter 11 cases of
        National Century Finance Enterprises, Inc.

Besides the summary judgment request, the other matter currently
pending before the Court in the Adversary Proceeding is the LTC
Entities' request to dismiss the complaint for lack of subject
matter jurisdiction.

Headquartered in Dublin, Ohio, National Century Financial
Enterprises, Inc. -- http://www.ncfe.com/-- through the CSFB
Claims Trust, the Litigation Trust, the VI/XII Collateral Trust,
and the Unencumbered Assets Trust, is in the midst of liquidating
estate assets.  The Company filed for Chapter 11 protection on
November 18, 2002 (Bankr. S.D. Ohio Case No. 02-65235).  The Court
confirmed the Debtors' Fourth Amended Plan of Liquidation on
April 16, 2004.  Paul E. Harner, Esq., at Jones Day, represents
the Debtors. (National Century Bankruptcy News, Issue No. 65;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


NORTH AMERICAN: June 30 Balance Sheet Upside-Down by $10.9 Million
------------------------------------------------------------------
North American Technologies Group, Inc., filed its financial
results for the second quarter ended June 25, 2006, with the
Securities and Exchange Commission on Aug. 9, 2006.

For the three months ended June 25, 2006, the Company incurred a
$4.2 million net loss on $4.4 million of net revenues, compared to
a $3.4 million net loss on $1.4 million of net revenues in 2005.

At June 30, 2006, the Company's balance sheet showed $17.9 million
in total assets and $28.9 million in total liabilities, resulting
in a $10.9 million stockholders' deficit.

The Company's June 30 balance sheet also showed strained liquidity
with $4.8 million in total current assets available to pay
$17.3 million in total current liabilities coming due within the
next 12 months.

A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?fd4

North American Technologies Group, Inc. -- http://www.natk.com/--  
through its TieTek subsidiary manufactures and sells composite
railroad crosstie known as TieTek(TM) made from recycled composite
materials that is a direct substitute for wood crossties, but with
a longer life and with several environmental advantages.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on June 5, 2006, Ham,
Langston & Brezina, LLP, in Houston, Texas, raised substantial
doubt about North American Technologies Group, Inc.'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 recurring losses from
operations and debt service and working capital requirements that
reach beyond its current available cash.


NORTHWEST AIRLINES: Court Allows Flight Attendants to Hold Strike
-----------------------------------------------------------------
The Northwest Airlines flight attendants' right to strike was
upheld by the U.S. Bankruptcy Court for the Southern District of
New York on Aug. 17, 2006.

In a decision issued by Judge Allan L. Gropper, the court denied
the airline's request for an injunction that would have prevented
the Northwest flight attendants, represented by the Association of
Flight Attendants-CWA, from striking in response to the company's
rejection of their collective bargaining agreement.

"... we sent a strong message to corporate America: you cannot
keep taking from your employees without a fight," said Mollie
Reiley, Interim Master Executive Council President.  "Now,
Northwest management has one more chance.  They have the choice to
either set greed aside for once and agree to a fair and equitable
contract, or they will face CHAOS(TM).  Management needs to reduce
their demands and do it in a hurry."

CHAOS, or Create Havoc Around Our System(TM), is AFA-CWA's
trademarked strategy of targeted work actions using random,
unannounced strikes.  As upheld by the bankruptcy court, any
unilateral change in a contract triggers a right to strike under
the Railway Labor Act.

On July 31, 2006, the company imposed terms outlined in a
tentative agreement that was overwhelmingly rejected by the flight
attendants earlier.  The terms consisted of over forty percent
reductions in salary and benefits.  AFA-CWA issued the company
notice of their intent to exercise their right to strike as early
as Aug. 25, 2006, at 9:01 pm CDT.

"Today's ruling is a victory for the Northwest flight attendants,
and for all working people," said AFA-CWA General Counsel David
Borer.  "In upholding the right to strike, the court recognized
that bankruptcy is not a free ride for rich executives.  This
levels the playing field."

For over 60 years, the Association of Flight Attendants --
http://www.afanet.org/-- has been serving as the voice for flight
attendants in the workplace, in the aviation industry, in the
media and on Capitol Hill.  More than 55,000 flight attendants at
20 airlines come together to form AFA-CWA, the world's largest
flight attendant union.  AFA is part of the 700,000-member strong
Communications Workers of America, AFL-CIO.

                     About Northwest Airlines

Northwest Airlines Corp. (OTC: NWACQ) -- http://www.nwa.com/
-- is the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq.,
at Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
The Official Committee of Unsecured Creditors has retained Akin
Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the
Debtors' chapter 11 cases.  When the Debtors filed for protection
from their creditors, they listed $14.4 billion in total assets
and $17.9 billion in total debts.


NORTHWEST AIRLINES: To Appeal Court's Decision on Strike Sanction
-----------------------------------------------------------------
The U.S. Bankruptcy Court Judge Allan Gropper denied Northwest
Airlines' request for a preliminary injunction to prevent a
threatened strike or work action by the Association of Flight
Attendants-CWA.

At the same time, Judge Gropper denied the flight attendants
union's request that Northwest be required to implement the terms
and conditions of the failed July 17 tentative agreement with the
AFA and he endorsed Northwest's decision to implement the terms of
its March 1 tentative agreement with the flight attendants' former
union, the Professional Flight Attendants Association.

Commenting on the judge's decision, Doug Steenland, Northwest
president and chief executive officer, said, "While we are
disappointed with Judge Gropper's ruling and will appeal it, we
remain committed to continuing to serve our customers
professionally and transporting them to their destinations safely
and reliably.  Our customers can continue to book Northwest with
confidence."

Northwest said it will appeal Judge Gropper's denial of the
request for a preliminary injunction to the United States District
Court for the Southern District of New York.

The company said that it has a range of contingency options to
respond to any AFA work disruption and it will take all necessary
actions to continue to operate its normal flight schedule.

Commenting on future discussions with Northwest flight attendants,
Steenland added, "Northwest's continuing goal is to reach
consensual agreements with all of its unions, including AFA.
Notwithstanding the current court proceedings between the two
parties, we remain committed to working with AFA to reach a
consensual ratified collective bargaining agreement that generates
the required $195 million in annual cost savings.  We believe we
are on common ground with AFA and our flight attendants on this
commitment.

"We believe we also share a common interest with AFA and our
flight attendants in restoring Northwest to economic good health.
A strong, focused NWA will provide stable employment, meaningful
careers, growth opportunities and a secure retirement for our
employees.  Because of our shared interest in these issues, AFA
and Northwest were able to work together to bring about successful
pension reform."

Last week, Northwest asked the Bankruptcy Court to grant the
preliminary injunction after AFA notified the company that it
might begin work actions against the airline as early as Aug. 15,
2006.  The union later notified Northwest that it had extended the
date for the start of possible work actions until Aug. 25, 2006.
The AFA notifications followed the flight attendants' rejection of
a tentative contract agreement that NWA had negotiated with AFA
and that would have met the targeted $195 million in annual labor
cost savings.  AFA endorsed that tentative agreement and
recommended that its members vote in favor of it.

As a result of the contract rejection, and in accordance with a
previous decision of the Bankruptcy Court, Northwest implemented
contract terms and conditions for its flight attendants that met
the required $195 million of annual labor cost savings for that
group.

Northwest has reached agreements on permanent wage and benefit
reduction agreements with the Air Line Pilots Association, the
International Association of Machinists and Aerospace Workers,
Aircraft Technical Support Association, the Transport Workers
Union of America, and the Northwest Airlines Meteorologists
Association.  Two rounds of salaried and management employee pay
and benefit cuts have also been instituted and the needed aircraft
maintenance employee labor cost savings have been achieved, which
allowed Northwest to meet its goal of achieving $1.4 billion in
annual labor savings.

Since beginning its restructuring process in September of last
year, Northwest has remained focused on its plan to realize
$2.5 billion in annual business improvements in order to return
the company to profitability on a sustained basis.  The
restructuring plan continues to be centered on three goals:
resizing and optimization of the airline's fleet to better serve
Northwest's markets; realizing competitive labor and non-labor
costs; and restructuring and recapitalization of the airline's
balance sheet.

"In recent weeks, Northwest has reached two significant milestones
which will further advance our restructuring goals: first, through
a collaborative effort with Northwest Airlines employees and our
union leaders, Congress passed pension legislation which the
President signed, enabling Northwest to preserve its frozen
defined benefit pension plans and second, we have reached our
targeted labor cost savings of $1.4 billion," Mr. Steenland
concluded.

                     About Northwest Airlines

Northwest Airlines Corp. (OTC: NWACQ) -- http://www.nwa.com/
-- is the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq.,
at Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
The Official Committee of Unsecured Creditors has retained Akin
Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the
Debtors' chapter 11 cases.  When the Debtors filed for protection
from their creditors, they listed $14.4 billion in total assets
and $17.9 billion in total debts.


OCA INC: Hires Postlethwaite & Netterville as Accountants
---------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
gave OCA, Inc., and its debtor-affiliates permission to retain
Postlethwaite & Netterville, as its accountants.

Postlethwaite & Netterville will:

   a) prepare cash flow forecasts as needed;

   b) assist the Debtors in closing their books each month;

   c) assist the Debtors with issuance of the monthly financial
      statements;

   d) review the completed financial statements with the Debtors'
      management;

   e) conduct general ledger account reconciliations (excluding
      bank reconciliation);

   f) prepare schedules for yearly financial audits;

   g) assist in the preparation of audited financial statements;

   h) provide any other advice and assistance as may be requested
      from time to time by the Debtors; and

   i) assist in reviewing records and analyzing data in connection
      with the litigation which is pending and anticipated in
      connection with enforcing the Debtors' rights;

Postlethwaite & Netterville holds an unsecured claim of $44,759
and has waived that claim.

Albert J. Richard, III, a Postlethwaite & Netterville director,
discloses that the firm's professionals bill:

          Designation               Hourly Rate
          -----------               -----------
          Director/Partner          $170 - $220
          Associate                 $130 - $170
          Manager                   $120 - $140
          Senior Accountant          $90 - $120
          Staff                      $70 - $95

Mr. Richard assures the Court that his firm does not represent any
interest adverse to the Debtor or its estate.

Based in Metairie, Louisiana, OCA, Inc. -- http://www.ocai.com/
-- provides a full range of operational, purchasing, financial,
marketing, administrative and other business services, as well
as capital and proprietary information systems to approximately
200 orthodontic and dental practices representing approximately
almost 400 offices.  The Debtor's client practices provide
treatment to patients throughout the United States and in Japan,
Mexico, Spain, Brazil and Puerto Rico.

The Debtor and its debtor-affiliates filed for Chapter 11
protection on March 14, 2006 (Bankr. E.D. La. Case No.
06-10179).  Three debtor-affiliates also filed for bankruptcy
protection on June 1, 2006 (Bankr. E.D. La. Case No. 06-10503).
William H. Patrick, III, Esq., at Heller Draper Hayden Patrick &
Horn, LLC, represents the Debtors.  Patrick S. Garrity, Esq., and
William E. Steffes, Esq., at Steffes Vingiello & McKenzie LLC
represent the Official Committee of Unsecured Creditors.  Carmen
H. Lonstein, Esq., at Bell Boyd & Lloyd LLC and Robin B. Cheatham,
Esq., at Adams and Reese LLP represent the Official Committee of
Equity Security Holders.  When the Debtors filed for protection
from their creditors, they listed $545,220,000 in total assets and
$196,337,000 in total debts.


OCA INC: Equity Panel Hires Imperial Capital as Financial Advisor
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
allowed the Official Committee of Equity Security Holders
appointed in OCA, Inc., and its debtor-affiliates' chapter 11
cases, to employ Imperial Capital, LLC, as its financial advisor.

Imperial Capital is expected to:

   a) analyze the Debtors' business, operations, properties,
      financial condition, competition, forecast, prospects and
      management;

   b) perform financial valuations of the Debtors' ongoing
      operations;

   c) assist the Equity Committee in developing, evaluating,
      structuring and negotiating the terms and conditions of any
      plan of reorganization, including the value of securities,
      if any, that may be issued to the equity holders under a
      plan of reorganization;

   d) analyze potential divestitures by the Debtor; and

   e) provide other financial advisory services with respect to
      the Debtors' financial issues as may from time to time be
      agreed upon between the Equity Committee and the firm.

Tim O'Connor, an Imperial Capital member, discloses the firm's
professionals bill:

          Designation                Hourly Rate
          -----------                -----------
          Managing Directors            $800
          Sr. Vice Presidents           $600
          Vice Presidents               $550
          Associates                    $450
          Analysts                      $350

Mr. Connor adds that the firm will receive a transaction fee
greater than:

    i) $300,000 or

   ii) 1.0% of the new money contributed by the members of the
       Committee or their affiliates pursuant to the
       restructuring, payable in cash.

Mr. Connor assures the Court that his firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.

Based in Metairie, Louisiana, OCA, Inc. -- http://www.ocai.com/
-- provides a full range of operational, purchasing, financial,
marketing, administrative and other business services, as well
as capital and proprietary information systems to approximately
200 orthodontic and dental practices representing approximately
almost 400 offices.  The Debtor's client practices provide
treatment to patients throughout the United States and in Japan,
Mexico, Spain, Brazil and Puerto Rico.

The Debtor and its debtor-affiliates filed for Chapter 11
protection on March 14, 2006 (Bankr. E.D. La. Case No.
06-10179).  Three debtor-affiliates also filed for bankruptcy
protection on June 1, 2006 (Bankr. E.D. La. Case No. 06-10503).
William H. Patrick, III, Esq., at Heller Draper Hayden Patrick &
Horn, LLC, represents the Debtors.  Patrick S. Garrity, Esq., and
William E. Steffes, Esq., at Steffes Vingiello & McKenzie LLC
represent the Official Committee of Unsecured Creditors.  Carmen
H. Lonstein, Esq., at Bell Boyd & Lloyd LLC and Robin B. Cheatham,
Esq., at Adams and Reese LLP represent the Official Committee of
Equity Security Holders.  When the Debtors filed for protection
from their creditors, they listed $545,220,000 in total assets and
$196,337,000 in total debts.


ONE TO ONE: Court Sets Plan Confirmation Hearing on September 11
----------------------------------------------------------------
The Hon. Joan N. Feeney of the U.S. Bankruptcy Court for the
District of Massachusetts approved the Amended Disclosure
Statement explaining the First Amended Chapter 11 Plan of
Liquidation filed by One to One Interactive, LLC.

The Court determined that the Amended Disclosure Statement
contained adequate information -- the right amount of the right
kind necessary for creditors to make informed decisions -- as
required by Section 1125 of the Bankruptcy Code.

Judge Feeney will convene a hearing on Sept. 11, 2006, at 11:00
a.m. to consider confirmation of the Debtors' Amended Chapter 11
Plan of Liquidation.

Objections to confirmation of the Plan must be filed with the
Court by Aug. 31, 2006, at 5:00 p.m., and served on:

       i) Counsel to the Debtors

          A. Davis Whitesell, Esq.
          Cohn Whitesell & Goldberg LLP
          101 Arch Street, Suite 1605
          Boston, Massachusetts 02110

      ii) Counsel to the Creditors' Committee

          William R. Moorman, Jr., Esq.
          Brendan C. Recuperpo, Esq.
          Craig and Macauley, P.C.
          Federal Reserve Plaza
          600 Atlantic Ave.
          Boston, Massachusetts 02210

     iii) Office of the U.S. Trustee
          Paula Bachtell, Esq.
          10 Causeway St., Rm. 1184
          Boston, Massachusetts 02222

                       Overview of the Plan

The Amended Plan provides for a Liquidating Agent to assume
possession and control of the Debtor's remaining assets --
including causes of action under the Bankruptcy Code.

The Liquidating Agent will:

   -- administer those assets for the benefit of the Debtor's
      creditors,

   -- object to claims that appear to be invalid or overstated,

   -- prosecute objections to claims filed by the Debtor or the
      Liquidating Agent prior to confirmation of the Plan, and

   -- make distributions to creditors on account of their allowed
      claims against the Debtor.

The Debtor has ceased all business operations and has liquidated
virtually all of its property.  The Debtor's principal asset is
approximately $900,000 in cash as of April 30, 2006.

A copy of the Debtor's Amended Disclosure Statement is available
for a fee at:

    http://www.researcharchives.com/bin/download?id=060817193745

                  About One to One Interactive

Headquartered in Boston, Massachusetts, One to One Interactive,
LLC -- http://www.onetooneinteractive.com/-- provides Internet
marketing services and offers marketing, creative and technology
services to companies in industries like financial services, life
sciences, media, telecommunications and technology.  The Debtor
filed for chapter 11 protection on March 18, 2005 (Bankr. D. Mass.
Case No. 05-12083).  A. Davis Whitesell, Esq., at Cohn &
Whitesell, LLP, represents the Debtor in its restructuring
process.  Brendan C. Recupero, Esq., at Craig and Macauley PC
reprsents the Official Committee of Unsecured Creditors.  When the
Debtor filed for protection from its creditors, it estimated
assets and debts from $1 million to $10 million.


PAETEC COMMS: US LEC Merger Prompts Moody's To Review Rating
------------------------------------------------------------
Moody's Investors Service placed Paetec Communications Inc.'s
corporate family rating on review for possible downgrade following
the company's announcement that it is acquiring US LEC Corp. for
about $560 million, net of cash.  The acquisition will consist of
an exchange of common stock, valued at about $160 million, the
redemption of $268 million in US LEC's preferred stock and the
refinancing of $158 million in US LEC debt.

In conjunction with the transaction, Paetec is proposing a new
$850 million credit facility, which will pay for the acquisition
and refinance the $374 million of its existing debt.  Since
Paetec's existing credit facilities are expected to be refinanced
with the transaction, Moody's affirmed the bank facility ratings,
which will be withdrawn at closing.

In a related action, Moody's affirmed US LEC's ratings.  At the
closing of the transaction, the US LEC ratings will be withdrawn.

The potential financing will increase Paetec's pro forma adjusted
leverage to about 5.7x at closing, from 4.8x at June 30, 2006,
thereby pressuring the ratings downwards. The ratings action
reflects the increased financial stress placed on the company's
capital structure, specifically, the increase in leverage and the
impact on free cash flow during the integration period.  Moody's
does however, positively view the company's enhanced operating
scale in the eastern US, and the potential for EBITDA growth
driven by merger synergies.

The review will focus on:

   1) the impact of the new financing on Paetec's capital
      structure;

   2) the company's strategy for successfully integrating US
      LEC's operations and generating meaningful cost reductions;

   3) the company's ability to resume generating sustainable free
      cash flow, in light of the US LEC integration; and,

   4) Paetec's ongoing acquisition strategy and its potential
      impact on the company's capital structure.

Moody's took these ratings actions:

Issuer: Paetec Communications, Inc.

   * Corporate Family Rating -- Rating Under Review for Possible
     Downgrade from B2

   * Senior Secured Revolving Credit Facility, Affirmed B1

   * 1st Lien Senior Secured Term Loan, Affirmed B1

   * 2nd Lien Senior Secured Term Loan, Affirmed B3

Issuer: US LEC Corp.

   * Corporate Family Rating Affirmed Caa1
   * 2nd Lien Senior Secured Notes Affirmed B3
   * Speculative Grade Liquidity Affirmed SGL-2

Paetec, headquartered in Fairport, New York, is a CLEC and
generated revenues of $509 million in 2005. US LEC, headquartered
in Charlotte, North Carolina, is a CLEC and generated revenues of
$388 million in 2005.


PAN AM: Creditors to Get $30 Million from Libyan Suit Settlement
----------------------------------------------------------------
A final distribution will be made by the end of the year to Pan Am
World Airways' administrative creditors, including more than
15,000 former employees.  Pan Am said that the additional
distribution of $30 million will be made possible by proceeds from
a law suit settlement with the Government of Libya stemming from
the destruction of the airline's Flight 103 over Lockerbie,
Scotland on Dec. 21, 1988.

Pan Am originally filed for bankruptcy relief on Jan. 8, 1991.
The airline ceased operations on Dec. 4, 1991.  Among the reasons
leading to Pan Am's demise was a severe decline in international
air traffic in the aftermath of the Libyans' terrorist bombing of
Flight 103.

After the bombing of its aircraft, Pan Am sought to recover
damages from the Libyan Government, Libya's national airline and
two Libyan agents.  The civil action was stayed while Scottish
authorities pursued criminal charges against the two individuals.

In 2004, the conviction of one of the individual defendants by a
Scottish Court sitting in The Hague became final.  Following that
conviction, the civil suit was able to proceed.  The pressure of
that action, coupled with Libya's shift in geo-economic
strategies, enabled Pan Am to negotiate a settlement with the
Libyan authorities.  That settlement provided the funds for this
final distribution.

The distribution will be made to all eligible administrative
creditors, including former employees, pursuant to procedures
approved by the Bankruptcy Court in New York on July 6, 2006.
Distribution checks are expected to be mailed beginning in
December 2006.

Pursuant to the approved distribution procedures, Pan Am has
mailed a notice of the distribution to all holders of outstanding
Allowed Administrative Claims at their last known addresses.

Persons who believe they hold an Allowed Administrative Claim but
who do not receive a mailed notice or who receive a mailed notice
as a result of it being forwarded to them at an address different
from that to which it was addressed must contact Wells Fargo Bank,
N.A., Pan Am's distribution agent, as soon as possible, and in any
event no later than Nov. 1, 2006, in order to update their contact
information.  Pursuant to the court-approved procedures for the
final distribution, Administrative Creditors who cannot be located
may forfeit their right to participate in the final distribution.

The final distribution is being made pursuant to an order of the
Bankruptcy Court dated Feb. 15, 1996 which, among other things,
established the Pan Am Liquidation Trust, transferred
substantially all of the remaining assets of Pan Am to the
Liquidation Trust, and authorized the distribution to each holder
of an Allowed Administrative Claim of an amount equal to its pro
rata share of the anticipated net recovery from the litigation
pertaining to the loss of Pan Am Flight 103.

Previous distributions to Administrative Creditors have totaled
approximately 23% of their respective claims.  It is anticipated
that the final distribution will equal not less 5% of the
remaining outstanding Administrative Claims.  Any unclaimed or
otherwise undistributed funds will be turned over to the Pan Am
Retirees' Supplemental Medical Plan.

Creditors with questions about individual claims or the final
distribution, or who wish to update their contact information,
should call Wells Fargo's toll-free service and information line
(877-813-3539) between the hours of 9:00 a.m. and 5:00 p.m.,
Eastern Daylight Time, Monday through Friday, or write to:

     Pan Am Liquidation Trust
     c/o Wells Fargo Bank, N.A.
     P.O. Box 2370
     Minneapolis, MN 55402-0370

Pan American World Airways, commonly known as Pan Am, was the
principal international airline of the United States from the
1930s until its collapse in 1991.


PEMCO AVIATION: Low Earnings Prompt Credit Facility Default
-----------------------------------------------------------
Pemco Aviation Group, Inc., disclosed that for the six months
ended June 30, 2006, it was in violation of a debt covenant
requiring the Company to achieve income before income taxes of
$1.0 million.

For the three months ended June 30, 2006, the Company reported a
net income of $445,000 while it earned $524,000 for the six months
ended June 30.

The Company says that it hasn't been able to obtain a wavier of
default and as a result, its lenders may request payment of all
debts outstanding at any time.

The Company relates that it is continuing to work with the lenders
on a waiver and an extension of the maturity date.  The Company
also has contacted other lenders about obtaining additional
financing.  The Company says that if it is unable to obtain
additional financing, extend the Credit Agreement or comply with
the covenants in the future and the lenders do not grant waivers,
the outstanding borrowings under the Credit Agreement may continue
to be immediately due and payable and certain interest rates will
increase.

                         Credit Facility

On December 16, 2002, the Company entered into a Credit Agreement
with Wachovia Bank and Compass Bank that provides for a revolving
credit facility and a term loan.

                    Credit Agreement Amendments

The Company and its primary lenders entered into a series of
amendments to the Credit Agreement dated December 16, 2002, that
affect the Revolving Credit Facility that is made available to the
Company under the Credit Agreement.

On May 7, 2004, the Company amended the Credit Agreement to
temporarily increase the Revolving Credit Facility from a
commitment of $25 million to $27 million.  On Aug. 1, 2004, the
Company amended the Credit Agreement to extend until December 31,
2004 the temporary increase of the commitment under the Revolving
Credit Facility to up to $27 million.

On Nov. 5, 2004, the Company amended the Credit Agreement to
temporarily increase the Revolving Credit Facility from a
commitment of $27 million to $33 million.  On Dec. 22, 2004, the
Company amended the Credit Agreement to extend the Revolving
Credit Facility maturity date from December 16, 2005 to April 30,
2006.

On April 30, 2005, the Company amended the Credit Agreement to
extend the $33 million Revolving Credit Facility commitment to
June 30, 2006.  On June 28, 2005, the Credit Agreement was amended
to extend the Revolving Credit Facility maturity date from April
30, 2006 to Oct. 15, 2006, and to reduce the commitment amount to
$28 million.

The Company discloses that its lenders have not extended the
maturity date further.

                        Previous Waivers

During the first and second quarters of 2005 and the fourth
quarter of 2004, the Company violated the fixed charge coverage
ratio covenant under the Revolving Credit Facility due to
quarterly losses incurred by the Company during 2005 and 2004.
As of September 30, 2005, the Company violated the adjusted
tangible net worth covenant.

On March 31, 2005, the Company obtained a waiver from the lenders
for the fixed charge coverage ratio covenant violation with
respect to the first quarter of 2005 and the fourth quarter of
2004.  The Credit Agreement was amended to revise the calculation
of the fixed charge coverage ratio for the second and third
quarters of 2005 using annualized 2005 results instead of total
results of the past four quarters and to increase the adjusted
tangible net worth covenant from approximately $30.0 million to
$33.5 million.

On August 11, 2005, the Company obtained a waiver from the lenders
for the fixed charge coverage ratio covenant violation with
respect to the second and third quarters of 2005.  The Credit
Agreement was amended to revise the calculation of the fixed
charge coverage ratio for the fourth quarter of 2005, to decrease
the required ratio of operating income to fixed charges from 1.2
to 1.0 and to increase the adjusted tangible net worth covenant
from approximately $33.5 million to $38.5 million.

As of December 31, 2005, the Company was in violation of the fixed
charge coverage ratio and the adjusted tangible net worth ratio.
The Company obtained a waiver from the lenders for all debt
covenant violations through December 31, 2005.

On February 15, 2006, the Credit Agreement was amended to
establish financial covenants for 2006.  The new covenants
established a minimum adjusted tangible net worth for each
quarter, minimum earnings before tax beginning June 30, 2006, and
a fixed charge coverage ratio for the year ending December 31,
2006.

                         Pemco Aviation

Pemco Aviation Group, Inc. -- http://www.pemcoaviationgroup.com/
--  with executive offices in Birmingham, Alabama, and facilities
in Alabama and California, performs maintenance and modification
of aircraft for the U.S. Government and for foreign and domestic
commercial customers.  The Company also provides aircraft parts
and support and engineering services, in addition to developing
and manufacturing aircraft cargo systems, rocket vehicles and
control systems, and precision components.


PEMCO AVIATION: Earns $445,000 in Quarter Ended June 30
-------------------------------------------------------
Pemco Aviation Group, Inc., reported financial results for the
quarter ended June 30, 2006, in a Form 10-Q filing with the U.S.
Securities and Exchange Commission on Aug. 14, 2006.

For the quarter ended June 30, 2006, the Company reported a net
income of $445,000 compared to a net loss of $368,000 for the same
period in 2005.  For the six months ended June 30, 2006, the
Company reported a net income of $524,000 compared to a net income
of $791,000 for the six months ended June 30, 2005.

At June 30, 2006, the Company's balance sheet showed $98,318,000
in total assets and $85,420 in total liabilities.  The Company's
June 30 balance sheet further showed a working capital deficiency
with $50,603,000 in total current assets and $69,673,000 in total
current liabilities.

Full-text copies of the Company's financial report for the quarter
ended June 30, 2006, is available for free at:

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

Pemco Aviation Group, Inc. -- http://www.pemcoaviationgroup.com/
--  with executive offices in Birmingham, Alabama, and facilities
in Alabama and California, performs maintenance and modification
of aircraft for the U.S. Government and for foreign and domestic
commercial customers.  The Company also provides aircraft parts
and support and engineering services, in addition to developing
and manufacturing aircraft cargo systems, rocket vehicles and
control systems, and precision components.


PLIANT CORP: Court Approves EPA Settlement Agreement
----------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware allowed
Pliant Corporation and its debtor-affiliates to enter into a
Settlement Agreement with the U.S. Environmental Protection
Agency.
                       EPA Investigation

EPA was conducting an ongoing investigation to determine the
parties responsible for leaving several thousand drums containing
varying hazardous and solid wastes at a waste transfer facility
located near Atlanta, Georgia.

The EPA asked the Debtors for information relating to materials
that they may have shipped to the Site.  The Debtors responded to
the EPA's request in June 2005.

The EPA found that before the Debtors filed for bankruptcy, their
Washington, Georgia facility sent numerous containers consisting
of mostly non-hazardous ink waste, ink wastewater, and some waste
oil to the Site.  The EPA identified the Debtors as one of more
than 100 potentially responsible parties for the site
contamination.

Consequently, the Debtors are potentially liable for the clean up
of the Site under the Comprehensive Environmental Response,
Compensation, and Liability Act as provided for in 42 U.S.C.
Section 9607 (2002).

The EPA asserted claims against the PRPs for past and future
costs related to the clean-up of the Site.

                           EPA Settlement

To resolve EPA's Claims, the EPA and the PRPs negotiated an
arm's-length settlement.

Under the Settlement, the EPA will:

   (i) release the Debtors for any potential liability associated
       with past costs it incurred totaling $2,600,000;

  (ii) release the Debtors for any potential liability for 54% of
       the oversight costs that non-participating PRPs may be
       required to pay; and

(iii) provide the Debtors with contribution protection from a
      claim by any party who may be sued by the EPA for the
      costs.

A full-text copy of the Settlement between the PRPs and the EPA
is available for free at http://ResearchArchives.com/t/s?e0f

Headquartered in Schaumburg, Illinois, Pliant Corporation --
http://www.pliantcorp.com/-- produces value-added film and
flexible packaging products for personal care, medical, food,
industrial and agricultural markets.  The Debtor and 10 of its
affiliates filed for chapter 11 protection on Jan. 3, 2006
(Bankr. D. Del. Lead Case No. 06-10001).  James F. Conlan, Esq.,
at Sidley Austin LLP, and Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor, represent the
Debtors in their restructuring efforts.  The Debtors tapped
McMillan Binch Mendelsohn LLP, as their Canadian bankruptcy
counsel.   The Ontario Superior Court of Justice named RSM
Richter, Inc., as the Debtors' information officer in their
restructuring proceeding under Companies Creditors Arrangement Act
in Canada.  Kenneth A. Rosen, Esq., at Lowenstein Sandler, P.C.,
serves as counsel to the Official Committee of Unsecured
Creditors.  Don A. Beskrone, Esq., at Ashby & Geddes, P.A., is
local counsel to the Creditors' Committee.  As of Sept. 30, 2005,
the company had $604,275,000 in total assets and $1,197,438,000 in
total debts.  The Debtors emerged from chapter 11 protection on
July 19, 2006 (Pliant Bankruptcy News, Issue No. 20; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


PLIANT CORP: Issues New Common Stock & New Preferred Stock
----------------------------------------------------------
The Fourth Amended Joint Plan of Reorganization of Pliant Corp.
and its debtor-affiliates provided for Pliant's issuance of new
preferred stock and new common stock as part of the
reorganization.

In a filing with the Securities and Exchange Commission, Joseph
Kwederis, senior vice president and chief financial officer of
Pliant Corporation, reports that pursuant to the Plan, the
company issued these securities on July 18, 2006:

   (a) 335,600 shares of Series AA Redeemable Preferred Stock,
       par value $.01 per share; and

   (b) 100,000 shares of Common Stock, par value $.01 per share.

The Securities were issued in exchange for the then outstanding:

   (a) $320,000,000 aggregate principal amount of 13% Senior
       Subordinated Notes due 2010;

   (b) Series A Cumulative Exchangeable Redeemable Preferred
       Stock, no par value per share; and

   (c) common stock, no par value per share.

The issuance of the Securities was exempt from the registration
requirements of the Securities Act of 1933, as amended, pursuant
to Section 1145(a)(1) of the Bankruptcy Code because the
securities were issued by a successor of a debtor under a plan of
reorganization entirely in exchange for the claims against or
interests in the debtor.

With respect to the Securities, only the Series AA Preferred
Stock is convertible into other equity securities of the company,
Mr. Kwederis relates.  If the Series AA Preferred Stock has not
been redeemed or repurchased by the fifth anniversary of the
Effective Date, the holders of at least 40% of the outstanding
shares of Series AA Preferred Stock will have the right to cause
all of the outstanding class of Series AA Preferred Stock to be
converted into a number of shares of Common Stock equal to 99.9%
of the number of fully diluted shares of Common Stock after
giving effect to the conversion.

Headquartered in Schaumburg, Illinois, Pliant Corporation --
http://www.pliantcorp.com/-- produces value-added film and
flexible packaging products for personal care, medical, food,
industrial and agricultural markets.  The Debtor and 10 of its
affiliates filed for chapter 11 protection on Jan. 3, 2006
(Bankr. D. Del. Lead Case No. 06-10001).  James F. Conlan, Esq.,
at Sidley Austin LLP, and Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor, represent the
Debtors in their restructuring efforts.  The Debtors tapped
McMillan Binch Mendelsohn LLP, as their Canadian bankruptcy
counsel.   The Ontario Superior Court of Justice named RSM
Richter, Inc., as the Debtors' information officer in their
restructuring proceeding under Companies Creditors Arrangement Act
in Canada.  Kenneth A. Rosen, Esq., at Lowenstein Sandler, P.C.,
serves as counsel to the Official Committee of Unsecured
Creditors.  Don A. Beskrone, Esq., at Ashby & Geddes, P.A., is
local counsel to the Creditors' Committee.  As of Sept. 30, 2005,
the company had $604,275,000 in total assets and $1,197,438,000 in
total debts.  The Debtors emerged from chapter 11 protection on
July 19, 2006 (Pliant Bankruptcy News, Issue No. 20; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


PREMIUM PAPERS: Selling Smart Papers to Plainfield Asset
--------------------------------------------------------
Premium Papers Holdco, LLC, and its debtor-affiliates will sell
substantially all of Smart Papers LLC's assets to Plainfield Asset
Management, after an auction was scheduled last Aug. 15, 2006,
Cincinnati Business Courier reports.

According to Hamilton Journal-News story, the Connecticut-based
hedge fund group agreed to assume control over the Hamilton-based
company and its debt, and pursue its Chapter 11 reorganization.
Plainfield will also enter into a one-year labor agreement with
Smart Papers workers under the same terms as a contract that
expired in June.

Chris Dumond, writing for Hamilton Journal, the investment group
has strike a deal to take over about $40 million of Smart Papers'
debt.  Other terms of the takeover include $5 million in interim
financing for Smart Papers to be followed by $5 million for the
reorganized company, including a $2 million payment plan now owed
to International Paper.

The Court will consider approval of the sale on Aug. 21, 2006.

Headquartered in Hamilton, Ohio, Premium Papers Holdco, LLC, --
http://www.smartpapers.com/-- is an independent manufacturer and
marketer of a wide variety of premium coated and uncoated printing
papers, such as Kromekote, Knightkote, and Carnival.   The Company
and its debtor-affiliates, SMART Papers LLC and PF Papers LLC,
filed for chapter 11 protection on March 21, 2006 (Bankr. D. Del.
Case No. 06-10269).  Ian S. Fredericks, Esq., at Young, Conaway,
Stargatt & Taylor, LLP, represents the Debtors.  Mary E. Seymour,
Esq., at Lowenstein Sandler PC, represents the Official Committee
of Unsecured Creditors.  Traxi LLC serves as the Debtors'
financial advisor.  When the Debtors filed for protection from
their creditors, they listed unknown estimated assets and $10
million to $50 million estimated debts.


QUANTUM CORPORATION: Moody's Rates $375 Million Loans at B2
-----------------------------------------------------------
Moody's Investors Service assigned revised ratings to Quantum
Corporation's proposed secured credit facilities.  The ratings on
the revolver and the first lien term loan were revised to B2 from
B3.  The corporate family rating of B3 and senior subordinated
notes rating of Caa2 were unaffected.  The ratings outlook is
stable.  The notching revision is a result of the change in the
proposed financing structure which will replace its originally
planned $350 million term loan with a $225 million first lien
facility and $125 second lien facility.

The proposed change does not alter the overall leverage.  But
the presence of a second lien piece provides greater cushion
and protection for first lien holders and thus the current
upward notching for the first lien debt.

Moody's also notes that as part of the proposed change of
capital structure, a new covenant will permit acceleration of
maturity for the first lien and second lien term loans to 2010
if Quantum's existing convertible subordinated notes due 2010
did not convert or are not refinanced six months prior to its
maturity in 2010.  The trigger of such event would significantly
heighten the refinancing risk in 2010. For additional rating
rationale originally considered by Moody's in assigning these
ratings please refer to Moody's Press Release dated June 7, 2006.

These ratings were assigned:

   * B2 to $150 million secured revolving facility due 2009
   * B2 to $225 million term loan due 2012

These ratings were withdrawn:

   * B3 rating on $150 million secured revolving facility due
     2009

   * B3 rating on $350 million term loan due 2012

These ratings were affirmed:

   * B3 Corporate Family Rating
   * Caa2 on $160 million convertible subordinated note due 2010

Outlook stable

Quantum Corporation is headquartered in San Jose, California.  It
is a provider of tape drive and tape automation for storage
purposes.


QUEBECOR WORLD: Moody's Reviews Low-B Ratings and May Downgrade
---------------------------------------------------------------
Moody's Investors Service placed the Ba3 Corporate Family Rating,
Ba3 Senior Unsecured rating and B2 Senior Subordinated ratings of
Quebecor World Inc.'s subsidiaries under review for possible
downgrade.  The review is prompted by the continuing poor
operating performance of QWI.

The review will focus on the likelihood that new press investments
and a broader restructuring and cost reduction effort that have
been underway for some time will actually result in improved
margins and cash flow.  Moody's previously stated that in order to
maintain a Ba3 rating, it must develop confidence that 2007 Free
Cash Flow will exceed 5%, Retained Cash Flow will reach the mid-
teens, debt will reduce towards 4X, and Interest will exceed 2X.

The liquidity rating of SGL-3 is affirmed.  This rating has
een moved from Quebecor World Inc. to Quebecor World (USA) Inc.,
which is the senior-most entity within the group for which Moody's
provides a debt rating, and at which the Corporate
Family Rating now resides.

On Review for Possible Downgrade:

Issuer: Quebecor World (USA) Inc.

   * Corporate Family Rating, Placed on Review for Possible
     Downgrade, currently Ba3

   * Senior Subordinated Conv./Exch. Bond/Debenture, Placed on
     Review for Possible Downgrade, currently B2

Issuer: Quebecor World Capital Corporation

   * Senior Unsecured Regular Bond/Debenture, Placed on Review
     for Possible Downgrade, currently Ba3

Issuer: Quebecor World Capital ULC

   * Senior Unsecured Regular Bond/Debenture, Placed on Review
     for Possible Downgrade, currently Ba3

Assignments:

Issuer: Quebecor World (USA) Inc.

   * Speculative Grade Liquidity Rating, Assigned SGL-3

Outlook Actions:

Issuer: Quebecor World (USA) Inc.

   * Outlook, Changed To Rating Under Review From Negative

Issuer: Quebecor World Capital Corporation

   * Outlook, Changed To Rating Under Review From Negative

Issuer: Quebecor World Capital ULC

   * Outlook, Changed To Rating Under Review From Negative

Issuer: Quebecor World, Inc.

   * Outlook, Changed To Rating Withdrawn From Negative

Withdrawals:

Issuer: Quebecor World, Inc.

   * Speculative Grade Liquidity Rating, Withdrawn, previously
     rated SGL-3

Quebecor World Inc. is one of the world's largest commercial
printers, headquartered in Montreal, Quebec, Canada.


RESORTS INT'L: Poor 2nd Quarter Performance Cues S&P's Neg. Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior secured debt ratings on Resorts International Hotel
and Casino Inc. to 'B-' from 'B'.  In additional, all ratings are
placed on CreditWatch with negative implications.

"The CreditWatch listing reflects our concerns about the company's
near term liquidity position following weaker-than-expected
operating performance in the second quarter ended June 30, 2006,"
said Standard & Poor's credit analyst Peggy Hwan Hebard.

EBITDA during the second quarter declined to $6 million from
$13 million in the same prior-year period.  While total revenues
during this period increased $1 million, selling, general, and
administrative costs increased $6 million during the quarter on
higher payroll and benefit costs, as well as higher insurance
premiums.  For the 12 months ended June 30, 2006, EBITDA coverage
of interest was about 1x.

In addition, Resort's liquidity position is tight, with nearly all
balance sheet cash at June 30, 2006, required for operating
purposes, and about $3 million available under its bank facility
with Commerce Bank N.A. that expires on Aug. 31, 2006.  The
company was not in compliance with the Commerce facility covenants
at June 30, 2006, but received a waiver for this deficiency.
While the third quarter is a historically strong one in Atlantic
City, the government-imposed shutdown in early July, in addition
to heightened competition in the market, could further affect
Resort's liquidity position.

In its 10-Q report, the company stated that it is exploring a
number of alternatives, including refinancing and/or restructuring
some or all long-term debt.

Standard & Poor's review will concentrate on an evaluation of the
company's liquidity position.  Prospects for a further downgrade
are not necessarily limited to one notch.


SAINT VINCENTS: Klapholz Says UMNDJ Funds are not Estate Property
-----------------------------------------------------------------
Marc Klapholz, M.D., FACC, commenced an adversary proceeding
seeking to recover certain funds granted for the benefit of his
research projects.

From 1995 to 1999, and resuming since 2004, Dr. Klapholz, has been
employed at the University of Medicine and Dentistry of New
Jersey.

During the years 1995 to 1999, Dr. Klapholz applied for and was
awarded multiple clinical medical research grants for numerous
solicited third party sponsoring grantors for use in his research
projects.

Dr. Klapholz was named as Principal Investigator in the grant
awards and is:

    * personally responsible for overseeing the project study and
      assuring that the conditions of the clinical research study
      and objectives of the grants are carried out in strict
      compliance; and

    * a party to a written contract governing the clinical study
      project and related financial support.

In some instances, despite not being a signatory to the grant
contract, Dr. Klapholz is required to participate -- and is
terminable by the sponsor -- if the designated Principal
Investigator is unable or unwilling to conduct the study.

In November 1999, Dr. Klapholz resigned from UMDNJ and accepted
employment at St. Vincent Catholic Medical Centers.

To continue the research started at UMDNJ, the awarded grant
funds, which were held by UMDNJ for the benefit of Dr. Klapholz's
clinical medical research, were transferred to SVCMC.

The UMDNJ Funds, aggregating $302,011, were transferred by way of
two checks -- one for $137,886 and another for $164,124.

At SVCMC, the grant awards were about $1,118,000 from the
sponsoring organizations and were intended solely to benefit the
clinical medical research projects conducted by Dr. Klapholz and
his Heart Failure Program.

The total net proceeds for the St. Vincent Funds are $543,646.

SVCMC placed the St. Vincent Funds and UMDNJ Funds in separate
accounts.  Deposits of funds from research projects started at
SVCMC were placed in the "Heart Failure II Research" account, or
Account No. 0106.  The UMDNJ Funds were placed into the "Heart
Failure I Research" account, or Account No. 0190, with specific
understandings as to being unencumbered, special purpose, and
segregated in nature.

Among the projects originated at SVCMC was a $50,000 grant from
Scios, Inc., for a diastolic function study.  The SCIOS clinical
medical research project was not initiated before Dr. Klapholz
left SVCMC and returned to UMDNJ in August 2004.

Subsequently, Dr. Klapholz demanded SVCMC to surrender, turnover,
and otherwise deliver (i) the Scios grant funds, (ii) funds from
Amgen, Inversik and Pharmalink totaling $12,518, and (iii) all
other research trust funds.

SVCMC refused and resisted to surrender any of the funds in the
St. Vincent Accounts.

                         Declaratory Judgment

Todd M. Galante, Esq., at St. John & Wayne, L.L.C., in Newark,
New Jersey, asserts that SVCMC wrongfully withholds the Research
Trust Funds from Dr. Klapholz and UMDNJ, and intentionally
interferes with the Funds' specific purposes and uses.

Mr. Galante argues that a declaratory judgment resolving the lack
of beneficial interests of SVCMC in the Research Trust Funds is
necessary to resolve the proper holder, and the proper uses of
the Funds.

Accordingly, Dr. Klapholz and UMDNJ ask the Court to declare
that:

    (a) the Trust Funds and all related interest in SVCMC's
        possession are beneficial property interests of the
        clinical projects;

    (b) SVCMC previously held the Research Trust Funds as a
        fiduciary and in trust for Dr. Klapholz's sole benefit and
        use; and

    (c) SVCMC will account to Dr. Klapholz and UMDNJ for the
        Research Trust Funds and its handling of all funds that
        were entrusted to it from inception to the date the
        balance of all remaining Research Trust Funds are
        delivered to Dr. Klapholz and UMDNJ.

                      Breach of Fiduciary Duty

Mr. Galante notes that SVCMC breached its obligations and
fiduciary duties by making material representations of fact with
respect to the status, nature and character of the segregated
funds, failing and refusing to deliver the funds to Dr. Klapholz
or UMDNJ.

Dr. Klapholz and UMDNJ ask the Court to enter a money judgment
against SVCMC for compensatory and punitive damages, pre- and
post-judgment interest, and reimbursement of all legal fees,
costs and expenses incurred in prosecuting the issue.

                     Conversion of Funds

Mr. Galante avers that SVCMC's refusal to return the Research
Trust Funds amount to a wrongful and intentional conversion of
the Funds.

To this end, Dr. Klapholz and UMDNJ seek injunctive relief
directing (i) the surrender, turnover, and delivery of the Trust
Funds held by SVCMC, and (ii) SVCMC and its assigns to furnish a
complete accounting with respect the Research Trust Funds.

                Imposition of Constructive Trust/Lien

A constructive trust or an equitable lien should be imposed on
the Research Trust Funds and granted in favor of Dr. Klapholz and
UMDNJ, Mr. Galante emphasizes.

Dr. Klapholz and UMDNJ, hence, ask the Court to impose:

    (a) a constructive trust on any identifiable cash balances of
        Research Trust Funds; and

    (b) first priority equitable liens on all forms of SVCMC's
        other property derived from use of the Research Trust
        Fund.

                         Injunctive Relief

Mr. Galante further informs the Court that SVCMC's actions
imposed several harms and injuries on Dr. Klapholz and UMDNJ,
including:

    -- interruption of projects leading to reduced value or even
       destruction of prior testing results on human subjects by
       operation of staleness;

    -- potential loss of third party sponsor funding for the Scios
       project previously approved and paid proximately caused by
       SVCMC's withholding and concomitant inability to commence;
       and

    -- overall interruption on other projects tarnishing
       reputations earned by a career of research in heart failure
       programs serving the ultimate benefit of the general
       public's health and welfare.

For these reasons, Dr. Klapholz and UMDNJ ask the Court to
restrain and enjoin SVCMC and its assigns from:

    (a) taking any action or engaging in any conduct to interfere
        with or hinder the collection of the Research Trust Funds;

    (b) selling, transferring, negotiating, pledging,
        hypothecating, depositing, commingling, or otherwise
        disposing of or secreting, and directing the marshalling
        of the Research Trust Funds; and

    (c) retaining any Research Trust Fund proceeds in its
        possession and directing the turnover and remittance of
        all proceeds and receipts.

                         Accounting

Mr. Galante points out that SVCMC's failure and refusal to
provide an accounting of the Research Trust Funds is a violation
of its fiduciary duties to, and representations made to, Dr.
Klapholz and UMDNJ.

Dr. Klapholz and UMDNJ, therefore, ask the Court to direct SVCMC
to produce all records as to receipt and disbursement of the St.
Vincent Accounts or any other accounts in which funds were
transferred or assets acquired with proceeds from third party
sponsors of grants measured to the present date.

                Dr. Klapholz and UMDNJ Demand
            Preliminary Injunction and Accounting

To maintain the "status quo" pending the determination of their
request, Dr. Klapholz and UMDNJ ask the Court to issue
preliminary injunction as to use of funds and preservation of any
accounting and banking books and records.

To preserve all accounting and banking records related to the
Research Trust Funds, Dr. Klapholz and UMDNJ seek:

    -- immediate restraints as to any transfers and uses of
       certain identifiable cash balances contained in the St.
       Vincent Accounts and any other accounts derived from the
       St. Vincent Accounts; and

    -- interim accounting and restraints.

Mr. Galante discloses that Dr. Klapholz and UMDNJ are suffering
immediate irreparable harm by operation of SVCMC's continued
improper withholding of the Research Trust Funds, and failure to
surrender them for the specific uses for which they were
intended.

                         SVCMC Talks Back

SVCMC denies the allegations raised by Dr. Klapholz and UMDNJ.
SVCMC argues that:

    (i) Dr. Klapholz and UMDNJ fail to state a claim upon which
        relief can be granted;

   (ii) to the extent that Dr. Klapholz and UMDNJ are entitled to
        money or property, that entitlement should be limited to a
        prepetition, general unsecured claim;

  (iii) the claims are barred by the doctrines of unclean hands
        and laches;

   (iv) Dr. Klapholz and UMDNJ are estopped from asserting the
        claims stated in their Complaint against SVCMC;

    (v) there is no traceable trust res on which a constructive
        trust or equitable lien can be imposed; and

   (vi) Dr. Klapholz and UMDNJ are not entitled to any equitable
        remedies because they have an adequate remedy at law.

Accordingly, SVCMC asks the Court to declare that:

    * Dr. Klapholz and UMDNJ will obtain no relief on any Count in
      their Complaint; and

    * SVCMC:

      -- has no obligations to either Dr. Klapholz and UMDNJ; and
      -- is entitled to its costs and attorney's fees.

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. 30
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


SAINT VINCENTS: Panel Resolves Loan Dispute with First American
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of Saint Vincents
Catholic Medical Centers of New York and its debtor-affiliates and
First American Title Insurance Company, as successor in interest
to RCG Longview II, L.P., have signed a stipulation resolving
their dispute.

RCG had made a $10,000,000 loan to SVMC in May 2005.  A
Subordinate Mortgage and Security Agreement dated May 18, 2005,
secured the loan.  RCG also made an additional $6,000,000 loan to
SVCMC in June 2005, which loan was secured by a Third Subordinate
Mortgage and Security Agreement dated as of June 27, 2005.

The Creditor's Committee commenced an adversary proceeding to
avoid the $10,000,000 Subordinate Mortgage, the $10,000,000
Subordinate Assignment, the $6,000,000 Subordinate Mortgage and
the $6,000,000 Subordinate Assignment.

First American in turn asked the Court to:

        a) dismiss the Complaint; and

        b) enter judgment in its favor on all claims and
           counterclaims.

First American maintained that the complaint must be dismissed
because pursuant to Section 547 of the Bankruptcy Code because the
Transfers are unavoidable.

On behalf of the Committee, Craig E. Freeman, Esq., at Alston &
Bird LLP, in New York, asserted that:

    -- First American's Counterclaim fails to state a claim from
       which relief can be granted;

    -- the claims asserted in the Counterclaim are barred, in
       whole or in part, by the doctrines of waiver, estoppel,
       laches, and unclean hands;

    -- the claims asserted in the Counterclaim, to the extent
       legally cognizable, are subject to set off or recoupment;

    -- recovery on the claims asserted in the Counterclaim are
       either diminished or barred by First American's failure to
       mitigate damages;

    -- the relief requested in the Counterclaim should be denied
       based on assumption of risk; and

    -- the relief requested in the Counterclaim should be denied
       because First American fails to make averments with regard
       to alleged misrepresentations with sufficient particularity
       as required by Rule 7009(b) of the Federal Rules of
       Bankruptcy Procedure.

                         Parties Stipulate

The Committee and First American engaged in negotiations to
settle the adversary proceeding and avoid the costs and risks of
further litigation.

In a Court-approved stipulation, the parties agreed that:

    (i) With respect to the $6,000,000 Loan, First American will
        have an allowed general unsecured claim for $6,000,000
        against Saint Vincent catholic Medical Centers.

        The $6,000,000 Subordinate Mortgage and its related liens,
        and the $6,000,000 Subordinate Assignment and its related
        liens, will be deemed avoided under Section 544 of the
        Bankruptcy Code and preserved for the benefit of SVCMC's
        estate.

   (ii) With respect to the $10,000,000 Loan, First American will
        have two claims against SVCMC:

        * an allowed general unsecured claim for $7,000,000; and
        * an allowed secured claim for $3,000,000.

        To the extent of $7,000,000 each, the $10,000,000
        Subordinate Mortgage and its related liens, and the
        $10,000,000 Subordinate Assignment and its related liens,
        will be deemed avoided under Section 544 and preserved for
        the benefit of SVCMC's estate.

        The Allowed $3,000,000 Secured Claim will be deemed to be
        secured by a valid, perfected and enforceable prepetition
        lien on the Properties pursuant to the $3,000,000 portion
        of the $10,000,000 Subordinate Mortgage and the
        $10,000,000 Subordinate Assignment that is not being
        deemed avoided under Section 544.

  (iii) Except for the Allowed Claims, First American will have no
        allowed claims against any of the Debtors.  All proofs of
        claim previously filed by First American or RCG against
        any of the Debtors will be deemed expunged.

   (iv) The parties fully release each other from any obligations.

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. 30
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


SATELITES MEXICANOS: Disclosure Statement Hearing Set for Sept. 6
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on September 6, 2006, to consider approval
of the Disclosure Statement explaining the Plan of Reorganization
filed by Satelites Mexicanos, S.A. de C.V.

Objections, if any, to the Disclosure Statement must be filed by
August 31, 2006.

Section 1125 of the Bankruptcy Code requires a plan proponent to
provide holders of impaired claims with "adequate information"
that would enable a hypothetical investor typical of the holders
of claims or interests in the case, to make an informed judgment
about the plan.

The Debtor's Disclosure Statement clearly meets the requirements
of Section 1125, Luc A. Despins, Esq., at Milbank, Tweed, Hadley &
McCloy LLP, in New York, contends.

Mr. Despins points out that the Disclosure Statement contains
information, including, but not limited to:

   (a) the Chapter 11 Plan;

   (b) the operation of the Debtor's business;

   (c) historical financial information and future projections;

   (d) a valuation of the Debtor's assets;

   (e) accounting and valuation methodology;

   (f) a liquidation analysis;

   (g) the sources of information provided;

   (h) claims against the Debtor's estate;

   (i) the Debtor's indebtedness;

   (j) significant events that preceded the Debtor's Chapter 11
       case;

   (k) significant events that are anticipated to occur during
       the Chapter 11 case;

   (1) the capital and debt structure of the reorganized Debtor;

   (m) the administration of the Debtor's estates following
       confirmation of the Chapter 11 Plan;

   (n) risk factors attendant to the Chapter 11 Plan;

   (o) tax consequences of the Chapter 11 Plan; and

   (p) appropriate disclaimers.

In addition, Mr. Despins says, the Disclosure Statement provides
an overview of key Bankruptcy Code concepts, including allowance,
impairment, and classification, as well as the requirements for
confirmation, and an analysis of alternatives to the Chapter 11
Plan.  The Disclosure Statement concludes with a recommendation
by the Debtor that creditors should vote to accept the Plan.

                   About Satelites Mexicanos

Satelites Mexicanos, S.A. de C.V., provides fixed satellite
services in Mexico.  Satmex provides transponder capacity via its
satellites to customers for distribution of network and cable
television programming, direct-to-home television service, on-site
transmission of live news reports, sporting events and other video
feeds.  Satmex also provides satellite transmission capacity to
telecommunications service providers for public telephone networks
in Mexico and elsewhere and to corporate customers for their
private business networks with data, voice and video applications.
Satmex also provides the government of the United Mexican States
with approximately 7% of its satellite capacity for national
security and public purposes without charge, under the terms of
the Orbital Concessions.

The Debtor filed for chapter 11 petition on August 11, 2006
(Bankr. S.D.N.Y. Case No. 06-11868).  Luc A. Despins, Esq., at
Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the
U.S. Bankruptcy proceedings.  Attorneys from Galicia y Robles,
S.C., and Quijano Cortina Lopez y de la Torre give legal advice in
the Debtor's Mexican Bankrutpcy proceedings.  UBS Securities LLC
and Valor Consultores, S.A. de C.V., give financial advice to the
Debtor.  Steven Scheinman, Esq., Michael S. Stamer, Esq., and
Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld LLP
give legal advice to the Ad Hoc Existing Bondholders' Committee.
Dennis Jenkins, Esq., and George W. Shuster, Jr., Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP give legal advice to Ad Hoc
Senior Secured Noteholders' Committee.  As of July 24, 2006, the
Debtor has $905,953,928 in total assets and $743,473,721 in total
liabilities.

On May 25, 2005, certain holders of Satmex's Existing Bonds and
Senior Secured Notes filed an involuntary chapter 11 petition
against the Company (Bankr. S.D.N.Y. Case No. 05-13862).
On June 29, 2005, Satmex filed a voluntary petition for a Mexican
reorganization, known as a Concurso Mercantil, which was assigned
to the Second Federal District Court for Civil Matters for the
Federal District in Mexico City.

On August 4, 2005, Satmex filed a petition, pursuant to Section
304 of the Bankruptcy Code to commence a case ancillary to the
Concurso Proceeding and a motion for injunctive relief seeking,
among other things, to enjoin actions against Satmex or its assets
(Bankr. S.D.N.Y. Case No. 05-16103).  (Satmex Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


SATELITES MEXICANOS: Wants Court Nod on Solicitation Procedures
---------------------------------------------------------------
Satelites Mexicanos, S.A. de C.V., asks the U.S. Bankruptcy Court
for the Southern District of New York to approve the set of
uniform noticing, balloting, voting and tabulation procedures to
be used in connection with asking creditors to vote to accept its
Chapter 11 Plan of Reorganization.

The Debtor delivered the Plan and accompanying Disclosure
Statement along with its Chapter 11 petition.  A hearing to
consider the adequacy of the Disclosure Statement has been
scheduled for September 6, 2006.

The Debtor anticipates commencing solicitation on or before the
third business day after the entry of an order approving the
Disclosure Statement.  Based on this schedule, the Debtor asks
Judge Drain to a date that is 25 days after the Solicitation Date
as the deadline for creditors to cast votes.

The Debtor also asks the Court to establish the date of the entry
of the Disclosure Statement Order as the record date for purposes
of determining creditors entitled to vote on the Plan.

The Debtor proposes to distribute to each holder of an allowed
claim or interest entitled to vote on the Plan, a solicitation
package containing copies of:

   (i) the notice of the hearing to confirm the Plan;

  (ii) the Disclosure Statement, the Plan and Disclosure
       Statement Order;

(iii) a notice in Spanish containing:

       -- a summary of the treatment of claims under the Plan and
          the discharge, release, and exculpation provisions;

       -- the Confirmation Hearing date, objection deadline; and

       -- basic ballot instructions as well as a Spanish-speaking
          contact for any questions; and

  (iv) a ballot.

Holders of allowed claims and interests in these classes are
impaired and entitled to vote on the Plan:

          Class         Description
          -----         -----------
            2           Senior Secured Note Claims
            4           Existing Bond Claims
            6A, 6B      Existing Preferred Stock Interests
            7A, 7B      Existing Common Stock Interests

The Debtor has prepared customized Ballots based on Official Form
No. 14.  The Ballots have been modified to address the particular
aspects of the Debtor's Chapter 11 case and include certain
additional information that the Debtor believes is relevant and
appropriate for each voting class.

Each Ballot must be properly executed, completed and delivered to
Kurtzman Carson Consultants, Inc., Debtor's notice and balloting
agent.

To conserve estate resources, the Debtor proposes to send to
holders of unimpaired claims in Class 1 (Priority Non-Tax Claims),
Class 3 (Other Secured Claims) and Class 5 (General Unsecured
Claims) a Notice of Non-Voting Status -- Unimpaired Classes.  The
Notice of Non-Voting Status identifies the classes that are
presumed to accept the Plan and sets forth the manner in which a
copy of the Plan and Disclosure Statement may be obtained.

For purposes of voting in connection with the Plan, the Debtor
proposes that Class 2 claims be allowed for $233,388,000 in the
aggregate and Class 4 claims be allowed for $320,000,000 in the
aggregate.  The Debtor also proposes that each interest in Classes
6A and 6B and Classes 7A and 7B be temporarily allowed for voting
purposes.

The Debtor asks the Court not to count these Ballots:

   (1) Any Ballot received after the Voting Deadline unless
       the Debtor will have granted an extension of the Voting
       Deadline with respect to the Ballot;

   (2) Any Ballot that is illegible in any material respect or
       contains insufficient information to permit the
       identification of the claimant or the amount of its claim;

   (3) Any Ballot cast by a person or entity that does not hold a
       claim in a class that is entitled to vote to accept or
       reject the Chapter 11 Plan;

   (4) Any unsigned Ballot;

   (5) Any Ballot transmitted to Kurtzman that does not set forth
       an original signature; and

   (6) Any properly executed, timely received Ballot that
       partially rejects and partially accepts the Plan, or does
       not indicate an acceptance or rejection of the Plan.

The Debtor, however, may instruct Kurtzman to, in its discretion,
contact voters to cure any defects in the Ballots.

Whenever a creditor or interest holder casts more than one Ballot
voting the same claim or interest before the Voting Deadline, the
last Ballot received will be counted.  Vote splitting is not
allowed.

The Debtor will also direct Kurtzman to deliver Solicitation
Packages to:

   (a) each holder of record of its Debt Securities as of the
       Record Date; and

   (b) to each bank or brokerage firm identified by Kurtzman as
       an entity through which Beneficial Holders hold the Debt
       Securities.

All Nominees through which Beneficial Holders hold the Debt
Securities will be required either:

   (i) to send prevalidated Beneficial Holder Ballots to the
       Beneficial Holders for which they serve, for direct return
       to Kurtzman; or

  (ii) to receive and summarize on a Master Ballot all Beneficial
       Holder Ballots cast by the Beneficial Holders for which
       they serve and then return the Master Ballot to Kurtzman.

The Debtor will assume that:

   -- each Prevalidated Ballot is for a single account; and

   -- each vote is a separate vote and not duplicative of any
      other vote cast by other customers of that Nominee, unless
      specific evidence exists indicating that one vote is for
      the identical account number and amount of another vote.

To the extent that conflicting votes or duplicative votes are
submitted on a Master Ballot, the Debtor will direct Kurtzman to
attempt to reconcile the votes prior to the Voting Deadline.

The Court will convene a hearing to consider the Debtor's request
on September 6, 2006, at 10:00 a.m.  Objections, if any, must be
filed by August 31, 2006.

                   About Satelites Mexicanos

Satelites Mexicanos, S.A. de C.V., provides fixed satellite
services in Mexico.  Satmex provides transponder capacity via its
satellites to customers for distribution of network and cable
television programming, direct-to-home television service, on-site
transmission of live news reports, sporting events and other video
feeds.  Satmex also provides satellite transmission capacity to
telecommunications service providers for public telephone networks
in Mexico and elsewhere and to corporate customers for their
private business networks with data, voice and video applications.
Satmex also provides the government of the United Mexican States
with approximately 7% of its satellite capacity for national
security and public purposes without charge, under the terms of
the Orbital Concessions.

The Debtor filed for chapter 11 petition on August 11, 2006
(Bankr. S.D.N.Y. Case No. 06-11868).  Luc A. Despins, Esq., at
Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the
U.S. Bankruptcy proceedings.  Attorneys from Galicia y Robles,
S.C., and Quijano Cortina Lopez y de la Torre give legal advice in
the Debtor's Mexican Bankrutpcy proceedings.  UBS Securities LLC
and Valor Consultores, S.A. de C.V., give financial advice to the
Debtor.  Steven Scheinman, Esq., Michael S. Stamer, Esq., and
Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld LLP
give legal advice to the Ad Hoc Existing Bondholders' Committee.
Dennis Jenkins, Esq., and George W. Shuster, Jr., Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP give legal advice to Ad Hoc
Senior Secured Noteholders' Committee.  As of July 24, 2006, the
Debtor has $905,953,928 in total assets and $743,473,721 in total
liabilities.

On May 25, 2005, certain holders of Satmex's Existing Bonds and
Senior Secured Notes filed an involuntary chapter 11 petition
against the Company (Bankr. S.D.N.Y. Case No. 05-13862).
On June 29, 2005, Satmex filed a voluntary petition for a Mexican
reorganization, known as a Concurso Mercantil, which was assigned
to the Second Federal District Court for Civil Matters for the
Federal District in Mexico City.

On August 4, 2005, Satmex filed a petition, pursuant to Section
304 of the Bankruptcy Code to commence a case ancillary to the
Concurso Proceeding and a motion for injunctive relief seeking,
among other things, to enjoin actions against Satmex or its assets
(Bankr. S.D.N.Y. Case No. 05-16103).  (Satmex Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


SHERIDAN GROUP: Financial Risk Cues Moody's to Downgrade Ratings
----------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
for The Sheridan Group, Inc. to B2 from B1 and the senior secured
notes rating to B2 from B1.  The downgrade reflects Moody's
concerns over the negative margin impact resulting from Sheridan's
acquisition of The Dingley Press in 2004, as well as weaker
fundamental business prospects compared to management's prior
expectations.

The company is unlikely to meet its originally targeted leverage
in the mid 3 times range for year end 2006.  Moody's now expects
leverage to be in the high 4 times range.

The outlook is stable.

Sheridan's ratings reflect the modest growth prospects and
competitive pressures in its industry, its lack of scale, and
financial risk.  High customer retention in Sheridan's niche
segment, expectations for margin stabilization, and good liquidity
support its ratings.

A summary actions follows.

The Sheridan Group, Inc.

   * Corporate Family Rating, Downgraded to B2 from B1
   * Senior Secured Bonds, Downgraded to B2 from B1

Outlook: Stable

Elevated capital spending over the past several years pressured
free cash flow generation.  Free cash flow fell to approximately
negative $5 million over the trailing twelve months through June
30 compared to modestly positive free cash flow in 2005 and 2004.
Moody's believes management will face some challenge in its plan
to achieve revenue and EBITDA growth while reducing capital
expenditures to a level closer to depreciation.  Nevertheless, the
stable outlook incorporates expectations for positive free cash
flow from operations in 2007, after a slight use of cash in 2006.
Moody's also expects margins to stabilize in the 12% to 14% range.

The Sheridan Group, Inc. offers printing services to the
journal, catalog, magazine, book and article reprint markets.
Headquartered in Hunt Valley, Maryland, its annual sales are
approximately $350 million.


SILICON GRAPHICS: Committee Taps FTI as Financial Advisors
----------------------------------------------------------
As reported in the Troubled Company Reporter on Jul 20, 2006,
Silicon Graphics, Inc., debtor-affiliates and the ad hoc committee
of certain holders of 6.50% Senior Secured Convertible Notes
objected to the proposed compensation structure under the Official
Committee of Unsecured Creditors' application to retain FTI
Consulting, Inc., as its financial advisors.

The U.S. Bankruptcy Court for the Southern District of New York
denied the Creditors' Committee's application on July 19, 2006.

The Creditors' Committee again seeks the Court's authority to
retain FTI as its financial advisors, effective as of May 18,
2006.

Jaspaul Singh, co-chairperson of the Committee, relates that FTI
has formulated a revised compensation structure acceptable to both
the Ad Hoc Committee and the Debtors.

Specifically, FTI will be paid a fixed allowance through Sept. 30,
2006, in the form of a monthly payment of:

     -- $175,000 for the period May 18 to July 17;

     -- $125,000 for the period July 18 to August 17; and

     -- $100,000 for the remaining period of August 18 through
        September 30.

The total monthly payment for the Final Period will be $100,000,
regardless of the duration of the period.

Any services provided after September 30, 2006, will be billed at
FTI's customary hourly rates:

       Senior Managing Directors                $595 to $655
       Directors/Managing Directors             $435 to $590
       Associates/Consultants                   $215 to $405

Mr. Singh informs the Court that FTI has provided substantial
services to assist the Creditor's Committee in the negotiation of
the Global Settlement Agreement, the Debtors' Plan of
Reorganization, and the Disclosure Statement.  FTI continues to
provide services required by the Creditors' Committee, including
monitoring of operations, advising the Committee concerning the
confirmation process, and analyzing claims that may impact
distributions to unsecured creditors.

Headquartered in Mountain View, California, Silicon Graphics, Inc.
(OTC: SGID) -- http://www.sgi.com/-- offers high-performance
computing.  SGI helps customers solve their computing challenges,
whether it's sharing images to aid in brain surgery, finding oil
more efficiently, studying global climate, providing technologies
for homeland security and defense, enabling the transition from
analog to digital broadcasting, or helping enterprises manage
large data.  The Debtor and 13 of its affiliates filed for chapter
11 protection on May 8, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10977
through 06-10990).  Gary Holtzer, Esq., and Shai Y. Waisman, Esq.,
at Weil Gotshal & Manges LLP, represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed total assets of $369,416,815 and
total debts of $664,268,602.  (Silicon Graphics Bankruptcy News,
Issue No. 14; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


SOLO CUP: Moody's Reviews Low-B Ratings and May Downgrade
---------------------------------------------------------
Moody's placed the credit ratings of Solo Cup Company on review
for possible downgrade following the company's announcement that
it will delay filing financial statements for the fiscal second
quarter ended July 2, 2006.  Solo has announced that it will
conduct an internal review of certain accounting practices and
procedures related to current or prior periods.  The internal
review relates to fiscal periods commencing with the SF Holdings
transaction that was completed in February 2004.  Solo has
initiated discussions with bank lenders to gain an extension
of the deadline for filing financial statements.

Moody's placed these ratings on review for possible downgrade:

   * $150 million senior secured revolving credit facility
     maturing February 27, 2010, B2

   * $637 million senior secured term loan B due February 27,
     2011, B2

   * $80 million senior secured second lien term loan due 2012,
     B3

   * $325 million 8.5% senior subordinated notes due February 15,
     2014, Caa1

   * Corporate Family Rating, B2

Moody's review will consider the effects on Solo's financial
flexibility and liquidity resulting from its failure to file
timely financial statements.  Moody's also will study Solo's
financial performance and the results of the examination of
certain accounting practices and procedures.  Moody's expects
to conclude its review when Solo files its financial statements.

Headquartered in Highland Park, Illinois, Solo Cup Company is one
of the largest domestic manufacturers of disposable paper and
plastic food and beverage containers used in the foodservice and
retail consumer markets.  Products include cups, lids, straws,
napkins, cutlery, and plates. Revenues for the twelve months ended
April 2, 2006 were approximately $2.5 billion.


TEX STAR: Wants Exclusive Plan-Filing Period Stretched to Dec. 1
----------------------------------------------------------------
Tex Star Can, LLC, asks the Honorable Marvin Isgur of the United
States Bankruptcy Court for the Southern District of Texas in
Houston to extend until Dec. 1, 2006, its time to exclusively file
a disclosure statement and plan of reorganization.

The Debtor wants its exclusive period extended to allow it to
complete its marketing plan and maximize the value of its
property.

Headquartered in College Station, Texas, Tex Star Can, LLC, filed
for chapter 11 protection on Apr. 3, 2006 (Bankr. S.D. Tex. Case
No. 06-31395).  Lawrence J. Maun, Esq., at Lawrence J. Maun, P.C.,
represents the Debtor in its restructuring efforts.  No Official
Committee of Unsecured Creditors has been appointed in the
Debtor's case.  Michael J. Eddy at General Capital Partners, LLC,
gives financial advice to the Debtor.  When the Debtor filed for
protection from its creditors, it estimated assets between $10
million and $50 million and estimated debts between $1 million and
$10 million.


TKO SPORTS: Plan Confirmation Hearing Set for August 23
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas will
convene a hearing at 9:00 a.m., on Aug. 23, 2006, to consider
confirmation of TKO Sports Group USA Limited's First Amended
Chapter 11 Plan of Reorganization.

Objections to the confirmation of the Plan must be filed and
served by Aug. 18, 2006 to:

     Counsel for the Debtor:

     Edward L. Rothberg, Esq.
     Weycer Kaplan, Pulaski & Zuber, PC
     11 Greenway Plaza, Suite 1400
     Houston TX 77046

     Counsel for the Committee:

     Leah Eisenberg, Esq.
     Arent Fox, PLLC
     1675 Broadway, NY 10019

           and

     The U.S. Trustee
     515 Rusk Street, 3rd Floor
     Houston, TX 77002

                          Plan Overview

The Amended Plan is the result of negotiations among the Debtor
and various other parties.  All payments required under the Plan
will be funded from the Debtor's available cash.  The Reorganized
Debtor will continue operations after the effective date in an
effort to hold and regain market-share.  The Debtor says that it
has secured a product placement in a new Adam Sandler movie, and
will continue marketing efforts through trade shows and retail
promotions.

Bank of Montreal will get $550,000 of its $587,500 allowed secured
claim.  The $42,500 balance will be reallocated for the benefit of
holders of Allowed General Unsecured Claims.  The Debtor will pay
the $550,000 out over a period of ten months with minimum equal
monthly payments of $55,000 commencing June 2, 2006.  The
additional $5,000 reallocated for the benefit of general unsecured
claim holders will be taken out of the payment due BOM on July 14
2006.

All secured claims, other than those of BOM, will be deemed
general unsecured claims in full under Section 506(a) of the
Bankruptcy Code.  If the holder of a secured claim disagrees with
this treatment, the holder may file a motion for valuation with
the Bankruptcy Court no later than 10 business days after the
effective date requesting that the Bankruptcy Court determine the
validity and extent, of the secured claim in dispute.  The Debtor
has the option to return the collateral securing the claim or pay
the full value of the claim in cash.

Holders of allowed general unsecured claims, estimated at
approximately $3.8 million, will be paid 15% of their allowed
claim, payable in equal installments every six months for three
years, commencing within thirty days after the effective date.
Funds for the initial payment will come from the BOM Reallocated
Funds and the Reorganized Debtor's cash.  The unsecured creditors
will be entitled to a Creditor Representative who will act as
their representative and observation and default notice agent to
observe and monitor the Reorganized Debtor and enforce the
creditors' rights.

Pursuant to the Plan, all Intercompany Claims, estimated at
$7,750,000, will be waived, discharged and expunged, and holders
will not receive any distribution.

TKO Holdings, Inc., will retain its Equity Interest in the
Reorganized Debtor.  However, the Reorganized Debtor will be
prohibited from paying dividends, distributions, or extraordinary
payment to TKO, TKO Holdings, Inc., or TSG until all payments
under the Plan are complete and satisfied.

Headquartered in Houston, Texas, TKO Sports Group USA Limited,
aka TKO Sports Group, Inc. -- http://www.strengthtko.com/--  
manufactures sporting goods and fitness equipment.  The Company
filed for chapter 11 protection on Oct. 11, 2005 (Bankr. S.D. Tex.
Case No. 05-48509).  Edward L. Rothberg, Esq., at Weycer, Kaplan,
Pulaski & Zuber, P.C., represents the Debtor in its restructuring
efforts.  Andrew I. Silfen, Esq., and Schuyler G. Carroll, Esq.,
at Arent Fox, PLLC, represent the Official Committee of Unsecured
Creditors.  When the Debtor filed for protection from its
creditors, it listed $8,193,809 in assets and $10,571,610 in
debts.


TRUMP ENT: Court Okays Pact Allowing SMG to Pursue Taj Mahal Claim
------------------------------------------------------------------
On Dec. 2, 2004, Tennman Touring, LLC, also known as Tennman
Entertainment, filed a complaint against Trump Taj Mahal
Associates, now known as Trump Taj Mahal Associates, LLC, before
the Superior Court of New Jersey, Atlantic County bearing Docket
No. ATL-L-3853-04.

Six other actions were filed in the Superior Court relating to
the Tennman Litigation, which were consolidated into Docket No.
ATL-L-2287-04.

Strategic Management Group, Inc., also known as SMG, Inc.,
asserts cross-claims for indemnification in the Litigation, which
the Debtors deny.

The Litigation involved the collapse of a super grid structure
prior to a music event on Aug. 9, 2003, which structure was
attached to a building known as the Historic Boardwalk.

On Feb. 10, 2005, SMG filed Claim No. 2175, a late claim, against
Trump Taj Mahal relating to the facts and circumstances that are
the bases for the Litigation.  The Debtors deny the allegations
that are the basis for the Claim and the Litigation.

After engaging in negotiations, the parties entered into a
stipulation, which the Bankruptcy Court subsequently approved.

Under the stipulation, the parties agree that:

   (1) Claim No. 2175 is deemed timely filed;

   (2) SMG is granted relief from the automatic stay so that it
       may pursue Claim No. 2175 against the Trump Taj Mahal in
       any appropriate non-bankruptcy court or forum that has
       appropriate jurisdiction over the Claim;

   (3) the automatic stay will remain in effect as to all other
       claims that have been or may have been asserted against
       the Debtors in the Litigation or arising from or relating
       to the facts and circumstances that are the basis for
       Claim No. 2175; and

   (4) SMG will have the right to adjudicate and liquidate
       Claim No. 2175 in any appropriate non-bankruptcy court or
       forum that has appropriate jurisdiction over the Claim
       rather than proceeding with the claim adjudication process
       in the Bankruptcy Court; and

   (5) any final judgment in the Litigation entered in favor of
       SMG or any settlement between SMG and the Debtors will be
       satisfied in accordance with the terms of the Plan subject
       to the limitations that the amount that SMG is entitled to
       receive on account of Claim No. 2175 will be capped at the
       amount set forth in the Claim.

Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc., nka Trump Entertainment Resorts, Inc. --
http://www.thcrrecap.com/-- through its subsidiaries, owns and
operates four properties and manages one property under the Trump
brand name.  The Company and its debtor-affiliates filed for
chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No.
04-46898 through 04-46925).  Robert A. Klymman, Esq., Mark A.
Broude, Esq., John W. Weiss, Esq., at Latham & Watkins, LLP, and
Charles Stanziale, Jr., Esq., Jeffrey T. Testa, Esq., William N.
Stahl, Esq., at Schwartz, Tobia, Stanziale, Sedita & Campisano,
P.A., represent the Debtors in their successful chapter 11
restructuring.  When the Debtors filed for protection from their
creditors, they listed more than $500 million in total assets and
more than $1 billion in total debts.  The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005,
and the plan took effect on May 20, 2005.  (Trump Hotels
Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 10, 2005,
Moody's Investors Service affirmed the ratings of Trump
Entertainment Resorts, Inc.'s $200 million senior secured revolver
due 2010 at B2; $150 million senior secured term loan due 2012 at
B2; $150 million senior secured delayed draw term loan due 2012 at
B2; $1.25 billion second lien senior secured notes due 2015 at
Caa1; Speculative grade liquidity rating at SGL-3; and Corporate
family rating at B3.  Moody's says the rating outlook is stable.


TRUMP ENT: Breaks Ground on $250 Mil. Hotel at Taj Majal Casino
---------------------------------------------------------------
Trump Entertainment Resorts, Inc., announced that construction
officially commenced in July 2006 on the new, $250 million hotel
tower at the Trump Taj Mahal Casino Resort.

"As we constantly strive to create a more entertaining and
exciting atmosphere at each of our properties, the construction
of our new hotel tower is planned to greatly increase our guest
capacity at the Taj Mahal," Mark Juliano, the Company's
chief operating officer, said.  "As we renovate the casino floor
and develop more dining and retail options at the Taj Mahal, these
rooms will serve as a critical component of our plan to expand
our business and attract more valuable customers."

Completion of the tower construction is expected during the summer
of 2008.  The new tower is planned to add 786 rooms to the Taj
Mahal, which currently has 1,250 rooms in the existing hotel
tower.  Standing 40 stories high and 450-feet tall, the tower's
rooms include 716 generously apportioned standard guest rooms and
70 suites with ocean views.  The primary architect on the project
is the Friedmutter Group.

Construction of the new tower is in addition to the Company's
previously announced $110 million renovation and expansion plan.
Projects already completed include the renovation of nearly every
hotel guest room at all three Trump properties; the entire casino
floor renovation and the opening of 24 Central Cafe at Trump Plaza
Casino and Hotel; the Ego Bar and Lounge, Trump Exchange retail
store, The Asian Gaming Pit and the new noodle bar, The Rim, at
the Taj Mahal.  Construction of the new retail and dining entrance
corridor to the Taj Mahal is underway, as is the renovation of the
casino floor.  The master plan for the Trump Marina Hotel Casino
is also currently being developed.

"We believe that expanding the Company's guest room inventory in
Atlantic City is a critical component of our overall plan to
capitalize on the changing and growing gaming marketplace," James
B. Perry, chief executive officer of the Company, said.  "As
Atlantic City continues to transform into a destination market for
customers, our expansion and renovation plan is being specifically
tailored to create new entertainment options, to increase the
overall quality of experience at Trump properties, and to increase
value for shareholders of the Company."

Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc., nka Trump Entertainment Resorts, Inc. (Nasdaq:
TRMP) -- http://www.thcrrecap.com/-- through its subsidiaries,
owns and operates four properties and manages one property under
the Trump brand name.  The Company and its debtor-affiliates filed
for chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case
No. 04-46898 through 04-46925).  Robert A. Klymman, Esq., Mark A.
Broude, Esq., John W. Weiss, Esq., at Latham & Watkins, LLP, and
Charles Stanziale, Jr., Esq., Jeffrey T. Testa, Esq., William N.
Stahl, Esq., at Schwartz, Tobia, Stanziale, Sedita & Campisano,
P.A., represent the Debtors in their successful chapter 11
restructuring.  When the Debtors filed for protection from their
creditors, they listed more than $500 million in total assets and
more than $1 billion in total debts.  The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005,
and the plan took effect on May 20, 2005.  (Trump Hotels
Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                           *     *     *

As reported in the Troubled Company Reporter on Nov. 10, 2005,
Moody's Investors Service affirmed the ratings of Trump
Entertainment Resorts, Inc.'s $200 million senior secured revolver
due 2010 at B2; $150 million senior secured term loan due 2012 at
B2; $150 million senior secured delayed draw term loan due 2012 at
B2; $1.25 billion second lien senior secured notes due 2015 at
Caa1; Speculative grade liquidity rating at SGL-3; and Corporate
family rating at B3.  Moody's says the rating outlook is stable.


UNIGENE LABORATORIES: June 30 Balance Sheet Upside-Down by $8.9MM
-----------------------------------------------------------------
Unigene Laboratories, Inc., filed its financial results for the
second quarter ended June 30, 2006, with the Securities and
Exchange Commission on Aug. 9, 2006.

For the three months ended June 30, 2006, the Company incurred a
$3 million net loss on $555,987 of net revenues, compared to a
$2.5 million net loss on $215,139 of net revenues in 2005.

At June 30, 2006, the Company's balance sheet showed $18.3 million
in total assets and $27.2 million in total liabilities, resulting
in a $8.9 million stockholders' deficit.

The Company's June 30 balance sheet also showed strained liquidity
with $13.1 million in total current assets available to pay
$18.3 million in total current liabilities coming due within the
next 12 months.

At June 30, 2006, the Company had cash and cash equivalents of
$7,664,000, an increase of $3,517,000 from Dec. 31, 2005.  On
March 16, 2006, the Company completed the sale of a total of
4,000,000 shares of its common stock and a common stock warrant to
purchase up to 1,000,000 shares of its common stock to Magnetar
Capital Master Fund, Ltd., pursuant to a common stock purchase
agreement.  The five-year warrant is exercisable immediately at an
exercise price per share of $4.25.  The Company received gross
proceeds of $13,000,000 before expenses of approximately $193,000.

A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?fd2

                        Going Concern Doubt

Grant Thornton LLP in Edison, New Jersey, expressed substantial
doubt about Unigene Laboratories' ability to continue as a going
concern after auditing the Company's financial statements for the
fiscal year ended Dec. 31, 2005.  The auditing firm pointed to the
Company's recurring losses from operations, working capital
deficiency, and the Company has stockholder demand loans in
default at Dec. 31, 2005.

Unigene Laboratories, Inc. -- http://www.unigene.comor
http://www.fortical.com-- is a biopharmaceutical company focusing
on the oral and nasal delivery of large-market peptide drugs. Due
to the size of the worldwide osteoporosis market, Unigene is
targeting its initial efforts on developing calcitonin and PTH-
based therapies.  Fortical(R), Unigene's nasal calcitonin product
for the treatment of postmenopausal osteoporosis, received FDA
approval and was launched in August 2005.  Unigene has licensed
the U.S. rights for Fortical to Upsher-Smith Laboratories,
worldwide rights for its oral PTH technology to GlaxoSmithKline
and worldwide rights for its calcitonin manufacturing technology
to Novartis.


UNITED MEDICORP: Acquires Incipient Healthcare Contract Rights
--------------------------------------------------------------
United Medicorp, Inc. completed an Asset Purchase Agreement to
acquire the customer contracts of Incipient Healthcare Solutions,
Inc. of Arlington, Texas.  The services provided by IHS under the
subject contracts include retrospective claims review, workers
compensation claims review, and collections. UMC also acquired the
rights to all prospective customer contracts, which are in the IHS
sales pipeline.  IHS was founded in 2001, and has established
customer relationships with a number of major hospitals in Texas
and Oklahoma.

Based upon projections developed by UMC and IHS management, the
IHS contracts currently in force are expected to produce revenues
of about $600K per year, with additional revenues expected from
contracts in the sales pipeline. In addition, seven employees of
IHS will join UMC, including Ron Corder, President of IHS.  Mr.
Corder will become Vice President of Business Development for UMC.

"UMC management is excited over the merger with His," Pete Seaman,
CEO, stated.  "The IHS employees who will join UMC bring
significant expertise that will complement the skills of UMC's
existing staff.  The retrospective claims review services at which
IHS has excelled during the last several years will provide UMC an
entree into a new service line which will help diversify our
customer base and enhance the services provided by UMC."

"I believe this is a wonderful opportunity for all concerned," Ron
Corder, President of IHS, stated.  "Two companies with similar
visions and excellent customer relationships are joining together
to enhance our service capabilities and provide added benefits to
our customers."

IHS revenues during 2003, 2004, and 2005 were $2,062,478,
$1,165,929, and $872,928, respectively.  IHS filed for protection
under Chapter XI of the Bankruptcy Code in July 2004.  The parties
have not announced detailed terms of the transaction, which is
subject to approval by the Bankruptcy Court.

Headquartered in Dallas, Texas, United Medicorp, Inc. (OTCBB:UMCI)
-- http://www.umcinc.com/-- provides extended business office
services to healthcare providers nationwide.

                   Going Concern Doubt

As reported in the Troubled Company Reporter on May 18, 2006,
KBA Group, LLP, expressed substantial doubt about United Medicorp
Inc.'s ability to continue as a going concern after it audited the
company's financial statement for the year ended Dec. 31, 2005.
The auditing firm pointed to the company's net loss and loss of
significant customer contracts.


UNITED RENTALS: Earns $56 Million in Quarter Ended June 30
----------------------------------------------------------
United Rentals Inc. reported net income of $56 million from
total revenues of $995 million for the three months ended
June 30, 2006.

At June 30, 2006, the Company's balance sheet showed total
stockholders' equity of $1,402 million from total assets of $5
,530 million and total liabilities of $4,128 million.

A full-text copy of the Company's financial report for the three
months ended June 30, 2006 is available for free at:

               http://researcharchives.com/t/s?fd8

Headquartered in Greenwich, Connecticut, United Rentals, Inc. --
http://unitedrentals.com/-- is an equipment rental company, with
an integrated network of more than 750 rental locations in 48
states, 10 Canadian provinces and Mexico.  United Rentals is a
member of the Standard & Poor's MidCap 400 Index and the Russell
2000 Index(R).

                          *     *     *

As reported in the Troubled Company Reporter on June 8, 2006,
Fitch affirmed the ratings of United Rentals, Inc. and its
principal operating subsidiary, United Rentals (North America),
Inc., and removed them from Rating Watch Negative where they were
placed on July 14, 2005.  Approximately $2.9 billion of debt is
affected by the action.  The rating outlook for URI and URNA was
Stable.

Fitch's affirmed United Rentals Inc.'s Issuer Default Rating and
United Rentals (North America) Inc.'s Issuer Default and Senior
Unsecured Debt ratings at 'BB-'.


USA COMMERCIAL: Court Okays Lewis and Roca as Panel's Counsel
-------------------------------------------------------------
The Honorable Linda B. Riegle of the U.S. Bankruptcy Court for the
District of Nevada in Las Vegas authorized the Official Committee
of Unsecured Creditors in USA Commercial Mortgage Company and its
debtor-affiliates' chapter 11 cases, to retain Lewis and Roca LLP,
as its counsel.

As reported in the Troubled Company Reporter on July 4, 2006,
Lewis and Roca will:

   a) advise the Committee with respect to the powers and duties
      of the Committee in these Chapter 11 cases;

   b) consult with the Debtor concerning the administration of
      this case;

   c) advise the Committee with respect to the powers and duties
      of the Debtor in the continued operation of its business and
      the management of its assets in this Chapter 11 case;

   d) investigate the Debtor's acts, conduct, assets, liabilities,
      and financial condition, the operation of the Debtor's
      business and the desirability of the

   e) participate in the negotiation, formulation, and drafting of
      a plan of reorganization, including modifications and
      amendments, and advise the Committee regarding the
      acceptance and confirmation process;

   f) prepare all necessary pleadings and papers pertaining to
      matters of bankruptcy law or the case, including, without
      limitation, appeals and other litigation as is necessary to
      represent the Committee;

   g) participate in any proceeding or hearing in the Bankruptcy
      Court, any federal appellate Court, or any other judicial or
      administrative forum in which any action or proceeding may
      be pending which may affect the Debtor, its assets, or the
      claims of its creditors;

   h) advise the Committee with respect to the use, sale or lease
      of property, financing and the rejection and assumption of
      executory contracts and unexpired leases, among other
      things; and

   i) provide all other legal services that may be necessary
      during the pendency of this Chapter 11 case on behalf of the
      Committee.

Rob Charles, Esq., a Lewis and Roca partner, disclosed that the
firm's professionals bill:

     Attorney                   Position            Hourly Rate
     --------                   --------            -----------
     Susan M. Freeman, Esq.     Partner                $510
     Rob Charles, Esq.          Partner                $385
     Scott K. Brown, Esq.       Associate              $320
     Marilyn Schoenike          Certified Legal        $185
                                Assistant

Mr. Linstrom assured the Court that the firm is disinterested as
that term is defined in Section 101(14) of the Bankruptcy Code.

Based in Las Vegas, Nevada, USA Commercial Mortgage Company, dba
USA Capital (USACM) -- http://www.usacapitalcorp.com/-- provides
more than $1 billion in short-term and permanent financing to
homebuilders, commercial developers, apartment owners and
institutions nationwide.  The Company and its debtor-affiliates
filed for chapter 11 protection on April 13, 2006 (Bankr. D. Nev.
Case Nos. 06-10725 to 06-10729).  Lenard E. Schwartzer, Esq., at
Schwartzer & Mcpherson Law Firm, represents the Debtors.  Candace
C. Carlyon, Esq., and Shawn w. Miller, Esq., at Shea & Carlyon,
Ltd., and Jeffrey H. Davidson, Esq., Frank A. Merola, Esq., and
Eve H. Karasik, Esq., at Stutman, Treister & Glatt, PC, represent
the Debtors' Investor Committees.  Susan M. Freeman, Esq., and Rob
Charles, Esq., at Lewis and Roca LLP represent the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated assets of more
than $100 million and debts between $10 million and $50 million.


USA COMMERCIAL: Panels Hire Stutman Treister as Special Counsel
---------------------------------------------------------------
The Honorable Linda B. Riegle of the U.S. Bankruptcy Court for the
District of Nevada in Las Vegas authorized the Investor Committees
appointed in USA Commercial Mortgage Company and its debtor-
affiliates' chapter 11 cases, to employ Stutman, Treister & Glatt,
PC, as their special counsel for all common interest matters.

As reported in the Troubled Company Reporter on June 26, 2006,
the Investor Committees include:

    i) The Official Committee of Equity Security Holders of USA
       Capital First Trust Deed Fund, LLC;

   ii) the Official Committee of Equity Security Holders of USA
       Capital Diversified Trust Deed Fund, LLC; and

  iii) the Official Committee of Holders of Executory Contract
       Rights Through USA Commercial Mortgage Company

On May 12, 2006, the First Trust Deed Committee decided to engage
Stutman Treister.  Upon hearing this, the others Committee decided
to hire the firm so as to reduce administrative costs and avoid
unnecessary litigation.

Stutman Treister agreed to work with the Investor Committees for
all matters involving conflicts among the Investor Committees.

Stutman Treister will:

   a) protect and preserve the collective interests of the
      Debtors' investors;

   b) advise the Investor Committees on the requirements of the
      Bankruptcy Code and the Bankruptcy Rules as they pertain to
      the interests of the Investor Committees and their
      constituents;

   c) develop through discussions with the Investor Committees,
      Shea & Carlyon, Ltd., and other parties-in-interest, the
      Investor Committees' legal positions and strategies with
      respect to all facets of these Chapter 11 cases, including,
      without limitation, analyzing the Investor Committees'
      position on administrative and operational issues;

   d) prepare motions, applications, answers, orders, memoranda,
      reports, and papers in connection with representing the
      interests of the Investor Committees;

  (e) participate in the negotiations and resolution of issues
      related to financing and any plan of reorganization; and

  (f) render such other necessary advice and services that the
      Investor Committees may require in connection with the
      bankruptcy cases.

The Investor Committee members and Stutman Treister have prepared
certain guidelines:

   -- first, the Investor Committee will establish a committee
      composed of the three Investor Committee designees as each
      of the Committees will designate.  Stutman Treister will
      work with the Executive Committee to:

      * formulate the Investor Committees' legal positions and
        strategies; and

      * serve as "lead counsel" to each of the Investor Committee
        in implementing those strategies.

   -- second, each of the Investor Committees will hire separate
      conflicts counsel, who will represent its Investor Committee
      with respect to identifying conflicts that would require a
      particular committee to take and pursue a position adverse
      to the shared position of the other committees.

Stutman Treister will coordinate with Shea & Carlyon, Ltd., for
individual matters to minimize duplication.

Jeffrey H. Davidson, Esq., a member at Stutman Treister, disclosed
the firm's professionals hourly rates:

          Designation             Hourly Rate
          -----------             -----------
          Principals              $450 - $725
          Associates              $250 - $395
          Law Clerks              $150 - $205
          Paralegals              $180 - $195

Mr. Davidson noted that the attorneys and paralegal expected to be
most active in the Debtors' cases are:

          Professional                   Hourly Rate
          ------------                   -----------
          Jeffrey H. Davidson, Esq.         $650
          Frank A. Merola, Esq.             $575
          Eve H. Karasik, Esq.              $550
          Christine M. Pajak, Esq.          $350
          Kendra L. Johnson                 $180

Mr. Davidson assured the Court that his firm is disinterested as
that term is defined in Section 101(14) of the Bankruptcy Code.

Based in Las Vegas, Nevada, USA Commercial Mortgage Company, dba
USA Capital (USACM) -- http://www.usacapitalcorp.com/-- provides
more than $1 billion in short-term and permanent financing to
homebuilders, commercial developers, apartment owners and
institutions nationwide.  The Company and its debtor-affiliates
filed for chapter 11 protection on April 13, 2006 (Bankr. D. Nev.
Case Nos. 06-10725 to 06-10729).  Lenard E. Schwartzer, Esq., at
Schwartzer & Mcpherson Law Firm, represents the Debtors.  Candace
C. Carlyon, Esq., and Shawn w. Miller, Esq., at Shea & Carlyon,
Ltd., and Jeffrey H. Davidson, Esq., Frank A. Merola, Esq., and
Eve H. Karasik, Esq., at Stutman, Treister & Glatt, PC, represent
the Debtors' Investor Committees.  When the Debtors filed for
protection from their creditors, they estimated assets of more
than $100 million and debts between $10 million and $50 million.


USA COMMERCIAL: Panels Hire Shea & Carlyon as Nevada Counsel
------------------------------------------------------------
The Honorable Linda B. Riegle of the U.S. Bankruptcy Court for the
District of Nevada in Las Vegas authorized the Investor Committees
appointed in USA Commercial Mortgage Company and its debtor-
affiliates' chapter 11 cases, to retain Shea & Carlyon, Ltd., as
their special Nevada counsel.

As reported in the Troubled Company Reporter on June 28, 2006,
Shea & Carlyon will:

   a) provide representation of the Investor Committees as Nevada
      Counsel for Stutman, Treister & Glatt, PC, including review
      of pleadings and papers, and appearances at such matters as
      341 meetings and omnibus hearings;

   b) provide representation to the Investor Committees in Las
      Vegas if both ST&G & Shea & Carlyon determine that
      representation should be handled by Shea & Carlyon;

   c) attend meetings of the Investor Committees, and assist with
      related tasks;

   d) assist with filing and service of documents;

   e) communicate with members of the Investor Committees and
      their constituents, as well as other counsel in the USA
      cases;

   f) provide general case assistance, if that assistance is
      required;

   g) provide representation as to matters as to which ST&G may
      have conflicts or potential conflicts; and

   h) handle discrete tasks, if agreed between the Investor
      Committees, ST&G and Shea & Carlyon.

The firm's professionals bill:

          Designation                      Hourly Rate
          -----------                      -----------
          Shareholders & of Counsel        $325 - $425
          Associates                           $190
          Legal Assistants &               $120 - $150
          Paraprofessionals

James Patrick Shea, Esq., a member of Shea & Carlyon, assured the
Court that his firm is disinterested as that term is defined in
Section 101(14) of the Bankruptcy Code.

Based in Las Vegas, Nevada, USA Commercial Mortgage Company, dba
USA Capital (USACM) -- http://www.usacapitalcorp.com/-- provides
more than $1 billion in short-term and permanent financing to
homebuilders, commercial developers, apartment owners and
institutions nationwide.  The Company and its debtor-affiliates
filed for chapter 11 protection on April 13, 2006 (Bankr. D. Nev.
Case Nos. 06-10725 to 06-10729).  Lenard E. Schwartzer, Esq., at
Schwartzer & Mcpherson Law Firm, represents the Debtors.  Candace
C. Carlyon, Esq., and Shawn w. Miller, Esq., at Shea & Carlyon,
Ltd., and Jeffrey H. Davidson, Esq., Frank A. Merola, Esq., and
Eve H. Karasik, Esq., at Stutman, Treister & Glatt, PC, represent
the Debtors' Investor Committees.  Susan M. Freeman, Esq., and Rob
Charles, Esq., at Lewis and Roca LLP represent the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated assets of more
than $100 million and debts between $10 million and $50 million.


US LEC: Paetec Merger Prompts Moody's to Hold Ratings
-----------------------------------------------------
Moody's Investors Service placed Paetec Communications Inc.'s
corporate family rating on review for possible downgrade following
the company's announcement that it is acquiring US LEC Corp. for
about $560 million, net of cash.  The acquisition will consist of
an exchange of common stock, valued at about $160 million, the
redemption of $268 million in US LEC's preferred stock and the
refinancing of $158 million in US LEC debt.

In conjunction with the transaction, Paetec is proposing a new
$850 million credit facility, which will pay for the acquisition
and refinance the $374 million of its existing debt.  Since
Paetec's existing credit facilities are expected to be refinanced
with the transaction, Moody's affirmed the bank facility ratings,
which will be withdrawn at closing.

In a related action, Moody's affirmed US LEC's ratings.  At the
closing of the transaction, the US LEC ratings will be withdrawn.

The potential financing will increase Paetec's pro forma adjusted
leverage to about 5.7x at closing, from 4.8x at June 30, 2006,
thereby pressuring the ratings downwards. The ratings action
reflects the increased financial stress placed on the company's
capital structure, specifically, the increase in leverage and the
impact on free cash flow during the integration period.  Moody's
does however, positively view the company's enhanced operating
scale in the eastern US, and the potential for EBITDA growth
driven by merger synergies.

The review will focus on:

   1) the impact of the new financing on Paetec's capital
      structure;

   2) the company's strategy for successfully integrating US
      LEC's operations and generating meaningful cost reductions;

   3) the company's ability to resume generating sustainable free
      cash flow, in light of the US LEC integration; and,

   4) Paetec's ongoing acquisition strategy and its potential
      impact on the company's capital structure.

Moody's took these ratings actions:

Issuer: Paetec Communications, Inc.

   * Corporate Family Rating -- Rating Under Review for Possible
     Downgrade from B2

   * Senior Secured Revolving Credit Facility, Affirmed B1

   * 1st Lien Senior Secured Term Loan, Affirmed B1

   * 2nd Lien Senior Secured Term Loan, Affirmed B3

Issuer: US LEC Corp.

   * Corporate Family Rating Affirmed Caa1
   * 2nd Lien Senior Secured Notes Affirmed B3
   * Speculative Grade Liquidity Affirmed SGL-2

Paetec, headquartered in Fairport, New York, is a CLEC and
generated revenues of $509 million in 2005. US LEC, headquartered
in Charlotte, North Carolina, is a CLEC and generated revenues of
$388 million in 2005.


U.S. MICROBICS: June 30 Balance Sheet Upside-Down by $7.3 Million
-----------------------------------------------------------------
U.S. Microbics, Inc. reported financial results for the third
quarter of fiscal year 2006 ended June 30, 2006.  Compared to the
third quarter of last fiscal year, revenues decreased by 75% as
contracts neared completion, while gross profits increased to 49%
of revenue and operating expenses rose as business development
efforts continued strong in Mexico.

The Company had revenues of $447,697 and $76,661 during the nine
months and three months ended June 30, 2006, a 38% and 75%
decrease, respectively, as compared to $719,715 and $307,253 of
revenues for the nine months and three months ended June 30, 2005.
Revenues for the nine months ended June 30, 2006, consisted
primarily of revenue generated from the contracts for the State of
Puebla, Mexico.  Revenues for the nine months ended June 30, 2005,
consisted primarily of contracts for bio-remediation of
hydrocarbons in contaminated soil for the state of South Carolina,
a $100,000 consulting contract with USM Capital Group, and
engineering support services provided in Mexico.  The decrease in
revenue is due to a decrease in revenue from consulting contracts
by USM Capital Group.

"Revenues decreased in second quarter as we neared the end of
several projects in Mexico by our environmental subsidiary, Sub-
Surface Waste Management, while starting newer ones that have
little initial revenue recognition in the early stages," Company
CEO Robert Brehm commented.  "Gross profit margins where higher on
the reduced revenue, and we expect higher revenues in the last
quarter as the new projects ramp up now that we have our
diagnostic equipment running well in Mexico.  The Company
anticipates completing the contracting paperwork this quarter for
the eleven environmental emergency response centers located
throughout the state of Veracruz and plans to start center
implementation shortly thereafter."

Gross profit for the nine months and three months ended June 30,
2006, was $164,315 and $37,679, or 37% and 49% of sales, compared
to a profit of $290,356 and $44,851, or 40% and 15% of sales, for
the corresponding period in fiscal 2005.

The Company incurred a loss from operations of $2,744,297 and
$1,014,964 for the nine months and three months ended June 30,
2006, and had negative cash flows from operations of $1,596,306
for the nine months ended June 30, 2006, compared to a loss from
operations of $2,291,191 and $716,740 for the nine months and
three months ended June 30, 2005, and negative cash flows from
operations of $1,407,759 for the nine months ended June 30, 2005.

At June 30, 2006, the Company's balance sheet showed a
stockholders' deficit of $7,316,931, compared to a deficit of
$6,450,519 at Sept. 30, 2005.

                       About U.S. Microbics

Headquartered in Carlsbad, California, U.S. Microbics, Inc.
(OTCBB:BUGS) -- http://www.bugsatwork.com/-- is a business
development and holding company that acquires, develops and
deploys innovative environmental technologies for soil,
groundwater and carbon remediation, air pollution reduction,
modular drinking water systems and agriculture enhancement.

                       Going Concern Doubt

As reported in the Troubled Company Reporter on June 8, 2006,
Russell Bedford Stefanou Mirchandani, LLP, in McLean, Virginia,
raised substantial doubt about U.S. Microbics Inc.'s ability to
continue as a going concern after auditing the Company's
consolidated financial statements for the years ended Sept. 30,
2005 and 2004.  The auditor pointed to the Company's difficulty in
generating sufficient cash flow to meet its obligations and
sustain its operations.


VERESTAR INC: PanAmSat Holds $5.78 Million Allowed Unsecured Claim
------------------------------------------------------------------
The Honorable Allan L. Groper of the U.S. Bankruptcy Court for the
Southern District of New York approved a stipulation among
Verestar, Inc., the Official Committee of Unsecured Creditors and
PanAmSat Corp. allowing PanAmSat to hold a $5,782,675 general
unsecured claim and a $69,456 administrative expense claim against
the Debtors.

Matthew A. Feldman, Esq., at Willkie Farr & Gallagher LLP, in New
York City, told the Court that on May 13, 2004, PanAmSat filed its
proof of claim against Verestar arising out of contracts between
Verestar and PanAmSat for the lease of certain transponder space
from PanAmSat and the purchase of certain services from Verestar.
The Proof of Claim asserts, inter alia:

   (1) a general unsecured claim for:

       -- rejection damages in connection with two PanAmSat
          Service Agreements that were rejected by Verestar;

       -- amounts due as of May 1, 2004, with respect to the
          assumed PanAmSat Service Agreements; and

       -- claims for rejection damages in the event that the
          closing of the sale to SES Americom, Inc., did not occur
          or the PanAmSat Contracts were not otherwise assumed by
          the Debtors; and

   (2) a secured claim on account of PanAmSat's alleged right of
       setoff pursuant to Section 553 of the Bankruptcy Code in
       the amount of $2,138,575 for services performed prepetition
       by Verestar under certain of the Verestar Service
       Agreements.

The Debtors and the Committee dispute PanAmSat's alleged right of
setoff and believe that the Service Agreement Claims are general
unsecured claims.

On November 17, 2005, the Court entered an order authorizing the
Committee to commence certain avoidance actions on behalf of the
Debtors' bankruptcy estates.   On December 20, 2005, the Committee
commenced an adversary proceeding against PanAmSat (Adv. Proc. No.
05-3243) seeking the avoidance and return of $2,217,592 on the
basis that such payments are subject to avoidance under Bankruptcy
Code Sections 547, 550, and 551.  In addition to disputing the
amount of the Payments, PanAmSat believes it has valid defenses in
the Adversary Proceeding and that the Payments are not subject to
avoidance.  PanAmSat presented the Debtors and the Committee its
factual and legal support for its assertions that those Payments
should not be subject to avoidance.

The Committee has since undertaken its own review of the Payments
and the circumstances pursuant to which Verestar transferred the
Payments to PanAmSat.  The Committee believes that prosecution of
the Adversary Proceeding would not provide significant value to
the Debtors' estates in light of litigation costs and the strength
of the Parties' respective claims and defenses.  PanAmSat also has
agreed that it will abandon its claims that the Service
Agreement Claim is a secured claim against the proceeds of the
sale of the Debtors' assets to SES Americom, Inc., or against any
other assets of the Debtors.

Under the stipulation, the Adversary Proceeding will be dismissed
with prejudice and without costs assessed against either the
Committee or PanAmSat.

Headquartered in Fairfax, Virginia, Verestar, Inc. --
http://www.verestar.com/-- was a provider of satellite and
terrestrial-based network communication services prior to the sale
of substantially all of its assets.  Verestar is a wholly owned
subsidiary of American Tower Corporation, a non-debtor.  The
Company and two of its affiliates filed for chapter 11 protection
on December 22, 2003 (Bankr. S.D.N.Y. Case No. 03-18077).  Matthew
Allen Feldman, Esq., at Willkie Farr & Gallagher LLP represents
the Debtors.  When the Company filed for protection from its
creditors, it listed $114 million in assets and more than
$635 million in debts.  David S. Rosner, Esq., Cindy C. Kelly,
Esq., Michael J. Bowe, Esq., Brian Condon, Esq., and Erin
Zavalkoff, Esq., at Kasowitz, Benson, Torres & Friedman LLP,
represent the Official Committee of Unsecured Creditors.  Barry N.
Seidel, Esq., and Scott E. Eckas, Esq., at King & Spalding LLP,
represent American Tower Corporation and the Individual
Defendants.  Barry H. Berke, Esq., and Stephen M. Sinaiko, Esq.,
at Kramer, Levin, Naftalis & Frankel, LLP, represent the Bear
Stearns Defendants.


VIRAGEN INC: Posts $3.6 Mil. Net Loss for Quarter Ended March 31
----------------------------------------------------------------
For the three months ended March 31, 2006, Viragen, Inc. incurred
net loss of $3,655,085 from product sales of $98,643.

Viragen, Inc.'s balance sheet at Mar. 31, 2006 showed total assets
of $17,226,777, total liabilities of $14,469,474, and total
stockholders' equity of $2,757,303.

The Company's balance sheet also showed $6,207,425 in total
current assets and $2,208,044 in total current liabilities.

A full-text copy of the Company's financial report for the quarter
ended March 31, 2006 is available for free at:

               http://researcharchives.com/t/s?ca2

Headquartered in Plantation, Florida, Viragen, Inc. (Amex: VRA)
-- http://www.Viragen.com/-- is a biopharmaceutical company
focused on the research, development, manufacture and
commercialization of products for the treatment of infectious
diseases and cancers.  The Company has operations in the U.S.,
Scotland and Sweden.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 14, 2006,
Ernst & Young LLP expressed substantial doubt about Viragen's
ability to continue as a going concern after it audited the
Company's financial statements for the fiscal year ended June 30,
2005.  The auditors pointed to the Company's operating losses,
accumulated deficit and working capital deficiency.


VIRAGEN INT'L: March 31 Balance Sheet Upside-Down by $13.9 Mil.
---------------------------------------------------------------
Viragen International, Inc.'s balance sheet at March 31, 2006
showed total stockholders' deficit of $13,902,235 resulting from
total assets of $13,491,503 and total liabilities of $27,393,738.

The Company's balance sheet also showed $2,815,343 in total
current assets and $888,161 in total current liabilities.

For the three months ended March 31, 2006, Viragen reported a
net loss of $1,869,616 from $98,643 of product sales.

A full-text copy of the Company's financial report for the quarter
ended March 31, 2006 is available for free at:

               http://researcharchives.com/t/s?ca6

                       Going Concern Doubt

Ernst & Young LLP expressed substantial doubt about Viragen
International, Inc.'s ability to continue as a going concern after
auditing the Company's financial statements for the years ended
June 30, 2005 and 2004.  The auditing firm pointed to the
Company's recurring operating losses and accumulated deficit.

Headquartered in Plantation, Florida, Viragen International Inc.
is engaged in the research, development, manufacture and sale of a
natural human alpha interferon product for treatment of viral and
malignant diseases.  The Company is a subsidiary of Viragen Inc.


WATTSHEALTH FOUNDATION: Settlement Resolves $15 Million of Claims
-----------------------------------------------------------------
WATTSHealth Foundation, Inc., asks the U.S. Bankruptcy Court for
the Central District of California in Los Angeles to approve a
"Confidential Settlement and General Release Agreement"  with its
former employees Sandra Brooks, Faith Martin and Jeffrey Baron.

The settlement resolves separate claims filed by the employees
with and aggregate face amount of $15,920,000.  Due to their
confidential nature, the Debtor did not file a copy of the
settlement with the Court.

Gary E. Klausner, Esq., at Stutman Treister & Glatt, tells the
Bankruptcy Court that the settlement terms include:

      -- a cash payment of insurance proceeds to be made by the
         Debtor's insurer within the 10 day after the Court's
         approval of the settlement; and

      -- the allowance of the employees' claims, in significantly
         reduced amounts, as general unsecured claims.

In return for the settlement consideration each claimant will
comprehensively release the Debtor and its estate.

Headquartered in Inglewood, California, WATTSHealth Foundation,
Inc., dba UHP Healthcare, provides comprehensive medical and
dental services for Commercial, Medi-Cal and Medicare members in
the Greater Southern California area.  The Company filed for
chapter 11 protection on May 31, 2005 (Bankr. C.D. Calif. Case No.
05-22627). Gary E. Klausner, Esq., at Stutman Treister & Glatt
represents the Debtor in its restructuring efforts.  Richard K.
Diamond, Esq., at Danning, Gill, Diamond & Kollitz, LLP,
represents the Official Committee of Unsecured Creditors, and
Ronald F. Greenspan and Matthew Pakkala at FTI Consulting, Inc.,
serve as the Committee's financial advisors.  When the Debtor
filed for protection from its creditors, it estimated assets and
debts of $50 million to $100 million.


WATTSHEALTH FOUNDATION: Plan Filing-Period Stretched to Sept. 15
----------------------------------------------------------------
The Honorable Thomas B. Donovan of the U.S. Bankruptcy Court for
the Central District of California in Los Angeles extended, until
Sept. 15, 2006, WATTSHealth Foundation, Inc.'s exclusive period to
file a Chapter  11 Plan.

Judge Donovan also extended the Debtor's exclusive period to
solicit acceptances of the Plan of Reorganization until
Nov. 14, 2006.

The Bankruptcy Court has recently approved the sale of all of the
Debtor's business lines to Care 1st Health Plan.  The Debtor tells
the Court that its proposed Plan of Reorganization will be based
on the Care 1st transaction.

The Official Committee of Unsecured Creditors has agreed to the
exclusivity extensions.

Headquartered in Inglewood, California, WATTSHealth Foundation,
Inc., dba UHP Healthcare, provides comprehensive medical and
dental services for Commercial, Medi-Cal and Medicare members in
the Greater Southern California area.  The Company filed for
chapter 11 protection on May 31, 2005 (Bankr. C.D. Calif. Case No.
05-22627). Gary E. Klausner, Esq., at Stutman Treister & Glatt
represents the Debtor in its restructuring efforts.  Richard K.
Diamond, Esq., at Danning, Gill, Diamond & Kollitz, LLP,
represents the Official Committee of Unsecured Creditors, and
Ronald F. Greenspan and Matthew Pakkala at FTI Consulting, Inc.,
serve as the Committee's financial advisors.  When the Debtor
filed for protection from its creditors, it estimated assets and
debts of $50 million to $100 million.


WINN-DIXIE: Files Final Joint Plan & Disclosure Statement
---------------------------------------------------------
Winn-Dixie Stores, Inc., and its 23 debtor-affiliates submitted to
the U.S. Bankruptcy Court for the Middle District of Florida their
final Joint Plan of Reorganization and its accompanying Disclosure
Statement on Aug. 9, 2006.

Judge Funk authorized the Debtors to make additional changes
to the Disclosure Statement explaining their amended Plan of
Reorganization before the commencement of the solicitation
process.

Judge Funk ruled that the Disclosure Statement accompanying the
amended Plan of Reorganization contains adequate information
within the meaning of Section 1125(a) of the Bankruptcy Code.

A full-text copy of the Debtors' final Joint Plan and
Disclosure Statement is available for free at
http://ResearchArchives.com/t/s?fe3

In view of the deemed rejection by holders of claims in Classes
18 to 21, the Debtors will seek confirmation of the Plan pursuant
to the "cramdown" provisions of the Bankruptcy Code.

Holders of claims in Classes 7 to 17 are entitled to vote on the
Plan.  Holders of claims Classes 1 to 6, which claims will be
paid in full pursuant to the Plan, are deemed to have accepted
the Plan.

The Debtors further reserve the right to seek confirmation of the
Plan in the event that holders of claims in Classes 7 to 17 vote
to reject the Plan.

According to D.J. Baker, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York, Section 1129(b) of the Bankruptcy Code
provides that a plan can be confirmed even if it is not accepted
by all impaired classes, as long as at least one impaired class
of claims has accepted it.

The Court may confirm a plan at the request of the Debtors if the
plan "does not discriminate unfairly" and is "fair and equitable"
as to each impaired class that has not accepted the Plan,
Mr. Baker adds.

However, if the requisite acceptances are not received or the
Plan is not confirmed and consummated, according to Mr. Baker,
the theoretical alternatives include:

   (a) formulation of an alternative plan or plans of
       reorganization; or

   (b) liquidation of the Debtors under Chapter 7 or Chapter 11
       of the Bankruptcy Code.

The Debtors believe that confirmation and consummation of the
Plan is preferable to all other alternatives because the Plan
enables claimants to realize the greatest possible value under
the circumstances.

Thus, the Debtors urge all holders of claims in Classes 7 to 17
to vote to accept the Plan, and to complete and return their
ballots so that they will be received on or before 4:00 p.m.
(Eastern Time) on Sept. 25, 2006.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people.  The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King &
Spalding LLP, represent the Debtors in their restructuring
efforts.  Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 48; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


WINN-DIXIE: Panel Taps Spencer Stuart to Search for Directors
-------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Winn-
Dixie Stores, Inc., and its debtor-affiliates' bankruptcy cases
seeks authority from the U.S. Bankruptcy Court for the Middle
District of Florida to retain Spencer Stuart as director retention
consultant effective as of July 10, 2006.

Pursuant to the Debtors' Joint Plan of Reorganization, the
Creditors Committee will select seven individuals to serve on the
board of directors of reorganized Winn-Dixie Stores.

The Creditors Committee is seeking the assistance of Spencer
Stuart in conducting an efficient and expedient search for new
directors.

Spencer Stuart has nearly 50 years of experience in the executive
search field and is one of the leading executive search firms in
the United States.  Spencer Stuart also has extensive experience
in assisting companies in selecting board candidates.

Spencer Stuart will:

   (1) meet with the Creditors Committee to develop background
       information on the significant issues and creditor
       expectations before approaching and meeting with
       candidates;

   (2) work with the Creditors Committee to develop detailed
       position specifications;

   (3) construct a search strategy for the positions to define
       and prioritize potential candidate locations, position
       levels and other elements of the search focus to ensure a
       comprehensive search assignment;

   (4) conduct an intensive search utilizing its retail networks
       and knowledge of the marketplace to yield qualified
       individuals for the Creditors Committee to compare and
       evaluate;

   (5) thoroughly interview qualified candidates to obtain a
       realistic understanding of their experience,
       accomplishments, capabilities, and potential, as well as
       prepare and present a comprehensive resume for review of
       each candidate recommended for interview;

   (6) present the best qualified and interested individuals for
       selection interviews;

   (7) assist as necessary in developing and negotiating the
       final compensation package and other terms of employment
       for the directors;

   (8) conduct reference checks of successful candidates;

   (9) conduct periodic progress reviews with the Creditors
       Committee to discuss individuals contacted, candidate
       interest, recruiting issues, and any other matters related
       to the search; and

  (10) perform other search-related services as may be required
       by the Creditors Committee.

Spencer Stuart will be retained until the completion of the
assignment unless terminated beforehand in accordance with the
provisions of the engagement letter dated July 10, 2006.

The Debtors have agreed that they will be solely responsible for
the payment of all fees and expenses incurred by Spencer Stuart.

Spencer Stuart's retainer fee will be up to $525,000, which will
be billed in three equal installments for up to seven board
member placements at $75,000 per each placement.  Installments
are to be paid by the Debtors on Aug. 15, 2006; Sept. 15, 2006;
and Oct. 16, 2006.

If the Court will not approve the application prior to an
Installment Date, Spencer Stuart will be paid as soon as
practicable upon order of the Court.

In addition to its retainer fee, Spencer Stuart also charges
monthly for search-related expenses at 10% of each installment.
Spencer Stuart will also be reimbursed for direct, out-of-pocket
expenses.

Thomas J. Snyder, a consultant at Spencer Stuart, assures the
Court that his firm is disinterested as defined by Section 101(14)
of the Bankruptcy Code.  Mr. Snyder says his firm holds no adverse
interest to the Debtors.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people.  The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King &
Spalding LLP, represent the Debtors in their restructuring
efforts.  Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 48; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


WISE METALS: Negative Cash Flow Prompts S&P to Junk Ratings
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Linthicum, Maryland-based Wise Metals Group LLC to
'CCC+' from 'B-'.

At the same time, Standard & Poor's lowered its senior secured
note rating on the company to 'CCC-' from 'CCC+'.  The outlook is
negative.

"The downgrade reflects Wise Metal's negative cash flows, thin
liquidity level, and increasing debt levels," said Standard &
Poor's credit analyst Dominick D'Ascoli.

The increased price of aluminum since the end of 2005 has resulted
in an increase in Wise Metal's working capital levels and a
corresponding increase in its debt level.  The increase in
aluminum prices has also negatively affected operating results, as
the company could not fully pass on these metal cost increases
because of limits imposed by its customer contracts.

"We believe the company will succeed in modifying customer
contracts to enable it to pass on rising aluminum costs in the
future.  However, liquidity is likely to reach precarious levels
in the interim," Mr. D'Ascoli said.

Mr. D'Ascoli added, "The rating on the senior secured notes was
lowered notches below the corporate credit rating from one notch
below because of the significant amount of priority debt added to
the capital structure."

Wise participates in the mature and consolidated aluminum
beverage-can industry through the manufacturing of aluminum sheet
from a single facility.

"We could lower the ratings on Wise Metals if liquidity declines
to precarious levels or if the company fails to service its debt,"
Mr. D'Ascoli said.

"We could revise the outlook to positive if liquidity improves and
the company reduces its onerous debt level through working capital
reductions.  It is unlikely we would revise the outlook to stable
as an interim step before revising it positive."


WOLF HOLLOW: S&P Affirms $110 Mil. 2nd-Lien Term Loan's B Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' rating on
Wolf Hollow I L.P.'s $240 million first-lien senior secured term
loan facility due June 2012 and $50 million working-capital
facility due December 2010 and its 'B' rating and on the company's
second-lien $110 million term loan due December 2012.

At the same time, Standard & Poor's revised its outlook on the
facilities to negative following outages related to a likely fuel
contamination issue.  These outages follow a longer-than-expected
planned outage in February and March 2006.

The fuel contamination outage in June and July is likely a one-
time event, and the project is attempting to the recover the
resulting losses.

"Nonetheless, we revised the outlook to negative because the two
outages will materially affect Wolf Hollow's financial
performance," said Standard & Poor's credit analyst Daniel Welt.

Standard & Poor's said that the outages significantly raise the
risk that the project will be unable to meet the credit
agreement's financial covenant requiring 1.2x debt service
coverage in December 2006 even if it were to recover part of its
losses from the summer outage.

If the project were unable to attain waivers and were to breach
the covenant, it would be an event of default.

"The negative outlook on Wolf Hollow reflects the lack of
financial cushion, which has been significantly reduced by outages
in the winter and summer of 2006," said Mr. Welt.


WORLD WIDE: Trustee Hires John Bohl & Associates as Accountants
---------------------------------------------------------------
Basil T. Simon, Esq., the trustee appointed in World Wide
Financial Services Inc.'s chapter 7 liquidation proceeding,
obtained permission from the U.S. Bankruptcy Court for the Eastern
District of Michigan to employ John Bohl & Associates LLC as his
accountants.

John Bohl & Associates is expected to assist Mr. Simon in the
administration of the Debtor's estate.

Particularly, the Firm will:

   a) review, examine and analyze debtor financial affairs;

   b) prepare any required corporate, payroll or excise tax
      returns;

   c) prepare a preference and fraudulent transfer analysis;

   d) investigate and analyze other potential assets for the
      estate;

   e) prepare any accountings or financial reports; and

   f) advise the Trustee on any matters relating to finance,
      accounting and taxes.

John C. Bohl, Jr., a certified public accountant and partner at
John Bohl & Associates LLC, discloses that the Firm's
professionals bill:

   Professional                    Hourly Rate
   ------------                    -----------
   Members/Managers                   $200
   Members/Managers & Associates      $130
   Accounting Staff                   $60 to $100
   Paraprofessionals                  $50

Mr. Bohl assures the Court that his Firm does not hold any
interest adverse to the Debtor's estate and is disinterested
pursuant to Sec. 101(14) of the Bankruptcy Code.

Headquartered in Southfield, Michigan, World Wide Financial
Services, Inc., is a mortgage company.  The Company filed for
chapter 11 protection on Oct. 4, 2005 (Bankr. E.D. Mich. Case No.
05-75180).  On July 24, 2006, the Bankruptcy Court converted the
Debtor's case into a chapter 7 proceeding (Bankr. E.D. Mich. Case
No. 05-75180).  Dennis W. Loughlin, Esq., and Lynn M. Brimer,
Esq., at Raymond & Prokor, P.C., represent the Debtor.  No
Official Committee of Unsecured Creditors was appointed in the
Debtor's case.  Basil T. Simon, Esq., was appointed bankruptcy
trustee and is represented by Daniel J. Gunn, Esq., and John D.
Hertzberg, Esq., at Hertzberg, P.C.  The Debtor reported
$2.5 million in assets and $32.5 million in liabilities in its
statement of assets and debts.


WORLD WIDE: Court Sets December 13 as Deadline for Filing Claims
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
set Dec. 13, 2006 as the last day for all creditors owed money by
World Wide Financial Services Inc. to file proofs of claim.

Governmental units must file their claims on or before Jan. 24,
2007.

Proofs of claim must be received by the bankruptcy clerk's office
at this address:

   Katherine B. Gullo
   Clerk of Bankruptcy Court
   U.S. Bankruptcy Court
   Eastern District of Michigan
   211 West Fort Street
   Detroit, MI 48226

Headquartered in Southfield, Michigan, World Wide Financial
Services, Inc., is a mortgage company.  The Company filed for
chapter 11 protection on Oct. 4, 2005 (Bankr. E.D. Mich. Case No.
05-75180).  On July 24, 2006, the Bankruptcy Court converted the
Debtor's case into a chapter 7 proceeding (Bankr. E.D. Mich. Case
No. 05-75180).  Dennis W. Loughlin, Esq., and Lynn M. Brimer,
Esq., at Raymond & Prokor, P.C., represent the Debtor.  No
Official Committee of Unsecured Creditors was appointed in the
Debtor's case.  Basil T. Simon, Esq., was appointed bankruptcy
trustee and is represented by Daniel J. Gunn, Esq., and John D.
Hertzberg, Esq., at Hertzberg, P.C.  The Debtor reported $2.5
million in assets and $32.5 million in liabilities in its
statement of assets and debts.


* BOOK REVIEW: Debtors and Creditors in America
-----------------------------------------------
Author:     Peter J. Coleman
Publisher:  Beard Books
Softcover:  303 pages
List Price: $34.95

Order your personal copy at
http://amazon.com/exec/obidos/ASIN/189312214x/internetbankrupt


Suppose that, three hundred or so years ago, you were in urgent
need of a pig.  But you couldn't afford the pig, so you purchased
it on credit. (Yes, there was credit in the woodsy days of this
country; it wasn't strictly a cash and barter economy.)  Sometime
later, the pig having served the purpose for which it was intended
and hence being no longer recoverable, and you not being the
winner of the lottery you'd relied upon to pay your debt, the
creditor seeks satisfaction.

He could proceed against you in a couple of different ways, but
either way, assuming you still hadn't won the lottery, you went to
jail.  And there you rotted, unless you had the means to buy your
way out, in which case you wouldn't be there in the first place.
In a notorious perversion of logic, a debtor, like any other
prisoner, was expected to feed and clothe himself while
incarcerated.  A pauper's grave -- the so-called potter's field --
awaited the debtor who died in prison.

It could have been worse: Under ancient Roman law, creditors were
entitled to chunks of your actual body and -- sorry, Will
Shakespeare -- there was no penalty for hacking off a
disproportionate slice.

What changed this nefarious system?  Not sentiment (at least not
primarily), but hard economic facts.  For one thing, it was an
ineffective arrangement.  The creditor derived malicious
satisfaction from watching his debtor fade away in prison, but
they didn't satisfy the debt.  For another thing, the colonies
suffered a chronic people shortage.  They needed laborers and
militiamen.  Society couldn't afford to lose the prisoner's labor,
or his ability to shoulder a musket and defend against Indian
attacks.  Nor could society afford to support the innocent wife
and children "perishing with hunger & cold" (here's where
sentiments entered into the equation).

The system began to be modified in various ways.  For some
categories of debtors, commonly single men who owed little, some
colonies substituted indentured service for imprisonment.  Another
modification, applicable to petty debts, provided a release from
prison and immunity from rearrest if the debtors swore he was
impoverished -- presumably a more effective deterrent centuries
ago when there was true shame associated with being a deadbeat.  A
third modification put clothing, furniture, eating utensils, and
tools beyond the reach of agreement.

None of this was of any help to the larger defaulters, the
businessmen, and it was for their benefit (economic necessity,
again) that colonial bankruptcy laws began to evolve.
Interestingly, the colonies preferred voluntary proceedings,
giving the right of action to the insolvent, in contrast to
English bankruptcy practice, which sided with the creditor.
Development of bankruptcy relief was by no means smooth as
predictably many stern and rockbound colonists took a moral stance
against it.  Complicating matters was the requirement that, until
the Revolution, a debtor relief law, like any colonial
legislation, had to be approved by the Crown, in this case the
Board of Trade.

The author provides a painstaking region-by-region analysis of the
development of bankruptcy law, and sums up all the history in the
concluding chapter.

                             *********

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, Robert Max Victor M. Quiblat II,
Shimero R. 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
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herein is obtained from sources believed to be reliable, but is
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The TCR subscription rate is $725 for 6 months delivered via e-
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for the term of the initial subscription or balance thereof are
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at 240/629-3300.

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