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/raid1/www/Hosts/bankrupt/TCR_Public/060927.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, September 27, 2006, Vol. 10, No. 230 Headlines 1POINT SOLUTIONS: Involuntary Chapter 11 Case Summary A & H PETROLEUM: Case Summary & 8 Largest Unsecured Creditors ADELPHIA COMMS: 12 Creditor Groups Object to Second DS Supplement ADELPHIA COMMS: Broadcast Music Agrees to License Pact Rejection AGRICORE UNITED: Moody's Assigns Loss-Given-Default Ratings AK STEEL: Final Contract Offer Gets "No" Votes from Union Workers ALLIANCE ONE: Moody's Assigns Loss-Given-Default Rating ALLIS-CHALMERS: Moody's Assigns Loss-Given-Default Rating ALON USA: Moody's Assigns Loss-Given-Default Rating AMERICAN SEAFOODS: Moody's Assigns Loss-Given-Default Ratings AMES DEP'T: ASM Capital Wants G&A Sales' Admin. Claims Disallowed AMES DEPARTMENT: Obtains Default Judgment Against G&A Sales ANCHOR GLASS: Alpha Resolution Trustee Wants 85 Claims Expunged ANCHOR GLASS: Objects to 47 Various Claims ARMSTRONG WORLD: Discloses Financial Projections for 2006 and 2007 ARMSTRONG WORLD: Professionals Ask for Payment of Fees, Expenses ASARCO LLC: Court Approves LMI Settlement Agreement ASARCO LLC: Willis Gets Paid for Brokerage Services ASG CONSOLIDATED: Moody's Assigns Loss-Given-Default Ratings AVIALL INC: Moody's Withdraws Corporate Family Rating's Ba3 BASIC ENERGY: Moody's Assigns Loss-Given-Default Rating BERRY PLASTICS: Completes Tender Offer for 10.75% Sr. Sub. Notes BERRY PLASTICS: Apollo and Graham Complete BPC Holding Purchase BIOVEST INT'L: Equity Deficit Raises to $12.7MM in Third Quarter BRASKEM SA: Declares Pricing of Tender Offer for 12.50% Notes BRISTOW GROUP: Moody's Assigns Loss-Given-Default Rating BXG RECEIVABLE: Moody's Rates $7.4 Mil. Class F Certs. at Ba2 CALUMET LUBRICANTS: Moody's Assigns Loss-Given-Default Rating CANAL CARTING: Case Summary & 40 Largest Unsecured Creditors CHIQUITA BRANDS: Moody's Assigns Loss-Given-Default Ratings CITIZENS FUNDING: S&P Rates Proposed $100 Mil. Securities at BB+ COLLEEN INC: Ch. 11 Hires Larry Strauss as Accountant COLLEEN INC: Chapter 11 Trustee Hires PENTA as Forensic Accountant COLLINS & AIKMAN: Moody's Assigns Loss-Given-Default Ratings COMMUNICATIONS CORPORATION: Taps Ernst & Young as Auditor COMPUCREDIT ACQUIRED: Moody's Rates $25 Mil. Class B Notes at Ba2 CONEXANT SYSTEMS: Getting $100MM From Acquicor-Jazz Merger CORD BLOOD: Posts $1.2 Million Net Loss in 2006 Second Quarter COUDERT BROTHERS: Files for Chapter 11 Protection in S.D.N.Y. CREDIT SUISSE: Moody's Downgrades Ratings on 7 Certs. to Low-B's CVS CORPORATION: Moody's Affirms Series A-2 Cert.'s Rating at Ba1 DEL MONTE CORP: Moody's Assigns Loss-Given-Default Ratings DELPHI CORP: NuTech Wants Trial to Proceed by February DELPHI CORP: 12,400 UAW Employees to Voluntarily Retire DELTA AIR: Court Approves IBM Outsourcing Pact DELTA AIR: Can Walk Away from Aero Newark Sublease Agreement DENNY'S CORP: Moody's Withdraws B2 Corp. Family Rating DIXIE GROUP: Moody's Assigns Loss-Given-Default Rating DOLE FOOD: Moody's Assigns Loss-Given-Default Ratings EASY GARDENER: Judge Gross Approves Amended Disclosure Statement EASY GARDENER: Exclusive Solicitation Period Extended to Nov. 29 FAREPORT CAPITAL: Inks Pact with Investor to Acquire 60% of Shares FEDERAL-M0GUL: Court Extends Lease Decision Period to Dec. 1 FIRST UNION: Moody's Puts Low-B Ratings on Four Cert. Classes FLYI INC: Various Parties Object to Solicitation Procedures FLYI INC: Contracts and Leases Rejection is Effective Aug. 31 FOAMEX INTERNATIONAL: Asks Court to Disallow Eleven Amended Claims FOAMEX INTERNATIONAL: Gets Okay to Assume Amended EDS Contract FUTRONIX INC: Sibex Buys Bankrupt Assets for $1.38 Million GB HOLDINGS: Creditors' Panel Submits Fourth Modified Ch. 11 Plan GENERAL MOTORS: To Fund Post-Retirement Benefits of Delphi Workers GMAC COMMERCIAL: S&P Raises Class K Certificates' Rating to BB+ GRUPO TMM: Redeems $155,820,539 of Senior Secured Notes Due 2007 GUESS? INC: Enters Into Joint Venture Pact with Mexican Company HENRY BRADFORD: Case Summary & 11 Largest Unsecured Creditors HUSKY ENERGY: Opens Ethanol Production Facility in Lloydminster ICOA INC: June 30 Working Capital Deficit Tops $7.2 Million INDUSTRIAL ENTERPRISES: Responds to Erroneous Schedule 13D Filing INLAND FIBER: Taps Perkins Coie to Assist in Oregon Asset Sale ITEC ENVIRONMENTAL: Hires Rod Rougelot as Chief Executive Officer INTERFACE INC: Moody's Assigns Loss-Given-Default Ratings INTERSTATE BAKERIES: Wants to Sell Portland Property for $3.65MM INTERSTATE BAKERIES: Eyes $2.8 Mil. Wachovia Equipment Purchase JAMES QUILLEN: Case Summary & 19 Largest Unsecured Creditors JMR CONTRACTORS: Case Summary & 20 Largest Unsecured Creditors J.P. MORGAN: Moody's Junks Rating on Class L & M Certs. LEHMAN BROTHERS: Moody's Lowers Class K Note's Rating to Ba2 LEVITZ HOME: Wants to Reject Lease for Store No. 40203 LIFESTYLE ENT: Case Summary & 27 Largest Unsecured Creditors MARSH & MCLENNAN: Names M. Michele Burns as Mercer Chairman, CEO MEDAREX INC: Seeks Default Waiver from 2.25% Sr. Note Holders MEGA BRANDS: Moody's Assigns Loss-Given-Default Ratings MERIDIAN AUTOMOTIVE: Disclosure Statement Hearing Set on Oct. 10 MERIDIAN AUTOMOTIVE: Wants Solicitation Procedures Established MERIDIAN AUTOMOTIVE: Court Okays DIP Financing Amendments MERRIL LYNCH: Moody's Assigns Ba2 Rating to Class B Certificate MEYER'S BAKERIES: Court Sets November 6 as Claims Bar Date METABOLIFE INT'L: PI Claimants Want Stay Lifted to Continue Suit MILLENNIUM BIOTECH: Has $4.5 Million Equity Deficit at June 30 MULTIPLAN INC: Extends Partnership with Health Net MULTIPLAN INC: To Acquire Private Healthcare Systems NATIONSTAR HOME: Moody's Assigns Low-B Ratings on Two Sub. Certs. NAPIER ENVIRONMENTAL: Collects $410,769 from Warrants Excercise NORTHWEST AIRLINES: Hires L.E.K. Consulting as Industry Advisor NORTHWEST AIRLINES: SVP Blames Interest Payment Delays to JPMorgan OWENS CORNING: Bankruptcy Court Approves Plan of Reorganization PLY GEM: Alcoa Merger Cues S&P to Put Ratings on Negative Watch PINNACLE FOODS: Moody's Assigns Loss-Given-Default Ratings POLY-TECH RADIANT: Files for Relief Under Canadian Bankruptcy Act POLYMER GROUP: Moody's Assigns Loss-Given-Default Ratings POLYONE CORPORATION: Fitch Lifts Sr. Unsecured Debts' Rating to B+ PUMPWORKS INC: Involuntary Chapter 11 Case Summary PURE FISHING: Weak Financial Results Cue S&P's Rating Downgrade RADNOR HOLDINGS: U.S. Trustee Wants Chapter 11 Trustee Appointed RAPID LINK: Primary Debt Holders Extend Maturity to November 1 RC2 CORP: Moody's Assigns Loss-Given-Default Ratings REFCO INC: Ch. 11 Trustee Wants Court Nod on Winchester Settlement REFCO INC: Inks Settlement Accord with BofA & Prepetition Lenders RESIDENTIAL ASSET: Moody's Cuts Class M-I-3 Notes' Rating to Caa3 REVLON CONSUMER: S&P Downgrades Corporate Credit Rating to CCC+ ROBERT MULHOLLAND: Voluntary Chapter 11 Case Summary ROWE COS: Gets AMEX Noncompliance Notice Due to Chapter 11 Filing SACO I: Moody's Assigns Ba2 Rating to Class B Subordinated Notes SAINT VINCENTS: Court Approves Asset Sale to St. John's University SAINT VINCENTS: Taps Caronia Corp as Estimation Consultant SATELITES MEXICANOS: Judge Drain Approves Solicitation Procedures SATELITES MEXICANOS: Court Sets Confirmation Hearing on Oct. 26 SPRINGS WINDOW: Moody's Assigns Loss-Given-Default Ratings SUNNY DELIGHT: Moody's Assigns Loss-Given-Default Ratings THOMPSON CREEK: S&P Rates Proposed $125 Million Debt at CCC+ THORNBURG MORTGAGE: Moody's Assigns B2 Rating to Class B-5 Notes TOWER RECORDS: Section 341(a) Meeting Scheduled on Friday TRW AUTOMOTIVE: Fitch Affirms BB Issuer Default Rating TUBULAR TECHNOLOGIES: Loses Lease on Lexington, N.C. Facility UNIFI INC: Moody's Assigns Loss-Given-Default Rating VARIG S.A.: Appeals Court Allows ANAC to Redistribute Routes VARIG S.A.: Cuts Fare on Five Local and Two International Flights VISTEON CORP: Opens $10 Million Technical Center in India WAAG PROPERTIES: Case Summary & 6 Largest Unsecured Creditors WARNER CHILCOTT: Moody's Assigns Loss-Given-Default Rating WATSON PHARMACEUTICALS: Moody's Assigns Loss-Given-Default Rating WELLMAN INC: Consolidating all Fiber Production in Palmetto Plant WINDSOR QUALITY: Moody's Assigns Loss-Given-Default Ratings WINN-DIXIE: Court Okays Assumption of 16 Store Leases WINN-DIXIE: Ct. OKs Rejection of Store # 1059 Lease as of Aug. 31 * A. Kintzinger Joins Public Finance Practice at Hunton & Williams * NatCity Investments buys SSG Capital Advisors * Upcoming Meetings, Conferences and Seminars ********* 1POINT SOLUTIONS: Involuntary Chapter 11 Case Summary ----------------------------------------------------- Alleged Debtor: 1Point Solutions, LLC 101 South Main Street Dickson, TN 37055 Tel: (615) 242-1900 Case Number: 06-05400 Involuntary Petition Date: September 26, 2006 Chapter: 11 Court: Middle District of Tennessee (Nashville) Judge: Keith M. Lundin Petitioners' Counsel: Ronald G. Steen, Jr., Esq. Stites & Harbison PLLC 424 Church Street, Suite 1800 Nashville, TN 37219 Tel: (615) 782-2280 Fax: (615) 742-7238 -- and -- John J. Griffin, Jr., Esq. Kay Griffin Enkema & Brothers PLLC 222 2nd Avenue North, Suite 340M Nashville, TN 37201 Tel: (615) 742-4800 -- and -- John Charles Tishler, Esq. Waller Lansden Dortch & Davis PLLC 511 Union Street, Suite 2700 Nashville, TN 37219 Tel: (615) 850-8756 Fax: (615) 244-6804 -- and -- Sam J. Mcallester, III, Esq. Bone Mcallester Norton, PLLC 511 Union Street, Suite 1600 Nashville, TN 37219 Tel: (615) 238-6320 Fax: (615) 238-6301 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Beck/Arnley Worldparts Corp. Breach of ERISA $6,621,176 2375 Midway Lane Fiduciary Duties; Smyrna, TN 37167 Misappropriation of Plan assets Colbert & Winstead, P.C. Breach of ERISA $547,272 1812 Broadway Fiduciary Duties; Nashville, TN 37203 Misappropriation of Plan assets Reliance Worldwide Corp Breach of ERISA $650,000 dba Cash Acme Fiduciary Duties; c/o Waller Lansden Dortch and Misappropriation of Davis, LLP Plan assets 511 Union Street, 27th Floor Nashville, TN 37219 Tel: (615) 244-6380 Mastrapasqua Asset Management Breach of ERISA $796,989 814 Church Street, Suite 600 Fiduciary Duties; Nashville, TN 37203 Misappropriation of Plan assets A & H PETROLEUM: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: A & H Petroleum, Inc. dba Beverage Warehouse 2500 Green Oaks Blvd. Arlington, TX 76018 Bankruptcy Case No.: 06-43193 Type of Business: The Debtor operates beverage stores. Chapter 11 Petition Date: September 26, 2006 Court: Northern District of Texas (Ft. Worth) Judge: Russell F. Nelms Debtor's Counsel: Eric A. Liepins, Esq. Eric A. Liepins, P.C. 12770 Coit Rd., Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 Fax: (972) 991-5788 Total Assets: $937,500 Total Debts: $2,325,000 Debtor's 8 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Zion National Bank 2500 Green Oaks $1,200,000 P.O. Box 26304 Blvd. ($850,000 Salt Lake City, UT 84126 secured) Amresco SBA Holdings 2500 Green Oaks $1,000,000 c/o Hayne Rake & Repass Blvd. ($850,000 14651 Dallas Parkways secured) Suite 136 ($1,200,000 Dallas, TX 75254 senior lien) EKI'S #3 Corporation 2500 Green Oaks $100,000 4630 Essex Court Blvd. ($850,000 Grand Prairie, TX 75052 secured) ($2,200,000 senior lien) Proton PRC $25,000 4100 Spring Valley Suite 515 Dallas, TX 75244 Arlington ISD Unknown c/o Linebarger Heard 2323 Bryan Street Suite 1600 Dallas, TX 75201 City of Arlington Unknown c/o Linebarger Heard 2323 bryan Street Suite 1600 Dallas, TX 75201 Internal Revenue Service Unknown 1100 Commerce Street Mail Code 5027DAL Dallas, TX 75242 Tarrant County Unknown c/o Linebarger Heard 2323 Bryan Street Suite 1600 Dallas, TX 75201 ADELPHIA COMMS: 12 Creditor Groups Object to Second DS Supplement ----------------------------------------------------------------- Adelphia Communications Corporation and its debtor-affiliates' Second Disclosure Statement Supplement, explaining their Fifth Amended Plan of Reorganization, was objected to by twelve groups of creditors and other parties-in-interest: 1. the Olympus Parent Noteholders: -- Silver Point Capital Fund, L.P., -- Silver Point Capital Offshore Fund, Ltd., -- Redwood Master Fund, Ltd., and -- Goldman Sachs & Co.; 2. certain administrative agents: -- Bank of America, N.A., as the Century Cable Administrative Agent; -- Bank of Montreal, as the Olympus Administrative Agent; and -- Wachovia Bank National Association, as the UCA Administrative Agent; 3. the Ad Hoc Committee of Certain Non-Agent Lenders; 4. the Official Committee of Equity Security Holders of Adelphia Communications Corporation; 5. Calyon New York Branch; 6. Bank of New York, as lender under each of the Credit Agreement prior to Debtor's filing for chapter 11 protection: Century Credit Agreement, the FrontierVision Credit Agreement, the Olympus Credit Agreement and the UCA Credit Agreement; 7. Class action plaintiffs in a lawsuit pending before the United States District Court for the Southern District of New York captioned In re Adelphia Communications Corp. Securities & Deriv. Litigation, 03 MD 1529 (LMM); 8. the Ad Hoc Committee of Non-Agent Secured Lenders; 9. the holders of the Term Note issued by Ft. Myers Acquisition Limited Partnership in the outstanding principal amount of $108,000,000 and secured by an interest in Olympus Communications, L.P. -- the Ft. Myers Noteholders; 10. ACC Senior Noteholders, namely: -- Aurelius Capital Management, LP, -- Catalyst Investment Management Co., LLC, -- Drawbridge Global Macro Advisors LLC, -- Drawbridge Special Opportunities Advisors LLC, -- Elliott Associates, LP, -- Farallon Capital Management LLC, -- Noonday Asset Management LP, and -- Perry Capital LLC; 11. Wilmington Trust Company; and 12. Diana G. Adams, the United States Trustee for Region 2. Generally, the parties complain that the Second Disclosure Statement Supplement fails to provide "adequate information" required under Section 1125 of the Bankruptcy Code. The parties also assert that the Second Supplement relates to an unconfirmable plan because the Fifth Amended Plan violates the "best interests" test, thus the Supplement should not be approved. Representing the Non-Agent Committee, Richard L. Wynne, Esq., at Kirkland & Ellis LLP, in New York, notes that the Plan Proponents themselves admit that the Plan as currently filed is non- confirmable because the ACOM Debtors have insufficient funds to consummate the Plan. He contends that it begs the question of why the plan process should proceed in the face of substantial litigation over a Plan that is insufficiently funded and ultimately cannot be confirmed or consummated. Representing Calyon Bank, Andrew P. Brozman, Esq., at Clifford Chance US LLP, in New York, argues that there are two fundamental failures in the Second Supplement: (1) The liquidation analysis is predicated only upon a hypothetical liquidation of the Debtors as an aggregate whole, bereft of any information as to a Debtor by Debtor analysis or even an "ACC Debtors" by "Subsidiary Debtors" analysis. The analysis, consequently, is flawed as it is useless since no creditor of any particular Debtor can discern whether the Plan for that Debtor is preferable to a Chapter 7 liquidation; and (2) The Plan operates for voting and confirmation purposes on the fiction of creditor classes transcending individual Debtor boundaries. At the same time however, the Plan contemplates confirmation on a Debtor by Debtor basis. The Second Supplement provides no information as to the financial attributes of each Debtor in relation to what creditors in what class assert how much in claims against each Debtor. Accordingly, there exists no information whether any creditor may stand, or how it may intelligently exercise voting rights, in relation to the confirmation process of any Debtor. Representing the Olympus Parent Noteholders, Robert J. Rosenberg, Esq., at Latham & Watkins LLP, in New York, asserts that the Debtors and the Official Committee of Unsecured Creditors should inform them and the Court whether a legal or economic basis exists for the Olympus Parent Noteholders' recoveries to be dramatically reduced as proposed in the Fifth Amended Plan. The Ft. Myers Noteholders note that: -- no indication is given to the basis for a "give up" of $10,000,000; -- no discussion is provided as to the fact that they, unlike other noteholders and parties-in-interest, are secured creditors with substantial rights not recognized in the Plan; and -- no disclosure as to why the treatment for the Ft. Myers Noteholders differs, in materially adverse ways, from the treatment provided to other noteholders, who do not have the benefit of liens and other structural protections. The Equity Committee contends that the Supplement contains inadequate disclosure concerning the Contingent Value Vehicle. It fails to disclose that the Equity Committee's claims against numerous defendant banks cannot be transferred to the CVV absent the Equity Committee's consent, Peter D. Morgenstern, Esq., at Morgenstern Jacobs & Blue, LLC, says. The Administrative Agents' objections to the Disclosure Statement based on inadequate information relate to: (a) exclusivity and the Court's prior Government Settlement Order that prohibit the Debtors from filing a plan of reorganization that withholds payment of principal and interest to the Bank Lenders; (b) partial payment of the Bank Lenders' claims; (c) treatment of third-party claims and rights of non-debtors; (d) voting-related issues; and (e) certain other significant provisions. Martin J. Bienenstock, Esq., at Weil, Gotshal & Manges LLP, in New York, representing the ACC Senior Noteholders, argues that, among others, the Second Statement and the Plan are premature because: -- the exclusivity has not been terminated; -- the alleged $1,080,000,000 to be "transferred" for the benefit of the ACC Creditors is a phony foundation of the Plan; and -- the Plan procedures order is controlling. Representing the Ft. Myers Noteholders, Lee S. Attanasio, Esq., at Sidley Austin LLP, in New York, contends that the Second Supplement fails to disclose the means by which the Plan Proponents intend to confirm the Plan. The Court has authorized the ACC Senior Noteholders and the Ft. Myers Noteholders to file their objections under seal. Judge Gerber finds that the Disclosure Statement Objections contain certain sensitive and confidential information related to discussions in the Monitor process and settlement discussions that have not been made public in accordance with Rule 408 of the Federal Rules of Evidence. Representing the Class Action Plaintiffs, John H. Drucker, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in New York, argues that the Second Supplement should not be approved unless and until, among others: -- the Plan Proponents provide additional and appropriate disclosure with regard to the intent and scope of the exculpation and third party release provisions contained in the Plan. The Second Supplement only repeats verbatim the language in the Plan and provides no additional disclosure necessary for creditors to be able to make an informed decision to reject or accept the Plan; -- there is additional and appropriate disclosure, so that creditors may determine whether in fact the "exculpation provisions" of the Plan are disguised third party releases, and whether those exculpation provisions are intended to provide for releases on account of any acts or omissions prior to the Debtor's filing for chapter 11 protection; -- the Plan Proponents correct the ambiguous and inconsistent language of the Plan regarding exclusions from the otherwise proposed third party releases; -- there is additional and appropriate disclosure with regard to the Plan section relating to the Government Settlement. No explanation has been provided for what is implied by that Section, stating that if the Plan is confirmed, the Court is adding its authority and approval to the efforts of third parties to redirect the distribution of the Restitution Fund under the Government Settlement to non-victims; -- with respect to the distribution and so-called "death trap" provisions of the Plan, the Plan Proponents provide additional and appropriate disclosure as to why: * the holders of Claims in the Class of ACC Existing Securities Law Claims, Class ACC-7, are identified as receiving no distribution on account of their Claims, rather than identified as receiving that distribution to which they would be entitled in accordance with the order of priority provided under the Bankruptcy Code; and * it is appropriate to provide for no distribution to the Class ACC-7 in the event the Class rejects the Plan, but provide a distribution of a subordinated interest in the CVV in the event the class votes in favor of the Plan. That subordinated interest in the CVV is no more than what the Class would be entitled to from a distribution of the assets of the estate in accordance with the priorities provided for under the Bankruptcy Code; -- there is additional and appropriate disclosure as to why, under the Plan, in what is a liquidating Chapter 11 plan, the ACOM Debtors should be entitled to a "discharge," in apparent contravention of Section 1141(d)(3)(B), which prohibits the discharge of a debtor in the circumstances where a debtor does not engage in business after consummation of the Plan; -- there is additional disclosure regarding the basis for the "deemed consent" contained in Plan; and -- the Court denies the Plan Proponents' request for a "presumption that, in the event there is a class of creditors for which no votes are cast accepting or rejecting the Plan, [that] class [will] be deemed to have accepted the Plan." Representing the U.S. Trustee, Tracy Hope Davis, Esq., in New York, asserts that the Disclosure Statement should provide sufficient information regarding the amount of administrative claims and expenses incurred to date by the Settlement Party Fee Claims and the Indenture Trustees' professionals, which are to be paid in accordance with the Plan. Due to the complex debt structure, it is anticipated that the estimates for those claims will be substantial, she contends. JPMorgan's Statement JPMorgan Chase Bank, N.A., administrative agent under the Second Amended And Restated Credit Agreement dated December 19, 1997, informs the Court that it is currently reviewing the Plan with the ACOM Debtors and the Creditors Committee to ensure it accurately reflects the agreement embodied in the FrontierVision Stipulation dated July 27, 2006, providing terms and conditions for withdrawal of JPMorgan's appeal from Sale Order. About Adelphia Communications Corp. 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. 148; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ADELPHIA COMMS: Broadcast Music Agrees to License Pact Rejection ---------------------------------------------------------------- Adelphia Communications Corporation and Broadcast Music, Inc., in a stipulation, agreed that: (1) BMI's objection to the Debtor's notice to reject its Cable Systems Local Origination Music License Agreement, as amended, dated Jan. 1, 2000, with BMI is withdrawn with prejudice; (2) The Debtor rejected the License Agreement effective July 31, 2006; and (3) By Sept. 10, 2006, or ten days after Court approval of the Stipulation, whichever date is later, the Debtor will report and pay any and all license fees due pursuant to the terms of the Agreement for the period from Jan. 1, 2006, through and including July 31, 2006. About Adelphia Communications Corp. 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. 148; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) AGRICORE UNITED: Moody's Assigns Loss-Given-Default Ratings ----------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its Ba3 Corporate Family Rating for Agricore United Ltd. Additionally, Moody's revised or confirmed its probability-of- default ratings and assigned loss-given-default ratings on these loans facilities: Issuer: Agricore United Ltd. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Ba2 Ba2 LGD3 40% Sr. Sec. Term Loan B Due 2013 Ba3 Ba2 LGD3 40% Issuer: AU Holdings Inc. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Term Loan B Ba3 Ba2 LGD3 40% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Headquartered in Winnipeg, Manitoba, Agricore United Limited (TSX: AU.LV, TSE: AU) -- http://www.agricoreunited.com/-- is an agri- business with extensive operations and distribution capabilities across western Canada. The Company's operations are diversified into sales of crop inputs and services, grain merchandising, livestock production services and financial services. AK STEEL: Final Contract Offer Gets "No" Votes from Union Workers ----------------------------------------------------------------- AK Steel Corp.'s locked-out union workers has rejected the Company's final contract offer, the Associated Press reports. The five-year contract offer included wage increases for most workers and job security provisions, and would have allowed workers to keep a fixed pension through the Machinists' multi- employer plan, the union said in the report. The contract also would have required workers to begin paying a share of their health care coverage, and would have had fewer job classifications, giving managers more flexibility in assigning work, the union added. Machinists union local president Brian Daley told the Associated Press that union members distrusted much of the proposal, thinking that their jobs would not be secure, and were opposed to terms that would have increased the Company's ability to outsource work. Mr. Daley further stated that the union also opposed proposed back-to-work conditions that included working with replacements the Company has used to keep the mill running. "It's a matter of members weighing their personal financial condition or taking the risk of a proposal fraught with uncertainties," Mr. Daley said, as quoted in the report. Company spokesman Alan McCoy described the offer as fair and competitive, the source said. The Company has insisted that it needs to cut labor costs to remain competitive in an increasingly global industry in which it is a relatively small player. "We want is to get a competitive labor agreement," Mr. McCoy explained. "Unfortunately for them, the lockout will continue and we'll continue to operate the plant." Since the lockout began, the union work force has shrunk, and according to the union members, hundreds of workers have rushed to retire this month and the work force could be down to 1,800 union workers. Middletown, OH-based AK Steel Corp. -- http://www.aksteel.com/-- produces flat-rolled carbon, stainless and electrical steels, as well as tubular steel products for the automotive, appliance, construction and manufacturing markets. * * * As reported in the Troubled Company Reporter on Feb. 21, 2005, Moody's Investors Service upgraded AK Steel Corporation's debt ratings (Senior Implied to B1 from B2) and affirmed the company's SGL-1 rating. The rating outlook was stable. As reported in the Troubled Company Reporter on July 23, 2004, Standard & Poor's Ratings Services revised its outlook on integrated steel producer AK Steel Corp. to stable from negative. Standard & Poor's also affirmed its 'B+' corporate credit and senior unsecured debt ratings on the company and its parent, AK Steel Holding Corp. ALLIANCE ONE: Moody's Assigns Loss-Given-Default Rating ------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B2 Corporate Family Rating for Alliance One International, Inc., and upgraded its B2 rating on the Company's $300 million senior secured revolver to B1. In addition, Moody's assigned an LGD3 rating to notes, suggesting noteholders will experience a 37% loss in the event of a default. Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Based in Morrisville, North Carolina, Alliance One International, Inc. (NYSE:AOI) -- http://www.aointl.com/-- is a leaf tobacco merchant. ALLIS-CHALMERS: Moody's Assigns Loss-Given-Default Rating --------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refining and marketing sectors this week, the rating agency confirmed its B3 Corporate Family Rating for Allis-Chalmers Energy Inc. Moody's also affirmed its B3 rating on the company's 9% Senior Unsecured Guaranteed Global Notes Due 2014, and assigned the debentures an LGD4 rating suggesting a projected loss-given default of 54%. Moody's explains that current long-term credit ratings are opinions about expected credit loss which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Houston, Texas, Allis-Chalmers Energy Inc. -- http://www.alchenergy.com/-- provides oilfield services and equipment to the oil and gas exploration and development companies primarily in Texas, Louisiana, New Mexico, Colorado, and Oklahoma; offshore in the United States Gulf of Mexico; and offshore and onshore in Mexico. The company offers directional drilling, compressed air drilling, casing and tubing, rental tools, and production services. ALON USA: Moody's Assigns Loss-Given-Default Rating --------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refining and marketing sectors this week, the rating agency raised its Corporate Family Rating for Alon USA Energy Inc. from B2 to B3. Additionally, Moody's raised its rating on the company's Senior Secured Term Loan Due 2013 from B2 to B1. The loan was assigned an LGD2 rating suggesting lenders suggesting lenders will experience a 29% loss in the event of a default. Moody's explains that current long-term credit ratings are opinions about expected credit loss which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Dallas, TX-based Alon USA Energy Inc. -- http://www.alonusa.com/ -- together with its subsidiaries, engages in refining and marketing petroleum products primarily in the southwestern and south central regions of the United States. The company is a subsidiary of Alon Israel Oil Company, Ltd. AMERICAN SEAFOODS: Moody's Assigns Loss-Given-Default Ratings ------------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its B1 Corporate Family Rating for American Seafoods Group LLC. Additionally, Moody's revised or confirmed its probability-of- default ratings and assigned loss-given-default ratings on these loans facilities: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Gtd. Sr. Sec. Revolving Credit Facility Due 2011 B1 Ba3 LGD3 39% Gtd. Sr. Sec. Term Loan A Due 2012 B1 Ba3 LGD3 39% Gtd. Sr. Sec. Term Loan B Due 2013 B1 Ba3 LGD3 39% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). American Seafoods Group LLC -- http://www.americanseafoods.com/-- harvests and processes a variety of fish species aboard its catcher-processor vessels, its freezer-longliner vessels, and at its land-based processing facilities. The Company markets its products to a diverse group of customers in North America, Asia, and Europe. In the U.S., American Seafoods is the largest harvester and at-sea processor of pollock and hake and the largest processor of catfish. The Company also harvests and processes cod, scallops, and yellowfin sole. The Company maintains an international marketing network through its U.S., Japan, and European sales offices. AMES DEP'T: ASM Capital Wants G&A Sales' Admin. Claims Disallowed ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York denied ASM Capital, LP's motion for leave to appeal in Ames Department Stores and its debtor-affiliates' cases, the Troubled Company Reporter disclosed. ASM now asks the Court to enter a supplemental order: -- directing the Debtors to immediately pay ASM's reclamation claim against the Debtors' estate for $33,292; and -- disallowing G&A Sales' administrative claims against the Debtors, which claims are currently held by ASM. Martin P. Ochs, Esq., at Ochs & Goldberg, LLP, in New York, asserts that since the Bankruptcy Court allowed the Reclamation Claim pursuant to an order dated June 13, 2002, the Debtors may not attack the Reclamation Claim on the basis of Section 502(d) of the Bankruptcy Code. In light of the fact that the G&A Adversary Proceeding has now been resolved and the liability of G&A Sales determined, ASM wants the Court to disallow G&A Sales' administrative claims pursuant to Section 502(d). Mr. Ochs adds that the Supplemental Order, if entered, will be a final order, as the liability of G&A has been established. Moreover, ASM will then be in a position to pursue its appeal regarding the issue of Section 502(d)'s applicability to the administration claims, Mr. Ochs says. Ames Department Stores filed for chapter 11 protection on Aug. 20, 2001 (Bankr. S.D.N.Y. Case No. 01-42217). Albert Togut, Esq., Frank A. Oswald, Esq. at Togut, Segal & Segal LLP and Martin J. Bienenstock, Esq., and Warren T. Buhle, Esq., at Weil, Gotshal & Manges LLP represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $1,901,573,000 in assets and $1,558,410,000 in liabilities. (AMES Bankruptcy News, Issue No. 84; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) AMES DEPARTMENT: Obtains Default Judgment Against G&A Sales ----------------------------------------------------------- Ames Merchandising Corporation obtained a default judgment against G&A Sales, Inc., from the U.S. Bankruptcy Court for the Southern District of New York. During the 90-day period before the Debtor filed for bankruptcy, Ames Merchandising made certain transfers to, and for the benefit of, G&A. Barry S. Gold, Esq., at Weil, Gotshal & Manges LLP, in New York, informed the Court that the Avoidable Transfers: * were on account of antecedent debts owed by Ames Merchandising to G&A before the transfers were made; * were made while Ames Merchandising was insolvent; and * enabled G&A to, among others, recover more than it would have received if the Avoidable Transfers had not been made. The Court finds that G&A is in default for failing to plead or otherwise defend in the adversary proceeding. Judge Gerber, hence, enters judgment against G&A in the principal sum of $825,137, plus interest at the rate fixed pursuant to Section 1961 of the Judiciary Procedures Code, from July 3, 2003, until the date that the Order and Judgment of Default is satisfied. Ames Department Stores filed for chapter 11 protection on Aug. 20, 2001 (Bankr. S.D.N.Y. Case No. 01-42217). Albert Togut, Esq., Frank A. Oswald, Esq. at Togut, Segal & Segal LLP and Martin J. Bienenstock, Esq., and Warren T. Buhle, Esq., at Weil, Gotshal & Manges LLP represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $1,901,573,000 in assets and $1,558,410,000 in liabilities. (AMES Bankruptcy News, Issue No. 84; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ANCHOR GLASS: Alpha Resolution Trustee Wants 85 Claims Expunged --------------------------------------------------------------- The Alpha Resolution Trustee asks the U.S. Bankruptcy Court for the Middle District of Florida to expunge, disallow, reclassify or modify 85 Claims filed against Anchor Glass Container Corporation. During the period August 18 to 31, 2006, the Alpha Resolution Trustee disputed 37 claims filed against Anchor Glass Container Corporation by these claimants: Claimant Claim No. -------- --------- Acme Equipment Sales 856.0 Acme Janitor & Chemical Supply 294.1 Air Compressor Supply, Inc. 222.1 Allegheny Power 684.0 American Spotting Co. 1239.0 Aon Consulting 122.0 Baarts Trucking, Inc. 1280.0 Bass Custom Landscapes 1483.0 Baylor Trucking, Inc. 673.0 Benner Industrial 739.0 Benner Mechanical & Electrical 770.0 Besser Lithibar 189.0 Bett A. Way 593.0 Binder Equipment Rental 622.0 Bond Transfer Co., Inc. 871.0 Brahm Trucking Service, Inc. 1279.0 Brehom Compressor 129.0 Bunn Packaging 1038.0 CAP Glass, Inc. 997.0 Eco-Clean Corp 476.0 Eco-Clean Corp 912.0 Eco-Clean of Illinois 912.1 Frank W. Winne & Son, Inc. 1440.0 Ferguson Enterprises, Inc. 169.1 Hacker, Johnson & Smith, P.A. 18.1 Hartness International, Inc. 40.0 James & Kimberly Quirk 1576.0 Kevin R. Heinbaugh 1533.0 Lidestri Foods, Inc. 838.0 Lidestri Foods, Inc. 849.0 Neumann Trucking 205.1 Richard L. Showman 1407.0 Scarlett Facilities Maintenance 203.0 Scarlett Facilities Maintenance 544.0 Scarlett Facilities Maintenance 1484.0 Union Pacific Railroad Company 915.2 Wells Fargo Financial Leasing, Inc. 624.0 The Alpha Trustee also objected to 48 claims, asserting different statuses and claim amounts, filed by these claimants: Claimant Claim No. -------- --------- Arkema, Inc. 1169.0 Arkema, Inc. 1169.1 ATS, Inc. 514.0 ATS, Inc. 514.1 Becker City Sanitation 562.0 Becker City Sanitation 562.1 Buske Lines, Inc. 1311.0 Buske Lines, Inc. 1311.1 Buske Lines, Inc. 1311.2 Dub Wilemon 526.0 Dub Wilemon 526.1 Fayette County Recycling 626.0 Fayette County Recycling 626.1 Gerald B. Collins 569.0 Gerald B. Collins 569.1 Ira and Linda Berry 735.0 Ira and Linda Berry 735.1 James & Dorothy Carpenter 906.0 James & Dorothy Carpenter 906.1 James & Dorothy Carpenter 906.2 James & Dorothy Carpenter 906.3 Mary Hollen 457.0 Mary Hollen 457.1 Millis Transfer, Inc. 91.0 Millis Transfer, Inc. 91.1 Northeast Utilities 65.0 Northeast Utilities 65.1 Onsite Medical Services 230.0 Onsite Medical Services 230 Reflective Recycling of Tulsa 664.0 Reflective Recycling of Tulsa 664.1 Rist Transport, Ltd. 83.0 Rist Transport, Ltd. 83.1 SKJ Facilities Management 762.0 SKJ Facilities Management 762.1 SKJ Facilities Management 762.2 Snapple Beverage Group 1189.0 Snapple Beverage Group 1189.1 Snapple Beverage Group 1189.2 Snapple Beverage Group 1189.4 Somec Corp. 120 Somec Corp. 120.0 Tradewinds Transit, Inc. 646.0 Tradewinds Transit, Inc. 646.1 Triple Crown Services 821.0 Triple Crown Services 821.1 Wenger Truck Line, Inc. 777.0 Wenger Truck Line, Inc. 777.1 Most of the Claims arise from Anchor Glass' retirement benefit plans, employees' severance agreements, and prepetition goods, services, leases and insurance coverages. The Alpha Trustee contends that the Claims should be disallowed, expunged, reclassified or modified for one or more of these reasons: (a) The retirement benefit plans were not affected by the Second Amended Plan of Reorganization; (b) The employees' severance agreements were either rejected before the Petition Date or were paid during the bankruptcy case; (c) The Utilities Claims were paid during the bankruptcy case or in accordance with the Second Amended Plan; (d) The Debtor's books and records do not show that any amounts are due and owing to the Claimants; (e) The Claims do not provide sufficient evidence to support the asserted Claim Amounts; (f) The Claims are duplicative to other claims; (g) The Claims are superseded by other claims; and (h) The Claims were filed after the Bar Date. Anchor Glass has assumed its supply agreement with Lidestri and its executory contract with Arkema, Edward J. Peterson, Esq., at Stichter, Riedel, Blain & Prosser, P.A., in Tampa, Florida, clarifies. The Debtor has cured all defaults owing under the agreements. Thus, Mr. Peterson contends, Lidestri's and Arkema's Claims should be expunged: Claimant Claim No. Claim Amount -------- --------- ------------ Arkema 1169 $91,683 Arkema 1169.1 130,050 Lidestri Foods 838 653,883 Lidestri Foods 849.0 653,883 The Alpha Trustee also asks the Court to reduce the claims filed by Allegheny Power and Baarts Trucking to the amounts reflected in the Debtor's books and records: Reduced Claimant Claim No. Claim Amount Claim Amount -------- --------- ------------ ------------ Allegheny Power 684 $91,091 $68,145 Baarts Trucking 1280 62,180 61,053 Headquartered in Tampa, Florida, Anchor Glass Container Corporation is the third-largest manufacturer of glass containers in the United States. Anchor manufactures a diverse line of flint (clear), amber, green and other colored glass containers for the beer, beverage, food, liquor and flavored alcoholic beverage markets. The Company filed for chapter 11 protection on Aug. 8, 2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano, Esq., at Carlton Fields PA, represents Anchor Glass in its restructuring efforts. Edward J. Peterson, III, Esq., at Bracewell & Guiliani, represents the Official Committee of Unsecured Creditors. When Anchor Glass filed for protection from its creditors, it listed $661.5 million in assets and $666.6 million in debts. The Court confirmed Anchor Glass' second Amended Plan of Reorganization on April 18, 2006. Anchor Glass emerged from Chapter 11 protection on May 3, 2006. (Anchor Glass Bankruptcy News, Issue No. 28; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ANCHOR GLASS: Objects to 47 Various Claims ------------------------------------------ For the period Aug. 21 to 31, 2006, Reorganized Anchor Glass Container Corporation asks the U.S. Bankruptcy Court for the Middle District of Florida to expunge, modify or reclassify 47 claims filed by these claimants: Claimant Claim No. -------- --------- Arnot Medical Services, P.C. 882 Arnot Medical Services, P.C. 882.1 Barbara J. Huey 1010 Carr Lane 348 Charles Decker 620 Charles Decker 620.1 Dennis A. Persons 729 Dennis A. Persons 729.1 Depository Trust Company JP 1500 Depository Trust Company RG 1492 Depository Trust Company RM 1499 Depository Trust Company RW 1443 Depository Trust Company SW 1442 Depository Trust Company WC 1445 Dresser Ind.-Mooney Controls 266 Gary R. Shoemaker 1323 Gary R. Shoemaker 1323.1 Internal Revenue Service 699 Internal Revenue Service 699.1 Josephine Simpson 1206 Kessa A. Smith 56 Lonnie M. Mitchell 1024 Mark Braddock 1090 Mark Braddock 1090.1 Michael J. McCartney, III 712 Minarik Electric Co. 267 Mississippi State Tax Commission 744 Mississippi State Tax Commission 769 Mississippi State Tax Commission 769.1 Mississippi State Tax Commission 769.3 Mississippi State Tax Commission 769.4 Mississippi State Tax Commission 769.5 Morris Pamepinto 1107 Murray County 598 Murray County 598.1 Ohio Bureau of Worker's Compensation 709 Ohio Bureau of Worker's Compensation 940 Ohio Department of Taxation 870 Ohio Department of Taxation 870.1 Raymond Cox 281 Raymond Cox 373 Raymond Cox 373.1 Raymond Cox 560.0 Raymond Cox 560.1 Sowers Dia-Met 13 Sowers Dia-Met 13.1 Space Group, Inc. 477 Several of the Claimants filed multiple claims that assert different statuses and claim amounts. Most of the Claims arise from Anchor Glass' retirement benefit plans, employees' severance agreements, and prepetition goods, services, leases and insurance coverages. Anchor Glass asserts that the Claims should be disallowed, expunged, reclassified or modified for one or more of these reasons: (a) The retirement benefit plans were not affected by the Second Amended Plan of Reorganization; (b) The employees' severance agreements were either rejected before the Petition Date or were paid during the bankruptcy case; (c) The Utilities Claims were paid during the bankruptcy case or in accordance with the Second Amended Plan; (d) Anchor Glass' books and records do not show that any amounts are due and owing to the Claimants; (e) The Claims do not provide sufficient evidence to support the asserted Claim Amounts; (f) The Claims are duplicative to other claims; (g) The Claims are superseded by other claims; and (h) The Claims were filed after the Bar Date. Headquartered in Tampa, Florida, Anchor Glass Container Corporation is the third-largest manufacturer of glass containers in the United States. Anchor manufactures a diverse line of flint (clear), amber, green and other colored glass containers for the beer, beverage, food, liquor and flavored alcoholic beverage markets. The Company filed for chapter 11 protection on Aug. 8, 2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano, Esq., at Carlton Fields PA, represents Anchor Glass in its restructuring efforts. Edward J. Peterson, III, Esq., at Bracewell & Guiliani, represents the Official Committee of Unsecured Creditors. When Anchor Glass filed for protection from its creditors, it listed $661.5 million in assets and $666.6 million in debts. The Court confirmed Anchor Glass' second Amended Plan of Reorganization on April 18, 2006. Anchor Glass emerged from Chapter 11 protection on May 3, 2006. (Anchor Glass Bankruptcy News, Issue No. 28; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARMSTRONG WORLD: Discloses Financial Projections for 2006 and 2007 ------------------------------------------------------------------ Armstrong World Industries, Inc., disclosed financial projections for 2006 and 2007, through a regulatory filing with the Securities and Exchange Commission. Walter T. Gangl, the Debtor's deputy general counsel and assistant secretary, relates that in May 2006, certain holders of unsecured creditor claims against the Debtor sought to pursue negotiations with other creditors with the objective of obtaining a consensual resolution of the Debtor's Chapter 11 case. To facilitate the negotiations, the Debtor provided the claim holders pursuant to confidentiality agreements certain summary projected financial information concerning the Debtor's performance in 2006 and 2007, and a reconciliation of the projected Adjusted EBITDA to the projected Net Operating Income for both years. The Claim Holders, however, were "restricted" from entering into transactions involving securities of the Debtor or its affiliates, Mr. Gangl notes. The Debtor agreed to make the information public on its emergence from Chapter 11. The Holders have asked the Debtor to make the financial information public to end the restrictions on their ability to trade in the securities. Given the recent confirmation of its Chapter 11 Plan, the Debtor agreed and delivered to the SEC a copy of the projected financial information as made available to the Holders. Armstrong World Industries, Inc. Summary of Financial Projections 2006 2007 ---- ---- Net Sales $3,689,700,000 $3,879,500,000 Gross Profit 831,600,000 919,400,000 % of Sales 22.5% 23.7% SG&A Expense 635,200,000 653,800,000 % of Sales 17.2% 16.9% EBIT 228,500,000 299,500,000 % Margin 6.2% 7.7% Adjusted EBITDA 367,000,000 411,000,000 % Margin 9.9% 10.6% Capital Expenditures 134,300,000 134,500,000 % of Sales 3.6% 3.5% POTENTIAL EBITDA ADJUSTMENTS: LTIP $17,100,000 $17,500,000 Retention 3,700,000 3,700,000 Pension Credit (37,800,000) (49,000,000) Gain on Sale of Assets (15,000,000) 0 Restructuring Charges 13,700,000 4,700,000 Other Charges 21,000,000 0 ------------ ----------- TOTAL ADJUSTMENTS $2,700,000 ($23,000,000) Mr. Gangl says EBIT is Net Operating Income as reported. Adjusted EBITDA includes adjustments for gain on sale of assets, LTIP and retention cash payments, pension credit, restructuring charges, and other charges. LTIP, Retention and Restructuring Charges reflect non-recurring cash item adjustments to EBITDA. Gain on Sale of Assets reflects non-cash item adjustments to EBITDA. The $13,700,000 Restructuring Charges for 2006 includes $3,900,000 of cash Restructuring Charges and $9,800,000 of non-cash charges. Other charges relate to cost reduction initiatives. Armstrong World Industries, Inc. Reconciliation to GAAP 2006 2007 ---- ---- Net Operating Income $228,500,000 $299,500,000 ------------ ------------ Depreciation & Amortization 135,800,000 134,500,000 ------------ ------------ EBITDA $364,300,000 $434,000,000 ============ ============ EBITDA Adjustments: LTIP $17,100,000 $17,500,000 Retention Bonus Payments 3,700,000 3,800,000 Pension Credit (37,800,000) (49,000,000) Gain on Sale of Assets (15,000,000) -- Restructuring Charges 13,700,000 4,700,000 Other Charges 21,000,000 -- ------------ ------------ ADJUSTED EBITDA $367,000,000 $411,000,000 ============ ============ Mr. Gangl notes that the LTIP reflects incentive awards payable in 2006 and 2007 under the Company's 1999 Long-Term Incentive Plan, a non-recurring cash item adjustment to EBITDA. The retention bonus payments to be made in 2006 and 2007 under the Debtor's employee retention program are non-recurring cash item adjustments to EBITDA. Pension Credit and Gain on Sale of Assets reflect a non-cash item adjustment to EBITDA. Restructuring Charges reflect non-recurring cash item adjustments to EBITDA, except for the $13,700,000 Restructuring Charges for 2006. According to Mr. Gangl, the Projections were prepared by the Debtor's management in the Spring of 2006, and the assumptions and estimates on which the Projections were based were not disclosed to the Holders. The projected information regarding Net Sales, Gross Profit and Selling, General and Administrative Expenses: * assumed the continued conduct in the ordinary course of the Debtor's operations as they existed at the time the projections were prepared; and * did not include provisions reflecting acquisition or sales of operations that have subsequently occurred or any impact that consummation of the Debtor's Plan of Reorganization would have on the Debtor's results of operations during the projection period, including the effect that adoption of "fresh start accounting" under A.I.C.P.A. Statement of Position 99-1 in connection with consummation of the Plan would have on the Debtor's reported results of operations. Included in the "Potential EBITDA Adjustments" and the projected financial measures are estimates of the effects of certain contemplated, but not all possible, non-recurring transactions and adjustments relating to the Plan of Reorganization or other business initiatives of the Debtor, Mr. Gangl says. The Financial Projections reflect: -- the Debtor's reported financial results through March 31, 2006; and -- the Debtor's estimates at that time of its expected consolidated results of operations for the balance of 2006 and for 2007 based on various assumptions and then-current expectations of the future performance of the Debtor's business and the industry and economic conditions. Mr. Gangl says information contained in the Financial Projections was not prepared in accordance with A.I.C.P.A. or any other professional standards for the preparation or presentation of financial projections and was not reviewed by the Debtor's auditor or any outside expert or advisor. Mr. Gangl cautions investors not to rely on the Projections in making investment decisions regarding securities of the Debtor or its parent company, Armstrong Holdings, Inc. Based 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. The Bankruptcy Court confirmed AWI's plan on Nov. 18, 2003. The District Court Judge Robreno confirmed AWI's Modified Plan on Aug. 14, 2006. The Clerk entered the formal written confirmation order on Aug. 18, 2006. (Armstrong Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARMSTRONG WORLD: Professionals Ask for Payment of Fees, Expenses ---------------------------------------------------------------- Dean M. Trafelet, the legal representative of future claimants, and six bankruptcy professionals retained in Armstrong World Industries, Inc.'s Chapter 11 case, asks the Honorable Eduardo C. Robreno of the U.S. District Court for the Eastern District of Pennsylvania, to direct the payment of $3,212,849 in fees and $419,759 in expenses they incurred in connection with the confirmation of the Debtor's Fourth Amended Plan of Reorganization, as modified. In his role as Future Claimants Representative, Mr. Trafelet incurred $73,320 in fees and $8,800 in expenses from April 7, 2006, to July 12, 2006. The Professionals and their fees and expenses are: Period Professionals Covered Fees Expenses ------------- ------- ---- -------- Analysis, Research & 04/06/06 to Planning Corporation 07/31/06 $307,923 $1,865 Cozen O'Connor 04/06/06 to 07/31/06 30,659 7,177 Kaye Scholer LLP 04/07/06 to 07/11/06 1,714,435 270,756 Richards, Layton & 04/07/06 to Finger, P.A. 07/11/06 24,970 Weil, Gotshal & Manges LLP 04/06/06 to 07/11/06 982,416 62,958 Young Conaway Stargatt 04/07/06 to & Taylor LLP 07/12/06 79,126 68,203 Judge Robreno entered a Fee Order on April 6, 2006, which provided that any application for the allowance of Confirmation-related fees and expenses for the Confirmation Period "will be heard and adjudicated by the District Court". Richards Layton does not seek reimbursement of expenses because it initially understood that the District Court Fee Order apply only to fees. Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, notes that his firm had previously submitted to the Bankruptcy Court requests for reimbursement of expenses incurred during the Confirmation Period. Richards Layton and Weil Gotshal represent the Debtors, while Cozen O' Connor is counsel to the Official Committee of Unsecured Creditors. Kaye Scholer, Young Conaway and ARPC are authorized to provide professional services to Mr. Trafelet as Future Claimants Representative. The firms' services during the Confirmation Period include: (1) preparation for estimation trial and reviewing and filing of pretrial pleadings; (2) attendance at estimation trial; (3) post-trial briefing and closing oral argument; (4) discovery relating to Confirmation; (5) preparation of expert reports and rebuttal reports and analysis of other experts' reports; and (6) analysis of discovery and expert deposition testimony. Based 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. The Bankruptcy Court confirmed AWI's plan on Nov. 18, 2003. The District Court Judge Robreno confirmed AWI's Modified Plan on Aug. 14, 2006. The Clerk entered the formal written confirmation order on Aug. 18, 2006. (Armstrong Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: Court Approves LMI Settlement Agreement --------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi approves in their entirety the Settlement Agreement, the Escrow Agreement, and all other agreements between ASARCO LLC and certain London Market Insurers. As adequate protection for any Contribution Claims that Fireman's Fund Insurance Company may have against the participating LMI, the Court rules that the Contribution Claims are preserved as against the Debtors or any other parties-in-interest, and may asserted as a defense against parties in the Texas Coverage Action. To the extent the Contribution Claims are finally determined to be valid, FFIC's liability to the Debtors will be voluntarily reduced on a dollar-for-dollar basis by the amount of the Contribution Claims. The Court does not require FFIC to name any Participating LMI as party in any pending or future arbitration to enforce the Contribution Claims. The Order is without prejudice to FFIC's rights and claims under its insurance policies issued to the Debtors. FFIC will not seek to assert any Contribution Claims from any Participating LMI, and the Order will not be construed as an acknowledgment that FFIC has Contribution Claims against the Participating LMI, provided that if the Order is found to be ineffective, then FFIC's rights of subrogation against any Participating LMI will be fully preserved. About ASARCO LLC Headquartered in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services and investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. (ASARCO Bankruptcy News, Issue No. 29; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000) ASARCO LLC: Willis Gets Paid for Brokerage Services --------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi approves the payment of Willis of Arizona, Inc.'s fees as ASARCO LLC's insurance broker. ASARCO LLC maintains insurance policies covering all aspects of its business, including workers' compensation, business auto coverage, umbrella liability, directors' and officers' liability, employment practices liability, fiduciary liability, crime, property coverage, cargo program, environmental liability coverage, and storage tank liability. ASARCO is currently addressing its options in connection with its insurance needs, James R. Prince, Esq., at Baker Botts L.L.P., in Dallas, Texas, told the Court. Next year, ASARCO will need to make important business decisions in connection with the insurance policies, including: (a) evaluating their renewal, change and replacement; (b) the undertaking of risk, limit and retention analyses; (c) the completion of loss control analysis; and (d) the review of claims management issues, as needed. ASARCO submitted proposal requests to four different brokers to solicit interest for assistance in managing its insurance portfolio of policies. A consensus recommendation was presented to, and approved by, ASARCO's Board of Directors. Willis of Arizona, Inc., was the recommended broker. The Debtors and Willis entered into an engagement letter, which provides for Willis' service and compensation arrangement for the period Aug. 1, 2006, to Aug. 1, 2007. As insurance broker, Willis will: (a) assess the adequacy of ASARCO's coverages under its current policies and advise of modifications based on the company's risk profile; (b) update ASARCO's insurance underwriting data; (c) assist ASARCO in the preparation of insurance underwriting submission for its review and approval before submission to insurance underwriters; (d) develop, before any policy renewal, a negotiation strategy for meetings with insurance underwriters; (e) in the context of selecting specific coverage, prepare a written summary of all quotes and other disclosures affecting the selected coverage and prepare insurance binders, review and transmit policies to ASARCO; (f) assess the financial soundness of the insurers recommended to provide coverage and, on ASARCO's request, provide a factual analysis of the insurers; (g) review all policies and endorsements delivered by insurers or intermediaries for the purpose of confirming their accuracy and conformity to negotiated specifications and ASARCO's instructions, and advise the company of any changes in the policies; (h) meet with ASARCO's representatives to explain coverage and policies and promptly respond to ASARCO's requests for coverage information and analysis of changing market conditions; (i) assist ASARCO in developing procedures for handling loss exposures and reporting subsequent changes in underwriting information to insurance companies; and (j) inform ASARCO of the reporting requirements for claims, if applicable. ASARCO will pay Willis a $175,000 fee and a performance incentive fee up to $20,000. Willis will be also awarded by the Debtors commissions and fees earned on international placements. The Fees are in addition to the net premium paid for the Coverages. The Base Fee will be paid in equal quarterly installments of $43,750, starting Aug. 1, 2006. The Incentive Fee will be paid by Aug. 1, 2007. Any commission earned on the domestic placements will be offset against the Fees and will be disclosed quarterly. The Willis Engagement Letter provides that either party can terminate their agreement on a 60-day notice. If Willis terminates the Engagement Letter before the expiration of the term, it will be deemed to have fully earned and entitled to a pro rata portion of the Base Fee. If ASARCO terminates the Engagement Letter, Willis will be deemed to have fully earned and be entitled to a portion of the Base Fee: -- 50% if terminated during the first six months; and -- 100% of the Base Fee if terminated after six months. About ASARCO LLC Headquartered in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services and investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. (ASARCO Bankruptcy News, Issue No. 29; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000) ASG CONSOLIDATED: Moody's Assigns Loss-Given-Default Ratings ------------------------------------------------------------ In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its B1 Corporate Family Rating for ASG Consolidated LLC. Moody's revised its probability-of-default rating on the Company's $196 million Senior Discount Global Notes due Nov. 1, 2011, from Caa1 to B3. Additionally, Moody's assigned an LGD6 rating to those notes, suggesting noteholders will experience a 90% loss in the event of a default. Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Seattle, Wash.-based ASG Consolidated LLC is an intermediate holding parent company of American Seafoods Group LLC. American Seafoods Group LLC -- http://www.americanseafoods.com/-- harvests and processes a variety of fish species aboard its catcher-processor vessels, its freezer-longliner vessels, and at its land-based processing facilities. The Company markets its products to a diverse group of customers in North America, Asia, and Europe. In the U.S., American Seafoods is the largest harvester and at-sea processor of pollock and hake and the largest processor of catfish. The Company also harvests and processes cod, scallops, and yellowfin sole. The Company maintains an international marketing network through its U.S., Japan, and European sales offices. AVIALL INC: Moody's Withdraws Corporate Family Rating's Ba3 ----------------------------------------------------------- Moody's Investors Service has withdrawn all ratings assigned to Aviall, Inc. The acquisition of Aviall by The Boeing Company was completed on September 21, 2006, and as part of that transaction the substantial majority of Aviall's outstanding rated notes were repaid under the terms of a tender offer. As a wholly owned subsidiary of Boeing, Aviall will no longer provide independent financial information. The rating has been withdrawn because Moody's believes it lacks adequate information to maintain a rating on any ramaining untendered notes. Outlook Actions: * Issuer: Aviall, Inc. -- Outlook, Changed To Rating Withdrawn From Rating Under Review Withdrawals: * Issuer: Aviall, Inc. -- Corporate Family Rating, Withdrawn, previously rated Ba2 -- Senior Unsecured Regular Bond/Debenture, Withdrawn, previously rated Ba3 Aviall Inc., headquartered in Dallas, TX, is a global provider of new aviation parts to the aerospace market as well as supply chain management to customers in the government/military, general aviation/corporate and commercial aviation sectors. BASIC ENERGY: Moody's Assigns Loss-Given-Default Rating ------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refining and marketing sectors this week, the rating agency confirmed its Ba3 Corporate Family Rating for Basic Energy Services Inc. Moody's also confirmed its B1 rating on the company's 7.125% Senior Unsecured Guaranteed Global Notes Due 2016 and assigned the debentures an LGD4 rating suggesting noteholders will experience a 67% loss in the event of a default. In addition, Moody's raised its rating on the company's Senior Secured Guaranteed Revolving Credit Facility Due 2010 from Ba3 to Baa3 and assigned the loan obligation an LGD2 rating suggesting a projected loss-given default of 12%. Moody's explains that current long-term credit ratings are opinions about expected credit loss which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Midland, Texas, Basic Energy Services, Inc. -- http://www.basicenergyservices.com/-- provides well site services to oil and gas drilling and producing companies in Texas, Louisiana, Oklahoma, New Mexico, and the Rocky Mountain States. BERRY PLASTICS: Completes Tender Offer for 10.75% Sr. Sub. Notes ---------------------------------------------------------------- Berry Plastics Corporation has completed its tender offer and consent solicitation for any and all of its outstanding $335,000,000 aggregate principal amount of 10.75% Senior Subordinated Notes due 2012 (CUSIP No. 085790AJ2) pursuant to the Offer to Purchase and Consent Solicitation Statement dated July 25, 2006, as extended on Aug. 7, 2006 and on Sept. 6, 2006. The offer expired at 12:00 midnight, EST, on Sept. 20, 2006, with $335,000,000 in aggregate principal amount of Notes (100% of outstanding Notes) tendered and accepted for purchase under the terms of the Offer. Deutsche Bank Securities Inc. is the exclusive dealer manager and solicitation agent for the tender offer and consent solicitation. Based in Evansville, Indiana, Berry Plastics Corporation -- http://www.berryplastics.com/-- manufactures and markets rigid plastic packaging products. Berry Plastics provides a wide range of rigid open top and rigid closed top packaging as well as comprehensive packaging solutions to over 12,000 customers, ranging from large multinational corporations to small local businesses. The company has 25 manufacturing facilities worldwide and more than 6,800 employees. * * * As reported in the Troubled Company Reporter on Sept. 26, 2006, Standard & Poor's Ratings Services lowered its corporate credit rating on Berry Plastics to 'B' from 'B+' following successful completion of the acquisition of the company by private equity firms, Apollo Management L.P. and Graham Partners. Standard & Poor's removed the ratings from CreditWatch, where they were placed with negative implications on Aug. 3, 2006. The outlook is stable. As reported in the Troubled Company Reporter on Aug. 7, 2006, Moody's Investors Service confirmed the B3 rating on Berry Plastics Corp.'s $335 million 10.75% senior subordinated notes, due July 15, 2012. BERRY PLASTICS: Apollo and Graham Complete BPC Holding Purchase --------------------------------------------------------------- Berry Plastics Group, Inc., an affiliate of the private equity firms Apollo Management, L.P. and Graham Partners have completed their previously announced acquisition of BPC Holding Corporation, parent of Berry Plastics Corporation, from Goldman Sachs Capital Partners and JPMorgan Partners. Mr. Ira Boots will remain President and Chief Executive Officer and the existing senior management team will continue to lead Berry Plastics. "We are very excited about being acquired by Apollo Management and Graham Partners. Servicing our customers while meeting the needs of our employees, owners and investors will remain our focus. The management skills and packaging sector knowledge provided by Apollo Management and Graham Partners, coupled with the strength of Berry Plastics, will set the trend in leveraged buyouts," said Mr. Boots. "We are grateful for the past successes achieved by Berry Plastics under the leadership of Joe Gleberman, Goldman Sachs Capital Partners, and Mat Lori, CCMP Capital Advisors, LLC." About Apollo Management Apollo Management, L.P., founded in 1990, is among the most active and successful private investments firms in the United States in terms of both number of investment transactions completed and aggregate dollars invested. Since its inception, Apollo has managed the investment of an aggregate of approximately $13 billion in equity capital in a wide variety of industries, both domestically and internationally. About Graham Partners Graham Partners is a middle market industrial private equity firm based in suburban Philadelphia with over $850 million under management. Graham Partners is sponsored by the privately held Graham Group of York, Pennsylvania, an industrial and investment concern with global interests in plastics, packaging, machinery, building products and outsource manufacturing. Graham Partners seeks to acquire industrial companies that participate in growing manufacturing niches where Graham can leverage its unique combination of operating resources and financial expertise. About Berry Plastics Based in Evansville, Indiana, Berry Plastics Corporation -- http://www.berryplastics.com/-- manufactures and markets rigid plastic packaging products. Berry Plastics provides a wide range of rigid open top and rigid closed top packaging as well as comprehensive packaging solutions to over 12,000 customers, ranging from large multinational corporations to small local businesses. The company has 25 manufacturing facilities worldwide and more than 6,800 employees. * * * As reported in the Troubled Company Reporter on Sept. 26, 2006, Standard & Poor's Ratings Services lowered its corporate credit rating on Berry Plastics to 'B' from 'B+' following successful completion of the acquisition of the company by private equity firms, Apollo Management L.P. and Graham Partners. Standard & Poor's removed the ratings from CreditWatch, where they were placed with negative implications on Aug. 3, 2006. The outlook is stable. As reported in the Troubled Company Reporter on Aug. 7, 2006, Moody's Investors Service confirmed the B3 rating on Berry Plastics Corp.'s $335 million 10.75% senior subordinated notes, due July 15, 2012. BIOVEST INT'L: Equity Deficit Raises to $12.7MM in Third Quarter ---------------------------------------------------------------- BioVest International, Inc., reported a $4.1 million net loss on $2 million of net revenues for the three months ended June 30, 2006, compared to a $2.5 million net loss on $1.4 million of revenues in 2005, the Company disclosed in its third quarter financial statements on Form-10QSB filed with the Securities and Exchange Commission. At June 30, 2006, the Company's balance sheet showed $10.8 million in total assets and $23.6 million in total liabilities, resulting in a $12.7 million stockholders' deficit. The Company's equity deficit stood at $5.1 million at Sept. 30, 2005. The Company's June 30 balance sheet also showed strained liquidity with $6.5 million in total current assets available to pay $11.3 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?1258 New Market Tax Credits On April 26, 2006, the Company, through its wholly owned subsidiary, Biovax, Inc., closed a financing transaction that was structured in an effort to obtain certain perceived advantages and enhancements from the New Market Tax Credit regulations adopted under the auspices of the United States Department of the Treasury in 2002 to provide incentive for investing in businesses located in "qualifying census tracts," or areas with a median income below the poverty line. In the Transaction, Biovax entered into a Convertible Loan Agreement where Telesis CDE purchased from Biovax a Subordinated Convertible Promissory Note dated as of April 25, 2006, in the principal amount of $11.5 million. The CDE Loan has a maturity date of Oct. 27, 2013. These parties were involved in the Transaction: Biovax, Accentia Biopharmaceuticals, Inc., the Company's majority shareholder, Biolender, LLC, Telesis CDE Two, LLC, Telesis CDE Corporation, Biovax Investment LLC, U.S. Bancorp Community Investment Corporation, First Bank and Laurus Master Fund, Ltd. Under an Asset Purchase Agreement dated as of April 18, 2006, the Company transferred substantially all of the assets of its vaccine manufacturing business situated at 377 Plantation Street, in Worchester, Massachusetts, and the Company's rights under that lease agreement for the Plant and that letter of intent with the landlord to potentially lease additional space adjacent to the Plant to Biovax. As full purchase price for the Equipment, Biovax paid the Company $1.5 million and assumed certain liabilities, including a portion of a demand note payable to Accentia. In addition, Biovax advanced rental payments for the Leasehold in the amount of $4.5 million. Under the Asset Purchase Agreement, the Company is required to treat the advance as unrestricted and non-segregated funds provided that we shall use the funds to make all required lease payments. Finally, Biovax also hired all of the Company's employees that are related to the vaccine manufacturing business and assumed responsibility for all accrued vacation time and maintenance of existing health and other benefits. Going Concern Doubt Aidman Piser & Co., PA, expressed substantial doubt about BioVest's ability to continue as a going concern after it audited the Company's financial statements for the fiscal years ended Sept. 30, 2005, and 2004. The auditing firm pointed to the Company's significant losses and working capital deficit at Sept. 30, 2005. BioVest International, Inc. -- http://www.biovest.com/-- is a biotechnology company that provides cell culture services to research institutions and the biopharmaceutical industry. BioVest also develops, manufactures and markets cell culture systems. For over 10 years the company has been designated, by the National Institutes of Health, as the National Cell Culture Center. Through its proprietary technology, BioVest provides cell culture services to research institutions, biotechnology companies and the pharmaceutical industry. The company is the holder of a Cooperative Research and Development Agreement with the National Cancer Institute for the commercialization of a personalized biologic therapeutic cancer vaccine for the treatment of non-Hodgkin's lymphoma currently in its phase III pivotal trial. BRASKEM SA: Declares Pricing of Tender Offer for 12.50% Notes ------------------------------------------------------------- Braskem S.A. disclosed the pricing information for its cash tender offer for any and all of its outstanding $275,000,000 principal amount of 12.50% Notes due 2008 (CUSIP Nos.: 10553H AD 4 and 10553J AD 0; ISIN Nos. US10553HAD44 and US10553JAD00; Common Code Nos. 018005328 and 018005484). The tender offer is scheduled to expire at 5:00 p.m., New York City time, today, unless extended or earlier terminated. Settlement of the offer is expected to occur on the third business day following the Expiration Date, which is expected to be Oct. 2, 2006. Braskem will pay the total consideration in the manner described in the Offer to Purchase, dated Aug. 29, 2006, plus accrued and unpaid interest from the last interest payment date to, but excluding, the Settlement Date, for the Notes accepted pursuant to the Offer to Purchase. The total consideration includes an early tender premium in the amount of $20 per $1,000 principal amount of Notes. Noteholders who did not validly tender their Notes prior to 5:00 p.m., New York City time, on Sept. 18, 2006, will receive the tender offer consideration, which does not include the early tender premium. The table below shows the relevant pricing information for the consideration payable for the Notes: Reference U.S. Bloomberg Fixed Spread Actual Reference Treasury Reference Yield Security Page 3-1/8% U.S. PX5 0.450% 4.625% Treasury note due Oct. 15, 2008 Tender Tender Offer Total Offer Consideration Consideration Yield Per $1,000 Per $1,000 Principal Amount Principal Amount of Notes of Notes 5.075% $1,125.48 $1,145.48 The pricing information for the Total Consideration was calculated by the Dealer Managers in the manner described in the Offer to Purchase at 2:00 p.m., New York City time, on Sept. 25, 2006. Braskem has retained ABN AMRO Bank N.V., London Branch, and Citigroup Global Markets Inc. to act as Dealer Managers for the tender offer, JPMorgan Chase Bank, N.A. to act as the depositary for the tender offer, and D.F. King & Co., Inc. to act as information agent for the tender offer. Questions or requests for assistance or additional copies of the Offer to Purchase and the related Letter of Transmittal may be directed to the Information Agent at: D.F. King & Co., Inc. Tel: (800) 290-6431 (toll free) (212) 269-5550)(banks and brokers call collect) Braskem -- http://www.braskem.com.br/-- is a thermoplastic resins producer in Latin American, and is among the three largest Brazilian-owned private industrial companies. The company operates 13 manufacturing plants located throughout Brazil, and has an annual production capacity of 5.8 million tons of resins and other petrochemical products. * * * Standard & Poor's Ratings Services assigned on Sept. 22, 2006, its 'BB' senior unsecured debt rating to the proposed up to $275 million bonds due Jan. 2017 to be issued by Brazil-based petrochemical company Braskem S.A. (BB/Stable/--). The bonds will rank pari passu with the company's other senior unsecured notes. Fitch assigned on Sept. 20, 2006, a rating of 'BB+' to Braskem S.A.'s proposed issuance of $275 million senior unsecured notes due to 2017. The notes are being offered under Rule 144A Regulation S. The proceeds of the offering are expected to be used to prepay existing debts and extend debt maturities. Fitch also maintains foreign currency and local currency Issuer Default Ratings of 'BB+' and a national scale rating of 'AA(bra)' for Braskem. The Rating Outlook is Stable. BRISTOW GROUP: Moody's Assigns Loss-Given-Default Rating -------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refining and marketing sectors this week, the rating agency confirmed its Ba2 Corporate Family Rating for Bristow Group Inc. Moody's also confirmed its Ba2 rating on the company's 6.125% Senior Unsecured Guaranteed Global Notes Due 2013, and assigned the debentures an LGD4 rating suggesting noteholders will experience a 59% loss in the event of a default. Moody's explains that current long-term credit ratings are opinions about expected credit loss which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Houston, Texas, Bristow Group Inc. -- http://www.bristowgroup.com/-- provides helicopter transportation services to the offshore oil and gas industry worldwide. Its services include helicopter transportation, maintenance, search, and rescue and aviation support, as well as oil and gas production management services. The company operates under the brand names of Air Logistics and Bristow Helicopters for its helicopter services, and Grasso Production Management for its production management services. As of March 31, 2006, the company operated 331 aircrafts and its unconsolidated affiliates operated an additional 146 aircrafts. BXG RECEIVABLE: Moody's Rates $7.4 Mil. Class F Certs. at Ba2 ------------------------------------------------------------- Moody's Investors Service assigned a Aaa rating to the senior class of notes issued by BXG Receivables Note Trust 2006-B in Bluegreen Corporation's securitization of timeshare receivables. Moody's also rated Classes B, C, D, E and F Aa2, A2, Baa1, Baa3 and Ba2. The ratings were based on the levels of credit enhancement provided by each of the subordinate classes, the overcollateralization, the reserve fund, the quality of the timeshare receivables, and the structure of the transaction. These are the complete rating actions: * Issuer: BXG Receivables Note Trust 2006-B -- $51.561 mil; Class A, 5.605% Timeshare Loan-Backed Notes, Series 2006-B, Aaa -- $21.879 mil; Class B, 5.704% Timeshare Loan-Backed Notes, Series 2006-B, Aa2 -- $22.338 mil; Class C, 5.952% Timeshare Loan-Backed Notes, Series 2006-B, A2 -- $24.480 mil: Class D, 6.468% Timeshare Loan-Backed Notes, Series 2006-B, Baa1 -- $11.475 mil; Class E, 7.21%, Timeshare Loan Backed Notes, Series 2006-B, Baa3 -- $7.497 mil; Class F, 9.377%, Timeshare Loan Backed Notes, Series 2006-B, Ba2 Bluegreen specializes in drive-to timeshare developments in regional locations. Bluegreen owns or manages 29 resorts. The resorts are in 9 states and in Aruba. The locations of the core resorts are Gatlinburg, Tennessee; Pigeon Forge, Tennessee; North Myrtle Beach and Myrtle Beach, South Carolina; Branson, and Ridgedale Missouri; Gordonsville, Virginia; Wisconsin Dells, Wisconsin; Charleston, South Carolina; Orlando, Florida; near Miami Beach, Florida; Boyne Falls, Michigan; Ormond Beach, Florida; St. Augustine, Florida; Marathon, Florida; Hershey, Pennsylvania; and, Aruba. There are 44 resorts in the Bluegreen Club. Bluegreen, which has senior impled rating of from Moody's with a stable outlook, markets to people with minimum household incomes of $40,000 a year. It estimates that its customer's average annual household income is approximately $70,000, which is less than the industry average. The average outstanding loan balance in the transaction as of the statistical cut-off date of August 15, 2006 was approximately $11,106. The weighted average coupon was approximately 15%.The weighted average term to maturity was 114 months and the weighted average age was 3.9 months. Most of the loans have an original term of 10 years with a minimum required down payment of 10% although, higher down payments lead to a reduction on the interest rate charged on the loan. The resort concentrations in terms of percentages of the aggregate collateral balance as of the statistical cut-off date are not very high with the exception of the Fountains Resort in Orlando which represents over 30% of transaction receivables. By state of residence, the highest obligor concentration is in North Carolina with 11.7%. The concentration of foreign borrowers stands at the statistical cut-off date at below 1.5%. The Class F series 2006-B will be paid interest in each period after all required interest and principal distributions have been made on all the senior classes in all cases. In contrast to the 2005 securitization, there will be no cash accumulation or delinquency triggers. This is due to the strength of the early amortization trigger and of the trigger event (which includes a delinquency test) which lead to the direct distribution of all collections to the notes. The required reserve fund balance as a percentage of the aggregate closing date collateral balance will be at closing 1%, then until month 18 after closing 5% and will decrease by 0.75% after that to reach a floor of 1.5%. Bluegreen Corporation., headquartered in Boca Raton, Florida, has been in the timeshare business since 1994 and is among the top ten sellers of timeshares in the United States. Bluegreen is the servicer in this transaction. CALUMET LUBRICANTS: Moody's Assigns Loss-Given-Default Rating ------------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refining and marketing sectors this week, the rating agency lowered its Corporate Family Rating for Calumet Lubricants Co. Limited Partnership to B3 from B2. Moody's also revised its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Gtd. Term Loan Due 2012 B2 B1 LGD2 26% Sr. Sec. Gtd. Letter of Credit Facility B2 B1 LGD2 26% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Indianapolis, Indiana, Calumet Lubricants Co. Limited Partnership -- http://www.calumetlub.com/-- refines quality specialty hydrocarbon products. CANAL CARTING: Case Summary & 40 Largest Unsecured Creditors ------------------------------------------------------------ Lead Debtor: Canal Carting, Inc. P.O. Box 609 Brooklyn, NY 11231 Bankruptcy Case No.: 06-43526 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- Canal Sanitation, Inc. 06-43527 Type of Business: The Debtor provides waste management services. Chapter 11 Petition Date: September 25, 2006 Court: Eastern District of New York (Brooklyn) Debtor's Counsel: Stephen B. Kass, Esq. Law Offices of Stephen B. Kass, P.C. 225 Broadway - Suite 711 New York, NY 10007 Tel: (212) 843-0050 Fax: (212) 571-0640 Estimated Assets: $500,000 to $1 Million Estimated Debts: $1 Million to $10 Million A. Canal Carting, Inc.'s 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Internal Revenue Service Payroll Tax Debt $1,084,000 Special Procedures Funtio 625 Fulton Street 10 Metrotech Center Brooklyn, NY 11201 NYS Dept. Tax & Finance Payroll & Sales Tax $646,000 Tax Compliance DIV.OOS Debt O.S. Unit Building 8, Room 7 Albany, NY 12227 IESI NY Corp. Vendor Debt $153,177 1099 Wall Street West Lyndhurst, NJ 07071 Local Union 813 Union Benefits $121,930 45-18 Court Square Long Island City, NY 11101 American Recycling Mngm. Vendor Debt $115,758 17233 Douglas Avenue Jamaica, NY 11433 NYS Insurance Fund Workers Compensation $80,000 Worker's Compensation P.O. Box 4788 Syracuse, NY 13221 Approved Oil Vendor Debt $67,323 6741 5th Avenue Brooklyn, NY 11220 CooperTank & Welding Corp Vendor Debt $60,523 215 Moore Street Brooklyn, NY 11206 Transportation Industry Insurance $40,753 P.O Box 1634 Albany, NY 12201 Empire Lube Corp. Vendor Debt $38,866 800 Roosevelt Avenue (Lawsuit Carteret, NJ 07008 Commenced) AICCO, Inc. Insurance $30,571 1001 Winstead Drive Suite 500 Cary, NC 27513 Environmental Control Boa Tickets $16,316 P.O. Box 2307 Peck Slip Station Rd. New York, NY 10272 Gabrielli Truck Sales Vendor Debt $12,111 P.O. Box 5739 Hicksville, NY 11802 NJ Turnpike Authority Accident Claim $11,598 P.O. Box 5042 Woodbridge, NJ 07095 Aramark Uniform Services Vendor Debt $10,166 1060 Gelb Street Union, NJ 07083 BFI Waste Services of NY Vendor Debt $10,116 920 East 132nd Street Bronx, NY 10454 A&A Brake Service Co. Vendor debt $10,060 224 3rd Avenue Brooklyn, NY 11217 Zurich Deductible Insurance $9,847 Recovery Group NW 5608-P.O. Box 1450 Minneapolis, MN 55485 Roth Horowitz, LLC Legal Fees $7,249 150 Morris Avenue Suite 206 Springfield, NJ 07081 NYS Unemployment Insurance Arrears on the $6,065 P.O. Box 4301 unemployment Binghamton, NY 13902 insurance B. Canal Sanitation, Inc.'s 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Internal Revenue Service Payroll Tax Debt $2,687,000 Special Procedures Funtio 625 Fulton Street 10 Metrotech Center Brooklyn, NY 11201 NYS Dept. Tax & Finance Payroll Tax Debt $1,697,000 Tax Compliance DIV.OOS O.S. Unit Building 8, Room 7 Albany, NY 12227 IWS Transfer Systems Vendor debt $711,601 P.O. Box 288 Sloatsburg, NY 10974 Richard's Energy Vendor Debt $117,135 2125 Mill Avenue Brooklyn, NY 11234 NYS Unemployment Insurance Unemployment $102,120 P.O. Box 4301 Insurance Binghamton, NY 13902 National Continental Ins. Insurance $99,334 Caip Underwritting NJ P.O. Box 94921 Cleveland, OH 44101 Hudson County Improvement Vendor Debt $97,777 574 Summit Ave., 5th Floor Jersey City, NJ 07306 Law O. of Roy P. Kozupsky Attorney Fees $25,537 10 East 40th STreet, Suite 1710 New York, NY 10016 Lemeor Vendor Debt $24,469 170-180 Frelinghuysen Ave. Newark, NJ 07114 Life Benefit Plan Employee Benefits $19,500 325 73rd Street Brooklyn, NY 11209 U.S. Department of Tickets $7,850 Transportation 802 Cromwell Park Drive Suite N Glen Burnie, MD 21061 LIE Check Cashing Corp. Bounced Checks $7,673 59-67 55th Road Jamaica, NY 11435 Liberty Mutual Insurance Insurance $7,029 75 Remittance Dr. Suite 1837 Chicago, IL 606751837 Royal Lube Vendor Debt $5,517 180 West Fifth Street Bayonne, NJ 07002 Eastern Organic Resources Vendor Debt $2,975 DBA Woodhue Ltd. 2469 Saylors Pond Road Wrightstown, NJ 08562 Environmental Control Boa Tickets $2,965 P.O. Box 2307 Peck Slip Station Rd. New York, NY 10272 Aramark Uniform Services Vendor Debt $2,473 1060 Gelb Street Union, NJ 07083 P&R Chemical Vendor Debt $1,517 P.O. Box 576 Oceanside, NY 11572 Ace Industrial Supply Vendor Debt $1,207 7535 San Fernando Blvd. Burbank, CA 91505 Mcneilus Truck & Manufacture Vendor Debt $1,126 P.O. Box 219 941 Hemlock Road Morgantown, PA 19543 CHIQUITA BRANDS: Moody's Assigns Loss-Given-Default Ratings ----------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its B2 Corporate Family Rating for Chiquita Brands LLC. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans facilities: Issuer: Chiquita Brands LLC Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Gtd. Sr. Sec. Term Loan B Due 2012 B1 Ba3 LGD2 26% Gtd. Sr. Sec. Term Loan C Due 2012 B1 Ba3 LGD2 26% Gtd. Sr. Sec. Revolving Credit Facility Due 2010 B1 Ba3 LGD2 26% Issuer: Chiquita Brands International, Inc. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Global Notes Due 2014 B3 Caa1 LGD5 89% Sr. Global Notes Due 2015 B3 Caa1 LGD5 89% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Cincinnati, Ohio-based Chiquita Brands International, Inc. (NYSE: CQB) -- http://www.chiquita.com/-- markets and distributes fresh food products including bananas and nutritious blends of green salads. The company markets its products under the Chiquita(R) and Fresh Express(R) premium brands and other related trademarks. Chiquita employs approximately 25,000 people operating in more than 70 countries worldwide. CITIZENS FUNDING: S&P Rates Proposed $100 Mil. Securities at BB+ ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' preferred share rating to the enhanced trust preferred securities ($100 million) proposed by Citizens Funding Trust I, a subsidiary of Citizens Banking Corp. (BBB/Negative/A-2). "We consider the enhanced trust preferred securities to have intermediate-strong equity content under our equity credit framework, and the issue will be included in our calculation of Citizens Banking's capitalization measures up to 15% of adjusted total equity," said Standard & Poor's credit analyst Scott Sprinzen. The two-notch differential between the rating on the issue and the counterparty credit rating on Citizens Banking reflects a one- notch differential for the enhanced trust preferred securities' subordination, and an additional one-notch differential to reflect the heightened payment risk compared with Citizens Banking's debt, owing to the optional deferability of distributions. The equity content of the enhanced trust preferred securities results from long-dated maturity, subordination, and deferability of distributions. The underlying junior subordinated debentures have a maturity date of 2066. The issue is redeemable starting in 2011, and although there is a legally enforceable covenant, which requires that the issue only be redeemed using the previously raised proceeds of equity-like qualifying securities (as defined), this covenant expires in 2036. Although Standard & Poor's views the potential for an early redemption as a weakness of the issue, the rating agency takes comfort from the fact that under the Federal Reserve's existing risk-based capital guidelines applicable to bank holding companies, any redemption by Citizens Banking of the junior subordinated debentures before their maturity in 2066 would require the previous approval of the Federal Reserve. The underlying junior subordinated debentures are subordinated to all existing debt of Citizens Financial. Citizens Financial has the right to defer distributions on one or more occasions, for up to 10 years, without giving rise to an event of default and acceleration. Citizens Funding Trust I: Ratings Assigned: * Enhanced trust preferred securities at BB+ COLLEEN INC: Ch. 11 Hires Larry Strauss as Accountant ----------------------------------------------------- The Honorable Nancy V. Alquist of the U.S. Bankruptcy Court for the District of Maryland in Baltimore authorized Zvi Guttman, the Chapter 11 Trustee for the bankruptcy estate of Colleen, Inc., to retain Larry I. Strauss, CPA, as his accountant. Mr. Guttman told the Court that the employment of an accountant is necessary for the efficient administration of the Debtor's case and to comply with Federal and State tax laws. Mr. Strauss will also help the Trustee determine the Debtor's income or loss, prepare and file necessary monthly, quarterly and annual tax returns and comply with U.S. Trustee reporting requirements. Mr. Strauss will charge $195 per hour for his services. The hourly rates for other professionals at Mr. Strauss' firm are: Designation Hourly Rate ----------- ----------- Sr. Accountant $110 Staff $85 To the best of the Trustee's knowledge, Mr. Strauss does not hold or represent any interest adverse to the Debtor's estate. Based in Baltimore, Maryland, Colleen, Inc., aka A & B Check Cashing -- http://www.abcheckcashing.com/-- specializes in cashing in all types of checks, and provides other financial services. The Debtor filed for Chapter 11 protection on June 28, 2006 (Bankr. Dist. Md. Case No.: 06-13748). In August 2006, the Court appointed Zvi Guttman as the Debtor's Chapter 11 Trustee. Kristen B. Perry, Esq., and Brent C. Strickland, Esq., at Whiteford, Taylor & Preston LLP, represents the Chapter 11 Trustee. When the Debtor sought protection from its creditors, it disclosed assets of $467,000 and debts totaling $11,800,000. COLLEEN INC: Chapter 11 Trustee Hires PENTA as Forensic Accountant ------------------------------------------------------------------ The Honorable Nancy V. Alquist of the U.S. Bankruptcy Court for the District of Maryland in Baltimore allowed Zvi Guttman, the Chapter 11 Trustee for the bankruptcy estate of Colleen, Inc., to employ PENTA Advisory Services, LLC, as his Forensic Accountant and Financial Consultant. Prior to the filing of its Bankruptcy case, the Debtor operated a check cashing businesses at 20 locations throughout the Baltimore region. On June 23, 2006, following the suicide of one of its principals and amid rumors of a check kiting scheme resulting in over $10,000,000 in losses, the Debtor ceased operations. In this engagement, PENTA will: a) investigate and analyze transactions of the Debtor to identify potential recoveries for the estate; b) assist the Chapter 11 Trustee in securing the Debtor's relevant books and records; and c) perform other tasks as requested by the Chapter 11 Trustee. Mr. Guttman selected PENTA because the firm has established a group that specializes in serving financially troubled companies. The current hourly rates for PENTA's professionals are: Designation Hourly Rate ----------- ----------- Managing Directors $420 - $470 Directors $400 - $410 Principals $270 - $350 Senior Engagement Managers $220 - $300 Senior Consultants $190 - $275 Consultants $180 - $195 Analysts $170 - $180 Administrative $80 Charles R. Goldstein, a Managing Director within PENTA, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, and represents or holds no interest adverse to the Debtor's estate. Based in Baltimore, Maryland, Colleen, Inc., aka A & B Check Cashing -- http://www.abcheckcashing.com/-- specializes in cashing in all types of checks, and provides other financial services. The Debtor filed for Chapter 11 protection on June 28, 2006 (Bankr. Dist. Md. Case No.: 06-13748). In August 2006, the Court appointed Zvi Guttman as the Debtor's Chapter 11 Trustee. Kristen B. Perry, Esq., and Brent C. Strickland, Esq., at Whiteford, Taylor & Preston LLP, represents the Chapter 11 Trustee. When the Debtor sought protection from its creditors, it disclosed assets of $467,000 and debts totaling $11,800,000. COLLINS & AIKMAN: Moody's Assigns Loss-Given-Default Ratings ------------------------------------------------------------ In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B2 Corporate Family Rating for Collins & Aikman Floorcoverings, Inc. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $50 million Sr. Secured Revolver B1 Ba2 LGD2 14% $31 million Sr. Secured Term Loan B1 Ba2 LGD2 14% $165 million 9.75% Sr. Sub. Notes due 2010 Caa1 B3 LGD4 69% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Dalton, Georgia, Collins & Aikman Floorcoverings, Inc. -- http://cafloorcoverings.com/-- manufactures commercial carpeting for corporate, education, government, healthcare and retailing entities worldwide. It makes modular tile and six-foot structured back carpeting for the commercial market. The Company also manufactures 100% recycled-content secondary backing. It also has proprietary closed-loop carpet reclamation and recycling programs. The Company is a part of commercial floorcoverings manufacturer Tandus Group, and works in tandem with sister brands Monterey and Crossley. COMMUNICATIONS CORPORATION: Taps Ernst & Young as Auditor --------------------------------------------------------- Communications Corporation of America and its debtor-affiliates and White Knight Holdings, Inc., and its debtor-affiliates, ask the U.S. Bankruptcy Court for the Western District of Louisiana for permission to employ Ernst & Young LLP as their auditor. Ernst & Young will: (a) audit and report on each of the Debtors' respective consolidated financial statement for the year ending Dec. 31, 2005, with the objective of E&Y's audits being to express opinions on the fairness, in all material respects, of the presentation of the Debtors' consolidated financial statements in conformity with accounting principles generally accepted in the U.S.; and (b) perform research and engage in consultations with the Debtors regarding financial accounting and reporting matters on an as-needed basis. The Debtors tell the Court that the firm's professionals bill: Professional Hourly Rate ------------ ----------- Partners & Executive Directors $495 - $580 Senior Manager/Manager $350 - $425 Senior $200 - $275 Staff $150 - $190 To the best of the Debtors' knowledge, Ernst & Young is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About White Knight Headquartered in Lafayette, Louisiana, White Knight Holdings, Inc., is a media, television and broadcasting company. White Knight entered into commercial inventory agreements, joint sales agreements, and shared services agreements with Communications Corporation of America. However, both entities are independent companies and are not affiliates of each other. Along with Communications Corp., White Knight operates around 23 TV stations. White Knight and five of its affiliates filed for chapter 11 protection on June 7, 2006 (Bankr. W.D. La. Case Nos. 06-50422 through 06-50427). R. Patrick Vance, Esq., and Matthew T. Brown, Esq., at Jones, Walker, Waechter, Poitevent, Carrere & Denegre, LLP, represents White Knight and its debtor-affiliates in their restructuring efforts. White Knight and its debtor-affiliates' chapter 11 cases are jointly administered under Communication Corporation of America's chapter 11 case. When White Knight and its debtor-affiliates filed for protection from their creditor, they estimated less than $50,000 in assets and estimated debts between $100,000 and $500,000. About Communications Corp. of America Headquartered in Lafayette, Louisiana, Communications Corporation of America, is a media and broadcasting company. Along with media company White Knight Holdings, Inc., it owns and operates around 23 TV stations in Indiana, Texas and Louisiana. Communications Corporation and 10 of its affiliates filed for bankruptcy protection on June 7, 2006 (Bankr. W.D. La. Case Nos. 06-50410 through 06-50421). Douglas S. Draper, Esq., William H. Patrick III, Esq., and Tristan Manthey, Esq., at Heller, Draper, Hayden, Patrick & Horn, LLC, represents Communications Corporation and its debtor-affiliates. When Communications Corporation and its debtor-affiliates filed for protection from their creditors, they estimated assets and debts of more than $100 million. COMPUCREDIT ACQUIRED: Moody's Rates $25 Mil. Class B Notes at Ba2 ----------------------------------------------------------------- Moody's Investors Service rated several classes of notes issued from the CompuCredit Acquired Portfolio Voltage Master Business Trust, Series 2006-1. The ratings are based on the credit quality of the underlying credit card receivables, the experience of CompuCredit Corporation as servicer, the existence of a back-up servicing agreement, and the transaction's structural protections, which include rapid amortization triggers and credit enhancement through subordination. These are the complete rating actions: * Issuer: CompuCredit Acquired Portfolio Voltage Master Business Trust -- $210,500,000 Series 2006-1 Class A-1 Notes, rated Aaa; -- $50,000,000 Series 2006-1 Class A-2 Notes, rated Aa2; -- $45,000,000 Series 2006-1 Class A-3 Notes, rated A2; -- $85,000,000 Series 2006-1 Class A-4 Notes, rated Baa2; -- $25,000,000 Series 2006-1 Class B Notes, rated Ba2. Background The portfolio of well-seasoned, mostly sub-prime general purpose VISA and MasterCard credit card receivables was originated by Circuit City's bank subsidiary, First North America National Bank. FNANB sold the portfolio to Fleet in 2003. Fleet then merged with Bank of America and, in November 2004, sold the billion portfolio to Transistor Holdings, LLC. Transistor Holdings is a Delaware limited liability company with three members of equal ownership. These members are: * CSC Acquisition, LLC, a subsidiary of CompuCredit; * Blue Ridge Investments, LLC, an affiliate of Banc of America Securities LLC, and * Greenwich Capital Financial Products, Inc., an affiliate of Greenwich Capital Markets, Inc. Conductor LLC is the transferor of the receivables to the Trust and is domiciled in Nevada. Conductor is a wholly owned subsidiary of Transistor Holdings and Transistor Holdings is the sole member of Conductor. The Trust will issue only two series: Series 2006-1 and a variable funding note. The partially amortizing trust structure reflects management's aim to reduce the portfolio balance over time. Collateral description The collateral backing the notes are unsecured bankcard credit card receivables issued to obligors of generally below-average credit quality. For example, as of July 1, 2006, the weighted average FICO score for the securitized pool was 639, the average credit line was $5,317 and the average balance $1,738. The portfolio is well-seasoned -- more than 97% of the receivables were generated on accounts originated before 2003. Also, as of July 31, 2006, the Trust contained approximately $528 million in receivables owed on approximately 304,000 accounts. Performance of the portfolio reflects the sub-prime nature of the receivables. Trusts backed by sub-prime receivables typically have higher charge-off rates, higher yield and lower principal payment rates than trusts that are backed by prime credit card receivables. Partially amortizing structure In contrast to most credit card receivable-backed transactions, which revolve for a pre-determined period of time before maturity, the Series 2006-1 bonds employ a partially amortizing structure. Essentially, from the closing date, allocable cash flows will be used to both fund new purchases and to repay principal to investors. The amount and priority of these allocations depend on pre-determined triggers based on minimum subordination requirements, among other things. If principal payments are insufficient to cover new purchases, a VFN may be drawn upon to an agreed upon limit. The allocation of principal collections fall into four distinct periods, each of which has distinct payment allocations to noteholders, including the VFN. Subordination levels relative to the Class A notes, among other things, is a key factor in determining which of the four periods is applicable. Compucredit's role Among the three owners of Transistor Holdings, CompuCredit (not rated), the parent of CSC Acquisition, LLC, retains the key operational experience for underwriting, collecting and servicing credit card receivables. CompuCredit is the servicer and administrator for the Trust. Experienced originator and servicer, reliant on securitization CompuCredit is an originator and servicer of sub-prime credit card receivables. The Company began issuing credit cards in 1997 and, through both new originations and acquisitions, has grown rapidly. With limited access to other funding sources, the company heavily relies on the securitization market as a source of liquidity and financing. In April 1999, CompuCredit went public and started trading on the Nasdaq under the ticker symbol "CCRT". In April 2002, CompuCredit hired BDO Seidman LLP as its independent auditor to replace Ernst & Young LLP. Experienced securitizer CompuCredit has several other securitization vehicles of its own. CompuCredit-originated receivables are securitized in the CompuCredit Card Master Note Business Trust, and acquired portfolios have been securitized through the jointly-owned Pass- through Amortizing Credit Card Trusts, the FMT Amortizing Note Business Trust, and the CompuCredit Credit Card Acquired Portfolio Business Trust. Third party account ownership. CompuCredit does not own a bank and, without a bank charter, cannot originate credit card accounts. Instead, for this portfolio of accounts, FNBO owns the credit card accounts (CompuCredit has a similar relationship with other account owners. Columbus Bank & Trust is CompuCredit's principal third-party credit card originating financial institution). Receivables that arise on such accounts are purchased each day by a wholly owned subsidiary of Transistor Holdings, Transistor LLC. If Transistor LLC is not able to purchase or fund these receivables, FNBO may revoke cardholders' charging privileges. FNBO's account ownership agreement expires six years after the closing date. If FNBO does not extend its term and account ownership cannot be transferred to a successor bank, the accounts will likely be closed (i.e. cardholders' charging privileges will be revoked), which will likely have an adverse impact on collateral performance. In September 2005, the Company announced its intention to merge with CardWorks, Inc., a privately held issuer and third-party servicer of consumer credit card receivables through its subsidiary Merrick Bank Corporation, a Utah industrial loan bank. The CardWorks acquisition is subject to customary closing conditions, including regulatory approvals. This merger is still pending due primarily to an FDIC-imposed moratorium (until January 2007) on approving acquisitions of industrial loan charters. Regulatory actions In June 2006, CompuCredit entered into a settlement agreement with the New York Attorney General's Office to resolve an investigation into CompuCredit's marketing, servicing and collection practices. In addition, the FDIC is currently investigating the policies, practices and procedures that CompuCredit uses in connection with Columbus Bank & Trust. Back-up servicer Upon the occurrence of certain events, FNBO is contracted to take over servicing for the transaction from CompuCredit. FNBO is an experienced originator and servicer of consumer credit cards. FNBO has a senior unsecured deposit rating of Baa2 and a servicer quality rating of SQ3-. The Class A and Class B notes were sold without registration under the Securities Act of 1933 under circumstances designed to preclude a distribution thereof in violation of the Act and that the issuance has been designed to permit resale under rule 144A CONEXANT SYSTEMS: Getting $100MM From Acquicor-Jazz Merger ---------------------------------------------------------- Conexant Systems, Inc., expects to receive cash proceeds of approximately $100 million when Acquicor Technology, Inc., a special purpose acquisition company, completes its merger with Jazz Semiconductor, Inc., a privately held specialty wafer manufacturing company. Under the terms of the definitive agreement, Jazz will merge with a wholly owned subsidiary of Acquicor in an all-cash transaction valued at $260 million, subject to certain adjustments. Completion of the merger is expected to occur in the first quarter of calendar 2007. Conexant owns approximately 42% of Jazz, a wafer foundry that provides advanced specialty process technologies for the manufacture of highly integrated analog and mixed-signal semiconductor devices. Jazz was formed in March 2002 as a joint venture between Conexant and The Carlyle Group, a leading global private equity firm. Conexant contributed its specialty process technologies and the manufacturing equipment in its Newport Beach wafer fabrication facility to the joint venture in return for its stake in the new company. Prior to that, the Newport Beach fabrication facility was wholly owned by Conexant. Jazz's initial customers consisted of Conexant and Skyworks Solutions, Inc., a publicly traded company created from the spin- off of Conexant's wireless business and the merger with Alpha Industries in June 2002. Since then, Jazz has successfully expanded and diversified its customer base. These new customers include Freescale Semiconductor, Inc., Marvell Technology Group Ltd., Texas Instruments, Inc., and RF Micro Devices, Inc. "Jazz has been an important supplier for Conexant since its inception, and I expect our relationship to continue," said Dwight W. Decker, Conexant chairman and chief executive officer. "Over the past four years, the Jazz team has consistently made outstanding progress on all fronts in a highly competitive environment. The company began manufacturing for just Conexant and its spin-off companies and is now a supplier to almost 100 new customers from all over the industry. I expect that the merged company and senior management team will continue to build on this record of success." "From a Conexant perspective, our share of the proceeds from this transaction will significantly strengthen our balance sheet and provide us with improved liquidity," Mr. Decker added. Conexant expects to record a modest gain when the Acquicor-Jazz transaction closes. Headquartered in Newport Beach, California, Conexant Systems, Inc. (NASDAQ: CNXT) -- http://www.conexant.com/-- is a fables semiconductor company. The company has approximately 2,400 employees worldwide. * * * As reported in the Troubled Company Reporter on Dec. 20, 2004, Standard & Poor's Ratings Services lowered its corporate credit rating on Newport Beach, California-based Conexant Systems, Inc., to 'B-' from 'B' on projections of sharply reduced sales and profitability over the next few quarters. The outlook is negative. CORD BLOOD: Posts $1.2 Million Net Loss in 2006 Second Quarter -------------------------------------------------------------- Cord Blood America, Inc., reported a $1.2 million net loss on $1 million of net revenues for the three months ended June 30, 2006, compared to a $1.2 million net loss on $665,582 of revenues in 2005. At June 30, 2006, the Company's balance sheet showed $1,010,531 in total assets and $6,231,875 in total liabilities, resulting in a $5,221,344 stockholders' deficit. The Company's June 30 balance sheet also showed strained liquidity with $563,860 in total current assets available to pay $1,027,218 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?1254 Going Concern Doubt Rose, Snyder & Jacobs, in Encino, California, raised substantial doubt about Cord Blood 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 auditing firm pointed to the Company's recurring operating losses, insufficient working capital, and accumulated deficit. Headquartered in West Hollywood, California, Cord Blood America, Inc. (OTCBB:CBAI) -- http://www.cordblood-america.com/-- is the parent company of Cord Partners, which facilitates umbilical cord blood stem cell preservation for expectant parents and their children. Its mission is to be the most respected stem cell preservation company in the industry. Collected through a safe and non-invasive process, cord blood stem cells offer a powerful and potentially life-saving resource for treating a growing number of ailments, including cancer, leukemia, blood, and immune disorders. COUDERT BROTHERS: Files for Chapter 11 Protection in S.D.N.Y. ------------------------------------------------------------- International law firm Coudert Brothers LLP has filed for bankruptcy protection after losing two lawsuits, Patrick Fitzgerald at The Wall Street Journal reports. According to the Journal, one of the lawsuits relate to a $2.5 million malpractice suit filed by one of the firm's former clients. Coudert also faces a host of other malpractice suits as well as actions by former partners, creditors and landlords. Mr. Fitzgerald, citing court filings, says that the firm's executive director, Patricia Kane, has claimed that Coudert doesn't have the money to pay for the judgment. Ms. Kane has also accused certain former Coudert partners of siphoning over $1.5 million of the firm's funds into their private accounts. Coudert decided to wind down its practice last year after a proposed merger with Baker & McKenzie failed to materialize, the American Bankruptcy Institute reports. About Coudert Coudert Brothers LLP -- was an international law firm specializing in complex cross border transactions and dispute resolution. The Debtor filed for Chapter 11 protection on Sept. 22, 2006 (Bankr. S.D. N.Y. Case No. 06-12226). Tracy L. Klestadt, Esq., at Klestadt & Winters, LLP, represents the Debtor. When it filed for bankruptcy, Coudert estimated its assets and debts at between $10 million to $50 million. CREDIT SUISSE: Moody's Downgrades Ratings on 7 Certs. to Low-B's ---------------------------------------------------------------- Moody's Investors Service has upgraded the ratings of nine tranches issued by CSFB Home Equity Asset Trust in 2003 while downgrading eight others. Moody's has also confirmed three ratings which had previously been on review for possible upgrade. Three tranches have been placed on review for possible downgrade. Each of these deals is primarily backed by first-lien, subprime fixed and adjustable rate mortgage loans. For each transaction being downgraded, the event of step-down has adversely affected the amount of credit enhancement available to the subordinate bonds despite lower than anticipated losses to date. Increases in Libor coupled with delayed resets on the mortgage pools have contributed to diminishing levels of excess spread. The recent pace of losses has, in some instances, begun to erode overcollateralization. The tranches being upgraded are considered to be adequately enhanced against future deteriorations in performance and support. These are Moody's complete rating actions: * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-1 -- Cl. M-1, Previously: Aa2; upgraded to Aa1, -- Cl. M-2, Previously: A1; upgraded to Aa3, -- Cl. M-3, Previously: A2; upgraded to A1, -- Cl. B-2, Previously: Baa2; downgraded to Ba1, -- Cl. B-3, Previously: Baa3; downgraded to B1. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-2 -- Cl. M-1, Confirmed: Aa2, -- Cl. M-2, Confirmed: A1, -- Cl. M-3, Confirmed: A2, -- Cl. B-1, Previously: Baa1; downgraded to Baa3, -- Cl. B-2, Previously: Baa2; downgraded to B1. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-3 -- Cl. M-1, Previously: Aa2; upgraded to Aa1, -- Cl. M-2, Previously: A2; upgraded to A1, -- Cl. M-3, Previously: A3; upgraded to A2, -- Cl. B-2, Previously: Baa2; downgraded to Ba2, -- Cl. B-3, Previously: Baa3; downgraded to Ba3. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-4 -- Cl. M-1, Previously: Aa2; upgraded to Aaa, -- Cl. M-2, Previously: A2; upgraded to Aa2, -- Cl. M-3, Previously: A3; upgraded to Aa3, -- Cl. B-2, Previously: Baa2; downgraded to Ba1, -- Cl. B-3, Previously: Baa3; downgraded to Ba3. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-5 -- Cl. B-3, Currently Baa3; on review for possible downgrade. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-6 -- Cl. B-3, Currently Baa3; on review for possible downgrade. * Issuer: Credit Suisse First Boston Mortgage Securities Corp. Series 2003-7 -- Cl. B-3, Currently Baa3; on review for possible downgrade. CVS CORPORATION: Moody's Affirms Series A-2 Cert.'s Rating at Ba1 ----------------------------------------------------------------- Moody's Investors Service downgraded the ratings of seven securities and confirmed the rating of one security supported by CVS Corporation lease obligations: * CVS Credit Lease Backed Pass-Through Certificates -- Series A-1, $158,700,000, downgraded to Baa2 from Baa1 -- Series A-2, $125,000,000, confirmed at Ba1 * CVS Lease-Backed Pass-Through Certificates -- Series 2001, $244,176,492, downgraded to Baa2 from Baa1 * CVS Lease-Backed Pass-Through Certificates -- Series 2002-1, $247,586,347, downgraded to Baa2 from Baa1 * CVS Lease-Backed Pass-Through Certificates -- Series 2003-1, $118,403,106, downgraded to Baa2 from Baa1 * CVS Leased-Backed Pass-Through Certificates -- Series 2003-2, $269,455,748, downgraded to Baa2 from Baa1 * CVS Lease-Backed Pass-Through Certificates -- Series 2004-1, $478,704,616, downgraded to Baa2 from Baa1 * CVS Lease-Backed Pass-Through Certificates -- Series 2005-1, $380,697,783, downgraded to Baa2 from Baa1 The downgrades were prompted by CVS's senior unsecured debt rating being downgraded to Baa2 from Baa1. Moody's stated that the key drivers of the rating downgrade are: (1) the belief that credit metrics for CVS will deteriorate because of the company's intention to finance with incremental short-term debt for the purchase of 703 stand- alone drug stores from Albertson's, Inc. for total consideration of about $4 billion and (2) the material increase in business risk that will result from the transaction. The CVS corporate rating outlook is stable. The CVS Credit Lease-Backed Pass-Through Certificates, Series A-1 and A-2 transaction is a combination credit tenant lease and surety backed transaction. Payments on the CVS leases are sufficient to pay all interest and approximately 44% of the principal of the Class A-2 Certificates. The remaining principal of the A-2 Certificates is insured under residual value insurance policies issued by Financial Structures Limited and reinsured by Royal Indemnity Company. While the CVS corporate downgrade puts some negative rating pressure on Class A-2, it is not sufficient to warrant a downgrade. Moody's is therefore confirming Class A- 2. Headquartered in Woonsocket, Rhode Island, CVS currently operates about 5,500 drug stores in 37 states and the District of Columbia. The completed transaction, the company will add about 700 stand- alone drug stores that are currently operated by Albertson's Inc. DEL MONTE CORP: Moody's Assigns Loss-Given-Default Ratings ---------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its Ba3 Corporate Family Rating for Del Monte Corporation. Additionally, Moody's revised or confirmed its probability-of- default ratings and assigned loss-given-default ratings on these loans facilities: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Gtd. Sr. Sec. Revolving Credit Facility Due 2011 Ba3 Ba2 LGD2 29% Gtd. Sr. Sec. Term Loan A Due 2011 Ba3 Ba2 LGD2 29% Gtd. Sr. Sec. Term Loan B Due 2012 Ba3 Ba2 LGD2 29% Gtd. Sr. Sec. Term Loan B Due 2012 Ba3 Ba2 LGD2 29% Gtd. Sr. Sec. Term Loan B Due 2012 Ba3 Ba2 LGD2 29% Gtd. Sr. Sub. Global Notes Due 2012 B2 B2 LGD5 83% Gtd. Sr. Sub. Global Notes Due 2015 B2 B2 LGD5 83% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Del Monte Corporation is a wholly owned subsidiary of Del Monte Foods Company. Del Monte Foods Company (NYSE: DLM) -- http://www.delmonte.com/-- produces, distributes and markets food and pet products for the U.S. retail market. A portfolio of brands include Del Monte(R), Contadina(R), StarKist(R), S&W(R), Nature's Goodness(TM), College Inn(R), 9Lives(R), Kibbles 'n Bits(R), Pup-Peroni(R), Snausages(R), Pounce(R) and Meaty Bone(R). DELPHI CORP: NuTech Wants Trial to Proceed by February ------------------------------------------------------ NuTech Plastics Engineering, Inc., sought to lift the automatic stay to continue a breach-of-contract case against Delphi Automotive Systems USA, LLC, and General Motors Corporation. On July 19, 2006, the Bankruptcy Court held a preliminary hearing on NuTech's request. At the conclusion of the hearing, Judge Drain asked the parties to "at least consider" an order that would allow NuTech to pursue its claims against GM in the Michigan trial court and allow the Michigan Trial Court to resolve NuTech's claims. The Bankruptcy Court continued the matter to a later hearing date. Delphi and NuTech met and conferred but disagreed about the Bankruptcy Court's comments. NuTech believed that the Court continued the preliminary hearing to allow the parties to consider cooperatively resolving the request, while Delphi believed that the Bankruptcy Court had denied the request and only continued the preliminary hearing to consider the need to depose a witness. The parties' disagreement was resolved, at least temporarily, by the submission to the Bankruptcy Court of a negotiated form of order continuing this matter to the September 14th omnibus hearing for a final order to the extent that the Court had not earlier resolved NuTech's request. The Order confirmed that a final determination on NuTech's request has not yet been made. NuTech presented the Order to the Michigan trial court in connection with a request to set NuTech's claims for trial. Delphi and GM, in their jointly filed answer to the Setting Request, pointed out that the claims against them should be tried together once the automatic stay terminates upon Delphi's emergence from Chapter 11. Delphi and GM believe that the facts are "interrelated" and the damages are "interrelated and inseparable." Delphi and GM emphasized that the Michigan trial court had previously determined and decided that the lawsuits should not be bifurcated. The Michigan trial court resolved NuTech's Setting Motion by indicating that the first clear trial date on its calendar was in April 2007, but nonetheless set a trial date against GM for Feb. 14, 2007, as a back up for a scheduled trial. Steven A. Klenda, Esq., at Tisdale & Associates LLC, on behalf of NuTech, points out that the Michigan trial court did not, as a practical matter, accept the Bankruptcy Court's approach. According to Mr. Klenda, the February 2007 trial date set by the Michigan trial court will allow Delphi more than ample breathing room from NuTech's claim. Delphi's Chapter 11 case will have been either concluded or nearing completion, as a February 2007 trial will occur during the Debtors' projected exit from Chapter 11, Mr. Klenda notes. Mr. Klenda argues that given Delphi's admission of the interrelatedness of NuTech's claims against it and GM and the benefits of a one-trial resolution to judicial efficiency, among other things, it makes sense to try these cases -? which have been pending for almost four years now -? together. Mr. Klenda maintains that the Bankruptcy Court should now take the opportunity to revisit the preliminary determination in this matter and rule as a final matter that trial may proceed in the Michigan state court against both General Motors and the Debtor in February or April 2007. About Delphi Corp. 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. 41; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: 12,400 UAW Employees to Voluntarily Retire ------------------------------------------------------- Delphi Corp. disclosed results of the Hourly Special Attrition Plan reached on March 22, 2006 and the Hourly Special Supplemental Attrition Plan reached on June 2, 2006 between the UAW, General Motors and Delphi. Approximately 12,400 Delphi employees, representing roughly 85% of the retirement-eligible UAW workforce, elected to retire by Jan. 1, 2007. Approximately 1,400 employees elected the buyout option. Nearly all of Delphi's U.S. hourly employees represented by the UAW were eligible for the buyout program, with approximately 14,600 of those employees eligible to participate in the retirement and pre-retirement program. Certain eligible U.S. hourly employees accepted a lump sum incentive of $35,000 to retire while other eligible employees under the program elected buyout packages ranging from $40,000 to $140,000. Under the proposed program, GM has agreed to assume the financial obligations related to the lump sum payments to be made to eligible Delphi U.S. hourly employees accepting normal or voluntary retirement incentives. Additionally, GM will fund certain post-retirement employee benefit obligations related to Delphi employees who transition to GM under the plan for purposes of retirement as well as half of employee buyout costs. About General Motors General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the world's largest automaker, has been the global industry sales leader since 1931. Founded in 1908, GM employs about 317,000 people around the world. It has manufacturing operations in 32 countries and its vehicles are sold in 200 countries. About Delphi Corp. 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. DELTA AIR: Court Approves IBM Outsourcing Pact ---------------------------------------------- Delta Air Lines, Inc., and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Southern District of New York to enter into a Master Agreement for Operations Support Services between Delta Air Lines, Inc., and International Business Machines Corporation. As reported Troubled Company Reporter on Aug. 31, 2006, Delta maintains a sophisticated network of computers that run a variety of applications, including customer reservations, company record- keeping, communications, flight management and maintenance tracking services, that are critical to its business, related Marshall S. Huebner, Esq., at Davis Polk & Wardwell, in New York. To run the applications, Delta owns and operates a multitude of computer equipment, including large mainframe systems and mid- range server systems. Delta, through its wholly owned subsidiary, Delta Technology, LLC, currently operates and maintains its own computer infrastructure. As part of its restructuring efforts, Delta solicited proposals from several reputable computer service providers to determine whether outsourcing the operation and maintenance of computer infrastructure to a third-party specialist would provide improved service at a reduced cost, while allowing Delta to focus its restructuring efforts on its core competency of providing air transportation services to the public, Mr. Huebner relates. After a lengthy evaluation process, Delta has decided to enter into the Agreement with IBM, pursuant to which IBM will be responsible for operating and maintaining Delta's mainframe and mid-range computer hardware. IBM has a long tradition of excellence in maintaining computer hardware systems for large corporations. By engaging IBM to assume responsibility for maintaining its mainframe and mid-range computers, Delta will benefit from IBM's expertise, Mr. Huebner avers. In addition, engaging IBM to maintain Delta's computers will lead to significant cost savings over Delta continuing to do the work in-house, Mr. Huebner contends. Delta believes that entering into the Agreement will further its efforts to reorganize and is in the best interests of the Debtors and their estates. Headquartered in Atlanta, Georgia, Delta Air Lines -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The Company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. 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. (Delta Air Lines Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELTA AIR: Can Walk Away from Aero Newark Sublease Agreement ------------------------------------------------------------ Delta Air Lines, Inc., and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Southern District of New York to reject the Sublease Agreement and the Consent to the Sublease, with Aero Newark, LLC, effective Sept. 1, 2006. As reported in the Troubled Company Reporter on Sept. 5, 2006, Delta Air Lines, Inc., is a party to: -- a Sub-Lease Agreement dated February 27, 1998, with Aero Newark, LLC, the successor-in-interest to Airis Newark, L.L.C.; and -- a related Consent to Sublease Agreement dated December 13, 2000, and effective as of February 27, 1998, with the Port Authority of New York and New Jersey, and Aero Newark. Delta subleases and has the right to use and occupy certain cargo operations space, office space, and a ground service equipment area as an air cargo handling facility, at the Newark International Airport. The Debtors determined that certain facilities at the Airport, including, without limitation, facilities used in Delta's cargo operations, are uneconomical for their current operations at the Airport and will therefore be vacated on September 1, 2006. Sharon Katz, Esq., at Davis Polk & Wardwell, in New York, related that Delta has made more economical arrangements for its cargo operations at the Airport. Delta intends to enter into a new sublease agreement with Aero Newark to occupy reduced facilities for Delta's unit load device repair shop on September 1, 2006. By rejecting the Agreements now, Delta will avoid incurring unnecessary administrative charges for leased premises that are not needed for its current operations at the Airport and that provide no tangible benefit to the Debtors' estates, Ms. Katz contended. Headquartered in Atlanta, Georgia, Delta Air Lines -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The Company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. 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. (Delta Air Lines Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DENNY'S CORP: Moody's Withdraws B2 Corp. Family Rating ------------------------------------------------------ Moody's Investors Service moved Denny's Corporation's corporate family rating to Denny's Holdings, Inc. due to the fact that Holdings is the highest ranking entity in the Denny's legal organizational chart that has rated debt, represented by Holdings' Caa1 rated $175 million senior unsecured notes due in 2012. In addition, Denny's Corporation, the ultimate parent company of the Denny's brand, does not have any rated debt. The 1st lien (B2) and 2nd lien (B3) credit facilities were issued at Denny's, Inc., the operating subsidiary. Therefore, the credit facility ratings were moved to Denny's, Inc. from Denny's Corporation. Ratings and stable outlook withdrawn: * Denny's Corporation - B2 corporate family rating. Rating assigned with stable outlook: * Denny's Holdings, Inc. - B2 corporate family rating. Denny's Corporation, a family-style restaurant chain headquartered in Spartanburg, South Carolina, owned and operated 543 and franchised 1,023 full-service family dining restaurants as of June 28, 2006. Domestic locations are scattered throughout 49 states and the District of Columbia with concentrations in California, Florida and Texas. Revenues for fiscal 2005 totaled $979 million. DIXIE GROUP: Moody's Assigns Loss-Given-Default Rating ------------------------------------------------------ In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B1 Corporate Family Rating for The Dixie Group, Inc. and its B3 rating on the Company's $22 million convertible subordinated debentures due 2012. Additionally, Moody's assigned an LGD6 rating to debentures, suggesting noteholders will experience a 90%% loss in the event of a default. Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Chattanooga, Tennessee, The Dixie Group Inc. (NASDAQ:DXYN) -- http://www.thedixiegroup.com/-- is a marketer and manufacturer of carpet and rugs to high-end residential customers through the Fabrica International, Masland Residential and Dixie Home brands. DOLE FOOD: Moody's Assigns Loss-Given-Default Ratings ----------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its Ba3 Corporate Family Rating for Dole Food Company, Inc. Additionally, Moody's revised or confirmed its probability-of- default ratings and assigned loss-given-default ratings on these loans facilities: Issuer: Dole Food Company, Inc. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Gtd. Sr. Sec. Term Loan B Due 2013 Ba3 Ba2 LGD2 20% Gtd. Sr. Sec. Letter of Credit Due 2013 Ba3 Ba2 LGD2 20% Gtd. Global Notes Due 2010 B3 B3 LGD5 77% Global Notes Due 2009 B3 B3 LGD5 77% Gtd. Global Bonds Due 2011 B3 B3 LGD5 77% Debentures Due 2013 B3 B3 LGD5 77% Issuer: Solvest Ltd. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Gtd. Sr. Sec. Term Loan C Due 2013 Ba3 Ba2 LGD2 20% Gtd. Sr. Sec. Letter of Credit Due 2013 Ba3 Ba2 LGD2 20% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Solvest, Ltd., is a wholly owned subsidiary of Dole Food Company, Inc. Westlake Village, Calif.-based Dole Food Company, Inc. -- http://www.dole.com/-- is the world's largest producer and marketer of high-quality fresh fruit, fresh vegetables, and fresh- cut flowers based on revenues. Dole markets a growing line of packaged and frozen foods and is a produce industry leader in nutrition education and research. EASY GARDENER: Judge Gross Approves Amended Disclosure Statement ---------------------------------------------------------------- The Honorable Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware has approved the First Amended Disclosure Statement explaining Easy Gardener Products, Ltd., and its debtor- affiliates' First Amended Joint Plan of Liquidation. Judge Gross determined that the Disclosure Statement contained adequate information -- the right amount of the right kind -- for creditors to make informed decisions when the Debtors ask them to vote to accept the Plan. The Debtor's Plan is premised upon a limited substantive consolidation of the Debtors' estates solely for purposes of actions associated with the confirmation and consummation of the Plan. Under the Plan, the Debtors will be deemed substantively consolidated for distribution purposes as of the Confirmation Date, and all Intercompany Claims will be eliminated. The Plan does not contemplate the merger or dissolution of any of the Debtors or the transfer or commingling of assets of the Debtors, except to accomplish the distributions to creditors contemplated under the Plan. Treatment of Claims All Allowed Administrative Claims will be paid in full on the later of the effective date, the date the claim becomes an allowed administrative claim, or as soon as practical. All Allowed Priority Tax Claims will be paid in full on the effective date, except those claims that have been paid before the effective date. All Class 1 Allowed Other Priority Claims will be paid in full on the later of the effective date, the date the claim becomes an allowed other priority claim, or as soon as practical. All Class 2 Allowed Lenders' Claims will be paid from the proceeds of the asset sale, under the conditions stated in the Sale Order and the Final DIP Financing Order. Class 3 Allowed Other Secured Claims are impaired. Except if a creditor agrees to a different treatment, each holder of an Allowed Other Secured Claim will receive the collateral securing the claim, as is, where is. All costs associated with obtaining the collateral will be borne by the creditors. Any portion not satisfied by the return of the collateral will be treated as a general unsecured claim. Holders of Class 4 Allowed General Unsecured Claims will receive a pro rata share of 90% of the Net Available Funds within 30 days after the effective date. The remaining 10% will be retained by the Debtors until the Final Distribution. The Debtors expect general unsecured creditors to receive 20% to 25% of their claims. Class 5 Equity Interests will not receive anything under the Plan. A full-text, redlined, copy of the Debtors' First Amended Disclosure Statement is available for a fee at: http://www.researcharchives.com/bin/download?id=060926213653 Plan Confirmation The deadline for filing objections to the confirmation of the Debtor's Plan is November 8, and a plan-confirmation hearing is scheduled at 11:00 a.m., on Nov. 14, 2006. Objections to confirmatin of the Plan must be filed with the Clerk of the Bankruptcy Court and copies furnished to: Debtors' Counsel: Laura Davis Jones, Esq. Pachulski Stang Ziehl Young Jones & Weintraub LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington, DE 19899-8705 Fax: (302) 652-44000 John F. Higgins, Esq. James Matthew Vaughn, Esq. Porter & Hedges, LLP 1000 Main, 36th Floor Houston, TX 77002 Fax: (713) 226-6248 Counsel for the Creditors' Committee: Joel A. Waite, Esq. M. Blake Cleary, Esq. Young Conaway Stargatt & Taylor LLP The Brandywine Building 1000 West street, 17th floor Wilmington, DE 19801 Fax: (302) 576-3278 The U.S. Trustee: William K , Harrington Office of the U.S Trustee 844 King Street, Room 2207 Lockbox #35 Wilmington, DE 19899-0035 Fax: (302) 573-6497 Headquartered in Waco, Texas, Easy Gardener Products, Ltd. -- http://www.easygardener.com/-- manufactured and sold a broad range of consumer lawn and garden products, including weed preventative landscape fabrics, fertilizer spikes, decorative landscape edging, shade cloth and root feeders, which are sold under various recognized brand names including Easy Gardener, Weedblock, Jobe's, Emerald Edge, and Ross. The Company and four of its affiliates filed for bankruptcy on April 19, 2006 (Bankr. D. Del. Case Nos. 06-10393 to 06-10397). James E. O'Neill, Esq., Laura Davis Jones, Esq., and Sandra G.M. Selzer, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP and John F. Higgins, Esq., James Matthew Vaughn, Esq., and Joshua W. Wolfshohl, Esq., at Porter & Hedges, LLP, represent the Debtors. Adam Dunayer, Brett Lowrey, Michael Boone, and Ben Williams at Houlihan Lokey Howard & Zukin give financial advice to the Debtors. Joel A. Waite, Esq., and M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Official Committee of Unsecured Creditors. Samuel Star at FTI Consulting, Inc., gives financial advice to the Committee. When the Debtors filed for bankruptcy, they reported assets amounting to $103,454,000 and debts totaling $107,516,000. EASY GARDENER: Exclusive Solicitation Period Extended to Nov. 29 ---------------------------------------------------------------- The Honorable Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware extended, until Nov. 29, 2006, Easy Gardener Products, Ltd., and its debtor-affiliates' exclusive period to solicit acceptances of their Joint Plan of Liquidation. As reported in the Troubled Company Reporter on Sept. 11, 2006, The Debtors' filed their liquidating plan on Aug. 4, 2006. The Debtors subsequently filed an amended plan and accompanying disclosure statement on Sept. 19, 2006. Judge Gross has approved the adequacy of the Sept. 19 amended disclosure statement. Headquartered in Waco, Texas, Easy Gardener Products, Ltd. -- http://www.easygardener.com/-- manufactured and sold a broad range of consumer lawn and garden products, including weed preventative landscape fabrics, fertilizer spikes, decorative landscape edging, shade cloth and root feeders, which are sold under various recognized brand names including Easy Gardener, Weedblock, Jobe's, Emerald Edge, and Ross. The Company and four of its affiliates filed for bankruptcy on April 19, 2006 (Bankr. D. Del. Case Nos. 06-10393 to 06-10397). James E. O'Neill, Esq., Laura Davis Jones, Esq., and Sandra G.M. Selzer, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP and John F. Higgins, Esq., James Matthew Vaughn, Esq., and Joshua W. Wolfshohl, Esq., at Porter & Hedges, LLP, represent the Debtors. Adam Dunayer, Brett Lowrey, Michael Boone, and Ben Williams at Houlihan Lokey Howard & Zukin give financial advice to the Debtors. Joel A. Waite, Esq., and M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Official Committee of Unsecured Creditors. Samuel Star at FTI Consulting, Inc., gives financial advice to the Committee. When the Debtors filed for bankruptcy, they reported assets amounting to $103,454,000 and debts totaling $107,516,000. FAREPORT CAPITAL: Inks Pact with Investor to Acquire 60% of Shares ------------------------------------------------------------------ Fareport Capital, Inc., disclosed that it proposes to restructure its affairs, settle outstanding litigation, and complete a conversion of all of its current debt obligations. The Company proposes to enter into a financing transaction with an investor, whereby the Investor will make a CDN$2.8 million commitment to acquire certain existing debt and new common shares of the Company. Specifically, the Investor will first advance to the Company CDN$200,000 by way of an unsecured subordinated loan bearing interest at 12% per annum, evidenced by a convertible promissory note, to be used as working capital. Next, the Investor will acquire from current holders certain pre-existing debentures, promissory notes and other indebtedness of the Company having a face value, including principal and interest, of approximately CDN$3,076,083. The Company then proposes to complete a 100 to 1 share consolidation, following which the Prior Loans will be converted into common shares of the Company. The Investor will then purchase approximately CDN$1,130,838 worth of common shares of the Company issued from treasury. The Company anticipates that it will be instructed by the Investor to register the shares issuable upon the conversion of the Prior Loans in the names of certain shareholders of the Investor. Finally, the Company proposes to create and issue to the Investor CDN$100,000 worth of first convertible preferred shares such that the Investor will, after the preferred shares are converted into common shares, own 60% of the issued and outstanding common shares of the Company. As a result of the transactions, the Investor would become the controlling shareholder of the Company. The terms of the transaction have been set out in a binding commitment letter and term sheet, which, the Company anticipates, will be superceded by definitive detailed documentation. Pursuant to the Commitment Letter, the Company will seek the agreement of the creditors under the Prior Loans to settle, in full and final satisfaction, the Prior Loans in exchange for the sale of the Prior Loans to the Investor for cash. The settlement is also expected to include a settlement of all outstanding litigation involving the Company. The "Conversion Price" will be CDN$2.50 on a post-consolidation basis. The Company also disclosed that in order to complete the transactions, the outstanding litigation must be settled and prior shareholder approval of: (a) the consolidation of the Company's common shares on a 100 "old" common shares for 1 "new" common share basis; (b) the terms of conversion of the Prior Debt; (c) the issuance of Common Shares from treasury; and (d) the creation of a new class of preferred shares of the Company must be obtained. Prior TSX Venture Exchange approval is also required to complete the transactions. The Company also commits to hold a special meeting of its shareholders to approve the matters within 75 days of the Advance closing. The transactions are also subject to the Investor being satisfied with its due diligence investigations of the Company, acting reasonably, such condition to be satisfied or waived by the Investor by Oct. 23, 2006. Update on OSC Policy Compliance The Company further disclosed that it is up-to-date with respect to its financial statements and management reporting, in compliance with the Ontario Securities Commission Policy 57-603. The temporary management and insider cease trade order imposed pursuant to OSC Policy 57-603, which prohibits present and certain past directors, officers and insiders of the Company from trading in securities of the Company, continues to be in effect. Fareport Capital operates the Crown Taxi and Olympic Taxi brokerages and dispatch operations in the city of Toronto. The Crown Taxi division dispatches to over 300 vehicles. In addition, through its Crown Transportation and Trax Shuttle Services divisions, the Company also offers charter transportation services. * * * Fareport Capital Inc.'s balance sheet at April 30, 2006 showed total assets of CDN$1.7 million and total liabilities of CDN$3.8 million, resulting in a shareholders' deficit of CDN$2.1 million. Shareholders' deficit at July 31, 2005 stood at CDN$1.5 million. FEDERAL-M0GUL: Court Extends Lease Decision Period to Dec. 1 ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware approved Federal-Mogul Corp. and its debtor-affiliates' request to further extend the time within which they may elect to assume or reject unexpired nonresidential real property leases and executory contracts, through and including Dec. 1, 2006. As reported in the Troubled Company Reporter on July 28, 2006, while the Debtors have largely completed the process of evaluating their unexpired nonresidential real property leases and a number of economically and improvident leases have been rejected with the Court's approval, several leases are continuing to be evaluated, Scotta E. McFarland, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP, in Wilmington, Delaware, relates. According to Ms. McFarland, the process of evaluating and rejecting the Real Property Leases has taken place as the Debtors, consistent with their overall business plan, seek to: -- consolidate their facilities to eliminate redundancies and inefficiencies; and -- shift certain manufacturing efforts to portions of the country and the world more suitable to their businesses. The four-month extension should be granted so the Debtors may preserve maximum flexibility in restructuring their business, Ms. McFarland maintains. Without the extension, the Debtors are concerned that they could be forced prematurely to assume the leases that would later be burdensome, giving rise to large potential administrative claims against their estates and hampering their ability to reorganize successfully. Alternatively, Ms. McFarland adds, the Debtors could be forced prematurely to reject Real Property Leases that would have been of benefit to their estates, to the collective detriment of all stakeholders. Ms. McFarland assures the Court that the Debtors, pending their election to assume or reject the Real Property Leases, will perform all their obligations, arising from and after the Date of filing for chapter 11 protection, in a timely fashion. 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. 113; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FIRST UNION: Moody's Puts Low-B Ratings on Four Cert. Classes ------------------------------------------------------------- Moody's Investors Service upgraded the ratings of eight classes and affirmed the ratings of ten classes of First Union National Bank Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2001-C4 -- Class A-1, $137,606,145, Fixed, affirmed at Aaa -- Class A-2, $469,800,000, Fixed, affirmed at Aaa -- Class IO-I, Notional, affirmed at Aaa -- Class IO-II, Notional, affirmed at Aaa -- Class B, $36,696,000, Fixed, affirmed at Aaa -- Class C, $12,232,000, Fixed, affirmed at Aaa -- Class D, $12,232,000, Fixed, upgraded to Aaa from Aa1 -- Class E, $17,125,000, Fixed, upgraded to Aaa from Aa3 -- Class F, $12,232,000, Fixed, upgraded to Aa1 from A1 -- Class G, $12,232,000, Fixed, upgraded to Aa2 from A2 -- Class H, $17,125,000, Fixed, upgraded to A1 from Baa1 -- Class J, $14,678,000, WAC, upgraded to A3 from Baa2 -- Class K, $14,679,000, Fixed, upgraded to Baa2 from Baa3 -- Class L, $22,017,000, Fixed, upgraded to Ba1 from Ba2 -- Class M, $7,339,000, Fixed, affirmed at Ba3 -- Class N, $7,029,000, Fixed, affirmed at B1 -- Class O, $6,938,000, Fixed, affirmed at B2 -- Class P, $4,626,000, Fixed, affirmed at B3 As of the Sept. 14, 2006, distribution date, the transaction's aggregate certificate balance has decreased by approximately 15.3% to $828.7 million from $978.6 million at securitization. The Certificates are collateralized by 123 mortgage loans ranging in size from less than 1.0% to 4.1% of the pool with the top ten loans representing 30.3% of the pool. The pool includes one shadow rated loan (3.7%) and the remainder of the pool is comprised of conduit loans. Fifteen loans, representing 13.7% of the pool, have defeased and have been replaced with U.S. Government securities. Eight loans have been liquidated from the trust resulting in realized losses of approximately $1.3 million. One loan, representing 1.1% of the pool, is in special servicing. Moody's anticipates a minimal loss from this loan. Twenty-six loans, representing 19.9% of the pool, are on the master servicer's watchlist. Moody's was provided with partial or full year 2005 operating results for 88.3% of the performing loans. Moody's loan to value ratio for the conduit component is 82.9%, compared to 89.9% at Moody's last full review in June 2005 and compared to 90.4% at securitization. Moody's is upgrading Classes D, E, F, G, H, J, K and L due to increased subordination levels, improved overall pool performance and defeasance. The shadow rated loan is the General Motors Building Loan ($30.9 million - 3.7%), which is secured by a leasehold interest in two Class A office buildings totaling 618,000 square feet. The buildings are part of the Renaissance Center in downtown Detroit, Michigan and are 100.0% master leased to General Motors Corporation (Moody's senior unsecured rating Caa1, compared to Baa3 at last review in April 2005). GM's 20-year lease expires in October 2021. The loan matures in November 2009 and is fully amortizing. The loan has amortized by approximately 42.2% to date. Even though the loan is fully amortizing, Moody's is concerned about potential volatility given the deterioration in GM's financial condition and the weakened Detroit office market. As of the fourth quarter of 2005, the office vacancy rate in downtown Detroit was 19.4%. Market rents have declined by 33.1% since securitization. Moody's current shadow rating is Ba2, compared to Baa1 at last review. The top three conduit exposures represent 12.0% of the outstanding pool balance. The largest exposure is the Cornerstone Portfolio ($34.2 million - 4.1%), which consists of three cross collateralized loans secured by three garden-style multifamily properties totaling 735 units. The properties are located in Virginia (2) and North Carolina. The portfolio is 95.0% occupied, compared to 96.2% at last review. Moody's LTV is 75.2%, compared to 78.0% at last review. The second largest conduit loan is the Overlook at Great Notch Loan ($33.2 million - 4.0%), which is secured by a 415,000 square foot Class A office building located in Little Falls (Passaic County), New Jersey. Performance has been impacted by a drop in occupancy due to lease rollover and increased expenses. The property is 77.0% occupied, essentially the same as at last review, and compared to 92.0% at securitization. Major tenants include PricewaterhouseCoopers (35.0% NRA; lease expiration October 2008) and Kline & Company (7.6% NRA; lease expiration October 2010). Moody's LTV is 97.0%, compared to 84.4%, at last review. The third largest conduit loan is the Orland Park Place Loan ($32.4 million - 3.9%), which is secured by a 421,000 square foot power center located approximately 20 miles southwest of Chicago in Orland, Illinois. The center is 99.0% occupied, compared to 94.0% at last review. Major tenants include Bed, Bath & Beyond (13.0% GLA; lease expiration January 2015), Sportsmart (11.0% GLA; lease expiration January 2015) and Steinmart (9.0% GLA; lease expiration May 2010). Moody's LTV is 90.8%, compared to 98.0% at last review. The pool's collateral is a mix of multifamily (32.9%), retail (24.9%), office and mixed use (22.7%), U.S. Government securities (13.7%) and industrial and self storage (5.8%). The collateral properties are located in 27 states plus Washington, D.C. The highest state concentrations are California (18.3%), Virginia (10.9%), Nevada (8.2%), New Jersey (7.7%) and Illinois (7.5%). All of the loans are fixed rate. FLYI INC: Various Parties Object to Solicitation Procedures ----------------------------------------------------------- FLYi, Inc., and debtor-affiliates asked the U.S. Bankruptcy Court for the District of Delaware to establish uniform procedures for the solicitation and tabulation of votes to accept or reject the Joint Plan of Liquidation filed by the Debtors, the Troubled Company Reporter reported on Aug. 25, 2006. Responses 1. Manufacturers & Traders Trust Prior to filing for bankruptcy, the Debtors financed the acquisition or lease of airframes, aircraft engines, and related parts through the issuance of $111,586,000 in pass through certificates -- the EETC Transaction. Manufacturers and Traders Trust Company, successor by merger to Allfirst Bank, formerly known as The First National Bank of Maryland, is the Pass Through Trustee, Indenture Trustee and Subordination Agent on behalf of holders of the 1997-1 Pass Through Certificates issued by the Debtors. Bonnie Glantz Fatell, Esq., at Blank Rome LLP, in Wilmington, Delaware, asserts that the Solicitation Procedures should specifically provide that EETC Transaction certificate holders will receive Solicitation Packages. In addition, the order approving the Solicitation Procedures should include a finding as to the proper parties to be solicited and to vote with respect to the EETC Transaction. M&T asks the Court to direct the Debtors to supplement the Solicitation Motion with provisions that will enable pertinent parties to comply with the EETC Transaction's operative documents. 2. U.S. Bank & QVT Financial U.S. Bank National Association and QVT Financial LP assert that the Debtors' Solicitation Motion reflects a flawed and improper classification of claims and does not adequately discuss why aircraft lease rejection claims, unsecured aircraft finance claims and other aircraft-related claims will be allowed for voting purposes. U.S. Bank, as Indenture Trustee under a February 25, 2004 Indenture for the 6% Convertible Notes due 2034, and QVT, as holder of approximately 60% of the Notes, hold claims which constitute a significant portion of the undisputed claims against the FLYi, Inc., estate. Francis A. Monaco, Jr., at Monzack & Monaco, in Wilmington, Delaware, asserts that the Debtors' proposal to lump the Disputed Aircraft Claims together with other unsecured creditors in both the FLYi and Independence Air, Inc., unsecured classes will allow the Disputed Aircraft Claim holders to dominate the entire vote on the Joint Plan of Liquidation. As a result, Mr. Monaco points out, U.S. Bank's and QVT's votes will be overwhelmed, diluted and disenfranchised by the Disputed Aircraft Claims. In addition, the separate classification of the $285,000,000 Intercompany Claim against Independence, and its holder's presumed acceptance of the Plan, which allocates zero value to it, is in violation of Section 1126(g) of the Bankruptcy Code, Mr. Monaco contends. A class receiving no distribution under a Chapter 11 plan is presumed to reject the plan. The Intercompany Claim should rank pari passu with Independence's unsecured creditors in a non-consolidated scenario, and should be voted by an independent representative of parent-only creditors, Mr. Monaco avers. U.S. Bank and QVT relate that they may seek to conduct discovery in connection with any Plan confirmation objections. Both parties thus ask the Court not to set a confirmation hearing date at the moment or otherwise allow them sufficient time for discovery to occur. Claims Reduction Objections Five creditors assert that they should be allowed to vote their claims in full: (1) C.I.T. Leasing Corporation, (2) Export Development Canada, (3) IAE International Aero Engines AG, (4) ING Lease (Ireland) B.V., and (5) International Lease Finance Corporation. The Creditors are parties to separate contracts and leases with the Debtors, pursuant to which they filed several proofs of claim. The Creditors note that the Debtors proposed to: -- reduce most of their Claims to $1 for purposes of voting on the Joint Plan of Liquidation; -- require them to file motions under Rule 3018 of the Federal Rules of Bankruptcy Procedure to re-establish, for voting purposes, the Claim Amounts; and -- instate that Rule 3018 motions will heard at the Plan Confirmation hearing. The Debtors have not filed objections to the Claims in accordance with Section 502(b) of the Bankruptcy Code and Rule 3007 of the Federal Rules of Bankruptcy Procedure, the Creditors point out. Moreover, the Debtors have not provided any reasons why the Claim Amounts should be limited for voting or any other purposes. The Claims are prima facie evidence of their validity and amounts, the Creditors contend. Thus, unless and until the Debtors file a proper objection to the Claims, they should be deemed allowed in the amounts filed. The Creditors remind the Court that pursuant to Bankruptcy Rule 3018(a), the temporary allowance of a claim is only necessary or appropriate once a proper objection to the claim has been filed. Furthermore, the Creditors argue that they should be permitted to seek a hearing on Rule 3018 motions prior to the Plan Confirmation hearing. Accordingly, the Creditors ask the Court to temporarily allow their Claims in the amounts filed, for voting and every other purpose under the Bankruptcy Code and the Bankruptcy Rules. Vote Counting Objections Four creditors oppose the Solicitation Motion to the extent that it seeks to establish that votes cast in favor of the Debtors' Joint Plan of Liquidation may be used to confirm the Plan even if the Court changes the terms of the Intercompany Resolution between the estates of FLYi, Inc., and Independence Air, Inc.: (1) C.I.T. Leasing Corporation, (2) International Lease Finance Corporation, (3) QVT Financial LP, and (4) U.S. Bank National Association. The Debtors' proposed counting of votes is in violation of Rule 3019(a) of the Federal Rules of Bankruptcy Procedure, the Creditors assert. The United Airlines, Inc., Claims Settlement Proceeds, which total approximately $100,000,000, comprise the largest of the Debtors' assets, the Creditors point out. Thus, allocation of the UAL Proceeds will have a major impact on creditors' recoveries. The determination of whether the reallocation of the UAL Proceeds is a material modification of the Plan requiring re- solicitation should be made at the time the reallocation is made, the Creditors argue. Because it is not yet clear how the Intercompany Claim and related issues will be settled, it is improper to have creditors gamble away their votes before their treatment is more fully and appropriately addressed, the Creditors contend. How the Intercompany Claim and the related issues will be settled should be a matter for the creditor constituencies whose economic rights and recoveries are at stake to resolve. "Though the Plan is not before the Court at this time, the Solicitation Motion, if granted, might predetermine issues that should be properly decided at the Confirmation hearing," the Creditors assert. The Creditors thus ask the Court to deny the Solicitation Motion. 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. 25; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FLYI INC: Contracts and Leases Rejection is Effective Aug. 31 ------------------------------------------------------------- The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware rules that the rejection of the Contracts and Leases with Manufacturers and Traders Trust Company and its affiliates, predecessors and successors will be effective as of Aug. 31, 2006. As reported in the Troubled Company Reporter on Sept. 11, 2006, FLYi, Inc., and its debtor-affiliates asked the Court for authority to reject approximately 2,500 executory contracts and unexpired leases, to the extent executory or unexpired. The Contracts are unnecessary to the Debtors' estates, M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, contended. In addition, the Contracts have no market value and are thus an undue burden to the Debtors' estates. Mr. Cleary related that the non-Debtor parties to the Contracts have reason to expect that their contracts or leases would be rejected given the Debtors' public announcement and numerous press reports on the discontinuation of their scheduled flight operations. A 46-page list of the Contracts and Leases to be rejected is available for free at http://ResearchArchives.com/t/s?1152 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. 25; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FOAMEX INTERNATIONAL: Asks Court to Disallow Eleven Amended Claims ------------------------------------------------------------------ Foamex International Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to disallow and expunge in their entirety: -- 11 claims that have been amended and superseded by subsequent proofs of claim; -- Claim No. 166, a duplicate claim; and -- Claim No. 1314, a late-filed claim. According to Kenneth J. Enos, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, the Amended and Superseded Claims no longer represent valid claims against the Debtors. The Amended and Superseded Claims are: Remaining Amended Claim Claim Claimant Claim No. To Be Expunged Amount -------- --------- -------------- ------ Atmos Energy 1321 11 $16,067 Automotive Rentals, Inc. 1185 799 1,181 Dallas County Linebarger Goggan Blair, et al. 1292 338 unliquidated Dept. of Treasury IRS 1178 340 581,963 Health Resources 1316 675 92,902 IBM Credit LLC 1214 612 3,559 Longacre Master Fund Ltd. 1293 1261 283,946 Longacre Master Fund Ltd. 1298 45 254,592 New Jersey Tax Division 1118 49 2,200 New Mexico Environment Dept. 1266 1238 - Penske Truck Leasing 324 5 311,193 PG Energy's Claim No. 166 was identified by the Debtors to be a duplicate of Claim No. 1319. The Claim, which asserts $82, was filed with both the Clerk of the Bankruptcy Court and Bankruptcy Services LLC, the Court-approved claims agent. The Debtors believe that it was not the intention of PG Energy to seek double recovery. Regardless of PG Energy's reason for filing duplicate claims, however, only Claim No. 1319 should be allowed, Mr. Enos maintains. Marshall Cogan filed Claim No. 1314 for $1,908,056 on August 3, 2006. The Debtors object to the claim because it was filed beyond the December 8, 2005 bar date for filing claims. Mr. Enos says that failure to disallow the late-filed claim would result in Mr. Cogan receiving an unwarranted recovery against the Debtors' estates to the detriment of other similarly situated creditors. The Debtors reserve their right to object to any of the claims on other grounds. Objections to the Debtors' request are due Oct. 12, 2006. Headquartered in Linwood, Pa., Foamex International Inc. -- http://www.foamex.com/-- is the world's leading producer of comfort cushioning for bedding, furniture, carpet cushion and automotive markets. The Company also manufactures high- performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. The Company and eight affiliates filed for chapter 11 protection on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, represent the Debtors in their restructuring efforts. Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen, Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the Official Committee of Unsecured Creditors. As of July 3, 2005, the Debtors reported $620,826,000 in total assets and $744,757,000 in total debts. (Foamex International Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FOAMEX INTERNATIONAL: Gets Okay to Assume Amended EDS Contract -------------------------------------------------------------- The Hon. Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware authorizes Foamex International Inc. and its debtor-affiliates to assume their amended contract with Electronic Data Systems Corp. and EDS Information Services LLC, effective Sept. 21, 2006. Judge Walsh directs the Debtors to cure the defaults under the Original EDS Contract by paying $1,195,382 to the EDS Companies no later than Sept. 30, 2006. Judge Walsh also rules that the EDS Companies' unsecured prepetition claim for $1,634,187 against the Debtors will be deemed withdrawn upon the later of: (i) Sept. 21, 2006; (ii) payment to the EDS Companies of the cure amount; and (iii) execution by the parties of the EDS Contract Amendment. As reported in the Troubled Company Reporter on Sept. 8, 2006, the EDS Companies provided the Debtors information technology services that impact all facets of their businesses pursuant to the original contract dated June 15, 2002. The assumption of the amended EDS Contract provides the Debtors with material benefits. Headquartered in Linwood, Pa., Foamex International Inc. -- http://www.foamex.com/-- is the world's leading producer of comfort cushioning for bedding, furniture, carpet cushion and automotive markets. The Company also manufactures high- performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. The Company and eight affiliates filed for chapter 11 protection on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, represent the Debtors in their restructuring efforts. Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen, Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the Official Committee of Unsecured Creditors. As of July 3, 2005, the Debtors reported $620,826,000 in total assets and $744,757,000 in total debts. (Foamex International Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FUTRONIX INC: Sibex Buys Bankrupt Assets for $1.38 Million ---------------------------------------------------------- Sibex Inc. purchased bankrupt Futronix Inc. and all its assets last week for $1.38 million, Eddy Ramirez writes for the St. Petersburg Times. The deal came less than three years after Futronix disclosed major expansion plans that included building a world-class electronics manufacturing facility, Mr. Ramirez relates. According to Sibex president Michael McCarthy Thursday, he will continue to employ Futronix's 30 workers as part of the deal. Although it will keep its headquarters in Safety Harbor, Sibex says it will not assume Futronix's liabilities but would continue doing business with Futronix clients. "We have a lot of business that we will move to the (Homosassa) plant," Mr. McCarthy told the paper. "We're trying to continue with any customers that were there." Sibex approached Futronix in February regarding the sale as part of its growth strategy. The Times explains that the company has been scouting additional manufacturing plants since outgrowing its 3,300-square-foot-building in Safety Harbor. Headquartered in Safety Harbor, Florida, Sibex Inc. manufactures electronic machinery prototypes and computer boards. Headquartered in Homosassa, Florida, Futronix Inc. -- http://www.futronixinc.com/-- manufactures consigned & turnkey production, helps with circuit design, assembly, fabrication and produces Printed Circuit Boards. The Co. and its affiliate, Futronix Group Inc., filed chapter 11 petitions on April 5, 2005, at the U.S. Bankruptcy Court for the Middle District of Florida (Bankr. M.D. Fla. Case No. 05-06329). Alberto F. Gomez, Jr., Esq., at Morse & Gomez, PA, represented the Debtors in their bankruptcy proceedings. When they filed for protection from their creditors, the Debtors estimated between $1 million and $10 million in total assets and debts. GB HOLDINGS: Creditors' Panel Submits Fourth Modified Ch. 11 Plan ----------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in GB Holdings, Inc.'s Chapter 11 case filed a Fourth Modified Chapter 11 Plan and related Disclosure Statement on Sept. 21, 2006. The Committee's Plan hinges either on its successful attempt to compel the payment of dividends due on Atlantic Coast Entertainment Holdings, Inc., common stock owned by the Debtor or the sale of these common stock holdings to the highest bidder at an auction. The Debtor has no operating activities and no income and its principal tangible asset consist of 2,882,938 shares of common stock, representing approximately 41.7% of the equity interests in Atlantic. Atlantic owns and operates The Sands Hotel & Casino in Atlantic City, New Jersey. The Committee believes that general unsecured creditors will recover 100% of their claims if it's lawsuit to compel payment of the dividend is successful. The Atlantic stock will be sold to the highest bidder if the Committee's dividend payment suit fails. If the stock is sold before the effective date of the plan, the net proceeds of the sale will be used to fund a Liquidating Trust Reserve, in an amount not to exceed $4 million, with the remaining amount to be paid pro-rata to holders of Allowed "American Real Estate Holdings Limited Partnership" AREH Claims and Allowed General Unsecured Claims. If the Atlantic stock is not sold before the effective date, the stock will be transferred to the Liquidating Trust and the Liquidating Trust will obtain an Exit Facility to administer the Liquidating Trust Assets, which would include the sale of the Atlantic stock and prosecution of causes of action. In the event the dividend payment suit and the stock sale is unsuccessful, the Liquidating Trust will have an Exit Facility in the principal amount of up to $6,000,000 to fund the costs of maintaining the Liquidating Trust and the Liquidating Trust Assets, including the prosecution of the Causes of Action and any marketing of the Atlantic stock. Treatment of Claims Pursuant to the Committee's liquidating plan, holders of Allowed Administrative Claims, Priority Tax Claims, Other Priority Claims and Secured Claims will be paid in full in cash or have their secured interests reinstated. The holder of an Allowed AREH Secured Claim will receive the Restructured Note in full satisfaction, settlement and release of the AREH Secured Claim. However, if the dividend payment suit is successful or a sale of the Atlantic stock is consummated, the holder of an Allowed AREH Secured Claim will be paid in full and in cash. Holders of Allowed General Unsecured Claims will receive pro rata Cash Distributions from either the dividend claim or the stock sale and will receive pro rata beneficial interests in the Liquidating Trust. Holders of Allowed Equity Interests will receive pro rata distributions, if any, from the residual proceeds of the dividend claim or the stock sale. A copy of the Committee's Fourth Modified Chapter 11 Plan is available for a fee at: http://www.researcharchives.com/bin/download?id=060926214233 About GB Holdings Headquartered in Atlantic City, New Jersey, GB Holdings, Inc., primarily generates revenues from gaming operations in Atlantic Coast Entertainment Holdings, which owns and operates The Sands Hotel and Casino in Atlantic City, New Jersey. The Debtor also provides rooms, entertainment, retail store and food and beverage operations. These operations generate nominal revenues in comparison to the casino operations. The Debtor filed for chapter 11 protection on September 29, 2005 (Bankr. D. N.J. Case No. 05-42736). Alan I. Moldoff, Esq., at Adelman Lavine Gold and Levin, represents the Debtor. Charles A. Stanziale, Jr., Esq., at McElroy, Deutsch, Mulvaney & Carpenter, serves as counsel to the Official Committee Of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million to $50 million. GENERAL MOTORS: To Fund Post-Retirement Benefits of Delphi Workers ------------------------------------------------------------------ Delphi Corp. disclosed results of the Hourly Special Attrition Plan reached on March 22, 2006 and the Hourly Special Supplemental Attrition Plan reached on June 2, 2006 between the UAW, General Motors and Delphi. Approximately 12,400 Delphi employees, representing roughly 85% of the retirement-eligible UAW workforce, elected to retire by Jan. 1, 2007. Approximately 1,400 employees elected the buyout option. Nearly all of Delphi's U.S. hourly employees represented by the UAW were eligible for the buyout program, with approximately 14,600 of those employees eligible to participate in the retirement and pre-retirement program. Certain eligible U.S. hourly employees accepted a lump sum incentive of $35,000 to retire while other eligible employees under the program elected buyout packages ranging from $40,000 to $140,000. Under the proposed program, GM has agreed to assume the financial obligations related to the lump sum payments to be made to eligible Delphi U.S. hourly employees accepting normal or voluntary retirement incentives. Additionally, GM will fund certain post-retirement employee benefit obligations related to Delphi employees who transition to GM under the plan for purposes of retirement as well as half of employee buyout costs. About Delphi Corp. 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. About General Motors General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the world's largest automaker, has been the global industry sales leader since 1931. Founded in 1908, GM employs about 317,000 people around the world. It has manufacturing operations in 32 countries and its vehicles are sold in 200 countries. * * * As reported in the Troubled Company Reporter on July 28, 2006, Standard & Poor's Ratings Services held all of its ratings on General Motors Corp. -- including the 'B' corporate credit rating, but excluding the '1' recovery rating -- on CreditWatch with negative implications, where they were placed March 29, 2006. The CreditWatch update followed GM's announcement of second quarter results and other recent developments involving its bank facility and progress on the GMAC sale. As reported in the Troubled Company Reporter on July 27, 2006, Dominion Bond Rating Service downgraded the long-term debt ratings of General Motors Corporation and General Motors of Canada Limited to B. The commercial paper ratings of both companies are also downgraded to R-3 (low) from R-3. As reported in the Troubled Company Reporter on June 22, 2006, Fitch assigned a rating of 'BB' and a Recovery Rating of 'RR1' to General Motor's new $4.48 billion senior secured bank facility. The 'RR1' is based on the collateral package and other protections that are expected to provide full recovery in the event of a bankruptcy filing. GMAC COMMERCIAL: S&P Raises Class K Certificates' Rating to BB+ --------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on nine classes of commercial mortgage pass-through certificates from GMAC Commercial Mortgage Securities Inc.'s series 2003-C1. Concurrently, ratings were affirmed on 11 other classes from the same series. The raised and affirmed ratings reflect credit enhancement levels that provide adequate support through various stress scenarios. The raised ratings on several of the senior certificates reflect the defeasance of $156.5 million (16%) in collateral since issuance. As of the Sept. 11, 2006, remittance report, the collateral pool consisted of 103 loans with an aggregate trust balance of $1.00 billion, down from $1.05 billion with the same number of loans at issuance. The master servicer, Capmark Finance Inc., reported primarily full-year 2005 financial information for 98% of the pool. Based on this information, Standard & Poor's calculated the weighted average debt service coverage to be 1.62x, up from 1.54x at issuance. The current DSC excludes $156.5 million (16%) in loans for defeased collateral. All of the loans in the pool are current. To date, the trust has not experienced any losses. The top 10 loans have an aggregate outstanding balance of $385.9 million (38%) and a weighted average DSC of 1.63x, compared with 1.72x at issuance. The reduced DSC for the top 10 loans occurred because two of the loans have reported significant declines in DSC. These two loans are on the watchlist and are discussed below. Standard & Poor's reviewed property inspections provided by the master servicer for all of the assets underlying the top 10 loans. Two properties were characterized as "excellent," while the remaining collateral was characterized as "good." At issuance, the largest and third-largest exposures in the pool displayed credit characteristics consistent with high-investment- grade obligations in the context of their inclusion in the pool. The largest exposure in the pool, the Oakbrook Center, is a pari passu loan with a whole-loan balance of $226.0 million and an in- trust balance of $56.4 million (6%). The loan is secured by 1.2 million sq. ft. of a 2.0 million-sq.-ft. super-regional mall in Oak Brook, Illinois, as well as by 240,223 sq. ft. of office space, a hotel, and an outparcel building that is 100% occupied by The Cheesecake Factory. Standard & Poor's adjusted net cash flow is 15% above the level at issuance, and the loan continues to exhibit credit characteristics consistent with a high-investment-grade obligation. The third-largest exposure, the Chandler Fashion Center, is a pari passu loan with a whole-loan balance of $177.0 million and an in- trust balance of $53.5 million (5%). The loan is secured by 630,570 sq. ft. of a 1.3-million-sq.-ft. super-regional mall in Chandler, Arizona. The collateral consists of 564,646 sq. ft. of inline retail space and an 85,625-sq.-ft. Harkins Movie Theater with 20 screens. Standard & Poor's adjusted NCF is 7% above the level at issuance, and the loan continues to exhibit credit characteristics consistent with a high-investment-grade obligation. Capmark reported a watchlist of 12 loans ($137.1 million, 14%). The Renaissance at Columbia Center loan is the fifth-largest exposure ($37.9 million 4%) and is secured by a 624,904-sq.-ft. office property in Columbia, Maryland. This loan appears on the watchlist because the property's DSC for first-quarter 2006 was 0.88x. The low DSC was caused by a loss of rental income due to the lease expiration of a large tenant. The lease for this tenant has since been renewed, and Standard & Poor's expects DSC to improve. The Norwest Woods loan is the seventh-largest exposure ($31.9 million 3%) and is secured by a 322-unit multifamily property in Norwood, Massachusetts. The loan appears on the watchlist because the property reported year-end 2005 DSC of 0.90x. The decline in DSC can be attributed to a fire that damaged 20 units, 13 of which have been renovated and either rented or are on the market for rent. The remaining units were demolished and are being rebuilt. The Village Park Apartments loan is the eighth-largest exposure ($24.0 million 2%) and is secured by a 544-unit multifamily property in Troy, Michigan. The collateral property has performed poorly because the borrower is offering rent concessions, and the loan appears on the watchlist because it reported 2005 DSC of 0.69x. Standard & Poor's stressed the loans on the watchlist and other loans with credit issues as part of its analysis. The resultant credit enhancement levels support the raised and affirmed ratings. Ratings Raised: GMAC Commercial Mortgage Securities Inc. Commercial mortgage pass-through certificates series 2003-C1 Class To From Credit enhancement ----- -- ---- ------------------ B AAA AA 15.97% C AA+ AA- 14.79% D AA A 12.57% E AA- A- 11.00% F A+ BBB+ 9.82% G A BBB 8.64% H A- BBB- 7.46% J BBB- BB+ 5.24% K BB+ BB 4.19% Ratings Affirmed: GMAC Commercial Mortgage Securities Inc. Commercial mortgage pass-through certificates series 2003-C1 Class Rating Credit enhancement ----- ------ ------------------ A-1 AAA 19.90% A-1A AAA 19.90% A-2 AAA 19.90% L BB- 3.40% M B+ 2.88% N-1 B 2.24% N-2 B 2.09% O B- 1.83% P CCC 1.31% X-1 AAA N/A X2 AAA N/A N/A -- Not applicable. GRUPO TMM: Redeems $155,820,539 of Senior Secured Notes Due 2007 ---------------------------------------------------------------- Grupo TMM, S.A., disclosed the closing of a $200 million securitization facility with Deutsche Bank AG, London. Under the terms of the Transaction, the Company will make equal monthly payments of principal and interest of approximately $3.2 million from Oct. 2006 to Sept. 2010, a balloon payment of $40 million in Oct. 2010 and equal monthly payments of principal and interest of approximately $4.2 million from Oct. 2010 to the final maturity on Sept. 25, 2012. Using part of the proceeds, on Sept. 25, 2006, the Company redeemed the total outstanding principal amount of $155,820,539 million and accrued interest of its Senior Secured Notes due 2007. The remainder of the net proceeds from the Transaction will be used in the implementation of the Company's business plan including the purchase of vessels and other transportation assets. Deutsche Bank AG, London, acted as structuring agent of the facility, and provided the funding for the Transaction. The Bank of New York is the trustee for the certificates issued under the facility. Axis Capital Management acted as financial advisor to the Company. Javier Segovia, president, said, "We are pleased that the Company was successful in extending its debt maturity while at the same time adding financial flexibility to implement its business strategy going forward." Headquartered in Mexico City, Grupo TMM S.A. (NYSE: TMM) (MEXVALORIS: TMMA) -- http://www.grupotmm.com/-- is a Latin American multimodal transportation and logistics company. Through its branch offices and network of subsidiary companies, TMM provides a dynamic combination of ocean and land transportation services. * * * Standard & Poor's Ratings Services raised its corporate credit rating on Grupo TMM S.A. to 'B-' from 'CCC.' The rating was removed from Creditwatch, where it was placed on Dec. 15, 2004. S&P said the outlook is positive. GUESS? INC: Enters Into Joint Venture Pact with Mexican Company --------------------------------------------------------------- Guess?, Inc., has entered into a joint venture agreement for Mexico with an affiliate of Grupo Axo, a Mexican company that helps the development of internationally known brands, such as Coach, DKNY and Tommy Hilfiger, in Mexico. The joint venture, a majority of which is owned by Guess?, will engage in the manufacture, wholesale distribution and retail sale of Guess? fashion apparel, accessories and other related products in Mexico. The first Guess? retail store under the joint venture opened in May 2006 in Mexico City and the second one opened in Cancun in July 2006. Paul Marciano, Co-Chairman and Co-CEO of Guess?, Inc., commented, "The formation of our new Mexican joint venture is another step forward in our international expansion. The Guess? brand is already well recognized in Mexico as we had an apparel license in this region for over twenty years until 2004. We believe Mexico is an exciting opportunity for Guess?." Mr. Marciano added, "We have experienced incredible success with Guess? In Canada which also started out as a joint venture in 1994 and is now a wholly owned subsidiary of Guess? and one of our best performing regions. We hope to achieve similar success with our joint venture partners in Mexico." Andres Gomez, Co-CEO of Grupo Axo, stated, "During our first year of operations in Mexico, we plan to position Guess? as one of the top fashion brands as we look to further expand the presence of Guess? in Mexico." Alberto Fasja Cohen, Co-CEO of Grupo Axo, added, "Our growth strategy for Mexico over the next several years includes the opening of several free standing stores and over 50 shop-in-shops within leading department stores." About Grupo Axo Grupo Axo is a leader in the development of prestigious international brands and products in Mexico, with primary focus on the fashion and hospitality industries. At Aug. 31, 2006 Grupo Axo owned and operated 39 retail stores and over 300 shop-in-shops throughout Mexico. About Guess? Guess?, Inc., -- http://www.guess.com-- designs, markets, distributes and licenses a lifestyle collection of contemporary apparel, accessories and related consumer products. The company owns and operates retail stores in the United States, Canada and Mexico. The company also distributes its products through better department and specialty stores around the world. * * * As reported in the Troubled Company reporter on March 13, 2006, Standard & Poor's Ratings Services revised its rating outlook on Guess? Inc. to positive from stable. At the same time, Standard & Poor's affirmed the company's ratings, including its 'BB-' corporate credit rating. HENRY BRADFORD: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Henry Mancini Bradford Latoya Venita Bradford P.O. Box 188260 Sacramento, California 95818 Bankruptcy Case No.: 06-41568 Chapter 11 Petition Date: September 7, 2006 Court: Northern District of California (Oakland) Judge: Randall J. Newsome Debtors' Counsel: Marc Voisenat, Esq. Law Offices of Marc Voisenat 1330 Broadway #1035 Oakland, CA 94612 Tel: (510) 272-9710 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtors' 11 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Patelco Credit Union $30,000 P.O. Box 2227 Merced, CA 95344-0227 American Express $15,000 P.O. Box 000l Los Angeles, CA 90096-000l Pacific Service Credit Union $15,000 P.O. Box 8l9l Walnut Creek, CA 94596 Pacific Gas & Electric $1,700 P.O. Box 8329 Stockton, CA 95208 City of Sacramento $1,200 P.O. Box 2770 Sacramento, CA 958l2-2770 Brinks Home Security $1,200 P.O. Box 6604l8 Dallas, TX 75266-04l8 Alameda Dept. of Child Support Services $1,000 P.O. Box 2072 Oakland, CA 04604-2072 Law Enforcement Systems, Inc. $600 P.O. Box l348 Long Island City New York, NY lll0l Waste Management of Alameda County $200 l72 98th Avenue Oakland, CA 94603 Ebmud $90 P.O. Box 24055 Oakland, CA 94623 Smud $60 P.O. Box l5555 Sacramento, CA 958l8-8260 HUSKY ENERGY: Opens Ethanol Production Facility in Lloydminster --------------------------------------------------------------- Husky Energy Inc. has officially opened its Lloydminster Ethanol Plant in western Canada. The facility's expected annual production is 130 million litres of ethanol and 134,000 tonnes of Distillers Dried Grain with Solubles, a high protein feed supplement. The Company expects to purchase 350,000 tonnes of wheat per year from local producers for the manufacturing of ethanol. Husky's existing plant in Minnedosa, Manitoba, which has been producing ethanol from prairie grains since 1981, is currently being expanded from 10 to 130 million litres of ethanol per year. The new facility will become fully operational in mid-2007. "This project is a world class example of the growing value of biofuels and the important role cleaner burning fuels such as ethanol can play," Hon. Lorne Calvert, the Premier of Saskatchewan, said in the opening ceremony. "Husky has shown its confidence in the Saskatchewan economy with its major investment in this plant and leadership in making these fuels increasingly available to the public. We are proud to have created a climate in our province in which ethanol development and such investments occur." "The Lloydminster Ethanol Plant supports the Government of Saskatchewan's initiatives to establish a viable biofuels industry to enhance rural development. Husky has created 25 new jobs at the facility and will contribute to the local economy through the purchase of grain from producers in the surrounding areas," John C.S. Lau, the Company's president & chief executive officer said. Ethanol is a high-octane, alcohol based fuel additive produced from grain, including wheat. Ethanol-blended fuels offer several advantages over regular gasoline, including higher octane ratings, reduced tail-pipe emissions and protection from gas-line freezing. Headquartered in Calgary, Alberta, Husky Energy Inc. -- http://www.huskyenergy.ca/-- is an integrated energy and energy- related company with reserves of about 430 million barrels of oil and more than 2 trillion cu. ft. of natural gas. The company has about 500 gas stations in Canada, as well as heavy oil upgrader Lloydmaster. Husky Energy is publicly traded on the Toronto Stock Exchange under the symbol HSE. * * * Husky Energy Inc.'s junior subordinated debt carries Moody's Investor Service Ba1 rating. Moody's placed the rating on April 25, 2001 with a stable outlook. ICOA INC: June 30 Working Capital Deficit Tops $7.2 Million ----------------------------------------------------------- ICOA, Inc., posted a $91,102 net loss on $767,590 of net revenues for the three months ended March 31, 2006, compared to a $1.7 million net loss on $438,749 of revenues for the three months ended March 31, 2005. At March 31, 2006, the Company's balance sheet showed $5.3 million in total assets and $8.8 million in total liabilities, resulting in a $3.5 million stockholders' deficit. The Company's March 31 balance sheet also showed strained liquidity with $609,165 in total current assets available to pay $7.8 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?127a Going Concern Doubt Sherb & Co., LLP, in New York City, raised substantial doubt about ICOA, 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 auditing firm pointed to the Company's operating losses and working capital deficit. Headquartered in Warwick, Rhode Island, ICOA, Inc. (OTCBB:ICOA) -- http://www.icoacorp.com/-- sells, installs, supports, and provides wired and wireless Ethernet and Internet access services, primarily through Wi-Fi "hot spots" (public wireless local area networks). As of Dec. 31, 2004, ICOA owned or operated over 900 broadband access installations in high-traffic locations servicing millions of annual patrons in 44 states. In December 2005, ICOA owned or operated over 1,500 broadband access installations. INDUSTRIAL ENTERPRISES: Responds to Erroneous Schedule 13D Filing ----------------------------------------------------------------- Industrial Enterprises of America, Inc., responds to the 13D filing by Beryl Zyskind and disputes Mr. Zyskind's entitlement to any shares as alleged in his filing. The Company asserts that the filing by Mr. Zyskind is false and misleading. While the Company is currently in litigation regarding Mr. Zyskind's claims, the amount of shares claimed to be beneficially owned by Mr. Zyskind is outrageous and erroneous. The Company has numerous defenses to Mr. Zyskind's claims including, but not limited to: 1. An executed release that states, "The parties hereto warrant that this Mutual Release is to be of the broadest nature and is to be dispositive of all matters between the parties hereto." 2. That the $100,000 in question was not invested for the benefit of the Company and 3. That Mr. Zyskind has already received appropriate compensation for his claims. Management believes the timing of Mr. Zyskind's Schedule 13D filing demonstrates that it was not done for the purpose of complying with the securities law, but for the purpose of abusing the securities laws as a weapon for gaining unfair advantage in his civil litigation. The Company has contacted the Enforcement Division of the Securities and Exchange Commission regarding this abuse of the securities law and is considering all of its legal options at this time. The Company will also be commencing legal action to redress any potential harm to its shareholders. A full-text copy of the Schedule 13D Filing is available for free at http://ResearchArchives.com/t/s?1241 About Industrial Enterprises of America Headquartered in New York City, Industrial Enterprises of America, Inc. (OTCBB:IEAM) is an automotive aftermarket supplier that specializes in the sale of anti-freeze, auto fluids, and other automotive additives & chemicals. The company has distinct proprietary brands that collectively serve the retail, professional, and discount automotive aftermarket channels. Going Concern Doubt Beckstead and Watts, LLP, in Henderson, Nevada, raised substantial doubt about Industrial Enterprises' ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended June 30, 2005. The auditor pointed to the Company's net losses from its inception, and its limited operations, since the Company has not commenced planned principal operations. INLAND FIBER: Taps Perkins Coie to Assist in Oregon Asset Sale -------------------------------------------------------------- Inland Fiber Group, LLC, and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Perkins Coie LLP as their special counsel. The Debtors tell the Court that Perkins Coie will assist in the completion of the pending sale of their assets in Oregon. The Debtors disclose that attorneys at Perkins Coie bill between $230 and $440 per hour while paralegals and paralegal assistants bill between $50 and $170 per hour. Douglas R. Pahl, Esq., a partner at Perkins Coie, assures the Court that his firm does not hold or represent any interest adverse to the Debtors or their estates. Headquartered in Klamath Falls, Oregon, Inland Fiber Group LLC, aka U.S. Timberlands Klamath Falls LLC, and its affiliate Fiber Finance Corp., grow trees and sell logs, standing timber, and timberland. The Debtors filed a chapter 11 petition on Aug. 18, 2006 (Bankr. D. Del. Case Nos. 06-10884 & 06-10885). William P. Bowden, Esq. at Ashby & Geddes P. A. and Glenn E. Siegal, Esq. at Dechert LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, Inland Fiber reported $81,890,311 in total assets and $264,433,754 in total liabilities while its debtor-affiliate, Fiber Finance, disclosed $1,048 in total assets and $263,074,983 in total debts. ITEC ENVIRONMENTAL: Hires Rod Rougelot as Chief Executive Officer ----------------------------------------------------------------- Itec Environmental Group, Inc., has hired Rod Rougelot as new Chief Executive Officer. Mr. Rougelot will also join Itec's Board of Directors. Mr. Rougelot brings to Itec over 20 years of extensive experience in recycling, operations, finance, and mergers and acquisitions. Upon graduating from Harvard Business School, Mr. Rougelot founded Recycling Resource LLC, which rapidly became one of the leading recycling competitors in California. After Recycling Resource was acquired by Tomra Pacific, Inc., Mr. Rougelot served as President of the commercial division, building Tomra Pacific into one of the largest beverage container recyclers in the United States. Most recently, Mr. Rougelot was engaged through Stone Yamashita Partners as a strategic consultant with The Coca Cola Company. "Our goal with the ECO2(TM) System is to transform the plastics recycling industry by minimizing waste, reducing cost, and increasing the quality of materials sold to our customers," Mr. Rougelot stated. "My near term focus is to complete our fundraising efforts, build the plant to full capacity and rapidly scale our operations. We are in the process of building a management team around Gary De Laurentiis, which will carry his vision of the future of plastics recycling forward." Gary De Laurentiis will continue to serve as Itec's Chairman of the Board and in the newly created position of Chief Technology Officer. "With Rod joining the team, I have full confidence in our ability to drive Itec forward. The addition of Rod will enable me to focus on our technology, scale our existing operations and examine the technical aspects of our future plants," added Mr. De Laurentiis. About Itec Environmental Headquartered in Riverbank, California, Itec Environmental Group -- http://www.iteceg.com/-- offers solutions to pressing environmental problems faced by public agencies and private entities involved in the recycling of plastics. In a research partnership with Honeywell FM&T, Itec has developed and successfully commercialized a new system for the recycling of plastic containers. Its proprietary Eco2(tm) System costs 30% less to operate, uses no water, removes all contaminates and odors from the finished flake, is closed-loop and thus non-polluting, and produces no toxic by-products. At June 30, 2006, Itec Environmental Group's balance sheet showed a stockholders' deficit of $11,466,047, compared to a deficit of $2,333,960 at Sept. 30, 2005. INTERFACE INC: Moody's Assigns Loss-Given-Default Ratings --------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B2 Corporate Family Rating for Interface, Inc. Additionally, Moody's held its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $117 million 7.3% Sr. Notes due 2008 B2 B2 LGD3 49% $175 million 10.375% Sr. Notes due 2010 B2 B2 LGD3 49% $135 million 9.5% Sr. Sub. Notes due 2014 Caa1 Caa1 LGD5 89% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Interface Inc. -- http://www.interfacesustainability.com/-- is a manufacturer and marketer of floor coverings and fabrics headquartered in Atlanta, Georgia. INTERSTATE BAKERIES: Wants to Sell Portland Property for $3.65MM ---------------------------------------------------------------- Interstate Bakeries Corporation and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Western District of Missouri to sell their interests in a property located at 103 North Ivy Street and 115 North Cook Street, in Portland, Oregon, to NBS Real Estate Capital Management, LLC, for $3,650,000, free and clear of all liens other than certain permitted encumbrances and subject to higher bids. The Portland Property includes approximately 2.97 acres of land and several structures, including a former bakery building currently operated as a depot and a building currently operated as a thrift store. The Debtors are in the process of relocating their remaining depot operations at the Property, Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, relates. As part of their review of cost cutting opportunities, the Debtors determined that the Property should be sold subject to: (a) a Restrictive Covenant prohibiting the use of the Depot as a commercial bakery for the 60-month period right after the closing of the Property's sale; (b) a Depot Lease, which provides for the option to lease back the Depot and certain of the surrounding Land to the Debtors for a period of up to six months to enable the Debtors to secure a more suitable, cost efficient space in the area from which to conduct their depot operations; and (c) a Retail Lease, which provides for the option to lease back the Thrift Store to the Debtors for a period of up to 18 months to allow the Debtors to continue to operate their retail operations at the Property. The Debtors undertook thorough marketing efforts to identify potential buyers for the Property, with the assistance of the joint venture of Hilco Industrial, LLC, and Hilco Real Estate, LLC, Mr. Ory states. As part of the evaluation process, the Debtors considered the willingness of the interested buyers to lease back the Property to them as they have determined that the Depot and Retail Leases are necessary components of any agreement to sell the Property. Accordingly, the Debtors have decided to enter into an Asset Purchase Agreement with NBS Real Estate to become the stalking horse bidder for the Property. NBS Real Estate has agreed to purchase the Property for $3,600,000, subject to higher and better offers, the Restrictive Covenant, the Depot Lease and the Retail Lease. NBS Real Estate has also made a $365,000 deposit for the proposed sale. The Assets to be sold include all of the Debtors' rights in the Property and any building, fixtures or equipment permanently attached to the Property. The Assets exclude the personal property to the extent that the Debtors may choose to exercise their options to enter into the Depot and Retail Leases. The Restrictive Covenant will be recorded in the real property records of Multnomah County, Oregon, prior to the recording of the deed to the proposed purchaser. Under the APA, the Debtors have the right to terminate the Depot Lease and the Retail Lease at any time upon 30 days' prior notice. Monthly base rent under the Depot Lease is $4,000. On the other hand, monthly base rent under the Retail Lease is $1,600 for the first nine months and $2,100 for the second nine months. Both the Depot and the Retail Leases provide that the Debtors are responsible for the payment of utilities and NBS Real Estate is responsible for the payment of real property taxes. Bidding Procedures To maximize the value realized by the Debtors' estates from the sale of the Property, the Debtors will continue to seek and solicit higher and better bids using the Court-approved bidding procedures. If more than one bid is received, the Debtors intended to hold an auction on Sept. 22, 2006, at the office of Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois. The Debtors may change the Auction Date in their sole discretion. The minimum bid for the Property is $3,800,000. The Debtors have agreed to: -- provide bid protection to NBS Real Estate in the form of a $73,000 termination fee; and -- reimburse NBS Real Estate's reasonable and documented expenses of up to $50,000. In connection with the proposed sale, the Debtors seek the Court's authority to pay the Multnomah County tax collector: -- $26,847 and $448 in principal for real and personal property taxes due and owing for the 2004-2005 tax year; -- interest, accruing at 6% per annum beginning on the date that statutory interest began to accrue on the past due balance; and -- no penalties with respect to all delinquent taxes of the Property; and -- no fees relating to the release of any tax liens recorded against the Property for the tax year 2004-2005 and all prior tax years. The Debtors and the Successful Bidder will prorate 2006-2007 real and personal property taxes as of the Closing Date in accordance with the terms of the successful sale agreement. A full-text copy of the NBS Purchase Agreement is available for free at http://ResearchArchives.com/t/s?127b Multnomah County Responds Multnomah County, Oregon, filed a secured claim for $27,705, plus interest, against the Debtors for unpaid ad valorem property taxes for the tax year 2004 to 2005, Joanne B. Stutz, Esq., at Evans & Mullinix, P.A., in Shawnee, Kansas, relates. The Claim is not subject to any pending objection and is "deemed allowed" under Section 502(a) of the Bankruptcy Code, Ms. Stutz asserts. Ms. Stutz maintains that pursuant to the Oregon Revised Statutes, Multnomah County is entitled to interest on delinquent unpaid taxes at the rate of 1-1/3% per month, or 16% per annum. The Debtors, however, asserted that any interest due on taxes assessed against the Property should be capped at 6% per annum, and that any interest assessed in excess of that rate should be considered punitive and disallowed by the Court. The Debtors failed to provide any legal or factual basis for imposing that cap, Ms. Stutz contends. Ms. Stutz asserts that Multnomah County, as an oversecured creditor, is entitled to receive the rate of interest dictated by the statutes under which its lien arises, provided the charge can be reasonably characterized as true interest rather than as penalty. Ms. Stutz emphasizes that Multnomah County has a strong interest in collecting revenue due and owing so that it may meet the obligations and costs of operating the government. "Any interest that accrues on Multnomah County's Claim pursuant to the statutory interest rate is a valid part of the Claim." Accordingly, Multnomah County asks the Court to deny the Debtors' proposed sale to the extent: -- it proposes to reduce the interest rate on the Multnomah Claim to anything less than the allowed statutory interest rate provided by the Oregon Revised Statutes; and -- it seeks to sell the Property free and clear of liens where Multnomah County it has a claim secured by a lien on the Property and Multnomah County will not receive the total value of the secured claim, including any accrued interests. Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh baked bread and sweet goods, under various national brand names, including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R), Merita(R) and Drake's(R). The Company employs approximately 32,000 in 54 bakeries, more than 1,000 distribution centers and 1,200 thrift stores throughout the U.S. The Company and seven of its debtor-affiliates filed for chapter 11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No. 04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6.0% senior subordinated convertible notes due August 15, 2014 on August 12, 2004) in total debts. (Interstate Bakeries Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) INTERSTATE BAKERIES: Eyes $2.8 Mil. Wachovia Equipment Purchase --------------------------------------------------------------- Interstate Bakeries Corporation and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Western District of Missouri to purchase from Wachovia Financial Services, Inc., certain tractors and trailers with respect to the Schedule IV Agreement for $2,854,123 in the aggregate. Wachovia Financial Services, Inc., formerly known as First Union Commercial Corporation, and the Debtors were parties to an Equipment Lease dated May 19, 1992, three Schedules of Leased Equipment, and 12 associated Acceptance Certificates. Pursuant to the Agreements, Wachovia provided the Debtors with tractors, trailers, and route trucks. In August 2005, the Debtors purchased certain equipment from Wachovia pursuant to Schedule III Certificates, J. Eric Ivester, Esq., at Skadden Arps Slate Meagher & Flom LLP, in Chicago, Illinois, relates. Mr. Ivester tells the Court that each of the three Certificates under Schedule IV will reach the end of its basic term by Nov. 30, 2006. Pursuant to the Schedule IV Agreement, the Debtors will purchase from Wachovia the tractors and trailers in Certificates Nos. 1 through 3: Basic Term Certificate No. Equipment End Date Purchase Price --------------- ----------- ---------- -------------- 1 106 Tractors 07/19/2006 $1,786,029 2 96 Trailers 09/18/2006 643,735 3 27 Tractors 11/29/2006 424,359 -------------- Total $2,854,123 ============== The salient terms of the Schedule IV Agreement are: (a) Pursuant to the Master Lease, the Debtors will reimburse $26,000 to Wachovia for reasonable legal fees and expenses related to the Lease; (b) If all Basic Rent for the Basic Term of a Schedule IV Certificate has not been paid to Wachovia as of the tender of the respective Purchase Price, the unpaid Basic Rent will be paid in immediately available funds simultaneously with the payment of the Purchase Price. (c) The Purchase Price for each Schedule IV Certificate will be reduced dollar for dollar by the amount of Post-Term Rent, if any, paid by the Debtors to Wachovia after the end of the Basic Term for that Schedule IV Certificate; (d) The sale of all Schedule IV Equipment pursuant to the Agreement will be on an "as is/where is" basis, without Any representation by Wachovia except as to title and with the Debtors to bear all costs of transfer; (e) Wachovia may withhold delivery of titles of certain Schedule IV Equipment until it has received in immediately available funds the Purchase Price, its Legal Expenses and all due and payable Basic Rent on that Schedule IV Certificate. (f) The Agreement will be in full and final satisfaction of all of the parties' rights, claims and defenses with respect to Schedule No. IV, the Schedule IV Certificates, the Equipment, and any related provisions of the Master Lease. The Debtors waive their rights pursuant to Section 547 of the Bankruptcy Code as to any transfers made with respect to the Master Lease, the Schedules and the Certificates. (g) The Agreement does not prejudice any other right, claim or argument of the Debtors, Wachovia, or any party-in interest. (h) Wachovia will withdraw, with prejudice, Claim Nos. 6910 and 7803. Wachovia will also amend Claim No. 6917 to reduce it to an unsecured claim for $387,646. Mr. Ivester tells the Court that Schedule IV Equipment would be purchased at a discount of approximately 42% to the wholesale values for those equipment according to the National Automobile Dealers Association Official Commercial Truck Guide June 2006. Mr. Ivester contends that the tractors and trailers under the Schedule IV Certificates are some of the youngest in the Debtors' fleet and the least expensive to operate. The Debtors anticipate that they will continue to use the vehicles after the consolidation activities. TIP Responds Martin J. Weis, Esq., at Dilworth Paxson, LLP, in Philadelphia, Pennsylvania, relates that Transport International Pool, Inc., currently has eight trailers on lease with the Debtors. TIP has asked the Debtors to provide it a list of the trailers that they propose to purchase from Wachovia. TIP wants to confirm that none of the Wachovia trailers includes the trailers it leases to the Debtors. As of Sept. 20, 2006, the Debtors have not yet responded to TIP's request, Mr. Weis informs the Court. Hence, TIP asks the Court to deny the Debtors' request until: -- the Debtors can provide the requested information; and -- it has had undertaken a meaningful discovery to review the information and confirm that the trailers proposed to be purchase are not the ones it has leased. If found that the trailers do not belong to TIP, TIP would not object to the sale, Mr. Weis states. Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh baked bread and sweet goods, under various national brand names, including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R), Merita(R) and Drake's(R). The Company employs approximately 32,000 in 54 bakeries, more than 1,000 distribution centers and 1,200 thrift stores throughout the U.S. The Company and seven of its debtor-affiliates filed for chapter 11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No. 04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6.0% senior subordinated convertible notes due August 15, 2014 on August 12, 2004) in total debts. (Interstate Bakeries Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) JAMES QUILLEN: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: James Paul Quillen, Jr. P.O. Box 387 Parkton, MD 21120 Bankruptcy Case No.: 06-15938 Type of Business: The Debtor's affiliate, Cheasapeak Village, LLC, filed for chapter 11 protection on August 24, 2006 (Bankr. D. Md. Case No. 06-15094). Chapter 11 Petition Date: September 26, 2006 Court: District of Maryland (Baltimore) Judge: Robert A. Gordon Debtor's Counsel: Ronald J. Drescher, Esq. Drescher & Associates 4 Reservoir Circle, Suite 107 Baltimore, MD 21208 Tel: (410) 484-9000 Fax: (410) 484-8120 Estimated Assets: $10 Million to $50 Million Estimated Debts: $10 Million to $50 Million Debtor's 19 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Cheasapeake Bank of Maryland $6,492,283 2001 East Joppa Road Parkville, MD 21234 R.B. Young, LLC $5,600,000 P.O. Box 1825 Hagerstown, MD 21742 Citizens Bank of Pennsylvania $4,300,000 2001 Market Street Philadelphia, PA 19103 Mercantile Safe Deposit & Trust Co. $2,710,162 Two Hopkins Plaza Baltimore, MD 21202 Baltimore County Savings Bank $2,394,785 P.O. Box 397 Perry Hall, MD 21128 Susquehanna Bank $2,387,643 A. Gregory Manuel, V.P. 100 West Road, Suite 101 Towson, MD 21204 PNC Bank, N.A. $1,641,337 P.O. Box 340777 Carmichaels, PA 15320-7777 NVR, Inc. $1,513,000 10745 Birmingham Way Woodstock, MD 21163 Countrywide $1,478,750 7105 Corporate Drive PTX - B36 Plano, TX 75024 Carrollton Bank $1,336,504 P.O. Box 24195 Halethorpe, MD 21227-0692 Farmers & Merchant's Bank $1,310,205 c/o Thomas C. Myers, Sr. V.P. 9320 Lakeside Boulevard Owings Mills, MD 21117 American Fidelty Assurance Co. $1,207,652 5101 North Classen Boulevard, Suite 610 Oklahoma City, OK 73118 GS Newberry LLC $1,133,333 15 West Aylesbury Road, Suite 700 Lutherville Timonium, MD 21093 Anne Louise Perlow $1,000,000 1829 Reisterstown Road, Suite 380 Pikesville, MD 21208 TriSun Financial $996,089 1777 Reisterstown Road Baltimore, MD 21209 TOUSA Homes, Inc. $990,000 Technical Olympic USA, Inc. 555 Quince Orchard Road, Suite 530 Gaithersburg, MD 20878 Gordon Schaaf $790,000 23 Romar Drive Annapolis, MD 21403 CSX Realty $750,000 c/o Henry Abrams, Esq. Saul Ewing, LLP 500 East Pratt Street, Suite 900 Baltimore, MD 21202 Lennar $520,000 10211 Wincopin Circle, Suite 300 Columbia, MD 21044 JMR CONTRACTORS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: JMR Contractors Inc. P.O. BOX 4453 Vega Baja, PR 00694 Bankruptcy Case No.: 06-03205 Chapter 11 Petition Date: September 6, 2006 Court: District of Puerto Rico (Old San Juan) Judge: Enrique S. Lamoutte Inclan Debtor's Counsel: Francisco R. Moya Huff, Esq. BCO Popular Building, Suite 401 Tetuan 206 San Juan, PR 00901-1802 Tel: (787) 724-2447 Total Assets: $801,857 Total Debts: $1,061,334 Debtor's 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Departamento De Hacienda $136,926 P.O. Box 50074 San Juan, PR 00902-6274 Din Electrical Contractors, Inc. $101,440 Call Box 2020, Suite 254 Barceloneta, PR 00617 Internal Revenue Services $69,374 Mercantil Plaza Piso 9 San Juan, PR 00918 Corp. Del Fondo Del Seguro Del Estado $68,420 R&G Premier $66,880 Jaw's Electrical Group $66,250 Ferreteria M. Otero $64,768 E.D. Martinez, Inc. $31,449 Banco Popular De Puerto Rico $28,750 JMR Construction $25,779 Industrialsprinkler Corp. $25,042 Mercado Insulation Service $22,925 Municipality of Vega Baja $13,299 Lausell Inc. $11,130 Acha Trading Co., Inc. $10,028 Perry Products Co. $8,200 Citibank $7,870 PR Pumping $7,667 Homigonera Mayaguezana, Inc. $7,075 Buildex Corporation $6,766 J.P. MORGAN: Moody's Junks Rating on Class L & M Certs. ------------------------------------------------------- Moody's Investors Service downgraded the ratings of six classes and affirmed the ratings of ten classes of J.P. Morgan Chase Commercial Mortgage Securities Corp., Commercial Mortgage Pass- Through Certificates, Series 2002-C3: -- Class A-1, $130,831,254, Fixed, affirmed at Aaa -- Class A-2, $395,432,000, Fixed, affirmed at Aaa -- Class X-1, Notional, affirmed at Aaa -- Class X-2, Notional, affirmed at Aaa -- Class B, $27,950,000, Fixed, affirmed at Aaa -- Class C, $9,316,000, Fixed, affirmed at Aaa -- Class D, $24,224,000, Fixed, affirmed at Aa2 -- Class E, $9,316,000, Fixed, affirmed at Aa3 -- Class F, $22,360,000, WAC, affirmed at Baa1 -- Class G, $11,180,000, WAC, affirmed at Baa3 -- Class H, $14,907,000, Fixed, downgraded to Ba2 from Ba1 -- Class J, $13,043,000, Fixed, downgraded to B2 from Ba2 -- Class K, $2,795,000, Fixed, downgraded to B3 from Ba3 -- Class L, $3,727,000, Fixed, downgraded to Caa2 from B1 -- Class M, $7,453,000, Fixed, downgraded to Ca from B2 -- Class N, $4,658,000, Fixed, downgraded to C from Caa1 As of the Sept. 12, 2006 distribution date, the transaction's aggregate certificate balance has decreased by 7.9% to $686.4 million from $745.3 million at securitization. The Certificates are collateralized by 84 mortgage loans ranging in size from less than 1.0% to 5.8% of the pool, with the ten largest loans representing 38.7% of the pool. Nine loans, representing 14.6% of the pool, have fully defeased and are secured by U.S. Government securities. One loan has been liquidated from the pool, resulting in a realized loss of approximately $7.5 million. Two loans, representing 6.3% of the pool, are in special servicing, including the third largest loan in the pool -- The First National Plaza Portfolio Loan (4.9% of the pool). Moody's is projecting aggregate losses of approximately $20.7 million for the specially serviced loans. Ten loans, representing 14.4% of the pool, are on the master servicer's watchlist. Moody's was provided with full-year 2005 operating results for 89.1% of the pool. Moody's loan to value ratio, excluding the defeased loans, is 94.5%, compared to 90.2% at Moody's last review in December 2005 and compared to 92.4% at securitization. Moody's is downgrading Classes H, J, K, L, M, and N due to realized losses, decreased credit support and estimated losses on the specially serviced loans. The top three loans represent 15.9% of the outstanding pool balance. The largest loan is the ARC Portfolio B Loan ($39.8 million - 5.8%), which is secured by a portfolio of 14 manufactured housing communities containing 2,474 pads. The properties are located in seven states with concentrations in Colorado (30.6%), Texas (29.6%) and Florida (13.7%). The communities were established between 1952 and 1999. As it was at the time of our last review, the loan is on the master servicer's watchlist due to low debt service coverage. Financial performance since our last review, however, appears to be stable. The portfolio's overall occupancy was 84.8% as of year-end 2005, compared to 82.9% at year-end 2004 but down from 94.1% at securitization. The loan sponsor is Affordable Residential Communities, a major owner and manager of manufactured home communities. Moody's LTV is 97.6%, compared to 98.6% at last review and compared to 88.3% at securitization. The second largest loan is the Long Island Industrial Portfolio III Loan ($35.9 million - 5.2%), which is secured by nine industrial buildings totaling 700,660 square feet. The properties are located in Nassau and Suffolk Counties on Long Island, New York. The properties range in size from 21,900 to 186,000 square feet and were constructed between 1964 and 1984. Since our last review, the property's performance has stabilized given an increase in occupancy and net operating income, which has led to improved debt service coverage. As a result the loan was removed from the master servicer's watchlist. Year end 2005 occupancy was 93.6%, compared to 82.9% at year-end 2004 and compared to 93.3% at securitization. Moody's LTV is 92.2%, compared to 93.3% at last review and compared to 94.4% at securitization. The third largest loan is the First National Plaza Portfolio Loan ($33.5 million - 4.9%), which is secured by three Class B office buildings located in downtown Dayton, Ohio. The buildings total 655,000 square feet. One building was built in 1956 and the other two were built in 1972; all three were renovated in 1999. Financial performance has declined since securitization due to lease rollover and weak market conditions. The portfolio's overall occupancy was 59.0% as of June 2006, compared to 72.0% at last review and compared to 86.0% at securitization. Market vacancy for Class B/C office space in downtown Dayton has increased from 15.2% at securitization to approximately 22.4% at year-end 2005. The loan was transferred to the special servicer in March 2006 because of imminent default. The property has not covered debt service for more than three months. Moody's LTV is in excess of 100.0%. The pool's collateral is a mix of retail (29.4%), office and mixed use (24.0%), multifamily and MHC (19.1%), U.S. Government securities (14.6%), industrial and self storage (10.9%) and lodging (2.0%). The collateral properties are located in 30 states. The highest state concentrations are New York (14.6%), New Jersey (10.5%), Ohio (9.6%), Virginia (7.7%) and Florida (6.6%). All the loans are fixed rate. LEHMAN BROTHERS: Moody's Lowers Class K Note's Rating to Ba2 ------------------------------------------------------------ Moody's Investors Service downgraded the ratings of two classes and confirmed or affirmed the ratings of 14 classes of Lehman Brothers Floating Rate Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2005-LLF C4 as follows: -- Class A-1, $344,409,602, Floating, affirmed at Aaa -- Class A-2, $182,469,000, Floating, affirmed at Aaa -- Class X-1, Notional, affirmed at Aaa -- Class X-2, Notional, affirmed at Aaa -- Class X-1-FAIR, Notional, affirmed at Aaa -- Class X-1-HRO, Notional, affirmed at Aaa -- Class B, $24,328,000, Floating, affirmed at Aa1 -- Class C, $22,117,000, Floating, affirmed at Aa2 -- Class D, $13,270,000, Floating, affirmed at Aa3 -- Class E, $13,270,000, Floating, affirmed at A1 -- Class F, $13,270,000, Floating, affirmed at A2 -- Class G, $13,270,000, Floating, confirmed at A3 -- Class H, $15,482,000, Floating, confirmed at Baa1 -- Class J, $14,376,000, Floating, downgraded to Baa3 from Baa2 -- Class K, $25,438,398, Floating, downgraded to Ba2 from Baa3 -- Class WFV, $4,900,000, Floating, affirmed at Baa3 The Certificates are collateralized by ten mortgage loans which range in size from 1.2% to 17.9% of the aggregate pool balance based on current principal balances. As of the Sept. 15, 2006 distribution date, the aggregate certificate balance has decreased by approximately 16.7% to $1.1 billion from $1.3 billion at securitization due to the payoff of six loans initially in the pool. The Certificates receive principal payments on a senior sequential basis. Seven loans, representing 69.4% of the pool balance, have performed in line with Moody's expectations, while three loans, representing 30.6% of the pool balance, have performed below Moody's expectations. The loans performing below Moody's expectations are the IMT Central Florida Portfolio Loan, the Genesee Valley Center Loan and the Kaminski Minnesota Portfolio Loan. On Aug. 3, 2006 Moody's placed Classes G, H, J and K on review for possible downgrade. Moody's is downgrading Classes J and K due to the poor performance of above referenced loans. The HRO Hotel Portfolio Loan (17.9%) is secured by seven full service hotels located in Connecticut, Virginia, Georgia, Michigan, California and Maryland. Four of the hotels are flagged as Sheratons, two as Westins and one as a Hilton. Moody's initial evaluation anticipated improvement in the performance of the collateral. While 2005 performance did not measure up to expectations partially due to renovations, net cash flow for the trailing twelve months ended June 2006 was $19.6 million compared to Moody's expectation of $20.9 million. It is anticipated that full year 2006 performance would approximate the Moody's expectation. The borrower is an affiliate of HEI Hospitality, LLC. The loan's LTV ratio is 63.3% the same as at securitization. The loan is currently shadow rated Baa2, the same as at securitization. The Westfield Shoppingtown Valencia Loan (15.4%) is secured by a 465,300 square foot portion of an 858,200 square foot regional mall located in Valencia, California. Anchor tenants include J.C. Penney, Macys and Sears. Collateral occupancy is 94.4%, compared to 87.3% at securitization. The borrower is an affiliate of The Westfield Group, Inc. Comparable tenant sales were $448 per square foot for the 12-month period ending March 2006, compared to $432 per square foot at securitization. Based on Moody's adjusted cash flow of $13.0 million and a normalized capitalization rate, the loan to value ratio is 66.7%, compared to 67.0% at securitization. Moody's current shadow rating is Baa2, the same as at securitization. The 110 William Street Loan (13.2%) is secured by an 867,900 square foot office building located in lower Manhattan. Collateral occupancy is 95.3%, compared to 86.0% at securitization. The borrower is an affiliate of Swig Equities, LLC and Longwing Real Estate Ventures, LLC. Moody's LTV and shadow rating are 67.4% and Baa2 respectively, the same as at securitization. The IMT Central Florida Portfolio Loan (10.8%) is secured by six multifamily properties (2,008 units) located in Tampa, Orlando and Jacksonville, Florida. Portfolio occupancy as of March 31, 2006 was 96.9%, compared to 91.1% at securitization. Actual net operating income for calendar year 2005 and budgeted net operating income for calendar year 2006 are significantly below Moody's expectations due to declines in rent achievement and increases in operating expenses. The borrower is an affiliate of Investors Management Trust and Lehman Brothers Real Estate Partners. Based on Moody's adjusted cash flow of $7.7 million and a normalized capitalization rate, the LTV is 81.0%, compared to 64.7% at securitization. Moody's current shadow rating is B1, compared to Baa2 at securitization. The Genesee Valley Center Loan (10.4%) is secured by a 475,200 square foot portion of a 1.3 million square foot regional mall located in Flint, Michigan. Anchor tenants include Macys, Sears, J.C. Penney and Burlington Coat Factory (not yet opened). A 70,000 renovation/expansion of a former anchor store into street- side stores was completed in early 2006. Barnes & Noble leased 26,400 square feet of the renovation. Collateral occupancy is 81.8% and leases out for signature amount to an additional 5.2%. The borrower is an affiliate of Walton Street Capital, LLC. Comparable tenant sales were $300 per square foot for the 12-month period ending March 2006, compared to $340 per square foot at securitization. Based on Moody's adjusted cash flow of $9.2 million and a normalized capitalization rate, the LTV is 69.7%, compared to 61.1% at securitization. While the borrower has made good, although slower than anticipated, progress in redeveloping the center, significant credit concerns remain given the poor economic outlook for the region. Moody's current shadow rating is Baa3, compared to Baa2 at securitization. The Fairfield Inn by Marriott Portfolio Loan (10.1%) is secured by 18 limited service hotels located in eight states. The properties are approximately 20 years old but were substantially renovated between 2000 and 2004. Collateral properties are located in secondary markets in Connecticut (3), Maryland (3), New Hampshire, Massachusetts, New Yor, Maine, Rhode Island and Vermont. The borrower is an affiliate of Olympus Real Estate Partners. Performance for the trailing 12-month period ending August 2006 was in line with Moody's expectations. Based on Moody's adjusted cash flow of $12.2 million and a normalized capitalization rate, the LTV is 64.2%, compared to 63.7% at securitization. Moody's current shadow rating is Baa2, the same as at securitization. The Kaminski Minnesota Portfolio Loan (9.4%) is secured by 23 Class B office properties located in three office parks in the Minneapolis-St Paul area. Portfolio occupancy as of March 2006 was approximately 77%, compared to 80.6% at securitization. Actual net operating income for calendar year 2005 and budgeted net operating income for calendar year 2006 are substantially below Moody's expectations. The borrower is an affiliate of M.G. Kaminski. Based on Moody's adjusted cash flow of $8.7 million and a normalized capitalization rate, the LTV is 72.6%, compared to 66.1% at securitization. Moody's current shadow rating is Ba2, compared to Baa2 at securitization. The borrower is exploring redevelopment of portions of the collateral, which may result to a near term payoff of the loan. LEVITZ HOME: Wants to Reject Lease for Store No. 40203 ------------------------------------------------------ Levitz Home Furnishings, Inc., and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to reject Store No. 40203, effective as of Oct. 31, 2006, pursuant to Section 365 of the Bankruptcy Code. Debtor Levitz Furniture Corp. is a party to a lease dated Nov. 2, 1983, with Brittan Corner Shopping Center as landlord for the premises located at 1119 Industrial Road in San Carlos, California. In accordance with the Sale Order, on Aug. 31, 2006, PLVTZ, LLC, and The Pride Capital Group, as purchasers of substantially all of the Debtors' assets, served on the Debtors an excluded lease notice, which identified the San Carlos Lease for Store No. 40203 as an excluded lease. Upon receipt of the Excluded Lease Notice, the Debtors reviewed Store No. 40203 and determined that it no longer provides any benefit to their estates or creditors, Nicholas M. Miller, Esq., at Jones Day, in New York, tells the Court. 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. 20; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) LIFESTYLE ENT: Case Summary & 27 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Lifestyle Enterprises, Inc. 3025 M Street, Northwest Washington, DC 20007 Bankruptcy Case No.: 06-00317 Chapter 11 Petition Date: September 11, 2006 Court: District of Columbia (Washington, D.C.) Judge: S. Martin Teel, Jr. Debtor's Counsel: Steven H. Greenfeld, Esq. Cohen, Baldinger & Greenfeld LLC 7910 Woodmont Avenue Suite 760 Bethesda, Maryland 20814 Tel: (301) 881-8300 Fax: (301) 881-8350 Estimated Assets: $100,000 to $500,000 Estimated Debts: $1 Million to $10 Million Debtor's 27 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Provident Bank $328,672 P.O. Box 2394 Baltimore, MD 21203-2394 Marblehead Mgmt., LLC $200,000 2954 Burrland Lane The Plains, VA 20198 DC Treasurer $90,349 Office of Tax and Revenue P.O. Box 7792 Washington, DC 20044-7792 Mabro $71,680 ETRO $51,010 Eastbanc/Georgetown Restructuring, LLC $45,000 Well's Fargo, LC $29,373 Kadcon $23,477 MBNA Bank, LC $22,445 Maxwell Reinstein Chartered $20,000 Bank of America, LC $15,990 Bank of America - Visa $9,114 Mario Gerlin $8,978 CitiBusiness Visa $8,920 Temperley Lone $7,554 D Squared/2 $7,542 Delta SkyMiles Amex $6,696 David Wals/T-Shirts SA $6,945 Modern Luxury, LLC $5,428 Essentiel $4,949 Helene Clement $4,742 G.Kay Kashmere $4,726 Stella Forest $4,375 Vivienne Westwood $4,323 Heyne Bogut $4,230 Capital One Platinum Business Visa $3,925 Ellego $3,792 MARSH & MCLENNAN: Names M. Michele Burns as Mercer Chairman, CEO ---------------------------------------------------------------- Marsh & McLennan Companies, Inc., has named M. Michele Burns, chief financial officer of MMC, to the position of chairman and chief executive officer of Mercer Human Resource Consulting, an MMC subsidiary and global leader for HR and related financial advice and services. Ms. Burns succeeds Michael Caulfield, who will be retiring. Mr. Caulfield will remain with the company until the end of the year to ensure an orderly transition. Moving into the role of CFO for MMC is Matthew B. Bartley, who has served as MMC's treasurer since 2001. Ms. Burns and Mr. Bartley will assume their new positions effective immediately. "We are pleased to be announcing these important changes to our management team," said Michael G. Cherkasky, MMC president and CEO. "Michele brings a compelling mix of financial acumen and managerial experience in professional services to her new role. She has a proven track record of successfully leading large professional teams, and her focus will be on driving Mercer HR's growth and profitability while continuing to reinforce its leadership position in HR consulting and HR products and solutions." Commenting on Matt Bartley's promotion to the role of MMC CFO, Mr. Cherkasky continued: "Matt is a seasoned and extremely talented finance professional with demonstrated strategic and leadership skills. He played a pivotal role in solidifying MMC's financial condition during a critical period. He brings to his new role an intimate knowledge of the financial dynamics of MMC's operating companies, and will be able to hit the ground running as a significant contributor to MMC's financial recovery and growth." Ms. Burns, 48, joined MMC in March 2006 as executive vice president and chief financial officer. A director of Wal-Mart Stores, Inc. and Cisco Systems, Inc., she previously served as executive vice president, chief restructuring officer, and chief financial officer at Mirant Corporation following the company's bankruptcy filing in 2003, where she spearheaded the development of a new capital structure and business reorganization plan. Joining Delta Air Lines in 1999 and named CFO in 2000, she managed a global staff of more than 3,500 in finance, information technology, business development, investor relations, and supply chain, fleet and risk management. "I look forward to leading Mercer Human Resource Consulting during this exciting time in the company's history," Ms. Burns said. "Mercer HR is the world leader in helping companies address their human resource needs at a time when the dynamic role of human capital is leading the conversation in countries and economies around the globe. Together, we will take this business to the next level." Ms. Burns began her career at Arthur Andersen in 1981, where she held regional and national leadership roles in a number of practices. As a senior partner, she led Andersen's Southern Region Federal Tax Practice, headed its U.S. Healthcare Practice and its Southeastern Region Financial Services Practice, and served on its Global Advisory Council. Ms. Burns graduated summa cum laude from the University of Georgia with a bachelor's degree in business administration and a master's degree in accountancy. Mr. Bartley, 49, joined MMC as vice president and treasurer in 2001. Since then, he has been instrumental in raising MMC's financial profile in the public debt markets, marshalling its financial resources, and adjusting its capital structure to meet the changing requirements of its operating companies. His responsibilities have encompassed strategic corporate finance, credit agency relationships, cash management and fiduciary investments, pension funding and investments, as well as risk management and business continuity planning. "The CFO role provides a great opportunity for me to help MMC meet and exceed its financial goals," Mr. Bartley said. "Over the past two years, we have made tremendous progress furthering MMC's financial recovery. Going forward, we have set our sights on taking our leading brands to the next level by securing a solid financial platform from which to operate and grow profitably." Mr. Bartley served for nearly 10 years in senior international treasury and tax positions at PepsiCo, Inc., where he was responsible for global strategic transaction planning and execution across international operating businesses. He subsequently served as vice president of taxes at Engelhard Corporation, a multinational specialty chemicals and precious metals company, with responsibility for tax and transaction planning, execution and reporting. He began his career as a tax attorney with Morgan, Lewis and Bockius, a global law firm headquartered in Philadelphia. Mr. Bartley holds a bachelor's degree from the University of Pennsylvania, a master's degree from Yale University, and a law degree from the Columbia University School of Law. "On behalf of the entire management team, I would like to thank Michael Caulfield for his excellent leadership of Mercer Human Resource Consulting during this critical period," Mr. Cherkasky continued. "We wish him all the best in his retirement." About Marsh & McLennan Marsh & McLennan Companies, Inc. -- http://www.mmc.com/-- is a global professional services firm with annual revenues of approximately $12 billion. It is the parent company of Marsh, the world's leading risk and insurance services firm; Guy Carpenter, the world's leading risk and reinsurance specialist; Kroll, the world's leading risk consulting company; Mercer, a major global provider of human resource and specialty consulting services; and Putnam Investments, one of the largest investment management companies in the United States. Approximately 55,000 employees provide analysis, advice, and transactional capabilities to clients in over 100 countries. * * * As reported in the Troubled Company Reporter on Aug. 25, 2006, Standard & Poor's Ratings Services assigned its preliminary 'BBB' senior debt, 'BBB-' subordinated debt, and 'BB+' preferred stock ratings to Marsh & McLennan's unlimited universal shelf. Standard & Poor's also affirmed its 'BBB' counterparty credit rating on MMC. The outlook in negative. MEDAREX INC: Seeks Default Waiver from 2.25% Sr. Note Holders ------------------------------------------------------------- Medarex, Inc., is soliciting consents from the holders of its outstanding 2.25% Convertible Senior Notes in the aggregate principal amount of $150 million due May 15, 2011. The consent solicitation is relative to an amendment of certain reporting requirements and a waiver of defaults and events of default in the indenture governing the Notes. As reported in the Troubled Company Reporter on Sept. 5, 2006 the Company received a notice of default from Citadel Equity Fund Ltd., holder of more than 25% in principal amount of the outstanding Notes. Citadel cited the Company's failure to file its Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, as the basis for the notice of default. The notice of default further provides that if the Company does not file its Form 10-Q by Oct. 24, 2006, an event of default under the Indenture will exist. The Company disclosed that the proposed amendment to the indenture will provide it with additional time to comply with the reporting requirements and would obviate the need to make any further filings or furnish any additional reports or information pursuant to the indenture's reporting provisions. The proposed amendment also includes a waiver of all defaults and events of default under the indenture's reporting requirements. The Company will make cash payments to: (i) consenting holders of the Notes as of Sept. 21, 2006 of $2.50 per $1,000 in aggregate principal amount of the Notes held by the consenting holders, upon or promptly following execution of the supplemental indenture for the Notes; and (ii) all record holders of the Notes on Oct. 24, 2006 of an additional $10 per $1,000 in aggregate principal amount of the Notes, if the Company has not filed an amendment to its 2005 Form 10-K containing restated financial statements, an amendment to its quarterly report on Form 10-Q for the quarter ended March 31, 2006 and its Second Quarter Form 10-Q, by the close of business on Oct. 24, 2006. The consent solicitation will expire at 5:00 p.m. New York City time on Oct. 4, 2006. The Company has retained Goldman, Sachs & Co. to serve as the Solicitation Agent and Global Bondholder Service Corporation to serve as Information Agent and Depositary for the consent solicitation. Requests for documents may be made directly to Global Bondholder Services Corporation by telephone at 866-873- 6300 (toll free) or 212-430-3774 (banks and brokers), or in writing at 65 Broadway, Suite 723, New York, New York 10006, Attention: Corporate Actions. Questions regarding the solicitation of consents may be directed to Goldman, Sachs & Co. at 800-828-3182 (toll free) or 212-902-9077 (collect), Attention: Credit Liability Management Group. Headquartered in Princeton, New Jersey, Medarex Inc., (Nasdaq: MEDX) -- http://www.medarex.com/-- is a biopharmaceutical company focused on the discovery, development and potential commercialization of fully human antibody-based therapeutics to treat life-threatening and debilitating diseases, including cancer, inflammation, autoimmune disorders and infectious diseases. MEGA BRANDS: Moody's Assigns Loss-Given-Default Ratings ------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency revised its Ba3 Corporate Family Rating to B1 for MEGA Brands Inc. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans facilities: Issuer: MEGA Brands Inc. Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2010 Ba3 Ba2 LGD2 24% Sr. Sec. Term Loan A Due 2010 Ba3 Ba2 LGD2 24% Issuer: Mega Blocks US Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2010 Ba3 Ba2 LGD2 24% Issuer: Mega Blocks Finco Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Term Loan B Due 2012 Ba3 Ba2 LGD2 24% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Montreal, Canada-based Mega Brands Inc. fka Mega Bloks Inc. -- http://www.megabloks.com/-- distributes a range of toys, puzzles, and craft-based products worldwide. MERIDIAN AUTOMOTIVE: Disclosure Statement Hearing Set on Oct. 10 ---------------------------------------------------------------- Meridian Automotive Systems, Inc., and its eight debtor- affiliates ask the U.S. Bankruptcy Court for the District of Delaware to approve their Disclosure Statement explaining their Fourth Amended Joint Plan of Reorganization as containing adequate information within the meaning of Section 1125(a)(1) of the Bankruptcy Code. The Court will convene a hearing on Oct. 10, 2006, to consider approval of the Disclosure Statement. Edward J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, notes that Section 1125 requires the Court to approve a written disclosure statement prior to allowing a debtor to solicit acceptances for a plan of reorganization. To approve a disclosure statement, the Court must find that the disclosure statement contains adequate information defined as "information of a kind, and in sufficient detail . . . that would enable a hypothetical reasonable investor typical of holders of claims or interests [of the Debtors] . . . to make an informed judgment about the plan." Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) MERIDIAN AUTOMOTIVE: Wants Solicitation Procedures Established -------------------------------------------------------------- Meridian Automotive Systems, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to establish uniform procedures for the solicitation and tabulation of votes to accept their Fourth Amended Joint Plan of Reorganization. Solicitation Packages After the Court approves the Disclosure Statement, the Debtors propose to distribute or cause to be distributed solicitation packages to those Holders of Claims in Classes entitled to vote on the Plan, containing copies of: (a) a CD-ROM containing the Disclosure Statement, together with the Plan and other exhibits; (b) the Solicitation Order, excluding its exhibits; (c) a notice of the Confirmation Hearing; (d) a ballot together with a return envelope; and (e) other materials as the Court may direct or approve, including supplemental solicitation materials the Debtors may file with the Court. With respect to any transferred Claim, the Debtors propose that the transferee will be entitled to receive a Voting Solicitation Package and cast a ballot on account of the transferred Claim only if: (a) all actions necessary to effect the Claim transfer have been completed by the Record Date; or (b) the transferee files, not later than the Record Date: * the required documentation to evidence that transfer; and * a sworn statement of the transferor supporting the validity of the transfer. In the event a Claim is transferred after the transferor has executed and submitted a ballot to the voting agent, The Trumbull Group, LLC, the transferee will be bound by any vote made on the ballot by the Holder as of the Record Date of the Transferred Claim. Holders of Claims in the Unimpaired Non-Voting Classes will receive: (a) the Confirmation Hearing Notice; and (b) a notice of their non-voting status under the Plan. The Debtors propose that they not be required to transmit a solicitation package to the Rejecting Classes, as these Classes are presumed to have rejected the Plan. The Debtors expect to commence distribution of the Voting Solicitation Packages, the Unimpaired Notices of Non-Voting Status, and the Rejecting Class Notices no later than six days after the Court approves the proposed Solicitation Procedures. Any party wishing to obtain a copy of the Disclosure Statement and the Plan can do so by accessing the documents on the Internet, free of charge, at http://www.trumbullgroup.com/or by contacting the Voting Agent to obtain a copy of the documents at the Debtors' expense. Ballot Forms The Debtors propose to distribute to creditors one or more ballot forms based on Official Form No. 14, but have been modified to address the particular aspects of the Debtors' Chapter 11 cases. The appropriate ballot forms, along with return envelopes, will be distributed to the Voting Classes: Class Type of Claim ----- ------------- 3 Prepetition First Lien Claims 4 Prepetition Second Lien Claims 5 General Unsecured Claims The Plan designates four claim categories as unclassified for purposes of voting on and receiving distributions under the Plan. The Holders of these unclassified Claims are not entitled to vote to accept or reject the Plan: 1. Administrative Expense Claims, 2. DIP Claims, 3. Priority Tax Claims, and 4. Professional Compensation Claims. Voting Deadline The Debtors ask the Court to fix November 10, 2006, at 4:00 p.m. Eastern Time, as the deadline by which all original ballots must be properly executed, completed, delivered to, and received by the Voting Agent. Temporary Allowance The Debtors propose that if any party wishes to have its Claim allowed for voting purposes, that party must serve on the Debtors and file with the Court no later than 10 days before the Voting Deadline a motion temporarily allowing the Claim for purposes of voting. The Debtors ask the Court to fix November 7, 2006, as the date to consider all those motions. Confirmation Hearing The Debtors ask the Court to fix November 17, 2006, at 10:30 a.m. Eastern Time, as the Plan Confirmation Hearing, which may be continued from time to time without further notice to creditors or other parties-in-interest. The Debtors propose to publish the Confirmation Hearing Notice in The Detroit Free Press, USA Today, and the national edition of The Wall Street Journal, not less than 11 days after the Solicitation Commencement Date. Confirmation Objection Deadline The Debtors ask the Court to fix Nov. 10, 2006, at 4:00 p.m. Eastern Time, as the last date for filing and serving written objections to the confirmation of the Plan. Objections, if any, to the confirmation of the Plan must: (i) be made in writing; (ii) state the name and address of the objecting party and the nature of the Claim or the party's interest; (iii) state with particularity the legal and factual basis and nature of any objection to the Plan; and (iv) be filed with the Court, together with proof of service and served so that they are received on or before the Objection Deadline by: * the Debtors' counsel, * the United States Trustee, and * the Creditors' Committee's counsel. Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) MERIDIAN AUTOMOTIVE: Court Okays DIP Financing Amendments --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware permits Meridian Automotive Systems, Inc., and its debtor-affiliates to amend the DIP Credit Facility, as modified by representations made by the Debtors' counsel at last week's hearing. Judge Walrath authorizes the Debtors to increase, by 0.25%, the interest rate accruing on all borrowings under the DIP Credit Facility. The modified Amended DIP Credit Facility provides that: -- The Global EBITDAR for the Global Entities for each rolling 12-fiscal month period ending on the last day of each fiscal month will not be less than $40,000,000; -- Each Eurodollar Loan will bear interest at a rate per annum equal to the Adjusted LIBO Rate for such Interest Period in effect for such Borrowing plus 4.00%; and -- The Maturity Date of the DIP Facility is extended to the earlier of: (a) December 31, 2006, provided that it will be automatically extended to February 15, 2007, if the Borrower will have timely paid to the Agent for the ratable benefit of the lenders, an extension fee in an amount equal to 0.25% multiplied by the Total Commitment as of the Scheduled Termination Date; and (b) the Consummation Date, if any. A full-text copy of the Court-approved Amended DIP Credit Facility is available at no charge at http://ResearchArchives.com/t/s?127c In connection with their Fourth Amended Joint Plan of Reorganization and in light of recent Original Equipment Manufacturer production cutback and their delayed emergence from bankruptcy, the Debtors proposed to amend their Revolving Credit and Guaranty Agreement dated June 30, 2005. The Debtors wanted to ensure that they would have sufficient working capital for the duration of their Chapter 11 cases. Credit Suisse, Cayman Islands Branch, serves as Administrative Agent while General Electric Capital Corporation serves as Collateral Agent under the DIP Credit Facility. Specifically, pursuant to Sections 105(a) and 363(b) of the Bankruptcy Code and the Final DIP Order, the Debtors asked the Court for permission to: (a) amend the DIP Credit Facility to allow for a contingent increase to the interest rate on certain borrowings; and (b) pay certain fees to the Administrative Agent and DIP Lenders in connection with an Amended DIP Credit Facility. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, relates that the DIP Lenders have agreed to waive the Borrowing Base limitations of the current DIP Credit Facility and allow the Debtors to borrow up to the full $75,000,000 Total Commitment. The Debtors covenant that they will not permit cumulative Global EBITDAR for the Global Entities for each following 12-fiscal month period ending on the last day of each fiscal month to be less than $35,000,000. The Maturity Date of the DIP Facility is extended to the earlier of: (a) December 31, 2006, provided that it will be automatically extended to March 31, 2007, if the Borrower will have timely paid to the Agent for the ratable benefit of the lenders, an extension fee in an amount equal to 0.25% multiplied by the Total Commitment as of the Scheduled Termination Date; and (b) the Consummation Date, if any. The Borrower will pay a $187,500 fee to the Agent for distribution to the Lenders. Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. Eric E. Sagerman, Esq., at Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. The Committee also hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an adversary proceeding against Meridian's First Lien Lenders and Second Lien Lenders to invalidate their liens. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). MERRIL LYNCH: Moody's Assigns Ba2 Rating to Class B Certificate --------------------------------------------------------------- Moody's Investors Service assigned an Aaa rating to the senior certificate issued by Merrill Lynch Mortgage Investors Trust 2006- SD1 and ratings ranging from Aa2 to Ba2 to the subordinate certificates in the deal. The securitization is backed by Wilmington Finance, Inc., AIG Federal Savings Bank, Ownit Mortgage Solutions Inc., and other mortgage lenders originated, adjustable-rate (75%) and fixed-rate (25%), scratch & dent mortgage loans acquired by Merrill Lynch Mortgage Lending Inc. The ratings are based primarily on the credit quality of the loans and on protection against credit losses by subordination, excess spread, and overcollateralization. The rating also benefit from an interest-rate swap provided by Bear Stearns Financial Products Inc. Moody's expects collateral losses to range from 9% to 9.50%. Wilshire Credit Corporation will service the loans. Moody's has assigned Wilshire its servicer quality rating of SQ2+ as a servicer of subprime mortgage loans. These are Moody's complete rating actions: * Merrill Lynch Mortgage Investors Trust * Mortgage Loan Asset-Backed Certificates, Series 2006-SD1 Cl. A Certificate, Assigned Aaa Cl. M-1 Certificate, Assigned Aa2 Cl. M-2 Certificate, Assigned A2 Cl. M-3 Certificate, Assigned Baa2 Cl. B Certificate, Assigned Ba2 MEYER'S BAKERIES: Court Sets November 6 as Claims Bar Date ---------------------------------------------------------- The Honorable James G. Mixon of the U.S. Bankruptcy Court for the Western District of Arkansas set Nov. 6, 2006, as the last day for persons owed money by Meyer's Bakeries Inc. and its debtor- affiliates to file proofs of claim. Proofs of claim must be filed with or mailed to: Clerk of Court U.S. Bankruptcy Court Western District of Arkansas 300 W. Second Street Little Rock, AR 72201 Headquartered in Hope, Arkansas, Meyer's Bakeries Inc. produces English muffins, bagels, bread sticks, energy bars, and hearth baked specialty breads and rolls. The Company and its affiliates filed for chapter 11 protection on Feb. 6, 2005 (Bankr. W.D. Ark. Case No. 05-70837). On March 23, 2006, the Debtors case was converted into a chapter 7 proceeding (Bankr. W.D. Ark. Case No. 05-70837). Charles T. Coleman, Esq., Judy Simmons Henry, Esq., and Kimberly Wood Tucker, Esq., at Wright, Lindsey & Jennings LLP represent the Debtors. Richard L. Cox is trustee overseeing the Debtors' liquidation. The Trustee is represented by his firm RICHARD COX, P.A. in Hot Springs, AR. No Official Committee of Unsecured Creditors has been appointed in this case. When the Company filed for protection from its creditors, it listed total assets of $44,226,139 and total debts of $48,699,754. METABOLIFE INT'L: PI Claimants Want Stay Lifted to Continue Suit ---------------------------------------------------------------- Claimants Jerome Kreutzer and Susana Vega Kreutzer ask the U.S. Bankruptcy Court for the Southern District of California to lift the automatic stay to allow prosecution of personal injury claims against MII Liquidation, Inc., fka Metabolife International, Inc. On July 8, 1999, Jerome suffered a massive stroke while showering. The neurologist who treated him concluded that his stroke was causally related to the dietary supplement Metabolife 356 that Jerome had been taking consistently over the preceding months. On June 26, 2000, Jerome and his wife Susana sued Metabolife, together with its sales representatives Richard Tow and Wendy Tow in the San Diego Superior Court. The Tows sold the product to Jerome and made various representations concerning its quality and safety. William M. Low, Esq., at Higgs, Fletcher & Mack, LLP, verified that the claims alleged by the Kreutzers' complaint were all covered by various insurance policies collectively exceeding $40 million. Thereafter, on June 30, 2005, while the Kreutzers' state action was pending in the state coordinated proceeding, Metabolife filed for bankruptcy. Because Metabolife has adequate insurance coverage to pay any possible judgment on the Kreutzers' claim, there would be no prejudice to Metabolife or its estate from continued prosecution of the state court action, especially since the Kreutzers have stipulated to collect any possible judgment solely from the insurance carrier. Headquartered in San Diego, California, Metabolife International, Inc. -- http://www.metabolife.com/-- sells dietary supplements and management products in grocery, drug and mass retail locations nationwide. The Company and its subsidiary, Alpine Health Products, LLC, filed for chapter 11 protection on June 30, 2005 (Jointly Administrated Under Bankr. S.D. Calif. Case No. 05-06040). David L. Osias, Esq., and Deb Riley, Esq., at Allen Matkins Leck Gamble & Mallory LLP, represent the Debtors in their chapter 11 cases. When the Debtors filed for protection from their creditors, they listed $23,983,112 in total assets and $12,214,304 in total debts. MILLENNIUM BIOTECH: Has $4.5 Million Equity Deficit at June 30 -------------------------------------------------------------- Millennium Biotechnologies Group, Inc., filed its second quarter financial statements for the three months ended June 30, 2006, with the Securities and Exchange Commission. The Company reported a $4,011,701 net loss on $200,898 of net revenues for the three months ended March 31, 2006, compared to a $1,053,937 net loss on $159,169 of revenues for the three months ended March 31, 2005. At March 31, 2006, the Company's balance sheet showed $1.2 million in total assets and $5.7 million in total liabilities, resulting in a $4.5 million stockholders' deficit. The Company's June 30 balance sheet also showed strained liquidity with $1.1 million in total current assets available to pay $5.6 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?1259 Going Concern Doubt Bagell, Josephs & Company, LLC, in Gibbsboro, New Jersey, raised substantial doubt about Millennium Biotechnologies Group, Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the years ended Dec. 31, 2005, and 2004. The auditor pointed to the Company's operating loses and accumulated deficit. Millennium Biotechnologies Group, Inc., fka Regent Group, Inc., operates through its subsidiary Millennium Biotechnologies, Inc., sells nutraceutical supplements, RESURGEX SELECT(TM), RESURGEX(R), and RESURGEX PLUS(R). These products are used by immuno- compromised individuals undergoing medical treatment for chronic debilitating diseases like cancer, Acquired Immune Deficiency Syndrome, and hepatitis, as well as healthy people searching for proper nutrition. MULTIPLAN INC: Extends Partnership with Health Net -------------------------------------------------- Health Net, Inc., has selected MultiPlan, Inc., to provide a comprehensive Electronic Data Interchange-based service called "Single Dynamic Point of Transfer," or SDPOT, for managing the routing of medical claims to and from its leased networks and various cost management vendors. "Health Net's concept is an ideal showcase for our triple competencies of network, negotiation and technology," said Warren Handelman, MultiPlan's executive vice president of marketing. "Today over 90% of the claims we receive each year are submitted via EDI, and fully 80% of these are routed to and from other cost management strategies, if needed, after network re-pricing has been attempted." On an annual basis, MultiPlan receives more than 37 million claims totaling more than $30 billion in original billed charges for re- pricing through The MultiPlan Network. In addition to its network of over 500,000 directly-contracted healthcare providers, MultiPlan offers its clients a fee negotiation service that delivers unit cost reductions on claims not covered by the network. The services are integrated, so that a claim not re-priced through the network can be immediately routed to the negotiation team if eligible. This removes at least a day from the process of routing claims to and from separate negotiation and network vendors. About MultiPlan MultiPlan Inc. -- http://www.multiplan.com/-- serves as a single gateway to a host of primary, complementary and out-of-network strategies for managing the financial risks associated with healthcare claims. Clients include large and mid-sized insurers, third-party administrators, self-funded plans, HMOs and other entities that pay claims on behalf of health plans. * * * As reported in the Troubled Company Reporter on Sept. 26, 2006, Moody's Investors Service assigned a B2 rating to the proposed $360 million add-on Senior Secured Term Loan of MultiPlan, Inc. Moody's also affirmed the B2 Corporate Family Rating, the B2 rating on the existing senior secured facility and the Caa1 rating on the company's senior subordinated notes. As reported in the Troubled Company Reporter on Sept. 25, 2006, Standard & Poor's Ratings Services affirmed its 'B+' counterparty credit rating on MultiPlan, Inc., and removed it from CreditWatch with negative implications, where it was placed on Aug. 31, 2006. Standard & Poor's outlook on MultiPlan is negative. At the same time, Standard & Poor's assigned its 'B+' rating to MultiPlan's proposed 6.5-year, $360 million senior secured bank loan due 2013. MULTIPLAN INC: To Acquire Private Healthcare Systems ---------------------------------------------------- MultiPlan, Inc., will acquire Private Healthcare Systems, Inc., creating the industry's most comprehensive medical cost management provider. The transaction is expected to close early to mid fourth quarter, 2006, subject to satisfaction of closing conditions, including customary regulatory approvals. Financial terms were not disclosed. Established in 1985 as a collaboration of mid-sized commercial insurance companies seeking to develop competitive managed care programs, PHCS maintains the nation's largest proprietary primary PPO network and is the second largest independent care management provider in the country. The company contracts with nearly 450,000 providers and serves over 16 million health plan members. "PHCS joins the MultiPlan family at the right time for our industry," said Mark Tabak, MultiPlan's Chief Executive Officer. "The addition of their national primary PPO network to our comprehensive product line creates an end-to-end solution for controlling rising healthcare costs while maintaining employee choice. Together, we give healthcare providers access to patients from the country's most diverse base of healthcare payers, and in exchange deliver to payers the provider financial arrangements that help them drive more savings from more medical claims." MultiPlan will continue to operate PHCS under the PHCS Network brand, as the national primary PPO network offering of MultiPlan working in concert with MultiPlan's complementary network, specialty transplant network, fee negotiation and claim routing services. Added Joseph Driscoll, PHCS President and CEO, "PHCS and MultiPlan have highly complementary solutions that enable us immediately to enhance the value we offer to our respective clients. MultiPlan gives our clients access to additional services and technology, and we strengthen MultiPlan's position with medium and small payers that lease-rather than own-their primary PPO networks." MultiPlan Inc. -- http://www.multiplan.com/-- serves as a single gateway to a host of primary, complementary and out-of-network strategies for managing the financial risks associated with healthcare claims. Clients include large and mid-sized insurers, third-party administrators, self-funded plans, HMOs and other entities that pay claims on behalf of health plans. * * * As reported in the Troubled Company Reporter on Sept. 26, 2006, Moody's Investors Service assigned a B2 rating to the proposed $360 million add-on Senior Secured Term Loan of MultiPlan, Inc. Moody's also affirmed the B2 Corporate Family Rating, the B2 rating on the existing senior secured facility and the Caa1 rating on the company's senior subordinated notes. As reported in the Troubled Company Reporter on Sept. 25, 2006, Standard & Poor's Ratings Services affirmed its 'B+' counterparty credit rating on MultiPlan, Inc., and removed it from CreditWatch with negative implications, where it was placed on Aug. 31, 2006. Standard & Poor's outlook on MultiPlan is negative. At the same time, Standard & Poor's assigned its 'B+' rating to MultiPlan's proposed 6.5-year, $360 million senior secured bank loan due 2013. NATIONSTAR HOME: Moody's Assigns Low-B Ratings on Two Sub. Certs. ----------------------------------------------------------------- Moody's Investors Service assigned an Aaa rating to the senior certificates issued by Nationstar Home Equity Loan Trust 2006-B and ratings ranging from Aa1 to Ba2 to the subordinate certificates in the deal. The securitization is backed by Nationstar Mortgage originated adjustable-rate (56%) and fixed-rate (44%) subprime mortgage loans. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination, excess spread, overcollateralization, and an interest rate swap agreement. Moody's expects collateral losses to range from 5.45% to 5.95%. Nationstar Mortgage LLC, will service the loans. Issuer: Nationstar Home Equity Loan Trust 2006-B Cl. AV-1, Assigned Aaa Cl. AV-2, Assigned Aaa Cl. AV-3, Assigned Aaa Cl. AV-4, Assigned Aaa Cl. M-1, Assigned Aa1 Cl. M-2, Assigned Aa2 Cl. M-3, Assigned Aa3 Cl. M-4, Assigned A1 Cl. M-5, Assigned A2 Cl. M-6, Assigned A3 Cl. M-7, Assigned Baa1 Cl. M-8, Assigned Baa2 Cl. M-9, Assigned Baa3 Cl. M-10, Assigned Ba1 Cl. M-11, Assigned Ba2 NAPIER ENVIRONMENTAL: Collects $410,769 from Warrants Excercise --------------------------------------------------------------- Napier Environmental Technologies Inc. issued 41,076,850 common shares to 6408788 Canada Corp. upon exercise of previously issued warrants. Subsequent to this exercise, there are a total of 88,844,892 common shares issued and outstanding, approximately 46% of which are held by 6408788 Canada Corp. The exercise of these warrants results in proceeds to Napier of $410,769. Napier will use the proceeds to partially repay its lenders, 6408788 Canada Corp. and 6408753 Canada Corporation. About Napier Environmental Headquartered in Delta, British Columbia, Napier Environmental Technologies, Inc. (TSX:NIR) -- http://wwwbiowash.com/-- is a Canadian company primarily engaged in the development, manufacture and distribution of a wide range of products utilizing environmentally advanced technology. The product lines include coating removal and wood restoration products for both the industrial/commercial market and the consumer/retail market. Napier is currently operating under the protection of the Canadian Bankruptcy and Insolvency Act. NORTHWEST AIRLINES: Hires L.E.K. Consulting as Industry Advisor --------------------------------------------------------------- Northwest Airlines, Inc., and its debtor-affiliates obtained authority from the United States Bankruptcy Court for the Southern District of New York to employ L.E.K. Consulting LLC as airline industry advisors, pursuant to an Engagement Letter dated June 28, 2006. As reported Troubled Company Reporter on Aug.9, 2006, the Debtors selected LEK because of its experience and expertise in the airline industry. LEK has considerable experience providing similar consulting services to large, complex business entities and companies operating as debtors-in-possession under Chapter 11 of the Bankruptcy Code, Michael L. Miller, Northwest Airlines' vice president, said. As the Debtors' airline industry advisors, LEK is expected to: -- review domestic and international strategic goals; and -- assess ways for Northwest to improve its competitive position and gain access to attractive markets. Mr. Miller explained that the LEK's services are not duplicative of services being rendered by other professionals, including Seabury Group, LLC. "LEK's work is focused on broad strategic issues in the airline industry and is not related to aircraft financing, the Debtors' finances or other day-to-day restructuring work being performed by the Seabury Group, LLC and other retained professionals." LEK will charge the Debtors for professional fees at $77,000 per week or $924,000 total for the 12-week duration required. Any professional time incurred beyond the base team will either be billed on a per diem basis or negotiated as projects needs evolve. The LEK will also charge the Debtors for direct out-of-pocket expenses and variable costs. The Debtors agree to indemnify and hold harmless LEK, together with its affiliates and their members, managers, officers, directors, partners, employees and agents, from any claims, liabilities, losses and damages related or rising from this engagement, unless the claims, liabilities, losses, or damages are finally judicially determined to have been the result of LEK's bad faith or gross negligence. Dan McKone, LEK's vice president, attests that the firm is disinterested as that term is defined pursuant to Section 101(14) of the Bankruptcy Code. 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 Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) NORTHWEST AIRLINES: SVP Blames Interest Payment Delays to JPMorgan ------------------------------------------------------------------ Northwest Airlines, Inc.'s senior vice president and treasurer, Daniel B. Mathews, relates that on November 22, 2005, Northwest was fully prepared and was planning to make the $24,495,000 interest due under the Northwest Airlines, Inc., and its debtor- affiliates' prepetition credit agreement dated April 15, 2005, with JPMorgan Chase Bank, N.A., as administrative agent, but the agent's legal counsel advised Northwest's legal counsel not to send the interest payment. Mr. Mathews recounts that JPMorgan's counsel had said that JPMorgan would refuse to accept a current interest only payment before issues relating to adequate protection were resolved. Due to the JPMorgan's position, payment to the various lenders under the Credit Agreement was delayed for a full month. Northwest was not permitted to make payment until the stipulation granting adequate protection to the Prepetition Lenders was entered into on December 23, 2005, Mr. Mathews says. Accordingly, Mr. Matthews asserts that Northwest never caused a "payment default" and had fully intended to pay the Lenders' current interest on the due date. Mr. Matthews maintains that there should be no default interest, interest on interest or penalties as a result of the delayed payment of the $24,495,000 interest. JPMorgan Responds to Mr. Matthews' Claims On behalf of JPMorgan, Harold S. Novikoff, Esq., at Wachtell, Lipton, Rosen & Katz, in New York, argues that Mr. Matthews' statement falsely asserts, based on at least double-hearsay, that JPMorgan prevented Northwest from making the interest payment due on November 22. According to Mr. William T. Strout, JPMorgan's managing director, his bank only refused Northwest's request that the Prepetition Lenders waive their substantive rights to additional amounts due and payable to them under the Prepetition Credit Agreement. Mr. Strout attests that: -- it was Northwest that caused the interest payment due on November 22 not to be paid on time; -- at no time did JPMorgan or the Prepetition Lenders ever request that Northwest defer payment of the November 22 interest payment; and -- JPMorgan, the Prepetition Lenders or their counsel have no ability to block Northwest from making those interest payment. Mr. Strout relates that JPMorgan worked in good faith with Northwest to arrive at the Adequate Protection Stipulation, which was approved by the U.S. Bankruptcy Court for the Southern District of New York on December 23, 2005. Until then, Northwest had never obtained authorization to make any payments on the prepetition indebtedness owing to JPMorgan and the Prepetition Lenders. The Court-approved Stipulation provided that the Prepetition Lenders' rights to assert their contractual entitlements to the additional amounts -- which Northwest had asked the Prepetition Lenders to waive as a condition to Northwest's making the November 22, 2005 interest payment -- were expressly preserved. Creditors Committee Supports Debtors Representing the Official Committee of Unsecured Creditors, Scott L. Hazan, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., in New York, argues that JPMorgan and the Prepetition Lenders are not entitled to the prepayment penalty because the Debtors' repayment of its obligations under the Prepetition Credit Agreement was neither voluntary nor a prepayment. Under the Credit Agreement, the Debtors defaulted and the obligations were automatically accelerated and became fully due and payable as the result of the Debtors' Chapter 11 commencement. Mr. Hazan contends that as a matter of contract law and fact, the Prepetition Lenders are not entitled to the Penalty Interest because that payment would not compensate them for any actual loss, thus, would be punitive to the Debtors' estates. Mr. Hazan adds that the Prepetition Lenders are also not entitled to the payment of the Disputed Amounts under the Credit Agreement or applicable law. He says that it would be highly inequitable to permit that payment, in the aggregate amount of over $57,500,000, when, among others: -- the Debtors are struggling for their very survival; -- the Debtors' pension plans have been frozen; and -- the Debtors have had to renegotiate or reject their labor agreements to achieve approximately $1,400,000,000 in labor savings. Under Section 506(b) of the Bankruptcy Code, the equities weigh heavily against the payment of the Disputed Amounts, Mr. Hazan asserts. While the Prepetition Lenders may argue that $57,500,000 will not make a meaningful impact on distributions to the general unsecured creditors, it is certainly not an insignificant amount to the insolvent Debtors' ability to reorganize or to the general unsecured creditors, Mr. Hazan maintains. Mr. Hazan contends that the mere fact that the Debtors have the right under the Bankruptcy Code to de-accelerate the Obligations does not mean acceleration has not occurred. Under the Credit Agreement, acceleration was automatic on the Petition Date, after which time there is no right of the Prepetition Lenders to the Prepayment Penalty. The Prepetition Lenders should not be permitted payment of more than they would have received had the Obligations been de- accelerated under Section 1124(2), Mr. Lazan tells the Court. He insists that, as the Prepetition Lenders have already received payments of all they would be entitled under Section 1124(2), their request for payment of the Disputed Amounts should be denied. JPMorgan Wants All Disputed Amounts Paid Harold S. Novikoff, Esq., at Wachtell, Lipton, Rosen & Katz, in New York, contests the Debtors' assertions that JPMorgan's "demands" for a prepayment fee, on the one hand, and ABR and default interest, on the other, are "fundamentally at odds with each other." According to Mr. Novikoff, there is nothing inconsistent about JPMorgan's positions because all of the Disputed Amounts are payable to Prepetition Lenders under the Prepetition Credit Agreement. The Debtors have offered no legal or factual basis to disregard any of the Lenders' contractual rights, he asserts. Mr. Novikoff argues that there can be no doubt that the Debtors made a "voluntary prepayment" because they repaid the Loans: -- years before their scheduled maturities, -- before a Chapter 11 plan was filed in the Debtors' cases, and -- absent any request, demand or pressure from JPMorgan or the Prepetition Lenders. Mr. Novikoff notes that the Prepetition Lenders had neither the incentive nor the legal basis to compel the DIP Financing, and never took the slightest step in that direction. The Debtors, on the other hand, had every incentive to prepay the Loans, because the interest savings they could achieve at the Prepetition Lenders' expense were far greater than the Prepetition Credit Agreement's prepayment fee. Having taken advantage of that under-compensatory prepayment fee, the Debtors have no legal basis to claim that it is not reasonable, he asserts. In addition, JPMorgan is not convinced that the Eurodollar/ABR Increment should be disallowed. Mr. Novikoff points out that the Prepetition Credit Agreement makes clear that the Debtors may not select an Interest Period that extends beyond the "anticipated final maturity date" of a Loan. The Debtors' claim that this limitation applies only to the Loans' original scheduled maturity dates is incompatible with the Credit Agreement, he contends. The Debtors' claim also clashes with Section 3.3(b) of the Prepetition Credit Agreement, which provides that an Interest Period may not extend beyond a Loan's "anticipated final maturity date" as of the time when that Interest Period begins, not as of the time when the Loans were originally mad, when their maturities were years in the future, Mr. Novikoff argues. In any event, Mr. Novikoff asserts, JPMorgan validly determined that the Debtors were not entitled to make further Eurodollar elections as of November 22, 2005. Although the Debtors make the conclusory assertions that this determination violated the automatic stay, ran afoul of Sections 365(c) and 541(c) of the Bankruptcy Code, and was a disguised attempt to collect default interest, they do not cite a single case in support of any of those assertions. None of the Debtors' assertions has any legal support, he maintains. According to Mr. Novikoff, the Debtors simply misstate the law in attempting to avoid the contractually required payment of default interest: * The Debtors claim that JPMorgan has the burden to prove that the contract default rate should be allowed, even though courts in this jurisdiction uniformly apply a presumption in favor of that contract rate; and * The Debtors pronounce that "there exists not a single published decision" in which contract default interest has been enforced against an insolvent debtor. Mr. Novikoff argues that all relevant authorities, including a recent decision of the Court of Appeals for the Sixth Circuit, agree that default interest in insolvent cases should be evaluated on a case-by-case basis. Mr. Novikoff maintains that the Prepetition Lenders have incurred substantial damages while the Debtors have been in default. Accordingly, JPMorgan asserts that default interest should be allowed on all overdue amounts. Debtors React Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP, in Washington, DC, maintains that the Debtors do not owe any prepayment fee to JPMorgan and the Prepetition Lenders. The Credit Agreement provides that the fee payable on "voluntary" prepayment would not apply after automatic acceleration of the debt, Mr. Ellenberg emphasizes. Furthermore, New York law and other jurisdiction provide that in construing prepayment fee clauses, acceleration presumptively precludes applicability of the fee. The Prepetition Lenders' decisions to revoke the Eurodollar election option, to demand default interest, Eurodollar/ABR Interest and a prepayment fee, and to condition continued use of the collateral on an adequate protection order represent coercive acts, Mr. Ellenberg contends. The Prepetition Lenders evidenced their intention to exercise remedies when JPMorgan refused to accept Northwest Airlines' November 22, 2005 payment unless and until an adequate protection to the Lenders was fully negotiated. The Debtors accede the Prepetition Credit Agreement obligated Northwest to indemnify the Prepetition Lenders if they suffered actual damages in connection with the funding of Eurodollar loans. The Prepetition Lenders, however, were not injured and have not claimed indemnification, Mr. Ellenberg points out. The Prepetition Lenders fail to identify a single concrete cost attributable to Northwest's default that is not being paid by Northwest, Mr. Ellenberg adds. The Lenders also fail to identify a case where default interest was allowed against an insolvent debtor. Mr. Ellenberg further argues that the Prepetition Lenders misread the Prepetition Credit Agreement when they asserted that the Adequate Protection Stipulation provisions, permitting Northwest to continue making Eurodollar elections, manifests Northwest's concession that the loans had not matured. The Prepetition Credit Agreement permits elections up to the "final anticipated maturity date," Mr. Ellenberg explains. In addition, the contract right to make the Eurodollar election is property of the estate. Thus, Northwest's insistence on the continued right to make Eurodollar elections in no way conflicts with the fact that the loans have been accelerated. Mr. Ellenberg clarifies that the purpose of the Adequate Protection Stipulation was to preserve rights, claims and defenses, and not to waive them. The Stipulation simply established a mechanism for release of liens upon repayment, including segregation of funds in a separate account to the extent that any payoff amounts were disputed. It is precisely because of the reservation of rights that amounts would be in dispute and a reserve would be needed, he avers. Furthermore, the Prepetition Lenders fail to demonstrate that the prepayment fee is allowable under Section 506(b), Mr. Ellenberg argues. The Credit Agreement prescribes a flat, automatic fee that declines from 3% in the first year to 1% in the third year, and then disappears. The fee is not related in any way to interest rate movements, Mr. Ellenberg emphasizes. The Prepetition Lenders complain that the default rate in the Credit Agreement is low, but never explain what the additional interest is compensating them for, Mr. Ellenberg points out. In fact, it is compensating them for nothing and is purely a penalty, Mr. Ellenberg asserts. Moreover, no court has allowed default interest claims under Section 506(b) where the debtor was insolvent and unsecured creditors would, in effect, be paying the increased costs. There exists no real dispute over interest on interest, Mr. Ellenberg says. The only interest on interest due relates to the default interest, Eurodollar/ABR interest and the prepayment fee not being made. If the Court were to award any of the items to the Prepetition Lenders, Northwest agrees that it is contractually obligated to pay interest on the unpaid interest. However, that additional cost only emphasizes the penalty nature of the items. Moreover, Mr. Ellenberg argues, Northwest is not obligated to pay the fees of L.E.K. Consulting, Inc., who appraised collateral for the Prepetition Lenders in connection with a "potential" motion for adequate protection, because the appraiser fees are unnecessary and are not encompassed by the Credit Agreement. JPMorgan had sufficient expertise to appraise the collateral on its own, and the "potential" motion was never filed, and never needed to be filed, Mr. Ellenberg avers. Accordingly, the Debtors ask the Court to determine that the Prepetition Lenders have already been paid in full and are not entitled to any further payments. 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 Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) OWENS CORNING: Bankruptcy Court Approves Plan of Reorganization --------------------------------------------------------------- The Hon. Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware approved the Owens Corning Plan of Reorganization on Sept. 26, 2006. The Bankruptcy Court's approval of the plan paves the way for Owens Corning to emerge from bankruptcy by the end of October 2006. "The court's approval of Owens Corning's Plan of Reorganization is a significant accomplishment for our company," said Dave Brown, president and chief executive officer. "As a direct result of the hard work of our employees and the continued support of our customers, suppliers and business partners, Owens Corning has the strong business performance and financial resources necessary to make this plan possible. We are pleased to have court approval on a plan that deals fairly and equitably with all our creditors and permanently resolves our asbestos liability. "Throughout the Chapter 11 process, Owens Corning has remained committed to fairly compensating individuals who were made sick by exposure to asbestos-containing products that we produced until 1972," said Mr. Brown. "This plan allows us to achieve that objective through the funding of a Trust that will allow those affected by asbestos to be compensated in the near future." Owens Corning's creditors and shareholders overwhelmingly supported the plan, including the asbestos, bondholder, and trade creditor classes, and bank debt holders. Before Owens Corning can emerge from bankruptcy, the plan must also be approved by Judge John P. Fullam of the U.S. District Court for the Eastern District of Pennsylvania. Following district court approval of the plan, Owens Corning must complete certain administrative steps before it can emerge from Chapter 11. "We will emerge as a strong company," said Mr. Brown. "Since 2002, we have strengthened our financial performance, including increased sales, improved income from operations and reduced SG&A. These financial achievements are reflected in the preliminary investment-grade credit ratings that we received from both Standard&Poor's and Moody's, an unprecedented accomplishment for a company emerging from a bankruptcy restructuring." The agreement assumes a total distributable value of approximately $8.627 billion, consisting of the total enterprise value of $5.858 billion, assumed excess cash of $1.432 billion, and Fibreboard trust and asbestos trust assets of $1.491 billion, less existing debt of $55 million and $99 million in assumed value of new shares reserved for employee incentive programs. Key Terms of the Plan of Reorganization is available for free at: http://www.ocplan.com/ocplan_chapter11.htm Owens Corning's exit financing will come from a combination of new equity, new debt financing and existing debt at non-debtor Owens Corning entities. The company will begin distributions to creditors upon the effective date of its emergence from Chapter 11. About Owens Corning Owens Corning (OTC: OWENQ.OB) -- http://www.owenscorning.com/-- manufactures fiberglass insulation, roofing materials, vinyl windows and siding, patio doors, rain gutters and downspouts. Headquartered in Toledo, Ohio, the Company filed for chapter 11 protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837). Norman L. Pernick, Esq., at Saul Ewing LLP, represents the Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Official Committee of Asbestos Creditors. James J. McMonagle serves as the Legal Representative for Future Claimants and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP. PLY GEM: Alcoa Merger Cues S&P to Put Ratings on Negative Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings, including its 'B+' corporate credit rating, on Kearney, Missouri-based siding and window manufacturer Ply Gem Industries Inc. on CreditWatch with negative implications. The rating action followed the company's announcement that it has entered into a definitive agreement to acquire Alcoa Home Exteriors Inc., a manufacturer of vinyl and aluminum siding and accessories, from Alcoa Inc. (A-/Negative/A-2) for a purchase price of about $305 million. "Although the acquisition should somewhat improve Ply Gem's business risk profile, we are concerned that an additional debt- financed acquisition, especially at this point in the housing cycle, may prevent Ply Gem from attaining the credit metrics appropriate for the current ratings," said Standard & Poor's credit analyst Lisa Wright. Ply Gem's financial risk profile prior to the acquisition was already below Standard & Poor's expectations, with total debt (including capitalized operating leases) to EBITDA of about 5.7x for the 12 months ended July 1, 2006. To resolve the CreditWatch, Standard & Poor's will assess the company's business strategy, financial policies, financing plans, and our expectations for its financial performance over the intermediate term. PINNACLE FOODS: Moody's Assigns Loss-Given-Default Ratings ---------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its B1 Corporate Family Rating for Pinnacle Foods Group Inc. Additionally, Moody's revised or confirmed its probability-of- default ratings and assigned loss-given-default ratings on these loans facilities and notes: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2009 B1 Ba3 LGD3 33% Sr. Sec. Term Loan B Due 2010 B1 Ba3 LGD3 33% Sr. Sec. Term Loan B Due 2010 B1 Ba3 LGD3 33% Sr. Sub. Notes Due 2013 B3 B3 LGD5 85% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Pinnacle Foods Group Inc. -- http://www.pinnaclefoodscorp.com/-- with corporate offices in Mountain Lakes and Cherry Hill, New Jersey produces, markets, and distributes high-quality branded food products in the frozen foods and dry foods segments. The dry foods segment consists primarily of Duncan Hines(R) baking mixes and frostings; Vlasic(R) pickles, peppers and relish; Armour(R) canned meats; Open Pit(R) barbeque sauce and Mrs. Butterworth's(R) and Log Cabin(R) syrups and pancake mixes. The frozen foods segment consists primarily of Aunt Jemima(R) frozen breakfasts; Swanson(R) and Hungry Man(R) frozen dinners and entrees; Van de Kamp's(R) and Mrs. Paul's(R) frozen seafood; Celeste(R) pizza; and Lender's(R) bagels. POLY-TECH RADIANT: Files for Relief Under Canadian Bankruptcy Act ----------------------------------------------------------------- Poly-Tech Radiant Inc., a subsidiary of Cie-Nergy Ply-foil Canada Inc., filed for protection under Canada's Companies' Creditors Arrangement Act on Sept. 19, 2006, in order to facilitate its financial restructuring. Cie-Nergy owns 75% of the issued and outstanding shares in the capital of Poly-Tech. The CCAA process will allow Poly-Tech to restructure its balance sheet and costs to complete its transformation into a leaner, more efficient, lower manufacturer. Under the CCAA process, Poly-Tech is required to submit a formal proposal to its creditors by Oct. 6, 2006. The creditors will then have to approve the proposal within 21 days after submission. If the proposal is approved, Poly-Tech will emerge from CCAA protection. During the CCAA process, Poly-Tech will continue its operations in the normal course and Cie-Nergy will continue its relationship with Poly-Tech. The CCAA process will not affect the business of Cie-Nergy. In addition, Cie-Nergy is also currently negotiating with various manufacturers to ensure that its business will not be affected. Poly-Tech Radiant Inc., a subsidiary of Cie-Nergy Ply-foil Canada Inc., manufactures bubble foil insulations. Headquartered in Quebec, Canada, Cie-Nergy (TSX-V:CGY) -- http://www.cie-nergy.com/ -- is engaged in the manufacturing and marketing of specialty reflective insulating products and specializes in building products designed to cut down on energy costs. The Company markets its products in North America and Europe under the Thermo Foil(TM), Ayr Foil(TM) and Air Thermo Foil(TM) brand names. POLYMER GROUP: Moody's Assigns Loss-Given-Default Ratings --------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B2 Corporate Family Rating for Polymer Group, Inc. Additionally, Moody's held its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $45 million Sr. Secured Revolver due 2010 B1 B1 LGD3 33% $410 million Sr. Secured Term Loan B due 2012 B1 B1 LGD3 33% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Charlotte, North Carolina, Polymer Group, Inc. -- http://www.polymergroupinc.com/-- is a global, technology-driven developer, manufacturer and marketer of engineered materials. POLYONE CORPORATION: Fitch Lifts Sr. Unsecured Debts' Rating to B+ ------------------------------------------------------------------ Fitch Ratings affirmed PolyOne Corporation's issuer default rating at 'B'; upgraded the rating on the senior unsecured debt; and withdrawn the rating on the senior secured credit facility. The Rating Outlook is Stable. The ratings are: -- Issuer default rating 'B' -- Senior secured credit facility 'BB/RR1' withdrawn -- Senior unsecured notes and debentures: upgraded to 'B+/RR3' from 'B/RR4' The ratings continue to reflect PolyOne's: * downstream position as a leading plastics compounder and North American distributor; * low operating margins; * high debt level; and * cyclical earnings. PolyOne's operating performance continued to improve in 2005 and through the first half of 2006. In the current environment, raw material resin pricing has stabilized at high levels and PolyOne has been able to catch up with its own price increases, supported by good demand. Distributions from equity affiliates continue to be an important source of cash flow for the company. For the latest 12 months period ended June 30, 2006, PolyOne's operating EBITDA improved to $158 million from $119 million at year-end 2005. Operating EBITDA margin has also improved to 6.0% from 4.9% at year-end 2005, but remains in the single-digit range. Meanwhile, total debt (including A/R securitization) declined to $628 million from $654 million at the end of 2005. Higher earnings and lower debt have strengthened credit statistics with total adjusted debt/operating EBITDAR of 4.4x and operating EBITDA/gross interest expense of 2.1x. These credit statistics compare favorably to leverage of 5.9x and coverage of 1.5x at year-end 2005. The withdrawal of the $30 million senior secured credit facility rating stems from the expiration of that facility with no replacement. The upgrade of the senior unsecured debt rating to 'B+/RR3' reflects an increase in principal recovery related to the expiration of the senior secured credit facility. The Stable Rating Outlook incorporates some additional improvement in earnings and profitability with modest, if any, debt reduction over the next 12 months. The Stable Outlook assumes: * demand is stable; * any necessary price increases can be passed through; and * costs moderate slightly. Other than the medium-term notes maturing each year, Fitch does not anticipate significant debt reduction in the near term. PolyOne has stated its desire to retire the 2010 notes on their call date in May 2007. PolyOne, headquartered in Avon Lake, Ohio, is the largest compounder of plastics and a leading distributor of plastic resins in North America. PolyOne had revenues of approximately $2.7 billion and operating EBITDA of $157.7 million for the LTM period ended June 30, 2006. PUMPWORKS INC: Involuntary Chapter 11 Case Summary -------------------------------------------------- Alleged Debtor: Pumpworks, Inc. 2277 49th Avenue North Minneapolis, MN 55430 Involuntary Petition Date: September 26, 2006 Case Number: 06-42109 Chapter: 11 Court: District of Minnesota (Minneapolis) Judge: Robert J. Kressel Petitioners' Counsel: Kenneth Corey-Edstrom, Esq. Larkin Hoffman Daly and Lingren Ltd. 1500 Wells Fargo Plaza 7900 Xerxes Ave. S Bloomington, MN 55431 Tel: (952) 835-3800 Fax: (952) 896-333 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Leigh's Company Subordinated $91,000 6434 Logan Avenue South Debenture Holder Minneapolis, MN 55423 Lee Jackson Subordinated $60,000 6434 Logan Avenue South Debenture Holder Minneapolis, MN 55423 Wayne Gysland Subordinated $47,500 4138 Blueberry Knoll Debenture Holder Eagan, MN 55123 PURE FISHING: Weak Financial Results Cue S&P's Rating Downgrade --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and bank loan ratings on fishing tackle manufacturer Pure Fishing Inc., including PFI's corporate credit rating, which was lowered to 'B' from 'B+'. At the same time, the recovery rating on the first-lien senior secured credit facility was raised to '3' from '4', indicating that first-lien lenders could expect meaningful recovery of principal (50% to 80%) in the event of a payment default. The second-lien bank loan recovery rating of '5' remained unchanged, indicating the rating agency's expectation that second- lien lenders can expect negligible recovery of principal in the event of a payment default (0%-25%). The outlook was revised to stable from negative. "The corporate credit and bank loan rating downgrades reflect weaker-than-expected financial results and the expectation that financial performance will remain soft for the remainder of 2006," said Standard & Poor's credit analyst Mark Salierno. The raised recovery rating on the first-lien bank facility reflects modest debt repayment in first-lien term loan debt (about $10 million over the past two years) and the rating agency's revised assumption for a less precipitous decline in EBITDA under Standard & Poor's default scenario, which now considers a shorter timeline to default. Total debt outstanding at PFI as of June 30, 2006, was approximately $191 million, excluding operating leases. The ratings on Spirit Lake, Iowa-based PFI reflect the company's narrow business focus, participation in the highly competitive fishing tackle industry, customer concentration, and leveraged financial profile. RADNOR HOLDINGS: U.S. Trustee Wants Chapter 11 Trustee Appointed ---------------------------------------------------------------- Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, asks the U.S. Bankruptcy Court for the District of Delaware to appoint a chapter 11 trustee in Radnor Holdings Corporation and its debtor- affiliates' bankruptcy proceedings or in the alternative, appoint an examiner. The Trustee relates that at the hearing held on Sep. 14, 2006, it was revealed that the Debtors' Chief Financial Officer has been replaced because he altered evidence, in particular, two electronic mails. The First Day Affidavit in the Debtors' chapter 11 cases was prepared and signed by the CFO. The Trustee tells the Court that since the CFO is responsible for the financial documents that parties in interest in this case must rely upon, the public documents submitted by the Debtors and others have raised serious concerns not only about the accuracy of the information available to the public, but also about the management of the Debtors and the connections among the lender, the Debtors, and the proposed bankruptcy professionals. The Trustee contends these concerns, when considered together with the expedited sale of the Debtors' assets, are cause enough to appoint a chapter 11 trustee. The Trustee further contends that the Debtors have requested an extension of the time to file their schedules of assets and debts and statements of financial affairs until after the date set for the first meeting of creditors. If granted, this means that schedules and statements of affairs will not be filed in time for parties-in-interest to complete a meaningful review before the contemplated sale. The Trustee tells the Court that she wants a chapter 11 trustee appointed to investigate: (1) the accuracy of the financial information in the first day affidavit and the financial information provided to the public by the Debtors; (2) whether any material information of the Debtors was altered or destroyed; (3) any material discrepancies in the reporting of the Debtor's inventory; (4) the transfers, including compensation and benefits, to insiders and to non-debtor related entities; (5) the proposed sale by the Debtor of its assets to Tennenbaum Capital Partners, LLC or to an affiliate thereof and the circumstances surrounding the Sale to determine the propriety of the Sale and whether any causes of action exist which may be pursued by the Debtor or other parties in interest with respect to the Sale; and (6) the control exerted by Tennenbaum Capital Partners, LLC or any person controlled by TCP over the Debtors prior to the Debtors' bankruptcy filing to determine the propriety of such control and whether any causes of action exist which may be pursued by the Debtor or other parties in interest with respect to the same. Headquartered in Radnor, Pennsylvania, Radnor Holdings Corporation -- http://www.radnorholdings.com/-- manufactures and distributes a broad line of disposable food service products in the United States, and specialty chemicals worldwide. The Debtor and its affiliates filed for chapter 11 protection on Aug. 21, 2006 (Bankr. D. Del. Case No. 06-10894). Gregg M. Galardi, Esq., and Mark L. Desgrosseilliers, Esq., at Skadden, Arps, Slate, Meagher, represent the Debtors. The Official Committee of Unsecured Creditors is represented by Greenberg Traurig, LLP. When the Debtors filed for protection from their creditors, they listed total assets of $361,454,000 and total debts of $325,300,000. RAPID LINK: Primary Debt Holders Extend Maturity to November 1 -------------------------------------------------------------- Rapid Link, Inc., reported the extension and revision of all Convertible Debenture Notes drawn in the favor of GCA Strategic Investment Fund Limited, a Bermuda Corporation and Global Capital Funding Group, L.P., a Delaware limited partnership. Highlights of the Amended Notes: -- Both convertible debentures held by GCASIF have had their maturity dates extended to Nov. 1, 2007. -- All conversions of the debentures to common stock now have a $0.10 conversion floor and a $0.25 conversion ceiling in place for the duration of the notes. "These amendments, agreed to and implemented by Rapid Link and our primary debt holders, are truly an expression of support and cooperation by GCASIF and GCFG in Rapid Link, our management, and our current course of business. GCASIF and GCFG are aware of the tremendous strides Rapid Link has recently made in its business as detailed in the recent 10Q filed Sept. 14, 2006, and their support in amending our agreements is an encouraging sign for our investors," stated John Jenkins, CEO of Rapid Link. About Rapid Link Headquartered in Los Angeles, California, Rapid Link, Inc. -- http://www.rapidlink.com/-- provides Voice over Internet Protocol communication services, including fax, data, and other Web-based services. The company offers PC-to-PC, PC-to-phone, phone-to- phone calling on their unique set of Internet Access Devices that provide a new low cost phone service that is delivered through a broadband connection. Going Concern Doubt KBA Group LLP, in Dallas, Texas, raised substantial doubt about Rapid Link's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Oct. 31, 2005. The auditor pointed to the Company's shareholders' deficit of $6.3 million, and its recurring losses from continuing operations during each of the last two fiscal years. RC2 CORP: Moody's Assigns Loss-Given-Default Ratings ---------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency revised its Ba2 Corporate Family Rating to Ba3 for RC2 Corporation. Additionally, Moody's confirmed its probability-of-default ratings and assigned loss-given-default ratings on these loans facilities: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2008 Ba2 Ba2 LGD3 32% Sr. Sec. Term Loan Due 2008 Ba2 Ba2 LGD3 32% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). RC2 Corporation -- http://www.rc2corp.com/-- designs, produces and markets innovative, high-quality toys, collectibles, hobby and infant care products that are targeted to consumers of all ages. RC2's infant and preschool products are marketed under its Learning Curve(R) family of brands which includes The First Years(R) by Learning Curve and Lamaze brands as well as popular and classic licensed properties such as Thomas & Friends, Bob the Builder, Winnie the Pooh, John Deere, and Sesame Street. RC2 markets its collectible and hobby products under a portfolio of brands including Johnny Lightning(R), Racing Champions(R), Ertl(R), Ertl Collectibles(R), AMT(R), Press Pass(R), JoyRide(R) and JoyRide Studios(R). RC2 reaches its target consumers through multiple channels of distribution supporting more than 25,000 retail outlets throughout North America, Europe, Australia, and Asia Pacific. REFCO INC: Ch. 11 Trustee Wants Court Nod on Winchester Settlement ------------------------------------------------------------------ Prior to filing for bankruptcy, Refco Capital Markets, Ltd., Winchester Preservation, LLC, and certain individual beneficiaries entered into interrelated agreements, including: (i) loan agreements, notes, and pledge agreements between RCM and each of the Beneficiaries; (ii) a deposit agreement and a pledge agreement between RCM and Winchester; and (iii) pledge agreements among RCM, each of the Beneficiaries, and Christiana Bank & Trust Company. RCM loaned the Beneficiaries certain sums, and Winchester deposited a sum equal to the principal amount of the loan into an account held by RCM. The Loan Documents provide that the deposit will be automatically offset against the loan, upon the Beneficiaries' demand to Winchester for redemption and Winchester's subsequent demand to RCM for withdrawal of the deposit. The offset is subject to the Beneficiaries' payment to RCM of a sum equal to the spread between interest accrued on the loan and interest accrued on the deposit and a break fee. When RCM filed for bankruptcy, the Beneficiaries demanded redemption from Winchester, and Winchester subsequently demanded withdrawal of the deposit from RCM. Winchester and the Beneficiaries commenced an adversary proceeding asserting, among other things, rights of set-off or recoupment concerning the deposit account held by RCM. Each of the Claimants also filed a proof of claim against all of the Debtors. Marc Kirschner, the Chapter 11 trustee overseeing RCM's estate, has determined that Winchester's and the Beneficiaries' right to recoup the deposit against the Loan as provided for in the Loan Documents is valid and likely would be upheld by the Court if the issue were litigated. After vigorous and arm's-length negotiations, the RCM Trustee, Winchester, and the Beneficiaries entered into a settlement agreement. The RCM Trustee asks the U.S. Bankruptcy Court for the Southern District of New York to approve the Settlement Agreement. The terms of the Agreement are: (a) The Claimants' right to recoupment of the deposit against the loan will be honored; (b) The Claimants will pay RCM the interest spread and break fee due under the Loan Documents; (c) The parties will release one another from all claims and causes of action arising from the Loan Documents, except as expressly provided in the Agreement; (d) The Claimants will irrevocably withdraw all proofs of claim against RCM and the other Debtors; (e) All litigation between the parties will be discontinued with prejudice, including the Adversary Proceeding; and (f) The Claimants' objection to the RCM Trustee's settlement agreement with RCM securities customers and general unsecured creditors will be irrevocably withdrawn. Timothy B. DeSieno, Esq., at Bingham McCutchen LLP, in New York, New York, asserts the Agreement will benefit RCM's estate and, in turn, its creditors, by efficiently collecting the net value to RCM of the Loan Documents, rather than eroding that net value by expending fees and costs in a litigation with little or no chance of success. About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. Refco LLC, an affiliate, filed for chapter 7 protection on Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is a regulated commodity futures company that has businesses in the United States, London, Asia and Canada. Refco, LLC, filed for bankruptcy protection in order to consummate the sale of substantially all of its assets to Man Financial Inc., a wholly owned subsidiary of Man Group plc. Albert Togut, the chapter 7 trustee, is represented by Togut, Segal & Segal LLP. On April 13, 2006, the Court appointed Marc S. Kirschner as Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is represented by Bingham McCutchen LLP. RCM is Refco's operating subsidiary based in Bermuda. Three more affiliates of Refco, Westminster-Refco Management LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) REFCO INC: Inks Settlement Accord with BofA & Prepetition Lenders ----------------------------------------------------------------- Refco Inc., and its debtor-affiliates and Marc Kirschner, the Chapter 11 trustee for Refco Capital Markets, Ltd., ask the U.S. Bankruptcy Court for the Southern District of New York to approve a settlement agreement with Bank of America, N.A., and a syndicate of lenders under an August 5, 2004, credit agreement. The Settlement Agreement implements a key component of a global plan being negotiated for the Refco estates, J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York, explains on the Debtors' behalf. The Global Plan, Mr. Milmoe says, would call for pre-confirmation payments to a group of the Debtors' secured lenders. The payments will help ensure the availability of funds to pay other constituencies by: (1) cutting off the interest accruing on the secured lenders' claims in excess of $6,000,000 per month or $200,000 per day; (2) minimizing the incurrence of additional professional fees by the Debtors, the Debtors' secured lenders, the Committees and others, which have already been substantial; and (3) resolving disputes over the use of cash collateral. The specific terms of the Global Plan are currently being negotiated, and a formal agreement has not yet been reached among the various constituencies, Edwin E. Smith, Esq., at Bingham McCutchen LLP, in New York, tells the Court on the RCM Trustee's behalf. The Motion is being filed with the expectation that a formal agreement for a Global Plan will be reached, Mr. Smith says. Refco's Obligations to BofA & Lenders Refco Finance Holding, LLC, entered into the Credit Agreement in connection with an Equity Purchase and Merger Agreement among Refco Group Ltd., LLC; Refco Group Holdings, Inc.; Thomas H. Lee and its affiliates; and certain other parties. The Equity Purchase Agreement required Refco Group to obtain $1,400,000,000 in financing through a term loan and a note issuance. The Equity Purchase Agreement contemplated a series of transactions resulting in: (i) New Refco Group, Ltd., LLC, becoming the parent of Refco Group; (ii) THL and its co-investors acquiring a 56.7% interest in New Refco Group; (iii) Phillip Bennett, CEO of the various Refco Entities, owning a 42.8% interest in New Refco Group; and (iv) Refco management owning the remaining 0.5% of New Refco Group. RFH and Refco Group merged on August 5, 2004, with Refco Group as the surviving entity. The Credit Agreement provided for up to $800,000,000 in term loans and a $75,000,000 revolving credit facility. New Refco Group and certain of Refco Group's affiliates guaranteed Refco Group's obligations under the Credit Agreement. Refco Group and the Guarantors granted BofA, as administrative agent for the Lenders, a security interest in substantially all of Refco Group's and the Guarantors' assets pursuant to a Security Agreement and certain Collateral Documents. RFH and Refco Finance, Inc., also issued $600,000,000 in 9% Senior Subordinated Notes pursuant to a Senior Subordinated Note Indenture dated August 5, 2004, with Wells Fargo Bank, N.A. The Notes were guarantied by Refco Group and certain of Refco Group's affiliates, but the Notes and the guaranties are unsecured and subordinate to the claims arising from the Loan Documents. As of the Petition Date, there was approximately $642,000,000 in principal outstanding under the Credit Agreement exclusive of interest, fees, and other obligations. Interest on the principal is accruing at a rate of more than $6,000,000 per month. BofA has filed proofs of claim against the Debtors based on amounts due under the Loan Documents. BofA also asserted claims based on, among others things, fraud and misrepresentations of the Debtors. BofA said certain of the Debtors were potentially employed in a joint scheme to defraud the Lenders in relation to the Recapitalization. On January 24, 2005, the Refco estates paid $150,000,000 to the Lenders in partial satisfaction of amounts due under the Credit Agreement. BofA transferred the funds to certain of the Lenders. Potential Claims Against BofA & Lenders The Joint Subcommittee of the Official Committees of Unsecured Creditors believes that the Debtors' estates hold potential causes of action to (i) avoid their obligations to the Lenders, and (ii) recover the Repayment as fraudulent conveyances. The Joint Subcommittee, however, acknowledges that resolution of the claims against BofA and the Lenders would be expensive and time-consuming. BofA and Lenders may assert significant defenses like solvency, reasonably equivalent and fair value, lack of grounds for collapsing transactions, lack of causation, inability to avoid settlement payments and the like, Mr. Smith tells Judge Drain. Major Settlement Terms The Debtors and the RCM Trustee filed with the Court a proposed order, which sets out the settlement terms permitting the payment of the Debtors' secured lenders. The Proposed Order, Mr. Smith relates, also provides the means by which the Debtors can avoid contesting and, if unsuccessful, paying claims asserted by BofA and the Lenders based on alleged fraud and misrepresentations as well as contesting or paying claims for indemnification, additional interest, and other amounts claimed under contracts. A full-text copy of the Proposed Order is available at no charge at http://ResearchArchives.com/t/s?124c The Proposed Order provides that BofA and the Lenders' claims under the Loan Documents will be allowed in full as secured claims in the cases of Refco Group and the debtor-Guarantors. The claims will be secured by valid and perfected liens in collateral, which will be worth more than the amount of the secured claims. The secured claims will not be subject to avoidance. On or before the later of October 16, 2006, or a later date that is agreed upon, the Debtors will pay BofA: * $642,000,000, constituting the full outstanding principal amount due under the Loan Documents; * $1,693,276, constituting the full amount of interest accrued and unpaid under the Loan Documents on the Petition Date; * all interest accrued on principal and interest payable under the Loan Documents from the Petition Date through the Payment Date, payable at the Post-Petition Interest Rate and compounded daily from the Petition Date through the Payment Date; * the lesser of $13,500,000 and the fees and expenses that are reimbursable under the Loan Documents through September 30, 2006. The amount is subject to increase upon the occurrence of certain events, such as if the hearing on the Motion is contested or if BofA incurs additional fees as a result of being sued prior to September 30; and * other fees and expenses payable under the Loan Documents incurred from October 1, 2006, through the Payment Date. The Post-Petition Interest Rate is the Base Rate in effect from time to time plus the Applicable Rate applicable to Base Rate Loans, as each term is defined in the Credit Agreement, but without the additional 2% per annum default interest provided in the Credit Agreement. BofA and the Lenders are deemed to consent to their Liens being primed in part by security interests and liens that secure credit obligations incurred by the Debtors for the purpose of funding or refinancing the funding of payments made to BofA pursuant to the Proposed Order if the principal amount of the credit obligation does not exceed $200,000,000. Qualifying Plan The parties participating in the Settlement, including the Debtors and the RCM Trustee, expect to execute a participating party agreement by the September 27, 2006, hearing on the Motion. The parties will agree to: -- use their reasonable best efforts to ensure that a plan confirmed in the Chapter 11 Debtors' cases is a Qualifying Plan; and -- be bound by the terms and conditions of the Proposed Order, whether or not a plan is agreed upon or confirmed. A list of the participating parties is available at no charge at: http://ResearchArchives.com/t/s?124b A Qualifying Plan, among others, implements the terms and conditions of the Proposed Order, including the treatment of and releases provided to BofA and the Lenders. BofA's and the Lenders' claims for indemnification and other amounts due under the Credit Agreement will be estimated at $0 for purposes of allowance in the Debtors' cases. Their unsecured claims, including claims for fraud and misrepresentation, will also be estimated at $0. Cash Collateral Upon payment in full of amounts required to be paid on or before the Payment Date, the Debtors will be authorized to use the Lenders' cash collateral to pay allowed administrative expenses and to make other payments under an effective Qualified Plan or as permitted by the Court without any further consent of or provision of adequate protection to BofA or the Lenders. The Adequate Protection Motion currently before the Court will be postponed to the date of the hearing on confirmation of a plan. BofA and the Lenders will not seek any additional adequate protection. BAWAG Proceeds BofA has asserted, on the Lenders' behalf, a security interest in, among other Refco assets, the cash proceeds of the Debtors' settlement with BAWAG P.S.K. Bank fur Arbeit und Wirtschaft und Osterreichische Postsparkasse Aktiengesellschaft. Mr. Milmoe relates that to the extent that Refco Group or any of the Guarantors ever come into possession of the BAWAG Proceeds, on or prior to the Payment Date, the Debtors may use these proceeds to make the payments required under the Proposed Order. About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. Refco LLC, an affiliate, filed for chapter 7 protection on Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is a regulated commodity futures company that has businesses in the United States, London, Asia and Canada. Refco, LLC, filed for bankruptcy protection in order to consummate the sale of substantially all of its assets to Man Financial Inc., a wholly owned subsidiary of Man Group plc. Albert Togut, the chapter 7 trustee, is represented by Togut, Segal & Segal LLP. On April 13, 2006, the Court appointed Marc S. Kirschner as Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is represented by Bingham McCutchen LLP. RCM is Refco's operating subsidiary based in Bermuda. Three more affiliates of Refco, Westminster-Refco Management LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News, Issue No. 41; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) RESIDENTIAL ASSET: Moody's Cuts Class M-I-3 Notes' Rating to Caa3 ----------------------------------------------------------------- Moody's Investors Service has downgraded three certificates from one Residential Asset Securities Corporation subprime deal issued in 2002. The transaction is backed by fixed-rate and adjustable- rate subprime mortgage loans originated by Residential Funding Corporation. The master servicer on the transaction is Residential Funding Corporation. HomeComings Financial Network, Inc. is the primary servicer for the majority of the loans in the deal. The three subordinate classes in the fixed-rate group have been downgraded because existing credit enhancement levels may be low given the current projected losses on the underlying pools. The pool of mortgages has seen losses in recent months and future loss could cause a more significant erosion of the overcollateralization. The fixed-rate pool currently has $827,401 of OC which is below the 50 bp OC floor as of the August 25 reporting date. These are Moody's complete rating actions: * Issuer: Residential Asset Securities Corporation Downgrades: -- Series 2002-KS2; Class M-I-1, downgraded to Aa3 from Aa2; -- Series 2002-KS2; Class M-I-2, downgraded to Ba1 from Baa3; -- Series 2002-KS2; Class M-I-3, downgraded to Caa3 from B1. REVLON CONSUMER: S&P Downgrades Corporate Credit Rating to CCC+ --------------------------------------------------------------- Standard & Poor's Ratings Services lowered all of its ratings on New York City-based Revlon Consumer Products Corp., including its corporate credit rating, to 'CCC+' from 'B-'. The outlook is negative. About $1.4 billion total debt was outstanding at June 30, 2006. "The downgrade follows Revlon's announcement that it is substantially lowering its earnings guidance for fiscal 2006 due to the discontinuance of Vital Radiance and continued operating challenges, and will seek an amendment to its credit facility," said Standard & Poor's credit analyst Alison Sullivan. This represents the company's second earnings guidance revision and potentially its third bank facility amendment in 2006. Previously, Standard & Poor's expected operating improvement in the second half of fiscal 2006. These events have led to greater uncertainty regarding the company's ability to improve performance and reduce leverage. Revlon announced that 2006 adjusted EBITDA is estimated to be $75 Million - $85 million, including $129 million of special charges. In comparison, in June 2006 Revlon stated that 2006 adjusted EBITDA would be approximately even with or somewhat below 2005 levels of $167 million, including a $60 million operating loss associated with Vital Radiance and $10 million restructuring charge. The company's Vital Radiance brand, launched in January 2006, will be discontinued resulting in a $110 million negative impact in 2006 ($70 million will occur in the third quarter). Revlon's restructuring initiative will also lead to $29 million ($21 million cash) of charges, which are expected to provide $34 million in savings with $5 million to be realized in 2006. Revlon is seeking an amendment to its credit facility to add back Vital Radiance and streamlining charges. The company previously amended its bank facility in February 2006 and July 2006 to adjust covenant levels and/or definitions. ROBERT MULHOLLAND: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Robert Timothy Mulholland 18710 20th Avenue Southeast Bothell, WA 98012 Bankruptcy Case No.: 06-13302 Chapter 11 Petition Date: September 26, 2006 Court: Western District of Washington (Seattle) Judge: Samuel J. Steiner Debtor's Counsel: Darrel B. Carter, Esq. CBG Law Group PLLC 11100 Northeast 8th Street, Suite 380 Bellevue, WA 98004 Tel: (425) 283-0432 Estimated Assets: Less than $50,000 Estimated Debts: $1 Million to $10 Million The Debtor did not file a list of its 20 largest unsecured creditors. ROWE COS: Gets AMEX Noncompliance Notice Due to Chapter 11 Filing ----------------------------------------------------------------- The Rowe Companies has received written notice from the American Stock Exchange informing the the Company that it failed to meet one of AMEX's continued listing standards. Specifically, the Company was notified that it is not compliance with Section 1003(a)(iv) of the AMEX Company Guide because, based on the Company's voluntary commencement of Chapter 11 proceedings, the Company has sustained losses which are so substantial in relation to its overall operations, or its financial condition has become so impaired that it appears questionable, in the opinion of AMEX, as to whether the Company will be able to continue operations and/or meet its obligations as they mature. The notification states that in order to maintain its AMEX listing, the Company must submit a plan by Oct. 23, 2006, advising AMEX of the action the Company has taken, or will take, to comply with Section 1003(a)(iv) by the earliest possible date. The Company has not yet determined how it will respond to the notification. Headquartered in McLean, Virginia, The Rowe Companies -- http://www.therowecompanies.com/-- manufactures upholstered retail home and office furniture, interior decorations, tableware, lighting fixtures, and other interior design accessories. The Company owns 100% of stock of manufacturing and retail subsidiaries, Rowe Furniture -- http://www.rowefurniture.com/-- and Storehouse, Inc. -- http://www.storehousefurniture.com/ The Company and its two of its debtor-affiliates filed for chapter 11 protection on Sept. 18, 2006 (Bank. E.D. Va. Case Nos. 06-11142 to 06-11144). Dylan G. Trache, Esq., H. Jason Gold, Esq., and Valerie P. Morrison, Esq., at Wiley Rein & Fielding LLP, represent the Debtors. When the Debtors filed for protection from their creditors, The Rowe Companies listed total assets of $130,779,655 and total debts of $93,262,974; Rowe Furniture estimated assets between $50 million and $100 million and debts between $10 million and $50 million; and Storehouse, Inc. estimated assets and debts between $10 million and $50 million. SACO I: Moody's Assigns Ba2 Rating to Class B Subordinated Notes ---------------------------------------------------------------- Moody's Investors Service has assigned a Aaa rating to the senior notes issued by SACO I Trust 2006-8, and a Ba2 rating to the subordinate notes in the deal. The rating on the Class A notes are based on the credit quality of the loans and on the protection offered by subordination, excess spread, overcollateralization and a certificate guaranty insurance policy issued by Ambac Assurance Corporation, which has an insurance financial strength rating of Aaa. The rating on the Class B notes is based on the credit quality of the loans and on the protection offered by subordination, excess spread, and overcollateralization. Moody's expects collateral losses to range from 5.10% to 5.60%. GMAC Mortgage Corporation will service 72.7% of the loans and EMC Mortgage Corporation will service 27.3% of the loans. LaSalle Bank National Association will act as master servicer. These are the actions taken: * Issuer: SACO I Trust 2006-8 -- Mortgage-Backed Notes, Series 2006-8 Class A, Assigned Aaa Class A-IO, Assigned Aaa Class B, Assigned Ba2 SAINT VINCENTS: Court Approves Asset Sale to St. John's University ------------------------------------------------------------------ The Honorable Adlai S. Hardin, Jr., of the U.S. Bankruptcy Court for the Southern District of New York authorizes Saint Vincents Catholic Medical Centers of New York and its debtor-affiliates to consummate the private sale of their School of Allied Health Professions business and related real property located at 175-05 Horace Harding Expressway, Fresh Meadows, in New York, in accordance with their asset purchase agreement with St. John's University, dated July 28, 2006. The order is subject to the Court first authorizing the Debtors to complete the purchase of the real property from Turnpike Gardens, Inc., and that transaction having closed or closing effectively contemporaneously with the closing of the Contemplated Transactions. As reported in the Troubled Company Reporter on Aug. 24, 2006, the Debtors sought the Court's authority to sell these assets to St. John's for $7,770,000, plus the assumption of certain liabilities: (a) a parcel of nonresidential real property and improvements located at 175-05 Horace Harding Expressway, Fresh Meadows, in New York; and (b) the business of the School of Allied Health Professions located at the premises, which consists of five programs: (i) a Physician's Assistant program, (ii) a Medical Technology program, (iii) a Radiography program, (iv) a Pathology Assistant program, and (v) an EMS Institute program. The Debtors are authorized and directed to: (1) execute and deliver, perform under, consummate, and implement the APA, with all necessary additional instruments and documents; and (2) take all other actions as may be requested by St. John's University, to assign, transfer, or reduce to possession the purchased assets, or as may be appropriate to the performance of the APA obligations. Judge Hardin further rules that: -- the Debtors will deliver the net proceeds of the sale to General Electric Capital Corporation on account of a postpetition financing secured by a first priority lien on the Purchased Assets; -- to the extent the payment results in a failure of the adequate protection provided to Patsy Merola or Great American Insurance Company, Ms. Merola and GAIC will be entitled to assert their rights as may be available to them under Section 507(b) of the Bankruptcy Code; -- all persons and entities holding Liens against in, or with, the Debtors and the Purchased Assets relating to the Debtors, the Purchased Assets, the operation of the Debtors' business prior to the Closing, or the transfer of the Purchased Assets to the Purchaser, are forever barred, estopped, and permanently enjoined from asserting Liens against the Purchaser and its assets; -- the transfer of the Purchased Assets constitutes a legal, valid, and effective transfer; will not be taxed; and will not be subject to any tax under any law imposing a stamp tax or other similar tax on any of the Debtors' transfers or sales in connection with the Contemplated Transactions; -- no assets owned and used by Computer Sciences Corporation in line with its provision of services under an information technology service agreement with the Debtors are sold or transferred to the Purchaser by the APA; and -- all obligations of the Debtors under the APA will be afforded administrative expense priority in the Debtors' Chapter 11 cases. All objections that have not been withdrawn, waived, or settled, including Ms. Merola and GAIC's objections, are overruled on the merits with prejudice, Judge Hardin says. 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. 35 Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SAINT VINCENTS: Taps Caronia Corp as Estimation Consultant ---------------------------------------------------------- Saint Vincents Catholic Medical Centers of New York and its debtor-affiliates, together with their Official Committee of Unsecured Creditors, and the Official Committee of Tort Creditors, jointly seek permission from the U.S. Bankruptcy Court for the Southern District of New York to employ and retain Caronia Corporation as their consultant in connection with the estimation of medical malpractice claims filed prior to the bar date. The Parties determined that Caronia has substantial experience in estimating potential liability for medical malpractice claims in a variety of relevant contexts and valuing portfolios of medical malpractice claims for transfer purposes because Caronia worked with healthcare providers for more than 35 years in evaluating and managing medical professional liability claims. In New York, Caronia has provided services to, among others, New York-Presbyterian, The University Hospital of Columbia and Cornell, and New York University Hospital. As Estimation Consultant, Caronia is tasked to: (1) prepare an expert estimation report based on an analysis of the Debtors' potential aggregate liability arising out of the Medical Malpractice Claims; and (2) provide expert testimony relating to the Medical Malpractice Estimation, including, consulting with the Parties and their counsel and others in connection with the preparation of the Estimation Report, all pursuant to the terms and conditions set forth in a stipulation and agreed protocol and protective order executed by the Parties and Caronia on September 21, 2006. As set forth in the Protocol and Protective Order, the Parties expressly agree that the Estimation Report will include: * a description of Caronia's credentials and experience in performing a valuation of medical malpractice claims generally and in New York, the background of each of the firm's professionals working on the Estimation Report, and a list of expert retentions in the last 10 years; * a list of the general categories of documents that Caronia has relied on while preparing the Estimation Report, including a detailed list of any documents that are not confidential; * an explanation of Caronia's methodology in reaching individual claim values; * the Debtors' total estimated aggregate potential medical malpractice liability for each region; * a comparison of the Aggregate Potential Liability against the Debtors' actuarial estimates; and * a "sensitivity" analysis providing a "confidence range" based on the addition or subtraction of certain assumptions employed by Caronia in the Medical Malpractice Estimation. If a Party withdraws from the joint retention of Caronia and disclaims the firm as its expert, the Debtors will have the right to continue to employ Caronia for purposes of the Medical Malpractice Estimation, subject to Caronia's compliance with the Protocol and Protective Order. Caronia's will be paid: -- $250 per file/claim reviewed in preparation of the Extimation Report; and -- $100-$200 per hour depending on the professional or paraprofessional working on the engagement for time spent drafting the Estimation Report, preparing testimony or actually testifying. The Debtors will also reimburse Caronia for expenses incurred. James M. Page, vice president of Caronia, assures the Court that his firm has no connection with, and holds no interest adverse to, the Debtors, their creditors, or any other party-in- interest. Caronia is a "disinterested person," as that term is defined in Section 101(14) of the Bankruptcy Code, Mr. Page says. 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. 35 Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SATELITES MEXICANOS: Judge Drain Approves Solicitation Procedures ----------------------------------------------------------------- The Honorable Robert D. Drain, of the U.S. Bankruptcy Court for the Southern District of New York, approved the Solicitation and Tabulation Procedures to be used in connection with Satelites Mexicanos, S.A. de C.V.'s solicitation of votes for its Chapter 11 Plan of Reorganization. The Court finds that the Debtor's procedures for soliciting and tabulating votes on its First Amended Plan of Reorganization provide for a fair and equitable voting process and are consistent with the requirements of the Bankruptcy Code and the Bankruptcy Rules. Judge Drain sets Sept. 13, 2006, as the record date for purposes of determining the creditors entitled to vote on the Plan. The record date for purposes of making distributions under the Plan will be set at the time of the confirmation hearing on the Plan. Holders of claims in Class 2 Senior Secured Note Claims and Class 4 Existing Bond Claims; and holders of allowed interests in Classes 6A and 6B Existing Preferred Stock Interests, and Classes 7A and 7B Existing Common Stock Interests, may vote on the Plan. Judge Drain says ballots need not be provided to the holders of claims in Class 1 Priority Non-Tax Claims, Class 3 Other Secured Claims, and Class 5 General Unsecured Claims, because the Plan provides that those classes are unimpaired and, therefore, conclusively presumed to accept the Plan pursuant to Section 1126(f) of the Bankruptcy Code. Ballots must be returned to Kurtzman Carson Consultants, Inc., the Debtor's notice and balloting agent, no later than Oct. 20, 2006. Late votes will not be counted. Voting creditors are deemed to have voted the full amount of their claim or interest. Judge Drain allows the Senior Secured Notes Claims in Class 2 for $203,388,000 and the Existing Bonds Claims in Class 4 for $320,000,000, solely for voting purposes. Each interest in Classes 6A and 6B and Classes 7A and 7B is also temporarily allowed for voting purposes. The Debtor said its Plan has the support of: -- Servicios Corporativos Satelitales, S.A. de C.V.; -- Loral Skynet Corporation and Loral SatMex, Ltd.; -- Principia S.A. de C.V.; -- the beneficial holders of more than 67% of the 10-1/8% Unsecured Senior Notes due November 1, 2004; and -- the beneficial holders of more than 67% of the Senior Secured Floating Rate Notes due June 30, 2004. 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. 6; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SATELITES MEXICANOS: Court Sets Confirmation Hearing on Oct. 26 --------------------------------------------------------------- The Honorable Robert D. Drain, of the U.S. Bankruptcy Court for the Southern District of New York, will convene a hearing on Oct. 26, 2006, at 10:00 a.m., to consider confirmation of Satelites Mexicanos, S.A. de C.V.'s First Amended Plan of Reorganization. As reported in the Troubled Company Reporter on Aug. 21, 2006, the Debtor asked Judge Drain to convene a hearing to consider confirmation of its Chapter 11 Plan of Reorganization seven days after the Voting Deadline. The Confirmation Hearing may be continued from time to time by the Court or the Debtor without further notice other than announcement of adjournments in open court or as indicated in any notice of agenda of matters scheduled for hearing filed with the Court. However, the Debtor will provide notice of any continuance to counsel for the ad hoc committee of holders of its Senior Secured Floating Rate Notes due June 30, 2004; and the ad hoc committee of holders of its 10-1/8% Unsecured Senior Notes due Nov. 1, 2004. Moreover, confirmation of the Plan will not occur later than Dec. 11, 2006, without the consent of the Ad Hoc Committees. Judge Drain authorized the Debtor to publish the Confirmation Hearing Notice, on one occasion, by Sept. 25, 2006, in The New York Times (National Edition) and in Reforma, a Mexican newspaper. Any objections to confirmation of the Plan must be filed with the Court by Oct. 20, 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. 6; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SPRINGS WINDOW: Moody's Assigns Loss-Given-Default Ratings ---------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency upgraded its B1 Corporate Family Rating to Ba3 for Springs Window Fashions, LLC. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $250 million Term Loan due 2013 B1 Ba3 LGD2 29% $100 million Revolver due 2011 B1 Ba3 LGD2 29% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). SUNNY DELIGHT: Moody's Assigns Loss-Given-Default Ratings --------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency revised its Caa1 Corporate Family Rating to Caa3 for Sunny Delight Beverages Company. Additionally, Moody's confirmed its probability-of-default ratings and assigned loss-given-default ratings on these loans facilities: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2010 Caa1 Caa1 LGD2 24% Sr. Sec. Term Loan Due 2010 Caa1 Caa1 LGD2 24% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Sunny Delight Beverages Company -- http://www.sunnyd.com/-- is a global manufacturer and distributor of juice drinks and sports beverages under the Sunny Delight brand name. The Company's U.S. headquarter is located at Cincinnati, Ohio, and its European headquarter is located at Barcelona, Spain. The company produces and markets SunnyD(R) Original, SunnyD Intense Sport(TM) and SunnyD Baja(TM). THOMPSON CREEK: S&P Rates Proposed $125 Million Debt at CCC+ ------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'B-' corporate credit rating to Englewood, Colorado-based Thompson Creek Metals Co. The outlook is stable. At the same time, Standard & Poor's assigned its 'B' bank loan rating and '1' recovery rating to Thompson's proposed $350 million of first-lien senior secured debt and 'CCC+' and '3' recovery rating to $125 million of proposed second-lien debt. The first-lien debt is rated one notch above the corporate credit rating; the 'B' rating and the '1' recover rating indicate that lenders can expect full recovery of principal in the event of a payment default. The second-lien debt is rated one notch below the corporate credit rating; the 'CCC+' rating and the '3' recovery rating indicate that lenders can expect meaningful (50%-80%) recovery of principal in the event of a payment default. Proceeds from the proposed financing will be used to finance the acquisition of Thompson Creek by Blue Pearl Mining Ltd (unrated). "We expect the company's cash flow to decline in conjunction with a decline in molybdenum prices, but we expect that the company will still have enough cash flow to meet its aggressive debt amortization payments in the short term," said Standard & Poor's credit analyst Dominick D'Ascoli. "We could revise the outlook to negative if molybdenum prices fall meaningfully below our expectations or if there is a significant operating disruption. We could revise the outlook to positive if molybdenum prices are expected to remain at very high levels over the next several years, allowing the company to meet its debt amortization. One year of higher-than-expected prices is unlikely to cause us to revise the outlook, given the aggressive amortization schedule." Thompson Creek produces molybdenum as a primary product from its mines, which places it in the minority, as two-thirds of molybdenum is produced as a by-product of other mining, primarily copper mining. This industry dynamic negatively affects primary producers, because declines in molybdenum prices are unlikely to change the production level of copper producers, which could exacerbate declines in molybdenum prices. THORNBURG MORTGAGE: Moody's Assigns B2 Rating to Class B-5 Notes ---------------------------------------------------------------- Moody's Investors Service assigned an Aaa rating to the senior certificates issued by Thornburg Mortgage Securities Trust 2006-5 and ratings ranging from Aa2 to B2 to the subordinate certificates in the deal. The securitization is backed by Wells Fargo Bank, N.A. (72.19%) and Thornburg Mortgage Home Loans, Inc. (27.60%) originated adjustable mortgage loans. The ratings are based primarily on the credit quality of the loans and on the protection from subordination. Moody's expects collateral losses to range from 0.20% to 0.40%. The mortgage loans will be serviced by Wells Fargo Bank N.A. (72.19%), Thornburg Mortgage Home Loans, Inc. (27.29%), and various other banks, savings and loan associations and other mortgage lending institutions. Cenlar FSB will subservice all of the mortgage loans serviced by Thornburg. Wells Fargo Bank, N.A. will act as master servicer. Wells Fargo Bank, N.A. is rated SQ1 by Moody's as a master servicer. These are Moody's rating actions: * Issuer: Thornburg Mortgage Securities Trust 2006-5 * Mortgage Loan Pass-Through Certificates, Series 2006-5 Cl. A-1, Assigned Aaa Cl. A-2, Assigned Aaa Cl. A-X, Assigned Aaa Cl. A-R, Assigned Aaa Cl. B-1, Assigned Aa2 Cl. B-2, Assigned A2 Cl. B-3, Assigned Baa2 Cl. B-4, Assigned Ba2 Cl. B-5, Assigned B2 Class B-4 and Class B-5 notes are being offered in a privately negotiated transaction without registration under the 1933 Act. The issuance was designed to permit resale under Rule 144A. TOWER RECORDS: Section 341(a) Meeting Scheduled on Friday --------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of MTS Incorporated, dba Tower Records, and its debtor-affiliates' creditors at 10:00 a.m., on Sept. 29, 2006, at Room 2112, Second Floor, J. Caleb Boggs Federal Building in Wilmington, Delaware. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in West Sacramento, California, MTS, Inc., dba Tower Records -- http://www.towerrecords.com/-- is a retailer of music in the U.S., with nearly 100 company-owned music, book, and video stores. The Company and seven of its affiliates filed for chapter 11 protection on Aug. 20, 2006 (Bankr. D. Del. Case Nos. 06-10886 through 06-10893). Richards, Layton & Finger, P.A. and O'Melveny & Myers LLP represent the Debtors. The Official Committee of Unsecured Creditors is represented by McGuirewoods LLP. When the Debtors filed for protection from their creditors, they estimated assets and debts of more than $100 million. The Debtors' exclusive period to file a chapter 11 plan expires on Dec. 18, 2006. The Company and its affiliates previously filed for chapter 11 protection on Feb. 9, 2004 (Bankr. D. Del. Lead Case No. 04-10394). The Court confirmed the plan on March 15, 2004. TRW AUTOMOTIVE: Fitch Affirms BB Issuer Default Rating ------------------------------------------------------ Fitch Ratings has affirmed these ratings of TRW Automotive Holdings Inc.: -- Issuer Default Rating 'BB' -- Senior secured bank lines 'BB+' -- Senior unsecured notes 'BB-' -- Senior subordinated unsecured Notes 'B+' Fitch's ratings reflect TRW's strong diversity of OEM customers and geographies, and the company's technology-driven products that have allowed the company to weather an onerous industry environment. Despite significant production cutbacks by North American manufacturers and industry cost challenges, TRW's operating efficiency, a substantial book of business outside of North America and continued healthy demand for TRW's products has sustained margins through the industry turmoil. The company's margins remain at the high end of the supplier industry, providing a buffer in the event of further deterioration in industry fundamentals. Even in an adverse economic and industry scenario through 2007, Fitch expects TRW to remain safely cashflow positive, although debt reduction could be limited in such a scenario. The Rating Outlook is stable. TRW's operating performance, balance sheet and credit metrics have remained stable in an industry environment that has precipitated several supplier bankruptcies due to price erosion, increased commodity costs, volatile OEM production cadences and lower OEM unit volume on market share losses. The company has been able to avoid the perils faced by many suppliers due to its lower relative dependence on the North American operations of Ford and General Motors, geographic diversity by which nearly two-thirds of total revenue is generated outside of North America, and product line-up of safety components and fuel-saving technologies which continue to see strong demand. At the end of 2Q06, the company had: * $1.6 billion in secured bank debt, * $1.0 billion in senior unsecured notes, * $0.3 billion in senior subordinated unsecured notes, and * $0.1 billion in short term debt and capital leases, totaling $3 billion of debt. Less $520 million of cash and marketable securities, net debt was $2.5 billion, representing a decrease of $45 million compared to year-end 2005. The change in net debt includes a premium paid of $57 million related to the tender for GBP94.6 million in 10-7/8% bonds from its Lucas Industries Limited subsidiary. On a total adjusted debt basis, the 2Q06 debt level was $3.7 billion down $0.2 billion compared to $3.9 billion at year end 2005. TRW was well within its covenant agreements on capital expenditures, Interest Coverage and Leverage. At the end of 2Q06, TRW had approximately $833 million of availability under its revolver after $67 million in outstanding LOCs. Under the US securitization facility, approximately $233 million of receivables were eligible for borrowings and only about $121 million would have been available for funding. In addition, approximately EUR119 million and GBP25 million were available under the European facilities. As of June 30, TRW had nothing outstanding on any of its A/R programs. Including the cash and marketable securities balance of $520 million, total availability at the end of 2Q06 was approximately $1.7 billion. While TRW's customer base and manufacturing footprint are one of the more diverse in the Fitch supplier universe, the company is not completely immune to changes in its larger customers' production schedules. However, sales to customers other than Ford and General Motors accounted for more than 70% of 2005 revenues. Clearly demonstrating limited exposure to the domestic OEs, despite 4Q06 production cuts of 21%, 12% and 10% for Ford, GM and Chrysler Group, respectively, TRW reduced its Street guidance to a full year revenue range of $13.0 to $13.2 billion, down from a range of $13.0 to $13.3. The less than 1% reduction in the top end of revenue guidance resulted in a 5% to 6% reduction in the range of forecasted net income or roughly $10 to $16 million. Government continues to pressure the industry for increased vehicular safety. TRW manufactures the type of safety components and systems which have been the focus of recent legislation. For example, the Alliance of Automobile Manufacturers and the Insurance Institute for Highway Safety announced 'voluntary performance criteria' in front-to-side collisions. The criteria includes the use of a wide range of occupant protection technologies and designs which affect front structural components, side air bags, air bag curtains and side-impact structures. By September 1, 2007, 50% of all vehicles sold by a manufacturer in the U.S. are supposed to meet the front-to-side performance criteria, and by September 2009, manufacturers are to be 100% compliant. In another example, NHTSA has mandated direct tire pressure monitoring systems, capable of detecting under-inflation. The phase-in period begins with 20% compliance of all vehicles sold from October 5, 2005 to August 31, 2006, then 70% from September 1, 2006 to August 21, 2007; and then all vehicles thereafter. Finally, in September NHTSA proposed a rule at the direction of congress that outlines a federal mandate that all new vehicles be equipped with electronic stability control by the 2012 model year. NHTSA studies have indicated a dramatic reduction in crashes for vehicles equipped with ESC. TUBULAR TECHNOLOGIES: Loses Lease on Lexington, N.C. Facility ------------------------------------------------------------- On Oct. 28, 2004, Tubular Technologies, LLC, entered into a five- year lease agreement with S-2 Properties, Inc., to lease nonresidential real property at 4157 Old Highway 52 in Lexington, North Carolina. On Jan. 20, 2006, Tubular Technologies filed for chapter 11 protection (Bankr. D. S.C. Case No 0600228). On Dec. 17, 1998, S-2 granted GrandSouth Bank a Deed of Trust. The Deed of Trust provided GrandSouth with an interest in rental proceeds generated by the Leased Premises, and it further provided that GrandSouth may foreclose on the Leased Premises if S-2 defaults on an agreement with GrandSouth. S-2 defaulted on its obligations to GrandSouth; therefore, GrandSouth exercised its right to receive the rent that Debtor paid to S-2 and commenced a foreclosure action to obtain possession of the Leased Premises. After notice to required parties in interest, including Debtor, S-2, Advance Financial Corp., and O'Neal Steel, Inc., and without objection of any party, on March 22, 2006, the Bankruptcy Court granted GrandSouth relief from the automatic stay to pursue a foreclosure action and other collection action against S-2 in North Carolina state court. The order modified the automatic stay provided by Sec. 362(a) to allow GrandSouth to foreclose. The order also reserved GrandSouth's ability to seek eviction of Debtor from the Leased Premises. GrandSouth's foreclosure action proceeded in the North Carolina state, and a ruling by the state court is under advisement and may be issued at any time. Simultaneously, S-2 and its principals have a separate state court action pending against GrandSouth. Because the Debtor filed for bankruptcy after Oct. 17, 2005, the amendments to the Bankruptcy Code under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 required the Debtor to make its decision about whether to assume, assume and assign, or reject the lease within 120 days, or ask for more time to make that decision. On May 12, 2006, Tubular Technologies moved to extend the time to assume or reject the Lease pursuant to Sec. 365(d)(4)(B)(i). Despite the fact that the Motion to Extend was filed 112 days after the petition date, the Debtor did not request an expedited hearing or take further action to request that the Court address the Motion to Extend and render a decision prior to May 20, 2006, the one-hundred twentieth day after the petition date. Instead, the Debtor filed and served a hearing notice, which indicated that a hearing on the Motion to Extend would be scheduled for June 13, 2006, if a return, response, or objection to the Motion to Extend was properly filed with the Court and served on Debtor. On May 26, 2006, S-2 filed a timely objection to the Motion to Extend. In the objection, S-2 asserted that cause did not exist to grant the Motion to Extend. S-2 also noted that pursuant to Sec. 365(d)(4)(B), the Court could not extend the deadline to assume or reject the Lease under Sec. 365(d)(4)(A) because such relief was not granted on or before May 20, 2006. S-2 also asserted that the Court lacked jurisdiction to so act. The Honorable John E. Waites held a hearing on the Motion to Extend on June 13, 2006, 144 days after the petition date. At the hearing, the Debtor indicated that it needed more time to determine whether to assume or reject the Lease because GrandSouth's foreclosure action could affect its interests in the Leased Premises. During the course of the hearing, Todd Boudreaux, Esq., the Debtor's lawyer, also admitted that in order to extend the time to assume or reject a nonresidential lease under Sec. 365(d)(4)(B), the Court must extend the time by entering an order within 120 days of filing the bankruptcy petition. Despite that concession, Mr. Boudreaux asserted that Tubular Technologies was, nevertheless, entitled to an extension to assume or reject because: (1) S-2 lacked standing to object to the Motion to Extend because under the terms of the Deed of Trust between GrandSouth and S-2, GrandSouth assumed S-2's right to collect rent from the Debtor and (2) the deadline for entering an order on the Debtor's Motion to Extend should be extended for excusable neglect pursuant to Rule 9006 of the Federal Rules of Bankrupty Procedure and the Court's inherent equitable authority under Sec. 105(a). Judge Waites rejected the Debtor's standing argument in light of the fact that S-2 was the owner of the Leased Premises and lessor during the 120 days following the petition date in this case (as admitted in Debtor's Motion to Extend). Furthermore, Judge Waite viewed Sec. 365(d)(4)(B) as a self executing statutory provision which required strict compliance before granting an extension of time to assume or reject a nonresidential lease. The Court also rejected the Debtor's excusable neglect argument because (a) Debtor failed to present evidence demonstrating excusable neglect and (b) the excusable neglect standard did not apply to the time limits prescribed by statute. Accordingly, in light of the admission made by Debtor's counsel and the plain meaning of the Reform Act's amendments to Sec. 365(d)(4)(B), on June 21, 2006, the Court entered an order which held that Debtor was not entitled to an extension of time to assume or reject the Lease because the Debtor failed to obtain an order extending the time to assume or reject before the 120 day deadline imposed by Sec. 365(d)(4)(B)(i). After denying the Debtor's Motion to Extend, the Court concluded that the Lease was deemed rejected; and thus, pursuant to Sec. 365(d)(4)(A), the Court ordered Debtor to "immediately surrender the Leased Premises to S-2." As a result of the Rejection Order, the sheriff of Davidson County, North Carolina, accompanied representatives of S-2 to the Leased Premises. Prior to any enforcement action, Debtor's managers instructed employees to leave, and they left without securing the Leased Premises. In response to the Rejection Order, the Debtor filed a notice of appeal, a Motion for Stay, and a Motion to Expedite Hearing on the Motion for Stay on June 22, 2006. On June 23, 2006, the Court granted Debtor's Request for Expedited Hearing and provided an interim stay until a further hearing on the Motion for Stay could be held. As a condition of providing interim stay relief, Judge Waites reserved the authority to further grant or deny a stay following a hearing on the merits of the Motion for Stay scheduled for June 27, 2006. The Debtor, S-2, GrandSouth, AFC, and Rubbermaid Commercial Products attended the hearing on the Motion for Stay. In support of its Motion for Stay, the Debtor contended that it would suffer irreparable harm if a stay pending appeal was not granted because absent such a stay, S-2 would take possession of the Leased Premises and prevent the Debtor from operating its business there. The Debtor also asserted that its inability to operate at the Leased Premises for two days or more would put it out of business. The Debtor further contended that there was a substantial likelihood that it would succeed on the merits of its appeal. In support of that assertion, Debtor directed the Court's attention to United States v. Stollings, 516 F.2d 1287 (4th Cir. 1975) to demonstrate that a court may extend time in such situations, despite the plain language of a rule or statute establishing a specific time to act. According to Rubbermaid, a closing of Debtor's business would stop the production of certain components that that Debtor produced for Rubbermaid and subject Rubbermaid to certain contractual fines and a loss of business. GrandSouth noted that its pending foreclosure action in North Carolina state court was nearing a conclusion; and thus, the Court should grant a stay pending appeal because a judgment in GrandSouth's favor may deprive S-2 of the right to possession of the Leased Premises. GrandSouth also stated a willingness to consider a new lease agreement with the Debtor and allow the Debtor to continue operations at the leased premises, if GrandSouth prevailed on the foreclosure action. If GrandSouth did not prevail in the foreclosure action or the related separate pending action, S-2's rights as owner of the Leased Premises would remain. As of the date of the hearing on the Motion for Stay, a final adjudication of GrandSouth's foreclosure action remained unresolved. Nevertheless, whether or not GrandSouth ultimately prevails in its foreclosure action, S-2 was the lessor during the applicable 120 days following the petition date. After an announcement of settlement, AFC contended that the stay should be granted because the language of Sec. 365(d)(4) may be constitutionally defective in that it mandates the immediate surrender of nonresidential leased property in possible contravention of state law procedures to recover possession of leased property. In light of the record developed at the hearing, the Debtor and S- 2 stipulated to a stay until July 12, 2006, to provide parties sufficient time to raise further stay issues before the U.S. District Court in the appellate proceeding. Given the parties' consent and after fully considering the evidence, Judge Waites granted a stay pending appeal for that limited period of time. The U.S. District Court reviewed Judge Waites' Stay Order, and concluded it was inadequate for purposes of Bankruptcy Rule 8005 because it was based on the consent of the parties to a stay for a limited period of time and did not otherwise contain sufficiently detailed findings for review. In response to the instruction of the District Court, Judge Waites issued detailed findings of fact and conclusions of law, reported at 2006 WL 2529588. This time around, Judge Waite concludes that the Debtor's Motion for Stay must be denied. The Debtor has not presented that it will likely prevail on the merits or that, at a minimum, there is a substantial question for an appeal, Judge Waite says. Furthermore, Judge Waite opines, the public interest weighs in favor of denying Debtor's Motion to Stay. In light of this ruling, Judge Waite rules, any temporary stay of the Rejection Order, previously prescribed by the Court, is terminated. Tubular Technologies is represented by: Todd Boudreaux, Esq. Shepard, Plunkett, Hamilton, Boudreaux & Tisdale, LLP 701 Greene Street, Suite 104 Augusta, Georgia 30901-2322 Telephone (706) 722-4111 UNIFI INC: Moody's Assigns Loss-Given-Default Rating ---------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the US Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors and Agricultural Cooperative sectors, the rating agency confirmed its B3 Corporate Family Rating for Unifi, Inc., and its Caa1 rating on the Company's $190 million senior secured notes due 2014. In addition, Moody's assigned an LGD4 rating to notes, suggesting noteholders will experience a 61% loss in the event of a default. Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Greensboro, North Carolina, Unifi, Inc. -- http://www.unifi-inc.com/-- is a diversified producer and processor of multi-filament polyester and nylon textured yarns and related raw materials. The Company adds value to the supply chain and enhances consumer demand for its products through the development and introduction of branded yarns that provide unique performance, comfort and aesthetic advantages. Key Unifi brands include, but not limited to: Sorbtek(R), A.M.Y.(R), Mynx(TM) UV, Reflexx(R), MicroVista(R) and Satura(R). Unifi's yarns and brands are readily found in home furnishings, apparel, legwear and sewing thread, as well as industrial, automotive, military and medical applications. VARIG S.A.: Appeals Court Allows ANAC to Redistribute Routes ------------------------------------------------------------ Minister Nacy Andrighi of the Federal Court of Appeals in Brazil authorized the Brazilian Civil Aviation Agency to continue the redistribution of routes, airport slots and schedules formerly used by VARIG, S.A., to other airline companies, Investnews (Brazil) reports. According to the Appeals Court, distribution of slots and routes was "the exclusive preserve of ANAC" as the industry regulator, Dow Jones Newswires relates. As previously reported, ANAC filed a formal complaint against Judge Marcia Cunha Silva de Carvalho of the Commercial Bankruptcy and Reorganization Court in Rio de Janeiro for stopping the redistribution of VARIG's former routes and slots. ANAC argued before the Brazilian Justice Council that only the federal justice could suspend the redistribution of routes and slots. The Brazilian Bankruptcy Court fined ANAC BRL1,000,000 -- $467,500 -- for violating an injunction imposed in VARIG's case. The Injunction allowed ANAC to act only if VARIG fails to resume service on its 272 routes within 30 days of receiving a new route permit. At that time, VARIG had not received new permits. ANAC redistributed VARIG's routes to TAM Linhas Aereas, S.A.; Gol Linhas Aereas Inteligentes; and BRA. Judge Cunha lifted the fine after ANAC agreed to stop its action. Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's largest air carrier and the largest air carrier in Latin America. VARIG's principal business is the transportation of passengers and cargo by air on domestic routes within Brazil and on international routes between Brazil and North and South America, Europe and Asia. VARIG carries approximately 13 million passengers annually and employs approximately 11,456 full-time employees, of which approximately 133 are employed in the United States. The Company, along with two affiliates, filed for a judicial reorganization proceeding under the New Bankruptcy and Restructuring Law of Brazil on June 17, 2005, due to a competitive landscape, high fuel costs, cash flow deficit, and high operating leverage. The Debtors may be the first case under the new law, which took effect on June 9, 2005. Similar to a chapter 11 debtor-in-possession under the U.S. Bankruptcy Code, the Debtors remain in possession and control of their estate pending the Judicial Reorganization. Sergio Bermudes, Esq., at Escritorio de Advocacia Sergio Bermudes, represents the carrier in Brazil. Each of the Debtors' Boards of Directors authorized Vicente Cervo as foreign representative. In this capacity, Mr. Cervo filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the United States. As of March 31, 2005, the Debtors reported BRL2,979,309,000 in total assets and BRL9,474,930,000 in total debts. (VARIG Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) VARIG S.A.: Cuts Fare on Five Local and Two International Flights ----------------------------------------------------------------- VARIG, S.A., offers more than 50% discount on airfares to five local and two international destinations, according to Investnews (Brazil). One of those discounted routes is from Manaus, Brazil, to Caracas, Venezuela. VARIG has obtained four new aircraft and re-established its routes towards Caracas early this month. The airline will also resume flights to Brasilia, Curitiba and Fernando de Noronha, in Brazil. It also plans to resume services to New York and Miami, in the U.S. Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's largest air carrier and the largest air carrier in Latin America. VARIG's principal business is the transportation of passengers and cargo by air on domestic routes within Brazil and on international routes between Brazil and North and South America, Europe and Asia. VARIG carries approximately 13 million passengers annually and employs approximately 11,456 full-time employees, of which approximately 133 are employed in the United States. The Company, along with two affiliates, filed for a judicial reorganization proceeding under the New Bankruptcy and Restructuring Law of Brazil on June 17, 2005, due to a competitive landscape, high fuel costs, cash flow deficit, and high operating leverage. The Debtors may be the first case under the new law, which took effect on June 9, 2005. Similar to a chapter 11 debtor-in-possession under the U.S. Bankruptcy Code, the Debtors remain in possession and control of their estate pending the Judicial Reorganization. Sergio Bermudes, Esq., at Escritorio de Advocacia Sergio Bermudes, represents the carrier in Brazil. Each of the Debtors' Boards of Directors authorized Vicente Cervo as foreign representative. In this capacity, Mr. Cervo filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the United States. As of March 31, 2005, the Debtors reported BRL2,979,309,000 in total assets and BRL9,474,930,000 in total debts. (VARIG Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) VISTEON CORP: Opens $10 Million Technical Center in India --------------------------------------------------------- Global automotive supplier Visteon Corporation opened a $10 million Visteon Technical and Services Center in Chennai, India. The 110,000 square-foot facility is set to become Visteon's center of excellence for automotive embedded software, providing support to Visteon globally, including joint ventures and aftermarket business. The Indian arm of Visteon software development accounts for more than 50% of the global software development within Visteon. The new center will build on the strong capability of the India software team to develop and validate electronic modules for audio products (radios, satellite digital radios, media players), instrument clusters, body control modules, adaptive lighting products, electronic climate controls, powertrain electronics and engine control modules, center displays and other products. The center will also provide business process outsourcing support in the areas of supplier management, finance operations and environmental engineering. Visteon Technical and Services Center will be fully supported by two other existing Visteon entities: Visteon Powertrain Control Systems India Private Ltd., and Visteon Automotive Systems India Private Ltd. "The new technical and service center demonstrates our continuous commitment to India," said Bob Pallash, senior vice president of Visteon Corporation and president of Asia Pacific Customer Group. "This development center will play a crucial role in further driving our success worldwide. With the Indian automotive sector poised for unprecedented growth, our Indian operations are a critical asset in further developing Visteon's competitive edge." Located at Olympia Tech Park, an information technology park in the business district of Chennai, Visteon Technical and Services Center occupies four floors of the "Fortius" building. The new facility is expected to accommodate more than 700 software professionals and 250 business process professionals. The Chennai software operation has been growing steadily since its inception in 1998 and currently has 450 full time employees, including 400 software engineers and 50 business process employees. "This new center is another symbol of our expansion in the country and emphasizes Visteon's strengths and world-class capabilities to deliver services globally and meet the unique requirements of customers in India," said A. Viswanathan, managing director, Visteon India. "The employees deliver remarkable quality, innovation and performance standards. With its world-renowned IT skills and excellent automotive knowledge, India is fast emerging as an excellent base for prototyping, testing, validating and producing auto-components for the global market." With approximately 2,200 employees, Visteon has a significant presence in India in electronics, climate (car air conditioning and engine cooling systems), interior (instrument panel and door trims), rotating electronics and lighting systems. Visteon facilities in India include: * Climate Systems India Limited, * Visteon Automotive Systems India Private Ltd. * Visteon Automotive Systems India Private Ltd. * Visteon Powertrain Control Systems India Private Ltd. * TATA Visteon Automotive Private Ltd. * TACO Visteon Engineering Private Ltd. About Visteon Corporation Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. With corporate offices in the Michigan (U.S.); Shanghai, China; and Kerpen, Germany; the company has more than 170 facilities in 24 countries and employs approximately 50,000 people. * * * As reported in the Troubled Company Reporter on Sept 13, 2006, Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on Van Buren Township, Michigan-based Visteon Corp., and removed the rating from CreditWatch with negative implications where it was placed on Aug. 21, 2006. Visteon, a global manufacturer of automotive components, has total debt of about $2.3 billion. The rating outlook is negative. WAAG PROPERTIES: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Waag Properties LLC 815 Cedar Avenue South Minneapolis, MN 55404 Bankruptcy Case No.: 06-42108 Chapter 11 Petition Date: September 26, 2006 Court: District of Minnesota (Minneapolis) Judge: Dennis D. O'Brien Debtor's Counsel: Joseph W. Dicker, Esq. Joseph W. Dicker PA 1406 West Lake Street, Suite 208 Minneapolis, MN 55408 Tel: (612) 827-5941 Fax: (612) 822-1873 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 6 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Franklin Bank Bank Loan $1,550,000 525 Washington Avenue North Minneapolis, MN 55401 Associated Bank Bank Loan $475,000 1395 Commerce Drive Mendota Heights, MN 55120 Bourgets Bike Works Inc. Bank Loan $210,000 21407 North Central Avenue Phoenix, AZ 85024 Mark Bryant Bank Loan $201,100 5299 DTC Boulevard Suite 215 Englewood, CO 80111 William Wingerd Bank Loan $175,000 4081 Oak Street Orono, MN 55356 Provest Financial Services Bank Loan $110,000 1530 Minnetonka Boulevard Minnetonka, MN 55345 WARNER CHILCOTT: Moody's Assigns Loss-Given-Default Rating ---------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. pharmaceutical sector this week, the rating agency confirmed its B2 Corporate Family Rating for Warner Chilcott Company, Inc. Additionally, Moody's revised or held its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Issuer: Warner Chilcott Company, Inc.: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $870 Million Senior Secured Term loan due 2012 B2 B1 LGD3 36% $239 Million Delayed Draw Secured Term Loan B2 B1 LGD3 36% $150 million Senior Secured Revolving Credit Facility due 2011 Ba1 Ba1 LGD4 36% Issuer: Warner Chilcott Holdings Company III, Limited: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $162 Million Senior Secured Term loan due 2012 B2 B1 LGD3 36% Issuer: Warner Chilcott Corporation: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $351 million Senior Secured Term loan due 2012 B2 B1 LGD3 36% $600 Million Senior Subordinated Notes due 2015 Caa1 Caa1 LGD5 89% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Warner Chilcott is a marketer and developer of branded pharmaceutical products focused on the U.S. women's healthcare and dermatology markets. WATSON PHARMACEUTICALS: Moody's Assigns Loss-Given-Default Rating ----------------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. pharmaceutical sector this week, the rating agency confirmed its Ba1 Corporate Family Rating for Watson Pharmaceuticals, Inc. Additionally, Moody's revised or held its probability-of-default ratings and assigned loss-given-default ratings on these loans and bond debt obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- $300 Million Revolving Credit Facility due 2008 Ba1 Baa2 LGD2 13% $500 Million Revolving Credit Facility due 2011 Ba1 Baa3 LGD3 36% $650 Million Term Loan due 2011 Ba1 Baa3 LGD3 36% $575 Million Convertible Debentures due 2023 Ba2 Ba2 LGD5 87% Moody's explains that current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as Moody's research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock. Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to LGD6 (loss anticipated to be 90% to 100%). Headquartered in Corona, California, United States, Watson Pharmaceuticals, Inc., is a specialty pharmaceutical company focused on branded and generic products. Revenues in 2005 totaled approximately $1.6 billion. WELLMAN INC: Consolidating all Fiber Production in Palmetto Plant ----------------------------------------------------------------- Wellman, Inc., plans to restructure its U.S. fiber operations, which are intended to improve its operating results, reduce working capital and lower overall debt. The Company will consolidate all of its U.S. fiber production to its Palmetto plant, located in Darlington, South Carolina and close the fiber capacity located at its Johnsonville, South Carolina facility. The Company expects to sell its Material Recycling Division, which converts post-consumer PET bottles to flake and certain equipment used to produce Wellstrand, a specialty coarse denier fiber, both located at its Johnsonville facility. All of the actions are expected to result in a pre-tax non-cash charge of $30 million to $35 million in the third quarter of 2006. Joseph C. Tucker, vice president of the Fiber and Recycled Products Group, stated, "We will continue to meet our Johnsonville customers' requirements for high quality fiberfill from our Palmetto plant which has the capacity to produce 500 million pounds of polyester staple fiber annually." Thomas M. Duff, chairman and chief executive officer, stated, "Consolidating our U.S. fiber production is expected to increase operating income and reduce working capital. We will be able to operate one fiber facility at close to full capacity rather than operating two under-utilized facilities. This will allow us to lower our overall costs and remain more competitive in our domestic fiber operations. This decision is not a reflection on the dedication or abilities of our Johnsonville employees." The Company also disclosed that it is exploring strategic alternatives for its European fiber and PET resin businesses. Mr. Duff stated, "We are reviewing the performance of these businesses and exploring strategic alternatives with the goal of improving our overall corporate value." Wellman, Inc. manufactures and markets high-quality polyester products, including PermaClear(R) brand PET (polyethylene terephthalate) packaging resin and Fortrel(R) brand polyester fiber. One of the world's largest PET plastic recyclers, Wellman utilizes a significant amount of recycled raw materials in its manufacturing operations. * * * Wellman carry Standard & Poor's Ratings Services' 'B+' corporate credit rating. WINDSOR QUALITY: Moody's Assigns Loss-Given-Default Ratings ----------------------------------------------------------- In connection with Moody's Investors Service's implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S. Consumer Products, Beverage, Toy, Natural Product Processors, Packaged Food Processors, and Agricultural Cooperative sectors, the rating agency confirmed its B1 Corporate Family Rating for Windsor Quality Food Co. Ltd. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans facilities: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Sr. Sec. Revolving Credit Facility Due 2009 B1 Ba3 LGD3 38% Sr. Sec. Term Loan A Due 2009 B1 Ba3 LGD3 38% Sr. Sec. Term Loan B Due 2010 B1 Ba3 LGD3 38% Moody's current long-term credit ratings are opinions about expected credit loss, which incorporate both the likelihood of default and the expected loss in the event of default. The LGD rating methodology will disaggregate these two key assessments in long-term ratings. The LGD rating methodology will also enhance the consistency in Moody's notching practices across industries and will improve the transparency and accuracy of Moody's ratings as its research has shown that credit losses on bank loans have tended to be lower than those for similarly rated bonds. Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha- numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations. Loss-given-default assessments are assigned to individual rated debt issues -- loans, bonds, and preferred stock Moody's opinion of expected loss are expressed as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be 90% - 100%). Houston, Tex.-based Windsor Quality Food Company Ltd. -- http://www.windsorfoods.com/-- manufactures frozen foods offering Italian cuisine, Pan-Asian appetizers, Southwestern foods, Mexican mainstays, and appetizers. The Company's products includes Bernardi(R), Golden Tiger(R), The Original Chili Bowl(R), Jose Ole(R), Posada(R), Whitey's(R) Chili, Cripple Creek(R), and Fred's for Starters(R). WINN-DIXIE: Court Okays Assumption of 16 Store Leases ----------------------------------------------------- The Honorable Jerry A. Funk of the U.S. Bankruptcy Court for the Middle District of Florida authorizes Winn-Dixie Stores, Inc., and its debtor-affiliates to assume the leases for Store Nos. 2, 81, 167, 218, 222, 243, 250, 279, 359, 375, 631, 777, 1537, 2211, 2267, and 2289, effective as of the effective date of their Joint Plan of Reorganization. The Court fixes the cure amounts for the assumed leases not subject to cure objections by landlords. Judge Funk orders the Debtors to pay on the Effective Date the cure amounts due to landlords who filed cure objections. If the parties are unable to resolve the cure objections consensually, the Debtors are directed to set the objections for hearing before the Court. The Debtors' request and the cure and assumption objections filed by the landlords for Store Nos. 153, 231, 281, 426, 454, 460, 556, 698, 2258, 2301, 2311, and 2348 will be treated by a separate Court order. The Court continues the hearing on the Debtors' request with respect to the leases of Store Nos. 637, 651, 656, 660, and 737 to Sept. 21, 2006. Judge Funk clarifies that if the Effective Date does not occur, the Court Order will be null and void. 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 527 stores in Florida, Alabama, Louisiana, Georgia, and Mississippi. 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. 52; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) WINN-DIXIE: Ct. OKs Rejection of Store # 1059 Lease as of Aug. 31 ----------------------------------------------------------------- The Honorable Jerry A. Funk of the U.S. Bankruptcy Court for the Middle District of Florida authorized Winn-Dixie Stores, Inc., and its debtor-affiliates to reject their lease on Store No. 1059 as of Aug. 31, 2006. Judge Funk directs the landlord, Windward Partners IV, LP, to file any claims resulting from the rejection of the Store No. 1059 Lease by Sept. 30, 2006. As reported in the Troubled Company Reporter on Aug. 28, 2006, Winn-Dixie Stores, Inc., and Windward Partners IV, LP, were parties to a lease dated July 29, 1994, for the Debtors' Store No. 1059 located in Taylors, South Carolina. Pursuant to the Lease, Winn-Dixie pays Windward $422,000 in rent each year. In August 2003, Winn-Dixie subleased the Premises to Pro-Fit Management, Inc. Under the Sublease, Pro-Fit is required to pay Winn-Dixie monthly rent at graduated rates between $100,000 and $250,000 a year. After Winn-Dixie's bankruptcy filing, Pro-Fit failed to pay the rent so Winn-Dixie terminated the Sublease effective August 8, 2006. However, Pro-Fit remained in possession of the Premises. According to Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, in Jacksonville, Florida, the Debtors no longer need the store and that even when paid by Pro-Fit, the rent is not sufficient to cover the payments due under the Lease. Rejection of the Lease will save the Debtors approximately $422,000 a year. 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 527 stores in Florida, Alabama, Louisiana, Georgia, and Mississippi. 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. 52; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * A. Kintzinger Joins Public Finance Practice at Hunton & Williams ------------------------------------------------------------------ Hunton & Williams LLP disclosed that national municipal bond lawyer Andrew R. Kintzinger has joined the firm as Counsel with its public finance practice. Mr. Kintzinger, whose practice includes the federal securities and tax laws applicable to municipal bonds, will be based in the firm's District of Columbia office. "In recent years the IRS and SEC have substantially increased regulation and rule enforcement for municipal bonds," said John O'Neill, who co-heads the firm's public finance practice. "Drew is a first-rate lawyer who enjoys a national reputation among the public finance bar and the municipal investment banking community. He is well-known to the regulators at the IRS and the SEC, having represented a myriad of clients in matters before each agency." Mr. Kintzinger joined Hunton & Williams from Preston Gates & Ellis, Seattle, Washington. He earned his J.D. at the University of Iowa College of Law, where he was articles editor of the Iowa Law Review, and his A.B. at Dartmouth College. Mr. Kintzinger served as President of The National Association of Bond Lawyers from 1994 to 1995 and is a member of the editorial board for its Federal Securities Laws of Municipal Bonds Deskbook. He has been a frequent moderator and speaker at NABL education programs. Mr. Kintzinger will take a leading role in Hunton & Williams municipal securities regulatory and enforcement practice and special tax representations practice in the Washington, D.C. office. He joins Hunton & Williams senior bond partners William McBride and Dean Pope, each a past president of the National Association of Bond Lawyers, in serving clients with special needs related to public finance and tax-exempt bonds. Listed in the "Red Book" of municipal bond attorneys for more than 40 years, Hunton & Williams ranks among the most active law firms in the issuance of tax-exempt securities. Its lawyers have advised states, local governments, housing agencies and special authorities on virtually every kind of borrowing available to public bodies, including variable rate, credit enhanced and short- term transactions. Its geographic presence in nine states, including the District of Columbia and the firm's recent opening of a California office, has allowed us to serve as bond, underwriter's tax or disclosure counsel on transactions in approximately 40 states, D.C. and the U.S. Virgin Islands. In the Mid-Year Review 2006 bond counsel rankings published in the August edition of The Bond Buyer, Hunton & Williams was ranked #2 in the Southeast for all publicly offered issues, as well as #3 nationally for competitive sales. About Hunton & Williams Hunton & Williams LLP provides legal services to corporations, financial institutions, governments and individuals, as well as to a broad array of other entities. Since our establishment more than a century ago, Hunton & Williams has grown to 850 attorneys serving clients in 100 countries from 18 offices around the world. While our practice has a strong industry focus on energy, financial services and life sciences, the depth and breadth of our experience extends to more than 60 separate practice areas, including bankruptcy and creditors rights, commercial litigation, corporate transactions and securities law, intellectual property, international and government relations, regulatory law, products liability, and privacy and information management. * NatCity Investments buys SSG Capital Advisors ----------------------------------------------- NatCity Investments, Inc., the broker dealer subsidiary of National City Corporation (NYSE:NCC) the nation's ninth-largest bank, has acquired the investment banking assets of SSG Capital Advisors L.P. SSG's clients will continue to receive the high level of service and results that the principals of SSG have prided themselves in providing. SSG has consistently ranked among the nation's 10 largest restructuring focused investment banks by the number of transactions it has made in each of the last five years, as ranked by The Deal. SSG president Mark E. Chesen and managing director J. Scott Victor have been named senior managing directors at National City, where they will report to Sean Dorsey, Senior Managing Director and Head of Investment Banking, and will be joined by all of their SSG colleagues at NatCity Investments, Inc. "We don't want to change these guys. We love what they do. SSG has built a well respected national restructuring practice" Sean Dorsey said. "We're building an investment bank brick by brick", he said. "National City would likely make acquisitions of other niche investment banks. National City's existing investment- banking business, focuses primarily on representing profitable middle market companies, and complements SSG's focus on representing companies facing financial challenges", he said. National City offers "SSG the ability to dramatically expand it's geographical footprint," Mr. Chesen said and Mr. Victor added, "it allows us to market our services to National City's existing client base of over 20,000 companies throughout the Midwest". For further information contact: Senior Managing Directors and Co-Heads, Special Situations Group * Mark E. Chesen Tel: (610) 940-5801 * J. Scott Victor Tel: (610) 940-5802 * Upcoming Meetings, Conferences and Seminars --------------------------------------------- September 28, 2006 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS West Coast Plan of Reorganization Conference The Olympic Collection Banquet, Los Angeles, CA Contact: http://www.airacira.org/ September 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION Quarterly Networking Luncheon East Bank Club, Chicago, IL Contact: 815-469-2935 or www.turnaround.org October 3, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Organization of Women Networking Event/ Fundraiser TBD, Philadelphia, PA Contact: 215-657-5551 or http://www.turnaround.org/ October 3, 2006 TURNAROUND MANAGEMENT ASSOCIATION 3rd Annual Golf Outing Fox Chapel Golf Club, Pittsburgh, PA Contact: 412-644-8794 or http://www.turnaround.org/ October 5, 2006 TURNAROUND MANAGEMENT ASSOCIATION Commercial Lenders Breakfast Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 5, 2006 TURNAROUND MANAGEMENT ASSOCIATION Panel & Breakfast Meeting: Financial Fraud Center Club, Baltimore, MD Contact: http://www.turnaround.org/ October 5, 2006 TURNAROUND MANAGEMENT ASSOCIATION Negotiations Workshop Standard Club, Chicago, IL Contact: http://www.turnaround.org/ October 6, 2006 AMERICAN BANKRUPTCY INSTITUTE Bankruptcy 2006: Views from the Bench Georgetown University Law Center, Washington, DC Contact: 1-703-739-0800; http;//www.abiworld.org/ October 10, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Center Club, Baltimore, Maryland Contact: 703-912-3309 or http://www.turnaround.org/ October 11, 2006 TURNAROUND MANAGEMENT ASSOCIATION Professional Development Meeting Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION UTS Fundamentals of Turnaround Management Melbourne, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 11-14, 2006 TURNAROUND MANAGEMENT ASSOCIATION 2006 Annual Conference Milleridge Cottage, Long Island, New York Contact: 312-578-6900; http://www.turnaround.org/ October 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION UTS Fundamentals of Turnaround Management Mecure Hotel - Haymarket, Sydney, Australia Contact: http://www.turnaround.org/ October 16, 2006 AMERICAN BANKRUPTCY INSTITUTE A Year After BAPCPA Georgetown University Law Center, Washington, DC Contact: 1-703-739-0800; http://www.abiworld.org/ October 17, 2006 TURNAROUND MANAGEMENT ASSOCIATION Updates on the New Bankruptcy Law Kansas City, Missouri Contact: http://www.turnaround.org/ October 18-19, 2006 EUROMONEY 2nd Annual Latin America Syndicated Loans Conference JW Marriott Hotel, Miami, FL Contact: http://www.euromoneyplc.com/ October 19, 2006 TURNAROUND MANAGEMENT ASSOCIATION TMA of Nevada's 1st Breakfast Meeting The A,B,C's of Valuing and Selling a Business Palace Station, Las Vegas, NV Contact: http://www.turnaround.org/ October 19, 2006 TURNAROUND MANAGEMENT ASSOCIATION Navigating the Potholes and Speed Bumps on Today's Economic Highway Waller Lansden Dortch & Davis Nashville, TN Contact: http://www.turnaround.org/ October 19, 2006 BEARD AUDIO CONFERENCES Surviving the Digital Deluge: Best Practices in e-Discovery and Records Management for Bankruptcy Practitioners and Litigators Contact: 240-629-3300; http://www.beardaudioconferences.com/ October 19, 2006 TURNAROUND MANAGEMENT ASSOCIATION Billards Networking Night - Young Professionals TBA, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ October 25, 2006 BEARD AUDIO CONFERECES Deepening Insolvency - Widening Controversy: Current Risks, Latest Decisions, Review Risks, Examine Latest Decisions Affecting Directors, Advisors and Lenders of Troubled Companies Contact: http://www.beardaudioconferences.com/ 240-629-3300 October 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Hedge Funds - Expanded Financing Opportunities in Business Turnarounds Arizona Contact: http://www.turnaround.org/ October 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Speaker Series #3 TBA, Calgary, Alberta Contact: 403-294-4954 or http://www.turnaround.org/ October 26, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Speaker Series #3 TBA, Calgary, Alberta Contact: 403-294-4954 or http://www.turnaround.org/ October 27, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast with Coach Dan Reeves Westin Buckhead, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ October 28, 2006 TURNAROUND MANAGEMENT ASSOCIATION BK/TMA Golf Tournament Orange Tree Golf Resort, AZ Contact: 623-581-3597 or http://www.turnaround.org/ October 30-31, 2006 Distressed Debt Summit: Preparing for the Next Default Cycle Financial Research Associates LLC Helmsley Hotel, New York, NY Contact: http://www.frallc.com/ October 31, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ October 31 - November 1, 2006 INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION IWIRC Annual Conference San Francisco, California Contact: http://www.iwirc.com/ November 1, 2006 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS AIRA/NCBJ Dessert Reception Marriott, San Francisco, CA Contact: 415-896-1600 or http://www.airacira.org/ November 1, 2006 TURNAROUND MANAGEMENT ASSOCIATION Halloween Isn't Over! - Ghosts of turnarounds past who remind you about what you should have done differently Portland, Oregon Contact: http://www.turnaround.org/ November 1-4, 2006 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges San Francisco, California Contact: http://www.ncbj.org/ November 2, 2006 TURNAROUND MANAGEMENT ASSOCIATION TMA UK Annual Conference Millennium Gloucester Hotel, London, UK Contact: http://www.turnaround.org/ November 2-3, 2006 BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES Third Annual Conference on Physician Agreements & Ventures Successful Strategies for Medical Transactions and Investments The Millennium Knickerbocker Hotel - Chicago Contact: 903-595-3800; 1-800-726-2524; http://www.renaissanceamerican.com/ November 3, 2006 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS AIRA/NCBJ Breakfast Program Marriott, San Francisco, CA Contact: 415-896-1600 or http://www.airacira.org/ November 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast Marriott, Bridgewater, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ November 7-8, 2006 EUROMONEY 5th Annual Distressed Debt Investment Symposium Hyatt Regency, London, UK Contact: http://www.euromoneyplc.com/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Marriott Tyson's Corner, Vienna, Virginia Contact: 703-912-3309 or http://www.turnaround.org/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION TMA Australia National Conference Sydney, Australia Contact: http://www.turnaround.org/ November 9, 2006 TURNAROUND MANAGEMENT ASSOCIATION Webinar "Second Lien Financing or Investing: Are There Opportunities for You?" TMA HQ, Chicago, IL Contact: http://www.turnaround.org/ November 14, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Program St. Louis, Missouri Contact: 815-469-2935 or http://www.turnaround.org/ November 14, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Program - Cost Containment Strategies St. Louis, MO Contact: http://www.turnaround.org/ November 14, 2006 TURNAROUND MANAGEMENT ASSOCIATION Holiday Cocktail Reception Honoring the Bankruptcy Benches of the Southern & Eastern Districts of New York and New Jersey Association of the Bar of the City of New York New York, NY Contact: http://www.turnaround.org/ November 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION Joint Reception with NYIC/NYTMA TBA, New York Contact: 908-575-7333 or http://www.turnaround.org/ November 15, 2006 LI TMA Formal Event TMA Australia National Conference Long Island, New York Contact: http://www.turnaround.org/ November 15, 2006 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner Citrus Club, Orlando, Florida Contact: 561-882-1331 or http://www.turnaround.org/ November 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Bankruptcy Judges Panel Duquesne Club, Pittsburgh, Pennsylvania Contact: http://www.turnaround.org/ November 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Dinner Program TBA, Seattle, Washington Contact: 503-223-6222 or http://www.turnaround.org/ November 16-17, 2006 STRATEGIC RESEARCH INSTITUTE 8th Annual West Distressed Debt Investing Forum Venetian Resort Hotel Casino, Las Vegas, NV Contact: http://www.srinstitute.com November 17, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast with Harry Nolan, Author of Airline without a Pilot - Lessons in Leadership Westin Buckhead, Atlanta, GA Contact: http://www.turnaround.org/ November 23, 2006 TURNAROUND MANAGEMENT ASSOCIATION Martini Party Vancouver, British Columbia Contact: 403-294-4954 or http://www.turnaround.org/ November 27-28, 2006 BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES Thirteenth Annual Conference on Distressed Investing Maximizing Profits in the Distressed Debt Market The Essex House Hotel - New York Contact: 903-595-3800; 1-800-726-2524; http://www.renaissanceamerican.com/ November 28, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Centre Club, Tampa, FL Contact: 561-882-1331 or http://www.turnaround.org/ November 28, 2006 TURNAROUND MANAGEMENT ASSOCIATION Joint TMA Florida/ACG Tampa Bay Luncheon Buying and Selling a Troubled Company Centre Club, Tampa, FL Contact: http://www.turnaround.org/ November 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION Special Program TBA, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ November 29, 2006 TURNAROUND MANAGEMENT ASSOCIATION Turnaround Industry Trends Jasna Polana, Princeton, NJ Contact: http://www.turnaround.org/ November 30-December 2, 2006 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Hyatt Regency at Gainey Ranch, Scottsdale, Arizona Contact: 1-703-739-0800; http://www.abiworld.org/ December 6, 2006 TURNAROUND MANAGEMENT ASSOCIATION Holiday Dinner Portland, Oregon Contact: 503-223-6222 or http://www.turnaround.org/ December 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Networking Breakfast The Newark Club, Newark, New Jersey Contact: 908-575-7333 or http://www.turnaround.org/ December 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION LI TMA Holiday Party TBA, Long Island, New York Contact: 631-251-6296 or http://www.turnaround.org/ December 13, 2006 TURNAROUND MANAGEMENT ASSOCIATION Christmas Function GE Commercial Finance, Sydney, Australia Contact: 0438 653 179 or http://www.turnaround.org/ December 20, 2006 TURNAROUND MANAGEMENT ASSOCIATION Holiday Extravaganza - TMA, AVF & CFA Georgia Aquarium, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ January 11, 2007 TURNAROUND MANAGEMENT ASSOCIATION Lender's Panel University Club, Jacksonville, FL Contact: http://www.turnaround.org/ January 12, 2007 TURNAROUND MANAGEMENT ASSOCIATION Annual Lender's Panel Breakfast Westin Buckhead, Atlanta, GA Contact: http://www.turnaround.org/ January 17, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ January 17-19, 2007 TURNAROUND MANAGEMENT ASSOCIATION Distressed Investing Conference Wynn, Las Vegas, NV Contact: http://www.turnaround.org/ February 8-11, 2007 TURNAROUND MANAGEMENT ASSOCIATION Certified Turnaround Professional (CTP) Training NY/NJ Contact: http://www.turnaround.org/ February 22, 2007 TURNAROUND MANAGEMENT ASSOCIATION TMA PowerPlay - Atlanta Thrashers Philips Arena, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ February 25-26, 2007 NORTON INSTITUTES Norton Bankruptcy Litigation Institute Marriott Park City, UT Contact: http://www2.nortoninstitutes.org/ February 2007 AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium San Juan, Puerto Rico Contact: 1-703-739-0800; http://www.abiworld.org/ March 15, 2007 TURNAROUND MANAGEMENT ASSOCIATION Martini Madness Cocktail Reception with Geraldine Ferraro Westin Buckhead, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ March 15-18, 2007 NATIONAL ASSOCIATION OF BANKRUTPCY TRUSTEES NABT Spring Seminar Ritz-Carlton Buckhead, Atlanta, GA Contact: http://www.NABT.com/ March 21, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ March 27-31, 2007 TURNAROUND MANAGEMENT ASSOCIATION Spring Conference Four Seasons Las Colinas, Dallas, Texas Contact: http://www.turnaround.org/ March 29-31, 2007 ALI-ABA Chapter 11 Business Reorganizations Scottsdale, Arizona Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/ April 11-15, 2007 AMERICAN BANKRUPTCY INSTITUTE ABI Annual Spring Meeting J.W. Marriott, Washington, DC Contact: 1-703-739-0800; http://www.abiworld.org/ April 12, 2007 TURNAROUND MANAGEMENT ASSOCIATION Luncheon University Club, Jacksonville, FL Contact: 561-882-1331 or http://www.turnaround.org/ April 20, 2007 TURNAROUND MANAGEMENT ASSOCIATION Breakfast meeting with Chapter President, Bruce Sim Westin Buckhead, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ May 14, 2007 TURNAROUND MANAGEMENT ASSOCIATION Annual TMA Atlanta Golf Outing White Columns, Atlanta, GA Contact: 678-795-8103 or http://www.turnaround.org/ May 16, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ June 6-9, 2007 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS 23rd Annual Bankruptcy & Restructuring Conference Westin River North, Chicago, Illinois Contact: http://www.airacira.org/ June 14-17, 2007 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort, Traverse City, Michigan Contact: 1-703-739-0800; http://www.abiworld.org/ June 28 - July 1, 2007 NORTON INSTITUTES Norton Bankruptcy Litigation Institute Jackson Lake Lodge, Jackson Hole, WY Contact: http://www2.nortoninstitutes.org/ July 12, 2007 TURNAROUND MANAGEMENT ASSOCIATION Luncheon University Club, Jacksonville, FL Contact: 561-882-1331 or www.turnaround.org July 12-15, 2007 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Marriott, Newport, RI Contact: 1-703-739-0800; http://www.abiworld.org/ July 18, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ September 19, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ October 10-13, 2007 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Orlando, Florida Contact: http://www.ncbj.org/ October 11, 2007 TURNAROUND MANAGEMENT ASSOCIATION Luncheon University Club, Jacksonville, FL Contact: 561-882-1331 or http://www.turnaround.org/ October 16-19, 2007 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Copley Place, Boston, Massachusetts Contact: 312-578-6900; http://www.turnaround.org/ December 6-8, 2007 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Westin Mission Hills Resort, Rancho Mirage, California Contact: 1-703-739-0800; http://www.abiworld.org/ December 19, 2007 TURNAROUND MANAGEMENT ASSOCIATION South Florida Dinner TBA, South FL Contact: 561-882-1331 or http://www.turnaround.org/ January 10, 2008 TURNAROUND MANAGEMENT ASSOCIATION Luncheon University Club, Jacksonville, FL March 25-29, 2008 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference Ritz Carlton Grande Lakes, Orlando, Florida Contact: http://www.turnaround.org/ June 4-7, 2008 ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS 24th Annual Bankruptcy & Restructuring Conference JW Marriott Spa and Resort, Las Vegas, NV Contact: http://www.airacira.org/ September 24-27, 2008 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Scottsdale, Arizona Contact: http://www.ncbj.org/ October 28-31, 2008 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Copley Place, Boston, Massachusetts Contact: 312-578-6900; http://www.turnaround.org/ October 5-9, 2009 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Desert Ridge, Phoenix, Arizona Contact: 312-578-6900; http://www.turnaround.org/ 2009 (TBA) NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges Las Vegas, Nevada Contact: http://www.ncbj.org/ October 4-8, 2010 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention JW Marriott Grande Lakes, Orlando, Florida Contact: http://www.turnaround.org/ 2010 (TBA) NATIONAL CONFERENCE OF BANKRUPTCY JUDGES National Conference of Bankruptcy Judges New Orleans, Louisiana Contact: http://www.ncbj.org/ BEARD AUDIO CONFERENCES Coming Changes in Small Business Bankruptcy Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Distressed Real Estate under BAPCPA Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES High-Yield Opportunities in Distressed Investing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Fundamentals of Corporate Bankruptcy and Restructuring Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Reverse Mergers - the New IPO? Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Dana's Chapter 11 Filing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Employee Benefits and Executive Compensation under the New Code Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Validating Distressed Security Portfolios: Year-End Price Validation and Risk Assessment Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Changing Roles & Responsibilities of Creditors' Committees Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Calpine's Chapter 11 Filing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Healthcare Bankruptcy Reforms Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES Changes to Cross-Border Insolvencies Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com/ BEARD AUDIO CONFERENCES The Emerging Role of Corporate Compliance Panels Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com BEARD AUDIO CONFERENCES Privacy Rights, Protections & Pitfalls in Bankruptcy Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com BEARD AUDIO CONFERENCES High-Yield Opportunities in Distressed Investing Audio Conference Recording Contact: 240-629-3300; http://www.beardaudioconferences.com The Meetings, Conferences and Seminars column appears in the Troubled Company Reporter each Wednesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marie Therese V. Profetana, Robert Max Victor M. Quiblat II, Shimero R. Jainga, Joel Anthony G. Lopez, Melvin C. Tabao, Rizande B. Delos Santos, Cherry A. Soriano-Baaclo, Christian Q. Salta, Jason A. Nieva, Lucilo M. Pinili, Jr., Tara Marie A. Martin and Peter A. Chapman, Editors. Copyright 2006. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $725 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***