/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/061011.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, October 11, 2006, Vol. 10, No. 242 Headlines 155 EAST TROPICANA: Moody's Assigns Loss-Given-Default Rating ABITIBI-CONSOLIDATED: Poor Market Conditions Prompt Mill Closures ADELPHIA COMMS: Panel Balks at Noteholders' Plea to Unseal Record ADELPHIA COMMS: Parties Balk at Bank Lenders' Case Conversion Plea ADVANCED MEDICAL: Fitch Affirms and Withdraws Low-B Ratings AMAZON.COM: Moody's Assigns Loss-Given-Default Ratings AMERICAN CREDIT: Selling Roanoke Personal Properties for $845,867 AMERICAN CREDIT: Brings In McGladrey & Pullen as Accountants AMERISTAR CASINOS: Moody's Assigns Loss-Given-Default Rating AMKOR TECH: Files Form 10-Q and Cures Alleged Defaults on Debts ARMSTRONG WORLD: Five Panel Professionals Want Fees Allowed ARMSTRONG WORLD: Sea-Pac Wants Claim Objection Overruled ARMSTRONG WORLD: Distributes $407 Million to Class 6 Creditors AZTAR CORPORATION: Moody's Assigns Loss-Given-Default Rating BAKER & TAYLOR: Moody's Assigns Loss-Given-Default Rating BALLY TOTAL: S&P Holds CCC Rating and Removes Developing Watch BCBG MAX: Moody's Assigns Loss-Given-Default Ratings BERRY PETROLEUM: S&P Pates Proposed $200 Million Senior Notes at B BLB MANAGEMENT: Moody's Assigns Loss-Given-Default Rating BLOCKBUSTER INC: Moody's Assigns Loss-Given-Default Ratings CABLEVISION SYSTEMS: Sr. Notes Exchange Offer Stretched to Nov. 2 CABLEVISION SYSTEM: Dolan's Offer Cues Moody's to Review Ratings CABLEVISION SYSTEMS: Dolan Buyout Offer Prompts Fitch's Neg. Watch CATHOLIC CHURCH: Parishioners Can Hold Claims Against Portland CATHOLIC CHURCH: Davenport Diocese Files for Bankruptcy Protection CATHOLIC CHURCH: Diocese of Davenport Chapter 11 Case Summary CINEMARK INC: Century Acquisition Closing Cues S&P to Cut Ratings COMPLETE RETREATS: Selects Donlin Recano as Claims Agent COMPLETE RETREATS: Wants Removal Period Extended to January 19 CSC HOLDINGS: Dolan Family's Offer Cues Moody's to Review Ratings DANA CORP: Martinez Group Wants $259,041 Administrative Claim Paid DANA CORP: Patti Organ Wants Stay Lifted to Pursue Insurance DELTA AIR: Parties Object to Lease Claims Objection Process DELTA AIR: Aircraft Creditors Balk at Claims Objection Procedures DIRECTED ELECTRONICS: Polk Audio Buy Cues S&P to Lower Ratings EATON VANCE: S&P Affirms BB- Rating on Class D Notes E.SPIRE COMMS: Ch. 7 Trustee Hires Rawle & Henderson as Co-Counsel FEDERAL-MOGUL: Insurers Want Dresser Case Heard in State Court FEDERAL-MOGUL: Underwriters to Reply on Travelers' Objection FLAGSTONE CBO: Fitch Holds BB Rating on $10.3 Mil. Class B-1 Notes FLYI INC: Judge Walrath Adjourns Disclosure Statement Hearing FLYI INC: Wants Removal Period Extended to January 31 FOAMEX INT'L: Exclusive Plan Filing Period Extended to November 15 FORD MOTOR: Could be Next in Renault-Nissan's Quest for Alliance GENERAL MOTORS: S&P Retains Watch After Nissan-Renault Talks End GOODING'S SUPERMARKETS: Files Amended Disclosure Statement GORDON MEISEL: Case Summary & Nine Largest Unsecured Creditors GREENWICH CAPITAL: S&P Affirms Low-B Ratings on Three Certificates GREYSTONE LOGISTICS: Murrell Hall Raises Going Concern Doubt GTM HOLDINGS: S&P Junks Rating on $105 Million 2nd-Lien Term Loan INTERSTATE BAKERIES: Sells Portland Asset to Sierra Construction INTERSTATE BAKERIES: Wants Some Transfers to JPMorgan Avoided INTERSTATE BAKERIES: Claim Purchasers Form Ad Hoc Committee JDA SOFTWARE: Moody's Assigns Loss-Given-Default Rating JEAN COUTU: Takes $120MM Impairment Loss in FY2007 Second Quarter KARA HOMES: Case Summary & 172 Largest Unsecured Creditors KARA HOMES: Magyar Bank Clarifies $5.135 Million Security Loan KERR-MCGEE CORP: Moody's Lifts Ratings on Notes and Debentures LAKESIDE HEIGHTS: Case Summary & 19 Largest Unsecured Creditors LB-UBS COMMERCIAL: S&P Holds Low-B Ratings on Six Certificates LONDON FOG: Pays $400,00 Break Up Fee to LF Joint Venture MADE2MANAGE SYSTEMS: Moody's Assigns Loss-Given-Default Rating MAGMA CDO: Moody's Lifts $14.5 Million Sub. Notes' Rating to B3 MARSH SUPERMARKETS: Acquisition Cues Moody's to Withdraw Ratings MEDICALCV INC: Posts $4 Million Net Loss in First Quarter MERIDIAN AUTOMOTIVE: Files Revised Fourth Amended Plan in Delaware MERIDIAN AUTOMOTIVE: Committee Objects to Disclosure Statement MERIDIAN AUTOMOTIVE: Committee Objects to Solicitation Procedures MESABA AVIATION: May Shut Down If Employees Refuse Pay Cuts METROPCS WIRELESS: Moody's Junks Senior Unsecured Bond's Rating MICHAELS STORES: S&P Rates Planned $2.4 Billion Term Loan at B- MILLS CORP: Completes $988 Mil. Asset Sale to Ivanhoe Cambridge NATIONAL PROCESSING: Moody's Rates $140 Mil. Senior Loan at Caa2 NEOPLAN USA: Files Amended Disclosure Statement in Delaware NORTHWEST AIRLINES: 3V Capital & Pierce Want to File $2.07MM Claim NORTHWEST AIRLINES: Okays Extension of MAC's Section 1110 Period NOVA CDO: S&P Junks Ratings on Class C Notes NUANCE COMMS: Moody's Assigns Loss-Given-Default Rating OMEGA POLYMER: Selling all Assets to Resilience Capital ONEIDA LTD: April 29 Stockholders' Deficit Widens to $43.5 Million OWENS CORNING: Torrejon Wants to Intervene in Bankruptcy Case PEABODY ENERGY: S&P Rates $900 Mil. Senior Unsecured Notes at BB PROTECTION ONE: Fitch Withdraws Junk Rating on Sr. Sub. Debt RAFAELLA APPAREL: Moody's Assigns Loss-Given-Default Rating RAINBOW NAT'L: Dolan Family's Offer Cues Moody's to Review Ratings REFCO INC: Files Amended Plan and Disclosure Statement in New York REFCO INC: FXCM Says Disclosure Statement in Silent on Interest SCOTTS MIRACLE-GRO: Moody's Assigns Loss-Given-Default Rating SIRVA INC: S&P Withdraws Low-B Ratings and Removes Negative Watch SPANSION LLC: S&P Rates New $400 Million Term Loan at B+ SPECIALTYCHEM PRODUCTS: Wants to Sell ChemDesign's Assets SPECTRUM BRANDS: Moody's Assigns Loss-Given-Default Ratings STROBER ORGANIZATION: Moody's Assigns Loss-Given-Default Rating STRUCTURED ASSET: S&P Junks Rating on Class B-5 Loan TODD MCFARLANE: Files Amended Liquidation Plan in Arizona TODD MCFARLANE: Disclosure Statement Hearing Slated for November 9 TOWER RECORDS: Court Approves Retention of FTI Palladium TTM TECH: S&P Rates Proposed $240 Mil. Senior Facilities at BB- UNIVERSAL EXPRESS: Buying New Jersey Gasoline Assets for $42 Mil. USA COMMERCIAL: Disclosure Statement Hearing Scheduled on Nov. 13 USA COMMERCIAL: Exclusive Solicitation Period Intact Until Oct. 19 VERIDICOM INT'L: June 30 Stockholders' Deficit Widens to $4.3 Mil. VTEX ENERGY: July 31 Working Capital Deficit Tops $10 Million WESTERN APARTMENT: Rowell to Craft Traffic Assessment Report WESTERN APARTMENT: Gets Court Okay to Hire Scientific Consultant WHITE RIVER: Court Okays Marvin R. Moore as Mining Engineer WHITE RIVER: Wants to Expand Realization Advisor's Duties WINN-DIXIE: Major Creditors Approve Reorganization Plan * Timothy Porter Joins Proskauer Rose as Senior Counsel * Upcoming Meetings, Conferences and Seminars ********* 155 EAST TROPICANA: 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 gaming, lodging and leisure sectors, the rating agency confirmed its B3 Corporate Family Rating for 155 East Tropicana, LLC, as well as its B3 rating on the company's 8-3/4% Senior Secured Notes. Moody's assigned those debentures an LGD4 rating suggesting noteholders will experience a 57% 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%). 155 East Tropicana, LLC owns the Hotel San Remo Casino and Resort in Las Vegas, Nevada, which the company has begun to renovate and re-brand as Hooters Casino Hotel. The property is located one- half block from the intersection of Tropicana Avenue and Las Vegas Boulevard, a major intersection on the Las Vegas Strip. The Hotel San Remo currently features 711 hotel rooms and an approximately 24,000 square-foot casino. ABITIBI-CONSOLIDATED: Poor Market Conditions Prompt Mill Closures ----------------------------------------------------------------- Around 700 workers at Abitibi-Consolidated, Inc., are set to lose their jobs as the Canadian forestry company closes four of its paper mills on October 16, The Toronto Star reports. Yves Laflamme, Abitibi-Consolidated vice president, said in a report from The Star that weakening market conditions for lumber coupled with rising productions costs led to the closure decisions. CBC News relates that the four mills slated for closure are located in the regions of Abitibi-Temiscamingue, Lac Saint-Jean and the North Shore. In August, Abitibi-Consolidated disclosed the suspension of quarterly dividend payments as part of its efforts to reduce debt starting in 2007 as well as provide liquidity and improve profitability. Abitibi-Consolidated reported a $48 million operating profit for the second quarter of 2006, compared with an operating profit of $57 million for the same period in the prior year. The Company attributed lower operating profits in the 2006-second quarter to the strength of the Canadian dollar, lower prices in the wood products segment and higher cost of products sold in the commercial printing papers segment. According to Abitibi- Consolidated, the 10.8% appreciation of the Canadian dollar compared to the US dollar, is estimated to have had an unfavorable impact of $83 million on the quarterly operating results. About Abitibi-Consolidated Abitibi-Consolidated, Inc. -- http://www.abitibiconsolidated.com/ -- produces newsprint and commercial printing paper products from its 45 operating facilities. The Company also recycler newspapers and magazines, diverting approximately 1.9 million tonnes of waste paper from landfills annually * * * Moody's Investors Service affirmed its B1 Corporate Family Rating for Abitibi-Consolidated, Inc., in connection with its implementation of the new Probability-of-Default and Loss-Given- Default rating methodology for the North American Forest Products sector. Moody's placed LGD4 Loss-Given-Default ratings to 15 of the Company's loan and bond debt obligations, suggesting debt holders will experience a 57% loss in the event of a default. As reported in the Troubled Company Reporter on May 1, 2006, Dominion Bond Rating Service confirmed the ratings of Abitibi- Consolidated Inc., and Abitibi-Consolidated Company of Canada at BB (low). ADELPHIA COMMS: Panel Balks at Noteholders' Plea to Unseal Record ----------------------------------------------------------------- The Official Committee of Unsecured Creditors of Adelphia Communications Corporation's chapter 11 case and several parties- in-interest filed with the U.S. Bankruptcy Court for the Southern District of New York their objection to the request of the ACC Senior Noteholders to unseal the full record of the resolution process and the negotiations that led up to the ACOM Debtors' Fifth Amended Plan of Reorganization. Statements Supporting ACC Senior Noteholders Request Calyon New York Branch adopts and incorporates by reference the legal arguments pertaining solely to the unseal request by Aurelius Capital Management, LP; Catalyst Investment Management Co., LLC; Drawbridge Global Macro Advisors LLC; Drawbridge Special Opportunities Advisors, LLC; Elliot Associates, LP; Farallon Capital Management LLC; Noonday Asset Management LP; and Perry Capital LLC, as holders or investment advisors to holders of certain notes and debentures issued by Adelphia Communications Corporation. The Official Committee of Equity Security Holders agrees that the Court should unseal the record on plan issues and permit adjudication of the intercreditor disputes. Representing the Equity Committee, Gregory A. Blue, Esq., at Morgenstern Jacobs & Blue, LLC, in New York, contends that the time has come to unseal the full record of the resolution process and the negotiations that led up to the ACOM Debtors' Fifth Amended Plan of Reorganization. The Supreme Court in Consol. Rock, 312 U.S., has stated unequivocally that "[a]nything short of voluntary and honest disclosure [of financial information] obstructs the policy of Chapter 11 towards fair settlement through a negotiation process between informed interested parties." Objections To Noteholders' Request To Adjudicate Intercompany Disputes Marc Abrams, Esq., at Willkie Farr & Gallagher LLP, in New York, argues that the Court is not obligated to resume the resolution process nor would doing so serve the interest of any stakeholder because: (a) resumption of the resolution process is impractical, destructive of value, and a sub-optimal alternative to the proposed Fifth Amended Plan; (b) the Plan Agreement is a permissible and highly preferable alternative for resolving the intercreditor dispute; (c) the Debtors have complied in all respects with their neutrality obligations; and (d) whether the settlement contemplated by the Fifth Amended Plan is fair and reasonable or not are issues that can and will be addressed at a future confirmation hearing; it is not a basis to resume the resolution process now. Representing the ACC II Committee, an ad hoc committee comprised of holders of ACC Notes and Arahova Notes, Jeremy V. Richards, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP, in Los Angeles, California, asserts that there is no benefit to resume the Motion In Aid Process. The ACOM Debtors' Fifth Amended Plan of Reorganization embodies the resolution of the disputed issues that are subject of the MIA Process. "The idea that the MIA Process is a viable alternative to either the Fifth Amended Plan or any other settlement plan is unrealistic and untenable," Mr. Richards contends. Unless the Court is prepared to accept that the MIA Process requires that each and every disputed issue be litigated to a final and non-appealable judgment, the MIA Process must encompass the possibility of settlement. Representing the Ad Hoc Committee of FrontierVision Noteholders, Kenneth H. Eckstein, Esq., at Kramer Levin Naftalis & Frankel LLP, in New York, contends that the settlement contained in the Fifth Amended Plan: (a) does not violate the rights of the ACC Senior Noteholders, (b) was negotiated at arm's-length, and (b) should be sent out for a vote by creditors. Mr. Eckstein further argues that: -- the ACC Senior Noteholders are not successor to the Ad Hoc Committee of ACC Noteholders and does not have the right to litigate or settle the ACOM's intercompany claims; -- the ACOM Debtors and the Creditors Committee have standing to propose and solicit the Fifth Amended Plan; -- nothing in the Plan term sheet or Plan process has interfered with the due process rights of ACC Senior Noteholders; and -- the settlement does not "take" anything from anybody to benefit the FrontierVision Noteholders. Representing the Ad Hoc Committee of Arahova Noteholders, Gerard Uzzi, Esq., at White & Case LLP, in New York, asserts that the ACC Senior Noteholders are not the ACC Senior Noteholders Committee. The MIA Process identified certain "Deemed Participants," who were automatically included in the MIA Litigation. The list included the ACC Senior Noteholders Committee, represented by Hennigan, Bennett & Dorman LLP. The individual bondholders on the ACC Senior Noteholders Committee were not designated as Deemed Participants. Any other party-in-interest seeking to participate in the MIA Litigation could file a "Participation Request." The ACC Senior Noteholders, however, did not file the necessary Participation Request. Representing the Official Committee of Unsecured Creditors, David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, contends that unsealing the MIA record could severely mislead stakeholders and thus, taint the confirmation process. About Adelphia Communications Based in Coudersport, Pa., Adelphia Communications Corporation (OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest cable television company in the country. Adelphia serves customers in 30 states and Puerto Rico, and offers analog and digital video services, high-speed Internet access and other advanced services over its broadband networks. The Company and its more than 200 affiliates filed for Chapter 11 protection in the Southern District of New York on June 25, 2002. Those cases are jointly administered under case number 02-41729. Willkie Farr & Gallagher represents the ACOM Debtors. PricewaterhouseCoopers serves as the Debtors' financial advisor. Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP represent the Official Committee of Unsecured Creditors. Adelphia Cablevision Associates of Radnor, L.P., and 20 of its affiliates, collectively known as Rigas Manged Entities, are entities that were previously held or controlled by members of the Rigas family. In March 2006, the rights and titles to these entities were transferred to certain subsidiaries of Adelphia Cablevision, LLC. The RME Debtors filed for chapter 11 protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642). Their cases are jointly administered under Adelphia Communications and its debtor-affiliates chapter 11 cases. (Adelphia Bankruptcy News, Issue Nos. 149; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ADELPHIA COMMS: Parties Balk at Bank Lenders' Case Conversion Plea ------------------------------------------------------------------ The Official Committee of Unsecured Creditors to Adelphia Communications Corporation's chapter 11 case and several parties- in-interest filed with the U.S. Bankruptcy Court for the Southern District of New York their objection to the request of several bank lenders to terminate the exclusive periods of the Debtor and its debtor-affiliates or to convert the Debtors' cases to a liquidation proceeding under Chapter 7 of the Bankruptcy Code. As reported in the Troubled Company Reporter on Aug. 29, 2006 several bank lenders ask the Court to terminate the exclusive periods of the Debtor and its debtor-affiliates to allow the banks to file and solicit acceptance of a Chapter 11 plan or plans for the Debtors. In the alternative, the Bank Lenders want the Debtors' cases converted to a liquidation proceeding under Chapter 7 of the Bankruptcy Code. Objections Several parties-in-interest filed with the Court their objections to several bank lenders' request to terminate the Operating Company Debtors' exclusive periods and to Calyon New York Branch and The Bank of New York's request to convert the Obligor Debtors' cases to Chapter 7: (a) Highfields Capital Management and Tudor Investment Corporation; (b) W.R. Huff Asset Management Co., L.L.C; (c) the ACC II Committee, an ad hoc committee comprised of holders of ACC Notes and Arahova Notes, namely, Murray Capital Management, Inc.; Stark & Roth; Franklin Mutual Advisors, LLC; Citadel Limited Partnership; Avenue Capital Management; Citigroup Financial Products, Inc.; HBK Investments, L.P.; Varde Partners, Inc.; and Lionhart Investments, Ltd.; (d) the Official Committee of Unsecured Creditors; (e) the Ad Hoc Adelphia Trade Claims Committee; (f) the Ad Hoc Committee of FrontierVision Noteholders; (g) the Official Committee of Equity Security Holders; (h) JPMorgan Chase Bank, N.A.; (i) the Ad Hoc Committee of Arahova Noteholders; (j) the ACOM Debtors; and (k) the Ad Hoc Committee of FrontierVision Noteholders. Generally, the parties assert that the Court should preserve the ACOM Debtors' exclusivity at this critical juncture of their Chapter 11 cases. The Parties believe that terminating the exclusivity will only cause further expense and delay, and jeopardizes the consummation of the ACOM Debtors' Fifth Amended Plan of Reorganization. Representing the ACC II Committee, Jeremy V. Richards, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP, in Los Angeles, California, suggests that the exclusivity be maintained at least for the limited purpose of allowing the Plan Proponents -- ACOM Debtors and the Official Committee of Unsecured Creditors -- to seek confirmation of the ACOM Debtors' Fifth Amended Plan of Reorganization by October 31, 2006. Representing the Official Committee of Unsecured Creditors, David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, contends that the Court should not terminate exclusivity because: (1) the Banks do not satisfy any of the factors for terminating exclusivity; (2) the ACOM Debtors did not "waive" exclusivity and Section 1121(d) of the Bankruptcy Court provides for termination of unexpired exclusivity periods by the court for cause, not on the basis of an alleged waiver by a debtor; and (3) termination of exclusivity will be an expensive and litigious exercise in futility. The Ad Hoc Adelphia Trade Claims Committee supports the Creditors Committee's statements. Kenneth H. Eckstein, Esq., at Kramer Levin Naftalis & Frankel LLP, in New York, counsel for the Ad Hoc Committee of FrontierVision Noteholders, contends that maintaining the Debtors' exclusivity to permit solicitation of the Fifth Amended Plan without the confusion of competing plans presents the best path to a solution of the Debtors' Chapter 11 cases. On behalf of JPMorgan Chase Bank, N.A., James C. Tecce, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, asserts that any Chapter 11 plan proposed and confirmed in the ACOM Debtors' Chapter 11 cases must reflect the salient terms of the FrontierVision Stipulation dated July 27, 2006, which, among other things, addresses the FrontierVision Lenders' rights to post-effective date indemnification. Although the Equity Committee agrees that the Court should terminate exclusivity to allow parties to file competing plans of reorganization, the Equity Committee believes that the Court should not convert the Operating Company Debtors' cases to Chapter 7. Mr. Friedman, on the Creditors Committee's behalf, argues that the Debtors' Chapter 11 cases should not be converted because: (1) there is no continuing loss to or diminution of the estates and there is absence of reasonable likelihood of rehabilitation; (2) the Banks cannot demonstrate that it is unreasonable to expect that a plan of reorganization will be confirmed; (3) the Banks cannot demonstrate that the Debtors have unreasonably failed to timely file a plan of reorganization, pursue confirmation, or otherwise prosecute their cases; and (4) conversion is not in the best interest of unsecured creditors. The Arahova Noteholders Committee agrees with the Creditors Committee's contentions. Marc Abrams, Esq., at Willkie Farr & Gallagher LLP, in New York, the ACOM Debtors' counsel, maintains that creditor dissatisfaction with select terms of a proposed plan does not constitute cause to convert Chapter 11 cases to Chapter 7 if it will be detrimental to the estates. About Adelphia Communications Based in Coudersport, Pa., Adelphia Communications Corporation (OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest cable television company in the country. Adelphia serves customers in 30 states and Puerto Rico, and offers analog and digital video services, high-speed Internet access and other advanced services over its broadband networks. The Company and its more than 200 affiliates filed for Chapter 11 protection in the Southern District of New York on June 25, 2002. Those cases are jointly administered under case number 02-41729. Willkie Farr & Gallagher represents the ACOM Debtors. PricewaterhouseCoopers serves as the Debtors' financial advisor. Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP represent the Official Committee of Unsecured Creditors. Adelphia Cablevision Associates of Radnor, L.P., and 20 of its affiliates, collectively known as Rigas Manged Entities, are entities that were previously held or controlled by members of the Rigas family. In March 2006, the rights and titles to these entities were transferred to certain subsidiaries of Adelphia Cablevision, LLC. The RME Debtors filed for chapter 11 protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642). Their cases are jointly administered under Adelphia Communications and its debtor-affiliates chapter 11 cases. (Adelphia Bankruptcy News, Issue Nos. 149; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ADVANCED MEDICAL: Fitch Affirms and Withdraws Low-B Ratings ----------------------------------------------------------- Fitch affirms the senior secured credit facility, the Issuer Default Rating, the senior subordinated convertible debt ratings, and the Stable Rating Outlook of Advanced Medical Optics, Inc. In addition, Fitch simultaneously withdraws all ratings for this issuer. The withdrawn ratings are: -- Issuer Default Rating (IDR) 'B+'; -- Senior secured credit facility 'BB+/RR1'; -- Senior subordinated convertible debt 'B+/RR4'. Based in Santa Ana, California, Advanced Medical Optics, Inc. (NYSE: EYE) -- http://wwwamo-inc.com/-- develops, manufactures and markets ophthalmic surgical and contact lens care products. AMO employs approximately 3,600 worldwide. The company has operations in 24 countries and markets products in 60 countries. AMAZON.COM: 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 and Canadian Retail sector, the rating agency confirmed its BA3 Corporate Family Rating for Amazon.com, Inc. Additionally, Moody's revised and 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 ---------- ------- ------- ------ ---------- $900 million 4.75% Convertible Subordinated Notes B2 B2 LGD5 82% $306 million 6.75% Premium Adj. Convertible Sec. B2 B2 LGD5 82% Senior Unsecured Shelf Registration (P)B1 (P)Ba2 LGD3 35% Subordinated Shelf Registration (P)B2 (P)B2 LGD5 82% Preferred Stock Shelf Registration (P)B3 (P)B2 LGD6 97% 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 Seattle, Wash., Amazon.com, Inc. (Nasdaq: AMZN) a Fortune 500 company, opened on the World Wide Web in July 1995 and offers Earth's Biggest Selection. Amazon.com seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of unique new, refurbished and used items in categories such as health and personal care, jewelry and watches, gourmet food, sports and outdoors, apparel and accessories, books, music, DVDs, electronics and office, toys and baby, and home and garden. Amazon.com and its affiliates operate retail sites http://www.amazon.com/, http://www.amazon.co.uk/ http://www.amazon.de/, http://www.amazon.co.jp/, http://www.amazon.fr/, http://www.amazon.ca/ and http://www.joyo.com/ AMERICAN CREDIT: Selling Roanoke Personal Properties for $845,867 ----------------------------------------------------------------- American Credit Company obtained authority from the United States Bankruptcy Court for the Eastern District of North Carolina to execute an amended purchase agreement it entered into with Southern Loans, Inc. for the sale of its personal properties in Roanoke Rapids and Wilson, North Carolina for approximately $845,867. The Debtor also obtained the Court's permission to assume a nonresidential lease for the Roanoke Rapids Office with S.L. Nusbaum Realty, and assign the lease to Southern Loans consistent with the provisions of the Amended Purchase Agreement. The Court directed the Debtor to give five days notice to Wells Fargo Financial Preferred Capital, Inc. and the Official Committee of Unsecured Creditors if the Debtor's repurchase obligations to the purchaser pursuant to the provisions of the Amended Purchase Agreement exceed $5,000. Wells Fargo is the holder of a first priority security interest in the Debtor's accounts receivable, any related security and any proceeds. Headquartered in Greenville, North Carolina, American Credit Company, aka Resident Lenders of North Carolina, Inc. is a financial services company that provides consumer loans and auto financing. The Debtor filed for chapter 11 protection on July 21, 2006 (Bankr. E.D. N.C. Case No. 06-02189). Gregory B. Crampton, Esq., and Stephani W. Humrickhouse, Esq., at Nicholls & Crampton, P.A., represent the Debtor. Brian D. Darer, Esq., at Parker Poe Adams & Bernstein LLP represents the Official Committee of Unsecured Creditors. The Debtor's financial condition as of May 31, 2006 showed total assets of $21,263,884 and total debts of $18,075,640. The Debtor's exclusive period to file a chapter 11 plan expires on Nov. 18, 2006. AMERICAN CREDIT: Brings In McGladrey & Pullen as Accountants ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of North Carolina gave American Credit Company authority to employ McGladrey & Pullen, LLP, and RSM McGladrey, Inc., as its accountants. The Debtor expects McGladrey to: (a) prepare and file its state and federal tax returns; (b) provide consulting services related to the sale or valuation of the Debtor's loan portfolio, and provide necessary tax advice relating to the Debtor's business operations and proposed transactions; (c) compile monthly financial statements of the Debtor, provide payroll preparation and perform all other accounting services for the Debtor which may be necessary in its chapter 11 case; and (d) provide other services as may be requested. As reported in the Troubled Company Reporter on Sept. 26, 2006, the Debtor told the Court that RSM McGladrey and McGladrey & Pullen's professionals bill: Designation Hourly Rate ------------ ----------- Partner $350 Managing Director $350 Director $250 Manager $200 Supervisor $150 Senior $140 Staff 2 $125 Staff 1 $110 Client Service Representative $100 Morris R. Marshburn, a partner at McGladrey & Pullen and a managing director of RSM McGladrey, assures the Court that the firms are disinterested as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Greenville, North Carolina, American Credit Company, aka Resident Lenders of North Carolina, Inc. is a financial services company that provides consumer loans and auto financing. The Debtor filed for chapter 11 protection on July 21, 2006 (Bankr. E.D. N.C. Case No. 06-02189). Gregory B. Crampton, Esq., and Stephani W. Humrickhouse, Esq., at Nicholls & Crampton, P.A., represent the Debtor. Brian D. Darer, Esq., at Parker Poe Adams & Bernstein LLP represents the Official Committee of Unsecured Creditors. The Debtor's financial condition as of May 31, 2006 showed total assets of $21,263,884 and total debts of $18,075,640. The Debtor's exclusive period to file a chapter 11 plan expires on Nov. 18, 2006. AMERISTAR CASINOS: 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 gaming, lodging and leisure sectors, the rating agency revised its Corporate Family Rating for Ameristar Casinos Inc. to B1 from Ba3. In addition, Moody's affirmed its Ba3 ratings on the company's Five Year Senior Secured Revolver and Seven Year Senior Secured Term Loan. Moody's assigned those debentures an LGD3 rating suggesting lenders will experience a 36% 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 Las Vegas, Nevada, Ameristar Casinos Inc. -- http://www.ameristarcasinos.com/-- engages in the development, ownership, and operation of casinos and related entertainment facilities in the United States. AMKOR TECH: Files Form 10-Q and Cures Alleged Defaults on Debts --------------------------------------------------------------- Amkor Technology, Inc. filed with the Securities and Exchange Commission, on Oct. 6, 2006, its Quarterly Report on Form 10-Q for the quarter ended June 30, 2006. The filing of the Quarterly Report cures the alleged default under the indentures governing each of the Company's outstanding series of notes. In addition, Amkor filed its annual report on Form 10-K/A for the year ended Dec. 31, 2005 and its quarterly report on Form 10-Q/A for the quarter ended March 31, 2006 containing restatements of financial results for 2003, 2004 and 2005 and the first quarters of 2005 and 2006. Amkor expected to record additional non-cash stock-based compensation expense in connection with the investigation of its historical stock option practices. The restatement reflects aggregate non-cash stock-based compensation charges totaling $106 million (after tax), for the period Jan. 1, 1998 through June 30, 2006. Approximately $90 million of this amount relates to years 1998-2002. The restatements arise from the completion of the investigation of a Special Committee of the Board of Directors, assisted by independent counsel, of Amkor's historical stock option practices. The key findings arising from the investigation include: * the investigation did not support a finding of intentional manipulation of stock option pricing by any member of Amkor's existing management team; * the Special Committee believes there is evidence that supports a finding of intentional manipulation of stock option pricing by one former executive; and that there is some evidence supporting a finding that two other former executives may have been aware of, or participated in, this conduct; * stock option grant practices were not recognized as a significant risk, and the company allowed its human resources department to control and administer the stock option grant process without adequate input or supervision from the Compensation Committee and the Board of Directors; * the company did not assure that personnel involved in the stock option grant practice understood their roles and responsibilities; * personnel received inadequate supervision and training regarding compliance with generally accepted accounting principles relating to stock options; * the Compensation Committee's policies and procedures regarding stock option grants were inadequate; and * Amkor did not have adequate processes or procedures for stock option grants, which constituted a material weakness in internal controls over financial reporting. As reported in the Troubled Company Reporter on Sept. 20, 2006, Amkor is currently the subject of an investigation by the Securities and Exchange Commission regarding, among other matters, its historical stock option grant practices. Amkor intends to continue to fully cooperate with the SEC. On Aug. 15, 2006, Amkor disclosed that it had received letters from U.S. Bank National Association as trustee and Wells Fargo Bank, N.A. as trustee alleging that the failure of Amkor to file its Quarterly Report constituted a default under the indentures governing each of the Company's outstanding series of notes. The default provisions of the indentures contain 60-day cure periods. With the filing of the Quarterly Report, Amkor has cured this alleged default under the indentures. On Sept. 14, 2006, Amkor commenced a consent solicitation from the holders of its 9.25% Senior Notes due 2016, 7-1/8% Senior Notes due 2011, 7.75% Senior Notes due 2013, 9.25% Senior Notes due 2008, 10.5% Senior Subordinated Notes due 2009, 5% Convertible Subordinated Notes due 2007 and 2.50% Convertible Senior Subordinated Notes due 2011 for a waiver of compliance by Amkor with certain covenants in the indentures governing each series of notes. The cure of the alleged default under the indentures renders the consent solicitation unnecessary, and, accordingly, the solicitation is being terminated by the Company. Consistent with the terms of the Consent Solicitation Statements, Amkor will not accept any of the consents for payment and will not pay a consent fee to the holders of any series of notes. Chandler, Arizona-based Amkor Technology, Inc. (NASDAQ: AMKR) -- http://www.amkor.com/-- provides advanced semiconductor assembly and test services. The company offers semiconductor companies and electronics original equipment manufacturers a complete set of microelectronic design and manufacturing services. * * * As reported in the Troubled Company Reporter on Aug. 21, 2006, Moody's Investors Service lowered the corporate family and long- term debt ratings of Amkor Technology, Inc. and maintained the ratings on review for possible downgrade. The speculative grade liquidity rating was downgraded to SGL-4. The ratings downgrade was prompted by the company's Form 8-K announcement late yesterday of non-reliance on past financial statements and intent to materially restate its financial reports for fiscal years 1998 through 2005 and the March quarter of 2006, which indicates material weaknesses in the company's disclosure and internal controls. These ratings were lowered and kept on review for possible downgrade: Corporate Family Rating to Caa1 from B3; $300 million Senior Secured (2nd lien) Term Loan due October 2010 to B3 from B2; Senior Unsecured Notes with various maturities totaling $1.162 billion to Caa3 from Caa1; and Subordinated Notes with various maturities totaling $354.4 million to Ca from Caa3. This rating was downgraded: Speculative Grade Liquidity Rating to SGL-4 from SGL-3. As reported in the Troubled Company Reporter on Aug. 17, 2006, Standard & Poor's Ratings Services lowered its corporate and other ratings on Chandler, Arizona-based Amkor Technology Inc., and placed the ratings on CreditWatch with developing implications. The corporate credit rating was lowered to 'CCC' from 'B-'. Standard & Poor's credit analyst Lucy Patricola said that the rating action was due to "the company's announcement that it receivednotice from the trustees of $1.6 billion of its senior and subordinated notes (out of total funded indebtedness of about $2 billion as of June 30, 2006) that the delay in filing its 10-Q for the June quarter constitutes a default under the notes." ARMSTRONG WORLD: Five Panel Professionals Want Fees Allowed ----------------------------------------------------------- Five professionals representing the Official Committee of Unsecured Creditors and the Official Committee of Asbestos Personal Injury Claimants in the Chapter 11 case of Armstrong World Industries, Inc., asked the Honorable Eduardo C. Robreno of the U.S. District Court for the Eastern District of Pennsylvania, to allow their fees and expenses totaling $3,963,198 incurred during the confirmation period: Period Professionals Covered Fees Expenses ------------- ------- ---- -------- 04/06/06- Campbell & Levine, LLC 07/31/06 $37,250 $0 Caplin & Drysdale, Chartered (National 04/07/06- Counsel) 07/31/06 798,086 141,631 Legal Analysis 04/01/06- Systems, Inc., 07/31/06 331,270 6,658 Navigant Consulting, Inc. 04/07/06- 07/11/06 495,539 36,934 Paul, Weiss, Rifkind, 04/04/06- Wharton & Garrison LLP 07/27/06 1,777,850 337,980 Campbell & Levine works as counsel for the Asbestos Committee, while Legal Analysis is the Asbestos Committee's consultant for asbestos personal injury claims. Paul Weiss, and Caplin & Drysdale are the Creditors Committee's attorneys. Navigant Consulting is the claims expert and consultant to the Creditors Committee's counsel. U.S. Trustee Objects to Kaye Scholer's Fees Kelly Beaudin Stapleton, the United States Trustee for Region 3, asks District Court Judge Robreno to deny the fee application filed by Kaye Scholer LLP, counsel for Dean M. Trafelet, the Futures Representative. Kaye Scholer is seeking payment for $1,714,435 in fees and $270,756 in expense related to the confirmation of AWI's Plan. The U.S. Trustee's attorney, Richard L. Schepacarter, Esq., tells the District Court that certain time entries in the firm's fee application are vague and provide no indication as to what benefit was added to the bankruptcy estate. Additionally, Mr. Schepacarter points to one of the firm's associate, Navin Pant, Esq., whose admission to the bar is "pending" and who is billed at the rate of $265 per hour and expended 158.10 hours for a total fee of $41,897. Mr. Schepacarter says much of Mr. Pant's "time appears to be superfluous, duplicative or that which could have been handled by less costly professionals." Professional fees may not be awarded unless and until the applicant shows that there is a benefit to the estate and that the fees are reasonable and necessary, Mr. Schepacarter asserts. "Benefit to the estate and necessity are critical threshold issues before the awarding of any fees or compensation." Applicants must supply sufficient information to enable proper analysis of the services rendered as required by Rule 2016(a) of the Federal Rules of Bankruptcy Procedure, which requires that an entity seeking compensation for services should provide detailed statement of the services rendered, time expended and expenses incurred to allow the determination of whether the services were actual and necessary, Mr. Schepacarter notes. The applicant should sufficiently identify and itemize its services so a determination of the reasonableness of each task may be achieved, Mr. Schepacarter adds. The U.S. Trustee reserves any and all rights, remedies and obligations to supplement or modify its Objection and to conduct any discovery as may be deemed necessary. About Armstrong World 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. The Company's "Fourth Amended Plan of Reorganization, as Modified," has become effective and AWI has emerged from Chapter 11. (Armstrong Bankruptcy News, Issue No. 102; Bankruptcy Creditors' Service,Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported in the Troubled Company Reporter on Oct. 9, 2006 Standard & Poor's Ratings Services raised its corporate credit rating on Armstrong World Industries Inc. to 'BB' from 'D', following the Company's emergence from bankruptcy on Oct. 2, 2006. The outlook is stable. ARMSTRONG WORLD: Sea-Pac Wants Claim Objection Overruled -------------------------------------------------------- Sea-Pac Sales Company asks the Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware to: (a) allow its administrative expense claim asserted against Armstrong World Industries, Inc.; (b) overrule the Debtor's objection to the administrative expense claim; and (c) resolve all issues relating to the Claim through mediation or arbitration. As reported in the Troubled Company Reporter on Aug. 18, 2006 Armstrong World Industries, Inc., asked the Court to disallow and expunge Claim No. 4854 asserted by Sea-Pac. Sea-Pac wants the Debtor to pay $4,900,000 in administrative expenses it incurred as a result of the Debtor's violations of the parties' Residential Flooring Products Distributorship and Sales/Service Center Agreement and Commercial Flooring Products Distributorship Agreement. Karen Lee Turner, Esq., at Eckert Seamans Cherin & Mellott LLC, in Wilmington, Delaware, relates that, as part of the Residential Agreement, Sea-Pac became the Debtor's regional distribution center in the Pacific Northwest. The Debtor agreed to reimburse Sea-Pac for its RDC services. Under the Commercial Agreement, the Debtor appointed Sea-Pac as its wholesale distributor of commercial flooring products. The Debtor agreed to consult with Sea-Pac before setting "mill shipment requirements" for a certain year. Ms. Turner asserts that the Debtor breached the Agreements by failing to reimburse Sea-Pac for its RDC services and by appointing a second distributor within Sea-Pac's sales territory. The Debtor, however, argued that it had the legal right to appoint a second distributor of its products: * after complying with Sea-Pac's mill shipment requirements; and * because Sea-Pac violated the terms of the Agreements by selling products manufactured by the Debtor's competitors. Ms. Turner argues that the Debtor sent no operative "mill shipment requirements" in 2002. Hence, the Debtor was prohibited by the terms of the Commercial Agreement from appointing a second distributor within Sea-Pac's exclusive territory in the absence of those requirements. Ms. Turner contends that the Agreements provide certain conditions, which should have been fulfilled before the Debtor's option to terminate Sea-Pac's exclusivity became effective. None of those conditions have occurred, nor any of the Debtor's obligations have been excused, Ms. Turner argues. Thus, the Debtor's option to terminate Sea-Pac's exclusivity was never effective, and the Debtor's appointment of a second distributor was a breach of the Agreements. Additionally, there is no requirement in either Agreement that Sea-Pac would sell solely the Debtor's products, Ms. Turner points out. By 2002, many of the Debtor's products had become unprofitable that Sea-Pac began selling a line of wood laminate floor covering, Quick Step, manufactured by Unilin, which competed with the Debtor's inferior wood laminate product. Ms. Turner relates that the Debtor's representatives advised Sea-Pac that the Debtor did not want the Claimant to sell the Quick Step product. "[W]hen Sea-Pac continued to [sell the Quick Step], [AWI] decided 'to punish' Sea-Pac by appointing a second distributor in Sea-Pac's territory in breach of the Commercial Agreement," she asserts. Contrary to the Debtor's allegations, Sea-Pac's claim is sufficiently supported in its proof of claim, by the Debtor's own records, and by Sea-Pac's other related filings, Ms. Turner further asserts. With respect to the timeliness of Sea-Pac's Claim, Ms. Turner clarifies that, although the Claimant did not file a proof claim by the administrative expense bar date, Sea-Pac timely filed a proof of claim by the executory contracts bar date. Under the Executory Bar Date Order, the Debtor reopened the claims period with respect to any claim arising under certain "Previously Scheduled Contracts", Ms. Turner notes. The Order indicates that a claim related to the Previously Scheduled Contracts must be filed if its status is other than a general unsecured claim prior to the Debtor's filing for chapter 11 protection, presumably including administrative claims as "other," Ms. Turner points out. Moreover, Ms. Turner argues that Sea-Pac's Claim is entitled to administrative priority because it satisfies the criteria set in In re Mammoth Mart, 536 F.2d 950 (1st Cir. 1976), to determine an administrative expense: (1) The claim arose from a transaction between a claimant and the Debtor; and (2) The consideration supplied by the claimant must benefit the Debtor. Whether a transaction is considered postpetition for purposes of the Mammoth Mart test depends not on the execution date of the contract, but, instead, whether the claimant was "induced" to perform the contract by the debtor-in-possession, not the prepetition debtor. Sea-Pac is also entitled to attorney's fees and interest pursuant to the provisions of the Agreements, Ms. Turner adds. The Agreements contain alternative dispute resolution provisions stating that the losing party will pay the costs of arbitration, including attorney's fees. The Agreements also provide that AWI will indemnify Sea-Pac from any claims and other costs of any kind arising out of breach of contract. In a separate filing, Sea Pac asks Judge Fitzgerald: (i) to stay the Debtor's claims objection proceeding pending mediation or arbitration in accordance with the provisions of the Agreements; and (ii) for relief from the automatic stay or, in the alternative, from the discharge injunction under the Debtor's Plan of Reorganization. About Armstrong World 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. The Company's "Fourth Amended Plan of Reorganization, as Modified," has become effective and AWI has emerged from Chapter 11. (Armstrong Bankruptcy News, Issue No. 102; Bankruptcy Creditors' Service,Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported in the Troubled Company Reporter on Oct. 9, 2006 Standard & Poor's Ratings Services raised its corporate credit rating on Armstrong World Industries Inc. to 'BB' from 'D', following the Company's emergence from bankruptcy on Oct. 2, 2006. The outlook is stable. ARMSTRONG WORLD: Distributes $407 Million to Class 6 Creditors -------------------------------------------------------------- Armstrong World Industries, Inc. disclosed the amount of the initial distributions it expects to make to general unsecured creditors under its Chapter 11 plan. Specifically, distributions to holders of allowed unsecured claims falling in Class 6 will commence on Oct. 17, 2006, pursuant to its Court-approved "Fourth Amended Plan of Reorganization, as Modified," dated Feb. 21, 2006. Per $10,000 of such claims, an initial distribution of 116 Common Shares of reorganized Armstrong World Industries and approximately $2,435 in cash are expected. The initial distributions exclude approximately $11 million of cash and 538,000 shares that are reserved from distribution due to disputed unsecured claims in Class 6. A total of 19,418,520 shares and $407 million of cash will be distributed to creditors in Class 6 under the Plan. Separately, in discharge of all of its present and future asbestos-related personal injury claims, the Company issued under the Plan 36,981,480 Common Shares to the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust and by Oct. 17, 2006, will distribute to the Trust $738 million in cash, representing the portion of cash distributions to which the Trust is entitled under the Plan. All present and future asbestos- related personal injury claims must be asserted against, and will be resolved by, the Trust, and such claims may not be asserted against the Company. Under the Plan, payments to unsecured creditors having allowed claims of $10,000 or less (or who have reduced their claims to $10,000) began on Oct. 2, 2006. Those creditors receive distributions entirely in cash in an amount equal to approximately 75% of their allowed claims. The cash amount to be distributed to Class 6 creditors and the Trust includes "Available Cash" as defined in the Plan and $775 million of the cash proceeds expected from $800 million of term loans that the Company is arranging in lieu of issuing notes under the Plan. These term loans are in addition to a $300 million revolving credit facility already established, which is currently undrawn and will be available to support the Company's ongoing liquidity needs. The Company also reported that its Common Shares have been approved for listing on the New York Stock Exchange under the ticker symbol "AWI" on Oct. 10, 2006. "We are pleased to return to the New York Stock Exchange, where Armstrong first began trading on July 17, 1935," said F. Nicholas Grasberger III, Armstrong's Senior Vice President and CFO. "This is the renewal of a long and rewarding relationship between Armstrong and the NYSE." "We are pleased to welcome back Armstrong World Industries to our family of NYSE-listed companies, resuming our 70-plus-year partnership with the company," said NYSE Group, Inc. Chief Executive Officer John A. Thain. "We look forward to serving Armstrong World Industries and its shareholders, and providing the company with superior market quality and brand visibility." A full-text copy of the Fourth Amended Plan of Reorganization is available for free at http://ResearchArchives.com/t/s?fb4 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. AWI emerged from Chapter 11 protection on Oct. 2, 2006. * * * As reported in the Troubled Company Reporter on Oct. 9, 2006, Standard & Poor's Ratings Services raised its corporate credit rating on Armstrong World Industries Inc. to 'BB' from 'D', following the building products company's emergence from bankruptcy on Oct. 2, 2006. The outlook is stable. The 'BB' senior secured bank loan rating and the '2' recovery rating on Armstrong's proposed $1.1 billion senior secured bank facility are affirmed. The bank loan rating was assigned on Sept. 28, 2006, based on the assumption that Armstrong would exit bankruptcy as well as satisfy other conditions. AZTAR CORPORATION: 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 gaming, lodging and leisure sectors, the rating agency confirmed its Ba2 Corporate Family Rating for Aztar Corporation. Additionally, Moody's held its probability-of- default ratings and assigned loss-given-default ratings on these debentures: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- 9% Senior Sub. Notes Ba3 Ba3 LGD5 80% 7-7/8% Senior Sub. Notes Ba3 Ba3 LGD5 80% 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%). Phoenix, AZ-based Aztar Corporation -- http://www.aztar.com/-- engages in the ownership and operation of land-based casinos and riverboat casinos primarily in New Jersey, Nevada, Missouri, and Indiana, the United states. BAKER & TAYLOR: 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 and Canadian Retail sector, the rating agency confirmed its B2 Corporate Family Rating for Baker & Taylor Acquisitions Corporation and upgraded its B3 rating on the Company's $165 million second lien secured notes to B2. In addition, Moody's assigned an LGD4 rating to notes, suggesting noteholders will experience a 65% 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%). Baker & Taylor Acquisitions Corp. is a holding company whose sole asset is Baker & Taylor Corporation which is a domestic and international distributor of books and entertainment products to libraries and retailers that is headquartered in Charlotte, North Carolina. BALLY TOTAL: S&P Holds CCC Rating and Removes Developing Watch -------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings, including the 'CCC' corporate credit rating, on fitness club operator Bally Total Fitness Holding Corp. All ratings are removed from CreditWatch, where they were placed with developing implications on Dec. 2, 2005, based the company's exploration of strategic alternatives. The outlook is developing. Total debt outstanding as of June 30, 2006, was $723 million. "Although Bally continues to explore strategic alternatives, the probability of a major infusion of equity to reduce debt is considerably diminished," said Standard & Poor's credit analyst Andy Liu. Separately, Bally announced that it had obtained a commitment letter from several financial institutions with respect to a new, $280 million senior secured credit facility with a final maturity date at the earlier of (1) Oct. 1, 2010, or (2) the date 14 days prior to the maturity date of the company's 9.875% senior subordinated notes due 2007, including if the maturity date on these senior subordinated notes have been extended. Proceeds of the new credit facility will be used to refinance the company's existing credit facility, fund capital expenditures, and provide for additional liquidity. The ratings on Bally reflect the company's significant near-term maturities, heavy debt and operating lease burden, and negative discretionary cash flow. These factors are only partially offset by the company's geographic diversity and large club base. Bally is the largest fitness club operator in North America, with more than 380 clubs in the U.S. and Canada and about 3.6 million members. BCBG MAX: 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 the US and Canadian Retail sector, the rating agency confirmed its B1 Corporate Family Rating for BCBG Max Azria Group, Inc. Additionally, Moody's revised and 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 ---------- ------- ------- ------ ---------- $150 million Asset-Based Revolver Ba3 Ba2 LGD2 20% $199.5 million Term Loan B1 B1 LGD3 48% $80 million Third Lien Term Loan B3 B3 LGD5 76% 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%). BCBG Max Azria Group, Inc., headquartered in Vernon, California, is an apparel retailer and wholesaler. It operates 80 retail stores, 57 factory stores, and 102 partner shops in the United States. In addition, it distributes to over 400 wholesale doors under the BCBGMaxAzria, TO THE MAX, maxime, dorothee bis, Herve Leger, BCBGirls, Parallel, and maxandcleo brand names. The Max Rave acquisition will add a minimum of 450 stores currently under the G+G, Rave, and RaveGirl name plates which will all be converted to the Max Rave name plate. BERRY PETROLEUM: S&P Pates Proposed $200 Million Senior Notes at B ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to oil and gas exploration and production company Berry Petroleum Corp. and its 'B' rating to Berry's proposed $200 million senior subordinated notes due 2016. Proceeds from the note offering will be used to reduce outstanding bank debt. The outlook is stable. Bakersfield, California-based Berry had about $270 million of debt as of June 30, 2006. The ratings on Berry reflect its midsize reserve base, high lifting costs, concentration of production and the highly cyclical nature of the exploration and production industry. These weaknesses are tempered by the relatively low-risk nature of the company's reserve base, attractive growth opportunities, competitive finding and development costs, and a fairly moderate capital structure. "The stable outlook on Berry reflects our expectation that although the company might make small tactical, add-on acquisitions, its large drilling inventory has diminished the need for larger acquisitions," said Standard & Poor's credit analyst John Thieroff. As of Dec. 31, 2005, Berry had a reserve base of 126 million barrels of oil equivalent. BLB MANAGEMENT: 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 gaming, lodging and leisure sectors, the rating agency revised its Corporate Family Rating for BLB Management Services Inc. to B2 from B1. Additionally, Moody's revised its probability-of-default ratings and assigned loss-given-default ratings on these loans obligations: Projected Old POD New POD LGD Loss-Given Debt Issue Rating Rating Rating Default ---------- ------- ------- ------ ---------- Senior Secured 1st Lien Revolver B1 Ba3 LGD3 36% Senior Secured 1st Lien TL-B B1 Ba3 LGD3 36% Senior Secured 2nd Lien TL-C B2 B3 LGD5 88% 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%). BLOCKBUSTER 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 the US and Canadian Retail sector, the rating agency confirmed its B3 Corporate Family Rating for Blockbuster 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 ---------- ------- ------- ------ ---------- $500 million Sr. Sec. Revolving Credit Facility B3 B1 LGD2 25% $100 million Senior Secured Term Loan A B3 B1 LGD2 25% $550 million Senior Secured Term Loan B B3 B1 LGD2 25% $300 million 9% Sr. Sub. Notes Caa3 Caa2 LGD5 86% 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%). About Blockbuster Blockbuster Inc. (NYSE: BBI, BBI.B) -- http://www.blockbuster.com/ -- provides in-home movie and game entertainment, with more than 9,000 stores throughout the Americas, Europe, Asia and Australia. The company operates in Puerto Rico, Argentina, Brazil and Chile. CABLEVISION SYSTEMS: Sr. Notes Exchange Offer Stretched to Nov. 2 ----------------------------------------------------------------- CSC Holdings, Inc., a subsidiary of Cablevision Systems Corp., disclosed on Oct. 5, 2006 that it would further extend until Nov. 2, 2006, at 5:00 p.m., New York City time, its offer to exchange up to $500 million aggregate principal amount of its 6-3/4% Senior Notes due 2012, which were initially issued and sold in a private placement in April 2004, for an equal aggregate amount of its registered 6-3/4% Senior Notes due 2012. Except for the extension of the expiration date, all of the other terms of the exchange offer remain as set forth in the exchange offer prospectus dated July 18, 2006. About Cablevision Headquartered in Manhattan, Cablevision Systems Corp. (NYSE: CVC) -- http://www.cablevision.com/-- provides cable TV service to about 3 million customers in and around New York City. The firm has upgraded its network and services to include digital cable, movies-on-demand, and VoIP telephony. It also operates business communications service provider Cablevision Lightpath and regional sports channels. Cablevision controls Madison Square Garden, the New York Knicks and the New York Rangers, plus Radio City Music Hall. Cablevision pulled plans to spin off its cable network unit, Rainbow Media Holdings, and instead closed that company's money-losing satellite TV assets. Chairman Charles Dolan and his family control Cablevision. CABLEVISION SYSTEM: Dolan's Offer Cues Moody's to Review Ratings ---------------------------------------------------------------- Moody's Investors Service placed all ratings for Cablevision Systems Corporation, CSC Holdings, Inc., a wholly owned subsidiary of CVC, and Rainbow National Services LLC on review for downgrade following the Dolan family's announcement of a proposal to acquire Cablevision. In Moody's view, under the proposed transaction, Cablevision's credit metrics would deteriorate meaningfully as debt of the cable operations would increase to approximately 11 times EBITDA from 7 times range. Moody's also notes that the company has to balance pro forma transaction higher interest burden with a continuing need to invest in the cable operations given increasingly competitive environment. In Moody's view, Rainbow's event risk would increase as a result of the transaction, given increased financial burden on the parent company. These Ratings on Review for Possible Downgrade: On Review for Possible Downgrade: Cablevision Systems Corporation * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3,LGD6, 93% CSC Holdings, Inc. * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba2, LGD2, 21% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD5, 73% Rainbow National Services LLC * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba1, LGD2, 19% * Senior Subordinated Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3, LGD5, 86% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD4, 59% Outlook Actions: Cablevision Systems Corporation * Outlook, Changed To Rating Under Review From Stable CSC Holdings, Inc. * Outlook, Changed To Rating Under Review From Stable Rainbow National Services LLC * Outlook, Changed To Rating Under Review From Stable Affirm Cablevision Systems Corporation * Speculative Grade Liquidity Rating SGL-2 Rainbow National Services LLC * Speculative Grade Liquidity Rating SGL-2 Moody's will evaluate the likely effect of the proposed financing, specifically the increase in leverage and the composition of the debt. Moody's estimates debt will increase to approximately 11 times EBITDA pro forma for the transaction and based on estimated LTM to June 30, 2006 EBITDA, from approximately 7 times. In analyzing Cablevision's cable operations, Moody's focuses on the debt currently called Restricted Group debt and the bonds at CVC; cash flow from the consumer and business cable assets services this debt. Headquartered in Bethpage, New York, Cablevision Systems Corporation, is a domestic cable multiple system operator serving more than 3 million subscribers in and around the metropolitan New York area. Rainbow National Services LLC, headquartered in Jericho, New York, supplies television programming to cable television and direct broadcast service providers throughout the United States. CABLEVISION SYSTEMS: Dolan Buyout Offer Prompts Fitch's Neg. Watch ------------------------------------------------------------------ Fitch Ratings has placed Cablevision Systems Corporation and its wholly owned subsidiary CSC Holdings, Inc., on Rating Watch Negative: CVC -- Issuer Default Rating (IDR) 'B+'; -- Senior unsecured debt 'CCC+/RR6'. CSC -- Issuer Default Rating (IDR) 'B+'; -- Secured bank facility rating 'BB/RR1'. -- Senior unsecured debt 'BB-/RR3'. Approximately $12.6 billion of debt as of June 30, 2006 is affected by Fitch's action. Fitch's rating action follows the announcement that the Dolan family has offered to buy out the public shareholders of CVC for $27 a share. It has been reported that the Dolan family does not intend to pursue their offer without the consent of CVC's special committee, which will review the fairness of the offer. If consent is given by the special committee, Fitch believes that the Dolan family will be successful and that the existing covenants associated with the credit facility as well as the senior notes at CSC Holdings will allow for leverage to increase dramatically to fund the buyout. The senior notes at CSC Holdings have a debt incurrence limitation at 9 times (x) leverage. It is expected that the Dolan's will in part fund the buy out with their CVC share ownership valued at $1.7 billion. Fitch expects that the remaining portion of the buyout will result in leverage at CVC and CSC increasing to 8-9x. If the buyout is successful, Fitch may downgrade the IDR for CVC and CSC by at least two notches. CATHOLIC CHURCH: Parishioners Can Hold Claims Against Portland -------------------------------------------------------------- Certain individual parishioners and other parties represented by the Catholic Parishes, Parishioners and Interested Parties has sought the U.S. Bankruptcy Court for the District of Oregon to declare that they hold monetary claims against the Archdiocese of Portland in Oregon. Judge Elizabeth Perris rules that: (a) the Parishioners have standing in a representative capacity to assert claims for monetary damages for breach of fiduciary duty against the Archdiocese's bankruptcy estate on behalf of charitable trusts, if any, of which they are fiduciary; (b) distributions resulting from the claims, if any, would replenish any charitable trust that may be impaired in connection with the bankruptcy case. Distributions will not be payable to individual parishioners; (c) the Parishioners' claims are limited to claims for fiduciary duty. Parishioners have no claims in their individual capacity and all individual claims are denied; and (d) nothing in the Order will constitute a determination with respect to the: (i) existence or validity of charitable trusts; or (ii) any interest of any charitable trust in any real estate titled in the name of the Archdiocese. The Archdiocese of Portland in Oregon filed for chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman Shank LLP, represent the Portland Archdiocese in its restructuring efforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents the Official Tort Claimants Committee in Portland, and scores of abuse victims are represented by other lawyers. David A. Foraker serves as the Future Claimants Representative appointed in the Archdiocese of Portland's Chapter 11 case. In its Schedules of Assets and Liabilities filed with the Court on July 30, 2004, the Portland Archdiocese reports $19,251,558 in assets and $373,015,566 in liabilities. (Catholic Church Bankruptcy News, Issue No. 70; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: Davenport Diocese Files for Bankruptcy Protection ------------------------------------------------------------------ The Roman Catholic Diocese of Davenport filed a voluntary chapter 11 petition Tuesday, the fourth diocese in the nation to seek for bankruptcy protection to deal with priest sex abuse cases, Foxnews.com reports. According to the news, Bishop William Franklin said the Diocese has no other alternative to settle 25 outstanding claims against four priests accused of sexual child abuse, all of which occurred thirty or forty years ago. Todd Dvorak, an Associated Press writer states that since 2004, the Diocese has paid more than $10.5 million to resolve dozens of claims filed against priests, including a $9 million deal reached with 37 victims in fall 2004. As a result, juries have held liable for the diocese or former priests under its supervision in civil actions. A news release from the Diocese says its chapter 11 filing is the result of its settlement demands, which are greater than the available assets of the Diocese, and without the filing, it can't continue on its present church's mission. However, Church officials and other parties speculate that the decision for bankruptcy filing is being driven by a new set of claims aimed at the Diocese and retired Bishop Lawrence Soens. The first of three trials involving Mr. Soens and the Dioceses was set to begin Oct. 23, 2006, but a victim's lawyer, Craig Levien, said it likely will be dismissed in light of the chapter 11 filing, Mr. Dvorak adds. Court documents show that the Diocese listed its assets of nearly $4.5 million and liabilities of nearly $1.7 million. The Davenport Diocese was erected in 1881, covers 22 counties in southeast Iowa and has more than 105,000 parishioners in 84 parishes. CATHOLIC CHURCH: Diocese of Davenport Chapter 11 Case Summary ------------------------------------------------------------- Debtor: Diocese of Davenport 2706 Gaines Street Davenport, IA 52804 Bankruptcy Case No.: 06-02229 Type of Business: The Roman Catholic Church of the Diocese of Davenport had been hit by a succession of lawsuits that allege church leaders knowingly allowed priests with histories of sexual abuse of children to be moved to new assignments. The bankruptcy filing delayed pending clergy abuse lawsuits and putting difficulty to an attempt to pay a $1.5 million jury award to an abuse victim. The diocese could not meet the $7 million settlement demand of 15 men who filed lawsuits claiming they were sexually abused by retired Sioux City Bishop Lawrence Soens when he was principal of Regina High School in Iowa City. Chapter 11 Petition Date: October 10, 2006 Court: Southern District of Iowa (Davenport) Debtor's Counsel: Richard A. Davidson, Esq. Lane & Waterman LLP 220 North Main Street, Suite 600 Davenport, IA 52801-1987 Tel: (563) 333-6624 Fax: (563) 324-1616 Total Assets: $4,492,809 Total Debts: $1,650,439 Debtor's Two Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Michl Uhde Court Verdict $1,530,000 2714 East Locust Davenport, IA 52803 Sexual Abuse Victims Tort Claims Unknown [no further details provided] CINEMARK INC: Century Acquisition Closing Cues S&P to Cut Ratings ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Cinemark Inc. and subsidiary Cinemark USA Inc., which are analyzed on a consolidated basis, including lowering the corporate credit ratings to 'B' from 'B+', following the closing of the company's debt-financed acquisition of Century Theatres Inc., the ratings on which were withdrawn. The ratings on Cinemark were removed from CreditWatch, where they were placed with negative implications on Aug. 8, 2006. At the same time, Standard & Poor's lowered the ratings on Cinemark USA Inc.'s senior subordinated notes and Cinemark Inc.'s senior discount notes to 'CCC+' from 'B-'. S&P is also withdrawing the ratings on Cinemark USA Inc.'s $100 million revolving credit facility due 2010 and the $260 million term loan due 2011, which it refinanced with its $150 revolving credit facility due 2012 and $1.12 billion term loan B due 2013 as part of this transaction. The outlook is stable. Pro forma for the Century acquisition, the Plano, Texas-based movie exhibitor will have $3.1 billion in debt, including holding company notes and capitalized operating leases. "The downgrade is based on the increase in credit risk arising from high debt leverage of the newly combined company and our concerns about longer term industry fundamentals," said Standard & Poor's credit analyst Tulip Lim. The ratings on Cinemark Inc. reflect the company's high lease- adjusted leverage and financial risk, its participation in the mature and highly competitive nature of the U.S. motion picture exhibition industry, its exposure to the fluctuating popularity of Hollywood films, the shortening windows between theatrical and DVD/video-on-demand release, and competition from other exhibitors and alternative entertainment sources. These concerns outweigh the benefits of the combined companies' quality theater circuits, above-average profit margins, experienced management team, and the asset flexibility provided by its profitable non-U.S. operations. COMPLETE RETREATS: Selects Donlin Recano as Claims Agent -------------------------------------------------------- In August 2006, Complete Retreats LLC and its debtor-affiliates sought the U.S. Bankruptcy Court for the District of Connecticut's permission to employ XRoads Case Management Services, LLC, as their claims, notice, and balloting agent until Sept. 30, 2006. The Debtors then voluntarily withdrew the XCM Retention Application after discussions with their counsel and the U.S. Trustee, and asked the Court pursuant to Section 363 of the Bankruptcy Code for authority to employ XCM as their claims and noticing agent until Sept. 30, 2006. Accordingly, the Debtors ask the Court's permission pursuant to Section 156(c) of the Judiciary and Judicial Procedure Code to employ Donlin, Recano & Company, Inc., as their claims, notice, and balloting agent, nunc pro tunc to September 27, 2006. XCM has informed the Debtors that it will assist Donlin Recano during the transition of the claims, noticing, and balloting services, Holly Felder Etlin, the Debtors' chief restructuring officer, relates. The Debtors have more than 5,000 creditors and other potential parties-in-interest. The Debtors believe that the Bankruptcy Clerk's Office is not equipped to (i) distribute notices, (ii) process all of the proofs of claim filed in the Chapter 11 cases, and (iii) assist in the balloting process. According to Ms. Etlin, the Debtors chose Donlin Recano based on its experience and the competitiveness of its fees. Ms. Etlin notes that Donlin Recano has provided identical or substantially similar services that the Debtors seek from it in other large Chapter 11 cases. As the Debtors' claims, notice, and balloting agent, Donlin Recano will: (a) design, maintain, and administer a claims database; (b) provide copy and notice service consistent with the applicable local bankruptcy rules; (c) file with the Bankruptcy Clerk an affidavit or certificate of service that includes a copy of the notice, a list of persons to whom it was mailed, and the date the notice was mailed; (d) docket all claims received, maintain the official claims registers for each of the Debtors, and provide the Clerk with certified duplicate unofficial Claims Registers on a monthly basis, unless otherwise directed; (e) specify for each claim docketed in the applicable Claims Register: * the claim number assigned, * the date received, * the claimant's name and address or that of the agent who filed the claim, * the filed claim amount, if liquidated, and * the classification of the claim; (f) record and provide notices of all claims transfers as required by Rule 3001 of the Federal Rules of Bankruptcy Procedure; (g) make changes in the Claims Register pursuant to an order of the Court; (h) turn over to the Clerk copies of the Claims Registers for the Clerk's review upon completion of the docketing process for all claims received to date by the Clerk's office; (i) maintain the Claims Register for public examination without charge during regular business hours; (j) maintain the official mailing list for each Debtor of all entities that have filed a proof of claim and make the list available to parties-in-interest or the Clerk upon their request; (k) assist with, among other things, solicitation, calculation, and tabulation of votes and distribution; and (l) provide and maintain a web site where parties can view the claims filed, status of claims, and pleadings or other documents filed with the Court by the Debtors; (m) box and transport all original documents in proper format, as provided by the Clerk's office, to the Federal Records Center at the close of the Debtors' bankruptcy cases. The Debtors will pay for Donlin Recano's consulting services at these hourly rates: Professional Hourly Rate ------------ ----------- Principals $250 Sr. Bankruptcy Consultant/Attorneys $170 to $230 Bankruptcy Analysts $130 to $155 Programming Consultants $135 Case Administrators $65 Data Encoders $35 The Debtors ask the Court to treat Donlin Recano's fees and expenses as an administrative expense of their estates. The Debtors further ask the Court for permission to pay Donlin Recano's fees and expenses in the ordinary course of business without the need for Donlin Recano to seek the Court's approval of its fees and expenses. Donlin Recano will maintain records of all services provided to the Debtors, showing dates, categories of services, fees charged, and expenses incurred and that it will serve monthly invoices on the counsel of the Official Committee of Unsecured Creditors and any other official committees that may be appointed in the Debtors' Chapter 11 cases. In the event the Debtors' cases are converted to cases under Chapter 7 of the Bankruptcy Code, the Debtors seek the Court's permission to continue to pay Donlin Recano for its services until the claims filed in the cases have been completely processed. Moreover, if claims agent representation is necessary in the converted Chapter 7 cases, the Debtors ask to continue paying Donlin Recano's fees and expenses in accordance with Section 156(c). Louis A. Recano, a principal of Donlin, Recano & Company, Inc., assures the Court that his firm neither holds nor represents any interest adverse to the Debtors' respective estates on matters for which it is to be employed and that it has no prior connection with the Debtors. Donlin Recano is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, Mr. Recano asserts. About Complete Retreats Headquartered in Westport, Connecticut, Complete Retreats LLC operates five-star hospitality and real estate management businesses. In addition to its mainline destination club business, the Debtor also operates an air travel program for destination club members, a villa business, luxury car rental services, wine sales services, fine art sales program, and other amenity programs for members. Complete Retreats and its debtor- affiliates filed for chapter 11 protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245). Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors in their restructuring efforts. Michael J. Reilly, Esq., at Bingham McCutchen LP, in Hartford, Connecticut, serves as counsel to the Official Committee of Unsecured Creditors. No estimated assets have been listed in the Debtors' schedules, however, the Debtors disclosed $308,000,000 in total debts. (Complete Retreats Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). COMPLETE RETREATS: Wants Removal Period Extended to January 19 -------------------------------------------------------------- As of their bankruptcy filing, Complete Retreats LLC and its debtor-affiliates were involved in approximately 21 state proceedings pending in courts throughout the country. Pursuant to Section 1452 of the Judicial Procedures Code, "a party may remove any claim or cause of action in a civil action other than a proceeding before the United States Tax Court or a civil action by a governmental unit to enforce police or regulatory power, to the district court for the district where such civil action is pending, if such district court has jurisdiction of such claim or cause of section 1334 of this title." Under Rule 9027 of the Federal Rules of Bankruptcy Procedure, if a claim or cause of action is pending when a bankruptcy case is commenced, a notice of removal "may be filed in the bankruptcy court only within . . . 90 days after the order for relief." The Debtors' removal period is scheduled to expire on October 21, 2006, Mr. Daman notes. Accordingly, the Debtors ask the U.S. Bankruptcy Court for the District of Connecticut to extend the deadline by which they may seek to remove the Proceedings through and including Jan. 19, 2007, without prejudice to their right to seek further extensions of the removal period. Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut, relates that due to the complexity and rapidity of their Chapter 11 cases, the Debtors have not completed a thorough review of the Proceedings to determine whether any individual actions should be removed under Bankruptcy Rule 9027(a). Mr. Daman expounds that the Debtors have focused primarily on: (1) stabilizing their business; (2) responding to a multitude of creditor inquiries; (3) addressing a variety of creditor concerns; and (4) working towards negotiating a potential consensual plan of reorganization. The extension will afford the Debtors sufficient opportunity to assess whether the actions can and should be removed, thereby protecting the Debtors' right to adjudicate lawsuits pursuant to Section 1452, Mr. Daman asserts. The Debtors' adversaries will not be prejudiced by the extension, as they may not prosecute the actions absent relief from the automatic stay, Mr. Daman explains. Furthermore, the extension will not prejudice any party to a proceeding that the Debtors seek to remove from pursuing a remand pursuant to Section 1452(b). About Complete Retreats Headquartered in Westport, Connecticut, Complete Retreats LLC operates five-star hospitality and real estate management businesses. In addition to its mainline destination club business, the Debtor also operates an air travel program for destination club members, a villa business, luxury car rental services, wine sales services, fine art sales program, and other amenity programs for members. Complete Retreats and its debtor- affiliates filed for chapter 11 protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245). Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors in their restructuring efforts. Michael J. Reilly, Esq., at Bingham McCutchen LP, in Hartford, Connecticut, serves as counsel to the Official Committee of Unsecured Creditors. No estimated assets have been listed in the Debtors' schedules, however, the Debtors disclosed $308,000,000 in total debts. (Complete Retreats Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). CSC HOLDINGS: Dolan Family's Offer Cues Moody's to Review Ratings ----------------------------------------------------------------- Moody's Investors Service placed all ratings for Cablevision Systems Corporation, CSC Holdings, Inc., a wholly owned subsidiary of CVC, and Rainbow National Services LLC on review for downgrade following the Dolan family's announcement of a proposal to acquire Cablevision. In Moody's view, under the proposed transaction, Cablevision's credit metrics would deteriorate meaningfully as debt of the cable operations would increase to approximately 11 times EBITDA from 7 times range. Moody's also notes that the company has to balance pro forma transaction higher interest burden with a continuing need to invest in the cable operations given increasingly competitive environment. In Moody's view, Rainbow's event risk would increase as a result of the transaction, given increased financial burden on the parent company. These Ratings on Review for Possible Downgrade: On Review for Possible Downgrade: Cablevision Systems Corporation * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3,LGD6, 93% CSC Holdings, Inc. * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba2, LGD2, 21% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD5, 73% Rainbow National Services LLC * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba1, LGD2, 19% * Senior Subordinated Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3, LGD5, 86% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD4, 59% Outlook Actions: Cablevision Systems Corporation * Outlook, Changed To Rating Under Review From Stable CSC Holdings, Inc. * Outlook, Changed To Rating Under Review From Stable Rainbow National Services LLC * Outlook, Changed To Rating Under Review From Stable Affirm Cablevision Systems Corporation * Speculative Grade Liquidity Rating SGL-2 Rainbow National Services LLC * Speculative Grade Liquidity Rating SGL-2 Moody's will evaluate the likely effect of the proposed financing, specifically the increase in leverage and the composition of the debt. Moody's estimates debt will increase to approximately 11 times EBITDA pro forma for the transaction and based on estimated LTM to June 30, 2006 EBITDA, from approximately 7 times. In analyzing Cablevision's cable operations, Moody's focuses on the debt currently called Restricted Group debt and the bonds at CVC; cash flow from the consumer and business cable assets services this debt. Headquartered in Bethpage, New York, Cablevision Systems Corporation, is a domestic cable multiple system operator serving more than 3 million subscribers in and around the metropolitan New York area. Rainbow National Services LLC, headquartered in Jericho, New York, supplies television programming to cable television and direct broadcast service providers throughout the United States. DANA CORP: Martinez Group Wants $259,041 Administrative Claim Paid ------------------------------------------------------------------ The Martinez Group, Inc., asks the U.S. Bankruptcy Court for the Southern District of New York to direct Dana Corporation to pay $259,041 as an administrative expense for goods received within 20 days of the Debtor's bankruptcy filing. The Martinez Group says it has not received payment for the goods it delivered in the ordinary course of the Debtor's business. According to the Martinez Group, the Debtor has paid other vendors their claims pursuant to Section 503(b)(9) of the Bankruptcy Code when the vendors threatened not to ship parts, which threat could disrupt the Debtor's supply chain. Martinez tells the Court that it has not done that and has continued supplying the Debtors with products postpetition. Martinez points out that it is a small company and the Debtor's continued failure to pay for the goods is causing a financial hardship on it. Toledo, OH-based Dana Corp. -- http://www.dana.com/-- designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles annually. The company and its affiliates filed for chapter 11 protection on Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio, represent the Debtors. Henry S. Miller at Miller Buckfire & Co., LLC, serves as the Debtors' financial advisor and investment banker. Ted Stenger from AlixPartners serves as Dana's Chief Restructuring Officer. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP, represents the Official Committee of Unsecured Creditors. Fried, Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the Official Committee of Equity Security Holders. When the Debtors filed for protection from their creditors, they listed $7.9 billion in assets and $6.8 billion in liabilities as of Sept. 30, 2005. (Dana Corporation Bankruptcy News, Issue No. 22; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). DANA CORP: Patti Organ Wants Stay Lifted to Pursue Insurance ------------------------------------------------------------ Patti G. Organ says she sustained injuries while working for Dana Corporation and its debtor-affiliates on Sept. 30, 2005. A Report of Injury was filed with the Missouri Division of Workers' Compensation. Ms. Organ is still being treated for her work- related injuries. She filed a Claim for Compensation with the Missouri Division of Workers' Compensation on Sept. 12, 2006. The Debtors have acknowledged that it carried a policy of Workers' Compensation Liability Insurance, which was in full force and effect at the time of Ms. Organ's accident. Ms. Organ and her counsel expect that the insurance company's defense firm will represent the Debtors' interests in the pending Workers' Compensation Claim. Accordingly, Ms. Organ asks the U.S. Bankruptcy Court for the Southern District of New York to lift the automatic stay so she can pursue her workers' compensation claim. Ms. Organ notes that the Debtors' insurance coverage is more than adequate to prevent the Debtors' personal assets from being in jeopardy. Ms. Organ assures the Court that lifting the stay will not be detrimental to the Debtors' effective reorganization. Toledo, OH-based Dana Corp. -- http://www.dana.com/-- designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles annually. The company and its affiliates filed for chapter 11 protection on Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio, represent the Debtors. Henry S. Miller at Miller Buckfire & Co., LLC, serves as the Debtors' financial advisor and investment banker. Ted Stenger from AlixPartners serves as Dana's Chief Restructuring Officer. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP, represents the Official Committee of Unsecured Creditors. Fried, Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the Official Committee of Equity Security Holders. When the Debtors filed for protection from their creditors, they listed $7.9 billion in assets and $6.8 billion in liabilities as of Sept. 30, 2005. (Dana Corporation Bankruptcy News, Issue No. 22; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). DELTA AIR: Parties Object to Lease Claims Objection Process ----------------------------------------------------------- Delta Air Lines, Inc., and its debtor-affiliates and the Official Committee of Unsecured Creditors ask the U.S. Bankruptcy Court for the Southern District of New York to approve their proposed procedures governing the manner in which they may assert and litigate certain objections to claims in connection with leveraged lease transactions, the Troubled Company Reporter reported on Oct. 3, 2006. Objections A number of owner participants and parties-in-interest to certain aircraft leveraged lease transactions object to the Debtors and the Official Committee of Unsecured Creditors' proposed procedures for filing and litigating objections to Leveraged Lease Claims: (a) a group of owner participants in 58 separate leveraged lease transactions, namely: -- Banc of America Leasing & Capital LLC, -- AT&T Credit Holdings, Inc., -- Bay 2 Bay Leasing LLC, -- Comcast Corporation, -- DFO Partnership, -- Lone Star Air Partners LLC, and -- Soundbay Leasing, LLC; (b) BNY entities, comprising: -- BNY Capital Resources Corporation, -- Lease Equities (Texas) Corporation, and -- BNY Lease Equities (Cap Funding) LLC; (c) Fifth Third Bank and The Fifth Third Leasing Company, Inc.; (d) Philip Morris Capital Corporation; (e) Pacific Harbor Capital, Inc.; AmSouth Leasing Corporation; First Hawaiian Bank; Raymond James Financial, Inc.; M&T Credit Services LLC; and Winthrop Resources Corporation; (f) General Electric Company and certain of its subsidiaries and affiliates; (g) First Chicago Leasing Corporation, Banc One Equipment Finance, Inc., and Banc One Arizona Leasing Corporation; (h) Bell Atlantic Tricon Leasing Corporation, NCC Golf Company, NCC Key Company, NCC Charlie Company and Comerica Leasing Corporation; (i) aircraft creditors represented by Vedder, Price, Kaufman & Kammholz, P.C., including Bankgesellschaft Berlin AG; Bear Stearns Investment Products, Inc.; Bremer Landesbank; and Kreditanstalt Oldenburg-Girozentrale; (j) Northwestern Mutual Life Insurance Company and Walt Disney Pictures; (k) the ad hoc committee of certain senior secured holders of certificates issued in conjunction with leveraged lease transactions involving the 79 aircraft and related equipment, and The Bank of New York, as pass through trustee and as indenture trustee; (l) Wachovia Financial Services, Inc., formerly known as First Union Commercial Corporation, successor to Wachovia Leasing Corporation; The objectors complain that the Joint Motion: -- fails to identify any particular claim to which it purports to object, and merely refer to a general description of a class of claims that it denominates as "Relevant Claims"; -- fails to specify the basis for an objection to any particular claim, and merely refers to a list of generic objections that might or might not apply to any given "Relevant Claim"; -- improperly attempts to shift the burden of going forward to claimants, requiring them to supplement their proofs of claim with sworn declarations without requiring the Debtors and the Creditors Committee to produce any evidence to rebut the prima facie validity of the claims as required by Rule 3001 of the Federal Rules of Bankruptcy Procedure; and -- proposes vague and confusing procedures. Banc of America, et al., assert that the Court and the parties will be better served if the Court treats the approval of the proposed procedures as an agenda for a Rule 7016 conference. Richard G. Smolev, Esq., at Kaye Scholer LLP, in New York, counsel for Banc of America, et al., explains that a Rule 7016 conference will facilitate a collaborative process giving all parties an opportunity to contribute to the development of procedures the Joint Motion seeks to establish. A collaboratively developed set of procedures may result in a process that ultimately would reduce transaction costs better than the proposed Procedures, Mr. Smolev says. On behalf of the BNY entities, David A. Rosenzweig, Esq., at Fulbright & Jaworski L.L.P., in New York, says that the Debtors and the Creditors Committee have filed a motion, mislabeled as one merely seeking procedures, that seeks to allow them to side step the normal claims objection process by picking and choosing test cases that will impact large numbers of creditors with significant claims. Mr. Rosenzweig asserts that the Procedures deprive creditors of their right to litigate their individual claims, even though the owner participants' tax indemnity claims are likely the largest single group of claims in the Debtors' cases aside from the claims of the labor unions and the Pension Benefit Guaranty Corporation. Mr. Rosenzweig avers that the Procedures inappropriately give the Debtors and the Creditors Committee the sole discretion to choose which claim or claims to litigate. The Procedures provide, among others, that: * the Debtors and the Committee may select a group of relevant claims for purposes of litigating one or more deemed objections; and * other parties who might be interested in the same issue may participate in the litigation of that issue. On the other hand, Mr. Rosenzweig argues, the Procedures place creditors in a difficult, if not impossible, position: (a) Creditors who will not participate in the test case may not have a meaningful opportunity to litigate in the Court; (b) Creditors participating in the test case are required to file joint papers with possibly dozens of other creditors, essentially forcing the creditors to use a common counsel, and thus, depriving each of its rights to full and fair hearing on its claims using the counsel of its choice; and (c) Participants in the test case will be bound by the decision, even though they participated essentially as amicus parties and their claims were not before the Court. Mr. Rosenzweig maintains that any notion of due process and fundamental fairness requires the Debtors to file an omnibus objection to tax indemnity claims, thus affording every creditor an opportunity to submit papers, compare operative documents for similarities and differences, and appear at hearings. In consultation with the affected creditors, the Debtors and the Creditors Committee can select a handful of claims for the initial litigation. Bell Atlantic, et al., maintain that although aircraft leveraged lease structures have many of the same general features, owner participants' tax and general indemnity claims in each transaction are governed by unique and highly negotiated documentation. According to Bell Atlantic, et al.'s counsel, Joseph J. Saltarelli, Esq., at Hunton & Williams LLP, in New York, the efficiencies to be achieved by the Procedures are largely, if not completely, illusory. Common themes do not always translate into common issues that lend themselves to common resolution. Philip Morris does not oppose a process by which the Court addresses in an orderly and efficient fashion the disputes over claims based on stipulated loss value and payments required under Tax Indemnity Agreements, and the separate TIA claims, provided that the process protects the rights of all affected parties and ensures a level playing field for the litigation. Philip Morris asks the Court to deny the Joint Motion as being premature unless: i. prior to the establishment of a claim objection process, the Debtors and the Creditors Committee file proper claim objections that set the factual and legal basis of their objections, and identify the creditors subject to each objection; and ii. subsequent to the filing of the claim objections, the Court holds a status conference for the purpose of determining whether it is possible to establish procedures that will govern the manner in which an objection is litigated, at which hearing creditors will have the right to be heard. Pacific Harbor, et al., propose that the Debtors and the Creditors Committee implement these changes to the Procedures: (1) To ensure that all affected parties receive adequate notice of the claims at issue that will permit them to determine easily whether the claims relate to a claimant's respective aircraft, the notices will include: * the claim numbers of each claim subject to the notice; * the FAA registration number for each aircraft subject to the claims; and * the name and address of each respective claimant; (2) The Debtors and the Creditors Committee will comply with the requirements of Bankruptcy Rules 3007 and 7004, and relevant case law, which require that a claim objection be served by first class U.S. mail on the claimant's designated notice party at the address specified on the face of each respective claimant's proof of claim; and (3) Claimants will be provided sufficient time to respond to the Debtors and the Creditors Committee's leveraged lease claims objection. On behalf of the GE Entities, Richard P. Krasnow, Esq., at Weil, Gotshal & Manges LLP, in New York, argues that: -- the Court should not "deem" the Joint Motion as an objection to claims; and -- the proposed Procedures infringe on the claimants' due process rights. First Chicago Leasing contends, among others, that the Procedures should be modified to provide: (a) a reservation of a party's rights to appeal the Court's decision; (b) an overly expansive waiver of conflicts of interest; (c) that the litigation of a deemed objection will not have res judicia, collateral estoppel or other preclusive effect on the holders of relevant claims; and (d) no penalty to be imposed for failure of respondents to file joint papers with respect to the litigation of a deemed objection. CLC Aircraft Leasing Company supports the objections of the other parties, including the BofA, et al., and the BNY Entities. 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. 45; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELTA AIR: Aircraft Creditors Balk at Claims Objection Procedures ----------------------------------------------------------------- Delta Air Lines, Inc., and its debtor-affiliates ask the United States Bankruptcy Court for the Southern District of New York to establish uniform procedures for filing, prosecuting and resolving objections to proofs of claim filed in their Chapter 11 cases, pursuant to Section 105 of the Bankruptcy Code, the Troubled Company Reporter reported on Oct. 3, 2006. David H. Botter, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, tells the Court that the Official Committee of Unsecured Creditors supports the Debtors' request to establish uniform procedures for filing, prosecuting and resolving objections to proofs of claim filed in their Chapter 11 cases. Aircraft Creditors Object Certain aircraft creditors, including Bankgesellschaft Berlin AG; Bear Steams Investment Products, Inc.; Bremer Landesbank; and Kreditanstalt Oldenburg-Girozentrale, want the proposed Objection Procedures revised to: (1) provide claimants adequate time after a reply has been filed by the Debtors to prepare for the hearing on that objection; (2) require the Debtors to prepare a concise statement setting forth the basis for any objection; (3) allow both the Debtors and the claimants to determine what, if any, discovery will be needed to resolve a claim objection, and to convert the initial scheduled hearing into a status conference; and (4) allow either the Debtors or the claimants to schedule a claim for a hearing. Representing the Aircraft Creditors, Douglas J. Lipke, Esq., at Vedder, Price, Kaufman & Kammholz, P.C., in Chicago, Illinois, asserts that the claimants should not be required to file an additional sworn declaration as part of any response to a claim objection. The Allegheny County Airport Authority; Wachovia Financial Services, Inc., formerly known as First Union Commercial Corporation; Fifth Third Bank; The Fifth Third Leasing Company, Inc.; and CLC Aircraft Leasing Company support the Aircraft Creditors' objection. 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. 45; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DIRECTED ELECTRONICS: Polk Audio Buy Cues S&P to Lower Ratings -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on consumer electronics maker Directed Electronics Inc. following its acquisition of Polk Audio Inc., a provider of loudspeakers and audio equipment for homes and cars, for $136 million in cash. The corporate credit rating was lowered to 'B+' from 'BB-', and was removed from CreditWatch negative where it was placed on Aug. 25, 2006. The ratings outlook on Vista, California-based DEI is stable. Pro forma balance sheet debt at June 30, 2006, including the acquisition debt, totaled about $307 million. "The downgrade reflects DEI's weaker financial position after the Polk acquisition," said Standard & Poor's credit analyst Nancy C. Messer. To fund the acquisition, the company increased the size of its term loan by $141 million under an amended and restated senior secured credit facility. This amount was an addition to the company's existing $165.8 million term loan. At the same time that debt is increased, DEI will be required to invest in higher levels of working capital in the next several years to support its product build for the satellite radio accessories market. As a result of the higher cash interest expense and required investment in working capital, the company will generate minimal free cash flow for debt reduction in 2006 and 2007. Beginning in 2008, the company expects to generate sufficient free cash flow to allow for debt reduction. Following the acquisition, DEI is highly leveraged, with lease-adjusted total debt to EBITDA of about 4.4x. S&P expects DEI's lease-adjusted leverage to remain at 4x or higher over the intermediate term, as the company expands and diversifies sales through new product introductions and possible periodic acquisitions. The Polk acquisition, which will increase DEI's revenues by a material 25%, adds integration risk to the credit, although mitigating this concern is DEI's successful track record of integrating prior acquisitions. At the 'B+' rating, S&P expects funds from operations to total debt in the range of 10%-15% and lease-adjusted total debt to EBITDA in the range of 4x-4.5x. The Polk acquisition is consistent with DEI's strategy of growing both organically and through acquisitions in home electronics, mobile electronics, and adjacent product categories to leverage DEI's existing distribution network, customer relationships, and sales force, since the markets are highly fragmented. EATON VANCE: S&P Affirms BB- Rating on Class D Notes ---------------------------------------------------- Standard & Poor's Ratings Services raised its rating on the class B notes issued by Eaton Vance CDO III Ltd., a cash flow arbitrage high-yield CLO transaction, and removed it from CreditWatch, where it was placed with positive implications on July 27, 2006. At the same time, ratings are affirmed on the class A and D notes. The upgrade is primarily due to the increase in the overcollateralization ratios following paydowns to the class A-1 and A-2 notes after the end of the reinvestment period in August 2005. Currently, the outstanding balances of the class A-1 and A- 2 notes are 41.74% of their amounts at issuance. As a result, the overcollateralization ratios for the A and B classes improved to 157.35% and 126.37%, respectively, as of Aug. 31, 2006. These ratios are significantly higher than the initial ratios of 129.36% and 117.35%, respectively. Though the class D overcollateralization ratio had declined to 102.33% as of Aug. 31, 2006, from an initial value of 105.65%, it remains above its minimum requirement of 101.70%. Moreover, for purposes of calculating the overcollateralization ratios, Eaton Vance CDO III Ltd. "haircuts" (or reduces the principal value of) a percentage of assets that have a legal maturity beyond the stated maturity of the transaction. According to the Aug. 31, 2006, trustee report, the overcollateralization ratios included a $6.68 million haircut to the numerator. Without haircutting the principal value of these assets, the class D overcollateralization ratio, as of the August 2006 monthly report, would have been approximately 105.76% instead of 102.33%. Based on the current credit support for the class D notes, the current rating is affirmed. Considering that the credit quality of the portfolio has declined since the transaction closed, however, we will consider placing the class D rating on CreditWatch negative if support for this class deteriorates in any manner, including a negative rating migration within the collateral pool, credit risk sales that are less than the assumed recovery, or a reduction in net interest revenue following early amortization of assets. Rating Raised and Removed from Creditwatch Positive Eaton Vance CDO III Ltd. Rating ------ Class To From ----- -- ---- B AAA A-/Watch Pos Ratings Affirmed Eaton Vance CDO III Ltd. Class Rating ----- ------ A-1 AAA A-2 AAA D BB- E.SPIRE COMMS: Ch. 7 Trustee Hires Rawle & Henderson as Co-Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware gave Gary F. Seitz, Esq., the chapter 7 trustee appointed in e.Spire Communications, Inc. and its debtor-affiliates' liquidation proceedings, permission to employ Rawle & Henderson LLP, as his co-counsel. As reported on the Troubled Company Reporter on Oct. 2, 2006, Rawle & Henderson will: a) provide legal advice with respect to the Chapter 7 trustee's powers and duties under the Bankruptcy Code; b) assist in the investigation of the Debtors' acts, conduct, assets, liabilities, and financial condition, the operation of the Debtors' businesses, and any other matters relevant to the case or the orderly liquidation of the estates' assets; c) prepare, on behalf of the Chapter 7 Trustee, necessary applications, motions, complaints, answers, orders, agreements and other legal papers; d) review, analyze, and respond to all pleadings filed in these Chapter 7 cases and appear in court to present necessary motions, applications and pleadings and to otherwise protect the interests of the Chapter 7 Trustee and the Debtors' estates; and e) perform all other legal services for the Chapter 7 Trustee that may be necessary and proper in these proceedings. Rawle & Henderson's professionals bill at these rates: Designations Hourly Rate ------------ ----------- Partners $300-$400 Associates $150-$300 Paralegals $75-$150 Paralegal Assistants $75-$150 To the best of the Trustee's knowledge, the firm does not hold any interest adverse to the Debtors' or their estates. Attorneys at the firm can be reached at: Rawle & Henderson LLP 300 Delaware Avenue Suite 1015 Wilmington, Delaware 19801 Tel: (302) 654-0500 http://www.rawle.com/ Headquartered in Columbia, Maryland, e.Spire Communications was a facilities-based integrated communications provider, offering traditional local and long distance Internet access throughout the United States. The Company and its debtor-affiliates filed for chapter 11 protection on March 22, 2001 (Bankr. Del. Case No. 01-00974). Chad Joseph Toms, Esq., and Domenic E. Pacitti, Esq., at Saul Ewing LLP, and James E. O'Neill, Esq., at Pachulski, Stang, Ziehl, Young & Jones, represented the Debtors in their chapter 11 proceedings. The Court converted the Debtors' chapter 11 cases to chapter 7 liquidation proceedings on May 6, 2006. Francis A. Monaco Jr., Esq., and Joseph J. Bodnar, Esq., at Monzack and Monaco, P.A., represented the Official Committee of Unsecured Creditors prior to the Debtors' cases being converted to chapter 7. When the Debtors filed for protection from their creditors, they listed $911.2 million in total assets and $1.4 billion in total debts. Gary F. Seitz, Esq., formerly the Court-appointed Chapter 11 Trustee, has also been appointed as the Chapter 7 Trustee in the Debtors' liquidation proceedings. Daniel K. Astin, Esq., and Anthony M. Saccullo, Esq., at The Bayard Firm; Erin Edwards, Esq., at Young Conaway Stargatt & Taylor LLP; and Deirdre M. Richards, Esq., at Obermayer Rebmann Maxwell & Hippel LLP, represent Mr. Seitz. FEDERAL-MOGUL: Insurers Want Dresser Case Heard in State Court -------------------------------------------------------------- Insurance Companies, related to asbestos-related claims against Federal-Mogul Products, Inc., ask the U.S. District Court for the District of Delaware to abstain from hearing the Dresser Adversary Proceeding and to withdraw the reference of their Lift-Stay Motion from the Bankruptcy Court. Federal-Mogul Products asserts rights to insurance coverage for asbestos-related claims under a large number of insurance policies issued by various insurers. In 2001, DII Industries, LLC, formerly Dresser Industries, Inc., commenced an adversary proceeding claiming coverage under the same policies. Ordinarily, a dispute involving application of state law would be litigated in state court, Brian L. Kasprzak, at Marks O'Neill O'Brien & Courtney, P.C., in Wilmington, Delaware, says on behalf of certain insurance companies. However, because DII commenced the Adversary Proceeding in F-M Products' Chapter 11 case, the issues involving the Debtor's rights to insurance coverage for asbestos claims were brought in the Bankruptcy Court, Mr. Kasprzak recounts. While the parties engaged in an extensive mediation, the U.S. District Court for the District of Delaware stayed the Adversary Proceeding, Mr. Kasprzak relates. Currently, however, the stay has been lifted and F-M Products wishes to proceed with coverage litigation. The Insurers believe that the state court is still the most appropriate forum for litigation of the coverage disputes. Accordingly, the Insurers ask the Bankruptcy Court to lift the automatic stay so they can promptly commence and prosecute an insurance coverage lawsuit in the Supreme Court of the State of New York, New York County. The state court suit, Mr. Kasprzak says, will substitute for the Adversary Proceeding, except in a more appropriate forum. The Insurers believe that lifting the automatic stay will not interfere with the orderly administration of F-M Products' case or its efforts to reorganize. "The litigation will impose the same burdens on [the] Debtor and its estate wherever it proceeds; if having active coverage litigation in federal court will not interfere with [the] Debtor's bankruptcy case or its efforts to confirm a plan, having the same litigation go forward in state court also would not have those effects," Mr. Kasprzak asserts. Furthermore, Mr. Kasprzak contends that: -- the planned state court coverage action is likely to succeed on the merits; -- if the Lift Stay Motion is denied, the Insurers will suffer hardship; and -- neither F-M Products nor its estate will suffer prejudice if the stay is lifted. Insurers Want District Court to Abstain The Dresser Adversary Proceeding now presents nothing more than a routine insurance coverage dispute, Mr. Kasprzak tells the District Court. The issues in the Adversary Proceeding only concern whether or to what extent insurance coverage exists under prepetition liability insurance policies for F-M Products, Mr. Kasprzak explains. The specific issues include choice of law, corporate successorship or named insured issues, trigger and allocation issues, and other issues requiring interpretation and construction of the insurance policies. The Insurers believe those issues arise exclusively under state law and are non-core. "They have nothing to do with bankruptcy law, and would be most appropriately considered by a state court," Mr. Kasprzak contends. Furthermore, the Insurers believe that the issues can be timely adjudicated in state court since the feasibility of the Debtor's proposed plan of reorganization in no way depends on the outcome of an insurance coverage litigation. Hence, the Insurers ask the District Court to abstain from hearing the Adversary Proceeding. "It has become commonplace for federal courts to abstain from insurance coverage suits involving debtors so the state-law matters involved can be heard in state court, as Congress intended" Mr. Kasprzak says. Insurers Ask District Court to Withdraw Reference The Insurers further ask the District Court to withdraw the reference of their Lift-Stay Motion from the Bankruptcy Court, so that a single judicial officer from the District Court can decide both the Abstention Motion and the Lift-Stay Motion, which are interrelated. "Hearing those motions together further fosters economical use of [the] Debtor's and the insurance companies' resources and expedites the bankruptcy process," Mr. Kasprzak points out. The Insurers believe that failure to withdraw the reference could result in inconsistent rulings by the District Court and the Bankruptcy Court. The Insurers include: -- Ace Property & Casualty Insurance Company, -- Century Indemnity Company, -- Central National Insurance Company of Omaha, -- Pacific Employers Insurance Company, -- Insurance Company of North America, -- OneBeacon America Insurance Company, -- Seaton Insurance Company, -- St. Paul Mercury Insurance Company, -- Stonewall Insurance Company, -- TIG Insurance Company, and -- United States Fire Insurance Company. 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). FEDERAL-MOGUL: Underwriters to Reply on Travelers' Objection ------------------------------------------------------------ Certain Underwriters at Lloyd's, London, and Certain London Market Companies obtained permission from the U.S. Bankruptcy Court for the District of Delaware to file a reply to The Travelers Indemnity Company and Travelers Casualty and Surety Company's objection to the Underwriters' request for discovery concerning Vellumoid and Fel-Pro Claims. The Travelers Objection has been filed under seal because Travelers obtained information from American Standard, Inc. v. Admiral Insurance Co., et al., Docket No. MID-K-1429-99, pending in the Superior Court of New Jersey, which case is purportedly subject to a protective order and mediation protocol. Among others, Travelers argued that the Underwriters' discovery request was drawn from certain confidential information provided in the American Standard Case. Because some information may be confidential, the Court also authorized the Underwriters to file their reply under seal. The Court limits the Underwriters' Reply to 10 pages, including any exhibits. 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). FLAGSTONE CBO: Fitch Holds BB Rating on $10.3 Mil. Class B-1 Notes ------------------------------------------------------------------ Fitch Ratings affirms three classes of notes issued by Flagstone CBO 2001-1 LTD. These affirmations are the result of Fitch's review process and are effective immediately: -- $139,756,506 class A-1L notes at 'AAA'; -- $72,500,000 class A-2L notes at 'AAA'; -- $10,335,147 class B-1 notes at 'BB'. Flagstone, which closed Oct. 18, 2001, is a collateralized debt obligation initially managed by Pareto Partners. Pareto Partners was acquired by Standish Mellon which currently manages the transaction. Since the last rating action, the WARF has slightly deteriorated; excluding defaults, assets rated 'CCC+' or lower represented approximately 17.86% of the aggregate principal amount of portfolio collateral plus eligible investments relative to 15.20% from a year ago; however, Flagstone continues to perform in line with Fitch's original ratings expectations. As of the Sept. 2, 2006 trustee report, the class A overcollateralization ratio has improved to 115.20% from 110.33% over a one-year period, relative to a minimum required threshold of 106.75%. Also, the class B OC ratio has improved to 109.60% from 104.50% over an approximate one-year period, relative to a minimum required threshold of 104.00%. Several important structural safeguards will help support the credit enhancement of the rated liabilities. For example, if the additional collateral amount test fails the minimum required level of 107.5% based on the class B OC test, this will result in the diversion of interest proceeds towards principal redemptions of the class B-1 notes and the redemption of senior notes. The amount necessary to cure this test is applied 25% to redeem the class B-1 notes and 75% applied to redeem all the notes sequentially. The structure also includes more traditional class A and B OC tests as well as an interest coverage test. The ratings of the classes A-1L and A-2L notes, which are both guaranteed for interest and principal by XL Capital Assurance Inc., address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the stated balance of principal by the legal final maturity date. The rating of the class B-1 note addresses the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the stated balance of principal by the legal final maturity date of Nov. 15, 2013. As a result of this analysis, Fitch has determined that the original ratings assigned to the class A-1L, A-2L, and B-1 notes still reflect the current risk to noteholders. Fitch will continue to monitor and review this transaction for future rating adjustments. FLYI INC: Judge Walrath Adjourns Disclosure Statement Hearing ------------------------------------------------------------- In a notice filed with the U.S. Bankruptcy Court for the District of Delaware, FLYi, Inc., and its debtor-affiliates disclose that Judge Mary F. Walrath adjourned to "a date to be determined" the hearing to consider the approval of: (i) the Disclosure Statement explaining the Debtors' Joint Plan of Liquidation; and (ii) the Debtors' motion to establish uniform procedures for the solicitation and tabulation of votes to accept or reject the Plan of Liquidation. The Debtors will file a subsequent notice with the Court setting forth the adjourned hearing dates. The hearing was initially scheduled on Oct. 3, 2006. 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. 26; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). FLYI INC: Wants Removal Period Extended to January 31 ----------------------------------------------------- FLYi, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware, to further extend the time period within which they may file notices of removal, through and including January 31, 2007, with respect to pending prepetition civil actions. The extension will afford the Debtors additional time to determine whether or not to remove any pending civil action and will ensure that the Debtors do not forfeit their rights under Section 1452 of the Judiciary and Judicial Procedure Code, M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, contends. Mr. Cleary assures the Court that the extension will not prejudice the rights of the Debtors' adversaries because any party to a removed action may seek to have the action remanded to the state court pursuant to Section 1452. The Court will convene a hearing on October 23, 2006, to consider the Debtors' request. By application of Local Bankruptcy Rule 9006-2 for the District of Delaware, the deadline is automatically extended until the Court rules on the Debtors' request. 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. 26; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). FOAMEX INT'L: Exclusive Plan Filing Period Extended to November 15 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware extends Foamex International Inc. and its debtor-affiliates' exclusive periods: (i) to file a Chapter 11 plan through and including Nov. 15, 2006; and (ii) to solicit acceptances for the plan through and including Jan. 14, 2006, upon consideration of Murray Capital's objections and the Debtors' agreement to modify their request as a result of negotiations with interested parties. Judge Walsh also orders that the discovery served by the Creditors Committee on Sept. 22, 2006, with respect to the 3rd Exclusivity Motion will remain outstanding and will be treated as a request for discovery under Rule 2004 of the Federal Rules of Bankruptcy Procedure. Judge Walsh overrules Murray Capital's objections. Murray Capital's Objections Representing Murray Capital Management, Inc., Mark D. Olivere, Esq., at Edwards Angell Palmer & Dodge LLP, in Wilmington, Delaware, argues that the Debtors cannot demonstrate "cause" for an extension of their exclusive periods to file a plan of reorganization and solicit acceptances for the plan. Mr. Olivere notes that the Debtors have a fully negotiated and committed exit-financing package, which should allow them to file a plan immediately. The Debtors sought an extension to allow them time to complete negotiations with certain of their equity holders with respect to the terms of a potential rights offering. Mr. Olivere, however, points out that certain, if not all, of the equity holders have been owners of the Debtors' equity for at least six months, have been actively involved in the Debtors' Chapter 11 cases, and have had ample time to finalize their due diligence. The equity holders are large and sophisticated investors who can execute transactions with considerable speed when committed to doing so, he says. Thus, the equity holders should either commit to a plan promptly or get out of the Debtors' way, Mr. Olivere asserts. Declining to extend the Debtors' exclusivity, or limiting an extension to no more than 21 days, will not prejudice the Debtors' ability to file a plan and solicit its acceptance, Mr. Olivere maintains. Mr. Olivere notes that Section 1121 of the Bankruptcy Code does not impose a deadline for filing a plan but merely limits the Debtors' exclusive rights with respect to the plan and affords stakeholders the opportunity to submit a competing plan for all holders of claims and equity interests to evaluate. All parties-in-interest would remain free to evaluate and to vote on either the Debtors' eventual plan or a plan put forth by one or more of their stakeholders, Mr. Olivere further notes. Denial of the Third Exclusivity Motion, Mr. Olivere contends, will effectively level the playing field among competing constituencies like the Debtors and their creditors and equity holders. Murray Capital submits that a further extension of the Exclusive Periods will be detrimental to the Debtors' estates, and the Third Exclusivity Motion should be denied. To the extent the Debtors are able to put forth additional evidence indicating substantial progress towards a plan, Murray Capital maintains that the Debtors should be allowed no more than a 21-day extension in their Exclusive Plan Filing Period. Foamex Submits Evidence on Negotiations with Equity Holders At a hearing on October 5, 2006, Foamex International, Inc., presented to the Court evidence that outlined recent developments in the Debtors' Chapter 11 cases, according to the company's Form 8-K submitted to the Securities and Exchange Commission. According to Gregory J. Christian, executive vice president and general counsel, Foamex is in continuing negotiations with certain significant equity holders. The parties are negotiating terms of a potential rights offering that would raise additional equity financing that, when coupled with proceeds from Foamex's Chapter 11 exit loans, would allow it to satisfy the valid claims of creditors in full and allow equity holders to retain their ownership interests in the company, subject to any dilution that may occur in connection with a rights offering to the current equity holders. 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. 28; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FORD MOTOR: Could be Next in Renault-Nissan's Quest for Alliance ---------------------------------------------------------------- Nissan Motor Co. Ltd and Renault could set their sights on Ford Motor Company as they continue to look for a North American partner, Reuters Reports. Nissan spokeswoman Mia Nielsen had told Reuters that the Renault- Nissan alliance could be extended to work with additional partners and that a North American partner could make sense. Renault-Nissan had sought to form a partnership with General Motors Corp. in order to strengthen its position in North America. GM however, ended the talks after concluding that Renault-Nissan's alliance framework would substantially disadvantage GM shareholders. Headquartered in Dearborn, Michigan, Ford Motor Company -- http://www.ford.com/-- manufactures and distributes automobiles in 200 markets across six continents. With more than 324,000 employees worldwide, the company's core and affiliated automotive brands include Aston Martin, Ford, Jaguar, Land Rover, Lincoln, Mazda, Mercury and Volvo. Its automotive-related services include Ford Motor Credit Company and The Hertz Corporation. * * * As reported in the Troubled Company Reporter on Aug. 22, 2006, Dominion Bond Rating Service placed long-term debt rating of Ford Motor Company Under Review with Negative Implications following announcement that Ford will sharply reduce its North American vehicle production in 2006. DBRS lowered on July 21, 2006, Ford Motor Company's long-term debt rating to B from BB, and lowered its short-term debt rating to R-3 middle from R-3 high. DBRS also lowered Ford Motor Credit Company's long-term debt rating to BB(low) from BB, and confirmed Ford Credit's short-term debt rating at R-3(high). Fitch Ratings also downgraded the Issuer Default Rating of Ford Motor Company and Ford Motor Credit Company to 'B' from 'B+'. Fitch also lowered the Ford's senior unsecured rating to 'B+/RR3' from 'BB-/RR3' and Ford Credit's senior unsecured rating to 'BB- /RR2' from 'BB/RR2'. The Rating Outlook remains Negative. Standard & Poor's Ratings Services also placed its 'B+' long-term and 'B-2' short-term ratings on Ford Motor Co., Ford Motor Credit Co., and related entities on CreditWatch with negative implications. As reported in the Troubled Company Reporter on July 24, 2006, Moody's Investors Service lowered the Corporate Family and senior unsecured ratings of Ford Motor Company to B2 from Ba3 and the senior unsecured rating of Ford Motor Credit Company to Ba3 from Ba2. The Speculative Grade Liquidity rating of Ford has been confirmed at SGL-1, indicating very good liquidity over the coming 12-month period. The outlook for the ratings is negative. GENERAL MOTORS: S&P Retains Watch After Nissan-Renault Talks End ---------------------------------------------------------------- Standard & Poor's Ratings Services said that its 'B' long-term and 'B-3' short-term corporate credit ratings on General Motors Corp. would remain on CreditWatch with negative implications, where they were placed March 29, 2006. The CreditWatch update follows the announcement that GM, Nissan Motor Co. Ltd., and Renault S.A. are no longer in talks to explore a global automotive partnership. S&P had not factored any potential benefits of an alliance into GM's ratings. "Although such an alliance might have brought some cost savings in manufacturing, purchasing, or marketing," said Standard & Poor's credit analyst Robert Schulz, "any benefits would likely have taken a long time to materialize and would have been accompanied by substantial execution risks, given the complexity involved." GM's ratings are likely to remain on CreditWatch until S&P is able to ascertain the financial effect on GM of its exposure to bankrupt former unit Delphi Corp., and until the sale of a 51% stake in GMAC LLC (formerly General Motors Acceptance Corp.) to an investor consortium is at or near completion. S&P believes the Delphi situation will be resolved first, although resolution is not required for the GMAC sale. Beyond these events, S&P will focus on GM's progress in improving its troubled North American automotive operations. The possibility that Kirk Kerkorian's Tracinda Corp. will increase its ownership stake in GM to about 12% from 9.9% could increase pressure on management to shift from existing strategies. However, given Tracinda's existing board representation, the potential effect of a higher stake is not likely to be a significant factor in the CreditWatch resolution. GM is suffering from meaningful market share erosion in the U.S. and marked deterioration of its product mix, most notably a precipitous weakening of sales of its midsize and large SUVs. These negative trends have vividly exposed the extent of capacity and cost challenges that need to be addressed in North America. GM is undertaking yet another significant round of cost reductions, production capacity cuts, and workforce rationalization. Yet, sustainable improvements in North America will also require success with product acceptance and pricing, in addition to cost reductions. Some -- but not all -- new products launched in 2006 are selling well. Prospects for GM's important late 2006 launch of a new full-size pickup truck are uncertain, given softness and competition in that segment. Executed cost reductions include the negotiation of an agreement with the United Auto Workers providing for reduced health care costs. Yet, this agreement will only partly address the competitive disadvantage posed by GM's health care burden. Moreover, cash savings will not be realized until 2008 because GM agreed to make a total of $2 billion in contributions to a newly formed VEBA trust during 2006 and 2007. GM is also substantially reducing headcount through an accelerated attrition plan under which more than 34,000 hourly employees have agreed to leave. Although up to 5,000 Delphi employees can return to GM, GM will reach its 2008 goal of reducing 30,000 manufacturing jobs about two years early. GM took a net after-tax charge in the second quarter of about $3.7 billion related to the attrition program. The most pressing near-term issue remains GM's exposure to Delphi, its former unit and important supplier. Hearings on Delphi's request to reject its labor contracts and unprofitable supply contracts with GM have been postponed a number of times during 2006, although S&P expects negotiations between Delphi, the United Auto Workers, and GM to continue. The court has scheduled a conference for Oct. 19. We expect a resolution that does not entail a Delphi strike, partly because Delphi's attrition program was also very successful, but also because a strike would be catastrophic for GM. Delphi's much lower headcount is likely to be an important factor in resolving GM's exposure to the Delphi situation. Deterioration of GM's credit quality has limited GMAC's funding capabilities, and GM has agreed to sell a 51% ownership stake in GMAC to a consortium headed by unrated Cerberus Capital Management. If the sale is completed, net cash proceeds to GM at closing are expected to be about $8 billion, which represents about $10 billion received by closing less amounts reinvested in GMAC as part of the transaction. These proceeds would bolster GM's liquidity significantly. Several key closing conditions have recently been satisfied. However, the consortium is now considering how to deal with an unexpected six-month FDIC moratorium on approving ownership changes affecting industrial loan companies to avoid delaying the targeted closing date of late 2006. GOODING'S SUPERMARKETS: Files Amended Disclosure Statement ---------------------------------------------------------- Gooding's Supermarkets Inc. delivered its Amended Disclosure Statement explaining its Amended Plan of Reorganization to the U.S. Bankruptcy Court for the Middle District of Florida, Orlando Division. Plan Implementation The Plan contemplates that the Reorganized Debtor will continue to maintain a centralized corporate administrative office, with low operating expenses, which shall operate the Reorganized Debtor's business. The Debtors believe cash flow from the continued operation of its business will be sufficient to meet required Plan Payments. Funds generated from operations until the effective date will be used for Plan Payments. In addition, the Debtor believes that it is highly likely that it will recover a significant amount of funds in the Celebration Litigation filed against two of its Landlords, Water Tower and Unicorp, and that the recovery will be used to supplement required Plan Payments. Celebration Litigation Water Tower Retail, LLC, leased a real property, where the Celebration Store was constructed in June 2005, to Gooding's under a Reinstated Ground Lease. Gooding's closed the Celebration Store in October 2005 and terminated the Ground Lease on Nov. 1, 2005, after the landlords, Water Tower and Unicorp National Developments, Inc., failed to cure defaults asserted by Gooding's, pursuant to a written notice, regarding visibility and signage issues required under the Ground Lease. Water Tower commenced a lawsuit against Gooding's for eviction and breach of lease agreement, while Gooding's sued Water Tower for breach of Ground Lease agreement. As a counterclaim, Water Tower sought damages and an order of eviction. Treatment of Claims Holders of all Allowed Administrative Expense Claims will be paid in full, except to the extent that the holder and the Reorganized Debtor have agreed or may agree to a different treatment. Holders of all Allowed Priority Tax claims will be paid in full in quarterly payments for six years with 8% interest. First National Bank's Claim The Debtor discloses that the Class 1 Allowed Secured Claim of First National Bank of Central Florida, totaling $1,560,000, has been satisfied through a compromise and sale of the Casselberry Store to Greater Properties, Inc. As reported in the Troubled Company Reporter on Aug. 11, 2006, the Court allowed the Debtor to sell the combination food and drug store consisting of approximately 46,000 square feet of commercial space located at 1024 E. Highway 436, Casselberry, Fla., to Greater Properties and The Greater Construction Corp., the lessors who own the real property upon which the Casselberry Store is situated. Greater Properties will pay $1.6 million for the store. The Class 2 Allowed Secured Claim of First National, totaling $2,560,000, is secured by a first priority Lien on the leasehold interest in the Celebration Store and an interest in all of the Debtor's right, title, and interest, now or hereafter acquired by the Debtor, in and to all leases, agreements of sale, or other agreements in connection with the Celebration Store and the rents, issues, and profits payable. The Debtor discloses that it recently executed a Conditional Mediated Settlement with respect to the litigation against Water Tower resolving all issues regarding First National's Class 2 Claim. If the Water Tower Settlement is consummated, First National will receive $2.3 million, in full satisfaction, release and discharge of its Class 2 Claim. Otherwise, in full satisfaction of its Allowed Secured Claim, First National will retain its Lien against its current collateral and receive monthly payments at the contract rate of interest, beginning on the effective date. First National will also receive a lien on the Celebration Litigation. To the extent of any Net Recovery from the Celebration Litigation, First National will receive 75% of any Net Recovery up to the first $2 million and then 80% of any Net Recovery above $2 million, until the Allowed Class 2 Claim is paid in full. Other Secured Claims In full satisfaction of its claim, National Commerce Bank is deemed to have a $1,550,000 Allowed Secured Claim. National Commerce's claims will be paid monthly based on a 12-year amortization and 7-year maturity with 7.5% fixed-rate interest. The Allowed Secured Claim of Ford Motor Credit, consisting of two auto loans will receive these treatments: * the $25,745.05 loan will receive a $462.01 monthly payment with 2.9% interest until fully paid; and * the $25,501.58 loan will receive a $481.04 monthly payment with 4.9% interest until fully paid. The Allowed Secured Claim of Russell Doerk, president, COO, and director of Gooding's, against the Debtor with respect to his right of setoff will be settled between the Debtor and Mr. Doerk. The Allowed Secured Claim of Crane National Vendors, totaling $52,978.05, will receive a first payment of $2,670.98 on the effective date, and subsequent monthly payments in two years with 10.5% interest. Crane will also retain its lien on certain vending machines located at the International Drive Store and the Lake Buena Vista Store. The Debtor will pay $2,700 attorneys' fees incurred by Crane through monthly payments of $112.50. Unsecured Claims Holders of Allowed Unsecured Claims, estimated between $2,500,000 to $3,000,000, will receive their pro rata share of the Gooding's Creditors Trust. The Gooding's Creditors Trust will hold, prosecute and liquidate the Trust Assets for the Benefit of Allowed Unsecured Claims, and will make distributions pursuant to the Plan. The assets of the Trust consist of: a) the Guaranteed Payment; b) the Periodic Payments; c) a portion of Net Recovery; d) Causes of Action; and e) all unclaimed property. The Trust will receive 25% of the first $2 million of Net Recovery from the Celebration Litigation. Thereafter, the Trust will get 20% of Net Recovery after the Class 2 Claim of First National is paid in full. Thereafter, the Trust will receive 50% of Net Recovery from the Celebration Litigation until the Trust has received a total of $1,500,000. CEO Jonathan Gooding, who owns 95.69% of common stock, and Company President Russell Doerk, who owns 4.31% of common stock, will retain their ownership in Gooding's. About Gooding's Headquartered in Orlando, Florida, Gooding's Supermarkets, Inc., dba Gooding's, offers catering services and operates a chain of supermarkets in Central Florida. The Company filed for chapter 11 protection on Dec. 30, 2005 (Bankr. M.D. Fla. Case No. 05-17769). R. Scott Shuker, Esq., at Gronek & Latham LLP represents the Debtor. W. Glenn Jensen, Esq., at Akerman Senterfitt represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets of $1 million to $10 million and debts of $10 million to $50 million. GORDON MEISEL: Case Summary & Nine Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Gordon R. Meisel Diane L. Meisel 1270 Henderson Howell, MI 48855 Bankruptcy Case No.: 06-32273 Chapter 11 Petition Date: October 9, 2006 Court: Eastern District of Michigan (Flint) Judge: Daniel S. Opperman-Flint Debtors' Counsel: Jennifer L. Brant, Esq. Tishoff & Associates PLLC 407 North Main Street Ann Arbor, MI 48104-1127 Tel: (734) 663-4077 Estimated Assets: $500,000 to $1 Million Estimated Debts: $1 Million to $10 Million Debtors' Nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Parish Corp. Promissory Note $900,000 c/o Hanes & Associates 612 West Lake Lansing Road Suite 400 East Lansing, MI 48823 Tel: (517) 324-8700 Union Bank $70,814 140 East Road Dimondale, MI 48821 AAA Visa Credit Card Debt $13,778 P.O. Box 15288 Wilmington, DE 19886 Discover Credit Card Debt $9,525 P.O. Box 15251 Wilmington, DE 19886 MBNA Visa Credit Card Debt $6,382 P.O. Box 15137 Wilmington, DE 19886 Sears Master Card Credit Card Debt $952 Amoco Credit Card Debt $835 Discover Platinum Credit Card Debt $350 Citgo Credit Card Debt $104 GREENWICH CAPITAL: S&P Affirms Low-B Ratings on Three Certificates ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its ratings on 10 classes of commercial mortgage pass-through certificates from Greenwich Capital Commercial Funding Corp.'s series 2003-C2. Concurrently, ratings are affirmed on nine other classes from the same transaction. The raised and affirmed ratings reflect credit enhancement levels that adequately support the ratings, as well as the defeasance of 13% of the collateral pool. As of the Sept. 8, 2006, remittance report, the collateral pool consisted of 80 loans with an aggregate trust balance of $1.704 billion, compared with 80 loans with a balance of $1.74 billion at issuance. The master servicer, Wachovia Bank N.A., provided primarily year-end financial information for 96% of the pool, excluding the defeased loans. Based on this information, Standard & Poor's calculated the weighted average debt service coverage (DSC) to be 1.69x for the pool, compared with 1.67x at issuance. All of the loans in the pool are current except for one that is with the special servicer, LNR Partners Inc. A $1.5 million appraisal reduction amount (ARA) related to this loan is in effect. To date, the trust has not experienced any losses. For year-end 2005, the top 10 loan exposures in the pool secured by real estate had an aggregate outstanding balance of $710 million (42%) and a weighted average DSC of 1.88x, down slightly from 1.92x at issuance. The decline in DSC is primarily due to the substantial decrease in net cash flow since issuance of the sixth-largest loan, which is on the master servicer's watchlist and is discussed below. Standard & Poor's reviewed property inspections provided by Wachovia for all of the assets underlying the top 10 exposures, and all were characterized as "good" or "excellent." At issuance, the largest loan in the pool, which is secured by the U.S. Bank Tower in Los Angeles, displayed credit characteristics consistent with a 'BBB-' rated obligation. These credit characteristics have not changed since issuance. The trust balance is $120.1 million (7%) and the whole loan balance is $260 million. The property includes a 71-story 1.37 million-sq.- ft. class A office tower and a six-story parking garage. Year-end 2005 DSC was 2.64x and occupancy was 89%. Wachovia reported a watchlist of 13 loans with an aggregate outstanding balance of $165.5 million (10%), which includes the sixth-largest loan in the pool and one loan with a balance that exceeds $25 million. The largest loan on the watchlist is High Ridge Park ($56.4 million, 3%), which is secured by six office buildings in Stamford, Connecticut, totaling 498,091 sq. ft. The office buildings were built in 1967 and renovated in 2002. The loan was placed on the watchlist because of a 34% decline in DSC since issuance. The decline in DSC is attributable to a decrease in occupancy after two of the largest tenants occupying 257,000 sq. ft. vacated the property when their leases expired in 2005. The current occupancy is 48% and the year-end 2005 DSC was 1.26x. The property manager is currently in negotiations with one prospective tenant for approximately 120,000 sq. ft. Embry Village Shopping Center ($27.4 million, 2%), the second- largest loan on the watchlist, is secured by a 215,709-sq.-ft. retail center in Atlanta, Georgia, that was built in 1960 and renovated in 2002. The loan was placed on the watchlist due to a decline in DSC caused by increased expenses. Despite the property's 94% occupancy rate, year-end 2005 DSC was 1.0x. The Belle Meadow Apartments is the only asset with the special servicer and has an unpaid principal balance of $6.1 million. This loan is secured by a 160-unit multifamily apartment building in Trotwood, Ohio, that was built in 1989. This loan was transferred to the special servicer due to monetary default and a $1.5 million ARA is outstanding. LNR is proceeding with foreclosure. Standard & Poor's stressed various loans in the transaction, paying closer attention to the assets with the special servicer and the loans on the watchlist. The resultant credit enhancement levels support the raised and affirmed ratings. Ratings Raised Greenwich Capital Commercial Funding Corp. Commercial mortgage pass-through certificates series 2003-C2 Rating ------ Class To From Credit enhancement(%) ----- -- ---- --------------------- B AAA AA 15.87 C AAA AA- 14.59 D AA+ A 12.03 E AA A- 11.13 F A+ BBB+ 9.73 G A- BBB 8.19 H BBB+ BBB- 6.65 J BBB BB+ 5.25 K BBB- BB 4.22 L BB BB- 3.58 Ratings Affirmed Greenwich Capital Commercial Funding Corp. Commercial mortgage pass-through certificates series 2003-C2 Class Rating Credit enhancement(%) ----- ------ --------------------- A-1 AAA 18.94 A-2 AAA 18.94 A-3 AAA 18.94 A-4 AAA 18.94 M B+ 2.94 N B 2.30 O B- 1.92 XC AAA N/A XP AAA N/A N/A - Not applicable. GREYSTONE LOGISTICS: Murrell Hall Raises Going Concern Doubt ------------------------------------------------------------ Murrell, Hall, Mcintosh & Co., PLLP, expressed substantial doubt about Greystone Logistics, Inc.'s ability to continue as a going concern after it audited the Company's financial statements for the fiscal years ended May 31, 2006. The auditing firm pointed to the Company's significant losses from operations, lack of adequate funding to maintain working capital and stockholders' deficits at May 31, 2006. The Company incurred a $2.3 million net loss on $15.9 million of net revenues for the fiscal year ended May 31, 2006, compared to a $10.4 million net loss on $9.3 million of net revenues in 2005. At May 31, 2006, the Company's balance sheet showed $9.6 million in total assets and $16.7 million in total liabilities, resulting in a $7.0 million stockholders' deficit. The Company's May 31 balance sheet also showed strained liquidity with $1.4 million in total current assets available to pay $5.8 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?1316 Headquartered in Tulsa, Oklahoma, Greystone Logistics, Inc. (OTCBB: GLGI) through its wholly owned subsidiaries Greystone Manufacturing, LLC, and Plastic Pallet Production, Inc. -- http://www.palweb-plwb.com/-- manufactures and markets plastic pallets. GTM HOLDINGS: S&P Junks Rating on $105 Million 2nd-Lien Term Loan ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Hickory, North Carolina-based sock manufacturer GTM Holdings, Inc. The rating outlook is negative. At the same time, Standard & Poor's assigned its loan and recovery ratings to GTM's proposed secured bank financing, which consist of: * a $50 million first-lien six-year revolving credit facility, * a $225 million first-lien seven-year term loan B, and * a $105 million second-lien 7.5-year term loan. The first-lien facilities are rated 'B' (at the same level as the corporate credit rating on the company) with a recovery rating of '2', indicating the expectation for substantial (80%-100%) recovery of principal in the event of a payment default. The second-lien loan is rated 'CCC+' (two notches lower than the corporate credit rating) with a recovery rating of '5', indicating the expectation for negligible (0%-25%) recovery of principal in the event of a default. These ratings are based on preliminary offering statements and are subject to review upon final documentation. Proceeds from the proposed financing will be used by the equity sponsor, The Blackstone Group, to finance the acquisition of Gold Toe Corp. and Moretz Inc. (including the repayment of existing debt). Upon completion of the acquisition, the two companies will merge to form GTM Holding Inc., and the current rating on Gold Toe will be withdrawn. S&P estimates that GTM will have about $330 million in total debt outstanding upon the closing of the transaction. GTM is a designer, manufacturer, and marketer of men's, women's, and children's socks, selling primarily to mass merchants, and department and national chain store retailers. The combined entity will have a broad portfolio of owned private-label and licensed brands. Brand names include Gold Toe, Silver Toe, PowerSox, New Balance, and Under Armour. Pro forma for the merger, the company's sales will be about $320 million. "The rating on GTM reflects the company's participation in the highly competitive apparel manufacturing industry, its narrow product portfolio, customer concentration, and a highly leveraged financial profile," said Standard & Poor's credit analyst Susan Ding. "These factors are somewhat mitigated by the well-known Gold Toe brand." Standard & Poor's assigns a high degree of business risk to the apparel manufacturing industry (including socks) because of intense competition, low barriers to entry, and the commodity nature of certain items, such as socks. INTERSTATE BAKERIES: Sells Portland Asset to Sierra Construction ---------------------------------------------------------------- On Sept. 11, 2006, Interstate Bakeries Corporation and its debtor- affiliates conducted an auction to sell their interest in the property located at 103 North Ivy Street and 115 North Cook Street, in Portland, Oregon. Sierra Construction Company, Inc., offered a $4,850,000 bid for the Portland property. The Debtors determined that Sierra Construction submitted the best and highest bid, and declared it the Successful Bidder. The Honorable Jerry W. Venters of the U.S. Bankruptcy Court for the Western District of Missouri authorizes the Debtors to sell the Portland Property to Sierra Construction for $4,850,000. The Court permits the Debtors to transfer the Property to Sierra Construction, free and clear of all liens, claims and encumbrances, including, any real or personal property tax lien against the property recorded in Multnomah County, Oregon, with all those valid and enforceable liens, claims and encumbrances to attach to the property's sale proceeds, in the same relative priority as existed with respect to the Property. The Court directs the Debtors to pay $26,847 in principal for real property taxes, and $448 in principal for personal property taxes, for the tax year 2004-2005, plus any interest accrued at the Oregon statutory rate at the Closing. The tax payments will be in full settlement of the Tax Collector's claim against the Property. A full-text copy of the Sierra Construction APA is available for free at http://ResearchArchives.com/t/s?1320 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. 49; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) INTERSTATE BAKERIES: Wants Some Transfers to JPMorgan Avoided ------------------------------------------------------------- Interstate Bakeries Corporation and its debtor-affiliates ask the U.S. Bankruptcy Court for the Western District of Missouri to avoid certain transfers made to JPMorgan Chase Bank, N.A., and other lenders with respect to the Amended and Restated Credit Agreement, dated April 25, 2002, within the 90-day period before they filed for bankruptcy. The Debtors paid the Lenders $249,635,353 from June 24, 2004, through Sept. 15, 2004. Within 90 days before the bankruptcy filing, six of the Debtors also executed certain documents granting alleged security interests and filed certain Uniform Commercial Code-1 financing statements: (1) Interstate Bakeries Corporation, (2) IBC Trucking, LLC, (3) IBC Trucking Corporation, (4) Interstate Brands Corporation, (5) IBC Sales Corporation, and (6) Baker's Inn Quality Baked Goods, LLC. The execution of these documents, according to Paul M. Hoffman, Esq., at Stinson Morrison Hecker, LLP, in Kansas City, Missouri, represents Lien Transfers. Mr. Hoffman adds that certain alleged security interests, mortgages or other liens were also granted to after-acquired property or any collateral proceeds regarding inventory and receivables or the proceeds goods of either. On June 26, 2004, accounts and inventory were valued at $248,762,492. Less than two months later, accounts and inventory increased by $13,873,403, totaling $262,635,895. The Debtors believe that the aggregate of all the Floating Lien Transfers caused a reduction of the estates' value, and prejudiced other creditors holding unsecured claims as of the bankruptcy filing. Mr. Hoffman adds that the security interests granted to JPMorgan and the Lenders exceeded the value of the Debtors' debt. Debtors Were Insolvent The Debtors assert that they were insolvent during the 90-day period before the bankruptcy filing, and thus, want to avoid the Prepetition Transfers. The Debtors further assert that the Prepetition Transfers were made from their properties for or on account of an antecedent debt allegedly owed to JPMorgan and the Lenders. On information and belief, the Prepetition Transfers enabled each of JPMorgan and the Lenders to receive more what they would have received if: -- the Debtors' Chapter 11 case was a Chapter 7 case; -- the Prepetition Transfers had not been made; and -- JPMorgan and the Lenders received payment on the Debt to the extent provided by the provisions of the Bankruptcy Code. Postpetition Transfers Pursuant to the Final DIP Order, the Debtors have also made postpetition periodic transfers based on the premise that JPMorgan and the Lenders have valid, perfected Security Interest Liens or Mortgage Liens. Mr. Hoffman asserts that pursuant to Section 549(a) of the Bankruptcy Code, the Debtors may avoid any transfer that occurs after the bankruptcy filing and that are not authorized by the Bankruptcy Code or the Court. Furthermore, Mr. Hoffman argues, the Debtors are also entitled to avoid the Postpetition Transfers: -- if and to the extent the Court enters an order avoiding the Prepetition Transfers; -- JPMorgan and the Lenders have received any Postpetition Transfers that relate to an avoided lien, and -- the Postpetition Transfers are not otherwise properly credited to an allowed secured claim for the Lenders. JPMorgan Master Claims Mr. Hoffman relates that JPMorgan filed Claim Nos. 5586, 5587, 5590, 5591, 5592 and 5593, on behalf of itself and of the Lenders, against the Debtors. In the Master Claims, JPMorgan asserted that as of the Debtors' bankruptcy filing, the Debtors owe: (a) not less than $476,025,000 in respect of loans made under the Credit Agreement, plus interest and fees and expenses accrued and unpaid as of the Petition Date, and other additional amounts related to the loans; and (b) not less than $172,657,059 in respect of their reimbursement obligations for undrawn letters of credit issued under the Credit Agreement, plus their interest and fees and expenses payable. According to Mr. Hoffman, JPMorgan also asserted that the Prepetition Obligations are secured by security interests, pledges and liens on substantially all of the Debtors' personal property, certain real property and all of their proceeds and products, and all collateral securities and guarantees. JPMorgan also asserted that the Debtors' indebtedness is also secured: (i) pursuant to Sections 506(a) and 553 of the Bankruptcy Code, by the funds on deposit on the bankruptcy filing at JPMorgan or any Lender, which funds were subject to JPMorgan's or that Lender's right of setoff under applicable law, and the Loan Documents; and (ii) by liens granted pursuant to the Final DIP Financing Order. Mr. Hoffman relates that pursuant to Section 502(d), a claim will be disallowed if the claim is of a property that is recoverable or a transfer that is avoidable, unless the transferee has paid the amount, or turned over the property. If the Court determines that JPMorgan and the Lenders received recoverable property or avoidable transfers, then JPMorgan's Claims will be disallowed, Mr. Hoffman asserts. The Debtors also ask the Court to: (a) grant judgment in their favor in an amount equal to the Transfers; (b) direct each of JPMorgan and the Lenders to immediately pay them an amount equal to the Transfers; (c) award them interests from the date of the Transfers until the date of JPMorgan and the Lender's payment; (c) award them costs of the lawsuit; and (d) disallow JPMorgan's six Master Claims. A full-text copy of the JPMorgan Adversary Proceeding is available for free at http://ResearchArchives.com/t/s?131d 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. 49; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) INTERSTATE BAKERIES: Claim Purchasers Form Ad Hoc Committee ----------------------------------------------------------- In connection with the current bankruptcy proceedings of Interstate Bakeries Corporation, an Ad Hoc Committee of Claim Purchasers who hold certain unsecured and reclamation claims against IBC has formed to discuss certain issues of mutual interest. Other claim purchasers and trade creditors who might have an interest in joining the discussions should contact the Ad Hoc Committee's counsel: Evan Flaschen, Esq. Bingham McCutchen LLP Tel: (860) 240-2723. 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. 49; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) JDA SOFTWARE: 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. Technology Software sectors this week, the rating agency confirmed its B2 Corporate Family Rating for JDA Software Group, 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 ---------- ------- ------- ------ ---------- $50 Million Senior Secured Revolving Credit Facility due 2012 B1 B1 LGD3 30% $175 Million Senior Secured First Lien due 2012 B2 B1 LGD3 30% 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- umeric 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 Scottsdale, Arizona, JDA Software Group, Inc., provides software solutions tailored to the retail industry and their suppliers. JEAN COUTU: Takes $120MM Impairment Loss in FY2007 Second Quarter ----------------------------------------------------------------- The Jean Coutu Group Inc. reported a $108.8 million net loss for the first quarter of fiscal 2007, compared with net earnings of $11.1 million for the first quarter of the previous fiscal year. On Aug. 23, 2006, the Company entered into a definitive agreement with Rite Aid Corporation whereby the Company would dispose of its network in the United States. The Company expects to close this transaction in the third quarter of fiscal 2007. However, Generally Accepted Accounting Principles require the Company to recognizes certain components of the disposal transaction immediately. The after-tax impairment loss recognized during the first quarter of fiscal 2007 amounts to $120 million. Total revenues for fiscal 2007 increased by $103.1 million or 3.8% to $2.786 billion, from $2.683 billion for fiscal 2006. Total revenues of the Company's Canadian operations for the first quarter reached $435.5 million compared with $364.7 million for the first quarter of fiscal 2006, an increase of $70.8 million or 19.4%. The Company's US operations generated total revenues of $2.351 billion, up slightly from the first quarter of fiscal 2006, due principally to improving pharmacy sales, net of the closure of 78 non-performing Eckerd drugstores, which had contributed $21.2 million to revenues during the first quarter of fiscal 2006. The Company's Board of Directors declared a quarterly dividend of CDN$ 0.03 per share. This dividend is payable on Nov. 9, 2006, to all holders of Class A subordinate voting shares and holders of Class B shares listed in the Company's shareholder ledger as of October 26, 2006. Outlook With the announcement of the Rite Aid-Jean Coutu Group transaction, the Company will be well positioned to capitalize on the growth in the North American drugstore retailing industry. Demographic trends in Canada and the United States are expected to contribute to growth in the consumption of prescription drugs, and to the increased use of pharmaceuticals as the primary intervention in individual healthcare. Management believes that these trends will continue and that the Company will achieve sales growth through differentiation and quality of offering and service levels in its drugstore network. The Company operates its Canadian and US networks with a focus on sales growth, its real estate program and operating efficiency. The initial budget for the 2007 fiscal year called for capital expenditures of approximately $300 million, representing $250 million in the United States and $50 million in Canada. Management expects that the announced transaction with Rite Aid, which is expected to close in the third quarter of fiscal 2007, will help create shareholder value. The Jean Coutu Group will optimize its US presence by transforming its investment in a regional drugstore chain into the leading ownership position of a major national chain with enhanced scale to better compete in the US drugstore industry. The Company's' 32.0% equity ownership position in the expanded Rite Aid will allow shareholders to participate in the economic benefits of expected synergies. The cash proceeds from the transaction will be used to retire debt, enhancing financial flexibility. About Jean Coutu Headquartered in Longueuil, Quebec, The Jean Coutu Group Inc. (TSX: PJC.A) -- http://www.jeancoutu.com/-- has a combined network of 2,175 corporate and franchised drugstores (under the banners of Brooks and Eckerd Pharmacy, PJC Jean Coutu, PJC Clinique and PJC Sante Beaute) in North America. The Group's United States operations employ 46,000 people and comprise 1,853 corporate owned stores located in 18 states of the Northeastern, mid-Atlantic and Southeastern United States. The Group's Canadian operations and franchised drugstores in its network employ over 14,000 people and comprise 322 PJC Jean Coutu franchised stores in Quebec, New Brunswick and Ontario. * * * As reported in the Troubled Company Reporter on Aug. 25, 2006, Standard & Poor's Ratings Services placed its ratings, including the 'B+' long-term corporate credit rating, on Montreal, Quebec- based Jean Coutu Group Inc. on CreditWatch with positive implications. At the same time, the ratings on PJC's $850 8.5% million senior subordinated notes were placed on CreditWatch with developing implications. As reported in the Troubled Company Reporter on Aug. 29, 2006, Dominion Bond Rating Service placed the ratings of Jean Coutu Group Inc., under review with developing implications following the announcement that the Company has entered into an agreement to sell its Eckerd and Brooks stores to Rite Aid for cash and stock. Facilities placed on review include Bank Credit Facilities (Developing B (high)), Senior Unsecured Debt (Developing B) and Senior Subordinated Debt (Developing B (low)). The current ratings are B (high) for the Bank Credit Facilities, B for the Senior Unsecured Debt and B (low) for the Senior Subordinated Debt. KARA HOMES: Case Summary & 172 Largest Unsecured Creditors ---------------------------------------------------------- Lead Debtor: Kara Homes, Inc. 197 Route 18 South, Suite 235S East Brunswick, NJ 08816 Bankruptcy Case No.: 06-19626 Debtor-affiliates that filed separate chapter 11 petitions on Oct. 9, 2006: Entity Case No. ------ -------- Kara at Navasink, LLC 06-19737 Kara at Lacey, LLC 06-19738 The Landings at Manahawkin, LLC 06-19740 Kara at the Tradewinds, LLC 06-19741 Kara at Buckley Estates, LLC 06-19742 Kara at Dayna Court, LLC 06-19743 Country Club Estates by Kara, LLC 06-19744 Horizons at Woodlake Greens, LLC 06-19745 Estates at Galloway Woods, LLC 06-19746 Type of Business: The Debtor builds single-family homes, condominiums, townhomes, and active-adult communities. Chapter 11 Petition Date: October 5, 2006 Court: District of New Jersey (Trenton) Judge: Raymond T. Lyons Jr. Debtor's Counsel: David L. Bruck, Esq. Greenbaum, Rowe, Smith, et al. P.O. Box 5600 Woodbridge, NJ 07095 Tel: (732) 549-5600 Fax: (732) 549-1881 Financial condition of Kara Homes: Total Assets: $350,179,841 Total Debts: $296,840,591 Financial condition of the debtor-affiliates that filed on October 9, 2006: Entity Total Assets Total Debts ------ ------------ ----------- Kara at Navasink, LLC $15,608,000 $8,270,761 Kara at Lacey, LLC $2,732,000 $2,565,849 The Landings at Manahawkin, LLC $36,778,000 $26,302,756 Kara at the Tradewinds, LLC $9,507,000 $4,882,618 Kara at Buckley Estates, LLC $10,447,000 $5,222,916 Kara at Dayna Court, LLC $2,313,608 $2,119,712 Country Club Estates by Kara, LLC $3,068,000 $1,813,015 Horizons at Woodlake Greens, LLC $18,924,000 $11,508,550 Estates at Galloway Woods, LLC $6,175,000 $4,375,933 A. Kara Homes, Inc.'s 20 Largest Unsecured Creditors: Entity Claim Amount ------- ------------ A-1 Bracket $1,856,462 145 W. Philadelphia Avenue Morrisville, PA 19067 Strober Building Supply, Inc. $1,541,663 81 Kresson Road Haddonfield, NJ 08033 Sunrise Concrete Company, Inc. $1,257,344 P.O. Box 435 Rushland, PA 18956 RWZ Inc. Stairs & Rails $890,655 520 James Street Lakewood, NJ 08701 Benchmark Inc. $876,586 450 Oberlin Avenue South Lakewood, NJ 08701 Michael J. Wright $780,310 Construction Co., Inc. 16 Madison Avenue Toms River, NJ 08753 R&R Construction Co., Inc. $777,950 105-B Parker Road Chester, NJ 07930 Home Remodeling Concepts $703,074 4 Dale Drive Fairfield, NJ 07004 Manzo-Maroba Construction $686,101 Beacon Hill Place Morganville, NJ 07751 Woodhaven Lumber & Millwork $634,569 P.O. Box 870 Lakewood, NJ 08701 SJP Contractors $634,056 7 Industrial Drive Keyport, NJ 07735 C&R Plumbing & Heating $604,342 822 Route 9 Lanoka Harbor, NJ 08734 All County Aluminum Inc. $575,397 560 Cross Street Lakewood, NJ 08701 East Lake Interiors LLC $554,873 215 Edgewood Avenue West Berlin, NJ 08091 Strober Building Supply, Inc. $524,036 81 Kresson Road Haddonfield, NJ 08033 Concrete Systems $519,478 45 Lupine Way Stirling, NJ 07980 Wagner Electric Corp. $501,001 449 Washington Road Sayreville, NJ 08872 Leopard Framing Corp. $499,898 P.O. Box 146 Nutley, NJ 07110 Century Kitchens, Inc. $458,404 Route 309 & RR Crossing Colmar, PA 18915 Shoreline Plumbing & Heating $444,103 447 Stage Road Tuckerton, NJ 08087 B. Kara at Navasink, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Borreo, Jason Deposit $119,040 [Address not included] Cerchio, Dominick Deposit $114,335 [Address not included] Covas, Al Deposit $75,490 10 Nolan Court Atlantic Highlands, NJ 07716 Lamb Deposit $75,490 521 Harding Road Fair Haven, NJ 07704 Spaltro, Nick Deposit $69,990 34 Maria Court Holmdel, NJ 07733 Morrison, Tom and Allison Deposit $54,900 419 Adams Street #2B Hoboken, NJ 07030 Township of Middletown $41,604 1 Kings Highway Middletown, NJ 07748 Live Oak Landscaping $40,519 Contractors Reres, Robert Deposit $36,148 1921 J Greve Avenue Spring Lake, NJ 07762 Salgado, Paul Deposit $35,751 248 Crann Street Hillside, NJ 07205 Grant, Howard and Jane Deposit $30,495 160 Ocean Avenue Atlantic Highlands, NJ 07716 Seide, Harold and Susan Deposit $30,000 72 Bellevue Avenue Rumson, NJ 07760 Freeman, Douglas Deposit $29,990 58 Preston Street Edison, NJ 08817 Marlboro Lawn Inc. $19,495 P.O. Box 122 Marlboro, NJ 07746 Sunrise Concrete Company $10,197 P.O. Box 435 Rushland, PA 18956 Caruso Excavating Co. $8,808 P.O. Box 2043 Asbury Park, NJ 07712 Michael J. Wright $7,825 Construction Co., Inc. 16 Madison Avenue Toms River, NJ 08753 April Showers Sprinklers $7,040 2 Lakeview Avenue Piscataway, NJ 08854 Blue Line Drywall & $6,550 Insulation 500 Highway 33 Englishtown, NJ 07726 John S. Truhan Consulting $5,997 Engineers P.O. Box K Manasquan, NJ 08736 C. Kara at Lacey, LLC's 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ New Jersey Natural Gas $196,921 1415 Wyckoff Road Belmar, NJ 07719 Mathis Construction $159,142 1510 Route 539 Tuckerton, NJ 08087 Capra, Robert and Annette Deposit $87,890 8 Carolyn Road Belleville, NJ 07109 Carson, Jill Deposit $62,610 2802 Jockey Hollow Drive Toms River, NJ 08755 Landscape Maintenance $45,000 Services 119 Wall Street Princeton, NJ 08540 Sunrise Concrete Company $29,819 P.O. Box 435 Rushland, PA 18956 Spagnola, John and DaSilva, Deposit $25,252 Cidalia 194 Corbin Court Lakewood, NJ 08701 Michael J. Wright $20,779 Construction Co., Inc. 16 Madison Avenue Toms River, NJ 08753 Property Dev. Services II, $13,002 Inc. 700 Hooper Avenue Toms River, NJ 08753 Strober Building Supply, $12,754 Inc. 81 Kresson Road Haddonfield, NJ 08033 Atlantic City Electric Co. $12,738 P.O. Box 4875 Trenton, NJ 08650 Androcy, Evan and Smith, Deposit $11,000 Kim 2205 Sweetwood Drive Forked River, NJ Atlantic Fence Co. $8,685 P.O. Box 623 Tuckerton, NJ 08087 Township of Lacey $4,826 818 West Lacey Road Forked River, NJ 08731 Kline Construction $2,145 240 Waveland Avenue Absecon, NJ 08201 Woodhaven Lumber & $1,786 Millwork P.O. Box 870 Lakewood, NJ 08701 Advanced Site and Utility $1,750 Contr. 1201 Wilkinson Drive Toms River, NJ 08755 East Coast Site Work $1,574 6 Dickens Court Howell, NJ 07731 Johnny on the Spot $175 3168 Bordentown Road Old Bridge, NJ 08857 D. The Landings at Manahawkin, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Kaye, Leonard and Margaretia Deposit $78,863 72 Middlehill Road Colonia, NJ 07067 Township of Stafford $75,077 260 East Bay Avenue Manahawkin, NJ 08050 Scher, Marc and Michele Deposit $68,497 24 Pawnee Raod East Brunswick, NJ 08816 Pacelli, Anthony Deposit $67,343 224 Terrace Lake Drive Butler, NJ 07405 Thoman, Kenneth and Suzanne Deposit $63,123 14 Lowell Court Brick, NJ 08724 Nelligar, Steven and Denise Deposit $57,844 3800 Waldo Avenue Bronx, NY 10463 McGann, Brian Deposit $57,744 2 Jones St. Apt. 5 Jersey City, NJ 07306 Bagoff, Robert DMD Deposit $57,730 77 Clarken Drive West Orange, NJ 07052 Rebeck, Richard and Arlene Deposit $56,771 366 Alden Way North Brunswick, NJ 08902 Wetzel, Lance and Susan Deposit $55,519 31 Southwycke Lane Warwick, NY 10990 LaMastro, Eugene Deposit $55,344 2 Mountainside Drive Randolph, NJ 078692217 Madia, June and Frank Deposit $55,197 11 Windsor Road Morris Plains, NJ 07950 Hymanson, Helen Deposit $54,967 185 Prospect Avenue, Apt. 12G Hackensack, NJ 07601 Gattie, Marie and Frantz, Deposit $54,748 Jennifer 62 Ludlow Road Parsippany, NJ 07054 Poultney, Robert and Carolyn Deposit $52,789 3 Red Hill Road Warren, NJ 07059 Freeman, Kevin Deposit $52,072 23 Wimblet Court Edison, NJ 08817 Thomas/Pejkovic, Michael Deposit $51,188 2253 Ridge Street Yorktown Heights, NY 10598 Weiss, Michael and David Deposit $51,142 22 Shady Stream Road Barnegat, NJ 08005 Forcier, Vickie Deposit $50,471 147 Hankins Road Hightstown, NJ 08520 Lucarello, Arlene and Pat Deposit $49,818 332 Moonlight Drive Piscataway, NJ 08854 E. Kara at the Tradewinds, LLC's 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hirsch, Kevin and Linda Deposit $210,000 700 Monteray Boulevard NE Saint Petersburg, FL 33704 Township of Sea Bright $10,539 1167 Ocean Avenue Rumson, NJ 07760 Sunrise Concrete Company $2,600 P.O. Box 435 Rushland, PA 18956 Lynch Guilano & Associates $1,625 Terrace Professional Bldg. Brick, NJ 08723 Michael J. Wright $1,086 Construction Co., Inc. 16 Madison Avenue Toms River, NJ 08753 GE Cap Modular Space $445 530 East Swedesford Wayne, PA 19087 Bailey Square Janitorial $350 Inc. 16 South Street Freehold, NJ 07728 Vintage $339 811 Sixteenth Avenue Belmar, NJ 07719 BP Associates $334 52A Highway 79 Marlboro, NJ 07746 Willis Construction Services $300 25B Vreeland Road Florham Park, NJ 07932 Tradewinds Homeowners Unknown Association Attn: Midlantic Property Management 315 Raritan Avenue Highland Park, NJ 08904 F. Kara at Buckley Estates, LLC's 10 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Goyal, Janak and Manju Deposit $205,671 8 Disbrow Road Matawan, NJ 07747 Nagarsheth, Harish and Deposit $187,035 Veena 10 Plowshare Court Marlboro, NJ 07746 Bhatia, Rajiv and Amita Deposit $150,665 26 Buttonwood Drive Marlboro, NJ 07746 Martin, Harold J. and Deposit $127,390 Premise D. 42 Witherspoon Way Marlboro, NJ 07746 Ahmad, Aziz Deposit $124,993 35 Matthew Place Staten Island, NY 10305 Township of Marlboro $22,605 1979 Township Drive Marlboro, NJ 07746 Hanson Engineering Inc. $1,250 7 Doig Road Wayne, NJ 07470 Imagistics $260 7555 E. Hampden Avenue Denver, CO 80231 Wanaque Water Dept. $32 P.O. Box 47 Wanaque, NJ 07465 Culligan $14 305 Clearview Road Edison, NJ 08837 G. Kara at Dayna Court, LLC's 14 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Fried, Jerold and Tammy Deposit $134,382 28 Pacific Avenue Bayville, NJ 08721 Vu, Tram Anh Deposit $110,000 718 Spruce Hill Drive Toms River, NJ 08753 Leopoidevin, Jeff and Losito Deposit $91,090 Frank 1 Shorin Way Manchester Township, NJ 08759 Mazzei, Rocco Deposit $37,500 115 Mesa Verde Lane Howell, NJ Verizon $22,800 P.O. Box 4833 Trenton, NJ 08650 ManzoMaroba Construction $18,000 Beacon Hill Place Morganville, NJ 07751 Jillette Advertising Inc. $15,899 746 Highway 34 Matawan, NJ 07747 Control Layouts, Inc. $6,099 271 Cleveland Avenue Highland Park, NJ 08904 Menlo Engineering Assoc Inc. $4,489 261 Cleveland Avenue Highland Park, NJ 08904 Meridan Engineering Group $4,487 Inc. 33 Wood Avenue South Iselin, NJ 08830 Township of Dover $4,020 P.O. Box 48044 Newark, NJ 07101 Art Associates Design Group $424 Matawan, NJ 07747 Difrancesco, Bateman, Coley $387 15 Mountain Blvd Warren, NJ 07059 Magrann Associates Corp. $135 240 West Route 38 Moorestown, NJ 08057 H. Country Club Estates by Kara, LLC's 18 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wolfrom, Jeffrey and Lynn Deposit $142,546 319 Aster Circle Kennett Square, PA 19348 Caufield, Richard and Judith Deposit $101,225 197 Maple Street Roselle Park, NJ 07204 Township of Little Egg $18,923 Harbor 665 Radio Road Tuckerton, NJ 08087 Guardian Protection Services $13,705 204 Diplomat Drive Philadelphia, PA 19113 Township of Little Egg $11,118 Harbor 665 Radio Road Tuckerton, NJ 08087 Vintage $3,369 811 Sixteenth Avenue Belmar, NJ 07719 All County Aluminum $1,350 560 Cross Street Lakewood, NJ 08701 Brennan Contracting $930 349 Appletree Drive Levittown, PA 19055 Sunrise Concrete Company $560 P.O. Box 435 Rushland, PA 18956 Willis Construction Services $554 25 B Vreeland Road Florham Park, NJ 07932 Zahn Transportation $552 P.O. Box 158 Manchester Township, NJ 08759 Adams Rehmann & Heggan $540 850 South White Horse Pike Hammonton, NJ 08037 Greenscape Landscaping $350 727 Cornwallis Drive Mount Laurel, NJ 08054 Top Coat Paving Inc. $340 P.O. Box 7 Lanoka Harbor, NJ 08734 Bailey Square Janitorial Inc. $340 16 South Street Freehold, NJ 07728 Michael J. Wright $310 Construction Co. 16 Madison Avenue Toms River, NJ 08753 Owen, Little & Associates $175 443 Atlantic City Blvd. Beachwood, NJ 08722 Landscape Maintenance $128 Services 119 Main Street Princeton, NJ 08540 I. Horizons at Woodlake Greens, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Township of Lakewood $99,651 231 Third Street Lakewood, NJ 08701 Mueller, Constance Deposit $86,043 608 Oceanview Road Brielle, NJ 08730 Smallwood, John and Mary Deposit $75,285 Ann 13326 Ocean Avenue Rumson, NJ 07760 Dennery, John and Elsa Deposit $73,212 10 Wood Drive Morris Plains, NJ 07950 HindsSamuels, Patricia Deposit $67,797 172-32 133rd Avenue Apt. 10G Jamaica, NY 11434 Straniero, Salvatore J. and Deposit $65,523 Amelia 397 Middle Road Hazlet, NJ 07730 Leonard, John M and Mary C. Deposit $61,089 148 Dorset Drive Clark, NJ 07066 Kalamaras, Rosemary and Deposit $59,402 Louis 5 Dryden Road Brick, NJ 08724 Balducci, Carol Deposit $55,535 15 Bunker Hill Drive Old Bridge, NJ 08857 Rienzo, Elizabeth A. Deposit $53,467 144 N. Hampton Drive Leonardo, NJ 07737 Giannetti, Patrick A. and Deposit $52,540 Gayle T. 4 Ellison Avenue Edison, NJ 08820 Yetto, Marianne Deposit $49,460 1420 Bay Ridge Parkway Brooklyn, NY 11228 DeGrusso, Ross and Jean Deposit $49,200 360 Colon Avenue Staten Island, NY 10308 Albietz, Paul J. and Deposit $49,178 Elaine M. 2231 Franklin Drive Belmar, NJ 07719 Greco, Paolino and Elena Deposit $47,038 1805 Meadow Road Belmar, NJ 07719 Hensler, George and Hilma Deposit $35,245 26 Lenox Avenue Cranford, NJ 07016 Craggen, Janet Deposit $32,407 35 Lafayette Drive Hazlet, NJ 07730 Hira, Gurvir and Daljeet Deposit $31,976 21 Surrey Drive Old Bridge, NJ 08857 Bercovicz, Israel and Sarah Deposit $21,282 10 Lambert Johnson Drive Asbury Park, NJ 07712 Lindstrom, Diessner & $1,216 Carr PC 136 Drum Point Road, Suite 6 Brick, NJ 08723 J. Estates at Galloway Woods, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Strober Building Supply $103,382 Truss 81 Kresson Road Haddonfield, NJ 08033 Russo, Robert and Kelly Deposit $96,657 10 Seminde Street Monroe Township, NJ 08831 Dechavez, Maria Deposit $80,388 94 Tennyson Street Carteret, NJ 07008 Chandler, Stephen and Jen Deposit $39,528 1079 Bally Bunion Drive Egg Harbor City, NJ 08215 Menser's Heating & Air $33,593 800 Park Avenue Lakewood, NJ 08701 Alfano, Phyllis and Durden, Deposit $30,347 Gerald 2348 Linwood Avenue2P Fort Lee, NJ 07024 RWZ Stairs and Rails $24,580 520 James Street Lakewood, NJ 08701 Property Dev. Services, Inc. $14,192 700 Hooper Avenue Toms River, NJ 08753 Sunrise Concrete Company $13,012 P.O. Box 435 Rushland, PA 18956 Waters and Bugbee Inc. $10,091 75 South Gold Drive Trenton, NJ 08691 Strober Building Supply Inc. $8,300 81 Kresson Road Haddonfield, NJ 08033 East Coast Site Work $8,084 6 Dickens Court Howell, NJ 07731 Shoreline Plumbing & $6,259 Heating 447 Stage Road Tuckerton, NJ 08087 Township of Galloway $5,187 300 East Jimmie Leeds Road Absecon, NJ 08205 Michael J. Wright $4,795 Construction Co. 16 Madison Avenue Toms River, NJ 08753 Johnny on the Spot Inc. $1,575 3168 Bordentown Road Old Bridge, NJ 08857 Builders First Source $1,464 20 South Middlesex Avenue Monroe Township, NJ 08831 Advanced Site and Utility $1,400 Contr. 1201 Wilkinson Drive Toms River, NJ 08755 Manzo-Maroba Construction $1,251 Beacon Hill Place Morganville, NJ 07751 Johannessen & Leone $749 Associates Lansdale, PA 19446 KARA HOMES: Magyar Bank Clarifies $5.135 Million Security Loan -------------------------------------------------------------- Magyar Bank, the principal subsidiary of Magyar Bancorp, is releasing a statement to clarify information regarding loans made by the Bank to East Brunswick builder Kara Homes Inc., which recently filed for Chapter 11 bankruptcy. Kara Homes' lending relationship with the Bank consists of four construction loans with total outstanding balances of $7,575,000. Two of the four loans were participated with other banks, limiting Magyar's total lending relationship with Kara Homes to $5,135,000. These loans were originated within the Bank's guidelines, including the requirement that the maximum loan-to-value ratio is 75% of the appraised value of the property. The Bank is in a first lien position with respect to the Real Estate securing the loans. Details of the four loans are: * The Bank holds a Construction Mortgage Loan to Hartley Estates by Kara, LLC, a company principally owned by Zuhdi Karagjozi, President of Kara Homes. The purpose of this loan is acquisition and development of approved residential building lots located in Little Egg Harbor Township, New Jersey. The total mortgage loan is $4,085,000 and the outstanding principal balance is $1,214,000. This loan is collateralized by improved and/or approved real estate located in Little Egg Harbor Township, New Jersey. * The Bank holds a Construction Mortgage Loan to Kara at Dayna Court, LLC, a company principally owned by Zuhdi Karagjozi, President of Kara Homes. The purpose of this loan is acquisition and development of approved residential building lots located in Dover Township, Ocean County, New Jersey. The total mortgage loan is $2,946,000 and the outstanding principal balance is $1,480,000. This loan is collateralized by improved and/or approved real estate located in Dover Township, Ocean County, New Jersey. * The Bank holds a Construction Mortgage Loan to Kara at Park Ridge Estates, LLC, a company principally owned by Zuhdi Karagjozi, President of Kara Homes. The purpose of this loan is acquisition and development of approved residential building lots located in Manahawkin, Stafford Township, New Jersey. The total mortgage loan is $5,283,000. This is a participation loan, and the outstanding principal balance of the Bank's participation interest in this loan is $1,359,000. This loan is collateralized by improved and/or approved real estate located in Manahawkin, Stafford Township, New Jersey. * In addition, the Bank holds a Construction Mortgage Loan to Sterling Acres at Monroe, LLC, a company principally owned by Zuhdi Karagjozi, President of Kara Homes. The purpose of this loan is acquisition and development of approved residential building lots located in Monroe Township, New Jersey. The total mortgage loan is $2,752,000. This is a participation loan, and the outstanding principal balance of the Bank's participation interest in this loan is $1,082,000. This loan is collateralized by improved and/or approved real estate located in Monroe Township, New Jersey. Although the Bank believes that it will receive full payment on these loans, there can be no assurance that losses will not be incurred or that significant additional expenses will not be incurred in the process of the resolution of the Kara Homes situation. About Magyar Based in New Brunswick, New Jersey, Magyar Bancorp (Nasdaq: MGYR) -- http://www.magbank.com/-- is the parent company of Magyar Bank, a $410 million asset community bank. Magyar Bank has been serving families and businesses in Central New Jersey for over 80 years with a complete line of financial products and services, and today Magyar operates branch locations in New Brunswick, North Brunswick, South Brunswick and Branchburg. About Kara Homes Headquartered in East Brunswick, New Jersey, Kara Homes, Inc. builds single-family homes, condominiums, townhomes, and active- adult communities. The Company filed for Chapter 11 protection on Oct. 5, 2006 (Bankr. D. N.J. Case No. 06-19626). David L. Bruck, Esq., at Greenbaum, Rowe, Smith, et al., represents the Debtor. When the Debtor filed for protection from its creditors, it listed total assets of $350,179,841 and total debts of $296,840,591. KERR-MCGEE CORP: Moody's Lifts Ratings on Notes and Debentures -------------------------------------------------------------- Moody's Investors Service upgraded five series of notes and debentures issued by Kerr-McGee Corporation to Baa2 from Ba2, following the provision of an unconditional guarantee of those securities by Anadarko Petroleum Corporation. The unconditional parent guarantee was effected through amendments to the indentures governing the securities, and Kerr-McGee, as a wholly-owned and guaranteed subsidiary of Anadarko, will no longer file or provide audited financial statements. Moody's notes that the indentures contain provisions for the possible removal of the parent guarantee in the event that Kerr-McGee were required to resume filing separate financial statements in the future. Moody's views that as an unlikely scenario, but would expect to review the Kerr-McGee securities for downgrade if the parent guarantee were removed. Anadarko's negative rating outlook reflects the high level of debt incurred when it acquired Kerr-McGee in August 2006, and a view that post-acquisition leverage could remain elevated even after the company proceeds with its de-leveraging strategy. Over the next year, Moody's will monitor Anadarko's progress on the de- leveraging plan, as well as the free cash generation and reserve replacement coming out of the acquisition, to see clear indications that financial leverage is moving to a sustainable lower level. Anadarko Petroleum Corporation is headquartered in The Woodlands, Texas. LAKESIDE HEIGHTS: Case Summary & 19 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Lakeside Heights Nursing Center, LLC fdba Highland Heights Nursing & Rehabilitation Center P.O. Box 3379 Riverview, FL 33569 Bankruptcy Case No.: 06-05492 Type of Business: The Debtor operates a medical, nursing, and rehabilitation center. Chapter 11 Petition Date: October 10, 2006 Court: Middle District of Florida (Tampa) Judge: K. Rodney May Debtor's Counsel: Richard J. McIntyre, Esq. Trenam, Kemker, Scharf P.O. Box 1102 Tampa, FL 33601-1102 Tel: (813) 223-7474 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 19 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ HCFP-Lakeside, LLC $3,200,000 4445 Willard Avenue, 12th Floor Chevy Chase, MD 20815 LN Collections, LLC $450,000 4445 Willard Avenue, 12th Floor Chevy Chase, MD 20815 Doris Abisellan $227,000 15017 Eagle Rise Drive Lithia, FL 33547 Endurcare $202,517 311 Spangler Drive, Suite K Richmond, KY 40475 Hone Care Pharmacy $110,517 P.O. Box 631285 Cincinnati, OH 45263-1285 Grace Senior Services, LLC $110,000 Leaderstat $87,140 U.S. Foodservice $79,241 Skilled Care Pharmacy $76,765 Gulf South Medical $55,479 Cinergy-Main $42,154 Bella Healthcare $32,000 Accuro Specialty Bed Solutions $30,300 Preferred Medical Co. $26,167 Doris Abisellan $25,000 Sanitation District $21,440 Skin Care Management $14,267 Pennington International $12,799 Omnicare-Respiratory $11,531 LB-UBS COMMERCIAL: S&P Holds Low-B Ratings on Six Certificates -------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on nine classes of commercial mortgage pass-through certificates from LB- UBS Commercial Mortgage Trust 2003-C7. Concurrently, ratings are affirmed on 13 other classes from the same series. The raised and affirmed ratings reflect credit enhancement levels that provide adequate support through various stress scenarios. The upgrades of several senior certificates reflect the defeasance of $297.6 million (21%) in collateral since issuance. As of the Sept. 15, 2006, remittance report, the collateral pool consisted of 67 loans with an aggregate trust balance of $1.415 billion, down from 68 loans with a $1.447 billion balance at issuance. The master servicer, Wachovia Bank N.A., reported primarily full-year 2005 financial information for 97% of the pool. Based on this information, Standard & Poor's calculated a weighted average debt service coverage (DSC) of 2.04x, up from 1.98x at issuance. The current DSC figure excludes the loans for the defeased collateral. All of the loans in the pool are current. To date, the trust has not experienced any losses. The top 10 loans secured by real estate have an aggregate outstanding balance of $733.4 million (52%) and a weighted average DSC of 2.30x, compared with 2.17x at issuance. Credit characteristics for five of the top 10 loans in the pool have been stable since issuance. Standard & Poor's reviewed property inspections provided by the master servicer for all of the assets underlying the top 10 loans. One property was characterized as "excellent," while the remaining collateral was characterized as "good." The largest exposure in the pool, the Bank of America Building loan, has a trust balance of $206.7 million (15%) and a raked balance of $5.8 million. The loan is secured by a 1.1 million- sq.-ft. office property in Manhattan, N.Y. The property is adjacent to Grand Central Station and is 100% occupied. Standard & Poor's adjusted DSC is 2.37x and the adjusted loan-to-value ratio (LTV) is 61%. The second-largest exposure, Valley Plaza Shopping Center, has a trust balance of $100.9 million (7%). The loan is secured by 522,181 million sq. ft. of a 1.15 million-sq.-ft. regional mall in Bakersfield, California. The sponsor of the loan and manager of the property is General Growth Properties Inc. (BBB-/Negative/--). Standard & Poor's adjusted NCF is 7% above its level at issuance. The third-largest exposure, the Parklawn Building loan, has a trust balance of $100.0 million (7%) and is secured by a 1.38- million-sq.-ft. office property in Rockville, Maryland. The property was built-to-suit for the General Services Administration (GSA) in 1969. GSA's lease extends until July 2010. Standard & Poor's adjusted NCF is 1% below its level at issuance. The fourth-largest exposure, Westfield Shoppingtown Santa Anita, has a whole-loan balance of $129.7 million and a trust balance of $72.4 million (5%). The loan is secured by 387,693 million sq. ft. of a 1.1 million-sq.-ft. regional mall in Arcadia, California. The sponsor of the loan and manager of the property is Westfield America Trust (A-/Stable/A-2). Standard & Poor's adjusted LTV is 28%. The sixth-largest exposure, Visalia Mall, has a trust balance of $45.1 million (3%). The loan is secured by a 439,833 million-sq.- ft. regional mall in Visalia, California. The sponsor of the loan and manager of the property is General Growth Properties Inc. Standard & Poor's adjusted NCF is 3% above its level at issuance. Wachovia reported a watchlist of 13 loans ($135.6 million, 10%). The Chimney Rock Apartments loan is the 10th-largest exposure ($34.4 million, 2%) and is secured by a 970-unit multifamily property in Houston, Texas. The loan appears on the watchlist because the property reported a year-end 2005 DSC of 0.67x. An increase in operating expenses and the end of the loan's interest- only period caused the low DSC. 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 LB-UBS Commercial Mortgage Trust 2003-C7 Commercial mortgage pass-through certificates series 2003-C7 Rating ------ Class To From Credit enhancement(%) ----- -- ---- --------------------- B AAA AA+ 14.06 C AAA AA 12.51 D AAA AA- 11.34 E AA+ A+ 10.18 F AA A 9.27 G AA- A- 7.59 H A BBB+ 6.04 J BBB+ BBB 5.00 K BBB BBB- 3.97 Ratings Affirmed LB-UBS Commercial Mortgage Trust 2003-C7 Commercial mortgage pass-through certificates series 2003-C7 Class Rating Credit enhancement(%) ----- ------ --------------------- A-1 AAA 15.35 A-2 AAA 15.35 A-3 AAA 15.35 A-4 AAA 15.35 A-1B AAA 15.35 L BB+ 3.06 M BB 2.54 N BB- 2.29 P B+ 2.03 Q B 1.77 S B- 1.51 X-CL AAA N/A X-CP AAA N/A N/A - Not applicable. LONDON FOG: Pays $400,00 Break Up Fee to LF Joint Venture --------------------------------------------------------- The Honorable Gregg W. Zive of the U.S. Bankruptcy Court for the District of Nevada has authorized London Fog Group, Inc., and its debtor-affiliates to pay $400,000 to LF Joint Venture LLC as a "breakup fee" for its participation in the auction of the Debtors' London Fog brand name. LF Joint Venture had tendered an $18.1 million bid for the assets. As reported in the Troubled Company Reporter on Aug. 30, 2006, Iconix Brand Group, Inc., closed the acquisition of the London Fog brand from the Debtor. As reported in the Troubled Company Reporter on Aug. 23, 2006, the purchase price for the transaction was $30.5 million in cash and $7 million in the Company's stock. The cash portion of the acquisition will be primarily funded through an increase of the Company's asset backed note, which is secured by certain of the Company's intellectual property. The Debtors told the Court that LF Joint Venture is entitled to the break up fee because its efforts increased the likelihood of a robust and fulsome auction process, and helped the Debtors maximize value for their assets. About London Fog Headquartered in Seattle, Washington, London Fog Group, Inc. -- http://londonfog.com/-- nka PTI Holding Corp. designs and retails the latest styles in jackets and other professional apparel. The company and six of its affiliates filed for chapter 11 protection on March 20, 2006 (Bankr. D. Nev. Case No. 06- 50146). Stephen R. Harris, Esq., at Belding, Harris & Petroni, Ltd., represents the Debtors in their restructuring efforts. Avalon Group, Ltd., serves as the Debtors' financial advisor. Aron M. Oliner, Esq., at Buchalter Nemer, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they estimated assets and debts between $50 million to $100 million. MADE2MANAGE SYSTEMS: 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. Technology Software sectors this week, the rating agency confirmed its B3 Corporate Family Rating for Made2Manage Systems 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 ---------- ------- ------- ------ ---------- $15 Million Senior Secured Revolving Credit Facility B2 B1 LGD2 28% $100 Million Senior Secured First Lien B2 B1 LGD2 28% $65 Million Senior Secured Second Lien Caa1 Caa2 LGD5 81% 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- umeric 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, Made2Manage Systems Inc. provides enterprise software systems designed for small to medium sized manufacturing businesses. MAGMA CDO: Moody's Lifts $14.5 Million Sub. Notes' Rating to B3 --------------------------------------------------------------- Moody's Investors Service downgraded these notes issued by Magma CDO Ltd.: * $4,000,000 Class B-1 Subordinate Fixed Rate Notes Due 2012 Prior Rating: Baa2 Current Rating: Baa3 * $20,000,000 Class B-2 Subordinate Floating Rate Notes Due 2012 Prior Rating: Baa2 Current Rating: Baa3 * $14,500,000 Class C Second Subordinate Fixed Rate Notes Due 2012 Prior Rating: Ba2 Current Rating: B3 According to Moody's, the rating actions are the results of deterioration in the credit quality of the transaction's underlying collateral pool, as well as the occurrence of asset defaults and par loss. This transaction, which closed in November 2000, was originally managed by JH Whitney & Co. In 2002, Guggenheim Investment Management, LLC replaced JH Whitney as portfolio manager. MARSH SUPERMARKETS: Acquisition Cues Moody's to Withdraw Ratings ---------------------------------------------------------------- Moody's Investors Service withdrew the ratings of Marsh Supermarkets, Inc. following the company's acquisition by an affiliate of the unrated private investment firm Sun Capital Partners, Inc. Now that Marsh is privately owned, financial statements will not be publicly available. Ratings withdrawn: * Corporate Family Rating at B3, under review direction uncertain * Probability of Default rating at Caa1, under review direction uncertain * Senior subordinated notes at Caa2, LGD5, 72%, under review direction uncertain The ratings have been withdrawn because Moody's believes it lacks adequate information to maintain a rating. According to the proxy filed by Marsh on August 18, 2006, the rated senior subordinated debt is to be satisfied and discharged upon the merger. Headquartered Indianapolis, Marsh Supermarkets, Inc., now owned by MSH Supermarkets, Inc., an affiliate of Sun Capital Partners, Inc., operates 116 supermarkets, 154 convenience stores and a catering company. Sales for the fiscal year ended April 1, 2006 exceeded $1.7 billion. MEDICALCV INC: Posts $4 Million Net Loss in First Quarter --------------------------------------------------------- MedicalCV, Inc., incurred a $4,097,562 net loss on zero revenues for the three months ended July 31, 2006, compared to a $5,070,184 net loss on $338,333 of net revenues in 2005, the Company disclosed in its first quarter financial statements on Form-10QSB filed with the Securities and Exchange Commission. As of July 31, 2006, the Company's accumulated deficit widened to $51.4 million from $47.3 million of deficit at July 31, 2005. A full-text copy of the Company's Quarterly Report is available for free at http://researcharchives.com/t/s?1329 Going Concern Doubt Lurie Besikof Lapidus & Company, LLP, expressed substantial doubt about MedicalCV, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the year ending April 30, 2006. The Auditor pointed to the Company's operating losses and negative cash flows from operations and its need for additional funds to finance its working capital and capital expenditure needs. Headquartered in Inver Grove Heights, Minnesota, MedicalCV, Inc. -- http://www.medicalcvinc.com/-- is a cardiothoracic surgery device manufacturer. Previously, its primary focus was on heart valve disease. It developed and marketed mechanical heart valves known as the Omnicarbon 3000 and 4000. In November 2004, after an exhaustive evaluation of the business, MedicalCV decided to explore options for exiting the mechanical valve business. The Company intends to direct its resources to the development and introduction of products targeting treatment of atrial fibrillation. MERIDIAN AUTOMOTIVE: Files Revised Fourth Amended Plan in Delaware ------------------------------------------------------------------ Meridian Automotive Systems, Inc., and its eight debtor-affiliates delivered Oct. 6, 2006, to the U.S. Bankruptcy Court for the District of Delaware a revised Fourth Amended Joint Plan of Reorganization and Disclosure Statement. The Revised Fourth Amended Plan provides for the issuance of New Notes in an aggregate face amount of approximately $98,000,000 on the Effective Date. The Fourth Amended Plan also revises the treatment of Classes 3 and 4 Claims, discusses the determination of the claims that the Prepetition First Lien Lenders and the Prepetition Second Lien Lenders intend to file under Section 507(b) of the Bankruptcy Code, and reflects changes on the Exit Term Loan Credit Facility. In addition, the Plan addresses the issues raised by the Official Committee of Unsecured Creditors in their Disclosure Statement Objection. Treatment of Class 3 Prepetition First Lien Claims Each Holder of an Allowed Prepetition First Lien Claim will, on the Effective Date, receive in full and complete settlement, release and discharge of the Claim: (i) the Lien Avoidance Release; (ii) its Pro Rata share of the New Notes; (iii) 95.5% of the shares of New Common Stock, or 100% of the New Common Stock if Class 4 does not accept the Plan; and (iv) its Pro Rata Share of the Prepetition First Lien Claim Trust Interests, which will entitle the Holder to a share of the net recoveries realized by the Litigation Trust. On the Effective Date, each Prepetition Letter of Credit will be returned to the issuer undrawn and marked canceled and the unpaid reasonable fees and expenses of counsel and the financial advisor to the Prepetition First Lien Agent incurred prior to the Effective Date will be paid be paid within 10 days after the Effective Date subject to the Debtors' prior receipt of invoices and reasonable supporting documentation. The Plan defines "Lien Avoidance Release" as the dismissal, with prejudice, of the Lien Avoidance Action. Treatment of Class 4 Prepetition Second Lien Secured Claims The treatment to be provided to Holders of Allowed Prepetition Second Lien Claims will depend on whether the Class accepts or rejects the Plan. If Class 4 accepts the Plan, then each Holder of an Allowed Prepetition Second Lien Claim will receive in full and complete settlement, release and discharge of the Claim: (i) the Lien Avoidance Release; (ii) its Pro Rata share of 4.5% of the shares of New Common Stock; (iii) its Pro Rata share of the New Warrants; and (iv) its Pro Rata Share of the Prepetition Second Lien Claim Trust Interests, which will entitle the Holder to a share of the net recoveries realized by the Litigation Trust. Any Administrative Expense Claims that may be asserted by Holders of Prepetition Second Lien Claims for adequate protection under the terms of the DIP Order will be reduced, in an amount equal to the value of the New Common Stock and New Warrants distributed to the Holders, if and as determined by the Court in accordance with applicable law. If Class 4 rejects the Plan, then each Holder of an Allowed Prepetition Second Lien Claim will receive its Pro Rata Share of the Prepetition Second Lien Claim Trust Interests. Furthermore, the reasonable unpaid fees and expenses of counsel and the financial advisor to the Prepetition Second Lien Agent incurred prior to the Effective Date will be paid within 10 days after the Effective Date subject to the Debtors' prior receipt of invoices and reasonable supporting documentation. Determination of Section 507(b) Claims According to Richard E. Newsted, Meridian's president and chief executive officer, the Prepetition First Lien Lenders and the Prepetition Second Lien Lenders intend to assert "superpriority" claims under Section 507(b) of the Bankruptcy Code to the extent of any diminution in the value of their valid, perfected and unavoidable liens. Mr. Newsted relates that the purpose of the Section 507(b) Claims is to compensate the Prepetition Lenders for the diminution in the value of their prepetition collateral, which occurred as a result of insufficient adequate protection provided by the Debtors. To the extent that the Prepetition First Lien Lenders and the Prepetition Second Lien Lenders can demonstrate that their interests in prepetition Collateral have suffered a diminution in value from and after the Petition Date, they may be able to establish Section 507(b) Claims in the amount of the diminution. The Court will determine whether the Section 507(b) Claims should be reduced by the total amount, or a portion, of the adequate protection payments that the Prepetition First Lien Lenders and the Prepetition Second Lien Lenders have received under the DIP Order since the Petition Date. In the case of Prepetition Second Lien Lenders, the Court will also determine whether Allowed Section 507(b) Claims should be reduced by the value of the New Common Stock and New Warrants the Second Lien Lenders will receive if Class 4 accepts the Plan. Effect of Section 507(b) Claims The amount of any Section 507(b) Claims in favor of the Prepetition Lenders may be significant in determining how any recoveries obtained by the Litigation Trust will be distributed, Mr. Newsted acknowledges. The Plan provides that after the payment of expenses incurred by the Litigation Trust in prosecuting the Avoidance Actions and the Reserved Actions, the remaining recoveries by the Litigation Trust will be distributed as: (a) If Class 4 accepts the Plan: -- 30% of the proceeds will be used to pay the Section 507(b) Claims held by the Prepetition First Lien Lenders; -- 70% of the proceeds will be used to pay the Section 507(b) Claims held by the Prepetition Second Lien Lenders; and -- any remaining amounts will be distributed pro rata to the Holders of Prepetition First Lien Deficiency Claims, Prepetition Second Lien Claims, and General Unsecured Claims; (b) if Class 4 rejects the Plan, the net recoveries by the Litigation Trust will be distributed pro rata on account of the Section 507(b) Claims in favor of the Prepetition First Lien Lenders and the Prepetition Second Lien Lenders and thereafter will be distributed pro rata among the Holders of Prepetition First Lien Deficiency Claims, Prepetition Second Deficiency Claims, and General Unsecured Claims, after giving effect to the rights of the Prepetition Agents and the Prepetition Lenders under the Intercreditor Agreements. The Plan defines "Prepetition Second Lien Deficiency Claim" as that portion of the Prepetition Second Lien Claim that constitutes an Unsecured Claim. Mr. Newstead reports that the specific Reserved Actions and Avoidance Actions that will be contributed to the Litigation Trust will be identified prior to the Confirmation Date to ensure that they are properly preserved for the benefit of the Litigation Trust. Debtors Address Committee's Concerns If the Court determines that the Prepetition Lenders hold substantial Section 507(b) Claims, it is unlikely that the Holders of General Unsecured Claims will receive any distributions under the Plan, Mr. Newsted concedes. It is still, however, possible that the Holders of General Unsecured Claims will receive distributions if the Prepetition Lenders are not successful in establishing the Section 507(b) Claims. Thus, the Debtors do not believe that Class 5 should be deemed to have rejected the Plan pursuant to Section 1126(g) of the Bankruptcy Code. The Debtors have not taken a position regarding the amount or validity of any Section 507(b) Claims that may be asserted by the Prepetition Lenders. The amount of the Section 507(b) Claims will be determined by the Court after notice and a hearing, and the Committee will have the opportunity to contest the allowance of any Section 507(b) Claims, Mr. Newsted clarifies. Nevertheless, Mr. Newsted notes, the Plan provides that the Committee will be dissolved on the Effective Date and will not continue to exist thereafter except for the limited purposes of filing any remaining applications for payment of professional fees and expenses, and completing any proceedings related to the determination of the amount of any Administrative Expense Claims asserted by the Holders of Prepetition First Lien Claims or Prepetition Second Lien Claims under the terms of the DIP Order. The Committee has asserted that the significant amount in postpetition interest, fees and expenses paid to the Prepetition Lenders as adequate protection under the DIP Order should be disgorged or reapplied to reduce the principal obligations owed to the Prepetition Lenders as of the Petition Date, because the Plan is based on the assumption that the Prepetition Lenders are undersecured for purposes of Section 506(b) of the Bankruptcy Code. The Debtors believe that the Committee's argument is flawed because it disregards the possibility that the Prepetition Lenders may hold substantial Section 507(b) Claims, which are subject to the Court's determination, and that the Section 507(b) Claims may exceed the total adequate protection payments received by the Prepetition Lenders, in which case the payments would not be subject to recharacterization or disgorgement under Section 506(b). The Committee has argued that the reservation of 10% of the shares of New Common Stock for issuance to certain members of the Reorganized Debtors' management pursuant to the Management Incentive Plan constitutes a "gift" that may violate the absolute priority rule. The Debtors disagree with the Committee's position and point out that no shares of New Common Stock are being issued under the Plan to their management members. Furthermore, the Debtors explain that any shares of New Common Stock to be issued in the future to their members under the Management Incentive Plan will be in the nature of incentive compensation for future services and will not be issued in consideration for prepetition services to the Debtors or on account of any Claims that the individuals may hold against the Debtors. The Debtors are not aware of any existing liabilities to the Pension Benefit Guaranty Corporation for unfounded benefits or other obligations under the Pension Plans, and intend to comply with all of their obligations. Mr. Newsted relates that the PBGC has asserted these Claims against each of the Debtors: (a) A contingent claim for $199,951 and additional unliquidated claims on account of minimum funding contributions under the Pension Plans; (b) Unliquidated claims on account of insurance premiums under the Pension Plans; and (c) Contingent claims totaling $13,882,000 and $3,118,500 on account of unfunded benefit liabilities. The Debtors believe that they are current on all of their obligations under the Pension Plans. The Plan discloses that the Debtors and their business performance are and will be affected by further production cutbacks by Ford, General Motors, DaimlerChrysler, and any operational restructuring initiatives by the North American automakers to the extent that the initiatives have a negative impact on production levels. Exit Facility The Reorganized Debtors expect the Exit Facility, in the total amount of up to $180,000,000, to consist of: (i) a $75,000,000 senior secured revolving line of credit; and (ii) a senior secured term loan in the principal amount of up to approximately $75,000,000, plus a synthetic letter of credit facility of up to approximately $30,000,000. Other Matters All prepetition employment contracts with any individual current or former employee, officer, director or consultant relating to employment, compensation, benefits, severance, and indemnification will be rejected as of the Effective Date. All obligations of the Debtors to indemnify any individuals other than the Meridian Covered Persons pursuant to existing articles or certificates of incorporation, by-laws, other constituent documents, contracts and applicable statutes will be discharged on the Effective Date. A full-text blacklined copy of the Revised Fourth Amended Joint Plan of Reorganization if available for free at http://ResearchArchives.com/t/s?1335 A full-text blacklined copy of the Revised Fourth Amended Disclosure Statement is available for free at http://ResearchArchives.com/t/s?1336 Plan Compendium The Debtors also delivered to the Court a revised Plan Compendium for the Fourth Amended Plan. The seven Plan Compendium Exhibits are: 1. Certificate of Incorporation Meridian's Certificate of Incorporation states that the company is authorized to issue a total of 2,556,000 shares of Common Stock with a par value of $.01 per share. A full-text blacklined copy of Meridian's Certificate of Incorporation is available for free at: http://ResearchArchives.com/t/s?1337 2. Reorganized Meridian's By-Laws, a full-text blacklined copy of which is available for free at: http://ResearchArchives.com/t/s?1338 3. Agreement of Plan and Merger between the Michigan and Delaware corporations of the company Immediately after the consummation of the Merger, an aggregate 2,000,000 shares of Common Stock, par value $0.01 per share, of the Surviving Corporation will be issued to the Holders of Prepetition First Lien Secured Claims and Prepetition Second Lien Claims. In accordance with the Plan, the directors and officers of Delaware Meridian as of the Effective Time will be the directors and officers of the Surviving Corporation. A full-text blacklined copy of the Agreement of Plan and Merger is available for free at http://ResearchArchives.com/t/s?1339 4. Michigan Merger Certificate, a full-text blacklined copy of which is available for free at: http://ResearchArchives.com/t/s?133a 5. Delaware Merger Certificate, a full-text blacklined copy of which is available for free at: http://ResearchArchives.com/t/s?133b 6. Litigation Trust Agreement, a full-text blacklined copy of which is available for free at: http://ResearchArchives.com/t/s?133c 7. Warrant "Subsequent Issuance" will mean any sale or issuance by Reorganized Meridian of Common Stock, Convertible Securities or Stock Purchase Rights after the Original Issue Date other than, among others, any issuance of shares of Common Stock or Stock Purchase Rights to officers and employees of the company or its subsidiaries in accordance with any management incentive program. Immediately after the issuance of any shares of Stock Purchase Rights, the sum of (A) the total number of shares of Common Stock issued or subject to Stock Purchase Rights pursuant to the program, and (B) the maximum number of shares of Common Stock that may be issued in the future under the program, will not exceed 255,556 shares. A full-text blacklined copy of the Warrant is available for free at http://ResearchArchives.com/t/s?133d 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. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). MERIDIAN AUTOMOTIVE: Committee Objects to Disclosure Statement -------------------------------------------------------------- Under Meridian Automotive Systems, Inc., and its debtor- affiliates' Fourth Amended Plan of Reorganization, general unsecured creditors receive the right to share in the recoveries of a Litigation Trust on a pro rata basis with the deficiency claims of the Lenders but only after payment of any Allowed Administrative Claims held by the Lenders, Gregory A. Taylor, Esq., at Ashby & Geddes, P.A., in Wilmington, Delaware, states. The holders of Prepetition First Lien Claims and Prepetition Second Lien Claims -- the First Lien and Second Lien Lenders -- have informed the Official Committee of Unsecured Creditors that they intend to assert massive claims under Section 507(b) of the Bankruptcy Code, Mr. Taylor relates. The Lenders have further advised the Committee that when their 507(b) Claims are determined, the Claims will consume all of the assets of the Litigation Trust. The Committee complains that the Disclosure Statement is deficient in its discussion of the purported 507(b) Claims, the allowance of which would materially impact recoveries to general unsecured creditors. In particular, Mr. Taylor points out, the Disclosure Statement: -- contains no discussion or evaluation of the extent or validity of the 507(b) Claims; and -- does not explain that the right of general unsecured creditors to receive a distribution is contingent upon defeating the 507(b) Claims. Mr. Taylor notes that if the 507(b) Claims consume all the assets of the Litigation Trust, Class 5 General Unsecured Creditors will receive no distribution. Consequently, the distribution from the Litigation Trust promised to general unsecured creditors in the Fourth Amended Plan is illusory, Mr. Taylor contends. Class 5 should be deemed to reject the Plan if they will not receive a distribution. The Disclosure Statement inappropriately suggests that the DIP Order granted the Lenders liquidated 507(b) Claims, Mr. Taylor asserts. Mr. Taylor emphasizes that the DIP Order granted the Lenders "status," and not "claims," under Section 507(b). "The Lenders are still required to prove that they hold any claims under Section 507(b) for a failure of adequate protection." Mr. Taylor points out that upon the Effective Date of the Fourth Amended Plan, only two entities will be in a position to analyze and oppose the Lenders' 507(b) Claims -- the Reorganized Debtors and the Litigation Trustee who takes its direction from the Oversight Committee. The Reorganized Debtors will have no incentive to oppose the 507(b) Claims because as of the Effective Date, they will be controlled by the Lenders, Mr. Taylor relates. The Oversight Committee will, by definition, also be controlled by the Lenders. As a result, the Lenders' 507(b) Claims and any of their other Administrative Expense Claims will be allowed without examination or opposition, Mr. Taylor says. "Due process demands that general unsecured creditors are adequately represented in opposing the 507(b) Claims," Mr. Taylor contends. "The Disclosure Statement and the Plan should require the Lenders to timely assert any 507(b) Claims so that they may be determined at the Plan confirmation hearing after notice and opportunity to object by the Committee prior to its dissolution." Mr. Taylor argues that the Disclosure Statement: -- fails to mention that the Lenders' right to accrue or receive payment of postpetition interest and reasonable fees and expenses under the applicable prepetition lien and loan documents is subject to Section 506 of the Bankruptcy Code; -- does not detail the basis for the First Lien Lenders' "gifting" of 4.5% of the equity in the Reorganized Debtors to the Second Lien Lenders if they vote to accept the Plan, and 10% of the equity to management as an incentive; and -- does not specify reservations of claims and causes of action and consequently does not preserve the right to pursue the assets on a post-confirmation basis. Approximately $45,000,000 of postpetition interest, fees and expenses has already been paid to the Lenders and their professionals during the course of the Chapter 11 cases, Mr. Taylor notes. Under Section 506, however, only an oversecured creditor is entitled to receive payment of that amount. If Section 506 is applied, then the $45,000,000 paid to the Lenders should be disgorged or reapplied to reduce the outstanding obligations owing to the Lenders as of the Petition Date, Mr. Taylor contends. The Plan proposed to substantively consolidate the Debtors for Plan purposes only, except that distribution of recoveries from the Litigation Trust are to be made on a non-consolidated basis, Mr. Taylor notes. If the Litigation Trustee recovers upon a cause of action that was contributed to the Litigation Trust, only those creditors that have direct claims against the estate to which the recovery is attributable may share in the proceeds. As the Lenders have principle or guaranty claims against each of the Debtors, the exception to substantive consolidation works only against general unsecured creditors, Mr. Taylor contends. The Committee asserts that the Disclosure Statement should describe how recoveries would differ for general unsecured creditors if there is a full substantive consolidation as opposed to the partial substantive consolidation that is proposed. If the sole potential distribution, if any, to unsecured creditors is to be accomplished on a non-consolidated basis, then unsecured creditors should be able to vote in favor or against the Plan on a non-consolidated basis, the Committee argues. The Committee maintains that substantive consolidation is appropriate to all creditors. Mr. Taylor contends that the Disclosure Statement is also deficient in numerous other aspects: -- It discusses financial results up to fiscal year 2005 but does not include any description of results for the current year; -- It defines Administrative Expense Claims to include "any Prepetition Second Lien Priority Claim," which is not defined anywhere in the Plan or Disclosure Statement; -- It does not quantify the possible Pension Benefit Guaranty Corporation liabilities or state what the PBGC asserts to be its claims; -- It does not reflect recent announcements by the Ford Motor Company and Chrysler Corp. regarding production cutbacks and operational restructurings that pose risks to the Debtors' ability to reorganize successfully and carry out the Plan; and -- It is devoid of any description of the mechanics that will govern distribution of trust interests, including the form of the interests to be distributed, the identity of the holder of the interests for each class, and the calculation of the number of trust interests to be distributed. "In reality, the Plan represents a wholesale departure from the consensual approach previously taken by the Debtors pursuant to which the Committee was a co-proponent of the prior version of the Plan submitted to the Court," according to Mr. Taylor. "The Committee was not consulted prior to the filing of the current Plan, is no longer a co-proponent of the Plan and will, absent a resolution with the Lenders, oppose confirmation of the Plan," Mr. Taylor says. "The Plan is a step backwards for unsecured creditors." 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. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). MERIDIAN AUTOMOTIVE: Committee Objects to Solicitation Procedures ----------------------------------------------------------------- The Official Committee of Unsecured Creditors of Meridian Automotive Systems, Inc., and its debtor-affiliates asks the U.S. Bankruptcy Court for the District of Delaware to deny the Solicitation Motion or direct the Debtors to amend the Solicitation Procedures so that it will be consistent with its requests. The Official Committee of Unsecured Creditors believes that the Debtors' prepetition lenders will assert massive claims under Section 507(b) of the Bankruptcy Code. The Lenders have advised the Committee that their 507(b) Claims will wipe out any recovery for general unsecured creditors under the Fourth Amended Joint Plan of Reorganization, Gregory A. Taylor, Esq., at Ashby & Geddes, P.A., in Wilmington, Delaware, informs the Court. Under the Fourth Amended Plan, the Lenders will obtain a release that will insulate their claims from application of Section 506(b) of the Bankruptcy Code. The fundamental premise of the Plan is that the Lenders are undersecured. However, Mr. Taylor notes, the Lenders have received up to $45,000,000 in postpetition interest, fees and expenses during the course of the bankruptcy cases. The Committee will be dissolved on the Effective Date of the Fourth Amended Plan. The duty of examining and, if appropriate, opposing the Lenders' 506(b) Claims and the 507(b) Claims will then rest with the Reorganized Debtors or the Liquidating Trustee under the direction of the Oversight Committee. Mr. Taylor points out that both the Reorganized Debtors and the Oversight Committee will be controlled by the Lenders on the Effective Date, thus neither of the entities can be expected to scrutinize or oppose the 506(b) Claims or the 507(b) Claims. If the Court approves the Disclosure Statement and establishes a Plan Confirmation timeline, the Committee asks the Court to simultaneously: (a) set a pre-confirmation bar date for the filing of the 506(b) Claims and 507(b) Claims by the Lenders; and (b) establish pre-confirmation discovery and trial schedules on those claims and other matters that may have a significant impact upon recoveries for general unsecured creditors. Bankruptcy Rule 3017(d) provides that a bankruptcy court may direct a debtor to include certain information in its solicitation package that will be delivered to creditors in connection with voting upon a Chapter 11 plan. The Committee has prepared a letter to be mailed to creditors together with the Debtors' solicitation materials. Mr. Taylor asserts that the inclusion of the letter with the Debtors' solicitation materials is a cost-effective method of informing creditors of the Committee's position on the Plan. The Debtors have asked the Court to approve certain "voting procedures and standard assumptions" to serve as guidelines for the tabulation of ballots. Mr. Taylor contends that the Procedures grant the Debtors wide discretion to pick and choose which ballots should be counted toward Plan confirmation. Mr. Taylor points out that the Debtors' proposed order notes: -- The Debtors may reject ballots in their "sole discretion" if the ballots are not in "proper form;" -- The Debtors may in their "sole discretion" reject ballots as invalid if the ballots are received after the Voting Deadline; -- A vote may be withdrawn with the "prior consent of the Debtors;" and -- Defects or irregularities in delivery of a ballot must be cured within the time as the Debtors or the Court determine. "There is no safeguard that will prevent the Debtors from exercising this discretion in an arbitrary or capricious manner to suit their own needs," Mr. Taylor argues. "In order to ensure consistent and fair application of the balloting procedures, the Debtors should be required to consult with the Committee in exercising discretion in these matters." 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. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). MESABA AVIATION: May Shut Down If Employees Refuse Pay Cuts ----------------------------------------------------------- The Associated Press reports that Mesaba Aviation, Inc., is losing $1,000,000,000 per week and may be forced to shut down if its union-represented pilots, flight attendants and mechanics don't concede to concessions. The Debtor has already obtained permission from the Honorable Gregory F. Kishel of the U.S. Bankruptcy Court for the District of Minnesota to impose new terms on its employees. However, employees are threatening to strike if that happens, Joshua Freed of Associated Press reports. "A strike would be as fatal as an orderly shutdown," Mesaba President John Spanjers wrote workers in a newsletter, which contained bar charts indicating Mesaba's zero progress in the labor department of its cost savings measures. "You can look at numbers and charts and graphs until the cows come home, but the fact of the matter is that there's a market rate . . . for pilots, flight attendants and mechanics, and we're going to be in that ballpark," Tom Wychor, a Mesaba captain and head of its pilot union, told the AP. "If they can't pay market rates, then they probably don't belong in business." Mr. Wychor says the unions are offering pay cuts of more than 14 percent -- a rate that's close enough to make a deal. About Mesaba Aviation Headquartered in Eagan, Minnesota, Mesaba Aviation, Inc., dba Mesaba Airlines -- http://www.mesaba.com/-- operates as a Northwest Airlink affiliate under code-sharing agreements with Northwest Airlines. The Company filed for chapter 11 protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258). Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman PA, represents the Debtor in its restructuring efforts. Craig D. Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed total assets of $108,540,000 and total debts of $87,000,000. (Mesaba Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) METROPCS WIRELESS: Moody's Junks Senior Unsecured Bond's Rating --------------------------------------------------------------- Moody's Investor Service assigned a B3 Corporate Family, B1 Senior Secured and Caa2 Senior Unsecured ratings to MetroPCS Wireless, Inc. The ratings reflect a B3 probability of default and loss given default assessments of LGD 2 for the senior secured facilities and LGD 5 for the senior unsecured notes. The outlook is stable. The B3 Corporate Family Rating reflects Moody's view that MetroPCS' business risks are relatively high as a small, regional wireless operator providing a price-oriented offering, competing against much larger national players. These risks are partially mitigated by the company's low cost structure and strong track record in its existing markets. However, Moody's noted that high business risks are now being exacerbated by significant financial risks as the company increases its consolidated leverage to the upper 7x range by the end of 2006, and consumes cash over the next few years to expand into maturing markets. Ratio calculations are per Moody's published methodology, which primarily include Basket 'B', 75% debt treatment of the preferred shares and the capitalization of operating leases. The stable outlook reflects our view that MetroPCS' ongoing expansion plans into new markets will likely limit improvement to key credit metrics over the next few years. Assignments: Issuer: MetroPCS Wireless, Inc. * Corporate Family Rating, Assigned B3 * Senior Secured Bank Credit Facility, Assigned B1, LGD 2, 26% * Senior Unsecured Regular Bond/Debenture, Assigned Caa2, LGD 5, 80% * Probability of Default Rating, Assigned B3 MetroPCS Wireless, Inc. is a regional wireless operator wholly owned subsidiary of MetroPCS Communications, Inc. Both companies are based in Dallas, Texas. MICHAELS STORES: S&P Rates Planned $2.4 Billion Term Loan at B- --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' corporate credit rating to Irving, Texas-based crafts retailer Michaels Stores Inc. The outlook is developing. At the same time, Standard & Poor's assigned its 'B-' rating to the company's planned $2.4 billion term loan B. A recovery rating of '2' was also assigned to the loan, indicating the expectation of substantial (80%-100%) recovery of principal in the event of a payment default. Standard & Poor's also assigned its 'CCC' rating to the company's planned $700 million senior unsecured notes and $700 million subordinated notes. Proceeds from the offerings, as well as $400 million from a $1 billion unrated asset-based revolving credit facility, and $1.8 billion of equity, will be used to fund the purchase of the company by Bain Capital and The Blackstone Group. The ratings on Michaels reflect the risks associated with the company's participation in the competitive and highly fragmented crafts industry and the challenges of managing new-store growth amid a very highly leveraged capital structure that limits cash flow protection. Michaels, with about $3.7 billion in sales, is the largest and only national specialty retailer featuring arts, crafts, framing, floral, decorative wall decor, and seasonal merchandise for the hobbyist and do-it-yourself home decorator. The company operates 1,085 retail stores in the U.S. and Canada, compared with about 370 for the next largest competitor, Hobby Lobby. The company plans to continue to expand its store base by about 50 new Michaels stores per year. MILLS CORP: Completes $988 Mil. Asset Sale to Ivanhoe Cambridge --------------------------------------------------------------- The Mills Corporation has completed the previously disclosed sale of its interests in Vaughan Mills (Ontario, Canada), St. Enoch Centre (Glasgow, Scotland) and Madrid Xanadu (Madrid, Spain) to Ivanhoe Cambridge, Inc., for approximately $988 million, with net proceeds of approximately $500 million before transaction costs, but net of expected foreign taxes. Approximately $400 million was used to immediately pay down a portion of the Senior Term loan with Goldman Sachs Mortgage Company, as Administrative Agent. A significant portion of the remaining proceeds are being held in escrow for foreign taxes in an amount in excess of the taxes expected to be due. Additional proceeds are being held in connection with the previously disclosed litigation with Parcelatoria de Gonzalo Chacon. Most on-site employees were retained by Ivanhoe Cambridge as part of the transfer. "This transaction demonstrates that we are moving forward with our efforts to sell all or part of the Company," said The Mills Corporation Chief Executive Officer and President Mark S. Ordan. About Ivanhoe Cambridge Headquartered in Montreal, Quebec in Canada, Ivanhoe Cambridge -- http://www.ivanhoecambridge.com/-- is one of Canada's pre-eminent property owners, managers, developers and investors. The Company focuses on high-quality shopping centres located in urban areas. Its real estate portfolio consists of more than 43.2 million square feet of retail space and includes over 65 regional and super-regional shopping centers. As of Dec. 31, 2005, the market value of Ivanhoe Cambridge's assets reached CDN$9.3 billion. About Mills Corp Headquartered in Chevy Chase, Maryland, The Mills Corporation (NYSE:MLS) -- http://www.themills.com/-- develops, owns, manages retail destinations including regional shopping malls, market dominant retail and entertainment centers, and international retail and leisure destinations. The Company owns 42 properties in the U.S., Canada and Europe, totaling 51 million square feet. In addition, The Mills has various projects in development, redevelopment or under construction around the world. * * * As reported in the Troubled Company Reporter on March 24, 2006, The Mills Corporation disclosed that the Securities and Exchange Commission has commenced a formal investigation. The SEC initiated an informal inquiry in January after the Company reported the restatement of its prior period financials. Mills is restating its financial results from 2000 through 2004 and its unaudited quarterly results for 2005 to correct accounting errors related primarily to certain investments by a wholly owned taxable REIT subsidiary, Mills Enterprises, Inc., and changes in the accrual of the compensation expense related to its Long-Term Incentive Plan. NATIONAL PROCESSING: Moody's Rates $140 Mil. Senior Loan at Caa2 ---------------------------------------------------------------- Moody's Investors Service assigned a first time B3 Corporate Family Rating to National Processing Company Group, Inc., to be formed by combining Retriever Payment Systems, Inc., Retriever's current acquisitions of an independent sales organization portfolio from Bank of America and Best Payment Solutions, Inc. Ratings assigned: * Corporate family rating B3; * Probability-of-default rating B3; * $50 million senior secured revolver due 2012 B2; * $390 million senior sec. first lien term loan due 2013 B2; * $140 million senior sec. second lien term loan due 2014 Caa2 At the same time, Moody's also assigned ratings to proposed bank financings. The ratings of the facilities reflect both the overall probability of default of the company, to which Moody's assigns a PDR of B3, and a loss given default of LGD 3 for the first lien and LGD 5 for the second lien facilities. The B2 senior bank rating incorporates the senior debt's first priority lien on all assets, and pledged capital stock, as applicable, of each subsidiary, and the Caa2 rating on the second lien facilities, two notches below the corporate family rating, speaks to its junior position in the liability structure. The rating outlook is stable. NPC's B3 corporate family rating reflects its: (i) its high leverage as a result of the current acquisition of the ISO portfolio from Bank of America; (ii) potential changes of competitive landscape with bigger players focus on the small/medium/business -- the segment NPC focuses on; (iii) possible integration challenges especially considering the size of the ISO acquisition relative to NPC's organic business and NPC will need to invest in support infrastructure which will not come as part of the ISO sale. The rating is also constrained given the lack of audited financial statements for the ISO asset which will represent over 65% of the pro forma EBITDA. The rating also considers: (i) generally favorable growth prospects for the electronic payment industry; (ii) the increased size and scale achieved by NPC, post its ISO acquisition, in the SMB space; (iii) its diverse merchant portfolio in terms of sectors and geography served, and (iv) the expectation that NPC will generate free cash flow post the current financing. Factors which may prompt Moody's to consider upgrading the rating include: 1) the receipt of audited financial statements with results that are consistent with what has been incorporated in the current rating; and 2) evidence of successful spinout and integration of the ISO asset. Factors which may prompt Moody's to consider downgrading the rating include: 1) deterioration of financial performance partly through customer attrition and increasing competitive landscape; and 2) further increase in leverage either as a result of further debt financed acquisitions or declining financial results due to competitive and operating issues. National Processing Company will be formed by combining Retriever Payment Systems, the ISO assets merchant acquiring business of Bank of America and BPS, providing a broad range of credit card transaction processing support services for all major credit and debit cards to small and medium-sized merchants throughout the United States. NEOPLAN USA: Files Amended Disclosure Statement in Delaware ----------------------------------------------------------- Neoplan USA Corporation and its debtor-affiliates delivered to the U.S. Bankruptcy Court for the District of Delaware an Amended Disclosure Statement explaining their Amended Joint Chapter 11 Plan of Liquidation. Overview of the Plan The Amended Plan contemplates the substantive consolidation of the four Debtors into a single entity solely for the purposes of all actions and distributions under the Plan. After the effective date, the Debtors' estates will be liquidated and the operations of the Debtors will become the responsibility of the Plan Administrator. In addition, the Debtors are liable for the Senior Secured Lender Claims and each has pledged its assets to secure claims. Treatment of Claims Under the Amended Plan, Administrative Claims, Other Priority Claims and Other Secured Claims will be paid in full and in cash. Priority Tax Claims will also be paid in full and in cash. Holders of Senior Secured Lender Claims will receive: * a pro rata share of the available assets and remaining assets, and * the Senior Secured Lender Release. Holders of General Unsecured Claims will receive a pro rata share of available assets and remaining assets, after full payment of Senior Secured lender Claims. Interest and Interest Related Claims will be cancelled and holders will receive nothing under the plan. A blacklined copy of the Amended Disclosure Statement is available for a fee at: http://www.researcharchives.com/bin/download?id=061010214018 About Neoplan USA Headquartered in Denver, Colorado, Neoplan USA manufactures standard floor buses, low floor buses, and articulated buses. Neoplan USA licenses its designs from the German corporation, Neoplan. Neoplan USA is entirely separate from Neoplan in Germany. The Company, its parent, IAP Acquisition Corporation, and two affiliates, filed for chapter 11 protection on Aug. 17, 2006 (Bankr. D. Del. Lead Case No. 06-10872). Tobey M. Daluz, Esq., at Ballard Spahr Andrews & Ingersoll LLP, represents the Debtors. When Neoplan USA filed for protection from its creditors, it listed $13,696,911 in total assets and $59,009,471 in total debts. NORTHWEST AIRLINES: 3V Capital & Pierce Want to File $2.07MM Claim ------------------------------------------------------------------ 3V Capital Master Fund, Ltd., and Pierce Diversified Strategy Master Fund, LLC, as the ultimate assignees of Diversified Distribution Services, Inc., ask the U.S. Bankruptcy Court for the Southern District of New York for leave to file a claim in the total amount of $2,075,245 against Northwest Airlines, Inc., and its debtor-affiliates. The claim arises from DDS's prepetition delivery of goods and services to the Debtors. The Debtors listed in their Schedules of Assets and Liabilities that the $2,075,245 claim is contingent, unliquidated and disputed. On April 25, 2006, DDS assigned all its right, title and interest in the Claim to APS Clearing, Inc. Two days later APS Clearing assigned all of its right, title and interest in the Claims to 3V Capital and Pierce. On behalf of 3V and Pierce, Douglas M. Tisdale, Esq., at Tisdale & Associates, LLC, relates that on the assignments of the Claim, there was an express representation by DDS that it would be the entity allowed to file proofs of claim in the proceedings on account of the Claim. According to Mr. Tisdale, DDS's representation caused APS, and 3V and Pierce to understand that DDS would file a proof of claim. However, DDS failed to notify APS, or 3V and Pierce that it failed to timely file a proof of claim. 3V and Pierce discovered, through the performance of routine back-office audits of claims held, that DDS has not filed a proof of claim. Mr. Tisdale contends that the omission to file a proof of claim was not pure inadvertence on the part of 3V and Pierce because they were led to believe that DDS would cause the filing on its own. Mr. Tisdale also argues that the Claims will not burden the reorganization process or open the floodgates for the filing of similar claims. He notes that the Debtors have not filed a plan of reorganization. He also maintains that 3V and Pierce's situation is unique. 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. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) NORTHWEST AIRLINES: Okays Extension of MAC's Section 1110 Period ---------------------------------------------------------------- Northwest Airlines, Inc., and its debtor-affiliates have granted to the Metropolitan Airports Commission a security interest in certain engine parts and airframe and avionic parts that they own pursuant to certain financing agreements. The Debtors and MAC dispute whether the Aircraft Equipment is "equipment" within the meaning of Sections 1110(a)(3)(A)(i) and 1110(a)(3)(B) of the Bankruptcy Code and whether the Aircraft Equipment is subject to the provisions of Section 1110. Pursuant to Section 1110(b), the Debtors and MAC entered into stipulations under to extend the 60-day period set forth in Section 1110(a)(2) with respect to the Aircraft Equipment effective November 12, 2005, until 11:59 p.m. New York time on October 1, 2006. The parties also entered into a stipulation granting adequate protection, resolving certain Section 1110 issues and other matters. The stipulation was set to expire on October 1, 2006. The Debtors have requested MAC to further extend the Section 1110 Period until 11:59 p.m. New York time on February 1, 2007 or the earlier date MAC may agree to or as provided for in their Adequate Protection Stipulation. MAC has agreed to the extension, subject to: (a) the terms of the Stipulation and the Adequate Protection Stipulation; and (b) agreement by the Debtors that during the Extension Period they will maintain the Aircraft Equipment in compliance with applicable U.S. Federal Aviation Administration regulations. The parties also desire to amend the Adequate Protection Stipulation to extend the term to February 1, 2007. If the U.S. Bankruptcy Court for the Southern District of New York does not approve the Extension Stipulation by November 15, 2006, the Section 1110 Period will terminate at 11:59 p.m. New York time on that day. The parties agree and acknowledge that the Extension Stipulation does not constitute an agreement to perform obligations under their Financing Agreements under Section 1110(a) and it is not an admission by any party as to the applicability of Section 1110. 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. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) NOVA CDO: S&P Junks Ratings on Class C Notes -------------------------------------------- Standard & Poor's Ratings Services raised its rating on the class B notes issued by NOVA CDO 2001 Ltd., a high-yield arbitrage CBO transaction, and removed it from CreditWatch, where it was placed with positive implications on July 25, 2006. At the same time, the ratings on the class C-1 and C-2 notes are lowered. Additionally, the rating on the class A notes is affirmed based on a financial guarantee insurance policy issued by Financial Security Assurance Inc. The raised rating on the class B notes reflects factors that have positively affected the credit enhancement available to support the notes since the class C and D notes were downgraded in September 2004, primarily paydowns to the class A notes. The transaction paid down the class A notes by $0.43 million on the August 2005 payment date, $116.60 million on the February 2006 payment date, and $19.79 million on the August 2006 payment date, reducing the class A balance by $136.82 million. The lowered ratings on the class C-1 and C-2 notes reflect a higher concentration risk given the relatively small size of the pool. According to the September 2006 trustee report, the transaction's collateral pool included $38.01 million in debt securities and $1.65 million in principal cash, while the sum of the liability balances for the class A, B, and C notes was $39.10 million. As a result, the class C overcollateralization (o/c) ratio is 101.23%, versus the required ratio of 103.0% and compared with a ratio of 102.60% at the time of the September 2004 rating actions. Another factor contributing to the lower o/c ratio is the increased number of calls experienced by some of the securities in the collateral pool, which has caused the transaction to become overhedged. Rating Raised and Off Creditwatch Positive NOVA CDO 2001 Ltd. Rating ------ Class To From ----- -- ---- B BBB+ BBB/Watch Pos Ratings Lowered NOVA CDO 2001 Ltd. Rating ------ Class To From ----- -- ---- C-1 CCC- CCC+ C-2 CCC- CCC+ Rating Affirmed NOVA CDO 2001 Ltd. Class Rating ----- ------ A AAA Other Outstanding Ratings NOVA CDO 2001 Ltd. Class Rating ----- ------ D-1 CC D-2 CC NUANCE COMMS: 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. Technology Software sectors, the rating agency confirmed its B2 Corporate Family Rating for Nuance Communications, 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 ---------- ------- ------- ------ ---------- $75 Million Senior Secured Revolving Credit Facility due 2012 B1 B1 LGD3 30% $355 Million Senior Secured First Lien due 2013 B1 B1 LGD3 30% 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- umeric 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%). Nuance Communications, Inc., formerly ScanSoft, Inc., is a provider of speech and imaging solutions for business and consumers around the world. Its technologies, applications and services seek to improve user experiences by changing the way people access, share, manage and use information. OMEGA POLYMER: Selling all Assets to Resilience Capital ------------------------------------------------------- Resilience Capital Partners has signed a definitive purchase agreement to acquire substantially all the assets of Omega Polymer Technologies Inc., subject to Bankruptcy Court approval. Omega listed 225 employees when it filed for bankruptcy court protection citing raw material price increases and high operating costs. "There is no question in our minds that with our significant equity investment and proper execution Omega can stem its losses, quickly be stabilized and eventually turned around. In most businesses today you are competing with the world and there are some tough competitors out there. It is clear that in the coming years many companies will find themselves in a similar situation as Omega of having to manage aggressively and find new investment capital in order to survive" said Steven Rosen, a Managing Partner of Resilience Capital. Omega has been in a turnaround situation for the several months leading up to its bankruptcy filing. "Omega is fortunate to have dedicated employees and customers and we are very much looking forward to working with them," added Bassem Mansour, a Managing Partner at Resilience Capital. About Resilience Capital Resilience Capital Partners -- http://www.resiliencecapital.com/ -- is a private equity firm based in Cleveland, Ohio focused on investing in underperforming and turnaround situations. Resilience typically acquires companies with revenues of $25 million to $250 million. Resilience manages two private equity funds with capital under management of over $75 million. Since its inception in 2001, Resilience has acquired nine companies with revenues in excess of $500 million. About Omega Headquartered in Aurora, Ohio Omega Polymer Technologies Inc. -- http://www.omegapultrusions.com/-- manufactures high volume, thin wall, complex pultruded lineals for the transportation, construction, consumer, corrosion, and electrical markets. The Company filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Western District of Pennsylvania on Aug. 21, 2006. ONEIDA LTD: April 29 Stockholders' Deficit Widens to $43.5 Million ------------------------------------------------------------------ Oneida Ltd. filed its financial statements for the first fiscal quarter ended April 29, 2006, with the Securities and Exchange Commission on Sept. 14, 2006. At April 29, 2006, the Company's balance sheet showed $297,520,000 in total assets and $341,085,000 in total liabilities, resulting in a $43,565,000 stockholders' deficit. The Company had a $33,297,000 deficit at Jan. 28, 2006. The Company's April 29 balance sheet also showed strained liquidity with $149,965,000 in total current assets available to pay $48,829,000 in total current liabilities coming due within the next 12 months. Results of Operation Foodservice Net sales of Foodservice Division products during the three months ended April 29, 2006, decreased by $4,834,000 (10.8%), compared with the corresponding period in the prior year. The decline in sales is attributed to reduced demand from broadline/equipment & supply distributors, hotel and gaming, chain restaurants, airline industry and liquidation sales of approximately $1,600,000; $900,000; $1,700,000; and $500,000 respectively, including the impact of the Company's decision to discontinue distribution of common glassware products. These decreases were offset slightly by increased sales to the cruise line industry segment. The uncertainty associated with the Company's 2004 financial restructuring as well as general business trends also resulted in certain customers opting to either dual source their tabletop product requirements with competitors, or direct source from foreign manufacturers, which has resulted in lower sales in the current year, especially in the commodity flatware and dinnerware segments. Airline segment sales are down due to the continued financial condition of that sector. Consumer Net Sales for the Consumer division decreased by approximately $7,297,000 (23.5%) compared with the corresponding period in the prior year. In the Company's continuing effort to restructure the Oneida Outlet Store division, 24 stores were closed since January 2005 accounting for approximately $2,000 of the net sales reduction. In addition, dinnerware sales for the quarter were down approximately $2,200,000 (39.3%) compared with the first quarter of the prior year. This is mainly the result of the discontinuation of a major customer program and timing of new product introductions, which fall into the second calendar quarter in 2006 versus the first calendar quarter last year. Flatware sales were down approximately $2,800,000 (15.8%) compared with the same period in 2005. This is mainly due to the impact of a major department store merger, the timing of a major customer reorder, and the closeout of a catalog program. Both flatware and dinnerware sales were also impacted by an inventory reduction program undertaken by two major customers in the first fiscal quarter. International Net sales of the International division declined by $1,607,000 (11.6%) as compared with the same period in the prior year, primarily attributed to the Mexico and United Kingdom operations. The decrease in sales in the United Kingdom was impacted by the change in the Company's crystal product supplier and a general softness in the demand for retail tabletop products. Mexico sales volume was adversely impacted by the direct import strategy of certain large volume customers in the Company's commodity flatware and dinnerware segment. The Company reported a $10,450,000 net loss available to common stockholders for the first fiscal quarter ended April 29, 2006, compared with a $3,332,000 net loss for the same period ended April 30, 2005. Full-text copies of the Company's first fiscal quarter financials are available for free at http://ResearchArchives.com/t/s?1327 Going Concern Doubt As reported yesterday in the Troubled Company Reporter, auditors working for BDO Seidman, LLP, raised substantial doubt about Oneida Ltd.'s ability to continue as a going concern after auditing its consolidated financial statements for the year ended Jan. 28, 2006, and Jan. 29, 2005. The auditors pointed to the Company's uncertainties inherent in the bankruptcy process, recurring losses, ability to comply with all debt covenants under the existing debtor-in-possession financing agreement, ability to generate sufficient cash from operations, and obtain financing sources to meet its future obligations. About Oneida Ltd. Headquartered in Oneida, New York, Oneida Ltd. (OTC: ONEI) -- http://www.oneida.com/-- manufactures stainless steel and silverplated flatware for both the Consumer and Foodservice industries, and supplies dinnerware to the foodservice industry. Oneida also supplies a variety of crystal, glassware and metal serveware for the tabletop industries. The Company and its 8 debtor-affiliates filed for Chapter 11 protection on March 19, 2006 (Bankr. S.D. N.Y. Case Nos. 06-10489 through 06-10496). Douglas P. Bartner, Esq., at Shearman & Sterling LLP represents the Debtors. Credit Suisse Securities (USA) LLC is the Debtors' financial advisor. Scott L. Hazan, Esq., and Lorenzo Marinuzzi, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., represent the Official Committee of Unsecured Creditors. Robert J. Stark, Esq., at Brown Rudnick Berlack Israels LLP represents the Official Committee of Equity Security Holders. When the Debtors filed for protection from their creditors, they listed $305,329,000 in total assets and $332,227,000 in total debts. On May 12, 2006, Judge Gropper approved the Debtors' disclosure statement. The pre-negotiated plan of reorganization of Oneida Ltd. was confirmed, on Aug. 31, 2006. The Company emerged from Chapter 11 on Sept. 15, 2006, as a privately held company. OWENS CORNING: Torrejon Wants to Intervene in Bankruptcy Case ------------------------------------------------------------- Diana L. Torrejon seeks authority from the U.S. Bankruptcy Court for the District of Delaware to intervene in Owens Corning and its debtor-affiliates' chapter 11 cases, in order to represent and prosecute the interests of her father's estate in the Debtors' cases. Ms. Torrejon informs the Court that Motley Rice LLC and its members, Joseph Rice and Ronald Motley, used a fraudulent general power of attorney to act on behalf of her father, Joseph T. Torrejon. Ms. Torrejon presented to the Court a document containing a false and forged signature bearing her name. Ms. Torrejon contends that she is the "legal representative, sole principal and Major Share or Stockholder with voting rights to vote on any questions that may be lawfully submitted" to creditors or any debtors, including: * Babcock and Wilcox Company; * Pittsburgh Corning Corporation; * Armstrong World Industries, Inc.; * Owens Corning; * W.R. Grace & Co.; * U.S. Gypsum Corporation; * Federal-Mogul Global, Inc.; * G-I Holdings, Inc.; * North American Refractories Company; and * A.P. Green Industries, Inc. Ms. Torrejon also seeks to intervene in the Chapter 11 cases of those debtors. Mr. Torrejon was a named plaintiff in a 1993 lawsuit, styled as Carlough, et al., v. Amchem Products, Inc., et al., seeking damages against various entities for asbestos-related personal injuries. Mr. Torrejon died of mesothelioma in 1994. Mr. Torrejon served as commander of various warships, steamships, passenger ships and oil tankers in the 1940s and 1950s. Ms. Torrejon relates that her father was exposed to asbestos fibers in the boiler rooms aboard those ships. According to Ms. Torrejon, she referred her father's case to Ness, Motley, Loadholt Richardson and Poole, P.A., in 1991. Ms. Torrejon relates that she and her father entered into a contract of representation and agreed to settlement terms with Ness Motley in February 1992. Pursuant to the agreement, a videotaped deposition of Mr. Torrejon was taken to perpetuate his testimony. However, Ms. Torrejon says she had never authorized Ness Motley to accept payment on her behalf by check made payable to the firm. Ness Motley was changed to Motley Rice in 2002 after several partners decamped to start their own legal practice. Ms. Torrejon asserts that Motley Rice should be held liable for, among others, failing to disclose, suppressing, misleading or conspiring with any entity to suppress or mislead any facts or information about asbestos in connection with the handling and settlement of asbestos personal injury and wrongful death claims. Ms. Torrejon did not disclose whether her father's estate has entered into agreements to resolve asbestos-related claims, or the terms of those agreements. The Honorable Judith Fitzgerald denied a separate request by Ms. Torrejon for a temporary restraining order inasmuch as it was not properly filed. Motley Rice Objection Ron Motley, Joseph F. Rice and Motley Rice, LLC, contend that it is unclear what Diana L. Torrejon wants to accomplish in her Motion to Intervene. If Ms. Torrejon seeks to represent her individual interest and obtain a stipulation that Motley Rice does not represent her in Owens Corning's case, or for that matter, any case, then there is no dispute to resolve, David B. Wheeler, Esq., at Moore & Van Allen PLLC, in Charleston, South Carolina, tells Judge Fitzgerald. Mr. Wheeler notes that Motley Rice has expressly stated on numerous occasions that it is not Ms. Torrejon's legal counsel. Copies of the correspondence date back to April 2002, Mr. Wheeler says. To the extent Ms. Torrejon seeks a ruling that she has the authority to act on behalf of the estate of her father, Joseph T. Torrejon, that argument is erroneous, Mr. Wheeler asserts. Mr. Wheeler explains that on January 22, 2004, Motley Rice mailed a power of attorney form in connection with a pending asbestos bankruptcy case to Ms. Torrejon, her siblings, and Christina Torrejon, the statutory trustee or personal representative of the Estate. Ms. Torrejon returned the executed power of attorney; however, Motley Rice sent this power of attorney to the Torrejon children in error. Ms. Torrejon forwarded a letter to Mr. Rice in October 2005, raising certain accusations against Motley Rice and asserting that she, as "Sole Principal" after her father's demise, does not grant Mr. Rice a general power of attorney, or authority to vote or act on her behalf, or on behalf of her father. In his response, Mr. Rice acknowledged that the power of attorney previously sent her was sent in error. He also advised Ms. Torrejon that firm records indicate the presence of a representation agreement with Christina Torrejon as the Estate's representative. The firm also contacted Christina Torrejon to advise that it would be dealing solely with her with respect to any future claims for the Estate. Mr. Wheeler also points out that Arizona law does not support Ms. Torrejon's position that she has authority to act on behalf of her father's estate. Section 14-3203 of the Arizona Revised Statutes clearly sets forth the priority schedule for determining who the personal representative of an estate will be and the surviving spouse's priority over a surviving child. To the extent Ms. Torrejon takes issue with Motley Rice and the legal services it has provided, the Bankruptcy Court is not the proper forum for considering those complaints, Mr. Wheeler reminds Judge Fitzgerald. He relates that in 2004, Ms. Torrejon filed an objection to a proposed settlement of Travelers Insurance Company's liability in In re Johns-Manville, Case No. 82-11656. The objection contained arguments similar to that found in the Motion to Intervene. Judge Lifland denied Ms. Torrejon's objection pointing out that "you may have a grievance but this is not the tribunal that is prepared or can address that grievance." 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. (Owens Corning Bankruptcy News, Issue No. 140 and 143; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) PEABODY ENERGY: S&P Rates $900 Mil. Senior Unsecured Notes at BB ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' debt rating to Peabody Energy Corp.'s (BB/Stable/--) $900 million of senior unsecured notes consisting of a $650 million 10-year note and a $250 million 20-year note. The notes will share equally with the company's credit facility and existing senior unsecured notes in the subsidiary guarantees. Proceeds from the notes offering along with the recently completed bank facility will be utilized to fund the acquisition of Excel Coal Ltd. Pro forma for the transaction, Peabody will have approximately $3.2 billion of book debt. "The ratings on Peabody reflect its aggressive financial leverage, including significant debt-like liabilities, ongoing cost pressures, and challenges posed by the inherent risks of coal mining," said Standard & Poor's credit analyst Thomas Watters. "The ratings also reflect the company's leading market position, its substantial and diversified reserve base, and currently favorable coal industry conditions." Ratings List Peabody Energy Corp. Corporate Credit Rating BB/Stable/-- New Rating $650 million sr. unsecured note due 2016 BB $250 million sr. unsecured note due 2026 BB PROTECTION ONE: Fitch Withdraws Junk Rating on Sr. Sub. Debt ------------------------------------------------------------ Fitch Ratings has affirmed and simultaneously withdrawn these ratings for Protection One Alarm Monitoring Inc.: -- Issuer Default Rating (IDR) 'B-'; -- Senior Secured Term Loan 'B+/RR2'; -- Senior Subordinated Debt 'CCC+/RR5'. All debt ratings for this issuer are also withdrawn at this time. Fitch will no longer provide rating coverage of Protection One. Headquartered in Wichita, Kansas, Protection One -- http://www.protectionone.com/-- provides installation, maintenance and monitoring of these state-of-the-art, user- friendly fire and burglar alarm systems. Network Multifamily, the company's wholly owned subsidiary, is the largest and oldest monitored security provider to the multifamily housing market. Protection One's 2,300 professionals serve its customers from more than 64 branch offices and three state-of-the-art monitoring facilities. RAFAELLA APPAREL: 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. and Canadian Retail sector, the rating agency confirmed its B1 Corporate Family Rating for Rafaella Apparel Group, Inc., and its B2 rating on the company's Senior secured bonds. Additionally, Moody's assigned an LGD4 rating to those bonds, suggesting bondholders will experience a 60% 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%). Rafaella designs and markets women's casual and career apparel, primarily tops, skirts, pants, and jackets. The company concentrates on these basic products, which have less fashion risk, and are sold to department stores and specialty stores, off-price channels, and mid-tier national chains. RAINBOW NAT'L: Dolan Family's Offer Cues Moody's to Review Ratings ------------------------------------------------------------------ Moody's Investors Service placed all ratings for Cablevision Systems Corporation, CSC Holdings, Inc., a wholly owned subsidiary of CVC, and Rainbow National Services LLC on review for downgrade following the Dolan family's announcement of a proposal to acquire Cablevision. In Moody's view, under the proposed transaction, Cablevision's credit metrics would deteriorate meaningfully as debt of the cable operations would increase to approximately 11 times EBITDA from 7 times range. Moody's also notes that the company has to balance pro forma transaction higher interest burden with a continuing need to invest in the cable operations given increasingly competitive environment. In Moody's view, Rainbow's event risk would increase as a result of the transaction, given increased financial burden on the parent company. These Ratings on Review for Possible Downgrade: On Review for Possible Downgrade: Cablevision Systems Corporation * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3,LGD6, 93% CSC Holdings, Inc. * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba2, LGD2, 21% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD5, 73% Rainbow National Services LLC * Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 * Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 * Senior Secured Bank Credit Facility, Placed on Review for Possible Downgrade, currently Ba1, LGD2, 19% * Senior Subordinated Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3, LGD5, 86% * Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B2, LGD4, 59% Outlook Actions: Cablevision Systems Corporation * Outlook, Changed To Rating Under Review From Stable CSC Holdings, Inc. * Outlook, Changed To Rating Under Review From Stable Rainbow National Services LLC * Outlook, Changed To Rating Under Review From Stable Affirm Cablevision Systems Corporation * Speculative Grade Liquidity Rating SGL-2 Rainbow National Services LLC * Speculative Grade Liquidity Rating SGL-2 Moody's will evaluate the likely effect of the proposed financing, specifically the increase in leverage and the composition of the debt. Moody's estimates debt will increase to approximately 11 times EBITDA pro forma for the transaction and based on estimated LTM to June 30, 2006 EBITDA, from approximately 7 times. In analyzing Cablevision's cable operations, Moody's focuses on the debt currently called Restricted Group debt and the bonds at CVC; cash flow from the consumer and business cable assets services this debt. Headquartered in Bethpage, New York, Cablevision Systems Corporation, is a domestic cable multiple system operator serving more than 3 million subscribers in and around the metropolitan New York area. Rainbow National Services LLC, headquartered in Jericho, New York, supplies television programming to cable television and direct broadcast service providers throughout the United States. REFCO INC: Files Amended Plan and Disclosure Statement in New York ------------------------------------------------------------------ Refco, Inc., and its debtor-affiliates delivered their Amended Plan of Reorganization and accompanying Disclosure Statement to the U.S. Bankruptcy Court for the Southern District of New York on October 6, 2006. Marc Kirschner, the Chapter 11 trustee for Refco Capital Markets, Ltd.; the Official Committee of Unsecured Creditors; and the Additional Committee of Unsecured Creditors are co-proponents of the Amended Plan. The Amended Plan contemplates that on or prior to the Effective Date, the RCM Chapter 11 Case will be converted to a case under subchapter III of Chapter 7 of the Bankruptcy Code, unless the Debtors and the RCM Trustee agree that there is a compelling reason for the RCM Estate to be administered under Chapter 11. In the event of a conversion to Chapter 7, the Plan will constitute a settlement and compromise between the RCM Estate and the Debtors' Estates, on one hand, and among the Estates of the various Debtors and certain creditors, on the other hand, for which approval is sought simultaneously with the confirmation of the Plan. Creditor Recovery Under Amended Plan The Amended Plan separately classifies Claims against and Interests in: * Refco and its 24 affiliates -- Contributing Debtors, * Refco Capital, Markets, Ltd., and * Refco F/X Associates, LLC. Administrative and Priority Tax Claims against the Contributing Debtors, RCM, and FXA are not classified under the Plan. Administrative and Priority Tax Claims will be paid in full in cash. The Amended Plan groups Claims against and Interest in the Contributing Debtors into eight classes: Estimated Estimated Class Description Claim Amount % Recovery ----- ----------- ------------ ---------- 1 Non-Tax Priority Claims $3,000,000 100.0% 2 Other Secured Claims $700,000 100.0% 3 Secured Lender Claims $704,000,000 100.0% 4 Sr Subordinated Note Claims $397,400,000 83.4% 5(a) Contributing Debtors Gen. Unsecured Claims $522,700,000 23.0% 5(b) Related Claims - 0.0% 6 RCM Intercompany Claims - N/A 7 Subordinated Claims - 0.0% 8 Old Equity Interests - 0.0% The Class 3 Secured Lender Claims against the Contributing Debtors will be allowed and paid to the extent provided in the Early Payment Order. RCM will be entitled to an additional Claim if, at the conclusion of the claims reconciliation process: (x) the total Allowed Contributing Debtors General Unsecured Claims are less than $394,000,000; and (y) the Distributions to be made to Holders of Allowed Contributing Debtors General Unsecured Claims would result in a recovery for the Holders in excess of 35% from the sum of the Contributing Debtors Distributive Assets and the Contributing Debtors' portion of the RGL FXCM Distribution. Specifically, RCM will be entitled to an additional Claim equal to the positive difference between $394,000,000 minus the amount of the Allowed Contributing Debtors General Unsecured Claims. The Additional RCM Claim will participate pro rata in all Distributions from Contributing Debtors Distributive Assets and the Contributing Debtors' portion of the RGL FXCM Distribution to Holders of Allowed Contributing Debtors General Unsecured Claims that exceed the 35% recovery threshold. The Additional RCM Claim, however, will not be subject to the 40% limit on Distributions set forth in the Contributing Debtors General Unsecured Claim Distribution. The Amended Plan groups Claims against FXA into seven classes: Estimated Estimated Class Description Claim Amount % Recovery ----- ----------- ------------ ---------- 1 FXA Non-Tax Priority Claims $165,000 100.0% 2 FXA Other Secured Claims $120,000 100.0% 3 FXA Secured Lender Claims $704,000,000 N/A 4 FXA Sr Sub. Note Claims $397,400,000 N/A 5(a) FXA Gen. Unsecured Claims $140,700,000 to $180,700,000 35.0% 5(b) Related Claims - 0.0% 6 FXA Convenience Claims $12,500,000 40.0% 7 FXA Subordinated Claims - 0.0% The Amended Plan provides that Class 5(a) FXA General Unsecured Claims less than or equal to $10,000, or greater than $10,000 but, with respect to which, Holder voluntarily reduces the Claim to $10,000, will be treated as Class 6 FXA Convenience Claims. The aggregate amount of Distributions to Class 6 FXA Convenience Claims is limited to $5,000,000. To the extent that the amount of Class 5(a) FXA General Unsecured Claims electing to receive a Class 6 FXA Convenience Claim causes the aggregate amount to exceed the cap, the Holders of Claims permitted to elect the treatment will be determined by reference to the amount of the Claim, with the Claim in the lowest amount being selected first and the next largest claim being selected thereafter until the cap is reached. The ranges of claims and recoveries for Holders of FXA General Unsecured Claims are subject to material deviations and may be significantly lower due to: (i) alleged administrative expenses incurred in trading activity post-bankruptcy; and (ii) a dispute with a related entity in Japan concerning ownership of a significant portion of FXA cash. FXA has commenced a turnover action against Japan KK to require it to turn certain cash assets over to FXA. The Amended Plan groups RCM Claims into seven classes: Estimated Estimated Class Description Claim Amount % Recovery ----- ----------- ------------ ---------- 1 RCM Non-Tax Priority Claims $90,000 100.0% 2 RCM Other Secured Claims $110,400,000 100.0% 3 RCM FX/Unsecured Claims $985,600,000 37.6% 4 RCM Securities Customer Claims $2,793,800,000 85.4% 5 RCM Leuthold Metals Claims $15,600,000 100.0% 6 Related Claims - 0.0% 7 RCM Subordinated Claims - 0.0% Holders of Allowed Related Claims will be subordinated and will receive no Distribution unless all Holders of Allowed RCM FX/Unsecured Claims, Allowed RCM Securities Customer Claims and Allowed RCM Leuthold Metals Claims have been paid in full. To the extent that a Non-Debtor Affiliate has an Intercompany Claim against RCM, the Claim will be resolved by: (a) the netting of the Claim against any Claim held by the Contributing Debtors or RCM against the Non-Debtor Affiliate; or (b) to the extent that a distribution is made by RCM on account of the Claim, the Contributing Debtors will reimburse RCM for payments from any amounts the Contributing Debtors receive directly or indirectly from any Non-Debtor Affiliate. Holders of Claims under these classes are impaired and entitled to vote on the Amended Plan: -- Class 4 Senior Subordinated Note Claims, Class 5(a) Contributing Debtors General Unsecured Claims, Class 5(b) Related Claims and Class 6 RCM Intercompany Claims, against one or more of the Contributing Debtors; -- Class 4 FXA Senior Subordinated Note Claims, Class 5(a) FXA General Unsecured Claims, Class 5(b) Related Claims, and Class 6 FXA Convenience Claims, against FXA; and -- Class 3 RCM FX/Unsecured Claims, Class 4 RCM Securities Customer Claims, Class 5 Leuthold Metals Claims and Class 6 Related Claims, against RCM. BAWAG Proceeds Allocation On October 5, 2006, the Court approved a partial allocation of the proceeds of a settlement agreement among the Debtors, the Creditors Committee and BAWAG P.S.K. Bank fur Arbeit und Wirtschaft und Osterreichische Postsparkasse Aktiengesellschaft. The BAWAG Allocation Order provides that $100,000,000 of the BAWAG Guaranteed Proceeds was indefeasibly allocated to Refco Group Ltd., LLC, for payment to the Senior Secured Lenders. The consideration given by BAWAG, aside from the $100,000,000 already earmarked for RGL, will be allocated this way: * $150,000,000 will be allocated to the Contributing Debtors for payment to the Holders of Senior Subordinated Note Claims; * $56,250,000 -- plus 100% of up to $150,000,000 in the form of the BAWAG Contingent Payment -- will be allocated to the Contributing Debtors for payment to the Holders of Allowed Contributing Debtors General Unsecured Claims; * $200,000,000 will be allocated to RCM for payment to the Holders of RCM Securities Customer Claims and RCM FX/Unsecured Claims; and * the value of each release granted by BAWAG in favor of each of the Debtors and RCM would be allocated to each of the Debtors and RCM, as applicable, without any resulting transfer of Cash or other Distribution. On September 21, 2006, BAWAG wired $337,500,000 to the Debtors and $337,500,000 to the U.S. government. The Debtors expect to receive $168,700,000 of the amount transferred by BAWAG to the U.S. government prior to confirmation of the Plan. The BAWAG Settlement Agreement provides that: -- any creditor who voluntarily elects to receive any portion of the BAWAG Proceeds must release BAWAG from all claims or actions arising from or related to the Debtors; and -- any portion of the BAWAG Proceeds that would have been allocated to any creditor that elects not to provide the required release must be returned to BAWAG. The Amended Plan provides that Holders of Allowed Claims against the Contributing Debtors and RCM can, if they affirmatively elect, opt out of the BAWAG settlement and thereby return their share of BAWAG Proceeds to BAWAG in lieu of agreeing to release BAWAG from liability. Opting out, however, will significantly reduce the aggregate recoveries to be received by the Creditors under the Plan: Estimated Plan Estimated Plan Recovery With Recovery Minus Creditor Class BAWAG Proceeds BAWAG Proceeds -------------- -------------- -------------- Senior Subordinated Note Claims 83.4% 45.7% Contributing Debtors General Unsecured Claims 23.0% 12.2% RCM Securities Customer Claims 85.4% 80.6% RCM FX/Unsecured Claims 37.6% 30.9% $140,000,000,000 Claim Pile As of September 29, 2006, the Debtors' claims agent, Omni Management Group, LLC, had received approximately 14,000 timely filed proofs of claim in the Debtors' Chapter 11 cases asserting more than $140,000,000,000 in the aggregate, not including claims asserted in unliquidated amounts. The Debtors and their professionals have been engaged in the process of evaluating the proofs of claim to determine whether objections seeking disallowance, reclassification or reduction of certain asserted claims should be filed. The Debtors expect to seek disallowance of approximately $130,000,000,000 of the claims. Administration of Refco Estates The Joint Sub-Committee of the Official Creditors Committees will designate an entity to serve as Plan Administrator for both Reorganized Refco and Reorganized FXA. The Joint Sub-Committee will also select a trustee for the Litigation Trust to be established under the Plan. The Litigation Trust will be structured in a manner that provides for a senior Tranche A and a junior Tranche B. No Distributions of Litigation Trust Interests will be made in respect of Tranche B until Tranche A has been fully and indefeasibly paid. However, Holders of Allowed Old Equity Interests may receive recoveries directly from 10% of the IPO Underwriter Claims Recovery in Tranche A. The Litigation Trust will have an initial five-year term, which may be extended for one or more one-year terms. The Trust may be terminated earlier than its scheduled termination if: -- the Bankruptcy Court has entered a final order closing all of or the last of the Chapter 11 cases and the RCM Chapter 11 case to the extent the RCM Chapter 11 case was converted to Chapter 7; and -- the Litigation Trustee has administered all the Trust assets and performed all other duties required under the Plan. The RCM Trustee will retain his rights, powers and duties necessary to carry out his responsibilities with respect to the RCM Estate. The Court will convene a hearing on October 16, 2006, at 10 a.m., to consider whether the Amended Disclosure Statement contains adequate information within the meaning of Section 1125 of the Bankruptcy Code. Objections, if any, are due by October 9. A blacklined copy of the Debtors' Amended Disclosure Statement is available for free at http://ResearchArchives.com/t/s?132f 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. 44; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) REFCO INC: FXCM Says Disclosure Statement in Silent on Interest --------------------------------------------------------------- Forex Capital Markets, LLC, complains that the Disclosure Statement explaining the Refco, Inc., and its debtor-affiliates' Plan of Reorganization is silent on the Debtors' efforts to sell their 35% membership interest in FXCM and certain of its affiliates. FXCM contends that information concerning the Debtors' plans with regard to the FXCM Interests is part of the information that would enable a hypothetical investor typical of the holders of claims against the Debtors to make an informed judgment about the Plan. FXCM acts as a dealer in over-the-counter spot foreign currency contracts and foreign currency options contracts. FXCM develops and operates Internet-based, proprietary trading systems and platforms for the purpose of engaging in Forex Transactions as a dealer opposite counterparties or customers. FXCM asserts an $8,500,000 prepetition claim against certain Debtors for certain services rendered pursuant to a 2003 Facilities Management Agreement. FXCM also asserts prepetition unliquidated claims for fraud and breach of warranty against certain Debtors and a $473,000 administrative expense claim. FXCM asserts that approval of the Disclosure Statement should be conditioned on the inclusion of a reasonably detailed discussion of the disposition of the FXCM Interests under the Plan as well as who will exercise all corporate governance rights, if any, under applicable documents following the Plan effective date in the event the FXCM Interests are not sold to a third party prior to the Effective Date. FXCM also wants the Debtors to discuss their views regarding the prospects of a sale of the FXCM Interests to a third party and describe actions, if any, that they have taken to market the Interests over the past three months. The Debtors delivered their Amended Plan of Reorganization and accompanying Disclosure Statement to the U.S. Bankruptcy Court for the Southern District of New York on October 6, 2006. The Amended Disclosure Statement remains silent on FXCM's concerns. FXCM tried to purchase those Interests back from the Debtors for $110,000,000. The transaction, however, was successfully blocked by the Official Committee of Unsecured Creditors and Bank of America, N.A., the agent for the Debtors' prepetition senior secured lenders. They argued that the purchase price was too low. FXCM tried to negotiate a bargain with the Objecting Parties to no avail. In July 2006, FXCM commenced an adversary action to recover $1,000,000 that the Debtors failed to return. 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. 44; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SCOTTS MIRACLE-GRO: 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 Ba1 Corporate Family Rating for Scott's Miracle-Gro Company and its Ba2 rating on the Company's $200 million senior subordinated notes. In addition, Moody's assigned an LGD6 rating to notes, suggesting noteholders will experience a 93% 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 Marysville, Ohio, The Scotts Miracle-Gro Company (NYSE: SMG) -- http://www.scotts.com/-- through its wholly owned subsidiary, The Scotts Company LLC, is a marketer of branded consumer products for lawn and garden care, with products for professional horticulture as well. The Company's brands are Scotts(R), Miracle-Gro(R) and Ortho(R) brands are market-leading in their categories, as is the consumer Roundup(R) brand, which is marketed in North America and most of Europe exclusively by Scotts and owned by Monsanto. The Company also owns Smith & Hawken, a leading brand of garden-inspired products that includes pottery, watering equipment, gardening tools, outdoor furniture and live goods, and Morning Song, a leading brand in the wild bird food market. In Europe, the Company's brands include Weedol(R), Pathclear(R), Evergreen(R), Levington(R), Miracle-Gro(R), KB(R), Fertiligene(R) and Substral(R). SIRVA INC: S&P Withdraws Low-B Ratings and Removes Negative Watch ----------------------------------------------------------------- Standard & Poor's Ratings Services has withdrawn its ratings on SIRVA Inc. and its primary operating subsidiary, SIRVA Worldwide Inc. In addition, all ratings are removed from CreditWatch, where they were placed with negative implications on March 15, 2005. "The rating withdrawal reflects our opinion that as a result of SIRVA's continued delay in filing updated financial statements for both 2005 and 2006, and the likelihood that the company will not be a current filer until the second half of 2007, it lacks adequate financial information to properly determine SIRVA's current credit standing and evaluate creditors' risks," said Standard & Poor's credit analyst Michael Scerbo. Ratings List SIRVA Inc. Ratings Withdrawn, Removed From Creditwatch To From Corporate credit rating NR B/Watch Negative/-- SIRVA Worldwide Inc. Corporate credit rating NR B/Watch Negative/-- Senior secured debt NR B/Watch Negative/-- Recovery rating NR 3 SPANSION LLC: S&P Rates New $400 Million Term Loan at B+ -------------------------------------------------------- Standard & Poor's Ratings Services affirmed it 'B' corporate credit rating on Sunnyvale, California-based Spansion Inc. At the same time, Standard & Poor's assigned its 'B+' issue rating, one notch above the corporate credit rating, and its '1' recovery rating to Spansion LLC's new $400 million term loan. The outlook is stable. "The ratings reflect the company's exposure to the aggressively competitive and cyclical 'NOR' flash semiconductor industry, significant capital investment requirements, and a history of periodic material negative free cash flows," said Standard & Poor's credit analyst Bruce Hyman. These factors partly are offset by Spansion's leading market position (which provides some scale advantages), prospects for the development of differentiated technologies, and likely growth in certain served markets. Spansion manufactures NOR flash semiconductors, used in mobile phones, consumer products, automotive electronics, and other devices. The $8 billion NOR market is composed largely of commodity products, and is subject to severe revenue cyclicality, intense price pressure, high capital investment requirements, and periods of negative free cash flows for suppliers. Furthermore, the NOR flash market has a relatively modest expected growth rate. Spansion has been gaining market share through its introduction of differentiated products, which also contributes to revenue and profitability growth. Spansion's NOR market share was recently 31%, vs. principal rival Intel Corp.'s 24%; historically, the companies were tied for leadership. Still, competitors are also introducing differentiated chips, which could, over time, erode Spansion's current leadership position. STMicroelectronics has a 17% share, and Samsung Electronics Co. Ltd. also participate in the market, among others. SPECIALTYCHEM PRODUCTS: Wants to Sell ChemDesign's Assets --------------------------------------------------------- SpecialtyChem Products Corporation and ChemDesign Corporation seek authority from the U.S. Bankruptcy Court for the Eastern District of Wisconsin to sell substantially all of the assets of ChemDesign, free and clear of all liens, claims, encumbrances, at an auction on Oct. 16, 2006. The Debtors also seeks the Court's approval of an asset purchase agreement with LiquiTech Industries, Inc. ChemDesign's assets consist of real estate, machinery and equipment located in Fitchburg, Massachusetts. Marie L. Nienhuis, Esq., at Godfrey & Kahn, S.C., relates that since the Debtors are unable to obtain the use of cash collateral beyond the Oct. 29 specified period, they do not have the financial resources or access to capital necessary to implement a prolonged operational restructuring. Without access to capital, the Debtors will experience difficulty in covering its fixed costs. The Debtors have, therefore, determined to maximize the value of its estate through the sale of assets. Ms. Nienhuis tells the Court that the Debtors, after consultation with Wachovia and Cambridge, have elected to use LiquiTech as the initial bidder on the assets at the auction. The Debtors request that it be allowed to offer the "Stalking Horse Bidder" a break-up fee of $100,000. Ms. Nienhuis also discloses that the Debtors request the Court to schedule the Sale Hearing for Oct. 19, 2006, and request that the Court set Oct. 13, 2006, at 4:00 p.m. as the deadline for filing any objection to the proposed sale of assets. About ChemDesign Corporation Headquartered in Fitchburg, Massachusetts, ChemDesign Corporation -- http://www.chemdesigncorp.com/-- is a custom manufacturer of various fine organic chemicals for paper products, electronics, agricultural products and other materials. The Debtor filed for chapter 11 protection on Aug. 27, 2006 (Bankr. E.D. Wis. Case No. 06-24729. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million and $50 million. About SpecialtyChem Products Headquartered in Marinette, Wisconsin, SpecialtyChem Products, Corp., manufactures various organic chemicals for paper products, electronics, agricultural products and other materials. The company filed for chapter 11 protection on June 12, 2006 (Bankr. E.D. Wis. Case No. 06-23131). Christopher J. Stroebel, Esq., Timothy F. Nixon and Marie L. Nienhuis, Esq., at Godfrey & Kahn, S.C., represent the Debtor in its restructuring efforts. Fort Dearborn Partners, Inc., is the Debtor's turnaround consultant, and gives financial advice to the Debtor. Matthew M. Beier, Esq., and Eliza M. Reyes, Esq., at Brennan, Steil and Basting, S.C., and Matthew T. Gensburg, Esq., and Nancy A. Peterman, Esq., at Greenberg Traurig, L.L.P., represent the Official Committee of Unsecured Creditors of the Debtor. In its schedule of assets and liabilities, the Debtor disclosed $11,394,224 in total assets and $12,323,425 in total debts. SPECTRUM 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 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 Spectrum Brands. Additionally, Moody's revised and 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 B2 B1 LGD2 27% $1.143 billion Term Loan B2 B1 LGD2 27% $700 million Sr. Sub. Notes Caa2 Caa2 LGD5 82% $350 million Sr. Sub. Notes Caa2 Caa2 LGD5 82% 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 Atlanta, Georgia, Spectrum Brands (NYSE: SPC) - - http://www.spectrumbrands.com/-- is a consumer products company and a supplier of batteries and portable lighting, lawn and garden care products, specialty pet supplies, shaving and grooming and personal care products, and household insecticides. Spectrum Brands' products are sold by the world's top 25 retailers and are available in more than one million stores in 120 countries around the world. The company has manufacturing and distribution facilities in China, Australia and New Zealand, and sales offices in Melbourne, Shanghai, and Singapore. STROBER ORGANIZATION: 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. and Canadian Retail sector, the rating agency confirmed its B1 Corporate Family Rating for Strober Organization, Inc., and its B3 ratings on the company's $600 million Gtd. Sr. Sec. Revolver due 2011 and $700 million Gtd. Sr. Sec. Term Loan B due 2013. Additionally, Moody's assigned LGD3 ratings to those loans, suggesting creditors 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%). Strober Organization, Inc., -- http://www.strober.com/-- is a major supplier of high-quality building materials to professional builders and contractors in the northeastern and mid-Atlantic regions of the United States. Strober is part of Pro-Build Holdings, which is a wholly owned subsidiary of Fidelity Capital, the business development arm of the mutual fund company, Fidelity Investments. Pro-Build Holdings, which also includes the Lanoga Corporation within its portfolio, currently operates more than 400 lumber and building product distribution, manufacturing and assembly centers throughout the U.S. STRUCTURED ASSET: S&P Junks Rating on Class B-5 Loan ---------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on class B-5 from Structured Asset Securities Corp. Assistance Loan Trust 2003- AL1 to 'CCC' from 'B'. At the same time, the ratings on the remaining classes from this series and from series 2001-SB1 are affirmed. The downgrade of class B-5 reflects continued erosion of credit support due to adverse collateral pool performance, a high level of serious delinquencies (90-plus days, foreclosure, and REO), and high cumulative losses. The current credit support for this class is 3.33%, down from 5.05% at issuance. The affirmations reflect actual and projected credit support percentages that adequately support the current ratings. These transactions benefit from credit enhancement provided by subordination. Rating Lowered Structured Asset Securities Corp. Assistance Loan Trust 2003-AL1 Rating ------ Class To From ----- -- ---- B-5 CCC B Ratings Affirmed Structured Asset Securities Corp. Assistance Loan Trust 2003-AL1 Class Rating ----- ------ A, APO, AIO AAA B-1 AA B-2 A B-3 BBB B-4 BB Structured Asset Securities Corp. 2001-SB1 Class Rating ----- ------ A2, A4, A5, APO, AIO AAA B-1 AA B-2 A B-3 BBB TODD MCFARLANE: Files Amended Liquidation Plan in Arizona --------------------------------------------------------- Todd McFarlane Productions Inc. delivered to the U.S. Bankruptcy Court for the District of Arizona in Phoenix an amended plan of liquidation and an accompanying disclosure statement explaining that plan. Under the Amended Plan, holders of secured claims will receive single payment of $200,000 while holders of other priority claims will receive cash equal to the unpaid portion of their allowed claim. The claims of Tony Twist and Neil Gaiman are entitled to their pro rata share of the available cash and the proceeds of the insurance securing their Claims. Class 5 General Unsecured Claims will receive pro rata share of the available cash, provided however that in the event one or more holders of general unsecured claims entitled to submit votes to accept the plan actually submit timely and unqualified votes to accept the Plan, all distributions otherwise payable to the general unsecured claims held by the Debtor's affiliate and the Debtor's indemnity claims will be paid ratably to the approving creditors then holding allowed claims. Holders of interests in the Debtor will not receive any distributions under the Plan on account of their interests until all claims in the prior classes have been paid in full. A full-text blacklined version of the Debtor's amended liquidation plan is available for a fee at: http://www.researcharchives.com/bin/download?id=061010214730 Headquartered in Tempe, Arizona, Todd McFarlane Productions, Inc. -- http://www.spawn.com/-- publishes comic books including Spawn, Hellspawn, and Sam and Twitch. The Company filed for chapter 11 protection on Dec. 17, 2004 (Bankr. D. Ariz. Case No. 04-21755). Josefina F. McEvoy, Esq., and Kelly Singer, Esq., at Squire Sanders & Dempsey, LLP, represent the Debtor in its restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in the Debtor's case. When the Company filed for protection from its creditors, it listed more than $10 million in assets and more than $50 million in debts. TODD MCFARLANE: Disclosure Statement Hearing Slated for November 9 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Arizona in Phoenix will convene a hearing to consider the adequacy of Todd McFarlane Productions Inc.'s amended disclosure statement explaining its amended plan of liquidation on Nov. 9. 2006, 11:00 am, at Courtroom 601, U.S. Bankruptcy Court, No. 230 North First Avenue, in Phoenix, Arizona. A hearing on the confirmation of the Plan will be held in the same venue at 11:00 a.m. on Jan. 4, 2007. Headquartered in Tempe, Arizona, Todd McFarlane Productions, Inc. -- http://www.spawn.com/-- publishes comic books including Spawn, Hellspawn, and Sam and Twitch. The Company filed for chapter 11 protection on Dec. 17, 2004 (Bankr. D. Ariz. Case No. 04-21755). Josefina F. McEvoy, Esq., and Kelly Singer, Esq., at Squire Sanders & Dempsey, LLP, represent the Debtor in its restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in the Debtor's case. When the Company filed for protection from its creditors, it listed more than $10 million in assets and more than $50 million in debts. TOWER RECORDS: Court Approves Retention of FTI Palladium -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave MTS Incorporated, dba Tower Records, and its debtor-affiliates' permission to employ FTI Palladium Partners, nunc pro tunc to Aug. 20, 2006. The Debtors say that FTI Palladium will provide the Debtors with an officer and temporary employees. The Debtors told the Court that it appointed Joseph L. D'Amico as chief executive officer of the Debtor and its debtor-affiliates. The Debtors also appointed Jon Orr and Lisa Poulin as temporary employees. Mr. D'amico is expected to assist in the direction and management of the Debtors' daily restructuring efforts, including negotiating with parties-in-interest and coordinating the "work group" of professionals that assist the Debtors. The Debtors told the Court that the temporary employees are expected to: a) assist with the management of the Debtors' financial and treasury functions; b) develop and implement case management strategies, tactics and processes; c) negotiate the Debtors' debtor in possession financing; d) prepare employees of the Debtors for these chapter 11 cases; e) work with professionals involved in the cash management process; f) supervise: i) the preparation of certain reports required by this Court and the Debtors' schedules and statements and ii) the management of the claims reconciliation process and the reclamation process; g) provide testimony before this Court, if needed, on matters that are within FTI's areas expertise; and h) render such other assistance or administrative support as Debtors' management or counsel may deem: i) necessary as part of the post-petition reorganization process; ii) consistent with the role of crisis manager; and iii) not duplicative of services provided by other professionals in this proceeding. The Debtor discloses that it has paid the firm a $200,000 retainer. To the best of the Debtors knowledge, the firm is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. 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 its affiliates previously filed for chapter 11 protection on Feb. 9, 2004 (Bankr. D. Del. Lead Case No. 04-10394). The Court confirmed the Debtors' plan on March 15, 2004. The Company and seven of its affiliates filed their second voluntary chapter 11 petition 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. TTM TECH: S&P Rates Proposed $240 Mil. Senior Facilities at BB- --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to Santa Ana, California-based TTM Technologies Inc., a printed circuit board manufacturer. The outlook is negative. At the same time, S&P assigned its 'BB-' bank loan rating and '2' recovery rating to the company's proposed $240 million of first- lien senior secured facilities, indicating that lenders can expect substantial (80%-100%) recovery of principal in the event of payment default. All ratings are based on preliminary offering statements and are subject to review upon final documentation. Proceeds of the term loan portion of the facilities will be used to fund the company's $225 million acquisition of the printed circuit board businesses from Tyco International Ltd. (BBB+/WatchNeg/A-2). "The ratings reflect the company's solid market position in the U.S.-based printed circuit board industry and its vulnerability to operating cyclicality and integration challenges, which is offset by light leverage and prospects for deleveraging," said Standard & Poor's credit analyst Lucy Patricola. The company's secure market position, along with light leverage, provide ratings support. The rating could be lowered if the integration of the two businesses does not proceed as planned, resulting in service disruptions and customer defections. The outlook could be revised to stable if the integration is executed smoothly and profitability expectations are realized. UNIVERSAL EXPRESS: Buying New Jersey Gasoline Assets for $42 Mil. ----------------------------------------------------------------- Universal Express Inc. signed a formal contract to purchase the assets of a New Jersey-based gasoline and oil operator. This wholesaler owns and operates in excess of 38 retail gasoline and diesel oil stations. "In addition to the obvious positive impact on our balance sheet," said Richard A. Altomare, President and CEO of Universal Express, "this acquisition keys nicely with our transportation logistics model. Virtually every facet of our businesses relies on the price, availability and delivery of fuel, whether it is our luggage division, our trucking component, our aviation company, or our courier network. It is my hope that we can affect a reconfigured and even better business model and possible re- branding for these stations in the years to come." "The $42 Million agreement calls for the retention of current management and payment over a 14 month period," continued Mr. Altomare. "In addition to the symbiosis that this company has with our core businesses and additional retail distribution, our growing nationwide presence is both complimented and augmented through this initial oil and gas acquisition" continued Mr. Altomare. The estimated 5% earnings of this company, we believe, through our management and economy of scale can be increased. Our corporate awareness is as real and as valuable to us as our many strategic partners, our loyal employees, and our steadfast vision of a changing transportation logistical industry. That awareness will also be enhanced by these 38 visible and retail locations which may in the future become multi-utilized" "The certified financial accounting firm has been ordered and future name changes are planned by Universal Express," added General Counsel, Chris Gunderson. "Certainly, all of the obvious benefits of increased cash flow, extra revenues, enhanced balance sheet, inter-company synergies and continued corporate growth can be addressed; however, I contend that the addition of the first oil and gas company matures this conglomerate in many other ways." "Increased corporate capitalization and possible restructuring is definitely under consideration, as we entertain all of our future options," concluded Mr. Altomare. Universal Express, Inc., -- http://www.usxp.com/ -- is a logistics and transportation conglomerate with multiple developing subsidiaries and services. Its principal subsidiaries include Universal Express Capital Corp. and Universal Express Logistics, Inc. (which includes Virtual Bellhop, LLC, Luggage Express and Worldpost, its international shipping divisions), and Private Postal Center Network.com and its division Postal Business Center Network.com. Going Concern Doubt Pollard-Kelley Auditing Services, Inc., Fairlawn, Ohio, expressed substantial doubt about Universal Express, Inc.'s ability to continue as a going concern after it audited the Company's financial statements for the fiscal year ended June 30, 2006. The auditing firm points to the Company's generated losses to date. USA COMMERCIAL: Disclosure Statement Hearing Scheduled on Nov. 13 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Nevada will convene a hearing at 9:30 a.m., on Nov. 13, 2006, to consider the adequacy of the disclosure statement explaining USA Commercial Mortgage Company and its debtor-affiliates' Joint Plan of Reorganization. The hearing will be held at the Foley Federal Building, 300 Las Vegas Boulevard South, Third Floor, in Las Vegas, Nevada. The Debtors' Joint Plan effectuates a sale of certain assets of Debtors USA Commercial Mortgage Company (USACM) and USA Capital First Trust Deed, LLC, puts in place a mechanism for maximizing the recovery on other assets and claims held by the Debtors, provides for the ongoing servicing and collection of the loans of direct lenders, and provides for an equitable distribution of the proceeds of the Debtors' assets to creditors and fund members. Under the Debtors' Plan, each holder of an Allowed Secured Claim will receive, at the option of the relevant Debtor, in full satisfaction, settlement, release and discharge of and in exchange for their claim, either: a) cash from the Distribution Account of the relevant Debtor equal to the present value of the unpaid portion of their secured claim; b) the return of the collateral securing the allowed secured claim; or c) any other treatment agreed upon by the relevant Debtor and secured claim holder. Holders of Allowed General Unsecured Claim in will receive their Pro Rata share of all cash available for distribution, at the sole discretion of USACM or the USACM Estate Administrator, from the USACM Distribution Account up to the full amount of the claim after payment of USACM's Liquidation Expenses, Allowed Secured Claims, Allowed Administrative Expense Claims, Allowed Priority Tax Claims, and Allowed Priority Non-Tax Claims in accordance with the Plan and the provisions of the Bankruptcy Code. A copy of the Debtors' Joint Plan of Reorganization is available for free at http://researcharchives.com/t/s?132d A copy of the Disclosure Statement explaining the Joint Plan is available for free at http://researcharchives.com/t/s?132e About USA Commercial Based in Las Vegas, Nevada, USA Commercial Mortgage Company, dba USA Capital -- http://www.usacapitalcorp.com/-- provides more than $1 billion in short-term and permanent financing to homebuilders, commercial developers, apartment owners and institutions nationwide. The Company and its debtor-affiliates filed for chapter 11 protection on April 13, 2006 (Bankr. D. Nev. Case Nos. 06-10725 to 06-10729). Lenard E. Schwartzer, Esq., at Schwartzer & Mcpherson Law Firm, and Annette W. Jarvis, Esq., at Ray Quinney & Nebeker, P.C., represent the Debtors in their restructuring efforts. Thomas J. Allison, a senior managing director at Mesirow Financial Interim Management LLC, has been employed as Chief Restructuring Officer for the Debtors. Susan M. Freeman, Esq., and Rob Charles, Esq., at Lewis and Roca LLP represent the Official Committee of Unsecured Creditors of USA Commercial Mortgage Company. Edward M. Burr at Sierra Consulting Group, LLC, gives financial advice to the Creditors Committee of USA Mortgage. Marc A. Levinson, Esq., and Jeffery D. Hermann, Esq., at Orrick, Herrington & Sutcliffe LLP, and Bob L. Olson, Esq., and Anne M. Loraditch, Esq., at Beckley Singleton, Chartered, represent the Official Committee of Equity Security Holders of USA Capital Diversified Trust Deed Fund, LLC. FTI Consulting, Inc., gives financial advice to the Equity Committee of USA Diversified. Candace C. Carlyon, Esq., and Shawn w. Miller, Esq., at Shea & Carlyon, Ltd., and Jeffrey H. Davidson, Esq., Frank A. Merola, Esq., and Eve H. Karasik, Esq., at Stutman, Treister & Glatt, PC, represent the Official Committee of Equity Security Holders of USA Capital First Trust Deed Fund, LLC. Matthew A. Kvarda, at Alvarez & Marsal, LLC, gives financial advise to the Equity Committee of USA First. When the Debtors filed for protection from their creditors, they estimated assets of more than $100 million and debts between $10 million and $50 million. USA COMMERCIAL: Exclusive Solicitation Period Intact Until Oct. 19 ------------------------------------------------------------------ USA Commercial Mortgage Company and its debtor-affiliates' exclusive period to solicit acceptances for their Joint Plan of Reorganization remain intact until at least Oct. 19, 2006, or until the U.S. Bankruptcy Court for the District of Nevada issues a decision on their motion to extend their solicitation period for another 180 days. The Debtors are asking the Court to give them another 180 days, or until Dec. 31, 2006, to solicit acceptances for their Joint Plan. The Court will convene a hearing on Oct. 19 to consider the requested extension. According to the Debtors, a short continuance of exclusivity would provide them with more time to prepare a joint plan in consultation with the four official committees appointed in their cases -- the Official Committee of Equity Security Holders of USA Capital First Trust Deed Fund, LLC, the Official Committee of Executory Contract Holders of USA Commercial Mortgage Company, the Official Committee of Equity Security Holders of USA Capital Diversified Trust Deed Fund, LLC, and the Official Committee of Unsecured Creditors for USA Commercial Mortgage Company. Annette W. Jarvis, Esq., at Ray Quinney & Nebeker PC, tells the Court that the extension is warranted because: a) the Debtors are not using exclusivity to force creditors to accept anything; b) the Debtor is not delaying filing a plan except to consummate negotiations with the Committees; c) there is no allegation of mismanagement by the Debtors' current management; and d) there is no problem between Debtors' principals delaying a plan. About USA Commercial Based in Las Vegas, Nevada, USA Commercial Mortgage Company, dba USA Capital -- http://www.usacapitalcorp.com/-- provides more than $1 billion in short-term and permanent financing to homebuilders, commercial developers, apartment owners and institutions nationwide. The Company and its debtor-affiliates filed for chapter 11 protection on April 13, 2006 (Bankr. D. Nev. Case Nos. 06-10725 to 06-10729). Lenard E. Schwartzer, Esq., at Schwartzer & Mcpherson Law Firm, and Annette W. Jarvis, Esq., at Ray Quinney & Nebeker, P.C., represent the Debtors in their restructuring efforts. Thomas J. Allison, a senior managing director at Mesirow Financial Interim Management LLC, has been employed as Chief Restructuring Officer for the Debtors. Susan M. Freeman, Esq., and Rob Charles, Esq., at Lewis and Roca LLP represent the Official Committee of Unsecured Creditors of USA Commercial Mortgage Company. Edward M. Burr at Sierra Consulting Group, LLC, gives financial advice to the Creditors Committee of USA Mortgage. Marc A. Levinson, Esq., and Jeffery D. Hermann, Esq., at Orrick, Herrington & Sutcliffe LLP, and Bob L. Olson, Esq., and Anne M. Loraditch, Esq., at Beckley Singleton, Chartered, represent the Official Committee of Equity Security Holders of USA Capital Diversified Trust Deed Fund, LLC. FTI Consulting, Inc., gives financial advice to the Equity Committee of USA Diversified. Candace C. Carlyon, Esq., and Shawn w. Miller, Esq., at Shea & Carlyon, Ltd., and Jeffrey H. Davidson, Esq., Frank A. Merola, Esq., and Eve H. Karasik, Esq., at Stutman, Treister & Glatt, PC, represent the Official Committee of Equity Security Holders of USA Capital First Trust Deed Fund, LLC. Matthew A. Kvarda, at Alvarez & Marsal, LLC, gives financial advise to the Equity Committee of USA First. When the Debtors filed for protection from their creditors, they estimated assets of more than $100 million and debts between $10 million and $50 million. VERIDICOM INT'L: June 30 Stockholders' Deficit Widens to $4.3 Mil. ------------------------------------------------------------------ Veridicom International, Inc., filed its financial statements for the second quarter ended June 30, 2006, with the Securities and Exchange Commission on Sept. 22, 2006. For the three months ended June 30, 2006, the Company reported a comprehensive net loss of $2,087,758 on $32,632 of revenues compared with a comprehensive net loss of $1,839,731 on $128,231 of revenues for the same period in 2005. At June 30, 2006, the Company's balance sheet showed $4,338,961 in total assets, $8,685,452 in total liabilities, and $45,253 in minority interest, resulting in a $4,391,744 stockholders' deficit. The Company had a $1,538,875 deficit at Dec. 31, 2005. The Company's June 30 balance sheet also showed strained liquidity with $886,871 in total current assets available to pay $8,676,786 in total current liabilities coming due within the next 12 months. Full-text copies of the Company's second quarter financials are available for free at http://ResearchArchives.com/t/s?132b Going Concern Doubt Manning Elliot LLP, in Vancouver, Canada, raised substantial doubt about Veridicom International's ability to continue as a going concern after auditing the company's amended financial statements for the year ended Dec. 31, 2005. The Firm pointed to the company's recurring losses from operations and working capital deficiency. About Veridicom International headquartered in Vancouver, British Columbia, Veridicom International, Inc. -- http://www.veridicom.com/-- designs, develops, manufactures, and sells capacitive fingerprint sensors, computer peripherals, and software related to the use of its fingerprint authentication technology. The Company has five subsidiaries: EssTec Inc., Veridicom Pakistan (Private) Limited, Veridicom Inc., Cavio Corporation, and Veridicom International (Canada) Inc. VTEX ENERGY: July 31 Working Capital Deficit Tops $10 Million ------------------------------------------------------------- VTEX Energy, Inc., filed its first quarter financial statements with the Securities and Exchange Commission on Oct. 5, 2006. The Company incurred a $1.3 million net loss on $1,232 of net revenues for the three months ended July 31, 2006, compared to a $2 million net loss on $199,714 of net revenues in 2005. The Company's July 31 balance sheet also showed strained liquidity with $835,341 in total current assets available to pay $10.8 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?132a Going Concern Doubt Malone & Bailey, PC, expressed substantial doubt about VTEX Energy, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the fiscal year ended April 30, 2006. The auditing firm pointed to the Company's significant loss from operations in the current year, working capital deficit and default on certain debt instruments. VTEX Energy, Inc. -- http://www.vtexenergy.com/-- explores for and produces oil and gas primarily in Louisiana and Texas. The company focuses on low-risk drilling developments, recompletions, and workovers, and has estimated proved preserves of 103,000 barrels of crude oil and 9.4 billion cu. ft. of natural gas. WESTERN APARTMENT: Rowell to Craft Traffic Assessment Report ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Hawaii gave Western Apartment Supply & Maintenance Company, permission to employ Phillip Rowell and Associates for a traffic assessment report. The Debtor seeks the expertise of the firm to prepare traffic assessment report in connection to a community plan amendment and special management area permit, which Maui Oceanfront Inn & Sarento's on the Beach Restaurant is located. The firm is expected to: a) site reconnaissance and date collection; b) evaluate traffic conditions; c) describe project-related traffic characteristics; and d) prepare reports. The firm's professionals standard hourly rates are: Designation Hourly Rate ----------- ----------- Principal traffic engineer $100 Clerical support $25 Technical support $50 Phillip J. Rowell, a principal of the firm, assured the Court that his firm is a "disinterested person", as that term defined in Section 101(14) of the Bankruptcy Code. Based in San Diego, California, Western Apartment Supply & Maintenance previously filed for chapter 11 protection on Jan. 12, 2004 (Bankr. D. Hawaii Case NO. 04-00072). The case was dismissed on May 16, 2006. The Debtor filed its second chapter 11 petition on Apr. 18, 2006 (Bankr. S.D. Calif. Case No. 06-00821). John L. Smaha, Esq., at Smaha and Daley, represents the Debtor. When the Debtor filed for chapter 22, it listed total assets of $18,045,054 and total debts of $18,131,069. On June 30, 2006, at the request La Jolla Loans Inc., a secured creditor, the U.S. Bankruptcy Court for the Southern District of California transferred the Debtor's case to the U.S. Bankruptcy Court for the District of Hawaii on July 1, 2006 (Bankr. D. Hawaii Case No. 06-00459). WESTERN APARTMENT: Gets Court Okay to Hire Scientific Consultant ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Hawaii gave Western Apartment Supply & Maintenance Company, permission to employ Scientific Consultant Services, Inc., to provide archeological services relating to a cultural impact assessment of the proposed paving of the parking lot for the Maui Oceanfront Inn & Sarento's on the Beach Restaurant. Specifically, Scientific Consultant is expected to: a) archive research, focusing on traditions and legends; b) limit historic research; c) review previous oral histories conducted in the general project area; d) search persons knowledgeable of the project area and significant sites, places, persons or myths associated with the area; e) interview with identified informants; and f) produce report detailing the findings the findings, including transactions of interview statements. The Debtor told the Court that the firm will charge between $5,360 and $7,760 for its services. Michael Dega, senior archeologist of the firm, assured the Court that his firm is a "disinterested person", as that term defined in Section 101(14) of the Bankruptcy Code. Based in San Diego, California, Western Apartment Supply & Maintenance owns a 73-room hotel in Maui, Hawaii known as the Best Western Maui Oceanfront Inn. The Company filed for chapter 11 protection on Jan. 12, 2004 (Bankr. D. Hawaii Case NO. 04-00072). That case was dismissed on May 16, 2006. The Debtor filed its second chapter 11 petition on Apr. 18, 2006 (Bankr. S.D. Calif. Case No. 06-00821). Gustavo E. Bravo, Esq., and John L. Smaha, Esq., at Smaha and Daley, represent the Debtor. When the Debtor filed for chapter 22, it listed total assets of $18,045,054 and total debts of $18,131,069. On June 30, 2006, at the request La Jolla Loans Inc., a secured creditor, the U.S. Bankruptcy Court for the Southern District of California transferred the Debtor's case to the U.S. Bankruptcy Court for the District of Hawaii on July 1, 2006 (Bankr. D. Hawaii Case No. 06-00459). No Official Committee of Unsecured Creditors has been appointed in the Debtor's bankruptcy proceedings. WHITE RIVER: Court Okays Marvin R. Moore as Mining Engineer ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Indiana gave White River Coal, Inc. and its debtor-affiliates permission to employ Marvin R. Moore, as their mining engineer. Mr. Moore is expected to: a) provide consulting services as chief mining engineer to the Debtors; b) report to the president and mine managers; c) oversee and organize all engineering, including, but not limited to, underground time studies, and environmental issues, dealing with MSHA, INDR, OSM, regarding refuse and prep plant; and d) serve the Debtors, subsidiary of the Debtor as the Debtors may from time to time require, consulting capacity as an independent contractor as may from time to time be determined by the Debtors. In addition, Mr. Moore shall be responsible for: * the payment of income taxes as will be required by any governmental entity with respect to compensation paid by the Debtor to Mr. Moore; * maintain proper financial records of the consultant, which records will detail, amongst other things, expenses incurred on behalf of the Debtors; and * obtain all necessary licenses and permits and for complying with all applicable federal, state and municipal laws, codes and regulations in connections with the provision of services hereunder and the consultant shall, when requested, provide the Debtors with adequate evidence of the compliance with this paragraph. The Debtors have agreed to pay Mr. Moore $70 per hour for this engagement. To the best of the Debtors knowledge, Mr. Moore does not hold any interest adverse to their estate and is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. Based in Hazleton, Indiana, White River Coal, Inc., operates a mining company. The Company and its affiliates filed for chapter 11 protection on May 22, 2006 (Bankr. S.D. Ind. Case Nos. 06-70375 through 06-70379). C.R. Bowles, Jr., Esq., at Greenbaum Doll & McDonald PLLC, represents the Debtors in their restructuring efforts. When the Debtor filed for protection from their creditors, they listed assets totaling $2 million and debts totaling $35 million. WHITE RIVER: Wants to Expand Realization Advisor's Duties --------------------------------------------------------- White River Coal, Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Indiana, for permission to expand the scope of responsibilities of Realization Advisors, Inc., as their bankruptcy restructuring officer. The Debtors require the firm to provide strategic management and financial services, and crisis management services previously provided by Bronco Energy Inc., the non-debtor ultimate parent of the Debtors. As reported on the Troubled Company Reporter on Oct. 4, 2006, Realization Advisors tasks were to: a) assist in developing a short-term financial model, including projections and financial forecasts, on a cash-flow basis, to facilitate continuing operations of the Debtors' mine, cost reductions, creditor negotiations, and expedite decision making; b) facilitate further cost cutting, cash management and controls, materials and labor management, accounts receivable management and collection, employee and management evaluation, and claims and creditor management efforts to improve short-term results; c) aid in negotiating and facilitating a forbearance arrangement, adequate protection arrangements, and debtor-in-possession financing with the Debtors' lenders in order to preserve value, insure continued operations, and allow for all business alternatives to be properly evaluated; d) assist management with cash flow and liquidity management to sustain business viability, including management of cash disbursements; e) develop and assess alternative business and asset disposition strategies; f) develop a "critical path" timeline for continuing business and sale efforts; g) assist in the evaluation, development and implementation of any employee retention and incentive plan; h) facilitate valuations on a sale, liquidation and going- concern basis; i) supervise, lead, direct, and facilitate aggressive sale efforts of the business and its assets to maximize recovery, including management of the entire sale process, preparation of offering materials, leading active, solicitation of interested acquirors, due diligence, and competitive bidding; j) supervise and direct, with management, communication with lenders, lessors, creditors, stakeholders, and other parties-in-interest; k) assist and advise in the evaluation of executory contracts and leases, including renegotiation and restructuring of supply contracts; l) provide testimony regarding all of the foregoing, and collateral value and adequate protection of the lenders' collateral, as needed; m) assist counsel and direct the evaluation, prosecution, and negotiation of potential litigation arising from or related to the acquisition of the Debtors' assets; and n) provide additional financial advisory services to assist the Debtors and their operations, including but not limited to bankruptcy planning and reorganization services, development of a plan of reorganization, documentation and testimony supporting the feasibility and approval of the plan, and post-approval wind-down an implementation. The Debtors disclosed that Michael L. Kayman, Esq., a principal of the firm, will receive $35,000 per month for this engagement. Mr. Kayman will also receive a non-refundable retainer of $35,000 at the end of his tenure as chief restructuring officer. Mr. Kayman assured the Court that his firm does not hold any interest adverse to the Debtors' estate and is a "disinterested person" as that term defined in Section 101(14) of the Bankruptcy Code. Based in Hazleton, Indiana, White River Coal, Inc., operates a mining company. The Company and its affiliates filed for chapter 11 protection on May 22, 2006 (Bankr. S.D. Ind. Case Nos. 06-70375 through 06-70379). C.R. Bowles, Jr., Esq., at Greenbaum Doll & McDonald PLLC, represents the Debtors in their restructuring efforts. When the Debtor filed for protection from their creditors, they listed assets totaling $2 million and debts totaling $35 million. WINN-DIXIE: Major Creditors Approve Reorganization Plan ------------------------------------------------------- Winn-Dixie Stores, Inc., and 23 of its debtor-affiliates inform the U.S. Bankruptcy Court for the Middle District of Florida that their major creditor groups voted in favor of their Joint Plan of Reorganization. According to Kathleen M. Logan, president of the Debtors' voting tabulation agent Logan & Company, Inc., majority of the holders of claims in these Classes have accepted the Plan. Class 7 - AmSouth Bank Collateralized Letter of Credit Claim Class 8 - Thrivent Lutheran Leasehold Mortgage Claim Class 9 - NCR Purchase Money Security Interest Claim Class 12 - Noteholder Claims Class 13 - Landlord Claims Class 14 - Vendor/Supplier Claims Class 15 - Retirement Plan Claims Class 16 - Other Unsecured Claims Class 17 - Small Claims Based on results of the tabulation of the properly executed and timely ballots, the Classes accepted the Plan in these percentages: Percentage Percentage Accepting Class Accepting Excluding Insiders ----- -------------------------------------------------- No. Holders Amt. Held No. Holders Amt. Held ----------- --------- ----------- --------- 7 100% 100% 100% 100% 8 100% 100% 100% 100% 9 100% 100% 100% 100% 12 98.19% 99.46% 98.19% 99.46% 13 76.96% 80.47% 76.96% 80.47% 14 92.82% 96.74% 92.82% 96.74% 15 96.20% 97.46% 96.05% 97.31% 16 77.78% 88.42% 76.67% 81.69% 17 92.96% 91.79% 92.92% 91.69% According to Ms. Logan, certain sub-classes within Classes 10 and 11 have not accepted the Plan. For the schedule of the tabulation for the Class 10 and Class 11 ballots received, see: http://ResearchArchives.com/t/s?133f A list of the ballots not counted pursuant to the rules established by the Court-approved Disclosure Statement is available for download at: http://ResearchArchives.com/t/s?1340 Ms. Logan certifies that Logan & Company has retained the voted ballots and will provide copies of the ballots upon request of the Court, the Debtors, or the Office of the U.S. Trustee. 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. 56; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). * Timothy Porter Joins Proskauer Rose as Senior Counsel ------------------------------------------------------- Proskauer Rose LLP, an international law firm with more than 700 lawyers in the United States and Europe, announced that Timothy L. Porter, a veteran attorney with extensive experience in all types of labor and employment matters and government relations, has joined the firm's Labor and Employment Law Department as senior counsel. He was previously Chief Counsel for Labor, Employment and Environment and Vice President-Law at AT&T, where he worked as an attorney for over 20 years. At AT&T, Mr. Porter was responsible for all of the company's domestic and international labor relations, employment, employee benefits, executive compensation and environmental law matters as well as collective bargaining negotiations, appearances before the Equal Employment Opportunity Commission and labor arbitrations. Prior to serving as Chief Employment Law Counsel, a position he held for 10 years, he led regional and national ?organizations of AT&T's Government Affairs Department, where he interfaced with numerous state and federal officials and regulatory agencies overseeing public utilities. "Tim's considerable experience and skill as a labor negotiator and employment lawyer will be a tremendous asset," said Allen I Fagin, Chairman of Proskauer Rose. "is presence and his strong relationships with high-level government and regulatory officials and civic leaders, as well as executives, business leaders, and scores of general counsel and other in-house attorneys throughout the United States and abroad will enable us to continue our national and international expansion of legal work for global employers, particularly in the areas of labor relations, government affairs, corporate restructurings, employment and environmental law, employee benefits and executive compensation. We also look forward to his assistance with our many diversity initiatives, a subject on which Tim is passionate and has much experience." Mr. Porter was also a member of the Board of Directors of ATTIMCO, AT&T's employee benefit plan asset management company, which manages billions of dollars in assets attributable to the company's retirement and health plans. He joined AT&T in 1974 as an attorney, working on a range of general corporate and labor and employment matters. He went on to direct the company's regulatory, commercial, external affairs and government legal matters before being named Vice President, Government Affairs in 1993, a position he held until he was named Chief Employment Law Counsel in 1996. Mr. Porter is the latest addition to Proskauer's Labor & Employment Law Department, which is widely acknowledged as one of the country's deepest and most well-regarded employment law groups. In recent months, the firm has announced the additions of: * Gregory Rasin and Elise Bloom, veteran employment and class action litigation attorneys who joined the New York office as partners; * John Barry, an experienced employment attorney who joined the Newark office as partner; and * Beverly Frank, a senior counsel in the Los Angeles office with extensive experience in labor and employment litigation in the entertainment industry. About Proskauer Rose Proskauer Rosen LLP -- http://www.proskauer.com/-- founded in 1875, provides legal services to clients throughout the United States and around the world from offices in New York, Los Angeles, Washington, D.C., Boston, Boca Raton, Newark, New Orleans and Paris. The firm has wide experience in all areas of practice important to businesses and individuals, including corporate finance, mergers and acquisitions, general commercial litigation, private equity and fund formation, patent and intellectual property litigation and prosecution, labor and employment law, real estate transactions, internal corporate investigations, white collar criminal defense, bankruptcy and reorganizations, trusts and estates, and taxation. Its clients span industries including chemicals, entertainment, financial services, health care, hospitality, information technology, insurance, Internet, manufacturing, media and communications, pharmaceuticals, real estate investment, sports, and transportation. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- October 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION UTS Fundamentals of Turnaround Management Melbourne, Australia Contact: 0438 653 179 or http://www.turnaround.org/ October 12, 2006 NEW YORK SOCIETY OF SECURITY ANALYSTS Alternative Analysts' Forum: An Insider's Perspective on Distressed Debt Investing New York, NY Contact: http://www.nyssa.org/ October 12, 2006 TURNAROUND MANAGEMENT ASSOCIATION UTS Fundamentals of Turnaround Management Mecure Hotel - Haymarket, Sydney, Australia 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: http://www.beardaudioconferences.com 240-629-3300 October 25, 2006 BEARD AUDIO CONFERENCES Deepening Insolvency - Widening Controversy: Current Risks, Latest Decisions Review Risks, Examine Latest Decisions Affecting Directors, Advisors and Lenders of Troubled Companies Management for Bankruptcy Practitioners and Litigators Contact: http://www.beardaudioconferences.com 240-629-3300 October 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Luncheon Presentation with guest speaker Jeff Carhart of Miller Thomson Petroleum Club, Edmonton, AB 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 18, 2006 TURNAROUND MANAGEMENT ASSOCIATION Dinner Meeting Washington Athletic Club, Seattle, WA Contact: http://www.turnaround.org/ 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 21, 2006 TURNAROUND MANAGEMENT ASSOCIATION Applying Lean Methodology to Manage Operational Turnarounds Oxford Hotel, Denver, CO Contact: http://www.turnaround.org/ October 23, 2006 TURNAROUND MANAGEMENT ASSOCIATION Annual Meeting and Networking Reception 100th Bomb Group & Banquet Facility Cleveland, OH Contact: http://www.turnaround.org/ October 23, 2006 TURNAROUND MANAGEMENT ASSOCIATION A View from the Bench: A Panel Discussion Recent Developments in Bankruptcy Sheraton at Four Seasons, Greensboro, NC Contact: 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 Breakfast Event "The Latest in Fraud Investigations" with guest speaker Chad Cretney of PricewaterhouseCoopers Ernst & Young Tower Calgary, AB Contact: http://www.turnaround.org/ 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 Luncheon & Guest Speaker, Joel Naroff to discuss the economy, lending and M&A markets Davio's Northern Italian Steakhouse, Philadelphia, PA Contact: http://www.turnaround.org/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION Breakfast Meeting Marriott Tyson's Corner, Vienna, Virginia Contact: 703-912-3309 or http://www.turnaround.org/ November 8, 2006 TURNAROUND MANAGEMENT ASSOCIATION TMA Australia National Conference Sydney, Australia Contact: http://www.turnaround.org/ November 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 15-16, 2006 EUROMONEY INSTITUTIONAL INVESTOR Asia Capital Markets Forum Island Shangri-La, Hong Kong Contact: http://www.euromoneyplc.com/ 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, 2006 TURNAROUND MANAGEMENT ASSOCIATION Dinner Program TBA, Seattle, WA Contact: 403-294-4954 or http://www.turnaround.org/ November 16, 2006 TURNAROUND MANAGEMENT ASSOCIATION Life in the Bankruptcy Court with BAPCPA, A View from The Bench Oxford Hotel, Denver, CO Contact: 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 23-24, 2006 EUROMONEY CONFERENCES 5th Annual China Conference China World Hotel Beijing, China Contact: http://www.euromoneyconferences.com/ 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, 2006 EUROMONEY CONFERENCES Euromoney/DIFC Annual Conference Managing superabundant liquidity Madinat Jumeirah, Dubai Contact: http://www.euromoneyconferences.com/ 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 5, 2006 EUROMONEY CONFERENCES CFO Forum Hyatt Regency, Hangzhou, China Contact: http://www.euromoneyconferences.com/ 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 7, 2006 TURNAROUND MANAGEMENT ASSOCIATION Cash Management After The Storm: Near-Term Planning for Long-Term Business Success Sheraton, Metairie, LA Contact: 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/ January 25-27, 2007 AMERICAN BANKRUPTCY INSTITUTE Rocky Mountain Bankruptcy Conference Hyatt Regency, Denver, CO Contact: 1-703-739-0800; http://www.abiworld.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/ April 29 - May 1, 2007 INTERNATIONAL BAR ASSOCIATION International Insolvency Conference Zurich, Switzerland Contact: http://www.ibanet.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 BEARD AUDIO CONFERENCES BAPCPA One Year On: Lessons Learned and Outlook Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Calpine's Chapter 11 Filing Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Changes to Cross-Border Insolvencies Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Changing Roles & Responsibilities of Creditors' Committees Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Clash of the Titans -- Bankruptcy vs. IP Rights Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Coming Changes in Small Business Bankruptcy Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Dana's Chapter 11 Filing Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Deepening Insolvency - Widening Controversy: Current Risks, Latest Decisions Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Distressed Market Opportunities Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Distressed Real Estate under BAPCPA Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Employee Benefits and Executive Compensation under the New Code Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Fundamentals of Corporate Bankruptcy and Restructuring Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Healthcare Bankruptcy Reforms Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES High-Yield Opportunities in Distressed Investing Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Homestead Exemptions under BAPCPA Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Privacy Rights, Protections & Pitfalls in Bankruptcy Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Reverse Mergers-the New IPO? Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Surviving the Digital Deluge: Best Practices in E-Discovery and Records Management for Bankruptcy Practitioners and Litigators Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES Validating Distressed Security Portfolios: Year-End Price Validation and Risk Assessment Contact: http://www.beardaudioconferences.com 240-629-3300 BEARD AUDIO CONFERENCES When Tenants File -- A Landlord's BAPCPA Survival Guide Contact: http://www.beardaudioconferences.com 240-629-3300 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 ***