TCR_Public/061103.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, November 3, 2006, Vol. 10, No. 262

                             Headlines

ACTIS GLOBAL: Posts $1 Million Net Loss in Second Quarter 2006
ADSOUTH PARTNERS: Posts $3.5 Million Net Loss in 2006 2nd Quarter
ADVENTURE PARKS: Taps Langdale & Valloton as Special Counsel
ALLIED HOLDINGS: Explores Potential Merger Deal with Performance
ALLIED HOLDINGS: Excl. Plan-Filing Period Intact Until November 9

ASARCO LLC: Judge Schmidt Approves Intercompany Bar Date Accord
ASARCO LLC: Wants Winters Dorsey as Special Purpose Advisor
ATLANTIC WINE: Posts $16,937 Net Loss in 2006 First Fiscal Quarter
BANTA CORP: RR Donnelley Extends $1.3 Bil. Cash Purchase Offer
BANTA CORP: RR Donnelley Purchase Deal Cues S&P to Revise Outlook

BANTA CORPORATION: Moody's Affirms Ba2 Corporate Family Rating
BENCHMARK ELECTRONICS: S&P Places BB- Rating on CreditWatch
BLOCKBUSTER INC: Outlines New Deal for Online Renters
CAVALIER TELEPHONE: Moody's Rates Proposed $415MM Sr. Loan at B2
COLLINS & AIKMAN: Can Pay Severance Fees to Laid-Off Workers

COLLINS & AIKMAN: Court Okays Rejection of 4 GECC Lease Schedules
COLUMBUS HOSPITAL: Moody's Affirms Rating on $27MM Bonds at B3
COMPLETE RETREATS: Gets Court OK to Employ XRoads as Claims Agent
COMPLETE RETREATS: Court Approves First Insurance Premium Pact
CREDIT SUISSE: S&P Puts Initial 'BB' Ratings to $3.4 Bil. Certs

CWMBS INC: Fitch Affirms Rating on 78 & Upgrades 12 RMBS Classes
DELPHI CORP: Court Approves EDS and HP Outsourcing Agreements
DELPHI CORP: Former Employees Want Funds for Legal Expenses
DORAL FINANCIAL: Aims to Boost Returns & Refinance $625 Mil. Debt
DORAL FINANCIAL: Names Marangal Domingo as Chief Financial Officer

DURA AUTOMOTIVE: Ontario Court Recognizes Chapter 11 Case
EASTON-BELL: Moody's Assigns Loss-Given-Default Ratings
ENTERGY NEW: Parent Company Releases Preliminary 3rd Qtr. Results
ENTERGY NEW ORLEANS: Can Open Investment Account at Federated
FEDERAL-MOGUL: Gets Stay on Discovery Propounded by Mt. McKinley

FEDERAL-MOGUL: Stipulation of Permissible Objections Gets Court OK
FELLOWS ENERGY: Posts $1,392,257 Net Loss in 2006 Second Quarter
FOAMEX INTERNATIONAL: Noteholders Panel Balks at DIP Loan Deal
FOAMEX INT'L: Financial Projections Under First Amended Plan
FORD MOTOR: Reducing Health Care Benefits of Salaried Employees

FORD MOTOR: Shows Improvement in October Sales Figures
FORMAL INC: Case Summary & Largest Unsecured Creditor
GERDAU AMERISTEEL: Completes $104 Mil. West Coast Joint Venture
GULF ATLANTIC: Voluntary Chapter 11 Case Summary
HERBST GAMING: MGM Deal Cues Moody's to Hold Rating at B1

HOME PRODUCTS: Moody's Assigns Loss-Given-Default Rating
ITIS HOLDINGS: Cootes Drive Sues Hunter M.A. Carr & Joanne Hoover
IVI COMMS: Posts $110,702 Net Loss in Quarter Ended June 30
K2 INC: Moody's Assigns Loss-Given-Default Rating
KAISER ALUMINUM: Reports 3rd Qtr. Claim Settlement Fund & Escrow

KAISER ALUMINUM: Settles OCP Status of Fleishman and Hewitt
KARA HOMES: Gets Court Approval to Sell Nine Homes
KOPPERS HOLDINGS: Dr. Whittle to Retire as Europe General Manager
LE-NATURE'S INC: Creditors File Bankruptcy Case in Pennsylvania
LE-NATURE'S INC: Involuntary Chapter 7 Case Summary

LE-NATURE'S: Moody's Sees Ratings Withdrawal After Bankr. Filing
LOGANS ROADHOUSE: Moody's Assigns B2 Corporate Family Rating
LOOMIS SAYLES: Moody's Rates $15MM Class E Notes Due 2020 at Ba2
MERIDIAN AUTOMOTIVE: Court Extends Foreign Unit Financing Period
MERIDIAN AUTOMOTIVE: Sells Mich. Property to Roskam for $2.45 Mil

MESABA AVIATION: Opts to Reject Six Engine Leases with GS Leasing
MESABA AVIATION: Can Enter Into Master Lease Pact with Northwest
NCO GROUP: Earns $11.4 Million in 2006 Third Quarter
NE ENERGY: Fitch Assigns B Issuer Default Rating
NEW YORK RACING: Files for Bankruptcy Protection in Manhattan

NEW YORK RACING: Case Summary & 20 Largest Unsecured Creditors
NOMURA HOME: Fitch Places BB+ Rating on $12.2 Mil. Class B-2 Certs
NORTH AMERICAN: Moody's Lowers Corp. Family Rating One Notch to B3
NORTHEAST GENERATION: S&P Lifts Rating on $320 Mil. Bonds to BB-
NORTEL NETWORKS: Secures $7.7 Million NRC Maintenance Contract

NUTECH DIGITAL: Posts $399,002 Net Loss in 2006 Second Quarter
OWENS CORNING: Reorganization Cues S&P to Lift Default Rating
PERFORMANCE TRANSPORTATION: Files Stipulation on $7MM Yucaipa Loan
PERFORMANCE TRANSPORTATION: Withdraws Bonus Program Modifications
PEMBRIDGE SQUARE: Fitch Rates EUR16 Million Class H Notes at BB+

PREMIER ENTERTAINMENT: Taps Byrd & Wiser as Bankruptcy Counsel
PURE FISHING: Moody's Assigns Loss-Given-Default Ratings
PURE MORTGAGES: Moody's Affirms Ba2 Rating on $23-Mil. Notes
REEDS INC.: Posts $587,238 Net Loss in 2006 Second Quarter
REFCO INC: Court Gives Final Okay on Amended Disclosure Statement

REFCO INC: Court Sets December 15 Joint Plan Confirmation Hearing
REFCO INC: Court Provides Clarification on Nov. 15 Claims Bar Date
SALOMON BROTHERS: Moody's Ratings on 3 Cert. Classes Slides to C
SMALL WORLD: Posts $4.9 Million Net Loss in 2006 Second Quarter
STRUCTURED ASSET: Fitch Downgrades Ratings on Five Cert. Classes

TIME WARNER: Buys Xspedius Communications for $216 Million in Cash
UNITEDHEALTH GROUP: CalPERS Wants to Block CEO's Retirement Pay
UNITEDHEALTH GROUP: Earns $1.101 Billion in Third Quarter of 2006
UNITED KAISER: Case Summary & Eight Largest Unsecured Creditors
USA COMMERCIAL: Judge Riegle Disapproves Chapter 7 Conversion

VARIG S.A.: Foreign Rep Objects to Port Authority's Payment Motion
WAVE WIRELESS: Case Summary & 20 Largest Unsecured Creditors
WELD WHEEL: Court Okays Spencer Fane as Committee's Lead Counsel
WELD WHEEL: Ct. OKs Mesirow Financial as Panel's Financial Advisor
WELLMAN INC: Poor Performance Cues Moody's to Lower Rating to B3

WESLEY TENNYSON: Case Summary & 20 Largest Unsecured Creditors
WINN-DIXIE: Court Approves Five Alabama Power Agreements
WINN-DIXIE: Wants TRP-Held SRP Plan Assets Transferred
WOLVERINE TUBE: Mulls Chapter 11 Filing
WOLVERINE TUBE: S&P Cuts Corp. Credit Rating to CC from CCC+

WOLVERINE TUBE: Bankruptcy Plan Prompts Junks Ratings by Moody's

* BOOK REVIEW: The Managerial Mystique: Restoring Leadership in
               Business

                             *********

ACTIS GLOBAL: Posts $1 Million Net Loss in Second Quarter 2006
--------------------------------------------------------------
Actis Global Ventures, Inc., reported a $1,046,142 net loss on
$3,045,700 of revenues for the second quarter ended June 30, 2006,
compared with a $48,081 net loss on $1,796,627 of revenues for the
same period in 2005.

The increase in net sales of $1,249,073 or 70% over 2005 is
primarily due to a net increase in revenue from Direct Sales from
the BIOPRO Technology division of $2,725,219, or 69% over 2005,
while the increase in net loss from 2005 is due primarily to the
increase in non-cash expense recorded in the 2006 period.

At June 30, 2006, the company's balance sheet showed $2,045,800 in
total assets, $5,346,638 in total liabilities and $44,843 in
minority interest in subsidiaries, resulting in a $3,345,681
stockholders' deficit.

The company's balance sheet at June 30, 2006, also showed strained
liquidity with $1,289,849 in total current assets available to pay
$5,346,638 in total current liabilities.

Full-text copies of the company's second quarter financial
statements are available for free at:
                
                http://researcharchives.com/t/s?1458
                           
                           Going Concern

Peterson & Co., LLP, expressed substantial doubt about Actis
Global Ventures, Inc.'s ability to continue as a going concern
after auditing the company's financial statements for the years
ended Dec. 31, 2005 and 2004.  The auditing firm pointed to the
company's recurring losses from operations and working capital
deficiency at Dec. 31, 2005 and 2004.
                         
                         About Actus Global

Actis Global Ventures, Inc.,  --
http://www.actisglobalventures.com/-- is an early stage company  
that markets, sells and distributes a variety of products designed
to provide consumers with a new generation of wellness solutions.  
The company sells their products primarily though Direct Sales
through two divisions, BIOPRO and FemOne, and the company also
sells their Channoine cosmetic products through the Direct
Response Television Shopping Network.


ADSOUTH PARTNERS: Posts $3.5 Million Net Loss in 2006 2nd Quarter
-----------------------------------------------------------------
Adsouth Partners, Inc. reported a $3,502,000 net loss on $795,000
of revenues for the quarter ended June 30, 2006, compared with a
$1,322,000 net loss on $277,000 of revenues for the comparable
period in 2005.

All $795,000 of the company's revenues for the second quarter of
2006 were from generator sales and all $277,000 of the company's
revenues for the second quarter of 2005 were from the advertising
services segment.

As of June 30, 2006, the company's balance sheet showed $5,310,000
in total assets and $7,881,000 in total liabilities, resulting in
a $2,571,000 stockholders' deficit.

The company's balance sheet at June 30, 2006, also showed strained
liquidity with $3,937,000 in total current assets available to pay
$7,835,000 in total current liabilities.

                            Outlook

On Aug. 1, 2006. the company and its subsidiaries sold to MFC
Development Corp. substantially all of the assets of its product
sector.  Only the generator sales and advertising services
segments remain.  During the three months ended June 30, 2006, two
advertising customers who are no longer customers, represented 41%
and 20% of total revenues.

In addition, the company is a defendant in a recently-commenced
litigation by one of their advertising customers seeking
damages in excess of $2,000,000.  Although the company believes it
has meritorious defenses against such lawsuit, an unfavorable
outcome of such action would have a materially adverse impact on
its business and its ability to continue operating.
                                                        
                      About Adsouth Partners

Adsouth Partners, Inc. -- http://www.adsouthpartners.com/-- is a   
vertically integrated direct response marketing company that
generates revenues from the placement of advertising, the
production of advertisements, creative advertising and public
relations consulting services.  Since December 2005, through
a majority-owned subsidiary, Genco Power Solutions, Inc. --
http://www.gencopowersolutions.com-- the company has been   
marketing integrated power generator systems to residential
homeowners and commercial businesses throughout Florida.


ADVENTURE PARKS: Taps Langdale & Valloton as Special Counsel
------------------------------------------------------------
Adventure Parks Group LLC and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Middle District of Georgia for
permission to employ Langdale & Vallotton LLP, as their special
counsel.

Specifically, the firm will:

     a) serve as general non-bankruptcy corporate counsel;
     
     b) represent the Debtors in pending civil actions; and

     c) perform other duties as may be requested.

The hourly rates for the firm's professionals are:

        Designation             Hourly Rate
        -----------             -----------
        Senior Partners            $300
        New Associates             $150
        Legal Assistants         $150-$300

The Debtors' application further shows that:

     -- the firm served as general counsel for the Debtors, for
        which services it has been fully compensated;

     -- William Langdale, Jr., is the holder of an equity     
        interest in the Debtors; and

     -- Palmetto Holdings LLP, a partner of William P. Langdale,
        Jr. and William P. Langdale, III, holds an equity
        interest in the Debtors.

William P. Langdale, III, Esq., member of the firm, assures the
Court that his firm does not hold any interest adverse to the
Debtors, its estate or creditors.

Mr. Langdale can be reached at:

     William P. Langdale, III, Esq.
     Langdale & Vallotton, LLP
     1007 North Patterson Street
     Valdosta, Georgia 31601
     Tel: (229) 244-5400
     Fax: (229) 244-0453
          (229) 244-5475
     http://www.langdalevallotton.com/

Headquartered in Valdosta, Georgia, Adventure Parks Group, LLC, is
the holding company of Wild Adventures and Cypress Gardens.  Wild
Adventures operates an amusement park in Valdosta, Georgia while
Cypress operates an amusement park in Winter Haven, Florida.  The
Company, along with Wild Adventures and Cypress Gardens, filed for
chapter 11 protection on Sept. 11, 2006 (Bankr. M.D. Ga. Case Nos.
06-70659 through 06-70661).  George H. McCallum, Esq., James P.
Smith, Esq., and Ward Stone, Jr., Esq., at Stone & Baxter, LLP,
represent the Debtors.  When the Debtors filed for protection from
their creditors, they estimated assets and debts between
$50 million and $100 million.


ALLIED HOLDINGS: Explores Potential Merger Deal with Performance
----------------------------------------------------------------
Alvarez & Marsal, LLC, chief restructuring officer of Performance
Transportation Services, Inc., discloses in its first interim fee
application that it "conducted limited due diligence on Allied
[Holdings, Inc.,] and coordinated discussions with Allied
regarding [a] potential business combination."

Timothy Skillman, managing director at Alvarez & Marsal, reports
that on July 24, 2006, he met and discussed merger related issues
with Allied and Yucaipa American Alliance Fund I, LP, and Yucaipa
American Alliance (Parallel) Fund I, LP.

Yucaipa is a premier private equity investment firm that has
established a record of fostering economic value through the
growth and responsible development of companies.  As an investor,
Yucaipa works with management to strategically reposition
businesses and implement operational improvements, resulting in
value creation for shareholders, customers and employees.

Since its founding in 1986, Yucaipa has completed mergers and
acquisitions valued at more than $30,000,000,000.  Among other
investments, Yucaipa holds approximately $100,000,000 of senior
unsecured claims against Allied.

Performance, the second largest vehicle-hauler in North America,
is the Debtors' primary competitor in the vehicle-delivery
business on a nation-wide basis.  Allied and Performance
specifically compete for assembly plant contracts with original
equipment manufacturers.

Performance and certain of its affiliates filed for Chapter 11 in
the U.S. Bankruptcy Court for the Western District of New York,
Buffalo Division.  The Performance Debtors disclosed a $2,932,900
operating net loss on August 31, 2006.  Bankruptcy Creditors'
Service, Inc., also publishes Performance Bankruptcy News,
providing detailed coverage of its chapter 11 restructuring.

Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide  
short-haul services for original equipment manufacturers and
provide logistical services.  The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537).  Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts.  Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor.  Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee.  When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts.  (Allied Holdings Bankruptcy News, Issue No. 33;
Bankruptcy Creditors' Service, Inc. http://bankrupt.com/newsstand/
or 215/945-7000)


ALLIED HOLDINGS: Excl. Plan-Filing Period Intact Until November 9
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
issued a bridge order extending the exclusive period within which
Allied Holdings, Inc., and its debtor-affiliates may file a plan
of reorganization through and including Nov. 9, 2006.

As reported in the Troubled Company Reporter on Oct. 26, 2006, the
Debtors are seeking a twelve-week extension of the periods during
which they have the exclusive right to:

    * propose and file a plan of reorganization through and
      including Jan. 17, 2007; and

    * solicit acceptances of that plan through and including
      March 21, 2007.

The Court will convene a hearing on Nov. 8, 2006, to consider
the Debtors' request.

Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide  
short-haul services for original equipment manufacturers and
provide logistical services.  The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537).  Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts.  Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor.  Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee.  When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts.  (Allied Holdings Bankruptcy News, Issue No. 33;
Bankruptcy Creditors' Service, Inc. http://bankrupt.com/newsstand/
or 215/945-7000)


ASARCO LLC: Judge Schmidt Approves Intercompany Bar Date Accord
---------------------------------------------------------------
The Honorable Richard Schmidt of the U.S. Bankruptcy Court for the
Southern District of Texas in Corpus Christi approves the
stipulation among ASARCO LLC and its debtor-affiliates, the
Official Committee of Unsecured Creditors for ASARCO LLC and the
Asbestos Subsidiary Debtors, and Robert C. Pate, as future claims
representative.  

Pending further Court order, the Bar Dates established in the Bar
Date Order are extended solely with respect to the Intercompany
Claims of the non-filing subsidiaries of ASARCO LLC.

The Asbestos Subsidiary Debtors are Lac d'Amiante Du Quebec Ltee,
CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.

As reported in the Troubled Company Reporter on Oct. 17, 2006, the
parties agreed that:

   (a) Pending further Court order, the Bar Dates are extended
       solely with respect to Intercompany Claims;

   (b) The Bar Dates applicable to claims asserted by any party
       other than one of the Debtors are not modified and remains
       in full force;

   (c) Upon completion of the Intercompany Claims' investigation,
       the Debtors and the ASARCO Committee may file a
       supplemental bar date notice with the Court establishing a
       new bar date with respect to the Intercompany Claims,
       provided that the notice must be filed at least 30 days
       before that Intercompany Claims Bar Date;

   (d) The complaints filed by the Asbestos Committee and the FCR
       in the Derivative Asbestos Claims Adversary Proceeding
       constitute a proof of claim by the Asbestos Debtors
       against ASARCO.  The amounts asserted in the Asbestos
       Debtors' Proofs of Claim will be determined by the Court
       pursuant to the Asbestos Claims Estimation Motion, which
       amount will be incorporated by ASARCO in its plan of
       reorganization; and

   (e) Any other Intercompany Claims asserted by the Asbestos
       Debtors will be filed by the Asbestos Committee by
       Jan. 31, 2007.

                         About ASARCO LLC

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,  
smelting and refining company.  Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent.  The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor
in its restructuring efforts.  Lehman Brothers Inc. provides the
ASARCO with financial advisory services and investment banking
services.  Paul M. Singer, Esq., James C. McCarroll, Esq., and
Derek J. Baker, Esq., at Reed Smith LLP give legal advice to
the Official Committee of Unsecured Creditors and David J.
Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee.  When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and
$1 billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered
with its chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case
was converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee.  Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7
Trustee. (ASARCO Bankruptcy News, Issue No. 31; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/
or 215/945-7000).


ASARCO LLC: Wants Winters Dorsey as Special Purpose Advisor
-----------------------------------------------------------
ASARCO LLC seeks authority from the U.S. Bankruptcy Court for the
Southern District of Texas in Corpus Christi to employ Winters,
Dorsey & Company, LLC, as special purpose consulting experts to
Baker Botts LLP, nunc pro tunc to Sept. 1, 2006.

ASARCO has previously commenced a complaint against Mineral Park
Inc. in connection with the sale of the South Mill Assets a month
before it filed for bankruptcy.  ASARCO asserted that it failed to
receive reasonably equivalent value in exchange for the transfer
of the South Mill Assets.

James R. Prince, Esq., at Baker Botts, in Dallas, Texas, relates
that ASARCO needs to employ professionals who can provide
valuation services in connection with the Adversary Proceeding.

Mr. Prince tells the Court that WDC has already prepared a
preliminary valuation report in connection with the Adversary
Proceeding.

Aside from the preliminary report, WDC will prepare a final
report for trial and more reports as needed.  WDC will also
provide other expert consulting services to Baker Botts.

Mr. Prince says WDC has accrued approximately $100,000 in fees
and expenses for the preparation of the preliminary expert
report.  For additional work, ASARCO will pay WDC in its
customary hourly rates.

Harry Winters, Jr., president of WDC, will be paid $350 per hour.  
Other professionals from WDC who may provide services to ASARCO
will be paid from $150 to $250 per hour.

ASARCO estimates that professional fees for WDC will range from
$95,000 to $116,000.  ASARCO will also reimburse WDC for its
reasonable out-of-pocket expenses.

Mr. Winters assures the Court that WDC is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code, and does not represent any other entity having
adverse interests to ASARCO and its estate.

                         About ASARCO LLC

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,  
smelting and refining company.  Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent.  The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor
in its restructuring efforts.  Lehman Brothers Inc. provides the
ASARCO with financial advisory services and investment banking
services.  Paul M. Singer, Esq., James C. McCarroll, Esq., and
Derek J. Baker, Esq., at Reed Smith LLP give legal advice to
the Official Committee of Unsecured Creditors and David J.
Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee.  When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and
$1 billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered
with its chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case
was converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee.  Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7
Trustee. (ASARCO Bankruptcy News, Issue No. 31; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/
or 215/945-7000).


ATLANTIC WINE: Posts $16,937 Net Loss in 2006 First Fiscal Quarter
------------------------------------------------------------------
Atlantic Wine Agencies Inc. reported a $16,937 net loss on $55,959
of sales for the first fiscal quarter ended June 30, 2006,
compared with a $454,507 net loss on $94,302 of sales for the same
period in 2005.

At June 30, 2006, the company's balance sheet showed $3,704,411 in
total assets, $1,756,928 in total liabilities, and $1,947,483 in
total stockholders' equity.

The company's balance sheet at June 30, 2006, also showed strained
liquidity with $975,180 in total current assets available to pay
$1,756,928 in total current liabilities.

Full-text copies of the company's first fiscal quarter financial
statements are available for free at:
                                                 
                http://researcharchives.com/t/s?144a
                          
                          Going Concern

As reported on the Troubled Company Reporter on July 20, 2006,
Meyler & Company, LLC, in Middletown, New Jersey, raised
substantial doubt about Atlantic Wine Agencies, Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the years ended March 31,
2006, and 2005.  The auditor pointed to the company's losses since
inception and uncertainties over its ability to obtain additional
capital and operate successfully.
                                 
                        About Atlantic Wine
                         
Headquartered in London, Atlantic Wine Agencies, Inc. --  
http://www.atlanticwineagencies.com/-- is a public listed company    
supported by a small group of key investors who are passionate
wine enthusiasts.  The company purchased Mount Rozier Estatem, a
world-class vineyard estate in Stellenbosch, South Africa, in
February 2004.  The group has two key business areas: a brand
building wine business and a leisure/lifestyle development
business.  Each is operated separately with management and
organizations within the group under the control of the main
board.


BANTA CORP: RR Donnelley Extends $1.3 Bil. Cash Purchase Offer
--------------------------------------------------------------
RR Donnelley & Sons Company disclosed that it has signed a
definitive agreement with Banta Corporation, pursuant to which RR
Donnelley will acquire Banta Corporation, in an all-cash deal, for
approximately $1.3 billion, or $36.50 per share, after the special
dividend of $16 per share declared by Banta Corp.

The agreement has been unanimously approved by the Boards of
Directors of both companies and is expected to close in the first
quarter of 2007.  The acquisition is expected to be accretive to
RR Donnelley's earnings in the first full year after the closing
of the transaction and is subject to customary closing conditions,
including regulatory approval and approval of Banta shareholders.

The combination will enable RR Donnelley to expand the range of
products and services it offers customers, while at the same time
enhancing its services to the magazine, catalog, book and direct
marketing segments.

"Banta is an exceptional fit with RR Donnelley," Mark A. Angelson,
RR Donnelley's chief executive officer, said.  "This combination
will create immediate cross-selling opportunities with our blue-
chip customers as well as offer substantial synergies in our
procurement, manufacturing and services operations.  We are
delighted to have the opportunity to better serve our customers by
expanding the flexibility of our combined global manufacturing and
service platforms.  The addition of Banta furthers our goal of
increasing long-term shareholder value and we look forward to
maximizing the benefits for our customers, employees and
investors."

"RR Donnelley's innovative, customer-centered approach, broad
product and service mix and emphasis on developing value-added
solutions mirrors Banta's," Stephanie A. Streeter, Banta's
chairman and chief executive officer, said.  "Joining these two
highly successful, complementary companies will result in a
combined organization that creates new and exciting opportunities
for our customers and employees moving forward.  Together, the
companies will offer enhanced capabilities and an increased array
of options to our customers and I look forward to working closely
with RR Donnelley's management to ensure a smooth transition."

Goldman, Sachs & Co. served as financial advisor to R.R. Donnelley
and Sullivan & Cromwell LLP provided legal counsel.  UBS
Securities LLC served as financial advisor to Banta Corp. and
Foley & Lardner LLP provided legal counsel.

                       About RR Donnelley

RR Donnelley (NYSE: RRD) -- http://www.rrdonnelley.com-- provides  
solutions in commercial printing, direct mail, financial printing,
print fulfillment, labels, forms, logistics, call centers,
transactional print-and-mail, print management, online services,
digital photography, color services, and content and database
management to customers in the publishing, healthcare,
advertising, retail, technology, financial services and many other
industries.

                       About Banta Corp.

Headquartered in Menasha, Wisconsin, Banta Corporation provides a
combination of printing and digital imaging solutions to
publishers and direct marketers through its printing services
segment, and a range of outsourcing capabilities through its
supply-chain management services.


BANTA CORP: RR Donnelley Purchase Deal Cues S&P to Revise Outlook
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its CreditWatch listing
on Banta Corp. 'BB' ratings to positive from negative implications
following the company's announcement that it has signed a
definitive agreement to be acquired by R.R. Donnelley & Sons Co.
for cash.

In addition, on Oct. 31, 2006, Cenveo Inc. withdrew its proposal
to acquire Banta.  The positive CreditWatch listing reflects the
proposed purchase of Banta by a higher-rated company.
     
Donnelley will pay $1.3 billion for Banta or $36.5 per common
share after the special dividend of $16.00 per share already
declared by Banta.  At the same time, Standard & Poor's placed its
ratings on Donnelley on CreditWatch with negative implications.  
The acquisition has been approved by the boards of directors of
both companies and is expected to close in the first quarter of
2007.

Following the close of the acquisition, if debt at Banta were
refinanced, Standard & Poor's would expect to withdraw its ratings
on the company.


BANTA CORPORATION: Moody's Affirms Ba2 Corporate Family Rating
--------------------------------------------------------------
Moody's Investors Service affirmed the Baa2 Senior Unsecured and
P-2 short-term ratings of RR Donnelley and Sons Company, while
placing the Ba2 Corporate Family Rating, Ba2 Senior Secured
rating, Ba3 Probability of Default and LGD3 (39%) Loss-Given-
Default rating of Banta Corporation under review for possible
upgrade.  

The SGL-1 liquidity rating of Banta remains unchanged.

This action reflects the announcement that RRD has made a
$900 million all-cash acquisition offer for Banta ($36.50/share),
which has been approved by Banta's Board.  Banta will also pay an
extraordinary dividend of approximately $400 million to its
shareholders ($16/share).  

The outlook for RRD's ratings remains negative.

The affirmation of RRD's long term rating reflects Moody's belief
that the acquisition, if consummated, will not negatively affect
RRD's credit metrics by 2008, assuming, importantly, that the
company dedicates all of its expected cash flow towards debt
reduction.

Moody's expects an immediate deterioration of credit metrics, but
the rating has been maintained because Moody's believes the
company is likely to focus on debt reduction following the Banta
acquisition.  The Debt/EBITDA is expected to increase
approximately _ of a turn towards 3X, pro-forma for 2006, before
reducing back towards 2x by 2008.  

Moody's also assumes that there will be some synergy benefits to
come from this acquisition by 2008, after usual interim
integration and restructuring costs are incurred in 2007.

The outlook for RRD's ratings remains negative because of Moody's
concerns over the continuing difficult conditions in the printing
industry, as well as both acquisition risk and the potential for
share buybacks.  

RRD has been acquisitive over the past several years and although
Moody's has concluded that the proposed acquisition of Banta can
be accommodated within the existing Baa2 rating, the risk remains
that RRD will undertake one or more future acquisitions that will
collectively cause a deterioration of expected 2008 credit
metrics.  

As well, even though Moody's is currently assuming that RRD will
dedicate all cash flow to debt reduction following the proposed
acquisition, the company has nevertheless recently authorized a
$350 million share buyback program.

The review of Banta's ratings will focus on the likelihood of the
acquisition closing, the potential for RRD to refinance Banta's
debt, and the impact on its standalone operating performance and
credit metrics caused by its pending ownership by RRD.

On Review for Possible Upgrade:

   * Issuer: Banta Corporation

     -- Corporate Family Rating, Placed on Review for Possible
        Upgrade, currently Ba2

Outlook Actions:

     -- Issuer: Banta Corporation
     -- Outlook, Changed To Rating Under Review From Stable

RR Donnelley and Sons Company, the world's largest commercial
printer with revenue of over $9 billion, is headquartered in
Chicago, Illinois. Banta Corporation, a commercial printer with
revenue of approximately $1.5 billion, is headquartered in
Menasha, Wisconsin.


BENCHMARK ELECTRONICS: S&P Places BB- Rating on CreditWatch
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit rating on Angleton, Texas-based Benchmark Electronics Inc.
on CreditWatch with positive implications after the company
announced it will acquire Pemstar Inc. in a stock transaction
valued at about $300 million.

Pemstar is an electronics manufacturing service company that has
good penetration in adjacent markets to Benchmark.  Pemstar
reported revenues of $871 million for the fiscal year ended
March 31, 2006, approximately 46% of which is derived from
industrial equipment programs, nearly double Benchmark's revenue
contribution from that segment.  

Profitability has been suppressed by restructuring actions and an
unprofitable contract that is being evaluated to determine
strategic alternatives.
      
"The acquisition will broaden Benchmark's market reach in higher
margin, stable programs in industrial equipment as well as
augmenting low cost manufacturing capacity," said Standard &
Poor's credit analyst Lucy Patricola.

The acquisition will increase Benchmark's revenue by over 30% and
enhance its business position, which has been a limiting factor
for its ratings.  While Benchmark retains sufficient liquidity to
extinguish Pemstar debt of about $100 million, leverage would
remain low, under 1x, if the debt remains outstanding.
  
S&P will meet with management to discuss and evaluate the enhanced
business prospects of the combined companies, as well as any
restructuring costs and their impact, to determine the final
impact on the rating.


BLOCKBUSTER INC: Outlines New Deal for Online Renters
-----------------------------------------------------
Blockbuster Inc. is giving online renters expanded access to
movies through the introduction of BLOCKBUSTER Total Access(TM), a
movie rental program that gives online customers the option of
returning their DVDs through the mail or exchanging them at more
than 5,000 participating BLOCKBUSTER(R) stores for free in-store
movie rentals.  The new program, available only from Blockbuster,
means Total Access subscribers don't need to wait to get DVDs
through the mail, essentially allowing them to double the number
of movies they can access each month.

Beginning Nov. 1, Blockbuster will automatically upgrade all
current and new online rental subscribers to the Blockbuster Total
Access program at no extra cost, immediately giving them the
option of mailing back their online movies, exchanging them at any
participating Blockbuster store, or a combination of the two.  For
each online rental exchanged in the store, customers can receive a
free in-store movie rental.  Subscribers to Blockbuster's lower-
priced $5.99 and $7.99 plans will also be included in the Total
Access program and will be able to exchange their online DVDs for
free in-store movie rentals.

Another feature Blockbuster Total Access offers subscribers is a
faster shipping cycle.  When subscribers return their online
rentals to a participating Blockbuster store, the store check-in
process automatically initiates the shipment of the next available
movies in the subscriber's rental queue, whether they take
advantage of the in-store exchange option or not.  That means
Total Access customers generally will get their online movies a
day faster than if they had dropped the return movies in the mail.

In addition to being able to exchange online rentals at
participating Blockbuster stores for free movie rentals,
Blockbuster Total Access customers will also receive a free in-
store rental coupon each month.  Subscribers can use the monthly
rental coupon in the same visit with their in-store exchanges for
another free movie, or by itself if they have already returned
their DVDs through the mail or just aren't ready to return their
online rentals yet.  Movies received through the in-store exchange
option or with the rental coupon do not count against the total
number of DVDs an online customer can have out at any one time per
their subscription plan.

In-store movies are still subject to store rental terms, including
due dates, and must be returned to the store from which they were
rented.

Another added convenience is that customers can now sign up for
Blockbuster's online rental service right in the stores.  With the
launch of the Blockbuster Total Access program, almost all
participating Blockbuster stores will have online wireless access,
so store personnel can sign up new subscribers on the spot.

As of the end of September, Blockbuster had approximately 1.5
million online subscribers, a year-over-year increase in its
subscriber base of 50 percent, which included some 100,000 trial
subscribers at quarter-end who subsequently converted to paying
members. During the third quarter, the company added approximately
150,000 net subscribers.

With more than 60,000 titles to choose from online, Blockbuster
delivers DVDs right to subscribers' mailboxes in return-pre-paid
postage envelopes.  There are no due dates or late fees with
movies rented from Blockbuster's online rental service, and
subscription plans start as low as $5.99 a month, with the $17.99
three-out unlimited movie plan being the most popular.  A two-
week free trial membership to Blockbuster Total Access is
available for a limited time, including to those customers who
have previously tried Blockbuster's online rental service but are
not currently subscribing to the service.

                      About Blockbuster

Blockbuster Inc. -- http://www.blockbuster.com/-- provides  
in-home movie and game entertainment, with more than 9,000 stores
throughout the Americas, Europe, Asia and Australia..

                        *    *    *

As reported in the Troubled Company Reporter on Oct. 11, 2006,
Moody's Investors Service affirmed its B3 Corporate Family Rating
for Blockbuster Inc. in connection with its implementation of the
new Probability-of-Default and Loss-Given-Default rating
methodology for the US and Canadian Retail sector.

Standard & Poor's Ratings Services lowered, in November 2005,
its corporate credit and bank loan ratings on Blockbuster Inc.
to 'B-' from 'B' and the subordinated note rating to 'CCC' from
'CCC+'. S&P said the outlook is negative.

Fitch downgraded, in August 2005, Blockbuster Inc.'s Issuer
default rating to 'CCC' from 'B+'; Senior secured credit
facility to 'CCC' from 'B+' with an 'R4' recovery rating; and
Senior subordinated notes to 'CC' from 'B-' with an 'R6'
recovery rating.


CAVALIER TELEPHONE: Moody's Rates Proposed $415MM Sr. Loan at B2
----------------------------------------------------------------
Moody's Investors Service assigned a B2 rating for the proposed
$415 million senior secured term loan and the $20 million
revolving credit facility at CavTel Holdings, LLC.  

The ratings 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 LGD3.

In addition, Moody's affirmed Cavalier's B2 corporate family
rating, and the B2 rating on the existing credit facilities.  

The outlook remains stable.

The new credit facility will be used to fund the acquisition of
TalkAmerica Holdings and to refinance existing debt.  At the
closing of the transaction, the ratings on the existing facilities
will be withdrawn.

   * Issuer: CavTel Holdings, LLC

     -- Corporate Family Rating -- Affirmed B2

     -- Probability of Default Rating -- Affirmed B3

     -- Senior 1st lien secured Revolving Credit Facility Due
        2011 -- Assigned B2, LGD3-31%

     -- Senior 1st lien secured Term Loan Due 2012 -- Assigned
        B2, LGD3-31%

     -- Existing 1st lien $20 million Revolving Credit Facility
        Due 2011 -- Affirmed B2, LGD3-31%

     -- Existing 1st lien $185 million Term Loan Due 2012 --
        Affirmed B2, LGD3-31%

     -- Outlook - Stable

The B2 corporate family rating reflects Cavalier's financial risk,
challenging competitive position as a CLEC, increased capital
spending on the IPTV initiative and the complexity of turning
around and integrating TalkAmerica within its operations.

The ratings also incorporate the inherent risk of Cavalier's
greater reliance on the residential telephony market relative to
its CLEC peers, as the residential customers typically have higher
churn rates.  The ratings benefit from the company's larger
operating scale and the expected EBITDA growth driven by merger
synergies.  The company's leverage (which includes 75% of
preferred stock accounted as debt, in accordance with Moody's
methodology, and adjusted for operating leases) is expected to be
about 3.8x TTM 2Q 2006, proforma for the acquisition.

The stable rating outlook considers the company's growth plans and
the reasonable likelihood of achieving merger synergies to resume
generating free cash flow to drive deleveraging over the rating
horizon.

Given the challenges management will face in integrating
TalkAmerica's operations and achieving cost synergies, the ratings
are somewhat prospective in nature.  Should the company fail to
quickly realize on the expected merger benefits or if residential
churn were to stay close to the 5% threshold, the outlook and the
rating could come under downward pressure.

The B2 rating of the term loan and the revolver reflects an LGD3
loss given default assessment, as these senior secured credit
facilities represent largely the entire debt capital of the
company, and the assumed 65% family recovery rate given its
current all bank debt capital structure.

Cavalier is a CLEC servicing approximately 400,000 access lines in
5 mid-Atlantic United States.  The company maintains its
headquarters in Richmond, Virginia.  TalkAmerica is a CLEC
servicing approximately 450,000 access lines, in the Midwest and
Southeast, and is headquartered in Reston, Virginia.


COLLINS & AIKMAN: Can Pay Severance Fees to Laid-Off Workers
------------------------------------------------------------
The U.S Bankruptcy Court for the Eastern District of Michigan
authorized Collins & Aikman Corporation and its debtor-affiliates
to pay severance benefits in connection with their planned
reduction-in-force.

As part of their ongoing efforts to cut costs and increase
operational efficiency, the Debtors determined, in consultation
with JPMorgan Chase Bank, N.A., the administrative agent for their
senior, secured prepetition lenders, and the Official Committee of
Unsecured Creditors, to implement the RIF.  In particular, the
Debtors plan to reduce the number of salaried employees by
approximately 125, representing approximately $7,600,000 in annual
base salaries.

As reported in the Troubled Company Reporter on Oct. 17, 2006, the
Debtors want to provide severance benefits to employees affected
by the RIF.  For these employees, the Debtors intend to give, upon
execution of a release acceptable to the Debtors:

   (a) a severance package equivalent to (i) up to four weeks of
       base salary and (ii) any accrued and unused vacation; and

   (b) continued employee benefits for up to four weeks.

The base salary component of the Severance Benefits would be
subject to an aggregate limit of $650,000.

The cap does not include any payments to employees of non-debtors
that may be affected by the RIF.

Should additional reductions-in-force become necessary to complete
their restructuring process, the Debtors intend to return to the
Court for approval of severance-related benefits.

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in  
cockpit modules and automotive floor and acoustic systems and is
a leading supplier of instrument panels, automotive fabric,
plastic-based trim, and convertible top systems.  The Company
has a workforce of approximately 23,000 and a network of more
than 100 technical centers, sales offices and manufacturing
sites in 17 countries throughout the world.  The Company and its
debtor-affiliates filed for chapter 11 protection on May 17,
2005 (Bankr. E.D. Mich. Case No. 05-55927).  Richard M. Cieri,
Esq., at Kirkland & Ellis LLP, represents C&A in its
restructuring.  Lazard Freres & Co., LLC, provides the Debtor
with investment banking services.  Michael S. Stammer, Esq., at
Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors Committee.  When the Debtors
filed for protection from their creditors, they listed
$3,196,700,000 in total assets and $2,856,600,000 in total
debts.  (Collins & Aikman Bankruptcy News, Issue No. 44;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


COLLINS & AIKMAN: Court Okays Rejection of 4 GECC Lease Schedules
-----------------------------------------------------------------
The Honorable Steven W. Rhodes of the U.S. Bankruptcy Court for
the Eastern District of Michigan authorizes Collins & Aikman
Corporation and its debtor-affiliates to reject, as of Sept. 22,
2006, four lease schedules under their May 7, 1993 Master Lease
Agreement with General Electric Capital Corporation.

As reported in the Troubled Company Reporter on Oct. 4, 2006, the
Debtors sought to reject these lease schedules:

   (1) Schedule No. 5, Serial Nos. 96386 to 96390;
   (2) Schedule No. 16, Serial No. 299;
   (3) Schedule No. 7, Serial Nos. 96407, 96354, and 96353; and
   (4) Schedule No. 19, Serial No. 96381.

The U.S. District Court for the Eastern District of Michigan,
Southern Division, recently denied GECC's appeal with regard to
the Bankruptcy Court's ruling concerning the Master Lease
Agreement.

GECC had informed the Bankruptcy Court that it will take an
appeal to the District Court from the order denying its request
to compel payments under its master lease agreements with the
Debtors.

GECC wanted the District Court to determine whether:

   a. the Bankruptcy Court erred in denying GECC's request to
      compel payments first due at least 60 days after the
      Petition Date under certain master lease agreements; and

   b. the Bankruptcy Court erred by, over GECC's objection,
      instituting a procedure to rule on the relief requested in
      the Request when:

      (1) the procedure resulted in the denial of the Motion and
          the continued use by the Debtors of the equipment
          leased under the Products Leases without any evidence
          or suggestion that the Debtors will have the financial
          wherewithal to pay the accrued and accruing
          obligations under the Products Leases by which the
          Debtors remain bound;

      (2) the procedure is not contemplated by the Bankruptcy
          Code or the Federal Rules of Bankruptcy Procedure; and

      (3) the procedure denied GECC due process of law in
          violation of Article V of the Constitution in that it
          did not (a) afford GECC the opportunity to submit a
          brief, (b) allow GECC to conduct discovery, (c) allow
          GECC to depose the Debtors' witnesses, or (d) allow
          GECC to cross examine the Debtors' witnesses at the
          hearing.

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in  
cockpit modules and automotive floor and acoustic systems and is
a leading supplier of instrument panels, automotive fabric,
plastic-based trim, and convertible top systems.  The Company
has a workforce of approximately 23,000 and a network of more
than 100 technical centers, sales offices and manufacturing
sites in 17 countries throughout the world.  The Company and its
debtor-affiliates filed for chapter 11 protection on May 17,
2005 (Bankr. E.D. Mich. Case No. 05-55927).  Richard M. Cieri,
Esq., at Kirkland & Ellis LLP, represents C&A in its
restructuring.  Lazard Freres & Co., LLC, provides the Debtor
with investment banking services.  Michael S. Stammer, Esq., at
Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors Committee.  When the Debtors
filed for protection from their creditors, they listed
$3,196,700,000 in total assets and $2,856,600,000 in total
debts.  (Collins & Aikman Bankruptcy News, Issue No. 44;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


COLUMBUS HOSPITAL: Moody's Affirms Rating on $27MM Bonds at B3
--------------------------------------------------------------
Moody's Investors Service has affirmed the B3 underlying rating to
Columbus Hospital's $27 million of Series A (1991) bonds issued by
New Jersey Healthcare Facilities Financing Authority.

The outlook remains negative.

However, management is considering a $10 million borrowing from a
healthcare lender which requires approval by two-thirds of the
bondholders.  Request for such approval has not yet been sought.
Maintenance of the B3 rating will be challenged in the event of
another $10 million obligation.

                         Legal security  

Gross revenue pledge and mortgage. Debt service coverage ratio of
1.1 times which the hospital did not meet in FY 2005.  Debt
service reserve fund remains intact and untapped.

                           Strengths

Proven commitment to monthly funding of debt service obligations
from cash flow and without using the debt service reserve fund
despite a depleted cash position and stressed operations.

                          Challenges

   * Minimal cash position of $3 million, or 12 days cash on
     hand, as of June 30, 2006 although management reports that
     cash has declined to $2.6 million as of August 30, 2006,
     which provides no liquidity cushion to manage operational
     volatility

   * Consideration of a $10 million borrowing to pay vendors,
     enhance certain revenue-producing clinical programs and fund
     needed capital will stress an already overly leveraged
     organization and placing further stress on the hospital's
     ability to make bond payments

   * Material 4.5% decline in volumes in FY 2005 over the prior
     year due to increased physician referrals to Columbus'
     sizable competitor, Clara Maas Medical Center; volumes
     continued to decline 3.4% through the first half of 2006
     over the prior comparable period

                      Recent Developments

Columbus Hospital continues to face significant performance and
liquidity challenges.  FY 2005 results were abysmal with an
$8.4 million operating loss or -9.8% operating margin.  Operating
cash flow and total cash flow were negative and for the second
consecutive year Columbus failed to meet its 1.1 times rate
covenant.  Debt-to-capitalization is extremely unfavorable at 271%
due to the negative adjustment to net assets of $11 million for
prior period adjustments.   

Likewise, $6 million in accounts receivable were written off
(through increased contractual allowances) after consultation with
Columbus' new auditors.  Comparison to prior years' performance is
meaningless given the adjustments taken in FY 2005.  Prior audited
financial statements indicated overstated performance by about
$5 million in both FY 2004 and FY 2003.

Performance through the first half of FY 2006 shows a loss of
$1.1 million which management reports has increased to $2.8
million through August 2006 as volumes continue to decline.
Management is trying to hold FY 2006's loss to $3 million through
cost reductions and volume strategies.   Per the bond documents, a
consultant was hired after Columbus failed to meet its rate
covenant in FY 2004.  The consultant's plan began in June 2005 and
is only one-year into its two-year turnaround plan.  Hence,
Columbus will not have to hire another consultant for the FY 2005
rate covenant violation.  If Columbus reports at least 1.1 times
coverage in FY 2006 it will not need a consultant.

More pertinent to the rating is Columbus's cash position.
Liquidity at FYE 2005 declined to a dangerously low one thousand
dollars (0 days cash on hand) although this was due to a delay in
CMS' PIP (periodic interim payments) funding which came a few days
after the first of the year.  As of June 30, 2006, cash has
increased to $3.1 million (12 days cash) although management
reports that cash has since declined to $2.3 million as of August
30, 2006.  Columbus has no line of credit and is not on C.O.D.
with its vendors.

Notwithstanding Columbus' dire liquidity, the organization remains
current on its monthly bond payments.  Cash flow is used to make
bond payments and payroll.  Columbus has a demonstrated track
record of making all debt payments in full and on time since cash
precipitously declined in FY 2003 to less than $1 million.  After
the Series A bonds, the largest liability is a $17 million payable
to Cathedral Health System, the parent of Columbus Hospital
following the 1999 affiliation.  Payments to the parent are not
currently required but management anticipates making some type of
payment by year end.  No additional cash funding is expected from
Cathedral following the $10 million grant made in 1999.  Cathedral
does not guarantee Columbus' debt and did not make its own rate
covenant in FY 2005.

Management is considering a $10 million borrowing from CIT
healthcare lending but needs two-thirds bondholder approval.  The
loan would be secured by accounts receivable.  Proceeds will be
used to pay vendors, enhance revenue-producing clinical services
and fund capital.  Another $10 million obligation will further
stress demand on already stressed cashflow.

                              Outlook

The negative outlook continues to reflect the highly tenuous
situation caused by the very low level of unrestricted cash
available to Columbus.  Given the depleted asset base, Columbus'
inability to absorb any additional financial challenges severely
compromises bondholders' security.  The negative outlook also
reflects our belief that cash will remain low in the coming years
as the modest cash flow generated will be required to pay debt
service, vendors, and routine capital and operations.

What could change the rating-- up

Unlikely, given current financial position.

What could change the rating-- down

Payment default on debt service, payment or timing concessions
from current bondholders, bankruptcy filing

                         Key indicators

   -- Based on audited financial statements for Columbus Hospital
      ending December 31, 2005

   -- Investment return normalized at 6%

   -- Total hospital admissions: 8,520

   -- Total operating revenue: $ 81.0 million

   -- Net revenues available for debt service: ($3.3) million

   -- Days-cash-on-hand: None

   -- Debt-to-cash flow: (5.92x)

   -- Maximum annual debt service: $3.5 million

Moody's adjusted maximum annual debt service coverage based on 6%
investment return: -0.94 times

Maximum annual debt service coverage based on reported investment
return: -0.94 times

Total debt outstanding: $32.8 million

Operating cash flow margin: -3.8%

Rated debt:

Series A (1991): B3


COMPLETE RETREATS: Gets Court OK to Employ XRoads as Claims Agent
-----------------------------------------------------------------
Pursuant to Sec. 363 of the Bankruptcy Code, the U.S. Bankruptcy
Court for the District of Connecticut gave Complete Retreats LLC
and its debtor-affiliates authority to employ XRoads Claims
Management Services LLC as their claims and noticing agent until
Sept. 30, 2006.

In August 2006, the Debtors filed an application pursuant to
Section 327 of the Bankruptcy Code to employ XCM as their claims
and noticing agent.

The United States Trustee has objected twice to the XCM Retention
Application.

The Debtors voluntarily withdrew the XCM Application after
discussions with their counsel and the U.S. Trustee.

As reported in the Troubled Company Reporter on Oct. 6, 2006, XCM
was expected to:

   (a) assist in the preparation of the Debtors' Schedules of
       Assets and Liabilities, Statements of Financial Affairs,
       the initial reporting package for the United States
       Trustee, and monthly operating reports;

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

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

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

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

       * serving notice to parties-in-interest,

       * maintaining all proofs of claim and proofs of interest
         filed and received in the Debtors' bankruptcy cases;

       * docketing the claims;

       * maintaining and transmitting to the Bankruptcy Clerk the
         official claims registers;

       * maintaining current mailing lists of all claimants and
         notices of appearance received;

       * providing free public access for claims examination at
         its premises during regular business hours; and

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

The Debtors proposed to pay XCM's service at these hourly rates:

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

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

The Debtors also proposed to reimburse XCM for its out-of-pocket
expenses.  XCM has not received a retainer from the Debtors,
Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut,
told the Court.

The Debtors have more than 5,000 creditors and other potential
parties-in-interest.  Mr. Daman avered that the Bankruptcy Clerk's
Office is not equipped to (i) distribute notices, (ii) process
all proofs of claim filed in these cases, and (iii) assist in the
balloting process for the Debtors' Chapter 11 cases.

XCM is not to be retained under Section 327, Mr. Daman noted.  
Accordingly, the Debtors asked the Court to treat XCM's fees and
expenses as an administrative expense under the Debtors' estates.  
The Debtors also asked the Court for permission to pay XCM's fees
and expenses without the need for XCM to file any fee
applications.

John Vander Hooven, a managing director at XRoads Case Management
Services, LLC, assured the Court that XCM does not hold or
represents any interest adverse to the Debtors' estates and is a
"disinterested person," as referenced in Section 327(a) and as
defined in Sections 101(14) and 1107(b) of the Bankruptcy Code.

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


COMPLETE RETREATS: Court Approves First Insurance Premium Pact
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut gave
Complete Retreats LLC and its debtor-affiliates authority to enter
into a premium financing agreement and disclosure statement with
First Insurance Funding Corp.

The Debtors wanted to execute the Premium Finance Agreement and
Disclosure Statement with First Insurance for the financing of
coverage essential for the operation of their business operations,
including umbrella, general liability, and property insurance
policies.

In the ordinary course of business, the Debtors maintain
insurance coverage for themselves and their properties.  To
reduce the burden of funding the premiums of their insurance
policies, the Debtors have in the past routinely entered into
various financing agreements.

Pursuant to the FIFC Premium Finance Agreement, FIFC will provide
financing to the Debtors for the purchase of three Policies:


Policy                                 Effective      Policy
Number      Insurance Company             Date        Premium
------      -----------------          ---------      -------
NHA036341   RSUI Indemnity Company     8/29/2008      $36,000
                                       FIN TXS/FEES         0
                                       ERN TXS/FEES         0

GL000302-02 Aspen Specialty Insurance  8/29/2008       56,330
                                       FIN TXS/FEES     2,906
                                       ERN TXS/FEES     1,800

7522791     Lexington Insurance Co.    8/29/2006      293,149
                                       FIN TXS/FEES    15,032
                                       ERN TXS/FEES     7,500

The premium to be financed pursuant to the Premium Finance
Agreement is $302,563, which is in addition to the $110,154 cash
down payment delivered upon purchase of the Policies.  By virtue
of the Premium Finance Agreement, the Debtors will be obligated
to pay FIFC $313,059, which includes a financing charge of
$10,495 in nine monthly installments of $34,784 each.

The Premium Finance Agreement provides FIFC with various rights
to act against the Policies.

To secure the repayment of the indebtedness due under the Premium
Finance Agreement, the Debtors would grant FIFC a security
interest in, among other things, the unearned premiums of the
Policies.  The Debtors would appoint FIFC as their attorney-in-
fact with the irrevocable power to cancel the Policies and to
collect the unearned premium in the event that they are in
default of their obligations under the Premium Finance Agreement.

To grant adequate protection to FIFC, the parties also agree that
the Debtors would be authorized and directed to timely make all
payments due under the Premium Finance Agreement and FIFC would
be authorized to receive and apply those payments to the
indebtedness owed by the Debtors to FIFC as provided in the
Premium Finance Agreement.

The parties further agree that if the Debtors do not make any of
the payments due under the Premium Finance Agreement as they
become due, the automatic stay would automatically lift and be
vacated to enable FIFC and any insurance companies providing the
coverage under the Policies to take all steps necessary and
appropriate to:

   -- cancel the Policies,
   -- collect the collateral, and
   -- apply that collateral to the indebtedness owed to FIFC by
      the Debtor;

provided that in exercising those rights, FIFC and insurance
companies would be required to comply with the notice and other
relevant provisions of the Premium Finance Agreement.

The Debtors believe that the terms of the Finance Agreement are
commercially fair and reasonable.  Without the Policies, the
Debtors assert they would be forced to cease operations and would
be in default under their postpetition credit agreements.

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


CREDIT SUISSE: S&P Puts Initial 'BB' Ratings to $3.4 Bil. Certs  
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned preliminary ratings to
Credit Suisse First Boston Mortgage Securities Corp.'s
$3.4 billion commercial mortgage pass-through certificates series
2006-TFL2 .

The preliminary ratings are based on information as of Nov. 1,
2006.  Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
     
The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying mortgage loans, and the
geographic and property type diversity of the loans.  Standard &
Poor's analysis determined that, on a weighted average basis, the
trust pool has a debt service coverage of 1.6x based on a weighted
average stressed constant of 10.40%, and a beginning and ending
LTV of 64.9%.

                   Preliminary Ratings Assigned
       Credit Suisse First Boston Mortgage Securities Corp.
   
        Class     Rating     Preliminary   Recommended credit
                              amount ($)       support (%)

         A-1         AAA     1,862,000,000     24.860
         A-2         AAA     621,000,000       24.860
         A-X-1*      AAA     3,304,500,000     N/A
         A-X-2*      AAA     -                 N/A
         A-X-3*      AAA     78,000,000        N/A
         B           AA+     152,000,000       20.260
         C           AA      99,000,000        17.264
         D           AA-     79,000,000        14.874
         E           A+      72,000,000        12.695
         F           A       72,000,000        10.516
         G           A-      71,000,000        8.367
         H           BBB+    52,000,000        6.974
         J           BBB     67,000,000        4.766
         K           BBB-    75,000,000        2.497
         L           BBB-    82,500,000        0.000
         M-SHD**     BB+     21,000,000        N/A
         M-QUN**     BB+     15,000,000        N/A
         M-ARG**     BB       7,000,000        N/A
         M-BEV**     BB+     11,000,000        N/A
         M-NHK**     BB       4,000,000        N/A
         N-SHD**     BB      17,000,000        N/A
         N-ARG**     BB       5,500,000        N/A
         O-SHD**     BB-     16,500,000        N/A
     
*Residual class. **Loan-specific class. N/A--Not applicable.


CWMBS INC: Fitch Affirms Rating on 78 & Upgrades 12 RMBS Classes
----------------------------------------------------------------
Fitch has taken rating actions on these CWMBS (Countrywide Home
Loans), Inc. residential mortgage-backed certificates:

Series 2002-22

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AAA';
     -- Class B1 upgraded to 'AAA' from 'AA';
     -- Class B2 upgraded to 'AA' from 'A';
     -- Class B3 upgraded to 'A' from 'BBB';
     -- Class B4 upgraded to 'BB' from 'B'.

Series 2003-3

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA+';
     -- Class B1 affirmed at 'A+';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-4

     -- Class A affirmed at 'AAA';
     -- Class M upgraded to 'AA+' from 'AA';
     -- Class B1 upgraded to 'A+' from 'A';
     -- Class B2 upgraded to 'BBB+' from 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-7

     -- Class A affirmed at 'AAA';
     -- Class M upgraded to 'AA+' from 'AA';
     -- Class B1 upgraded to 'A+' from 'A';
     -- Class B2 upgraded to 'BBB+' from 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-14

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-18

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-24

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-26

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-28

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-29

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-34

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-39

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-44

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-50

     -- Class A affirmed at 'AAA';
     -- Class M affirmed at 'AA';
     -- Class B1 affirmed at 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

Series 2003-57

     -- Class A affirmed at 'AAA';
     -- Class M upgraded to 'AA+' from 'AA';
     -- Class B1 upgraded to 'A+' from 'A';
     -- Class B2 affirmed at 'BBB';
     -- Class B3 affirmed at 'BB';
     -- Class B4 affirmed at 'B'.

The underlying collateral for all the transactions consists of
conventional, fully amortizing 15- to 30-year fixed-rate mortgage
loans secured by first liens on one- to four-family residential
properties.  The mortgage loans are master serviced by Countrywide
Home Loans, Inc. (rated 'RMS2+' by Fitch).

The affirmations on the above classes reflect adequate
relationships of credit enhancement to future loss expectations
and affect approximately $3.37 billion of the outstanding
certificates.

The upgrades reflect an improvement in the relationship of CE to
future loss expectations and affect $38.19 million of
certificates.  The CE levels for all the upgrade classes have more
than doubled the original enhancement levels since the closing
date.

As of the October 2006 distribution date, the pools are seasoned
from a range of 35 (series 2003-57) to 50 (series 2002-22) months.  
The pool factors (current principal balance as a percentage of
original) range from approximately 10% (series 2002-22) to 64%
(series 2003-39).  The transactions have experienced some or no
loss to date.


DELPHI CORP: Court Approves EDS and HP Outsourcing Agreements
-------------------------------------------------------------
The U.S Bankruptcy Court for the Southern District of New York has
authorized Delphi Corporation and its debtor-affiliates to enter
into and perform under:

   (a) an agreement with Electronic Data Systems Corporation and
       EDS Information Services, LLC, which provides for the  
       outsourcing of global desktops, service desk, and
       mainframe systems hosting; and

   (b) an agreement with Hewlett Packard Company, which provides
       for the outsourcing of server systems hosting.

The Debtors' decision to enter into the IT Infrastructure
Outsourcing Agreements is one step in the implementation of their
transformation plan.  The Debtors intend to transform their
salaried workforce to ensure a competitive structure aligned with
their product portfolio and manufacturing footprint, which would
in turn, lower the Debtors' selling, general, and administrative
expenses.

To achieve this goal, the Debtors are designing and implementing
a shared service delivery model that will contribute to the
reduction of their global SG&A expense by $450 million annually.  
One aspect of this effort is Delphi's accelerated consolidation
and outsourcing of IT functions and the transition to common
processes and systems.  Benchmarking analysis conducted with
independent consultants concluded that Delphi's 2005 IT operating
budget of $588 million could be reduced by $256 million through
three transformation actions:

   (1) outsourcing IT services;

   (2) reducing the number and type of unique, non-common
       systems, moving to common operating platforms; and

   (3) running a streamlined IT shared service organization.

The Debtors' shared service model calls for the outsourcing of
these IT services: (a) global infrastructure services, including
desktops, service desk, and mainframe and server systems hosting;
(b) system development, maintenance, and support; and (c) network
services such as data networks and voice services.

Currently, the Debtors purchase IT services from more than 100
regional-based suppliers.  Completion of all three outsourcing
phases would enable rationalization of the supplier-provider base
to fewer than 10 direct suppliers, which will enable the Debtors
to significantly reduce the number of internal employees providing
those services.  After one-time transition costs of $80 million,
net operating savings of $155 million are expected over the seven-
year term of the IT Infrastructure Outsourcing Agreements.

By moving to a model that provides for the outsourcing of IT
infrastructure services to two vendors, the Debtors believe that
they will:

   (a) achieve and sustain a competitive environment in which
       their service providers will provide service at
       competitive prices throughout the term of the agreement;

   (b) be able to develop stronger relationships with their fewer
       service providers;

   (c) reduce their costs through common process, common systems,
       and economies of scale; and

   (d) find providers with innovation and progressive technology.  

Delphi will contract for global infrastructure services for a
seven-year term, with costs between $700 million and $800
million.  Monthly operating expenses and one-time transition
costs will be charged directly or allocated to the Delphi
affiliates which use the services, with 35% of operating and
transition costs being borne by the Debtors and the remaining
costs by non-Debtor affiliates.

The scope of services to be provided under the IT Infrastructure
Outsourcing Agreements includes transition services both at
inception and at termination to ensure a smooth transition from
existing service providers to EDS and HP and also to ensure that
there is no disruption to Delphi's business at the end of the
term.

Each service provider would be required to submit a detailed
transformation plan which identifies principal changes in
technology and deliverables to allow Delphi to work toward
implementing common systems and a more efficient IT services
delivery model and achieve year-over-year price reductions over
the life of the contracts.  

Troy, Mich.-based Delphi Corporation -- http://www.delphi.com/--   
is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology.  The Company's technology and
products are present in more than 75 million vehicles on the road
worldwide.  The Company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtors' balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts.  (Delphi Bankruptcy News, Issue No. 45; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000)


DELPHI CORP: Former Employees Want Funds for Legal Expenses
-----------------------------------------------------------
John Blahnik, Paul Free, Milan Belans, Laura Marion, Peter Janak,
and Cathy Rozanski, former officers and employees of Delphi
Corporation, ask the U.S. Bankruptcy Court for the Southern
District of New York to modify the Human Capital Obligations Order
to require Delphi to comply with the provisions of its Amended and
Restated Bylaws with respect to indemnification and advancement.

The Former Employees have incurred, and continue to incur legal
fees and expenses in response to subpoenas issued by the
Securities and Exchange Commission related to its investigation of
Delphi's accounting practices and adequacy of financial
disclosures.

John Blahnik, Alan Dawes and Paul Free have also incurred legal
expenses in relation to a multi-district litigation alleging
securities fraud, captioned In re Delphi Corp. Securities,
Derivative & ERISA Litigation, MDL No. 1725 (E.D. Mich.).

The legal fees and expenses were incurred by reason of the Former
Employees' work at Delphi.

Before its bankruptcy filing, Delphi had advanced fees and
expenses for the Former Employees' legal representation in
accordance with Section 145(e) of the Delaware General
Corporation Law and its Amended and Restated Bylaws.

Last year, shortly after the Petition Date, the Court authorized
the Debtors to pay Prepetition Wages and Salaries to employees
and independent contractors.  The Court also allowed the Debtors
to pay Prepetition Benefits and continue Maintenance of Human
Capital Benefit Programs in the ordinary course of their
businesses.

The Former Employees complain that the Human Capital Obligations
Order allows Delphi to exercise discretion that is arbitrary,
contrary to the provisions of Delphi's bylaws, contrary to public
policy, and prejudicial to them.  "The Human Capital Obligations
Order improperly interferes with the advancement of attorneys'
fees in violation of [our] constitutional rights," the Former
Employees add.

The Former Employees relate that they were not given notice of
the Human Capital Obligations Motion.  Thus, they assert, the
Human Capital Obligations Order cannot be accorded finality with
respect to them, and they are entitled to be heard with respect
to their objections to the Human Capital Obligations Motion and
the related Order.

Richard A. Rossman, Esq., and Matthew J. Lund, Esq., at Pepper
Hamilton LLP, in Detroit, Michigan, represent Paul Free.

Thomas W. Cranmer, Esq., at Miller Canfield Paddock & Stone PLC,
in Troy, Michigan, represent John Blahnik and Peter Janak.

William A. Sankbeil, Esq., at Kerr, Russell & Weber PLC, in
Detroit, Michigan, also represent John Blahnik.

Martin E. Crandall, Esq., at Clark Hill PLC, in Detroit,
Michigan, represent Milan Belans.

Christopher A. Andreoff, Esq., at Jaffe, Raitt, Heuer & Weiss PC,
in Southfield, Michigan, represent Laura Marion.

David Dumouchel, Esq., and Laurie J. Michelson, Esq., at Butzel
Long PC, in Detroit, Michigan, represent Cathy Rozanski.

Troy, Mich.-based Delphi Corporation -- http://www.delphi.com/--   
is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology.  The Company's technology and
products are present in more than 75 million vehicles on the road
worldwide.  The Company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtors' balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts.  (Delphi Bankruptcy News, Issue No. 45; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000)


DORAL FINANCIAL: Aims to Boost Returns & Refinance $625 Mil. Debt
-----------------------------------------------------------------
Glen Wakeman, the chief executive officer of Doral Financial
Corp., said in a conference call that the firm will concentrate on
increasing returns and refinancing a $625 million debt, which
matures in July 2007, to recover from a difficult situation.

Mr. Wakeman told Business News Americas, "Our focus will shift
from market share-driven to returns-driven.  We have not and will
not abandon the mortgage or construction lending space.  
Refinancing this debt is my top priority.  We will need outside
financing or other sources of capital to repay this debt at
maturity... such as issuing junk debt, the sale of assets and the
issuance of additional equity securities."

According to BNamericas, Mr. Wakeman praised Doral Financial's
substantial progress in correcting legacy issues and acknowledged
that the firm will continue to experience margin compression for
the foreseeable future due to its balance sheet structure.

Mr. Wakeman told BNamericas, "Our loan volumes are down and our
margins have fallen over 130 basis points since 2004."

Doral Financial's loan production dropped 50% to $1.4 billion in
the first half of 2006.  Its market share decreased to around 10%,
BNamericas states.

Doral Financial Corporation (NYSE: DRL)
-- http://www.doralfinancial.com/-- a financial holding company,  
is a residential mortgage lender in Puerto Rico, and the parent
company of Doral Bank, a Puerto Rico based commercial bank, Doral
Securities, a Puerto Rico based investment banking and
institutional brokerage firm, Doral Insurance Agency, Inc. and
Doral Bank FSB, a federal savings bank based in New York City.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 31, 2006,
Standard & Poor's Ratings Services removed from CreditWatch and
affirmed its ratings on Doral Financial Corp., including its 'B+'
counterparty rating.  The ratings were placed on CreditWatch with
negative implications on April 19, 2005.  The outlook is negative.


DORAL FINANCIAL: Names Marangal Domingo as Chief Financial Officer
------------------------------------------------------------------
Doral Financial Corporation disclosed that Marangal Domingo, who
recently joined Doral bringing more than 20 years of experience in
finance in the financial services industry, has been named chief
financial officer of the Company, replacing Lidio Soriano, who has
resigned.  In becoming chief financial officer, Mr. Domingo also
will continue as Doral Financial Corporation's treasurer and chief
investment officer, positions which he assumed upon joining Doral.

In addition, Doral Financial Corporation announced that Cesar
Ortiz, who has served as Doral's Director of Internal Audit, has
been named the Corporation's comptroller and chief accounting
officer.  In light of this appointment, the Company is undertaking
a search for a new Director of Internal Audit.  Arturo Tous, who
previously served as the chief accounting officer, will remain
with the Company as a senior vice president reporting to the CFO.

Glen Wakeman, chief executive officer, stated, "I am satisfied
that these management appointments will help Doral manage its
financial position, address its balance sheet priorities,
including the refinancing of Doral's $625 million of debt due July
2007, and continue moving Doral forward with its SEC regulatory
filings."

Mr. Domingo has more than 20 years of knowledge, skills and
experience in retail and commercial banking, most recently as
executive Vice President, Finance & Strategy at Countrywide Bank,
N.A. Prior to his tenure at Countrywide, he served as President
and Chief Executive Officer of Downey Financial Corporation in
2004, where he was responsible for strategic direction and
managing day-to-day operations.  Before Downey, Mr. Domingo was
with Washington Mutual, Inc. as Executive Vice President --
Capital Markets, Home Loans & Insurance Services Group from 2001
to 2004 and as Executive Vice President and Chief Financial
Officer -- Home Loans & Insurance Services Group from 1999 to
2001.

Prior to his tenure at the Company, Mr. Ortiz worked with Banco
Santander Puerto Rico as Senior Vice President -- Comptroller from
February to July 2006 and for PricewaterhouseCoopers LLP as an
Audit Senior Manager from November 1997 to February 2006.

Doral Financial Corporation (NYSE: DRL)
-- http://www.doralfinancial.com/-- a financial holding company,  
is a residential mortgage lender in Puerto Rico, and the parent
company of Doral Bank, a Puerto Rico based commercial bank, Doral
Securities, a Puerto Rico based investment banking and
institutional brokerage firm, Doral Insurance Agency, Inc. and
Doral Bank FSB, a federal savings bank based in New York City.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 31, 2006,
Standard & Poor's Ratings Services removed from CreditWatch and
affirmed its ratings on Doral Financial Corp., including its 'B+'
counterparty rating.  The ratings were placed on CreditWatch with
negative implications on April 19, 2005.  The outlook is negative.


DURA AUTOMOTIVE: Ontario Court Recognizes Chapter 11 Case
---------------------------------------------------------
The Ontario Superior Court of Justice, entered a "Foreign
Recognition Order," which recognized under Canadian law the
Chapter 11 bankruptcy proceedings commenced by DURA Automotive
Systems Inc. and its U.S. and Canadian subsidiaries filed in the
United States Bankruptcy Court for the District of Delaware on
Oct. 30, 2006.

DURA's European and other operations outside of the U.S. and
Canada, accounting for approximately 51% of DURA's revenue, are
not part of the Chapter 11 proceedings nor are they part of the
Canadian Court proceedings.  DURA's European and other non-U.S.
and non-Canadian operations therefore remain unaffected by either
orders entered by the U.S. Bankruptcy Court or the Canadian
Court's Foreign Recognition Order.

In the Foreign Recognition Order, the Canadian Court also:

     -- Granted a stay of all proceedings in Canada against DURA
        and its U.S. and Canadian subsidiaries;

     -- Recognized the U.S. Bankruptcy Court's interim order
        authorizing DURA to access up to $50 million of the
        approximately $300 million in Debtor in Possession (DIP)
        financing from Goldman Sachs, GE Capital and Barclays;

     -- Appointed RSM Richter Inc. as Information Officer for
        Canadian stakeholders in respect of DURA's Canadian
        recognition proceedings; and

     -- Recognized all other "first day orders" of the U.S.
        Bankruptcy Court that DURA submitted to the Ontario Court
        for recognition.   

These other first day orders authorize DURA and its U.S. and
Canadian subsidiaries to:

      * Pay employee salaries, wages and benefits that accrued
        prior to the petition filing date;
     
      * Pay certain critical pre petition filing date vendor
        claims and certain claims of vendors whose goods were
        received within the 20 day period prior to the petition
        filing date;

      * Provide "adequate assurance" to utilities in the form of
        a deposit equal to an average of 2 weeks' worth of
        utilities' bills;
     
      * Pay all "trust fund" and similar taxes accruing prior to
        the petition filing date; and

      * Continue using the pre petition cash management system.

DURA and its U.S. and Canadian subsidiaries previously said that
they will be paying, in the ordinary course of business, all post
petition employee, wages, salaries and benefits accruing on and
after the petition filing date.  They will also be paying on a
going forward basis, and in the ordinary course of business, all
vendors and service providers who provide goods and services to
them after the petition filing date.

The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware is presiding over the Chapter 11 proceedings
of Dura and its U.S. and Canadian subsidiaries.  

The Application Record filed in respect of the hearing and the
Foreign Recognition Order will be posted at
http://www.rsmrichter.com/

                   About DURA Automotive Systems

Rochester Hills, Michigan-based DURA Automotive Systems, Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- designs and  
manufactures driver control systems, seating control systems,
glass systems, engineered assemblies, structural door modules and
exterior trim systems for the global automotive industry.  The
company also supplies similar products to the recreation vehicle
and specialty vehicle industries.  

The Debtors filed for chapter 11 protection on October 30, 2006
(U.S. Bankr. Del. Case No: 06-11202).  Daniel J. DeFranceschi,
Esq.., and Jason M. Madron, Esq., at Richards, Layton & Finger,
P.A. represent the Debtors.  No Official Committee of Unsecured
Creditors has been appointed in this case to date.  As of July 2,
2006, the Debtors reported $1,993,178,000 in total assets and
$1,730,758,000 total debts.


EASTON-BELL: Moody's Assigns Loss-Given-Default Ratings
-------------------------------------------------------
In connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology for the U.S. consumer products sector, the rating
agency confirmed its B1 Corporate Family Rating for Easton-Bell
Sports, 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
   ----------           -------  -------  ------   ----------
   $140M senior sub.
   notes due 2012         B3       B3      LGD5        88%

   $70M senior secured
   revolving credit
   facility due 2012      B1       Ba3     LGD3        37%

   $335M senior secured
   term loan due 2012     B1       Ba3     LGD3        37%

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%).

Easton-Bell Sports, Inc., formerly known as Riddell Bell Holdings,
Inc., with executive offices at Irving, Texas, designs, developes
and markets performance enhancing sports equipment as well as
protective equipment and related accessories for athletic and
recreational activities.


ENTERGY NEW: Parent Company Releases Preliminary 3rd Qtr. Results
-----------------------------------------------------------------
Entergy Corporation has indicated that it expects third quarter
2006 as-reported earnings of approximately $1.86 per share and
third quarter operational earnings of approximately $1.83 per
share.  As-reported results, which were $1.65 per share in third
quarter 2005 and included the impact of Hurricanes Katrina and
Rita, are prepared in accordance with generally accepted
accounting principles and are comprised of operational earnings
(described below) and special items.

Third quarter as-reported 2006 earnings will include special items
to reflect the quarterly results of Entergy New Orleans, Inc., and
quarterly results of Entergy's competitive retail business for
remaining transition work associated with the second quarter sale
of this business.  ENOI's results are being reported as a special
item given the uncertainty that remains for this business as it
works toward emerging from bankruptcy.  Competitive retail results
are being reported as a special item given Entergy's 2005 decision
to sell this business.

Third quarter 2006 operational earnings are expected to be higher
compared to third quarter 2005, when Entergy reported operational
earnings of $1.68 per share, due to higher results at Entergy
Nuclear that were partially offset by slightly lower results at
Utility, Parent and Other.

The quarter on quarter decrease in earnings at Utility, Parent and
Other is attributed primarily to:

     * higher operation and maintenance expense
     * higher interest expense
     * lower interest income

Partially offsetting these items were higher revenues due to sales
growth and pricing from previous rate actions and lower income
taxes. Weather was warmer than normal in third quarter 2006 but
comparable to the same period last year.

Entergy Nuclear's higher results are due primarily to:

     * higher energy pricing compared to one year ago

     * a power uprate completed since third quarter 2005 and
       fewer outage days

     * a reduction in the decommissioning liability to reflect
       changes in assumptions on probability of life extension

Partially offsetting these factors was higher operation and
maintenance expense at Entergy Nuclear in third quarter 2006.

Operational results at Entergy's non-nuclear wholesale assets
business are expected to be slightly higher in the current period
compared to third quarter 2005.

Entergy affirmed previously issued as-reported earnings guidance
for 2006 to be in the range of $4.78 to $5.08 per share, and
operational earnings guidance in the range of $4.50 to $4.80 per
share.  Entergy plans to issue 2007 earnings guidance as part of
its third quarter 2006 earnings release.

Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned  
subsidiary of Entergy Corporation.  Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans.  Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004.  Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing.  Entergy New Orleans filed for chapter 11 protection on
Sept. 23, 2005 (Bankr. E.D. La. Case No. 05-17697).  Elizabeth J.
Futrell, Esq., and R. Partick Vance, Esq., at Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., represent the
Debtor in its restructuring efforts.  Carey L. Menasco, Esq.,
Philip Kirkpatrick Jones, Jr., Esq., and Joseph P. Hebert, Esq.,
at Liskow & Lewis, APLC, represent the Official Committee of
Unsecured Creditors.  When the Debtor filed for protection from
its creditors, it listed total assets of $703,197,000 and total
debts of $610,421,000.  (Entergy New Orleans Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


ENTERGY NEW ORLEANS: Can Open Investment Account at Federated
-------------------------------------------------------------
The Hon. Jerry A. Brown of the U.S. Bankruptcy Court for the
Eastern District of Louisiana grants Entergy New Orleans Inc.'s
motion to open an account at Federated Investors Inc.

Judge Brown waives the requirements of Section 345(b) of the
Bankruptcy Code and the U.S. Trustee Guidelines to permit the
opening of the account at Federated Investors.

As reported in the Troubled Company Reporter on Sept. 21, 2006,
the Court authorized ENOI to maintain its existing Cash Management
System.  Entergy Services, Inc., provides, among other things,
accounting and cash management services to ENOI and other Entergy
Corporation affiliates as part of ENOI's cash management system.

Nan Roberts Eitel, Esq., at Jones, Walker, Waechter, Poitevent,
Carrere & Denegre, L.L.P., said that one of the ESI account is
maintained at Federated Investors, which is covered by the Court's
Cash Management Order.  ESI used its Federated Investors account
to invest excess cash that it manages as agent for the Entergy
operating companies from the sale of excess power.

ENOI intended to invest with Federated Investors from $4,000,000
to $30,000,000 on any given day.  The maximum amount that ENOI
would ever have invested at Federated will not exceed $50,000,000,
but ENOI does not reasonably expect to exceed $30,000,000 any
time.

The range of expected return at Federated substantially exceeds
the earnings credit rate for the ENOI general fund account, which
is used principally to set off ENOI's bank fees, Ms. Eitel
averred.  She cited June 2006, when the proposed fund at Federated
earned an average of 4.96%.

Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned  
subsidiary of Entergy Corporation.  Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans.  Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004.  Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing.  Entergy New Orleans filed for chapter 11 protection on
Sept. 23, 2005 (Bankr. E.D. La. Case No. 05-17697).  Elizabeth J.
Futrell, Esq., and R. Partick Vance, Esq., at Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., represent the
Debtor in its restructuring efforts.  Carey L. Menasco, Esq.,
Philip Kirkpatrick Jones, Jr., Esq., and Joseph P. Hebert, Esq.,
at Liskow & Lewis, APLC, represent the Official Committee of
Unsecured Creditors.  When the Debtor filed for protection from
its creditors, it listed total assets of $703,197,000 and total
debts of $610,421,000.  (Entergy New Orleans Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


FEDERAL-MOGUL: Gets Stay on Discovery Propounded by Mt. McKinley
----------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware rules that all discovery propounded
by Mt. McKinley Insurance Company and Everest Reinsurance Co. in
the Chapter 11 cases of Federal-Mogul Corporation -- save for
discovery propounded in connection with ongoing proceedings
concerning Mt. McKinley's request to disqualify Gilbert, Heintz &
Randolph as special insurance counsel to the Debtors -- will be
stayed subject to further Court order, until a date to be set
after the filing of an amended plan of reorganization for the
Debtors.

Mt. McKinley's brief in support of discovery and the Plan
Proponents' reply to that brief, together with all related
pleadings, are adjourned from the Court's consideration at
present, without prejudice to the parties' ability to raise
certain issues addressed by those briefs in connection with the
Plan confirmation.

As reported in the Troubled Company Reporter on May 11, 2006, the
Company and its debtor-affiliates, the Official Committee of
Asbestos Claimants and the Legal Representative for Future
Asbestos Claimants ask the U.S. Bankruptcy Court to issue a
protective order:

    -- extending the time for all parties and third-party
       witnesses to respond or object to all discovery requests,
       deposition notices and subpoenas propounded by Mt. McKinley
       Insurance Company and Everest Reinsurance Company until a
       date to be determined by the Court; and

    -- staying the issuance of further discovery until after the
       Response Date.

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company  
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. 114; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or  
215/945-7000).


FEDERAL-MOGUL: Stipulation of Permissible Objections Gets Court OK
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved a
stipulation among Federal-Mogul Global Inc., T&N Limited, et al.,
the Official Committee of Asbestos Claimants, Professor Eric D.
Green, the duly appointed legal representative for future
asbestos-related personal injury claimants, and certain insurers,
which defines the scope of permissible objections to confirmation
of the Debtors' Third Amended Plan of Reorganization that may be
prosecuted by the Stipulating Insurers.

The Company disclosed that all rights of all non-parties to the
Stipulation are unaffected and preserved for determination as part
of the Plan confirmation process.

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company  
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. 114; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or  
215/945-7000).


FELLOWS ENERGY: Posts $1,392,257 Net Loss in 2006 Second Quarter
----------------------------------------------------------------
Fellows Energy Ltd. reported a $1,392,257 net loss on $282,926 of
revenues for the second quarter ended June 30, 2006, compared with
a $241,395 net loss on zero revenues for the same period in 2005.

At June 30, 2006, the company's balance sheet showed $13,393,945
in total assets, $6,003,554 in total liabilities, and $7,390,391    
in total stockholders equity.  At June 30, 2006, the company's
accumulated deficit has ballooned to $9,508,473.

Full-text copies of the company's second quarter financial
statements are available for free at:
                
                http://researcharchives.com/t/s?1450

                           Going Concern                          

Mendoza Berger & Company, Irvine, Calif., expressed substantial
doubt about Fellows Energy Ltd.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended Dec. 31, 2005.  The auditing firm pointed to the
company's significant operating losses since inception.
                        
                        About Fellows Energy

Incorporated in Nevada on April 9, 2001, Fellows Energy Ltd. was
originally formed to offer business consulting services in the
retail automobile fueling industry. In November, 2003 the company
ceased all activity in the automotive fueling industry and entered
the oil and gas business, focusing on exploration for oil and gas
in the Rocky Mountain Region.  On January 5, 2004, the company
acquired certain interests in certain oil and gas leases and other
interests owned by Diamond Oil & Gas Corporation, a Nevada
corporation. Diamond is wholly owned by George S. Young, Fellows
Energy Ltd.'s CEO.


FOAMEX INTERNATIONAL: Noteholders Panel Balks at DIP Loan Deal
--------------------------------------------------------------
The Ad Hoc Committee of Senior Secured Noteholders previously
complained that rather than undertaking the effort to identify
equity financing on terms most favorable to Foamex International
Inc. and its debtor-affiliates, their creditors and equity
security holders, the Debtors have negotiated exclusively with the
Significant Equityholders since June 8, 2006.

In a separate document, John H. Knight, Esq., at Richards, Layton
& Finger, P.A., in Wilmington, Delaware, points out that the
Significant Equityholders are already highly motivated to provide
the equity financing and subscribe to a Rights Offering in order
to avoid the dilution to their interest that would necessarily
result from a third-party investment or conversion of existing
debt to equity under a plan of reorganization.

However, according to Mr. Knight, there is no evidence that equity
financing was not available to the Debtors on more favorable
terms.

The Senior Noteholders Committee had previously noted that the
structure and terms of the Equity Commitment evidence a
substantial risk that a termination event will occur and that the
Debtors' estates and creditors will be left with the burden of all
of the fees and expenses under the Commitment Letters and arising
from related actions.

Mr. Knight notes that the Equity Commitment requires the Debtors
to file a reorganization consistent with the Term Sheet for
Proposed Chapter 11 Plan of Reorganization annexed to the Equity
Commitment, and prohibits the Debtors from modifying that plan at
any point in the future in a manner that is adverse to the
Significant Equityholders.  If the Debtors do file a modification
-- even one mandated by order of the Court -- in order to afford a
particular creditor group the treatment to which it is entitled
under the Bankruptcy Code or other applicable law, the Significant
Holders can declare a Termination Event and pocket the up to
$9,500,000 Put Option Premium.

Mr. Knight argues that the Put Option Premium and other fees to be
paid to the Significant Equityholders pursuant to the Equity
Commitment are unreasonable and should not be approved.  There is
no need to pay the Significant Equityholders up to $9,500,000 to
provide the Equity Commitment, he contends.

"Were this a [Section] 363 [of the Bankruptcy Code] sale and a
hearing on approval of a 'break-up' fee, under the rationale of
the Third Circuit Court of Appeals in In re O'Brien Environmental
Energy, Inc., 181 F.3d 527, 535 (3d Cir. 1999), the Court would
not approve a break-up fee for the Significant Equityholders
because they have not proven that the Put Option Premium and fees
are actually necessary to preserve the value of the estate,"
Mr. Knight maintains.

In addition, the Debtors had several alternatives available as
paths to emerge from Chapter 11, Mr. Knight points out.  "Here,
the Debtors chose to ignore any alternative other than
negotiations with the Significant Equityholders."

        Creditors Committee Supports Hearing Adjournment

The Official Committee of Unsecured Creditors supports the Senior
Noteholders' Committee's request to adjourn the hearing on the
Debtors' motion to enter into and perform under the Commitment
Letters.

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


FOAMEX INT'L: Financial Projections Under First Amended Plan
------------------------------------------------------------
Foamex International Inc. and its debtor-affiliates' First Amended
Plan of Reorganization includes their financial projections for
the Reorganized Debtors' fiscal years ending December 30, 2007,
December 28, 2008, and January 3, 2010.

The Debtors expect that the Plan's Effective Date is likely to
occur in the first quarter, thus, the Financial Projections assume
an Effective Date of February 25, 2007.

Pursuant to the Equity Commitment Agreement and the First Amended
Plan, to the extent that the Rights Offering generates proceeds of
less than the $150,000,000 Rights Offering Amount, the Significant
Equityholders may exercise their Call Option to purchase all
shares of Additional Common Stock not subscribed and paid for in
full by the holders of the existing common stock as part of the
Rights Offering.

Alternatively, if the Significant Equityholders do not exercise
their Call Option, Foamex International may exercise its Put
Option to sell the new preferred stock to them in an amount equal
to the difference of the Rights Offering Amount less the amount
that Foamex International will receive as a result of the
Equityholders' exercise of rights under the Rights Offering.

The Debtors provide two sets of Financial Projections:

   (a) assuming that either all of the holders of Existing Common
       Stock exercise their Rights or that the Significant
       Equityholders exercise their Call Option to make up any
       shortfall in the amount of proceeds received from the
       Rights Offering; and

   (b) assuming that none of the Existing Common Stockholders
       exercise their Rights and that Foamex International
       exercise the Put Option and sells the New Preferred Stock
       to the Significant Equityholders.

Among others, the Financial Projections assume that total revenue
will increase to:

                  Increase               Year
                  --------               ----
                    8.2%                 2007
                    2.4%                 2008
                    3.5%                 2009

The Debtors expect gross margins will remain relatively constant
at:

               Gross Margin              Year
               ------------              ----
                   13.8%                 2007
                   14.0%                 2008
                   14.5%                 2009

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


FORD MOTOR: Reducing Health Care Benefits of Salaried Employees
---------------------------------------------------------------
Ford Motor Co. plans to reduce expenses for U.S. salaried workers
by abolishing merit-pay raises, requiring bigger payments for
health benefits and reducing health-care payouts for retirees,
Bill Koenig and John Lippert at Bloomberg News report.

The changes will take effect June 1, company spokeswoman Marcey
Evans said in the report.

Ford will require active salaried workers to increase monthly
health-care contributions and pay higher deductibles, Ms. Evans
told Bloomberg.  Specifics will vary because the company offers
those employees five health-care plans, she explained.

Ford also will now provide salaried retirees and their spouses 65
and older $1,800 each for health-care expenses.  The automaker
currently provides the employees company-paid supplemental health
insurance beyond U.S. Medicare benefits.  The affected retirees
can use the $1,800 payments to purchase supplemental insurance,
the source said, citing Ms. Evans.

In addition, Ms. Evans noted that Ford will no longer provide
supplemental health insurance for dependent children of retirees
older than 65.

Ms. Evans also noted that Ford will cut merit-pay increases to
active salaried employees and will reinstate matching contri-
butions for the salaried employee 401(k) retirement plans.

Ford had suspended such matching payments in July 2005.  The
company will pay 60 cents for each dollar employees contribute for
the first 5 percent of a worker's base pay, Bloomberg relates.

                        About Ford Motor

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 Oct. 24, 2006,
Standard & Poor's Ratings Services placed its 'B' senior unsecured
debt issue ratings on Ford Motor Co. on CreditWatch with negative
implications.  At the same time, S&P affirmed all other ratings on
Ford, Ford Motor Credit Co., and related entities, except the
rating on Ford Motor Co. Capital Trust II 6.5% cumulative
convertible trust preferred securities, which was lowered to 'CCC-
' from 'CCC.'

At the same time, Fitch Ratings placed Ford Motor's 'B+/RR3'
senior unsecured debt on Rating Watch Negative reflecting Ford's
intent to raise secured financing that would impair the position
of unsecured debt holders.  Under Fitch's recovery rating scenario
it was estimated that unsecured holders would recover
approximately 68% in a bankruptcy scenario, equating to a Recovery
Rating of 'RR3' (50-70% recovery).

Moody's Investors Service has disclosed that Ford's very weak
third quarter performance, with automotive operations generating a
pre-tax loss of $1.8 billion and a negative operating cash flow of
$3 billion, was consistent with the expectations which led to the
September 19 downgrade of the company's long-term rating to B3.


FORD MOTOR: Shows Improvement in October Sales Figures
------------------------------------------------------
Ford Motor Company's dealers delivered 215,985 vehicles to U.S.
customers in October, up 8 percent compared with a year ago.  It
is the second monthly sales increase for the company, which posted
a 5-percent increase in September.

October car sales were up 22 percent as sales for the company's
new mid- size cars (Ford Fusion, Mercury Milan and Lincoln MKZ)
were more than double a year ago.  The Ford Focus and the outgoing
Ford Taurus also posted sharply higher sales.

Truck sales were up 1 percent, led by gains for the new 2007-model
Expedition and Navigator, which now are on sale in dealerships.

Expedition sales were 8,553 (up 41 percent), and Navigator sales
were 2,066 (up 44 percent).

Ford's F-Series pickup also was up 3 percent, and the Ford
Econoline full- size van was up 31 percent.

October sales for the Ford Escape (9,603) lifted the vehicle's
lifetime sales to more than 1 million.  The Escape has been the
best-selling small utility vehicle in the United States since it
was introduced in late 2000.  Cumulative sales now total
1,001,186.

           U.S. Inventories Lower At the end of October,

Ford, Lincoln and Mercury inventories were estimated at 622,000
units.  This level is 107,000 units lower than a year ago and
30,000 units lower than at the end of September.  The company
estimates three- quarters of the present inventory is new 2007
models.

"We are very serious about aligning inventories with demand," said
Al Giombetti, president, Ford and Lincoln Mercury sales and
marketing.  "Our dealers did an outstanding job with the 2006
model sell-down program, and we took a painful but necessary
action to reduce fourth-quarter production."

                      About Ford Motor

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 Oct. 24, 2006,
Standard & Poor's Ratings Services placed its 'B' senior unsecured
debt issue ratings on Ford Motor Co. on CreditWatch with negative
implications.  At the same time, S&P affirmed all other ratings on
Ford, Ford Motor Credit Co., and related entities, except the
rating on Ford Motor Co. Capital Trust II 6.5% cumulative
convertible trust preferred securities, which was lowered to
'CCC-'from 'CCC.'

At the same time, Fitch Ratings placed Ford Motor's 'B+/RR3'
senior unsecured debt on Rating Watch Negative reflecting Ford's
intent to raise secured financing that would impair the position
of unsecured debt holders.  Under Fitch's recovery rating scenario
it was estimated that unsecured holders would recover
approximately 68% in a bankruptcy scenario, equating to a Recovery
Rating of 'RR3' (50-70% recovery).

Moody's Investors Service has disclosed that Ford's very weak
third quarter performance, with automotive operations generating a
pre-tax loss of $1.8 billion and a negative operating cash flow of
$3 billion, was consistent with the expectations which led to the
September 19 downgrade of the company's long-term rating to B3.


FORMAL INC: Case Summary & Largest Unsecured Creditor
-----------------------------------------------------
Debtor: Formal, Inc.
        1000 Route 213
        Kingston, NY 12401

Bankruptcy Case No.: 06-12934

Type of Business: The Debtor leases real property for marinas.

Chapter 11 Petition Date: November 1, 2006

Court: Northern District of New York (Albany)

Judge: Robert E. Littlefield Jr.

Debtor's Counsel: Richard L. Weisz, Esq.
                  Hodgson Russ LLP
                  677 Broadway
                  Albany, NY 12207
                  Tel: (518) 465-2333
                  Fax: (518) 465-1567

Total Assets: $1,051,300

Total Debts:  $372,662

Debtor's Largest Unsecured Creditor:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
NYS Department of Taxation &  Corporate Franchise           $250
Finance                       Taxes
Tax Compliance Division
W.A. Harriman State Campus
Albany, NY 12227


GERDAU AMERISTEEL: Completes $104 Mil. West Coast Joint Venture
---------------------------------------------------------------
Gerdau Ameristeel has completed the acquisition of a controlling
interest in a newly formed joint venture with Pacific Coast Steel,
Inc. and Bay Area Reinforcing.  

The venture, to be called Pacific Coast Steel, comprises one of
the country's largest reinforcing steel contractors, specializing
in the fabrication and installation of reinforcing steel products
across a variety of construction projects throughout California
and Nevada.  It has in excess of 1,000 employees, including over
800 field ironworkers.  Additionally, the venture operates four
rebar fabrication facilities in California, including San Diego,
San Bernardino, Fairfield, and Napa, with a combined capacity in
excess of 200,000 tons per year.

The purchase price for the interest in Pacific Coast Steel was
approximately $104 million in cash.  Gerdau Ameristeel funded the
transaction with available cash on hand.

                     About Gerdau Ameristeel

Gerdau Ameristeel -- http://www.gerdauameristeel.com/-- is the  
second largest minimill steel producer in North America with
annual manufacturing capacity of over 9 million tons of mill
finished steel products.  Through its vertically integrated
network of 17 minimills (including one 50%-owned minimill), 17
scrap recycling facilities and 46 downstream operations, Gerdau
Ameristeel primarily serves customers in the eastern two-thirds of
North America.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 18, 2006,
Moody's Investors Service's confirmed its Ba2 Corporate Family
Rating for Gerdau Ameristeel Corporation and its Ba3 rating on the
Company's $450 million issue of 10.375% guaranteed senior
unsecured global notes due 2011.  Moody's also assigned an LGD5
rating to those loans, suggesting noteholders will experience a
83% loss in the event of a default.


GULF ATLANTIC: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Gulf Atlantic Operations, LLC
        921 North Chaparral Street, Suite 111
        Corpus Christi, TX 78401

Bankruptcy Case No.: 06-20676

Debtor-affiliates filing separate chapter 11 petitions:

      Entity                                 Case No.
      ------                                 --------
      Gulf Atlantic Terminalling, LLC        06-20677
      Gulf Atlantic Marine, LLC              06-20678
      Patriot Asphalt, LLC                   06-20679

Chapter 11 Petition Date: November 1, 2006

Court: Southern District of Texas (Corpus Christi)

Debtors' Counsel: Nathaniel Peter Holzer, Esq.
                  Jordan Hyden Womble Culbreth & Holzer P.C.
                  500 North Shoreline Drive, Suite 900
                  Corpus Christi, TX 78471
                  Tel: (361) 884-5678
                  Fax: (361) 888-5555

Debtors' Chief
Restructuring
Officer:          K. Scott Van Meter

Debtors'
Financial
Advisor:          Aon Consulting, Inc.
                  200 East Randolph Street
                  Chicago, IL 60601
                  http://www.aon.com/

                           Estimated Assets     Estimated Debts
                           ----------------     ---------------
      Gulf Atlantic        $1 Million to        $1 Million to
      Operations, LLC      $100 Million         $100 Million

      Gulf Atlantic        Less than $10,000    $100,000 to
      Terminalling, LLC                         $1 Million

      Gulf Atlantic        Less than $10,000    Less than $10,000
      Marine, LLC

      Patriot              Less than $10,000    Less than $10,000
      Asphalt, LLC

The Debtors did not file a list of their 20 largest unsecured
creditors.


HERBST GAMING: MGM Deal Cues Moody's to Hold Rating at B1
---------------------------------------------------------
Moody's Investors Service confirmed the ratings of Herbst Gaming,
Inc. after the announcement that the company entered into an
agreement with MGM MIRAGE whereby MGM MIRAGE will sell its Buffalo
Bill's, Primm Valley and Whiskey Pete's hotel-casinos located in
Primm, Nevada, to Herbst for $400 million.

Ratings confirmed include Herbst's B1 corporate family rating and
B1 PDR, along with its Ba1/LGD2 senior secured credit facilities
and B3/LGD5 senior subordinated debt.

A stable ratings outlook was assigned.

Prior to this confirmation, Herbst's ratings were on review for
possible upgrade since May 19, 2006 in consideration of the fact
that the company has been mapping to a higher rating category
according to the risk factors and metrics outlined in Moody's
Global Gaming Methodology.  

However, this recent acquisition announcement combined with the
pending acquisition of The Sands Regent, and assumption that both
acquisitions will be entirely debt financed, will result in
leverage, coverage and profitability measures that will likely
remain consistent with the company's current rating.

Pro forma debt/EBITDA is about 6 (over 7x on a lease adjusted
basis), and not expected to improve materially over the next
18-24 month period.  Longer-term, however, ratings improvement is
possible given the company's increased asset size and continued
low regulatory risk profile.  Debt/EBITDA improvement to
approximately 5x could result in an upgrade.  

Although Moody's expects that both acquisitions will be funded
with debt, no specific financing plan has been announced.   It is
important to note that while Herbst's B1 corporate family rating
will not be impacted by the ultimate financing plan, its secured
bank loan rating could be negatively impacted by up to 2 notches
depending on how much of additional first lien debt is used to
fund the acquisitions.

The Primm transaction which is expected to close by the end of the
first quarter 2007, is subject to customary closing conditions
contained in the purchase agreement, including receipt of
necessary regulatory and governmental approvals.  The $150 million
Sands Regent acquisition is expected to close by the end of 2006.

Moody's most recent action on Herbst occurred on September 28,
2006 when Probability of Default ratings and LGD assessments were
assigned to the company as part of the general roll-out of the LGD
product.

Herbst Gaming, Inc. is an established slot route operator in
Nevada with over 8,400 slot machines and currently owns and
operates eight casinos in Nevada, Missouri and Iowa.  Net revenues
for the latest 12-month period ended June 30, 2006 were $587
million.


HOME PRODUCTS: 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. consumer products sector, the rating
agency confirmed its Caa1 Corporate Family Rating for Home
Products International, Inc. and upgraded its Caa3 rating to Caa2
on the company's $116 million senior subordinated notes due 2008.  
Additionally, Moody's assigned an LGD5 rating to those bonds,
suggesting noteholders will experience a 73% 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%).

Home Products International, Inc. -- http://www.hpii.com/and  
http://www.homz.biz/-- is an international consumer products  
company which designs and manufactures houseware products.  The
Company sells its products through national and regional
discounters including Kmart, Wal-Mart and Target, hardware/home
centers, food/drug stores, juvenile stores and specialty stores.


ITIS HOLDINGS: Cootes Drive Sues Hunter M.A. Carr & Joanne Hoover
-----------------------------------------------------------------
Cootes Drive, LLC, a fund advised by Southridge Capital Management
LLC, has filed suit against Hunter M.A. Carr and Joanne Hoover,
officers of ITIS Holdings, Inc., in the state district court in
Texas.

The Company alleged that Mr. Carr and Ms. Hoover breached
fiduciary duties they owed to the Company and other creditors of
ITIS Holdings by causing ITIS Holdings to liquidate its remaining
assets and to distribute the proceeds to its officers and
directors, including Mr. Carr, in an attempt to shield the assets
from creditors.  In addition, the Company alleges that numerous
payments received by Mr. Carr during the past several years were
fraudulent conveyances made with the intent to hinder the Company
and other creditors.  The Company seeks damages from Mr. Carr and
Ms. Hoover in excess of $2 million.

The Company also disclosed that its claim against ITIS Holdings
arose from its status as a creditor, as confirmed by an order
entered by the United States District Court for the Southern
District of New York finding ITIS Holdings liable for breach of a
Convertible Preferred Stock Purchase Agreement between ITIS
Holdings and the Company and for non-payment of a promissory note
in favor of the Company.  The Company anticipates the court to
enter a final judgment in favor of the Company in an amount in
excess of $3 million.

                        About Southridge

Southridge Capital Management LLC's advised funds have provided
over $1 billion in growth capital to emerging companies globally.
Southridge is committed to funding mid to micro-cap companies with
robust business models across diverse industries.

                    About ITIS Holdings Inc.

ITIS Inc. was originally incorporated in Idaho in 1967 was
reincorporated in Delaware and the corporate name was changed to
Planet Resources, Inc.  On September 18, 2002, ITIS Inc., merged
into its wholly owned subsidiary, ITIS Holdings Inc., with ITIS
Holdings Inc. as the surviving corporation.  The Company provides
management and marketing services to third party companies.

                     Going Concern Doubt

Malone & Bailey, PC expressed substantial doubt about ITIS
Holdings Inc.'s ability to continue as a going concern after
auditing the Company's financial statements for the years ended
December 31, 2005 and 2004.  The auditing firm pointed to the
Company's equity deficit of $6.3 million at December 31, 2005 and
net losses incurred of $137,692 and $1,077,422 during 2005 and
2004, respectively.


IVI COMMS: Posts $110,702 Net Loss in Quarter Ended June 30
-----------------------------------------------------------
IVI Communications Inc. reported a $110,702 net loss on $662,123
of revenues for the first fiscal quarter ended June 30, 2006,
compared with a $1,008,221 net loss on $777,836 of revenues for
the same period in 2005.

At June 30, 2006, the company's balance sheet showed $4,851,650 in
total assets and $6,086,749 in total liabilities, resulting in a
$1,235,099 stockholders' deficit.

The company's balance sheet at June 30, 2006, also showed strained
liquidity with $654,338 in total current assets available to pay
$5,700,845 in total current liabilities.

Full-text copies of the company's first fiscal quarter financial
statements are available for free at:

                http://researcharchives.com/t/s?1448

                          Going Concern

Bagel, Josephs, Levine & Company, LLC, in Gibbsboro, New Jersey,
raised substantial doubt about IVI Communications Inc.'s ability
to continue as a going concern after auditing the company's
consolidated financial statements for the year ended Mar. 31,
2006.  The auditor pointed to the company's operating losses and
capital deficits.

                     About IVI Communications

IVI Communications, Inc. -- http://www.ivn.net/-- acquires,   
consolidates and profitably operates locally branded ISPs to offer
state of the art dialup and fixed wireless broadband Internet
access and other services such as VoIP Internet Telephony to
residential and business customers.

IVI has three wholly owned subsidiaries, Internet Business
Consulting, Inc., Futura, Inc., and AppState.Net.  IBC is a VoIP
services provider and a source of turnkey wireless networks that
has the expertise required to engineer, install, and support
wireless applications and solutions.  Futura, founded in September
1995, is a regional Internet Service Provider serving dialup, DSL
and VoIP in communities surrounding Little Rock, Arkansas.
AppState.net is an Internet Service Provider founded in July 1999
providing wireless and dialup Internet access to the Appalachian
State University town of Boone, NC.


K2 INC: Moody's Assigns Loss-Given-Default Rating
-------------------------------------------------
In connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology for the U.S. consumer products sector, the rating
agency confirmed its Ba3 Corporate Family Rating for K2 Inc., and
its B1 rating on the company's $200M senior unsecured notes due
2014.  Additionally, Moody's assigned an LGD4 rating to those
bonds, suggesting noteholders will experience a 61% loss in the
event of a default.  

Moody's explains that current long-term credit ratings are
opinions about expected credit loss, which incorporate both the
likelihood of default and the expected loss in the event of
default.  The LGD rating methodology will disaggregate these two
key assessments in long-term ratings.  The LGD rating methodology
will also enhance the consistency in Moody's notching practices
across industries and will improve the transparency and accuracy
of Moody's ratings as Moody's research has shown that credit
losses on bank loans have tended to be lower than those for
similarly rated bonds.

Probability-of-default ratings are assigned only to issuers, not
specific debt instruments, and use the standard Moody's
alpha-numeric scale.  They express Moody's opinion of the
likelihood that any entity within a corporate family will default
on any of its debt obligations.

Loss-given-default assessments are assigned to individual rated
debt issues -- loans, bonds, and preferred stock.  Moody's opinion
of expected loss are expressed as a percent of principal and
accrued interest at the resolution of the default, with
assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to
LGD6 (loss anticipated to be 90% to 100%).

K2 Inc. (NYSE: KTO) is a premier, branded consumer products
company with a portfolio of brands including Shakespeare(R),
Pflueger(R) and Stearns(R) in the Marine and Outdoor segment;
Rawlings(R), Worth(R), K2 Licensed Products and Brass Eagle(R) in
the Team Sports segment; K2(R), Volkl (R), Marker(R) and Ride(R)
in the Action Sports segment; and Adio(R), Marmot(R) and Ex
Officio(R) in the Apparel and Footwear segment.  K2's diversified
mix of products is used primarily in team and individual sports
activities such as fishing, watersports activities, baseball,
softball, alpine skiing, snowboarding and in-line skating.  Among
K2's other branded products are Hodgman(R) waders, Miken(R)
softball bats, Tubbs(R) and Atlas(R) snowshoes, JT(R) and Worr
Games(R) paintball products, Planet Earth(R) apparel and
Sospenders(R) personal floatation devices.

Adio(R), Atlas(R), Brass Eagle(R), Ex Officio(R), Hodgman(R),
JT(R), K2(R), Marker(R), Marmot(R), Pflueger(R), Planet Earth(R),
Rawlings(R), Ride(R), Shakespeare(R), Sospenders(R), Stearns(R),
Tubbs(R), Volkl(R), Worth(R) and Worr Games(R) are trademarks or
registered trademarks of K2 Inc. or its subsidiaries in the United
States or other countries.


KAISER ALUMINUM: Reports 3rd Qtr. Claim Settlement Fund & Escrow
----------------------------------------------------------------
Kaiser Aluminum & Chemical Corporation's Tort Claims Settlement
Fund reports $9,520 in total investments for the quarter ended
Sept. 30, 2006.

For the period July 1 through Sept. 30, 2006, the Tort Claims
Settlement Fund made cash disbursements totaling $15,372,704.  It
held $124,398 in principal cash as of September 30.

Kaiser's Asbestos Claim Settlement Escrow reports $10,638 in total
investments for the quarter ending Sept. 30, 2006.

The Asbestos Claim Settlement Escrow made cash disbursements
totaling $17,086,665 in the third quarter, and held $751,366 in
principal cash as of Sept. 30, 2006.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
Feb. 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts.  Lazard Freres & Co. serves as the Debtors'
financial advisor.  Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.  
The Debtors' Chapter 11 Plan became effective on July 6, 2006.  On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts.  (Kaiser Bankruptcy News, Issue No. 107;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 609/392-0900)


KAISER ALUMINUM: Settles OCP Status of Fleishman and Hewitt
-----------------------------------------------------------
Kaiser Aluminum Corporation employed the two firms as ordinary
course professionals during its Chapter 11 cases:

   (a) Fleishman-Hillard, Inc., assisted Kaiser with public
       relations matters; and

   (b) Hewitt Associates LLC acted as the enrolled actuary for
       Kaiser's defined benefit pension plans and was also
       employed to provide other services, including assisting in
       the development of a post-emergence management equity
       incentive plan.

During the six-month period February 1, 2006 through July 5,
2006, Fleishman and Hewitt were paid fees that exceeded the
$210,000 limit imposed by the U.S. Bankruptcy Court for the
District of Delaware on ordinary course professionals.  
Specifically, Kaiser paid Fleishman fees of $315,911 and Hewitt
fees of $363,507.

Kaiser, and Kelly Beaudin Stapleton, the U.S. Trustee for the
District of Delaware, have agreed that despite the terms of the
Court order governing the employment of ordinary course
professionals:

   (1) Kaiser should not have to seek a Court order approving the
       employments of Fleishman and Hewitt under Section 327 of
       the Bankruptcy Code; and

   (2) Kaiser is permitted to pay Fleishman and Hewitt as
       ordinary course professionals.

Judge Fitzgerald approved the stipulation on October 13, 2006.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
Feb. 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts.  Lazard Freres & Co. serves as the Debtors'
financial advisor.  Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.  
The Debtors' Chapter 11 Plan became effective on July 6, 2006.  On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts.  (Kaiser Bankruptcy News, Issue No. 107;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 609/392-0900)


KARA HOMES: Gets Court Approval to Sell Nine Homes
--------------------------------------------------
The Hon. Michael B. Kaplan of the U.S. Bankruptcy Court for the
District of New Jersey gave Kara Homes Inc. permission to proceed
with the sale and closing of nine homes, the Asbury Park Press
reports.

David P. Willis, writing for Asbury Park, says the Company had
hoped to restart construction of up to 300 homes, but its lawyer,
David L. Bruck, Esq., said the short-term financing to get the
Company started had not materialized.  Reports say negotiations
for new financing are ongoing, and Kara officials are hopeful that
a new deal would be in place.

Prior to its chapter 11 filing, Kara said it had lined up a
$5 million financing to start rebuilding and meeting its payroll
for about 70 employees still working for the Company.  It also
wanted to reimburse customers who had canceled their new home
contracts before it filed for bankruptcy.

                        About Kara Homes

Headquartered in East Brunswick, New Jersey, Kara Homes, Inc., aka
Kara Homes Development LLC, builds single-family homes,
condominiums, town homes, 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.

On Oct. 9, 2006, nine affiliates filed separate chapter 11
petitions in the same Bankruptcy Court.  On Oct. 10, 2006, 12 more
affiliates filed chapter 11 petitions.

Kara Homes' exclusive period to file a chapter 11 plan expires
on Feb. 2, 2007.


KOPPERS HOLDINGS: Dr. Whittle to Retire as Europe General Manager
-----------------------------------------------------------------
Koppers Holdings Inc., disclosed that Dr. David Whittle, vice
president and general manager, European Operations, will be
retiring effective March 31, 2007.

The Company said that Dr. Whittle has been responsible for
European operations since the Company acquired 100% ownership of
Tarconord A/S, now known as Koppers Europe, in May 2000.

The Company concurrently disclosed the appointment of James T.
Dietz to replace Dr. Whittle effective March 31, 2007.  Mr. Dietz
has more than 21 years of experience in the coal tar distillation
business, with a background in engineering and operations.
Mr. Dietz is currently operations manager for Koppers' North
American Carbon Materials & Chemicals business.  In his new
capacity, Mr. Dietz will report to Kevin J. Fitzgerald, who was
named senior vice president, Global Carbon Materials & Chemicals.

Koppers Holdings Inc., (NYSE: KOP) -- http://www.koppers.com/--  
with corporate headquarters and a research center in Pittsburgh,
Pennsylvania, is an integrated producer of carbon compounds and
treated wood products.  Including its joint ventures, Koppers
operates facilities in the United States, United Kingdom, Denmark,
Australia, China, the Pacific Rim and South Africa.

                         *     *     *

Koppers Holdings Inc.'s balance sheet at June 30, 2006 showed
total assets of $625 million and total liabilities of $733 million
resulting in a total stockholders' deficit of $108 million.  Total
stockholders' deficit at Dec. 31, 2005 stood at $206 million.


LE-NATURE'S INC: Creditors File Bankruptcy Case in Pennsylvania
---------------------------------------------------------------
General Press Corp., Lyons Contracting Inc., M.I. Friday Inc., and
Jackel Development Inc. have filed a chapter 7 petition with the
United States Bankruptcy Court in Pennsylvania for Le-Nature's
Inc., fka Global Beverage Systems Inc., saying the company owes
them more than $1.4 million, the Associated Press reports.

The move follows the appointment of Kroll Zolfo Cooper LLC, as
custodian of Le Nature's after a Delaware judge concluded the
Company had engaged in potentially criminal activity, the source
said, citing court documents.

The turnaround firm, according to the report, has submitted an
emergency motion in Delaware to borrow up to $10 million and seek
Chapter 11 protection.

An attorney for the creditors, David K. Rudov, told the Associated
Press that he wanted to ensure the anticipated bankruptcy
proceedings take place in western Pennsylvania, where many
creditors are located, rather than in Delaware.

"The doors are going to remain open," Mr. Rudov said in the
report, adding that the company may operate under new ownership in
the future.  "The company's going to continue to make beverages.
This is just an issue of how everyone's going to get paid."

Steven G. Panagos, a Kroll Zolfo Cooper managing director, has
arrived in Latrobe to take control of the company while four Le-
Nature executives were relieved of their duties and ordered by the
Court of Chancery in Delaware to turn over all company property
within 48 hours, AP relates.

The court had also issued a temporary restraining order on Oct. 20
prohibiting company directors from accessing, tampering with or
destroying company property, books or records, AP notes.

Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. makes
bottled waters, teas, juices and nutritional drinks.  Its brands
include Kettle Brewed Ice Teas, Dazzler fruit juice drinks and
lemonade, and AquaAde vitamin-enriched water.


LE-NATURE'S INC: Involuntary Chapter 7 Case Summary
---------------------------------------------------
Alleged Debtor: Le-Nature's
                fka Global Beverage Systems, Inc.
                11 Lloyd Avenue
                Latrobe, PA 15650

Involuntary Petition Date: November 1, 2006

Case Number: 06-25454

Chapter: 7

Court: Western District of Pennsylvania (Pittsburgh)

Judge: M. Bruce McCullough

Petitioners' Counsel: David K. Rudov, Esq.
                      Rudov & Stein, P.C.
                      First and Market Building
                      100 First Avenue, Suite 500
                      Pittsburgh, PA 15222
                      Tel: (412) 281-7300
                      Fax: (412) 281-7305
         

    Petitioners                 Nature of Claim     Claim Amount
    -----------                 ---------------     ------------
General Press Corp.             Trade Claim           $1,067,456
110 Allegheny Drive  
Natrona Heights, PA 15065

M.I. Friday, Inc.               Trade Claim             $180,000
150 Perrysville Avenue
Pittsburgh, PA 15229

Lyons Contracting, Inc.         Trade Claim              $97,971
4101 Route 993
North Huntingdon, PA 15642

Jackel Development, Inc.        Trade Claim              $96,027
13030 Veronica Lane
North Huntingdon, PA 15642


LE-NATURE'S: Moody's Sees Ratings Withdrawal After Bankr. Filing
----------------------------------------------------------------
Moody's Investors Service lowered the ratings which were on review
for downgrade on Le-Nature's Inc. and will withdraw all ratings
because an involuntary petition for bankruptcy was filed under
Chapter 7 of the bankruptcy code.

Ratings lowered and to be withdrawn:

   -- Corporate Family Rating -- to C from Caa1

   -- Bank Facility Ratings -- to Ca (LGD 5, 77% LGD Rate) from
      B2 (LGD 2, 27% LGD rate)

   -- $150 million senior subordinated notes -- to C (LGD 6,
      100%) from Caa2 (LGD 5, 81% LGD rate)

   -- Probability of Default rating to D from Caa1

Le-Nature's, Inc. with headquarters in Latrobe, Pennsylvania makes
water, juices, teas and other-non-carbonated beverages.


LOGANS ROADHOUSE: Moody's Assigns B2 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service assigned a first-time B2 corporate
family rating to Logan's Roadhouse, Inc. along with Ba3 ratings
for the proposed senior secured credit facilities.  

Proceeds from the newly rated debt together with senior
subordinated notes not rated by Moody's and contributed equity
will fund the acquisition of Logan's by two private equity
sponsors, Bruckmann, Rosser, Sherrill & Co. and Canyon Capital
Advisors LLC and affiliates from CBRL Group, Inc.  CBRL, the
operator of Cracker Barrel Restaurants, elected to monetize its
investment in Logan's after concluding a strategic review that was
initiated in the fall of 2005.  These assigned ratings are subject
to review of final documentation.

The rating outlook is stable.

The B2 corporate family rating reflects high financial leverage
and modest free cash flow generation, limited scale and scope,
operating within the highly competitive casual dining segment of
the restaurant industry and the challenges associated with
operating independently of CBRL.  The rating acknowledges Logan's
track record for performance, potential for unit and operating
margin growth and loyal customer base that results in more
frequent visits, consistent average unit volumes and allows the
company to spend considerably less than its peers on marketing
initiatives.

Ratings assigned with a stable outlook:

   -- B2 corporate family rating,

   -- B2 probability of default rating, LGD4-50% loss given
      default assessment,

   -- Ba3 (LGD2, 29%) for the $30 million revolver maturing in
      2011,

   -- Ba3 (LGD2, 29%) for the $138 million term loan B maturing
      in 2012,

Moody's has applied its new Probability-of-Default and Loss-Given-
Default rating methodology to Logan's and its subsidiaries.
Moody's current long-term credit ratings are opinions about
expected credit loss which incorporate both the likelihood of
default and the expected loss in the event of default.  The LGD
rating methodology disaggregates these two key assessments in
long-term ratings.  The LGD rating methodology also enhances the
consistency in Moody's notching practices across industries and
improves the transparency and accuracy of our ratings as our
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 on an individual security
is expressed as a percent of principal and accrued interest at the
resolution of the default, with assessments ranging from LGD1
(loss anticipated to be 0% - 9%) to LGD6 (loss anticipated to be
90% - 100%).  The assignment of ratings to Logan's new capital
structure reflects Moody's new methodology for assigning ratings
to individual securities rather than a change in the
characteristics of any debt security in the company's fundamental
credit profile.

Logan's Roadhouse, Inc., headquartered in Nashville, Tennessee,
operates 143 and franchises 26 traditional American roadhouse-
style steakhouses in twenty states across the country.


LOOMIS SAYLES: Moody's Rates $15MM Class E Notes Due 2020 at Ba2
----------------------------------------------------------------
Moody's Investors Service assigned these ratings to notes issued
by Loomis Sayles CLO I, Ltd., a collateral loan obligation:

   -- Aaa to $296,000,000 Class A Floating Rate Notes, Due 2020

   -- Aa2 to $20,000,000 Class B Floating Rate Notes, Due 2020

   -- A2 to $20,000,000 Class C Deferrable Floating Rate Notes,
      Due 2020

   -- Baa2 to $21,000,000 Class D Deferrable Floating Rate Notes,
      Due 2020

   -- Ba2 to $15,000,000 Class E Deferrable Floating Rate
      Notes, Due 2020

Moody's ratings of the notes address the ultimate cash receipt of
all required interest and principal payments, as provided by the
notes' governing documents, and are based on the expected loss
posed to noteholders, relative to the promise of receiving the
present value of such payments.


MERIDIAN AUTOMOTIVE: Court Extends Foreign Unit Financing Period
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Meridian Automotive Systems Inc. and its debtor-affiliates to
modify the terms of the Foreign Funding Order to:

   (a) extend the time in which they may advance funds to their
       Foreign Subsidiaries to the earlier of:

          (i) the effective date of a plan of reorganization, or

         (ii) June 26, 2007; and

   (b) allow them to reallocate $750,000 of the $8,500,000 that
       was previously allocated to Meridian Mexico to Meridian
       Brazil.

The Debtors previously obtained permission from the Court to
advance up to $9,700,000 to their non-debtor Foreign Subsidiaries
over a 14-month period ending on June 26, 2006.  

As reported in the Troubled Company Reporter on Oct. 17, 2006,
under the terms of the Foreign Funding Order, the Debtors were
authorized to advance:

   -- up to $8,500,000 to Meridian Automotive System, S. de MR.
      de C.V.,

   -- up to $200,000 to Voplex of Canada; and

   -- up to $1,000,000 to Meridian Automotive Systems-DO Brazil
      LTDA.

As of Oct. 5, 2006, the Debtors had advanced approximately
$3,500,000 to the Foreign Subsidiaries pursuant to the Foreign
Funding Order.

The Foreign Subsidiaries generally had been able to generate
positive cash flow from their operations and as a result, the
Debtors had only advanced approximately $3,500,000 to the
Foreign Subsidiaries.  The Debtors, however, required the
continued ability to advance additional funds to the Foreign
Subsidiaries up to the $9,700,000 cap to ensure that the Foreign
Subsidiaries can operate their business without interruption.

It is necessary for the Debtors to continue advancing funds to
their Foreign Subsidiaries to:

   (i) safeguard the Debtors' investment in the Foreign
       Subsidiaries; and

  (ii) ensure that the Foreign Subsidiaries continue to
       manufacture parts that the Debtors use to make end-product
       component parts to sell to OEMs.

The advances are necessary to permit the Foreign Subsidiaries to,
among other things, continue their production and manufacturing
operations.

If the Foreign Subsidiaries ceased operations:

   (i) the value of the Debtors' interest in the Foreign
       Subsidiaries would be significantly reduced;

  (ii) any incremental revenue produced by the Foreign
       Subsidiaries would be eliminated;

(iii) the Debtors' market share in the automotive parts industry
       would be reduced; and

  (iv) the Debtors' relationship with numerous OEM customers
       would be materially and adversely affected.

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. 42;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


MERIDIAN AUTOMOTIVE: Sells Mich. Property to Roskam for $2.45 Mil
-----------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware authorizes Meridian Automotive Systems Inc.
and its debtor-affiliates to sell a parcel of real property
located at 3225 32nd Street Southeast, in Kentwood, Michigan,
referred to as the GR1 Plant to Roskam Baking Company for
$2,450,000, free and clear of all liens, claims and encumbrances,
and pursuant to the terms of the Sale Agreement, as amended on
Oct. 19, 2006.

The Sale Agreement has been amended to include these provisions:

   1. The Due Diligence Period for Roskam to complete the Phase 1
      Review, Title Review and Survey Review is extended for two
      additional weeks.  The new deadline for Roskam to complete
      due diligence is on November 2, 2006.

   2. The Debtors agree to work with Consumers Energy regarding
      the release of the easements that the existing building
      encroaches on the Premises.  In the event the matter cannot
      be resolved by Nov. 2, 2006, the parties agree to enter
      into an Escrow Agreement, whereby $50,000 will be withheld
      from the proceeds of closing to assume Roskam's continued
      work towards the release of the encroached easements.  The
      closing deadline, however, will not be delayed as a result
      of it.

   3. Subject to the satisfaction or waiver of Roskam's remaining
      contingencies, the closing of the sale of the Premises will
      take place on a date mutually agreeable to the parties
      within 10 days of Nov. 2, 2006.

The Court also authorizes the Debtors to pay the commission
earned by real estate broker NAI West Michigan.

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. 42;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


MESABA AVIATION: Opts to Reject Six Engine Leases with GS Leasing
-----------------------------------------------------------------
Mesaba Aviation, Inc. asks the U.S. Bankruptcy for the District of
Minnesota for authority to reject their spare engine leases
effective as of Sept. 27, 2006.  The date coincides with the
expiration of a stipulation providing for extension regarding
aircraft agreements between the parties.

In connection with operating AVRO aircraft, the Debtor leases a
number of spare Avro engines, including six Avro engines with
these engine serial numbers:

    * LF07586,
    * LF07587,
    * LF07636,
    * LF07637,
    * LF07645, and
    * P07726.

In light of the removal AVRO aircraft from the Debtor's fleet,
the spare engines are no longer necessary and beneficial to the
Debtor's operations, according to Will R. Tansey, Esq., at Ravich
Meyer Kirkman McGrath & Nauman, in Minneapolis, Minnesota.

Mr. Tansey relates that the Spare Engines are each leased from GS
Leasing Engines I, LLC, pursuant to leases and related agreements
assigned to GS Leasing I by Banc of America Leasing & Capitol,
LLC.

In the Extended Use Stipulation, Mr. Tansey says, GS Leasing I
agreed to take possession of the Spare Engines from the Debtor's
Minneapolis, Minnesota maintenance facility on October 2, 2006.

The Debtor had obtained authority from the Court to reject leases
related to the seven spare engines leased from GS Leasing.  The
Debtor said that these seven spare engines are the least desirable
Avro engines in the Debtor's possession primarily since GS Leasing
has refused to reduce the rent, among other reasons.

                      GS Leasing II Objects

The week before the end of the Extended Use Stipulation period on
September 27, 2006, GS Leasing Engine II, LLC's consultants
inspected maintenance records relating to the six Avro engines,
and discovered that none of the Spare Engines met the
requirements set forth in the Extended Use Stipulation.

Monica L. Clark, Esq., at Dorsey & Whitney LLP, in Minneapolis,
Minnesota, clarifies that GS Leasing II does not object to the
Debtor's rejection of the Spare Engines, but only to the
retroactive, nunc pro tunc September 27, 2006, rejection date.

Ms. Clark asserts that the effective date of the rejection of
each of the Spare Engine Leases should be effective only after
the Debtor has complied with the requirements for return of the
engines set forth in the Extended Use Stipulation.

Thus, GS Leasing II asks the Court to (a) deny the Debtor's nunc
pro tunc request for a retroactive rejection date, and (b) set
the rejection date on a date when all of the required conditions
for return of each Spare Engines are satisfied by the Debtor.

                       Debtor Answers Back

Mr. Tansey argues that GS Leasing II can provide no legal
precedent or support for the theory that the Debtor may not reject
a lease until it meets return obligations, whether
disputed or acknowledged.

Mr. Tansey asserts that to the extent that GS Leasing II believes
the Debtor has failed to meet contractual obligations, GS Leasing
must make a claim against the Debtor's estate.  However, the
resolution of a claim dispute is unrelated to rejection and
should not bar or delay a rejection ruling from being entered by
the Court.

Mr. Tansey notes that the Debtor has sought and received
retroactive approval of the rejection of leases throughout its
Chapter 11 case without objection.  Denying retroactive approval
now could unduly harm the estate by potentially creating
additional and unnecessary administrative expense claims.

Moreover, Mr. Tansey continues, GS Leasing does not object to
retroactive approval but merely attempts to rely on the law
related to nunc pro tunc approval in an attempt to confuse the
issues and force the Debtor to perform certain return requests.

Accordingly, the Debtor asks the Court to overrule the objection,
and approve its rejection request.

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


MESABA AVIATION: Can Enter Into Master Lease Pact with Northwest
----------------------------------------------------------------
Mesaba Aviation, Inc. obtained authority from the U.S. Bankruptcy
Court for the District of Minnesota to enter into a Master Lease
Agreement with Northwest Airlines, Inc., which provides for the
lease of certain baggage handling equipment by Northwest.

Specifically, the Debtor asked the Court to:

   (a) approve a Master Lease Agreement providing for the lease
       of certain pieces of the Debtor's baggage handling
       equipment by Northwest;

   (b) approve a Master Sublease Agreement pursuant to which
       Northwest will lease back the Equipment to the Debtor; and

   (c) grant an option to purchase the Debtor's property outside
       the ordinary course of business.

In the ordinary course of its operations, the Debtor provides
ground-handling services to Northwest, pursuant to an unwritten
agreement.  The baggage handling equipment is owned by the Debtor,
is essential to the ground-handling services provided by the
Debtor, and is integral to Northwest's flight service operations.

Will R. Tansey, Esq., at Ravich Meyer Kirkman Mcgrath & Nauman,
P.A., in Minneapolis, Minnesota, relates that Northwest has
expressed concern that the Debtor's reorganization puts
Northwest's operations at risk.  Accordingly, the parties entered
into the Master Lease and Sublease to assure Northwest that if
the Debtor is forced to cease ground operations, Northwest will
be able to maintain uninterrupted ground-handling services to its
passengers.

Mr. Tansey notes that the Debtor and Northwest were in
substantial agreement on the terms of the Lease and Sublease, and
have executed both agreements effective October 12, 2006, and
will remain in effect until April 1, 2007, unless earlier
terminated, in whole or in part, in accordance with each
agreement.

The Debtor is attempting to obtain approval of the agreements at
the earliest opportunity, and has filed the Lease and Sublease
with their schedules, which contain the detailed Equipment lists
and the Option and rent prices, Mr. Tansey says.

Among other things, the Master Lease:

    * provides that the Debtor will lease the Equipment to
      Northwest for a monthly base rent of $90,000;

    * grants Northwest an option to purchase the Equipment
      for $4,672,350 in the event, among others, the Debtor (a)
      files a Chapter 11 of the Bankruptcy Code liquidating plan,
      (b) converts its Chapter 11 case to a liquidation under
      Chapter 7 of the Bankruptcy Code, or (c) is unable to
      continue ground handling services; and

    * is terminable at will upon the Debtor's confirmation of a
      plan, other than a liquidating plan.

A full-text copy of the Master Lease is available for free at:

              http://researcharchives.com/t/s?13b6

Among other things, the Sublease:

    * provides that Northwest will sublease the Equipment to
      the Debtor for a monthly base rent of $90,000;

    * is terminable at will upon the Debtor's confirmation of a
      plan, other than a liquidating plan.

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

              http://researcharchives.com/t/s?13b7

Mr. Tansey asserts that the Lease and Sublease help ensure that
the Debtor continues generating revenue from ground handling
services, which revenue is crucial to its organization and its
estate under the current circumstances.

Moreover, if the Debtor is forced to cease operations, the Option
ensures that the Debtor's estate will quickly receive fair market
value for the Equipment while ensuring that Northwest and its
passengers are not unduly burdened.

The Debtor believes that the Option is necessary to maximize the
likelihood of continued ground operations and to minimize risk to
Northwest and its passengers, and the Option price is the current
fair market value of the Equipment.

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


NCO GROUP: Earns $11.4 Million in 2006 Third Quarter
----------------------------------------------------
NCO Group, Inc., reported net income of $11.4 million, including
special charges of $3.6 million, net of taxes for the third
quarter of 2006.  This compares to net income of $7.6 million in
the third quarter of 2005; including special charges of
$2.2 million, net of taxes.

The special charges are associated with the restructuring of the
Company's legacy operations to streamline the Company's cost
structure, the integration of recent acquisitions, and costs
associated with the Company's proposed merger.  The special
charges for 2005 also included the impact from Hurricane Katrina.
The restructuring charges are included as a separate line item
under operating costs and expenses, and the integration, merger,
and Hurricane Katrina charges are included in payroll and related
expenses, and selling, general and administrative expenses.

NCO is organized into four divisions that include Accounts
Receivable Management North America, Customer Relationship
Management, Portfolio Management, and Accounts Receivable
Management International.

Overall revenue in the third quarter of 2006 was $301.6 million,
an increase of 21.0%, or $52.4 million, from revenue of
$249.2 million in the third quarter of 2005.

For the third quarter of 2006, ARM North America's revenue was
$205.7 million as compared to $186.8 million in the third quarter
of 2005.  The increase was primarily attributable to the
acquisition of Risk Management Alternatives, Inc., which was
completed on Sept. 12, 2005, and an $8.7 million increase in
inter-company revenue from Portfolio Management, which is
eliminated in consolidation.  During the quarter, this division
recorded approximately $3.4 million, net of taxes, of
restructuring charges, costs associated with integration of the
Company's recent acquisitions, and merger costs.

For the third quarter of 2006, CRM's revenue was $62.8 million as
compared to $44.9 million in the third quarter of 2005.  The
increase was primarily attributable to new clients ramping up
business during the end of 2005 and during 2006.  While these new
contracts have allowed this division to expand its revenue base in
2006, the deployment of large numbers of seats on an expedited
schedule adversely impacts near-term profitability because the
operating expenses are incurred in advance of the revenue growth.

Partially offsetting the revenue from new clients in the third
quarter of 2006 was the reduction in revenue from a major client
where NCO ceased providing certain services when the client exited
the consumer long-distance business due to changes in
telecommunications laws.  During the quarter this division
recorded approximately $133,000, net of taxes, of restructuring
and integration charges.

For the third quarter of 2006, Portfolio Management's revenue was
$55.3 million compared to $35.1 million in the third quarter of
2005.  The increase included additional revenue from portfolio
assets acquired as part of two business combinations at the end of
the third quarter of 2005.  Portfolio Management recorded
$13.1 million of revenue during the third quarter of 2006 from the
sale of portions of several older portfolios with little or no
remaining carrying value, as compared to $2.8 million during the
third quarter of 2005.

For the third quarter of 2006, ARM International's revenue was
approximately $8.4 million compared to $3.5 million in the third
quarter of 2005.  The increase in revenue was primarily
attributable to the acquisition of the international operations of
RMA.  During the quarter this division recorded approximately
$80,000, net of taxes, of restructuring and integration charges.

NCO Group, Inc. -- http://www.ncogroup.com/news/-- provides  
business process outsourcing services including accounts
receivable management, customer relationship management and other
services.  NCO provides services through 90 offices in the United
States, Canada, the United Kingdom, Australia, India, the
Philippines, the Caribbean and Panama.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 2, 2006,
Moody's Investors Service assigned a B3 rating to NCO Group,
Inc.'s proposed $165 million senior unsecured notes and a Caa1
rating to its proposed $200 million of senior subordinated notes,
which are intended to replace a proposed $365 million senior
subordinated notes offering that was cancelled.

Concurrently, Moody's withdrew the Caa1 rating assigned to the
discussed $365 million of senior subordinated notes.  Pro-forma
for the aforementioned capital mix changes, Moody's affirmed the
B2 corporate family rating and the Ba3 rating on the $565 million
senior secured credit facility.


NE ENERGY: Fitch Assigns B Issuer Default Rating
------------------------------------------------
Fitch Ratings has assigned an Issuer Default Rating of 'B' to
NE Energy, Inc.  In addition, Fitch has assigned issue ratings of
'BB-/RR2' to NE Energy's first lien credit facilities and 'B-/RR5'
to NE Energy's second lien credit facilities.

The first lien facilities consist of a $550 million term loan due
November 2013, a $65 million cash collateralized synthetic letter
of credit facility due November 2013, and a $70 million revolving
credit facility maturing November 2011.  The second lien facility
consists of a $170 million term loan due May 2014.  The Rating
Outlook is Stable.

NE Energy is a newly formed subsidiary of Energy Capital Partners
I, LP.  The term loans, in addition to approximately $400 million
of equity, will be used to finance the Sponsor's acquisition of
Northeast Utilities' non-regulated generation assets, fund
required liquidity accounts, and pay transaction costs. The
acquired assets consist of Mt Tom, a 146 MW coal fired facility,
and Northeast Generation Company, a portfolio of primarily
hydroelectric facilities totaling 1296 MW.  NGC is currently
encumbered with $320 million of senior secured bonds due 2026
(rated BBB- by Fitch).  The Mt Tom facility is not encumbered with
project-level debt.


NEW YORK RACING: Files for Bankruptcy Protection in Manhattan
-------------------------------------------------------------
The New York Racing Association has filed a voluntary petition
under Chapter 11 of United States Bankruptcy Code with the U.S.
Bankruptcy Court for the Southern District of New York.  NYRA,
owner and operator of Aqueduct Racetrack, Belmont Park, and
Saratoga Race Course, is a private, non-profit racing association
established in 1955.

"We always viewed filing for Chapter 11 bankruptcy protection as a
last option, and regrettably, NYRA's Board of Trustees felt that
we were required to take this action to protect New York's
Thoroughbred racing industry," Charles Hayward, President and CEO
of NYRA said.  "The goal of the filing is to maintain the current
schedule of racing dates, purse structure, stakes program and all
other racing operations.

"Chapter 11 bankruptcy does not mean going out of business," added
Mr. Hayward.  "In fact, it is a constructive process that allows
NYRA the opportunity to achieve financial reorganization while
continuing to conduct world-class Thoroughbred racing without
interruption."

Over the last three years, NYRA brought in new management,
reformed its internal security systems, incorporated state of the
art drug testing programs through the use of race day monitoring
barns, reduced its net loss, increased revenues and decreased
expenses.

Late last year, as a result of these improvements as verified by a
Federal monitor, the State Legislature worked out a $30 million
dollar loan to allow NYRA to meet its obligations until a new
revenue stream could be put into place-the introduction of 4,500
Video Lottery Terminals at Aqueduct Race Track.  Despite state
legislation authorizing gaming at selected racetracks and NYRA's
dire financial situation, the VLTs have never been approved at
Aqueduct, and the State failed to fund $19 million of the loan
that was appropriated for NYRA's use.  Aqueduct is the only NYRA
track included in the VLT legislation.

On Monday, the Non-Profit Racing Association Oversight Board
approved a new resolution that applied further restrictions and
conditions on NYRA's ability to receive the $19 million balance of
the previously approved loan.

"It is unfortunate, and frankly, inexplicable, why the State
Lottery Division could not work out the details necessary to get
the VLT construction underway at Aqueduct;" said C. Steven
Duncker, Chairman of the NYRA Board of Trustees.  "It is all the
more mystifying given the fact that VLTs have been put in
operation at eight non-NYRA tracks around the state," he added.  
"VLTs at Aqueduct represent cash flow to our industry, the
continuation of New York Racing-the premier brand in North
America-and over $400 million per year for the State's budget for
education, $60 million for the Lottery, and $50 million for purses
and breeders awards."

NYRA is the cornerstone of New York's Thoroughbred racing
industry, which provides 17,000 jobs and $1.4 billion in annual
impact on the State's economy, according to a 2005 Deloitte
Consulting study.  NYRA employs 1,170 workers and there are
approximately 1,800 backstretch workers living in 900 NYRA
dormitory rooms.  More than 2,000 horses are currently stabled at
Aqueduct Racetrack and Belmont Park.

Last year, NYRA's Belmont Park and Saratoga Race Course were
ranked first and second, respectively, among all North American
racetracks in average daily purse distribution.  The recently-
concluded Belmont Park fall meeting finished up 6.7% in wagering,
while Saratoga Race Course posted a 4.9% wagering increase and
retained its position as the most popular and successful race
meeting in the nation.


NEW YORK RACING: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: The New York Racing Association Inc.
        aka NYRA
        Aqueduct Race Track
        110-00 Rockaway Boulevard
        Jamaica, NY 11417

Bankruptcy Case No.: 06-12618

Type of Business: The Company operates racing tracks in Aqueduct,
                  Belmont Park and Saratoga.
                  See http://www.nyra.com/

Chapter 11 Petition Date: November 2, 2006

Court: Southern District of New York (Manhattan)

Judge: James M. Peck

Debtor's Counsel: Brian S. Rosen, Esq.
                  Weil, Gotshal & Manges LLP
                  767 Fifth Avenue
                  New York, NY 10153
                  Tel: (212) 310-8602
                  Fax: (212) 310-8007

Total Assets: More than $100 Million

Total Debts:  More than $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                              Claim Amount
   ------                              ------------
Pension Benefit Guaranty Corporation    $12,400,000
1200 K Street, N.W.
Washington, DC 20005

New York State Lottery                   $6,000,000
Attn: Susan E. Miller
Executive Deputy Director
One Broadway Center
P.O. Box 750
Schenectady, NY 12301

MGM Grand New York LLC                   $5,692,035
Attn: General Counsel
3600 Las Vegas Blvd. South
Las Vegas, NV 89109

Empire State Development Corp.           $5,000,000
633 3rd Ave, 36th Floor
New York, NY 10017

TVG Network                              $4,333,328
19545 N.W. Von Neumann Dr.
Suite 210
Beaverton, OR 97006

Lien Gaming                              $1,386,695
2901 Frontage Rd.
WE HWY 10
Morrhead, MN 56560

The Port Authority of NY & NJ            $1,000,000
225 Park Avenue South
New York, NY 10003

Commissioner of Taxation and Finance       $625,000
New York State Dept. of Taxation and
Finance
Bankruptcy Section
P.O. Box 5300
Albany, NY 12205

Forum Services Group, Inc.                 $495,377
260 Madison Avenue
Suite 200
New York, NY 10016

GC Consulting                              $367,253
867 Westfield Road
Scotch Plains, NJ 07076

Sports Publication Prod. (NY) LLC          $360,736
100 Broadway, 7th Floor
New York, NY 10005

Aon Risk Services                          $275,995
P.O. Box 7247-7376
Philadelphia, PA 19170

United Tote Company                        $224,158
11505 Susquehanna Trail
Glen Rock, PA 17327

Long Island Power Authority                $216,466
P.O. Box 888
Hicksville, NY 11815

Associated Premium Corp.                   $176,400
124 MacArthur Court
Nicholasville, KY 40356

NYS Racing and Wagering Board              $150,000
One Broadway Center
Suite 600
Schenectady, NY 12305

Comprehensive Health Services              $144,459
8229 Boone Blvd.
Suite 700
Vienna, VA 22182

Finger Lakes Race Track                    $128,452
Attn: David Bridger
P.O. Box 25250
Farmington, NY 14425

NYS Thoroughbred Breeding and              $108,015
Development Find Corp.
19 Roosevelt Drive, Suite 250
Saratoga Springs, NY 12866

Niagara Mohawk (National Grid)             $101,588
P.O. Box 4798
Syracuse, NY 13321


NOMURA HOME: Fitch Places BB+ Rating on $12.2 Mil. Class B-2 Certs
------------------------------------------------------------------
Fitch assigns these ratings to Nomura Home Equity Loan Trust,
Series 2006-FM2:

     -- $952,346,000 classes I-A-1, II-A-1, II-A-2, II-A-3, II-A-4
        'AAA';

     -- $46,051,000 class M-1 'AA+';

     -- $41,753,000 class M-2 'AA+';

     -- $25,788,000 class M-3 'AA';

     -- $22,104,000 class M-4 'AA-';

     -- $20,876,000 class M-5 'A+';

     -- $19,034,000 class M-6 'A';

     -- $18,420,000 class M-7 'A-';

     -- $15,964,000 class M-8 'BBB+';

     -- $12,894,000 class M-9 'BBB';

     -- $12,894,000 privately offered class B-1 'BBB-'; and

     -- $12,280,000 privately offered class B-2 'BB+'.

The 'AAA' rating on the senior certificates reflects the 22.45%
total credit enhancement provided by the 3.75% class M-1, 3.40%
class M-2, 2.10% class M-3, 1.80% class M-4, 1.70% class M-5,
1.55% class M-6, 1.50% class M-7, 1.30% class M-8, 1.05% class M-
9, 1.05% privately offered class B-1, 1.00% privately offered
class B-2 and fully funded initial and target
overcollateralization of 2.25%.  All certificates have the benefit
of monthly excess cash flow to absorb losses.  In addition, the
ratings on the certificates reflect the quality of the underlying
collateral, and Fitch's level of confidence in the integrity of
the legal and financial structure of the transaction.

The mortgage pool consists of first and second lien, fixed and
adjustable-rate mortgage loans with an aggregate principal balance
of approximately $1,228,042,345 as of the cut-off date,
Oct. 1, 2006.  The weighted average FICO score is 628. The
weighted average loan rate is approximately 8.452%.  The weighted
average remaining term to maturity is 355 months.  The average
principal balance of the loans is approximately $214,918.  The
weighted average original loan-to-value ratio is 81.25%.  The
properties are primarily located in California (25.00%), Florida
(16.14%), and New York (12.15%).

None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws.

Nomura Home Equity Loan, Inc. deposited the loans into the trust,
which issued the certificates, representing beneficial ownership
in the trust.  HSBC Bank USA, National Association, will act as
Trustee.  Equity One, Inc. will act as servicer, and Popular
Mortgage Servicing, Inc. (rated 'RPS2-' by Fitch) will act as
subservicer for this transaction.  Wells Fargo Bank, N.A. (rated
'RMS1' by Fitch) will act as master servicer.

For federal income tax purposes, the trust fund will comprise
multiple real estate mortgage investment conduits, organized in a
tiered REMIC structure.


NORTH AMERICAN: Moody's Lowers Corp. Family Rating One Notch to B3
------------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
of North American Membership Group Inc. to B3 from B2 and the
second lien term loan rating to Caa2 from Caa1.  The B1 rating on
the first lien term loan was affirmed.

The rating outlook remains negative.

The ratings downgrade reflects negative free cash flow from
operations, weaker than expected profitability levels and tight
liquidity.  Moody's anticipates that NAMG may violate financial
covenants over the next few quarters and may need to seek a waiver
from its bank group.  Despite a long track record in the industry
and a large membership base of about 4 million members, increases
in operating costs and working capital requirements may prevent
the company from generating positive cash flow from operations in
the next 12-24 months.  Leverage and interest coverage metrics
that remain solid for the rating category precluded a further
downgrade in the ratings.

Moody's took these rating actions:

   -- Downgraded $20 million senior secured second lien term loan
      facility due 2011 to Caa2 from Caa1 (LGD 5 -- 80%)

   -- Downgraded corporate family rating to B3 from B2

   -- Downgraded probability of default rating to B3 from B2

   -- Affirmed $16.5 million senior secured first lien revolving
      credit facility due 2010, rated B1 (LGD 3- 32%)

   -- Affirmed $75 million senior secured first lien term loan
      facility due 2011, rated B1 (LGD 3- 32%)

   -- Affirmed $2.5 million senior secured first lien delayed
      draw term loan facility, rated B1 (LGD 3- 32%)

The negative outlook anticipates weak profitability, continued
high levels of accounts receivable and inventory and limited, if
any, free cash flow from operations over the next year.  The
fourth calendar quarter is typically the strongest quarter for the
company and absent good response rates to its marketing programs,
Moody's expects that NAMG may breach financial covenants under its
credit facility.

The ratings could be downgraded if

   (i) profitability is below expectations in the seasonally
       strong fourth quarter of 2006; or ,

  (ii) the company breaches its financial covenants and fails to
       get a timely waiver from the bank group.

Sustained negative free cash flow generation due to increasing
working capital requirements or increasing bad debt expense could
also result in a downgrade.

The outlook could be changed to stable if profitability and cash
flow generation improve which result in adequate headroom under
financial covenants.  Free cash flow to debt that can be sustained
in the 2%-5% range could support a stable outlook in the B3 rating
category.

Based in Minnetonka, Minnesota, NAMG is a club-based affinity
marketing company.  Reported revenues for the 12 month period
ending Sept. 30, 2006 were about $224 million.


NORTHEAST GENERATION: S&P Lifts Rating on $320 Mil. Bonds to BB-
----------------------------------------------------------------
Standard & Poor's Ratings Services raised the rating on Northeast
Generation Co.'s $320 million first mortgage bonds to 'BB-' from
'B+' and removed the rating from CreditWatch with positive
implications, where it had been placed on Sept. 20, 2006.  

The outlook is stable.

At the same time, Standard & Poor's assigned its '1' recovery
rating to the first mortgage bonds, indicating expectations of
full recovery of principal in a payment default scenario.
    
"The rating action reflects NE Energy's purchase of Northeast
Utilities' (BBB/Stable/--) competitive generation assets, which
includes NGC's assets, for $1.34 billion including the assumption
of the first mortgage bonds," said Standard & Poor's credit
analyst Kenneth L. Farer.

NE Energy is a wholly owned subsidiary of NE Energy Holdings Inc.,
which, in turn, is indirectly owned by Energy Capital Partners I
L.P.

Regarding the recovery rating, NGC's balance sheet includes net
utility plant of about $800 million (2.5x the amount of first
mortgage bonds outstanding), and substantially all of NGC's assets
secure its $320 million first mortgage bonds.

The outlook is stable.

Because NGC does not meet Standard & Poor's special-purpose
entity, bankruptcy-remote criteria, NGC's outlook depends on
NE Energy and NGC's purchase-power agreement with NE Energy
Management.  As such, Standard & Poor's could revise the outlook
to negative if capacity pricing in New England or performance at
Northfield Mountain or Mt. Tom is less than forecast or if NGC's
DSCR falls below 1.5x.

"However, we are unlikely to revise the outlook to positive, due
to NE Energy's sizable refinancing risk, potential for NE Energy's
debt service coverage to fall below 1x, and high reliance on
Northfield Mountain for cash flow," said Mr. Farer.


NORTEL NETWORKS: Secures $7.7 Million NRC Maintenance Contract
--------------------------------------------------------------
Nortel Government Solutions(x), a company wholly owned by
Nortel(x), has been selected by the U.S. Nuclear Regulatory
Commission to operate and maintain its digital courtroom systems
in Rockville, Maryland and Las Vegas, Nevada.

Nortel Government Solutions will provide the services under an
agreement estimated at $7.7 million over four years.  The
agreement also includes support for NRC hearings, as well as
application development and testing.

The systems were developed by Nortel Government Solutions and
delivered to the NRC earlier this year.  They provide electronic
evidence presentation, digital audio and video transcripts, and
electronic capture and display of evidence.  This enables
immediate electronic access to documents, and live video and audio
feeds to ensure the widest possible public access to NRC
proceedings.

The digital courtroom systems are designed to help the NRC's
Atomic Safety and Licensing Board Panel simplify proceedings
ranging from routine cases to more complicated hearings involving
nuclear reactor licenses.

The Company says that one of the proceedings is the potential
adjudication regarding a U.S. Department of Energy license
application for a commercial nuclear reactor waste storage
facility at Nevada's Yucca Mountain, located 100 miles northwest
of Las Vegas, which is expected to last three to four years as
mandated by Congress and could become one of the largest and most
complex administrative hearings in U.S. history.  The digital
database available to the two courtrooms is capable of storing and
providing electronic access to the millions of pages of evidence
and thousands of hours of testimony that may accumulate.

"These showcase systems integrate everything into one multimedia
system with real-time access to information for all participants,"
Chuck Saffell, chief executive officer, Nortel Government
Solutions, said.  "Our operations and maintenance services will
help the NRC to achieve and sustain the highest performance,
efficiency, security and reliability from its electronic
courtrooms."

               About Nortel Government Solutions

Based in Fairfax, Virginia, Nortel Government Solutions --
http://www.nortelgov.com/-- is a network-centric integrator,  
providing the services expertise, mission-critical systems and
secure communications that empower government to ensure the
security, livelihood, and well being of its citizens.  The company
is a provider for solutions designed to improve workforce
productivity, reduce operating costs, and streamline inter-agency
communications.

                     About Nortel Networks

Headquartered in Ontario, Canada, Nortel Networks Limited
(NYSE/TSX: NT) -- http://www.nortel.com/-- delivers technology  
solutions encompassing end-to-end broadband, Voice over IP,
multimedia services and applications, and wireless broadband.
Nortel does business in more than 150 countries.

                          *    *    *

As reported in the Troubled Company Reporter on July 10, 2006,
Dominion Bond Rating Service confirmed the long-term ratings of
Nortel Networks Capital Corporation, Nortel Networks Corporation,
and Nortel Networks Limited at B (low) along with the preferred
share ratings of Nortel Networks Limited at Pfd-5 (low).  All
trends are Stable.

DBRS confirmed B (low) Stb Senior Unsecured Notes; B (low) Stb
Convertible Notes; B (low) Stb Notes & Long-Term Senior Debt;
Pfd- 5 (low) Stb Class A, Redeemable Preferred Shares; and Pfd-5
(low) Stb Class A, Non-Cumulative Redeemable Preferred Shares.

As reported in the Troubled Company Reporter on June 20, 2006,
Moody's Investors Service affirmed the B3 corporate family rating
of Nortel; assigned a B3 rating to the proposed US$2 billion
senior note issue; downgraded the US$200 million 6.875% Senior
Notes due 2023 and revised the outlook to stable from negative.

Standard & Poor's also affirmed its 'B-' long-term and 'B-2'
short-term corporate credit ratings on the company, and assigned
its 'B-' senior unsecured debt rating to the company's proposed
$2 billion notes.  The outlook is stable.


NUTECH DIGITAL: Posts $399,002 Net Loss in 2006 Second Quarter
--------------------------------------------------------------
NuTech Digital, Inc. reported a $399,002 net loss on $188,020 of
sales for the second quarter ended June 30, 2006, compared with a
$596,248 net loss on $299,252 of sales for the same period in
2005.

At June 30, 2006, the company's balance sheet showed $2,496,373 in
total assets and $3,334,558 in total liabilities, resulting in a
$838,185 stockholders' deficit.

The company's balance sheet at June 30, 2006, also showed strained
liquidity with $659,730 in total current assets available to pay
$2,549,398 in total current liabilities.

Full-text copies of the company's second quarter financial
statements are available for free at:
                                  
                http://researcharchives.com/t/s?144b          

                           Going Concern
  
Weaver & Martin, LLC, of Kansas City, Mo., expressed substantial
doubt about Nutech Digital, Inc.'s ability to continue as a going
concern after auditing the company's Dec. 31, 2005 financial
statements.  The auditing firm pointed to the company's recurring
losses from operations and the company's dependence upon the
continued sale of its securities or obtaining debt financing for
funds to meet its cash requirements.
                        
                       About Nutech Digital

NuTech Digital, Inc. -- http://www.nutechdvd.com/-- is engaged in   
the business of producing popular music concerts and licensing and
distributing general enertainment products, most of which are made   
available through digital versatile discs.  The company's products
include Japanese anime, late night programming, and general
entertainment action adventure films.  The company's products are  
principally sold through retail  stores, the Internet and
distributors.


OWENS CORNING: Reorganization Cues S&P to Lift Default Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Owens Corning to 'BBB-' from 'D', after the building
products company's emergence from bankruptcy on Oct. 31, 2006.

All other ratings are affirmed.

The outlook is stable.

"Owens Corning's moderate financial policies and ability to
generate meaningful free cash flow should permit it to perform in
line with our expectations throughout the cycle," said
Standard & Poor's credit analyst Pamela Rice.  

"We could revise the outlook to negative if the downturn in
residential construction is worse than we currently expect or if
insulation prices drop precipitously and the company is unable to
offset weaker results with productivity or cost-saving measures.

"A positive outlook would require an appreciable improvement in
the company's business profile or a more conservative capital
structure that would permit it to withstand severe downturns with
stronger-than-currently expected credit metrics."

Toledo, Ohio-based Owens manufactures building products and
composite materials focused mainly in North America.  Its primary
businesses are insulation, roofing and asphalt, glass fiber
reinforcement products, vinyl siding, and manufactured stone
veneer.

The company plans to form a reinforcements and composites joint
venture with Compagnie de Saint-Gobain S.A. (BBB+/Negative/A-2),
although Owens Corning will retain certain of its value-added
fabricated products.  

The rating agency does not expect this transaction to affect
ratings on Owens Corning.  Owens Corning will own a majority (60%)
stake in a larger business that has more geographic and end-market
diversity than Owens' building products businesses.  

In addition, the benefits from potential rationalization and
synergies at the combined venture should be a positive for the
industry and for Owens Corning's profitability over the
intermediate term.


PERFORMANCE TRANSPORTATION: Files Stipulation on $7MM Yucaipa Loan
------------------------------------------------------------------
On October 27, 2006, Performance Transportation Services, Inc.,
and its debtor-affiliates filed with the U.S. Bankruptcy Court for
the Western District of New York a stipulation governing their
$7,000,000 postpetition financing agreement with Yucaipa American
Alliance Fund I, LP, and Yucaipa American Alliance (Parallel) Fund
I, LP.

The Debtors note that the form of the stipulation has yet to be
approved by Yucaipa.

According to the Debtors, approval of the Stipulation will
facilitate the negotiation and confirmation of a plan of
reorganization and will maintain the value of their estates during
the pendency of their cases.

Among others, the Stipulation provides that on the Plan effective
date, the Junior DIP Obligations will -- at the option of the
Junior DIP Lenders in their sole absolute discretion -- be
automatically exchanged into Voting Shares equal to a percentage
of the total Voting Shares issued pursuant to the Plan.  The
option must be exercised within 10 days after the Court confirms
the Plan.

If the Junior DIP Lenders exercise the option, the Voting Shares
will be allocated among the Junior DIP Lenders on a pro-rata basis
based on the amount of Junior DIP Obligations outstanding at the
time of conversion or on other basis as may be agreed to by the
Junior DIP Lenders.

The Debtors covenant not to:

    (a) incur, create, assume, suffer to exist or permit any other
        superpriority claim that is pari passu with or senior to
        the Junior DIP Superpriority Claims;

    (b) permit the aggregate amount of Capital Expenditures made
        at any time after the Initial Closing Date to exceed
        $9,050,000 on a cumulative basis;

    (c) permit the cumulative Consolidated EBITDA beginning on
        November 1, 2006, and ending in each case on the last day
        of each fiscal month to be less than:

             Period                 EBITDA
             ------                 ------
             November 2006        $7,596,000
             December 2006        $8,933,000

    (d) as of the last day of each calendar month from and after
        the Initial Closing Date, permit the cumulative monthly
        Revenue to be less than 90% of the Forecasted Revenue.
        Prior to the 26th day of each month, the Borrower will
        provide an updated calculation of its monthly cumulative
        Revenue through the prior month-end.

The Junior DIP Commitment will terminate on the earliest of:

    * January 27, 2007;

    * the effective date of the Debtors' confirmed Plan of
      reorganization;

    * November 1, 2006, if the Court has not entered a final
      order approving the Junior DIP Facility by that date;

    * reversal or modification -- if not consented to by the
      Junior DIP Lenders -- of the order approving the Junior DIP
      Facility; or

    * at the Lenders' option, the occurrence of any event of
      default.

In the event of default, the Junior DIP Agent may terminate the
Junior DIP Commitments and declare the Junior DIP Loans, then
outstanding, to be due and payable, together with accrued
interest and any unpaid accrued fees and all other liabilities.
Events of default include:

    (a) one or more judgments will be rendered against the
        Debtors as to any obligation arising after the Petition
        Date, which will not be effectively stayed, and:

           (i) is for an amount in excess of $500,000 in the
               aggregate not covered by insurance; or

          (ii) is for injunctive relief and could reasonably be
               expected to result in a Material Adverse Effect;

    (b) any security interest in Collateral that, individually or
        in the aggregate, is valued in excess of $100,000
        purported to be created by any Junior DIP Security
        Document will cease to be valid;

    (c) any of the cases will be dismissed or converted to a case
        under Chapter 7 of the Bankruptcy Code, a trustee under
        Chapter 7 or Chapter 11 will be appointed in any of the
        cases, and the appointment will not be reversed or vacated
        within 30 days;

    (d) claims for the return of goods shipped to the Parties
        prior to the Petition Date will be made under Section
        546(h) for goods having an aggregate fair market value in
        excess of $50,000;

    (e) the Bankruptcy Court lifts the automatic stay to the
        holders of any security interest to permit foreclosure;

    (f) a plan of reorganization or liquidation other than the
        current Plan will be filed by any Party that does not
        provide for the indefeasible payment in full of the
        Obligations in cash or otherwise provide acceptable
        treatment to the Junior DIP Secured Parties, in the sole
        and absolute discretion of the Junior DIP Lenders;

    (g) any disruption or cessation of production at any of the
        Debtors' customers that contributes more than 5% to the
        annualized consolidated revenues of the Debtors, which
        will continue for 14 days or more;

    (h) any strike or work stoppage at any of the Debtors'
        customers that contributes more than 5% to the annualized
        consolidated revenues of the Debtors, which will continue
        for 14 days or more;

    (i) any announcement by any of the Debtors' customers relating
        to a future event that could be reasonably expected -- on
        a pro forma basis after giving effect to the event as if
        it occurred on the date of the announcement -- to result
        in the reduction by 5% or more of the annual consolidated
        revenues of the Debtors, and in each case, the Debtors
        fail to obtain replacement contracts or commitments of an
        equal or greater value within 60 days of the announcement;
        and

    (j) any of the Debtors seeks to sell assets with a value in
        excess of $500,000, which sale is not on terms and
        conditions acceptable to the Junior DIP Lenders, in their
        sole and absolute discretion.

Yucaipa is represented in the Debtors' cases by Robert A. Klyman,
Esq., and Gregory O. Lunt, Esq., at Latham & Watkins LLP, in Los
Angeles, California.

A full-text copy of the Junior DIP Facility Stipulation is
available at no charge at http://researcharchives.com/t/s?1456

                       Committee Objects

Representing the Official Committee of Unsecured Creditors, David
Neier, Esq., at Winston & Strawn LLP, in New York, contends that
the Junior DIP Facility locks the Debtors into a single path with
Yucaipa as the acquirer of the Debtors, which may or may not
maximize the value of the Debtors' businesses.  If the loan is
fully drawn, Yucaipa will receive an option to convert its
postpetition debt into a 22% equity stake in the reorganized
entity by the terms of the Junior DIP Facility.

In addition, it is not expected that the Debtors will have to
repay their principal and interest obligations under the Junior
DIP Facility because the Loan terms provides that Yucaipa may
convert obligations owing to it by the Debtors into equity of the
reorganized entity.

Mr. Neier also points out that the Stipulation limits the
Debtors' reorganization options by hindering investors or bidders
other than Yucaipa from offering a higher or better price for the
Debtors' assets.  The Stipulation provides that the terms of any
sale of the Debtors' assets must be acceptable to Yucaipa.  The
provision has the chilling effect on competition, preventing any
other investor from acquiring the Debtors' entire business.  It
represents a very effective blocking position for Yucaipa with
respect to competitors for the Debtors' businesses.

The Committee believes that it is premature for the Debtors to
dedicate themselves to a single path towards reorganization to
the exclusion of all others.

Mr. Neier also notes that the Junior DIP Facility may be in
conflict with certain of the terms of the Final Order approving
the Senior DIP Facility with Credit Suisse, like the agreement
among Credit Suisse, the Debtors and Committee to set aside 50%
of the proceeds of avoidance actions for the benefit of general
unsecured creditors.  The proceeds of avoidance actions may
represent the only source of recovery for general unsecured
creditors, Mr. Neier adds.

Moreover, under no circumstances should Yucaipa be granted liens
in avoidance actions such that it could decide those avoidance
actions that may or may not be pursued.  Mr. Neier informs the
Court that there are substantial potential avoidance actions --
presently estimated by the Committee to be more than $48,000,000
-- that are available against insiders of the Debtors.  Having
control of the insider avoidance actions effectively gives
Yucaipa a sword of Damocles over the Debtors' board of directors,
and an effective method in ensuring that the Board approves a
plan of reorganization to Yucaipa's liking, Mr. Neier says.

Based on information available to the Committee, it is unclear
whether the Debtors will in fact be required to access the Junior
DIP Facility to cash collateralize letters of credit or to meet
general working capital needs.  Mr. Neier says the Debtors'
financial advisors have indicated to the Committee that the
Debtors may be able to cover their financing needs based on their
current cash flows and availability under the Senior DIP
Facility, which remains undrawn.

The concessions granted to Yucaipa as part of the Junior DIP
Facility are simply too rich in comparison to the benefits that
are being conferred upon the Debtors, Mr. Neier adds.
Notwithstanding, the Committee is mindful that Yucaipa may
provide an attractive opportunity for the Debtors.

It is wise for the Debtors to obtain Yucaipa's commitment as a
backstop in case liquidity under the Senior DIP Facility is
insufficient for their purposes, Mr. Neier says.  Should it
ultimately turn out that the Junior DIP Facility was not
absolutely necessary, but was drawn down nonetheless, then it
will have been a very expensive proposition to grant Yucaipa the
Conversion Option.

The Committee also notes that certain provisions in the
Stipulation require clarification or are unreasonable,
inappropriate or otherwise objectionable, including:

    (a) The Stipulation provides that if one of the Yucaipa
        lending parties defaults upon its funding commitment, the
        other Yucaipa lending party is not required to advance
        funds in respect of the defaulting party's commitment.
        Mr. Neier notes that the Yucaipa parties are under common
        control and are closely related affiliates.  They should
        not be permitted to build in such an "out."

    (b) The Stipulation accords Yucaipa a right of consultation
        with respect to negotiations between the Debtors and their
        labor unions.  This is over-reaching.

    (c) Events of Default:

        -- The $50,000 threshold for Section 546 claims is too
           low, and the mere assertion of a claim should not
           trigger a default;

        -- It should only be an event of default if relief from
           stay is granted with respect to material assets of the
           Debtors.  The provision does not contain an appropriate
           materiality qualifier;

        -- It should only be an event of default if a material
           claim under Section 506(c) is granted.  The provision
           does not contain an appropriate materiality qualifier;
           and

        -- Circumstances involving the Debtors' customers are
           entirely out of the Debtors' control.

    (d) The Stipulation contains a blank with respect to the drop-
        dead date upon which the facility will expire.  This
        information must be provided.

    (e) Yucaipa is permitted to assign the obligations and
        commitments under the Stipulation to one or more assignees
        of its choice.  Given the inclusion of the Conversion
        Option and the concomitant right to acquire equity in the
        reorganized entity, the Debtors could find themselves
        stuck with a potential acquirer that may be unattractive
        for any number of reasons. At bottom, if Yucaipa is going
        to commit the Debtors to a future path, it should give its
        commitment to stay the course as well.

Mr. Neier tells Judge Kaplan that the Debtors' request is perhaps
the first step in a plan by the Debtors to hand over the company
to Yucaipa in a debt for equity swap.  However, no auction
process is contemplated, and it appears that there is no process
for developing an alternative plan or for dealing with other
unsolicited offers.  Moreover, he contends that there is no
valuation available to creditors to determine if the plan is
warranted.

The Committee asks the Court not to tolerate a takeover by a
secured junior creditor with no auction and valuation available
to determine if the Debtors have maximized the value of their
estates.

Headquartered in Wayne, Michigan, Performance Transportation
Services, Inc. -- http://www.pts-inc.biz/-- is the second largest  
transporter of new automobiles, sport-utility vehicles and light
trucks in North America.  The Company provides transit stability,
cargo damage elimination and proactive customer relations that are
second to none in the finished vehicle market segment.  The
company's chapter 11 case is administered jointly under Leaseway
Motorcar Transport Company.

Headquartered in Niagara Falls, New York, Leaseway Motorcar
Transport Company Debtor and 13 affiliates filed for chapter 11
protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Case No. 06-00107).
James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A.
Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq.,
at Hodgson Russ LLP represent the Debtors in their restructuring
efforts.  David Neier, Esq., at Winston & Strawn LLP, represents
the Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they estimated assets
between $10 million and $50 million and more than $100 million in
debts.  (Performance Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000)


PERFORMANCE TRANSPORTATION: Withdraws Bonus Program Modifications
-----------------------------------------------------------------
In the Disclosure Statement accompanying the Plan of
Reorganization of Performance Transportation Services, Inc., and
its debtor-affiliates, the Debtors disclose that at the
Oct. 12, 2006 hearing, they withdrew their request to modify the
performance incentive bonus program.

The Debtors explain that the holders of the Second Lien Claims
agreed to carve out of their recoveries incentive payments to
Jeffrey Cornish, the Debtors' chief executive officer; Jack
Stalker, the Debtors' chief financial officer; and John Richter,
the Debtors' chief operating officer.

Pursuant to a Management Incentive Program Term Sheet, the
Eligible Participants will receive $1,754,000 in the aggregate.
Actual allocation will be determined by the Debtors' board of
directors prior to execution of definitive documentation.

The MIP Payment will be paid in Cash to the extent the holders of
Second Lien Claims vote as a class in favor of the Plan.  In the
event the Second Lien Claimants vote as a class to reject the
Plan, the Eligible Participants will receive payment in kind,
aggregating $1,754,000, based on the Second Lien Claimants'
recoveries under the Plan.

The MIP Payment is conditioned, among others, on the entry of a
confirmation order by December 26, 2006.  The amount will be paid
on the Plan effective date.

A full-text copy of the Debtors' Management Incentive Program
Term Sheet is available at no charge at:

              http://researcharchives.com/t/s?1455

Headquartered in Wayne, Michigan, Performance Transportation
Services, Inc. -- http://www.pts-inc.biz/-- is the second largest  
transporter of new automobiles, sport-utility vehicles and light
trucks in North America.  The Company provides transit stability,
cargo damage elimination and proactive customer relations that are
second to none in the finished vehicle market segment.  The
company's chapter 11 case is administered jointly under Leaseway
Motorcar Transport Company.

Headquartered in Niagara Falls, New York, Leaseway Motorcar
Transport Company Debtor and 13 affiliates filed for chapter 11
protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Case No. 06-00107).
James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A.
Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq.,
at Hodgson Russ LLP represent the Debtors in their restructuring
efforts.  David Neier, Esq., at Winston & Strawn LLP, represents
the Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they estimated assets
between $10 million and $50 million and more than $100 million in
debts.  (Performance Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000)


PEMBRIDGE SQUARE: Fitch Rates EUR16 Million Class H Notes at BB+
----------------------------------------------------------------
Fitch has assigned ratings to Pembridge Square Finance Limited
floating-rate credit-linked notes, which were issued on
Oct. 19, 2006:

     -- EUR17,000,000 class A1 due 2041 'AAA';
     -- EUR80,000,000 class A2 due 2041 'AAA';
     -- EUR70,000,000 class B due 2041 'AA+';
     -- EUR60,000,000 class C due 2041 'AA';
     -- EUR50,000,000 class D due 2041 'AA-';
     -- EUR40,000,000 class E due 2041 'A';
     -- EUR25,000,000 class F due 2041 'A-';
     -- EUR22,000,000 class G due 2041 'BBB';
     -- EUR16,000,000 class H due 2041 'BB+';

Pembridge Square Finance Limited is a fully managed synthetic CDO
that references a EUR2.0 billion diversified portfolio.  The
portfolio consists of primarily investment grade corporate
obligations referenced via direct investments (50% of the total
referenced amount) and through 10 inner tranche credit default
swaps (35% of the total referenced amount) as well as of various
investment grade ABS (15% of the total referenced amount).

The transaction is designed to provide credit protection for
realized losses on the reference portfolio through a master credit
default swap between the issuer and the swap counterparty, KBC
Investments Cayman Islands V, Ltd.  The legal maturity date of the
CDS is January 2041, but this trade is scheduled to amortize on or
after January 2017.  The rating of the notes addresses the
likelihood that investors will receive full and timely payments of
interest and ultimate receipt of principal by the scheduled
maturity date.

Pembridge Square provides protection to the swap counterparty via
a CDS that is collateralized with the issuance proceeds of the
notes.  The issuer will enter into a guaranteed investment
contract agreement with KBC Investments Hong Kong Limited
(guaranteed by KBC Bank NV), which will allow it to redeem
collateral at the purchase price of the principal amounts on the
maturity date.  Under the GIC agreement, the issuer will pay to
the GIC counterparty an amount equal to the net proceeds of
issuance of the notes to be used for the purchase of the
collateral.

Pembridge Square pays the swap counterparty for any losses due to
credit events experienced in the portfolio above the first loss
amount for each class up to the balance on the notes by
liquidating collateral.  Any reference obligations in the
portfolio can be traded at the discretion of the portfolio swap
counterparty, KBC, subject to trading guidelines and portfolio
criteria restrictions.  While KBC bears no fiduciary
responsibility to noteholders, the capital structure of the
transaction aligns interests of the portfolio manager with those
of the investors through an exclusively subordinate management fee
and equity holdings, among other features.

The ratings are based upon the structure of the issuer, the
financial strength and abilities of KBC as the portfolio swap
counterparty, and KBC Bank NV as GIC guarantor.


PREMIER ENTERTAINMENT: Taps Byrd & Wiser as Bankruptcy Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of
Mississippi, gave Premier Entertainment Biloxi, LLC, dba Hard Rock
Hotel & Casino Biloxi and its debtor-affiliates, authority to
employ Byrd & Wiser, as their bankruptcy counsel.

Byrd & Wiser is expected to assist the Debtors in all aspects
concerning their chapter 11 proceedings.

The Debtors' application did not disclose the firm's compensation
rates.

Robert Alan Byrd, Esq., at Byrd & Wiser, assures the Court that
his firm does not hold any interest adverse to the Debtors'
estate.

Headquartered in Biloxi, Mississippi, Premier Entertainment Biloxi
LLC, dba Hard Rock Hotel & Casino Biloxi --
http://www.hardrockbiloxi.com/-- owns and operates hotels.  The  
Company filed for chapter 11 protection on Sept. 19, 2006
(Bankr. S.D. Ms. Case No. 06-50975).  No Official Committee of
Unsecured Creditors has been appointed in the Debtor's bankruptcy
proceedings.  When the Debtor filed for protection from its
creditors, it estimated assets $252,862,215 and debts of
$226,069,921.


PURE FISHING: Moody's Assigns Loss-Given-Default Ratings
--------------------------------------------------------
In connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology for the U.S. consumer products sector, the rating
agency confirmed its B1 Corporate Family Rating for Pure Fishing,
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
   ----------           -------  -------  ------   ----------
   $160M first lien
   senior secured
   term loan due 2010     B1       Ba3     LGD3        39%

   $45M first lien sr.
   sec. revolving credit
   facility due 2009      B1       Ba3     LGD3        39%

   $35M second lien sr.
   sec. term loan
   due 2011               B2       B3      LGD5        87%

Moody's explains that current long-term credit ratings are
opinions about expected credit loss, which incorporate both the
likelihood of default and the expected loss in the event of
default.  The LGD rating methodology will disaggregate these two
key assessments in long-term ratings.  The LGD rating methodology
will also enhance the consistency in Moody's notching practices
across industries and will improve the transparency and accuracy
of Moody's ratings as Moody's research has shown that credit
losses on bank loans have tended to be lower than those for
similarly rated bonds.

Probability-of-default ratings are assigned only to issuers, not
specific debt instruments, and use the standard Moody's
alpha-numeric scale.  They express Moody's opinion of the
likelihood that any entity within a corporate family will default
on any of its debt obligations.

Loss-given-default assessments are assigned to individual rated
debt issues -- loans, bonds, and preferred stock.  Moody's opinion
of expected loss are expressed as a percent of principal and
accrued interest at the resolution of the default, with
assessments ranging from LGD1 (loss anticipated to be 0% to 9%) to
LGD6 (loss anticipated to be 90% to 100%).

Headquartered in Sprit Lake, Iowa, Pure Fishing, Inc. offers a
comprehensive line of products for the global fishing tackle
market, including fishing line, rods, baitcast and spinning reels,
and artificial bait.  Products are sold to mass merchandisers,
sporting good retailers, catalogs, and wholesalers.


PURE MORTGAGES: Moody's Affirms Ba2 Rating on $23-Mil. Notes
------------------------------------------------------------
Moody's Investors Service upgraded the ratings of two classes and
affirmed the ratings of five classes of Pure Mortgages 2004:

   -- Class A+, $45,547, Floating Rate, affirmed at Aaa

   -- Class A, $52,100,000, Floating Rate, affirmed at Aaa

   -- Class B, $26,050,000, Floating Rate, affirmed at Aaa

   -- Class C, $28,650,000, Floating Rate upgraded to Aa1 from
      Aa3

   -- Class D, $13,050,000, Floating Rate upgraded to A1 from A2

   -- Class E, $29,950,000, Floating Rate affirmed at Baa2

   -- Class F, $23,500,000, Floating Rate affirmed at Ba2

As of the August 15, 2006 distribution date, the transaction's
aggregate bond balance has decreased by approximately 65.8% to
$355.9 million from $1 billion at securitization.  The
Certificates are credit-linked to a reference pool of commercial
mortgage loans originated by various divisions of HSH Nordbank AG.  
Since securitization, 27 of the loans in the reference pool have
paid off, leaving 14 loans remaining in the pool.  The loans range
from less than 1% to 12.1% of the pool, with the top five loans
representing 56.4% of the outstanding pool balance.

Moody's was provided with year-end 2005 operating results for 100%
of the pool.  Moody's weighted average loan to value ratio for the
reference pool is 69.2%, compared to 71.3% at Moody's last full
review in May 2006 and compared to 76.2% at securitization.  
Moody's is upgrading Classes C and D due to increased credit
support from loan payoffs and amortization and the improved
overall quality of the reference pool.

The three largest loans represent 35.4% of the reference pool.

I

The largest loan is the 1325 Avenue of the Americas Loan
($43.2 million - 12.1%), which represents a 24.4% share in a
syndicated loan secured by a 798,000 square foot Class A office
building located in midtown Manhattan, New York.  The property is
100.0% occupied, compared to 96.6% at securitization.  The loan
has amortized by approximately 3.8% and matures in February 2014.
Moody's LTV is 55.9%, compared to 71% at last review.

II

The second largest loan is the 410 Park Avenue Loan
($42.8 million - 12%), which represents a 64.3% share in a
syndicated loan secured by a 228,700 square foot office building
located in midtown Manhattan, New York.  The property is
98.5% occupied, compared to 99.4% at securitization.  The
property's financial performance has been impacted by an increase
in expenses.  The loan has amortized by approximately 2.6% and
matures in June 2008.  Moody's LTV is 85.5%, compared to 76.2% at
last review.

III

The third largest loan is the 712 Fifth Avenue Loan
($40 million -- 11.2%), which represents a 27.3% share in a
syndicated loan secured by a 543,200 square foot office building
located in midtown Manhattan, New York.  The property is
97% occupied, compared to 95.8% at securitization.  The loan has
amortized by approximately 1.5% and matures in June 2013.  Moody's
LTV is 64.4%, compared to 63.4% at last review.  Moody's current
shadow rating is Baa2, the same as at last review.

The pool's collateral is a mix of office, multifamily and retail.
The collateral properties are located in seven states and
Washington, D.C. with a concentration in New York (52.2%) and
California.


REEDS INC.: Posts $587,238 Net Loss in 2006 Second Quarter
----------------------------------------------------------
Reeds, Inc., reported a $587,238 net loss on $3,157,818 of sales
for the second quarter ended June 30, 2006, compared with a
$58,048 net loss on $2,582,273 of sales for the same period in
2005.

At June 30, 2006, the company's balance sheet showed $5,124,380 in
total assets and $5,502,966 in total liabilities, resulting in a
$378,586 stockholders' deficit.

The company's balance sheet as of June 30, 2006, also showed
strained liquidity with $2,425,649 in total current assets
available to pay $4,266,040 in total current liabilities.

Full-text copies of the company's second quarter financial
statements are available for free at:

               http://researcharchives.com/t/s?1447

                      Going Concern Doubt

Weinberg & Company, P.A., expressed substantial doubt about Reeds,
Inc.'s ability to continue as a going concern after auditing the
company's financial statements for the year ended Dec. 31, 2005.  
The auditing firm pointed to the company's loss of $825,955,
negative cash flow from operating activities of $42,610 during the
year ended Dec. 31, 2005, and working capital deficiency of
$1,594,758 as of Dec. 31, 2005.

                         About Reeds

Reeds, Inc. -- http://www.reedsgingerbrew.com/-- develops,  
manufactures, markets, and sells natural non-alcoholic and "New
Age" beverages, candies and ice creams.  "New Age Beverages" is a
category that includes natural soda, fruit juices and fruit
drinks, ready-to-drink teas, sports drinks and water.


REFCO INC: Court Gives Final Okay on Amended Disclosure Statement
-----------------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York has issued a final written order
approving Refco Inc. and its debtor-affiliates' Disclosure
Statement, as modified, with respect to its First Amended Plan of
Reorganization.

Judge Drain found that the Disclosure Statement contains "adequate
information" as that term is defined in Section 1125 of the
Bankruptcy Code.

Judge Drain ruled that the Disclosure Statement may be amended
and modified from time to time to incorporate immaterial
modifications, fill in blanks, and reflect any modifications that
the Debtors determine to be appropriate, which do not materially
change the Disclosure Statement or affect any rights of a party-
in-interest

All objections, to the extent not withdrawn or resolved, are
overruled.

The Debtors are authorized and empowered to take all steps and
perform acts as may be necessary to implement and effectuate the
Disclosure Statement Order.

                    Amended Disclosure Statement

As reported in the Troubled Company Reporter on Oct. 11, 2006,
the Debtors filed with the Court their Amended Plan of
Reorganization and accompanying Disclosure Statement, with Marc
Kirschner, the Chapter 11 trustee for Refco Capital Markets,
Ltd.; the Official Committee of Unsecured Creditors; and the
Additional Committee of Unsecured Creditors as co-proponents.

The Amended Plan contemplates that on or prior to the effective
date of the plan, 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 Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436).  (Refco Bankruptcy News, Issue No. 47; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).


REFCO INC: Court Sets December 15 Joint Plan Confirmation Hearing
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
set Dec. 15, 2006, at 10:00 a.m., as the hearing to consider
confirmation of the First Amended Joint Plan of Reorganization
filed by Refco Inc. and its debtor-affiliates; the Official
Committee of Unsecured Creditors of Refco and the Additional
Committee; and Marc Kirschner, the Chapter 11 Trustee for Refco
Capital Markets, Ltd.

The Confirmation Hearing may be continued from time to time by
announcing it in open court, without further notice to parties-
in-interest.

The Court also set:

   * December 1, 2006, at 4:00 p.m., as the deadline for filing
     and serving objections to Plan confirmation;

   * November 20, 2006, at 4:00 p.m., as the deadline for filing
     and serving objections to claims solely for purposes of
     voting on the Plan, which deadline will not apply to Claims
     Objections that may be asserted for purposes other than
     voting on the Plan;

   * December 5, 2006, at 4:00 p.m., as the deadline for filing
     and serving motions pursuant to Rule 3018(a) of the Federal
     Rules of Bankruptcy Procedure seeking temporary allowance
     of claims for voting purposes; and

   * December 8, 2006, at 5:00 p.m., as the deadline for
     submitting ballots to Financial Balloting Group LLC, the
     Debtors' special voting agent.

Claimholders whose claims are subject to an objection that was
served after the Claims Objection Deadline will not be subject to
the Rule 3018(a) Motion Deadline.

Pursuant to Sections 105(a) and 502(a) of the Bankruptcy Code,
any claim as to which an objection has been filed before the
Claims Objection Deadline will be ineligible to vote on the Plan,
and that claim will not be counted in determining whether the
Section 1126(c) requirements have been met with respect to the
Plan:

   (i) unless the claim has been temporarily allowed for voting
       purposes pursuant to Rule 3018(a); or

  (ii) except to the extent that the objection to that claim has
       been resolved in favor of the creditor asserting the
       claim.

Holders of claims in Contributing Debtors Classes 4, 5(a), 5(b)
and 6; FXA Classes 4, 5(a), 5(b) and 6; and RCM Classes 3, 4, 5,
6, 7 and 8 are impaired and entitled to vote on the Plan.  
Failure of a claimholder to timely deliver a properly executed
Ballot will be deemed to constitute an abstention by that holder
with respect to voting on the Plan, and that abstention will not
be counted as a vote for or against the Plan.

The Honorable Robert D. Drain fixed Oct. 16, 2006, as the record
date for purposes of determining creditors and equity holders
entitled to receive Solicitation Packages and related materials,
if any; and creditors entitled to vote to accept or reject the
Plan and elect certain treatment.

Judge Drain directed the Debtors to mail to all of their known
creditors, the Senior Subordinated Note Indenture Trustee and
equity security holders as of the Record Date, and all other
entities required to be served under Rules 2002 and 3017, notice
of, inter alia, the Confirmation Hearing, within Oct. 25, 2006.

Furthermore, Judge Drain ruled that each Senior Subordinated Note
Claimholder will receive BAWAG Proceeds as a component of its pro
rata share of the Senior Subordinated Note Holder Distribution,
unless that Noteholder opts out of the BAWAG Settlement.

Only the Senior Subordinated Note Claimholders who vote to reject
the Plan will be eligible to elect not to receive Senior
Subordinated Note Holder BAWAG Proceeds.  Election by any Senior
Subordinated Note Claimholder who votes to accept the Plan will
be disregarded.

Holders of Class 3 RCM FX/Unsecured Claims and Class 4 RCM
Securities Customer Claims under the Plan will be deemed to have
agreed to:

   (i) assign their RCM Related Claims against the Debtors to
       the Litigation Trust;

  (ii) affirm their understandings that their RCM Related
       Claims against any Contributing Non-Debtor Affiliate will
       be subordinated pursuant to the Plan, as of each
       applicable Contributing Non-Debtor Affiliate Trigger Date,
       to all other existing claims against and equity interests
       in the applicable Contributing Non-Debtor Affiliate; and

(iii) release the Secured Lenders from the Secured Lender
       Released Claims, if any, unless the holders elect not to
       accept that treatment.

The Ballots for Class 6 FXA Convenience Claims, Class 6 RCM
FX/Unsecured Convenience Claims and Class 7 RCM Securities
Customer Convenience Claims will contain the same Ballot
elections as the Ballots for Class 5(a) FXA General Unsecured
Claims, Class 3 RCM FX/Unsecured Claims, and Class 4 RCM
Securities Customer Claims.  However, the Ballot elections made
on a particular Convenience Class Ballot will be effective only
if Convenience Class treatment is denied to the claimant making
the Ballot elections due to oversubscription of the applicable
Convenience Class.

Parties-in-interest are entitled to request that the Debtors
demonstrate cause for any instance in which:

   (a) a Ballot was withdrawn;

   (b) a vote was changed by the filing of a superseding Ballot;
       or

   (c) the Voting Deadline was extended.

The deadline for filing and serving a Request for Cause will be
December 14, 2006, at 12:00 noon.

Notwithstanding Local Rule 3018-1(b), the Debtors' voting agents
will serve by December 12, 2006, notice to any claimholder who is
permitted to make an election with respect to a claim treatment,
but whose election is deemed ineffective or otherwise is not
counted.

                         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 Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436).  (Refco Bankruptcy News, Issue No. 47; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).


REFCO INC: Court Provides Clarification on Nov. 15 Claims Bar Date
------------------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York clarified that in the case of Refco
Capital Markets Ltd., the bar date for administrative claims will
apply whether RCM is being administered in Chapter 11 or Chapter 7
of the Bankruptcy Code.

The Bankruptcy Court previously set November 15, 2006, as the
deadline for filing administrative expense payment requests in
Refco Inc. and its debtor-affiliates' chapter 11 cases.

The Court also set a subsequent Administrative Bar Date for
claims that accrue from November 1, 2006, through the effective
date of the Debtors' Chapter 11 Plan of Reorganization.  That
deadline will be on the 30th calendar day following the Plan
Effective Date.

Judge Drain ruled that these claims do not require filing of
Administrative Expense Payment Requests on or before the
Administrative Bar Dates:

   -- postpetition claims of professionals retained in the
      Debtors' cases for compensation for postpetition fees and
      Expenses;

   -- postpetition claims based on goods or services provided in
      the ordinary course of business, which are paid or remain
      payable according to typical and customary business terms.

Failure to file requests for payment of Ordinary Course of
Business Claims by the Administrative Bar Dates will not bar
payment of claims in the ordinary course of business.

Judge Drain further ruled that the Ad Hoc Committee of Equity
Security Holders, Bank of America, N.A., and the Debtors'
prepetition secured lenders under the August 2004 credit
agreement are exempted from the Initial Administrative Bar Date.

Man Financial Inc. will have until November 27, 2006, to file all
of its Administrative Expense Payment Requests.

Any Administrative Expense Claimholder against the Debtors who is
required, but fails to file an Administrative Expense Payment
Request on or before the Administrative Bar Dates or the date, as
to Man, will:

   (i) be forever barred, estopped, and permanently enjoined
       from asserting Administrative Expense Claim against the
       Debtors, their successors, or their property; and

  (ii) not be entitled to receive further notices regarding the
       Administrative Expense Claims.

                         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 Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436).  (Refco Bankruptcy News, Issue No. 47; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).


SALOMON BROTHERS: Moody's Ratings on 3 Cert. Classes Slides to C
----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes,
affirmed the ratings of six classes and downgraded the ratings of
four classes of Salomon Brothers Mortgage Securities VII, Inc.,
Commercial Mortgage Pass-Through Certificates, Series 2000-C2:

   Class A-2, $452,975,589, Fixed, affirmed at Aaa
   Class X, Notional, affirmed at Aaa
   Class B, $33,214,000, Fixed, upgraded to Aaa from Aa1
   Class C, $33,215,000, Fixed, upgraded to A1 from A2
   Class D, $7,815,000, Fixed,  upgraded to A2 from A3
   Class E, $11,723,000, Fixed, affirmed at Baa1
   Class F, $13,677,000, Fixed, affirmed at Baa2
   Class G, $9,769,000, WAC, affirmed at Baa3
   Class J, $13,677,000, Fixed, affirmed at B3
   Class K, $5,861,000, Fixed, downgraded to Caa2 from Caa1
   Class L, $5,861,000, Fixed, downgraded to C from Caa2
   Class M, $8,792,000, Fixed, downgraded to C from Caa3
   Class N, $2,833,398, Fixed, downgraded to C from Ca

As of the October 18, 2006 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 20.6%
to $620.9 million from $781.5 million at securitization.

The Certificates are collateralized by 164 mortgage loans ranging
in size from less than 1% to 4.8% of the pool, with the top
10 loans representing 28.8% of the pool.  Thirty loans,
representing 22.4% of the pool, have defeased and have been
replaced with U.S. Government securities.

Six loans have been liquidated from the pool resulting in
aggregate realized losses of approximately $9 million.  Six loans,
representing 6.6% of the pool, are currently in special servicing.  
The largest specially serviced loan is Diamond Point Plaza, which
is discussed below.  Moody's has estimated aggregate losses of
approximately $13.3 million for all of the specially serviced
loans.  

Thirty seven loans, representing 19.7% of the pool, are on the
master servicer's watchlist.

Moody's was provided with year-end 2005 operating results for
98.7% of the performing loans.  Moody's loan to value ratio is
92.6%, compared to 95.5% at Moody's last full review in February
2005 and compared to 84.2% at securitization.  Moody's is
upgrading Classes B, C and D due to increased credit support,
defeasance and stable overall pool performance.  

Class B was upgraded on Aug. 2, 2006 and placed on review for
further possible upgrade based on a Q tool based portfolio review.  
Moody's is downgrading Classes K, L, M, and N due to realized and
expected losses from the specially serviced loans.  Class P has
been eliminated in its entirety due to losses and Class N has
sustained approximately $4.1 million in losses.

The top four non-defeased loans represent 12.4% of the pool.  

I

The largest loan is the 1615 Poydras Street Loan ($27.7 million -
4.5%), which is secured by a 502,000 square foot office building
located in the Warehouse District of New Orleans, Louisiana.
Damage from Hurricane Katrina has been repaired and the property
is fully operational.  The largest tenant is FM Services Company,
which occupies 61% of the premises under a lease that expires in
April 2011.  The property is 89% leased, compared to 90.4% at last
review.  Moody's LTV is 91.2%, compared to 76.4% at last review.

II

The second largest loan is the Western Plaza II Loan
($17.9 million - 2.7%), which is secured by a 343,000 square foot
strip shopping center located in Mayaguez, Puerto Rico.  The
center is anchored by Sam's Club, Caribbean Cinemas and Pep Boys.
The center is also shadow anchored by a Super Kmart.  The property
has maintained a stable occupancy since securitization and is
currently 98.6% leased.  Moody's LTV is 80.2%, compared to 83.1%
at last review.

III

The third largest loan is the Red Lion Shopping Center Loan ($16.1
million - 2.6%), which is secured by a 218,000 retail center
located 10 miles northeast of downtown Philadelphia, Pennsylvania.  
The property is anchored by Best Buy, Staples and Pep Boys.  The
property is currently 67.0% occupied, compared to 100.0% at last
review.  The decline in occupancy is due to the 2005 lease
expiration of two tenants.  The loan is on the master servicer's
watchlist due to declines in occupancy and a low debt service
coverage ratio.  Moody's LTV is in excess of 100%, compared to
88.6% at last review.

IV

The fourth largest loan is the Diamond Point Plaza Loan
($14.6 million - 2.4%), which is secured by a 251,000 retail
center located in suburban Baltimore, Maryland.  The loan was
transferred to special servicing in June 2002 and became REO in
March 2006.  The loan was transferred due to the unexpected
vacancy of Sam's Club which went dark in 2002 although it
continues to pay rent (56% GLA; lease expiration January 2009).  
Ames, formerly the second largest tenant, also vacated its space
prior to its lease expiration.  The property is currently
67% leased but only 5.5% occupied. The Trust was awarded a
$22.8 million judgment against the borrower and its affiliates in
December 2005 and successfully won the appeal in Sept. 2006,
defeating the debtors' attempts to have the judgment overturned.  
Moody's anticipates a significant loss upon the resolution of this
loan, although the loss could be partially or substantially
mitigated if the special servicer is successful in its efforts to
collect on the judgment.

The pool collateral is a mix of office, U.S. Government
securities, retail, industrial and self storage, multifamily,
lodging, and healthcare.  The collateral properties are located in
39 states and Puerto Rico.


SMALL WORLD: Posts $4.9 Million Net Loss in 2006 Second Quarter
---------------------------------------------------------------
Small World Kids, Inc. reported a $4,946,290 net loss on
$5,461,958 of sales for the quarter ended June 30, 2006, compared
to a $1,804,979 net loss on $6,164,399 of sales for the same
period in 2005.    

At June 30, 2006, the company's balance sheet showed $21,949,207
in total assets, $20,492,009 in total liabilities, and $1,457,198
in total stockholders' equity.  Additionally, the company's
accumulated deficit worsened to $19,485,784 as of June 30, 2006.

                           Going Concern
                           
Stonefield Josephson, Inc. of Los Angeles, Calif., expressed
substantial doubt about Small World Kids, Inc.'s ability to
continue as a going concern after auditing the company's financial
statements for the year ended Dec. 31, 2005.  The auditing firm
pointed to the company's principal debt obligations of
$4.7 million due in 2006, significant net losses since inception,
as well as the company's accumulated deficit of $10 million and
cash used for operating activities during the year ended Dec. 31,
2005, amounting to $2.7 million.

                          About Small World
                         
Headquartered in Nevada, Small World Kids, Inc., --  
http://www.smallworldkids.net/-- formerly known as SavOn Team  
Sports, Inc., acquired Fine Ventures, LLC, a Nevada limited
liability company, and Small World Toys, a California corporation
in May 2004.  The company is now a holding company and has no
significant business operations or assets other than their
interest in Small World Toys.  Fine Ventures LLC is a wholly owned
subsidiary with no business operations or assets.  Since the
acquisition of Small World Toys, the company has been engaged in
the development, manufacturing, marketing and distribution of
educational and developmental toys.

In September 2004, Small World Toys acquired certain assets of
Neurosmith LLC including electronic learning and related
intellectual property, prototypes, models, chips and miscellaneous
assets.  On June 24, 2005, the company acquired certain assets of
Imagiix LP including intellectual property and miscellaneous
assets.


STRUCTURED ASSET: Fitch Downgrades Ratings on Five Cert. Classes
----------------------------------------------------------------
Fitch downgrades five and affirms 15 classes of Structured Asset
Securities Corp. residential mortgage-backed certificates:

Series 2001-8A Pools 1-3

     -- Classes 1A, 2A, 3A affirmed at 'AAA';
     -- Classes B1-I, B1-IX affirmed at 'AAA';
     -- Class B2-I affirmed at 'AAA';
     -- Class B3-I affirmed at 'A+';
     -- Class B4-I downgraded to 'B' from 'BB-';
     -- Class B5-I remains at 'C/Distressed Recovery (DR)5'.

Series 2002-22H Group 1

     -- Class 1A affirmed at 'AAA';
     -- Class B1-I affirmed at 'AA';
     -- Class B2-I affirmed at 'A';
     -- Class B3-I affirmed at 'BBB';
     -- Class B4-I downgraded to 'B' from 'BB';
     -- Class B5-I downgraded to 'C/DR6' from 'CCC/DR2'.

Series 2002-22H Group 2

     -- Class 2A affirmed at 'AAA';
     -- Class B1-II affirmed at 'AA';
     -- Class B2-II affirmed at 'A';
     -- Class B3-II affirmed at 'BBB';
     -- Class B4-II downgraded to 'B' from 'BB';
     -- Class B5-II downgraded to 'C/DR6' from 'CCC/DR2'.

The negative rating action affects $508,375 of outstanding
certificates and is the result of cumulative pool losses and high
delinquency levels.  The affirmations reflect credit enhancement
consistent with future loss expectations and affect approx. $34.27
million of outstanding certificates.  The transactions are
seasoned from 48 (series 2002-22H) to 65 months (series 2001-8A).  
The pool factors (current principal balance as a percentage of
original) range from less than 2% for series 2001-8A pools 1-3 to
13% for series 2002-22H group 1.

Series 2002-22H consists of two mortgage groups.  Associated with
each of these two mortgage groups are component certificate
classes B3 through B6.  Each group of components is backed by a
separate mortgage group (e.g., B3-I group 1, B3-II group 2).  
Therefore, each component performs differently, based on the
performance of its underlying pool.  However, since the components
are not severable, each rated class (e.g. B3, B4, B5) reflects the
performance of the weakest of all of its components.  In this
transaction, mortgage group 1 is the poorest performer and as
such, mortgage group 1's components (i.e., B3-I group 1, B4-I  
group 1, B5-I group 1) determine the ratings of each entire class.
Oct. 25, 2006 remittance information for mortgage group 1
indicates that 2.1% of the pool is currently over 90 days
delinquent and cumulative losses are 0.09% of the original pool
balance.  Realized losses have averaged $6,699 a month over the
past three months.  Class B4-I currently has 0.24% ($74,548) of
credit support remaining (originally 0.20% or $502,615).  Class
B5-I currently has no support remaining (originally 0.10% or
$252,615).

Oct. 25, 2006 remittance information for Series 2001-8A pools 1-3
indicates that 5.74% of the pool is currently over 90 days
delinquent and cumulative losses are 0.14% of the original pool
balance.  Realized losses have averaged $4,427 a month over the
past three months.  Class B4-I currently has 1.49% ($49,583) of
credit support remaining (originally 0.25% or $555,608).  Class
B5-I currently has no support remaining (originally 0.15% or
$337,608).

The collateral consists of adjustable or fixed rate, conventional,
fully amortizing first lien residential mortgage loans.  
additionally, all of the mortgage loans have a weighted average
original loan to value ratio in excess of 100%.  The mortgage
loans generally are covered by primary mortgage insurance polices
issued by either United Guaranty Corporation in connection with
the Borrower Advantage Program, or Mortgage Guaranty Insurance
Corporation in connection with the Pro Mortgage Program.  The
mortgage loans are master serviced by Aurora Loan Services, Inc.,
which is rated 'RMS1-' by Fitch.


TIME WARNER: Buys Xspedius Communications for $216 Million in Cash
------------------------------------------------------------------
Time Warner Telecom Inc., has completed its acquisition of
Xspedius Communications, LLC.

Pursuant to the terms of the merger agreement, the Company issued
18,249,428 shares of Class A Common Stock and paid $216 million in
cash, including an adjustment for working capital.  The Company
assumed no debt in the transaction.

"We continue to believe in the value of the last mile connectivity
to enterprise customers, and this acquisition further expands our
network reach and market density, enhancing our ability to further
fuel enterprise growth," Larissa Herda, chairman, chief executive
officer and president, said.  "We have been preparing for the
integration of the two companies, and look forward to achieving
the synergistic capabilities of the powerful combined fiber
footprint and advanced network solutions created by the merger of
both operations."

Concurrent with the closing of the Xspedius acquisition, the
Company's wholly owned subsidiary, Time Warner Telecom Holdings
Inc., drew down the balance of its secured Term Loan B credit
facility.  The draw down was used to fund the $250 million
redemption, including the redemption fees and accrued interest, of
its $240 million principal amount Second Priority Senior Secured
Floating Rate Notes due 2011 to be paid on Nov. 6, 2006, and
$150 million was used to fund a portion of the acquisition.

Headquartered in Littleton, Colorado, Time Warner Telecom Inc.
(Nasdaq: TWTC) -- http://www.twtelecom.com/-- provides data,  
dedicated Internet access, and local and long distance voice
services to business customers in 44 metropolitan markets in the
United States.  Xspedius, a privately held telecommunications
company, is headquartered in O'Fallon, Montana.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 13, 2006
Moody's Investors Service took these rating actions on Time Warner
Telecom, Inc.: Speculative grade liquidity rating upgraded to
SGL-1 from SGL-2; corporate family rating affirmed at B2;
Convertible senior notes due 2026 affirmed at Caa1 and assigned
LGD5 rating, indicating noteholders could experience an 89% loss
in the event of a default.


UNITEDHEALTH GROUP: CalPERS Wants to Block CEO's Retirement Pay
---------------------------------------------------------------
The California Public Employees' Retirement System asks the U.S.
District Court in Minnesota a preliminary injunction to block
UnitedHealth Group Inc.'s outgoing chief executive, William
McGuire from collecting his retirement package.

Mr. McGuire will step down on Dec. 1, 2006, and will get as much
as $1.1 billion in stock options, retirement pay, and other
benefits, according to the Wall Street Journal, based on an
examination of securities filings.

David Brodsky, Esq., Mr. McGuire's attorney, is preparing a
response to CalPERS, Reuters reports.

                     About UnitedHealth Group

Minneapolis, Minn.-based UnitedHealth Group Inc. (NYSE: UNH) --
http://www.unitedhealthgroup.com/-- offers a broad spectrum of  
products and services through six operating businesses:
UnitedHealthcare, Ovations, AmeriChoice, Uniprise, Specialized
Care Services and Ingenix.  Through its family of businesses,
UnitedHealth Group serves approximately 70 million individuals
nationwide.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 31, 2006,
UnitedHealth received a purported notice of default on Aug. 28,
2006, from persons claiming to hold certain of its debt securities
alleging a violation of the Company's indenture governing its debt
securities.

The notice came following the Company's failure to file its
quarterly report on Form 10-Q for the quarter ended June 30, 2006,
with the U.S. Securities and Exchange Commission.

The Company asserted it is not in default.  The Company's
indenture requires it to provide to the trustee copies of the
reports the Company is required to file with the SEC, such as its
quarterly reports, within 15 days of filing those reports with the
SEC.

The Company has delayed the filing of its financial results in
light of an independent review of the company's stock option
programs from 1994 to present.


UNITEDHEALTH GROUP: Earns $1.101 Billion in Third Quarter of 2006
-----------------------------------------------------------------
UnitedHealth Group Inc. achieved record results in the third
quarter ended Sept. 30, 2006.  Diversified business growth was
well-matched with effective cost management, advances in the
integration of acquisitions and accelerating gains in
profitability from seasonally strong product offerings in the
third quarter, leading to a further advance in the Company's full-
year earnings outlook.

                   UnitedHealth Group Highlights

   -- Third quarter consolidated net earnings increased to
      $1.101 billion, up $301 million or 38% year-over-year and
      $127 million or 13% from the second quarter of 2006.

   -- Consolidated revenues of $18.0 billion increased
      $6.4 billion or 55% year-over-year, and $91 million or 1%
      from the second quarter of 2006.  Excluding acquisitions,
      third quarter revenues increased 20% on a year-over-year
      basis.

   -- The Company expanded its reach to more than 4 million
      entirely new individuals through the first nine months of
      2006, with strong growth achieved across employer health
      benefits programs, senior and government services offerings,
      and specialty product lines.

   -- Consolidated earnings from operations increased to
      $1.9 billion in the third quarter, up $551 million or
      42% over the prior year and up $225 million or 14%
      sequentially.

   -- Consolidated third quarter operating margin improved to
      10.3% from 9.1% in the second quarter of 2006, reflecting
      diversified growth coupled with effective continuing cost
      management and improved underlying business performance in
      multiple businesses.  The year-over-year operating margin
      decrease of 100 basis points was due to business mix changes
      driven by the commencement of the Company's Medicare Part D
      offerings and the acquisition of PacifiCare Health Systems
      (PacifiCare).

   -- Third quarter operating costs of $2.6 billion decreased by
      $60 million from their level in the second quarter
      of 2006.  Operating costs declined to 14.3% of revenues in
      the third quarter, an improvement of 110 basis points from
      the third quarter of 2005 and 40 basis points from the
      second quarter of 2006.

   -- Third quarter operating costs included an insurance recovery
      of approximately $40 million received by the Company's
      PacifiCare entity and a contribution to the United Health
      Foundation of more than $20 million.

   -- The consolidated medical care ratio (medical costs as a
      percentage of premium revenues), which includes all
      businesses and products, declined 50 basis points on a
      sequential quarter basis to 81.1%.  As expected, on a
      year-over-year basis the consolidated medical care ratio
      increased due to the impact of the acquisition of PacifiCare
      and the commencement of Medicare Part D.

   -- Consolidated medical costs payable, excluding the AARP
      division of Ovations, increased to $7.3 billion at
      Sept. 30, 2006.  Medical costs days payable was 54 days at
      Sept. 30, 2006, as compared to 53 days payable at June 30,
      2006.

   -- During the third quarter, the Company realized net favorable
      development of $10 million in its previous estimates of
      medical costs incurred in 2005.  The Company also realized
      $70 million in net favorable development related to
      estimates of medical costs incurred in the first two
      quarters of 2006.

   -- Accounts receivable, excluding the AARP division of
      Ovations, were $788 million at Sept. 30, 2006, and
      represented 4 days sales outstanding.

   -- Reported cash flows from operations were $315 million for
      the third quarter, bringing year-to-date operating cash
      flows to $4.92 billion.  Adjusted to align CMS payment
      timing to the proper periods, third quarter cash flows from
      operations were $1.83 billion, up 121% year-over-year.

   -- Third quarter 2006 annualized return on equity was 23%, up
      1% from the second quarter of 2006.

   -- The Company is likely to delay the filing of its quarterly
      reports on Form 10-Q for the second and third quarters of
      2006, in order to complete its analysis of its previously
      filed financial statements in light of the Independent
      Committee of the Board's report on stock option practices.

Stephen J. Hemsley, president and chief operating officer, stated,
"The broad and evolving health care markets are increasingly
engaging the capabilities which we have cultivated, even as our
business execution steadily continues to improve.  

"We anticipate continued strong growth into 2007, with total
revenues in the area of $79 billion and 2007 earnings per share
growth of 15% above the range of $2.95 to $2.97 per share we now
project for 2006."

                     Comment on Board Actions

Richard Burke, chairman of the Board of Directors of UnitedHealth
Group, said, "The actions we announced last week establish a
blueprint for the Company's governance and internal controls.

"We deeply regret the deficiencies relative to our historical
stock option programs cited in the Independent Committee's report
and apologize to all our stakeholders for them.

"The actions we adopted are designed to help ensure that
UnitedHealth Group meets the highest possible standards of
corporate governance, in compensation matters and other areas.

"The Board unanimously appointed Steve Hemsley as CEO after fully
considering his strong performance at the Company and all facts
pertaining to the Independent Committee's review.

"Each of the directors believes that our decision and Steve's
leadership are in the best interests of UnitedHealth Group, our
employees, customers, and shareholders.  Steve will be a strong
and capable leader for UnitedHealth Group's future."

                     About UnitedHealth Group

Minneapolis, Minn.-based UnitedHealth Group Inc. (NYSE: UNH) --
http://www.unitedhealthgroup.com/-- offers a broad spectrum of  
products and services through six operating businesses:
UnitedHealthcare, Ovations, AmeriChoice, Uniprise, Specialized
Care Services and Ingenix.  Through its family of businesses,
UnitedHealth Group serves approximately 70 million individuals
nationwide.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 31, 2006,
UnitedHealth received a purported notice of default on Aug. 28,
2006, from persons claiming to hold certain of its debt securities
alleging a violation of the Company's indenture governing its debt
securities.

The notice came following the Company's failure to file its
quarterly report on Form 10-Q for the quarter ended June 30, 2006,
with the U.S. Securities and Exchange Commission.

The Company asserted it is not in default.  The Company's
indenture requires it to provide to the trustee copies of the
reports the Company is required to file with the SEC, such as its
quarterly reports, within 15 days of filing those reports with the
SEC.

The Company has delayed the filing of its financial results in
light of an independent review of the company's stock option
programs from 1994 to present.


UNITED KAISER: Case Summary & Eight Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: United Kaiser Services, LLC
        1001 Stephenson
        Norway, MI 49870

Bankruptcy Case No.: 06-26217

Chapter 11 Petition Date: November 1, 2006

Court: Eastern District of Wisconsin (Milwaukee)

Debtor's Counsel: Paul G. Swanson, Esq.
                  Steinhilber, Swanson, Mares, Marone & McDermott
                  107 Church Avenue, P.O. Box 617
                  Oshkosh, WI 54903-0617
                  Tel: (920) 426-0456
                  Fax: (920) 426-5530

Total Assets: $1,079,004

Total Debts:  $2,081,153

Debtor's Eight Largest Unsecured Creditors:

   Entity                        Nature of Claim     Claim Amount
   ------                        ---------------     ------------
North American Hydro             Unsecured Loan and      $604,226
Holdings, Inc.                   and Trade Debt
116 State Street
P.O. Box 167
Neshkoro, WI 54960-0167

United Construction              Trade Debt              $459,060
4830 Brookside Road
Abrams, WI 54101

North American Hydro             Unsecured Loan and      $440,526
Operations, LLC                  and Trade Debt
116 State Street
P.O. Box 167
Neshkoro, WI 54960-0167

Kiser Johnson Company            Unsecured Debt          $100,000
N15847 Gustafson Road
Vulcan, MI 49892

Kiser Enterprises, LLC           Business Real           $427,871
N15847 Gustafson Road            Estate (appraisal       Secured:
Vulcan, MI 49892                 pending)                $350,000

Jeff Kiser                       Unsecured Debt           $38,611

J.R. Enterprises                 Trade Debt                $9,758

William D. Harris                Unsecured Loan            $1,100


USA COMMERCIAL: Judge Riegle Disapproves Chapter 7 Conversion
-------------------------------------------------------------
The Honorable Linda B. Riegle of the U.S. Bankruptcy Court for the
District of Nevada rejected USA Commercial Mortgage Company, fka
USA Capital's, and its debtor-affiliates' motion to convert their
chapter 11 cases to chapter 7 liquidation proceedings, the Las
Vegas Review-Journal reports.

Judge Riegle, in an interview with Las Vegas Review, said that the
chapter 7 conversion of the Debtors' estate would be devastating.  
Judge Riegle said a conversion could discourage potential buyers
from taking over USA Capital.

According to the report, lawyers and creditor committees objected
to the conversion proposed by August Landis, an assistant U.S.
Trustee assigned in the Debtors' cases.  Mr. Landis stated that
federal law gave him no option but to seek for a conversion.  USA
Capital had little chance of being rehabilitated into an ongoing
business, he argued.

Reports indicated that the Nevada Mortgage Lending Division has
suspended the Company's right to originate new loans and the USA
Commercial Mortgage, which services the trust deeds, disclosed an
operating loss of $36 million in July and $1.4 million in August.

Mr. Landis asserted the losses were shrinking remaining assets
available for creditors.

Annette Jarvis, Esq., at Ray Quinney & Nebeker P.C., counsel for
the Debtors, countered Mr. Landis' claims, saying the operating
losses did not reflect assets that interim managers have marshaled
since April.

Ms. Jarvis contended that an interim management team led by
restructuring chief Thomas Allison has collected $145 million in
principal payments and $38 million in interest.  She added that,
USA Commercial has received $2.7 million in servicing fees,
$1.2 million in other fees and $14.5 million in prepaid interest.

Furthermore, Ms. Jarvis counted outstanding loans totaling
$791 million as of Sept. 30, 2006, and said that Mr. Allison
expects to cut to 55 number of outstanding loans totaling
$469 million by Jan. 1, when a buyer takes over the assets of USA
Capital First Trust Deeds, one of two mortgage pools operated by
the Company, and starts servicing loans.

Las Vegas Review disclosed that USA Capital solicited money from
several thousand individual investors around the country and used
the money to make short-term mortgage loans to commercial
developers, including Tom Hantges and Joe Milanowski, USA Capital
owners.

                      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.


VARIG S.A.: Foreign Rep Objects to Port Authority's Payment Motion
------------------------------------------------------------------
Eduardo Zerwes, the Foreign Representative of VARIG S.A. and its
debtor-affiliates, objects to The Port Authority of New York and
New Jersey's request to compel the Foreign Debtors to pay
postpetition flight fees and other fees totaling $207,500 as an
administrative expense pursuant to Sections 105, 503 and 507 of
the Bankruptcy Code.

While VARIG, S.A., acknowledges the debts mentioned by the Port
Authority of New York and New Jersey -- except that it does not
have a record of an invoice for a $250 Supplemental Flight Fee --
Mr. Zerwes asserts that Sections 503 and 507 of the Bankruptcy
Code do not apply in the ancillary case and allowance or
disallowance of the claims must be determined in the Foreign
Proceeding in Brazil.

Representing Mr. Zerwes, Rick B. Antonoff, Esq., at Pillsbury
Winthrop Shaw Pittman LLP, in New York, argues that:

   * the Port Authority's request improperly applies the
     Bankruptcy Code and lacks the necessary basis to support an
     order granting the relief it seeks; and

   * any order from the U.S. Court compelling payment of any
     claim is premature because claims should first be
     administered in accordance with VARIG's approved In-Court
     Reorganization Plan.

Specifically, Mr. Antonoff says, nothing in Sections 503 and 507
authorizes a U.S. court to direct payment of a claim in a case
that was commenced as an ancillary case under Section 304.  
Section 304(b) sets forth the relief that the Court may grant in
an ancillary case, and yet Section 304 is not mentioned in the
Port Authority's request other than in the caption and a
background recital.

Moreover, while Section 304 ancillary cases permit a court to
condition the continuation of a preliminary injunction to grant
certain relief, the court lacks jurisdiction to compel production
of assets administered in a foreign bankruptcy proceeding, Mr.
Antonoff explains.

Mr. Antonoff maintains that continuation of the Preliminary
Injunction should not be conditioned upon payment of a claim to
Port Authority.  Payment of any claim outside of the procedures
approved in VARIG's In-Court Recovery Plan would unfairly and
unduly prejudice other "bankruptcy creditors" that arose during
the Foreign Proceeding.

Mr. Antonoff further notes that the Reorganization Plan, which
was approved by creditors and the Brazilian Court on July 17,
2006, expressly sets forth the procedure for addressing all
"bankruptcy creditors" including Port Authority.  

The Reorganization Plan provides that the Foreign Debtors will
make available, within 90 days after approval of the Plan, a
"list of bankruptcy creditors and their credits".  Within 30 days
after the list is made available, "bankruptcy creditors wishing
to adhere to the Reorganization Plan shall do so pursuant to the
proper adhesion instrument."  Bankruptcy creditors who do not
state their adhesion to the Reorganization Plan remain creditors
of the Foreign Debtors and are entitled to receive payments
derived from the Foreign Debtors' remaining operating cash flow.

Since the Foreign Proceeding addresses treatment of the Port
Authority claim in a Reorganization Plan approved by creditors
and the Brazilian Court, the U.S. Court should not grant the Port
Authority's request, Mr. Antonoff says.

                   Port Authority Talks Back

Representing the Port Authority of New York and New Jersey,
Milton H. Pachter, Esq., points out that:

   * VARIG concedes that it owes the Port Authority $207,250;

   * since June 17, 2005, VARIG has benefited from the U.S.
     Court's protection with respect to its creditors'
     prepetition claims; and

   * VARIG continued to use John F. Kennedy International Airport
     as part of its operations in the United States in May, June
     and July 2006, and thus earned revenues from the flights.

Mr. Pachter further notes that 90 days have passed yet no "list
of bankruptcy creditors and their credits" has been issued.  No
specific date for the issuance of the list has been stated too.

"It seems to be questionable whether the Port Authority will have
any opportunity to pursue its post-petition claim in the
Brazilian Court," Mr. Pachter says.

The Port Authority believes that it should not be required to
litigate the matter in Brazil since VARIG expressly sought and
received the benefits of the U.S. Court with regard to the
issuance of a preliminary injunction.

Mr. Pachter contends that VARIG's argument that nothing in
Sections 503 and 507 authorize a U.S. court to direct payment of
a claim in a case commenced under Section 304, is disingenuous,
since Section 304 specifically provides that court determination
as to the relief it should grant should be guided, among other
things, "with the distribution of proceeds of such estate
substantially in accordance with the order prescribed by [the
Bankruptcy Code]."

For these reasons, the Port Authority asks the U.S. Court to
compel VARIG to immediately pay the $207,500 postpetition flight
fees, parking fees and charges that are presently owed.

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin America.
VARIG's principal business is the transportation of passengers and
cargo by air on domestic routes within Brazil and on international
routes between Brazil and North and South America, Europe and
Asia.  VARIG carries approximately 13 million passengers annually
and employs approximately 11,456 full-time employees, of which
approximately 133 are employed in the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a competitive
landscape, high fuel costs, cash flow deficit, and high operating
leverage.  The Debtors may be the first case under the new law,
which took effect on June 9, 2005.  Similar to a chapter 11
debtor-in-possession under the U.S. Bankruptcy Code, the Debtors
remain in possession and control of their estate pending the
Judicial Reorganization.  Sergio Bermudes, Esq., at Escritorio de
Advocacia Sergio Bermudes, represents the carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 33; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or    
215/945-7000)


WAVE WIRELESS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Wave Wireless Corporation
        fka PCom Inc.
        1996 Lundy Avenue
        San Jose, CA 95131

Bankruptcy Case No.: 06-11267

Type of Business: The Debtor is a wireless broadband developer.

Chapter 11 Petition Date: October 31, 2006

Court: District of Delaware

Judge: Peter J. Walsh

Debtor's Counsel: Anthony M. Saccullo, Esq.
                  Neal J. Levitsky, Esq.
                  Fox Rothschild LLP
                  919 N. Market Street, Suite 1300
                  P.O. Box 2323
                  Wilmington, DE 19899
                  Tel: (302) 622-4212
                  Fax: (302) 656-8920

Total Assets: $1,000,000

Total Debts:  $5,000,000

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Vodafone                      Prepayment for            $686,423
Dept. FMT                     support services
AM Seestern 1
Dusseldorf, Germany 40547

MynTahl Corporation           Suite for breach of       $626,865
c/o James Cai                 contract
Schein & Cai LLP
100 Century Center Group,
Suite 315
San Jose, CA 95122

Siemens AG                    Promissory Note           $350,000
ICN CN 1 BA B
D81730
Munich, Germany

Able Electronics              Promissory Note           $300,000
31033 Huntwood Avenue
Hayward, CA 94544

Tax Collector                 Property taxes            $101,798
Santa Clara County
70 W. Hedding Street, East
Wing
San Jose, CA 95110

Inland Revenue                VAT                        $89,592
P.O. Box 3900
Glasgow, UK
G70 6AA

United Manufacturing          Trade debt                 $89,592
Assembly
44169 Fremont Blvd.
Fremont, CA 94538

Property Tax Assistance Co.   Trade debt                 $44,252
16600 Woodruff Ave., Suite
200
Bellflower, CA 90706

Hytegrity                     Trade debt                 $36,142
Yerevan, Armenia

Bryan Family Partnership      Rent                       $25,349
c/o Toeniskoeeter & Breeding
The Alameda, Suite 20
San Jose, CA 95126

Thomson Financial/Carson      Trade debt                 $22,500
P.O. Box 5137
Carol Stream, IL 60197

Pluris Partners, Inc.         Settlement agreement       $16,500
33 E. Robinson Street
Orlando, FL 32801

Alburger Basso de Grosz       Trade debt                 $16,407
550 Montgomery Street, 3rd
Floor
San Francisco, CA 94111

VSoft, Inc.                   Trade debt                 $14,741
12930 Saratoga Avenue
Suite B1
Saratoga, CA 95070

J.D. Myers II                 Former employee            $14,092
8204 Meadowfield Way          expenses
Laurel, MD 20708

Avaya, Inc.                   Trade debt                 $13,632
PO Box 5125
Carol Stream, IL 60197

Purolator Courier             Shipping                   $13,342
P.O. Box 1100
Postal Station A
Etobicoke, Ontario, Canada
M9C 5K2

Smart Networks                Trade debt                 $12,962
Zaragoza #25
Col Santa Cruz Atoyac, C.P.
03310 Deleg. Benito Jaurez,
Mexico, D.F.

Endwave Corporation           Trade debt                 $10,000
File 56297
Los Angeles, CA 9007

Amphenol Antel, Inc.          Trade                       $8,280
1300 Capital Drive
Rockford, IL 61109


WELD WHEEL: Court Okays Spencer Fane as Committee's Lead Counsel
----------------------------------------------------------------
The Honorable Jerry W. Venters of the U.S. Bankruptcy Court for
the Western District of Missouri in Kansas City authorized the
Official Committee of Unsecured Creditors appointed in Weld Wheel
Industries Inc., and its debtor-affiliates' bankruptcy cases to
retain Spencer Fane Britt & Browne LLP as its counsel.

As reported in the Troubled Company Reporter on Sept. 13, 2006,
Spencer Fane will:

    a. advise the Committee with respect to its rights, duties and
       powers as an official unsecured creditors' committee;

    b. advise the Committee with respect to terms, conditions and
       documentation of financing agreements, cash collateral
       orders and related transactions;

    c. advise the Committee in connection with any potential sale
       of assets or businesses;

    d. investigate the nature and validity of liens asserted
       against Debtors' assets and to advise the Committee
       concerning the enforceability of these liens;

    e. investigate and advise the Committee with respect to the
       taking of actions necessary to collect and, in accordance
       with applicable law, recover property for the benefit of
       the estates;

    f. prepare and submit on behalf of the Committee, among other
       things, applications, motions, pleadings, orders, notices,
       schedules and other legal papers to be prepared and
       submitted in the Debtors' case, and review financial
       and other reports;

    g. advise the Committee concerning and to prepare responses to
       applications, motions, pleadings, notices and other
       documents;

    h. counsel the Committee in connection with the formulation,
       negotiation and promulgation of a plan or plans of
       reorganization and related documents;

    i. appear on behalf of the Committee at all hearings scheduled
       before the Court;

    j. review pending litigation and evaluating and advising the
       Committee concerning appropriate actions to be taken under
       the circumstances; and

    k. represent the Committee, and perform all other legal
       services for the Committee that may be necessary, in
       connection with this case.

The current hourly billing rates for Spencer Fane's professionals
are:

       Designation                  Hourly Rate
       -----------                  -----------
       Partners                     $260 - $410
       Associates                   $195 - $250
       Paralegals                   $110 - $140

Lisa A. Epps, Esq., at Spencer Fane, assured the Court that the
firm does not hold any interest adverse to the Debtors' estates
and is disinterested pursuant to Section 101(14) of the Bankruptcy
Code.

Kansas City, Missouri- based Weld Wheel Industries, Inc., nka XWW
Inc. -- http://www.weldracing.com/-- manufactures forged alloy
wheels to enhance the performance and appearance of racecars, off-
road trucks, luxury pickups, SUV's, premium motorcars, customs,
hot rods, and motorcycles.  Weld Wheel and its two debtor-
affiliates filed for Chapter 11 protection on Aug. 17, 2006 (Bankr
W.D. Mo. Case No. 06-42105).  Cynthia Dillard Parres, Esq., and
Laurence M. Frazen, Esq., at Bryan Cave LLP, represent the
Debtors.  Lisa A. Epps, Esq., at Spencer Fane Britt & Browne LLP
and Kim Martin Lewis, Esq., at Dinsmore & Shohl LLP represent the
Official Committee of Unsecured Creditors.  Mesirow Financial
Consulting LLC gives financial advice to the Committee.  When the
Debtors sought protection from their creditors, they estimated
assets and debts at $10 million to $50 million.


WELD WHEEL: Ct. OKs Mesirow Financial as Panel's Financial Advisor
------------------------------------------------------------------
The Honorable Jerry W. Venters of the U.S. Bankruptcy Court for
the Western District of Missouri in Kansas City authorized the
Official Committee of Unsecured Creditors appointed in Weld Wheel
Industries Inc., and its debtor-affiliates' bankruptcy cases to
retain Mesirow Financial Consulting LLC as its financial advisors,
nunc pro tunc to Aug. 29, 2006.

As reported in the Troubled Company Reporter on Sept. 19, 2006,
Mesirow Financial will:

     a) analyze the Debtors' procedures and status regarding the
        proposed Section 363 sale to American Racing Equipment,
        Inc.;

     b) review due diligence procedures currently in place and
        make any additional recommendations to the Committee;

     c) assist with the analysis and evaluation of potential
        competing bids in regards to the Section 363 sale;

     d) assist in the review of reports or filings as required by
        the Bankruptcy Court or the Office of the United States
        Trustee, including, but not limited to, schedules of
        Assets and liabilities, statements of financial affairs
        and monthly operating reports;

     e) review of the Debtors' financial information, including,
        but not limited to, analyses of cash receipts and
        disbursements, financial statement items and proposed
        transactions for which Bankruptcy Court approval is
        sought;

     f) review and analyze the Debtors' reporting regarding cash
        collateral and any debtor-in-possession financing
        arrangements and budgets; and

     g) perform other functions as requested by the Committee or
        its counsel to assist the Committee.

Mesirow Financial will be compensated a fixed fee of $75,000 for
its evaluation of the 363 Sale process for the period ending
Sept. 30, 2006.

Thomas D. Bibby, at Mesirow Financial, assured the Court that the
firm is disinterested pursuant to Section 101(14) of the
Bankruptcy Code.

Kansas City, Missouri- based Weld Wheel Industries, Inc., nka XWW
Inc. -- http://www.weldracing.com/-- manufactures forged alloy
wheels to enhance the performance and appearance of racecars, off-
road trucks, luxury pickups, SUV's, premium motorcars, customs,
hot rods, and motorcycles.  Weld Wheel and its two debtor-
affiliates filed for Chapter 11 protection on Aug. 17, 2006 (Bankr
W.D. Mo. Case No. 06-42105).  Cynthia Dillard Parres, Esq., and
Laurence M. Frazen, Esq., at Bryan Cave LLP, represent the
Debtors.  Lisa A. Epps, Esq., at Spencer Fane Britt & Browne LLP
and Kim Martin Lewis, Esq., at Dinsmore & Shohl LLP represent the
Official Committee of Unsecured Creditors.  Mesirow Financial
Consulting LLC gives financial advice to the Committee.  When the
Debtors sought protection from their creditors, they estimated
assets and debts at $10 million to $50 million.


WELLMAN INC: Poor Performance Cues Moody's to Lower Rating to B3
----------------------------------------------------------------
Moody's Investors Service downgraded Wellman, Inc.'s corporate
family rating to B3 from B2.  The ratings on Wellman's first lien
term loan due 2009 and second lien term loan due 2010 were
downgraded to B1 and Caa1 from Ba3 and B3, respectively.  

The company's ratings were also placed under review for further
possible downgrade.

These are the rating actions:

   -- Corporate family rating --B3 from B2

   -- $185 million First lien term loan due 2009 -- B1 from Ba3,
      LGD2, 29%

   -- $265 million Second lien term loan due 2010 -- Caa1 from
      B3, LGD5, 77%

The downgrade of the corporate family rating reflects Wellman's
low raw material margins, operating losses in each quarter of
2006, lack of free cash flow in 2006 and elevated leverage.  The
company has been subject to rising and volatile feedstock prices
and has not been able to raise prices to maintain sufficient
margins.

Additionally, volumes in its fiber business continue to decline.
The PET resin industry has suffered from Asian import competition
and capacity additions that have limited producers ability to
maintain adequate margins, conditions that are likely to worsen in
2007.

Funds from operations during 2006 have not been sufficient to meet
the company's elevated capital expenditures associated with the
PET resin capacity expansion at its Pearl River, MS plant,
sizeable working capital growth as a result of higher raw material
costs and the startup of new capacity, and hurricane Katrina
costs, resulting in an increase in debt of over
$100 million.

The continuing review will consider the impact of deteriorating
market conditions on the company's cash flows and its ability to
maintain compliance with its financial covenant in its revolver
over the next 12 months.  

Furthermore, it will examine the timing of several one-time cash
in-flows that are expected to occur over the next 12 months that
may improve the company's liquidity.  The company expects to
reduce costs and raise cash through the restructuring of its US
fibers operations and working capital reductions.  It is also
exploring strategic alternatives for its European operations.

Additionally, insurance proceeds covering hurricane Katrina costs
could benefit liquidity.


WESLEY TENNYSON: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Wesley J. Tennyson
        aka Wesley Tennyson
        aka Wes Tennyson
        aka Tennyson's Garage
        aka R/T Properties
        655 North Marion Avenue
        Jefferson, WI 53549
        Tel: (920) 674-2017

Bankruptcy Case No.: 06-12814

Chapter 11 Petition Date: November 1, 2006

Court: Western District of Wisconsin

Debtor's Counsel: Guy K. Fish, Esq.
                  Fish Law Offices
                  533 Vernal Avenue
                  Milton, WI 53563
                  Tel: (608) 868-3200
                  Fax: (608) 868-3208

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                              Claim Amount
   ------                              ------------
First National Bank                         $25,366
P.O. Box 3331
Omaha, NE 68103-0331

Robert J. Elliott, Esq.                     $18,645
117 West Milwaukee Street
Janesville, WI 53548-2913

Rock County Treasurer                       $16,794
P.O. Box 1975
Janesville, WI 53545

Chase Cardmember Services                   $15,250
P.O. Box 15548
Wilmington, DE 19886-5548

National City                               $14,425
Cardholder Services
P.O. Box 500
Portage, MI 49081-0500

Chase Sony Card                             $13,348

AT&T Universal Card                         $11,906

Sears Gold MasterCard                        $8,940

Fort Community Credit Union Mastercard       $7,997

Washington Mutual Card Services              $6,146

American Express - California                $5,396

American Express - Florida                   $5,296

GC Services L.P.                             $4,999

Discover Financial Services                  $4,890

Bank of America - Texas                      $4,655

Bank of America - Washington                 $3,821

Jefferson County Treasurer                   $2,951

E Trade Financial                            $1,943

State Collection Services                    $1,530

Neuberger, Wakeman, Lorenz,                  $1,515
Griggs, Sweet & Fischer


WINN-DIXIE: Court Approves Five Alabama Power Agreements
--------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
approved the agreements between Winn-Dixie Stores Inc. and its
debtor-affiliates and Alabama Power Company and directs the
Debtors to pay APCO $861,747 as cure relating to the assumption of
four contracts.

The Court rules that the Debtors cannot assume the Contracts if
their Joint Plan of Reorganization is not confirmed or does not
become effective.

As reported in the Troubled Company Reporter on Oct. 27, 2006,
the five contracts under which APCO provides electricity to
nearly 63 of the Debtors' operating locations in Alabama are:

   (a) Master Contract for Electric Service between APCO and
       Winn-Dixie Stores, Inc., dated May 16, 2002;

   (b) Master Contract for Electric Power Service between APCO
       and Winn-Dixie Montgomery, Inc., dated Feb. 23, 1996;

   (c) Master Contract for Electric Power Service between APCO
       and WD Montgomery dated Aug. 8, 1997, and associated
       Electric System Lease Agreement and Standby Generator
       Program Agreement each dated Sept. 3, 1997;

   (d) Contract for Electric Power between APCO and WD Montgomery
       dated April 15, 1997; and

   (e) Contract for Electric Power between APCO and WD Montgomery
       dated Nov. 5, 1996.

The parties have resolved their dispute with respect to the May
2002 Contract, and have also negotiated the terms pursuant to
which all of the Contracts will be assumed, except for the
November 1996 Contract.  The negotiations had resulted in these
agreements:

   (1) The Debtors will assume the February 1996, April 1997,
       September 1997, and May 2002 Contracts, as amended;

   (2) APCO will facilitate the assumption of the four Contracts
       by agreeing to (i) amend the May 2002 and February 1996
       Contracts by virtue of two separate contracts dated
       October 12, 2006, and (ii) accept $861,747 as cure for the
       four Contracts;

   (3) The Debtors' cure obligations will be limited to the
       payment of the $861,747 cure with APCO waiving any
       additional requirements under Section 365(b)(1) of the
       Bankruptcy Code as they relate to any prepetition defaults
       under the Contracts;

   (4) APCO's Agreements will not negate the impact of assumption
       on any claims held by the Debtors against APCO or
       otherwise expose APCO to potential preference actions with
       respect to payments made on account of the Contracts;

   (5) APCO will be entitled to an administrative claim for cure
       if any amounts become owing to it pursuant to Section
       502(h) of the Bankruptcy Code upon assumption of the
       Contracts;

   (6) The Omnibus Motion as it pertains to the May 2002 Contract
       and APCO's Objection will be deemed withdrawn; and

   (7) The Debtors will reject the November 1996 Contract as of
       Oct. 25, 2006, and APCO will have a prepetition non-
       priority unsecured rejection damages claim for $51,876.

The Debtors will also save an estimated $1,000,000 annually by
avoiding service price increases that they would otherwise have
to incur if they pursued a rejection and entered into new service
contracts with APCO.

The November 1996 Contract related to the provision of
electricity to one of the Debtors' closed stores in Montgomery,
Alabama.  The Debtors say that the contract's rejection is still
in their best interest although it will result in a $51,876
rejection of damages in favor of APCO, since that amount reflects
minimum charges that they are required to pay under the contract.

By rejecting the November 1996 Contract, the Debtors will ensure
that the charges are treated as a prepetition non-priority
unsecured claim rather than as an administrative claim to be paid
in cash.

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


WINN-DIXIE: Wants TRP-Held SRP Plan Assets Transferred
------------------------------------------------------
Conditioned on the occurrence of the effective date of their
Joint Plan of Reorganization, Winn-Dixie Stores, Inc., and its
debtor affiliates ask the U.S. Bankruptcy Court for the Middle
District of Delaware to direct the liquidation and transfer to
Winn-Dixie Stores, Inc., of the Winn-Dixie Supplemental Retirement
Plan's assets held in trust by T. Rowe Price Trust Company under
an agreement effective as of July 1, 1994.

Specifically, the Debtors ask the Court to direct the transfer to
Winn-Dixie of SRP assets held in trust by TRP within five
business days following the later of (a) the receipt by TRP of
notice from the Debtors of the occurrence of the Effective Date,
and (b) the receipt by TRP of a copy of the Transfer Order.

Before their bankruptcy filing, the Debtors maintained the SRP to
provide supplemental retirement benefits to participating
employees.  The SRP was intended to constitute an unfunded,
unsecured, deferred compensation plan, with benefits to be paid
from the Debtors' general assets.  To support their obligations
under the SRP, the Debtors elected to enter into the Trust
Agreement with TRP.

Although the Trust Agreement establishes a trust fund to hold SRP
plan assets, both the Trust Agreement and the SRP indicate that
the Debtors remain the owner of all Trust Assets and that Trust
Assets are subject to the claims of creditors in the event of the
Debtors' bankruptcy, Cynthia C. Jackson, Esq., at Smith Hulsey &
Busey, in Jacksonville, Florida, relates.  As of Oct. 18, 2006,
the Trust Assets had an approximate value of $16,200,000.

Under the Chapter 11 Plan, the SRP and related trust and
individual agreements, including the Trust Agreement, will be
terminated for all purposes as of the Effective Date, and all
claims of participants under the SRP will be discharged.  The
Debtors wish to have the Trust Assets available as a source of
funds as soon as possible following the Effective Date.

However, Section 9.2 of the Trust Agreement provides, in relevant
part, that when TRP determines that Winn-Dixie has filed for
bankruptcy, TRP will hold for the benefit of Winn-Dixie's
creditors all Trust Assets and will deliver them to satisfy the
claims of the Winn-Dixie creditors as directed by a court of
competent jurisdiction.  Hence, the Debtors are seeking a
Transfer Order from the Court to satisfy the requirement
contained in Section 9.2, Ms. Jackson explains.

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


WOLVERINE TUBE: Mulls Chapter 11 Filing
---------------------------------------
Wolverine Tube, Inc., provided an update on Wednesday regarding
its restructuring and rationalization program, which is designed
to strengthen the Company's balance sheet, reduce debt and enhance
its overall capital structure while continuing to serve and
support customers globally.

The Company and its advisors have been evaluating refinancing and
restructuring alternatives in anticipation of the upcoming
maturities of the Company's Secured Revolving Credit Facility and
Receivables Sale Facility in 2008 and its outstanding 7.375%
Senior Notes and 10.5% Senior Notes (collectively, the "Senior
Notes") in 2008 and 2009, as well as its future projected short-
term liquidity needs.  As part of that process, Wolverine
continues to be engaged in discussions with representatives of its
bondholders and other groups as to the most appropriate
transaction, if any, to reduce debt and maintain value for its
shareholders.

Wolverine has filed a Registration Statement on Form S-4 with the
Securities and Exchange Commission for an exchange offer and
consent solicitation to exchange newly issued equity and a new
issue of secured notes for the Company's Senior Notes, subject to
certain conditions, including a minimum tender condition and the
SEC's declaring the Registration Statement effective.  If the
Company does proceed with the exchange offer but conditions to the
exchange offer and consent solicitation are not satisfied, the
Company intends to pursue other alternatives, including, if
certain conditions are met, a prepackaged plan of reorganization
of Wolverine and certain of its subsidiaries.  

The Registration Statement filed Wednesday therefore includes
solicitation for a Prepackaged Plan under chapter 11 of the
Bankruptcy Code.

If pursued, the Prepackaged Plan would generally provide
substantially the same consideration to the holders of the Senior
Notes as would the consummation of the exchange offer and consent
solicitation.  Further, under the contemplated Prepackaged Plan,
all administrative claims, priority claims, secured claims and
general unsecured claims (other than with respect to the Senior
Notes), including trade claims, would be paid in full, and holders
of existing common stock would receive a pro rata share of a
percentage of the new common stock in certain circumstances.  

Chip Manning, Wolverine's President and Chief Executive Officer
stated, "Today's filing is another step in the Company's efforts
to improve its overall financial health.  It is important to note
that we are still continuing to explore a range of alternatives,
and no decision has been made on which course of action the
Company will ultimately take."

Manning added, "We continue to believe that liquidity is
sufficient to sustain our operations in the near- to mid-term.  
The Company's restructuring process should have no impact on our
day-to-day operations and our customers and vendors can continue
to rely on the same high quality service and relationships with
Wolverine that they have come to expect."

A full-text copy of the registration statement filed with the SEC
is available for free at http://researcharchives.com/t/s?145f

Wolverine Tube, Inc. -- http://www.wlv.com/-- supplies copper and  
copper alloy tube, fabricated products and metal joining products.


WOLVERINE TUBE: S&P Cuts Corp. Credit Rating to CC from CCC+
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Huntsville, Alabama-based Wolverine Tube Inc., to 'CC'
from 'CCC+', after Wolverine's exchange offer and solicitation of
consent filed with the SEC.  

The rating on the company's senior unsecured notes was also
lowered to 'C' from 'CCC'.

"The lower ratings on the notes reflect the distressed nature of
the proposed exchange and our belief that the value of the
exchange offer, if completed, is not equivalent to the value of
the original contracted amounts," said Standard & Poor's credit
analyst Lisa Tilis.

At the same time, S&P placed all of the ratings on CreditWatch
with negative implications pending the outcome of the proposed
restructuring, which could involve a Chapter 11 bankruptcy filing.

Wolverine proposes to offer a combination of newly issued common
stock and convertible preferred stock and new secured notes to
current holders of its $135 million 7.375% senior notes due August
2008 and $99 million 10.5% senior notes due April 2009.  The
exchange offer and consent solicitation is subject to certain
conditions, including a minimum tender condition.  The exchange
offer and consent solicitation is intended to reduce debt and
position Wolverine to continue its operational restructuring
efforts.

Also, if the requirements of the exchange offer are not met, the
company is soliciting acceptances of a prepackaged plan of
reorganization under Chapter 11.  The proposed terms for
noteholders under the prepackaged plan are substantially the same
as under the exchange offer and consent solicitation.
     
Wolverine is also continuing to explore other alternative
refinancing and restructuring options.  Standard & Poor's believes
that it is unlikely that the company will be able to secure such
financing in the absence of waivers for its current indentures
because of its very high debt leverage and weak operating results.

If the distressed exchange is completed, the corporate credit
rating will be lowered to 'SD', or selective default, and the
ratings on the exchanged notes will be lowered to 'D'.  

Also, if any interest payments are missed while the company is
preparing to effect the exchange or considering its financing
options, the relevant issue rating would be lowered to 'D', with
no likely impact on the corporate credit rating.  

Alternatively, if the prepackaged plan of bankruptcy is filed, all
ratings will be lowered to 'D'.


WOLVERINE TUBE: Bankruptcy Plan Prompts Junks Ratings by Moody's
----------------------------------------------------------------
Moody's downgraded the ratings of Wolverine Tube, Inc.'s senior
unsecured notes to Caa3 from Caa2 and its corporate family rating
to Caa2 from Caa1.  

The outlook for the company remains negative.

This action was prompted by Wolverine's announcement of a
restructuring and reorganization program that will involve a debt
for equity exchange to the company's current noteholders.  If the
company does not receive enough support for this offer, Wolverine
intends to pursue a prepackaged bankruptcy plan.

The downgrade reflects Moody's opinion concerning the impact of
the restructuring program on noteholders' ultimate recovery as
well as the overall financial strength of Wolverine.  Industry
competitive dynamics, volatility of raw material prices, and
Wolverine's liquidity were also considered in the assessment of
the company's ratings and rating outlook.

These ratings were downgraded:

   -- Corporate Family Rating, to Caa2 from Caa1

   -- Gtd. Sr. Unsec. 7.375% notes, $135 million due 2008, to
      Caa3 from Caa2 (LGD4 -- 62%)

   -- Gtd. Sr. Unsec. 10.5% notes, $99 million due 2009, to Caa3
      from Caa2 (LGD4 -- 62%)

Moody's previous rating action on Wolverine was the April 27, 2006
downgrade of its long-term debt ratings to Caa2 from Caa1 and its
corporate family rating to Caa1 from B3.

Wolverine is a North American manufacturer and distributor of
copper and copper alloy tube, fabricated products and metal
joining products, headquartered in Huntsville, Alabama.  Wolverine
generated $1.1 billion in revenues and a net loss of $45.3
million, for the nine months ended October 1, 2006 as compared to
revenues of $636 million and a net loss of $19.4 million realized
in the same period earlier.


* BOOK REVIEW: The Managerial Mystique: Restoring Leadership in
               Business
---------------------------------------------------------------
Author:     Abraham Zaleznik
Publisher:  Beard Books
Paperback:  320 pages
List Price: $34.95

Order your personal copy at
http://amazon.com/exec/obidos/ASIN/1587982811/internetbankrupt

"Business in America has lost its way ... desperately needing
leadership to face worldwide economic competition."

Zaleznik wrote these words in 1989 when The Managerial Mystique
was first published.  But his observation remains as true today as
it was then.

In 1989, the problems included high debt and the decline of major
industries such as steel and automobiles.  To these problems can
now be added outsourcing and the growing economic power of China
and India.  Zaleznik primarily attributes the weakened condition
of American business to errors in business management.

"The causes of this decline in competitiveness are complex, but at
the forefront is the attitude of American management," he says.
Mainly, management strayed from its critically important role of
encouraging, nurturing, and recognizing initiative and creativity
of individuals.

Instead, management concentrated myopically on restructuring,
lateral organization, communication, charismatic leadership, and
mergers and acquisitions.  While each of these strategies has a
place in the corporate world, they are not the basis for a strong
business that can compete effectively.  Zaleznik contends that it
is the relationship between management and employees that count
the most in generating the ideas, goals, cooperation, and
endurance that make a corporation competitive.

Zaleznik puts to good use his background in social psychology and
psychoanalysis to explore this essential, yet neglected, area of
business management.  Social psychology and psychoanalysis are not
normally associated with business management.  However, the author
applies these so-called "soft sciences" to business organizational
structures and processes.  He critiques business organizations and
their activities and management at all levels by looking at what
has been excluded that really accounts for the quality of a
business.

Zaleznik points to some high-profile examples to illustrate what
is wrong with American management.  One is Harold Geneen, the
former chief executive officer of ITT, who, the author says,
epitomized a managerial approach that stifled company energy and
potential.

According to Zaleznik, Geneen is one of the many business managers
who "have put their faith in numbers, managed by process, and
formed elaborate structures to get people to do the predictable
thing."

Geneen's perspective fails to acknowledge that there are
differences between one business and another.  That such a belief
-- easily disproved by experience -- has come to be the core
principle of American business evidences, to Zaleznik's mind, just
how far off course American business has strayed.

Zaleznik offers a business approach that concentrates on nurturing
creativity and moral connections among employees.  He recognizes
employees as individuals and as a corrective to business practices
gone awry.  The values advocated by Zaleznik should not be
regarded as an alternative technique or peripheral considerations.  
They are the basis of a strategy that all businesses need to
compete effectively.

A professor emeritus of Harvard Business School and a certified
psychoanalyst, Abraham Zaleznik has an international reputation
for his studies and teaching on social psychology in the business
setting and the characteristics of managers and leaders.

                             *********

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, Ronald C. Sy, 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 ***