TCR_Public/070213.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Tuesday, February 13, 2007, Vol. 11, No. 37

                             Headlines

ACIH INC: Moody's Affirms Junk Rating on Discount Notes
ADELPHIA COMMS: Effective Date of Reorganization Plan is Today
ADELPHIA COMMS: Wants TWC Stock Public Sale Procedures Approved
ADELPHIA COMMS: Wants to Implement 2007 Employee Incentive Program
ADVANCED MARKETING: Wants PGW Employee Retention Program Approved

ADVANCED MARKETING: NBN Files Bid to Buy PGW Distribution Rights
ADVANTA CORP: Earns $84.2 Million In Year Ended December 31
ALCATEL-LUCENT: Performed Well Despite Weak Results Says Fitch
AMERICAN TOWER: Fitch Lifts Senior Notes' Rating to BB+ from BB-
AMERIQUEST MORTGAGE: Moody's Places B1 Rated Certs. on Review

AMERISOURCEBERGEN: Earns $122.2 Million in Quarter Ended Dec. 31
ANDREW CORP: Charles Nicholas Retires as Chairman of the Board
ARAMARK CORP: Completes Merger with Private Investment Group
ARAMARK CORP: Fitch Rates $1.78 Bil. Senior Unsecured Notes at B-
ASARCO LLC: AR Sacaton, et al. Tap Baker Botts as Bankr. Counsel

ASARCO LLC: Committee Taps Bates White as Asbestos Consultant
AUDIO VISUAL: $60 Mil. Senior Secured Facility Rated B3 by Moody's
AVAYA INC: Earns $71 Million in Fiscal Quarter Ended December 31
ACXIOM CORP: Earns $24.9 Mil. in 3rd Fiscal Quarter Ended Dec. 31
BAUSCH & LOMB: Files 2005 Annual Report with SEC

CALPINE CORP: Court Approves Sutherland Asbill as Special Counsel
CENTRAL GARDEN: Reports $3 Million Net Loss for Qtr. Ended Dec. 30
CITIGROUP MORTGAGE: DBRS Rates $4.7 Mil. Class M-11 Certs. at BB
CONEXANT SYSTEMS: Earns $7.4 Million in Fiscal 2007 First Quarter
COUDERT BROTHERS: Accepting File Retrieval Notices Until April 30

CREDIT SUISSE: Moody's Holds Junk Rating on $19MM Class I Certs.
CREDIT SUISSE: Moody's Hold Rating on $18MM Class L Certs. at Ba1
CSFB ABS: S&P Cuts Rating on Series 2002-HE1 Class B Certs. to BB
DAVITA INC: Loan Add-on Cues S&P to Hold BB- Corp. Credit Rating
DAVITA INC: Moody's Rates New $400 Mil. Senior Unsecured Notes B1

DELPHI CORP: Wants to Sell Brake Hose Biz to Harco Mfg. for $9.8MM
EASTLAND CLO: $48 Million Class D Notes Rated BB by S&P
EASTMAN KODAK: Details Major Restructuring by End of 2007
EDDIE BAUER: CEO and Board Member Fabian Mansson Resigns
ELCOM INT'L: Selects John Halnen as Interim President & CEO

ESTERLINE TECH: S&P Affirms BB Long-Term Corporate Credit Rating
EXECUTE SPORTS: Sells Academy Snowboard Rights Back to Owners
EXIDE TECH: Posts $11.2 Million Net Loss in Quarter Ended Dec. 31
FLEXTRONICS:  Earns $119 Million Net Income in Qtr Ended Dec. 31
FLOWSERVE CORP: Fitch Rates Senior Secured Bank Facilities at BB

FOAMEX INT'L: Emerges from Chapter 11 Bankruptcy Protection
FULTON STREET: Fitch Cuts Rating on $5.9 Mil Class C Notes to B-
FUNCTIONAL RESTORATION: Trustee Wants Grobstein as Accountants
GEOEYE INC: Pays $50 Million Loan Used to Acquire Space Imaging
GLOBAL POWER: Has Until April 26 to File Chapter 11 Plan

GLOBAL TEL*LINK: Moody's Holds Corporate Family Rating at B1
GNC CORP: Possible Company Sale Cues S&P's Negative CreditWatch
GRANT FOREST: S&P Cuts Long-Term Corporate Credit Rating to 'B+'
GSAMP TRUST: Moody's Rates Class B-2 Certificates at Ba2
GSC PARTNERS: Moody's May Upgrade Ba3 Rating on $10MM Cl. B Notes

GSMSC NET: Moody's Puts Low-B Ratings on Class N3 and N4 Notes
HERTZ CORP: Additional Debt Cues S&P's BB- Corporate Credit Rating
IFM COLONIAL: S&P Places Corporate Credit Rating at 'BB+'
JUNIPER NETWORKS: Stock Options Probe Cues S&P's Negative Watch
KYPHON INC: Moody's Lifts B1 Rating on $300 Mil. Senior Revolver

LAIDLAW INTERNATIONAL: FirstGroup To Purchase Shares for $3.6 Bil.
LAIDLAW INT'L: Merger Does Not Affect Low-B Ratings, Moody's Says
LB-UBS: Moody's Holds Junk Rating on $4.9 Million Class N Certs.
LB-UBS: S&P Assigns Low-B Ratings to $51 Million Debentures
LEAR CORP: Carl Icahn Deal Prompts S&P's Negative CreditWatch

LEVEL 3 COMM: Posts $237 Million Net Loss in Quarter Ended Dec. 31
MAGNOLIA VILLAGE: Wants Plan Confirmation Date Moved to June 5
MERITAGE HOMES: Fitch Holds Unsecured Credit Facility Rating at BB
MERRILL LYNCH: Moody's Affirms B2 Rating on $5 Mil. Class G Certs.
MORGAN STANLEY: Moody's Lifts Junk Rating on Class G Certs. to B2

MORGAN STANLEY: S&P Rates $9 Million Class Q Certificates at B-
NASDAQ STOCK: Fails in $5.3 Billion Bid for London Stock Exchange
NATIONAL BEDDING: Moody's Junks Rating on $210 Mil. Sr. Facility
NATIONAL BENEVOLENT: Weil Gotshal Malpractice Suit Dismissed
NAVIOS MARITIME: Buys Kleimar's Share Capital for $165.6 Million

NEWCOMM WIRELESS: Governmental Units Can File Claims Until May 28
PACIFIC COAST:  Moody's Rates $96 Mil. Class B Senior Notes at B3
PHILLIPS-VAN: Enters Licensing Pact with Timberland Company
PITTSFIELD WEAVING: Ct. Extends Cash Collateral Access to Feb. 17
PORT BARRE: $185 Million Credit Facilities Rated B+ by S&P

PRIMEDIA INC: Board Approves Sale of Enthusiast Media Segment
PSS WORLD: Earns $11.1 Million in Quarter Ended Dec. 29, 2006
RAMP SERIES: S&P's Junk Rating on Series 2004-SL3 Class B-2 Certs.
READER'S DIGEST: S&P Puts 'B' Rating on $1.46 Billion Facilities
REAL ESTATE: Fitch Rates $20 Million Class B12 Notes at B-

REDWOOD CAPITAL: Moody's Rates $250 Million Debentures at Ba2
RENAISSANCE HOME: S&P Cuts Ratings on Class B Certificates to BB
RESIDENTIAL ASSET: Fitch Rates $5.9MM Class B Certificates at BB+
RESOURCE REAL: Fitch Holds B Rating on $28 Million Class K Notes
RITE AID: Fitch Junks Rating on $500 Million Senior Notes due 2015

RITE AID: S&P Puts B+ Rated $300 Mil. Senior Notes on Neg. Watch
RIVERSIDE ENERGY: S&P Holds B Rating, Revises Outlook to Stable
ROCKY MOUNTAIN: S&P Revises Outlook Despite Calpine's Bankruptcy
SAINT VINCENTS: Files Plan of Reorganization in New York
SAINT VINCENTS: Judge Hardin Okays Property Sale to New Prospect

SERTA: Moody's Junks Rating on $210 Million Senior Facility
SPECIALTY UNDERWRITING: Fitch Cuts Class B-2 Certs. Rating to BB
SPECTRUM BRANDS: Posts $18.8MM Net Loss in Quarter Ended Dec. 31
TECH DATA: Appoints Thomas Morgan to Board of Directors
THERMA-WAVE: Posts $2.3 Million Net Loss in Quarter Ended Dec. 31

THERMADYNE IND: Selling South African Portfolios for $18.2 Million
TOWER AUTOMOTIVE: Exclusive Plan-Filing Period Extended to Feb. 28
TRINSIC INC: Wants to Hire Bankruptcy Services as Claims Agent
VALENCE TECHNOLOGY: Sells $1 Million Common Stock to West Coast
VERSO PAPER: S&P Cuts Corporate Credit Rating to B from B+

VESTA INSURANCE: XL Files Adversary Proceeding on Insurance Policy
VESTA INSURANCE: XL Insurance Wants Stay Lifted to Pay Legal Fees
VICORP RESTAURANTS: Posts $6.1 Million Net Loss for 4th Qtr. 2006
VICORP RESTAURANTS: Posts $7.9 Mil. Net Loss for Fiscal Year 2006
VISANT CORP: Moody's Holds Corporate Family Rating at B1

WERNER LADDER: Can File Notices of Removal Until March 7, 2007
WERNER LADDER: To Sell Substantially All Assets for $255,750,000
WERNER LADDER: Court Moves Exclusive Plan Filing Period to Feb. 15
WILLOWBEND NURSERY: Wants to Sell Agricultural Nursery Business
WINIMO REALTY: Auction on Albany Terminal Set for March 30

XERIUM TECH: Weak Performance Prompts Moody's Ratings Downgrade
YUKOS OIL: U.S.-Based Chevron Eyes Bankrupt Assets
ZANETT INC: CEO Guazzoni Buys 550,000 Shares for $1.1 Million

* Upcoming Meetings, Conferences and Seminars

                             *********

ACIH INC: Moody's Affirms Junk Rating on Discount Notes
-------------------------------------------------------
Moody's Investors Service maintained ACIH's corporate family
rating of B2 and discount notes rated Caa1, as well as the B1
rating on Atrium Companies, Inc. senior secured revolver and term
loan B facilities on review for possible downgrade pending the
receipt of bank waivers and amendments and approval of its pending
acquisition of a window manufacturer, as presented to Moody's.

"[W]e plan to affirm the company's ratings and assign a negative
ratings outlook upon the company being granted the appropriate
waivers and amendments as well as approval of its pending
acquisition by its bank group," said Moody's analyst Paul Aran.

ACIH is an intermediate holding company that is structurally below
Atrium Corporation, the ultimate parent company, but resides above
Atrium Companies, Inc., the primary operating company.

Moody's affirmed the company's speculative grade liquidity rating
at SGL-4 to reflect the current tightness under the company's
financial covenants.

Atrium was placed on review October 30, 2006 to reflect concerns
related to its acquisition strategy, covenant compliance, and
business performance.

These ratings for ACIH remain under review for possible downgrade:

   -- Corporate Family Rating, rated B2

   -- Probability of Default Rating, rated B2

   -- $174 million senior discount notes due 2012, rated Caa1,
      LGD6, 90%

Moody's has also maintained these ratings for Atrium Companies,
Inc. under review for possible downgrade:

   -- $378.5 million senior secured term loan B, due 2012, rated
      B1, LGD3, 37%

   -- $50 million senior secured revolving credit facility, due
      2011, rated B1, LGD3, 37%

The Speculative Grade Liquidity assessment for ACIH was affirmed:

   -- Speculative Grade Liquidity Rating, SGL-4

The company's outlook is expected to be changed to negative upon
Moody's conclusion of the ratings review.  The negative outlook
would be in place to reflect the anticipated and continued impact
of the homebuilding and remodeling slowdown on Atrium's sales and
cash flow generation.  The negative outlook would consider the
company's geographic sales mix as Atrium has significant revenue
contribution from markets that are currently experiencing a
slowdown; the markets include Florida, Arizona, California, and
Nevada.  However, a significant portion of its revenues come from
Texas and other markets that are believed to be under less
pressure.

The speculative grade liquidity rating of SGL-4 reflects the
expectation that the company's free cash flow generation will be
slightly positive over the next four quarters.  The SGL rating
also reflects increased tightness under the covenants governing
the senior secured credit facilities due to softening market
conditions.

Atrium has access to a $50 million revolving credit facility that
is used intermittently for working capital purposes.  Moody's
considers the credit facility to be small relative to the
company's overall size.  Atrium also has access to a $60 million
accounts receivable securitization facility with projected
availability of approximately $20 million.  However, rating
triggers under this program may affect the company's ability to
access this facility.

Headquartered in Dallas, Texas, Atrium Companies, Inc. is one of
the largest window manufacturers in the United States.  Revenues
for 2005 were $787 million.


ADELPHIA COMMS: Effective Date of Reorganization Plan is Today
--------------------------------------------------------------
The effective date of its First Modified Fifth Amended Joint
Chapter 11 Plan of Reorganization of Adelphia Communications
Corporation and Certain Affiliated Debtors, dated as of Jan. 3,
2007, as Confirmed, will occur today, Feb. 13, 2007.

The Distribution Record Date for distributions under the Plan to
holders of Notes Claims and Equity Interests will be Feb. 13, 2007
at 4:00 p.m. (Eastern Standard Time).  Jan. 10, 2007 at 4:00 p.m.
(Eastern Standard Time) remains the Distribution Record Date for
holders of all Claims other than Notes Claims and Equity
Interests.  Initial distributions will commence today, Feb. 13,
2007.

Creditor inquiries regarding distributions under the Plan should
be directed to creditor.inquiries@adelphia.com

                      About Adelphia Comms

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

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642).  Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 163; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

As reported in the Troubled Company Reporter on Jan. 9, 2007, the
Honorable Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York has entered an order confirming the
first modified fifth amended joint Chapter 11 plan of
reorganization of Adelphia Communications Corporation and Certain
Affiliated Debtors.


ADELPHIA COMMS: Wants TWC Stock Public Sale Procedures Approved
---------------------------------------------------------------
Adelphia Communications Corp. and its debtor-affiliates anticipate
that their Fifth Amended Plan of Reorganization will enable them
to distribute the Time Warner Cable Inc. Class A Common Stock to
creditors pursuant to Section 1145 of the Bankruptcy Code, and
without the need for a public sale.

To comply with existing contractual obligations under the
Registration Rights Agreement previously approved by the Honorable
Robert E. Gerber of the U.S. Bankruptcy Court for the Southern
District of New York, the ACOM Debtors must pursue a "dual track"
strategy until the commencement of distributions under the Fifth
Amended Plan:

   (a) seek confirmation of the Fifth Amended Plan; and

   (b) pursuant to the Registration Rights Agreement, under
       certain circumstances, sell the TWC Stock pursuant to
       a public sale.

The ACOM Debtors have been taking and must continue
to take certain steps to prepare for the Public Sale of the TWC
Stock as they pursue confirmation of the Plan.  Accordingly, the
ACOM Debtors seek the Court's authority to:

   (a) approve certain procedures relating to their potential
       sale pursuant to a firm fully underwritten public sale of
       no less than 33-1/3% -- inclusive of any shares sold
       pursuant to the overallotment options granted to the
       Underwriters -- of the TWC Stock received by the ACOM
       Debtors and the Escrow Agent in connection with the Sale
       Transaction;

   (b) allow the Debtors to enter into an underwriting agreement
       with certain underwriters, in connection with the Public
       Sale and other agreements as necessary or advisable to
       effectuate the Public Sale; and

   (c) allow the sale of the TWC Stock to be offered in the
       Public Sale to the Underwriters free and clear of
       Interests.

                 Registration Rights Agreements

ACOM had sold substantially all of its assets to Time Warner NY
Cable LLC and Comcast Corporation, and entered into a Registration
Rights Agreement.

Under the Registration Rights Agreement and the Purchase
Agreements, the ACOM Debtors are required, within three months of
the relevant TWC registration statement being declared effective
by the Securities and Exchange Commission, to sell at least 33-
1/3% of the TWC Stock in a single firm commitment underwritten
public offering unless prior to that time, the ACOM Debtors
consummate a plan of reorganization, pursuant to which either:

   (a) at least 75% of the then remaining TWC Stock, other than
       the shares held by the Escrow Agent pursuant to the Escrow
       Agreement, is distributed to the creditors as long as the
       stock is approved for listing on The New York Stock
       Exchange or The Nasdaq National Market within two weeks;
       or

   (b) 90% of the TWC Stock, other than shares held pursuant to
       the Escrow Agreement, is distributed to the creditors.

If the Fifth Amended Plan is timely confirmed and TWC is able to
obtain the requisite approval for listing, the Plan will satisfy
the Plan Requirement.

On Oct. 18, 2006, TWC filed a Registration Statement on Form
S-1 with the SEC.  On Nov. 14, 2006, TWC received initial
comments from the SEC.  The ACOM Debtors expect TWC and the SEC
to resolve those comments promptly, so that TWC will be in a
position in the relative near term to have the Registration
Statement declared effective by the SEC.

                  Underwriter Selection Process

Pursuant to the Registration Rights Agreement, Time Warner and
the ACOM Debtors are required to select three nationally
recognized investment banking firms to serve as the lead book-
running managing underwriters for the Public Sale and, as
determined by TWC, additional Managing Underwriters and
nationally recognized investment banking firms as co-lead
managers.

In September 2006, the Debtors and Time Warner conducted an
extensive selection process in which the parties met and
considered numerous sophisticated, qualified, and nationally
recognized investment banks for the positions of the Managing
Underwriters.  Concurrently with the selection process, the ACOM
Debtors made several presentations to and solicited the input of
representatives of the Official Committee of Unsecured Creditors
regarding the investment banks.  The Creditors Committee
subsequently met with representatives from several investment
banking firms.

In mid-September 2006, Time Warner notified the ACOM Debtors of
its intent to select three investment banking firms to serve as
Managing Underwriters for the Public Sale of the TWC Stock.
After further consultation with the Creditors Committee, the ACOM
Debtors selected two additional investment banking firms to serve
as Managing Underwriters for the Public Sale of the TWC Stock.

The Managing Underwriters are represented by Shearman & Sterling
LLP, which also represents Rembrandt Technologies, L.P., in an
adversary proceeding initiated against certain ACOM entities.

The ACOM Debtors have discussed with Shearman & Sterling the dual
representation.  The firm believes that it has no ethical
barriers to that dual representation and, in any event, has
represented that it has established sufficient ethical walls
between the attorneys representing Rembrandt and those
representing the Managing Underwriters so as to eliminate the
potential risk of information leakage detrimental to these
estates.

At Time Warner's request, the ACOM Debtors have agreed not to
disclose the names of the investment banking firms selected to
serve as Managing Underwriters.  The ACOM Debtors will file a
notice by December 16, 2006, with the Court disclosing the names
of the five investment banking firms selected to act as Managing
Underwriters.

                       Public Sale Process

Pursuant to Section 2.1 of the Registration Rights Agreement,
Time Warner, the ACOM Debtors and the Managing Underwriters will
determine the date on which the initial offering efforts, in
connection with the Public Sale of the TWC Stock, occur.

To ensure the timeliness of the decision-making necessary in
connection with the Public Sale and to ensure that the Creditors
Committee has decision-making authority in connection with the
Public Sale Process, the ACOM Debtors have agreed with the
Committee to establish a panel, comprising representatives of the
ACOM Debtors and of the Committee.  The Public Sale Committee
will determine:

   (a) an initial price range for which the TWC Stock will be
       offered to the public during the road show, in which Time
       Warner and the Underwriters will meet with potential
       investors to market the TWC Stock, and in any Preliminary
       Prospectus and any modifications thereto;

   (b) the offering price of the TWC Stock;

   (c) the timing of the Public Sale, including whether to extend
       the timing of the offering beyond the date the
       Registration Statement is declared effective by the SEC;

   (d) whether to extend the Public Sale by up to 72 hours in
       certain circumstances as provided in the Registration
       Rights Agreement; and

   (e) the number of shares of TWC Stock, if any, in excess of
       the 33-1/3% required to be sold by the Debtors that will
       be included in the Public Sale.

The ACOM Debtors expect that when the road show is nearly
complete, Time Warner will ask the SEC to declare the
Registration Statement effective.  Alternatively, it is possible
that Time Warner will seek to have the Registration Statement
declared effective prior to the commencement of the road show in
order to start the three-month period in which the Debtors must,
subject to certain exceptions, effect the Public Sale.

In no case later than three months after the Registration
Statement is declared effective, the Public Sale Committee will
determine the Offering Price of the TWC Stock, after consultation
with Time Warner, and in accordance with the recommendations of
the Managing Underwriters.  At that time, the ACOM Debtors, the
Underwriters, and Time Warner will execute the Underwriting
Agreement and related agreements.

                      Underwriting Agreement

Prior to the Public Sale, the ACOM Debtors, Time Warner and the
Underwriters will execute the Underwriting Agreement to
memorialize and effectuate the sale of the TWC Stock to the
Underwriters in connection with the Public Sale.

Pursuant to the Underwriting Agreement, among other things, the
ACOM Debtors will sell the stock to the Underwriters for a
purchase price.  The difference between the Purchase Price and
the Offering Price -- the Gross Spread -- expressed as a
percentage of the Offering Price, which is a negotiated
percentage, represents the "fee" earned by the Underwriters for
their services and for accepting the underwriter's risk and
potential liability.

Shelley C. Chapman, Esq., at Willkie Farr & Gallagher LLP, in New
York, relates that the Gross Spread has been heavily negotiated
between the ACOM Debtors and the Underwriters.  The Gross Spread
represents a price for those services and risk that is at market.

Given the experience of the Underwriters and the critical role
they play in effectuating a successful Public Sale, the Debtors
believe the Gross Spread is reasonable.

Additional salient terms of the Underwriting Agreement are:

   (a) the Underwriters can purchase up to an additional 15% of
       the shares of TWC Stock initially being offered in the
       Public Sale at the Purchase Price within 30 days of
       execution of the Underwriting Agreement solely for the
       purpose of covering overallotments made in connection with
       the Public Sale.

   (b) the Shares will be transferred to the Managing
       Underwriters free and clear of all liens, claims,
       encumbrances and interests of any kind or nature.

   (c) Time Warner and the ACOM Debtors agree with the
       Underwriters that they will not, subject to certain
       exceptions, during the period ending no later than 180
       days after the date of the final Prospectus -- the Lock-Up
       Period" -- without the prior written consent as required
       by the Underwriting Agreement, offer, sell, contract to
       sell, pledge, or otherwise distribute or dispose of any of
       the outstanding shares of TWC Class A and or Class B
       Common Stock, other than the TWC Stock sold in the Public
       Sale, or any securities convertible into, or exercisable
       or exchangeable for, shares of the stock; or publicly
       announce an intention to effect any of the transaction.

   (d) The ACOM Debtors agree to indemnify and hold harmless Time
       Warner and each Underwriter against any and all losses,
       claims, liabilities or damages to which they or any of
       them may become subject that arise out of:

         * any untrue statement of a material fact contained in
           the Registration Statement, in any prospectus, or in
           any road show; or

         * the omission to state a material fact required
           to be stated or necessary to make the statements
           not misleading.

       The ACOM Debtors also agree to reimburse each indemnified
       party for any legal or other expenses reasonably incurred
       in connection with investigating or defending any of those
       loss, but only with reference to the Selling Stockholder
       Information.

   (e) The ACOM Debtors agree that, as contemplated by the
       Registration Rights Agreement, they will be responsible
       for the fees, disbursements and expenses of their counsel
       and accountants, except to the extent those accountant's
       expenses are contemplated to be paid by Time Warner
       pursuant to the Purchase Agreements.

               Underwriting Agreement Form Filed

The Debtors have delivered to the Court the form of the
Underwriting Agreement in connection with the public sale of the
Time Warner Cable Inc. Class A Common Stock.

Pursuant to the Underwriting Agreement, among other things, the
ACOM Debtors will sell the TWC Stock to certain underwriters for
a purchase price.

A copy of the Underwriting Agreement form is available for free
at http://researcharchives.com/t/s?19b4

              Debtors File Gross Spread Under Seal

The ACOM Debtors obtained permission from Judge Gerber to file
under seal the Gross Spread and related materials, and be made
available only to:

   (i) counsel to the Official Committee of Unsecured Creditors
       and the Official Committee of Equity Security Holders;

  (ii) the United States Trustee for the Southern District of New
       York;

(iii) counsel to the Underwriters;

  (iv) and other parties as the Court order, or agreed by the
       ACOM Debtors.

Shelley C. Chapman, Esq., at Willkie Farr & Gallagher LLP, in New
York, contends that the fee structure embodied in the Gross
Spread is sensitive business information and must be filed under
seal.

If the fee structure is disclosed prior to the consummation of
the Public Sale, the Underwriters will insist upon a structure
that is less favorable for the ACOM Debtors, Ms. Chapman asserts.

The ACOM Debtors maintain that the Gross Spread is reasonable
considering the characteristics of the Public Sale, the
experience of the Underwriters and the critical role they play in
effectuating a successful transaction.  The Gross Spread
represents a market rate for transactions similar to the Public
Sale.

Ms. Chapman contends that the disclosure of the Gross Spread will
impact the ACOM Debtors' ability to achieve the maximum value for
the TWC Stock to be sold in the Public Sale, thereby resulting in
potentially increased costs to the estates.

Disclosure of the Gross Spread or any of the related materials,
objections and evidence is not necessary for the protection of
the public, the ACOM Debtors' creditors or third parties.

                      About Adelphia Comms

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

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642).  Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 163; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

As reported in the Troubled Company Reporter on Jan. 9, 2007, the
Honorable Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York has entered an order confirming the
first modified fifth amended joint Chapter 11 plan of
reorganization of Adelphia Communications Corporation and Certain
Affiliated Debtors.


ADELPHIA COMMS: Wants to Implement 2007 Employee Incentive Program
------------------------------------------------------------------
Adelphia Communications Corp. and its debtor-affiliates and the
Official Committee of Unsecured Creditors seek authority from the
U.S. Bankruptcy Court for the Southern District of New York to
implement an incentive and retention program for certain key
employees who remain employed by the Debtors after confirmation of
the ACOM Debtors' Modified Fifth Amended Joint Chapter 11 Plan.

Representing the ACOM Debtors, Shelley C. Chapman, Esq., at
Willkie Farr & Gallagher LLP, in New York, relates that the
Covered Employees continue to face uncertainty regarding their
employment.  This uncertainty, occasioned by the appeal and
subsequent stay of the Confirmation Order, likely will cause a
mass exodus of the Covered Employees at a critical juncture, Ms.
Chapman asserts.

In anticipation initially of a December 2006 or, subsequently, an
early January 2007 Effective Date, the majority of the Covered
Employees had been scheduled to leave the ACOM Debtors' employ on
Feb. 28, 2007.

The delay due to the pendency of the appeal and the stay obtained
by a group of bondholders of Senior Notes of Adelphia
Communications Corp. has forced the ACOM Debtors to revise their
staffing plan, Ms. Chapman says.

The need to retain personnel to implement tasks relating to the
operation of the ACOM Debtors' remaining business, closing the
Plan, and the pressing need to commence work on an audit for 2006
have compelled the ACOM Debtors to attempt to retain the
employees notwithstanding the fact that they have been given
their termination notices. Ms Chapman tells the Court.

The ACOM Debtors estimate that the proposed 2007 KERP, including
the incremental payroll obligations resulting from retention of
the Covered Employees for a longer period of time than originally
anticipated, will cost $5,200,000.

Ms. Chapman maintains that the estimated $5,200,000 costs are
directly attributable to the delayed Effective Date caused by the
stay proceedings.  The damage to the ACOM Debtors' estates will
be substantially greater if the Effective Date will not occur,
she adds.

Ms. Chapman asserts that the remaining tasks to be accomplished
cannot be performed by outside contractors, who lack the
historical knowledge of the ACOM Debtors' business and
operations, without significant difficulty and needless cost.
The cost of hiring contractors also far outweighs the incremental
cost to the ACOM Debtors' estates of the proposed 2007 KERP.

No one can predict with certainty when the Effective Date of the
Plan, and thus the transfer of oversight responsibility to a Plan
Administrator, will occur, Ms. Chapman notes.  Without a program
in place to compensate Covered Employees for the uncertainty
associated with their continued employment, the ACOM Debtors and
the Creditors Committee are concerned that significant personnel
will depart in the near term, at great cost to the estates.

                           2007 KERP

Under the terms of the 2007 KERP, the ACOM Debtors seek to
provide incentives to the Covered Employees to remain in the
their employ through the end of May 2007, and in a few cases
through the end of July 2007.

The 2007 KERP is comprised of two components:

   (a) a standard compensation component; and

   (b) a discretionary component for certain key Covered
       Employees.

The 2007 KERP provides for continuing compensation of the Covered
Employees beyond their previously scheduled termination date in
accordance with the Post-Closing Incentive Program or Extended
Employee Post-Closing Incentive Program formulas.

For those Covered Employees working under the Post-Closing
Incentive Program, the extension of their employment will entitle
them to a larger bonus under the program, as the calculation of
such bonus corresponds to the length of an employee's service.

For those Covered Employees working under the Extended Employee
Post-Closing Incentive Program who were originally scheduled to
terminate as of Feb. 28, 2007, the termination date would
have entitled them to an EKERP Bonus of 50% of their Adjusted
Base Salary for the months August 2006 through November 2006, and
75% of their Adjusted Base Salary for the months December 2006
through February 2007.  By extending these Covered Employees'
terms through May 31, 2007, the employees will be entitled to an
additional 75% of Adjusted Base Salary for the months of March
and April, and 100% of Adjusted Base Salary for the month of May.

Covered Employees whose terms are extended from Feb. 28, 2007
through July 31, 2007 will be entitled to an additional 75% of
Adjusted Base Salary for the months of March and April and 100%
of Adjusted Base Salary for the months of May, June and July.

                Discretionary 2007 KERP Awards

The ACOM Debtors believe that the 2007 KERP will provide
compensation to the Covered Employees sufficient to retain the
needed personnel.

Nevertheless, Ms. Chapman says, certain of the Covered Employees
stand out as uniquely critical to the ACOM Debtors' remaining
operations, and a departure of even one of these key Covered
Employees could have a "domino" effect resulting in more
widespread attrition.

Accordingly, the ACOM Debtors and the Creditors Committee seek
the Court's authority to make discretionary awards to up to five
Covered Employees to induce them to remain in the ACOM Debtors'
employ for a longer period of time than originally contemplated.

Discretionary 2007 KERP Awards will be distributed in accordance
with the same procedure for distributing Discretionary EKERP
Awards.  The ACOM Debtors' Chief Executive Officer will consult
with the Creditors Committee prior to making any Discretionary
2007 KERP Awards if the award is more than 50% of the formulaic
EKERP bonus.

As a further layer of oversight, each Discretionary 2007 KERP
Award will be subject to the approval of Quest Turnaround
Advisors, LLC, as the Plan Administrator.

The ACOM Debtors propose to award Discretionary 2007 KERP Awards
totaling $1,350,000.

                      About Adelphia Comms

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

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642).  Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 163; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

As reported in the Troubled Company Reporter on Jan. 9, 2007, the
Honorable Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York confirmed Adelphia Communications
Corp. and its debtor-affiliates' first modified fifth amended
joint Chapter 11 plan of reorganization.


ADVANCED MARKETING: Wants PGW Employee Retention Program Approved
-----------------------------------------------------------------
Advanced Marketing Services Inc. and its debtor-affiliates
previously asked the U.S. Bankruptcy Court for the District of
Delaware for authority to sell Publishers Group West Inc.'s rights
under its distribution agreements with various publishers to
Perseus Books LLC, and Client Distribution Services Inc.

The Debtors now ask the Court for authority to implement a PGW
Employee Retention Program, which provides bonuses to certain PGW
key employees in providing transition services in connection with
the aforementioned Perseus transaction -- the PGW Transition
Services Bonus Plan.

To preserve the Debtors' ability to effect the Perseus
transaction, including the provision of the transition services,
PGW must retain key employees in numerous departments, including
sales and merchandise, logistics and accounting, Mark D. Collins,
Esq., at Richards, Layton & Finger, PA, at Wilmington, Delaware,
relates.

According to Mr. Collins, the Debtors have determined that the
total anticipated cost of the PGW Employee Retention Program is
$750,850.  The PGW Employee Retention Program applies to
approximately 117 employees, but none of the PGW Key Employees
are officers of the Debtors.

Pursuant to the PGW Transition Services Bonus Plan, the PGW Key
Employees are eligible to receive bonuses in the range of $303 to
$45,900, based on:

    (1) a consideration of their compensation in effect upon their
        approval for participation in the PGW Transition Services
        Bonus Plan;

    (2) employment position classification; and

    (3) continued employment with PGW on July 31, 2007.

The total cost of the bonuses payable to PGW Key Employees under
the PGW Employee Retention Program will be paid by Perseus, Mr.
Collins notes.  Hence, the direct cost to the PGW estate that
would otherwise be incurred to retain its key employees to
maintain operations pending a going concern sale will be paid by
the buyer of PGW's assets.  Mr. Collins adds that the
implementation of the PGW Key Employee Retention Program is
contingent on the Court's approval of the Perseus transaction.

Mr. Collins asserts that the Debtors considered a number of
factors in designing the PGW Employee Retention Program in
conjunction with Perseus, including industry standards, PGW's
historic practices, and the nature of its business.  The
potential costs associated with the loss of employees would be
far in excess of the cost of the PGW Employee Retention Program.

The successful consummation of the Perseus transaction, in turn,
relies on retaining employees with the knowledge and skill of
PGW's business to perform the transition services, Mr. Collins
asserts.  PGW's employees, and in particular the PGW Key
Employees, are critical to performing the transition services.

"The loss of key employees would lead to further work force
attrition as employee morale would deteriorate with the
departures and concomitant increased work demands on remaining
employees," Mr. Collins says.

                      About Advanced Marketing

Based in San Diego, California, Advanced Marketing Services, Inc.
-- http://www.advmkt.com/-- provides customized merchandising,
wholesaling, distribution and publishing services, currently
primarily to the book industry.  The company has operations in the
U.S., Mexico, the United Kingdom and Australia and employs
approximately 1,200 people Worldwide.

The company and its two affiliates, Publishers Group Incorporated
and Publishers Group West Incorporated filed for chapter 11
protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos. 06-11480
through 06-11482).  Suzzanne S. Uhland, Esq., Austin K. Barron,
Esq., Alexandra B. Feldman, Esq., O'Melveny & Myers, LLP,
represent the Debtors as Lead Counsel.  Chun I. Jang, Esq., Mark
D. Collins, Esq., and Paul Noble Heath, Esq., at Richards, Layton
& Finger, P.A., represent the Debtors as Local Counsel.  When the
Debtors filed for protection from their creditors, they listed
estimated assets and debts of more than $100 million.  The
Debtors' exclusive period to file a chapter 11 plan expires on
Apr. 28, 2007. (Advanced Marketing Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


ADVANCED MARKETING: NBN Files Bid to Buy PGW Distribution Rights
----------------------------------------------------------------
National Book Network Inc. made a competing and superior bid to
purchase Publishers Group West Inc.'s rights under its
distribution agreements with various publishers, Rich Publishing
LLC disclosed in its objection to the proposed sale to Perseus
Books LLC, and Client Distribution Services Inc.

As reported in the Troubled Company Reporter on Jan. 31, 2007,
Advanced Marketing Services Inc. and its debtor-affiliates asked
the U.S. Bankruptcy Court for the District of Delaware for
authority to sell Publishers Group West's rights under its
distribution agreements with various publishers to Perseus Books
and Client Distribution Services Inc.

The Court set a hearing yesterday, Feb. 12, 2007, to consider the
Debtors' request to sell PGW's rights under its distribution
agreements with various publishers to Perseus Books and CDS.

                            NBN's Offer

NBN offered to pay 85 cents on the dollar for the claims of all
PGW publishers, Rich Publishing said.

The NBN offer was announced, in part, by Richard Freese,
president of PGW, who observed that all PGW publishers remain
"free to enter into an offer with NBN," according to Rich
Publishing.

NBN is a sales, marketing, and distribution company servicing
North American and overseas publishers of commercial fiction and
nonfiction books and audio titles.  Founded in 1986, NBN is a
subsidiary of The Rowman & Littlefield Publishing Group, Inc.,
one of North America's largest academic publishers.  NBN is
headquartered in Lanham, Maryland.

                      Parties Object to Sale

Seven parties filed objections to the proposed sale of PGW's
rights under its distribution agreements to Perseus Books and
CDS:

(1) Wells Fargo

Wells Fargo Foothill, Inc., contends that the proposed buyer
protections are inappropriate under the circumstances since the
proposed sale results in no cash or other monetary compensation
to the Debtors or the estate.  The break-up fee will come out
from the Debtors' pocket.

Wells Fargo further notes that (i) Perseus' administrative claim
must be junior to Wells Fargo's administrative claim since Wells
Fargo was granted a superpriority administrative claim enjoying
priority over all other unsecured obligations, and (ii)
procedures to protect PGW's accounts receivable must be
established.

(2) Carus

Carus Publishing Group wants the order authorizing the sale to
reflect that PGW is authorized to assume its distribution
agreements with those publishers that have entered into publisher
agreements with Perseus and other successful bidder, which
assumption will occur prior to their assignment.  Carus further
asks the Court to hold that no payments made prepetition to
consenting publishers pursuant to assumed agreements can be
recovered under Section 547 of the Bankruptcy Code or otherwise
by PGW.

(3) Creditors Committee

The Official Committee of Unsecured Creditors argues that the
Debtors' request fails to allow adequate time for the
postpetition solicitation of other purchasers and for competitive
bidding.

Although productive negotiations are ongoing among the
purchasers, the Debtors, and the Committee regarding the terms of
the Transaction Documents, the Committee informs the Court that:

    * it objects to the requirement that Advanced Marketing
      Services, Inc., be responsible for the Administrative Amount
      because AMS should not be obligated to incur any expense
      that is the responsibility of PGW;

    * the Transaction Documents must specify that CDS is
      responsible for all costs related to the transition
      involving the PGW Sale under the Transition Services
      Agreement; specify the exact amounts of PGW's and AMS's
      costs for which the Purchasers will be responsible; and set
      forth a dispute resolution process;

    * the Transaction Documents fail to provide that Perseus Books
      guarantee all of the obligations of CDS under the
      agreements; and

    * the proposed Purchaser Protection is inappropriate under
      the circumstances.

The Committee reserves its right to withdraw its objections in
whole, or in part, as issues are resolved.

(4) Elsevier

Elsevier, Inc., as successor-in-interest to CMP Media LLC,
objects to the sale insofar as PGW seeks to assume an executory
contract with CMP and assign that contract to the proposed
purchasers without complying with the assumption, assignment and
cure requirements.  Elsevier also objects to the sale insofar as
it purports to transfer title to books owned by Elsevier, but are
currently held by PGW as a bailee.

(5) Rich Publishing

According to Rich Publishing LLC, it objects to the sale insofar
as there is a superior offer outstanding for the same PGW assets.
Rich Publishing wants the Court to postpone for at least two
weeks, the hearing on the request until the NBN offer process has
developed and other competing bids, if any, are presented.

(6) LearningExpress

LearningExpress, LLC, objects to the PGW Sale to the extent that
it seeks to assume and assign its Distribution Agreement with PGW
without providing for (i) a cure of all pre- and post-Petition
Date defaults of PGW under the Agreement, and (ii) adequate
assurance of future performance by a proposed purchaser,
including with respect to its Loan Agreement with PGW.

LearningExpress notes that it is willing to consider alternate
proposals, including from PGW, Perseus Books, or possibly other
potential purchasers.

(7) NAB

Society for the Study of Native Arts and Sciences, doing business
as North Atlantic Books, asserts that the sale unfairly
prejudices publishers, like itself, whose contracts will not be
assigned to the proposed purchasers.

Any benefits seems to inure only to creditor-publishers whose
agreements are being assigned to the Purchasers at the expense of
those publishers whose agreements will be rejected, NAB says.

                      About Advanced Marketing

Based in San Diego, California, Advanced Marketing Services, Inc.
-- http://www.advmkt.com/-- provides customized merchandising,
wholesaling, distribution and publishing services, currently
primarily to the book industry.  The company has operations in the
U.S., Mexico, the United Kingdom and Australia and employs
approximately 1,200 people Worldwide.

The company and its two affiliates, Publishers Group Incorporated
and Publishers Group West Incorporated filed for chapter 11
protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos. 06-11480
through 06-11482).  Suzzanne S. Uhland, Esq., Austin K. Barron,
Esq., Alexandra B. Feldman, Esq., O'Melveny & Myers, LLP,
represent the Debtors as Lead Counsel.  Chun I. Jang, Esq., Mark
D. Collins, Esq., and Paul Noble Heath, Esq., at Richards, Layton
& Finger, P.A., represent the Debtors as Local Counsel.  When the
Debtors filed for protection from their creditors, they listed
estimated assets and debts of more than $100 million.  The
Debtors' exclusive period to file a chapter 11 plan expires on
Apr. 28, 2007. (Advanced Marketing Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


ADVANTA CORP: Earns $84.2 Million In Year Ended December 31
-----------------------------------------------------------
Advanta Corp. reported fourth quarter net income of $18.2 million
and net income from continuing operations of $84.2 million for the
year ended Dec. 31, 2006.  Net income for the year ended Dec. 31,
2006, was $85 million.

"Our 2006 full year Business Cards earnings increased by over 50%,
and our managed receivables grew by almost 39%; we added 56% more
new customers, and our managed net credit loss rate dropped by 230
basis points to 3.41%.  We had a great year!  Most importantly we
continued to strengthen and build on the foundation for the
burgeoning results we expect to see going forward," said Dennis
Alter, the company's chairman and chief executive officer.

Ending managed receivables grew to $5.2 billion at Dec. 31, 2006,
with full year new customers totaling approximately 371,000.
Ending owned receivables grew 29% during the year to $1.1 billion,
and the full year net credit loss rate on owned receivables
decreased 218 basis points to 3.19%.  2006 customer transaction
volume totaled $12.3 billion, a 26% increase over 2005.

                          About Advanta

Advanta Corp. (NASDAQ: ADVNB, ADVNA) -- http://www.advanta.com/--  
is the only credit card issuer (through Advanta Bank Corp.)
exclusively focused on the small business credit card market.

                          *     *     *

As reported in the Troubled Company Reported on Dec. 13, 2006,
Fitch Ratings affirmed the long-term Issuer Default Rating of
Advanta Corp. and Advanta Bank Corp. at 'BB-".  The Rating Outlook
is revised to Positive from Stable.


ALCATEL-LUCENT: Performed Well Despite Weak Results Says Fitch
--------------------------------------------------------------
Fitch Ratings reported that Alcatel-Lucent has managed
expectations well and apparently received good support from the
capital markets, despite what was a relatively weak but
well-flagged set of full-year financial results.

The results support Fitch's downgrade of Alcatel to 'BB' from
'BBB-' on Dec. 8, 2006 upon completion of the Lucent merger.

"It is interesting that a well-trailed profit warning in January
and a step-up in restructuring initiatives announced [Fri]day,
combined with a relatively weak set of results, have resulted in a
positive reaction from the equity markets for Alcatel-Lucent this
morning," says Stuart Reid, a Director in Fitch's European TMT
team.

"While the company provided somewhat reassuring guidance for 2007,
Fitch believes considerable work remains before the company might
justify a move back into the investment-grade world".

Alcatel-Lucent results included a fall in pro-forma sales by 1.7%
to EUR18.2 billion, at a time when equipment vendors generally
have been reporting healthy levels of growth.  Stripping out the
impact of restructuring, impairments and share-based compensation,
operating income fell to EUR1,025 million reflecting a pro-forma
margin of 5.6%.  Coupled with relatively weak cash flows and a
more leveraged balance sheet, the agency believes the current
rating of 'BB' to be fully justified.

While it is too early to conclude too much from Alcatel-Lucent's
figures, the weakness in the company's North American mobile
revenues in 2006 - the key strategic benefit contributed by Lucent
- is a concern.  Although Ericsson, which reported last week, also
suffered an erosion in sales from the region in 2006, its strong
overall revenue and earnings growth confirm the benefits of the
geographic diversity that that company enjoys.

In terms of cash flow performance, analysis is obscured by the
fact that Alcatel-Lucent's numbers only benefit from one month's
consolidation of the merged entity.  They nonetheless confirm
Fitch's reservations at the time of the downgrade in December 2006
that cash flow would be weakened and that the company's
capitalization would suffer as a result of the merger.  On a
consolidated basis Alcatel-Lucent reported negative free cash flow
of around EUR500 million for the year.

While credit default spreads generally have benefited from
technical conditions in recent months, Fitch views the tightening
in Alcatel-Lucent's credit spreads in recent months somewhat
difficult to rationalize.

Fitch would want to see an improvement in operating margins and
free cash flow before any change in the Outlook might be
considered.  While the company has articulated a clear road map to
improved profitability, including the escalation in headcount cuts
from 9,000 to 12,500, execution risk remains.  Cash costs related
to the restructuring will weigh on cash flow and liquidity,
although M&A risk is considered relatively low given the
challenges at hand.


AMERICAN TOWER: Fitch Lifts Senior Notes' Rating to BB+ from BB-
----------------------------------------------------------------
Fitch Ratings has upgraded the ratings on American Tower Corp. and
its subsidiaries as:

American Tower Corp

   -- Issuer Default rating to 'BB+' from 'BB-';
   -- Senior Unsecured notes to 'BB+' from 'BB-'.

American Towers Inc.

   -- IDR to 'BB' from 'BB-'.

SpectraSite Communications Inc.

   -- IDR to 'BB' from 'BB-'.

ATI's senior subordinated debt and senior secured credit facility
are affirmed at 'BB+' and 'BBB-' respectively.  SpectraSite's
senior secured credit facility is affirmed at 'BBB-'.

The Rating Outlook is Stable.

American Tower's ratings upgrade reflect the strong operating
performance which exceeded Fitch's financial projections as well
as the increased scale that has resulted in improved free cash
flow.  AMT's operating characteristics remain favorable, resulting
in some of the highest profitability measures for all of corporate
credits and reflective of the lower business risk, which results
in a predictable and growing cash flow stream generated primarily
from investment grade national wireless operators.

Fitch believes these characteristics more than offset AMT's
moderate financial policy with its sizable share repurchase
program and relatively high financial leverage for its rating
category.  AMT should continue to meaningfully improve its
operating metrics due to scale benefits and the expectations for
continued wireless industry demand driven by footprint expansion,
improved coverage, minute growth and increasing demand for
wireless data services as operators focus infrastructure upgrades
on high-speed wireless data.

During the fourth quarter of 2006, AMT completed financial
restatements related to its past stock option practices and
announced a remediation plan to address the material weaknesses in
its internal control over financial reporting.

Fitch believes AMT has made progress at resolving the internal
control issues and has reasonable plans to address these
weaknesses that should be resolved over the coming quarters.

American Tower's liquidity position is solid when considering its
free cash flow, cash on hand, undrawn revolver capacity and share
repurchase program.  American Tower's cash balance at the end of
the third quarter 2006 was $207 million.

The ATI credit facility consists of a $300 million revolving
credit facility, a $750 million term loan A and a $250 million
delay draw term loan.  ATI has fully drawn the term loan A and the
delay draw term loan and has the majority of its revolving
facility available.

The SCI credit facility consists of a $250 million revolving
credit facility, a $700 million Term Loan A and a $200 million
delay draw term loan.  SCI has fully drawn the $700 million term
loan A and drawn $25 million of the delayed draw term loan.  The
remaining $175 million undrawn portion of the delayed draw term
loan component was canceled during the fourth quarter of 2007.

As of Sept. 30, 2006, the majority of SpectraSite's $250 million
revolving credit facility was undrawn.  Each of the credit
facilities has a term of five years, maturing in full on Oct. 27,
2010.  ATI and SCI have a total borrowers leverage ratio and
interest coverage covenant that each subsidiary currently has
considerable cushion.

AMT reported a cash tender offer for its 5% convertible notes due
2010 that note holders could have put to the company in February.
As of Jan. 16, 2007, approximately $252 million of the notes were
outstanding.  AMT will use cash and borrowings under its ATI
credit facility to finance the repurchases of these notes.  AMT
has indicated the company will also likely raise additional
capital in 2007, which may include a securitization of a portion
of its tower assets as well as new or incremental credit
facilities to maintain financial flexibility.  The credit
facilities at ATI and SCI have incremental capacity of
$500 million and $250 million respectively.

Fitch views a potential securitization as likely having a modest
positive impact overall on the ratings depending on the
transaction's final structure.  Over the rating horizon, Fitch
also expects AMT to refinance the majority of its debt and
simplify its capital structure to remove the current restrictions
under its debt indentures.

With the continued sustainability of low capital investment and
strong operating performance, Fitch expects American Tower to
meaningfully increase free cash flow over the next several years.
For 2006, expectations are for consolidated free cash flow to
exceed $475 million.  Since American Tower is well within its net
consolidated leverage target range of 4x-6x, Fitch expects the
majority of excess cash flow and cash on hand will be used to
repurchase shares.  Prior to the suspension of the program in
2006, the Company had repurchased a total of 11.8 million shares
of its Class A common stock for approximately $358 million.  The
company expects to complete the remaining $392 million under the
program by the end of February 2007, at which time, Fitch expects
AMT to initiate a new program of at least comparable size.  Over
the rating horizon, Fitch has expectations for high single digit
to low double digit EBITDA growth and stable leverage for AMT,
with adjusted debt to EBITDAR in the upper 4x range.  However, it
is likely that debt will likely increase moderately over the next
couple of years.


AMERIQUEST MORTGAGE: Moody's Places B1 Rated Certs. on Review
-------------------------------------------------------------
Moody's Investors Service has placed on review for possible
downgrade nine certificates from six deals originated in 2002,
2003 and 2004 by Ameriquest Mortgage Securities Inc.  The
transactions are backed by adjustable- and fixed-rate subprime
mortgage loans.   The Quest Trust 2004-X1 transaction is backed by
"scratch and dent" seasoned and reperforming subprime mortgage
loans.

The reviews are based on the analysis of the current credit
enhancement levels provided by excess spread,
overcollateralization, subordinate classes, and in some cases
mortgage insurance relative to the expected loss.

These are the rating actions:

Review for possible downgrade:

   * Ameriquest Mortgage Securities Inc

      -- Series 2002-C, Class M2, Current Rating B1, under review
         for possible downgrade

      -- Series 2003-2, Class M3, Current Rating Baa3, under
         review for possible downgrade

      -- Series 2003-2, Class M4, Current Rating Ba3, under review
         for possible downgrade

      -- Series 2003-6, Class M6, Current Rating Baa3, under
         review for possible downgrade

      -- Series 2003-13, Class M6, Current Rating Baa3, under
         review for possible downgrade

      -- Series 2004-R2, Class M9, Current Rating Baa3, under
         review for possible downgrade,

      -- Quest Trust 2004-X1, Class M2, Current Rating Baa1, under
         review for possible downgrade

      -- Quest Trust 2004-X1, Class M3, Current Rating Baa2, under
         review for possible downgrade

      -- Quest Trust 2004-X1, Class M4, Current Rating Baa3, under
         review for possible downgrade


AMERISOURCEBERGEN: Earns $122.2 Million in Quarter Ended Dec. 31
----------------------------------------------------------------
AmerisourceBergen Corp. reported $122.2 million of net income for
the first quarter of fiscal 2007, compared with $97.3 million of
net income for the same period last year.

Operating revenue was $15.7 billion in the first quarter of fiscal
2007 compared to $13.5 billion for the same period last year, a
16 percent increase.  Bulk deliveries in the quarter decreased
8 percent to $1 billion from $1.1 billion in last fiscal year's
first quarter.

"The December quarter's excellent performance exceeded our
expectations and provides strong momentum for the remainder of
fiscal 2007," said R. David Yost, AmerisourceBergen's Chief
Executive Officer.

"Operating revenue was a record $15.7 billion, and our outstanding
earnings per share results were driven by strong performance in
our traditional distribution business as well as the continued
strength of our specialty distribution business.

"We enhanced shareholder value by repurchasing a significant
amount of our stock and doubling our dividend.  Our balance sheet
remains strong, and we continue to have excellent financial
flexibility."

Consolidated operating income in the quarter increased 25 percent
to $208.9 million, primarily due to an improved gross margin and
productivity gains in the Pharmaceutical Distribution segment.

"In the first quarter of fiscal 2007, outstanding operating
results were driven by stronger than expected performance in our
distribution businesses supported by our expanding service
offerings," said Kurt J. Hilzinger, AmerisourceBergen's President
and Chief Operating Officer."

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at: http://researcharchives.com/t/s?19a9

                      About AmerisourceBergen

AmerisourceBergen (NYSE:ABC) -- http://www.amerisourcebergen.com/
-- is one of the world's largest pharmaceutical services companies
serving the United States, Canada and selected global markets.
AmerisourceBergen's service solutions range from pharmacy
automation and pharmaceutical packaging to pharmacy services for
skilled nursing and assisted living facilities, reimbursement and
pharmaceutical consulting services, and physician education.
AmerisourceBergen is headquartered in Valley Forge, Pennsylvania,
and employs more than 13,000 people.

                           *     *     *

As reported in the Troubled Company Reporter on Nov. 7, 2006,
Moody's Investors Service affirmed AmerisourceBergen Corp.'s Ba1
Corporate Family Rating.


ANDREW CORP: Charles Nicholas Retires as Chairman of the Board
--------------------------------------------------------------
Andrew Corp. reported that Charles R. Nicholas has retired as
chairman of the company's board of directors.

Mr. Nicholas joined the company as treasurer in 1980 and was named
vice president of finance in 1982, chief financial officer in
1986, and executive vice president of administration and finance
and chief financial officer in 1995.

He served as a director and vice chairman of the board from 2000
until 2004, when he became chairman of the board.

Headquartered in Westchester, Illinois, Andrew Corp.
(NASDAQ:ANDW) -- http://www.andrew.com/-- designs, manufactures
and delivers equipment and solutions for the global
communications infrastructure market.  The company serves
operators and original equipment manufacturers from facilities
in 35 countries including, among others, these Latin American
countries: Argentina, Bahamas, Belize, Barbados, Bermuda and
Brazil.  Andrew is an S&P 500 company Founded in 1937.

                        *     *     *

As reported the Trouble Company Reporter on Dec. 28, 2006,
Standard & Poor's Ratings Services revised its CreditWatch
implications on Andrew Corp. to positive from negative.  The 'BB'
corporate credit and 'B+' subordinated debt ratings were placed
on CreditWatch with negative implications on Aug. 10, 2006.


ARAMARK CORP: Completes Merger with Private Investment Group
------------------------------------------------------------
ARAMARK Corp. disclosed the completion of the acquisition of
ARAMARK by an investor group led by Joseph Neubauer, chairman and
chief executive officer of ARAMARK, and investment funds managed
by GS Capital Partners, CCMP Capital Advisors and J.P. Morgan
Partners, Thomas H. Lee Partners and Warburg Pincus LLC.

"We are pleased to complete this transaction," said Neubauer, who
will remain Chairman and Chief Executive Officer of ARAMARK.  "I
am particularly grateful for the support we have received from our
people who have worked hard to deliver outstanding performance
over many years, and our senior managers who will further dedicate
themselves by making a significant investment in the company.

"This merger opens a new and exciting chapter in ARAMARK's
history.  The new structure will enable us to fully unleash the
company's potential.  Today, we are positioned to drive greater
innovation, pursue strategic opportunities, and build
sophisticated, long-term solutions that deliver the most value for
our clients and customers around the world.

"As we invest in new strategies that will define the future of our
industry, we will continue to build on our heritage of delivering
value to our employees, our partners, our clients and our
customers.  We remain dedicated to providing outstanding
experiences, environments and outcomes each and every day for our
clients around the world."

On Aug. 8, 2006, ARAMARK said it had signed a definitive merger
agreement under which the private investor group would acquire
ARAMARK in a transaction valued at approximately $8.3 billion,
including the assumption or repayment of approximately $2 billion
of debt.

On Dec. 20, 2006, ARAMARK held a special meeting of its
stockholders, at which 86% of the outstanding votes and 97% of the
votes actually cast voted in favor of the adoption of the merger
agreement.

Under the terms of the agreement, ARAMARK shareholders are
entitled to receive $33.80 in cash for each share of ARAMARK
common stock held.

                     About GS Capital Partners

Founded in 1869, Goldman Sachs is one of the oldest and largest
investment banking firms.  Goldman Sachs is also a global leader
in private corporate equity and mezzanine investing.  Established
in 1992, the GS Capital Partners Funds are part of the firm's
Principal Investment Area in the Merchant Banking Division.  With
$8.5 billion in committed capital, GS Capital Partners V is the
current primary investment vehicle for Goldman Sachs to make
privately negotiated equity investments.

                         About CCMP Capital

CCMP Capital Advisors LLC is a leading private equity firm formed
in August 2006 by the former buyout/growth equity investment team
of JPMorgan Partners, a private equity division of JPMorgan Chase.
CCMP Capital is a registered investment adviser with the
Securities and Exchange Commission.

                     About J.P. Morgan Partners

J.P. Morgan Partners LLC is a private equity division of JPMorgan
Chase & Co., one of the largest financial institutions in the
United States.  JPMP has invested over $15 billion worldwide in
consumer, media, energy, industrial, financial services,
healthcare and technology companies since its inception in 1984.

                    About Thomas H. Lee Partners

Thomas H. Lee Partners, L.P. is one of the oldest and most
successful private equity investment firms in the United States.
Since its founding in 1974, THL Partners has invested
approximately $12 billion of equity capital in more than 100
businesses with an aggregate purchase price of more than $90
billion, completed over 200 add-on acquisitions for portfolio
companies, and generated superior returns for its investors and
partners.

                      About Warburg Pincus LLC

Warburg Pincus has been a leading private equity investor since
1971. The firm currently has approximately $16 billion of assets
under management with an additional $4 billion available for
investment in a range of sectors including consumer and retail,
industrial, business services, healthcare, financial services,
energy, real estate and technology, media and telecommunications.

                        About Aramark Corp.

Headquartered in Philadelphia, Pennsylvania, Aramark Corporation
(NYSE: RMK) -- http://www.aramark.com/-- is a professional
services organization, providing food services, facilities
management, hospitality services, and uniforms and career apparel
to health care institutions, universities and school districts,
stadiums and arenas, businesses, prisons, senior living
facilities, parks and resorts, correctional institutions,
conference centers, convention centers, and public safety
professionals around the world. Aramark has approximately 240,000
employees serving clients in 18 countries.


ARAMARK CORP: Fitch Rates $1.78 Bil. Senior Unsecured Notes at B-
-----------------------------------------------------------------
Fitch has downgraded the Issuer Default Rating for both ARAMARK
Corporation and its wholly owned subsidiary, ARAMARK Services,
Inc. to 'B' from 'BB-' and has rated the new financing of ARAMARK
Corporation:

   -- $600 million revolving senior secured credit facility due
      2013 'BB-/RR2';

   -- $4.15 billion senior secured term loans due 2014 'BB-/RR2';

   -- $250 million senior secured synthetic letter of credit
      facility due 2013 'BB-/RR2'; and

   -- $1.78 billion senior unsecured notes due 2015 'B-/RR5'.

In addition, the rating for the $250 million senior unsecured
notes due 2012 was lowered to 'CCC+/RR6' from 'BB-'.  The ratings
are removed from Rating Watch Negative.

The Rating Outlook is Stable.

The action follows ARAMARK's recent disclosure that its leveraged
buyout had been completed.  The action finalizes Fitch's review of
the rating following the company's Aug. 8, 2006 report that the
company's board of directors had agreed to accept a management
buyout offer from a group of investors led by chairman and CEO,
Joseph Neubauer.  The merger, valued at approximately
$8.6 billion, was financed through approximately $2 billion in
equity commitments with the remainder consisting of various debt
instruments noted above.

Fitch expects to withdraw its 'BB-' unsecured bank facility rating
and withdraw its 'BB-' senior unsecured rating for ARAMARK's
existing notes due 2007 and 2008 with the successful completion of
debt tender offers planned for late February.

The ratings reflect ARAMARK's substantially higher leverage ratio
and debt service requirements following the completion of its LBO
and Fitch's expectations for significantly reduced free cash flow.
Pro forma Sept. 29, 2006 total adjusted leverage is expected to be
approximately 7.2x with interest coverage at approximately 1.9x.
Fitch expects credit protection measures to remain near pro forma
levels through the intermediate term.  The ratings also
incorporate potential margin pressure from competitive pricing and
higher operating costs.

The ratings and outlook reflect ARAMARK's leading positions in its
core services, brand recognition, a well diversified customer
portfolio, and high customer retention rates.

In addition, ARAMARK's operating performance has been relatively
stable through various market conditions, including the company's
exposure to unforeseen events over the last couple of years.

The Stable Outlook is also supported by the company's adequate
liquidity position pro forma the proposed transaction, which
includes $103 million of pro forma cash and approximately
$450 million available under its revolving credit facility.  The
company also has a $250 million accounts receivable securitization
program.  Fitch believes that ARAMARK will have limited ability to
improve its credit protection measures in the next few years.
However the company's stable organic revenue growth and solid
market positions should limit any significant deterioration of
credit measures.

According to company filings, the 2012 notes are only guaranteed
by ARAMARK's holding company and will not be guaranteed by
ARAMARK's operating subsidiaries, thereby resulting in structural
subordination of these notes in relation to all of the new debt
issuances which will be fully and unconditionally guaranteed by
substantially all of the company's domestic material operating
subsidiaries.  The indenture for the 2012 bonds generally provides
no protection from a change in control event and does not limit
the company's ability to incur additional indebtedness.

The recovery ratings and notching reflect Fitch recovery
expectations under a distressed scenario.  ARAMARK's recovery
ratings reflect Fitch's expectation that the enterprise value of
the company, and hence, recovery rates for its creditors, will be
maximized in a restructuring scenario, rather than a liquidation.
The 'RR2' recovery rating for the company's credit facilities
reflects Fitch belief that 71%-90% recovery is reasonable given
its priority position.  The recovery rating of 'RR5' for the
$1.78 billion of senior unsecured notes due 2015 reflects that
11%-30% recovery is reasonable and 'RR6' for the $250 million 5%
senior unsecured notes due 2012 reflects Fitch's estimate that
negligible recovery would be achievable due to their position in
the capital structure.

Fitch's Recovery Ratings are a relative indicator of creditor
recovery prospects on a given obligation within an issuers'
capital structure in the event of a default.


ASARCO LLC: AR Sacaton, et al. Tap Baker Botts as Bankr. Counsel
----------------------------------------------------------------
In December 2006, three of ASARCO LLC's subsidiaries, AR Sacaton,
LLC, ASARCO Exploration Company, Inc., and Southern Peru Holdings
LLC, filed petitions under Chapter 11.

Accordingly, AR Sacaton, ASARCO Exploration and Southern Peru seek
authority from the U.S. Bankruptcy Court for the Southern District
of Texas to employ Baker Botts, L.L.P., as their bankruptcy
counsel, nunc pro tunc to Dec. 12, 2006.

As the Subsidiary Debtors' counsel, Baker Botts, among other
things, will:

   -- advise the Subsidiary Debtors with respect to their rights
      and obligations as debtors and other areas of bankruptcy
      law;

   -- assist the Subsidiary Debtors in exploring restructuring
      alternatives, and developing and implementing a
      reorganization strategy;

   -- develop, negotiate and promulgate a Chapter 11 plan of
      reorganization for the Subsidiary Debtors and prepare a
      disclosure statement;

   -- represent the Subsidiary Debtors at all hearings and
      proceedings; and

   -- render general, non-bankruptcy legal services as the
      Subsidiary Debtors may seek from time to time, including,
      without limitation, environmental, corporate, real estate,
      litigation, tax and other matters.

The Subsidiary Debtors have few assets and current operations.
Thus, ASARCO LLC will pay for Baker Botts' services, Douglas E.
McAllister, the Subsidiary Debtors' president, says.  For this
same reason, Baker Botts will not keep separate time entries for
the Subsidiary Debtors.

Baker Botts will be paid according to these hourly rates:

      Professional             Hourly Rate
      ------------             -----------
      Partners                 $400 - $725
      Associates               $215 - $395
      Paralegals               $120 - $200
      Paralegal Clerks          $50 - $105

Baker Botts will also be reimbursed for any necessary and
reasonable out-of-pocket expenses.

Jack L. Kinzie, Esq., at Baker Botts LLP, in Dallas, Texas,
assures the Court that his firm does not represent any interest
adverse to the Subsidiary Debtors, and is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.

                        About ASARCO LLC

Based 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's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).

(ASARCO Bankruptcy News, Issue No. 38; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)

The Honorable Richard S. Schmidt of the U.S. Bankruptcy Court for
the Southern District of Texas in Corpus Christi extended the
Debtors' exclusive period to file a plan of reorganization until
April 6, 2007, and their exclusive period to solicit acceptances
of that plan until June 6, 2007.


ASARCO LLC: Committee Taps Bates White as Asbestos Consultant
-------------------------------------------------------------
The Official Committee of Unsecured Creditors for ASARCO LLC
seeks permission from the U.S. Bankruptcy Court for the Southern
District of Texas to retain Bates White LLC as its consultant on
asbestos and silica-related matters, nunc pro tunc to Jan. 25,
2007.

As the Committee's consultant, Bates White will:

   (a) estimate the number and value of present and future
       asbestos and silica personal injury claims;

   (b) assist the Committee in negotiations with various parties;

   (c) render expert testimony as required by the Committee;

   (d) assist the Committee in preparing expert testimony or
       reports and in the evaluation of reports and testimony by
       other experts and consultants; and

   (e) provide other advisory services as may be requested by the
       Committee from time to time.

Bates White will be paid according to its hourly rates:

      Professional                        Hourly Rates
      ------------                        ------------
      Senior Partner                          $750
      Partner                                 $525
      Principal                               $425
      Manager                                 $350
      Senior Consultant                       $325
      Consultant II                           $275
      Consultant I                            $250
      Programmers                             $250
      Project Coordinator                     $250
      Project Assistant                       $190
      Interns                                 $125

Bates White will also be reimbursed for any reasonable and
necessary out-of-pocket expenses.

Charles Bates, president and senior partner of Bates White LLC,
assures the Court that his firm does not represent any interest
adverse to the Committee, the Debtors and their estates, and is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.

                        About ASARCO LLC

Based 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's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).

(ASARCO Bankruptcy News, Issue No. 38; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)

The Honorable Richard S. Schmidt of the U.S. Bankruptcy Court for
the Southern District of Texas in Corpus Christi had extended the
Debtors' exclusive period to file a plan of reorganization until
April 6, 2007, and their exclusive period to solicit acceptances
of that plan until June 6, 2007.


AUDIO VISUAL: $60 Mil. Senior Secured Facility Rated B3 by Moody's
------------------------------------------------------------------
Moody's Investors Service assigned ratings to Audio Visual
Services Group Inc. in connection with the pending leveraged
buyout of its parent holding company, Audio Visual Services
Corporation.

Moody's assigned a B1 Corporate Family rating, a Ba3 to the
$255 million senior secured first lien credit facility and a B3 to
the $60 million senior secured second lien facility.

The ratings outlook is stable.

On Feb. 7, 2007, Kelso & Company entered into a definitive
agreement to acquire AVSC in a leveraged buyout for a total
enterprise value of approximately $413.4 million, including fees
and expenses.  The transaction is expected to be financed with a
$225 million senior secured first lien term loan, a $60 million
senior secured second lien term loan and an equity contribution of
$128.4 million.  A new $30 million senior secured first lien
revolver will be undrawn at close.  The borrower under the new
first and second lien credit facilities will be Audio Visual
Services Group, Inc., an indirect wholly- owned subsidiary of
AVSC.

Moody's expects to withdraw the ratings on the existing secured
credit facility of AVSC upon the closing of the transaction since
such debt is expected to be repaid with the proceeds from the new
financing package.

Despite a substantial increase in leverage resulting from the
acquisition by Kelso, the company's pro forma credit metrics
position the company solidly in the B1 rating category.  The
ratings benefit from long standing relationships and long term
contracts with major hotel chain customers and good growth
prospects in the intermediate term.  The key constraints on the
ratings include revenue concentration with top hotel chain
customers, significant capital expenditure requirements and
dependence on business travel, which is subject to variability
based on the strength of the economy and other factors.

Moody's assigned these ratings to Audio Visual Services Group,
Inc.:

   -- $30 million first lien revolving credit facility due 2013,
      Ba3, LGD3, 37%

   -- $225 million first lien term loan facility due 2014, Ba3,
      LGD3, 37%

   -- $60 million second lien term loan facility due 2014, B3,
      LGD5, 88%

   -- Corporate family rating, B1

   -- Probability of default rating, B1

These ratings are subject to Moody's review of final
documentation.

Moody's affirmed these ratings of Audio Visual Services
Corporation:

   -- $20 million senior secured revolving credit facility due
      2010, Ba3, LGD2, 28%

   -- $73 million senior secured term loan facility due 2011, Ba3,
      LGD2, 28%

   -- Corporate family rating, B1

   -- Probability of default rating, B2

The stable ratings outlook anticipates solid revenue and EBITDA
growth in 2007 as the company benefits from strong demand for
audiovisual services at existing hotels and continues to add new
hotels in both North America and Europe.

AVSC is the leading provider of audiovisual and event technology
support to hotels, event production companies, trade associations,
convention centers and corporations in North America and Europe.
AVSC reported revenues of $529 million for the twelve month period
ended Sept. 30, 2006.


AVAYA INC: Earns $71 Million in Fiscal Quarter Ended December 31
----------------------------------------------------------------
Avaya Inc. reported net income of $71 million for the first
quarter of ended Dec. 31, 2006, compared with net income of
$71 million for the same period in fiscal 2006.

Avaya's first fiscal quarter 2007 revenues increased 2.5 percent
to $1.28 billion compared to $1.25 billion in the same period last
year.  Avaya shipped more than one million IP lines for the third
consecutive quarter.  Avaya noted that during the first quarter of
fiscal 2006 it experienced delays and disruption in the delivery
of its products to customers due to changes made in its
warehousing and distribution operations and estimates the impact
on revenue in the quarter was approximately $20 million.

"During the first quarter, we invested in our business to extend
our technology leadership, effectively managed costs and expenses,
attracted new talent to our senior management team and delivered
solid bottom line results," said Lou D'Ambrosio, Avaya's president
and chief executive officer.  "We will continue to be relentlessly
focused on our three priorities: strategy, execution and culture."

The company reported operating income for the first fiscal quarter
of 2007 of $90 million.  Operating income for the first fiscal
quarter of 2006 was $107 million.

Avaya ended the quarter with cash of $895 million, relatively flat
with the fourth quarter of fiscal 2006.  The provision for income
taxes in the quarter benefited from discrete tax benefits,
including a retroactive extension of the U.S. federal research and
development tax credit.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19ba

                          About Avaya Inc.

Headquartered in Basking Ridge, New Jersey, Avaya, Inc.
(NYSE:AV) -- http://www.avaya.com/-- designs, builds and
manages communications networks for more than one million
businesses worldwide, including more than 90% of the FORTUNE
500(R).  Avaya is a world leader in secure and reliable Internet
Protocol telephony systems and communications software
applications and services.

                          *     *     *

In January 2005, Moody's Investors Service upgraded the senior
implied rating of Avaya Inc. to Ba3 from B1.  Moody's said the
ratings outlook is positive.


ACXIOM CORP: Earns $24.9 Mil. in 3rd Fiscal Quarter Ended Dec. 31
-----------------------------------------------------------------
Acxiom Corp. reported $24.9 million net income on $352.8 million
of revenues for the third fiscal quarter ended Dec. 31, 2006,
compared with $27.3 million of net income on $347.4 million of
revenues for the same period in 2005.

"Our earnings continue to improve on a sequential basis but are
not in line with our expectations due to slower than expected
revenue growth," Company Leader Charles D. Morgan said.  "We
continue to execute our company-wide initiatives to create more
value for our clients and drive more rapid revenue growth.  We
expect to see more from those efforts over the next several
quarters."

Income from operations was $51.3 million for the quarter ended
Dec. 31,2006, compared to $52.7 million for the same period last
year.

Interest expense increased to $14.9 million from $8.6 million in
the same quarter a year ago.  The increase reflects the
$600 million term loan completed in September 2006.  Proceeds from
the term loan were used to retire debt and buy back approximately
11 million shares of Acxiom stock.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19a8

                          About Acxiom

Based in Little Rock, Arkansas, Acxiom Corporation (Nasdaq: ACXM)
-- http://www.acxiom.com/-- integrates data, services and
technology to create and deliver customer and information
management solutions for many of the largest, most respected
companies in the world.  The core components of Acxiom's solutions
are Customer Data Integration technology, data, database services,
IT outsourcing, consulting and analytics, and privacy leadership.
Founded in 1969, Acxiom has locations throughout the United
States, Europe, Australia and China.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 7, 2006,
Standard & Poor's Ratings Services assigned its loan and recovery
ratings to Little Rock, Arkansas-based Acxiom Corp.'s proposed
$800 million secured first-lien financing.  The first-lien
facilities consist of a $200 million revolving credit facility and
a $600 million term loan.  They are rated 'BB' with a recovery
rating of '2'.


BAUSCH & LOMB: Files 2005 Annual Report with SEC
------------------------------------------------
Bausch & Lomb Inc. filed its annual report on Form 10-K for the
year ended Dec. 31, 2005, with the Securities and Exchange
Commission on Feb. 7, 2007.

The company was unable to timely file its 2005 Annual Report due
to:

   -- ongoing independent investigations conducted by the Board of
      Directors' Audit Committee;

   -- expanded year-end procedures that were not complete;

   -- expanded procedures with respect to the accounting for
      income taxes that were not complete; and

   -- continued efforts to complete the company's assessment of
      its internal control over financial reporting.

As a result of the Audit Committee's investigations and the
expanded procedures, the company identified errors made in the
application of generally accepted accounting principles that
impacted previously reported financial statements.

Consequently, management determined that it should restate its
previously issued:

   -- consolidated financial statements for fiscal years ended
      Dec. 27, 2003, and Dec. 25, 2004;

   -- financial information for the fiscal years ended 2001 and
      2002 (including a cumulative increase to 2001 beginning
      retained earnings of $34,000,000); and

   -- financial reports for the first and second quarters of 2005.

The company included the restated financial statements for the
years 2003 and 2004 in the 2005 annual report.

                            Financials

For the year ended Dec. 31, 2005, the company reported $19,200,000
of net income on $2,353,800,000 of net sales, compared with
$153,900,000 of net income on $2,233,500,000 of net sales for the
fiscal year ended Dec. 25, 2004.

At Dec. 31, 2005, the company had $3,416,400,000 in total assets,
$2,108,000,000 in total liabilities, and $1,283,900,000 in total
shareholders' equity.

A full-text copy of the company's 2005 annual report is available
for free at http://ResearchArchives.com/t/s?19c0

Headquartered in Rochester, New York Bausch & Lomb Inc. --
http://www.bausch.com/-- develops, manufactures, and markets eye
health products, including contact lenses, contact lens care
solutions, and ophthalmic surgical and pharmaceutical products.
The company is organized into three geographic segments: the
Americas; Europe, Middle East, and Africa; and Asia (including
operations in India, Australia, China, Hong Kong, Japan, Korea,
Malaysia, the Philippines, Singapore, Taiwan and Thailand).

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 6, 2007,
Moody's Investors Service downgraded Bausch & Lomb Inc.'s senior
unsecured debt to Ba1 and continues to review all ratings for
possible downgrade.  Moody's also assigned the company a Ba1
Corporate Family Rating.


CALPINE CORP: Court Approves Sutherland Asbill as Special Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Calpine Corp. and its debtor-affiliates to employ
Sutherland, Asbill & Brennan, LLP, as their special counsel for
certain energy matters pursuant to Sections 327(e) and 328 of the
Bankruptcy Code.

Sutherland will continue to represent the Debtors with respect
to the FERC-related matters and will continue to assist them in
policy or rulemaking proceedings at FERC.

Since 2001, Sutherland, Asbill & Brennan, LLP, has represented
the Debtors and certain of their affiliates with respect to
credit and risk issues, energy derivatives, forward contracts,
netting arrangements and other energy trading issues, among other
things.

Sutherland continues to represent the Debtors in their Chapter 11
cases as an ordinary course professional.  Currently, Sutherland
represents the Debtors in these matters:

   (a) Two pipeline rate cases before the FERC in which the
       Debtors are trying to minimize the cost of delivering
       natural gas to their plants.

   (b) Proceedings before the Federal Energy Regulatory
       Commission and related appellate litigation in which
       claims for refund have been asserted against them.

   (c) A proceeding to improve competitive conditions and access
       to markets in certain regions of the country.

As of Jan. 19, 2007, the Debtors have paid Sutherland $431,875
in accordance with the Ordinary Course Professional Order.  The
Debtors expect to continue to pay Sutherland $50,000 to $75,000
per month for its services.  Thus, Sutherland will exceed the
$500,000 aggregate cap imposed by the OCP Order.

The Debtors will pay Sutherland in its customary hourly rates:

      Professional                 Hourly Rate
      ------------                 -----------
      Partners                     $345 - $710
      Associates                   $210 - $410
      Paraprofessionals             $95 - $350

The Debtors will also reimburse Sutherland for any reasonable
out-of-pocket expenses.

Keith R. McCrea, Esq., at Sutherland, Asbill & Brennan, LLP,
in Houston, Texas, assures the Court that his firm does not
represent any interest adverse to the Debtors or their estates,
and is a "disinterested person" as the term is defined in Section
101(14) of the Bankruptcy Code.

Mr. McCrea says Sutherland has billed $522,265 for work performed
for the Debtors since the Petition Date.

Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies
customers and communities with electricity from clean, efficient,
natural gas-fired and geothermal power plants.  Calpine owns,
leases and operates integrated systems of plants in 21 U.S. states
and in three Canadian provinces.  Its customized products and
services include wholesale and retail electricity, gas turbine
components and services, energy management and a wide range of
power plant engineering, construction and maintenance and
operational services.

The company previously produced a portion of its fuel consumption
requirements from its own natural gas reserves.  However, in July
2005, the company sold substantially all of its remaining domestic
oil and gas assets to Rosetta Resources Inc.

The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200).  Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts.  Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors.  As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities.  (Calpine Bankruptcy News, Issue No. 38; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).  The Debtors' exclusive period to propose a
reorganization plan expires on June 20, 2007.


CENTRAL GARDEN: Reports $3 Million Net Loss for Qtr. Ended Dec. 30
------------------------------------------------------------------
Central Garden & Pet Company incurred a $3 million net loss for
the first quarter ended Dec. 30, 2006, compared to net income of
$2.6 million, in the same period last year.

At Dec. 30, 2006, the company's balance sheet showed $1.5 million
in total assets, $806,464 in total liabilities, and $727,359 total
stockholders' equity.

Depreciation and amortization for the quarter was $6.8 million
compared to $5.2 million in the year ago period.  Branded product
sales increased 14%.  Sales of other manufacturers' products
declined 11%.  Organic sales decreased 3%.

The company reported net sales of $317 million, an increase of
8% from $293 million in the comparable fiscal 2006 period.  Income
from operations for the quarter decreased 39% to $5.9 million from
$9.8 million in the year ago period.

Net sales for the Garden Products segment were $115 million, a
decrease of 8% from $126 million in the comparable fiscal 2006
period.  The Garden Products operating loss was $2.1 million
compared to a loss of $0.5 million in the year ago period.

Branded product sales decreased 4%. Sales of other manufacturers'
products declined 27%.  Organic sales decreased 10%.  Net sales
for the Pet Products segment were $202 million, an increase of 21%
from $167 million in the comparable fiscal 2006 period.  Operating
income for the Pet Products segment was $18 million relatively
unchanged from a year ago.  Branded product sales increased 28%.
Sales of other manufacturers' products declined 1%.  Organic sales
increased 3%.

"Our results for the quarter are disappointing and consistent with
our preannouncement on January 22.  These results reflect a late
quarter shift in purchases by lawn & garden retailers, lower sales
and a mix shift within the pet bird and small animal categories
and extraordinary increases in grain costs," noted Glenn Novotny,
President and Chief Executive Officer of Central Garden & Pet.
"These and certain other factors are impacting our expectations
for the full fiscal year 2007, and we have revised our outlook
accordingly.  Other factors affecting the year include lower
sales and profits in aquatics due primarily to a large retailer
announcement that it will no longer sell live fish in many of its
stores; execution challenges in our garden distribution operations
that are being addressed aggressively; and the impact of a later
than anticipated start-up of new garden manufacturing capacity due
to construction delays."

Net sales for fiscal 2007 are now projected to be between
$1.72 and $1.75 billion.  Operating income is expected to be
between $144 and $150 million.  Net income is expected to be
between $60 and $65 million.  The corresponding earnings per fully
diluted share before the distribution of the special 2-for-1 Class
A Common stock dividend is expected to be between $2.50 and $2.65.
After the distribution of the special stock dividend, earnings per
fully diluted share is expected to be between $0.83 and $0.88.
This guidance does not assume any additional acquisitions.

"The fundamentals of our business remain solid. We have strong
leadership positions in two great industries.  Our portfolio
of leading brands positions us to grow the business through
innovation, improved operations and strategic acquisitions,"
concluded Mr. Novotny.  "We are focused on executing our strategic
plan and committed to growing our market share and improving
returns to our shareholders."

A full-text copy of the company's financial report for Quarter
Ended Dec. 30, 2006 is available for free at:

               http://ResearchArchives.com/t/s?19bc

Headquartered in Walnut Creek, California, Central Garden & Pet
Company (NASDAQ: CENT) -- http://www.central.com/-- markets and
produces branded products for the lawn & garden and pet supplies
markets.  Products are sold to specialty independent and mass
retailers.  The company also provides a host of other regional and
application-specific garden and pet brands and supplies.  The
company has approximately 5,000 employees, primarily in North
America and Europe.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 28, 2006,
Moody's Investors Service affirmed its Ba3 corporate family rating
for Central Garden and Pet Company.  Additionally, Moody's held
its Ba2 probability-of-default rating on the company's
$350 million senior secured revolver.


CITIGROUP MORTGAGE: DBRS Rates $4.7 Mil. Class M-11 Certs. at BB
----------------------------------------------------------------
Dominion Bond Rating Service assigned these ratings to the Asset-
Backed Pass-Through Certificates, Series 2007-WFHE1 issued by
Citigroup Mortgage Loan Trust 2007-WFHE1.

   -- $185.4 million Class A-1 rated at AAA
   -- $78.0 million Class A-2 rated at AAA
   -- $47.4 million Class A-3 rated at AAA
   -- $33.1 million Class A-4 rated at AAA
   -- $18.5 million Class M-1 rated at AA (high)
   -- $21.7 million Class M-2 rated at AA
   -- $6.9 million Class M-3 rated at AA (low)
   -- $7.8 million Class M-4 rated at A (high)
   -- $8.3 million Class M-5 rated at "A"
   -- $6.3 million Class M-6 rated at A (low)
   -- $4.9 million Class M-7 rated at A (low)
   -- $4.0 million Class M-8 rated at BBB (high)
   -- $4.5 million Class M-9 rated at BBB
   -- $6.5 million Class M-10 rated at BBB (low)
   -- $4.7 million Class M-11 rated at BB

The AAA ratings on the Class A Certificates reflect 23.00% of
credit enhancement provided by the subordinate classes, initial
and target overcollateralization and monthly excess spread.
The AA (high) rating on Class M-1 reflects 18.85% of credit
enhancement.  The AA rating on Class M-2 reflects 14.00% of credit
enhancement.  The AA (low) rating on Class M-3 reflects 12.45% of
credit enhancement.  The A (high) rating on Class M-4 reflects
10.70% of credit enhancement.  The "A" rating on Class M-5
reflects 8.85 % of credit enhancement.  The A (low) rating on
Class M-6 reflects 7.45% of credit enhancement.  The A (low)
rating on Class M-7 reflects 6.35% of credit enhancement.  The BBB
(high) rating on Class M-8 reflects 5.45% of credit enhancement.
The BBB rating on Class M-9 reflects 4.45% of credit enhancement.
The BBB (low) rating on Class M-10 reflects 3.00% of credit
enhancement.  The BB rating on Class M-11 reflects 1.95% of credit
enhancement.

The ratings on the Certificates also reflect the quality of the
underlying assets and the capabilities of Wells Fargo Bank, N.A.
as Servicer, as well as the integrity of the legal structure of
the transaction. U.S. Bank National Association will act as
Trustee.  The Certificate holders will receive the benefits of
an interest rate cap agreement with a strike of 6.5% with Bear
Stearns Financial Products Inc.

Interest and principal payments collected from the mortgage loans
will be distributed on the 25th day of each month commencing in
February 2007.  Interest will be paid first to the Class A
Certificates on a pro rata basis and then sequentially to the
subordinate certificates.  Until the step-down date, principal
collected will be paid exclusively to the Class A Certificates
unless their respective note balances have been reduced to zero.
After the step-down date, and provided that certain performance
tests have been met, principal payments will be distributed
among all classes on a pro rata basis.  Additionally, provided
that certain performance tests have been met, the level of
overcollateralization may be allowed to step down to 3.90% of
the then-current balance of the mortgage loans but no less than
0.50% of original collateral balance.

All mortgage loans in the Underlying Trust were originated or
acquired by Wells Fargo Bank, N.A. As of the cut-off date, the
aggregate principal balance of the mortgage loans is $447,648,541.
The weighted average mortgage rate is 8.633%, the weighted average
FICO is 617, and the weighted average combined loan-to-value ratio
is 83.84%.


CONEXANT SYSTEMS: Earns $7.4 Million in Fiscal 2007 First Quarter
-----------------------------------------------------------------
Conexant Systems Inc. reported $7.4 million of net income on
$245.5 million of revenues for the first quarter of fiscal 2007,
compared with $7.3 million of net income on $245.9 million of
revenues for the same period of fiscal 2006.

Core operating expenses increased in the first quarter of fiscal
2007 to $93.6 million as a result of increased investments in new
product development.  Core operating expenses in the year-ago
quarter were $83.1 million.

Core operating income was $16 million compared to $13 million in
the first quarter of fiscal 2006.

"In the first fiscal quarter, despite a clearly challenging market
environment, the Conexant team delivered financial results that
met the expectations we set entering the quarter," said Dwight W.
Decker, Conexant chairman and chief executive officer.

At Dec. 31, 2006, the company's balance sheet showed $1.9 billion
in total assets, $1.3 billion in total liabilities, and
$531.3 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19af

                       About Conexant Systems

Headquartered in Newport Beach, California, Conexant Systems, Inc.
(NASDA: CNXT) -- http://www.conexant.com/-- designs, develops and
sells semiconductor system solutions that connect personal access
products such as set-top boxes, residential gateways, PCs and game
consoles to voice, video and data processing services over
broadband and dial-up connections.  Key semiconductor products
include digital subscriber line and cable modem solutions, home
network processors, broadcast video encoders and decoders, digital
set-top box components and systems solutions, and the company's
foundation dial-up modem business.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 31, 2006,
Moody's Investors Service assigned a B1 rating to the senior
secured floating rate notes and a Caa1 rating to the corporate
family rating of Conexant Systems Inc.

Moody's also assigned a Probability of default rating of Caa1, a
LGD-2 rating for the senior secured notes and a SGL-3 speculative
grade liquidity rating.  The rating outlook is stable.


COUDERT BROTHERS: Accepting File Retrieval Notices Until April 30
-----------------------------------------------------------------
On Jan. 22, 2007, the U.S. Bankruptcy Court for the Southern
District of New York authorized Coudert Brothers LLP to dispose of
certain client files remaining in its possession.

Parties who believe that their file(s) are in the possession
of the Debtor may retrieve those file(s) by completing and
returning a file retrieval form no later than Apr. 30, 2007.  File
retrieval forms are available at http://www.kccllc.net/coudert/

Files may also be retrieved by contacting the Debtor's bankruptcy
counsel:

      Klestadt & Winters LLP
      17th Floor
      292 Madison Avenue
      New York 10017
      Tel: (212) 972-3000
      Fax: (212) 972-2245

Coudert Brothers LLP was an international law firm specializing in
complex cross border transactions and dispute resolution.  The
firm had operations in Australia and China.  The Debtor filed for
Chapter 11 protection on Sept. 22, 2006 (Bankr. S.D.N.Y. Case
No. 06-12226).  John E. Jureller, Jr., Esq., and Tracy L.
Klestadt, Esq., at Klestadt & Winters, LLP, represents the Debtor
in its restructuring efforts.  Brian F. Moore, Esq., and David J.
Adler, Esq., at McCarter & English, LLP, represent the Official
Committee Of Unsecured Creditors.  In its schedules of assets
and debts, Coudert listed total assets of $29,968,033 and total
debts of $18,261,380.  The Debtor's exclusive period to file a
plan of reorganization expires on May 20, 2007.


CREDIT SUISSE: Moody's Holds Junk Rating on $19MM Class I Certs.
----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes
and affirmed the ratings of seven classes of Credit Suisse First
Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 1998-C2:

   -- Class A2, $916,635,429, Fixed, affirmed at Aaa
   -- Class AX, Notional, affirmed at Aaa
   -- Class B, $105,600,000, Fixed, affirmed at Aaa
   -- Class C, $105,600,000, Fixed, affirmed at Aaa
   -- Class D, $105,500,000, Fixed, affirmed at Aaa
   -- Class E, $28,800,000, Fixed, upgraded to Aaa from Aa1
   -- Class F, $105,600,000, Fixed, upgraded to Ba1 from Ba2
   -- Class G, $19,200,000, Fixed, upgraded to Ba2 from Ba3
   -- Class H, $47,900,000, Fixed, affirmed at B3
   -- Class I, $19,200,000, Fixed, affirmed at C

As of the Jan. 20, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 24.0%
to $1.5 billion from $1.9 billion at securitization.  The
Certificates are collateralized by 194 mortgage loans ranging in
size from less than 1% to 5.4% of the pool, with the top 10 loans
representing 41.5% of the pool.  The pool consist of one shadow
rated loan, representing 4.6% of the pool, a conduit component,
representing 32% of the pool, and a credit tenant lease component,
representing 12% of the pool.  The balance is collateralized by 69
loans, representing 51.4% of the pool, which have been defeased
and been replaced with U.S. Government securities.  The largest
defeased loans include Intell/Reichmann Portfolio, 260-261 Madison
Avenue and Patriot American Portfolio.

Twelve loans have been liquidated from the pool, resulting in
aggregate realized losses of approximately $34.1 million.  Four
loans, representing 2.3% of the pool, are in special servicing.
Moody's has estimated aggregate losses of approximately $200,000
for all of the specially serviced loans.  Twenty-eight loans,
representing 10.8% of the pool, are on the master servicer's
watchlist.

Moody's was provided with year-end 2005 operating results for
approximately 91.1% of the performing loans and partial year 2006
operating results for approximately 32.7% of the performing loans.
Moody's loan to value ratio for the conduit component is 89.1%,
compared to 88.5% at last review and compared to 88.9% at
securitization.

Moody's is upgrading Classes E, F and G due to a large percentage
of defeased loans and the improved performance of the shadow rated
loan.  Moody's upgraded Classes D and E on Dec. 8, 2006 based on a
Q tool based portfolio review.

The shadow rated loan is the 180 Water Street Loan at
$66.9 million (4.6%), which is secured by a 505,000 square foot
office building located in the Financial District submarket of New
York City.  The property is 100% leased to the City of New York
Department of Citywide Administrative Services under a long-term
lease which expires in June 2018.  The loan matures in August
2013. Moody's current shadow rating is A3, compared to Ba1 at last
review and compared to Ba2 at securitization.

The top three non-defeased conduit exposures represent 10.8% of
the outstanding pool balance.  The largest non-defeased conduit
exposure is the Butera Portfolio at $74.3 million (5.1%), which is
secured by a portfolio of seven industrial properties, five office
buildings and two retail centers.  Built between 1986 and 1998,
the properties are primarily located within the
Washington-Baltimore MSA and total 1.4 million square feet.  The
average occupancy of the portfolio is 92%, compared to 95% at last
review and compared to 98.5% at securitization.  Moody's LTV is
89.2%, compared to 91.5% at last review and compared to 95.8% at
securitization.

The second largest non-defeased conduit exposure is the Koll
Corporate Plaza Loan at $49.4 million (3.4%), which is secured by
a 612,253 square foot office park.  The property consists of six,
four-story office buildings and is located in Iselin, New Jersey
approximately 20 miles southwest of Manhattan.  As of June 2006
occupancy was 67%, compared to 68% at year-end 2005 and compared
to 91% at securitization.  The property lost tenants in calendar
year 2002 and has had difficulty competing with newer properties
in the area.  Competing Class A properties are offering comparable
rents.  Overall performance has declined because of a decrease in
revenue and an increase in operating expenses.  Moody's LTV is in
excess of 100%, the same as at last review and compared to 88.6%
at securitization.

The third largest non-defeased conduit exposure is the Camco
Portfolio Loan at $33.7 million (2.3%), which is secured by two
retail properties and one industrial property totaling 547,000
square feet.  The properties are located in North Richland Hills
and Irving.  Both cities are located between Dallas and Fort
Worth, Texas.  Current occupancy is 91.2%, compared to 93.8% at
securitization.  Performance has improved since Moody's last
review due to increased revenue.  Moody's LTV is 96.1%, compared
to in excess of 100% at last review and compared to 90.2% at
securitization.

The CTL component includes 35 loans secured by properties under
bondable, triple-net or double-net leases.  The largest exposures
are Motel 6/Accor SA and CVS.

The pool's collateral is a mix of U.S. Government securities,
office, CTL, retail, industrial and self storage, multifamily and
manufactured housing, lodging and healthcare.  The collateral
properties are located in 47 states plus the District of Columbia.
The highest state concentrations are New York, Texas, Maryland,
New Jersey and California.  All of the loans are fixed rate.


CREDIT SUISSE: Moody's Hold Rating on $18MM Class L Certs. at Ba1
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of eight classes
and affirmed the ratings of six classes of Credit Suisse First
Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 2005-TFL2:

   -- Class A-1, $50,702,678, Floating, affirmed at Aaa
   -- Class A-2, $181,500,000, Floating, affirmed at Aaa
   -- Class A-X-1, Notional, affirmed at Aaa
   -- Class A-X-2, Notional, affirmed at Aaa
   -- Class B, $37,000,000, Floating, upgraded to Aaa from Aa1
   -- Class C, $35,000,000, Floating, upgraded to Aaa from Aa2
   -- Class D, $16,000,000, Floating, upgraded to Aa1 from Aa3
   -- Class E, $14,000,000, Floating, upgraded to Aa2 from A1
   -- Class F, $21,000,000, Floating, upgraded to Aa3 from A2
   -- Class G, $17,500,000, Floating, upgraded to A2 from A3
   -- Class H, $16,500,000, Floating, upgraded to A3 from Baa1
   -- Class J, $17,000,000, Floating, upgraded to Baa1 from Baa2
   -- Class K, $14,500,000, Floating, affirmed at Baa3
   -- Class L, $18,600,000, Floating, affirmed at Ba1

The Certificates are collateralized by eight mortgage loans or
mortgage loan participations.  As of the Jan. 16, 2007
distribution date, the transaction's aggregate certificate balance
has decreased by approximately 53.7% to $439.3 million from
$948.1 million at securitization as a result of the payoff of 10
loans initially in the pool.  The remaining loans range in size
from 6.6% to 27.3% of the pool.

Moody's is upgrading Classes B, C, D, E, F, G, H, and J due to
improved credit support for the Certificates resulting from loan
payoffs and the satisfactory performance of the collateral
supporting the remaining loans.

The Bay Area Office Portfolio Loan is supported by four
cross-collateralized office properties containing 1.4 million
square feet of rentable area.  The properties are located in San
Francisco, Foster City and San Rafael, California.

At securitization, overall occupancy was 54.8% although
substantial improvement was anticipated.  As of December 2006
occupancy had increased to 76.1%.  The loan sponsors are Sterling
American Property, Inc. and Hines Interests.  Moody's current net
cash flow and loan to value ratio are $16.7 million and 64%,
compared to $16.8 million and 63.4% at securitization.  Moody's
current shadow rating is Baa3, the same as at securitization.

The Westin Hotel Portfolio Loan is supported by two resort hotels
containing a total of 899 rooms.  The Westin La Paloma is a
487-room hotel located on 174 acres in Tucson, Arizona.  The
Westin Hilton Head, located in Hilton Head, South Carolina,
contains 412 rooms.  Net cash flow for calendar year 2005 exceeded
Moody's expectations.  RevPAR increased by 1.2% and EBITDA by 7%
for the first nine months of 2006 as compared to the same period
the previous year.  The loan is sponsored by Starwood Capital
Group Global, L.L.C. Moody's net cash flow and LTV are
$16.3 million and 58.6%, compared to $15.8 million and 60.5% at
securitization.  Moody's current shadow rating is Baa3, the same
as at securitization.

The Walton Street-Renaissance Mayflower & Renaissance Scottsdale
Cottonwoods Loan is supported by two full service hotels
containing a total of 828 rooms.  The Renaissance Mayflower is a
657-room hotel located in Washington D.C.  The Renaissance
Scottsdale Cottonwoods, which is located in Scottsdale, Arizona,
contains 171 rooms.  Net cash flow for calendar year 2005 was
approximately 5.5% less that Moody's expectations, which
anticipated performance improvement once the common areas, meeting
rooms and restaurants at the hotel were renovated at an estimated
cost of $7.1 million.  These capital projects took place in 2006
and have negatively impacted group business and banquet revenue
for the first nine periods of 2006.  The loan sponsor is Walton
Street Real Estate Fund, IV, L.P.  Moody's net cash flow and LTV
are $14.5 million and 55.3%, compared to $14.7 million and 54.7%
at securitization.  Moody's current shadow rating is Baa1, the
same as at securitization.

The Walton Street-Renaissance Chicago Loan is supported by a
553-room full service hotel located in Chicago, Illinois.  Net
cash flow for calendar year 2005 met Moody's expectations.
Performance for the first nine months of 2006 increased by 25.6%
compared to the comparable prior year period on both a RevPAR and
a net cash flow basis.  The loan sponsor is Walton Street Real
Estate Fund, IV, L.P.  Moody's net cash flow and LTV are
$8.7 million and 54.2%, compared to $8 million and 59.1% at
securitization.  Moody's current shadow rating is Baa1, compared
to Baa3 at securitization.

The remaining three loans are shadow rated as:

   -- The Castleton Office Park Portfolio Loan at Baa3;

   -- the Walton Street-Renaissance Esmeralda Resort & Spa Loan
      at Ba1; and,

   -- the Walton Street-Renaissance Vinoy Resort & Golf Club
      at Baa1.


CSFB ABS: S&P Cuts Rating on Series 2002-HE1 Class B Certs. to BB
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the class
B mortgage pass-through certificates from CSFB ABS Trust Series
2002-HE1 to 'BB' from 'BBB' and placed it on CreditWatch with
negative implications.

At the same time, ratings were affirmed on the remaining four
classes from this transaction.

The downgrade and CreditWatch placement reflect the continued
erosion of credit support for the class due to monthly net losses
that have significantly exceeded monthly excess interest cash
flow.

As a result, the overcollateralization had been reduced to about
0.23% as of the January 2007 distribution period, compared with a
target of 0.50%.  In addition, total delinquencies were
approximately 45% of the outstanding pool balance, and severe
delinquencies represented roughly 24.11%.  The transaction has
incurred cumulative realized losses totaling approximately 3.59%
of the original pool balance.  The transaction is 59 months
seasoned and has paid down to approximately 9.04% of its original
size.

Standard & Poor's will continue to closely monitor the performance
of this transaction.  If losses decline to a point at which they
no longer exceed excess interest, and the level of O/C has not
been further eroded, Standard & Poor's will affirm the rating and
remove it from CreditWatch.

Conversely, if losses continue to exceed excess interest and
further erode O/C, Standard & Poor's will take additional negative
rating actions.

Credit support is provided by subordination, O/C, and excess
spread.  The collateral consists of 30-year, fixed or adjustable
rate, fully amortizing subprime mortgage loans secured by first
liens on one- to four-family residential properties.

            Rating Lowered And Placed On Creditwatch Negative

                    CSFB ABS Trust Series 2002-HE1

                 Mortgage Pass-Through Certificates
                          Series 2002-He1

                                   Rating
                                   ------
                  Class      To              From
                  -----      --              ----
                  B          BB/Watch Neg    BBB

                         Ratings Affirmed

                  CSFB ABS Trust Series 2002-HE1

          Mortgage Pass-Through Certificates Series 2002-He1

                  Class                   Rating
                  -----                   ------
                  A-1, A-2                AAA
                  M-1                     AA+
                  M-2                     A


DAVITA INC: Loan Add-on Cues S&P to Hold BB- Corp. Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on DaVita
Inc.'s unsecured financing, following the company's $400 million
add-on to its unsecured senior notes due March 2013.

"The refinancing lowers the company's interest expense by about
$4 million," explained Standard & Poor's credit analyst Jesse
Juliano.

"The proceeds from the note issuance will be used to repay a
portion of its term loan debt."

As a result of this and other debt prepayment, the ratings on the
senior secured bank lines, which consist of a $250 million secured
revolving credit facility due in 2011, a $280 million senior
secured term loan A due in 2011, and a $1.7 billion senior secured
term loan B due in 2012, were revised to 'BB' with a recovery
rating of '1', indicating that lenders can have a high expectation
of recovery of principal in the event of a payment default.

Other existing ratings on DaVita, including the 'BB-' corporate
credit rating, were affirmed.

The rating outlook is stable.

The ratings on DaVita Inc. reflect the company's dependence on the
treatment of a single disease, rendering it vulnerable to cuts or
insufficient increases in third-party reimbursement rates.  The
ratings also reflect the company's cost-management challenges and
DaVita's aggressive financial policies.  These factors are partly
offset by the stabilizing effects of the company's recurring
revenue stream, its large clinic network with a leading U.S.
market position, and its attractive growth prospects.

While DaVita's profitability and cash flow appear strong, Standard
& Poor's remains concerned about the company's very aggressive
capital structure.  As of Sept. 30, 2006, DaVita had $3.82 billion
of debt outstanding.  Total lease-adjusted debt to EBITDA is about
5x but should decline over time.  The company's financial
flexibility should provide cushion for operating shortfalls, given
its strong operating cash flow, revolving credit facility
availability, and lack of material debt maturities until its term
loans come due in 2011.


DAVITA INC: Moody's Rates New $400 Mil. Senior Unsecured Notes B1
-----------------------------------------------------------------
Moody's assigned a B1 rating to DaVita Inc.'s new issuance of up
to $400 million of senior unsecured notes.  The issuance of up to
$400 million of additional unsecured notes is not expected to have
an effect on DaVita's leverage metrics as Moody's expects further
repayment of the outstanding term loans with the proceeds.

Moody's understands that the terms of the new notes will be
essentially the same as the existing senior unsecured notes.

Moody's also upgraded DaVita's Corporate Family Rating to Ba3 from
B1.

This rating was assigned:

   -- $400 million of senior unsecured notes, rated B1, LGD4, 68%

Ratings are subject to receipt and review of final documentation.

DaVita, Inc., headquartered in El Segundo, California, is an
independent provider of dialysis services in the U.S. for patients
suffering from end-stage renal disease.  As of Dec. 31, 2006,
DaVita operated or managed 1,300 outpatient facilities in 42
states, as well as Washington D.C., serving approximately 103,000
patients.  Moody's estimates that DaVita had revenue of
approximately $4.7 billion for the twelve months ended
Sept. 30, 2006.


DELPHI CORP: Wants to Sell Brake Hose Biz to Harco Mfg. for $9.8MM
------------------------------------------------------------------
Delphi Corp. and its debtor-affiliates seek authority from the
Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York to sell their Brake Hose Business
and certain of Delphi Technologies Inc.'s intellectual property
related to the Brake Hose Business to Harco Mfg. for $9,800,000,
free and clear of liens, claims, and encumbrances, subject to
higher and better bids.

The Debtors supply a complete array of brake hose assemblies for
various vehicles from small automobiles to mid-size trucks.  The
Debtors operate the Brake Hose Business as part of the Chassis
Systems Product Business Unit within their Automotive Holdings
Group Division.

The Debtors deliver brake hose components to Harco Brake Systems
Inc. for final assembly.  Harco Manufacturing Group LLC, an
affiliate of Harco Brake, then ships the finished products to
General Motors Corporation.  The Debtors are a Tier I supplier to
GM and a Tier II supplier to several Tier I brake hose assembly
suppliers to GM.

The Debtors' brake hose product line has been an ongoing business
concern since 1936, John Wm. Butler, Jr., Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in Chicago, Illinois, relates.  In
1997, the brake hose final assembly operation was moved to Harco
Mfg.

The Debtors inform the Court that the Brake Hose Business does
not fit within the anticipated product portfolio under their
transformation plan.  The Debtors believe they lack a global
manufacturing presence in the Brake Hose product line to make the
Business grow.  The Debtors, however, believe that as a stand
alone business unencumbered by legacy costs, the Brake Hose
product line could be a profitable and competitive business line.

When the Debtors' long-term supply agreement with Harco Mfg.
expired in 2004, Delphi Automotive Systems LLC and Harco Mfg.
executed an extension of the term of the Agreement through
Dec. 31, 2007, under a Brake Hose Assembly Contract Policy
Statement.

The Policy Statement, among other things, provides that:

   -- DAS will pay Harco $2,500,000 in cancellation costs if the
      Brake Hose Business is in-sourced or completely exited by
      DAS;

   -- Harco is entitled to a right of first refusal to buy the
      brake hose business before any alternative purchaser is
      considered by DAS; and

   -- Harco or an alternative purchaser of the Business must
      assume the Statement, whereby the Debtors would have no
      further obligations under it.

Since early 2005, the Debtors exerted efforts to market the Brake
Hose Business and ultimately, determined that Harco Mfg.'s bid is
the best offer for the Business.

Subsequently, the Debtors and Harco Mfg. entered into a Purchase
Agreement for the sale for Brake Hose Business on Jan. 25, 2007.

The salient terms of the Purchase Agreement are:

   * The Purchase Price represents $9,750,000 for the Acquired
     Assets and $50,000 for the Intellectual Property;

   * Harco will place $500,000 of the Purchase Price into an
     escrow account, and another $750,000 into an indemnity
     escrow account;

   * Harco is entitled to a $294,000 Break-Up Fee if the Debtors
     sell, transfer, lease, or otherwise dispose the Acquired
     Assets to another party; and

   * The Debtors will reimburse Harco, up to $100,000, for
     reasonable and actual out-of-pocket fees and expenses it
     incurred in connection with the transactions contemplated by
     the Agreement upon the Agreement's termination when:

        -- the Closing fails to occur within 90 days after the
           Court approves the Sale; or

        -- the Court fails to enter a Sale Order by May 25, 2007,
           or the Sale Order is subject to a stay or injunction.

In the event Harco Mfg. is entitled to receive both the Break-Up
Fee and the Expense Reimbursement, Harco Mfg. will only be
awarded with the larger of the two amounts.

The Agreement does not provide for a transfer of the Business's
workforce to Harco Mfg.  Under a manufacturing services agreement
to be entered into at the Sale's Closing, the Debtors' hourly
employees will continue to produce brake hose products for a
maximum period of 12 months.  Under a transition services
agreement, salaried employees of the Business will support those
activities for a similar period.

The Business's hourly workforce is represented by the United
Steel, Paper And Forestry, Rubber, Manufacturing, Energy, Allied
Industrial And Service Workers International Union.  The Debtors
are currently negotiating with the USW to obtain the labor
union's waiver of any no-sale clause contained in agreements
between Delphi Corporation and the USW prior to the Closing, Mr.
Butler informs the Court.

Pursuant to the Agreement, the Debtors also seek to assume and
assign certain executory contracts, unexpired leases, and
liabilities to Harco Mfg. or an alternative purchaser.  To the
extent that any defaults exist under the Assumed and Assigned
Contracts or Leases, the Debtors intend to cure those defaults
prior to any assumption and assignment.

A full-text copy of the Harco Sale and Purchase Agreement is
available for free at http://ResearchArchives.com/t/s?1928

                       Bidding Procedures

To maximize the value of their property, the Debtors seek to
subject the proposed sale to better and higher offers.
Accordingly, the Debtors ask the Court to approve uniform bidding
procedures to govern the sale of the Brake Hose Business.

For a potential bidder to become a Qualified Bidder, it must:

   -- execute a confidentiality agreement;

   -- provide certain financial assurances as to its ability to
      close a transaction; and

   -- submit a preliminary purchase proposal.

The Debtors propose to establish 11:00 a.m., March 2, 2007, as
the Bid Deadline.

For a bid to be deemed a Qualified Bid, it must be received by
the Bid Deadline and, among other things, must have a value
greater than the aggregate value of the Purchase Price, the
Break-Up Fee, and $500,000.  The Bid must not be conditioned on
bid protections and must include a commitment to consummate the
purchase of the Acquired Assets within 15 days after the Court
approves the alternative purchase.

If the Debtors receive a Qualified Bid, they will conduct an
auction of the Acquired Assets before March 20, 2007.

A full-text copy of the proposed Bidding Procedures for the sale
of the Brake Hose Business is available for free at
http://ResearchArchives.com/t/s?1971

The Court will conduct a hearing on March 22, 2007, to consider
the Proposed Sale.

Troy, Mich.-based Delphi Corporation (OTC: DPHIQ) --
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 Corporation Bankruptcy News,
Issue No. 56; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


EASTLAND CLO: $48 Million Class D Notes Rated BB by S&P
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to the Eastland CLO Ltd./Eastland CLO Corp.
$1.4081 billion floating-rate notes.

The preliminary ratings are based on information as of
Feb. 9, 2007.  Subsequent information may result in the assignment
of final ratings that differ from the preliminary ratings.

The preliminary ratings reflect:

   -- The credit enhancement provided to each class of notes
      through the subordination of cash flows to the more junior
      classes and preference shares;

   -- The transaction's cash flow structure, which has been
      subjected to various stresses requested by
      Standard & Poor's;

   -- The experience of the collateral manager; and

   -- The legal structure of the transaction, including the
      bankruptcy remoteness of the issuer.

                    Preliminary Ratings Assigned

                Eastland CLO Ltd./Eastland CLO Corp.

          Class                  Rating            Amount
          -----                  ------         ------------
          A-1                    AAA            $100,000,000
          A-2a                   AAA            $825,600,000
          A-2b                   AAA            $206,000,000
          A-3                    AA              $78,500,000
          B                      A               $81,500,000
          C                      BBB             $68,500,000
          D                      BB              $48,000,000
          Preference shares      NR             $123,500,000

                           NR -- Not rated.


EASTMAN KODAK: Details Major Restructuring by End of 2007
---------------------------------------------------------
Eastman Kodak Company has reported significant progress in the
implementation of its digital business strategy, led by new
product introductions across its consumer and commercial
portfolio, the continued integration and growth of its Graphic
Communications Group, and accelerated cost reductions that will
follow the divestiture of its Health Group.

At a meeting with investors, Kodak detailed the plan that it is
following to generate profitable digital growth in 2007 and to
position itself for further success in 2008 and beyond.  The
presentation also covered Kodak's plan to complete its major
business restructuring by the end of 2007, as the company
progresses toward its target business model.  The company expects
that target business model to yield gross profit margins of 28% to
29% with earnings from operations equal to 8% to 9% of revenue in
2009.

"During the past three years we have made visible and significant
progress in creating the new Kodak," Eastman Kodak Company
Chairman and Chief Executive Officer Antonio M. Perez said.

"We have built the industry's leading provider of products and
services for commercial printers, and this week we launched a
long-awaited breakthrough value proposition for consumers in the
inkjet market.  In 2007, we are continuing to move aggressively to
complete the transformation of our business operations and fully
implement a business model which will power our future success in
digital markets."

            Business Units Poised for Profitable Growth

During 2006, the company's Consumer Digital Group made significant
progress in achieving its digital operating model, delivering a
$132 million improvement in earnings and positive cash
contribution for the year.  For 2007, the company expects Consumer
Digital Group revenues to be steady on a year-over-year basis,
driven by new product introductions in consumer inkjet and image
sensors and growth in the Kodak Gallery and Kodak Picture Kiosks,
partially offset by declines in consumer paper.

The company forecasted improved earnings for CDG, driven by image
sensors, home printing, the Kodak Gallery, Kodak Picture Kiosks
and consumer paper, plus the benefit from the company's ongoing
intellectual property licensing program.

"As an early investor in digital technology, Kodak has amassed a
sizeable amount of extremely valuable intellectual property," Mr.
Perez said.  "We are committed to generating value from that asset
by using it to drive business partnerships, provide the company
with access to new markets and additional technology, and to
generate earnings and cash."

For 2007, the company expects revenue and earnings from
intellectual property licensing of at least $250 million.

The Graphic Communications Group continues to remain ahead of its
integration plan and, in 2007, the company expects the business to
grow digital revenue between 6% and 9% with expanding earnings.
Key areas of profitable growth and market leadership for GCG
include digital plates, inkjet-printing solutions, document
imaging, electrophotographic digital printing, and workflow
software.

                       Financial Priorities

Kodak remains focused on three priorities as it continues to
transform its business: net cash generation, digital earnings from
operations, and digital revenue growth.

For 2007, on a continuing operations basis, Kodak expects net cash
generation (formerly investable cash flow) of $100 million to
$200 million after restructuring disbursements of approximately
$600 million and an aggressive introduction plan for inkjet
products.  The company also expects to generate digital earnings
from operations of $200 million to $300 million on digital revenue
growth of 3% to 5%.

"As we enter the final year of our transformation, we are focused
on completing the restructuring of our traditional operations,
reducing debt, and refining our cost model in order to create a
foundation for sustainable and profitable growth," Eastman Kodak
Company Chief Financial Officer Frank S. Sklarsky said.

"We continue to generate sufficient cash in order to fund these
efforts, and also to support the launch of key new products that
will drive our future growth in revenue and earnings."

                 Achieving the Targeted Cost Model

The company has set a goal of building a business model to achieve
sustained success in digital markets, supported by achieving
selling, general, and administrative expenses level equal to 14%
to 15% of revenue by 2009.  For 2006, the company's selling,
general, and administrative expenses level was approximately 18%
of revenue.

"Our manufacturing cost reductions are in the final stages of
implementation," Mr. Sklarsky said.  "We defined what had to be
done and the team has moved aggressively to do it.  We are now
bringing the same focus and intensity to driving reductions in our
SG&A expenses in order to achieve our target business model."

As part of achieving these cost reductions, the company expects to
make restructuring payments of $575 million to $625 million in
2007, with a focus on addressing the anticipated cost overhang
following the completion of its Health Group divestiture.  By the
end of 2007, the company expects to have made substantial progress
in establishing a business model that will support sustained
profitable growth in the digital markets in which it operates.

                             Job Cuts

Kodak's restructuring program was first announced in January 2004
and updated in July 2005 and August 2006.  As of August 2006, the
program anticipated the elimination of 25,000 to 27,000 positions
and charges totaling $3 billion to $3.4 billion.

During the fourth quarter of 2006, the company eliminated
approximately 1,200 positions, bringing the program's total
to-date to approximately 23,400 positions along with cumulative
charges of $2.7 billion.

Based on the restructuring and selling, general, and
administrative expenses reduction actions to-date, and an
understanding of the remaining actions to conclude these
activities by the end of 2007, influenced by the divestiture of
the Health Group, the company now expects that the total
employment reductions will be in the range of 28,000 to 30,000
positions and total charges will be in the range of $3.6 billion
to $3.8 billion.  The company expects that these actions will
allow it to conclude its major restructuring program by the end of
2007.

"Kodak is now a company comprised of numerous leading digital
businesses with diverse sources of sales and earnings, coupled
with strong intellectual property positions," Mr. Perez said.

"Our dramatic operational improvements during the past three years
have created a solid foundation from which Kodak will become a
growing digital company with innovative new products and services,
attractive margins and strong cash generation."

                      About Eastman Kodak Co.

Headquartered in Rochester, New York, Eastman Kodak Co. (NYSE: EK)
-- http://www.kodak.com/-- develops, manufactures, and markets
digital and traditional imaging products, services, and solutions
to consumers, businesses, the graphic communications market, the
entertainment industry, professionals, healthcare providers, and
other customers.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 2, 2007,
Moody's Investors Service reviewed Eastman Kodak Company's ratings
for possible downgrade including Corporate Family Rating at B1,
Senior Unsecured Rating at B2, and Senior Secured Credit
Facilities at Ba3.


EDDIE BAUER: CEO and Board Member Fabian Mansson Resigns
--------------------------------------------------------
Eddie Bauer Holdings Inc. disclosed the resignation of its
President, Chief Executive Officer and Board member, Fabian
Mansson.

Howard Gross, a member of the Board, has been named Interim CEO as
the Board conducts a search for a permanent CEO.  Mr. Gross has
over 35 years of experience in the retail apparel industry, having
served as President and CEO of Limited Stores and Victoria's
Secret Stores, as well as CEO of the Hub Distributing, Millers
Outposts, and Levi's Outlet Stores divisions of American Retail
Group, Inc.

"On behalf of the entire Board, I'd like to thank Fabian for his
leadership over the past four and a half years," William End,
Chairman of the Board, said.  "He guided the Company through its
difficult reorganization and the early stages of its turnaround
and restored positive sales momentum this past Holiday season with
the refocusing of the Company's product line.  We wish him well in
his future endeavors."

"Our Board is committed to taking the necessary actions to put
Eddie Bauer on a path to improve its performance and capitalize on
the strong potential of its brand," Mr. Gross commented.  "We are
moving forward thoughtfully and expeditiously to position the
Company to execute its turnaround strategy."

At a special stockholders meeting held Feb. 8, 2007, an
insufficient number of shares were voted in favor of approving the
company's proposed sale to Eddie B Holding Corp., a company owned
by affiliates of Sun Capital Partners Inc. and Golden Gate
Capital.  As a result, the Board is evaluating appropriate next
steps for the company to effectuate its turnaround.

Headquartered in Redmond, Washington, Eddie Bauer Holdings Inc.
(NASDAQ: EBHI) -- http://www.eddiebauer.com/-- is a specialty
retailer that sells casual sportswear and accessories for the
"modern outdoor lifestyle."  Established in 1920 in Seattle, Eddie
Bauer products are available at approximately 380 stores
throughout the United States and Canada, through catalog sales and
online at http://www.eddiebaueroutlet.com/ The company also
participates in joint venture partnerships in Japan and Germany
and has licensing agreements across a variety of product
categories.  Eddie Bauer employs approximately 10,000 part-time
and full-time associates in the United States and Canada.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 13, 2006,
Moody's Investors Service confirmed Eddie Bauer Inc.'s B2
Corporate Family Rating.  Moody's also confirmed its B2 rating on
the company's 300 million term loan.


ELCOM INT'L: Selects John Halnen as Interim President & CEO
-----------------------------------------------------------
Elcom International Inc. disclosed that John E. Halnen, the
company's president and chief executive officer, will serve as its
principal financial officer and principal accounting officer
on an interim basis until such time the company appoints a
new officer to serve in those positions.

Although he does not have a specific financial background,
Mr. Halnen has served as the chief executive officer of the
company since December 2005, as president of the company
since November 2000 and as a Director of the company since
June 2003.

Mr. Halnen served as the company's principal financial officer
and principal accounting officer during the period of July 21,
2006 to Oct. 2, 2006, prior to the hiring of Mr. Bogonis.

Paul Bogonis, vice president of finance and controller, is
no longer employed effective Feb. 6, 2007.  The company is
in discussions with Mr. Bogonis related to final severance
arrangements.

                        Going Concern Doubt

Vitale, Caturano & Company Ltd. expressed substantial doubt about
Elcom International's ability to continue as a going concern after
it audited the company's financial statements for the years ended
Dec. 31, 2005.  The auditing firm pointed to the company's net
losses every year since 1998, has an accumulated deficit of
$126,252,000 as of Sept. 30, 2006.

A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?1712

Elcom International, Inc. (OTC Bulletin Board: ELCO and AIM: ELC
and ELCS) -- http://www.elcominternational.com/-- operates Elcom
Inc., an international B2B Commerce Service Provider offering
affordable solutions for buyers, sellers and commerce communities
to automate many or all of their purchasing processes and conduct
business online.  PECOS, Elcom's remotely hosted flagship
solution, enables enterprises of all sizes to achieve the many
benefits of B2B eCommerce without the burden of infrastructure
investment and ongoing content and system management.


ESTERLINE TECH: S&P Affirms BB Long-Term Corporate Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings, including
the 'BB' long-term corporate credit rating, on Esterline
Technologies Corp.

The outlook is stable.

"Although the pending debt-financed acquisition of CMC Electronics
Inc. [not rated] will result in a material deterioration in
Esterline's currently strong for the rating financial measures,
expected debt reduction should restore appropriate ratios in the
next 12 months," said Standard & Poor's credit analyst Christopher
DeNicolo.

However, the $335 million acquisition limits the company's
flexibility for further acquisitions until leverage is reduced.
The increased debt would result in Esterline's pro forma debt to
EBITDA rising to approximately 4.5x from 2.6x in fiscal 2006, with
a similar deterioration in other credit protection measures.

CMC designs and manufactures a range of electronics for aviation
applications including GPS, heads-up displays, enhanced vision
systems, electronic flight bags, and flight management systems.
The acquisition will improve Esterline's system integration
capabilities.

The ratings on Esterline reflect the company's exposure to the
competitive and cyclical commercial aerospace market, an active
acquisition program, and modest size compared with some
competitors, offset somewhat by a diversified revenue base and
acceptable profitability.

Bellevue, Washington-based Esterline designs and manufacturers
highly engineered products and systems for defense and aerospace
customers, as well as for general industrial applications.
Products include lighted switches and displays for commercial and
military aircraft, temperature and pressure sensors for engines,
and electronic countermeasures.  Revenues in recent years have
benefited from acquisitions, military sales, and the recovery in
the commercial aftermarket.  The Advanced Materials unit produces
high-performance silicone elastomer products, electronic warfare
countermeasure products, and combustible ordnance.  The company's
Sensors & Systems unit provides temperature and pressure sensors
for aircraft turbine engines, fluid regulation systems, and motion
control components.  Avionics & Controls produces technology
interface systems, lighted switches, displays and control products
for commercial and military aircraft.

Esterline's revenue base is fairly balanced between military,
commercial aerospace, and industrial markets.  The firm's products
are used on wide range of commercial and military airplanes, with
no one aircraft type accounting for more than 5% of revenues.
Firm backlog was $654 million as of Oct. 27, 2006.

A diversified revenue base and good growth in key markets should
enable Esterline to reduce debt with free cash flow and restore
leverage and other credit protection measures to more appropriate
levels.  The outlook could be revised to negative if leverage does
not decline as expected or there are further debt-financed
acquisitions.  It is unlikely the outlook will be revised
to positive in the intermediate term.


EXECUTE SPORTS: Sells Academy Snowboard Rights Back to Owners
-------------------------------------------------------------
Execute Sports Inc. has sold and transferred the Academy Snowboard
brand.  Deal points included the transfer of all liabilities,
current receivables and all rights to the brand back to the
original owners.

Execute Sports has decided to shut down the Academy Snowboards,
acquired in November 2006 as part of the Pacific Sports Group,
Inc. acquisition, after a year of disappointing sales and sub-
standard production.

"The sale of Academy was pivotal in the successful restructuring
of the company," Geno Apicella, CEO of Execute Sports, said.  "In
lieu of the situation, the best possible deal was made, reducing
Execute's outstanding debt while finding a perfect home for the
brand.  With the sale of Academy, Execute Sports will continue to
focus on its growing Watersports business.  Credit must be given
to Execute Sports' board members for completing this deal in a
swift and efficient manner.  Execute Sports could not be happier
with the final results and Execute Sports wish the brand and its
new owners a new-found success in the future."

                       About Execute Sports

Headquartered in San Clemente, California, Execute Sports, Inc.
(OTCBB:EXCS) -- http://www.executesports.com/-- markets and sells
water sports clothing, apparel, and motorcycle accessories.  On
March 3, 2005, the company changed its name from Padova
International U.S.A. Inc. to Execute Sports Inc.

                       Going Concern Doubt

As reported in the Troubled Company Reporter on June 5, 2006,
Bedinger & Company, in Concord, California, raised substantial
doubt about Execute Sports's ability to continue as a going
concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2005.  The auditor pointed
to the company's recurring losses from operations.


EXIDE TECH: Posts $11.2 Million Net Loss in Quarter Ended Dec. 31
-----------------------------------------------------------------
Exide Technologies Inc. reported an $11.2 million net loss on
$769.7 million of sales for the fiscal 2007 third quarter ended
Dec. 31, 2006, compared with a $27.7 million net loss on
$733.4 million of sales for the fiscal 2006 third quarter.
Excluding the favorable impact of currency, sales were essentially
flat year-over-year.

"The somewhat lower unit volumes in both our Transportation North
America and Transportation Europe and Rest of World businesses
continue to be the result of our intended program to increase
profitability," said Gordon Ulsh, President and CEO.  "An
unseasonably warm December on both continents put further downward
pressure on volume."

The fiscal 2007 third quarter net loss included an approximate
$9.2 million after-tax impairment charge relating to the company's
Nanterre, France former manufacturing facility held for sale.

The decreased net loss is partially the result of improved gross
margins driven by higher pricing and continued productivity gains,
which more than offset the impact of lower volumes.  Results for
the current quarter included a tax benefit of $2.9 million versus
a tax provision in the prior year period of $3.5 million.
Interest expense, net was $4.4 million higher in the current
quarter due to higher average debt levels and higher interest
rates.

At Dec. 31, 2006, the company's balance sheet showed $2.1 billion
in total assets, $1.8 billion in total liabilities, $14 million in
minority interest, and $299.5 million in total stockholders'
equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19b0

                      About Exide Technologies

Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and
distributes lead acid batteries and other related electrical
energy storage products.  The company filed for chapter 11
protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125).
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, represented the Debtors in their successful restructuring.
Exide's confirmed chapter 11 Plan took effect on May 5, 2004.  On
April 14, 2002, the Debtors listed $2,073,238,000 in assets and
$2,524,448,000 in debts.


FLEXTRONICS:  Earns $119 Million Net Income in Qtr Ended Dec. 31
----------------------------------------------------------------
Flextronics International Ltd. earned $119 million of net income
on $5.4 billion of net sales for the third quarter ended Dec. 31,
2006, compared with $42 million of net income on $4.1 billion of
net sales for the same period ended Dec. 31, 2005.

Net sales increased $1.3 billion due to new program wins from
various customers.

Gross profit during the quarter ended Dec. 31, 2006, increased
$115.6 million to $289.1 million, or 5.3% of net sales, from
$173.5 million, or 4.2% of net sales, during the quarter ended
Dec. 31, 2005.

Fiscal 2006 third quarter cost of sales included $63.1 million in
restructuring charges related to the impairment, lease
termination, exit costs and other charges related to the disposal
and exist of certain real estate owned and leased by the company.
The company did not incur any restructuring charges in the fiscal
2007 quarter.

Selling, general and administrative expenses amounted to
$135.9 million, or 2.5% of net sales, during the quarter ended
Dec. 31, 2006, compared to $96.2 million, or 2.4% of net sales,
during the quarter ended Dec. 31, 2005.

During the quarter ended Dec. 31, 2005, the company recognized
$7.7 million of charges related to the retirement of Michael E.
Marks from his position as Chief Executive Officer, of which
approximately $5.9 million was paid during the quarter, and the
remaining amount was paid in July 2006.

Interest and other expense, net was $16.8 million during the
quarter ended Dec. 31, 2006, compared to $21.9 million during the
quarter ended Dec. 31, 2005, a decrease of $5.1 million.

Income from continuing operations was $118.6 million in the
current quarter compared to $37.6 million in the previous quarter.
The fiscal 2005 quarter income from continuing operations included
an approximate $12.2 million benefit reduction in previously
recorded valuation allowances for deferred tax assets, and
$4.3 million income from discontinued operations related to the
divestiture of the software development and solutions business in
September 2006.

At Dec. 31, 2006, the company's balance sheet showed $12.7 billion
in total assets, $5.6 billion in total liabilities, and
$6.1 billion in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19b3

               Sale of Software Development Business

In September 2006, the company completed the sale of its software
development and solutions business to Software Development Group,
nka Aricent, an affiliate of Kohlberg Kravis Roberts & Co.  The
company received aggregate cash payments of approximately
$688.5 million, an eight-year $250 million face value promissory
note with a paid-in-kind interest coupon fair valued at
approximately $204.9 million and retained a 15% ownership interest
in Aricent, fair valued at approximately $57.1 million.

                         Acquisition of IDW

On Nov. 30, 2006, the company completed its acquisition of 100% of
the outstanding common stock of IDW, a manufacturer and designer
of high quality liquid crystal displays, modules and assemblies,
in a stock-for-stock merger.

The aggregate purchase price was approximately $299.6 million.

                         Liquidity Position

As of Dec. 31, 2006, the company had cash and cash equivalents of
$909.2 million and bank and other borrowings of $1.5 billion.

                        About Flextronics

Headquartered in Singapore, Flextronics International Ltd.
(NasdaqGS: FLEX) -- http://www.flextronics.com/-- provides
complete design, engineering and manufacturing services to
automotive, computing, consumer digital, industrial,
infrastructure, medical and mobile OEMs.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 7, 2007,
Moody's Investors Service revised the outlook on Flextronics
International Ltd. to stable from negative, while affirming its
corporate family rating to Ba1.


FLOWSERVE CORP: Fitch Rates Senior Secured Bank Facilities at BB
----------------------------------------------------------------
Fitch Ratings has initiated coverage of Flowserve Corporation and
assigned these ratings:

--Issuer Default Rating 'BB';
--Senior secured bank facilities 'BB';

The Rating Outlook is Stable.

Flowserve had slightly more than $650 million of debt outstanding
at Sept. 30, 2006.

The ratings incorporate Flowserve's product and geographic
diversification within the flow control industry, its leading
market positions, and strong demand across many of its end
markets.  Other rating strengths include a conservative debt
structure, ample liquidity and declining leverage.  The company
has consistently reduced debt over the past several years, and
segment operating income has also been improving.  Rating concerns
include weak controls over financial reporting, a number of
potential litigation liabilities, further rationalization required
in the company's management information systems, and cyclicality
in many of Flowserve's end-markets.  Concerns about cyclicality
are mitigated by the substantial portion of aftermarket business,
long term growth in international markets which represent more
than half of total revenue, and a favorable outlook for long term
investment in the oil and gas industries.  Much of the senior
management team has been replaced since early 2004, and the
company is gradually consolidating its and management information
systems.

Increases in bookings and revenue from the important oil, gas and
process industries have contributed to improving operating results
despite a number of ongoing challenges involving financial
controls and potential litigation liabilities.  Fitch anticipates
that as Flowserve eventually resolves these issues, the company's
financial profile could improve further.  SEC filings were brought
current as of Sept. 30, 2006 but the company is still addressing
material weaknesses as disclosed in its financial statements. The
challenges surrounding Flowserve's financial controls and
management information systems follow a period of acquisitions and
mergers several years ago under a previous management team.  The
company is currently taking steps to boost its accounting and
compliance capabilities and has implemented a program to gradually
upgrade and integrate the large number of disparate information
systems currently in place.  The completion of this effort will be
important to Flowserve's ability to implement operating
strategies, maintain its competitive position and control costs
related to financial reporting.

Potential litigation liabilities represent additional rating
concerns, including asbestos, shareholder lawsuits, export control
laws, and investigations of Flowserve's compliance with the U.N.
Oil-for-Food Program.  These potential liabilities are reduced by
insurance coverage.  While the effectiveness of such coverage is
difficult to ascertain, the ratings incorporate Fitch's view that,
in the absence of unexpectedly large awards against it,
Flowserve's net litigation liabilities are not likely to result in
a substantial use of cash.

Improved results through the first nine months of 2006 benefited
by comparison with 2005 when Flowserve recorded certain
non-recurring costs.  These costs included the extinguishment of
debt as well as losses from the General Services Group that was
divested in 2005.  Stronger operating results have been partly
offset by high professional fees as Flowserve addresses its
financial control weaknesses and upgrades its finance and
compliance capabilities.  Operating margins have improved in
recent periods, rising modestly to 7.8% for the first nine months
of 2006.  They can be expected to improve further when
professional fees eventually decline and as Flowserve increases
sourcing from low-cost locations and takes other steps to control
costs.  Flowserve's long term target for operating margins is 15%.

The company has used most of its free cash flow in recent years to
reduce debt and leverage.  At Sept. 30, 2006, Flowserve had
reduced debt/EBITDA to 2.24x compared to levels above 4x prior to
2004.  Going forward, however, improving operating trends and cash
flow should support discretionary spending for potential
acquisitions and share repurchases.  Share repurchases were
recently implemented partly to offset the impact of employee stock
option plans that were unexercisable while SEC filings were
delinquent.  Despite the increase in Flowserve's discretionary
spending, Fitch believes the company is likely to maintain
leverage near current levels over the long term and could
potentially report stronger financial measures in the absence of
acquisition opportunities.

Debt at Sept. 30, 2006 totaled $654 million, consisting primarily
of a $562 million term loan under its domestic credit facilities
and an $85 million borrowing from the European Investment Bank.
The EIB borrowing, which was backed by a letter of credit issued
under a $400 million domestic bank revolving credit, was repaid in
December 2006.  Liquidity was supported by $52 million of cash and
the $400 million revolver.  Flowserve's domestic bank facilities
are secured by substantially all of its domestic assets and 65% of
the capital stock of certain foreign subsidiaries.  The facilities
contain a comprehensive set of covenants that were put in place
while the company was delinquent on its SEC filings, and the
company was well within its covenant limits at Sept. 30, 2006.
The bank revolver and term loan mature in 2010 and 2012,
respectively, and would become unsecured if Flowserve maintains
investment grade ratings, as defined in the agreement, for at
least 90 days.


FOAMEX INT'L: Emerges from Chapter 11 Bankruptcy Protection
-----------------------------------------------------------
The Plan of Reorganization of Foamex International Inc. has become
effective and the company has successfully emerged from chapter 11
bankruptcy protection.

In accordance with the Plan, holders of allowed claims will be
satisfied in full in cash.  Additionally, the company's
equityholders will retain their interests in Foamex, subject to
dilution as a result of the issuance of additional common stock in
connection with the rights offering, the call option and any
common stock to be issued under the proposed Management Incentive
Plan and the existing Key Employee Retention Program or upon
exercise of any stock options.  Foamex has begun to make the
initial distributions required under the Plan, and expects to
finish making all distributions required to be made on or about
the effective date by Feb. 15, 2007.

                    New Executive Management

The company also disclosed that Mr. Gregory J. Christian, who had
been Executive Vice President, Chief Restructuring Officer, Chief
Administrative Officer, and General Counsel of Foamex, has been
named President of the company, effective immediately.  Mr.
Christian, who joined the company in 1996, will also continue to
serve on the company's Board of Directors.

"This is an extraordinary day for Foamex," Raymond E. Mabus,
Chairman and Chief Executive Officer of Foamex, said.  "It marks
the close of one of the most challenging times in the history of
the company, and more importantly, it is the beginning of a new
era.  Foamex is emerging as a stronger, leaner company, with a
reinvigorated business and the financial flexibility needed to
compete and be the industry leader.  We have worked diligently
with our employees, advisors and stakeholders to reach this point.

"Central to our turnaround has been our efforts to transform the
business from a traditional foam manufacturer to a market-focused
provider of polyurethane foam-based solutions and specialty
comfort products. Innovation is the cornerstone of our future.  We
are partnering with our customers to develop specialty solutions
for diverse markets, while still continuing to be a full service
provider of high quality products to the traditional markets we
serve.  We believe that executing this strategy, coupled with
discipline, hard work and operational excellence will ensure our
future success.

"Emerging from chapter 11 is extremely gratifying. I am pleased to
say that the results of our restructuring process exceeded
everyone's expectations -- a true testament to the hard work of
our employees, our restructuring team, and all of our
stakeholders.  Our situation is highly unusual in that all of
Foamex's creditors will be paid in full in cash, and our
equityholders will have the opportunity to retain their interests
in Foamex.  Today's news, combined with our operational
performance, provides strong evidence that we have good momentum
and a promising future.

"Additionally, I would like to congratulate Greg on his well-
deserved promotion to President of Foamex.  This is truly a
testament to the invaluable contributions he has made to the
Company and the central role he played in the reorganization
process.  We look forward to his many contributions in the years
ahead in this new capacity.

"I would also like to express thanks to Andy Thompson, Executive
Vice President of Foam and Technical Products, and Don Phillips,
Executive Vice President of Automotive Products.  With Greg, they
have been instrumental in effectuating Foamex's turnaround and the
Company's strategic shift.  As I've said, Foamex has a bright
future and I look forward to working with these three leaders and
the rest of our talented employees as we take Foamex to the next
level."

With the company's emergence from bankruptcy, Foamex has a new
seven-member board of directors.  The members are Messrs. Mabus
and Christian; Mr. Thomas M. Hudgins, retired Partner, Ernst &
Young LLP; Mr. Robert B. Burke, Founder and Chief Executive
Officer of Par IV Capital Management, LLC; Mr. Seth Charnow of the
D. E. Shaw Group; Mr. Eugene I. Davis, Chairman and Chief
Executive Officer of PIRINATE Consulting Group, LLC; and Gregory
E. Poling, President of Grace Davison Chemicals, an operating
segment of W.R. Grace & Co., and Vice President of W.R. Grace &
Co.

Headquartered in Linwood, Pennsylvania, Foamex International Inc.
(FMXIQ.PK) -- 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.  On Feb. 2, 2007,
the Court confirmed the Debtors' Second Amended Joint Plan of
Reorganization.


FULTON STREET: Fitch Cuts Rating on $5.9 Mil Class C Notes to B-
----------------------------------------------------------------
Fitch has affirmed five classes and downgraded one class of notes
issued by Fulton Street CDO, Ltd. and its co-issuer Fulton Street
CDO Funding Corp.

These rating actions are effective immediately:

   -- $169,522,174 class A-1A notes affirmed at 'AAA';

   -- $139,384,899 class A-1B notes affirmed at 'AAA';

   -- $34,000,000 class A-2 notes affirmed at 'AA';

   -- $9,186,975 class B-1 notes affirmed at 'BBB';

   -- $10,207,000 class B-2 notes affirmed at 'BBB'; and

   -- $5,982,979 class C notes downgraded to 'B-/DR1' from
      'B/DR1'.

Fulton is a collateralized debt obligation that closed March 27,
2002 and is managed by Clinton Group, Inc. Fulton ended its
revolving period on April 20, 2006.  The collateral supporting the
CDO is composed of a diversified portfolio of residential
mortgage-backed securities, commercial mortgage-backed securities,
asset-backed securities, corporate debt securities, and
collateralized debt obligations.

The downgrade to the class C notes is the result of declining
performance measures, such as overcollateralization ratios and
weighted average coupon.  According to the most recent trustee
report dated Jan. 16, 2007, class C OC test continues to fail,
99.4% versus a trigger of 100%.  The WAC has decreased to 7.61%
with respect to a minimum covenant of 7.65%.  The class C notes
have deferred interest the past two payment periods.  Over that
time, the notional balance on the class C notes has increased by
approximately $354,109.

The affirmations to the class A-1, A-2 and B notes are due to
positive structural features which have caused the senior notes to
delever.  The failure of the B OC test, 100.9% versus a trigger of
101%, causes available interest proceeds to be used to delever the
senior notes.  Prior to April 2014, available principal
collections can be used to pay unpaid class B interest, which aids
the B notes in certain scenarios.  Fitch believes that the
structural features in the deal and portfolio composition warrant
the affirmation of the ratings of the class A-1, A-2 and B notes.

The ratings on the class A-1A, A-1B and A-2 notes address the
timely payment of interest and principal; the ratings on the class
B-1, B-2 and C notes address the ultimate payment of interest and
principal.  The class A-1A and A-1B notes have a legal final
maturity of April 2032; the class A-2, B-1, B-2, and C notes have
a legal final maturity of April 2037.

Fitch will continue to monitor and review this transaction for
future rating adjustments.


FUNCTIONAL RESTORATION: Trustee Wants Grobstein as Accountants
--------------------------------------------------------------
David K. Gottlieb, the Chapter 11 Trustee for Functional
Restoration Medical Center Inc.'s bankruptcy case, asks the
U.S Bankruptcy Court for the Central District of California for
permission to employ Grobstein, Horwath & Company LLP as his
accountants.

The firm will:

     a. investigate and analyze transfers made to or on behalf of
        insiders;

     b. investigate and analyze potential preference payments made
        within 90 days of the Debtor's bankruptcy filing;

     c. provide litigation support to the extent support is
        appropriate and required;

     d) investigate for potential fraudulent transfers;

     e) accounting services relative to record reconstruction and
        tax return preparation;

     f) assist the trustee in analyzing the financial condition of
        the Debtor and preparation of necessary projections and
        forecasts;

     g) provide forensic accounting support as necessary; and

     h) provide accounting support as may be required.

Alan L. Kahn, CPA of the firm, assures the Court that the firm is
a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.

A list of the firm's professionals billing rates is available for
free at http://ResearchArchives.com/t/s?19b9

Mr. Kan can be reached at:

     Alan L. Kahn, CPA
     Grobstein, Horwarth & Company LLP
     15233 Ventura Blvd., 9th Floor
     Sherman Oaks, CA 91403
     Tel: (818) 501-5200
     Fax: (818) 501-7040

Headquartered in Encino, California, Functional Restoration
Medical Center, Inc., is the second largest owner and operator
of MRI centers in Southern California.  The Debtor filed for
chapter 11 protection on Mar. 9, 2006 (Bankr. C.D. Calif. Case No.
06-10306).  Daniel A. Lev, Esq., at SulmeyerKupetz, represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, its estimated assets and debts
between $10 million and $50 million.


GEOEYE INC: Pays $50 Million Loan Used to Acquire Space Imaging
---------------------------------------------------------------
GeoEye Inc. disclosed the final payment on a $50 million credit
facility that it drew down in January 2006 to fund the acquisition
of the assets of Colorado-based Space Imaging.  While the two and
one-half year facility did not have an amortization repayment
schedule, it was structured to be repaid from excess cash flow
generated by the assets purchased from Space Imaging.  Given the
performance of the operation, the company has been able to repay
this facility with cash flow generated within calendar year 2006.
In conjunction with this repayment, the preferred stock that was
issued in connection with the loan will be cancelled.

"Our board of directors and executive team are very pleased that
the company's and our employees' performance have enabled us to
repay this loan in such a short period of time -- just about a
year after the completion of the Space Imaging acquisition," Matt
O'Connell, GeoEye's president and chief executive officer, said.

"After completing the Nasdaq listing last fall and repaying this
debt, the company is now positioned to seek new opportunities and
growth," Henry Dubois, GeoEye's executive vice president and chief
financial officer, stated.

"The integration of Space Imaging is complete and the team is now
in place across all of our operational locations to support
GeoEye-1 when launched later this year," Bill Schuster, GeoEye's
chief operating officer, said.  "The IKONOS satellite, its 255
million square kilometer archive, and, most importantly, the top-
notch employees were a terrific investment from which we continue
to find value."

                          About GeoEye

Headquartered in Dulles, Virginia, GeoEye (Nasdaq: GEOY) --
http://www.geoeye.com/-- is a commercial imaging satellites
operator.  GeoEye was a result of ORBIMAGE's acquisition of Space
Imaging in January 2006.  The company provides geospatial data,
information and value-added products for the national security
community, strategic partners, resellers and commercial customers.
GeoEye operates three Earth imaging satellites: OrbView-2,
OrbView-3 and IKONOS and possesses a network of regional ground
stations, a robust image archive, and geospatial imagery
processing capabilities.

                          *     *     *

Geoeye Inc.'s 14.8668% Senior Secured Floating Rate Notes due 2012
carry Standard & Poor's B- rating.


GLOBAL POWER: Has Until April 26 to File Chapter 11 Plan
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave Global
Power Equipment Group Inc. and its debtor-affiliates until
April 16, 2007, to file their plan of reorganization and until
June 25, 2007, to solicit acceptances of that plan.

The Debtors' exclusive period to file a chapter 11 plan expired on
Jan. 26, 2007.

Although much has been achieved in terms of transitioning their
business into Chapter 11 administration, the Debtors note that a
substantial amount of work remains to be done before they will be
able to propose a plan consistent with their fiduciary duties to
maximize value, including the development and testing of a
business plan and an analysis of the Debtors' intercompany claims.

Until a reliable business plan can be developed, vetted and
validated, coupled with an analysis of intercompany issues,
efforts to propose and file a plan of reorganization will be
futile, the Debtors said.

Headquartered in Tulsa, Oklahoma, Global Power Equipment Group
Inc. aka GEEG Inc. -- http://www.globalpower.com/-- provides
power generation equipment and maintenance services for its
customers in the domestic and international energy, power and
infrastructure and service industries.  The Company designs,
engineers and manufactures a range of heat recovery and auxiliary
equipment primarily used to enhance the efficiency and facilitate
the operation of gas turbine power plants as well as for other
industrial and power-related applications.  The Company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.

The Company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A., represent
the Debtors.  The Official Committee of Unsecured Creditors
appointed in the Debtors' cases has selected Landis Rath & Cobb
LLP as its counsel.  As of Sept. 30, 2005, the Debtors reported
total assets of $381,131,000 and total debts of $123,221,000.


GLOBAL TEL*LINK: Moody's Holds Corporate Family Rating at B1
------------------------------------------------------------
Moody's Investors Service affirmed Global Tel*Link Corporation's
B1 corporate family and senior secured ratings following the
company's report of its intention to increase the size of its term
facility by a further $10 million and distribute the additional
proceeds to shareholders.

The ratings reflect a B2 probability of default and loss given
default assessment of LGD 3, 31% for the senior secured bank debt.

The outlook is stable.

While the incremental debt proceeds will increase GTEL's initial
adjusted leverage to roughly 4.4x, the ratings have been affirmed
because the increase in leverage is only modest and Moody's
expects this metric to reduce to roughly 4x by the end of 2008,
albeit primarily through earnings improvement rather than absolute
debt reduction.

Moody's notes, however, that GTEL's ability to withstand any
unexpected operational challenges within its B1 rating through the
next couple of years is now limited.

Ratings Affirmed at B1 LGD 3, 31%:

   -- $20 million senior secured revolver due 2012

   -- $120 million senior secured term loan due 2013

   -- $50 million senior secured delayed draw term loan due 2013

   -- $10 million senior secured synthetic L/C facility due 2013

   - $40 million senior secured delayed draw synthetic L/C
     facility due 2013

Global Tel*Link Corporation, based in Mobile, Alabama, is majority
owned by The Gores Group, LLC and provides telecommunications
services to correctional facilities.


GNC CORP: Possible Company Sale Cues S&P's Negative CreditWatch
--------------------------------------------------------------
Standard & Poor's Ratings Services' ratings on General Nutrition
Centers Inc., including the 'B' corporate credit rating, remain on
CreditWatch with negative implications, where they were placed on
Dec. 22, 2006 following the company's report that it was no longer
contemplating a public offering, but that it would continue to
evaluate strategic alternatives, including a possible sale of the
company that would be financed with a substantial amount of
additional debt.

"On Feb. 9, 2007, Ares Management LLC and the Ontario Teachers'
Pension Plan announced that they had signed a definitive agreement
to acquire GNC Parent Corp., the parent company of GNC, from
Apollo Management, L.P.," explained Standard & Poor's credit
analyst Jackie Oberoi.

"GNC's enterprise value is estimated at $1.65 billion for this
transaction."

The ratings on Pittsburgh, Pennsylvania-based GNC reflect a highly
leveraged capital structure, with total lease-adjusted debt pro
forma for the company's recent pay-in-kind note issuance of about
6.8x.

Standard & Poor's will continue to monitor developments related to
GNC's sale.


GRANT FOREST: S&P Cuts Long-Term Corporate Credit Rating to 'B+'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on Grant Forest Products Inc. to 'B+' from 'BB'.

The outlook is negative.

The downgrade stems from a sharp increase in the company's cash
burn, as EBITDA has turned negative amid very weak oriented strand
board prices, while capital expenditures for two new OSB mills
have increased because of higher-than-expected labor, concrete,
and steel costs.

Consequently, the company is compelled to raise additional debt of
$125 million to preserve liquidity through the completion of the
new mills.  Grant's operating income declined sharply during 2006,
and is expected to remain at very weak levels during 2007 in light
of weak OSB pricing conditions.

Nevertheless, the improved liquidity should help moderate further
deterioration of its credit risk during the current industry
downturn.

The rating reflects:

   (a) the company's high debt leverage;

   (b) narrow product focus in OSB, a plywood substitute; and

   (c) volatile earnings and cash flow.

These factors are partially offset by the company's good fiber
integration and its modern, cost-efficient facilities.

"Grant faces increased medium-term credit risk from the
substantially debt-financed construction of two large OSB mills,
although these new mills will improve the company's cost profile
and operating diversity, and will mitigate its foreign exchange
exposure," said Standard & Poor's credit analyst Donald Marleau.

The company has traditionally maintained a moderate capital
structure, quickly repaying debt incurred to fund its
growth capital expenditures.

Grant's liquidity is weak pending the completion of its
$125 million financing.  Although the company currently has
$26 million in cash and about $159 million available under its
first-lien credit facility, the combination of minimal EBITDA
generation in the coming quarters and more than $130 million of
capital expenditures in 2007 will cause a rapid drain on its cash
resources.  Absent a further operating cash drain or capital cost
overruns, the addition of $125 million of liquidity should enable
the company to complete its growth capital expenditures in 2007.

The outlook is negative.

Persistently low OSB prices and the consequent weak cash flow,
combined with the company's large capital expenditures will
consume considerable liquidity through 2007.  Nevertheless, the
rating is supported by committed credit facilities to construct
the two new, low-cost OSB mills.  If industry conditions remain
weak for a protracted period or if capital expenditures increase
unexpectedly again, either of which contributes to materially
higher debt or weaker liquidity, the rating could be lowered.

Grant has a good track record of reducing debt on completion of
its growth capital expenditures, and Standard & Poor's expects
that the company will return to a moderate financial profile after
the Allendale and Clarendon mills are complete, and will benefit
significantly from the new assets.


GSAMP TRUST: Moody's Rates Class B-2 Certificates at Ba2
--------------------------------------------------------
Moody's Investors Service has assigned a rating of Aaa to the
senior certificates issued by GSAMP Trust 2007-FM1, and ratings
ranging from Aa1 to Ba2 to the mezzanine and subordinate
certificates in the transaction.

The securitization is backed by adjustable and fixed rate,
subprime residential mortgage loans.  The ratings are based
primarily on the credit quality of the loans, and on the
protection from subordination, overcollateralization, excess
spread, and interest rate swap and interest rate cap agreements
between the trust and Goldman Sachs Mitsui Marine Derivatives
Products, L.P.

Moody's expects collateral losses to range from 5.25% to 5.75%.

Fremont Investment & Loan will service the loans and Wells Fargo
Bank, N.A. will act as master servicer.  Moody's has assigned
Fremont Investment & Loan its servicer quality rating of SQ3+ as
primary servicer of subprime residential mortgage loans.
Furthermore, Moody's has assigned Wells Fargo Bank, N.A. its top
servicer quality rating of SQ1 as master servicer of residential
mortgage loans.

These are the rating actions:

GSAMP Trust 2007-FM1

Mortgage Pass Through Certificates, Series 2007-FM1

                       Class A-1, Assigned Aaa
                       Class A-2A, Assigned Aaa
                       Class A-2B, Assigned Aaa
                       Class A-2C, Assigned Aaa
                       Class A-2D, Assigned Aaa
                       Class M-1, Assigned Aa1
                       Class M-2, Assigned Aa2
                       Class M-3, Assigned Aa3
                       Class M-4, Assigned A1
                       Class M-5, Assigned A2
                       Class M-6, Assigned A3
                       Class M-7, Assigned Baa1
                       Class M-8, Assigned Baa2
                       Class M-9, Assigned Baa2
                       Class B-1, Assigned Ba1
                       Class B-2, Assigned Ba2


GSC PARTNERS: Moody's May Upgrade Ba3 Rating on $10MM Cl. B Notes
-----------------------------------------------------------------
Moody's Investors Service placed on watch for possible upgrade the
rating on the notes issued in 2001 by GSC Partners CDO Fund II,
Limited, a high yield collateral bond obligation issuer:

   * The $10,000,000 Class B Floating Rate Subordinated Notes Due
     2013

      -- Prior Rating: Ba3
      -- Current Rating: Ba3, on watch for possible upgrade

The rating action reflects the significant delevering of the
transaction, according to Moody's.


GSMSC NET: Moody's Puts Low-B Ratings on Class N3 and N4 Notes
--------------------------------------------------------------
Moody's Investors Service has assigned ratings ranging from A3 to
B3 to the GSMSC Net Interest Margin Securities, Series 2007-NIM1.
The notes are backed primarily by a 92% interest in the Class X-1
and Class P certificates issued by GSR Mortgage Loan Trust 2006-
OA1, a securitization of first lien, adjustable rate residential
mortgage loans with a negative amortization feature.

The cash flows available to repay the notes are most significantly
impacted by the level of prepayments, as well as the timing and
the amount of losses on the underlying mortgage pool.

Moody's applied various combinations of loss and prepayment
scenarios to evaluate the cash flows to the rated notes.

These are the rating actions:

   * GSMSC 2007-NIM1, LTD

   * GSMSC Net Interest Margin Securities, Series 2007-NIM1

      -- Class N1, Assigned A3
      -- Class N2, Assigned Baa3
      -- Class N3, Assigned Ba3
      -- Class N4, Assigned B3


HERTZ CORP: Additional Debt Cues S&P's BB- Corporate Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its bank loan and
recovery ratings on Hertz Corp.'s senior secured bank facility,
following the report that the company will increase its first-lien
ABL facility to $1.8 billion from $1.6 billion and apply
approximately $550 million of the ABL to repay term loan
borrowings.

Pro forma for the increase, the facility will consist of the
$1.8 billion ABL due 2012 maturity, extended from the previous
2010 maturity; and approximately $1.4 billion outstanding on the
term loan and a $250 million synthetic letter-of-credit facility,
both due 2010.

All facilities were also amended to reflect improved pricing.
The ABL is rated 'BB+', two notches above Hertz Corp.'s corporate
credit rating and the term loan and synthetic letter-of-credit
facilities are rated 'BB', one notch above the corporate credit
rating.  Each of the facilities has a recovery rating of '1',
indicating a high expectation of full recovery of principal in
the event of payment default.

Rating List:

   * Hertz Corp.

      -- Corporate Credit Rating, BB-/Negative/

Rating Affirmed:

   * Hertz Corp.

      -- Senior Secured Bank Facility affirmed at BB+/BB
      -- Recovery Rating: 1


IFM COLONIAL: S&P Places Corporate Credit Rating at 'BB+'
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' corporate
credit rating to IFM Colonial Pipeline 2 LLC, a domestic
subsidiary of Australian-based Industry Funds Management.

Standard & Poor's also assigned a 'BBB-' rating to IFM Holdco's
$225 million senior secured credit facility.  In addition, the
facility was also assigned a '1' recovery rating, indicating the
expectation of full recovery of principal in a default scenario.
Driven primarily by Standard & Poor's recovery rating, the senior
secured rating is one notch above the corporate credit rating.

The outlook is stable.

IFM Holdco intends to use the proceeds from the $225 million
senior secured facility along with $424 million of equity to
purchase a 15.8% equity interest in Colonial Pipeline Co. from
CITGO Petroleum Corp.

IFM Holdco has a satisfactory business profile and an aggressive
financial profile.  Ratings are buoyed by the strong business
profile of Colonial, a unique refined products pipeline which
accesses 13 major refineries in the Gulf Coast and terminates in
end markets representing about 15% of the U.S. population.

Absent any major operational difficulties, which are considered
remote risks, the ratings will likely remain stable for the
foreseeable future.  Expansion projects appropriately supported
with long-term contracts with creditworthy shippers and that do
not materially alter balance sheet fundamentals are reflected in
the rating.

"Rating or outlook improvement is unlikely, unless financial
policy is significantly changed," said Standard & Poor's credit
analyst Charles J. LaPorta.

"Downward ratings or outlook changes could be precipitated by
operational problems that could persist, or if corporate strategy
was shifted to introduce new business or financial risks into
Colonial's credit profile," he continued.


JUNIPER NETWORKS: Stock Options Probe Cues S&P's Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services' BB/Watch Neg/B-1 corporate
credit and other ratings on Sunnyvale, California-based Juniper
Networks Inc. remain on CreditWatch with negative implications,
where they were placed on May 22, 2006.

"The CreditWatch placement followed Juniper's announcement that it
had received a request for information from the office of the
U. S. Attorney for the Eastern District of New York relating to
the company's granting of stock options," said Standard & Poor's
credit analyst Bruce Hyman.

On Dec. 20, 2006, the company reported the completion of the
independent investigation in that matter.

The investigation found:

   (a) numerous instances in which grant dates were chosen to give
       favorable prices;

   (b) serious concerns regarding certain former management; and,

   (c) insufficient exercise of responsibility by management for
       the stock option process.

The company expects to file its June and September 2006 forms 10-Q
during the first quarter of 2007; additionally the company has
been notified that continued NASDAQ listing will require it to
file those documents by February 12, 2007.  The ratings will
remain on CreditWatch until the company is in compliance with all
listing requirements and has timely filed all required financial
statements, and an assessment of the longer-term effect of its
stock options disclosures can be made.

Juniper's substantial liquidity should provide sufficient
resources for R&D and administrative expenses, strategic
investments and working capital, and also cushion the downside
risk to the rating.

The ratings continue to reflect the company's broadening business
base, continued good market position in the networking equipment
and information security markets, and its moderate financial
profile, tempered by the challenges of rapid growth in a highly
competitive, rapidly evolving market, and the potential for
continued industry volatility. Juniper supplies high-performance
routers and network security products, used in carrier and
enterprise networks, competing against industry leader Cisco
Systems Inc. and others.  The company has distribution
arrangements with Alcatel Lucent, Ericsson, Siemens AG, and Avaya
Inc. Ericsson's planned acquisition of Redback Systems Inc. could
reduce Juniper's sales through that channel over time.  Juniper's
sales were $596 million in the December quarter, up 4%
sequentially, while full-year sales of $2.3 billion were up 12%
from 2005.


KYPHON INC: Moody's Lifts B1 Rating on $300 Mil. Senior Revolver
----------------------------------------------------------------
Moody's Investors Service upgraded the rating of Kyphon Inc.'s
$300 million senior secured revolver to Ba1 from B1 following the
issuance of $400 million in convertible senior unsecured notes.

Kyphon will use the proceeds from the notes and borrowings under
its revolving credit facility to pay down its $425 million senior
secured term loan.

Moody's will withdraw the rating for the senior secured term loan
when it is paid.

Under the new capital structure, the senior secured revolver
benefits from the increased support provided by the newly issued
convertible notes.

The ratings outlook is stable.

Moody's affirmed these ratings:

   -- Corporate Family Rating, B1, but changed the LGD assessment
      to LGD4, 50%, from LGD3, 35%; and,

   -- Speculative Grade Liquidity Rating, SGL-1.

Moody's upgraded these ratings:

   -- $300 million Revolving Credit Facility, to Ba1, LGD2, 15%
      from B1, LGD3, 34%; and

   -- Probability of Default Rating, to B1from B2.

Kyphon develops and markets medical devices designed to restore
spinal function and diagnose low back pain using minimally
invasive technologies.  The company's products are used in balloon
kyphoplasty for the treatment of spinal fractures caused by
osteoporosis or cancer, and in the Functional Anaesthetic
Discography procedure for diagnosing low back pain due to
degenerative disc disease.  The company has expanded into lumbar
spinal stenosis treatment following their recent acquisition of
St. Francis.  The company reported about $407.8 million of
revenues for the year ended Dec. 31, 2006.


LAIDLAW INTERNATIONAL: FirstGroup To Purchase Shares for $3.6 Bil.
------------------------------------------------------------------
Laidlaw International Inc. has entered into a merger agreement
with FirstGroup PLC under which FirstGroup will acquire all of
the outstanding common shares of the company in an all cash
transaction valued at approximately $3.6 billion, including the
assumption of $800 million of debt.

Under the terms of the agreement, the company shareholders will
receive $35.25 for each outstanding share of the company common
stock.  The transaction has been approved by the Board of
directors of Laidlaw International, which has agreed to recommend
to Laidlaw stockholders that they vote in favor of the
transaction.

The merger is conditioned upon approval by the stockholders of
both the company and FirstGroup and certain regulatory approvals,
as well as other customary closing conditions.

"Our goal for the past four years has been to develop, demonstrate
and deliver shareholder value" Kevin Benson, President and Chief
Executive Officer of Laidlaw International, said.  "We believe
this transaction is the epitome of that goal and represents an
excellent opportunity for both companies' employees and
shareholders.  The combination of the company and FirstGroup will
bring together well known brands and well respected companies that
share a very strong focus on employee and customer satisfaction.
It will provide a sound economic and operational base from which
to continue many of the efficiency initiatives that we have
underway."

"FirstGroup's acquisition of the company will considerably
enhance FirstGroup's existing activities in North America, which
themselves have grown strongly since we first invested in the U.S.
in 1999" Moir Lockhead, Chief Executive of FirstGroup, added.
"The improved earnings and strong cash flows arising from the
acquisition will strengthen the Group's position.  FirstGroup aims
to be the leader in delivering safe, reliable, innovative and
sustainable transport services.  The company is an established,
well run company that shares our commitment to safety and
delivering high quality services to our customers and communities
we serve."

                    About Laidlaw International

Headquartered in Arlington, Texas, Laidlaw International, Inc.
(NYSE:LI) -- http://www.laidlaw.com/-- is the largest school bus
operator in the United States and Canada, providing student
transportation services to more than a thousand school districts,
operating a fleet of approximately 41,000 buses.  The company
transports approximately two million students each school day to
and from school.  Laidlaw filed for chapter 11 protection on June
28, 2001 (Bankr. W.D.N.Y. Case No. 01-14099).  Garry M. Graber,
Esq., at Hodgson Russ LLP, represented the Debtors.  Laidlaw
International emerged from bankruptcy on June 23, 2003.


LAIDLAW INT'L: Merger Does Not Affect Low-B Ratings, Moody's Says
-----------------------------------------------------------------
Moody's Investors Service reported that the acquisition of Laidlaw
International Inc. by First Group plc does not, at this time,
affect Moody's ratings of Laidlaw:

   -- Corporate Family of Ba2
   -- senior secured of Ba1,
   -- senior unsecured of B1
   -- Speculative Grade Liquidity of SGL-2

The outlook is outlook.

The transaction contemplates the acquisition of Laidlaw by First
Group for cash consideration of $3.6 billion.

The disclosure by First Group indicates that the existing debt of
Laidlaw of approximately $800 million will be repaid from the cash
consideration upon the closing of the sale.  If so, Moody's will
withdraw the ratings of the debt repaid at such time.

Moody's also notes that a change of control of Laidlaw is an event
of default pursuant to the terms of the existing Credit Agreement,
which supports the expectation that the existing credit facilities
will be repaid upon closing of the transaction.  However, if the
credit facilities are not repaid or the remainder of the 10.75%
unsecured notes due 2011 are not redeemed, Moody's will consider
the treatment of the instruments in the resulting capital
structure and the nature of the support, if any.  The completion
of the transaction is subject to approvals from the shareholders
of both companies and from regulatory authorities.

Laidlaw International, Inc., headquartered in Naperville,
Illinois, is the leading provider of outsourced school bus
services in the US and Canada; and the 100% owner of Greyhound
Inc., North America's largest provider of inter-city passenger bus
services.  Laidlaw also provides para-transit services to many
U.S. municipalities through its public transit segment.


LB-UBS: Moody's Holds Junk Rating on $4.9 Million Class N Certs.
----------------------------------------------------------------
Moody's Investors Service upgraded the rating of one class and
affirmed the ratings of 14 classes of LB-UBS Commercial Mortgage
Trust 2000-C4, Commercial Mortgage Pass-Through Certificates,
Series 2000-C4:

   -- Class A-1, 16,281,596, Fixed, affirmed at Aaa
   -- Class A-2, $619,257,000, Fixed, affirmed at Aaa
   -- Class X, Notional, affirmed at Aaa
   -- Class B, $42,460,000, Fixed, affirmed at Aaa
   -- Class C, $39,963,000, Fixed, affirmed at Aaa
   -- Class D, $12,488,000, Fixed, affirmed at Aa1
   -- Class E, $7,493,000, Fixed, affirmed at Aa2
   -- Class F, $17,483,000, Fixed, affirmed at A1
   -- Class G, $12,489,000, Fixed, upgraded to Baa1 from Baa2
   -- Class H, $22,479,000, Fixed, affirmed at Ba1
   -- Class J, $12,488,000, Fixed, affirmed at Ba2
   -- Class K, $7,493,000, Fixed, affirmed at Ba3
   -- Class L, $7,493,000, Fixed, affirmed at B1
   -- Class M, $9,990,000, Fixed, affirmed at B3
   -- Class N, $4,996,000, Fixed, affirmed at Caa1

As of the Jan. 18, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 15.9%
to $840 million from $999.1 million at securitization.

The Certificates are collateralized by 147 mortgage loans ranging
in size from less than 1% to 9.6% of the pool, with the top 10
loans representing 33.9% of the pool.  The pool includes two
investment grade shadow rated loans and a credit tenant lease
component, representing 13.9% and 1.8%, respectively, of the pool.
Forty-six loans, representing 30.8% of the pool, have defeased and
are secured by U.S. Government securities.

Nine loans have been liquidated from the pool, resulting in
aggregate realized losses of approximately $5.3 million. Currently
there are five loans in special servicing, representing 1.8% of
the pool.  Moody's estimates aggregate losses of $3.7 million for
all of the specially serviced loans.  Thirty four loans,
representing 7.2% of the pool, are on the master servicer's
watchlist.

Moody's was provided with full year 2005 and partial year 2006
operating results for approximately 80.6% and 83.7%, respectively,
of the performing non-defeased loans.  Moody's loan to value ratio
for the conduit component is 79.4%, compared to 83.7% at Moody's
last full review in May 2005.  Moody's is upgrading Class G due to
defeasance, stable overall pool performance and increased
subordination levels.  Classes B, C, D, E, F and G were upgraded
on Dec. 8, 2006 based on a Q tool based portfolio review.

The largest shadow rated loan is the Westfield Shoppingtown South
Shore Loan at $80.9 million (9.6%), which is secured by the
borrower's interest in a 1.2 million square foot regional mall
located in Bay Shore, New York.  The center is anchored by Macy's,
Sears, J.C. Penney and Lord & Taylor.  All of the anchors are part
of the collateral except for Lord & Taylor, which is on a ground
lease.  As of November 2006 the in-line space was 88.4% occupied,
compared to 93.7% at securitization.  Moody's current shadow
rating is A2, the same as at last review.

The second shadow rated loan is the Westfield Shoppingtown Plaza
Camino Real Loan at $36.0 million (4.3%), which is secured by the
borrower's interest in a 1.1 million square foot regional mall
located approximately 35 miles north of San Diego in Carlsbad,
California.  The center is anchored by Macy's, which operates two
stores, Sears and J.C. Penney. None of the anchors are part of the
collateral.  As of September 2006 the in-line space was 95.8%
occupied, compared to 89% at securitization.  Moody's current
shadow rating is Aaa, the same as at last review.

The top three conduit loans represent 10.2% of the outstanding
pool balance.  The largest conduit loan is the Johnson City Mall
Loan at $38.8 million (4.6%), which is secured by a 545,000 square
foot regional mall located in Johnson City, Tennessee.  The center
is anchored by Belk, J.C. Penney, Sears and Goody's.  As of
September 2006, the center was 95.5% occupied, essentially the
same as at last review.  Average sales for the in-line stores in
calendar year 2005 were $388 per square foot, compared to $364 at
last review.  Moody's LTV is 64.8%, compared to 77.3% at last
review.

The second largest conduit loan is the Tompkins Square Apartments
Loan at $25.4 million (3%), which is secured by a 123-unit
multifamily property located in the East Village area of New York
City.  The property is 100% occupied, the same as at last review
and at securitization.  Moody's LTV is 76.3%, compared to 77.8% at
last review.

The third largest conduit loan is the 136 Madison Avenue Loan at
$21.2 million (2.5%), which is secured by a 284,000 square foot
office building located in midtown Manhattan.  As of October 2006,
the property was 100% occupied, compared to 93.5% at last review.
The largest tenants include Bestform Inc. and Interpublic Group of
Companies.  Moody's LTV is 51.3%, compared to 65% at last review.

The pool's collateral is a mix of retail, U.S. Government
securities, multifamily, office and mixed use, lodging, industrial
and self storage, CTL, and healthcare.  The collateral properties
are located in 25 states.  The highest state concentrations are
New York, Florida, Virginia, Tennessee and Texas.  All of the
loans are fixed rate.


LB-UBS: S&P Assigns Low-B Ratings to $51 Million Debentures
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to LB-UBS Commercial Mortgage Trust 2007-C1's
$3.71 billion commercial mortgage pass-through certificates series
2007-C1.

The preliminary ratings are based on information as of
Feb. 9, 2007.  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 pool has a debt service coverage of 1.25x, a beginning
LTV of 105.9%, and an ending LTV of 102.2%.

                    Preliminary Ratings Assigned

              LB-UBS Commercial Mortgage Trust 2007-C1


                                                Recommended
                                Preliminary     credit
        Class     Rating        amount          support
        -----     ------        -----------     -----------
        A-1       AAA            $62,000,000    30.000%
        A-2       AAA           $211,000,000    30.000
        A-3       AAA           $225,000,000    30.000
        A-AB      AAA            $95,000,000    30.000
        A-4       AAA         $1,156,051,000    30.000
        A-1A      AAA           $850,172,000    30.000
        A-M       AAA           $371,318,000    20.000
        A-J       AAA           $315,620,000    11.500
        B         AA+            $27,849,000    10.750
        C         AA             $55,697,000     9.250
        D         AA-            $37,132,000     8.250
        E         A+             $18,566,000     7.750
        F         A              $32,490,000     6.875
        X-CP(1)   AAA         $1,723,844,500     N/A
        X-W(1)    AAA         $1,856,588,417     N/A
        X-CL(1)   AAA         $1,856,588,417     N/A
        G         A-             $32,491,100     6.000
        H         BBB+           $41,773,000     4.875
        J         BBB            $41,773,000     3.750
        K         BBB-           $51,056,000     2.375
        L         BB+             $9,283,000     2.125
        M         BB              $9,283,000     1.875
        N         BB-             $9,283,000     1.625
        P         B+              $4,642,000     1.500
        Q         B               $9,283,000     1.250
        S         B-              $9,283,000     1.000
        T         NR             $37,131,833     N/A
        BMP(2)    NR             $33,457,011     N/A

       (1) Interest-only class with a notional amount.

       (2) The BMP Class is specific to the non-pooled portion of
           the Bethany Maryland Portfolio Loan.

       N/A -- Not applicable.

       NR -- Not rated.


LEAR CORP: Carl Icahn Deal Prompts S&P's Negative CreditWatch
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Southfield, Michigan-based Lear Corp. to 'B' from 'B+'
and placed its ratings on CreditWatch with negative implications
following Lear's that it had agreed to be acquired by Carl Icahn-
controlled American Real Estate Partners, L.P.  AREP has offered
to purchase Lear for $36 per share in cash, or more than
$2 billion.  AREP currently owns about 20% of Lear.

"The downgrade reflects our expectation that the transaction will
result in an increase in debt at Lear," said Standard & Poor's
credit analyst Robert Schulz.

The CreditWatch resolution will focus on the post-transaction
capital structure and any shifts in the company's business
strategies, whether from the Icahn transaction or as a result of
any other bids that may arise.  The 'B+' rating on Lear's senior
secured bank debt is affirmed and is not on CreditWatch, since we
expect that change in control language in the bank agreement means
that the bank facility will be replaced at closing.  While some
of the senior unsecured debt issues also contain change in control
language, the offer by AREP does not trigger change in control
provisions in those bonds.

Lear, an automotive supplier, has total debt of about
$3.7 billion, including the present value of operating leases and
underfunded employee benefit liabilities.

Although Lear has strong market positions, good growth prospects
outside of North America, and fair financial flexibility, its
operating performance has been challenged by severe industry
pressures that caused credit protection measures to weaken in
recent years.  Lear reported improved results during 2006,
following very poor performance during 2005 when full-year EBITDA
fell by 35%.  Core operating earnings, as defined by Lear to
exclude restructuring costs and special charges, increased by 22%
in 2006, but still remain relatively low.  Cash from operating
activities, before the net change in accounts receivable sold but
after capital spending, was $116 million in 2006, compared to a
negative $419 million in 2005.  Lear has agreed to sell its U.S.
interior components operations to a joint venture controlled by
Wilbur Ross, following a similar transaction for its European
business.


LEVEL 3 COMM: Posts $237 Million Net Loss in Quarter Ended Dec. 31
------------------------------------------------------------------
Level 3 Communications Inc. reported a net loss of $237 million on
revenues of $846 million for the fourth quarter ended Dec. 31,
2006, compared to a net loss of $128 million on $875 million of
revenues for the third quarter of 2006.

For the full year 2006, consolidated revenue was $3.38 billion,
compared to $1.72 billion in 2005.

Included in the net loss for the fourth quarter was a $54 million
loss on the extinguishment of debt.  Included in the net loss for
the third quarter was a gain of $33 million associated with the
sale of Software Spectrum.

"Level 3 had a strong fourth quarter," said James Q. Crowe, CEO of
Level 3.  "Organic core revenue growth was 8 percent during the
quarter and 25 percent annualized for the full year 2006, which
excludes the benefits of acquisition and termination revenue.
This growth is a result of ongoing customer demand and a healthy
industry operating environment.  We expect these positive trends
to continue in 2007."

                       Communications Revenue

Communications revenue for the fourth quarter 2006 was
$830 million, versus $858 million for the previous quarter.
Communications revenue decreased as a result of declines in other
communications services revenue and SBC Contract Services.  The
company recognized $8 million in termination revenue during the
fourth quarter 2006 and less than $1 million in termination
revenue during the third quarter 2006.

Communications revenue for 2006 was $3.31 billion, compared to
$1.6 billion in 2005.

                   Communications Cost of Revenue

Communications cost of revenue for the fourth quarter 2006
declined to $311 million, versus $368 million in the previous
quarter.  Cost of revenue decreased during the quarter primarily
due to lower expenses associated with SBC Contract Services
revenue, partially offset by increases from a full quarter of
costs associated with TelCove and Looking Glass.

For the full year 2006, communications cost of revenue was
$1.5 billion.

                   Communications SG & A Expenses

Communications SG&A expenses were $365 million for the fourth
quarter 2006, versus $333 million for the previous quarter.  The
fourth and third quarter 2006 Communications SG&A expenses include
$32 million and $18 million, respectively, of non-cash
compensation expense.  SG&A expenses increased in the fourth
quarter primarily due to a full quarter of expenses associated
with TelCove and Looking Glass.  The company also accelerated
integration-related expenses associated with 2006 acquisitions.

Communications SG&A expenses were $1.3 billion for 2006, versus
$761 million for 2005.  SG&A expenses increased during 2006 due to
additional headcount and other expenses as a result of the
acquisition of WilTel Communications, Progress Telecom, ICG
Communications, Looking Glass Networks and TelCove.

                            Acquisitions

On Jan. 3, 2007, Level 3 completed the purchase of Broadwing
Corporation.  Under the terms of the agreement, Level 3 paid
Broadwing stockholders $8.18 of cash plus 1.3411 shares of Level 3
common stock for each share of Broadwing common stock outstanding
at closing.  In total, Level 3 paid approximately $744 million of
cash and issued approximately 122 million shares of common stock.

On Jan. 23, 2007, Level 3 closed on the purchase of SAVVIS's CDN
business.  Level 3 paid $132.5 million in cash to acquire certain
assets, including network elements, customer contracts and
intellectual property used in SAVVIS's CDN business.

                          About Level 3

Headquartered in Broomfield, Colorado, Level 3 Communications Inc.
(Nasdaq: LVLT) -- http://www.level3.com/-- is an international
communications company.  The company provides a comprehensive
suite of services over its broadband fiber optic network including
Internet Protocol (IP) services, broadband transport and
infrastructure services, colocation services, voice services and
voice over IP services.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 20, 2006,
Standard & Poor's Ratings Services affirmed all ratings on Level
3, including the company's 'CCC+' corporate credit rating.


MAGNOLIA VILLAGE: Wants Plan Confirmation Date Moved to June 5
--------------------------------------------------------------
Magnolia Village LLC and its debtor-affiliates ask the United
States Bankruptcy Court for the District of Nevada to extend
their exclusive period to gain confirmation of their previously
filed Plan of Reorganization from March 7, 2007, to June 5, 2007.

The Debtors tell the Court that it will not be possible for them
to obtain confirmation of their Plan within the 180-day exclusive
period due to the availability of the Court's calendar and the
noticing requirements under the Bankruptcy Code.

Additionally, in open Court on Feb. 1, 2007, the Debtors
voluntarily agreed to continue the hearing on the disclosure
statement explaining their Plan from Feb. 27, 2007, to a later
date, if necessary, although they are not certain at this time if
that will be necessary, conditioned on their exclusivity rights
being preserved.

The Court will convene a hearing at 2:00 p.m. on March 7, 2007, to
consider the Debtors' request.

                Treatment of Claims Under the Plan

The Debtors' Plan proposes to pay the secured claims of CW
Advisors and LNR Partners according to their contractual
agreements with no modifications.

These secured claims will be also be paid according to contractual
agreements but with modification on the term due date, which
claims will now due Nov. 1, 2007, or upon sale of the Debtors'
real properties, whichever is earlier:

   a) Class 2 Secured Claim of First Independent Bank;

   b) Class 3A Secured Claim of First National Bank of Nevada; and

   c) Class 3B Secured Claim of First National Bank of Nevada.

The secured claim of Krump Construction, which consists of a
mechanic's lien recorded in a junior position priority against
the real property of Magnolia Double, will be paid upon closing of
the successful sale of the real property, assuming sufficient
proceeds exist after paying all senior secured loans, or on
Nov. 1, 2007, whichever date is earlier.

Holders of General Unsecured Claims will receive pro rata share of
their allowed claims.  Those claims will bear a 6% interest per
annum from Sept. 8, 2006.

The Potential Securities Claims and Other Claims of the Class A
Non-Member Investors in MBP Equity Partners LLC will be paid
through an interest bearing account from proceeds of the sale of
the Debtors' real properties.

MBP Equity Partners is a 100% member of the Debtors.  The
investors have filed state court actions against the Debtors for,
among other things, securities fraud and for rescission of their
purchase of securities of MBP Equity Partners.

The payment is pending further Court order either through an
adversary proceeding or claim proceeding or by confirmation of any
award or judgment obtained in the state court action, which
liquidates the amount due to the investors.

The Equity Claims of MBP Equity Partners I, LLC will not be
modified.

                           Plan Funding

Distribution under the Plan will be sourced from the sale of the
Debtors' real properties.

As reported in the Troubled Company Reporter on Feb. 7, 2007,
Magnolia Village will be selling its real property complex located
at 6900 South McCarran Boulevard in Reno, Nevada for $24,000,000.

The Magnolia Village real property complex consists of a 205,016
square feet office park with retail space and a central three-
story office building.

Three debtor-affiliates will also be selling these real properties
for a total purchase price of $22,362,500:

    Seller                            Property
    ------                            --------
    Magnolia Double R.I., LLC         three commercial buildings
                                      and two vacant land
                                      parcels at Sandhill, in
                                      Reno, Nevada

    Magnolia South Meadows III, LLC   office building at Gateway
                                      Drive, in Reno, Nevada

    Magnolia South Meadows IV, LLC    office building at Double
                                      Eagle Court, in Reno, Nevada

A full-text copy of the Disclosure Statement explaining the
Debtors' Joint Plan of Reorganization is available for a fee at:

  http://www.researcharchives.com/bin/download?id=070212033047

                      About Magnolia Village

Based in Reno, Nevada, Magnolia Village LLC, is a luxurious
resort-style Class A Office Park.  The company and its
affiliates filed for chapter 11 protection on Sept. 8, 2006
(Bankr. D. Nev. Case No. 06-51649).  Stephen R. Harris, Esq. at
Belding, Harris & Petroni Ltd. represents the Debtors.  No
Official Committee of Unsecured Creditors has been appointed in
this case.  When Magnolia Village filed for protection from its
creditors, it listed estimated assets between $10 million and
$50 million and debts between $100,000 to $500,000.


MERITAGE HOMES: Fitch Holds Unsecured Credit Facility Rating at BB
------------------------------------------------------------------
Fitch affirms Meritage Homes Corporation's as:

   -- Issuer Default Rating 'BB';
   -- Senior unsecured 'BB'; and,
   -- Unsecured bank credit facility 'BB'.

The rating applies to approximately $479 million in senior notes
and the $850 million revolving credit facility.   The Rating
Outlook has been changed from Positive to Stable.

A Positive Outlook was predicated on the assumption that credit
metrics would further improve and then be generally maintained for
a reasonable period of time.   Prospects of that occurring over
the next few quarters or even next twelve months appear unlikely
due to the broadly deteriorating housing market.

The housing sector is in the midst of a meaningful, multi-year
downturn.   Meritage has been increasing its sales and marketing
efforts, focusing on reducing speculative inventory, reducing its
lot supply, reassessing land positions, renegotiating option
contracts and reducing overhead and direct construction costs.
During this current downturn Meritage, like most builders, has
leveraged the financial flexibility of land options, walking away
from over priced lots.  These builders have also reported
meaningful charges associated with write downs of land values.
Fitch anticipates a lesser amount of these non-cash real estate
charges will be reported by Meritage in 2007.  Fitch expects
Meritage will continue to manage its liquidity as is appropriate
for this current housing downturn.  Coverage ratios are expected
to be lower in 2007.

Ratings for Meritage are based on the company's successful
execution of its business model, conservative land policies and
geographic and product line diversity.  The company has been an
active consolidator in the homebuilding industry which has led to
above average growth during the seven years concluding 2005, but
had kept leverage levels somewhat higher than its peers until the
past few years.  Management has also exhibited an ability to
quickly and successfully integrate its acquisitions.  In any case,
now that the company has reached current scale there may be
relatively less use of acquisitions going forward and acquisitions
are likely to be smaller relative to Meritage's current size.

Risk factors include the inherent cyclicality of the homebuilding
industry.  The ratings also manifest the company's aggressive, yet
controlled growth strategy and Meritage's capitalization and size.

Currently, the company's EBITDA, EBIT and FFO to interest ratios
tend to be somewhat stronger than the average public builder,
while its turnover ratio is higher and its leverage, FFO adjusted
leverage and debt to EBITDA ratios are better.  Although the
company has certainly benefited from the generally strong housing
market of recent years, a degree of profit enhancement is also
attributed to purchasing, design and engineering, access to
capital and other scale economies that have been captured by the
large national and regional public homebuilders in relation to
non-public builders.  These economies, the company's presale
operating strategy and return on equity and return on assets
orientation provide the framework to soften the margin impact of
declining market conditions in comparison to previous cycles.
Meritage's ratio of sales value of backlog to debt, consistently
at least 2x from 1997 to 2005, was 1.6x as of year end 2006: still
a reasonably comfortable cushion.

Meritage's sales are reasonably dispersed among its 14
metropolitan markets.  Typically, about 70-75% of home deliveries
are to first and second time trade up buyers, 10-15% to entry
level buyers, 5% are to luxury home buyers and 5-10% to active
adult buyers.

The company is positioned in six of the ten largest single family
markets in the country.  The company was ranked in 2005 among the
ten largest builders in Phoenix/Mesa, Ft.  Worth/Arlington,
Austin/Roundrock, Tucson, Oakland, Stockton, California,
Dallas/Plano/Irving, San Antonio, Naples/Marcos Island, Florida
and Pittsburgh by Builder Magazine.

Meritage employs quite conservative land and construction
strategies.  The company typically options or purchases land only
after necessary entitlements have been obtained so that
development or construction may begin as market conditions
dictate.  Meritage extensively uses lot options.  The use of
non-specific performance rolling options gives the company the
ability to renegotiate price/terms or void the option which limits
down side risk in market downturns and provides the opportunity to
hold land with minimal investment.  As of Dec.  31, 2006, 83% of
its lots were controlled through options - a higher percentage
than almost all other public builders.  Total lots, including
those owned, were approximately 44,075 at Dec. 31, 2006.  This
represents a 4.2 year supply based on trailing 12 months
deliveries.  Typically 85-90% of its homes are pre-sold.  The
balance are homes under construction or homes completed in advance
of a customer's order.  Meritage's inventory of presold homes
under construction was 47.4% as of Sept. 30, 2006, representing
very liquid assets.  Land held for development usually represents
1-6% of real estate inventories and was only 0.3% as of Sept. 30,
2006.

Meritage has limited off balance sheet activities, excluding the
option activities.  The company has only one housing joint
venture, but participates in approximately 20 land development
JVs.  The company also participates in financial services JVs in
certain markets.  The profits generated are primarily fees for
originating mortgages and gain on sale of servicing.  Meritage
and/or its JV partners occasionally provide limited repayment
guarantees on debt of certain unconsolidated entities on a pro
rata share basis.  As of Sept. 30, 2006, the company had limited
repayment guarantees of about $43.6 million.  Meritage's
unconsolidated JVs debt/capitalization ratio was 65.2% as of
Sept. 30, 2006, while net debt to capitalization was 63.3%.
Meritage's consolidated debt/capitalization ratio was 44.2% as of
Sept.  30, 2006 and 42.2% as of Dec. 31, 2006.

Meritage has completed eleven acquisitions since going public in
1996.  The company has also entered markets on a 'greenfield'
basis.  The acquisitions have enabled the company to build its
position, often broadening product and customer bases in existing
markets.  They have also enabled the company to enter new markets.
The combinations typically were funded by debt and to a lesser
degree by stock.  Frequently, there were earn-outs which reduced
risk and served to retain key management.  Now that Meritage has
reasonable scale there may be less use of acquisitions going
forward.  On average acquisitions are likely to be smaller
relative to Meritage's current size.  Fitch believes that
management would balance debt and stock as acquisition currency to
at least maintain current credit ratios.  In any case, Fitch does
not expect the company to make consequential acquisitions, while
the housing market is contracting.

Meritage's liquidity is ample.  As of Dec. 31, 2006, the company
had $57 million in cash and equivalents and $449 million in
borrowing availability on its $850 million revolving credit
facility, maturing May 2010.  The company has irregularly
purchased moderate amounts of its stock in the past.  The company
repurchased $105.4 million in common stock in 2006.  $52 million
of which was purchased from John Landon, the company's former
co-CEO and co-chairman.  The current remaining repurchase
authorization is $130.2 million.

In mid-May 2006 the company's co-chairman and co-CEO, John R.
Landon resigned.  Mr.  Landon had been with Meritage since 1997
when Texas-based Legacy Homes, a company founded in 1987, merged
with Monterey Homes to form Meritage Homes.  Steve Hilton, the
company's other co-chairman and co-CEO remained as the sole
chairman and CEO.  In mid-October 2006, Meritage reported the
appointment of Steve Davis as executive VP - national homebuilding
operations, reporting to Steve Hilton.


MERRILL LYNCH: Moody's Affirms B2 Rating on $5 Mil. Class G Certs.
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of two classes and
affirmed the ratings of seven classes of Merrill Lynch Mortgage
Loans Inc., Commercial Mortgage Pass-Through Certificates, Series
2000-Canada 3:

   -- Class A-1, $19,799,836, Fixed, affirmed at Aaa
   -- Class A-2, $131,400,000, Fixed, affirmed at Aaa
   -- Class X, Notional, affirmed at Aaa
   -- Class B, $7,727,000, Fixed, affirmed at Aaa
   -- Class C, $8,372,000, Fixed, affirmed at Aaa
   -- Class D, $10,304,000, WAC, upgraded to A2 from A3
   -- Class E, $2,576,000, WAC, upgraded to Baa2 from Baa3
   -- Class F, $7,084,000, Fixed, affirmed at Ba2
   -- Class G, $5,151,000, Fixed, affirmed at B2

As of the Jan. 15, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 23.3%
to $197.6 million from $257.6 million at securitization.  The
Certificates are collateralized by 41 mortgage loans ranging in
size from less than 1% to 7.9% of the pool, with the top 10 loans
representing 46.8% of the pool.  Three loans, representing 6.5% of
the pool, has defeased and are collateralized with Canadian
Government securities.

The pool has not experienced any losses since securitization and
currently there are no loans in special servicing.  Seven loans,
representing 9.4% of the pool, are on the master servicer's
watchlist.

Moody's was provided with full year 2005 financials for 70.7% of
the pool.  Moody's loan to value ratio is 60.5%, compared to 66.5%
at Moody's last full review in April 2005 and compared to 73.4% at
securitization.  Moody's is upgrading Classes D and E due to
stable pool performance and increased subordination levels.
Classes C and D were upgraded on December 8, 2006 based on a Q
tool based portfolio review.

The top three loans represent 20.9% of the pool:

The largest loan is the Woodside Square Shopping Center Loan at
$15.7 million (7.9%), which is secured by a 291,000 square foot
shopping center located in Toronto, Ontario.  As of March 2006 the
property was 86.9% leased, compared to 95% at last review.  The
center is anchored by Food Basics Supermarket and Winners
Department Store.  The property's financial performance has
declined since last review due to the decrease in occupancy.
Moody's LTV is 64.7%, compared to 63.2%, at last review.

The second largest loan is the Somerset House Loan at
$14.9 million (7.5%), which is secured by a 138-unit congregate
care facility located in Victoria, British Columbia.  As of
December 2006, the property was 99.6% occupied, essentially the
same as at last review.  Moody's LTV is 76.7%, compared to 77.3%
at last review.

The third largest loan is the Delta St. John's Loan at
$10.9 million (5.5%), which is secured by a 276-room full service
hotel located in St. John's, Newfoundland.  The hotel's
performance has improved since securitization due to higher room
rates and loan amortization.  Moody's LTV is 61.1%, compared to
65.2% at last review.

The pool's collateral consists of retail, multifamily, lodging,
industrial and self storage, Canadian Government securities and
office.  The collateral properties are located in six Canadian
provinces.  The top three province concentrations are Ontario,
Alberta and British Columbia.  All of the loans are fixed rate.
Approximately 40.5% of the pool is recourse to the respective
borrowers.


MORGAN STANLEY: Moody's Lifts Junk Rating on Class G Certs. to B2
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes
and affirmed the ratings of five classes of Morgan Stanley Capital
I Inc., Commercial Mortgage Pass-Through Certificates, Series
1997-XL1:

   -- Class A-3, $101,962,627, Fixed, affirmed at Aaa
   -- Class X, Notional, affirmed at Aaa
   -- Class B, $22,636,000, Fixed, affirmed at Aaa
   -- Class C, $22,636,000, Fixed, affirmed at Aaa
   -- Class D, $45,271,000, Fixed, upgraded to Aaa from Aa1
   -- Class E, $45,271,000, Fixed, upgraded to Aaa from A2
   -- Class G, $26,408,000, Fixed, upgraded to B2 from Caa2
   -- Class H, $460,053, Fixed, affirmed at C

As of the Feb. 5, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 59.4%
to $306.1 million from $754.5 million at securitization as a
result of the payoff of six loans, the liquidation of the Westgate
Mall and Westshore Mall Loans and loan amortization.  The four
remaining loans range in size from 15.1% to 39.2% of the pool
based on current principal balances.  Two of the remaining loans,
which comprise 66.2% of the aggregate certificate balance, have
defeased in their entirety -- 605 Third Avenue and Edens & Avant.

Moody's current loan to value ratio for the non-defeased portion
of the pool is 51.7%, compared to 70.6% at last review.  Moody's
is upgrading Classes D, E and G due to additional loan payoffs,
defeasance, scheduled loan amortization and the improved
performance of the Grand Kempinski Hotel Loan.

The Fashion Mall Loan at $57.4 million (18.7%) is secured by a
leasehold interest in Keystone at the Crossing Fashion Mall, an
enclosed two-anchor regional mall located in the northern suburbs
of Indianapolis, Indiana.  The property is anchored by Saks Fifth
Avenue and Parisian and contains approximately 682,912 square
feet, of which 349,222 square feet is mall shop gross leasable
area.  Saks Fifth Avenue replaced Jacobson's in September 2003.
Property performance has been stable.  Comparable in-line tenant
sales were $548 per square foot in calendar year 2005 and are
projected to be $572 per square foot in calendar year 2006.The
loan sponsor is Simon Property Group, L.P.  Moody's LTV is 40.3%,
compared to 43.4% at Moody's last review.  Moody's current shadow
rating is Aaa, compared to Aa1 at last review.

The Grand Kempinski Hotel Loan at $46.2 million (15.1%) is secured
by a 528-room hotel currently flagged as the Hotel
Intercontinental Dallas.  The hotel features extensive meeting and
banquet facilities and is located in north Dallas, Texas.
Historically the property has performed well below Moody's
expectations with the borrower funding shortfalls.  However,
performance has significantly improved over the past two years.
Extensive hotel-wide renovations have been completed including all
but 39 of the guestrooms.  For the nine-month period ending
September 2006, occupancy was 67.5%. RevPAR for the same period
was $75.88, compared to $77.58 at securitization.  Moody's LTV is
79.4%, compared to in excess of 100% at last review.  Moody's
current shadow rating is B1, compared to Caa2 at last review.


MORGAN STANLEY: S&P Rates $9 Million Class Q Certificates at B-
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Morgan Stanley Capital I Trust 2007-HQ11's
$2.42 billion commercial mortgage pass-through certificates series
2007-HQ11.

The preliminary ratings are based on information as of
Feb. 9, 2007.  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
fiscal agent, the economics of the underlying loans, and the
geographic and property type diversity of the loans.

These classes are being offered publicly:

   -- Class A-1
   -- Class A-1A
   -- Class A-2
   -- Class A-3
   -- Class A-AB
   -- Class A-4
   -- Class A-M
   -- Class A-J
   -- Class B
   -- Class C
   -- Class D
   -- Class E
   -- Class F
   -- Class G

Standard & Poor's analysis determined that, on a weighted average
basis, the pool has a debt service coverage of 1.35x, a beginning
LTV of 111.9%, and an ending LTV of 106.8%.  The pool includes
seven loans that consist of related loans that are cross-defaulted
and cross-collateralized with each other.  For the purposes of
this report, each of these loan groups is considered to be one
loan.

                    Preliminary Ratings Assigned
              Morgan Stanley Capital I Trust 2007-HQ11

                                                Recommended
                                 Preliminary    credit
        Class      Rating        amount         support
        -----      ------        -----------    -----------
        A1         AAA           $44,400,000      30.000%
        A2         AAA          $196,200,000      30.000%
        A3         AAA          $356,000,000      30.000%
        AAB        AAA           $59,300,000      30.000%
        A4         AAA          $680,573,000      30.000%
        A1A        AAA          $355,879,000      30.000%
        AM         AAA          $241,765,000      20.000%
        AJ         AAA          $190,389,000      12.125%
        B          AA+           $18,133,000      11.375%
        C          AA            $36,264,000       9.875%
        D          AA-           $24,177,000       8.875%
        E          A+            $12,088,000       8.375%
        F          A             $21,155,000       7.500%
        G          A-            $24,176,000       6.500%
        H          BBB+          $27,199,000       5.375%
        J          BBB           $24,176,000       4.375%
        K          BBB-          $33,243,000       3.000%
        L          BB+            $9,066,000       2.625%
        M          BB             $6,044,000       2.375%
        N          BB-            $9,066,000       2.000%
        O          B+             $3,022,000       1.875%
        P          B              $9,066,000       1.500%
        Q          B-             $9,067,000       1.125%
        S          NR            $27,198,574      30.000%
        X*         AAA        $2,417,646,574      30.000%

            *Interest-only class with a notional amount.
                          N -- Not rated.

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(Ratings Services) are the result of separate activities designed
to preserve the independence and objectivity of ratings opinions.
The credit ratings and observations contained herein are solely
statements of opinion and not statements of fact or
recommendations to purchase, hold, or sell any securities or make
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NASDAQ STOCK: Fails in $5.3 Billion Bid for London Stock Exchange
-----------------------------------------------------------------
Nasdaq Stock Market Inc. failed in its bid to takeover the London
Stock Exchange PLC.  LSE shareholders rejected Nasdaq's
$5.3 billion bid on Feb. 10, 2007, reports say.

Nasdaq said that only 0.41% of LSE's ordinary shares were tendered
and accepted.  Its existing 28.75% share of LSE's stock plus the
newly accepted shares fell short of the 50% it needed to begin
taking control of the London exchange.

Nasdaq Chief Executive Officer Bob Greifeld, in a statement to the
media, said, "Nasdaq will continue to pursue other opportunities
to build on its existing position as the world's largest
electronic equities exchange and we look forward to maintaining
our strong track record of creating shareholder value through our
industry-leading business model and strategy."

According to various news articles, the LSE is in talks with the
Tokyo Stock Exchange to explore a strategic alliance.

LSE previously indicated that Nasdaq's $24.42 offer is too low.
Nasdaq, on the other hand, refused to up the ante because it
believes that LSE's stock is overvalued.

The Nasdaq Stock Market Inc. -- http://www.nasdaq.com/-- is the
largest electronic equity securities market in the United States
with approximately 3,200 companies.

                          *     *     *

In December 2006, Standard & Poor's Rating Services lowered its
long-term counterparty credit rating on The Nasdaq Stock Market
Inc. to 'BB' from 'BB+'.  S&P affirmed the 'BB+' rating on
Nasdaq's existing bank loan facility, which financed the initial
29% stake in the London Stock Exchange, and revised the Recovery
Rating to '1' from '2'.  The ratings were removed from CreditWatch
Negative where they were placed on Nov. 20, 2006.  S&P said the
outlook is stable.

At the same time, Standard & Poor's assigned its 'BB+' bank loan
rating to $750 million senior secured Term Loan B, $2 billion
senior secured Term Loan C, and $75 million revolver issued by
Nasdaq, as well as the $500 million senior secured Term Loan C
issued by Nightingale Acquisition Ltd., a U.K.-based subsidiary of
Nasdaq.

The rating agency assigned a Recovery Rating of '1', which
indicates full recovery of principal in the event of default.

In addition, Standard & Poor's assigned its 'B+' rating to
$1.75 billion senior unsecured bridge loan issued by Nasdaq and
NAL.

Moody's Investors Service assigned in April 2006 ratings to
three bank facilities of The Nasdaq Stock Market Inc.: a
$750 million Senior Secured Term Loan B, a $1.1 billion Secured
Term Loan C, and a $75 million Senior Secured Revolving Credit
Facility.  Moody's said each facility is rated Ba3 with a negative
outlook.


NATIONAL BEDDING: Moody's Junks Rating on $210 Mil. Sr. Facility
----------------------------------------------------------------
Moody's Investors Service assigned a B1 to National Bedding's, dba
Serta, senior secured first lien facility and a Caa1 rating to
Serta's senior secured 2nd lien facility.

At the same time, Moody's downgraded Serta's corporate family
rating and probability of default rating to B2.

The rating outlook is stable.

The 1st and 2nd lien are being amended and restated with the
proceeds to be used to refinance part of the redeemable 12%
preferred stock held by shareholders.

"With this transaction, the company's financial sponsors have
replaced equity capital with senior (secured) debt, but adding
incremental financial risk for creditors in the process" said
Kevin Cassidy, Vice President/Senior Analyst at Moody's.

"[T]he rating downgrades reflect this more aggressive financial
posture and the increase in leverage, which will constrain any
upwards rating momentum in the near term."

However, Mr. Cassidy also stated that "the company's steady cash
flow and expected future focus on delevering provide a buffer
against the uncertainty in consumer spending, high raw material
prices and softness in the housing market that could otherwise
jeopardize projected operating results."

The ratings for both the senior secured 1st lien credit facility,
which is comprised of a $400 million term loan and a $50 million
revolver, and the senior secured 2nd lien facility, reflect both
the overall probability of default of the company and their
respective estimated loss given default assessments of LGD3 and
LGD 5.  Both facilities benefit from the full guarantees of
subsidiaries and an all asset pledge.

Ratings assigned:

   -- $400 million senior secured 1st lien term loan at B1, LGD3,
      33%;

   -- $50 million senior secured revolving credit facility at B1,
      LGD3, 33%; and

   -- $210 million senior secured second lien facility at Caa1,
      LGD5, 84%.

Ratings downgraded:

   -- Corporate family rating to B2 from B1; and
   -- Probability of default rating to B2 from B1.

National Bedding Company, based in Hoffman Estates, Illinois, is a
major manufacturer of mattresses under the Serta brand name.  Net
sales for the LTM period ended September 2006 approximated
$725 million.


NATIONAL BENEVOLENT: Weil Gotshal Malpractice Suit Dismissed
------------------------------------------------------------
The Honorable Ronald B. King of the U.S. Bankruptcy Court for the
Western District of Texas, San Antonio Division, entered an order
dismissing National Benevolent Association's adversary proceeding
(Bankr. W.D. Tex. Adv. Pro. No. 05-5134) against its lead
bankruptcy counsel, Weil Gotshal & Manges LLP.  The suit alleged
that the high-profile New York law firm misled the organization
into filing for bankruptcy with disastrous results.

Judge King says that National Benevolent's contentions that the
Chapter 11 cases were unnecessary, ill-conceived and never should
have been filed constitute a collateral attack on the Court's
orders approving the sale of the business for $210 million and
confirming the Debtor's plan of reorganization that returned 100%
to creditors with interest.  Judge King says the company should
have raised those complaints before entry of those two orders.
National Benevolent knew the facts giving rise to its claims
against the law firm but chose to keep their potential claims
"under the radar" until well after confirmation, Judge King
observes, while simultaneously arguing that confirmation of its
plan was in the best interests of itself and its creditors.  The
doctrine of judicial estoppel prohibits the assertion of such
inconsistent positions, Judge King says.

Weil Gotshal's $10 million fee application remains subject to
review by Judge King in National Benevolent's chapter 11 case.

Daniel Sheehan, Esq., at Daniel Sheehan & Associates LLP,
represents National Benevolent.

A full-text copy of National Benevolent's Post-Confirmation
Complaint, filed Sept. 14, 2005, is available at no charge at:

             http://ResearchArchives.com/t/s?19c3

Headquartered in Saint Louis, Missouri, The National Benevolent
Association of the Christian Church (Disciples of Christ) --
http://www.nbacares.org/-- manages more than 70 facilities
financed by the Department of Housing and Urban Development and
owns and operates 18 other facilities, including 11 multi-level
older adult communities, four children's facilities and three
special-care facilities for people with disabilities.  The non-
profit organization filed for chapter 11 protection on February
16, 2004 (Bankr. W.D. Tex. Case No. 04-50948).  Alfredo R. Perez,
Esq., at Weil, Gotshal & Manges, LLP, represented the Debtors in
their restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed more than $200 million in debts and
assets at that time.  The organization emerged from chapter 11
protection on April 15, 2005.


NAVIOS MARITIME: Buys Kleimar's Share Capital for $165.6 Million
----------------------------------------------------------------
Navios Maritime Holdings Inc. has acquired all of the outstanding
share capital of Kleimar N.V. for $165.6 million.  It was
anticipated that the net cash paid for the shares would be
$140.3 million, taking into account the cash retained on Kleimar's
balance sheet and certain proceeds from an asset sale.

"Navios has achieved a number of benefits resulting from this
acquisition," Angeliki Frangou, Chairman and CEO of Navios,
stated.

These are:

   * A strong foothold in the capesize sector, which was in great
     demand for transporting iron ore and coal to Asia and
     elsewhere.

   * Expanded blue chip client list, considering Kleimar's
     reputation with steel companies, utilities and other
     industrial houses. Kleimar conducted business with Total,
     Arcelor, Constellation Energy and BAO Steel.

   * Increased ability to capture information relating to
     the transport of commodities essential for building
     infrastructure.

"The business model of Kleimar was similar to that of Navios;
Kleimar has owned vessels, long term chartered-in vessels at rates
below current market rates, purchase options and an established
COA business," Ms. Frangou continued.  Kleimar's application of
this business model complemented Navios' panamax/handymax
platform.  Kleimar's extensive COA business was an additional
diversification in Navios's business."

The purchase of Kleimar was financed with existing cash on
Navios's balance sheet and Navios's $120 million revolver credit
facility with HSH Nordbank and Commerzbank AG.  Navios expected
that the resulting use of debt would be in line with Navios's
current leverage.  Navios expected this transaction to be
accretive to shareholders, both from a cash flow and earnings
standpoint.

S. Goldman Advisors LLC, HSH Corporate Finance GmbH, and
Investments and Finance Ltd. represented Navios in this
transaction.  Clarkson PLC assisted Kleimar in this transaction.

                          About Kliemer

Kleimar is a Belgian maritime transportation company established
in 1993.  Kleimar has 11 employees and is an owner and operator of
capesize and panamax vessels used in transporting cargoes.  It
also has an extensive Contract of Affreightment business, a large
percentage of which involves transporting cargo to Chinaut Navios
Maritime.

                      About Navios Maritime

Based in Norwalk, Connecticut, Navios Maritime Holdings Inc.
(Nasdaq: BULK, BULKU, BULKW) -- http://www.navios.com/-- is an
integrated global seaborne shipping company, specializing in the
worldwide carriage, trading, storing, and other related logistics
of international dry bulk cargo transportation.  The company also
owns and operates a port/storage facility in Uruguay and has
in-house technical ship management expertise.  It has offices in
Piraeus, Greece, South Norwalk, Connecticut and Montevideo,
Uruguay.

                          *    *    *

Navios Maritime's 9-1/2% Senior Notes due 2014 carry Moody's
Investors Service's B2 rating and Standard & Poor's B rating.


NEWCOMM WIRELESS: Governmental Units Can File Claims Until May 28
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico set
May 28, 2007, as the deadline for governmental units to file their
proofs of claim against NewComm Wireless Services Inc.

The Court previously set Feb. 7, 2007, as the last day for persons
holding claims that arose prior to Nov. 28, 2006, to file their
proofs of claim against the Debtor.

Proofs of claim must be mailed or delivered on or before the
May 28 Bar Date to:

       NewComm Wireless Services Inc.
       Claims Docketing Center
       c/o Logan & Company Inc.
       546 Valley Road
       Upper Montclair, NJ 07043

Based in Guaynabo, Puerto Rico, NewComm Wireless Services Inc.
is a PCS company that provides wireless service to the Puerto
Rico market.  The company is a joint venture between ClearComm,
L.P. and Telefonica Larga Distancia.  The company filed for
chapter 11 protection on Nov. 28, 2006 (Bankr. D. P.R. Case No.
06-04755).  Carmen D. Conde Torres, Esq., at C. Conde & Assoc.
and Peter D. Wolfston, Esq., at Sonnenschein Nath & Rosenthal
LLP represent the Debtor in its restructuring efforts.  Mark J.
Wolfson, Esq. at Foley & Lardner LLP and Sergio A. Ramirez de
Arellano, Esq., at Sergio Ramirez de Arrelano Law Office represent
the Official Committee of Unsecured Creditors.  When the Debtor
filed for protection from its creditors, it reported assets and
liabilities of more than $100 million.


PACIFIC COAST:  Moody's Rates $96 Mil. Class B Senior Notes at B3
-----------------------------------------------------------------
Moody's Investors Service has taken action on notes issued by
Pacific Coast CDO Ltd., a collateralized debt obligation issuer:

   *The $450,000,000 Class A First Priority Senior Secured
    Floating Rate Notes due 2036

      -- Prior Rating: Aa2
      -- Current Rating: Aa2 and on watch for possible downgrade

   * The $96,000,000 Class B Second Priority Senior Secured
     Floating Rate Notes due 2036

      -- Prior Rating: Ba1 and on watch for possible downgrade
      -- Current Rating: B3

According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, as well as the occurrence of asset
defaults and par losses.  As reported in the December 2006 trustee
report, the weighted average rating factor of the portfolio was
2053, significantly higher than the transaction's trigger level of
475.  The overcollateralization test for the Class A and Class B
notes was reported at 85.3%.  Additionally, the interest coverage
test for the Class A and Class B notes was reported at 108.68%.


PHILLIPS-VAN: Enters Licensing Pact with Timberland Company
-----------------------------------------------------------
Phillips-Van Heusen Corporation has entered into a licensing
arrangement with The Timberland Company to design, source and
market men's and women's casual sportswear under the Timberland
brand in North America.  The company will assume management of the
men's apparel line in Fall 2008 and launch a women's line in Fall
2009.

Distribution of the Timberland brand product will be principally
through department and specialty stores, as well as Timberland's
own full price and outlet retail stores.  It is estimated that the
men's line will be available in approximately 600 department store
doors in Fall 2008, in addition to specialty store distribution.

Sales of Timberland brand apparel in North America were
approximately $70 million in 2006.  Phillips-Van Heusen expects
to incur a total of approximately $5 million of start-up costs in
2007, associated with design, merchandising and selling expense.

The company continues to estimate that, including these start-up
expenses, 2007 earnings per share will be in the $2.97-$3.05
range, which also excludes the impact of the acquisition of
Superba, completed in January 2007, which is expected to be
modestly accretive.

"Our partnership with Timberland pairs the apparel design,
logistics and marketing expertise of PVH with the strength and
heritage of the Timberland brand" Emanuel Chirico, Chief Executive
Officer of Phillips-Van Heusen Corporation said.  "Timberland
is an authentic outdoor traditional brand which has a unique
positioning.  It will complement the company's strong stable of
brands and enable us to reach a broader spectrum of consumers."

"We are pleased to enter into this agreement with a powerful
partner like Phillips-Van Heusen" Jeffrey Swartz, Timberland
President and CEO said.  "They have the capabilities to help us
maximize our brand potential through an improved apparel offering
and strengthened distribution under the Timberland label.  With
their impressive portfolio of high-quality premium brands and our
shared commitment to responsible manufacturing, I believe we are
poised for success."

Phillips-Van Heusen Corporation (NYSE:PVH) -- http://www.pvh.com/
-- owns and markets the Calvin Klein brand worldwide.  It is a
shirt company that markets a variety of goods under its own
brands: Van Heusen, Calvin Klein, IZOD, Arrow, Bass and G.H. Bass
& Co., Geoffrey Beene, Kenneth Cole New York, Reaction Kenneth
Cole, BCBG Max Azria, BCBG Attitude, Sean John, MICHAEL by Michael
Kors, Chaps, and Donald J. Trump Signature.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 14, 2006,
Moody's Investors Service upgraded Phillips Van Heusen
Corporation's corporate family rating to Ba2 from Ba3.

The company's senior secured notes were upgraded to Baa3 from Ba1
and the company's senior unsecured notes were upgraded to Ba3 from
B1.  The company's probability of default rating was also upgraded
to Ba2 from Ba3.


PITTSFIELD WEAVING: Ct. Extends Cash Collateral Access to Feb. 17
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Hampshire
authorized Pittsfield Weaving Company to continue using the cash
collateral securing repayment of its obligations to CapitalSource
Financial LLC through Feb. 17, 2007.

As adequate protection, the Debtor granted CapitalSource
replacement liens or security interests in and to all of the
Debtor's postpetition assets of the same kinds and types as the
cash collateral.  The replacement liens will be continuing,
perfected security interests in and to the postpetition cash
collateral and will have priority as the perfected security
interests held by CapitalSource when the Debtor filed for
bankruptcy on Sept. 20, 2006.

The Debtors will use the cash collateral to pay the costs and
expenses incurred in the ordinary course of business during the
period between Jan. 3, 2007, and Feb. 17, 2007.

The Debtor says it has not lost any sales since filing for
bankruptcy and continues to receive new orders from customers.
V.F. Corp., the Debtor's largest customer, has assured the Debtor
that it will continue to place orders with the Debtor.

The Debtor further says that its business and assets have far more
value in reorganization than in liquidation.  The Debtor values
the inventory on its books at more than $3,500,000 on a lesser of
cost or wholesale basis.  CapitalSource pleaded in its Verified
Writ of Replevin filed in the Superior Court for Merrimack County,
New Hampshire that the inventory had an orderly value of $1.9
million -- a difference of $1,600,000.  If converted to accounts
receivable, the inventory has even more value as collateral.

Papers filed with the Court did not indicate how much the Debtor
owes CapitalSource.

Based in Pittsfield, New Hampshire, Pittsfield Weaving Company --
-- http://www.pwcolabel.com/-- provides brand identification to
the apparel and soft goods industries, and manufactures woven and
printed labels and RFID/EADS solutions.  The company filed it
chapter 11 protection on Sept. 20, 2006 (Bankr. D. NH Case
No. 06-11214).  Williams S. Gannon, Esq., at William S. Gannon
PLLC represent the Debtor in its restructuring efforts.  Bruce A.
Harwood, Esq., at Sheehan Phinney Bass + Green, PA serves as
counsel to the Official Committee of Unsecured Creditors.
Pittsfield Weaving estimated its assets and debts at $10 million
to $50 million when it filed for protection from its creditors.


PORT BARRE: $185 Million Credit Facilities Rated B+ by S&P
----------------------------------------------------------
Standard & Poor's Rating Services assigned a 'B+' issue rating and
'3' recovery rating to Port Barre Investments LLC's $185 million
credit facilities consisting of $65 delayed draw million term loan
A and $120 million term loan B.

The outlook is stable.

The '3' recovery rating represents a meaningful recovery of
principal in a default scenario.  Proceeds of the loan will be
used for the development and construction of two 6.75 billion
cubic feet high deliverability salt-dome caverns, in St. Landry
Parish, Louisiana, as well as to fund initial base gas
requirements, and a debt service reserve.  The project which will
be 45 miles north of Henry Hub will have interconnections with
multiple interstate pipelines.

The stable outlook reflects Standard & Poor's near-term
expectation as construction proceeds.  The ratings could be
pressured by significant construction delays or cost overruns, or
if a shift in market fundamentals supports lower storage rates,
while a significant percentage of the project's storage capacity
remains uncontracted.

However, as construction risks subside, and with significant
storage capacity under firm storage contracts, the rating could
gain positive momentum.


PRIMEDIA INC: Board Approves Sale of Enthusiast Media Segment
-------------------------------------------------------------
The Board of Directors of PRIMEDIA Inc. has authorized the company
to explore the sale of its Enthusiast Media segment.  The company
has retained Goldman Sachs and Lehman Brothers to manage this
process.

"The Board believes the market environment is extremely favorable
for the sale of Enthusiat Media" Dean Nelson, Chairman, President
and CEO of PRIMEDIA, said.  "We have spent considerable time
reviewing strategic options for the company and have been
exploring, at the Board's direction, a possible spin off of our
consumer source division, creating two distinct publicly traded
companies.  We have received a favorable IRS ruling and virtually
completed complying with the Securities and Exchange Commission
regulations.  Therefore, spinning off the Consumer Source business
remains an option.

"However, given the multiples PRIMEDIA received from the sale of
the Outdoors Group and the particularly strong investment and debt
markets, the Board believes the best course of action for PRIMEDIA
shareholders is exploring the complete sale of Ethusiat Media,"
Mr. Nelson said.  "In addition, we are seeing positive results
from our online and product investments, which we believe will be
valued by potential acquirers.  We believe there will be strong
appetite for our leading brands."  Mr. Nelson added, "The company
will apply the proceeds from the sale to pay down debt."

Enthusiat Media is a media company in the U.S. with over 70
publications, 90 websites and over 65 events, with revenues
of over $500 million in 2006.   The company owned Motor Trend;
Automobile; Hot Rod; Automotive.com; Power and Motoryacht; and
Surfer.

PRIMEDIA Inc. -- http://www.primedia.com/-- is a targeted
media company which owns more than 200 brands that connect buyers
and sellers through print publications, web sites, events,
newsletters, and video programs.

                          *     *     *

Moody's Investors Service assigned a B2 8-7/8% $500 million Senior
Notes Rating Due 2001 to PRIMEDIA Inc., while Standard & Poor's
placed a B rating on the notes.


PSS WORLD: Earns $11.1 Million in Quarter Ended Dec. 29, 2006
-------------------------------------------------------------
PSS World Medical Inc. reported $11.1 million of net income on
$458.6 million of net sales for the third quarter ended Dec. 29,
2006, compared with $12.4 million of net income on $423.8 million
of net sales for the same period ended Dec. 30, 2005.

David A. Smith, President and Chief Executive Officer, commented,
"Our team delivered a very good quarter for both customers and
shareholders.  Our customer solution programs continue to drive
above-market revenue growth, and we continue to leverage that
growth in our operating results, generating both profit and cash
flow above our expectations."

Net sales for the quarter ended Dec. 29, 2006, for the Physician
Business increased by 13.6%, while net sales for the Elder Care
Business decreased by 3.4%.

Income from operations for the quarter ended Dec. 29, 2006, was
$17.9 million compared with income from operations for the quarter
months ended Dec. 30, 2005, of $20.6 million.

Results for the third quarter of fiscal year 2007 included a
$7.1 million write-down of influenza vaccine, resulting from
cancellation of customer orders due to an oversupply of vaccine in
the market and, to date, a mild flu season.

David M. Bronson, Executive Vice President and Chief Financial
Officer, commented, "Despite continued investment in globally
sourced inventory, the company reported another strong quarter of
cash flow from operations, leading us to raise our goal for the
full year to $65 - $68 million.  Approximately $15 million of cash
was returned to shareholders through share repurchases during the
quarter of about 748,000 shares.  We are generating solid leverage
on our infrastructure resulting in capital expenditures slightly
below our expectations for this year."

At Dec. 29, 2006, the company's balance sheet showed
$787.7 million in total assets, $419.6 million in total
liabilities, and $368.1 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 29, 2006, are available for
free at http://researcharchives.com/t/s?19bb

                         About PSS World

Based in Jacksonville, Florida, PSS World Medical Inc. (NASDAQ:
PSSI) -- http://www.pssworldmedical.com/-- is a national
distributor of medical products to physicians and elder care
providers through its two business units.

                          *     *     *

In August 14, 2006, Standard & Poor's Ratings Services raised its
ratings on PSS World Medical Inc.  The corporate credit rating was
raised to 'BB' from 'BB-'.  The rating outlook is stable.


RAMP SERIES: S&P's Junk Rating on Series 2004-SL3 Class B-2 Certs.
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class B-2
from Residential Asset Mortgage Products Inc. Series 2004-SL3
Trust.  Concurrently, the ratings on class B-2 from RAMP Series
2004-SL2 and class B-1 from RAMP Series 2004-SL3 Trust were
lowered and placed on CreditWatch with negative implications.

At the same time, the ratings on classes B-1 and B-2 from RAMP
Series 2003-SL1 Trust and the rating on class B-1 from RAMP Series
2004-SL2 Trust were placed on CreditWatch negative.

Lastly, the ratings on the remaining classes from various RAMP
Trust transactions, including those mentioned above, were
affirmed.  RAMP is an affiliate of Residential Funding Corp.

The lowered ratings and negative CreditWatch placements reflect
recent collateral performance that has eroded the available credit
support for these transactions.  During the past two remittance
periods, RAMP Series 2004-SL2 Trust has experienced $95,120 in
realized losses, which has reduced available credit support to
$195,018 for class B-2.  During the January 2007 remittance
period, $5.50 million in loans were categorized as severely
delinquent.  RAMP Series 2004-SL3 Trust experienced a net loss of
$148,580, causing a $29,226 principal write-down to class B-2.
In addition, the available credit support for class B-1 has been
reduced to $74,183.  RAMP Series 2004-SL3 Trust has $1.965 million
in loans that are severely delinquent.

The CreditWatch placements affecting the ratings on classes B-1
and B-2 from RAMP Series 2003-SL1 Trust reflect the amount of
loans that are severely delinquent compared with the available
credit support.  The deal has $2.4 million in severe
delinquencies, an amount that is significantly more than each
class' available credit support: $440,482 for class B-1 and
$175,656 for class B-2.

Standard & Poor's will continue to closely monitor the performance
of these transactions.  If delinquencies translate into losses,
S&P will take further negative rating actions.

Conversely, if delinquency performance improves, S&P will affirm
the ratings and remove them from CreditWatch.

The affirmations are based on credit support percentages that are
sufficient to maintain the current ratings.

Credit support for the RAMP transactions, with the exception of
those with a seasoned loan designation, is generally provided by
subordination, excess spread, and overcollateralization.  These
specific RAMP SL transactions are supported solely by
subordination.

The underlying collateral for these transactions consists of
fixed- or adjustable-rate, first- or second-lien loans secured
primarily by one- to four-family residential properties.

                         Rating Lowered

                           RAMP Trust
         Mortgage Asset-Backed Pass-Through Certificates

                                       Rating
                                       ------
            Series      Class    To               From
            ------      -----    --               ----
            2004-SL3    B-2      CCC              B+

        Ratings Lowered And Placed On Creditwatch Negative

                           RAMP Trust
         Mortgage Asset-Backed Pass-Through Certificates

                                      Rating
                                      ------
           Series      Class    To               From
           ------      -----    --               ----
           2004-SL2    B-2      B/Watch Neg      BB
           2004-SL3    B-1      B/Watch Neg      BB

               Ratings Placed On Creditwatch Negative

                           RAMP Trust
         Mortgage Asset-Backed Pass-Through Certificates

                                      Rating
                                      ------
           Series      Class    To               From
           ------      -----    --               ----
           2003-SL1    B-1      A-/Watch Neg     A-
           2003-SL1    B-2      BB/Watch Neg     BB
           2004-SL2    B-1      BBB+/Watch Neg   BBB+

                         Ratings Affirmed

                            RAMP Trust
         Mortgage Asset-Backed Pass-Through Certificates

       Series     Class                             Rating
       ------     -----                             ------
       2002-SL1   A-I-3, A-I-IO, A-II-1             AAA
       2002-SL1   A-II-2, A-II-3, A-II-4, M-I-1     AAA
       2002-SL1   M-I-2                             A
       2002-SL1   M-I-3                             BBB
       2003-SL1   A-I-1, A-II-1, A-III-1            AAA
       2003-SL1   A-IV-1, A-I-IO, A-I-PO            AAA
       2003-SL1   A-IO, A-PO                        AAA
       2003-SL1   M-1, M-2                          AA+
       2003-SL1   M-3                               AA
       2004-KR1   A-I-2                             AAA
       2004-KR1   M-II-1                            AA+
       2004-KR1   M-I-1                             AA
       2004-KR1   M-II-2                            A+
       2004-KR1   M-I-2                             A
       2004-KR1   M-I-3                             A-
       2004-KR1   M-I-4                             BBB+
       2004-KR1   M-I-5, M-II-3                     BBB
       2004-KR1   M-I-6                             BBB-
       2004-KR2   A-I-2, A-II-2                     AAA
       2004-KR2   M-I-1, M-II-1                     AA
       2004-KR2   M-I-2, M-II-2                     A
       2004-KR2   M-I-3                             A-
       2004-KR2   M-I-4                             BBB+
       2004-KR2   M-I-5, M-II-3                     BBB
       2004-SL1   A-I-1, A-I-2, A-II, A-III         AAA
       2004-SL1   A-IV, A-V, A-VI, A-VII, A-VIII    AAA
       2004-SL1   A-IX, A-PO, A-IO-1, A-IO-2        AAA
       2004-SL1   M-I-1, M-II-1                     AA
       2004-SL1   M-I-2                             A+
       2004-SL1   M-I-3, M-II-2                     A
       2004-SL1   M-I-4                             A-
       2004-SL1   M-I-5                             BBB+
       2004-SL1   M-I-6, M-II-3                     BBB
       2004-SL1   M-I-7                             BBB-
       2004-SL1   B-II-1                            BB
       2004-SL1   B-II-2                            B
       2004-SL2   A-I, A-II, A-III, A-IV, A-I-IO    AAA
       2004-SL2   A-I-PO, A-IO, A-PO                AAA
       2004-SL2   M-1                               AA+
       2004-SL2   M-2                               AA
       2004-SL2   M-3                               A+
       2004-SL3   A-I, A-II, A-III, A-IV, A-I-IO    AAA
       2004-SL3   A-I-PO, A-IO, A-PO                AAA
       2004-SL3   M-1                               AA+
       2004-SL3   M-2                               A
       2004-SL3   M-3                               BBB
       2004-SL4   A-I, A-II, A-III, A-IV, A-V       AAA
       2004-SL4   A-IO, A-PO                        AAA
       2004-SL4   M-1                               AA
       2004-SL4   M-2                               A
       2004-SL4   M-3                               BBB
       2004-SL4   B-1                               BB
       2004-SL4   B-2                               B
       2005-EFC1  A-I-1, A-I-2, A-I-3, A-I-4        AAA
       2005-EFC1  A-II                              AAA
       2005-EFC1  M-1                               AA+
       2005-EFC1  M-2                               AA
       2005-EFC1  M-3                               AA-
       2005-EFC1  M-4                               A+
       2005-EFC1  M-5                               A
       2005-EFC1  M-6                               A-
       2005-EFC1  M-7                               BBB+
       2005-EFC1  M-8                               BBB
       2005-EFC1  M-9                               BBB-
       2005-EFC1  B-1                               BB+
       2005-EFC1  B-2                               BB
       2005-EFC2  A-1, A-2, A-3                     AAA
       2005-EFC2  M-1                               AA+
       2005-EFC2  M-2                               AA
       2005-EFC2  M-3, M-4                          AA-
       2005-EFC2  M-5                               A+
       2005-EFC2  M-6                               A
       2005-EFC2  M-7                               A-
       2005-EFC2  M-8                               BBB+
       2005-EFC2  M-9                               BBB
       2005-EFC2  M-10                              BBB-
       2005-EFC3  A-I-1, A-I-2, A-I-3, A-II         AAA
       2005-EFC3  M-1, M-2                          AA+
       2005-EFC3  M-3                               AA
       2005-EFC3  M-4                               AA-
       2005-EFC3  M-5                               A+
       2005-EFC3  M-6                               A
       2005-EFC3  M-7                               A-
       2005-EFC3  M-8                               BBB+
       2005-EFC3  M-9                               BBB
       2005-EFC3  M-10                              BBB-
       2005-EFC4  A-1, A-2, A-3                     AAA
       2005-EFC4  M-1, M-2                          AA+
       2005-EFC4  M-3                               AA
       2005-EFC4  M-4                               AA-
       2005-EFC4  M-5                               A+
       2005-EFC4  M-6                               A
       2005-EFC4  M-7                               A-
       2005-EFC4  M-8                               BBB+
       2005-EFC4  M-9                               BBB
       2005-EFC4  M-10                              BBB-
       2005-EFC5  A-1, A-2, A-3, M-1                AAA
       2005-EFC5  M-2, M-3                          AA+
       2005-EFC5  M-4                               AA
       2005-EFC5  M-5                               AA-
       2005-EFC5  M-6                               A+
       2005-EFC5  M-7                               A
       2005-EFC5  M-8                               A-
       2005-EFC5  M-9                               BBB
       2005-EFC5  M-10                              BBB-
       2005-EFC6  A-I-1, A-I-2, A-I-3, A-II         AAA
       2005-EFC6  M-1, M-2, M-3                     AA+
       2005-EFC6  M-4, M-5                          AA
       2005-EFC6  M-6                               A+
       2005-EFC6  M-7                               A
       2005-EFC6  M-8                               BBB+
       2005-EFC6  M-9                               BBB
       2005-EFC7  A-I-1, A-I-2, A-I-3, A-I-4        AAA
       2005-EFC7  A-II                              AAA
       2005-NC1   A-I-1, A-I-2, A-I-3, A-I-4        AAA
       2005-NC1   A-II                              AAA
       2005-SL1   A-I, A-II, A-III, A-IV, A-V       AAA
       2005-SL1   A-VI, A-VII, A-IO, A-PO           AAA
       2005-SL2   A-I, A-II, A-III, A-IV, A-V       AAA
       2005-SL2   A-IO, A-PO                        AAA
       2005-SL2   M-1                               AA
       2005-SL2   M-2                               A
       2005-SL2   M-3                               BBB
       2005-SL2   B-1                               BB
       2005-SL2   B-2                               B
       2006-EFC1  A-1, A-2, A-3                     AAA
       2006-EFC1  M-1                               AA+
       2006-EFC1  M-2                               AA+
       2006-EFC1  M-3                               AA
       2006-EFC1  M-4                               AA-
       2006-EFC1  M-5                               A+
       2006-EFC1  M-6                               A
       2006-EFC1  M-7                               A-
       2006-EFC1  M-8                               BBB
       2006-EFC1  M-9                               BBB-
       2006-EFC2  A-1, A-2, A-3, A-4                AAA
       2006-EFC2  M-1S                              AA+
       2006-EFC2  M-2S                              AA
       2006-EFC2  M-3S                              AA-
       2006-EFC2  M-4                               A+
       2006-EFC2  M-5                               A
       2006-EFC2  M-6                               A-
       2006-EFC2  M-7                               BBB+
       2006-EFC2  M-8                               BBB
       2006-EFC2  M-9                               BBB-
       2006-EFC2  B                                 BB+
       2006-NC1   A-1, A-2, A-3                     AAA
       2006-NC1   M-1                               AA+
       2006-NC1   M-2, M-3, M-4                     AA
       2006-NC1   M-5                               A+
       2006-NC1   M-6                               A
       2006-NC1   M-7                               A-
       2006-NC1   M-8                               BBB+
       2006-NC1   M-9                               BBB-
       2006-NC2   A-1, A-2, A-3                     AAA
       2006-NC2   M-1                               AA+
       2006-NC2   M-2, M-3                          AA
       2006-NC2   M-4                               AA-
       2006-NC2   M-5                               A+
       2006-NC2   M-6                               A
       2006-NC2   M-7                               A-
       2006-NC2   M-8                               BBB
       2006-NC2   M-9                               BBB-
       2006-NC2   B-1                               BB+
       2006-NC3   A-1, A-2, A-3                     AAA
       2006-NC3   M-1                               AA+
       2006-NC3   M-2, M-3                          AA
       2006-NC3   M-4                               AA-
       2006-NC3   M-5                               A+
       2006-NC3   M-6                               A
       2006-NC3   M-7                               A-
       2006-NC3   M-8                               BBB+
       2006-NC3   M-9                               BBB
       2006-NC3   M-10                              BBB-


READER'S DIGEST: S&P Puts 'B' Rating on $1.46 Billion Facilities
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating and negative outlook to RDA Holding Co., the company
formed by private equity firm Ripplewood Holdings LLC. to purchase
Reader's Digest Association Inc.

At the same time, Standard & Poor's lowered its ratings on
Reader's Digest Association, including lowering the corporate
credit rating to 'B' from 'BB', reflecting the increase in
financial risk resulting from the leveraged acquisition, and
removed the ratings from CreditWatch, where they were placed
with negative implications on Aug. 15, 2006.

The outlook is negative.

Standard & Poor's also assigned a 'B' bank loan rating, with a
recovery rating of '3', to the company's $1.46 billion first-lien
senior secured credit facilities.  The recovery rating indicates
an expected meaningful recovery of principal in the event of a
payment default.  The facilities consist of a $300 million
revolving credit facility due 2013 and a $1.16 billion term loan B
due 2014.

Standard & Poor's also assigned its 'CCC+' bank loan rating to the
company's $750 million senior subordinated notes due 2017.  Pro
forma total debt at Dec. 31, 2006, was $1.91 billion.

"The ratings reflect the company's heightened debt leverage, trend
of lower profitability, and Standard & Poor's expectation of only
modest discretionary cash generation," said Standard & Poor's
credit analyst Hal F. Diamond.

"These factors are minimally offset by its market positions in the
highly competitive publishing and direct marketing businesses."

Standard & Poor's remains concerned about Reader's Digest's
business risk and uncertain long-term growth prospects.


REAL ESTATE: Fitch Rates $20 Million Class B12 Notes at B-
----------------------------------------------------------
Fitch assigns ratings to notes issued by Real Estate Synthetic
Investment Finance Limited Partnership 2007-A and RESI Finance DE
Corporation 2007-A:

   -- $13,004,423,602 class A Risk Band 'AAA';

   -- $131,318,000 class B1 Risk Band 'AA+';

   -- $69,678,000 class B2 Risk Band 'AA-';

   -- $6,699,000 class B3 Floating Rate Notes, Due February 2039
      'AA-';

   -- $26,799,000 class B4 Floating Rate Notes, Due February 2039
      'A+';

   -- $13,399,000 class B5 Floating Rate Notes, Due February 2039
      'A';

   -- $26,799,000 class B6 Floating Rate Notes, Due February 2039
      'A-';

   -- $20,099,000 class B7 Floating Rate Notes, Due February 2039
      'BBB+';

   -- $20,099,000 class B8 Floating Rate Notes, Due February 2039
      'BBB';

   -- $13,399,000 class B9 Floating Rate Notes, Due February 2039
      'BBB-';

   -- $20,099,000 class B10 Floating Rate Notes, Due February 2039
      'BB';

   -- $13,399,000 class B11 Floating Rate Notes, Due February 2039
      'B+'; and

   -- $20,099,000 class B12 Floating Rate Notes, Due February 2039
      'B-'.


REDWOOD CAPITAL: Moody's Rates $250 Million Debentures at Ba2
-------------------------------------------------------------
Moody's Investors Service assigned ratings to five classes of
notes issued by Redwood Capital IX, Ltd.

Moody's Ratings:

   * Ba2 to the $125,000,000 Series 1 Class A Principal At-Risk
     Variable Rate Note due Jan. 9, 2008;

   * Ba2 to the $125,000,000 Series 1 Class B Principal At-Risk
     Variable Rate Note due Jan. 9, 2008;

   * Baa3 to the $18,000,000 Series 1 Class C Principal At-Risk
     Variable Rate Note due Jan. 9, 2008;

   * Ba3 to the $20,000,000 Series 1 Class D Principal At-Risk
     Variable Rate Note due Jan. 9, 2008; and

   * B3 to the $12,000,000 Series 1 Class E Principal At-Risk
     Variable Rate Note due Jan. 9, 2008.

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

The ratings of the Notes are primarily derived from the conclusion
of analyses performed by Moody's of the occurrence probabilities
of earthquakes in California over the risk period covered, as well
as the amounts lost should such events occur.

In addition, the ratings also consider the credit strength of the
swap counterparty, the credit strength of the sponsor, and the
effectiveness of the documentation in conveying the risks inherent
in the structure.


RENAISSANCE HOME: S&P Cuts Ratings on Class B Certificates to BB
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its rating on the class
M-1 asset-backed certificates issued by Renaissance Home Equity
Loan Trust 2002-1 to 'AAA' from 'AA+'.  Concurrently, the 'BBB'
rating on class B from this transaction was placed on CreditWatch
negative.

At the same time, the ratings on the class B certificates from
Renaissance Home Equity Loan Trust's series 2002-2 and 2002-3 were
lowered to 'BB' from 'BBB' and placed on CreditWatch with negative
implications.

Lastly, the ratings were affirmed on the remaining classes from
various Renaissance Home Equity Loan Trust transactions, including
those mentioned above.

The raised rating reflects:

   -- An increased credit support percentage that is currently at
      least 2.50x the loss coverage level associated with the
      raised rating;

   -- Series 2002-1 is currently unable to step down its credit
      support because it is failing its delinquency trigger; and,

   -- The collateral balance for series 2002-1 has paid down to
      less than 15% of its original size, and the senior
      certificates have paid down completely.

The lowered ratings and CreditWatch placements reflect collateral
performance that has caused monthly losses to exceed monthly
excess interest.  This pattern has caused overcollateralization in
the affected securitizations to fall below their respective
targets.  As of the January 2007 remittance period, O/C for series
2002-2 and 2002-3 had fallen to 0.33% and 0.31% of the original
pool balances, respectively, below their targets of 0.5%.

In addition, each of the affected transactions has a notable
percentage of loans in its collateral pool that are severely
delinquent: 25.23% in series 2002-2 and 24.79% in series 2002-3.
In the case of series 2002-1, the amount of O/C has fallen to
$1.153 million, which is below its target of $1.499 million.
Furthermore, approximately $8.530 million in loans are severely
delinquent.

Standard & Poor's will closely monitor the performance of the
transactions with ratings on CreditWatch.  If monthly losses
subside to a point at which they no longer outpace monthly excess
interest, and the level of O/C has not been further compromised,
Standard & Poor's will affirm the ratings and remove them
from CreditWatch.

Conversely, if losses continue to exceed excess interest
cash flow, thereby further stressing O/C, Standard & Poor's will
take additional negative rating actions.

The affirmations reflect sufficient levels of credit support to
maintain the current ratings, despite moderate to high
delinquencies.

Credit support for the transactions is provided by subordination,
excess interest, and overcollateralization. In some cases, the
senior certificates receive additional credit support provided by
a 'AAA' rated bond insurance provider.

The collateral consists of either fixed- or adjustable-rate home
equity first- and second-lien subprime loans secured by one- to
four-family residential properties.

                           Rating Raised

                  Renaissance Home Equity Loan Trust
                     Asset-Backed Certificates

                                       Rating
                                       ------
                 Series    Class   To          From
                 ------    -----   --          ----
                 2002-1    M-1     AAA         AA+

          Ratings Lowered And Placed On Creditwatch Negative

                  Renaissance Home Equity Loan Trust
                      Asset-Backed Certificates

                                        Rating
                                        ------
                Series    Class   To               From
                ------    -----   --               ----
                2002-2    B       BB/Watch Neg     BBB
                2002-3    B       BB/Watch Neg     BBB

                Rating Placed On Creditwatch Negative

                 Renaissance Home Equity Loan Trust
                     Asset-Backed Certificates

                                      Rating
                                      ------
              Series    Class   To               From
              ------    -----   --               ----
              2002-1    B       BBB/Watch Neg    BBB

                         Ratings Affirmed

                 Renaissance Home Equity Loan Trust
                     Asset-Backed Certificates

       Series    Class                                 Rating
       ------    -----                                 ------
       2002-1    M-2                                   A
       2002-2    A                                     AAA
       2002-2    M-1                                   AA
       2002-2    M-2                                   A
       2002-3    *A                                    AAA
       2002-3    M-1                                   AA
       2002-3    M-2                                   A
       2002-4    *A                                    AAA
       2002-4    M-1                                   AA
       2002-4    M-2                                   A
       2002-4    B                                     BBB
       2003-1    *A                                    AAA
       2003-1    M-1                                   AA
       2003-1    M-2                                   A
       2003-1    B-A                                   BBB
       2003-1    B-F                                   BBB
       2003-2    A                                     AAA
       2003-2    M-1                                   AA
       2003-2    M-2A                                  A
       2003-2    M-2F                                  A
       2003-2    M-3                                   BBB+
       2003-2    M-4                                   BBB
       2003-3    A                                     AAA
       2003-3    M-1                                   AA
       2003-3    M-2A, M-2F                            A
       2003-3    M-3                                   A-
       2003-3    M-4                                   BBB+
       2003-3    M-5                                   BBB
       2003-3    M-6                                   BBB-
       2003-4    A-1, A-3                              AAA
       2003-4    M-1                                   AA
       2003-4    M-2A, M-2F                             A
       2003-4    M-3                                   A-
       2003-4    M-4                                   BBB+
       2003-4    M-5                                   BBB
       2003-4    M-6                                   BBB-
       2004-1    AV-1, AV-3                            AAA
       2004-1    M-1                                   AA
       2004-1    M-2                                   A
       2004-1    M-3                                   A-
       2004-1    M-4                                   BBB+
       2004-1    M-5                                   BBB
       2004-1    M-6                                   BBB-
       2004-2    AF-1,*AF-2,*AF-3,*AF-4,*AF-5, *AF-6   AAA
       2004-2    *AV-2, *AV-3                          AAA
       2004-2    M-1                                   AA+
       2004-2    M-2                                   AA
       2004-2    M-3                                   AA-
       2004-2    M-4                                   A+
       2004-2    M-5                                   A
       2004-2    M-6                                   A-
       2004-2    M-7                                   BBB+
       2004-2    M-8                                   BBB
       2004-2    M-9                                   BBB-
       2004-3    *AF-3, *AF-4, *AF-5, *AF-6            AAA
       2004-3    AV-1, AV-2A, AV-2B                    AAA
       2004-3    M-1                                   AA+
       2004-3    M-2                                   AA
       2004-3    M-3                                   AA-
       2004-3    M-4                                   A+
       2004-3    M-5                                   A
       2004-3    M-6                                   A-
       2004-3    M-7                                   BBB+
       2004-3    M-8                                   BBB
       2004-3    M-9                                   BBB-
       2004-4    AF-3, AF-4, AF-5, AF-6                AAA
       2004-4    AV-2, AV-3                            AAA
       2004-4    MF-1                                  AA+
       2004-4    MF-2, MV-1                            AA
       2004-4    MF-3                                  AA-
       2004-4    MF-4                                  A+
       2004-4    MF-5, MV-2                            A
       2004-4    MF-6                                  A-
       2004-4    MF-7                                  BBB+
       2004-4    MF-8, MV-3                            BBB
       2004-4    MF-9, MV-4                            BBB-
       2005-1    AF-2, AF-3, AF-4, AF-5, AF-6          AAA
       2005-1    AV-1, AV-2, AV-3                      AAA
       2005-1    M-1                                   AA+
       2005-1    M-2                                   AA
       2005-1    M-3                                   AA-
       2005-1    M-4                                   A+
       2005-1    M-5                                   A
       2005-1    M-6                                   A-
       2005-1    M-7                                   BBB+
       2005-1    M-8                                   BBB
       2005-1    M-9                                   BBB-
       2005-2    AF-2, AF-3, AF-4, AF-5, AF-6          AAA
       2005-2    AV-1, AV-2, AV-3                      AAA
       2005-2    M-1                                   AA+
       2005-2    M-2                                   AA
       2005-2    M-3                                   AA-
       2005-2    M-4                                   A+
       2005-2    M-5                                   A
       2005-2    M-6                                   A-
       2005-2    M-7                                   BBB+
       2005-2    M-8, N                                BBB
       2005-2    M-9                                   BBB-
       2005-3    AF-1, AF-2, AF-3, AF-4, AF-5, AF-6    AAA
       2005-3    AV-1, AV-2, AV-3                      AAA
       2005-3    M-1, M-2                              AA+
       2005-3    M-3                                   AA
       2005-3    M-4                                   AA-
       2005-3    M-5                                   A+
       2005-3    M-6                                   A
       2005-3    M-7                                   A-
       2005-3    M-8                                   BBB+
       2005-3    M-9                                   BBB-
       2005-3    N                                     BBB
       2005-4    A-1A, A-1F, A-2, A-3, A-4, A-5, A-6   AAA
       2005-4    M1, M2                                AA+
       2005-4    M3, M4                                AA
       2005-4    M5                                    AA-
       2005-4    M6                                    A+
       2005-4    M7                                    A
       2005-4    M8                                    A-
       2005-4    M9                                    BBB
       2005-4    M10                                   BBB-
       2005-4    N                                     BBB
       2006-1    AF-1, AF-2, AF-3, AF-4, AF-5, AF-6    AAA
       2006-1    AV-1, AV-2, AV-3                      AAA
       2006-1    M-1                                   AA+
       2006-1    M-2                                   AA
       2006-1    M-3                                   AA-
       2006-1    M-4                                   A+
       2006-1    M-5                                   A
       2006-1    M-6                                   A-
       2006-1    M-7                                   BBB+
       2006-1    M-8                                   BBB
       2006-1    M-9, M-10,                            BBB-
       2006-2    AF-1, AF-2, AF-3, AF-4, AF-5, AF-6    AAA
       2006-2    AV-1, AV-2, AV-3                      AAA
       2006-2    M-1, M-2                              AA+
       2006-2    M-3, M-4                              AA
       2006-2    M-5                                   A+
       2006-2    M-6                                   A
       2006-2    M-7                                   A-
       2006-2    M-8                                   BBB
       2006-2    M-9, M-10                             BBB-

                  *Denotes bond-insured classes.


RESIDENTIAL ASSET: Fitch Rates $5.9MM Class B Certificates at BB+
-----------------------------------------------------------------
Residential Asset Securities Corporation series 2007-KS1, is rated
by Fitch Ratings:

   -- $172.3 million class A-1 'AAA';
   -- $51.4 million class A-2 'AAA';
   -- $79.5 million class A-3 'AAA';
   -- $29.3 million class A-4 'AAA';
   -- $16.1 million class M-1S 'AA+';
   -- $14.4 million class M-2S 'AA+';
   -- $8.5 million class M-3S 'AA+';
   -- $7.8 million class M-4 'AA';
   -- $7.6 million class M-5 'AA-';
   -- $6.8 million class M-6 'A+';
   -- $6.8 million class M-7 'A-';
   -- $4.9 million class M-8 'BBB+';
   -- $4.4 million class M-9 'BBB'; and
   -- $5.9 million privately offered class B 'BB+'.

The 'AAA' rating on the senior certificates reflects the 21.4%
initial credit enhancement provided by 3.8% class M-1S, the 3.4%
class M-2S, the 2% class M-3S, the 1.85% class M-4, the 1.8% class
M-5, the 1.6% class M-6, the 1.6% class M-7, the 1.15% class M-8,
the 1.05% class M-9, the 1.4% privately offered class B, along
with overcollateralization.  The initial and target OC is 1.75%.
In addition, the ratings reflect the strength of the transaction's
legal and financial structures and the attributes of the mortgage
collateral.  The ratings also reflect the strength of the
servicing capabilities represented by Homecomings Financial
Network, Inc., rated 'RPS1' by Fitch, and Residential Funding
Corporation as master servicer.

The collateral pool consists of 2,775 fixed-rate and
adjustable-rate first lien and junior lien mortgage loans and
totals $423,028,360 as of the cut-off date.  The weighted average
original loan to value ratio is 81.78%.  The average outstanding
principal balance is $152,443 the weighted average coupon is
8.4291% and the weighted average remaining term to maturity is
353 months.  75.3% of the loans have prepayment penalties.  The
loans are geographically concentrated in California and Florida.

The loans were sold by RFC to RASC, the depositor.  Prior to
assignment to the depositor, RFC reviewed the underwriting
standards for the mortgage loans and purchased all the mortgage
loans from mortgage collateral sellers who participated in or
whose loans were in substantial conformity with the standards set
forth in RFC's AlterNet program.  The AlterNet program was
established primarily for the purchase of mortgage loans made to
borrowers that may have imperfect credit histories, higher debt to
income ratios or mortgage loans that present certain other risks
to investors.  The depositor, a special purpose corporation,
deposited the loans in the trust, which then issued the
certificates.  For federal income tax purposes, an election will
be made to treat the trust as one or more real estate mortgage
investment conduits.


RESOURCE REAL: Fitch Holds B Rating on $28 Million Class K Notes
----------------------------------------------------------------
Fitch affirms all classes of Resource Real Estate Funding CDO
2006-1 notes as:

   -- $129,370,000 class A-1 floating rate at 'AAA';
   -- $5,000,000 class A-2 FX fixed rate at 'AAA':
   -- $17,420,000 class A-2 FL floating rate at 'AAA';
   -- $6,900,000 class B floating rate at 'AA';
   -- $20,700,000 class C floating rate at 'A+';
   -- $15,520,000 class D floating rate at 'A-';
   -- $20,700,000 class E floating rate at 'BBB+';
   -- $19,830,000 class F floating rate at 'BBB';
   -- $17,250,000 class G floating rate at 'BBB-';
   -- $12,930,000 class H floating rate at 'BBB-';
   -- $14,660,000 class J fixed rate at 'BB'; and,
   -- $28,460,000 class K fixed rate at 'B'.

Deal Summary:

RRE 2006-1 is a revolving commercial real estate cash flow
collateralized debt obligation, which closed on Aug.  10, 2006.
It was incorporated to issue $345,000,000 of floating- and
fixed-rate notes and preferred shares.  As of the Jan.  19, 2007
trustee report, the CDO was invested in a portfolio of commercial
mortgage whole loans and A-notes, B-notes, commercial real estate
mezzanine loans, and cash.  The CDO is also permitted to invest in
real estate-related corporate and bank debt, credit tenant leases,
commercial mortgage-backed securities, and commercial real estate
CDO securities.

The portfolio is selected and monitored by Resource Real Estate,
Inc.  RRE 2006-1 has a five-year reinvestment period, during which
if all reinvestment criteria are satisfied, principal proceeds may
be used to invest in substitute collateral.  The reinvestment
period ends in August 2011.

Asset Manager:

RRE originates, acquires, invests in, and manages a diversified
portfolio of commercial real estate loans and securities,
including whole loans, B-notes, mezzanine loans and CMBS
investments on behalf of Resource Capital Corp., an externally
managed, real estate investment trust.   RRE has approximately
$1 billion of assets under management.   RRE's business lines also
include the resolution of a portfolio of one-off restructured
commercial mortgages acquired between 1991 and 1998; the
sponsorships of private equity funds that invest in stable
multifamily properties on a nationwide basis; and the structuring
and management of tenant-in-common investment interests in real
property.

RRE is a wholly owned subsidiary of Resource America, Inc.  RAI is
a publicly traded specialized asset management company that
manages $13.6 billion in assets as of Dec. 31, 2006, including
23 CDOs within its core competency sectors including financial
institutions, real estate, ABS, syndicated loans and commercial
finance.

Performance Summary:

As of the January 2007 trustee report, the CDO maintains a
significant amount of reinvestment flexibility.  The Fitch
poolwide expected loss is 30.125% compared to a covenant of
51.50%.  This results in an above average cushion of 21.375%.

Since closing, the pool has migrated towards a higher quality pool
of loans, primarily the result of an increased portion of whole
loans as compared to close.  The Fitch stressed loan to value has
decreased to 98.6% from 102.2% and Fitch stressed debt service
coverage, excluding condo conversions, has increased to 1.11x from
1.07x at close.

With the ramp up of nearly 16% of the portfolio, the weighted
average spread has been maintained since close at 3%.  The WAS
remains above the covenant of 2.75%.  The weighted average coupon
has also been stable at 7.8% and remains above the 7% covenant.

Of the pool, 16.9% of the loans are fixed-rate and unhedged and
within the covenants.  The weighted average life has increased
slightly to 2.1 years from 2 years at close, which continues to
imply that the loans will fully turnover during the reinvestment
period.

The over-collateralization ratios of all classes have remained
stable since close while the interest coverage ratios have
improved over the same period.  The improvement in the IC ratios
is attributed to converting cash balances to loan investments.
Both tests are above their covenants as of the January 2007
trustee report.

Although reinvestment cushion is above average, upgrades during
the reinvestment period are unlikely given the pool could still
migrate to the PEL covenant.  The Fitch PEL is a measure of the
hypothetical loss inherent in the pool at the 'AA' stress
environment before taking into account the structural features of
the CDO liabilities.  Fitch PEL encompasses all loan, property,
and poolwide characteristics modeled by Fitch.

Collateral Analysis:

Since close the portfolio has migrated to a higher concentration
of whole loans/A-notes.  During this time, two whole loans/A-
notes, and one mezzanine loan were added to the pool while one
mezzanine loan was paid off.

The portfolio's largest asset type exposure continues to be
hotels, which has increased to 30.9% from 21.65% at close.  The
second largest asset type exposure is retail at 15.26%.  All
property type concentrations are within the covenants.

The pool has below average loan diversity relative to other CRE
CDOs.  The pool currently consists of 22 loans and the Fitch LDI
score is 550, compared to the covenant of 580.  No loan represents
more than 8% of the ramped portfolio.  The CDO is well within all
of its geographic location covenants with the largest exposure
located in New York.


RITE AID: Fitch Junks Rating on $500 Million Senior Notes due 2015
------------------------------------------------------------------
Fitch has assigned ratings to Rite Aid Corporation's new notes:

   -- $300 million senior secured notes due 2017 'BB-/RR1';
   -- $500 million senior unsecured notes due 2015 'CCC+/RR5'.

The proceeds of the new offerings will be used to redeem
$300 million 9.5% senior secured notes due February 2011 and
replenish the $1.75 billion revolving credit facility that was
used to retire the company's $250 million 4.75% convertible notes
due December 2006 and its $185 million 7.125% senior unsecured
notes due January 2007.

In addition, Fitch has affirmed and removed these ratings from
Rating Watch Negative:

Rite Aid:

   -- Issuer Default Rating 'B-';
   -- $1.75 billion bank credit facility 'BB-/RR1';
   -- $558 million 2nd lien senior secured notes 'BB-/RR1';
   -- $906 million senior unsecured notes 'CCC+/RR5'.

Fitch has also downgraded this rating and removed it from Rating
Watch Negative:

The Jean Coutu Group Inc.:

   -- $850 million 8.5% senior subordinated notes to 'CCC-/RR6'
      from 'CCC+/RR5'.

The Rating Outlook is Stable.

The ratings assume that Rite Aid completes its acquisition of
1,858 drug stores from The Jean Coutu Group for $3.4 billion
comprising $1.45 billion in cash, 250 million newly issued Rite
Aid common shares, and the assumption of $850 million senior
subordinated notes.  The ratings also assume that while store
closures are likely, the contribution from these stores will be
less than $60 million of EBITDA, a level which would allow Rite
Aid to terminate the transaction.  The transaction has received
shareholder approval but is still awaiting FTC approval and is
anticipated to close during the first quarter of fiscal 2007.

If the company receives approval and the transaction is completed
as currently anticipated, Fitch expects to rate the company's Rite
Aid's new term loans, which will be used to fund the acquisition,
as:

   -- $1.25 billion term loans 'BB-/RR1'.

These terms loans, along with the revolving credit facility, will
have a first lien on the company's cash, accounts receivable,
investment property, inventory and scrip lists, and is guaranteed
by all U.S. subsidiaries of Rite Aid.  The company's senior
secured notes have a second lien on the same collateral as the
revolver and term loan, and are guaranteed by all Rite Aid and
Jean Coutu domestic subsidiaries.  If Rite Aid does not receive
the necessary regulatory approvals and does not complete the
transaction as anticipated, Fitch will review the company's
operating and capital structure and will adjust the ratings as
appropriate.  In that case, the ratings most likely to change are
the company's senior unsecured notes.

The ratings consider the risk associated with integrating 1,858
Brooks and Eckerd stores with Rite Aid's existing store base and
improving operations at these stores, the higher leverage of about
7x following the completion of the transaction, operating
statistics that trail those of competitors, and the intense
competition in the drug retailing sector.  The ratings also
reflect Rite Aid's operating strategy to focus on its store base
and in-store service levels, the positive demographics of the drug
retailing industry, as well as the benefits from leveraging a
larger store base. Pro forma for the transaction, Rite Aid will
have about 5,000 stores and generate about $28 billion in
revenues.


RITE AID: S&P Puts B+ Rated $300 Mil. Senior Notes on Neg. Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating to
Harrisburg, Pennsylvania-based Rite Aid Corp.'s $300 million
senior secured notes due in 2017 and its 'B-' rating to the
company's $500 million senior unsecured notes due in 2015.

"These ratings are placed on CreditWatch with negative
implications," said Standard & Poor's credit analyst Diane Shand.

All other ratings on Rite Aid, including the 'B+' corporate credit
rating, remain on CreditWatch with negative implications, where
they were placed on Aug. 24, 2006.

The notes offering are being made pursuant to a shelf registration
statement with the SEC.  Proceeds from the offering will be used
to redeem all of Rite Aid's $300 million outstanding 9.5 notes due
February 2011 and for general corporate purposes.  They will also
replenish the company's $1.75 billion revolving credit facility
that was used to retire all of its $250 million outstanding 4.75%
convertible notes due December 2006 and all of its $185 million
outstanding 7.125% senior unsecured notes due January 2007.

Rite Aid's ratings were placed on CreditWatch on Aug. 24, 2006,
after the company said it agreed to acquire all of the U.S.-based
Eckerd and Brooks drugstores from Quebec, Canada-based Jean Coutu
Group Inc. in a transaction valued at about $3.4 billion.
Although the purchase consideration includes 250 million of Rite
Aid common stock, Rite Aid will also finance another $1.45 billion
and assume $850 million of Jean Coutu's long-term debt.

After including Standard & Poor's estimate of the present value of
the acquired operating leases and EBITDA, Rite Aid's leverage is
expected to increase to around 7.5x on a pro forma basis, from
7.0x at the end of 2005.  The increased financial risk and
challenges of integrating the acquired stores could result in a
lower credit rating.

Standard & Poor's review of the rating will also factor in several
positives.  The acquisition should greatly strengthen Rite Aid's
position in the U.S. drugstore industry and make the company a
more formidable competitor against CVS Corp. and Walgreen Co.
Rite Aid will acquire 1,858 drugstores, including 337 Brooks
stores and 1,521 Eckerd stores, all located primarily on the East
Coast and in the Mid-Atlantic states.


RIVERSIDE ENERGY: S&P Holds B Rating, Revises Outlook to Stable
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook to stable
from negative and affirmed its 'B' rating on Rocky Mountain Energy
Center LLC's and Riverside Energy Center LLC's senior secured term
loans due 2011.  Rocky Mountain Energy Center and Riverside Energy
Center are power generation projects that are wholly owned
indirect subsidiaries of Calpine Corporation.

"The outlook revision reflects the diminished risk that the
projects could be adversely affected by the bankruptcy of their
ultimate parent, Calpine Corp.," said Standard & Poor's credit
analyst Michael Scholder.

"At the same time, Standard & Poor's affirmed its '1' recovery
rating on each project's loan, indicating the expectation of full
recovery of all principal in the event of a default," Mr. Scholder
said.

The Riverside Energy Center, located in Beloit, Wisconsin, is a
617 MW natural gas fired, combined-cycle electric generating plant
that sells most of its output to Wisconsin Power & Light Co. and
Madison Gas & Electric Co. under contracts through
mid-2013.

The Rocky Mountain Energy Center, located in Weld County,
Colorado, is a 601 MW natural gas fired, combined-cycle power
generation plant that sells substantially all of its output to
Public Service Co. of Colorado through mid-2014 and up to 90 MW
for the subsequent three and a half years.

The financings for Riverside Energy Center's $368.5 million senior
secured term loan and Rocky Mountain Energy Center's
$264.9 million senior secured term loan are due in 2011.


ROCKY MOUNTAIN: S&P Revises Outlook Despite Calpine's Bankruptcy
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook to stable
from negative and affirmed its 'B' rating on Rocky Mountain Energy
Center LLC's and Riverside Energy Center LLC's senior secured term
loans due 2011.  Rocky Mountain Energy Center and Riverside Energy
Center are power generation projects that are wholly owned
indirect subsidiaries of Calpine Corporation.

"The outlook revision reflects the diminished risk that the
projects could be adversely affected by the bankruptcy of their
ultimate parent, Calpine Corp.," said Standard & Poor's credit
analyst Michael Scholder.

"At the same time, Standard & Poor's affirmed its '1' recovery
rating on each project's loan, indicating the expectation of full
recovery of all principal in the event of a default," Mr. Scholder
said.

The Riverside Energy Center, located in Beloit, Wisconsin, is a
617 MW natural gas fired, combined-cycle electric generating plant
that sells most of its output to Wisconsin Power & Light Co. and
Madison Gas & Electric Co. under contracts through
mid-2013.

The Rocky Mountain Energy Center, located in Weld County,
Colorado, is a 601 MW natural gas fired, combined-cycle power
generation plant that sells substantially all of its output to
Public Service Co. of Colorado through mid-2014 and up to 90 MW
for the subsequent three and a half years.

The financings for Riverside Energy Center's $368.5 million senior
secured term loan and Rocky Mountain Energy Center's
$264.9 million senior secured term loan are due in 2011.


SAINT VINCENTS: Files Plan of Reorganization in New York
--------------------------------------------------------
Saint Vincents Catholic Medical Centers of New York and its
debtor-affiliates has filed a proposed Plan of Reorganization and
Disclosure Statement with the U.S. Bankruptcy Court for the
Southern District of New York.

The proposed Plan of Reorganization seeks to provide an equitable
return to all creditors, including the holders of trade claims,
the Pension Benefit Guaranty Corporation (PBGC -- on account of
the pension plan), and pre-petition medical malpractice claimants,
while providing for the long-term feasibility of the
organization's operations.

"Saint Vincent's restructuring is a visible example of the
challenging healthcare environment that faces all health care
systems in New York, and we are proud to emerge from this process
with a capital structure that allows us to re-invest wisely in our
healthcare mission," Guy Sansone, President, CEO and Chief
Restructuring Officer of Saint Vincents.  "With this plan, we
anticipate emerging from bankruptcy by the middle of 2007 as a
financially sustainable healthcare organization poised to meet the
diverse healthcare needs of New Yorkers and offering the best
environment for our patients, physicians, employees, community,
and other key constituents."

The proposed Plan provides all Saint Vincents creditors who timely
filed claims in the Chapter 11 case with a realistic chance that
their claims will be paid in full over time.

The reorganized Saint Vincents will be focused on a core health
care mission, anchored by St. Vincent's Hospital Manhattan and St.
Vincent's Hospital Westchester, skilled nursing facilities in
Brooklyn and Staten Island, behavioral health and home care
services throughout the Metropolitan area, and sponsorship of the
US Family Health Plan under contract with the Department of
Defense.

In addition to strengthening St. Vincent's on an operational and
financial level, there is a strengthened leadership team.  In late
2006, Alfred E. Smith, IV agreed to chair the board for the
system.  He plans on expanding and reconstituting the board to
build strong new relationships with donors, elected officials, and
our community to benefit all the facilities and programs of the
organization.

Saint Vincents also continues to discuss its desire to meet
modern-day healthcare needs by constructing a new, state-of-the-
art facility after emergence from bankruptcy to better serve its
patients at St. Vincent's Hospital Manhattan.  The goal is to make
sure the hospital is fulfilling its mission and meeting the
healthcare needs of its patients and the community, now and for
years to come.

"Saint Vincents is deeply grateful to all constituents involved
for their participation in a transparent process, including
setting aside individual special interests to reach a
comprehensive solution for all," explained Mr. Sansone.  Those
constituents include the system's Debtor-In-Possession lender, GE
Healthcare Financial Services, the Dormitory Authority of the
State of New York, the City of New York, our labor union partners,
the unsecured creditors, pre-petition medical malpractice
claimants, PBGC, vendors, managed care companies, and most of all
our physicians, nurses, employees and the communities that we
serve.

                          Plan Elements

The core of the Plan is exit financing that will refinance the
existing debtor-in-possession credit facility, provide adequate
funding to the non-union pension plan, and make payments to trade
creditors and prepetition medical malpractice claimants.  Specific
elements of the proposed plan include:

   -- an initial distribution to the trade creditors of at least
      80 cents on the dollar, with a path for them to potentially
      have their claims paid in full over time.

   -- the continuation of Saint Vincents pension plan, keeping
      benefits in place for current employees and retirees.  It
      also provides an approach to meet future funding
      obligations.

   -- a funding schedule for the payment over time of pre-petition
      medical malpractice claims as they are liquidated.

                    The "New" Saint Vincents

Saint Vincents has re-engineered the way it operates its business,
to implement the lessons of fiscal responsibility that it has
learned.  Operational and financial targets will be set for each
operating division.  Discipline will be maintained to meet those
targets, and to ensure the success of the system.  These and other
changes will help restore Saint Vincents as one of New York's
leading healthcare institutions once it emerges from bankruptcy.

Most creditors have maintained relationships with Saint Vincents
throughout the bankruptcy and it expects to continue and grow
relationships with vendors such as Siemens, Cardinal, Aramark, and
Medtronic.

                      About Saint Vincents

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.

The company and six of its affiliates filed for chapter 11
protection on July 5, 2005 (Bankr. S.D.N.Y. Case No. 05-14945
through 05-14951).

Gary Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will
& Emery, LLP, filed the Debtors' chapter 11 cases.  On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors.

As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.


SAINT VINCENTS: Judge Hardin Okays Property Sale to New Prospect
----------------------------------------------------------------
The Honorable Adlai S. Hardin, Jr., of the U.S. Bankruptcy Court
for the Southern District of New York granted the request of Saint
Vincents Catholic Medical Centers of New York and its debtor-
affiliates to sell its real property in Brooklyn to New Prospect
Holding Corporation.

As reported in the Troubled Company Reporter on Dec. 28, 2006, the
Debtors have entered into a contract of sale with New Prospect
Holding Corporation dated Dec. 12, 2006, pursuant to the planned
sale.  Prospect Holding has been selected as the "stalking horse"
for the purposes of the bidding process and auction for the
Properties.  The Debtors agreed to sell certain real property
located at 1482 Prospect Place, Brooklyn, New York, Block 1368,
Lot 16 and 1496-1522 Prospect Place, Brooklyn, New York, Block
1368, Lots 22, 23, 24, 25, 26, 27 and 28 to Prospect Holding
subject to higher and better offers received through a bidding
process and auction.

Andrew M. Troop, Esq., at Weil, Gotshal & Manges LLP, in New
York, relates that the Properties are vacant lots near the former
St. Mary's Hospital, which was closed during the Debtors' Chapter
11 cases.  The Debtors have received authority to sell much of
the real estate on which that hospital had operated to The Backer
Group LLC, which sale is expected to close in the coming weeks.
Because the Properties were not included in the St. Mary's sale,
and the Debtors have no continued use for the Properties, they
are disposing of the Properties through a separate sale.

The Debtors engaged Massey Knakal Realty Services to assist in
locating likely buyers for the Properties beginning in June 2005.
Massey Knakal fielded offers for 1496-1522 Prospect Place from 12
potential purchasers.  Prospect Holding's offer of $2,400,000 was
the highest "as is" offer for that property.

Prospect Holding also expressed an interest in other properties
surrounding St. Mary's, including 1482 Prospect Place, for which
nine bids were received.  Prospect Holding submitted a bid of
$230,000 for 1482 Prospect Place, which was equal to the highest
bid received at that time for that property, and offered a larger
deposit than the other bidders had offered.

The Debtors decided to sell both properties to Prospect Holding
as part of a single transaction.  Following negotiations, Saint
Vincent Catholic Medical Centers entered into the Purchase
Agreement with Prospect Holding.

                    The Purchase Agreement

The Purchase Agreement contemplates that SVCMC will sell and
Prospect Holding will purchase the Properties for the purchase
price of $2,630,000, which will be paid in this manner:

   (i) upon execution of the Purchase Agreement, Prospect Holding
       paid a $131,500 initial downpayment to SVCMC;

  (ii) upon its receipt of written notice from SVCMC that all the
       required approvals have been obtained, Prospect Holding
       will immediately pay to SVCMC a $131,500 supplemental
       downpayment; and

(iii) at the closing of title to the Properties, Prospect
       Holding will pay the remaining $2,367,000 to SVCMC.

SVCMC and Prospect Holding agree that apportionments will be made
between the parties at the Closing, including apportionment of
real estate taxes to the extent applicable.

The Properties are to be sold and purchased subject to certain
permitted exceptions, which will not constitute grounds for
objection by Prospect Holding to the Closing, and SVCMC will have
no obligation to remove any of the Permitted Exceptions as a
condition to Prospect Holding's obligation to purchase the
Properties in accordance with the Purchase Agreement.

The Debtors are requesting that the Properties be sold free of
transfer and similar taxes under Section 1146(c) of the
Bankruptcy Code.  In the event that any taxes are payable by
reason of the Sale of the Properties, the taxes will be paid by
SVCMC.

In the event a transaction with a different qualified bidder is
consummated, Prospect Holding will be entitled to a $70,000
break-up fee and reimbursement of certain de minimis expenses
related to title examination and preparation of a survey.

A full-text copy of the Purchase Agreement is available for free
at http://researcharchives.com/t/s?1790

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, filed the Debtors' chapter 11 cases.  On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors.

As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 46 Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


SERTA: Moody's Junks Rating on $210 Million Senior Facility
-----------------------------------------------------------
Moody's Investors Service assigned a B1 to National Bedding's, dba
Serta, senior secured first lien facility and a Caa1 rating to
Serta's senior secured 2nd lien facility.

At the same time, Moody's downgraded Serta's corporate family
rating and probability of default rating to B2.

The rating outlook is stable.

The 1st and 2nd lien are being amended and restated with the
proceeds to be used to refinance part of the redeemable 12%
preferred stock held by shareholders.

"With this transaction, the company's financial sponsors have
replaced equity capital with senior (secured) debt, but adding
incremental financial risk for creditors in the process" said
Kevin Cassidy, Vice President/Senior Analyst at Moody's.

"[T]he rating downgrades reflect this more aggressive financial
posture and the increase in leverage, which will constrain any
upwards rating momentum in the near term."

However, Mr. Cassidy also stated that "the company's steady cash
flow and expected future focus on delevering provide a buffer
against the uncertainty in consumer spending, high raw material
prices and softness in the housing market that could otherwise
jeopardize projected operating results."

The ratings for both the senior secured 1st lien credit facility,
which is comprised of a $400 million term loan and a $50 million
revolver, and the senior secured 2nd lien facility, reflect both
the overall probability of default of the company and their
respective estimated loss given default assessments of LGD3 and
LGD 5.  Both facilities benefit from the full guarantees of
subsidiaries and an all asset pledge.

Ratings assigned:

   -- $400 million senior secured 1st lien term loan at B1, LGD3,
      33%;

   -- $50 million senior secured revolving credit facility at B1,
      LGD3, 33%; and

   -- $210 million senior secured second lien facility at Caa1,
      LGD5, 84%.

Ratings downgraded:

   -- Corporate family rating to B2 from B1; and
   -- Probability of default rating to B2 from B1.

National Bedding Company, based in Hoffman Estates, Illinois, is a
major manufacturer of mattresses under the Serta brand name.  Net
sales for the LTM period ended September 2006 approximated
$725 million.


SPECIALTY UNDERWRITING: Fitch Cuts Class B-2 Certs. Rating to BB
----------------------------------------------------------------
Fitch has downgraded one class and affirmed 13 classes, one of
which was also removed from Rating Watch Negative, from two
Specialty Underwriting & Residential Finance
asset-backed certificates trusts:

Series 2003-BC1:

   -- Class A affirmed at 'AAA';
   -- Class M-1 affirmed at 'AA+;
   -- Class M-2 affirmed at 'A';
   -- Class B-1 affirmed at 'BBB+'; and
   -- Class B-2 downgraded to 'BB' from 'BBB'.

Series 2005-AB1:

   -- Class A-1A, A-1B, and A-1C affirmed at 'AAA';

   -- Class M1 affirmed at 'AA+';

   -- Class M2 affirmed at 'AA';

   -- Class M3 affirmed at 'A';

   -- Class M4 affirmed at 'A-';

   -- Class B-1 affirmed at 'BBB+';

   -- Class B-2 affirmed at 'BBB-'; and

   -- Class B-3 affirmed at 'BB' and removed from Rating Watch
      Negative.

The collateral for the aforementioned trusts consist primarily of
fixed- and adjustable-rate sub-prime mortgage loans secured by
first or second liens on real properties.  The loans were acquired
by Merrill Lynch Mortgage Lending, Inc.  from various originators
and were originated in accordance with the SURF underwriting
guidelines.  SURF acts as program administrator for the seller,
Merrill Lynch Mortgage Lending, Inc., and its loan acquisition
program facilitates the purchase by Merrill Lynch Mortgage
Lending, Inc.  of eligible nonconforming loans from various SURF-
approved originators.

The affirmations reflect a satisfactory relationship between
credit enhancement and future loss expectations and affect
approximately $184 million of outstanding certificates.  The
downgrade of class B-2 from series 2003-BC1 reflects the
deterioration in the relationship of CE to future loss
expectations and affects $1.2 million in outstanding certificates.

Since Fitch's last review of series 2003-BC1 in October 2006, the
trust suffered four consecutive months in which the excess spread
exceeded monthly collateral losses causing a steady deterioration
of the overcollateralization.  As of the January 2007 remittance
period, the OC is approximately $500,000 less than the OC target.

Class B-3 from series 2005-AB1 was previously placed on Rating
Watch Negative pending expected subsequent recoveries to the trust
due to loans that were requested by SURF to be repurchased by the
seller.  Recoveries were posted to the trust in December 2006 and
the OC was able to build to the target amount.

The servicer for series 2003-BC1 is Litton Loan Servicing.  The
servicer for series 2005-AB1 is Wilshire Credit Corporation.  Both
servicers are rated 'RPS1' by Fitch Ratings, which is the highest
servicer rating available by Fitch.


SPECTRUM BRANDS: Posts $18.8MM Net Loss in Quarter Ended Dec. 31
----------------------------------------------------------------
Spectrum Brands Inc. reported an $18.8 million net loss for the
first quarter ended Dec. 31, 2006, compared with a net income of
$2.3 million for the same period ended Jan. 1, 2006.

Spectrum Brands Inc. reported first quarter net sales of
$564.6 million for the quarter ended Dec. 31, 2006, compared with
first quarter net sales of $566.3 million last year.  Reported net
sales exclude sales from the company's Home & Garden division,
which is being accounted for as discontinued operations pending
completion of an ongoing sale process.

Global battery sales declined six percent year over year, as
strong results from Latin America were offset by sales declines in
North America and Europe/ROW.  Sales of Remington branded products
increased by seven percent on a worldwide basis.  Global Pet
reported growth of four percent.  Favorable foreign exchange rates
had a $16.2 million positive impact on net sales during the
quarter, mostly driven by the strong Euro.

Gross profit and gross margin for the quarter were $208.9 million
and 37.0 percent, respectively, versus $224.0 million and
39.6 percent for the same period last year.  Restructuring and
related charges of $6 million were included in the current
quarter's cost of goods sold; cost of goods sold in the comparable
period last year included $1.3 million in similar charges.
Increased raw material costs, primarily zinc, were the most
significant driver of the decline in gross margin.

The company generated operating income of $37.5 million versus
$67.6 million in fiscal 2006's first quarter.  The primary reasons
for the decline were increased advertising and marketing expense
of approximately $14 million and higher commodity costs, including
an increase of $7 million in zinc costs.

Commenting on the results of the quarter, Spectrum Brands
President and Chief Executive Officer David Jones stated, "Our
first quarter results reflect progress in a number of areas,
despite a challenging environment, and we are confident that we
are taking the right actions for the long-term to build our
brands, reduce costs and create sustainable value.

"We are focused on the successful completion of the divestiture of
our Home & Garden business, a key milestone in the strategic
review we began last July.  We anticipate that the proceeds from
this transaction will enable us to reduce outstanding debt and
leverage and will allow us more flexibility to focus on
strengthening our remaining businesses.  With the assistance of
Goldman Sachs, we are continuing to consider further strategic
options to improve our capital structure, including potential
additional asset sales."

Corporate expenses were $26.6 million as compared to $22.8 million
in the prior year period, primarily attributable to increased
deferred compensation accruals when compared with fiscal 2006,
which included no such accruals.

                      About Spectrum Brands

Headquartered in Atlanta, Georgia, Spectrum Brands (NYSE: SPC)
-- http://www.spectrumbrands.com/-- is a consumer products
company and a supplier of batteries and portable lighting, lawn
and garden care products, specialty pet supplies, shaving and
grooming and personal care products, and household insecticides.
Spectrum Brands' products are sold by the world's top 25
retailers and are available in more than one million stores in
120 countries around the world.  The company has manufacturing
and distribution facilities in China, Australia and New Zealand,
and sales offices in Melbourne, Shanghai, and Singapore.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 11, 2006,
Moody's Investors Service confirmed Spectrum Brands Inc.'s B3
Corporate Family Rating in connection with the rating agency's
implementation of its new Probability-of-Default and Loss-Given-
Default rating methodology.


TECH DATA: Appoints Thomas Morgan to Board of Directors
-------------------------------------------------------
Tech Data Corporation appointed Thomas I. Morgan to its board of
directors.  Mr. Morgan was elected to Tech Data's board, effective
immediately.

Mr. Morgan has successfully led companies in a variety of
industries, including most recently Hughes Supply, Inc., repair
and maintenance products, where he served as chief executive
officer from May 2003 until March 2006 when the company was
purchased by The Home Depot.

Under his leadership, revenues of Hughes Supply expanded from $3
billion to $5.4 billion.  Mr. Morgan joined Hughes Supply in 2001
as president and chief operating officer.  Before that, he served
as chief executive officer of EnfoTrust Network, Value America and
US Office Products.

Mr. Morgan began his career with Genuine Parts Company, where
he held positions of increasing responsibility throughout the
organization.  He concluded his 22-year career with GPC in 1997
serving as executive vice president of S.P. Richards Co., a
$1.1 billion subsidiary of GPC.

Mr. Morgan holds a bachelor's degree in business administration
from the University of Tennessee. He also serves on the boards of
Rayonier, Inc., Waste Management and ITT Educational Services.

"We are pleased to have Thomas Morgan join Tech Data's board
of directors.  His broad operating knowledge coupled with a
track record of accomplished leadership will assist Tech Data's
continued advancement as a technology supply chain leader," said
John Y. Williams, chair of Tech Data's governance and nominating
committee.  "His experience and knowledge of distribution
operations make him a great addition to our board. We look
forward to his contributions."

Founded in 1974, Tech Data Corporation (NASDAQ GS:TECD) --
http://www.techdata.com/-- is a leading distributor of IT
products, with more than 90,000 customers in over 100 countries.
The company's business model enables technology solution
providers, manufacturers and publishers to cost-effectively sell
to and support end users ranging from small-to-midsize businesses
to large enterprises.  Tech Data is ranked 107th on the FORTUNE
500(R).

                           *     *     *

As reported in the Troubled Company Reporter on Dec. 19, 2006,
Moody's Investors Service assigned a Ba2 rating to Tech Data
Corporation's proposed offering of up to $350 million convertible
senior notes due 2026 and affirmed the company's Ba1 corporate
family rating and Ba1 probability of default rating.


THERMA-WAVE: Posts $2.3 Million Net Loss in Quarter Ended Dec. 31
-----------------------------------------------------------------
Therma-Wave Inc. reported a $2.3 million net loss on $18.9 million
of revenues for the third fiscal quarter ended Dec. 31, 2006,
compared with a $3.8 million net loss on $15.4 million of revenues
for the same period ended Jan. 1, 2006.

Boris Lipkin, Therma-Wave's president and chief executive officer,
stated, "The strength of our sequential and year-over-year revenue
growth during the fiscal third quarter of 2007 reflects the
success of our products as well as our ability to meet our
customers evolving needs for next generation advanced metrology
production solutions.

"We are pleased with our bookings for the quarter coming in at
$21.8 million representing a sequential increase of 16%.  As we
move forward with completing the recently announced acquisition
with KLA-Tencor Corporation we continue to focus on delivering to
our customers advanced technology products in the areas of thin
film and optical critical dimension (OCD) metrology. Looking
forward, we feel the proposed integration of Therma-Wave with KLA-
Tencor will extend our latest metrology technologies to our
customer base."

Gross margin for the fiscal third quarter 2007 was 34.5% compared
to 34.8% in the year ago period.

Cash and cash equivalents totaled $14.7 million as of
Dec. 31, 2006, reflecting cash utilization of $2.9 million during
the fiscal third quarter.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?19a7

                          Merger Agreement

On Jan. 8, 2007, Therma-Wave announced that the company signed a
definitive Merger Agreement with KLA-Tencor Corp.  Under the
agreement, KLA-Tencor Corp. agreed to acquire Therma-Wave through
a cash tender offer for $1.65 per share, or approximately $75
million.  The tender offer is scheduled to expire at 12:00
midnight, Eastern Time, on Wednesday, Feb. 14, 2007.

The transaction is subject to customary closing conditions,
including regulatory approvals, and is expected to close by March
31, 2007.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on June 20, 2006,
PricewaterhouseCoopers, LLP, in San Jose, California, raised
substantial doubt about Therma-Wave Inc.'s ability to continue as
a going concern after auditing the company's consolidated
financial statements for the year ended April 2, 2006.  The
auditor pointed to the cCompany's recurring net losses and
negative cash flows from operations.

                         About Therma-Wave

Based in Fremont, California, Therma-Wave Inc. (NASDAQ: TWAV)
-- http://www.thermawave.com/ -- develops, manufactures and
markets process control metrology systems used in the manufacture
of semiconductors.  Therma-Wave offers products to the
semiconductor manufacturing industry for the measurement of
transparent and semi-transparent thin films, for the measurement
of critical dimensions and profile of IC features, and for the
monitoring of ion implantation and activation processes.


THERMADYNE IND: Selling South African Portfolios for $18.2 Million
------------------------------------------------------------------
Thermadyne Industries Inc., a wholly owned subsidiary of
Thermadyne Holdings Corporation, entered into a sale of shares
and claims agreement with Thermaweld Industries Limited.

The effective date of the agreement is Dec. 1, 2006.  Pursuant to
the Agreement, the company agreed to divest these indirect wholly
owned South African subsidiaries as part of the company's
evaluation of its non-core operations:

   -- Maxweld & Braze Pty. Ltd.; and
   -- Thermadyne South Africa Ltd.

Maxweld & Braze and Thermadyne South Africa are wholly owned
subsidiaries of Thermadyne Industries.

The closing of the divestitures is expected to take place in
approximately four to six weeks.

Pursuant to the terms of the agreement, the company agreed to sell
all of the outstanding shares of Maxweld & Braze and Thermadyne
South Africa to the buyer, in exchange for R130,000,000, which
by today's conversion rate is equivalent to approximately
$18.2 million, R100,000,000 of which is payable at closing.

Subject to satisfaction of certain indemnification obligations
pursuant to the terms of the Agreement, the remaining R30,000,000
of the Purchase Price is payable on or before the third
anniversary of the closing date; provided that to the extent such
amount is not paid at closing, it shall accrue interest at the
rate of 14% percent per annum, compounded annually in arrears;
provided further that the maximum amount of the balance, as
adjusted shall not exceed R44,446,000.

The company said that the agreement contains customary
representations and warranties.

Based in St. Louis, Missouri, Thermadyne Holdings Corporation
(Pink Sheets: THMD) -- http://www.Thermadyne.com/-- markets
cutting and welding products and accessories under a variety of
brand names including Victor(R), Tweco(R), Arcair(R), Thermal
Dynamics(R), Thermal Arc(R), Stoody(R), and Cigweld(R).  Its
common shares trade under the symbol THMD.PK.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 30, 2006,
Moody's Investors Service, in connection with the implementation
of its new Probability-of-Default and Loss-Given-Default rating
methodology for the U.S. manufacturing sector, confirmed the Caa1
Corporate Family Rating for Thermadyne Holdings Corporation, as
well as the Caa2 rating on the company's $175 Million 9.25% Senior
Subordinate Notes due Feb. 1, 2014.  Those debentures were
assigned an LGD5 rating suggesting noteholders will experience a
73% loss in the event of default.


TOWER AUTOMOTIVE: Exclusive Plan-Filing Period Extended to Feb. 28
------------------------------------------------------------------
In a bridge order, the Honorable Allen L. Gropper of the U.S.
Bankruptcy Court for the Southern District of New York rules that
Tower Automotive Inc. and its debtor-affiliates' hearing is
adjourned until Feb. 28, 2007.  The Exclusive Periods are extended
through and including Feb. 28, 2007.

The Debtors asked Judge Gropper to further extend, without
prejudice, their exclusive periods to:

   (a) file a plan of reorganization to May 3, 2007; and
   (b) solicit acceptances of that plan to June 29, 2007.

While the Debtors believed that they have made significant
progress in preparing and distributing a draft Chapter 11 Plan to
the Official Committee of Unsecured Creditors, negotiations are
ongoing, Anup Sathy, Esq., at Kirkland & Ellis LLP, in Chicago,
Illinois, told Judge Gropper.  The Debtors stressed that their
ability to formulate a Chapter 11 Plan is predicated upon
obtaining a substantial equity investment, possibly implemented
through a rights offering.

As evidence of the their good faith efforts to negotiate the
terms of an equity investment, late in December 2006, the Debtors
obtained the Court's permission to indemnify and pay fees to
certain investment funds managed by Strategic Value Partners LLC,
Wayzata Investment Partners LLC and Stark Investments pursuant to
a Backstop Commitment Letter and Restructuring Term Sheet, Mr.
Sathy notes.  While the Debtors later withdrew the Term Sheet
Motion after receiving a notice of termination from the Initial
Committed Purchasers, the Debtors continued to evaluate other
alternatives.

Moreover, if the Debtors are unable to locate a suitable
investor, the Debtors may consider alternative exit structures
that would be implemented through a Plan, Mr. Sathy said.  The
Debtors have continued to update the Creditors Committee's
advisors regarding these discussions.

Mr. Sathy maintained that the Debtors' Exclusive Periods should be
extended because:

   (a) The Debtors' Chapter 11 cases are large and complex;

   (b) The Debtors have made considerable progress in their
       Chapter 11 cases, are paying their obligations as they
       come due and are effectively managing their business and
       preserving the value of their assets; and

   (c) The Debtors have been actively working with the Creditors
       Committee and other key parties-in-interest to facilitate
       the Debtors' emergence from bankruptcy as soon as
       possible.

                  Creditors Committee's Objection

The Creditors Committee asked the Court to deny the Debtors'
request for extension because the Debtors have not met their
increased burden of showing that "cause" exists for purposes of
extending their Exclusive Periods for a ninth time.

Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
New York, asserted that the Debtors have not earned another
extension of their Exclusive Periods as the continuance of the
Exclusive Periods will only further impede the reorganization of
the Debtors' Chapter 11 cases, do further damage to the value of
the estates and likely further diminish creditors' recoveries.

Mr. Dizengoff asserted that the Debtors' situation has
significantly deteriorated due to, among other things, the
Debtors' singular focus on a failed equity raise, and is thus
fundamentally different than it was in November 2006, when the
Debtors last sought and received an extension.

The Creditors Committee did not object to the Debtors' prior
requests for extensions of their Exclusive Periods, recognizing
that the Debtors deserved an opportunity to develop an exit
strategy for the Chapter 11 cases, and to formulate a viable Plan
that could be negotiated with the Committee, Mr. Dizengoff said.

As of Jan. 26, 2007, the Debtors have failed to formulate, let
alone file a feasible Plan.  Mr. Dizengoff further asserted that
the draft Plan sent to the Creditors Committee, as the Debtors'
concede, was only a draft that did not contain any of the
substance that would be necessary to even begin plan
negotiations.

The Committee believed that an open process at this juncture -- a
process with no restrictions on the ability of parties-in-
interest to formulate and propose a Plan -- is necessary to
salvage the value of the Debtors' estates for the benefit of
creditors and enable the conclusion of the Debtors' Chapter 11
cases.

As evidence of the Creditors Committee's commitment to, and the
prospects of, an open process, the Committee believed it is close
to finalizing:

   (i) a commitment letter and term sheet with a strategic
       investor seeking to purchase substantially all of the
       Debtors' North American assets; and

  (ii) a plan term sheet based on the proposed sale.

Headquartered in Grand Rapids, Michigan, Tower Automotive Inc.
-- http://www.towerautomotive.com/-- is a global designer and
producer of vehicle structural components and assemblies used by
every major automotive original equipment manufacturer, including
BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan,
Toyota, Volkswagen and Volvo.  Products include body structures
and assemblies, lower vehicle frames and structures, chassis
modules and systems, and suspension components.  The Company and
25 of its debtor-affiliates filed voluntary chapter 11 petitions
on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through
05-10601).  James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq.,
Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet,
Esq., at Kirkland & Ellis, LLP, represent the Debtors in their
restructuring efforts.  Ira S. Dizengoff, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors.  When the Debtors filed for protection from
their creditors, they listed $787,948,000 in total assets and
$1,306,949,000 in total debts.  (Tower Automotive Bankruptcy
News, Issue No. 53; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


TRINSIC INC: Wants to Hire Bankruptcy Services as Claims Agent
--------------------------------------------------------------
Trinsic, Inc. and its debtor-affiliates asks the U.S. Bankruptcy
Court for the Southern District of Alabama for authority to employ
Bankruptcy Services LLC as their notice and claims agent.

Bankruptcy Services will:

   a. prepare and serve required notices in the Debtors'
      bankruptcy cases;

   b. file with the Clerk's Office a certificate or affidavit of
      service within five business days after mailing of a
      particular notice;

   c. maintain copies of all proofs of claims and proofs of
      interest filed;

   d. maintain official claims registers;

   e. implement necessary security measures to ensure the
      completeness and integrity of the claims registers;

   f. transmit to the Clerk's Office a copy of the claims
      register on a weekly basis, unless requested by the Clerk's
      Office on a more or less frequent basis;

   g. maintain an updated mailing list for all entities that have
      filed a proof of claim or interest, which list shall be
      available upon request of a party in interest or the
      Clerk's Office;

   h. provide public access for examintaon of copies of proofs of
      claim or interest without charge during the regular
      business hours;

   i. record all transfers of claims and provide notice of such
      transfers;

   j. comply with applicable federal, state, municipal, and local
      statutes, ordinances, rules, regulations, orders, and other
      requirement;

   k. provide temporary employees to process claims, as
      necessary; and

   l. promptly comply with further conditions and requirements as
      the Clerk's Office or the Court may at any time prescribe.

Documents submitted to the Court did not indicate the Firm's
professional fees.

The Firm is "disinterested" as that term is defined in Section
101(14) of the Bankruptcy Code.

                       About Trinsic Inc.

Based in Tampa, Florida, Trinsic, Inc. and its debtor-affiliates -
- http://www.ztel.com/and http://www.trinsic.com/-- offer
competitive local-exchange carrier services to residential and
business customers.  They lease network assets from incumbent
carriers to offer alternative local and long-distance voice and
data services.  The companies operate 189,000 residential local
access lines and 40,000 business lines.  Trinsic Communications,
Inc. is the principal operating subsidiary of the companies.

Trinsic, Inc. and its debtor-affiliates, Trinsic Communications,
Inc., Touch 1 Communications, Inc., Z-Tel Network Services, Inc.,
and Z-Tel Consumer Services, LLC filed for Chapter 11 protection n
February 7, 2007 (Bankr. S.D. Ala. Case No. 07-10320 through 07-
10324).  Christopher S. Strickland, Esq., at Levine, Block &
Strickland, LLP, and Donald M. Wright, Esq., at Sirote & Permutt,
P.C., represent the Debtors in their restructuring efforts.  When
Trinsic, Inc. filed for protection from its creditors, it listed
total assets of $27,581,354 and total liabilities of $48,287,786.


VALENCE TECHNOLOGY: Sells $1 Million Common Stock to West Coast
---------------------------------------------------------------
Valence Technology Inc. sold $1 million of its common stock to
West Coast Venture Capital Inc., an affiliate of Carl E. Berg of
the company's chairman of the board.  The proceeds will be used to
fund corporate operating needs and working capital.

Under the terms of the purchase, the company issued 657,894 shares
of our common stock, par value $0.001 per share, in a private
placement transaction exempt from the registration requirements of
the Securities Act of 1933, as amended, pursuant to Section 4(2)
thereof.

West Coast Venture Capital purchased these shares at $1.52 per
share.  The purchase price per share equaled the closing bid price
of our common stock as of Jan. 31, 2007, the last trading day
prior to the date of the Agreement.

A full-text copy of the letter of agreement is available for free
at http://ResearchArchives.com/t/s?19bd

                       Going Concern Doubt

As reported in the Troubled Company Reporter on July 5, 2006,
Deloitte & Touche LLP expressed substantial doubt about Valence's
ability to continue as a going concern after auditing the
Company's financial statements for the fiscal year ending March 3,
2006.  Deloitte & Touche pointed to the Company's recurring losses
from operations, negative cash flows from operations and net
stockholders' capital deficiency.

                        About Valence

Headquartered in Austin, Texas, Valence Technology, Inc., --
http://www.valence.com/-- develops and markets battery systems
using Saphion(R) technology, the industry's first commercially
available, safe, large-format Lithium-ion rechargeable battery
technology.  Valence Technology holds an extensive, worldwide
portfolio of issued and pending patents relating to its Saphion
technology and lithium-ion rechargeable batteries.  The company
has facilities in Texas, Las Vegas, Nevada, and Suzhou and
Shanghai, China.


VERSO PAPER: S&P Cuts Corporate Credit Rating to B from B+
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Verso Paper Holdings LLC to 'B' from 'B+'.

At the same time Standard & Poor's assigned a 'B' corporate credit
rating to Verso's parent company Verso Paper Finance Holdings LLC
and a 'CCC+' rating to Verso Finance's proposed $250 million
senior unsecured loan due 2013, based on preliminary terms and
conditions.

The outlook is stable on both companies.

Proceeds from the loan will be used to pay a dividend to Apollo
Management, Verso's equity sponsor.  The rating on the new loan is
two notches below the corporate credit rating and reflects the
instrument's structural subordination.

"The downgrade reflects Verso's weaker financial risk profile as a
result of the new debt issue at Verso Finance, which increases
total debt on a pro forma basis to $1.4 billion," said
Standard & Poor's credit analyst John Kennedy.

"Prior to this action our ratings recognized the company's
initially high leverage but also incorporated expectations that
Verso would use free cash flow during 2006, a period of relatively
favorable industry conditions, to reduce debt.  However, the
additional leverage stemming from the new term loan and the now
weaker price environment will make it challenging for the
company to achieve those expectations.  Also, we believe this
debt-financed distribution to the equity holders reflects a more
aggressive financial policy that is inconsistent with a 'B+'
corporate credit rating."

Verso, based in Memphis, Tennessee, is the leading coated
groundwood paper producer in North America.

Reasonable near-term prospects for coated-paper markets should
allow Verso to generate free cash flow.  However, the company's
capital structure will continue to be very aggressive because of
its heavy debt burden.  In addition, limited organic growth
opportunities exist in North America's highly cyclical and
competitive coated-paper industry.

"We could revise the outlook to negative if a significant industry
downturn occurred and resulted in weaker financial metrics or
strained liquidity or if the company's debt levels increased,"
Mr. Kennedy said.

"We are less likely to revise the outlook to positive because of
the company's very aggressive financial policies."


VESTA INSURANCE: XL Files Adversary Proceeding on Insurance Policy
------------------------------------------------------------------
XL Specialty Insurance Company seeks a judgment from the U.S.
Bankruptcy Court for the Northern District of Alabama declaring
that, pursuant to the express wishes of certain of Vesta Insurance
Group Inc.'s directors and officers, it should not cancel the
extension of a policy it issued to Vesta.

XL Specialty issued to Vesta a Management Liability and Company
Reimbursement Policy No. ELU 090835-05 for the claims-made policy
period December 31, 2005 to December 31, 2006, with an extension
period of December 31, 2006 to December 31, 2007.  The maximum
aggregate Limit of Liability for such coverage is $25,000,000.

On August 4, 2006, Vesta exercised its right to purchase an
extension of the coverage provided by the Policy.  Vesta paid an
additional $1,250,000 in premium for the extension.  Pursuant to
the terms of the Policy, the extension changes the Policy
Expiration Date to December 31, 2007, which means that the
Policy, subject to its terms and conditions, provides coverage
for any claims for a Wrongful Act, Company Wrongful Act or
Employment Practices Wrongful Act made on or before December 31,
2007.

Lloyd T. Whitaker, the Plan Trustee for Vesta under its Third
Amended Chapter 11 Plan of Liquidation, has requested that XL
cancel the extension and return the premium.

On the other hand, former Vesta Directors and Officers David W.
Lacefield; Norman Gayle III; Michael J. Gough; Owen Vickers; and
Alan Farrior, who are entitled to reimbursement of defense
expenses under the Policy, have requested that XL keep the
extension in place.  Messrs. Lacefield and Gayle were chief
executive officers and members of Vesta's Board of Directors.
Messrs. Gough, Vicker, and Farrior were members of Vesta's Board.

In view of these competing demands by the Plan Trustee and the
Officers, XL has commenced the adversary proceeding to seek a
judicial resolution of this issue.

Representing XL, Jennifer A. Harris, Esq., at Burr & Forman, LLP,
in Birmingham, Alabama, nonetheless, asserts that the XL Policy
makes clear through the priority of payments provision that its
primary purpose is the protection of Vesta's directors and
officers.  As a result, the preference of the Officers should
control, she says.

Accordingly, Ms. Harris asserts, XL is entitled to a declaration
that it may not cancel the extension.

                       About Vesta Insurance

Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.

Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517).  Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors.  In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.

J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers.  The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts.   In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.

On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.  (Vesta
Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


VESTA INSURANCE: XL Insurance Wants Stay Lifted to Pay Legal Fees
-----------------------------------------------------------------
XL Insurance Company again seeks relief from the automatic stay,
to the extent applicable, to advance or pay certain legal fees
and expenses to certain directors and officers of Vesta Insurance
Group Inc. or its subsidiaries, under a directors and officers
liability policy issued by XL to Vesta.

Jennifer A. Harris, Esq., at Burr & Forman, LLP, in Birmingham,
Alabama, relates that since XL presented its initial request
before the U.S. Bankruptcy Court for the Northern District of
Alabama, it has received a substantial amount of correspondence
from directors and officers of Vesta or its subsidiaries
requesting coverage under Management Liability and Company
Reimbursement Policy No. ELU 090835-05, issued to Vesta for the
claims-made policy period Dec. 31, 2005 to Dec. 31, 2006, with an
extension period of Dec. 31, 2006, to Dec. 31, 2007.  More than 30
directors and officers of Vesta and its subsidiaries have either
written directly to XL or been the subject of one or more demand
letters, or in one instance, a lawsuit against them.

On Dec. 8, 2006, the Bankruptcy Court entered an order permitting
XL to advance defense expenses to certain directors and officers
in the Luther S. Pate v. David W. Lacefield, et al., Civil Action
No. CV-06-4257 pending before the Circuit Court of Jefferson
County, Alabama, up to and including those incurred on November
29, 2006, and to advance Defense Expenses to defendants David
Lacefield and Norman Gayle incurred in connection with their Rule
2004 Examinations.

XL is now seeking leave to commence advancement of Defense
Expenses to the Directors and Officers from whom it has received
notice.  Ms. Harris tells the Bankruptcy Court that advancement
is necessary to investigate and respond to notices; to defend the
lawsuit titled Affirmative Insurance Holdings, Inc., et al. v.
Hopson B. Nance, et al.; and to defend any other lawsuits against
the directors and officers that may arise out of the demand
letters, which include significant demands for monetary damages.

The advancement will remain subject to a reservation of all
rights and defenses available to XL Specialty under the XL Policy
and applicable law.  The individual insured persons will also
execute a written undertaking to repay any amounts advanced if it
is ultimately determined that the amounts are not covered under
the XL Policy, Ms. Harris says.

The XL Policy's priority of payments provision subordinates the
indemnification payments under Insuring Agreement B, and
securities claim payments under Insuring Agreement C, to payments
to the directors and officers under Insuring Agreement A.

Ms. Harris notes that the Bankruptcy Court is not required to
determine whether or not the policy proceeds are property of the
estate.  XL merely seeks relief from the stay for the purposes of
advancing reasonable fees, costs and expenses incurred by or on
behalf of the individual Insured Persons.

               Officers Seek Payment of Expenses

Alan Farrior; Mr. Gayle; Michael Gough; Owen Vickers; Donald
Thornton; Robert Batlivala; Ehney Camp, III; Walter Beale, Jr.;
Steve Windom; and Thomas Chana are current and former officers or
directors of Vesta or J. Gordon Gaines, Inc.

Messrs. Farrior, Gayle, Gough and Vickers are defendants in the
Pate Action.  The Bankruptcy Court has stayed the proceedings in
the Pate Action and the plaintiff is currently appealing the
decision.

Mitchell D. Greggs, Esq., at Lightfoot, Franklin & White, L.L.C.,
in Birmingham, Alabama, states that the demands from various
entities claiming damages arising from the directors and
officers' actions create an immediate threat of litigation
against the interested parties.

Mr. Greggs asserts that XL Specialty's request pay the directors
and officers' defense expenses under the terms of the Policy
should be approved, as the payments are intended to provide a
direct benefit to the individual directors and officers.

"The interested parties will suffer substantial harm if they are
prevented from recovering defense costs in the face of current
and imminent litigation, because they will be unable to mount an
effective defense," Mr. Greggs tells the Bankruptcy Court.  The
directors and officers need the proceeds now in order to defend
against ongoing and imminent claims for which the XL Policy
provides coverage, he adds.

                       About Vesta Insurance

Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.

Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517).  Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors.  In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.

J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers.  The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts.   In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.

On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.  (Vesta
Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


VICORP RESTAURANTS: Posts $6.1 Million Net Loss for 4th Qtr. 2006
-----------------------------------------------------------------
In its financial results for the fourth fiscal quarter ended
Nov. 2, 2006, VICORP Restaurants Inc. posted a $6.1 million net
loss for the fourth quarter of 2006, compared to a net loss of
$0.6 million in the comparable period of 2005.

Net revenues for the fourth quarter of 2006 were $142.6 million, a
9.7% increase from net revenues of $129.9 million reported in the
fourth quarter of 2005.  The increase in the net revenue resulted
from sales at the 22 new restaurants, net of closures, opened or
acquired throughout fiscal 2006.  Comparable restaurant sales for
the fourth quarter of 2006 declined 3.0% versus the previous
year's fourth quarter.  Comparable restaurant sales for Village
Inn and Bakers Square decreased 2.2% and 3.7%, respectively.

Operating profit was $1.3 million in the fourth quarter of 2006
versus $7.1 million in the fourth quarter of 2005, principally due
to lower restaurant operating profit, as well as higher overhead
expenses, losses on disposition of assets and asset impairments.
Food cost as a percentage of restaurant sales was flat at 25.2% in
the fourth quarter of 2006 versus the comparable period of 2005,
as increased pricing offset increases in commodity costs on a
percentage basis and cost allocations from the pie manufacturing
operations to the restaurants were somewhat lower in the quarter.
Labor costs as a percentage of restaurant sales increased to 34.3%
in 2006 versus 33.4% in the comparable quarter of 2005.  Labor
costs increased as a percentage of restaurant sales partially due
to negative leverage associated with year-over-year store-level
wage increases during a quarter of same store sales decline, as
well as higher percentage labor costs in the significant number of
restaurants opened over recent quarters.

Other operating expenses increased by 2.1 points as a percentage
of restaurant sales primarily due to a 1.7 point increase in rent
expenses in the fourth quarter of 2006.  The increase in
percentage occupancy costs in the fourth quarter of 2006 versus
the comparable period of 2005 was largely a result of negative
leverage associated with normal increases in occupancy costs
relative to the decline in comparable restaurant sales, as well as
higher percentage occupancy costs associated with the immature
newly opened restaurants.

Debra Koenig, CEO, commented, "We are disappointed with the
comparable sales declines in both of our concepts in the fourth
quarter.  We are significantly affected by the sales slump that
has beleaguered many of the restaurant industry's largest casual
dining chains.  This negative sales environment shows no signs of
abating.  Nonetheless, we remain optimistic regarding several
initiatives, including new feature menu offerings, aggressive
pricing and a strong emphasis on store execution.  Despite having
scaled back our new store expansion, we continue to be pleased
with the results of our new store strategy.  During the fourth
quarter, we opened 5 new restaurants, bringing the total for
fiscal 2006 to 27 new restaurants opened or acquired.  In
addition, we have opened 5 new Village Inn locations to date in
fiscal 2007.  In total, we expect to open 9 new Village Inn
restaurants in fiscal 2007."

                    About Vicorp Restaurants

Based in Denver, Colorado, Vicorp Restaurants, Inc. (NASDAQ: VRES)
-- http://www.vicorpinc.com/-- operates and franchises about 400
family-style, medium-priced restaurants in the US -- mainly in
Arizona, California, Florida, the Rocky Mountain region, and the
upper Midwest.  Its restaurant chains include Village Inn, known
primarily for its breakfast menu and pies, and Bakers Square,
serving lunch and dinner and emphasizing fresh-baked pies.  The
company makes all of its pies through VICOM, its bakery production
division, which operates three baking plants.  About 95 of the
restaurants are run by franchisees.  The company is majority owned
by Chicago-based investment firm Wind Point Partners.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 8, 2007,
Standard & Poor's Ratings Services lowered its ratings on VICORP
Restaurants Inc., including the corporate credit rating, to 'B-'
from 'B'.  At the same time, Standard & Poor's also lowered the
rating on the senior unsecured notes to 'CCC+' from 'B-'.  The
notes are rated one notch lower because of the significant amount
of priority debt ahead of the unsecured notes.  The downgrade
reflects continued erosion in the company's credit measures during
2006, as margins and EBITDA deteriorated because of declines in
same-store sales and negative leveraging from higher labor,
manufacturing, and other costs.

The outlook is negative.

Additionally, as reported in the Troubled Company Reporter on Nov.
9, 2006, Moody's Investors Service confirmed the B2 Corporate
Family Rating for Vicorp Restaurants, Inc., and held
its B3 rating on the company's $126.5 million, Guaranteed 10.5%
Senior Unsecured Notes due on April 2011, in connection with the
implementation of its new Probability-of-Default and Loss-Given-
Default rating methodology for the Restaurant sector.  Moody's
assigned an LGD4 rating to those bonds, suggesting noteholders
will experience a 62% loss in the event of a default.


VICORP RESTAURANTS: Posts $7.9 Mil. Net Loss for Fiscal Year 2006
-----------------------------------------------------------------
In its annual financial report for the fiscal year ended Nov. 2,
2006, VICORP Restaurants Inc. reported a $7,871,000 net loss on
$466,308,000 of total revenues for the fiscal year ended Nov. 2,
2006, compared to a net income of $3,463,000 on total revenues of
$439,345,000 for the fiscal year ended Nov. 3, 2005.

At Nov. 2, 2006, the company's balance sheet showed $395,242,000
in total assets and $330,840,000 in total liabilities, resulting
in a $63,347,000 stockholders' equity, compared to total assets of
$412,265,000, total liabilities of $339,331,000, and a
stockholders' equity of $71,871,000 at Nov. 3, 2005.

The company's November 2 balance sheet also showed strained
liquidity with $41,396,000 in total current assets available to
pay $54,084,000 in total current liabilities coming due within the
next 12 months.

                        Increased Costs

Total revenues increased by $27 million, or 6.1%, to $466.3
million in fiscal 2006, from $439.3 million for fiscal 2005.  The
increase was largely due to operating 22 more locations in fiscal
2006 compared to fiscal 2005 offset by seven extra days in fiscal
2005 compared to fiscal 2006.

However, the company experienced a 2.1% decrease in same unit
sales for fiscal 2006 over fiscal 2005.  The company explains that
the majority of its direct competitors have been experiencing
similar declining sales and restaurant analysts believe this is a
result of increasing utility and gas prices being absorbed by
consumers.

Food costs increased by $3.2 million, or 3.0%, to $108.8 million
in fiscal 2006, from $105.6 million for fiscal 2005.  The decrease
was driven primarily by menu price increases exceeding commodity
price increases.  Labor costs increased by $9.9 million, or 7.5%,
to $141.9 million in fiscal 2006, from $132.0 million for fiscal
2005, while labor costs as a percentage of restaurant revenues
increased slightly to 33.4% from 32.4% over these periods.  The
relative increase in labor costs was due to lower operating
efficiency, increased average wage due to minimum wage increases,
negative leverage associated with the same store sales declines
and labor inefficiencies at the new restaurants in start up mode.

Manufacturing operating expenses increased by $10.6 million, or
42.5%, to $35.4 million in fiscal 2006 from $24.8 million for
fiscal 2005.  This increase was primarily due to higher third
party pie sales.  Manufacturing operating expenses as a percentage
of manufacturing revenues increased from 93.1% to 98.0% over these
periods.

A full-text copy of the company's Fiscal 2006 Annual Report is
available for free at http://researcharchives.com/t/s?19bf

                    About Vicorp Restaurants

Based in Denver, Colorado, Vicorp Restaurants, Inc. (NASDAQ: VRES)
-- http://www.vicorpinc.com/-- operates and franchises about 400
family-style, medium-priced restaurants in the US -- mainly in
Arizona, California, Florida, the Rocky Mountain region, and the
upper Midwest.  Its restaurant chains include Village Inn, known
primarily for its breakfast menu and pies, and Bakers Square,
serving lunch and dinner and emphasizing fresh-baked pies.  The
company makes all of its pies through VICOM, its bakery production
division, which operates three baking plants.  About 95 of the
restaurants are run by franchisees.  The company is majority owned
by Chicago-based investment firm Wind Point Partners.

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 8, 2007,
Standard & Poor's Ratings Services lowered its ratings on VICORP
Restaurants Inc., including the corporate credit rating, to 'B-'
from 'B'.  At the same time, Standard & Poor's also lowered the
rating on the senior unsecured notes to 'CCC+' from 'B-'.  The
notes are rated one notch lower because of the significant amount
of priority debt ahead of the unsecured notes.  The downgrade
reflects continued erosion in the company's credit measures during
2006, as margins and EBITDA deteriorated because of declines in
same-store sales and negative leveraging from higher labor,
manufacturing, and other costs.

The outlook is negative.

Additionally, as reported in the Troubled Company Reporter on Nov.
9, 2006, Moody's Investors Service confirmed the B2 Corporate
Family Rating for Vicorp Restaurants, Inc., and held
its B3 rating on the company's $126.5 million, Guaranteed 10.5%
Senior Unsecured Notes due on April 2011, in connection with the
implementation of its new Probability-of-Default and Loss-Given-
Default rating methodology for the Restaurant sector.  Moody's
assigned an LGD4 rating to those bonds, suggesting noteholders
will experience a 62% loss in the event of a default.


VISANT CORP: Moody's Holds Corporate Family Rating at B1
--------------------------------------------------------
Moody's Investors Service changed the outlook of Visant Holding
Corporation to positive from developing.

The outlook change reflects expected improvement in Visant's
credit profile due to both potential debt repayment with proceeds
from the sale of Von Hoffman and strong fundamental operating
performance.  Moody's also affirmed the B1 corporate family rating
and all other ratings for Visant and its operating subsidiary
Visant Corporation.

On Jan. 3, R.R. Donnelley and Sons Company reported the
acquisition of Von Hoffman from Visant for approximately
$413 million in cash.

Moody's would consider a Ba3 corporate family rating with
sustainable leverage of approximately 5x debt-to-EBITDA as well as
sustainable free cash flow-to-debt of approximately 5%, which
Moody's believes Visant could achieve over the next year through a
combination of organic cash flow growth and debt repayment.  The
outlook would likely revert to stable if Moody's anticipated
leverage would remain in the mid to high 5x range due to
substantial, debt financed acquisitions or equity rewards, or a
deterioration of fundamental performance.

Visant's B1 corporate family rating reflects it high leverage,
somewhat aggressive financial policy, and concerns over increasing
competition in the direct marketing space.  Visant's solid and
improving EBITDA margins, good liquidity, and its market leading
position and high customer retention rate in the relatively more
stable Jostens segment supports the rating.  Given its free cash
flow generating capacity and sponsor ownership, the company's
balance between debt reduction, acquisitions, and equity rewards
will continue to influence its ratings.

In Moody's view, Visant's current debt agreements limit the
potential for a meaningful equity return at this time.

However, Moody's remains cognizant of the likelihood of some
return of capital over the intermediate term, noting that the
Visant subordinated discount notes and Visant Corporation
subordinated notes can be redeemed at the end of 2008.

If Visant applies proceeds from Von Hoffman to debt reduction,
Moody's will evaluate ratings on individual securities in
accordance with the Loss Given Default Methodology at that time.
Notching on individual securities could change.

These are the rating actions:

   * Visant Holding Corp.

   -- Outlook, Changed To Positive From Developing
   -- B1 Corporate Family Rating Affirmed
   -- B3 Senior Notes Rating Affirmed

   * Visant Corporation

   -- Ba2 Senior Secured Bank Rating Affirmed
   -- B2 Senior Subordinated Notes Rating Affirmed

Visant, a leading marketing and publishing services enterprise,
services school affinity, direct marketing, fragrance and
cosmetics sampling and educational publishing markets.  The
company maintains headquarters in Armonk, New York, and its annual
revenue is approximately $1.5 billion.


WERNER LADDER: Can File Notices of Removal Until March 7, 2007
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
the deadline for Werner Holding Co. (DE) Inc. aka Werner Ladder
Company and its debtor-affiliates to file notices of removal of
any and all civil actions pending as of their bankruptcy filing
through and including March 7, 2007.

Pursuant to Section 1452 of the Bankruptcy Code and Rules 9006
and 9027 of the Federal Rules of Bankruptcy Procedure, the
Debtors sought the extension without prejudice to:

   (a) any position they may take regarding whether Section 362
       of the Bankruptcy Code applies to stay any given civil
       action pending against them; and

   (b) their right to seek further extensions of the period in
       which they may remove civil actions pursuant to Bankruptcy
       Rule 9027.

Kara Hammond Coyle, Esq., at Young, Conaway, Stargatt & Taylor,
LLP in Wilmington, Delaware, told the Court that since their
bankruptcy filing, the Debtors have been focused on implementing
an operational restructuring plan pursuant to which, they are in
the process of moving over 80% of their unit production to
facilities in Juarez, Mexico, and sourcing their products from
China.

The Debtors have also been working diligently to produce a 2007
operating budget two months earlier than their normal budgeting
process, Ms. Coyle said.

Additionally, the Debtors have been reviewing their operations to
identify, among other things, additional ways to streamline their
business operations, eliminate unprofitable operations, and
increase the profitability of their businesses.  Moreover,
Ms. Coyle attested, the Debtors have been required to respond to
time-consuming diligence requests, litigation and discovery
demands.

Ms. Coyle further said that the Debtors have not had an
opportunity to fully investigate all of the State Court Actions to
determine whether removal is appropriate.  Thus, the requested
extension is necessary to ensure that the Debtors' decisions are
fully informed and consistent with the estates' best interests.

Ms. Coyle assured the Court that the extension would not
prejudice any party to a proceeding, that the Debtors may
ultimately seek to remove, from seeking the remand of the action
under 28 U.S.C. Section 1452(b) at the appropriate time.

Based in Greenville, Pennsylvania, Werner Holding Co. (DE) Inc.
aka Werner Ladder Co. -- http://www.wernerladder.com/--  
manufactures and distributes ladders, climbing equipment and
ladder accessories.  The company and three of its affiliates filed
for chapter 11 protection on June 12, 2006 (Bankr. D. Del. Case
No. 06-10578).  The Debtors are represented by the firm of Willkie
Farr & Gallagher LLP as lead counsel and the firm of Young,
Conaway, Stargatt & Taylor LLP as co-counsel.  Rothschild Inc. is
the Debtors' financial advisor.  The Official Committee of
Unsecured Creditors is represented by the firm of Winston & Strawn
LLP as lead counsel and the firm of Greenberg Traurig LLP as co-
counsel.  Jefferies & Company serves as the Creditor Committee's
financial advisor.  At March 31, 2006, the Debtors reported total
assets of $201,042,000 and total debts of $473,447,000.  The
Debtors's exclusive period to file a plan expired on Jan. 15,
2007.  (Werner Ladder Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service Inc. http://bankrupt.com/newsstand/or
215/945-7000)


WERNER LADDER: To Sell Substantially All Assets for $255,750,000
----------------------------------------------------------------
Werner Holding Co. (DE) Inc. has agreed to sell substantially all
of its assets to Black Diamond Capital Management and Brencourt
Advisors, LLC, for approximately $255,750,000 in cash and
contributed first lien debt.

The sale is subject to negotiation of definitive documentation.

Werner said the purchase offer sets certain target dates,
including:

   (a) approval of bid procedures by March 7, 2007,
   (b) an auction, if necessary, by May 1, 2007, and
   (c) a sale hearing on May 7, 2007.

The proposal requires a closing by May 17, 2007, which can be
extended if certain regulatory approvals are required.

BDCM and Brencourt did not specify how much of the $255,750,000
Sale Price is cash and how much is debt, Bloomberg News reports.

"We are very pleased to have entered into this agreement with
[BDCM] and Brencourt, which demonstrates that we are well on our
way to completing our restructuring and positioning our business
to be well capitalized and viable long into the future.  This
agreement substantiates the progress Werner has made with its
operational restructuring and the underlying value of the Werner
franchise," James J. Loughlin, Jr., interim Chief Executive
Officer of Werner, stated in a company press release.

"With this agreement, we expect the business to exit chapter 11
before the end of the second quarter," Mr. Loughlin added.

"We are pleased to have entered into this agreement with
Brencourt and Werner and look forward to continuing our support
of the Werner business," Steven Deckoff, Managing Principal of
BDCM, said.

The Debtors have been focused on implementing an operational
restructuring plan pursuant to which, they are in the process of
moving over 80% of their unit production to facilities in Juarez,
Mexico, and sourcing their products from China.

Founded in 1995, BDCM is an alternative asset management firm
with approximately $10,000,000,000 under management in a
combination of distressed-debt or private equity funds, hedge
funds and structured vehicles.  BDCM has offices in Greenwich,
Connecticut; Lake Forest, Illinois; and London, United Kingdom.

Brencourt was formed in 2001 as a registered investment advisor
to various alternative investment funds.  Brencourt currently
manages approximately $2,000,000,000 in assets and has offices in
both New York and United Kingdom.

                     Investor Group Raises Bid

Following the Debtors' sale agreement with Black Diamond, the Ad
Hoc Committee of Second Lien Claimholders notified the U.S.
Bankruptcy Court for the District of Delaware that the Investor
Group has raised its offer to purchase substantially all of the
Debtors' assets from $175,000,000 to $262,000,000.

The Investor Group's Revised Offer tops the recent $255,750,000
purchase offer from Black Diamond Capital Management LLC and
Brencourt Advisors LLC by $6,000,000.

The Revised Offer, among other things, provides for:

   (1) payment in full, in cash, of outstanding obligations
       under the Court-approved Superpriority DIP Credit and
       Guaranty Agreement and the First Lien Credit Facility;

   (2) payment of the professional fee carve-outs under the
       proposed Second Forbearance Agreement;

   (3) payment of professional fees during the wind-down of the
       Debtors' Chapter 11 cases after closing of the sale,
       which amount is currently estimated to be as much as
       $1,250,000;

   (4) assumption by the buyers of the Debtors' (i) ordinary
       course postpetition liabilities related to vendors, (ii)
       prepetition critical vendor amounts, (iii) obligations
       under customer programs, whether arising before or after
       the Petition Date, (iv) ordinary-course-of-business
       liabilities to employees, and (v) product liability
       claims of ongoing customers as of the Sale Closing; and

   (5) assumption of certain additional liabilities for
       approximately $15,000,000.

The Investor Group have created WH Acquisition Co. (DE), Inc., to
acquire the Debtors' assets.

A full-text copy of the Investor Group's proposed Asset Purchase
Agreement is available at no charge at:

               http://researcharchives.com/t/s?19be

The Debtors expect to file with the Court by Feb. 15, 2007, a
formal request to establish bidding procedures and conduct an
auction, which is currently anticipated to occur on May 1.

The Investor Group consists of holders of secured claims under
the Debtors' first and second lien credit facilities, and holders
of a substantial portion of the Debtors' unsecured 10% Senior
Subordinated Notes.

          Investor Group Offer Vs. BDCM-Brencourt Offer

Representing the Second Lien Committee, James E. O'Neill, Esq.,
at Pachulski Stang Ziehl Young Jones & Weintraub LLP, in
Wilmington, Delaware, tells the Court that after the Investor
Group delivered its original $175,000,000 purchase offer to the
Debtors, the parties entered into substantive negotiations
regarding specific terms of the purchase offer.  For them to
accept the offer, the Debtors require the Investor Group to
deliver:

   (i) a written support of the Official Committee of Unsecured
       Creditors for the purchase offer; and

  (ii) a waiver by the Creditors Committee of any claims against
       certain agents and lenders under the First and Second
       Lien Credit Facilities.

The Investor Group agreed to those terms and submitted a revised
offer to the Debtors on February 1, 2007, which they valued at
approximately $215,000,000.

On the same date, several hours after the Investor Group
delivered the final form of its purchase offer, the Debtors
announced that they received an offer from BDCM and Brencourt
that they valued as a "better offer," Mr. O'Neill relates.

However, Mr. O'Neill notes, the Debtors did not condition their
acceptance of the term sheet on delivery by BDCM and Brencourt of
the Creditors Committee's Written Support and the Waiver.

Mr. O'Neill points out that the BDCM-Brencourt proposal offers
the lenders under the First Lien Credit Facility only equity
securities in the entity that will acquire the Debtors' assets;
unlike the Investor Group's proposal to pay in cash, in full, the
claims of the agent and lenders under that facility.  As a
result, the BDCM-Brencourt Offer to credit bid the First Lien
Credit Facility debt is now "dead on arrival," he asserts.

In addition, the BDCM-Brencourt Offer leaves the Creditors
Committee with claims against the agents and lenders under the
First and Second Lien Credit Facilities, but with no funds to
prosecute those claims, Mr. O'Neill contends.

In contrast, the Investor Group Offer contemplates a settlement
with the Creditors Committee in which unsecured creditors will be
entitled to purchase up to $25,000,000 of the equity in the
entity acquiring the Debtors' assets and a litigation reserve and
wind-down amount would be funded by the Investor Group, in
exchange for allowance of claims.

Thus, Mr. O'Neill maintains, not only is the Investor Group a
$6,000,000,000 higher bid for the Debtors' assets -- it is also
worth million dollars more as a result of the Creditors
Committee's claims settlement.

             Creditors Panel Supports Revised Offer

In its opposition to the Debtors' first forbearance agreement
with Black Diamond Commercial Finance L.L.C., and its response to
the Debtors' recent request to extend their exclusivity periods,
the Creditors Committee reminds the Court that it gave notice
of its conditions to a sale.  With respect to those conditions,
the Investor Group has agreed that:

   (a) the Creditors Committee will be entitled to appoint a
       board member of the Investor Group entity that will
       acquire the Debtors' assets;

   (b) the unsecured creditors will be entitled to acquire up to
       $25,000,000 of equity of that entity;

   (c) there will be a wind-down fund for post-closing
       professional fees; and

   (d) competing bids will be required to provide terms of
       comparable value to unsecured creditors.

Subject to documentation acceptable to the Creditors Committee
and negotiation of certain remaining issues between the parties,
the Creditors Committee supports the Investor Group's Revised
Offer, as well as the sale process under Section 363 of the
Bankruptcy Code.

The Creditors Committee will also consider alternative
transactions, which provide the same or better consideration to
the general unsecured creditors as the Revised Offer.

Based in Greenville, Pennsylvania, Werner Holding Co. (DE) Inc.
aka Werner Ladder Co. -- http://www.wernerladder.com/--  
manufactures and distributes ladders, climbing equipment and
ladder accessories.  The company and three of its affiliates filed
for chapter 11 protection on June 12, 2006 (Bankr. D. Del. Case
No. 06-10578).  The Debtors are represented by the firm of Willkie
Farr & Gallagher LLP as lead counsel and the firm of Young,
Conaway, Stargatt & Taylor LLP as co-counsel.  Rothschild Inc. is
the Debtors' financial advisor.  The Official Committee of
Unsecured Creditors is represented by the firm of Winston & Strawn
LLP as lead counsel and the firm of Greenberg Traurig LLP as co-
counsel.  Jefferies & Company serves as the Creditor Committee's
financial advisor.  At March 31, 2006, the Debtors reported total
assets of $201,042,000 and total debts of $473,447,000.  The
Debtors's exclusive period to file a plan expired on Jan. 15,
2007.  (Werner Ladder Bankruptcy News, Issue Nos. 18 & 19;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/
or 215/945-7000)


WERNER LADDER: Court Moves Exclusive Plan Filing Period to Feb. 15
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
extended Werner Holding Co. (DE) Inc. aka Werner Ladder Company
and its debtor-affiliates' exclusive periods to file a plan of
reorganization until Feb. 15, 2007, and to solicit acceptances of
that plan until Apr. 16, 2007.

However, the Court ruled, the Plan Filing Period will be extended
until March 9, 2007, and the Solicitation Period will be extended
until May 8, 2007, if the Debtors file a motion seeking approval
of:

   (i) bid procedures for the sale of all or substantially all
       of their assets pursuant to Sections 363 and 105 of the
       Bankruptcy Code; and

  (ii) at their sole option, payment of fees and expense
       reimbursement in connection with an exit facility for a
       Plan.

As reported in the Troubled Company Reporter on Jan. 30, 2007, the
Debtors asked the Court to extend their exclusive periods to file
a plan of reorganization through March 9, 2007, and to solicit
acceptances of that plan through May 8, 2007.

The Debtors' exclusive period to file a plan expired on Jan. 15,
2007.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, told the Court that the Debtors' Chapter
11 cases are large and complex, with a prepetition capital
structure that includes two secured prepetition credit facilities,
a public bond issuance, thousands of trade creditors, and several
classes of stock.  He added that the Debtors have prepetition
debts of more than $1,100,000,000 listed on their scheduled
liabilities.

Mr. Brady also told the Court that the Debtors have delivered to
parties-in-interest an operating budget for 2007, and have
recently begun negotiations with their creditors in formulating a
consensual plan of reorganization.

Based in Greenville, Pennsylvania, Werner Holding Co. (DE) Inc.
aka Werner Ladder Co. -- http://www.wernerladder.com/--  
manufactures and distributes ladders, climbing equipment and
ladder accessories.  The company and three of its affiliates filed
for chapter 11 protection on June 12, 2006 (Bankr. D. Del. Case
No. 06-10578).  The Debtors are represented by the firm of Willkie
Farr & Gallagher LLP as lead counsel and the firm of Young,
Conaway, Stargatt & Taylor LLP as co-counsel.  Rothschild Inc. is
the Debtors' financial advisor.  The Official Committee of
Unsecured Creditors is represented by the firm of Winston & Strawn
LLP as lead counsel and the firm of Greenberg Traurig LLP as co-
counsel.  Jefferies & Company serves as the Creditor Committee's
financial advisor.  At March 31, 2006, the Debtors reported total
assets of $201,042,000 and total debts of $473,447,000.  The
Debtors's exclusive period to file a plan expired on Jan. 15,
2007.  (Werner Ladder Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service Inc. http://bankrupt.com/newsstand/or
215/945-7000)


WILLOWBEND NURSERY: Wants to Sell Agricultural Nursery Business
---------------------------------------------------------------
Willowbend Nursery Inc. and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Northern District of Ohio in
Cleveland for authority to sell substantially all of their assets
including 334.17 acres of land for agricultural nursery operation.

The Debtors also seek authority to assume and assign to the buyer
executory contracts and unexpired leases related to the assets for
sale.

For further information regarding the sale, contact the Debtors'
chapter 11 trustee:

   Andrew Suhar, Esq.
   Suhar & Macejko LLC
   1101 Metropolitan Tower
   P.O. Box 1497
   Youngstown, OH 44501
   Tel: (330) 744-9007
   Fax: (330) 744-5857

Mr. Suhar was appointed on Nov. 3, 2006, pursuant to a Court-
approved request of Fifth Third Bank for a chapter 11 trustee in
the Debtors' bankruptcy cases.

Headquartered in Perry, Ohio, Willowbend Nursery, Inc. --
http://www.willowbendnursery.com/-- owns and operates a nursery
and grow quality bareroot plants & shrubs.  The company and its
affiliates filed for chapter 11 protection on Sept. 20, 2006
(Bankr. N.D. Ohio Case No. 06-14353).  When the Debtors filed for
protection from their creditors, they listed estimated assets
between $1 million and $10 million and estimated debts between
$10 million and $50 million.


WINIMO REALTY: Auction on Albany Terminal Set for March 30
----------------------------------------------------------
Cibro Petroleum Products Inc., an affiliate of Winimo Realty
Corp., is selling its terminal and storage facility for ethanol
and petroleum products located at the Port of Albany in New York,
including its lease with the Albany Port District Commission
comprising approximately 33 acres of land.  The Albany Terminal
includes rail facilities, riverfront shipping docks, and storage
tank capacity in excess of 2,000,000 bbl.

The Albany Terminal will be sold thru an auction at 10:00 a.m. on
March 30, 2007, at the offices of Andrews Kurth LLP, 450 Lexington
Avenue in New York.

Cibro Petroleum previously entered into an asset purchase
agreement with Logibio LLC on Dec. 22, 2006.  Logibio will
purchase the Albany Terminal, subject to better offers, for
$6.25 million in cash plus assumption of certain liabilities.

The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York approved the Debtors' bidding
procedures on Jan. 26, 2007.

Copies of the asset purchase agreement, the bidding procedures,
and diligence materials can be obtained from Jonathan Levine,
Esq., at Andrews Kurth LLP at (212) 850-2816.

Judge Drain will conduct a sale hearing at 10:00 a.m. on April 2,
2007.

Winimo Realty Corp., Cibro Petroleum Products Inc., and other
affiliates filed for chapter 11 protection in the U.S. Bankruptcy
Court for the Southern District of New York (jointly administered
under Case No. 92-40026).  Paul N. Silverstein, Esq., and Jonathan
Levine, Esq., at Andres Kurth LLP represent the Debtors.  Steven
M. Golub, Esq., and Remy J. Ferrario, Esq., at Golub & Golub LLP
represent the Official Committee of Unsecured Creditors.


XERIUM TECH: Weak Performance Prompts Moody's Ratings Downgrade
---------------------------------------------------------------
Moody's Investors Service downgraded the long term debt and
corporate family ratings of Xerium Technologies Inc. and
maintained a stable outlook.

In addition, Moody's affirmed Xerium's speculative grade liquidity
rating of SGL-3 due to the recent amendment of its bank credit
facility.

The downgrade reflected Moody's belief that Xerium's operating
performance will remain weak relative to historic norms as
increased competition in its main markets has reduced growth
prospects and pressured margins.  Xerium's customers in North
America and Europe continue to struggle operationally due to a
slowdown in global paper production and significant overcapacity.

Moody's believes that this trend will continue with the closure of
additional mills and further downtime at existing facilities in
North America and Europe, Xerium's main markets.  Moody's also
anticipates that volume losses in 2006 will take longer than
expected to recover and that recent investments in developing
economies will take several years before they have a meaningful
positive impact on cash flow.

In response to the changes in the paper and board industry, Xerium
continues to realign its manufacturing footprint.  The company is
still in the process of rebounding from production inefficiencies
in North America, delays in achieving benefits from cost reduction
initiatives, and a difficult pricing environment for certain of
its products.  Challenges remain in the clothing segment, as the
company has recently experienced losses in market share and volume
in Europe.

At the same time, Xerium's roll covers business has improved due
to an improved market position in North America, offsetting the
flat operating performance within the clothing segment.  Moody's
believes the impact of these factors, coupled with the company's
inability to increase prices, particularly within clothing
products, will continue to negatively affect operating performance
over the next two to three years.  Furthermore, the uncertainty,
variability, and sustainability of the company's free cash flows
better reflect a B2 corporate family rating at this time.

The B2 corporate family rating incorporates the company's sizable
market position and moderate geographic diversity.  However, the
ratings also reflect the limited scope and modest size of the
company's operations in developing countries that hold the
greatest potential for future sales growth.  Xerium's elevated
business risk due to its focus on the paper industry, its
potential for bolt-on acquisitions, high debt levels, lack of
meaningful free cash flow, and potential dividend requirements
constrain the ratings.  Due to Xerium's business risks and limited
product diversity, Moody's would expect the company to generate
stronger credit metrics than many other B2 rated industrial
companies.

On Jan. 20, 2006, Moody's changed Xerium's outlook to negative
from stable due to the same challenges addressed above.
Specifically, Moody's stated that if the company fails to improve
operating performance and fails to generate any free cash flow in
the near term, the ratings could be lowered.  Other factors that
could negatively impact the ratings would be a deterioration in
paper industry fundamentals resulting in a further decline in
paper production, weaker liquidity, or a larger-than-anticipated
debt financed acquisition.  In Moody's opinion, many of these
factors may materialize in the short-term and will continue to
negatively impact the company's financial metrics.  As a result,
the ratings have been lowered.

Downgrades:

   * Xerium Technologies, Inc.

      -- Corporate Family Rating, Downgraded to B2 from B1

      -- Senior Secured Term Loan, Downgraded to B2 from B1

      -- Senior Secured Revolving Credit Facility, Downgraded to
         B2 from B1

      -- Probability of Default Rating, Downgraded to B2 from B1

Outlook Actions:

   * Xerium Technologies, Inc.

      -- Outlook, Changed To Stable From Negative

Xerium Technologies, Inc., headquartered in Youngsville, North
Carolina, is a manufacturer and supplier of consumable products
used primarily in the production of paper.


YUKOS OIL: U.S.-Based Chevron Eyes Bankrupt Assets
--------------------------------------------------
The battle to take over the assets of OAO Yukos Oil Co. is
underway as Chevron Corp. becomes the first U.S. firm to express
an interest in entering the bidding race for the bankrupt Russian
oil producer, according to published reports.

The U.S.-based company joins other global energy investors,
including a consortium comprised of Italy's Eni SpA and Enel SpA,
in the intense competition for Yukos' remaining assets, Greg
Walters of the Wall Street Journal relates.

The remaining assets of what was once Russia's largest oil
producer include refineries and two oil production units.  These
assets, which are due to be liquidated this year, are initially
valued at more than $22 billion as of January 2007.

An unidentified source told Russian daily Vedomosti last month
that the company's final market value could be slightly over
$20 billion, $4 billion short of the total creditor claims
against Yukos.  The sale of Yukos's assets will begin following
the completion of the valuation process this month.

As reported in the Troubled Company Reporter-Europe on Oct. 26,
2006, Yevgeny Neiman, general director of Roseco, one of the five
valuers in the consortium, said Yukos's assets may be sold at a
discount after appraisers complete the valuation of the company's
properties.

"The discount on the liquidation price will depend on which
asset we are valuing.  The discount could be 10 percent or it
could be 90 percent," Mr. Neiman said.

According to WSJ, most observers believe the Kremlin will maintain
tight, though informal, control over the auction proceedings even
amidst promises of an open and fair process from the office of
Yukos liquidator, Eduard Rebgun.  The sale of Yukos' assets will
begin following the completion of the valuation process.

Analysts believe Russian-based Rosneft Oil and Gazprom have the
most advantage in taking over choice assets through the
liquidation sale, WSJ adds.  They also do not discount the
possibility of other bidders, which include Surgutneftegas as a
potential bidder for Tomskneft.

Chevron spokeswoman Irina Rybalchenko declined comment.

In a Troubled Company Reporter-Europe report on Oct. 26, 2006,
Yevgeny Neiman, general director of Roseco, one of the five
valuers in the consortium, said Yukos's assets may be sold at a
discount after appraisers complete the valuation of the
company's properties.

"The discount on the liquidation price will depend on which
asset we are valuing.  The discount could be 10 percent or it
could be 90 percent," he said.

                         About Yukos Oil

Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- is
an open joint stock company existing under the laws of the
Russian Federation.  Yukos is involved in energy industry
substantially through its ownership of its various subsidiaries,
which own or are otherwise entitled to enjoy certain rights to
oil and gas production, refining and marketing assets.

The Company filed for Chapter 11 protection on Dec. 14, 2004
(Bankr. S.D. Tex. Case No. 04-47742), but the case was
dismissed on Feb. 24, 2005, by the Hon. Letitia Z. Clark.

On March 10, 2006, a 14-bank consortium led by Societe Generale
filed a bankruptcy suit in the Moscow Arbitration Court in an
attempt to recover the remainder of a US$1 billion debt under
outstanding loan agreements.  The banks, however, sold the claim
to Rosneft, prompting the Court to replace them with the state-
owned oil company as plaintiff.

On April 13, 2006, court-appointed external manager Eduard
Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court
for the Southern District of New York (Bankr. S.D.N.Y. Case No.
06-0775), in an attempt to halt the sale of Yukos' 53.7%
ownership interest in Lithuanian AB Mazeikiu Nafta.

On May 26, 2006, Yukos signed a $1.49 billion Share Sale and
Purchase Agreement with PKN Orlen S.A., Poland's largest oil
refiner, for its Mazeikiu ownership stake.  The move was made a
day after the Manhattan Court lifted an order barring Yukos from
selling its controlling stake in the Lithuanian oil refinery.

On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration
Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and
declared what was once Russia's biggest oil firm bankrupt.


ZANETT INC: CEO Guazzoni Buys 550,000 Shares for $1.1 Million
-------------------------------------------------------------
Zanett Inc. CEO Claudio Guazzoni has acquired 550,000 shares of
its Common Stock at a price of $2.00 per share, for a total of
$1.1 million.  The shares were purchased from co-founder David
McCarthy in a private transaction.

The company disclosed that it has entered into a lock-up agreement
with Mr. McCarthy on the balance of the shares as of Feb. 1, 2007.
The lock-up agreement prohibited Mr. McCarthy from disposing of
his Zanett common stock shares into the public markets.  The
agreement has a year term, which will expire on Jan. 31, 2008.

"For a while now, I have been thinking that the stock was not
reflecting its proper value," CEO Claudio Guazzoni stated.  "I am
very happy to have increased my holdings at levels that I believe
to be very attractive and profitable for me in the long run.  I am
committed to growing value for all of Zanett's shareholders.

"Zanett was excited by the prospects that 2007 brings.  The
company believed that it was well positioned in the Commercial
well as in the Government Divisions.  In 2006 Zanett achieved
record revenues and realized continued strong cash profitability.
Now Zanett carried this energy into 2007, better positioned than
ever with solid business momentum, possessing positive potential
for organic growth prospects, and equipped with a strong M&A
pipeline."

                        About Zanett Inc.

Headquartered in New York, Zanett Inc. (Nasdaq:ZANE) --
http://www.zanett.com/-- is an information technology company
that provides customized IT solutions to Fortune 500 corporations,
mid-market companies, and classified government agencies involved
in Homeland Defense and Homeland Security.  The company operates
in two segments: Commercial Solutions and Government Solutions.

                      Going Concern Doubt

Deloitte & Touche LLP expressed substantial doubt Zanett's ability
to continue as a going concern after auditing the company's
financial statements for the fiscal year ended Dec. 31, 2005.  The
auditing firm pointed to the company's recurring losses from
operations and working capital deficiency.


* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Upcoming Meetings, Conferences and Seminars

February 2007
   AMERICAN BANKRUPTCY INSTITUTE
      International Insolvency Symposium
         San Juan, Puerto Rico
            Contact: 1-703-739-0800; http://www.abiworld.org/

February 7-9, 2007
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      VALCON: Hedge Funds, Distressed Debt, Risk and
         Restructurings
            Red Rock Casino, Resort and Spa, Las Vegas, NV
               Contact: http://http://www.airacira.org//

February 8, 2007
   INSTITUTIONAL INVESTOR EVENTS
      Corporate Restructuring & Investing in Post-Crisis Latin
         America Forum
            New York, NY
               Contact: http://www.iievents.com/

February 8-11, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Certified Turnaround Professional (CTP) Training
         NY/NJ
            Contact: http://www.turnaround.org/

February 12, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      9th Annual TMA Symposium
         Four Seasons Hotel, Toronto, ON
            Contact: http://www.turnaround.org/

February 14, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Marketing Strategies available to the Turnaround
         Practitioner
            Sydney, Australia
               Contact: http://www.turnaround.org/

February 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      3rd Annual Martini Networking Event
         Gibson's Steakhouse, Chicago, IL
            Contact: 815-469-2935 or http://www.turnaround.org/

February 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Valuation Outlook - What's in Store for 2007
         University Club, Portland, OR
            Contact: http://www.turnaround.org/

February 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Window of Opportunity: Maximizing Value in a Retail
         Bankruptcy
            Denver Athletic Club, Denver, CO
               Contact: http://www.turnaround.org/

February 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Men's College Basketball & Networking
         Wachovia Center, Philadelphia, PA
            Contact: 215-657-5551 or http://www.turnaround.org/

February 16, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Wharton Restructuring Conference
         The Wharton School
            Philadelphia, PA
               Contact: http://www.turnaround.org/

February 20, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Professional Development
         Brisbane, Australia
            Contact: http://www.turnaround.org/

February 21, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Member Appreciation FREE Happy Hour
         Gordon Biersch Brewery Restaurant, Miami, FL
            Contact: 561-882-1331 or http://www.turnaround.org/

February 22, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA PowerPlay - Atlanta Thrashers
         Philips Arena, Atlanta, GA
            Contact: 678-795-8103 or http://www.turnaround.org/

February 22, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA-NOW Networking & Panel: Discussing Women's Networking
         Issues
            PBI, Philadelphia, PA
               Contact: 215-657-5551 or http://www.turnaround.org/

February 25-26, 2007
   NORTON INSTITUTES
      Norton Bankruptcy Litigation Institute
         Marriott Park City, UT
            Contact: http://www2.nortoninstitutes.org

February 27, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Member Appreciation FREE Happy Hour
         Maggianos, Tampa, FL
            Contact: 561-882-1331 or http://www.turnaround.org/

February 27, 2007
   PRACTISING LAW INSTITUTE
      Intercreditor Agreements & Bankruptcy Issues Workshop
         San Francisco, CA
            Contact: www.pli.edu

February 27, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Devil Rays Turnaround
         Centre Club, Tampa, FL
            Contact: http://www.turnaround.org/

February 27-28, 2007
   EUROMONEY INSTITUTIONAL INVESTOR
      5th Annual Corporate Restructuring Summit
         Sheraton Park Lane Hotel, London, UK
            Contact: http://www.euromoneyplc.com/

March 1, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts and Bolts for Young Practitioners - West
         Regency Beverly Wilshire, Los Angeles, CA
            Contact: http://www.abiworld.org/

March 2, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      15th Annual Bankruptcy Battleground West
         Regency Beverly Wilshire, Los Angeles, CA
            Contact: http://www.abiworld.org/

March 6, 2007
   BEARD AUDIO CONFERENCES
      Distressed Claims Trading
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

March 14, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      The Great Debate
         Sydney, Australia
            Contact: http://www.turnaround.org/

March 14-15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Atlanta, GA
         Contact: http://www.turnaround.org/

March 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      LI Turnaround Management Event
         Long Island, NY
            Contact: http://www.turnaround.org/

March 15-18, 2007
   NATIONAL ASSOCIATION OF BANKRUTPCY TRUSTEES
      NABT Spring Seminar
         Ritz-Carlton Buckhead, Atlanta, GA
            Contact: http://www.NABT.com/

March 15, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Martini Madness Cocktail Reception with Geraldine Ferraro
         Westin Buckhead, Atlanta, GA
            Contact: 678-795-8103 or http://www.turnaround.org/

March 20, 2007
   THOMSON WEST LEGALWORKS
      Insurance and Reinsurance Allocation Superbowl
         New York, NY
            Contact: http://www.westlegalworks.com/

March 21, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      The Next Wave of Distressed Businesses: A Panel Discussion
         South Florida
            Contact: http://www.turnaround.org/

March 21, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         TBA, South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

March 27, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      "The Six Keys of Sustained Profitable Growth"
         Rodney Page, Senior Partner of Blue Springs Partners
            Citrus Club, Orlando, FL
               Contact: http://www.turnaround.org/

March 27-31, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Spring Conference
         Four Seasons
            Las Colinas, Dallas, TX
               Contact: http://www.turnaround.org/

March 29-31, 2007
   AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
      Chapter 11 Business Reorganizations
         Scottsdale, AZ
            Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/

April 5, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Case Study "When Everything Goes Wrong"
         University of Florida, Gainesville, FL
            Contact: http://www.turnaround.org/

April 11-15, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      ABI Annual Spring Meeting
         J.W. Marriott, Washington, DC
            Contact: 1-703-739-0800; http://www.abiworld.org/

April 12, 2007
   INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION
      IWIRC 4th Spring Luncheon and Founders Awards
         Washington, DC
            Contact: http://www.iwirc.org/

April 12, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon University Club
      Jacksonville, FL
            Contact: 561-882-1331 or http://www.turnaround.org/

April 12, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts and Bolts for Young Practitioners - East
         JW Marriott, Washington, DC
            Contact: http://www.abiworld.org/

April 19-20, 2007
   BEARD GROUP AND RENAISSANCE AMERICAN CONFERENCES
      Eighth Annual Conference on Healthcare Transactions
         Successful Strategies for Mergers, Acquisitions,
            Divestitures, and Restructurings
               The Millennium Knickerbocker Hotel - Chicago
                  Contact: 800-726-2524;
                  http://renaissanceamerican.com/

April 19, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Wine Tasting Social
         TBA, Long Island, NY
            Contact: 631-251-6296 or http://www.turnaround.org/

April 20, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Breakfast meeting with Chapter President, Bruce Sim
         Westin Buckhead, Atlanta, GA
            Contact: 678-795-8103 or http://www.turnaround.org/

April 24, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      "Why Prospects Become Clients"
         Mark Fitzgerald, President of Sales Training Institute
            Inc
               Centre Club, Tampa, FL
                  Contact: http://www.turnaround.org/

April 26, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Jacksonville Zoo Turnaround
         University Club, Jacksonville, FL
            Contact: http://www.turnaround.org/

April 26, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      1st Annual Credit & Bankruptcy Symposium Golf/Spa Outing
         Fox Hopyard Golf Club, East Haddam, CT
            Contact: 203-265-2048 or http://www.turnaround.org/

April 26, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Spa Outing
         Mohegan Sun, Uncasville, CT
            Contact: 203-265-2048 or http://www.turnaround.org/

April 26-27, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      1st Annual Credit & Bankruptcy Symposium
         Mohegan Sun, Uncasville, CT
            Contact: http://www.turnaround.org/

April 26-28, 2007
   ALI-ABA
      Fundamentals of Bankruptcy Law
         Philadelphia, PA
            Contact: http://www.ali-aba.org

April 29 - May 1, 2007
   INTERNATIONAL BAR ASSOCIATION
      International Insolvency Conference
         Zurich, Switzerland
            Contact: http://www.ibanet.org/

May 4, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts and Bolts for Young Practitioners - NYC
         Alexander Hamilton US Custom House, SDNY
            New York, NY
               Contact: http://www.abiworld.org/

May 7, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      9th Annual New York City Bankruptcy Conference
         Millennium Broadway Hotel & Conference Center
            New York, NY
               Contact: http://www.abiworld.org/

May 14, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Annual TMA Atlanta Golf Outing
         White Columns, Atlanta, GA
            Contact: 678-795-8103 or http://www.turnaround.org/

May 16, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         TBA, South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

May 16, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Bankruptcy Judges Panel
         Marriott North, Fort Lauderdale, FL
            Contact: http://www.turnaround.org/

May 17-18, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      6th Annual Great Lakes Regional Conference
         Renaissance Quail Hollow Resort, Painesville, OH
            Contact: http://www.turnaround.org/

May 24-25, 2007
   BEARD GROUP AND RENAISSANCE AMERICAN CONFERENCES
      Fourth Annual Conference on Distressed Investing Europe
         Maximizing Profits in the European Distressed Debt Market
            Le Meridien Piccadilly Hotel - London, UK
               Contact: 800-726-2524;
               http://renaissanceamerican.com/

May 29, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon - Bankruptcy Judges Panel
         Citrus Club, Orlando, FL
            Contact: http://www.turnaround.org/

May 30-31, 2007
   FINANCIAL RESEARCH ASSOCIATES
      Distressed Debt
         Harvard Club, New York, NY
            Contact: http://www.frallc.com/

June 4-7, 2008
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      24th Annual Bankruptcy & Restructuring Conference
         JW Marriott Spa and Resort, Las Vegas, NV
            Contact: http://http://www.airacira.org//

June 6-8, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      5th Annual Mid-Atlantic Regional Symposium
         Borgata Hotel Casino & Spa
            Atlantic City, NJ
               Contact: http://www.turnaround.org/

June 6-9, 2007
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      23rd Annual Bankruptcy & Restructuring Conference
         Westin River North, Chicago, IL
            Contact: http://www.airacira.org/

June 14-17, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Central States Bankruptcy Workshop
         Grand Traverse Resort, Traverse City, MI
            Contact: 1-703-739-0800; http://www.abiworld.org/

June 21-22, 2007
   BEARD GROUP AND RENAISSANCE AMERICAN CONFERENCES
      Tenth Annual Conference on Corporate Reorganizations
         Successful Strategies for Restructuring Troubled
            Companies
               The Millennium Knickerbocker Hotel - Chicago
                  Contact: 800-726-2524;
                  http://renaissanceamerican.com/

June 26, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon - Bankruptcy Judges Panel
         Centre Club, Tampa, FL
            Contact: http://www.turnaround.org/

June 28 - July 1, 2007
   NORTON INSTITUTES
      Norton Bankruptcy Litigation Institute
         Jackson Lake Lodge, Jackson Hole, WY
            Contact: http://www2.nortoninstitutes.org

July 12, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon - Bankruptcy Judges Panel
         University Club, Jacksonville, FL
            Contact: http://www.turnaround.org/

July 12-15, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Northeast Bankruptcy Conference
         Marriott, Newport, RI
            Contact: 1-703-739-0800; http://www.abiworld.org/

July 18, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         TBA, South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

July 25-28, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      12th Annual Southeast Bankruptcy Workshop
         The Sanctuary, Kiawah Island, SC
            Contact: http://www.abiworld.org/

August 9-11, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      3rd Annual Mid-Atlantic Bankruptcy Workshop
         Hyatt Regency Chesapeake Bay
            Cambridge, MD
            Contact: http://www.abiworld.org/

September 6-8, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      15th Annual Southwest Bankruptcy Conference
         Four Seasons
            Las Vegas, NV
               Contact: http://www.abiworld.org/

August 23-26, 2007
   NATIONAL ASSOCIATION OF BANKRUPTCY JUDGES
      NABT Convention
         Drake Hotel, Chicago, IL
            Contact: http://www.nabt.com/

August 28, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon - Healthcare Panel
         Centre Club, Tampa, FL
            Contact: http://www.turnaround.org/

September 19, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Buying and Selling Troubled Companies
         Marriott North, Fort Lauderdale, FL
            Contact: http://www.turnaround.org/

September 19, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         TBA, South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

September 25, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon - Retail Panel
         Citrus Club, Orlando, FL
            Contact: http://www.turnaround.org/

October 11, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon
         University Club, Jacksonville, FL
            Contact: 561-882-1331 or http://www.turnaround.org/

October 10-13, 2007
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Orlando, FL
            Contact: http://www.ncbj.org/

October 16-19, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         Marriott Copley Place
            Boston, MA
               Contact: 312-578-6900; http://www.turnaround.org/

October 30, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon
         Centre Club, Tampa, FL
            Contact: 561-882-1331 or http://www.turnaround.org/

October 30, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Crisis Communications With Employees,Vendors and Media
         Centre Club, Tampa, FL
            Contact: http://www.turnaround.org/

November 14, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      Dinner
         South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

December 6-8, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Westin Mission Hills Resort, Rancho Mirage, CA
            Contact: 1-703-739-0800; http://www.abiworld.org/

December 19, 2007
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         TBA, South FL
            Contact: 561-882-1331 or http://www.turnaround.org/

January 10, 2008
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon
         University Club, Jacksonville, FL

March 25-29, 2008
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Spring Conference
         Ritz Carlton Grande Lakes, Orlando, FL
            Contact: http://www.turnaround.org/

April 3-6, 2008
   AMERICAN BANKRUPTCY INSTITUTE
      26th Annual Spring Meeting
         The Renaissance, Washington, DC
            Contact: http://www.abiworld.org/

June 12-14, 2008
   AMERICAN BANKRUPTCY INSTITUTE
      15th Annual Central States Bankruptcy Workshop
         Grand Traverse Resort and Spa, Traverse City, MI
            Contact: http://www.abiworld.org/

August 16-19, 2008
   AMERICAN BANKRUPTCY INSTITUTE
      13th Annual Southeast Bankruptcy Workshop
         Ritz-Carlton, Amelia Island, FL
            Contact: http://www.abiworld.org/

September 24-27, 2008
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Scottsdale, AZ
            Contact: http://www.ncbj.org/

October 28-31, 2008
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         Marriott New Orleans, LA
            Contact: 312-578-6900; http://www.turnaround.org/

December 4-6, 2008
   AMERICAN BANKRUPTCY INSTITUTE
      20th Annual Winter Leadership Conference
         Westin La Paloma Resort & Spa
            Tucson, AZ
               Contact: http://www.abiworld.org/

October 5-9, 2009
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         Marriott Desert Ridge, Phoenix, AZ
            Contact: 312-578-6900; http://www.turnaround.org/

2009 (TBA)
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Las Vegas, NV
            Contact: http://www.ncbj.org/

June 21-24, 2009
   INSOL
      8th International World Congress
         TBA
            Contact: http://www.insol.org/

October 4-8, 2010
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         JW Marriott Grande Lakes, Orlando, FL
            Contact: http://www.turnaround.org/

2010 (TBA)
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         New Orleans, LA
            Contact: http://www.ncbj.org/

   BEARD AUDIO CONFERENCES
      Coming Changes in Small Business Bankruptcy
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Distressed Real Estate under BAPCPA
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Changes to Cross-Border Insolvencies
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Healthcare Bankruptcy Reforms
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Calpine's Chapter 11 Filing
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Changing Roles & Responsibilities of Creditors' Committees
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Validating Distressed Security Portfolios: Year-End Price
         Validation and Risk Assessment
            Audio Conference Recording
               Contact: 240-629-3300;
               http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Employee Benefits and Executive Compensation under the
         New Code
            Audio Conference Recording
               Contact: 240-629-3300;
               http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Dana's Chapter 11 Filing
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Reverse Mergers-the New IPO?
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Fundamentals of Corporate Bankruptcy and Restructuring
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      High-Yield Opportunities in Distressed Investing
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Privacy Rights, Protections & Pitfalls in Bankruptcy
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      When Tenants File -- A Landlord's BAPCPA Survival Guide
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Clash of the Titans -- Bankruptcy vs. IP Rights
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Distressed Market Opportunities
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Homestead Exemptions under BAPCPA
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      BAPCPA One Year On: Lessons Learned and Outlook
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Surviving the Digital Deluge: Best Practices in E-Discovery
         and Records Management for Bankruptcy Practitioners and
            Litigators
               Audio Conference Recording
                  Contact: 240-629-3300;
                  http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Deepening Insolvency - Widening Controversy: Current Risks,
         Latest Decisions
            Audio Conference Recording
               Contact: 240-629-3300;
               http://www.beardaudioconferences.com/

BEARD AUDIO CONFERENCES
   KERPs and Bonuses under BAPCPA
      Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Diagnosing Problems in Troubled Companies
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

   BEARD AUDIO CONFERENCES
      Equitable Subordination and Recharacterization
         Audio Conference Recording
            Contact: 240-629-3300;
            http://www.beardaudioconferences.com/

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday.  Submissions via e-mail
to conferences@bankrupt.com are encouraged.

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Rizande B. Delos
Santos, Cherry A. Soriano-Baaclo, Jason A. Nieva, Melvin C. Tabao,
Tara Marie A. Martin, Frauline S. Abangan, and Peter A. Chapman,
Editors.

Copyright 2007.  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 $775 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 ***