TCR_Public/070525.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Friday, May 25, 2007, Vol. 11, No. 123

                             Headlines

888 SUMMIT WAY: Case Summary and Largest Unsecured Creditor
ABRAXAS PETROLEUM: March 31 Balance Sheet Upside-Down by $22 Mil.
AMERICAN AIRLINES: S&P Junks Rating on $125MM Refunding Bonds
AMERICAN TOWER: Fitch Places BB+ Rating on $1.25 Bln Senior Notes
AMERICAN TOWER: S&P Rates $1.25 Billion Sr. Credit Facility at BB+

ASARCO LLC: Wants to Employ CDM for Water Treatment Work
ASH HOLDING: Organizational Meeting Scheduled for June 1
BANC OF AMERICA: Fitch Junks Rating on $5.9-Mil. Class O Certs.
BELDEN CDT: Earns $22 Million in Three Months Ending March 25
BELL MICRO: Panel Says Evidence Don't Support Stock Option Probe

BENCH ADS: Case Summary & Largest Unsecured Creditor
BOWNE & CO: Earns $10.7 Million in First Quarter Ended March 31
BRAVO! BRANDS: Posts $29.4 Million Net Loss in Qtr Ended March 31
CA INC: Posts $20 Million Net Loss in Quarter Ended March 31
CATHOLIC CHURCH: San Diego Panel Wants Nod on Special Counsel

CATHOLIC CHURCH: San Diego Panel Taps Pachulski Stang as Counsel
CENTRAL PARKING: Equity Group Completes $1 Billion Acquisition
CIT HOME: S&P Cuts Ratings on 2002-1 Class BV Certificates to BB
COLLINS & AIKMAN: Judge Rhodes Eyes Judy O'Neill as Fee Examiner
COMM COMMERCIAL: Fitch Affirms Low B Ratings on $23.5-Mil. Certs.

COMMUNICATIONS CORP: Disclosure Statement Inadequate Says Bank
CONGOLEUM CORP: Asbestos Insurers Not Obligated to Pay, Court Says
CRESCENT REAL: To Be Acquired by Morgan Stanley for $6.5 Billion
CSFB MORTGAGE: Fitch Affirms Low B Ratings on $32.3-Mil. Certs.
CWABS ASSET: Moody's May Downgrade Ba1 Rating After Review

DELPHI CORP: Wants Court Nod on $10.5 Million Umicore Settlement
DELPHI CORP: Wants Claims Settlement Procedures Supplemented
DOLLAR THRIFTY: Moody's Rates $600 Million Credit Facility at B1
DOV PHARMA: Posts Net Loss of $82,376 in Quarter Ended March 31
DUNE ENERGY: March 31 Balance Sheet Upside-Down by $19,501,874

EAGLE BROADBAND: Gets $500,000 Initial Purchase Order from Sprint
ENESCO GROUP: Wants to Hire Baker & McKenzie as Tax Counsel
FASTENTECH INC: Closes $492 Million Merger Deal with Doncasters
FEDERAL-MOGUL: Seeks Summary Judgment vs. Pepsi's Amended Claim
FEDERAL-MOGUL: PepsiAmericas Contests Summary Judgment Motion

FLYI INC: Distribution Trust Wants Five Cases Closed
FOAMEX INTERNATIONAL: Posts $272 Mil. Equity Deficit at March 31
FORMICA CORP: Moody's May Downgrade Low-B Ratings After Review
GENERAL MOTORS: Mulls $1.1BB Unsec. Notes Offer to Boost Liquidity
GENERAL MOTORS: Debt Issuance News Cues Fitch to Cut Debt Rating

GMAC COMMERCIAL: Fitch Affirms $26.7 Million Class H Rating at B+
GOLDEN NUGGET: S&P Cuts Ratings to B+ and Retains Negative Watch
HOLLINGER INC: Black Says Investor Complaints on Fees was "Idiocy"
HOLLISTON MILLS: Organizational Meeting Scheduled on May 30
INDEPENDENT BANK: Earns $6.6 Million in Quarter Ending March 31

INFORMATION ARCHITECTS: Has $2,373,108 Equity Deficit at March 31
INTRALINKS INC: Rapid Growth Cues S&P to Assign B Corp. Credit
J.P. MORGAN: Fitch Affirms Four Low B Ratings on Four Classes
JOSE SANCHEZ-PENA: Organizational Meeting Scheduled for June 1
KB HOME: Agrees to Sell 49% Stake in Kaufman to PAI Partners

KIK CUSTOM: Moody's Affirms B2 Corporate Family Rating
KINGSLAND V: S&P Rates $14.9MM Class E Floating-Rate Notes at BB
LANDRY'S RESTAURANTS: S&P Lowers Credit Rating to B+ from BB-
LEASE INVESTMENT: Missed Interest Payment Cues S&P's 'D' Rating
LEXINGTON RESOURCES: Whitley Penn Raises Going Concern Doubt

LIFECARE HOLDINGS: Posts $1.7 Million Net Loss in First Qtr. 2007
LIFEPOINT HOSPITALS: S&P Rates $500MM Sr. Convertible Notes at B
LYNX CHEMICAL: Case Summary & 20 Largest Unsecured Creditors
MEDWAVE INC: Gets Nasdaq Non-Compliance and Stock Delisting Notice
MICHIGAN WATER: Improved Financials Cues S&P to Lift BB+ Rating

ML-CFC COMMERCIAL: S&P Rates $6.964MM Class P Certificates at B-
MORTGAGE LENDERS: Wants Until September 3 to Decide on Leases
MORTGAGE LENDERS: Landlord Balks at Lease Decision Extension Plea
MASTR ASSET: S&P Puts Low-B Ratings of Three Classes Under Watch
NEFF RENTAL: Prices Cash Tender Offerings on Two Senior Notes

NEPTUNE INDUSTRIES: Posts Equity Deficit of $1,579,698 at March 31
NEW CENTURY: Turns to Grant Thornton for Tax Accounting Services
NEW CENTURY: Engages Irell & Manella as Special Counsel
NORTHEAST COMMERCIAL: Case Summary & Nine Largest Unsec. Creditors
NORTHWEST AIRLINES: S&P to Put B+ Rating Upon Bankruptcy Emergence

NT HOLDING: Madsen & Associates Raises Going Concern Doubt
OCCAM NETWORKS: Faces Nasdaq Delisting Due to Delayed Filing
OMNOVA SOLUTIONS: Completes $162 Million Sr. Notes Tender Offering
PAC-WEST TELECOMM: Committee Balks at Terms of $18.5MM Financing
PACIFIC LUMBER: May Continue to Use Cash Collateral Until June 1

PATIENT SAFETY: Squar, Milner Raises Going Concern Doubt
PAYLESS SHOESOURCE: $800MM Stride Rite Deal Cues S&P's Neg. Watch
PENINSULA GAMING: Credit Improvements Cue S&P's Positive Watch
PERLAN THERAPEUTICS: Case Summary & 14 Largest Unsecured Creditors
PLANETOUT INC: Must Pay $15 Million Orix Loan by August 31

PLANETOUT INC: Posts $6.8 Mil. Net Loss in Quarter Ended March 31
PLANETOUT INC: Seeking Strategic Alternatives to Raise Capital
PORTRAIT CORP: Court Sets June 4 Hearing on Purchase Deal with CPI
RESIDENTIAL ACCREDIT: Fitch Junks Rating on Class B-2 S2001-QS18
RESIDENTIAL ASSET: Fitch Affirms Low B Ratings on Two Classes

ROADHOUSE GRILL: Rachlin Cohen Raises Going Concern Doubt
RURAL CELLULAR: Moody's Junks Rating on $115.5 Million Note Issue
RURAL CELLULAR: Operation Improvements Cue S&P's Stable Outlook
SAKS INCORPORATED: 2007 1st Quarter Earnings Lowers to $11 Million
SALISBURY BY THE SEA: Case Summary & Five Largest Unsec. Creditors

SI INTERNATIONAL: Inks Pact to Buy LOGTEC Inc.'s Stake for $59MM
SIRIUS SATELLITE: Antitrust Chairman Balks at XM-Sirius Merger
SOLERA HOLDINGS: Closes IPO of $26 Million Shares of Common Stock
SPECIALIZED TECHNOLOGY: High Leverage Cues S&P's 'B' Credit Rating
SPECIALTY RESTAURANT: Wants to Employ MGLAW PLLC as Local Counsel

SPIRIT FINANCE: Moody's Assigns B1 Corporate Family Rating
SPIRIT FINANCE: S&P Rates Pending $850 Million Term Loan at B
SPORTS CLUB: Dec. 31 Balance Sheet Upside-Down by $24,190,000
STROBER ORGANIZATION: Moody's Cuts Corporate Family Rating to B2
SWEETSKINZ HOLDINGS: Taps Akin Gump as Special Corporate Counsel

TESORO CORP: S&P Rates Proposed $500MM Sr. Unsecured Notes at BB+
TARGUS GROUP: Slow Reduction of Inventories Cue S&P's Neg. Watch
TOWER RECORDS: Committee Hires Macquarie as Financial Advisors
TRIMAS CORP: Completed IPO Cues S&P to Lift Rating to B+ from B
TURNING STONE: Increasing Concerns Cue S&P to Lower Rating to B

U.S. ENERGY: Chapter 11 Plan Paying Creditors In Full Confirmed
UNITED CLEANERS: Case Summary & 20 Largest Unsecured Creditors
VALLEY OIL: Secured Creditor Wants Chapter 11 Case Dismissed
VERINT SYSTEMS: Witness Systems Acquisition Deal Approved
WCI COMMUNITIES: Board of Directors To Continue Sale Process

WHOLE FOODS: Reschedules Tender Offer Expiration Date to June 20
XM SATELLITE: Antitrust Chairman Balks at XM-Sirius Combination

* BOOK REVIEW: Ancient Curious and Famous Wills

                             *********

888 SUMMIT WAY: Case Summary and Largest Unsecured Creditor
-----------------------------------------------------------
Debtor: 888 Summit Way
        12325 Imperial Highway, Suite 301
        Norwalk, CA 90650

Bankruptcy Case No.: 07-14240

Chapter 11 Petition Date: May 23, 2007

Court: Central District Of California (Los Angeles)

Judge: Barry Russell

Debtor's Counsel: Dennis Winters, Esq.
                  1820 East 17th Street
                  Santa Ana, CA 92705
                  Tel: (714) 836-1381

Total Assets: $1,650,000

Total Debts:  $1,055,524

Debtor's Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
1537 Wilton, L.L.C.              loan                   $15,000
1537 Wilton
Los Angeles, CA


ABRAXAS PETROLEUM: March 31 Balance Sheet Upside-Down by $22 Mil.
-----------------------------------------------------------------
Abraxas Petroleum Corporation's balance sheet as of March 31,
2007, reflected total assets of $117.7 million, total liabilities
of $139.8 million, and total stockholders' deficit of
$22.1 million.

During the three months ended March 31, 2007, the company had a
net loss of $734,000 on total revenue of $11.7 million, as
compared with a net income of $1.2 million on total revenue of
$13.3 million during the three months ended March 31, 2006.

Operating revenue from natural gas and crude oil sales decreased
to $11.3 million from $12.9 million for the first quarter of 2006.
The decrease in revenue was primarily due to a reduction in
realized prices during the first quarter of 2007 as compared to
the same period of 2006.  Reduced realized prices had a negative
impact of $1.2 million on revenue for the quarter.  A decline in
natural gas production partially offset by an increase in crude
oil production had a negative impact of $427,000 for the first
quarter of 2007.

                  Liquidity and Capital Resources

At March 31, 2007, the company's current liabilities of about
$11.4 million exceeded the company's current assets of
$7.2 million resulting in a working capital deficit of
$4.2 million.  This compares to a working capital deficit of
approximately $3.7 million at Dec. 31, 2006.  Current liabilities
at March 31, 2007, consisted of trade payables of $2.5 million,
revenues due third parties of $2.5 million, accrued interest of
$5.4 million and other accrued liabilities of $1 million.

Capital expenditures during the first three months of
2007 were $3.9 million, as compared to $7.1 million during the
same period of 2006.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fc6

                     About Abraxas Petroleum

Headquartered in San Antonio, Texas, Abraxas Petroleum Corporation
-- http://www.abraxaspetroleum.com/-- is an independent natural  
gas and crude oil exploitation and production company with
operations concentrated in Texas and Wyoming.  Abraxas was founded
in 1977 and is publicly traded on the American Stock Exchange
under the ticker symbol "ABP".


AMERICAN AIRLINES: S&P Junks Rating on $125MM Refunding Bonds
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' rating to
American Airlines Inc.'s (B/Positive/--) $125 million Dallas/Fort
Worth International Airport special facility revenue refunding
bonds, series 2007, due 2030.  The bonds are guaranteed by
American's parent, AMR Corp. (B/Positive/B-2), and are secured by
payments made by American to the airport authority.  Proceeds are
being used to refund the outstanding revenue bonds, series 1992
(rated 'CCC+'), whose rating is withdrawn.
      
"The DFW revenue bonds are the equivalent of unsecured debt of
American and parent AMR Corp., and are accordingly rated 'CCC+',"
said Standard & Poor's credit analyst Philip Baggaley.  "Unsecured
debt of American and AMR is rated two notches lower than the 'B'
corporate credit ratings on the companies, due to the large amount
of secured debt and leases that effectively rank senior to
unsecured obligations."
     
Ratings on Fort Worth, Texas-based AMR and American reflect
participation in the competitive, cyclical, and capital-intensive
airline industry; erosion of financial strength by substantial
losses during 2001-2005; and a heavy debt and pension burden.  
Satisfactory liquidity, with $5.4 billion of unrestricted cash and
short-term investments at March 31, 2007, and an improving
earnings trend, are positives.  In the first quarter of 2007, AMR
earned $81 million, compared with a $92 million loss in the same
period in 2006, driven by stronger revenue generation. Earnings
and cash flow are expected to improve further during the remainder
of 2007, but a soft domestic economy and high and volatile fuel
prices represent risks.
     
A healthy cash balance and solid internal cash generation support
credit quality, despite substantial debt maturities.  Further
gains in earnings and cash flow, if they appear sustainable, could
prompt an upgrade over the coming year.  The outlook could be
revised to stable if airline industry conditions weaken,
curtailing expected earnings improvements.


AMERICAN TOWER: Fitch Places BB+ Rating on $1.25 Bln Senior Notes
-----------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to American Tower
Corporation's proposed five-year $1.25 billion senior unsecured
revolving credit facility.  The ratings at AMT have been affirmed
and include:

  American Tower Corp.;

     -- Issuer default rating (IDR) at 'BB+';
     -- Senior Unsecured notes at 'BB+';

In addition, these ratings will be withdrawn:

  American Towers, Inc.:

     -- Issuer default rating 'BB';
     -- Senior secured credit facility 'BBB-';
     -- Senior subordinated debt 'BB+'.

  SpectraSite Communications Inc.:

     -- Issuer default rating 'BB';
     -- Senior secured credit facility 'BBB-'.

The IDR and secured credit facility ratings at ATI will be
withdrawn once the new credit facility closes and the secured
facility is repaid. The Rating Outlook is Stable.

American Tower's ratings reflect the strong operating performance
which Fitch's expects to continue 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.  This has translated into a
predictable and growing cash flow stream generated primarily from
investment grade national wireless operators.  Fitch believes
these characteristics more than offset AMT's sizable share
repurchase program and the higher 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.  Industry demand is currently
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 2007, AMT has taken several steps to address its longer
term financial strategy.  In the first quarter, AMT completed a
cash tender offer for its 5.0% Convertible Notes due 2010 with 76%
of the notes repurchased.  In the second quarter, AMT successfully
securitized the majority of its SpectraSite assets with $1.75
billion of commercial mortgage pass-through certificates.  AMT
used proceeds from the securitization to repay $765 million under
the SpectraSite credit facility and $325 million of its 7.25%
senior subordinated notes at ATI due 2011.  As a result, all but
$0.2 million of senior subordinated debt at ATI has been retired.  
Fitch expects any new long-term debt to be issued by AMT.

Based on current capital allocation plans, Fitch expects leverage
for 2007 in the range of 4.0x-4.5x.  The liquidity position is
solid owing to its free cash flow, cash on hand and undrawn
revolver capacity.  The sizable $1.5 billion share repurchase
program will be funded by free cash flow, existing cash and debt.  
As of the first-quarter conference call, AMT had repurchased $289
million of shares and expects to complete the share repurchase
program by February of 2008.

When the new unsecured credit facility closes, AMT will draw down
on the facility to refinance the existing $1.6 billion senior
secured credit facility at ATI.  Currently, the company has drawn
$1 billion of the secured facility.  The proposed facility will
have substantially similar terms as the ATI facility.

Headquartered in Boston, Massachusetts, American Tower Corp.
(NYSE: AMT) -- http://www.americantower.com/-- is an   
independent owner, operator and developer of broadcast and
wireless communications sites in the United States, Mexico and
Brazil.  American Tower owns and operates over 22,000 sites in
the United States, Mexico, and Brazil.  Additionally, American
Tower manages approximately 2,000 revenue producing rooftop and
tower sites.


AMERICAN TOWER: S&P Rates $1.25 Billion Sr. Credit Facility at BB+
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' rating to
Boston-based American Tower Corp.'s $1.25 billion senior unsecured
revolving credit facility.
     
The company expects to use borrowings under this new credit
facility in part to repay all amounts outstanding under the
existing bank loan at American Tower Operating Co., which
currently totals about $1 billion.  The balance of the new credit
facility would be available for general corporate purposes,
including repurchases of common stock.  Pro forma for the new bank
debt, American Tower, a wireless tower operator, will have about
$4 billion of total debt outstanding.
     
At the same time, S&P raised the rating on the company's
$1.2 billion of outstanding unsecured notes to 'BB+' from 'BB-'.
With the upcoming repayment of the American Tower Operating Co.
bank facility, there will be significantly less priority debt in
the capital structure.  S&P also affirmed the 'BB+' corporate
credit rating on American Tower. The outlook is stable.
      
"The ratings on American Tower reflect the promising prospects of
its wireless tower leasing business, which is expected to generate
stronger levels of net free cash flow after capital expenditures,"
said Standard & Poor's credit analyst Catherine Cosentino.
     
Despite these very favorable business-risk characteristics, which
are indicative of an investment-grade business risk profile,
ratings on American Tower are constrained by its aggressive
financial policy.  The company is expected to engage in share
repurchases over the next few years, now that it has completed its
review of its accounting practices related to stock options and is
current on its filings of financial statements.  Management has
indicated that it is targeting a debt to EBITDA ratio of 4x-6x,
before operating lease adjustment, or in the mid-5x to 8x area,
after adjustment.


ASARCO LLC: Wants to Employ CDM for Water Treatment Work
--------------------------------------------------------
Camp Dresser McKee Inc., a consulting, engineering, construction,
and operations firm, has provided services to ASARCO LLC prior to
its bankruptcy filing and has continued to do so as an ordinary
course professional, Tony M. Davis, Esq., at Baker Botts L.L.P.,
in Houston, Texas, says.

ASARCO and CDM are parties to a Professional Services Agreement
dated September 2003, as extended.  Pursuant to the Agreement,
CDM will prepare and ASARCO will approve a specific scope of
services and fee schedule for each scope of work.

ASARCO now wants to retain CDM in connection with these projects:

                                                     Estimated
   Location             Nature of Work                 Cost
   --------             --------------               ---------
   El Paso, Texas   Groundwater - evaluation of       $199,102
                    remedial treatment options,
                    peer review of treatment
                    system pilot testing, and
                    regulatory guidance.

   Mike Horse Mine/ Mine Adit Drainage -               146,392
   Upper Blackfoot  preliminary design of active
   Mining Complex,  water treatment and sludge
   Montana          disposal system.

   East Helena,     Groundwater - evaluation of         51,731
   Montana          remedial treatment options.

   Trench Mine/     Mine Adit Drainage - final          30,000
   Alum Gulch,      design and construction
   Arizona          oversight of water treatment
                    System.

   Salero Ranch,    Surface and Groundwater -           20,000
   Arizona          maintenance and organization
                    existing passive adit water
                    treatment system.

Accordingly, ASARCO seeks authority from the U.S. Bankruptcy Court
for the Southern District of Texas to hire CDM to perform water
treatment work on certain of its properties.

ASARCO believes CDM is well qualified to do the contemplated
work.  CDM is familiar with the sites and the work to be
performed.

Moreover, CDM has expertise regarding industrial water treatment
applications for mine drainage, and has patented processes that
have proven effective on projects like those of ASARCO, Mr. Davis
adds.

                         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).

The Debtors' exclusive period to file a plan expires on
Aug. 9, 2007.  (ASARCO Bankruptcy News, Issue No. 46; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


ASH HOLDING: Organizational Meeting Scheduled for June 1
--------------------------------------------------------
Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, will hold
an organizational meeting to appoint an official committee of
unsecured creditors in Ash Holding, LLC and its debtor-affiliates'
Chapter 11 cases at 1:00 p.m., on June 1, 2007, at the U.S.
Trustee's Office, Bridge View Building, 800-840 Cooper Street,
Suite 102, in Camden, New Jersey.

The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' cases.  The
meeting is not the meeting of creditors pursuant to Section 341
of the Bankruptcy Code.  However, a representative of the Debtor
will attend and provide background information regarding the
cases.

Creditors interested in serving on a Committee should complete
and return to the U.S. Trustee a statement indicating their
willingness to serve on an official committee.

Official creditors' committees, constituted under Section 1102 of
the Bankruptcy Code, ordinarily consist of the seven largest
creditors who are willing to serve on a committee.  In some
Chapter 11 cases, the U.S. Trustee is persuaded to appoint
multiple creditors' committees.

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense.  They may investigate the Debtors' business and
financial affairs.  Importantly, official committees serve as
fiduciaries to the general population of creditors they
represent.  Those committees will also attempt to negotiate the
terms of a consensual Chapter 11 plan -- almost always subject to
the terms of strict confidentiality agreements with the Debtors
and other core parties-in-interest.  If negotiations break down,
the Committee may ask the Bankruptcy Court to replace management
with an independent trustee.  If the Committee concludes that the
reorganization of the Debtors is impossible, the Committee will
urge the Bankruptcy Court to convert the Chapter 11 cases to a
liquidation proceeding.

Based in Pennington, New Jersey, Ash Holding, LLC and its
affiliates are florists and retail lawn/garden materials and
equipment.  The group filed for Chapter 11 protection on
May 9, 2007 (Bankr. D. N.J. Case Nos. 07-16516 through 07-16526).  
Jerrold S. Kulback, Esq. and Stephen M. Packman, Esq., at Archer &
Greiner, P.C., represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed estimated assets and debts of $1 million to
$100 million.


BANC OF AMERICA: Fitch Junks Rating on $5.9-Mil. Class O Certs.
---------------------------------------------------------------
Fitch Ratings has downgraded and assigned Distressed Recovery
ratings to Banc of America Commercial Mortgage Inc.'s commercial
mortgage pass-through certificates, series 2001-1 as:

     -- $6.8 million class N to 'B-/DR1' from 'B';
     -- $5.9 million class O to 'CCC/DR2' from 'B-'.

Fitch has upgraded these classes as follows:

     -- $9.5 million class E to 'AAA' from 'AA+';
     -- $9.5 million class F to 'AAA' from 'AA';
     -- $19 million class G to 'AA-' from 'A';
     -- $14.2 million class H to 'A-' from 'BBB+';
     -- $13.3 million class J to 'BBB' from 'BBB-'.

Fitch has also affirmed these classes:

     -- $495.5 million class A-2 at 'AAA';
     -- $47.6 million class A-2F at 'AAA';
     -- Interest-only class X at 'AAA';
     -- $35.6 million class B at 'AAA';
     -- $21.3 million class C at 'AAA';
     -- $19 million class D at 'AAA';
     -- $23.5 million class K at 'BB';
     -- $2.1 million class L at 'BB-';
     -- $5.5 million class M at 'B+'.

Fitch does not rate the $5.4 million class P certificates.  Class
A-1 has paid in full.

The downgrades are due to increased loss expectations on the
specially serviced loans.

The rating upgrades reflect increased subordination levels due to
defeasance and scheduled amortization.  Three loans (5%) have
defeased since Fitch's last rating action.  As of the May 2007
distribution date, the pool's aggregate balance has decreased
23.7% to $733 million from $948.1 million at issuance.  Thirty-
four loans (19.4%) have defeased since issuance.

Currently, five assets (2.8%) are in special servicing.  The
largest specially serviced asset (1.4%) is a multi-family property
in Lindenwold, New Jersey, which is current.  The property is
suffering cash flow problems due to declining occupancy.  The
special servicer is evaluating the borrower's request for relief.

The second largest specially serviced asset (0.7%) is a retail
shopping center in Arabi, Louisiana.  The property suffered heavy
damage due to Hurricane Katrina.  The sole tenant has rejected
their lease and is not returning to the property.  The special
servicer has received limited insurance proceeds for hurricane-
related damages from the borrower.  The special servicer is also
pursuing foreclosure and negotiating with the sole tenant's
insurance company.

The third largest specially serviced asset (0.4%) is an office
property in Greenville, South Carolina, and is in foreclosure.  
The loan transferred to special servicing in September 2006 due to
occupancy issues.  The property is currently 50% vacant and the
special servicer is in the process of foreclosure.

Expected losses are anticipated to fully deplete the unrated class
P and impact class O (rated 'CCC/DR2').

Fitch has designated 24 loans (16.2%) as Fitch Loans of Concern;
these include the specially serviced loans and those loans with
low cash flow and occupancy.  Of these loans, the largest Fitch
Loan of Concern, which is the fifth largest loan (2.3%) in the
pool, is an office property in Phoenix, Ariz., which has been
performing poorly since 2003 due to occupancy issues.  The loan
remains current, and occupancy has increased to 80% as of
September 2006 from 69% at year-end 2005.

315 Park Avenue South loan (11.6%), the only credit assessed loan
in the transaction, maintains an investment-grade credit
assessment.  Occupancy at September 2006 remains in line with
year-end 2005 occupancy at 92%.


BELDEN CDT: Earns $22 Million in Three Months Ending March 25
-------------------------------------------------------------
Belden CDT Inc. disclosed that revenue for the first quarter
ended March 25, 2007, was $336.7 million and operating income
was $37.2 million.  Income from continuing operations was
$22.0 million.  The quarterly revenue increase of 4.6% from the
prior-year first quarter revenue included 1.6% favorable currency
translation.

During the quarter, Belden recorded $3.3 million pretax in
severance, asset impairment, and adjusted depreciation charges
associated with previously announced restructuring activities in
North America and Europe.  In the first quarter of 2006, the
Company incurred pretax charges of $2.4 million for severance and
accelerated depreciation associated with European restructuring.

Adjusted for these items, operating income increased 38% year over
year to $40.5 million in the first quarter 2007.  As a percent of
revenue, adjusted operating income was 12% in the first quarter of
2007, compared with 9.1% in the first quarter of 2006.

"Our 2007 performance is off to a good start," John Stroup,
President and Chief Executive Officer of Belden, said.  "In the
first quarter we made further progress in the implementation of
our strategic plan.  Our operating income increased significantly
from the 2006 first quarter both in dollars and as a percent of
revenues.  These increases reflect the continuing impact of our
product portfolio management and regional manufacturing
initiatives.  The healthy operating results were combined with
continuing progress in reducing our working capital to generate
strong free cash flow in the quarter."

At March 25, 2007, the company's balance sheet showed total assets
of $1.7 billion and total liabilities of $810.2 million, resulting
in a $903.3 million stockholders' equity.  A year ago, equity was
$843.9 million.

                           About Belden

Headquartered in Richmond, Indiana, Belden CDT Inc. (NYSE:BDC) --
http://www.belden.com/-- designs, manufactures, and markets  
signal transmission products for data networking and a wide range
of specialty electronics markets including entertainment,
industrial, security and aerospace applications.

                          *     *     *

Belden's 7% Senior Subordinated Notes due 2017 carry Moody's
Investors Service's Ba2 rating and Standard & Poor's BB- rating.


BELL MICRO: Panel Says Evidence Don't Support Stock Option Probe
----------------------------------------------------------------
Bell Microproducts Inc.'s special committee has completed its
independent investigation of the company's historical stock option
practices and has reached a conclusion that available evidence
does not adequately support the company's use of some stock option
grant dates, for financial accounting purposes.  

As a result, different measurement dates should be used to compute
compensation expense for the affected grants than those that were
actually used in preparing the company's financial statements.  
However, the company notes that:

   -- the special committee did not conclude that there was
      intentional misconduct or fraud associated with granting and
      processing of stock options during the review period of
      Jan. 1, 1996 - Dec. 31, 2006; and
    
   -- the board of directors, including the members of the special
      committee, reiterated its commitment to and support for the
      company's current management;

The special committee findings are reviewed by the company, and
are subject to review by the company's independent auditor.
The company has not determined the amount of noncash charges for
compensation expense and related cash and non-cash tax adjustments
that will be recorded.  The company will be restating its
historical financial statements for other reasons; accounting
adjustments pertaining to stock options will also be reflected in
the restated financial statements.  Bell Microproducts is
committed to filing its periodic reports as soon as possible after
the completion of the restatement.

A special committee of the Bell Microproducts Inc. board of
directors was appointed to conduct an evaluation of the company's
stock option practices with the assistance of independent counsel
and independent accounting consultants.
    
Bell Microproducts has received waivers until Sept. 30, 2007,
under the company's credit agreements with Wachovia Capital
Finance Corporation, Wachovia Bank, National Association and the
Teachers' Retirement Systems of Alabama, with respect to the
delivery of certain quarterly information and documentation to its
lenders.
    
                     About Bell Microproducts

Headquartered in San Jose, California, Bell Microproducts Inc.
(Nasdaq: BELM) -- http://www.bellmicro.com/-- is an    
international, value-added distributor of high-tech products,
solutions and services, including storage systems, servers,
software, computer components and peripherals, as well as
maintenance and professional services.  Bell is a Fortune 1000
company that has operations in Argentina, Brazil, Chile and
Mexico.

                          *     *     *

In March 2007, the company received a Nasdaq Staff Determination
notice because the company did not file its Annual Report 10-K for
the period ended Dec. 31, 2006.  The Nasdaq Listing and Hearing
Review Council expects a response to why the company failed to
file its annual report.  Nasdaq Listing Qualifications Panel
extended until May 22, 2007, the company's request for continued
listing.

In addition, the company received waivers in relation to the
delivery of certain of its quarterly information and documentation
until May 31, 2007, under credit agreements with Wachovia Capital
Finance Corp., Wachovia Bank, National Association, and the
Teachers' Retirement Systems of Alabama.


BENCH ADS: Case Summary & Largest Unsecured Creditor
----------------------------------------------------
Lead Debtor: Bench Ads Management, Inc.
             19589 Northeast 10 Avenue North
             Miami, FL 33179

Bankruptcy Case No.: 07-13897

Debtor-affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Bench Ads, Inc.                            07-13897

Type of Business: The Debtors provide outdoor advertising
                  services.  It also provides complementary
                  services like production (with complete layout
                  and design capabilities), printing, photography,
                  and access to population and demographic
                  information and market analysis.  See
                  http://www.benchads.net/index.htm

Chapter 11 Petition Date: May 23, 2007

Court: Southern District of Florida (Miami)

Judge: Robert A. Mark

Debtor's Counsel: John M Cruz, II, Esq.
                  1041 Ives Dairy Road, Suite 236
                  Miami, FL 33179
                  Tel: (305) 249-2070

Total Consolidated Assets:  Unstated

Total Consolidated Debts: $2,200,000

Debtors' Consolidated Largest Unsecured Creditor:

   Entity                                          Claim Amount
   ------                                          ------------
Raymond and Barbara Tomzak                           $2,200,000
c/o Stanley M. Sacks, Esq.
633 South Andrews Avenue
Fort Lauderdale, FL 33301


BOWNE & CO: Earns $10.7 Million in First Quarter Ended March 31
---------------------------------------------------------------
Bowne & Co. Inc. reported revenue of $211.7 million in the first
quarter of 2007 compared to $205.8 million in the comparable 2006
quarter - a 3% increase.  Operating income was $12.4 million in
the first quarter of 2007 compared to $3.4 million in 2006 and
net income was $10.7 million compared to $1.5 million last year.

Segment profit for the quarter was $20 million, representing an
increase of $8.2 million, or 70%, from the first quarter of 2006.
Segment profit margin in 2007 was 9.4%, a significant improvement
over the 5.7% margin achieved in the first quarter of 2006.

                   Balance Sheet and Cash Flow

As of March 31, 2007, the company had $530 million in total
assets, $293.6 million in total liabilities, and $236.4 million in
total stockholders' equity.

For the quarter ended March 31, 2007, cash and marketable
securities declined $40.2 million from year-end 2006.  This
decline reflects the funding of $13 million in stock repurchases,
$12.4 million for acquisitions, $3.2 million in capital
expenditures and the normally high seasonal working capital usage
in the first quarter.

Accounts receivable increased about $25.1 million compared to
December 2006, due principally to normal seasonality and the
inclusion of St Ives Financial receivables as a result of the
January 2007 acquisition.  Days sales outstanding increased to
76 days in March 2007 from 73 days in March 2006.  Financial
Communications work-in-process inventory was $33.7 million at
March 31, 2007, compared to $31.9 in March 2006.  The company has
no borrowings outstanding under its $150 million five-year senior,
unsecured revolving credit facility.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?2018

                     Share Repurchase Program

In the 2007 first quarter, the company spent $13 million
repurchasing 835,876 shares of its common stock at an average
price per share of $15.53.  As of May 9, 2007, $35 million of its
share repurchase authorization remained.  From December 2004, the
inception of the company's share repurchase program, through
March 31, 2007, Bowne has spent $158.2 million to repurchase
10.7 million shares at an average price per share of $14.82.

David J. Shea, Bowne's chairman, president and chief executive
officer, commented, "This was an outstanding quarter, and our
strong operating results demonstrate the successful execution of
our key strategic initiatives and healthy capital markets, as we
gained market share during the quarter.  We're particularly
pleased with the improvement in our profitability and continued
growth of non-transactional revenue, which is at its highest level
since 2001."

                      About Bowne & Co. Inc.

Headquartered in New York City, Bowne & Co. Inc. (NYSE: BNE)
-- http://www.bowne.com/-- is a printing company, which  
specializes in financial documents such as prospectuses, annual
and interim reports, and other paperwork required by the SEC.
Bowne also handles electronic filings via the SEC's EDGAR system
and provides electronic distribution and high-volume mailing
services.  The financial printing business accounts for the bulk
of the company's sales.  Bowne also offers marketing and business
communications services and litigation support software.  The
company has 3,200 employees in 60 offices around the globe.  The
company's Latin American offices are located in Argentina, Brazil
and Mexico.

                          *     *     *

In January 2007, Moody's Investors Service affirmed the Ba3
corporate family rating and all other ratings of Bowne & Co., Inc.  
The outlook remains positive, indicating the potential for an
upgrade within the next 12 to 18 months, notwithstanding continued
share repurchase, the cash acquisition of Vestcom, and capital
expenditures related to headquarters relocation.


BRAVO! BRANDS: Posts $29.4 Million Net Loss in Qtr Ended March 31
-----------------------------------------------------------------
Bravo! Brands Inc., formerly known as Bravo Foods International
Corp., reported a net loss of $29.4 million for the first quarter
ended March 31, 2007, compared with a net loss of $276,667 for the
same period ended March 31, 2006.  

Total revenue for the first quarter of 2007 was $3,152,892, a
decrease of 11% from the first quarter of 2006 revenue of
$3,561,215.  The decrease in revenues resulted from a combination
of the change in the product mix and sales of products surpassing
CCE's required shelf life at prices below cost.

First quarter 2007 results include a non-cash impairment charge of
$17.7 million to write off the carrying value of the CCE, Hood and
Jasper intangible assets, a $3.5 million in unused capacity
penalties and a margin loss of $315,000 due to liquidation sales
of short code dated products.  

Results for the first quarter of 2006 included derivative income
of $4,949,188, compared to derivative income for the first quarter
of 2007 of $372,774.  Derivative income for the quarters ended
March 31, 2007 and 2006, are primarily due to the decline in the
company's common stock price during both quarters.

Marketing expenses and advertising increased $562,955 primarily
due to the company's sponsorship of National Hot Rod Association
pro stock race cars.  Selling expenses increased $360,165
primarily due to the hiring of additional sales personnel.

Interest expense, net and financing costs increased to $2,342,411
for the quarter ended March 31, 2007, from interest expense of
$36,364 for the quarter ended March 31, 2006.  The increase in
interest expense was due primarily to an increase in debt balance.  
The increase was also due to the increase in amortization of debt
discounts which amounted to approximately $1,363,825 for the
quarter ended March 31, 2007.

At Dec. 31, 2007, the company's balance sheet showed $7,596,901 in
total assets, $50,320,661 in total liabilities, and $2,656,614 in
total redeemable preferred stock, resulting in a $45,380,374 total
stockholders' deficit.

The company's balance sheet at March 31, 2007, also showed
strained liquidity with $2,670,771 in total current assets
available to pay $50,267,433 in total current liabilities.

Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?1fd7

                     Default on Senior Notes

On April 1, 2007, the company was in default of certain provisions
of the Senior Notes issued in July 2006, as amended in December
2006, due to the company's failure to make the required quarterly
interest payment of approximately $730,000.  The defaults entitle
the holders of the Senior Notes to certain penalties including the
acceleration of the Notes at a premium.

                       Going Concern Doubt

Lazar Levine & Felix LLP, in New York, expressed substantial doubt
about Bravo! Brands Inc.'s ability to continue as a going concern
after auditing the company's consolidated financial statements as
of the years ended Dec. 31, 2006, and 2005.  The auditing firm
pointed to the company's net loss of $36,697,013 for the year
ended Dec. 31, 2006, working capital deficit of $54,378,517, and  
accumulated deficit of $157,031,836 at Dec. 31, 2006.  The
auditing firm also reported that the company is delinquent in
payment of certain debts.

The company disclosed that, under the direction of its board of
directors, it has developed a remedial plan to address the most
critical needs of the company.  These include plans to secure new
distribution partners, the introduction of new dairy based
products into different segments of the beverage market, as well
as cost containment measures.  In connection with the default of
the Senior Notes, the company is negotiating a 120-day forbearance
agreement with its July 2006 Senior Note holders.  

                       About Bravo! Brands

Headquartered in North Palm Beach, Florida, Bravo! Brands Inc.
(OTC BB: BRVO.OB) -- http://www.bravobrands.com/-- develops,  
brands, markets, distributes and sells flavored milk products
throughout the 50 United States, Mexico and Puerto Rico.  Bravo!'s
products are available in the United States and internationally
through production agreements with regional aseptic milk
processors and are currently sold under the brand names
Slammers(R) and Bravo!(TM).  


CA INC: Posts $20 Million Net Loss in Quarter Ended March 31
------------------------------------------------------------
CA Inc. reported a net loss of $20 million for the fourth quarter
ended March 31, 2007, compared with a net loss of $41 million for
the same period ended March 31, 2006.  For the full year, net
income was $118 million, compared with net income of $159 million
reported in fiscal year 2006.

"I am pleased with CA's execution in the second half of the 2007
fiscal year as we met or exceeded our full-year guidance for total
revenue, non-GAAP earnings per share, total product and services
bookings and cash flow from operations," said John Swainson, CA
president and chief executive officer.  "Our solid performance was
a result of our increased focus on execution in all areas of our
business, with particular emphasis on our restructuring and cost
savings efforts, go-to-market strategy and an improved operational
focus.

"Over the last 12 months, we have refreshed virtually all our
major product lines and at CA WORLD in April introduced 16
Capability Solutions based on our Enterprise IT Management
vision," Swainson continued.  "We are seeing increased demand for
our infrastructure management, business service optimization and
security management offerings, which help our customers govern,
manage and secure their IT environments.  I am confident that we
have the right technology vision, products and solutions and
senior management team to continue our momentum from the second
half of fiscal 2007.

"I am also very pleased that CA has successfully concluded the
Deferred Prosecution Agreement," Swainson said.  "As a result of
the hard work of all CA employees, we are now a stronger company
and are moving forward with a sense of vigor and enthusiasm to
becoming one of the world's most successful software companies."

               Fourth Quarter and Full-Year Results

Revenue for the fourth quarter was $1.005 billion, an increase of
7 percent, or 4 percent in constant currency, over the
$942 million in the comparable prior year period.  Aside from the
gains attributed to currency, the increase in revenue primarily
came from growth in subscription revenue and professional
services.  The increase was partially offset by decreases in
software fees and other revenue, maintenance and financing fee
revenue as CA continues to transition from its prior business
model.  Revenue from professional services was up 3 percent over
the comparable prior year period.

For the full year, revenue was $3.943 billion, up 5 percent, or 3
percent in constant currency, compared to the $3.772 billion
reported in fiscal year 2006.  As in the fourth quarter, the
increase primarily was due to growth in subscription revenue and
professional services revenue.  Those increases partly were offset
by declines in software fees and other revenue, maintenance and
financing fee revenue.

Total expenses, before interest and taxes, for the fourth quarter
were $1.017 billion, up 3 percent, compared with $988 million in
the prior year period.  In the quarter, the company experienced
significantly higher restructuring and other costs and expenses
associated with the delivery of professional services compared to
the prior year period as well as an increase in bonus
expenditures.  This was offset partially by significantly lower
sales commission expense and amortization of capitalized software
costs.

For the full year, total expenses, before interest and taxes, were
$3.729 billion, up 3 percent from the $3.606 billion reported for
fiscal 2006.  The company experienced significantly higher
restructuring and other expenses and costs associated with the
delivery of professional services in fiscal year 2007 as compared
to fiscal year 2006, as well as an increase in bonuses
expenditures.  This was offset partially by lower commissions
expense and lower amortization of capitalized software costs.

The fourth quarter of fiscal year 2007 included restructuring and
other charges of $100 million, of which $71 million was related to
severance costs and $8 million associated with the closure of
facilities under the fiscal year 2007 cost reduction and
restructuring plan.  For the full year, the company recorded
restructuring and other costs of $201 million.  The fiscal year
2007 total includes $147 million in costs associated with the
company's fiscal year 2007 cost reduction and restructuring plan
and $19 million in costs associated with the company's fiscal year
2006 cost reduction and restructuring plan.

For the fourth quarter of fiscal year 2007, CA reported
$521 million in cash flow from operations, down 8 percent from the
$566 million reported in the prior year period.  

Fourth quarter cash flow was affected negatively by a lower volume
of bookings and associated billings, and a year-over-year
reduction in the aggregate amount of single installment contract
payments over the comparable period last fiscal year.

For the full year, cash flow from operations was $1.068 billion,
compared to $1.380 billion in the prior period.  The company
exceeded cash flow from operations guidance, in part, due to the
positive impact of $90 million in lower-than-expected tax payments
in the fourth quarter-the majority of which the company now
expects to pay in the first half of fiscal 2008.  The full-year
cash flow also was affected by a decrease in the average time it
took the company to pay vendors for products and services, higher
expenses, and increased restructuring costs.  In addition, cash
flow also was negatively affected by contributions to CA's
employee 401(k) savings plan in fiscal year 2007 that were not
made in the prior fiscal year.

                         Capital Structure

The balance of cash and marketable securities at March 31, 2007,
was $2.280 billion.  With $2.583 billion in total debt
outstanding, the company has a net debt position of approximately
$303 million.

Over the course of fiscal year 2007, CA repurchased approximately
51 million shares of its common stock at an aggregate cost of
approximately $1.2 billion.

The company also announced that it currently is in the process of
executing an accelerated share repurchase of up to $500 million in
common shares.  The transaction will be financed with existing
cash.

"Our decision to continue our stock repurchases is an indication
of our confidence in CA's ability to generate healthy cash flows
and in our long-term business position," said Nancy Cooper, CA's
chief financial officer.  "The program also speaks to our strategy
of balancing the way we allocate our capital."

At March 31, 2007, the company's balance sheet showed
$10.585 billion in total assets, $6.895 billion in total
liabilities, and $3.690 billion in total stockholders' equity.

The company's balance sheet at March 31, 2007, also showed
strained liquidity with $3.101 billion in total current assets
available to pay $3.714 billion in total current liabilities.

                           About CA Inc.

CA Inc. (NYSE: CA) -- http://ca.com/-- one of the world's largest  
information technology management software companies, unifies and
simplifies the management of enterprise-wide IT.  Founded in 1976,
CA is headquartered in Islandia, N.Y., and serves customers in
more than 140 countries.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 6, 2007,
Moody's Invetors Service said it is maintaining its negative
outlook for CA Inc. following the release of the company's fiscal
2007 earnings report.


CATHOLIC CHURCH: San Diego Panel Wants Nod on Special Counsel
-------------------------------------------------------------
The Official Committee of Unsecured Creditors Committee appointed
in The Roman Catholic Bishop of San Diocese's Chapter 11 case
seeks authority from the U.S. Bankruptcy Court for the Southern
District of California to retain Morgan, Lewis & Bockius LLP, as
its special insurance counsel, effective as of March 19, 2007.

The Committee says that the Debtor's bankruptcy filing was
precipitated by the assertion of numerous claims that the Diocese
is legally responsible for acts of sexual abuse committed by
members of the clergy under its supervision and control.  In the
course of discovery conducted in the individual suits commenced by
the victims of the abuse, the Diocese has identified certain
insurance policies as potentially affording it coverage for its
alleged liability to those victims.

Accordingly, the existence and scope of the Diocese's insurance
coverage is of prime importance to the Diocese's creditors and to
the Committee.

In addition to the coverage afforded by the Diocese's insurance
policies, the Diocese's Schedule B -- Personal Property identifies
the Diocese's interests in "Catholic Mutual Group" and "Catholic
Umbrella Pool" as assets of San Diego's bankruptcy estate.

The Committee is informed and believes that those entries on the
Diocese's schedules refer to entities involved in providing
insurance for the sexual abuse claims that led to the filing of
the Chapter 11 petition.  Accordingly, expertise in insurance
matters will be required to analyze the value of the Diocese's
interests in those entities.

According to the Committee, it requires the assistance of special
counsel versed in insurance matters to advise it regarding the
existence and scope of the Diocese's insurance coverage for
sexual abuse claims and the Diocese's rights as an equity holder
in the Catholic Mutual Group and Catholic Umbrella Pool.

The Creditors Committee has selected Morgan Lewis to provide that
advice based on the firm's special expertise in those areas and
extensive experience in relation to coverage issues pertaining to
sexual abuse cases involving the Catholic Church.  The services
to be rendered by Morgan Lewis will not be duplicative of the
services to be rendered by the Committee's general counsel,
Pachulski Stang Ziehl Young Jones & Weintraub, the Committee
tells the Court.

The Creditors Committee notes that Morgan Lewis was retained to
provide insurance coverage advice to the holders of sexual abuse
claims against the San Diego Diocese, the Los Angeles
Archdiocese, the Orange County Diocese, the San Francisco
Archdiocese and the Milwaukee Archdiocese in October 2003.  As a
result of those representations, Morgan Lewis has obtained
substantial expertise and information regarding the terms and
conditions of the insurance policies issued to those entities and
is intimately familiar with the legal and factual issues that
exist with respect to insurance coverage for the claims asserted
by sexual abuse victims in this bankruptcy case.

In exchange for its professionals' services, Morgan Lewis will be
paid based on the firm's hourly rates:

    Professional                      Hourly Rate
    ------------                      -----------
    Micheal Y. Horton, Esq.              $760
    Richard W. Esterkin, Esq.            $695
    David S. Cox, Esq.                   $525
    Assaf S. Hami, Esq.                  $475

Morgan Lewis will also be reimbursed for reasonable out-of-pocket
expenses.  The firm has not received any retainer.

Mr. Horton, a partner at Morgan Lewis, discloses that commencing
on 2002, the law firm of Kiesel Boucher & Larsen retained his
former firm, Zevnik Horton LLP to provide advice to it regarding
the insurance available to pay claims against a number of
Catholic Dioceses arising from the alleged sexual abuse of
members of the church by the clergy.  In October 2003, many of
the attorneys at Zevnik Horton, including Mr. Horton, joined
Morgan Lewis and, from and after that date, Morgan Lewis
continued Zevnik Horton's prior representation with regards to
those matters.

However, Mr. Horton assures the Court that neither Morgan Lewis
nor any of its attorneys has any connection with the Diocese, or
any party-in-interest in the bankruptcy case, and does not
currently represent any creditor or other party-in-interest in
relation to the Diocese's bankruptcy case and does not have any
relationship with any attorney or accountant for any of those
parties, the U. S. Trustee or any person employed by the U.S.
Trustee, other than its relationship with Kiesel Boucher in
regards to matters other than the matters pertaining to the
Diocese.

In addition, Mr. Horton notes that Morgan Lewis is presently
representing the Western Dominican Province in connection with
claims of sexual abuse by WDP friars and corresponding insurance
coverage issues.

"I do not believe that there is any actual or potential conflict
of interest between our proposed representation of the Committee
as special insurance counsel and our representation of the WDF,"
Mr. Horton tells Judge Adler.

The Roman Catholic Diocese of San Diego in California --
http://www.diocese-sdiego.org/-- employs approximately
3,000 people in various areas of work.  The Diocese filed for
Chapter 11 protection just before commencement of the first of
court proceedings for 140 sexual abuse lawsuits filed against the
Diocese.  Authorities of the San Diego Diocese said they were not
in favor of litigating their cases.

The San Diego Diocese filed for chapter 11 protection on Feb. 27,
2007 (Bankr. S.D. Calif. Case No. 07-00939).  Gerald P. Kennedy,
Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents
the Diocese.  In its schedules of assets and liabilities, the
Diocese listed total assets of $152,510,888 and total liabilities
of $72,754,092.

The Diocese's exclusive period to file a chapter 11 plan of
reorganization expires on June 27, 2007.  On March 27, 2007, the
Debtor filed its plan and disclosure statement.  (Catholic Church
Bankruptcy News, Issue No. 92; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CATHOLIC CHURCH: San Diego Panel Taps Pachulski Stang as Counsel
----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in The
Roman Catholic Bishop of San Diocese's Chapter 11 case seeks
authority from the U.S. Bankruptcy Court for the Southern District
of California to retain Pachulski Stang Ziehl Young Jones &
Weintraub LLP as its counsel, effective as of March 20, 2007.

According to the Creditors Committee, Pachulski Stang's attorneys
have extensive experience representing creditors' committees,
debtors, creditors, trustees and others in a wide variety of
bankruptcy cases.  The Committee, therefore, believes that the
firm is well qualified to represent it in The Roman Catholic
Bishop of San Diego's Chapter 11 case.

As counsel to the Committee, Pachulski Stang will assist, advise
and represent the Committee in:

    a. its consultations with the Diocese regarding the
       administration of the Chapter 11 case;

    b. analyzing the Diocese's assets and liabilities,
       investigating the extent and validity of liens and
       participating in and reviewing any proposed asset sales,
       any asset dispositions, financing arrangements and cash
       collateral stipulations or proceedings;

    c. any manner relevant to reviewing and determining the
       Diocese's rights and obligations under leases and other
       executory contracts;

    d. investigating the acts, conduct, assets, liabilities and
       financial condition of the Diocese, the Diocese's
       operations and the desirability of the continuance of any
       portion of those operations, and any other matters relevant
       to the Chapter 11 case or to the formulation of a plan;

    e. its participation in the negotiation, formulation and
       drafting of a plan of liquidation or reorganization;

    f. advising the Committee on the issues concerning the
       appointment of a trustee or examiner under Section 1104 of
       the Bankruptcy Code;

    g. understanding its powers and its duties under the
       Bankruptcy Code, Bankruptcy Rules, Local Bankruptcy Rules
       and the Guidelines and in performing other services as are
       in the interests of those represented by the Committee; and

    h. the evaluation of claims and on any litigation matters.

The Creditors Committee says the employment of the firm as
counsel to the Committee, and Morgan, Lewis & Bockius LLP as
special insurance counsel to the Committee, will not result in
the overlap of any services.

The principal attorneys presently designated to represent the
Committee are James I. Stang, Robert B. Orgel, Hamid R. Rafatjoo,
and Gillian Brown.  The principal paralegal presently designated
to represent the Committee is Jorge E. Rojas.

The hourly rates for the Firm's attorneys range from $375 to
$795, and $75 to $210 per hour for paraprofessionals.

    Name                     Hourly Rate
    ----                     -----------
    James I. Stan, Esq.          $695
    Robert B. Orgel, Esq.        $695
    Hamid R. Rafatjoo, Esq.      $450
    Gillian N. Brown, Esq.       $400
    Jorge E. Rojas               $145

The Firm has received no retainer in the Diocese's Chapter 11
case.

Mr. Stang assures the Court that neither the firm nor any of its
attorneys represent any interest adverse to that of the Committee
in the matters on which they are to be retained, and the firm's
attorneys are disinterested persons under Section 101(14) of the
Bankruptcy Code.

The Roman Catholic Diocese of San Diego in California --
http://www.diocese-sdiego.org/-- employs approximately
3,000 people in various areas of work.  The Diocese filed for
Chapter 11 protection just before commencement of the first of
court proceedings for 140 sexual abuse lawsuits filed against the
Diocese.  Authorities of the San Diego Diocese said they were not
in favor of litigating their cases.

The San Diego Diocese filed for chapter 11 protection on Feb. 27,
2007 (Bankr. S.D. Calif. Case No. 07-00939).  Gerald P. Kennedy,
Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents
the Diocese.  In its schedules of assets and liabilities, the
Diocese listed total assets of $152,510,888 and total liabilities
of $72,754,092.

The Diocese's exclusive period to file a chapter 11 plan of
reorganization expires on June 27, 2007.  On March 27, 2007, the
Debtor filed its plan and disclosure statement.  (Catholic Church
Bankruptcy News, Issue No. 92; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CENTRAL PARKING: Equity Group Completes $1 Billion Acquisition
--------------------------------------------------------------
Kohlberg & Company, Lubert-Adler Partners, and Chrysalis Capital
Partners have completed their acquisition of Central Parking
Corporation in a $1 billion transaction.

At a special meeting held on May 21, 2007, the shareholders of
Central Parking voted to approve the proposed transaction that the
company agreed to on Feb. 20, 2007.  Holders of shares
representing approximately 88% of Central Parking's total
outstanding voting shares and over 99% of the total votes cast
voted in favor of the transaction.

Emanuel J. Eads, Central Parking's president and chief executive
officer, said, "We are pleased with the overwhelming endorsement
of this transaction by our shareholders.  We look forward to
working with our new owners and our management team to continue to
provide the highest levels of customer service in the industry."

Greg Segall, Managing Partner of Chrysalis Capital Partners, said,
"We look forward to working closely with Central Parking's veteran
management team and dedicated work force to enhance the company's
industry-leading platform and take advantage of the substantial
opportunities available to maximize the company's excellent and
strategic pool of assets."

Gordon Woodward, Principal with Kohlberg & Co., said, "The company
is well positioned for the future and we are excited to work with
management going forward."

Goldman Sachs and RBS Greenwich Capital provided the debt
financing for the transaction, while UBS Investment Bank acted as
financial advisor to the investor group.

                    About Kohlberg & Company

Based in Mt. Kisco, New York, Kohlberg & Company L.L.C.
-- http://www.kohlberg.com/-- is a leading U.S. private equity   
firm with offices in Mt. Kisco, New York and Palo Alto,
California.  Since its inception in 1987, Kohlberg has completed
over 90 platform and add-on acquisitions as the control investor
in a variety of industries, including infrastructure,
manufacturing, healthcare, consumer products and service
industries.  Kohlberg has invested a total of $1.6 billion in
equity across five private equity funds with an aggregate
transaction value of approximately $6 billion.

               About Chrysalis Capital Partners

Chrysalis Capital Partners L.P. -- http://www.ccpfund.com/-- is   
a private equity firm managing $300 million of committed
capital and focused on control investments in special situations
involving middle-market companies in a wide variety of
industries across the United States.

                   About Lubert-Adler Partners

Lubert-Adler Partners, L.P. -- http://www.lubertadler.com/-- is   
a real estate private equity firm headquartered in Philadelphia
with offices in New York, Los Angeles, London, Atlanta, and
Baltimore. Lubert-Adler was founded in 1997 and has raised over
$4 billion of equity across five funds and has invested in
over $20 billion of real estate assets.  Lubert-Adler's
current fund -- Fund V -- represents US$1.7 billion of equity
and commenced in 2006.

                      About Central Parking

Based in Nashville, Tennessee Central Parking Corporation (NYSE:
CPC) -- http://www.parking.com/-- owns, operates, and manages   
parking and related services including surface and multi-level
parking facilities, design consultation, customer and employee
shuttle services, valet and special event parking, parking meter
enforcement, toll-road collections, and parking notice and
collection services.  As of Dec. 31, 2006, Central Parking
operates more than 3,100 parking facilities containing over
1.5 million spaces at locations in 37 states, the District of
Columbia, Canada, Puerto Rico, the United Kingdom, the Republic
of Ireland, Chile, Colombia, Peru, Spain, Switzerland, and
Greece.

                          *     *     *

As reported in the Troubled Company Reporter on May 1, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Nashville, Tennessee-based Central Parking Corp. to 'B'
from 'B+', and removed the ratings from CreditWatch with negative
implications.  Standard & Poor's also assigned its bank loan and
recovery ratings to CPC's proposed first- and second-lien credit
facilities.

As reported in the Troubled Company Reporter on May 2, 2007,
Moody's Investors Service assigned provisional ratings to KCPC
Acquisition, Inc. in connection with the pending leveraged buyout
of Central Parking Corporation.

Moody's assigned a provisional (P)B2 Corporate Family Rating, a
(P)Ba2 rating to the proposed $355 million first lien credit
facility and a P(B2) rating to the proposed $50 million second
lien term loan facility.


CIT HOME: S&P Cuts Ratings on 2002-1 Class BV Certificates to BB
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class BV
from CIT Home Equity Loan Trust 2002-1 to 'BB' from 'BBB' and
placed it on CreditWatch with negative implications.  The 'B'
rating on class BF remains on CreditWatch with negative
implications, where it was placed Sept. 5, 2006.  In addition, S&P  
affirmed the ratings on 10 other classes from this transaction.
     
The lowered rating and CreditWatch placement are due to monthly
realized losses that have regularly exceeded monthly excess
spread, causing overcollateralization to fall to $1.33 million,
below its target of $2.294 million.  In addition, loss projections
show that this trend could continue and further erode credit
support to this class.  As of the April 2007 distribution date,
cumulative losses were 4.01% of the original pool balance.  In
addition, total delinquencies were 46.92% of the current pool
balance, and 90-plus-day delinquencies were 33.69%.
     
Standard & Poor's will closely monitor the performance of this
transaction.  If losses decline to a point at which they no longer
exceed monthly excess spread, and credit support has not been
further eroded, S&P will affirm the ratings on classes BF and BV
and remove them from CreditWatch.  Conversely, if losses continue
to outpace excess interest, further negative rating actions can be
expected.
     
The affirmation of the ratings on the 10 remaining classes from
this transaction reflect adequate actual and projected credit
support provided by subordination, excess interest, and O/C,
despite the poor collateral performance.
     
The underlying collateral for this transaction originally
consisted of subprime fixed- and adjustable-rate first and second
liens on owner-occupied one- to four-family residences.
  

          Rating Lowered and Placed on Creditwatch Negative
   
                  CIT Home Equity Loan Trust 2002-1

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


             Rating Remaining on Creditwatch Negative

                CIT Home Equity Loan Trust 2002-1

                         Class    Rating
                         -----    ------
                          BF      B/Watch Neg
    

                          Ratings Affirmed
   
                 CIT Home Equity Loan Trust 2002-1
             
                       Class            Rating
                       -----            ------
                       AF-4, AF-5       AAA
                       AF-6, AF-7, AV   AAA
                       MV-1             AA+
                       MF-1,            AA
                       MF-2, MV-2       A


COLLINS & AIKMAN: Judge Rhodes Eyes Judy O'Neill as Fee Examiner
----------------------------------------------------------------
The Hon. Steven Rhodes of the U.S. Bankruptcy Court for the
Eastern District of Michigan intends to appoint Judy A. O'Neill, a
partner at Foley & Lardner, LLP, in Detroit, Michigan, as fee
examiner pursuant to Rule 706 of the Federal Rules of Evidence and
Section 105 of the Bankruptcy Code, in Collins & Aikman Corp. and
its debtor-affiliates' chapter 11 cases.

Judge Rhodes previously sought statements from interested parties
as to whether the Court should appoint a fee examiner, in light
of certain concerns raised by Third Avenue Trust, the Debtors'
largest unsecured creditor.  Third Avenue had claimed that the
fees charged by professionals hired in the Chapter 11 cases are
excessive given that the cases were proceeding down the path of
liquidation rather than reorganization.

The Debtors, the Official Committee of Unsecured Creditors, and
KZC Services, LLC, stated that the appointment of a fee examiner
at this "late stage" in the Chapter 11 cases is unwarranted.  

JPMorgan Chase Bank, N.A., as administrative agent for the
Debtors' prepetition senior, secured lenders, supported Third
Avenue's request for an appointment of a fee examiner but said
that any fee examiner should work on a limited budget to avoid
draining the Debtors' resources.

The U.S. Trustee, on the other hand, requested for an appointment
an examiner under Section 1104 to investigate, among others, the
merits of Third Avenue's allegations, and whether management took
appropriate steps to manage costs, including professional fees
and expenses.

     Judge Rhodes: "Magnitude" of Fees Warrant Appointment

In large or particularly complex cases, the Court may appoint a
fee examiner pursuant to Section 105 or Rule 706(a) to assist the
Court in carrying out its duties on reviewing fee applications.

The Court concludes that the magnitude of the fees in the case
and the importance and complexity of the questions raised by
JPMorgan and Third Avenue, make it necessary and appropriate to
appoint a fee examiner to assist the Court in carrying out its
responsibility to examine fees.

As of May 4, 2007, the more than 20 firms have hired in the
Chapter 11 cases requested payment of fees aggregating at least
$88,000,000.  The fees sought are expected to increase before the
bankruptcy cases conclude.

Third Avenue Trust and JPMorgan doubted whether "professionals
appropriately reduced and adjusted their activities in view of
the changing circumstances affecting the Debtors and the Chapter
11 cases."  

Third Avenue Trust noted that the retained professionals continue
to labor, and bill for services, as if the Debtors could still be
reorganized in the manner first envisioned when the Debtors filed
their bankruptcy petitions.  Third Avenue resigned from the
Creditors Committee in large part due to its opinion that the
professionals advising the committee were not creating additional
material recoveries for the unsecured creditors, but were
continuing to bill large amounts of unnecessary fees.

"It is clearly in the best interests of creditors and the estate
for the examiner to investigate the questions raised by JPMorgan
and Third Avenue Trust," Judge Rhodes rules.

The Court, however, rules that there is no cause for a fee
examiner to conduct a detailed line-by-line investigation of each
fee application.  Third Avenue had suggested that the fee
examiner conduct a detailed line-by-line investigation of each
fee application looking for duplicative efforts, wasteful
expenses and transient billers.

                 Scope and Duties of Fee Examiner

Judge Rhodes intends to enter an order providing that the fee
examiner will:

   (a) review records, reports, pleadings or other papers to
       investigate the reasonableness of requests for fees and
       expenses, and to report on her conclusions; and

   (b) prepare and file a report summarizing her findings within
       90 days of her appointment.  

Judge Rhodes says that the fee examiner may request an extension
to her 90-day deadline to submit a report for good cause.  
Parties-in-interest will have 30 days to file a response to the
report.

The scope of the fee examiner's review will include fee
applications of all professionals employed pursuant to Sections
327, 328 or 1103 of the Bankruptcy Code; claims for reimbursement
of professional fees and expenses under Section 503(b); and
requests for reimbursement of expenses by a member of any
official committee.

The fee examiner may retain the services of a disinterested
professional business consultant to assist her in analyzing
financial statements and business records or for any other
relevant purpose.

To determine the reasonableness of requests for fees and
expenses, Judge Rhodes says that it is necessary to determine
answers to these questions:

   (a) Should the substantial operational, managerial and
       financial problems at the Debtors' Plastics division and
       the resultant near impossibility of the Plastics division
       achieving management's business plan goals have been        
       discovered earlier?

   (b) If so, did the delay result in either unnecessary losses
       or reductions in creditor recoveries?

   (c) Once it became reasonably clear that the value of the
       Debtors' estate was substantially diminished or that a
       reorganization was unlikely, did any of the  estate
       professionals undertake or continue work on activities
       that no longer were reasonably necessary under the
       circumstances and in view of their roles?

      Judge Rhodes Declines to Appoint Sec. 1104 Examiner

Judge Rhodes denies the U.S. Trustee's request for an examiner
under Section 1104(c)(2) on grounds that it has not requested an
investigation of the Debtors.

"The primary investigation requested relates not to the debtors
directly but rather to the conduct of the debtors' professionals
and the professionals of the official unsecured creditors
committee," he points out.

Judge Rhodes rules that the U.S. Trustee's request clearly
reflects a request to appoint a fee examiner.  

                Judge Rhodes Selects Fee Examiner

Various parties have recommended various individuals to take the
role as fee examiner should the Court decide to appoint one:

  (1) Third Avenue Trust: Ira Bodenstein, partner at Shaw Gussis
      Fishman Glantz Wolfson & Towbin LLC;

  (2) JPMorgan: Wallace M. Handler of Sullivan, Ward, Bone, Tyler
      & Asher, P.C., in combination with any of:

       (a) Joseph Patchan a former bankruptcy judge and director
           of the Executive Office for U.S. Trustees

       (b) Richard S. Toder of Morgan, Lewis & Bockius LLP

       (c) Professor James J. White of The University of Michigan
           Law School
   
  (3) the Creditors Committee:

        1. Robert F. Troisio of Morris Anderson Associates Ltd.

        2. Stephen Bossay of Warren Smith & Associates

  (4) Debtors:

        x. Warren Smith at Warren Smith & Associates

        y. Wallace M. Handler at Sullivan, Ward, Bone, Tyler &
           Asher, P.C.

Judge Rhodes, however, has named Judy A. O'Neill, Esq., at Foley
& Lardner, LLP, in Detroit, Michigan, to act as a special
consultant and witness for professional fee and expense review
and analysis.

Ms. O'Neill has served as debtor's counsel for other large
industry auto cases similar to the Debtors, including Pilot
Industries, Inc., Oxford Automotive, Inc., and Venture Holdings
Company LLC.  She has also represented debtors, lenders,
customers and creditors' committees in many other automotive
Chapter 11 cases over the past 27 years both in the Eastern
District of Michigan, Southern Division and in other
jurisdictions.

"My background also provides me with the experience and
temperament needed to efficiently resolve fee issues.  The
experiences. . . have exposed me to work with every conceivable
constituency in a [C]hapter 11 case, including most, if not all
of these professionals," Ms. O'Neill says.

Ms. O'Neill has also served as a facilitator for the U.S.
Bankruptcy Court for the Eastern District of Michigan for several
years.  "This service has equipped me to bring a pragmatic, goal-
directed approach to the fair resolution of matters.  This
experience will enable me to work constructively with parties in
interest to fairly resolve matters as the fee examiner," she
tells the Court.

Ms. O'Neill's standard rate is $590 per hour.  However, the firm
has agreed to a discount to $550 per hour for the services.  To
the extent other professionals are engaged to assist in this
assignment, the firm will agree to provide discounts of 5% from
its standard rates for the engagement.

Ms O'Neill discloses that the firm has acted as local counsel in
the case to GE Commercial Finance, an equipment lessor and
creditor to some of the Debtors, with the lead role for the
engagement undertaken by Latham and Watkins and Quarles and
Brady.  Fees for that engagement were not paid by the estate.  
She says that GE Commercial is willing to permit Foley &
Lardner's withdrawal as its local counsel.

Moreover, the firm has also been asked by two creditors to defend
asserted or threatened preference actions.  Ms. O'Neill does not
believe that Foley & Lardner's defense in the actions would
conflict with her engagement as fee examiner.  In addition, Foley
& Lardner will establish ethical walls to prevent information
sharing, she says.

        JPMorgan Wants Examiner Fees Capped at $300,000

The Court has sought comments from interested parties' regarding,
among others, his selection of Ms. O'Neill as examiner and the
terms of the appointment of the fee examiner.

JPMorgan requests that the compensation of the fee examiner and
her professionals, Foley & Lardner and any disinterested business
consultant that the fee examiner employs, be limited to the
aggregate amount of $300,000, without prejudice to the fee
examiner's right to seek reconsideration of this cap upon showing
of good cause.

JPMorgan also asks the Court to:

    -- clarify that the fee examiner will have the power to
       conduct interviews as necessary:

    -- permit the legal specialists attorneys within the fee
       examiner's law firm, Foley & Lardner, to perform certain
       of the legal work required of the fee examiner, with the
       attorneys are paid lower hourly rates where appropriate.

A more economical and efficient mechanism for the resolution of
any disputes arising from the fee examiner's report, according to
JPMorgan, would be to provide that the report to be submitted by
the fee examiner within 90 days be a "draft report summarizing
the fee examiner's preliminary findings."  It further suggests
that:

    -- the fee examiner will prepare and circulate the draft
       report to the professionals whose fees are subject to
       examination, as well as to counsel for the United States
       Trustee, the Debtors' internal general counsel, and
       counsel to JPMorgan;

    -- the draft report's recipients will consult with the fee
       examiner during the following 30 day period  in an attempt
       to reach a consensual resolution of any issues raised by
       the fee examiner's draft report;

    -- within 15 days after expiration of the consultation
       period, the fee examiner will file with the Court a final
       report summarizing her findings, including any proposed
       consensual resolution of issues raised in her findings.

       O'Neill Expects Fee Apps. Review to Cost $500,000

Judy A. O'Neill agrees with JPMorgan's suggestions that the Court
clarify that she is allowed to conduct interviews, and retain the
services of her law firm, Foley & Lardner.  Ms. O'Neill explains
that the may retain the services of her firm to more efficiently
and economically accomplish various tasks including, without
limitation, the review of Foley records to prepare the Rule 2014
statement, the review and summary of relevant pleadings, the
preparation of fee statements and applications, and the recording
of information, including witness statements, on which the
examiner's report will be based.

Ms. O'Neill, however, suggests that the "cap" on the amount of
fee compensation be set at not less than $500,000.  She expects
these fees to accrue over the 90-day examination period:

  Estimated Fees                                    Total Cost
  --------------                                    ----------
  Proposed Examiner ($550/hr discounted rate)
  @ 8 hrs per day for 60 working days                 $264,000

  Foley Sr. Associate ($422.75/hr discounted rate)
  @ 8 hours per day for 45 working days               $152,190

  Foley Paralegal ($150/hr rate)
  @ 3 hours per day for 10 working days = $13,500

  Business Consultant Fees                             $70,000
                                                      --------
           Total                                      $499,690
                                                      ========

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

On Aug. 30, 2006, the Debtors filed their Chapter 11 Plan and
Disclosure Statement.  On Dec. 22, 2006, they filed an Amended
Joint Chapter 11 Plan.  The Court approved the adequacy of the
Amended Disclosure Statement.  The Court has adjourned the hearing
to consider confirmation of the Amended Joint Plan to June 5,
2007.  (Collins & Aikman Bankruptcy News, Issue No. 61; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000).


COMM COMMERCIAL: Fitch Affirms Low B Ratings on $23.5-Mil. Certs.
-----------------------------------------------------------------
Fitch Ratings upgrades two classes of COMM commercial mortgage
pass-through certificates, series 2000-C1, as:

     -- $25.8 million class E to 'AAA' from 'AA+';
     -- $11.2 million class F to 'AA' from 'AA-'.

In addition, Fitch affirms these classes:

     -- $518.9 million class A-2 at 'AAA';
     -- Interest only class X at 'AAA';
     -- $38.1 million class B at 'AAA';
     -- $39.2 million class C at 'AAA';
     -- $13.5 million class D at 'AAA';
     -- $26.9 million class G at 'BBB';
     -- $6.7 million class H at 'BB+';
     -- $6.7 million class J at 'B+';
     -- $10.1 million class K at 'B'.

Fitch maintains class L at 'CCC/DR1', class M at 'C/DR6', and
class N at 'C/DR6'.  Fitch does not rate the $76 thousand class O
certificates. Class A1 paid in full.

The rating upgrades reflect increased credit enhancement due to
additional defeasance (8.6%) since Fitch's last rating action.  As
of the May 2007 distribution date, the pool's aggregate
certificate balance has decreased (18.5%) to $716.5 billion from
$897.9 billion at issuance.  To date, 29 loans (32.4%) have fully
defeased.

The rating affirmations are the result of loss expectations on the
specially serviced assets.  Fitch projected losses on the
specially serviced assets are expected to fully deplete classes O
and N and significantly impair class M.

Fitch is closely monitoring the 29 Fitch Loans of Concern (21.7%)
in the pool.  These include the specially serviced loans and loans
with low debt service coverage ratios and occupancies.  Currently,
there are five assets (6.59%) in special servicing. The largest
asset (3.2%) is a real estate-owned multifamily property in
Fairfield, Ohio.  The loan is split into an A-note portion, which
is in the trust, and a B-note, with a current balance of $14.68
million, held outside the trust.  The loan transferred to special
servicing in March 2005 as a result of insufficient property cash
flow.  Sale proceeds from the first seven properties were applied
to cure all outstanding advances with the remaining amount applied
to principal and the loan now has a remaining exposure of $9.5
million.  Currently, the special servicer is implementing a
capital repairs/improvement program expected to be completed by
the end of June 2007 before marketing the property for sale.

The largest non-specially serviced Loan of Concern (2.6%) is
secured by three office buildings in various cities in Maryland
and Virginia.  The three properties have reported drops in
occupancies, driving a decline in property performance.  
Consolidated occupancy as of June 2006 was 64.2%.  Fitch will
continue to monitor the performance of the collateral.

Fitch reviewed the credit assessments of the Crystal Park One (5%)
loan.  The Fitch stressed DSCR is calculated using servicer-
provided net operating income less required reserves divided by
debt service payments based on the current balance using a Fitch
stressed refinance constant.  The loan maintains a credit
assessment.

The Crystal Park One loan is secured by a 416,524 square foot
(SF), 11-story office building located in the Crystal City section
of Arlington, Virginia.  This loan has an A and B-note structure,
where the B-note, with a current balance of $12.6 million, is held
outside the trust.  As of March 31, 2007, the property was 94.2%
occupied. The A-note corresponding DSCR as of the year-end 2006
was 2.60x, compared with 1.57x at YE 2004 and 1.95x at issuance.


COMMUNICATIONS CORP: Disclosure Statement Inadequate Says Bank
--------------------------------------------------------------
Bank of Montreal objects to the adequacy of a proposed disclosure
statement explaining the Chapter 11 Plan of Reorganization of
Communications Corporation of America and its debtor-affiliates
and White Knight Holdings Inc. and its debtor-affiliates.

BOM is a party to a collateral agency, intercreditor and
subordination agreement as of June 4, 2007, with General Electric
Capital Corporation, the Debtors' secured holder.

In a document filed May 14, 2007, BOM points out that the Debtors'
Disclosure Statement failed to:

     -- provide basis for the Plan's classification of
        contractually subordinated creditors in the same
        class as the BOM subordinated noteholders;

     -- provide adequate information regarding the bases for
        the valuation of the GE Lenders Secured Claim or the
        Assumption of Financial Growth Contained in the Pro
        Forma Statement;

     -- disclose relationships with non-debtor affiliates
        and principals;

     -- describe any legal or factual basis for substantive
        consolidation; and

     -- disclose proper treatment of preferred and common
        stockholders.

                       Overview of the Plan

The Plan, published in the Troubled Company Reporter on March 19,
2007, provides for:

   (a) the continued operation and renewed growth of the Debtors'
       businesses;

   (b) the restructure and rationalization of the Debtors'
       capital structure;

   (c) the recapitalization of the Debtors for additional
       liquidity; and

   (d) payments to creditors in accordance with terms of the
       Plan.

The Debtors will fund the Plan through a combination of:

   (1) the sale of assets for $75 million,

   (2) a capital infusion of $10 million from the present owners
       of Communications Corporation of America Inc. and White
       Knight Holdings Inc., and

   (c) revenues derived from continued operations.

The net sale proceeds will be paid to GE Lenders Secured Claims.
The estimated allowed amount of the GE Lenders Secured Claim is
$206 million.  The claim is subject to valuation by the Court.

Allowed Administrative Claims, Priority Tax Claims, Priority
Claims, Other Secured Claims, Convenience Claims, and Unsecured
Trade Claims will be paid in full.

The total estimate of outstanding unpaid Administrative Expense
Claims is in the range of $5.8 million to $6.3 million; Priority
Tax Claims, $0; Priority Claims, $0; Other Secured Claims,
$16,000; Convenience Class Claims, $95,000; and Unsecured Trade
Claims, $900,000 to $1.1 million.

Holders of General Unsecured Claims will recover 3%.  The
estimated amount of Allowed General Unsecured Claims is
$170,000,000.

The holders of equity interests in the Debtor Subsidiaries
will retain their equity interests.  Preferred Interests in
Communications Corporation of America Inc. will receive a cash
distribution equal to the holder's pro rata share of $50,000.
Holders of common equity interests in the Parent companies won't
receive anything under the Plan.

A full-text copy of the Debtors' Disclosure Statement is available
for free at http://ResearchArchives.com/t/s?1b86

                        About White Knight

Headquartered in Lafayette, Louisiana, White Knight Holdings,
Inc., is a media, television and broadcasting company.

White Knight entered into commercial inventory agreements, joint
sales agreements, and shared services agreements with
Communications Corporation of America.  However, both entities are
independent companies and are not affiliates of each other.  Along
with Communications Corp., White Knight operates around 23 TV
stations.

White Knight and five of its affiliates filed for chapter 11
protection on June 7, 2006 (Bankr. W.D. La. Case Nos. 06-50422
through 06-50427).  R. Patrick Vance, Esq., and Matthew T. Brown,
Esq., at Jones, Walker, Waechter, Poitevent, Carrere & Denegre,
LLP, represents White Knight and its debtor-affiliates in their
restructuring efforts.  White Knight and its debtor-affiliates'
chapter 11 cases are jointly administered under Communication
Corporation of America's chapter 11 case.

When the Debtors filed for protection from their creditor, they
estimated less than $50,000 in assets and estimated debts between
$100,000 and $500,000.

              About Communications Corp. of America

Headquartered in Lafayette, Louisiana, Communications Corporation
of America, is a media and broadcasting company.  Along with media
company White Knight Holdings, Inc., it owns and operates around
23 TV stations in Indiana, Texas and Louisiana.  Communications
Corporation and 10 of its affiliates filed for bankruptcy
protection on June 7, 2006 (Bankr. W.D. La. Case Nos. 06-50410
through 06-50421).  Douglas S. Draper, Esq., William H. Patrick
III, Esq., and Tristan Manthey, Esq., at Heller, Draper, Hayden,
Patrick & Horn, LLC, represents Communications Corporation and its
debtor-affiliates.  Taylor, Porter, Brooks & Phillips LLP serves
as counsel to the Official Committee of Unsecured Creditors.  When
Communications Corporation and its debtor-affiliates filed for
protection from their creditors, they estimated assets and debts
of more than $100 million.


CONGOLEUM CORP: Asbestos Insurers Not Obligated to Pay, Court Says
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey issued a
decision in Phase I of Congoleum Corporation's trial addressing
disputes regarding insurance coverage for asbestos liabilities.  
In its decision, the Court found out that Congoleum's insurers
were not obligated to provide coverage for the settlement
agreement covering numerous claimants with asbestos claims against
the Debtor.

Roger S. Marcus, Chairman of the Board, commented, "The judge
presiding over our reorganization proceedings has already made it
clear that she would not confirm a plan that honored the terms of
the settlement agreement addressed by this state court decision.
This decision further confirms the issues created by that
agreement, and provides additional guidance on the steps we can
take to comply with the bankruptcy court's rulings and decisions.
We are proceeding with those steps so we can move ahead with a
plan that complies with all necessary legal requirements and
enables us to complete our reorganization."

Mr. Marcus concluded by saying, "In addition to resolving the
issues posed by the settlement agreement, we are also in active
mediation discussions to reach agreement on other terms of our
next reorganization plan. I believe we are making progress, and
hope we will have a new plan filed with the bankruptcy court later
this year."

                      About Congoleum Corp.

Based in Mercerville, New Jersey, Congoleum Corporation (AMEX:CGM)
-- http://www.congoleum.com/-- manufactures and sells resilient    
sheet and tile floor covering products with a wide variety of
product features, designs and colors.  The Company filed for
chapter 11 protection on Dec. 31, 2003 (Bankr. N.J. Case No.
03-51524) as a means to resolve claims asserted against it related
to the use of asbestos in its products decades ago.

Paul S. Hollander, Esq., and Gregory S. Kinoian, Esq., at Okin,
Hollander & Deluca, L.L.P., represent the Debtors.  Nancy
Isaacson, Esq., at Goldstein Isaacson, PC, represents the Official
Committee of Unsecured Creditors.  At March 31 2007, Congoleum
reported $180,091,000 in total assets and $226,990,000 in total
liabilities, resulting in a stockholders' deficit $46,899,000.

The Futures Claimants Representative is represented by Stephen B.
Ravin, Esq., and Bruce J. Wisotsky, Esq., at Ravin Greenberg PC.

American Biltrite, Inc., which owns 55% of Congoleum, is
represented by Matthew Ward, Esq., Mark S. Chehi, Esq.,
Christopher S. Chow, Esq., and Matthew P. Ward, Esq., at
Skadden Arps Slate Meagher & Flom.


CRESCENT REAL: To Be Acquired by Morgan Stanley for $6.5 Billion
----------------------------------------------------------------
Crescent Real Estate Equities Company has entered into a
definitive agreement in which funds managed by Morgan Stanley Real
Estate will acquire Crescent in an all cash transaction for $22.80
per share, and the assumption of liabilities for total
consideration of approximately $6.5 billion.

The purchase price represents a 12% premium over Crescent's prior
30-day average closing share price.  The total consideration for
the acquisition includes the assumption and refinancing of
approximately $3.1 billion of the company's outstanding
consolidated and unconsolidated debt and redemption of the
company's outstanding Series A and Series B preferred shares,
which have an aggregate liquidation preference of approximately
$440 million.  Pursuant to the terms of the agreement, Crescent
will not pay any further dividends on the common shares.

John C. Goff, Crescent's vice-chairman and chief executive
officer, said, "The primary goal of the strategic plan we
announced on March 1, 2007 was to maximize value for our
shareholders.  This transaction accelerates the realization of
that goal by delivering value to our shareholders more quickly and
with greater certainty.  We are delighted to announce this
agreement and we look forward to working closely with Morgan
Stanley Real Estate on a transition that will be seamless for our
customers, partners and employees."

Commenting on the transaction, Michael Franco, Managing Director
and co-head of Morgan Stanley Real Estate Investing (Americas)
said, "We are pleased to enter into this agreement to acquire
Crescent Real Estate Equities.  Crescent is a unique company
operating in a wide range of business lines that are familiar to
Morgan Stanley.  We recognize the valuable contributions that
Crescent's people have made to build the company's franchise and
we look forward to working closely with them on a smooth
transition."

The transaction has been unanimously approved by the company's
Board of Trust Managers, which will recommend that the common
shareholders approve the transaction.  Mr. Richard E. Rainwater
has entered into a voting agreement whereby he has agreed to vote
in favor of the transaction.  Completion of the transaction, which
is expected to occur by the end of the third quarter of 2007, is
subject to approval by the company's common shareholders, as well
as to certain other customary closing conditions.  The exact
timing of the closing of the transaction is dependent on the
review and clearance of necessary filings with the Securities and
Exchange Commission and other governmental authorities.

Greenhill & Co., LLC acted as the financial advisor to Crescent,
while Pillsbury Winthrop Shaw Pittman LLP provided legal advice.
Morgan Stanley acted as financial advisor to Morgan Stanley Real
Estate with Goodwin Procter LLP and Jones Day acting as legal
counsel.

                    About Crescent Real Estate

Based in Fort Worth, Texas, Crescent Real Estate Equities
Company (NYSE: CEI) -- http://www.crescent.com/-- is a real   
estate investment trust.  Through its subsidiaries and joint
ventures, Crescent owns and manages a portfolio of 71 premier
office buildings totaling 28 million square feet located in select
markets across the United States with major concentrations in
Dallas, Houston, Austin, Denver, Miami, and Las Vegas.  Crescent
also strategically invests in resort-residential developments and  
in destination resorts such as Fairmont Sonoma Mission Inn(R) in
Sonoma, California; and in the wellness lifestyle leader, Canyon
Ranch(R).

                          *     *     *

Moody's Investors Service assigned a B3 rating to Crescent Real
Estate Equities Company's preferred stock on Nov. 11, 2004.

Standard & Poor's assigned a BB- long-term foreign and local
issuer credit rating to Crescent Real Estate Equities Company on
June 30, 2004.


CSFB MORTGAGE: Fitch Affirms Low B Ratings on $32.3-Mil. Certs.
---------------------------------------------------------------
Credit Suisse First Boston Mortgage Securities Corp., series 2005-
C1 commercial mortgage pass-through certificates are affirmed by
Fitch Ratings as:

     -- $84.8 million class A-1 at 'AAA';
     -- $125.5 million class A-2 at 'AAA';
     -- $113.1 million class A-AB at 'AAA';
     -- $181.6 million class A-3 at 'AAA';
     -- $674.3 million class A-4 at 'AAA';
     -- $92.5 million class A-J at 'AAA';
     -- Interest-only class A-X at 'AAA';
     -- Interest-only class A-SP at 'AAA';
     -- $43.4 million class B at 'AA';
     -- $13.2 million class C at 'AA-';
     -- $24.5 million class D at 'A';
     -- $18.9 million class E at 'A-';
     -- $20.8 million class F at 'BBB+';
     -- $15.1 million class G at 'BBB';
     -- $18.9 million class H at 'BBB-';
     -- $5.7 million class J at 'BB+';
     -- $5.7 million class K at 'BB';
     -- $5.7 million class L at 'BB-';
     -- $5.7 million class M at 'B+';
     -- $5.7 million class N at 'B';
     -- $3.8 million class O at 'B-'.

Fitch does not rate the $22.7 million class P.

The rating affirmations reflect the transaction's stable
performance and minimal paydown since issuance.  As of the May
2007 distribution date, the pool has paid down 1.9% to $1.48
billion from $1.51 billion at issuance.  There are currently two
loans (0.7%) in special servicing, one is in foreclosure and one
is current.

The largest specially serviced loan (0.4%) is a multifamily
property located in Seattle, Wash.  The loan was recently brought
current and is pending return to the master servicer.


CWABS ASSET: Moody's May Downgrade Ba1 Rating After Review
----------------------------------------------------------
Moody's Investors Service placed under review for possible
downgrade four classes of certificates from two CWABS Asset-Backed
Certificates Trust deals issued in 2006.  The transactions are
backed primarily by first lien adjustable- and fixed-rate mortgage
loans.

These ratings are being reviewed based on a higher than
anticipated rate of delinquency in the underlying collateral
current compared to current credit enhancement levels.

The complete rating actions are:

   * Issuer: CWABS Asset-Backed Certificates Trust 2006-10

     -- Class MV-9, current rating Baa3, under review for
        possible downgrade;

     -- Class BV, current rating Ba1, under review for possible
        downgrade;

Issuer: CWABS Asset-Backed Certificates Trust 2006-ABC1

     -- Class M-7, current rating Baa1, under review for
        possible downgrade;

     -- Class M-8, current rating Baa2, under review for
        possible downgrade.


DELPHI CORP: Wants Court Nod on $10.5 Million Umicore Settlement
----------------------------------------------------------------
Delphi Corp. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of New York to approve their
settlement agreement with Umicore Autocat Canada Corp..

In October 2005, Umicore submitted a demand to the Debtors
asserting a reclamation claim for $2,742,819.

In July 2006, Umicore filed Claim No. 12924 against Delphi
Automotive Systems, LLC, asserting a $10,671,101 unsecured non-
priority claim and an unliquidated unsecured priority claim for
goods and services delivered to DAS.

Upon review of their books and records and the supporting
documentation provided by Umicore, the Debtors have determined
that they only owe Umicore $10,558,893.

After arm's-length bargaining, the Parties arrived at a
settlement agreement that provides for the full resolution of
Umicore's Claims.

Under the Settlement Agreement, the Debtors agree to allow Claim
No. 12924 as a prepetition general unsecured non-priority claim
for $10,558,893, without further defense, set-off or reduction.  
For its part, Umicore agrees to withdraw its Reclamation Demand
with prejudice.

The Settlement Agreement will avoid costly litigation of
Umicore's Claims, John Wm. Butler, Jr., Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in Chicago, Illinois, tells the Court.

The Debtors aver that the Settlement Agreement is in the best
interest of their estates and their creditors.

                     About Delphi Corporation

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
Mar. 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.  The Debtors'
exclusive plan-filing period expires on July 31, 2007.  (Delphi
Corporation Bankruptcy News, Issue No. 69; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000).


DELPHI CORP: Wants Claims Settlement Procedures Supplemented
------------------------------------------------------------
Delphi Corp. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of New York to supplement its
previously issued order on settlement procedures to clarify that
the Debtors are authorized to settle claims:

   (a) against the estates of specific Debtor entities; and

   (b) with a priority or status different from that which was
       asserted by claimants.

The Debtors further ask to Court to rule that the Supplemental
Settlement Procedures Order will be effective nunc pro tunc to
June 29, 2006, in order to protect the soundness of their
consummated settlements since that time.

The Debtors had previously obtained the Court's authority to
establish and enforce certain guidelines and notice procedures
that enable the Debtors, without further Court approval, to:

    (i) settle disputes in commercial transactions and other
        circumstances outside the ordinary course of business; and

   (ii) allow certain claims.

The Court entered the Claims Settlement Procedures Order on
June 29, 2006.

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, notes that the Claims Settlement
Procedures Order does not expressly authorize the Debtors to:

   (1) allow, nor does it expressly prohibit the Debtors from
       allowing, claims against specific Debtor entities and
       their estates; and

   (2) characterize claims as having a priority or other status
       different from that originally asserted by the claims.

The Debtors, however, believe that that authority is inherent in
the relief granted by the Claims Settlement Procedures Order.  
Thus, since the entry of the Order, they have utilized the Claims
Settlement Procedures to enter into agreements with claimants
that allow prepetition claims against the estates of specific
Debtor entities rather than against the Debtors as a whole, and
that characterize claims with a status different from that which
was asserted by the claimants.

Mr. Butler relates that specifying the estate against which each
prepetition claim will be allowed is a necessary part of settling
prepetition claims because the Debtors' estates are not
substantively consolidated, and because the Debtors often dispute
the specific estate against which certain claims are asserted.

The Debtors' ability to assign a claim with a status different
from that originally asserted is also a necessary part of the
claims settlement process because the characterization of a
prepetition claim is a key component to any claim settlement, and
because the Debtors often dispute the claim classification
asserted by claimants, Mr. Butler tells the Court.

                     About Delphi Corporation

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
Mar. 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.  The Debtors'
exclusive plan-filing period expires on July 31, 2007.  (Delphi
Corporation Bankruptcy News, Issue No. 69; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000).


DOLLAR THRIFTY: Moody's Rates $600 Million Credit Facility at B1
----------------------------------------------------------------
Moody's Investors Service assigned a B1 Corporate Family Rating to
Dollar Thrifty Automotive Group, Inc. and a B1 (LGD3, 43) rating
to the company's $600 million secured bank credit facility which
includes a $350 million revolving credit facility and a $250
million term loan.  Moody's also assigned the company a
speculative grade liquidity rating of SGL-2.  The outlook is
stable.

The B1 corporate family rating recognizes DTG's strong position in
the leisure segment of the on-airport car rental market, the
modest but relatively steady share gains it has achieved, and
Moody's expectation that the pricing environment in the on-airport
market will be moderately less intense than in the past due to the
increasing focus by most competitors on enhancing profitability
rather than gaining share.  The rating also acknowledges DTG's
ability to generate return and debt protection measures that are
broadly in line with those of its peers.  The average rating of
these peers is approximately Ba2.

Despite these credit positives, DTG faces a number of competitive
challenges that strongly contribute to the assignment of a B1
corporate family rating.  These challenges include the company's
modest position in the corporate on-airport market, and its even
smaller position in the increasingly important off air-port
market.  Moody's believes that DTG's significant concentration in
the on-airport leisure sector, combined with its very limited
positions in the on-airport corporate sector and the off-airport
market, could inhibit its growth opportunities and increase its
vulnerability to cyclical downturns in the travel sector.  This
business position also represents a competitive disadvantage
relative to its peers, all of whom have a more balance mix of
business and are much larger.

DTG must also contend with risk factors impacting the entire car
rental sector.  These risks include the inherent cyclicality of
the travel industry, as well as the decision by domestic vehicle
OEMs to reduce their level of shipments to the daily-rental
market.  As a result of this decision, DTG and its competitors are
contending with rising vehicle costs, and the need to purchase
more "risk vehicles" for which they bear the price-risk when
vehicles in their fleets are liquidated.  As a result of the
rising level of risk vehicles and the declining credit quality of
domestic OEMs, the car rental sector is also facing the burden of
higher enhancement levels for rental fleet securitization
programs.  DTG's $250 million term loan essentially pre-funds
higher enhancement levels that it will likely face for its
securitizations during the next two years.

The reduced availability of vehicles and the declining credit
quality of OEM have also narrowed near-term profit margins for DTG
and the car rental sector.  However, Moody's expects that margins
will begin to recover as the industry gradually raises prices,
extends the holding period of vehicles, and increases the purchase
of risk vehicles.

DTG's key credit metrics for 2006 include: EBITDA margin of 44.6%;
EBIT/interest of 1.5x; EBITDA/interest of 4.5x; debt/EBITDA of
4.5x; and EBITA/average assets of 5.7%.  In Moody's view, these
metrics are fairly consistent with the Ba2 rating average for its
peer group.  The rating agency expects that during 2007 DTG's
metrics, as well as those of its peers, will improve modestly as
initiatives to address rising fleet costs begin to take hold.  
Consequently, on a metrics comparison basis DTG should maintain
its current position relative to its peers.  Nevertheless, Moody's
has assigned DTG a corporate family rating of B1 due to the
company's more challenged business position.

The SGL-2 rating anticipates that the company's $190 million in
unrestricted cash balances, in combination with approximately $175
million in availability under the $350 million revolver (after
taking account of utilization for letters of credit) will provide
sound liquidity over the coming twelve months.  The rating agency
notes that proceeds from the $250 million term loan will also
contribute to near-term liquidity.  However, these proceeds are,
over time, expected to be needed to fund increased enhancement
requirements for the company's securitization transactions.

The stable outlook reflects Moody's expectation that DTG business
position and credit metrics, relative to those of its peers, will
remain near current levels.

The B1 (LGD3, 43) ratings assigned to the $350 million secured
revolving credit facility and the $250 million secured term loan,
reflect the fact that these obligations are secured by all assets
other than the fleet vehicles that secure the company's ABS
transactions, and that there are only modest amounts of junior
debt in DTG's capital structure.  As such, the B1 assigned to the
credit facilities is equivalent to the B1 corporate family rating.

Dollar Thrifty Group, Inc., headquartered in Tulsa, Oklahoma, is
the fifth-largest daily car rental company in the US, and operates
the Dollar Rent A Car and Thrifty Car Rental brands.


DOV PHARMA: Posts Net Loss of $82,376 in Quarter Ended March 31
---------------------------------------------------------------
DOV Pharmaceutical Inc. reported a net loss of $82,376 on revenue
of $8 million for the first quarter ended March 31, 2007, compared
with a net loss of $20.3 million on revenue of $1.4 million for
the comparable period in 2006.  The net loss for the first quarter
of 2007 includes a gain on debt extinguishment of $8.4 million
related to the Exchange Offer.

At March 31, 2007, cash, cash equivalents and marketable
securities totaled $21.4 million.

Revenue for the three months ended March 31, 2007, was comprised
of the $7.5 million received in the first quarter of 2007 from XTL
Biopharmaceuticals Ltd. pursuant to the terms of the license
agreement for bicifadine and from the reimbursement of certain
costs incurred by the company for inventory and services provided
to XTL during a transition period following the execution of the
license agreement.  

Revenue for the three months ended March 31, 2006, was comprised
of $1.4 million of amortization of the $35 million fee the company
received on the signing of the license, research and development
agreement with Merck.  The up-front payment had been deferred and
amortized to revenue over the estimated research and development
period.  In December 2006, the license agreement with Merck was
terminated and the remaining deferred revenue was recognized
during the fourth quarter of 2006, thus no revenue was recorded in
the first quarter of 2007.

Research and development expense decreased $11 million to
$6.9 million for the first quarter of 2007 from $17.9 million for
the comparable period in 2006.  Approximately $10.4 million of the
decrease was associated with decreased clinical development costs
of $10.1 million for bicifadine, $278,000 for DOV 273,547, and
$64,000 for DOV 102,677.   

General and administrative expense increased $503,000 to
$4.5 million for the first quarter of 2007 from $40 million for
the comparable period in 2006.  

License expense was $5.5 million for the first quarter of 2007,
absent in the 2006 quarter.  This is comprised of the $5 million
and $500,000 paid to Wyeth and Elan, respectively, in connection
with the execution of the license agreement with XTL for
bicifadine in January 2007.

In March 2007, the company consummated an Exchange Offer pursuant
to which $67.5 million in principal amount of its outstanding
convertible subordinated debentures were exchanged for 439,784
shares of series C and 100,000 shares of series D convertible
preferred stock and $14.3 million in cash.  A gain on debt
extinguishment of $8.4 million related to the Exchange Offer was
recorded.

At March 31, 2007, the company's balance sheet showed
$27.7 million in total assets, $12.3 million in total liabilities,
and $39.2 million in total convertible preferred stock, resulting
in a $23.8 million total stockholders' deficit.

Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?1ff0

                       Going Concern Doubt

As reported in the Troubled Company Reporter on April 5, 2007,
PricewaterhouseCoopers LLP in Florham Park, N.J., expressed
substantial doubt about DOV Pharmaceutical Inc.'s ability to
continue as a going concern after auditing the company's financial
statements for the years ended Dec. 31, 2006, and 2005.  The
auditing firm pointed to the company's recurring losses from
operations and net capital deficiency.

                     About DOV Pharmaceutical

Based in Somerset, N.J., DOV Pharmaceutical Inc. (Other OTC:
DOVP.PK) -- http://www.dovpharm.com/ -- is a biopharmaceutical   
company focused on the discovery, acquisition and development of
novel drug candidates for central nervous system disorders.  The
company's product candidates address some of the largest
pharmaceutical markets in the world including depression, pain and
insomnia.


DUNE ENERGY: March 31 Balance Sheet Upside-Down by $19,501,874
--------------------------------------------------------------
Dune Energy Inc. listed total assets of $55,520,257, total
liabilities of $75,022,131, and total stockholders' deficit of
$19,501,874 at March 31, 2007.  The company also listed a negative
working capital with total current assets of $4,009,778 and total
current liabilities of $12,807,021 at March 31, 2007.  The
company's accumulated deficit at March 31, 2007, stood at
$66,747,376, as compared with $58,894,600 at Dec. 31, 2006.

The company's first quarter revenues increased from $1,300,820 in
2006 to $2,994,414 in 2007 based on increased oil volumes of 3,600
Bbls and increased gas volumes 299,000 Mcfs.  Although gas prices
decreased $1.38/Mcf during the comparable period, increased
volumes more than offset the drop in gas prices.

Dune's net loss increased from $1,990,106 in 2006 to $7,852,776 in
2007.  The major components contributing to this increase includes
loss on impairment of long-lived assets, interest expense and loss
on embedded derivative liability.

                   Embedded Derivative Liability

Dune entered into derivative contracts to provide a measure of
stability in the cash flows associated with the Company's oil and
gas production and to manage exposure to commodity prices. Dune's
mark-to-market balance at March 31, 2006, reflected a liability of
$163,036, yielding a gain of $27,517 for the quarter.  Dune's
mark-to-market balance at March 31, 2007, reflected a liability of
$1,433,652 yielding a loss of $1,209,366 for the quarter.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fd3

                 Credit Agreement with D.B. Zwirn

On April 13, 2007, the company amended and restated its Amended
and Restated Credit Agreement with D.B. Zwirn Special
Opportunities Fund, L.P., as administrative agent, and the lenders
and party of the agreement, dated as of Sept. 26, 2006.  Subject
to numerous conditions precedent and covenants, the Credit
Agreement provides for a credit commitment of up to $65 million.

On April 16, 2007, the Lenders purchased the loans outstanding
under the Original Amended Credit Agreement and advanced the
remainder of the Commitment to us under the Credit Agreement.
Funds the company borrowed under the Commitment were used to pay
the $15 million Earnest Money deposit to the Shareholder and fund
certain fees and expenses in connection with the Credit
Agreement and the proposed acquisition of the issued and
outstanding shares of common stock of Goldking Energy.

                        About Dune Energy

Headquartered in Houston, Texas, Dune Energy Inc. (Amex: DNE) --
http://www.duneenergy.com/-- is an independent exploration and  
development company, with operations focused along the
Louisiana/Texas Gulf Coast and the North Texas Fort Worth Basin
Barnett Shale.  Dune will continue to exploit its existing asset
base, seek accretive acquisitions, and enter into additional joint
venture drilling programs.

                          *     *     *

As reported in the Troubled Company Reporter on May 2, 2007,
Moody's Investors Service assigned first-time ratings to Dune
Energy Inc., including a Caa2 Corporate Family Rating, Caa2
Probability of Default Rating, and a Caa2 rating (LGD 4, 50%) on
its proposed $285 million of senior secured notes due 2012.

At the same time, Standard & Poor's Ratings Services assigned its
'B-' corporate credit rating to oil and gas exploration and
production company Dune Energy Inc.  In addition, S&P assigned a
'B-' rating and '3' recovery rating, indicating S&P's expectation
of meaningful (50%-80%) recovery of principal in the event of a
payment default, to the company's proposed $285 million senior
secured notes due 2012.


EAGLE BROADBAND: Gets $500,000 Initial Purchase Order from Sprint
-----------------------------------------------------------------
Eagle Broadband Inc.'s IT Services Division has been awarded an
initial $500,000 purchase order from Sprint Nextel.

The company has been assigned the role as a Sprint Nextel vendor
to a very large extended wiring, equipment, and infrastructure
project for a U.S. Government agency security project at airport
terminals.  Eagle's initial phase rollout of infrastructure
network cabling and equipment installation will be delivered at 29
airports in the continental United States and U.S. territories.

"This is our first purchase order for this important project that
Sprint has defined as being a multimillion dollar program.  It
represents another milestone in our long-standing partnership with
Sprint Nextel.  The Eagle IT Services Division has been
successfully working with the Sprint Government Services Division
for a number of years and we welcome this next step opportunity to
broaden our services into new areas with Sprint Nextel's many U.S.
Government Agency customers," said Tony Cordaro, Vice President,
IT Services Division.  "This high-profile security project at
airport terminals and facilities will be implemented starting
immediately and will be coordinated by Eagle's National Project
Management team."

The project will include site surveys, developing infrastructure
inventories and establishing integrated system backbone and
infrastructure cabling, implementations of equipment, and overall
project management of the installations.

                       About Sprint Nextel

Sprint Nextel -- http://www.sprint.com/-- offers a comprehensive  
range of wireless and wireline communications services bringing
the freedom of mobility to consumers, businesses and government
users. Sprint Nextel is widely recognized for developing,
engineering and deploying innovative technologies, including two
robust wireless networks serving 53.1 million customers at the end
of 2006; industry-leading mobile data services; instant national
and international walkie-talkie capabilities; and an award-winning
and global Tier 1 Internet backbone.

                      About Eagle Broadband

Eagle Broadband Inc. (OTC BB: EAGB) -- http://eaglebroadband.com/
-- is a technology company that develops and delivers products and
services in three core business segments: IPTV -- Eagle
Broadband's IPTVComplete(TM) provides direct access to more than
250 channels of high-demand programming from popular entertainment
providers, often using Eagle's high-definition, set-top boxes.

SatMAX(R) -- Eagle Broadband's SatMAX provides indoor/outdoor
communications utilizing the global Iridium-based satellite
communications system.  It offers both fixed and mobile solutions,
including the emergency first responder SatMAX Alpha "SatMAX-in-a-
suitcase" technology.

IT Services - Eagle Broadband's IT Services Group is a full-
service integrator offering a complete range of network technology
products including VoIP, remote network management, network
implementation services and IT project management services.

At Feb. 28, 2007, the company's balance sheet showed $19.1 million
in total assets and $19.3 million in total liabilities, resulting
in a $134,000 total stockholders' deficit.

                       Going Concern Doubt

As reported in the Troubled Company Reporter on Dec. 27, 2006,
LBB & Associates Ltd. LLP in Houston, Texas, expressed substantial
doubt about Eagle Broadband Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
fiscal years ended Aug. 31, 2006, and 2005.  The auditing firm
pointed to the company's negative working capital, losses in 2005
and 2006, and need for additional financing necessary to support
its working capital requirements.


ENESCO GROUP: Wants to Hire Baker & McKenzie as Tax Counsel
-----------------------------------------------------------
Enesco Group Inc. and two debtor-affiliates ask the United States
Bankruptcy Court for the Northern District of Illinois for
authority to employ Baker & McKenzie as their special tax counsel
in connection with their Hong Kong tax appeals, effective as of
March 16, 2007.

The firm is expected to:

     (a) give the Debtors legal advice with respect to their
         rights, powers and duties in connection with the Tax
         Appeal and litigation related to the Tax Appeal
         proceedings;

     (b) prepare applications, motions compliants, orders and
         other legal documents as may be necessary in connection
         with the appropriate administration of the Tax Appeal;

     (c) participate on behalf of the Debtors in matters before
         the Inland Revenue Board of Review and the courts in Hong
         Kong relating to the Tax Appeal; and

     (d) perform any and all other legal services on behalf of the
         Debtors, which may be required to aid in the proper
         administration of the pending Tax Appeal proceedings.

The Debtors have agreed to pay Baker with a $25,000 retainer and
to compensate Baker according to the firm's standard rates for tax
appeals of the size and complexity as the Tax Appeal.  As of
May 4, 2007, Baker's hourly rates ranged from $620 to $840 for
partners and $260 to $645 for associates.  Baker's rates are
reviewed annually and adjusted periodically.

The Debtors assure the Court that Baker does not hold or represent
any adverse interest in connection to the Debtors and the estates.

                        About Enesco Group

Headquartered in Itasca, Illinois, Enesco Group, Inc. ---
http://www.enesco.com/-- produces giftware, and home and garden  
decor products.  Enesco's product lines include some of the
world's most recognizable brands, including Disney, Heartwood
Creek, Nickelodeon, Cherished Teddies, Lilliput Lane, Border Fine
Arts, among others.

Enesco distributes products to a wide array of specialty gift
retailers, home decor boutiques and direct mail retailers, as well
as mass-market chains.  The company serves markets operating in
Europe, Australia, Mexico, Asia and the Pacific Rim.  With
subsidiaries in Europe, Canada and a business unit in Hong Kong,
Enesco's international distribution network leads the industry.

Enesco Group and its two affiliates, Enesco International Ltd. and
Gregg Manufacturing Inc., filed for chapter 11 protection on
Jan. 12, 2007 (Bankr. N.D. Ill. Lead Case No. 07-00565).  Shaw
Gussis Fishman Glantz Wolfson & Tow and Skadden, Arps, Slate,
Meagher & Flom LLP represent the Debtors.  Adelman & Gettleman
Ltd. and Greenberg Traurig LLP represent the Official Committee of
Unsecured Creditors.  In its schedules filed with the Court,
Enesco Group disclosed total assets of $61,879,068 and total
liabilities of $231,510,180.


FASTENTECH INC: Closes $492 Million Merger Deal with Doncasters
---------------------------------------------------------------
Doncasters Group Ltd. has completed its acquisition of North
American based manufacturer of fasteners and precision components,
FastenTech Inc. from Citigroup Venture Capital for approximately
$492 million.

Fastentech says that the combined business now has a leading
worldwide position in the turbine "hot zone", giving Doncasters
end-to-end expertise in turbines.  The scale of the new combined
business means it will be better placed to capitalise on future
acquisitions and market opportunities.

Eric J. Lewis, CEO of the Doncasters Group explained, "Our
strategy is to expand our North American presence and the
acquisition of FastenTech, Inc. is crucial to this.  We are
delighted to have so smoothly secured regulatory approvals - it is
great news for us as well as our customers.

"We can now focus on turning the potential benefits of the
acquisition into reality.  There are strong opportunities in our
chosen markets and we plan to integrate the complementary
strengths of the two businesses to support growth in market share.
This is likely to mean further investment - prior to the
acquisition we were already planning US$150 million of capital
expenditure."

                      About Doncasters Group

The Doncasters Group -- http://www.doncasters.com/-- is an  
international manufacturer of performance and tolerance critical
engineering components for a variety of end market applications.
Doncasters excels in working with alloys and metals that are
difficult to shape and form.  The company's range of products and
processes has been developed to offer customers a broad,
vertically integrated capability.  Core manufacturing processes
include precision casting, forging, fabrication, machining and
production of superalloys.

                       About Fastentech Inc.

Based in Minneapolis, Minnesota, FastenTech, Inc., --
http://www.fastentech.com/-- is a privately held manufacturer of
specialty fasteners and fastener systems in the U.S.  It
manufactures and markets engineered components that support
applications in various end-markets, including the power
generation, industrial, military, construction, medium- heavy duty
truck, recreational and automotive/light truck markets.

                          *     *     *

As reported in the Troubled Company Reporter on March 5, 2007,
Moody's Investors Service placed the ratings of FastenTech, Inc.
under review with direction uncertain following the company's
report that it is being acquired by Doncasters Group Ltd., a UK-
based engineering group for $492 million.

After the acquisition, S&P and Moody's withdrew its ratings on
Fastentech.


FEDERAL-MOGUL: Seeks Summary Judgment vs. Pepsi's Amended Claim
---------------------------------------------------------------
Federal-Mogul Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to grant
summary judgment in their favor and disallow PepsiAmericas Inc.'s  
Amended Claim, pursuant to Rule 56 of the Federal Rules of Civil
Procedure, Rule 7056 of the Federal Rules of Bankruptcy Procedure,
and Section 502(b) of the Bankruptcy Code

                          Amended Claim

The Hon. Judith Fitzgerald had permitted PepsiAmericas to amend
Claim Nos. 6093 and 6441 and rules that the Amended Claim will be
deemed as PepsiAmericas' proof of claim in the Debtors' bankruptcy
cases.

Under its Amended Claim, PepsiAmericas seeks to recover:

   -- a portion of the expenses it allegedly incurred, and
      continues to incur, for prosecution of insurance coverage
      litigation and negotiations with insurers relating to
      asbestos-related claims against Abex Corporation and Pneumo
      Abex Corporation;

   -- damages resulting from Federal-Mogul Products, Inc.'s
      alleged mismanagement of the assumed liabilities under the
      Debtor's 1994 Asset Purchase Agreement with Pneumo Abex,
      and alleged over-allocation of defense and indemnity costs
      to those liabilities; and

   -- damages resulting from "unreasonable positions" allegedly
      taken by FMP in dealing with various insurers and
      PepsiAmericas.

                          Debtors' Plea

The Debtors maintain that there are no disputed material facts
relevant to the determination of whether PepsiAmericas has any
cognizable legal or equitable basis for its claims.

Scotta M. McFarland, Esq., at Pachulski Stang Ziehl Young & Jones
LLP, in Wilmington, Delaware, contends that contrary to
PepsiAmericas' assertions:

   -- PepsiAmericas is not a third-party beneficiary to the APA;

   -- FMP does not owe PepsiAmericas any obligations in
      connection with the APA; and

   -- PepsiAmericas cannot assert Pneumo Abex's claims against
      FMP as subrogee.

There are no facts, and PepsiAmericas has not alleged any facts,
that would suggest that the APA was designed to confer a benefit
on any entity other than FMP and Pneumo Abex, Ms. McFarland
points out.

FMP is not, and has never claimed to be, insured under, or in any
other way a party to, any of the Abex Policies, Ms. McFarland
points out.  FMP is not an intended third party beneficiary of
the Abex Policies.  Accordingly, FMP does not and cannot have any
obligations arising under the Abex Policies, Ms. McFarland
argues.

FMP merely bargained for and received the promise that Pneumo
Abex would turn over certain of the proceeds that it collected
from the Abex Policies pursuant to the APA, Ms. McFarland
clarifies.  Even if FMP were classified as a third-party
beneficiary of the Abex Policies, it cannot be liable for any
obligations under those policies because third-party
beneficiaries cannot incur liabilities under the contracts from
which they receive third-party benefits.

Ms. McFarland notes that Pneumo Abex has filed claims against the
Debtors and in 2004, settled a portion of those claims and
subsequently released the related rights to which PepsiAmericas
seeks to subrogate.

PepsiAmericas is not entitled to an equitable remedy, Ms.
McFarland contends.  The APA did not involve PepsiAmericas nor
did it impair in any way PepsiAmericas' rights against Pneumo
Abex.  Thus, it would be inequitable to allow PepsiAmericas to
benefit from that transaction at FMP's expense, Ms. McFarland
argues.

The APA makes FMP responsible only for those litigation expenses
not otherwise paid for by PepsiAmericas because there would be
significant future litigation that FMP would manage and for which
expenses FMP would be solely responsible, Ms. McFarland explains.  
In the event PepsiAmericas believes it is entitled to
reimbursement for a portion of litigation expenses, PepsiAmericas
should pursue relief from Pneumo Abex under the parties'
contracts.

                       Underwriters Respond

Certain Underwriters at Lloyd's London, and certain London Market
Companies relate that as with the Debtors' Objection to
PepsiAmericas, Inc.'s Claim Nos. 6093 and 6441, they are not
taking any positions with respect to the Debtors' Objection to
PepsiAmericas' Amended Claim.

The Underwriters reiterate their request that the Court refrain
from making any factual or legal findings regarding the alleged
transfer of insurance coverage to Pneumo Abex LLC, Wagner
Electric Corporation, Cooper Industries, LLC, PepsiAmericas Inc.,
or the Debtors, or the existence, non-existence, or scope of
insurance coverage available for asbestos personal injury claims.

                       About Federal-Mogul

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion.  Federal-Mogul also has
operations in Mexico and the Asia Pacific Region, which includes,
Malaysia, Australia, China, India, Japan, Korea, and Thailand.

The Company filed for chapter 11 protection on Oct. 1, 2001
(Bankr. Del. Case No. 01-10582).  Lawrence J. Nyhan Esq., James F.
Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown &
Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub, P.C., represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed $10.15 billion in assets and
$8.86 billion in liabilities.  Federal-Mogul Corp.'s U.K.
affiliate, Turner & Newall, is based at Dudley Hill, Bradford.
Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and
Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M.
Sutty, Esq., at The Bayard Firm represent the Official Committee
of Unsecured Creditors.

On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan.
They submitted a Disclosure Statement explaining that plan on
April 21, 2003.  They submitted several amendments and on June 6,
2004, the Bankruptcy Court approved the Third Amended Disclosure
Statement for their Third Amended Plan.  On July 28, 2004, the
District Court approved the Disclosure Statement.  The estimation
hearing began on June 14, 2005.  They then submitted a Fourth
Amended Plan and Disclosure Statement on Nov. 21, 2006, and the
Bankruptcy Court approved that Disclosure Statement on Feb. 6,
2007.  The confirmation hearing is set for June 8, 2007.
(Federal-Mogul Bankruptcy News, Issue No. 137; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


FEDERAL-MOGUL: PepsiAmericas Contests Summary Judgment Motion
-------------------------------------------------------------
Kirk T. Hartley, Esq., at Butler Rubin Saltarelli & Boyd LLP, in
Chicago, Illinois, argues that Federal-Mogul Corp. and its debtor-
affiliates' request for a summary judgment in their favor
regarding PepsiAmericas Inc.'s Amended Claim should be denied
because:

   -- the Debtors did not pay for and are not insured under the
      policies owned by PepsiAmericas; and

   -- PepsiAmericas' rights are not defined solely by three
      merger and acquisition contracts, but are also defined by
      its common law rights.

The Debtors' argument defies common sense, economic logic, and
the common law, Mr. Hartley contends.  The Debtors can no longer
enforce the three M&A Contracts because they have materially
breached the Contracts, Mr. Hartley asserts.

By arguing that equitable remedies are not available to
PepsiAmericas when enforceable contracts are in place between the
parties, the Debtors wrongly ignore their argument that there are
no contracts that obligate Federal-Mogul Products, Inc., to
PepsiAmericas, Mr. Hartley points out.

The Debtors, Mr. Hartley notes, do not controvert PepsiAmericas'
allegations that F-M Products:

   -- over-allocated expenses for asbestos claims arising from
      Abex Corporation to the PepsiAmericas Policies;

   -- refused to pay a fair share of insurance coverage expenses;
      and

   -- took unreasonable positions and was not candid with
      PepsiAmericas regarding matter related to insurance.

F-M Products is not only an assignee of insurance proceeds, but
also managed thousands of Abex Corp. asbestos claims, billed
insurers, and threatened insurers that they could not settle
insurance claims without F-M Products' agreement, Mr. Hartley
relates.

F-M Products, as an agent for Pneumo Abex Corporation, is bound
by the same contract restrictions that bind Pneumo Abex,
Mr. Hartley maintains.

Contrary to the Debtors' assertion, there have been multiple
insurance settlement contracts that have as parties an insurer,
PepsiAmericas, and F-M Products, Mr. Hartley argues.

In support of its contentions, PepsiAmericas proposes to submit
three confidential contracts for the U.S. Bankruptcy Court for the
District of Delaware to review:

   (1) Redacted version of a May 2000 confidential settlement
       agreement between Pneumo Abex Corp. and Whitman
       Corporation;

   (2) a December 2006 confidential settlement agreement and
       release among Pneumo Abex LLC, as successor by merger to
       Pneumo Abex Corp., Cooper Industries, LLC, PepsiAmericas,
       F-M Products, Federal-Mogul Corporation, and certain
       underwriters at Lloyd's; and

   (3) a December 2002 final settlement agreement between Pneumo
       Abex Corp. and Maryland Casualty Company.

PepsiAmericas seeks the Court's permission to file the
Confidential Contracts under seal.

The Confidential Contracts contain confidentiality provisions and
sensitive information, Mr. Hartley relates.  Thus, PepsiAmericas
and others will be prejudiced if the terms of the Contracts are
disclosed.

In the interests of judicial economy, PepsiAmericas asks the
Court to consider its Motion to Seal on June 7, 2007, the date on
which the Court is scheduled to hear the Debtors' Summary
Judgment Motion.

                       About Federal-Mogul

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion.  Federal-Mogul also has
operations in Mexico and the Asia Pacific Region, which includes,
Malaysia, Australia, China, India, Japan, Korea, and Thailand.

The Company filed for chapter 11 protection on Oct. 1, 2001
(Bankr. Del. Case No. 01-10582).  Lawrence J. Nyhan Esq., James F.
Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown &
Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub, P.C., represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed $10.15 billion in assets and
$8.86 billion in liabilities.  Federal-Mogul Corp.'s U.K.
affiliate, Turner & Newall, is based at Dudley Hill, Bradford.
Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and
Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M.
Sutty, Esq., at The Bayard Firm represent the Official Committee
of Unsecured Creditors.

On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan.
They submitted a Disclosure Statement explaining that plan on
April 21, 2003.  They submitted several amendments and on June 6,
2004, the Bankruptcy Court approved the Third Amended Disclosure
Statement for their Third Amended Plan.  On July 28, 2004, the
District Court approved the Disclosure Statement.  The estimation
hearing began on June 14, 2005.  They then submitted a Fourth
Amended Plan and Disclosure Statement on Nov. 21, 2006, and the
Bankruptcy Court approved that Disclosure Statement on Feb. 6,
2007.  The confirmation hearing is set for June 8, 2007.
(Federal-Mogul Bankruptcy News, Issue No. 137; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


FLYI INC: Distribution Trust Wants Five Cases Closed
----------------------------------------------------
The FLYi and Independence Air Distribution Trust ask the U.S.
Bankruptcy Court for the District of Delaware to enter a final
decree closing the Chapter 11 cases of five debtors-affiliates:

     Debtor                              Case No.
     ------                              --------
     Atlantic Coast Jet, LLC             05-20013
     Atlantic Coast Academy, Inc.        05-20014
     IA Sub, Inc.                        05-20015
     WaKeeney, Inc.                      05-20016
     Atlantic Coast Airlines, Inc.       05-20017

Section 350 of the Bankruptcy Code provides, in pertinent part
that "[a]fter an estate is fully administered . . . the court
shall close the case."  

The term "fully administered" is not defined by the Bankruptcy
Code or in the Federal Rules of Bankruptcy Procedure, M. Blake
Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware, relates.  In In re Mold Makers, 124 B.R.
766,768 (Bankr. N.D. Ill 1990), the court held that "at one
extreme, an estate could be fully administered when a Chapter 11
plan is confirmed and the estate dissolves. . . [and at] the
other extreme, an estate could be fully administered when all
that is called for under a plan occurs," Mr. Cleary says.

Mr. Cleary reminds the Court that the Advisory Committee Note
enumerates factors that a court should consider when determining
if an estate has been fully administered:

   (a) whether the order confirming the plan has become final;

   (b) whether deposits required by the plan have been
       distributed;

   (c) whether the property proposed by the plan to be
       transferred has been transferred;

   (d) whether the debtor or the successor to the debtor has
       assumed the business or management of the property dealt
       with by the plan;

   (e) whether payments under the plan have commenced; and

   (f) whether all motions, contested matters, and adversary
       proceedings have been resolved.

According to Mr. Cleary, each of the factors has been satisfied
because:

   (a) the order confirming the Debtors' First Amended Joint Plan
       of Liquidation became a final and non-appealable order on
       March 25, 2007;

   (b) the five Debtors have been substantively consolidated into
       Independence Air, Inc.;

   (c) segregated bank accounts have been established and
       deposits required under the Plan have been funded;

   (d) all of the property under the Plan has been transferred
       from the Debtors to the Trust;

   (e) the Trust has succeeded to the Debtors and assumed
       responsibility for the remaining assets; and

   (f) the Trust anticipates commencing distributions under the
       Plan by the end of May.

There are no outstanding motions, contested matters, or adversary
proceedings pending in or that relate to the five Debtors' cases,
Mr. Cleary says.

Mr. Cleary further notes that the Plan has been substantially
consummated within the meaning of Section 1101(2) of the
Bankruptcy Code.  The Plan became effective March 30, 2007.

The Confirmation Order provided that:

   -- all assets and liabilities of the Consolidated Debtors will
      be deemed merged;

   -- all guarantees by, or co-obligations of, any Consolidated
      Debtor in respect of the obligations of any other
      Consolidated Debtor will be deemed eliminated so that any
      Claim against any Consolidated Debtor and any guarantee by,
      or co-obligation of, any Consolidated Debtor and any joint
      or several liability of any Consolidated Debtor will be
      deemed to be one obligation of the consolidated Estates;
      and

   -- every Claim against any Consolidated Debtor will be deemed
      filed against the consolidated Estates and will be deemed
      one Claim against and a single obligation of the
      consolidated Estates.

In connection with closing of the five Debtors' cases, the Trust
will pay any unpaid fees due to the Office of the United States
Trustee that are required by applicable law for the cases.

Headquartered in Dulles, Virginia, FLYi Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport.  The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017).  Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.  Brett H. Miller, Esq., at Otterbourg,
Steindler, Houston & Rosen, P.C., represents the Official
Committee of Unsecured Creditors.  As of Sept. 30, 2005, the
Debtors listed assets totaling $378,500,000 and debts totaling
$455,400,000.

On Aug. 15, 2006, the Debtors filed their Joint Plan of
Liquidation.  On Nov. 13, 2006, they filed an Amended Plan and
Disclosure Statement.  The Court approved the adequacy of the
Amended Disclosure Statement on Nov. 17, 2006.  On March 15, 2007,
the Court confirmed the Debtors' Amended Plan.  The Debtors'
Amended Liquidation Plan became effective on March 30, 2007. (FLYi
Bankruptcy News, Issue No. 40; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


FOAMEX INTERNATIONAL: Posts $272 Mil. Equity Deficit at March 31
----------------------------------------------------------------
Foamex International Inc. recorded total assets of $578.6 million
and total liabilities of $850.6 million, resulting in a total
stockholders' deficit of $272 million as of March 31, 2007.

Net loss for the first quarter of 2007 was $17 million, as
compared with a net income of $17.1 million in the first quarter
of 2006.

Net sales for the first quarter were $317.2 million, down 13% from
$365.9 million in the first quarter of 2006, primarily due to
lower volumes in the Foam Products and Carpet Cushion Products
segments.  Gross profit for the quarter was $38.5 million, down
from $61.1 million in the first quarter of 2006, primarily due to
the lower volumes and prices.  Income from operations was
$20.6 million for the 2007 first quarter, as compared with
$36.7 million in the first quarter of 2006.

First quarter 2006 results were unusually strong and benefited
from the supply and demand imbalances caused by Hurricanes Katrina
and Rita.  Results in the 2007 period reflect lower volumes in
Foam Products and Carpet Cushion Products, contraction of demand
in the flexible polyurethane foam industry as a whole, and a
write-down of $2.7 million to adjust the carrying value of scrap
foam inventory.  The decrease in gross profit in the 2007 period
was partially offset by lower selling, general and administrative
expenses which decreased by $2.4 million, or 12%, due principally
to lower employee-related costs and professional fees.  
Restructuring charges were $400,000 in the first quarter of 2007,
as compared with $4.8 million in the prior year quarter, related
to the closure of several facilities in the 2006 period.

                  Liquidity and Capital Resources

Cash and cash equivalents were $7.8 million at April 1, 2007,
compared to $6 million at Dec. 31 2006.  Working capital at
April 1, 2007, was $149.5 million and the current ratio was 1.86
to 1 compared to working capital at Dec. 31, 2006, of $24 million
and a current ratio of 1.08 to 1.  The current ratio improvement
was primarily due to the repayment of the DIP Revolving Credit
Facility and DIP Term Loan.

Total long-term debt and revolving credit borrowings at April 1,
2007, were $629.1 million, down $14.6 million from Dec. 31, 2006.  
As of April 1, 2007, there were $21 million of revolving credit
borrowings with $95.8 million available for borrowings and
$21.6 million of letters of credit outstanding.  Revolving credit
borrowings at April 1, 2007, reflect working capital requirements.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fc4

Commenting on the results, recently appointed chief executive
officer John G. Johnson, Jr., said, "Our first quarter results
reflect a continuation of the softness in demand for foam products
in the bedding, furniture and carpet underlay markets that the
Company began to experience in the fourth quarter of 2006.  Much
like others serving these markets, Foamex continues to experience
the residual effects of the downturn in the housing and home
furnishings markets.  This industry has limited ability to
stimulate consumer demand for the home furnishings that
incorporate traditional foam product offerings.  Therefore, we
continue to focus on product innovation across the broader market
for polyurethane foam applications, while we simultaneously
extract cost from our operations, and aggressively address all
facets of cash generation to return value to our stockholders by
deleveraging the company."

Mr. Johnson continued, "On the cost savings front we are making a
significant investment in new operating equipment in our Tupelo,
Mississippi facility which will facilitate the consolidation of
two facilities in that region into one.  This consolidation will
have no effect on capacity, but will improve operating
efficiencies and generate significant overhead savings.  We have
also recently completed the consolidation of our Cookeville,
Tennessee fabrication facility into our nearby Morristown,
Tennessee facility.  These two examples are the first integration
steps in an overall plan to reduce costs and improve efficiency.
In addition, during the first quarter we completed the ramp up of
meaningful new lamination volume in our automotive sector.  In
April 2007, we made an optional prepayment on our first lien term
loan of $25 million.  Net debt at the end of the first quarter of
2007 was $621 million and revolving loan availability was
$96 million.  This is the lowest debt level we have had in
approximately ten years."

                    About Foamex International

Headquartered in Linwood, Pennsylvania, Foamex International Inc.
(FMXIQ.PK) -- http://www.foamex.com/-- produces cushioning for  
bedding, furniture, carpet cushion and automotive markets.  The
company also manufactures polymers for 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.  The Plan of Reorganization of
Foamex International Inc. has become effective and the company has
successfully emerged from chapter 11 bankruptcy protection on
Feb. 12, 2007.

                          *     *     *

As reported in the Troubled Company Reporter on April 16, 2007,
Foamex International Inc.'s balance sheet as of Dec. 31, 2006,
showed $396.4 million total stockholders' deficit, resulting from
$564.6 million total assets and $961 million total liabilities.  
The company's accumulated deficit as of Dec. 31, 2006, stood at
$432.7 million.

As reported in the Troubled Company Reporter on Feb. 16, 2007,
Standard & Poor's Ratings Services raised its corporate credit
rating on Linwood, Penn.-based Foamex L.P. to 'B' from 'D',
following the company's emergence from bankruptcy on Feb. 12,
2007.  S&P affirmed all other ratings.  The outlook is stable.


FORMICA CORP: Moody's May Downgrade Low-B Ratings After Review
--------------------------------------------------------------
Moody's Investors Service placed Formica Corporation on review for
possible downgrade.  The review was prompted by Fletcher Building
Limited planned acquisition of Formica from private equity firms
Cerberus Capital Management and Oaktree Capital Management for
approximately $700 million, with additional deferred payments of
up to $50 million if Formica achieves specific performance
targets.  The purchase price excludes Formica's South American
operations and certain real estate in California.

These ratings have been placed on review:

   -- Corporate family rating, rated B2;
   -- Probability of default rating, rated B2;
   -- $210 million gtd. sr. sec. term loan, rated B1; and
   -- $60 million gtd. sr. sec. revolving credit facility,
      rated B1.

The US$750 million total purchase price represents a multiple of
approximately 7.2 times June 2008 LTM EBITDA (with synergies). The
purchase is expected to initially be financed with bridge
financing, with a long-term capital structure to be put into place
after the close.  The transaction is anticipated to close in the
third quarter of 2007.

                        About Formica Corp.

Cincinnati, Ohio-based Formica Corp. -- http://www.formica.com/--  
designs, manufactures and distributes a full range of surfacing
products for commercial and residential applications, including
Formica(R) Brand Laminate, Formica(R) Solid Surfacing, Formica
Granite(R), Formica(R) Stone Natural Quartz Surfacing, Formica(R)
Veneer Premium Wood Surfacing and Formica(R) DecoMetal.  The
company has offices in Mexico, Spain, Sweden, United Kingdom,
Finland, France, Italy, Russia, China, Hong Kong, Singapore,
Taiwan, and Thailand.


GENERAL MOTORS: Mulls $1.1BB Unsec. Notes Offer to Boost Liquidity
------------------------------------------------------------------
General Motors Corporation plans to offer approximately
$1.1 billion in convertible debt securities.  The notes will be
unsecured and will mature on June 1, 2009.  GM intends to grant
the underwriters of the securities a 13-day option to purchase up
to an additional $165 million in principal amount of the
securities.  

The purpose of the offering is to replace $1.1 billion in
convertible securities put to the company in March of this year
and to bolster liquidity at a time when the capital markets
present an attractive opportunity to do so.

The joint-book running managers for the offering are Citi,
Deutsche Bank Securities and Goldman, Sachs & Co.  

In connection with the offering, GM expects to enter into capped
call transactions with affiliates of the underwriters of the
securities.  The capped call transactions are intended to
substantially increase the effective conversion premium of the
securities and reduce potential dilution to GM common stock upon
potential future conversion.

The counterparties to the capped call transactions have advised GM
that they expect to enter into various derivative and other
hedging activity with respect to GM's common stock, which could
have the effect of increasing, or preventing or offsetting a
decline in, the price of GM's common stock concurrently with or
following the pricing of the convertible debt securities.

                    Revolving Credit Commitment

GM has received commitment for a supplemental revolving credit
facility in an aggregate amount of approximately $4.1 billion.  
The company anticipates that the facility will be secured by GM's
common equity ownership of GMAC LLC and will mature 364 days after
the definitive agreement is signed.  The credit line could be
drawn upon for general corporate purposes including working
capital needs.

                    About General Motors Corp.

General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- is the    
world's largest automaker and has been the global industry sales
leader for 76 years.  GM currently employs about 280,000 people
around the world.  GM manufactures its cars and trucks in 33
countries.  In 2006, nearly 9.1 million GM cars and trucks were
sold globally under these brands: Buick, Cadillac, Chevrolet, GMC,
GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and
Vauxhall.

As of March 31, 2007, GM's balance sheet showed a stockholders'
deficit of $4,347,000,000, compared to a positive equity of
$15,779,000,000 at March 31, 2006.


GENERAL MOTORS: Debt Issuance News Cues Fitch to Cut Debt Rating
----------------------------------------------------------------
Fitch Ratings has downgraded General Motors Corporation's senior
unsecured debt rating to 'B-/RR5' from 'B/RR4'.  GM's Issuer
Default Rating remains at 'B' and is still on Rating Watch
Negative (along with the other outstanding ratings) by Fitch
following the company's announcement that it will be raising
US$4.1 billion in secured financing and US$1.1 billion in senior
unsecured convertible securities.  The US$4.1 billion 364-day
facility, to be secured by GM's common equity holdings in GMAC,
will be assigned a rating of 'BB/RR1', while the senior unsecured
convertible securities will be rated 'B-/RR5'.

The downgrade of GM's senior unsecured rating reflects the
increase in potential debt levels resulting from the new
financing, which could further impair unsecured recoveries in the
event of any eventual bankruptcy filing.  The ratings remain on
Rating Watch Negative pending the resolution of the Delphi
situation and the associated risks to production at GM.  Despite
absorbing significant liabilities to resolve the Delphi situation,
core wage and benefit issues have yet to be resolved.

The downgrade reflects the increase in debt levels and the
resulting reduced recovery expectations for senior unsecured debt
holders.  In Fitch's previous press release (dated Nov. 13, 2006)
Fitch stated that senior unsecured recoveries were expected to be
on the lower end of the 'RR4' range (30-50% recovery expectations)
and that any further changes to the liability structure could
result in a downgrade of the senior unsecured rating.  Recovery
prospects are now on the upper end of the 'RR5' range,
corresponding to 10-30% recovery prospects (see Fitch's recovery
report dated Sept. 19, 2006).

The new debt will further boost liquidity and financial resources
during GM's restructuring period and the upcoming UAW talks.  
Although negative cash flows are expected to continue at least
through 2007, healthy liquidity provides ample flexibility to
continue on GM's restructuring efforts.  At March, 31 2007, GM had
US$24.7 billion in cash (plus US$14.6 billion in long-term VEBA
assets), which could be further supplemented by proceeds from the
sale of Allison Transmission.

GM remains in the early stages of its long-term restructuring
program. Although meaningful reductions have taken place in GM's
fixed cost structure through hourly buyout programs, reductions in
salaried headcount and changes to hourly and salaried health care
programs, cash flow is expected to remain negative in 2007.  A
reversal of negative cash flows will depend on a stabilization of
market shares, as well as further cash cost reduction efforts.  
The upcoming UAW contract will play a key role in determining GM's
ability to shape a competitive cost structure, with progress
expected across a range of issues.

The main near-term issue remains health care costs, and Fitch
believes that even significant progress on GM's health care
liabilities during the current talks will still leave GM with a
heavy cost disadvantage versus transplant manufacturers.  
Restoration of competitive margins will be unachievable without
creating a long-term solution to these liabilities, and creative
solutions will continue to be explored.  As the Delphi situation
shows, reaching an agreement with the UAW will represent a
significant challenge due to the steep progress that needs to be
made, with ratification presenting a further challenge.  The
pending sale of Chrysler to Cerberus also adds a new dimension to
the contract talks.

Over the longer term, the achievement of competitive margins will
also depend on GM's ability to realize significant efficiencies in
areas such as platform consolidation, design and engineering
efficiencies, capacity utilization, supplier costs and flexible
manufacturing.  Even in a best-case scenario, Fitch expects that
meaningful progress in these areas will still result in a
significant margin differential versus transplant manufacturers
through the end of the decade, producing the need for further
restructuring actions.

Despite strong new product introductions and progress on cost
reductions, first quarter results in North America demonstrated
limited progress toward sustainable profitability.  GM's new
offerings in the large SUV and pickup categories over the past
several quarters have solidified GM's market strength in these
categories.  However, Fitch expects that GM's revenues will come
under increasing pressure in the second half of 2007 due to the
completion of these rollouts, the weak housing market, high gas
prices, and potential cutbacks in pickup truck production.  These
factors could also be exacerbated by weaker economic conditions.  
Over the intermediate term, success in the company's restructuring
program will be dependent on stabilizing North American market
share and revenues, which will represent a significant challenge
through at least 2008.

General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the
world's largest automaker, has been the global industry sales
leader since 1931.  Founded in 1908, GM employs about 317,000
people around the world.  It has manufacturing operations in 32
countries.

General Motors has Asia-Pacific operations in India, China,
Indonesia, Japan, the Philippines, among others. I t has
locations in European countries including Belgium, Austria, and
France.  In Latin-America, the company maintains locations in
Argentina, Brazil, Chile, Colombia, Ecuador, Venezuela, Paraguay
and Uruguay.


GMAC COMMERCIAL: Fitch Affirms $26.7 Million Class H Rating at B+
-----------------------------------------------------------------
Fitch Ratings affirms GMAC Commercial Mortgage Securities, Inc.'s
mortgage pass-through certificates, series 1999-C1 as:

     -- $628.4 million class A-2 at 'AAA';
     -- Interest only class X at 'AAA';
     -- $66.7 million class B at 'AAA';
     -- $66.7 million class C at 'AAA';
     -- $86.7 million class D at 'AAA';
     -- $20 million class E at 'AAA';
     -- $83.4 million class F at 'A-';
     -- $13.3 million class G at 'BBB';
     -- $26.7 million class H at 'B+'.

The $20 million class J remains at 'B-/DR1'.  The $10.8 million
class K-1 is not rated by Fitch.  Class A-1 has been paid in full.

The rating affirmations are the result of paydown, amortization
and additional defeasance since Fitch's last rating action, offset
by increased loss expectations on the specially serviced loans.  
As of the May 2007 distribution date, the transaction's aggregate
principal balance has decreased 23.4%, to $1.02 billion from $1.33
billion at issuance.  In total, 61 loans (34%) have fully defeased
since issuance. Of the 61 loans, 22.7% of the second largest loan
(5.5%) has defeased.

Currently, six loans (2.9%) are in special servicing with
significant losses expected on the real estate owned asset.  The
largest loan (1.3%) is secured by four congregate care healthcare
facilities located in Texas.  The loan, which remains current, is
cross-defaulted with another specially serviced congregate care
facility located in San Antonio, Texas.  The San Antonio loan
(0.3%) is also current, but the facility is closed.  Both loans
are performing under a forbearance agreement.  Fitch does not
project losses on these loans at this time.

The second largest asset (0.8%) is an office property in Pontiac,
Mich., and has been real-estate owned since October 2005.  The
special servicer continues to market the asset for sale.  Fitch
expects significant losses upon liquidation of the asset as a
result of a significant drop in the value of the property.


GOLDEN NUGGET: S&P Cuts Ratings to B+ and Retains Negative Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on Las Vegas-based Golden Nugget Inc.
to 'B+' from 'BB-'.  In addition, the ratings for Golden Nugget
will remain on CreditWatch with negative implications, where they
were placed on March 16, 2007.
     
Concurrently, S&P assigned its loan and recovery ratings to Golden
Nugget's planned $425 million senior secured credit facilities.  
The first-lien credit facility is rated 'BB-' with a recovery
rating of '1', indicating the expectation for full (100%) recovery
of principal in the event of a payment default.  The second-lien
credit facility is rated 'B+' with a recovery rating of '3',
indicating the expectation for meaningful (50%-80%) recovery of
principal in the event of a payment default.  All bank loan
ratings are on CreditWatch with negative implications.  
      
"The ratings on Golden Nugget remain on CreditWatch with negative
implications because of the ability of noteholders to accelerate
payment as a result of parent Landry's Restaurants Inc.'s
financial reporting delay," said Standard & Poor's credit analyst
Guido DeAscanis III.  Golden Nugget is not a bankruptcy-remote
subsidiary, so the potential for acceleration at the parent level
has implications for this operating subsidiary.  "Once the company
is current with its filings and in good standing with its
debtholders, it is likely that the ratings will be removed from
CreditWatch and that the outlook will be stabilized."


HOLLINGER INC: Black Says Investor Complaints on Fees was "Idiocy"
------------------------------------------------------------------
Conrad Black says complaints by investors of Hollinger
International Inc. that he, along with other executives, wrongly
received around $60 million in fees was an "epidemic of
shareholder idiocy," Bloomberg reports.

According to the report, the statement, which was made by Mr.
Black to former investor relations chief Paul Healy, prior to the
company's 2002 shareholders' meeting, was presented as evidence in
the Chicago federal court.  The prosecutor hopes that the evidence
will bolster claims that Mr. Black stole money from Hollinger.

Mr. Black also call the complaining investors as "Laura [Jereski]
and her overwrought friends," Bloomberg relates.

According to Globe and Mail, Mr. Jereski, an analyst at Tweedy
Browne Co., had told Mr. Healy that she planned to raise some
questions during Hollinger's 2002 meeting.  Tweedy Browne was one
of Hollingers largest shareholders.

                       Condrad Black Trial

As reported in the Troubled Company Reporter on March 21, 2007,
the trial is currently conducted at the U.S. District Court for
the Northern District of Illinois (U.S. v. Black, 05cr727).  

Mr. Black pleaded not guilty to 17 counts of fraud, money-
laundering, tax evasion, obstruction of justice and racketeering.  
Mr. Black, if found guilty, could face up to 101 years in jail,
$164 million in fines, and $92 million in possible forfeitures.

His co-accused are: former Hollinger Chief Financial Officer Jack
Boultbee, 63, of Vancouver; former Hollinger General Counsel Peter
Y. Atkinson, 59, of Toronto; and former Hollinger Corporate
Secretary Mark Kipnis, 60.

                               Odds

BetUS.com had said that the odds of Mr. Black being found guilty
on all charges was 2/1 with not guilty at 10/1.  BetUS further
said that the odds of Mr. Black being divorced before Dec. 31,
2008 was 5/1.

                         Ravelston's Plea

As reported in the Troubled Company Reporter on March 12, 2007,
Ravelston Corp. had pleaded guilty in a Chicago federal court to
fraud and agreed to pay a $7 million fine in connection with the
diversion of funds from Hollinger Inc.  An indictment handed down
in 2005 charged that the Ravelston and four company officers,
including Mr. Black, diverted $84 million from Hollinger Inc.

Mr. Black had unsuccessfully fought in the Canadian courts to
block Ravelston from pleading guilty.

Ravelston is in receivership in Canada with RSM Richter Inc.
serving as its Receiver.

                        About Ravelston

Ravelston Corp. is a privately-held Canadian corporation and
beneficially owns approximately 78% of Hollinger, Inc.'s stock.
Ravelston is the controlling shareholder of Hollinger, Inc.
Ravelston is owned and controlled by Conrad Black and David
Radler.  Mr. Black, through the Conrad Black Capital Corporation,
indirectly owns 65.1% of Ravelston.  Mr. Radler, through F.D.
Radler, Limited, indirectly owns 14.2% of Ravelston.  Mr. Black is
the Chairman and CEO of Ravelston while Mr. Radler is the
President.

                       About Hollinger Inc.

Based in Toronto, Ontario, Hollinger Inc. (TSX: HLG.C)(TSX:
HLG.PR.B) -- http://www.hollingerinc.com/-- owns approximately     
70.1% voting and 19.7% equity interest in Sun-Times Media Group
Inc. (formerly Hollinger International Inc.), a newspaper
publisher with assets, which include the Chicago Sun-Times and a
large number of community newspapers in the Chicago area.
Hollinger also owns a portfolio of commercial real estate in
Canada.

                        Litigation Risks

Hollinger Inc. faces various court cases and investigations
including: (1) a consolidated class action complaint filed in
Chicago, Illinois; (2) a class action lawsuit that was filed in
the Saskatchewan Court of Queen's Bench on Sept. 7, 2004; (3) a
$425,000,000 fraud and damage suit filed in the State of Illinois
by International; (4) a lawsuit seeking enforcement of a Nov. 15,
2003, restructuring proposal to uphold a Shareholders' Rights
Plan, a declaration that corporate by-laws were invalid and to
prevent the closing of a certain transaction; (5) a lawsuit filed
by International seeking injunctive relief for the return of
documents of which it claims ownership; (6) a $5,000,000 damage
action commenced by a lessor of an aircraft lease, in which
Hollinger was the guarantor; (7) an action commenced by the United
States Securities and Exchange Commission on Nov. 15, 2004,
seeking injunctive, monetary and other equitable relief; and (8)
investigation by the enforcement division of the OSC.


HOLLISTON MILLS: Organizational Meeting Scheduled on May 30
-----------------------------------------------------------
Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, will hold
an organizational meeting to appoint an official committee of
unsecured creditors in The Holliston Mills, Inc.'s chapter 11 case
at 9:30 a.m., on May 30, 2007, at the J. Caleb Boggs Federal
Building, Room 2112, 844 North King Street, in Wilmington,
Delaware.

The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtor's cases.  The
meeting is not the meeting of creditors pursuant to Section 341
of the Bankruptcy Code.  However, a representative of the Debtor
will attend and provide background information regarding the
cases.

Creditors interested in serving on a Committee should complete
and return to the U.S. Trustee a statement indicating their
willingness to serve on an official committee.

Official creditors' committees, constituted under Section 1102 of
the Bankruptcy Code, ordinarily consist of the seven largest
creditors who are willing to serve on a committee.  In some
Chapter 11 cases, the U.S. Trustee is persuaded to appoint
multiple creditors' committees.

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense.  They may investigate the Debtor's business and
financial affairs.  Importantly, official committees serve as
fiduciaries to the general population of creditors they
represent.  Those committees will also attempt to negotiate the
terms of a consensual Chapter 11 plan -- almost always subject to
the terms of strict confidentiality agreements with the Debtors
and other core parties-in-interest.  If negotiations break down,
the Committee may ask the Bankruptcy Court to replace management
with an independent trustee.  If the Committee concludes that the
reorganization of the Debtors is impossible, the Committee will
urge the Bankruptcy Court to convert the Chapter 11 cases to a
liquidation proceeding.

Based in Church Hill, Tennessee, The Holliston Mills, Inc. --
http://www.icgholliston.com/-- produces fabrics for various  
coating applications.  The company filed for Chapter 11 protection
on May 21, 2007 (Bankr. D. Del. Case No. 07-10687).  Robert S.
Brady, Esq., at Young Conaway Stargatt & Taylor, represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it listed estimated assets and
debts of $1 million to $100 million.


INDEPENDENT BANK: Earns $6.6 Million in Quarter Ending March 31
---------------------------------------------------------------
Independent Bank Corporation reported that its first quarter 2007
net income was $6.6 million.  A year earlier, net income totaled
$7.9 million.  The company's net income for the quarterly periods
ended March 31, 2007 and 2006 was $4.7 million and $12.3 million,
respectively.

On Jan. 15, 2007, Mepco Finance Corporation, a wholly owned
subsidiary of IBC, sold substantially all of its assets related to
the insurance premium finance business to Premium Financing
Specialists, Inc.  Mepco continues to own and operate its warranty
payment plan business.  The assets, liabilities and operations of
Mepco's insurance premium finance business have been reclassified
as discontinued operations and all periods presented have been
restated for this reclassification.

On March 23, 2007 the company completed the acquisition of ten
branches (located in Battle Creek, Bay City and Saginaw, Michigan)
from TCF National Bank. This acquisition added $241.4 million in
deposits.

"Our lower first quarter 2007 earnings reflect the asset quality
challenges that we have encountered over the past few quarters as
well as the continuing impact of the difficult interest rate
environment (flat yield curve) and tough competitive and economic
conditions in our State," Michael M. Magee, President and CEO,
commented.  "Despite the current interest rate environment, our
first quarter 2007 net interest margin was unchanged from the
fourth quarter of 2006 and we expect that our recent branch
acquisition will lead to future improvements in our net interest
margin during the balance of 2007.  Based upon these developments,
we are optimistic that the adverse impact of the flat yield curve
on our net interest margin has subsided.  As a result of our
actual first quarter earnings and slower loan growth and higher
credit cost expectations than what were originally anticipated in
our previous earnings guidance, we are reducing our full year 2007
earnings estimate from a range of $1.70 to $1.82 per diluted share
to a range of $1.20 to $1.40 per diluted share."

Total assets were $3.36 billion at March 31, 2007, compared to
$3.43 billion at Dec. 31, 2006.  Loans, excluding loans held for
sale were $2.48 billion at both March 31, 2007 and Dec. 31, 2006.  
Deposits totaled $2.90 billion at March 31, 2007, an increase of
$300.7 million from Dec. 31, 2006.  The increase in deposits
primarily reflects the aforementioned acquisition of ten branches.  
Stockholders' equity totaled $252.2 million at March 31, 2007, or
7.52% of total assets, and represents a net book value per share
of $11.17.

"Our first quarter results were well below our expectations;
however, we believe that our net interest margin has stabilized
and that the changes enumerated above will lead to improved asset
quality, reduced credit costs, and greater operational
efficiencies in the future," Mr. Magee concluded.  "The bank
charter consolidation will allow us to further enhance our
customers' experience as the development and delivery of new
products and services will be streamlined.  The consolidation will
not impact our long heritage of community banking, and, consistent
with that heritage, we will continue to keep decisions close to
our customers."

                      About Independent Bank

Michigan-based, Independent Bank Corporation (Nasdaq: IBCP) --
http://www.ibcp.com/-- is a bank holding company with total  
assets of over $3 billion.  Founded as First National Bank of
Ionia in 1864, Independent Bank Corporation now operates over 100
offices across Michigan's Lower Peninsula through four state-
chartered bank subsidiaries.  These subsidiaries, Independent
Bank, Independent Bank East Michigan, Independent Bank South
Michigan and Independent Bank West Michigan, provide a full range
of financial services, including commercial banking, mortgage
lending, investments and title services.  The company also
provides payment plans to consumers to purchase vehicle service
contracts through Mepco Finance Corporation, a wholly owned
subsidiary of Independent Bank.  Independent Bank Corporation is
committed to providing exceptional personal service and value to
its customers, stockholders and the communities it serves.

                          *     *     *

Fitch Ratings assigned a B short-term issuer default rating to
Independent Bank Corp. on July 2002.


INFORMATION ARCHITECTS: Has $2,373,108 Equity Deficit at March 31
-----------------------------------------------------------------
Information Architects Corporation, at March 31, 2007, recorded
total stockholders' deficit of $2,373,108, from total assets of
$1,874,135 and total liabilities of $4,247,243.  

The company's March 31, 2007 balance sheet also showed strained
liquidity with total current assets of $25,875 and total current
liabilities of $4,247,243.  Ending cash and cash equivalents as of
March 31, 2007, were a positive $10,749.  The company had zero
cash in the prior year period.

For the three months ended March 31, 2007, the company had sales
of $6,791, as compared with sales of $150,083 for the three months
ended March 31, 2006.  Net losses from operations for the first
quarters 2007 and 2006 were $176,704 and $180,193, respectively.  
The company had a net loss for the first quarter 2007 of $210,724,
as compared with a net loss of $191,533 for the first quarter
2006.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fe7

Headquartered in Ft. Lauderdale, Florida, Information Architects
Corporation (PNK: IACH.PK) -- http://www.ia.com/-- provides  
employment screening and background investigations software
application.


INTRALINKS INC: Rapid Growth Cues S&P to Assign B Corp. Credit
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to New York City-based IntraLinks Inc., a provider
of online workspaces used to exchange and manage time-sensitive,
confidential information.  The outlook is stable.  At the same
time, S&P assigned its 'B' bank loan rating and '2' recovery
rating to the company's proposed $165 million of first-lien
secured debt facilities, consisting of a $15 million revolving
credit, a $100 million term loan B, and $50 million PIK toggle
term B.  S&P also assigned a `CCC+' bank loan rating and
'5' recovery rating to the company's proposed $50 million second-
lien term loan.  Proceeds will be used to fund the leveraged
acquisition of the company by TA Associates and RHO Capital
Partners.
      
"The ratings reflect the company's niche product position, rapid
growth, and high leverage at inception," said Standard & Poor's
credit analyst Philip Schrank.  Partial offsets include stable
profitability and cash flow trends, good revenue visibility, and
barriers to entry protecting the company's markets.
     
With 2006 revenue of $86 million, IntraLinks has averaged about a
50% growth rate over the past three years.  The company has a
significant installed base in its core financial services markets,
and is positioned in emerging corporate, life sciences and
international markets.  Penetration rates are low in a sizable
addressable market, and barriers to entry include first mover
advantage, brand loyalty, and domain expertise.  Still, the
company is vulnerable to larger and stronger financial competitors
entering the marketplace, as well as the risks associated with
managing its fast growth.


J.P. MORGAN: Fitch Affirms Four Low B Ratings on Four Classes
-------------------------------------------------------------
Fitch Ratings has affirmed all classes from these J.P. Morgan
Alternative Loan Mortgage Trusts:

  Series 2006-A1 Pool 1

     -- Class A affirmed at 'AAA';
     -- Class 1-M-1 affirmed at 'AA+';
     -- Class 1-M-2 affirmed at 'A+';
     -- Class 1-B-1 affirmed at 'BBB+';
     -- Class 1-B-2 affirmed at 'BBB'.

  Series 2006-A1 Pools 2-5

     -- Class A affirmed at 'AAA';
     -- Class C-B-1 affirmed at 'AA';
     -- Class C-B-2 affirmed at 'A';
     -- Class C-B-3 affirmed at 'BBB';

  Series 2006-A2 Pool 1

     -- Class A affirmed at 'AAA';
     -- Class 1-M-1 affirmed at 'AA+';
     -- Class 1-M-2 affirmed at 'A+';
     -- Class 1-B-1 affirmed at 'BBB+';
     -- Class 1-B-2 affirmed at 'BBB'.

  Series 2006-A2 Pools 2-5

     -- Class A affirmed at 'AAA';
     -- Class C-B-1 affirmed at 'AA';
     -- Class C-B-2 affirmed at 'A';
     -- Class C-B-3 affirmed at 'BBB';
     -- Class C-B-4 affirmed at 'BB';
     -- Class C-B-5 affirmed at 'B'.

  Series 2006-A3 Pool 1

     -- Class A affirmed at 'AAA';
     -- Class 1-M-1 affirmed at 'AA+';
     -- Class 1-M-2 affirmed at 'A+';
     -- Class 1-B-1 affirmed at 'BBB+';
     -- Class 1-B-2 affirmed at 'BBB'.

  Series 2006-A3 Pools 2-3

     -- Class A affirmed at 'AAA';
     -- Class C-B-1 affirmed at 'AA';
     -- Class C-B-2 affirmed at 'A';
     -- Class C-B-3 affirmed at 'BBB';
     -- Class C-B-4 affirmed at 'BB';
     -- Class C-B-5 affirmed at 'B'.

  Series 2006-S1 Pools 1-2

     -- Class A affirmed at 'AAA';
     -- Class B-1 affirmed at 'AA';
     -- Class B-2 affirmed at 'A';
     -- Class B-3 affirmed at 'BBB';
     -- Class B-4 affirmed at 'BB';
     -- Class B-5 affirmed at 'B'.

  Series 2006-S1 Pool 3

     -- Class A affirmed at 'AAA';
     -- Class 3-M-1 affirmed at 'AA+';
     -- Class 3-M-2 affirmed at 'A+';
     -- Class 3-B-1 affirmed at 'BBB+';
     -- Class 3-B-2 affirmed at 'BBB'.

The underlying collateral for the aforementioned transactions
consist primarily of fixed and adjustable-rate, conventional,
fully amortizing, first lien residential mortgage loans extended
to Alternative A borrowers.  The mortgage loans were either
originated or acquired by various originators.  J.P. Morgan
Acceptance Corporation I, a special purpose corporation, had
subsequently acquired the mortgage loans from the originators.

The affirmations reflect adequate relationships of credit
enhancement to future loss expectations and affect approximately
$2.84 billion of outstanding certificates.  As of the April 2007
remittance period, the trusts are seasoned 10 to 14 months and
have a pool factors (as a percentage of the original balance)
ranging from 68% to 87%.

All of the transactions are being serviced by various entities
with Wells Fargo Bank, N.A (rated 'RMS1' by Fitch) acting as
master servicer.


JOSE SANCHEZ-PENA: Organizational Meeting Scheduled for June 1
--------------------------------------------------------------
Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, will hold
an organizational meeting to appoint an official committee of
unsecured creditors in the Chapter 11 case of Jose R. Sanchez-
Pena, M.D. at 11:00 a.m., on June 1, 2007, at the U.S. Trustee's
Office, Room 1401, 14th Floor, in Newark, New Jersey.

The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtor's cases.  The
meeting is not the meeting of creditors pursuant to Section 341
of the Bankruptcy Code.  However, a representative of the Debtor
will attend and provide background information regarding the
cases.

Creditors interested in serving on a Committee should complete
and return to the U.S. Trustee a statement indicating their
willingness to serve on an official committee.

Official creditors' committees, constituted under Section 1102 of
the Bankruptcy Code, ordinarily consist of the seven largest
creditors who are willing to serve on a committee.  In some
Chapter 11 cases, the U.S. Trustee is persuaded to appoint
multiple creditors' committees.

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense.  They may investigate the Debtor's business and
financial affairs.  Importantly, official committees serve as
fiduciaries to the general population of creditors they
represent.  Those committees will also attempt to negotiate the
terms of a consensual Chapter 11 plan -- almost always subject to
the terms of strict confidentiality agreements with the Debtors
and other core parties-in-interest.  If negotiations break down,
the Committee may ask the Bankruptcy Court to replace management
with an independent trustee.  If the Committee concludes that the
reorganization of the Debtors is impossible, the Committee will
urge the Bankruptcy Court to convert the Chapter 11 cases to a
liquidation proceeding.

Jose R. Sanchez-Pena, M.D. filed for Chapter 11 protection on
April 12, 2007 (Bankr. D. N.J. Case No. 07-15054).  David
Edelberg, Esq., at Nowell Amoroso Klein Bierman, P.A., represents
Mr. Sanchez in his restructuring efforts.  When Mr. Sanchez filed
for protection from his creditors, he listed assets and debts of
$1 million to $100 million.


KB HOME: Agrees to Sell 49% Stake in Kaufman to PAI Partners
------------------------------------------------------------
KB Home has entered into a binding share purchase agreement to
sell its entire 49% equity interest representing 10,921,954 shares
in its French subsidiary Kaufman & Broad S.A. to PAI Partners at a
price of 55.00 euros per share.

The purchase price will consist of 50.17 euros per share in cash
to be paid by PAI to KB Home after payment of a cash dividend of
4.83 euros per share to be approved by the Board of Directors of
KBSA and to be paid by KBSA.

As reported in the Troubled Company Reporter on May 22, 2007, KB
Home previously announced on May 17, 2007 that it entered into an
exclusivity period with PAI based on a final, irrevocable, binding
and fully financed offer from PAI.  The transaction is expected to
close during KB Home's third fiscal quarter of 2007 and remains
subject to customary terms and conditions, including regulatory
approval.

                     About Kaufman & Broad S.A.

Kaufman & Broad S.A. -- http://www.uk.ketb.com/uk/france_home/--    
designs, builds and sells single-family homes and apartments, as
well as office properties on behalf of third parties.

                          About KB Home

Based in Los Angeles, California, KB Home (NYSE: KBH) --
http://www.ketb.com/-- is an American homebuilder.  The company    
has domestic operating divisions in 15 states, building
communities from coast to coast.

                          *     *     *

As reported in the Troubled Company Reporter on Apr. 16, 2007,
Moody's Investors Service confirmed the ratings of KB Home,
including its Ba1 corporate family rating, Ba1 ratings on the
company's senior notes, and Ba2 ratings on the company's
subordinated notes.  The ratings were taken off review for
downgrade, concluding the review that was commenced on
Dec. 15, 2006.  The ratings outlook is negative.


KIK CUSTOM: Moody's Affirms B2 Corporate Family Rating
------------------------------------------------------
Moody's Investors Service lowered the first-time ratings assigned
to KIK Custom Products Inc.'s first lien senior secured credit
facilities to B1 from Ba3, and affirmed the company's B2 corporate
family rating.

Moody's notes that while there has been no fundamental
deterioration in KIK's overall credit profile, the downgrade of
the first lien credit facilities to B1 reflects a recent change to
the company's capital structure that results in a higher
proportion of first lien debt and a smaller cushion of more junior
debt below it.  Moody's also notes that while the Caa1 rating on
KIK's $235 million second lien term loan did not change as a
result of the altered capital structure, the LGD point estimate
was revised to LGD5, 81% from LGD 5, 80%.

The ratings outlook remains stable.

Proceeds from the credit facilities combined with $160 million of
preferred and common equity will be used to fund Caxton-Iseman
Capital, Inc.'s proposed acquisition of the company for
approximately $725 million, which includes the redemption of
investors' interests in KCP Income Fund.  The transaction is
expected to close this month.  Proceeds from the financing will
also be used to refinance existing debt and to fund the
acquisition of certain manufacturing assets owned by Outsourcing
Services Group, LLC for $32.5 million.

KIK Custom Products Inc.

Ratings downgraded:

   -- $55 million senior secured revolving credit facility due
      2013, to B1 (LGD3, 32%) from Ba3 (LGD3, 32%);

   -- $410 million first lien senior secured term loan due 2014,
      to B1 (LGD3, 32%) from Ba3 (LGD3, 32%).

Ratings affirmed:

   -- Corporate family rating at B2;

   -- Probability-of-default rating at B2;

   -- $235 million second lien senior secured term loan due
      2014, at Caa1 (LGD5, 81%). Originally assessed at (LGD5,
      80%).

Headquartered in Ontario, Canada, KIK Custom Products Inc.
manufactures a variety of household cleaning, laundry, personal
care, over-the-counter and prescription drug product lines.  The
company reported sales of $1.1 billion for the twelve months ended
March 31, 2007.


KINGSLAND V: S&P Rates $14.9MM Class E Floating-Rate Notes at BB
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Kingsland V Ltd./Kingsland V Corp.'s
$448.9 million floating-rate notes due 2021.
     
The preliminary ratings are based on information as of May 23,
2007.  Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
     
The preliminary ratings reflect:

     -- The expected commensurate level of credit support in the
        form of subordination to be provided by the notes and
        subordinated notes junior to the respective classes;

     -- The availability of additional credit enhancement in the
        form of excess spread;

     -- The structural features that are intended to limit the
        impact of a portfolio deterioration on the noteholders;

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

     -- The collateral manager's experience in managing the asset
        type of the collateral pool; and

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

                   Preliminary Ratings Assigned
                Kingsland V Ltd./Kingsland V Corp.
   
            Class                   Rating        Amount
            -----                   ------        ------
             A-1                     AAA       $295,975,000
             A-2R                    AAA        $60,000,000
             A-2B                    AAA        $12,125,000
             B                       AA         $22,900,000
             C                       A          $25,000,000
             D-1                     BBB-       $13,000,000
             D-2                     BBB-        $5,000,000
             E                       BB         $14,900,000
             Subordinated notes      NR         $36,100,000
                

                           *NR - Not rated.


LANDRY'S RESTAURANTS: S&P Lowers Credit Rating to B+ from BB-
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered the ratings, including
the corporate credit rating, on the Houston, Texas-based Landry's
Restaurants Inc. to 'B+' from 'BB-'.  The ratings will remain on
CreditWatch with negative implications where they were placed on
March 16, 2007, because the company has not filed its 10-K for
fiscal 2006 or 10-Q for the first quarter of fiscal 2007.  As a
result, the company is in technical violation with its lenders,
who can force acceleration of redemption of principal and
interest.  The CreditWatch will be resolved once Landry's is
current with its filings and in good standing with its lenders.  
However, S&P may lower the ratings on Landry's if lenders do
accelerate.
     
At the same time Standard & Poor's cut the rating on Landry's
senior secured credit facility, consisting of its term loan and
revolving credit facility, to 'BB-' from 'BB'.  This is still one
notch above the corporate credit rating on the company.  The
recovery rating on the facility remains at '1', which indicates
the expectations for full (100%) recovery of principle in the
event of default.  The $400 million 7.5% senior unsecured notes
due Dec. 15, 2014, were also downgraded to 'B-' from 'B'.  The
bank loan ratings remain on CreditWatch with negative
implications.
      
"The downgrade reflects management's more aggressive financial
policy and willingness to fund acquisitions and capital
expenditures with debt," said Standard & Poor's credit analyst
Charles Pinson-Rose.  This is evidenced by the company's
attempted-though unsuccessful-purchase of Smith and Wollensky
Restaurant Group Inc. and the increased debt at its unrestricted
subsidiary Golden Nugget Inc.


LEASE INVESTMENT: Missed Interest Payment Cues S&P's 'D' Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class B-1 and B-2 floating-rate asset-backed notes from Lease
Investment Flight Trust's series 2001-1 to 'D' from 'CCC-'.
     
S&P lowered the ratings on the class B-1 and B-2 notes to 'D'
because of a missed interest payment due to the class B
noteholders on the most recent payment date.  The liquidity
reserve available to pay interest on the class B notes has been
depleted, and it is believed that it is unlikely that there
will be sufficient funds available to make scheduled interest
payments on the class B notes beyond the end of the third quarter
of 2007.
     
Standard & Poor's will continue to monitor the management of the
portfolio and the outstanding ratings on the class A notes from
this transaction.


                          Ratings Lowered
    
                   Lease Investment Flight Trust
          Floating-rate asset-backed notes series 2001-1

                                  Rating
                                  ------
                       Class    To      From
                       -----    --      ----
                        B-1     D       CCC-/Negative
                        B-2     D       CCC-/Negative


LEXINGTON RESOURCES: Whitley Penn Raises Going Concern Doubt
------------------------------------------------------------
Whitley Penn L.L.P., of Dallas, Texas, expressed substantial doubt
about Lexington Resources, Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended Dec. 31, 2006.  The auditing firm pointed to the
company's recurring losses from operations, net working capital
deficiency and accumulated deficit.

The company posted a net loss of $10,576,849 on revenues of
$2,336,941 for the year ended Dec. 31, 2006, as compared with a
net loss of $8,538,863 on revenues of $693,860 in the prior year.

For the year ended Dec. 31, 2006, the company's total operating
expenses increased to $11,946,340 from $4,457,684 in the prior
year.  General and administrative expenses grew to $2,520,652 for
the year ended Dec. 31, 2006, from $864,964 in the prior year.  
Depreciation, depletion and amortization also grew to $1,209,969
for the year ended Dec. 31, 2006, from $259,609 in the prior year.  
Operating costs and taxes increased to $474,696 for the year ended
Dec. 31, 2006, from $213,377 in the prior year.  The company has
increased expenses in investor relations and promotion with
$2,238,575 for the year ended Dec. 31, 2006, as compared with
$1,205,743 in the prior year.  For the year ended Dec. 31, 2006,
the company incurred $905,148 in rig, well and pulling unit
expenses; $847,300 in salaries, wages and related expenses;
$1,600,000 in impairment of other equipment; and $2,150,000 in
impairment of oil and gas properties.

At Dec. 31, 2006, the Company's balance sheet showed $18,432,644
in total assets, $12,697,947 in total liabilities and $5,734,697
in stockholders' equity.  The company's Dec. 31, 2006 balance
sheet also showed negative working capital with $1,628,327 in
total current assets and $9,863,157 in total current liabilities.

                     Liquidity & Capital Resources

For the year ended Dec. 31, 2006, the company's current assets
were $1,628,327 and current liabilities were $9,863,157, resulting
in a working capital deficit of $8,234,830.  At Dec. 31, 2006,
current assets were comprised of $86,241 in cash and cash
equivalents, $1,425,450 in accounts receivable, $73,916 in amounts
due from related parties, $39,803 in current portion of deferred
finance fees, and $2,917 in prepaid expenses.  At Dec. 31, 2006,
current liabilities were comprised of $8,404,178 in accounts
payable and accrued liabilities, $615,824 in current portion of
convertible notes and accrued interest, $640,274 in promissory
note and other short-term advances, and $202,881 in amounts due to
related parties.

For the year ended Dec. 31, 2006, the company's total assets were
$18,432,644 comprised of $1,628,327 in current assets, $2,767,225
in assets held for sale, $8,408,510 in carrying value of proved
oil and gas properties (net of accumulated depletion), $5,049,858
in carrying value of unproved oil and gas properties, and $578,724
in other fixed assets (net of accumulated depreciation).  The
increase in total assets during fiscal year ended Dec. 31, 2006
from fiscal year ended Dec. 31, 2005 was primarily due to the
increase in carrying value of proved and unproved oil and gas
properties from well drilling and leasehold related capital
expenditures.

A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1fbb

                       About Lexington Resources

Lexington Resources Inc. -- (OTCBB: LXRS) (FSE: LXR) (BER: LXR)
(WKN: AOBKLP) -- http://www.lexingtonresources.com/-- acquires   
and develops oil and natural gas properties in the United States.
The company owns a 590 gross acre section of farm-out acreage in
Pittsburg County, Oklahoma for the development and production of
coal bed methane gas known as the Wagnon Property.  The company is
producing gas from four wells drilled on the Wagnon Property.
Lexington has a 53.2% back-in working interest in each of the
wells.  Its current operational focus is gas development
initiatives in the Arkoma Basin, Oklahoma, and the Fort Worth
Basin, in Dallas, Texas.


LIFECARE HOLDINGS: Posts $1.7 Million Net Loss in First Qtr. 2007
-----------------------------------------------------------------
LifeCare Holdings Inc. incurred a net loss of $1.7 million for the
first quarter ended March 31, 2007, as compared with a net income
of $3.8 million for the first quarter ended March 31, 2006.  The
company had net patient service revenue for the three months ended
March 31, 2007, of $82.4 million, as compared with $87.3 million
for the comparable period in 2006.  

Patient days in 2007 were 424 greater, than the same period in
2006.  This decrease was comprised of a favorable benefit of
$600,000 from the increase in patient days offset by an
unfavorable variance of $5.6 million as the result of lower rates
on a per patient day basis.

At March 31, 2007, the company's balance showed total assets of
$521.4 million, total liabilities of $472.4 million, and total
stockholders' equity of $49 million.  The company's accumulated
deficit was $112.4 million at the end of the first quarter 2007.

                     Liquidity and Capital Resources

The company held cash and cash equivalents of $8.1 million at the
end of the first quarter 2007, as compared with $33.3 million at
the end of the first quarter 2006.  At March 31, 2007, the
company's debt structure consisted of $147 million aggregate
principal amount of senior subordinated notes, a senior secured
credit facility, consisting of:

      (i) a $251.8 million term loan facility with a maturity of
          seven years;

     (ii) capital lease obligations of $4.7 million with varying
          maturities; and

    (iii) a $75 million revolving credit facility, subject to
          availability, including sub-facilities for letters of
          credit and swingline loans, with a maturity of six
          years.  

The full amount available under the term loan facility was used in
connection with the Transactions.  During the three months ended
March 31, 2006, the company repurchased $3 million face value of
the company's senior subordinated notes for about $1.5 million.  
Accordingly, it recorded a gain on early extinguishment of debt of
about $1.5 million during this period.

A full-text copy of the company's first quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fe9

                    Lease Agreement and Termination

During the first quarter of 2007, the company terminated the lease
at the Doctors Hospital campus in Shreveport, Louisiana.  About
Seven beds were transferred to another location and the 12 beds
remaining at this location were closed.  During the same period,
eight beds were added to the company's Denver location.

On May 2, 2007, LifeCare REIT 1 Inc., a subsidiary of the company
entered into a Master Lease Agreement with Health Care REIT, Inc.
and HCRI Texas Properties LTD in connection with the sale and
leaseback of a 62-bed long term acute care hospital being
constructed by the company in San Antonio, Texas.  The Landlord
paid an initial acquisition payment of $11.7 million to the
Company towards the estimated total purchase price of
$15.7 million for the Facility.  The initial term of the Lease
will be 15 years, and the Tenant has one 15-year renewal option.

                     About LifeCare Holdings

LifeCare Holdings Inc. -- http://www.lifecare-hospitals.com/--  
develops and acquires hospitals that operate as long-term acute
care hospitals in the U.S.  As of Dec. 31, 2006, the company
operated 20 hospitals located in nine states, consisting of
12 "hospital within a hospital" long-term acute care facilities
and eight freestanding facilities.  The company has a total of
926 licensed beds and employs about 2,700 full-time and part-time
people.  LifeCare is wholly owned by LCI Holdco LLC, which is a
wholly owned subsidiary of LCI Holding Company Inc., both of which
are privately owned.  There is no public trading market for
LifeCare's equity securities.

                          *     *     *

LifeCare Holdings Inc. carries Moody's Investors Service's B3
corporate family rating and B1 senior secured credit facilities
rating.  The ratings outlook is negative.  LifeCare's senior
subordinated notes have Moody's Caa2 rating.


LIFEPOINT HOSPITALS: S&P Rates $500MM Sr. Convertible Notes at B
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
LifePoint Hospitals Inc.'s $500 million senior subordinated
convertible notes due 2014.  Proceeds of the new debt
issuance will be used to repay the amount outstanding under the
revolving credit facility and a portion of its outstanding term
loan.
     
At the same time, Standard & Poor's affirmed LifePoint's corporate
credit rating and secured bank loan rating of 'BB-' and revised
the recovery rating to '2' from '3', reflecting better recovery
prospects because there will be less secured bank debt
outstanding.  The rating outlook is stable.
     
LifePoint operates 51 facilities in 19 states.  Through
acquisitions, the company has grown from 30 hospitals to its
present size over the past two years.  These acquisitions expanded
LifePoint's market breadth with a much larger hospital portfolio,
improving the diversity of its revenues.
     
These various acquisitions, unexpected difficulties associated
with certain facilities, and more challenging industry conditions
contributed to the company's underperformance and increased lease-
adjusted debt to EBITDA to 4.1x as of Sept. 30, 2006, instead of
decreasing to a level that approached the low-3x area, as S&P had
expected.
      
"LifePoint's lowered guidance for 2007 reflects management's
opinion that the hospital environment will remain difficult for at
least the next year," said Standard & Poor's credit analyst David
P. Pecknay.  "Although the company has been able to reduce
leverage recently from small EBITDA growth and debt repayment with
asset sales proceeds, we believe that its credit profile will
remain consistent with the rating for the foreseeable future."
     
Challenging industry conditions for hospital providers include
higher bad debt, pricing pressures, and relatively weak patient
volume trends.  In addition, LifePoint remains subject to
uncertain third-party reimbursement, particularly from managed
care companies, as historically high annual rate increases may
diminish.


LYNX CHEMICAL: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Lynx Chemical Group, L.L.C.
        3003 Summit Boulevard, 14th Floor
        Atlanta, GA 30319

Bankruptcy Case No.: 07-41230

Type of Business: The Debtor is a custom manufacturer of chemical
                  specialties with a focus on technology and
                  products that are useful in industrial and
                  materials applications.  See
                  http://www.lynxchemical.com/

Chapter 11 Petition Date: May 23, 2007

Court: Northern District of Georgia (Rome)

Judge: Paul W. Bonapfel

Debtor's Counsel: William L. Rothschild, Esq.
                  Ellenberg, Ogier, Rothschild & Rosenfeld, P.C.
                  170 Mitchell Street Southwest
                  Atlanta, GA 30303-3424
                  Tel: (404) 525-4000

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Sasol North America              trade debt;           $395,878
P.O. Box 19029                   roscoe.cooley
900 Threadneedle Drive           @us.sasol.com
Houston, TX 77224

Paragon Technical Resources      trade debt            $227,333
5515 Bannergate Drive
Alpharetta, GA 30022

Olin Corp.                       trade debt;           $223,562
Bank of America                  PJBorden@olin.
Olin Corp.                       com
P.O. Box 402766
Atlanta, GA 30384-2766


Basic Chemicals Co., L.L.C.      trade debt;           $179,277
                                 Mike_Twilling@
                                 oxy.com

Cargill, Inc.                    trade debt            $154,526

Alchem Chemical Co.              trade debt;           $143,950
                                 actmharv@aol.com

Greif, Inc.                      trade debt;           $140,632
                                 James.Lack@
                                 greif.com

Alco Chemical                    trade debt            $133,811

Erco Worldwide                   trade debt;           $126,135
                                 cparker@
                                 ercoworldwide.
                                 com

Zinifex-Taylor Chemical, Inc.    jeff.taylor@          $119,719
                                 zinifex.com

Sasol Chemical, N.A.             trade debt;           $100,520
                                 David.Turner@
                                 us.sasol.com

Univar U.S.A., Inc.              trade debt;            $96,594
                                 laurie.barfield
                                 @univarusa.com

Clean Harbors Environmental      trade debt             $90,857
Services

Celanese                         trade debt             $89,404
                                 BHParker@
                                 celanese.com

Southern Ionics, Inc.            trade debt;            $79,794
                                 rweimer@
                                 southernionics.
                                 com

Airgas Specialty Products,       trade debt;            $70,149
                                 steve.roesler@
                                 airgas.com

Dupont Company                   trade debt;            $68,400
                                 Cheryl.J.Boone.
                                 @usa.dupont.com

Jim Corwell Mechanical           trade debt             $67,909
Contracting, Inc.

Legacy Chemical Corp.            frank@                 $61,965
                                 legacychemical.
                                 com

Georgia Pacific Resins                                  $57,262


MEDWAVE INC: Gets Nasdaq Non-Compliance and Stock Delisting Notice
------------------------------------------------------------------
Medwave Inc. received a NASDAQ Staff Determination letter, in
connection with the company's non-compliance with Marketplace Rule
4310(c)(14), which requires timely filing of periodic reports with
NASDAQ for continued listing.  The non-compliance with Marketplace
Rule 4310(c)(14) makes the company's common stock subject to being
delisted from The NASDAQ Stock Market.

The company disclosed that due to the departure of its chief
financial officer, the company was unable to timely file its Form
10-Q for the period ended March 31, 2007.  

The company said it is working with its independent public
accountants to finalize the Form 10-Q before May 29, 2007 to avoid
delisting.  If it is unable to meet the May 29, 2007 deadline, the
company said it may appeal any delisting determination.
    
Headquartered in Arden Hills, Minn., Medwave,Inc. (Nasdaq: MDWV)  
-- http://www.mdwv.com/-- develops, manufacturers and distributes   
sensor-based non-invasive blood pressure solutions.

                        Going Concern Doubt

Carlin, Charron & Rosen LLP, in Westborough, Mass., expressed
substantial doubt about Medwave Inc.'s ability to continue as a
going concern after auditing the company's financial statements
for the year ended Sept. 30, 2006, and 2005.  The auditing firm
pointed to the company's recurring net losses and accumulated
deficit of approximately $34,000,000 at Sept. 30, 2006.


MICHIGAN WATER: Improved Financials Cues S&P to Lift BB+ Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its rating on Sturgis,
Michigan's water supply and distribution system bonds to 'BBB-'
from 'BB+' due to the system's improving financial profile.  The
outlook is stable.
     
City management will need to maintain consistent watch over
utility rates and capital needs if it is going to effectively
manage the financial condition of the utility.  The water
utility's operations are expected to continue to improve with
support from annual rate increases through 2008, and any upward
movement in the rating will depend on the water system's continued
financial improvement.
     
Additional rating factors include a small but stable customer
base, adequate system capacity, and minimal legal provisions.
     
"Because of the system's tight operations, any further
deterioration in the water utility's financial position could
result in downward rating action," said Standard & Poor's credit
analyst Scott Garrigan.  "In order to maintain the rating, the
city will need to build its cash reserves and sustain debt service
coverage at or above 1x," he added.
     
From fiscal 2000-2003, financial indicators showed a deterioration
in the water utility's liquidity position.  From the fiscal years
ended Sept. 30, 2000 through 2003, the utility's unrestricted cash
position decreased to $0 from $857,000.  During that same time
period, annual debt service coverage fluctuated from just 0.3x-
1.6x. Since fiscal 2004, the system's financial performance has
been slowly improving.  Over that time, cash increased to
$237,000 and net revenues covered annual debt service by 1.16x at
fiscal year-end Sept. 30, 2006.  Management expects that for 2007,
the system's cash position will continue to grow over 2006 levels
and debt service coverage will remain at more than 1x.
     
Payment of debt service on the bonds is secured by the net
revenues, after operating expenses, of the water system.
     
Sturgis' water system serves a total of 4,263 customers,
approximately 85% of which are residential; the base has remained
stable for the past several years.
     
Approximately $410,000 of debt is affected.


ML-CFC COMMERCIAL: S&P Rates $6.964MM Class P Certificates at B-
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to ML-CFC Commercial Mortgage Trust 2007-7's $2.786
billion commercial mortgage pass-through certificates series
2007-7.
     
The preliminary ratings are based on information as of May 23,
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 loans, and the geographic
and property type diversity of the loans.  Class A-1, A-2, A-3, A-
SB, A-4, A-1A, AM, AJ, B, C, and D are currently being offered
publicly.  The remaining classes will be offered privately.  
Standard & Poor's analysis determined that, on a weighted average
basis, the pool has a debt service coverage of 1.24, a beginning
LTV of 111.7%, and an ending LTV of 104.1%.  Unless otherwise
indicated, all calculations in this presale report, including
weighted averages, do not include the subordinate nontrust B notes
relating to the Georgia-Alabama Retail Portfolio, Morehouse
Portfolio, Town & Country Shopping Center, Hillwood Apartments,
Ashton Lake Apartments, New Sunshine Tech Center, Super Center
Plaza, Quail Creek Plaza, and Somerset Meadows loans (3.2% of the
pool balance).
     
    
                   Preliminary Ratings Assigned
             ML-CFC Commercial Mortgage Trust 2007-7
   
      Class       Rating         Amount     Recommended credit
                                                 Support
      -----       ------         ------      ----------------
       A-1        AAA           $53,249,000      30.0000%
       A-2        AAA          $140,798,000      30.0000%
       A-3        AAA          $204,236,000      30.0000%
       A-SB       AAA          $102,788,000      30.0000%
       A-4        AAA          $842,917,000      30.0000%
       A-1A       AAA          $605,863,000      30.0000%
       AM         AAA          $278,551,000      20.0000%
       AJ         AAA          $219,358,000      12.1250%
       B          AA            $55,710,000      10.1250%
       C          AA-           $27,855,000       9.1250%
       D          A             $45,264,000       7.5000%
       A-2FL*     AAA                     -      30.0000%
       A-3FL*     AAA                     -      30.0000%
       A-4FL*     AAA                     -      30.0000%
       AM-FL*     AAA                     -      20.0000%
       AJ-FL*     AAA                     -      12.1250%
       E          A-             $27,856,000      6.5000%
       F          BBB+           $34,818,000      5.2500%
       G          BBB            $27,855,000      4.2500%
       H          BBB-           $24,373,000      3.3750%
       J          BB+            $10,446,000      3.0000%
       K          BB             $10,446,000      2.6250%
       L          BB-            $10,445,000      2.2500%
       M          B+              $6,964,000      2.0000%
       N          B               $6,964,000      1.7500%
       P          B-              $6,964,000      1.5000%
       Q          NR             $41,782,676      0.0000%
       X**        AAA         $2,785,502,676         N/A
   

*Floating-rate class. Ongoing ratings of floating-rate classes
will be partially dependent upon the rating of the swap
counterparty.

**Interest-only class with a notional amount.

NR -- Not rated.

N/A -- Not applicable.


MORTGAGE LENDERS: Wants Until September 3 to Decide on Leases
-------------------------------------------------------------
Mortgage Lenders Network USA Inc. asks the U.S. Bankruptcy Court
for the District of Delaware to extend the period within which it
may assume or reject unexpired leases, subleases or other
agreements of nonresidential real property to Sept. 3, 2007.

The Debtor notes that Section 365(d)(4) of the Bankruptcy Code
provides that the Court may extend the period within which a
debtor may assume, assume and assign, or reject unexpired leases,
prior to the expiration of the 120-day period, for 90 days upon
motion of the trustee or lessor for cause.

Since filing for bankruptcy, the Debtor says it has focused its
efforts on:

   (i) completing the smooth transition of operations as a
       Chapter 11 debtor-in-possession;

  (ii) negotiating and obtaining postpetition use of cash
       collateral necessary for continued operation;

(iii) coordinating the transfer and servicing of loans; and

  (iv) liquidating its remaining assets.

The Debtor anticipates a need to retain its lease for 213 Court
Street, in Middletown, Connecticut, for some period of time past
June 5, 2007, the current lease decision deadline, Laura Davis
Jones, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub
LLP, in Wilmington, Delaware, relates.

Also, the two leases at 10 Research Parkway, in Wallingford,
Connecticut, may be of interest to parties acquiring the Debtor's
loan servicing platform, which is currently on sale, Ms. Jones
asserts.  Hence, the Debtor needs more time to assume or reject
the Unexpired Leases, she says.

Ms. Jones notes that the Unexpired Leases are very important to
the continuing operation of the Debtor's businesses and have
potential value in connection with the platform sale.
Accordingly, it would be imprudent and detrimental for the Debtor
to decide on the Unexpired Leases within the 120-day period
specified in Section 365(d)(4), Ms. Jones contends.

Moreover, Ms. Jones says, without the extension, the Debtor is at
risk of assuming the Unexpired Leases that may later be
burdensome to the bankruptcy estate by creating unnecessary
administrative claims, or rejecting them that may later be
discovered as critical to the Debtor's businesses.  Therefore,
under these circumstances, the most appropriate course of action
is to extend the deadline for additional 90 days, she adds.

The Debtor has timely performed all of its postpetition
obligations under the Unexpired Leases, Ms. Jones assures the
Court.

                     About Mortgage Lenders

Middletown, Conn.-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- is a privately held company offering
a full range of Alt-A/Non-Conforming and Conforming loan products
through its retail and wholesale channels.  The company filed for
chapter 11 protection on Feb. 5, 2007 (Bankr. D. Del. Case No.
07-10146).  Pachulski Stang Ziehl Young Jones & Weintraub LLP
represents the Debtor.  Blank Rome LLP represents the Official
Committee of Unsecured Creditors.  In the Debtor's schedules of
assets and liabilities filed with the Court, it disclosed total
assets of $464,847,213 and total debts of $556,459,464.  

The Debtor's exclusive period to file a chapter 11 plan expires on
June 5, 2007.  (Mortgage Lenders Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/
or 215/945-7000).


MORTGAGE LENDERS: Landlord Balks at Lease Decision Extension Plea
-----------------------------------------------------------------
VLG Wallingford Partners, LLC, is the landlord of the property
located at 10 Research Parkway, Wallingford, Connecticut.

On behalf of VLG Wallingford, Joanne P. Pinckney, Esq., in
Wilmington, Delaware contends that if Mortgage Lenders Network
USA, Inc.'s need to decide on the Premises' lease is because of
the sale of the Debtor's loan servicing operation, which would
need 30 days to complete, there is no reason for an extension of
90 days to decide on those leases.

Ms. Pinckney notes that since the Debtor's bankruptcy filing, VLG
has received inquiries concerning the availability of the
Premises.  She argues that granting a 90-day extension would
create substantial hardship for VLG because it may lose the
opportunity to lease the Premises to another tenant.

Since the Debtor needs only a 30-day extension to complete the
sale of its loan servicing operation and since VLG Wallingford
may be substantially prejudiced by a 90-day extension, the Court
should limit the extension of time to 30 days, until July 3,
2007, in which Debtor may assume, assume and assign or reject the
lease of the Premises, Ms. Pinckney says.

                      About Mortgage Lenders

Middletown, Conn.-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- is a privately held company offering
a full range of Alt-A/Non-Conforming and Conforming loan products
through its retail and wholesale channels.  The company filed for
chapter 11 protection on Feb. 5, 2007 (Bankr. D. Del. Case No.
07-10146).  Pachulski Stang Ziehl Young Jones & Weintraub LLP
represents the Debtor.  Blank Rome LLP represents the Official
Committee of Unsecured Creditors.  In the Debtor's schedules of
assets and liabilities filed with the Court, it disclosed total
assets of $464,847,213 and total debts of $556,459,464.  

The Debtor's exclusive period to file a chapter 11 plan expires on
June 5, 2007.  (Mortgage Lenders Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/  
or 215/945-7000).


MASTR ASSET: S&P Puts Low-B Ratings of Three Classes Under Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on seven
classes from four MASTR Asset Backed Securities Trust transactions
on CreditWatch with negative implications.  At the same time, the
rating on one class remains on CreditWatch negative.
     
The negative CreditWatch placements reflect pool performance that
has considerably lowered projected credit support for the affected
classes.  All four deals have higher-than-expected foreclosure and
REO amounts, with sums that exceed the current
overcollateralization amounts.
     
Series 2005-OPT1 has severe delinquencies (90-plus days,
foreclosure, and REO) that are approximately 5.7x O/C.  Series
2006-FRE1 is seasoned 13 months and has severe delinquencies that
are approximately 19.5x O/C.  Series 2006-FRE2 has severe
delinquencies that are 7.8x O/C.  Series 2006-HE2 is seasoned nine
months, and severe delinquencies are approximately 7.6x O/C.
     
These performance trends have caused projected credit support for
these transactions to fall well below the required levels.  
However, excess interest has outpaced losses over the past six
months, and the realized losses have not been high enough to
substantially reduce actual credit support.
     
Standard & Poor's will continue to closely monitor the performance
of these transactions.  If delinquencies decline and no
significant losses have been incurred, S&P will affirm the ratings
and remove them from CreditWatch.  Conversely, if these
transactions incur considerable losses and the delinquencies
continue to increase, S&P will take further negative rating
actions.
     
Credit support for the transactions is provided by subordination,
excess interest, and O/C.  The underlying collateral backing the
certificates consists of both fixed- and adjustable-rate mortgage
loans (primarily first-lien) secured by one- to four-family
residential properties.  Series 2006-FRE2 has 5.81% of second-lien
loans.
   

              Ratings Placed on Creditwatch Negative
   
               MASTR Asset Backed Securities Trust
            Residential mortgage-backed certificates

                                         Rating
                                         ------
           Series      Class      To               From
           ------      -----      --               ----
           2005-OPT1   M-11       BBB-/Watch Neg    BBB-
           2006-FRE1   M-7        BBB+/Watch Neg    BBB+
           2006-FRE1   M-8        BBB/Watch Neg     BBB
           2006-FRE2   M-9        BBB-/Watch Neg    BBB-
           2006-FRE2   M-10       BB+/Watch Neg     BB+
           2006-FRE2   M-11       BB/Watch Neg      BB
           2006-HE2    M-11       BB/Watch Neg      BB
            

              Rating Remaining on Creditwatch Negative
   
                MASTR Asset Backed Securities Trust
             Residential mortgage-backed certificates
   
                   Series      Class      Rating
                   ------      -----      ------
                   2006-FRE1   M-9        BBB-/Watch Neg


NEFF RENTAL: Prices Cash Tender Offerings on Two Senior Notes
-------------------------------------------------------------
Neff Rental LLC and Neff Finance Corp. has priced their cash
tender offers to repurchase any and all of the outstanding
11-1/4% Second Priority Senior Secured Notes due 2012
(CUSIP No. 640096AC7) and their 13% Senior Subordinated Notes due
2013.  

The tender offers and consent solicitations are made upon the
terms and subject to the conditions set forth in the Offer to
Purchase and Consent Solicitation Statement relating to the Senior
Notes and the Offer to Purchase and Consent Solicitation Statement
relating to the Senior Subordinated Notes, each of which is dated
May 4, 2007 and the related Consents and Letters of Transmittal.
    
The total consideration for the Senior Notes was determined as of
2:00 p.m., New York City time, on May 22, 2007, using the yield of
the 4-7/8% U.S. Treasury Note due May 15, 2009, plus a fixed
spread of 50 basis points and based on the expected initial
settlement date of May 31, 2007.  The yield on such reference
security was 4.841% and the tender offer yield was 5.341%.

Accordingly, the total consideration, excluding accrued and unpaid
interest, for each $1,000 principal amount of Senior Notes validly
tendered and not withdrawn on or prior to 5:00 p.m., New York City
time, on May 17, 2007 is $1,163.20, which includes a consent
payment of $30.  The purchase price payable in respect of Senior
Notes validly tendered after the Consent Payment Deadline and
purchased pursuant to the tender offer therefore is $1,133.20 per
$1,000 principal amount of Senior Notes, which represents the
total consideration for the Senior Notes less the consent payment.
    
The total consideration for the Senior Subordinated Notes was
determined as of 2:00 p.m., New York City time, on May 22, 2007,
using the yield of the 3-5/8% U.S. Treasury Note due June 30,
2007, plus a fixed spread of 50 basis points and based on the
Initial Settlement Date.  The yield on such reference security was
5.049% and the tender offer yield was 5.549%.  Accordingly, the
total consideration, excluding accrued and unpaid interest, for
each $1,000 principal amount of Senior Subordinated Notes validly
tendered and not withdrawn on or prior to the Consent Payment
Deadline is $1,032.70, which includes a consent payment of $30.

The purchase price payable in respect of Senior Subordinated Notes
validly tendered after the Consent Payment Deadline and purchased
pursuant to the tender offer therefore is $1,002.70 per $1,000
principal amount of Senior Subordinated Notes, which represents
the total consideration for the Senior Subordinated Notes less the
consent payment.
    
The tender offer and consent solicitation for each series of Notes
will expire at 5:00 p.m., New York City time, on June 6, 2007,
unless extended or earlier terminated by the companies.  The
tender offer and consent solicitation for each series of Notes is
conditioned on the satisfaction of certain conditions as described
in the Offers to Purchase, including:

   1) the consummation of the proposed merger of LYN Acquisition
      Corp., which is an affiliate of Lightyear Capital LLC, with
      and into Neff Corp., the parent company of the Companies,
      pursuant to the Agreement and Plan of Merger, dated as of
      March 31, 2007, by and among LYN Holdings LLC, LYN Holding
      Corp., Merger Sub and Neff Corp.;

   2) Merger Sub or its affiliates having obtained an aggregate of
      $736.6 million of debt financing on the terms and conditions
      contained in their debt financing commitments; and

   3) certain other customary conditions.
    
The complete terms and conditions of the offers are described in
the Offers to Purchase, which may be obtained by contacting D.F.
King & Co. Inc., the information agent for the offers, at (212)
269-5550 (collect) or (800) 628-8536 (U.S. toll-free).  

Banc of America Securities LLC is the exclusive dealer manager and
solicitation agent for the tender offers and consent
solicitations.  Additional information concerning the tender
offers and consent solicitations may be obtained by contacting
Banc of America Securities LLC, High Yield Special Products, at
(704) 388-9217 (collect) or (888) 292-0070 (U.S. toll-free).

                      About Neff Rental LLC

Headquartered in Miami, Florida, Neff Rental LLC is one of the
nation's construction and industrial equipment rental companies,
operating through its subsidiary Neff Rental Inc.  Neff's primary
focus is in ground-engaging equipment and its fleet includes the
latest earth moving equipment, compressors, generators and lifts
from leading manufacturers.  Neff operates through its network
branches located in the Southeastern, Mid-Atlantic, Central and
Western regions of the United States.

                          *     *     *

As reported in the Troubled Company Reporter on April 5, 2007,
Moody's Investors Service is reviewing the ratings of Neff Rental
LLC for possible downgrade in response to the Neff Corp.'s report
that it has signed a definitive agreement to be acquired by Light
year Capital LLC, a private equity firm, in a transaction valued
at approximately $900 million including the assumption of certain
liabilities.  The ratings under review were: (i) corporate family
rating, B3; (ii) probability of default, B3; and (iii) second
priority senior secured notes, Caa1, LGD4, 64%.


NEPTUNE INDUSTRIES: Posts Equity Deficit of $1,579,698 at March 31
------------------------------------------------------------------
As of March 31, 2007, Neptune Industries Inc. reported a total
stockholders' deficiency of $1,579,698 from total assets of
$2,409,704 and total liabilities of $3,989,402.  The company held
$1,470,681 in cash and cash equivalents as of March 31, 2007.

Total losses for the third quarter ended March 31, 2007, were
$1,616,148, as compared with a loss for the nine months ended
March 31, 2006 of $832,917.  However, the loss for the nine months
ended March 31, 2006, included the one-time expense charge of
$194,292 as the present value of stock options granted effective
July 1, 2006, under current accounting rules, non-recurring
expenses relating to the private offering of $525,528 and investor
relations fees paid in stock of $80,000.

Gross revenues for the quarters ended March 31, 2007, and 2006
were $203,379 and $124,918, respectively, resulting from the
increased capacity of the farm.  Cost of sales for the same
periods were $224,742 and $275,877, resulting in gross loss of
$21,363 and $150,959, respectively.  Operating expenses for the
quarters ended March 31, 2007, and 2006 were $772,702 and
$163,336, resulting in net losses of $853,431 for the quarter
ended March 31, 2007, as compared to $338,831 for the quarter
ended March 31, 2006.

A full-text copy of the company's third quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?1fec

                     About Neptune Industries

Headquartered in Boca Raton, Fla., Neptune Industries Inc.
(OTCBB: NPDI) -- http://www.neptuneindustries.net/-- is a public  
corporation that engages in commercial fish farming and related
production and distribution activities in the seafood and
aquaculture industries.

Neptune Industries, Inc. has developed a scalable, modular
aquaculture technology called Aqua-Sphere(TM) and Aqua-Cell(TM)
that addresses the environmental concerns of most aquaculture
operations by controlling and recycling all waste products, while
ensuring the production of the highest quality fish at an
affordable price.  The company currently operates the Blue Heron
Aqua Farms in Florida City, FL and is a leading producer of hybrid
striped bass, which it markets internationally as Everglades
Striped Bass(TM).  The company's current production at its Blue
Heron farm, and future production with Aqua-Sphere(TM) System
technology are intended to target the organic market soon as
organic certification of farm-raised seafood becomes available.
The company is also in development of an advanced dietary
nutritional component called Ento-Protein(TM).  Ento-Protein(TM)
is a high quality sustainable protein derived from insects, and is
intended to be a replacement for the scarce fishmeal now used in
fish and animal diets.  

                       Going Concern Doubt

Dohan and Company CPAs, PA, in Miami, Florida, expressed
substantial doubt about Neptune Industries Inc.'s ability to
continue as a going concern after auditing the company's financial
statements for the year ended June 30, 2006.  The auditing firm
pointed to the company's recurring losses from operations and
working capital deficiency.


NEW CENTURY: Turns to Grant Thornton for Tax Accounting Services
----------------------------------------------------------------
New Century Financial Corporation and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware to approve
their application to employ Grant Thornton LLP as their tax
accountant, nunc pro tunc to April 2, 2007.

Grant Thornton is the United States member firm of Grant
Thornton International, one of six global accounting, tax and
business advisory organizations.  Through member firms in 110
countries, including 49 offices in the U.S., the partners of
Grant Thornton member firms provide personalized attention and
the highest quality service to public and private clients around
the globe, Monika L. McCarthy, the Debtors' senior vice president
and assistant general counsel, tells the Court.

Grant Thornton provides professional services, tax compliance and
advisory services, and business advisory services.  The firm also
covers areas in construction, real estate and hospitality,
consumer and industrial products, health care, and technology
industries.  Specifically, Grant Thornton has experience working
with banks and thrifts, broker-dealers, hedge funds, mortgage
banks, mutual funds, financial services publications, and
specialty finance companies, Ms. McCarthy relates.

The Firm has served as tax accountants and consultants to many
large, complex organizations, and has significant experience
providing tax services to various clients in the subprime
mortgage industry, Ms. McCarthy notes.

Before their bankruptcy filing, the Debtors tapped Grant Thornton
to provide general tax services.  As a result, the firm has
developed considerable knowledge of the Debtors' operations and
finances and is well positioned to serve as their tax accountant,
Ms. McCarthy points out.

Grant Thornton will:

   (a) prepare the Consolidated U.S. Corporation Income tax
       Return on Form 1120, including Schedules M-3 for the year
       ending December 321, 2006, and, if requested by the
       Debtors, for the year ending December 31, 2007;

   (b) prepare any applicable state tax returns;

   (c) assist with the calculation of estimated 2007 federal and
       state quarterly estimated tax payments;

   (d) provide general corporate tax consulting, including
       potential bankruptcy tax-related issues.

The Debtors have sought to retain accounting professionals in
addition to Grant Thornton.  They believe it is in the best
interest of the estates to have different firms work on different
projects depending on the size of the matter involved and the
respective expertise of different accounting professionals.  The
Debtors represent that they will take steps to make certain that
the services to be rendered by Grant Thornton will not duplicate
the services to be rendered by any other professionals employed
by the Debtors.

The Debtors will pay Grant Thornton in accordance with its hourly
rates, and reimburse expenses incurred in providing the services.  
The rates are:

              Partner/Director             $530 - $715
              Senior Manager               $465 - $550
              Manager                      $405 - $460
              Senior Associate             $305 - $385
              Associate                    $215 - $250
              Administrative/               $75 - $175
                 Paraprofessional

Grant Thornton is owed $10,800 as of the Petition Date for
services provided prepetition.  To ensure compliance with Section
327(a) of the Bankruptcy Code, the firm will waive any claim it
may have with respect to the amount.  During the 90 days before
the Petition Date, the Debtors paid invoices amounting to
$943,250 to Grant Thornton.

Don W. Dahl, a partner at Grant Thornton, discloses that the firm
has in the past worked with, continues to work with, and has
mutual clients with, certain law firms who represent parties-in-
interest in the Debtors' Chapter 11 cases.  None of the
engagements or relationships relate to the Debtors' cases and the
firm will not represent parties-in-interest in matters relating
to the cases, he adds.

The firm holds or represents no interest materially adverse to
the Debtors or their estates, Mr. Dahl tells the Court.  He
attests that the firm is a disinterested person, as the term is
defined in Section 101(14).

                        About New Century

Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real  
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation.  The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.

The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416).  Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors.  The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.

When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950.  The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007.  (New Century Bankruptcy News, Issue No. 11; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).

The Debtors' exclusive period to file a plan expires on July 31,
2007.


NEW CENTURY: Engages Irell & Manella as Special Counsel
-------------------------------------------------------
On April 17, 2007, a class action lawsuit relating to New Century
Financial Corporation and its debtor-affiliates' alleged violation
of the Worker Adjustment and Retraining Notification Act, 29
U.S.C. Section 2101 et. seq. and California Civil Code Section
1400, et. seq., was filed in the Debtors' Chapter 11 cases.

The WARN Class Action relates to various prepetition employee
terminations, and the plaintiffs seek allowance of a claim for 60
days of wages and benefits for each employee terminated, and
attorney's fees and costs, on an administrative priority claim
basis.

Monika L. McCarthy, the Debtors' senior vice president and
assistant general counsel, relates that in addition to the
defense of the WARN Class Action, the Debtors are in need of
advice relating to possible additional employee terminations.

The Debtors have requested that Irell & Manella LLP provide
advice relative to certain insurance matters that arise from time
to time.  The Debtors also asked Irell & Manella to represent
them in employee benefit matters, including with respect to the
wind-up of the Debtors' benefit plans, and issues concerning
their Consolidated Omnibus Budget Reconciliation Act obligations.  

Irell & Manella performed an insurance policy review for certain
of the Debtors in early 2005.  Since January 6, 2006, the firm
has not performed any services for the Debtors.  The Debtors
timely paid Irell & Manella for its services.

Ms. McCarthy tells the U.S. Bankruptcy Court for the District of
Delaware that Irell & Manella has experience in virtually all
aspects of the law that may arise in connection with the proposed
representation.  It has served as counsel in other large class
action litigation matters, including Broadcom Securities Class
Action, Cheesecake Factory Securities Class Action, and Charter
Communications Securities Class Action.

Irell & Manella has also served as litigation counsel, insurance
litigation counsel and bankruptcy counsel for First Alliance
Mortgage Company and Imperial Credit Industries, Inc., among
others.  Recently, the firm has also provided assistance in
matters concerning employee benefit plans for First Alliance,
Chevys, and Furrs Supermarkets.

In accordance with the terms in the retainer agreement between
the firm and the Debtors, Irell & Manella will provide, ordinary
and necessary legal services, in connection with:

    -- the WARN Class Action;
    -- insurance matters; and
    -- employee benefit matters, including issues relating to the
       wind down of the Debtors' benefit plans and their COBRA
       obligations.

The Debtors do not intend for Irell & Manella to be responsible
for the provision of substantive legal advice outside the areas
of expertise for which it is being retained.  The firm is also
not required to devote attention to, form professional opinions
as to, or advise the Debtors with respect to their disclosure
obligations under federal or state securities or other non-
bankruptcy laws or agreements.

The firm will be paid according to its customary hourly rates,
which are adjusted periodically, typically on January 1 of each
year:

              Attorneys                    $275 - $805

              Litigation Support, Legal    $110 - $350
                 Assistants, Paralegals             

The Debtors will reimburse Irell & Manella according to its
customary reimbursement policies.

Jeffrey M. Reisner, Esq., a partner at Irell & Manella, has
advised the Debtors that the firm has not, does not, and will not
represent any parties-in-interest with respect to matters related
to their Chapter 11 cases.  He adds that neither the firm nor any
of the attorneys employed by it have any material connection with
the Debtors, their creditors, the Official Committee of Unsecured
Creditors, the Office of the United States Trustee, any other
party with an actual or potential interest in these cases, or
their attorneys or accountants.

Mr. Reisner discloses that the firm currently represents
affiliates of certain creditors, including UBS Real Estate Group,
Citigroup Global Markets Realty Corporation, and J.P. Morgan
Chase & Co., in matters unrelated to these cases.

Irell & Manella represents no interest adverse to the Debtors in
the matters for which the firm is to be retained, Mr. Reisner
tells the Court.

Accordingly, the Debtors seek the Court's authority to employ
Irell & Manella as their special litigation, employee benefits and
insurance counsel, nunc pro tunc to April 20, 2007.

                        About New Century

Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real  
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation.  The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.

The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416).  Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors.  The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.

When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950.  The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007.  (New Century Bankruptcy News, Issue No. 11; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).

The Debtors' exclusive period to file a plan expires on July 31,
2007.


NORTHEAST COMMERCIAL: Case Summary & Nine Largest Unsec. Creditors
------------------------------------------------------------------
Debtor: Northeast Commercial Services Corporation
        1249 Washington Boulevard, 28th Floor
        Detroit, MI 48226

Bankruptcy Case No.: 07-50166

Chapter 11 Petition Date: May 23, 2007

Court: Eastern District of Michigan

Judge: Phillip J. Shefferly

Debtor's Counsel: Michael P. DiLaura, Esq.
                  105 Case Avenue
                  Mount Clemens, MI 48043
                  Tel: (586) 468-5600

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's Nine Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Kraemer Design Group, P.L.C.     location: 1249         unknown
400 Grand River Avenue           Washington
Detroit, MI 48226                Boulevard,
                                 Detroit, MI;
                                 value of
                                 security:
                                 $7,000,000
                                 value of senior
                                 lien: $4,181,860

Susan Lambrecht                  purchase of         $1,500,000
16991 18 Mile Road               building
Clinton Township, MI 48038

J.C. Beal Construction           construction           $70,000
221 Felch                        consulting
Ann Arbor, MI 48103

City of Detroit Water &          water services         $41,976
Sewage

Prudential Protective            security                $8,000
Services                         services

Guardian Bonded Security                                 $4,441

Detroit Redevelopment                                    $1,000
Authority

AT&T                             phone services            $904

K.E.M.-T.E.C. Land Surveyors                               $225


NORTHWEST AIRLINES: S&P to Put B+ Rating Upon Bankruptcy Emergence
------------------------------------------------------------------
Standard & Poor's Ratings Services expects to assign its 'B+'
corporate credit rating to Northwest Airlines Corp. and subsidiary
Northwest Airlines Inc. (both rated 'D') upon their emergence from
bankruptcy, anticipated May 31, 2007.  The rating outlook is
expected to be stable.  In addition, S&P expect to assign its 'BB-
' bank loan rating to Northwest Airlines Inc.'s $1.225 billion
secured exit financing bank credit facility.  The expected 'BB-'
bank loan rating would be one notch above the expected 'B+'
corporate credit rating, with a recovery rating of '1', based on
S&P's expectation of a full recovery of principal in the event of
a second Northwest bankruptcy.  S&P also intend to resolve its
CreditWatch review of various enhanced equipment trust
certificates, and withdraw its 'BBB-' rating on Northwest's
debtor-in-possession credit facility upon the company's bankruptcy
emergence.
      
"The expected 'B+' corporate credit rating reflects Northwest's
participation in the competitive, cyclical, and capital-intensive
U.S. airline industry, on a still highly leveraged financial
profile, and with substantial upcoming capital expenditures to
modernize its aircraft fleet," said Standard & Poor's credit
analyst Philip Baggaley.  "The rating also incorporates the
airline's improved operating cost structure and reductions in debt
and leases achieved in Chapter 11."
     
Northwest used the bankruptcy process to institute various
changes, many of them similar to those undertaken by other
reorganizing "legacy carriers": Reduce total costs by about
$2.2 billion, of which $1.4 billion relate to labor and pension
expense (a 37% reduction), with a further $200 million expected to
be in place by 2008 (the cumulative total of $2.4 billion would be
equal to about 20% of 2004 pretax expenses); Shrink its aircraft
fleet and reduce capacity about 10%, dropping certain unprofitable
routes, though it also affirmed existing aircraft delivery
contracts and placed a new order for large regional jets; and
Reduce debt and leases by $4.2 billion (about 30% of year-end 2004
debt and leases, though less than one-quarter of fully adjusted
debt, including pension and other retiree liabilities).
     
S&P expect to assign a 'BB-' bank loan rating, with a '1' recovery
rating, to Northwest Airlines Inc.'s $1.225 billion bankruptcy
exit financing, based on our expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.  The
credit agreement will consist of a $175 million revolving credit
and a $1.05 billion term loan, both due May 31, 2012, and will be
guaranteed by parent Northwest Airlines Corp.  The facility will
be secured by Northwest Airlines Inc.'s valuable Pacific route
authorities from the U.S. to Japan, China, and Hong Kong (all
restricted markets).  In a simulated default scenario stressed
collateral value is sufficient to fully repay principal under the
facility and  also cover $300 million of pari passu claims by
other parties.


NT HOLDING: Madsen & Associates Raises Going Concern Doubt
----------------------------------------------------------
Madsen & Associates CPA's, Inc., of Salt Lake City, Utah,
expressed substantial doubt about NT Holding Corp.'s ability to
continue as a going concern after auditing the company's financial
statements for the year ended Dec. 31, 2006.  The auditor pointed
to the company's difficulty in generating sufficient cash flow to
meet its obligations and sustain its operations.

The company posted a net loss of $641,813 on revenues of
$9,891,094 for the year ended Dec. 31, 2006, as compared with a
net loss of $1,139,221 on $0 revenues in the prior year.

For the year ended Dec. 31, 2006, total operating expenses grew to
$1,289,283 from $1,157,946 in the prior year.  Losses from
operations doubled to $2,416,473 for the year ended Dec. 31, 2006,
from $1,157,946 in the prior year.

At Dec. 31, 2006, the company's balance sheet showed $21,113,512
in total assets, $18,503,985 in total liabilities, and $3,314,481
in minority interest, resulting to $704,954 in stockholders'
deficit.  The company also had a negative working capital with
$9,723,641 in total current assets and $18,196,568 in total
current liabilities.

                        Operating Expenses

For the year ended Dec. 31, 2006, the company incurred a total of
$18,434 selling and distribution expenses to support operations.  
Compared to the year ended Dec. 31, 2005, selling and distribution
expenses increased by $18,434 or 100%.  Such increase is
attributable to the acquisition of Jinhai Metal Group operations
during 2006.  Jinhai incurred selling and distribution expenses
during 2006 for marketing its products to its customers.

The company incurred a total of $705,910 general and
administrative expenses for the year ended Dec. 31, 2006 as
compared to $1,157,946 for the year ended Dec. 31, 2005.  General
and administrative expenses for year ended Dec. 31, 2005 was
mainly due to the issuance of shares for services that include
315,000 shares of its common stock for consulting services on Dec.
15, 2005 valued at $0.26 per share, 10,000 shares of its common
stock for legal services on Dec, 30, 2005 valued at $0.65 per
share, and 1,270,000 shares of its common stock on a filing on
Form S-8 on Dec. 30, 2005 value at $0.65 per share.

                   Loss Before Minority Interest

In 2006, reported a net loss before minority interest of
$2,412,583, as compared to a net loss before minority interest of
$1,157,533 for the year ended Dec. 31, 2005.  The net loss before
minority interest in the current year increased by $1,255,050.

A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1f91

                         About NT Holding

Based in Hong Kong, China, NT Holding Corp. -- (OTC BB: NTHHE) --
http://www.ntholdingcorp.com/-- invests in and operates companies  
in China that engage in the energy and natural resources
businesses.  The company currently invests in and operates two
subsidiaries: Shanxi Jinhai Metal Group that engages in coking
coal and steel production in the Shanxi Province and PT Borneo
Mineral that owns a 30-year coal mining right concession in
Indonesia.


OCCAM NETWORKS: Faces Nasdaq Delisting Due to Delayed Filing
------------------------------------------------------------
Occam Networks Inc has received from the Nasdaq Stock Market a
notice that the company has not timely filed its Quarterly Report
on Form 10-Q for the three months ended March 31, 2007.  Nasdaq
Stock said that the company is not in compliance with its
Marketplace Rule 4310(c)(14).

Occam Networks explains its Audit Committee is conducting a
review of its prior revenue recognition practices that caused in
the delay of the filing of its Form 10-Q and Form 10-K for the
fiscal year ended Dec. 31, 2006.

Nasdaq Stock states that it will continue to broadcast an
indicator over its market data dissemination network noting
Occam's non-compliance.  The notice, however, does not constitute
a trading halt or delisting.

The NASDAQ Listing Qualifications Panel scheduled a hearing on
May 31, 2007.  Occam Networks said that its appeal resulted in an
automatic stay of the delisting and the company's common stock
will remain listed on The NASDAQ Global Market pending a decision
by the Listing Qualifications Panel.

Last month, the company also received a notice from the Nasdaq
Stock stating that Occam is not in compliance with NASDAQ'S
Marketplace Rule 4310(c)(14) because Occam has not timely filed
its Report on Form 10-K for the fiscal year ended Dec. 31, 2006.

                       About Occam Networks

Based in Santa Barbara, California, Occam Networks Inc.
(OTCBB:OCNW) -- http://www.occamnetworks.com/-- develops and  
markets innovative Broadband Loop Carrier networking equipment
that enable telephone companies to deliver voice, data and video
services.  Based on Ethernet and Internet Protocol technologies,
Occam's equipment allows telecommunications service providers to
profitably deliver traditional phone services, as well as advanced
voice-over-IP, residential and business broadband, and digital
television services through a single, all-packet access network.

As of Sept. 24, 2006, the company's balance sheet showed a
stockholders' deficit of $16,276,000.


OMNOVA SOLUTIONS: Completes $162 Million Sr. Notes Tender Offering
------------------------------------------------------------------
OMNOVA Solutions Inc. has completed its tender offer for any and
all of its outstanding 11-1/4% senior secured notes due 2010
(CUSIP No. 682129AC5).  According to the company's depositary of
the tender offer, as of 8:00 a.m. on May 22, 2007, $162 million
aggregate principal amount of the Notes, approximately 98.182% of
the aggregate principal amount of the Notes outstanding, have been
validly tendered.  The company has accepted these Notes for
repurchase.
    
The company is refinancing the Notes with a new $150 million,
seven-year Term Loan B and an amended and extended five-year $80
million asset-based loan.  The Term Loan B is priced at LIBOR +
250 basis points, and the ABL pricing is LIBOR + 150 basis points.
    
"This is a very positive step forward for OMNOVA Solutions and
reflective of the significant operating improvements it has made
across the company," Kevin McMullen, OMNOVA Solutions' chairman
and chief executive officer, said.  "The refinancing of the Notes
will provide interest expense savings of approximately 350 basis
points or nearly $6 million per annum based on today's debt level
and interest rates.  In addition to the significantly reduced
interest expense, the company has extended its debt maturities and
increased the company's financial flexibility."
    
On May 4, 2007, the company received the requisite consents to
adopt the proposed amendments to the indenture governing the Notes
and the Notes pursuant to the consent solicitation.  The company
also disclosed that on May 4, 2007, the determination of the
consideration payable in accordance with the terms of the offer to
purchase and consent solicitation statement for the Notes.  

Holders who validly tendered and did not validly withdraw their
Notes and related consents before 5:00 p.m., New York City time,
on May 3, 2007, will receive, for each $1,000 principal amount of
Notes tendered, Total Consideration equal to $1,058.10, which
includes a $30 consent payment.  

Holders who tendered their Notes and delivered their consents
after the Consent Date, but before the Expiration Date, will
receive, for each $1,000 principal amount of Notes tendered,
Tender Offer Consideration equal to $1,028.10, which is the Total
Consideration less the Consent Payment.  Accrued and unpaid
interest to, but not including, the payment date will be paid to
Holders of record on May 15, 2007, whose Notes are validly
tendered and accepted for purchase.
    
                    About OMNOVA Solutions Inc.

Based in Fairlawn, Ohio, OMNOVA Solutions Inc. (NYSE: OMN) --
http://www.OMNOVA.com/-- is a specialty chemical producer.  The    
company has positions in styrene-butadiene latex production, vinyl
wallcovering, coated fabrics and decorative laminates.  

                          *     *     *

As reported in the Troubled Company Reporter May 9, 2007, Fitch
Ratings has affirmed and simultaneously withdrawn these ratings
for Omnova Solutions Inc.: (i) issuer default rating at 'B+'; (ii)
senior secured revolver at 'BB+/RR1'; and (iii) senior secured
notes at 'B+/RR4'.

At the same time, Moody's Investors Service assigned a B2 rating
to OMNOVA Solutions Inc.'s proposed $150 million guaranteed senior
secured term loan due 2014.  The term loan proceeds will partially
refinance the $165 million of outstanding senior secured notes due
2010 that OMNOVA recently issued a tender offer for.  The rating
outlook remains positive.


PAC-WEST TELECOMM: Committee Balks at Terms of $18.5MM Financing
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in Pac-West Telecomm
Inc. and its debtor-affiliates' Chapter 11 cases opposes a
proposed $18.5 million financing from Pac-West Funding Co. LLC, an
affiliate of Columbia Ventures Corp., Bill Rochelle of Bloomberg
News reports.

According to the report, the Committee asks the U.S. Bankruptcy
Court for the District of Delaware to deny the new financing
arguing that its "terms [are] designed to benefit only the
Debtor's prepetition lender."

The Committee also noted that the financing would give Pac-West
$7 million in cash while extending the lender's security interest
to all of the company's property, including lawsuits, the source
says.

The Court is set to decide on the matter on May 29, 2007.

Headquartered in Stockton, California, founded in 1980 and first
incorporated in 1981, Pac-West Telecomm Inc. (OTC: PACW.PK) --
http://www.pacwest.com/-- is a local exchange carrier.  Pac-
West's network averages over 120 million minutes of voice and data
traffic per day, and carries an estimated 20% of the dial-up
Internet traffic in California.  In addition to California, Pac-
West has operations in Nevada, Washington, Arizona, and Oregon.

The company and its affiliates filed for Chapter 11 protection on
April 30, 2007 (Bankr. D. Del. Case Nos. 07-10562 through 07-
10567).  Jeremy W. Ryan, Esq. and Norman L. Pernick, Esq. of Saul,
Ewing, Remick & Saul LLP represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed total assets of $53,883,888 and total
debts of $66,358,711.


PACIFIC LUMBER: May Continue to Use Cash Collateral Until June 1
----------------------------------------------------------------
Judge Richard S. Schmidt of the United States Bankruptcy Court for
the Southern District of Texas has authorized Pacific Lumber
Company and its debtor-affiliates to continue using cash
collateral through and including June 1, 2007.

The Debtors have not filed a revised budget with the Court as of
May 16, 2007.

As reported in the Troubled Company Reporter on May 3, 2007, the
Debtors are only permitted to use cash collateral for the
purposes enumerated in the budget.  The Debtors are not permitted
to use cash collateral for payment of professional fees,
disbursements, costs, or expenses incurred in connection with
asserting any claims or causes of action against the Lenders.

The Court has scheduled a hearing for May 31, 2007, to consider
the Debtors' continued use of cash collateral.

LaSalle Bank National Association and LaSalle Business Credit,
LLC, consents to the Debtors' limited use of cash collateral for
a limited period.

LaSalle informs the Court that it has entered into an agreement
to transfer its claims against the Debtors' estates to CanPartners
Investments IV LLC.

LaSalle also relates that it has been forced to initiate a
complaint against Marathon Structured Finance Fund L.P. to
complete the transfer of its claims due to Marathon's apparent
objection and unjustified failure to consent to the transfer of
LaSalle's debt.

Thus, LaSalle does not believe that any lengthy cash collateral
order should be entered, given that it likely will not be a party
to the Debtors' cases after the Court issues a ruling on the
Marathon Complaint.

LaSalle consents to the Debtors' use of cash collateral only
through June 1, 2007.

                       About Pacific Lumber

Headquartered in Oakland, California, The Pacific Lumber Company
-- http://www.palco.com/-- and its subsidiaries operate in
several principal areas of the forest products industry,
including the growing and harvesting of redwood and Douglas-fir
timber, the milling of logs into lumber and the manufacture of
lumber into a variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jeffrey L. Schaffer, Esq.,
William J. Lafferty, Esq., and Gary M. Kaplan, Esq., at Howard
Rice Nemerovski Canady Falk & Rabkin, A Professional Corporation
is Pacific Lumber's lead counsel.  Nathaniel Peter Holzer, Esq.,
Harlin C. Womble, Jr. , Esq., and Shelby A. Jordan, Esq., at
Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-
counsel.  Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at
Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead
counsel.  John F. Higgins, Esq., and James Matthew Vaughn, Esq.,
at Porter & Hedges LLP, is Scotia Pacific's co-counsel.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.  The Debtors' exclusive period to file a chapter
11 plan expires on Sept. 18, 2007, as extended.  The Debtors'
exclusive period to solicit acceptances of that plan expires on
Nov. 19, 2007.  (Scotia/Pacific Lumber Bankruptcy News, Issue No.
16, http://bankrupt.com/newsstand/or 215/945-7000).


PATIENT SAFETY: Squar, Milner Raises Going Concern Doubt
--------------------------------------------------------
Squar, Milner, Peterson, Miranda & Williamson, L.L.P., of San
Diego, Calif., expressed substantial doubt about Patient Safety
Technologies, Inc.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
Dec. 31, 2006.  The auditor noted that the company had recurring
losses from operations through Dec. 31, 2006, and significant
accumulated deficit and working capital deficit at Dec. 31, 2006.

The company posted a net loss of $13,623,152 on revenues of
$244,529 for the year ended Dec. 31, 2006, as compared with a net
loss of $5,907,523 on revenues of $562,374 in the prior year.

For the year ended Dec. 31, 2007, total operating expenses dropped
to $7,850,090 from $8,384,525 in the prior year.  The company
incurred $158,902 in cost of sales for the current year.

At Dec. 31, 2007, the company's balance sheet showed $11,181,446
in total assets, $9,638,092 in total liabilities, and $1,543,354
in stockholders' equity.  The company's accumulated deficit
increased to $29,483,910 at Dec. 31, 2007 from $15,784,108 in the
prior year.

A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1f7f

Based in Temecula, Calif., Patient Safety Technologies Inc. --
(OTC BB: PSTXE) -- http://www.patientsafetytechnologies.com/--  
provides capital and managerial assistance to development stage
companies in the medical products and health care solutions
industries primarily in the U.S. and Europe.  It develops Safety-
Sponge System, which reduces the number of retained sponges and
towels in patients during surgical procedures, and allows for
counting of surgical sponges that consist of a handheld scanner
and bar coded surgical dressings.  In addition, the company
involves in the real estate operations, including development and
sale of commercial properties, residential land development
projects, and other unimproved land.  It also offers express car
wash services and healthcare consulting services.


PAYLESS SHOESOURCE: $800MM Stride Rite Deal Cues S&P's Neg. Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'BB-' corporate credit rating, on specialty footwear retailer
Payless ShoeSource Inc. on CreditWatch with negative implications.  
This follows the announcement on May 22, 2007, that Payless signed
a definitive agreement to acquire Stride Rite Corp. for
approximately $800 million plus the assumption of debt.

Although Topeka, Kansas-based Payless intends to use about
$200 million of cash on hand, Standard & Poor's anticipates a
significant portion of the transaction is likely to be funded with
debt.  While S&P  expect the merger to have strategic benefits for
Payless as it pursues its house of brands strategy, the increased
leverage would result in a deterioration of credit protection
measures and a possible downgrade.  Standard & Poor's will
continue to monitor the rating as details of the transaction
become available.


PENINSULA GAMING: Credit Improvements Cue S&P's Positive Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Peninsula
Gaming LLC, including the 'B' corporate credit rating, on
CreditWatch with positive implications.
      
"The CreditWatch listing reflects meaningful improvements in the
company's credit measures over the past year," noted Standard &
Poor's credit analyst Ariel Silverberg.
     
While performance at Evangeline Downs continues to be affected by
an unfavorable comparison with the prior year and the Diamond Jo
Dubuque continues to face increased competition in its market,
overall company performance has been bolstered by the success of
the Diamond Jo Worth property that opened in April 2007.  In
addition, S&P have a favorable view of the upcoming Dubuque
expansion project, particularly as a large portion is expected to
be funded with excess cash.  As a result, EBITDA for the quarter
ended March 31, 2007 increased 12% over the prior-year period.  
Debt to EBITDA, adjusted for the present value of operating
leases, improved to 5.3x at March 31, 2007, from 6.6x in the
prior-year period.
     
In resolving the CreditWatch listing, S&P will evaluate
Peninsula's financial operating strategies and financial policy.


PERLAN THERAPEUTICS: Case Summary & 14 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Perlan Therapeutics, Inc.
        fka CFY Biomedicals
        12707 High Bluff Drive, Suite 200
        San Diego, CA 92130-2035

Bankruptcy Case No.: 07-02642

Type of Business: The Debtor is a biotechnology company.

Chapter 11 Petition Date: May 23, 2007

Court: Southern District of California (San Diego)

Debtor's Counsel: James P. Hill, Esq.
                  Sullivan, Hill, Lewin, Rez & Engel, A.P.L.C.
                  550 West Central Street, Suite 1500
                  San Diego, CA 92101
                  Tel: (619) 233-4100
                  Fax: (619) 231-4372

Total Assets:  $736,930

Total Debts: $2,462,265

Debtor's 14 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Pillsbury Winthrop                                     $194,764
P.O. Box 6000
San Francisco, CA 94160-2391

Nancy Ridge Tech. Center,                              $144,254
L.P.
Pacific Horizon Management
7920 Miramar Road, Suite 119
San Diego, CA 92126

George Montgomery                                       $14,321
107 West Santa Inez Avenue
Hillsborough, CA 94010

N.T.I. Breakwater                                        $9,130

Michelle Yelmene                                         $8,100

Shusaku Yamamoto                                         $5,981

S.D.G.&E.                                                $2,929

Charles River                                            $2,500
Laboratories

F.B. Rice & Co.                                          $1,191

Barry Toyonaga                                             $775

San Diego County Tax                                       $765
Collector

Smart & Biggar/                                            $739
Fetherstonhaugh

Susan J. Romano                                            $200

Douglas O. Haigh, Jr.                                       $44


PLANETOUT INC: Must Pay $15 Million Orix Loan by August 31
----------------------------------------------------------
PlanetOut Inc.'s lender Orix Venture Finance, LLC, waived defaults
associated with PlanetOut's failure to meet certain financial
tests and liquidity covenants.  In consideration of the waiver,
PlanetOut, in addition to other commitments, agreed to maintain
certain minimum cash balances, increase the interest rate on the
term loan to prime plus 5% and committed to raise at least
$15 million in new equity or subordinated debt, of which
$7 million must be raised by June 30, 2007 and the remainder by
Aug. 31, 2007.  

In September 2006, the company entered into a Loan and Security
Agreement with ORIX Venture Finance, LLC, which was amended in
February 2007 and May 2007.  Pursuant to the Loan Agreement, the
company borrowed $7,500,000 as a term loan and $3,000,000 as a
24-month revolving loan in September 2006.  The borrowings under
the line of credit are limited to the lesser of $3,000,000, which
the company has already drawn down, or 85% of qualifying accounts
receivable.  The term loan is payable in 48 consecutive monthly
installments of principal beginning on Nov. 1, 2006, together with
interest at a rate of prime plus 5%.

In connection with the term loan agreement, the company issued
Orix a 7-year warrant to purchase up to 120,000 shares of the
common stock of the Company at an exercise price of $3.74.  The
warrant vested immediately, had a fair value of approximately
$445,000 as of the date of issuance and will expire on September
28, 2013.  The value of the warrant was recorded as a discount of
the principal amount of the term loan and will be accreted and
recognized as additional interest expense using the effective
interest method over the life of the term loan.

The loans are secured by substantially all of the assets of the
company and all of the outstanding capital stock of all
subsidiaries of the company, except for the assets and capital
stock of SpecPub, Inc.

Based in San Francisco, California, PlanetOut Inc. (Nasdaq: LGBT)
-- http://www.planetoutinc.com/-- is a media and entertainment  
company exclusively serving the lesbian, gay, bisexual and
transgender community.  The company provides this audience a wide
variety of products and services including online and print media
properties, a travel marketing business and other goods and
services.  PlanetOut has additional offices in New York, Los
Angeles, Minneapolis, London and Buenos Aires.


PLANETOUT INC: Posts $6.8 Mil. Net Loss in Quarter Ended March 31
-----------------------------------------------------------------
PlanetOut Inc. reported its financial results for the first
quarter ended March 31, 2007.

Net loss for the first quarter of 2007 was $6.8 million, compared
with net loss of $132,000 for the same quarter a year ago.

Total revenue for the first quarter of 2007 was $16.8 million,
down 5% compared to $17.6 million for the same period one year
ago.

"We are taking some major steps to generate the healthy revenue
growth and solid earnings performance that we believe this company
is capable of producing," Karen Magee, chief executive officer,
PlanetOut Inc., said.  "To complete that work and regain the
confidence of the market will take time."

At March 31, 2007, the company's balance sheet showed total assets
of $88.8 million and total liabilities of $44.1 million, resulting
in a $44.6 million stockholders' equity.  At December 31, 2006,
equity was $51.1 million.

As of March 31, 2007, PlanetOut's accumulated deficit was
approximately $45.2 million.

Based in San Francisco, California, PlanetOut Inc. (Nasdaq: LGBT)
-- http://www.planetoutinc.com/-- is a media and entertainment  
company exclusively serving the lesbian, gay, bisexual and
transgender community.  The company provides this audience a wide
variety of products and services including online and print media
properties, a travel marketing business and other goods and
services.  PlanetOut has additional offices in New York, Los
Angeles, Minneapolis, London and Buenos Aires.


PLANETOUT INC: Seeking Strategic Alternatives to Raise Capital
--------------------------------------------------------------
PlanetOut Inc. has hired Allen & Co. to pursue strategic
alternatives including an equity sale and a cash loan.

According to a regulatory filing, the company has experienced
significant net losses and expects to continue to incur losses in
the future.  As of March 31, 2007, its accumulated deficit was
approximately $45.2 million.  Although the company had positive
net income in the year ended Dec. 31, 2005, it experienced a net
loss of $3.7 million for the year ended Dec. 31, 2006 and a net
loss of $6.9 million for the quarter ended March 31, 2007, and the
company may not be able to regain or sustain profitability in the
near future, causing its financial condition to suffer and its
stock price to decline.

Total revenue decreased primarily due to a reduction in online
subscribers to PlanetOut's Gay.com website and a decrease in sales
on its transaction-based websites.

Total operating costs increased primarily due to:

   * increases in cost of revenue for its February 2007
     Caribbean cruise aboard the Caribbean Princess, which was
     the largest capacity cruise ship chartered by RSVP to date,

   * increased marketing costs related to direct-mail campaigns
     for both its print properties and its RSVP travel
     itineraries,

   * severance charges related to the departure of its former
     President and Chief Operating Officer and our former Chief
     Technology Officer, and

   * additional costs related to the further integration of its
     businesses.

Pursuant to its May 2007 amendment of the Loan Agreement with Orix
Venture Finance, LLC, PlanetOut is also obligated to raise at
least $15 million in new equity or subordinated debt, of which
$7 million must be raised by June 30, 2007 and the remainder by
Aug. 31, 2007.

Based on the rules of the Nasdaq Stock Market applicable to the
company, PlanetOut is limited in its ability to issue new equity
or convertible debt in excess of 19.9% of its outstanding shares
of common stock without stockholder approval, if that issuance is
at a discount.

Accordingly, depending on the market value of PlanetOut's common
stock and other factors, it may be difficult for the company to
meet the capital-raising obligation contained in its May 2007
amendment of the Loan Agreement.  Without additional financing,
the company expects that its available funds and anticipated cash
flows from operations will be sufficient to meet its expected
needs for working capital and capital expenditures through the
middle of third quarter 2007.

The company is not certain that it will be able to obtain
additional financing on commercially reasonable terms or at all.  
If PlanetOut raises additional funds through the issuance of
equity, equity-related or debt securities, these securities may
have rights, preferences or privileges senior to those of the
rights of its common stock, and its stockholders will experience
dilution of their ownership interests.

If it is not successful in securing additional funding or in
implementing strategic alternatives in the near term, PlanetOut
will be in default under the Loan Agreement, which will permit
Orix to accelerate its obligations under the loans and foreclose
on the assets securing the loans.  As an additional result of such
a default, borrowings under other debt instruments that contain
cross-acceleration or cross-default provisions may also be
accelerated and become due and payable.

The company may be forced to reduce its planned operations and
development activities, restructure its businesses and take other
steps to minimize or eliminate expenses.

Based in San Francisco, California, PlanetOut Inc. (Nasdaq: LGBT)
-- http://www.planetoutinc.com/-- is a media and entertainment  
company exclusively serving the lesbian, gay, bisexual and
transgender community.  The company provides this audience a wide
variety of products and services including online and print media
properties, a travel marketing business and other goods and
services.  PlanetOut has additional offices in New York, Los
Angeles, Minneapolis, London and Buenos Aires.


PORTRAIT CORP: Court Sets June 4 Hearing on Purchase Deal with CPI
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on June 4, 2007,at 11:00 a.m., to consider
approval of an agreement among Portrait Corporation of America
Inc., its debtor-affiliates and Consumer Programs Incorporated.

Under the agreement, CPI will acquire substantially all of the
Debtors' operating assets for $100 million in cash, subject to
certain closing adjustments, and the assumption of certain
liabilities.

The transaction is expected to close by the end of June 2007.

Objections to the sale agreement are due on May 29, 2007.

For more information on the sale or for copies of the purchase
agreement contact counsel for the Debtors:

   Kasowitz, Benson, Torres and Friedman LLP
   No. 1633 Broadway
   New York, NY 10019
   Tel.: (212) 506-1700

                          About CPI Corp.

CPI Corp. (NYSE: CPY) is a portrait photography company offering
photography services in the United States, Puerto Rico and Canada
through Sears Portrait Studios.  The Company also operates
http://searsphotos.com/-- the vehicle for the Company's customers   
to archive, share portraits via email and order additional
portraits and products.

                       About Portrait Corp.

Portrait Corporation of America Inc. -- http://pcaintl.com/--     
provides professional portrait photography products and services
in North America.  The Company operates portrait studios within
Wal-Mart stores and Supercenters in the United States, Canada,
Mexico, Germany, and the United Kingdom.  The company also
operates a modular traveling business providing portrait
photography services in additional retail locations and to church
congregations and other institutions.

Portrait Corporation and its debtor-affiliates filed for Chapter
11 protection on Aug. 31, 2006 (Bankr S.D. N.Y. Case No.
06-22541).  John H. Bae, Esq., at Cadwalader Wickersham & Taft
LLP, represents the Debtors in their restructuring efforts.
Berenson & Company LLC serves as the Debtors' Financial Advisor
and Investment Banker.  Kristopher M. Hansen, Esq., at Stroock &
Stroock & Lavan LLP represents the Official Committee of Unsecured
Creditors.  Peter J. Solomon Company serves as financial advisor
for the Committee.  At June 30, 2006, the Debtor had total assets
of $153,205,000 and liabilities of $372,124,000.


RESIDENTIAL ACCREDIT: Fitch Junks Rating on Class B-2 S2001-QS18
----------------------------------------------------------------
Fitch Ratings has taken action on these Residential Accredit Loan,
Inc. mortgage-pass through certificates:

  Series 2001-QS18

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AAA';
     -- Class M-2 upgraded to 'AA+' from 'AA';
     -- Class M-3 upgraded to 'A' from 'BBB';
     -- Class B-1 affirmed at 'BB';
     -- Class B-2 downgraded to 'CCC' from 'B' and assigned a
        distressed recovery (DR) rating of 'DR2'.

  Series 2003-QS5

     -- Class A affirmed at 'AAA'
     -- Class M-1 affirmed at 'AA+';
     -- Class M-2 affirmed at 'A+';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 affirmed at 'BB';
     -- Class B-2 downgraded to 'CCC' from 'B' and assigned a DR
        rating of 'DR2'.

  Series 2005-QS4

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 downgraded to 'B+' from 'BB';
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR4'.

  Series 2005-QS8

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 affirmed at 'BB';
     -- Class B-2 affirmed at 'B'.

  Series 2005-QS14 Group I

     -- Class IA affirmed at 'AAA';
     -- Class IM-1 affirmed at 'AA';
     -- Class IM-2 affirmed at 'A';
     -- Class IM-3 affirmed at 'BBB';
     -- Class IB-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class IB-2 downgraded to 'CC' from 'B' and assigned a DR
        rating of 'DR3'.

  Series 2005-QS14 Group II

     -- Class IIA affirmed at 'AAA';

  Series 2005-QS15

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 is rated 'B' and placed on Rating Watch
        Negative.

  Series 2005-QS16

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 is rated 'B' and placed on Rating Watch
        Negative.

  Series 2006-QS1

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS2 Group I

     -- Class IA affirmed at 'AAA';
     -- Class IM-1 affirmed at 'AA';
     -- Class IM-2 affirmed at 'A';
     -- Class IM-3 affirmed at 'BBB';
     -- Class IB-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class IB-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS2 Group II

     -- Class IIA affirmed at 'AAA';
     -- Class IIM-1 affirmed at 'AA';
     -- Class IIM-2 affirmed at 'A';
     -- Class IIM-3 affirmed at 'BBB';
     -- Class IIB-1 affirmed at 'BB';
     -- Class IIB-2 affirmed at 'B'.

  Series 2006-QS3

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 is rated 'BBB' and placed on Rating Watch
        Negative;
     -- Class B-1 downgraded to 'BB-' from 'BB';
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS4

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 is rated 'BBB' and placed on Rating Watch
        Negative;
     -- Class B-1 downgraded to 'BB-' from 'BB';
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS5

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS6 Group I

     -- Class IA affirmed at 'AAA';
     -- Class IM-1 affirmed at 'AA';
     -- Class IM-2 affirmed at 'A';
     -- Class IM-3 affirmed at 'BBB';
     -- Class IB-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class IB-2 is rated 'B' and placed on Rating Watch
        Negative.

  Series 2006-QS6 Group II

     -- Class IIA affirmed at 'AAA';
     -- Class IIM-1 affirmed at 'AA';
     -- Class IIM-2 affirmed at 'A';
     -- Class IIM-3 affirmed at 'BBB';
     -- Class IIB-1 affirmed at 'BB';
     -- Class IIB-2 affirmed at 'B'.

  Series 2006-QS7

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS8

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 is rated 'BB' and placed on Rating Watch
        Negative;
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

  Series 2006-QS9

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 is rated 'BBB' and placed on Rating Watch
        Negative;
     -- Class B-1 downgraded to 'B+' from 'BB';
     -- Class B-2 downgraded to 'C' from 'B' and assigned a DR
        rating of 'DR5'.

The affirmations, affecting approximately $6.7 billion of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss.  The upgrades, affecting
approximately $4.1 million of the outstanding certificates,
reflect an improving relationship between CE and expected loss.  
The downgrades, affecting approximately $36.1 million, reflect a
deteriorating relationship between CE and expected losses.  The
Rating Watch Negative affects approximately $41.3 million of the
outstanding certificates.

The negative rating actions on the 2005 and 2006 vintage RALI
transactions are because of current trends in the relationship
between serious delinquency and credit enhancement.  The 90+ DQ
(including loans in bankruptcy, foreclosure, and REO) for
transactions with negative rating actions ranges from 0.79%
(series 2005-QS14 Pool 1) to 3.58% (series 2006-QS3) of the
current collateral balance.

Series 2001-QS18, class B-2 is downgraded because of high
delinquencies and losses.  To date, the transaction has
experienced losses of approximately $1.2 million or 0.33% of the
original collateral balance. The 90+ DQ (including loans in
bankruptcy, foreclosure, and REO) is 4.86% of the current
collateral balance, while the current CE for the B-2 bond is
0.50%.

Series 2003-QS5, class B-2 is also downgraded because of high
delinquencies and losses.  The 90+ DQ (including loans in
bankruptcy, foreclosure, and REO) is 0.58% of the current
collateral balance.  To date, the transaction has experienced
losses of approximately $223,000 or 0.09% of the original
collateral balance.  Losses have deteriorated the CE for the B-2
bond from 0.15% at issuance to 0.12% currently.

The collateral of the above transactions primarily consists of 30-
year and 15-year fixed-rate mortgage loans extended to Alt-A
borrowers.  The loans are primarily secured by first liens on one-
to four-family residential properties.  All of the above
transactions are master serviced by GMAC-RFC, (rated 'RMS1' by
Fitch).

As of the April 2007 distribution date, the pool factors (current
principal balance as a percentage of original) of the above
transactions range from 7% (series 2001-QS18) to 86% (series 2006-
QS8 & 2006-QS9).  The seasoning ranges from 9 months (series 2006-
QS8 & 2006-QS9) to 64 months (series 2001-QS18).


RESIDENTIAL ASSET: Fitch Affirms Low B Ratings on Two Classes
-------------------------------------------------------------
Fitch Ratings has upgraded and affirmed the following classes of
Residential Asset Mortgage Products, Inc. 2002-SL1:

  RAMP Series 2002-SL1 Group 1:

     -- Classes A-I-3, A-I-IO affirmed at 'AAA'.

  RAMP Series 2002-SL1 Group 2:

     -- Classes A-II-1 to A-II-4 affirmed at 'AAA';
     -- Class M-II-1 affirmed at 'AA+';
     -- Class M-II-2 upgraded to 'AA-' from 'A+';
     -- Class M-II-3 upgraded to 'A-' from 'BBB';
     -- Class B-II-1 affirmed at 'BB';
     -- Class B-II-2 affirmed at 'B'.

The upgrades reflect an improved relationship between credit
enhancement and expected future loses and affect approximately
$454,819 in outstanding certificates, as of the April 2007
distribution date.  The affirmations reflect a satisfactory
relationship between CE and future loss expectations and affect
approximately $26 million in outstanding certificates.

The collateral in the 2002-SL1 series consists of seasoned fixed-
rate and adjustable-rate mortgage loans secured by first liens on
one- to four-family residential properties. Residential Funding
Company, LLC (currently rated 'RMS1' by Fitch) is the master
servicer for these loans.

As of the April 2007 distribution date, the pool factors (current
principal balance as a percentage of original balance) for group 1
& group 2 are 6.89% and 23.36%, respectively.  The upgraded
classes benefit from credit enhancement (in the form of
subordination) over three times the original levels.


ROADHOUSE GRILL: Rachlin Cohen Raises Going Concern Doubt
---------------------------------------------------------
Rachlin Cohen & Holtz, L.L.P., of Fort Lauderdale, Florida,
expressed substantial doubt about Roadhouse Grill, Inc.'s ability
to continue as a going concern after auditing the company's
financial statements for the year ended April 30, 2006.  The
auditing firm said "the Company has suffered recurring net losses
and has also experienced cash flow constraints which have resulted
in the Company being delinquent in certain payments to creditors,
including taxing authorities."

The company posted a net loss of $10,721,000 on revenues of
$115,995,000 for the year ended April 30, 2006, as compared with a
net loss of $2,441,000 on revenues of $120,773,000 for the year
ended April 24, 2005.

Total cost of restaurant sales dropped to $109,803,000 for the
year ended April 30, 2006, from $111,148,000 in the prior year.  
Food and beverage expenses dropped to $38,976,000 for the year
ended April 30, 2006, from $42,758,000 in the prior year.  Labor
and benefits expenses increased to $39,816,000 for the year ended
April 30, 2006, from $38,213,000 in the prior year.  Occupancy and
other expenses grew to $31,011,000 for the year ended April 30,
2006, from $30,177,000 in the prior year.

The company's total operating expenses dropped to $123,592,000 for
the year ended April 30, 2006, from $125,399,000 in the prior
year.

At April 30, 2006, the Company's balance sheet showed $25,108,000
in total assets and $33,406,000 in total liabilities, resulting to
$8,298,000 in stockholders' deficit.  In comparison to the prior
year, the company had stockholders' equity of $2,386,000 from
$31,714,000 in total assets and $29,328,000 in total liabilities.

The company's April 30, 2006 balance sheet also showed negative
working capital of $22,607,000 from $2,511,000 in total current
assets and $25,188,000 in total current liabilities.

                              Default

In August 2005, the company entered into a loan agreement with its
principal shareholder under which they initially borrowed
$1.25 million.  In October 2005, they entered into an amended and
restated loan agreement with their principal shareholder under
which they borrowed an additional $2.0 million.  In each of March
and May 2006, the loan agreement was further amended, thereby
allowing them to borrow, in the aggregate, an additional
$1.6 million.  The loan was further increased in July 2006 to its
current borrowing level.  The loan is currently in default.  The
company owe their majority shareholder about $8.1 million,
including accrued but unpaid interest.

                           Loan from CEO

Chief Executive Officer Ayman Sabi loaned the company $120,000 in
September 2005, and an additional $100,000 in May 2006, the money
were used for working capital.

                       Impact of Hurricanes

The company suffered varying degrees of damage from Hurricane
Katrina that hit South Florida on August 24-25, 2005, and in the
Southeast Gulf Coast region on August 29, 2005.  All of the
company's South Florida restaurants suffered minor damages and
were temporarily closed, and its restaurant in Biloxi, Mississippi
was destroyed.  All of the company's restaurants in Gulf Coast
regions have now reopened.

Thirteen of the company's South Florida restaurants were
temporarily closed when Hurricane Wilma hit the region on October
24, 2005.  In addition, the company's corporate office was closed
for an eight-day period.  The company filed insurance claims with
respect to their losses, including claims for business
interruption.  In the aggregate, as of April 30, 2006, the company
received $0.3 million in proceeds as full settlement on their
Hurricane Wilma insurance claim, which has been recorded as an
offset to the loss on the carrying value of the assets impacted by
the hurricane.

A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1f94

                      About Roadhouse Grill

Based in Pompano Beach, Florida, Roadhouse Grill, Inc. -- (Other
OTC: GRLL) -- http://www.roadhousegrill.com/-- operates,  
franchises, and licenses casual dining restaurants under the name
of Roadhouse Grill in the U.S.  As of February 1, 2006, the
company owned 60 Roadhouse Grill restaurants located in Florida,
Alabama, Arkansas, Georgia, Louisiana, Mississippi, New York,
North Carolina, Ohio, and South Carolina.  As of the above date,
Roadhouse Grill had 12 franchised or licensed restaurants.
Roadhouse Grill, Inc., operates as a subsidiary of Berjaya Group
(Cayman) Ltd.


RURAL CELLULAR: Moody's Junks Rating on $115.5 Million Note Issue
-----------------------------------------------------------------
Moody's Investors Service confirmed all ratings of Rural Cellular
Corporation, including the company's B3 corporate family rating,
reflecting Moody's belief that the company is likely to continue
its very recent trend of net subscriber additions and cost
reductions through the next couple of years, while maintaining
sufficient liquidity.

At the same time, Moody's assigned a Caa2 rating to the company's
new senior subordinated notes issue and withdrew the rating on
Rural's senior exchangeable preferred shares, which were exchanged
on May 15, 2007 into senior subordinated debentures that the
company is now refinancing.  The ratings reflect a B3 probability
of default and loss-given-default assessments.  The outlook for
all ratings is negative.

Ratings Confirmed:

   -- Corporate family rating B3;

   -- Probability of default rating B3;

   -- $60 million senior secured bank facility due 2010 Ba3,
      LGD1, 0%;

   -- $510 million 8.25% senior secured notes due 2012 Ba3,
      LGD2, 15% (from LGD2, 18%);

   -- $325 million 9.875% senior unsecured notes due 2010 B3
      LGD4, 52% (from LGD4, 57%);

   -- $300 million 9.75% senior subordinate notes due 2010 Caa2,
      LGD5, 84% (from LGD5, 86%);

   -- $175 million senior subordinate FRN's due 2012 Caa2,
      LGD5, 84% (from LGD5, 86%);

   -- 12.25% junior exchangeable preferred shares due 2011 Caa2,
      LGD6, 99% (from LGD6, 100%).

Ratings Assigned:

   -- $115.5 million senior subordinate FRN's Caa2, LGD5, 84%

Ratings Withdrawn

   -- 11.375% senior exchangeable preferred shares due 2010
      Caa2, LGD6, 98%

As Rural has transitioned its network away from TDMA towards GSM
and CDMA through much of the past three years, subscriber churn
has remained elevated, resulting in net subscriber losses despite
strong industry growth.  In addition, reduced scale benefits and
handset migration costs have negatively impacted margins while
Rural's relatively high-cost capital structure has inhibited the
company from improving key credit metrics, even as free cash flow,
for the most part, has remained positive.  We believe it is likely
that the negative influences of this transition are now largely
behind Rural given roughly 86% of its subscribers use either GSM
or CDMA technologies and subscriber churn has improved to under 2%
in the company's most recent quarter.  We expect favorable
industry conditions may enable the company's positive momentum to
continue through the next couple of years, and that Rural may
generate modest EBITDA growth and sustainable free cash flow,
reducing its adjusted leverage towards 7.5x by the end of 2008, in
our opinion.

Rural's exchange of its senior preferred shares with accruing
dividends into lower coupon senior subordinated notes will result
in a modest increase in cash interest costs.  However the exchange
removes a key covenant restriction, which has prohibited Rural
from pursuing debt refinancing initiatives. Following the
exchange, we believe Rural has a sufficient liquidity position,
which may provide the company with an adequate amount of time to
address some its debt refinancing requirements before 2010, when
debt maturities become significant.

The negative outlook reflects Moody's view that several of Rural's
key credit metrics are weak for the B3 rating category and
execution risks to sustained subscriber growth remain, given the
short period of progress relative to the longer term challenges
evident throughout much of the past three years.

Based in Alexandria, Minnesota, Rural Cellular Corporation
provides wireless telecommunication services to approximately 640
thousand retail subscribers in rural areas of the United States.


RURAL CELLULAR: Operation Improvements Cue S&P's Stable Outlook
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Alexandria, Minnesota-based Rural Cellular Corp. to stable from
negative.
      
"The outlook revision reflects recent improvement in operating
trends following a challenging network transition period," said
Standard & Poor's credit analyst Susan Madison.  In addition, S&P
note that the recent exchange of the company's outstanding senior
preferred stock has eliminated onerous indenture requirements that
had significantly increased refinancing costs.
     
Simultaneously, S&P assigned a 'CCC' rating to Rural Cellular's
proposed $115.5 million senior subordinated floating-rate notes
due 2014.  Proceeds from the new notes will be used to refinance
the company's 11.375% exchange debentures.  The notes will be
issued under Rule 144A with registration rights.  Debt and
preferred stock outstanding at March 31, 2007, pro forma for the
pending transaction, totaled about $1.9 billion.  All existing
ratings, including the 'B-' corporate credit rating, are affirmed.
     
The improvement in Rural Cellular's operating performance has been
driven by success in migrating subscribers to the company's
upgraded Global System for Communications and Code Division
Multiple Access networks in the past year.
     
The ratings on Rural Cellular reflect the company's vulnerable
position as a regional wireless provider competing against both
national wireless carriers and entrenched regional cellular
carriers; its reliance on roaming revenues, which are subject to
pricing pressure; and a highly leveraged financial profile.  
Progress in transitioning its subscriber base to its upgraded
wireless network over the last year and adequate liquidity are
tempering factors.  Rural Cellular provides primarily regional
wireless service plans to about 720,000 subscribers in 15 states.


SAKS INCORPORATED: 2007 1st Quarter Earnings Lowers to $11 Million
------------------------------------------------------------------
Saks Incorporated recorded net income of $11 million on net sales
of $792.7 million for the first quarter ended May 5, 2007, as
compared with a net income of $77.9 million on net sales of
$684.1 million for the first quarter ended April 29, 2006.  The
first quarter included the following after-tax items:

     -- expenses of about $13.5 million for retention, severance,
and transition costs as the company downsizes following the
disposition of its SDSG businesses;

     -- expenses of about $1 million, associated with the
previously disclosed ongoing investigations by the Securities and
Exchange Commission and the Office of the U.S. Attorney for the
Southern District of New York; and

     -- a loss on extinguishment of debt totaling $3.1 million,
related to the repurchase of $95.9 million of senior notes.

The company sold its Saks Department Store Group businesses in
2005 and 2006, and the sold SDSG businesses are presented as
"discontinued operations" in the prior year period.  Saks Fifth
Avenue and Club Libby Lu are reflected in the company's continuing
operations.

As of May 5, 2007, the company listed total assets valued at
$2.4 billion, total liabilities of $1.3 billion, and total
stockholders' equity of $1.1 billion.

Steve Sadove, chairman and chief executive officer of the company,
noted, "We are pleased with the substantial improvement in
operating income for the first quarter which primarily was driven
by strong comparable store sales growth and solid expense
management.  Our first quarter gross margin rate also improved
slightly over last year's strong gross margin rate."

"Our first quarter comparable store sales increase of 14.4%
indicates that we have made significant progress in refining and
strengthening our merchandise assortments by store and that our
selling culture and marketing efforts continue to improve."

Mr. Sadove continued, "The trends in the number of transactions
and the average dollars per transaction improved for the first
quarter, and we experienced growth in nearly all merchandise
categories. Sales performance was solid across all geographies.  
Our New York City flagship location once again generated a strong
performance, as did most of our other flagship locations.  We also
experienced strength in several of our secondary market stores
where we have intensified our focus and substantially enhanced the
merchandise assortments.  The Saks Direct business posted a sales
increase of approximately 50% over last year's first quarter, and
we experienced modest sales growth at Off 5th."

Mr. Sadove also noted, "I am very pleased with the progress we
have made and continue to make on streamlining our organizational
structure and right-sizing our organization.  The company
initiated its downsizing in 2006 resulting from the sale of the
SDSG businesses and as our associated transition service
agreements began to be phased out.  We are substantially complete
with the reduction in force, and we expect to finalize the
integration and consolidation process by the end of the second
quarter.  We will continue to work to identify sufficient expense
reductions to create a competitive, cost-effective infrastructure
and to drive additional leverage over time; however, for the
balance of 2007, we do not expect to achieve the same degree of
SG&A expense leverage that we delivered over the past three
quarters as we anniversary the significant leverage that began
last year."

               Quarter-End Balance Sheet Highlights

Consolidated inventories at May 5, 2007, totaled $811.6 million,
an approximate 5% decrease from the prior year.  The total
decrease reflects the disposition of Parisian-related inventories
offset by planned increased inventories at SFA.  Consolidated
comparable store inventories increased about 19% over last year,
attributable to a planned increase at SFA.

Mr. Sadove noted, "Our quarter-end inventory levels reflect a
targeted inventory reinvestment strategy that is leading to
increased sales productivity.  These investments were based upon a
detailed planning process for our entire store base and a
comprehensive review of benchmark and competitive data.

"Of the incremental inventory investment, approximately 40%
relates to replenishment or continuative product, which we believe
has minimal markdown risk.  The balance of the increase is
attributable to two primary areas. First, we have made strategic
investments in key items and vendor intensifications in such high-
potential areas as footwear, handbags, and men's.  In the
aggregate, we believe these investments bring low-to-moderate
risk.  Secondly, we have invested in certain core designer ready-
to-wear brands that we believe carry normalized risk.  We are
experiencing above-average growth in all of these areas of the
business."

The company expects that the inventory levels will reflect these
initiatives through mid-2007 and be in-line with sales growth by
fiscal year end.

The company ended the quarter with about $158 million of cash on
hand.  At quarter end, the company had no direct outstanding
borrowings on its $500 million revolving credit facility.  Funded
debt at May 5, 2007, totaled about $587 million, and debt-to-
capitalization was 33.9%.  The cash on hand and funded debt
balances reflect the first quarter repurchase of $95.9 million of
senior notes.

The company has remaining availability of about 37.4 million
shares under its existing repurchase authorization programs.  The
company did not repurchase any shares of common stock during the
quarter.

Kevin Wills, executive vice president and chief financial officer,
commented, "We believe that our invested cash, our improving cash
flows, and the unfunded liquidity in our revolving credit facility
will provide flexibility for potential additional strengthening of
our balance sheet, further investments in our business, and
potential additional purchases of common stock.  We still believe
it is appropriate to target ongoing financial leverage with a
Funded Debt/EBITDA ratio of less than 2.5x."

                   Outlook for 2007 and Beyond

Mr. Sadove commented, "I continue to be optimistic about the long-
term potential of the luxury sector and the Saks Fifth Avenue
business.  I am exceptionally pleased with the level of
excitement, collaboration, and teamwork throughout our entire
organization.  I remain confident that an 8% operating margin is
attainable within the next three years or so, and we are very
pleased with the progress we are making toward that goal."

The company estimates that annual capital expenditures will total
about $125 million to $150 million, which will include store
renovations, maintenance capital, and ongoing information
technology and logistics improvements.

                     About Saks Incorporated

Based in Birmingham, Alabama, Saks Incorporated (NYSE: SKS) --
http://www.saksincorporated.com/-- operates Saks Fifth Avenue   
Enterprises, which consists of 55 Saks Fifth Avenue stores, 50
Saks Off 5th stores, and Saks.com.  The company also operates 39
Parisian stores and 57 Club Libby Lu specialty stores.

                          *     *     *

Saks Incorporated carries Moody's B2 long-term corporate family
and probability-of-default ratings and B3 senior unsecured debt
rating.  The company carries Standard & Poor's B+ long-term
foreign and local issuer credit ratings.  It also has Fitch's B+
long-term issuer default rating, BB bank loan debt rating, and B
senior unsecured debt rating.  Fitch gave the company a negative
ratings outlook.


SALISBURY BY THE SEA: Case Summary & Five Largest Unsec. Creditors
------------------------------------------------------------------
Debtor: Salisbury By The Sea Investments, L.L.C.
        29 Railroad Avenue, Suite 3
        Salisbury, MA 01952

Bankruptcy Case No.: 07-13235

Type of Business: The Debtor is engaged in the real estate
                  business.

Chapter 11 Petition Date: May 23, 2007

Court: District of Massachusetts (Boston)

Judge: Joan N. Feeney

Debtor's Counsel: Thomas J. Raftery, Esq.
                  P.O. Box 550
                  Carlisle, MA 01741-0550
                  Tel: (978) 369-4404
                  Fax: (978) 369-7816

Estimated Assets: $1 Million to $100 Million

Estimated Debts: $1 Million to $100 Million

Debtor's Five Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Newburyport Five Cent Savings    2 Broadway          $1,500,000
Bank                             Salisbury, MA;
63 State Street                  value of
Newburyport, MA 01950            security:
                                 $1,800,000;
                                 value of senior
                                 lien: $1,422,000

Norman Pelletier                 obligation under      $750,000
14 Broadway                      purchase and sale
Salisbury, MA 01952              agreement

G.S.D. Associates                services rendered      $40,000
148 Main Street
North Andover, MA 01845

Dahl Group                       services rendered      $30,000

Shaheen Enterprises              obligation under       unknown
                                 purchase and sale
                                 agreement to
                                 provide one unit
                                 in eventual
                                 development


SI INTERNATIONAL: Inks Pact to Buy LOGTEC Inc.'s Stake for $59MM
----------------------------------------------------------------
SI International Inc. has entered into a definitive agreement to
acquire LOGTEC Inc.'s outstanding capital stock for $59 million in
cash.  

SI International expects to pay the purchase price with cash-on-
hand and additional borrowings under its senior credit facility.
SI International expects the proposed acquisition will be
accretive to earnings immediately.

The acquisition of LOGTEC will strengthen SI International's
relationships with several key Department of Defense organizations
including the Air Force Materiel Command at Wright Patterson Air
Force Base, Ohio.  Additionally, the acquisition would strengthen
SI International's service offerings in the area of logistics.

SI International and LOGTEC plan to complete the transaction
within the second quarter of 2007.

"The acquisition of LOGTEC would allow SI International to broaden
its client base and enhance our portfolio of Rapid Response -
Rapid Deployment(R) service offerings particularly in the emerging
area of logistics," Brad Antle, president and ceo of SI
International, said.  "With LOGTEC joining the company's team, it
would greatly enhance the company's logistics capabilities with
aging aircraft strategies, materiel management systems, depot
maintenance systems, base maintenance systems, depot supply
systems, and contingency, operational and acquisition logistics.
The company believes that LOGTEC's client base, such as the Air
Force Materiel Command, is aligned with some of the higher
priority areas within the Department of Defense.  Additionally,
the company believes this acquisition would provide meaningful
cross-selling possibilities to support its organic growth."
    
"LOGTEC believes that becoming a part of SI International will
generate many immediate and long-term benefits to LOGTEC's
customers and employees," John Nowak, LOGTEC ceo, commented.  "The
company's employees' devotion to their customers has fueled
tremendous success throughout LOGTEC's history.  To provide
LOGTEC's clients even greater value, and to offer its employees
additional opportunities for personal and professional growth, it
makes sense to join a company with SI International's scope,
scale, and strong rapid response, rapid deployment track record
and reputation in the Federal IT sector."
    
The consummation of the acquisition is subject to the satisfaction
of a number of customary conditions precedent, including SI
International obtaining approval under its senior credit facility
to increase the size of its credit facility and consummate the
acquisition.  There can be no assurances that the acquisition will
be consummated.  SI International has successfully acquired and
integrated eight businesses since 1999.

                         About LOGTEC Inc.

Headquartered in Fairborn, Ohio, LOGTEC Inc. is a privately held
company that provides logistics, acquisition, and information
technology support, primarily to the Federal government in areas
such as acquisition and program management, systems and network
engineering and integration, software and web-based application
development, data management and warehousing, information
assurance, and training.  LOGTEC's largest clients include Air
Force Materiel Command and Naval Air Systems Command.  LOGTEC has
approximately 350 employees with over 50% holding security
clearances.  For the twelve months ended Dec. 31, 2006, LOGTEC had
unaudited revenues of approximately $54 million.

For the twelve months ended Dec. 31, 2006, LOGTEC generated
approximately 99% of its revenue from work performed for the
federal government.  LOGTEC generated approximately 83% of
revenues from contracts with the United States Air Force, with the
approximately remaining 16% of revenues from other DoD agencies.
LOGTEC generated 72% of fiscal year 2006 revenues as a prime
contractor.
    
                      About SI International

Headquartered in Reston, Virginia, SI International Inc. (Nasdaq:
SINT) -- http://www.si-intl.com/-- is a provider of information  
technology and network solutions to the federal government.  The
company is a member of the Russell 2000 index, has revenues of
$462 million for the twelve months ended Dec. 30, 2006.

                          *     *     *

As reported in the Troubled Company Reporter on April 16, 2007,
Moody's Investors Service affirmed these credit ratings of SI
International Inc.: (i) $60 million senior secured first lien
revolver due 2010 at Ba3 (LGD 2, 24%); (ii)$70.4 million senior
secured term loan facility due 2011 at Ba3 (LGD 2, 24%); (iii)
corporate family rating at B1; (iv) probability of default rating
at B2; and (v) speculative grade liquidity rating of SGL-1.  The
rating outlook remains positive.


SIRIUS SATELLITE: Antitrust Chairman Balks at XM-Sirius Merger
--------------------------------------------------------------
U.S. Senator Herb Kohl, chairman of the Senate antitrust
subcommittee, is pushing for the rejection of $41 billion merger
deal of XM Satellite Holdings Inc. and Sirius Satellite Radio Inc,
according to various reports.

As reported in the Troubled Company Reporter on Feb. 22, 2007,
SIRIUS and XM Satellite Radio disclosed a definitive agreement
under which the companies will be combined in a tax-free, all-
stock merger of equals.  XM stockholders will receive 4.6 shares
of SIRIUS common stock for each share of XM they own.  XM and
SIRIUS stockholders will each own approximately 50% of the
combined company.

The transaction is subject to approval by both companies'
stockholders, the satisfaction of customary closing conditions and
regulatory review and approvals, including antitrust agencies and
the FCC.  The companies expect the transaction to be completed by
the end of 2007.

According to a letter Mr. Kohl wrote, he implored the Justice
Department and the Federal Communications Commission to consider
scraping out the proposed $4 billion buyout of XM by Sirius,
insisting that the transaction is contrary to antitrust law and
not in the public interest.

Various sources relate that Mr. Kohl further recounted that the
merger aims to monopolize the satellite radio market and the audio
entertainment market, which are distinct from each other.

The National Association of Broadcasters, the lobby group
representing radio and television programmers, supports Mr. Kohl's
views, Corey Boles of MarketWatch writes.

                        About XM Satellite

Headquartered in Washington, D.C., XM Satellite Radio Holdings
Inc. -- http://www.xmradio.com/-- parent of XM Satellite Radio  
Inc. (Nasdaq:XMSR), is a satellite radio broadcaster.

                   About SIRIUS Satellite Radio

Based in New York, SIRIUS Satellite Radio Inc. (NASDAQ: SIRI) --
http://www.sirius.com/ -- provides sports radio programming,  
broadcasting play-by-play action of more than 350 pro and college
teams.  SIRIUS features news, talk and play-by-play action from
the NFL, NASCAR, NBA, NHL, Barclays English Premier League soccer,
UEFA Champions League, the Wimbledon Championships and more than
125 colleges, plus live coverage of several of the year's top
thoroughbred horse races.  SIRIUS also features programming from
ESPN Radio and ESPNews.

At March 31, 2007, the company's balance sheet showed
$1.51 billion in total assets and $1.93 billion in total
liabilities, resulting in a $421.9 million total stockholders'
deficit.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 22, 2007
Standard & Poor's Ratings Services placed all its ratings,
including the 'CCC' corporate credit rating, on Sirius Satellite
Radio Inc. on CreditWatch with positive implications, following
the company's definitive agreement to an all-stock "merger of
equals" with XM Satellite Radio Holdings Inc.

Moody's Investors Service affirmed the existing debt ratings of
SIRIUS Satellite Radio, Inc., including Caa1 corporate family
rating, B3 probability-of-default rating and Caa1 rating of 9-5/8%
senior notes due 2013.


SOLERA HOLDINGS: Closes IPO of $26 Million Shares of Common Stock
-----------------------------------------------------------------
Solera Holdings Inc. has completed its initial public offering of
26,250,000 shares of its common stock priced at $16 per share, of
which 19,200,000 were offered by Solera and 7,050,000 were offered
by selling stockholders.

Solera also disclosed that the underwriters of its initial public
offering exercised in full their option to purchase from selling
stockholders an additional 3,937,500 common shares at the public
offering price of $16 per share.  Additional 3,937,500 shares were
sold.

Goldman Sachs & Co. and JP Morgan Securities Inc. were joint book-
runners for this transaction.  Citigroup Global Markets Inc.,
Deutsche Bank Securities Inc. and Lehman Brothers Inc. acted as
co-managers.

                      About Solera Holdings

Solera Holdings, Inc. -- http://www.solerainc.com/-- is a global  
provider of software and services to the automobile insurance
claims processing industry.  Solera has operations in 45 countries
across 5 continents.  The Solera companies include Audatex
Holdings in the United States, Canada, and in more than 40
additional countries, Informex in Belgium, Sidexa in France, ABZ
in The Netherlands, Hollander serving the North American recycling
market, and IMS providing medical review services.

                          *     *     *

As reported in the Troubled Company Reporter on May 22, 2007,
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit and senior secured debt ratings on Solera Holdings.

At the same time, Standard & Poor's revised its outlook on Solera
to positive from negative, following the recent completion of an
initial public offering.  Pro forma for the initial public
offering, Solera's operating lease-adjusted leverage has declined
to below 5x from above 6.5x as of December 2006.


SPECIALIZED TECHNOLOGY: High Leverage Cues S&P's 'B' Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Enfield, Connecticut-based Specialized Technology
Resources Inc.  The outlook is stable.  In addition, Standard &
Poor's assigned its bank loan and recovery ratings to
STR's proposed $155 million first-lien senior secured credit
facility and $125 million second-lien term loan facility.  The
first-lien facility was rated 'B+', with a recovery rating of '1',
indicating that first-lien lenders could expect to receive full
(100%) recovery of principal in the event of a  payment default or
bankruptcy.  The second-lien facility was rated 'B-' (one notch
below the corporate credit rating), with a recovery rating of '3',
indicating that second-lien lenders could expect to receive
meaningful (50%-80%) recovery of principal in the event of a
payment default.
     
"The ratings on STR reflect its highly leveraged financial
profile, aggressive financial policy, narrow business focus, small
size, and highly competitive operating environment within its two
niche business segments, manufacturing solar encapsulants and
providing quality assurance services to consumer product
manufacturers and retailers," said Standard & Poor's credit
analyst Mark Salierno.  These factors are somewhat offset by the
company's established market positions in its segments, favorable
growth prospects in its solar business, and modest capital
expenditure requirements.


SPECIALTY RESTAURANT: Wants to Employ MGLAW PLLC as Local Counsel
-----------------------------------------------------------------
Specialty Restaurant Group LLC asks the U.S. Bankruptcy Court for
the Middle District of Tennessee for authority to employ MGLAW
PLLC as its local counsel, nunc pro tunc to April 11, 2007.

MGLAW is expected, among others, to:

     a. render legal advice with respect to the rights, powers and
        duties of the Debtor in the management of its property;

     b. investigate and, if necessary, institute legal action on
        behalf of the Debtor to collect and recover assets of the
        estates of the Debtor;

     c. prepare all necessary pleadings, orders and reports with
        respect to this proceeding and to render all other legal
        services as may be necessary or proper herein;

     d. negotiate any issue regarding the Plan of Reorganization
        and Disclosure Statement and promote the financial
        rehabilitation of the Debtor;

     e. represent the Debtor in any forum as may be necessary to
        protect the interests of the Debtor; and

     f. perform all other legal services that may be necessary and
        appropriate in assisting Debtor's lead counsel with the
        general administration of this estate.

MGLAW's current standard hourly rates are:

             Designation                     Rates
             -----------                     -----
             Members                     $265 - $350
             Associates                  $155 - $235
             Paralegals                      $125

MGLAW's standard hourly rates are subject to adjustment as of
January 1 of each year.

To the best of the Debtor's knowledge, MGLAW does not hold or
represent any interest adverse to the Debtor's estate and is a
"disinterested person."

The firm can be reached at:

                  Robert J. Gonzales, Esq.
                  MGLAW PLLC
                  2525 West End Avenue, Suite 1475
                  Nashville, TN 37203
                  Tel: (615) 846-8000
                  Fax: (615) 846-9000
                  http://www.mglaw.net/

Based in Maryville, Tennessee, Specialty Restaurant Group LLC --
http://www.srg.us/- owns and operates three restaurant concepts  
with over 35 restaurants primarily located in the Eastern US.  The
American Caf,, Silver Spoon Caf,, and L&N Seafood Grill.  The
company filed for Chapter 11 protection on May 15, 2007 (Bankr.
M.D. TN, Case No. 07-03356).  When the Debtors filed for
protection from their creditors, they listed total assets of
$7,231,149 and total debts of $21,285,200.

The company previously filed for Chapter 11 protection on Feb. 13,
2007 (Bankr. N.D. TX, Case No. 07-30779).  The Debtor was then
represented by Fulrbight & Jaworski, LLP.  On May 2, 2007, the
Texas Court entered an order changing the venue for the Debtor's
case to the U.S. Bankruptcy Court for the Middle District of
Tennessee.


SPIRIT FINANCE: Moody's Assigns B1 Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service assigned a corporate family rating of B1
to Spirit Finance Corporation, the successor entity to Spirit
Finance Corp. [NYSE: SFC], a REIT that is being acquired by a
consortium led by the Macquarie Group (rated A2).

Spirit's $850 senior secured term loan, which is part of the
acquisition financing, was rated B2.  The rating outlook for
Spirit is stable.  This is the first time Moody's has rated Spirit
Finance.

"Spirit's stable cash flows derived from long-term triple-net
leases and consistently high portfolio occupancy are important
positive credit characteristics," said Maria Maslovsky, an analyst
in Real Estate Finance at Moody's.  "These credit strengths are
attenuated by tenant, geographic and industry concentrations in
the REIT's portfolio," continued Ms. Maslovsky.

According to Moody's, Spirit Finance benefits from minimal near-
term lease rollovers and debt maturities, which provide cash flow
stability and liquidity.  Moody's also acknowledges the firm's
consistently high portfolio occupancy and sophisticated consortium
of sponsors, led by Macquarie.  Counterbalancing these positives
are material geographic, tenant and industry concentrations in
Spirit's property portfolio with ShopKo representing 23% of
investment, general and discount stores and restaurants
encompassing 26% and 22% of investment, respectively, and
Wisconsin and Texas each contributing 11% of investment.  In
addition, Sprit's leverage is expected to rise materially
subsequent to the acquisition, to approximately 81% from about
63%, while its coverage should decline to 1.3X from close to 2.0X.

Moody's also believes that Spirit is subject to key-person risk
with respect to its senior management, and the REIT's extensive
reliance on outsourcing limits the depth of its platform and its
strategic flexibility.  Lack of unencumbered assets, an
opportunistic investment strategy and integration risks are
additional concerns.  Furthermore, Spirit has grown its property
portfolio rapidly, and its long-term resiliency is not
demonstrated.  The portfolio also has in it numerous specialized
properties whose value may be subject to elevated volatility, and
whose re-tenancy or sale could prove challenging.

The one-notch differential between the CFR and the term loan
rating is due to the preponderance of secured debt in Spirit's
capital structure, and the nature of the security for the term
loan -- primarily pledges of subsidiary stock -- which effectively
subordinates the term loan to existing secured debt.

The stable rating outlook reflects Moody's expectation that Spirit
will continue to operate its portfolio profitably with minimal
credit losses in the near term.  Moody's further expects Spirit to
continue its ambitious growth plan while maintaining stable,
albeit high, leverage and steady coverage.

According to Moody's, although unlikely in the near term, upward
rating movement would require reduction in leverage to below 65%
of gross assets, improvement in coverage to above 1.7X, increased
geographic diversification so that no state and no tenant
contributes over 10% of total rent, as well as improved tenant
credit and asset mix profile.  A downgrade would occur if leverage
rose to the upper 80% range (debt/assets), if there were
significant changes in the senior management team, if geographic,
tenant or industry concentrations rose above current levels, if
occupancy dropped to the low 90% range, or if key tenants
encountered credit problems.

These ratings were assigned, with a stable outlook:

   * Spirit Finance Corporation

     -- corporate family rating at B1;
     -- senior secured term loan at B2.

This firm is a guaranteed, wholly-owned subsidiary of Redford
Holdco LLC.

Spirit Finance Corporation [NYSE: SFC], headquartered in
Scottsdale, Arizona, USA, is a REIT that provides sale/leaseback
financing for single-tenant real estate assets of retail, service
and distribution companies.  The REIT's core markets include free-
standing automotive dealers, parts and service facilities,
drugstores, educational facilities, cinemas, restaurants,
supermarkets and other retail, distribution and service
businesses.  As of March 31, 2007, Spirit's assets totaled $3.1
billion, and its equity was $1.1 billion.

The Macquarie Group, headquartered in Australia, is a diversified
financial services firm that comprises Macquarie Bank Limited and
its subsidiaries and affiliates.  As of
Dec. 31, 2006, Macquarie's assets totaled A$106 billion, and its
equity was A$5.3 billion.


SPIRIT FINANCE: S&P Rates Pending $850 Million Term Loan at B
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating to Spirit Finance Corp. and a 'B' rating to its
pending $850 million six-year term loan.  The outlook is
stable.
      
"The ratings reflect Spirit's aggressive financial profile and the
less-seasoned nature of the portfolio, which weighs on the
historical stability of the company's net-leased retail real
estate assets and experienced management team," said credit
analyst Tom Taillon, who noted that a consortium of investors, led
by Macquarie Bank Ltd., has announced a plan to acquire Spirit in
a transaction valued at $3.9 billion, including $2.2 billion of
assumed debt and a new $850 million secured term loan.  "The
additional debt used to fund this transaction results in a very
aggressive balance sheet at currently high market prices and full
leverage using more-conservative asset valuation methods."
     
S&P expect Spirit's growing portfolio of net-leased assets to
produce a stable cash flow stream that is supported by a long-term
lease structure and good unit-level rent coverage.  S&P may revise
the outlook to negative if any additional debt results in further
deterioration of cash flow coverage measures, beyond their already
weak levels.  Any upward rating momentum would be dependent on a
departure from the currently aggressive financial policy.


SPORTS CLUB: Dec. 31 Balance Sheet Upside-Down by $24,190,000
-------------------------------------------------------------
The Sports Club Company Inc. disclosed a stockholders' deficit of
$24,190,000 at Dec. 31, 2006.  The company also posted at Dec. 31,
2006, total assets of $89,487,000, total liabilities of
$104,098,000, and redeemable convertible preferred stock, series B
valued at $9,579,000.

At Dec. 31, 2006, the company had cash and cash equivalents of
$2,975,000, marketable securities of $4,970,000, and restricted
cash of $1,659,000.  A year-ago, the company had $10,287,000 in
cash and cash equivalents.  Accumulated deficit at Dec. 31, 2006,
stood at $133,864,000.

                   Fourth Quarter 2006 Results

Revenues from continuing operations for the fourth quarter ended
Dec. 31, 2006 were $14,859,000, compared to $14,226,000 for the
fourth quarter ended Dec. 31, 2005, an increase of $633,000 or
4.4%.  

After Preferred Stock dividends of $347,000 and $556,000 for the
fourth quarter ended Dec. 31, 2006, and 2005, respectively, the
net income attributable to common stockholders for the fourth
quarter ended Dec. 31, 2006 was $238,000, compared to a net loss
attributable to common stockholders for the fourth quarter ended
Dec. 31, 2005 of $20,530,000.  Results for the fourth quarter
ended Dec. 31, 2005, included an impairment charge of $18,642,000.

                     Full Year 2006 Results

Revenues from continuing operations for the year ended Dec. 31,
2006 were $58,774,000, compared to $56,205,000 for the year ended
Dec. 31, 2005, an increase of $2,569,000 or 4.6%.

After Preferred Stock dividends of $1,770,000 and $2,212,000 for
the year ended Dec. 31, 2006 and 2005, respectively, the net loss
attributable to common stockholders for the year ended Dec. 31,
2006 was $6,411,000, as compared with a net loss attributable to
common stockholders for the year ended Dec. 31, 2005 of
$24,461,000.

During the year ended Dec. 31, 2006, the company sold five of its
nine sports and fitness Clubs to Millennium Partners, a major
stockholder of the company.  The net sales proceeds in excess of
the carrying value of the sold assets of $23.7 million, was
recorded as a capital contribution.

                      About The Sports Club

The Sports Club Company -- http://www.thesportsclubla.com/-- is  
based in Los Angeles, California.  It operates and owns luxury
sports and fitness complexes nationwide under the brand name The
Sports Club/LA.


STROBER ORGANIZATION: Moody's Cuts Corporate Family Rating to B2
----------------------------------------------------------------
Moody's Investors Service downgraded the debt ratings of The
Strober Organization, together with Lanoga Corporation, Pro-Build
Holdings, Inc.  The company's corporate family rating has been
downgraded to B2 from B1, while its senior secured credit
facilities' ratings have been downgraded to B1 from Ba3 to reflect
the pressure on the company's financial performance resulting from
the weak homebuilding market.  The ratings out look is stable.

These ratings/assessments were affected:

   -- Corporate Family Rating, downgraded to B2 from B1;

   -- Probability of Default Rating, downgraded to B2 from B1;

   -- $600 million senior secured revolving credit facility due
      2011, downgraded to B1 (LGD3, 37%) from Ba3 (LGD3, 37%);

   -- $700 million senior secured term loan B due 2013,
      downgraded to B1 (LGD3, 37%) from Ba3 (LGD3, 37%).

Pro-Build Holdings, Inc. financial performance has come under
pressure as a result of the slowdown in new home construction
across most of the United States.  While management has been
striving to reduce its cost structure and gain market share, this
has proven to be an uphill battle due to market conditions. Market
pressure has led the company's performance to weaken to a level
that is more in line with the B2 rating category. Furthermore, it
remains unclear how long and how deep the homebuilding slowdown
will be.

Pro-Build Holdings, Inc. is the largest distributor of building
supplies to homebuilders and remodeling contractors ("Pro-Dealer")
in the United States, operating over 500 locations across 41
states.  Pro-forma revenues for fiscal year end 2006 were
approximately $5.9 billion.


SWEETSKINZ HOLDINGS: Taps Akin Gump as Special Corporate Counsel
----------------------------------------------------------------
Sweetskinz Holdings Inc. and Sweetskinz Inc. ask permission from
the U.S. Bankruptcy Court for the District of Delaware to employ
Akin Gump Strauss Hauer & Feld LLP as their special corporate
counsel, nunc pro tunc to their bankruptcy filing.

Akin Gump will render legal services concerning general
intellectual property matters.

The Debtors will pay Akin Gump on an hourly basis.  The primary
Akin Gump attorneys who will represent the Debtors and their
corresponding rates are:

     Professional                         Hourly Rates
     ------------                         ------------
     Ronald L. Panitch, Esq., partner          $525
     Laura Genovese, Esq., senior counsel      $415
     Dennis Butler, Esq., associate            $330

Akin Gump is a creditor of the Debtors.  The Debtors owe the firm
about $19,127 for legal services rendered before the Debtors'
bankruptcy filing.  As of the bankruptcy filing, Akin Gump has a
general unsecured claim in the amount of about $5,107.

To the best of the Debtors' knowledge, Akin Gump does not
represent or hold any interest adverse to the Debtors or to their
estates.

The firm can be reached at:

            Ronald L. Panitch
            Partner
            Akin Gump Strauss Hauer & Feld LLP
            590 Madison Avenue
            New York, NY 10022-2524
            Telephone: (212) 872-1000
            Fax: (212) 872-1002
            http://www.akingump.com/

                       About SweetskinZ Inc.

SweetskinZ Inc. -- http://www.sweetskinz.com/-- has developed the  
only manufacturing methodology which imbues pneumatic tires with
any type of durable color graphic, design or logo, adding new and
original dimensions of style to the traditional black or white
walled tire.  In addition, SweetskinZ is able to produce tires
with greatly enhanced reflectivity and tires that virtually glow
in the dark during dusk.

SweetskinZ Holdings and SweetskinZ Inc. filed for chapter 11
protection on March 5, 2007 (Bankr. D. Del. Case Nos. 07-10288 and
07-10289).  Adam G. Landis, Esq., and Kerri K. Mumford, Esq., at
Landis Rath & Cobb LLP, represent the Debtors.  When the Debtors
sought protection from their creditors, they listed estimated
assets between $100,000 and $1 million and estimated debts between
$1 million and $100 million.


TESORO CORP: S&P Rates Proposed $500MM Sr. Unsecured Notes at BB+
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit rating on independent refining and marketing company Tesoro
Corp. and revised the outlook on the company to positive from
stable.  At the same time, Standard & Poor's assigned its 'BB+'
rating to Tesoro's proposed $500 million senior unsecured note
offering, and its 'BBB-' rating with a recovery rating of '1' to
Tesoro's $1.75 billion revolving credit facility.  The '1'
recovery rating reflects the expectation of full (100%)
recovery in the event of a payment default.
     
Tesoro will use proceeds for the offering to repay outstanding
borrowings on its $700 million 364-day term loan, which it used to
help fund the acquisition of the Wilmington, California, refinery
and related assets from Shell Oil Products US.  Pro forma for the
transaction, San Antonio, Texas-based Tesoro should have around
$2 billion of debt outstanding.
      
"The outlook revision to positive reflects the stronger-than-
expected financial measures, in particular debt leverage, at the
close of Tesoro's roughly $2 billion acquisition of the 100,000-
barrel-per-day Wilmington, California, refinery and 250 Shell-
branded retail locations, as well as the acquisition of 140 retail
sites from USA Petroleum," said Standard & Poor's credit analyst
Paul Harvey.
     
Thanks to continued strong refining margins, Tesoro has been able
to generate free cash flow above expectations, which it will apply
to the acquisition financing.  As a result, unadjusted debt
leverage will be well below expected levels--around 40%, compared
with the original forecast of 50%--and leave Tesoro well ahead of
scheduled deleveraging during 2007.  In addition, with much of the
key operating staff at the Wilmington refinery remaining, near-
term integration risk is somewhat mitigated.
      
"The ratings on Tesoro reflect its position as an independent oil
refiner and marketer operating in a very competitive, volatile,
and erratically profitable industry burdened by high fixed costs,"
said Mr. Harvey.  "To buffer these weaknesses, Tesoro has strong
asset quality, advantaged operating locations, and solid
liquidity."
     
The positive outlook reflects the potential for positive rating
actions over the medium term if Tesoro can continue to deleverage
and successfully integrate the Wilmington refinery as well as
realize the potential synergies from the acquisition, including
greater crude oil purchasing flexibility.  In addition, an upgrade
would depend on management's commitment to a moderate financial
profile, including future acquisition financing.  If, however,
Tesoro were to pursue acquisitions or other transactions to the
detriment of its financial strength, ratings could be stabilized
or lowered.


TARGUS GROUP: Slow Reduction of Inventories Cue S&P's Neg. Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services placed all of its ratings on
Targus Group International Inc., including the 'B' corporate
credit rating, on CreditWatch with negative implications.
     
"The CreditWatch listing is based on the company's weaker-than-
expected progress in reducing excess inventories through March 31,
2007, and the expectation that covenant cushion will significantly
tighten in the coming quarters," said Standard & Poor's credit
analyst Christopher Johnson.
     
"Although year-to-date EBITDA and sales have met and exceeded the
company's 2007 budget, margins continue to be pressured by higher
raw material costs and product mix, and debt leverage remains very
high," said Mr. Johnson.
     
Standard & Poor's will review Targus' strategic plan with
management, evaluate their progress in reducing excess
inventories, and monitor the status of the company's liquidity and
covenant cushion before resolving the CreditWatch.


TOWER RECORDS: Committee Hires Macquarie as Financial Advisors
--------------------------------------------------------------
The Official Committee of Unsecured Creditors for MTS Inc., doing
business as Tower Records, and its debtor-affiliates obtained
authority from the U.S. Bankruptcy Court for the District of
Delaware to retain Macquarie Securities (USA) Inc. as its
financial advisors as successor to Giuliani Capital Advisors LLC,
nunc pro tunc to April 13, 2007.

Macquarie will provide the Committee financial advisory services
as GCA had previously provided.

Macquarie will be compensated based on identical terms and
conditions as GCA was previously compensated in the Debtors' cases
as set in the Engagement Letter and the GCA Retention Order.

To the best of the Committee's knowledge, Macquarie does not hold
or represent an interest adverse to the interest of the Debtors'
estates.

                         About Macquarie

On March 5, 2007, GCA and Macquarie Holdings (USA) Inc., the
parent company of Macquarie entered into an agreement pursuant to
which, MHUSA agreed, among other things, to purchase substantially
all of GCA's assets.  In this connection, MHUSA extended offers of
employment to substantially all of the professionals at GCA,
including those who were advising the Committee in connection with
the Debtors' chapter 11 cases.

The Macquarie professionals that will be engaged in the Debtors'
cases are substantially the same professionals that have advised
the Committee on behalf of GCA.

The firm can be reached at:

            Murray Edward Bleach
            Co-Chief Executive Officer
            Macquarie Securities (USA) Inc.
            New York
            Tel: (1-212) 231-1000
            Fax: (1-212) 231-1010
            http://www.macquarie.com/

                      About MTS Incorporated

MTS Incorporated -- http://www.towerrecords.com/-- owns Tower  
Records and retails music in the U.S., with nearly 100 company-
owned music, book, and video stores.  The company and its
affiliates filed for chapter 11 protection on Feb. 9, 2004 (Bankr.
D. Del. Lead Case No. 04-10394).

The Debtor and its seven debtor-affiliates filed a second Chapter
11 petition on Aug. 20, 2006 (Bankr. D. N.Y. Case Nos. 06-10886
through 06-10893, Lead Case No. 06-10891).  Mark D. Collins, Esq.
of Richards Layton & Finger represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
its creditors, it listed estimated assets and debts of more than
$100 million.


TRIMAS CORP: Completed IPO Cues S&P to Lift Rating to B+ from B
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on
Bloomfield Hills, Michigan-based TriMas Corp., including its
corporate credit rating, which goes to 'B+' from 'B'.  At the same
time, all ratings were removed from CreditWatch, where they were
placed with positive implications on Aug. 4, 2006, following the
company's announcement that it had filed a registration statement
for an IPO.  The outlook is stable.
      
"The upgrade reflects the successful completion of the IPO,
proceeds of which will be principally applied to debt reduction,
and the expected improvement in credit protection measures," said
Standard & Poor's credit analyst Gregoire Buet.
     
The company will use net proceeds of the IPO to redeem
approximately $100 million of its outstanding 9.875% senior
subordinated notes and to make a $10 million payment to terminate
annual management fees.
     
The ratings on TriMas reflect its somewhat highly leveraged
financial risk profile and weak, albeit improving, credit
protection measures.  The company's leading positions in niche
markets, its relative product and end-market diversity, as well as
improving operating performance and profitability in the past year
support the rating.
     
TriMas' products (transportation towing systems, packaging
systems, aerospace fastening systems, and industrial specialty
products) serve niche markets with diverse commercial, industrial,
and consumer applications.  About 70% of revenues are from
products that have number-one or number-two positions in markets
where the company is one of only two or three manufacturers.


TURNING STONE: Increasing Concerns Cue S&P to Lower Rating to B
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Turning
Stone Casino Resort Enterprise, including its issuer credit
rating, to 'B' from 'B+'.  Turning Stone is owned by the
Oneida Indian Nation.  At the same time, all ratings remain on
CreditWatch with developing implications.  The one-notch downgrade
reflects our increasing concern surrounding the Department of
Interior's upcoming determination as to the validity of the
nation's 1993 compact with the State of New York.  The DOI
decision is expected by June 14, 2007.
     
S&P believe that the tribe and the state are continuing to
negotiate terms for a new compact, the execution of which would
resolve the issue with the DOI.  However, it is not clear that
sufficient progress is being made in these negotiations to reach
an agreement in the near term.  The two parties failed to jointly
request an extension to the DOI's June 14 decision time frame by
April 30, an option offered by the DOI, which suggests to us that
there are still meaningful differences between the position of the
nation and that of the state.
     
The DOI's determination could ultimately result in the tribe's
inability to conduct Class III gaming at Turning Stone, which
could result in the ratings being lowered further.  However, the
DOI may determine that the compact is valid, eliminating
uncertainty surrounding the ability to operate Class III machines,
and therefore reflecting positively on credit quality.    
     
If the DOI determines that the compact is not valid, the tribe has
indicated that it will pursue further litigation against the DOI
in federal court.  While such litigation could delay any order to
cease Class III gaming at Turning Stone, S&P would view this
outcome very negatively given the burden that the tribe would have
in needing to prevail to retain a valid compact.  
     
In resolving its CreditWatch listing, Standard & Poor's will
continue to closely monitor the situation as the June deadline
approaches.  "If the DOI determines that the compact is not valid,
a further downgrade may occur, notwithstanding the likelihood of
further litigation," said Standard & Poor's credit analyst Ariel
Silverberg.  "If the DOI rules that the compact is valid, or the
tribe and the state reach an agreement, the ratings could be
raised.  An upgrade would also be contingent on operating results
and the status of any other outstanding litigation."


U.S. ENERGY: Chapter 11 Plan Paying Creditors In Full Confirmed
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has entered an order confirming U.S. Energy Biogas Corp.'s plan of
reorganization, Bill Rochelle of Bloomberg News reports.

According to the report, the Plan provides full payment with
interest to creditors.

Distribution under the Plan is financed by an $80 million term
loan and revolving credit from Silver Point Capital LP.

The source relates that a critical settlement in early February
has helped in part the confirmation of the plan.

The settlement called for the Debtor to pay secured creditor
Countryside Power Income Fund $99 million upon emerging from
bankruptcy protection, the source says.

Headquartered in Avon, Conn., U.S. Energy Biogas Corp., a
subsidiary of U.S. Energy Systems Corp. (Nasdaq: USEY) --
http://www.usenergysystems.com/-- develops landfill gas projects     
in the United States.  Formerly known as Zahren Alternative Power
Corporation or ZAPCO, the company was formed in May 2001 after
ZAPCO's acquisition by U.S. Energy Systems, Inc.  Currently, the
Debtor owns and operates 23 LFG to energy projects with 52
megawatts of generating capacity.  

The Debtor and 31 of its affiliates filed separate voluntary
chapter 11 petitions on Nov. 29, 2006 (Bankr. S.D.N.Y. Case Nos.
06-12827 through 06-12857).  Joseph J. Saltarelli, Esq., at Hunton
& Williams represents the Debtors in their restructuring efforts.  
Dion W. Hayes, Esq., Joseph S. Sheerin, Esq., and Patrick L.
Hayden, Esq., at McGuireWoods LLP, represent the Official
Committee of Unsecured Creditors.  The Debtors listed total assets
of $35,472,663 and total debts of $90,250,169 in its schedules.


UNITED CLEANERS: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: United Cleaners, Inc.
        P.O. Box 7999 Pmb.
        187 Mayaguez, PR 00681
        Tel: (787) 826-8001

Bankruptcy Case No.: 07-02812-11

Type of Business: The Debtor manufactures cleaning products.

Chapter 11 Petition Date: May 23, 2007

Court: District of Puerto Rico (Old San Juan)

Debtor's Counsel: Winston Vidal-Gambaro, Esq.
                  P.O. Box 193673
                  San Juan, PR 00919-3673
                  Tel: (787) 751-2864
                  Fax: (787) 763-6114

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Internal Revenue Services        taxes                 $300,000
Mercantil Plaza Building R-2
Avenue Ponce de Leon
San Juan, PR 00918-1693

Departamento del Trabajo y       taxes                  $90,000
Recursos Humanos
P.O. Box 71592
Edif Prudencio Rivera
San Juan, PR 00936-8692

Department of Treasury of        taxes                  $77,000
Puerto Rico
Bankruptcy Section (424-B)
P.O. Box 9024140
San Juan, PR 00902-4140

C.F.S.E.                         trade debt             $72,006

Popular Auto                     bank loan              $60,000

Banco Popular de Puerto          bank loan              $49,000
Rico
Division Department de
Quiebras

Banco Santander Puerto           bank loan              $35,000
Rico

Wells Fargo                      bank loan              $31,087

Kimberly Clark                   trade debt             $29,706

Bunzi                            trade debt             $28,583

U.S. Department of Labor         trade debt             $15,201
Wage and Hour Division
San Patricio

Canberra Corporation             trade debt             $14,474

Ochoa Industrial                 trade debt              $9,768

Summit International             trade debt              $8,732

Active Salesmen Company,         trade debt              $7,196
Inc.

Marcas Floor Care, Inc.          trade debt              $6,838

C.P.A. Armando Aviles            trade debt              $6,300
Galloza

M.A.P.F.R.E.                     trade debt              $6,000

Gent-L-Kleen                     trade debt              $5,091

E.D. Distributors, Inc.          trade debt              $5,000


VALLEY OIL: Secured Creditor Wants Chapter 11 Case Dismissed
------------------------------------------------------------
Fifth Third Bank, a secured creditor in Valley Oil Group LLC's
chapter 11 bankruptcy case, filed a motion with the United States
Bankruptcy Court for the Eastern District of Kentucky in London
seeking dismissal of the Debtor's case, Bill Rochelle of Bloomberg
News says.

The report cited the bank as saying that the Debtor filed the
petition to prevent a state court receiver from turning the
Debtor's property over to a buyer at a foreclosure sale for
$4.5 million.  

The buyer was scheduled to take possession of the property
Tuesday, May 29, 2007, the source says.

Headquartered in Somerset, Kentucky, Valley Oil Group LLC dba
Tradewinds Expressmart, owns and operate convenience stores.
The Debtor filed for chapter 11 protection on May 20, 2007
(Bankr. E.D. Ky. Case No. 07-60463.  Edward S. Monohan, V., Esq.,
at Monohan & Blankenship represent the Debtor.  When the Debtor
filed for bankruptcy, it listed total assets of $12,178,450 and
total debts of $71,095,000.


VERINT SYSTEMS: Witness Systems Acquisition Deal Approved
---------------------------------------------------------
Verint Systems Inc. disclosed in a press statement, that the UK
Office of Fair Trading has approved the acquisition of Witness
Systems and has decided not to refer the transaction to the U.K.
Competition Commission.  The company expects the acquisition to
close prior to May 29, 2007.

Witness Systems (NASDAQ: WITS) -- http://www.witness.com/-- helps  
businesses capture customer intelligence and optimize their
workforce performance.  The company's Impact 360(TM) solution
features quality monitoring, compliance and IP recording,
workforce management, performance management, eLearning and
customer feedback.  Primarily deployed in contact centers - well
as the remote, branch and back offices of global organizations -
the workforce optimization solution captures, analyzes and enables
users to share and act on cross-functional information across the
enterprise.  

The company, in a separate statement, related that the Nasdaq
Stock Market would delist its common stock, which was suspended on
Feb. 1, 2007, and has not traded on NASDAQ since that time.

The company stated that NASDAQ would file a Form 25 with the
Securities and Exchange Commission to complete the delisting.  The
delisting becomes effective ten days after the Form 25 is filed.

                       About Verint Systems

Headquartered in Melville, New York, Verint Systems Inc. (VRNT.PK)
-- http://www.verint.com/-- is a provider of analytic software-
based solutions for security and business intelligence.  Verint
software, which is used by over 1,000 organizations in over 50
countries worldwide, generates actionable intelligence through the
collection, retention and analysis of voice, fax, video, email,
Internet and data transmissions from multiple communications
networks.

                          *     *     *

As reported in the Troubled Company Reporter on April 24, 2007,
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Verint Systems Inc.  At the same time, we
assigned our 'B' bank loan rating, and '3' recovery rating to the
company's proposed $675 million first-lien credit facility,
indicating that lenders can expect meaningful (50%-80%) recovery
of principal in the event of payment default," said Standard &
Poor's credit analyst David Tsui.   The outlook is developing.


WCI COMMUNITIES: Board of Directors To Continue Sale Process
------------------------------------------------------------
WCI Communities Inc.'s has responded to Icahn's tender offer
expiration, stating that its board of directors will continue to
move forward with the sale process, a process that is open to all
potential buyers, including Carl Icahn, and designed to maximize
shareholder value.  

The company urges shareholders to vote the WHITE proxy card to re-
elect the current board of directors who will continue to oversee
a fair and transparent sale process.

On May 16, 2007, WCI Communities has sent a letter to its
shareholders in connection with its forthcoming annual meeting,
seeking shareholder support to re-elect the current board.

The company mentioned in the letter, that WCI is working with
Goldman Sachs & Co., its financial advisors, to move the sale
process forward.

In the letter, the company said that its board is committed to
making sure that the sale process it has initiated and which is
underway is fair, transparent and designed to get the best
possible price for WCI shares in the current market and will
ensure that the result will be to maximize the value of WCI shares
for all of the company's shareholders.  

The letter also noted that at present, the company has entered
into a number of confidentiality agreements with entities that
have expressed an interest in acquiring WCI, the company has
invited Carl Icahn to join the process, and he has chosen not to
participate.

The letter also advised shareholders that the election of a slate
of directors proposed by Carl Icahn could jeopardize the sale
process or make the process less than fair and open.

Copies of the definitive proxy statement and any amendments and
supplements to the definitive proxy statement are available for
free by contacting:

   WCI Communities Inc.
   No. 24301 Walden Center Drive
   Bonita Springs, FL 34134

In addition, copies of the proxy materials may be requested by
contacting our proxy solicitor, Innisfree M&A Incorporated, at
(888) 750-5834 toll-free.

                      About WCI Communities

Headquartered in Florida, WCI Communities Inc. (NYSE: WCI) --
http://www.wcicommunities.com/-- is a home builder catering to   
primary, retirement, and second-home buyers in Florida, New York,
New Jersey, Connecticut, Maryland and Virginia.  The company
offers both traditional and tower home choices and features a wide
array of recreational amenities in its communities.  In addition
to homebuilding, WCI generates revenues from its Prudential
Florida WCI Realty Division and its recreational amenities, as
well as through land sales and joint ventures.  The company
currently owns and controls developable land on which the company
plans to build about 20,000 traditional and tower homes.

                          *     *     *

As reported in the Troubled Company Reporter on March 20, 2007,
Standard & Poor's Ratings Services placed its ratings on WCI
Communities Inc.'s Corporate credit at B+, and Senior subordinated
at B-, on CreditWatch with negative implications after the
announcement that affiliates of Carl Icahn plan to make a hostile
tender offer for WCI's shares.


WHOLE FOODS: Reschedules Tender Offer Expiration Date to June 20
----------------------------------------------------------------
Whole Foods Market Inc. had extended the expiration date for its
tender offer to purchase outstanding shares of Wild Oats Markets,
Inc. to 5:00 p.m., New York City time, Wednesday, June 20, 2007.
    
On Feb. 21, 2007, the company and Wild Oats signed a definitive
merger agreement under which the company would acquire Wild Oats'  
outstanding common stock in a cash tender offer at a price of
$18.50 per share, or approximately $565 million.  The company will
also assume Wild Oats' existing net debt of approximately
$106 million on Sept. 30, 2006.  The company expects to fund the
transaction at closing using $700 million in new senior term loan
facilities.  

Additionally, the company intends to expand its existing long-term
senior revolving credit facility to $250 million.  The company
agreed in the merger agreement to commence a tender offer on
Feb. 27, 2007 for all of Wild Oats' outstanding common stock.  The
tender offer is conditioned upon a majority of the outstanding
Wild Oats' shares being tendered, well as customary regulatory and
other closing conditions, including the expiration or termination
of any waiting period under the Federal Trade Commission's Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended.  Wild
Oats' board of directors has unanimously recommended that Wild
Oats' stockholders tender their shares in the offer.  The Yucaipa
Companies, Wild Oats' shareholder with approximately 18%
ownership, has committed to tendering its shares.
    
The company is working with the FTC regarding the HSR Act review.
On March 13, 2007, the company and Wild Oats received a second
request for additional information from the FTC in connection with
the company's proposed tender offer.  On March 21, 2007, the
company extended the expiration date for its tender offer to
purchase outstanding shares of Wild Oats to 5:00 p.m., Eastern
Daylight Time, Tuesday, April 24, 2007.  On April 24, 2007, the
company again extended the expiration date for its tender offer to
purchase outstanding shares of Wild Oats to 5:00 p.m., Eastern
Daylight Time, Tuesday, May 22, 2007.

The extended tender offer is subject to additional extensions and
to the receipt of customary regulatory approvals, including the
expiration or termination of any waiting period under the HSR Act.
    
Although the FTC has not yet decided whether to challenge the Wild
Oats transaction, members of the FTC staff have voiced concerns
regarding perceived anticompetitive effects resulting from the
proposed tender offer and merger.  Approval of the transaction by
Whole Foods shareholders is not required.
    
As of the close of business on May 21, 2007, a total of 20,956,505
shares of common stock of Wild Oats, which represent approximately
70.1% of the 29,882,910 shares that were outstanding as of
April 27, 2007 have been tendered and not withdrawn pursuant to
the tender offer.
   
Stockholders of Wild Oats may obtain a free copy of documents
filed by Wild Oats or Whole Foods Market with the Securities and
Exchange Commission by contacting the information agent for the
tender offer:

   -- Georgeson Inc.
      Tel: (212) 440-9800, or
           (866) 313-2357 (toll free)

Copies may also be obtained by contacting the dealer manager for
the tender offer:

   -- RBC Capital Markets Corporation
      Tel: (415) 633-8668, or
           (800) 777-9315 EXT. 8668 (toll free)

                     About Wild Oats Markets

Headquartered in Boulder, Colorado, Wild Oats Markets Inc. --
http://www.wildoats.com/-- is a natural and organic foods  
retailer in North America with annual sales of approximately $1.2
billion.  Wild Oats Markets was founded in Boulder, Colorado in
1987.  Wild Oats Markets currently operates 110 stores in 24
states and British Columbia, Canada under four banners: Wild Oats
Marketplace (nationwide), Henry's Farmers Market (Southern
California), Sun Harvest (Texas), and Capers Community Market
(British Columbia).

                     About Whole Foods Market

Founded in 1980 in Austin, Texas, Whole Foods Market, Inc.
(NASDAQ: WFMI) -- http://www.wholefoodsmarket.com/-- is a Fortune
500 company and the largest natural and organic foods retailer.
The company had sales of $5.6 billion in fiscal year 2006 and
currently has 191 stores in the United States, Canada and the
United Kingdom.

                          *     *     *

As reported in the Troubled Company Reporter on May 1, 2007,
Standard & Poor's Ratings Services said that while the ratings on
Whole Foods Market Inc., including the 'BBB-' corporate credit
rating, currently remain on CreditWatch with negative
implications, where they were placed on Feb. 22, 2007, S&P will
lower the corporate credit rating to 'BB+' from 'BBB-' upon
closure of its acquisition of Wild Oats Inc.  At this time,
ratings will also be removed from CreditWatch.  The outlook will
be stable.


XM SATELLITE: Antitrust Chairman Balks at XM-Sirius Combination
---------------------------------------------------------------
U.S. Senator Herb Kohl, chairman of the Senate antitrust
subcommittee, is pushing for the rejection of $41 billion merger
deal of XM Satellite Holdings Inc. and Sirius Satellite Radio Inc,
according to various reports.

As reported in the Troubled Company Reporter on Feb. 22, 2007,
SIRIUS and XM Satellite Radio disclosed a definitive agreement
under which the companies will be combined in a tax-free, all-
stock merger of equals.  XM stockholders will receive 4.6 shares
of SIRIUS common stock for each share of XM they own.  XM and
SIRIUS stockholders will each own approximately 50% of the
combined company.

The transaction is subject to approval by both companies'
stockholders, the satisfaction of customary closing conditions and
regulatory review and approvals, including antitrust agencies and
the FCC.  The companies expect the transaction to be completed by
the end of 2007.

According to a letter Mr. Kohl wrote, he implored the Justice
Department and the Federal Communications Commission to consider
scraping out the proposed $4 billion buyout of XM by Sirius,
insisting that the transaction is contrary to antitrust law and
not in the public interest.

Various sources relate that Mr. Kohl further recounted that the
merger aims to monopolize the satellite radio market and the audio
entertainment market, which are distinct from each other.

The National Association of Broadcasters, the lobby group
representing radio and television programmers, supports Mr. Kohl's
views, Corey Boles of MarketWatch writes.

                   About SIRIUS Satellite Radio

Based in New York, SIRIUS Satellite Radio Inc. (NASDAQ: SIRI) --
http://www.sirius.com/ -- provides sports radio programming,  
broadcasting play-by-play action of more than 350 pro and college
teams.  SIRIUS features news, talk and play-by-play action from
the NFL, NASCAR, NBA, NHL, Barclays English Premier League soccer,
UEFA Champions League, the Wimbledon Championships and more than
125 colleges, plus live coverage of several of the year's top
thoroughbred horse races.  SIRIUS also features programming from
ESPN Radio and ESPNews.

                        About XM Satellite

Headquartered in Washington, D.C., XM Satellite Radio Holdings
Inc. -- http://www.xmradio.com/-- parent of XM Satellite Radio  
Inc. (Nasdaq:XMSR), is a satellite radio broadcaster.

                          *     *     *

As reported in the Troubled Company Reporter on Feb. 22, 2007,
Standard & Poor's Ratings Services placed all its ratings,
including the 'CCC+' corporate credit rating, on XM Satellite
Radio Holdings Inc. and XM Satellite Radio Inc., which are
analyzed on a consolidated basis, on CreditWatch with positive
implications, following the company's definitive agreement to an
all-stock "merger of equals" with Sirius Satellite Radio Inc.

Moody's Investors Service affirmed these existing debt ratings of
XM Satellite Radio Holdings, Inc.: Caa1 corporate family rating
and Caa1 probability-of-default rating; and XM Satellite Radio,
Inc.: B1 secured revolver rating and Caa1 senior floating rate
notes rating.


* BOOK REVIEW: Ancient Curious and Famous Wills
-----------------------------------------------
Author:     Virgil M. Harris
Publisher:  Beard Books
Paperback:  492 pages
List Price: $34.95

Order your personal copy at
http://www.amazon.com/exec/obidos/ASIN/1587980711/internetbankrupt

The book Ancient Curious and Famous Wills is written by Virgil M.
Harris. It is an entertaining collection of wills, reflecting the
times and the people who wrote them.

This collection offers delightful reading for lawyers and laymen
alike. As the author states: "Wills reflect, as a mirror, the
customs and habits of the times when written, as well as the
characters of the writers.

" In the category of ancient wills, the reader will find the
oldest written will, dated at 2550 B.C., as well as wills of such
personages as Plato and Aristotle.

Other categories in the collection include: wills in fiction and
poetry; curious wills; testamentary and kindred miscellany; wills
of famous foreigners, such as Napoleon and William Shakespeare;
and wills of famous Americans, such as Benjamin Franklin and
Thomas Jefferson.

                             *********

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, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, John Paul C. Canonigo, 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 ***