/raid1/www/Hosts/bankrupt/TCR_Public/070607.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, June 7, 2007, Vol. 11, No. 134
Headlines
ABRAMS FLOOR: Case Summary & 17 Largest Unsecured Creditors
ALLIS-CHALMERS: Strong Performance Cues Moody's to Up All Ratings
AMEREX GROUP: March 31 Balance Sheet Upside-Down by $4.6 Million
AMEREX GROUP: In Default of CAMOFI Master Credit Agreement
AMERIQUEST MORTGAGE: S&P Holds B Rating on Class M-4 Certificates
AMORTIZING RESIDENTIAL: S&P Lowers Ratings on 16 Cert. Classes
AMP'D MOBILE: Seeks Court OK to Use Kings Road Cash Collateral
AMP'D MOBILE: Verizon Wireless Objects to Cash Collateral Use Plea
ASARCO LLC: Court Okays Bid Procedures for Salt Lake Property Sale
ASARCO LLC: Wants Toxic Tort Claims Procedures Established
ASSET BACKED: Moody's Junks Rating on Class B-1A & M-4 Certs.
ATLAS PIPELINE: Inks Pact to Buy Anadarko's Chaney/Midkiff Assets
ATLAS PIPELINE: Moody's May Cut Low-B Ratings After Review
AVAYA INC: Silver Lake Merger Deal Cues S&P to Lower Rating to B+
BARE ESCENTUALS: Debt Reduction Cues S&P to Lift Rating to B+
BEAR STEARNS: Fitch Puts Low-B Ratings on Three Cert. Classes
BCE INC: Largest Shareholder Joins Bidding War, Buys More Shares
BEST BRANDS: Weak Performance Prompts S&P to Cut Rating to B-
BRISTOW GROUP: Amends Pact to Increase Credit Facility to $325MM
BROMONT PAVILION: Merrill Lynch to Sell Collateral on June 12
CBRL GROUP: Completes Redemption & Conversion of Convertible Notes
CELESTICA INC: May Be Next Acquisition Target, Analysts Say
CHARLES RIVER: Fitch Affirms BB Rating on $4.8 Mil. Class C Notes
CLONDALKIN INDUSTRIES: Moody's Holds B1 Corporate Family Rating
COLLINS & AIKMAN: Working to Resolve Soft Trim Sale Objections
COLLINS & AIKMAN: Subsidiary Not Related to Debtor, Tandus Says
CONVERSE INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors
CREDIT SUISSE: Fitch Holds Low-B Ratings on Five Certificates
CT CDO: Fitch Affirms Low-B Ratings on Six Classes
DELPHI CORP: Inks $55.6 Million Sale Deal for Catalyst Business
FAITH UNLIMITED: Case Summary & 10 Largest Unsecured Creditors
FIRST BANCORP: Board Declares $0.07 Per Share Dividend
FIRST HORIZON: Fitch Puts B Rating on Negative Watch
FLEXTRONICS INT'L: Solectron Bid Prompts Fitch's Negative Watch
FLOORPLAN ABS: Fitch Puts BB+ Ratings on Two Classes of Securities
GENCORP INC: S&P Rates Proposed $280 Mil. Bank Financing at BB-
GENERAL MOTORS: Davis and Marinello Elected to Board of Directors
GENERAL MOTORS: CEO Faces Criticism Despite Progress Report
GLUTH BROS: Case Summary & 20 Largest Unsecured Creditors
GUGGENHEIM STRUCTURED: Fitch Holds BB Rating on $10MM Class F Debt
HANCOCK FABRICS: Equity Panel Objects to Ableco DIP Financing
HANCOCK FABRICS: Equity Panel Wants Sonnenschein as Lead Counsel
HANCOCK FABRICS: Equity Panel Want to Hire Bayard as Co-Counsel
HARGRAY HOLDINGS: S&P Puts Corporate Credit Rating at B
HELLER FINANCIAL: Fitch Holds Low-B Ratings on Two Certificates
HSI ASSET: Moody's Rates Class M-10 Certificates at (P)Ba1
INNOVATIVE TECHNOLOGY: Wants Leach Travell as Bankruptcy Counsel
INTERACTIVE BRAND: March 31 Balance Sheet Upside-Down by $35.9MM
ISLE OF CAPRI: Has Until July 25 to Comply with Nasdaq Rules
JEAN COUTU: Debt Repayment Prompts Fitch to Withdraw Ratings
JP MORGAN: S&P Affirms B Rating on Class B-5 Issue
KENNETT SQUARE: Formation/JER Buyout Cues S&P to Retain Watch
KNARFD LLC: Case Summary & Eight Largest Unsecured Creditors
KRATON POLYMERS: Weakened Profitability Cues S&P to Lower Ratings
LANDSAFE PROPERTIES: Voluntary Chapter 11 Case Summary
LB-UBS COMMERCIAL: Moody's Rates Three Cert. Classes at Low-B
MARQUEE HOLDINGS: To Form New Holding Company
MASTR SPECIALIZED: Moody's Cuts Rating on Class B Certs. to Ba3
MERITAGE MORTGAGE: Poor Performance Cues S&P to Lower Ratings
MERRILL LYNCH: Moody's Holds Low-B Ratings on Six Cert. Classes
MGM MIRAGE: Completes $200MM Sale of Colorado Belle & Edgewater
MICROCOMPUTER TECHNOLOGY: Voluntary Chapter 11 Case Summary
MORGAN STANLEY: Fitch Holds Junk Ratings on Three Certificates
MSGI SECURITY: Faces Delisting of Common Stocks from Nasdaq
NATIONSTAR HOME: Moody's Rates Class M-10 Certificates at (P)Ba1
NEWSTAR COMMERCIAL: Fitch Rates $29.1 Million Class Notes at BB
NORANDA ALUMINUM: Notes Issuance Cues S&P to Lower All Ratings
OSI RESTAURANT: Stockholders Approve Amended Merger Agreement
OSI RESTAURANT: S&P Affirms Ratings and Removes Developing Watch
PINNACLE ENTERTAINMENT: Prices $385 Million Senior Notes Offering
PITTSBURGH BREWING: Bankruptcy Court Confirms Reorganization Plan
PROBE MANUFACTURING: Inks Exclusive Partnership w/ HPV Technology
PUIG INC: Section 341(a) Meeting Scheduled on July 2
PUIG INC: Taps Berger Singerman as General Counsel
RESMAE MORTGAGE: Court Confirms Plan of Reorganization
SCOTTISH RE: Fitch Lifts Issuer Default Rating to BB- from B+
SEARS HOLDINGS: Solid Balance Sheet Cues Fitch to Affirm Ratings
SECUNDA INT'L: Moody's Places Low-B Ratings Under Review
SOLECTRON CORP: Flextronics Merger Pact Cues Fitch's Pos. Watch
SORIANO & FRIENDS: Case Summary & 11 Largest Unsecured Creditors
SR TELECOM: Posts CDN$12.2 Million Net Loss in Qtr. Ended March 31
STERLING CENTRECORP: OSC Confirms Shareholder Vote on Plan
STRUCTURED ASSET: S&P Cuts Ratings and Retains Negative Watch
TD AMERITRADE: Jana & S.A.C. Suggests Merger to Boost Value
TD AMERITRADE: Appoints Fredric Tomczyk as Chief Operating Officer
THERMACLIME INC: Operating Improvements Cue S&P's Positive Watch
TL HOLDINGS: Financial Risk Cues S&P to Assign B Credit Rating
TRIBUNE CO: Chandler Trusts Agents Resign as Board Members
W&T OFFSHORE: Moody's Rates $450 Mil. Sr. Unsec. Notes at B3
WACHOVIA BANK: Moody's Rates Classes J & K Certificates at Low-B
WAMU MORTGAGE: Moody's Rates Classes B-9 & B-10 Certs. at Low-B
WARNER MUSIC: Fitch Comments on Risk of Potential Bid for EMI
WESTERN REFINING: Completes Giant Industries Acquisition
WHOLE FOODS: Challenges FTC's Wild Oats Merger Opposition
* Bankrupt Ontario Resident Charged with Bankruptcy Offences
* Reed Smith Launches New Bankruptcy Appellate Practice
* Wachtell Lipton Tops Ranking in 2006 Vault Guide
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
*********
ABRAMS FLOOR: Case Summary & 17 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Abrams Floor Covering, Inc.
aka Abrams Flooring Company, Inc.
1217 North Dixie Highway
Lake Worth, FL 33460
Bankruptcy Case No.: 07-14319
Type of Business: The Debtor markets carpets and other hardwood
floor finishes and decoration.
Chapter 11 Petition Date: June 5, 2007
Court: Southern District of Florida (West Palm Beach)
Judge: Steven H. Friedman
Debtor's Counsel: Craig I. Kelley, Esq.
Kelley & Fulton, P.A.
1665 Palm Beach Lakes Boulevard, Suite 1000
West Palm Beach, FL 33401
Tel: (561) 491-1200
Fax: (561) 684-3773
Total Assets: $1,183,677
Total Debts: $227,138
Debtor's List of its 17 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Mohawk Factoring, Inc. Vendor $26,941
P.O. Box 25079
Atlanta, GA 30325-0479
Hoboken Floors Vendor $5,659
1815 Cypress Lake Drive
Orlando, FL 32837
Palm Beach County Tax Collector Property Taxes for $5,455
P.O. Box 3353 38-43-44-21-15-
West Palm Beach, FL 33402-3353 378-0060
Property Taxes for Unknown
38-43-44-21-15-
378-0110
Bo Allen Deposit for $4,304
Pending Job
Patricia Zasowoski Deposit for $3,000
Pending Job
Beaulieu Group LLC Vendor $2,620
Johnson Wholesale Floors, Inc. Vendor $2,178
Darryl Figueroa, Esq. Legal Services $1,588
Burtco Enterprise Vendor $1,534
FUCHS Deposit for $1,000
Pending Job
Don & Betty Granstaff Deposit for $500
Pending Job
William Benjamin II Deposit for $200
Pending Job
Charles E. Abrams, II Settlement Unknown
Agreement
City of Lake Worth Fire Code Violations Unknown
James D. Wilkerson, Jr., P.A. Legal Services Unknown
Jeffery Begens, Esq. Attorney's Fees Unknown
Zetta Abrams Bryan Pending Shareholders Unknown
Derivative Lawsuit
ALLIS-CHALMERS: Strong Performance Cues Moody's to Up All Ratings
-----------------------------------------------------------------
Moody's Investors Service upgraded Allis-Chalmers Energy, Inc.'s
Corporate Family Rating to B2 from B3, its Probability of Default
Rating to B2 from B3, and its senior unsecured note ratings to B2
(LGD 4, 55%) from B3 (LGD 4, 53%). The rating outlook is stable.
This rating action ends a review for possible upgrade initiated on
Jan. 16, 2007. The company's SGL-2 speculative grade
liquidity rating was not affected by the rating actions.
The rating upgrade reflects:
(1) ALY's strong financial performance, stemming from
historically robust industry fundamentals and the
company's success thus far in integrating its
acquisitions;
(2) its increased scale and diversification, both by product
line and geographically, which has been primarily
achieved through acquisitions; and
(3) management's willingness to issue equity to fund a
significant portion of material acquisitions.
The stable outlook reflects a supportive sector outlook, albeit
not as strong as the last two years, and incorporates the
assumption that ALY will continue to fund material acquisitions
with a sufficient equity component. Given the recent ratings
upgrade, a positive outlook or ratings upgrade is unlikely over
the near-term. Despite ALY's improved scale and strong
performance to date, the company continues to face valuation
and performance risk inherent to a proportionately high level of
acquisitions priced during up-cycle conditions and event risk and
integration risk resulting from its aggressive growth strategy.
The rating or outlook could be pressured if ALY falls materially
short of its forecasts or conducts material leveraged acquisitions
without visibility for near-term debt reduction.
Management's growth strategy has improved the company's product
and service capabilities; enhanced its market positions in several
of its product lines, particularly in the domestic rental tools
market; increased its geographic diversification, with exposure to
both onshore and offshore domestic markets, as well as Argentina;
and provided for greater economies of scale. Nevertheless, Moody's
notes that a large proportion of ALY's earnings and cash flow
remain dependent on highly cyclical
drilling activity. In addition, ALY faces both operating risks
associated with being a recent entrant into the land drilling rig
contracting business and political risk and economic instability
in Argentina.
Strong industry fundamentals and ALY's success thus far in
integrating its acquisitions have resulted in the company
generating strong financial results reasonably commensurate with
forecasts. ALY generated EBITDA of approximately $46 million in
the first quarter of 2007, with EBITDA margins of approximately
34%, which compares favorably to its B2 rated peers and represents
substantial growth versus EBITDA levels of $13 million for the
prior year period. Debt/EBITDA was approximately 2.9x based on
annualized first quarter 2007 EBITDA, and EBIT/Interest was 2.3x.
However, given the recent vintage of most of its business
structure, it remains unclear how the company will perform in a
cyclical downturn.
Through two equity issuances over the past year, management has
demonstrated its willingness to finance material acquisitions with
a substantial equity component. In January of this year, ALY
issued $100 million in equity to fund a portion of its $342
million acquisition of Oil & Gas Rental Services. This follows
the company's $47 million equity issuance in August 2006, proceeds
of which were used to partly fund the $135 million DLS
acquisition. In addition, the company issued $51 million of
equity to the sellers of OGR and approximately $33 million to the
sellers of DLS. The January equity issuance and de-leveraging
provides a degree of financial cushion supportive of the B2 rating
in light of the risks associated with ALY's aggressive acquisition
strategy. Moody's expects that ALY will remain acquisitive, which
could result in increased leverage levels. While management has
stated that it intends to continue to issue equity to fund a
meaningful portion of material acquisitions, equity market access
may not be as supportive during weaker points in the cycle.
Allis-Chalmers Energy, Inc. is headquartered in Houston, Texas.
AMEREX GROUP: March 31 Balance Sheet Upside-Down by $4.6 Million
----------------------------------------------------------------
Amerex Group Inc. reported a net loss of $1,314,993 on revenues of
$2,147,872 for the first quarter ended March 31, 2007, compared
with a net loss of $1,150,459 on revenues of $1,186,845 for the
same period ended March 31, 2006.
The increase in revenues was primarily a result of the
commencement of the EQ/Wal Mart contract, which accounted for
approximately $531,000 or 25% of revenue for the three months
ended March 31, 2007. This project began in August of 2006 and
did not affect the revenue for the period ending March 31, 2006.
During the three month period ending March 31, 2007, operating
expenses were $815,393, compared to operating expenses of $763,039
for the comparable three month period ending March 31, 2006.
During the three month period ending March 31, 2007, net non-
operating expenses were $1,268,507 as compared with net non-
operating expenses of $826,427 for the three months ended
March 31, 2006. The increase in the current year period was due
to increased amortization of debt discounts and deferred financing
fees and increased interest expense resulting from increased debt
that was undertaken subsequent to March 31, 2006, and partially
offset by decreases in financing penalties fees.
Loss from continuing operations for the three months ended March
31, 2007, was $1,221,282, compared to loss from continuing
operations of $1,150,459 in the prior year period.
The company realized a loss of $93,711 in the three months ended
March 31, 2007 resulting from expenses related to its discontinued
operations.
At March 31, 2007, the company's balance sheet showed $8,413,843
in total assets and $13,092,169 in total liabilities, resulting in
a $4,678,326 total stockholders' deficit.
The company's balance sheet at March 31, 2007, also showed
strained liquidity with $3,521,471 in total current assets
available to pay $13,092,169 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?20ab
Going Concern Doubt
As reported in the Troubled Company Reporter on May 24, 2007,
Sartain Fischbein & Co., in Tulsa, Okla., expressed substantial
doubt about Amerex Group 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 reported d
that the company has experienced cash flow difficulties, and is in
default on its note agreements.
About Amerex Group
Headquartered in Tulsa, Oklahoma, Amerex Group Inc. --
http://www.amerexgroup.com/-- is engaged, through its
subsidiaries, in the industrial and household waste management
services industry and the environmental remediation and abatement
services industry. Industrial waste management services are
conducted through AMEREX Companies Inc, an Oklahoma corporation
and wholly-owned subsidiary, and Waste Express Inc., a Missouri
corporation and wholly-owned subsidiary of AMEREX Companies Inc.
AMEREX GROUP: In Default of CAMOFI Master Credit Agreement
----------------------------------------------------------
Amerex Group Inc. disclosed in a regulatory filing with the U.S.
Securities and Exchange Commission that as of March 31, 2007, it
was not in compliance with certain covenants of its credit line
with CAMOFI Master LDC. The company says that it is now in
default of that agreement.
The company discloses that the debt has been reclassified as
current as of March 31, 2007.
The credit agreement was entered into on Aug. 31, 2006, and grants
the company a line of credit with a maximum borrowing equal to the
lesser of $1.5 million or 80% of account receivable aged less than
90 days in consideration for the issuance to CAMOFI Master LDC of
a five-year warrant to purchase 750,000 shares of common stock at
an exercise price of $0.01 per share.
The company also entered into 10% Senior Secured Convertible Notes
dated Nov. 21, 2005, with CAMOFI MASTER LDC and a limited number
of Qualified Institutional Investors. The stated principal of the
Notes was $6,000,000, which was increased to $6,800,000 on
Feb. 23, 2006. A separate agreement with holders of the Notes
provided that the company would pay liquidated damages to the
holders of the Notes if a registration statement was not filed and
declared effective by certain dates in 2006.
The company has accrued financing penalty fees due to non
compliance in the amount of $503,200 at March 31, 2007, for delays
in the effectiveness of the registration statement to register the
warrants and conversion shares beyond October 30, 2006.
Notes Default
In early 2006, the company was also in noncompliance with certain
covenants in the Notes agreement regarding delivery of financial
information. As of March 31, 2007, the company was again in
noncompliance with certain covenants in the Notes agreement
regarding delivery of financial information and liens on assets.
The Company also has failed to make certain principal payments in
2007. As a result, the company is in default of its Notes
agreement and no waiver has yet been obtained from the lender.
About Amerex Group
Headquartered in Tulsa, Oklahoma, Amerex Group Inc. --
http://www.amerexgroup.com/-- is engaged, through its
subsidiaries, in the industrial and household waste management
services industry and the environmental remediation and abatement
services industry. Industrial waste management services are
conducted through AMEREX Companies Inc, an Oklahoma corporation
and wholly-owned subsidiary, and Waste Express Inc., a Missouri
corporation and wholly-owned subsidiary of AMEREX Companies Inc.
AMERIQUEST MORTGAGE: S&P Holds B Rating on Class M-4 Certificates
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' rating on the
class M-4 asset-backed pass-through certificates from Ameriquest
Mortgage Securities Inc.'s series 2002-2 and removed it from
CreditWatch, where it was placed with negative implications on May
9, 2006. S&P originally rated class M-4 'BBB-'. Additionally,
S&P affirmed its ratings on classes M-2 and M-3 from this
transaction.
The class M-4 rating affirmation and removal from CreditWatch
negative reflect growth in overcollateralization during the past
four months, as monthly net losses have remained below monthly
excess interest during this period. However, O/C is currently
0.35% of the original pool balance, which is still below its
target of 0.50%. In addition, total delinquencies remain
relatively high at 25.79% of the current pool balance, with severe
delinquencies (90-plus days, foreclosure, and REO) of 15.77%.
Cumulative realized losses are 2.53% of the original pool balance.
However, there is adequate actual and projected credit support to
maintain the 'B' rating.
The collateral for this transaction consists of 30-year, fixed- or
adjustable rate subprime mortgage loans secured by first liens on
one- to four-family residential properties.
Rating Affirmed and Removed from Creditwatch Negative
Ameriquest Mortgage Securities Inc.
Asset-backed pass-through certificates series 2002-2
Rating
------
Series Class To From
------ ----- -- ----
2002-2 M-4 B B/Watch Neg
Ratings Affirmed
Ameriquest Mortgage Securities Inc.
Asset-backed pass-through certificates series 2002-2
Series Class Rating
------ ----- ------
2002-2 M-2 AA
2002-2 M-3 BBB
AMORTIZING RESIDENTIAL: S&P Lowers Ratings on 16 Cert. Classes
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 16
classes of mortgage-backed securities issued by seven Amortizing
Residential Collateral Trust transactions. S&P placed seven of
the lowered ratings on CreditWatch negative, left seven ratings on
CreditWatch negative, and removed one rating from CreditWatch
negative. The other class was simply downgraded. At the same
time, the ratings on two other classes from two different ARC
transactions remain on CreditWatch negative. Additionally, S&P
placed the rating on class M3 from series 2002-BC4 on CreditWatch
negative and removed the rating on class M1 from series 2001-BC1
from CreditWatch negative. Furthermore, S&P affirmed the ratings
on the remaining classes from various ARC transactions.
The downgrades and negative CreditWatch placements reflect
realized losses that have exceeded monthly excess interest cash
flow, thereby reducing overcollateralization. As a result, O/C
levels for these transactions have dropped to at least 38% below
their respective targets. Furthermore, loss projections indicate
that the current performance trends may further compromise credit
support for these classes. In addition, these transactions have
sizeable loan amounts that are severely delinquent (90-plus days,
foreclosures, and REOs), which suggests that the unfavorable
performance trends are likely to continue. The severe
delinquencies relative to O/C are as follows:
-- 2001-BC5: $7,783,223 in delinquencies versus $730,921 in
O/C (target O/C is $1,448,111);
-- 2002-BC4: $10,303,375 in delinquencies versus $1,971,616
in O/C (target O/C is $3,325,460);
-- 2002-BC7: $17,772,450 in delinquencies versus $2,047,164
in O/C (target O/C is $3,310,137);
-- 2002-BC8: $27,077,753 in delinquencies versus $3,844,878
in O/C (target O/C is $6,343,090);
-- 2002-BC9: $14,780,311 in delinquencies versus $1,837,637
in O/C (target O/C is $3,369,395);
-- 2002-BC10: $9,574,693 in delinquencies versus $1,725,936
in O/C (target O/C is $3,209,598); and
-- 2004-1: $24,344,804 in delinquencies versus $82,612 in O/C
(target O/C is $2,991,354).
As of the May 2007 remittance report, cumulative realized losses
for the lowered transactions, as a percentage of the original pool
principal balances (series: percent, amount) were:
-- 2001-BC5: 2.21%, $12,850,455;
-- 2002-BC4: 1.96%, $13,942,880;
-- 2002-BC7: 2.33%, $19,292,736;
-- 2002-BC8: 1.76%, $22,437,616;
-- 2002-BC9: 1.75%, $11,828,528;
-- 2002-BC10: 1.54%, $9,935,539; and
-- 2004-1: 1.18%, $7,109,584
S&P removed the rating on class M2 from series 2001-BC5 from
CreditWatch negative because S&P lowered it to 'CCC'. According
to Standard & Poor's surveillance practices, ratings lower than
'B-' on classes of certificates or notes from RMBS transactions
are not eligible to be on CreditWatch negative.
The ratings placed on or remaining on CreditWatch negative reflect
high percentages of serious delinquencies in the mortgage pools.
Credit support may be compromised if these trends continue and
results in increased realized losses.
Standard & Poor's will closely monitor the performance of the
transactions with ratings on CreditWatch. If monthly net losses
subside realized losses do not significantly increase, S&P will
affirm the ratings and remove them from CreditWatch. Conversely,
if realized losses continue to stress O/C or subordination, we
will take additional negative rating actions.
S&P removed the rating on class M1 class from series 2001-BC1 from
CreditWatch negative because realized losses have declined and
current O/C is at its target balance.
The affirmations reflect credit support levels that are sufficient
to maintain the current ratings.
Credit support for these transactions is provided by
subordination, O/C, and excess interest cash flow. The collateral
for these transactions includes 30-year subprime, fixed- or
adjustable-rate mortgage loans that are secured by first liens on
one- to four-family residential properties.
Ratings Lowered and Placed on Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2002-BC7 M5 BBB/Watch Neg A
2002-BC7 M6 BBB-/Watch Neg A-
2002-BC7 B1 BB/Watch Neg BBB+
2002-BC8 M3 BB/Watch Neg BBB+
2002-BC10 M2 BB-/Watch Neg A
2002-BC10 M3 B+/Watch Neg BBB+
2004-1 B1 B/Watch Neg BB+
Ratings Lowered and Remain on Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ---- -- ----
2001-BC5 M1 B/Watch Neg BB/Watch Neg
2002-BC4 B1 BB-/Watch Neg BBB-/Watch Neg
2002-BC7 B2 B/Watch Neg BBB/Watch Neg
2002-BC7 B3 B/Watch Neg BBB-/watch Neg
2002-BC8 M4 BB-/Watch Neg BBB/Watch Neg
2002-BC9 M4 BB/Watch Neg BBB/Watch Neg
2002-BC9 B BB-/Watch Neg BB/Watch Neg
Rating Lowered
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2004-1 B2 CCC BB
Rating Lowered and Removed from Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2001-BC5 M2 CCC B/Watch Neg
Rating Placed On Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2002-BC4 M3 BBB/Watch Neg BBB
Ratings Affirmed and Removed from Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2001-BC1 M1 A A/Watch Neg
Ratings Remaining on Creditwatch Negative
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Series Class Rating
------ ----- ------
2002-BC5 M3 BBB/Watch Neg
2002-BC6 B BBB-/Watch Neg
Ratings Affirmed
Amortizing Residential Collateral Trust
Mortgage pass-through certificates
Series Class Rating
------ ----- ------
2001-BC1 A1 AAA
2001-BC5 A-1, A-2 AAA
2001-BC6 A AAA
2001-BC6 M1 AA+
2001-BC6 M2 A
2002-BC1 A AAA
2002-BC1 M1 AA+
2002-BC1 M2 A
2002-BC1 B BBB
2002-BC2 A AAA
2002-BC2 M1 AA+
2002-BC3 A AAA
2002-BC3 M1 AA+
2002-BC3 M2 A+
2002-BC3 B1 BBB-
2002-BC4 A AAA
2002-BC4 M1 AA+
2002-BC4 M2 A+
2002-BC5 M1 AAA
2002-BC5 M2 AA-
2002-BC6 A1, A2, A4 AAA
2002-BC6 M1 AA+
2002-BC6 M2 A+
2002-BC6 M3 BBB
2002-BC7 A1, M1 AAA
2002-BC7 M2 AA+
2002-BC7 M3 AA
2002-BC7 M4 AA-
2002-BC8 A1, A3 AAA
2002-BC8 M1 AA+
2002-BC8 M2 A+
2002-BC9 M1 AA+
2002-BC9 M2 A+
2002-BC9 M3 BBB+
2002-BC10 A4 AAA
2002-BC10 M1 AA
2004-1 A2, A5 AAA
2004-1 M1 AA+
2004-1 M2 AA
2004-1 M3 AA-
2004-1 M4 A+
2004-1 M5 A
2004-1 M6 A-
2004-1 M7 BBB+
2004-1 M8 BBB
2004-1 M9 BBB-
AMP'D MOBILE: Seeks Court OK to Use Kings Road Cash Collateral
--------------------------------------------------------------
Amp'd Mobile Inc. asks the U.S. Bankruptcy Court for the
District of Delaware for authority to use the cash collateral
securing repayment of its obligations to Kings Road Investment
Ltd.
The Debtor tells the Court that it borrowed money from Kings Road
pursuant to a convertible secured promissory note dated April 2,
2007, for $30,000,000. Amp'd Mobile believes Kings Road's liens
and security interests are valid, perfected, enforceable and
constitute first priority liens and security interests in all of
its assets except its intellectual property.
Faced with a growing liquidity crisis, Amp'd Mobile attempted to
raise additional funds from its existing equity and debt holders
throughout May 2007. The company's existing investors, however,
declined to further fund the business.
On May 22, 2007, Amp'd Mobile received a notice of default from
Verizon Wireless. Amp'd Mobile was given 10 days to make a cure
payment exceeding $4,500,000 or face terminate of their 2005
Wholesale Agreement.
Over the next 10 days, Amp'd Mobile engaged in numerous and
lengthy negotiations with Verizon, Kings Road, and its equity
investors to resolve the unpaid account receivable and to obtain
favorable terms for the deferral of anticipated usage.
On the morning of June 1, 2007, having failed to reach any
agreement that would result in immediate cash infusion, Amp'd
Mobile's board of directors resolved to seek bankruptcy
protection to preserve the Wholesale Agreement and to work with
Kings Road toward a financing facility that would allow the
Debtor the requisite time to restructure its obligations.
Later in the evening of June 1, 2007, prior to the expiration of
the cure period and while it Amp'd Mobile was finalizing its
Chapter 11 petition, Verizon sent a letter purporting to
preemptively terminate the Wholesale Agreement, effective
immediately and before the expiration of the 10-day cure period.
Because of the uncertainty created by Verizon's move, Kings Road
halted negotiations concerning a postpetition loan facility until
the Verizon dispute is resolved.
"Currently, the Debtor has no available cash or assets readily
convertible to cash that are not subject to [Kings Road's] liens
and security interests," Bill Stone, Amp'd Mobile's president,
relates.
As a result, Mr. Stone says, Amp'd Mobile requires the use of
Kings Road's cash collateral to pay its necessary operating
expenses, and to preserve and increase the value of its assets
for the benefit of all creditors and parties-in-interest.
Amp'd Mobile needs to use the Cash Collateral to fund payroll,
pay vendors and suppliers, and meet other on-going business
obligations, Mr. Stone explains. Specifically, between June 1
and 15, 2007, Amp'd Mobile expects to make these cash
disbursements:
Projected Cash Disbursements
From June 1 to June 15, 2007
Payroll and benefits $1,258,000
Billing, Collections Reserve 1,780,000
Content, Marketing and Sales 255,000
Legal fees 500,000
Financial Advisory fees 250,000
Foreign Subsidiaries 75,000
----------
$4,118,000
Amp'd Mobile also seeks permission to grant Kings Road adequate
protection with respect to the Debtor's use of Cash Collateral
and any diminution in the value of Kings Road's Collateral.
Kings Road will receive a lien on the Debtor's assets, including
avoidance actions and intellectual property. Kings Road will
also get a superpriority claim pursuant to Section 364(c)(1).
Kings Road's superpriority claim, however, will be subject to a
carve-out for unpaid bankruptcy court clerk fees and U.S. Trustee
fees under 28 U.S.C. Sections 1930(a) and (b); and payment of
bankruptcy professionals' fees not to exceed $200,000 in the
aggregate.
Amp'd Mobile and Kings Road have nearly completed negotiations
concerning the terms of the Debtor's use of Cash Collateral, Mr.
Stone relates.
Headquartered in Los Angeles, Calif., Amp'd Mobile Inc. aka
Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual
network operator that provides voice, text and entertainment
content to subscribers who contract for cellular telephone
service. The company filed for chapter 11 protection on June 1,
2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq.,
Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard
Firm represent the Debtor in its restructuring efforts. When it
sought bankruptcy, Amp'D Mobile listed total assets of between
$1 million to $100 million and estimated debts of more than
$100 million.
(Amp'd Mobile Bankruptcy News, Issue No. 1; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
AMP'D MOBILE: Verizon Wireless Objects to Cash Collateral Use Plea
------------------------------------------------------------------
Bonnie Glantz Fatell, Esq., at Blank Rome LLP, in Wilmington,
Delaware, tells the U.S. Bankruptcy Court for the District of
Delaware that Amp'd Mobile, Inc., intends to use up to $4,118,000
of cash collateral to fund litigation with Cellco Partnership,
doing business as Verizon Wireless, and pay a portion of the
Debtor's anticipated costs of administration.
Amp'd Mobile intends to seek an adjudication from the Court that
the Wholesale Agreement remains in full force and effect. Amp'd
Mobile has demanded that Verizon Wireless continue to provide
services pending outcome of the litigation, with no concomitant
assurances of payment.
Ms. Fatell asserts that Verizon Wireless validly terminated its
wholesale agreement with Amp'd Mobile before the bankruptcy
filing. Ms. Fatell also contends that Amp'd Mobile's Cash
Collateral Motion is inappropriate for a host of reasons and
should be denied.
Amp'd Mobile's request and the proposed budget fail to provide
for or contemplate the payment of postpetition expenses that may
become owing to Verizon Wireless, Ms. Fatell explains. To the
extent Verizon Wireless provides postpetition services to the
Debtor on credit, Verizon Wireless likely will be the largest
administrative creditor in the case, Ms. Fatell says.
"Verizon Wireless should not be forced to bear the risk of the
Debtor's reorganization efforts . . . given the prospect that
th[e] case is or will become administratively insolvent," Ms.
Fatell says.
Verizon Wireless is entitled to assurances that it will be paid
for any and all postpetition services provided on credit, Ms.
Fatell maintains. Any order authorizing Amp'd Mobile's use of
cash collateral should require the Debtor to make weekly
prepayments for Verizon Wireless' benefit based on anticipated
usage, Ms. Fatell asserts.
Ms. Fatell also contends that Amp'd Mobile's budget is wholly
inadequate as it fails to include basic information, like whether
the budget is cash or accrual based, and the sources and amounts
of the Debtor's revenues. The budget also improperly affords
Kings Road the ability to approve or deny, in its discretion, the
payment of postpetition expenses.
The proposed use of cash collateral is scheduled to terminate
July 20, 2007, unless terminated earlier based on a termination
event or extended by agreement of the Debtor and Kings Road.
Amp'd Mobile plans to make certain transfers to its foreign
subsidiaries without adequate disclosure or justification, Ms.
Fatell adds. The Debtor must adequately describe or justify
those payments.
The proposed Interim Cash Collateral Order purports to grant
replacement liens on avoidance actions and other unencumbered
assets and related proceeds without an adequate showing of
exigent circumstances, Ms. Fatell points out. Kings Road, Ms.
Fatell contends, is not entitled to protections afforded to
postpetition lenders under Section 364 of the Bankruptcy Code.
Moreover, avoidance actions are not property of the bankruptcy
estate, but rather rights that may be exercised for the benefit
of the Debtor's creditors.
"[T]he proposed replacement liens on avoidance actions and other
unencumbered causes of action are improper given that such claims
may be available to the Debtor's estate. Indeed, such claims may
represent the only source of recovery for unsecured creditors in
this case," Ms. Fatell says.
Headquartered in Los Angeles, Calif., Amp'd Mobile Inc. aka
Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual
network operator that provides voice, text and entertainment
content to subscribers who contract for cellular telephone
service. The company filed for chapter 11 protection on June 1,
2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq.,
Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard
Firm represent the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it listed total
assets between $1 million to $100 million and estimated debts of
more than $100 million.
(Amp'd Mobile Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ASARCO LLC: Court Okays Bid Procedures for Salt Lake Property Sale
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas has
approved the bidding procedures to govern the sale of ASARCO LLC's
real property in Salt Lake City, Utah, to Western States Loding,
LLC.
All Qualifying Bids must be submitted on or before June 15, 2007,
to Tom Aldrich, Ruth Kern, Jack Gracie, Baker Botts, LLP, and
Reed Smith, LLP.
Any party who wants to submit a Competing Offer must accompany
that offer with a $76,000 good faith deposit, which will be wired
to First American Title Insurance Agency, LLC, as the escrow
agent.
If one or more Qualifying Bids are received, an auction will be
conducted on June 20, 2007, at the offices of NAI Utah Commercial
Real Estate, Inc., at 343 East 500 South, in Salt Lake City,
Utah.
During the Auction, bidding will begin with the highest
Qualifying Bid and subsequently continue in minimum increments of
at least $10,000 higher than the previous bid.
If no bid is received other than the bid submitted by Western
States, then a sale hearing will be held on June 29, 2007.
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. 47; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
ASARCO LLC: Wants Toxic Tort Claims Procedures Established
----------------------------------------------------------
ASARCO LLC and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of Texas to establish
procedures for the handling of omnibus objections to proofs of
claims relating to their alleged toxic tort, non-asbestos
liabilities and the estimation of certain Toxic Tort Claims.
Approximately 850 Toxic Tort Claims have been filed against the
Debtors aggregating approximately $1,470,000,000, Jack L. Kinzie,
Esq., at Baker Botts, LLP, in Dallas, Texas, tells the Court.
The Toxic Tort Claims include allegations of traditional toxic
tort, personal injury, environmental property damage and related
breach-of-settlement claims. Most of the Toxic Tort Claims fall
into three categories of claims:
(1) The "Tar Creek Claims" consist of numerous claims asserted
by individual claimants, local governmental entities and
the Quapaw Indian Tribe alleging personal injury, lead
contamination, and property damages resulting from the
Debtors' operations of a site in Tar Creek, Oklahoma. The
Tar Creek Claims aggregates to approximately
$1,030,000,000.
(2) The "Amparano Claims" consist of 243 claims asserted by
plaintiffs in a class action lawsuit alleging property
damage and personal injuries from the Debtors' operations
of the Ray Mine and the Hayden Smelter located in Ray
Complex, Arizona. The class action lawsuit was dismissed
without prejudice for want of venue in 2003 and no class
was certified. After the Amparano Lawsuit was dismissed,
the Debtors filed a lawsuit, seeking declaratory and
injunctive relief. The Debtors' Lawsuit was dismissed for
want of prosecution in 2005 after the Petition Date. The
Amparano Claims aggregate $340,000,000. The putative
class representative filed a class claim for $25,000,000.
(3) The "El Paso Smelter Claims" consist of 80 claims asserted
by plaintiffs in a number of lawsuits alleging personal
injury and property damage as a result of the Debtors'
operations of the El Paso Smelter located in El Paso,
Texas. The El Paso Smelter Claims aggregate approximately
$12,000,000.
Mr. Kinzie tells the Court that a number of toxic tort claims do
not state the amount sought and some of them are duplicative.
Some toxic tort claims were also settled before the Petition Date
so that those claims are already liquidated and need not be part
of the estimation process, Mr. Kinzie adds.
The Debtors cannot formulate a plan of reorganization without
first determining the amount of their contingent, asbestos,
environmental and other toxic tort liabilities, Mr. Kinzie
asserts. The Debtors have already entered case management orders
for the estimation of their asbestos and several of their
environmental liabilities.
The Debtors seek to engage in a two-tier process for addressing
the Toxic Tort Claims, according to Mr. Kinzie.
Phase 1 will consist of the filing of omnibus objections to the
duplicative, amended or superseded, and no-liability Toxic Tort
Claims. The Debtors anticipate that omnibus objections to claims
will fall under these categories:
* Wrong debtor claims
* No liability claims
* Undetermined claims
* Late filed claims
* Amended claims
* Duplicate claims
* No information claims
If any of the claims subject to the omnibus objections are later
determined to be unliquidated, then the Debtors may seek to
include those claims in the estimation process.
Phase 2 will consist of the Bankruptcy Court or a district court
estimating the amount of the Debtors' liability for the remaining
Toxic Tort Claims. Phase 2 will include the submission of expert
reports, legal briefing, and a hearing on the estimated total
amount of the Toxic Tort Claims and the methodology to be used in
arriving at that estimate. The Debtors welcome the participation
of the Official Committees appointed in their bankruptcy cases
and the Future Claims Representative in Phase 2.
A 15-page list of the Toxic Tort Claims for estimation is
available for free at:
http://researcharchives.com/t/s?20ac
The Debtors, however, do not have the complete information on the
Toxic Tort Claims. The Debtors propose to revise the chart to
include or remove claims as more information about the Claims
becomes available.
The Debtors propose that Phase 1 and Phase 2 be conducted
simultaneously, so that the estimation process is not delayed
during the resolution of the omnibus claim objections.
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. 47; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
ASSET BACKED: Moody's Junks Rating on Class B-1A & M-4 Certs.
-------------------------------------------------------------
Moody's Investors Service downgraded two certificates originated
by Long Beach Mortgage Company, issued in 1999 and 2003.
The underlying collateral pools for these deals consist of
adjustable and fixed rate residential mortgage loans.
The most subordinate class in the 1999-LB1 transaction has been
downgraded based on the low credit enhancement levels compared to
the loss projections. The existing credit enhancement level on
the transaction does not provide adequate protection to support
the rating on the most subordinate class.
The most subordinate class in the 2003-1 transaction has been
downgraded because existing credit enhancement levels may be low
given the current projected losses on the underlying pools.
Overcollateralization has declined due to both stepdown and
losses, and in addition, the severity of loss on liquidated loans
has begun to increase.
Complete rating action is:
Downgrades:
* Issuer: Asset Backed Securities Corp, Long Beach Home
Equity Loan Trust
-- Series 1999-LB1; Class B-1A, downgraded to Caa1 from B1;
* Issuer: Long Beach Mortgage Loan Trust
-- Series 2003-1; Class M-4, downgraded to Caa3 from B1.
ATLAS PIPELINE: Inks Pact to Buy Anadarko's Chaney/Midkiff Assets
-----------------------------------------------------------------
Atlas Pipeline Partners L.P. signed definitive agreements to
acquire control of Anadarko Petroleum Corporation's interests in
the Chaney Dell and Midkiff/Benedum natural gas gathering and
processing systems for $1.85 billion, subject to customary closing
conditions and other adjustments. The transaction has been
unanimously approved by the Board of Directors of the Partnership
and is expected to close on or about July 11, 2007, subject to
certain approvals.
The acquisition is immediately accretive. Available distributable
cash flow to the Partnership is projected to be approximately
$2.14 to $2.22 per unit for the second half of 2007, representing
a 6-10% increase compared with prior guidance, and $4.56 to $4.80
per unit in 2008. APL expects to distribute between $1.78 and
$1.85 per limited partner unit in the second half of 2007, and
expects to distribute between $3.80 to $4.00 per limited partner
unit in 2008, after an increase in its distribution coverage ratio
to 1.2x. At the mid-point of this range, this payout would
represent over a 13% increase over the Partnership's current
distribution rate of $0.86 per quarter, or $3.44 on an annualized
basis.
"This purchase is transformative for APL," said Edward E. Cohen,
Chairman and Chief Executive Officer of the Partnership. "APL's
aggregate processing capacity will more than double - from 350
million cubic feet per day to over 750 Mmcf/d, and current total
cash flow should nearly triple following this transaction. In
addition, these new assets offer considerable opportunity for
further rapid and substantial organic growth."
Chaney Dell
The Chaney Dell natural gas gathering and processing system,
currently 100% owned by Anadarko, is located in northwest Oklahoma
and southern Kansas, near the center of the Anadarko Basin.
Throughput on the Chaney Dell system averaged 226 Mmcf/d in 2006,
and is centered within an active drilling area.
This system consists of two active processing facilities:
* the Waynoka Plant, a 200 Mmcf/d cryogenic unit in Woods
County, Oklahoma;
* the Chester Plant, a 30 Mmcf/d cryogenic expander unit in
Woodward County, Oklahoma; and
* approximately 3,470 miles of gathering pipeline covering six
counties in the Anadarko Basin across northwestern Oklahoma
and southern Kansas
Midkiff/Benedum
The Midkiff/Benedum natural gas gathering and processing system,
which is approximately 73% owned by Anadarko, is located in the
Spraberry Trend of the Permian Basin, near Midland, Texas. In
2006, the Midkiff/Benedum system had approximately 139 Mmcf/d of
average throughput.
This system consists of:
* the Midkiff Plant, a 130 Mmcf/d cryogenic facility in Reagan
County, Texas;
* the Benedum Plant, a 43 Mmcf/d cryogenic facility in Upton
County, Texas; and
* approximately 2,500 miles of gathering pipeline located
across four counties in the Permian Basin of west Texas
The Midkiff/Benedum system is subject to a third-party's
preferential right, the exercise of which, if any, would occur
prior to the expected closing. The information in this release
assumes no exercise of the preferential right.
In order to offer greater flexibility to its customers and expand
its operating footprint related to its Oklahoma assets, APL
expects to take advantage of the location of its existing Elk
City-Sweetwater gathering and processing system in southwest
Oklahoma by connecting these facilities to the Chaney Dell system.
Additionally, APL plans to construct a new processing facility
between the Elk City-Sweetwater system and the Chaney Dell system.
All of these planned strategies should materially benefit cash
flow past 2008.
Robert R. Firth, President of Atlas Pipeline Holdings, general
partner of APL, added, "We anticipate the opportunity to create
operating flexibility by assimilating these processing and
gathering assets into our existing systems. Also, these assets
are strategically placed in the Anadarko and Permian Basins which
have seen significant drilling activity, and this will allow us to
expand these systems to meet the growing production demands in
these areas. Lastly, we expect to benefit from substantial capital
improvements that the previous owner invested in these assets in
late 2006."
Transaction Highlights
* $1.85 billion for control of Anadarko's interests in the
Chaney Dell system (100% owned by Anadarko) and the
Midkiff/Benedum system (approximately 73% owned by
Anadarko), subject to certain adjustments and subject to
certain legal rights of the minority shareholder in the
Midkiff/Benedum system.
* APL expects to receive the equivalent of a stepped up tax
basis in the acquired assets.
* Acquisition financing fully committed through:
* a private placement to institutional investors of
$1.125 billion, consisting of approximately
25.6 million limited partner units of APL at $44.00 per
unit;
* up to a $900 million term loan, which matures in 2014;
and
* a $250 million revolving credit facility, from which it
expects to draw approximately $60 million for the
closing.
* APL intends to hedge its commodity exposure to natural gas
and natural gas liquid prices on incremental production
volumes from this transaction. The Partnership expects to
hedge approximately 80% of its projected processing volumes
from the date of the transaction through June 2010.
* Upon execution of this transaction, the company's general
partner, Atlas Pipeline Holdings, L.P. (NYSE:AHD), holder of
all the incentive distribution rights in APL, will allocate
a portion of its future incentive distribution rights to APL
once specified distribution levels are met in this manner:
* up to $5 million per quarter for the first 8 quarters
immediately following the closing of the transaction;
and
* up to $3.75 million per quarter after the initial 8
quarter period.
Pro forma impact on Atlas Pipeline
* APL anticipates that its cash distributions to common
unitholders will be approximately $1.78 to $1.85 for the
second half of 2007, and between $3.80 and $4.00 per common
unit for full year 2008.
* Available distributable cash flow to the Partnership is
expected to be approximately $2.14 to $2.22 per unit for the
second half of 2007, and between $4.56 and $4.80 per unit in
2008.
* Beginning in the third quarter of 2007, Atlas Pipeline
intends to increase its targeted coverage ratio
(distributable cash flow to distributions declared) to
approximately 1.2x.
* Atlas Pipeline expects its total natural gas processing
capacity to increase from approximately 350 Mmcf/d to
approximately 750 Mmcf/d
Affiliates of the Partnership and Anadarko will effect the
transaction through the creation of two separate joint ventures
which will own the respective systems.
Wachovia Securities acted as sole financial advisor and provided
commitments for the Partnership's new revolving credit facility
and term loan financing arrangements. UBS Investment Bank acted
as sole private placement agent.
About Atlas Pipeline Partners
Atlas Pipeline Partners, L.P. --
http://www.atlaspipelinepartners.com/-- is active in the
transmission, gathering and processing segments of the midstream
natural gas industry. In the Mid-Continent region of Oklahoma,
Arkansas, northern Texas and the Texas panhandle, the Partnership
owns and operates approximately 1,900 miles of active intrastate
gas gathering pipeline and a 565-mile interstate natural gas
pipeline. The Partnership also operates three gas processing
plants and a treating facility in Velma, Elk City, Sweetwater and
Prentiss, Oklahoma where natural gas liquids and impurities are
removed. In Appalachia, it owns and operates approximately 1,600
miles of natural gas gathering pipelines in western Pennsylvania,
western New York and eastern Ohio.
Atlas Pipeline Holdings, L.P. is a limited partnership formed to
own and control Atlas Pipeline Partners GP, LLC, the general
partner of Atlas Pipeline Partners, L.P., through which it owns a
2% general partner interest, all the incentive distribution rights
and 1,641,026 common units of Atlas Pipeline Partners
ATLAS PIPELINE: Moody's May Cut Low-B Ratings After Review
----------------------------------------------------------
Moody's Investors Service placed the ratings of Atlas Pipeline
Partners, L.P. under review for possible downgrade following its
announced acquisition of Anadarko Petroleum Corporation's
interest in natural gas gathering and processing systems located
in Oklahoma and West Texas for $1.85 billion.
Ratings under review include Atlas' B1 Corporate Family Rating and
the B2 rating on its 8.125% senior unsecured notes due 2015.
The ratings review is prompted by:
(i) the leveraging effects of the acquisition even though
approximately 60% of the purchase price is expected to be
funded through a private placement of $1.125 billion of
equity;
(ii) risks and uncertainties associated with integrating an
acquisition of this size and executing on planned
improvements; and
(iii) the complexity of the transaction itself which includes
the creation of two separate joint ventures with Anadarko
that could result in structural subordination and other
issues.
The ratings review also is driven by higher leverage than what was
expected at the time ratings were initially assigned in December
2005 as well as the increasing complexity of the Atlas group of
entities, which have been active in terms of
transactions recently.
In addition, the rating on Atlas' 8.125% senior unsecured notes
could be double-notched if a significant amount of secured debt
becomes a permanent part of the capital structure.
In its review, Moody's will consider all of the above as well as
the benefits of increased size and scale associated with the
acquisition. Also, Moody's will evaluate Atlas' post-acquisition
plans for the assets and its financial policies with respect to
leverage and managing distribution growth.
Atlas Pipeline Partners, L.P. is headquartered in Moon Township,
Pennsylvania.
AVAYA INC: Silver Lake Merger Deal Cues S&P to Lower Rating to B+
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Basking Ridge, New Jersey-based Avaya Inc. two notches
to 'B+', and placed the rating on CreditWatch with negative
implications.
The CreditWatch placement follows the announcement that Avaya has
entered into a definitive merger agreement with Silver Lake and
TPG Capital for approximately $8.2 billion or $17.50 per common
share. The purchase price is a premium of approximately 28% over
Avaya's closing share price on May 25, 2007.
"While the terms of the acquisition have not been announced, the
lowering of the corporate credit rating reflects our view that
operating lease- and pension-adjusted leverage likely will
increase dramatically from current levels slightly above 2x, given
the market's current tolerance for heightened debt leverage," said
Standard & Poor's credit analyst Ben Bubeck.
The lowering of the corporate credit rating to 'B+' is likely an
interim step. "As we have the opportunity to review the proposed
capital structure, and the financial and operating strategies of
the new owners, ratings could be further lowered," said Mr.
Bubeck.
BARE ESCENTUALS: Debt Reduction Cues S&P to Lift Rating to B+
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating and senior secured bank loan rating on San Francisco-based
Bare Escentuals Beauty Inc. to 'B+' from 'B'.
At the same time, Standard & Poor's affirmed the '2' recovery
rating on the company's first-lien credit facility, indicating the
expectation for substantial (80%-100%) recovery of principal in
the event of a payment default. The outlook is stable.
The upgrade reflects continued improvement in credit protection
measures, driven by ongoing debt reduction and strong operating
performance through the first quarter of 2007," said Standard &
Poor's credit analyst Mark Salierno.
Following the completion of its IPO in October 2006, the company
applied a substantial portion of proceeds from the offering to
significantly reduce debt levels. In the first quarter of 2007,
the company reduced debt levels by an additional $14 million. For
the last 12 months ended April 1, 2007, lease adjusted total debt
to EBITDA has further improved to about 2.1x, compared to a pro
forma leverage ratio just above 3x immediately following the IPO.
The ratings on Bare Escentuals reflect the company's narrow
product focus and participation in the highly competitive and
fragmented cosmetics industry, relatively small sales base, the
risks associated with expanding and upgrading its operating
platforms, and a historically aggressive financial policy. These
factors are somewhat offset by the company's strong market
position in the mineral-based cosmetics segment of the cosmetics
industry.
BEAR STEARNS: Fitch Puts Low-B Ratings on Three Cert. Classes
-------------------------------------------------------------
Fitch Ratings upgrades Bear Stearns Commercial Mortgage Securities
Inc., commercial mortgage pass-through certificates, series 2000-
WF1:
-- $8.9 million class F to 'AAA' from 'AA';
-- $15.5 million class G to 'A+' from 'A-';
-- $13.3 million class H to 'BBB+' from 'BBB'.
In addition, these classes are affirmed:
-- $455 million class A-2 at 'AAA';
-- $41.1 million class A-1 at 'AAA';
-- Interest-only class X at 'AAA';
-- $31.1 million class B at 'AAA';
-- $35.5 million class C at 'AAA';
-- $8.9 million class D at 'AAA';
-- $26.6 million class E at 'AAA';
-- $6.7 million class I at 'BBB-';
-- $5.6 million class J at 'BB';
-- $8.9 million class K at 'B';
-- $3.3 million class L at 'B-'.
Fitch does not rate the $3.3 million class M.
The rating upgrades reflect the improved credit enhancement levels
resulting from loan payoffs, scheduled amortization and the
defeasance of an additional 13 loans (7.5%) since Fitch's last
rating action. In total 47 loans (43.5%) have defeased, including
the largest loan in the pool, 650 Townsend Center (8.2%).
As of the May 2007 distribution report, the pool's aggregate
certificate balance was reduced 25.3% to $663.7 million from
$888.3 million at issuance. There are no delinquent or specially
serviced loans.
BCE INC: Largest Shareholder Joins Bidding War, Buys More Shares
----------------------------------------------------------------
The Ontario Teachers' Pension Plan, BCE Inc.'s largest
shareholder, and its U.S. partner Providence Equity Partners Inc.
confirmed that Teachers' Private Capital, the plan's private
investment arm, have signed non-disclosure and standstill
agreements with BCE, officially entering in the bidding race in
taking BCE private.
As reported in the Troubled Company Reporter on May 28, 2007, BCE
is reviewing two potential bidders that are confirmed to be in
privatization talks are:
* a group led by the Canada Pension Plan Investment Board,
along with the Caisse de depot et placement du Quebec and the
New York buyout firm, Kohlberg Kravis Roberts; and
* a group led by the New York private equity firm Cerberus
Capital Management LP, along with the Hospitals of Ontario
Pension Plan. Some reports say OPTrust and CanWest Global
Communications are also part of the consortium.
As previously reported, Pacific Century Group, an investment group
controlled by billionaire Richard Li, is in discussions to join
the Cerberus Capital consortium.
The review is currently expected to be completed in the third
quarter of 2007.
Additional Stock Purchase
Ontario Teachers bought an additional 8.02 million BCE shares for
CDN$316.6 million ($299.1 million), according to a regulatory
filing.
Originally owning 5.3% shares as of April 9, 2007, Ontario
Teachers now owns 6.3% shares, various sources disclose. Ontario
Teachers' stake in BCE is worth about CDN$1.98 billion.
Deborah Allan, Ontario Teachers' spokeswoman, said that the stock
purchase was for "investment purposes."
Headquartered in Montreal, Canada, Bell Canada International Inc.
(TSX, NYSE: BCE) (NEX:BI.H) -- http://www.bci.ca/-- provides a
suite of communication services to residential and business
customers in Canada. Under the Bell brand, the company's services
include local, long distance and wireless phone services, high-
speed and wireless Internet access, IP-broadband services,
information and communications technology services and direct-to-
home satellite and VDSL television services. Other BCE businesses
include Canada's premier media company, Bell Globemedia, and
Telesat Canada, a pioneer and world leader in satellite operations
and systems management.
The company is operating under a Plan of Arrangement approved by
the Ontario Superior Court of Justice, pursuant to which BCI
intends to monetize its assets in an orderly fashion and resolve
outstanding claims against it in an expeditious manner with the
ultimate objective of distributing the net proceeds to its
shareholders and dissolving the company.
BEST BRANDS: Weak Performance Prompts S&P to Cut Rating to B-
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Minnetonka, Minnesota-based Best Brands Corp. by one notch,
including its corporate credit rating on the company, from 'B' to
'B-'.
The ratings remain on CreditWatch with negative implications where
they were placed on April 20, 2007, reflecting concerns about the
company's operating performance and liquidity.
Total debt outstanding at Best Brands at Feb. 3, 2007, was about
$237 million.
"The downgrade reflects Best Brands' weaker-than-expected
performance and expected limited covenant cushion over the near
term," said Standard & Poor's credit analyst Alison Sullivan. "We
believe the company will not meet our expectations of achieving
leverage under 6x at December 2006-- though 2006 audits have not
been completed yet."
The company has received a waiver and first amendment to its
credit facility that waived late delivery of financial statements,
and adjusted EBITDA and debt calculations for covenant purposes.
As a result, immediate liquidity issues have been mitigated.
"However," said Ms. Sullivan, "we remain concerned that covenant
cushion could be very limited in the first half of 2007."
CreditWatch with negative implications means that the ratings
could be affirmed or lowered following the completion of Standard
& Poor's review. "We will review Best Brands' operating and
financial plans with management, as well as monitor the status of
covenant compliance and any potential need for further amendments,
before resolving the CreditWatch listing," said Ms. Sullivan.
BRISTOW GROUP: Amends Pact to Increase Credit Facility to $325MM
----------------------------------------------------------------
Bristow Group Inc., on May 17, 2007, amended its:
(i) Revolving Credit Agreement dated as of Aug. 3, 2006, among
the company, the several banks and other financial
institutions and lenders , SunTrust Bank, as
administrative agent, JPMorgan Chase Bank, N.A. as
syndication agent, and Wells Fargo Bank, N.A. as
documentation agent and
(ii) Letter of Credit Facility Agreement dated as of Aug. 3,
2006, among the company, the several banks and other
financial institutions and lenders , SunTrust Bank, as
administrative agent, JPMorgan Chase Bank, N.A. as issuing
bank and syndication agent, and Wells Fargo Bank, N.A. as
documentation agent.
The amendments to the Credit Agreement and the Letter of Credit
increase the amount of permitted additional indebtedness under
such agreements from $200 million to $325 million.
About Bristow Group Inc.
Headquartered in Houston, Texas, Bristow Group, Inc. --
http://www.bristowgroup.com-- (NYSE:BRS), fka Offshore Logistics,
Inc., provides helicopter transportation services to the worldwide
offshore oil and gas industry with operations in the United States
Gulf of Mexico and the North Sea. The Company also has operations,
both directly and indirectly, in offshore oil and gas producing
regions of the world, including Australia, Brazil, China, Mexico,
Nigeria, Russia and Trinidad. The Company also provides production
management services for oil and gas production facilities in the
United States Gulf of Mexico.
* * *
As reported in the Troubled Company Reporter on June 6, 2007,
Standard & Poor's Ratings Services assigned its 'BB' rating to
helicopter service company Bristow Group Inc.'s $250 million
senior notes due 2017. At the same time, Standard & Poor's
affirmed the 'BB' corporate credit rating and all other ratings on
the company. The outlook is negative.
BROMONT PAVILION: Merrill Lynch to Sell Collateral on June 12
-------------------------------------------------------------
Merrill Lynch Capital will be selling at a June 12, 2007 auction
the collateral provided to it as security under separate
agreements with Bromont Pavilion GPLP Master LLC, Bromont
Cotenancy LLC and Pavilion Co-Tenancy LLC.
The auction will be held at the offices of Barack Ferrazzano
Kirschbaum Perlman & Nagelberg LLP, Suite 3900, 200 W. Madison
Street, in Chicago, Ill.
The collateral relates to a promissory note the Bromont entities
entered into with Merrill Lynch on July 30, 2004, in the
original principal amount of $19,400,892.
The Bromont entities are in default under the note.
The total amount due under the note as of April 12, 2007,
including principal, interest, and other fees and charges, is
$82,906,215.
For further information regarding the sale, contact:
Barack Ferrazzano Kirschbaum Perlman & Nagelberg LLP
Suite 3900
200 W. Madison Street
Chicago, IL 60606
Tel: (312)984-3100
CBRL GROUP: Completes Redemption & Conversion of Convertible Notes
------------------------------------------------------------------
CBRL Group, Inc. has completed successfully the redemption and
conversion of its Liquid Yield Option(TM) Notes due 2032 (CUSIP
Nos. 12489VAB2 and 12489VAA4) and its Zero Coupon Senior
Convertible Notes due 2032 (CUSIP No. 12489VAC0).
The redemption and conversion was for $46,099,000 aggregate
principal amount at maturity -- approximately $22.0 million
accreted value -- of Old Notes and $375,931,000 aggregate
principal amount at maturity -- approximately $179.5 million
accreted value -- of New Notes that previously were outstanding.
The Notes will be settled for approximately $189 million in cash,
plus approximately 276,000 shares issued for Old Notes, plus a yet
to be determined number of shares for the New Notes -- which would
range from approximately 95,000 to 264,000 shares if the
applicable share price were to range from $45 to $47. The shares
issued in settlement of the Notes compare with an approximately
4.6 million dilutive share effect that the Notes generally had
prior to the redemption and conversion, and the company reiterated
its present intention to repurchase those shares along with other
authorized repurchases.
Holders of Notes in an aggregate principal amount at maturity of
$1,074,000 elected to be redeemed and, accordingly, the company
has deposited with the respective trustees of the Old Notes and
the New Notes an aggregate of $512,738, reflecting a redemption
price of $477.41 per $1,000 in principal amount at maturity. All
remaining Notes were converted, with the exception of $20,000,000
in principal amount at maturity of Old Notes that were purchased
by the company in a private transaction under terms financially
equivalent to the conversions.
As a result of the conversion and purchase of Notes, the company
will pay approximately $189 million in cash and issue, in addition
to the 276,000 shares issued for the Old Notes, an as yet to be
determined number of shares of common stock immediately following
the ten-day averaging periods used in valuing the New Notes. The
ten-day averaging periods will end between June 13 and June 15
depending on actual conversion dates for New Notes. At average
share prices of $45.00, $46.00 and $47.00 the number of shares
issued pursuant to the net share settlement feature of the New
Notes would be, respectively, approximately 95,000, 181,000, and
264,000, subject also to cash settlement in lieu of fractional
shares. These shares, and the approximately 276,000 shares to be
issued in connection with the conversion of Old Notes, are the
only remaining dilutive effects of the Old Notes and the New
Notes. Before the redemption and conversion, the Notes generally
had a dilutive impact of approximately 4.6 million shares.
As previously announced, the company is authorized and presently
intends to repurchase shares issued in connection with conversion
of the Notes, in addition to 821,800 shares that it was previously
authorized to repurchase. The company presently has in place a
10b5-1 plan to effect an initial 500,000 share repurchases, and
expects to enter into additional plans as appropriate to complete
its share repurchase authorizations.
The company will pay the redemption price of the Notes as well as
the purchase price for any shares of common stock that are issued
in connection with a conversion of any Notes through draws on its
existing delayed-draw term loan facility and cash on hand.
About CBRL Group
Based in Lebanon, Tennessee, CBRL Group, Inc. (NASDAQ: CBRL) --
http://www.cbrlgroup.com/-- presently operates 559 Cracker Barrel
Old Country Store(R) restaurants and gift shops located in 41
states.
* * *
CBRL Group Inc.'s Zero-Coupon Senior Liquid Yield Option Notes due
2032 carry Moody's Investors Service's 'Ba2' rating and Standard &
Poor's 'B+' rating.
CELESTICA INC: May Be Next Acquisition Target, Analysts Say
-----------------------------------------------------------
Celestica Inc. is a likely acquisition target after Flextronics
International Ltd.'s move to acquire Solectron Corp., Bloomberg
reports. Flextronics' bid has sparked speculation that there is
likely more consolidation in the industry.
Bloomberg relates, citing Scotia Capital analyst Gus Papageorgiou,
that Celestica is a possible merger target since it has "the
highest potential of being taken out."
Bloomberg further reports that a purchase could assist the company
in a possible return from the red as it has been reporting 15
losses for the past 16 quarters.
According to UBS AG analyst Long Jiang, Bloomberg says that
consolidation in Celestica's industry is long overdue.
Celestica Inc. -- http://www.celestica.com/-- (NYSE:CLS) provides
innovative electronics manufacturing services. Through its global
manufacturing and supply chain network, the company delivers
competitive advantage to companies in the computing,
communications, consumer, industrial, and aerospace and defense
end markets.
* * *
As reported in the Troubled Company Reporter on May 4, 2007,
Moody's Investors Service downgraded Celestica Inc.'s corporate
family rating to B1 from Ba3 and the senior subordinated note
ratings to B3 from B2. Simultaneously, Moody's lowered the
company's speculative grade liquidity rating to SGL-2 from SGL-1.
CHARLES RIVER: Fitch Affirms BB Rating on $4.8 Mil. Class C Notes
-----------------------------------------------------------------
Fitch affirms eight classes of notes issued by Charles River CDO I
Ltd. These affirmations are the result of Fitch's review process
and are effective immediately:
-- $213,878,730 class A-1A notes at 'AAA';
-- $20,000,000 class A-2F notes at 'AA';
-- $14,991,500 class A-1B notes at 'AAA';
-- $15,000,000 class A-2V notes at 'AA';
-- $18,000,000 class B-V notes at 'BBB';
-- $3,000,000 class B-F notes at 'BBB';
-- $4,800,000 class C notes at 'BB';
-- $4,997,166 combination securities at 'AAA'.
Charles River is a collateralized debt obligation, which closed in
November 2002 and is managed by TCW Investment Management Company.
The portfolio consists of residential mortgage-backed securities,
commercial mortgage-backed securities, real estate investment
trust securities, asset-backed securities, and CDOs. Charles
River has exited its reinvestment in December 2006.
Included in this review, Fitch discussed the current state of the
portfolio with the asset manager. In addition, Fitch conducted
cash flow modeling utilizing various default timing and interest
rate scenarios to measure the breakeven default rates going
forward relative to the minimum cumulative default rates required
for the rated liabilities.
Since the last rating action on March 24, 2006, the collateral has
exhibited relatively stable performance.
All overcollateralization and interest coverage tests continue to
meet their corresponding covenants. The Fitch weighted average
rating factor remains at 16 ('BBB'/'BBB-') which is below its
trigger level of 17 ('BBB'/'BBB-'). Additionally, since the
deal's closing in 2002 several combination securities note holders
executed their rights outlined in the Charles River Unit Agreement
to exchange their holdings in combination securities' components
into these components' corresponding classes (A-1B and preferred
shares). As a result, the outstanding balance of the combination
securities has decreased down to 5,000,000 from the original
balance of 15,000,000. The current rated balance of the
combination securities reflects principal amortization through the
A-1B component received by the notes on the December 2006 payment
date.
The ratings of the class A-1A, A-2F, and A-2V notes address the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date. The
ratings of the class B-F, B-V, and C notes address the likelihood
that investors will receive ultimate and compensating interest
payments, as per the governing documents, as well as the stated
balance of the principal by the legal final maturity date. The
rating of the class A-1B and combination securities address the
likelihood that investors will receive ultimate principal
payments, as per the governing documents.
CLONDALKIN INDUSTRIES: Moody's Holds B1 Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service affirmed the B1 Corporate Family Rating
for Clondalkin Industries B.V. and the B3 rating for the
EUR170 million Senior Notes while at the same time assigning a
(P)Ba3 to the proposed Floating Rate Notes due 2013 and upgrading
the rating to Ba3 from B1 on the senior secured bank facilities.
The FRN will be issued in a EUR and USD tranche with an equivalent
face amount of EUR400 million. Clondalkin intends to refinance
its existing senior bank debt and to finance an acquisition for
about EUR81 million. Consequently, Moody's will withdraw the
rating for the senior secured bank facilities once settled with
the proceeds from the FRN. The outlook for all ratings is stable.
"Despite some weakening in its operating performance over the past
three years, Clondalkin is well-positioned in the B1 rating
category, which is supported by its size, increasing
diversification by region, customer and substrates in addition to
the track record of free cash flow generation," said Martin
Kohlhase, Moody's European lead analyst for the packaging
industry. The contemplated acquisition in an industry with
above GDP-growth rates adds about 10% to the group's sales, has a
complementary fit to Clondalkin's existing businesses and is in
line with management's strategy to diversify geographically and
increase its exposure to existing activities. Moody's expects
Clondalkin to complement its existing portfolio with bolt-on
acquisitions as it has done in the past.
"Although the generation of free cash flow slowed in 2006, we
expect to see an acceleration again from a stabilization of
profitability and the end of a two-year period of high capital
investment outlays. The company's ability to pass on increasing
raw material prices and operating improvements, like de-
bottlenecking of capacities and withdrawals from under-performing
activities, should contribute to a recovery of profit
margins and a strengthening of key credit metrics," expressed
Kohlhase when discussing the stable outlook.
The stable outlook also:
(i) considers Moody's expectation that Clondalkin will
smoothly integrate its contemplated acquisition and
(ii) factors in future acquisitions if these are of bolt-on
character.
The (P)Ba3 rating for the FRN due December 2013 reflects the
ranking of the notes in the overall debt structure with only the
EUR30 million revolving credit facility (RCF; not rated) ranking
ahead of the notes in case of enforcement of the security. Both,
the RCF and the FRN are secured with substantially all assets, are
guaranteed by nearly all operating subsidiaries and are issued by
Clondalkin Acquisitions B.V. The existing EUR170 million Senior
Notes due March 2014 have been notched down twice from the CFR
reflecting the security package for the senior debt.
* Issuer: Clondalkin Acquisition B.V.
-- EUR400 million (equivalent) FRN, LGD rate 40%, LGD3,
provisional (P)Ba3 assigned;
-- EUR282 million senior secured bank facilities, LGD rate
36%, LGD3, upgraded to Ba3 from B1, to be withdrawn once
redeemed with the proceeds from the proposed issuance of
the FRN;
* Issuer: Clondalkin Industries B.V.
-- EUR170 million Senior Notes, LGD rate downgraded to
90%, LGD6, from LGD rate 88%, LGD5, B3 rating unchanged
Clondalkin Industries B.V., which is owned by Warburg Pincus Funds
and management, is domiciled in Amsterdam, The Netherlands. The
broad range of flexible product applications include lids and
seals for dairy product containers, flower sleeves, agricultural-
produce bags, papers and foil-paper liners for the tobacco
industry in addition to specialist products that range from
folding cartons, labels and leaflets to paper bags and sacks for
end customers in the pharmaceutical, cosmetics, healthcare and
consumer-goods industries. In fiscal year 2006, the company
recorded sales of EUR763 million (pro forma the 2007 acquisitions:
EUR841 million), which were generated in Europe (78%) and the U.S.
(22%).
COLLINS & AIKMAN: Working to Resolve Soft Trim Sale Objections
--------------------------------------------------------------
Collins & Aikman Corp. and its debtor-affiliates tell the United
States Bankruptcy Court for the Eastern District of Michigan that
they have worked diligently with their major constituents and
objecting parties to resolve consensually all ten of the
objections to the sale of their Carpet & Acoustics or Soft Trim
Business to International Automotive Components Group North
America, Inc.
The Debtors have resolved seven objections as of June 4, 2007, and
are attempting to resolve each remaining objection.
If the objections are not resolved before the hearing on the Sale
approval, the Debtors intend to present facts and argument
sufficient to persuade the Court to overrule the objections. The
Debtors believe that they will have sufficiently addressed each
of the objections by the Sale Hearing and have obtained support
for the Sale by their major constituents.
The Debtors and certain parties agreed to add language in the
Sale Order, resolving certain objections.
Amendment to APA
On May 26, 2007, the Debtors amended the asset purchase agreement
dated April 20, 2007. Ray C. Schrock, Esq., at Kirkland & Ellis
LLP, in New York, states that the APA's modifications include:
* The purchase price is $126,242,500;
* Upon closing, $8,000,000 -- the post-closing funds --
which will be funded from the escrowed funds and a portion
of the purchase price, will be deposited at an account
with LaSalle Bank, as escrow agent, pursuant to an escrow
agreement mutually agreed to by IAC, Collins, and post-
closing escrow agent;
* The property known as 313 Bethany Road, Tract 3,
Albermarle, North Carolina 28127 -- the Lagoon Tract --
will be an "Excluded Asset;"
* At the closing, the Debtors will grant IAC a perpetual
easement over the portion of the Lagoon Tract within which
the existing wastewater line and metering station are
located. The Easement will be depicted in a survey of the
owned real property, other than the Lagoon Properties,
located in Albemarle, North Carolina, and be insured as an
easement appurtenant to the Albemarle properties under
IAC's title insurance policy for the Albemarle Properties;
* If the closing will not have occurred due to the failure
of conditions set forth in Section 10.3(c) or Section
10.3(d) of the APA and if all other conditions to the
respective obligations of the parties to close are capable
of being fulfilled by the "termination date" will have
been fulfilled or waived, then no party may terminate the
APA before October 31, 2007;
* If the closing will not have occurred on or before the
Termination date due to a material breach of any
representations, warranties, covenants or agreements
contained in the APA by IAC or the Debtors, then the
breaching party may not terminate the APA pursuant to
Section 4.4(a); and
* The letter of intent dated November 3, 2006, between Dow
Automotive and Collins, the associated blanket purchase
orders and any releases thereunder that exceed one week in
duration will be designated as Excluded Assets.
Resolved Objections
(a) Inmet Division
Inmet Division of Multimatic and the Debtors have agreed,
subject to Inmet Division's final approval, to include in
the Sale Order language reserving its rights to pursue
recourse to certain of the assets owned by Collins &
Aikman Holdings Canada Inc., or Collins & Aikman Canada
Inc.
(b) Maryland Electric
After negotiations, Maryland Electric Co., Inc., and the
Debtors agreed to include in the Sale Order that the
Debtors will pay $95,283 to Maryland Electric from the
proceeds received from the Sale so as to satisfy the
secured Claim No. 3911. The payment will finally and
completely resolve any claims filed by Maryland Electric
in the Debtors' Chapter 11 cases.
(c) Certain Insurers
After engaging in negotiations with Mt. McKinley; Everest;
Fireman's Fund Insurance Company, National Surety Company;
and members of the ACE Group of Companies, including ACE
American Insurance Company, Westchester Fire Insurance
Company and ACE International Reinsurance Company, Ltd.,
and upon the agreement of the insurers, the Sale Order
will provide that the insurance agreements between the
Debtors and the Insurers will not be assumed and assigned
to the purchaser, and no right in or under the insurance
agreements will be transferred.
(d) Village of Rantoul
The contracts and leases with the Village of Rantoul,
Illinois, listed on the Contract and Cure Schedule were
listed in error and these are not implicated by and are
not being assumed in connection with the Sale.
(e) Rieter
Rieter Automotive North America sought clarification as to
which, if any, of its executory contracts the Debtors
intend to assume and assign in connection with the Sale.
After discussions with the Debtors and conducting an
internal review, Rieter withdrew its objection to the Sale.
GECC's Objection
General Electric Capital Corporation had objected to the proposed
sale of the Carpet & Acoustics Business on the grounds that it is
unable to determine with certainty whether and which of GECC's
assets, contract and leases are included in the proposed Sale,
and what considerations GECC will receive from the Sale if they
are.
GECC and Collins & Aikman Products Co. have entered into a master
lease agreement dated as of August 7, 2001, as amended; master
lease agreement dated as of December 20, 2001, as amended; and
master lease agreement dated as of June 25, 2004, as amended,
pursuant to which GECC leases equipment to C&A Products. GECC
and Becker Group, Inc. entered into a master lease agreement
dated as of May 7, 1993, as amended, pursuant to which GECC
leases equipment to Becker. The Debtors have filed a complaint
against GECC seeking to recharacterize those "leases" as secured
financing agreements pursuant to New York law.
The notice of the Amendment of the APA and the Amendment implies
that GECC assets will be included in the proposed Sale, but does
not identify the specific assets, Erin L. Toomey, Esq., at Foley
& Lardner LLP, in Detroit, Michigan, says.
The Amendment states that a list of GECC leases is attached, but
no exhibit was attached. GECC needs more information about what
assets and leases of GECC, if any, are going to be included in
the Proposed Sale and what consideration GECC will receive for
them if GECC consents to their inclusion in the Proposed Sale,
Ms. Toomey tells the Court.
To the extent that the Proposed Sale of the Debtors' Carpet &
Acoustics Business includes the proposed sale of assets located
in Hermosillo, Mexico, Ms. Toomey states that those assets are
owned by GE Capital de Mexico, S. de R.L. de C.V., and that the
Debtors do not have any right to sell the assets with the consent
of GE Capital de Mexico, S. de R.L. de C.V.
GECC asks the Court to deny the Debtors' request to the extent
the motion seeks to sell assets of GECC or assume and assign
executor contracts or unexpired leases of GECC, unless and until
the Debtors and GECC can reach an agreement on what assets,
contracts or leases of GECC are included in the sale and the
consideration and cure amounts that GECC will receive, and until
the Debtors provide GECC with adequate assurance of the
purchaser's future performance under any GECC contracts and
leases that the Debtors propose to assume and assign to the
purchaser.
To the extent that GECC's objections are not resolve before the
Sale Hearing, the Debtors believe that sufficient justification
exits to overrule the objections. They have indicated to GECC
that they will not assume or assign any of GECC's assets in
connection with the Sale.
The Debtors will amend the Sale Order to sufficiently protect
GECC's rights with respect to any of its assets affected by the
Sale.
Mt. McKinley and Everest's Objection
Mt. McKinley Insurance Company, formerly known as Gibraltar
Casualty Company, and Everest Reinsurance Company, formerly known
as Prudential Reinsurance Company, issued certain historical
liability insurance policies to Gulf + Western Industries, Inc.,
under which the Debtors have in the past or may in the future
claim rights to insurance coverage.
The policies contain provisions, which prohibit the assignment of
the policies without Mt. McKinley's and Everest's consent. The
provisions are intended to protect the benefit of Mr. McKinley's
and Everest's bargain by ensuring that it will not have different
and greater burdens foisted upon it than what they agreed to
insure, Seth D. Gould, Esq., at Wienner & Gould, P.C., in
Rochester, Michigan, says.
The Debtors seek approval of a sale of substantially all of their
Carpet & Acoustics Business. However, the Debtors' intent with
respect to historical insurance policies that potentially covered
the business is less than clear, Mr. Gould relates.
The motion nowhere identifies the particular insurance policies
that are part of the "excluded assets," nor the insurance
policies that are, or are not, considered "assumed contracts"
that will be transferred to a purchaser, Mr. Gould points out.
Mr. Gould asserts that the Court should not approve the motion
insofar as it purports to effect any assignment of Mt. McKinley's
and Everest's insurance policies without their consent.
Upon examination of the Debtors' proposed order, Mr. Gould notes
it seems that not only would Mt. McKinley's and Everest's
policies be assigned to the purchaser without their consent and
in contravention of the policy language and applicable non-
bankruptcy law, but Debtors would have obtained by fiat a
declaration from the Court that the otherwise unlawful assignment
is valid.
Mt. McKinley and Everest ask the Court to deny the Debtors'
request insofar as it purports to, or could be construed to,
assign insurance coverage allegedly provided by Mt. McKinley and
Everest.
Dow Chemical's Objection
The Dow Chemical Company and its subsidiaries and affiliates,
including Dow Chemical Canada Inc., and Dow Quimica Mexicana Sa
De Cv, object to the proposed sale of the Debtors' Carpet &
Acoustics Business, also known as the Soft Trim Group, to
International Automotive Components Group North America, Inc.
TDCC and Collins & Aikman Corporation and certain other Debtors
were parties to numerous contracts as of the Petition Date,
including a sales contract dated January 1, 2005, whereby TDCC
agrees to sell certain resin, polypropylene, polymer, magnum and
other products for shipment to certain of the Debtors in the
operation of their Interior Plastics Group, also known as the
Hard Trim Group.
The Sales Contract is an executory contract in that it was in
effect as of the Petition Date and expires on December 31, 2007,
Anne Marie P. Kelley, Esq., at Dilworth Paxson LLP, in Cherry
Hill, New Jersey, notes.
TDCC filed a $2,684,008 claim with respect to Hard Trim Products
sold and shipped to Collins under the Sales Contract before the
Petition Date.
When the Debtors filed for bankruptcy, TDCC began selling
polyethylene products to certain of the Debtors and certain non-
Debtors that are used in the operation of the Soft Trim Group.
The postpetition sales of the Soft Trim Products were and continue
to be on a cash-in-advance basis.
On November 3, 2006, TDCC and Collins executed a letter of intent
to "confirm the volumes for the Polyethylene products. . . for
the Global Soft Trim Division. . . at [certain] prices." The
Letter of Intent provides that TDCC will continue to supply
products to the new organization, should the Global Soft Trim
Division be bought, sold, or renamed. The LOI also provides that
TDCC agrees to sell a targeted number of pounds of the Soft Trim
Products at certain prices for the period of January 1, 2006,
through December 31, 2008.
On April 20, 2007, the Debtors and IAC executed an asset purchase
agreement whereby, among other things, the Debtors would sell and
transfer certain "Purchased Assets" relating to the Soft Trim
Group to IAC, and the Debtors would retain their interest and
title in certain "Excluded Assets."
The Debtors filed a request for the approval of bidding
procedures in connection with the sale of certain assets of the
Soft Trim Group on the same day, which the Court approved on
May 1.
A contract and cure schedule identifying certain executory
contracts that may be potentially assumed and assigned was filed
on May 4. Neither the Letter of Intent nor any other agreement
with Dow is identified on the Contract and Cure Schedule,
Ms. Kelley tells the Court.
The Debtors filed a certificate of service on May 26 with respect
to a notice of amendment to the APA. Ms. Kelley says that the
Notice of Amendment was not served on Dow or its counsel.
Moreover, there are approximately 60 schedules and seven exhibits
that are to be attached to the APA, which have not been filed
with the Court as of May 31.
Dow is unable to determine which Dow Agreements were being
assumed or if the Dow Agreements are being treated as Excluded
Assets under the APA. In addition, Dow is unable to determine if
and when its obligation to sell the Soft Trim Products to the
Debtors ceases and whether the Debtors or IAC would be entitled
to any prepayments received from the Debtors, Ms. Kelley points
out.
In accordance with the Amendment to the APA, the Debtors seek to
remove from a schedule the Letter of Intent and only "associated
blanket purchase orders and any releases thereunder that exceed
one week in duration. . . ." Presumably, therefore, any blanket
purchase order or release less than one week in duration would be
treated as an Assumed Asset under the APA, Ms. Kelley states.
Ms. Kelley argues that because the Letter of Intent and any
blanket purchase orders and releases must be assumed in their
entirety, the Debtors cannot assume only blanket purchase orders
and releases that are less then one week in duration.
Dow asks the Court to deny the Sale Motion until the Schedules
and Exhibits to the APA are filed. To the extent the Debtors
seek to assume or reject some, but not all, of the Dow Agreements,
Dow asks the Court to grant it relief as the Court deems just and
proper.
The Debtors relate that they do not maintain any prepetition
contracts with Dow relating to the Carpet & Acoustics Business,
and only maintain one postpetition contract with Dow in connection
with the Carpet & Acoustics Business. The Debtors have informed
Dow and its counsel that no Dow contracts will be assumed and
assigned in connection with the Sale.
Anchor Court's Objection
The Debtors have notified Anchor Court, LLC, that they intend to
assume and assign its lease as part of the Sale. The parties have
engaged in discussions regarding the requested repairs and,
subject to receiving an estimate of the costs associated with the
repairs, the Debtors will pay Anchor Court for the repairs as part
of the cure amount.
If the parties cannot agree on the cure amount before the Sale
Hearing, the Debtors ask the Court to approve the assumption and
assignment and hear the cure dispute at the June 21, 2007 hearing.
Anchor Court has entered into a confidentiality agreement
with IAC, which will allow Anchor Court to receive certain
financial information that will provide it with adequate assurance
of future performance by the lease assignee.
About Collins & Aikman
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 July 12,
2007.
(Collins & Aikman Bankruptcy News, Issue No. 63; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
COLLINS & AIKMAN: Subsidiary Not Related to Debtor, Tandus Says
---------------------------------------------------------------
Tandus Group, Inc. has issued a clarification saying that its
wholly owned subsidiary, Collins and Aikman Floorcoverings, Inc.,
is not affiliated with the Collins & Aikman Corporation.
Tandus' subsidiary has been identified with Collins & Aikman
Corporation in recent news articles surrounding its Chapter 11
filing and the resignation of its Chief Executive Officer.
Floorcoverings was an operating unit of Collins & Aikman until
1997 when it was then split off in a sale transaction led by its
executive management team and a private equity sponsor. Since
that time there has been no legal association or business
relationship between the companies and they have operated
independently.
Collins & Aikman Floorcoverings, Inc. markets commercial carpets
under the "C&A Floorcoverings" and "C&A" brand names.
"The confusion caused by such similar company names and some
common history is understandable; however, we want to assure the
marketplace that C&A Floorcoverings is healthy and stronger than
ever," said Len Ferro, Chief Financial Officer of Tandus. "With
the synergies realized by being part of the Tandus Group, C&A is
poised for even greater growth."
About Tandus Group
Based in Dalton, Georgia, Tandus Group Inc. --
http://www.tandus.com/-- creates floorcovering solutions that
enhance spaces for learning, working, healing, and living through
inspired design, leading-edge technology, unprecedented
achievement toward sustainability, and an absolute commitment to
continued leadership.
About Collins & Aikman
Based 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.
CONVERSE INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Converse Industries, Inc.
5601 95th Avenue
Kenosha, WI 53144
Bankruptcy Case No.: 07-24338
Type of Business: The Debtor is a progressive machining services
provider of precision, automated machining and
related services. The company specializes in
CNC milling and turning of a wide range of
alloys and processes in highly technical and
automated manufacturing cells.
See http://www.converseindustries.com/
Chapter 11 Petition Date: June 5, 2007
Court: Eastern District of Wisconsin (Milwaukee)
Judge: Margaret Dee McGarity
Debtor's Counsel: Leonard G. Leverson, Esq.
Leverson & Metz S.C.
225 East Mason Street, Suite 100
Milwaukee, WI 53202
Tel: (414) 271-8500
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's List of its 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
LaSalle Bank Line/Loan $6,593,315
515 East Townline Road Secured:
Vernon Hills, IL 60061 $3,300,000
c/o Linda Weber
Tel: (847) 990-3911
Fax: (312) 904-9340
Earle M. Jorgenson Steel Material $725,901
75 Remittance Drive, Suite 6477
Chicago, IL 60675-6477
c/o Russ Lee
Tel: (847) 301-6100
Fax: (630) 635-1068
Wisconsin Steel Material $601,975
P.O. Box 26365
Milwaukee, WI 53226
c/o Mike Poehlman
Tel: (414) 453-4441
Fax: (414) 453-0789
Colfor-American Axle Material $422,028
Drawer 5897
P.O. Box 79001
Detroit, MI 48279-5897
Tel: (330) 868-1700
Fax: (330) 863-2085
American Express-CC Credit Card $187,091
United Healthcare of Wisconsin Employee Healthcare $158,192
Rotaform LLC Material $115,513
Bank of Kenosha Advance $97,588
Lincoln Industries Sub-Contracting $80,481
Bank of America-CC Credit Card $70,718
Ellison Machinery Co. Equipment Repair $44,375
WE Energies Utility $38,088
Metal Powder Products Canada Material $35,699
WI Plating Works Sub-Contracting $25,937
American Express Business Loan $25,319
Centerpoint Rent $24,312
Columbia Grinding Sub-Contracting $19,631
PDQ Tooling Tooling $19,340
Wisconsin Metal Products Sub-Contracting $17,017
Taylor Made Express Trucking $12,600
CREDIT SUISSE: Fitch Holds Low-B Ratings on Five Certificates
-------------------------------------------------------------
Fitch Ratings-Chicago-05 June 2007: Fitch upgrades three classes
of Credit Suisse First Boston Mortgage Securities Corp.'s
commercial mortgage pass-through certificates, series 2004-C3 as:
-- $45.1 million class B to 'AA+' from 'AA';
-- $14.3 million class C to 'AA' from 'AA-';
-- $28.7 million class D to 'A+' from 'A'.
In addition the ratings on these classes are affirmed:
-- $41.1 million class A-2 'AAA';
-- $209.4 million class A-3 'AAA';
-- $102.9 million class A-4 'AAA';
-- $694.5 million class A-5 'AAA';
-- $330.4 million class A-1-A 'AAA';
-- Interest-only class A-X 'AAA';
-- Interest-only class A-SP 'AAA';
-- $16.4 million class E 'A-';
-- $20.5 million class F 'BBB+';
-- $16.4 million class G 'BBB';
-- $22.5 million class H 'BBB-';
-- $8.2 million class J 'BB+';
-- $6.1 million class K 'BB';
-- $8.2 million class L 'BB-';
-- $6.1 million class M 'B+';
-- $2.1 million class O 'B-'.
The $6.1 million class N and $22.5 million class P are not rated
by Fitch. Class A-1 has paid in full.
The rating upgrades reflect increased credit enhancement due to
14% defeasance and 1.8% paydown since the last Fitch review.
As of the May 2007 distribution date, the pool's aggregate
certificate balance has decreased 2.4% to $1.60 billion from
$1.64 billion at issuance. In total, 11 loans (14.2%) have
defeased, including One Park Avenue (9.6%), a credit assessed
loan.
The Mizner Park building (3.2%) maintains an investment grade
credit assessment. The Mizner Park loan is secured by six mixed-
use buildings (50% office, 50% retail) in Boca Raton, FL. The loan
contains A and B notes, with the A note included in the trust. As
of year-end 2006, the servicer reported debt service coverage
ratio was 2.06 times (x) compared to 2.09x at issuance. First-
quarter 2007 combined occupancy was 91.1%, up from issuance
occupancy of 89%.
Currently there is one asset in special servicing that became real
estate owned in March 2007. The multifamily property (0.90%) is
located in Texas City, Texas, and has a current occupancy of 84%.
The special servicer is marketing the property for sale, and the
nonrated class P is sufficient to absorb the projected losses on
the asset.
CT CDO: Fitch Affirms Low-B Ratings on Six Classes
--------------------------------------------------
Fitch Ratings affirms all classes of CT CDO IV, Ltd.:
-- $303,611,899 class A-1 at 'AAA';
-- $22,085,833 class A-2 at 'AAA';
-- $22,085,833 class B at 'AA';
-- $15,460,626 class C at 'A';
-- $7,075,385 class D-FL at 'BBB+';
-- $4,519,858 class D-FX at 'BBB+';
-- $6,073,785 class E at 'BBB';
-- $2,711,915 class F-FL at 'BBB-';
-- $4,465,620 class F-FX at 'BBB-';
-- $8,834,514 class G at 'BB+';
-- $4,417,709 class H at 'BB';
-- $2,760,729 class J at 'BB-';
-- $6,073,785 class K at 'B+';
-- $5,521,458 class L at 'B';
-- $3,864,478 class M at 'B-'.
Classes N, X and the Preferred Shares classes are not rated by
Fitch.
CT CDO IV is a static cash flow commercial real estate
collateralized debt obligation that closed on March 15, 2006.
The portfolio was originally selected and is monitored by CT
Investment Management Co., LLC. Fitch rates CITMCO 'CSS2-' as a
commercial mortgage special servicer.
The affirmations are due to the stable performance of the
underlying collateral. CT CDO IV has a partial pro rata pay
structure in which principal payments from certain predetermined
collateral are allocated pro rata among outstanding notes. As a
result of this structure, as assets repay, the deal will delever
only slightly, while at the same time, the pool diversity will
decline. As of the April 2007 trustee report, the remaining pro
rata pay collateral is approximately 25% of the total collateral.
Upgrade potential is limited until complete repayment of the pro
rata collateral.
Approximately $44.7 million in collateral has repaid since close;
substantially all repayments were from pro rata collateral. The
notes are collateralized by all or a portion of 45 classes in 35
separate underlying fixed- and floating-rate commercial mortgage-
backed securities (CMBS, 58.3%), commercial real estate CDO
(31.5%) securities, commercial mortgage B-notes (6.7%), and
interest in a CRE mezzanine loan (3.5%). The transaction has
realized no losses since close. Since close 27.7% (13 classes) of
the underlying collateral has been upgraded a weighted average of
3.45 notches while 1.1% (one class) has been downgraded two
notches. Fitch's weighted average rating factor of the underlying
classes is in the 'BBB-/BB+' category. The vintages of the CMBS
and CRE CDO securities range from 1998 to 2006 with an average of
five years seasoning.
The collateral consists of three commercial real estate loans
representing 10.2% of the total collateral. Sotheby's Building
(5.6%) is a B-note secured by a New York City office building 100%
leased to Sotheby's Inc. The servicer reports a 1.44 times debt
service coverage ratio as of December 2006. Cohen Brothers
Portfolio (3.5%) is a mezzanine loan secured by two office
buildings in New York City. The portfolio faces high rollover
risk in 2007 and 2008. The servicer reports a DSCR of 1.25x as of
March 2007. Richmond Square Mall (1.1%) is a B-note
collateralized by a four-anchor mall in Richmond, Indiana. The
servicer reports occupancy of 86.2% and a DSCR of 1.28x as of
September 2006.
Delinquencies in the underlying CMBS and CRE CDO transactions are:
30 days: 0.04%; 60 days: 0.0%; 90+ days: 0.06%; in foreclosure:
0.37%; and real-estate owned (REO): 0.24%.
DELPHI CORP: Inks $55.6 Million Sale Deal for Catalyst Business
---------------------------------------------------------------
Delphi Corporation and certain of its affiliates entered into a
sale and purchase agreement with Umicore for the sale of its
global OE and aftermarket catalyst business. Subject to the terms
and conditions of the agreement, the aggregate purchase price for
the assets related to the catalyst business is $55.6 million,
subject to adjustments.
As part of Delphi's transformation plan, which was reported on
March 31, 2006, Delphi identified the catalyst business as a
non-core business line that would be better positioned within
another firm.
As required under the U.S. Bankruptcy Code, Delphi filed a motion
with the U.S. Bankruptcy Court for the Southern District of New
York requesting a hearing on June 26, 2007, to approve bidding
procedures, and a hearing on Aug. 16, 2007, to approve the sale of
assets.
Following the completion of the bidding procedures process,
including a potential competitive auction, the sale is subject to
court approval and other closing conditions, such as certain
competition approvals, completion of consultation procedures with
certain unions and works councils, and completion of the closing
documents. Delphi anticipates the sale closing during the third
quarter of 2007.
As outlined in the motion filed with the U.S. Bankruptcy Court,
under the sale and purchase agreement between Delphi and Umicore,
Umicore will acquire substantially all of these assets:
-- machinery and working capital;
-- related technology and intellectual property;
-- manufacturing facilities in Tulsa, Oklahoma; Florange,
France; Port Elizabeth, South Africa; and certain licensing
agreements (with Varroc Ltd.) for the Indian market for two-
and three-wheeled vehicles;
-- in connection with the sale, Umicore will also hire certain
employees of the catalyst business it acquires from Delphi;
-- in addition, Delphi and Umicore will enter into component
supply agreements, and transitional toll manufacturing
and/or service arrangements for operations in Shanghai,
China; Clayton, Australia; San Luis Potosi, Mexico; the
Flint Technical Center in Flint, Michigan; and the
Luxembourg Technical Center in Bascharage, Luxembourg.
Delphi will carefully manage the transition of the business and
the sale will be completed in coordination with Delphi's
customers, employees, unions and other stakeholders.
The catalyst, which includes a ceramic substrate coated with
precious metals, is located inside a catalytic converter. The
catalytic converter facilitates the chemical reactions that change
engine exhaust emissions (primarily hydrocarbons, carbon monoxide
and oxides of nitrogen), collected in the exhaust manifold, into
water vapor, carbon dioxide and nitrogen. Catalytic converters
make vehicles more environmentally friendly and help meet tailpipe
emissions requirements.
Although the company is selling its catalyst business, it will
continue to provide full engine management systems, including air
and fuel management, combustion and valvetrain technology, and
exhaust systems technology through its gas EMS product business
unit.
About Umicore
Based in Brussels, Belgium, Umicore NV SA is a materials
technology group. Its activities are centered on four business
areas: Advanced Materials, Precious Metals Products and Catalysts,
Precious Metals Services and Zinc Specialties. Each business area
is divided into market-focused business units.
The Umicore Group has industrial operations on all continents and
serves a global customer base and currently employs some 17,000
people.
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.
FAITH UNLIMITED: Case Summary & 10 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Faith Unlimited Ministries Outreach Center, Inc.
P.O. Box 870144
Stone Mountain, GA 30087
Bankruptcy Case No.: 07-68954
Type of Business: The Debtor is a religious organization.
Chapter 11 Petition Date: June 5, 2007
Court: Northern District of Georgia (Atlanta)
Judge: C. Ray Mullins
Debtor's Counsel: Sims W. Gordon, Jr., Esq.
Gordon & Boykin
1180 Franklin Road, Southwest, Suite 101
Marietta, GA 30067
Tel: (770) 612-2626
Total Assets: $2,813,300
Total Debts: $694,133
Debtor's List of its 10 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Dekalb County Zoning Zoning Violation $4,492
330 West Ponce de Leon Avenue
Suite 500
Decatur, GA 30030-3221
Dekalb County Sanitation Service $3,482
Sanitation Division
3643 Campo Circle
Decatur, GA 30032
Church Mutual Insurance Property Insurance $1,363
4210 198th Street Southwest
Lynnwood, WA 98036
BellSouth Telephone Service $1,278
MX Energy Utility Service $1,123
Taylor, Busch, Slipakoff & Duma Legal Fees $1,000
City of Atlanta Utility Service $477
BellSouth Telephone Service $276
City of Augusta Public Works Utility Service $226
Georgia Power Electric Service $320
FIRST BANCORP: Board Declares $0.07 Per Share Dividend
------------------------------------------------------
First BanCorp's board of directors has declared the next payment
of dividends on Common, Series A through E Preferred and Trust
Preferred I & II shares. Common stockholders of record as of
June 15, 2007, will receive the 48th consecutive quarterly
dividend payment declared by First BanCorp's board, in the amount
of $0.07 per share for the 2nd Quarter of 2007, payable on
June 29, 2007.
The estimated dividend amounts per share, record dates and payment
dates for the Series A through E Preferred Shares are:
Series $ Per share Record Date Payment
Date
A 0.1484375 June 28, 2007 July 2, 2007
B 0.17395833 June 15, 2007 July 2, 2007
C 0.1541666 June 15, 2007 July 2, 2007
D 0.15104166 June 15, 2007 July 2, 2007
E 0.14583333 June 15, 2007 July 2, 2007
Approval was obtained as a part of First agreement with the board
of governors of the Federal Reserve System.
First BanCorp (NYSE: FBP) is the parent corporation of FirstBank
Puerto Rico, a state chartered commercial bank with operations in
Puerto Rico, the Virgin Islands and Florida; of FirstBank
Insurance Agency; and of Ponce General Corporation. First BanCorp,
FirstBank Puerto Rico and FirstBank Florida, formerly UniBank, the
thrift subsidiary of Ponce General, all operate within U.S.
banking laws and regulations. The Corporation operates a total of
151 financial services facilities throughout Puerto Rico, the U.S.
and British Virgin Islands, and Florida. Among the subsidiaries of
FirstBankPuerto Rico are Money Express, a finance company; First
Leasing and Car Rental, a car and truck rental leasing company;
and FirstMortgage, a mortgage origination company. In the U.S.
Virgin Islands, FirstBank operates First Insurance VI, an
insurance agency; First Trade, Inc., a foreign corporation
management company; and First Express, a small loan company.
* * *
In February 2007, Fitch Ratings has affirmed First BanCorp's long-
term Issuer Default Rating of 'BB' and Individual rating of 'C/D'
and removed the Rating Watch Negative. The Rating Outlook is
Negative. Fitch placed the ratings of First BanCorp on Rating
Watch Negative on Oct. 30, 2006. At the same time, Fitch is
affirming the IDR and short-term rating of FBP's subsidiary,
FirstBank of Puerto Rico at 'BB' and 'B', respectively. The
Rating Outlook remains Negative.
FIRST HORIZON: Fitch Puts B Rating on Negative Watch
----------------------------------------------------
Fitch Ratings has taken the following ratings actions on the First
Horizon Home Loan Mortgage Trust issue :
Series 2006-AA2:
-- Class A affirmed at 'AAA';
-- Class B1 affirmed at 'AA';
-- Class B2 affirmed at 'A';
-- Class B3 affirmed at 'BBB';
-- Class B4 affirmed at 'BB';
-- Class B5 rated 'B', placed on Rating Watch Negative.
The mortgage loans consist of conventional 15- and 30-year fixed-
rate mortgages extended to prime borrowers and are secured by
first liens on one- to four-family residential properties. As of
the May 2007 distribution date, the transaction is 14 months
seasoned and the pool factor (i.e., current mortgage loans
outstanding as a percentage of the initial pool) is 0.69%. This
transaction is serviced by First Horizon Home Loan Corporation,
currently rated 'RPS2' by Fitch.
The affirmations reflect credit enhancement consistent with future
loss expectations and affect approximately $184.7 million of
outstanding certificates. All classes in the transactions
detailed above have experienced small to moderate growth in CE
since closing, and there have been no collateral losses to date.
The class B5 that has been placed on Rating Watch Negative shows
signs of increasing credit risk and affects approximately
$1.09 million of outstanding certificates.
The 60+ delinquencies are 2.46% of current collateral balance.
This includes foreclosures and real estate owned (REO) of 0.82%
and 0.55%, respectively. The credit enhancement for the B-1, B-2,
B-3 and B-4 classes is 4.09%, 2.71%, 1.7% and 0.98%, respectively.
FLEXTRONICS INT'L: Solectron Bid Prompts Fitch's Negative Watch
---------------------------------------------------------------
Following the announcement by Flextronics International Ltd.
(Nasdaq: FLEX) of its agreement to acquire Solectron Corp. (NYSE:
SLR) (Issuer Default Rating [IDR] of 'BB-' on Rating Watch
Positive by Fitch) for $3.6 billion in a combination of cash and
stock, Fitch has placed Flextronics' ratings on Rating Watch
Negative:
-- Issuer Default Rating at 'BB+';
-- Senior Unsecured credit facility at 'BB+';
-- Senior subordinated notes at 'BB';
Fitch's action affects approximately $1.5 billion of total debt.
Fitch's decision to place Flextronics' ratings on Negative Watch
reflects the expectation that the company will have higher
leverage, considerable integration risk and future cash
restructuring costs following the close of its proposed
transaction with Solectron. Flextronics will pay up to 50% of the
total consideration ($1.8 billion) for Solectron in cash and will
likely redeem Solectron's $600 million of senior and subordinated
notes outstanding due to change of control provisions.
To facilitate this transaction, Flextronics has obtained a
$2.5 billion seven-year senior unsecured term loan commitment
which the company may use to finance the transaction, although the
ultimate capitalization structure of the combined company has not
been determined. Fitch anticipates that if the company were to
fully draw the term loan in this transaction, pro forma leverage
(debt to operating EBITDA) would be approximately 3 times (x) and
upwards of 4x on an adjusted debt basis, which includes
capitalized operating leases and off-balance sheet accounts
receivable sales. Fitch anticipates resolving the Negative Watch
once the acquisition closes at which time, under the
aforementioned leverage assumptions, Fitch anticipates that
Flextronics' ratings would be lowered one notch.
Flextronics proposed acquisition of Solectron remains subject to
customary closing conditions including regulatory and shareholder
approval, but is anticipated to close before the end of calendar
2007. Solectron shareholders have an option to receive either
cash or stock in lieu of their shares, however total cash
consideration is limited to a minimum of 30% and a maximum of 50%
of total consideration. Flextronics expects it will take 18 to 24
months after closing to fully integrate Solectron's operations and
fully benefit from the operational synergy and anticipated costs
savings from future restructurings. Fitch estimates that the $3.6
billion acquisition price is equivalent to approximately 10.7x
Solectron's latest twelve month EBITDA.
Liquidity as of March 31, 2007 was solid and consisted of:
i) $715 million in cash and cash equivalents; and
ii) a $2.0 billion senior unsecured revolving credit facility,
which was entered into on May 10, 2007 and replaced a
$1.35 billion credit facility which was undrawn as of March 31.
Flextronics also utilizes an off-balance sheet accounts receivable
securitization program as well as one-time A/R sales for
additional liquidity.
Total debt as of March 31, 2007 was $1.5 billion and consisted of:
-- $8 million in short-term debt including credit facilities
and the current portion of capital leases;
-- $195 million in zero coupon convertible junior subordinated
notes due 2009;
-- $500 million in 1% convertible subordinated notes due 2010;
-- $400 million in 6.5% senior subordinated notes due 2013;
-- $389 million in 6.25% senior subordinated notes due 2014;
-- $8 million in other long-term debt.
Flextronics also had $428 million outstanding under its trade
receivables securitization program and $399 million in uncollected
receivable sales.
FLOORPLAN ABS: Fitch Puts BB+ Ratings on Two Classes of Securities
------------------------------------------------------------------
Fitch Ratings affirms these classes of dealer floorplan asset-
backed securities programs following completion of an annual
review of all outstanding dealer floorplan transactions rated by
Fitch:
CNH Wholesale Master Note Trust
Series 2005-1:
-- Class A 'AAA';
-- Class B 'A+'.
Series 2006-1:
-- Class A 'AAA';
-- Class B 'A'.
DaimlerChrysler Master Owner Trust
Series 2004-B:
-- Class A 'AAA'.
Series 2005-A:
-- Class A 'AAA'.
Series 2005-C:
-- Class A 'AAA'.
Series 2006-A:
-- Class A 'AAA'.
Ford Credit Floorplan Master Owner Trust A
Series 2004-1
-- Class A 'AAA';
-- Class B 'A'.
Series 2005-1
-- Class A 'AAA';
-- Class B 'A'.
Series 2006-3:
-- Class A 'AAA';
-- Class B 'A'.
Series 2006-4:
-- Class A 'AAA';
-- Class B 'A'.
GE Dealer Floorplan Master Note Trust
Series 2004-2:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB+';
-- Class D 'BBB'.
Series 2005-1:
-- Class A 'AAA';
-- Class C 'BBB'.
-- Class B 'A';
Series 2005-2:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB'.
Series 2006-1:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB'.
Series 2006-2:
-- Class A 'AAA';
-- Class C 'BBB'.
-- Class B 'A';
Series 2006-3:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB'.
Series 2006-4:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB'.
Superior Wholesale Inventory Financing Trust VIII
Series 2003-A:
-- Term Notes 'AAA';
-- Certificates 'A+'.
Series 2004-A:
-- Term Notes 'AAA'.
Superior Wholesale Inventory Financing Trust IX
Series 2004-A:
-- Term Notes 'AAA';
-- Certificates 'A+'.
Superior Wholesale Inventory Financing Trust X
Series 2004-A:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB'.
Superior Wholesale Inventory Financing Trust XI
Series 2005-A:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB+';
-- Class D 'BB+'.
Superior Wholesale Inventory Financing Trust XII
Series 2005-A:
-- Class A 'AAA';
-- Class B 'A';
-- Class C 'BBB+';
-- Class D 'BB+'.
Series 2005-B
-- Class A 'AAA'.
Fitch recently completed an annual portfolio review of the U.S.
dealer floorplan ABS sector providing commentary on the lifetime
performance of 25 transactions rated by Fitch. Each transaction
is performing as originally expected resulting in no rating
actions. Despite this, Fitch believes the highly competitive U.S.
vehicle sales market and weaker corporate debt ratings of U.S.
Manufacturers will continue to lead to a challenging environment
for the auto dealer floorplan sector.
GENCORP INC: S&P Rates Proposed $280 Mil. Bank Financing at BB-
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings, including
the 'B+' corporate credit rating, on GenCorp Inc.
At the same time, Standard & Poor's assigned its 'BB-' bank loan
rating and '1' recovery rating to the propulsion provider's
proposed $280 million bank financing, indicating high expectations
of a full recovery of principal following payment default.
The outlook is stable.
"The ratings on GenCorp reflect a weak financial profile, driven
by high leverage and poor profitability, limited diversity, and a
modest scale of operations compared with competitors," said
Standard & Poor's credit analyst Christopher DeNicolo. "These
factors are offset somewhat by solid niche positions in aerospace
propulsion and significant real estate holdings."
The company's Aerojet unit, which accounts for almost all
revenues, is a leading provider of solid and liquid propulsion for
missiles and space launch vehicles. Sacramento, California-based
GenCorp also holds substantial real estate in various stages of
the rezoning and entitlement process. Some of the real estate is
subject to environmental restrictions and is undergoing varying
stages of remediation. The revenues from this unit are lumpy as
parcels are sold or leased.
Although much smaller following the sale of its GDX automotive
unit in 2004 and of the fine chemicals business in 2005, GenCorp
is now able to focus on its core aerospace propulsion operations.
Acquisitions in recent years have significantly expanded Aerojet's
operations and improved its position in the space propulsion and
tactical missile markets. Further acquisitions in the propulsion
area are unlikely following the sale of Boeing Co.'s Rocketdyne
unit to Pratt & Whitney in 2005. Firm, funded backlog was
approximately $630 million at Feb. 28, 2007, about one year's
revenues.
The renegotiation of the Atlas V contract and a generally
favorable environment for defense spending should result in
improved profitability and cash generation at Aerojet. If
operating performance at Aerojet does not improve as expected, the
outlook could be revised to negative. Overall, credit protection
measures will remain weak, but should strengthen modestly over the
next two years. The impact on the ratings or outlook from any
real estate transactions will depend on the size and use of
proceeds.
GENERAL MOTORS: Davis and Marinello Elected to Board of Directors
-----------------------------------------------------------------
General Motors Corp. Chairman and Chief Executive Officer Rick
Wagoner disclosed the election of Erroll B. Davis, Jr. and Kathryn
V. Marinello to the GM Board of Directors and the re-election of
the current members of the GM Board. The election of Messrs.
Davis and Marinello brings the number of board members to 13, of
whom 12 are independent, outside directors.
Mr. Davis is chancellor of the University System of Georgia and a
former chairman and chief executive officer of Alliant Energy
Corporation. He has also held corporate finance positions at
Xerox Corporation and Ford Motor Company. He serves on the boards
of BP plc, PPG Industries, Inc. and Union Pacific Corporation.
Ms. Marinello is president and chief executive officer of Ceridian
Corporation. She was previously president and chief executive
officer of GE Fleet Services and, prior to that, of GE Capital's
Consumer Financial Services business. She has extensive
experience in financial services, marketing and operations,
including positions at First Data Corporation, U.S. Bank Card
Services, Chemical Bank, Citibank and Barclays.
"We are extremely pleased to welcome Erroll and Kathy to the GM
Board of Directors," Mr. Wagoner said. "They will bring valuable
insights based on their extensive business experience."
In addition to his business experience, Mr. Davis serves on the
boards of trustees of Carnegie Mellon University and of the
University of Chicago. He was elected to the board of directors
of the U.S. Olympic Committee in 2004 and chairs its audit
committee. Mr. Davis earned a bachelor of science in electrical
engineering from Carnegie Mellon University and an MBA in finance
from the University of Chicago.
Ms. Marinello is a member of the Business Roundtable and serves on
the boards of directors of the Greater Twin Cities United Way and
the Minnesota Business Partnership. She holds a bachelor's degree
in liberal arts from the State University of New York at Albany
and an MBA from Hofstra University.
"We are delighted to welcome Erroll and Kathy to the board, and we
look forward to working with them on the important issues facing
our company," George Fisher, presiding director and chairman of
the board's Directors and Corporate Governance Committee, said.
Mr. Davis and Ms. Marinello will both serve on the Public Policy
and Investment Funds Committees. In addition, Director Armando M.
Codina will move from the Investment Funds Committee to the
Directors and Corporate Governance Committee, effective
immediately.
Headquartered in Detroit, GM General Motors Corp. (NYSE: GM) --
http://www.gm.com/-- was founded in 1908, GM employs about
280,000 people around the world. With global manufactures its
cars and trucks in 33 countries. In 2006, nearly 9.1 million GM
cars and trucks were sold globally under the following brands:
Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
* * *
As reported in the Troubled Company Reporter on May 28, 2007,
Standard & Poor's Ratings Services placed General Motors Corp.'s
corporate credit rating at B/Negative/B-3.
At the same time, Moody's Investors Service affirmed GM's B3
Corporate Family Rating and B3 Probability of Default Rating, and
maintained its SGL-3 Speculative Grade Liquidity Rating. The
rating outlook remains negative.
GENERAL MOTORS: CEO Faces Criticism Despite Progress Report
-----------------------------------------------------------
General Motors Corp. Chief Executive Rick Wagoner continues to
face criticism from shareholder activists over the performance of
management and directors despite his report on the automaker's
progress in its turnaround effort, John D. Stoll of The Wall
Street Journal reports.
According to WSJ, a group of shareholders spoke out on issues
facing the company, including the ability of the board to oversee
the creation of a sustainable business model after two years of
deep losses and the company's effectiveness in addressing
accounting weaknesses.
Mr. Wagoner, the Journal says, is positive that GM will hit its
$9 billion cost-cut target this year while boosting revenue in
most of its markets.
Commenting on GM's labor deal with Delphi Corp., Mr. Wagoner
said the list of issues the company is sorting through with
Delphi is narrowing.
"We're moving very well on a path that our shareholders should
feel good about," WSJ cited Mr. Wagoner as saying.
Headquartered in Detroit, GM General Motors Corp. (NYSE: GM) --
http://www.gm.com/-- was founded in 1908, GM employs about
280,000 people around the world. With global manufactures its
cars and trucks in 33 countries. In 2006, nearly 9.1 million GM
cars and trucks were sold globally under the following brands:
Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
* * *
As reported in the Troubled Company Reporter on May 28, 2007,
Standard & Poor's Ratings Services placed General Motors Corp.'s
corporate credit rating at B/Negative/B-3.
At the same time, Moody's Investors Service affirmed GM's B3
Corporate Family Rating and B3 Probability of Default Rating, and
maintained its SGL-3 Speculative Grade Liquidity Rating. The
rating outlook remains negative.
GLUTH BROS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Gluth Bros. Construction, Inc.
1151 Lake Avenue
Woodstock, IL 60098
Bankruptcy Case No.: 07-71375
Type of Business: The Debtor is a construction project contractor.
Chapter 11 Petition Date: June 5, 2007
Court: Northern District of Illinois (Rockford)
Judge: Manuel Barbosa
Debtor's Counsel: Robert R. Benjamin, Esq.
Querrey & Harrow, Ltd.
175 West Jackson Boulevard, Suite 1600
Chicago, IL 60604
Tel: (312) 540-7000
Fax: (312) 540-0578
Estimated Assets: $3,214,430
Estimated Debts: $8,150,879
Debtor's List of its 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Frank Gluth Loans from 2002-2007 $3,622,318
14217 Davis Road
Woodstock, IL 60098
American Community Bank Secured Indebtedness $1,991,000
1290 Lake Avenue Secured:
P.O. Box 1720 $959,160
Woodstock, IL 60098
Mid American Water Goods and Services $554,490
1819 North Dot Street
P.O. Box 511
McHenry, IL 60051-0511
Graber Concrete Pipe Goods and Services $468,057
24 West 121 Army Trail Road
Bloomingdale, IL 60108
Resource Utility Supply Goods and Services $119,049
Tonyan Bros. Inc. Goods and Services $94,995
Citibank Goods and Services $83,351
Kasper Trucking, Inc. Goods and Services $82,150
Central Boring Inc. Subcontractors and $81,477
Material Supply Claims
HD Supply Waterworks Ltd. Goods and Services $68,571
Fox Valley Laborers Fringe Unions Claims $61,022
Petroliance LLC Goods and Services $57,858
Welch Bros. Inc. Goods and Services $50,731
West Bend Mutual Insurance Goods and Services $37,496
Meyer Material Company Goods and Services $37,034
Valley Block & Supply Co. Goods and Services $35,800
LaFarge Fox River, Inc. Goods and Services $34,823
Valley Aggregates, Ltd. Goods and Services $33,745
Raycraft-Pitel Septic Inc. Goods and Services $31,045
McHenry County Goods and Services $29,200
GUGGENHEIM STRUCTURED: Fitch Holds BB Rating on $10MM Class F Debt
------------------------------------------------------------------
Fitch affirms all classes of Guggenheim Structured Real Estate
Funding 2005-2, Limited and Guggenheim Structured Real Estate
Funding 2005-2, LLC:
-- $5,000,000 class S fixed-rate at 'AAA';
-- $163,800,000 class A floating-rate at 'AAA';
-- $31,300,000 class B floating-rate at 'AA';
-- $27,300,000 class C deferrable interest floating-rate at
'A';
-- $22,543,000 class D deferrable interest floating-rate at
'BBB';
-- $10,700,000 class E deferrable interest floating-rate at
'BBB-';
-- $10,000,000 class F fixed-rate at 'BB'.
Guggenheim 2005-2 is a revolving commercial real estate cash flow
collateralized debt obligation that closed on Aug. 25, 2005. As
of the May 2007 trustee report and based on Fitch categorization,
the CDO was substantially invested as :
-- commercial mortgage whole loans/A-notes (8.2%),
-- B-notes (34.5%),
-- commercial real estate mezzanine loans (25.4%),
-- bank loans to real estate operating companies (REBLs;
20.1%), and
-- commercial mortgage-backed securities (CMBS;11.8%).
The CDO is also permitted to invest in credit tenant lease loans
and commercial real estate CDO securities.
The portfolio is selected and monitored by Guggenheim Structured
Real Estate Advisors, LLC. Guggenheim 2005-2 has a five-year
reinvestment period during which, if all reinvestment criteria are
satisfied, principal proceeds may be used to invest in substitute
collateral. The reinvestment period ends in August 2010.
Collateral Asset Manager:
Guggenheim Structured Real Estate, through its two private equity
funds, is a private investor in commercial real estate debt,
specializing in high-quality income-producing US properties with
experienced sponsorship. GSRE funds are managed by GSREA. Both
the funds and GSREA are affiliated with Guggenheim Partners, LLC,
a diversified financial services firm with more than 525 employees
and over $125 billion of assets under supervision. The two GSRE
equity funds have over $1.1 billion of private equity and have
made approximately $6.0 billion of investments. None of the
funds' investments have had losses or delinquencies.
Fitch rates GSREA as a 'CAM2' U.S. Commercial Real Estate CDO
Asset Manager. GSREA has ten experienced real estate and
investment professionals on staff, three of whom have prior
commercial real estate loan workout experience. GSREA benefits
from its affiliation with GP with respect to real estate markets
information flow, CDO administration, and back office support.
Generally, GSRE investments are serviced by rated CMBS servicers.
Performance Summary:
Guggenheim 2005-2 closed and became effective on Aug. 25, 2005.
Since Fitch's last review in August 2006, the as-is poolwide
expected loss has improved slightly to 22.125% from 22.750%. The
CDO has above average reinvestment flexibility relative to other
CRE CDOs with 15.875% of cushion based on the modeled stressed PEL
of 38.00%. Although PEL cushion is above average, the pool's
weighted average spread and weighted average coupon are considered
tight with 0.20% and 0.30% cushion, respectively. The Fitch PEL
is a measure of the hypothetical loss inherent in the pool at the
'AA' stress environment before taking into account the structural
features of the CDO liabilities. Fitch PEL encompasses all loan,
property, and poolwide characteristics modeled by Fitch.
The improvement in the as-is PEL is primarily due to an increase
in holdings of senior secured real estate banks loans, which now
comprise 20.1% of the CDO. Since Fitch's last review, the CDO has
added two real estate bank loans, Intrawest (8.9%) and General
Growth Properties (1.2%), and increased its position in the Toys
'R' Us senior secured credit facility to 10.0% of the portfolio.
The Trizec Credit Facility (1.7%) repaid in full in October 2006.
As of the last review, the securities and bank loans of the
CDO, which have grown to 31.8% from 21.7% of the portfolio, have a
better weighted average rating factor compared to August 2006, and
remain in the 'BB-/B+' rating category.
Additionally, the CDO added two commercial real estate loan assets
(10.2%): the junior mezzanine position of the Lord & Taylor
portfolio (5.3%) and the third mezzanine position in the
Kyo-Ya/Cerberus portfolio (4.9%), replacing three assets that have
repaid since the last review. The repaid assets include the
Viceroy Hotel, the Marriott Waikiki, and One Beacon Street. Most
of the weighted average expected losses by property type remained
flat since the last review. The Fitch modeled expected loss for
the office properties, however, increased as a result of the
repayment of One Beacon Street, a high quality 34-story office
tower located in Boston. The overall weighted average Fitch
expected loss for CREL assets is therefore modestly higher than
the average expected loss at the time of the last review.
The CDO is in compliance with all its reinvestment covenants. The
WAS and WAC have remained constant since the last review at 2.40%
and 5.32%, respectively. Approximately 8.3% of the pool is fixed
rate. The weighted average life has decreased to 3.4 years from
4.0 years at the August 2006 review, continuing to imply that the
pool composition will fully turnover during the reinvestment
period.
The over collateralization and interest coverage ratios of all
classes have remained above their covenants, as of the March 2007
effective date trustee report.
Collateral Analysis:
Most of the CREL assets are junior participations, including B-
notes and mezzanine debt. Only 8.2% of the portfolio (12.1% of
CREL assets) is invested in whole loans/A-notes. Many of the
subordinate loans are secured by interests in institutional
quality assets with experienced sponsors. Additionally, most of
the loans have Fitch stressed debt service coverage ratios above
1.0 x and loan-to-value ratios below 100%.
As of the May 2007 trustee report, the CDO is within all property
type covenants. Loans on retail properties, representing 32.9% of
the portfolio including the Toys 'R' Us and GGP bank loans, are
now the largest property type category. The concentration of
retail properties has increased from 20.4% since the last review.
The percentage of hotel assets has decreased since the last review
to 26.9% from 36.1%. The hotel loans are secured by interests in
471 individual properties and include hotels in the luxury,
upscale, and extended stay segments of the industry, which
provides further diversity by hospitality type. The CDO is also
within all of its geographic location covenants with the highest
percentage of assets located in California at 13.1%. The
portfolio continues to be geographically diverse.
The Fitch Loan Diversity Index is 685 compared to the covenant of
870, which represents below average diversity as compared to other
CRE CDOs.
No single obligor may represent more than $30.0 million
(approximately 10.0% of the portfolio). Currently, the largest
obligor represents US$30.0 million of the deal.
As of the most recent trustee report, 11.8% of the pool is
invested in CMBS. The transaction's current exposure consists of
two large loan floating rate deals of 2005 vintage. The CMBS
include the Class G tranche of the GS Mortgage Securities
Corporation II, Series 2005-GSFL VII (GSMS 2005-GSFL VII) and the
Class K tranche of Bank of America Large Loan, Series 2005 - ESH
(BALL 2005-ESH) rated 'BBB-' and 'BB', respectively, by Fitch.
The CDO has a maximum 40.0% bucket of CMBS, with a 10.0% cap on
CMBS conduit securities.
Rating Definitions:
The ratings of the classes S, A, and B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the aggregate
outstanding amount of principal by the stated maturity date. The
ratings of the class C, D, E, and F notes address the likelihood
that investors will receive ultimate interest and deferred
interest payments, as per the governing documents, as well as the
aggregate outstanding amount of principal by the stated maturity
date.
Although reinvestment cushion is above average, upgrades during
the reinvestment period are unlikely given the pool could still
migrate to the PEL covenant.
Ongoing Surveillance:
Fitch will continue to monitor and review this transaction and
will issue an updated Snapshot report after each committeed
review. The surveillance team will conduct a review whenever
there is approximately 15% change in the collateral composition or
semi-annually.
HANCOCK FABRICS: Equity Panel Objects to Ableco DIP Financing
-------------------------------------------------------------
The Official Committee of Equity Security Holders in Hancock
Fabrics Inc. and debtor-affiliates' bankruptcy cases, Developers
Diversified Realty Corporation, Weingarten Realty Investors, RMC
Property Group, and BC Wood Properties LLC, and Kimco Realty
Corp. and its affiliates and subsidiaries blocked the approval of
the Debtors' proposed $12,500,000 DIP Financing from Ableco
Finance LLC.
The proposed DIP facility may be increased to $17,500,000 at
Ableco's sole and absolute discretion, subject to the completion
of additional due diligence.
As reported in the Troubled Company Reporter on May 24, 2007,
Hancock Fabrics Inc. and its debtor-affiliates asked the United
States Bankruptcy Court for the District of Delaware for
authority to obtain additional postpetition loans, advances and
other financial accommodations of up to $17,500,000 from Ableco
Finance LLC, as lender and agent for itself and certain other
Lenders, to be used for Debtors' working capital needs in the
ordinary course of business.
This is in addition to the $105,000,000 in loans and letters of
credits that the Hon. Judge Brendan Linehan Shannon authorized the
Debtors to avail from Wachovia Bank N.A., and certain other
lenders.
To date, the Debtors have not yet filed their response to the
objections.
1. Equity Committee
Representing the Equity Committee, Eric Sutty, Esq., at The
Bayard Firm, in Wilmington, Delaware, tells Judge Shannon that
the decision to permit the creation of another secured creditor
with super-priority status in the Debtors' Chapter 11 cases,
ahead of unsecured claims and equity holders, needs to be
carefully considered by the Court, as well as all parties-in-
interest, including the Equity Committee.
Thus, the Equity Committee asks Judge Shannon to adjourn the
hearing on the Debtors' Motion, or, in the alternative, deny the
Motion, without prejudice to the Debtors' ability to seek
approval of the secondary DIP facility at a later time if
necessary and appropriate.
"Because the Equity Committee has literally just been formed, and
has not yet received any material confidential information from
the Debtors about their businesses or financial affairs, a brief
adjournment of the hearing on the Ableco DIP is necessary to
allow the Equity Committee a reasonable opportunity to consider
the relief requested," states Mr. Sutty.
Mr. Sutty asserts that the Debtors fall short of carrying their
burden in the Motion because:
(i) beyond generalized and unsupported assertions of need for
additional financing, the Debtors have no substantive
explanation as to why they must have the second DIP
facility, hence, it is impossible for the Court or any
party-in-interest to make an informed judgment;
(ii) the Equity Committee believes that there is substantial
current availability under the Wachovia DIP, and it
appears that the Debtors' recent store closures and
associated inventory sales may have produced a greater
than anticipated return to enable them to pay down the
Wachovia DIP, thus providing additional borrowing
capabilities;
(iii) the Debtors failed to address specific and material
issues related to the Ableco DIP;
(iv) if it is the Debtors' position that the $105,000,000
Wachovia DIP is insufficient, it is difficult to
determine whether the additional $12,500,000 Ableco DIP,
an increase of only 12% in potential availability, is
sufficient; and
(v) the Debtors failed to disclose the fees to be paid to
Ableco in connection with the DIP, which fees are
apparently set out in a separate fee letter that has not
been included in the Motion.
2. DDR Entities
The DDR Entities lease retail space to the Debtors at various
lease premises pursuant to separate lease agreements that
restrict the Lenders from holding a lien directly on the Leases.
According to James S. Carr, Esq., at Kelley Drye & Warren, LLP,
in New York, the Debtors' Proposed Term Loan Order would
invalidate any anti-lien restriction and anti-assignment
provisions in the Leases."
Mr. Carr argues that the Lender's liens should be limited to the
proceeds of the sale of the Leases, since the Debtors are not
allowed to invalidate Lease Provisions that prohibit direct liens
on Leases.
Mr. Carr explains that limiting the Liens to the proceeds of the
sale of the Leases will provide the Landlords with adequate
protection.
The Lender has not provided any rational explanation as to why it
requires a lien on the Leases, as opposed to a lien on the
proceeds from the sale of the Leases, relates Mr. Carr.
Mr. Carr says the "bonus value" of the Lease has been recognized
as property of the bankruptcy estate, and a security interest in
that bonus value, in the form of a lien on the proceeds from
disposing of the Leases, strikes an equitable balance between the
Lender's economic interests; the Debtors' need for financing; and
the Landlords' rights under the Leases, the Bankruptcy Code and
their obligations with the Lenders.
The DDR Entities maintain that the Lender's right to enter, use
and occupy the Leased Premises in the event of the Debtors'
default must be on notice to the Landlords and subject to further
Court order.
The DDR Entities do not oppose allowing the Lender access to the
Leased Premises up to three business days to remove their
collateral, provided that the Lender pays all per diem charges
and is responsible to the Landlords for any loss or damage.
The DDR Entities' Objection is supported by OH Retail, LL, LLC;
PNS Stores, Inc; and Federal Realty Investment Trust, et al.
3. Kimco Landlords
Kimco Landlords lease certain non-residential real property to
the Debtors. Each of the Leases contains certain restrictions on
the Debtors' ability to encumber, pledge or assign the Leases.
The Kimco Landlords contend that neither the Motion nor the
proposed order cites any authority for the Court to render any
provisions in the Leases unenforceable because, in the context of
a postpetition financing request, no authority of that nature
exists.
Instead of granting a lien on the Leases themselves, the Kimco
Landlords want the lien attached to the sale proceeds of the
Leases to adequately protect the Lender's interests, while
remaining consistent with the terms of the underlying leases.
The Kimco Landlords' Objection is supported by:
* Equity, Inc., as agent for Polaris Partners, Ltd., et al;
* Synergy Center, Ltd.;
* Federal Realty Investment Trust, et al;
* Simon Property Group;
* Lightman South Lake Co., LLC;
* Centro Watt;
* OH Retail, LL, LLC;
* Regency Centers L.P. et al;
* PNS Stores, Inc.; and
* Frank Mission, LLC.
The Court will convene a hearing on June 4, 2007, at 10:00 a.m.,
to consider the Debtors' request for additional DIP financing.
About Hancock Fabrics
Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc.
(OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty
retailer of a wide selection of fashion and home decorating
textiles, sewing accessories, needlecraft supplies and sewing
machines. Hancock Fabrics is one of the largest fabric retailers
in the United States, currently operating approximately 400 retail
stores in approximately 40 states. The company employs
approximately 7,500 people on a full-time and part-time basis.
Most of the company's employees work in its retail stores, or in
field management to support its retail stores.
The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors. When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.
The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007. (Hancock Fabric Bankruptcy News, Issue No. 10,
http://bankrupt.com/newsstand/or 215/945-7000).
HANCOCK FABRICS: Equity Panel Wants Sonnenschein as Lead Counsel
----------------------------------------------------------------
The Official Committee of Equity Security Holders in Hancock
Fabrics Inc. and debtor-affiliates' bankruptcy cases, seek the
United States Bankruptcy Court for the District of Delaware's
authority to retain Sonnenschein Nath & Rosenthal LLP, as its lead
counsel, nunc pro tunc to May 22, 2007.
Warren B. Kanders, co-chairperson of the Equity Committee, tells
the Court that Sonnenschein Nath is well qualified to represent
the panel in the Debtors' Chapter 11 cases in a cost effective
and timely manner, on account of its extensive experience in and
knowledge of business reorganizations under the Bankruptcy Code.
Specifically, Sonnenschein Nath will:
(a) give legal advice with respect to the Equity Committee's
powers and duties in the context of the case;
(b) assist and advise the Equity Committee in its
consultation with the Debtors, the Official Committee of
Unsecured Creditors, and others in the administration of
the Debtors' cases;
(c) attend meetings and negotiate with the representatives of
the Debtors, the Creditors Committee and other parties,
as appropriate and necessary;
(d) appear, as appropriate, before the Court, the appellate
courts, and the U.S. Trustee, and represent the interests
of the Equity Committee before the courts and the U.S.
Trustee;
(e) advise the Equity Committee in connection with proposals
and pleadings submitted to the Court by the Debtors,
Creditors Committee or others;
(f) generally prepare all necessary applications, motions,
answers, orders, reports and other legal papers in
support of positions taken by the Equity Committee;
(g) assist the Equity Committee in the review, analysis,
promulgation and negotiation of any plans of
reorganization for the Debtors and of matters relating to
the disclosure statement accompanying any plans of
reorganization;
(h) take all necessary actions to protect and preserve the
interests of holders of equity securities, including
investigating and prosecuting actions on the Equity
Committee's behalf; conducting investigations and
negotiations concerning litigation in which the Debtors
are involved; and reviewing, analyzing, and reconciling
claims filed against the Debtors' estates; and
(i) perform all other legal services for the Equity committee
concerning the cases.
Sonnenschein Nath's services will be paid according to its
current range of hourly rates:
Partners and Of Counsel $550 to $840
Associates $305 to $520
Paralegals $230 to $260
Sonnenschein will also be reimbursed for any out-of-pocket
expenses it incurs in representing the Equity Committee.
John A. Bicks, Esq., a partner at Sonnenschein Nath & Rosenthal,
LLC, in New York, assures the Hon. Judge Brendan Linehan Shannon
that his firm (i) does not represent any interest adverse to the
Equity Committee, the Debtors and their estates, and (ii) is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Hancock Fabrics
Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc.
(OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty
retailer of a wide selection of fashion and home decorating
textiles, sewing accessories, needlecraft supplies and sewing
machines. Hancock Fabrics is one of the largest fabric retailers
in the United States, currently operating approximately 400 retail
stores in approximately 40 states. The company employs
approximately 7,500 people on a full-time and part-time basis.
Most of the company's employees work in its retail stores, or in
field management to support its retail stores.
The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors. When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.
The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007. (Hancock Fabric Bankruptcy News, Issue No. 10,
http://bankrupt.com/newsstand/or 215/945-7000).
HANCOCK FABRICS: Equity Panel Want to Hire Bayard as Co-Counsel
---------------------------------------------------------------
The Official Committee of Equity Security Holders in Hancock
Fabrics Inc. and debtor-affiliates' bankruptcy cases, seek the
United States Bankruptcy Court for the District of Delaware's
authority to retain The Bayard Firm as its co-counsel, nunc pro
tunc to May 22, 2007.
The Equity Committee believes that Bayard has extensive attorney
experience and knowledge and has no conflict of interest.
Warren B. Kanders, co-chairperson of the Equity Committee,
discloses that prior to being retained by the Equity Committee,
Bayard provided advice to the Debtors' counsel on behalf of Kwik
Sew Pattern Co., Inc, a consignment creditor in the Debtors'
cases. Bayard also assisted Sonnenschein Nash & Rosenthal LLP,
in representing a number of holders of the Debtors' common shares
in the cases in seeking the appointment of an equity committee.
As co-counsel to the Equity Committee, Bayard's services include,
without limitation:
(a) providing legal advice with respect to the Equity
Committee's powers and duties;
(b) assisting in the investigation of the acts, conduct,
assets, liabilities and financial condition of the
Debtors' businesses, and any other matter relevant to the
cases or to the formulation of plans of reorganization or
liquidation;
(c) preparing necessary applications, motions, complaints,
answers, orders, agreements and other legal papers;
(d) reviewing, analyzing and responding to all pleadings filed
by the Debtors and appearing in Court to present necessary
motions, applications and pleadings and to otherwise
protect the Equity Committee's interest; and
(e) performing all other legal services for the Equity
Committee in connection with the Debtors' cases.
Bayard's customary hourly rates are:
Professional Hourly Rates
------------ ------------
Charlene D. Davis $550
Eric Sutty 340
Walter Cavers 185
Mr. Kanders relates that by separate application, the Equity
Committee is also seeking approval to retain Sonnenschein Nath &
Rosenthal LLP, to serve as the panel's lead counsel in the
Debtors' cases.
The Equity Committee states that if the Court approves the
retention of Sonnenschein and Bayard, the firms will allocate
their delivery of services so as to avoid any unnecessary
duplication of services.
Moreover, the efficient allocation of responsibility for legal
matters in the case between Sonnenschein and Bayard will reduce
the cost of monitoring the proceedings, as well as the time and
expense associated with travel by Sonnenschein with respect to
matters that can be handled as effectively by Delaware counsel,
Bayard.
Charlene D. Davis, Esq., director of The Bayard Firm, P.A., in
Wilmington, Delaware, attests that the firm does not represent
any adverse interests in the Debtors' cases.
About Hancock Fabrics
Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc.
(OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty
retailer of a wide selection of fashion and home decorating
textiles, sewing accessories, needlecraft supplies and sewing
machines. Hancock Fabrics is one of the largest fabric retailers
in the United States, currently operating approximately 400 retail
stores in approximately 40 states. The company employs
approximately 7,500 people on a full-time and part-time basis.
Most of the company's employees work in its retail stores, or in
field management to support its retail stores.
The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors. When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.
The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007. (Hancock Fabric Bankruptcy News, Issue No. 10,
http://bankrupt.com/newsstand/or 215/945-7000).
HARGRAY HOLDINGS: S&P Puts Corporate Credit Rating at B
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Hilton Head, South Carolina-based
telecommunications provider Hargray Holdings LLC. The outlook is
positive.
The company derives about 56% of its revenue from its business as
an incumbent local exchange carrier, 11% from "edge out" markets,
22% from wireless, and 11% from directories. Hargray is being
acquired by private equity firm Quadrangle Capital Partners and
the acquisition is expected to close this month.
In addition, S&P assigned bank loan ratings to the proposed
$315 million aggregate facilities of Hargray's funding conduits,
Hargray Communications Group Inc., DPC Acquisition LLC, and HCP
Acquisition LLC. A 'B' bank loan rating was assigned to the
$25 million senior secured first-lien revolver and $195 million
term loan B, and a 'CCC+' rating was assigned to the $95 million
senior secured second lien-term loan C. The recovery rating for
the first-lien revolver and term loan B is '3', suggesting
meaningful (50%-80%) recovery in the event of payment default.
The second-lien term loan is rated two notches below the corporate
credit rating, based on the significant amount of priority
obligations from the first-lien term loan and revolver. The
recovery rating for the second-lien term loan is '5', indicating
negligible (0%-25%) recovery in the event of payment default. The
bank loan rating is based on preliminary documentation and is
subject to receipt of final information. Pro forma total debt is
approximately $302 million on an operating lease adjusted basis.
Initial bank proceeds of $290 million, coupled with a $130 million
equity contribution from Quadrangle Capital Partners, will be used
finance the $269 million equity purchase price of Hargray by
Quadrangle, refinance about $134 million of debt, and pay
$17.5 million in related transaction fees and expenses.
"The ratings on Hargray reflect its concentrated services area and
small size, a new management team, below-industry-average
profitability, a weak wireless business with significant
competition, and a highly leveraged financial risk profile," said
Standard & Poor's credit analyst Allyn Arden. Mitigating factors
include Hargray's solid position as an ILEC, which represents
about 90% of its access lines, with limited competition and
favorable demographics.
Hargray is the ILEC in the Hilton Head Island area and other
markets in South Carolina. The company is also the incumbent
cable provider in a portion of its ILEC territory, which limits
competition from alternative telecommunications providers, and
allows it to offer telephony, high-speed data, and video services.
HELLER FINANCIAL: Fitch Holds Low-B Ratings on Two Certificates
---------------------------------------------------------------
Fitch Ratings assigns a Distressed Recovery rating to Heller
Financial Commercial Mortgage Asset Corp.'s mortgage pass-through
certificates, series 1999 PH-1, as:
-- $7.6 million class M to 'B-/DR1' from 'B-'.
In addition, Fitch affirms the ratings on these classes:
-- $472.5 million class A-2 at 'AAA';
-- Interest-only class X at 'AAA';
-- $22.7 million class B at 'AAA';
-- $20.2 million class C at 'AAA';
-- $53 million class D at 'AAA';
-- $12.6 million class E at 'AAA';
-- $37.9 million class F at 'AAA';
-- $17.7 million class G at 'AA+';
-- $35.3 million class H at 'A-';
-- $20.2 million class J at 'BBB-';
-- $7.6 million class K at 'BB+';
-- $15.1 million class L at 'B';
The $6.3 million class N is not rated by Fitch. Class A-1 has
paid in full.
The DR rating is assigned to reflect increased uncertainty
surrounding the disposition of the specially serviced loans and
potential losses.
The affirmations reflect the increased subordination levels due to
loan payoffs, scheduled amortization, as well as additional
defeasance of six loans (7.7%) since Fitch's last rating action
being moderated by increased uncertainty surrounding the specially
serviced loans. As of the May 2007 distribution date, the pool's
balance has been reduced 27.8% to $728.8 million from $1 billion
at issuance. Since issuance, 36 loans (24.4%) have defeased.
Currently, there are five specially serviced loans (2.1%).
The largest specially serviced loan (0.9%) is secured by a
multifamily property in Houston, TX and is current. The loan
transferred to special servicing in October 2006 due to imminent
default arising from a decline in occupancy. The loan is current
and the special servicer is negotiating with the borrower with
respect to a workout.
The second largest specially serviced asset (0.7%) is a portfolio
of three loans which are backed by three cross-collateralized
multifamily properties located in Colorado Springs, Colorado. One
loan (0.1%) has been sold and the proceeds have been used to pay
down the principal balance of the pool pro-rata. The remaining
two loans (0.6%) remain current and the special servicer is
evaluating workout options with respect to these loans.
The third largest specially serviced asset (0.5%) is a retail
center in Inkster, MI and is real estate owned (REO). The
property is currently listed for sale and the current appraisal
value indicates losses.
Fitch-projected losses on the specially serviced loans are
expected to be absorbed by nonrated class N.
Fitch reviewed the performance and underlying collateral of the
two credit assessed loans in the pool: South Plains Mall (8.1%)
and the Station Plaza Office Complex (2.4%). Based on their
stable performance, both credit assessments remain investment
grade.
HSI ASSET: Moody's Rates Class M-10 Certificates at (P)Ba1
----------------------------------------------------------
Moody's Investors Service assigned provisional ratings to
certificates issued by HSI Asset Securitization Corporation Trust
2007-NC1.
The complete provisional rating actions are:
* HSI Asset Securitization Corporation Trust 2007-NC1
* Mortgage Pass-Through Certificates, Series 2007-NC1
Class A-1, Assigned (P)Aaa
Class A-2, Assigned (P)Aaa
Class A-3, Assigned (P)Aaa
Class A-4, Assigned (P)Aaa
Class M-1, Assigned (P)Aa1
Class M-2, Assigned (P)Aa2
Class M-3, Assigned (P)Aa3
Class M-4, Assigned (P)A1
Class M-5, Assigned (P)A2
Class M-6, Assigned (P)A3
Class M-7, Assigned (P)Baa1
Class M-8, Assigned (P)Baa2
Class M-9, Assigned (P)Baa3
Class M-10, Assigned (P)Ba1
Investors should be aware that the certificates have not yet been
issued. Upon issuance of the certificates and upon conclusive
review of all documents and information about the transaction, as
well as any subsequent changes in information, Moody's will
endeavor to assign definitive ratings, which may differ from the
provisional ratings.
INNOVATIVE TECHNOLOGY: Wants Leach Travell as Bankruptcy Counsel
----------------------------------------------------------------
Innovative Technology Application Inc. asks the U.S. Bankruptcy
Court for the Eastern District of Virginia for authority to employ
Leach Travell Britt pc as its bankruptcy counsel.
Leach Travell will:
a. assist and advise the Debtor in its consultations with
creditors and other parties in interest concerning the
administration of this case, including the sale of the
Debtor's assets;
b. attend meetings and negotiate with representatives of the
Debtor's creditors and other parties in interest in this
case;
c. assist and advise the Debtor in connection with any legal
issues arising from the conduct of the Debtor's affairs;
d. assist the Debtor in the preparation, review, analysis and
negotiation of any plans of reorganization and disclosure
statements that may be filed in this case;
e. assist the Debtor in the review, analysis, and negotiation
of any cash collateral or financing agreements;
f. take all necessary action to protect and preserve the
interests of the Debtor, including:
(i) possible prosecution of actions on its behalf;
(ii) if appropriate, negotiations concerning all
litigation in which the Debtor is involved; and
(iii) if appropriate, review and analysis of claims filed
against the Debtor's estate;
g. generally prepare on behalf of the Debtor all necessary
motions, applications, answers, orders, reports and papers
in support of positions taken by the Debtor;
h. appear, as appropriate, before this Court, the appellate
courts, and the U.S. Trustee, and to protect the interests
of the Debtor before those courts and before the U.S.
Trustee; and
i. perform all other necessary legal services in this case.
The Debtor assures the Court that LTB represents no
adverse interest to the Debtor or its estate. The Debtor
added that LTB's employment will be in the best interests
of the Debtor and its estate.
The Debtors will pay LTB based on these current hourly rates:
Designation Hourly Rate
----------- -----------
Partner $375 - $395
Associate $225 - $295
Paralegal/Legal Assistant $110 - $135
To the best of the Debtor's knowledge, LTB represents no adverse
interest to the Debtor or its estate.
The firm can be reached at:
Stephen E. Leach, Esq.
Leach Travell Britt pc
8270 Greensboro Drive, Suite 1050
McLean, Virginia 22102
Telephone: (703) 584-8900
Fax: (703) 584-8901
http://www.ltblaw.com/
Innovative Technology Application Inc. in Springfield, Virginia, -
- http://www.itapages.com/-- is a Federal contractor that
specializes in knowledge management and counterterrorism
consulting products and services. The Debtor filed for chapter 11
protection on May 24, 2007 (Bankr. E.D. Va. Case No. 07-11324).
When the Debtor filed for protection, it listed estimated assets
and debts between $1 Million to $100 Million. Its bankruptcy
petition showed that unsecured creditors have total claims of more
than $10 million.
INTERACTIVE BRAND: March 31 Balance Sheet Upside-Down by $35.9MM
----------------------------------------------------------------
Interactive Brand Development Inc. reported a net loss of
$2,463,207 for the first quarter ended March 31, 2007, compared
with a net loss of $3,327,147 for the same period last year.
Revenues from continuing operations decreased $328,993 to $0 for
first quarter ended March 31, 2007, compared to $328,993 for the
same period in 2006.
For the quarter ended March 31, 2007, loss from discontinued
operations was $317,661, compared to a loss from discontinued
operations of $2,761,198 for the same period in 2005.
The loss from discontinued operations in both periods reflect the
results of operations of the company's wholly owned subsidiary,
Internet Billing Company LLC, whose credit card processing
operations was suspended by the company in December 2006.
Operating costs expenses from continuing operations increased
$1,387,736 to $1,757,314 for the first quarter of 2007 compared to
$369,578 for the same period last year. The increase in operating
costs and expenses from continuing operations for the first
quarter of 2007 was mainly due to a $1,094,830 expense recorded in
the first quarter of 2007 to write down the company's investment
in iBill to its realizable value.
The company recorded interest expense on borrowings of $414,774
for the first quarter of 2007 compared to interest expense on
borrowings of $620,215 for the first quarter of 2006.
At March 31, 2007, the company's balance sheet showed $20,126,090
in total assets, and $56,098,615 in total liabilities, resulting
in a $35,972,525 total stockholders' deficit.
The company's balance sheet at March 31, 2007, also showed
strained liquidity with $90,773 in total current assets available
to pay $51,736,374 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?20aa
Going Concern Doubt
Jewett, Schwartz, Wolfe & Associates, in Hollywood, Florida,
expressed substantial doubt about ability continue as a going
concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2006. The auditing firm
pointed to the company's recurring operating losses and working
capital deficit at Dec. 31, 2006.
About Interactive Brand
Based in Deerfield Beach, Fla., Interactive Brand Development Inc.
(OTC BB: IBDI.OB) -- http://www.interactivebranddevelopment.com/
-- was, prior to Dec. 31, 2006, through its wholly owned
subsidiary, Internet Billing Company LLC, engaged in providing
payment processing operations to Etelegate Arizona LLC. A
dispute, however, concerning processing volume arose between the
parties in June 2006. By December 2006, both companies had
abandoned the agreement and lacking an outsourced payment
processing service provider, iBill's operations were discontinued.
ISLE OF CAPRI: Has Until July 25 to Comply with Nasdaq Rules
------------------------------------------------------------
Isle of Capri Casinos Inc. has received a favorable ruling from
the NASDAQ Listing Qualifications Panel relating to the company's
inability to file its previous Quarterly Report on Form 10-Q by
the March 9 due date.
During a hearing before the Panel on April 26, 2007, the company
requested an exception to the applicable NASDAQ rules, allowing
the company until July 25, 2007, to cure the filing deficiency and
asking NASDAQ to continue listing the company's common stock on
the NASDAQ Global Select Market during the interim period. The
Panel has granted the company's request.
The company's failure to timely file its Form 10-Q for its third
fiscal quarter ended Jan. 28, 2007, by the March 9 due date
resulted from the company's restatement of its financial
statements for the fiscal years ended April 25, 2004; April 24,
2005 and April 30, 2006, and the quarterly results for fiscal 2005
and 2006 included therein, and for the first two quarters of
fiscal 2007. The failure to make a timely quarterly filing
meant that Isle of Capri was not in compliance with the filing
requirements for continued listing of its common stock on the
NASDAQ Global Select Market as set forth in Marketplace Rule
4310(c)(14).
The company subsequently filed its Form 10-Q for the quarter on
April 18, 2007, but due to the ongoing restatement process the
filing had not been reviewed by the company's independent
auditors. The company expects to file an amended Quarterly Report
on Form 10-Q, reviewed as required by the company's independent
auditors, prior to the July 25, 2007, date set forth in the
Panel's decision.
Based in Biloxi, Missippi and founded in 1992, Isle of Capri
Casinos Inc. (Nasdaq: ISLE) -- http://www.islecorp.com/-- owns
and operates casinos in Biloxi, Lula and Natchez, Mississippi;
Lake Charles, Louisiana; Bettendorf, Davenport and Marquette,
Iowa; Kansas City and Boonville, Missouri and a casino and harness
track in Pompano Beach, Florida. The company also operates and
has a 57 percent ownership interest in two casinos in Black Hawk,
Colorado. Isle of Capri Casinos' international gaming interests
include a casino that it operates in Freeport, Grand Bahama and a
two-thirds ownership interest in casinos in Dudley and
Wolverhampton, England.
* * *
Moody's Investors Service affirmed its Ba3 Corporate Family Rating
on Isle of Capri Casinos in connection with its implementation of
the new Probability-of-Default and Loss-Given-Default rating
methodology for the Gaming, Lodging & Leisure sector. Moody's
assigned LGD ratings to four of the company's debts including a
LGD5 rating on its 9% Sr. Sub. Notes, suggesting debt holders will
experience a 76% loss in the event of a default.
JEAN COUTU: Debt Repayment Prompts Fitch to Withdraw Ratings
------------------------------------------------------------
Fitch Ratings has withdrawn these ratings for the Jean Coutu Group
Inc.:
-- Issuer Default Rating 'B-';
-- $350 million secured bank facility 'BB-/RR1';
-- $250 million secured term loan A 'BB-/RR1';
-- $1.1 billion secured term loan B 'BB-/RR1';
-- $350 million senior unsecured notes 'B+/RR2';
-- $850 million senior subordinated notes 'CCC-/RR6';
The Rating Outlook is Stable.
Fitch's ratings withdrawal follows the acquisition of Jean Coutu's
U.S. Brooks and Eckerd stores by Rite Aid Corp. and the repayment
of all of Jean Coutu's debt. Fitch will no longer provide ratings
or analytical coverage on the company.
JP MORGAN: S&P Affirms B Rating on Class B-5 Issue
--------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' rating on
class B-5 issued by J.P. Morgan Mortgage Trust 2005-S1 and removed
it from CreditWatch, where it was placed with negative
implications Sept. 20, 2006.
S&P affirmed its rating on this class and removed it from
CreditWatch due to stable collateral performance since the
CreditWatch placement. As of the May 2007 remittance period,
total delinquencies had declined to 3.45% from 5.05% since the
August 2006 reporting period, and the deal had only realized
$232,604 in cumulative losses (0.06% of the original pool
balance). When S&P placed its rating on this class on CreditWatch
with negative implications, S&P loss expectations were higher than
the recent actual losses.
This deal utilizes a senior/subordinate structure. Because of the
recent favorable collateral performance, S&P do not expect to take
any rating actions on this class in the upcoming months.
The collateral for this transaction consists of prime adjustable-
rate and conventional mortgage loans secured by first liens on
primarily one- to four-family residential properties.
KENNETT SQUARE: Formation/JER Buyout Cues S&P to Retain Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services said its corporate credit
rating on Kennett Square, Pennsylvania-based nursing home owner
and operator Genesis HealthCare Corp. (B+/Watch Neg/--) remains on
CreditWatch with negative implications, where it was originally
placed on Jan. 17, 2007. The CreditWatch listing reflects the
company's pending LBO by Formation Capital LLC and JER Partners.
"After a bidding war between the Formation Capital/JER Partners
joint venture and Fillmore Capital Partners LLC, shareholders on
May 30 approved the offer by Formation/JER of $69.35 per share,"
explained Standard & Poor's credit analyst David Peknay.
KNARFD LLC: Case Summary & Eight Largest Unsecured Creditors
------------------------------------------------------------
Debtor: KNARFD, LLC
8600 Starboard Drive, Suite 2013
Las Vegas, NV 89117
Bankruptcy Case No.: 07-13332
Type of Business:
Chapter 11 Petition Date: June 5, 2007
Court: District of Nevada (Las Vegas)
Judge: Linda B. Riegle
Debtor's Counsel: Christopher Patrick Burke, Esq.
218 South Maryland Parkway
Las Vegas, NV 89101
Tel: (702) 385-7987
Fax: (702) 385-7986
Total Assets: $2,857,100
Total Debts: $2,878,169
Debtor's List of its Eight Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Citi Mortgage Real Estate $312,000
P.O. Box 183040 Secured:
Columbus, OH 43218-3040 $390,000
Senior Lien:
$80,882
GMAC Real Estate $77,894
P.O. Box 4622
Waterloo, IA 50704
Clark County Treasurer Real Estate $16,282
500 South Grand Central
Parkway
P.O. Box 551220
Las Vegas, NV 89155-1220
Cactus Springs Real Estate $773
Homeowners Association
City of Las Vegas - Sewer Real Estate $594
RMI Management, LLC Real Estate $220
Summerling West Real Estate $175
Community Association
Spinnaker Homes Real Estate $95
KRATON POLYMERS: Weakened Profitability Cues S&P to Lower Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Kraton
Polymers LLC, including the corporate credit and senior secured
debt ratings to 'B' from 'B+'. The outlook is negative.
The downgrade follows weakened profitability primarily because of
higher than expected raw material cost inflation that has resulted
in the deterioration of key measures of credit quality.
"While we expect management to raise prices in order to offset
some of the raw material pressure, Kraton's cash flow generation
is likely to remain weaker than initially expected during the next
few quarters, limiting the company's ability to improve its highly
leveraged financial profile back toward the level appropriate for
the previous ratings," said Standard & Poor's credit analyst David
Bird.
The ratings on Kraton reflect its weak business risk profile
derived from its narrow focus on the styrenic block copolymers
market and a highly leveraged financial profile.
Houston, Texas-based Kraton is a leading producer of SBCs with
about $1 billion in annual sales and approximately $631 million of
debt outstanding, including a modest amount of capitalized
operating leases and unfunded postretirement obligations. The
company produces unhydrogenated SBCs, hydrogenated
SBCs,polyisoprene rubber, polyisoprene latex, and SBC-based
compounded materials. SBCs offer flexibility, resilience,
strength, and durability to a wide range of products in a number
of end-use markets, including (1) adhesive, sealants, and
coatings, (2) paving and roofing, (3) compounding channels, (4)
packaging and films, and (5) personal care.
The SBC market is part of the larger thermoplastic elastomers
industry, with a market size of approximately $3 billion and an
expected future growth rate of about 6% per year. Between the two
product types, faster growth is expected in HSBCs, which are used
in a variety of applications such as personal hygiene and soft-
grip handles. USBC growth is typically slower and is focused on
mature end markets such as asphalt modification and adhesives.
LANDSAFE PROPERTIES: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Landsafe Properties, L.L.C.
2901 West Beverly Boulevard, Suite 204
Montebello, CA 90640
Bankruptcy Case No.: 07-14632
Type of Business: The Debtor owns real estate properties.
Chapter 11 Petition Date: June 5, 2007
Court: Central District Of California
Judge: Victoria S. Kaufman
Debtor's Counsel: Louis J. Esbin, Esq.
27201 Tourney Road, Suite 122
Valencia, CA 91355-1804
Tel: (661) 254-5050
Fax: (661) 254-5252
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
The Debtor does not have any creditors who are not insiders.
LB-UBS COMMERCIAL: Moody's Rates Three Cert. Classes at Low-B
-------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 28 classes of
LB-UBS Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 2005-C3 as:
-- Class A-1, $26,824,834, affirmed at Aaa;
-- Class A-2, $153,000,000, affirmed at Aaa;
-- Class A-3, $269,000,000, affirmed at Aaa;
-- Class A-4, $100,000,000, affirmed at Aaa;
-- Class A-5, $691,686,000, affirmed at Aaa;
-- Class A-AB, $80,000,000, affirmed at Aaa;
-- Class A-M, $196,670,000, affirmed at Aaa;
-- Class A-J, $184,378,000, affirmed at Aaa;
-- Class X-CL, Notional, affirmed at Aaa;
-- Class X-CP, Notional, affirmed at Aaa;
-- Class X-CBM, Notional, affirmed at Aaa;
-- Class B, $22,125,000, affirmed at Aa1;
-- Class C, $19,667,000, affirmed at Aa2;
-- Class D, $19,667,000, affirmed at Aa3;
-- Class E, $12,292,000, affirmed at A1;
-- Class F, $19,667,000, affirmed at A2;
-- Class G, $14,750,000, affirmed at A3;
-- Class H, $22,125,000, affirmed at Baa1;
-- Class J, $19,667,000, affirmed at Baa2;
-- Class K, $19,667,000, affirmed at Baa3;
-- Class L, $7,375,000, affirmed at Ba1;
-- Class M, $2,459,000, affirmed at Ba2;
-- Class N, $2,458,000, affirmed at Ba3;
-- Class CBM-1, $5,400,000, affirmed at Baa1;
-- Class CBM-2, $16,500,000, affirmed at Baa2;
-- Class CBM-3, $20,800,000, affirmed at Baa3;
-- Class ML-1, $7,536,204, affirmed at Baa2;
-- Class ML-2, $43,700,000, affirmed at Baa3.
As of the May 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 2.7%
to $2.0 billion from $2.1 billion at securitization. The
Certificates are collateralized by 116 loans, ranging in size from
less than 1.0% to 14.6% of the pool, with the top 10 loans
representing 56.7% of the pool. The pool includes 10 shadow rated
loans, representing 53.0% of the pool.
The pool has not realized any losses since securitization and
currently there are no loans in special servicing. Twelve loans,
representing 8.5% of the pool, are on the master servicer's
watchlist.
Moody's was provided with year-end 2006 and partial-year 2007
operating results for 92.6% and 73.9%, respectively, of the pool.
Moody's weighted average loan to value ratio for the conduit
component is 105.2%, compared to 104.7% at securitization.
Moody's is affirming all classes due to stable overall pool
performance.
The largest shadow rated loan is the 200 Park Avenue Loan ($278.5
million -- 14.6%), which represents a pari passu interest in a
$900.0 million first mortgage loan secured by a 2.9 million square
foot Class A office building located in New York City. The
property was 98.0% occupied as of June 2006, essentially the same
as at securitization. The first mortgage loan includes a $51.2
million junior non pool component which is
the security for non-pooled Classes ML-1 and ML-2. Moody's
current shadow ratings of the pooled loan and junior non-pooled
component are Baa2 and Baa3, respectively, the same as at
securitization.
The second largest shadow rated loan is the 900 North Michigan
Avenue Loan ($203.0 million -- 10.6%), which is secured by a mixed
use property consisting of a vertical mall (475,400 square feet),
office tower (349,900 square feet) and garage (1,660 spaces). The
collateral is part of a larger complex which includes a 343-room
Four Seasons Hotel and 106 residential condominium units. The
complex was 97.0% leased as of
September 2006, compared to 95.7% at securitization. Moody's
current shadow rating is Baa2, the same as at securitization.
The third largest shadow rated loan is the Wachovia Portfolio Loan
($182.6 million -- 10.3%), which is secured by a portfolio of 131
office properties, operations centers, retail bank branches and
parking garages totaling 6.6 million square feet and located in 10
states. Wachovia Bank, N.A. leases approximately 81.7% of the
premises through September 2024. The loan is structured with a
27-year amortization schedule and has amortized by approximately
10.3% since securitization. Moody's current shadow rating is Aa2,
compared to Aa3 at securitization.
The fourth largest shadow rated loan is the Courtyard by Marriott
Portfolio Loan ($121.5 million -- 6.4%), which represents a
participation interest in a $550.0 million first mortgage loan
secured by a portfolio of 64 limited service hotels located in 29
states. The portfolio's overall occupancy and RevPAR for calendar
year 2006 were 69.7% and $76.98, respectively, compared to 69.5%
and $74.56 at securitization. The first mortgage loan includes a
$42.7 million junior non-pooled component, which is the security
for non-pooled Classes CMB-1, CMB-2 and CMB-3. Moody's current
shadow ratings of the pooled loan and junior non- pooled component
are Baa1 and Baa3, respectively, the same as at securitization.
The fifth largest shadow rated loan is the 101 Avenue of the
Americas Loan ($87.7 million -- 4.6%), which represents a pari
passu interest in a $146.4 million first mortgage loan secured by
a leasehold mortgage on a 411,100 square foot office building
located in New York City. The building is 100.0% leased by
Service Employees International Union Building Services Local 32B-
J and affiliated operations under a lease through December 2011.
Moody's current shadow rating is Baa3, the same as at
securitization.
The sixth largest shadow rated loan is the Lakeside Commons Loan
($46.5 million -- 2.4%), which is secured by a Class A office
complex totaling 513,7000 square feet located in Atlanta, Georgia.
Although occupancy has increased to 91.0% as of September 2006,
compared to 86.9% at securitization, performance has declined due
to increased operating expenses. Moody's current shadow rating is
Ba1, compared to Baa2 at securitization.
The seventh largest shadow rated loan is the Macquarie DDR
Portfolio III Loan ($39.3 million -- 2.1%), which is secured by
the borrower's interest in three retail properties totaling 1.2
million square feet and located in three states. Moody's current
shadow rating is Baa3, the same as at securitization.
The remaining shadow rated loans comprise 3.5% of the pool. The
Decorative Center of Houston Loan ($33.9 million -- 1.8%) is
secured by a 508,900 square foot office and design center complex
located in Houston, Texas. Performance has declined since
securitization due to lower revenues and higher expenses. Moody's
current shadow rating is Ba1, compared to Baa3 at securitization.
The Inn at Fox Hollow Loan ($17.5 million -- 0.9%) is secured by a
145-room hotel located in Woodbury, New York. Performance has
declined due to a drop in revenues and increased expenses.
Moody's current shadow rating is Ba1, compared to Baa3 at
securitization. The 1919 Park Avenue Loan ($15.0 million -- 0.8%)
is secured by a 208,600 square foot office building located in
Weehawken, New Jersey. Moody's current shadow rating is Aaa, the
same as at securitization.
The top three conduit loans represent 6.4% of the pool. The
largest conduit loan is the Crossroads Towne Center Loan ($50.5
million -- 2.6%), which is secured by the borrower's interest in a
1.3 million square foot regional retail center located in Gilbert,
Arizona. Moody's LTV is 106.3%, the same as at securitization.
The second largest conduit loan is the Pacific Pointe Loan ($40.3
million -- 2.1%), which is secured by a 256,100 square foot office
building located in Los Angeles, California. The property is
performing below Moody's expectations and is on the master
servicer's watchlist due to low debt service coverage. Moody's
LTV is 153.0%, compared to 149.9% at securitization. The third
largest conduit loan is the Medlock Crossing Loan ($32.3 million
-- 1.7%), which is secured by a 159,000 retail center located in
Duluth, Georgia. Moody's
LTV is 99.4%, compared to 102.8% at securitization.
MARQUEE HOLDINGS: To Form New Holding Company
---------------------------------------------
Marquee Holdings Inc., the parent of AMC Entertainment Inc., will
form a new holding company that will become the sole parent of the
company. Marquee Holdings intends that the holding company enter
into a five-year $400 million aggregate principal amount senior
unsecured term loan facility.
Affiliates of JPMorgan Chase Bank, N.A. will be the initial lender
and administrative agent under this facility, and J.P. Morgan
Securities Inc. will serve as a lead arranger and bookrunning
manager for this facility. The net proceeds from this facility
will be used to pay a dividend to Marquee's current stockholders.
Neither Marquee, AMCE, nor any of its subsidiaries will be a party
to the facility.
Marquee also announced a solicitation of consents to a proposed
amendment to the indenture governing its 12% Senior Discount Notes
due 2014 (CUSIP No. 57143VAC3), on the terms and subject to the
conditions set in the Consent Solicitation Statement dated
June 5, 2006 and the accompanying Letter of Consent.
The Amendment would revise the restricted payments covenant to
permit Marquee to make restricted payments in an aggregate amount
of $275 million prior to making an election to pay cash interest
on the Notes. The Amendment will also contain a covenant by
Marquee to make an election on Aug. 15, 2007, the next semi-annual
accretion date under the Indenture, to pay cash interest on the
Notes. As a result, Marquee would be required to make its first
cash interest payment on the Notes on Feb. 15, 2008. Regardless
of whether Marquee completes the Consent Solicitation, the new
term loan facility described above will require Marquee to make
this election on Aug. 15, 2007.
If the Amendment is approved, the company intends to use cash on
hand at AMCE to pay a dividend to Marquee's current stockholders
in an aggregate amount of up to $275 million. Marquee also has
the option to instead fund such dividend by electing for Holdco to
enter into an additional 364-day $275 million aggregate principal
amount senior unsecured term loan facility.
Each holder who validly delivers Consents on or prior to the
expiration of the Solicitation Period shall be entitled to a
consent fee of $10 for each $1,000 principal amount at maturity of
Notes as to which consents are delivered by such holders if such
consents are accepted pursuant to the Consent Solicitation.
The Consent Solicitation expires at 5:00 p.m., New York City time,
on June 8, 2007, unless extended or earlier terminated by Marquee.
Delivery of Consents prior to the expiration of the Solicitation
Period may be validly revoked at any time prior to the date on
which the Requisite Consents have been obtained and evidence
thereof has been delivered to the trustee under the Indenture.
Marquee reserves the right to terminate, withdraw or amend the
Consent Solicitation at any time subject to applicable law.
Marquee expects to pay the Consent Fee in same-day funds on a date
promptly following the expiration of the Solicitation Period.
The company's Consent Solicitation is subject to the conditions
set forth in the Consent Solicitation Documents, including the
receipt of consents of the noteholders representing a majority in
aggregate principal amount at maturity of the Notes issued under
the Indenture.
Marquee has retained J.P. Morgan Securities Inc. to act as
solicitation agent in connection with the Consent Solicitation.
About Marquee Holdings
Based in Kansas City, Mo., Marquee Holdings Inc. is organized as
an intermediate holding company with no operations of its own.
The Company's principal directly owned subsidiaries are American
Multi-Cinema, Inc., Grupo Cinemex, S.A. de C.V., and AMC
Entertainment International, Inc.
About AMC Entertainment
Based in Kansas City, Missouri, AMC Entertainment Inc. --
http://www.amctheatres.com/-- is a worldwide leader in the
theatrical exhibition industry. The company serves more than 250
million guests annually through interests in 415 theatres and
5,672 screens in 12 countries including the United States.
* * *
As reported in the Troubled Company Reporter on May 18, 2007,
Fitch has affirmed the Issuer Default Ratings of Marquee Holdings
Inc. and its principal operating subsidiary AMC Entertainment,
Inc. at 'B'. Approximately $1.7 billion in total debt is
affected. The Rating Outlook is Stable.
MASTR SPECIALIZED: Moody's Cuts Rating on Class B Certs. to Ba3
---------------------------------------------------------------
Moody's Investors Service downgraded one certificate issued by
MASTR Specialized Loan Trust 2004-1. The underlying collateral
consists of fixed-rate and adjustable-rate scratch and dent
mortgage loans.
This subordinate tranche has been downgraded based on the low
credit enhancement levels compared to the loss projections for the
current rating level. The overcollateralization has declined
slightly due to low excess spread and a spike in loss severity in
the past year.
Complete rating action is:
* Issuer: MASTR Specialized Loan Trust 2004-1
-- Class B, Downgraded to Ba3 from Ba1.
MERITAGE MORTGAGE: Poor Performance Cues S&P to Lower Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on six
classes of mortgage-backed securities issued by Meritage Mortgage
Loan Trust's series 2004-1 and 2005-1. Of the six lowered
ratings, S&P removed one from CreditWatch negative, and four
remain on CreditWatch negative. At the same time, S&P placed its
ratings on two other classes on CreditWatch with negative
implications. In addition, S&P affirmed its ratings on 20 classes
from the same transactions.
The downgrades and negative CreditWatch placements reflect the
deteriorating performance of the collateral pools as monthly net
losses continue to significantly outpace monthly excess spread
interest, resulting in steady erosion of the classes' credit
support, particularly overcollateralization. Losses have reduced
O/C for series 2005-1 to zero, resulting in the downgrade of the
most subordinate classes, B-2 and B-1, to 'D' from 'CCC' and to
'B' from 'BB+', respectively. As of the May 2007 distribution,
series 2005-1 had total delinquencies of 30.12% of the current
pool balance, with severe delinquencies (90-plus days,
foreclosures, and REOs) totaling 18.00%. Cumulative realized
losses totaled 2.08% of the original pool balance. This
transaction is 27 months seasoned and has paid down to 22.75% of
its original size.
Losses have eroded the O/C for series 2004-1 to 2.25% of the
original pool balance, well below its target of 50%. As a result,
S&P lowered its rating on class B-1, the most subordinate class,
to 'CCC' from 'B'. In addition, S&P lowered its rating on class
M-8 to 'B-' from 'BB', on class M-7 to 'B' from 'BB', and on class
M-6 to 'BB' from 'BBB+', and left them on CreditWatch negative.
As of the May 2007 distribution, series 2004-1 had total
delinquencies of 34.54%, with severe delinquencies of 21.80%.
Currently, cumulative realized losses amount to 2.25% of the
original pool balance. This series is 37 months seasoned and has
paid down to 9.70% of its original size.
Standard & Poor's will closely monitor the performance of the
classes with ratings on CreditWatch from both of these
transactions. If monthly-realized losses decline to a point at
which they no longer outpace monthly excess interest, and the
level of O/C has not been further eroded, S&P will affirm the
ratings on these classes and remove them from CreditWatch.
Conversely, if losses continue to outpace excess interest, and the
levels of O/C continue to decline, S&P will take further negative
rating actions on these classes.
S&P removed the rating on class B-1 from CreditWatch because it
was lowered to 'CCC'. According to Standard & Poor's surveillance
practices, classes of certificates or notes from RMBS transactions
with ratings lower than 'B-' are no longer eligible to be on
CreditWatch negative.
The affirmations reflect adequate and projected credit support
provided by a combination of excess spread, O/C, and
subordination. The collateral for both transactions consists of
30-year fixed- and adjustable-rate subprime mortgage loans secured
by first liens on one- to four-family residential properties.
Ratings Lowered and Remaining on Creditwatch Negative
Meritage Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2004-1 M-6 BB/Watch Neg BBB+/Watch Neg
2004-1 M-7 B/Watch Neg BB/Watch Neg
2004-1 M-8 B-/Watch Neg BB-/Watch Neg
2005-1 B-1 B/Watch Neg BB+/Watch Neg
Rating Lowered and Removed from Creditwatch Negative
Meritage Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2004-1 B-1 CCC B/Watch Neg
Rating Lowered
Meritage Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-1 B-2 D CCC
Ratings Placed on Creditwatch Negative
Meritage Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2004-1 M-5 A-/Watch Neg A-
2005-1 M-11 BBB-/Watch Neg BBB-
Ratings Affirmed
Meritage Mortgage Loan Trust
Series Class Rating
------ ----- ------
2004-1 I-A1,II-A2 AAA
2004-1 M-1 AA
2004-1 M-2 AA-
2004-1 M-3 A+
2004-1 M-4 A
2005-1 I-A1,I-A2,II-A2,II-A3 AAA
2005-1 M-1,M-2 AA+
2005-1 M-3,M-4 AA
2005-1 M-5 AA-
2005-1 M-6 A+
2005-1 M-7 A
2005-1 M-8 A-
2005-1 M-9 BBB+
2005-1 M-10 BBB
MERRILL LYNCH: Moody's Holds Low-B Ratings on Six Cert. Classes
---------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 22 classes
Merrill Lynch Commercial Mortgage Trust, Commercial Mortgage Pass-
Through Certificates, Series 2005-MKB2 as:
-- Class A-1, $33,936,174, affirmed at Aaa;
-- Class A-2, $228,186,000, affirmed at Aaa;
-- Class A-3, $40,623,000, affirmed at Aaa;
-- Class A-1A, $213,326,168, affirmed at Aaa;
-- Class A-SB, $42,997,000, affirmed at Aaa;
-- Class A-4, $332,815,000, affirmed at Aaa;
-- Class AJ, $61,128,000, affirmed at Aaa;
-- Class XC, Notional, affirmed at Aaa;
-- Class XP, Notional, affirmed at Aaa;
-- Class B, $32,696,000, affirmed at Aa2;
-- Class C, $9,951,000, affirmed at Aa3;
-- Class D, $21,323,000, affirmed at A2;
-- Class E, $12,795,000, affirmed at A3;
-- Class F, $18,480,000, affirmed at Baa1;
-- Class G, $11,373,000, affirmed at Baa2;
-- Class H, $14,216,000, affirmed at Baa3;
-- Class J, $7,107,000, affirmed at Ba1;
-- Class K, $5,687,000, affirmed at Ba2;
-- Class L, $4,264,000, affirmed at Ba3;
-- Class M, $4,265,000, affirmed at B1;
-- Class N, $2,843,000, affirmed at B2;
-- Class P, $5,687,000, affirmed at B3.
As of the May 14, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 1.6%
to $1.12 billion from $1.14 billion at securitization. The
Certificates are collateralized by 86 mortgage loans. The loans
range in size from less than 1.0% to 6.0% of the pool, with the
top 10 loans representing 46.0% of the pool.
One loan, representing 5.8% of the pool, has defeased and is
collateralized by U.S. Government securities. The pool includes
one shadow rated loan, representing 3.0% of the outstanding loan
balance. There have been no loans liquidated from the pool. There
are no loans in special servicing. Seven loans, representing 5.7%
of the pool, are on the master servicer's watchlist.
Moody's was provided with full-year 2005 and partial-year 2006
operating results for 99.3% of the pool of which 42.9% are full-
year 2006 results. Moody's average weighted loan to value ratio
for the conduit component is 94.0%, compared to 96.1% at
securitization.
The shadow rated loan is the American Express Building Loan ($33.0
million -- 3.0%), which is secured by a four-story, Class A office
building containing a total of 389,000 square feet and located in
Greensboro, North Carolina. The entire building is leased to
American Express Travel Related Services Co., Inc. (Moody's senior
unsecured rating Aa3; stable outlook) through December 2014. The
loan is interest only for the entire term. Moody's current shadow
rating is Baa3, the same as at
securitization.
The three largest conduit loans represent 17.6% of the pool. The
largest conduit loan is the Luckman Plaza Loan ($67.3 million --
6.0%), which is secured by a 13-story, Class B office building
containing 281,000 square feet and located in Los Angeles,
California. Moody's LTV is in excess of 100.0%, the same as at
securitization.
The second largest conduit loan is the Lodgian Portfolio 3 Loan
($65.5 million -- 5.9%), which is secured by five full service
hotels and four limited service hotels located in Maryland (3),
Texas (2), Arkansas (1), New Hampshire (1), Kentucky (1) and West
Virginia (1). The portfolio flags include Holiday Inn, Courtyard
by Marriot, Marriot Fairfield Inn and Crowne Plaza. For the
trailing 12-month period ending January 2007 the portfolio's
RevPAR was $67.37, compared to $57.28 at year-end 2004. Moody's
LTV is 84.1%, compared to 90.2% at securitization.
The third largest conduit loan is the DeSoto Square Mall Loan
($64.2 million -- 5.7%), which is secured by a 693,000 square foot
(493,000 of collateral) regional mall located in Bradenton,
Florida. Moody's LTV is 99.0%, the same as at securitization.
MGM MIRAGE: Completes $200MM Sale of Colorado Belle & Edgewater
---------------------------------------------------------------
MGM MIRAGE has completed its sale of the Colorado Belle and
Edgewater hotel-casinos located in Laughlin, Nevada, to a group
led by Anthony Marnell III for $200 million.
On a combined basis, these two properties contain some 2,500 guest
rooms and over 100,000 square feet of casino space featuring
approximately 2,200 slot machines and 70 gaming tables. MGM
MIRAGE acquired these properties in April 2005 as part of its
acquisition of Mandalay Resort Group.
Anthony Marnell III is the Chairman and CEO of M Resorts. Marnell
and his management team are partnered with Sher Gaming, LLC, led
by Ed Sher, on this transaction. On June 1, 2006, a Marnell-Sher
partnership bought the Saddle West Hotel and Casino in Pahrump,
Nevada. Further information on the Marnell- led group can be
obtained from Greg Wells, President of Austi LLC, at 702-739-2000.
Banc of America Securities acted as financial advisor to the
Marnell group in connection with this transaction.
Headquartered in Las Vegas, Nevada, MGM Mirage (NYSE: MGM) --
http://www.mgmmirage.com/-- is a hotel and gaming company. It
owns and operates 19 properties located in Nevada, Mississippi and
Michigan, and has investments in three other properties in Nevada,
New Jersey and Illinois.
* * *
As reported on the Troubled Company Reporter on May 24, 2007,
Fitch has placed MGM MIRAGE's ratings on Rating Watch Negative
following Kirk Kerkorian's disclosure that he intends to explore
purchasing MGM's Bellagio and CityCenter properties well as pursue
strategic alternatives with respect to his investment in MGM
MIRAGE. These ratings were affected: (i)issuer default rating
'BB'; (ii) senior credit facility 'BB'; (iii) senior notes 'BB';
and (iv)senior subordinated notes 'B+'.
MICROCOMPUTER TECHNOLOGY: Voluntary Chapter 11 Case Summary
-----------------------------------------------------------
Debtor: Microcomputer Technology Institute, Inc.
dba M.T.I. College of Business and Technology
7277 Regency Square Boulevard
Houston, TX 77036
Bankruptcy Case No.: 07-33870
Type of Business: The Debtor owns and operates a college.
Chapter 11 Petition Date: June 5, 2007
Court: Southern District of Texas (Houston)
Debtor's Counsel: Aaron Keiter, Esq.
4545 Mount Vernon
Houston, TX 77006-5815
Tel: (713) 706-3636
Estimated Assets: Less than $10,000
Estimated Debts: $1 Million to $100 Million
The Debtor does not have any creditors who are not insiders.
MORGAN STANLEY: Fitch Holds Junk Ratings on Three Certificates
--------------------------------------------------------------
Fitch Ratings has upgraded Morgan Stanley Capital 1 Inc.'s
commercial mortgage pass-through certificates, series 1999-FNV1,
as :
-- $14.2 million class F to 'AAA' from 'AA+'.
Fitch also affirms the following classes:
-- $326.6 million class A-2 at 'AAA';
-- Interest-only class X at 'AAA';
-- $33.2 million class B at 'AAA';
-- $26.9 million class C at 'AAA';
-- $12.6 million class D at 'AAA';
-- $30 million class E at 'AAA';
-- $20.5 million class G at 'A-';
-- $7.9 million class H to 'BBB';
-- $9.5 million class J at 'BB-';
-- $7.9 million class K at 'B'.
Fitch also maintains the ratings of the following classes:
-- $6.3 million class L at 'CCC/DR3';
-- $6.3 million class M at 'C/DR6';
-- $795,667 class N at 'C/DR6'.
The balance of class O has been reduced to zero by realized
losses. Realized losses total $14.8 million to date. Class A-1
paid in full.
The upgrade reflects increased credit enhancement due to
additional paydown (2.6%) and defeasance (7.4%) since Fitch's last
rating action in November 2006. 41 loans (26.7%) have fully
defeased since issuance. As of the May 2007 distribution date,
the pool's aggregate certificate balance has been reduced 20.5% to
$502.8 million from $632.1 million at issuance.
Currently, two assets (3.3%) are in special servicing and
significant losses are expected. The largest specially serviced
asset (1.6%) is a retail center located in Sevierville, TN and is
currently real estate-owned. The special servicer is in the
process of obtaining a broker to market the property for sale.
The second specially serviced asset (1.7%) is secured by an
industrial property located in San Jose, California and is REO.
The property is currently under contract for sale.
MSGI SECURITY: Faces Delisting of Common Stocks from Nasdaq
-----------------------------------------------------------
MSGI Security Solutions Inc. was notified that the NASDAQ Stock
Market will delist the company's common stock, which was suspended
on Oct. 20, 2006, and has not traded on NASDAQ since that time.
NASDAQ will 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.
The company's stock is currently quoted on the OTCBB, and NASDAQ's
delisting determination is not an assessment of the eligibility of
the company's securities to continue quotation on that venue.
MSGI Security Solutions Inc. (Other OTC: MSGI) --
http://www.msgisecurity.com/-- provides of proprietary security
products and services to commercial and governmental organizations
worldwide, including the U.S. Department of Homeland Security,
with a focus on cutting-edge encryption technologies for
surveillance, intelligence monitoring, and data protection.
Going Concern Doubt
As reported in the Troubled Company Reporter on Jan. 4, 2007,
Amper, Politziner & Mattia PC expressed substantial doubt about
MSGI Security Solutions Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
years ended June 30, 2006, and 2005. The auditing firm pointed to
the company's recurring losses from operations, negative cash
flows from operations, and significant deficit in working capital
NATIONSTAR HOME: Moody's Rates Class M-10 Certificates at (P)Ba1
----------------------------------------------------------------
Moody's Investors Service assigned provisional ratings to the
senior certificates issued by Nationstar Home Equity Loan Trust
2007-C.
The Complete Provisional Rating Actions Are:
* Nationstar Home Equity Loan Trust 2007-C
* Nationstar Home Equity Loan Asset-Backed Certificates,
Series 2007-C
Class 1-AV-1, Assigned (P)Aaa
Class 2-AV-1, Assigned (P)Aaa
Class 2-AV-2, Assigned (P)Aaa
Class 2-AV-3, Assigned (P)Aaa
Class 2-AV-4, Assigned (P)Aaa
Class M-1, Assigned (P)Aa1
Class M-2, Assigned (P)Aa2
Class M-3, Assigned (P)Aa3
Class M-4, Assigned (P)A1
Class M-5, Assigned (P)A2
Class M-6, Assigned (P)A3
Class M-7, Assigned (P)Baa1
Class M-8, Assigned (P)Baa2
Class M-9, Assigned (P)Baa3
Class M-10, Assigned (P)Ba1
Class M-10 Certificates are being offered in a privately
negotiated transaction without registration under the 1933 Act.
The issuance was designed to permit resale under Rule 144A and, in
the case of certain certificates, under Regulation S.
Investors should be aware that the certificates have not yet been
issued. Upon issuance of the certificates and upon conclusive
review of all documents and information about the transaction, as
well as any subsequent changes in information, Moody's will
endeavor to assign definitive ratings, which may differ from the
provisional ratings.
NEWSTAR COMMERCIAL: Fitch Rates $29.1 Million Class Notes at BB
---------------------------------------------------------------
Fitch assigns these ratings to NewStar Commercial Loan Trust
2007-1:
-- $336,500,000 class A-1 floating rate notes, due 2022 'AAA';
-- $100,000,000 class A-2 floating rate notes, due 2022 'AAA';
-- $24,000,000 class B floating rate notes, due 2022 'AA';
-- $58,500,000 class C floating rate notes, due 2022 'A';
-- $27,000,000 class D floating rate notes, due 2022 'BBB+';
-- $29,100,000 class E floating rate notes, due 2022 'BB'.
NORANDA ALUMINUM: Notes Issuance Cues S&P to Lower All Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered all ratings on Noranda
Aluminum Holding Corp., including the long-term corporate credit
rating to 'B' from 'B+', after the company announced it intends to
issue $220 million of unsecured floating-rate notes to finance a
$211 million special dividend to its private equity owner, Apollo
Management L.P.
At the same time, Standard & Poor's assigned its 'CCC+' rating to
Noranda Aluminum's $220 million PIK toggle notes due 2014, based
on the issue's structural subordination relative to secured and
unsecured borrowings at the operating company level. The outlook
is stable.
"The company's financial policy is aggressive, as demonstrated by
the debt-financed special dividend that repaid almost all of the
equity sponsor's initial investment less than three weeks after
the company's leveraged acquisition," said Standard & Poor's
credit analyst Donald Marleau. "Noranda Aluminum's credit profile
is characterized by high debt leverage in light of the unstable
profitability caused by its exposure to cyclical aluminum prices,"
Mr. Marleau added.
Countering these weaknesses are the company's integration, which
ensures secure supply of critical inputs and contributes some
operating diversity, and as forward sales contracts that lock in
currently strong aluminum prices for about one-third of production
through 2010. Furthermore, Noranda Aluminum benefits from the
combination of cyclically high aluminum prices, and an improving
cost position relative to offshore competitors brought about by a
weaker U.S. dollar.
The stable outlook is predicated on aluminum markets and Noranda
Aluminum's cash flow remaining strong enough to reduce its
currently heavy debt burden. The use of forward sales contracts
provides considerable stability in projected cash flow, but the
company must preserve its ability to deliver metal under the
contracts. A further shift to a more aggressive financial stance
to support shareholder-friendly initiatives, such as increasing
debt to fund dividends, would likely contribute to a downgrade of
one or more notches for the corporate credit rating or the various
debt issues. On the other hand, the rating on the company is
likely constrained to the 'B' category in the absence of enhanced
operating diversity, measures to mitigate earnings volatility, or
a materially lower debt burden.
OSI RESTAURANT: Stockholders Approve Amended Merger Agreement
-------------------------------------------------------------
OSI Restaurant Partners Inc.'s stockholders adopted an agreement
and plan of merger dated Nov. 5, 2006, among the company, Kangaroo
Holdings Inc. and Kangaroo Acquisition Inc., as amended on May 21,
2007.
Kangaroo Holdings Inc. is controlled by an investor group
comprised of investment funds associated with Bain Capital
Partners LLC and investment funds affiliated with Catterton
Management Company LLC. OSI's founders, certain holders
associated with one of its founders and certain members of its
management are expected to exchange shares of OSI's common stock
for shares of Kangaroo Holdings Inc. in connection with the
merger.
The amended merger agreement was adopted by the holders of a
majority of OSI's outstanding common stock, as required by
Delaware law. In addition, the holders of a majority of the
number of shares of OSI's common stock held by holders that are
not participating holders voted for the adoption of the amended
merger agreement and the merger, as required by a condition to
closing under the amended merger agreement.
OSI expects that the transactions contemplated by the amended
merger agreement will be consummated on or prior to June 19, 2007,
subject to satisfaction of the conditions to closing under the
amended merger agreement.
Under the terms of the amended merger agreement, each outstanding
share of OSI's common stock (other than shares held in OSI's
treasury, shares owned by OSI's subsidiaries, Kangaroo Holdings
Inc. or Kangaroo Acquisition Inc. and shares held by stockholders
who perfect appraisal rights in accordance with Delaware law) will
be converted into the right to receive $41.15 in cash.
OSI's founders, Messrs. Sullivan, Basham and Gannon, have agreed
with Kangaroo Holdings Inc. that they will receive only $40.00 per
share in cash for their shares (other than shares they will be
contributing to Kangaroo Holdings Inc. in exchange for its stock,
which will be exchanged at a per share valuation of $40.00 per
share) in a sale transaction with a member of the investor group
consummated immediately prior to, but expressly conditioned upon,
the consummation of the merger.
About Bain Capital Partners
Bain Capital Partners LLC -- http://www.baincapital.com/-- is a
global private investment firm that manages several pools of
capital including private equity, venture capital, public equity
and leveraged debt assets with approximately $40 billion in assets
under management. Since its inception in 1984, Bain Capital has
made private equity investments and add-on acquisitions in over
230 companies around the world. Headquartered in Boston,
Bain Capital has offices in New York, London, Munich, Tokyo,
Hong Kong and Shanghai.
About Catterton
Catterton -- http://www.cpequity.com/-- is a private equity firm
in the U.S. focused exclusively on the consumer industry. Since
its founding in 1990, Catterton has leveraged its investment
capital, strategic and operating skills, and network of industry
contacts to establish one of the strongest investment track
records in the consumer industry.
About OSI Restaurant Partners
OSI Restaurant Partners, Inc.'s portfolio of brands consists of
Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill,
Fleming's Prime Steakhouse & Wine Bar, Roy's, Lee Roy Selmon's,
Blue Coral Seafood & Spirits and Cheeseburger in Paradise
restaurants. It has operations in 50 states and 20 countries
internationally.
OSI RESTAURANT: S&P Affirms Ratings and Removes Developing Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on Tampa,
Florida-based OSI Restaurant Partners Inc., including its 'B+'
corporate credit rating, and removed them from CreditWatch, where
they were placed on May 9, 2007, with developing implications.
The outlook is negative.
The CreditWatch listing reflected S&P's concern that a higher
priced bid would be financed with additional debt. The removal
from CreditWatch follows the company's announcement that its
stockholders adopted an amended merger agreement whereby shares
will be converted into $41.15 in cash, rather than the originally
expected $40 per share. The increased purchase price will be
funded with equity from the investor group, comprised of Bain
Capital Partners, Catterton Partners, and company founders and
management, that is purchasing OSI. S&P expect the transaction to
close by June 19, 2007.
"The negative outlook reflects leverage that is currently high for
the 'B+' rating," said Standard & Poor's credit analyst Jackie E.
Oberoi. Should OSI reduce leverage to less than 6.5x by the end
of 2007 through measures that include improvement in same-store
sales for OSI's core Outback Steakhouse concept and continued
success with recent expense reduction measures, a stable outlook
could result.
PINNACLE ENTERTAINMENT: Prices $385 Million Senior Notes Offering
-----------------------------------------------------------------
Pinnacle Entertainment Inc. has priced $385 million aggregate
principal amount of new 7.50% senior subordinated notes due 2015,
which will be issued in a private placement. The notes will be
issued at a price of 98.525% of par. The offering is scheduled to
close on June 8, 2007, subject to closing conditions.
The company intends to use a portion of the net proceeds of the
offering to repay all of its outstanding term loans under its
credit agreement. In addition, the company intends to use a
portion of the net proceeds of this offering to purchase
$25 million aggregate principal amount of its 8.25% senior
subordinated notes due 2012. The company expects to use the
remaining net proceeds from the offering for general corporate
purposes and to provide a portion of the funds needed for one or
more of its capital projects.
The new senior subordinated notes will not be registered under the
Securities Act of 1933 or any state securities laws and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
Headquartered in Las Vegas, Nevada, Pinnacle Entertainment Inc.
(NYSE: PNK) -- http://www.pnkinc.com/-- owns and operates casinos
in Nevada, Louisiana, Indiana and Argentina, owns a hotel in
Missouri, receives lease income from two card club casinos in
The Los Angeles metropolitan area, has been licensed to operate
a small casino in the Bahamas, and owns a casino site and has
significant insurance claims related to a hurricane-damaged casino
previously operated in Biloxi, Mississippi. Pinnacle opened a
major casino resort in Lake Charles, Louisiana in May 2005 and
a new replacement casino in Neuquen, Argentina in July 2005.
* * *
As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services assigned its 'B-' rating to
Pinnacle Entertainment Inc.'s proposed $350 million senior
subordinated notes due 2015.
On June 1, 2007, the Troubled Company Reporter related that Fitch
Ratings assigned a rating of 'B-/(Recovery Rating) RR5' to the
company's $350 million senior subordinated notes due 2015.
Pinnacle's credit ratings were: (i) Issuer Default Rating 'B';
(ii) Bank facility 'BB/RR1'; (iii)Senior Subordinated notes 'B-
/RR5'. The Rating Outlook is stable.
PITTSBURGH BREWING: Bankruptcy Court Confirms Reorganization Plan
-----------------------------------------------------------------
The Honorable M. Bruce McCullough of the U.S. Bankruptcy Court for
the Western District of Pennsylvania confirmed the reorganization
plan of Pittsburgh Brewing Co. Inc. and its debtor-affiliate,
Keystone Brewers Holding Co, according to various reports.
The reports disclose that the brewery will have a new name -- Iron
City Brewing Co. Its new owner, an investment group led by
private equity fund manager John N. Milne, will take over on
July 7, 2007. Approximately $4.1 million will be invested on the
brewery for marketing and upgrading plans.
As reported in the Troubled Company Reporter on March 2, 2007,
under the debtors' amended plan, administrative expense claims
will be paid in full. Allowed priority tax claims will be paid in
full with interest at 6% per annum.
The debtors expect that the aggregate amount of allowed
administrative expense claims, including those of Case
Professionals, will not exceed $2,682,000.
The allowed priority unsecured non-tax claim of UPMC Health Plan,
Inc., will be paid in equal monthly payments over five years and
commencing 90 days after the plan's effective date. Allowed
secured claims will also be paid in full with interest.
The debtors expect all other secured and priority claims not to
exceed $1,250,000, and cure amounts in the aggregate will not
exceed $50,000.
The plan proponents will attempt to negotiate an agreement with
the Official Committee of Unsecured Creditors regarding the
treatment of allowed general unsecured claims. In the event that
an agreement is reached, the plan will be amended to reflect that
agreement. In the event that no agreement is reached, general
unsecured creditors will receive nothing under the plan.
The debtors' distributors will receive no distribution on their
prepetition claims.
Joseph Piccirilli owns 44% of the debtors' equity interests. Jack
P. Cerone owns 20% of the debtors' equity interests. In addition,
there are approximately 75 additional holders of equity
interests who each hold less than 5% of the debtors' equity
interests. On the effective date, all equity interests will be
cancelled.
On the effective date of the plan, PBA will be issued 95% of the
membership interests in the reorganized debtor while Mr. Cerone
will be issued the remaining 5%.
Headquartered in Pittsburgh, Pennsylvania, Pittsburgh Brewing
Company Inc. -- http://www.pittsburghbrewingco.com/--
manufactures malt liquors, such as beer and ale. Its products
include Iron City Beer, IC Light Beer, and Augustiner Amber Lager.
The company filed for chapter 11 protection on Dec. 7, 2005
(Bankr. W.D. Penn. Case No. 05-50347). Robert O. Lampl, Esq., at
Law Office Robert O. Lampl, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, its assets and debts were estimated at $1 million
to $10 million. Keystone Brewers Holding Co, a holding company
for PBC's intellectual property assets, also filed a voluntary
chapter 11 petition on March 10, 2006.
PROBE MANUFACTURING: Inks Exclusive Partnership w/ HPV Technology
-----------------------------------------------------------------
Probe Manufacturing, Inc. has signed a manufacturing and marketing
agreement with HPV Technology LLC.
Pursuant to the agreement, Probe has the exclusive right to
manufacture the core electronic components for the HPV Acoustic
Hailing Devices. Additionally, Probe has the exclusive right to
market these devices to the Ballistic and Blast Protected and Mine
Resistant Ambush Protected vehicle manufacturers.
"This partnership underscores the advantages that Probe provides
to specialized technology companies who demand the highest quality
manufacturing services," said Probe CEO Reza Zarif. "Acoustic
Hailing Devices can provide potentially life saving technologies
to military personnel, especially when they are paired with
Ballistic and Blast Protected and Mine Resistant Ambush Protected
vehicles. We are enthusiastic about the opportunity that the MRAP
market presents for Probe."
Acoustic Hailing Devices are used for force protection when there
is a need to determine intent of persons, crowds, vessels or
vehicles at a safe distance, and to potentially deter them prior
to escalating to lethal force. Ballistic and Blast Protected and
Mine Resistant Ambush Protected vehicles are types of armored
fighting vehicles designed to survive improvised explosive device
attacks and ambushes. These vehicles are utilized by all branches
of the military and are currently deployed in Iraq and
Afghanistan.
"We are very exited to extend our existing relationship with Probe
Manufacturing," said HPV CEO Vahan Simidian II. "We see this
partnership as an important step in bringing our AHD products to
the expanding MRAP vehicle market."
About HPV Technologies
Based in Costa Mesa, California, HPV Technologies --
http://www.hpvtech.com/,http://www.getmad.com/-- manufactures
planer magnetic technologies for military applications.
About Probe Manufacturing
Based in Lake Forest, California, Probe Manufacturing, Inc.
(OTCBB:PMFI) -- http://www.probemi.com/-- was founded in 1995 and
is one of Southern California's highest quality, low to medium
volume Electronics Manufacturing Services companies. The company
provides a full range of electronics manufacturing and supply
chain management services to the some of the world's leading
aerospace, industrial, automotive, alternate fuel, hybrid, and
medical device manufacturing firms. The company provides OEMs
with low cost of ownership, flexibility, and quality that improves
their competitive advantage. The company is also in the process
of developing alternative fuel technologies that enable vehicles
and generators to operate on clean-burning alternative fuels.
Going Concern Doubt
Denver, Colorado-based Jaspers + Hall, P.C. raised substantial
doubt about Probe Manufacturing's ability to continue as a going
concern after reviewing the company's annual financial statements
for the fiscal year ended Dec. 31, 2006. The auditor pointed to
the company's accumulated deficit from operations and its
difficulties in maintaining sufficient working capital.
The company's balance sheet at Dec. 31, 2006 showed $2,286,121 in
total assets, $3,031,584 in total liabilities, and a stockholders'
deficit of $745,463, compared to $2,404,470 in total assets,
$3,454,119 in total liabilities, and a stockholders' deficit of
$1,049,649 at Dec. 31, 2005. The company had a working capital
deficit of $132,686 at Dec. 31, 2006, compared to a working
capital deficit of $135,609 at Dec. 31, 2005.
PUIG INC: Section 341(a) Meeting Scheduled on July 2
----------------------------------------------------
The U.S. Trustee for Region 21 will convene a meeting of Puig
Inc.'s creditors at 1:30 p.m., on July 2, 2007, at the Office of
the U.S. Trustee, 51 SW First Ave Room 1021, in Miami, Florida.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Puig Inc. in Hialeah, Florida, and its debtor-affiliates are
engaged in the condo conversion business. Historically, the
Debtors have purchased multi-family residential complexes,
remodeled the units, converted the projects to condominium
ownership and resold the units at retail. The Debtors filed for
chapter 11 protection on May 29, 2007 (Bankr. S.D. Fla. Lead Case
No. 07-14026). When the Debtors sought protection from its
creditors, they listed total assets and total debts between $1
Million to $100 Million.
PUIG INC: Taps Berger Singerman as General Counsel
--------------------------------------------------
Puig Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court
for the Southern District of Florida for authority to employ
Berger Singerman, P.A. as their counsel, nunc pro tunc to their
bankruptcy filing.
Berger Singerman will:
a. advise the Debtors with respect to their responsibilities
in complying with the U.S. Trustee's Guidelines and
Reporting Requirements and with the rules of the Court;
b. prepare motions, pleadings, orders, applications, adversary
proceedings, and other legal documents necessary in the
administration of the cases;
c. protect the interest of the Debtors in all matters pending
before the Court; and
d. represent the Debtors in negotiations with their creditors
and in the preparation of a plan.
The Debtors will pay Berger Singerman based on these current
hourly rates:
Designation Hourly Rate
----------- -----------
Associate Attorneys $220 - $330
Paralegals/Legal Assistants $75 - $160
Jordi Guso, Esq., who will be principally responsible for the
Debtors' cases, will be paid $435 an hour.
Prior to the commencement of these cases, the Debtors provided
Berger Singerman a $350,000 retainer. In addition, Berger
Singerman has retained the remaining $25,000 of the $30,000 pre-
bankruptcy retainer it received as a cost deposit for the expenses
it will incur in the cases.
The Debtors assure the Court that it is in the best interest of
the estates to retain Berger Singerman as their general counsel.
The firm can be reached at:
Jordi Guso, Esq.
Berger Singerman, P.A.
2650 North Military Trail, Suite 240
Boca Raton, Florida 33431
Telephone: (561) 241-9500
Fax: (561) 998-0028
http://www.bergersingerman.com/
Puig Inc. in Hialeah, Florida, and its debtor-affiliates are
engaged in the condo conversion business. Historically, the
Debtors have purchased multi-family residential complexes,
remodeled the units, converted the projects to condominium
ownership and resold the units at retail. The Debtors filed for a
chapter 11 protection on May 29, 2007 (Bankr. S.D. Fla. Case No.
07-14026). When the Debtors sought protection from its creditors,
they listed total assets and total debts between $1 Million to
$100 Million.
RESMAE MORTGAGE: Court Confirms Plan of Reorganization
------------------------------------------------------
The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware has confirmed ResMAE Mortgage Corporation's
Plan of Reorganization.
The ruling clears the way for the company to emerge from Chapter
11 as an entity wholly owned by an affiliate of Citadel Investment
Group, LLC. ResMAE expects the Plan to become effective on or
about June 15, 2007.
ResMAE commenced its Chapter 11 case on Feb. 12, 2007 and
announced an agreement to sell certain assets of the company to
affiliates of Citadel on March 6, 2007. The company has conducted
operations and originated loans throughout the Chapter 11 process.
In issuing his ruling, Judge Carey found that the company had met
all of the requirements necessary to exit from Chapter 11.
"T[he] decision represents a critical step for us as we move our
business forward with renewed energy and excitement about the
prospects of ResMAE and this important industry. The progress we
have made in the last several months speaks to the resolve of our
team along with the significant commitment that Citadel has made
to ResMAE," said Jack Mayesh, Chairman of ResMAE.
"ResMAE has built a solid platform in the sub-prime mortgage
industry. While the last several months have been trying for the
industry as a whole, we are on course to position ResMAE as an
industry leader," said Ken Griffin, President and CEO of Citadel.
About Citadel Investment
Citadel is one of the world's leading financial institutions
focused on alternative asset management strategies. The Citadel
group of companies employ over 1,000 professionals at headquarters
in Chicago and across its offices around the world, including New
York, San Francisco, London, Hong Kong and Tokyo.
About ResMAE Mortgage Corp.
Based in Brea, California, ResMAE Mortgage Corp. --
http://www.resmae.com/-- is a subsidiary of ResMAE Financial
Corp., a specialty finance company engaged in the business
of originating, selling, and servicing subprime residential
mortgage loans. The company serves the needs of borrowers who do
not conform to traditional "A" credit lending criteria due to
credit history, debt to income ratios, or other factors. It has
regional processing centers nationwide, including Northern and
Southern California, Texas, New Jersey, Illinois, Florida and
Hawaii.
ResMAE Mortgage filed for chapter 11 protection on
Feb. 12, 2007 (Bankr. D. Del. Case No. 07-10177). Daniel J.
DeFranceschi, Esq. and Mark D. Collins, Esq., at Richards, Layton
& Finger, P.A., represent the Debtor in its restructuring efforts.
Adam G. Landis, Esq., and Richard Scott Cobb, Esq., at Landis Rath
& Cobb LLP serve as counsel to the Official Committee of Unsecured
Creditors. At reporting month ended Feb. 28, 2007, the Debtor's
balance sheet showed total assets of $255,429,000 and total debts
of $254,062,000.
SCOTTISH RE: Fitch Lifts Issuer Default Rating to BB- from B+
-------------------------------------------------------------
Fitch Ratings has upgraded Scottish Re Group Ltd.'s (NYSE: SCT)
Issuer Default Rating to 'BB-' from 'B+' and the Insurer Financial
Strength ratings of its primary operating subsidiaries to 'BBB-'
from 'BB+'. The ratings have been removed from Rating Watch
Positive; the Rating Outlook is Stable.
The upgrade and removal from Rating Watch (where it was placed on
May 8, 2007) reflect the very strong capital position and much
improved liquidity following the completion of the $560 million
(net of expenses) investment transaction with MassMutual Capital
Partners LLC, and Cerberus Capital Management, L.P. Fitch
estimates SCT's pro forma combined risk-based capital was 376%
with securitizations and 345% excluding securitizations at March
31, 2007, which exceeds Fitch's rating expectations.
The company's liquidity position is much improved.
Approximately $275 million of the proceeds of the investment were
used to repay the Stingray Pass-Through Trust thus freeing up this
$325 million facility for standby liquidity. SCT expects to
finalize a financing facility of $555 million that will cover its
Regulation XXX collateral financing needs for new business written
in 2005 and 2006. Excess funds from the financing are expected to
provide adequate liquidity over the 2007-2009 planning period.
As first-quarter earnings performance and 2007 guidance reflect,
SCT continues to face uncertainties with regard to its business
and operating profile, following the liquidity crisis that led to
the MMC/Cerberus investment. Further, the company is actively
recruiting to fill a number a senior management positions vacated
since the close of the transaction.
Both prior to and as a result of the transaction, SCT has
instituted actions related to strengthening of processes for in-
force management and financial planning, governance and risk
management, operation efficiency and management oversight. Still,
the impact of these actions can only be substantiated over time
through successful execution under its financial and operating
plans.
The Stable Outlook reflects the implementation of solid balance
sheet and liquidity initiatives countered by the expectations of
continued after-tax operating losses over the next 12-18 months.
In order to move to a positive Outlook and higher ratings, SCT
will need to demonstrate its effectiveness in restoring its
operating profile and business franchise.
Fitch believes that the effect of positive ratings momentum could
be greater on the holding company, where notching was widened
during the 2006 crisis, and will depend on positive earnings and
restoring GAAP EBIT coverage levels.
Fitch has upgraded and removed these ratings from Rating Watch
Positive:
Scottish Re Group Ltd.
-- Issuer Default Rating to 'BB-' from 'B+';
-- 7.25% non-cumulative perpetual preferred stock to 'B/RR6'
from 'B-/RR6'.
Scottish Annuity & Life Insurance Company (Cayman) Limited
-- IFS rating to 'BBB-' from 'BB+'.
Scottish Re (U.S.) Inc.
-- IFS rating to 'BBB-' from 'BB+'.
Scottish Re Limited
-- IFS rating to 'BBB-' from 'BB+'.
Stingray Pass Through Trust
-- $325 million 5.902% collateral facility securities
due Jan. 12, 2015 to 'BBB-' from 'BB+'.
Fitch's Recovery Ratings are a relative indicator of creditor
recovery prospects on a given obligation within an issuers'
capital structure in the event of a default.
Scottish Re Group Ltd. -- http://www.scottishre.com/-- is a
global life reinsurance specialist. Scottish Re has operating
businesses in Bermuda, Grand Cayman, Guernsey, Ireland, the
United Kingdom, United States, and Singapore. Its flagship
operating subsidiaries include Scottish Annuity & Life Insurance
Company (Cayman) Ltd. and Scottish Re (US), Inc. Scottish Re
Capital Markets, Inc., a member of Scottish Re Group Ltd., is a
registered broker dealer that specializes in securitization of
life insurance assets and liabilities.
SEARS HOLDINGS: Solid Balance Sheet Cues Fitch to Affirm Ratings
----------------------------------------------------------------
Fitch Ratings has affirmed its ratings of Sears Holdings
Corporation (Holdings) as :
Sears Holdings Corporation
-- Issuer Default Rating (IDR) at 'BB';
-- Senior Notes at 'BB';
-- Secured Bank Facility at 'BBB-'.
Sears, Roebuck and Co. (Sears)
-- IDR at 'BB';
-- Senior Notes at 'BB'.
Sears Roebuck Acceptance Corp. (SRAC)
-- IDR at 'BB';
-- Senior Notes at 'BB';
-- Commercial Paper at 'B'.
Sears DC Corp.
-- IDR at 'BB'
-- Senior Notes at 'BB'.
The Rating Outlook is Stable. Approximately $2 billion of debt is
affected by these actions.
The affirmations reflect Holdings' broad market presence in the
moderate department store and discounter segments and solid
balance sheet balanced against soft operating results and
significant long-term competitive challenges.
Sears has posted comparable store sales declines for the past six
years reflecting competitive pressures and inconsistent
merchandising execution. Kmart's sales stabilized in 2005-2006
following three years of sharp declines, but were lower again in
the first quarter of 2007. Holdings' challenge will be to generate
longer-term sales and earnings growth at both Sears and Kmart in
the face of growing competition from the discounters and big box
specialty retailers. The company is attempting to create a
customer-oriented culture and is gradually remodeling its Kmart
stores while adding Sears' well-known brands into those stores.
This should support the turnaround effort, though the pace of
remodeling is cautious.
Despite weak sales, Holdings' operating earnings have been
supported by aggressive cost cutting and reduced promotional
activity. Nonetheless, profitability remains soft with EBITDA
margin at 6.7% in the twelve months ended May 5, 2007. Looking
ahead, earnings growth will be increasingly dependent on the
company's ability to generate sales increases.
Holdings continues to benefit from its relatively low leverage and
solid liquidity. Adjusted debt/EBITDAR and EBITDAR/interest plus
rents were 2.4 times (x) and 3.6x, respectively, in the twelve
months ended May 5, 2007. Liquidity is supported by a sizable cash
balance of $3.4 billion and a $4 billion revolver, of which
$3.8 billion was available as of May, 2007. This is more than
adequate for seasonal working capital needs that peak at around
$1.5 billion. While liquidity is solid, Fitch believes that the
company's investment guidelines, under which Chairman Eddie
Lampert has been given the authority to invest the company's
surplus cash in derivatives and other instruments, modestly raises
the company's risk profile.
Holdings' cash flow is projected to be sufficient to cover capital
expenditures, with free cash flow expected to be used for share
repurchases, acquisitions and debt reduction. Financial leverage
is projected to be flat to modestly lower going forward.
The 'BBB-' rating of Holdings' $4 billion secured revolver, under
which SRAC and Kmart are the borrowers, reflects a downstream
guarantee from Holdings to both SRAC and Kmart and cross-
guarantees between SRAC and Kmart. The facility is secured
primarily by inventories, which range from $9 billion-$11 billion.
The collateral can be released in the event the company achieves
certain performance targets or ratings levels. If the collateral
is released, leverage and asset coverage tests would become
effective.
The ratings of SRAC's senior notes and commercial paper reflect a
guarantee provided by Sears. In addition, Sears DC Corp. benefits
from an agreement by Sears to maintain a minimum fixed charge
coverage at SDC of 1.005 times. Sears also agrees to maintain
ownership of and a positive net worth at SDC.
SECUNDA INT'L: Moody's Places Low-B Ratings Under Review
--------------------------------------------------------
Moody's placed Secunda's B2 corporate family rating, B2 senior
secured rating (LGD 3; 48%), B2 probability of default rating, and
B3 Long Term Issuer Rating under review direction uncertain
following the announcement that J. Ray McDermott would be
acquiring substantially all of the assets of Secunda including 14
harsh-weather, multi-functional vessels for approximately $260
million. In addition, most of the employees and senior management
team of Secunda will be joining J. Ray McDermott.
As a result of the divestiture of substantially all assets,
Secunda will redeem the existing $125 million of senior secured
notes. The review reflects the need to allow for regulatory
approvals to be given in order for the transaction to close and
the notes to be redeemed. The transaction is expected to close
early in the third quarter.
Upon closing of the transaction and redemption of the notes,
Secunda's ratings will be withdrawn. However, in the event that
the divestiture and subsequent debt redemption does not take
place, Moody's could re-evaluate Secunda's ratings and outlook for
possible negative action to reflect the high unsustainable
leverage despite very solid sector fundamentals.
Headquartered in Nova Scotia, Canada, Secunda International Ltd.
-- http://www.secunda.com/-- is a wholly owned Canadian vessel
owner/operator with locations in the U.K. and Barbados. Secunda
is the leading supplier of marine support services to oil and
gas companies in one of the world's harshest marine environments
-- off the East Coast of Canada.
SOLECTRON CORP: Flextronics Merger Pact Cues Fitch's Pos. Watch
---------------------------------------------------------------
Following Solectron Corporation's (NYSE: SLR) announced agreement
to be acquired by Flextronics International Ltd. (Nasdaq: FLEX)
(Issuer Default Rating of 'BB+', on Rating Watch Negative by
Fitch) for $3.6 billion in a combination of cash and stock, Fitch
has placed these ratings for SLR on Rating Watch Positive:
-- Issuer Default Rating at 'BB-';
-- Senior unsecured debt at 'BB-';
-- Subordinated debt at 'B+'.
Additionally, Fitch has affirmed Solectron's senior secured bank
facility at 'BB+'. Fitch's actions affect approximately
$600 million in debt securities.
Resolution of the Rating Watch Positive will be determined by the
ultimate outcome of Flextronics's IDR and the final capital
structure of the combined company as well as any potential
guarantee of Solectron debt by Flextronics. However, Fitch
believes that Solectron's senior unsecured and subordinated
bondholders have an option to force redemption of the existing
bonds under a change of control provision. Consequently, Fitch
believes it is likely that Solectron's debt would be retired at or
soon after closing whereby Fitch would anticipate upgrading the
various notes and IDR by one notch, respectively, and withdrawing
the ratings at that time.
Flextronics proposed acquisition of Solectron is still subject to
customary closing conditions including regulatory and shareholder
approval but is anticipated to close before the end of calendar
2007. Solectron shareholders have an option to receive either
cash or stock in lieu of their shares, however total cash
consideration is limited to a minimum of 30% and a maximum of 50%
of total consideration.
As of March 2, 2007, Solectron's liquidity was sufficient and
supported by approximately $1.1 billion of unrestricted cash and
cash equivalents and an undrawn $350 million senior secured
revolving credit facility expiring August 2009.
Total debt as of March 2, 2007, was approximately $641 million and
consisted primarily of:
-- $450 million 0.5% convertible senior notes due 2034;
-- $150 million 8% senior subordinated notes due 2016.
SORIANO & FRIENDS: Case Summary & 11 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Soriano and Friends, Inc.
11591 Northwest 2nd Street
Suite 105
Miami, FL 33172
Tel: (239) 209-7502
Bankruptcy Case No.: 07-14297
Chapter 11 Petition Date: June 5, 2007
Court: Southern District of Florida
Debtor's Counsel: Robert A. Schatzman, Esq.
Adorno & Yoss, L.L.P.
2525 Ponce De Leon Boulevard, Suite 400
Miami, FL 33134
Tel: (305) 460-1000
Total Assets: $4,000,000
Total Debts: $3,208,700
Debtor's 11 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Merco Group at 22nd loan $1,490,000
Avenue, L.L.C.
2675 South Bayshore Drive
Miami, FL 33133
Yolanda Resto loan $360,000
215 Southwest 2nd Avenue
Miami, FL 33134
Tomas Del Calvo loan $240,000
15711 Southwest 66th
Territory
Miami, FL 33193
Adolfo & Carmelina Moya loan $200,000
Thomas J. Fitzpatrick loan $200,000
Rafael & Marcia Vidal/ loan $150,000
Jorge C. & Marta Perez
Pascual Riveron loan $100,000
Extreme Machinery trade debt $78,000
Rafael Hueso loan $75,000
Miami-Dade County property taxes $39,000
Juan & Jennifer Nunez loan $100,000
SR TELECOM: Posts CDN$12.2 Million Net Loss in Qtr. Ended March 31
------------------------------------------------------------------
SR Telecom Inc. reported a net loss of CDN$12.2 million for the
first quarter ended March 31, 2007, compared with a net loss of
CDN$13.6 million for the same period ended March 31, 2006.
SR Telecom's consolidated first quarter revenue grew 19% to
CDN$22.9 million from CDN$19.2 million in the same period in 2006.
This increase reflects the ongoing implementation of major
contracts in Mexico and Argentina as well as shipments for a new
wireless deployment in Algeria. Q1 2007 revenues were, however,
offset by outsourcing issues that delayed wireless product
shipments and resulted in CDN$1.2 million in late-delivery
penalties.
Operating loss from continuing operations was CDN$8.8 million in
the first quarter of 2007, a CDN$2.7 million improvement over the
CDN$11.5 million operating loss recorded in the same period one
year ago. The improvement in net loss and operating loss from
continuing operations are a result of the increase in sales
volume, higher margins on equipment sales due to a beneficial
shift in product mix, and a CDN$2.4 million decline in
restructuring charges, however offset by a CDN$1.5 million
increase in selling, general and administrative (SG&A) expenses
and a CDN$900,000 rise in research and development expenses.
The rise in SG&A expenses for Q1 2007 is mainly attributable to
higher costs related to the stock-based compensation plan
implemented in Q2 2006 as well as expenses incurred to resolve the
ongoing outsourcing issues. The R&D increase is a reflection of
the additional resources the company has devoted to the
development, delivery and deployment of WiMAX solutions.
The company's consolidated cash, including restricted cash, was
$11.0 million, down from $27.1 million at Dec. 31, 2006, and
reflecting the company's use of cash to fund current capital
requirements.
"The improved financial performance we achieved in the first
quarter is an encouraging indication that, despite the impact of
ongoing restructuring efforts, our global customers remain
confident in the quality of our wireless solutions and our ability
to deliver and deploy them," said Serge Fortin, president and
chief executive officer of SR Telecom. "Over the last several
months, we have taken decisive action to position ourselves to
grow in the global WiMAX market. It is clear, however, that our
capital issues must be resolved before SR Telecom can regain
sustainable positive momentum."
At March 31, 2007, the company's balance sheet showed
CDN$102.9 million in total assets, and CDN$102.6 million in total
liabilities, resulting in a CDN$321,000 total stockholders'
equity.
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?20ad
Going Concern Doubt
There is substantial doubt about the appropriateness of the use of
the going concern assumption because of the uncertainty concerning
the outcome of the company's financing initiatives and because of
the company's losses for the current and prior years, negative
cash flows, reduced availability of supplier credit and lack of
operating credit facilities.
For the quarter ended March 31, 2007, the company realized a net
loss of CDN$12.2 million (CDN$115.6 million for the year ended
Dec. 31, 2006) and used cash of CDN$12.4 million (CDN$45.2 million
for the year ended Dec. 31, 2006) in its continuing operating
activities.
About SR Telecom
Headquartered in Quebec, Canada, SR Telecom (TSX: SRX) --
http://www.srtelecom.com/-- delivers broadband wireless access
(BWA) solutions that enable service providers to deploy voice,
Internet and next-generation services in urban, suburban and
remote areas.
* * *
SR Telecom's long-term credit rating carries Standard & Poor's
Ratings Services' D rating.
STERLING CENTRECORP: OSC Confirms Shareholder Vote on Plan
----------------------------------------------------------
The Ontario Securities Commission has issued an order confirming
the requisite majority of the minority shareholder vote obtained
at Sterling Centrecorp Inc.'s Shareholders' Meeting held on
April 30, 2007.
The shareholder voting was held in order to pass the resolution
approving the Arrangement Agreement between the company and SCI
Acquisition Inc.
The Order directed that the company exclude the votes attaching
to the securities of the company held by two of the parties to the
support agreements from the calculation of the majority of the
minority, but the vote was nevertheless carried. The Order
otherwise dismissed the Application brought before the Commission
by First Capital Realty Inc. and Gazit Canada Inc.
When the company and SCI announced the going private transaction
contemplated by the Arrangement Agreement on Feb. 8, 2007, the
parties were of the view, that for the reasons stated in the
Management Information Circular calling the Shareholders' Meeting,
they did not expect that a competing offer would be made for the
company. However, on May 15, 2007, FCR made a conditional offer,
without due diligence, for all of the common shares of the company
at $1.62 per share as well as for the company's convertible
debentures. FCR has advised the company's Special Committee that
they would like to gain access to due diligence information, and
that if such access is granted, FCR may be prepared to raise their
per share offer price and waive their conditions.
The company has requested the consent of SCI to permit due
diligence access to FCR. SCI, notwithstanding the favourable
ruling received from the Commission, has agreed, in the interest
of trying to maximize shareholder value, to consent to the company
providing FCR with access to due diligence information, subject to
the signing of a confidentiality agreement.
About First Capital Realty
Based in Ontario, Canada, First Capital Realty (TSX: FCR)
-- http://www.firstcapitalrealty.ca/-- is an owner, developer and
operator of supermarket-anchored neighborhood and community
shopping centers, located in growing metropolitan areas. The
company currently owns interests in 161 properties, including
7 under development, with approximately 18.9 million square feet
of gross leasable area. In addition, the company owns
13.9 million shares of Equity One (NYSE: EQY), one of the shopping
center REITS in the southern U.S. Including its investments in
Equity One, the company has interests in 334 properties totaling
approximately 36.8 million square feet of gross leasable area.
About Sterling Centrecorp Inc.
Based in Ontario, Canada, Sterling Centrecorp Inc. (TSX:
SCF) -- http://www.sterlingcentrecorp.com/-- is a North American
real estate investment and management services company
specializing in the retail property sector. Sterling, through its
North American platform, uncovers and secures real estate
opportunities and then aligns itself with strategic financial
partners to maximize returns for all parties. The company has
offices located in Toronto, Edmonton, and Montreal, and its U.S.
subsidiary has offices located in West Palm Beach, Charlotte,
Dallas, San Antonio, and Scottsdale.
STRUCTURED ASSET: S&P Cuts Ratings and Retains Negative Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class B-1 and B-2 mortgage pass-through certificates from
Structured Asset Securities Corp.'s series 2003-BC1. Both ratings
remain on CreditWatch with negative implications, where they were
placed March 26, 2007. At the same time, S&P affirmed the ratings
on classes M-1 and M-2 from the same series.
The downgrades reflect the continued erosion of
overcollateralization, as monthly net losses consistently outpace
monthly excess interest. As a result, O/C is 1.91% of original
pool balance, well below its target of 4.75% of the original pool
balance. In addition, O/C could not step down because the
cumulative realized loss and delinquency triggers have both been
breached. As of the May 2007 distribution report, total
delinquencies were 34.57%, with severe delinquencies (90-plus day,
foreclosures, and REOs) of 24.14%. Cumulative realized losses
were 9.40% of original pool balance. The transaction is 50 months
seasoned and has paid down to just under 20% of its original pool
balance.
The affirmed ratings reflect adequate actual and projected credit
support, mostly in the form of subordination of the B-1 and B-2
classes.
Standard & Poor's will continue to closely monitor the performance
of this transaction. If losses decline to a point at which they
no longer exceed excess interest, and the level of O/C has not
been further eroded, S&P will affirm the ratings and remove them
from CreditWatch. Conversely, if losses continue to exceed excess
interest and further erode O/C, S&P will take additional negative
rating actions.
The collateral for this transaction consists of 30-year fixed- or
adjustable-rate reperforming mortgage loans secured by first liens
on one- to four-family residential properties.
Ratings Lowered and Remaining on Creditwatch Negative
Structured Asset Securities Corp.
Mortgage pass-through certificates series 2003-BC1
Rating
------
Class To From
----- -- ----
B-1 BB/Watch Neg BBB-/Watch Neg
B-2 B/Watch Neg BB-/Watch Neg
Ratings Affirmed
Structured Asset Securities Corp.
Mortgage pass-through certificates series 2003-BC1
Class Rating
----- ------
M-1 AA
M-2 A
TD AMERITRADE: Jana & S.A.C. Suggests Merger to Boost Value
-----------------------------------------------------------
TD Ameritrade Holding Corp. disclosed in a regulatory filing the
U.S. Securities and Exchange Commission that on May 29, 2007, the
company's board of directors received a letter from two hedge
funds, Jana Partners and S.A.C. Capital Advisors.
In the letter, Jana Partners and S.A.C. Capital notified the
company that their funds have an aggregate "economic interest" in
approximately 50 million shares of TD Ameritrade, amounting to
8.4% of the outstanding stock. The hedge funds also told the
company that they each plan to seek regulatory approval to acquire
additional shares in excess of $600 million. Jana and S.A.C. also
said that they wish for the company to pursue a business
combination with one of its industry peers.
Specifically, the two hedge funds said that a combination with
E*Trade Financial or Charles Schwab could dramatically increase
the company's long-term shareholder value. Jana and S.A.C.
further said that representatives of The Toronto-Dominion Bank on
the company's board could stand in the way of this plan.
The company discloses that its board continually reviews its
business plan and stand-alone strategy, as well as potential
strategic combinations with peers in the industry.
The company also relates that public disclosure shows that
Toronto-Dominion owns approximately 40% and the Ricketts own
approximately 21% of the outstanding capital stock of the company.
Under the terms of the stockholders agreement entered into in
connection with the shareholder approved acquisition of TD
Waterhouse, the board is comprised of twelve members, five
designated by Toronto-Dominion, three designated by the Ricketts,
three outside independent directors and our chief executive
officer. The ownership position and limited governance rights of
The Toronto-Dominion Bank are disclosed to shareholders in SEC
filings.
TD Ameritrade Holding Corp., fka Ameritrade Holding Corporation -
http://www.amtd/-- (NASDAQ:AMTD) provides securities brokerage
services and technology-based financial services to retail
investors and business partners, predominantly through the
Internet, a national branch network and relationships with a
network of independent registered investment advisors. The
company's client offerings include TD AMERITRADE, TD AMERITRADE
Institutional, TD AMERITRADE Izone, Amerivest and Ameritrade
Corporate Services.
* * *
As reported in the Troubled Company Reporter on Feb. 6, 2007,
Fitch Ratings upgraded the long-term rating of TD Ameritrade
Holding Corporation's senior debt term-loan borrowings to 'BB+'
from 'BB'. At the same time, the long-term Issuer Default Rating
was affirmed at 'BB+'. The Rating Outlook remains Positive for
both the senior debt and the IDR.
TD AMERITRADE: Appoints Fredric Tomczyk as Chief Operating Officer
------------------------------------------------------------------
TD Ameritrade Holding Corp. reported that on June 5, 2007, Fredric
J. Tomczyk, one of the designees of The Toronto-Dominion Bank,
resigned as a director of TD Ameritrade Holding Corporation to
become the company's chief operating officer, effective July 2,
2007.
Mr. Tomczyk is also resigning his position at TD Bank Financial
Group.
Prior to joining the company, Mr. Tomczyk, age 51, served as Vice
Chair of Corporate Operations for TD Bank Financial Group, a
position he held since May 2002. From March 2001, Mr. Tomczyk
served as Executive Vice President of Retail Distribution for TD
Canada Trust and from September 2000 until March 2001 served as
Executive Vice President and later as President and Chief
Executive Officer of Wealth Management for TD Bank Financial
Group. Prior to joining TD Bank Financial Group, he was President
and Chief Executive Officer of London Life.
New Directors
On June 5, 2007, Thomas J. Mullin, a designee of The Toronto-
Dominion Bank, was elected to the company's board under the terms
of the stockholders agreement among the company, Toronto-Dominion
and the Ricketts shareholders. Mr. Mullin will serve as a member
of the audit committee in the place of Wilbur J. Prezzano.
Marshall A. Cohen will take Mr. Tomczyk's place as a member of the
corporate governance committee. Allan R. Tessler will serve as
the chair of the corporate governance committee in the place of
Mr. Tomczyk, and W. Edmund Clark will take Mr. Tomczyk's position
as chair of the HR and compensation committee.
TD Ameritrade Holding Corp., fka Ameritrade Holding Corporation -
http://www.amtd/-- (NASDAQ:AMTD) provides securities brokerage
services and technology-based financial services to retail
investors and business partners, predominantly through the
Internet, a national branch network and relationships with a
network of independent registered investment advisors. The
company's client offerings include TD AMERITRADE, TD AMERITRADE
Institutional, TD AMERITRADE Izone, Amerivest and Ameritrade
Corporate Services.
* * *
As reported in the Troubled Company Reporter on Feb. 6, 2007,
Fitch Ratings upgraded the long-term rating of TD Ameritrade
Holding Corporation's senior debt term-loan borrowings to 'BB+'
from 'BB'. At the same time, the long-term Issuer Default Rating
was affirmed at 'BB+'. The Rating Outlook remains Positive for
both the senior debt and the IDR.
THERMACLIME INC: Operating Improvements Cue S&P's Positive Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on
ThermaClime Inc., including its 'B-' corporate credit rating, on
CreditWatch with positive implications. The company had total
debt, fully adjusted for operating leases, of $136 million at
March 31, 2007.
"The CreditWatch listing reflects meaningful improvements in the
company's operating results and credit measures over the past
several quarters," said Standard & Poor's credit analyst
Sean McWhorter.
ThermaClime experienced year-over-year EBITDA growth of 50% during
2006 primarily due to robust growth in its climate control
business, particularly in the geothermal and water source heat
pump segment. This positive momentum continued into 2007 with
first-quarter EBITDA increasing 60% because of continued strong
demand for its climate control products and a surge in sales of
agricultural chemicals. As a result, EBITDA interest coverage
improved to 3.4x from 2.1x, while debt-to-EBITDA declined to 2.7x
as of March 31, 2007, from a peak of 7.6x.
"In resolving the CreditWatch listing, we will evaluate the
company's prospects for sustaining its recent operating
improvements," Mr. McWhorter said. "We will also consider the
company's financial and operating strategies."
TL HOLDINGS: Financial Risk Cues S&P to Assign B Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating and stable outlook to TL Holdings II LP, a company
formed to enable private equity firm Apax Partners to purchase
Thomson Learning Inc. from The Thomson Corp. (A-/Watch
Neg/--).
At the same time, S&P assigned a 'B+' rating, with a recovery
rating of '1', to the $300 million revolving credit facility due
2013 of TL Acquisitions Inc., a newly formed holding company that
directly owns operating company Thomson Learning, indicating S&P
high expectation of full recovery of principal in the event of a
payment default. S&P also assigned a 'B' rating , with a recovery
rating of '2', to TL Acquisitions' $3.44 billion term loan B due
2014, indicating S&P expectation of substantial (80%-100%)
recovery of principal in the event of a payment default.
Although both facilities have a first lien on all collateral, the
revolving credit facility holds a superpriority position in the
disposition of proceeds from the collateral in the event of a
default.
Standard & Poor's also assigned its 'CCC+' ratings to TL
Acquisitions' $1.35 billion senior pay-in-kind (PIK) toggle notes
due 2015 and $250 million senior subordinated notes due 2017. The
senior unsecured PIK toggle notes are rated two notches below the
corporate credit rating because of the significant amount of
secured debt in the capital structure as a percentage of total
assets, and the resultant minimal residual value in a downside
scenario.
Standard & Poor's also assigned its 'CCC+' ratings to the
$540 million senior PIK notes due 2017 of TL US Holdco Inc.
Thomson Learning, a Stamford, Connecticut-based educational
publisher, had $5.58 billion in pro forma total debt at March 31,
2007.
"The ratings reflect high financial risk resulting from the
leveraged acquisition of Thomson Learning," said Standard & Poor's
credit analyst Hal F. Diamond. "The risk is only slightly offset
by the company's strong business position in the educational
publishing industry and its stable operating performance."
TRIBUNE CO: Chandler Trusts Agents Resign as Board Members
----------------------------------------------------------
Tribune Company disclosed the resignations of three board members:
Jeffrey Chandler, Roger Goodan and William Stinehart, Jr., each of
whom was serving on the board of directors as a representative of
the Chandler Trusts. The three directors had agreed to resign
their board seats upon completion of Tribune's tender offer which
expired on May 24, 2007.
Tribune's board of directors now includes nine members: Dennis J.
FitzSimons, Tribune chairman, president and chief executive
officer; Enrique Hernandez, Jr.; Betsy D. Holden; Robert S.
Morrison; William A. Osborn; J. Christopher Reyes; Dudley S. Taft;
Miles D. White; and Samuel Zell.
Mr. Zell was elected to the board on May 9, 2007, and will become
chairman of the board upon completion of Tribune's going-private
transaction, which is expected to occur in the fourth quarter of
2007. Mr. FitzSimons, as Tribune president and chief executive
officer, will remain a member of the board, which is expected to
consist of nine directors. The remainder of the board will
include at least five independent directors and an additional
director affiliated with Mr. Zell.
The Chandler Trust representatives were elected to the board in
2000 when Tribune acquired The Times Mirror Company. Prior to the
tender offer, the Chandler Trusts held approximately 48.1 million
shares of Tribune common stock, representing about 20% of total
shares outstanding. After the tender offer, the Chandler Trusts
held approximately 20.4 million shares, representing about 17% of
shares outstanding.
Chandler Trust No. 1 and Chandler Trust No. 2 and certain
affiliated stockholders have agreed to sell all remaining Tribune
shares through a block trade underwritten by Goldman Sachs & Co.
The shares will be offered pursuant to the shelf registration
statement that Tribune filed with the Securities and Exchange
Commission and that became effective on April 25, 2007. Tribune
will not receive any proceeds from this transaction.
Since Tribune filed its shelf registration statement on April 25,
2007, all of the shares of common stock that were issued in the
name of Chandler Trust No. 2 have been allocated among Chandler
Trust No. 2's 19 subtrusts. The 19 subtrusts are now the record
and beneficial owners of those respective shares: Philip Chandler
Residuary Trust No. 2, May C. Goodan Trust No. 2, Ruth C. Von
Platen Trust No. 2, Dorothy B. Chandler Marital Trust No. 2,
Dorothy B. Chandler Residuary Trust No. 2, HOC Trust No. 2 FBO
Scott Haskins, HOC Trust No. 2 FBO John Haskins, HOC Trust No. 2
FBO Eliza Haskins, HOC GST Exempt Trust No. 2. FBO Scott Haskins,
HOC GST Exempt Trust No. 2. FBO John Haskins, HOC GST Exempt
Trust No. 2. FBO Eliza Haskins, Alberta W. Chandler Marital Trust
No. 2, Earl E. Crowe Trust No. 2, Patricia Crowe Warren Residuary
Trust No. 2, Helen Garland Trust No. 2, for Gwendolyn Garland
Babcock, Helen Garland Trust No. 2, for William M. Garland III,
Helen Garland Trust No. 2, for Hillary Duque Garland, Garland
Foundation Trust No. 2 and Marian Otis Chandler Trust No. 2.
The issuer has filed a registration statement with the SEC for the
offering to which this communication relates.
About Tribune Company
Headquartered in Chicago, Tribune Company (NYSE: TRB) --
http://www.tribune.com/-- is one of the country's top media
companies, operating businesses in publishing, interactive and
broadcasting. It reaches more than 80% of U.S. households
and is the only media organization with newspapers, television
stations and websites in the nation's top three markets. In
publishing, Tribune's leading daily newspapers include the Los
Angeles Times, Chicago Tribune, Newsday (Long Island, NY), The Sun
(Baltimore), South Florida Sun-Sentinel, Orlando Sentinel and
Hartford Courant. The company's broadcasting group operates 23
television stations, Superstation WGN on national cable, Chicago's
WGN-AM and the Chicago Cubs baseball team.
* * *
As reported in the Troubled Company Reporter on April 25, 2007,
Moody's Investors Service downgraded Tribune Company's Corporate
Family rating to Ba3 from Ba1, existing senior unsecured notes to
B2 from Ba1, and subordinated notes to B2 from Ba2. The rating
actions reflect the significant increase in leverage that will
result from Tribune's repurchase of approximately $4.2 billion of
common stock through a tender offer in the first step of its plan
to go private, and that the increase in leverage is occurring at a
time of pressure on Tribune's advertising revenue and operating
margins.
W&T OFFSHORE: Moody's Rates $450 Mil. Sr. Unsec. Notes at B3
------------------------------------------------------------
Moody's assigned a B3 rating (LGD5; 76%) to W&T Offshore, Inc.'s
pending $450 million senior unsecured note offering and affirmed
its B2 corporate family rating.
Per Moody's Loss Given Default methodology, WTI's existing senior
secured Term Loan B and bank revolver are upgraded from B1 to Ba2
(LGD2; 22%) and the probability of default rating is upgraded from
B3 to B2.
The outlook is stable. Expected further significant 2007 debt
reduction offsets, for now, the negative impact of sharply higher
reserve replacement costs. WTI reports it will retire the
remainder of Term Loan B this year, cash flow permitting. The
outlook may turn negative in 2007 if:
(i) WTI changes course on debt reduction (excluding
acquisitions);
(ii) increases leverage on proven developed reserves with
acquisitions, and/or
(iii) incurs materially unfavorable sequential quarter
production and cost trends.
Note proceeds will repay remaining Term Loan A mandatory payments,
term out bank revolver borrowings, and prepay part of Term Loan B.
The secured facilities are secured pari passu by roughly 90% of
WTI's reserves during the first year of the facility, falling to
80% after 18 months of amortization.
The ratings are supported by a still strong price environment;
seasoned management team management's long exploration,
development, exploitation, production, and acquisition history in
the shallow waters of the GOM; and wide diversification across the
GOM, a region whose production is annually impacted to one degree
or another by extreme weather damage to onshore and offshore
production infrastructure. WTI has also reduced leverage on PD
reserves from over $11/Boe of PD reserves to approximately
$7.22/proven developed boe on a pro-forma basis on debt reductions
from cash flow and over $300 million of equity issued in July
2006.
WTI has consistently grown in scale through over 20 years of GOM
operations, principally by asset acquisitions and subsequent
exploitation and development and it currently has an equity market
value of $2.27 billion. Since 1999, WTI has executed six
significant acquisitions. Since 2000, it has consistently grown
proven reserves and, other than 2005 when Hurricanes Rita and
Katrina interrupted production, it has consistently grown
production. WTI's sole focus is the GOM, mostly in GOM shelf
waters where it has mostly drilled to traditional geologic depths
of less than 10,000 feet below the sea floor. Although WTI is not
regionally diversified, it is reasonably well-diversified within
GOM. In recent years, WTI has initiated activity in the
operationally and geologically far more challenging and costly
deep waters of the GOM and the deeper geologic horizons of the
shallow water GOM shelf. A rising proportion of drilling activity
and capital spending targets horizons from 10,000 feet to 15,000
feet deep and deepwater locations.
The ratings are restrained by high leverage, low diversification,
high costs, a short PDP reserve life, and production shut in risk.
Total reserve leverage exceeds $14/Boe of proven reserves, given
substantial SFAS 69 development and plugging and abandonment
outlays on proven undeveloped, proven developed non-producing, and
PDP reserves. All reserves and production are concentrated in the
offshore GOM, rendering a concentration of high drilling and
development capital costs, drilling risk, delay risk, and
production phase risk on a comparatively low (relative to onshore)
population of producing wells and drilling prospects. WTI
displays very high capital intensity, requires sustained heavy
capital spending, has a heavy embedded SFAS 69 cost burden, unit
full-cycle costs in the range of $43/boe, and short PDP and PD
reserve lives of 1.8 years 3.7 years, respectively.
While the insertion of $450 million of non-amortizing debt in
place of amortizing debt aids liquidity, it also embeds
substantial debt on a short-lived reserve base. WTI has a proven
developed producing reserve life of just 1.8 years and a PD
reserve life of 3.7 years. Its high reserve replacement costs and
short life combine for high capital intensity. Added to debt,
WTI's proportionately large SFAS 69 development and plugging and
abandonment costs yield leverage of $14.38/boe on total proven
reserves.
Per Moody's global ratings methodology for independent exploration
and production firms, WTI's pro-forma operating, cost, leverage,
and strategy profiles map to a B3 Corporate Family Rating.
However, significant leverage reduction trends and an expected
strong price environment support the higher ratings at this point.
Partly due to heavy diversion of cash flow to debt reduction
instead of reinvestment, total proven reserves declined from WTI's
announced 135 mmboe of reserves, at the time of its mid-2006 Kerr-
McGee reserve acquisition, to 122 mmboe of reserves by year-end
2006. PD reserves fell from 91.8 mmboe to 80mmboe. Production and
reserve scale and diversification map to a mixture of Ba and B
rating ranges, while reserve replacement and full cycle costs map
to the Caa range. Pro-forma leverage on PD reserves maps to a B
rating range while pro-forma leverage on total proven reserves
maps to the Caa range.
The geologically mature shallow waters of the GOM yield high
finding and development costs. High quality reservoir sands and
increasingly small new reservoir additions yield flush production
but exceptionally short PDP reserve lives. The sector's ever-
smaller finds per well, steep production decline per well, and
infrastructure challenges complicate WTI's ability to meet
production targets and control production and reserve replacement
costs. In that regard, first quarter 2007 average daily
production was down 8.5% versus the fourth quarter of 2006. WTI
cites third party issues and delays as a primary reason for the
lower than expected production. Together with its 1.8 year PDP
reserve life, those factors combined for an almost 8% decline in
first quarter production from forth quarter 2006. For well-
diversified firms, particularly those with longer PDP reserve
lives, such issues may be diversified away by steady production,
or unexpected upside production, in the rest of the portfolio.
Regarding costs, 3-year reserve replacement costs rose sharply in
2006 as low 2003 costs rolled off and sharply higher 2006 costs
rolled in to the 3-year average. Combined 1-year 2006 drillbit
finding and development costs of $35/boe (up sharply from 2005's
$23.07) and high Kerr-McGee GOM acquisition costs drove 1-year
all-sources reserve replacement costs from $21/boe in 2005 to
$31/boe in 2006 and 3-year all sources costs to $26.98/boe. First
quarter 2006 production costs increased to a high $12.21/boe
($10.89/boe without hurricane remediation expenses), up
significantly from prior quarters.
From the time of our initial 2006 rating, WTI's ratings have
benefited from a very aggressive mandatory debt repayment
schedule. However, Moody's also commented that WTI's very short
PDP reserve life and diversion of substantial cash flow to debt
reduction left its production trend with reduced margin of error
for drilling failures, development or tie-in delays, or further
shut-in production. Before the KMG acquisition, WTI operated with
very low debt and conservative debt policy partly borne of the
lesser debt capacity and higher risk of GOM properties.
W&T Offshore is headquartered in Houston, Texas.
WACHOVIA BANK: Moody's Rates Classes J & K Certificates at Low-B
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 17 classes of
Wachovia Bank Commercial Mortgage Trust, Commercial Mortgage Pass-
Through Certificates, Series 2005-C21 as:
-- Class A-2PFL, $425,180,267, affirmed at Aaa;
-- Class A-3, $183,113,000, affirmed at Aaa;
-- Class A-PB, $148,638,000, affirmed at Aaa;
-- Class A-4, $917,453,000, affirmed at Aaa;
-- Class A-1A, $347,070,698, affirmed at Aaa;
-- Class A-M, $325,017,000, affirmed at Aaa;
-- Class A-J, $215,323,000, affirmed at Aaa;
-- Class IO, Notional, affirmed at Aaa;
-- Class B, $65,003,000 affirmed at Aa2;
-- Class C, $32,502,000, affirmed at Aa3;
-- Class D, $60,941,000, affirmed at A2;
-- Class E, $36,564,000, affirmed at A3;
-- Class F, $40,627,000, affirmed at Baa1;
-- Class G, $32,502,000, affirmed at Baa2;
-- Class H, $40,627,000, affirmed at Baa3;
-- Class J, $16,250,000, affirmed at Ba1;
-- Class K, $16,251,000, affirmed at Ba2.
As of the May 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 7.8%
to $3.0 billion from $3.3 billion at securitization. The
Certificates are collateralized by 228 loans, ranging in size from
less than 1.0% to 6.5% of the pool, with the top 10 loans
representing 38.8% of the pool. The pool includes four investment
grade shadow rated loans, representing 6.9% of the
pool.
The pool has not realized any losses since securitization and
currently there are no loans in special servicing. Thirty-one
loans, representing 4.5% of the pool, are on the master servicer's
watchlist.
Moody's was provided with year-end 2006 operating results for
96.0% of the pool. Moody's weighted average loan to value ratio
for the conduit component is 101.4%, compared to 103.3% at
securitization. Moody's is affirming all classes due to stable
overall pool performance.
The largest shadow rated loan is the Extra Space Teamsters Pool
Loan ($92.1 million -- 3.0%), which is secured by a portfolio of
28 self storage properties located in 16 states. The portfolio was
86.9% occupied as of year-end 2006, compared to 83.3% at
securitization. Moody's current shadow rating is A3, the same as
at securitization.
The second largest shadow rated loan is the VRS Pool Loan ($52.1
million -- 1.7%), which is secured by a portfolio of 22 self
storage facilities located in 14 states. The portfolio was 85.5%
occupied as of year-end 2006, compared to 82.2% at securitization.
Moody's current shadow rating is Aa1, the same as at
securitization.
The third largest shadow rated loan is the 110 North Wacker Drive
Loan ($46.9 million -- 1.6%), which is secured by a 226,800 square
foot Class A office building located in downtown Chicago. The
property is 100.0% leased by General Growth Management, Inc.
through October 2019. Moody's current shadow rating is Baa3, the
same as at securitization.
The fourth largest shadow rated loan is the Presidential Tower
Loan ($14.5 million -- 0.5%), which is secured by a 145-unit
student housing property located in Champaign, Illinois. Moody's
current shadow rating is Baa3, the same as at securitization.
The top three conduit loans represent 17.3% of the pool. The
largest conduit loan is the NGP Rubicon GSA Pool Loan ($194.5
million -- 6.5%), which represents a 50.0% participation interest
in a first mortgage loan secured by a portfolio of 14 properties.
The portfolio consists of 13 office buildings totaling 1.9 million
square feet and a 1.0 million
square foot distribution center. As of September 2006 the
portfolio was 97.6% leased, compared to 89.8% at securitization.
Moody's LTV is 92.3%, compared to 103.7% at securitization.
The second largest conduit loan is the 1000 and 1100 Wilson
Boulevard Loan ($182.5 million -- 5.7%), which represents a 50.0%
participation interest in a first mortgage loan secured by two
Class A office buildings totaling 1.0 million square located in
downtown Arlington, Virginia. The two buildings are linked by a
66,000 square foot retail component. The complex was 96.0%
occupied as of September 2006, compared to 92.0% at
securitization. Moody's LTV is 117.2%, the same as at
securitization.
The third largest conduit loan is the Abbey Pool Loan ($142.6
million -- 4.8%), which is secured by a portfolio of 20 retail,
office, industrial and mixed use properties totaling 1.7 million
square feet. All of the properties are located in California. The
portfolio was 91.4% occupied as of year-end 2006, essentially the
same as at securitization. Moody's LTV is 99.4%, compared to
108.0% at securitization.
WAMU MORTGAGE: Moody's Rates Classes B-9 & B-10 Certs. at Low-B
---------------------------------------------------------------
Moody's Investors Service assigned a Aaa rating to the senior
certificates issued by WaMu Mortgage Pass-Through Certificates,
WMALT Series 2007-OA4, and ratings ranging from Aa1 to B2 to
the subordinate certificates in the deal.
The securitization is backed by adjustable-rate, negatively
amortizing Alt-A residential mortgage loans acquired by Washington
Mutual Mortgage Securities Corp. The collateral was originated by
Plaza Home Mortgage, Inc., First Magnus Financial Corporation, and
other originators, none of which originated more than 10% of the
mortgage loans. The ratings are
based primarily on the credit quality of the loans and on the
protection against credit losses provided by subordination.
Moody's expects collateral losses to range from 1.20% to 1.40%.
Washington Mutual Bank and Countrywide Home Loans, Inc. will
service the loans and Washington Mutual Mortgage Securities Corp.
will act as master servicer. Moody's has assigned Countrywide
Home Loans, Inc. its top servicer quality rating of SQ1 as a
primary servicer of prime loans. Furthermore, Moody's has
assigned Washington Mutual Mortgage Securities Corp. its servicer
quality rating of SQ2+ as master servicer.
The complete rating actions are:
* WaMu Mortgage Pass-Through Certificates Series 2007-OA4
Trust
* WaMu Mortgage Pass-Through Certificates, WMALT Series
2007-OA4
Class A-1A, Assigned Aaa
Class A-1B, Assigned Aaa
Class A-1C, Assigned Aaa
Class A-1D, Assigned Aaa
Class X-PPP, Assigned Aaa
Class B-1, Assigned Aa1
Class B-2, Assigned Aa1
Class B-3, Assigned Aa1
Class B-4, Assigned Aa1
Class B-5, Assigned Aa2
Class B-6, Assigned A2
Class B-7, Assigned Baa1
Class B-8, Assigned Baa3
Class B-9, Assigned Ba2
Class B-10, Assigned B2
Class R, Assigned Aaa
WARNER MUSIC: Fitch Comments on Risk of Potential Bid for EMI
-------------------------------------------------------------
While it is currently uncertain whether Warner Music Group Corp.
(Warner; IDR rated 'BB-' with a Stable Outlook by Fitch) will make
a competing bid for EMI Group Plc (EMI), any theoretical bid for
EMI would likely result in a Rating Watch Negative for Warner's
ratings and its subsidiaries, according to Fitch Ratings.
EMI recently accepted an offer of approximately $6.4 billion from
private equity firm Terra Firma (including the assumption of
approximately $1.6 billion of net debt). The risks and mitigating
factors of Warner making an offer have always been factored into
Fitch's ratings of Warner and its subsidiaries.
While the ratings on the individual debt securities would also
likely be placed on Rating Watch Negative under such a scenario,
Fitch points out several mitigating factors for lenders of all
debt security classes within Warner. These include uncertainty
regarding regulatory approval, potential cost-saving synergies,
potential asset sale proceeds, and, importantly, covenant packages
in existing debt documents that could make a significantly debt-
financed acquisition difficult without redeeming existing debt or
getting concessions from such holders.
Fitch believes this last point should provide some level of
protection for existing Warner and subsidiary lenders. Warner's
operating subsidiary, WMG Acquisition Corp., has a secured bank
facility that contains several financial covenants that would be
out of compliance should Warner incur material amounts of
additional debt.
For example, the facility contains a maximum leverage ratio of
4.85 times, which Fitch estimates Acquisition currently has less
than $500 million additional debt capacity. Further, indentures
governing Notes issued by Acquisition and its parent company, WMG
Holdings Corp., contain fixed charge coverage covenants that would
likely be tripped under a significantly debt-financed acquisition.
While these covenants give Warner more room than the Acquisition
bank facility covenants, Fitch estimates the company generally has
debt capacity of less than $1.5 billion under these covenants.
The Acquisition indenture also has Restricted Payment covenants
that would make it difficult for Warner to complete the
transaction by raising the debt at Holdings since it must be
serviced through dividends by Acquisition.
By Fitch's estimates, proforma for EMI cash flows and existing
debt do not improve debt capacity under any of these covenants.
It should be noted that Fitch has become generally more skeptical
related to covenant compliance under transformational deals, as
several companies across the corporate space have subverted such
protections over the last few years. However, those subversions
typically related to Limitation on Secured Debt language, not
financial covenants.
From an operating standpoint, notwithstanding expected one-time
restructuring costs, Fitch expects recent weakness in Warner's
year-to-date results to be partially offset with third and fourth
quarter releases. Warner has occupied several spots on the
Billboard 200 top 10 over the last month, including Linkin Park's
"Minutes to Midnight," which sold more first week copies than any
other album released this year.
Warner Music Group Corp. (NYSE: WMG) -- http://www.wmg.com/--
is a music company that operates through numerous international
affiliates and licensees in more than 50 countries. Warner
Music maintains international operations in Argentina,
Australia, Brazil, Canada, Croatia, Denmark, France, Germany,
Greece, Hong Kong, Hungary, India, Ireland, Malaysia, Mexico,
Thailand, Philippines and the United Kingdom, among others.
WESTERN REFINING: Completes Giant Industries Acquisition
--------------------------------------------------------
Western Refining, Inc. has completed its acquisition of Giant
Industries, Inc.
With this acquisition, Western is the fourth largest publicly-
traded independent refiner and marketer in the United States, with
a total crude oil throughput capacity of approximately 223,000
barrels per day (bpd).
"We are delighted with the closing of the Giant transaction, which
marks a new chapter in the history of our company," said Western's
President and Chief Executive Officer, Paul Foster. "With Giant,
we have significantly increased our refining capacity in fast
growing, high demand areas and have gained an immediate footprint
in new, complementary businesses. We are now focused on seamlessly
integrating these two great companies and realizing the tremendous
upside potential our combination creates."
Fred Holliger, Giant's Chairman and CEO, offered the following
comment on the merger, "We are pleased that the merger with
Western has closed. As I've said in the past, we firmly believe
that this transaction is in the best interest of our shareholders,
employees and customers. I am confident that the combination of
these two companies will provide greater employee career
opportunities and a stronger, more competitive supplier to all the
markets the combined company will serve."
Under the terms of the agreement, Giant's shareholders will
receive $77.00 per share in cash. In connection with the
completion of the transaction, Giant's common stock ceased to
trade on the NYSE as of the close of trading on May 31, 2007.
About Western Refining
Western Refining, Inc. -- http://www.wnr.com/-- headquartered in
El Paso, Texas, is the fourth largest publicly-traded independent
refiner and marketer in the United States. In addition to a
refinery in El Paso, Western owns and operates two refineries in
the Four Corners region of Northern New Mexico and has an East
Coast presence with its refinery in Yorktown, Virginia. Western's
asset portfolio also includes refined products terminals in
Flagstaff, Arizona and Albuquerque, New Mexico, asphalt terminals
in Phoenix, Tucson, Albuquerque and El Paso, retail service
stations and convenience stores in Arizona, Colorado and New
Mexico, a fleet of crude oil and finished product truck
transports, and three wholesale petroleum products distributors -
Phoenix Fuel Co., Inc. in Arizona, Empire Oil Company in
California and Dial Oil Co. in New Mexico.
* * *
As reported in the Troubled Company Reporter on June 6, 2007,
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Western Refining Inc. and removed the rating from
CreditWatch with negative implications.
WHOLE FOODS: Challenges FTC's Wild Oats Merger Opposition
---------------------------------------------------------
In connection with its tender offer for all of the outstanding
shares of Wild Oats Markets, Inc., the Federal Trade Commission
has advised Whole Foods Market, Inc., that it will file a
complaint in the U.S. District Court for the District of Columbia
seeking to block the proposed acquisition.
The FTC also has advised Whole Foods Market that it will ask the
Court to enter a temporary restraining order that would prohibit
the company from completing its acquisition of the shares of Wild
Oats until the Court has resolved the FTC's request for a
preliminary injunction.
"We are very disappointed by this decision and we intend to
vigorously challenge the FTC in court," John Mackey, Chairman and
Chief Executive Officer of Whole Foods Market, stated. "The FTC
has failed to recognize the robust competition in the supermarket
industry, which has grown more intense as competitors increase
their offerings of natural, organic and fresh products, renovate
their stores and open stores with new banners and formats
resembling Whole Foods Market. Evidently the FTC does not
appreciate the many benefits for consumers of the proposed merger,
including our plan to invest capital in and improve many of the
stores currently owned by Wild Oats."
The FTC's challenge to the proposed merger is based on its
contention that the relevant antitrust product market is limited
to natural and organic food stores and excludes other
supermarkets. The company believes that the FTC's position is
without basis and contrary to its position in past merger reviews,
where its definition of supermarkets has included conventional
supermarkets as well as Whole Foods Market and Wild Oats.
As reported in the Troubled Company Reporter on Feb. 23, 2007, the
company entered into a merger agreement with Wild Oats Markets,
Inc., pursuant to which Whole Foods, through its subsidiary,
commenced a tender offer to purchase all the outstanding shares of
Wild Oats at a purchase price of $18.50 per share in cash. Based
on the FTC's attempt to block the acquisition and the company's
intent to challenge the FTC, the company anticipates announcing
the extension of the expiration date for the tender offer to
purchase outstanding shares of Wild Oats Markets, Inc. in the near
future; currently that expiration date is 5:00 p.m., New York City
time, on Wednesday June 20, 2007.
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.
* Bankrupt Ontario Resident Charged with Bankruptcy Offences
------------------------------------------------------------
The Royal Canadian Mounted Police, Greater Toronto Area Commercial
Crime Section, Toronto North Site, recently charged an individual
with offences under the Criminal Code and the Bankruptcy and
Insolvency Act.
As a result of this RCMP investigation, Jeevarajah Sivasothyrajah
of Markham, Ontario, has been charged with two counts under the
Criminal Code of Canada, namely S.403-Personation, and S.368-
Uttering of Forged Documents.
In addition he has been charged with four counts under Section 198
of the BIA, namely, unlawfully refuse to answer fully and
truthfully questions at an examination, fraudulent dispassion of
property, fraudulently concealing or removing property, and
failing to perform duties as required by a bankrupt. The Criminal
Code/Bankruptcy offences result from the personation of the
bankrupt's deceased wife and the fraudulent disposition of
property. The total amount of the alleged fraud is $406,415.
Mr. Sivasothyrajah's first court appearance is scheduled for
July 6, 2007, at Old City Hall in Toronto.
This investigation resulted from an Investigation Order issued by
the Superintendent of Bankruptcy. "We will continue to
aggressively investigate matters like this which are identified
through a file selection process involving representatives from
the Office of the Superintendent and investigators from the GTA
CCS Bankruptcy Investigations Unit," stated Inspector Brian
Verheul of the RCMP GTA Commercial Crime Section.
* Reed Smith Launches New Bankruptcy Appellate Practice
-------------------------------------------------------
Reed Smith LLP has launched a Third Circuit Bankruptcy Appellate
Practice Team, effective immediately.
"This new group will blend the distinct skills and talents
required to persuade appellate courts with a specialized knowledge
of bankruptcy and restructuring to produce a uniquely high quality
product in bankruptcy appeals," said Kurt Gwynne, a partner in the
Corporate Restructuring & Bankruptcy Group based in the firm's
Wilmington, Delaware office. "We believe our clients will benefit
from this and have a great advantage in pursuing appeals with this
kind of representation."
The United States Court of Appeals for the Third Circuit is home
to two of the nation's most active bankruptcy courts: the
Bankruptcy Court for the District of Delaware, venue for many
large and complex bankruptcy cases, and the Bankruptcy Court for
the Eastern District of Pennsylvania, a hotbed of consumer
litigation. Both produce numerous decisions each year that are
appealed to the Third Circuit, which historically has been a
leading court on bankruptcy issues and whose judges currently
include several former bankruptcy practitioners.
"Reed Smith recognizes that appellate practice is a procedural and
substantive specialty in its own right, and that bankruptcy
appellate practice is even further specialized," said Peter Clark,
firmwide Practice Group Leader for Commercial Bankruptcy &
Restructuring. "The rules governing bankruptcy appeals are
different in important ways from the rules governing standard
civil practice, requiring a combination of both bankruptcy and
appellate practice to have the most effective representation."
"Twenty five years ago our firm was a pioneer in building a
distinct appellate practice group of experienced lawyers who
specialize in civil appeals and writs," said James C. Martin a
partner in the appellate group who has been instrumental in
building Reed Smith's east coast appellate capabilities and who
will co-head with Mr. Gwynne the new Third Circuit Bankruptcy
Appellate Practice Team. "As a result we already have
considerable expertise in managing and winning bankruptcy appeals
within this federal circuit."
The Bankruptcy Appellate Group will provide counsel on cases
"headed for appeal" from the start because of the contentious
nature of the disputes, as well as on cases ripe for appeal
because they involve complex legal or evidentiary issues. The
Group is expected to be in demand because statutes governing
bankruptcy encourage appeals from non-final orders that require
the immediate attention of an appellate court. In addition,
"finality" is a more fluid concept in the bankruptcy courts than
in civil courts and, in some instances, a first level of appeal
can be bypassed and a case brought directly to the Court of
Appeals.
Reed Smith's appellate attorneys have long been active in
organizations and committees involved in both the appellate courts
and bankruptcy courts. Jim Martin recently helped launch the
newly formed Third Circuit Bar Association. He is also co-editor
of the Third Circuit Appellate Practice Manual from PBI for which
Mr. Gwynne and Eric Schaffer, Esq., a Bankruptcy & Restructuring
partner in the firm's Pittsburgh office, co-authored the chapter
on bankruptcy appeals. Other Reed Smith attorneys in the new
Appellate Bankruptcy Team include partners Claudia Springer, Esq.,
Bankruptcy & Restructuring, Mark Melodia, Esq., Financial Services
Litigation, and David Bird, Esq., Appellate.
About Reed Smith
Reed Smith -- http://www.reedsmith.com/-- is one of the 15
largest law firms in the world, with more than 1,500 lawyers in 21
offices throughout the United States, Europe and the Middle East.
Founded in 1877, the firm represents leading international
businesses from Fortune 100 corporations to mid-market and
emerging enterprises. Its attorneys provide litigation services
in multi-jurisdictional matters and other high stake disputes,
deliver regulatory counsel, and execute the full range of
strategic domestic and cross-border transactions. Reed Smith is a
preeminent advisor to industries including financial services,
life sciences, health care, advertising and media, shipping,
international trade and commodities, real estate, manufacturing
and education.
* Wachtell Lipton Tops Ranking in 2006 Vault Guide
--------------------------------------------------
Wachtell Lipton Rosen & Katz ranked first in the region for the
fourth straight year in Vault Inc.'s 2006 edition of its popular
Vault Guide to the Top New York Law Firms.
Vault Inc. has conducted a survey on New York-based law
associates, where the associates were asked to rank the city's law
firms on prestige, and based on the ratings each firm was given,
the top ten New York law firms were:
1. Wachtell, Lipton, Rosen & Katz
2. Cravath, Swaine & Moore
3. Sullivan & Cromwell
4. Davis Polk & Wardwell
5. Simpson Thacher & Bartlett
6. Skadden, Arps, Slate, Meagher & Flom
7. Cleary, Gottlieb, Steen & Hamilton
8. Paul, Weiss, Rifkind, Wharton & Garrison
9. Debevoise & Plimpton
10. Weil, Gotshal & Manges
The New York associates were also asked in the survey, to assess
their own firms on numerous criteria and give a behind-the-scenes
look at law firm life in the Big Apple. In the survey, the
associates related about their hours and their workload, the type
of training they received, what the partners at their firms are
really like, how comfortable their working environment is and the
lowdown on compensation and perks.
This information is featured in the law firm profile for each of
the 72 firms featured in the guide. Each profile also details
firm history, major clients and recent deals, major departments
and practice areas, base salaries, uppers and downers of working
for the firm, and all-important tips on getting hired.
The Vault Guide to the Top New York Law Firms is an updated
insider guide to the region's top law firms.
About Vault Inc.
Vault Inc. -- http://www.vault.com/and http://www.vault.com/--
is a media company focused on careers. Vault offers over 100
nationally distributed books, from the best-selling Vault Guide to
the Top 100 Law Firms to the Vault Guide to Schmoozing. Vault is
celebrated for its online resource, which offers surveys and
"insider" information on more than 4,500 employers, 4,000 colleges
and universities, and hundreds of industries and occupations, well
as the much-praised Electronic WaterCoolerT, the Internet's first-
ever network of message boards for professionals with nearly
2,000,000 searchable posts. Vault was founded in 1996 by Hussam
Hamadeh, Samer Hamadeh, and Mark Oldman.
About Wachtell Lipton Rosen & Katz
Headquartered in New York City, Wachtell, Lipton, Rosen & Katz -
http://www.wlrk.com/-- provides expert service to its clients and
business law firms. The company specializes in matters that
require special attention, extensive experience, sophistication
and the reputation of its partners. The company is called on to
assist clients in their most sensitive and critical matters,
including "bet the company" litigation and government
investigations and proceedings. The company offers clients an
individualized focus on their matters.
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
-------------------------------------------------------------
Recent Chapter 11 cases filed with assets and liabilities below
$1,000,000:
In re Council Grove Florists & Greenhouses
Bankr. D. Kans. Case No. 07-40656
Chapter 11 Petition filed May 22, 2007
See http://bankrupt.com/misc/ksb07-40656.pdf
In re The University Club
Bankr. E.D. Mo. Case No. 07-43185
Chapter 11 Petition filed May 23, 2007
See http://bankrupt.com/misc/moeb07-43185.pdf
In re I.B.M.S.L.J., L.L.C.
Bankr. D. N.J. Case No. 07-17171
Chapter 11 Petition filed May 23, 2007
See http://bankrupt.com/misc/njb07-17171.pdf
In re Atkins Transportation, Inc.
Bankr. E.D. Pa. Case No. 07-20848
Chapter 11 Petition filed May 23, 2007
See http://bankrupt.com/misc/paeb07-20848.pdf
In re Joey's, Inc.
Bankr. S.D. W.Va. Case No. 07-20541
Chapter 11 Petition filed May 23, 2007
See http://bankrupt.com/misc/wvsb07-20541.pdf
In re five-S, Inc.
Bankr. N.D. Ala. Case No. 07-81309
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/alnb07-81309.pdf
In re Gila Sign Centers, Inc.
Bankr. D. Ariz. Case No. 07-00885
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/azb07-00885.pdf
In re Ampol Tool, Inc.
Bankr. D. Conn. Case No. 07-31162
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/ctb07-31162.pdf
In re Cattoira Montessori, Inc.
Bankr. S.D. Fla. Case No. 07-13952
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/flsb07-13952.pdf
In re South Atlanta Child Development Center, Inc.
Bankr. N.D. Ga. Case No. 07-68155
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/ganb07-68155.pdf
In re Advantage Research Services, Inc.
Bankr. E.D. Mich. Case No. 07-50206
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/mieb07-50206.pdf
In re Town Apartments, L.L.C.
Bankr. E.D. Mich. Case No. 07-50240
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/mieb07-50240.pdf
In re Almas HI-FI Stereo, Inc.
Bankr. E.D. Mich. Case No. 07-50247
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/mieb07-50247.pdf
In re Centers of Long Term Care of Tappahannock, Inc.
Bankr. D. Nev. Case No. 07-13028
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/nvb07-13028.pdf
In re G.&L. Salvage and Service, L.L.C.
Bankr. E.D. Tenn. Case No. 07-31690
Chapter 11 Petition filed May 24, 2007
See http://bankrupt.com/misc/tneb07-31690.pdf
In re Premiere Wiring, Inc.
Bankr. D. Ariz. Case No. 07-02428
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/azb07-02428.pdf
In re The Rock Creek International School
Bankr. D. D.C. Case No. 07-00272
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/dcb07-00272.pdf
In re All Media Print Solutions, Inc.
Bankr. N.D. Ill. Case No. 07-09509
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/ilnb07-09509.pdf
In re New El Caney, Inc.
Bankr. D. Mass. Case No. 07-13297
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/mab07-13297.pdf
In re Pappan's Family Restaurants, Inc.
Bankr. W.D. Pa. Case No. 07-23393
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/pawb07-23393.pdf
In re S.T.F.G., Inc.
Bankr. S.D. Tex. Case No. 07-50102
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/txsb07-50102.pdf
In re D.K. Sanderlin, Inc.
Bankr. E.D. Wash. Case No. 07-01740
Chapter 11 Petition filed May 25, 2007
See http://bankrupt.com/misc/waeb07-01740.pdf
In re Sandoree, Inc.
Bankr. N.D. Fla. Case No. 07-40288
Chapter 11 Petition filed May 26, 2007
See http://bankrupt.com/misc/flnb07-40288.pdf
In re Enclosures of Pa., Inc.
Bankr. E.D. Pa. Case No. 07-13053
Chapter 11 Petition filed May 28, 2007
See http://bankrupt.com/misc/paeb07-13053.pdf
In re Louisiana Interests, Inc.
Bankr. N.D. Fla. Case No. 07-30499
Chapter 11 Petition filed May 29, 2007
See http://bankrupt.com/misc/flnb07-30499.pdf
In re Rich Xpress, Inc.
Bankr. M.D. Tenn. Case No. 07-03704
Chapter 11 Petition filed May 29, 2007
See http://bankrupt.com/misc/tnmb07-03704.pdf
In re Fenix Underground, Inc.
Bankr. W.D. Wash. Case No. 07-12433
Chapter 11 Petition filed May 29, 2007
See http://bankrupt.com/misc/wawb07-12433.pdf
In re Brian Wise Trucking, Inc.
Bankr. N.D. Ind. Case No. 07-40278
Chapter 11 Petition filed May 30, 2007
See http://bankrupt.com/misc/innb07-40278.pdf
In re Allison Young
Bankr. E.D. N.Y. Case No. 07-42926
Chapter 11 Petition filed May 30, 2007
See http://bankrupt.com/misc/nyeb07-42926.pdf
In re X-TREME Fitness, Inc.
Bankr. E.D. Ark. Case No. 07-12907
Chapter 11 Petition filed May 31, 2007
See http://bankrupt.com/misc/areb07-12907.pdf
In re Progressive Health Management, Inc.
Bankr. M.D. Fla. Case No. 07-02277
Chapter 11 Petition filed May 31, 2007
See http://bankrupt.com/misc/flmb07-02277.pdf
In re Windwood Heights, Inc.
Bankr. D. N.J. Case No. 07-17533
Chapter 11 Petition filed May 31, 2007
See http://bankrupt.com/misc/njb07-17533.pdf
In re Rojita, Inc.
Bankr. W.D. N.Y. Case No. 07-02199
Chapter 11 Petition filed May 31, 2007
See http://bankrupt.com/misc/nywb07-02199.pdf
In re Better Business Systems, Inc.
Bankr. S.D. W.Va. Case No. 07-20575
Chapter 11 Petition filed May 31, 2007
See http://bankrupt.com/misc/wvsb07-20575.pdf
In re Kirk's Pro-Am, Inc.
Bankr. N.D. Ala. Case No. 07-81376
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/alnb07-81376.pdf
In re St. John Apostolic Cathedral, Inc.
Bankr. S.D. Ala. Case No. 07-11466
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/alsb07-11466.pdf
In re Bryan J. Stone
Bankr. N.D. Ga. Case No. 07-11279
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/ganb07-11279.pdf
In re My DaVinci.com, Inc.
Bankr. N.D. Ill. Case No. 07-09915
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/ilnb07-09915.pdf
In re Johnny Hills Trucking, Inc.
Bankr. M.D. La. Case No. 07-10767
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/lamb07-10767.pdf
In re Furnish Equipment Company, Inc.
Bankr. S.D. Ohio Case No. 07-12590
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/ohsb07-12590.pdf
In re Steel City Collision, Inc.
Bankr. W.D. Pa. Case No. 07-23539
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/pawb07-23539.pdf
In re The Word Is Alive Church
Bankr. D. SC. Case No. 07-02962
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/scb07-02962.pdf
In re Ellen Enterprises, L.L.C.
Bankr. E.D. Tex. Case No. 07-10290
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/txeb07-10290.pdf
In re MartNKim Dining, L.L.C.
Bankr. W.D. Tex. Case No. 07-10981
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/txwb07-10981.pdf
In re A.F.S. Automotive, Inc.
Bankr. W.D. Tex. Case No. 07-10987
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/txwb07-10987.pdf
In re Sherman's Plumbing, Inc.
Bankr. E.D. Va. Case No. 07-11411
Chapter 11 Petition filed June 1, 2007
See http://bankrupt.com/misc/vaeb07-11411.pdf
In re Hilbert Company, L.L.C.
Bankr. N.D. Ohio Case No. 07-14121
Chapter 11 Petition filed June 3, 2007
See http://bankrupt.com/misc/ohnb07-14121.pdf
In re Hanson Rentals, L.L.C.
Bankr. D. Col. Case No. 07-15853
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/cob07-15853.pdf
In re B.A. Design, Inc.
Bankr. N.D. Ga. Case No. 07-68827
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/ganb07-68827.pdf
In re Karlberg, Inc.
Bankr. N.D. Ill. Case No. 07-71356
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/ilnb07-71356.pdf
In re W.A. IV, L.L.C.
Bankr. D. N.J. Case No. 07-17754
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/njb07-17754.pdf
In re E.&F. Warehousing Corp.
Bankr. E.D. N.Y. Case No. 07-72009
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72009.pdf
In re E.&F. Trucking, Inc.
Bankr. E.D. N.Y. Case No. 07-72011
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72011.pdf
In re Empire Freightways, Inc.
Bankr. E.D. N.Y. Case No. 07-72012
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72012.pdf
In re E.F. Logistics Corp.
Bankr. E.D. N.Y. Case No. 07-72013
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72013.pdf
In re Distribution Traffic Services, Inc.
Bankr. E.D. N.Y. Case No. 07-72014
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72014.pdf
In re Distribution Specialists of L.I., Inc.
Bankr. E.D. N.Y. Case No. 07-72015
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/nyeb07-72015.pdf
In re Woo City Franchising, Inc.
Bankr. N.D. Ohio Case No. 07-61615
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/ohnb07-61615.pdf
In re Pirollo Transport Co., Inc.
Bankr. W.D. Pa. Case No. 07-23596
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/pawb07-23596.pdf
In re Kerry Thomas Rhodes
Bankr. N.D. Tex. Case No. 07-42416
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/txnb07-42416.pdf
In re Concorde Forex Group, Inc.
Bankr. E.D. Va. Case No. 07-32057
Chapter 11 Petition filed June 4, 2007
See http://bankrupt.com/misc/vaeb07-32057.pdf
In re Trevor-Martin Corp.
Bankr. M.D. Fla. Case No. 07-04721
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/flmb07-04721.pdf
In re Rosendahl Properties, L.L.C.
Bankr. N.D. Ga. Case No. 07-21089
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/ganb07-21089.pdf
In re The Marble Craftsman, Inc.
Bankr. N.D. Ga. Case No. 07-69001
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/ganb07-69001.pdf
In re Marva Layne
Bankr. D. N.J. Case No. 07-17847
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/njb07-17847.pdf
In re Ariston Enterprises, Inc.
Bankr. D. N.J. Case No. 07-17860
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/njb07-17860.pdf
In re Masjid-Al Islam, Inc.
Bankr. M.D. Tenn. Case No. 07-03883
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/tnmb07-03883.pdf
In re Belle Cachet, Ltd.
Bankr. S.D. Tex. Case No. 07-33853
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/txsb07-33853.pdf
In re Amana Investment, L.L.C.
Bankr. S.D. Tex. Case No. 07-33875
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/txsb07-33875.pdf
In re S.F. Diamond Corp.
Bankr. S.D. Tex. Case No. 07-33884
Chapter 11 Petition filed June 5, 2007
See http://bankrupt.com/misc/txsb07-33884.pdf
*********
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, Sheena Jusay, 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-
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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 ***