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/raid1/www/Hosts/bankrupt/TCR_Public/070709.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, July 9, 2007, Vol. 11, No. 160 Headlines ACANDS INC: Travelers Settles Case for $449 Million ADVANCED MEDICAL: Offers $4.3 Billion for Bausch & Lomb ADVANCED MEDICAL: Moody's Retains Review on Low-B Ratings AIR CANADA: S&P Affirms Long-Term Corp. Credit Rating at B ALERT CELLULAR: Case Summary & 20 Largest Unsecured Creditors AMP'D MOBILE: Gets Court OK to Employ Bayard Firm as Counsel AMP'D MOBILE: Brings In Sherwood Partners as Financial Advisor AMR CORP: Unit Sells 30% ARINC Stake to Carlyle for $194 Million ARCADIUS DEVELOPMENT: Case Summary & Nine Largest Unsec. Creditors ARINC INC: Six Airlines to Sell Over 90% of Shares to Carlyle AZCO MINING: March 31 Balance Sheet Upside-down by $3.6 Million BALLY TOTAL: Discloses Receipt of Alternate Restructuring Proposal BAUSCH & LOMB: Receives Merger Proposal from Advanced Medical BCE INC: Four Banks to Earn $172 Million on Ontario Teacher's Bid CARDTRONICS INC: Plans to Offer $125 Million of Senior Notes CARDTRONICS INC: Acquisition Cues S&P to Affirm B+ Credit Rating CJC DEVELOPMENT: Case Summary & Largest Unsecured Creditor CLAREGOLD TRUST: S&P Rates CDN$2.1MM Class L Certs. at B- CONTINENTAL AIRLINES: Sells ARINC Stake to Carlyle CROWN HOLDINGS: Fitch Affirms B+ Issuer Default Rating DANA CORPORATION: Reaches Agreement with USW and UAW DBI INVESTMENTS: Voluntary Chapter 11 Case Summary DELTA AIR: Inks Signs Pact Selling ARINC Stake to Carlyle EISAMAN REAL: Case Summary & 20 Largest Unsecured Creditors EMERITUS CORP: Nets $305.3 Million from Public Offering FIFTH AVENUE: Case Summary & Seven Largest Unsecured Creditors FORMICA BERMUDA: Fletcher Deal Cues S&P to Withdraw Ratings GENER8XION ENT: Posts $455,779 Net Loss in Quarter Ended March 31 GENERAL GROWTH: Declares $0.45 per Share Dividend due July 31 GENESIS HEALTHCARE: Tender Offers of Senior Notes Expires Today HAIGHTS CROSS: Inks Recapitalization Pact with Investors HAIGHTS CROSS: Okays Enhanced Severance Payments for Key Employees HAIGHTS CROSS: Unit Receives Default Notice from Bear Stearns HEXION SPECIALTY: Huntsman Offer Cues S&P's Negative Watch HILTON HOTELS: Shares Up 37% to $45.71 HILTON HOTELS: Blackstone Agreement Cues Moody's to Review Ratings IMAX CORP: Expects to File Annual Report Before August 1 INSIGHT HEALTH: Noteholders Supports Amended Prepackaged Plan INTERTAPE POLYMER: Shareholders Reject Proposal to Sell Company INTERTAPE POLYMER: Moody's Puts Rating on Review & May Downgrade J&F I FINANCE: S&P Puts Corporate Credit Rating at B JOAN FABRICS: Court Okays Sale of All Assets for $29 Million JR HALE: Case Summary & 20 Largest Unsecured Creditors KIDS INK: Case Summary & 18 Largest Unsecured Creditors MEDICOR LTD: Wants Court Nod on $1.5 Million DIP Financing MILA INC: Deteriorating Market Conditions Cue Bankruptcy Filing MILA INC: Court Gives Nod on Chapter 11 Trustee Appointment MOVIE GALLERY: S&P Junks Credit Rating on Covenant Violation N-45§ FIRST: Moody's Upgraded Class E Certificates to Ba1 NORTHWEST AIRLINES: Sells ARINC Stake to Carlyle NORTHWEST AIRLINES: Distributes Cash and 401(K) Contributions NOVELIS INC: $841,000 of Senior Notes Tendered NYLSTAR INC: Voluntary Chapter 11 Case Summary OPTI CANADA: Completes $750 Million Financing PACIFIC LUMBER: Bank of NY Wants KPMG's Fees Paid by Estate Funds PACIFIC LUMBER: May Employ Baker Botts as Bankruptcy Counsel PENINSULA GAMING: S&P Lifts Corporate Credit Rating to B+ from B RADNET MANAGEMENT: Moody's Lifts Corporate Family Rating to B2 RADNET MANAGEMENT: S&P Rates $445 Million Secured Facility at B RAG SHOPS: Court OKs Rosen Slome as General Bankruptcy Counsel RAG SHOPS: U.S. Trustee Appoints Five-Member Creditors' Committee RF MICRO: Registers Resale of $375 Million Convertible Notes RITCHIE (IRELAND): Court Gives Interim Nod on LeBoeuf as Counsel RITCHIE (IRELAND): Gets Interim Nod on Matheson as Irish Counsel RJ GATORS: Wants to Access Wachovia Cash Collateral ROBBINSDALE APARTMENTS: Case Summary & 3 Largest Unsec. Creditors RUNNING HORSE: La Jolla Wants Relief from Stay Terminated RUNNING HORSE: U.S. Trustee Amended Official Committee Composition SAMSONITE CORP: CVC Capital Buyout Cues S&P's Negative Watch SANITEC INDUSTRIES: Files for Chapter 11 Protection in California SANITEC INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors SEA CONTAINERS: Court Approves $176.5 Million DIP Financing SKILLED HEALTHCARE: IPO Completion Cues S&P to Lift Ratings SOLUTIA INC: Recorded Claims Transfers as of July 2 STATION CASINO: Moody's Assigns Corporate Family Rating at (P)B2 SWIFT & COMPANY: Tender Offer Expiration Extended Until Tomorrow SWIFT & CO: S&P Revises CreditWatch to Positive from Developing TOWER ENTERPRISES: Case Summary & 12 Largest Unsecured Creditors TWEETER HOME: Gets Final Court OK to Use GECC Cash Collateral TWEETER HOME: Asset Sale Procedures Get Court Approval UNITED AIR: Unit Expects $40 Million Gain in Sale of ARINC Stake US AIRWAYS: Inks Agreement Selling ARINC Stake to Carlyle WAMU MORTGAGE: Moody's Assigns Low-B Ratings to Two Certificates WOLF RIVER: Case Summary & 20 Largest Unsecured Creditors * BOND PRICING: For the week of July 2 - July 6, 2007 ********* ACANDS INC: Travelers Settles Case for $449 Million --------------------------------------------------- The Travelers Companies, Inc., disclosed Friday that it has entered into a settlement to resolve fully all current and future asbestos-related coverage claims against Travelers and its subsidiaries relating to ACandS, Inc. Under the settlement agreement, Travelers will contribute $449 million to a trust to be established pursuant to ACandS' plan of reorganization. In connection with the settlement, Travelers expects to cede approximately $84 million to its reinsurers, for a net settlement of $365 million. Travelers will fund the settlement from its existing asbestos reserves and does not anticipate any impact on earnings as a result of the settlement. "ACandS has been one of our most significant and longest-standing asbestos exposures," said Jay S. Fishman, Chairman and Chief Executive Officer. "Eliminating the uncertainty inherent in this litigation makes this a very good outcome for our company and our shareholders." The settlement is subject to a number of contingencies, including final court approval of both the settlement and a plan of reorganization for ACandS. The Wall Street Journal, citing the Associated Press, reports that the settlement comes after a federal court reinstated the Debtor's lawsuit in January 2006. The Debtor claimed that Travelers was liable for 45% of the $2.8 billion it paid to settle asbestos- related claims. About Travelers Based in Saint Paul, Minn., The Travelers Companies, Inc., fka The St. Paul Travelers Companies, Inc., -- http://www.travelers.com/ -- provides a range of commercial and personal property and casualty insurance products and services to businesses, government units, associations and individuals. About ACandS Headquartered in Lancaster, Pennsylvania, ACandS Inc. was an insulation contracting company, primarily engaged in the installation of thermal and mechanical insulation. In later years, the Debtor also performed a significant amount of asbestos abatement and other environmental remediation work. The Company filed for chapter 11 protection on Sept. 16, 2002 (Bankr. Del. Case No. 02-12687). Laura Davis Jones, Esq., Curtis A. Hehn, Esq., James E. O'Neill, Esq., and Michael Paul Migliore, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represent the Debtor in its restructuring efforts. Kathleen Campbell Davis, Esq., Aileen F. Maguire, Esq., Mark T Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. When the Company filed for protection from its creditors, it estimated debts and assets of over $100 million. Chapter 11 Plan Update The Hon. Judith K. Fitzgerald approved the adequacy of the Debtor's Amended Disclosure Statement explaining their proposed Plan of Reorganization on Oct. 3, 2003. On Jan. 26, 2004, Judge Fitzgerald entered Proposed Findings of Fact and Conclusions of Law Re Chapter 11 Plan Confirmation (Doc. 979), recommending that the U.S. District Court deny confirmation of the Debtor's Plan. On Feb. 5, 2004, the Debtor and the Creditors Committee jointly filed with the U.S. District Court for the District of Delaware an objection to the Bankruptcy Court's Proposed Findings. In that filing, the Debtor and the Committee asked the District Court to reject the Bankruptcy Court's Findings and Conclusions and confirm the proposed chapter 11 plan. In a report published in the Troubled Company Reporter, the Debtor has asked the Court to extend is exclusive period to file a chapter 11 plan of reorganization to Oct. 9, 2007. The Debtor said that it was still in negotiations with the Official Committee of Asbestos Personal Injury Claimants and the future claimants' representative to reach a consensus on the terms of a new plan. ADVANCED MEDICAL: Offers $4.3 Billion for Bausch & Lomb ------------------------------------------------------- Advanced Medical Optics Inc. has submitted a proposal to acquire Bausch & Lomb for $75 per share in cash and AMO stock. AMO was designated as a party that B&L can continue to negotiate with despite the end of the "go shop" period. The proposal values Bausch & Lomb at approximately $4.3 billion in equity value. Under the terms of the AMO proposal, each Bausch & Lomb share would be exchanged for $45 in cash and a fixed number of shares of AMO common stock having a value of $30 at the time of signing a definitive agreement. AMO expects the transaction to be marginally dilutive on a cash basis in year one and significantly accretive on a cash basis in year two. "We are pleased that B&L's board has determined that our offer is bona fide and is reasonably likely to result in a superior offer," said AMO chairman, president and CEO Jim Mazzo. "We look forward to working with them to reach a definitive agreement as soon as possible and believe our bid represents a strategically and financially superior proposal to B&L's existing merger agreement." A combination of Advance Medical and Bausch & Lomb would: a) Significantly expand AMO's global scale and scope. With sales in over 100 countries and operations in over 50, B&L's global reach would more than double AMO's direct presence and would greatly enhance its ability to expand market opportunities and margins. b) Broaden and deepen AMO's product portfolio. B&L's strengths are in contact lenses and lens care, eye drops for dry eye, allergies and inflammation, vitamins for ocular health, vitreoretinal surgical products and post-operative prescription products. Combining these with AMO's eye care, cataract and refractive products and technologies would create a broad-based product offering for physicians, which is consistent with AMO's strategy of providing the complete refractive solution. c) Enhance ability to generate efficiencies and innovation. The combined global platform would provide significant opportunities to enhance efficiencies and create productivity improvements. Economies of scale would allow both companies to build on their unique and complementary heritages of product leadership and innovation within ophthalmology through increased investment in R&D. "This is a truly unique opportunity that would enable AMO to accelerate our strategic goal of providing a full range of advanced technologies to address the vision needs of patients of all ages, " Mr. Mazzo said. " I am confident that delivering on this strategy will allow us to generate significant value for shareholders and create new opportunities for our combined employee base. " "The AMO and B&L businesses complement each other and together would provide increased scale, scope and the enhanced ability to generate productivity and efficiency improvements. Through a focus on integrating the best of both businesses, well as the sale of some non-core assets, our goal is to create a stronger, more competitive combined company with a platform for sustained, profitable growth." "AMO's successful acquisition strategy, combined with strong organic growth, has enabled the company to grow its enterprise value from $410 million in 2002 to $3.8 billion today," Mr. Mazzo added. "This strong track record makes us confident that we can deliver significant value through a transaction with B&L. We have already identified sufficient cost-saving opportunities that would make the transaction accretive on a cash basis in year two. We are also confident in our ability to continue to effectively manage our existing businesses and deliver on our current and future financial commitments." "A team of outside advisors will work in conjunction with the management teams to complete a rapid and successful integration. B&L has played an historic role in our industry and we have enormous respect for its proud heritage and skilled employees. Together, I believe we have a unique opportunity to create a company that is capable of changing the face of our industry and will bring benefits to our patients, customers, employees and shareholders." AMO has conducted a thorough review of the potential antitrust issues in connection with the proposed transaction, and it is confident it will be able to address these issues in a timely manner. The cash consideration has been fully committed by Goldman Sachs and will be financed using a combination of bank and public debt. AMO expects that the combined company's leverage at the time of closing will be in line with AMO's pro forma leverage at the time of the closing of the IntraLase transaction. AMO expects to continue its due diligence. There can be no assurance that the proposal will result in any transaction. The company does not anticipate providing additional information about the proposed transaction unless and until it deems further public comment to be required. Goldman Sachs is acting as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP is acting as a legal advisor to AMO About Bausch & Lomb Headquartered in Rochester, New York, Bausch & Lomb Inc. (NYSE: BOL) -- http://www.bausch.com/-- develops, manufactures, and markets eye health products, including contact lenses, contact lens care solutions, and ophthalmic surgical and pharmaceutical products. The company is organized into three geographic segments: the Americas; Europe, Middle East, and Africa; and Asia (including operations in India, Australia, China, Hong Kong, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand). In Latin America, the company has operations in Brazil and Mexico. About Advanced Medical Optics Headquartered in Santa Ana, California, Advanced Medical Optics -- http://www.amo-inc.com/-- (NYSE: EYE) develops, manufactures and markets ophthalmic surgical and contact lens care products. The company has operations in Germany, Japan, Ireland, Puerto Rico and Brazil. ADVANCED MEDICAL: Moody's Retains Review on Low-B Ratings --------------------------------------------------------- Moody's Investors Service maintains Advanced Medical Optics, Inc. ratings on review for possible downgrade following AMO's announcement of its offer for Bausch & Lomb, Inc. for $75 per common share in a combination of $45 in cash and $30 in AMO common stock. The proposed transaction is valued at approximately $5 billion, including approximately $830 million of debt. AMO's offer is subject to termination of BOL's previously announced merger agreement with affiliates of Warburg Pincus LLC and the execution of a definitive merger agreement with BOL The AMO offer is conditioned upon, among other things: (1) approval from both AMO and BOL shareholders; (2) regulatory approvals and (3) certain additional due diligence by AMO. Additionally, the AMO offer contains a $130 million termination fee in the event the transaction does not close due to the failure to obtain requisite financing or antitrust clearance. Moody's understands that the BOL Board of Directors, following the recommendation of a Special Committee, favors the AMO offer. Further, Moody's understands that the BOL Special Committee and its advisors will engage in further discussions with AMO regarding its offer. "The review for possible downgrade is based, in part, on the belief that if the business combination is completed, the pro forma leverage of the combined entity would be considerably higher than AMO's leverage on a standalone basis," said Sidney Matti, Analyst. Given the expectation that the merger will be financed with a significant amount of debt, a multi-notch downgrade could occur, although it should be noted that AMO's financing plan has not yet been made known. Additionally, the review will focus on the financial impact of the recall of the company's Complete MoisturePlus contact lens solution product. AMO's ratings were originally placed on review for possible downgrade on May 29, 2007 following AMO's announcement that it voluntarily withdrew its Complete MoisturePlus contact lens solution based on information received from the U.S. Centers for Disease Control and Prevention regarding Acanthamoeba keratitis infections from the Acanthamoeba microorganism. These ratings remain on review for possible downgrade: -- B1 Corporate Family Rating; -- B1 Probability of Default Rating; -- Ba1 (LGD2/14%) rating on $300 million senior secured revolver due 2013; -- Ba1 (LGD2/14%) rating on $450 million senior secured term loan B due 2014; -- B1 (LGD4/50%) rating on $250 million senior subordinated notes due 2017; and -- B3 (LGD5/81%) rating on $251 million convertible senior subordinated notes due 2024. Bausch & Lomb, Inc., headquartered in Rochester, New York, is a leading worldwide provider of eye care products, including contact lens, lens care, ophthalmic pharmaceuticals and surgical products. For the twelve months ended March 31, 2007, BOL reported approximately $2.3 billion in revenues. Currently, BOL's senior unsecured debt rating is Ba1 and is under review for possible downgrade. Advanced Medical Optics, Inc., headquartered in Santa Ana, California, is a global leader in the development, manufacturing and marketing of ophthalmic surgical and contact lens care products. For the twelve months ended March 31, 2007, AMO reported approximately $1 billion in revenues. AIR CANADA: S&P Affirms Long-Term Corp. Credit Rating at B ---------------------------------------------------------- Standard & Poor's Ratings Services affirmed the 'B' long-term corporate credit rating on Montreal, Quebec-based national carrier Air Canada. The outlook is stable. "The rating reflects Air Canada's continued exposure to the cyclical and competitive airline industry, weak free cash flow generation, and high leverage," said Standard & Poor's credit analyst Greg Pau. "These factors outweigh the company's strong position in the domestic market, innovative marketing and cost- control efforts, and strong travel demand in the past two years," Mr. Pau added. Air Canada operates a fleet of 199 aircraft (334 including Jazz's fleet) and generated revenue of CDN $10.1 billion in 2006. Air Canada's key strength is its dominant position in the domestic market. Through its extensive route network, reputable loyalty program, transparent tiered ticket pricing, and marketing efforts to frequent business travelers, the company maintains a defendable advantage over WestJet Airlines Ltd., and captures 60% of the market. These efforts have also allowed the company to increase direct Web-based purchases and reduce commission costs. In the past two years, Air Canada has also benefited from the financial distress of the U.S. airlines, posting strong growth and capturing a 38% share in the U.S. transborder market. Competition could intensify once the U.S. airlines face less financial pressure. Air Canada faces a difficult industry environment characterized by intense fare competition, high and volatile fuel prices, highly geared participants, and an ongoing security threat from terrorism. Despite two consecutive years of strong passenger demand, emerging low-cost airlines are likely to constrain pricing power and prevent significant revenue improvement. The stable outlook on Air Canada reflects its defendable market position and the positive effect of its cost-control and marketing efforts, offset by a challenging operating environment. The potential for a rating or outlook revision is constrained by Air Canada's weak financial risk profile, hefty capital expenditure program, and post-retirement deficit. The rating could only be raised if there is significant deleveraging through equity injection. Conversely, the rating could be lowered if the company's liquidity significantly weakens and cash flow from its expanded fleet capacity falls materially short of expectation. ALERT CELLULAR: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Alert Cellular, L.C., aka Alert Cellular, L.L.C. aka Get Mobile dba Alert Cellular dba The Mobile Store 4180 Via Real, Suite E Carpinteria, CA 93013 Bankruptcy Case No.: 07-10918 Type of business: The Debtor is an authorized wireless retailer for Verizon and T-Mobile. See http://alertcellular.com Chapter 11 Petition Date: July 3, 2007 Court: Central District Of California (Santa Barbara) Debtor's Counsel: Malhar S. Pagay, Esq. Pachulski, Stang, Ziehl, Young & Jones 10100 Santa Monica Boulevard, 11th Floor Los Angeles, CA 90067 Tel: (310) 277-6910 Fax: (310) 201-0760 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ J.P. Morgan Chase bank loan $2,756,684 80 West Broadway, Suite 200 Salt Lake City, UT 84101 Reliance Communications trade debt $113,678 20 A Commerce Way Totowa, NJ 7512 Global Warranty Group trade debt $89,195 500 Middle Country Road St. James, NV 11780 Brightstar trade debt $78,797 Cellular Max, Inc. trade debt $55,228 Mayer Hoffman McCann- trade debt $53,620 C.B.I.Z. Technocel trade debt $44,600 Wireless Xcessories trade debt $40,965 A.D.V.O. trade debt $38,639 Dewerd Capital Partners trade debt $36,000 Aerovoice trade debt $35,481 Staples trade debt $35,272 Federal Express trade debt $33,758 Wireless One trade debt $32,923 U.P.S. trade debt $25,407 Affordablecom trade debt $21,979 Fedex Kinko's trade debt $19,458 Palmer Promotional trade debt $18,952 Products Business Systems Solutions trade debt $16,856 Precision Sign trade debt $16,732 AMP'D MOBILE: Gets Court OK to Employ Bayard Firm as Counsel ------------------------------------------------------------ Amp'd Mobile Inc. obtained authority from the U.S. Bankruptcy Court for the District of Delaware to employ The Bayard Firm as its bankruptcy counsel, nunc pro tunc to June 1, 2007. Bayard is expected to provide bankruptcy advice, including assistance in the preparation of the requisite petitions, pleadings, exhibits, lists and schedules in connection with the Debtor's Chapter 11 case. Specifically, Bayard will: (a) take all necessary actions to protect and preserve the Debtor's estate, prosecute actions on the Debtor's behalf, defend any actions commenced against the Debtor, negotiate disputes in which the Debtor is involved and prepare objections to claims filed against the Debtor's estate; (b) provide legal advice with respect to the Debtor's powers and duties as debtor-in-possession in the continued operation of its business and management of its properties; (c) negotiate, prepare and pursue confirmation of a plan of reorganization and approval of a disclosure statement; (d) prepare, on the Debtor's behalf, necessary motions, applications, answers, orders, reports and other legal papers in connection with the administration of the Debtor's estate; (e) appear in Court and protect the Debtor's interest before the Court; and (f) assist with any disposition of the Debtor's assets, by sale or otherwise. The Debtor will pay Bayard according to the firm's customary hourly rates: Professional Hourly Rates ------------ ------------ Directors $440 to $675 Associates and Counsel $205 to $415 Paralegals & Case Management Assistants $180 to $85 The Debtor will also reimburse Bayard for any necessary out-of- pocket expenses the firm incurs while providing services for the Debtor. Steven M. Yoder, Esq., a director and shareholder of Bayard, assures the Court that his firm does not represent any interest adverse to the Debtor and its estate, and is a "disinterested person" as the term is defined under Section 101(14) of the Bankruptcy Code. Mr. Yoder discloses that Bayard may have been or may be currently representing these parties, among others, in matters unrelated to the Debtor's case: * ADT, * AT&T, * BAX Global, * CDW, * Circuit City, * Let's Talk, * Major League Baseball, * Motorola, * Sony BMG Music, * Sprint PCS, * Verizon Wireless, and * Warner Bros. Mr. Yoder also discloses that on June 1, 2007, the Debtor sent Bayard a $35,000 retainer through wire transfer. About $11,436 of the Retainer was drawn to pay for Bayard's prepetition fees and expenses. A balance of $23,563, which will be applied to future fees and expenses, remains in the Debtor's client trust account. 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. The Debtor's exclusive period to file a plan expires on Sept. 29, 2007. (Amp'd Mobile Bankruptcy News, Issue No. 7; Bankruptcy Creditors'Service Inc. http://bankrupt.com/newsstand/ or 215/945-7000) AMP'D MOBILE: Brings In Sherwood Partners as Financial Advisor -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave Amp'd Mobile Inc. authority to employ Sherwood Partners LLC as its financial advisor, nunc pro tunc to June 1, 2007. Sherwood is expected to: (a) assist the Debtor in preparing and filling financial documents or reports; (b) assist the Debtor with determining whether or not its business is viable on a going forward basis; (c) assess the Debtor's postpetition finances, including its revenues and its disbursements; (d) assist the Debtor in preparing cash flows, which accompany its cash collateral motion as well as those in support of a DIP financing or plan of reorganization; (e) advise the Debtor with regard to the financial viability of any reorganization plan; (f) review the performance of the Debtor's management; (g) participate in discussions with Debtor's counsel, as necessary; (h) meet with the Debtor's representatives and representatives of important constituents including the Debtor's secured creditor, Kings Road Investment, Ltd., its financial advisors and any other significant creditors or parties as necessary; (i) analyze and advise the Debtor regarding proposed sales of any assets; and (j) assist the Debtor with regard to litigation and contested matters that arise in the bankruptcy case including assistance to the Debtor on matters that the Debtor commences. The Debtor intends to employ five Sherwood professionals and pay those professionals in accordance with the firm's hourly rates: Michael A. Maidy $500 Andrew De Camara $400 Neal Gluckman $400 Edward Traum $400 Tim Cox $300 The Debtor may hire more Sherwood professionals as deemed necessary. The Debtor has agreed to indemnify Sherwood under certain circumstances. Mr. Maidy, president of Sherwood, assures the Court that his firm does not represent any interest adverse to the Debtor and its estate, and is a ?disinterested person? as the term is defined under Section 101(14) of the Bankruptcy Code. 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. The Debtor's exclusive period to file a plan expires on Sept. 29, 2007. (Amp'd Mobile Bankruptcy News, Issue No. 7; Bankruptcy Creditors'Service Inc. http://bankrupt.com/newsstand/ or 215/945-7000) AMR CORP: Unit Sells 30% ARINC Stake to Carlyle for $194 Million ---------------------------------------------------------------- AMR Corporation's wholly-owned subsidiary, American Airlines, Inc., along with five other airlines, entered into a Stock Purchase Agreement with ARINC Inc., and Radio Acquisition Corp., an affiliate of the Carlyle Group. Under the agreement, the airlines, holding over 90% of ARINC shares, will sell their respective stakes to Radio Acquisition. The sale is expected to close before Oct. 31, 2007. According to the company, it expects to receive proceeds of approximately $194 million and record a $140 million gain from the sale. According to the Wall Street Journal, AMR has a 30% stake in ARINC. WSJ adds that along with American Airlines, the other airlines in the deal are: * UAL Corp.'s United Air Lines Inc., * Continental Airlines Inc., * Delta Air Lines Inc., * Northwest Airlines Corp. and * US Airways Group Inc. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. -- http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. * * * As reported in the Troubled Company Reporter on May 25, 2007, Standard & Poor's Ratings Services assigned its 'CCC+' rating to American Airlines Inc.'s (B/Positive/--) $125 million Dallas/Fort Worth International Airport special facility revenue refunding bonds, series 2007, due 2030. The bonds are guaranteed by American's parent, AMR Corp. (B/Positive/B-2), and are secured by payments made by American to the airport authority. Proceeds are being used to refund the outstanding revenue bonds, series 1992 (rated 'CCC+'), whose rating is withdrawn. ARCADIUS DEVELOPMENT: Case Summary & Nine Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: Arcadius Development, L.L.C. 14820 Ballantyne Country Club Drive Charlotte, NC 28277 Bankruptcy Case No.: 07-01462 Type of business: The Debtor develops real estate. Chapter 11 Petition Date: July 5, 2007 Court: Eastern District of North Carolina (Raleigh) Debtor's Counsel: Trawick H. Stubbs, Jr. Stubbs & Perdue, P.A. P.O. Drawer 1654 New Bern, NC 28563 Tel: (252) 633-2700 Fax: (252) 633-9600 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's Nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Arcadius Investors, L.L.C. $1,800,000 Attention: Managing Agent 100 North Tryon Street, Suite 4700 Charlotte, NC 28202 Egis Southeast Realty Cap $1,000,000 Attention: Managing Agent 14820 Ballntyn Country CI Charlotte, NC 28277 LS3P Associates, Ltd. $746,825 Attention: Managing Agent 205 1/2 King Street Charleston, SC 29401 Buric Construction Cons. $173,289 Mactec Engineering & $82,015 Construction Bovis Lend Lease, Inc. $75,737 Village Realty $56,000 Ward & Smith, P.A. $8,000 McColl & Associates, Inc. $3,000 ARINC INC: Six Airlines to Sell Over 90% of Shares to Carlyle ------------------------------------------------------------- Six U.S. airlines, holding more than 90% of Arinc Inc., have agreed to sell their respective stakes to an affiliates of The Carlyle Group, The Wall Street Journal reported Friday. The airlines include: * AMR Corp.'s American Airlines, * UAL Corp.'s United Airlines Inc., * Continental Airlines Inc., * Delta Air Lines Inc., * Northwest Airlines Corp. and * US Airways Group Inc. Under the agreement, which is expected to close before Oct. 31, 2007, the airlines will sell their stake to Radio Acquisition Corp., a Carlyle affiliate. WSJ relates that the deal is expected to generate as much as $1 billion. The report adds that financial details of the agreement wasn't disclosed, citing an Arinc spokeswoman. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC Inc. ARINC Inc. -- http://www.arinc.com/-- provides communications and IT services to the global aviation industry and the U.S. military and other government agencies. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. * * * As reported in the Troubled Company Reporter on July 6, 2007, Standard & Poor's Ratings Services revised its CreditWatch implications on the 'BB' corporate credit rating and other ratings on ARINC Inc. to negative from developing. According to S&P, "[t]he revision follows the announcement that ARINC will be sold to the Carlyle Group." AZCO MINING: March 31 Balance Sheet Upside-down by $3.6 Million --------------------------------------------------------------- Azco Mining Inc.'s consolidated balance sheet at March 31, 2007, showed $4.4 million in total assets and $8 million in total liabilities, resulting in a $3.6 million total stockholders' deficit. The company's consolidated balance sheet at March 31, 2007, also showed strained liquidity with $1.2 million in total current assets available to pay $8 million in total current liabilities. The company reported a net loss of $737,372 on zero sales for the third quarter ended March 31, 2007, compared with a net loss of $489,519 on sales of $1,205 for the same period ended March 31, 2006. The decrease in sales is a result of cessation of sales of mica- filled plastic pellets. The increase in net loss is mainly a result of the increase in other expenses. Other expenses for the quarter ended March 31, 2007, were $270,897 as compared to other income of $275,888 for the comparable quarter ended March 31, 2006. The increase in other expenses is mainly attributable to the increase in accretion of discounts on notes payable and lease liability aggregating $1.0 million and the increase in interest expense of $197,623, mainly consisting of interest recognized on debt conversion, and was offset in the current period by an increased gain on derivative instruments liability of $685,269 which arose in connection with a financing lease and convertible debentures. 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?2170 Going Concern Doubt As reported in the Troubled Company Reporter on Feb. 22, 2007, Stark Winter Schenkein & Co. LLP, in Denver, Colorado, expressed substantial doubt about Azco Mining Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended June 30, 2006. The auditing firm cited that the company has suffered recurring losses from operations, has no current source of operating revenues, and needs to secure financing. About Azco Mining Azco Mining Inc. (Other OTC: AZMN.PK) -- http://www.azco.com/-- is a mining and exploration company. The company owns the Summit gold-silver property and a mill site and processing equipment in southwestern New Mexico, mineral lease rights to the Ortiz gold property in north-central New Mexico, a high-quality mica mine and processing facility near Phoenix, and a large resource of micaceous iron oxide in La Paz County, Arizona. BALLY TOTAL: Discloses Receipt of Alternate Restructuring Proposal ------------------------------------------------------------------ Bally Total Fitness disclosed Friday that its Board of Directors has received a letter from current shareholders Liberation Investments, L.P., Liberation Investments, Ltd., Harbinger Capital Partners Master Fund I, Ltd. and Harbinger Capital Partners Special Situations Fund L.P., which proposes an alternate chapter 11 plan of reorganization for the company. The company is engaging in discussions with these shareholders and, subject to the execution of confidentiality agreements, will provide due diligence access to these shareholders for the purposes of their proposal being further refined and proposed definitive documentation being provided to the Board for review and consideration. The shareholders have agreed to complete their due diligence by July 20, 2007, and the company has asked that proposed definitive documentation be negotiated by that date. There are no assurances that any agreement will be reached with the shareholders. Solicitation for Prepackaged Plan As previously reported, the company is currently soliciting consents to its prepackaged plan of reorganization, as to which holders of 63% of its Senior Notes and more than 80% of its Senior Subordinated Notes have signed a Restructuring Support Agreement. The expiration of the company's solicitation of consents for its proposed plan of reorganization is July 27, 2007. The company will continue soliciting consents from noteholders while the Board engages in discussions with these shareholders. About Bally Total Based in Chicago, Illinois, Bally Total Fitness Holding Corp. (NYSE: BFT)(OTC BB: BFTH) -- http://www.ballyfitness.com/-- is a commercial operator of fitness centers in the U.S., with over 375 facilities located in 26 states, Mexico, Canada, Korea, China and the Caribbean under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports Clubs of Canada (R) brands. Bally offers a unique platform for distribution of a wide range of products and services targeted to active, fitness-conscious adult consumers. BAUSCH & LOMB: Receives Merger Proposal from Advanced Medical ------------------------------------------------------------- Bausch & Lomb has received from Advanced Medical Optics a proposal to acquire 100% of the outstanding shares of Bausch & Lomb in a merger in which Bausch & Lomb's shareholders would receive, per share of Bausch & Lomb stock, $45 in cash and $30 in AMO stock, valued based on the average closing price of the AMO common stock for five trading days prior to the date on which a definitive agreement is signed. The AMO Proposal is subject to termination of Bausch & Lomb's merger agreement with affiliates of Warburg Pincus LLC and the execution of a definitive merger agreement with AMO. The AMO Proposal's terms include that AMO will have up to 12 months to close the transaction and that interest would be paid in cash with respect to the purchase price by AMO at the rate of 7.2% per annum beginning six months after a definitive merger agreement is executed. The proposal is not subject to a financing condition. AMO has submitted a financing commitment letter in connection with the proposal. The AMO Proposal is conditioned upon: (1) approval by AMO's shareholders and Bausch & Lomb's shareholders; (2) regulatory approvals; and (3) certain additional due diligence by AMO. The AMO Proposal includes: (1) a proposed $130 million reverse termination fee payable by AMO to Bausch & Lomb in the event the transaction does not close due to the failure to obtain requisite financing or antitrust clearance; and (2) proposed reimbursement by AMO of Bausch & Lomb's expenses up to $35 million if AMO fails to obtain the approval of its shareholders. The AMO Proposal provides for: (1) a proposed $130 million termination fee payable under certain circumstances by Bausch & Lomb to AMO in the event of termination of an agreement with AMO in connection with the exercise by the Bausch & Lomb Board of Directors of its fiduciary duties; and (2) a proposed reimbursement of AMO's expenses up to $35 million under the same circumstances in which such expenses are reimbursable under the Warburg Pincus Agreement. The Bausch & Lomb board of directors, after the recommendation of a Special Committee composed entirely of independent directors, has determined that the AMO Proposal is bona fide and is reasonably likely to result in a superior proposal, as defined in the Warburg Pincus Agreement. AMO has therefore been designated an "excluded party" as defined in the Warburg Pincus Agreement. By designating AMO an excluded party, Bausch & Lomb is permitted, subject to certain conditions, to continue negotiating with AMO with respect to the AMO Proposal despite the end of the "go shop" period. The Special Committee and its advisors intend to engage in further discussions with AMO regarding the AMO Proposal. Bausch & Lomb cautioned that the AMO Proposal is subject to a number of contingencies which the Special Committee is continuing to evaluate, including the requirement of approval by AMO's shareholders as well as antitrust clearances, and that there could be no assurance that the Special Committee would ultimately find the proposal to be a superior proposal under the merger agreement. Bausch & Lomb cautioned that the discussions with AMO may be terminated at any time and that there can be no assurances as to whether the AMO Proposal will ultimately result in a transaction with Bausch & Lomb. AMO is the only "excluded party" designated by the Special Committee. Warburg Pincus Agreement As disclosed on May 16, 2007, Bausch & Lomb entered into the Warburg Pincus Agreement, pursuant to which Warburg Pincus agreed to acquire 100% of the outstanding shares of Bausch & Lomb for $65 per share in cash. The Warburg Pincus Agreement may be terminated under certain circumstances, including if Bausch & Lomb receives and enters into a definitive agreement with respect to a superior proposal and provides advance notice to Warburg Pincus. If the Warburg Pincus Agreement is terminated under these circumstances with respect to an excluded party such as AMO, Warburg Pincus will be entitled to a $40 million payment from Bausch & Lomb. Pending further discussions with AMO, Bausch & Lomb's board, after the recommendation of the Special Committee of the board, has not changed, and has reaffirmed, its recommendation of Bausch & Lomb's pending merger with affiliates of Warburg Pincus pursuant to the Warburg Pincus Agreement. About Advanced Medical Optics Headquartered in Santa Ana, California, Advanced Medical Optics -- http://www.amo-inc.com/-- (NYSE: EYE) develops, manufactures and markets ophthalmic surgical and contact lens care products. The company has operations in Germany, Japan, Ireland, Puerto Rico and Brazil. About Bausch & Lomb Headquartered in Rochester, New York, Bausch & Lomb Inc. (NYSE: BOL) -- http://www.bausch.com/-- develops, manufactures, and markets eye health products, including contact lenses, contact lens care solutions, and ophthalmic surgical and pharmaceutical products. The company is organized into three geographic segments: the Americas; Europe, Middle East, and Africa; and Asia (including operations in India, Australia, China, Hong Kong, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand). In Latin America, the company has operations in Brazil and Mexico. * * * As reported in the Troubled Company Reporter on May 28, 2007, the Warburg Pincus Deal prompted Standard & Poor's Ratings Services to lower its ratings on Bausch & Lomb and placed them on CreditWatch with negative implications. Among others, S&P lowered the company's corporate credit rating to 'BB+' from 'BBB'. Additionally, Moody's Investors Service said it will continue its review of Bausch & Lomb's ratings for possible downgrade, including the company's Ba1 Corporate Family rating. Furthermore, Fitch maintained its Negative Rating Watch on Bausch & Lomb emphasizing that the transaction would significantly increase leverage and likely result in a multiple-notch downgrade. Fitch also warns that the transaction would result in an Issuer Default Rating of no higher than 'BB-'. BCE INC: Four Banks to Earn $172 Million on Ontario Teacher's Bid ----------------------------------------------------------------- Four banks could split as much as CDN$181 million, or approximately $172 million, as a result of their assistance on the Ontario Teacher's Pension Plan's bid for BCE Inc., Sean B. Pasternak of Bloomberg reports. As reported Troubled Company Reporter July 2, 2007, the company has entered into a definitive agreement to be acquired by an investor group led by Teachers Private Capital, the private investment arm of the Ontario Teachers Pension Plan, Providence Equity Partners Inc. and Madison Dearborn Partners, LLC. The all-cash transaction is valued at CDN$51.7 billion ($48.5 billion), including CDN$16.9 billion ($15.9 billion) of debt, preferred equity and minority interests. BCE's Board of Directors unanimously recommended that shareholders vote to accept the offer. According to Bloomberg, the banks include Citigroup Inc., Toronto- Dominion Bank, Deutsche Bank AG, and Royal Bank of Scotland Group Plc. Deutsche Bank stands to earn 0.3% of the total price while Royal Bank will get 0.35%, the report adds, citing two people involved in the transaction. Bloomberg relates that Bill Fox, BCE spokesman, declined to give comments. About BCE BCE Inc. (TSX/NYSE: BCE) -- http://www.bce.ca/-- is Canada's largest communications company, providing the most comprehensive and innovative 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 (or value-added services) and direct-to-home satellite and VDSL television services. Other BCE holdings include Telesat Canada and an interest in CTVglobemedia. * * * As reported in the Troubled Company Reporter on July 5, 2007, Fitch Ratings downgraded BCE's Issuer Default Rating and Senior unsecured debt rating to BB- from BBB+. The rating action follows BCE's acceptance of a CDN$42.75 per share in cash buy-out offer from Teachers Private Capital, a private investment affiliate of the Ontario Teachers Pension Plan, Providence Equity Partners Inc., and Madison Dearborn Partners, LLC. CARDTRONICS INC: Plans to Offer $125 Million of Senior Notes ------------------------------------------------------------ Cardtronics, Inc., plans to offer $125.0 million aggregate principal amount of 9-1/4% Senior Subordinated Notes due 2013, subject to market and other customary conditions. The notes are an additional issuance of Cardtronics' 9-1/4% Senior Subordinated Notes due 2013, $200.0 million of which were originally issued in August 2005. The company intends to use the net proceeds from this offering, together with available cash and borrowings under its revolving credit facility, to fund its previously announced acquisition of substantially all of the assets of the financial services business of 7-Eleven, Inc., which is expected to close early in the third quarter of 2007. The notes will be offered in the United States to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended and outside the United States pursuant to Regulation S under the Securities Act. The notes have not been registered under the Securities Act and may not be offered or sold in the United States without registration or an applicable exemption from the registration requirements. About Cardtronics Headquartered in Houston, Texas, Cardtronics Inc. -- http://www.cardtronics.com/-- is a non-bank owner/operator of ATMs with more than 25,750 locations. The company operates in every major U.S. market, at approximately 1,700 locations throughout the U.K., and at over 700 locations in Mexico. CARDTRONICS INC: Acquisition Cues S&P to Affirm B+ Credit Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its B+/Stable/-- corporate credit rating on Houston, Texas-based Cardtronics Inc., after the company's announced acquisition of the U.S. ATM operations of 7-Eleven, Inc. The outlook remains stable. "The ratings on Cardtronics reflect its high leverage and aggressive capital spending in a mature and consolidating industry," said Standard & Poor's credit analyst David Tsui. These factors partly are offset by Cardtronics' leading position in the U.S. as an independent ATM provider and recurring revenue streams. Pro forma for the acquisition of 5,500 ATMs from 7-Eleven, Inc., Cardtronics owns about 60% of its network of approximately 31,000 ATMs and provides services for the balance. Cardtronics' ATMs are located in nonbanking sites, typically located in convenience stores, grocery stores, drugstores and retailers. Contracts with merchants are on average five to seven years, providing stable and recurring revenue streams. The company's top 15 customers account for approximately 40% of revenues. Cardtronics has grown rapidly since 2001, tripling the number of ATMs in its network, primarily through acquisitions. However, the U.S. ATM industry is mature, and characterized by sharp competition for high traffic, high volume sites. Organic growth opportunities, including the increased revenues associated with bank and network branding initiatives and a growing presence in the U.K. and Mexico provided some relief. CJC DEVELOPMENT: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: C.J.C. Development, L.L.C. 8266 South Fletcher Run Circle, Suite 101 Cordova, TN 38016 Bankruptcy Case No.: 07-26162 Chapter 11 Petition Date: July 5, 2007 Court: Western District of Tennessee (Memphis) Judge: Jennie D. Latta Debtor's Counsel: Russell W. Savory, Esq. 88 Union Avenue, 14th Floor Memphis, TN 38103 Tel: (901) 523-1110 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Gurbachan Grewal $516,000 17001 Foothill Boulevard Sylmar, CA 91342 CLAREGOLD TRUST: S&P Rates CDN$2.1MM Class L Certs. at B- --------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to ClareGold Trust's CDN $475.4 million commercial mortgage pass-through certificates series 2007-2. The preliminary ratings are based on information as of July 5, 2007. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings assigned to ClareGold Trust's CDN $475.4 million commercial mortgage pass-through certificates series 2007-2 reflect the credit support provided by the subordinate classes of certificates, the liquidity provided by the servicer and backup servicer, the economics of the underlying mortgage loans, and the geographic and property-type diversity of the underlying pool of loans. Standard & Poor's has determined that, on a weighted-average basis, the loan pool has a debt service coverage ratio of 1.42x, a beginning loan-to-value ratio of 90.9%, and an ending LTV of 73.3%. Preliminary Ratings Assigned ClareGold Trust Class Rating Amount ----- ------ ------ A-1 AAA CDN$248,580,000 A-2 AAA CDN$177,835,000 X AAA N/A B AA CDN$9,745,000 C A CDN$8,913,000 D BBB CDN$11,884,000 E BBB- CDN$2,377,000 F BB+ CDN$4,160,000 G BB CDN$1,783,000 H BB- CDN$1,188,000 J B+ CDN$1,188,000 K B CDN$594,000 L B- CDN$2,139,000 M N.R. CDN$4,992,737 N.R. -- Not rated. N/A -- Not applicable. CONTINENTAL AIRLINES: Sells ARINC Stake to Carlyle -------------------------------------------------- Continental Airlines Inc., along with five other airlines, entered into a Stock Purchase Agreement selling their stake in ARINC Inc. to Radio Acquisition Corp., an affiliate of the Carlyle Group, the Wall Street Journal reports. The five other airlines are: * AMR Corp.'s American Airlines Inc., * UAL Corp.'s United Air Lines Inc., * Delta Air Lines Inc., * Northwest Airlines Corp. and * US Airways Group Inc. According to the report, the airlines, who holds over 90% of ARINC shares, expects to gain around $1 billion. The sale is expected to close before Oct. 31, 2007. AMR said that it expects to receive $194 million from the sale while UAL said it expect to get $125 million. WSJ relates that the airlines declined to comment further on the deal. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. - http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/ -- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 3,100 daily departures throughout the Americas, Europe and Asia, serving 144 domestic and 138 international destinations. More than 400 additional points are served via SkyTeam alliance airlines. With more than 44,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with Continental Express, carries about 67 million passengers per year. * * * As of March 2007, Continental Airlines carries Moody's Investors Service's B2 corporate family rating. The company also carries Moody's B3 senior unsecured rating and Caa1 preffered stock rating. CROWN HOLDINGS: Fitch Affirms B+ Issuer Default Rating ------------------------------------------------------ Fitch Ratings has affirmed the ratings for Crown Holdings, Inc., and its subsidiaries Crown Cork & Seal Company, Inc., Crown Americas, LLC, and Crown European Holdings, SA as: Crown: -- Issuer Default Rating 'B+'. CCS: -- IDR 'B+'; -- Senior unsecured notes 'B/Recovery Rating of RR5'. CA: -- IDR 'B+'; -- Senior secured dollar term facility 'BB+/RR1'; -- Senior secured dollar revolving facility 'BB+/RR1'; -- Senior unsecured notes 'B+/RR4'; CEH: -- IDR 'B+'; -- Senior secured euro term facility 'BB+/RR1'; -- Senior secured euro revolving facility 'BB+/RR1'; -- Senior secured euro 1st priority notes 'BB+/RR1'; Approximately $3.5 billion of debt is covered by the ratings. The Rating Outlook is Stable. The ratings reflect Crown's leading market share across its product categories, balanced revenue mix, geographic diversification, good liquidity, modest near-term debt maturities, volume growth in emerging markets, and focus on debt reduction. Rating concerns include high leverage, escalating raw materials and energy costs, intense competition in mature markets, increasing cash deployment towards shareholders, and to a lesser extent, asbestos liability. The Stable Outlook reflects the relatively steady demand in Crown's key end-markets, consistent operating performance and solid cash generation. The company's internationally balanced asset portfolio is also a key factor lending stability to the Outlook. Crown has been challenged with substantially higher raw materials costs over the past few years but has successfully passed higher costs to its customer base in most cases. Higher energy costs are an additional pressure on margins. Despite these challenges, Crown has maintained stable profitability over the past several quarters, and has repaid a meaningful portion of debt over the past few years. Free cash generation of $164 million in 2006 was below Fitch's expectation. Management has indicated that working capital was the primary factor leading to lower than expected free cash flow. In late 2006, Crown added an additional $200 million of term debt under its existing credit facility, using the proceeds to pay down outstanding revolver balances and improve liquidity. Fitch has updated its recovery analysis to account for the additional secured debt outstanding. Despite the additional debt, the ratings on each debt class within the capital structure remain unchanged. Fitch expects that, in a distressed scenario, all secured claims including the senior secured credit facility (at CA and CEH) and the senior secured first priority notes at CEH would obtain full recovery. However, the two unsecured classes (at CA and CCS) would likely be impaired. Compared to Fitch's previous analysis, the estimated recovery value for holders of the unsecured debt held at CCS would be reduced from the high end to the low end of the 'RR5' recovery band (11% to 30%) due to the additional debt. Fitch views the CCS unsecured class as structurally subordinate to the unsecured class at CA, and therefore rates the CA class one notch higher at 'B+/RR4'. Crown maintains debt reduction as a top financial priority, although the company was a net borrower in 2006. Pension contributions, asbestos payments, and shareholder distributions are competing uses of cash. Shareholder focused actions may be gaining a larger share of excess cash distribution. Crown repurchased $135 million of stock in 2006 (after just $38 million in 2005) and has $227 million remaining under its current repurchase authorization. Crown has indicated that excess cash in 2007 will be directed towards debt reduction and share repurchases in roughly a two-thirds, one-third proportion. The company is targeting free cash flow in the $330 million to $370 million range for 2007. After expected cash asbestos payments of about $25 million, Crown could direct $200 million or more towards debt reduction. Greater deleveraging could take place in 2008 if cash flows improve as expected. Fitch believes Crown's free cash flow target is achievable and expects operating cash flows to improve over the intermediate term, driven by volume growth, product mix, and lower pension payments. Fitch expects lower capital spending as certain foreign investment projects have been completed. As of March 31, 2007 the company's liquidity was about $689 million, comprised of $278 million cash and $411 million of available revolver. The company has modest debt maturities of $43 million and $39 million due in 2007 and 2008. Crown's financial position and debt service obligations offer substantial flexibility for the next several years. Crown divested the last of its plastic packaging assets in 2006 and Fitch does not believe further asset sales will be a source of funds for significant debt reduction as they have been in the past. At fiscal year-end 2006 Crown's credit metrics were relatively stable year over year. As of Dec. 31, 2006, the company had operating EBITDA leverage of 4.4 times (x) (compared to 4.3x in 2005) and EBITDA interest coverage of 2.3x (compared to 2.3x in 2005). It should be noted that Fitch's calculation of these ratios is not equivalent to those allowed for covenant compliance, which incorporate a provision for asbestos payments, among other things. Covenants under the senior secured credit facilities limit debt-to-EBITDA to 4.25x through Sept. 30, 2007 and EBITDA interest coverage to 2.75x through the same date. Requirements by FYE2007 will be 4.0x and 2.9x respectively. Asbestos payments and new claims continue to decline steadily. Crown paid $26 million for asbestos related settlements in 2007 compared to $29 million in 2005. New claims fell by nearly 50% year over year and the company expects payments of $25 million in 2007. Looking ahead, key risks and challenges include escalating raw materials and energy costs. Fitch believes Crown may face stronger headwinds from rising raw materials prices, particularly for aluminum in North America, as price ceilings contained in some supplier contracts are removed. These ceilings may have partially shielded the company from the dramatic escalation in aluminum prices in recent quarters. If further cost increases are not completely passed through or if there is a lag in pass through, profitability could be challenged. Crown should continue to see solid volume and revenue growth in certain emerging markets. Productivity and cost reduction initiatives are also beginning to show results so far in 2007. Competition will remain fierce in mature markets and volume losses are always a possibility. However, Crown rebounded strongly from volume losses in early 2006, capturing new volume in higher margin specialty can products. DANA CORPORATION: Reaches Agreement with USW and UAW ---------------------------------------------------- Dana Corporation on Friday disclosed a series of interrelated agreements that will substantially reduce the company's operating costs and provide important momentum toward its emergence from bankruptcy as a competitive, sustainable business. The agreements consist of: - A settlement agreement with each of the United Steel Workers and the United Auto Workers, which will lower Dana's labor costs and replace the company's health care and long-term disability obligations for retirees and employees represented by these unions with Voluntary Employees' Beneficiary Association trusts to which Dana will contribute in aggregate approximately $700 million in cash, less certain benefit payments made prior to the effective date of the company's plan of reorganization, and approximately $80 million in common stock of the reorganized Dana; - An agreement with Centerbridge Capital Partners, L.P., and its affiliates on the terms under which the firm will invest up to $500 million in cash for convertible preferred stock in the reorganized Dana and facilitate an additional investment by other investors of up to $250 million in convertible preferred stock; and - A plan support agreement with the USW, the UAW, and Centerbridge, under which these parties will support a plan of reorganization filed by Dana that includes both the labor settlements and the Centerbridge investment agreement. These agreements are subject to approval by the Bankruptcy Court for the Southern District of New York, where the company's Chapter 11 bankruptcy proceeding is pending. The union settlement agreements are also subject to ratification by Dana's USW and UAW employees, which the unions will seek in the near term. "Through our negotiations with the USW and the UAW, and negotiations with Centerbridge for the investment that will contribute to our ability to fund the VEBAs, we have reached what we believe are fair and constructive agreements," said Mike Burns, Dana's chairman and chief executive officer. "I am particularly pleased that these agreements were reached as a result of a shared commitment - from all of the involved parties - to the long-term success and viability of Dana Corporation." "We welcome the investment by Centerbridge, a private equity investor with considerable expertise in the automotive industry and complex restructurings. Centerbridge brings a long-term perspective and a strong commitment to assisting us in building a solid future for Dana," Mr. Burns added. "While there is a good deal of work yet to be done, we are on track to file a reorganization plan by the beginning of September and to emerge from bankruptcy by year end." Settlements with USW and UAW Encompassed in the settlements with the USW and UAW are four-year extensions of Dana's collective bargaining agreements with all of its USW- and UAW-organized facilities in the United States and new agreements with several recently organized facilities. Among other items, the extended and new bargaining agreements will provide for the establishment of a two-tier wage structure at certain affected U.S. operations, changes in disability benefits, and a freeze on credited service and benefit accruals under the pension plans for active employees represented by the USW and UAW. "These agreements will resolve significant ongoing cost issues when implemented and they provide important momentum toward our completion of a reorganization plan that will position us to operate as a competitive, sustainable business after emergence," Mr. Burns said. Each of the union settlement agreements also calls for the establishment of a VEBA to replace the company's current retiree health care plans and long- term disability obligations for employees covered by USW and UAW collective bargaining agreements. A VEBA is a special, tax-deductible trust that can be used to provide certain benefits, such as medical reimbursement, to participants and their beneficiaries. The settlement agreements provide that upon Dana's emergence from bankruptcy, the company will contribute, in aggregate, approximately $700 million in cash (less certain benefit payments made prior to the effective date of the company's plan of reorganization) and approximately $80 million in common stock of reorganized Dana to the VEBAs in exchange for the termination of Dana's obligation to provide non-pension retiree welfare benefits for USW- and UAW-represented retirees and long-term disability benefits to USW- and UAW-represented employees. The company will continue to provide benefits for these retirees and employees under its existing plans until emergence. Dana currently has an aggregate of approximately $1.1 billion in unfunded non- pension benefit and long-term disability obligations under its U.S. post- retirement health care plans for USW- and UAW-represented retirees and employees. Dana estimates that the modifications to the USW and UAW collective bargaining agreements and other provisions of the union settlement agreements will collectively result in annual savings of more than $100 million. Agreement for Issuance of New Equity Under terms of the investment agreement, Centerbridge will purchase up to $500 million of convertible preferred stock of the reorganized Dana and facilitate an additional investment of up to $250 million in convertible preferred stock. The conversion price will be based on trading prices of common stock of the reorganized Dana during a short period after emergence. Using preliminary forecasts and a preliminary valuation as an estimate of future market trading prices for the reorganized Dana's common stock, the company estimates that the $500 million of convertible preferred shares would represent less than 25% of the fully diluted common stock of the reorganized Dana on an as- converted basis. Proceeds from the investment will be deployed in part to fund the VEBA trusts that will be established under the settlement agreements with the USW and UAW. The closing of the Centerbridge investment will be subject to Dana's filing of a plan of reorganization and a disclosure statement by September 3, 2007, as well as other customary conditions, but will not be subject to further due diligence. Dana will be able to terminate its arrangements with Centerbridge to accept an alternative transaction or plan under certain circumstances, with the reasonable consent of the USW and UAW. Initiatives "Last November, to address the harsh reality that Dana had generated more than $2 billion in losses over the past five years, we announced a series of interdependent restructuring initiatives," Mr. Burns added. "These initiatives, affecting all of the company's constituencies - our customers, suppliers, both union and non-union employees and retirees - were designed to result in an aggregate pre-tax annual income improvement of $405 million to $540 million." The Dana initiatives call for savings in five interrelated areas: 1. Achieving substantial price recovery from customers; 2. Optimizing Dana's U.S. manufacturing footprint, including the moving of certain operations to lower-cost sites; 3. Reducing labor costs by creating a more industry- competitive cost structure; 4. Eliminating retiree health and welfare costs; and 5. Reducing administrative costs. "Without the settlements with the USW and UAW, essential savings in other areas could be jeopardized," Mr. Burns said. "With these settlements, we will be solidly within the range of savings we need to move forward with our plan of reorganization and emerge as a competitive, sustainable business." About Centerbridge Capital Partners L.P. Centerbridge is a $3.2 billion multi-strategy private investment firm. The firm is dedicated to partnering with world-class management teams in a range of industry verticals. Centerbridge's investment style provides the flexibility to employ various strategies to help companies achieve their operating and financial objectives. The limited partners of Centerbridge include many of the world's most prominent financial institutions, university endowments, pension funds, and charitable trusts. About Dana Corp. Toledo, Ohio-based Dana Corp. -- http://www.dana.com/-- (OTC Bulletin Board: DCNAQ) designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off- highway vehicle customers, which collectively produce more than 60 million vehicles annually. The company and its affiliates filed for chapter 11 protection on Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of Sept. 30, 2005, the Debtors listed $7,900,000,000 in total assets and $6,800,000,000 in total debts. Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio, represent the Debtors. Henry S. Miller at Miller Buckfire & Co., LLC, serves as the Debtors' financial advisor and investment banker. Ted Stenger from AlixPartners serves as Dana's Chief Restructuring Officer. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP, represents the Official Committee of Unsecured Creditors. Fried, Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the Official Committee of Equity Security Holders. Stahl Cowen Crowley, LLC serves as counsel to the Official Committee of Non-Union Retirees. The Debtors' exclusive period to file a plan expires on Sept. 3, 2007. They have until Nov. 2, 2007, to solicit acceptances of that plan. DBI INVESTMENTS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: D.B.I. Investments, L.L.C. 20 Swenson Way Dillon, MT 59725 Bankruptcy Case No.: 07-60783 Chapter 11 Petition Date: July 5, 2007 Court: District of Montana (Butte) Judge: Ralph B. Kirscher Debtors' Counsel: James A. Patten, Esq. Patten, Peterman, Bekkedahl & Green Suite 300, The Fratt Building 2817 2nd Avenue N Billings, MT 59101 Tel: (406) 252-8500 Fax: (406) 294-9500 Estimated Assets: $1 Million to $100 Million Estimated Debts: $100,000 to $1 Million The Debtor did not file a list of its largest 20 unsecured creditors. DELTA AIR: Inks Signs Pact Selling ARINC Stake to Carlyle --------------------------------------------------------- Delta Air Lines Inc., along with five other airlines, entered into a Stock Purchase Agreement selling their stake in ARINC Inc. to Radio Acquisition Corp., an affiliate of the Carlyle Group, the Wall Street Journal reports. The five other airlines are: * AMR Corp.'s American Airlines Inc., * UAL Corp.'s United Air Lines Inc., * Continental Airlines Inc., * Northwest Airlines Corp. and * US Airways Group Inc. According to the report, the airlines, who holds over 90% of ARINC shares, expects to gain around $1 billion. The sale is expected to close before Oct. 31, 2007. AMR said that it expects to receive $194 million from the sale while UAL said it expect to get $125 million. WSJ relates that the airlines declined to comment further on the deal. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. - http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About Delta Air Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. Timothy R. Coleman at The Blackstone Group L.P. provides the Debtors with financial advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP, provide the Official Committee of Unsecured Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James S. Feltman at Mesirow Financial Consulting, LLC, serve as the Committee's financial advisors. As of June 30, 2005, the company's balance sheet showed $21.5 billion in assets and $28.5 billion in liabilities. The Debtors filed a chapter 11 plan of reorganization and disclosure statement explaining that plan on Dec. 19, 2007. On Jan 19, 2007, they filed revisions to the plan and disclosure statement, and submitted further revisions to the plan on Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure statement. In April 2007, the Court confirmed the Debtors' plan. * * * As reported in the Troubled Company Reporter on May 2, 2007, Standard & Poor's Ratings Services raised its ratings on Delta Air Lines Inc. (B/Stable/--), including raising the corporate credit rating to 'B', with a stable outlook, from 'D', following the airline's emergence from Chapter 11 bankruptcy proceedings. EISAMAN REAL: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Eisaman Real Estate, Inc. 2217 South Calhoun Street Fort Wayne, IN 46802 Bankruptcy Case No.: 07-11854 Type of Business: The Debtor develops real estate property. Chapter 11 Petition Date: July 5, 2007 Court: Northern District of Indiana (Fort Wayne Division) Judge: Robert E. Grant Debtor's Counsel: Daniel J. Skekloff, Esq. Skekloff, Adelsperger & Kleven, LLP 927 South Harrison Street Fort Wayne, IN 46802 Tel: (260) 407-7000 Fax: (260) 407-7137 Total Assets: $1,374,000 Total Debts: $2,370,559 Debtor's List of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chase Line of Credit $101,448 National Payment Services P.O. Box 182223 Department OH1-1272 Columbus, OH 43218 The Blakley Corporation $18,349 P.O. Box 50770 Indianapolis, IN 46250 Menard's Materials $9,583 P.O. Box 5219 Carol Stream, IL 60197 JS Construction Services $5,840 Lowes GE Consumer Finance Materials $5,252 DeLage Landen Lease $4,960 Fort Wayne Newspapers Services $4,107 CFS Carpet $3,663 Builder's Mart Materials $3,118 Lisa and Larry Mitchell $3,000 City Glass Specialty, Inc. Materials $2,884 Chase $2,595 NASF Checking Overdraft $2,595 Mail Inc. Services $2,329 Imagistics International Inc. Services $2,051 Porters Paint Materials $1,748 Home Appliance Leasing Corp. Services $1,192 Offset One Services $1,031 Sherwin Williams Materials $999 Beckman Lawson, LLP Materials $844 EMERITUS CORP: Nets $305.3 Million from Public Offering ------------------------------------------------------- Emeritus Corporation has closed the public offering of 11,000,000 shares of common stock on July 3, 2007. Approximately 10,500,000 shares were sold by the company and 500,000 shares were sold by certain selling shareholders. The company received net proceeds of approximately $305.3 million after closing costs. The proceeds from the offering will be used to retire approximately $82.3 million in long-term debt and to pay $181.4 million of the purchase price of approximately $595.1 million, excluding closing costs for the acquisition of 52 properties, 44 of which are currently operated by the company under long-term leases and eight of which are currently operated by Summerville Senior Living Inc. under long-term leases. The balance of $41.6 million will be used to finance facility development, facility acquisitions and capital expenditures, and also for other general corporate purposes. "We believe the closing of our public offering and the subsequent acquisition of 52 properties, along with the pending merger with Summerville Senior Living Inc., has put Emeritus in a strong position in the senior healthcare market and will allow us the flexibility to continue to grow the business well into the future," Dan Baty, CEO and chairman of the board, stated. About Emeritus Corporation Headquartered in Seattle, Washington, Emeritus Corporation (AMEX: ESC) - http://www.emeritus.com/--is a national provider of assisted living and Alzheimer's and related dementia care services to seniors. Emeritus is one of the operators of freestanding assisted living communities located throughout the United States. These communities provide a residential housing alternative for senior citizens who need help with the activities of daily living with an emphasis on assistance with personal care services to provide residents with an opportunity for support in the aging process. Emeritus currently operates 206 communities representing capacity for approximately 20,000 residents in 34 states. At March 31, 2007, the company's balance sheet showed total assets of $953 million and total liabilities of $1.1 billion, resulting to a total shareholders' deficit of $111.6 million. FIFTH AVENUE: Case Summary & Seven Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Fifth Avenue Center, Inc. P. O. Box 3248 Los Altos, CA 94024-0248S Bankruptcy Case No.: 07-30841 Chapter 11 Petition Date: July 5, 2007 Court: Northern District of California (San Francisco) Judge: Thomas E. Carlson Debtor's Counsel: Ruth Elin Auerbach, Esq. 711 Van Ness Avenue, Suite 440 San Francisco, CA 94102 Tel: (415) 673-0560 Fax: (415) 673-0562 Estimated Assets: $100,000 to $1 Million Estimated Debts: $1 Million to $100 Million Debtor's List of its Seven Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Sierra Energy $1,700,000 c/o Bullivant Houser Bailey 1415 L Street, Suite 1000 Sacramento, CA 95814 Wholesale Fuels $298,000 2200 East Brundage Lane Bakersfield, CA 93307 IPC $70,000 333 City Boulevard, West Suite 650 Orange, CA 92868 Granite State Insurance Co. $55,872 Coast Oil $29,000 Daniel Bronson dba A Plus Electric $8,712 Margaret S. Elrod $1,328 FORMICA BERMUDA: Fletcher Deal Cues S&P to Withdraw Ratings ----------------------------------------------------------- Standard & Poor's Ratings Services withdrew its 'B' corporate credit and senior secured debt ratings on Formica Bermuda Holdings Ltd. S&P also removed the ratings from CreditWatch with developing implications where they were placed May 23, 2007. The withdrawal follows the announcement by the company's parent, Formica Corp. that its previously announced acquisition by New Zealand-based Fletcher Building Ltd. had been completed. GENER8XION ENT: Posts $455,779 Net Loss in Quarter Ended March 31 ----------------------------------------------------------------- Gener8Xion Entertainment Inc. reported a net loss of $455,779 on revenue of $4.1 million for the second quarter ended April 30, 2007, compared with a net loss of $2.6 million on revenue of $535,502 for the same period ended April 30, 2006. The increase in revenue is mainly attributable to the increase in production revenue. The increase in production revenue was partly offset by the decrease in revenue from lighting products sales. The decrease in net loss for the three months ended April 30, 2007, is primarily due to the revenue earned on the release of the movie, "One Night with the King," and the decrease in general and administrative expenses. At March 31, 2007, the company's consolidated balance sheet showed $7.4 million in total assets, $6.4 million in total liabilities, and $940,860 in 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?2171 Going Concern Doubt As reported in the Troubled Company Reporter on Feb. 20, 2007, Stonefield Josephson Inc. in Los Angeles, California, expressed substantial doubt about Gener8Xion Entertainment Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Oct. 31, 2006. The auditing firm pointed to the company's operating losses since inception. About Gener8Xion Entertainment Based in Burbank, California, Gener8Xion Entertainment Inc. (OTC BB: GNXE.OB) -- http://www.8x.com/-- is an integrated media company engaged in various operating activities including film and television production and distribution, sales and rentals of film and video equipment, systems integration and studio facility management. GENERAL GROWTH: Declares $0.45 per Share Dividend due July 31 ------------------------------------------------------------- General Growth Properties Inc. declared a dividend of $0.45 per share, payable July 31, 2007, to common stockholders of record as of July 17, 2007. The current dividend represents an increase of 9.8% over the comparable period one year ago. Headquartered in Chicago, Illinois, General Growth Properties Inc. (NYSE: GGP) -- https://www.generalgrowth.com/ -- is a publicly traded Real Estate Investment Trust. Including predecessor companies, GGP has been in the shopping center business for over fifty years. General Growth owns, develops, operates, and/or manages shopping malls in 44 states, well as Master Planned Communities in three states, including Summerlin in Nevada, The Woodlands and Bridgeland in Texas, and Columbia in Maryland. * * * Fitch rated its long term issuer default rating at BB and its bank loan debt at BB on April 2005. Moody's Investor Services assigned Ba2 rating on General Growth Properties Inc.'s bank loan debt on October 2004. The outlook is stable. GENESIS HEALTHCARE: Tender Offers of Senior Notes Expires Today --------------------------------------------------------------- GEN Acquisition Corp. has extended its cash tender offers and consent solicitations with respect to any and all of the 8% Senior Subordinated Notes due 2013 (CUSIP Nos. 37184DAC5 and 37184DAA9) and any and all of the 2.5% Convertible Senior Subordinated Debentures due 2025 (CUSIP Nos. 37184DAE1 and 37184DAD3), issued by Genesis HealthCare Corporation. The new Expiration Date for both tender offers is 5:00 p.m., New York City time, on July 9, 2007, unless the tender offers are further extended or earlier terminated by GEN Acquisition at its discretion. The terms of the tender offers are amended accordingly. The tender offers were made in connection with the agreement and plan of merger dated as of Jan. 15, 2007, as amended, among GEN Acquisition, GHC and GEN Acquisition's parent, FC-GEN Acquisition, Inc., that provides for the merger of GEN Acquisition with and into GHC, with GHC being the surviving corporation in the merger. GEN Acquisition and Parent are owned by affiliates of Formation Capital LLC and affiliates of JER Partners, which is the private equity investment group affiliated with J.E. Robert Company Inc. The tender offers were extended to coordinate the expiration of the tender offers with the closing of the Acquisition. GEN Acquisition has received tenders from holders of 100% of the 8% Notes and 100% of the 2.5% Notes. GEN Acquisition reserves the right to terminate, withdraw or amend the tender offers and consent solicitations at any time, subject to applicable law. GEN Acquisition has retained UBS Investment Bank to act as Dealer Manager in connection with the tender offers and consent solicitations. Questions about the tender offers and consent solicitations may be directed to the Liability Management Group of UBS Investment Bank at (888) 722-9555 x3374210 (toll free) or (203) 719-4210 (collect). Copies of the Tender Offer Documents and other related documents may be obtained from Innisfree M&A Incorporated, the information agent for the tender offers and consent solicitations, at (888) 750-5834 (noteholders call toll-free) or (212) 750-5833 (banks and brokers call collect). The tender offers and consent solicitations are being made solely by means of the Tender Offer Documents. About Genesis HealthCare Corporation Headquartered in Kennett Square, Pennsylvania, Genesis HealthCare Corporation (NASDAQ: GHCI) -- http://www.genesishcc.com/-- is one of the United States' long-term care providers with over 200 skilled nursing centers and assisted living residences in 13 eastern states. Genesis also supplies contract rehabilitation therapy to over 600 healthcare providers in 20 states and the District of Columbia. * * * Moody's Investor Services assigned B1 rating on Genesis HealthCare Corporation's senior subordinate debt and Ba3 rating on probability of default effective Jan. 17, 2007. Standard and Poors' rated B+ its long term foreign and local issuer credit. HAIGHTS CROSS: Inks Recapitalization Pact with Investors -------------------------------------------------------- Haights Cross Communications, Inc., disclosed Friday that it has entered into a recapitalization agreement with its key investors, which, if completed, would result in a: * simplified capital structure through the elimination of its three classes of preferred stock, * reconstitution of its board of directors, and * dismissal of a lawsuit filed against the company by certain investors in HCC's Series B Senior Preferred Stock. Under the terms of the recapitalization agreement, holders of the company's Series B Senior Preferred Stock, together with the holders of its Series A Preferred Stock, Series C Preferred Stock, and Series A warrants, would convert all of their shares and warrants into common stock and warrants to purchase common stock at agreed upon rates, while all existing shares of common stock and common stock warrants and options would be effectively eliminated. In addition, certain members of management would acquire new shares of common stock under the terms of a management stock purchase agreement. If the recapitalization is completed, current holders of the Series B Senior Preferred Stock would own approximately 82% of the outstanding shares of common stock, while current holders of the Series A and Series C Preferred Stock would collectively own approximately 15% of the company's common stock, and management would own the remaining 3%. Under the terms of a shareholders agreement to be entered into at the closing of the recapitalization, a new six member Board of Directors would be composed of Mr. Peter J. Quandt, our current Chairman and Chief Executive Officer, and five persons designated by various former Series B and Series A holders. Finally, upon the closing, the company and certain Series B holders would enter into a release agreement, pursuant to which, among other things, such holders would dismiss a pending legal action against the company filed by certain investors in HCC's Series B Senior Preferred Stock, in which they have asserted claims under 8 Del. Code. ss. 220 and under a certain Investors Agreement, dated December 10, 1999, seeking access to the company's books and records. Peter Quandt commented, "The recapitalization agreement represents a significant milestone for Haights Cross. We are pleased to have resolved the dispute with some of our equity investors which will allow us to move forward with our business plans." The closing of the recapitalization agreement is subject to the satisfaction of certain stated conditions, including: (i) the waiver by the requisite holders of the company's Senior Secured Term Loans, Senior Notes and Senior Discount Notes of applicable "change of control" covenants that, absent such waiver, might apply in connection with the conversion of the preferred stock into common stock, and (ii) the execution and delivery of the agreements referred to above. Evercore Partners served as financial advisor to the company in completing the recapitalization agreement and will assist the company in evaluating strategic alternatives following the closing of the recapitalization. A full-text copy of the Recapitalization Agreement dated June 29, 2007 is available for free at http://ResearchArchives.com/t/s?2174 About Haights Cross Founded in 1997 and based in White Plains, New York, Haights Cross Communications Inc. -- http://www.haightscross.com/-- is a premier educational and library publisher dedicated to creating the finest books, audio products, periodicals, software and online services, serving the following markets: K-12 supplemental education, public library and school publishing, audio books, and medical continuing education publishing. Haights Cross companies include: Sundance/Newbridge Educational Publishing (Northborough, MA), Triumph Learning (New York, NY), Buckle Down Publishing (Iowa City, IA), Options Publishing (Merrimack, NH), Recorded Books (Prince Frederick, MD), and Oakstone Publishing (Birmingham, AL). * * * As reported in the Troubled Company Reporter on June 8, 2007, Standard & Poor's Ratings Services placed its ratings on Haights Cross Communications Inc., including the 'CCC+' corporate credit rating, and ratings on subsidiary Haights Cross Operating Co. on CreditWatch with negative implications, based on Standard & Poor's concern about HCC's recent receipt of a notice of default from the trustee of certain of its unsecured debt issues based on its delinquency in filing financial statements. HAIGHTS CROSS: Okays Enhanced Severance Payments for Key Employees ------------------------------------------------------------------ Haights Cross Communications, Inc., disclosed that in connection with the Recapitalization Agreement, the company approved a plan providing for enhanced severance payments to be made to an identified group of key employees. Under this plan, a participating employee would receive the enhanced severance benefit if such employee's employment with the company or the business unit of the Company at which such employee works is terminated involuntarily without cause or voluntarily for good reason during the one year period following the sale of the company or the applicable business unit. The enhanced severance benefit for a participating employee would consist of salary and medical benefit continuation for a specified severance period, with the salary benefit to be payable in a lump sum. The severance period would range from six to 18 months, depending on the participating employee's job classification. Ms. Linda Koons, the company's Executive Vice President and Publisher, Mr. Kevin M. McAliley, the company's Executive Vice President and the President of Triumph Learning, and Mr. Mark Kurtz, the Company's Vice President, Accounting and Finance, and Chief Accounting Officer, each of whom are "named executive officers," will be participating employees under the plan. Under the plan, the severance period for Ms. Koons and Mr. McAliley in respect of a qualifying termination following a sale would be 18 months and the severance period for Mr. Kurtz would be 12 months. These severance periods represent an increase of six months from each such named executive officer's regular severance arrangement. About Haights Cross Founded in 1997 and based in White Plains, New York, Haights Cross Communications Inc. -- http://www.haightscross.com/-- is a premier educational and library publisher dedicated to creating the finest books, audio products, periodicals, software and online services, serving the following markets: K-12 supplemental education, public library and school publishing, audio books, and medical continuing education publishing. Haights Cross companies include: Sundance/Newbridge Educational Publishing (Northborough, MA), Triumph Learning (New York, NY), Buckle Down Publishing (Iowa City, IA), Options Publishing (Merrimack, NH), Recorded Books (Prince Frederick, MD), and Oakstone Publishing (Birmingham, AL). * * * As reported in the Troubled Company Reporter on June 8, 2007, Standard & Poor's Ratings Services placed its ratings on Haights Cross Communications Inc., including the 'CCC+' corporate credit rating, and ratings on subsidiary Haights Cross Operating Co. on CreditWatch with negative implications, based on Standard & Poor's concern about HCC's recent receipt of a notice of default from the trustee of certain of its unsecured debt issues based on its delinquency in filing financial statements. HAIGHTS CROSS: Unit Receives Default Notice from Bear Stearns ------------------------------------------------------------- Haights Cross Communications, Inc., disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that on June 19, 2007, its wholly owned subsidiary, Haights Cross Operating Company, received a notice of default from Bear Stearns Corporate Lending Inc. Bear Stearns is the as administrative agent under: (i) HCOC's $100 million Senior Secured Term Loan Agreement, dated as of August 20, 2003, by and among HCOC, the Agent, and other parties, and (ii) HCOC's $30 million Senior Secured Term Loan Agreement, dated as of December 10, 2004, by and among HCOC, the Agent, and other parties. Under Section 6.1(a)(i) of the respective Term Loan Agreements, the company, and HCOC, is, among other things, required to timely deliver to the Agent within the time periods specified by the Commission's rules and regulations the financial information required to be contained in the company's Annual Report and subsequent Quarterly Reports on Form 10-Q and to file all such information with the Commission. The Agent provided the notice to notify HCOC that it is in violation of Section 6.1(a)(i) of the applicable Term Loan Agreements as a result of the company's delay in the filing of the Annual Report, and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2007. In addition, as a result of the delay in the filing of the financial information, the interest rate on the outstanding balance under the First Term Loan Agreement increased as of April 18, 2007 from 9.86% to 11.36%. The higher rate will remain in effect until one business day after the financial information is filed. The Term Loan Agreements provide that HCOC has 60 days from receipt of a notice of default to cure such default before an event of default occurs under the Term Loan Agreements. If an event of default occurs under the Term Loan Agreements, then the Agent or the lenders holding at least 25% in aggregate principal amount of the loans then outstanding under each Term Loan Agreement may thereafter choose to declare all loans then outstanding under such Term Loan Agreement to be due and payable immediately, subject to any agreed upon waiver or rescission of acceleration. As of June 22, 2007, $96.3 million and $29.3 million were outstanding under the First Term Loan Agreement and the Second Term Loan Agreement, respectively. A failure by HCOC to observe any covenant under the Term Loan Agreements, which failure entitles the requisite holders of the loans issued under the Term Loan Agreements or the Agent to accelerate the loans issued under the Term Loan Agreements, also would constitute an event of default under HCOC's $30 million Senior Secured Revolving Credit Facility, upon which HCOC has never drawn and which has $0 in principal balance outstanding, HCOC's Indenture for its 11-3/4% Senior Notes due 2011, and the company's Indenture for the company's 12-1/2% Senior Discount Notes due 2011, which could lead to an acceleration of the unpaid principal and accrued interest under such agreements unless a waiver is obtained. As of June 22, 2007, $0 was outstanding under the Senior Facility and $111.1 million and $170.0 million of the 12-1/2% Notes and 11-3/4% Notes, respectively, were outstanding. Filing Delay The company, on April 2, 2007, filed a Notification of Late Filing with the SEC relating to the its inability to file on a timely basis the company's Annual Report on Form 10-K for the year ended December 31, 2006 as a result of: (i) the need to complete work on a restatement of the company's financial statements for specified reasons, which the company has completed, and (ii) the need to further investigate, and to allow its independent accountants to conduct additional procedures with respect to, matters of disagreement that one of its directors had expressed concerning certain disclosures in the company's proposed Compensation Discussion & Analysis to be included in the Annual Report. On April 17, 2007, the company said that it was not yet in a position to file the Annual Report insofar as the investigation was still ongoing. Other Default Notices AS previously reported in the Troubled Company Reporter, the company, on May 29, 2007, received a notice of default from Wells Fargo Bank, National Association, as trustee under the company's indenture for the company's 12-1/2% Senior Discount Notes due 2011. On the same day, the company, on behalf of HCOC, received a notice of default from the Trustee, as trustee under HCOC's indenture for HCOC's 11-3/4% Senior Notes due 2011. About Haights Cross Founded in 1997 and based in White Plains, New York, Haights Cross Communications Inc. -- http://www.haightscross.com/-- is a premier educational and library publisher dedicated to creating the finest books, audio products, periodicals, software and online services, serving the following markets: K-12 supplemental education, public library and school publishing, audio books, and medical continuing education publishing. Haights Cross companies include: Sundance/Newbridge Educational Publishing (Northborough, MA), Triumph Learning (New York, NY), Buckle Down Publishing (Iowa City, IA), Options Publishing (Merrimack, NH), Recorded Books (Prince Frederick, MD), and Oakstone Publishing (Birmingham, AL). * * * As reported in the Troubled Company Reporter on June 8, 2007, Standard & Poor's Ratings Services placed its ratings on Haights Cross Communications Inc., including the 'CCC+' corporate credit rating, and ratings on subsidiary Haights Cross Operating Co. on CreditWatch with negative implications, based on Standard & Poor's concern about HCC's recent receipt of a notice of default from the trustee of certain of its unsecured debt issues based on its delinquency in filing financial statements. HEXION SPECIALTY: Huntsman Offer Cues S&P's Negative Watch ---------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B' corporate credit rating and other ratings on Columbus, Ohio-based Hexion Specialty Chemicals Inc. on CreditWatch with negative implications. The ratings on related entities were also placed on CreditWatch. "The rating action follows Hexion's announcement that it has made a definitive proposal to acquire Huntsman Corp. for $10.14 billion, including debt," said Standard & Poor's credit analyst Paul Kurias. In addition, there is a provision for an 8% increase in the offer should the transaction, which is subject to shareholder and regulatory approval, take more than nine months to complete. At March 31, 2007, Hexion had approximately $3.7 billion in adjusted debt and about $5.3 billion in revenues. The proposed acquisition is large relative to Hexion's existing operations, and will result in a global and highly diversified chemicals producer with over $15 billion in annual revenue. If completed, the transaction could elevate Hexion's business profile given the improved product mix, better diversification, and less dependency on Hexion's core resins product. However, the financing of the transaction is likely to result in a highly aggressive capital structure, more than offsetting the expected benefits to the business profile. S&P's note that Hexion is already highly leveraged with total debt to EBITDA above 5x, and that a debt-financed transaction could further stretch the financial profile, even beyond a level appropriate for the existing 'B' corporate credit rating. S&P ratings on Salt Lake City, Utah-based Huntsman Corp. and all related entities remain on CreditWatch with negative implications, where they were placed on June 26, 2007. The initial CreditWatch listing reflected concerns following the announcement that Luxembourg-based Basell AF S.C.A. and Huntsman had entered into a definitive agreement under which Basell plans to acquire Huntsman for $9.6 billion. The transaction, which is subject to shareholder and regulatory approval, has been approved by Huntsman's board of directors and has the support of MatlinPatterson and the Huntsman family, who collectively own 57% of Huntsman's common stock. It is now unclear which transaction will be successful, although both have the strong potential to result in downgrades. S&P will resolve the CreditWatch on Hexion after meeting with management to evaluate in detail the financing plans, financial policies and strategy for the combined company, and the impact of such a combination on the business and financial risk profiles. HILTON HOTELS: Shares Up 37% to $45.71 -------------------------------------- Hilton Hotels Corporation's shares closed at $45.71 Friday, marking a 37% increase and the company's highest since July 1980, Michael Patterson of Bloomberg Reports. As reported in the Troubled Company Reporter on July 5, 2007, the company entered into a definitive merger agreement with The Blackstone Group in an all-cash transaction valued at approzimately $26 billion. Under the agreement, Blackstone will purchase all of Hilton's outstanding common stock at $47.50 per share. Rating Actions As reported in the Troubled Company Reporter on July 6, 2007, as a result of its transaction with Blackstone, Fitch Ratings downgraded Hilton Hotels' issuer default rating to B from BB+. Fitch says that although the terms of the transaction and prospective capital structure have yet to be finalized, it believes that the deal will likely result in a substantial increase in leverage more consistent with ratings in the 'B' category. Fitch also placed all of Hilton Hotel's ratings under Rating Watch Negative. At the same time, Standard & Poor's Ratings Services also lowered its corporate credit rating on Hilton Hotels to BB- from BB+. According to S&P credit analyst Emile Courtney, the BB- rating reflects S&P's expectation the deal will be completed and represents the highest outcome that S&P deems appropriate given its review on preliminary information available. S&P also placed Hilton Hotels' ratings on CrediWatch with negative implications. About Hilton Hotels Corporation Headquartered in Beverly Hills, California, Hilton Hotels Corp. -- http://www.hilton.com/-- together with its subsidiaries, engages in the ownership, management, and development of hotels, resorts, and timeshare properties, as well as in the franchising of lodging properties in the United States and internationally, including Australia, Austria, Barbados, Finland, India, Indonesia, Trinidad and Tobago, Philippines and Vietnam. HILTON HOTELS: Blackstone Agreement Cues Moody's to Review Ratings ------------------------------------------------------------------ Moody's Investors Service placed the ratings of Hilton Hotels Corporation on review for downgrade following its announcement that it entered into a definitive merger agreement with The Blackstone Group's real estate and corporate private equity funds in an all-cash transaction. A Blackstone affiliate will acquire all of Hilton's outstanding common for $47.50 per share, a 40% premium over its closing stock price on July 2, 2007, and Hilton Hotels Corporation will be the surviving entity. The LGD assessments are also subject to change. The total transaction value is $26 billion including the assumption of about $6 billion of debt. Blackstone received financing commitments from a group of financial institution, but details were not disclosed. The merger is subject to shareholder approval and is expected to close in the fourth quarter of 2007. Pursuant to the Agreement and Plan of Merger, Hilton is expected to tender for all its outstanding senior notes. The indentures governing the company's existing public debt include a limitation on liens of 15% of Consolidated Net Tangible Assets, as defined. The review for downgrade will focus on Hilton's capital structure post closing. Ratings placed on review for downgrade: -- Corporate Family rating at Ba1 -- Probability of default at Ba1 -- Senior notes at Ba1, LGD 4 -- Senior bank credit facilities at Ba1, LGD 4 -- Senior, subordinated and preferred shelf at (P) Ba1, LGD 4, (P) Ba2, LGD 6, (P) Ba2,LGD 6 respectively Ratings withdrawn: -- Commercial paper at Not Prime. Hilton Hotels Corporation owns, manages or franchises a hotel portfolio including Hilton(R), Conrad(R) Hotels & Resorts, Doubletree(R), Embassy Suites Hotels(R), Hampton Inn(R), Hampton Inn & Suites(R), Hilton Garden Inn(R), Hilton Grand Vacations(TM), Homewood Suites by Hilton(R) and The Waldorf=Astoria Collection(R). The company's portfolio includes more than 2,800 hotels and 480,000 rooms in 76 countries and territories. Revenues, net of cost reimbursements, for the last twelve months ended March 31, 2007 was about $6.4 billion. The Blackstone Group is a global alternative asset manager and provider of financial advisory services. Its alternative asset management businesses include the management of corporate private equity funds, real estate opportunity funds, funds of hedge funds, mezzanine funds, senior debt funds, proprietary hedge funds and closed-end mutual funds. IMAX CORP: Expects to File Annual Report Before August 1 -------------------------------------------------------- IMAX Corporation Friday provided a status update pursuant to the alternative information guidelines of the Ontario Securities Commission. These guidelines contemplate that the company will normally provide bi-weekly updates on its affairs until such time as the Company is current with its filing obligations under applicable Canadian provincial securities laws. The company reported that, with regard to its accounting review in connection with revenue recognition for the years 2002 through 2006, it has submitted a response to comments received from the staff of the U.S. Securities and Exchange Commission, and believes that it has substantially addressed these comments by revising its accounting policy with regard to revenue recognition for theatre systems and by committing to incorporate certain other changes in its financial statements and other disclosures in the 2006 Annual Report on Form 10-K. Accordingly, the company plans to file both its 10-K and Report on Form 10-Q for the fiscal quarter ended March 31, 2007 shortly. The company previously said that it would delay the filing of its 10-K and 10-Q due to the discovery of certain accounting errors and has since broadened its accounting review to include certain other accounting matters based on comments received by the Company from the SEC and OSC. The principal changes to the company's revenue recognition policy with regard to theatre systems are to reflect: a) the treatment of the theatre system equipment (including the projector, sound system, screen and, if applicable, 3D glasses cleaning machine) and certain services associated with the theatre system equipment as a single deliverable and a single unit of accounting, and b) the requirement to have a signed customer acceptance prior to revenue recognition. These revisions will be treated as a correction of an error. The policy and the revisions will be discussed in greater detail in the Company's 10-K. Default As reported in the Troubled Company Reporter on July 2, 2007, the company was unable to file its Annual Report on Form 10-K by the June 30, 2007 deadline. As a result, the company is in default of the reporting covenant under the indenture governing its 9-5/8% senior notes dues 2010. The company received notice of default on July 2, 2007. However, the company expects to make such filings prior to August 1, 2007, the expiration of the 30-day period, after notice of default which allows for the cure of such default under the Indenture before holders can seek to accelerate the indebtedness. Nasdaq Listing As reported in the Troubled Company Reporter on July 5, 2007, the Nasdaq Listing Qualifications Panel has granted the company's request for continued listing of its shares on The Nasdaq Stock Market. The decision is subject to the condition that the company files its Form 10-K for the fiscal year ended Dec. 31, 2006, its Form 10-Q for the fiscal quarter ended March 31, 2007, and all required restatements, on or before Oct. 1, 2007, and that it continue to meet all other Nasdaq listing requirements. The company's next bi-weekly status update is expected to be released during the week of July 16, 2007. About IMAX Corporation Headquartered jointly in New York City and Toronto, Canada, IMAX Corporation -- http://www.imax.com/-- (NASDAQ:IMAX; TSX:IMX) is one of the world's leading entertainment technology companies, with particular emphasis on film and digital imaging technologies including 3D, post-production and digital projection. IMAX is a fully-integrated, out-of-home entertainment enterprise with activities ranging from the design, leasing, marketing, maintenance, and operation of IMAX(R) theatre systems to film development, production, post-production and distribution of large-format films. IMAX also designs and manufactures cameras, projectors and consistently commits significant funding to ongoing research and development. IMAX has locations in Guatemala, India, Italy, among others. As of September 30, 2006, there were 280 IMAX theatres operating in 40 countries. INSIGHT HEALTH: Noteholders Supports Amended Prepackaged Plan ------------------------------------------------------------- The ad hoc committee representing holders of subordinated notes issued by InSight Health Services Holdings Corp. and its debtor- affiliate, InSight Health Services Corp. reiterated its support for approval of the Debtors' Joint Prepackaged Chapter 11 Plan of Reorganization as modified, Bill Rochelle of Bloomberg News reports. The Ad Hoc Committee said in a court filing cited by Bloomberg that the noteholders will be damaged by delay, noting that 70% of the noteholders have reaffirmed their support for the Plan. Earlier, Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, objected to the Debtors' Plan arguing, among others, that the Plan is "unconfirmable" because it does not comply with all applicable provisions of the U.S. Bankruptcy Code as the Plan, as amended, was not properly solicited. Ms. Stapleton pointed out that pursuant to Rule 3019 of the Bankruptcy Code, the U.S. Bankruptcy Court for the District of Delaware must hold a hearing to determine whether the plan adversely changes the treatment of a creditor or security holder. In addition, Ms. Stapleton said Rule 3019 places the burden on the Court to ensure that the proposed modification does not adversely change the treatment of a claim of any creditor or the interest of any equity holder who has not accepted in writing the modification. Hence, the U.S. Trustee said, if the modification adversely affects a creditor in more than a purely ministerial manner, such creditor should have the opportunity to reconsider and change its vote. Treatment of Claims Under the Second Amended Plan, the Debtors propose to pay holders of Secured and General Unsecured Claims in full and in cash, on the distribution date. On the effective date, each holder of FRN Claims will be reinstated. FRN refers to the senior secured floating rates notes due 2001 of the Debtors. Each holder of Intercompany Claims will also be reinstated. At the Debtors' option, holders of Other Secured Claims will have, either: a. the property that serves as collateral for the holder's claims returned; or b. holder's claim cured and reinstated pursuant to Section 1124(2) of the Bankruptcy Code. The SSN Indenture Trustee will distribute to each holder of SSN Claim a pro rata share of 90% of the aggregate new common stock. The SSN refers to the Debtors' 9.875% senior subordinated notes dues 2001. On the distribution date, each holder of Old Common Stock Interest will receive a pro rata of 10% of the aggregate new common stock. Holders of Other Interests will not receive any distribution and will be cancelled. About InSight Health Based in Lake Forest, California, InSight Health Services Holdings Corp. -- http://www.insighthealth.com/-- is a nationwide provider of diagnostic imaging services. It serves managed care entities, hospitals and other contractual customers in over 30 states, including the following targeted regional markets: California, Arizona, New England, the Carolinas, Florida and the Mid-Atlantic states. InSight's network consisted of 109 fixed-site centers and 108 mobile facilities as of Dec. 31, 2006. The company and its affiliate, InSight Health Services Corp., filed for Chapter 11 protection on May 29, 2007 (Bankr. D. Del. Case Nos. 07-10700 and 07-10701). Daniel J. DeFranceschi, Esq., Jason M. Madron, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, represent the Debtors. In schedules filed with the Court, Insight Health Services Holdings disclosed total assets of $87,102,870 and total debts of $525,448,053. Its debtor-affiliates, Insight Health Services Corp., disclosed total assets of $505,285,296 and total debts of $525,500,934. INTERTAPE POLYMER: Shareholders Reject Proposal to Sell Company --------------------------------------------------------------- Intertape Polymer Group Inc. disclosed that at its annual and special meeting held Thursday, shareholders rejected, by a vote of almost 70%, a special resolution with respect to Intertape Polymer's Plan of Arrangement, providing for the sale of the company. Intertape Polymer has notified the other parties to the Arrangement Agreement that, as a result, the agreement has been terminated. Sale of Company The company previously disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that on May 24, 2007, the Superior Court of Quebec issued an interim order in connection with the proposed plan of arrangement involving the company and an indirect wholly-owned subsidiary of Littlejohn Fund III, L.P., pursuant to which all of the outstanding common shares of the Company are to be acquired at a price of $4.76 per share in cash. New Directors The company also reported that at the same meeting, Eric E. Baker, Melbourne F. Yull and H. Dale McSween, were elected to the Board of Directors. At a meeting held immediately after the shareholders' meeting, the newly-elected Board of Directors appointed Eric E. Baker as Chairman of the Board and Melbourne F. Yull as Executive Director of Intertape Polymer. The Board of Directors also appointed George J. Bunze to the Board of Directors, pursuant to the company's Articles, so that the Board consists of Eric E. Baker, Melbourne F. Yull, H. Dale McSween and George J. Bunze. Eric E. Baker, the newly-appointed Chairman of the Board said: "We thank the many shareholders who voted at the meeting. Their message is clear. The new Board of Directors will do everything it can to return Intertape Polymer to a strong financial position." "We also wish to thank Dale McSween for agreeing to continue on the Board of Directors" added Mr. Baker. "Although Dale is no longer Chief Executive Officer, he will provide important continuity during this transition phase for Intertape Polymer." About Intertape Polymer Intertape Polymer Group Inc. -- http://www.intertapepolymer.com/ -- (NYSE, ITP; TSX: ITP.TO) develops and manufactures specialized polyolefin plastic and paper-based packaging products and complementary packaging systems for industrial and retail use. Headquartered in Montreal, Quebec and Sarasota/Bradenton, Florida, the company employs approximately 2,100 employees with operations in 17 locations, including 13 manufacturing facilities in North America and one in Europe. INTERTAPE POLYMER: Moody's Puts Rating on Review & May Downgrade ---------------------------------------------------------------- Moody's Investors Service placed the long term debt and corporate family ratings of IPG (US) Inc. and Intertape Polymer US Inc. under review for possible downgrade as a result of the company's recent announcement that shareholders rejected the sale of the company to Littlejohn Fund III, L.P. In a related action, Moody's withdrew the ratings of Tape Borrower Inc.'s (the proposed new parent company of Intertape Polymer Group) term loans and revolving credit facility. The B3 corporate family rating and SGL-4 speculative grade liquidity rating have been reassigned to IPG (US) Inc. The review was prompted by Moody's concern with the company's ability to meet the financial covenants in its $75 million secured revolving credit facility over the next 3-6 months as the company's leverage covenant has stepped down to 5.5x as of June 30, 2007. With the recent changes in the Board of Directors and the likely need to renegotiate the covenants in the bank agreement, Moody's review would also seek to determine the new management's financial and operational strategies given the difficult operational environment. Moody's was concerned that the recent changes in the Board could have triggered a default under the change of control provisions in its credit agreement and note indenture. However, after receiving further details from the company, it does not appear that a change of control has occurred. The review will also examine: 1) potential options that the Board may pursue in order to solidify IPG's capital structure; and 2) the succession plan for senior management at IPG. Moody's expects to complete this review within 90 days. If IPG's financial and operational strategies and management succession plan prove to be unsatisfactory, or if the company experiences a deterioration in operating performance or credit metrics because of a decline in product demand or other operational issues, or if the company is unable to successfully amend its credit agreement, a downgrade of the ratings may be warranted. Review for Possible Downgrade: Issuer: IPG (US) Inc. * Corporate Family Rating, B3 * Senior Secured Bank Credit Facility, B1 Issuer: Intertape Polymer US Inc. * Senior Subordinated Regular Bond/Debenture, Caa2 Intertape Polymer Group, Inc., a parent company of IPG and Intertape Polymer US Inc., is a manufacturer and marketer of adhesive tapes, specialty tapes, plastic films and engineered coated products. The company is headquartered in Bradenton, Florida. J&F I FINANCE: S&P Puts Corporate Credit Rating at B ---------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to J&F I Finance Co., and its 'B-' unsecured debt rating to J&F I Finance's proposed: * $200 million of senior notes due 2015, * $200 million of senior toggle notes due 2015, and * $200 million of senior floating rate notes due 2014. J&F I Finance Co. will be merged with and into Swift & Co. At the same time, Standard & Poor's revised the CreditWatch implications of all ratings on Swift, including the 'B' corporate credit rating, to positive from developing, where they were placed on May 29, 2007, following JBS S.A.'s (JBS; B+/Watch Neg/--) announcement that its holding company J&F Participacoes (J&F; not rated) had signed an agreement for the acquisition of 100% of U.S.-based Swift for $1.4 billion (enterprise value). All ratings on J&F I Finance are placed on CreditWatch with positive implications, meaning the ratings may be raised or affirmed following the completion of Standard & Poor's review. The ratings on Brazil-based meat processing company JBS remain on CreditWatch with negative implications, where they were placed on May 29, 2007 following the Swift acquisition announcement. Proceeds from the proposed notes offerings will be used to finance the acquisition of Swift, along with $500 million of equity from J&F, and approximately $300 million-$400 million of borrowings on Swift's proposed $700 million asset-based revolving credit facility (unrated), which matures in May 2012. Pro forma for the transaction, rated debt at Swift will be approximately $600 million. Although Swift is being acquired by J&F I Finance, a subsidiary of J&F, Standard & Poor's views JBS and Swift as one economic entity given the common ownership, management, and lines of businesses of the two companies, the consolidation of the Swift brand under one owner, and the willingness of its owners to contribute $500 million of equity to complete this transaction. "We believe that the new owners will face some challenges in acquiring Swift given its very weak performance of the last several years due to mad cow disease, its low margins, the highly competitive operating environment, and the inherent differences of the U.S. market," said Standard & Poor's credit analyst Jayne Ross. The resolution of the CreditWatch will depend on the final acquisition and funding details, including the ultimate capitalization structure at Swift and JBS. The Swift ratings could be raised to 'B+' and equalized with JBS, and JBS' ratings would be affirmed if significant additional equity is contributed to the transaction, for example as a result of the announced commitment to JBS from BNDES Participacoes S.A. for up to R$1.46 billion (approximately $750 million) and a commitment from J&F for up to R$390 million (approximately $200 million). Upon closing of the new financing transaction, Standard & Poor's existing senior unsecured and subordinated debt ratings on Swift will be withdrawn when these notes get repaid. "We will resolve the CreditWatch listings for both Swift and JBS upon closing of the acquisition and completion of the financing," said Ms. Ross. "Any further significant change in financing details could result in a revision of these proposed ratings at both Swift and JBS." JOAN FABRICS: Court Okays Sale of All Assets for $29 Million ------------------------------------------------------------ Joan Fabrics Corp. obtained authority from the U.S. Bankruptcy Court for the District of Delaware to sell its assets for $29 million, Bill Rochelle of Bloomberg News reports. According to Bloomberg, at an auction held June 26, 2007, Valdese Weavers LLC's $13.9 million bid for part of the Debtor's business won. In addition, Bloomberg says Gordon Brothers Group LLC's $9.5 million bid for equipment and Fred J. Godley's $5.9 million offer for options on Cramerton, North Carolina real estate prevailed. Earlier, Kelly Beaudin Stapleton, the United States Trustee for Region 3, opposed the sale of substantially all of the Debtor's assets arguing that the Debtor has not provided sufficient information to interested parties to allow them to evaluate the sales. Moreover, the Trustee said that despite the Debtor's agreement to do so, the Debtor has not addressed issues in the sale motion related to consumer privacy and consumer fraud. GE Commercial Finance Business Property Corporation fka General Electric Capital Business Asset Funding Corporation for its part argued that the Debtor has obligation to GE pursuant to a leased property. The Debtor, through its predecessor, Mastercraft Fabrics LLC, leases a property from Cramerton Associates LLC. The property is located at 345 Eastwood Drive, in Cramerton, North Carolina. Cramerton owes GE $3.7 million pursuant to a promissory note dated July 18, 2002. The note is secured by the leased property. GE contended that the lease property is not part of the estate under Section 541 of the Bankruptcy Code. It is undisputed, GE said, that the property is owned by Cramerton, a non-debtor entity and is leased to the Debtor. GE further argued that it was never contacted by the Debtor regarding the proposed asset sale. Based in Tyngsboro, Massachusetts, Joan Fabrics Corporation manufactures automotive and furniture upholstery fabrics. The company has a manufacturing facility in North Carolina and an affiliate entity in Mexico. The Debtor and its affiliate, Madison Avenue Designs LLC, filed for Chapter 11 protection on April 10, 2007 (Bankr. D. Del. Case Nos. 07-10479 and 07-10480). Curtis A. Hehn, Esq., Laura Davis Jones, Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl Young Jones & Wein represent the Debtors in their restructuring efforts. Bradford J. Sandler, Esq., at Benesch Friedlander Coplan & Aronoff and David A. Matthews, Esq., at Shumaker, Loop & Kendrick, LLP represent the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed estimated assets and debts of $1 million to $100 million. The Debtors' exclusive period to file a plan expires on Aug. 8, 2007. JR HALE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------ Debtor: J.R. Hale Contracting Company, Inc. P.O. Box 25667 Albuquerque, NM 87125 Bankruptcy Case No.: 07-11625 Type of Business: The Debtor is a construction project contractor. Chapter 11 Petition Date: July 5, 2007 Court: District of New Mexico (Albuquerque) Debtor's Counsel: William F. Davis, Esq. William F. Davis & Assoc., P.C. 6709 Academy Northeast, Suite A P.O. Box 6 Albuquerque, NM 87103-0006 Tel: (505) 243-6129 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 ------ --------------- ------------ International Bank $756,000 P.O. Box 1028 Raton, NM 87740 Tom Growney Equipment Equipment Rental $158,655 P.O. Box 6157 Albuquerque, NM 87197 Tax & Revenue Department CRS-1 reports 2004-05 $148,663 P.O. Box 25128 Santa Fe, NM 87504-5128 Firebird Construction Subcontractor $103,300 Services LLC Parking Lot Services of NM Subcontractor $85,065 Internal Revenue Service 941 Taxes for $76,075 Centralized Insolvency 2005-06 Operations Cuddy Kennedy Albetta & Ives Legal Fees $52,648 Ero Ever-Ready Oil Company Vendor $51,447 Vulcan Materials NM Vendor $47,250 Bank of America - MC Credit Card Debt $39,666 Cananwill Inc. Audit - Insurance $33,498 Premium for 2006 Bank of America - MBNA Credit Card Debt $24,380 Calvert-Menicucci Legal Fees $23,482 Aon Risk Services Liability Insurance $23,000 Premium City of Albuquerque Water Meters $20,464 Douglas Seegmiller Law Office Legal Fees $20,000 Contech Construction Products Litigation $18,654 AUI Inc. Equipment Rental $16,496 Dial Oil Company, Inc. Vendor $15,850 Sandoval County Landfill Subcontractor $14,749 KIDS INK: Case Summary & 18 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Kids Ink, Inc. 1933 Longhorn Drive Edmond, OK 73003-6827 Bankruptcy Case No.: 07-12326 Chapter 11 Petition Date: July 5, 2007 Court: Western District of Oklahoma (Oklahoma City) Judge: Richard L. Bohanon Debtor's Counsel: W. Devin Resides, Esq. Resides & Resides, PLLC 615 North Broadway Suite 203 Oklahoma City, OK 73102 Tel: (405) 605-6547 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's List of its 18 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Brenda Hammers Unperfected Mortgage $410,606 1933 Longhorn Drive and Security Interest Edmond, OK 73003-6327 Oklahoma County Treasurer $34,000 320 Robert S. Kerr Oklahoma City, OK 73102 Internal Revenue Service 941 Taxes $30,328 P.O. Box 21126 Philadelphia, PA 19114 Parlee M. Flury $28,114 Denton Law Firm $22,306 Oklahoma Tax Commission $10,000 General Counsel Oklahoma County Treasurer $5,000 U.S. Foods $3,491 Premium Financing Specialists $2,480 Lupercio Lawns $1,277 Kirkpatrick Bank Non-purchase Money $813 Security Winter & Son $416 GE Capital Financial Inc. $321 Dermatec Direct $190 Phillips-Conoco $181 Office Depot $174 AMMEX $124 Shell Fleet $49 MEDICOR LTD: Wants Court Nod on $1.5 Million DIP Financing ---------------------------------------------------------- MediCor Ltd. and its debtor-affiliates ask authority from the U.S. Bankruptcy Court for the District of Delaware to obtain approximately $1.5 million in debtor-in-possession financing from its senior secured lenders. The Debtors' say that the lenders include: * Silver Oak Capital, LLC, * HFTP Investment LLC, * Promethean II Master, L.P., * Promethean I Master Ltd., fka GAIA Offshore Master Fund, * Ltd., and * Portside Growth and Opportunity Fund. Specifically, the Debtors ask the Court to allow them to: a) enter and execute the parties' guarantee and collateral agreement, the DIP notes and orders; b) borrow a principal amount of $1.5 million on a final basis; c) grant the lenders first priority liens and security interests in all present property of the Debtors, and provide adequate protection to the lenders. The Debtors tell the Court that the lenders have also approved their use of the cash collateral. The Debtors contend that immediate access to the cash collateral and DIP loans present the best option for the preservation of their businesses and working capital and liquidity needs. About MediCor Ltd. Headquartered in North Las Vegas, Nevada, MediCor Ltd. -- http://www.medicorltd.com/-- acquires, develops, manufactures and markets products primarily for aesthetic, plastic and reconstructive surgery and dermatology markets. The company and seven of its affiliates filed for chapter 11 protection on June 29, 2007 (Bankr. D. Del. Case No. 07-10877). Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, represents the Debtors. At Sept. 30, 2006, the Debtors' balance sheet showed total assets of $120,354,097, and total debts of $121,439,609. The Debtors' exclusive period to file a chapter 11 plan expires on Oct. 27, 2007. MILA INC: Deteriorating Market Conditions Cue Bankruptcy Filing --------------------------------------------------------------- M.I.L.A. Inc. on July 2, 2007, filed for chapter 11 protection with the U.S. Bankruptcy Court for the Western District of Washington citing deteriorating market conditions and a failed acquisition. The Debtor discloses that prior to its bankruptcy filing, it was a wholesale residential mortgage lender that funded mortgage loans originated by a network of independent mortgage brokers and lenders and submitted to MILA for underwriting and approval. MILA would then sell the funded mortgage loans to the third parties. As of Dec. 31, 2006, MILA operated in 26 states and did business with more than 5,000 approved broker offices and over 12,000 independent loan agents and employed approximately 100 account executives. The company relates that in 2006, short-term interest rates continued to increase over their historic lows from just a year earlier. During the second half of 2006, short-term rates increased further, higher than intermediate and long-term rates. Housing prices also began to stagnate, and even deteriorate in some regions, making it more difficult for troubled borrowers to refinance as a mitigation tool and as a result, investor demand for mortgage loan products fell significantly from the robust levels of 2004 and 2005. These factors also negatively impacted the secondary market, mortgage securities issuers and the rating agencies, the Debtor tells the Court. The mortgage industry experienced steeply discounted prices for subprime and higher risk Alt-A mortgage products, resulting in dramatic revenue losses from the trading and securitization of these products. Poor performance in loans originated in 2004 and 2005 and the changes in the marketability and pricing of these mortgage products in 2006 caused originators to experience dramatic increases in repurchase losses and inadequate reserves for these losses. Issues w/ Warehouse Lenders and Purchasers In December 2006, the Debtor says that unresolved investor repurchase claims exceeded $120 million. MILA also held approximately $70 million in aged, sub-par priced mortgage loans on its two remaining warehouse lending credit facilities that were consequently at risk of curtailment and margin calls. In an effort to continue in business, MILA borrowed $12 million from Columbia Bank in November 2006 and used the proceeds of that loan to effectively settle $118 million of the outstanding investor repurchase claims by the end of December 2006. At that point, MILA began to actively look for a merger or acquisition partner. Notwithstanding the settlement of the repurchase claims, the Debtor continued to face liquidity issues and mounting pressure from its two remaining Warehouse Lenders, RFC and Credit Suisse. The Debtor also defaulted on covenants from these lenders. As the result of these covenant defaults and because of continued repurchase requests from investors in early 2007 -- approximately $60 million -- the Debtor's warehouse lines were first restricted, and ultimately declared in default and closed. Credit Suisse discontinued its line in March 2007 and RFC shut down its line in April 2007. The Failed Acquisition On Feb. 28, 2007, MILA and SG Americas Securities, LLC executed a nondisclosure agreement and SG began to conduct extensive due diligence for the purpose of a possible acquisition of MILA. Unfortunately, due to the mounting financial pressures, MILA was unable to maintain the liquidity necessary to continue in operation, which was critical to the consummation of the SG deal. In an effort to keep negotiations alive, in March 2007 MILA obtained a $2.5 million infusion of equity capital from its CEO and founder, Layne Sapp, which was necessary to keep its last credit facility with RFC active. The Debtor also obtained two operating capital loans from Mr. Sapp totaling $1.25 million during this period, both of which were critical and were used by MILA to continue business operations during the SG due diligence period. On April 18, 2007, SG advised MILA of its decision to terminate further due diligence and not proceed with the acquisition. On April 20, 2007 MILA terminated its sales staff and most of its administrative staff and ceased accepting any new loan submissions. Currently, the Debtor has cooperated with both RFC and Credit Suisse after default in order to mitigate their losses. Both lenders exercised their rights to transition MILA's servicing functions to new servicers. MILA has voluntarily relinquished control of the collateral and provided both lenders with all necessary documentation so that each could work on liquidating the unsold loans on the warehouse line. Presently, there are approximately 43 loans on the CSFB line totaling $7,885,301 and approximately 293 loans on the RFC line for $72,164,139, which are being sold in a commercially reasonably manner. The Debtor says that the proceeds of these sales are being applied to the outstanding balance of the lender's claim, and any deficiency would result in an unsecured claim. About MILA Inc. Based in Mountlake Terrace, Washington, M.I.L.A. Inc., dba Mortgage Investment Lending Associates -- http://www.mila.com/-- is an e-commerce mortgage solutions provider who utilizes AccessPoint, a proprietary e-commerce portal, to help mortgage brokers, realtors and bankers fulfill customized residential home loans. The company filed for Chapter 11 protection on July 2, 2007 (Bankr. W.D. Wash. Case No. 07-13059). Christine M. Tobin, Esq. and James L. Day, Esq., at Bush, Strout, & Kornfeld, represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed total assets of $7,886,962, and total liabilities of $174,730,413. The Debtor's exclusive period to file a chapter 11 plan expires on Oct. 30, 2007. MILA INC: Court Gives Nod on Chapter 11 Trustee Appointment ----------------------------------------------------------- The Hon. Samuel J. Steiner of the U.S. Bankruptcy Court for the Western District of Washington granted M.I.L.A. Inc.'s request to have a chapter 11 trustee appointed in its bankruptcy proceedings. The Debtor contends that appointment of a chapter 11 trustee was appropriate in its case since the recoverable value of the remaining loans it nominally holds is likely substantially less than the claims they secure. The Debtor further contends that a business transaction involving its assets that could be consummated by an industry-experienced trustee to return some value to creditors. The Debtor expects that there will be interest in acquiring its AccessPoint loan origination software and thus appointment of an independent trustee to manage the process would be beneficial. About MILA Inc. Based in Mountlake Terrace, Washington, M.I.L.A. Inc., dba Mortgage Investment Lending Associates -- http://www.mila.com/-- is an e-commerce mortgage solutions provider who utilizes AccessPoint, a proprietary e-commerce portal, to help mortgage brokers, realtors and bankers fulfill customized residential home loans. The company filed for Chapter 11 protection on July 2, 2007 (Bankr. W.D. Wash. Case No. 07-13059). Christine M. Tobin, Esq. and James L. Day, Esq., at Bush, Strout, & Kornfeld, represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed total assets of $7,886,962, and total liabilities of $174,730,413. The Debtor's exclusive period to file a chapter 11 plan expires on Oct. 30, 2007. MOVIE GALLERY: S&P Junks Credit Rating on Covenant Violation ------------------------------------------------------------ Standard & Poor's Ratings Services lowered its corporate credit rating on Movie Gallery Inc. to 'CCC+' from 'B-' based on the announcement that the company was not able to meet its financial covenants for the fiscal quarter ended July 1, 2007, and that the company is exploring available restructuring and strategic alternatives. The outlook is developing. "Movie Gallery remains challenged by poor industry fundamentals," said Standard & Poor's credit analyst David Kuntz, "and sharp declines in its core rental business have exacerbated already-weak operating performance." N-45§ FIRST: Moody's Upgraded Class E Certificates to Ba1 --------------------------------------------------------- Moody's Investors Service upgraded the ratings of four classes and affirmed the ratings of three classes of N-45§ First CMBS Issuer Corporation, Commercial Mortgage-Backed Bonds, Series 2002-1: -- Class A-2, $101,838,097, Fixed, affirmed at Aaa -- Class IO, Notional, affirmed at Aaa -- Class B, $28,520,000, Fixed, upgraded to Aaa from Aa1 -- Class C, $13,421,000, Fixed, upgraded to Aa2 from A1 -- Class D, $10,066,000, Fixed, upgraded to A2 from Baa2 -- Class E, $8,388,000, Fixed, upgraded to Ba1 from Ba2 -- Class F, $5,035,930, Fixed, affirmed at B2 As of the June 15, 2007 distribution date, the transaction's aggregate certificate balance decreased by about 48.9% to $172.3 million from $335.5 million at securitization. The certificates are collateralized by 11 mortgage loans secured by commercial and multifamily properties. The loans range in size from 1.3% to 25.6% of the pool balance with the top three loans representing 64.7%. The pool has not realized any losses since securitization and no loans are on the master servicer's watchlist or in special servicing. Moody's loan to value ratio is 59.5%, compared to 76.8% at securitization. Moody's is upgrading Classes B, C, D and E due to improved pool performance and increased subordination levels. The largest loan is the Royal Bank Building Loan ($44.2 million -- 25.6%), which is secured by a 313,000 square foot Class A office building located in Toronto, Ontario. The property is 95% occupied, compared to 99% at securitization. The largest tenants are the Government of Canada (64% NRA; lease expiration April 2012) and Royal Bank of Canada (13%; lease expiration August 2011; Moody's senior unsecured rating Aaa -- stable outlook). Moody's does not anticipate any near term credit issues due to the stable tenancy. The balloon LTV at maturity on July 1, 2011 is anticipated to be about 85.8%. The loan is recourse to the principal of the borrower. The second largest loan is the Maison Trust Royal Loan ($38.5 million -- 22.3%), which is secured by a 638,000 square foot Class A office building located in the financial district of Montreal, Quebec. The property is 91% occupied, compared to 77.4% at securitization. The largest tenant is the Royal Bank of Canada (16.0% NRA; lease expiration January 2010). Moody's LTV is 44.5%, compared to 65% at securitization. The third largest loan is the Galeries de Granby Loan ($29 million -- 16.8%), which is secured by a 512,000 square foot community shopping center located in Granby, Quebec. The center is 100% occupied, compared to 99% at securitization. Anchors include Wal-Mart (25% GLA; lease expiration May 2020; Moody's senior unsecured rating Aa2 -- stable outlook) and Sears Canada Inc. (23%; lease expiration November 2019; Moody's long-term issuer rating Ba2 -- stable outlook). Moody's LTV is 53.4%, compared to 60.7% at securitization. NORTHWEST AIRLINES: Sells ARINC Stake to Carlyle ------------------------------------------------ Northwest Airlines Corp., along with five other airlines, entered into a Stock Purchase Agreement selling their stake in ARINC Inc. to Radio Acquisition Corp., an affiliate of the Carlyle Group, the Wall Street Journal reports. The five other airlines are: * AMR Corp.'s American Airlines Inc., * UAL Corp.'s United Air Lines Inc., * Continental Airlines Inc., * Delta Air Lines Inc. and * US Airways Group Inc. According to the report, the airlines, who holds over 90% of ARINC shares, expects to gain around $1 billion. The sale is expected to close before Oct. 31, 2007. AMR said that it expects to receive $194 million from the sale while UAL said it expect to get $125 million. WSJ relates that the airlines declined to comment further on the deal. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. - http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. * * * As reported in the Troubled Company Reporter on June 4, 2007, Standard & Poor's Ratings Services raised its ratings on Northwest Airlines Corp. and its Northwest Airlines Inc. subsidiary, including raising the long-term corporate credit ratings on both entities to 'B+' from 'D', following their emergence from Chapter 11 bankruptcy proceedings. The rating outlook is stable. NORTHWEST AIRLINES: Distributes Cash and 401(K) Contributions ------------------------------------------------------------- Northwest Airlines, on behalf of the Association of Flight Attendants-CWA, has distributed cash and 401(K) contributions generated from the sale of the $182 million unsecured claim included in the union's recently approved labor contract. This allocation of funds to Northwest's flight attendants completes the sale of all contract employee unsecured claims negotiated during the carrier's Chapter 11 restructuring. These unsecured claims totaled $1.25 billion. Commencing in February 2007 when the company unilaterally gave its unions the right to sell a portion of their claims earlier than their collective bargaining agreements otherwise permitted, each of the unions has been monetizing its claim dollars. In the aggregate, the total dollar amount in cash and Northwest stock to be distributed to contract employees is $960 million. "When we originally negotiated the claims, the expected sale price was 15 cents on the dollar. If that price had stayed, the total claims distribution would have been $180 million. Instead, as a result of our successful restructuring, those unsecured claims are worth $960 million, a $780 million improvement over what was expected," said Doug Steenland, Northwest Airlines president and chief executive officer. Incentive Plans Offer More The claims are in addition to a separate gain sharing program also included in the new labor contracts that could see contract employees and non-executive salaried staff receive an additional $500 million in profit sharing through the end of 2010. About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. * * * As reported in the Troubled Company Reporter on June 4, 2007, Standard & Poor's Ratings Services raised its ratings on Northwest Airlines Corp. and its Northwest Airlines Inc. subsidiary, including raising the long-term corporate credit ratings on both entities to 'B+' from 'D', following their emergence from Chapter 11 bankruptcy proceedings. The rating outlook is stable. NOVELIS INC: $841,000 of Senior Notes Tendered ---------------------------------------------- Novelis Inc. has received $841,000 aggregate principal amount of senior notes validly tendered, pursuant to the change of control offer, relating to its $1.4 billion principal amount of 7-1/4% Senior Notes due 2015. The change of control offer expired at 5:00 p.m., New York City time on July 3, 2007. All holders that validly tendered senior notes pursuant to the change of control will receive the offer consideration of $1,010 per $1,000 principal amount of senior notes tendered. The settlement date for senior notes validly tendered pursuant to the change of control offer was on July 6, 2007. Based in Atlanta, Georgia, Novelis Inc., (NYSE: NVL) (TSX: NVL) -- http://www.novelis.com/-- is the global provider of aluminum rolled products and aluminum can recycling. The company operates in 11 countries and has approximately 12,900 employees. Novelis has the capability to provide its customers with a regional supply of technologically sophisticated rolled aluminum products throughout Asia, Europe, North America and South America. Through its advanced production capabilities, the company supplies aluminum sheet and foil to the automotive and transportation, beverage and food packaging, construction and industrial, and printing markets. Novelis is a subsidiary of Hindalco Industries Limited, an integrated producer of aluminum and copper. Hindalco is the flagship company of the Aditya Birla Group, a multinational conglomerate based in Mumbai, India. * * * As reported in the Troubled Company Reporter on June 25, 2007, Standard & Poor's Ratings Services assigned its 'BB' debt rating, with a recovery rating of '2', to Novelis Inc.'s $860 million secured term loan due 2014. NYLSTAR INC: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Nylstar, Inc. 420 Industrial Park Drive Ridgeway, VA 24148 Bankruptcy Case No.: 07-61227 Type of business: The Debtor manufactures nylon fibers. See http://www.nylstar.com/ Chapter 11 Petition Date: July 5, 2007 Court: Western District of Virginia (Lynchburg) Judge: William E. Anderson Debtor's Counsel: Richard C. Maxwell, Esq. Woods, Rogers & Hazlegrove, P.L.C. P.O. Box 14125 Roanoke, VA 24038 Tel: (540) 983-7628 Estimated Assets: $50 Million to $100 Million Estimated Debts: $50 Million to $100 Million The Debtor did not file a list of its 20 largest unsecured creditors. OPTI CANADA: Completes $750 Million Financing --------------------------------------------- OPTI Canada Inc.'s debt financing was placed with institutional investors. The financing includes $750 million of 7.875% senior secured notes due 2014. "With the completion of this financing, OPTI has put in place a capital structure to fund Phase 1 to completion, well as to support our Phase 2 planning activities in advance of potential sanctioning in 2008," Sid Dykstra, president and chief executive officer of OPTI, said. "The success of this financing is a reflection of the proximity to start-up of our first phase at Long Lake, our next-generation upgrading process, and our large resource base which will allow us to proceed with our phased development plan to achieve our target of 180,000 barrels per day of Premium Sweet Crude net to OPTI." Mr. Dykstra added. Upon closing of this transaction, OPTI realized net proceeds from the senior notes of approximately $260 million after repayment of OPTI's $450 million Term Loan B Facility, funding of an interest reserve account and deduction for expenses. Total long-term debt outstanding is $1.750 billion, consisting of the $750 million 7.875% senior secured notes and issued $1 billion 8.25% senior secured notes. OPTI also has access to a CDN$500 million revolving credit facility, of which CDN$424 million is currently undrawn. Credit Suisse acted as book-running lead manager, with RBC Capital Markets and TD Securities acting as joint lead managers. The syndicate also included RBS Greenwich Capital, BNP Paribas, Merrill Lynch, Scotia Capital and Societe Generale. About OPTI Canada Inc. Headquartered in Calgary, Alberta, OPTI Canada Inc. (TSE: OPC) is a company focused on developing the fourth and next major integrated oil sands project in Canada, the Long Lake Project, in a 50/50 joint venture with Nexen Inc. * * * As reported in the Troubled Company Reporter June 28, 2007, Standard & Poor's Ratings Services lowered its long-term corporate credit rating OPTI Canada Inc. to 'BB-' from 'BB' because of increased debt levels and expected weak coverage metrics. The outlook is stable. PACIFIC LUMBER: Bank of NY Wants KPMG's Fees Paid by Estate Funds ----------------------------------------------------------------- The Bank of New York Company, N.A. tells the United States Bankruptcy Court for the Southern District of Texas that it does not object to Scotia Pacific Company LLC's engagement of KPMG LLP as its timber valuation consultant, effective May 15, 2007, for as long as Scopac agrees that the fees and expenses of the independent valuation consultants engaged by the Indenture Trustee will be paid out of the estate funds. In addition, BoNY asks the Court to require Scopac to clarify the objections raised by the Official Committee of Unsecured Creditors regarding: (a) KPMG's experience or qualification as a timber valuation Consultant; and (b) the identity, experience, qualifications or compensation structure for the various subcontractors that KPMG apparently intends to consult with to perform the actual timber valuation. BoNY also asks the Court to address the issues regarding certain provisions in the KPMG Engagement Letter that: (1) permits Scopac to spend substantial amounts of cash collateral paying KPMG for valuation opinions that Scopac can shield from disclosure simply by not designating KPMG as a testifying expert; (2) permits KPMG to hire its own independent counsel at the expense of the estate; (3) provides for alternative dispute resolution; and (4) seeks to limit review of KPMG's fees to the standard under Section 328(a) of the Bankruptcy Code rather than the appropriate standard of review under Section 330. Scopac Talks Back "KPMG is qualified to provide timber valuation services," Kathryn A. Coleman, Esq., at Gibson, Dunn & Crutcher LLP, in New York, asserts. Ms. Coleman relates that the principal individuals composing KPMG are specialized commercial real estate valuations, and have experience in valuations of timberlands, raw land, and rural- ranch lands. James R. Yerges, principal in the Economic and Valuation Services Department under the Tax Department of KPMG, represents that his firm has diverse experience and extensive knowledge in the fields of accounting, taxation, risk advisory services, valuation services and bankruptcy. Mr. Yerges represents that he holds at least 26 years of appraisal and valuation experience, and has performed valuations for purposes of fairness opinions, mergers and acquisition, purchase price allocation, insurance ad valorem taxation, asset- based financing, bankruptcy, and estate planning. Another KPMG principal, Sam Romanaggi, manager in the Economic and Valuation Services Group of KPMG, specializes in commercial real estate valuations and consulting for financial reporting, merger and acquisition, divestitures and various compliance matters. In further support of its response, Scopac presents the qualifications and compensation structure of three subcontracting consultants, which will work with KPMG in connection with the timber valuation services: 1. Kim Iles & Associates, Ltd. Kimberly Iles, Ph.D., a principal of Iles & Associates, relates that her firm specializes in statistics and forest inventory design, proportional probability, sampling systems and timber cruising methods, growth and yield, sample scaling, and expert witness consultation in legal cases. As Subcontracting Consultant, Iles & Associates will: * provide a statistically valid assessment of the accuracy of Scopac's standing inventory; * conduct field sampling and detailed review of Scopac's existing timber inventory maps and databases; and * issue a final joint report with KPMG and the Subcontracting Consultants, and provide expert witness testimony in connection with the report. Scopac agrees to pay Iles & Associates $100 per hour for professional services rendered. Ms. Iles relates that in 2002 and 2003, Iles & Associates was hired to review Scopac's 2001 inventory. In addition, the firm was consulted for assistance with various small timber inventory and statistical projects. 2. DR Systems Northwest, Inc. Don R. Reimer, Ph.D., principal of the DR Systems, relates that the firm specializes in resource economics, biometrics, strategic resource management planning and policy analysis, with special emphasis on long-term resource supply, biodiversity and sustainable development issues, investment or risk analysis, resource inventory and monitoring systems design and implementation. DR Systems will provide: * expert opinion on the growth and yield of Scopac's Forests; * resource economics of Scopac's Timberlands; * long-term sustainable harvest calculations; * evaluation of forest resources; and * verification of Scopac's GIS-based decision support systems. Scopac will pay DR Systems based on the firm's hourly rates: Professional Hourly Rate ------------ ----------- Don Reimer $250 Other professionals $200 Administrative and technical staff $75 - $100 3. Environmental Resource Solutions, Inc. John W. Williams, principal of ERS, relates that the firm specializes in forestry and forest-related services, including natural resource studies, aerial photo interpretation, orthophoto creation, resource mapping, vegetation and tree inventory, timber and timberland management and its appraisals. In connection with its subcontracting work with KPMG, ERS will work with: * Ms. Iles to validate the timber inventory on the lands of Scopac; * Mr. Reimer to provide knowledge and insight on the California Timber Harvesting plans on Scopac's lands. Messrs. Reimer and Williams and Ms. Iles assure the Court that their firm do not hold or represent any interest adverse to Scopac, and is a "disinterested person" as that term is defined under Section 101(14) of the Bankruptcy Code. Specifically, Scopac seeks to hire KPMG to provide valuations for its 204,000 acres of timberland and its exclusive rights to harvest timber on 12,000 additional acres of timberland owned by Pacific Lumber Company and its affiliates. Those valuations are crucial to facilitate negotiations among Scopac, its creditors, and proposed lenders and investors, Kathryn A. Coleman, Esq., at Gibson, Dunn & Crutcher LLP, in New York, told the Court. As Scopac's consultant, KPMG will provide an expert opinion of the fair market value of Scopac's timber and timberlands, and perform other tasks as may be identified during the course of its engagement. KPMG will also work with other forest industry experts that have been identified as experts in the field of timber inventories, timber growth, harvest plans and timber cutting yields. In addition, KPMG will review and update information received, and will issue a final joint expert report, and may provide expert witness testimony in connection with the report. Scopac will pay for KPMG's services based on the firm's current hourly rates: Professional Hourly Rates ------------ ------------ Partner/Managing Director $800 Manager $550 Senior Associate $350 Associate $250 James R. Yerges, a principal in KPMG's Economic and Valuation Department, assured the Court that his firm does not hold or represent any interest adverse to Scopac's estate, and is thus deemed a "disinterested person" as that term is defined under Section 101(14) of the Bankruptcy Code. About Pacific Lumber Headquartered in Oakland, California, The Pacific Lumber Company -- http://www.palco.com/-- and its subsidiaries operate in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032). Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. John F. Higgins, Esq., and James Matthew Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co- counsel. When Pacific Lumber filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. Scotia Pacific listed total assets of $932,000,000 and total debts of $765,978,335. The Debtors' exclusive period to file a chapter 11 plan expires on Sept. 18, 2007, as extended. The Debtors' exclusive period to solicit acceptances of that plan expires on Nov. 19, 2007. (Scotia/Pacific Lumber Bankruptcy News, Issue No. 20, http://bankrupt.com/newsstand/or 215/945-7000). PACIFIC LUMBER: May Employ Baker Botts as Bankruptcy Counsel ------------------------------------------------------------ The United States Bankruptcy for the Southern District of Texas has granted permission to Pacific Lumber Company and its debtor- affiliates to employ Baker Botts LLP as their bankruptcy counsel effective as of May 9, 2007, pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code. Gary Clark, vice president and chief financial debtor of Pacific Lumber Company, related that in light of the resolution of the venue dispute in the Debtors' cases and in an effort to maximize efficiencies and lower costs, the Debtors have decided to transition their bankruptcy representation from the law firm of Howard Rice Nemerovski Canady Falk & Rabkin P.C., to Baker Botts. Jordan, Hyden, Womble, Culbreth & Holzer, P.C. will continue to represent the Debtors as co-counsel to Baker Botts, Mr. Clark stated. The Debtors selected Baker Botts due to the firm's extensive experience, knowledge and established reputation in corporate reorganizations and debt restructuring, according to Mr. Clark. As the Debtors' counsel, Baker Botts is expected to: (a) assist in exploring restructuring alternatives and developing a reorganization strategy; (b) develop, negotiate, and promulgate a Chapter 11 plan of reorganization and prepare a related disclosure statement; (c) advise the Debtors with respect to their rights and obligations as debtors-in-possession and other areas of bankruptcy law; (d) take all necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on the Debtors' behalf, the defense of any actions commenced against the Debtors, negotiations concerning all litigation in which the Debtors are involved, and the filing and prosecution of objections to claims filed against the Debtors' estates; (e) prepare all necessary applications, motions, answers, orders, briefs, reports and other papers in connection with the administration of the Debtors' estates; (f) represent the Debtors at all hearings and proceedings; (g) perform all other necessary legal services in connection with these Chapter 11 cases; and (h) rendering general, non-bankruptcy legal services, including, without limitation, environmental, corporate, real estate, litigation, tax, labor relations, and employee benefits matters. Baker Botts and Howard Rice will work together during the transition period to minimize costs and avoid duplication of efforts. Certain matters, however, will not be transitioned if it would not enhance efficiencies. Accordingly, those matters may instead remain with Howard Rice, Mr. Clark notes. For instance, the Debtors expect to continue to retain Howard Rice in connection with the negotiation and documentation of a DIP credit facility, and the use of cash collateral pending the closing of the DIP loan. To further minimize the cost of transition, Baker Botts has agreed to provide 60 hours of transition at no cost to the Debtors. The Debtors will pay for Baker Botts' services based on the firm's current standard hourly rates: Professional Hourly Rate ------------ ----------- Partners and Counsel $400 - $725 Associates $190 - $395 Paralegals $120 - $200 Paralegal Clerks $50 - $105 Jack L. Kinzie, Esq., the partner-in-charge of the firm's Dallas office, attested that Baker Botts does not represent any adverse interest to the Debtors, and is a "disinterested person" as defined under Section 101(14) of the Bankruptcy Code. Mr. Kinzie recognized that there may be potential conflicts inherent in the firm's concurrent representation of the Debtors, taking into consideration the Debtors' intertwined business operations and relationships with one another. In addition, conflicts may arise as a result of The Pacific Lumber Company's intercompany debt owed to Britt Lumber Co., Inc. Mr. Kinzie, however, believes that these potential conflicts are non-material for practical purposes. "Baker Botts' joint representation of the [Debtors] will be limited to those matters in which the [Debtors'] interests are aligned on all material issues," Mr. Kinzie assured the Court. In the event that the Debtors' interests should become materially adverse with respect to any issue, Baker Botts will recommend to the Debtors that one or more of them retain separate counsel with respect to that issue, Mr. Kinzie added. About Pacific Lumber Headquartered in Oakland, California, The Pacific Lumber Company -- http://www.palco.com/-- and its subsidiaries operate in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032). Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. John F. Higgins, Esq., and James Matthew Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co- counsel. When Pacific Lumber filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. Scotia Pacific listed total assets of $932,000,000 and total debts of $765,978,335. The Debtors' exclusive period to file a chapter 11 plan expires on Sept. 18, 2007, as extended. The Debtors' exclusive period to solicit acceptances of that plan expires on Nov. 19, 2007. (Scotia/Pacific Lumber Bankruptcy News, Issue No. 20, http://bankrupt.com/newsstand/or 215/945-7000). PENINSULA GAMING: S&P Lifts Corporate Credit Rating to B+ from B ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Peninsula Gaming LLC to 'B+' from 'B'. The rating was removed from CreditWatch, where it was placed with positive implications on May 23, 2007. The outlook is stable. In addition, Standard & Poor's raised its issue-level rating on Peninsula Gaming's $255 million 8.75% senior secured notes due 2012 to 'B+' from 'B'. This rating was also removed from CreditWatch. Also, S&P assigned a recovery rating of '3' to the notes, indicating that lenders can expect meaningful (50% to 70%) recovery in the event of a payment default. "The rating upgrade reflects improved credit measures stemming, in large part, from the ramp-up of the company's new Diamond Jo Worth property," said Standard & Poor's credit analyst Ariel Silverberg. "In addition, we believe that credit measures will remain at a level consistent with the new rating, despite expected higher capital spending levels associated with development of an improved Diamond Jo Dubuque property. Although performance at Evangeline Downs has dropped off since the period of reduced competition following the 2005 hurricanes, S&P expect the property to perform at a normalized, pre-hurricane rate now that capacity has reentered the Gulf Coast gaming market." Recent positive operating performance, primarily as a result of the success of the Worth property, has led to a strengthening of credit measures, with adjusted debt leverage falling to 5.3x at March 31, 2007, from 6.6x at March 31, 2006. Peninsula's liquidity profile continues to strengthen with solid levels of free operating cash flow generation, $29 million for the 12 months ended March 31, 2007. Combined with surplus cash on hand, the liquidity is expected to cover a significant portion of the costs of the new Dubuque facility. S&P expect incremental borrowings associated with this facility to be in the $20 million to $30 million range. In addition, any increase in leverage is expected to be temporary, given the return Peninsula is likely to generate on this investment. RADNET MANAGEMENT: Moody's Lifts Corporate Family Rating to B2 -------------------------------------------------------------- Moody's upgraded the corporate family rating of RadNet Management, Inc, a subsidiary of RadNet, Inc. to B2 from B3 and assigned a rating of B2 to the proposed first lien credit facilities consisting of a $45 million senior secured first lien revolving credit facility and a $400 million senior secured first lien term loan B. Concurrently, Moody's affirmed a speculative grade liquidity rating of SGL-2 and the Probability of Default Rating at B3. The outlook has been changed to stable from positive. Proceeds derived from the new credit facilities will be utilized to refinance existing indebtedness, fund future acquisitions, provide future working capital and liquidity needs and pay transaction fees and expenses. These ratings have been upgraded: -- Corporate Family Rating, to B2 from B3 This summarizes the ratings assigned: -- $45 million senior secured first lien revolving credit facility due 2013, rated B2 (LGD3, 33%) -- $400 million senior secured first lien term loan due 2014, rated B2 (LGD3, 33%) These ratings have been affirmed: -- Speculative Grade Liquidity Rating, SGL-2 -- Probability of Default rating, B3 The ratings on the existing facilities are being prospectively withdrawn. The upgrade in the Corporate Family Rating to B2 from B3 primarily reflects favorable operating results and stable credit metrics generally consistent with a B2 rating exhibited on a post- acquisition basis with Radiologix and under the full effects of the Medicare reimbursement cuts as mandated by the Deficit Reduction Act. The upgrade also reflects material cost savings realized to-date as a result of the merger with Radiologix, a stronger, more diversified footprint together with continued, sound liquidity. The SGL-2 rating reflects a good liquidity profile. The expectation is that the company will continue to fund all working capital and capital expenditures from operating cash flow. External liquidity will be provided by a $45 million revolver that will be drawn only modestly at the close of the refinancing. Moody's anticipates that the company will utilize the revolver from time to time to fund opportunistic, tuck-in acquisitions in the diagnostic imaging space. The stable outlook reflects Moody's expectation that the company will continue to grow revenues and cash flow through the expansion of procedure volume and the number of scan modalities offered at its sites as well as through numerous, small opportunistic acquisitions of imaging centers from competitors in a reasonably disciplined manner. Downward pressure on the ratings or outlook could develop if expansion plans become too aggressive, or if the company starts to encounter integration problems as a consequence of its multi- pronged expansion program, resulting in an erosion of margins and cash flow with a reduction in adjusted free cash flow to debt below roughly 2% on a sustained basis. The ratings could also be downgraded if the ratio of adjusted total debt to EBITDA increases above 6.5 times. The ratings or outlook could improve in the event that the company's site development and acquisition program continues to be well executed, resulting in the enhanced density of operations and profitability of existing sites, translating into an improvement in adjusted free cash flow to debt to a level of 5% or better or to a ratio of adjusted debt to EBITDA below 4.3 times on a sustained basis. RadNet provides diagnostic imaging services through a network of 132 fixed-site, free-standing outpatient imaging centers, consisting of 95 multi-modality and 37 single-modality facilities, primarily in the states of California, Maryland and New York. For the twelve months ended March 31, 2007, the company recognized revenue of about $390 million. RADNET MANAGEMENT: S&P Rates $445 Million Secured Facility at B --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its bank loan and recovery ratings to RadNet Management Inc.'s $445 million secured bank facility. The facility has been rated 'B', the same as the company's corporate credit rating. This, and a recovery rating of '3' indicate the expectation for meaningful recovery (50%-70%) in the event of a default. At the same time, the outlook is revised to positive from stable. This action reflects the implementation of cost cuts to mitigate the impact of reimbursement reductions, continued organic growth, and disciplined expansion. Furthermore, leverage has declined from prior years despite the incremental debt added with the proposed financing transaction. "Our expectations are that modest organic growth (about 3%) will continue," said Standard & Poor's credit analyst Cheryl E. Richer, "and that acquisition activity, even if debt-financed, will be managed in a manner that sustains debt leverage no higher than 4.5x-annualized for acquisitions." RAG SHOPS: Court OKs Rosen Slome as General Bankruptcy Counsel -------------------------------------------------------------- Rag Shops Inc. and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Eastern District of New York to employ Hunter Rosen Slome Marder, L.L.P. as general bankruptcy counsel. Rosen Slome is expected to: a) take all necessary action to protect and preserve the estates of the Debtors, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtors, the negotiation of disputes in which the Debtors are involved, and the preparation of objections to claims filed against the Debtor's estates; b) prepare on behalf of the Debtors, as debtors in possession, all necessary motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtor's estates; c) negotiate and prepare on behalf of the Debtors a plan of reorganization or liquidation and all related documents; and d) perform all other necessary legal services in connection with the prosecution of these chapter 11 cases. Adam L. Rosen, Esq., a partner at Rosen Slome, tells the Court the firm's professional bill: Designation Hourly Rate ----------- ----------- Partners $300 - $395 Associates and Counsel $185 - $285 Paralegals $100 Mr. Rosen tells the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the U.S. Bankruptcy Code. Mr. Rosen can be contacted at: Adam L. Rosen, Esq. Rosen Slome Marder, L.L.P. 333 Earle Ovington Boulevard, Suite 901 Uniondale, NY 11553-3622 Tel: (516) 227-1600 Fax: (516) 227-1601 http://www.rsmllp.com/ About Rag Shops Rag Shops operated 60-plus stores offering value-priced crafts, fabrics, and related merchandise. Founded in 1963 Rag Shops had expanded the business by moving into markets adjacent to established operations. Rag Shops had stores in Connecticut, Florida, New Jersey, New York, and Pennsylvania. Rag Shops was acquired by an affiliate of Sun Capital for $11.5 million in late- 2004. The company and its affiliates filed for chapter 11 protection on May 2, 2007 (Bankr. E.D.N.Y. Lead Case No. 07-42272). At March 3, 2007, the company disclosed total assets of $35,301,000 and total debts of $52,532,000. RAG SHOPS: U.S. Trustee Appoints Five-Member Creditors' Committee ----------------------------------------------------------------- Diana G. Adams, the acting U.S. Trustee for Region 2, appointed five members to serve on an Official Committee of Unsecured Creditors in Rag Shops Inc. and its debtor-affiliates' Chapter 11 cases: 1. Li & Fung (Trading), Ltd. c/o Li & Fung 1359 Broadway, 16th Floor New York, NY 10018 2. Notions Marketing 1500 Buchanan, Southwest Grand Rapids, MI 49507 3. Joan Baker Designs, Inc. 1130 Via Callejon San Clemente, CA 92673 4. Regency International 11 East 26th Street New York, NY 10010 5. M.C.S. Industries 2280 Newlins Mill Road Easton, PA 18045 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About Rag Shops Rag Shops operated 60-plus stores offering value-priced crafts, fabrics, and related merchandise. Founded in 1963 Rag Shops had expanded the business by moving into markets adjacent to established operations. Rag Shops had stores in Connecticut, Florida, New Jersey, New York, and Pennsylvania. Rag Shops was acquired by an affiliate of Sun Capital for $11.5 million in late- 2004. The company and its affiliates filed for chapter 11 protection on May 2, 2007 (Bankr. E.D.N.Y. Lead Case No. 07-42272). At March 3, 2007, the company disclosed total assets of $35,301,000 and total debts of $52,532,000. RF MICRO: Registers Resale of $375 Million Convertible Notes ------------------------------------------------------------ RF Micro Devices Inc. has filed a registration statement on Form S-3 with the Securities and Exchange Commission in relation to the resale by the holders of RFMD's $200,000,000 aggregate principal amount of 0.75% Convertible Subordinated Notes due 2012 and $175,000,000 aggregate principal amount of 1% Convertible Subordinated Notes due 2014 and the shares of RFMD's common stock, no par value per share, issuable upon conversion of the notes. RFMD issued and sold the notes in April 2007 in a private placement pursuant to Rule 144A of the Securities Act of 1933, as amended. The registration statement was filed in satisfaction of RFMD's obligations under a registration rights agreement entered into in connection with the April 2007 private placement of the notes. Because RFMD is a "well-known seasoned issuer," the registration statement was automatically effective upon filing with the SEC. Headquartered in Greensboro, North Carolina, RF Micro Devices, Inc. (Nasdaq: RFMD) -- http://www.rfmd.com/-- designs and manufactures radio systems and solutions for mobile communication applications. * * * Standard and Poor's rated B+ RF Micro Devices' long term foreign and local issuer credit effective October 2003. RITCHIE (IRELAND): Court Gives Interim Nod on LeBoeuf as Counsel ---------------------------------------------------------------- The Hon. Burton R. Lifland of the U.S. Bankruptcy Court for the Southern District of New York gave his interim approval for Ritchie Risk-Linked Strategies Trading (Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading (Ireland) II Ltd. to employ LeBoeuf, Lamb, Greene & MacRae LLP as their general counsel. As reported in the Troubled Company Reporter on June 28, 2007, LeBoeuf Lamb is expected to: (a) advise the Debtors with respect to their powers and duties as debtors-in-possession in the continued operation of their businesses; (b) advise the Debtors with respect to all general bankruptcy matters; (c) prepare on behalf of the Debtors all necessary applications, answers, orders, reports, and papers in connection with the administration of their estates; (d) represent the Debtors at all critical hearings on matters relating to their affairs and interests as debtors-in- possession before this Court, any federal or state courts or administrative panels, any appellate courts, the United States Supreme Court, and protecting the interests of the Debtors; (e) prosecute and defending litigated matters that may arise during these cases, including such matters as may be necessary for the protection of the Debtors' rights, the preservation of estate assets, or the Debtors' successful reorganization; (f) prepare and file the disclosure statement and negotiate, present and implement a plan of reorganization; (g) negotiate appropriate transactions and preparing any necessary related documentation; (h) advise, assist and negotiate the sale of all or part of the Debtors' assets pursuant to Section 363 of the Bankruptcy Code or a chapter 11 plan of reorganization; (i) represent the Debtors on matters relating to the assumption or rejection of executory contracts and unexpired leases; (j) advise the Debtors with respect to corporate, securities, real estate, litigation, labor, finance, insurance, regulatory, tax, healthcare and other legal matters which may arise during the pendency of these cases; and (k) perform all other legal services that are necessary for the efficient and economic administration of these cases. The Debtors will pay the LLGM based on these hourly rates: Professional Designation Hourly Rate ------------ ----------- ----------- Lewis Rosenbloom, Esq. Partner $750 Peter Ivanick, Esq. Partner $750 David Cleary, Esq. Partner $650 Maria Dantas, Esq. Partner $650 Dean Gramlich, Esq. Counsel $550 Mohsin Khambati, Esq. Counsel $550 Allison Weiss, Esq. Counsel $550 Thomas Augspurger, Esq. Associate $495 Sarah Trum, Esq. Associate $445 June Kim, Esq. Associate $395 Sandy Holstrom Paralegal $260 Amelie de Richemont Paralegal $170 About May 21, 2007, LLGM received an advance payment retainer totaling $450,000. On June 20, 2007, LLGM submitted an invoice and was paid for professional fees and expenses incurred for periods through June 20, 2007, in the sum of $91,196. After deduction of the $91,196 from the $450,000 advance payment, there is the sum of $358,804 remaining. The Debtors and LLGM have agreed that the $358,804 retainer will be held and applied against LLGM's final post-petition billings and will not be placed in a separate account. The Debtors and LLGM agree that all services provided by LLGM will be allocated by LLGM and paid by the Debtors in these manner: Ritchie I will be responsible for 84.6% and Ritchie II for 15.4% of the joint invoice. To the best of the Debtors' knowledge, LLGM neither represents nor holds any interest adverse to the interests of the estates or any class of creditors or equity security holders. The firm can be reached at: Allison H. Weiss, Esq. Peter A. Ivanick, Esq. LeBoeuf, Lamb, Greene & MacRae LLP 125 West 55th Street New York, NY 10019 Telephone: (212) 424-8000 Facsimile: (212) 424-8500 http://www.llgm.com/ Based in Dublin, Ireland, Ritchie Risk-Linked Strategies Trading (Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading (Ireland) II Ltd. -- http://www.ritchiecapital.com/-- are Dublin- based funds of hedge fund group Ritchie Capital Management. The Debtors were formed as special purpose vehicles to invest in life insurance policies in the life settlement market. The Debtors filed for Chapter 11 protection on June 20, 2007 (Bankr. S.D.N.Y. Case Nos. 07-11906 and 07-11907). When the Debtors filed for bankruptcy, they listed estimated assets and debts of more than $100 million. The Debtors' exclusive period to file a Chapter 11 plan expires on Oct. 18, 2007. RITCHIE (IRELAND): Gets Interim Nod on Matheson as Irish Counsel ---------------------------------------------------------------- The Hon. Burton R. Lifland of the U.S. Bankruptcy Court for the Southern District of New York gave his interim approval for Ritchie Risk-Linked Strategies Trading (Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading (Ireland) II Ltd. to employ Matheson Ormsby Prentice, Solicitors, as its Irish counsel As reported in the Troubled Company Reporter on July 3, 2007, the Debtors expect Matheson Ormsby to assist them in executing their duties as debtors-in-possession and in implementing the reorganization of the Debtors' affairs with respect to matters of Irish Law. The Debtors agreed to pay the firm's professionals at these hourly rates: Tony O'Grady EUR485 Julie Murphy-O'Connor EUR425 Libby Garvey EUR485 Anthony Walsh EUR550 William Flynn EUR485 Aidan O'Connell EUR225 Prior to their bankruptcy filing, the Debtors paid Matheson Ormsby a total of EUR118,158 for services rendered and costs incurred. The Debtors also paid Matheson Ormsby a EUR20,000 retainer. To the best of the Debtors' knowledge, the firm neither represents nor holds any interest materially adverse to the estate or any party-in-interest and is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Based in Dublin, Ireland, Ritchie Risk-Linked Strategies Trading (Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading (Ireland) II Ltd. -- http://www.ritchiecapital.com/-- are Dublin- based funds of hedge fund group Ritchie Capital Management. The Debtors were formed as special purpose vehicles to invest in life insurance policies in the life settlement market. The Debtors filed for Chapter 11 protection on June 20, 2007 (Bankr. S.D.N.Y. Case Nos. 07-11906 and 07-11907). When the Debtors filed for bankruptcy, they listed estimated assets and debts of more than $100 million. The Debtors' exclusive period to file a Chapter 11 plan expires on Oct. 18, 2007. RJ GATORS: Wants to Access Wachovia Cash Collateral --------------------------------------------------- R.J. Gators Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Florida to use the cash collateral securing repayment of their obligation to Wachovia Bank NA. Wachovia is a secured lender asserting a total of $1,443,617 in secured claims. The Debtors say they will use the cash collateral to operate their business, based on a Court-approved budget. The Debtors also seek authority to deviate from the budget by 10%. As adequate protection, the Debtors grant Wachovia replacement liens and the maintenance of existing Collateral levels. The Court is set to consider approval of the Debtors' request at a July 19, 2007 hearing. Headquartered in Jupiter, Florida, R.J. Gators Inc. -- http://www.rjgators.com/-- owns and operates casual dining restaurants. The company and nine affiliates filed for chapter 11 protection on June 26, 2007 (Bankr. S.D. Fla. Case Nos. 07-14954 to 07-14693). Bradley S. Shraiberg, Esq. at Kluger, Peretz, Kaplan & Berlin, P.L. represents the Debtors in their restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in this case to date. When the Debtors filed for bankruptcy, they listed assets and debts between $1 million to $100 million. The Debtors' exclusive period to file a chapter 11 plan of reorganization expires on Oct. 24, 2007. ROBBINSDALE APARTMENTS: Case Summary & 3 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Robbinsdale Apartments Housing Associates I, L.L.C. 3848 West Broadway, Suite 5 Minneapolis, MN 55422 Bankruptcy Case No.: 07-42301 Chapter 11 Petition Date: July 5, 2007 Court: District of Minnesota (Minneapolis) Judge: Nancy C. Dreher Debtors' Counsel: Chad J. Bolinske, Esq. 1660 South Highway 100, Suite 508 St Louis Park, MN 55416 Tel: (952) 294-0144 Fax: (952) 294-0146 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's Three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Centerpoint Energy utility charge $101,405 P.O. Box 1144 Minneapolis, MN 55440 City of Robbinsdale water utility $29,439 4100 Lakeview Avenue N Minneapolis, MN 55422 XCEL Energy $2,298 P.O. Box 9477 Minneapolis, MN 55484 RUNNING HORSE: La Jolla Wants Relief from Stay Terminated --------------------------------------------------------- La Jolla Loans Inc. asks the U.S. Bankruptcy Court for the Eastern District of California to terminate the automatic stay imposed in Running Horse, L.L.C., dba Running Horse Golf and Country Club's chapter 11 case, in order to continue with the foreclosure sales. La Jolla also asks the Court to determine that the Debtor is a single asset real estate case as defined in Section 101(51B) of the Bankruptcy Code. La Jolla Debt La Jolla informs the Court that on April 26, 2005, the Debtor executed a Note Secured by Deed of Trust in the principal amount of $10 million. The Note, according to La Jolla, was structured in a way that the first 11 interest only payments in the amount of $108,333 were collected and paid as each came due. On May 1, 2006, the final balloon balance of $10,108,333 was due to be paid. Interest rate was 13% as provided under the Note. To secure performance under the Note, the Debtor executed two Deeds of Trust providing a security interest in 33 parcels of land that are part of the Debtor's property, La Jolla adds. At the request of the Debtor, La Jolla relates that the due date was extended to Aug. 1, 2006, provided that interest payments were made between May 1, 2006 and Aug. 1, 2006. Default When the Debtor failed to make the interest payment due July 1, 2006, La Jolla served a Notice of Default on July 18, 2006 and set foreclosure sales for Nov. 22, 2006. La Jolla relates further that on Nov. 21, 2006, it executed a Forbearance Agreement with the Debtor. Under the agreement, the Debtor acknowledged that as of Nov. 22, 2006, the total amount due was $11,328,595 plus attorney fees and costs. The further acknowledged that the Note would accrue at the daily rate of $5,565 until retired and also said that it had no claims or offsets that would diminish or reduce the amount due under the Note. La Jolla claims it is owed $12,567,090. Terminate Relief from Stay La Jolla reminds the Court that under Section 362(g)(1) of the Bankruptcy Code, the party requesting relief from automatic stay has the burden of proof on the issue of the Debtor's equity in property. La Jolla contends that in its schedules filed with the Court, the Debtor disputes all secured claims. Specifically, the Debtor discloses in its Schedule "D" that it "disputes the priority of the liens as the priority has not yet been ascertained given the large number of mechanic's liens that have been file. Further, La Jolla says, the Debtor's schedules further states that with regard to the mechanic's lien, "perfection is also disputed pending further review." La Jolla contends that without duplicating scheduled secured claims and not counting multiple writs of attachment and the PGA deed of trust, the scheduled liens total $43,869,297. Adding the amount of scheduled priority and unsecured claims, the total amounts to $53,868,625. In its schedules, the Debtor, La Jolla says, values its property between $20 million and $40 million. The Debtor's schedules also show that no equity exists in the property, La Jolla discloses. Considering these facts, La Jolla argues that, "there is no evidence of any reasonable possibility of a successful reorganization within a reasonable period of time." Aside from having no equity, La Jolla further argues that despite being under bankruptcy protection for two months, the Debtor has not provided La Jolla with any form of adequate protection. The Court is set to consider La Jolla's request at a hearing scheduled on Aug. 8, 2007. La Jolla is represented by Thomas H. Armstrong, Esq., in Fresno, California. Trump Offer As reported in the Troubled Company Reporter on July 2, 2007, Mick Evans, owner of Running Horse, and Donald Trump, CEO of real estate developer Trump Organization, signed a definitive agreement in which Mr. Trump will acquire the bankrupt golf course for $40 million. About Running Horse Based in Fresno, California, Running Horse, L.L.C., dba Running Horse Golf and Country Club, -- http://www.runninghorsegolf.com/ -- is a multi-entry private, gated community that has 758 upscale homesites, an 18-hole championship golf course, and a 42,000- square foot clubhouse with spa facilities and a fitness center. The company filed for chapter 11 protection on April 27, 2007 (Bankr. E.D. Calif. Case No. 07-11185). Riley C. Walter, Esq., in Fresno, Calif., represents the Debtor. In its schedules filed with the Court, the Debtor disclosed total assets of $40,511,674 and total debts of $10,309,327. RUNNING HORSE: U.S. Trustee Amended Official Committee Composition ------------------------------------------------------------------ Sara L. Kistler, Acting U.S. Trustee for Region 17, amended the composition of the Official Committee of Unsecured Creditors of Running Horse, L.L.C., dba Running Horse Golf and Country Club. The Committee is now composed of: (1) Harlan Kelly, Sr. 3378 West Kearney Boulevard Fresno, CA 93706 (2) Joyce Scampa 1298 Adode Lane Pacific Grove, CA 93950 (3) Kent Northcross P.O. Box 1568 Tubac, AZ 85646 (4) Rose Marie Joyce 11539 Ridge Gate Whittier, CA 90601 (5) John Rothenfluh 2363 East Cromwell Fresno, CA 94720 (6) Kathleen Sotero P.O. Box 804 Aptos, CA 95001-0804 (7) Mark Angel 77 Middle Canyon Road Carmel Valley, CA 93924 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtors is impossible, the Committee will urge the Bankruptcy Court to convert the chapter 11 cases to a liquidation proceeding. About Running Horse Based in Fresno, California, Running Horse, L.L.C., dba Running Horse Golf and Country Club, -- http://www.runninghorsegolf.com/ -- is a multi-entry private, gated community that has 758 upscale homesites, an 18-hole championship golf course, and a 42,000- square foot clubhouse with spa facilities and a fitness center. The company filed for chapter 11 protection on April 27, 2007 (Bankr. E.D. Calif. Case No. 07-11185). Riley C. Walter, Esq., in Fresno, Calif., represents the Debtor. In its schedules filed with the Court, the Debtor disclosed total assets of $40,511,674 and total debts of $10,309,327. SAMSONITE CORP: CVC Capital Buyout Cues S&P's Negative Watch ------------------------------------------------------------ Standard & Poor's Ratings Services placed its ratings on Mansfield, Massachusetts-based luggage manufacturer Samsonite Corp., including the 'BB-' corporate credit rating, on CreditWatch with negative implications. The company had total reported debt outstanding of about $481.8 million at April 30, 2007. "The CreditWatch listing follows the announcement that, after unanimous Board of Directors approval and majority stockholder approval, Samsonite has entered into a written consent and voting agreement to be acquired by CVC Capital Partners for about $1.7 billion in cash, including the assumption of debt," said Standard & Poor's credit analyst Christopher Johnson. An undisclosed amount of debt financing has been committed by third- party financing sources. "Although financing details have yet to be disclosed, we expect that Samsonite's leverage will increase and that its credit measures will weaken below current levels," said Mr. Johnson. The transaction, which is expected to close in the fourth quarter of 2007, is subject to receipt of regulatory approval, as well as satisfaction of other customary closing conditions. To resolve the CreditWatch, Standard & Poor's will meet with management to discuss the financing of the planned transaction and the company's operating trends. The company's debt leverage and operating strategy after the transaction will be key areas of focus. SANITEC INDUSTRIES: Files for Chapter 11 Protection in California ----------------------------------------------------------------- Sanitec Industries, Inc., on Thursday filed for chapter 11 protection with the U.S. Bankruptcy Court for the Central District of California. The company said however that its environmentally sound medical waste treatment services will continue without disruption while it vigorously defends itself against what it believes to be unwarranted and frivolous litigation by a Texas firm. Sanitec is confident its business will continue to thrive while this matter is quickly and equitably resolved According to Sanitec Industries' president, Jim Harkess, "The filing is in the best interest of our customers, creditors and shareholders by allowing us to focus on our business and avoiding the continued distraction of protracted litigation." Sanitec Industries, Inc. is the global patent holder for the Sanitec(R) Microwave Healthcare Waste Disinfection System(TM). Healthcare facilities nationwide, ranging from large hospital systems to single practitioner doctors' offices, utilize Sanitec systems to transform dangerous healthcare waste into low-volume, unrecognizable, non-infectious material that requires no further treatment and can be safely disposed of in municipal landfills. SANITEC INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Sanitec Industries, Inc. 9053 Norris Avenue Sun Valley, CA 91352 Bankruptcy Case No.: 07-12307 Type of Business: The Debtor's facilities that are operating both at hospitals and at regional waste treatment centers in the United States and in six foreign countries (Brazil, England, Canada, Japan, Korea, and Saudi Arabia), process infectious medical waste. See http://www.sanitecindustries.com/ Chapter 11 Petition Date: July 5, 2007 Court: Central District Of California (San Fernando Valley) Debtor's Counsel: Jeffry A. Davis, Esq. 9255 Towne Centre Drive, Suite 600 San Diego, CA 92121-3039 Tel: (858) 320-3000 Fax: (858) 320-3001 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's Nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Patton Boggs Attorney fees $1,600,000 2550 M. Street Northwest Washington, DC 20037 MicroWaste Corporation Judgment $665,000 c/o Richard E. Griffin, Esq. Jackson Walker LLP 1401 McKinney #1900 Houston, TX 72010 Intertech Corp. Promissory note $600,000 4838 Jenkins Avenue North Charleston, SC 29405 Weston Benshoof Attorney fees $349,312 333 South Hope Street 16th Floor Los Angeles, CA 90071 Bank of America Credit line $135,000 Eugene Robinson Debenture $80,000 Walter Sleeth Debenture $60,000 Richard Metz Debenture $50,000 Automation Electric Trade $37,512 McDonald Hopkins Attorney fees $31,924 Tom Dubbs Trade $28,500 Joe Delloiacovo Trade $25,963 Ruth Bracken Debenture $25,000 Gerred Sexton Debenture $25,000 Bernard Fogelman Debenture $20,000 David Burk Debenture $20,000 Steven Fisher Debenture $20,000 Peter Fitzgerald Debenture $20,000 G & S Hecker Debenture $20,000 Jan Eric Pusch Debenture $20,000 SEA CONTAINERS: Court Approves $176.5 Million DIP Financing ----------------------------------------------------------- The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware authorized Sea Containers Ltd. and its debtor-affiliates to obtain $176 million Debtor-in-Possession Financing Facility from Mariner LCD, Dune Capital LLC and Dune Capital LP, along with Trilogy Capital LLC and Caspian Capital Partners LP. The DIP Facility consists of a term loan of up to $151,500,000, and a $25,000,000 revolving credit facility. The Term Loan provides for a non-amortizing term loan available in a single drawing on the Closing Date. The Debtors intend to use the proceeds of the Term Loan to make a capital contribution to SPC Holdings, Ltd., a non-debtor subsidiary of which SCL holds the entire economic interest. In turn, Holdings will make a capital contribution to Sea Containers SPC Ltd., a bankruptcy remote subsidiary. SPC will then use the proceeds of the capital contribution to repay an existing debt securitization facility. The repayment of the securitization facility will prevent foreclosure by SPC's lenders, which have alleged a default under that facility. In addition, the Term Loan will also be used to pay all costs and expenses of the DIP Lenders and the DIP Agent relating to the structuring of the proposed financing for SCL or SPC. The proceeds of the Revolving Credit Facility will be used for general corporate purposes of SCL in the ordinary course of business. The Debtors believe that the DIP Lenders' proposal is beneficial to the estate as it offers attractive financing terms, including no cash up-front fees or break-up fees. The material terms of the DIP Facility reflected in the DIP Credit Agreement also contains provision regarding: (a) Interest Rate The rate of interest per annum with respect to the unpaid amount of all DIP Loans will be the Eurodollar Rate for the relevant Interest Period plus the Applicable Margin. Non-Default Rate interest on the DIP Obligations will be payable monthly in arrears. (b) Default Rate The annual interest rate to the unpaid amount of all DIP Loans during the continuance of an Event of Default will be the one-month Eurodollar Rate, calculated daily, plus the Applicable Margin plus 2.0%. With respect to the unpaid amount of all other DIP Obligations during the Event of Default, the annual interest rate is the default rate that would be applicable to Revolving Credit Loans. The Default Rate interest on the DIP Obligations will be payable in cash on demand and will be compounded daily. The DIP Credit Agreement includes customary events of default for DIP Financings. SCL's DIP Obligations is secured by a perfected, first priority security interest and lien on (i) its equity interests in Holdings and SPC, (ii) all of its cash and cash equivalents, and (iii) amounts it received or is receivable from Holdings and SPC. Holdings will guarantee the full payment of the DIP Obligations when it comes due. The Guarantee will be secured by a perfected, first priority security interest in all assets of Holdings. The amount of the Guarantee, however, will be limited to the value of Holdings' assets at the time the guarantee is given. All DIP Obligations will be granted superpriority administrative expense claim with priority over all other costs and expenses of any kind. As additional protection, SCL agrees not to seek any order that attempts to grant any other party a superpriority claim or otherwise subordinate the DIP Obligations or the DIP Lien. The DIP Lenders' superpriority administrative expense claim will be payable from all of the Debtors' properties. SCL will pay all costs and expenses of the DIP Lenders and the DIP Agent relating to the structuring of the proposed financing SCL or SPC. SCL will also pay a refinancing fee equal to 1% of the aggregate amount of the cash proceeds of the Term Loan on the Closing Date. Under the DIP Credit Agreement, refinancing is defined as the repayment or replacement of the DIP Obligations. SCL will also pay a non-emergence fee on the one-year anniversary of the DIP Effective Date, in an amount equal to 1% of the aggregate principal amount then outstanding under the DIP Facility, unless all outstanding DIP Obligations have already been fully paid. An unutilized commitment fee will be paid by SCL at an annual rate of 1% on the average daily unused portion of the Revolving Credit Facility, which is payable monthly in arrears. The DIP Lien and the superpriority of the DIP Obligations will be subject only to a carve-out for: * unpaid fees payable pursuant to Section 1930 of the Judiciary and Judicial Procedures Code, * all claims for fees and expenses of the Court-approved professionals. The DIP Credit Agreement will terminate once: -- all the DIP Obligations are paid in full, -- SCL's plan of reorganization is confirmed, -- the DIP Obligations are accelerated, -- a Sale Order for all of SCL's assets is entered, or -- the Debtors' case is converted into a Chapter 7 case. In either case, the stated maturity of the DIP Credit Agreement is two years after the Closing Date. The DIP Lenders' proposal will allow the Debtors to lock in permanent financing, which will enable them to focus on efforts going forward on key restructuring initiatives and developing a confirmable Chapter 11 plan. On May 3, 2007, Sea Containers Ltd. agreed with Mariner LCD, Dune Capital LLC and Dune Capital LP, along with Trilogy Capital LLC and Caspian Capital Partners LP, on a Commitment Letter that set forth the terms for a DIP facility. A full-text copy of the May 3, 2007 DIP Financing Agreement is available for free at: http://ResearchArchives.com/t/s?2172 The parties subsequently amended the DIP Financing Agreement, which revision was presented to the Court on June 15, 2007. A full-text copy of the revised DIP Financing Agreement is available for free at: http://ResearchArchives.com/t/s?2173 About Sea Containers Headquartered in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers Ltd. disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Court extended the Debtors' exclusive period to file a Plan of Reorganization to Sept. 28, 2007. (Sea Containers Bankruptcy News, Issue No. 22; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) SKILLED HEALTHCARE: IPO Completion Cues S&P to Lift Ratings ----------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on Foothill Ranch, California-based nursing home operator Skilled Healthcare Group Inc. The corporate credit rating was raised to 'B+' from 'B'. The secured bank loan ratings were raised to 'BB-' from 'B', and the recovery rating was revised to '2', indicating the expectation for substantial (70%-90%) recovery in the event of a payment default, from '3'. The subordinated debt rating was raised to 'B-' from 'CCC+'. The ratings were removed from CreditWatch, where they were placed with positive implications May 2, 2007, following the company's registration to sell common stock with the stated intention to reduced debt. The outlook is stable. "The corporate credit rating change reflects the completion of the May 2007 IPO, and the beneficial impact on the company's financial profile," said Standard & Poor's credit analyst David Peknay. Skilled used approximately $117 million of net proceeds from the IPO to repay most of the existing balance on its revolving credit facility and repay about $70 million of its senior subordinated notes. The revision to the bank loan and recovery ratings are the result of the upgrade to the corporate credit rating as well as changes to the recovery rating scale that were implemented on June 7, 2007. The low-speculative-grade rating on Skilled reflects the risks associated with the company's concentration in only three states, its exposure to uncertain third-party reimbursement, and risks associated with a relatively aggressive growth strategy. SOLUTIA INC: Recorded Claims Transfers as of July 2 --------------------------------------------------- The Bankruptcy Clerk for the U.S. Bankruptcy Court for the Southern District of New York recorded a total of $1,443,639 claims which changed hands between June 27, 2007 and July 2, 2007 in Solutia Inc. and its debtor-affiliates' chapter 11 cases: Face Amount Transferor Transferee Claim No. of Claims ---------- ---------- --------- --------- Sig Southwest Inc. Argo Partners - $56,162 Aceto Corp. Hain Capital 1584 96,066 Holdings, LLC Comprehensive Search CVI GVF (Lux) - 218,680 Master S.a.r.l. Comprehensive Search, CVI GVF (Lux) 3407 217,751 Inc. Master S.a.r.l. Comprehensive Search, CVI GVF (Lux) 3407 218,228 Inc. Master S.a.r.l. Regional Valve Corp. CVI GVF (Lux) - 67,194 Of Florida Master S.a.r.l. US Filter/IonPure Hain Capital 64 569,558 Holdings, LLC Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ) -- http://www.solutia.com/-- and its subsidiaries, engage in the manufacture and sale of chemical-based materials, which are used in consumer and industrial applications worldwide. The company and 15 debtor-affiliates filed for chapter 11 protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the Debtors filed for protection from their creditors, they listed $2,854,000,000 in assets and $3,223,000,000 in debts. Solutia is represented by Allen E. Grimes, III, Esq., at Dinsmore & Shohl, LLP and Conor D. Reilly, Esq., at Gibson, Dunn & Crutcher, LLP. Trumbull Group LLC is the Debtor's claims and noticing agent. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the Official Committee of Unsecured Creditors, and Derron S. Slonecker at Houlihan Lokey Howard & Zukin Capital provides the Creditors' Committee with financial advice. The Court is set to consider approval of the Disclosure Statement describing Solutia's First Amended Reorganization Plan on July 10, 2007. The Debtors' exclusive period to file a plan expires on July 30, 2007. (Solutia Bankruptcy News, Issue No. 91; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). STATION CASINO: Moody's Assigns Corporate Family Rating at (P)B2 ---------------------------------------------------------------- Moody's Investors Service assigned a (P)B2 Corporate Family Rating to Station Casinos, Inc. assuming a post leveraged buyout capital structure as outlined in its amended preliminary proxy statement dated June 26, 2007. Moody's also assigned a (P)Ba2 rating to Station's proposed six year $500 million senior secured guaranteed revolving credit facility. Station's existing senior unsecured and senior subordinated notes are expected to remain outstanding. Based on the proposed post LBO capital structure, Moody's will likely downgrade Station's existing senior unsecured notes to B1 from Ba2, and its existing senior subordinated notes to Caa1 from Ba3 when the LBO transaction closes later this year. However, these ratings will remain on review for downgrade until final terms of debt financings for the LBO are established and there is a greater certainty that the transaction will close. The closing remains subject to shareholder and regulatory approval. The (P)B2 CFR reflects high pro-forma adjusted debt to EBITDAR (estimated range of 8x - 8.5x), low EBITDA to interest coverage (estimated range 1.75x - 2x), a small level of free cash flow for debt repayment, tight liquidity, and a reliance on earning growth to improve credit metrics. Taken together, these considerations will significantly limit Station's financial flexibility. Concentration risk in the Las Vegas locals market, off-balance sheet leveraged development joint ventures, as well as expected growth in capital spending for new on-balance sheet developments have been factored into the ratings. Positive rating consideration was given to the large equity contribution by affiliates of Colony Capital, LLC, roll-over of existing equity, and Station's successful development and operational track record in the stable Nevada regulatory environment. The rating outlook is stable reflecting positive operating trends in the Las Vegas locals market and Moody's expectation that Station's will increase EBITDA in 2007 and 2008 as a result of positive returns from capital projects and same store earnings growth. Station's ratings could be downgraded if earnings growth does not meet expectations or if leverage increases above expected pro-forma levels. Upside rating momentum is limited in the near term unless earnings increase at a materially faster pace then currently contemplated. The new bank revolver will be guaranteed by certain wholly-owned subsidiaries and will be secured by a lien on the Texas Station and Red Rock properties. Pursuant to Moody's loss given default methodology, the rating of the proposed senior secured $500 million bank revolver takes into account the significant level of unsecured and subordinated debt in the capital structure that will be junior to the bank revolver. Should the company avail itself of the $450 million accordian feature, the rating of the bank revolver could be revised downward as a result of an increase in the amount of senior secured debt relative to junior debt in the capital structure. Through a series of transactions, Station is expected to sell the real estate associated with six of its core properties (Palace Station, Boulder Station, Sunset Station, Santa Fe Station, Fiesta Rancho and Fiesta Henderson) to indirect wholly-owned unrestricted special purpose subsidiaries and lease back such real estate. Station will then sublease the real estate to wholly-owned restricted operating subsidiaries that have been operating, and will continue to operate, the properties. Special purpose entities affiliated with the Propcos will issue notes in the aggregate principal amount of $2.725 billion collateralized by a lien on the aforementioned real estate and an assignment of the leases. The CMBS notes will be serviced by lease payments from the Opcos. Station will finance the LBO with new equity ($2.6 billion), issuance of $2.725 billion of collateralized mortgage securities and drawings under the new bank revolver; the existing senior and senior subordinated notes are expected to remain outstanding. On February 23, 2007, the company entered into a definitive merger agreement with Fertitta Colony Partners LLC, pursuant to which FCP agreed to acquire all of Station's outstanding common stock for $90 per share in cash. FCP is a new company formed by Frank J. Fertitta III, Chairman and Chief Executive Officer of Station, Lorenzo J. Fertitta, Vice Chairman and President of Station and Colony Capital Acquisitions, LLC, an affiliate of Colony Capital, LLC. On June 26, 2007, Station filed an amended preliminary proxy statement and related materials with the Securities and Exchange Commission that provides details about the pending sale of the company. Ratings assigned to Station Casinos, Inc. post LBO: -- Corporate Family Rating at (P)B2 -- Probability of Default at B2 -- Outlook: Stable -- $500 million senior secured revolving credit facility at (P)Ba2 (LGD1, 4%) Station Casinos, Inc. owns and operates gaming and entertainment facilities including Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Casino and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Magic Star Casino, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Barley's Casino & Brewing Company and The Greens in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, Station manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. SWIFT & COMPANY: Tender Offer Expiration Extended Until Tomorrow ---------------------------------------------------------------- Swift & Company and its affiliates S&C Holdco 3, Inc. and Swift Foods Company extended their previously announced cash tender offers. The tender offers, previously scheduled to expire at midnight, New York City time, on July 5, 2007, will now expire at 8:00 a.m., New York City time, on Tuesday, July 10, 2007, unless further extended by the companies. The tender offers are being extended to coordinate the closing of the tender offers with the closing of the previously announced acquisition of SFC by J&F Participacoes, S.A., a Brazilian corporation. Except for the extension of the Offer Expiration Date, all terms and conditions of the tender offers are unchanged and remain in full force and effect. On June 21, 2007, the companies disclosed that they have received the requisite consents to adopt the proposed amendments to the applicable indentures governing the: * 10-1/8% Senior Notes due 2009 issued by S&C, * 12-1/2% Senior Subordinated Notes due January 1, 2010 issued by S&C, * 11.00% Senior Notes due 2010 issued by S&C Holdco 3, and * 10.25% Convertible Senior Subordinated Notes due 2010 issued by SFC, pursuant to the consent solicitations. The Companies have been advised by the depositary for the tender offers that, as of 5:00 p.m., New York City time, on July 5, 2007, S&C has received validly tendered and not withdrawn tenders of: (i) approximately $ 265.8 million of outstanding 10-1/8% Senior Notes, or approximately 99.2% of the aggregate principal amount of 10-1/8% Senior Notes outstanding and (ii) approximately $137.7 million of outstanding Subordinated Notes, or approximately 91.8% of the aggregate principal amount of Subordinated Notes outstanding. S&C Holdco 3 has received validly tendered and not withdrawn tenders and consents of approximately $125.1 million of outstanding 11.00% Senior Notes, or approximately 99.9% of the aggregate principal amount of 11.00% Senior Notes outstanding. SFC has received validly tendered and not withdrawn tenders and consents of approximately $94.2 million of outstanding Convertible Notes, or approximately 99.9% of the aggregate principal amount of Convertible Notes outstanding. Each company, the applicable guarantors and the trustee have entered into a supplemental indenture for the applicable Notes giving effect to the amendments. The amendments to the indentures contained in such supplemental indentures became effective upon execution of the supplemental indenture, but will not become operative until the date on which all Notes validly tendered prior to the Offer Expiration Date are accepted for purchase pursuant to the terms of the Offer Documents. The right to withdraw tendered Notes and to revoke delivered consents terminated upon execution of the supplemental indentures. The tender offers and consent solicitations are being made upon the terms and subject to the conditions set forth in the Offer to Purchase and Consent Solicitation Statement dated June 7, 2007, as amended and supplemented by the Supplement and Amendment to Offer to Purchase and Consent Solicitation Statement dated June 19, 2007, and the accompanying Consent and Letter of Transmittal. The companies are making the tender offers and consent solicitations in connection with the Acquisition. The tender offers by each company will expire on the Offer Expiration Date and the deadline for holders of the Notes to tender their Notes will be the Offer Expiration Date. The tender offers are conditioned upon, among other things, the consummation of the Acquisition. Each company expects to pay for any of its Notes purchased pursuant to its tender offer and consent solicitation in same- day funds on a date promptly following the satisfaction or waiver of the conditions to the closing of the Acquisition and the acceptance of such validly tendered and not withdrawn Notes. The companies have retained J.P. Morgan Securities Inc. to act as the Dealer Manager and the Solicitation Agent in connection with the tender offers and consent solicitations. Questions about the tender offers and consent solicitations may be directed to J.P. Morgan Securities Inc. at (800) 245-8812 (toll free) or (212) 270- 1477 (collect). Copies of the Offer Documents may be obtained from D.F. King & Co., Inc., the Information Agent for the tender offers and consent solicitations, at (800) 290-6427 (toll free) or (212) 269- 5550 (collect). About Swift & Company Headquartered in Greeley, Colorado, Swift & Company -- http://www.swiftbrands.com/-- is the third-largest processor of fresh beef and pork in the U.S. and the largest beef processor in Australia. The company processes, prepares, packages, markets and delivers fresh, further-processed and value-added beef and pork products to customers in the United States and international markets. SWIFT & CO: S&P Revises CreditWatch to Positive from Developing --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to J&F I Finance Co., and its 'B-' unsecured debt rating to J&F I Finance's proposed: * $200 million of senior notes due 2015, * $200 million of senior toggle notes due 2015, and * $200 million of senior floating rate notes due 2014. J&F I Finance Co. will be merged with and into Swift & Co. At the same time, Standard & Poor's revised the CreditWatch implications of all ratings on Swift, including the 'B' corporate credit rating, to positive from developing, where they were placed on May 29, 2007, following JBS S.A.'s (JBS; B+/Watch Neg/--) announcement that its holding company J&F Participacoes (J&F; not rated) had signed an agreement for the acquisition of 100% of U.S.-based Swift for $1.4 billion (enterprise value). All ratings on J&F I Finance are placed on CreditWatch with positive implications, meaning the ratings may be raised or affirmed following the completion of Standard & Poor's review. The ratings on Brazil-based meat processing company JBS remain on CreditWatch with negative implications, where they were placed on May 29, 2007 following the Swift acquisition announcement. Proceeds from the proposed notes offerings will be used to finance the acquisition of Swift, along with $500 million of equity from J&F, and approximately $300 million-$400 million of borrowings on Swift's proposed $700 million asset-based revolving credit facility (unrated), which matures in May 2012. Pro forma for the transaction, rated debt at Swift will be approximately $600 million. Although Swift is being acquired by J&F I Finance, a subsidiary of J&F, Standard & Poor's views JBS and Swift as one economic entity given the common ownership, management, and lines of businesses of the two companies, the consolidation of the Swift brand under one owner, and the willingness of its owners to contribute $500 million of equity to complete this transaction. "We believe that the new owners will face some challenges in acquiring Swift given its very weak performance of the last several years due to mad cow disease, its low margins, the highly competitive operating environment, and the inherent differences of the U.S. market," said Standard & Poor's credit analyst Jayne Ross. The resolution of the CreditWatch will depend on the final acquisition and funding details, including the ultimate capitalization structure at Swift and JBS. The Swift ratings could be raised to 'B+' and equalized with JBS, and JBS' ratings would be affirmed if significant additional equity is contributed to the transaction, for example as a result of the announced commitment to JBS from BNDES Participacoes S.A. for up to R$1.46 billion (approximately $750 million) and a commitment from J&F for up to R$390 million (approximately $200 million). Upon closing of the new financing transaction, Standard & Poor's existing senior unsecured and subordinated debt ratings on Swift will be withdrawn when these notes get repaid. "We will resolve the CreditWatch listings for both Swift and JBS upon closing of the acquisition and completion of the financing," said Ms. Ross. "Any further significant change in financing details could result in a revision of these proposed ratings at both Swift and JBS." TOWER ENTERPRISES: Case Summary & 12 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Tower Enterprises, Ltd. P.O. Box 1025 Siloam Springs, AR 72761 Bankruptcy Case No.: 07-72065 Chapter 11 Petition Date: July 5, 2007 Court: Western District of Arkansas (Fayetteville) Debtor's Counsel: Donald A. Brady, Jr., Esq. Adams, Brady & Jackson, PLLC 216 1/2 East Emma Avenue Springdale, AR 72764 Tel: (479) 927-9062 Fax: (479) 927-9039 Total Assets: $8,137,214 Total Debts: $5,156,519 Debtor's List of its 12 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Ken Fullerton Lot Swap $120,000 Highway 412 East Siloam Springs, AR 72761 Leon Davis/Davis Family Trust Lot Swap $120,000 1270 U.S. Highway 412 West Siloam Springs, AR 72761 C.O. Ising Real Estate $75,000 107 A Gunter Street Siloam Springs, AR 72761 Mary Ellen Michael 2nd Mortgage $50,000 S.D. Lawlis Personal Loan $50,000 John Gee Excavation Excavation Services $44,182 Jerry and Shelly Reid Asphalt Street $30,000 Zurich North America Payroll Audit $28,028 James Surveying and surveying of McClellan $8,175 Consulting Property Civil Engineering Inc. McClellan $4,406 Benton County Stone McClellan Meadows $4,355 First Comp Audit $2,882 TWEETER HOME: Gets Final Court OK to Use GECC Cash Collateral ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave Tweeter Home Entertainment Group Inc. and its debtor-affiliates authority, on a final basis, to use the cash collateral securing repayment of their obligation to General Electric Capital Corporation, as administrative agent to the Debtors' prepetition lenders. Specifically, the Court permitted the Debtors to use the fund on the earlier of: -- January 11, 2008; -- the effective date of a plan of reorganization for any of the Debtors; -- the date of consummation of a sale of all of the Debtors' assets; and -- the occurrence of an event of default. The Debtors said they need to use Cash Collateral to meet payroll obligations and pay necessary expenses. The Prepetition Lenders will receive replacement liens as adequate protection on account of the granting of liens in favor of the DIP Lenders, the Debtors' use of Cash Collateral, and other diminution in value of the Cash Collateral. The Debtors will also establish an account in the control of the agent under their Prepetition Credit Agreement. In the event of default, the Debtors will deposit $600,000 from the proceeds of any sale, lease or other disposition of assets to secure any reimbursement, indemnification or other continuing obligations of the Debtors in favor of the Prepetition Agent and the Prepetition Lenders. The Official Committee of Unsecured Creditors will have right and standing, and will act as the Debtor-estates' representative, to bring any claims or causes of action challenging the validity, extent, perfection or priority of the mortgage, security interests and liens of the Prepetition Lenders. Any other party- in-interest with requisite standing may also bring a similar challenge. However, any claim or causes of action against the Prepetition Agent or the Prepetition Lenders must be commenced by September 5, 2007, unless extended. About Tweeter Home Based in Canton, Mass., Tweeter Home Entertainment Group Inc. -- http://www.tweeter.com/-- retails mid-to high-end audio and video consumer electronics products. Tweeter and seven of its affiliates filed for chapter 11 Protection on June 11, 2007 (Bankr. D. Del. Case No: 07-10787 through 07-10796). Gregg M. Galardi, Esq. and Mark L. Desgrosseilliers, Esq. at Skadden, Arps, Slate, Meagher & Flom, L.L.P. represent the Debtors in their restructuring efforts. As of Dec. 21, 2006, Tweeter had total assets of $258,573,353 and total debts of $190,417,285. The Debtors' exclusive period to file a plan expires on Oct. 9, 2007. Tweeter Bankruptcy News, Issue No. 5, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000). TWEETER HOME: Asset Sale Procedures Get Court Approval ------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware approved the procedures proposed by Tweeter Home Entertainment Group Inc. and its debtor-affiliates for the sale of substantially all of their assets. Specifically, the Court ruled that the United States Trustee may appoint a consumer privacy ombudsman, and the Debtors will give notice of the proposed sale to the consumer privacy ombudsman. In a separate order, the Court said Whippoorwill Associates, Inc. and Bay Harbour Management, L.C., will be entitled to a break-up fee and expense reimbursement equal to 3% of the purchase price. These rules will apply at any auction that includes the Tivoli Audio LLC assets: -- the minimum initial overbid will provide value to the Debtors of not less than $250,000 above the return to be provided after payment with respect to the break-up fee and expense reimbursement; -- subsequent overbids must be in increments of at least $250,000 in cash; and -- Whippoorwill and Bay Harbour Management will be entitled to credit bid the amount of the break-up fee and expense reimbursement. Last month, Tweeter Home disclosed in a press statement two "stalking horse" bids for its assets in connection with the company's Chapter 11 reorganization efforts. Schultze Asset Management LLC has made a $38 million "going concern" bid for substantially all of the Company's assets. Schultze would also assume $8 million of Tweeter's "cure costs" associated with the company's bankruptcy proceeding, as well as provide the national specialty consumer electronics retailer with a $10 million junior debtor-in-possession line of credit. Tweeter intends to use the $10 million in new funding to purchase merchandise and for other general corporate purposes. Schultze's bid includes the purchase of Tweeter's 18.75% interest in Tivoli Audio, LLC Separately, Whippoorwill Associates, Inc. and Bay Harbour Management, L.C. have teamed up to make a $10 million bid for just Tweeter's Tivoli ownership interest. An auction will commence on July 10, 2007 among Schultze, Whippoorwill, Bay Harbour and any other qualified bidder. "We are pleased to complete these important steps in our restructuring process as we move forward," said Tweeter President and CEO Joe McGuire. "Our objective is to bring cash into the Company as quickly and responsibly as possible and today's events move us closer to that goal." About Schultze Asset Management Founded in 1998, Schultze Asset Management, LLC -- http://www.samco.net/-- is a leading alternative investments firm specializing in distressed and special situations investing. The firm manages approximately $725 million in assets on behalf of institutional and high net worth clients located throughout the world. Schultze's offices are in Purchase, NY. About Whippoorwill Associates and Bay Harbour Whippoorwill Associates, Inc. and Bay Harbour Management L.C. are investment managers specializing in distressed securities and special situations. About Tweeter Home Based in Canton, Mass., Tweeter Home Entertainment Group Inc. -- http://www.tweeter.com/-- retails mid-to high-end audio and video consumer electronics products. Tweeter and seven of its affiliates filed for chapter 11 Protection on June 11, 2007 (Bankr. D. Del. Case No: 07-10787 through 07-10796). Gregg M. Galardi, Esq. and Mark L. Desgrosseilliers, Esq. at Skadden, Arps, Slate, Meagher & Flom, L.L.P. represent the Debtors in their restructuring efforts. As of Dec. 21, 2006, Tweeter had total assets of $258,573,353 and total debts of $190,417,285. The Debtors' exclusive period to file a plan expires on Oct. 9, 2007. Tweeter Bankruptcy News, Issue No. 5, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000). UNITED AIR: Unit Expects $40 Million Gain in Sale of ARINC Stake ---------------------------------------------------------------- UAL Corporation's wholly-owned subsidiary, United Air Lines, Inc., along with five other airlines, entered into a Stock Purchase Agreement with ARINC Inc., and Radio Acquisition Corp., an affiliate of the Carlyle Group. Under the agreement, the airlines, holding over 90% of ARINC shares, will sell their respective stakes to Radio Acquisition. The sale is expected to close before Oct. 31, 2007. According to the company, it expects to receive proceeds of approximately $125 million and record more than $40 million gain from the sale. In a report by the Wall Street Journal, along with United Air, the other airlines in the deal are: * AMR Corp.'s American Airlines Inc., * Continental Airlines Inc., * Delta Air Lines Inc., * Northwest Airlines Corp. and * US Airways Group Inc. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. - http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Air Lines, Inc. United Airlines is the world's second largest air carrier. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. Judge Wedoff confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. * * * As reported in the Troubled Company Reporter on May 3, 2007, Fitch Ratings has affirmed the Issuer Default Ratings of UAL Corp. and its principal operating subsidiary United Airlines Inc. at B-. US AIRWAYS: Inks Agreement Selling ARINC Stake to Carlyle --------------------------------------------------------- US Airways Group Inc., along with five other airlines, entered into a Stock Purchase Agreement selling their stake in ARINC Inc. to Radio Acquisition Corp., an affiliate of the Carlyle Group, the Wall Street Journal reports. The five other airlines are: * AMR Corp.'s American Airlines Inc., * UAL Corp.'s United Air Lines Inc., * Continental Airlines Inc., * Delta Air Lines Inc. and * Northwest Airlines Corp. According to the report, the airlines, who holds over 90% of ARINC shares, expects to gain around $1 billion. The sale is expected to close before Oct. 31, 2007. AMR said that it expects to receive $194 million from the sale while UAL said it expect to get $125 million. WSJ relates that the airlines declined to comment further on the deal. About Carlyle Founded in 1987, The Carlyle Group -- http://www.carlyle.com/-- is an equity firm with $46.9 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. The firm has invested $24 billion of equity in 576 transactions for a total purchase price of $101.8 billion. Carlyle portfolio companies have more than $68 billion in revenue and employ more than 200,000 people around the world. About ARINC ARINC Inc. - http://www.arinc.com/-- provides transportation communications and systems engineering. The company has locations in Germany, Spain, China, Japan, Taiwan, Thailand and Singapore, among others. About U.S. Airways Group Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) - http://www.usairways.com/-- primary business activity is the ownership of the common stock of US Airways, Inc., Allegheny Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc., MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc., Material Services Company, Inc., and Airways Assurance Limited, LLC. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another chapter 11 petition on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in their restructuring efforts. In the Company's second bankruptcy filing, it lists $8,805,972,000 in total assets and $8,702,437,000 in total debts. The Debtors' Chapter 11 plan for its second bankruptcy filing became effective on Sept. 27, 2005. The Debtors completed their merger with America West on the same date. * * * As reported in the Troubled Company Reporter on March 13, 2007, Standard & Poor's Ratings Services assigned its 'B' rating to US Airways Group Inc.'s $1.6 billion secured credit facility due 2014, currently being syndicated. WAMU MORTGAGE: Moody's Assigns Low-B Ratings to Two Certificates ---------------------------------------------------------------- Moody's Investors Service assigned a Aaa rating to the senior certificates issued by WaMu Mortgage Pass-Through Certificates, Series 2007-OA6, 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 originated by Washington Mutual Bank. The ratings are based primarily on the credit quality of the loans, and on the protection from subordination. Moody's expects collateral losses to range from 0.95% to 1.15% Washington Mutual Bank will service the loans and Washington Mutual Mortgage Securities Corp. will act as its administrative agent with respect to the servicing of the loans. The complete rating actions are: WaMu Mortgage Pass-Through Certificates, Series 2007-OA6 Trust WaMu Mortgage Pass-Through Certificates, Series 2007-OA6 -- Cl. 1A, Assigned Aaa -- Cl. 1A-1B, Assigned Aaa -- Cl. 2A, Assigned Aaa -- Cl. CA-1B, Assigned Aaa -- Cl. CA-1C, Assigned Aaa -- Cl. 1X-PPP, Assigned Aaa -- Cl. 2X-PPP, Assigned Aaa -- Cl. R, Assigned Aaa -- Cl. B-1, Assigned Aa1 -- Cl. B-2, Assigned Aa1 -- Cl. B-3, Assigned Aa1 -- Cl. B-4, Assigned Aa1 -- Cl. B-5, Assigned Aa2 -- Cl. B-6, Assigned A2 -- Cl. B-7, Assigned Baa1 -- Cl. B-8, Assigned Baa3 -- Cl. B-9, Assigned Ba2 -- Cl. B-10, Assigned B2 WOLF RIVER: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Wolf River Edge, LLC dba The Slipknot 204 Wolf River Drive P.O. Box 534 Fremont, WI 54940 Bankruptcy Case No.: 07-25175 Chapter 11 Petition Date: July 5, 2007 Court: Eastern District of Wisconsin (Milwaukee) Judge: Margaret Dee McGarity Debtor's Counsel: J. David Krekeler, Esq. Krekeler Strother, S.C. 15 North Pinckney Street, Suite 200 P.O. Box 828 Madison, WI 53701-0828 Tel: (608) 258-8555 Fax: (608) 258-8299 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 ------ --------------- ------------ Dierks Waukesha Foods Trade Debt $50,246 P.O. Box 68-5015 Waukesha, WI 53186 WE Energies Utilities $31,042 P.O. Box 2089 Milwaukee, WI 53201-2089 Anthony Meyerhofer Personal Loan $24,470 N1615 County Road J Kaukauna, WI 54130-1266 Appleton Acoustical Trade Debt $23,763 Wisconsin Distributors Trade Debt $12,131 Commercial Appliance Trade Debt $9,088 General Beverage Sales Co. Trade Debt $6,392 Badger Wholesale Co. Inc. Trade Debt $5,086 New London Kist Bottling Co. Soda, Juices Beverage $4,849 Knaus Cheese Inc. Trade Debt $3,550 Mass Appeal Specialties Inc. Trade Debt $3,053 Meat Processors $2,943 Graichen Sanitation Trade Debt $2,350 Peter Burke Trade Debt $1,661 Century Tel Trade Debt $1,563 Lee Beverage of Wisconsin Trade Debt $1,483 Sam's Club Trade Debt $1,200 CWA Sales and Lease Inc. Trade Debt $990 Quaker Bakery Trade Debt $960 Superior Chemical Company Trade Debt $910 * BOND PRICING: For the week of July 2 - July 6, 2007 ----------------------------------------------------- Issuer Coupon Maturity Price ------ ------ -------- ----- ABC Rail Product 10.500% 01/15/04 0 ABC Rail Product 10.500% 12/31/04 0 Acme Metals Inc 12.500% 08/01/02 0 AHI-DFLT07/05 8.625% 10/01/07 71 Aladdin Gaming 13.500% 03/01/10 0 Albertson's Inc 6.520% 04/10/28 74 Allegiance Tel 11.750% 02/15/08 51 Allegiance Tel 12.875% 05/15/08 16 Amer & Forgn Pwr 5.000% 03/01/30 66 Atherogenics Inc 1.500% 02/01/12 47 Atlantic Coast 6.000% 02/15/34 6 Bank New England 8.750% 04/01/99 8 Bank New England 9.500% 02/15/96 14 Bank New England 9.875% 09/15/99 9 Budget Group Inc 9.125% 04/01/06 0 Burlington North 3.200% 01/01/45 54 Calpine Gener Co 11.500% 04/01/11 38 Cell Therapeutic 5.750% 06/15/08 72 Collins & Aikman 10.750% 12/31/11 2 Color Tile Inc 10.750% 12/15/01 0 Comprehensive Care 7.500% 04/15/10 60 Decode Genetics 3.500% 04/15/11 73 Decode Genetics 3.500% 04/15/11 72 Delta Mills Inc 9.625% 09/01/07 16 Desa Intl Inc 9.875% 12/15/07 0 Deutsche Bank NY 8.500% 11/15/16 66 Diamond Triumph 9.250% 04/01/08 64 Dura Operating 8.625% 04/15/12 66 Dura Operating 9.000% 05/01/09 11 Dura Operating 9.000% 05/01/09 7 Dvi Inc 9.875 02/01/04 10 Encysive Pharma 2.500% 03/15/12 64 Exodus Comm Inc 11.250% 07/01/08 0 Fedders North Am 9.875% 03/01/14 33 Finova Group 7.500% 11/15/09 21 Florsheim Group 12.750 09/01/02 0 Ford Motor Co 6.375% 02/01/29 73 Ford Motor Co 6.625% 02/15/28 74 Ford Motor Co 6.625% 10/01/28 74 Golden Books Pub 10.750% 12/31/04 0 Gulf States STL 13.500% 04/15/03 0 Insight Health 9.875% 11/01/11 31 Iridium LLC/CAP 10.875% 07/15/05 15 Iridium LLC/CAP 11.250% 07/15/05 16 Iridium LLC/CAP 13.000% 07/15/05 18 Iridium LLC/CAP 14.000% 07/15/05 17 JTS Corp 5.250% 04/29/02 0 Kaiser Aluminum 9.875% 02/15/02 21 Kaiser Aluminum 12.750% 02/01/03 11 Kellstrom Inds 5.500 06/15/03 2 Lehman Bros Holding 10.000% 10/30/13 69 Lehman Bros Holding 11.000% 10/25/17 75 Liberty Media 3.750% 02/15/30 62 Liberty Media 4.000% 11/15/29 66 Lifecare Holding 9.250% 08/15/13 67 Missouri PAC RR 5.000% 01/01/45 75 Motorola Inc 5.220% 10/01/97 71 Movie Gallery 11.000% 05/01/12 22 New Orl Grt N RR 5.000% 07/01/32 66 Northern Pacific RY 3.000% 01/01/47 52 Northern Pacific RY 3.000% 01/01/47 52 Northwest Steel & Wire 9.500% 06/15/01 0 NTK Holdings Inc 10.750% 03/01/14 72 O'Sullivan Ind 10.630% 10/01/08 0 Oakwood Homes 7.875% 03/01/04 11 Oscient Pharma 3.500% 04/15/11 74 Outboard Marine 9.125% 04/15/17 0 Pac-West Telecom 13.500% 02/01/09 25 Pac-West Telecom 13.500% 02/01/09 11 PCA LLC/PCA FIN 11.875 08/01/09 5 Pegasus Satellite 9.625% 10/15/49 0 Pegasus Satellite 12.375% 08/01/08 0 Piedmont Aviat 10.250% 01/15/49 0 Piedmont Aviat 10.250% 01/15/49 0 Polaroid Corp 6.750% 01/15/02 0 Polaroid Corp 7.250% 01/15/07 0 Polaroid Corp 11.500% 02/15/06 0 Primus Telecom 3.750% 09/15/10 73 Primus Telecom 8.000% 01/15/14 73 Radnor Holdings 11.000% 03/15/10 0 Read-Rite Corp 6.500% 09/01/04 0 RJ Tower Corp. 12.000% 06/01/13 3 Scott Cable Comm 16.000% 07/18/02 0 SLM Corp 5.500% 06/15/29 74 SLM Corp 5.500% 03/15/30 73 SLM Corp 5.500% 03/15/30 74 SLM Corp 5.500% 12/15/30 74 SLM Corp 5.600% 12/15/29 74 SLM Corp 5.750% 03/15/30 75 SLM Corp 5.850% 12/15/31 75 Spacehab Inc 5.500% 10/15/10 52 Times Mirror Co 7.250% 11/15/96 69 Tom's Foods Inc 10.500% 11/01/04 2 Tousa Inc 7.500% 03/15/11 71 Tousa Inc 7.500% 01/15/15 68 TransTexas Gas 15.000% 03/15/05 0 United Air Lines 9.200% 03/22/08 52 United Air Lines 10.125% 03/22/15 52 United Homes Inc. 11.000% 03/15/05 0 US Air Inc. 10.550% 01/15/49 0 US Air Inc. 10.680% 06/27/08 14 US Air Inc. 10.700% 01/01/49 0 US Air Inc. 10.700% 01/15/49 0 US Air Inc. 10.800% 01/01/49 0 US Air Inc. 10.800% 01/01/49 0 US Air Inc. 10.900% 01/01/49 0 USAutos Trust 2.212% 03/03/11 7 Vesta Insurance Group 8.750% 07/15/25 4 Werner Holdings 10.000% 11/15/07 3 Westpoint Steven 7.875% 06/15/05 0 Westpoint Steven 7.875% 06/15/08 0 Wheeling-Pitt St 5.000% 08/01/11 70 Wheeling-Pitt St 6.000% 08/01/10 70 Winstar Comm Inc 10.000% 03/15/08 0 Winstar Comm Inc 12.750% 04/15/10 0 Winstar Comm 14.000% 10/15/05 0 ********* 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- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***