/raid1/www/Hosts/bankrupt/TCR_Public/070712.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, July 12, 2007, Vol. 11, No. 163
Headlines
534 LAS AMERICAS: Section 341(a) Meeting Scheduled on July 26
534 LAS AMERICAS: Fannie Mae Objects to Use of Cash Collateral
ADELPHIA COMMS: Wants Across Media Settlement Agreement Approved
ADVANCED MEDICAL: Bausch & Lomb Bid Cues S&P's Developing Watch
AEROFLEX INC: Revised Veritas Offer Cues S&P to Remove Neg. Watch
AKRON THERMAL: Court Approves Sasco Hill as Financial Advisor
ALLIS-CHALMERS: Sees $200MM Add'l Revenues from Pan American Deal
ARTESIA MORTGAGE: Fitch Holds BB+ Rating on $5.6MM Class G Certs.
BANCCAP ASSET: Fitch Affirms BB Rating on Class M-7 Certificates
BAUSCH & LOMB: Files Prelim Proxy Statement for Pending Merger
BAUSCH & LOMB: S&P Retains BB+ Corp. Credit Rating on Neg. Watch
BCBG MAX: S&P Lowers Corporate Credit Rating to B- from B
BEAR STEARNS: Moody's Affirms Low-B Ratings to Six Certificates
BWAY Corp: Moody's Affirms B1 Corporate Family Rating
BUILDING MATERIALS: Fitch Affirms Issuer Default Rating at BB
CENTENNIAL COMMS: Good Performance Cues S&P to Lift Rating to B
CENTERLINE 2007-1: S&P Rates $34.5 Million Class P Certs. at B-
CHAPARRAL STEEL: Sells Assets to Gerdau Ameristeel for $4.22 Bil.
CHATTEM INC: Earns $14.9 Million in Second Quarter Ended May 31
CHEVY CHASE: S&P Affirms Ratings on 121 Certificate Classes
CMG LEROY: Case Summary & 18 Largest Unsecured Creditors
CREDIT SUISSE: S&P Puts BB+ Rating on $18MM Class CSP-K Certs.
DAE AVIATION: Moody's Rates Proposed $937MM Credit Facility at B2
DEL LABORATORIES: S&P Lifts Corp. Credit Rating to B- from CCC+
DENNINGHOUSE INC: TSX to Delist Shares Effective August 2
DR HORTON: 2007 3rd Quarter Net Sales Orders Drop to $2 Billion
ELDER HEALTH: Moody's Rates Proposed $135MM Credit Facility at B2
ELDER HEALTH: S&P Puts Counterparty Credit Rating at B
FIRST DATA: Michael Capellas Named as Chief Executive Officer
FREEPORT-MCMORAN: Fitch Affirms BB Issuer Default Rating
GALENA STREET: Braddock to Liquidate $300 Million in Assets
GE CAPITAL: S&P Lifts Rating on Class M Certs. to BB+ from BB-
GERDAU AMERISTEEL: Buying Chaparral Steel for $4.22 Bil. in Cash
GO LOGISTICS: Case Summary & 20 Largest Unsecured Creditors
GRAPHIC PACKAGING: Signs $1.7 Billion Merger Pact with Altivity
GREENWICH CAPITAL: Moody's Affirms Low-B Ratings to Six Certs.
GREGG APPLIANCES: Obtains Consents to Amend Indenture on 9% Notes
GREGG APPLIANCES: Prices $111.2 Million 9% Senior Notes Offering
GS MORTGAGE: Fitch Rates $18.907 Mil. Class Q Certificates at B-
ITC^DELTACOM INC: Moody's Rates Corporate Family Rating at B3
JORDYN HOLDINGS: Files Schedules of Assets and Liabilities
JORDYN HOLDINGS: U.S. Trustee Appoints Five-Member Committee
JP MORGAN: Moody's Affirms Low-B Ratings to Six Certificates
KIMBERLITE CDO: Fitch Affirms BB Rating on $22.5MM Class H Notes
LAS VEGAS MONORAIL: Fitch Lowers Rating on $451.4MM Bonds to CC
LEHMAN XS: Moody's Assigns Low-B Ratings to Two Certificates
LEVEL 3: Buys Dublin-based Servecast for $45 Million in Cash
LIVE NATION: S&P Rates $200 Million Sr. Convertible Notes at B
LNR CDO: S&P Puts Low-B Ratings on Three Certificate Classes
NETWORK COMMUNICATIONS: Moody's Affirms B1 Corporate Family Rating
NEW CENTURY: Terminates $150 Million DIP Credit Facility
NEW CENTURY: Completes Sale of Servicing Assets to Carrington
NORTHWEST AIRLINES: Jim Greenwald to Retire Effective July 31
NUTRO PRODUCTS: Notes Redemption Cues S&P to Withdraw Ratings
PAN AMERICAN: Inks Supply Agreement with Allis-Chalmers' DLS Unit
PATRICK FAMILY: S&P Cuts Rating on 2005A Revenue Bonds to BB
PHELPS DODGE: Fitch Upgrades Ratings on Four Senior Notes to BB
POLYONE CORPORATION: Moody's Lifts Corporate Family Rating to B1
R&G FINANCIAL: HUD Strips Mortgage Unit's License to Offer Loans
REALOGY CORP: S&P Lowers Rating and Removes Negative CreditWatch
RONCO CORPORATION: Section 341(a) Meeting Scheduled on August 7
RONCO CORP: Hires Kurztman Carson as Claims and Noticing Agent
SEALY CORP: May 27 Balance Sheet Upside-Down by $144.6 Million
SEARS HOLDINGS: Reports Lower Sales in 9-Week Period Ended July 7
SEARS HOLDINGS: Weak Performance Cues S&P's Negative Outlook
SEQUA CORP: Fitch Puts B+ Issuer Default Rating on Negative Watch
SEQUA CORP: $2.7 Billion Carlyle Deal Cues S&P's Negative Watch
SOUNDVIEW HOME: Fitch Rates $5.7MM Class M-10 Certs. at BB+
STATION CASINOS: S&P Retains Negative Watch on BB- Credit Rating
SUNCOM WIRELESS: Moody's Lifts Corporate Family Rating to Caa1
TIAA CMBS: Fitch Upgrades Rating on Class Certificates to BB
TOUSA INC: Moody's Junks Corporate Family Rating
TOWER AUTOMOTIVE: Court Confirms Chapter 11 Reorganization Plan
TPG-AUSTIN: Moody's Rates Secured Credit Facility at B1
URS CORP: Washington Group Acquisition Waiting Period Expires
VENICE DEV'T: Section 341(a) Creditors Meeting Scheduled Today
VENICE DEV'T: Court Approves Rogers Anderson as Counsel
WR GRACE: Parties Balk at Exclusive Period Extension Plea
WR GRACE: FFIC & U.S. Trustee Give Responses on Washcoat Biz Sale
* Moody's Takes Various Rating Action on Series-2005 Transactions
* Moody's Downgrades Ratings on 399 Mortgage-Backed Securities
* S&P Puts Ratings on 612 Subprime Backed Bonds under Neg. Watch
* Phoenix Management Names John Leach as Director
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
*********
534 LAS AMERICAS: Section 341(a) Meeting Scheduled on July 26
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The U.S. Trustee for Region 7 will convene a meeting of 534 Las
Americas LLC's creditors on July 26, 2007, at 1:00 p.m., at 515
Rusk Suite 3401 in Houston, Texas.
This is the first meeting of creditors required under Section
341(a) of the uses Bankruptcy Code. in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of
the Debtors under oath about the company's financial affairs
and operations that would be of interest to the general body
of creditors.
Headquartered in Houston, Texas, 534 Las Americas LLC owns a
single tract of real estate located at 5909 Glenmont in Houston,
Texas on which it currently operates a 534-unit apartment complex
and formerly rented certain space within the Project to a "charter
school" that was operated by the Houston Independent School
District. The company filed for Chapter 11 protection on June 4,
2007 (Bankr. S.D. Tex. Case No. 07-33778). Peter Johnson, Esq.,
in Houston, Texas, represents the Debtor in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in this case to date. At June 4, 2007, the Debtor's
balance sheet showed total assets of $12,837,888 and total debts
of $9,975,619.
534 LAS AMERICAS: Fannie Mae Objects to Use of Cash Collateral
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Fannie Mae informs the U.S. Bankruptcy Court for the Southern
District of Texas that it objects to 534 Las Americas LLC's use of
its cash collateral.
Fannie Mae contends that it is not adequately protected. Fannie
Mae further contends that the Debtor is not currently generating
any net revenue and unable to occupancy levels in many months and
its budget does not provide for payment of necessary expenses to
sufficiently maintain the property.
The Project
Fannie Mae discloses that the Debtor owns a single tract of real
estate located at 5909 Glenmont in Houston, Texas on which it
currently operates a 534-unit apartment complex and formerly
rented certain space within the Project to a "charter school" that
was operated by the Houston Independent School District ("HISD").
Fannie Mae says that the Debtor's rental of space at the Project
to individual tenants, and previously the Charter School, produces
rental income.
Interim Order
Fannie Mae tells the Court that it had scheduled a non-judicial
foreclosure sale of the Project for June 5, 2007 but was stayed
when 534 Las Americas filed for bankruptcy on June 4.
Fannie Mae reminds the Court that on June 6, 2007, the Debtor
filed the Motion seeking authority under Section 363 of the
Bankruptcy Code to use the Rents to continue operating the Project
and to pay its counsel. On June 11, 2007, the Court held an
emergency hearing on the Debtor's use of the Rents to operate the
property for one month in accordance with the approved budget.
Fannie Mae says that it did not object to the Debtor's use of the
Rents on an interim basis to continue operations of the Project
for the sole purpose of maintaining the health and safety of the
residents and protecting the already declining value of the
Collateral. Fannie Mae relates however, that it reserved all of
its rights with respect to the relief sought at the Emergency
Hearing and in the Motion including, but not limited to, seeking a
determination that the Rents do not constitute cash collateral
because they were not collaterally assigned to Fannie Mae; rather,
they are subject to an absolute assignment under the Pre-
Petition Loan Documents.
Notwithstanding Fannie Mae's reservation of rights, the Debtor
submitted an interim order without any changes to reflect the
reservation and as a result, the Court entered the Interim Order.
Cash Collateral
In its request the Debtor said that it needs to use Fannie Mae and
Arbor Commercial Mortgage LLC's cash collateral for payment of
necessary expenses including, but not limited to payment of
management fees, utilities, maintenance, payroll, equipment
purchases and other routine expenses.
The Debtor assured the Court the Fannie and Arbor are adequately
protected by existing liens on real estate and monthly replacement
liens on the rents. Specifically, the Debtor will:
a. pay monthly cash payments in the amount equal to 75% of
the net revenue after payment of expenses.
b. permit Fannie and Arbor's representatives, agents and
employees to access the Debtor's books and records.
c. allow Fannie and Arbor to review and copy all vouchers,
invoices, contracts and other writings relating to any
and all disbursements.
d. deliver a copy of the monthly operating report to Fannie
and Arbor that the Debtor is required to file with the
Court.
In addition, Fannie and Arbor will be granted:
a. post-petition replacement lien on all new rents, contract
rights, general intangibles, furniture, fixtures and
equipment.
b. superpriority claims to secure the use of the cash
collateral.
Headquartered in Houston, Texas, 534 Las Americas LLC owns a
single tract of real estate located at 5909 Glenmont in Houston,
Texas on which it currently operates a 534-unit apartment complex
and formerly rented certain space within the Project to a "charter
school" that was operated by the Houston Independent School
District. The company filed for Chapter 11 protection on June 4,
2007 (Bankr. S.D. Tex. Case No. 07-33778). Peter Johnson, Esq.,
in Houston, Texas, represents the Debtor in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in this case to date. At June 4, 2007, the Debtor's
balance sheet showed total assets of $12,837,888 and total debts
of $9,975,619.
ADELPHIA COMMS: Wants Across Media Settlement Agreement Approved
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Reorganized Adelphia Communications Corp. and its debtor-
affiliates ask the U.S. Bankruptcy Court for the Northern District
of Georgia to approve a stipulated settlement agreement dated
July 9, 2007, among Adelphia Communications Corporation, David M.
Downey, and David E. Lewis, the Chapter 7 Trustee for the estate
of Across Media Networks, LLC.
On Feb. 12, 2001, Mr. Downey, on AMN's behalf, filed a lawsuit
against Adelphia Communications before the U.S. District Court for
the District of Colorado, alleging 14 causes of action against
Adelphia Communications, including breaches of contract, breaches
of fiduciary duties, other tortious conduct, and violations of the
Colorado Securities Act.
In particular, Mr. Downey alleges that AMN's entire value was
lost as a result of Adelphia Communications' "destruction" of
AMN. Mr. Downey seeks recovery of AMN's value from Adelphia
Communications as damages, as well as equitable recharacterization
and subordination. AMN's projected theoretical value, according
to Mr. Downey, is approximately $93,500,000.
On Aug. 10, 2001, AMN filed a petition for bankruptcy relief
under Chapter 11, which was converted a Chapter 7 case on
April 12, 2002. As a result of AMN's bankruptcy, Mr. Downey's
derivative claims in the AMN lawsuit became the property of the
AMN bankruptcy case.
Adelphia Communications disputes each of the AMN's and Mr.
Downey's contentions.
To avoid the expense and delay of further litigation and to fully
settle their dispute, the Parties entered in arm's-length
negotiations and arrived at the terms of the Settlement
Agreement.
The Parties' Settlement Agreement provides that:
-- AMN and Mr. Downey will have an allowed Other Unsecured
Claim for $11,000,000 against Adelphia Communications;
-- In accordance with the ACOM Debtors' Fifth Amended Joint
Plan of Reorganization, AMN and Mr. Downey will receive:
* 151,157 shares of Time Warner Cable Class A Common
Stock; and
* 9,543,623 CVV Series ACC-3 Interests;
-- Adelphia Communications will pre-arrange for the
liquidation of the Time Warner Shares and may pre-arrange
for the immediate liquidation of the CVV Interests;
-- In consideration for a waiver of their rights under the
Plan to receive additional distributions on account of the
Allowed Claim, the ACOM Debtors will pay AMN and Mr. Downey
at least $6,380,000 in cash on account of the Allowed
Claim;
-- AMN and Mr. Downey will release and forever discharge the
ACOM Debtors from all causes of actions and demands,
including AMN's claims in the ACOM Debtors' bankruptcy
cases and the AMN Lawsuit; and
-- The ACOM Debtors will release and forever discharge AMN and
Mr. Downey from all causes of actions and demands,
including the claims they asserted in AMN's bankruptcy
cases and the counterclaims they asserted in the AMN
Lawsuit.
Terence K. McLaughlin, Esq., at Willkie Farr & Gallagher LLP, in
New York, notes that many of the Parties' disputes devolve to a
"he-said-she-said" proposition, which entails great risk for the
ACOM Debtors. "The risk is magnified given the potentially
substantial damages that could be imposed if the [District] Court
were to find in favor of AMN and Mr. Downey," Mr. McLaughlin
relates.
The ACOM Debtors aver that the Settlement Agreement is both fair
and reasonable, particularly in light of the wide spectrum of
possible outcomes and the factual dispute over liability issues
making pre-trial resolution unlikely.
About Adelphia Comms
Based in Coudersport, Pennsylvania, Adelphia Communications
Corporation (OTC: ADELQ) -- http://www.adelphia.com/-- is a cable
television company. Adelphia serves customers in 30 states and
Puerto Rico, and offers analog and digital video services,
Internet access and other advanced services over its broadband
networks. The company and its more than 200 affiliates filed for
Chapter 11 protection in the Southern District of New York on
June 25, 2002. Those cases are jointly administered under case
number 02-41729. Willkie Farr & Gallagher represents the Debtors
in their restructuring efforts. PricewaterhouseCoopers serves as
the Debtors' financial advisor. Kasowitz, Benson, Torres &
Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP represent
the Official Committee of Unsecured Creditors.
Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family. In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision LLC. The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642). Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates' chapter 11 cases.
The Court confirmed the Debtors' First Modified Fifth Amended
Joint Chapter 11 Plan of Reorganization on Feb. 13, 2007.
ADVANCED MEDICAL: Bausch & Lomb Bid Cues S&P's Developing Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services said its ratings on Advanced
Medical Optics Inc. remain on CreditWatch with developing
implications given the company's $4.3 billion bid to acquire
Bausch & Lomb Inc. (B&L; BB+/Watch Neg/--). AMO plans to finance
the transaction with about 60% debt and 40% common equity.
"AMO's proposal is subject to the termination of B&L's previously
announced merger agreement with affiliates of Warburg Pincus LLC
and the execution of a definite merger agreement with B&L,"
explained Standard & Poor's credit analyst Cheryl Richer. "AMO's
proposal terms include a 12-month period to close the transaction,
shareholder approvals, and various regulatory approvals."
The developing CreditWatch reflects the potential that S&P will
upgrade or downgrade AMO depending on several factors. While debt
leverage will increase, Standard & Poor's will look at the
trajectory of debt paydown given the combined company's expected
cash generation. In addition, certain portions of B&L's portfolio
could be divested, providing funds for further debt reduction.
The financial risk profile will be analyzed in conjunction with an
assessment of the company's increased scale and breadth of eye
care product offerings. While S&P believe an affirmation of the
current ratings is the most likely rating action, an upgrade or
downgrade cannot be ruled out until further details of the
transaction become known. It is possible but unlikely that other
bidders will surface at this time given the "go-shop" provision
for competing proposals that expired on July 5, 2007. In addition
to a $120 million termination fee, the new bidder would not have
access to B&L information that might be necessary to conduct due
diligence on an acquisition.
AEROFLEX INC: Revised Veritas Offer Cues S&P to Remove Neg. Watch
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Standard & Poor's Ratings Services removed its 'B' corporate
credit rating on Plainview, New York-based Aeroflex Inc. from
CreditWatch, where it was placed with negative implications on
May 30, 2007. The 'B' corporate credit rating is affirmed; the
outlook is negative. The rating action follows a review of a
revised buyout offer for the company from a private equity
consortium led by Veritas Capital.
"At the same time, we assigned our 'B+' bank loan rating and '2'
recovery rating to Aeroflex's proposed $560 million first-lien
credit facilities, consisting of a $60 million revolving credit
and a $500 million term loan," said Standard & Poor's credit
analyst Lucy Patricola. The '2' recovery rating indicates that
lenders can expect substantial (70%-90%) recovery of principal in
the event of payment default. The 'B+' rating is one notch higher
than the 'B' corporate credit rating on Aeroflex. All ratings are
based on preliminary offering statements and are subject to review
upon final documentation.
The ratings reflect the company's niche product positions, high
leverage at inception and nominal cash flow. Partial offsets
include stable operating trends, good revenue visibility, and
barriers to entry protecting the company's markets.
AKRON THERMAL: Court Approves Sasco Hill as Financial Advisor
-------------------------------------------------------------
The United States Bankruptcy Court for the Northern District of
Ohio, Eastern Division, gave Akron Thermal LP permission to employ
Sasco Hill Advisors Inc., as its financial advisor, nunc pro tunc
to June 18, 2007.
As financial advisor, Sasco Hill Advisors Inc. is expected to
provide financial advice by reviewing the Debtor's projections,
cash flow forecasts, customer and supplier relationships and
existing credit facilities.
Specifically, the firm is expected to:
a) perform a review of the Debtor and its businesses and
operations to form the basis of the firm's analysis and
advice in connection with matters that arise in this
bankruptcy;
b) assist the Debtor in developing and analyzing cash flow
forecasts for the Debtor to aid management in monitoring cash
flow requirements over the near term;
c) review and evaluate the financing and liquidity generating
alternatives available to the Debtor and developing
recommendations with respect to the appropriate course of
action available to the Debtor;
d) participate, when requested by the Debtor, as an advisor to
the Debtor in negotiations with principal creditors and
holders of equity interests, including, without limitation,
any committees of creditors or holders of equity interests
appointed by the Court, and other parties involved in the
Bankruptcy;
e) advise and assist the management of the Debtor in making
presentations to the Unites States Bankruptcy Court for the
Northern District of Ohio, Eastern Division, the Committees
and such other parties as the Debtor may designate;
f) prepare proposals to creditors, employees, and other parties
who have significant business or financial relationships with
the Debtor;
g) advise the Debtor concerning alternate opportunities for
mergers or acquisitions, or the sale or disposition of assets
and operations of the Debtor;
h) assist in the preparation of letters, press releases,
proposals, term sheets, contracts and other writing in
connection with the Bankruptcy;
i) provide expert advice and testimony relating to financial
matters in connection with any dispute or litigation
relating to the Bankruptcy;
j) assist the Debtor with the development, analysis, formation,
proposal, negotiation, solicitation, preparation, submission,
confirmation, and implementation of any proposed Plan of
Reorganization; and
k) render other financial, advisory and investment banking
services as the firm and the Debtor may mutually agree.
For their services, the firm will be compensated through:
i) nonrefundable monthly financial advisory fees of:
a. $35,000, with payment payable in full immediately
following the entry of an order by the Court approving
the retention of SHA; and
b. $35,000 on each monthly anniversary until such time as
the retention agreement has expired, in each case, subject
only to the subsequent submission and approval by the
Court of periodic fee applications with respect thereto;
ii) as additional compensation for its services as financial
advisor under the retention agreement, the firm reserves the
right to seek an additional success fee upon the successful
restructuring of the Debtor;
iii) the firm's compensation payable under the retention agreement
and amounts payable pursuant to the indemnification and
contribution and expense reimbursement provisions of the
retention agreement shall be entitled to priority as expenses
of administration under Sections 503(b)(2) and 507(a)(2) of
the Bankruptcy Code;
iv) the Debtor and firm understand and agree that the above
financial advisory services and compensation arrangements do
not encompass investment banking services not specifically
set forth in the retention agreement, such as, but not
limited to, financings, mergers or acquisitions or
divestitures or fairness or other written opinions, or fees
related to such other fees, and that, should the Debtor
require such other investment banking services, then the firm
will be entitled to its customary fees for any financial
advisory or investment banking services; and
v) In addition to the compensation to the firm, the Debtor will
pay to the firm upon its demand from time to time all
reasonable out-of-pocket expenses of SHA incurred in
connection with the rendering of services under the retention
agreement, including, but not limited to, attorney's fees and
accountant's fees; however, SHA shall not incur separate
counsel or accountant's fees without prior written approval
from the Debtor, which approval shall not be unreasonable
withheld.
Jason F. Fensterstock, the firm's founder and managing director,
assures the Court that he does not hold any interest adverse to
the Debtor's estate and is a "disinterested persons" as that term
is defined in Section 101(14) of the Bankruptcy Code.
About Akron Thermal
Headquartered in Akron, Ohio, Akron Thermal LP --
http://www.thermalventures.com/ -- operates a public utility
located in the City of Akron, Ohio, and provides heating services
commercial and residential properties. The company filed for
chapter 11 protection on June 18, 2007 (Bankr. N.D. Ohio Case No.
07-51884) Daniel R. Swetnam, Esq. and Tyson A. Crist, Esq. at
Schottenstein Fox & Dunn Co. LPA represent the Debtor as Counsel.
When the Debtor filed for protection from their creditors, it
listed estimated assets of between $1 million and $10 million and
estimated debts of between $10 million and $50 million. The
Debtor's exclusive period to file a plan expires on Oct. 16, 2007.
ALLIS-CHALMERS: Sees $200MM Add'l Revenues from Pan American Deal
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Allis-Chalmers Energy Inc. reported that DLS Drilling Logistic &
Services Corporation, its wholly-owned subsidiary based in Buenos
Aires, Argentina, has reached a preliminary agreement in principle
with its most significant customer, Pan American Energy LLC, to
supply and operate 17 additional rigs for operation in the Cerro
Dragon area in southern Argentina.
DLS currently has a contract with Pan American in the Golfo San
Jorge area under which it provides 31 rigs, consisting of
9 drilling and 22 service rigs. DLS expects to supply the
additional rigs to Pan American pursuant to an anticipated
amendment to their strategic alliance agreement, which would also
be extended for a new five year term. Allis-Chalmers expects to
invest about $80 million in new equipment under this amended
agreement. Financing is anticipated primarily from DLS's cash
flow from operations and DLS's credit facilities.
The equipment is expected to be delivered in stages throughout
2007 and 2008 with the first of the 14 service rigs to be
delivered in October 2007 and the 3 drilling rigs anticipated to
be delivered in the fourth quarter of 2008.
On a preliminary basis, Allis-Chalmers estimates that the
additional rigs would contribute revenues of about $200 million
over the five year term of the contract amendment.
Micki Hidayatallah, Allis-chalmers' chairman and chief executive
officer, stated, "We are excited about the opportunity to expand
our mutually beneficial relationship with Pan American, our
largest customer in Argentina. We look forward to continuing to
build on our relationships in this region and we appreciate the
confidence Pan American has shown in us by expanding our
association."
About Pan American
Pan American Energy LLC is the second largest oil and gas producer
in Argentina. Also, PAE performs exploration and production
activities in Bolivia. Total FY06 production of 242 thousand
barrels of oil equivalent per day was split 51:49 between oil and
gas. Bolivia represented 23% of proved reserves and 10% of both
production and revenues at FY06. The proved reserve life is
14 years and 60% of reserves are developed. Outside E&P, other
assets include participation in oil transportation, storage and
loading, gas distribution and power generation in Argentina,
Uruguay and Bolivia. Created in 1997 as a Delaware holding
company, PAE is owned 60% by BP and 40% by Bridas. The Argentine
Branch has historically been PAE's primary subsidiary both in
terms of assets and revenues and the entity that assumes most of
the financial debt for the whole group.
About DLS
Through DLS, Allis-Chalmers provides drilling, completion and work
over services in Argentina and Bolivia, and other services such as
drilling and completion fluids. DLS currently operates a fleet of
52 rigs, including 21 drilling rigs, 18 work over rigs and
13 pulling rigs.
About Allis-Chalmers
Allis-Chalmers Energy Inc. (NYSE: ALY) -
http://www.alchenergy.com/-- is a Houston based multi-faceted
oilfield services company. It provides services and equipment to
oil and natural gas exploration and production companies,
domestically in Texas, Louisiana, New Mexico, Colorado, Oklahoma,
Mississippi, Utah, Wyoming, Arkansas, Alabama, West Virginia,
offshore in the Gulf of Mexico, and internationally primarily in
Argentina and Mexico. Allis-Chalmers provides rental services,
international drilling, directional drilling, tubular services,
underbalanced drilling, and production services.
* * *
As reported in the Troubled Company Reporter on June 7, 2007,
Moody's Investors Service upgraded Allis-Chalmers Energy Inc.'s
Corporate Family Rating to B2 from B3, its Probability of Default
Rating to B2 from B3, and its senior unsecured note ratings to B2
(LGD 4, 55%) from B3 (LGD 4, 53%). The rating outlook is stable.
ARTESIA MORTGAGE: Fitch Holds BB+ Rating on $5.6MM Class G Certs.
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Fitch Ratings upgrades this class of Artesia Mortgage CMBS, Inc.'s
commercial mortgage pass-through certificates, series 1998-C1:
-- $8.4 million class F to 'AAA' from 'AA'.
In addition, Fitch affirms these classes:
-- $7.6 million class A-2 at 'AAA';
-- Interest-only class X at 'AAA';
-- $9.3 million class B at 'AAA';
-- $11.2 million class C at 'AAA'
-- $9.8 million class D at 'AAA';
-- $3.3 million class E at 'AAA';
-- $5.6 million class G at 'BB+'.
Fitch does not rate the $4.8 million class NR. Class A-1 has been
paid in full.
The rating upgrade reflects increased credit enhancement as a
result of paydown since Fitch's last rating action in December
2006. As of the June 2007 distribution date, the pool's aggregate
certificate balance was reduced 68% to $60.1 million from
$187.0 million at issuance.
The pool is comprised of 96 small balance loans with an average
loan size of $625,866. As is typical of a small loan transaction,
the pool is diversified by loan size with the largest loan and the
largest five loans representing 2.5% and 10.7%; respectively.
Two loans (2.1%) are currently in special servicing. The largest
specially serviced loan (1.1%) is secured by a retail center
located in Carmichael, CA. The other specially serviced loan (1%)
is secured by a multifamily property located in Tulsa, OK. Both
loans were transferred to the special servicer as a result of
maturity defaults.
Twelve loans (16%) are Fitch loans of concern due to declines in
DSCR and occupancy, including the largest loan (2.5%) in the
transaction. The loan is secured by a multifamily property
located in St. Paul, MN and has a year-end 2006 DSCR of 0.94 times
due to below average rental rates and increased expenses.
BANCCAP ASSET: Fitch Affirms BB Rating on Class M-7 Certificates
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Fitch Ratings has affirmed the ratings on the following mortgage
pass-through certificates of BancCap Asset Securitization Issuance
Corporation, ABS trust issue:
Series 2006-1
-- Classes A-1, A-2 and A-3 at 'AAA';
-- Class M-1 at 'AA';
-- Class M-2 at 'A';
-- Class M-3 at 'BBB+;
-- Class M-4 at 'BBB';
-- Class M-5 at 'BBB-';
-- Class M-6 at 'BB+';
-- Class M-7 at 'BB'.
The affirmations reflect a satisfactory relationship between
credit enhancement and future loss expectations and affect
approximately $142 million of outstanding certificates as of the
June 2007 distribution date.
The underlying collateral in this transaction consists of fixed-
rate and adjustable-rate mortgage loans extended to subprime
borrowers secured by first liens on one- to four-family
residential properties.
A majority of the loans in this trust were originated by Encore
Credit Corp. and Funding America LLC. The loans were sold to
BASIC by BICEP Owner Trust and BICEP Owner Trust II. This
transaction is 14 months seasoned and the pool factor is 69%.
Ocwen Loan Servicing, LLC is the servicer for the loans in this
transaction and is currently rated 'RPS2' by Fitch for subprime
transactions.
As of the June 2007 distribution, the overcollateralization was at
its target of $6,542,640.
BAUSCH & LOMB: Files Prelim Proxy Statement for Pending Merger
--------------------------------------------------------------
Bausch & Lomb has filed a preliminary proxy statement with the
Securities and Exchange Commission for a special meeting of
shareholders to be held to consider Bausch & Lomb's pending merger
agreement with affiliates of Warburg Pincus.
In May 2007, Bausch & Lomb entered into a definitive merger
agreement with Warburg Pincus, pursuant to which Warburg Pincus
agreed to acquire 100% of the outstanding shares of Bausch & Lomb
for $65.00 per share in cash.
The date of the special meeting of shareholders and the record
date for the meeting will be specified in a definitive proxy
statement to be mailed to shareholders following SEC's review of
the preliminary proxy statement.
AMO Offer
On July 5, 2007, Bausch & Lomb disclosed that it is engaged in
discussions with Advanced Medical Optics regarding AMO's 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, $45.00 in cash and $30.00 in AMO
stock.
The Bausch & Lomb Board of Directors, following 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 merger agreement.
AMO has been designated an "excluded party" as defined in the
Warburg Pincus merger 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, so long as AMO remains an
"excluded party" pursuant to the Warburg Pincus 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.
Pending further discussions with AMO, Bausch & Lomb's Board of
Directors, following the recommendation of the Special Committee
of the Board of Directors, 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.
FTC Approval
Reuters relates in a July 10, 2007 report that affiliates of
Warburg Pincus have received U.S. antitrust approval to acquire
Bausch & Lomb.
Citing the U.S. Federal Trade Commission, Reuters says antitrust
authorities completed their review of the deal without taking any
action to block it.
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.
BAUSCH & LOMB: S&P Retains BB+ Corp. Credit Rating on Neg. Watch
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Standard & Poor's Ratings Services said its 'BB+' corporate credit
and senior secured ratings on Bausch & Lomb Inc. remain on
CreditWatch with negative implications in light of the July 5,
2007 acquisition bid by Advanced Medical Optics Inc. AMO's
$4.3 billion proposal exceeds the $3.67 billion bid announced by
Warburg Pincus on May 16. Bausch & Lomb's takeover agreement from
Warburg Pincus allowed it to solicit other bids for 50 days.
Bausch & Lomb's board of directors must now determine if the AMO
offer is superior to its existing pact with Warburg Pincus. In
that event, the transaction is subject to certain closing
conditions, including the approval of AMO and B&L shareholders,
regulatory approvals, and the satisfaction of other customary
closing conditions.
"It is possible but unlikely that other bidders will surface given
the "go-shop" provision for competing proposals, which expired on
July 5, 2007," explained Standard & Poor's credit analyst Cheryl
Richer. "In addition to a $120 million termination fee, the new
bidder would not have access to B&L information that might be
necessary to conduct due diligence on an acquisition."
The degree to which S&P downgrade B&L depends in part on which
bidder succeeds; the addition of AMO's product line would further
diversify B&L's eye care portfolio. In either case, debt leverage
will increase. Standard & Poor's will continue to monitor
developments and refine its ratings as more information emerges.
BCBG MAX: S&P Lowers Corporate Credit Rating to B- from B
---------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on Los Angeles-based BCBG Max Azria
Group Inc. to 'B-' from 'B.' At the same time, S&P placed the
ratings on CreditWatch with negative implications.
"The downgrade follows BCBG's failure to meet our expectations for
financial performance, especially after its 2006 acquisition of
Max Rave," explained Standard & Poor's credit analyst Jackie E.
Oberoi. She went on to state that although BCBG received covenant
waivers through July 31, 2007, because of its inability to file
audited financial statements for 2006, "we believe that EBITDA
will be much lower than anticipated, and that credit ratios will
be impaired."
BEAR STEARNS: Moody's Affirms Low-B Ratings to Six Certificates
---------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 22 classes of
Bear Stearns Commercial Mortgage Securities Trust 2005-TOP20,
Commercial Mortgage Pass-Through Certificates, Series 2005-TOP20
as:
-- Class A-1, $101,019,162, affirmed at Aaa
-- Class A-2, $189,450,000, affirmed at Aaa
-- Class A-3, $176,000,000, affirmed at Aaa
-- Class A-AB, $142,600,000, affirmed at Aaa
-- Class A-4A, $954,956,000, affirmed at Aaa
-- Class A-4B, $130,816,000, affirmed at Aaa
-- Class A-J, $147,699,000, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class B, $15,548,000, affirmed at Aa1
-- Class C, $20,730,000, affirmed at Aa2
-- Class D, $15,547,000, affirmed at Aa3
-- Class E, $28,503,000, affirmed at A2
-- Class F, $18,139,000, affirmed at A3
-- Class G, $18,139,000, affirmed at Baa1
-- Class H, $23,321,000, affirmed at Baa2
-- Class J, $18,138,000, affirmed at Baa3
-- Class K, $5,183,000, affirmed at Ba1
-- Class L, $7,773,000, affirmed at Ba2
-- Class M, $7,774,000, affirmed at Ba3
-- Class N, $2,591,000, affirmed at B1
-- Class O, $2,591,000, affirmed at B2
-- Class P, $5,183,000, affirmed at B3
As of the June 12, 2007 distribution date, the transaction's
aggregate certificate balance decreased by about 1.2% to
$2.07 billion from $2.09 billion at securitization. The
certificates are collateralized by 222 loans, ranging in size from
less than 1% to 5.9% of the pool, with the top 10 loans
representing 35.9% of the pool. The pool includes 16 investment
grade shadow rated loans, representing 29.7% of the pool.
The pool has not realized any losses since securitization and
currently there are no loans in special servicing. Four loans,
representing 1% of the pool, are on the master servicer's
watchlist.
Moody's was provided with partial- or full-year 2006 operating
results for 72% of the pool. Moody's weighted average loan to
value ratio for the conduit component is 101.8%, compared to
103.7% at securitization, resulting in an affirmation of all
classes.
The largest shadow rated loan is the Lakeforest Mall Loan
($121.1 million -- 5.9%), which is secured by the borrower's
interest in a 1.1 million square foot regional mall located in
Gaithersburg, Maryland. The mall is anchored by Sears, J.C.
Penney, Macy's and Lord & Taylor. The in-line space was 89%
occupied as of September 2006, the same as at securitization.
Moody's current shadow rating is Baa3, the same as at
securitization.
The second largest shadow rated loan is the West Towne Mall Loan
($110.5 million -- 5.3%), which is secured by the borrower's
interest in a 916,000 square foot regional mall located in
Madison, Wisconsin. The mall is anchored by J.C. Penney, The
Boston Store and Sears. The in-line space was 90.6% occupied as
of September 2006, compared to 100% at securitization. Moody's
current shadow rating is Baa2, the same as at securitization.
The third largest shadow rated loan is the East Towne Mall Loan
($78.2 million -- 3.8%), which is secured by the borrower's
interest in a 859,000 square foot regional mall located in
Madison, Wisconsin. The mall is anchored by J.C. Penney, The
Boston Store and Sears and the in-line space was 91.1% occupied as
of September 2006, the same as at securitization. Moody's current
shadow rating is Baa3, the same as at securitization.
The fourth largest shadow rated loan is the Park 'N Fly Portfolio
($48 million -- 2.3%), which is secured by four off-airport
parking facilities located in three states. The facilities
contain a total of 8,818 parking spaces. Moody's current shadow
rating is Baa3, the same as at securitization.
The fifth largest shadow rated loan is the 1345 Avenue of the
Americas Loan ($46.8 million -- 2.3%), which is secured by a pari
passu interest in a $513.5 million first mortgage loan secured by
a 1.9 million square foot Class A office building located in New
York City. The property was 98% leased as of September 2006,
compared to 96.2% at securitization. Moody's current shadow
rating is Aaa, the same as at securitization.
The sixth largest shadow rated loan is the 200 Madison Avenue Loan
($45 million -- 2.2%), which is secured by a pari passu interest
in a $90 million first mortgage loan secured by a 667,000 square
foot office building located in New York City. The property was
99.4% occupied as of December 2006, similar to securitization.
Moody's current shadow rating is Aa3, the same as at
securitization.
The seventh largest shadow rated loan is the Depot Business Park
Loan ($41 million -- 2%), which is secured by a 2.3 million square
foot office building located in Sacramento, California. The
property was 88% occupied as of September 2006, compared to 80.4%
at securitization. Although occupancy has increased since
securitization, Moody's original analysis incorporated a
stabilized occupancy level. Moody's current shadow rating is
Baa3, the same as at securitization.
The remaining nine shadow rated loans comprise 5.9% of the pool.
The current shadow ratings, which are the same as at
securitization, are:
i. Fifth & Pine Loan ($28.5 million -- 1.4%) -- Baa3;
ii. Park Avenue Plaza Loan ($19.4 million -- .9%) - Aaa;
iii. 1301 West Highlands Boulevard Loan ($19.3 million -- .9%)
-- Baa3;
iv. 2200 Harbor Boulevard Loan ($12.7 million -- .6%) -- A2;
v. Pride Center Loan ($9.7 million -- .5%) -- Aaa;
vi. Brookstone Apartments Loan ($9.7 million -- .5%) -- Baa3;
vii. 60 East End Avenue Coop Loan ($8.9 million -- .4%) -- Aaa;
viii. Queen's Boulevard Office Loan ($8.5 million -- .4%) -- Baa3
and
ix. 520 East 72nd Street Coop Loan ($6.5 million -- s.3%) --
Aaa.
The top three conduit loans represent 12% of the pool. The
largest conduit loan is the Westin Copley Place Loan
($105 million -- 5.1%), which is a pari passu interest in a
$210 million first mortgage loan secured by a 803-room full
service hotel located in Boston, Massachusetts. RevPAR for
calendar year 2006 was $187.12, compared to $169.27 at
securitization. Moody's LTV is 102.2%, essentially the same as at
securitization.
The second largest conduit loan is the Two Renaissance Square Loan
($85.2 million -- 4.1%), which is secured by a 470,000 square foot
Class A office building located in Phoenix, Arizona. The property
was 98.7% occupied as of September 2006, essentially the same as
at securitization. Moody's LTV is 118.2%, essentially the same as
at securitization.
The third largest conduit loan is the Lawson Commons Loan
($58.3 million -- 2.8%), which is secured by a 436,000 square foot
Class A office building located in St. Paul, Minnesota. The
property was 99.8% occupied as of December 2006, essentially the
same as at securitization. Moody's LTV is 114.2%, essentially the
same as at securitization.
BWAY Corp: Moody's Affirms B1 Corporate Family Rating
-----------------------------------------------------
Moody's Investors Service affirmed the B1 corporate family and
instrument ratings of BWAY Corporation and changed the ratings
outlook to stable from positive.
Moody's took these rating actions:
-- Affirmed $50 million senior secured first lien revolver due
2012, Ba2 (LGD 2 -- 26%)
-- Affirmed $5 million Canadian senior secured first lien
revolver due 2012, Ba2 (LGD 2 -- 26%)
-- Affirmed $190 million senior secured first lien term loan B
due 2013, Ba2 (LGD 2 -- 26%)
-- Affirmed $50 million senior secured first lien term loan C due
2012, Ba2 (LGD 2 -- 26%)
-- Affirmed $200 million 10% senior subordinated notes due 2010,
B3 (LGD 5 -- 86%)
-- Affirmed corporate family rating, B1
-- Affirmed probability of default rating, B1
The ratings outlook is changed to stable.
The change in the ratings outlook to stable reflects the decline
in free cash flow to debt and an expectation that key credit
metrics , while strong for the current rating category, will not
improve sufficiently to warrant an upgrade over the intermediate
term. BWAY incurred increased working capital requirements as the
company's largest customer ceased to fund inventory costs. Free
cash flow to debt and interest coverage are not expected to
improve to a level above the current rating category over the
intermediate term. The company is also heavily concentrated in
the paint market which is expected to decline over the
intermediate term.
The corporate family rating was affirmed at B1 as the company's
competitive profile is strong with a longstanding customer base
that faces barriers to switching suppliers because of BWAY's
leading market positions and the limited number of suppliers in
the metal general line and aerosol containers sectors. BWAY has
customers under contracts with raw material pass thoughts which
allowed the company to maintain stable profitability in spite of
an adverse raw materials cost environment.
Headquartered in Atlanta, Georgia, BWAY Corporation is a leading
North American manufacturer of metal paint and specialty
containers and industrial general line rigid plastic containers
for industrial and consumer products. Revenues for the twelve
months ended April 1, 2007 were about $928 million.
BUILDING MATERIALS: Fitch Affirms Issuer Default Rating at BB
-------------------------------------------------------------
Fitch Ratings has affirmed the following ratings on Building
Materials Holding Corporation:
-- Issuer Default Rating at 'BB';
-- Senior secured debt 'BB+'.
The rating affirmation on the senior secured debt applies to
BMHC's $850 million senior secured credit facilities, including
the company's $500 million secured revolving credit facility.
Fitch has also revised BMHC's Rating Outlook to Negative from
Stable. The Negative Outlook for BMHC reflects the more
challenging outlook for the new home construction market, the
current and expected near-term deterioration in credit metrics for
BMHC, and the risk of the company challenging a number of
financial covenants contained under its secured bank credit
facilities.
The company's financial results have been adversely affected by
the meaningful downturn in the homebuilding market, especially as
the large public builders sharply reduced production of new homes
to balance supply with demand. BMHC's revenues fell 36% while
gross margins for the first quarter of fiscal year 2007 declined
90 bps to 19.8% compared to 20.7% during the first quarter of
fiscal year 2006. Fitch is encouraged that the margins have not
declined more, given the very challenging environment and the
large public builders aggressively negotiating lower prices with
their suppliers. In response to the housing downturn, BMHC is
reducing capital expenditures and is deferring discretionary
capital spending, limiting its acquisition activities and reducing
SG&A expenses by consolidating business infrastructure and
optimizing its staffing levels.
Fitch expects that BMHC's margins and credit metrics will continue
to be under pressure as the housing environment remains difficult
and is unlikely to turn around in the current year. Fitch
projects that 2007 total and single family starts will decline
18.9% and 19.9%, respectively. Fitch is sensitive to the
potential of the company violating financial covenants under its
bank credit facilities. The possibility of the housing downturn
continuing longer and becoming deeper than currently anticipated
could increase the risk of covenant violations and have ratings
implications.
The rating reflects BMHC's diverse range of product and service
offerings, its focus on the large production homebuilders, and the
company's currently strong balance sheet. Risk factors include
the BMHC's exposure to the cyclicality of the homebuilding
industry, possible integration/financing issues related to its
ongoing acquisition program, and the continued consolidation of
BMHC's customer base.
The rating also incorporates BMHC's growth strategy. The company
has grown significantly over the past six years, with revenues
increasing to $3.2 billion in 2006 from $1.1 billion in 2001.
Acquisitions will continue to be a primary strategy for the
company as it grows its business, although Fitch expects that
acquisitions will be limited in the near-term as the company
navigates through the housing downturn.
The company conducts business with 17 of the 25 largest production
homebuilders in 16 of the 25 most significant new home
construction markets in the U.S. The major builders are typically
significant players in many of the largest, often high-growth
metropolitan housing markets. BMHC's focus on the major
homebuilders should benefit the company going forward. The large
public builders have the opportunity to leverage their scale and
capital in the period ahead. These companies should be able to
continue to gain market penetration and grow their businesses.
The past decade has seen consolidation in the distribution
channels of the building products industry. New home sales from
the top 10 U.S. homebuilders increased from approximately 10% of
industry sales in 1993 to over 20% in 2006. Fitch expects more
consolidation in the industry, with the large builders continuing
to principally buy private, midsize companies and to take share
from smaller builders. The continued growth of the large
homebuilders may eventually limit the pricing power of building
products and construction services providers like BMHC. However,
Fitch believes that the continued consolidation of the
homebuilding industry will create a long-term need for broad-based
suppliers like BMHC to enable national homebuilders to lower costs
and reduce logistics complexity in their business. Large builders
are the ones who will value BMHC's services, allowing them to
focus on what they do best.
A key element of the company's business strategy for the past
several years entails shifting its product and service mix from
commodity lumber to value-added manufactured building components
and construction services. Through acquisitions, the company now
delivers a growing range of residential construction services in
key growth markets in the U.S. Distribution of commodity products
still represents about 26% of revenues as of 2006, but is
significantly lower than the 60% contribution from this business
during 2000. The focus on construction services as well as value-
added manufactured building components somewhat lessens the impact
of lumber volatility on the company's margins. During this
current housing downturn, BMHC has also pursued some light
commercial construction projects to help offset a portion of the
drop-off in new residential construction. Additionally, the
acquisition of Davis Brothers Framing, Inc. in 2006 allows the
company to focus somewhat more heavily on mid-rise multifamily
construction, particularly in a land-constrained market like
California.
Founded in 1987, BMHC is one of the largest residential
construction services and building materials companies in the
United States, with annual sales in excess of $3 billion. BMHC
competes in the homebuilding industry through two business
segments: BMC West and SelectBuild Construction (formerly BMC
Construction). With locations in the western and southern United
States, BMC West distributes building products and manufactures
building components for professional builders and contractors.
SelectBuild Construction provides construction services to high-
volume production homebuilders through operations in key growth
markets across the United States.
CENTENNIAL COMMS: Good Performance Cues S&P to Lift Rating to B
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Wall, New
Jersey-based Centennial Communications Corp., including the
corporate credit rating, which was raised to 'B' from 'B-'.
"The upgrade reflects the company's improved operating
performance, especially at its U.S. properties, and the
expectation that this will lead to stronger credit metrics in the
near term," said Standard & Poor's credit analyst Naveen Sarma.
The outlook is stable. Total debt as of Feb. 28, 2007, was about
$2.1 billion.
With sustained improvements in its U.S. markets and stabilization
of its Puerto Rican operations, there are prospects for modest
deleveraging at Centennial, a wireless communications carrier. As
a result, S&P have a more favorable view of the sustainability of
the regional wireless business model. The number of postpaid
subscribers in the U.S. has grown in the high single digits
through the company's third quarter, and monthly average revenue
per subscriber has increased about $4 over the same period,
resulting in service revenue growth in the low-teens area.
In addition, Centennial's Puerto Rican operation has reported two
quarters of improving subscriber growth after a rebranding in
response to intense competition that had slowed customer growth
and kept ARPU flat.
While these positive trends have yet to translate into improved
credit metrics, S&P expect to see high-single-digit revenue and
EBITDA growth for the medium term. Free cash flow generation,
which has been modest at about 1.5% of debt, should improve
modestly to the mid-3% area. In addition, the March 2007
disposition of the Dominican Republic properties, which did not
contribute to cash flow, will help the company to reduce its
leverage modestly to the mid-5x area over the next year, from an
adjusted 6.3x as of Feb. 28, 2007.
CENTERLINE 2007-1: S&P Rates $34.5 Million Class P Certs. at B-
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Centerline 2007-1 Resecuritization Trust's
$985.9 million CDO certificates series 2007-1.
The preliminary ratings are based on information as of July 10,
2007. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect the credit support provided by the
subordinate classes of securities and the geographic and property
type diversity of the mortgaged properties securing the underlying
CMBS collateral. The collateral pool consists of 114 CMBS
tranches from 18 CMBS transactions and three re-REMIC tranches
from one re-REMIC transaction.
Preliminary Ratings Assigned
Centerline 2007-1 Resecuritization Trust
Class Rating Amount Approximate credit
Support
----- ------ ------ ----------------
A1 AAA $276,040,000 72.0%
A2 AAA $51,757,000 66.8%
B AA+ $35,737,000 63.1%
C AA- $30,808,000 60.0%
D A+ $40,666,000 55.9%
E A $41,899,000 51.6%
F A- $43,131,000 47.3%
G BBB+ $36,969,000 43.5%
H BBB $29,575,000 40.5%
J BBB- $34,505,000 37.0%
K BB+ $44,363,000 32.5%
L BB $29,575,000 29.5%
M BB- $29,575,000 26.5%
N B+ $49,292,000 21.5%
O B $34,505,000 18.0%
P B- $34,505,000 14.5%
Q NR $142,957,679 N/A
X AAA $985,859,679 N/A
NR -- Not rated.
N/A -- Not applicable.
CHAPARRAL STEEL: Sells Assets to Gerdau Ameristeel for $4.22 Bil.
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Chaparral Steel Company entered into a definitive agreement to be
acquired by Gerdau Ameristeel Corporation for $86.00 per share in
cash. The merger agreement was unanimously approved by the Boards
of Directors of both companies. The offer price values Chaparral
Steel's equity at $4.22 billion.
"After an extensive review of all options for the company,
Chaparral's Board of Directors has determined that this
transaction creates substantial value for our stockholders," Tommy
A. Valenta, Chaparral's President and Chief Executive Officer,
stated. "Over the past few years, our people have worked hard to
enhance our operations, improve our competitive position, and
transform Chaparral into one of the most profitable steel
companies in the world."
"In addition to delivering significant value to our stockholders
Chaparral will be joining one of the largest and most respected
steel companies in the world," Mr. Valenta added. "Gerdau
Ameristeel shares similar values with our company, including a
focus on profitability, developing a loyal customer base,
providing a safe workplace, and a commitment to quality products.
As part of this new and larger company, we will have a more
diversified product offering that will enhance our ability to
better serve both existing and new customers."
Closing of the transaction is subject to the approval of
Chaparral's stockholders and other customary closing conditions,
including regulatory approvals. The merger is expected to close
later this calendar year.
Goldman, Sachs & Co. acted as the Company's exclusive financial
advisor and Wachtell, Lipton, Rosen & Katz acted as legal advisor.
About Gerdau Ameristeel
Headquartered in Tampa, Florida, Gerdau Ameristeel Corporation --
http://www.gerdauameristeel.com/-- (NYSE:GNA; TSX:GNA.TO) is the
second largest minimill steel producer in North America with
annual manufacturing capacity of over 9 million tons of mill
finished steel products. Through its vertically integrated
network of 17 minimills (including one 50%-owned joint venture
minimill), 17 scrap recycling facilities and 51 downstream
operations (including seven joint venture fabrication facilities),
Gerdau Ameristeel serves customers throughout North America. The
company's products are generally sold to steel service centers, to
steel fabricators, or directly to original equipment manufacturers
for use in a variety of industries, including construction,
automotive, mining, cellular and electrical transmission, metal
building manufacturing and equipment manufacturing. The company
is a subsidiary of Brazil's Gerdau SA.
About Chaparral Steel
Headquartered in Midlothian, Texas, Chaparral Steel Company --
http://www.chapusa.com/-- is the second largest producer of
structural steel products in North America and also a major
producer of steel bar products. It operates two mini-mills, one
located in Midlothian, Texas, and the other located in Dinwiddie
County, Virginia. The company has approximately 1,400 employees
and an annual installed capacity of 2.9 million metric tons.
* * *
As reported in the Troubled Company Reporter on April 30, 2007,
Standard & Poor's Ratings Services revised its outlook on
Midlothian Texas-based Chaparral Steel Co. to developing from
stable and affirmed all of its other ratings, including its 'B+'
corporate credit rating.
CHATTEM INC: Earns $14.9 Million in Second Quarter Ended May 31
---------------------------------------------------------------
Chattem Inc. reported total revenues for the second fiscal quarter
ended May 31, 2007, of $113 million compared to total revenues of
$79.4 million in the prior year quarter, representing a 42%
increase. Net income for the second quarter of fiscal 2007 was
$14.9 million, up 46%, compared to net income of $10.2 million in
the prior year quarter.
Revenue growth for the quarter was driven by sales of the five
brands acquired from Johnson & Johnson, continued growth of the
Gold Bond franchise, up 23%, and strong performance from the
Bullfrog franchise, up 62%, as a result of initial sales of the
Marathon Mist product and the timing of shipments as compared to
the second quarter of fiscal 2006.
Net income in the second quarter of fiscal 2006 included employee
stock option expenses under SFAS 123R or $0.05 per share after
taxes, and legal expenses related to the Dexatrim litigation. As
adjusted to exclude these items, net income in the second quarter
of fiscal 2007 was $17.3 million, up 56%, compared to
$11.1 million in the prior year quarter.
First Six Months Results
For the first six months of fiscal 2007, total revenues were
$213.8 million compared to total revenues of $163.4 million in the
prior year period, representing a 31% increase. Net income in the
first six months of fiscal 2007 was $28.6 million, compared to
$25 million in the prior year period.
As of May 31, 2007, the company's balance sheet showed total
assets of $777.2 million, total liabilities of $598.1 million, and
total stockholders' equity of $179.1 million.
A copy of the company's second quarter 2007 report is available
for free at http://ResearchArchives.com/t/s?2183
"The first six months of fiscal 2007 was a record period for the
company," said Bob Bosworth, president and chief operating officer
of Chattem. "The positive momentum in our business following the
acquisition of five brands from Johnson & Johnson on Jan. 2, 2007,
has continued as evidenced by the strong sales growth and
operating results for the first half of fiscal 2007. Sales growth
in the six months was driven by the five acquired brands,
continued expansion of the Gold Bond(R) franchise, the growth of
Icy Hot(R) led by the launch of Icy Hot Heat Therapy and the
introduction of Bullfrog(R) Marathon Mist. The integration of the
acquired brands is on schedule and we have successfully leveraged
our infrastructure during this period resulting in incremental
earnings growth. Also, the company has effectively managed its
capital structure by the issuance of $100 million of 1.625%
convertible debt issued on April 11, 2007, and borrowings under
the revolving credit facility. Additionally, the company has
significantly reduced total debt outstanding by about $35 million
since the date of the acquisition of the J&J brands."
"We are extremely pleased with the Company's performance in the
quarter, with total revenues up 42%, adjusted earnings per share
up 56% and EBITDA up an impressive 73%," said Zan Guerry, chief
executive officer of Chattem. "ACT(R), Cortizone-10(R) and
Unisom(R) continue to respond very well to advertising, with each
brand performing strongly at retail. Moreover, the Gold Bond
franchise continued its impressive growth at retail during this
period, Icy Hot experienced renewed growth led by recently
introduced line extensions and Bullfrog performed well with the
Marathon Mist product. Given these positive results and the
strength of our business, we remain very excited about the
company's prospects for the balance of fiscal 2007 and beyond."
Brand Acquisition
On May 25, 2007, the company closed the previously announced
agreement to acquire the ACT business in Western Europe together
with worldwide trademark rights to ACT from Johnson & Johnson for
$4.1 million in cash plus certain assumed liabilities. Chattem
funded the acquisition with existing cash.
About Chattem
Based in Chattanooga, Tennessee, Chattem Inc. (NASDAQ: CHTT) --
http://www.chattem.com/-- manufactures and markets a variety of
branded consumer products, including over-the-counter healthcare
products and toiletries and skin care products. The company's
products include Gold Bond medicated powder, Icy Hot topical
analgesic, Dexatrim appetite suppressant, and Bullfrog sunblock.
Chattem has operations in the U.K., Australia, and Puerto Rico.
* * *
Chattem Inc. carries Moody's Investors Service's Ba3 corporate
family rating and B2 senior subordinated rating.
The company also carries Standard & Poor's Ratings Services' 'BB-'
corporate credit rating. Outlook on the company is stable.
CHEVY CHASE: S&P Affirms Ratings on 121 Certificate Classes
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on 10
classes of mortgage-backed certificates from Chevy Chase Funding
LLC's series 2003-3, 2003-4, 2004-1, 2004-2, and 2004-A. At the
same time, S&P affirmed its ratings on 121 classes from 19 Chevy
Chase Funding LLC transactions, including those with raised
ratings.
The upgrades reflect positive collateral performance that had
significantly increased current and projected credit support
levels for the upgraded classes as of the May 2007 remittance
period. Significant principal prepayments and the shifting
interest structure of the transactions have allowed the level of
available credit support to build. At the new rating levels, the
projected credit support multiples for the upgraded classes range
from 2.27x to 2.89x the original percentages. Total delinquencies
to date have been low, ranging from 1.72% for series 2004-2 and
4.95% for series 2003-4. Cumulative losses to date are 0.00% for
10 of the 19 transactions and nine deals have experienced
cumulative losses ranging from 0.01% to 0.06%.
The affirmations reflect actual and projected credit support
levels that are sufficient to maintain the current ratings.
In January 2007, The U.S. District Court for the Eastern District
of Wisconsin found that Chevy Chase Bank FSB had violated the
Truth in Lending Act in several respects in connection with its
adjustable-rate mortgage loans. The District Court also granted
the plaintiff's motion for class certification for certain people
described in the court's order and held that the plaintiffs and
people in the class could, at their option, choose to rescind
their mortgage loans with Chevy Chase. The U.S. Court of Appeals
for the Seventh Circuit has agreed to hear Chevy Chase's appeal
from the District Court's class certification. Chevy Chase has
informed us that it believes that a decision will be delivered by
the Court of Appeals in the fall of 2007 and the Bank expects to
prevail. It is believed that this court case will not have an
impact on any of the Chevy Chase trusts. S&P will continue to
monitor these legal proceedings involving Chevy Chase closely.
These transactions utilize a senior subordinate structure; each
class is supported by the rated and unrated classes subordinate to
it. The underlying collateral for these transactions consists
primarily of prime, 30-year, negatively amortizing, adjustable-
rate mortgage loans secured by first liens on one- to four-family
residential properties.
Ratings Raised
Chevy Chase Funding LLC
Rating
------
Series Class To From
------ ----- -- ----
2003-3 B-1 AA+ AA
2003-3 B-2 A+ A
2003-4 B-1 AA+ AA
2003-4 B-2 A+ A
2004-1 B-1 AA+ AA
2004-1 B-2 A+ A
2004-2 B-1 AA+ AA
2004-2 B-2 A+ A
2004-A B-1 AA+ AA
2004-A B-2 A+ A
Ratings Affirmed
Chevy Chase Funding LLC
Series Class Rating
------ ----- ------
2003-3 A-1, A-2, A-NA, IO AAA
2003-3 B-3 BBB
2003-3 B-4 BB
2003-3 B-5 B
2003-4 A-1, A-2, A-NA, IO AAA
2003-4 B-3 BBB
2003-4 B-4 BB
2003-4 B-5 B
2004-1 A-1, A-2, A-NA, IO AAA
2004-1 B-3 BBB
2004-1 B-4 BB
2004-1 B-5 B
2004-2 A-1, A-2, A-NA, IO AAA
2004-2 B-3 BBB
2004-2 B-4 BB
2004-2 B-5 B
2004-3 A-1, A-2, A-NA, IO AAA
2004-3 B-1 AA
2004-3 B-2 A
2004-3 B-3 BBB
2004-3 B-4 BB
2004-3 B-5 B
2004-4 A-1, A-2, A-NA, IO AAA
2004-4 B-1 AA
2004-4 B-2 A
2004-4 B-3 BBB
2004-4 B-4 BB
2004-4 B-5 B
2004-A A-1, A-NA, IO AAA
2004-A B-3 BBB
2004-A B-4 BB
2004-A B-5 B
2004-B A-1, A-NA, IO AAA
2004-B B-1 AA
2004-B B-2 A
2004-B B-3 BBB
2004-B B-4 BB
2004-B B-5 B
2005-1 A-1, A-2, A-NA, IO, NIO AAA
2005-1 B-1, B-1NA AA
2005-1 B-2 A
2005-1 B-3 BBB
2005-1 B-4 BB
2005-1 B-5 B
2005-2 A-1, A-2, A-NA, IO, NIO AAA
2005-2 B-1, B-1NA AA
2005-2 B-2, B-2NA A
2005-2 B-3 BBB
2005-2 B-4 BB
2005-2 B-5 B
2005-3 A-1, A-2, A-NA, IO, NIO AAA
2005-3 B-1, B-1NA AA
2005-3 B-2, B-2NA A
2005-3 B-3 BBB
2005-3 B-4 BB
2005-3 B-5 B
2005-4 A-1, A-2, A-NA, IO, NIO AAA
2005-4 B-1, B-1NA AA
2005-4 B-2, B-2NA A
2005-4 B-3 BBB
2005-4 B-4 BB
2005-4 B-5 B
2005-A A-1, A-2, A-NA, IO, NIO AAA
2005-A B-1, B-1NA AA
2005-A B-2, B-2NA A
2005-A B-3 BBB
2005-A B-4 BB
2005-A B-5 B
2005-B A-1, A-2, A-NA, IO, NIO AAA
2005-B B-1, B-1NA AA
2005-B B-2, B-2NA A
2005-B B-3 BBB
2005-B B-4 BB
2005-B B-5 B
2005-C A-1, A-2, A-NA, IO, NIO AAA
2005-C B-1, B-1NA AA
2005-C B-2, B-2NA A
2005-C B-3 BBB
2005-C B-4 BB
2005-C B-5 B
2006-1 A-1, A-2, A-NA, IO, NIO AAA
2006-1 B-1, B-1NA AA
2006-1 B-2, B-2NA A
2006-1 B-3 BBB
2006-1 B-4 BB
2006-1 B-5 B
2006-2 A-1, A-2, A-NA, IO, NIO AAA
2006-2 B-1, B-1NA AA
2006-2 B-2, B-2NA A
2006-2 B-3 BBB
2006-2 B-4 BB
2006-2 B-5 B
2006-3 A-1, A-2, A-NA, IO, NIO AAA
2006-3 B-1, B-1NA AA
2006-3 B-2, B-2NA A
2006-3 B-3, B-3NA BBB
2006-3 B-4 BB
2006-3 B-5 B
2006-4 A-1, A-2, A-NA, IO AAA
2006-4 NIO AAA
2006-4 B-1, B-1NA AA
2006-4 B-2, B-2NA A
2006-4 B-3, B-3NA BBB
2006-4 B-4 BB
2006-4 B-5 B
CMG LEROY: Case Summary & 18 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: C.M.G Leroy, Inc.
136 West Main Street
Le Roy, NY 14482
Bankruptcy Case No.: 07-02777
Chapter 11 Petition Date: July 10, 2007
Court: Western District of New York (Buffalo)
Debtor's Counsel: David S. Stern, Esq.
Elliott, Stern, & Calabrese LLP
One East Main Street, 10th Floor
Rochester, NY 14614
Tel: (585) 232-4724
Fax: (585) 232-6674
Total Assets: $644,497
Total Debts: $1,776,812
Debtor's List of its 18 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Keybank National Association 136 West Main $1,286,219
P.O. Box 94831 Street, Le Roy, NY Secured:
Cleveland, OH 44101 $300,000
First Niagara Bank Lease $153,780
6950 South Transit Road
Lockport, NY 14095
Advance Restaurant Business $71,856
Finance LLC
600 TownPark Lane, Suite 500
Kennesaw, GA 30144
Manufacturers and Traders Judgment-Business $56,186
Trust Company
Well Fargo Financial Business Line $21,496
Bank of America Credit Card $17,914
Maines Food & Paper Food & Paper Products $16,817
Rewards Network, Inc. Cash Advance $15,000
Hess Energy New York Lawsuit $8,495
Able Electric Mechanics Lean $5,025
National Grid Utility Bill $3,812
RG&E Utility Bill $2,375
LP Graphics Graphics $1,715
Dumac Business Systems, Inc. $1,307
Sign & Lighting Services LLC Lighting Services $652
KJ's Lawn Service Lawn Care $375
Mother Natures' Enterprises Window Cleaning $292
ABC Glass Glass Service $180
CREDIT SUISSE: S&P Puts BB+ Rating on $18MM Class CSP-K Certs.
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Credit Suisse First Boston Mortgage Securities Corp.'s
$1.522 billion commercial mortgage pass-through certificates
series 2007-TFL2.
The preliminary ratings are based on information as of July 10,
2007. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying mortgage loans, and the
geographic and property type diversity of the loans. Standard &
Poor's analysis determined that, on a weighted average basis, the
trust pool has a debt service coverage of 1.19x based on a
weighted average stressed constant of 10.16%, and a beginning and
ending LTV of 63.9%.
Preliminary Ratings Assigned
Credit Suisse First Boston Mortgage Securities Corp.
Class Rating Amount Recommended credit
Support
----- ------ ------ -----------------
A-1 AAA $630,500,000 48.256%
A-2 AAA $210,300,000 30.997%
A-X-1* AAA $1,128,749,126 N/A
A-X-2* AAA $89,738,688 N/A
B AA+ $45,700,000 27.247%
C AA $42,600,000 23.751%
D AA- $33,500,000 21.001%
E A+ $36,600,000 17.998%
F A $36,500,000 15.002%
G A- $33,500,000 12.253%
H BBB+ $39,600,000 9.003%
J BBB $36,600,000 5.999%
K BBB- $39,600,000 2.749%
L BBB- $33,500,000 0.000%
BSL-A NR $8,900,000 N/A
BSL-B NR $9,000,000 N/A
BSL-C NR $8,900,000 N/A
BSL-D NR $8,900,000 N/A
BSL-E NR $7,900,000 N/A
BSL-F NR $9,900,000 N/A
CSP-A1 AAA $101,000,000 N/A
CSP-A2 AAA $33,600,000 N/A
CSP-B AA+ $10,600,000 N/A
CSP-C AA $11,500,000 N/A
CSP-D AA- $9,900,000 N/A
CSP-E A+ $10,000,000 N/A
CSP-F A $9,700,000 N/A
CSP-G BBB+ $19,900,000 N/A
CSP-H BBB $9,900,000 N/A
CSP-J BBB- $15,900,000 N/A
CSP-K BB+ $18,000,000 N/A
CSP-AX* AAA $250,000,000 N/A
*Residual class.
N/A -- Not applicable.
NR -- Not rated.
DAE AVIATION: Moody's Rates Proposed $937MM Credit Facility at B2
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 first time rating to DAE
Aviation Holdings, Inc. proposed $937 million senior secured
credit facility consisting of a $557 million term loan due 2014, a
$100 million revolver due 2013 and a $280 million asset sale
facility due 2009.
Also, Moody's assigned a Caa2 rating to the company's proposed
$325 million senior unsecured notes due 2015 and a B3 Corporate
Family Rating. The rating outlook is stable.
The purpose of the proposed notes and credit facilities is to
partially fund the acquisition of the company by Dubai Aerospace
Enterprises LTD. In April of 2007, Dubai Aerospace Enterprises
entered into an Agreement and Plan of Merger to acquire Standard
Aero Holdings, Inc. and Piedmont/Hawthorne Holdings, Inc. (d/b/a
Landmark Aviation) from the Carlyle Group for about $1.9 billion
in cash.
This acquisition represents the first investment by Dubai-based
DAE, which was created in February 2006 with the intent to build a
global aerospace, manufacturing and services corporation. Both
the Standard Aero and Landmark businesses will be placed into the
DAE Engineering business segment as wholly-owned subsidiaries of
DAE Aviation.
The ratings reflect very high leverage that ensues from the heavy
amount of debt used to finance the acquisition of Standard Aero
and Landmark by DAE, along with weak interest coverage and free
cash flow levels expected over the near term. The ratings also
consider weak margins and recent operating problems encountered by
the acquired companies, and the uncertainty involving the on-going
recovery of both Standard Aero and Landmark in their respective
businesses.
Key credit metrics are initially weak for the B3 rating, but
should improve with anticipated debt reduction. Moreover, the B3
CFR considers integration risk and possible additional leverage
that may be associated with future acquisitions that DAE Aviation
may undertake in the near- to medium term. However, much of this
risk is offset by the likely reduction in debt that should ensue
over the shorter-term from the planned sale of Landmark's current
Fixed Base Operations business.
The stable rating outlook reflects Moody's expectations that the
company's profit margins will improve from the prior year's levels
experienced at both Standard Aero and Landmark, and that new
management will successfully integrate the operation of both
entities while experiencing a small level of cost savings through
scale-related synergies. The stable outlook further assumes the
successful sale of the FBO business within the next 12 months,
with proceeds at least equal to the $280 million outstanding on
the asset sale facility, and that the company will only have
temporary minimal, if any, borrowings under its revolving credit
facility.
Ratings or their outlook could be subject to downward revision if
the company's margins were to deteriorate or if sales levels were
to fall as a result of slowing market conditions or the unexpected
loss of a large contract, or if the company were to increase debt
substantially for any reason, for large leveraged acquisitions or
for a distribution to shareholders in particular. In addition,
the failure of the company to sell its FBO business over the next
two years for the sales price anticipated could also result in
downward rating actions. These credit metrics could prompt a
downgrade or negative outlook: Debt/EBITDA in excess of 10 times,
EBIT/Interest of less than 0.7 times, or negative retained cash
flow over an extended period.
Ratings or their outlook could be raised if the company were to
repay a substantial amount of debt, or if it could demonstrate
sustained margin improvement during a period of robust sales
growth, resulting in the Debt/EBITDA of below 6.5 times,
EBIT/Interest in excess of 1.5 times, and retained cash flow in
excess of 8% of total debt with positive free cash flow sustained
over a prolonged period.
These ratings are assigned:
DAE Aviation Holdings, Inc.:
-- Senior secured credit facilities at B2 (LGD3, 35%)
-- Senior unsecured notes at Caa2 (LGD5, 87%)
-- Corporate Family Rating of B3
-- Probability of Default Rating of B3
DAE Aviation Holdings, Inc., a Delaware corporation that is a
100%-owned subsidiary of Dubai Aerospace Enterprises LTD, is a
leading provider of Maintenance, Repair and Overhaul, Airport
Fixed Base Operations, and Aircraft Completion & Modification
services to the regional, business, military and general aviation
industries with facilities located throughout North America.
DEL LABORATORIES: S&P Lifts Corp. Credit Rating to B- from CCC+
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Del Laboratories Inc. to 'B-' from 'CCC+', and raised
the rating on the company's senior secured floating-rate debt to
'B' from 'B-'; the recovery rating, which was not on CreditWatch,
was affirmed at '2', indicating the expectation for substantial
recovery (70%-90%) of principal in the event of a payment default.
Standard & Poor's also raised ratings on the company's senior
subordinated notes to 'CCC' from 'CCC-'. The ratings were removed
from CreditWatch with developing implications, where they were
placed on June 26, 2007, as a result of the trustees' notification
that a default had occurred under the indentures for the company's
$185 million senior secured floating-rate notes due 2011 and its
$175 million 8% senior subordinated notes due 2012. The outlook
is stable. As of March 31, 2007, Uniondale, New York-based Del
had approximately $379 million of total reported debt outstanding.
"The rating action is based on the company satisfying the default
notification declared by the trustees for the company's senior
secured and subordinated note indentures," said Standard & Poor's
credit analyst Mark Salierno.
On July 6, 2007, the company filed its first-quarter 2007 Form
10-Q (ended March 31, 2007) before the expiration of the 30-day
grace period. The company has also demonstrated improved
operating performance and maintained adequate liquidity in recent
quarters which provides further support to the rating action.
"While the company's credit measures and liquidity remain
appropriate for the revised rating, we remain concerned about its
internal controls and financial reporting systems," said
Mr. Salierno. As a result, the revised rating and outlook do not
provide for further internal control issues and assume the company
will file its financial statements on a timely basis going
forward.
The ratings reflect Del's highly leveraged financial risk profile,
somewhat narrow product focus, and highly competitive operating
environment in the segments in which it competes. These factors
are partly offset by its leading consumer brands in both nail care
and oral analgesics.
DENNINGHOUSE INC: TSX to Delist Shares Effective August 2
---------------------------------------------------------
TSX was prevented from initiating or continuing delisting
proceedings against Denninghouse Inc. as a result of a stay of
proceedings issued under the Companies' Creditors Arrangement Act
by the Ontario Superior Court of Justice on Aug. 16, 2004.
TSX has been advised that all of the underlying assets and
business of the company have been sold, the net proceeds in
respect of those assets have been distributed to the creditors and
that the stay of proceedings expired on June 30, 2007.
The common shares of the company will be suspended from trading
immediately for failure to meet the continued listed requirements
of TSX. The company will be delisted at the close of market on
August 2, 2007.
Denninghouse Inc. (TSE:DEH) operates and franchises discount fixed
price point stores, traditionally known as dollar stores,
primarily under the banner of Buck or Two and Dollar ou Deux. The
company's stores offer customers a variety of general merchandise
at low fixed dollar price points of $1.00, $1.50 or $2.00 and
multiples thereof. Categories of merchandise include hardware,
household items and baby products. At January 31, 2004,
Denninghouse operated 325 stores in 10 provinces in Canada,
comprising 231 franchised locations and 94 company-owned outlets.
DR HORTON: 2007 3rd Quarter Net Sales Orders Drop to $2 Billion
---------------------------------------------------------------
D.R. Horton Inc. reported net sales orders for the third quarter
ended June 30, 2007 of 8,559 homes or approximately $2.0 billion,
compared to 14,316 homes or approximately $3.8 billion for the
same quarter of fiscal year 2006.
Net sales orders for the first nine months of fiscal year 2007
totaled 27,313 homes or approximately $6.9 billion, compared to
41,550 homes, approximately $11.4 billion, for the same period of
fiscal year 2006. The company's cancellation rate for the third
quarter of fiscal 2007 was 38%.
Donald R. Horton, Chairman of the Board, said, "Market conditions
for new home sales declined in our June quarter as inventory
levels of both new and existing homes remained high, and we expect
the housing environment to remain challenging. We adjusted our
sales prices as selling conditions deteriorated, and we continue
to react quickly to market dynamics. We expect to report a profit
from operations before impairments for the June 30, 2007 quarter.
However, as a result. . . , we will realize significant asset
impairments which will result in a loss for both the quarter and
the nine months ended June 30, 2007."
Headquartered in Fort Worth, Texas, D.R. Horton Inc. (NYSE:DHI)
-- http://www.drhorton.com/-- is engaged in the construction and
sale of high quality homes with sales prices ranging from $90,000
to over $900,000. D.R. Horton also provides mortgage financing
and title services for homebuyers through its mortgage and title
subsidiaries.
* * *
DR Horton Inc. carries to date Fitch's BB+ subordinated debt
rating, which was placed on Jan. 29, 2004. In addition, the
company still carries Moody's Ba1 senior subordinate rating, which
was placed on Nov. 11, 2005.
ELDER HEALTH: Moody's Rates Proposed $135MM Credit Facility at B2
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 senior debt rating to
Elder Health, Inc.'s proposed $135 million senior secured bank
credit facility, which consists of a $125 million six year term
loan and a $10 million five year revolving credit facility.
In conjunction with this rating, Moody's also assigned a B2
corporate family rating to Elder Health and a Ba2 insurance
financial strength rating to Elder Health's main operating
subsidiary, Elder Health Pennsylvania, Inc. The outlook on the
ratings is stable.
According to Moody's, the proceeds will be used to fund an asset
purchase of the membership and related provider contracts of
Senior Partners, the Medicare Advantage line of business of Health
Partners of Philadelphia, Inc. The company also expects an
additional equity contribution from existing investors to comply
with state regulatory requirements and provide additional
liquidity at the parent level.
The rating agency said that the company's ratings reflect Elder
Health's small membership base of less than 50,000 members, its
concentration in the Medicare Advantage segment, its historically
low earnings margins, its low capitalization level and the
resulting high financial leverage as a result of the proposed
acquisition.
The addition of about 22,000 members in Elder Health's core
Philadelphia County market as a result of the acquisition will
increase the company's market share to over 30% of Medicare
Advantage enrollees and provide the company increased negotiating
leverage with providers. New management has also instituted an
increased focus on utilization management to help control costs.
Financial integration issues for the new membership should be
minimal, as Elder Health will only be responsible for claims
incurred after the acquisition is complete. With respect to
operational issues, the company has implemented an extensive
transition process over the last 12 months, including contracting
with Health Partner's provider network to allow for minimal
disruption.
Moody's notes that while current reimbursement levels and market
conditions are favorable in the Medicare Advantage market, there
are risks associated with this business. The chief concern is the
uncertainty of the future level of reimbursements, as budgetary
and political pressures could change the government's perspective
towards the Medicare program.
Moody's stated that with the issuance of the new debt, the
adjusted financial leverage is projected to be about 2.5x by the
end of 2007 with earnings coverage of about 4.6 times. The rating
agency notes, however, that with its small membership base,
concentration in the Philadelphia area, and lack of product
diversity, the company's earnings could be subject to sharp
fluctuations. The ratings assume there are no substantive
reductions to Medicare Advantage reimbursement rates and that the
company maintains its current Medicare contracts with CMS.
The rating agency stated that the ratings could move up if NAIC
RBC rises above 150% of company action level, debt to EBITDA falls
below 2x, EBITDA to interest expense exceeds 6x, and annual net
income margins are at least 2%. However, if there is a loss or
impairment of one or more of Elder Health's Medicare contracts,
EBITDA to interest expense falls below 3x, membership decreases in
any 12 month period by 10% or more, if the overall annual medical
loss ratio increases above 85%, or if there are indications of
integration problems with the acquired membership then Moody's
said the ratings could be lowered.
These ratings were assigned with a stable outlook:
Elder Health, Inc.
-- senior secured debt rating of B2;
-- corporate family rating of B2;
Elder Health Pennsylvania, Inc.
-- insurance financial strength rating of Ba2.
Moody's health insurance financial strength ratings are opinions
about the ability of life and health insurance companies to
punctually repay senior policyholder claims and obligations.
Moody's corporate family rating is an opinion of a corporate
family's ability to honor all of its financial obligations and is
assigned to a corporate family as if it had a single class of debt
and a single consolidated legal entity structure.
Elder Health is headquartered in Baltimore, Maryland. For 2006,
total revenue was $347 million with medical membership of 24,242.
As of Dec. 31, 2006 the company reported shareholder's equity of
$47 million. The senior partners business of Health Partners of
Philadelphia had 2006 revenues of about $272 million and 22,000
medical members.
ELDER HEALTH: S&P Puts Counterparty Credit Rating at B
------------------------------------------------------
Standard & Poor's Rating Services assigned its single 'B'
counterparty credit rating on Elder Health Inc. The outlook is
stable.
At the same time, Standard & Poor's assigned its single 'B' bank
loan rating to Elder Health's proposed $135 million senior secured
bank facilities, consisting of a $125 million term loan due 2013
and a $10 million revolving credit facility due 2012. The
facilities are rated the same as the corporate credit rating on
Elder Health.
"The ratings reflect Elder Health's concentrated geographic and
product profile, high level of intangibles relative to equity, and
relatively high financial leverage based upon debt to
capitalization," said Standard & Poor's credit analyst Hema Singh.
"Favorable offsetting factors include a good near-term pro forma
earnings profile, our expectation for improved prospective cash
flow, and senior management expertise."
The proceeds of the loan will be used primarily to finance the
purchase of Medicare HMO membership (22,000) from Health Partners
of Philadelphia. The acquisition is structured as an asset
purchase, and all pretransaction claim obligations will remain
with the seller. The purchase price will be allocated mainly to
intangibles, and is expected to be amortized over a three-to-five-
year period.
Elder Health provides comprehensive health benefits to more than
26,000 members, most of whom reside in Philadelphia, Pennsylvania.
Elder Health also provides prescription drug plan coverage to an
additional 40,000 members in various states.
Standard & Poor's expects Elder Health to remain focused on
managing the medical risk of its affiliated health plans and
maintaining efficient operations. Elder Health's number-two
market presence in its core Philadelphia market will facilitate
its competitiveness and enable the company to grow. The outlook
reflects Standard & Poor's expectation for Elder Health to sustain
its earnings profile and prudently manage its overall growth
objectives, including the migration of Senior Partners membership
into its Philadelphia-based health plan.
"By year-end 2007, we expect that Elder Health's revenue will be
in the range of $650 million-$700 million and for the company to
serve 45,000-50,000 Medicare Advantage members," said Ms. Singh.
FIRST DATA: Michael Capellas Named as Chief Executive Officer
-------------------------------------------------------------
First Data Corp. reported that Michael D. Capellas will become
chief executive officer following completion of the acquisition of
the company by an affiliate of Kohlberg Kravis Roberts & Co.
Mr. Capellas will succeed Henry C. Duques who has served as
chairman and CEO since November 2005, and previously served as
chairman from 1989 to 2003 and CEO from 1989 to 2002. Mr. Duques
announced his intention to retire within two years when he
returned to the chairman and CEO roles in late 2005.
Prior to completion of the KKR transaction, Mr. Capellas will be
working closely with KKR and the First Data management team.
Mr. Capellas is a widely respected executive in technology-related
and other industries. Most recently, he served as CEO of MCI Inc.,
formerly Worldcom, from 2002 until its acquisition by Verizon in
2006, and Chairman from 2002 to 2004. He also served as CEO of
Compaq Computer Corporation from 1999 to 2002, and chairman from
2000 to 2002. He subsequently served as president of Hewlett-
Packard Company following the acquisition of Compaq by Hewlett-
Packard. Since 2006, Mr. Capellas has served as a senior advisor
to Silver Lake Partners, an investment firm focused on investments
in technology-related industries.
Scott C. Nuttall, a Member of KKR, said: "We are delighted to have
recruited a world-class executive like Michael Capellas to become
CEO of First Data. [Mr. Capellas] has a strong track record for
vision, innovation and value creation in large technology-related
businesses and is ideally suited for this position. We are
confident that he will deepen customer relationships, and his
leadership will be characterized by the same excitement and
passion for success that he brought to his previous companies."
Mr. Capellas said: "As a leading provider of electronic commerce
and payment solutions for financial institutions, merchants and
other organizations throughout the world, First Data has had a
tremendous heritage for success. I look forward to joining First
Data at this pivotal time and believe the company is uniquely
positioned to pioneer innovative technologies for the next-
generation of electronic and mobile commerce around the world."
Ric Duques, chairman and CEO of First Data, said: "[Mr. Capellas]
is by any measure an accomplished, energetic and visionary CEO and
I will be stepping down with the utmost confidence that he will be
leading this great company to an even brighter future. Under [Mr.
Capellas]'s leadership, I am certain that the company will find
more innovative ways to grow First Data's powerful competitive
position in the electronic payment and merchant markets, as well
as its rapidly expanding international business."
James D. Robinson III, chairman of First Data's executive
committee, said: "We are very pleased to attract Michael Capellas
and his extraordinary track record for success to First Data. We
would also like to thank Ric Duques for his many years of
dedicated service to First Data. He has been the driving force
behind making First Data the great company that it is today, and
we want to wish [Mr. Duques] a fulfilling retirement."
Mr. Capellas joined Compaq in 1998 as chief information officer
and also served as chief operating officer before being named CEO.
Prior to joining Compaq, he served in senior-level positions with
Oracle Corporation and SAP AG and in a variety of technology and
financial positions with Schlumberger Ltd. Mr. Capellas received
a bachelor of business administration degree from Kent State
University. He is a member of the Board of Directors of Cisco
Systems Inc. and serves on the national board of the Boys and
Girls Club of America.
It is expected that KKR's acquisition of First Data will be
completed by the end of the third quarter of 2007, subject to the
approval of First Data shareholders, regulatory approvals and
customary closing conditions.
About First Data
First Data Corp. (NYSE: FDC) -- http://www.firstdata.com/--
provides electronic commerce and payment solutions for businesses
worldwide. The company's portfolio of services and solutions
includes merchant transaction processing services; credit, debit,
private-label, gift, payroll and other prepaid card offerings;
fraud protection and authentication solutions; electronic check
acceptance services through TeleCheck; as well as Internet
commerce and mobile payment solutions. The company's STAR Network
offers PIN-secured debit acceptance at 2 million ATM and retail
locations.
* * *
As reported in the Troubled Company Reporter on April 4, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
rating on First Data Corp. to 'BB+' from 'A' and placed it on
CreditWatch with negative implications. The rating action
followed First Data's agreement to be acquired by Kohlberg
Kravis Roberts & Co. in a transaction valued at about $29 billion.
FREEPORT-MCMORAN: Fitch Affirms BB Issuer Default Rating
--------------------------------------------------------
Fitch Ratings upgrades these ratings of Freeport-McMoRan Copper &
Gold Inc. and its subsidiary Phelps Dodge:
FCX
-- $1 billion Secured Bank Revolver to 'BB+' from 'BB';
-- 6.875% secured notes due 2014 to 'BB+' from 'BB';
-- Unsecured notes due 2015 and 2017 to 'BB' from 'BB-';
-- 7% convertible notes due 2011 to 'BB' from 'BB-'.
Phelps Dodge
-- 8.75% senior unsecured notes due 2011 to 'BB' from 'BB-';
-- 7.125% senior unsecured debentures due 2027 to 'BB' from
'BB-';
-- 9.50% senior unsecured notes due 2031 to 'BB' from 'BB-';
-- 6.125% senior unsecured notes due 2034 to 'BB' from 'BB-'.
In addition, Fitch affirms these ratings on FCX:
-- Issuer Default Rating at 'BB';
-- $500 million PT Freeport Indonesia/FCX Secured Bank
Revolver at 'BBB-';
-- Convertible Preferred Stock at 'B+'.
Fitch also assigns a rating of 'BB+' to FCX's new $2.45 billion
five-year term loan A. Proceeds of the loan were used to repay
the $2.45 billion remaining under the term loan due March 2014.
The term loan amortizes at 10% per annum with the remainder due at
maturity.
The Rating Outlook remains Positive.
Fitch estimates pro forma June 30, 2007 debt at $10 billion (down
from $12 billion) and latest 12 months ended June 30 EBITDA at $9
billion for total debt/EBITDA of 1.1 times. If copper prices
remain at $3/lb on average for the remainder of the year, the
year-end debt level should be reduced to about $9 billion.
The ratings reflect FCX's position as the world's second largest
copper producer, its diversified operations and strong liquidity
as well as the company's exposure to copper prices and its
relatively high financial leverage. The outlook is for copper
producers to continue to benefit from a strong pricing environment
over the near term.
GALENA STREET: Braddock to Liquidate $300 Million in Assets
-----------------------------------------------------------
Braddock Financial Corp. informed investors last week of its
intention to begin an orderly and voluntary liquidation of Galena
Street Fund's approximately $300 million in assets, suspending
current redemptions in the meantime. The company decided that it
was in the best interest of its investors, as a result of
redemption requests that were triggered by news that has impacted
the Asset-Backed Securities markets negatively.
Braddock is working with the fund's administrator, The Bank of New
York, to arrange a pro rata distribution through which each
investor in the Galena Street Fund will receive approximately 20%
of their current balance in the fund by this week. The company
will continue to distribute cash flow to investors as it is
received.
Unlike other ABS funds, Galena Street Fund has virtually no
leverage. Braddock's debt is less than 2% of fund assets. Given
that Galena is not forced to sell assets to pay off debt, the
company feels that investors are best served by an orderly
disposition of fund assets.
Moving forward, Braddock will manage the liquidation carefully and
patiently in order to optimize the return of investor capital in
as timely a manner as possible. The company intends to maximize
the value of the remaining assets in the fund, utilizing its many
years of experience in managing investments in ABS securities
successfully across various market cycles. Braddock will keep
Galena Street investors fully informed throughout the liquidation
process.
About Galena Street
The Galena Street Fund, run by Braddock Financial Corp.,
specializes in mortgage-backed securities.
About Braddock Financial
Headquartered in Denver, Colorado, Braddock Financial Corporation
is an SEC-registered investment adviser that manages investment
vehicles with a strategic focus in the structured finance sector
of the fixed income market. Since its inception in 1994, the
company has been able to successfully leverage its expertise in
the MBS and ABS markets to execute investment strategies that
create value for its investors.
GE CAPITAL: S&P Lifts Rating on Class M Certs. to BB+ from BB-
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on nine
classes of commercial mortgage pass-through certificates from GE
Capital Commercial Mortgage Corp.'s series 2002-2. Concurrently,
S&P affirmed its ratings on six other classes from the same
series.
The raised and affirmed ratings reflect credit enhancement levels
that provide adequate support through various stress scenarios.
The transaction's credit profile has benefited from the defeasance
of $242 million (28%) of the pool's collateral.
As of the June 11, 2007, remittance report, the collateral pool
consisted of 107 loans with an aggregate trust balance of
$873.4 million, down from 111 loans with a balance of
$971.8 million at issuance. The master servicer, Wachovia Bank
N.A., reported partial- and full-year 2006 financial information
for 91% of the pool, and partial- and full-year 2005 financial
information for 9% of the pool, which excludes the defeased
collateral. Based on this information, Standard & Poor's
calculated a weighted average debt service coverage of 1.34x, up
slightly from 1.32x at issuance. All of the loans in the pool are
current, and no loans are with the special servicer. To date, the
trust has experienced one loss totaling $157,596.
The top 10 loans secured by real estate have an aggregate
outstanding balance of $258.9 million (29%) and a weighted average
DSC of 1.26x based on year-end 2006 financial statements, down
from 1.31x at issuance. Two of the top 10 loans are on the
watchlist because of occupancy issues and near-term rollover risk
and are discussed below. According to inspection reports received
from Wachovia, all properties were characterized as "good."
Wachovia reported a watchlist of 24 loans with an aggregate
outstanding balance of $129 million (15%). Details regarding the
two top 10 loans on the master servicer's watchlist are:
-- The fourth-largest exposure, Colorado Springs multifamily
portfolio ($30.0 million, 3%), consists of seven loans
that are cross-collateralized and cross-defaulted. The
Colorado Springs multifamily portfolio is secured by seven
multifamily properties with a total of 1,178 units located
throughout Colorado Springs, Colorado. This portfolio is
on the watchlist because the properties reported a
weighted average year-end 2006 DSC of 0.58x. Occupancy
levels are low due to weak market conditions. Weighted
average occupancy for the portfolio was 64% as of year-end
2006.
-- 1500 Rosecrans Avenue, a 124,912-sq.-ft. office property
in Manhattan Beach, California, secures the 10th-largest
loan ($14.8 million, 2%). This loan is on the watchlist
because the property's largest tenant, who holds 37% of
the net rentable area, is vacating the premises upon lease
expiration in November 2007. As of Dec. 31, 2006, the DSC
for this loan was 1.41x, and occupancy was 99%.
Standard & Poor's stressed the loans on the watchlist and other
loans with credit issues as part of its analysis. The resultant
credit enhancement levels support the raised and affirmed ratings.
Ratings Raised
GE Capital Commercial Mortgage Corp.
Commercial mortgage pass-through certificates
series 2002-2
Rating
------
Class To From Credit enhancement
----- -- ---- ----------------
D AAA AA+ 16.39%
E AA+ AA 14.03%
F AA A+ 12.92%
G AA- A 11.67%
H A+ BBB+ 10.14%
J A- BBB 7.91%
K BBB B+ 5.82%
L BBB- BB 4.99%
M BB+ BB- 4.43%
Ratings Affirmed
GE Capital Commercial Mortgage Corp.
Commercial mortgage pass-through certificates
series 2002-2
Class Rating Credit enhancement
----- ------ ----------------
A-2 AAA 25.43%
A-3 AAA 25.43%
B AAA 21.40%
C AAA 20.01%
X-1 AAA N/A
X-2 AAA N/A
N/A - not applicable.
GERDAU AMERISTEEL: Buying Chaparral Steel for $4.22 Bil. in Cash
----------------------------------------------------------------
Gerdau Ameristeel Corporation signed a definitive merger agreement
to acquire Chaparral Steel Company, for $86.00 per share in cash.
Chaparral Steel Company's Board of Directors has unanimously
approved the transaction and will recommend to Chaparral Steel
Company's shareholders that they vote in favor of the offer. The
offer price values Chaparral Steel's equity at $4.22 billion.
Mario Longhi, GNA's President and CEO said, "The acquisition of
Chaparral Steel Company is consistent with Gerdau Ameristeel's
strategy to further diversify its product offering into high value
added steel products. This strategic combination is an excellent
fit for us and it broadens our product portfolio and gives us a
full range of structural steel products. As a premium steel asset,
Chaparral brings not only high quality products and assets but
also a strong organization with excellent technical capabilities."
Following the closing of the proposed transaction, Gerdau
Ameristeel intends to explore the issuance of equity securities,
with the goal of achieving a prudent level of capitalization and
maintaining a strong balance sheet. The company's majority
shareholder, Gerdau S.A., has committed to support Gerdau
Ameristeel and will subscribe to any equity issuance in order to
maintain its current level of equity ownership.
Gerdau Ameristeel expects that the combination with Chaparral
Steel Company's operations will generate annual pre-tax operating
synergies in excess of $55 million by the end of 2008. Gerdau
Ameristeel expects that the transaction will be slightly dilutive
to its 2007 and 2008 earnings per share after considering expected
synergies and after taking into effect the contemplated equity
issuance.
"This transaction reaffirms our strategy to participate in the
global steel consolidation. As we have indicated previously,
Gerdau Ameristeel provides our platform for growth in North
America," Andre Johannpeter, President and CEO of the Gerdau Group
commented. "We have a history of successfully integrating
businesses and capturing synergies through the implementation and
execution of the Gerdau Business System."
The transaction is subject to the approval of Chaparral Steel
Company's shareholders and other customary closing conditions,
including regulatory approvals, and is expected to close before
year end.
The proposed transaction has been unanimously approved by the
Gerdau Ameristeel Board of Directors. J.P. Morgan Securities Inc.
is acting as exclusive financial advisor to Gerdau Ameristeel and
the Gerdau Group on this transaction and has provided financing
commitments of $4.6 billion to Gerdau Ameristeel to complete the
transaction. Simpson Thacher and Bartlett LLP and Torys LLP acted
as legal advisors for the transaction.
About Chaparral Steel
Headquartered in Midlothian, Texas, Chaparral Steel Company --
http://www.chapusa.com/-- is the second largest producer of
structural steel products in North America and also a major
producer of steel bar products. It operates two mini-mills, one
located in Midlothian, Texas, and the other located in Dinwiddie
County, Virginia. The company has approximately 1,400 employees
and an annual installed capacity of 2.9 million metric tons.
About Gerdau Ameristeel
Headquartered in Tampa, Florida, Gerdau Ameristeel Corporation --
http://www.gerdauameristeel.com/-- (NYSE:GNA; TSX:GNA.TO) is the
second largest minimill steel producer in North America with
annual manufacturing capacity of over 9 million tons of mill
finished steel products. Through its vertically integrated
network of 17 minimills (including one 50%-owned joint venture
minimill), 17 scrap recycling facilities and 51 downstream
operations (including seven joint venture fabrication facilities),
Gerdau Ameristeel serves customers throughout North America. The
company's products are generally sold to steel service centers, to
steel fabricators, or directly to original equipment manufacturers
for use in a variety of industries, including construction,
automotive, mining, cellular and electrical transmission, metal
building manufacturing and equipment manufacturing. The company
is a subsidiary of Brazil's Gerdau SA.
* * *
As reported in the Troubled Company Reporter on May 16, 2007,
Standard & Poor's Ratings Services raised its corporate credit
rating on Tampa, Florida-based Gerdau Ameristeel Corp. to 'BB+'
from 'BB' and removed all ratings from CreditWatch, where they
were placed with positive implications on Jan. 17, 2007.
At the same time, S&P raised its rating on the company's senior
unsecured debt to 'BB+' from 'BB'. The outlook is stable.
GO LOGISTICS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Go Logistics, Inc.
dba Go Trans
157 South Parkway East
Memphis, TN 38106
Bankruptcy Case No.: 07-26324
Type of Business: The Debtor operates a trucking company and
offers moving and logistics services.
See http://www.gotrans.net/contact/
Chapter 11 Petition Date: July 10, 2007
Court: Western District of Tennessee (Memphis)
Judge: Paulette J. Delk
Debtor's Counsel: Jonathan E. Scharff, Esq.
Harris Shelton Hanover Walsh, PLLC
One Commerce Square, Suite 2700
Memphis, TN 38103-2555
Tel: (901) 525-1455
Fax: (901) 526-4084
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's List of its 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
FEDEX $812,506
P.O. Box 94515
Palatine, IL 60094-4515
PREPASS $147,875
23566 Network Place
Chicago, IL 60673
H&P Leasing $75,136
P.O. Box 6257
Jackson, MS 39288-6257
BB&T Leasing Corporation $59,912
Xtra Lease $37,442
Barloworld Truck Center $30,753
Southern Tire Mart, LLC $27,280
Sprint/Nextel $24,289
USIS Commercial Services, Inc. $13,434
Steepleton Tire Co. $12,009
UnitedHealthCare $11,519
Hiner Logistics, LLC $10,320
Lincoln General Insurance Co. $7,511
Time Warner Telecom $6,512
J.J. Keller & Associates, Inc. $6,435
Airport Inn $6,166
Maintenance Supply & Fastener Co., Inc. $5,880
Ashland $4,420
Yuletide Office Supply $3,482
Best Tarps $3,365
GRAPHIC PACKAGING: Signs $1.7 Billion Merger Pact with Altivity
---------------------------------------------------------------
Graphic Packaging Corporation and the owners of Altivity Packaging
LLC signed a definitive agreement to combine the two companies.
The transaction is expected to be completed in the fourth quarter
of 2007, subject to customary shareholder and regulatory
approvals. The transaction has been approved by the boards of
directors of both companies. Affiliates of TPG Capital, who
control and own the majority of Altivity Packaging, have agreed to
the transaction, and Graphic Packaging's three largest
shareholders, who on a combined basis control more than 60% of
Graphic Packaging's outstanding common stock, have agreed to vote
in favor of the merger.
The merger is expected to create significant stockholder value by
expediting growth opportunities, achieving significant cost
savings and enhancing the credit profile of the newly-formed
company through accelerated debt reduction.
Transaction Terms
Under the terms of the transaction, Graphic Packaging will merge
into a newly-formed company, with each existing share of Graphic
Packaging common stock being converted into a share of common
stock in the new company. Affiliates of TPG Capital and the
management owners of Altivity Packaging will contribute all of
their equity interests in Altivity Packaging's holding company to
the new company in exchange for shares of the new company's common
stock.
Upon closing of the transaction, Graphic Packaging's current
shareholders will initially own approximately 60% of the new
company's common stock, while the shareholders of Altivity
Packaging will initially own about 40%. Shares of the new
company, to be named Graphic Packaging Holding Company, are
expected to trade on the New York Stock Exchange under the trading
symbol "GPK".
The transaction values Altivity Packaging at about $1.75 billion,
based on Altivity Packaging's current net debt of $1.1 billion as
of March 31, 2007, and Graphic Packaging's 30-trading day average
stock price of $4.92 per share as of July 5, 2007.
In connection with the transaction, Graphic Packaging has obtained
committed financing to refinance Altivity Packaging's existing
indebtedness.
Defining Event
Graphic Packaging's president and chief executive officer, David
W. Scheible, will serve as the president, chief executive officer,
and member of the board of directors of the new company, while
George Bayly, Altivity Packaging's chairman and interim chief
executive officer, will also join the new company's board of
directors. The new company's Board will be comprised of a
majority of independent directors, and will be chaired by Graphic
Packaging's current non-executive chairman, John R. Miller. The
new company will be based in Marietta, GA, and will retain a
significant presence in Chicago, IL, where Altivity Packaging is
currently headquartered.
"Our two companies share similar operating philosophies, including
an unwavering commitment to serving our customers with innovative
products and solutions," said David W. Scheible, Graphic
Packaging's president and chief executive officer. "Our focus on
continuous improvement will greatly enhance our integration
activities, help us achieve our cost savings and merger synergy
targets and drive superior results. The new company will benefit
from strong positions in multiple packaging sectors including
paperboard, folding carton, multi-wall & specialty bags, flexible
packaging and labels, positioning us to provide our customers
greater choice, better service, higher quality and more innovative
solutions for all of their packaging needs. Furthermore, this
merger will expand the breadth and diversity of our combined
customer bases, improve our service to key national accounts, and
improve access to the regional and specialty customer segments."
"This merger brings together two companies that are highly
respected leaders in the packaging industry," said George Bayly,
Altivity Packaging's chairman and interim chief executive officer.
"Together, the new company will serve a more diversified customer
base and achieve economies of scale and operating efficiencies
that would be more difficult to achieve on a stand- alone basis.
Under David's leadership, I am confident in our collective ability
to achieve our original cost savings and growth objectives, to
realize substantial merger synergies, and to better serve our
customers and employees who represent the future of our new
company."
High Quality of Assets
The merger of Graphic Packaging and Altivity Packaging brings
together 86 high quality manufacturing and converting facilities
and approximately 15,600 people on five continents, enabling the
combined company to better serve customers and reduce costs.
Graphic Packaging has 23 folding carton facilities, 4 mills,
2 packaging machinery manufacturing facilities, and 1 flexible
packaging facility. Altivity Packaging has 24 folding carton
facilities, 12 multi-wall & specialty bag facilities, 6 mills,
5 flexible packaging facilities, 5 ink facilities, 3 label
facilities and 1 packaging machinery equipment facility.
Financial Expectations
As a result of the transaction, the new company projects it will
achieve annual gross merger synergies of over $90 million expected
to be fully realized by 2011, with approximately 2/3rds realized
by 2009. Although restructuring charges are anticipated to result
from the integration, the new company is expected to generate cash
flow from synergies in excess of the cash payments used for
restructuring charges in each year. Such synergies are expected to
be achieved through operating expense reductions, supply chain
procurement changes, mill optimization efforts and manufacturing
process improvements.
Altivity Packaging management expects to achieve 2007 EBITDA in
excess of $200 million excluding one-time costs to achieve cost
savings and other one- time expenses of an estimated $35 million.
Altivity Packaging management forecasts stand-alone cost
reductions of approximately $50 million in 2007 and an additional
$45 million in annual cost savings to be fully achieved by 2009.
Altivity Packaging's stand-alone savings will result from
manufacturing network optimization efforts, overhead reduction and
supply-chain improvements and are separate from the gross merger
synergies of over $90 million expected to be derived from the
combination of Graphic Packaging and Altivity Packaging.
Daniel J. Blount, senior vice president and chief financial
officer of Graphic Packaging, stated, "We expect the combined
companies to generate substantial cash flow to accelerate debt
reduction, improve leverage ratios, finance ongoing investment and
fund growth initiatives. The transaction is anticipated to be
accretive to earnings per share and free cash flow by 2008. Both
companies have proven track records in merger integration, cost
reduction and synergy attainment, and demonstrated ongoing
productivity and quality programs. This transaction presents an
attractive opportunity on all fronts."
Advisors
Goldman, Sachs & Co. acted as financial adviser and Alston & Bird
LLP acted as legal counsel to Graphic Packaging, and Banc of
America Securities LLC acted as financial adviser and Simpson
Thacher & Bartlett LLP acted as legal counsel to Altivity
Packaging.
About Altivity Packaging
Altivity Packaging LLC, headquartered in Chicago, Illinois -
http://www.altivity.com/-- is a privately-held producer of
folding cartons. The company operates six recycled boxboard mills
and 50 consumer-packaging facilities in North America.
About Graphic Packaging
Headquartered in Marietta, Georgia, Graphic Packaging Corporation
(NYSE: GPK) -- http://www.graphicpkg.com/-- produces CUK
paperboard in North America and is the successor to the 2003
merger of Graphic Packaging International Corporation and
Riverwood Holding Inc. GPK is an international manufacturer and
supplier of folding cartons and multi-pack beverage containers and
paperboard containers for food and other consumer products
companies.
* * *
As reported in the Troubled Company Reporter on May 2, 2007, Fitch
has taken these rating actions on Graphic Packaging Corporation:
(i) Senior secured revolver upgraded to 'BB-/RR2' from 'B+/RR3';
(ii) Senior secured term loan upgraded to 'BB-/RR2 from 'B+/RR3';
(iii) Issuer Default Rating affirmed at 'B'; (iv) Senior unsecured
bonds affirmed at 'B/RR4'; (v) Senior subordinated notes affirmed
at 'B-/RR5'. The Rating Outlook is Stable.
GREENWICH CAPITAL: Moody's Affirms Low-B Ratings to Six Certs.
--------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 24 classes of
Greenwich Capital Commercial Funding Corp., Commercial Mortgage
Pass-Through Certificates, Series 2005-GG5 as:
-- Class A-1, $83,250,578, affirmed at Aaa
-- Class A-2, $910,000,000, affirmed at Aaa
-- Class A-3, $65,000,000, affirmed at Aaa
-- Class A-4-1, $307,000,000, affirmed at Aaa
-- Class A-4-2, $50,000,000, affirmed at Aaa
-- Class A-AB, $139,000,000, affirmed at Aaa
-- Class A-5, $1,427,604,000, affirmed at Aaa
-- Class A-M, $429,515,000, affirmed at Aaa
-- Class A-J, $300,660,000, affirmed at Aaa
-- Class XC, Notional, affirmed at Aaa
-- Class XP, Notional, affirmed at Aaa
-- Class B, $96,641,000, affirmed at Aa2
-- Class C, $37,583,000, affirmed at Aa3
-- Class D, $80,534,000, affirmed at A2
-- Class E, $37,582,000, affirmed at A3
-- Class F, $53,690,000, affirmed at Baa1
-- Class G, $42,951,000, affirmed at Baa2
-- Class H, $48,321,000, affirmed at Baa3
-- Class J, $21,476,000, affirmed at Ba1
-- Class K, $21,475,000, affirmed at Ba2
-- Class L, $21,476,000, affirmed at Ba3
-- Class M, $5,369,000, affirmed at B1
-- Class N, $16,107,000, affirmed at B2
-- Class O, $10,738,000, affirmed at B3
As of the June 12, 2007 distribution date, the transaction's
aggregate certificate balance decreased by about .6% to
$4.27 billion from $4.30 billion at securitization. The
certificates are collateralized by 173 loans, ranging in size from
less than 1% to 7.5% of the pool, with the top 10 loans
representing 41.5% of the pool. The pool includes two shadow
rated loans, representing 2.8% of the pool. No loans have
defeased. The pool has not realized any losses since
securitization and currently there are no loans in special
servicing. Sixteen loans, representing 3.2% of the pool, are on
the master servicer's watchlist.
Moody's was provided with partial- or full-year 2006 operating
results for 91% and 72.1%, respectively, of the pool. Moody's
weighted average loan to value ratio for the conduit component is
103.4%, compared to 105.1% at securitization, resulting in an
affirmation of all classes.
The largest shadow rated loan is the Westfield San Francisco
Centre Loan ($60.4 million -- 1.4%), which represents a 50% pari
passu interest in a $120 million first mortgage loan secured by
the borrower's leasehold interest in a 498,103 square foot retail
center located in the Union Square retail area of San Francisco,
California. The loan is interest only for its entire term.
Moody's current shadow rating is Baa2, the same as at
securitization.
The second largest shadow rated loan is the Imperial Valley --
El Centro Loan ($58.5 million -- 1.4%), which is secured by the
borrower's interest in an 765,000 square foot regional mall
(266,000 square feet of collateral) located in El Centro,
California. Moody's current shadow rating is Baa3, the same as at
securitization.
The top three conduit loans represent 20.6% of the pool. The
largest conduit loan is the 731 Lexington Avenue Loan
($320 million -- 7.5%), which is secured by a 148,000 square foot
multi-level retail condominium located at 731 Lexington Avenue in
New York City. The loan is interest only for its entire term.
Moody's LTV is 97.2%, essentially the same as at securitization.
The second largest conduit loan is the Schron Industrial Portfolio
Loan ($317.5 million -- 7.4%), which is secured by a 36
industrial/flex facilities totaling 6.2 million square feet of
space located in 14 states. The largest state concentration is
Pennsylvania (18.7%). There is also $22.5 million of subordinate
debt held outside the trust. Moody's LTV is in excess of 100%,
the same as at securitization.
The third largest conduit loan is the Lynnhaven Mall Loan
($244.2 million -- 5.7%), which is secured by the borrower's
interest in a 1.3 million square foot regional mall
(776,000 square feet of collateral) located in Virginia Beach,
Virginia. Moody's LTV is 94.6%, compared to 96.8% at
securitization.
GREGG APPLIANCES: Obtains Consents to Amend Indenture on 9% Notes
-----------------------------------------------------------------
Gregg Appliances Inc. received requisite consents to amend the
indenture governing its $111,205,000 aggregate amount of 9% senior
notes due 2013. The company had previously announced a tender
offer and consent solicitation for any and all of its outstanding
9% senior notes.
The supplemental indenture effecting the proposed amendments, as
described in the offer to purchase and consent solicitation
statement, dated as of June 26, 2007, to the indenture governing
the 9% senior notes has been executed. The amendments to the
indenture governing the notes will become operative upon payment
by Gregg Appliances for the 9% senior notes tendered for purchase.
The 9% senior notes tendered may no longer be withdrawn and
consents delivered may no longer be revoked.
Wachovia Securities is acting as exclusive dealer manager and
solicitation agent for the tender offer and the consent
solicitation. The information agent and tender agent for the
tender offer is Global Bondholder Services Corporation.
Questions regarding the tender offer and consent solicitation may
be directed to:
Wachovia Securities
Liability Management Group
Telephone: (866) 309-6316 (toll free)
(704) 715-8341 (call collect)
Requests for copies of the offer to purchase and consent
solicitation statement and related documents may be directed to:
Global Bondholder Services Corporation
Telephone: (866) 470-4500 (toll free)
(212) 430-3774 (call collect)
About Gregg Appliances
Headquartered in Burbank, California, Gregg Appliances Inc. --
http://www.hhgregg.com/-- is a specialty retailer of consumer
electronics, home appliances, mattresses and related services.
It operates under the hhgregg(R) and Fine Lines(R) brands in
79 stores in Alabama, Georgia, Indiana, Kentucky, North Carolina,
Ohio, South Carolina and Tennessee.
* * *
As reported in the Troubled Company Reporter on June 12, 2007,
Standard & Poor's Rating Services raised its corporate credit
rating on Gregg Appliances Inc. to 'B+' from 'B'.
GREGG APPLIANCES: Prices $111.2 Million 9% Senior Notes Offering
----------------------------------------------------------------
Gregg Appliances Inc. determined the consideration to be paid for
any and all of its outstanding $111,205,000 aggregate amount of
9% senior notes due 2013, in connection with its previously
announced tender offer and consent solicitation for the 9% senior
notes.
The total consideration, excluding accrued and unpaid interest,
for each $1,000 principal amount of 9% senior notes validly
tendered, and not validly withdrawn, on or prior to 5 p.m., New
York City time, on July 10, 2007, is $1,092.19, which includes a
$30 consent payment.
The total consideration was determined using a yield equal to the
fixed spread of 50 basis points plus the bid side yield to
maturity of the 4.875% U.S. Treasury Note due Jan. 31, 2009, which
yield was determined as of 2 p.m., New York City time, on July 10,
2007.
The total consideration was determined based on an expected
settlement date of July 25, 2007. Holders who validly tender
their 9% senior notes will receive accrued and unpaid interest
from the most recent interest payment date for the 9% senior notes
to, but not including the applicable payment date. The tender
offer will expire at midnight, New York City time, on July 24,
2007, unless otherwise extended or earlier terminated.
As of the consent payment deadline, tenders and consents had been
received with respect to $104,272,000 aggregate principal amount
of the 9% senior notes, or about 93.8% of the total outstanding
principal amount.
The tender offer is conditioned upon, among other things:
(a) the receipt of tendered 9% senior notes from the holders
of at least a majority of the aggregate principal amount
of the 9% senior notes outstanding;
(b) the receipt of consents to the proposed amendments from
the holders of at least a majority of the aggregate
principal amount of the 9% senior notes outstanding;
(c) the consummation of the initial public offering of
hhgregg Inc. resulting in gross proceeds to hhgregg of at
least $50 million;
(d) the consummation of a corporate reorganization whereby
Gregg Appliances will become a wholly owned subsidiary of
Hhgregg; and
(e) the closing of the debt refinancing of Gregg Appliances,
whereby Gregg Appliances will amend or amend and restate
its existing $75 million revolving credit facility, to
among other things, increase the amount of the facility
to $100 million, and enter into a new $100 million term
loan B.
Gregg Appliances expressly reserves the right, in its sole
discretion, subject to applicable law to:
(a) terminate prior to the expiration date any tender offer
and consent solicitation and not accept for payment any
9% senior notes not theretofore accepted for payment;
(b) waive on or prior to the expiration date any and all of
the conditions of the tender offer and the consent
solicitation;
(c) extend the expiration date; and
(d) amend the terms of the tender offer or consent
solicitation.
The foregoing rights are in addition to its right to delay
acceptance for payment of the 9% senior notes tendered under the
tender offer or the payment for the 9% senior notes accepted for
payment in order to comply in whole or in part with any applicable
law, subject to Rule 14e-l(c) under the Securities Exchange Act of
1934, as amended, to the extent applicable, which requires that an
offeror pay the consideration offered or return the securities
deposited by or on behalf of the holders of the notes promptly
after the termination or withdrawal of the tender offer.
Wachovia Securities is acting as exclusive dealer manager and
solicitation agent for the tender offer and the consent
solicitation. The information agent and tender agent for the
tender offer is Global Bondholder Services Corporation.
Questions regarding the tender offer and consent solicitation may
be directed to:
Wachovia Securities
Liability Management Group
Telephone: (866) 309-6316 (toll free)
(704) 715-8341 (call collect)
Requests for copies of the offer to purchase and consent
solicitation statement and related documents may be directed to:
Global Bondholder Services Corporation
Telephone: (866) 470-4500 (toll free)
(212) 430-3774 (call collect)
About Gregg Appliances
Headquartered in Burbank, California, Gregg Appliances Inc. --
http://www.hhgregg.com/-- is a specialty retailer of consumer
electronics, home appliances, mattresses and related services. It
operates under the hhgregg(R) and Fine Lines(R) brands in 79
stores in Alabama, Georgia, Indiana, Kentucky, North Carolina,
Ohio, South Carolina and Tennessee.
* * *
As reported in the Troubled Company Reporter on June 12, 2007,
Standard & Poor's Rating Services raised its corporate credit
rating on Gregg Appliances Inc. to 'B+' from 'B'.
GS MORTGAGE: Fitch Rates $18.907 Mil. Class Q Certificates at B-
----------------------------------------------------------------
GS Mortgage Securities Corporation II Series 2007-GG10, commercial
mortgage pass-through certificates, are rated by Fitch Ratings as
follows:
-- $75,000,000 class A-1 'AAA';
-- $725,300,000 class A-2 'AAA';
-- $246,609,000 class A-3 'AAA';
-- $72,000,000 class A-AB 'AAA';
-- $3,661,032,000 class A-4 'AAA';
-- $514,000,000 class A-1A 'AAA';
-- $756,277,000 class A-M 'AAA';
-- $519,941,000 class A-J 'AAA';
-- $7,562,773,702 class X 'AAA'(notional amount and interest-
only);
-- $75,628,000 class B 'AA+';
-- $94,535,000 class C 'AA';
-- $56,720,000 class D 'AA-';
-- $56,721,000 class E 'A+';
-- $75,628,000 class F 'A';
-- $75,628,000 class G 'A-';
-- $103,988,000 class H 'BBB+';
-- $94,534,000 class J 'BBB'.
-- $75,628,000 class K 'BBB-';
-- $37,814,000 class L 'BB+';
-- $18,907,000 class M 'BB';
-- $28,360,000 class N 'BB-';
-- $18,907,000 class O 'B+';
-- $18,907,000 class P 'B';
-- $18,907,000 class Q 'B-';
-- $141,802,702 class S 'NR';
Classes A-1, A-2, A-3, A-AB, A-4, A-1A, A-M, A-J, B, C, D, E, and
F are offered publicly, while classes G, H, J, K, L, M, N, O, P,
Q, S, and X are privately placed pursuant to rule 144A of the
Securities Act of 1933. The certificates represent beneficial
ownership interest in the trust, primary assets of which are 202
fixed-rate loans having an aggregate principal balance of
approximately $7,562,773,702 as of the cutoff date.
ITC^DELTACOM INC: Moody's Rates Corporate Family Rating at B3
-------------------------------------------------------------
Moody's Investors Service assigned a B3 corporate family rating to
ITC^Deltacom, Inc., and a B2 rating for the proposed $240 million
first lien credit facilities at Interstate Fibernet, Inc.,
Deltacom's wholly-owned subsidiary.
Fibernet will also raise a $75 million second lien term loan,
which Moody's has not rated. The outlook is stable. The new
financing, along with over $50 million in new equity will be used
to refinance existing debt and for general corporate purposes.
The B3 corporate family rating reflects Deltacom's financial risk,
as it continues its turnaround, lack of free cash flow generation,
and the challenging competitive position which is compounded by
the low profitability of its current operations. The ratings
benefit somewhat from the new equity contributions, the conversion
of existing preferred stock into common equity, and good
liquidity.
Moody's assigned these ratings:
Issuer -- ITC^Deltacom, Inc.
-- Corporate Family Rating -- Assigned B3
-- Probability-of-default rating -- Assigned B3
Issuer -- Interstate Fibernet, Inc.
-- 1st Lien Secured RC, due 2012 -- Assigned B2 (LGD 3 -- 36%)
-- 1st Lien Secured TL, due 2013 -- Assigned B2 (LGD 3 -- 36%)
Outlook is Stable
The company is well-positioned within the B3 rating category. The
stable rating outlook considers the company's growth plans and the
planned operating improvements which, barring one-time
transforming events, form a solid foundation for good momentum
over the rating horizon.
Deltacom, headquartered in Huntsville, Alabama, is a CLEC serving
over 450,000 access lines in the Southeastern US.
JORDYN HOLDINGS: Files Schedules of Assets and Liabilities
----------------------------------------------------------
Jordyn Holdings IV LLC delivered its Schedules of Assets and
Liabilities to the U.S. Bankruptcy Court for the Middle District
of Florida, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $28,000,000
B. Personal Property $28,390,000
C. Property Claimed
as Exempt
D. Creditors Holding
Secured Claims $13,311,000
E. Creditors Holding
Unsecured Priority Claims
F. Creditors Holding
Unsecured Non-priority
Claims $10,530,627
----------- -----------
Total $56,390,000 $23,841,627
About Jordyn Holdings
Based in Sarasota, Florida, Jordyn Holdings IV LLC filed for
Chapter 11 bankruptcy protection on June 13, 2007 (Bankr. M.D.
Fla. Case No. 07-05006). Richard J. McIntyre, Esq., at The
McIntyre Law Firm, P.L., represents the Debtor in its
restructuring efforts.
JORDYN HOLDINGS: U.S. Trustee Appoints Five-Member Committee
------------------------------------------------------------
Felicia S. Turner, acting U.S. Trustee of Region 21 appointed
five members to serve on an Official Committee of Unsecured
Creditors in Jordyn Holdings IV LLC's Chapter 11 cases:
1. Craig Abbott
President, M & C Investment
Tel: (941) 486-8137
Fax: (941) 486-1678
3508 East Laurel Road
Nokomis, FL 34275
2. Lee Neighbors
Managing Member, LLN Holdings LLC
Tel: (941) 376-5940
4611 Higel Avenue
Sarasota, FL 34242
3. Harold L. Libby
H.L. Libby Corporation
Tel: (941) 320-6554
Fax: (941) 373-0208
950 South Tamiami Trail, Suite 204
Sarasota, FL 34236
4. Nick Melone
Tel: (941) 544-5570
Main Street Holdings, LLC
1358 Fruitville Road, Suite 310
Sarasota, Florida 34236
njm5570@aol.com
5. Jody Denham
Tel: (941) 922-9333
Fax: (941) 927-1765
2609 Proctor Road
Sarasota, FL 34231
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 Jordyn Holdings
Based in Sarasota, Florida, Jordyn Holdings IV LLC filed for
Chapter 11 bankruptcy protection on June 13, 2007 (Bankr. M.D.
Fla. Case No. 07-05006). Richard J. McIntyre, Esq., at The
McIntyre Law Firm, P.L., represents the Debtor in its
restructuring efforts.
JP MORGAN: Moody's Affirms Low-B Ratings to Six Certificates
------------------------------------------------------------
Moody's Investors Service upgraded the ratings of four classes and
affirmed the ratings of 12 classes of J.P. Morgan Chase Commercial
Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 2003-ML1 as:
-- Class A-1, $297,988,511, affirmed at Aaa
-- Class A-2, $387,129,000, affirmed at Aaa
-- Class X-1, Notional, affirmed at Aaa
-- Class X-2, Notional, affirmed at Aaa
-- Class B, $26,732,000, affirmed at Aaa
-- Class C, $10,461,000, affirmed at Aaa
-- Class D, $22,083,000, upgraded to Aaa from Aa2
-- Class E, $12,785,000, upgraded to Aa2 from A1
-- Class F, $23,246,000, upgraded to A2 from Baa1
-- Class G, $9,298,000, upgraded to Baa1 from Baa3
-- Class H, $16,272,000, affirmed at Ba1
-- Class J, $10,460,000, affirmed at Ba2
-- Class K, $5,812,000, affirmed at Ba3
-- Class L, $5,811,000, affirmed at B1
-- Class M, $6,974,000, affirmed at B2
-- Class N, $4,649,000, affirmed at B3
As of the June 12, 2007 distribution date, the transaction's
aggregate certificate balance decreased by about 8.4% to
$852.1 million from $929.8 million at securitization.
The certificates are collateralized by 120 loans, ranging in size
from less than 1% to 6.1% of the pool, with the top 10 loans
representing 28% of the pool.
The pool includes one investment grade shadow rated loan,
representing 5.5% of the pool. There are no loans in special
servicing currently. One loan has been liquidated from the trust
resulting in aggregate a realized loss of about $2.7 million.
Twenty-one loans, representing 25% of the pool, have defeased and
have been replaced with U.S. Government securities. Eighteen
loans, representing 9.9% of the pool, are on the master servicer's
watchlist.
Moody's was provided with full-year 2006 operating results for
93.5% of the pool. Moody's weighted average loan to value ratio
for the conduit component is 80.3%, compared to 86.5% at
securitization. Moody's is upgrading Classes D, E, F and G due to
improved overall pool performance, defeasance and increased credit
support.
The shadow rated loan is the Hyatt Regency Hotel Loan
($48 million -- 5.6%), which is secured by a 685-room full service
hotel located in Arlington, Virginia. Moody's current shadow
rating is A3, the same as at securitization.
The top three conduit loans represent 12.2% of the pool.
The largest conduit loan is the Mall of Victor Valley Loan
($51.6 million -- 6%), which is secured by the borrower's interest
in a 507,000 square foot regional mall (431,738 square feet of
collateral) located in Victorville, California. Moody's LTV is
65.9%, compared to 69.7% at last review and compared to 84.2% at
securitization.
The second largest conduit loan is the JANAF Shopping Center Loan
($33.4 million -- 3.9%), which is secured by a 583,000 square foot
retail center located in Norfolk, Virginia. The loan amortizes on
a 300-month schedule. Loan performance has improved due to an
increase in base rents and loan amortization. Moody's LTV is
71.4%, compared to 79% at last review and compared to 82.9% at
securitization.
The third largest conduit loan is the Overland Storage Campus Loan
($18.9 million -- 2.2%), which is secured by a two-story office
building and a single-story R&D building totaling 158,585 square
feet located in Kearny Mesa, California. The property is 100%
leased to Overland Data, Inc. through February 2014. Loan
performance has improved as a result of loan amortization and
revenue increases. Moody's LTV is 70.1%, compared to 80.6% at
last review and compared to 91.8% at securitization.
KIMBERLITE CDO: Fitch Affirms BB Rating on $22.5MM Class H Notes
----------------------------------------------------------------
Fitch affirms eight classes of notes issued by Kimberlite CDO I,
Ltd. and Kimberlite CDO I LLC.
These rating actions are effective immediately:
-- $79,375,000 Class A senior floating-rate notes affirmed at
'AAA';
-- $40,125,000 Class B senior floating-rate notes affirmed at
'AA';
-- $45,750,000 Class C mezzanine floating-rate deferrable
notes affirmed at 'A+';
-- $10,125,000 Class D mezzanine floating-rate deferrable
notes affirmed at 'A';
-- $9,750,000 Class E mezzanine floating-rate deferrable notes
affirmed at 'A-';
-- $11,625,000 Class F mezzanine floating-rate deferrable
notes affirmed at 'BBB+';
-- $12,000,000 Class G mezzanine floating-rate deferrable
notes affirmed at 'BBB-';
-- $22,500,000 Class H mezzanine floating-rate deferrable
notes affirmed at 'BB'.
Kimberlite CDO I represents a hybrid collateralized debt
obligation transaction that combines the use of synthetic and cash
assets, as well as unfunded and funded liabilities. Kimberlite
CDO I closed on Sept. 28, 2006 and is managed by BlackRock
Financial Management, Inc., which is rated 'CAM1' by Fitch. The
capital structure of the deal includes a $500 million unfunded
super senior facility and $250 million of funded notes. The deal
gains 90% of its exposure to structured finance assets
synthetically. Synthetic exposure can be created through the use
of both funded and unfunded synthetic securities backed by a
combination of a super senior facility, a liquidity facility and a
reserve account. The deal can also purchase cash assets directly
or reference them through the use of a total return swap facility.
The portfolio is currently composed of commercial mortgage-backed
securities (91.6%) and commercial real estate CDOs (8.4%). The
collateral manager has the ability to sell 15% of the collateral
per annum on a discretionary basis during the 5.0 year
reinvestment period. Kimberlite CDO I will end its reinvestment
period in October 2011.
The affirmations are the result of stable portfolio performance
measures, such as par value coverage ratios and the weighted
average rating factor. As of the most recent trustee report dated
June 22, 2007 all coverage ratios have remained stable and
continue to pass their covenants. The current WARF on the
collateral has improved to 7.95 ('BBB-'/'BB+'). The collateral
has a maximum Fitch WARF of 8.942 ('BBB-/BB+'). There have been
no defaulted or distressed securities in the portfolio. Fitch
will continue to monitor this transaction as the CDO is currently
in its reinvestment period in which new collateral may be
purchased to replace existing collateral, subject to reinvestment
criteria.
The ratings of the class A and B notes address the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the aggregate outstanding
amount of principal by the stated maturity date. The ratings of
the class C, D, E, F, G and H notes address the likelihood that
investors will receive ultimate and compensating interest
payments, as per the governing documents, as well as the aggregate
outstanding amount of principal by the stated maturity date.
LAS VEGAS MONORAIL: Fitch Lowers Rating on $451.4MM Bonds to CC
---------------------------------------------------------------
Fitch Ratings has downgraded to 'CC' from 'CCC' the underlying
rating on the $451.4 million in outstanding Director of the State
of Nevada Department of Business and Industry Las Vegas Monorail
project revenue bonds, 1st tier, series 2000. The Las Vegas
Monorail Co. is the nonprofit public-benefit corporation
responsible for the project. The Rating Outlook is Negative. A
'CC' category rating means that default of some kind appears
probable.
The bonds are insured by Ambac Assurance Corporation, whose
insurer financial strength is rated 'AAA' by Fitch. Fitch does
not rate the $149.2 million in outstanding Las Vegas Monorail
project revenue bonds, 2nd tier, series 2000, and the
$48.5 million in outstanding Las Vegas Monorail project revenue
bonds, 3rd tier, series 2000.
Fitch's downgrade to 'CC' of the first tier bonds and Negative
Outlook reflect an extremely constrained financial environment
stemming from continued declines in monthly revenues for the first
six months of 2007 as compared to the first six months of 2006
resulting from ongoing declines in ridership and a summer fare
reduction. Fitch recognizes that the fare reduction in June
increased ridership levels, however, it still resulted in
declining fare revenues. Strong competition from buses on the Las
Vegas strip and taxis continue to contribute to the monorail's
deteriorating financial position.
Despite management's efforts to aggressively raise fares on Jan. 1
2006, fare revenues have failed to grow to levels sufficient to
pay debt service. Additionally, Fitch anticipates available
internal liquidity to be drained slightly more rapidly than was
previously estimated in October 2006, when Fitch downgraded the
bonds to 'CCC'. Fitch currently expects internal liquidity to
only last for, at best, 3 years. While June's average daily
ridership increased by 27% to 23,790 from 18,766 over last year,
primarily due to a reduction in the unlimited daily fee to $8 from
$15, which now accounts for approximately 62% of total tickets
sold, it resulted in average daily revenues declining to $74,079
from $84,348 or 11%. The average fare in June 2007 fell to $3.11
from $4.44 in June 2006. Furthermore, year-to-date revenues have
declined to $15.5 million from $16.4 million or approximately 5%.
Ridership through June is up slightly at 2%. However, not
including the June increase, ridership was down 2.6%. Given the
trend in the first 6 months, Fitch believes there is a strong
likelihood that total fare revenues for 2007 will be lower than
last year. Fitch does note that operating expenses through the
first six months are tracking about $1 million less than budget or
about 4%.
Monorail demand is weaker than expected, in part due to the
continued lack of aggressive marketing partnerships with the
casinos. To the extent management's efforts are more successful
than in the past, liquidity may last longer. Fitch cannot rule
out the possibility of additional fare adjustments, including
reductions, to build ridership with the goal of establishing a
firm base level of demand with the potential for further growth.
Fitch believes the monorail retains some ability to increase
ridership levels, if it is perceived that the monorail provides a
superior competitive means of transportation. Management raised
fares on Jan. 1, 2006 to address lower than expected revenues,
however it has been largely unsuccessful. LVMC raised rates for
all fare classes. The single-ride fare was increased to $5 from
$3, or 67%, and multi-trip fare options were raised between 50%-
75%.
With higher than expected sensitivity to the fare increase and an
overall lower base of ridership, fare revenues continue to be
insufficient to meet the monorail's debt service obligations.
Internal liquidity consisting of general reserve funds, primarily
excess construction funds, totaling approximately $12.5 million,
the first-tier bonds debt service reserve fund of $42 million and
the second-tier bonds debt service reserve fund of $14.3 million
all provide an important offset to lower than expected fare
revenues and are available to pay debt service. However, due to
continued declines in ridership and revenues, Fitch estimates that
fare revenues combined with internal liquidity will likely not be
adequate to meet first-tier bonds debt service obligations beyond
2009-2010, while the second-tier bonds would encounter payment
problems earlier. Based on this analysis, resources would not be
sufficient to make third-tier bonds debt service payments, which
begin in 2012. Debt service payment problems may be deferred with
better than expected ridership and revenue levels. While, LVMC is
required to set rates so that revenues available after operations
and maintenance expenses cover first-tier bonds debt service at
least 1.4 times and all debt service obligations by 1.1x, it is
unlikely that LVMC will be able to meet this covenant for the
foreseeable future given the significantly lower than expected
financial performance.
The first-tier bonds are limited obligations payable from monorail
fare and other operating revenues after operations and maintenance
expenses and prior to the payment of second- and third-tier bonds.
The monorail project consists of the upgrade of an existing 0.8-
mile monorail between the MGM Grand Hotel and Casino to Bally's
Hotel and Casino and construction of three miles of new guideway
from Bally's north to the Sahara Hotel and Casino. Seven stations
are located along the alignment serving major hotels, attractions,
and the Las Vegas Convention Center along the Las Vegas Strip.
Monorail management continues to analyze plans to extend the
monorail to Las Vegas McCarran International Airport in order to
enhance ridership.
LEHMAN XS: Moody's Assigns Low-B Ratings to Two Certificates
------------------------------------------------------------
Moody's assigned ratings ranging from Aa1 to Ba3 to the mezzanine
certificates in the deal. Moody's Investors Service also assigned
a Aaa rating to the senior certificates issued by Lehman XS Trust
Series 2007-11.
The securitization is backed by Lehman Brothers Bank FSB and other
mortgage lenders originated, adjustable-rate and fixed-rate, alt-a
mortgage loans acquired by Lehman Brothers Holdings Inc. The
ratings are based primarily on the credit quality of the loans and
on protection against credit losses provided by subordination,
excess spread, and overcollateralization. The senior certificates
also benefit from interest-rate swap and interest-rate cap
agreements, both provided by Swiss Re Financial Products
Corporation. Moody's expects collateral losses to range from
1.25% to 1.45%.
Aurora Loan Services LLC will act as a master servicer. Moody's
assigned Aurora its servicer quality rating of SQ1- as a master
servicer.
The complete rating actions are:
Lehman XS Trust 2007-11
Mortgage Pass-Through Certificates, Series 2007-11
-- Cl. A1, Assigned Aaa
-- Cl. A2, Assigned Aaa
-- Cl. A3, Assigned Aaa
-- Cl. A4, Assigned Aaa
-- Cl. A5, Assigned Aaa
-- Cl. AIO, Assigned Aaa
-- Cl. M1, Assigned Aa1
-- Cl. M2, Assigned Aa2
-- Cl. M3, Assigned Aa3
-- Cl. M4, Assigned A1
-- Cl. M5, Assigned A2
-- Cl. M6, Assigned A3
-- Cl. M7, Assigned Baa1
-- Cl. M8, Assigned Baa2
-- Cl. M9, Assigned Baa3
-- Cl. M10, Assigned Ba2
-- Cl. M11, Assigned Ba3
LEVEL 3: Buys Dublin-based Servecast for $45 Million in Cash
------------------------------------------------------------
Level 3 Communications, Inc.'s operating subsidiary has acquired
Servecast Limited, a Dublin-based provider of live and on-demand
video management and streaming services for broadband and mobile
platforms. Level 3 has paid approximately EUR33 million, the
equivalent of approximately $45 million, in cash to complete the
acquisition of Servecast.
Founded in 1998, Servecast offers proven publishing and
distribution tools for video rights holders to monetize their
digital assets. These tools enable customers to manage, protect,
deliver and track online audio and video content. Servecast
provides an easy-to-use platform that supports multiple stream
rates, languages, currencies and formats, including Adobe
Flash(TM), Real Player(TM), Windows Media Player(TM) and Apple
QuickTime(TM). Servecast's capabilities have been developed for
easy adaptation to emerging video formats and other content
delivery technology.
"Servecast's video and rights management platform, combined with
its streaming services complement Level 3's existing portfolio of
content delivery capabilities," Brady Rafuse, president of Level
3's Content Markets Group and European Markets Group, said. "The
addition of these services accelerates our planned development of
this technology. These capabilities will enable us to manage and
distribute online video content in multiple formats to meet the
increasing demand for high-quality video over the Internet."
"We are excited to be joining Level 3," Darach Deehan, chief
executive officer of Servecast, said. "We believe Level 3's scale
and capabilities across Europe and North America will provide our
customers an important opportunity to access new markets."
"We are confident in our ability to continue offering Servecast's
customers high-quality service as we incorporate these key
capabilities into our portfolio and expand the availability of
these services to additional markets in Europe and into new
markets in North America," Mr. Rafuse added. "This is a strategic
capabilities acquisition that does not require the type of
physical integration associated with our larger, previously
announced metro and backbone transactions."
Level 3 plans to maintain Servecast's headquarters and broadcast
operations center in Dublin, as well as its data centers in London
and Amsterdam. Servecast's existing streaming server sites
throughout Europe and North America will also be incorporated into
Level 3's Content Delivery Network.
Servecast had approximately $5 million in annual revenue for 2006.
IBI Corporate Finance advised Servecast in relation to the
transaction.
About Level 3
Headquartered in Broomfield, Colorado, Level 3 Communications Inc.
(Nasdaq: LVLT) -- http://www.level3.com/-- is an international
communications company. The company provides a comprehensive
suite of services over its broadband fiber optic network including
Internet Protocol (IP) services, broadband transport and
infrastructure services, colocation services, voice services and
voice over IP services.
* * *
Level 3 Communications Inc. and wholly owned subsidiary, Level 3
Financing Inc., holds Standard & Poor's Rating Services' 'B-'
corporate credit rating. The outlook is stable.
The company's new $1 billion term loan carries Moody's Investors
Service's B1 rating and the company's $1 billion fixed and
floating rate notes at its Financing subsidiary carry Moody's B3
rating. It also bears Moody's Caa1 corporate family rating with a
stable outlook.
LIVE NATION: S&P Rates $200 Million Sr. Convertible Notes at B
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' rating to
$200 million of senior convertible notes due 2027 proposed by the
concert promoter, producer, and venue operator for live
entertainment, Live Nation Inc. (B+/Negative/--), which is
analyzed on a consolidated basis with its operating subsidiary,
Live Nation Worldwide Inc.
S&P expect proceeds from the proposed notes issuance to be used to
repay the outstanding balance on Live Nation's existing credit
facility, to pay down a portion of the existing term loan B, and
for general corporate purposes. Pro forma for the proposed
transaction, Beverly Hills, California-based Live Nation had
$884 million of total debt outstanding, including preferred stock
and four-quarter-average letters of credit, as of March 31, 2007.
"The rating on Live Nation reflects financial risk from a high
lease-adjusted debt to EBITDA ratio," said Standard & Poor's
credit analyst Michael Altberg. "It also reflects EBITDA levels
subject to general economic trends, talent costs, and the success
of concert schedules; volatile attendance trends; and limited
potential for margin expansion."
These factors are only partially offset by the company's strong
competitive position in the live-entertainment industry, its
significant geographic and format diversity, and historically
positive discretionary cash flow.
Pro forma for the proposed transaction, lease-adjusted total debt,
including $40 million in preferred stock and four-quarter-average
letters of credit, to EBITDA was approximately 6.1x at March 31,
2007. S&P's intermediate-term target lease-adjusted debt, plus
preferred stock and four-quarter-average letters of credit, to
EBITDA ratio for Live Nation is less than 5x at the current rating
level, recognizing the company's lower debt capacity because of
its high business risk. Achieving this target will require Live
Nation to increase EBITDA and apply asset sale proceeds from the
potential sale of its theater business and selected amphitheater
venues to debt repayment.
Ratings List
Live Nation Inc.
Corporate Credit Rating B+/Negative/--
New Rating
Live Nation Inc.
$200 Million Senior Convertible Notes B
LNR CDO: S&P Puts Low-B Ratings on Three Certificate Classes
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to LNR CDO VI Ltd./LNR CDO VI LLC's $1.1 billion CDO
series 2007-2.
The preliminary ratings are based on information as of July 10,
2007. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect the credit support provided by the
subordinate classes of securities and the geographic and property
type diversity of the mortgaged properties securing the underlying
CMBS collateral. The initial collateral pool consists of 122
classes of pass-through certificates taken from 24 CMBS
transactions.
Preliminary Ratings Assigned
LNR CDO VI Ltd./LNR CDO VI LLC
Class Rating Amount
----- ------ ------
A AAA $242,084,000
B AA $132,558,000
C A+ $149,951,000
D A $25,995,000
E A- $21,476,000
F BBB+ $44,195,000
G BBB $28,825,000
H BBB- $24,631,000
J BB+ $55,280,000
K BB $39,459,000
L BB- $15,456,000
Preferred shares NR $322,958,546
NR -- Not rated.
NETWORK COMMUNICATIONS: Moody's Affirms B1 Corporate Family Rating
------------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to Network
Communications, Inc.'s proposed $111.7 million senior secured loan
facilities and affirmed its B1 Corporate Family and Probability of
Default ratings in connection with management's plans to refinance
existing debt and fund a pending acquisition.
Details of the rating action are:
Rating assigned:
-- $76.7 million senior secured term loan due 2012 -- Ba1, LGD 2,
13%
-- $35 million senior secured revolving credit facility due 2010
-- Ba1, LGD 2, 13%
Ratings affirmed :
-- $175 million senior notes due 2013 -- B2, LGD 4, 65%
-- Corporate Family rating -- B1
-- Probability of Default rating -- B1
Ratings affirmed, subject to withdrawal at closing:
-- $35 million senior secured revolving credit facility
-- $47 million senior secured term loan
Moody's does not rate $32 million in senior subordinated notes of
NCI's parent, Gallarus Media Holdings, Inc.
The rating outlook is stable.
The B1 Corporate Family rating reflects NCI's high leverage, its
vulnerability to real estate sales and real-estate advertising
spending, strong competition from a number of better capitalized
rivals, reliance upon two titles for around 74% of its sales,
dependence upon acquisitions and new market launches for a
significant contribution towards its recent growth.
The rating also recognizes that a recent decline in the number of
licensed real estate brokers in the US will likely lead to a
shrinkage in NCI's addressable customer base. The rating is
supported by the market share and reputation of NCI's flagship
publication, The Real Estate Book, the defensibility of its
locally- based business, the wide geographic range of its markets,
the diversification of its real estate advertiser base, and its
low-cost distribution model.
Headquartered in Lawrenceville, Georgia, Network Communications,
Inc. is a publishing and printing company with sales of
$204 million in fiscal 2007.
NEW CENTURY: Terminates $150 Million DIP Credit Facility
--------------------------------------------------------
New Century Financial Corp. and certain of its subsidiaries
disclosed in a regulatory filing with the Securities and Exchange
Commission that they terminated on June 29, 2007, their
$150,000,000 DIP Loan and Security Agreement with Greenwich
Capital Financial Products, Inc., as lender and administrative
agent, and The CIT Group/Business Credit, Inc., as lender and
documentation agent.
Holly Etlin, NCFC's president, chief executive officer, and chief
restructuring officer, stated that at the time of termination, no
amounts were outstanding under the DIP Credit Facility. She
added that no early termination fees were required to be paid by
the company in connection with the termination.
Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation. The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
NEW CENTURY: Completes Sale of Servicing Assets to Carrington
-------------------------------------------------------------
New Century Financial Corp. disclosed that the sale of the
Servicing Assets to Carrington closed on June 29, 2007, according
to a regulatory filing with the Securities and Exchange
Commission.
New Century Financial Corp. and its subsidiary, New Century
Mortgage Corporation, entered into a Second Amended and Restated
Asset Purchase Agreement with Carrington Capital, LLC, and its
affiliate for the sale of servicing assets and servicing platform
to Carrington for approximately $184,000,000.
Holly Etlin, president, chief executive officer, and chief
restructuring officer of NCFC, stated that after giving effect to
certain closing adjustments, the net purchase price paid by
Carrington was $177,400,000, including approximately $5,000,000
deposited by Carrington into an escrow account, to indemnify it
for certain claims that may be made under the Servicing Assets
Agreement.
The balance of the escrow account after reimbursement of any
claims submitted by Carrington will be paid to NCFC nine months
after the closing of the Servicing Assets sale, Ms. Etlin said.
Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation. The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
NORTHWEST AIRLINES: Jim Greenwald to Retire Effective July 31
-------------------------------------------------------------
Northwest Airlines Corp. said yesterday that two executive
appointments resulting from the retirement of a key executive who
was instrumental in the design and construction of nearly
$3 billion of facilities, including the 125-gate Northwest
WorldGateway Terminal at Detroit Metro Airport, and in
restructuring the airline's real estate portfolio in bankruptcy.
Jim Greenwald, vice president - facilities and airport affairs,
has elected to retire from Northwest effective July 31.
Mr. Greenwald rejoined Northwest in December 2005 to assist the
company in its facilities and airport restructuring efforts.
Mr. Greenwald had previously retired from Northwest in early 2005.
"Northwest's state-of-the-art WorldGateway Terminal complex at
Detroit is a fitting tribute to the many contributions Jim has
made to Northwest during his 14-year career at the airline. His
tremendous dedication and attention to detail are exemplified by
the recent number two ranking of Detroit Metro Airport by J.D.
Powers & Associates. Jim managed the design and construction of
one of the most functional and beautiful airports in the world,"
Doug Steenland, Northwest president and chief executive officer,
said. "His steady hand will be missed and we certainly wish Jim
well in retirement."
Barry Hofer, vice president - financial planning & analysis, has
been named to succeed Mr. Greenwald. In his new role, Mr. Hofer
will report to Dave Davis, executive vice president and chief
financial officer, and will be responsible for negotiation of all
airport leases, corporate real estate, and worldwide design and
construction programs. He has been with Northwest since 1994, and
worked in a variety of marketing and financial planning roles.
"Barry's extensive experience in airline market planning and
financial analysis has prepared him to assume this key position as
Northwest's network continues to evolve in response to customer
demand," Mr. Davis said.
Prior to joining Northwest, Mr. Hofer held various positions at
KPMG Peat Marwick. He earned a master of business administration
degree from the University of Michigan, and a bachelor of science
degree in finance from Kansas State University.
Terry Mackenthun, managing director - financial planning &
analysis, has been named vice president - financial planning &
analysis, succeeding Hofer. Mackenthun, who joined Northwest in
1994, has held a number of key finance and marketing positions
with the airline and was named a managing director in 2005.
"Terry played a key role in our successful restructuring efforts,
including creation of the company's multi-year business plan and
the renegotiation of our regional airline service agreements.
During his 13 years with Northwest, he has held a number of key
positions in finance and marketing which have prepared him to take
on a leadership role in our finance organization," Davis added.
Prior to joining Northwest, Mackenthun was a senior auditor for
Ernst & Young LLP. He received his bachelor of arts degree in
accounting and finance, summa cum laude, from Augsburg College.
Mackenthun will also report to Davis.
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.
NUTRO PRODUCTS: Notes Redemption Cues S&P to Withdraw Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings on City of
Industry, California-based Nutro Products Inc. following the
acquisition of the company by Mars Inc. and redemption of the
company's $165 million float notes due 2013 and $150 million
10.75% notes due 2014, on July 9, 2007.
Ratings List
Nutro Products Inc.
Not Rated Action; CreditWatch Action
To From
-- ----
Corporate Credit Rating NR B-/Watch Pos/--
Senior Secured
Local Currency NR B/Watch Pos
Senior Unsecured
Local Currency NR CCC/Watch Pos
Subordinated NR CCC/Watch Pos
PAN AMERICAN: Inks Supply Agreement with Allis-Chalmers' DLS Unit
-----------------------------------------------------------------
Allis-Chalmers Energy Inc. reported that DLS Drilling Logistic &
Services Corporation, its wholly-owned subsidiary based in Buenos
Aires, Argentina, has reached a preliminary agreement in principle
with its most significant customer, Pan American Energy LLC, to
supply and operate 17 additional rigs for operation in the Cerro
Dragon area in southern Argentina.
DLS currently has a contract with Pan American in the Golfo San
Jorge area under which it provides 31 rigs, consisting of
9 drilling and 22 service rigs. DLS expects to supply the
additional rigs to Pan American pursuant to an anticipated
amendment to their strategic alliance agreement, which would also
be extended for a new five year term. Allis-Chalmers expects to
invest about $80 million in new equipment under this amended
agreement. Financing is anticipated primarily from DLS's cash
flow from operations and DLS's credit facilities.
The equipment is expected to be delivered in stages throughout
2007 and 2008 with the first of the 14 service rigs to be
delivered in October 2007 and the 3 drilling rigs anticipated to
be delivered in the fourth quarter of 2008.
On a preliminary basis, Allis-Chalmers estimates that the
additional rigs would contribute revenues of about $200 million
over the five year term of the contract amendment.
Micki Hidayatallah, Allis-chalmers' chairman and chief executive
officer, stated, "We are excited about the opportunity to expand
our mutually beneficial relationship with Pan American, our
largest customer in Argentina. We look forward to continuing to
build on our relationships in this region and we appreciate the
confidence Pan American has shown in us by expanding our
association."
About DLS
Through DLS, Allis-Chalmers provides drilling, completion and work
over services in Argentina and Bolivia, and other services such as
drilling and completion fluids. DLS currently operates a fleet of
52 rigs, including 21 drilling rigs, 18 work over rigs and
13 pulling rigs.
About Allis-Chalmers
Allis-Chalmers Energy Inc. (NYSE: ALY) -
http://www.alchenergy.com/-- is a Houston based multi-faceted
oilfield services company. It provides services and equipment to
oil and natural gas exploration and production companies,
domestically in Texas, Louisiana, New Mexico, Colorado, Oklahoma,
Mississippi, Utah, Wyoming, Arkansas, Alabama, West Virginia,
offshore in the Gulf of Mexico, and internationally primarily in
Argentina and Mexico. Allis-Chalmers provides rental services,
international drilling, directional drilling, tubular services,
underbalanced drilling, and production services.
About Pan American
Pan American Energy LLC is the second largest oil and gas producer
in Argentina. Also, PAE performs exploration and production
activities in Bolivia. Total FY06 production of 242 thousand
barrels of oil equivalent per day was split 51:49 between oil and
gas. Bolivia represented 23% of proved reserves and 10% of both
production and revenues at FY06. The proved reserve life is
14 years and 60% of reserves are developed. Outside E&P, other
assets include participation in oil transportation, storage and
loading, gas distribution and power generation in Argentina,
Uruguay and Bolivia. Created in 1997 as a Delaware holding
company, PAE is owned 60% by BP and 40% by Bridas. The Argentine
Branch has historically been PAE's primary subsidiary both in
terms of assets and revenues and the entity that assumes most of
the financial debt for the whole group.
* * *
As reported in the Troubled Company Reporter on June 12, 2007,
Fitch Ratings has upgraded the foreign currency Issuer Default
Rating of Pan American Energy LLC to 'BB' from 'BB-' and the local
currency IDR to 'BB+' from 'BB'. In conjunction with this action,
Fitch has upgraded the following debt instruments and
subsidiaries. The Rating Outlook for all IDRs is Stable.
Approximately $1 billion of debt securities are affected.
PATRICK FAMILY: S&P Cuts Rating on 2005A Revenue Bonds to BB
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Patrick
Family Housing, LLC's, Florida's taxable military housing revenue
bonds to 'BBB' from 'AA' (series 2005A), to 'BB' from 'A'
(series 2005B), and to 'B' from 'BBB' (series 2005 C). At the
same time, Standard & Poor's placed the ratings on CreditWatch
with developing implications.
"The rating actions reflects the financial weaknesses of the
transaction as indicated by our projections of debt service
coverage of 1.10x for series 2005A, 0.88x for series 2005B, and
0.85x for series 2006C based on 2006 unaudited financial
statements," said Standard & Poor's credit analyst Mikiyon
Alexander. "Contributing factors to the financial stresses
include a significant delay in construction completion, lower-
than-expected net operating income, the diminishment of
capitalized interest in 2007, and cost overruns."
Factors that could lead to a rating upgrade include debt service
coverage higher than projected after release and review of audited
financial statements and a recovery plan finalized in the near
future. Factors that could lead to a further downgrade include
debt service coverage lower than anticipated, invasion of the debt
service reserve fund, and failure to finalize a recovery plan.
S&P's discussions with the Air Force and the developer indicated
that a recovery plan is contemplated but has not been finalized at
this time. Despite the financial weaknesses, S&P still believe
that Patrick Air Force Base has high military essentiality. In
addition, Patrick Family Housing, LLC has experienced marginal to
high increases in the basic allowance for housing with an increase
of 6% from 2006 to 2007.
PHELPS DODGE: Fitch Upgrades Ratings on Four Senior Notes to BB
---------------------------------------------------------------
Fitch Ratings upgrades these ratings of Freeport-McMoRan Copper &
Gold Inc. and its subsidiary Phelps Dodge:
FCX
-- $1 billion Secured Bank Revolver to 'BB+' from 'BB';
-- 6.875% secured notes due 2014 to 'BB+' from 'BB';
-- Unsecured notes due 2015 and 2017 to 'BB' from 'BB-';
-- 7% convertible notes due 2011 to 'BB' from 'BB-'.
Phelps Dodge
-- 8.75% senior unsecured notes due 2011 to 'BB' from 'BB-';
-- 7.125% senior unsecured debentures due 2027 to 'BB' from
'BB-';
-- 9.50% senior unsecured notes due 2031 to 'BB' from 'BB-';
-- 6.125% senior unsecured notes due 2034 to 'BB' from 'BB-'.
In addition, Fitch affirms these ratings on FCX:
-- Issuer Default Rating at 'BB';
-- $500 million PT Freeport Indonesia/FCX Secured Bank
Revolver at 'BBB-';
-- Convertible Preferred Stock at 'B+'.
Fitch also assigns a rating of 'BB+' to FCX's new $2.45 billion
five-year term loan A. Proceeds of the loan were used to repay
the $2.45 billion remaining under the term loan due March 2014.
The term loan amortizes at 10% per annum with the remainder due at
maturity.
The Rating Outlook remains Positive.
Fitch estimates pro forma June 30, 2007 debt at $10 billion (down
from $12 billion) and latest 12 months ended June 30 EBITDA at $9
billion for total debt/EBITDA of 1.1 times. If copper prices
remain at $3/lb on average for the remainder of the year, the
year-end debt level should be reduced to about $9 billion.
The ratings reflect FCX's position as the world's second largest
copper producer, its diversified operations and strong liquidity
as well as the company's exposure to copper prices and its
relatively high financial leverage. The outlook is for copper
producers to continue to benefit from a strong pricing environment
over the near term.
POLYONE CORPORATION: Moody's Lifts Corporate Family Rating to B1
----------------------------------------------------------------
Moody's Investors Service raised the corporate family rating and
probability-of-default rating of PolyOne Corporation to B1 from B2
following the company announcement that it has sold its 24%
interest in Oxy Vinyls, LP to Occidental Chemical Corporation, a
wholly owned subsidiary of Occidental Petroleum Corporation, for
roughly $250 million and will use the proceeds to repay debt.
Moody's also raised the rating of PolyOne's unsecured debt to B1
from B2. The company's rating outlook is stable.
PolyOne's upgrade reflects the significant reduction in interest
expense expected from this transaction allowing earnings from the
company's wholly-owned operations, excluding extraordinary items,
to exceed interest expense for the first time in several years.
In addition, it removes the refinancing risk related to the
$240 million debt maturity in 2010. However, it also eliminates
the largest single cash flow stream for the company over the past
three years.
"This transaction is a net credit positive for the company as
Moody's had expected the dividend stream from OxyVinyls to fall
significantly over the next several years due to overcapacity in
North American and global PVC markets" stated John Rogers Senior
Vice President at Moody's.
The B1 CFR is supported by relatively strong credit metrics due to
the upcycle in its PVC and chlor alkali joint ventures over the
past four quarters, with Debt/EBITDA of 3.6 times and Retained
Cash Flow/Debt of 19%. The ratings are constrained due to the
company's weak operating margins, the volatility in its joint
venture earnings and continuing weakness in its North American
operations.
The stable outlook reflects the expectation that earnings could
fall modestly due to a slow down in the US industrial economy and
continuing weakness in the US housing market over the next 12
months. If the company were able to maintain operating profits at
or above the current level and produce meaningful levels of free
cash flow from its wholly-owned operations over the next 12 -18
months, Moody's could assess the appropriateness of a higher
rating. However, if interest coverage from its wholly-owned
operations falls below 1 time, Moody's would likely consider a
change in the outlook or a negative rating action.
Ratings Upgraded:
Issuer: PolyOne Corporation (includes predecessor companies MA
Hanna Company and Geon Company)
-- Corporate Family Rating to B1 from B2
-- Probability of Default Rating to B1 from B2
-- Senior Unsecured Regular Bond/Debenture to B1 (LGD4, 57%) from
B2 (LGD4, 59%)
-- Senior Unsecured Global Notes to B1 (LGD4, 59%) from B2 (LGD4,
59%)*
* the rating on these notes will be withdrawn upon repayment.
PolyOne Corporation, headquartered in Cleveland, Ohio, is a custom
compounder of PVC and other thermoplastic resins, a supplier of
additives and colorants, and a distributor of resins. PolyOne
assumed the assets and liabilities of both MA Hanna Company and
The Geon Company in 2000. PolyOne had sales of $2.6 billion for
the LTM ending March 31, 2007.
R&G FINANCIAL: HUD Strips Mortgage Unit's License to Offer Loans
----------------------------------------------------------------
R&G Financial Corporation received notice from the United States
Department of Housing and Urban Development of immediate
withdrawal of HUD-FHA Title II Approval of R&G Mortgage
Corporation to act as a HUD-FHA approved lender due to its failure
to timely submit audited financial statements.
R&G Mortgage, a wholly-owned subsidiary of the company, will not
have audited financial statements available until the company
completes its audited consolidated financial statements. The
company has previously disclosed that it is restating its
consolidated financial statements for the fiscal years 2004, 2003
and 2002 and certain selected financial information for fiscal
years 2001 and 2000.
As a result of this notification, R&G Mortgage is currently unable
to originate FHA-insured/VA-guaranteed loans. The FHA-insured/VA-
guaranteed loan production of R&G Mortgage represented about 6.3%
of the company's total Puerto Rico residential mortgage loan
production for the six months ended June 30, 2007.
The company has caused R&G Mortgage to file an appeal with HUD and
is taking other steps to try to remedy the effects of the HUD
revocation, including causing R-G Premier Bank, a Puerto Rico
chartered commercial bank and wholly-owned subsidiary of the
company, to apply to be licensed as a HUD-FHA-approved lender. As
a licensed bank lender, RG Premier would not be subject to the
audited financial statement requirements applicable to R&G
Mortgage.
Although R&G Mortgage has not received any notice threatening
revocation from other government-sponsored entities at this time,
HUD's action could cause these entities to take similar action
with respect to licenses issued by them to R&G Mortgage. In
certain cases, the loss of these licenses could prevent R&G
Mortgage from selling whole loans to, or securitizing pools of
loans through, these entities or acting as a licensed
issuer/servicer or result in breaches of certain other agreements.
The company is working to preserve its other licenses. No
assurances can be given that these efforts will be successful. If
the company is not successful in remedying the effects of the HUD
revocation and retaining these licenses, and as a result is unable
to continue participating in the origination, sale or
securitization programs maintained by these entities or servicing
loans previously originated by R&G Mortgage under such programs,
such failure would have a material adverse effect on the company.
Unwinding Transactions
In addition, the company received notice of non-objection from the
Federal Reserve Bank of New York and the Federal Deposit Insurance
Corporation to engage in what amounts to the last of its
"unwinding" transactions with other Puerto Rico financial
institutions resulting from the restatement of its audited
consolidated financial statements. In the current transaction
with Oriental Bank and Trust, a Puerto Rico-chartered
commercial bank, the terms of certain prior mortgage loan
sale transactions involving R-G Premier and Oriental Bank will be
restructured.
The transactions relate to various mortgage purchase transactions
that occurred between August 2004 and March 2005, in which
Oriental Bank purchased from R-G Premier aggregate pools of about
$114.9 million of residential mortgage loan, which were originated
by R-G Premier. The unpaid principal balance of the mortgage
loans was $71.4 million as of July 1, 2007. The purchase
transactions were initially accounted for as sales of
mortgage loans to Oriental Bank, but have been subsequently
recharacterized for accounting purposes as commercial loans
secured by the respective mortgage loans.
As part of the restructuring of the transactions, Oriental Bank
has agreed to retain certain mortgage loans with an unpaid
principal balance of $26.6 million as of July 1, 2007. Certain
mortgage loans with an unpaid principal balance of $25.9 million
as of July 1, 2007 will be substituted by R-G Premier with
mortgage loans selected by Oriental Bank that comply with its
policies. The remaining balance of the loans will be purchased by
R-G Premier for cash in the amount of $19.8 million. The
transaction closed July 10, 2007, but the settlement will be
executed on Friday, July, 13, 2007, after each party reviews the
documentation of the collateral received.
In connection with restructuring these transactions, Oriental Bank
and R-G Premier agreed to settle all pending litigation claims
relating to the payment of certain prepayment penalties associated
with the mortgage loans.
About R&G Financial
Headquartered in San Juan, Puerto Rico, R&G Financial Corp.
(PNK: RGFC.PK) -- http://www.rgonline.com/-- is a diversified
financial holding company with operations in Puerto Rico and the
United States, providing banking, mortgage banking, investments,
consumer finance and insurance through its wholly owned
subsidiaries, R-G Premier Bank, R-G Crown Bank, R&G Mortgage
Corporation, Puerto Rico's second largest mortgage banker, R-G
Investments Corporation, the Company's Puerto Rico broker-
dealer, and R-G Insurance Corporation, its Puerto Rico insurance
agency. At June 30, 2006, the Company operated 37 bank branches
in Puerto Rico, 35 bank branches in the Orlando, Tampa/St.
Petersburg and Jacksonville, Florida and Augusta, Georgia
markets, and 49 mortgage offices in Puerto Rico, including 37
facilities located within R-G Premier Bank's banking branches.
* * *
As reported in the Troubled Company Reporter on May 9, 2007,
Fitch Ratings downgraded the long-term issuer default rating of
R&G Financial Corporation to 'BB-' from 'BB'.
This downgrade reflects a longer-than-expected delay in releasing
its audited financials, regulatory and legal issues, deteriorating
operating results in 2006 and ongoing concerns regarding the mix
and level of capitalization. The Rating Outlook remains Negative.
A complete list of ratings follows this release.
REALOGY CORP: S&P Lowers Rating and Removes Negative CreditWatch
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch Negative its issue-level rating on Realogy Corp.'s
previously senior unsecured notes that were part of the company's
capital structure prior to the April 2007 going private
acquisition of the company by Apollo Management L.P. In addition,
a recovery rating was assigned to this debt. The issue-level
rating was lowered to 'BB' and a recovery rating of '1' was
assigned, indicating that lenders can expect very high (90% to
100%) recovery in the event of a payment default.
These rating actions follow Realogy's announcement that it has
closed its change of control offer for any and all of its
outstanding $250 million floating senior notes due 2009,
$450 million 6.15% senior notes due 2011, and $500 million 6.5%
senior notes due 2016. The issue-level and recovery ratings
reflect that note holders have been granted equal ranking and
share the same collateral package as the company's senior secured
credit facility. Of the $1.2 billion aggregate principal amount
of the notes outstanding, Realogy purchased approximately
$1 billion, consisting of $230 million floating senior notes,
$324 million 6.15% senior notes due 2011, and $449 million 6.5%
senior notes due 2016. To finance the purchase, the company drew
on part of its delayed-draw term loan sub-facility under its
senior secured credit facility.
Ratings List
Realogy Corp.
Corporate Credit Rating B+/Negative/--
Rating Lowered
To From
-- ----
Senior Notes BB BB+/Watch Neg
Recovery Rating 1 Not rated
RONCO CORPORATION: Section 341(a) Meeting Scheduled on August 7
---------------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of Ronco
Corporation and its debtor-affiliate, Ronco Marketing
Corporation's Creditors on Aug. 7, 2007, at 9:00 a.m., at Room
105, 21051 Warner Center Lane in Woodland Hills, California.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of
the Debtors under oath about the company's financial affairs
and operations that would be of interest to the general body
of creditors.
Headquartered in Simi Valley, California, Ronco Corporation --
http://www.ronco.com/-- engages in manufacturing, sourcing,
marketing, and distributing proprietary branded consumer products
for use in kitchen and home. The company filed for Chapter 11
protection on June 14, 2007 ( Bankr. C.D. Ca. Case No. 07-12000).
Stacia A. Neeley, Esq., at Klee, Tuchin, Bogdanoff and Stern,
L.L.P., represents the Debtor in its restructuring efforts. No
Official Committee of Unsecured Creditors has been appointed in
this case to date. When it filed for protection from its
creditors, Ronco Corp. it listed total assets of $13,879,000 and
total debts of $32,736,000. Ronco Marketing listed estimated
assets and debts between $1 million and $100 million.
RONCO CORP: Hires Kurztman Carson as Claims and Noticing Agent
--------------------------------------------------------------
The United States Bankruptcy Court fort the Central District of
California gave Ronco Corporation and its debtor-affiliate, Ronco
Marketing Corporation, permission to employ Kurtzman Carson
Consultants LLLC as their claims and noticing agent.
The firm is expected to:
a. prepare and serve required notices in these chapter 11
cases, including:
(1) a notice of the commencement of these chapter 11 cases
and the initial meeting of creditors under section
341(a) of the Bankruptcy Code;
(2) a notice of the claims bar date;
(3) notices of objections to claims;
(4) notices of any hearings on a disclosure statement and
confirmation of a chapter 11 plan or plans; and
(5) other miscellaneous notices as the Debtors or the Court
may deem necessary or appropriate for an orderly
administration of these chapter 11 cases;
b. file with the Clerk's Office a declaration of service that
includes:
(1) an alphabetical list of persons on whom KCC served the
notice, along with their addresses; and
(2) the date and manner of service;
c. maintain copies of all proofs of claim and proofs of
interest filed in these cases;
d. maintain official claims registers in these cases by
docketing all proofs of claim and proofs of interest in a
claims database that includes these information for each
the claim or interest asserted:
(1) The name and address of the claimant or interest holder
and any agent thereof, if the proof of claim or proof of
interest was filed by an agent.
(2) The date that the proof of claim or proof of interest was
received by KCC and the Court.
(3) The claim number assigned to the proof of claim or proof
of interest.
(4) The asserted amount and classification of the claim.
(5) The applicable Debtor against which the claim or interest
is asserted.
e. implement necessary security measures to ensure the
completeness and integrity of the claims register;
f. audit the claims information to assure the clerk's office
that the claims information is being appropriately and
accurately recorded in the official claims registers;
g. allow the clerk's office to independently audit the claims
information during regular business hours;
h. mail a notice of the bar date approved by the Court for the
filing of a proof of claim and a form for filing of a proof
of claim to each creditor notified of the filing;
i. transmit to the clerk's office a copy of the claims register
on a biweekly basis or at such other times as the clerk's
office may direct;
j. maintain an up-to-date mailing list for all entities that
have filed proofs of claim or proofs of interest and make
such list available upon request to the clerk's office or
any party in interest;
k. provide the public and the clerk's office access to copies
of the proofs of claim or proofs of interest filed in these
chapter 11 cases without charge during regular business
hours;
l. allow the clerk's office to inspect the firm's premises
during regular business hours; m. Record all transfers of
claims pursuant to Bankruptcy Rule 3001(e) and provide
notice of transfers as required by Bankruptcy Rule 3001(e);
n. comply with applicable federal, state, municipal and local
statutes, ordinances, rules, regulations, orders and other
requirements;
o. provide temporary employees to process claims as necessary;
p. comply with such further conditions and requirements as the
clerk's office or the Court may at any time prescribe; and
q. provide such other claims processing, noticing, and related
administrative services as may be requested from time to
time by the Debtors.
The Debtors paid the firm a $10,000 retainer.
To the Debtors' best knowledge the firm is a "disinterested
person" as defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Simi Valley, California, Ronco Corporation --
http://www.ronco.com/-- engages in manufacturing, sourcing,
marketing, and distributing proprietary branded consumer products
for use in kitchen and home. The company filed for Chapter 11
protection on June 14, 2007 ( Bankr. C.D. Ca. Case No. 07-12000).
Stacia A. Neeley, Esq., at Klee, Tuchin, Bogdanoff and Stern,
L.L.P., represents the Debtor in its restructuring efforts. No
Official Committee of Unsecured Creditors has been appointed in
this case to date. When it filed for protection from its
creditors, Ronco Corp. it listed total assets of $13,879,000 and
total debts of $32,736,000. Ronco Marketing listed estimated
assets and debts between $1 million and $100 million.
SEALY CORP: May 27 Balance Sheet Upside-Down by $144.6 Million
--------------------------------------------------------------
Sealy Corporation's balance sheet as of May 27, 2007, showed total
assets of $1 billion, total liabilities of $1.1 billion, and total
stockholders' deficit of $144.6 million.
As of May 27, 2007, Sealy's cash and cash equivalent balance was
$21.7 million versus $24.2 million as of May 28, 2006.
Net income for the second quarter ended May 27, 2007, increased to
$16.1 million, from $126,000, for the
comparable period a year ago.
Net sales for the second quarter ended May 27, 2007, increased
6.7% to $401.8 million from $376.7 million for the comparable
period a year earlier on unit volume growth of 19.3%. Partially
offsetting this increase was a 10.6% decrease in average unit
selling price.
In addition to the previously mentioned items, second quarter 2007
operating results include a $2.6 million pre-tax gain relating to
the sale of the company's previous Orlando, Florida facility,
which has been replaced with a new leased facility, as well as
$1.7 million of pre-tax costs associated with an organizational
realignment. Second quarter 2006 operating results included pre-
tax costs of $34.2 million, or $21 million after tax, related to
the company's initial public offering and related debt repayment.
Net sales for the six months ended May 27, 2007 increased 5.4% to
$814.4 million from $772.4 million for the comparable period a
year earlier. Gross profit was $349.8 million, or 43.0% of net
sales, versus $345.3 million, or 44.7% of net sales, for the
comparable period a year earlier. Net income was $40.8 million,
versus net income of $23.1 million for the comparable period a
year ago.
A copy of the company second quarter 2007 report is available for
free at http://ResearchArchives.com/t/s?2184
"We remain focused on driving unit growth and protecting our
position with retailers as we navigate through the flame
retardancy (FR) conversion with our customers, soft industry unit
trends, growing demand for specialty products and a challenging
competitive environment," said David J. McIlquham, Sealy's
chairman and chief executive officer. "As expected, this strategy
has resulted in near-term pressure on margins and costs, but we
are operating Sealy for long-term growth and are positioning
ourselves to optimize the opportunity as the industry turns. We
are pleased with the rollout progress and early sales results of
the innovative new Stearns & Foster and Posturepedic Reserve lines
along with our increasing presence in specialty and promotional
mattresses. Later this month we will introduce an exciting
upgrade to our line of TrueForm memory foam mattresses and two new
latex models at the Las Vegas furniture show. Our product
development focus has shifted to the balance of our Sealy
Posturepedic product line, where we have begun work to enhance
these designs in order to drive additional sales and margin
expansion."
Mr. McIlquham continued, "Ongoing strength in our specialty
mattress business and solid international sales further validate
the effectiveness of Sealy's model of producing multi-technology
mattresses in a diversity of geographies. We remain committed and
focused on achieving our long-term goals and are confident there
are numerous opportunities to improve our future performance
through ongoing new product initiatives and by leveraging our
presence and capabilities on a worldwide scale."
About Sealy
Sealy Corporation (NYSE: ZZ) -- http://www.sealy.com/--
manufactures and markets a line of bedding products in the United
States and internationally, including Brazil, Italy and Thailand.
It offers mattresses and mattress foundations. The company's
innerspring bedding products are sold under Sealy, Sealy
Posturepedic, Stearns & Foster, and Bassett brand names. Sealy
also manufactures and markets visco-elastic and latex bedding
products under the TrueForm, SpringFree, Stearns & Foster,
Reflexions, Carrington Chase, MirrorForm, and Pirelli brands.
SEARS HOLDINGS: Reports Lower Sales in 9-Week Period Ended July 7
-----------------------------------------------------------------
Sears Holdings Corporation reported Tuesday domestic comparable
store sales for the nine-week period ended July 7, 2007 for its
Kmart and Sears stores. The period represents the first nine
weeks of the company's thirteen-week fiscal 2007 second quarter
which ends August 4, 2007.
For the nine-week period, Kmart comparable store sales decreased
by 3.9%, with declines across most categories. Sears domestic
comparable store sales decreased by 4.0%, with declines across
most categories partially offset by increases in women's apparel
and footwear.
While comparable store sales within home appliances declined to
a higher degree than declines recorded across most other
categories for this period, the decline in home appliances was
less than the decline experienced in this category during the
first quarter of this fiscal year.
The company anticipates that, if the sales trends experienced
during the first nine weeks of the second quarter continue
through the rest of the second quarter ending August 4, 2007,
net income will be between $160 million and $200 million. The
current year second quarter estimate includes a combined gain
of approximately $20 million pre-tax resulting from gains from
bankruptcy-related settlements and total return swap investing
activities.
For the second quarter last year, the company reported net
income of $294 million. The second quarter 2006 results included
a $36 million pre-tax gain representing the company's portion of
proceeds received during the second quarter of 2006 related to the
settlement of Visa/MasterCard antitrust litigation. Excluding the
impact of this gain, second quarter 2006 net income was
$272 million.
During the nine-week period ended July 7, 2007, the company
repurchased 2.8 million common shares at a total cost of
$484 million, or an average price of $174.67 per share. As of
July 7, 2007, Holdings had approximately 150.9 million common
shares outstanding. In addition, the company repaid approximately
$200 million of domestic debt.
Sears Holdings Chief Executive Officer Aylwin Lewis said, "We
are disappointed with our recent performance. Although we
believe our business has suffered from many of the same factors
that have led other retailers to announce disappointing results
and lowered expectations, our recent performance underscores our
ongoing need to become more relevant to consumers while improving
our discipline around expense management."
The company currently expects to end the second quarter with
approximately $2.8 billion in cash and cash equivalents, excluding
Sears Canada. The expected cash and cash equivalents balance
indicated does not give effect to any share repurchase or property
sale activities after July 7, 2007.
Holdings expects to release its second quarter financial results
on or about August 30, 2007.
Share Repurchase
The company's Board of Directors has approved the repurchase of
up to an additional $1.0 billion of the company's common shares.
The authorization is in addition to the $121 million worth of
shares that remain available for repurchase under the company's
existing repurchase program.
The shares are expected to be purchased in the open market or in
privately negotiated transactions. Timing will be dependent on
prevailing market conditions, alternative uses of capital and
other factors.
The company has repurchased approximately 13.8 million of the
company's common shares at a total cost of $1.9 billion since the
third quarter of fiscal 2005, when Holdings' repurchase plan was
first approved.
About Sears Holdings Corporation
Based in Hoffman Estates, Ill., Sears Holdings Corporation
(NASDAQ: SHLD) -- http://www.searsholdings.com-- parent of Kmart
and Sears, Roebuck and Co., is a broadline retailer with
approximately 3,800 full-line and specialty retail stores in the
United States and Canada.
SEARS HOLDINGS: Weak Performance Cues S&P's Negative Outlook
------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Hoffman
Estates, Illinois-based Sears Holdings Corp. and related entities
to negative from stable. At the same time, Standard & Poor's
affirmed its 'BB+' corporate credit and 'BBB' senior secured
ratings on the company.
The outlook revision reflects Sears Holdings' substantial revision
to second-quarter earnings guidance as a result of weakening
operating performance at both Sears and Kmart stores, and the
company's announcement that its Board of Directors had approved a
new $1 billion share repurchase program.
"Since it was formed in early 2005, Sears Holdings has done a
credible job in identifying key areas for improvement," said
Standard & Poor's credit analyst Gerald Hirschberg. "Although the
company has made a strong effort to implement programs to enhance
merchandising, marketing, in-stock positions, and labor
productivity, this apparently has not resonated with its
customers. For some time, S&P have said that success in these
areas was critical for Sears Holdings to build customer
relationships and revenue growth."
Sears Holdings also announced that its share repurchase program
had been expanded by $1 billion. This is in addition to the
$121 million still available from an existing program. In the
past, strong liquidity has been a key credit factor for Sears
Holdings. "We now anticipate that the expanded share repurchase
activity could diminish this liquidity, and that shortfalls in
earnings may significantly pare EBITDA," said Mr. Hirschberg.
SEQUA CORP: Fitch Puts B+ Issuer Default Rating on Negative Watch
-----------------------------------------------------------------
Fitch Ratings has placed Sequa Corporation and its subsidiaries on
Rating Watch Negative following the announced acquisition by The
Carlyle Group, as:
Sequa Corporation:
-- Issuer Default Rating 'B+';
-- Senior unsecured notes 'BB/RR2'.
Warwick International Group Ltd.
Chromalloy UK Ltd.
Chromalloy Holland B.V.
-- Senior secured bank credit facility 'BB+/RR1'.
The ratings cover approximately $750 million of outstanding debt.
The senior secured bank credit facility is an obligation of
several of SQA's subsidiaries, and it is guaranteed by SQA.
The rating actions follow SQA's July 9 announcement that it has
reached an agreement to be acquired by The Carlyle Group, a
private equity firm, for approximately $2.7 billion. Under the
terms of the agreement, Sequa has until Aug. 23, 2007 to solicit
other bids from third parties. If consummated, the transaction is
expected to close in the fourth quarter of 2007.
The Negative Rating Watch reflects uncertainty regarding the final
financing arrangements and potential changes to SQA's capital
structure which could meaningfully increase leverage. Possible
changes in the company's operating and financial strategy are also
a consideration. The Negative Rating Watch will be resolved
following Fitch's assessment of these factors before or concurrent
with the consummation or termination of the transaction.
Fitch notes that holders of both the 8.875% senior notes due 2008
($199.1 million), and the 9.0% senior notes due 2009 ($498
million) benefit from change-of-control put provisions in the
indentures which allow them to tender their notes at 101% of par.
These provisions limit some of the credit risk related to the
proposed transaction.
SQA's ratings reflect the company's improving operating results,
healthy commercial aerospace environment, liquidity, and fully
funded pension plans. SQA has a highly diversified portfolio of
subsidiaries across products and geographies, reducing the
concentration risk of individual operating businesses. Fitch's
concerns are focused on high leverage and negative free cash flow
since 2002.
SEQUA CORP: $2.7 Billion Carlyle Deal Cues S&P's Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'BB-' corporate credit rating, on Sequa Corp. on CreditWatch
with negative implications. About $700 million of debt is
affected.
"The CreditWatch placement follows Sequa's announcement that it
will be acquired by private equity firm Carlyle Group in a
transaction valued at $2.7 billion, including $700 million of
debt," said Standard & Poor's credit analyst Roman Szuper. "The
acquisition, expected to close in the fourth quarter of 2007, is
likely to result in a more leveraged capital structure."
If Sequa's outstanding senior unsecured notes ($498 million 9% due
2009 and $199 million 8 7/8% due 2008) are redeemed, S&P will
withdraw its 'BB-' ratings on the notes.
New York, New York-based Sequa is a diversified industrial company
providing repair and remanufacture of blades, vanes, and other
components of gas turbine engines, particularly those used on
commercial aircraft (45%-50% of revenues), with the balance
derived from several nonaerospace businesses.
SOUNDVIEW HOME: Fitch Rates $5.7MM Class M-10 Certs. at BB+
-----------------------------------------------------------
Fitch Ratings has assigned Soundview Home Loan Trust's, asset-
backed certificates, series 2007-OPT3, which closed on July 10,
2007 these ratings:
-- $443 million classes I-A-1, II-A-1 through II-A-4 'AAA';
-- $21.5 million class M-1 'AA+';
-- $18.4 million class M-2 'AA';
-- $10.7 million class M-3 'AA-';
-- $10.2 million class M-4 'A+';
-- $9.3 million class M-5 'A';
-- $8.8 million class M-6 'A-';
-- $8.2 million class M-7 'BBB+';
-- $7.1 million class M-8 'BBB';
-- $5.9 million classes M-9 'BBB-';
-- $5.7 million privately offered class M-10 'BB+'.
The 'AAA' rating on the senior certificates reflects the 21.55%
total credit enhancement provided by the 3.8% class M-1, the 3.25%
class M-2, the 1.9% class M-3, the 1.8% class M-4, the 1.65% class
M-5, the 1.55% class M-6, the 1.45% class M-7, the 1.25 % class M-
8, the 1.05% class M-9, the 1% privately offered class M-10 and
the 2.85% initial and target overcollateralization. All
certificates have the benefit of monthly excess cash flow to
absorb losses. In addition, the ratings reflect the quality of
the loans, the soundness of the legal and financial structures,
and the capabilities of Option One Mortgage Corporation as
servicer and Wells Fargo Bank N.A. as Trustee.
The group I mortgage pool consists of adjustable-rate and fixed-
rate, first and second lien mortgage loans with a cut-off date
pool balance of $329,619,579. Approximately 25.7% of the mortgage
loans are fixed-rate mortgage loans, 74.3% are adjustable-rate
mortgage loans and 0.22% are second lien mortgage loans. The
weighted average loan rate is approximately 8.791%. The weighted
average remaining term to maturity is 358 months. The average
principal balance of the loans is approximately $217,571. The
weighted average combined loan-to-value ratio is 80.05%. The
properties are primarily located in California (22.34%), Florida
(9.56%) and New York (7.98%).
The group II mortgage pool consists of adjustable-rate and fixed-
rate, first and second lien mortgage loans with a cut-off date
pool balance of $235,639,638. Approximately 15% of the mortgage
loans are fixed-rate mortgage loans, 85% are adjustable-rate
mortgage loans and 0.27% are second lien mortgage loans. The
weighted average loan rate is approximately 8.355%. The WAM is
358 months. The average principal balance of the loans is
approximately $368,187. The weighted average CLTV is 88.75%. The
properties are primarily located in California (34.74%), New York
(14.81%), and Florida (10.08%).
All of the mortgage loans were originated by Option One Mortgage
Corporation. Incorporated in 1992, Option One began originating
and servicing subprime loans in February 1993. Option One is a
subsidiary of Block Financial, which is a subsidiary of H&R Block,
Inc.
For federal income tax purposes, multiple real estate mortgage
investment conduit elections will be made with respect to the
trust estate.
STATION CASINOS: S&P Retains Negative Watch on BB- Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services announced that its ratings for
Station Casinos Inc., including the 'BB-' corporate credit rating,
remain on CreditWatch with negative implications, where they were
initially placed Nov. 2, 2006. S&P have determined that once
potential barriers to the company's pending LBO deal have been
eliminated, S&P will lower its existing ratings by one notch,
bringing the corporate credit rating to 'B+'. In turn, the rating
on the company's senior unsecured notes will be lowered to 'B'
from 'B+' and the rating on the subordinated notes will be lowered
to 'B-' from 'B'. The rating outlook is expected to be negative,
reflecting credit measures that will be weak even for the 'B+'
rating due to the pending LBO by Fertitta Colony Partners LLC.
In addition, Standard & Poor's today assigned its issue-level and
recovery ratings to Station's proposed $500 million secured
revolving credit facility, a portion of which will be used to fund
the LBO. The loan was rated 'BB' with a recovery rating of '1',
indicating that lenders can expect very high (90% to 100%)
recovery in the event of a payment default.
In S&P's analysis of the proposed LBO transaction, S&P considered
the financing structure, which relies on the creation of an
unrestricted special purpose subsidiary that will raise up to
$2.725 billion of CMBS loans. The CMBS borrower is expected to be
secured by mortgages on Palace Station, Boulder Station, Sunset
Station, Santa Fe Station, Fiesta Ranch, and Fiesta Henderson.
The CMBS borrower will then lease these properties back to
Station, which will, in turn, sublease them to the operating
subsidiaries that have historically operated them. While the CMBS
borrower is expected to be a special purpose entity that benefits
from various structural protections in the event of a Station
Casinos bankruptcy, S&P utilized a consolidated approach with
regard to the CMBS debt when they considered the probability of
Station defaulting. This debt is ultimately repaid through lease
payments from Station and its operating subsidiaries, and the
properties are core assets with strategic importance to the
company.
S&P analysis also considered the high debt leverage stemming from
the LBO, tempered by Station's leadership position in the Las
Vegas locals market, which is supported by relatively high
barriers to entry, management's strong operating and development
track record, and the favorable growth characteristics of Las
Vegas. In addition, S&P considered the past success that Station
has had in managing Native American gaming properties, in part due
to how well its model transfers into these markets, and the number
of new Native American gaming opportunities in its pipeline.
"In resolving the CreditWatch listing, we will monitor the
progress that the parties make toward closing the transaction,
including the results of the shareholder vote scheduled for
Aug. 13, 2007, and steps made in the regulatory approval process,"
said Standard & Poor's credit analyst Craig Parmelee. "Once
sufficient barriers to closing are eliminated, and assuming that
the terms of the transaction do not change materially, we will
revise the ratings as previously discussed."
SUNCOM WIRELESS: Moody's Lifts Corporate Family Rating to Caa1
--------------------------------------------------------------
Moody's Investors Service upgraded SunCom Wireless Inc.'s
corporate family rating to Caa1 from Caa3 reflecting the
significant reduction in debt arising from the recent
implementation of a debt-to-equity exchange agreement.
At the same time, Moody's upgraded SunCom's senior secured rating
to B1 from B2, upgraded its senior subordinated rating to Caa3
from Ca, and affirmed its senior unsecured rating at Caa2.
Finally, Moody's upgraded SunCom's speculative grade liquidity
rating to SGL-2 from SGL-3 reflecting the meaningful reduction in
expected cash consumption following the implementation of the
exchange agreement. The long term ratings reflect a Caa1
probability of default and loss-given-default assessments as noted
below. This action concludes the ratings review Moody's commenced
in February 2007. The outlook is positive.
SunCom's Caa1 corporate family rating considers that its
relatively high operating costs and resulting low EBITDA margin
leave the company with significant adjusted leverage of roughly
6.5x following the implementation of the debt exchange agreement.
Furthermore, despite the reduction in interest expense, Moody's
believes SunCom's free cash flow profile is likely to remain
modestly negative for the next few years as capital expenditures
increase from sub-maintenance levels.
These ratings have been upgraded:
-- Corporate Family Rating to Caa1 from Caa3
-- $245 million Senior Secured Term Loan due 2009 to B1, LGD 1,
8% (from B2, LGD 1, 3%)
-- $5.5 million 9.375% Senior Subordinated Notes due 2011 to
Caa3, LGD 6, 96% (from Ca, LGD 5, 83% and reduced from $347
million prior to the debt exchange)
-- $7 million 8.75% Senior Subordinated Notes due 2011 to Caa3,
LGD 6, 96% (from Ca, LGD 5, 83% and reduced from $391 million
prior to the exchange)
-- Speculative Grade Liquidity Rating to SGL-2 from SGL-3
These ratings have been affirmed:
-- $715 million 8.5% Senior Notes due 2013 at Caa2, LGD 4, 63%
(from LGD 3, 37%)
The positive outlook reflects the potential that SunCom's roaming
revenues may have stabilized and several key operating metrics may
continue to improve, as evidenced by SunCom's results over the
past couple of quarters.
Moody's notes Holdings' continues to explore certain strategic
alternatives, including the possible sale of the company. Any
outcome of this initiative has not been factored into the rating
decision.
Headquartered in Berwyn, Pennsylvania, Suncom Wireless, Inc. is a
regional wireless telecommunications service provider operating in
the southeastern US and Puerto Rico.
TIAA CMBS: Fitch Upgrades Rating on Class Certificates to BB
------------------------------------------------------------
Fitch Ratings upgrades TIAA CMBS I Trust's commercial mortgage
pass-through certificates, series 2001-C1, as:
-- $14.7 million class G to 'AAA' from 'AA+';
-- $33 million class H to 'AA' from 'A-';
-- $14.7 million class J to 'A' from 'BBB';
-- $11 million class K to 'BBB' from 'BB+';
-- $14.7 million class L to 'BB' from 'B+';
-- $7.3 million class M to 'B+' from 'B';
-- $7.3 million class N to 'B' from 'B-'.
In addition, Fitch affirms the ratings on these classes:
-- $55.2 million class A-2 at 'AAA';
-- $110.4 million class A-3 at 'AAA';
-- $400 million class A-4 at 'AAA';
-- Interest only class X at 'AAA';
-- $58.6 million class B at 'AAA';
-- $51.3 million class C at 'AAA';
-- $22 million class D at 'AAA';
-- $14.7 million class E at 'AAA';
-- $18.3 million class F at 'AAA'.
Fitch does not rate the $17.5 million class O. Classes A-1 and A-5
have been paid in full.
The upgrades reflect increased credit enhancement levels due to
additional defeasance of 13 loans (8.7%), loan payoffs and
scheduled amortization since Fitch's last rating action. As of the
June 2007 distribution date, the pool's aggregate certificate
balance has decreased 41.6%, to $850.4 million from $1.46 billion
at issuance. Of the original 252 loans, 160 remain outstanding in
the pool. To date, 32 loans (34%) have defeased. There are
currently no delinquent or specially serviced loans.
The pool's property type concentrations include retail (24.7%),
multifamily (19.4%), industrial (12%), office (5.9%) and
healthcare (3.3%). Geographic concentrations include California
(12.1%), New York (6.6%), New Jersey (5.3%), and Florida (4.5%).
TOUSA INC: Moody's Junks Corporate Family Rating
------------------------------------------------
Moody's Investors Service lowered the ratings of Tousa, Inc,
including its corporate family rating to Caa2 from B3, senior
unsecured notes to Caa3 from Caa1, and senior sub debt to Ca from
Caa2. The ratings were taken off review for downgrade, concluding
the review that was commenced on March 21, 2007. At the same
time, Moody's assigned a B2 rating to the company's new
$200 million first lien term loan and a Caa2 rating to the new
$300 million second lien term loan. The ratings outlook is
negative.
In order to resolve the Transeastern joint venture situation, TOA
will use the bulk of the proceeds of its new $200 million first
lien term loan and $300 million second lien term loan to pay, at
par of $400 million, the senior lenders of the joint venture. The
mezzanine lenders of the Transeastern joint venture will receive a
combination of equity and debt securities totaling $153.75 million
and consisting of:
i. $117.5 million of 8% convertible preferred stock;
ii. $16.25 million of warrants; and
iii. $20 million of 14.75% senior subordinated PIK notes.
Given the debt and equity characteristics of the new convertible
preferred stock, it will be treated as 50% debt and 50% equity by
Moody's.
The ratings downgrades and negative outlook reflect the serious
challenges that TOA will face with the increased debt leverage in
a difficult industry environment, including these:
i. high pro forma debt leverage of approximately 71%;
ii. Moody's projected interest coverage of below 1 times in
2007;
iii. Moody's projected negative cash flow generation for all of
2007 and an uncertain 2008;
iv. the low asset coverage relative to the company's total debt;
v. the very small margin for error in order for the company to
succeed in its proposed plan.
Additionally, the ratings take into consideration the company's
long land supply of greater than seven years and significant
exposure to the Florida market.
Going forward, the ratings could be reduced again if Moody's were
to project any of these to occur:
i. the settlement currently contemplated with the Transeastern
lenders were to come apart;
ii. the company were to face any covenant compliance issues;
iii. the company were to generate more than modest losses from
continuing operations; or
iv. the company were not able to delever as currently expected.
The outlook and ratings could stabilize if the company's intended
plan is executed as proposed, if the company's debt leverage is
reduced below 65% on a sustainable basis, and if the company
starts generating strongly positive cash flow from operations.
These ratings were lowered:
-- Corporate family rating downgraded to Caa2 from B3;
-- Probability of default rating downgraded to Caa2 from B3;
-- Senior unsecured debt rating downgraded to Caa3 (LGD-5, 72%)
from Caa1 (LGD-4, 69%);
-- Senior subordinated debt downgraded to Ca (LGD-6, 91%) from
Caa2 (LGD-5, 89%).
These ratings were assigned:
-- $200 million first lien term loan, due 2012, rated B2 (LGD-2,
19%);
-- $300 million second lien term loan, due 2013, rated Caa2 (LGD-
4, 52%).
Headquartered in Hollywood, Florida, Technical Olympic USA, Inc.
builds and sells single family homes largely for the move-up
homebuyer. It also operates captive mortgage origination and
title insurance service companies. It is 67%- owned by Technical
Olympic S.A. Homebuilding revenues and covenant EBITDA for the
trailing twelve month period ended March 31, 2007 were about
$2.4 billion and $353 million, respectively.
TOWER AUTOMOTIVE: Court Confirms Chapter 11 Reorganization Plan
---------------------------------------------------------------
Tower Automotive Inc. disclosed that the U.S. Bankruptcy Court for
the Southern District of New York has confirmed its Chapter 11
Reorganization Plan yesterday, July 11, 2007.
The Court also approved the sale of substantially all of the
company's assets to an affiliate of Cerberus Capital Management,
L.P.
All classes of creditors that voted have accepted the plan.
The company expects to close the transaction by the end of July
2007.
Tower filed for Chapter 11 protection on February 2, 2005, citing
lower production volumes, rising steel prices and a complex and
unsustainable debt load. To strengthen its financial position and
realize opportunities for profitable, long-term future operations,
the company implemented a sweeping restructuring during its
reorganization process. It closed or sold 16 manufacturing plants
and consolidated production into existing facilities to improve
productivity. It also negotiated settlements with all 10 U.S.-
based labor unions, sold non-core businesses and diversified its
customer base with international automakers. As a result, Tower
expects more than half of the restructured company's revenue will
come from its international operations.
"[Yester]day, we achieved another significant milestone in our
restructuring process with the Bankruptcy Court's confirmation of
our Chapter 11 Plan," said Kathleen Ligocki, Tower Automotive's
President and CEO. "While the journey was difficult, we are
pleased to have court approval of a Plan that deals fairly and
equitably with our various constituencies while allowing Tower to
emerge as a much stronger, leaner, more agile company. Now,
backed by our new owners who have clearly demonstrated their
commitment to the auto industry, we look forward to focusing on
profitable growth with our customers around the world."
About Tower Automotive
Headquartered in Grand Rapids, Michigan, Tower Automotive Inc.
-- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ)
is a global designer and producer of vehicle structural components
and assemblies used by every major automotive original equipment
manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM,
Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo.
Products include body structures and assemblies, lower vehicle
frames and structures, chassis modules and systems, and suspension
components. The company has operations in Korea, Spain and
Brazil.
The company and 25 of its debtor-affiliates filed voluntary
chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No.
05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan
B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and
Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent
the Debtors in their restructuring efforts. Ira S. Dizengoff,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the
Official Committee of Unsecured Creditors. When the Debtors
filed for protection from their creditors, they listed
$787,948,000 in total assets and $1,306,949,000 in total
debts.
On May 1, 2007, the Debtors filed their Chapter 11 Plan of
reorganization and Disclosure Statement explaining that plan. On
June 4, 2007, the Debtors submitted an Amended Plan and Disclosure
Statement. The Court approved the adequacy if the Amended
Disclosure Statement on June 5, 2007. (Tower Automotive
Bankruptcy News, Issue No. 67; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
TPG-AUSTIN: Moody's Rates Secured Credit Facility at B1
-------------------------------------------------------
Moody's Investors Service assigned a first-time rating of B1 to
the secured credit facility of TPG-Austin Portfolio Holdings LLC,
a wholly-owned subsidiary of a joint venture between Thomas
Properties Group, Inc., California State Teachers Retirement
System and Lehman Brothers Holdings.
Moody's also assigned a B1 corporate family rating to TPG-Austin.
The rating outlook is stable. On June 1, 2007, the JV acquired
ten Class A office properties in Austin, TX from The Blackstone
Group for $1.15 billion. Thomas Properties manages the assets,
five of which are located in the Austin CBD and the remaining five
located in the northwestern suburbs.
Lehman Brothers provided bridge equity, which it plans to
syndicate to co-investors. The secured credit facility consists
of a six-year $193 million term loan, and a five-year $100 million
revolving credit facility. At the close of the transaction the
term loan was fully utilized, with the revolver remaining undrawn.
The credit facility is secured by a first priority interest in
three of the suburban assets and an equity interest in the
remaining seven assets.
According to Moody's, the B1 ratings reflects TPG-Austin's highly
leveraged capital structure, lack of unencumbered assets,
concentration in one geographic region and very low fixed charge
coverage. These credit challenges are offset by TPG-Austin's
strong competitive position in the Austin office market, as well
as the strengthening supply/demand characteristics of this market.
In addition, the office portfolio is well diversified by tenant
and industry type.
Asset quality is good and collateral coverage of the secured
credit facility is adequate. "Improving market conditions and
below market leases should enable TPG-Austin to increase operating
income and realize value from these assets," says Moody's analyst
Lori Marks. Although market fundamentals are strengthening, lease
up risk remains a concern as the portfolio is currently only 85%
leased.
The stable outlook reflects Moody's expectation that TPG-Austin
will improve portfolio occupancy while realizing solid increases
in rental revenues. The rating also reflects our expectation that
TPG-Austin will maintain a highly levered capital structure, with
substantial levels of secured debt and weak fixed charge coverage.
An upgrade would depend upon TPG-Austin successfully leasing up
the office portfolio, with the properties achieving occupancy >90%
and solid rental rate increases. Net debt to EBITDA closer to 10x
and fixed charge coverage above 1.5x would also provide support
for a ratings upgrade. A downgrade would most likely result from
a sudden downturn in the Austin market, which would hamper TPG-
Austin's ability to lease up its property portfolio. Fixed charge
coverage below .9x could also lead to a ratings downgrade.
These ratings were assigned:
TPG-Austin Portfolio Holdings LLC
-- secured term loan at B1; secured revolving credit facility at
B1;
-- corporate family rating at B1.
Thomas Properties Group, Inc., based in Los Angeles, is a full-
service real estate company that owns, acquires, develops and
manages primarily office, as well as mixed-use and residential
properties on a nationwide basis. The company's primary areas of
focus are the acquisition and ownership of premier properties,
both on a consolidated basis and through its strategic joint
ventures, property development and redevelopment, and property
management activities. At March 31, 2007, Thomas Properties had
gross assets of $637 million, and equity of about $61 million.
URS CORP: Washington Group Acquisition Waiting Period Expires
-------------------------------------------------------------
URS Corporation disclosed that the waiting period under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976 with respect to
the company's pending acquisition of Washington Group
International, Inc. has expired.
As reported in the Troubled Company Reporter on May 30, 2007, URS
and Washington Group signed a definitive agreement for the
acquisition of Washington Group by URS in a cash and stock
transaction valued at approximately $2.6 billion. The transaction
will combine two world-class engineering and construction
companies, expand the capabilities of both firms and capitalize on
their positions in important high growth sectors, including power,
infrastructure and environmental management.
The companies' combined 2006 revenues would have been
$7.6 billion, the fourth highest among U.S. publicly-traded
engineering and construction companies.
Completion of the acquisition, which is expected during the second
half of calendar year 2007, is subject to the approval of the
merger agreement by Washington Group stockholders, the approval of
URS' issuance of shares in the transaction by URS stockholders,
and satisfaction or waiver of other customary closing conditions.
About Washington Group International
Headquartered in Boise, Idaho, Washington Group International
(NYSE:WNG) -- http://www.wgint.com/-- provides the talent,
innovation, and proven performance to deliver integrated
engineering, construction, and management solutions for businesses
and governments worldwide. With more than $3 billion in annual
revenue, the company has approximately 25,000 people at work
around the world providing solutions in power, environmental
management, defense, oil and gas processing, mining, industrial
facilities, transportation, and water resources.
About URS
Headquartered in San Francisco, California, URS Corporation
(NYSE:URS) -- http://www.urscorp.com/-- offers a comprehensive
range of professional planning and design, systems engineering and
technical assistance, program and construction management, and
operations and maintenance services for transportation,
facilities, environmental, water/wastewater, industrial
infrastructure and process, homeland security, installations and
logistics, and defense systems. The company operates in more than
20 countries with approximately 29,500 employees providing
engineering and technical services to federal, state and local
governmental agencies as well as private clients in the chemical,
pharmaceutical, oil and gas, power, manufacturing, mining and
forest products industries.
* * *
As reported in the Troubled Company Reporter on June 1, 2007,
Moody's Investors Service placed the Ba1 Corporate Family Rating
and other instrument ratings of URS Corporation on review for
downgrade following its announcement that a definitive agreement
for the acquisition of Washington Group International, Inc. was
signed.
Standard & Poor's Ratings Services placed its ratings, including
its 'BB+' corporate credit rating, on URS Corp. on CreditWatch
with negative implications.
VENICE DEV'T: Section 341(a) Creditors Meeting Scheduled Today
--------------------------------------------------------------
The U.S. Trustee of Region 7 will convene a meeting of creditors
of Venice Development L.L.C., on July 12, 2007, at 1 p.m., at
Houston, 515 Rusk Suite 3401.
This is the first meeting of creditors required under 11 U.S.C.
Section 341(a) in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of the
Debtors under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
About Venice Development
Based in League City, Texas, Venice Development L.L.C. filed for
Chapter 11 bankruptcy protection on June 4, 2007 (Bankr. S.D. Tex.
Case No. 07-33722). Barbara Mincey Rogers, Esq. at Rogers,
Anderson & Bensey, P.L.L.C. is representing the Debtor in its
restructuring efforts. When the Debtor filed for bankruptcy, it
listed total assets of $14,600,000 and total debts of $7,355,843.
VENICE DEV'T: Court Approves Rogers Anderson as Counsel
-------------------------------------------------------
Venice Development L.L.C. obtained from the U.S. Bankruptcy Court
for the Southern District of Texas permission to employ Rogers,
Anderson & Bensey PLLC as its counsel.
Rogers Anderson will:
a. assist the Debtor with the resolution of all contested
claims;
b. assist the Debtor with proposing, prosecuting and
consummating the plan of reorganization prior to
confirmation of the plan;
c. prepare all appropriate pleadings required to be filed in
the case;
d. perform any other legal services that may be appropriate
in connection with the reorganization case.
Rogers Anderson is a new law firm consisting of Barbara M. Rogers,
Esq., David W. Anderson, Esq., and David E. Bensey, Esq.
The Debtor will pay Rogers Anderson on an hourly fee basis.
Ms. Rogers' hourly rate is $275, Mr. Anderson's hourly rate is
$250, and Mr. Bensey's hourly rate is $200.
The Debtor assure the Court that Rogers Anderson represent no
interest adverse to the Debtor and the Debtor-in-Possession, or to
the estate.
About Venice Development
Based in League City, Texas, Venice Development L.L.C. filed for
Chapter 11 bankruptcy protection on June 4, 2007 (Bankr. S.D. Tex.
Case No. 07-33722). Barbara Mincey Rogers, Esq. at Rogers,
Anderson & Bensey, P.L.L.C. is representing the Debtor in its
restructuring efforts. When the Debtor filed for bankruptcy, it
listed total assets of $14,600,000 and total debts of $7,355,843.
WR GRACE: Parties Balk at Exclusive Period Extension Plea
---------------------------------------------------------
The Future Claims Representative, the Official Committee of
Asbestos Personal Injury Claimants, and the Official Committee of
Asbestos Property Damage Claimants inform the Hon. Judith
Fitzgerald of the U.S. Bankruptcy Court for the District of
Delaware that since W.R. Grace & Co. and its debtor-affiliates'
exclusive period to file a plan of reorganization was extended in
September 2006, the Debtors have failed to comply with the Court's
order to "meet and continue to meet and confer on a regular basis
to try to resolve the differences of opinions and put together a
confirmable and consensual plan."
Exclusive Period Extension
As reported in the Troubled Company Reporter on June 26, 2007, the
Debtors asked the Court to further extend their exclusive period
to:
(i) file a plan of reorganization until 90 days after the
Court issues a final order on the personal injury claims
estimation trial; and
(ii) solicit acceptances of that plan until 60 days after a
reorganization plan is filed.
The Debtors contended that the trial dates for the estimation of
their personal injury liabilities will begin January 2008 and that
this trial remains the key event in their Chapter 11 cases and is
required for the confirmation of any reorganization plan. The
Debtors further contended that through the PI Estimation Trial and
other asbestos claims litigation that the issue of insolvency will
be resolved.
Responses
The lack of meaningful progress with the Asbestos Constituents
after more than six years should convince the Court that further
extensions of exclusivity will only serve to further delay the
reorganization process well into 2009 or 2010, the Asbestos
Constituents assert.
The Asbestos Constituents note that the Debtors have no real
incentive to reach a consensual agreement with them before a
decision is reached in the Personal Injury estimation trial.
The PI Committee points out that under the Debtors' Plan, PI
claimants receive no time value of money compensation for the
delay in paying the PD claims and the PI claimants cannot trade
out of their unenviable position of being an involuntary creditor
of a bankrupt entity.
The repeated extensions of exclusivity, according to the PI
Committee, have resulted in the unconscionable situation where
the PI claimants are held hostage to the Debtors' ability to
delay indefinitely their obligation to propose a plan that has
any hope of being confirmed within a reasonable time.
Accordingly, the Asbestos Constituents ask the Court to deny the
Debtors' request to extend their exclusive periods.
The Asbestos Constituents also urge the Court to set a short
briefing schedule to determine whether the Debtors' existing Plan
can be confirmed as a matter of law. The briefs should address
the legality of the two issues raised by the Debtors' Plan:
(1) The fact that asbestos claim holders are deemed unimpaired
and thus are not entitled to vote for or against the Plan;
and
(2) The presumption that deemed acceptance of unimpaired
creditors under Section 1126(f) of the Bankruptcy Code
satisfies the voting requirements of Section 524(g) of the
Bankruptcy Code.
The Asbestos Constituents propose a schedule for the submission
of briefs:
August 13, 2007 -- Debtors' opening brief due
September 4, 2007 -- Asbestos Constituents' response briefs due
September 11, 2007 -- Debtors' reply brief due
The Asbestos Constituents say the Court can hear arguments and
render a decision on whether the Debtors' Plan is confirmable
during the October 22, 2007, omnibus hearing.
Shortly thereafter, the PI Estimation Trial will commence, as
scheduled, in January 2008 and continue intermittently through
mid-April 2008. Once an estimation result is reached in mid-
2008, at the earliest, the Asbestos Constituents note that the
Court can immediately proceed to consider confirmation and a
resolution of the Debtors' Chapter 11 cases.
The U.S. Trustee agrees with the Asbestos Constituents that no
negotiations between the Debtors and their constituents have been
conducted recently, in violation of the Court's Order.
The U.S. Trustee notes that while the Debtors' creditors have not
been paid, professional fees have risen to significantly high
levels. The U.S. Trustee points out that from October 2006 to
December 2006, more than $17,000,000 in fees and expenses has
been allowed.
The U.S. Trustee believes that some type of change is needed in a
case that remains in bankruptcy for more than six years without
any resolution. A denial of another extension to exclusivity
will not cause the death knell to the Debtors' Chapter 11 cases,
the U.S. Trustee asserts.
About W.R. Grace
Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
James H.M. Sprayregen, Esq., at Kirkland & Ellis, and Laura Davis
Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub,
P.C., represent the Debtors in their restructuring efforts. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C.,
represent the Official Committee of Asbestos Personal Injury
Claimants. The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon,
LLP, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.
The Debtors' filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement. The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005. The
Debtors' exclusive period to file a chapter 11 plan expires on
July 23, 2007.
At Dec. 31, 2006, the W.R. Grace's balance sheet showed total
assets of $3,620,400,000 and total debts of $4,189,100,000. (W.R.
Grace Bankruptcy News, Issue No. 133; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
WR GRACE: FFIC & U.S. Trustee Give Responses on Washcoat Biz Sale
-----------------------------------------------------------------
Fireman's Fund Insurance Company informs the U.S. Bankruptcy Court
for the District of Delaware that proposed sale of W.R. Grace &
Co. and its debtor-affiliates' Washcoat Business contemplates the
transfer of certain rights of the Debtors' insurance policies to
Rhodia Inc.
FFIC and possibly other related insurance companies issued certain
insurance policies to the Debtors. FFIC may also be a party to
certain executory contracts pursuant Section 365 of the Bankruptcy
Code.
The Sale Motion, however, did not identify which insurance
policies will be implicated by the sale, John D. Demmy, Esq., at
Stevens & Lee, P.C., in Wilmington, Delaware, points out. Thus,
FFIC is unable to determine whether any rights under the FFIC
Agreements will be transferred or otherwise be affected by the
proposed sale.
Accordingly, FFIC asks the Court to compel the Debtors to assure
it that neither the FFIC Agreements nor any of its rights are
being assumed or assigned in connection with the proposed sale.
FFIC also asks the Court to compel the Debtors to assure it that
the proposed sale will not violate its contractual rights from
any ongoing reciprocal contractual obligations under the FFIC
Agreements.
The U.S. Trustee, on the other hand, is concerned that the
proposed Break-Up Fee may not meet the standard set out by the
Third Circuit in In re Calpine Corp. vs. O'Brien Environmental
Energy Inc., 181 F.3d 527 (3d Cir. 1999). The Third Circuit held
that break-up fees can only be rewarded after the court has
determined that the fee was an actual and necessary cost and
expense of preserving the estate.
The U.S. Trustee asserts that the Debtors proposed to sell their
Washcoat Business through a private sale, thus if no other
potential purchasers are in play, the proposed Break-Up Fee is
not warranted.
Accordingly, the U.S. Trustee asks the Court to issue a ruling
commensurate with its concern on the Break-Up Fee.
Washcoat Business Sale
As reported in Troubled Company Reporter on June 26, 2007, the
Debtors sought the Court's permission to sell the Washcoat
Business to Rhodia, free and clear of all liens and
claims through a private sale process.
The Debtor disclosed that it entered into a sale agreement with
Rhodia, Inc., who agreed to purchase the Business for
approximately $21.9 million subject to certain post-closing
adjustments through a private sale process.
Under the Sale Agreement, all of the Debtors' right, title and
interest in assets used exclusively in the Washcoat Business,
including real property, leases, machinery, equipment, inventory,
accounts receivable, books and record, software, and claims under
insurance policies will be transferred to Rhodia.
Rhodia, however, will not assume certain of the Debtors' assets,
including:
-- all of the Debtors' assets not used for the Business;
-- the Washcoat intellectual property, which is being provided
to Rhodia under a license agreement; and
-- the assets of the Debtors' silica manufacturing operations
that have shared facilities with the Washcoat Business in
Cincinnati, Ohio.
Rhodia will also assume all liabilities and obligations arising
out of the operation or ownership of the Transferred Assets post-
closing, including (i) post-closing employment liabilities and
(ii) all removal, repair or abatement-related liabilities related
to the presence of lead or asbestos in any of the buildings,
structures, improvements and fixtures in the Washcoat real
property.
Rhodia will not assume all pre-closing liabilities arising from
exposure to hazardous substance related to the Debtors'
businesses other than the Washcoat Business and all liabilities
arising out of the Transferred Assets arising on or before the
Closing Date.
The Debtors will make an offer concerning certain conditions of
employment to non-bargaining unit employees and no more than 27
bargaining unit employees, provided that the terms of the
compensation is comparable to the existing compensation to the
employees. The Debtors will also use reasonable commercial
efforts to offer a voluntary severance plan to their bargaining
unit employees located at the Cincinnati facility. Rhodia will
not assume any employee benefit plans.
The Debtors will assume and assign several executory contracts
and unexpired leases of the Washcoat Business to Rhodia.
Payments of the Cure Amounts will be shared equally between the
Debtors and Rhodia. As of June 18, 2007, the Debtors estimate
that the cure amounts for the Assumed Contracts is $0.
The Sale Agreement provides that the Debtors will indemnify
Rhodia for certain intellectual property-related indemnities for
up to five years after the Closing Date provided that the
indemnification will not exceed 15% of the Purchase Price.
In any event, the Debtors also sought the Court's permission to
pay Rhodia $547,500 as Break-Up Fee in the event they complete a
sale of the Washcoat Business to another bidder other than Rhodia.
About W.R. Grace
Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
James H.M. Sprayregen, Esq., at Kirkland & Ellis, and Laura Davis
Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub,
P.C., represent the Debtors in their restructuring efforts. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C.,
represent the Official Committee of Asbestos Personal Injury
Claimants. The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon,
LLP, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.
The Debtors' filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement. The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005. The
Debtors' exclusive period to file a chapter 11 plan expires on
July 23, 2007.
At Dec. 31, 2006, the W.R. Grace's balance sheet showed total
assets of $3,620,400,000 and total debts of $4,189,100,000. (W.R.
Grace Bankruptcy News, Issue No. 133; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
* Moody's Takes Various Rating Action on Series-2005 Transactions
-----------------------------------------------------------------
Moody's Investors Service has upgraded, downgraded and placed on
review for possible downgrade certain certificates from
transactions issued in 2005 and backed by sub-prime second lien
loans.
For the securities that are being downgraded or placed on review
for downgrade, projected pipeline losses have increased over the
past few months and are likely to affect the credit support for
these certificates. The certificates are being downgraded and
placed on review for possible downgrade based on the fact that the
bonds' current credit enhancement levels, including excess spread,
may be too low compared to the current projected loss numbers
given the current rating level.
For the certificates that are being upgraded, prepayment speeds
have been faster than originally expected. The faster prepayments
in addition to the sequential pay structure prior to the step down
date allow the bonds to be paid off sooner than expected.
Complete rating actions are:
Issuer: Ace Securities Corp. Home Equity Loan Trust
Downgrade
* Series 2005-SL1, Class B-1 downgraded from Caa1 to Ca
* Series 2005-SL1, Class B-2, downgraded from Caa2 to C
Review for Possible Downgrade:
* Series 2005-SL1, Class M-7, Current Rating B3, on review for
possible downgrade
Issuer: CSFB Home Equity Mortgage Trust
Upgrade
* Series 2005-3, Class M-1, upgraded from Aa1 to Aaa;
* Series 2005-3, Class M-2, upgraded from Aa2 to Aa1;
* Series 2005-3, Class M-3, upgraded from A1 to Aa2;
Downgrade and Review for Possible Downgrade
* Series 2005-3, Class B-2, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-4, Class B-2, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-5, Class B-1, downgraded from Ba1 to B2 and on
review for possible further downgrade;
Review for Possible Downgrade:
* Series 2005-4, Class M-9F, Current Rating Baa3, on review
for possible downgrade
* Series 2005-4, Class M-9A, Current Rating Baa3, on review
for possible downgrade
* Series 2005-4, Class B-1, Current Rating Ba1, on review for
possible downgrade
* Series 2005-5, Class M-9, Current Rating Baa3, on review for
possible downgrade
Issuer: First Franklin Mortgage Loan Trust
Downgrade and Review for Possible further Downgrade
* Series 2005-FFA, Class B-4 downgraded from Ba1 to B3, and on
review for possible further downgrade
Review for Possible Downgrade:
* Series 2005-FFA, Class B-3, Current Rating Baa3, on review
for possible downgrade
Issuer: GSAMP Trust
Downgrade and Review for Possible further Downgrade
* Series 2005-S1, Class B-3 downgraded from Ba1 to Caa1, and
on review for possible further downgrade
* Series 2005-S2, Class B-3 downgraded from Ba1 to B2, and on
review for possible further downgrade
Review for Possible Downgrade:
* Series 2005-S1, Class B-2, Current Rating Baa3, on review
for possible downgrade
* Series 2005-S2, Class B-2, Current Rating Baa3, on review
for possible downgrade
Issuer: Home Equity Mortgage Trust
Upgrade
* Series 2005-1, Class M-3, upgraded from Aa3 to Aaa;
* Series 2005-1, Class M-4, upgraded from A1 to Aa2;
* Series 2005-2, Class M-1, upgraded from Aa1 to Aaa;
* Series 2005-2, Class M-2, upgraded from Aa2 to Aa1;
* Series 2005-2, Class M-3, upgraded from Aa3 to Aa2;
Downgrade and Review for Possible Downgrade
* Series 2005-1, Class B-2, downgraded from Ba2 to B3 and on
review for possible further downgrade;
Issuer: Irwin Whole Loan Home Equity Trust
Upgrade:
* Series 2005-A, Class M-1 Upgraded from Aa2 to Aaa,
* Series 2005-A, Class M-2 Upgraded from A2 to Aa1,
* Series 2005-A, Class M-3 Upgraded from A3 to Aa2,
Issuer: MASTR Second Lien Trust
Upgrade:
* Series 2005-1, Class M-1 Upgraded from Aa2 to Aaa,
* Series 2005-1, Class M-2 Upgraded from A2 to Aa2,
* Series 2005-1, Class M-3 Upgraded from A3 to A1,
Issuer: Merrill Lynch Mortgage Investors Trust
Upgrade
* Series 2005-SL1, Class M-3, upgraded from A2 to Aaa;
* Series 2005-SL1, Class B-1, upgraded from A3 to Aa3;
* Series 2005-SL2, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-SL2, Class M-2, upgraded from A2 to Aa2;
Downgrade and Review for Possible Downgrade
* Series 2005-SL1, Class B-5, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-SL2, Class B-5, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-NCA, Class B-5, downgraded from Ba2 to B2 and on
review for possible further downgrade;
Review for Possible Downgrade:
* Series 2005-SL2, Class B-4, Current Rating Ba1, on review
for possible downgrade;
* Series 2005-NCA, Class B-4, Current Rating Ba1, on review
for possible downgrade;
Issuer: Morgan Stanley Mortgage Loan Trust
Downgrade and Review for Possible further Downgrade
* Series 2005-8SL, Class B-5 downgraded from Ba2 to B2, and on
review for possible further downgrade
Review for Possible Downgrade:
* Series 2005-8SL, Class B-4, Current Rating Ba1, on review
for possible downgrade;
Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust
Upgrade
* Series 2005-S2, Class M-1, upgraded from Aa2 to Aaa;
Downgrade and Review for Possible Downgrade
* Series 2005-S1, Class B-3, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-S2, Class B-3, downgraded from Ba2 to B3 and on
review for possible further downgrade;
* Series 2005-S4, Class B-5, downgraded from Ba2 to B2 and on
review for possible further downgrade;
Review for Possible Downgrade:
* Series 2005-S3, Class B-4-PO, Current Rating Ba2, on review
for possible downgrade;
* Series 2005-S4, Class B-3, Current Rating Baa3, on review
for possible downgrade;
* Series 2005-S4, Class B-4, Current Rating Ba1, on review for
possible downgrade;
Issuer: SACO I Trust
Upgrade
* Series 2005-1, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-1, Class M-2, upgraded from A2 to Aa2;
* Series 2005-2, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-2, Class M-2, upgraded from Aa3 to Aa1;
* Series 2005-2, Class M-3, upgraded from A1 to Aa2;
* Series 2005-3, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-3, Class M-2, upgraded from Aa3 to Aa1;
* Series 2005-5, Class IM-1, upgraded from Aa2 to Aaa;
* Series 2005-5, Class IM-2, upgraded from Aa3 to Aa1;
Downgrade and Review for Possible Downgrade
* Series 2005-1, Class B-3, downgraded from Ba2 to B3, and on
review for possible further downgrade;
* Series 2005-2, Class B-3, downgraded from Baa3 to B1, and on
review for possible further downgrade;
* Series 2005-3, Class B-4, downgraded from Ba2 to B3, and on
review for possible further downgrade;
* Series 2005-4, Class B-4, downgraded from Ba2 to B3, and on
review for possible further downgrade;
* Series 2005-10, Class IIB-4, downgraded from Ba1 to B2, and
on review for possible further downgrade;
Downgrade:
* Series 2005-2, Class B-4, downgraded from Ba3 to Ca;
* Series 2005-4, Class B-2, downgraded from Baa2 to Baa3;
* Series 2005-4, Class B-3, downgraded from Baa3 to Ba1;
* Series 2005-5, Class IB-4, downgraded from Ba2 to B1;
* Series 2005-6, Class B-3, downgraded from Baa3 to Ba1;
* Series 2005-6, Class B-4, downgraded from Ba2 to B2;
* Series 2005-7, Class B-3, downgraded from Baa3 to Ba1;
* Series 2005-8, Class B-3, downgraded from Baa3 to Ba1;
* Series 2005-WM1, Class B-4, downgraded from Ba1 to B1;
* Series 2005-WM1, Class B-5, downgraded from Ba2 to Caa1;
Review for Possible Downgrade:
* Series 2005-10, Class IB-4, Current Rating Ba1, on review
for possible downgrade;
* Series 2005-10, Class IIB-3, Current Rating Baa3, on review
for possible downgrade;
* Series 2005-3, Class B-3, Current Rating Baa3, on review for
possible downgrade;
* Series 2005-WM2, Class B-3, Current Rating Baa3, on review
for possible downgrade;
* Series 2005-WM3, Class B-2, Current Rating Baa2, on review
for possible downgrade;
* Series 2005-WM3, Class B-3, Current Rating Baa3, on review
for possible downgrade;
Issuer: Structured Asset Securities Corp Trust
Upgrade
* Series 2005-S1, Class M-2, upgraded from Aa1 to Aaa;
* Series 2005-S1, Class M-3, upgraded from Aa2 to Aa1;
* Series 2005-S3, Class M-1, upgraded from Aa1 to Aaa;
* Series 2005-S3, Class M-2, upgraded from Aa2 to Aaa;
* Series 2005-S3, Class M-3, upgraded from Aa3 to Aa1;
* Series 2005-S3, Class M-4, upgraded from A1 to Aa2;
* Series 2005-S3, Class M-5, upgraded from A2 to Aa3;
Downgrade and Review for Possible Downgrade
* Series 2005-S1, Class B-2, downgraded from Ba2 to B3, and on
review for possible further downgrade;
* Series 2005-S7, Class B, downgraded from Ba1 to B2, and on
review for possible further downgrade;
Downgrade:
* Series 2005-S5, Class M-8, downgraded from Baa3 to Ba2;
* Series 2005-S7, Class M-9, downgraded from Baa3 to Ba2;
Issuer: Soundview Whole Loan Trust
Upgrade:
* Series 2005-A, Class M-1 Upgraded from Aa1 to Aaa,
* Series 2005-A, Class M-2 Upgraded from Aa2 to Aaa,
* Series 2005-A, Class M-3 Upgraded from Aa3 to Aa1,
* Series 2005-A, Class M-4 Upgraded from A1 to Aa2,
* Series 2005-A, Class M-5 Upgraded from A2 to Aa3,
* Series 2005-B, Class M-1 Upgraded from Aa1 to Aaa,
* Series 2005-B, Class M-2 Upgraded from Aa2 to Aaa,
* Series 2005-B, Class M-3 Upgraded from Aa3 to Aa1,
* Series 2005-B, Class M-4 Upgraded from A1 to Aa2,
* Series 2005-B, Class M-5 Upgraded from A2 to Aa3,
Issuer: Terwin Mortgage Trust
Upgrade
* Series 2005-1SL, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-1SL, Class M-2, upgraded from A2 to Aa3;
* Series 2005-3SL, Class M-1, upgraded from Aa2 to Aaa;
* Series 2005-3SL, Class M-2, upgraded from A2 to Aa2;
* Series 2005-5SL, Class M-1a, upgraded from Aa1 to Aaa;
* Series 2005-5SL, Class M-1b, upgraded from Aa2 to Aaa;
* Series 2005-5SL, Class M-2, upgraded from Aa2 to Aa1;
Downgrade and Review for Possible Downgrade
* Series 2005-5SL, Class B-4, downgraded from Ba1 to B3, and
on review for possible further downgrade;
* Series 2005-7SL, Class B-4, downgraded from Baa3 to Ba1, and
on review for possible further downgrade;
* Series 2005-7SL, Class B-5, downgraded from Ba1 to B3, and
on review for possible further downgrade;
* Series 2005-11, Class IB-6, downgraded from Ba2 to B3, and
on review for possible further downgrade;
* Series 2005-11, Class IIB-3, downgraded from Baa2 to Ba1,
and on review for possible further downgrade;
* Series 2005-11, Class IIB-4, downgraded from Baa3 to B2, and
on review for possible further downgrade;
Downgrade:
* Series 2005-1SL, Class B-4, downgraded from Caa1 to Ca;
* Series 2005-3SL, Class B-5, downgraded from Baa3 to B1;
* Series 2005-3SL, Class B-6-PI, downgraded from Caa2 to Ca;
* Series 2005-7SL, Class B-6, downgraded from Ba2 to Ca;
* Series 2005-7SL, Class B-7-PI, downgraded from Ba3 to C;
* Series 2005-9HGS, Class B-6, downgraded from B3 to Ca;
* Series 2005-11, Class IB-7, downgraded from Ba3 to Ca;
* Series 2005-11, Class IIB-5, downgraded from Ba1 to Ca;
* Series 2005-13SL, Class B-4, downgraded from Baa3 to Ba1;
* Series 2005-13SL, Class B-5, downgraded from Ba2 to B2;
* Series 2005-13SL, Class B-6, downgraded from Ba3 to Ca;
Review for Possible Downgrade:
* Series 2005-9HGS, Class B-5, Current Rating Ba1, on review
for possible downgrade;
* Series 2005-11, Class IB-4, Current Rating Baa3, on review
for possible downgrade;
* Series 2005-11, Class IB-5, Current Rating Ba1, on review
for possible downgrade;
* Moody's Downgrades Ratings on 399 Mortgage-Backed Securities
--------------------------------------------------------------
Moody's Investors Service has downgraded 399 residential mortgage-
backed securities and placed an additional 32 RMBS under review
for possible downgrade. The transactions were issued in 2006 and
are backed primarily by first lien adjustable- and fixed-rate
subprime mortgage loans.
The ratings were placed under review and downgraded based on
higher than anticipated rates of delinquency in the underlying
collateral compared to current credit enhancement levels.
The complete rating actions are:
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-FM1
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to Ba3 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-FM2
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-7, Downgraded to Ba1 from Baa1
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-HE1
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-HE2
* Cl. M-11, Downgraded to B1 from Ba2
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-HE3
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba2 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-HE4
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba2 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-NC2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-9, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: ACE Securities Corp. Home Equity Loan Trust,
Series 2006-NC3
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Placed on Review for Possible Downgrade, currently
Baa3
Issuer: Ameriquest Mortgage Securities Inc., Series 2006-M3
* Cl. M-10, Downgraded to B1 from Ba1
Issuer: Argent Securities Trust 2006-M1
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-7, Downgraded to Baa2 from Baa1
Issuer: Argent Securities Trust 2006-M2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: Argent Securities Trust 2006-W1
* Cl. M-10, Downgraded to Ba2 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: Argent Securities Trust 2006-W2
* Cl. M-10, Downgraded to B2 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
Issuer: Argent Securities Trust 2006-W3
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
Issuer: Argent Securities Trust 2006-W4
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-7, Downgraded to Baa2 from Baa1
Issuer: Argent Securities Trust 2006-W5
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-7, Downgraded to Baa2 from Baa1
Issuer: Asset Backed Securities Corporation Home Equity Loan Trust
2006-HE2
* Cl. M10, Downgraded to B2 from Ba1
* Cl. M9, Downgraded to Ba3 from Baa3
* Cl. M11, Downgraded to Caa1 from Ba2
* Cl. M8, Downgraded to Baa3 from Baa2
Issuer: Asset Backed Securities Corporation Home Equity Loan Trust
2006-HE4
* Cl. M9, Downgraded to B3 from Ba1
* Cl. M8, Downgraded to Ba3 from Baa3
* Cl. M10, Downgraded to Caa1 from Ba2
* Cl. M7, Downgraded to Baa3 from Baa2
Issuer: Bear Stearns Asset Backed Securities I Trust 2006-HE4
* Cl. M-10, Downgraded to B1 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: Bear Stearns Asset Backed Securities I Trust 2006-HE5
* Cl. M-11, Downgraded to B2 from Ba2
Issuer: Bear Stearns Asset Backed Securities I Trust 2006-HE6
* Cl. I-M-11, Downgraded to B2 from Ba2
* Cl. II-M-11, Downgraded to B3 from Ba2
Issuer: Bear Stearns Asset Backed Securities I Trust 2006-HE7
* Cl. I-M-10, Downgraded to B1 from Ba1
* Cl. I-M-9, Downgraded to Ba1 from Baa3
* Cl. I-M-11, Downgraded to Caa1 from Ba2
Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2006-CB5
* Cl. B-3, Downgraded to Ba2 from Baa3
* Cl. B-4, Downgraded to Caa1 from Ba1
Issuer: CSFB Home Equity Asset Trust 2006-2
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-3
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-4
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-5
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-6
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-7
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CSFB Home Equity Asset Trust 2006-8
* Cl. B-3, Downgraded to B1 from Ba2
Issuer: CWABS Asset-Backed Certificates Trust 2006-10
* Cl. BV, Downgraded to Caa1 from Ba1
* Cl. MV-8, Downgraded to Ba1 from Baa2
* Cl. MV-9, Downgraded to Ba3 from Baa3
Issuer: CWABS Asset-Backed Certificates Trust 2006-11
* Cl. BV, Downgraded to B2 from Baa3
* Cl. MV-8, Downgraded to Ba2 from Baa2
Issuer: CWABS Asset-Backed Certificates Trust 2006-12
* Cl. B, Downgraded to B3 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-7, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: CWABS Asset-Backed Certificates Trust 2006-2
* Cl. B, Downgraded to Ba2 from Baa3
Issuer: CWABS Asset-Backed Certificates Trust 2006-3
* Cl. B, Downgraded to Ba2 from Baa3
Issuer: CWABS Asset-Backed Certificates Trust 2006-5
* Cl. B, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba1 from Baa2
Issuer: CWABS Asset-Backed Certificates Trust 2006-6
* Cl. B, Downgraded to Caa1 from Ba1
* Cl. M-8, Downgraded to Ba2 from Baa3
Issuer: CWABS Asset-Backed Certificates Trust 2006-7
* Cl. B, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: CWABS Asset-Backed Certificates Trust 2006-ABC1
* Cl. M-8, Downgraded to B2 from Baa2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: CWABS Asset-Backed Certificates Trust 2006-BC2
* Cl. B, Downgraded to Ba3 from Ba1
Issuer: Carrington Mortgage Loan Trust, Series 2006-NC3
* Cl. M-10, Downgraded to Ba2 from Baa3
Issuer: Citigroup Mortgage Loan Trust 2006-CB3
* Cl. B-3, Downgraded to B2 from Baa3
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-4, Downgraded to Caa1 from Ba1
Issuer: Citigroup Mortgage Loan Trust 2006-HE1
* Cl. M-11, Downgraded to B1 from Ba2
Issuer: Citigroup Mortgage Loan Trust 2006-NC1
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-7, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Citigroup Mortgage Loan Trust 2006-NC2
* Cl. M-10, Downgraded to B1 from Baa3
* Cl. M-9, Downgraded to Ba1 from Baa2
* Cl. M-11, Downgraded to Caa1 from Ba2
Issuer: Citigroup Mortgage Loan Trust Inc. 2006-WMC1
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Fieldstone Mortgage Investment Trust 2006-1
* Cl. M9, Downgraded to Ba1 from Baa3
Issuer: First Franklin Mortgage Loan Trust 2006-FF10
* Cl. B1, Downgraded to Ba3 from Ba1
* Cl. B2, Downgraded to Caa1 from Ba2
Issuer: First Franklin Mortgage Loan Trust 2006-FF11
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba1
Issuer: First Franklin Mortgage Loan Trust 2006-FF4
* Cl. B2, Downgraded to Ba1 from Ba3
Issuer: First Franklin Mortgage Loan Trust 2006-FF5
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: First Franklin Mortgage Loan Trust 2006-FF6
* Cl. B-1, Downgraded to Ba3 from Ba2
Issuer: First Franklin Mortgage Loan Trust 2006-FF7
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-7, Downgraded to Baa2 from Baa1
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: First Franklin Mortgage Loan Trust 2006-FF8
* Cl. M-10, Downgraded to B1 from Ba1
Issuer: First Franklin Mortgage Loan Trust 2006-FF9
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-7, Downgraded to Baa2 from Baa1
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: Fremont Home Loan Trust 2006-1
* Cl. M-9, Downgraded to B2 from Ba1
* Cl. B-1, Downgraded to Caa1 from Ba2
* Cl. M-7, Downgraded to Ba1 from Baa2
* Cl. M-8, Downgraded to Ba3 from Baa3
Issuer: Fremont Home Loan Trust 2006-A
* Cl. M-9, Downgraded to B2 from Ba1
* Cl. M-7, Downgraded to Ba1 from Baa2
* Cl. M-8, Downgraded to Ba3 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba2
Issuer: Fremont Home Loan Trust 2006-B
* Cl. M-9, Downgraded to B2 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-11, Downgraded to Caa2 from Ba2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: Fremont Home Loan Trust 2006-C
* Cl. M10, Downgraded to Ba3 from Ba1
* Cl. M9, Downgraded to Ba1 from Baa3
* Cl. M11, Downgraded to Caa1 from Ba2
Issuer: GE-WMC Asset-Backed Pass-Through Certificates,
Series 2006-1
* Cl. B-4, Downgraded to B3 from Ba1
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
* Cl. B-5, Downgraded to Caa1 from Ba2
Issuer: GSAMP Trust 2006-FM1
* Cl. B-2, Downgraded to B3 from Baa3
* Cl. B-1, Downgraded to Ba3 from Baa2
* Cl. B-3, Downgraded to Caa1 from Ba1
* Cl. B-4, Downgraded to Caa2 from Ba2
* Cl. M-7, Downgraded to Ba1 from Baa1
* Cl. M-6, Placed on Review for Possible Downgrade, currently
A3
Issuer: GSAMP Trust 2006-FM2
* Cl. B-1, Downgraded to B1 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: GSAMP Trust 2006-HE2
* Cl. B-5, Downgraded to B1 from Ba2
Issuer: GSAMP Trust 2006-NC2
* Cl. B-1, Downgraded to B3 from Ba1
* Cl. B-2, Downgraded to Caa1 from Ba2
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
Issuer: HASCO 2006-WMC1
* Cl. M-8, Downgraded to B3 from Baa2
* Cl. M-7, Downgraded to Ba3 from Baa1
* Cl. M-10, Downgraded to Caa3 from Ba1
* Cl. M-9, Downgraded to Caa1 from Baa3
Issuer: HSI Asset Securitization Corporation Trust 2006-HE1
* Cl. M-10, Downgraded to Ba3 from Ba1
Issuer: HSI Asset Securitization Corporation Trust 2006-HE2
* Cl. M-10, Placed on Review for Possible Downgrade, currently
Ba1
Issuer: HSI Asset Securitization Corporation Trust 2006-NC1
* Cl. M-11, Downgraded to B3 from Ba2
* Cl. M-10, Downgraded to Ba2 from Ba1
Issuer: HSI Asset Securitization Corporation Trust 2006-OPT4
* Cl. M-10, Downgraded to B1 from Ba2
Issuer: IXIS Real Estate Capital Trust 2006-HE1
* Cl. B-4, Downgraded to B2 from Ba1
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: IXIS Real Estate Capital Trust 2006-HE2
* Cl. B-3, Downgraded to B1 from Baa3
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-4, Downgraded to Caa1 from Ba1
Issuer: IXIS Real Estate Capital Trust 2006-HE3
* Cl. B-5, Downgraded to Ba3 from Ba2
Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust,
INABS 2006-A
* Cl. M-10, Downgraded to B1 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust,
INABS 2006-B
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba1 from Baa2
Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust,
INABS 2006-C
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba1 from Baa2
Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust,
Series INABS 2006-D
* Cl. M-11, Downgraded to Ba3 from Ba2
Issuer: J.P. Morgan Mortgage Acquisition Corp. 2006-FRE1
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: J.P. Morgan Mortgage Acquisition Corp. 2006-FRE2
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: J.P. Morgan Mortgage Acquisition Corp. 2006-WMC1
* Cl. M-11, Downgraded to Ba3 from Ba2
Issuer: J.P. Morgan Mortgage Acquisition Corp. 2006-WMC2
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: J.P. Morgan Mortgage Acquisition Corp. 2006-WMC3
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: J.P. Morgan Mortgage Acquisition Trust 2006-NC1
* Cl. M-10, Downgraded to B1 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
Issuer: Long Beach Mortgage Loan Trust 2006-1
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-11, Downgraded to Caa1 from Ba2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: Long Beach Mortgage Loan Trust 2006-2
* Cl. B, Downgraded to Caa3 from Ba2
* Cl. M-8, Downgraded to B2 from Baa2
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-7, Downgraded to Ba2 from Baa1
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-6, Placed on Review for Possible Downgrade, currently
A3
Issuer: Long Beach Mortgage Loan Trust 2006-3
* Cl. B, Downgraded to Caa2 from Ba2
* Cl. M-8, Downgraded to B2 from Baa2
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-7, Downgraded to Ba2 from Baa1
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-6, Placed on Review for Possible Downgrade, currently
A3
Issuer: Long Beach Mortgage Loan Trust 2006-4
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-11, Downgraded to Caa2 from Ba2
* Cl. M-7, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Long Beach Mortgage Loan Trust 2006-5
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. B-1, Downgraded to Caa2 from Ba2
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-7, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Long Beach Mortgage Loan Trust 2006-6
* Cl. M-10, Downgraded to B1 from Ba1
* Cl. M-11, Downgraded to B3 from Ba2
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Long Beach Mortgage Loan Trust 2006-7
* Cl. M-10, Downgraded to B2 from Ba1
* Cl. M-11, Downgraded to B3 from Ba2
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Long Beach Mortgage Loan Trust 2006-8
* Cl. M-10, Downgraded to B1 from Ba1
* Cl. M-11, Downgraded to B3 from Ba2
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Long Beach Mortgage Loan Trust 2006-9
* Cl. B, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Long Beach Mortgage Loan Trust 2006-WL2
* Cl. B-1, Downgraded to Ba3 from Ba1
Issuer: Long Beach Mortgage Loan Trust 2006-WL3
* Cl. B-1, Downgraded to Ba3 from Ba1
Issuer: MASTR Asset Backed Securities Trust 2006-AM2
* Cl. M-11, Downgraded to B2 from Ba2
Issuer: MASTR Asset Backed Securities Trust 2006-AM3
* Cl. M-11, Placed on Review for Possible Downgrade, currently
Ba2
Issuer: MASTR Asset Backed Securities Trust 2006-FRE1
* Cl. M-6, Downgraded to Baa3 from A3, placed on review for
possible further downgrade
* Cl. M-8, Downgraded to Caa2 from B3
* Cl. M-9, Downgraded to Ca from Caa3
* Cl. M-7, Downgraded to Caa1 from Ba1
* Cl. M-5, Placed on Review for Possible Downgrade, currently
A2
Issuer: MASTR Asset Backed Securities Trust 2006-FRE2
* Cl. M-8, Downgraded to B3 from Ba2
* Cl. M-9, Downgraded to Caa1 from B2
* Cl. M-11, Downgraded to Ca from Caa3
* Cl. M-7, Downgraded to Ba1 from Baa1
* Cl. M-10, Downgraded to Caa3 from Caa1
Issuer: MASTR Asset Backed Securities Trust 2006-HE1
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba2 from Ba1
Issuer: MASTR Asset Backed Securities Trust 2006-HE2
* Cl. M-9, Downgraded to B2 from Baa3
* Cl. M-8, Downgraded to Ba3 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-11, Downgraded to Caa2 from Ba2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: MASTR Asset Backed Securities Trust 2006-HE3
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
* Cl. M-11, Downgraded to Caa1 from Ba2
Issuer: MASTR Asset Backed Securities Trust 2006-HE4
* Cl. M-11, Placed on Review for Possible Downgrade, currently
Ba2
Issuer: MASTR Asset Backed Securities Trust 2006-HE5
* Cl. M-11, Placed on Review for Possible Downgrade, currently
Ba2
Issuer: MASTR Asset Backed Securities Trust 2006-NC1
* Cl. M-11, Downgraded to B2 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: MASTR Asset Backed Securities Trust 2006-NC2
* Cl. M-11, Downgraded to B3 from Ba2
* Cl. M-10, Downgraded to Ba3 from Ba1
* Cl. M-9, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: MASTR Asset Backed Securities Trust 2006-NC3
* Cl. M-11, Placed on Review for Possible Downgrade, currently
Ba1
Issuer: MASTR Asset Backed Securities Trust 2006-WMC1
* Cl. M-10, Downgraded to B2 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
Issuer: MASTR Asset Backed Securities Trust 2006-WMC2
* Cl. M-8, Downgraded to B1 from Baa2
* Cl. M-7, Downgraded to Ba2 from Baa1
* Cl. M-10, Downgraded to Caa3 from Ba1
* Cl. M-9, Downgraded to Caa1 from Baa3
* Cl. M-6, Placed on Review for Possible Downgrade, currently
A3
Issuer: MASTR Asset Backed Securities Trust 2006-WMC3
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba1
Issuer: MASTR Asset Backed Securities Trust 2006-WMC4
* Cl. M-11, Placed on Review for Possible Downgrade, currently
Ba2
Issuer: Merrill Lynch Mortgage Investors Trust 2006-AHL1
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Merrill Lynch Mortgage Investors Trust 2006-AR1
* Cl. B-4, Downgraded to B1 from Ba1
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Merrill Lynch Mortgage Investors Trust 2006-FM1
* Cl. B-3, Downgraded to B2 from Baa3
* Cl. B-2, Downgraded to Ba2 from Baa2
Issuer: Merrill Lynch Mortgage Investors Trust 2006-RM1
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Merrill Lynch Mortgage Investors Trust 2006-RM2
* Cl. B-4, Downgraded to Ba3 from Ba1
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Merrill Lynch Mortgage Investors Trust 2006-RM4
* Cl. B-4, Downgraded to Ba3 from Ba1
Issuer: Merrill Lynch Mortgage Investors Trust 2006-RM5
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Merrill Lynch Mortgage Investors Trust 2006-WMC2
* Cl. B-3A, Downgraded to B3 from Baa3
* Cl. B-2A, Downgraded to Ba3 from Baa2
* Cl. B-1A, Downgraded to Baa3 from Baa1
* Cl. B-3B, Downgraded to B3 from Baa3
* Cl. B-2B, Downgraded to Ba3 from Baa2
* Cl. B-1B, Downgraded to Baa3 from Baa1
Issuer: Merrill Lynch Mortgage Investors Trust Series 2006-HE3
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE2
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE3
* Cl. B-2, Downgraded to Ba2 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
* Cl. B-1, Downgraded to Baa3 from Baa1
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE4
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE5
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE6
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE7
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-HE8
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-NC3
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-NC4
* Cl. B-3, Downgraded to B1 from Baa3
* Cl. B-2, Downgraded to Ba1 from Baa2
Issuer: Morgan Stanley ABS Capital I Inc. Trust 2006-WMC2
* Cl. B-3, Downgraded to B3 from Baa3
* Cl. B-1, Downgraded to Ba1 from Baa1
* Cl. B-2, Downgraded to Ba3 from Baa2
Issuer: Morgan Stanley Capital I Inc. Trust 2006-NC2
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Morgan Stanley Home Equity Loan Trust 2006-3
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: Morgan Stanley IXIS Real Estate Capital Trust 2006-1
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: New Century Home Equity Loan Trust 2006-1
* Cl. M-9, Downgraded to B3 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: New Century Home Equity Loan Trust 2006-2
* Cl. M-9, Downgraded to Ba2 from Baa2
* Cl. M-8, Downgraded to Baa3 from Baa1
* Cl. M-10, Downgraded to Caa1 from Baa3
Issuer: Nomura Home Equity Loan Trust 2006-FM1
* Cl. B-2, Downgraded to B3 from Ba2
* Cl. B-1, Downgraded to Ba3 from Ba1
* Cl. M-9, Downgraded to Ba1 from Baa3
Issuer: Nomura Home Equity Loan Trust 2006-FM2
* Cl. B-1, Downgraded to B1 from Ba1
* Cl. B-2, Downgraded to Caa1 from Ba2
* Cl. M-9, Downgraded to Ba2 from Baa3
Issuer: Option One Mortgage Loan Trust 2006-2
* Cl. M-8, Downgraded to Ba1 from Baa2
* Cl. M-9, Downgraded to Ba3 from Baa3
* Cl. M-10, Downgraded to Caa1 from Ba2
Issuer: RAMP Series 2006-NC2 Trust
* Cl. B-1, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: RAMP Series 2006-NC3 Trust
* Cl. M-10, Downgraded to B3 from Ba1
* Cl. M-9, Downgraded to Ba2 from Baa3
* Cl. M-8, Downgraded to Baa3 from Baa2
Issuer: RAMP Series 2006-RS2 Trust
* Cl. M-9, Downgraded to Ba1 from Baa2
Issuer: RASC Series 2006-KS3 Trust
* Cl. M-11, Downgraded to B1 from Ba2
Issuer: RASC Series 2006-KS4 Trust
* Cl. B, Downgraded to B1 from Ba2
Issuer: SG Mortgage Securities Trust 2006-FRE1
* Cl. M-10, Downgraded to B3 from Ba2
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-11, Downgraded to Caa2 from B2
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: SG Mortgage Securities Trust 2006-FRE2
* Cl. M-9, Downgraded to B1 from Baa3
* Cl. M-8, Downgraded to Ba2 from Baa2
* Cl. M-10, Downgraded to Caa1 from Ba1
* Cl. M-11, Downgraded to Caa2 from Ba2
* Cl. M-7, Downgraded to Baa3 from Baa1
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-FR2
* Cl. B-4, Downgraded to B3 from Ba1
* Cl. B-2, Downgraded to Ba2 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
* Cl. B-5, Downgraded to Caa1 from Ba2
* Cl. B-1, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-FR3
* Cl. B-4, Downgraded to B3 from Ba1
* Cl. B-3, Downgraded to B1 from Baa3
* Cl. B-2, Downgraded to Ba2 from Baa2
* Cl. B-5, Downgraded to Caa1 from Ba2
* Cl. B-1, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-FR4
* Cl. B-3, Downgraded to Ba3 from Baa3
* Cl. B-2, Placed on Review for Possible Downgrade, currently
Baa2
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-NC1
* Cl. B-2, Downgraded to B2 from Baa2
* Cl. B-1, Downgraded to Ba2 from Baa1
* Cl. B-3, Downgraded to Caa1 from Baa3
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-NC2
* Cl. B-4, Downgraded to B2 from Ba1
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
* Cl. B-5, Downgraded to Caa1 from Ba2
* Cl. B-1, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-NC3
* Cl. B-4, Downgraded to Ba3 from Baa3
* Cl. B-3, Placed on Review for Possible Downgrade, currently
Baa1
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-WM1
* Cl. B-4, Downgraded to B3 from Ba1
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba3 from Baa3
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-WM2
* Cl. B-4, Downgraded to B1 from Ba1
* Cl. B-2, Downgraded to Ba1 from Baa2
* Cl. B-3, Downgraded to Ba2 from Baa3
Issuer: Securitized Asset Backed Receivables LLC Trust 2006-WM3
* Cl. B-4, Downgraded to B1 from Ba1
* Cl. B-3, Downgraded to Ba1 from Baa3
Issuer: Structured Asset Investment Loan Trust 2006-1
* Cl. M9, Downgraded to B2 from Ba2
* Cl. B1, Downgraded to Caa1 from B1
Issuer: Structured Asset Investment Loan Trust 2006-2
* Cl. B2, Downgraded to Ca from B3
* Cl. M8, Downgraded to B2 from Ba3
* Cl. B1, Downgraded to Caa1 from B1
Issuer: Structured Asset Investment Loan Trust 2006-3
* Cl. B1, Downgraded to B3 from Ba1
* Cl. B2, Downgraded to Caa2 from Ba2
* Cl. M9, Downgraded to Ba3 from Baa3
Issuer: Structured Asset Investment Loan Trust 2006-4
* Cl. B1, Downgraded to B3 from Ba1
* Cl. B2, Downgraded to Ca from Ba2
* Cl. M8, Downgraded to B1 from Baa3
* Cl. M7, Downgraded to Ba2 from Baa2
* Cl. M6, Downgraded to Baa3 from Baa1
Issuer: Structured Asset Investment Loan Trust 2006-BNC1
* Cl. B1, Downgraded to Ca from Caa1
* Cl. M7, Downgraded to Ba3 from Ba1
* Cl. M8, Downgraded to Caa1 from Ba3
* Cl. M6, Placed on Review for Possible Downgrade, currently
Baa3
Issuer: Structured Asset Investment Loan Trust 2006-BNC2
* Cl. M7, Downgraded to B2 from Ba1
* Cl. B1, Downgraded to Caa1 from B2
* Cl. B2, Downgraded to Ca from Caa2
* Cl. M6, Downgraded to B1 from Baa2
* Cl. M8, Downgraded to Caa1 from Ba2
* Cl. M5, Placed on Review for Possible Downgrade, currently
A3
Issuer: Structured Asset Investment Loan Trust 2006-BNC3
* Cl. B2, Downgraded to B3 from Ba2
* Cl. B1, Downgraded to Ba3 from Ba1
* Cl. M8, Downgraded to Ba2 from Baa3
Issuer: Structured Asset Securities Corp Trust 2006-AM1
* Cl. B2, Downgraded to B2 from Ba2
* Cl. B1, Downgraded to Ba3 from Ba1
* Cl. M9, Downgraded to Ba1 from Baa3
Issuer: Structured Asset Securities Corp Trust 2006-NC1
* Cl. B1, Downgraded to B3 from Ba1
* Cl. M9, Downgraded to B2 from Baa3
* Cl. B2, Downgraded to Caa1 from Ba2
* Cl. M8, Downgraded to Ba2 from Baa2
* Cl. M7, Downgraded to Baa3 from Baa1
Issuer: Structured Asset Securities Corp, Mortgage Pass-Through
Certificates, Series 2006-BC3
* Cl. B2, Downgraded to B2 from Ba2
Issuer: Terwin Mortgage Trust 2006-1
* Cl. I-B-5, Downgraded to B1 from Ba2
Issuer: Terwin Mortgage Trust 2006-5
* Cl. I-B-2, Downgraded to Ba3 from Ba2
* S&P Puts Ratings on 612 Subprime Backed Bonds under Neg. Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its credit ratings on
612 classes of residential mortgage-backed securities backed by
U.S. subprime collateral on CreditWatch with negative
implications.
The affected classes total approximately $12.078 billion in rated
securities, which represents 2.13% of the $565.3 billion in U.S.
RMBS rated by Standard & Poor's between the fourth quarter of 2005
and the fourth quarter of 2006.
Changes to S&P's rating methodology as well as details of a
teleconference to be held today are given below.
The CreditWatch actions are being taken at this time because of
poor collateral performance, S&P's expectation of increasing
losses on the underlying collateral pools, the consequent
reduction of credit support, and changes that will be implemented
with respect to the methodology for rating new transactions. Many
of the classes issued in late 2005 and much of 2006 now have
sufficient seasoning to evidence delinquency, default, and loss
trend lines that are indicative of weak future credit performance.
The levels of loss continue to exceed historical precedents and
our initial expectations.
S&P are also conducting a review of CDO ratings where the
underlying portfolio contains any of the affected securities
subject to these rating actions.
Factors Driving New Surveillance Methodology
S&P have been surveilling these transactions on a regular basis
and have been monitoring market trends. At this time, S&P do not
foresee the poor performance abating. Loss rates, which are being
fueled by shifting patterns in loss behavior and further evidence
of lower underwriting standards and misrepresentations in the
mortgage market, remain in excess of historical precedents and
S&P's initial assumptions.
Loss Patterns
New data reveals that delinquencies and foreclosures continue to
accumulate at an increasing rate for the 2006 vintage. S&P see
poor performance of loans, early payment defaults, and increasing
levels of delinquencies and losses.
Total aggregate losses on all subprime transactions issued since
the fourth quarter of 2005 is 29 basis points, as compared with 7
basis points for similar transactions issued in 2000.
Transactions from the 2000 vintage are used as a comparison
because they were, up until now, the worst performing vintage of
this decade. When recent transactions with the same seasoning are
compared on a quarterly basis with similar transactions issued in
2000, S&P find that both mean losses and standard deviations are
running in excess of the 2000 book for the fourth quarter of 2005
through the fourth quarter of 2006.
Seriously delinquent loans (90-days-plus, foreclosure, and real
estate owned), on average, also exceed the 2000 book of business
for each quarterly comparison except for the fourth quarter of
2005.
Economic Factors
On a macroeconomic level, we expect that the U.S. housing market,
especially the subprime sector, will continue to decline before it
improves, and home prices will continue to come under stress.
Weakness in the property markets continues to exacerbate losses,
with little prospect for improvement in the near term.
Furthermore, S&P expect losses will continue to increase, as
borrowers experience rising loan payments due to the resetting
terms of their adjustable-rate loans and principal amortization
that occurs after the interest-only period ends for both
adjustable-rate and fixed-rate loans.
Although property values have decreased slightly, additional
declines are expected. David Wyss, Standard & Poor's chief
economist, projects that property values will decline 8% on
average between 2006 and 2008, and will bottom out in the first
quarter of 2008.
While S&P's LEVELS model assumes property value declines of 22%
for the 'BBB' and lower rating category stress environments, the
continued decline in prices will apply additional stress to these
transactions by increasing losses on the sale of foreclosed
properties, as well as removing or reducing the borrowers' ability
to refinance or sell their homes to meet debt obligations.
As lenders have tightened underwriting guidelines, fewer refinance
options may be available to these borrowers, especially if their
loan-to-value and combined LTV ratios have risen in the wake of
declining home prices.
Data Quality
The Mortgage Asset Research Institute reports that alleged
misrepresentations on credit reports were up significantly as a
percentage of total submissions received in 2006. MARI, which was
recently commissioned by the Mortgage Bankers Assoc. to conduct a
mortgage fraud study, reported that the current findings of fraud
were in excess of previous industry highs. Data quality
concerning some of the borrower and loan characteristics provided
during the rating process has also come under question.
Therefore, key risk variables that have historically influenced
default patterns, such as FICO, LTV, and ownership status, are
proving less predictive.
It is expected that the ongoing weakness in both national and
regional property markets will exacerbate losses with little
prospect for improvement in the near term. Also, many of these
transactions will likely encounter additional credit stress from
upcoming interest rate and payment resets.
Data quality is fundamental to S&P's rating analysis. The loan
performance associated with the data to date has been anomalous in
a way that calls into question the accuracy of some of the initial
data provided to us regarding the loan and borrower
characteristics. A discriminate analysis was performed to
identify the characteristics associated with the group of
transactions performing within initial expectations and those
performing below initial expectations. The following
characteristics associated with each group were analyzed: LTV,
CLTV, FICO, debt-to-income, weighted-average coupon, margin,
payment cap, rate adjustment frequency, periodic rate cap on first
adjustment, periodic rate cap subsequent to first adjustment,
lifetime max rate, term, and issuer. S&P's results show no
statistically significant differentiation between the two groups
of transactions on any of the above characteristics. Reports of
alleged underwriting fraud tend to grow over time, as suspected
fraud incidents are detected upon investigation following a loan
default.
Payment Adjustments
Adjustable-rate and interest-only loans subject to contractual
increases in their monthly payments will continue to put pressure
on borrowers' ability to meet monthly payments in the future. The
transactions with classes identified for CreditWatch placement
contain, on average, 75%-80% of the types of loans that are
subject to some type of payment adjustment over the next 18
months.
When reviewing the transactions initially, S&P assumed that
borrowers would experience additional stresses when subject to
payment adjustments. All loans containing some type of payment
increase were assumed to default 20% more often than similar
borrowers with fixed-rate loans and FICO scores of less than 660.
S&P's analysis intended to anticipate the burden and resulting
payment shock that a borrower would face assuming rising interest
rates.
The following table provides the aggregate percentage of 2/1 arms
for U.S. subprime transactions by quarter for the period under
review. Since there tends to be a lag between origination and
securitization, many of the 2/1 hybrid ARM loans will reset
approximately seven quarters after the transaction closes.
2/1 ARM Reset Information By Quarter
Sold during Orig. subprime % of Reset quarter
balance 2/1 ARM
----------- -------------- ------ ------------
2005-Q4 $138,888,212,337 64 2007-Q3
2006-Q1 $108,014,850,161 70 2007-Q4
2006-Q2 $121,149,551,887 70 2008-Q1
2006-Q3 $98,332,355,370 62 2008-Q2
2006-Q4 $98,965,073,697 60 2008-Q3
Given all of these current factors, S&P are refining its
surveillance approach for subprime RMBS transactions issued from
the fourth quarter of 2005 through the fourth quarter of 2006.
Going forward, the ratings methodology for new transactions will
also incorporate these factors.
Surveillance Methodology Changes
As performance continues to deteriorate, S&P have increased the
severity of the surveillance assumptions S&P use to evaluate the
ongoing creditworthiness for this group of transactions. The
level of severity was increased to 40% from 33% to reflect the
average severity that subprime servicers are currently
experiencing, which was determined through data collected in S&P's
SEAM database. S&P will continue to apply this revised severity
assumption to delinquencies as they move through the pipeline.
Specifically, for subprime collateral, S&P assume that the REO
loans are liquidated evenly within six months. During the same
six-month period, 25% of foreclosures and 10% of loans that are
90-plus-days delinquent would be evenly liquidated. During months
seven through 12, the remaining 75% of foreclosures and 30% of the
loans that are 90-plus-days delinquent will be evenly liquidated.
In order to account for the movement of the remaining 90-plus-days
delinquent and future delinquent loans through the delinquency
pipeline, S&P assume that its projection of the losses used in
month 12 continues and amortizes down in months 13 through 36,
which allows for loans presently 60- or 30-days delinquent, or
current, to enter into the delinquency pipeline in the future.
Beginning in the next few days, S&P expect that the majority of
the ratings on the classes that have been placed on CreditWatch
negative will be downgraded. S&P will lower its rating:
-- To 'CCC' on any class that does not pass S&P's stress test
scenario within 12 months, regardless of its current
rating;
-- To 'B' on any class that does not pass S&P's stress test
scenario within 13 to 24 months;
-- To 'BB' on any class that does not pass S&P's stress test
scenario within 25 to 30 months; and
-- To 'BBB' on any class that does not pass S&P's stress test
scenario within 31 to 36 months.
In addition, S&P have modified its approach to reviewing the
ratings on senior classes in a transaction in which subordinate
classes have been downgraded. Historically, S&P's practice has
been to maintain a rating on any class that has passed S&P's
stress assumptions and has had at least the same level of
outstanding credit enhancement as it had at issuance. Going
forward, there will be a higher degree of correlation between the
rating actions on classes located sequentially in the capital
structure. A class will have to demonstrate a higher level of
relative protection to maintain its rating when the class
immediately subordinate to it is being downgraded.
Transactions issued in 2007 have not had adequate seasoning to
establish a payment history that would make the outcomes of the
delinquency and loss tests detailed above capable of meaningful
measurement under our new methodology. However, the same asset
risks that are apparent in the transactions issued in 2006 may
also be present in the 2007 transactions, as well as in
transactions currently being packaged for sale and securitization.
Hence, to ensure a consistent application of surveillance
methodology we will continue to monitor the 2007 vintage
securitizations and apply the same surveillance methodology as
described above to the 2007 transactions as they season and as
delinquency and loss data become available. S&P will also review
these transactions under the revised surveillance methodology, as
well as the revised methodology employed for issuing new ratings
and may take rating actions, as deemed appropriate, throughout the
remainder of 2007.
S&P will also continue its review of second mortgages, including
"piggyback seconds," "silent seconds," and closed-end second
liens, and expect to publish the results in the near future.
S&P are considering a number of changes to its initial rating
methodology, as further described below, so as to better mitigate
these concerns going forward.
Revised Rating Methodology For New Issues
For transactions that close on or after July 10, 2007, S&P will
incorporate several changes to its ratings methodology that will
result in greater levels of credit protection for rated
transactions. S&P's cash flow methodology assumptions will
include a simultaneous combination of faster voluntary and
involuntary prepayments that will result in less credit to excess
spread.
Furthermore, S&P's default expectation for 2/28 hybrid ARM loans
will increase by approximately 21%. S&P are in the process of
updating its LEVELS and SPIRE models. A separate article will be
released in the next few days describing the revisions to S&P's
ratings methodology, and will provide the estimated timing for
release of the updated models.
Underwriting Review
Given the level of loosened underwriting at the time of loan
origination, misrepresentation, and speculative borrower behavior
reported for the 2006 vintage, S&P will be increasing its review
of the capabilities of lenders to minimize the potential and
incidence of misrepresentation in their loan production. A
lender's fraud-detection capabilities will be a key area of focus
for us.
The review will consist of a detailed examination of: (a) the
overall capabilities and experience of the executive and
operational management team; (b) the production channels and
broker approval process; (c) underwriting guidelines and the
credit process; (d) quality control and internal audits; (e) the
use of third-party due diligence firms, if applicable; and
(f) secondary marketing. A new addition to this review process
will be a fraud-management questionnaire focusing on an
originator's tools, processes, and systems for control with
respect to mitigating the potential for misrepresentation.
Subprime Ratings Placed On Creditwatch Negative
Aames Mortgage Investment Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M10 BBB/Watch Neg BBB
2006-1 M11 BBB-/Watch Neg BBB-
ABFC Trust
Rating
------
Series Class To From
------ ----- -- -----
2005-WMC1 B1 BB+/Watch Neg BB+
2005-WMC1 B2 BB/Watch Neg BB
ACE Securities Corp. Home Equity Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-HE6 M9 BBB+/Watch Neg BBB+
2005-HE6 M10 BBB/Watch Neg BBB
2005-HE6 M11 BBB-/Watch Neg BBB-
2005-HE6 B1 BB+/Watch Neg BB+
2006-ASAP3 M8, M9, M10 BBB/Watch Neg BBB
2006-ASAP3 M11 BBB/Watch Neg BBB
2006-ASAP4 M11 BBB/Watch Neg BBB
2006-FM1 M7 BBB+/Watch Neg BBB+
2006-FM1 M8 BBB/Watch Neg BBB
2006-FM1 M9 BBB-/Watch Neg BBB-
2006-FM1 M10 BB+/Watch Neg BB+
2006-FM2 M7 BBB+/Watch Neg BBB+
2006-FM2 M8 BBB/Watch Neg BBB
2006-FM2 M9 BBB-/Watch Neg BBB-
2006-FM2 M10 BB+/Watch Neg BB+
2006-HE1 M8 A-/Watch Neg A-
2006-HE1 M9 BBB+/Watch Neg BBB+
2006-HE1 M10 BBB/Watch Neg BBB
2006-HE2 M9 BBB/Watch Neg BBB-
2006-HE2 M10 BBB-/Watch Neg BBB-
2006-HE2 M11 BB+/Watch Neg BB+
2006-HE3 M7 A+/Watch Neg A+
2006-HE3 M8 A/Watch Neg A
2006-HE3 M9 BBB+/Watch Neg BBB+
2006-HE3 M10 BBB/Watch Neg BBB
2006-HE3 M11 BBB-/Watch Neg BBB-
2006-HE4 M8 BBB+/Watch Neg BBB+
2006-HE4 M9 BBB/Watch Neg BBB
2006-HE4 M10 BBB-/Watch Neg BBB-
2006-HE4 M11 BB+/Watch Neg BB+
2006-NC2 M9 BBB-/Watch Neg BBB-
2006-NC2 M10 BB+/Watch Neg BB+
2006-NC2 M11 BB/Watch Neg BB
Aegis Asset Backed Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-5 M6, B1 A+/Watch Neg A+
2005-5 B2 A/Watch Neg A
2005-5 B3 BBB+/Watch Neg BBB+
2005-5 B4 BBB/Watch Neg BBB
2005-5 B6 BB+/Watch Neg BB+
American Home Mortgage Investment Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-3 B BBB/Watch Neg BBB
2006-2 II-M-4 A+/Watch Neg A+
2006-2 III-M-1 AA/Watch Neg AA
2006-2 III-M-2 A+/Watch Neg A+
2006-2 III-M-3 A+/Watch Neg A+
2006-2 III-M-4 A-/Watch Neg A-
2006-2 III-M-5 BBB+/Watch Neg BBB+
2006-2 IV-M-1 AA/Watch Neg AA
2006-2 IV-M-2 A/Watch Neg A
2006-2 IV-M-3 BBB+/Watch Neg BBB+
2006-2 IV-M-4 BBB/Watch Neg BBB
2006-2 IV-M-5 BBB/Watch Neg BBB
Argent Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-W2 M-10 BBB/Watch Neg BBB
2005-W2 M-11 BBB/Watch Neg BBB
2005-W2 M-12 BBB-/Watch Neg BBB-
2005-W2 M-13 BB+/Watch Neg BB+
2005-W3 M-10 BBB+/Watch Neg BBB+
2005-W3 M-11 BBB/Watch Neg BBB
2005-W3 M-12 BBB-/Watch Neg BBB-
2005-W4 M-8 BBB/Watch Neg BBB
2006-4 M-5 A+/Watch Neg A+
2006-4 M-6 A/Watch Neg A
2006-4 M-7 A-/Watch Neg A-
2006-4 M-8 BBB+/Watch Neg BBB+
2006-4 M-9 BBB/Watch Neg BBB
2006-M1 M-7 A/Watch Neg A
2006-M1 M-8 A-/Watch Neg A-
2006-M1 M-9 BBB+/Watch Neg BBB+
2006-M1 M-10 BBB/Watch Neg BBB
2006-M2 M-6 A-/Watch Neg A-
2006-M2 M-7 BBB+/Watch Neg BBB+
2006-M2 M-8 BBB/Watch Neg BBB
2006-M2 M-9 BBB-/Watch Neg BBB-
2006-M2 M-10 BB+/Watch Neg BB+
2006-W1 M-9 BBB+/Watch Neg BBB+
2006-W1 M-10 BBB-/Watch Neg BBB-
2006-W2 M-8 BBB/Watch Neg BBB
2006-W2 M-9 BBB-/Watch Neg BBB-
2006-W2 M-10 BB+/Watch Neg BB+
2006-W3 M-6 A/Watch Neg A
2006-W3 M-7 A-/Watch Neg A-
2006-W3 M-8 BBB+/Watch Neg BBB+
2006-W3 M-9 BBB-/Watch Neg BBB-
2006-W3 M-10 BBB-/Watch Neg BBB-
2006-W5 M-5 AA-/Watch Neg AA-
2006-W5 M-6 A+/Watch Neg A+
2006-W5 M-7 A/Watch Neg A
2006-W5 M-8 A-/Watch Neg A-
2006-W5 M-9 BBB+/Watch Neg BBB+
Asset Backed Securities Corporation Home Equity Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
NC2005-HE8 M10 BB+/Watch Neg BB+
NC2005-HE8 M11 BB/Watch Neg BB
2006-HE1 M12 BB+/Watch Neg BB+
NC2006-HE2 M9 BBB-/Watch Neg BBB-
NC2006-HE2 M10 BB+/Watch Neg BB+
NC2006-HE2 M11 BB/Watch Neg BB
NC2006-HE4 M6 BBB+/Watch Neg BBB+
NC2006-HE4 M7 BBB/Watch Neg BBB
NC2006-HE4 M8 BBB-/Watch Neg BBB-
NC2006-HE4 M9 BB+/Watch Neg BB+
Bear Sterns Asset Backed Securities I Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-CL1 M-6 A-/Watch Neg A-
2005-CL1 M-7 BBB+/Watch Neg BBB+
2005-CL1 M-8 BBB/Watch Neg BBB
2005-CL1 M-9 BBB-/Watch Neg BBB-
2005-CL1 M-10 BB/Watch Neg BB
2006-EC2 M-10 BB+/Watch Neg BB+
2006-HE3 M9 BBB-/Watch Neg BBB-
2006-HE3 M10 BB+/Watch Neg BB+
2006-HE4 M8 BBB/Watch Neg BBB
2006-HE4 M9 BBB-/Watch Neg BBB-
2006-HE4 M10 BB+/Watch Neg BB+
2006-HE5 M9 BBB-/Watch Neg BBB-
2006-HE5 M10 BB+/Watch Neg BB+
2006-HE5 M11 BB/Watch Neg BB
2006-HE6 I-M10 BB+/Watch Neg BB+
2006-HE6 I-M11 BB/Watch Neg BB
2006-HE6 II-M7 BBB+/Watch Neg BBB+
2006-HE6 II-M8 BBB/Watch Neg BBB
2006-HE6 II-M9 BBB-/Watch Neg BBB-
2006-HE6 II-M10 BB+/Watch Neg BB+
2006-HE6 II-M11 BB/Watch Neg BB
2006-HE7 II-M10 BB+/Watch Neg BB+
2006-HE7 II-M11 BB/Watch Neg BB
Bravo Mortgage Asset Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M9 BBB-/Watch Neg BBB-
2006-1 M10 BB+/Watch Neg BB+
2006-1 M11 BB/Watch Neg BB
Carrington Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-FRE1 M10 BBB/Watch Neg BBB
2005-FRE1 M11 BBB-/Watch Neg BBB-
2005-FRE1 M12 BB+/Watch Neg BB+
2005-FRE1 M13 BB/Watch Neg BB
2006-NC2 M9 BBB-/Watch Neg BBB-
2006-NC2 M10 BB+/Watch Neg BB+
Citigroup Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-HE3 M11 BB+/Watch Neg BB+
2005-HE3 M12 BB/Watch Neg BB
2005-HE3 M13 BB/Watch Neg BB
2005-HE4 M8 BBB+/Watch Neg BBB+
2005-HE4 M9 BBB/Watch Neg BBB
2005-HE4 M10 BBB-/Watch Neg BBB-
2005-HE4 M11 BB+/Watch Neg BB+
2005-HE4 M12 BB/Watch Neg BB
2005-OPT4 M12 BB+/Watch Neg BB+
2005-OPT4 M13 BB/Watch Neg BB
2006-AR6 2-M3 A/Watch Neg A
2006-AR6 2-M4 BBB/Watch Neg BBB
2006-CB3 M6 A-/Watch Neg A-
2006-CB3 B1 BBB+/Watch Neg BBB+
2006-CB3 B2 BBB/Watch Neg BBB
2006-CB3 B3 BBB-/Watch Neg BBB-
2006-HE1 M10 BB+/Watch Neg BB+
2006-HE1 M11 BB/Watch Neg BB
2006-HE2 M7 BBB+/Watch Neg BBB+
2006-HE2 M8 BBB/Watch Neg BBB
2006-HE2 M9 BBB-/Watch Neg BBB-
2006-HE2 M10 BB+/Watch Neg BB+
2006-NC1 M8 BBB/Watch Neg BBB
2006-NC1 M9 BBB-/Watch Neg BBB-
2006-NC1 M10 BB+/Watch Neg BB+
2006-NC1 M11 BB/Watch Neg BB
2006-NC2 M9 BBB-/Watch Neg BBB-
2006-NC2 M10 BB+/Watch Neg BB+
2006-NC2 M11 BB/Watch Neg BB
2006-WF1 M-3 BBB/Watch Neg BBB
2006-WF1 M-4 BBB-/Watch Neg BBB-
2006-WF1 M-5 BB+/Watch Neg BB+
2006-WF2 M-2 A/Watch Neg A
2006-WF2 M-3 BBB/Watch Neg BBB
2006-WF2 M-4 BBB-/Watch Neg BBB-
2006-WF2 M-5 BB+/Watch Neg BB+
2006-WMC1 M9 BBB-/Watch Neg BBB-
2006-WMC1 M10 BB+/Watch Neg BB+
2006-WMC1 M11 BB/Watch Neg BB
CWABS Asset-Backed Certificates Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-9 M-5 A/Watch Neg A
2005-9 M-6 A-/Watch Neg A-
2005-9 M-7 BBB+/Watch Neg BBB+
2005-IM2 M6 A-/Watch Neg A-
2005-IM2 M7 BBB+/Watch Neg BBB+
2006-5 M8 BBB/Watch Neg BBB
2006-5 B BBB-/Watch Neg BBB-
2006-6 M7 BBB/Watch Neg BBB
2006-6 M8 BBB-/Watch Neg BBB-
2006-6 B BB+/Watch Neg BB+
2006-7 M8 BBB/Watch Neg BBB
2006-7 M9 BBB-/Watch Neg BBB-
2006-7 B BB+/Watch Neg BB+
2006-8 B BB+/Watch Neg BB+
2006-10 MV-9 BBB-/Watch Neg BBB-
2006-10 BV BB+/Watch Neg BB+
Encore Credit Receivables Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-4 M-11 BB+/Watch Neg BB+
2005-4 M-12 BB-/Watch Neg BB-
FBR Securitization Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-3 M-7 BBB+/Watch Neg BBB+
2005-3 M-8 BBB/Watch Neg BBB
2005-3 M-9 BBB-/Watch Neg BBB-
2005-4 M-12 BBB-/Watch Neg BBB-
2005-5 M-12 BBB-/Watch Neg BBB-
Fieldstone Mortgage Investment Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M8 A-/Watch Neg A-
2006-1 M9, M10 BBB/Watch Neg BBB
First Franklin Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-FF2 M8, M9 BBB-/Watch Neg BBB-
2006-FF2 B BB+/Watch Neg BB+
2006-FF5 M-9, M-10 BBB-/Watch Neg BBB-
2006-FF5 M-11 BB/Watch Neg BB
2006-FF7 M-8 BBB/Watch Neg BBB
2006-FF7 M-9 BBB-/Watch Neg BBB-
2006-FF7 M-10 BB+/Watch Neg BB+
2006-FF8 M-9 BBB/Watch Neg BBB
2006-FF8 M-10 BBB-/Watch Neg BBB-
2006-FF8 M-11, M-12 BB+/Watch Neg BB+
2006-FF9 M-10 BBB-/Watch Neg BBB-
2006-FF10 M-9 BBB-/Watch Neg BBB-
2006-FF10 B-1 BB+/Watch Neg BB+
2006-FF10 B-2 BB/Watch Neg BB
Fremont Home Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-D B1 BBB+/Watch Neg BBB+
2005-D B2 BBB/Watch Neg BBB
2005-D B3 BBB-/Watch Neg BBB-
2005-D B4 BB+/Watch Neg BB+
2005-E B1 BBB/Watch Neg BBB
2006-1 M7 BBB+/Watch Neg BBB+
2006-1 M8 BBB/Watch Neg BBB
2006-1 M9 BBB-/Watch Neg BBB-
2006-1 B1, B2 BB+/Watch Neg BB+
2006-2 B1, B2 BB+/Watch Neg BB+
2006-A M7 BBB/Watch Neg BBB
2006-A M8, M9 BBB-/Watch Neg BBB-
2006-B M6 A-/Watch Neg A-
2006-B M7 BBB+/Watch Neg BBB+
2006-B M8, M9 BBB/Watch Neg BBB
2006-B M10 BBB-/Watch Neg BBB-
2006-C M9 BBB-/Watch Neg BBB-
2006-C M10 BB+/Watch Neg BB+
2006-C M11 BB/Watch Neg BB
GE-WMC Mortgage Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M6 A/Watch Neg A
2006-1 B1 A-/Watch Neg A-
2006-1 B2 BBB+/Watch Neg BBB+
2006-1 B3 BBB/Watch Neg BBB
2006-2 B4 BBB-/Watch Neg BBB-
2006-2 B5 BBB-/Watch Neg BBB-
GSAA Home Equity Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-5 B-2 BBB-/Watch Neg BBB-
2006-5 B-3 BB/Watch Neg BB
GSAMP Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-AHL2 B-2 BBB-/Watch Neg BBB-
2005-AHL2 B-3 BBB-/Watch Neg BBB-
2005-AHL2 B-4 BB+/Watch Neg BB+
2006-FM1 M7 A-/Watch Neg A-
2006-FM1 B1 BBB+/Watch Neg BBB+
2006-FM1 B2, B3 BBB-/Watch Neg BBB-
2006-FM2 B2 BB+/Watch Neg BB+
2006-NC2 M8 BBB/Watch Neg BBB
2006-NC2 M9,B-1 BBB-/Watch Neg BBB-
2006-NC2 B-2 BB+/Watch Neg BB+
Home Equity Asset Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-7 B3 BBB-/Watch Neg BBB-
2005-7 B4, B5 BB+/Watch Neg BB+
2005-8 B3, B4 BBB-/Watch Neg BBB-
2005-8 B5 BB+/Watch Neg BB+
2006-2 B3 BBB-/Watch Neg BBB-
2006-2 B4 BB+/Watch Neg BB+
2006-2 B5 BB/Watch Neg BB
2006-5 B2 BBB/Watch Neg BBB
2006-5 B3 BBB-/Watch Neg BBB-
2006-6 B2 BBB/Watch Neg BBB
2006-6 B3 BBB-/Watch Neg BBB-
2006-6 B4 BB+/Watch Neg BB+
2006-7 B3 BB+/Watch Neg BB+
Home Equity Mortgage Loan Asset-Backed Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-C M10 BBB/Watch Neg BBB
2005-C M11 BBB-/Watch Neg BBB-
2005-D M9 BBB/Watch Neg BBB
2006-A M9 BBB+/Watch Neg BBB+
2006-A M10 BBB-/Watch Neg BBB-
2006-B M7, M8 BBB+/Watch Neg BBB+
2006-B M9 BBB/Watch Neg BBB
2006-C M-7 BBB+/Watch Neg BBB+
2006-C M-8 BBB/Watch Neg BBB
2006-C M-9 BBB-/Watch Neg BBB-
HSI Asset Securitization Corp. Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-I1 M6 A-/Watch Neg A-
2006-OPT4 M10 BB/Watch Neg BB
2006-WMC1 M6 A/Watch Neg A
2006-WMC1 M7 BBB+/Watch Neg BBB+
2006-WMC1 M8 BBB/Watch Neg BBB
2006-WMC1 M9 BBB-/Watch Neg BBB-
IndyMac INDB Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 B1 A/Watch Neg A
2006-1 B2 A-/Watch Neg A-
2006-1 B3 BBB+/Watch Neg BBB+
2006-1 B4 BBB/Watch Neg BBB
IXIS Real Estate Capital Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-HE1 B2 BBB+/Watch Neg BBB+
2006-HE1 B3 BBB/Watch Neg BBB
2006-HE1 B4 BBB-/Watch Neg BBB-
2006-HE2 B1 A-/Watch Neg A-
2006-HE2 B2 BBB+/Watch Neg BBB+
2006-HE2 B3 BBB/Watch Neg BBB
2006-HE2 B4 BBB-/Watch Neg BBB-
2006-HE3 B3, B4 BBB-/Watch Neg BBB-
2006-HE3 B5 BB+/Watch Neg BB+
J.P. Morgan Mortgage Acquisition Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-ACC1 M11 BB/Watch Neg BB
2006-FRE1 M10 BB+/Watch Neg BB+
2006-FRE1 M11 BB/Watch Neg BB
2006-FRE2 M10 BB+/Watch Neg BB+
2006-FRE2 M11 BB/Watch Neg BB
2006-HE1 M11 BB/Watch Neg BB
2006-NC1 M10 BB+/Watch Neg BB+
2006-NC1 M11 BB/Watch Neg BB
2006-RM1 M9 BBB-/Watch Neg BBB-
2006-RM1 M10 BB+/Watch Neg BB+
2006-WM1 M7 BBB/Watch Neg BBB
2006-WM1 M8 BBB-/Watch Neg BBB-
2006-WM1 M9 BB+/Watch Neg BB+
Lehman XS Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-7 M6 A-/Watch Neg A-
2006-7 M7 BBB+/Watch Neg BBB+
2006-7 M-8 BBB/Watch Neg BBB
2006-7 M9 BBB-/Watch Neg BBB-
Long Beach Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-3 M8 BBB/Watch Neg BBB
2005-WL3 B2 BB+/Watch Neg BB+
2006-1 M7 A/Watch Neg A
2006-1 M8 A-/Watch Neg A-
2006-1 M9 BBB+/Watch Neg BBB+
2006-1 M10 BBB/Watch Neg BBB
2006-1 M11 BBB-/Watch Neg BBB-
2006-2 M6 A/Watch Neg A
2006-2 M7 A-/Watch Neg A-
2006-2 M8 BBB+/Watch Neg BBB+
2006-2 M9 BBB/Watch Neg BBB
2006-2 M10 BBB-/Watch Neg BBB-
2006-2 B BB/Watch Neg BB
2006-3 M6 A+/Watch Neg A+
2006-3 M7 A/Watch Neg A
2006-3 M8 A-/Watch Neg A-
2006-3 M9 BBB+/Watch Neg BBB+
2006-3 M10 BBB/Watch Neg BBB
2006-3 B BBB-/Watch Neg BBB-
2006-4 M7 A/Watch Neg A
2006-4 M8 A-/Watch Neg A-
2006-4 M9 BBB+/Watch Neg BBB+
2006-4 M10 BBB+/Watch Neg BBB+
2006-4 M11 BBB-/Watch Neg BBB-
2006-4 B BB+/Watch Neg BB+
2006-5 M8, M9 BBB+/Watch Neg BBB+
2006-5 M10 BBB/Watch Neg BBB
2006-5 M11 BBB-/Watch Neg BBB-
2006-5 B BB+/Watch Neg BB+
2006-6 M9 BBB+/Watch Neg BBB+
2006-6 M10 BBB/Watch Neg BBB
2006-6 M11 BBB-/Watch Neg BBB-
2006-7 M9 BBB+/Watch Neg BBB+
2006-7 M10 BBB/Watch Neg BBB
2006-7 M11 BBB-/Watch Neg BBB-
2006-WL2 M9 BBB-/Watch Neg BBB-
2006-WL2 B1 BB+/Watch Neg BB+
2006-WL2 B2 BB/Watch Neg BB
2006-WL2 B3 BB-/Watch Neg BB-
2006-WL3 M8 BBB/Watch Neg BBB
2006-WL3 M9 BBB-/Watch Neg BBB-
Luminent Mortgage Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-1 B4 BBB/Watch Neg BBB
2005-1 B5 BBB-/Watch Neg BBB-
2005-1 B6 BB/Watch Neg BB
MASTR Asset Backed Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-FRE1 M8 BBB/Watch Neg BBB
2005-FRE1 M9 BBB-/Watch Neg BBB-
2005-FRE1 M10 BB+/Watch Neg BB+
2005-HE2 M10 BBB-/Watch Neg BBB-
2005-HE2 M11 BB+/Watch Neg BB+
2005-NC2 M9 A/Watch Neg A
2005-NC2 M10 A-/Watch Neg A-
2005-NC2 M11, M12 BBB+/Watch Neg BBB+
2006-AM1 M12 BBB/Watch Neg BBB
2006-AM2 M10 BBB+/Watch Neg BBB+
2006-AM2 M11 BBB/Watch Neg BBB
2006-FRE1 M6 A-/Watch Neg A-
2006-FRE2 M6 A-/Watch Neg A-
2006-FRE2 M7 BBB+/Watch Neg BBB+
2006-FRE2 M8 BBB/Watch Neg BBB
2006-HE1 M-9 A/Watch Neg A
2006-HE1 M-10 A-/Watch Neg A-
2006-HE1 M-11 BBB/Watch Neg BBB
2006-HE2 M6 A/Watch Neg A
2006-HE2 M7 BBB+/Watch Neg BBB+
2006-HE2 M8 BBB/Watch Neg BBB
2006-HE2 M9 BBB-/Watch Neg BBB-
2006-HE2 M10 BB+/Watch Neg BB+
2006-HE3 M10 BB+/Watch Neg BB+
2006-HE3 M11 BB/Watch Neg BB
2006-NC2 M10 BB+/Watch Neg BB+
2006-NC2 M11 BB/Watch Neg BB
2006-WMC2 M6 A/Watch Neg A
2006-WMC2 M7 BBB+/Watch Neg BBB+
2006-WMC2 M8 BBB/Watch Neg BBB
2006-WMC3 M10 BB+/Watch Neg BB+
Merrill Lynch Mortgage Investors Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-HE2 M5 A/Watch Neg A
2005-HE2 M6 A-/Watch Neg A-
2005-HE2 B1 BBB+/Watch Neg BBB+
2005-HE2 B2 BBB/Watch Neg BBB
2006-AHL1 B2 BBB/Watch Neg BBB
2006-AHL1 B3 BBB-/Watch Neg BBB-
2006-AR1 B1 BBB+/Watch Neg BBB+
2006-AR1 B2 BBB+/Watch Neg BBB+
2006-AR1 B3 BBB/Watch Neg BBB
2006-FM1 B1 BBB+/Watch Neg BBB+
2006-FM1 B2 BBB/Watch Neg BBB
2006-FM1 B3 BBB-/Watch Neg BBB-
2006-MLN1 B4 BB+/Watch Neg BB+
2006-RM2 B1 A-/Watch Neg A-
2006-RM2 B2 BBB+/Watch Neg BBB+
2006-RM2 B3 BBB/Watch Neg BBB
2006-RM2 B4 BBB-/Watch Neg BBB-
2006-RM4 B3 BBB-/Watch Neg BBB-
2006-RM4 B4 BB+/Watch Neg BB+
Morgan Stanley Capital I Inc. Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-NC2 B3 BBB-/Watch Neg BBB-
2006-HE2 B3 BBB/Watch Neg BBB
Morgan Stanley ABS Capital I Inc. Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-NC3 B2 BBB/Watch Neg BBB
2006-NC3 B3 BBB-/Watch Neg BBB-
2006-NC4 B2 BBB/Watch Neg BBB
2006-NC4 B3 BBB-/Watch Neg BBB-
2006-HE3 B2 BBB/Watch Neg BBB
2006-HE3 B3 BBB-/Watch Neg BBB-
2006-HE4 B3 BBB-/Watch Neg BBB-
2006-HE6 B2 BBB/Watch Neg BBB
2006-HE6 B3 BBB-/Watch Neg BBB-
2006-WMC2 B3 BBB-/Watch Neg BBB-
Morgan Stanley Home Equity Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-3 B3 BBB-/Watch Neg BBB-
Morgan Stanley IXIS Real Estate Capital Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 B2 BBB/Watch Neg BBB
2006-1 B3 BBB-/Watch Neg BBB-
New Century Home Equity Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M7 BBB+/Watch Neg BBB+
2006-1 M8 BBB/Watch Neg BBB
2006-1 M9 BBB-/Watch Neg BBB-
2006-2 M8 BBB/Watch Neg BBB
2006-2 M9 BBB-/Watch Neg BBB-
Nomura Home Equity Loan Inc.
Rating
------
Series Class To From
------ ----- -- ----
2005-HE1 B-2 BB/Watch Neg BB
2006-FM1 M-8 BBB+/Watch Neg BBB+
2006-FM1 M-9 BBB/Watch Neg BBB
2006-FM1 B-1 BBB-/Watch Neg BBB-
2006-FM1 B-2 BB+/Watch Neg BB+
2006-FM2 M-9 BBB/Watch Neg BBB
2006-FM2 B-1 BBB-/Watch Neg BBB-
2006-FM2 B-2 BB+/Watch Neg BB+
2006-HE1 B-2 BB/Watch Neg BB
2006-HE2 M-9 BBB/Watch Neg BBB
2006-HE2 B-1 BBB-/Watch Neg BBB-
2006-HE2 B-2 BB+/Watch Neg BB+
NovaStar Mortgage Funding Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-1 M-7 A-/Watch Neg A-
2006-1 M-8 BBB+/Watch Neg BBB+
2006-1 M-9 BBB/Watch Neg BBB
2006-1 M-10 BBB-/Watch Neg BBB-
2006-1 M-11 BB+/Watch Neg BB+
2006-2 M-7 A/Watch Neg A
2006-2 M-8 BBB+/Watch Neg BBB+
2006-2 M-9 BBB/Watch Neg BBB
2006-2 M-10 BB+/Watch Neg BB+
2006-3 M-6 A+/Watch Neg A+
2006-3 M-7 A/Watch Neg A
2006-3 M-8 BBB+/Watch Neg BBB+
2006-3 M-9 BBB/Watch Neg BBB
2006-3 M-10 BBB-/Watch Neg BBB-
2006-4 M-7 A/Watch Neg A
2006-4 M-8 A-/Watch Neg A-
2006-4 M-9 BBB+/Watch Neg BBB+
2006-4 M-10 BBB/Watch Neg BBB
2006-4 M-11 BBB-/Watch Neg BBB-
2006-5 M-7 A-/Watch Neg A-
2006-5 M-8 BBB+/Watch Neg BBB+
2006-5 M-9 BBB/Watch Neg BBB
2006-5 M-10 BBB-/Watch Neg BBB-
2006-5 M-11 BB+/Watch Neg BB+
2006-6 M-12 BB+/Watch Neg BB+
2006-6 M-13 BB/Watch Neg BB
Option One Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-2 M6 A-/Watch Neg A-
2006-2 M7 BBB+/Watch Neg BBB+
2006-2 M8 BBB/Watch Neg BBB
2006-2 M9 BBB-/Watch Neg BBB-
2006-2 M10 BB/Watch Neg BB
Ownit Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-5 M-6 A-/Watch Neg A-
2005-5 B-1 BBB+/Watch Neg BBB+
2005-5 B-2 BBB/Watch Neg BBB
Popular ABS Mortgage Pass-Through Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-5 BF-3 BB-/Watch Neg BB-
2005-5 BV-4 BB/Watch Neg BB
RAMP Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-NC1 M-6 A/Watch Neg A
2006-NC1 M-7 A-/Watch Neg A-
2006-NC1 M-8 BBB+/Watch Neg BBB+
2006-NC1 M-9 BBB-/Watch Neg BBB-
2006-NC2 M-8 BBB/Watch Neg BBB
2006-NC2 M-9 BBB-/Watch Neg BBB-
2006-NC2 B-1 BB+/Watch Neg BB+
2006-NC3 M-8 BBB+/Watch Neg BBB+
2006-NC3 M-9 BBB/Watch Neg BBB
2006-NC3 M-10 BBB-/Watch Neg BBB-
2006-RS6 B BB/Watch Neg BB
RASC Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-AHL2 M-9 BBB/Watch Neg BBB
2005-AHL2 M-10 BBB-/Watch Neg BBB-
2005-AHL3 M-5 A/Watch Neg A
2005-AHL3 M-6 A-/Watch Neg A-
2005-AHL3 M-7 BBB+/Watch Neg BBB+
2005-AHL3 M-8 BBB/Watch Neg BBB
2005-AHL3 M-9 BBB-/Watch Neg BBB-
Securitized Asset Backed Receivables LLC Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-FR5 B-3 BBB/Watch Neg BBB
2005-FR5 B-4 BBB-/Watch Neg BBB-
2005-OP2 B3 BBB/Watch Neg BBB
2006 FR2 B2 BBB/Watch Neg BBB
2006 FR2 B3 BBB-/Watch Neg BBB-
2006 FR2 B4 BB+/Watch Neg BB+
2006 FR2 B5 BB/Watch Neg BB
2006-FR3 B1 BBB+/Watch Neg BBB+
2006-FR3 B2 BBB/Watch Neg BBB
2006-FR3 B3 BBB-/Watch Neg BBB-
2006-FR3 B4 BB+/Watch Neg BB+
2006-FR3 B5 BB/Watch Neg BB
2006-FR4 B3 BBB-/Watch Neg BBB-
2006-HE1 B1 BBB+/Watch Neg BBB+
2006-HE1 B2 BBB/Watch Neg BBB
2006-HE1 B3 BBB-/Watch Neg BBB-
2006-HE1 B4 BB+/Watch Neg BB+
2006-HE1 B5 BB/Watch Neg BB
2006-NC1 M3 A-/Watch Neg A-
2006-NC1 B1 BBB+/Watch Neg BBB+
2006-NC1 B2 BBB/Watch Neg BBB
2006-NC2 B2 BBB/Watch Neg BBB
2006-NC2 B3 BBB-/Watch Neg BBB-
2006-NC2 B4 BB+/Watch Neg BB+
2006-NC2 B5 BB/Watch Neg BB
2006-WM1 B2 BBB/Watch Neg BBB
2006-WM1 B3 BBB-/Watch Neg BBB-
SG Mortgage Securities Trust
Rating
------
Series Class To From
------ ----- -- -----
2005-OPT1 M12 BB+/Watch Neg BB+
2005-OPT1 M13 BB/Watch Neg BB
2006-FRE1 M7 A-/Watch Neg A-
2006-FRE1 M8 BBB+/Watch Neg BBB+
2006-FRE1 M9 BBB-/Watch Neg BBB-
2006-FRE1 M10 BBB-/Watch Neg BBB-
2006-FRE2 M6 A/Watch Neg A
2006-FRE2 M7 BBB+/Watch Neg BBB+
2006-FRE2 M8 BBB/Watch Neg BBB
2006-FRE2 M9 BBB-/Watch Neg BBB-
2006-FRE2 M10 BBB-/Watch Neg BBB-
Soundview Home Equity Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-OPT3 M12 BB/Watch Neg BB
Soundview Home Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-2 B1, B2 BB+/Watch Neg BB+
2006-2 B3 BB/Watch Neg BB
2006-3 M9 BBB-/Watch Neg BBB-
2006-3 M10 BB+/Watch Neg BB+
Specialty Underwriting and Residential Finance Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-AB2 B2 BBB/Watch Neg BBB
2005-AB2 B3 BBB-/Watch Neg BBB-
2005-BC3 B3 BBB-/Watch Neg BBB-
2005-BC3 B4 BB+/Watch Neg BB+
Structured Asset Investment Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-8 M-7 BBB+/Watch Neg BBB+
2005-8 M-8 BBB/Watch Neg BBB
2005-8 M-9 BBB-/Watch Neg BBB-
2005-9 M8 BBB/Watch Neg BBB
2005-9 M9 BBB-/Watch Neg BBB-
2005-9 B1 BBB-/Watch Neg BBB-
2005-11 M6 BBB+/Watch Neg BBB+
2005-11 M7 BBB/Watch Neg BBB
2005-11 M8 BBB-/Watch Neg BBB-
2006-1 M6 A/Watch Neg A
2006-1 M7 A-/Watch Neg A-
2006-1 M8 BBB+/Watch Neg BBB+
2006-1 M9 BBB/Watch Neg BBB
2006-2 M5 A-/Watch Neg A-
2006-2 M6 BBB+/Watch Neg BBB+
2006-3 M8 BBB/Watch Neg BBB
2006-3 M9 BBB-/Watch Neg BBB-
2006-3 B1 BB+/Watch Neg BB+
2006-4 M4 A/Watch Neg A
2006-4 M5 A-/Watch Neg A-
2006-4 M6 BBB+/Watch Neg BBB+
2006-4 M7 BBB/Watch Neg BBB
2006-4 M8 BBB-/Watch Neg BBB-
2006-4 B1 BB+/Watch Neg BB+
2006-BNC1 M5 A-/Watch Neg A-
2006-BNC2 M4 A/Watch Neg A
2006-BNC2 M5 A-/Watch Neg A-
2006-BNC2 M6 BBB+/Watch Neg BBB+
Structured Asset Securities Corporation Mortgage
Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2006-AM1 M8 BBB/Watch Neg BBB
2006-AM1 M9 BBB/Watch Neg BBB
2006-AM1 B1 BBB-/Watch Neg BBB-
2006-AM1 B2 BB+/Watch Neg BB+
2006-BC1 M8 A-/Watch Neg A-
2006-BC1 M9 BBB+/Watch Neg BBB+
2006-BC1 B1 BBB/Watch Neg BBB
2006-BC1 B2 BB+/Watch Neg BB+
2006-BC2 B1 BB+/Watch Neg BB+
2006-BC2 B2 BB/Watch Neg BB
2006-NC1 M7 BBB+/Watch Neg BBB+
2006-NC1 M8 BBB/Watch Neg BBB
2006-NC1 M9 BBB-/Watch Neg BBB-
2006-NC1 B1 BB+/Watch Neg BB+
2006-NC1 B2 BB/Watch Neg BB
2006-OW1 M6 A-/Watch Neg A-
2006-OW1 M7 BBB+/Watch Neg BBB+
2006-OW1 M8 BBB/Watch Neg BBB
Structured Asset Securities Corporation Trust
Rating
------
Series Class To From
------ ----- -- ----
2005-AR1 M8 BBB/Watch Neg BBB
Terwin Mortgage Trust
Rating
------
Series Class To From
------ ----- -- -----
2005-14HE B1 BBB+/Watch Neg BBB+
2005-14HE B2 BBB/Watch Neg BBB
2005-14HE M6 A-/Watch Neg A-
2006-17HE M3 A-/Watch Neg A-
2006-17HE M4 BBB+/Watch Neg BBB+
* Phoenix Management Names John Leach as Director
-------------------------------------------------
Phoenix Management Services, Inc. has hired John A. Leach as a
director. Mr. Leach will work with distressed and growth-oriented
middle market companies to deliver Phoenix's unique blend of
turnaround management, capital advisory, and operational due
diligence services.
With over 15 years of experience in both corporate and consulting
environments, Mr. Leach brings a wealth of operational and
financial expertise to the Phoenix team. "Jack is a great
addition to our growing firm," said managing director and
shareholder Mitchell B. Arden. "His knowledge of business drivers
across a number of industries plus his past executive management
roles will help enhance the value of Phoenix's middle market
clientele."
Prior to joining Phoenix, Mr. Leach served as the managing partner
of Enterprise Financial Consulting Group, a boutique consulting
firm headquartered in the eastern U.S. Other prior positions
include Managing Member of Previsio Group, whose clients included
Tyco International, Teleglobe USA and comScore Networks, CFO for
The Global TeleExchange, Inc., and positions at CACI, Inc., a
publicly traded, multinational government and commercial
technology contractor.
Mr. Leach received his BBA in Finance from the Mason School of
Business at the College of William & Mary in Virginia and is
currently a candidate for the Chartered Financial Analyst
designation. He is a member of the Leadership Council in Delaware
for the National Federation of Independent Businesses. He is
fluent in English and Spanish and has varying levels of fluency in
five other languages.
About Phoenix Management
Phoenix Management Services -- http://www.phoenixmanagement.com/-
- is a recognized leader in operationally-focused turnaround,
crisis and interim management and strategic advisory services to
middle market companies in transition. Since 1985, Phoenix has
aggressively advocated on behalf of its clients in more than 800
assignments nationwide across a variety of situations and
industries.
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
-------------------------------------------------------------
Recent Chapter 11 cases filed with assets and liabilities below
$1,000,000:
In Re Century Contractors, Inc.
Bankr. N.D. Ill. Case No. 07-11932
Chapter 11 Petition filed July 4, 2007
See http://bankrupt.com/misc/ilnb07-11932.pdf
In Re Anchor Distribution Services, Inc.
Bankr. N.D. Calif. Case No. 07-42087
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/canb07-42087.pdf
In Re 291, Inc.
Bankr. N.D. Ga. Case No. 07-70711
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/ganb07-70711.pdf
In Re Hot Dogs Del Mar, Inc.
Bankr. S.D. N.Y. Case No. 07-12091
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/nysb07-12091.pdf
In Re Exodus Breeders Corporation
Bankr. M.D. Pa. Case No. 07-02059
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/pamb07-02059.pdf
In Re Robert Kenneth Carver
Bankr. M.D. Tenn. Case No. 07-04639
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/tnmb07-04639.pdf
In Re Restaurant Catering & Management, Inc.
Bankr. S.D. Tex. Case No. 07-34582
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/txsb07-34582.pdf
In Re New Found Metals, Inc.
Bankr. W.D. Wash. Case No. 07-13102
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/wawb07-13102.pdf
In Re Triangle Unlimited, L.L.C.
Bankr. W.D. Wash. Case No. 07-13107
Chapter 11 Petition filed July 5, 2007
See http://bankrupt.com/misc/wawb07-13107.pdf
In Re R.R.C. Development, L.L.C.
Bankr. D. Ariz. Case No. 07-03180
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/azb07-03180.pdf
In Re Yolanda R. Lawler
Bankr. C.D. Calif. Case No. 07-13850
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/cacb07-13850.pdf
In Re Brother Oliver's Fare and Spirits, Inc.
Bankr. E.D. Calif. Case No. 07-25199
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/caeb07-25199.pdf
In Re G&K Systems, Inc.
Bankr. D. Mass. Case No. 07-14243
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/mab07-14243.pdf
In Re Lamond N.M.I. Rushing, Sr.
Bankr. W.D. Mo. Case No. 07-42275
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/mowb07-42275.pdf
In Re P.P.F., L.L.C.
Bankr. W.D. Pa. Case No. 07-24333
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/pawb07-24333.pdf
In Re Torres Security Police, Inc.
Bankr. D. P.R. Case No. 07-03798
Chapter 11 Petition filed July 6, 2007
See http://bankrupt.com/misc/prb07-03798.pdf
In Re Penny Elizabeth Hoelting
Bankr. D.C. Case No. 07-00340
Chapter 11 Petition filed July 7, 2007
See http://bankrupt.com/misc/dcb07-00340.pdf
In Re Urban Mall Houston, L.P.
Bankr. S.D. Tex. Case No. 07-20368
Chapter 11 Petition filed July 8, 2007
See http://bankrupt.com/misc/txsb07-20368.pdf
In Re 8680 Monroe Court, Inc.
Bankr. C.D. Calif. Case No. 07-15782
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/cacb07-15782.pdf
In Re Hamilton-Boxer, Inc.
Bankr. D. Conn. Case No. 07-31536
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/ctb07-31536.pdf
In Re M.&M. Jewelers, Inc.
Bankr. W.D. Ky. Case No. 07-40702
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/kywb07-40702.pdf
In Re Michelle L. Kalman
Bankr. D. Mass. Case No. 07-14268
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/mab07-14268.pdf
In Re Michael Tauro
Bankr. D. N.J. Case No. 07-19559
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/njb07-19559.pdf
In Re Armando Tauro
Bankr. D. N.J. Case No. 07-19561
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/njb07-19561.pdf
In Re La Paloma Tortilla Factory, Inc.
Bankr. S.D. Tex. Case No. 07-10424
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/txsb07-10424.pdf
In Re Ruggles Cafe Bakery, Ltd.
Bankr. S.D. Tex. Case No. 07-34626
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/txsb07-34626.pdf
In Re Michael H. Mercier
Bankr. W.D. Wis. Case No. 07-12613
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/wiwb07-12613.pdf
In Re Jeffrey L. Nerby
Bankr. W.D. Wis. Case No. 07-12627
Chapter 11 Petition filed July 9, 2007
See http://bankrupt.com/misc/wiwb07-12627.pdf
In Re Queen Bee of Beverly Hills, L.L.C.
Bankr. N.D. Ala. Case No. 07-81725
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/alnb07-81725.pdf
In Re N.E.A. Unlimited, Inc.
Bankr. D. Colo. Case No. 07-17348
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/cob07-17348.pdf
In Re Sienna, L.L.C.
Bankr. S.D. Fla. Case No. 07-15337
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/flsb07-15337.pdf
In Re Stevens Tire Co., Inc.
Bankr. M.D. Ga. Case No. 07-51563
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/gamb07-51563.pdf
In Re Bridgeton Building, L.L.C.
Bankr. D. N.J. Case No. 07-19629
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/njb07-19629.pdf
In Re Garson & Sons, Inc.
Bankr. D. N.M. Case No. 07-11646
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/nmb07-11646.pdf
In Re Thurman L. Pedigo, Sr.
Bankr. M.D. Tenn. Case No. 07-04779
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/tnmb07-04779.pdf
In Re Swanson Semiconductor Service, L.L.C.
Bankr. N.D. Tex. Case No. 07-42971
Chapter 11 Petition filed July 10, 2007
See http://bankrupt.com/misc/txnb07-42971.pdf
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, John Paul C. Canonigo, Sheena Jusay, and
Peter A. Chapman, Editors.
Copyright 2007. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
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 ***