TCR_Public/070820.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Monday, August 20, 2007, Vol. 11, No. 196

                             Headlines

ACCENTIA BIOPHARMA: June 30 Balance Sheet Upside-Down by $61 Mil.
ADELPHIA COMMS: Reports Distributions to Holders of Allowed Claims
AEGIS MORTGAGE: U.S. Trustee Sets Sec. 341(a) Meeting on Sept. 19
AIRTRAN HOLDINGS: Ends Efforts to Acquire Midwest Air Group
AIRTRAN HOLDINGS: Midwest Inks $17/Share Merger Deal With TPG

AMERCIAN SOFTGEL: Case Summary & 20 Largest Unsecured Creditors
AMERICAN COLOR: Merger Pact Signing with Vertis Slated Today
AMERICAN HOME: Taps Cadwalader Wickersham as Special Counsel
AMERICAN HOME: Inks Pact Clarifying Terms of $8MM JPMorgan Bailout
AMERICREDIT CORP: Extends $500 Million Repurchase Facility

AMPHENOL CORP: Moody's Withdraws Ba1 Corporate Family Rating
ANDREW CORP: Obtains Info Requests on CommScope's Purchase Deal
ARAMARK CORP: 8.5% Sr. Notes Offer Set to Expire on Wednesday
ASSET SECURITIZATION: Moody's Affirms "C" Class A-4 Cert. Rating
BALLY TOTAL: Noteholders Back Amendment of Reorganization Plan

BANK OF QUEENSLAND: Moody's Affirms "C" Financial Strength Rating
BARMA FOODS: Case Summary & 22 Largest Unsecured Creditors
BARNERT MEMORIAL: Case Summary & 38 Largest Unsecured Creditors
BEKINS QUARTER: Case Summary & 11 Largest Unsecured Creditors
BELL MICROPRODUCTS: Obtains Add'l Nasdaq Determination Notice

BOSTON SCIENTIFIC: Mulls Sale of Cardiac & Vascular Surgery Units
BROADCAST INT'L: June 30 Balance Sheet Upside-Down by $3.7 Million
CARDSYSTEMS SOLUTIONS: Court Set to Confirm Plan on Sept. 13
CDO OF ABS: S&P Lowers Ratings on 50 Tranches from 12 Transactions
CMC TELECOM: Case Summary & 18 Largest Unsecured Creditors

COMMSCOPE INC: Obtains Requests for Add'l Info on Andrew's Buyout
CREDIT SUISSE: Fitch Cuts Rating on $18.8MM Class N Certs. to B-
CROWN CLO: Full Note Redemption Cues S&P to Withdraw Ratings
DEERFIELD TRIARC: Unstable Credit Markets Delay Buy of Deerfield
DELPHI CORP: Inks MOU with Steelworkers and General Motors

DENALI CAPITAL: Note Redemptions Cue S&P to Withdraw Ratings
DRS TECHNOLOGIES: Moody's Affirms B1 Corporate Family Rating
EMTA HOLDINGS: Losses Cue Auditor's Going Concern Doubt Opinion
GE CAPITAL: Moody's Affirms Low-B Ratings on Four Cert. Classes
GENERAL MOTORS: Union Workers Will Strike If Contract Talks Fail

GENERAL MOTORS: Inks MOU with Steelworkers and Delphi Corp.
GVI SECURITY: Reports Net Income of $308,000 in Second Quarter
H.Q.Z. PROPERTIES: Voluntary Chapter 11 Case Summary
HANOVER COMPRESSOR: Stockholders OK Universal Compression Merger
HAWK CORP: S&P Holds "B" Rating and Removes Negative CreditWatch

IMPAC CMB: Moody's Hold B2 Rating on $11.1 Million Class G Certs.
INLAND EMPIRE: Fitch Rates $18.948 Million Term Bonds at BB
INTEGRA TELECOM: Moody's Rates $645 Mil. Credit Facility at Ba3
INTEGRA TELECOM: S&P Affirms B- Corporate Credit Rating
INTEGRAL NUCLEAR: Exclusive Plan Filing Period Moved to Dec. 11

INTERFACE INC: To Redeem Outstanding 7.3% Sr. Notes on Sept. 29
JRH HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
K.X.D. TECHNOLOGY: Case Summary & 18 Largest Unsecured Creditors
LEVEL 3: Douglas Eby and Michael Mahoney Joins Board of Directors
LEVI STRAUSS: Moody's Affirms B1 Corporate Family Rating

NEPHROS INC: June 30 Balance Sheet Upside-Down by $5.0 Million
MERRILL LYNCH: S&P Assigns Default Rating on Class H Certificates
MERRILL LYNCH: Fitch Assigns Low-B Ratings on Six Cert. Classes
MERITAGE HOMES: Moody's Lowers Corporate Family Rating to Ba3
MITEL NETWORKS: Zarlink Sells Equity Interest for $12.9 Million

MITEL NETWORKS: Completes Merger Transaction with Inter-Tel Inc.
ML-CFC COMMERCIAL: Fitch Holds Low-B Ratings on Six Cert. Classes
MORGAN STANLEY: Fitch Affirms B- Rating on $4MM Class O Certs.
MORGAN STANLEY: Stable Performance Cues Fitch to Affirm Ratings
MORTGAGE CAPITAL: Moody's Junks Rating on Class J Certificates

MOUI TRAN: Voluntary Chapter 11 Case Summary
MOVIE GALLERY: Extends Forbearance Agreement until August 27
MXENERGY HOLDINGS: Ends Offer for Floating Rate Senior Notes
PALM HARBOR: Case Summary & 20 Largest Unsecured Creditors
PENN TREATY: S&P Lowers Counterparty Credit Rating to B- from B

PHILIP JOHNSON: Case Summary & Four Largest Unsecured Creditors
PHOENIX FOOTWEAR: Posts $929,000 Net Loss in Qtr. Ended June 30
POWER EFFICIENCY: Posts $837,000 Net Loss in Quarter Ended June 30
PRUDENTIAL MORTGAGE: Gets $25.8 Mil. Funding for Fisher Building
PRUDENTIAL SECURITIES: Moody's Junks Ratings on Two Cert. Classes

PRUDENTIAL SECURITIES: Moody's Holds Caa1 Rating on Class N Certs.
PUBLICARD INC: Inks LOI to Fund Plan of Reorganization
QUAKER FABRIC: Files for Chapter 11 Bankruptcy Protection
QUESTEX MEDIA: Acquires “The Show” Producers - Oxford Publishing
RADNET MANAGEMENT: S&P Withdraws Bank Loan and Recovery Ratings

RAHSAAN DELANEY: Voluntary Chapter 11 Case Summary
RESIDENTIAL CAPITAL: Fitch Lowers Long-Term IDR to BB+ from BBB
RESIDENTIAL CAPITAL: Moody's Lowers Senior Debt Rating to Ba1
RUGGLES RESTAURANT: Voluntary Chapter 11 Case Summary
RYERSON INC: ISS Urges Shareholders to Re-Elect Board of Directors

SCOTTISH RE: Has Over $500MM Available Liquidity as of June 30
SECURE COMPUTING: Improved Performance Cues S&P to Lift Rating
SENTINEL MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
SEQUIAM CORP: CEO's Purchase of Biometrics Investors Cures Default
SHAW GROUP: Gets $50 Mil. Engineering Contract with Dagu Chemical

SIMTROL INC: Posts $881,575 Net Loss in Quarter Ended June 30
SITHE/INDEPENDENCE: S&P Holds "B" Rating on $559.5MM Secured Bonds
TARRAGON CORP: Will Delay Filing of 10Q for Quarter Ended June 30
TARRAGON CORP: Receives Notice of Default from Barclays Capital
TELTRONICS INC: Posts $1.5 Mil. Net Loss in Quarter Ended June 30

TIMKEN CO: Explores Strategic Alternatives to Accelerate Growth
TIMKEN CO: Board Declares $0.17 Per Share Quarterly Dividend
TRANSNATIONAL FINANCIAL: Bedinger Raises Going Concern Doubt
TRIARC COS: Unstable Market Delays Sale of Deerfield & Co. Stake
TXU CORP: Board Declares Common Dividend of 43.25 Cents Per Share

UNIGENE LABS: June 30 Balance Sheet Upside-Down by $15 Million
UNITED AMERICAN: Earns $432,497 in Second Quarter Ended June 30
UNIVERSAL COMPRESSION: Stockholders Supports Merger with Hanover
UNIVERSAL HOSPITAL: June 30 Balance Sheet Upside-Down by $243 Mil.
VERTIS COMM: Merger Pact Signing With American Color Moved Today

ZI CORPORATION: Receives Nasdaq Staff Deficiency Letter
ZI CORPORATION: Posts $1.2 Mil. Net Loss in Quarter Ended June 30

* Donlin Recano To Provide Our Lady of Mercy Bankruptcy News
* Fitch Places All Classes from 58 Transactions Under Neg. Watch
* Moody's Assessed 705 Tranches from Mortgage Loans Transactions

* BOND PRICING: For the Week of August 13 - August 18, 2007

                              *********

ACCENTIA BIOPHARMA: June 30 Balance Sheet Upside-Down by $61 Mil.
-----------------------------------------------------------------
Accentia Biopharmaceuticals Inc. reported on Aug. 14, 2007, its e
financial results for the fiscal 2007 third quarter ended June 30,
2007.

At June 30, 2007, the company's consolidated financial statements
showed $34.7 million in total assets, $90.3 million in total
liabilities, and $5.4 million in non=controlling interest in
variable interest entities, resulting in a $61.0 million total
stockholders' deficit.

The company's consolidated balance sheet at June 30, 2007, also
showed strained liquidity with $11.5 million in total current
assets available to pay $64.1 million in total current
liabilities.

Accentia's third quarter net loss, on a fully consolidated basis,
including Biovest, was $25.0 million, compared with $12.1 million
reported for the same three-month period in fiscal 2006.  60% of
this loss consisted of non-cash items totaling a net of
$15.0 million and consisted primarily of a $9.7 million loss on
the extinguishment of debt, $3.8 million impairment related to MD
Turbo, $2.1 million accretion of debt discounts, and $2.7 million
in warrants issued for expensed finance costs offset by a change
in fair market value of convertible debentures of $3.9 million.

On a fully consolidated basis, including Biovest, net sales for
the three months ended June 30, 2007, were $3.8 million, compared
with $5.7 million for the same period a year ago.  The
$1.9 million decline in net sales largely reflects the strategic
divestiture of the Xodol and Histex product lines in the company's
specialty pharmaceuticals division earlier in the year.  Although
specialty pharmaceutical revenues are down, the product
divestitures have improved the company's operating cost structure.
Sales and Marketing expenses have decreased $2.2 million, or 54%.
Research and development costs for the third quarter increased to
$5.1 million, compared with $3.5 million for the same fiscal
quarter in 2006.  The increase was primarily attributable to
activity in the company's pivotal Fast Tracked phase 3 clinical
trial on SinuNase.

                        Capital Resources

On a fully consolidated basis, as of June, 2007, Accentia's
capital resources were approximately $8.7 million, consisting of
cash, restricted cash, and availability under lines of credit.
Additionally, as of June 30, 2007, Accentia carried an inter-
company demand note from Biovest in the amount of $10.0 million.
As of June 30, 2007 Accentia owned Biovest common shares valued in
excess of $54.8 million, based on Biovest's market price at the
close of the quarter.  

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a6

                       Going Concern Doubt

As reported in the Troubled Company Reporter on Jan. 5, 2007,
Aidman, Piser & Company P.A. expressed substantial doubt about
Accentia Biopharmaceuticals Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
years ended Sept. 30, 2006, and 2005.  The auditing firm pointed
to the company's cumulative net losses of approximately
$111.4 million during the three years ended Sept. 30, 2006, and
working capital deficiency of approximately $20.5 million.

The company incurred net losses of $63.7 million and used cash
from operations of $32.3 million during the nine months ended
June 30, 2007, and has a working capital deficit of $52.6 million
at June 30, 2007.  Net losses and cash flow used in operations for
Biovest, whose results are consolidated with the company, were
$41.4 million and $9.3 million, respectively, during the same nine
month period.

                About Accentia Biopharmaceuticals

Based in Tampa, Florida, Accentia BioPharmaceuticals Inc. (Nasdaq:
ABPI) -- http://www.accentia.net/-- is a biopharmaceutical  
company focused on the development of late-stage "disruptive"
clinical products, especially for already-approved drugs in new
formulations and/or new indications that are patent-protected and
which represent new therapeutics with greater clinical and
economic value.  Accentia has a pipeline of products in late-stage
clinical development. The company's lead respiratory product
candidate is SinuNase(TM), which is under clinical development to
treat chronic sinusitis (rhinosinusitis).  The company's other
lead product is BiovaxID(TM), a patient-specific anti-cancer
vaccine for the treatment of follicular non-Hodgkin's lymphoma.

Through its subsidiary, Biovest International Inc. (OTC BB: BVTI),
the company also manufactures AutovaxID(TM), an FDA approved
commercial-stage automated cell-manufacturing device that enables
the cost-effective and scalable production of proteins and other
cell-based products.


ADELPHIA COMMS: Reports Distributions to Holders of Allowed Claims
------------------------------------------------------------------
Adelphia Communications Corporation disclosed subsequent
distributions of $531 million in cash and 6,453,341 shares of TWC
Class A Common Stock to holders of Allowed Claims against the
parent Adelphia Communications Corporation pursuant to the First
Modified Fifth Amended Joint Chapter 11 Plan of Reorganization of
Adelphia Communications Corporation and Certain Affiliated
Debtors, dated as of Jan. 3, 2007, as confirmed.  The 6,453,341
shares of TWC Class A Common Stock to be distributed have a
"Deemed Value" under the Plan of $244 million and a fair market
value as of Aug. 16, 2007 (based on the closing price on that
date) of $220 million.

A chart summarizing the distribution of cash and shares of TWC
Class A Common Stock to be made to classes of ACC Claims is
available for free at http://ResearchArchives.com/t/s?22ab

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.


AEGIS MORTGAGE: U.S. Trustee Sets Sec. 341(a) Meeting on Sept. 19
-----------------------------------------------------------------
Kelly Beaudin Stapleton, the United States Trustee for Region 3,
scheduled a meeting of Aegis Mortgage Corporation and its debtor-
affiliates' creditors for Sept. 19, 2007, 2:00 p.m., at Room 2112,
2nd Floor, J. Caleb Boggs Federal Building, in Wilmington,
Delaware.

This is the first meeting of creditors required under 11 U.S.C.
Sec. 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 office of the Debtor under oath about the
company's financial affairs and operations that would be of
interest to the general body of creditors.

Headquartered in Houston, Texas, Aegis Mortgage Corporation --
http://www.aegismtg.com/-- offers a variety of mortgage loan
products to brokers through its subsidiaries.

The company together with 10 affiliates filed for chapter 11
protection on Aug. 13, 2007 (Bankr. D. Del. Case No. 07-11119)
Curtis A. Hehn, Esq., James E. O'Neill, Esq., Laura Davis Jones,
Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl,
Young, Jones and Weintraub, L.L.P., are the proposed counsel
for the Debtors.  When the Debtors filed for bankruptcy, they
listed assets and debts of more than $100 million.

The Debtors' exclusive period to file a plan expires on
Dec. 11, 2007.  Aegis Bankruptcy News, Issue No. 3, Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/     
or 215/945-7000).


AIRTRAN HOLDINGS: Ends Efforts to Acquire Midwest Air Group
-----------------------------------------------------------
AirTran Holdings Inc., the parent of AirTran Airways, ended its
efforts to acquire Midwest Air Group, Inc., after the Midwest
board rejected AirTran's enhanced offer and agreed to sell Midwest
Airlines to TPG Capital and Northwest Airlines.

"We sought to acquire Midwest because we believe joining the two
airlines would have created a unique, efficient, truly national
low-cost carrier with tremendous benefits for shareholders,
communities and employees," said Joe Leonard, Chairman and CEO of
AirTran Airways. "We hoped the Midwest board would come to share
our vision and reach a consensual agreement - just as a majority
of Midwest shareholders recognized the value in our strategic
plan. However, we accept the Midwest board's decision.

"AirTran will continue our focus on growth -- a strategy that has
produced eight consecutive years of profitable expansion. We
sought to acquire Midwest because a merger made strategic and
operational sense - and we pursued a deal vigorously, and for the
right reasons," he said. "But AirTran doesn't need to merge with
any other carrier to achieve our business goals.

"AirTran will keep doing what we do best - adding new markets and
aircraft in a smart, self-disciplined way, and continuing to
provide outstanding customer service and low fares."

                      About Midwest Air

Headquartered in Oak Creek, Wisconsin, Midwest Air Group Inc.
(Amex: MEH) -- http://www.midwestairlines.com-- the parent     
company of Midwest Airlines, provides scheduled passenger
service in the United States and internationally.  It offers
scheduled passenger service to destinations in the United
States and regional scheduled passenger service to cities
primarily in the Midwest and to Toronto, Canada.

                    About Airtran Holdings

AirTran Holdings Inc., through its subsidiary AirTran Airways Inc.
(NYSE: AAI) -- http://www.airtran.com/-- operates over 600 daily    
flights to 50 destinations.  The airline's hub is at Hartsfield-
Jackson Atlanta International Airport, where it is the second
largest carrier.  AirTran Airways recently added the fuel-
efficient Boeing 737-700 aircraft to create America's youngest
all-Boeing fleet.  The airline is also the first carrier to
install XM Satellite Radio on a commercial aircraft and the only
airline with Business Class and XM Satellite Radio on every
flight.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 15, 2006,
Standard & Poor's Ratings Services affirmed its ratings on AirTran
Holdings Inc. and its primary operating subsidiary, AirTran
Airways Inc., including the 'B-' corporate credit rating on
AirTran Holdings.

As reported in the Troubled Company Reporter on Nov. 23, 2006,
Moody's Investors Service confirmed its B3 Corporate Family Rating
for AirTran Holdings Inc. and its Caa1 rating on the company's
7% Guaranteed Convertible Notes Due July 1, 2023, in connection
with its implementation of its Probability-of-Default and Loss-
Given-Default rating methodology for the Transportation sector.

Moody's also assigned an LGD6 rating to those loans, suggesting
noteholders will experience a 91% loss in the event of a default.


AIRTRAN HOLDINGS: Midwest Inks $17/Share Merger Deal With TPG
-------------------------------------------------------------
Midwest Air Group, parent company of Midwest Airlines, has signed
a definitive merger agreement to be acquired by an affiliate of
TPG Capital, L.P. in a transaction valued at approximately
$450 million.  The merger agreement was unanimously approved by
the Midwest Air Group Board of Directors.

Under the terms of the agreement, each outstanding share of
Midwest's common stock will be converted into the right to
receive $17.00 per share in cash.  On Dec. 12, 2006, the last
trading day before the public announcement of AirTran's indication
of interest in acquiring Midwest, the per share price of Midwest's
common stock was $9.08.  Midwest has approximately 26.6 million
shares outstanding, including shares subject to options,
restricted share awards and outstanding warrants.

"This is a significant milestone for Midwest," said Timothy E.
Hoeksema, chairman and chief executive officer.  "The agreement
preserves the airline's status as Milwaukee's hometown airline
and the popular Midwest Airlines brand for Midwest's loyal
customers and employees.  TPG shares our commitment to quality
and truly understands the value of a differentiated product.
We're looking forward to a long-term relationship with TPG, and
benefiting from their strength and experience."

Richard P. Schifter, partner, TPG Capital, added, "TPG is
excited about the opportunity to invest in Midwest Airlines,
which has managed to preserve a quality of service to its
passengers rarely seen today. We look forward to working with
management and its highly motivated workforce in driving growth
and creating more value.  We hope that our industry experience,
together with an expanded alliance with Northwest Airlines, will
lead to a bigger and better Midwest."

The transaction is expected to be completed in the fourth quarter
of 2007.  All financing for the transaction is in the form of
equity and has been committed.  No debt financing is required.  
The transaction is subject to approval by Midwest's shareholders,
as well as other customary conditions, including anti-trust
approvals.

The agreement with TPG came at the conclusion of a process in
which TPG and AirTran were each asked to submit a "best and final"
offer by noon Central time on August 16, 2007.  At that time, TPG
submitted its $17.00 per share proposal.

    -- The TPG proposal was weighed against a proposal from
       AirTran of $16.27 per share in cash and AirTran stock.
       More specifically, AirTran proposed to pay $10.00 in cash
       plus a fraction of a share of its stock having a value of
       $6.27 based upon an average market price during a specified
       period leading up to closing, so long as (i) AirTran's
       stock averaged between $9.32 and $11.39 during such period
       and (ii) AirTran was able to obtain at least $150 million
       of debt financing at an interest cost not exceeding 13.5%
       per annum.  AirTran's debt commitment letters were subject
       to a "market out" condition.

    -- If AirTran's debt financing had not been available on such
       terms, AirTran would have had the option of reducing the
       cash component to as low as approximately $4.35 per share
       and issuing a fraction of a share of its stock having a
       value of $11.92 based upon an average market price during
       the valuation period, so long as AirTran's stock averaged
       between $9.32 and $11.39 during such period.  In such
       instances, depending upon the number of AirTran shares to
       be issued, the transaction would have been conditioned upon
       approval by AirTran's shareholders.

    -- If the average stock price during the valuation period were
       outside the $9.32 and $11.39 collars, the amount of AirTran
       shares issued no longer floated but became fixed.  The per
       share value at closing of the total consideration could
       then have been less or more than $16.27 per share.

The Midwest board said it carefully considered the differences in
value, closing conditions and other terms between the TPG and
AirTran proposals and unanimously approved the TPG proposal.

Samuel K. Skinner, chairman of the board's special review
committee established in connection with the board's exploration
of strategic and financial alternatives and former Secretary of
the U.S. Department of Transportation, noted that "the board's
process was carefully designed to maximize value and the committee
received best and final offers from both bidders."

Goldman, Sachs & Co. is acting as financial advisor and Godfrey &
Kahn, S.C. and Sidley Austin LLP are acting as legal advisors to
Midwest Air Group in connection with the transaction.

Citigroup Global Markets Inc. is acting as financial advisor and
Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal
advisor to TPG in connection with the transaction.

                 Northwest as Passive Investor

According to Midwest, Northwest Airlines Corporation will be a
minority passive investor in Midwest Air Partners LLC, the entity
formed to acquire Midwest, which Northwest confirmed in an
Aug. 12, 2007 press statement.

Northwest, which is providing financing to facilitate the
transaction, said it will not participate in the management or
control of Midwest
should TPG acquire Midwest.

"The previously announced codeshare agreement between NWA and
Midwest Airlines will remain
in place and the two airlines will explore cost reduction
activities such as joint fuel purchasing," Northwest noted.


Northwest said it has briefed its union leadership on the
transaction.

                         About Northwest

Northwest Airlines Corporation (NYSE:NWA) is one of the world's
largest airlines with hubs at Detroit, Minneapolis/St. Paul,
Memphis, Tokyo and Amsterdam, and approximately 1,400 daily
departures.  Northwest and its travel partners serve more than
1,000 cities in excess of 160 countries on six continents.

                        About TPG Capital

TPG Capital is the global buyout group of TPG, a leading private
investment firm founded in 1992, with more than $30 billion of
assets under management and offices in San Francisco, London,
Hong Kong, New York, Minneapolis, Fort Worth, Melbourne, Menlo
Park,
Moscow, Mumbai, Shanghai, Singapore and Tokyo. TPG Capital has
extensive experience with global public and private investments
executed through leveraged buyouts, recapitalizations, spinouts,
joint ventures and restructurings.  TPG Capital's investments span
a variety of industries including travel, technology,
retail/consumer,
media and communications, industrials, financial services and
healthcare.

                      About Midwest Airlines

Headquartered in Oak Creek, Wisconsin, Midwest Air Group Inc.
(Amex: MEH) -- http://www.midwestairlines.com-- the parent     
company of Midwest Airlines, provides scheduled passenger
service in the United States and internationally.  It offers
scheduled passenger service to destinations in the United
States and regional scheduled passenger service to cities
primarily in the Midwest and to Toronto, Canada.

                     About AirTran Holdings

AirTran Holdings Inc., through its subsidiary AirTran Airways Inc.
(NYSE: AAI) -- http://www.airtran.com/-- operates over 600 daily    
flights to 50 destinations.  The airline's hub is at Hartsfield-
Jackson Atlanta International Airport, where it is the second
largest carrier.  AirTran Airways recently added the fuel-
efficient Boeing 737-700 aircraft to create America's youngest
all-Boeing fleet.  The airline is also the first carrier to
install XM Satellite Radio on a commercial aircraft and the only
airline with Business Class and XM Satellite Radio on every
flight.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 15, 2006,
Standard & Poor's Ratings Services affirmed its ratings on AirTran
Holdings Inc. and its primary operating subsidiary, AirTran
Airways Inc., including the 'B-' corporate credit rating on
AirTran Holdings.

As reported in the Troubled Company Reporter on Nov. 23, 2006,
Moody's Investors Service confirmed its B3 Corporate Family Rating
for AirTran Holdings Inc. and its Caa1 rating on the company's
7% Guaranteed Convertible Notes Due July 1, 2023, in connection
with its implementation of its Probability-of-Default and Loss-
Given-Default rating methodology for the Transportation sector.

Moody's also assigned an LGD6 rating to those loans, suggesting
noteholders will experience a 91% loss in the event of a default.


AMERCIAN SOFTGEL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Amercian Softgel
        aka National Vitamin Co., L.L.C.
        7440 South Dean Martin Drive, Suite 206
        Las Vegas, NV 89139

Bankruptcy Case No.: 07-15108

Type of business: The Debtor manufactures pharmaceutical
                  preparations.

Chapter 11 Petition Date: August 16, 2007

Court: District of Nevada (Las Vegas)

Debtor's Counsel: Michael R. Mushkin, eSQ.
                  Harmon, Davis & Mushkin, A.P.C.
                  4475 South Pecos Road
                  Las Vegas, NV 89121
                  Tel: (702) 386-3999

Estimated Assets:         Less than $50,000

Estimated Debts: $1 Million to $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
International Labs, Inc.                                 $355,449
2350 31st Street South
St. Petersburg, FL 33712

Mike Ive                                                 $250,000
Charlotte, NC

Sterling Gelatin                                         $233,056
4595 Sandesara Drive
Prince Georgia, VA 23875

Ocean Nutrition                                          $190,795

Innospec Performance Chemicals                           $133,806

Bascal Properties                                        $129,910

Gelita U.S.A., Inc.                                      $124,741

Sky Softgel Co., Ltd.                                    $122,990

Adpen Laboratories, Inc.                                  $80,956

Vinchem, Inc.                                             $60,340

Earl Courtney & Roger Mann                                $50,000

Focus Compliance & Validation                             $49,466

Betachem                                                  $48,000

Macfarland Ferguson &                                     $40,984
McMullen

Selective H.R. Solutions                                  $40,227

Nevada Power Co.                                          $38,020

BASF Corporation                                          $35,460

National Vitamin                                          $30,323

C.H. Robinson                                             $29,388

Brenntag Pacific                                          $28,284


AMERICAN COLOR: Merger Pact Signing with Vertis Slated Today
------------------------------------------------------------
American Color Graphics Inc. and Vertis Communications have agreed
to extend until today, Aug. 20, 2007, the signing of a definitive
merger agreement.  

After Aug. 20, 2007, the letter of intent will automatically
extend for a period of one week unless either party provides
written notice that it will not extend prior to the start of each
extension period.

The two companies reported the signing of a letter of intent to
merge on July 23, 2007, and are in the process of due diligence.

Vertis Communications, fka Vertis Inc., a wholly owned subsidiary
of Vertis Holdings -- http://www.vertisinc.com/-- is a marketing   
partner to a number of clients, including several Fortune 500
companies.  The company offers consulting, creative, research,
direct mail, media, technology and production services.  It also
provides print advertising, direct marketing solutions, and
similar services to America's retail and consumer services
companies.

Headquartered in Brentwood, Tennessee, American Color Graphics,
Inc. -- http://www.americancolor.com/-- is engaged in printing of    
advertising inserts and newspaper products in the United States.
The company is a wholly owned subsidiary of ACG Holdings, Inc.

The company operates in two segments: print and premedia services.
Customers for its print services include about 230 national and
regional retailers and approximately 155 newspapers.  The premedia
services segment provides its customers with a solution for the
preparation and management of materials for printing, including
the design, creation and capture; manipulation; storage;
transmission, and distribution of images.

At Dec. 31, 2006, the company's balance sheet showed $233,932,000
in total assets and $475,925,000 in total liabilities, resulting
in a stockholders' deficit of $241,993,000.

                          *     *     *

As reported in the Troubled Company Reporter on July 27, 2007,
Moody's Investors Service placed the ratings of American Color
Graphics Inc. under review for possible downgrade following the
announcement that the company plans to merge with Veris Inc.
Details of the rating action are:  $280 million senior secured
second priority notes due 2010 - Caa2; corporate family rating -
Caa2; probability of default rating - Caa2.

As reported in the Troubled Company Reporter on July 26, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
rating for Vertis Inc. to 'CC' from 'B-'.


AMERICAN HOME: Taps Cadwalader Wickersham as Special Counsel
------------------------------------------------------------
American Home Mortgage Investment Corp. and its debtor-affiliates
seek authority from the U.S. Bankruptcy Court for the District
of Delaware to employ Cadwalader, Wickersham & Taft LLP as their
special counsel on non-bankruptcy matters, nunc pro tunc to
August 6, 2007.

Michael Strauss, the Debtors' chief executive officer, informs
the Court that the Debtors seek to retain Cadwalader because of
its extensive history and experience as the Debtors' primary
outside counsel for the last eight years, hence, the firm possess
extensive knowledge about the Debtors' businesses.

Mr. Strauss discloses that Cadwalader is currently engaged in
litigation and corporate matters for the Debtors, which will
continue through the bankruptcy period.  He notes that Cadwalader  
is able to represent the Debtors with greater efficiency, speed
and effectiveness than any other counsel.  Thus, Cadwalader is
well qualified to serve as special counsel to the Debtors'
bankruptcy estate.

Among the tasks of Cadwalader are:

   -- general corporate matters and corporate governance issues;

   -- asset dispositions, including the potential merger among
      the Debtors' entities;

   -- tax, regulatory and securities law matters; and

   -- certain litigation matters.

The Debtors will pay Cadwalader on an hourly basis, plus
reimbursement of actual and necessary charges.  Cadwalader's
rates are subject to periodic adjustment to reflect economic and
other conditions.  Cadwalader's current hourly rates are:

     Partners                        $495 - $1,000
     Attorney/Counsel                $230 -   $675
     Legal Assistants                 $60 -   $225

Mr. Strauss discloses that Cadwalader has received approximately
$3,700,000 for its prepetition services since August 1, 2006.  He
further discloses that, as of Petition Date, Cadwalader was
holding an advance retainer of approximately $1,000,000 for its
services for the Debtors.  The Retainer will be applied against
postpetition fees and expenses as approved by the Court.

Gregory M. Petrick, Esq., a member of Cadwalader, discloses that
the firm represented certain clients in mortgage purchase and
other transactions with the Debtors, including Credit Suisse
Securities (USA) LLC, JPMorgan Securities Inc., Merrill Lynch
Global Markets, UBS Securities LLC, Natixis Capital Markets Inc.,
Morgan Stanley Co., Inc., Barclays Capital Inc., Goldman, Sachs &
Co., and Citigroup Global Markets, Inc.  However, he assures
Judge Sontchi that Cadwalader does not hold or represent an
interest that is adverse to the bankruptcy estate.

Based in Melville, New York, American Home Mortgage Investment
Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage    
real estate investment trust engaged in the business of investing
in mortgage-backed securities and mortgage loans resulting from
the securitization of residential mortgage loans originated and
serviced by its subsidiaries.  

American Home Mortgage and seven affiliates filed for chapter 11
protection on August 6, 2007 (Bankr. D. Del. Case Nos. 07-11047
through 07-11054).  James L. Patton, Jr., Esq., Joel A. Waite,
Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt &
Taylor LLP are the proposed counsel to the Debtors.  Epiq
Bankruptcy Solutions LLC is the proposed claims and noticing
agent. The Official Committee of Unsecured Creditors has
selected Hahn & Hessen LLP as its counsel.  As of March 31, 2007,
American Home Mortgage's balance sheet showed total assets of
$20,553,935,000, total liabilities of $19,330,191,000, and
total stockholders' equity of $1,223,744,000.  The Debtors'
exclusive period to file a plan expires on Dec. 4, 2007.
(American Home Bankruptcy News, Issue No. 3, Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN HOME: Inks Pact Clarifying Terms of $8MM JPMorgan Bailout
------------------------------------------------------------------
JPMorgan Chase Bank, N.A., and American Home Mortgage Investment
Corp. and its debtor-affiliates are parties to a secured revolving
warehouse facility dated January 24, 2006.  JPMorgan, as
administrative agent, received a first priority lien and security
interest in the pledged residential loans upon which the warehouse
financing was to be extended; the chattel paper and other loan
documentation evidencing those loans; and all proceeds, accessions
or other rights related to the loans.

JPMorgan has asserted that as of the Debtors' bankruptcy filing,
the outstanding principal balance under the Warehouse Facility
totaled $160,000,000, excluding interest, fees and other charges.  
JPMorgan has declared a default under the facility.

JPMorgan has also asserted that the Warehouse Facility Collateral
include residential loans supporting the construction or
improvement of single-family homes which convert to regular
mortgage loans once the home is built or the improvements
completed.  JPMorgan has asserted that as of the Petition Date,
there are:

   (a) 15 Construction and Permanent Loans constituting Warehouse
       Facility Collateral;

   (b) the maximum dollar amount that would be required to be
       advanced on account of the Construction and Permanent
       Loans is $24,742,143; and

   (c) JPMorgan has advanced $16,637,823, leaving a maximum of
       $8,104,320 that could be advanced in connection with the
       Construction and Permanent Loans.

On August 5, 2007, JPMorgan notified the Debtors that it intended
to fund up to $8,104,320 in additional draws required under the
Construction and Permanent Loans to complete the construction or
repair of the residential properties, and otherwise protect and
preserve the collateral securing the Loans.

In a stipulation approved by the U.S. Bankruptcy Court for the
District of Delaware, the Debtors and JPMorgan agree that any
funds transferred to American Home Mortgage Servicing Inc. will
be held in trust for the benefit of the bank and the borrowers
under the Commercial and Permanent Loans.  AHM Servicing will
disburse the funds solely to complete construction or repair of
the properties.

The parties agree that the trust funds will not become "property
of the estate" as the term is defined in Section 541 of the
Bankruptcy Code.  The funding will not constitute a loan, advance
or extension of credit to AHM Servicing, and none of the trust
funds will be used as collateral for any other outstanding or
future debt facility other than the JPMorgan Warehouse Facility.

Unused funds will be returned to JPMorgan.  The trust funds will
not accrue postpetition interest solely as a result of the funds
having been advanced after the Petition Date.

The Stipulation is without prejudice to the rights of JPMorgan
and the Debtors with respect to the Warehouse Facility
Collateral.

JPMorgan is represented in the Debtors' cases by Adam G. Landis,
Esq., and Matthew B. McGuire, Esq., at Landis Roth & Cobb LLP, in
Wilmington, Delaware; and Thomas H. Grace, Esq., and W. Stephen
Bryant, Esq., at Locke Liddell & Sapp Pllc, in Houston, Texas.

Based in Melville, New York, American Home Mortgage Investment
Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage    
real estate investment trust engaged in the business of investing
in mortgage-backed securities and mortgage loans resulting from
the securitization of residential mortgage loans originated and
serviced by its subsidiaries.  

American Home Mortgage and seven affiliates filed for chapter 11
protection on August 6, 2007 (Bankr. D. Del. Case Nos. 07-11047
through 07-11054).  James L. Patton, Jr., Esq., Joel A. Waite,
Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt &
Taylor LLP are the proposed counsel to the Debtors.  Epiq
Bankruptcy Solutions LLC is the proposed claims and noticing
agent.  The Official Committee of Unsecured Creditors has
selected Hahn & Hessen LLP as its counsel.  As of March 31, 2007,
American Home Mortgage's balance sheet showed total assets of
$20,553,935,000, total liabilities of $19,330,191,000, and
total stockholders' equity of $1,223,744,000.  The Debtors'
exclusive period to file a plan expires on Dec. 4, 2007.
(American Home Bankruptcy News, Issue No. 3, Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


AMERICREDIT CORP: Extends $500 Million Repurchase Facility
----------------------------------------------------------
AMERICREDIT CORP. extended its $500 million repurchase facility
structured by Barclays Capital.  

AmeriCredit uses this facility to finance the repurchase of
receivables from securitization transactions that have reached the
10% clean-up call.  

This facility, which matures in August 2008, provides for improved
advance rates on upcoming borrowings based on the cumulative net
losses of securitizations when called.

AmeriCredit has total available warehouse commitments of
$5.35 billion, of which $4.15 billion have maturities subsequent
to June 2008.

Based in Fort Worth, Texas, AmeriCredit Corp. (NYSE:ACF) --
http://www.americredit.com/-- is an independent automobile   
finance company that provides financing solutions indirectly
through auto dealers and directly to consumers in the United
States and Canada.  AmeriCredit was founded in 1992 and has over
one million customers and approximately $15 billion in managed
auto receivables.  

                         *     *     *

As reported in the Troubled Company Reporter on June 20, 2007,
Moody's Investors Service issued a rating of 'Ba3' to AmeriCredit
Corp.'s $200 million issue of senior unsecured notes.  The rating
outlook is stable.


AMPHENOL CORP: Moody's Withdraws Ba1 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service assigned an Issuer Rating of Baa3 to
Amphenol Corporation, concluding a review for possible upgrade
initiated on July 23, 2007.

Concurrent with this action, Moody's is withdrawing the Corporate
Family Rating of Ba1.  The outlook is stable.

The assignment of the Issuer Rating at Baa3 reflects the continued
strong financial performance of the company, which has been
characterized by strong cash flow generation capabilities and
sound interest coverage.  Adding additional support to the ratings
are the company's solid liquidity profile, the scale of its
operations as well as its leading market positions in both the
connector and cabling businesses.

Factors constraining the Baa3 rating are the company's significant
concentration in sales in the communications, military and
commercial aerospace sectors as well as an underfunded defined
benefit pension plan.

The stable ratings outlook reflects Moody's belief that Amphenol
will continue to maintain strong top-line revenue growth, industry
leading margins, sound cost-cutting discipline as well as a strong
new product development focus.  The rating agency also expects the
company to maintain a measured approach to acquisitions that will
enable it to expand its product offering, improve its margins and
enlarge its global footprint while preserving the strength of its
balance sheet and the robustness of its cash flow.

Moody's withdrew these ratings:

-- Speculative Grade Liquidity Rating, SGL-1;
-- Corporate Family Rating, Ba1

The outlook is stable.

Amphenol Corporation is one of the world's largest designers,
manufacturers and marketers of electrical, electronic and fiber
optic connectors, interconnect systems and coaxial and flat-ribbon
cable.  For the twelve months ended June 30, 2007, the company
reported revenues of about $2.6 billion.


ANDREW CORP: Obtains Info Requests on CommScope's Purchase Deal
---------------------------------------------------------------
Andrew Corporation and CommScope Inc. have received requests for
additional information from the Antitrust Division of the U.S.
Department of Justice regarding CommScope's pending acquisition of
Andrew.

The information requests were issued under the notification
requirements of the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.
    
The second request extend the waiting period imposed by the HSR
Act until 30 days after Andrew and CommScope have substantially
complied with the second requests, unless that period is extended
voluntarily by the parties or terminated sooner by the DOJ.

Andrew and CommScope intend to cooperate fully with the DOJ.  The
companies expects to close the transaction before the end of 2007.
    
The transaction remains subject to completion of other customary
closing conditions, including effectiveness of a registration
statement on Form S-4, approval by Andrew's stockholders, and
other international regulatory approvals.

                       About CommScope Inc.

Based in Hickory, North Carolina, CommScope Inc. (NYSE:CTV) --
http://www.commscope.com/-- designs and manufactures "last    
mile" cable and connectivity solutions for communication
networks.  Through its SYSTIMAX(R) Solutions(TM) and Uniprise(R)
Solutions brands CommScope is the global leader in structured
cabling systems for business enterprise applications.  It is
also the world's largest manufacturer of coaxial cable for
Hybrid Fiber Coaxial applications. Backed by strong research and
development, CommScope combines technical expertise and
proprietary technology with global manufacturing capability to
provide customers with high-performance wired or wireless
cabling solutions.  CommScope has facilities in Brazil, Australia,
China and Ireland.

                        About Andrew Corp.

Headquartered in Westchester, Illinois, Andrew Corporation
(NASDAQ: ANDW) -- http://www.andrew.com/-- designs, manufactures
and delivers innovative and essential equipment and solutions for
the global communications infrastructure market.  The company
serves operators and original equipment manufacturers from
facilities in 35 countries.

                          *     *     *

As reported in the Troubled Company Reporter on June 29, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Andrew Corp. to 'BB-' from 'BB' and placed the rating on
CreditWatch with negative implications, following announcement
of the merger.


ARAMARK CORP: 8.5% Sr. Notes Offer Set to Expire on Wednesday
-------------------------------------------------------------
ARAMARK Corporation extended the expiration date of its offer to
exchange up to $1,280,000,000 in aggregate principal amount of its
registered 8.5% senior notes due 2015 and up to $500,000,000 in
aggregate principal amount of its registered senior floating rate
notes due 2015 for its outstanding unregistered 8.5% senior notes
due 2015 and outstanding unregistered senior floating rate notes
due 2015.

The exchange offer was originally scheduled to expire at 5:00 p.m.
(Eastern Standard Time) on Thursday, Aug. 16, 2007, but will now
expire at 5:00 p.m. (Eastern Standard Time) on Wednesday, Aug. 22,
2007.

As of the close of business on Thursday, $1,277,700,000 in
aggregate principal amount of outstanding unregistered 8.5% senior
notes due 2015 and $489,839,000 in aggregate principal amount of
outstanding unregistered senior floating rate notes due 2015 had
been validly tendered to the exchange agent by the holders of the
notes.

The exchange agent for the exchange offer is:

                    The Bank of New York
                    Reorganization Unit
                    Attn: Carolle Montreuil
                    101 Barclay Street, 7E
                    New York, New York 10286

Headquartered in Philadelphia, Pennsylvania, ARAMARK Corporation
(NYSE:RMK) -- http://www.aramark.com/-- is a leader in
professional services, providing award-winning food services,
facilities management, and uniform and career apparel to health
care institutions, universities and school districts, stadiums
and arenas, and businesses around the world.  In FORTUNE
magazine's 2006 list of "America's Most Admired Companies,"
ARAMARK was ranked number one in its industry, consistently
ranking since 1998 as one of the top three most admired
companies in its industry as evaluated by peers and industry
analysts.  The company was also ranked first in its industry in
the 2006 FORTUNE 500 survey. ARAMARK has approximately 240,000
employees serving clients in 20 countries, including Japan and
Korea.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 16, 2007,
Standard & Poor's Ratings Services revised its outlook on
ARAMARK Corporation to stable from negative.  At the same time,
Standard & Poor's affirmed its ratings on ARAMARK, including the
'B+' corporate credit rating.


ASSET SECURITIZATION: Moody's Affirms "C" Class A-4 Cert. Rating
----------------------------------------------------------------
Moody's Investors Service upgraded the rating of one class and
affirmed the ratings of two classes of Asset Securitization
Corporation, Commercial Mortgage Pass-Through Certificates, Series
1997-MD VII as:

-- Class PS-1, Notional, affirmed at Aaa
-- Class A-3, $26,743,716, upgraded to Aaa from Baa1
-- Class A-4, $5,715,763, affirmed at C

As of the Aug. 15, 2007 distribution date, the transaction's
outstanding certificate balance has decreased by about 93.5% to
$32.5 million from $499.6 million at securitization.  Six loans
have paid off since securitization and the Certificates are now
solely collateralized by the Innkeepers II Loan.  Moody's is
upgrading Class A-3 due to the borrower's election on June 29,
2007 to defease the loan with U.S. Government securities.  The
borrower has elected to prepay the loan on the optional prepayment
date of March 11, 2009, as provided for in the loan documents.
Class A-4 has sustained a significant loss due to loan
liquidations and now represents the transaction's first loss
position.


BALLY TOTAL: Noteholders Back Amendment of Reorganization Plan
--------------------------------------------------------------
Bally Total Fitness reported that holders of more than 55% of its
10-1/2% Senior Notes due 2011 have, subject to the modifications
to the treatment of the Senior Notes, agreed to support the
proposed modifications to Bally's Joint Prepackaged Chapter 11
Plan of Reorganization necessary to implement a superior
restructuring proposal from Harbinger Capital Partners Master Fund
I Ltd. and Harbinger Capital Partners Special Situations Fund L.P.  

In addition, holders of more than 80% of its 9-7/8% Senior
Subordinated Notes due 2007, which include affiliates of
Tennenbaum Capital Partners, LLC, Goldman, Sachs & Co. and
Anschutz Investment Company, subject to bankruptcy court approval,
have agreed to support the Amended Plan.
    
To facilitate the consensual implementation of the Amended Plan,
Bally, Harbinger and these consenting Senior Noteholders and
Subordinated Noteholders have entered into a new restructuring
support agreement that binds all of these major stakeholders to
support the Amended Plan.

In addition, Harbinger has signed the investment agreement that
provides for its $233.6 million equity investment in reorganized
Bally.  This investment agreement and the restructuring support
agreement will each become effective upon bankruptcy court
approval, which Bally is seeking at a hearing scheduled for
Aug. 21, 2007.
    
Under its proposal Harbinger would invest approximately
$233.6 million in exchange for 100% of the common equity of
reorganized Bally.  The Harbinger Proposal under the Amended Plan
would provide equal or better treatment to all holders of
unsecured claims against Bally, including the Senior and
Subordinated Noteholders.

Specifically:
    
   -- The annual interest rate payable under the Senior Notes
      would be increased to 13% from 12-3/8% in the Existing Plan,
      with corresponding increases in the premiums payable for
      early redemption.  Senior Noteholders would otherwise
      receive the same treatment as provided in the Existing Plan.

   -- Subordinated Noteholders would receive an immediate cash
      payment of $123.5 million in the aggregate, with the
      remaining balance of the Subordinated Notes to be satisfied
      through the issuance of approximately $200 million in new
      subordinated notes of reorganized Bally.  The annual
      interest rate payable under the new subordinated notes would
      be increased by 200 basis points to 15 5/8% as the payment-
      in-kind interest rate and 14% as the cash pay interest rate.
      Subordinated Noteholders would otherwise receive the same
      treatment as provided in the Existing Plan. Under the
      Existing Plan, Subordinated Noteholders would not receive
      any cash payments.

   -- Holders of all other unsecured claims would receive full
      payment in cash, in some cases over time with interest.

   -- Holders of Bally's existing common stock and certain other
      claims treated as equity in bankruptcy would receive $16.5
      million in the aggregate.  Under the Existing Plan, existing
      common stockholders would receive no distribution.
    
Bally filed a motion with the Bankruptcy Court for the Southern
District of New York seeking approval to amend the Existing Plan
in the form of the Amended Plan in order to implement the
Harbinger-funded restructuring without the need to resolicit votes
from Bally's creditors.

Bally will now seek approval of that motion based on the
Amended Plan as modified to incorporate the revised Senior Note
treatment described above.  Bally will also seek the Court's
approval of the new restructuring support agreement that has been
signed by Bally, Harbinger, the consenting Subordinated
Noteholders and the consenting Senior Noteholders.
    
“We are confident in the company and are pleased to have the
support of these Senior and Subordinated Noteholders for the
restructuring proposal,” Howard Kagan, Managing director &
director of investments of Harbinger Capital Partners, said.  

“Additionally, we look forward to Bally presenting the
Amended Plan to the Bankruptcy Court next week and to moving
forward with the restructuring process with an eye towards a quick
emergence from Chapter 11,” Mr. Kagan said.
    
“Harbinger presented a superior proposal and Bally did a
remarkable job bringing the parties together,” Michael E.
Tennenbaum, senior managing partner of Tennenbaum Capital
Partners LLC, Said.  “We wish them all great success.”
    
“We appreciate the overwhelming support of our noteholders for our
amended plan of reorganization and will seek to execute it and
emerge promptly from Chapter 11 protection,” Don R. Kornstein,
interim chairman and chief restructuring officer of Bally Total
Fitness, said.  

“We are also grateful for the confidence that Harbinger has
expressed in Bally through its extraordinary investment and look
forward to partnering with Harbinger to enhance our capital
structure, strengthen our balance sheet and make the capital
investments necessary to meet the needs of our members
while improving our operating performance,” Mr. Kornstein added.
    
Under the amended plan the company can still consummate the
restructuring set forth in the Existing Plan if the Harbinger-
funded restructuring cannot be consummated. In that case, the
Subordinated Noteholders referenced above would backstop a $90
million rights offering of new senior subordinated notes.
    
                     About Bally Total Fitness

Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates
fitness centers in the U.S., with over 375 facilities located in
26 states, Mexico, Canada, Korea, China and the Caribbean under
the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports Clubs
of Canada (R) brands.  

Bally Total and its affiliates filed for chapter 11 protection
on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after
obtaining requisite number of votes in favor of their pre-packaged
chapter 11 plan.  Joseph Furst, III, Esq. at Latham & Watkins,
L.L.P. represents the Debtors in their restructuring efforts.
As of June 30, 2007, the Debtors had $408,546,205 in total assets
and $1,825,941,54627 in total liabilities.  

No schedule has been set to date for an organizational meeting
that would create an Official Committee of Unsecured Creditors.
The Court recently held that the meeting of creditors pursuant to
Section 341(a) of the Bankruptcy Code will not be convened, and
is canceled, if the Debtors' Plan of Reorganization is confirmed
on or prior to October 16, 2007.


BANK OF QUEENSLAND: Moody's Affirms "C" Financial Strength Rating
-----------------------------------------------------------------
Moody's Investors Service affirmed Bank of Queensland's ratings of
A2 / Prime-1 for deposits and other senior obligations, and its
bank financial strength rating of C.  The affirmation follows the
bank's announcement of an offer for the Mackay Permanent Building
Society.  The ratings remain on Stable Outlook.

"The merger would expand Bank of Queensland's presence in central
and northern Queensland, by adding an additional 12 branches and
14 agencies.  However the scale of the acquisition remains small
relative to the bank", said Patrick Winsbury, a Senior Vice
President with Moody's Sydney office.

The merger proposal would allow Mackay Permanent Building Society
shareholders to choose to receive either cash or scrip.  Even
assuming that shareholders choose to receive cash, the impact on
Bank of Queensland's financial profile would remain well contained
due to the small size of Mackay Permanent Building Society.

Bank of Queensland is headquartered in Brisbane, Queensland,
Australia.  It reported assets of AUD15.8 billion (about
$12.1 billion) at financial year end 2006.

Mackay Permanent Building Society is headquartered in Mackay,
Queensland, Australia.  It reported assets of AUD371 million
(about $313 million) at 1H 2007.


BARMA FOODS: Case Summary & 22 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Barma Foods, Inc.
        dba Productos Oscar
        Urb. Industrial Minillas
        325 Calle D, Suite 7
        Bayamon, PR 00959-1906

Bankruptcy Case No.: 07-04583

Type of business: The Debtor is a food manufacturer.

Chapter 11 Petition Date:

Court: District of Puerto Rico (Old San Juan)

Debtor's Counsel: Carmen D. Conde Torres, Esq.
                  254 San Jose Street
                  5th Floor
                  San Juan, PR 00901-1523
                  Tel: (787) 729-2900
                  Fax: (787) 729-2203

Estimated Assets:     $100,000 to $500,000

Estimated Debts: $1 Million to $10 Million

Debtor's 22 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Pridco                                                    $98,496
P.O. Box 362350
San Juan, PR
00936-2350

B.P.P.R.                                                  $35,000
P.O. Box 362708
San Juna, PR
00936

Alco High Tech                                            $26,762
Plastic
P.M. Box 2028
Corozal, PR
00783

Ochoa                                                     $22,821

Miguel Santiago                                           $20,318

Helapan, Inc.                                             $15,945

Chesso, Inc.                                              $15,256

Provisiones Legrand                                       $12,766
Merc. Central

Dawn Food International                                    $9,492

Dawn Food International                                    $9,492

Autoridad de Energia                                       $7,816
Electrica

J.C. Cheese Caribe Corp.                                   $6,000

Caribe Carton, Inc.                                        $5,780

Comidas Criollas Elizabeth                                 $4,478

Smurfit-Stone P.R., Inc.                                   $4,274

Empresas Barsan, Inc.                                      $4,012

Belca Wholesale Centro                                     $3,960
Mercantil International

Suarez, Fermin                                             $3,955

Agramar Corp.                                              $3,732

Isla Food Meat, Inc.                                       $3,300

Mark Trece de Puerto Rico                                  $3,175


BARNERT MEMORIAL: Case Summary & 38 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Nathan and Miriam Barnert Memorial Hospital Association
        680 Broadway
        Paterson, NJ 07514

Bankruptcy Case No.: 07-21631

Type of Business: The Debtor operates a hospital and
                  medical center.

Chapter 11 Petition Date: August 15, 2007

Court: District of New Jersey (Newark)

Judge: Donald H. Steckroth

Debtor's Counsel: David J. Adler, Esq.
                  McCarter & English, LLP
                  Four Gateway Center
                  100 Mulberry Street
                  Newark, NJ 07102
                  Tel: (973) 622-4444
                  Fax: (973) 624-7070

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's List of its 38 Largest Unsecured Creditors:

   Entity                        Nature of Claim      Claim Amount
   ------                        ---------------      ------------
Public Service Electric and Gas  Utility                $1,470,771
c/o Bob Lowery
P.O. Box 490
Cranford, NJ 07016

Armanti Financial Services       Trade Debt             $1,009,191
2 Broad Street
Bloomfield, NJ 07003

Sodexho, Inc. & affiliates       Trade Debt               $628,616
P.O. Box 81049
Woburn, MA 01813-1049

UMDNJ                            Trade Debt               $576,309
Cashier Office
P.O. Box 2685
New Brunswick, NJ 08903-2685

Aramark CTS Inc.                 Trade Debt               $575,334
12483 Collections Center Drive
Chicago, IL 60693

ACSA Group Insurance             Trade Debt               $452,501
P.O. Box 30422
Hartford, CT 06150

Phoenix Healthcare Inc.          Trade Debt               $442,828
560 Sylvan Avenue
Englewood Cliffs, NJ 07632

Paterson Emergency               Trade Debt               $337,158
Physicians, P.C.
484 Temple Hill Road
Suite 102
New Windsor, NY 12553

G.E. Healthcare Finance          Trade Debt               $314,519
Services
P.O. Box 641419
Pittsburgh, PA 15264-1419

Emergency Medical Consultants    Trade Debt               $300,230
651 Est Mt. Pleasant Avenue
Livingston, NJ 07039

Cardinal Health Medical          Trade Debt               $292,380
Products and Services
P.O. Box 13862
Newark, NJ 07188-0862

Insight Health Corp.             Trade Debt               $285,949
P.O. Box 847689
Dallas, TX 75284-7689

Olympus America, Inc.            Trade Debt               $264,341
Olympus Financial Services
c/o  T.J. Spencer
P.O. Box 200183
Pittsburgh, PA 15251-0194

Caligor Medical and              Trade Debt               $259,554
Office Supply Co.
846 Pelham Parkway
Pelham Manor, NY 10803

Onward Healthcare                Trade Debt               $252,689
P.O. Box 27421
New York, NY 10087-7421

Nuclear Diagnostic Products      Trade Debt               $245,478

MCI                              Utility                  $242,131

Verizon                          Utility                  $220,015

Beckman Coulter Inc.             Trade Debt               $193,139

Passaic Hospital                 Trade Debt               $180,000
Physicians P.A.

Medical Information              Trade Debt               $173,172
Technology, Inc.

Besler & Company, Inc.           Trade Debt               $162,014

Navix Diagnostix, Inc.           Trade Debt               $152,149

Barnert Anesthesia               Trade Debt               $150,000

County Wide Anesthesia           Trade Debt               $142,228
Group LLC

State of N.J. Dept. of Labor     Taxes                    $141,703

Accent Insurance                                          $141,061
Recovery Solutions

Bergen Community Regional        Trade Debt               $127,424
Blood Center

Nurses 24/7                      Trade Debt               $122,624

O'Grady-Peyton International     Trade Debt               $120,749

Nationwide Life Insurance        Trade Debt               $103,158

AON                                                       $102,685

Bio Medical Applications Inc.    Trade Debt                $96,500

Professional Services            Trade Debt                $94,256

Baxter Healthcare Corp.          Trade Debt                $89,866

Passaic Valley Water Commission  Trade Debt                $88,845

Ortho Clinical Diagnostics       Trade Debt                $88,628

Carrier Corporation              Trade Debt                $86,734

Candor Construction Group Inc.   Trade Debt                $39,515


BEKINS QUARTER: Case Summary & 11 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Bekins Quarter Circle 41 Ranch, L.L.C.
        P.O. Box 584
        Buffalo, WY 82834

Bankruptcy Case No.: 07-20501

Type of business: The Debtor is engaged in the ranching business.

Chapter 11 Petition Date: August 15, 2007

Court: District of Wyoming (Cheyenne)

Judge: Peter J. McNiff

Debtor's Counsel: Paul Hunter, Esq.
                  2616 Central Avenue
                  Cheyenne, WY 82001
                  Tel: (307) 637-0212

Total Assets: $5,576,800

Total Debts:  $3,720,840

Debtor's 11 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Sheridan Implement                                        $42,528
2945 West 5th Street
Sheridan, WY 82717

Wishbone Fencing                                          $22,225
P.O. Box 3055
Aladdin, WY 82710

I.C.M.                                                    $17,000
P.O. Box 2469
Gillette, WY 82717

Eds Auto Shop                                              $8,000

Mullinax                                                   $6,890

Big Horn Petroleum                                         $6,682

Presfeldt                                                  $6,000

Kirven and Kirven                                          $3,500

Borgialli Ranch                                            $2,500

Jims Auto                                                  $1,334

N.A.P.A.                                                     $824

M.T.-Dakota                                                  $810

Bloedorn                                                     $244


BELL MICROPRODUCTS: Obtains Add'l Nasdaq Determination Notice
-------------------------------------------------------------
Bell Microproducts Inc. has received an additional staff
determination notice from the Nasdaq Stock Market, stating
that it is not in compliance with the requirements for continued
listing pursuant to Nasdaq Marketplace Rule 4310(c)(14), due to
its failure to file on a timely basis its Quarterly Report on Form
10-Q for the quarter ended June 30, 2007.

This staff determination notice serves as an additional basis for
delisting the company's common stock from trading on Nasdaq.  As a
result, the company's securities remain subject to delisting from
trading on the Nasdaq Global Market.
    
Nasdaq initially informed the company in November 2006, that it
was not in compliance with continued listing standards due to the
company's delay in filing its Quarterly Report on Form 10-Q for
the period ended Sept. 30, 2006.

The company's appeal before the Nasdaq Listing and Hearing Review
Council remains pending and any decision of the Nasdaq Listing
Qualifications Panel to delist the company has been stayed.

On June 29, 2007, and August 13, 2007, the company submitted
additional information to Nasdaq in support of its position.  The
staff determination notice includes a request for additional
information due no later than Aug. 21, 2007.  The company expects
to be able to comply with this additional request in a timely
manner.
    
                    About Bell Microproducts

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

                         *     *     *

For the quarter ended June 30, 2007, the company provided
additional information to NASDAQ to support its request for an
extension of time required to complete its required filings with
the SEC.  During the quarter the company also received waivers
from its lenders through Sept. 30, 2007, relating to the filing of
financial reports with the SEC and the provision of audited
financial reports to the lenders.


BOSTON SCIENTIFIC: Mulls Sale of Cardiac & Vascular Surgery Units
-----------------------------------------------------------------
Boston Scientific Corporation intends to explore the sale of its
Cardiac Surgery and Vascular Surgery businesses as part of the
company's plan to review its portfolio of assets and divest those
considered non-strategic, and to strengthen its operating and
financial performance.

"As part of an ongoing review of our assets, we have initiated a
process to explore the sale of our Cardiac Surgery and Vascular
Surgery businesses," Paul LaViolette, Chief Operating Officer of
Boston Scientific, said.  "If finalized, this sale will support
our efforts to focus resources on our core businesses and improve
our operating and financial performance.  These are strong
businesses, and we believe the combined portfolio has great
potential for success with the focused attention and resources of
external ownership.  We are in discussions with several potential
buyers, and we expect the process to take a number of months."

"This is another step in the progress we are making on our plan to
divest non-strategic assets, monetize our investment portfolio and
bring our expenses and head count in line with our revenues," Mr.
LaViolette added.  "We have now identified three non-strategic
businesses to divest, and we are in discussions with potential
buyers for all three.  In recent months we have retained our
Endosurgery group, entered into an agreement to assume sole
management and control of our pain management business from
Advanced Bionics and sell the Advanced Bionics auditory business,
monetized parts of our portfolio, and begun developing an expense
and head count reduction plan, which we plan to announce next
quarter.  In addition, we continue to focus on the recovery of the
drug-eluting stent and cardiac rhythm management markets.  
Together, these measures should combine to help us achieve our
overall goals of restoring profitable growth, increasing
shareholder value, and continuing to build and strengthen Boston
Scientific."

Boston Scientific acquired the Cardiac Surgery business in April
2006 as part of the Guidant transaction.  Headquartered in San
Jose with a manufacturing facility in Dorado, Puerto Rico, the
Cardiac Surgery business is a leading developer of medical
technologies designed to provide less-invasive therapies in
cardiac surgery, including beating heart bypass surgery systems,
endoscopic vessel harvesting for coronary bypass surgery, and
microwave surgical ablation.  The business employs approximately
450 people and had 2006 revenues of $189 million.

Boston Scientific established its Vascular Surgery business with
the acquisition of Meadox Medicals in 1995.  The Vascular Surgery
business develops market-leading synthetic grafts and patches for
repair of abdominal aortic aneurysms and peripheral vascular
anatomy.  The business had 2006 revenues of $86 million and has
approximately 250 employees, primarily located at its
manufacturing site in Wayne, New Jersey.

                     About Boston Scientific

Headquartered in Natick, Massachusetts, Boston Scientific
Corporation (NYSE: BSX) -- http://www.bostonscientific.com/--     
develops, manufactures and markets medical devices used in a
broad range of interventional medical specialties.  The company
has offices in Argentina, Chile, France, Germany, and Japan,
among others.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 7, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Boston Scientific Corp. to 'BB+' from 'BBB-' and
placed the ratings on the company on CreditWatch with negative
implications.  S&P has withdrawn the commercial paper rating at
the company's request.

At the same time, Fitch Ratings downgraded the ratings on Boston
Scientific Corp. including the company's 'BBB-' Senior Unsecured
Notes rating which was lowered to 'BB+'.  The Rating Outlook is
Negative.


BROADCAST INT'L: June 30 Balance Sheet Upside-Down by $3.7 Million
------------------------------------------------------------------
Broadcast International Inc.'s consolidated balance sheet at June
30, 2007, showed $3.5 million in total assets and $7.2 million in
total liabilities, resulting in a $3.7 million total stockholders'
deficit.

The company's consolidated balance sheet at June 30, 2007, also
showed strained liquidity with $2.8 million in total current
assets available to pay $6.3 million in total current liabilities.

The company reported a net loss of $1.2 million for the second
quarter ended June 30, 2007, compared with a net loss of $483,699
for the same period last year.

The company generated $763,784 in revenue during the three months
ended June 30, 2007, compared with revenue of $4.3 million during
the comparable period in 2006.  The decrease in revenue of
approximately $3.5 million was due primarily to approximately
$3.0 million less non-recurring installation work for a single
customer.  In addition, in the three months ended June 30, 2007,
revenues from satellite fees declined $122,824, revenues from
studio and production services declined $45,863 and revenues from
license fees declined $13,463.

The increase in the net loss of $736,100 is primarily due to an  
expense recorded for the impairment of a software license of
$1.1 million, a decrease in gross margin of $320,760 due to lower
revenues, and increased operating and other expenses other than
the impairment of license rights of $190,461, all of which was
offset by an increase in the derivative valuation gain of  
embedded derivatives of $495,980 and a decrease in interest
expense of $418,563.

For the three months ended June 30, 2007, the company incurred
interest expense of $353,008 compared to interest expense for the
three months ended June 30, 2006, of $771,571.  The decrease of
$418,563 resulted from recording less interest expense related to
the senior secured convertible notes and debt offering costs above
what was recorded for the three months ended June 30, 2006.  s.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?229f

                       Going Concern Doubt

HJ & Associates LLC, in Salt Lake City, expressed substantial
doubt about Broadcast International Inc.'s ability to continue as
a going concern after auditing the company's consolidated
financial statements for the years ended June 30, 2007.  The
auditing firm pointed to the company's operating losses and lack
of working capital.

                  About Broadcast International

Headquartered in Salt Lake City, Broadcast International Inc.
(OTC: BCST) -- http://www.brin.com/-- provides video-powered  
business solutions, including IP and digital satellite, Internet
streaming, and other types of wired/wireless network distribution.  
In addition, BI assists clients with video production, rich media
development and a full range of network support services.  BI also
possesses a patented technology, CodecSys, which provides enhanced
video at current bandwidths or reduces the cost of bandwidth while
maintaining quality.


CARDSYSTEMS SOLUTIONS: Court Set to Confirm Plan on Sept. 13
------------------------------------------------------------
The Honorable James M. Marlar of the United States Bankruptcy
Court for the District of Arizona will convene a hearing on
Sept. 13, 2007, 10:30 a.m., at 38 S. Scott Avenue, Courtroom 446,
to consider confirmation of Cardsystems Solutions Inc.'s Chapter
11 Plan of Liquidation.

On Aug. 9, 2007, Judge Marlar approved the Third Amended
Disclosure Statement explaining the Debtor's Plan.

                       Overview of the Plan

Under the Plan, the Debtor's cash on hand will be used to pay
all creditors.  If the Debtor's cash on hand is insufficient, the
escrowed cash may be transfered to the Debtor from the escrow
account by JPMorgan Chase Bank N.A.

On the effective date of the Plan, Edward B. Berger will be
appointed as the liquidating agent, to oversee the operation and
management of the Debtor.  As the Debtor's liquidating agent, Mr.
Berger will, specifically:

   i. control and manage the property of the estate, including
      taking any action necessary to sell assets and collect
      proceeds;

  ii. distribute estate assets in accordance with the terms of
      the Plan; and

iii. file with the Court a report at the conclusion of the
      administration of the estate assets showing all assets and
      income administered and disbursed.

                       Treatment of Claims

Under the Plan, Administrative Claims will be paid in full, in
cash after the effective date.

Priority Tax and Priority Wage Claims will be paid an amount equal
to one-half of any allowed claims.

Equity Interest holders, if any, will also be paid on a pro rata
basis, according to the holders contractual priority.

                   Merrick Treatment of Claim

Merrick Bank's secured claim will receive a cash distribution on
the effective date.  The Merrick's claim will be funded from the
deposit and the escrow account, which will be transfered directly
to Merrick by JPMorgan Chase.

In addition, Merrick's recovery will be limited to $14,750,000.  
Funding for the payment of the first $10 million will be:

    a. $5.1 million -- the Debtor will release all claims
       to the deposit;

    b. $1,216,195 -- the Debtor will release all claims to
       the escrow release;

    c. $5,183,805 -- the remaining cash of $5,183,805 will
       be disbursed from the account to Merrick.

Funding for the payment of the remaining principal amount of
$4,750,000 will be:

    a. Merrick agrees to transfer $1,500,000, plus other
       interest, from the escrow acount to the estate for the
       benefit of the General Unsecured creditors, in turn,  
       Merrick will have an  allowed claim of $1,250,000.

    b. Merrick will have first priority on the first
       $3.5 million of net distribution of proceeds of estate
       assets.

    c. Merrick will be entitled to cause the liquidation of as
       many of the escrowed shares held by the estate as is
       necessary to yield a net return to Merrick in an amount
       that the sum of the Merrick trust recoveries and the
       Merrick Stock Recoveries equals $3.5 million, on third
       anniversary of the effective date.

A full-text copy of Cardsystems' Third Disclosure Statement is
available for a fee at:

   http://www.researcharchives.com/bin/download?id=070818021736

A full-text copy of Cardsystems' Third Plan of Liquidation is
available for a fee at:

   http://www.researcharchives.com/bin/download?id=070818021539

Headquartered in Sonoita, Arizona, Cardsystems Solutions Inc. --
http://www.cardsystems.com/-- was acquired by Pay By Touch  
Payment Solutions, LLC -- http://www.paybytouch.com/-- a      
biometric authentication, loyalty, membership, payment and other
electronic transaction solutions provider.  The Company filed for
bankruptcy protection on May 12, 2006 (Bankr. D. Ariz. Case No.
06-00515).  Frederick J. Petersen, Esq., Michael McGrath, Esq.,
and Lowell Rothschild, Esq., at Mesch, Clark & Rothschild, P.C.,
represent the Debtor in its restructuring efforts.  No Official
Committee of Unsecured Creditors has been appointed in the
Debtor's case.  When the Debtor filed for bankruptcy protection,
it disclosed assets amounting to $13,087,515 and debts totaling
$23,860,343.


CDO OF ABS: S&P Lowers Ratings on 50 Tranches from 12 Transactions
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 50
tranches from 12 U.S. cash flow and hybrid CDO of ABS
transactions.  Forty-seven of these ratings had been on
CreditWatch with negative implications before the downgrades; S&P
removed the ratings assigned to these tranches from CreditWatch.  
The rating on an additional class from one of these transactions
remains on CreditWatch with negative implications.  In addition,
S&P affirmed its ratings on another 19 tranches from six CDO of
ABS transactions and removed them from CreditWatch with negative
implications.  The 50 downgraded tranches represent an issuance
amount of $2.312 billion; the 19 tranches with ratings affirmed at
their current levels and removed from CreditWatch negative
represent an issuance amount of $692.6 million.
     
All of the affected CDO transactions are collateralized in part by
mezzanine tranches of U.S. residential mortgage-backed securities
backed by first-lien subprime mortgage collateral.  On July 12,
2007, Standard & Poor's lowered its ratings on more than 600 U.S.
RMBS classes collateralized by U.S. first-lien subprime mortgages.  
Subsequently, on July 19, 2007, S&P lowered its ratings on more
than 400 U.S. RMBS classes backed by U.S. closed-end second-lien
mortgages; and on Aug. 7, 2007, S&P placed its ratings on more
than 200 RMBS classes backed by U.S. first-lien Alternative-A
mortgage collateral on CreditWatch negative.  In light of these
actions, S&P have reviewed the exposure of its globally rated CDO
transactions to the downgraded securities and are continuing to
assess the impact of this exposure on its CDO ratings.
     
Including the CDO tranches listed below, S&P have lowered its
ratings on 75 tranches from 18 cash flow and hybrid CDO
transactions to date as a result of exposure to RMBS securities
that have seen negative credit migration, and another 127 tranche
ratings from 41 cash flow and hybrid CDO transactions are
currently on CreditWatch negative.  The 75 downgraded tranches
represent an issuance amount of $3.29 billion; the 127 tranches
with ratings on CreditWatch negative represent an issuance amount
of $3.642 billion.
     
Aside from these actions on cash flow and hybrid CDOs, Standard &
Poor's has also lowered 96 tranche ratings from 77 non-excess-
spread synthetic CDO transactions and placed 10 tranche ratings
from four actively managed non-excess-spread synthetic CDO
transactions on CreditWatch with negative implications.  The 96
downgraded synthetic CDO tranches represent $2.101 billion in
issuance; the 10 synthetic CDO tranches with ratings on
CreditWatch represent $210.8 million in issuance.
     

Ratings Lowered

                                                   Rating
                                                   ------
      Transaction                  Class        To       From
      -----------                  -----        --       ----
      Arca Funding 2006-II Ltd.    VII          BB-      BB+
      Octans III CDO Ltd.          D            BB       BB+
      Orion 2006-2 Ltd.            X            BB       BBB-

Ratings Lowered and Removed from Creditwatch Negative

                                        Rating
                                        ------
     Transaction                  Class      To       From
     ----------                   ----       --       ----
     ACA ABS 2006-1 Ltd.           A-2L      A+   AA/Watch Neg
     ACA ABS 2006-1 Ltd.           A-3L      BBB  A/Watch Neg
     ACA ABS 2006-1 Ltd.           B-1L      BBB- BBB/Watch Neg
     ACA ABS 2006-2 Ltd.           A2L       A+   AA/Watch Neg
     ACA ABS 2006-2 Ltd.           A3L       A-   A/Watch Neg
     ACA ABS 2006-2 Ltd.           B1L       BB+  BBB/Watch Neg
     Arca Funding 2006-II Ltd.     II        AA+  AAA/Watch Neg
     Arca Funding 2006-II Ltd.     III       A+   AA/Watch Neg
     Arca Funding 2006-II Ltd.     IV-A      BBB  A/Watch Neg
     Arca Funding 2006-II Ltd.     IV-B      BBB  A/Watch Neg
     Arca Funding 2006-II Ltd.     V         BB   BBB/Watch Neg
     Arca Funding 2006-II Ltd.     VI        BB-  BBB-/Watch Neg
     Cetus ABS CDO 2006-1 Ltd.     A-1       AA+  AAA/Watch Neg
     Cetus ABS CDO 2006-1 Ltd.     A-2       AA-  AA/Watch Neg
     Cetus ABS CDO 2006-1 Ltd.     B         BBB  A/Watch Neg
     Cetus ABS CDO 2006-1 Ltd.     C         BB   BBB/Watch Neg
     Cetus ABS CDO 2006-1 Ltd.     D         B-   BB+/Watch Neg
     Cetus ABS CDO 2006-2 Ltd.     A-1       AA+  AAA/Watch Neg
     Cetus ABS CDO 2006-2 Ltd.     A-2       A+   AA/Watch Neg
     Cetus ABS CDO 2006-2 Ltd.     B         BBB  A/Watch Neg
     Cetus ABS CDO 2006-2 Ltd.     C         BB   BBB/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     A-2       AA+  AAA/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     B         AA-  AA/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     C-1       BBB+ A/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     C-2       BBB  A-/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     D-1       BB+  BBB/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     D-2       BB   BBB-/Watch Neg
     Cetus ABS CDO 2006-3 Ltd.     E         BB-  BB+/Watch Neg
     Cetus ABS CDO 2006-4 Ltd.     B         BBB+ A/Watch Neg
     Cetus ABS CDO 2006-4 Ltd.     C         BBB- BBB/Watch Neg
     Cetus ABS CDO 2006-4 Ltd.     D         BB   BB+/Watch Neg
     Cetus ABS CDO 2006-4 Ltd.     E         B    BB/Watch Neg
     Cherry Creek CDO I Ltd.       B         BB+  BBB/Watch Neg
     Commodore CDO I Ltd.          B         A+   AA/Watch Neg
     Commodore CDO I Ltd.          C         CCC  BB-/Watch Neg
     GSC ABS CDO 2006-4u Ltd.      A3        A-   A/Watch Neg
     GSC ABS CDO 2006-4u Ltd.      B         BBB- BBB/Watch Neg
     GSC ABS CDO 2006-4u Ltd.      C         BB   BB+/Watch Neg
     Octans III CDO Ltd.           B         A-   A/Watch Neg
     Octans III CDO Ltd.           C         BBB- BBB/Watch Neg
     Octans III CDO Ltd.           E         B    BB/Watch Neg
     Orion 2006-2 Ltd.             A-2       AA+  AAA/Watch Neg
     Orion 2006-2 Ltd.             C-1       A-   A/Watch Neg
     Orion 2006-2 Ltd.             C-2       BBB  A-/Watch Neg
     Orion 2006-2 Ltd.             D-1       BB   BBB/Watch Neg
     Orion 2006-2 Ltd.             D-2       BB-  BBB-/Watch Neg
     Orion 2006-2 Ltd.             E         B-   BB+/Watch Neg
      
Rating Remaining on Creditwatch Negative

         Transaction                  Class        Rating
         -----------                  -----        ------
         Octans III CDO Ltd.          A-1          AAA/Watch Neg

Ratings Affirmed and Removed from Creditwatch Negative

                                                Rating
                                                ------
       Transaction                  Class    To        From
       -----------                  -----    --        ----
       FAB US 2006-1 PLC            B        A-    A-/Watch Neg
       FAB US 2006-1 PLC            C        BBB   BBB/Watch Neg
       GSC ABS CDO 2006-2m Ltd.     D        A     A/Watch Neg
       GSC ABS CDO 2006-2m Ltd.     E        BBB   BBB/Watch Neg
       GSC ABS CDO 2006-2m Ltd.     F        BB+   BB+/Watch Neg
       GSC ABS CDO 2006-2m Ltd.     G        BB    BB/Watch Neg
       GSC ABS CDO 2006-4u Ltd.     A1       AAA   AAA/Watch Neg
       GSC ABS CDO 2006-4u Ltd.     A2       AA    AA/Watch Neg
       Kefton CDO I Ltd.            II       AAA   AAA/Watch Neg
       Kefton CDO I Ltd.            III      AA    AA/Watch Neg
       Kefton CDO I Ltd.            IV       AA-   AA-/Watch Neg
       Kefton CDO I Ltd.            V        A     A/Watch Neg
       Kefton CDO I Ltd.            VI       BBB   BBB/Watch Neg
       Kefton CDO I Ltd.            VII      BB+   BB+/Watch Neg
       Octans II CDO Ltd.           C-2      A-    A-/Watch Neg
       Octans II CDO Ltd.           D        BBB   BBB/Watch Neg
       Octans II CDO Ltd.           X-1      BBB-  BBB-/Watch Neg
       Octans II CDO Ltd.           X-2      BBB-  BBB-/Watch Neg
       Orion 2006-1 Ltd.            A        AAA   AAA/Watch Neg


CMC TELECOM: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: C.M.C. Telecom, Inc.
        51151 Pontiac Trail
        Wixom, MI 48393

Bankruptcy Case No.: 07-56001

Type of business: The Debtor offers full-service
                  telecommunications including local and long
                  distance telephone, calling cards, voicemail,
                  Internet (DSL. T1, T3), ATM, frame relay, and
                  video conferencing.  See http://www.cmctel.com

Chapter 11 Petition Date: August 15, 2007

Court: Eastern District of Michigan (Detroit)

Judge: Marci B. McIvor

Debtor's Counsel: Karin F. Avery, Esq.
                  Silverman & Morris, P.L.L.C.
                  7115 Orchard Lake Road, Suite 500
                  West Bloomfield, MI 48322
                  Tel: (248) 539-1330

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's 18 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
A.T.&T.                                                $3,000,000
c/o Michael G.
Vartanian, Esq.
Dickinson Wright, P.L.L.C.
301 East Liberty Street,
Suite 500
Ann Arbor, MI 48104

Qwest Wholesale Services                                  $63,126
P.O. Box 856184
Louisville, KY 40285

Profitec, Inc.                                            $59,033

Howell Schools                                            $54,842

Internet 123, Inc.                                        $52,020

Van Dyke Public Schools                                   $27,577

Transaction Network Services,                             $27,080
Inc.

West Branch-Rose City                                     $23,410
Schools

U.S. Signal                                               $20,301

Universal Services Admin.                                 $15,986
Co.

Greenville Public Schools                                 $12,702

Cogent Communications                                     $10,650

Computer Systems, L.L.C.                                  $10,105

Smart Telecom Concepts                                    $10,000

Broadwing Communications                                   $9,444

Oxford Area Community Schools                              $9,201

Tawas Area Schools                                         $8,904

Broadwing Communications,                                  $8,560
L.L.C.


COMMSCOPE INC: Obtains Requests for Add'l Info on Andrew's Buyout
-----------------------------------------------------------------
CommScope Inc. and Andrew Corporation have received requests for
additional information from the Antitrust Division of the U.S.
Department of Justice regarding CommScope's pending acquisition of
Andrew.

The information requests were issued under the notification
requirements of the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.
    
The second requests extend the waiting period imposed by the HSR
Act until 30 days after CommScope and Andrew have substantially
complied with the second requests, unless that period is extended
voluntarily by the parties or terminated sooner by the DOJ.

CommScope and Andrew intend to cooperate fully with the DOJ.  The
companies expects to close the transaction before the end of 2007.
    
The transaction remains subject to completion of other customary
closing conditions, including effectiveness of a registration
statement on Form S-4, approval by Andrew's stockholders, and
other international regulatory approvals.
    
                     About Andrew Corporation
    
Headquartered in Westchester, Illinois, Andrew Corporation
(Nasdaq: ANDW) -- http://www.andrew.com/--designs, manufactures  
and delivers innovative and essential equipment and solutions for
the global communications infrastructure market.  The company
serves operators and original equipment manufacturers from
facilities in 35 countries.  

                       About CommScope Inc.

Based in Hickory, North Carolina, CommScope Inc. (NYSE:CTV) --
http://www.commscope.com/-- designs and manufactures "last    
mile" cable and connectivity solutions for communication
networks.  Through its SYSTIMAX(R) Solutions(TM) and Uniprise(R)
Solutions brands CommScope is the global leader in structured
cabling systems for business enterprise applications.  It is
also the world's largest manufacturer of coaxial cable for
Hybrid Fiber Coaxial applications. Backed by strong research and
development, CommScope combines technical expertise and
proprietary technology with global manufacturing capability to
provide customers with high-performance wired or wireless
cabling solutions.  CommScope has facilities in Brazil, Australia,
China and Ireland.

                         *     *     *

CommScope carries Standard & Poor's Rating Services BB corporate
credit rating with a stable outlook.


CREDIT SUISSE: Fitch Cuts Rating on $18.8MM Class N Certs. to B-
----------------------------------------------------------------
Fitch Ratings downgrades a class of Credit Suisse First Boston's
commercial mortgage pass-through certificates, series 2005-CND2:

  -- $18.8 million class N to 'B-' from 'BB-'.

Fitch places these classes on Rating Watch Negative:

  -- $32 million class L rated 'BBB-';
  -- $23 million class M rated 'BB'.

In addition, Fitch affirms these classes:

  -- $327.5 million class A-2 at 'AAA';
  -- Interest-only class A-X-1 at 'AAA';
  -- Interest-only class A-X-2 at 'AAA';
  -- Interest-only class A-X-3 at 'AAA';
  -- Interest-only class A-X-4 at 'AAA';
  -- Interest-only class A-X-5 at 'AAA';
  -- Interest-only class A-Y at 'AAA';
  -- $64 million class B at 'AAA';
  -- $63 million class C at 'AA';
  -- $39 million class D at 'AA';
  -- $36 million class E at 'AA-';
  -- $35 million class F at 'A+';
  -- $37 million class G at 'A';
  -- $33 million class H at 'A-';
  -- $36 million class J at BBB+';
  -- $32 million class K at 'BBB'.
  
Classes A-1, A-1S, and A-1J have been paid in full.

The downgrade of class N and placement of classes L and M on RWN
are due to concerns about fees resulting from the transfer of the
largest loan, Manhattan House (58%), to special servicing as well
as concerns about the transaction's remaining loans, two (8.9%) of
which have matured and remain in the trust.

As of the August 2007 remittance date, the transaction's principal
balance had decreased by 61% to $776.3 million from $1.9 billion
at issuance.  Six loans remain in the pool: Manhattan House (58%),
River Terrace (24.3%), Mizner Court at Broken Sound (7.4%), Spring
Harbor (4.9%), Spring Landing (4.0%), and 80 John Street (1.4%).

The Manhattan House loan has been transferred to special servicing
due to an unresolved buy-out dispute between the partners as well
as resident-initiated litigation.  There have been no sales or
contracts signed for any of the units.  The loan matures on Nov.
9, 2007.  The loan, which has a trust balance of $450 million and
additional subordinate debt of $306 million, is secured by a 583-
unit multifamily rental building located on the Upper East Side of
Manhattan, New York.

At issuance, the Prestige Portfolio loan was secured by five
rental apartment properties in four different Florida cities with
a total of 1,296 units that initially were to be converted to
condominiums.  The borrower cancelled the conversion of the rental
units into condominiums, and is sold three of the five properties.  
The two remaining properties, Spring Harbor and Spring Landing,
matured on Aug. 9, 2007.


CROWN CLO: Full Note Redemption Cues S&P to Withdraw Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings on the
class B, C, D, and E notes issued by Crown CLO 2002-1, an
arbitrage cash flow high-yield CLO transaction.
     
The rating withdrawals follow the full redemption of the notes on
the July 23, 2007, payment date.  The ratings had been placed on
CreditWatch positive on April 12, 2007.
    

Ratings Withdrawn

Crown CLO 2002-1

                  Rating                      Balance
                  ------                      -------
       Class   To      From            Previous     Current
       -----   --      ----            --------     -------
       B       NR      AA/Watch Pos   $26,997,000    0.000
       C       NR      A+/Watch Pos   $10,900,000    0.000
       D       NR      BBB/Watch Pos  $35,000,000    0.000
       E       NR      BB+/Watch Pos   $7,897,000    0.000


                            NR — Not rated.


DEERFIELD TRIARC: Unstable Credit Markets Delay Buy of Deerfield
----------------------------------------------------------------
Deerfield Triarc Capital Corp.'s special committee of the board of
directors informed Triarc Companies Inc. on Thursday that
Deerfield Triarc has not yet been able to complete on acceptable
terms the financing necessary to consummate the previously
announced acquisition by Deerfield Triarc of Deerfield & Company
LLC.

Deerfield Triarc explains that the delay of the completion of the
acquisition was due to the current instability in the credit
markets.

Deerfield Triarc has advised Triarc Companies that it is
continuing to work with its lenders to obtain appropriate
financing.  Under the definitive acquisition agreement, Deerfield
Triarc's obligation to complete the acquisition is subject to the
receipt by Deerfield Triarc of financing for the cash portion of
the purchase price and related transaction costs.

On Aug. 9, 2007, Deerfield Triarc's shareholders approved the
issuance in the acquisition of about 9.6 million Deerfield Triarc
shares.  Under the definitive agreement the parties have until
Oct. 19, 2007, to complete the transaction, unless extended by
mutual agreement.

                    About Triarc Companies Inc.

Triarc Companies Inc. (NYSE: TRY.B or TRY) --
http://www.triarc.com/--  is a holding company and, through its   
subsidiaries, is currently the franchisor of the Arby's restaurant
system and the owner of approximately 94% of the voting interests,
64% of the capital interests and at least 52% of the profits
interests in Deerfield & Company LLC, an asset management firm.  
The Arby's restaurant system is comprised of approximately 3,600
restaurants, of which, as of Dec. 31, 2006, 1,061 were owned and
operated by the company's subsidiaries.

Deerfield & Company LLC, through its wholly-owned subsidiary,
Deerfield Capital Management LLC, is a Chicago-based asset manager  
offering a diverse range of fixed income and credit-related
strategies to institutional investors with about $13.2 billion
under management as of Dec. 31, 2006.

                     About Deerfield Triarc

Headquartered in Lenexa, Kansas, Deerfield Triarc Capital Corp.
(NYSE: DFR) -- http://www.deerfieldtriarc.com/-- is a diversified   
financial company formed in 2004 to invest in real estate-related
securities and various other asset classes.  The company intends
to continue to qualify to be taxed as a real estate investment
trust, or REIT, for federal income tax purposes.  The objective is
to provide attractive returns to investors through a combination
of dividends and capital appreciation, which the company intends
to achieve by opportunistically investing in financial assets and
to construct an investment portfolio appropriately leveraged to
seek attractive risk-adjusted returns.  The company is externally
managed by Deerfield Capital Management LLC.

                          *     *     *

As reported in the Troubled Company Reporter on July 13, 2007,
Standard & Poor's Ratings Services assigned its 'BB-' long-term
counterparty credit rating to Deerfield Triarc Capital Corp.  The
outlook is stable.  At the same time, S&P assigned 'B' bank loan
rating to the company's $155 million senior secured term loan; the
recovery rating is '6'.


DELPHI CORP: Inks MOU with Steelworkers and General Motors
----------------------------------------------------------
Delphi Corp. has signed a Memorandum of Understanding with the
United Steelworkers (and its local 87L) and General Motors Corp.
representing certain U.S. hourly employees at the Delphi's Dayton
(Home Avenue) and Vandalia, Ohio operations.  The tentative
agreements advance Delphi's transformation initiatives and are
subject to union ratification and approval by the U.S. Bankruptcy
Court.

If the contract is ratified by the union membership, it will
expire on Sept. 14, 2011.

USW Local 87 President Dennis Bingham said that details of the
agreement are being withheld pending contract explanation meetings
with the membership.  Following the meetings, the tentative
agreement will be subject to ratification by the membership.

"Although this series of negotiations has been lengthy and
complex, we are pleased to have now attained consensual labor
agreements with all of our U.S. unions and General Motors on
issues impacting our operations and transformation initiatives,"
John Sheehan, chief restructuring officer, said.  "We remain
committed to working with our labor unions, GM and all of our
other Chapter 11 stakeholders to successfully emerge later this
year."

Delphi will not comment on the details of the tentative agreement,
pending ratification by the respective unions.

Headquartered in Troy, Mich., Delphi Corporation (OTC: DPHIQ) --
http://www.delphi.com/-- is the single supplier of vehicle   
electronics, transportation components, integrated systems and
modules, and other electronic technology.  The company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  Delphi has regional headquarters
in Japan, Brazil and France.

The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors.  As of
Mar. 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.  The Debtors'
exclusive plan-filing period expires on Dec. 31, 2007.


DENALI CAPITAL: Note Redemptions Cue S&P to Withdraw Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings on the
class A-1L-A, A-1L-B, A-2L, A-3L, A-4L, A-4F, B-1L, and B-2L notes
issued by Denali Capital CLO III Ltd., an arbitrage high-yield CLO
transaction managed by Denali Capital LLC.
     
The rating withdrawals follow the optional redemption of the notes
by the issuer pursuant to section 9.1 of the indenture.  The
redemption took place on the July 21, 2007, payment date.
   

Ratings Withdrawn

Denali Capital CLO III Ltd.

                     Rating                     Balance
                     ------                     -------
   Class         To         From          Current     Previous
   -----         --         ----          -------     --------
   A-1L-A        NR         AAA            0.00      $72,878,000
   A-1L-B        NR         AAA            0.00     $133,121,000
   A-2L          NR         AAA            0.00      $12,500,000
   A-3L          NR         AA             0.00      $30,000,000
   A-4L          NR         A-             0.00      $24,000,000
   A-4F          NR         A-             0.00       $5,000,000
   B-1L          NR         BBB            0.00      $18,000,000
   B-2L          NR         BB             0.00      $12,000,000
   

                            NR - Not rated.


DRS TECHNOLOGIES: Moody's Affirms B1 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service affirmed all ratings of DRS
Technologies, Inc., Corporate Family rating of B1, and has changed
the company's ratings outlook to positive from stable.

The ratings outlook was changed in light of the observed trend
towards de-levering since the December 2005 acquisition of
Engineered Support Systems, Inc., along with the company's
demonstration of successful integration of ESSI and other prior
acquisitions in its operations while maintaining operating margins
and generating robust cash flows.  The positive rating outlook
reflects Moody's expectations that DRS will continue to de-lever
over the next 12 months, through continued improvement in
operating results as well as through further debt reduction made
possible by positive free cash flow generation.  Moody's expects
that DRS will continue to generate operating margins of about 11%
over this period.

DRS' ratings reflect the company's sizeable diversified revenue
base with substantial backlog support, which is indicative of the
company's strong market position in the U.S. military contracting
sector.  The company's backlog provides revenue visibility and
supports expectations for continued strong and stable operating
margins that should result in good, albeit volatile free cash flow
generation over the next few years.  

However, the ratings continue to be constrained by high debt
levels and ensuing leverage which Moody's expects will improve
through FY 2008, but predominantly through growth in profitability
rather than through debt repayment.  Ratings also consider the
uncertainty surrounding announced delays in the Thermal Weapon
Sights II program: its effect on future cash flows and potential
additional write-downs in particular.  Moody's expects that there
will be only minor, if any, recurring problems relating to the TWS
program, and that this issue will gradually diminish as a credit
concern.  However, if the resolution of this contract problem is
lengthier or more costly than currently anticipated, or if the
scope of the problem extends into other programs, this issue may
forestall an upgrade in the near term.

Ratings could be upgraded if the company were to maintain current
levels of cash flow generation on operating margins of 10-11%,
while continuing to reduce debt.  

These credit metric levels may positively affect ratings:

-- Leverage: Debt/EBITDA below 4.5 times;
-- Interest Coverage: EBIT/Interest remains above 2.0 times; and
-- Cash Flow: Retained cash flow/Debt remains in excess of 12%
    while free cash flow exceeds 5% of debt.

The outlook could be stabilized or ratings downgraded if operating
results were to deteriorate materially for a prolonged period,
resulting in thin or negative free cash flow generation, hindering
the repayment of debt.  Ratings could also be revised downward if
the company increases debt materially for any reason, levered
acquisitions in particular, or if problems encountered in the TWS
II contract were to continue into future periods, requiring
further write-downs of inventory or stress on working capital.

These credit metric levels may result in a downgrade:

-- Leverage: Debt/EBITDA in excess of 5.5 times;
-- Interest Coverage: EBIT/Interest below 1.8 times;
-- Cash Flow: Retained cash flow/Debt below 10% or negative free
    cash flows for a prolonged period; or
-- Margins: Operating Margin below 9%.

These ratings have been affirmed:

-- Senior secured credit facilities at Ba1 (LGD2, 12%)
-- Senior unsecured notes at B1 (LGD3, 46%)
-- Senior subordinated notes at B3 (LGD5, 84%)
-- Corporate Family Rating of B1
-- Probability of Default Rating of B1

DRS Technologies, Inc., headquartered in Parsippany, New Jersey,
is a leading supplier of integrated products, services and support
to military forces, intelligence agencies and prime contractors
worldwide.  The company operates through four business segments:
C4I (Command, Control, Communications, Computers, and
Intelligence) Group, RSTA (Reconnaissance, Surveillance and Target
Acquisition) Group, Sustainment Systems, and Technical Services.


EMTA HOLDINGS: Losses Cue Auditor's Going Concern Doubt Opinion
---------------------------------------------------------------
Semple, Marchall & Cooper LLP in Phoenix, Ariz., expressed
substantial doubt about EMTA Holidngs Inc.'s ability to continue
as a going concern after auditing the company's consolidated
financial statements for the year ended March 31, 2007.  The
auditing firm said that the company has significant operating
losses and negative working capital.

The company posted a $17,056,043 net loss on $1,053,767 of total
revenues for the year ended March 31, 2007, as compared with a
$5,132,298 net loss on $562,779 of total revenues in the prior
year.

At March 31, 2007, the company's balance sheet showed $3,591,841
in total assets and $6,390,890 in total liabilities, resulting in
a $2,799,049 stockholders' deficit.  The company also reported
strained liquidity in its balance sheet with $783,444 in total
current assets and $6,390,890 in total current liabilities,
resulting in a $5,607,446 working capital deficit.

A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?22a8

Headquartered in Scottsdale, Ariz. EMTA Holdings, Inc. (OTCBB:
EMHD) -- provides innovative solutions to conserve energy usage,
particularly for petroleum-based fuels.  The company makes the
XenTx line of automotive energy conservation products.  The
company has developed unique products that are sold to industrial
and commercial customers as well as to retail consumers.  In
addition, the company is currently developing three new
lubrication products and is interested in identifying future
merger opportunities.


GE CAPITAL: Moody's Affirms Low-B Ratings on Four Cert. Classes
---------------------------------------------------------------
Moody's Investors Service upgraded the ratings of five classes and
affirmed the ratings of 12 classes of GE Capital Commercial
Mortgage Corporation, Commercial Mortgage Pass-Through
Certificates, Series 2001-2 as:

-- Class A-2, $23,919,087, affirmed at Aaa
-- Class A-3, $37,739,058, affirmed at Aaa
-- Class A-4, $519,456,000, affirmed at Aaa
-- Class X-1, Notional, affirmed at Aaa
-- Class X-2, Notional, affirmed at Aaa
-- Class B, $40,115,000, affirmed at Aaa
-- Class C, $45,129,000, upgraded to Aaa from Aa1
-- Class D, $12,537,000, upgraded to Aa2 from Aa3
-- Class E, $10,028,000, upgraded to Aa3 from A2
-- Class F, $18,804,000, upgraded to A3 from Baa2
-- Class G, $11,283,000, upgraded to Baa1 from Baa3
-- Class H, $21,311,000, affirmed at Ba1
-- Class I, $18,804,000, affirmed at Ba2
-- Class J, $5,014,000, affirmed at Ba3
-- Class K, $7,522,000, affirmed at B2
-- Class L, $12,536,000, affirmed at Caa1
-- Class M, $7,521,000, affirmed at Caa2

As of the Aug. 13, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by about 20.5% to
$797.4 million from $1 billion at securitization.  The
certificates are collateralized by 113 mortgage loans ranging in
size from less than 1% to 5.2% of the pool, with the top 10 loans
representing 27.5% of the pool.  The pool includes two shadow
rated loans representing 7.4% of the pool.  Twenty-two loans,
representing 23.2% of the pool, have defeased and have been
replaced with U.S. Government securities.

Five loans have been liquidated from the trust, resulting in an
aggregate realized loss of about $9.2 million.  Currently there
are no loans in special servicing.  Twenty-eight loans,
representing 21.3% of the pool, are on the master servicer's
watchlist.

Moody's was provided with full-year 2006 operating results for
90.3% of the pool.  Moody's loan to value ratio for the conduit
component is 87.5%, compared to 90.4% at Moody's last full review
in June 2005 and compared to 82.9% at securitization.  Moody's is
upgrading Classes C, D, E, F and G due to defeasance, increased
subordination levels and improved overall pool performance.

The largest shadow rated loan is the Holiday Inn -- 57th Street
Loan ($41.8 million -- 5.2%), which is secured by a 596-room full
service hotel located in midtown Manhattan.  Occupancy and RevPAR
for calendar year 2006 were 87.9% and $184.68, respectively,
compared to 84.9% and $117 for calendar year 2004.  Moody's
current shadow rating is A3, compared to Baa3 at last review.

The second shadow rated loan is the Lake Buena Vista Stores Loan
($17.5 million - 2%), which is secured by a 179,400 square foot
factory outlet center located in Orlando, Florida.  The center is
97% occupied, compared to 93% at last review.  Performance has
been impacted by a decline in rental income and increased
expenses, which have been partially offset by amortization.  The
loan amortizes on a 25-year schedule and has amortized by about
10% since securitization.  Moody's current shadow rating is Baa3,
the same as at last review.

The top three conduit loans represent 8.8% of the outstanding pool
balance.  The largest conduit loan is the One Capital Loan
($26.3 million -- 3.3%), which is secured by two office buildings
totaling 201,700 square feet located in downtown Sacramento,
California.  The loan is on the master servicer's watchlist due to
a decrease in occupancy and low debt service coverage.  The
property was 84% leased as of June 2007, compared to 74% at last
review, but rents have declined since securitization.  Moody's LTV
is in excess of 100%, the same as at last review.

The second largest conduit loan is the Meadowbrook Commons Loan
($24.5 million -- 3.1%), which is secured by a 173,000 square foot
anchored retail center located in Freeport (Nassau County), New
York.  The property was 95% leased as of March 2007, compared to
100% at last review.  Anchors include Stop & Shop, Toys"R"Us and
Marshalls.  Performance has declined due to decreased revenues and
increased expenses.  Moody's LTV is 89.5%, compared to 85.8% at
last review.

The third largest conduit loan is the Dreamland Shopping Center &
Lowe's Loan ($22.9 million -- 2.9%), which is secured by a Lowe's
Home Improvement store and an adjacent 126,800 square foot
anchored retail center located in Asheville, North Carolina.  The
property was 97% occupied as of Mary 2007, the same as at last
review.  Moody's LTV is 86.6%, compared to 98.5% at last review.


GENERAL MOTORS: Union Workers Will Strike If Contract Talks Fail
----------------------------------------------------------------
A strike authorization vote was determined by union workers of a
General Motors Corp. factory in Lansing, Michigan, if the United
Auto Workers is unsuccessful in coughing up a new contract
agreement with GM, various sources say.

Papers report that UAW Local 652 president Chris Sherwood said
that 97% of the members voted in favor of a strike.

GM's contracts expire Sept. 14, 2007.

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs    
about 280,000 people around the world and manufactures cars and
trucks in 33 countries, including the United Kingdom, Germany,
France, Russia, Brazil and India.  In 2006, nearly 9.1 million
GM cars and trucks were sold globally under the following
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden,
HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security
and information services.

                          *     *     *

As reported in the Troubled Company Reporter on May 28, 2007,
Standard & Poor's Ratings Services placed General Motors Corp.'s
corporate credit rating at B/Negative/B-3.

At the same time, Moody's Investors Service affirmed GM's B3
Corporate Family Rating and B3 Probability of Default Rating,
and maintained its SGL-3 Speculative Grade Liquidity Rating.  
The rating outlook remains negative, according to Moody's.


GENERAL MOTORS: Inks MOU with Steelworkers and Delphi Corp.
-----------------------------------------------------------
General Motors Corp. has signed a Memorandum of Understanding with
the United Steelworkers and Delphi Corp. representing certain U.S.
hourly employees at the company's Dayton (Home Avenue) and
Vandalia, Ohio operations.  The tentative agreements advance
Delphi's transformation initiatives and are subject to union
ratification and approval by the U.S. Bankruptcy Court.

If the contract is ratified by the union membership, it will
expire on Sept. 14, 2011.

USW Local 87 President Dennis Bingham said that details of the
agreement are being withheld pending contract explanation meetings
with the membership.  Following the meetings, the tentative
agreement will be subject to ratification by the membership.

"Although this series of negotiations has been lengthy and
complex, we are pleased to have now attained consensual labor
agreements with all of our U.S. unions and General Motors on
issues impacting our operations and transformation initiatives,"
John Sheehan, chief restructuring officer, said.  "We remain
committed to working with our labor unions, GM and all of our
other Chapter 11 stakeholders to successfully emerge later this
year."

Delphi will not comment on the details of the tentative agreement,
pending ratification by the respective unions.

                        About Delphi Corp.

Headquartered in Troy, Mich., Delphi Corporation (OTC: DPHIQ) --
http://www.delphi.com/-- is the single supplier of vehicle   
electronics, transportation components, integrated systems and
modules, and other electronic technology.  The company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  Delphi has regional headquarters
in Japan, Brazil and France.

The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors.  As of
Mar. 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.  The Debtors'
exclusive plan-filing period expires on Dec. 31, 2007.

                      About General Motors

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs    
about 280,000 people around the world and manufactures cars and
trucks in 33 countries, including the United Kingdom, Germany,
France, Russia, Brazil and India.  In 2006, nearly 9.1 million
GM cars and trucks were sold globally under the following
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden,
HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security
and information services.

                          *     *     *

As reported in the Troubled Company Reporter on May 28, 2007,
Standard & Poor's Ratings Services placed General Motors Corp.'s
corporate credit rating at B/Negative/B-3.

At the same time, Moody's Investors Service affirmed GM's B3
Corporate Family Rating and B3 Probability of Default Rating,
and maintained its SGL-3 Speculative Grade Liquidity Rating.  
The rating outlook remains negative, according to Moody's.


GVI SECURITY: Reports Net Income of $308,000 in Second Quarter
--------------------------------------------------------------
GVI Security Solutions Inc. reported on Aug. 13, 2007, its
financial results for the second quartr ending June 30, 2007.

Net income for the second quarter of 2007 was $308,000, up 92%  
compared to a net profit of $160,000 in the prior quarter and
compared to a loss of $4.5 million in the second quarter of 2006.
Excluding results from discontinued operations, the net loss a
year ago was $2.2 million.  The increase in income as compared to
the prior quarter reflects continuing increases in higher margin
product sales combined with continued effective cost controls.  
The swing to a profit, as compared to a loss in the prior year
quarter reflects the implementation of effective cost controls,
the increase in premium priced products and the company's
concentration on core business.

Revenue was $12.27 million up 11 percent from $11.02 million in
the prior quarter and up 9.5 percent from $11.16 million in the
second quarter of 2006.  The increase in revenue over the first
quarter was attributable to sales growth in both the United States
and Latin America.

"The groundwork we laid over the last year has delivered a solid
foundation for our growing profitability moving forward," stated
GVI chief executive officer Steven Walin.  "We are continuing to
drive profit growth in premium segments of the video security
surveillance marketplace including school security, banking and
large retail chains.  We are also starting to see positive results
from our expanded and enhanced partnership with Samsung, which is
driving our product mix towards higher quality products with
advanced technical features that support premium pricing."

"We are pleased to report our second consecutive quarter of record
profits," stated GVI chief financial officer Joe Restivo.    
"Results were strong with net income of $308,000, almost double
the prior quarter, reflecting growing sales and effective cost
controls.  Top line growth was robust, with net sales up 11% over
the prior quarter . Sales increased across both the US and Latin
America.  Compared to the comparable period in 2006, our 2007
results reflect a company that has been reengineered for  
profitable growth with a greatly improved cost structure and a
favorable product mix."

Selling, general and administrative expenses for the second
quarter were $2.8 million or just under 23% of revenues,
essentially unchanged on a percentage of revenue basis from
$2.4 million, or just under 23% of revenues, during the prior
quarter and substantially lower than the $4.49 million or 39.9% of
revenues recorded in the second quarter of 2006.  The results
reflected continued effective cost controls and stable expenses as
a percentage of revenue across the company's operations following
the implementation of effective cost controls subsequent to the
prior year second quarter.

Net Revenues for the first six months of 2007 were $23.3 million,
compared to revenues of $22.9 million during the same period a
year ago.  Net income for the first half of 2007 was $469,000  
compared to a net loss of $7.0 million in the second quarter of
2006.  Excluding results from discontinued operations, the net
loss for the first half of 2006 was $3.7 million.  Gross profit
for the second half of 2007 was $6.4 million, up 31% as compared
to $4.9 million in the second half of 2006.

At June 30, 2007, the company's consolidated balance sheet showed
$18.0 million in total assets, $17.8 million in total liabilities,
and $204,000 in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a5

                       Going Concern Doubt

Weinberg & Company P.A., in Los Angeles, expressed substantial
doubt about GVI Security Solutions Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2006.  The auditing firm
pointed to the company's recurring losses and negative cash flows
from operating activities, which have resulted in a negative
working capital and a stockholders' equity deficiency.

During the years ended December 31, 2006, 2005 and 2004, the
company experienced negative cash flow and operating losses, which
have resulted in a significant reduction in the company's cash
balances.

The company will require additional equity or debt financing to
repay its term and revolving credit loans to Laurus Master Fund,
which become due Dec. 31, 2007, and may also require additional
capital to finance its operations, working capital or other
capital expenditures.

                  About GVI Security Solutions

Headquartered in Carollton, Texas, GVI Security Solutions Inc.
(OTC BB: GVSS) -- http://www.gviss.com/-- is a global provider of    
video surveillance security solutions to the homeland security,
institutional and commercial market segments.


H.Q.Z. PROPERTIES: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: H.Q.Z. Properties, L.L.C.
        237 West Northfield Boulevard, Suite 201
        Murfreesboro, TN 37129

Bankruptcy Case No.: 07-05885

Chapter 11 Petition Date: August 16, 2007

Court: Middle District of Tennessee (Nashville)

Judge: Keith M. Lundin

Debtor's Counsel: Steven L. Lefkovitz, Esq.
                  618 Church Street, Suite 410
                  Nashville, TN 37219
                  Tel: (615) 256-8300
                  Fax: (615) 250-4926

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

The Debtor does not have any creditors who are not insiders.


HANOVER COMPRESSOR: Stockholders OK Universal Compression Merger
----------------------------------------------------------------
Hanover Compressor Company and Universal Compression Holdings Inc.
jointly reported that, at the companies' stockholders meetings,
the stockholders of each company approved by a substantial margin
the merger of the two companies into a new company, Exterran
Holdings Inc.

The stockholders of both companies also approved the adoption of
the Exterran 2007 Stock Incentive Plan and the Exterran Employee
Stock Purchase Plan.  

Hanover and Universal expect the merger to close Monday, Aug. 20,
2007.  On the day after the merger closing, Exterran's common
stock will begin trading under the symbol "EXH" on the New York
Stock Exchange, and the common stock of Hanover and Universal will
no longer be traded.

               About Universal Compression Holdings

Headquartered in Houston, Texas, Universal Compression Holdings
Inc., (NYSE: UCO) -- http://www.universalcompression.com/-- is a
natural gas compression services company, providing a full range
of contract compression, sales, operations, maintenance and
fabrication services to the domestic and international natural gas
industry.

                     About Hanover Compressor

Headquartered in Houston, Texas, Hanover Compressor Company,
(NYSE: HC) -- http://www.hanover-co.com/-- rents and repairs     
compressors and performs natural gas compression services for oil
and gas companies.  The company's subsidiaries also provide
service, fabrication, and equipment for oil and natural gas
processing and transportation applications.  It has locations in
India, China, Indonesia, Japan, Korea, Taiwan, the United Kingdom,
and Vietnam, among others.

                          *     *     *

Moody's Investor Services assigned B1 rating on Hanover Compressor
Company's long term corporate family and probability of default on
July 16, 2007.  The outlook is stable.


HAWK CORP: S&P Holds "B" Rating and Removes Negative CreditWatch
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on
Cleveland, Ohio-based Hawk Corp., including its 'B' corporate
credit rating.  At the same time, the ratings were removed from
CreditWatch where they were placed with negative implication on
Jan. 4, 2007 following the announcement of a government inquiry.
      
"The rating actions follow the completion of the tender offer and
the resulting improved liquidity position of the company.  The
negative outlook reflects uncertainty regarding the potential
outcome of an ongoing SEC investigation," said Standard & Poor's
credit analyst Gregoire Buet.
     
Hawk remains subject to a formal investigation by the SEC
regarding the company's preparation for compliance with Section
404 of the Sarbanes-Oxley Act and related communication with third
parties.  The company indicated that it is cooperating with the
government's request for documents and that it does not believe
the investigations will result in the restating of financial
statements.  There is, however, significant uncertainty as to
whether this could result in potentially adverse events, including
senior executive involvement in the matter, future financial
penalties, or compliance risk.
     
Hawk's financial risk profile is considered highly leveraged, and
credit protection measures have been volatile.  Following the
completion of the tender offer, debt has been reduced by about $23
million.  The company has indicated that it intends to use its
cash balance to fund capital investments or acquisitions, in order
to support growth in friction products markets.  Hawk also
announced a limited share repurchase program.


IMPAC CMB: Moody's Hold B2 Rating on $11.1 Million Class G Certs.
-----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of eight classes of
IMPAC CMB Trust 1998-C1, Collateralized Mortgage Bonds as:

-- Class A-1B, $18,287,394, affirmed at Aaa
-- Class A-2, $1,740,098, affirmed at Aaa
-- Class B, $15,889,000, affirmed at Aaa
-- Class C, $19,066,000, affirmed at Aaa
-- Class D, $20,655,000, affirmed at Aaa
-- Class E, $4,767,000, affirmed at Aaa
-- Class F, $18,271,000, affirmed at A3
-- Class G, $11,122,000, affirmed at B2

As of the July 20, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by about 62.7% to
$118.4 million from $317.8 million at securitization.  The
certificates are collateralized by 63 loans ranging in size from
less than 1% to 9% of the pool, with the top 10 loans representing
48.2% of the pool.

Five loans have been liquidated from the trust resulting in
aggregate realized losses of about $3.3 million.  Four loans,
representing 8.4% of the pool, are in special servicing.  Moody's
has estimated aggregate losses of about $3.9 million for all of
the specially serviced loans.  One loan, representing 1.3% of the
pool, has defeased and has been replaced with U.S. Government
securities.  Thirteen loans, representing 20.9% of the pool, are
on the master servicer's watchlist.

Moody's was provided with year-end 2006 operating results for
90.3% of the performing loans.  Moody's weighted average loan to
value ratio is 81.9%, compared to 86.2% at Moody's last full
review in March 2006 and compared to 81.5% at securitization.

The top three loan exposures represent 20.9% of the outstanding
pool balance.  The largest loan concentration is the Ghidorzi
Portfolio Loans ($10.6 million -- 9%), which consists of three
cross collateralized mortgage loans secured by two office
buildings and one industrial property.  All of the properties are
located in Wausau, Wisconsin.  The properties range in size from
52,000 to 371,000 square feet and total 480,400 square feet.
Moody's LTV is 68.4%, compared to 70.3% at last review and
compared to 90.6% at securitization.

The second largest loan is the Harvard Market Loan
($7.9 million -- 6.7%), which is secured by a 41,000 square foot
retail property located in Seattle, Washington.  The property is a
condominium interest in a 91,000 square foot (41,000 square feet
of retail space is collateral) mixed use condominium project.  The
property is shadow anchored by Quality Food Centers.  Occupancy as
of December 2006 was 97%, compared to 95% at last review and
compared to 97% at securitization.  The major tenant is the
Bartell Drug Company.  The loan is on the master servicer's
watchlist due to low debt service coverage caused by higher
expenses.  Moody's LTV is 88.5%, compared to 85.8% at last review
and compared to 92.2% at securitization.

The third largest loan is the Irvine Spectrum Auto Center Loan
($6.2 million -- 5.2%), which is secured by a 42,000 square foot
industrial building located in Irvine, California.  As of February
2007 the property was 100% leased, compared to 69% at last review
and compared to 94% at securitization.  The loan is on the master
servicer's watchlist due to low debt service coverage.  Moody's
LTV is 97.5%, compared to in excess of 100.0% at last review and
compared to 83.3% at securitization.


INLAND EMPIRE: Fitch Rates $18.948 Million Term Bonds at BB
-----------------------------------------------------------
Fitch assigns ratings to the Inland Empire Tobacco Securitization
Authority tobacco settlement asset-backed bonds series 2007 on
behalf of Riverside County, California issuance as:

  -- $32,500,000.00 series 2007A senior current interest bonds,
     due June 1, 2021 'BBB';
  -- $55,150,000.00 series 2007A senior current interest bonds,
     due June 1, 2021 'BBB';
  -- $53,757,702.60 series 2007B senior convertible turbo term
     bonds, due June 1, 2026 'BBB';
  -- $53,541,801.45 series 2007C-1 subordinate turbo capital
     appreciation term bonds, due June 1, 203 'BBB';
  -- $29,652,581.40 series 2007C-2 subordinate turbo capital  
     appreciation term bonds, due June 1, 2047 'BBB';
  -- $23,457,163.80 series 2007D subordinate turbo capital
     appreciation term bonds, due June 1, 2057 'BBB-';
  -- $18,948,552.00 series 2007E subordinate turbo capital
     appreciation term bonds, due June 1, 2057 'BB'.

The ratings of the above bonds address the issuer's ability to pay
timely interest payments and principal of the series 2007 bonds by
their legal final maturity dates as referenced above.

The collateral securing the series 2007 bonds consists of the
authority's rights under a loan agreement with the corporation.  
The loan agreement is secured by the county's share of the state's
tobacco settlement revenues received under the California Consent
Decree.

The assigned ratings are based on the bond structure and credit
quality of the underlying collateral which consists of annual
payments and strategic contribution payments by the three largest
domestic tobacco manufacturers: Philip Morris Inc., Reynolds
American Inc., and Lorillard Tobacco Co., under a master
settlement agreement entered into with the attorneys general of 46
states, the District of Columbia, the Commonwealth of Puerto Rico,
the U.S. Virgin Islands, the Commonwealth of Northern Mariana
Islands, American Samoa, and Guam.

Fitch's view of the credit quality of the collateral takes into
account two fundamental characteristics of the MSA: since payments
under the MSA are based on the relative market share of the
domestic tobacco manufacturers, the payment obligation can be
considered an industry obligation, which Fitch currently deems to
be rated 'BBB-'; and the MSA should survive the bankruptcy of a
domestic tobacco manufacturer, making it more likely that the
manufacturer would continue to make payments under the MSA ahead
of its unsecured indebtedness.  These are the major
characteristics of the MSA that support and, at the same time,
limit the rating of the tobacco settlement senior bonds to 'BBB'.

Accordingly, the rating on this transaction is linked to and will
move with Fitch's future assessment of the tobacco industry's
overall credit quality.  The credit quality of the industry, in
turn, will be significantly influenced by the underlying ratings
of the three major domestic tobacco manufacturers and Fitch's view
of the relative strength of those three manufacturers within the
overall domestic tobacco industry.  

In addition, since payments under the MSA are subject to various
adjustments and offsets based on several factors, including
cigarette consumption, Fitch developed a series of cash flow
stresses to determine the transaction's ability to pay the
principal amount and accreted values of the respective bonds by
their stated legal final maturity dates.  Fitch's cash flow
stresses, however, do not take into consideration any non-
participating manufacturers' adjustments.  The rating is based on
the transaction's ability to withstand cash flow stresses
commensurate with a 'BBB' rating for the senior series 2007A and
senior series 2007B bonds.  Fitch will also be rating the
subordinate series 2007 C-1, the subordinate series 2007C-2, the
subordinate series 2007D series, and the subordinate series 2007 E
bonds, 'BBB', 'BBB', 'BBB-', and 'BB', respectively. Fitch will
not be rating the subordinate series 2007 F capital appreciation
turbo term bonds.  Finally, the ratings reflect the transaction's
sound legal and financial structures.


INTEGRA TELECOM: Moody's Rates $645 Mil. Credit Facility at Ba3
---------------------------------------------------------------
Moody's Investors Service revised the rating of Integra Telecom
Holdings, Inc.'s $645 million 1st lien senior secured credit
facilities to Ba3, from B1, while affirming the Caa1 rating for
its 2nd lien term loan.

Integra Telecom Holdings, Inc. is a wholly-owned subsidiary of
Integra Telecom, Inc.  As part of the rating action, Moody's
affirmed the Caa2 rating for the company's $280 million Senior
unsecured PIK loan, and Integra's B3 Corporate Family Rating and
its probability-of-default rating.  The Outlook is Stable.

The ratings changes were triggered by the changes in the structure
of credit facilities since Moody's first-time ratings assignment
on July 12, 2007.  The bank facilities will be used to fund the
acquisition of Eschelon Telecom, Inc. and to refinance existing
debt.  The acquisition will create the largest competitive local
exchange carrier in the Midwest and Pacific Northwest USA.  Upon
the closing of the acquisition, Moody's will withdraw Eschelon's
ratings, once the Eschelon notes are either called by Integra or
put by the holders.

Moody's took these rating actions:

Issuer -- Integra Telecom, Inc.

-- Corporate Family Rating -- Affirmed B3
-- Probability-of-default rating -- Affirmed B3
-- $280 million Senior Unsecured PIK Loan, due 2014 -- Affirmed
    Caa2 (LGD 5 -- 89%, changed from LGD 6 -- 92%)

Issuer -- Integra Telecom Holdings, Inc.

-- $50 million 1st Lien Secured RC, due 2012 -- Revised to Ba3
    (LGD 2 -- 21%), from B1 (LGD 2 -- 28%)

-- $595 million 1st Lien Secured TL, due 2013 -- Revised to Ba3
    (LGD 2 -- 21%), from B1 (LGD 2 -- 28%)

-- $325 million 2nd Lien Secured TL, due 2014 -- Affirmed Caa1
    (LGD 4 -- 64%, changed from LGD 5 -- 75%)

The Outlook is Stable.

The B3 corporate family rating reflects Integra's financial risk,
primarily high leverage, challenging competitive position as a
CLEC, and the complexity of integrating the Eschelon acquisition.
The ratings benefit from the company's emerging operating scale in
its service territories and the expected EBITDA growth driven by
merger synergies.

Moody's notes that Integra's credit metrics will benefit from the
recent announcement to convert all of its outstanding preferred
stock to common stock.  Although the conversion of the preferred
stock will lead to a reduction in leverage by slightly over 1x (as
Moody's had accounted for 75% preferred stock as debt), Integra's
expected leverage of 6.9x at closing is high relative to the CLECs
that Moody's rates.  Integra also announced that Warburg Pincus
has agreed to invest at least $245 mm of equity in a secondary
purchase of common stock.  While the proposed investment supports
the Company's equity valuation, it does not directly benefit the
creditors by deleveraging or enhancing liquidity.

The revision of the 1st lien credit facility's rating reflects a
lower expected loss due to the increase in junior debt cushion
following the proposed changes to the credit facilities.  The 1st
lien debt will now represent 50% of the total outstanding debt,
compared to 60% in the previously contemplated structure.

Integra, headquartered in Portland, OR, is a CLEC providing
telecommunications services to small and medium-sized enterprises
and other communications companies.  Eschelon is a CLEC with
headquarters in Minneapolis, MN.  The combined company will serve
about 120,000 customers in the Western and Midwestern United
States with pro forma revenue of $670 million in LTM 2Q 2007.


INTEGRA TELECOM: S&P Affirms B- Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit rating on Portland, Oregon-based competitive local exchange
carrier Integra Telecom Inc.
     
The affirmation follows the company's announcement that it will
convert all of its $365 million of mandatory redeemable preferred
stock to common stock and modify its proposed debt financing,
which will be used partly for the acquisition of Eschelon Telecom
Inc. (B-/Stable/--), a Minneapolis, Minnesota-based CLEC.  The
outlook is positive.
      
"While these changes are viewed as incrementally favorable for
credit quality, the impact is not sufficiently material to change
the rating or outlook," said Standard & Poor's credit analyst
Allyn Arden.  When S&P originally assigned the ratings on
July 13, 2007, S&P had attributed half of the $365 million of
preferred stock to debt.  With the conversion of the preferred
stock to common stock, initial leverage does improve to about 7x
from 8x on an operating lease-adjusted basis.  However, this
marginal improvement in leverage is somewhat tempered by a 100-
basis-point increase in the interest rate on its proposed
$970 million secured credit facilities and a 150-basis-point
increase on its unsecured floating-rate payment-in-kind loan.
     
At the same time, S&P affirmed the 'CCC+' bank loan rating and '5'
recovery rating on subsidiary Integra Telecom Holdings Inc.'s
proposed $50 million senior secured first-lien revolver and
$595 million term loan, which is being reduced from $715 million.  
The '5' recovery rating indicates the expectation for modest (10%-
30%) recovery in the event of payment default.  S&P also affirmed
the 'CCC' bank loan rating and '6' recovery rating on the $325
million senior secured second-lien term loan, which is being
upsized from $270 million.  The '6' recovery rating indicates the
expectation for negligible (0%-10%) recovery in the event of
payment default.  Integra Telecom Inc.'s proposed
$280 million senior unsecured floating-rate PIK loan, which is
also being upsized from $215 million, is rated 'CCC'.
     
Proceeds of $1.2 billion, coupled with $40 million of cash, will
be used to fund the $559 million equity purchase price of
Eschelon, redeem $462 million of Integra debt, redeem
$144 million of Eschelon debt, and pay about $75 million of
accrued interest, tender costs, and transaction fees.  S&P will
withdraw the rating on Eschelon after its acquisition by Integra,
which is due to close on Aug. 31, 2007.  Total debt should be
about $1.3 billion on an operating lease-adjusted basis.
     
The ratings on Integra reflect a high degree of business risk and
a highly leveraged financial risk profile.  Integra's vulnerable
business risk profile is typical of the CLEC industry due to
significant competition from larger and better-capitalized
incumbents.  It also reflects a lack of any sustainable
competitive advantages, low barriers to entry, integration risks
from the acquisition of Eschelon, and exposure to potential
regulatory changes.  Tempering factors include reasonable
prospects for healthy discretionary cash flow generation, the
potential for meaningful operating synergies, long average
customer contract durations, and regional density.
     
Following the Eschelon transaction, Integra will provide
integrated telecommunications services to approximately 124,000
small and midsize enterprise customers in 11 states in the Western
U.S. primarily through unbundled network elements leased from the
incumbent local exchange carrier.


INTEGRAL NUCLEAR: Exclusive Plan Filing Period Moved to Dec. 11
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey extended
Integral Nuclear Associates LLC and its debtor-affiliates'
exclusive periods to:

   a) file a plan of reorganization until Dec. 11, 2007; and

   b) solicit acceptances to that plan until Feb. 9, 2008.

The Debtors' exclusive period to file a plan expired on Aug. 13,
2007.

The Court noted that the extension is without prejudice to the
Debtors' right to sekk further extensions of the exclusive
periods.

Based in Paoli, Pennsylvania, Integral Nuclear Associates LLC --
http://www.integralpet.com/-- operates nuclear imaging centers.
The company and 25 of its affiliates filed for Chapter 11
protection on April 15, 2007 (Bankr. D. N.J. Case Nos. 07-15183
through 07-15215).  Ilana Volkov, Esq., and Michael D. Sirota,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., represent
the Debtors.  Lawyers at Norris McLaughlin & Marcus, PA, represent
the Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they listed estimated
assets and debts of $1 million to $100 million.


INTERFACE INC: To Redeem Outstanding 7.3% Sr. Notes on Sept. 29
---------------------------------------------------------------
Interface Inc. will redeem all of its outstanding 7.3% Senior
Notes.  The Notes, originally scheduled to mature on April 1,
2008, will be redeemed on Sept. 29, 2007, or an earlier date that
is satisfactory to the trustee for the Notes.

The current aggregate principal amount of the Notes outstanding is
approximately $72 million.  As provided in the Notes, the
redemption price will be an amount equal to the sum of the
discounted present values of the remaining scheduled payments
under the Notes, plus accrued interest.

Headquartered in Atlanta, Georgia, Interface Inc. (NASDAQ: IFSIA),
-- http://www.interfaceinc.com/-- is a manufacturer of modular  
carpet under the Interface, InterfaceFLOR, Heuga, Bentley
and Prince Street brands, Bentley Mills and Prince Street brands.
The company is a also a producer of interior fabrics and
upholstery products, which it markets under the Guilford of Maine
and Chatham brands, and provides specialized fabric services
through its TekSolutions business.

                          *     *     *

As reported in the Troubled Company Reporter on June 26, 2007,
Standard & Poor's Ratings Services placed its ratings on Interface
Inc., including the 'B' corporate credit rating, on CreditWatch
with positive implications.


JRH HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: J.R.H. Holdings, Inc.
        dba Woodfield Inn
        P.O. Box 1307
        Flat Rock, NC 28731

Bankruptcy Case No.: 07-10556

Type of business: The Debtor operates an inn that is also
                  registered in the National Register of Historic
                  Places.  See http://www.woodfieldinn.com/

Chapter 11 Petition Date: August 16, 2007

Court: Western District of North Carolina (Asheville)

Judge: George R. Hodges

Debtor's Counsel: Edward C. Hay, Jr., Esq.
                  Pitts, Hay & Hugenschmidt, P.A.
                  137 Biltmore Avenue
                  Asheville, NC 28801
                  Tel: (828) 255-8085
                  Fax: (828) 251-2760

Total Assets: $4,528,939

Total Debts:  $3,873,076

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Eric Myers Irrevocable Trust                             $803,292
P.O. Box 1307
Flat Rock, NC 28275

Sysco                                                     $39,000
P.O. Box 96
Concord, NC 28026

N.C. Department of Revenue                                $30,000
P.O. Box 1168
Raleigh, NC 27602

Hendersonville Water & Sewer                              $10,648

Henderson County Tax           occupancy tax               $4,000
Collector

P.S.N.C. Energy                                            $4,000

Xerox Capital                                              $2,683

Inland Seafood                                             $2,565

Bell South Advertising                                     $2,464

Amazon.com                                                 $2,419

U.S. Food Service                                          $2,111

M.E.P.C.O. Insurance                                       $2,070

Fischer Publications                                       $1,949

Asheville Citizen Times                                    $1,750

Isurity                                                    $1,694

Planet Zeus Media                                          $1,468

Plus Linen & Uniform Service                               $1,421

Carolina Cot Retail                                        $1,301

Village of Flat Rock                                       $1,200

I.C.I. Paints                                              $1,027


K.X.D. TECHNOLOGY: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: K.X.D. Technology, Inc.
        dba Astar Electronics
        5101 Commerce Drive
        Baldwin Park, CA 91706

Bankruptcy Case No.: 07-17054

Type of business: The Debtor manufactures household audio & video
                  equipment.  See http://www.astarelectronics.com

Chapter 11 Petition Date: August 15, 2007

Court: Central District Of California (Los Angeles)

Judge: Richard M. Neiter

Debtor's Counsel: Jeremy Faith, Esq.
                  Robinson, Diamant & Wolkowitz, A.P.C.
                  1888 Century Park East, Suite 1500
                  Los Angeles, CA 90067
                  Tel: (310) 277-7400
                  Fax: (310) 277-7584

Estimated Assets: More than $100 Million

Estimated Debts:  More than $100 Million

Debtor's 18 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Shenzhen K.X.D. Multimedia     trade                   $6,134,599
Co, Ltd.
37 F. Development Center
Building
Shenzhen, China 518001

L.G. North America, Inc.       trade                   $6,035,002
5719 Oak Avenue, Suite 380
Temple City, CA 91780

C.H. Robinson Worldwide,       freight                    $33,010
Inc.
P.O. Box 9121
Minneapolis, MN 55480                
                                 
Menesq Partners, L.L.C.        rent                       $22,441

A.B.F. Freight System, Inc.    freight                    $17,272

American Express               credit card                 $8,615

Pengo, Inc.                    trade                       $6,908

Global E-Logistics, Inc.       freight                     $6,755

Command Freight System         freight                     $6,755

Health Net                     health insurance            $6,306

Huijin Sun                     rent                        $5,535

Pacific Century Customs        customs service             $3,808
Service

Southern California Edison     utility                     $1,993

Blue Cross of California       health insurance            $1,460

Hartford Casualty Insurance    product insurance           $1,343

Uline Shipping Supply          warehouse supply            $1,318
Specials

U.S. Philips Corporation       alleged patent            disputed
                               infringement

Koninklijke Philips            alleged patent            disputed
Electronics, N.V.              infringement


LEVEL 3: Douglas Eby and Michael Mahoney Joins Board of Directors
-----------------------------------------------------------------
Douglas C. Eby and Michael J. Mahoney have been elected to Level 3
Communications, Inc.'s Board of Directors effective Aug. 16, 2007.

Mr. Eby, 48, is chairman and CEO of TimePartners LLC, an
investment advisory firm.  He also serves as president of Torray
LLC, an independent money management firm.  Mr. Eby sits on the
Boards of Directors of Markel Corporation, CBRE Realty Finance,
Inc. and Suburban Healthcare System.

Mr. Mahoney, 57, was most recently the president and CEO of
Commonwealth Telephone Enterprises.  A telecommunications industry
veteran, he was also president and COO of RCN Corporation,
president and COO of C-TEC Corporation, and executive vice
president and general manager of C-TEC Cable Systems.  Mr. Mahoney
sits on the Board of Trustees of Wilkes University.

“We are pleased to welcome Doug Eby and Mike Mahoney to the Level
3 board,” Walter Scott Jr., chairman of Level 3, said.  “Both men
have built long and distinguished careers in their respective
fields.  Doug is highly regarded in the financial community and we
expect to benefit from his knowledge and insight to the financial
markets.  Mike has broad experience and knowledge of the
telecommunications industry, and he will bring a valuable
perspective to the company.”

Both Mr. Eby's and Mr. Mahoney's Level 3 board terms will expire
at the Annual Meeting of Stockholders in 2008.  With these
additions, the Level 3 board will have 11 directors.

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.


LEVI STRAUSS: Moody's Affirms B1 Corporate Family Rating
--------------------------------------------------------
Moody's Investors Service affirmed all ratings for Levi Strauss &
Co.  The rating outlook was revised to positive from stable.

"The change in the rating outlook to positive reflects LS&CO's
continued progress in achieving revenue and margin stability for
the company as a whole and continued improvement in its balance
sheet with about $200m of funded debt repaid in the past 18
months" said Scott Tuhy, Vice President and Senior Analyst.  
Upward rating momentum would result from the company demonstrating
continued stability in operating performance and credit metrics in
the face of current uncertainties in consumer spending, as well as
further progress in improving internal controls and systems.

These ratings were affirmed:

-- Corporate Family Rating and Probability of Default Rating
    – B1

-- Various Senior Unsecured Notes: B2 (LGD 4 -- 62%).

San Francisco, CA based Levi Strauss & Co. markets apparel
products in more than 110 countries primarily under the "Levi's",
"Dockers" and "Levi Strauss Signature" brands.  The company had
global net revenues of about $4.2 billion in its fiscal year
ending Nov. 26, 2006.


NEPHROS INC: June 30 Balance Sheet Upside-Down by $5.0 Million
--------------------------------------------------------------
Nephros Inc. reported on Aug. 13, 2007, its financial results for
the three and six month periods ended June 30, 2007.

At June 30, 2007, the company's consolidated financial statements
for the quarter ended June 30, 2007, showed $2.4 million in total
assets, $7.4 million in total liabilities, and $5.0 million in
total stockholders' deficit.

The company's consolidated balance sheet at June 30, 2007, also
showed strained liquidity with $1.6 million in total current
assets available to pay $1.8 million in total current liabiities.

The company's net loss was $1.6 million for the second quarter of
2007 versus a net loss of $2.2 million in the second quarter of
2006.  The company's net loss was reduced in the current quarter
as a result of higher gross profit on higher sales levels and
lower operating costs, offset by the interest expense related to
the convertible notes issued by the company in June 2006.

For the quarter ended June 30, 2007, Nephros reported net product
revenues of $348,000, attributable to sales of its OLpūr MD190 and
MD220 products in Europe, compared with $302,000 in the
corresponding period of 2006, an increase of 15%.

Net product revenues for the six months ended June 30, 2007, were
$644,000 compared to $476,000 in the corresponding period of 2006.
The company's net loss was $3.2 million for the six months ended
June 30, 2007, compared with a net loss of $3.9 million for the
corresponding period of 2006.

As of June 30, 2007, Nephros had cash, cash equivalents and short-
term investments of $530,000.  

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?2294

      Default on Third Installment on Settlement Agreement

In addition, as reported in the Troubled Company Reporter on
Aug. 9, 2007, the company disclosed that it received on July 23,
2007, a letter from representatives of Marty Steinberg, Esq., as
Receiver for Lancer Offshore Inc.., notifying it of its failure to
pay the third installment under the Settlement entered into on
Nov. 8, 2005, between the Receiver and the company.  

The letter also asked the company to cure the default by July 30,
2007.  If the Receiver files a Certificate of Default and the
company is unable to obtain additional financing, it would
significantly impact the company's ability to execute its cash
management program and the company could have to curtail its
planned activities or cease its operations.  

                      Going Concern Doubt
    
As reported in the Troubled Company Reporter on April 20, 2007,
Deloitte & Touche LLP expressed substantial doubt about Nephros
Inc.'s ability to continue as a going concern after auditing the
company's financial statements for the years ended Dec. 31, 2006,
and 2005.  The auditing firm pointed to the company's recurring
losses and difficulty in generating sufficient cash flow to meet
its obligations and sustain its operations.

                       About Nephros Inc.

Headquartered in New York, Nephros Inc. (Amex: NEP) --
http://www.nephros.com/-- is a medical device company developing  
and marketing products designed for the End-Stage Renal Disease
(ESRD) patient.  Nephros also markets a line of water filtration
products, the Dual Stage Ultrafilter (DSU).


MERRILL LYNCH: S&P Assigns Default Rating on Class H Certificates
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its rating on the class
E commercial mortgage pass-through certificates from Merrill Lynch
Mortgage Investors Inc.'s series 1997-C2.  Concurrently, S&P
lowered its rating on class H to 'D' from 'CCC+' and affirmed its
ratings on the remaining three classes from this transaction.
     
The raised and affirmed ratings reflect increased credit
enhancement levels that provide adequate support through various
stress scenarios.  The ratings are constrained by the reduced
pooling effect, as there are only 34 loans remaining in the trust.
     
The lowered rating reflects credit support erosion following the
liquidation of several specially serviced assets.  Class H
currently has only $700,159 of credit support and has experienced
accumulated interest shortfalls.  The default of one or more
poorly performing loans in the pool may result in additional
interest shortfalls, as well as principal losses to the class.
     
As of the Aug. 10, 2007, remittance report, the collateral pool
consisted of 34 loans with an aggregate trust balance of
$123.6 million, down from 147 loans with a balance of
$686 million at issuance.  The master servicer, Wachovia Bank
N.A., reported primarily full-year 2006 financial information for
98.5% of the pool.  Based on this information and excluding credit
tenant lease loans, Standard & Poor's calculated a weighted
average debt service coverage of 1.41x.  All of the remaining
loans in the pool are current, but one loan totaling $2.1 million
is with the special servicer, CWCapital Asset Management LLC.  The
pool has experienced 16 losses totaling $20.6 million.
     
The top 10 loans secured by real estate have an aggregate
outstanding balance of $80.5 million (65%) and a weighted average
DSC of 1.38x.  Three of the top 10 loans are on the watchlist
because of low DSCs and occupancy issues and are discussed below.  
According to inspection reports received from Wachovia, all
properties were characterized as "good."
     
There is one loan with the special servicer.  The Westover Plaza
Shopping Center ($2.1 million) is secured by a 58,705-sq.-ft.
retail property in Hickory, North Carolina.  The loan was
transferred to CWCapital in June 2004 due to payment default.  The
loan is current on its principal payments; however, the borrower
is in default for not paying leasing reserve escrows, outstanding
default interest, and property protection advances.  As of May
2007, the borrower had a new tenant that planned to take over the
anchor space previously occupied by Lowe's Food Stores. This loan
has an anticipated repayment date of Nov. 1, 2007.
     
Wachovia reported a watchlist of 14 loans ($43.7 million, 35.4%).  
The fifth-largest exposure ($7.3 million, 5%), Courtyard -
Waterbury, is secured by a 199-room full-service hotel in
Waterbury, Connecticut.  The loan is on the watchlist due to a
decline in DSC.  As of year-end 2006, DSC was 1.08x and average
daily occupancy was 62%.  This loan has an ARD of Dec. 1, 2007.  
     
The seventh-largest exposure ($5.7 million, 4%), Hunt Club, is
secured by a 395-unit multifamily property in Huntsville, Alabama.  
This loan is on the watchlist due to a low DSC.  As of year-end
2006, the property reported a DSC of 0.39x and 57% occupancy.
     
The ninth-largest exposure ($4.6 million, 3%), Cheron Village, is
secured by a 205-unit manufactured housing community in Davie,
Fla.  The loan is on the watchlist due to a decline in occupancy
after the property suffered hurricane damage.  As of year-end
2006, the DSC was 1.3x and occupancy was 66%.
     
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, lowered, and
affirmed ratings.


Rating Raised

Merrill Lynch Mortgage Investors Inc.
           Commercial mortgage pass-through certificates
                          series 1997-C2

                       Rating
                       ------
           Class   To         From    Credit enhancement
           -----   --         ----     ----------------
           E       AA         AA-           46.38%
   
Rating Lowered

Merrill Lynch Mortgage Investors Inc.
          Commercial mortgage pass-through certificates
                          series 1997-C2   

                        Rating
                        ------
           Class    To         From   Credit enhancement
           -----    --         ----    ----------------
           H        D          CCC+         0.57%
   
Ratings Affirmed

Merrill Lynch Mortgage Investors Inc.
Commercial mortgage pass-through certificates
series 1997-C2
   
               Class    Rating   Credit enhancement
               -----    ------    ----------------
               C        AAA                       83.86
               D        AA+                       56.10
               F        BB+                       15.84


MERRILL LYNCH: Fitch Assigns Low-B Ratings on Six Cert. Classes
---------------------------------------------------------------
Merrill Lynch Mortgage Trust 2007-C1, commercial mortgage pass-
through certificates are rated by Fitch Ratings as:

  -- $57,041,000 class A-1 'AAA';
  -- $298,918,000 class A-2 'AAA';
  -- $200,000,000 class A-2FL 'AAA';
  -- $322,217,000 class A-3 'AAA';
  -- $130,000,000 class A-3FL 'AAA';
  -- $90,343,000 class A-SB 'AAA';
  -- $442,207,000 class A-4 'AAA';
  -- $1,294,430,000 class A-1A 'AAA';
  -- $405,023,000 class AM 'AAA';
  -- $134,143,000 class AJ 'AAA';
  -- $200,000,000 class AJ-FL 'AAA';
  -- $4,050,224,260 class X Interest-Only 'AAA';
  -- $86,068,000 class B 'AA';
  -- $40,502,000 class C 'AA-';
  -- $45,565,000 class D 'A';
  -- $45,565,000 class E 'A-';
  -- $50,628,000 class F 'BBB+';
  -- $40,502,000 class G 'BBB';
  -- $40,502,000 class H 'BBB-';
  -- $15,189,000 class J 'BB+';
  -- $15,188,000 class K 'BB';
  -- $10,125,000 class L 'BB-';
  -- $10,126,000 class M 'B+';
  -- $10,126,000 class N 'B';
  -- $5,062,000 class P 'B-'.
   
This class is not rated by Fitch:
  -- $60,754,260 class Q.

Classes A-1, A-2, A-3, A-SB, A-4, A-1A, AM, AJ, B,C, and D are
offered publicly, while classes A-2FL, A-3FL, AJ-FL, E, F, G, H,
J, K, L, M, N, O, P, Q, 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 265 fixed-rate loans having an aggregate
principal balance of approximately $4,050,224,261, as of the
cutoff date.


MERITAGE HOMES: Moody's Lowers Corporate Family Rating to Ba3
-------------------------------------------------------------
Moody's Investors Service lowered the ratings of Meritage Homes
Corporation, including the company's corporate family rating to
Ba3 from Ba2 and senior notes ratings to Ba3 from Ba2.  The
ratings outlook was changed to negative from stable.

The downgrade reflects Moody's expectation that:

   i. the company's cash flow generation will be negative in 2007
      as the company has been unable thus far to reduce inventory  
      at the same rate as sales have declined.  For the trailing
      twelve month period ended June 30, 2007, the company's cash
      flow from operations was a negative $135 million, making it
      one of only a handful of companies that is still generating
      negative cash flow on a trailing twelve month basis;

  ii. the company may violate its 2 times bank interest coverage
      covenant and may need to seek an amendment; and

iii. the company will need to rely on its $850 million revolving
      credit facility all through 2007 and 2008.

The negative outlook reflects Moody's expectation that
homebuilding market conditions will continue to be difficult
throughout 2007 and 2008, thus pressuring the company's credit
metrics, particularly interest coverage, gross margins, and return
on assets.  In addition, while the company still has considerable
headroom under its debt leverage covenant, large impairment and
option abandonment charges could make complying with the covenant
challenging in 2008.

The ratings also consider the company's limited geographic reach,
as it operates only in six states, and its growing concentration
in Texas (43% of revenues for the six months ended June 30, 2007).
Further, the ratings incorporate the financial and integration
risks associated with Meritage's acquisition-based growth strategy
and the company's heavy reliance on options in general as well as
on land banking options in particular.

The ratings are supported by the longer-term strength of
Meritage's markets (Arizona, Texas, and California, Las Vegas,
Nevada and Florida) and relatively low owned land supply.

Going forward, the company's outlook could stabilize if Moody's
were to project that Meritage will generate strongly positive cash
flow from operations and use the cash flow to pay down debt.  This
would reduce the company's interest burden and widen the headroom
under its interest coverage covenant as well as protect the
cushion under the debt leverage covenant.  

The ratings could be lowered again if any of the following were to
occur:

   i. Moody's were to expect negative cash flow generation to
      continue for full year 2008;

  ii. Meritage were to generate modest quarterly pre-impairment
      losses on a sustained basis or significant pre-impairment
      losses in any one quarter;

iii. the company were to make significant share repurchases;

  iv. Moody's were to anticipate that the company will have
      difficulty in obtaining amendments from the bank group; or

   v. the company were to re-lever its balance sheet to above 55%.

These rating actions were taken:

-- Corporate family rating downgraded to Ba3 from Ba2;

-- Probability of default rating downgraded to Ba3 from Ba2;

-- Senior notes downgraded to Ba3 (LGD-4, 53%) from Ba2 (LGD-4,
    58%).

The LGD rate of 53% benefited from Meritage's recent issuance of
$150 million of senior sub notes (unrated by Moody's).

Meritage Homes Corporation is the 13th largest homebuilder in the
U.S., primarily building attached and detached single-family homes
in 14 metropolitan areas in Arizona, Texas, California, Nevada,
Colorado, and Florida.  Formerly known as Meritage Corporation,
the company was founded in 1985 and is headquartered in
Scottsdale, Arizona.  Homebuilding revenues and consolidated net
income for the trailing 12-month period ended June 30, 2007 were
about $2.8 billion and $27 million, respectively.


MITEL NETWORKS: Zarlink Sells Equity Interest for $12.9 Million
---------------------------------------------------------------
Zarlink Semiconductor Inc. reported Thursday that it has sold its
Mitel Networks Corporation shares for $12.9 million, following the
approval of the merger of Mitel and Inter-Tel (Delaware)
Incorporated.

Zarlink obtained ownership of 10 million common shares of Mitel
through the sale of its systems business in fiscal 2001.  In
fiscal 2002, Zarlink acquired a put right on its shares as a
result of conditions obtained by a new investor in Mitel.

On June 4, 2007, Zarlink and other put right holders agreed to an
amendment to the put right as a result of Mitel's announced
proposed merger with Inter-Tel and associated refinancing
arrangements.

As provided in the amended put right, Zarlink received payment
from Mitel of $1.29 per share.  The $12.9 million in proceeds
received through the sale of this investment results in an
additional $0.10 earnings per share for the second quarter fiscal
2008 as the Mitel shares were carried on Zarlink's books at no
value.  In light of the payment and the company's recent
acquisition of Legerity, Zarlink will be issuing revised guidance
for the second quarter fiscal 2008 within the next week.

                   About Zarlink Semiconductor

Zarlink Semiconductor -- http://www.zarlink.com/-- delivers  
semiconductor solutions that drive the capabilities of voice,
enterprise, broadband and wireless communications.  The company's
has been in operations for over 30 years.

                      About Mitel Networks

Headquartered in Ottawa, Ontario, Mitel Networks Corporation --
http://www.mitel.com/-- provides integrated internet protocol   
based enterprise telephony solutions for small and medium sized
businesses.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 1, 2007,
Moody's Investors Service revised Mitel Network Corporation's
first lien senior secured rating to B1 from Ba3 and second lien
senior secured rating to Caa1 from B3.  The B2 corporate family
rating remains unchanged.  The outlook is stable.

Standard & Poor's Ratings Services revised its bank loan and
recovery ratings on Mitel Networks Corp.'s proposed $460 million
senior secured credit facility.  The bank loan rating on Mitel's
proposed $330 million first-lien credit facility has been revised
to 'B+', with a recovery rating of '2', from 'BB-', with a
recovery rating of '1'.  The '2' recovery rating reflects S&P's
expectation of substantial (70%-90%) recovery of principal in a
default scenario.


MITEL NETWORKS: Completes Merger Transaction with Inter-Tel Inc.
----------------------------------------------------------------
Mitel Networks Corporation and Inter-Tel (Delaware) Incorporated
have completed their merger.  As a result of the merger, Inter-Tel
is now a wholly-owned subsidiary of Mitel(R) and Inter-Tel
stockholders will receive $25.60 in cash for each Inter-Tel share
they held prior to the closing.
    
“We are delighted to complete our merger with Inter-Tel,” Don
Smith, CEO of Mitel, said.  “Inter-Tel's people, products, managed
services and partnerships complement those at Mitel and will
enable us to accelerate our growth strategy by extending our
small/medium business leadership position and continuing our
expansion into the large business sector.”
    
With three brands, Mitel, Inter-Tel and Lake, the company offers
customers a broad choice of solutions from the small to the large,
from IP enabled to pure IP unified communications, from standard
solutions to tailored, from single site to multi-site and from
outright capital purchase options through sophisticated managed
services.
    
“We are extremely pleased to complete this transaction today,
which we believe is in the best interests of Inter-Tel
stockholders,” Norman Stout, CEO of Inter-Tel, said.  “Our new
company will be a formidable industry player in the U.S. and
across the globe, and as part of the Mitel team, we look forward
to continuing to provide exceptional products and services to
our mutually expanded customer base.”
    
Mitel will maintain Inter-Tel's Arizona headquarters, which will
become the center of operations for the combined U.S. business and
serve as an important center of R&D excellence.
    
“We have common entrepreneurial roots, a shared vision and the
breadth of solutions and technology to address the diverse needs
of the rapidly changing communications market.” Mr. Smith
concluded.  “As we come together we will deliver innovative
solutions and managed services for our existing customers and
channel partners, so that no one is stranded or forced to
consider an alternate vendor.  We intend to be the logical choice
for both existing and new customers.”
    
As a result of the acquisition, Inter-Tel common stock will no
longer be listed on the NASDAQ Stock Market from Aug. 16, 2007.
    
             About Inter-Tel (Delaware) Incorporated

Headquartered in Tempe, Arizona, Inter-Tel (Delaware) Incorporated
(Nasdaq: INTL) -- http://www.inter-tel.com/-- has grown from   
providing simple business telephone systems, to offering value-
driven communications products; applications utilizing networks
and server-based communications software; and a wide range of
managed services that include voice and data network design and
traffic provisioning, custom application development and financial
solutions.  Founded in 1969 by Steven G. Mihaylo, Inter-Tel
employs over 1,900 communications professionals, and services
business customers through a network of 59 company-owned, direct
sales offices and over 350 authorized providers in North America
and 60 resellers in Europe.

                About Mitel Networks Corporation

Headquartered in Herndon, Virginia, Mitel Networks Corporation --
http://www.mitel.com/-- delivers the full value of IP  
Communications through networked business solutions that help
customers achieve success through business process integration,
enhanced employee productivity, increased customer loyalty and
helping to generate new revenue streams.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 1, 2007,
Moody's Investors Service revised Mitel Network Corporation's
first lien senior secured rating to B1 from Ba3 and second lien
senior secured rating to Caa1 from B3.  The B2 corporate family
rating remains unchanged.  The outlook is stable.

Standard & Poor's Ratings Services revised its bank loan and
recovery ratings on Ottawa, Ontario-based business communications
solutions provider Mitel Networks Corp.'s proposed $460 million
senior secured credit facility.  The bank loan rating on Mitel's
proposed $330 million first-lien credit facility has been revised
to 'B+', with a recovery rating of '2', from 'BB-', with a
recovery rating of '1'.  The '2' recovery rating reflects S&P's
expectation of substantial (70%-90%) recovery of principal in a
default scenario.

As reported in the Troubled Company Reporter on June 22, 2007,
Standard & Poor's Ratings Services assigned its 'B' long-term
corporate credit rating to Ottawa-based Mitel Networks Corp.  The
outlook is stable.


ML-CFC COMMERCIAL: Fitch Holds Low-B Ratings on Six Cert. Classes
-----------------------------------------------------------------
Fitch Ratings has affirmed ML-CFC Commercial Mortgage Trust's
2006-1, commercial mortgage pass-through certificates, as:

  -- $48.5 million class A-1 at 'AAA';
  -- $337.5 million class A-2 at 'AAA';
  -- $66.1 million class A-3 at 'AAA';
  -- $105.1 million class A-3FL at 'AAA';
  -- $75 million class A-3B at 'AAA';
  -- $121 million class A-SB at 'AAA';
  -- $489.5 million class A-4 at 'AAA';
  -- $240 million class A-1A at 'AAA';
  -- $214.2 million class AM at 'AAA';
  -- $82.1 million class AJ at 'AAA';
  -- $100 million class AN-FL at 'AAA';
  -- Interest-only class X at 'AAA';
  -- $50.9 million class B at 'AA';
  -- $21.4 million class C at 'AA-';
  -- $29.4 million class D at 'A';
  -- $16.1 million class E at 'A-';
  -- $24.1 million class F at 'BBB+';
  -- $16.1 million class G at 'BBB';
  -- $26.8 million class H at 'BBB-';
  -- $5.4 million class J at 'BB+';
  -- $5.4 million class K at 'BB';
  -- $8.0 million class L at 'BB-';
  -- $2.7 million class M at 'B+';
  -- $8.0 million class N at 'B';
  -- $5.4 million class P at 'B-'.

Fitch does not rate the $26.8 million class Q.

The rating affirmations reflect stable performance, scheduled
amortization and the prepayment of three loans since issuance.  As
of the August 2007 remittance report the transaction has paid down
1% to $2.12 billion from $2.14 billion at issuance.

Currently one loan (0.4%), secured by an office property in
Norfolk, VA, is in special servicing.  The loan transferred to the
special servicer due to payment default and is 60 days delinquent.  
The special servicer is working with the borrower to bring the
loan current.

Three loans (13.5%) are credit assessed by Fitch: Kenwood Towne
Centre (6.8%), 60 State Street (6.1%) and Southern California
Ground Leases (0.6%).  Based on their stable performance since
issuance the loans maintain their investment grade credit
assessments.

The Kenwood Towne Center loan is secured by 867,504 square feet of
in-line space within a 1.13 million sf regional mall in
Cincinnati, OH.  As of March 31, 2007, in-line occupancy at the
property is 95.8% compared to 98.8% at issuance.

The 60 State Street loan is secured by an 823,014 sf office
building in Boston, MA.  Major tenants include Wilmer Cutler
Pickering Hale & Dorr and The Pioneering Group.  Occupancy as of
March 31, 2007, has increased to 100% from 98% at issuance.

The Southern California Ground Leases loan is secured by the
ground leases of four industrial properties located in Los
Angeles, Brea, and Culver City, CA.  Occupancy at the properties
as of year-end 2006 has remained stable at 100% since issuance.


MORGAN STANLEY: Fitch Affirms B- Rating on $4MM Class O Certs.
--------------------------------------------------------------
Fitch Ratings has affirmed Morgan Stanley Capital I Trust's
commercial mortgage pass-through certificates, series 2006-TOP23,
as:

  -- $85.1 million class A-1 at 'AAA';
  -- $151.8 million class A-2 at 'AAA';
  -- $43.6 million class A-3 at 'AAA';
  -- $76.3 million class A-AB at 'AAA';
  -- $812.1 million class A-4 at 'AAA';
  -- $161.4 million class A-M at 'AAA';
  -- $113 million class A-J at 'AAA';
  -- Interest-only class X at 'AAA';
  -- $32.3 million class B at 'AA';
  -- $16.1 million class C at 'AA-';
  -- $26.2 million class D at 'A';
  -- $14.1 million class E at 'A-';
  -- $12.1 million class F at 'BBB+';
  -- $14.1 million class G at 'BBB';
  -- $10.1 million class H at 'BBB-';
  -- $4 million class J at 'BB+';
  -- $4 million class K at 'BB';
  -- $6.1 million class L at 'BB-';
  -- $4 million class M at 'B+';
  -- $2 million class N at 'B';
  -- $4 million class O at 'B-'.
  
Fitch does not rate the $12.1 million class P certificates.

The affirmations reflect scheduled amortization and stable
performance since issuance.  As of the July 2007 distribution date
the transaction's outstanding principal balance has been reduced
by 0.6% to $1.60 billion from $1.61 billion at issuance.  There
are currently no delinquent or specially serviced loans.

Fitch reviewed year-end 2006 operating statement analysis reports
for the transaction's eleven credit assessed loans: Beachwood
Place Mall (9.2%), Hamilton Place Mall (7.2%), Nokia Building
(2.0%), Dimond Center Regional Mall (1.3%), Savannah Crossings I &
II (1.1%), 14401 County Road 212 (1.1%), Perlmutter - Mesa 8
(0.8%), Addison Shopping Center (0.6%), Marketplace at
Collegeville (0.6%), Metro Pointe Retail (0.5%) and 890 Broadway
(0.5%).  Based on their stable performance since issuance the
loans maintain their investment grade credit assessments.

The Beachwood Place Mall loan (9.2%) is collateralized by 348,459
square feet of a 912,806 sf regional mall in the Beachwood, OH.  
The mall benefits from the experienced sponsorship of General
Growth Properties.  The pari-passu A-1 and A-2 notes are included
in this transaction.  The subordinate B and C notes are held
outside the trust.  As of YE 2006 occupancy has increased to 97%
from 96% at issuance.

The Hamilton Place Mall loan (7.2%) is collateralized by 364,188
sf of a 1.1 million sf regional mall in Chattanooga, TN.  The mall
benefits from the experienced sponsorship of CBL & Associates
Properties Inc.  As of March 31, 2007 occupancy has increased to
98.6% from 97.5% at issuance.


MORGAN STANLEY: Stable Performance Cues Fitch to Affirm Ratings
---------------------------------------------------------------
Fitch Ratings affirms Morgan Stanley Capital I Trust 2005-HQ6 as:

  -- $87 million class A-1 at 'AAA';
  -- $315.5 million class A-1A at 'AAA';
  -- $294.9 million class A-2A at 'AAA';
  -- $42.1 million class A-2B at 'AAA';
  -- $103 million class A-3 at 'AAA';
  -- $111.1 million class A-AB at 'AAA';
  -- $1,060.6 million class A-4A at 'AAA';
  -- $151.5 million class A-4B at 'AAA';
  -- Interest-only classes X-1 and X-2 at 'AAA';
  -- $175.6 million class A-J at 'AAA';
  -- $24.1 million class B at 'AA+';
  -- $34.4 million class C at 'AA';
  -- $27.5 million class D at 'AA-';
  -- $24.1 million class E at 'A+';
  -- $27.5 million class F at 'A';
  -- $27.5 million class G at 'A-';
  -- $34.4 million class H at 'BBB+';
  -- $31.0 million class J at 'BBB';
  -- $41.3 million class K at 'BBB-';
  -- $10.3 million class L at 'BB+';
  -- $10.3 million class M at 'BB';
  -- $17.2 million class N at 'BB-';
  -- $3.4 million class O at 'B+';
  -- $10.3 million class P at 'B';
  -- $10.3 million class Q at 'B-'.
  
Fitch does not rate the $41.3 million class S.

The rating affirmations reflect stable performance and minimal
paydown of the transaction since issuance.  As of the August 2007
remittance report, the pool's collateral balance has paid down
1.4% to $2.72 million from $2.75 million at issuance.

Currently there is one loan in special serving, which is secured
by a 165-room hotel in New Orleans, LA.  The loan was initially
transferred to the special servicer in November 2005 due to
delinquency and was returned to the master servicer in July 2006.  
It was transferred to the special servicer recently due to
imminent default.  The loan is now current.

Fitch reviewed the credit assessments of Coronado Center (4.6%)
and FRIS Portfolio (0.9%).  Both loans maintain investment grade
credit assessments based on their stable performance.

The Coronado Center loan is secured by a regional mall located in
Albuquerque, NM.  The collateral consists of 526,651 square feet
of a total 1,152,708 sf.  As of 2Q07, occupancy improved to 96%
from 91% at issuance.

The FRIS Portfolio loan is secured by 192 Church's Chicken quick
service restaurants located in various cities throughout 12 states
totaling 245,175 sf.  All properties are under a single master
lease expiring December 2024.  As of 2Q07, four restaurants
remained closed and the tenant is still paying rent on these
locations.


MORTGAGE CAPITAL: Moody's Junks Rating on Class J Certificates
--------------------------------------------------------------
Moody's Investors Service upgraded the rating of one class and
affirmed the ratings of nine classes of Mortgage Capital Funding,
Inc., Multifamily/Commercial Mortgage Pass-Through Certificates,
Series 1998-MC3 as:

-- Class A-2, $156,002,362, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class B, $40,867,000, affirmed at Aaa
-- Class C, $43,138,000, affirmed at Aaa
-- Class D, $61,301,000, affirmed at Aaa
-- Class E, $29,515,000, affirmed at A1
-- Class F, $20,433,000, upgraded to Baa3 from Ba1
-- Class G, $20,434,000, affirmed at B1
-- Class H, $6,811,000, affirmed at B3
-- Class J, $20,410,412, affirmed at Ca

As of the July 18, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by about 56.1% to
$398.9 million from $908.2 million at securitization.  The
certificates are collateralized by 108 mortgage loans ranging in
size from less than 1% to 11% of the pool, with the top 10 loans
representing 31.7% of the pool.  Thirteen loans, representing
15.4% of the pool, have defeased and are collateralized by U.S.
Government securities.

Nine loans have been liquidated from the trust, resulting in
aggregate realized losses of about $34.1 million.  This included
the former largest loan in the pool known as the Kranzco Portfolio
Loan ($59.8 million), which was secured by nine retail centers and
was in special servicing at the time of the last review.

Four loans, representing 2.4% of the pool, are in special
servicing.  Moody's is estimating $1.9 million of losses from all
of the specially serviced loans.  Twenty-seven loans, representing
20.7% of the pool, are on the master servicer's watchlist.

Moody's was provided with full-year 2006 operating results for
about 88.5% of the pool's performing loans.  Moody's loan to value
ratio is 76.9%, compared to 91.6% at Moody's last full review in
September 2006 and compared to 83.8% at securitization.  Moody's
is upgrading Class F due to increased credit subordination levels,
improved overall pool performance and defeasance.

The top three loans represent 18.7% of the outstanding pool
balance.  The largest loan in the pool is the Oceanside
Kohl's/Gold Coast Plaza and Swan Nursery Commons Loan
($43.7 million -- 11%), which is secured by two anchored retail
centers located in Oceanside and East Patchouge (Nassau County),
New York.  The two centers total 391,000 square feet and are
100.0% occupied, compared to 96% at securitization.  Property
performance has improved since last review due to increased rents,
stable expenses and loan amortization.  Moody's LTV is 78.2%,
compared to 82.8% at last review and compared to 80% at
securitization.

The second largest loan in the pool is the Shrewsbury Commons Loan
($15.6 million - 3.9%), which is secured by a community shopping
center located in Shrewsbury, Pennsylvania.  Built in 1997, the
center contains 218,000 square feet.  The center is 100% occupied,
essentially the same as at last review and at securitization.  The
loan has amortized by about 10.5% since securitization.  Moody's
LTV is 82.4%, compared to 86.1% at last review and compared to 90%
at securitization.

The third largest loan in the pool is the 515 22nd Street Loan
($15 million - 3.8%), which is secured by a 102,080 square foot
office building located in Washington, D.C.  The center is 100%
occupied, the same as at last review and at securitization.  The
building is 100% leased to the United States of America
(Department of State) through November 2007.  GSA tenants have
occupied this property since its construction in 1941.  The loan
matures in January 2008.  The loan has amortized by about 28.7%
since securitization.  The loan is on the master servicer's
watchlist due to low debt service coverage and the approaching
lease expiration.  Moody's LTV is 63%, compared to 66.5% at last
review and compared to 77% at securitization.


MOUI TRAN: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: Moui Tran
        Hue To
        572 Tarryton Isle
        Alameda, CA 94501

Bankruptcy Case No.: 07-42585

Type of Business: The Debtors' partner, Saigon Plaza
                  Associates, filed for Chapter 11 protection
                  on Jan. 18, 2007 (Bankr. N.D. Calif. Case No.
                  07-40169).

Chapter 11 Petition Date: August 16, 2007

Court: Edward D. Jellen

Judge: Northern District of California (Oakland)

Debtors' Counsel: Darya Sara Druch, Esq.
                  1 Kaiser Plaza, Suite 480
                  Oakland, CA 94612
                  Tel: (510) 465-1788

Estimated Assets: $100,000 to $100 Million

Estimated Debts:  $1 Million to $100 Million

The Debtors did not file a list of their 20 largest unsecured
creditors.


MOVIE GALLERY: Extends Forbearance Agreement until August 27
------------------------------------------------------------
Movie Gallery Inc. and certain lenders under its First Lien Credit
Facility have executed an extension of the Forbearance Agreement.
Under the extended agreement, the senior lender group will forbear
until Aug. 27, 2007, from exercising rights and remedies arising
from existing defaults, absent any new defaults under the
senior credit facility or the Forbearance Agreement.
    
“Despite the challenging market conditions for Movie Gallery and
the entire rental industry, we are continuing to work with our
lenders and our outside advisors to help address the company's
current financial situation,” Joe Malugen, chairman, president and
chief executive officer, said.  “We plan to continue to operate
the Company without interruption as we work through this
challenging period.  I would like to thank our customers and our
hard working associates and partners, who continue to remain
faithful to our company."
    
Headquartered in Dothan, Alabama, Movie Gallery Inc. (NasdaqGM:
MOVI) -- http://www.moviegallery.com/-- is second largest North   
American video rental company with more than 4,550 stores located
in all 50 U.S. states and Canada operating under the brands Movie
Gallery, Hollywood Video and Game Crazy.  The Game Crazy brand
represents 606 in-store departments and 14 free-standing stores
serving the game market in urban locations across the Untied
States.  Since Movie Gallery's initial public offering in August
1994, the company has grown from 97 stores to its present size
through acquisitions and new store openings.

Movie Gallery Inc.'s consolidated balance sheet at July 1, 2007,
showed $892.0 million in total assets, $1.45 billion in total
liabilities, resulting in a $560.3 million total stockholders'
deficit.

                          *     *     *

As reported in Troubled Company Reporter on Aug. 16, 2007,  
Standard & Poor's Ratings Services said it lowered its ratings,
including the corporate credit rating, on Movie Gallery Inc. to
'CC' from 'CCC+' based on the company's extremely poor liquidity
position.  At the same time, S&P lowered the ratings on the
company's bank loans and senior unsecured debt to 'CC'.  This
rating level indicates a high vulnerability to nonpayment.  The
outlook has been revised to negative.


MXENERGY HOLDINGS: Ends Offer for Floating Rate Senior Notes
------------------------------------------------------------
MxEnergy Holdings Inc. terminated its previously announced tender
offer from holders of the company's floating rate senior notes due
2011 as of Wednesday, on Aug. 15, 2007.  The tender offer and
consent solicitation were made pursuant to an amended and restated
offer to purchase and consent solicitation statement, dated as of
July 30, 2007, which amended and restated the offer to purchase
and consent solicitation statement, dated as of June 22, 2007, a
supplement to the amended and restated offer to purchase and
consent solicitation statement, dated as of July 31, 2007, and a
letter of transmittal and consent, dated as of June 22, 2007.

The tender offer consideration and consent payment will not be
paid or become payable to holders of the notes who validly
tendered their notes and delivered their consents in connection
with the tender offer and the consent solicitation.

All tendered notes and delivered consents will be returned to the
holders or, in the case of notes tendered by book-entry transfer,
the notes will be credited to the account maintained at The
Depository Trust Company from which the notes were delivered, as
promptly as practicable.

The company has not terminated its offer to exchange $190,000,000
aggregate principal amount of its notes which are registered under
the Securities Act of 1933, as amended, for an equal amount of its
outstanding notes which are not registered under the Securities
Act.  The exchange offer is scheduled to expire at 5:00 p.m., New
York City time, on Friday, Aug. 31, 2007, unless extended, and is
being made pursuant to a prospectus dated Aug. 1, 2007.  Because
the company terminated the tender offer and consent solicitation
prior to the consummation of the exchange offer, the company will
not be obligated to provide holders with the additional
registration rights set forth in the supplemental indenture to the
indenture governing the notes.
Although the supplemental indenture became effective upon its
execution, the proposed amendments to the indenture that:

     (a) eliminate substantially all of the restrictive covenants
         and certain events of default provisions,

     (b) amend certain provisions of the covenants relating to
         mergers and consolidations of the company and the
         guarantors, and

     (c) make related changes in the notes, will not become
         operative because of the company's termination of the  
         tender offer.

Although the company has terminated the tender offer, it reserves
the right to continue discussions relating to its previously
announced auction process.  As of the date hereof, the company has
not completed such auction process.  There can be no assurance
that these discussions will result in a transaction.

                   About MxEnergy Holdings Inc.

Headquartered in Connecticut, MxEnergy Holdings Inc. --
http://www.mxholdings.com/-- is a retail natural gas supplier   
serving more than 500,000 customers in 30 utility territories in
the United States and Canada.  Founded in 1999 to provide natural
gas and electricity to consumers in deregulated energy markets,
Mxenergy helps residential customers and business owners control
their energy bills by providing both fixed and variable rate
plans.

                         *     *     *

To date, MxEnergy Holdings Inc. continues to carry Moody's
Investor Services B3 probability-of-default rating originally
assigned in September 2006.


PALM HARBOR: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Palm Harbor One, L.L.C.
        153 Andover Street, Suite 104
        Danvers, MA 01923

Bankruptcy Case No.: 07-15169

Chapter 11 Petition Date: August 16, 2007

Court: District of Massachusetts (Boston)

Judge: Joan N. Feeney

Debtor's Counsel: Jennifer L. Hertz, Esq.
                  Duane Morris, L.L.P.
                  470 Atlantic Avenue, Suite 500
                  Boston, MA 02210
                  Tel: (617) 289-9200

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Ed Vogt                        contractual               $384,000
1660 Curlew Road
Dunedin, FL 34698

West Bay Enterprise, Inc.      contractual               $200,000
9230 Hidden Water Circle
Riverview, FL 33569

St. Petersburg Times           trade debt                $139,003
P.O. Box 112
Saint Petersburg, FL
33731-0112

Greenburg Traurig              trade debt                 $97,757

Cypress Falls Condo            operational                $88,757
Association

Baker & Hostetler, L.L.P.      trade debt                 $91,297

Wilmar                         trade debt                 $46,482

Panaormitis Saroukos/          trade debt                 $43,390
P.E.S. Painting

Mark Port                      contractual                $33,000


Mid-Atlantic Renovations       trade debt                 $32,948

Fusion Creative, Inc.          trade debt                 $25,799

House of Floors, Inc.          trade debt                 $20,705

Clear Channel Outdoor          trade debt                 $19,855

Contractor Cabinet Sales       trade debt                 $18,389

G.E.                           trade debt                 $17,062

John & Karen Hammond           contractual                $17,056

Mami Yamajo                    contractual                $16,900

Melvin & Sandra Dearlove       contractual                $16,700

M.L.G. Management              trade debt

Real Estate Empire             contractual


PENN TREATY: S&P Lowers Counterparty Credit Rating to B- from B
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its counterparty credit
and financial strength ratings on Penn Treaty Network America
Insurance Co. to 'B-' from 'B' and removed them from CreditWatch
with negative implications, where they were placed on Aug. 1,
2006.  The outlook is stable.
      
"The downgrade reflects the failure of PTNA's parent company, Penn
Treaty American Corp., to file its year-end 2006 10-K in a timely
fashion," said Standard & Poor's credit analyst Neal Freedman.  
"This continues a pattern of failure to file its GAAP financial
statements within the required time frames.  Standard & Poor's
believes that this indicates a continuing serious lack of control
over the company's financial reporting function."
     
While PTNA has consistently filed its statutory financial
statements on time, the absence of Penn Treaty American Corp.'s
GAAP financial statements prevents a full understanding of PTNA's
financial condition.  GAAP accounting for long-term care insurance
is very different from statutory accounting, and GAAP accounting
treatment of the company's primary reinsurance agreements is
significantly different than its treatment under statutory
accounting.  The lack of audited financial statements limits
PTAC's financial flexibility and access to capital markets.
     
The company is currently in the process of adding additional staff
to its financial reporting areas to remediate its delinquent
filings and remain current in the future.  Should PTAC remediate
its control issues and return to and remain on a standard
financial reporting schedule, the outlook would likely be revised
to positive.  Until such time, the outlook will likely remain
stable.


PHILIP JOHNSON: Case Summary & Four Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Philip Stephen Johnson
        1727 South Ardmore Avenue
        Los Angeles, CA 90006

Bankruptcy Case No.: 07-17113

Chapter 11 Petition Date: August 16, 2007

Court: Central District Of California (Los Angeles)

Judge: Vincent P. Zurzolo

Debtor's Counsel: Robert P. Goe, Esq.
                  Goe & Forsythe, LLP
                  660 Newport Center Drive, Suite 320
                  Newport Beach, CA 92660
                  Tel: (949) 467-3780
                  Fax: (949) 721-0409

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

Debtor's List of its Four Largest Unsecured Creditors:

   Entity                      Nature of Claim      Claim Amount
   ------                      ---------------      ------------
Chase Bank                     Credit Card                $7,300
P.O. Box 15298
Wilmington, DE 19850

U.S. Bank                      Credit Card                $4,500
P.O. Box 790408
St. Louis, MO 63179

L.A. County Tax Collector      Property Taxes             $2,898
P.O. Box 54018
Los Angeles, CA 90054-0018

Thanh Thien Tran               Divorce Disputes          Unknown
801 Venezia Avenue
Venice, CA 90291


PHOENIX FOOTWEAR: Posts $929,000 Net Loss in Qtr. Ended June 30
---------------------------------------------------------------
Phoenix Footwear Group Inc. disclosed on Aug. 13, 2007, continued
progress on its revitalization plan as well as the consolidated
results for its second quarter and six months ended June 30, 2007.

For the second quarter of fiscal 2007, the company reported a net
loss of $929,000, compared with a net loss of $342,000 for the
second quarter of fiscal 2006.  Net loss for the second quarter of
fiscal 2007 included a net loss of $149,000 from the discontinued
operations of the Royal Robbins brand.  Net loss for the second
quarter of fiscal 2006 included a net loss of $169,000 from the
discontinued operations of the Royal Robbins brand.

Net sales from continuing operations for the second quarter of
fiscal 2007 decreased 11.3% to $25.2 million, compared to
$28.4 million for the second quarter of fiscal 2006.  The decline
was primarily driven by a 47.7% decrease in Tommy Bahama Footwear,
and a 17.8% decrease in Altama.  The net sales decrease was
partially offset by a 14.9% increase in Trotters.

"The past several months have been particularly productive as we
accomplished several important objectives necessary to build our
foundation for the future," commented Jim Riedman, Phoenix
Footwear's chairman.  "Cathy Taylor has quickly transitioned into
her new role as chief executive officer and is already having a
significant impact at the company."

Cathy Taylor, Phoenix Footwear's chief executive officer, added,
"Over the last several months, we have been conducting an
assessment of each of our brands and functional areas.  Although
we are only part way through this assessment, I am pleased with a
number of initial findings.  While we are disappointed in our
financial performance for the current quarter, based on my
experience in this industry, I have confidence in our ability to
make some short-term gains for the remainder of 2007 and, more
importantly, provide a strong foundation for substantial
improvement in 2008.  We expect to finish our assessment and
complete the framework for our revitalization plan by the end of
the third quarter."

Ms. Taylor continued, "We do believe recent events are steps in
the right direction.  Specifically, we successfully closed the
sale of our Royal Robbins division and paid down a significant
portion of our long-term debt, providing us with a stronger
balance sheet which will allow us to pursue our growth initiatives
and strengthen our remaining brands.  Our Altama unit secured a
new five year contract from the Department of Defense which
solidifies this division's outlook.  Additionally, our Tommy
Bahama Footwear brand participated in Nordstrom's corporate-wide
product style-out which we believe will result in an all region
penetration with significant increases in our pattern and door
penetration.  While we do not expect Tommy Bahama to make up all
the ground it lost in the first half of the year, we do believe
this important increase in product and door penetration will
result in double-digit year-over-year growth for the remainder of
fiscal 2007, solid gross margins and positive earnings in the
fourth quarter.  We also expect to generate positive growth from
most of our remaining brands for the second half of the year."

Ms. Taylor concluded, "As we ramp our Altama operations back up
without the benefit of shipments until very late in the third
quarter, we expect to experience pressure on our consolidated
gross margins during the current quarter.  We anticipate, however,
that we will be free of that burden as we enter the final quarter
of fiscal 2007."

Gross margin from continuing operations for the second quarter of
fiscal 2007 was 30.0%, compared to 35.2% for the second quarter of
fiscal 2006.  The decrease in gross margin is primarily related to
the Tommy Bahama Footwear division, higher manufacturing costs
associated with lower production volumes at the company's Altama
division and additional sourcing and logistic costs incurred
during the period in connection with the company's product
sourcing transition from Brazil to China.

Operating costs from continuing operations were $8.9 million for
the quarter, compared to $9.6 million for the second quarter of
fiscal 2006.  Operating costs from continuing operations for the
second quarter of fiscal 2006 include a severance charge of
$829,000 associated with the departure of the company's prior
chief executive officer.  Operating expenses from continuing
operations as a percentage of net sales were 35.3% in the second
quarter of fiscal 2007, compared to 33.8% in the second quarter of
fiscal 2006.  This percentage increase is a result of costs being
expensed against a lower level of sales.
   
For the six months ended June 30, 2007, net sales from continuing
operations were $57.6 million, compared to $57.5 million for the
comparable prior-year period.  During the period the company's
military boot, accessories, and footwear and apparel segments
grew, while its premium footwear segment experienced a decline.

Net loss for the six months ended June 30, 2007 was $515,000, and
included net income of $774,000 from discontinued operations
related to the Royal Robbins business unit.  For the six months
ended July 1, 2006, the company reported net income of
$2.7 million.  Included in the 2006 six-month period was net
income of $1.1 million from discontinued operations related to the
Royal Robbins business unit.  Additionally, the six month period
ended July 1, 2006, includes a net one-time gain associated with
the Altama purchase price adjustment of $1.5 million partially
offset by the severance charge discussed earlier.

                      Sale of Royal Robbins
    
On July 2, 2007, Phoenix Footwear sold all of the outstanding
capital stock of its wholly-owned subsidiary, Royal Robbins along
with related assets of PXG Canada, to Kellwood Company.  The net
proceeds from the sale were applied to reduce the company's bank
debt.
    
Due to the sale, the results of the Royal Robbins business,
previously included in the footwear and apparel segment, have been
segregated from continuing operations and reported as discontinued
operations in the consolidated condensed statements of operations
for the three and six month periods ended June 30, 2007, and
July 1, 2006.  Interest expense incurred on the debt that was
required to be repaid as a result of the sale was allocated to
discontinued operations for these periods.  The gain from this
transaction, which on a pre-tax basis was approximately
$23 million, will be included in the third quarter of 2007
financial results.

                            Liquidity

As of June 30, 2007, Phoenix Footwear's cash and cash equivalents
totaled $1.1 million.  Additionally, the company had $51.2 million
in bank debt, including its outstanding line of credit.  As of
July 28, 2007, the company's total bank indebtedness amounted to
$14.1 million.
   
At June 30, 2007, the company's consolidated financial statements
showed $104.6 million in total assets, $72.6 million in total
liabilities, and $31.9 million in total stockholders' equity.

The company's consolidated balance sheet at June 30, 2007, also
showed strained liquidity with $58.6 million in total current
assets available to pay $67.1 million in total current
liabilities.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a4

                        Going Concern Doubt

Grant Thornton LLP exressed substantial doubt about Phoenix
Footwear Group Inc.'s ability to continue as a going concern after
auditing the company's consolidated financial statements as of
Dec. 30, 2006, and Dec. 31, 2005.  Grant Thornton cited the
company's net loss of $20.4 million for the year ended Dec. 30,
2006, and the company's deficit in working capital of $9.5 million
at Dec. 30, 2006.   The auditing firm also added that the company
did not meet the financial covenants under its credit agreement as
of Dec. 30, 2006, and will not meet the covenants as of March 31,
2007.

As of June 30, 2007, the company failed to meet its financial
covenants with its bank.  Since that date however, the company's
term loan indebtedness has been repaid in full and the company is
having ongoing discussions with its bank about a replacement
facility consistent with the company's reduced funding needs.

                      About Phoenix Footwear

Headquartered in Carlsbad, California, Phoenix Footwear Group Inc.
(AMEX: PXG) -- http://www.phoenixfootwear.com/-- designs,  
develops and markets a diversified selection of men's and women's
dress and casual footwear, belts, and other accessories.  The
company's moderate-to-premium priced brands include the Tommy
Bahama Footwear(R), Trotters(R), SoftWalk(R), Strol(R), H.S.
Trask(R), and Altama(R) footwear lines, and Chambers Belts(R).


POWER EFFICIENCY: Posts $837,000 Net Loss in Quarter Ended June 30
------------------------------------------------------------------
Power Efficiency Corporation reported on Aug. 13, 2007, its  
results for the second quarter ended June 30, 2007.

Net loss for the quarter was $837,000 compared to a net loss of
$1.7 million for the second quarter of the prior year.

Revenue for the quarter ended June 30, 2007, was $230,000, up
sharply compared to $44,000 for the comparable period last year.

For the six months ended June 30, 2007, revenue was $267,000
compared to $69,000 for the comparable period last year.  Net loss
for the first half of fiscal 2007 was $1.7 million compared to a
net loss of $2.8 million in the same period last year.

Steven Strasser, chairman and chief executive officer stated, "We
are pleased that revenue for the second quarter alone exceeded
revenue for all of 2006.  Our main goals for 2007 include growing
sales to end users and through our service provider partners, and
gaining commitments from Original Equipment Manufacturers to adopt
our ESAVE Technology(TM).  We previously announced that numerous
OEMs of motors and motor-driven equipment are considering adopting
ESAVE Technology(TM) as a standard component to improve the
efficiency of their products.  Since that time, the list of OEMs
testing and considering adopting our technology has grown.  Our
focus is to enter agreements with OEMs that will lead to large and
repeatable revenue streams."

Strasser continued: "Other significant accomplishments for the
second quarter included additional patent filings on new
inventions, being approved for an energy efficiency rebate from
Sierra Pacific Resources and Nevada Power Company, continuing with
our energy efficiency program with Southern California Edison,
receiving CSA and UL certification, and launching 'ESAVE
Technology' as the brand for our technology.  We plan to
incorporate the ESAVE Technology brand in OEM agreements as the
mark for our technology, so third party products will have 'ESAVE
Inside'.  Furthermore, we are continuing to add expertise in
engineering and sales to create new products and grow revenue."

At June 30, 2007, the company's consolidated balance sheet showed
$3.85 million in total assets, $2.18 million in total liabilities,
and $1.67 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?2292

                       Going Concern Doubt

As reported in the Troubled Company Reporter on April 18, 2007,
Sobel & Co. LLC expressed substantial doubt about Power Efficiency
Corp.'s ability to continue as a going concern after auditing the
company's consolidated financial statements as of the year ended
Dec. 31, 2006.  The auditing firm pointed to the company's
recurring losses from operations, deficiency of cash from
operations and lack of sufficient liquidity to continue its
operations.

                      About Power Efficiency

Headquartered in Las Vegas, Power Efficiency Corp. (OTC BB: PEFF)
-- http://www.powerefficiencycorp.com/ -- develops efficiency  
technologies for electric motors, called ESAVE Technology(TM),
which improve the efficiency of escalators, elevators, grinders,
granulators, mixers, saw mills and other motor-driven equipment.
The company is also developing products to reduce the amount of
electricity used by appliances and light commercial equipment,
such as refrigerators, pumps, and residential air conditioning.


PRUDENTIAL MORTGAGE: Gets $25.8 Mil. Funding for Fisher Building
----------------------------------------------------------------
Prudential Mortgage Capital Company, the commercial mortgage
lending business of Prudential Financial Inc., closed a
$25.8 million refinancing loan for the Fisher Building, a high-
rise apartment complex in Chicago, on behalf of Fannie Mae
DUS(TM).

Suzanne Standerfer of Prudential's Chicago office originated the
120-month fixed-rate loan.

                      About Fisher Building

Fisher Building is an historical landmark originally constructed
in 1896 and most recently renovated in 2002.  The 184-unit
apartment building still boasts original details such as marble,
mahogany doors, mosaic floors, and wooden trim found throughout.
Additional building features include a fitness center, laundry
facility, business center, lounge, doorman and concierge services,
electronic entry security system, storage, on-site ATM machine,
10-foot ceilings and large bay windows.  The Fisher Building is
located on the east side of the famous Chicago "Loop" near the
Harold Washington Public Library and the "El" train station on Van
Buren.

                    About Prudential Mortgage

Prudential Mortgage Capital -- http://www.prumortgagecapital.com/
-- is the commercial mortgage lending business of Prudential
Financial Inc.  It is a national full-service, commercial and
multifamily mortgage finance business, originates loans for Fannie
Mae DUS(TM), FHA and Freddie Mac Targeted Affordable programs; the
capital markets; Prudential's general account; and other
institutional investors.  The company, with $53 billion in assets
under management and administration as of March 31, 2007, offers
fixed- and floating-rate loans; mezzanine, structured and bridge
financing; forward commitments; affordable housing and healthcare
finance.

                          *     *     *

As reported in the Troubled Company Reporter on March 22, 2007,
Fitch upgraded Prudential Mortgage Capital Funding's ROCK
commercial mortgage pass-through certificates, series 2001-C1,
$4.5 million class L to 'BB+' from 'BB'.


PRUDENTIAL SECURITIES: Moody's Junks Ratings on Two Cert. Classes
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes
and affirmed the ratings of nine classes of Prudential Securities
Secured Financing Corporation, Commercial Mortgage Pass-Through
Certificates, Series Key 2000-C1 as:

-- Class A-2, $438,746,919, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class B, $34,693,000, affirmed at Aaa
-- Class C, $40,815,000, affirmed at Aaa
-- Class D, $10,203,000, affirmed at Aaa
-- Class E, $10,203,000, upgraded to Aaa from Aa2
-- Class F, $18,367,000, upgraded to Aa3 from A3
-- Class G, $14,285,000, upgraded to A2 from Baa2
-- Class J, $4,081,000, affirmed at Ba2
-- Class K, $6,122,000, affirmed at Ba3
-- Class M, $10,204,000, affirmed at Caa1
-- Class N, $6,122,000, affirmed at Caa2

As of the July 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by about 21.7% to
$639.4 million from $816.3 million at securitization.  The
certificates are collateralized by 127 mortgage loans secured by
commercial and multifamily properties.  The loans range in size
from less than 1% of the pool to 2.9% of the pool, with the top 10
loans representing 16.8% of the pool.  Since securitization 10
loans have been liquidated from the trust resulting in aggregate
realized losses of about $11.6 million.  Thirty-six loans,
representing 36.2% of the pool, have defeased and are secured by
U.S. Government securities.  Currently there are no loans in
special serving.  Twenty-six loans, representing 22.7% of the
pool, are on the master servicer's watchlist.

Moody's was provided with full-year 2006 operating results for
about 9% of the performing loans in the pool.  Moody's loan to
value ratio is 82.3%, compared to 84.9% at the last full review in
August 2006 and compared to 86.7% at securitization.  Moody's is
upgrading Classes E, F and G due to increased credit support and
defeasance.

The top three non-defeased loans represent 8.3% of the outstanding
pool balance.  The largest loan exposure is the 4000 Alameda Loan
($18.7 million - 2.9%), which is secured by a 112,000 square foot
Class B office building located in Burbank, California.  The
property was built in 1983 and renovated in 1999.  Current
occupancy is 93%, compared to 44.4% at last review and compared to
100% at securitization.  Despite increased occupancy, performance
has declined as expenses have risen significantly since
securitization.  The loan is currently on the master servicer's
watchlist due to low debt service coverage.  Moody's LTV is in
excess of 100%, the same as at last review and compared to 87.9%
at securitization.

The second largest loan is the Quality Inn Portfolio Loans
($18.5 million - 2.9%), which is comprised of two cross-
collateralized and cross-defaulted loans secured by two beachfront
full-service hotels totaling 309 rooms.  The properties are
located in Ocean City, Maryland.  Although built in 1962 and 1965,
the hotels were renovated and expanded in the 1980s.  As of
March 2007 the properties' RevPAR was $81.70, compared to
$80.69 as of December 2005 and compared to $75.29 at
securitization.  Moody's LTV is 64.1%, compared to 65.2% at last
review and compared to 73.5% at securitization.

The third largest loan is the Red Rock Villas Apartments Loan
($16.3 million -- 2.5%), which is secured by a 192-unit apartment
complex located in Las Vegas, Nevada.  As of December 2006 the
property was 92% leased, compared to 93% at securitization.
Moody's LTV is 79.4%, compared to 95.6% at securitization.


PRUDENTIAL SECURITIES: Moody's Holds Caa1 Rating on Class N Certs.
------------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 10 classes of
Prudential Securities Secured Financing, Commercial Mortgage Pass-
Through Certificates, Series 1999-C2 as:

-- Class A-2, $348,662,902, affirmed at Aaa
-- Class A-EC1, Notional, affirmed at Aaa
-- Class A-EC2, Notional, affirmed at Aaa
-- Class B, $41,293,000, affirmed at Aaa
-- Class C, $45,639,000, affirmed at Aaa
-- Class D, $13,040,000, affirmed at Aaa
-- Class E, $30,426,000, affirmed at Aaa
-- Class F, $15,213,000, affirmed at Aaa
-- Class G, $15,213,000, affirmed at Aa3
-- Class N, $8,693,000, affirmed at Caa1

As of the July 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by about 33% to
$582.3 million from $869.3 million at securitization.  The
Certificates are collateralized by 190 mortgage loans ranging in
size from less than 1% to 4.3% of the pool, with the top 10 loans
representing 19.6% of the pool.  Sixty two loans, representing
32.3% of the pool, have defeased and have been replaced with U.S.
Government securities.

Ten loans have been liquidated from the pool resulting in
aggregate realized losses of about $9.7 million.  Currently there
are no loans in special servicing.  Thirty-one loans, representing
18.5% of the pool, are on the master servicer's watchlist.

Moody's was provided with year-end 2006 operating results for
97.7% of the pool.  Moody's loan to value ratio is 75.2%, compared
to 76.3% at Moody's last full review in June 2006, resulting in an
affirmation of all classes.

The top three non-defeased loans represent 9% of the pool.  The
largest loan is the 122 Fifth Avenue Loan ($24.9 million -- 4.3%),
which is secured by a 198,000 square foot office building located
in New York City.  The property is 100% leased, the same as at
last review and at securitization.  Moody's LTV is 69.3%, compared
to 70.4% at last review.

The second largest loan is the Dudley Farms Plaza Loan
($16 million - 2.7%), which is secured by a 263,000 square foot
power center located in South Charleston, West Virginia.  The
center is anchored by Kohl's, OfficeMax, Goody's and Michaels and
was 100% occupied as of December 2006, the same as at last review.
Performance has declined slightly since last review due to
increased operating expenses.  Moody's LTV is 74.2%, compared to
73.5% at last review.

The third largest loan is the Emery/Busch Building Loan
($11.4 million -- 2%), which is secured by 317,500 square foot
warehouse building located in Nashua, New Hampshire.  The property
is fully occupied by the U.S. Postal Service through March 2008.
Moody's LTV is 90.4%, compared to 91.8% at last review.


PUBLICARD INC: Inks LOI to Fund Plan of Reorganization
------------------------------------------------------
PubliCARD Inc. entered into a letter of intent with The 500 Group
LLC, an entity controlled by its Chief Executive Officer Joseph E.
Sarachek, to fund a plan of reorganization in the company's
pending bankruptcy proceeding in the United States Bankruptcy
Court for Southern District of New York.

The terms of the Letter of Intent state that The 500 Group will
provide $500,000 for the Company to satisfy its creditors and
continue to operate as an ongoing publicly reporting company post-
bankruptcy.  Existing shareholders will receive 10% of the common
stock in the emerged entity.

In consideration for its investment, The 500 Group will own the
balance of the common stock. Other than Mr. Sarachek, none of the
existing Board Members are investors in The 500 Group or will have
a controlling stake in the newly emerged entity.

Consummation of the transactions contemplated by the Letter of
Intent will require approval by the company's Board of Directors,
creditors, certain shareholders and by the Bankruptcy Court.  
There can be no assurance that the required approvals will be
obtained.

Headquartered in New York, PubliCARD Inc. fka Publicker Inc. filed
a chapter 11 petition on May 17, 2007 (Bankr. S.D.N.Y. Case No.
07-11517).  David C. McGrail, Esq., at the Law Offices of David C.
McGrail in New York represents the Debtor in its restructuring
efforts.  The company listed assets and debts between $100,000 to
$500,000 when it sought bankruptcy protection.


QUAKER FABRIC: Files for Chapter 11 Bankruptcy Protection
---------------------------------------------------------
Quaker Fabric Corporation and its wholly owned subsidiary, Quaker
Fabric Corporation of Fall River, have filed voluntary petitions
for relief under Chapter 11 of the U.S. Bankruptcy Code in the
U.S. Bankruptcy Court for the District of Delaware.  Quaker's
affiliates outside the United States were not included in the
Chapter 11 filing.

On July 2, 2007, the company likely would commence an orderly
liquidation of its business and a sale of its assets and that any
such winding up and liquidation would not generate sufficient
funds to permit any payment to holders of its common stock.

On July 9, 2007, the company retained an experienced liquidation
advisory firm to consult with management on the liquidation of the
assets of the company in a manner intended to yield the greatest
return to the company's creditors.  This process has been ongoing,
with the Company seeking bids from qualified buyers for the
purchase of the company as a whole, as well as on each asset
class, including machinery and equipment, raw material and
finished goods inventory, accounts receivable, intellectual
property and real estate.

During the Chapter 11 proceedings, this process will continue
under court supervision.  In addition, the Company has reached an
agreement for up to $1,650,000 in new debtor-in-possession
financing.  Upon Court approval, this DIP financing will provide
sufficient funding during the Chapter 11 process.

The company commenced its annual two-week planned shutdown on
June 29, 2007 and did not have the financing needed to resume
operations on July 16, which would otherwise have marked the end
of the shutdown period.  On July 2, the employment relationships
of substantially all of the company's 930 employees were
terminated.

Based in Falls River, Massachusetts, Quaker Fabric Corporation
(NASDAQ Symbol: QFAB) -- http://www.quakerfabric.com/-- is a  
supplier of upholstery fabrics for furniture markets in the United
States and abroad.


QUESTEX MEDIA: Acquires “The Show” Producers - Oxford Publishing
----------------------------------------------------------------
Questex Media Group Inc. has acquired Oxford Publishing Inc.,
producers of “The Show”, a beverage and food event in the Western
Hemisphere.
    
“The Show” includes the Nightclub & Bar Convention and Trade Show,
the International Restaurant Show-Las Vegas and the International
Coffee and Tea Expo.  All of these events will be co-located in
2008 with HotelWorld Expo and Conference, which is also owned by
Questex.  The company also publishes Nightclub & Bar Magazine.
    
Oxford Publishing will operate as a subsidiary of Questex Media
Group.  The company's founder, CEO and president, Ed Meek will
continue to lead the business.  Oxford's chief operating officer,
Jennifer Robinson and the entire Oxford-based staff will continue
to manage the events and magazines working with Questex's existing
hotel and hospitality group of media and events.
    
“We chose to move forward with Questex because of their
entrepreneurial culture and the top priority they clearly place on
the hospitality industry,” Oxford's president & CEO Ed Meek, said.
“They have an impressive track record of investing in their core
hotel and hospitality media and events and have had great success
launching new products in this market.”  

“We are excited to partner with them and tap their extensive
domestic and international tradeshow management experience,
databases, publishing, digital media and other resources.  Our
customers will truly benefit as we now have many resources at our
fingertips to help us grow, at a quicker pace, the business, the
event and the marketing opportunities for our supporters and
partners,” Mr. Meek added.
    
“We are tremendously pleased to have been able to conclude this
transaction and have Ed and his team join Questex,” Kerry Gumas,
president & CEO of Questex Media Group, said.  “Ed and his team
share our vision, entrepreneurial spirit and commitment to serving
customers.  We are looking forward to combining our resources and
working together to drive the growth of the business and serve its
customers in the beverage, food, nightclub, bar and restaurant
industries through tradeshows and live events, print, digital and
mobile media.”
    
The Questex Hotel & Hospitality Group, including Oxford, serves
over 3,000 exhibitors and advertisers and more than 200,000
owners, executives, managers and professionals in the $123 billion
hotel and hospitality industry and the $537 billion restaurant
industry.

Oxford's signature event, “The Show”, its International Restaurant
Show-Las Vegas and Questex's HotelWorld event are to be co-located
beginning in February 2008, and are at the center of a unique
grouping of co-located hospitality events produced by Questex and
Oxford and sponsored by a wide range of state, national,
international and professional associations and media to create
the International Hospitality Week(R) to be held annually in
Las Vegas.

                   About Oxford Publishing Inc.
   
Headquartered in Oxford, Mississippi, Oxford Publishing Inc. –
http://www.nightclub.com/-- began 22 years ago with Nightclub &  
Bar Magazine and has grown into offering multiple forms of media
serving the beverage and food industries including trade
publications, international and regional trade shows, Web sites,
education and an association and more.
    
                     About Questex Media Group
    
Headquartered in Newton, Massachusetts, Questex Media Group Inc. –
http://www.questex.com/-- is diversified business-to-business  
integrated media and information provider.  Questex serves
multiple industries including technology, beauty, spa, travel,
hospitality, leisure, home entertainment, industrial specialties
and service industries through a range of publications, events,
interactive media, research, information and integrated marketing
services.  The company's media properties include 81 trade
magazines and eNewsletters, 84 websites, 45 conferences tradeshows
and events, well as a range of research, data and information
products.  The company's businesses are managed through operating
companies including Questex Media Group and five subsidiaries;
InfoTrends, Inc.; McLean Events International Ltd; Imaging
Network; Five Star Alliance; and Oxford Publishing.  The company's
combined operations include more than 450 employees in offices
throughout North America, South America, Asia and Europe.

                           *     *     *
    
As reported in the Troubled Company Reporter on Aug. 15, 2007,
Moody's Investors Service assigned a B3 first-time corporate
family rating to Questex Media Group Inc.


RADNET MANAGEMENT: S&P Withdraws Bank Loan and Recovery Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its bank loan and
recovery ratings on RadNet Management Inc.'s proposed
$445 million secured bank facility.
      
"We have withdrawn the ratings on the facility, which was
cancelled due to unfavorable market conditions," explained
Standard & Poor's credit analyst Cheryl Richer.
     
At the same time, S&P affirmed the ratings on the company's
existing bank facilities, which have been increased by
$35 million via an amendment to the credit agreement.  The
$250 million first-lien term loan and $55 million revolving credit
facility are rated 'B+', with a recovery rating of '2', indicating
expectation of substantial recovery (70%-90%) in the event of a
default.  The $135 million second-lien term loan is rated 'CCC+',
with a recovery rating of '6', indicating expectation of
negligible recovery (0%-10%) in the event of default.     
     
The rating on Los Angeles-based RadNet reflects the November 2006
acquisition by its parent, Radnet Inc., of Radiologix Inc.  The
merger increased RadNet's scale and added an East Coast presence.  
In addition, the company benefits from its diverse mix of
diagnostic imaging modalities and strong payor relationships.  
Favorable demand prospects are tied to the aging population and
the benefits of imaging itself, which can preclude more expensive
medical procedures and aid in the diagnosis of an increasing
variety of disease states.  These strengths are largely offset by
the fragmented and competitive nature of the diagnostic imaging
industry, relatively low barriers to entry, reimbursement risk,
and the company's considerable dependence on an affiliated entity,
Beverly Radiology Medical Group, for its professional staffing.  
Adjusted for operating leases, debt leverage is high.


RAHSAAN DELANEY: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Rahsaan Delaney
        41 Searling Street
        Hempstead, NY 11550

Bankruptcy Case No.: 07-73157

Chapter 11 Petition Date: August 16, 2007

Court: Eastern District of New York (Central Islip)

Debtor's Counsel: Lawrence F. Morrison, Esq.
                  220 East 72nd Street
                  New York, NY 10021
                  Tel: (212) 861-1224
                  Fax: (646) 514-3712

Estimated Assets: $1 Million to $100 Million

Estimated Debts:  $1 Million to $100 Million

The Debtor did not file a list of its 20 largest unsecured
creditors.


RESIDENTIAL CAPITAL: Fitch Lowers Long-Term IDR to BB+ from BBB
---------------------------------------------------------------
Fitch Ratings has downgraded Countrywide Financial Corp.'s long-
term Issuer Default Rating to 'BBB+' from 'A' and Residential
Capital LLC's long-term IDR to 'BB+' from 'BBB'.  Additionally,
Fitch has placed Indymac Bancorporation Inc. on Rating Watch
Negative.  The rating actions also affect all related subsidiaries
of the three mortgage companies.  A detailed list of affected
ratings follows at the end of this release.  Fitch will provide
more detailed commentaries on the each of the affected entities
shortly.
  
Fitch's downgrades and Rating Watch Negative placement of these
residential mortgage companies reflects the unprecedented
disruption in the capital markets, which has severely reduced
liquidity for mortgage-centric entities.  Fitch's actions reflect
the impact on primary liquidity sources and the degree to which
the duration of the current market dislocation affects financial
flexibility.  Sources of financing that Fitch believed would be
more resilient have proven less accessible in the current stressed
environment.  While these actions are primarily prompted by
reduced liquidity, other factors such as weakening operating
performance and deteriorating asset quality beyond Fitch's
expectations are also considerations in this action.  Fitch
recognizes efforts to shore up additional sources of liquidity and
reduced reliance on confidence-sensitive capital markets
financing.  Fitch will consider the ability of these entities to
increase utilization of more stable and reliable sources of
financing afforded by their respective bank charters.
  
Fitch has downgraded and placed these ratings on Rating Watch
Negative:
  
Countrywide Financial Corp.
  -- Long-term Issuer Default Rating to 'BBB+' from 'A';
  -- Short-term Issuer Default Rating to 'F2' from 'F1';
  -- Senior debt to 'BBB+' from 'A';
  -- Subordinated to 'BBB' from 'A-';
  -- Individual to 'C' from 'B';
  -- Support floor 'NF'.
  
Countrywide Bank
  -- Long-term Issuer Default Rating to 'BBB+' from 'A';
  -- Short-term Issuer Default Rating to 'F2' from 'F1';
  -- Long-term deposits to 'A-' from 'A+';
  -- Short-term deposits to 'F2' from 'F1';
  -- Individual to 'B/C' from 'B';
  -- Support floor 'NF'.
  
Countrywide Home Loans, Inc.
  -- Long-term Issuer Default Rating to 'BBB+' from 'A';
  -- Short-term Issuer Default Rating to 'F2' from 'F1';
  -- Senior debt to 'BBB+' from 'A'.
  
Countrywide Capital I, III, IV, V
  -- Trust preferred to 'BBB-' from 'A-'.
  
Residential Capital LLC
  -- Long-term Issuer Default Rating 'BB+' from 'BBB';
  -- Short-term Issuer Default Rating to 'B' from 'F2';
  -- Senior debt to 'BB+' from 'BBB';
  -- Subordinated to 'BB-' from 'BBB-'.
  
Additionally, Fitch has placed these ratings on Rating Watch
Negative:
  
Indymac Bancorporation Inc.
  -- Long-term Issuer Default Rating 'BBB-';
  -- Short-term Issuer Default Rating 'F2';
  -- Individual 'B/C';
  -- Support floor 'NF'.
  
Indymac Bank, F.S.B.
  -- Long-term Issuer Default Rating 'BBB-';
  -- Short-term Issuer Default Rating 'F2';
  -- Long-term deposits 'BBB';
  -- Short-term deposits 'F2';
  -- Individual 'B/C';
  -- Support floor 'NF'.
  
Indymac Capital Trust I
  -- Trust preferred 'BB+'.


RESIDENTIAL CAPITAL: Moody's Lowers Senior Debt Rating to Ba1
-------------------- ----------------------------------------
Moody's Investors Service downgraded to Ba1, from Baa3, its
ratings on the senior debt of Residential Capital, LLC.  The
ratings remain under review for possible downgrade.

"These rating actions reflect the continued, significant funding
and valuation volatility in the single-family mortgage market,
coupled with ResCap's challenges in restructuring its residential
financial group, as well as an adverse business environment that
could create further profit pressure at the firm," says Philip
Kibel, Moody's analyst.

Moody's review of ResCap's ratings for possible further downgrade
reflects the uncertainty regarding ResCap's net operating
performance, and funding of and origination flows in its business
due to continued volatility in the mortgage market, while
navigating a potentially more adverse mortgage credit quality
environment.  A rating confirmation would likely result should
ResCap be successful in its efforts to stabilize its operations
and portfolio quality, and strengthen its earnings.  A rating
downgrade would reflect more acute challenges to its liquidity or
funding flexibility, continued high net operating losses, or
material asset quality deterioration.

These ratings were downgraded, and are under review for downgrade:

Residential Capital, LLC

-- Senior debt to Ba1, from Baa3;
-- senior debt shelf to (P)Ba1, from (P)Baa3;
-- subordinate debt to Ba2, from Ba1;
-- subordinate debt shelf to (P)Ba2, from (P)Ba1

Residential Capital, LLC's rating for short-term debt was
downgraded to Not Prime, from Prime-3.

Residential Capital, LLC, a subsidiary of GMAC LLC, is a leading
real estate finance company.  ResCap is a holding company for the
real estate finance business of GMAC, and has globally diversified
businesses that include: US Residential Real Estate Finance Group,
the provision of financing and equity capital to residential land
developers and homebuilders, and financing to resort developers
and health-care related enterprises (Business Capital Group), and
the international origination, purchase, sale and securitization
of residential mortgages (International Business Group).  ResCap
reported assets and equity of about $122 billion and $7.5 billion,
respectively, as of June 30, 2007.


RUGGLES RESTAURANT: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Ruggles Restaurant Group, L.P.
        dba Ruggles Grill Express at Sage
        dba Ruggles Bistro
        dba Austin Cheesecake Kitchen
        12400 Highway 71 West, Suite 350-246
        Austin, TX 78738

Bankruptcy Case No.: 07-11505

Chapter 11 Petition Date: August 16, 2007

Court: Western District of Texas (Austin)

Debtor's Counsel: Lynn H. Butler, Esq.
                  Brown, McCarroll, LLP
                  111 Congress Avenue, Suite 1400
                  Austin, TX 78701
                  Tel: (512) 472-5456
                  Fax: (512) 479-1101

Estimated Assets: Less than $10,000

Estimated Debts:  $1 Million to $100 Million

The Debtor did not file a list of its 20 largest unsecured
creditors.


RYERSON INC: ISS Urges Shareholders to Re-Elect Board of Directors
------------------------------------------------------------------
Institutional Shareholder Services, an independent proxy advisory
firm, issued a recommendation to re-elect all 11 members of
Ryerson Inc. board of directors.

After conducting a thorough analysis and meeting with both Ryerson
and Harbinger, ISS has concluded that:

   -- Harbinger has not presented any plan on how it would manage
      the company differently;
    
   -- Harbinger lacks any formal strategy to create value for
      stockholders;
    
   -- the sale process resulting in the $34.50 per share merger
      with Platinum Equity is fair and stockholders should have
      the right to vote on the transaction; and
    
   -- Ryerson's financial performance has performed in line with
      its peers, contrary to Harbinger's arguments.

“We are extremely pleased with ISS' recommendation that
stockholders should vote 'FOR' Ryerson's entire board of directors
and reject all of Harbinger's nominees,” Neil Novich, chief
executive officer of Ryerson, said.  

“ISS clearly supports our view that all stockholders should have a
right to vote on the proposed acquisition with Platinum Equity and
that the board has run a thorough strategic review and auction
process,” Mr. Novich continued.  “We believe that the $34.50 per
share agreement we have reached with Platinum is at a fair price
with committed financing in an uncertain credit market.”

ISS also recommended that stockholders support the board's
recommendations on the other voting matters at the meeting.

“The board will continue to focus on completing the merger with
Platinum Equity as it is in the best interest of all
stockholders,” Mr. Novich added.

Ryerson urges all stockholders to follow ISS' independent
recommendation to vote on the WHITE proxy card at the company's
Annual Meeting of Shareholders Thursday, Aug. 23, 2007.

The definitive proxy statement and other documents may be obtained
free from Ryerson by directing a request to:

     Ryerson Inc.
     ATTN: Investor Relations
     2621 West 15th Place
     Chicago, IL 60608

                 About Harbinger Capital Partners

The Harbinger Capital Partners investment team located in New York
City manages in excess of $5 billion in capital through two
complementary strategies.  Harbinger Capital Partners Master Fund
I Ltd. is focused on restructurings, liquidations, event-driven
situations, turnarounds, and capital structure arbitrage,
including both long and short positions in highly leveraged and
financially distressed companies.  Harbinger Capital Partners
Special Situations Fund L.P. is focused on distressed debt
securities, special situation equities, and private loans/notes in
a predominantly long-only strategy.

                        About Ryerson Inc.

Ryerson Inc. (NYSE: RYI) -- http://www.ryerson.com/-- is a    
distributor and processor of metals in North America, with 2006
revenues of $5.9 billion.  The company services customers through
a network of service centers across the United States and in
Canada, Mexico, India, and China.  On Jan. 1, 2006, the company
changed its name from Ryerson Tull Inc. to Ryerson Inc.

                         *     *     *

As reported in the Troubled Company Reporter on July 26, 2007,
Moody's Investors Service placed Ryerson Inc.'s B1 corporate
family rating under review for possible downgrade.


SCOTTISH RE: Has Over $500MM Available Liquidity as of June 30
--------------------------------------------------------------
Scottish Re Group Limited provided additional disclosure regarding
its sub-prime asset backed securities and Alt-A residential
mortgage backed securities holdings.  The disclosure supplements
the disclosure provided in its Form 10-Q for the three months
ended June 30, 2007, as filed with the Securities and Exchange
Commission on Aug. 14, 2007.

As of June 30, 2007, the company estimates that it had in excess
of $500 million of available liquidity among itself and its
subsidiary, Scottish Annuity & Life Insurance Company (Cayman)
Ltd.  This amount represents liquidity in excess of liquidity held
by the company's insurance operating subsidiaries and includes
cash and marketable securities as well as $275 million available
under the Stingray facility.

Because the company has significant operations and capital outside
of the United States, the company does not believe that limiting
an analysis of its financial position to U.S. statutory surplus
calculated in accordance with the NAIC Accounting Practices and
Procedures Manual is an appropriate way to evaluate the financial
condition of its consolidated worldwide operations.  The company's
management believes that a more appropriate measure is
shareholders' equity. The company had total shareholders' equity
of about $1.2 billion as of June 30, 2007.

As long as the value of the assets in the securitization
portfolios is greater than the statutory reserves of the
underlying block of business, the company's operating subsidiaries
are not required to, among other things, pledge additional assets
to secure reserve credit outside of the securitization structure.  
Thus, the amount of invested assets that exceeds statutory
reserves within the securitization portfolios represents
additional protection from unexpected market value declines in
invested assets.

As of June 30, 2007, the total invested assets within the
Company's three securitization structures exceeded the statutory
reserves covered by the structures by about $1.4 billion.

The company believes its current financial position provides it
with sufficient capital and liquidity to withstand temporary
market dislocations or potential losses arising from
underperformance of its subprime ABS and Alt-A holdings in the
current market environment.

                        About Scottish Re

Scottish Re Group Ltd. -- http://www.scottishre.com/-- (NYSE:SCT)     
is a global life reinsurance company.  Scottish Re has operating
businesses in Bermuda, Grand Cayman, Guernsey, Ireland, Singapore,
the United Kingdom and the United States.  Its flagship operating
subsidiaries include Scottish Annuity & Life Insurance Company
(Cayman) Ltd., Scottish Re (U.S.) Inc. and Scottish Re Limited.

                          *     *     *

As reported in the Troubled Company Reporter on June 7, 2007,
Fitch Ratings has upgraded Scottish Re's Issuer Default Rating to
'BB-' from 'B+' and the Insurer Financial Strength ratings of its
primary operating subsidiaries to 'BBB-' from 'BB+'.  The ratings
have been removed from Rating Watch Positive; the Rating Outlook
is Stable.


SECURE COMPUTING: Improved Performance Cues S&P to Lift Rating
--------------------------------------------------------------
Standard & Poor's Rating Services raised its corporate credit
rating on San Jose, California-based Secure Computing Corp. to
'B+' from 'B', following the successful integration of CipherTrust
Inc. and an improved financial profile.  The outlook is positive.
     
At the same time, S&P raised its bank loan rating on the company's
$110 million senior secured bank facility to 'BB-' from 'B+'.  The
first-lien facility consists of a $90 million term loan due 2013
and a $20 million revolving credit facility due 2012.  The
recovery rating of '2' indicates the expectation for substantial
(70%-90%) recovery in the event of a payment default.  
     
"The ratings on Secure Computing reflect the company's narrow
business profile and secondary market positions," said Standard &
Poor's credit analyst David Tsui.  "These factors are offset
partially by the favorable business environment in enterprise
security solutions and recurring revenues based on a predictable
subscription and maintenance revenue stream."  Secure Computing
provides software solutions and appliances that enable secure
Internet use at the enterprise level, giving enterprise-based
clients protection against corruption by viruses, identity theft,
or bandwidth "clog" caused by spam.
     
Leverage is comfortable for the rating, with operating-lease
adjusted debt to adjusted EBITDA at about 2.2x, down from
approximately 4x a year ago.  The company has historically been
acquisitive, purchasing five companies since 2002.  However, the
company is expected to limit acquisition activities over the near
term as it pursues its internal growth objectives and continues to
focus on further debt reduction.


SENTINEL MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Sentinel Management Group, Inc.
        650 Dundee Road
        Suite 460
        Northbrook, IL 60062

Bankruptcy Case No.: 07-14987

Type of Business: [Cash-management firm.  
                  See http://www.sentgroup.com/]

Chapter 11 Petition Date: August 17, 2007

Court: Northern District of Illinois (Chicago)

Judge: John H. Squires

Debtor's Counsel: Ronald Barliant, Esq.
                  Goldberg, Kohn, Bell & Black
                  Rosenbloom & Moritz, Ltd.
                  55 East Monroe Street, Suite 3700
                  Chicago, IL 60603
                  Tel: (312) 201-4000
                  Fax: (312) 332-2196

Estimated Assets: More than $100 Million

Estimated Debts:  More than $100 Million

Debtor's List of its 20 Largest Unsecured Creditors:

   Entity                         Nature of Claim     Claim Amount
   ------                         ---------------     ------------
Discus Master Ltd.                Contract            Unliquidated
CraigMuir Chambers
P.O. Box 71
Road Town, Tortola
British Virgin Islands

Trading LSIII                     Contract            Unliquidated
c/o Phil Baker
P.O. Box 656
Providenciales
Turks & Caicos Islands, BWI

IFX Markets Inc.                  Contract            Unliquidated
c/o Helen Lucking
House Account
One America Square
17 Crosswall, London
Tel: 011-44-207-890-8990

SMW Trading Company, Inc. Hse     Contract            Unliquidated
c/o Nancy Flanagan
141 West Jackson, Suite 380
Chicago, IL 60604
Tel: (312) 913-6100

Jump Trading, LLC                 Contract            Unliquidated
c/o Cary Harold
600 West Chicago Avenue
Suite 825
Chicago, IL 60610
Tel: (312) 836-0127

JEM Commodity Relative            Contract            Unliquidated
Value Fund L.P. Trading

Rotchford L. Barker               Contract            Unliquidated

BC Capital Fund A, LLC            Contract            Unliquidated

LakeShore Alt Financial Asset-    Contract            Unliquidated
Trading 2

2100 Capital Multi-Strategy       Contract            Unliquidated
Master GlobeOp Financial
Services

BC Capital Fund B, LLC            Contract            Unliquidated

Sentinel US Liquidity             Contract            Unliquidated
Fund, Ltd.

Dighton UTG Fund SPC obo          Contract            Unliquidated
Aggressive Portfolio

Sentinel Bank & Trust Ltd.        Contract            Unliquidated

Leviathan Diversified Fund 3XL    Contract            Unliquidated

Lake Shore Alt                    Contract            Unliquidated
Financial Funbd IV Ltd-Trading

Fortis Clearing                   Contract            Unliquidated
Americas LLC US
CFTC Reg 30.7

One York Property, LLC            Contract            Unliquidated

Bluepring Partners L.P.           Contract            Unliquidated

Stone Capital Group, Inc.         Contract            Unliquidated


SEQUIAM CORP: CEO's Purchase of Biometrics Investors Cures Default
------------------------------------------------------------------
Sequiam Corporation's founder, chief executive officer and
chairman of the board, Nick VandenBrekel, purchased 100% of
Biometrics Investors LLC in accordance with the June 20, 2007,
agreement between himself and Biometrics Investors LLC.

The transaction closed Wednesday, Aug. 15, 2007.  Subsequent to
the purchase by Mr. VandenBrekel, he sold the interest to an
unrelated third party.

As a result of the transaction the previously announced default
called by Biometrics Investors LLC has been cured.  After Mr.
VandenBrekel's purchase of Biometrics Investors LLC, the loan
agreement has been modified to make the loan interest free.  The
Term Loan 'A' has been fully funded.

Mr. VandenBrekel said, "I have enjoyed working with the previous
owners of Biometrics Investors LLC and I am pleased that the
purchase transaction has worked out to our mutual satisfaction.  I
wish them all the best and continued success."

He continued: "Sequiam has arrived at a crossroads and is facing a
very successful future, one that will require continued and
dedicated focus.  We have developed new partnerships, new products
and increased our client base.  In the next several weeks we shall
announce a host of exciting new initiatives that include additions
to our board of directors, new Sequiam team members in sales and
marketing, management, engineering and new financial partnerships.
I will be aggressively introducing Sequiam to the world through a
host of national and international speaking engagements.  Our
subsidiary companies in South Africa and China will actively
participate and support us with our growth opportunities."

Mr. VandenBrekel added, "After many years of research and
development that have resulted in such innovative products such as
the Black and Decker, Kwikset SmartScan biometric deadbolt,
currently carried by Home Depot, and the world's first Universal
Biometric Interface, it is time for Sequiam to claim its place as
the worlds leading innovator and developer of Consumer Lifestyle
Biometrics(TM)."

                       Going Concern Doubt

Tedder, James, Worden & Associates, P.A., expressed substantial
doubt about Sequiam Corp.'s ability to continue as a going concern
after it audited the company's financial statements for the years
ended Dec. 31, 2005 and 2004.  The auditing firm pointed to the
company's recurring losses from operations, its working capital
deficit and its shareholders' deficiency.

                          About Sequiam

Based in Orlando, Florida, Sequiam Corporation (OTCBB:SQUM) --
http://www.sequiam.com/ and http://www.sequiambiometrics.com/--   
develops, markets, and supports a portfolio of highly robust
proprietary biometrically enabled consumer lifestyle and
commercial products and OEM solutions.  Sequiam has offices in
Taiwan, China, and South Africa.


SHAW GROUP: Gets $50 Mil. Engineering Contract with Dagu Chemical
-----------------------------------------------------------------
The Shaw Group Inc. disclosed that its Energy & Chemicals Group
has been awarded a $50 million contract to provide technology and
basic engineering for a 500,000 metric tons per annum
ethylbenzene/styrene monomer plant in Tianjin, China, for Tianjin
Dagu Chemical Industry Co. Ltd.

The plant will be located in Tianjin Industrial Park, Lingang
Industry Area, near the city of Tianjin.  Shaw will also provide
procurement services for critical equipment in addition to
training and technical advisory services during plant construction
and start-up.

The new plant will utilize proprietary EBMax(SM) and styrene
technologies provided by Badger Licensing, LLC, a joint venture of
affiliates of The Shaw Group Inc. and ExxonMobil Chemical Company.

"We are pleased that we were selected for this project, which is
the largest ethylbenzene/styrene monomer project undertaken by
Shaw in China," said J.M. Bernhard Jr., chairman, president and
chief executive officer of Shaw. "China's chemical industry is
growing rapidly, and we look forward to successfully demonstrating
Shaw's ability to offer world class proprietary technologies and
services to our customers."

Based in Baton Rouge, Louisiana, The Shaw Group Inc. (NYSE: SGR)
-- http://www.shawgrp.com/-- provides services to the
environmental, infrastructure and homeland security markets,
including consulting, engineering, construction, remediation and
facilities management services to governmental and commercial
customers.  It is also a vertically integrated provider of
engineering, procurement, pipe fabrication, construction and
maintenance services to the power and process industries.  The
company segregates its business activities into four operating
segments: Environmental & Infrastructure; Energy & Chemicals;
Maintenance, and Fabrication, Manufacturing & Distribution.  In
January 2005, the company sold substantially all of the assets
of its Shaw Power Technologies, Inc. and Shaw Power Technologies
International, Ltd. units to Siemens Power Transmission and
Distribution Inc., a unit of Siemens AG.

The company has operations in Chile, China, Malaysia, the United
Kingdom and, Venezuela, among others.

                          *     *     *

Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit rating on The Shaw Group Inc. and removed it from
CreditWatch, where it was placed with negative implications in
October 2006.  S&P said the outlook is stable.

In addition, 'BB' senior secured debt rating was affirmed after
the $100 million increase to the company's revolving credit
facility.


SIMTROL INC: Posts $881,575 Net Loss in Quarter Ended June 30
-------------------------------------------------------------
Simtrol Inc. reported a net loss of $881,575 for the second
quarter ended June 30, 2007, compared with a net loss of $691,956
for the same period ended June 30, 20606.

Revenues were $41,900 and $35,056 for the three months ended
June 30, 2007 and 2006, respectively.  

The increase in net loss was due primarily to increased operating
expenses that resulted from increased personnel costs during the
current period, as well as expenses incurred in the company's
engagement of Triton Business Development Services.

At June 30, 2007, the company's consolidated balance sheet showed
$2.2 million in total assets, $389,172 in total liabilities, and
$1.8 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a0

                       Going Concern Doubt

Marcum & Kliegman LLC, in New York, expressed substantial doubt
about Simtrol Inc.'s ability to continue as a going concern after
auditing the company's consolidated financial statements for the
year ended Dec. 31, 2006.  The auditing firm reported that the
company has a working capital deficiency of $1,861,713 and has not
achieved a sufficient level of revenues to support its business
and has suffered recurring losses from operations.

As of June 30, 2007, the company had cash and cash equivalents
$1,942,820.  The company has an accumulated deficit of
approximately $69.0 million as of June 30, 2007.  The company has
relied on periodic investments in the form of common stock,
preferred stock, and convertible debt since the fourth quarter of
2001 to sustain its operations.  The company currently requires
substantial amounts of capital to fund current operations and the
continued development and deployment of its ONGOER(R), OnGuard,
and Curiax(TM) product lines.

                        About Simtrol Inc.

Simtrol Inc. -- http://www.simtrol.com/-- develops scalable  
software solutions that cost-effectively manage disparate devices
in courtrooms, operating rooms, and boardrooms to achieve
dramatically improved efficiency.  Simtrol's solutions are sold
directly and through professional system integrators, value-added
resellers (VARs) and other distributors who are supported by the
company's sales and technical support staff.


SITHE/INDEPENDENCE: S&P Holds "B" Rating on $559.5MM Secured Bonds
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' rating on
Sithe/Independence Funding Corp.'s $559.5 million senior secured
bonds (approximately $465 million outstanding) and removed the
company's ratings from CreditWatch with developing implications,
where they were placed in September 2006 following Dynegy's
announcement of the acquisition of LS Power's power plants.  The
outlook is stable.  This rating action follows an annual review of
the project and the stable outlook reflects that on Dynegy
Holdings Inc.
     
"The revision in outlook merely reflects our earlier revision on
Dynegy and does not reflect any change in the project's
fundamentals"," said Standard & Poor's credit analyst Swami
Venkataraman.  "The 'B' rating on Sithe/Independence's senior
secured bonds reflects Dynegy's credit risk due to its 100%
ownership of the project and the tolling agreements it has for
almost the entire output of the project" he added.
     
Sithe/Independence is a 1,000 MW combined-cycle, gas-turbine plant
in Scriba, New York.  The project is 100% owned by Sithe Energies
Inc. through direct and indirect ownership of Sithe Energies'
affiliates.  Dynegy, in turn, owns 100% of Sithe Energies.


TARRAGON CORP: Will Delay Filing of 10Q for Quarter Ended June 30
-----------------------------------------------------------------
Tarragon Corporation, in a regulatory filing with the Securities
and Exchange Commission on Aug. 9, 2007, disclosed that the filing
of its Quarterly Report on Form 10-Q for the second quarter ended
June 30, 2007, will be delayed beyond the SEC's filing deadline of
August 9, 2007, in order to provide additional time for Tarragon
to finalize its evaluation of property impairment charges and
other write-downs necessitated by the recent decision to sell
certain properties under current adverse market conditions.  
Tarragon currently expects to record impairment charges in excess
of $125 million.

Tarragon disclosed that it is currently experiencing liquidity
issues caused by the sudden and rapid deterioration in the real
estate credit markets.  This has resulted in Tarragon being unable
to complete approximately $50 million in financing transactions
that had been under negotiation and were expected to close in
August 2007.

Tarragon's business has been adversely affected by the continuing
and accelerated deterioration of the homebuilding industry in the
markets in which Tarragon operates, and in the Florida market in
particular.  These conditions have led to declines in new home
sales, increased use of sales discounts and other incentives and
increased interest and other carrying costs, and have adversely
affected Tarragon's gross margins from homebuilding sales as well
as its overall liquidity situation.  Tarragon has also incurred
additional lease-up and debt service costs associated with
apartment properties that had been targeted for conversion into
condominiums but that it subsequently decided to operate as rental
properties.

The company believes that these factors, combined with the
inability to obtain anticipated loan modifications and additional
financing, have materially affected Tarragon's liquidity,
including the ability to repay existing indebtedness as it becomes
due and meet other current obligations, and raise doubt about
Tarragon's ability to continue as a going concern.  In addition,
Tarragon currently is not in compliance with a financial covenant
contained in its existing subordinated debt and, after the
property impairment charges and other write-downs discussed above
are recorded, Tarragon will not be in compliance with certain net
worth maintenance and other financial covenants contained in this
and other debt agreements.  Tarragon has not made its August 2007
debt service payments as well as certain other vendor payments,
and Tarragon is seeking deferral of such payments while it
continues to negotiate to obtain debt and/or equity financing.  
Tarragon also currently owes approximately $37.0 million under its
unsecured line of credit with affiliates of William S. Friedman,
Tarragon's chief executive officer and chairman.  Tarragon and Mr.
Friedman have agreed that no further advances will be made under
this credit line.
     
Notwithstanding these issues, Tarragon believes that its real
estate portfolio and development platform currently have
significant equity value in excess of existing indebtedness.
Accordingly, Tarragon's board of directors has formed a special
committee of independent directors to evaluate strategic and
financial alternatives that may be available to Tarragon and its
stakeholders.  The special committee is retaining Lazard to act as
a financial adviser to Tarragon in evaluating its alternatives.
Alternatives to be considered are expected to include all
available forms and sources of financing, property sales and other
strategic transactions.  However, if Tarragon is unable to obtain
sufficient liquidity to fund its operations in the near-term, it
may be necessary for Tarragon to undertake such other actions as
may be appropriate in the light of its current liquidity
situation.  Tarragon does not intend to comment further publicly
with respect to the exploration of strategic and financial
alternatives unless a specific transaction or course of action is
authorized by its board of directors.

Tarragon previously filed a preliminary proxy statement with the
SEC related to the proposed pro rata, tax-free spin-off of its
homebuilding division as an independent, publicly traded company.
Due to current market conditions and the related impact on
Tarragon's financial condition, Tarragon has decided to postpone
the spin-off of the homebuilding business as it concentrates on
addressing its existing financial requirements.

                  About Tarragon Corporation

Tarragon Corporation -- http://www.tarragoncorp.com/-- develps
multifamily housing for rent and for sale. Tarragon's operations
are concentrated in the Northeast, Florida, Texas and Tennessee.

At March 31, 2007, the company's consolidated balance sheet showed
$2.01 billion in total assets, $1.71 billion in total liabilities,
$21.9 million in minority interest, and $274.1 million in total
stockholders' equity.


TARRAGON CORP: Receives Notice of Default from Barclays Capital
---------------------------------------------------------------
Tarragon Corp., in a regulatory filing with the Securities and
Exchange Commission on Aug. 15, 2007, disclosed that on Aug. 10,
2007, the company received a notice of default and demand from
Barclays Capital Real Estate Inc. related to six promissory notes  
made in favor of Barclays by certain direct or indirect wholly
owned subsidiaries of the company (the "Group I Subsidiaries").

At July 31, 2007, the aggregate amount outstanding under the
Barclays Notes was approximately $163.2 million, including the
unpaid principal balance and accrued interest payable under each
Barclays Note.  In connection with the Barclays Notes, the company
entered into an Amended and Restated Performance Guaranty (the
"Barclays Guaranty"), dated Oct. 10, 2006, in favor of Barclays.
The notice of default and demand alleges that the Group I
Subsidiaries failed to make payments due August 9, 2007, but does
not accelerate the Barclays Notes.  Instead, the notice makes a
demand for immediate payment by the company of $15 million,
together with interest, fees, expenses and other charges, which is
the maximum amount payable by the company under the Barclays
Guaranty.

On Aug. 10, 2007, the company received seven acceleration notices
from General Electric Capital related to certain loan agreements
that were previously executed by certain direct or indirect wholly
owned subsidiaries of the company.  Due to each Group II
Subsidiary's alleged failure to pay when due its interest payment
for the month of August 2007, the acceleration notices state that
GECC has elected to accelerate the amounts outstanding under the
GECC Loan Agreements and, consequently, the entire amount
outstanding is now immediately due and payable.  At July 31, 2007,
the aggregate amount outstanding under the GECC Loan Agreements
was approximately $185.7 million, including the unpaid principal
balance and any accrued interest payable under each GECC Loan
Agreement.

On Aug. 10, 2007, and Aug. 13, 2007, the company received eight
acceleration notices from Fannie Mae related to certain promissory
notes that were previously executed by certain direct or indirect
wholly owned subsidiaries of the company.  Due to each Group III
Subsidiary's alleged failure to pay when due its monthly payment
for the month of August 2007, the acceleration notices state that
Fannie Mae has elected to declare the entire amount of outstanding
indebtedness under each Multifamily Note immediately due and
payable without further demand.  At July 31, 2007, the aggregate
amount outstanding under the Multifamily Notes was approximately
$65.8 million, including the unpaid principal balance and any
accrued interest payable under each Multifamily Note.  In
connection with the notice, Fannie Mae has terminated the
company's license to collect rents from the properties owned by
each of the Group III Subsidiaries.  The Group III Subsidiaries
have also been instructed by Fannie Mae to hold any rents for
Fannie Mae and to apply such rents to either (1) bona fide
operating expenses owing to third parties in connection with the
operation of the properties or (2) the repayment of the
outstanding indebtedness under the Multifamily Notes.  In
connection with this alleged default and pursuant to corresponding
guarantees between the company and Fannie Mae, Fannie Mae is
alleging that the company is liable to Fannie Mae with full
recourse for, among other things, (1) all rents not applied first
to the payment of reasonable operating expenses as such operating
expenses become due and payable under the Multifamily Notes and
related documents and (2) each Schedule III Subsidiary's failure,
following default, to deliver to Fannie Mae on demand all rents
and security deposits relating to the properties.

In addition to the acceleration and demand notices, the company
has also received from various lenders during the month of August
seven notices alleging default on the part of the company or its
direct or indirect subsidiaries, each of which has reserved the
rights of the lender with respect to such indebtedness, but none
of which has made demand for payment.  At July 31, 2007, the
aggregate outstanding principal amount of such indebtedness was
approximately $515.4 million, including the unpaid principal
balances and any accrued interest.

The alleged events of default constitute a cross-default or event
of default under certain of the company's other loan agreements,
indentures, mortgages and other evidences of indebtedness, and the
lenders that are parties thereto may elect to exercise their
rights and remedies thereunder.  At July 31, 2007, the company and
its consolidated subsidiaries had approximately $1.6 billion of
outstanding indebtedness, including the indebtedness described
above.
     
On Aug. 13, 2007, the company received a Nasdaq Staff
Determination notice stating that the company is not in compliance
with NASDAQ Marketplace Rule 4310(c)(14) because it has not timely
filed its Quarterly Report on Form 10-Q for the period ended
June 30, 2007, and its common stock is therefore subject to
delisting from The NASDAQ Global Select Market, unless the company
requests a hearing before a NASDAQ Listing Qualifications Panel.

The company intends to request a hearing to review the NASDAQ
Staff Determination.  Pending a decision by the NASDAQ Listing
Qualifications Panel, the company's common stock will remain
listed on The NASDAQ Global Select Market.

                  About Tarragon Corporation

Tarragon Corporation -- http://www.tarragoncorp.com/-- develops  
multifamily housing for rent and for sale. Tarragon's operations
are concentrated in the Northeast, Florida, Texas and Tennessee.

At March 31, 2007, the company's consolidated balance sheet showed
$2.01 billion in total assets, $1.71 billion in total liabilities,
$21.9 million in minority interest, and $274.1 million in total
stockholders' equity.


TELTRONICS INC: Posts $1.5 Mil. Net Loss in Quarter Ended June 30
-----------------------------------------------------------------
Teltronics Inc. reported net loss of $1.5 million for the three
months ended June 30, 2007, as compared to net income of $755,000
for the same period in 2006.

The company has net loss of $2.6 million for the six months ended
June 30, 2007, as compared to a net income of $195,000 for the
same period in 2006.  

The net loss available to common shareholders for the three months
ended June 30, 2007, was $1.8 million as compared to net income of
$592,000 for the same period in 2006.

The net loss available to common shareholders for the six months
ended June 30, 2007, was $3 million as compared to a net loss of
$131,000 for the same period in 2006.

Operating expenses for the three months ended June 30, 2007 were
$3.7 million, as compared to $3.9 million for the same period in
2006.  

Operating expenses for the six months ended June 30, 2007, were
$7.8 million, as compared to $8.1 million for the same period in
2006.
    
"We continued to have a short fall in revenues in the second
quarter due to timing issues and a slow down in our New York
cabling business," Ewen Cameron, Teltronics' president and CEO,
said.  "This was compounded by the $570,000 of fees involved in
terminating the CapitalSource financing arrangement."

At June 30, 2007, the company's balance sheet showed total assets
$15.2 million and total liabilities of $19.6 million, resulting to
total shareholders' deficiency $4.4 million.

                      About Teltronics Inc.

Headquartered in Sarasota, Florida, Teltronics Inc. (OTCBB:
TELT) -- http://www.teltronics.com/-- provides communications    
solutions and services for businesses.  The company manufactures
telephone switching systems and software for small-to-large size
businesses and government facilities.  Teltronics offers a full
suite of Contact Center solutions -- software, services and
support -- to help their clients satisfy customer interactions.
Teltronics also provides remote maintenance hardware and
software solutions to help large organizations and regional
telephone companies effectively monitor and maintain their voice
and data networks.  The company serves as an electronic
contract manufacturing partner to customers in the US and
overseas.

The company designs, installs, develops, manufactures and
markets electronic hardware and application software products
and also engages in electronic manufacturing services in the
telecommunication industry.  The company's products are
classified into intelligent systems management, digital
switching systems, voice over Internet protocol, customer
contact management systems and emergency response systems.
Overall operations are classified into three reportable
segments: Teltronics, Inc., Teltronics Limited (UK) and Mexico.
Its Mexico office is located at Naucalpan de Juarez.


TIMKEN CO: Explores Strategic Alternatives to Accelerate Growth
---------------------------------------------------------------
The Timken Company disclosed changes to align the company around
continued improvement in operational performance and acceleration
of profitable growth.

Under the new model, Timken will operate with two major business
groups, the Steel Group and the Bearings and Power Transmission
Group, which is composed of four divisions -- Mobile Industries,
Process Industries, Aerospace & Defense and Distribution &
Services.  The company has named Michael C. Arnold as executive
vice president and president, Bearings and Power Transmission
Group. Salvatore J. Miraglia, Jr., will continue as president of
the Steel Group.

Timken has also named Jacqueline A. Dedo senior vice president,
Innovation and Growth.  In this role, Ms. Dedo will be responsible
for leading the company's strategic initiatives to accelerate the
pace of innovation and growth.

"With focused leadership and a strong balance sheet, we are well
positioned to aggressively pursue growth opportunities with the
potential to create exceptional value for customers and
shareholders," James W. Griffith, Timken's president and chief
executive officer said.  "In addition, as we implement this model,
we expect to benefit from faster, more effective decision-making
and less complexity in all parts of our business, allowing us to
drive further improvement in our financial performance."

The organizational changes are focused primarily on improving
Timken's operating effectiveness and are also anticipated to
streamline operations and eliminate redundancies.  When fully
implemented, the company expects to save approximately $10 million
to $20 million as a result of the changes.

Timken's new Bearings and Power Transmission Group includes four
divisions:

   * Mobile Industries: composed of the rail, off-highway,
     agriculture, heavy truck and passenger car and light truck
     market sectors;

   * Process Industries: encompasses the heavy industry, power
     transmission and energy market sectors;

   * Aerospace & Defense: serves the friction-management and
     power-transmission needs of commercial and military aviation
     customers through original equipment manufacturers and the
     aerospace aftermarket; and

   * Distribution & Services: provides a full range of bearings,
     seals, grease, condition monitoring and other products and
     services through distributors worldwide.

Timken will report its third-quarter 2007 financial results using
the existing Steel, Industrial and Automotive Groups.  Beginning
with the fourth quarter of 2007, the company expects to make a
change to its financial reporting, providing results for the Steel
Group as before, along with more detailed results for the new
Bearings and Power Transmission Group.

Headquartered in Canton, Ohio, The Timken Company (NYSE: TKR) --
http://www.timken.com/-- is a manufacturer of highly engineered
bearings and alloy steels.  It also provides related components
and services such as bearing refurbishment for the aerospace,
medical, industrial and railroad industries.  The company has
operations in Argentina, Australia, Belgium, Brazil, Canada,
China, Czech Republic, England, France, Germany, Hungary, India,
Italy, Japan, Korea, Mexico, Netherlands, Poland, Romania,
Russia, Singapore, South America, Spain, Taiwan, Turkey, United
States, and Venezuela and employs 27,000 employees.

                         *     *     *

The Timken Company carries Moody's Ba1 Long-Term Corporate
Family, Senior Unsecured Debt and Probability-of-Default
Ratings.  Moody's said the outlook was stable.


TIMKEN CO: Board Declares $0.17 Per Share Quarterly Dividend
------------------------------------------------------------
The Timken Company's board of directors has declared a quarterly
cash dividend of 17 cents per share, an increase of 1 cent per
share.  The dividend is payable on Sept. 5, 2007, to
shareholders of record as of Aug. 17, 2007.  It will be the
341st consecutive dividend paid on the common stock of the
company.

Headquartered in Canton, Ohio, The Timken Company (NYSE: TKR) --
http://www.timken.com/-- is a manufacturer of highly engineered
bearings and alloy steels.  It also provides related components
and services such as bearing refurbishment for the aerospace,
medical, industrial and railroad industries.  The company has
operations in Argentina, Australia, Belgium, Brazil, Canada,
China, Czech Republic, England, France, Germany, Hungary, India,
Italy, Japan, Korea, Mexico, Netherlands, Poland, Romania,
Russia, Singapore, South America, Spain, Taiwan, Turkey, United
States, and Venezuela and employs 27,000 employees.

                         *     *     *

The Timken Company carries Moody's Ba1 Long-Term Corporate
Family, Senior Unsecured Debt and Probability-of-Default
Ratings.  Moody's said the outlook was stable.


TRANSNATIONAL FINANCIAL: Bedinger Raises Going Concern Doubt
------------------------------------------------------------
Concord, Calif.-based Bedinger & Company expressed substantial
doubt about Transnational Financial Network, Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the year ended April 30,
2007.  The auditing firm pointed to the company's recurring
losses, negative cash flow from operations and repurchase request
from investors on mortgage loans
in default.

The company posted a $6,050,525 net loss on $7,309,748 of total
revenues for the year ended April 30, 2007, as compared with a
$1,952,612 net loss on $11,179,669 of total revenue in the prior
year.

At April 30, 2007, the company's balance sheet showed $3,830,366
in total assets and $7,026,803 in total liabilities, resulting in
a $3,196,437 stockholders' deficit.

A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?22a7

                  About Transanational Financial

San Francisco-based Transnational Financial Network, Inc. (AMEX:
TFN Other OTC: TRFN)-- http://www.transnational.com/--  
originates, funds, and sells mortgage loans secured by one to four
family residential properties principally in the San Francisco Bay
area, southern California, and Arizona.  The company operates in
two divisions, Wholesale and Retail.  The Wholesale division
closes and funds loans originated by independent third-party
mortgage brokers, as well as those originated through the
company's Retail division.  The Retail division originates retail
mortgage loans.


TRIARC COS: Unstable Market Delays Sale of Deerfield & Co. Stake
----------------------------------------------------------------
Triarc Companies Inc. said it was informed Thursday by the special
committee of the board of directors of Deerfield Triarc Capital
Corp. that Deerfield Triarc has not yet been able to complete on
acceptable terms the financing necessary for Deerfield Triarc to
consummate the previously announced acquisition by Deerfield
Triarc of Deerfield & Company LLC.

The delay in the consummation of the acquisition was due to the
current instability in the credit markets.  Deerfield Triarc has
advised Triarc Companies that it is continuing to work with its
lenders to obtain appropriate financing.

Under the definitive acquisition agreement, Deerfield Triarc's
obligation to complete the acquisition is subject to the receipt
by Deerfield Triarc of financing for the cash portion of the
purchase price and related transaction costs.

On Aug. 9, 2007, Deerfield Triarc's shareholders approved the
issuance in the acquisition of about 9.6 million Deerfield Triarc
shares.  Under the definitive agreement the parties have until
Oct. 19, 2007, to complete the transaction, unless extended by
mutual agreement.

                     About Deerfield Triarc

Headquartered in Lenexa, Kansas, Deerfield Triarc Capital Corp.
(NYSE: DFR) -- http://www.deerfieldtriarc.com/-- is a diversified   
financial company formed in 2004 to invest in real estate-related
securities and various other asset classes.  The company intends
to continue to qualify to be taxed as a real estate investment
trust, or REIT, for federal income tax purposes.  The objective is
to provide attractive returns to investors through a combination
of dividends and capital appreciation, which the company intends
to achieve by opportunistically investing in financial assets and
to construct an investment portfolio appropriately leveraged to
seek attractive risk-adjusted returns.  The company is externally
managed by Deerfield Capital Management LLC.

                    About Triarc Companies Inc.

Triarc Companies Inc. (NYSE: TRY.B or TRY) --
http://www.triarc.com/--  is a holding company and, through its   
subsidiaries, is currently the franchisor of the Arby's restaurant
system and the owner of approximately 94% of the voting interests,
64% of the capital interests and at least 52% of the profits
interests in Deerfield & Company LLC, an asset management firm.  
The Arby's restaurant system is comprised of approximately 3,600
restaurants, of which, as of Dec. 31, 2006, 1,061 were owned and
operated by the company's subsidiaries.

Deerfield & Company LLC, through its wholly-owned subsidiary,
Deerfield Capital Management LLC, is a Chicago-based asset manager  
offering a diverse range of fixed income and credit-related
strategies to institutional investors with about $13.2 billion
under management as of Dec. 31, 2006.

                   Sale-Leaseback Obligations

A significant number of the underlying leases for the company's
sale-leaseback obligations and its capitalized lease obligations,
as well as its operating leases, require or required periodic
financial reporting of certain subsidiary entities within its
restaurant segment or of individual restaurants, which in many
cases has not been prepared or reported.  The company has
negotiated waivers and alternative covenants with its most
significant lessors which substitute consolidated financial
reporting of its restaurant segment for that of individual
subsidiary entities and which modify restaurant level reporting
requirements for more than half of the affected leases.

Nevertheless, as of Dec. 31, 2006, the company said that it was
not in compliance, and remain not in compliance, with the
reporting requirements under those leases for which waivers and
alternative financial reporting covenants have not been
negotiated.  However, none of the lessors has asserted that they
are in default of any of those lease agreements.  The company
doesn't believe that this non-compliance will have a material
adverse effect on its consolidated financial position or results
of operations.


TXU CORP: Board Declares Common Dividend of 43.25 Cents Per Share
-----------------------------------------------------------------
TXU Corp.'s board of directors declared a regular quarterly
dividend of 43.25 cents per share on the common stock of the
company.  The dividend will be paid on Oct. 1, 2007, to
shareholders of record at the close of business on Sept. 7, 2007.
                     
Headquartered in Dallas, Texas, TXU Corp. (NYSE: TXU) --
http://www.txucorp.com/-- is an energy holding company that   
manages a portfolio of competitive and regulated energy
subsidiaries, primarily in Texas, including TXU Energy, Luminant,
and Oncor.  TXU Energy provides electricity and related services
to 2.1 million electricity customers in Texas.  Luminant has over
18,300 MW of generation in Texas, including 2,300 MW of nuclear
and 5,800 MW of coal-fueled generation capacity.  Oncor operates a
distribution and transmission system in Texas, providing power to
three million electric delivery points over more than 101,000
miles of distribution and 14,000 miles of transmission lines.

                         *     *     *

As reported in the Troubled Company Reporter on March 29, 2007,
Moody's Investors Service said that the proposed acquisition of
TXU Corp. by a consortium of private equity investors will likely
lead to a period of aggressive financing that could make TXU a
deeply speculative-grade rated company.  Currently, only TXU's
senior unsecured debt, at Ba1, is rated non-investment grade by
Moody's.


UNIGENE LABS: June 30 Balance Sheet Upside-Down by $15 Million
--------------------------------------------------------------
Unigene Laboratories Inc. reported on Aug. 10, 2007, its financial
results for the three months and six months ended June 30, 2007.

At June 30, 2007, the company's consolidated balance sheet showed
$18.1 million in total assets, $33.1 million in total liabilities,
resulting in a $15.0 million total stockhoders' deficit.

Net loss for the three months ended June 30, 2007, was
$1.3 million, compared with a net loss of $3.0 million for the
three months ended June 30, 2006.

Net loss for the six months ended June 30, 2007, was $1.5 million,
compared with a net loss of $6.2 million for the six months ended
June 30, 2006.

Revenue for the three months ended June 30, 2007, increased to
$4.7 milllion compared with $556,000 for the three months ended
June 30, 2006.  Revenue for the six months ended June 30, 2007,
increased to $11.0 million compared with $943,000 for the six
months ended June 30, 2006.  Revenue from Fortical sales and
royalties was $3.4 million and $7.8 million, respectively, for the
three months and six months ended June 30, 2007.

Fortical royalties were $1.1 million and $348,000 for the three
months ended June 30, 2007, and 2006, respectively, and
$2.9 million and $546,000 for the six months ended June 30, 2007,
and 2006, respectively.  Fortical sales were $2.3 million and
$4.9 million for the three months and six months ended June 30,
2007, respectively.  Sales of peptide to Novartis were $792,000
and $2.2 million for the three months and six months ended
June 30, 2007, respectively.  There were no product sales during
the first half of 2006.

Operating expenses were $5.8 million for the three months ended
June 30, 2007, compared with $3.3 million for the three months
ended June 30, 2006, and were $12.0 million for the six months
ended June 30, 2007, compared with $6.5 million for the six months
ended June 30, 2006.  The increases were primarily due to cost of
goods sold resulting from the increased product sales to Upsher-
Smith and Novartis.  The three months ended June 30, 2007, and
2006, includes $289,000 and $262,000, respectively, in expenses
for non-cash stock option compensation.  The six months ended
June 30, 2007 and 2006, includes $682,000 and $427,000,
respectively, in expenses for non-cash stock option compensation.

The company's cash balance at June 30, 2007 was $6,765,000, an
increase of approximately $3,407,000 from Dec. 31, 2006.  Accounts
receivable at June 30, 2007, were $2,608,000, an increase of
$1,368,000 from Dec. 31, 2006.

Deferred licensing fees increased $5.0 million from Dec. 31, 2006,
primarily due to the $5.5 million Phase III milestone payment
received from Novartis which was only partially recognized as
revenue in the first half of 2007.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a3

                       Going Concern Doubt

Grant Thornton LLP, in Edison, New Jersey, expressed substantial
doubt about Unigene Laboratories Inc.'s ability to continue as a
going concern after auditing the company's financial statements
for the years ended Dec. 31, 2006, and 2005.  The auditing firm
pointed to the company's recurring losses from operations and
working capital deficiency.  The auditing firm also stated that
the company has stockholders demand loans in default at Dec. 31,
2006.

To satisfy short-term liquidity needs, Jay Levy, the company's
chairman of the board and an officer, Warren Levy and Ronald Levy,
each a director and executive officer of Unigene, and another Levy
family member, from time to time have made loans to the company.  
The company has not made principal and interest payments on
certain loans when due.  The total amount owed aggregated
$15,737,517, of which approximately $8,900,000 in principal and
interest were in default, and on May 10, 2007 was restructured as
eight-year term notes, none of which are in default, with a fixed
simple interest rate of 9% per annum.

                   About Unigene Laboratories

Based in Fairfield, New Jersey, Unigene Laboratories Inc. (OTCBB:
UGNE) -- http://www.unigene.com/-- is a biopharmaceutical company  
focusing on the oral and nasal delivery of large-market peptide
drugs.  Due to the size of the worldwide osteoporosis market,
Unigene is targeting its initial efforts on developing calcitonin
and PTH-based therapies.


UNITED AMERICAN: Earns $432,497 in Second Quarter Ended June 30
---------------------------------------------------------------
United American Corp. reported net income of $432,497 for the
second quarter ended June 30, 2007, compared with net income of
$41,407 for the comparable period in 2006.

For the three months ended June 30, 2007, the company generated
total revenue of $7.7 million, compared to revenue of $1.9 million  
for the three months ended June 30, 2006.  The increase in revenue
is primarily attributable to increases in sales of VoIP
termination services in the company's brokered international
telecom routes.  

The increase in net income during the three months ended June 30,
2007, was primarily attributable to increased sales, partly offset
by an increase in commissions and wages and management fees for
the three months ended June 30, 2007.

At June 30, 2007, the company's consolidated financial statements
showed $2.3 million in total assets and $2.6 million in total
liabilities, resulting in a $2.3 million total stockholders'
equity (the correct figure should be a $310,790 total  
stockholders' deficit after deducting total liabilities from total
assets).

The company's consolidated balance sheet at June 30, 2007, also
showed strained liquidity with $1.9 million in total current
assets available to pay $2.6 million in total current liabilities.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?2293

                       Going Concern Doubt

Michael Pollack CPA, in Cherry Hill, New Jersey, expressed
substantial doubt about United American Corp.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the year ended Dec. 31,
2006.  Mr. Pollack pointed to the company's operating losses and
capital deficits.

At June 30, 2007, the company had an accumulated a deficit of
$5,291,209, and has a working capital deficiency of $688,515 as of
June 30, 2007.

                      About United American

Headquartered in Las Vegas, Nevada, United American Corp. (OTC BB:  
UAMA.OB) -- http://www.unitedamericancorp.com/  -- is a next-
generation, facilities-based, marketing and sales-oriented
telecommunications holding company.  It provides businesses and
individuals with a growing suite of innovative retail domestic and
international voice and data products and services using Voice
Over Internet Protocol (VoIP).  It also offers wholesale (carrier-
to-carrier) solutions.


UNIVERSAL COMPRESSION: Stockholders Supports Merger with Hanover
----------------------------------------------------------------
Universal Compression Holdings Inc. and Hanover Compressor Company
jointly reported that, at the companies' stockholders meetings,
the stockholders of each company approved by a substantial margin
the merger of the two companies into a new company, Exterran
Holdings Inc.

The stockholders of both companies also approved the adoption of
the Exterran 2007 Stock Incentive Plan and the Exterran Employee
Stock Purchase Plan.  

Universal and Hanover expect the merger to close Monday, Aug. 20,
2007.  On the day after the merger closing, Exterran's common
stock will begin trading under the symbol "EXH" on the New York
Stock Exchange, and the common stock of Hanover and Universal will
no longer be traded.

                     About Hanover Compressor

Headquartered in Houston, Texas, Hanover Compressor Company
(NYSE: HC) -- http://www.hanover-co.com/-- is a global market
leader in full service natural gas compression and a leading
provider of service, fabrication and equipment for oil and natural
gas production, processing and transportation applications.

               About Universal Compression Holdings

Headquartered in Houston, Texas, Universal Compression Holdings
Inc., (NYSE: UCO) -- http://www.universalcompression.com/-- is a
natural gas compression services company, providing a full range
of contract compression, sales, operations, maintenance and
fabrication services to the domestic and international natural gas
industry.

                           *     *     *

Standard and Poor's assigned BB on Universal Compression Holdings
Inc.'s long term foreign and local issuer credit rating on
November 2006.  The outlook is stable.


UNIVERSAL HOSPITAL: June 30 Balance Sheet Upside-Down by $243 Mil.
------------------------------------------------------------------
Universal Hospital Services, Inc. reported on Aug. 14, 2007, its  
financial results for the quarter and six months ended June 30,
2007.

At June 30, 2007, the company's consolidated balance sheet showed
$891.3 million in total assets, $647.5 million in total
liabilities, resulting in a $243.8 million total stockholders'
deficit.

Net loss for the quarter was $53.2 million, compared to a net loss
of $181,000 for the same quarter last year.  For the first six
months, UHS reported a net loss of $50.0 million versus net income
of $3.4 million for the same period of 2006.   The 2007 period
losses primarily reflect charges related to the sale of UHS to
Bear Stearns Merchant Banking on May 31, 2007, and include
transaction related expenses and debt extinguishment costs.

Total revenues were $65.6 million for the second quarter of 2007,
representing a $10.5 million or 19% increase from total revenues
of $55.1 million for the same period of 2006.  Through the first
six months of 2007, revenues increased by 14% to $129.1 million,
as compared to the same period of 2006.

Second quarter Adjusted EBITDA was $22.8 million, representing a
$3.3 million, or 17% increase from $19.5 million for the same
period of 2006.  Adjusted EBITDA for the first six months
increased $5.6 million, or 13% to $48.0 million from $42.4 million
in 2006.

"Our investments in people and technology to transition UHS to an
equipment lifecycle services company are paying off," commented
Gary Blackford, chairman and chief executive officer of UHS.  
"Nineteen percent top line growth with the challenges our hospital
customers are facing shows that we are bringing the solutions they
are looking for -- cost savings, staff productivity and improved
patient outcomes."

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a9

                     About Universal Hospital

Universal Hospital Services Inc. -- http://www.uhs.com/-- is a  
medical equipment lifecycle services company.  UHS offers
comprehensive solutions that maximize utilization, increase
productivity and support optimal patient care resulting in capital
and operational efficiencies.  UHS currently operates through more
than 75 offices, serving customers in all 50 states and the
District of Columbia.


VERTIS COMM: Merger Pact Signing With American Color Moved Today
----------------------------------------------------------------
Vertis Communications and American Color Graphics Inc. have agreed
to extend until Aug. 20, 2007, the signing of the definitive
merger agreement.  

After Aug. 20, 2007, the letter of intent will automatically
extend for a period of one week unless either party provides
written notice that it will not extend prior to the start of each
extension period.

The two companies reported the signing of a letter of intent to
merge on July 23, 2007, and are in the process of due diligence.

“We remain committed to this transaction subject to the timely and
satisfactory completion of on-going negotiations,” Mike DuBose,
chairman and CEO of Vertis, said.  “This proposed merger will
bring together the operations of ACG, one of the largest printing
and premedia companies in North America, into Vertis' nationwide
marketing and printing services platform.”

                   About American Color Graphics

Headquartered in Brentwood, Tennessee, American Color Graphics
Inc. -- http://www.americancolor.com/-- is engaged in printing of    
advertising inserts and newspaper products in the United States.
The company is a wholly owned subsidiary of ACG Holdings, Inc.

The company operates in two segments: print and premedia services.
Customers for its print services include about 230 national and
regional retailers and approximately 155 newspapers.  The premedia
services segment provides its customers with a solution for the
preparation and management of materials for printing, including
the design, creation and capture; manipulation; storage;
transmission, and distribution of images.

                    About Vertis Communications

Vertis Communications, fka Vertis Inc., a wholly owned subsidiary
of Vertis Holdings -- http://www.vertisinc.com/-- is a marketing   
partner to a number of clients, including several Fortune 500
companies.  The company offers consulting, creative, research,
direct mail, media, technology and production services.  It also
provides print advertising, direct marketing solutions, and
similar services to America's retail and consumer services
companies.

Vertis Inc. posted total stockholders' deficit as of Dec. 31,
2006, amounting to $550.1 million, resulting from total assets of
$844.7 million and total liabilities of $1.4 million.

                          *     *     *

As reported in the Troubled Company Reporter on July 27, 2007,
Moody's Investors Service placed the ratings of Vertis Inc. under
review for possible downgrade after reports of the company to
merge with American Color Graphics Inc.  Ratings placed under
review for possible downgrade: $350 million 10.875% senior notes
due 2009 - Caa1; $293 million 13 1/2% senior subordinated notes
due 2009 - Caa3; $350 million 9 3/4% senior secured second lien
notes due 2009 - B1; corporate family rating - Caa1; and
probability of default rating - Caa1.


ZI CORPORATION: Receives Nasdaq Staff Deficiency Letter
-------------------------------------------------------  
Zi Corporation disclosed that on Aug. 15, 2007, the company
received a NASDAQ Staff Deficiency Letter indicating that Zi is
not currently in compliance with the stockholders' equity, market
value of publicly held shares and total asset and revenue
requirements for continued listing on The NASDAQ Global Market as
set forth in NASDAQ Marketplace Rules 4450(a)(3), 4450(b)(1)(A)
and 4450(b)(1)(B).  The general consequence of not meeting
NASDAQ's continued listing requirements is delisting from NASDAQ.

In accordance with NASDAQ rules, thecCompany has been provided 30
calendar days, or until Sept. 10, 2007, to regain compliance with
the continued listing requirements of The NASDAQ Global Market.  
In the event the company is unable to meet the continued listing
requirements of The NASDAQ Global Market on or before Sept. 10,
2007, the company intends to apply to transfer its listing to The
NASDAQ Capital Market, the continued listing requirements of which
are less stringent than The NASDAQ Global Market.

                       About Zi Corporation

Headquartered in Calgary, Alberta, Zi Corporation (TSX: ZIC;
Nasdaq: ZICA) -- http://www.zicorp.com/-- is a technology company  
that delivers intelligent interface solutions to enhance the user
experience of wireless and consumer technologies.  The company
provides device manufacturers and network operators with a full
range of intuitive and easy-to-use input solutions, including:
eZiText for one-touch predictive text entry; eZiTypeTM for
keyboard prediction with auto-correction; Decuma(R) for predictive
pen-input handwriting recognition; and the Qix search and service
discovery engine to enhance the user experience and drive service
usage and adoption.

                       Going Concern Doubt

As at June 30, 2007, the company had an accumulated deficit of
$110.7 million and incurred a loss of $2.8 million from continuing
operations and used cash in operating activities of $341,093 for
the six month period ended June 30, 2007.  

The company is executing a business plan to allow it to continue
as a going concern. The company intends to achieve profitability
through cost containment and revenue growth.  The company can give
no assurance that it will be successful in executing this plan.
Should it fail to control its expenses, earn additional revenue
or, if needed, raise additional capital it may be forced to
suspend operations, and possibly even liquidate assets and wind-up
and dissolve the company.

At June 30, 2007, the company's consolidated balance sheet showed
$15.6 million in total assets, $6.9 million in total liabilities,
and $8.7 million in total stockholders' equity.


ZI CORPORATION: Posts $1.2 Mil. Net Loss in Quarter Ended June 30
-----------------------------------------------------------------
Zi Corporation reported on Aug. 10, 2007, its financial results
for the second quarter and first six months ended June 30, 2007.  
This year's second quarter marked the continued improvement of
company operations with an increase in revenues of 30 percent and
a reduction in net loss from continuing operations of 59 percent,
compared to the 2006 second quarter.  Sequentially, 2007 second
quarter revenues were up 33 percent from the seasonally lower
first quarter of this year.

Net loss for the 2007 second quarter was $1.2 million, compared to
a net loss of $3.0 million for the comparable prior year period.  
Net loss for this year's first six months was $2.2 million,
compared to a net loss of $5.3 million for the year-earlier
period.  

In the second quarter and first six months of 2006, Zi recorded a
loss of $200,000 and $600,000 respectively, which has been
reclassified in the 2007 comparative results as a loss from
discontinued operations of the company's minority interest in
privately-held Archer Education Group Inc.  Net loss in the first
six months of 2007 included a $600,000 gain on the disposal of
discontinued operations, resulting from the sale of Archer.

Revenue in the 2007 second quarter and first six months was
$3.5 million and $6.1 million, respectively, compared to
$2.7 million and $5.8 million in the 2006 second quarter and first
six months.  Revenue in the 2007 first quarter was $2.6 million.
The increases in revenue were due primarily to a number of the
company's customers reporting higher royalties, as well as
additional royalties resulting from the settlement of a dispute
over royalty reporting with a large Asian licensee.  The royalty
settlement amount included in this year's second quarter revenue
was $400,000.

Zi president and chief executive officer Milos Djokovic said: "The
results of the second quarter of 2007 demonstrate that our
strategic efforts to reshape Zi Corporation are working.  We
enjoyed our best overall quarterly results in more than two years,
in terms of revenue growth and our drive towards profitability.  
We continue to make important progress toward expanding our reach
in the global telecommunications and gaming markets."

In addition to finalizing the settlement of the longstanding
dispute with its major shareholder and a ruling in favor of all
defendants in a patent lawsuit against the Board of Regents of the
University of Texas (which has now been appealed), both of which
relieved Zi of significant legal expenses, the company made
several important announcements during the second quarter.  These
included:

  -- A license agreement with BCM Communication Co. Ltd., for the
     integration of Zi's eZiText(R) Chinese text input system onto
     WiFi handsets using WinCE platform.

  -- The launch of joyZtickTM version 1.0, a unique Chinese text
     input solution for mobile electronic devices without a full
     keypad.

  -- A partnership with MediaTek Inc., a global leader in consumer
     and communications integrated circuit solutions, to embed      
     Decuma(R) handwriting recognition technology in the MediaTek
     platform marketed to global handset manufacturers.

  -- A license agreement for the Japanese version of Decuma with
     Hitachi Ltd., which allows Japanese users to easily and
     quickly enter text into industrial applications.

  -- The deployment of the Korean version of Decuma by Nintendo
     for use with its Nintendo DSTM handheld video game system.

Djokovic said that Zi is positioned for the future.  "The issues
and litigation with our major shareholder are now resolved, and so
is, subject to the outcome of the appeal, the University of Texas
suit.  Our entire product line, including QixTM, our search and
service discovery engine, is being well received in the market and
we have an invigorated management team that is dedicated to the
future success of Zi."

Djokovic also said that Zi continues to be in serious discussions
for Qix with several of the world's largest wireless operations,
and its pipeline of prospects for Qix has increased with both
near-term and longer-term licensing opportunities.

The company's balance sheet as of June 30, 2007 showed cash and
cash equivalents of $5.5 million, plus $2.5 million that is
classified as restricted and not fully available to fund
operations outside of China.

"Our financial results have improved, thanks in part to our
strategic efforts in two key areas: our focus on increasing
revenue, which includes more stringent management of royalty
payments, and the cost reduction programs we implemented last
year," Djokovic said.  "We have taken a much more aggressive
approach to monitoring and managing our royalties which, when
coupled with the fact that some of our larger customers are
enjoying higher shipping volumes, has significantly helped our
revenue base.  Also, the company-wide cost-reduction efforts
continue to be very successful as we are substantially meeting our
previously announced cost reduction targets for the year.  The
success of these two efforts bodes well for our operational
performance for the rest of the year.  These steps are consistent
with our previously-stated goal of achieving cash flow break-
even."

Sales, general and administrative expense for the 2007 second
quarter and first six months was $3.1 million and $5.7 million,
respectively, compared to $3.0 million and $5.5 million for the
second quarter and first six months of 2006.  SG&A expense for
this year's first quarter was $2.7 million.  SG&A increased
slightly primarily due to professional fees relating to the audit
by Canada Revenue Agency of the company's cross border
transactions, Sarbanes Oxley compliance, and additional fees
incurred to register for resale the shares issued during the
private placement.  

The company continues to invest in new product features and
enhancements to software language databases along with continued
investment in its Decuma handwriting recognition software and Qix
mobile search and discovery solution.  PR&D expense, net of
capitalized costs, for the 2007 second quarter and first six
months was $600,000 and $1.1 million, respectively, compared to
$1.1 million and $2.1 million in the prior year periods.  The
company capitalized $300,000 and $800,000 of PR&D expense in the
2007 second quarter and first six months, compared to $400,000  
and $800,000 million in the second quarter and first six months of
2006.

Legal costs for the 2007 second quarter and first six months were
$400,000 and $900,000, respectively, compared to $800.000 and
$1.7 million in year-earlier periods.  The year-over-year
decreases in legal expense were due to decreased activity in the
University of Texas action.  Additionally, there were fewer fees
incurred as a result of the settlement with the major shareholder
previously mentioned.

At June 30, 2007, the company's consolidated balance sheet showed
$15.6 million in total assets, $6.9 million in total liabilities,
and $8.7 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2007, are available for
free at http://researcharchives.com/t/s?22a2

                       Going Concern Doubt

As at June 30, 2007, the company had an accumulated deficit of
$110.7 million and incurred a loss of $2.8 million from continuing
operations and used cash in operating activities of $341,093 for
the six month period ended June 30, 2007.  

The company is executing a business plan to allow it to continue
as a going concern. The company intends to achieve profitability
through cost containment and revenue growth.  The company can give
no assurance that it will be successful in executing this plan.
Should it fail to control its expenses, earn additional revenue
or, if needed, raise additional capital it may be forced to
suspend operations, and possibly even liquidate assets and wind-up
and dissolve the company.

During the first quarter of 2007, the company completed an
essential part of its business plan by completing a private
placement for net proceeds of $5.5 million.  In the first half of
2007 compared to the first half of 2006, operating expenses
decreased and revenues increased, resulting in reduced net losses
from continued operations.

                       About Zi Corporation

Headquartered in Calgary, Alberta, Zi Corporation (TSX: ZIC;
Nasdaq: ZICA) -- http://www.zicorp.com/-- is a technology company  
that delivers intelligent interface solutions to enhance the user
experience of wireless and consumer technologies.  The company
provides device manufacturers and network operators with a full
range of intuitive and easy-to-use input solutions, including:
eZiText for one-touch predictive text entry; eZiTypeTM for
keyboard prediction with auto-correction; Decuma(R) for predictive
pen-input handwriting recognition; and the Qix search and service
discovery engine to enhance the user experience and drive service
usage and adoption.


* Donlin Recano To Provide Our Lady of Mercy Bankruptcy News
------------------------------------------------------------
Donlin Recano and Company Inc. will provide web-based information
services to creditors in Our Lady of Mercy Medical Center and its
debtor-affiliates' bankruptcy cases.

Our Lady of Mercy Medical Center and O.L.M. Parking Corporation
recently filed for Chapter 11 bankruptcy protection in the United
States Bankruptcy Court of the Southern District of New York.

As reported in the Troubled Company Reporter on Aug. 2, 2007,
the court retained Donlin Recano as the communications agent for
the Debtors' Official Committee of Unsecured Creditors.  The firm
will help the committee comply with its obligations under the
Bankruptcy Code and Procedures.

Craig E. Freeman, Esq. of Alston & Bird LLP New York office
represents the Committee of Unsecured Creditors in the case.

As directed by the committee and its counsel, the firm will also
print and serve documents.

"[I'm] happy to provide important case information to creditors
on an efficient, cost-effective platform that's easy for creditors
to use and navigate when they seek specific information" Managing
Director at Donlin Recano, Scott Y. Stuart, Esq., said.

                     About Our Lady of Mercy

Based in Bronx, New York, Our Lady of Mercy Medical Center
-- http://www.olmhs.org/-- provides health care services.  The         
medical center is a member of the Montefiore Health System and
is a University affiliate of New York Medical College.  The
company and its debtor-affiliate, O.L.M. Parking Corporation,
sought chapter 11 protection on March 8, 2007 (Bankr. S.D.N.Y.
Case Nos. 07-10609 and 07-10610).  Frank A. Oswald, Esq. at Togut,
Segal & Segal LLP, and Burton S. Weston, Esq., at Garfunkel, Wild
& Travis, P.C., represent the Debtors in their restructuring
efforts.  The Garden City Group, Inc., is the Debtors' claims and
noticing agent.  Martin G. Bunin, Esq., Craig E. Freeman, Esq.,
and Catherine R. Fenoglio, Esq., at Alston & Bird LLP, represent
the Official Committee of Unsecured Creditors.  Daniel T.
McMurray, of Focus Management Group, is the Patient Care Ombudsman
and is represented by Mark I. Fishman, Esq., at Neubert, Pepe &
Monteith, P.C.  When the Debtors filed for protection from their
creditors, they listed total assets of $91 million and total
liabilities of $151 million.

                      About Donlin Recano

Headquartered in New York City, Donlin Recano --
http://www.donlinrecano.com/-- is a claims management company
that has served over 200 national clients across a broad range
of industries and business sectors.  Working with counsel,
turnaround advisors and the affected company, Donlin Recano helps
organize and guide Chapter 11 clients through administrative
bankruptcy tasks, including provision of Web site-accessible
information, formation of professional call centers, management
of claims, balloting, distribution and other administrative
services.  The company also provides Web based information
services for creditors committees as required by The Bankruptcy
Abuse Prevention and Consumer Protection Act of 2005.


* Fitch Places All Classes from 58 Transactions Under Neg. Watch
----------------------------------------------------------------
Fitch Ratings has placed all classes of 58 U.S. RMBS subprime
transactions backed by pools of closed-end second-liens on Rating
Watch Negative.  This action includes all classes from these
transactions previously placed on Rating Watch Negative.  The 58
transactions have an aggregate outstanding balance of
approximately $12.1 billion.  35 of the transactions were
originated in 2005, 22 were originated in 2006, and one this year.  
These transactions comprise the entirety of Fitch's rated
portfolio of CES RMBS from those vintages.

Although the performance of individual transactions varies, the
CES sector as a whole has significantly underperformed from
original expectations.  Ongoing pressure from the combination of a
declining housing market, weak loan underwriting standards and
interest rate resets on the associated adjustable-rate first
liens, has led to high delinquencies, rising losses and a rapid
deterioration of credit enhancement for these securities.

Fitch is adapting its surveillance criteria for recent vintage
subprime to the CES sector.  Fitch will resolve the Negative
Rating Watch through the application of updated criteria for
expected loss and loss coverage.

This is a list of the second-lien transactions and classes placed
(or remaining on) Rating Watch Negative:

CS First Boston Mortgage Securities Corp HEMT 2005-2:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1;
  -- Class B2.
  
CS First Boston Mortgage Securities Corp HEMT 2005-3:
  -- Class A1;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class B1;
  -- Class B2.

CS First Boston Mortgage Securities Corp HEMT 2005-4:
  -- Class A3;
  -- Class A4;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9A;
  -- Class M9F;
  -- Class B1;
  -- Class B2.

CS First Boston Mortgage Securities Corp HEMT 2005-5:
  -- Class A1A;
  -- Class A1F1;
  -- Class A1F2;
  -- Class A2A;
  -- Class A2F;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1.

GS Mortgage Securities Corporation Trust 2005-S1:
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3.

GS Mortgage Securities Corporation Trust 2005-S2:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class B2;
  -- Class B3;
  -- Class M4 remains on Rating Watch Negative;
  -- Class B1 remains on Rating Watch Negative.

Irwin Whole Loan Home Equity Trust 2005-A:
  -- Class A-3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7.

MASTR Second Lien Trust 2005-1:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7.

Merrill Lynch Mortgage Investors Trust 2005-NCA:
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3 remains on Rating Watch Negative;
  -- Class B4 remains on Rating Watch Negative;
  -- Class B5 remains on Rating Watch Negative.

Merrill Lynch Mortgage Investors Trust 2005-NCB:
  -- Class A1B;
  -- Class M1;
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4;
  -- Class B5.

Merrill Lynch Mortgage Investors Trust 2005-SL2:
  -- Class M1;
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4;
  -- Class B5.

Merrill Lynch Mortgage Investors Trust 2005-SL3:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B5;
  -- Class B4 remains on Rating Watch Negative.

Merrill Lynch Mortgage Investors Trust 2005-SL1:
  -- Class M3;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4;
  -- Class B5.

SACO I Trust 2005-1:
  -- Class A
  -- Class M1;
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3.

SACO I Trust 2005-2:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-3:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-4:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-5 Group 1:
  -- Class IA;
  -- Class IM1;
  -- Class IM2;
  -- Class IM3;
  -- Class IM4;
  -- Class IM5;
  -- Class IB1;
  -- Class IB2;
  -- Class IB3;
  -- Class IB4.

SACO I Trust 2005-6:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-7:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-10 Group 1:
  -- Class IA;
  -- Class IM;
  -- Class IB1;
  -- Class IB2;
  -- Class IB3;
  -- Class IB4.

SACO I Trust 2005-10 Group 2:
  -- Class IIA1;
  -- Class IIA3;
  -- Class IIM1;
  -- Class IIM2;
  -- Class IIM3;
  -- Class IIM4;
  -- Class IIM5;
  -- Class IIM6;
  -- Class IIB1;
  -- Class IIB2;
  -- Class IIB3;
  -- Class IIB4.

SACO I Trust 2005-8:
  -- Class A1;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-9:
  -- Class A1;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.

SACO I Trust 2005-WM1:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4;
  -- Class B5.

Soundview Home Equity Loan Trust 2005-A:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class M10;
  -- Class M11;
  -- Class B1;
  -- Class B2.

Soundview Home Equity Loan Trust 2005-B:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class M10;
  -- Class M11;
  -- Class M12.

Structured Asset Securities Corp., Home Equity 2005-S1:
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class B1;
  -- Class B2;
  -- Class B3.
  
Structured Asset Securities Corp., Home Equity 2005-S2:
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class M10;
  -- Class B1.
  
Structured Asset Securities Corp., Home Equity 2005-S3:
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class M10;
  -- Class M11;
  -- Class B1.
  
This is a continued list of the second-lien transactions and
classes placed (or remaining on) Rating Watch Negative:
  
Structured Asset Securities Corp., Home Equity 2005-S5:
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class B1;
  -- Class B2.
  
Structured Asset Securities Corp., Home Equity 2005-S6:
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1;
  -- Class B2;
  -- Class B3.
  
Structured Asset Securities Corp., Home Equity 2005-S7:
  -- Class A1;
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B.
  
Terwin Mortgage Trust 2005-5SL:
  -- Class A1;
  -- Class M1a;
  -- Class M1b;
  -- Class M2;
  -- Class M3;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.
  
Terwin Mortgage Trust 2005-7SL
  -- Class A1;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4;
  -- Class B5.
  
Ace Securities Corporation 2006-SL2:
  -- Class A;
  -- Class M1;
  -- Class M2A;
  -- Class M2B;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6A;
  -- Class M6B;
  -- Class M8;
  -- Class M9A;
  -- Class M9B;
  -- Class B1;
  -- Class M7 remains on Rating Watch Negative.
  
C-BASS 2006-SL1:
  -- Class A1;
  -- Class A2;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class B1 remains on Rating Watch Negative;
  -- Class B2 remains on Rating Watch Negative;
  -- Class B3 remains on Rating Watch Negative;
  -- Class B4 remains on Rating Watch Negative;
  -- Class B5 remains on Rating Watch Negative.
  
CS First Boston Mortgage Securities Corp HEMT 2006-1:
  -- Class A1A1;
  -- Class A1A2;
  -- Class A1B;
  -- Class A1F;
  -- Class A2;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class B1;
  -- Class M9 remains on Rating Watch Negative.
  
CS First Boston Mortgage Securities Corp HEMT 2006-2 Fixed
seconds:
  -- Class 1A1;
  -- Class 1A2;
  -- Class 1A3;
  -- Class 1M1;
  -- Class 1M2;
  -- Class 1M3;
  -- Class 1M4;
  -- Class 1M5;
  -- Class 1M6;
  -- Class 1M7;
  -- Class 1M8;
  -- Class 1B1;
  -- Class 1B2;
  -- Class 1M9 remains on Rating Watch Negative.
  
CS First Boston Mortgage Securities Corp HEMT 2006-3:
  -- Class A1;
  -- Class A2;
  -- Class A3;
  -- Class M1;
  -- Class M10;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B2;
  -- Class B1 remains on Rating Watch Negative.
  
CS First Boston Mortgage Securities Corp HEMT 2006-4:
  -- Class A1;
  -- Class A2;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class B1;
  -- Class B2;
  -- Class M9 remains on Rating Watch Negative.
  
Countrywide Asset Backed Securities 2006-SPS1:
  -- Class A remains on Rating Watch Negative;
  -- Class M1 remains on Rating Watch Negative;
  -- Class M2 remains on Rating Watch Negative;
  -- Class M3 remains on Rating Watch Negative;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5 remains on Rating Watch Negative;
  -- Class M6 remains on Rating Watch Negative;
  -- Class M7 remains on Rating Watch Negative.
  
Countrywide Asset Backed Securities 2006-SPS2:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8 remains on Rating Watch Negative;
  -- Class M9 remains on Rating Watch Negative;
  -- Class B remains on Rating Watch Negative.
  
First Franklin Mortgage Loan Trust 2006-FFA:
  -- Class A1;
  -- Class A2;
  -- Class A3;
  -- Class A4;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1;
  -- Class B2.
  
Fremont Home Loan Trust 2006-B Pool 2:
  -- Class SLA;
  -- Class SLM1;
  -- Class SLM2;
  -- Class SLM3 remains on Rating Watch Negative;
  -- Class SLM4 remains on Rating Watch Negative;
  -- Class SLM5 remains on Rating Watch Negative;
  -- Class SLM6 remains on Rating Watch Negative;
  -- Class SLM7 remains on Rating Watch Negative.
  
  
GS Mortgage Securities Corporation Trust 2006-S1:
  -- Class A1;
  -- Class A2A;
  -- Class A2B;
  -- Class M1;
  -- Class M2 remains on Rating Watch Negative;
  -- Class M3 remains on Rating Watch Negative;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5 remains on Rating Watch Negative;
  -- Class M6 remains on Rating Watch Negative.
  
GS Mortgage Securities Corporation Trust 2006-S2:
  -- Class A1A;
  -- Class A1B;
  -- Class A2;
  -- Class A3;
  -- Class M1;
  -- Class M2;
  -- Class M3 remains on Rating Watch Negative;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5 remains on Rating Watch Negative;
  -- Class M6 remains on Rating Watch Negative.
  
IndyMac ABS, Inc., Home Equity 2006-A:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class M10 remains on Rating Watch Negative.
  
Merrill Lynch Mortgage Investors Trust 2006-SL2:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9 remains on Rating Watch Negative;
  -- Class B1 remains on Rating Watch Negative;
  -- Class B2 remains on Rating Watch Negative.
  
New Century Mortgage Corporation 2006-S1:
  -- Class A1 remains on Rating Watch Negative;
  -- Class A2a remains on Rating Watch Negative;
  -- Class A2b remains on Rating Watch Negative;
  -- Class M1 remains on Rating Watch Negative;
  -- Class M2 remains on Rating Watch Negative;
  -- Class M3 remains on Rating Watch Negative;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5;
  -- Class M6.
  
Soundview Home Equity Loan Trust 2006-A Aggregate Pool:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class M10;
  -- Class M12;
  -- Class M11 remains on Rating Watch Negative.
  
Structured Asset Securities Corp., Home Equity 2006-ARS1:
  -- Class A1;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5 remains on Rating Watch Negative;
  -- Class M6 remains on Rating Watch Negative;
  -- Class M7 remains on Rating Watch Negative;
  -- Class M8 remains on Rating Watch Negative.
  
Structured Asset Securities Corp., Home Equity 2006-S1:
  -- Class A1;
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class M3 remains on Rating Watch Negative;
  -- Class M4 remains on Rating Watch Negative;
  -- Class M5 remains on Rating Watch Negative;
  -- Class M6 remains on Rating Watch Negative;
  -- Class M7 remains on Rating Watch Negative;
  -- Class M8 remains on Rating Watch Negative.
  
Structured Asset Securities Corp., Home Equity 2006-S2:
  -- Class A;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class M4;
  -- Class M5;
  -- Class M6;
  -- Class M7;
  -- Class M8;
  -- Class M9;
  -- Class B1;
  -- Class B2;
  -- Class B3.
  
Terwin Mortgage Trust 2006-6 Group 2:
  -- Class IIA1;
  -- Class IIA2;
  -- Class IIM1a;
  -- Class IIM1b;
  -- Class IIM2;
  -- Class IIM3;
  -- Class IIB1;
  -- Class IIB2;
  -- Class IIB3;
  -- Class IIB4.
  
Terwin Mortgage Trust 2006-8 Group 2:
  -- Class IIA1;
  -- Class IIA2;
  -- Class IIM1;
  -- Class IIM2;
  -- Class IIM3;
  -- Class IIB1;
  -- Class IIB2;
  -- Class IIB3;
  -- Class IIB4;
  -- Class IIB5.
  
C-BASS 2007-SL1:
  -- Class A1;
  -- Class A2;
  -- Class M1;
  -- Class M2;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4.
  
Terwin Mortgage Trust 2006-HF1:
  -- Class A1a;
  -- Class A1b;
  -- Class M1;
  -- Class M2;
  -- Class M3;
  -- Class B1;
  -- Class B2;
  -- Class B3;
  -- Class B4 Remains on Rating Watch Negative;
  -- Class B5;
  -- Class B6.
  
Definition of Rating Watch: Ratings are placed on Rating Watch to
notify investors that there is a reasonable probability of a
rating change and the likely direction of such change.  These are
designated as 'Positive', indicating a potential upgrade,
'Negative', for a potential downgrade, or 'Evolving', if ratings
may be raised, lowered or maintained.  Rating Watch is typically
resolved over a relatively short period.


* Moody's Assessed 705 Tranches from Mortgage Loans Transactions
----------------------------------------------------------------
Moody's Investors Service downgraded 691 tranches and placed under
review for possible downgrade 14 tranches from transactions backed
by closed-end-second lien subprime mortgage loans.  

Complete rating actions are:

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
ASL1

-- Cl. M-8, Downgraded to Ba1 from Baa2
-- Cl. M-9, Downgraded to Ba2 from Baa3
-- Cl. M-10, Downgraded to B2 from Ba1

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
SL1

-- Cl. M-3, Downgraded to A2 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to Ba3 from A3
-- Cl. M-7, Downgraded to B3 from Baa1
-- Cl. M-8, Downgraded to Ca from Ba2
-- Cl. M-9, Downgraded to C from Ba3
-- Cl. B-1, Downgraded to C from Caa1

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
SL2

-- Cl. A, Downgraded to A1 from Aa1
-- Cl. M-1, Downgraded to Baa1 from Aa3
-- Cl. M-2A, Downgraded to Ba1 from A2
-- Cl. M-2B, Downgraded to Ba1 from A2
-- Cl. M-3, Downgraded to Ba3 from A3
-- Cl. M-4, Downgraded to B1 from Baa1
-- Cl. M-5, Downgraded to Ca from Baa2
-- Cl. M-6A, Downgraded to C from Ba3
-- Cl. M-6B, Downgraded to C from Ba3
-- Cl. M-7, Downgraded to C from B3
-- Cl. M-8, Downgraded to C from Caa3
-- Cl. M-9A, Downgraded to C from Caa3
-- Cl. M-9B, Downgraded to C from Caa3

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
SL3

-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa2 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. M-7, Downgraded to B1 from Baa1
-- Cl. M-8, Downgraded to Ca from Baa2
-- Cl. M-9, Downgraded to C from Baa3
-- Cl. B-1, Downgraded to C from Ba1

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
SL4

-- Cl. M-8, Downgraded to Ba1 from Baa2
-- Cl. M-9, Downgraded to B1 from Baa3
-- Cl. M-10, Downgraded to Ca from Ba1

Issuer: American Home Mortgage Investment Tr 2006-3

-- Cl. IV-A, Downgraded to Aa2 from Aaa
-- Cl. IV-M-1, Downgraded to Aa3 from Aaa
-- Cl. IV-M-2, Downgraded to A3 from Aa1
-- Cl. IV-M-3, Downgraded to Baa1 from Aa2
-- Cl. IV-M-4, Downgraded to Baa2 from Aa2
-- Cl. IV-M-5, Downgraded to Baa3 from A1
-- Cl. IV-M-6, Downgraded to Ba1 from A2
-- Cl. IV-M-7, Downgraded to Ba2 from A3
-- Cl. IV-M-8, Downgraded to Ba3 from Baa1
-- Cl. IV-M-9, Downgraded to B3 from Baa2

Issuer: American Home Mortgage Investment Trust 2006-2

-- Cl. IV-A, Downgraded to Aa1 from Aaa
-- Cl. IV-M-1, Downgraded to A1 from Aa2
-- Cl. IV-M-2, Downgraded to Baa3 from A2
-- Cl. IV-M-3, Downgraded to Ba2 from Baa1
-- Cl. IV-M-4, Downgraded to B1 from Baa2
-- Cl. IV-M-5, Downgraded to B3 from Baa3

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL1

-- Cl. A, Downgraded to Aa3 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa2 from Aa2
-- Cl. M-3, Downgraded to Ba1 from Aa3
-- Cl. M-4, Downgraded to Ba3 from A1
-- Cl. M-5, Downgraded to Ca from A2
-- Cl. M-6, Downgraded to C from A3
-- Cl. B-1, Downgraded to C from Baa1
-- Cl. B-2, Downgraded to C from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL2

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba3 from A2
-- Cl. M-6, Downgraded to Ca from A3
-- Cl. B-1, Downgraded to C from Baa1
-- Cl. B-2, Downgraded to C from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL3

-- Cl. A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aaa
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to B1 from A3
-- Cl. B-1, Downgraded to Ca from Baa1
-- Cl. B-2, Downgraded to C from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL4

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aaa
-- Cl. M-2, Downgraded to A1 from Aa2
-- Cl. M-3, Downgraded to A2 from Aa2
-- Cl. M-4, Downgraded to Baa2 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. B-1, Downgraded to B3 from Baa1
-- Cl. B-2, Downgraded to C from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL5

-- Cl. I-A, Downgraded to Aa2 from Aaa
-- Cl. II-A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to A3 from Aa3
-- Cl. M-4, Downgraded to Baa2 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. B-1, Downgraded to Ba2 from Baa1
-- Cl. B-2, Downgraded to B3 from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: Bear Stearns Mortgage Funding Trust 2006-SL6

-- Cl. I-A, Downgraded to Aa2 from Aaa
-- Cl. II-A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to A3 from Aa3
-- Cl. M-4, Downgraded to Baa2 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. B-1, Downgraded to Ba2 from Baa1
-- Cl. B-2, Downgraded to Ba3 from Baa2
-- Cl. B-3, Downgraded to Caa1 from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2006-SL1

-- Cl. M-2, Downgraded to A1 from Aa2
-- Cl. M-3, Downgraded to A2 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa2 from A2
-- Cl. M-6, Downgraded to Baa3 from A3
-- Cl. B-1, Downgraded to Ba2 from Baa1
-- Cl. B-2, Downgraded to B2 from Baa2
-- Cl. B-3, Downgraded to Caa1 from Baa3
-- Cl. B-4, Downgraded to C from Ba1
-- Cl. B-5, Downgraded to C from Ba2

Issuer: CSFB Home Equity Mortgage Trust 2006-1

-- Cl. M-2, Downgraded to A1 from Aa2
-- Cl. M-3, Downgraded to A2 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa2 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. M-7, Downgraded to Ba3 from Baa1
-- Cl. M-8, Downgraded to B1 from Baa2
-- Cl. M-9, Downgraded to Ca from Baa3
-- Cl. B-1, Downgraded to C from Ba1

Issuer: CSFB Home Equity Mortgage Trust 2006-3

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. A-2, Downgraded to Aa2 from Aaa
-- Cl. A-3, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to A3 from Aa1
-- Cl. M-3, Downgraded to Baa2 from Aa2
-- Cl. M-4, Downgraded to Ba1 from Aa3
-- Cl. M-5, Downgraded to Ba3 from A1
-- Cl. M-6, Downgraded to B2 from A2
-- Cl. M-7, Downgraded to Ca from A3
-- Cl. M-8, Downgraded to C from Baa1
-- Cl. M-9, Downgraded to C from Baa2
-- Cl. M-10, Downgraded to C from B3
-- Cl. B-1, Downgraded to C from Caa1
-- Cl. B-2, Downgraded to C from Caa2

Issuer: CSFB Home Equity Mortgage Trust 2006-4

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. A-2, Downgraded to Aa2 from Aaa
-- Cl. A-3, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Baa2 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba2 from A2
-- Cl. M-6, Downgraded to Ba3 from A3
-- Cl. M-7, Downgraded to Caa1 from Baa1
-- Cl. M-8, Downgraded to C from Baa2
-- Cl. M-9, Downgraded to C from Baa3
-- Cl. B-1, Downgraded to C from Caa1
-- Cl. B-2, Downgraded to C from Caa2

Issuer: CWABS Asset-Backed Certificates Trust 2006-SPS1

-- Cl. A, Downgraded to A2 from Aaa
-- Cl. M-1, Downgraded to A3 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Ba1 from Aa3
-- Cl. M-4, Downgraded to Ba3 from A1
-- Cl. M-5, Downgraded to B1 from A2
-- Cl. M-6, Downgraded to Caa1 from Baa2
-- Cl. M-7, Downgraded to Ca from Ba1
-- Cl. M-8, Downgraded to C from B2
-- Cl. M-9, Downgraded to C from Caa3

Issuer: CWABS Asset-Backed Certificates Trust 2006-SPS2

-- Cl. A, Downgraded to A1 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to A3 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa2 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. M-7, Downgraded to Ba2 from Baa1
-- Cl. M-8, Downgraded to Caa1 from Baa2
-- Cl. M-9, Downgraded to C from Baa3
-- Cl. B, Downgraded to C from Ba1

Issuer: Fieldstone Mortgage Investment Trust 2006-S1

-- Cl. A, Placed on Review for Possible Downgrade, currently Aaa
-- Cl. M1, Placed on Review for Possible Downgrade, currently Aa1
-- Cl. M2, Placed on Review for Possible Downgrade, currently Aa2
-- Cl. M3, Placed on Review for Possible Downgrade, currently Aa3
-- Cl. M4, Placed on Review for Possible Downgrade, currently A1
-- Cl. M5, Downgraded to Ba3 from A2
-- Cl. M6, Downgraded to B1 from A3
-- Cl. B1, Downgraded to B3 from Baa1
-- Cl. B2, Downgraded to Ca from Baa2
-- Cl. B3, Downgraded to C from Baa3

Issuer: First Franklin Mortgage Loan Trust 2006-FFA

-- Cl. M3, Downgraded to A2 from Aa3
-- Cl. M4, Downgraded to Baa1 from A1
-- Cl. M5, Downgraded to Baa2 from A2
-- Cl. M6, Downgraded to Baa3 from A3
-- Cl. M7, Downgraded to Ba1 from Baa1
-- Cl. M8, Downgraded to Ba2 from Baa2
-- Cl. M9, Downgraded to Ba3 from Baa3
-- Cl. B1, Downgraded to B1 from Ba1

Issuer: First Franklin Mortgage Loan Trust 2006-FFB

-- Cl. A1, Downgraded to Aa2 from Aaa
-- Cl. A2, Downgraded to Aa2 from Aaa
-- Cl. A3, Downgraded to Aa2 from Aaa
-- Cl. A4, Downgraded to Aa2 from Aaa
-- Cl. M1, Downgraded to Aa3 from Aa1
-- Cl. M2, Downgraded to A3 from Aa2
-- Cl. M3, Downgraded to Baa2 from Aa3
-- Cl. M4, Downgraded to Ba1 from A1
-- Cl. M5, Downgraded to Ba2 from A2
-- Cl. M6, Downgraded to Ba3 from A3
-- Cl. M7, Downgraded to B2 from Baa1
-- Cl. M8, Downgraded to B3 from Baa2
-- Cl. M9, Downgraded to Ca from Baa3
-- Cl. B1, Downgraded to C from Ba1

Issuer: Fremont Home Loan Trust 2006-B

-- Cl. SL-A, Downgraded to Baa2 from Aa2
-- Cl. SL-M1, Downgraded to Ba1 from A1
-- Cl. SL-M2, Downgraded to B1 from A2
-- Cl. SL-M3, Downgraded to Ca from Baa2
-- Cl. SL-M4, Downgraded to C from Baa3
-- Cl. SL-M5, Downgraded to C from Ba1
-- Cl. SL-M6, Downgraded to C from B3
-- Cl. SL-M7, Downgraded to C from Caa1
-- Cl. SL-M8, Downgraded to C from Ca

Issuer: GSAA Home Equity Trust 2006-S1

-- Cl. I-A-1, Downgraded to Aa3 from Aaa
-- Cl. I-M-1, Downgraded to Baa1 from Aa1
-- Cl. I-M-2, Downgraded to Baa2 from Aa2
-- Cl. I-M-3, Downgraded to Ba2 from A1
-- Cl. I-M-4, Downgraded to Ba3 from A2
-- Cl. I-M-5, Downgraded to B3 from Baa1
-- Cl. I-M-6, Downgraded to Ca from Baa2
-- Cl. I-M-7, Downgraded to C from Baa3
-- Cl. I-B-1, Downgraded to C from Ba1

Issuer: GSAMP Trust 2006-S1

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. A-2A, Downgraded to Aa1 from Aaa
-- Cl. A-2B, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa2
-- Cl. M-2, Downgraded to Ba1 from A2
-- Cl. M-3, Downgraded to B1 from A3
-- Cl. M-4, Downgraded to Ca from Baa1
-- Cl. M-5, Downgraded to C from B3
-- Cl. M-6, Downgraded to C from Ca

Issuer: GSAMP Trust 2006-S2

-- Cl. A-1B, Downgraded to Aa1 from Aaa
-- Cl. A-2, Downgraded to Aa1 from Aaa
-- Cl. A-3, Downgraded to Aa3 from Aaa
-- Cl. M-1, Downgraded to A3 from Aa2
-- Cl. M-2, Downgraded to Baa2 from Aa3
-- Cl. M-3, Downgraded to Ba2 from A2
-- Cl. M-4, Downgraded to B1 from A3
-- Cl. M-5, Downgraded to Ca from Ba1
-- Cl. M-6, Downgraded to C from Ba3
-- Cl. M-7, Downgraded to C from Caa2

Issuer: GSAMP Trust 2006-S3

-- Cl. A-1, Downgraded to Baa1 from Aaa
-- Cl. A-2, Downgraded to Baa1 from Aaa
-- Cl. A-3, Downgraded to Baa1 from Aaa
-- Cl. M-1, Downgraded to B2 from A2
-- Cl. M-2, Downgraded to Ca from Baa3
-- Cl. M-3, Downgraded to C from B3

Issuer: GSAMP Trust 2006-S4

-- Cl. A-2, Downgraded to Aa1 from Aaa
-- Cl. A-3, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa2
-- Cl. M-2, Downgraded to A2 from Aa3
-- Cl. M-3, Downgraded to Baa2 from A2
-- Cl. M-4, Downgraded to Ba1 from A3
-- Cl. M-5, Downgraded to Ba3 from Baa1
-- Cl. M-6, Downgraded to B1 from Baa2
-- Cl. M-7, Downgraded to B3 from Baa3
-- Cl. B-1, Downgraded to C from Ba1
-- Cl. B-2, Downgraded to C from Ba2

Issuer: GSAMP Trust 2006-S5

-- Cl. A-1, Downgraded to Baa1 from Aaa
-- Cl. A-2, Downgraded to Baa1 from Aa1
-- Cl. M-1, Downgraded to Ba3 from A2
-- Cl. M-2, Downgraded to Caa1 from A3
-- Cl. M-3, Downgraded to C from Ba1
-- Cl. M-4, Downgraded to C from B2

Issuer: GSAMP Trust 2006-S6

-- Cl. A-2, Downgraded to Aa2 from Aaa
-- Cl. A-3, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A3 from Aa2
-- Cl. M-2, Downgraded to Baa1 from Aa3
-- Cl. M-3, Downgraded to Baa3 from A2
-- Cl. M-4, Downgraded to Ba3 from A3
-- Cl. M-5, Downgraded to Ca from Baa1
-- Cl. M-6, Downgraded to C from Baa2
-- Cl. M-7, Downgraded to C from Baa3

Issuer: Home Equity Mortgage Trust 2006-2

-- Cl. 1A-1, Downgraded to Aa1 from Aaa
-- Cl. 1A-2, Downgraded to Aa1 from Aaa
-- Cl. 1A-3, Downgraded to Aa1 from Aaa
-- Cl. 1M-1, Downgraded to Aa2 from Aa1
-- Cl. 1M-2, Downgraded to A2 from Aa2
-- Cl. 1M-3, Downgraded to Baa1 from Aa3
-- Cl. 1M-4, Downgraded to Baa3 from A1
-- Cl. 1M-5, Downgraded to Ba1 from A2
-- Cl. 1M-6, Downgraded to B1 from A3
-- Cl. 1M-7, Downgraded to Ca from Baa1
-- Cl. 1M-8, Downgraded to C from Baa2
-- Cl. 1M-9, Downgraded to C from Baa3
-- Cl. 1B-1, Downgraded to C from B3
-- Cl. 1B-2, Downgraded to C from Caa3

Issuer: Home Equity Mortgage Trust 2006-5

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. A-2, Downgraded to Aa2 from Aaa
-- Cl. A-3, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Baa2 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to Ba2 from A3
-- Cl. M-7, Downgraded to Caa1 from Baa1
-- Cl. M-8, Downgraded to Ca from Baa2
-- Cl. M-9, Downgraded to C from Baa3
-- Cl. B-1, Downgraded to C from Ba1

Issuer: Home Equity Mortgage Trust 2006-6

-- Cl. 1A-1, Downgraded to Aa1 from Aaa
-- Cl. 2A-1, Downgraded to Aa1 from Aaa
-- Cl. 2A-2, Downgraded to Aa1 from Aaa
-- Cl. 2A-3, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to A3 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa2 from A2
-- Cl. M-6, Downgraded to Baa3 from A3
-- Cl. M-7, Downgraded to Ba1 from Baa1
-- Cl. M-8, Downgraded to B3 from Baa2
-- Cl. M-9, Downgraded to C from Baa3

Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust, INDS
2006-1

-- Cl. B-1, Downgraded to Caa2 from Baa3
-- Cl. B-2, Downgraded to Ca from Ba1
-- Cl. B-3, Downgraded to C from Ba2

Issuer: IndyMac Home Equity Mortgage Loan Asset-Backed Trust, INDS
2006-A

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa2 from Aa1
-- Cl. M-2, Downgraded to A1 from Aa2
-- Cl. M-3, Downgraded to A2 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa3 from A2
-- Cl. M-6, Downgraded to Ba1 from A3
-- Cl. M-7, Downgraded to Ba2 from A3
-- Cl. M-8, Downgraded to B3 from Baa1
-- Cl. M-9, Downgraded to Ca from Baa3
-- Cl. M-10, Downgraded to C from Baa3
-- Cl. B-2, Downgraded to C from Caa1
-- Cl. B-3, Downgraded to C from Caa2

Issuer: Long Beach Mortgage Loan Trust 2006-A

-- Cl. A-1, Downgraded to A3 from Aa2
-- Cl. A-2, Downgraded to A3 from Aa2
-- Cl. A-3, Downgraded to A3 from Aa2
-- Cl. M-1, Downgraded to Ba2 from A2
-- Cl. M-2, Downgraded to B3 from A3
-- Cl. M-3, Downgraded to Ca from Ba1
-- Cl. M-4, Downgraded to C from B2
-- Cl. M-5, Downgraded to C from Caa3

Issuer: MASTR Second Lien Trust 2006-1

-- Cl. A, Downgraded to Aa3 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa2
-- Cl. M-2, Downgraded to Ba1 from A2
-- Cl. M-3, Downgraded to B2 from A3
-- Cl. M-4, Downgraded to C from Ba3
-- Cl. M-5, Downgraded to C from B3
-- Cl. M-6, Downgraded to C from Caa3
-- Cl. M-8, Downgraded to C from Caa2

Issuer: Merrill Lynch Mortgage Investors Trust 2006-SL1

-- Cl. B-1, Downgraded to Baa3 from Baa1
-- Cl. B-2, Downgraded to Ba1 from Baa2
-- Cl. B-3, Downgraded to Ba3 from Baa3
-- Cl. B-4, Downgraded to B3 from Ba1
-- Cl. B-5, Downgraded to C from Ba2

Issuer: Merrill Lynch Mortgage Investors Trust 2006-SL2

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa2 from Aa1
-- Cl. M-2, Downgraded to Aa3 from Aa2
-- Cl. M-3, Downgraded to A2 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa2 from A2
-- Cl. M-6, Downgraded to Baa3 from A3
-- Cl. M-7, Downgraded to Ba1 from Baa1
-- Cl. M-8, Downgraded to B1 from Baa2
-- Cl. M-9, Downgraded to Caa2 from Baa3
-- Cl. B-1, Downgraded to C from Ba1
-- Cl. B-2, Downgraded to C from Ba2

Issuer: Morgan Stanley Mortgage Loan Trust 2006-10SL

-- Cl. A-1, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa2
-- Cl. M-2, Downgraded to Baa1 from A2
-- Cl. M-3, Downgraded to Baa2 from A3
-- Cl. B-1, Downgraded to Baa3 from Baa1
-- Cl. B-2, Downgraded to Ba2 from Baa2
-- Cl. B-3, Downgraded to Ba3 from Baa3
-- Cl. B-4, Downgraded to B3 from Ba1
-- Cl. B-5, Downgraded to C from Ba2

Issuer: Morgan Stanley Mortgage Loan Trust 2006-14SL

-- Cl. A-1, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa2
-- Cl. M-2, Downgraded to A1 from Aa3
-- Cl. M-3, Downgraded to Baa1 from A2
-- Cl. M-4, Downgraded to Baa2 from A3
-- Cl. B-1, Downgraded to Baa3 from Baa1
-- Cl. B-2, Downgraded to Ba1 from Baa2
-- Cl. B-3, Downgraded to Ba3 from Baa3
-- Cl. B-4, Downgraded to B1 from Ba1
-- Cl. B-5, Downgraded to C from Ba2

Issuer: Morgan Stanley Mortgage Loan Trust 2006-4SL

-- Cl. M-2, Downgraded to Baa1 from A2
-- Cl. M-3, Downgraded to Baa2 from A3
-- Cl. B-1, Downgraded to Baa3 from Baa1
-- Cl. B-2, Downgraded to Ba1 from Baa2
-- Cl. B-3, Downgraded to B1 from Baa3
-- Cl. B-4, Downgraded to Ca from Ba1
-- Cl. B-5, Downgraded to C from Ba2

Issuer: New Century Home Equity Loan Trust, Series 2006-S1

-- Cl. A-1, Downgraded to Baa2 from Aa1
-- Cl. A-2a, Downgraded to A3 from Aaa
-- Cl. A-2b, Downgraded to Baa2 from Aa1
-- Cl. M-1, Downgraded to Ba3 from A3
-- Cl. M-2, Downgraded to B3 from Baa2
-- Cl. M-3, Downgraded to Ca from Ba3
-- Cl. M-4, Downgraded to C from B3
-- Cl. M-5, Downgraded to C from Caa3
-- Cl. M-6, Downgraded to C from Ca

Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-S1

-- Cl. M-3, Downgraded to A1 from Aa2
-- Cl. M-4, Downgraded to A2 from Aa3
-- Cl. M-5, Downgraded to Baa2 from A1
-- Cl. M-6, Downgraded to Baa3 from A2
-- Cl. B-1, Downgraded to Ba1 from A3
-- Cl. B-2, Downgraded to B1 from Baa2
-- Cl. B-3, Downgraded to Caa3 from Baa3
-- Cl. B-4, Downgraded to C from Ba1
-- Cl. B-5, Downgraded to C from Caa1

Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-S2

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. A-2, Downgraded to Aa2 from Aaa
-- Cl. A-3, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Baa2 from Aa3
-- Cl. M-4, Downgraded to Ba1 from A1
-- Cl. M-5, Downgraded to Ba2 from A2
-- Cl. M-6, Downgraded to B3 from A3
-- Cl. B-1, Downgraded to Ca from Baa1
-- Cl. B-2, Downgraded to C from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from B3
-- Cl. B-5, Downgraded to C from Caa1

Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-S3

-- Cl. A-1, Downgraded to Aa3 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Baa2 from Aa3
-- Cl. M-4, Downgraded to Ba1 from A1
-- Cl. M-5, Downgraded to Ba2 from A2
-- Cl. M-6, Downgraded to B1 from A3
-- Cl. B-1, Downgraded to B3 from Baa1
-- Cl. B-2, Downgraded to Ca from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from Ba1
-- Cl. B-5, Downgraded to C from Caa1

Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-S4

-- Cl. A-1, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A1 from Aa1
-- Cl. M-2, Downgraded to A3 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to Ba3 from A3
-- Cl. B-1, Downgraded to B3 from Baa1
-- Cl. B-2, Downgraded to Ca from Baa2
-- Cl. B-3, Downgraded to C from Baa3

Issuer: Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-S5

-- Cl. A, Downgraded to A1 from Aaa
-- Cl. M-1, Downgraded to A3 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa1
-- Cl. M-3, Downgraded to Baa3 from Aa2
-- Cl. M-4, Downgraded to Ba1 from Aa3
-- Cl. M-5, Downgraded to B2 from A1
-- Cl. M-6, Downgraded to Ca from A3
-- Cl. M-7, Downgraded to C from Baa1
-- Cl. M-8, Downgraded to C from Baa2
-- Cl. M-9, Downgraded to C from Baa3
-- Cl. M-10, Downgraded to C from Caa1

Issuer: Ownit Mortgage Trust 2006-OT1

-- Cl. M-1, Downgraded to A2 from Aa2
-- Cl. M-2, Downgraded to Baa1 from A2
-- Cl. M-3, Downgraded to Baa2 from A3
-- Cl. B-1, Downgraded to Baa3 from Baa1
-- Cl. B-2, Downgraded to Ba1 from Baa2
-- Cl. B-3, Downgraded to Ba2 from Baa3
-- Cl. B-4, Downgraded to B1 from Ba1
-- Cl. B-5, Downgraded to Ca from Ba2

Issuer: SACO I Trust 2006-10

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to A3 from Aa3
-- Cl. M-4, Downgraded to Baa1 from Aa3
-- Cl. M-5, Downgraded to Baa2 from A1
-- Cl. M-6, Downgraded to Baa3 from A2
-- Cl. B-1, Downgraded to Ba2 from A3
-- Cl. B-2, Downgraded to B2 from Baa2
-- Cl. B-3, Downgraded to Ca from Baa3
-- Cl. B-4, Downgraded to C from Ba1

Issuer: SACO I Trust 2006-3

-- Cl. A-1, Downgraded to Aa1 from Aaa
-- Cl. A-3, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa2 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to Ba3 from A3
-- Cl. B-1, Downgraded to B3 from Baa1
-- Cl. B-2, Downgraded to Ca from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from B3

Issuer: SACO I Trust 2006-4

-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to B1 from A3
-- Cl. B-1, Downgraded to B3 from Baa1
-- Cl. B-2, Downgraded to Ca from Baa2
-- Cl. B-3, Downgraded to C from Baa3
-- Cl. B-4, Downgraded to C from B3

Issuer: SACO I Trust 2006-5

-- Cl. I-A, Downgraded to A1 from Aaa
-- Cl. I-M-1, Downgraded to A2 from Aa1
-- Cl. I-M-2, Downgraded to A3 from Aa2
-- Cl. I-M-3, Downgraded to Baa1 from Aa3
-- Cl. I-M-4, Downgraded to Baa2 from A1
-- Cl. I-M-5, Downgraded to Baa3 from A2
-- Cl. I-M-6, Downgraded to Ba1 from A3
-- Cl. I-B-1, Downgraded to B1 from Baa1
-- Cl. I-B-2, Downgraded to Caa1 from Baa2
-- Cl. I-B-3, Downgraded to Ca from Baa3
-- Cl. I-B-4, Downgraded to C from B2
-- Cl. II-A-1, Downgraded to A1 from Aaa
-- Cl. II-A-2, Downgraded to Aa2 from Aaa
-- Cl. II-A-3, Downgraded to A1 from Aaa
-- Cl. II-M-1, Downgraded to A1 from Aa1
-- Cl. II-M-2, Downgraded to Baa2 from Aa2
-- Cl. II-M-3, Downgraded to Baa3 from Aa3
-- Cl. II-M-4, Downgraded to Ba2 from A1
-- Cl. II-M-5, Downgraded to B3 from A2
-- Cl. II-M-6, Downgraded to Ca from A3
-- Cl. II-B-1, Downgraded to C from Ba3
-- Cl. II-B-2, Downgraded to C from B3
-- Cl. II-B-3, Downgraded to C from Caa1
-- Cl. II-B-4, Downgraded to C from Ca

Issuer: SACO I Trust 2006-6

-- Cl. A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa2 from Aa2
-- Cl. M-3, Downgraded to Ba1 from Aa3
-- Cl. M-4, Downgraded to Ba2 from A1
-- Cl. M-5, Downgraded to B2 from A2
-- Cl. M-6, Downgraded to Ca from A3
-- Cl. B-1, Downgraded to C from Ba3
-- Cl. B-2, Downgraded to C from B3
-- Cl. B-3, Downgraded to C from Caa1
-- Cl. B-4, Downgraded to C from Ca

Issuer: SACO I Trust 2006-7

-- Cl. A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa1 from Aa2
-- Cl. M-3, Downgraded to Baa3 from Aa3
-- Cl. M-4, Downgraded to Ba2 from A1
-- Cl. M-5, Downgraded to B2 from A2
-- Cl. M-6, Downgraded to Ca from A3
-- Cl. B-1, Downgraded to C from Baa1
-- Cl. B-2, Downgraded to C from B3
-- Cl. B-3, Downgraded to C from Caa1
-- Cl. B-4, Downgraded to C from Ca

Issuer: SACO I Trust 2006-9

-- Cl. A, Downgraded to Aa2 from Aaa
-- Cl. M-1, Downgraded to Aa3 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to A3 from Aa3
-- Cl. M-4, Downgraded to Baa1 from A1
-- Cl. M-5, Downgraded to Baa2 from A2
-- Cl. M-6, Downgraded to Baa3 from A3
-- Cl. B-1, Downgraded to Ba1 from Baa1
-- Cl. B-2, Downgraded to Ba2 from Baa2
-- Cl. B-3, Downgraded to B1 from Baa3
-- Cl. B-4, Downgraded to Ca from Ba1

Issuer: Saco I Trust 2006-2

-- Cl. I-M, Downgraded to Ba3 from A3
-- Cl. I-B-1, Downgraded to B1 from Baa1
-- Cl. I-B-2, Downgraded to Ca from Baa2
-- Cl. I-B-3, Downgraded to C from Baa3
-- Cl. I-B-4, Downgraded to C from B2
-- Cl. II-M, Downgraded to B3 from A3
-- Cl. II-B-1, Downgraded to Ca from Baa1
-- Cl. II-B-2, Downgraded to C from Baa2
-- Cl. II-B-3, Downgraded to C from Baa3
-- Cl. II-B-4, Downgraded to C from B3

Issuer: Soundview Home Loan Trust 2006-A

-- Cl. A, Downgraded to Aa1 from Aaa
-- Cl. M-1, Downgraded to Aa2 from Aa1
-- Cl. M-2, Downgraded to A2 from Aa2
-- Cl. M-3, Downgraded to Baa1 from Aa3
-- Cl. M-4, Downgraded to Baa3 from A1
-- Cl. M-5, Downgraded to Ba1 from A2
-- Cl. M-6, Downgraded to Ba3 from A3
-- Cl. M-7, Downgraded to B3 from Baa1
-- Cl. M-8, Downgraded to Caa1 from Baa2
-- Cl. M-9, Downgraded to Ca from Baa3
-- Cl. M-10, Downgraded to C from B3
-- Cl. M-11, Downgraded to C from Caa2

Issuer: Structured Asset Securities Corp Trust 2006-ARS1

-- Cl. A1, Downgraded to A1 from Aaa
-- Cl. M1, Downgraded to A2 from Aa1
-- Cl. M2, Downgraded to Baa2 from Aa2
-- Cl. M3, Downgraded to Baa3 from Aa3
-- Cl. M4, Downgraded to Ba2 from A1
-- Cl. M5, Downgraded to B2 from A2
-- Cl. M6, Downgraded to Ca from A3
-- Cl. M7, Downgraded to C from Baa1
-- Cl. M8, Downgraded to C from Baa2
-- Cl. M9, Downgraded to C from B3
-- Cl. B1, Downgraded to C from Caa1
-- Cl. B2, Downgraded to C from Caa3

Issuer: Structured Asset Securities Corp Trust 2006-S1

-- Cl. A1, Downgraded to Aa1 from Aaa
-- Cl. A2, Downgraded to Aa1 from Aaa
-- Cl. M1, Downgraded to Aa3 from Aa2
-- Cl. M2, Downgraded to A2 from Aa3
-- Cl. M3, Downgraded to Baa1 from A1
-- Cl. M4, Downgraded to Baa3 from A2
-- Cl. M5, Downgraded to Ba3 from A3
-- Cl. M6, Downgraded to B1 from Baa1
-- Cl. M7, Downgraded to B3 from Baa2
-- Cl. M8, Downgraded to Ca from Baa3
-- Cl. B1, Downgraded to C from B2
-- Cl. B2, Downgraded to C from B3

Issuer: Structured Asset Securities Corp Trust 2006-S2

-- Cl. M1, Downgraded to Aa3 from Aa1
-- Cl. M2, Downgraded to A3 from Aa2
-- Cl. M3, Downgraded to Baa1 from Aa3
-- Cl. M4, Downgraded to Baa3 from A1
-- Cl. M5, Downgraded to Ba2 from A2
-- Cl. M6, Downgraded to B1 from A3
-- Cl. M7, Downgraded to B2 from Baa1
-- Cl. M8, Downgraded to B3 from Baa2
-- Cl. M9, Downgraded to Ca from Baa3
-- Cl. B1, Downgraded to C from Ba1
-- Cl. B2, Downgraded to C from Ba2

Issuer: Structured Asset Securities Corp Trust 2006-S3

-- Cl. M-1, Downgraded to A2 from Aa1
-- Cl. M-2, Downgraded to Baa2 from Aa2
-- Cl. M-3, Downgraded to Baa3 from Aa3
-- Cl. M-4, Downgraded to Ba2 from A1
-- Cl. M-5, Downgraded to B1 from A2
-- Cl. M-6, Downgraded to Ca from A3
-- Cl. M-7, Downgraded to C from Baa1
-- Cl. M-8, Downgraded to C from B3
-- Cl. M-9, Downgraded to C from Caa1
-- Cl. B-1, Downgraded to C from Caa2

Issuer: Structured Asset Securities Corporation 2006-S4

-- Cl. M2, Placed on Review for Possible Downgrade, currently Aa2
-- Cl. M3, Placed on Review for Possible Downgrade, currently Aa2
-- Cl. M4, Placed on Review for Possible Downgrade, currently A1
-- Cl. M5, Placed on Review for Possible Downgrade, currently A2
-- Cl. M6, Placed on Review for Possible Downgrade, currently A3
-- Cl. M7, Placed on Review for Possible Downgrade, currently
Baa1
-- Cl. M8, Placed on Review for Possible Downgrade, currently
Baa2
-- Cl. M9, Placed on Review for Possible Downgrade, currently
Baa3
-- Cl. B2, Placed on Review for Possible Downgrade, currently Ba2

Issuer: Terwin Mortgage Trust 2006-1

-- Cl. II-A-1a, Downgraded to Aa3 from Aaa
-- Cl. II-A-1b, Downgraded to Aa3 from Aaa
-- Cl. II-M-A, Downgraded to A1 from Aa1
-- Cl. II-M-1, Downgraded to A2 from Aa2
-- Cl. II-M-2, Downgraded to Baa1 from Aa3
-- Cl. II-M-3, Downgraded to Ba2 from A2
-- Cl. II-B-1, Downgraded to B1 from Baa2
-- Cl. II-B-2, Downgraded to Caa1 from Ba1
-- Cl. II-B-3, Downgraded to Ca from Ba3
-- Cl. II-B-4, Downgraded to C from Caa2

Issuer: Terwin Mortgage Trust 2006-10SL

-- Cl. M-1, Downgraded to Baa1 from Aa2
-- Cl. M-2, Downgraded to Baa2 from Aa3
-- Cl. M-3, Downgraded to Ba1 from A2
-- Cl. B-1, Downgraded to Ba2 from A3
-- Cl. B-2, Downgraded to Caa1 from Baa1
-- Cl. B-3, Downgraded to Ca from Baa2
-- Cl. B-4, Downgraded to C from B3
-- Cl. B-5, Downgraded to C from Caa1
-- Cl. B-6, Downgraded to C from Caa2

Issuer: Terwin Mortgage Trust 2006-12SL

-- Cl. M-1, Downgraded to Baa1 from Aa2
-- Cl. M-2, Downgraded to Baa2 from Aa3
-- Cl. M-3, Downgraded to Ba1 from A2
-- Cl. B-1, Downgraded to Ba3 from A3
-- Cl. B-2, Downgraded to Ca from Ba3
-- Cl. B-3, Downgraded to C from B1
-- Cl. B-4, Downgraded to C from B3
-- Cl. B-5, Downgraded to C from Caa1

Issuer: Terwin Mortgage Trust 2006-2HGS

-- Cl. M-1, Downgraded to A3 from Aa2
-- Cl. M-2, Downgraded to Baa1 from Aa3
-- Cl. M-3, Downgraded to Ba1 from A2
-- Cl. B-1, Downgraded to Ba2 from Baa1
-- Cl. B-2, Downgraded to B3 from Baa3
-- Cl. B-3, Downgraded to C from Ba2
-- Cl. B-4, Downgraded to C from B1
-- Cl. B-5, Downgraded to C from Caa1

Issuer: Terwin Mortgage Trust 2006-4SL

-- Cl. M-1, Downgraded to A2 from Aa2
-- Cl. M-2, Downgraded to Baa1 from Aa3
-- Cl. M-3, Downgraded to Ba1 from A2
-- Cl. B-1, Downgraded to Ba2 from A3
-- Cl. B-2, Downgraded to B2 from Baa3
-- Cl. B-3, Downgraded to Ca from Ba1
-- Cl. B-4, Downgraded to C from Ba3
-- Cl. B-5, Downgraded to C from B3
-- Cl. B-6, Downgraded to C from Caa2

Issuer: Terwin Mortgage Trust 2006-6

-- Cl. I-M-1, Downgraded to A3 from Aa2
-- Cl. I-M-2, Downgraded to Baa1 from Aa3
-- Cl. I-M-3, Downgraded to Ba1 from A2
-- Cl. I-B-1, Downgraded to Ba3 from A2
-- Cl. I-B-2, Downgraded to B1 from Baa1
-- Cl. I-B-3, Downgraded to B3 from Ba1
-- Cl. I-B-4, Downgraded to Ca from Ba3
-- Cl. I-B-5, Downgraded to C from B1
-- Cl. I-B-6, Downgraded to C from Caa2

Issuer: Terwin Mortgage Trust 2006-8

-- Cl. I-M-1, Downgraded to A3 from Aa2
-- Cl. I-M-2, Downgraded to Baa1 from Aa3
-- Cl. I-M-3, Downgraded to Baa3 from A2
-- Cl. I-B-1, Downgraded to Ba1 from A3
-- Cl. I-B-2, Downgraded to Ba3 from Baa1
-- Cl. I-B-3, Downgraded to Caa2 from Baa2
-- Cl. I-B-5, Downgraded to C from B3
-- Cl. I-B-4, Downgraded to C from Baa3
-- Cl. I-B-6, Downgraded to C from Caa1


* BOND PRICING: For the Week of August 13 - August 18, 2007
-----------------------------------------------------------

Issuer                              Coupon   Maturity  Price
------                              ------   --------  -----
ABC Rail Product                     10.500%  01/15/04      0
ABC Rail Product                     10.500%  12/31/04      0
Acme Metals Inc                      12.500%  08/01/02      0
AHI-DFLT07/05                         8.625%  10/01/07     71
Aladdin Gaming                       13.500%  03/01/10      0
Albertson's Inc                       6.520%  04/10/28     69
Amer & Forgn Pwr                      5.000%  03/01/30     61
Ames Dept Stores                     10.000%  1/15/06       0
Antigenics                            5.250%  2/01/25      71
Atherogenics Inc                      1.500%  02/01/12     38
Atlantic Coast                        6.000%  02/15/34      4
Bank New England                      8.750%  04/01/99      8
Bank New England                      9.500%  02/15/96     14
Bank New England                      9.875%  09/15/99      8
Beazer Homes USA                      6.500%  11/15/13     75
Budget Group Inc                      9.125%  04/01/06      0
Builders Transport                    6.500%  05/01/11      0
Burlington North                      3.200%  01/01/45     53
Calpine Gener Co                     11.500%  04/01/11     34
Cell Therapeutic                      5.750%  06/15/08     72
Clear Channel                         4.900%  05/15/15     74
Clear Channel                         5.500%  12/15/16     74
Collins & Aikman                     10.750%  12/31/11      1
Color Tile Inc                       10.750%  12/15/01      0
Complete Mgmt                         5.000%  08/15/03      0
Comprehensive Care                    7.500%  04/15/10     60
Curagen Corp                          4.000%  02/15/11     65
Decode Genetics                       3.500%  04/15/11     68
Delta Air Lines                       8.000%  12/01/15     75
Delta Mills Inc                       9.625%  09/01/07     16
Desa Intl Inc                         9.875%  12/15/07      0
Duquesne Light                        6.250%  08/15/35     75
Dura Operating                        8.625%  04/15/12     53
Dura Operating                        9.000%  05/01/09      7
Dura Operating                        9.000%  05/01/09      5
Dvi Inc                               9.875%  02/01/04     10
Dyersburg Corp                        9.750%  09/01/07      0
Encysive Pharma                       2.500%  03/15/12     73
Exodus Comm Inc                       5.250%  02/15/08      0
Exodus Comm Inc                      11.625%  07/15/10      0
Fedders North Am                      9.875%  03/01/14     28
Finlay Fine Jewelry                   8.375%  06/01/12     74
Finova Group                          7.500%  11/15/09     18
Florsheim Group                      12.750   09/01/02      0
Ford Motor Co                         6.375%  02/01/29     71
Ford Motor Co                         6.625%  02/15/28     72
Ford Motor Co                         6.625%  10/01/28     72
Ford Motor Co                         7.125%  11/15/25     72
Ford Motor Co                         7.400%  11/01/46     73
Ford Motor Co                         7.700%  05/15/97     73
Ford Motor Co                         7.750%  06/15/43     74
General Motors                        6.750%  05/01/28     75
GMAC                                  6.000%  03/15/19     74
GMAC                                  6.050%  10/15/19     74
GMAC                                  6.125%  10/15/19     74
GMAC                                  6.150%  08/15/19     74
Gulf States STL                      13.500%  04/15/03      0
Harrahs Oper Co.                      5.750%  10/01/17     74
Hines Nurseries                      10.250%  10/01/11     75
Iridium LLC/CAP                      10.875%  07/15/05     17
Iridium LLC/CAP                      11.250%  07/15/05     17
Iridium LLC/CAP                      13.000%  07/15/05     18
Iridium LLC/CAP                      14.000%  07/15/05     18
K Hovnanian Entr                      7.750%  05/15/13     74
Kaiser Aluminum                       9.875%  02/15/02      0
Kaiser Aluminum                      12.750%  02/01/03      6
Kellstrom Inds                        5.500%  06/15/03      0
Kmart Corp                            9.350%  01/02/20     12
K Mart Funding                        8.800%  0/01/10      73   
Lehman Bros Holding                   4.800%  06/24/23     73
Lehman Bros Holding                  10.000%  10/30/13     71
Liberty Media                         3.750%  02/15/30     58
Liberty Media                         4.000%  11/15/29     64
Lifecare Holding                      9.250%  08/15/13     56
LTV Corp                              8.200%  09/15/07      0
McSaver Financl                       7.400%  02/15/02      0
McSaver Financl                       7.875%  08/01/03      0
Medquest Inc                         11.875%  08/15/12     75
Missuori Pac RR                       4.750%  01/01/30     73
Missuori Pac RR                       5.000%  01/01/45     74
Motorola Inc                          5.220%  10/01/97     71
Movie Gallery                        11.000%  05/01/12     27
Natl Steel Corp                       9.875%  03/01/09      0
New Orl Grt N RR                      5.000%  07/01/32     61
Northern Pacific RY                   3.000%  01/01/47     51
Northern Pacific RY                   3.000%  01/01/47     51
Northwest Steel & Wire                9.500%  06/15/01      0
NTK Holdings Inc                     10.750%  03/01/14     62
Nutritional Src                      1.125%   08/01/09     66
O'Sullivan Ind                       10.630%  10/01/08      0
Oakwood Homes                         7.875%  03/01/04     11
Oscient Pharma                        3.500%  04/15/11     70
Outboard Marine                       9.125%  04/15/17      0
Pac-West Telecom                     13.500%  02/01/09      3
Pac-West Telecom                     13.500%  02/01/09     10
PCA LLC/PCA FIN                      11.875   08/01/09      5
Pegasus Satellite                    12.375%  08/01/08      0
Phelps Dodge                          6.125%  03/15/34     72
Piedmont Aviat                       10.250%  01/15/49      0
Pixelworks Inc                        1.750%  05/15/24     74
Polaroid Corp                         6.750%  01/15/02      0
Polaroid Corp                         7.250%  01/15/07      0
Polaroid Corp                        11.500%  02/15/06      0
Pope & Talbot                         8.375%  06/01/13     70
Pope & Talbot                         8.375%  06/01/13     63
Primus Telecom                        3.750%  09/15/10     68
Pulte Homes Inc                       6.000%  02/15/35     73
Radnor Holdings                      11.000%  03/15/10      0
Reliance Grp Hld                      9.000%  11/15/00      0
Rite Aid Corp.                        7.700%  02/15/27     75
RJ Tower Corp.                       12.000%  06/01/13      4
Saint Acquisition                    12.500%  05/15/17     69
SeviceMaster Co                       7.450%  08/15/27     70
Scotia Pac Co                         6.550%  01/20/07     50
SLM Corp                              5.000%  06/15/28     70
SLM Corp                              5.400%  03/15/28     73
SLM Corp                              5.400%  03/15/30     74
SLM Corp                              5.400%  06/15/30     73
SLM Corp                              5.450%  06/15/28     74
SLM Corp                              5.500%  06/15/29     72
SLM Corp                              5.500%  03/15/30     73
SLM Corp                              5.500%  06/15/30     71
SLM Corp                              5.500%  12/15/30     71
SLM Corp                              5.650%  03/15/29     74
SLM Corp                              5.650%  12/15/29     73
SLM Corp                              5.650%  12/15/29     74
SLM Corp                              5.650%  06/15/30     75
SLM Corp                              5.700%  03/15/29     74
SLM Corp                              5.700%  03/15/30     74
SLM Corp                              5.750%  03/15/29     75
SLM Corp                              5.750%  06/15/29     75
SLM Corp                              5.750%  09/15/29     75
SLM Corp                              5.750%  09/15/29     73
SLM Corp                              5.750%  03/15/30     75
SLM Corp                              6.000%  12/15/31     75
SLM Corp                              6.050%  12/15/31     74
Spacehab Inc                          5.500%  10/15/10     51
Spectrum Brands                       7.375%  02/01/15     75
Stanley-Martin                        9.750%  08/15/15     75
TCNCT Healthcare                      6.875%  11/15/31     73
Telcordia Tech                       10.000%  03/15/13     75
Times Mirror Co                       6.610%  09/15/27     67
Times Mirror Co                       7.250%  11/15/96     73
Times Mirror- New                     7.7500% 07/01/23     72
Tom's Foods Inc                      10.500%  11/01/04      1
Tousa Inc                             7.500%  03/15/11     46
Tousa Inc                             7.500%  01/15/15     40
TransTexas Gas                       15.000%  03/15/05      0
Tribune Co                            5.250%  08/15/15     73
United Air Lines                      9.200%  03/22/08     52
United Homes Inc.                    11.000%  03/15/05      0
US Air Inc.                          10.550%  01/15/49      0
US Air Inc.                          10.680%  06/27/08      0
US Air Inc.                          10.700%  01/01/49      0
US Air Inc.                          10.800%  01/01/49      0
USAutos Trust                         2.212%  03/03/11      7
Vicorp Restaurant                    10.500%  04/15/11     72
Wachovia Corp                         9.250%  04/10/08     74
Wachovia Corp                        15.500%  12/05/07     69
WCI Communities                       6.625%  03/15/15     71
WCI Communities                       7.875%  10/01/13     72
Weirton Steel                        10.750%  06/01/05      0
Werner Holdings                      10.000%  11/15/07      3
Westpoint Steven                      7.875%  06/15/05      0
William Lyon                          7.500%  02/15/14     74
Winstar Comm Inc                     12.750%  04/15/10      0
Winstar Comm                         14.000%  10/15/05      0
Wornick Co                           10.875%  07/15/11     75

                              *********

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 ***