/raid1/www/Hosts/bankrupt/TCR_Public/070908.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

           Saturday, September 8, 2007, Vol. 11, No. 213

                             Headlines

ALLIED HOLDINGS: Reports $15.8 Mil. Cash Disbursements in May 2007
CALPINE CORP: Earns $1,000,000 in Month Ended June 30, 2007
CALPINE CORP: Posts $27,000,000 Net Loss in July 2007
DANA CORP: Earns $11,000,000 in Month Ended July 31, 2007
FEDERAL-MOGUL: Post $21.1 Million Net Loss in July 2007

HANCOCK FABRICS: Posts $1,497,000 Net Loss in August 2007
SOLUTIA INC: Earns $8,000,000 in Period Ending July 31, 2007

                             *********

ALLIED HOLDINGS: Reports $15.8 Mil. Cash Disbursements in May 2007
------------------------------------------------------------------
In a correctional notice, Thomas H. King, chief financial officer
of Allied Holdings Inc., informed the U.S. Bankruptcy Court for
the Northern District of Georgia that for the period May 1 to 31,
2007, Allied Holdings made cash disbursements totaling
$15,869,311.

The Debtors disclosed cash disbursements totaling $13,505,381
during May 2007.

As reported in the Troubled Company Reporter on Aug. 4, 2007, the
Debtor filed with the Court its operating report for the month
ended May 31, 2007 disclosing:


                     Allied Holdings, Inc.
             Unaudited Consolidated Balance Sheet
                       As of May 31, 2007
                        (In Thousands)

                            Assets

Current Assets:
       Cash and cash equivalents                        $34,128
       Receivables, net of allowances                    44,574
       Related party receivables                         27,617
       Inventories                                        5,038
       Deferred income taxes                              1,907
       Prepayments and other current assets              14,869
                                                      ---------
          Total current assets                          128,133

Property and equipment, net                             149,621
Goodwill, net                                             3,545
Other noncurrent assets                                  31,424
Investment in related parties                            21,526
                                                      ---------
TOTAL ASSETS                                           $334,249

Liabilities and Stockholders' Deficit

Current liabilities not subject to compromise:
        DIP credit facility                              $1,800
        Accounts and notes payable                       41,610
        Accrued liabilities                              58,448
                                                      ---------
          Total current liabilities                     100,858

Long-term liabilities not subject to compromise
        DIP credit facility                             227,700
        Postretirement benefits                          14,244
        Deferred income taxes                             1,926
        Other long-term liabilities                      15,957
                                                      ---------
          Total long-term liabilities                   259,827

Liabilities subject to compromise                       198,210
Stockholders' deficit                                  (225,646)
                                                      ---------
       Total liabilities & stockholders' deficit       $334,249

                     Allied Holdings, Inc.
        Unaudited Consolidated Statement of Operations
              For the Month Ended May 31, 2007
                        (In Thousands)

Revenues                                                $77,390

Operating Expenses
       Salaries, Wages & Fringe benefits                 38,368
       Operating supplies & expenses                     16,262
       Purchased transportation                           8,954
       Insurance & claims                                 3,994
       Operating tax & licenses                           2,362
       Depreciation & amortization                        3,042
       Rents                                                693
       Communications & utilities                           460
       Other operating expenses                             756
       Loss on disposal of operating assets, net             35
                                                      ---------
          Total Operating Expenses                       74,926
                                                      ---------
          Operating Income (Loss)                         2,464

Other Income (Expense)
       Interest expense                                  (3,844)
       Investment income                                    113
       Foreign exchange gains, net                        1,765
       Equity in earnings of subsidiaries                   736
                                                      ---------
                                                         (1,230)
                                                      ---------
Income before reorganization items and income taxes       1,234
Reorganization items                                     (9,418)
                                                      ---------
Loss before income taxes                                 (8,184)
Income tax benefit                                            -
                                                      ---------
NET LOSS                                                ($8,184)

Based in Decatur, Georgia, Allied Holdings Inc. (AMEX: AHI, other
OTC: AHIZQ.PK) -- http://www.alliedholdings.com/-- and its    
affiliates provide short-haul services for original equipment
manufacturers and provide logistical services.  The company and 22
of its affiliates filed for chapter 11 protection on July 31, 2005
(Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537).  Jeffrey W.
Kelley, Esq., at Troutman Sanders, LLP, represented the Debtors in
their restructuring efforts.  Henry S. Miller at Miller Buckfire &
Co., LLC, served as the Debtors' financial advisor.  Anthony J.
Smits, Esq., at Bingham McCutchen LLP, provided the Official
Committee of Unsecured Creditors with legal advice and Russell A.
Belinsky at Chanin Capital Partners, LLC, provided financial
advisory services to the Committee.  When the Debtors filed for
protection from their creditors, they estimated more than
$100 million in assets and debts.  

On May 11, 2007, the Court confirmed Allied's Second Amended
Chapter 11 Plan of Reorganization.  Allied emerged from
bankruptcy on May 29, 2007.  (Allied Holdings Bankruptcy
News, Issue No. 55; Bankruptcy Creditors' Service, Inc.
http://bankrupt.com/newsstand/or 215/945-7000)    

                         *     *     *

As of April 30, 2007, Allied Holdings Inc.'s consolidated balance
sheet showed $217,379,000 in total stockholders' deficit resulting
from total assets of $309,931,000 and total liabilities of         
$527,310,000.


CALPINE CORP: Earns $1,000,000 in Month Ended June 30, 2007
-----------------------------------------------------------

                      Calpine Corporation
              Consolidated Condensed Balance Sheet
                       As of June 30, 2007

                             ASSETS

Current assets:
   Cash and cash equivalents                     $1,404,000,000
   Accounts receivable, net                         964,000,000
   Inventories                                      144,000,000
    Margin deposits and other prepaid expense       432,000,000
    Restricted cash, current                        410,000,000
    Current derivative assets                       245,000,000
    Assets held for sale                            378,000,000
    Other current assets                             56,000,000
                                                ---------------
Total current assets                              4,033,000,000

Property, plant and equipment, net               12,759,000,000
Restricted cash, net of current portion             148,000,000
Investments                                         262,000,000
Long-term derivative assets                         358,000,000
Non-current assets held for sale                              0
Other assets                                      1,006,000,000
                                                ---------------
Total assets                                    $18,566,000,000
                                                ===============

              LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
   Accounts payable                                $697,000,000
   Accrued interest payable                         268,000,000
   Debt, current                                  4,877,000,000
   Current derivative liabilities                   291,000,000
   Income taxes payable                              36,000,000
   Liabilities held for sale                        312,000,000
   Other current liabilities                        354,000,000
                                                ---------------
Total current liabilities                         6,835,000,000

Debt, net of current portion                      3,222,000,000
Deferred income taxes, net of current portion       602,000,000
Long-term derivative liabilities                    489,000,000
Long-term liabilities                               275,000,000
                                                ---------------
Total liabilities not subject to compromise      11,423,000,000
Liabilities subject to compromise                15,249,000,000

Minority interests                                    3,000,000
Stockholders' equity (deficit):
   Common stock                                       1,000,000
   Additional paid-in capital                     3,269,000,000
   Additional paid-in capital, loaned shares         22,000,000
   Additional paid-in capital, returnable shares    (22,000,000)
   Accumulated deficit                          (11,337,000,000)
   Accumulated other comprehensive loss             (42,000,000)
                                                ---------------
Total stockholders' deficit                      (8,109,000,000)
                                                 
Total liabilities and stockholders' deficit     $18,566,000,000
                                                ===============


                       Calpine Corporation
         Consolidated Condensed Statement of Operations
               For the period ending June 30, 2007

Revenue:
Electricity and steam revenue                      $539,000,000
Sales of purchased power and gas
    for hedging and optimization                    163,000,000
Mark-to-market activities, net                       61,000,000
Other revenue                                        11,000,000
                                                   ------------
Total revenue                                       774,000,000

Cost of revenue:
Plant operating expense                              68,000,000
Purchased power and gas expense
   for hedging and optimization                     123,000,000
Fuel expense                                        367,000,000
Depreciation & amortization expense                  39,000,000
Operating plant impairments                                   0
Operating lease expense                               4,000,000
Other cost of revenue                                14,000,000
                                                   ------------
Total cost of revenue                               615,000,000

Gross profit (loss)                                 159,000,000
Equipment, development project & other impairments            0
Sales, general and administrative expense            10,000,000
Other operating expenses                              1,000,000
                                                   ------------
Income (loss) from operations                       148,000,000
Interest expense                                     91,000,000
Interest (income)                                    (2,000,000)
Minority interest expense                            (1,000,000)
Other (income) expense, net                          (1,000,000)
                                                   ------------
Income (loss) before reorganization items
   & provision (benefit) for income taxes            61,000,000
Reorganization items                                 76,000,000
                                                   ------------
Income (loss) before provision
   (benefit) for income taxes                       (15,000,000)
Provision (benefit) for income taxes                (16,000,000)
                                                   ------------
Net income (loss)                                    $1,000,000
                                                   ============

Based in San Jose, California, Calpine Corporation (OTC Pink
Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers
and communities with electricity from clean, efficient, natural
gas-fired and geothermal power plants.  Calpine owns, leases and
operates integrated systems of plants in 21 U.S. states and in
three Canadian provinces.  Its customized products and services
include wholesale and retail electricity, gas turbine components
and services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services.

The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200).  Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts.  Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors.  As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities.

On June 20, 2007, the Debtors filed their Chapter 11 Plan and
Disclosure Statement.  On Aug. 27, 2007, the Debtors filed their
Amended Plan and Disclosure Statement.  The hearing to consider
the adequacy of the Disclosure Statement has been reset to
Sept. 25.  (Calpine Bankruptcy News, Issue No. 59 Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or   
215/945-7000).


CALPINE CORP: Posts $27,000,000 Net Loss in July 2007
-----------------------------------------------------

                       Calpine Corporation
              Consolidated Condensed Balance Sheet
                       As of July 31, 2007

                             ASSETS

Current assets:
   Cash and cash equivalents                    $1,358,000,000
   Accounts receivable, net                      1,072,000,000
   Inventories                                     129,000,000
   Margin deposits and other prepaid expense       420,000,000
   Restricted cash, current                        429,000,000
   Current derivative assets                       244,000,000
   Assets held for sale                            379,000,000
   Other current assets                             55,000,000
                                               ---------------
Total current assets                             4,086,000,000

Property, plant and equipment, net              12,723,000,000
Restricted cash, net of current portion            148,000,000
Investments                                        274,000,000
Long-term derivative assets                        343,000,000
Non-current assets held for sale                             -
Other assets                                       990,000,000
                                               ---------------
Total assets                                   $18,564,000,000
                                               ===============

              LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
   Accounts payable                               $694,000,000
   Accrued interest payable                        220,000,000
   Debt, current                                 4,876,000,000
   Current derivative liabilities                  253,000,000
   Income taxes payable                             38,000,000
   Liabilities held for sale                       276,000,000
   Other current liabilities                       395,000,000
                                               ---------------
Total current liabilities                        6,752,000,000

Debt, net of current portion                     3,209,000,000
Deferred income taxes, net of current portion      618,000,000
Long-term derivative liabilities                   455,000,000
Long-term liabilities                              280,000,000
                                               ---------------
Total liabilities not subject to compromise     11,314,000,000
Liabilities subject to compromise               15,349,000,000

Minority interests                                   8,000,000

Stockholders' equity (deficit):
   Common stock                                      1,000,000
   Additional paid-in capital                    3,270,000,000
   Additional paid-in capital, loaned shares        22,000,000
   Additional paid-in capital, returnable shares   (22,000,000)
   Accumulated deficit                         (11,364,000,000)
   Accumulated other comprehensive loss            (14,000,000)
                                               ---------------
Total stockholders' deficit                     (8,107,000,000)

Total liabilities and stockholders' deficit    $18,564,000,000
                                               ===============


                       Calpine Corporation
         Consolidated Condensed Statement of Operations
               For the period ending July 31, 2007

Revenue:
   Electricity and steam revenue                  $570,000,000
   Sales of purchased power and gas
      for hedging and optimization                 180,000,000
   Mark-to-market activities, net                    8,000,000
   Other revenue                                     2,000,000
                                                --------------
Total revenue                                      760,000,000

Cost of revenue:
   Plant operating expense                          58,000,000
   Purchased power and gas expense
      for hedging and optimization                 101,000,000
   Fuel expense                                    384,000,000
   Depreciation & amortization expense              39,000,000
   Operating plant impairments                               -
   Operating lease expense                           5,000,000
   Other cost of revenue                            10,000,000
                                                --------------
Total cost of revenue                              597,000,000

Gross profit (loss)                                163,000,000
Equipment, development project & other impairments           0
Sales, general and administrative expense           13,000,000
Other operating expenses                            (7,000,000)
                                                --------------
Income (loss) from operations                      157,000,000
Interest expense                                    94,000,000
Interest (income)                                   (5,000,000)
Minority interest expense                                    0
Other (income) expense, net                          3,000,000
                                                --------------
Income (loss) before reorganization items
   & provision (benefit) for income taxes           65,000,000
Reorganization items                                86,000,000
                                                --------------
Income (loss) before provision
   (benefit) for income taxes                      (21,000,000)
Provision (benefit) for income taxes                 6,000,000
                                                --------------
Net income (loss)                                  (27,000,000)

Based in San Jose, California, Calpine Corporation (OTC Pink
Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers
and communities with electricity from clean, efficient, natural
gas-fired and geothermal power plants.  Calpine owns, leases and
operates integrated systems of plants in 21 U.S. states and in
three Canadian provinces.  Its customized products and services
include wholesale and retail electricity, gas turbine components
and services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services.

The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200).  Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts.  Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors.  As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities.

On June 20, 2007, the Debtors filed their Chapter 11 Plan and
Disclosure Statement.  On Aug. 27, 2007, the Debtors filed their
Amended Plan and Disclosure Statement.  The hearing to consider
the adequacy of the Disclosure Statement has been reset to
Sept. 25.  (Calpine Bankruptcy News, Issue No. 59 Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or   
215/945-7000).


DANA CORP: Earns $11,000,000 in Month Ended July 31, 2007
---------------------------------------------------------

                        Dana Corporation
                Unaudited Condensed Balance Sheet
                        At July 31, 2007

ASSETS

CURRENT ASSETS
  Cash and cash equivalent assets               $1,078,000,000
  Accounts receivable
     Trade                                       1,264,000,000
     Other                                         317,000,000
  Inventories                                      825,000,000
  Assets of discontinued operations                101,000,000
  Other current assets                             141,000,000
                                                --------------
     Total current assets                        3,726,000,000

Investments and other assets                                 0
Investments in equity affiliates                   435,000,000
Net property, plant and equipment                1,730,000,000
Other noncurrent assets                          1,000,000,000
                                                --------------
TOTAL ASSETS                                    $6,891,000,000
                                                ==============

LIABILITY AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
  DIP Financing                                   $900,000,000
  Notes payable, including current portion
     of long-term debt                              39,000,000
  Accounts payable                               1,069,000,000
  Liabilities of discontinued operations            45,000,000
  Other accrued liabilities                        832,000,000
                                                --------------
Total current liabilities                        2,885,000,000

Liabilities subject to compromise                3,971,000,000
Deferred employee benefits and other
  non-current liabilities                          473,000,000
Long-term debt                                      13,000,000
Minority interest in consolidated subsidiaries      93,000,000
                                                --------------
Total liabilities                                7,435,000,000
Shareholder' equity (deficit)                     (544,000,000)
                                                --------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      $6,891,000,000
                                                ==============


                        Dana Corporation
           Unaudited Condensed Statement of Operations
                For the Month Ended July 31, 2007

Net Sales                                         $659,000,000
Costs and expenses
  Costs of sales                                   629,000,000
  Selling, general and administrative expenses      27,000,000
  Realignment charges                                4,000,000
  Other income, net                                 12,000,000
                                                --------------
Income (loss) from operations                       11,000,000
Interest expense                                     9,000,000
Reorganization charges                              12,000,000
                                                --------------
Income (loss) before income taxes                  (10,000,000)
Income tax (expense) benefit                         6,000,000
Minority interest                                    2,000,000
Equity in earnings of affiliates                     1,000,000
                                                --------------
Income (loss) before continuing operations         (17,000,000)
Income (loss) from discontinued operations          28,000,000
                                                --------------
Net income (loss)                                  $11,000,000
                                                ==============


                        Dana Corporation
           Unaudited Condensed Statement of Cash Flow
                For the Month Ended July 31, 2007

OPERATING ACTIVITIES
Net income (loss)                                  $11,000,000
Depreciation and amortization                       23,000,000
Loss on sale of business                           (39,000,000)
Non-cash portion of U.K. pension charge                      0
Decrease (increase) in working capital              31,000,000
Unremitted equity earnings in affiliates            (1,000,000)
Other                                               (1,000,000)
                                                --------------
Net cash flow provided by
(used for) operating activities                     24,000,000

INVESTING ACTIVITIES,
Purchases of property, plant and equipment         (15,000,000)
Proceeds from sale of assets                        64,000,000
Other                                                3,000,000
                                                --------------
Net cash flow provided by
(used for) operating activities                     52,000,000

FINANCING ACTIVITIES
Net change in short-term debt                        1,000,000
Proceeds from DIP facility                                   0
                                                --------------
Net cash flow provided by
(used for) financing activities                      1,000,000

Net increase in cash equivalents                    77,000,000
                                                --------------
Cash and cash equivalents, beginning of period   1,001,000,000

Cash and cash equivalents, end of period        $1,078,000,000
                                                ==============

Toledo, Ohio-based Dana Corp. -- http://www.dana.com/-- designs
and manufactures products for every major vehicle producer in the
world, and supplies drivetrain, chassis, structural, and engine
technologies to those companies.  Dana employs 46,000 people in
28 countries.  Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.  

The company and its affiliates filed for chapter 11 protection on
Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  As of Sept. 30,
2005, the Debtors listed $7,900,000,000 in total assets and
$6,800,000,000 in total debts.

Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in
Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors.  Henry S. Miller at
Miller Buckfire & Co., LLC, serves as the Debtors' financial
advisor and investment banker.  Ted Stenger from AlixPartners
serves as Dana's Chief Restructuring Officer.  

Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP,
represents the Official Committee of Unsecured Creditors.  Fried,
Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the
Official Committee of Equity Security Holders.  Stahl Cowen
Crowley, LLC serves as counsel to the Official Committee of
Non-Union Retirees.  

The Debtors' filed their Joint Plan of Reorganization on Aug. 31,
2007.  (Dana Corporation Bankruptcy News, Issue No. 51; Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or   
215/945-7000).


FEDERAL-MOGUL: Post $21.1 Million Net Loss in July 2007
-------------------------------------------------------

                Federal-Mogul Global, Inc., et al.
                Unaudited Statement of Operations
                For the Month Ended July 31, 2007
                          (In millions)

Net sales                                                $233.1
Cost of products sold                                     196.2
                                                       --------
Gross margin                                               37.0

Selling, general & administrative expenses                (43.9)
Amortization                                               (1.2)
Reorganization items                                       (6.3)
Interest income (expense), net                            (15.1)
Other income (expense), net                                 8.6
                                                       --------
Earnings before Income Taxes                              (20.8)

Income Tax (Expense) Benefit                               (0.3)
                                                       --------
Earnings before cumulative effect of change
   in accounting principle                                (21.1)
                                                       --------
Net Earnings (loss)                                      ($21.1)
                                                       ========


                Federal-Mogul Global, Inc., et al.
                Unaudited Statement of Cash Flows
                For the month ended July 31, 2007
                          (In millions)

Cash Provided From (Used By) Operating Activities:
   Net earning (loss)                                    ($21.1)
Adjustments to reconcile net earnings (loss) to net cash:
   Depreciation and amortization                           12.2
   Adjustment of assets held for sale and
      other long-lived assets to fair value                   -
   Asbestos charge                                            -
   Summary of unpaid postpetition debits                      -
   Cumulative effect of change in acctg. principle            -
   Change in post-employment benefits                      (9.8)
   Decrease (increase) in accounts receivable              55.7
   Decrease (increase) in inventories                     (10.9)
   Increase (decrease) in accounts payable                (15.2)
   Change in other assets & other liabilities             (15.9)
   Change in restructuring charge                             -
   Refunds (payments) against asbestos liability              -
                                                       --------
Net Cash Provided From Operating Activities                (4.9)

Cash Provided From (Used By) Investing Activities:
   Expenditures for property, plant & equipment            (7.2)
   Proceeds from sale of property, plant & equipment          -
   Proceeds from sale of businesses                           -
   Business acquisitions, net of cash acquired                -
   Other                                                      -
                                                       --------
Net Cash Provided From (Used By) Investing Activities      (7.2)

Cash Provided From (Used By) Financing Activities:
   Increase (decrease) in debt                             (9.3)
   Sale of accounts receivable under securitization           -
   Dividends                                                  -
   Other                                                    0.7
                                                       --------
Net Cash Provided From Financing Activities                (8.6)

Increase (Decrease) in Cash and Equivalents               (20.7)

Cash and equivalents at beginning of period                79.8
                                                       --------
Cash and equivalents at end of period                     $59.1
                                                       ========

The Debtors' assets totaled $6,483,000,000 as of July 31, 2007.  
Liabilities were at $8,014,000,000.

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

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

On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan.
They submitted a Disclosure Statement explaining that plan on
April 21, 2003.  They submitted several amendments and on June 6,
2004, the Bankruptcy Court approved the Third Amended Disclosure
Statement for their Third Amended Plan.  On July 28, 2004, the
District Court approved the Disclosure Statement.  The estimation
hearing began on June 14, 2005.  They then submitted a Fourth
Amended Plan and Disclosure Statement on Nov. 21, 2006, and the
Bankruptcy Court approved that Disclosure Statement on Feb. 6,
2007.  The confirmation hearing began June 18, 2007, and is set  
to conclude on Oct. 1, 2007.  (Federal-Mogul Bankruptcy News,
Issue No. 146; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: Posts $1,497,000 Net Loss in August 2007
---------------------------------------------------------

             Hancock Fabrics, Inc. and Subsidiaries
                   Consolidated Balance Sheet
                      As of August 4, 2007

ASSETS

Current assets:
   Cash and cash equivalents                        $8,904,000
   Receivables, less allowance for
      doubtful accounts                              5,736,000
   Inventories                                      78,252,000
   Income taxes refundable                           7,116,000
   Prepaid expenses                                  2,217,000
                                                 -------------
   Total current assets                            102,225,000

Property and equipment                              43,883,000
Other assets                                        15,311,000
                                                 -------------
Total Assets                                      $161,419,000
                                                 =============
LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities not subject to compromise
   Accounts payable                                $15,218,000
   Credit facility; DIP financing                   17,500,000
   Accrued liabilities                               8,198,000
   Deferred tax liabilities                          7,152,000

Liabilities subject to compromise
   Accounts payable                                 27,619,000
   Accrued liabilities                              14,331,000
   Long-term lease financing obligations             1,682,000
   Capital lease obligations                         1,718,000
   Postretirement benefits other than pensions       9,403,000
   Pension and SERP liabilities                      8,690,000
   Other liabilities                                 9,121,000
                                                 -------------
Total Liabilities                                  120,632,000
Total Shareholders' Equity                          40,787,000
                                                 -------------
Total liabilities and shareholders' equity        $161,419,000
                                                 =============


             Hancock Fabrics, Inc., and Subsidiaries
              Consolidated Statement of Operations
                For the Month Ended August 4, 2007

Sales                                              $17,668,000
Cost of goods sold                                   9,511,000
                                                 -------------
Gross profit                                         8,157,000

Selling, general & admin expense                     8,167,000
Depreciation and amortization                           62,000
                                                 -------------
Operating income (loss)                                (72,000)

Reorganization expenses                                908,000
Interest expense, net                                  517,000
                                                 -------------
Earnings (loss) before income taxes                 (1,497,000)
Income taxes                                                 0
                                                 -------------
Net earnings (loss)                                ($1,497,000)
                                                 =============


             Hancock Fabrics, Inc., and Subsidiaries
               Consolidated Statement of Cash Flow
                For the Month Ended August 4, 2007

Cash flows from operating activities:
   Net earnings                                    ($1,497,000)
   Adjustments to reconcile net
   earnings to cash flows used in
   operating activities
      Depreciation and amortization                   (436,000)
      Amortization of deferred loan costs              235,000
      LIFO charge (credit)                             282,000
      Reserve for store closings credits               221,000
      Reserve for obsolete inventory                         0
      Reserve for sales returns and bad debts            3,000
      Stepped rent accrual                             181,000
      Loss on disposition of property & equipment   (2,023,000)
      Gain on disposition of lease
         financing obligations                               0
      Stock compensation expense                      (113,000)
   (Increase) decrease in assets
      Receivables and prepaid expenses                (466,000)
      Inventory at current cost                        149,000
      Other non-current assets                        (589,000)
   Increase (decrease) in liabilities
      Accounts payable                                 177,000
      Accrued liabilities                               87,000
      Postretirement benefits other than pensions     (122,000)
      Long-term pension and SERP liabilities           156,000
      Reserve for store closings                       (94,000)
      Other liabilities                                101,000
                                                  ------------
Net cash used in operating activities               (2,817,000)

Cash flows from investing activities:
   Additions to property and equipment                 (21,000)
   Proceeds from the disposition of
      property and equipment                         3,165,000
                                                 -------------
Net cash used in investing activities                3,144,000

Cash flows from financing activities:
   Net borrowings on revolving credit agreement              0
   Payments for lease financing                         (1,000)
   Payments for capital leases                          (3,000)
   Payments for loan costs                                   0
   Purchase of treasury stock                                0
   Tax obligation settled with treasury stock                0
                                                 -------------
Net cash provided by financing activities              (4,000)
                                                 -------------
Decrease in cash and cash equivalents                  323,000
Cash, beginning of period                            8,581,000
                                                 -------------
Cash, end of period                                 $8,904,000
                                                 =============

Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc.
(OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty  
retailer of a wide selection of fashion and home decorating
textiles, sewing accessories, needlecraft supplies and sewing
machines.  Hancock Fabrics is one of the largest fabric retailers
in the United States, currently operating approximately 400 retail
stores in approximately 40 states.  The company employs
approximately 7,500 people on a full-time and part-time basis.
Most of the company's employees work in its retail stores, or in
field management to support its retail stores.

The company and six of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.  The Court extended
the Debtors exclusive period to file a Chapter 11 Plan to Feb. 28,
2008.  (Hancock Fabric Bankruptcy News, Issue No. 16, Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or   
215/945-7000).


SOLUTIA INC: Earns $8,000,000 in Period Ending July 31, 2007
------------------------------------------------------------

                  Solutia Chapter 11 Debtors
      Unaudited Statement of Consolidated Financial Position
                     As of July 31, 2007

                            ASSETS

Cash                                                $52,000,000
Trade Receivables, net                              223,000,000
Account Receivables-Unconsolidated Subsidiaries      58,000,000
Inventories                                         166,000,000
Other Current Assets                                 98,000,000
Assets of Discontinued Operations                     6,000,000
                                                 --------------
Total Current Assets                                603,000,000

Property, Plant and Equipment, net                  652,000,000
Investments in Subsidiaries and Affiliates          687,000,000
Intangible Assets, net                              100,000,000
Other Assets                                         55,000,000
                                                 --------------
Total Assets                                     $2,097,000,000
                                                 ==============

               LIABILITIES AND SHAREHOLDERS' DEFICIT

Accounts Payable                                   $210,000,000
Short Term Debt                                     922,000,000
Other Current Liabilities                           160,000,000
Liabilities of Discontinued Operations                3,000,000
                                                 --------------
Total Current Liabilities                         1,295,000,000

Long-Term Debt                                                0
Other Long-Term Liabilities                         195,000,000
                                                 --------------
Total Liabilities not Subject to Compromise       1,490,000,000

Liabilities Subject to Compromise                 1,871,000,000

Shareholders' Deficit                            (1,264,000,000)
                                                 --------------
Total Liabilities & Shareholders' Deficit        $2,097,000,000
                                                 ==============


                   Solutia Chapter 11 Debtors
         Unaudited Consolidated Statement of Operations
                For the Month Ended July 31, 2007

Total Net Sales                                    $232,000,000
Total Cost Of Goods Sold                            205,000,000
                                                 --------------
Gross Profit                                         27,000,000

Total MAT Expense                                    14,000,000
                                                 --------------
Operating Income (Loss)                              13,000,000

Equity Earnings from Affiliates                               0
Interest Expense, net                                (8,000,000)
Other Income, net                                     7,000,000

Reorganization Items:
Professional fees                                    (6,000,000)
Employee severance and retention costs               (1,000,000)
Settlements of prepetition claims                     3,000,000
                                                 --------------
                                                     (4,000,000)
                                                 --------------
Income from continuing operations before taxes        8,000,000

Income tax expense (benefit)                                  0

Income from discontinued operations                           0
                                                 --------------
Net Income                                           $8,000,000
                                                 ==============

Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in the
manufacture and sale of chemical-based materials, which are used
in consumer and industrial applications worldwide.  The company
and 15 debtor-affiliates filed for chapter 11 protection on Dec.
17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949).  When the
Debtors filed for protection from their creditors, they listed
$2,854,000,000 in assets and $3,223,000,000 in debts.

Solutia is represented by Allen E. Grimes, III, Esq., at
Dinsmore & Shohl, LLP and Conor D. Reilly, Esq., at Gibson,
Dunn & Crutcher, LLP.  Trumbull Group LLC is the Debtor's claims
and noticing agent.  Daniel H. Golden, Esq., Ira S. Dizengoff,
Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer &
Feld LLP represent the Official Committee of Unsecured Creditors,
and Derron S. Slonecker at Houlihan Lokey Howard & Zukin Capital
provides the Creditors' Committee with financial advice.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Debtors have asked the Court to extend
their exclusive plan filing period to Dec. 31, 2007.  The
Disclosure Statement hearing began July 10, 2007, and is set to
continue on Sept. 20, 2007.  (Solutia Bankruptcy News, Issue No.
97; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                             *********

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
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Each Tuesday edition of the TCR contains a list of companies with
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                             *********

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 R. Jusay, and
Peter A. Chapman, Editors.

Copyright 2007.  All rights reserved.  ISSN: 1520-9474.

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