T R O U B L E D C O M P A N Y R E P O R T E R Friday, November 9, 2007, Vol. 11, No. 266 Headlines 14 WALL: Case Summary & 20 Largest Unsecured Creditors 888 TACTICAL: Moody's Cuts Rating on $50 Mil. Class B Notes to Ba3 ACE SECURITIES: Moody's Junks Ratings on Seven Certificate Classes AES CORP: Seeking Regulators' Approval on Two Gas Projects ALLIANCE BANCORP: Moody's Cuts Ratings on Class M3 Certs. to B3 ALLTEL CORP: Fitch Lowers Issuer Default Rating to B from BB- ALTIUS IV: Moody's Places Ba1 Rating Under Negative Watch AMERICAN COLOR: Moody's Downgrades Corporate Family Rating to Ca AMERICAN HOME: Wants Removal of Actions Period Moved to March 4 AMERICAN HOME: Court Sets January 11 as General Claims Bar Date AMERICAN HOME: Court Extends Cash Collateral Access Until Nov. 15 AMERICAN HOME: Moody's Junks Ratings on Five Certificate Classes ANDERSON MEZZANINE: Moody's Reviews Junk Ratings for Possible Cut ARVINMERITOR INC: Closing North Carolina Operations in Sept. 2008 ASSEN DAIRY: Case Summary & 19 Largest Unsecured Creditors ATARI INC: June 30 Balance Sheet Upside-Down by $8.6 Million BALLY TECHNOLOGIES: Buying Compudigm's Gaming Power & seePOWER BALLYROCK ABS: Moody's Cuts Rating on $26 Mil. Secured Notes to B3 BARNERT HOSPITAL: Wants to Obtain $5 Mil. DIP Funding from HCFFA BEAR STEARNS: Fitch Cuts Rating on Class II-B-4 Cert. to BB- BEAR STEARNS: Fitch Lowers Ratings on Three Certificate Classes BEAR STEARNS: Moody's Junks Ratings on Nine Certificate Classes BERNOULLI HIGH: Moody's Puts Ba2 Rated Sr. Notes Under Neg. Watch BF SAUL: Moody's Changes Rating Outlook from Stable to Negative BILTMORE CDO: Moody's Reviews Ba3 Rating for Possible Downgrade C-BASS MORTGAGE: Moody's Junks Ratings on Two Certificate Classes CAPITAL CONSORTIUM: Trustee Asks Court to Dismiss Chapter 11 Case BLACKHAWK AUTOMOTIVE: Donlin Retained as Claims Agent CATALYST PAPER: $90 Mil. Capital Spending Expected by Year End CENTEX HOME: Moody's Cuts Ratings on Three Cert. Classes to Low-B CHEMTURA CORPORATION: Earns $2 Million in 2007 Third Quarter CHEMTURA CORP: Sells Optical Monomers Business to Acomon AG CHESAPEAKE ENERGY: Earns $372.1 Million in Quarter Ended Sept. 30 CHEVY CHASE: Moody's Changes Outlook from Stable to Negative CHRYSLER AUTOMOTIVE: Moody's Junks Rating on $2 Bil. Senior Debt CHRYSLER FINANCIAL: Moody's Affirms B1 Corporate Family Rating CHRYSLER LLC: Labor Agreement Does Not Affect Fitch's Rating CITATION HIGH: Moody's Puts Ba3 Rated $11MM Notes Under Neg. Watch CLASSICSTAR LLC: U.S. Trustee Appoints 9-Member Creditors Panel COMPASS GROUP: S&P Assigns 'BB-' Corporate Credit Rating COOPER TIRE: Earns $30 Million in 3rd Quarter Ended September 30 CREDIT SUISSE: Fitch Puts Low-B Ratings on Two Cert. Classes CREDIT SUISSE: Stable Performance Cues Fitch to Hold Ratings CSAB MORTGAGE: Higher Delinquency Rates Cue Moody's To Cut Ratings CSFB HOME: Moody's Junks Ratings on Three Certificate Classes CSFB MORTGAGE: Higher Foreclosure Rates Cue Moody's To Cut Ratings DANIEL WILLIAMS: Case Summary & 20 Largest Unsecured Creditors DELPHINUS CDO: Moody's Places Caa3 Ratings Under Negative Watch DELTA AIR: Inks $1BB Parts Manufacturing Deal with Chromalloy Gas DIRECTV GROUP: Earns $319 Million in Third Quarter Ended Sept. 30 DOMTAR CORP: Earns $36 Million in Third Quarter Ended Sept. 30 DURANT CDO: Moody's Cuts Rating on $25MM Floating Rate Note to B3 ECO 2007: Moody's Puts Caa3 Rating Under Review for Possible Cut EMA PIZZA: Case Summary & 32 Largest Unsecured Creditors ENDOCARE INC: Posts $984,000 Net Loss in Quarter Ended Sept. 30 ENTERGY CORP: Outlook Revision Does Not Affect Fitch's BB Rating EULER ABS: Moody's May Downgrade Ba2 Rating on $14 Million Notes FIDELITY SEDGWICK: Fitch Affirms 'B' Issuer Default Rating FIRST FRANKLIN: Moody's Junks Ratings on Four Certificate Classes FIRST UNION: Stable Performance Cues Fitch to Affirm Ratings FORGE ABS: Poor Credit Quality Prompts Moody's Ratings Review FOURTH STREET: Moody's Reviews Low-B Ratings for Possible Cut GE COMMERCIAL: Moody's Holds Low-B Ratings on Six Cert. Classes GENERAL CABLE: Earns $61.1 Million in 2007 Third Quarter GENERAL MOTORS: Posts $39 Billion Net Loss in Third Quarter GENERAL MOTORS: Moody's Affirms Ratings; Changes Outlook to Stable GERDAU AMERISTEEL: Completes Offering of 126.5 Million Shares GMAC COMMERCIAL: Fitch Keeps Junk Ratings on $10.9 Million Certs. HARBORVIEW MORTGAGE: Moody's May Lift Ba2 Rating on Cl. B-4 Certs. HARRAH'S ENTERTAINMENT: Earns $244.4 Million in Third Quarter HOMETOWN COMMERCIAL: Fitch Holds 'B-' Rating on $737,000 Certs. INVERNESS MEDICAL: Completes Stock for Stock Deal With HemoSense IWT TESORO: Court Approves Donlin Recano as Claims Agent IWT TESORO: Brings In Rader & Coleman as Special Counsel IWT TESORO: Hires Rattet Pasternak as Bankruptcy Counsel JOHN B SANFILIPPO: Posts $3.5 Mil. Net Loss in FY 2008 1st Quarter JP MORGAN: Fitch Holds 'BB-' Rating on $4 Mil. Class H Certs. JUPITER HIGH: Moody's May Pare Ba3 Rating on $10MM Class C Notes KELLWOOD CO: S&P Retains Ratings Under Negative CreditWatch KEY ENERGY: Mulls Private Offer of $400 Million Senior Notes KNOLLWOOD CDO: Moody's Junks Rating on $16.1 Million Class E Notes LANCER FUNDING: Moody's Junks Ratings on Two Floating Rate Notes LASALLE COMM'L: Moody's Junks Rating on Class M 2005-MF1 Certs. LEVITZ FURNITURE: Files for Chapter 11 Protection in New York LEXICON UNITED: Sept. 30 Balance Sheet Upside-Down by $1.1 Million LONG BEACH: Moody's Junks Ratings on Three Certificate Classes MARSICO PARENT: Moody's Assigns B2 Corporate Family Rating MATRIX INT'L: May Default on $1.25 Mil. Deal w/ Cayman Government MCMORAN EXPLORATION: Mulls Offering of $400 Million Senior Notes MERRILL LYNCH: Moody's Cuts Ratings on 3 Cert. Classes to Low-B MGM MIRAGE: Inks $3 Billion Deal with Mubadala Development Company MICHIGAN INLINE: Voluntary Chapter 11 Case Summary MORGAN COMMERCIAL: Fitch Affirms 'BB+' Rating on $20.4 Mil. Certs. MORGAN STANLEY: Moody's Junks Ratings on 2 Series 2007 4-SL Certs. MOVIE GALLERY: Committee Taps Miles & Stockbridge as Co-Counsel MOVIE GALLERY: Committee Selects Pachulski Stang as Lead Counsel MOVIE GALLERY: Wants to Employ Ernst & Young as Tax Advisors NATIONSLINK FUNDING: Fitch Holds 'BB' Rating on $6.6 Mil. Certs. NEUMANN HOMES: Wants Until Dec. 17 To File Schedules & Statements NOMURA ASSET: Moody's Junks Ratings on Four Series 2007 S1 Certs. OFFICEMAX INC: Earns $49.9 Million in Quarter Ended September 29 ORGANITECH USA: Sept. 30 Balance Sheet Upside-Down by $538,523 PCS EDVENTURES!.COM: Posts Net Loss of $261,513 in Second Quarter POPE & TALBOT: Unit Gets Court OK to Use Cash Flows Up To $23 Mil. POPE & TALBOT: CCAA Stay Order Amended to Allow U.S. Bankr. Filing PORT JACKSON: Moody's Cuts Rating on $15MM Secured Notes to Caa3 PORTFOLIO CREDIT: Moody's Junks Rating on Caribou Peak's Notes PORTFOLIO CREDIT: Moody's Junks Rating on $11,250,000 Notes PRC LLC: S&P Withdraws Ratings at Company's Request QUEBECOR WORLD: Inks $341 Million Sell/Merge Deal with RSDB NV RAM POWER: Involuntary Chapter 11 Case Summary REMY: Obtains $225MM Secured DIP Financing From Barclays Capital SACO I: Moody's Junks Ratings on Four Series 2007 Certificates SANMINA-SCI CORP: Posts $1.1 Billion Net loss in Fiscal 2007 SCO GROUP: Wants to Sell Certain Assets to JGD for $36,000,000 SCO GROUP: IBM and Novell Balk at Proposed Asset Sale Procedure SEMAN INVESTMENTS: Case Summary & Largest Unsecured Creditor SOUNDVIEW HOME: Moody's Junks Rating on Class B-2 Certificates ST. GERMAIN: Wind-Down of Operations Cues Fitch to Junk Rating STEPHEN SIEBER: Voluntary Chapter 11 Case Summary STRUCTURED ASSET: Fitch Junks Ratings on Two Cert. Classes STRUCTURED ASSET: Moody's Cuts Ratings on 2 Cert. Classes to Low-B SUMMER STREET: Moody's Junks Rating on $17.5 Mil. Class D Notes SUNTRUST ALTERNATIVE: Fitch Junks Ratings on Two Cert. Classes TEREX CORP: Acquires Superior Highwall for $140 Million Cash TEREX CORP: Mulls Issuance of $500 Mil. Senior Subordinated Notes TIMBERWOLF I: Moody's Cuts Rating on $30 Million Notes to Caa3 UNITED RENTALS: S&P To Cut Rating to B+ Upon CCM Deal Closing UNITED RENTALS: Moody's Assigns B2 Corporate Family Rating WADSWORTH CDO: Moody's Cuts Ratings on Three Note Classes to Low-B WCI COMMUNITIES: Expects $46 Mil. Annual Savings from 575 Job Cut WESTLAKE CHEMICAL: S&P Holds All Ratings and Revises Outlook WHEELING PITTSBURGH: CEO Urges Shareholders to Vote for Merger YOUBET.COM: Earns $67,000 in Third Quarter Ended September 30 YOUBET.COM: Joseph Barletta Tenders Resignation from Board * Andrea Schwartz Joins Fulbright & Jaworski Law Firm * Donlin Retained as Claims Agent for Blackhawk's Chapter 11 Case * Moody's Says Hedging Rarely Alters Ratings for Oil & Gas Firms * BOOK REVIEW: Ancient Law (Law Classic) ********* 14 WALL: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------ Debtor: 14 Wall Street Jewelers, Inc. 14 Wall Street New York, NY 10005 Bankruptcy Case No.: 07-13516 Chapter 11 Petition Date: November 7, 2007 Court: Southern District of New York (Manhattan) Judge: Robert D. Drain Debtor's Counsel: Dawn K. Arnold, Esq. Rattet, Pasternak & Gordon-Oliver, LLP 550 Mamaroneck Avenue Harrison, NY 10528 Tel: (914) 381-7400 Fax: (914) 381-7406 Estimated Assets: $100,000 to $1 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Hourglass Trading $300,000 306 West Somerdale Road Voorhees, NJ 08043 Prime Time $250,000 36 West 47th Street, Booth #4 New York, NY 10036 BOC Inc. $176,000 36 West 47th Street Suite 705 New York, NY 10036 American Express $157,832 Aloni Diamonds $156,000 Laurel Watch Inc. $131,000 Unique Settings $108,000 ESQ Swiss Watches $100,000 Movado Watch Co. $100,000 M. Abaronoff Co. Inc. $97,797 American Express Merchant Services $93,271 Charles Gazal $90,000 Kelsol Diamond Co., Inc. $90,000 Signature Bank $85,000 BETA USA Inc. $80,000 Greff Ruth $80,000 Jadar Watches $80,000 Prince Diamond Inc. $80,000 TimePiece Trader $50,900 GN Diamond $50,537 888 TACTICAL: Moody's Cuts Rating on $50 Mil. Class B Notes to Ba3 ------------------------------------------------------------------ Moody's Investors Service placed on review for possible downgrade these classes of Notes issued by 888 Tactical Fund, Ltd.: Class Description: $39,200,000 Class S Floating Rate Notes due 2015 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: Up to $500,000,000 Class A1 Floating Rate Notes due 2050 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade In addition, Moody's downgraded and left on review for possible downgrade these classes of Notes: Class Description: $200,000,000 Class A2 Floating Rate Notes due 2050 -- Prior Rating: Aaa -- Current Rating: A1, on review for possible downgrade Class Description: $120,000,000 Class A3 Floating Rate Notes, due 2050 -- Prior Rating: Aaa -- Current Rating: A3, on review for possible downgrade Class Description: $75,000,000 Class A4 Floating Rate Notes due 2050 -- Prior Rating: Aa2 -- Current Rating: Baa3, on review for possible downgrade Class Description: $50,000,000 Class B Deferrable Floating Rate Notes due 2050 -- Prior Rating: A2 -- Current Rating: Ba3, on review for possible downgrade Class Description: $35,000,000 Class C Deferrable Floating Rate Notes due 2050 -- Prior Rating: Baa2 -- Current Rating: B3, on review for possible downgrade According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's underlying collateral pool. ACE SECURITIES: Moody's Junks Ratings on Seven Certificate Classes ------------------------------------------------------------------ Moody's Investors Service downgraded 88 classes of certificates and placed on review for possible downgrade 18 classes of certificates from 18 transactions issued in early 2007 and backed by closed-end second lien mortgage loans. A closed-end second lien mortgage loan is a loan secured by a second priority mortgage lien on residential real estate, and is advanced in a specified amount at the closing of the loan. When closed simultaneously with a first-lien mortgage loan to purchase a home, these loans are often known as 'piggyback loans'. The actions reflect the extremely poor performance of closed-end second lien mortgage loans securitized in early 2007. These loans have seen a high rate of early default and deals backed by those loans have been continuously building up significant pipeline. The performance closely tracks the performance of "piggyback loans' securitized in 2006 due to the aggressive underwriting guidelines combined with prolonged home price decline. Three Aaa-rated securities and 15 Aa-rated securities are placed under review for possible downgrade. Class A-1 and Class A-2 from ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASL1 have been placed on review due to the high cumulative loss (5.32% as of September) within 5 months of closing. The aggressive loan write-off didn't subdue the growth in pipeline which represents 11.85% of the current pool balance. Class II-A from American Home Mortgage Investment Trust is placed on review because of the significant delinquencies (15.61%of current pool balance as of September was 60 days or more delinquent most of which was in foreclosure) which are likely to deplete the overcollateralization, and cause writedowns to Classes II-M-6, II- M-5, II-M-4, II-M-3, and II-M-2. At the other end of the credit spectrum, 41 securities are downgraded to Caa, Ca, and C ratings because the dramatically pool overall performance of closed-end second lien mortgages has already impaired or is expected to impair tranches at the bottom of the capital structures. Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class M-4, Downgraded to Ba2 from A1; - Series 2007-ASL1, Class M-5, Downgraded to B1 from A2; - Series 2007-ASL1, Class M-6, Downgraded to B3 from A3; - Series 2007-ASL1, Class M-7, Downgraded to C from Baa1; - Series 2007-ASL1, Class M-8, Downgraded to C from Baa2; - Series 2007-ASL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba3 from A3; - Series 2007-SL1, Class M-7, Downgraded to Ca from Baa1; - Series 2007-SL1, Class M-8, Downgraded to C from Baa2; - Series 2007-SL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-10, Downgraded to C from Ba1. Issuer: Alliance Bancorp Trust - Series 2007-S1, Class M-2, Downgraded to Baa3 from A2; - Series 2007-S1, Class M-3, Downgraded to B3 from Baa2. Issuer: American Home Mortgage Assets Trust 2007-3 - Class III-M-2, Downgraded to Ba3 from A3; - Class III-P-O, Downgraded to Caa2 from Ba1. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-M-1, Downgraded to Ba1 from Aa2; - Series 2007-A, Class II-M-2, Downgraded to Caa3 from A3; - Series 2007-A, Class II-M-3, Downgraded to C from Baa2; - Series 2007-A, Class II-M-4, Downgraded to C from Baa3; - Series 2007-A, Class II-M-5, Downgraded to C from Ba2. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-4, Downgraded to Baa2 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa3 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL1, Class B-2, Downgraded to C from Baa2; - Series 2007-SL1, Class B-3, Downgraded to C from Baa3; - Series 2007-SL1, Class B-4, Downgraded to C from Ba1; - Series 2007-SL2, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL2, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL2, Class M-6, Downgraded to B1 from A3; - Series 2007-SL2, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL2, Class B-2, Downgraded to C from Baa2; - Series 2007-SL2, Class B-3, Downgraded to C from Baa3. Issuer: Bear Stearns Second Lien trust - Series 2007-1, Class II-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class II-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class II-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class II-B-1, Downgraded to Caa1 from Baa3; - Series 2007-1, Class III-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class III-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class III-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class III-B-1, Downgraded to Caa1 from Baa3. - Series 2007-SV1, Class B-3, Downgraded to Ba3 from Baa3; - Series 2007-SV1, Class B-4, Downgraded to B1 from Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-SL1 - Class B-1, Downgraded to Ba1 from Baa1; - Class B-2, Downgraded to B2 from Baa2; - Class B-3, Downgraded to Caa1 from Baa3; - Class B-4, Downgraded to Ca from Ba1. Issuer: CSFB Home Equity Mortgage Trust - Series 2007-2, Cl. M-1, Downgraded to Baa2 from A3; - Series 2007-2, Cl. M-2, Downgraded to Baa3 from Baa1; - Series 2007-2, Cl. M-3, Downgraded to B1 from Baa2; - Series 2007-2, Cl. M-4, Downgraded to Caa3 from Baa3; - Series 2007-2, Cl. B-1, Downgraded to Ca from Ba1; - Series 2007-2, Cl. B-2, Downgraded to C from Ba2. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-4, Downgraded to Baa3 from A1; - Series 2007-FFA, Class M-5, Downgraded to B1 from A2; - Series 2007-FFA, Class M-6, Downgraded to B3 from A3; - Series 2007-FFA, Class B-1, Downgraded to Ca from Baa1; - Series 2007-FFA, Class B-2, Downgraded to C from Baa2; - Series 2007-FFA, Class B-3, Downgraded to C from Baa3; - Series 2007-FFA, Class B-4, Downgraded to C from Ba1; - Series 2007-FFC, Class B-3, Downgraded to B2 from Baa3; - Series 2007-FFC, Class B-4, Downgraded to B3 from Ba1. Issuer: Merrill Lynch Mortgage Loan Trust - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to B1 from Baa1; - Series 2007-SL1, Class B-2, Downgraded to B3 from Baa2; - Series 2007-SL1, Class B-3, Downgraded to Caa2 from Baa3. Issuer: Morgan Stanley Mortgage Loan Trust - Series 2007-4SL, Class B-3, Downgraded to Ba3 from Baa2; - Series 2007-4SL, Class B-4, Downgraded to Caa2 from Ba1; - Series 2007-4SL, Class B-5, Downgraded to C from Ba2. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-5, Downgraded to Baa3 from A1; - Series 2007-S1, Class M-6, Downgraded to B1 from A3; - Series 2007-S1, Class M-7, Downgraded to Caa1 from A3; - Series 2007-S1, Class M-8, Downgraded to C from Baa1; - Series 2007-S1, Class M-9, Downgraded to C from Baa3; - Series 2007-S1, Class M-10, Downgraded to C from Ba1. Issuer: SACO I Trust - Series 2007-1, Class M-5, Downgraded to Baa1 from A1; - Series 2007-1, Class M-6, Downgraded to Baa2 from A2; - Series 2007-1, Class B-1, Downgraded to Ba3 from Baa1; - Series 2007-1, Class B-2, Downgraded to Caa2 from Baa1; - Series 2007-1, Class B-3, Downgraded to C from Baa3; - Series 2007-1, Class B-4, Downgraded to C from Ba1; - Series 2007-2, Class M-4, Downgraded to Baa2 from A1; - Series 2007-2, Class M-5, Downgraded to Ba3 from A2; - Series 2007-2, Class M-6, Downgraded to B3 from A3; - Series 2007-2, Class B-1, Downgraded to C from Baa1. Review for Possible Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class A-1, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class A-2, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class M-1, current rating Aa1, on review for possible downgrade; - Series 2007-ASL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-ASL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-A, current rating Aaa, on review for possible downgrade. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL2, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL2, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-FFA, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-3, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-4, current rating Aa3, on review for possible downgrade. Issuer: SACO I Trust - Series 2007-1, Class M-4, current rating Aa3, on review for possible downgrade; - Series 2007-2, Class M-3, current rating Aa3, on review for possible downgrade. AES CORP: Seeking Regulators' Approval on Two Gas Projects ---------------------------------------------------------- AES Corporation is seeking the U.S. Federal Energy Regulatory Commission's authorization for the construction of a liquefied natural gas terminal at the Sparrows Point shipyard and an 88-mile pipeline into Pennsylvania, The Baltimore Sun reports. The National Association of State Fire Marshals and federal regulators heeded a request from some Turners Station residents to consider the approval for liquefied natural gas projects, according to The Sun. The Fire Marshals and regulators will meet in Washington about the approval process. O'Rourke of the National Association of State Fire Marshals told The Sun, "Some folks who, to date, haven't been involved -- who missed those initial hearings -- wanted to learn about the LNG [liquefied natural gas] approval process." The Sun relates that many community leaders and officials have been opposing the project. The terminal would be a potential hazard to nearby homes in Dundalk, especially to those in Turners Station, The Sun says, citing sources. Federal officials had notified AES that the State Highway Administration would not grant the company access to construct its pipeline along the Baltimore Beltway. They asked the firm to present a new route for the pipeline, The Sun states. About AES Corporation AES Corporation, -- http://www.aes.com/-- a global power company, operates in South America, Europe, Africa, Asia and the Caribbean countries. Generating 44,000 megawatts of electricity through 124 power facilities, the company delivers electricity through 15 distribution companies. AES has been in Eastern Europe for over ten years, since it acquired three power plants in Hungary in 1996. Currently, AES has two distribution companies in Ukraine, which serve 1.2 million customers and generation plants in the Czech Republic and Hungary. AES is also the leading company in biomass conversion in Hungary, generating 37% of the nation's total renewable generation in 2004. * * * As reported in the Troubled Company Reporter on Oct. 12, 2007, Moody's Investors Service affirmed The AES Corporation's Corporate Family Rating at B1 and the senior unsecured rating assigned to its new senior unsecured notes offering at B1 following its upsizing to $2 billion from $500 million. Fitch Ratings assigned a 'BB/RR1' rating to AES Corporation's $2 billion issuance of senior unsecured notes maturing 2015 and 2017. AES' long-term Issuer Default Rating is rated 'B+' by Fitch. Fitch said the rating outlook is stable. ALLIANCE BANCORP: Moody's Cuts Ratings on Class M3 Certs. to B3 --------------------------------------------------------------- Moody's Investors Service downgraded 88 classes of certificates and placed on review for possible downgrade 18 classes of certificates from 18 transactions issued in early 2007 and backed by closed-end second lien mortgage loans. A closed-end second lien mortgage loan is a loan secured by a second priority mortgage lien on residential real estate, and is advanced in a specified amount at the closing of the loan. When closed simultaneously with a first-lien mortgage loan to purchase a home, these loans are often known as 'piggyback loans'. The actions reflect the extremely poor performance of closed-end second lien mortgage loans securitized in early 2007. These loans have seen a high rate of early default and deals backed by those loans have been continuously building up significant pipeline. The performance closely tracks the performance of "piggyback loans' securitized in 2006 due to the aggressive underwriting guidelines combined with prolonged home price decline. Three Aaa-rated securities and 15 Aa-rated securities are placed under review for possible downgrade. Class A-1 and Class A-2 from ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASL1 have been placed on review due to the high cumulative loss (5.32% as of September) within 5 months of closing. The aggressive loan write-off didn't subdue the growth in pipeline which represents 11.85% of the current pool balance. Class II-A from American Home Mortgage Investment Trust is placed on review because of the significant delinquencies (15.61%of current pool balance as of September was 60 days or more delinquent most of which was in foreclosure) which are likely to deplete the overcollateralization, and cause writedowns to Classes II-M-6, II- M-5, II-M-4, II-M-3, and II-M-2. At the other end of the credit spectrum, 41 securities are downgraded to Caa, Ca, and C ratings because the dramatically pool overall performance of closed-end second lien mortgages has already impaired or is expected to impair tranches at the bottom of the capital structures. Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class M-4, Downgraded to Ba2 from A1; - Series 2007-ASL1, Class M-5, Downgraded to B1 from A2; - Series 2007-ASL1, Class M-6, Downgraded to B3 from A3; - Series 2007-ASL1, Class M-7, Downgraded to C from Baa1; - Series 2007-ASL1, Class M-8, Downgraded to C from Baa2; - Series 2007-ASL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba3 from A3; - Series 2007-SL1, Class M-7, Downgraded to Ca from Baa1; - Series 2007-SL1, Class M-8, Downgraded to C from Baa2; - Series 2007-SL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-10, Downgraded to C from Ba1. Issuer: Alliance Bancorp Trust - Series 2007-S1, Class M-2, Downgraded to Baa3 from A2; - Series 2007-S1, Class M-3, Downgraded to B3 from Baa2. Issuer: American Home Mortgage Assets Trust 2007-3 - Class III-M-2, Downgraded to Ba3 from A3; - Class III-P-O, Downgraded to Caa2 from Ba1. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-M-1, Downgraded to Ba1 from Aa2; - Series 2007-A, Class II-M-2, Downgraded to Caa3 from A3; - Series 2007-A, Class II-M-3, Downgraded to C from Baa2; - Series 2007-A, Class II-M-4, Downgraded to C from Baa3; - Series 2007-A, Class II-M-5, Downgraded to C from Ba2. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-4, Downgraded to Baa2 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa3 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL1, Class B-2, Downgraded to C from Baa2; - Series 2007-SL1, Class B-3, Downgraded to C from Baa3; - Series 2007-SL1, Class B-4, Downgraded to C from Ba1; - Series 2007-SL2, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL2, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL2, Class M-6, Downgraded to B1 from A3; - Series 2007-SL2, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL2, Class B-2, Downgraded to C from Baa2; - Series 2007-SL2, Class B-3, Downgraded to C from Baa3. Issuer: Bear Stearns Second Lien trust - Series 2007-1, Class II-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class II-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class II-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class II-B-1, Downgraded to Caa1 from Baa3; - Series 2007-1, Class III-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class III-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class III-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class III-B-1, Downgraded to Caa1 from Baa3. - Series 2007-SV1, Class B-3, Downgraded to Ba3 from Baa3; - Series 2007-SV1, Class B-4, Downgraded to B1 from Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-SL1 - Class B-1, Downgraded to Ba1 from Baa1; - Class B-2, Downgraded to B2 from Baa2; - Class B-3, Downgraded to Caa1 from Baa3; - Class B-4, Downgraded to Ca from Ba1. Issuer: CSFB Home Equity Mortgage Trust - Series 2007-2, Cl. M-1, Downgraded to Baa2 from A3; - Series 2007-2, Cl. M-2, Downgraded to Baa3 from Baa1; - Series 2007-2, Cl. M-3, Downgraded to B1 from Baa2; - Series 2007-2, Cl. M-4, Downgraded to Caa3 from Baa3; - Series 2007-2, Cl. B-1, Downgraded to Ca from Ba1; - Series 2007-2, Cl. B-2, Downgraded to C from Ba2. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-4, Downgraded to Baa3 from A1; - Series 2007-FFA, Class M-5, Downgraded to B1 from A2; - Series 2007-FFA, Class M-6, Downgraded to B3 from A3; - Series 2007-FFA, Class B-1, Downgraded to Ca from Baa1; - Series 2007-FFA, Class B-2, Downgraded to C from Baa2; - Series 2007-FFA, Class B-3, Downgraded to C from Baa3; - Series 2007-FFA, Class B-4, Downgraded to C from Ba1; - Series 2007-FFC, Class B-3, Downgraded to B2 from Baa3; - Series 2007-FFC, Class B-4, Downgraded to B3 from Ba1. Issuer: Merrill Lynch Mortgage Loan Trust - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to B1 from Baa1; - Series 2007-SL1, Class B-2, Downgraded to B3 from Baa2; - Series 2007-SL1, Class B-3, Downgraded to Caa2 from Baa3. Issuer: Morgan Stanley Mortgage Loan Trust - Series 2007-4SL, Class B-3, Downgraded to Ba3 from Baa2; - Series 2007-4SL, Class B-4, Downgraded to Caa2 from Ba1; - Series 2007-4SL, Class B-5, Downgraded to C from Ba2. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-5, Downgraded to Baa3 from A1; - Series 2007-S1, Class M-6, Downgraded to B1 from A3; - Series 2007-S1, Class M-7, Downgraded to Caa1 from A3; - Series 2007-S1, Class M-8, Downgraded to C from Baa1; - Series 2007-S1, Class M-9, Downgraded to C from Baa3; - Series 2007-S1, Class M-10, Downgraded to C from Ba1. Issuer: SACO I Trust - Series 2007-1, Class M-5, Downgraded to Baa1 from A1; - Series 2007-1, Class M-6, Downgraded to Baa2 from A2; - Series 2007-1, Class B-1, Downgraded to Ba3 from Baa1; - Series 2007-1, Class B-2, Downgraded to Caa2 from Baa1; - Series 2007-1, Class B-3, Downgraded to C from Baa3; - Series 2007-1, Class B-4, Downgraded to C from Ba1; - Series 2007-2, Class M-4, Downgraded to Baa2 from A1; - Series 2007-2, Class M-5, Downgraded to Ba3 from A2; - Series 2007-2, Class M-6, Downgraded to B3 from A3; - Series 2007-2, Class B-1, Downgraded to C from Baa1. Review for Possible Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class A-1, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class A-2, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class M-1, current rating Aa1, on review for possible downgrade; - Series 2007-ASL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-ASL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-A, current rating Aaa, on review for possible downgrade. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL2, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL2, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-FFA, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-3, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-4, current rating Aa3, on review for possible downgrade. Issuer: SACO I Trust - Series 2007-1, Class M-4, current rating Aa3, on review for possible downgrade; - Series 2007-2, Class M-3, current rating Aa3, on review for possible downgrade. ALLTEL CORP: Fitch Lowers Issuer Default Rating to B from BB- ------------------------------------------------------------- Fitch Ratings has downgraded the ratings of Alltel Corporation and its subsidiaries, Alltel Communications Inc. and Alltel Ohio Limited Partnership, as follows in anticipation of the expected close on Nov. 16, 2007 of Alltel's leveraged buy-out transaction with TPG Capital and GS Capital Partners, a private equity affiliate of Goldman Sachs Group: Alltel Corp. -- Issuer Default Rating to 'B' from 'BB-'; -- $1.5 billion credit facility to 'CCC+/RR6' from 'BB-'; -- Senior unsecured debt to 'CCC+/RR6' from 'BB-'; ACI -- IDR to 'B' from 'BB-'. -- $39 million senior unsecured notes due 2008 to 'B/RR4' from 'BB-'; -- $53 million senior unsecured notes due 2009 to 'B/RR4' from 'BB-'; Alltel Ohio -- IDR to 'B' from BB-'; -- $297 million senior unsecured notes due 2010 'B/RR4' from 'BB-'. Fitch simultaneously removed Alltel's ratings from Rating Watch Negative. Once Alltel completes the tender offer for debt at its subsidiaries, Alltel Ohio and ACI, Fitch will withdraw all of the ratings at Alltel Ohio and the existing issue ratings at ACI. Fitch will also withdraw the ratings on the $1.5 billion bank credit facility at Alltel Corp. when the transaction closes. Fitch has assigned new ratings to the expected LBO transaction debt as: ACI -- $16.25 billion senior secured bank credit facility at 'BB/RR1'; -- $7.7 billion senior unsecured debt at 'B/RR4'. ACI will issue the new secured bank credit facility. ACI and Alltel Communications Finance will be co-issuers of the senior unsecured transaction debt. The Rating Outlook for all of Alltel's ratings is Stable. The 'B' IDR reflects Alltel's significantly higher leverage and debt service requirements following the close of the LBO, which greatly increases financial risk, limits financial flexibility and pressures free cash flow prospects over the rating horizon. The LBO transaction also increases Alltel's susceptibility to event risk. Offsets to these concerns include the strong operating trends in Alltel's wireless retail business, a historically strong operational management team and the expansive 850 MHz coverage in their tier two and three markets. Pro-forma debt, for the LBO closing, is expected to total approximately $24 billion with leverage of 7.9 times. The capital structure at ACI is likely to initially consist of the following debt instruments: -- $14 billion term loan B with three tranches due 2015; -- $1.5 billion senior secured revolving credit facility due 2013; -- $750 million delayed draw term loan B due 2015; -- $5.2 billion senior unsecured debt; -- $2.5 billion drawn on a senior unsecured paid-in-kind toggle bridge facility. Alltel has bank commitments in place that require the unsecured bridge facility to convert either into unsecured cash pay term loans or unsecured cash pay notes maturing in November 2015. Alltel also has bank commitments that require the PIK bridge facility to convert either into unsecured PIK notes or unsecured PIK term loans maturing in November 2017. Fitch expects to rate and assign recovery ratings to each of these debt securities once further clarity is known on issuance timing. All of the LBO debt securities receive support from guarantees of Alltel Corporation and each of its direct and indirect wholly owned domestic subsidiaries. Pro-forma liquidity, for the close of the LBO transaction, is expected to be adequate with approximately $565 million of cash and $1.5 billion available under an undrawn senior secured revolving credit facility maturing in 2013. In addition, Alltel could seek to monetize its tower portfolio, which Fitch estimates the value in excess of $1 billion. Amortization requirements for the term loan B will total $140 million on an annual basis. Expectations are for Alltel to generate minimal free cash flow in the first year following the close of the transaction. Fitch believes FCF levels will benefit going forward from reduced capital spending as a result of the completed deployment of its EV-DO wireless data footprint, the relative density and coverage of its wireless network and the increased scrutiny related to its capital plans. However, the increased financial risk as a result of the LBO debt does not leave Alltel much flexibility in the event FCF prospects are diminished from changes in the competitive environment or market conditions. Alltel has an added cushion in a stress scenario to defer some of its interest payments as a result of the $2.5 billion of PIK debt obligations as well as material leeway under its credit facility financial covenants. The senior secured leverage covenant is set at 6.75 times as of June 2008, reducing to 5.75x in 2012. At the end of 2007, Fitch estimates senior secured leverage of approximately 4.6x. Fitch expects Alltel will consider a material strategic investment in the Federal Communications Commission 700 MHz spectrum auction, which could further pressure credit metrics. While the company generally has sufficient spectrum capacity across all of its markets for growth associated with its existing voice and data subscribers, Fitch believes Alltel does not have adequate excess spectrum capacity that current technology standards require for a 4G network deployment. Consequently, 700 MHz spectrum could have significant longer-term strategic importance to Alltel and support the company's future negotiations with its roaming partners. Fitch does not believe Alltel would acquire 700 MHz spectrum for an edge-out strategy to its existing footprint. Terms associated with the credit facilities allow for a drawdown of $750 million from a delayed draw term loan B for 700 MHz spectrum purchases. There are no drawdown limitations for 700 MHz spectrum purchases associated with the unsecured revolving facility. The 'RR1' Recovery Rating for ACI's credit facility reflects Fitch's expectation of outstanding recovery prospects based on Alltel's enterprise value in a distress scenario. In deriving a distressed enterprise value, Fitch applies a discount to Alltel's estimated EBITDA, which includes a material reduction to their USF subsidy. The resulting EBITDA is approximately equivalent to an estimate of Alltel's total interest expense, maintenance capital spending and rent expense. The 'RR4' Recovery Rating for ACI's unsecured debt reflects average recovery prospects. The structural subordination of Alltel Corp.'s unsecured debt to the new LBO debt and lack of upstream guarantees results in a Recovery Rating of 'RR6'. ALTIUS IV: Moody's Places Ba1 Rating Under Negative Watch --------------------------------------------------------- Moody's Investors Service placed these notes issued by Altius IV Funding, Ltd. on review for possible downgrade: Class Description: U.S. $12,000,000 Class D Floating Rate Deferrable Notes Due 2042 -- Prior Rating: Baa2 -- Current Rating: Baa2, on review for possible downgrade Class Description: Up to U.S. $2,500,000 Class E Floating Rate Deferrable Notes Due 2042 -- Prior Rating: Ba1 -- Current Rating: Ba1, on review for possible downgrade According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. AMERICAN COLOR: Moody's Downgrades Corporate Family Rating to Ca ---------------------------------------------------------------- Moody's Investors Service has downgraded American Color Graphics, Inc. Corporate Family rating and Probability of Default rating, both to Ca from Caa2. The probability of default rating remains under review for possible further downgrade. Details of the rating action are as: Ratings lowered: -- $280 million senior secured second priority notes due 2010 to Ca, LGD4, 63% from Caa2, LGD4, 59% -- Corporate Family rating -- to Ca from Caa2 -- Probability of Default rating -- to Ca from Caa2 The rating outlook is stable, however the Probability of Default rating remains under review for possible downgrade. Approximately $280 million rated debt affected. The downgrade of the Corporate Family rating to Ca reflects Moody's concern regarding ACG's tight liquidity, weak asset coverage, high probability of default (even in the likely event that waivers are obtained from debt holders, which would be viewed as tantamount to a default), and questionable ability to operate as a going concern without a near-term restructuring event or sale of the company. The continuing review for possible downgrade of the PDR anticipates that the company will succeed in receiving required bondholder consent to the deferral of the Dec. 15, 2007 interest payment. Moody's expects to change the PDR to Ca/LD upon receipt of such requisite bondholder consent. On Nov. 6, 2007, ACG announced that it has commenced a consent solicitation requesting holders of its 10% Senior Second Secured Notes due 2010 to defer the semi-annual cash interest payment to March 15, 2008 from Dec. 15, 2007 and has sought an amendment and wavier from its lenders to provide for an additional $5 million term loan to ACG under its existing term loan and waive until February 15, 2008, any default under its bank credit facilities. American Color Graphics Inc., a leading provider of print and pre- media services, recorded sales of $441 million for the LTM period ended June 30, 2007. The company is based in Brentwood, Tennessee. AMERICAN HOME: Wants Removal of Actions Period Moved to March 4 --------------------------------------------------------------- American Home Mortgage Investment Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to extend the period within which they may remove various actions, which were pending in multiple state courts as of their bankruptcy filing, to March 4, 2008. The Debtors further ask that the Court's order approving the request be without prejudice to: -- any position the Debtors may take regarding whether Section 362 of the Bankruptcy Code applies to stay any given civil action pending against them; and -- the Debtors' right to seek further extensions of the period in which they may remove civil actions pursuant to Bankruptcy Rule 9027. Since the Petition Date, the Debtors have focused primarily on maximizing the value of their bankruptcy estates for the benefit of the stakeholders through the orderly liquidation of assets, James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, relates. To that end, the Debtors have solicited, negotiated and sought approval for several sales of various assets, including the Debtors' mortgage loan servicing business. Mr. Patton further relates that Chapter 11 imposes additional obligations on the Debtors to prepare schedules of assets and liabilities, produce monthly operating reports, respond to creditor inquiries, retain professionals and handle various tasks. As a result, the Debtors have not had an opportunity to fully investigate all of the State Court Actions to determine whether removal is appropriate. Accordingly, the Debtors seek an extension of the current November 5 deadline to protect their right to remove any of the State Court Actions. The Debtors submit that granting additional opportunity to consider the actions removal will assure that the Debtors' decisions are fully informed and consistent with the best interests of the estates. Mr. Patton points out that nothing in the request will prejudice any party to a proceeding that the Debtors may ultimately seek to remove from seeking the remand of the action under Section 1452(b) at the appropriate time. Judge Sontchi will convene a hearing on November 28, 2007, at 10:00 a.m., to consider the Debtors' request. Pursuant to Del.Bankr.LR 9006-2, the Debtors' Removal Period is automatically extended until the conclusion of that hearing. 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 Aug. 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 represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' 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. The Debtors' exclusive period to file a plan expires on Dec. 4, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: Court Sets January 11 as General Claims Bar Date --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has set Jan. 11, 2008, as the last day for any entity, other than governmental units, holding prepetition claims against American Home Mortgage Investment Corp. and its debtor-affiliates to file their proofs of claim. Governmental units have until Feb. 4, 2008, to file proofs of claim. Any entity holding a rejection damages claim arising from the rejection of an executory contract or unexpired lease, pursuant to an order entered prior to the confirmation of a plan of reorganization, will be required to file a proof of claim. The Rejection Bar Date will be the later of: (i) the General Bar Date; or (ii) 30 days after the Court approves the rejection of an executory contract or unexpired lease pursuant to which the entity asserting the Rejection Damages Claim is a party. Pursuant to the cash collateral order, the Court authorizes Bank of America, N.A., as administrative agent for prepetition secured parties, to file a single, master proof of claim on behalf of the Prepetition Secured Parties on account of their claims arising under certain loan documents against the Debtors. 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 Aug. 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 represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' 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. The Debtors' exclusive period to file a plan expires on Dec. 4, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: Court Extends Cash Collateral Access Until Nov. 15 ----------------------------------------------------------------- In an emergency request filed before the U.S. Bankruptcy Court for the District of Delaware, American Home Mortgage Investment Corp. and its debtor-affiliates obtained interim and final stipulated orders authorizing them to continue to use cash collateral in accordance with a certain revised budget through Nov. 15, 2007: American Home Mortgage Cash Budget -- Servicing Four Weeks Ending November 16, 2007 Opening Cash Balance $7,500,000 Sources of cash Servicing income 7,000,000 Other fee income 600,000 Investment income 1,600,000 LPMI receipts 3,200,000 Recovery -- HELOCs 1,600,000 Recovery -- P&I 13,700,000 Advance/Recovery -- Other (4,000,000) ----------- Total sources 23,700,000 Uses of cash Non-payroll and allocated costs 3,300,000 Payroll and payroll taxes 2,100,000 Retention payments 4,000,000 Health insurance - BCBS 600,000 LPMI reimbursed to corporate - P&I advances 1,000,000 Advances -- HELOCs 2,000,000 Other outflows - B of A expenses 1,100,000 Debt repayment/(funding) 7,000,000 ----------- Total uses 21,100,000 Net Cash Flow 2,600,000 ----------- Closing Balance $10,100,000 =========== The Debtors maintain that the continued use of the cash collateral will enable them to preserve the value of their loan servicing business by funding its day-to-day operating expenses, including payments to remaining employees. The Debtors note that unless they have continued use of the Cash Collateral, the value of the collateral, namely the Servicing Business as a going concern, will be seriously diminished. James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, claimed that if the request was denied, the Debtors will suffer immediate and irreparable harm, the Servicing Business operations will cease, and the operational value of the Servicing Business, which is significantly higher than its distressed liquidation value, will not be realized. In addition, the Debtors and Bank of America, N.A., administrative agent, agreed in a stipulation approved on an interim basis by Judge Sontchi, to amend certain terms of the final cash collateral order in connection with the Debtors' immediate need to obtain continued use of the Cash Collateral. Among the amendments purported by the First Interim Stipulation and Order are: -- the addition of a provision regarding the sale of the Debtors' loan servicing business; -- as additional adequate protection, and without prejudice to the right of any other party, the Debtors will pay indefeasibly in cash: * to the Administrative Agent for the ratable benefit of the prepetition secured lenders, in permanent reduction of the indebtedness all amounts on deposit in collateral agent, cash collateral and construction lock box accounts; * to the Administrative Agent for the benefit of the Prepetition Secured Parties, an amount equal to all incurred but unpaid customary fees and costs, and professional fees and expenses; and * on September 5, 2007, in permanent reduction of the Indebtedness, all Cash Collateral on hand in respect to the Servicing Business in excess of $10,000,000, and on October 5, 2007, all Cash Collateral in excess of $5,000,000; and -- the Debtors' use of the Collateral will terminate on November 16, 2007, among other termination events. A final hearing on the request has been set for Nov. 14, 2007, at 10:00 a.m. Objections are due today, November 9. 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 Aug. 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 represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' 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. The Debtors' exclusive period to file a plan expires on Dec. 4, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: Moody's Junks Ratings on Five Certificate Classes ---------------------------------------------------------------- Moody's Investors Service downgraded 88 classes of certificates and placed on review for possible downgrade 18 classes of certificates from 18 transactions issued in early 2007 and backed by closed-end second lien mortgage loans. A closed-end second lien mortgage loan is a loan secured by a second priority mortgage lien on residential real estate, and is advanced in a specified amount at the closing of the loan. When closed simultaneously with a first-lien mortgage loan to purchase a home, these loans are often known as 'piggyback loans'. The actions reflect the extremely poor performance of closed-end second lien mortgage loans securitized in early 2007. These loans have seen a high rate of early default and deals backed by those loans have been continuously building up significant pipeline. The performance closely tracks the performance of "piggyback loans' securitized in 2006 due to the aggressive underwriting guidelines combined with prolonged home price decline. Three Aaa-rated securities and 15 Aa-rated securities are placed under review for possible downgrade. Class A-1 and Class A-2 from ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASL1 have been placed on review due to the high cumulative loss (5.32% as of September) within 5 months of closing. The aggressive loan write-off didn't subdue the growth in pipeline which represents 11.85% of the current pool balance. Class II-A from American Home Mortgage Investment Trust is placed on review because of the significant delinquencies (15.61%of current pool balance as of September was 60 days or more delinquent most of which was in foreclosure) which are likely to deplete the overcollateralization, and cause writedowns to Classes II-M-6, II- M-5, II-M-4, II-M-3, and II-M-2. At the other end of the credit spectrum, 41 securities are downgraded to Caa, Ca, and C ratings because the dramatically pool overall performance of closed-end second lien mortgages has already impaired or is expected to impair tranches at the bottom of the capital structures. Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class M-4, Downgraded to Ba2 from A1; - Series 2007-ASL1, Class M-5, Downgraded to B1 from A2; - Series 2007-ASL1, Class M-6, Downgraded to B3 from A3; - Series 2007-ASL1, Class M-7, Downgraded to C from Baa1; - Series 2007-ASL1, Class M-8, Downgraded to C from Baa2; - Series 2007-ASL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba3 from A3; - Series 2007-SL1, Class M-7, Downgraded to Ca from Baa1; - Series 2007-SL1, Class M-8, Downgraded to C from Baa2; - Series 2007-SL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-10, Downgraded to C from Ba1. Issuer: Alliance Bancorp Trust - Series 2007-S1, Class M-2, Downgraded to Baa3 from A2; - Series 2007-S1, Class M-3, Downgraded to B3 from Baa2. Issuer: American Home Mortgage Assets Trust 2007-3 - Class III-M-2, Downgraded to Ba3 from A3; - Class III-P-O, Downgraded to Caa2 from Ba1. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-M-1, Downgraded to Ba1 from Aa2; - Series 2007-A, Class II-M-2, Downgraded to Caa3 from A3; - Series 2007-A, Class II-M-3, Downgraded to C from Baa2; - Series 2007-A, Class II-M-4, Downgraded to C from Baa3; - Series 2007-A, Class II-M-5, Downgraded to C from Ba2. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-4, Downgraded to Baa2 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa3 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL1, Class B-2, Downgraded to C from Baa2; - Series 2007-SL1, Class B-3, Downgraded to C from Baa3; - Series 2007-SL1, Class B-4, Downgraded to C from Ba1; - Series 2007-SL2, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL2, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL2, Class M-6, Downgraded to B1 from A3; - Series 2007-SL2, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL2, Class B-2, Downgraded to C from Baa2; - Series 2007-SL2, Class B-3, Downgraded to C from Baa3. Issuer: Bear Stearns Second Lien trust - Series 2007-1, Class II-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class II-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class II-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class II-B-1, Downgraded to Caa1 from Baa3; - Series 2007-1, Class III-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class III-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class III-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class III-B-1, Downgraded to Caa1 from Baa3. - Series 2007-SV1, Class B-3, Downgraded to Ba3 from Baa3; - Series 2007-SV1, Class B-4, Downgraded to B1 from Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-SL1 - Class B-1, Downgraded to Ba1 from Baa1; - Class B-2, Downgraded to B2 from Baa2; - Class B-3, Downgraded to Caa1 from Baa3; - Class B-4, Downgraded to Ca from Ba1. Issuer: CSFB Home Equity Mortgage Trust - Series 2007-2, Cl. M-1, Downgraded to Baa2 from A3; - Series 2007-2, Cl. M-2, Downgraded to Baa3 from Baa1; - Series 2007-2, Cl. M-3, Downgraded to B1 from Baa2; - Series 2007-2, Cl. M-4, Downgraded to Caa3 from Baa3; - Series 2007-2, Cl. B-1, Downgraded to Ca from Ba1; - Series 2007-2, Cl. B-2, Downgraded to C from Ba2. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-4, Downgraded to Baa3 from A1; - Series 2007-FFA, Class M-5, Downgraded to B1 from A2; - Series 2007-FFA, Class M-6, Downgraded to B3 from A3; - Series 2007-FFA, Class B-1, Downgraded to Ca from Baa1; - Series 2007-FFA, Class B-2, Downgraded to C from Baa2; - Series 2007-FFA, Class B-3, Downgraded to C from Baa3; - Series 2007-FFA, Class B-4, Downgraded to C from Ba1; - Series 2007-FFC, Class B-3, Downgraded to B2 from Baa3; - Series 2007-FFC, Class B-4, Downgraded to B3 from Ba1. Issuer: Merrill Lynch Mortgage Loan Trust - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to B1 from Baa1; - Series 2007-SL1, Class B-2, Downgraded to B3 from Baa2; - Series 2007-SL1, Class B-3, Downgraded to Caa2 from Baa3. Issuer: Morgan Stanley Mortgage Loan Trust - Series 2007-4SL, Class B-3, Downgraded to Ba3 from Baa2; - Series 2007-4SL, Class B-4, Downgraded to Caa2 from Ba1; - Series 2007-4SL, Class B-5, Downgraded to C from Ba2. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-5, Downgraded to Baa3 from A1; - Series 2007-S1, Class M-6, Downgraded to B1 from A3; - Series 2007-S1, Class M-7, Downgraded to Caa1 from A3; - Series 2007-S1, Class M-8, Downgraded to C from Baa1; - Series 2007-S1, Class M-9, Downgraded to C from Baa3; - Series 2007-S1, Class M-10, Downgraded to C from Ba1. Issuer: SACO I Trust - Series 2007-1, Class M-5, Downgraded to Baa1 from A1; - Series 2007-1, Class M-6, Downgraded to Baa2 from A2; - Series 2007-1, Class B-1, Downgraded to Ba3 from Baa1; - Series 2007-1, Class B-2, Downgraded to Caa2 from Baa1; - Series 2007-1, Class B-3, Downgraded to C from Baa3; - Series 2007-1, Class B-4, Downgraded to C from Ba1; - Series 2007-2, Class M-4, Downgraded to Baa2 from A1; - Series 2007-2, Class M-5, Downgraded to Ba3 from A2; - Series 2007-2, Class M-6, Downgraded to B3 from A3; - Series 2007-2, Class B-1, Downgraded to C from Baa1. Review for Possible Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class A-1, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class A-2, current rating Aaa, on review for possible downgrade; - Series 2007-ASL1, Class M-1, current rating Aa1, on review for possible downgrade; - Series 2007-ASL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-ASL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-A, current rating Aaa, on review for possible downgrade. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL1, Class M-3, current rating Aa3, on review for possible downgrade; - Series 2007-SL2, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-SL2, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-FFA, Class M-3, current rating Aa3, on review for possible downgrade. Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust - Series 2007-S1, Class M-2, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-3, current rating Aa2, on review for possible downgrade; - Series 2007-S1, Class M-4, current rating Aa3, on review for possible downgrade. Issuer: SACO I Trust - Series 2007-1, Class M-4, current rating Aa3, on review for possible downgrade; - Series 2007-2, Class M-3, current rating Aa3, on review for possible downgrade. ANDERSON MEZZANINE: Moody's Reviews Junk Ratings for Possible Cut ----------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade these notes issued by Anderson Mezzanine Funding 2007-1, Ltd.: Class Description: $130,000,000 Class A-1a Floating Rate Notes due July 2042 -- Prior Rating: Aaa -- Current Rating: Aa3, on review for possible downgrade Class Description: $53,000,000 Class A-1b Floating Rate Notes due July 2042 -- Prior Rating: Aaa -- Current Rating: Aa3, on review for possible downgrade Class Description: $30,500,000 Class A-2 Floating Rate Notes due July 2042 -- Prior Rating: Aaa -- Current Rating: Baa3, on review for possible downgrade Class Description: $42,700,000 Class B Floating Rate Notes due July 2042 -- Prior Rating: Aa2 -- Current Rating: Ba3, on review for possible downgrade Class Description: $16,775,000 Class C Deferrable Floating Rate Notes due July 2042 -- Prior Rating: A2 -- Current Rating: Caa2, on review for possible downgrade Class Description: $11,090,000 Class D Deferrable Floating Rate Notes due July 2042 -- Prior Rating: Baa2 -- Current Rating: Caa3, on review for possible downgrade According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. ARVINMERITOR INC: Closing North Carolina Operations in Sept. 2008 ----------------------------------------------------------------- ArvinMeritor Inc. will close its Commercial Vehicle Systems axle operation in Arden, North Carolina by September 2008. The closure is part of the restructuring actions in North America and Europe which the company expects to affect 13 plants and 2,800 employees, resulting in an estimated annual run rate savings of $130-$140 million by 2012. Operations based in Arden will be transferred to the company's facility in Forest City, North Carolina and to a plant in Monterrey, Mexico. The company intends to begin transferring work in February 2008. Fifty-six employees at the Arden facility were advised of the November 7 closure. Arden employees will transfer to the Fletcher, North Carolina facility. "ArvinMeritor is taking action to optimize its global manufacturing footprint which will enable us to better serve our customers while reducing our cost structure," Wayne Watson, general manager, operations, North America, said. About Arvinmeritor Headquartered in Troy, Michigan, ArvinMeritor Inc. (NYSE: ARM) -- http://www.arvinmeritor.com/-- supplies integrated systems, modules and components to the motor vehicle industry. The company serves light vehicle, commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets. ArvinMeritor employs about 19,000 people in 25 countries. * * * As reported in the Troubled Company Reporter on Oct. 9, 2007, Fitch Ratings downgraded its ratings on ArvinMeritor Inc. including Issuer Default Rating to 'BB-' from 'BB'; Senior secured revolver to 'BB' from 'BB+'; and Senior unsecured notes to 'B+' from 'BB-'. The rating outlook is negative. Standard & Poor's Ratings Services lowered its corporate credit rating and related ratings on ArvinMeritor Inc. to 'B+' from 'BB-'. The outlook is negative. Moody's Investors Service downgraded ArvinMeritor's Corporate Family Rating to B1 from Ba3 and maintained the outlook at stable. Moody's also lowered its ratings on the company's secured bank obligations (to Ba1, LGD-1, 8% from Baa3, LGD-2, 13%) and unsecured notes (to B2, LGD-4, 63% from B1, LGD-4, 63%). The Probability of Default is changed to B1 from Ba3, while the company's Speculative Grade Liquidity rating remains SGL-2. The outlook is stable. ASSEN DAIRY: Case Summary & 19 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Assen Dairy, LLC 8500 Yankeetown-Chenoweth Road London, OH 43140 Bankruptcy Case No.: 07-59038 Chapter 11 Petition Date: November 7, 2007 Court: Southern District of Ohio (Columbus) Judge: C. Kathryn Preston Debtor's Counsel: J. Matthew Fisher, Esq. Allen Kuehnle Stovall & Neuman LLP 21 West Broad Street, Suite 400 Columbus, OH 43215 Tel: (614) 221-8500 Fax: (614) 221-5988 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Pitstick Oakhill Farms Business Debt $245,000 15290 Prairie Pike South Solon, OH 43153 Site-n-Pipe EPA Silage Pond $75,111 P.O. Box 43 Marysville, OH 43040 Chappano Wood PLLC Legal Services $35,928 9th Floor 8 East Long Street Columbus, OH 43215-2925 Kalmbach Feeds of Indiana, Inc. Feed Mixes $35,489 Pieter Assen Premier Feeds Seeds and Fertilizer $32,899 Renaissance Nutrition Inc. Mineral Mixes $30,952 U.S. Department of Agriculture MILCX Subsidy $19,395 Premier Feeds Feeds $15,346 Cargill Malt Brewer's Grain $12,042 Vallery & Dorn Crop Insurance $11,947 North Point Engineering Corp. Engineering $10,632 Ohio Edison Utility - Electric $10,396 ABS Global, Inc. Breeding Services $10,324 Indiana Animal Health Medicine $9,300 Monsanto Company BST $8,014 Progressive Hoof Care Hoof Trimming Service $6,214 Feedercreek Veterinary Service Veterinary services $4,296 Farm Plan Tractor Repair $3,963 Hill's Supply Inc. Parlor Service $3,750 ATARI INC: June 30 Balance Sheet Upside-Down by $8.6 Million ------------------------------------------------------------ Atari Inc. disclosed Tuesday that it has filed its delayed quarterly report on Form 10-Q for the first quarter ended June 30, 2007. Atari anticipates that the filing of its Form 10-Q will bring it current in its periodic reporting obligations. As previously disclosed, the staff of Nasdaq notified Atari that its stock was subject to delisting because of its failure to comply with those requirements and granted Atari an extension to file its delayed Form 10-Q until Nov. 5, 2007. Atari notified the staff of Nasdaq of the need for an additional day and is awaiting their final determination. Atari Inc.'s consolidated balance sheet at June 30, 2007, showed $35.0 million in total assets and $43.6 million in total liabilities, resulting in an $8.6 million in total shareholders' The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $25.2 million in total current assets available to pay $34.1 million in total current liabilities. Net loss for the first quarter ended June 30, 2007, was $11.9 million, compared to net loss of $7.3 million in the year- earlier period. Net revenue for the first quarter ended June 30, 2007, was $10.4 million versus $19.5 million in the comparable year-earlier period. Publishing net revenue was $9.7 million, versus $9.8 million in the prior year, while distribution revenue was $687,000, versus $9.7 million in the comparable year-earlier period. Total distribution net revenues for the three months ended June 30, 2007 decreased by 93.0% from the prior comparable period due to the overall decrease in product sales of third party publishers as a result of management's decision to reduce the company's third party distribution operations in efforts to move away from lower margin products. 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?2517 Going Concern Doubt New York-based Deloitte & Touche LLP expressed substantial doubt about Atari'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 pointed to the company's significant operating losses. About Atari Inc. Headquartered in New York, Atari Incorporated, (NASDAQ: ATAR) - http://www.atari.com/ -- develops interactive games for all platforms and is a third-party publisher of interactive entertainment software in the U.S. Atari Inc. is a majority-owned subsidiary of France-based Infogrames Entertainment SA, an interactive games publisher in Europe. BALLY TECHNOLOGIES: Buying Compudigm's Gaming Power & seePOWER -------------------------------------------------------------- Bally Technologies Inc. has signed a contract to acquire the Gaming Power and seePOWER applications for the gaming industry from Compudigm International, adding exclusive and powerful data visualization and business analysis technology to the new Bally Business Intelligence product line. Compudigm's integrated solutions will immediately serve as a key component in Bally's server-gaming strategy and the company's plans for delivering "The Networked Floor Of The Future." The acquired Compudigm technology currently monitors, manages and optimizes data from more than 60,000 gaming positions around the world that generate $6 billion in annual revenues. Current customers using this product for marketing and business analysis include Harrah's Entertainment, Penn National Gaming, Trump Entertainment Resorts and the Seminole Tribe of Florida, well as major casinos in New Zealand and Australia. Bally also launched a comprehensive Business Intelligence solution that will consist of two distinct and integrated modules -- its internally developed Data Analysis Dashboard and Compudigm's Gaming Power and seePower Data Visualization modules -- both working off one combined Gaming Data Warehouse. This combination of two best-of-breed solutions will offer the most powerful and state-of-the-art business intelligence suite for the gaming industry. The Data Analysis Dashboard offers more than 650 predefined key performance indicators, graphical data analysis charts and graphs, more than 150 predefined reports and ad-hoc reporting that will bring all essential information required to manage a casino just a few computer clicks away. "The Compudigm technology acquisition is consistent with our commitment to deliver leading, yet useable technology with a strong return on investment to our Systems footprint of more than 368,000 devices worldwide," Richard Haddrill, CEO of Bally Technologies, said. "Our leading business intelligence suite of products will be a key component in delivering ROI on the evolving 'networked gaming floor of the future." The new Bally Business Intelligence product line will feature multiple pricing and scalable options for the different data warehousing, business analysis and data visualization solutions. "When combined with the acquired Compudigm technology, this will allow for dynamic decision-making that doesn't currently exist in the industry today and will be the most comprehensive business intelligence package in the gaming space," Bruce Rowe, senior vice president of Strategy and Business Development for Bally," said. "And it's the perfect foundational technology for both today's networked floor and for the potential created by server applications." The Compudigm Gaming Power technology specializes in connecting customer data with individual game data, providing game and marketing managers with deep insights into how casino patrons interact with the gaming floor. seePOWER transforms massive volumes of transaction and customer data, from any system, into critical, real-time visual insights from a physical perspective designed to prompt smarter, faster and more profitable decision- making. The Compudigm products Bally is acquiring transform the deluge of data generated by casino slots, tables and customer loyalty systems into actionable, visual insights that help casino managers make the smartest, fastest marketing and game floor management decisions possible. "The Bally solution will utilize seePOWER's smart marketing and predictive engine to unlock real value and to realize the full potential of a casino's business," Wout van Loon, CEO of Compudigm International, said. "The seePOWER platform has provided many gaming customers with an unparalleled competitive advantage." The Bally agreement represents Compudigm's business model to provide solution providers with the seePOWER platform and application development suite to deliver visualization, customer profiling, customer segmentation and content-intelligence to the entertainment, loyalty, financial services, retail, telecommunications, utilities and health sciences industries. About Compudigm International Headquartered in Las Vegas, Nevada, Compudigm International -- http://www.compudigm.com/-- delivers business intelligence solutions based upon its seePOWER data visualization technology, which enables enterprises to transform disparate data into actionable, visual intelligence for significant competitive advantage. Founded in 1997, the company enables enterprises to see their business clearly by animating, illustrating and infusing maps and floor-plans well as product, engineering and scientific diagrams with comprehensive business intelligence. Compudigm also delivers visualization, customer profiling, and content-intelligence as well as advice and guidance solutions to the gaming, retail, entertainment, telecommunications, utilities, health sciences and financial service industries. About Bally Technologies Inc. Headquartered in Las Vegas, Nevada, Bally Technologies Inc. (NYSE:BYI) - http://www.ballytech.com/-- is engaged in the design, manufacture, assembly and distribution of technology based products to commercial gaming markets. The company's business consists of two business units: the Bally Gaming and Systems business unit and the Rainbow Casino (Rainbow) business unit. The Bally Gaming and Systems unit consists of three primary sub- groups: Gaming Equipment, which includes the sale of gaming devices; Gaming Operations, which includes the rent and lease of gaming devices, and Systems, which includes the sale and support of gaming systems. It also owns and operates the Rainbow Casino in Vicksburg, Mississippi. * * * As reported in the Troubled Company Reporter on Nov. 7, 2007, Standard & Poor's Ratings Services raised its corporate credit and senior secured debt ratings on Las Vegas-based Bally Technologies Inc. to 'B+' from 'B-'. Concurrently, S&P revised the CreditWatch implications to positive from developing. BALLYROCK ABS: Moody's Cuts Rating on $26 Mil. Secured Notes to B3 ------------------------------------------------------------------ Moody's Investors Service announced today that it has placed the following notes issued by Ballyrock ABS CDO 2007-1 Limited on review for possible downgrade: Class Description: $150,000,000 Class A-1b Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $56,250,000 Class A-2 Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade In addition Moody's also downgraded and left on review for possible downgrade these notes: Class Description: $56,250,000 Class B Secured Floating Rate Notes Due 2047 -- Prior Rating: Aa2 -- Current Rating: A3, on review for possible downgrade Class Description: $27,500,000 Class C Secured Deferrable Floating Rate Notes Due 2047 -- Prior Rating: A2 -- Current Rating: Baa3, on review for possible downgrade Class Description: $26,250,000 Class D Mezzanine Secured Deferrable Floating Rate Notes Due 2047 -- Prior Rating: Baa2 -- Current Rating: B3, on review for possible downgrade According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of residential mortgage-backed securities. BARNERT HOSPITAL: Wants to Obtain $5 Mil. DIP Funding from HCFFA ---------------------------------------------------------------- Nathan and Miriam Barnert Memorial Hospital Association, dba Barnert Hospital, seeks permission from the U.S. Bankruptcy Court for the District of New Jersey to obtain debtor-in-possession financing from New Jersey Health Care Facilities Financing Authority. New Jersey Health has agreed to provide the Debtor with up to $5 million of revolving credit facility. Interest on the loan is 4.25% per annum. The proposed lending facility will be structured initially as a sub-limit for advances of up to a maximum of $2,500,000. The funds will be used to pay the Debtor's bankruptcy expenses. As adequate protection for NHC, the Debtor proposes to grant NHC a senior and priming lien on all of the Debtor's accounts and account related intangibles. Nathan and Miriam Barnert Memorial Hospital Association, dba Barnert Hospital, owns and operates a 256 bed general acute care community hospital located at 680 Broadway in Paterson, New Jersey. The company filed for chapter 11 protection on Aug. 15, 2007 (Bankr. D. N.J. Case No. 07-21631). David J. Adler, Esq., at McCarter & English, LLP, represents the Debtor in its restructuring efforts. Warren J. Martin Jr., Esq. and John S. Mairo, Esq., at Porzio Bromberg & Newman, P.C., represent the Official Committee of Unsecured Creditors in this case. Donlin Recano & Company Inc. is the Debtor's claims, noticing, and balloting agent. The Debtor's schedules reflect total assets of $46,600,967 and total liabilities of $61,303,505. BEAR STEARNS: Fitch Cuts Rating on Class II-B-4 Cert. to BB- ------------------------------------------------------------ Fitch has these action on Bear Stearns ALT-A Trust, mortgage pass- through certificates, series 2006-7 Group II as: -- Class A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 affirmed at 'BBB'; -- Class II-B-4 downgraded to 'BB-' from 'BB'; -- Class II-B-5 downgraded to 'C/DR4' from 'B'. The trust consists primarily of a pool of adjustable rate Alt-A type mortgage loans secured by first liens on one- to four-family residential properties. The affirmations are due to stable relationships between credit enhancement and future expected losses, and affect approximately $564.68 million in outstanding certificates. The negative rating actions are due to a deteriorating relationship between CE and future expected losses, and affect approximately $6.93 million in outstanding certificates. As of the October 2007 distribution period, the pool has approximately 4.30% of its collateral in the 60+ delinquency bucket (including Bankruptcy, Foreclosure, and Real Estate Owned) while the current CE for most subordinate Fitch rated class (II-B- 5) is 0.47%. The transaction has a pool factor (current collateral balance as a percentage of initial collateral balance) of approximately 83%, and is 12 months seasoned. BEAR STEARNS: Fitch Lowers Ratings on Three Certificate Classes --------------------------------------------------------------- Fitch Ratings has taken these rating actions on the Bear Stearns mortgage pass-through certificates listed below: BSABS 2006-AC2 Group 2 -- Class A affirmed at 'AAA'; -- Class 2-B-1 affirmed at 'AA'; -- Class 2-B-2 affirmed at 'A'; -- Class 2-B-3 downgraded to 'BBB-' from 'BBB'; -- Class 2-B-4 downgraded to 'B' from 'BB' and removed from Rating Watch Negative; -- Class 2-B-5 downgraded to 'C/DR5' from 'B' and removed from Rating Watch Negative. The collateral in the aforementioned transaction consists of fixed-rate, conventional mortgage loans secured by first liens on one- to four-family residential properties. The originator of the majority of the loans is American Home Mortgage, which comprised 76.73% of the pool's original balance. Fitch did not rate the Group 1 certificates. Wells Fargo Home Mortgage, Inc. is the servicer (rated 'RPS1' by Fitch). The affirmations reflect a stable relationship between credit enhancement and future expected losses, and affect approximately $172.11 million in outstanding certificates. The negative rating actions reflect deterioration in the relationship between CE and future expected losses, and affect approximately $6.37 million in outstanding certificates. As of the October 2007 remittance period, the pool factor is approximately 73%, and is 20 months seasoned. The cumulative loss as a percentage of original collateral balance is approximately 0.23%. The 60+ delinquency (inclusive of bankruptcy, foreclosure and REO) is 6.31%. BEAR STEARNS: Moody's Junks Ratings on Nine Certificate Classes --------------------------------------------------------------- Moody's Investors Service downgraded 88 classes of certificates and placed on review for possible downgrade 18 classes of certificates from 18 transactions issued in early 2007 and backed by closed-end second lien mortgage loans. A closed-end second lien mortgage loan is a loan secured by a second priority mortgage lien on residential real estate, and is advanced in a specified amount at the closing of the loan. When closed simultaneously with a first-lien mortgage loan to purchase a home, these loans are often known as 'piggyback loans'. The actions reflect the extremely poor performance of closed-end second lien mortgage loans securitized in early 2007. These loans have seen a high rate of early default and deals backed by those loans have been continuously building up significant pipeline. The performance closely tracks the performance of "piggyback loans' securitized in 2006 due to the aggressive underwriting guidelines combined with prolonged home price decline. Three Aaa-rated securities and 15 Aa-rated securities are placed under review for possible downgrade. Class A-1 and Class A-2 from ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASL1 have been placed on review due to the high cumulative loss (5.32% as of September) within 5 months of closing. The aggressive loan write-off didn't subdue the growth in pipeline which represents 11.85% of the current pool balance. Class II-A from American Home Mortgage Investment Trust is placed on review because of the significant delinquencies (15.61%of current pool balance as of September was 60 days or more delinquent most of which was in foreclosure) which are likely to deplete the overcollateralization, and cause writedowns to Classes II-M-6, II- M-5, II-M-4, II-M-3, and II-M-2. At the other end of the credit spectrum, 41 securities are downgraded to Caa, Ca, and C ratings because the dramatically pool overall performance of closed-end second lien mortgages has already impaired or is expected to impair tranches at the bottom of the capital structures. Downgrade Issuer: ACE Securities Corp. Home Equity Loan Trust - Series 2007-ASL1, Class M-4, Downgraded to Ba2 from A1; - Series 2007-ASL1, Class M-5, Downgraded to B1 from A2; - Series 2007-ASL1, Class M-6, Downgraded to B3 from A3; - Series 2007-ASL1, Class M-7, Downgraded to C from Baa1; - Series 2007-ASL1, Class M-8, Downgraded to C from Baa2; - Series 2007-ASL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba3 from A3; - Series 2007-SL1, Class M-7, Downgraded to Ca from Baa1; - Series 2007-SL1, Class M-8, Downgraded to C from Baa2; - Series 2007-SL1, Class M-9, Downgraded to C from Baa3; - Series 2007-SL1, Class M-10, Downgraded to C from Ba1. Issuer: Alliance Bancorp Trust - Series 2007-S1, Class M-2, Downgraded to Baa3 from A2; - Series 2007-S1, Class M-3, Downgraded to B3 from Baa2. Issuer: American Home Mortgage Assets Trust 2007-3 - Class III-M-2, Downgraded to Ba3 from A3; - Class III-P-O, Downgraded to Caa2 from Ba1. Issuer: American Home Mortgage Investment Trust - Series 2007-A, Class II-M-1, Downgraded to Ba1 from Aa2; - Series 2007-A, Class II-M-2, Downgraded to Caa3 from A3; - Series 2007-A, Class II-M-3, Downgraded to C from Baa2; - Series 2007-A, Class II-M-4, Downgraded to C from Baa3; - Series 2007-A, Class II-M-5, Downgraded to C from Ba2. Issuer: Bear Stearns Mortgage Funding Trust - Series 2007-SL1, Class M-4, Downgraded to Baa2 from A1; - Series 2007-SL1, Class M-5, Downgraded to Baa3 from A2; - Series 2007-SL1, Class M-6, Downgraded to Ba1 from A3; - Series 2007-SL1, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL1, Class B-2, Downgraded to C from Baa2; - Series 2007-SL1, Class B-3, Downgraded to C from Baa3; - Series 2007-SL1, Class B-4, Downgraded to C from Ba1; - Series 2007-SL2, Class M-4, Downgraded to Baa1 from A1; - Series 2007-SL2, Class M-5, Downgraded to Baa2 from A2; - Series 2007-SL2, Class M-6, Downgraded to B1 from A3; - Series 2007-SL2, Class B-1, Downgraded to Ca from Baa1; - Series 2007-SL2, Class B-2, Downgraded to C from Baa2; - Series 2007-SL2, Class B-3, Downgraded to C from Baa3. Issuer: Bear Stearns Second Lien trust - Series 2007-1, Class II-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class II-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class II-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class II-B-1, Downgraded to Caa1 from Baa3; - Series 2007-1, Class III-M-4, Downgraded to Baa2 from A3; - Series 2007-1, Class III-M-5, Downgraded to Ba1 from Baa1; - Series 2007-1, Class III-M-6, Downgraded to B2 from Baa2; - Series 2007-1, Class III-B-1, Downgraded to Caa1 from Baa3. - Series 2007-SV1, Class B-3, Downgraded to Ba3 from Baa3; - Series 2007-SV1, Class B-4, Downgraded to B1 from Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-SL1 - Class B-1, Downgraded to Ba1 from Baa1; - Class B-2, Downgraded to B2 from Baa2; - Class B-3, Downgraded to Caa1 from Baa3; - Class B-4, Downgraded to Ca from Ba1. Issuer: CSFB Home Equity Mortgage Trust - Series 2007-2, Cl. M-1, Downgraded to Baa2 from A3; - Series 2007-2, Cl. M-2, Downgraded to Baa3 from Baa1; - Series 2007-2, Cl. M-3, Downgraded to B1 from Baa2; - Series 2007-2, Cl. M-4, Downgraded to Caa3 from Baa3; - Series 2007-2, Cl. B-1, Downgraded to Ca from Ba1; - Series 2007-2, Cl. B-2, Downgraded to C from Ba2. Issuer: First Franklin Mortgage Loan Trust - Series 2007-FFA, Class M-4, Downgraded to Baa3 from A1; - Series 2007-FFA, Class M-5, Downgraded to B1 from A2; - Series 2007-FFA, Class M-6, Downgraded to B3 from A3; &nbs