T R O U B L E D C O M P A N Y R E P O R T E R Monday, November 12, 2007, Vol. 11, No. 268 Headlines ABFC TRUST: S&P Downgrades Ratings on 26 Certificate Classes ACCESS PHARMA: Arranges a $19.5 Million Recapitalization ALLTEL CORP: Increased Leverage Cues S&P to Cut Rating to B+ ALPHA MEZZ: Moody's Puts B1 Rating Under Review for Likely Cut ALTIUS III: Poor Credit Quality Cues Moody's to Review Ratings AMERIQUEST MORTGAGE: Delinquent Loans Cue Moody's to Junk Ratings AMP AA: Moody's Junks Note Ratings Due to Credit Quality Decline AMP AA: Poor Credit Quality Prompts Moody's to Junk Note Ratings AMP CDO: Moody's Downgrades Rating on $200 Million Notes to Ba1 APP PHARMACEUTICALS: Moody's Assigns Ba3 Corporate Family Rating APP PHARMACEUTICALS: High Debt Leverage Cues S&P's "BB" Rating ARCA 2006: Poor Credit Quality Cues Moody's to Junk Note Ratings ARCA FUNDING: Moody's Puts Six Junk-Rated Notes Under Neg. Watch ARINC INC: S&P Rates $575 Million Credit Facility at B+ ASSET SECURITIZATION: Loan Payoff Cues Fitch to Lift Ratings AVADO BRANDS: Selling All Assets Without Stalking Horse Bidder AVENTINE HILL: Moody's May Further Cut B2 Rating on $19.5MM Notes BANC OF AMERICA: Moody's Holds Ba3 Rating on $2 Mil. Certificates BARCLAYS CAPITAL: S&P Puts 'BB+' Rating Under Developing Watch BERNOULLI HIGH: Moody's Puts Ba3-Rated Notes Under Negative Review BI-LO LLC: S&P Holds 'B' Rating and Removes Developing Watch BLUE JAY: Moody's Rates Proposed Senior Credit Facility at B1 BOMBAY CO: Sells Headquarters to Goff Capital for $16.35 Million BON-TON STORES: Weak Sales Cue S&P to Lower Credit Rating to B BRANDYWINE REALTY: Inks $245.4 Million Deal with DRA Advisors BRISTOW GROUP: Prices $50 Mil. Offering of 7-1/2% Senior Notes BUCKINGHAM CDO: Moody's Cuts Rating on $13.5 Million Notes to Ba2 BUFFETS INC: Higher Default Risks Prompt Moody's to Junk Ratings CABLEVISION SYS: Sept. 30 Balance Sheet Upside-Down by $5.13 Bil. CAIRN MEZZ: Moody's Places Ba3-Rated Notes Under Negative Watch CALLIDUS DEBT: S&P Puts 'BB' Preliminary Rating on $25.5MM Notes CAPITAL AUTO: Fitch To Put BB Rating on $7.963MM Class D Trust CAPITAL AUTO: Moody's Rates $7,963,000 Class D Notes at (P)Ba1 CAPITAL AUTO: S&P Assigns 'BB' Prelim. Rating on $7.963MM Notes CAREEL BAY: Moody's May Further Cut Caa3 Rating on $10 Mil. Notes CARINA CDO: S&P Junks Ratings on 10 Certificate Classes CARMIKE CINEMAS: Moody's Holds B2 Corporate Family Rating CASH TECHNOLOGIES: Receives Noncompliance Notice from AMEX CENTRE SQUARE: Moody's Junks Rating on $30 Million Class E Notes CHARLES FORT: Moody's Places Caa3 Rating Under Negative Review CHARTER COMMS: Sept. 30 Balance Sheet Upside-Down by $7.334 Bil. CHRYSLER LLC: S&P Holds 'B' Rating and Removes Positive Watch CLASS V FUNDING: Moody's Junks Ratings on $90 Million Notes CLEAR CHANNEL: Earns $279.7 Million in 3rd Quarter Ended Sept. 30 CLEAR CHANNEL: Providence Mulls Rescinding $1.2 Billion Contract CLIFTON I: Moody's Places Caa3-Rated Notes Under Negative Review COMPASS DIVERSIFIED: Earns $4.4 Million in 3rd Qtr. Ended Sept. 30 COMPASS DIVERSIFIED: Moody's Assigns Ba3 Corporate Family Rating COMPASS MINERALS: Sept. 30 Balance Sheet Upside-Down by $769 Mil. CONNACHER OIL: Pod 1 Commissioning Cues S&P to Lift Rating COOKSON SERIES: Poor Credit Quality Cues Moody's Negative Action CORONA BOREALIS: Moody's Lowers Rating on $70 Million Notes to B1 DALTON CDO: Moody's Pares Rating on $18 Million Notes to Ba2 DEAN FOODS: Earns $6.5 Million in Third Quarter Ended Sept. 30 DELPHI CORP: Disclosure Statement Hearing Continued to Nov. 29 DIOGENES CDO: Moody's Junks Rating on $6.5 Million Class E Notes DUKE FUNDING: Moody's Puts Ba3-Rated Notes Under Negative Review DUNMORE HOMES: Files for Chapter 11 Protection in New York DUNMORE HOMES: Case Summary & 20 Largest Unsecured Creditors DURA AUTOMOTIVE: Court Approves $425 Million Exit Financing EMISPHERE TECH: Earns $3 Million in Quarter Ended September 30 FAB US: Poor Credit Quality Prompts Moody's Junk Note Ratings FEDERAL-MOGUL: Court Confirms Fourth Amended Reorganization Plan FIRST UNION: Credit Support Erosion Cues S&P to Lower Ratings FORD MOTOR: Post $380 Million Net Loss in 3rd Qtr. Ended Sept. 30 FREMONT GENERAL: Earns $18.3 Million in 3rd Quarter Ended Sept. 30 G-I HOLDINGS: Court OK's Appointment of Examiner to Probe Tersigni GEOKINETICS INC: Completes $25 Mil. Lease Facility with CIT Group GEORGIA GULF: Decline in PVC Unit Cues Moody's to Take Neg. Action GREEN TREE: S&P Puts Default Rating on Cl. B-1 Senior Certificates GSAMP TRUST: Moody's Junks Ratings on Four Certificate Classes GSR MORTGAGE: Moody's Puts Low-B Ratings on Two Cert. Classes HALCYON SECURITIZED: Moody's Rates Three Cert. Classes at Low-B HARRAH'S ENT: Indiana Gaming Commission Approves Apollo Buyout HOBOKEN WOOD: Opts to Liquidate Assets Under Chapter 7 HOBOKEN WOOD: Voluntary Chapter 7 Case Summary HOMBANC CORP: Wants Exclusive Plan Filing Period Moved to April 7 HOMEBANC CORP: Court Okays Drinker Biddle as Panel's Del. Counsel HOMEBANC CORP: Judge Carey Approves $61 Million Loan Sale to EMC HOUT BAY: Moody's Holds Low-B Ratings on $10 Million Notes HSPI DIVERSIFIED: Moody's Junks Rating on $6 Million Notes IMAC CDO: Bad Credit Quality Spurs Moody's Junk Note Rating IMAC CDO: Moody's May Further Cut Junk Rating on $20 Million Notes INGRAM MICRO: Board Approves $300 Million Repurchase of Shares INVERNESS MEDICAL: To Publicly Offer 7 Million of Common Stock INPHONIC INC: Files Ch. 11 Petition to Implement Versa Sale Deal INPHONIC INC: Case Summary & 20 Largest Unsecured Creditors ISCHUS MEZZANINE: Moody's Junks Ratings on $37.5 Million Notes IXION PLC: Moody's Junks 5 Note Ratings Over Poor Credit Quality JUPITER HIGH: Moody's Junks Ratings on Three Classes of Notes LAWRENCE SALANDER: Files for Bankruptcy in New York LAWRENCE SALANDER: Case Summary & 19 Largest Unsecured Creditors LB UBS: Moody's Lifts Rating on $3 Million Class T Certs. to Caa2 LEVITT & SONS: Files Chapter 11 Petition in Florida LEVITZ FURNITURE: Files for Chapter 11 Protection in New York LEVITZ FURNITURE: Case Summary & 20 Largest Unsecured Creditors LIBERTAS PREFERRED: Moody's Puts Ba3-Rated Notes Under Neg. Watch LONGPORT FUNDING: Moody's Junks Ratings on $38,250,000 Notes LOUISIANA LOCAL: Moody's Puts Ba3 Rating on $250 Million Bonds MARCAL PAPER: Wants Proposed Asset Sale Procedure Approved MARS CDO: Poor Loan Quality Prompts Moody's to Junk Note Ratings MARSICO PARENT: S&P Assigns 'B' Credit Rating with Stable Outlook MEDIACOM COMMS: S&P Places 'BB-' Rating Under Negative Watch MEZZANINE PORTFOLIO: Moody's Junks Rating on $7.5 Million Notes MOVIE GALLERY: Committee Opposes Debtors' Pact w/ Sopris Advisors MOVIE GALLERY: 8 Landlords Object to Lease Rejection Procedures MOVIE GALLERY: Landlords & Committee Object to $150MM DIP Loan MORGAN STANLEY: Moody's Holds Low-B Ratings on Five Cert. Classes NABI BIOPHARMA: Stockholders OK Sale of Assets for $185 Million NEO CDO: Moody's Junks Ratings on Three Certificate Classes NEW ENGLAND CENTER: Moody's Keeps Ba2 Rating on Long-Term Bonds NORDIC VALLEY: May Further Downgrade Low-B Ratings on Three Notes OCTONION I: Moody's Junks Ratings on Four Floating Rate Notes ORION 2006-2: S&P Retains Nine Ratings Under Negative Watch OXFORD INDUSTRIES: Board Approves $60 Million Stock Repurchase PAC-WEST TELECOMM: Plan Confirmation Hearing Deferred to Nov. 19 PAETEC HOLDING: Good Liquidity Cues Moody's to Assign SGL-2 Rating PAUL HOWARD: Case Summary & 19 Largest Unsecured Creditors PHH MORTGAGE: Fitch Rates $200,000 Class B-5 Certificates at B PINE MOUNTAIN: Moody's Places Low-B Ratings Under Negative Watch PLETTENBERG BAY: Moody's Junks Ratings on $19.5 Million Notes POTTSVILLE HOSPITAL: Weak Balance Sheet Cues S&P to Cut Rating PROGRESSIVE BAPTIST: Case Summary & 19 Largest Unsecured Creditors QUAKER FABRIC: Wants To Reject Unexpired Leases Under Gordon Pact QUEBECOR WORLD: Paying Preferred Shares Dividends on December 1 QUEBECOR WORLD: Posts $315 Mil. Net Loss in 2006 Third Quarter RASC SERIES: Moody's Puts Ratings On Neg. Watch Over Expected Loss RESMAE MORTGAGE: Moody's Puts Low-B Ratings on Two Cert. Classes RCN CORPORATION: Moody's Assigns B1 Rating on $200 Mil. Term Loan RIDGEWAY COURT: Moody's Cuts Ratings on Two Cert. Classes to Low-B ROCKBOUND CDO: Moody's Junks Ratings on $65MM Floating Rate Notes SALANDER-O'REILLY: Involuntary Chapter 7 Case Summary SEQUA CORP: Wants to Redeem 2008 Unsecured Notes by December 21 SEQUA CORPORATION: Earns $18,113,000 in Third Qtr. Ended Sept. 30 SEQUA CORPORATION: Moody's Rates Proposed Sr. Debt Facility at B1 SEQUA CORP: S&P Rates Proposed $1.35BB Secured Financing at BB- SHEFFIELD CDO: Moody's Pares Rating on $21.4 Million Notes to Ba3 SOLAR TRUST: Moody's Affirms Low-B Ratings on Four Cert. Classes SOLUTIA INC: Judge Beatty Approves $25 Million Backstop Deal SOTHEBY'S: Experts Link Low Art Sale Proceeds on Credit Crisis SPECTRUM BRANDS: Posts $333 Million Net Loss in Fourth Quarter STATION CASINOS: Completed Deal Prompts S&P to Lower Ratings STEVE PINKSTAFF: Case Summary & 17 Largest Unsecured Creditors STOCKTON CDO: Moody's May Further Cut Low-B Ratings on Four Notes STRUCTURED ASSET: Losses Cue Moody's to Take Neg. Rating Actions TASMAN CDO: Bad Loan Quality Cues Moody's to Junk Note Rating TAZLINA FUNDING: Moody's Junks Rating on $6 Million Class E Notes TEREX CORP: Moody's Holds Low-B Ratings on $1.1 Billion Notes THEATER XTREME: Closes Pennsylvania and Delaware Retail Stores THOMAS BAYLY: Case Summary & 19 Largest Unsecured Creditors TRENTON CONVALESCENT: Organizational Meeting Set for November 14 TRICADIA CDO: Moody's Junks Ratings on Three Certificate Classes UAL CORP: Issues 600,000+ Shares to Eligible Claimholders WACHOVIA BANK: Moody's Holds Ba1 Ratings on Three Cert. Classes WCI COMMUNITIES: Financial Woes Prompt Moody's to Junk Ratings WESTLAKE CHEMICAL: Moody's Rates $250 Mil. Revenue Bonds at Ba3 ZAIS INVESTMENT: Moody's Cuts Rating on $50 Million Notes to Ba1 * Fitch Completes Review of U.S. Subprime RMBS Transactions * Stephen Jones Joins Mesirow as Executive Vice President * BOND PRICING: For the Week of Nov. 5 - Nov. 9, 2007 ********* ABFC TRUST: S&P Downgrades Ratings on 26 Certificate Classes ------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings on 26 classes of asset-backed certificates from nine ABFC Trust series. At the same time, S&P placed its rating on one class on CreditWatch with negative implications. Concurrently, S&P affirmed its ratings on the remaining 76 classes from 15 ABFC Trust transactions issued between 2002 and 2004. The downgrades affect nine of the 15 transactions S&P reviewed: one of the four deals from the 2002 vintage; two of the three from the 2003 vintage; and six of the eight from the 2004 vintage. The downgraded classes reflect a high amount of severe delinquencies (90-plus days, foreclosures, and REOs) and a reduction in credit enhancement as a result of monthly realized losses. As of the October 2007 remittance period, severe delinquencies for series 2002-NC1 were 28.23% of the current pool balance, while losses outpaced excess interest by approximately 2.5x over the past six months. The downgraded 2003 and 2004 transactions had weighted average severe delinquencies of 10.43% and 13.52% of their current pool balances, respectively, and losses outpaced excess interest by an average of approximately 2.0x and 2.4x over the past six months. The overcollateralization target is 50 basis points for all transactions and is currently 22 bps below target for the downgraded 2002 transaction (series 2002-NC1), 16 bps and 17 bps below target for both downgraded 2003 transactions (series 2003- AHL1 and 2003-OPT1, respectively), and as high as 35 bps (series 2004-opt1) and as low as 7 bps (series 2004-ff1) below target for the downgraded 2004 transactions. The affirmations reflect sufficient credit enhancement levels to support the current ratings. The classes with affirmed ratings have actual and projected credit support percentages that are in line with their original levels. All ratings from transactions that did not experience downgrades (series 2002-OPT1, 2002-WF1, 2002-WF2, 2003-WMC2, 2004-OPT3, and 2004-OPT5) are currently at or above their original levels. The weighted average severe delinquencies for these transactions, as a percentage of the current pool balances, were 15.42% for the 2002 vintages, 10.43% for the 2003 vintages, and 12.48% for the 2004 vintages. Subordination, overcollateralization, and excess spread provide credit support for these transactions. Five of these series-- 2003-OPT1, 2004-OPT2, 2004-OPT3, 2004-OPT4, and 2004-OPT5--have mortgage insurance for a percentage of their loans. The insurance is issued by PMI Mortgage Insurance Co., which has a financial strength rating of 'AA/Watch Neg'. The collateral consists primarily of adjustable- and fixed-rate mortgage loans. Ratings Lowered ABFC Trust Asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2002-NC1 M-2 BBB A 2002-NC1 M-3 CCC BBB 2002-NC1 M-4 CCC BBB- 2003-AHL1 M-3 BBB+ AA 2003-AHL1 M-4 BB A 2003-AHL1 M-5 B BBB 2003-OPT1 M-5 BB BBB 2003-OPT1 M-6 B BBB- 2004-AHL1 M-6 BB- BBB- 2004-AHL1 M-7 B BB+ 2004-HE1 M-5 BB A 2004-HE1 M-6 B BBB+ 2004-HE1 M-7 B BBB+ 2004-HE1 M-8 CCC BBB 2004-OPT1 M-5 BB BBB 2004-OPT1 M-6 B BBB- 2004-OPT1 B CCC BB 2004-OPT4 M-5 BB BBB+ 2004-OPT4 M-6 B BBB 2004-OPT4 M-7 B- BBB 2004-FF1 M-4 BB BBB+ 2004-FF1 M-5 B BBB 2004-FF1 M-6 CCC BBB- 2004-FF1 M-7 CCC BBB- 2004-OPT2 M-6 BB BBB 2004-OPT2 B BB BBB- Rating Placed on Creditwatch Negative ABFC Trust Asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2004-FF1 M-3 A-/Watch Neg A- Ratings Affirmed ABFC Trust Asset-backed certificates Series Class Rating ------ ----- ------ 2002-OPT1 AIO-INV AAA 2002-OPT1 M-1 AA+ 2002-OPT1 M-2 AA- 2002-OPT1 M-3 A 2002-OPT1 M-4 BBB 2002-OPT1 M-5 BBB- 2002-NC1 M-1 AA+ 2002-WF1 M-1 AAA 2002-WF1 M-2 A 2002-WF1 M-3 BBB 2002-WF1 B BBB- 2002-WF2 A-2 AAA 2002-WF2 M-1 AA+ 2002-WF2 M-2 A 2002-WF2 M-3 BBB 2003-AHL1 AI, M-1, M-2 AAA 2003-OPT1 A-1, A-1A, A-3 AAA 2003-OPT1 M-1 AA+ 2003-OPT1 M-2 AA 2003-OPT1 M-3 A+ 2003-OPT1 M-4 A- 2003-WMC1 M-1 AA+ 2003-WMC1 M-2 A 2003-WMC1 M-3 A- 2003-WMC1 M-4 BBB+ 2003-WMC1 M-5 BBB 2003-WMC1 M-6 BBB- 2004-AHL1 M-1 AAA 2004-AHL1 M-2 AA 2004-AHL1 M-3 A+ 2004-AHL1 M-4 BBB+ 2004-AHL1 M-5 BBB 2004-HE1 M-1 AA+ 2004-HE1 M-2 AA 2004-HE1 M-3 AA- 2004-HE1 M-4 A+ 2004-OPT1 M-1 AA 2004-OPT1 M-2 A 2004-OPT1 M-3 A- 2004-OPT1 M-4 BBB+ 2004-OPT3 A-1, A-4 AAA 2004-OPT3 M-1 AA 2004-OPT3 M-2 A 2004-OPT3 M-3 A- 2004-OPT3 M-4 BBB+ 2004-OPT3 M-5 BBB 2004-OPT3 M-6 BBB- 2004-OPT4 A-1, A-2 AAA 2004-OPT4 M-1 AA 2004-OPT4 M-2 A+ 2004-OPT4 M-3 A 2004-OPT4 M-4 A- 2004-FF1 M-1 AA 2004-FF1 M-2 A 2004-OPT2 A-1, A-1A, A-2 AAA 2004-OPT2 M-1 AA 2004-OPT2 M-2 A+ 2004-OPT2 M-3 A 2004-OPT2 M-4 A- 2004-OPT2 M-5 BBB+ 2004-OPT5 A-1, A-4 AAA 2004-OPT5 M-1 AA+ 2004-OPT5 M-3 AA- 2004-OPT5 M-4 A 2004-OPT5 M-5 A- 2004-OPT5 M-6 BBB+ 2004-OPT5 M-7 BBB- ACCESS PHARMA: Arranges a $19.5 Million Recapitalization -------------------------------------------------------- Access Pharmaceuticals Inc. has executed arrangements for a $19.5 million recapitalization. The company has entered into agreements with institutional investors to purchase an aggregate of $9.5 million in gross proceeds of the company's newly issued Series A Convertible Preferred Stock. Lead investors in the placement transaction include SCO Capital Partners and Perceptive Life Sciences. In addition SCO Capital Partners, Oracle Partners and certain of their affiliates have agreed to exchange $10 million principal amount of senior debt into Series A Convertible Preferred Stock. "We are delighted to complete this placement to high-quality institutional investors," Stephen R. Seiler, Access' president and CEO, said. "The new capital will enable us to further a number of key objectives including pursuing and expanding our clinical trial program for Access' anti-cancer compound, ProLindac, a novel, proprietary DACH platinum which is in Phase 2 development." "The exchange of convertible debt for Series A Convertible Preferred Stock also allows us to achieve what was one of our major corporate goals for 2007, which is to simplify our capital structure and replace debt having a short-term maturity with permanent capital," Mr. Seiler added. Pursuant to the securities purchase agreements, the company will, subject to the completion of the closing, issue to the new investors Series A Convertible Preferred Stock initially convertible into 3,179,999 shares of the company's common stock. The investors will also receive warrants to purchase an additional 1,590,000 shares of the company's common stock at an exercise price of $3.50. In exchange for their outstanding $10 million principal amount of convertible notes presently convertible into 6,257,544 shares of common stock, the company will, after the closing, issue to SCO Capital Partners, Oracle Partners and certain of their affiliates, Series A Convertible Preferred Stock initially convertible into 6,792,877 shares of common stock. In addition, the current note holders will receive warrants to purchase 1,669,167 shares of common stock at an exercise price of $3.50. Closing of the transaction is subject to the fulfillment of customary and usual closing conditions. Rodman & Renshaw LLC, a wholly owned subsidiary of Rodman & Renshaw Capital Group Inc. acted as the exclusive placement agent for the transaction. About Access Pharmaceuticals Headquartered in Dallas, Texas, Access Pharmaceuticals Inc. (OTC BB: ACCP.OB) -- http://accesspharma.com/-- is an emerging biopharmaceutical company developing products for use in the treatment of cancer, the supportive care of cancer, and other disease states. The company's product for the management of oral mucositis, MuGard(TM) has received marketing clearance by the FDA as a device. The company's lead clinical development program for the drug candidate ProLindac(TM) is in Phase II clinical testing. Access also has advanced drug delivery technologies including Cobalamin(TM) mediated oral drug delivery and targeted delivery. Access Pharmaceuticals reported total assets of $3.6 million and total liabilities of $19.1 million at June 30, 2007, resulting in a $15.5 million total stockholders' deficit. Going Concern Doubt As reported in the Troubled Company Reporter on Sept. 13, 2007, Whitley Penn LLP, in Dallas, expressed substantial doubt about Access Pharmaceuticals Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's recurring losses from operations, net working capital deficiency and accumulated deficit. ALLTEL CORP: Increased Leverage Cues S&P to Cut Rating to B+ ------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings on Little Rock, Arkansas-based wireless carrier ALLTEL Corp., including its corporate credit rating, which was lowered to 'B+' from 'BB'. The ratings were removed from CreditWatch where they had been placed with negative implications since Feb. 23, 2007. The outlook is negative. "The downgrade is due to an expected substantial increase in the company's leverage to around 8x when its leveraged buyout is completed," said Standard & Poor's credit analyst Catherine Cosentino. At the same time, S&P assigned its 'BB-' rating and '2' recovery rating to a $16.25 billion senior secured credit facility being issued by intermediate holding company ALLTEL Communications Inc. The '2' recovery rating indicates S&P's expectation of substantial (70%-90%) recovery in the event of a payment default. S&P also assigned a 'B-' rating to ALLTEL Communications' proposed $2 billion of senior unsecured notes, and lowered the rating on the existing $2.3 billion of senior unsecured notes at ALLTEL Corp. to 'B-' from 'BB'. The rating on the subordinated notes at Western Wireless LLC was lowered as well to 'B-' from 'BB'. The unsecured and subordinated debt ratings are two notches below the corporate credit rating because of the substantial concentration of priority debt in the capital structure, primarily $14 billion of term loan B secured bank debt. Proceeds from the secured and unsecured debt issuances, together with planned draws on $5.7 billion of cash pay and paid-in-kind toggle senior unsecured bridge facilities, will be used to fund the company's buyout by sponsors TPG Capital and Goldman Sachs, as well as repurchase about $389 million in existing ALLTEL debt issues at ALLTEL Communications Inc. and ALLTELOhio L.P. The ratings on these existing issues were not lowered, and S&P will withdraw these ratings when the financing transactions are completed. S&P also did not lower the 'BB' rating on the company's $1.5 billion unsecured revolving credit facility, but will withdraw this rating upon completion of the transactions. However, S&P withdrew the 'A-2' short-term and commercial paper ratings on ALLTEL. Pro forma for the LBO, the company will have about $24 billion of total debt outstanding. The ratings on ALLTEL reflect the company's satisfactory business position, characterized by a stable to moderately growing subscriber and revenue base and a good market position in the wireless services sector. While company's leverage is high at around 8x, the favorable characteristics of its business support the rating. As a result of its very aggressive financial profile, the company is expected, at best, to generate very modest net free cash flow after capital expenditures in the next few years. In particular, capital expenditures for this business continue to be significant, at about $1 billion annually, to accommodate subscriber growth, improved network coverage and quality, and new data applications. Moreover, increases in postpaid churn and accelerated price competition from the national wireless carriers would further weaken the company's cash flow. ALLTEL is the largest regional wireless carrier in the U.S., with more than 12 million customers in 35 states. Its network covers nearly 80 million population equivalents. ALPHA MEZZ: Moody's Puts B1 Rating Under Review for Likely Cut -------------------------------------------------------------- Moody's Investors Service placed these notes issued by Alpha Mezz CDO 2007-I, Ltd. on review for possible downgrade: Class Description: $70,000,000 Class II Senior Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $30,000,000 Class III Senior Floating Rate Notes Due 2047 -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade Class Description: $5,000,000 Class IV Senior Floating Rate Notes Due 2047 -- Prior Rating: Aa3 -- Current Rating: Aa3, on review for possible downgrade In addition Moody's also downgraded and left on review for possible downgrade these notes: Class Description: $23,000,000 Class V Mezzanine Floating Rate Deferrable Notes Due 2047 -- Prior Rating: A2 -- Current Rating: Baa2, on review for possible downgrade Class Description: $22,500,000 Class VI Mezzanine Floating Rate Deferrable Notes Due 2047 -- Prior Rating: Baa2 -- Current Rating: Ba2, on review for possible downgrade Class Description: $7,000,00 Class VII Mezzanine Floating Rate Deferrable Notes Due 2047 -- Prior Rating: Ba1 -- Current Rating: B1, 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. ALTIUS III: Poor Credit Quality Cues Moody's to Review Ratings -------------------------------------------------------------- Moody's Investors Service placed these notes issued by Altius III Funding, Ltd. on review for possible downgrade: Class Description: $88,000,000 Class B Floating Rate Notes Due 2041 -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade Class Description: $23,000,000 Class C Floating Rate Deferrable Notes Due 2041 -- Prior Rating: A2 -- Current Rating: A2, on review for possible downgrade Class Description: $19,000,000 Class D Floating Rate Deferrable Notes Due 2041 -- Prior Rating: Baa2 -- Current Rating: Baa2, on review for possible downgrade Class Description: $6,000,000 Class E Floating Rate Deferrable Notes Due 2041 -- 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. AMERIQUEST MORTGAGE: Delinquent Loans Cue Moody's to Junk Ratings ----------------------------------------------------------------- Moody's downgrades ratings of 16 tranches of RMBS backed by scratch and dent collateral issued by Ameriquest Mortgage Securities, Inc. Moody's Investors Service has downgraded the ratings of 16 tranches issued in four separate Ameriquest Mortgage Securities, Inc. mortgage transactions. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. Each deal being reviewed has experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses. Downgrades for the 2004-X1 transaction have resulted from a significant slowdown of prepayment speeds and the rapid pace of losses resulting from a higher than anticipated delinquency pipeline build-up and higher severities of losses upon liquidation of small balance mortgage collateral. Complete rating actions are: Issuer: Ameriquest Mortgage Securities Inc., Quest Trust 2004-X1 -- Cl. M-1; Downgraded from A2 to Ba2 -- Cl. M-2; Downgraded from Ba3 to Caa2 -- Cl. M-3; Downgraded from B3 to C -- Cl. M-4; Downgraded from Caa3 to C Issuer: Ameriquest Mortgage Securities Inc., Quest Trust 2004-X2 -- Cl. M-4; Downgraded from Baa2 to Ba3 -- Cl. M-5; Downgraded from Baa3 to B3 Issuer: Ameriquest Mortgage Securities Inc., Quest Trust 2004-X3 -- Cl. M-4; Downgraded from Baa2 to Ba3 -- Cl. M-5; Downgraded from Baa3 to Caa1 -- Cl. M-6; Downgraded from Ba2 to Caa3 -- Cl. M-7; Downgraded from B1 to C Issuer: Ameriquest Mortgage Securities Inc., Quest Trust 2005-X2 -- Cl. M-1; Downgraded from A2 to Baa2 -- Cl. M-2; Downgraded from A3 to Baa3 -- Cl. M-3; Downgraded from Baa1 to Ba2 -- Cl. M-4; Downgraded from Baa2 to B1 -- Cl. M-5; Downgraded from Baa3 to B3 -- Cl. M-6; Downgraded from Ba1 to Caa1 AMP AA: Moody's Junks Note Ratings Due to Credit Quality Decline ---------------------------------------------------------------- Moody's Investors Service downgraded these notes issued by AMP AA CDO 2.5-4.5 Notes: Class Description: $16,000,000 AMP AA CDO 2.5-4.5 Notes -- Prior Rating: A1 -- Current Rating: Ca According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. AMP AA: Poor Credit Quality Prompts Moody's to Junk Note Ratings ---------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade these notes issued by AMP AA CDO 4.5-9.0 Notes: Class Description: $9,000,000 AMP AA CDO 4.5-9.0 Notes -- Prior Rating: Aa2 -- Current Rating: Caa3, on review for possible downgrade According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. AMP CDO: Moody's Downgrades Rating on $200 Million Notes to Ba1 --------------------------------------------------------------- Moody's Investors Service placed these notes issued by AMP CDO 2006-1 on review for possible downgrade: Class Description: $200,000,000 Variable Notes due 2053 -- Prior Rating: Aa3 -- 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. APP PHARMACEUTICALS: Moody's Assigns Ba3 Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service assigned a Ba3 Corporate Family Rating to APP Pharmaceuticals, LLC, a subsidiary of APP Pharmaceuticals, Inc. Moody's also assigned a Ba3 rating to APP's proposed offering of $1.15 billion of senior secured credit facilities, consisting of a $150 million revolving credit facility and $1.0 billion of term loans. In addition, Moody's assigned a Speculative Grade Liquidity rating of SGL-2, reflecting Moody's belief that the company will have good liquidity for the twelve months ending December 2008. The outlook for the ratings is stable. This is the first time Moody's has assigned ratings to APP. The rated debt is approximately $1.2 billion. The ratings are constrained by the increase in financial leverage and deterioration of credit metrics resulting from the incremental debt. In addition, Moody's believes there is event risk associated with the complex and highly regulated manufacturing and supply processes in the injectable pharmaceutical industry. In the past the company has experienced events of this nature including a voluntary plant shut-down in 2005 in order to upgrade and re-validate a manufacturing facility and constraints on the availability of certain products. The ratings are also constrained by the limited scale of the company. However, the ratings are supported by Moody's expectation for improvement in credit metrics over the next twelve to eighteen months resulting from debt repayment, the launch of new products from a strong pipeline, and favorable industry fundamentals. In addition, APP benefits from very high barriers to entry in the injectable, generic pharmaceutical industry and has demonstrated a track record of competing successfully with larger pharmaceutical companies. Moody's also believes that infrastructure investments in recent years should support increased manufacturing capacity and could reduce the likelihood of a manufacturing or supply event. All ratings are subject to review of final documentation. Ratings assigned are: APP Pharmaceuticals: -- $150 million senior secured revolving credit facility due 2012; Ba3, LGD3, 34% -- $500 million senior secured Tranche A term loan due 2013; Ba3, LGD3, 34% -- $500 million senior secured Tranche B term loan due 2013; Ba3, LGD3, 34% -- Corporate Family Rating; Ba3 -- Probability of Default Rating; B1 -- Speculative Grade Liquidity Rating; SGL-2 The outlook for the ratings is stable. APP will be a newly formed entity resulting from the separation of Abraxis BioScience Inc. (NASDAQ: ABBI) into two independent, publicly traded companies. APP is a leading developer, manufacturer and supplier of injectable generic pharmaceuticals used primarily in hospitals, long-term care facilities and clinics within North America. The company supplies injectable drugs in four main therapeutic categories, including oncology, anti- infective, critical care and anesthesia/analgesic. APP PHARMACEUTICALS: High Debt Leverage Cues S&P's "BB" Rating -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' corporate credit rating to Schaumburg, Illinois-based generic drug maker APP Pharmaceuticals Inc. The outlook is stable. At the same time, S&P assigned its bank loan and recovery ratings to APP's $1.15 billion proposed financing, comprising a $500 million term loan A and $500 million term loan B, both due 2013, and a $150 million revolving credit facility due 2012. The senior secured credit facilities are rated 'BB+', with a recovery rating of '2', indicating the expectation for substantial (70%-90%) recovery in the event of a payment default. "The ratings on APP reflect the company's high debt leverage and niche position in the generic drug industry," said Standard & Poor's credit analyst Arthur Wong. "These factors are offset partially by the company's solid industry position, well-stocked product pipeline, and expected steady deleveraging over the intermediate term." APP is the injectable generic drug business of Abraxis Bioscience, which is spinning off its proprietary biotechnology business into a separate, publicly traded company. APP will use the proceeds of the debt offering to repay existing Abraxis debt and capitalize Abraxis' spun-off biotechnology business. ARCA 2006: Poor Credit Quality Cues Moody's to Junk Note Ratings ---------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade these notes issued by Arca 2006-II, Ltd: Class Description: $70,000,000 Class II Funded Senior Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Baa3, on review for possible downgrade Class Description: $56,000,000 Class III Funded Senior Notes Due 2047 -- Prior Rating: Aa2 -- Current Rating: Ba1, on review for possible downgrade Class Description: $28,500,000 Class IV-A Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: A2 -- Current Rating: B1, on review for possible downgrade Class Description: $11,000,000 Class IV-B Funded Mezzanine Variable Notes Due 2047 -- Prior Rating: A2 -- Current Rating: B1, on review for possible downgrade Class Description: $36,500,000 Class V Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: Baa2 -- Current Rating: Caa2, on review for possible downgrade Class Description: $7,000,000 Class VI Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: Baa3 -- Current Rating: Caa3, on review for possible downgrade In addition, Moody's also downgraded these notes: Class Description: $10,000,000 Class VII Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: Ba1 -- Current Rating: Ca According to Moody's, the rating actions are the results of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. ARCA FUNDING: Moody's Puts Six Junk-Rated Notes Under Neg. Watch ---------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade these notes issued by Arca Funding 2006-I, Ltd: Class Description: $99,500,000 Class II Funded Senior Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba1, on review for possible downgrade Class Description: $59,500,000 Class III Funded Senior Notes Due 2046 -- Prior Rating: Aa2, on review for possible downgrade -- Current Rating: Caa1, on review for possible downgrade Class Description: $17,000,000 Class IV Funded Senior Notes Due 2046 -- Prior Rating: A3 -- Current Rating: Caa3, on review for possible downgrade In addition, Moody's also downgraded these notes: Class Description: $17,000,000 Class V Funded Mezzanine Notes Due 2046 -- Prior Rating: Baa3 -- Current Rating: Ca Class Description: $17,000,000 Class VI Funded Mezzanine Notes Due 2046 -- Prior Rating: Ba2 -- Current Rating: Ca Class Description: $7,000,000 Class VII Funded Mezzanine Notes Due 2046 -- Prior Rating: Ba3 -- Current Rating: Ca Class Description: $7,000,000 Class VIII Funded Mezzanine Notes Due 2046 -- Prior Rating: Caa1 -- Current Rating: Ca According to Moody's, the rating actions are the results of deterioration in the credit quality of the transaction's underlying collateral pool, which consists primarily of structured finance securities. ARINC INC: S&P Rates $575 Million Credit Facility at B+ ------------------------------------------------------- Standard & Poor's Ratings Services assigned bank loan and recovery ratings to ARINC Inc.'s $770 million secured credit facility. The $575 million first-lien credit facility is assigned a 'B+' rating and '2' recovery rating, indicating expectations of substantial (70%-90%) recovery of principal in the event of payment default. The $195 million second-lien credit facility is assigned a 'CCC+' rating and '6' recovery rating, indication expectations of negligible (0%-10%) recovery. The proceeds from the credit facilities were used to partially finance the acquisition of the company by the Carlyle Group. See the recovery report, "ARINC Inc.'s $770 Million Bank Financing," to be published on RatingsDirect immediately following release of this article, for the full recovery analysis. Annapolis, Maryland-based ARINC (B/Stable/--) is a leading provider of engineering services to the U.S. military and other government agencies (59% of 2006 revenues), mission-critical communications and IT services to the global aviation industry (24%), and communications and information systems for airports and surface transportation systems (17%). The corporate credit rating on ARINC is 'B' and the outlook is stable. "The rating reflects its weak credit protection measures as a result of very high debt leverage following the acquisition by Carlyle, which more than offset the company's leading position in niche markets and adequate profitability and liquidity," said Standard & Poor's credit analyst Christopher DeNicolo. Ratings List ARINC Inc. Corporate Credit Rating B/Stable/-- Ratings Assigned $575 Mil. 1st-Lien Credit Facility B+ Recovery Rating 2 $195 Mil. 2nd-Lien Credit Facility CCC+ Recovery Rating 6 ASSET SECURITIZATION: Loan Payoff Cues Fitch to Lift Ratings ------------------------------------------------------------ Fitch upgrades these classes of Asset Securitization Corporation's commercial mortgage pass-through certificates, series 1996-MD VI: -- $56.0 million class A-7 to 'AAA' from 'A+'; -- $35.8 million class B-1 to 'AAA from 'BB'; -- $1,000 class B-1H to 'AAA from 'BB'. Classes A-4, A-5, and A-6 have been paid in full. Classes A-1C, interest only class CS-3, A-2 and A-3 are not rated by Fitch. The upgrades are due to the October 2007 payoff of two loans, MHP Portfolio and Palmer Square. One defeased loan remains in the pool: The Columbia Sussex. The security is scheduled to mature on August 11, 2016, but has an optional prepayment date of August 11, 2011. AVADO BRANDS: Selling All Assets Without Stalking Horse Bidder -------------------------------------------------------------- Avado Brands Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware for authority to sell substantially all of their assets free and clear of all liens and interests. The Debtors disclose that they are selling their assets without a stalking horse bidder, however, 14 bidders have qualified as potential buyers as of Nov. 7, 2007. The aggregate purchase price for the assets is yet to be determined. To participate in the auction, bids must be accompanied by a cash deposit up to 5% more than the value of the bid; provided that the Debtors' DIP lender, DDJ Capital Management LLC, is not required to post any cash deposit in order to qualify to purchase the assets. In addition, DDJ Capital is entitled to a credit bid of its entire secured claim up to approximately $51.5 million pursuant to Section 363(k) of the Bankruptcy Code. However, the Court has yet to confirm approval of DDJ Capital's credit bid right. On Oct. 16, 2007, the Court approved the Debtors' proposed bidding procedure regarding the sale of their assets. The Debtors have proposed an auction to be held on Nov. 14, 2007. A hearing to consider approval of the sale of the Debtors' assets is scheduled to be held on Nov. 20, 2007, at 11:30 a.m, 824 Market Street, 5th Floor, Courtroom 4 in Wilmington, Delaware. The Debtors said that Lane Berry & Co. International LLC, as financial advisors, will assist them to market and sell all of their assets. About Avado Brands Madison, Georgia-based Avado Brands Inc., aka Applesouth, -- http://www.avado.com/-- operates about 120 casual dining restaurants under the banners Don Pablo's Mexican Kitchen and Hops Grillhouse & Brewery. The restaurants are located in 22 states in the U.S. As of Sept. 5, 2007, the Debtors employed about 9,970 people. For the year ended July 31, 2007, the Debtors generated about $227.8 million in revenues and a negative EBITDA of $7.8 million. The Debtor filed for chapter 11 protection on Feb. 4, 2004 (Bankr. N.D. Tex. Case No. 04-1555). On April 26, 2005, Judge Steven Felsenthal confirmed Avado's Modified Plan of Reorganization and that Plan became effective on May 19, 2005. On Sept. 5, 2007, Avado filed a voluntary chapter 22 petition (Bankr. D. Del. Case No. 07-11276) to complete an orderly sale of its assets, via Section 363 of the Bankruptcy Code. About 10 of Avado's affiliates also filed for bankruptcy protection on the same date (Bankr. D. Del. Case Nos. 07-11277 through 07-11286). Michael Tuchin, Esq., and Stacia A. Neeley, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, represent the Debtors. Donald J. Detweiler, Esq., at Greenberg Traurig, LLP, is the Debtors' local counsel. Kurtzman Carson Consultants LLC acts as the Debtors claims and noticing agent. In their second filing, the Debtors disclosed estimated assets and debts between $1 million to $100 million. Scott L Hazan, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and David B. Stratton, Esq., at Pepper Hamilton LLP, represent the Official Committee of Unsecured Creditors. AVENTINE HILL: Moody's May Further Cut B2 Rating on $19.5MM Notes ----------------------------------------------------------------- Moody's Investors Service placed these notes issued by Aventine Hill CDO I, Ltd. on review for possible downgrade: Class Description: $414,000,000 Class A1S Variable Funding Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $111,000,000 Class A1J Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $12,375,000 Class I Subordinated Notes Due 2047 -- Prior Rating: Ba3 -- Current Rating: Ba3, on review for possible downgrade In addition Moody's also downgraded and left on review for possible downgrade these notes: Class Description: $96,750,000 Class A2 Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aa2 -- Current Rating: A2, on review for possible downgrade Class Description: $39,000,000 Class A3 Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: A2 -- Current Rating: Baa3, on review for possible downgrade Class Description: $28,500,000 Class B1 Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: Baa2 -- Current Rating: Ba3, on review for possible downgrade Class Description: $19,500,000 Class B2 Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: Baa3 -- Current Rating: B2, 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. BANC OF AMERICA: Moody's Holds Ba3 Rating on $2 Mil. Certificates ----------------------------------------------------------------- Moody's Investors Service upgraded the ratings of eight classes and affirmed the ratings of nine classes of Banc of America Large Loan, Inc., Commercial Mortgage Pass-Through Certificates, Series 2006-BIX1 as: -- Class A-1, $68,257,627, Floating, affirmed at Aaa -- Class A-2, $223,462,130, Floating, affirmed at Aaa -- Class X-1A, Notional, affirmed at Aaa -- Class X-1B, Notional, affirmed at Aaa -- Class X-2, Notional, affirmed at Aaa -- Class X-3, Notional, affirmed at Aaa -- Class X-4, Notional, affirmed at Aaa -- Class X-5, Notional, affirmed at Aaa -- Class B, $15,035,235, Floating, upgraded to Aaa from Aa1 -- Class C, $43,214,117, Floating, upgraded to Aaa from Aa2 -- Class J-CP, $4,285,492, Floating, upgraded to A1 from Baa1 -- Class K-CP, $6,353,866, Floating, upgraded to A2 from Baa2 -- Class L-CP, $12,459,759, Floating, upgraded to Baa1 from Baa3 -- Class J-CA, $1,374,209, Floating, upgraded to A1 from Baa1 -- Class K-CA, $941,439, Floating, upgraded to A2 from Baa2 -- Class L-CA, $1,094,685, Floating, upgraded to A3 from Baa3 -- Class M-MC, $2,000,000, Floating, affirmed at Ba3 Approximately $378.5 million of structured securities are affected. The Certificates are collateralized by three whole loans and 11 senior participation interests secured by 58 properties. The loans range in size from 1.7%to 34.2% of the pool based on current principal balances. As of the October 15, 2007 distribution date, the transaction's aggregate certificate balance has decreased by approximately 53.5% to $576.0 million from $1.2 billion at securitization as the result of the payoff of four loans, partial property releases associated with three loans and amortization associated with three loans. Classes A-1, A-2, B and C are pooled classes which benefit from pool diversity, while classes non- pooled Classes J-CP, K-CP, L-CP, J-CA, K-CA, L-CA and M-MC depend on the performance of the CarrAmerica - Pool 3 National Portfolio Loan, the CarrAmerica - Pool 2 Portfolio Loan and the 770 M Street Loan respectively for debt service and ultimate repayment. Moody's current weighted average loan to value ratio ("LTV") is 68.2%, compared to 72.3% at securitization. Moody's is upgrading Classes B and C due to increased credit support. Classes J-CP, K- CP, L-CP, J-CA, K-CA and L-CA have been upgraded due to decreased leverage from property releases. The CarrAmerica - Pool 3 National Portfolio Loan ($196.7 million - - 34.2%) represents the 40.0% portion of a $491.8 million pari passu loan. There is also a $202.0 million non-trust junior secured loan and a $217.9 million mezzanine loan. The loan is secured by 37 office properties located in eight major office markets located in six states. The portfolio contains approximately 12.4 million square feet, of which 7.2 million square feet represents the loan sponsor's wholly-owned interests and its percentage ownership interests in joint venture properties. At securitization the portfolio contained 19.4 million square feet, of which 13.9 million square feet was collateral for the loan. The outstanding pool balance has decreased by 68.7% since securitization due to property releases and the related release premiums. A portion of the debt (allocated to 15 properties) is not secured by real estate but is secured by a pledge of an assignment of cash flow, refinance and sale proceeds. These properties represent 59.5% of the total net rentable area and 18.4% of the allocated loan balance. As of June 2007 the portfolio had a weighted average occupancy of 84.9%, compared to 89.1% at securitization for the original portfolio and 87.8% for the current portfolio. At securitization the Blackstone Group, the loan sponsor provided a guaranty to expend $88.5 million on capital improvements, tenant improvements and leasing commissions. Moody's LTV is 64.8%, compared to 74.7% at securitization. Moody's current shadow rating is A1, compared to A3 at securitization. The Greece Ridge Center Loan ($72.0 million - 12.5%) is secured by 872,198 square feet of space of a 1.6 million square foot regional mall located in Greece, New York. The mall is shadow anchored by J.C. Penney (Moody's senior unsecured rating Baa3; stable outlook), The Bon-Ton (Moody's senior unsecured rating B3; stable outlook), Sears and Kaufmann's (parent Macy's Inc. - Moody's senior unsecured shelf rating (P)Baa2; stable outlook). As of April 2007 occupancy was 87.2%, compared to 88% at securitization. Vacancy includes the second floor of the former Montgomery Ward space that is considered functionally obsolete. In-line tenant sales for calendar year 2006 were $293 per square foot, compared to $299 at securitization. In-line tenant sales for the first six months of 2007 were approximately 4.3% higher than the same period in 2006. The loan sponsor is The Macerich Partnership LP. The mall is managed by Wilmorite Inc. Moody's LTV is 73.9%, the same as at securitization. Moody's current shadow rating is Baa3, the same as at securitization. The Desert Sky Mall Loan ($40.0 million - 6.9%) is secured by 444,551 square feet of retail space in a 899,190 square foot regional mall located in Phoenix, Arizona. The mall is shadow anchored by Sears, Dillard's (Moody's senior unsecured rating B1; stable outlook), Burlington Coat Factory (Moody's senior unsecured rating B3; stable outlook) and La Curacao, which opened in September 2007. The addition of La Curacao is part of the mall's redevelopment that includes both interior and exterior upgrades. As of July 2007 in-line space was 85.5% occupied, compared to 84.8% at securitization. For the trailing 12-month period ending June 2007 mall shop sales were $308 per square foot, compared to $327 per square foot at securitization. The loan sponsor is The Macerich Partnership LP. Moody's LTV is 70.0%, the same as at securitization. Moody's current shadow rating is Baa3, the same as at securitization. The One Pepsi Way Loan ($40.0 million -- 6.9%) is secured by a 520,000 square foot office building located in Somers, New York. As of June 2007 the property was leased to two tenants, Pepsi Bottling Group (69.2% of NRA) and General Motors (8.8% of NRA). The leases expire in December 2010 and February 2011 respectively. The building's leasing status has not changed since securitization. Moody's LTV is 64.7%, the same as at securitization. Moody's current shadow rating is Baa3, the same as at securitization. The JER Denver Office Portfolio Loan ($38.5 million -- 6.7%) is secured by four office properties located in the southeast Denver, Colorado submarkets of Greenwood Village and Centennial. The properties contain a total of 788,318 square feet. Since securitization two additional office properties that were originally in the portfolio were released from the loan security. The outstanding trust debt has decreased by approximately 23.8% since securitization due to property releases. As of August 2007 the portfolio was 88.4% occupied, compared to 92.0% at securitization. Comcast Cable Communications Inc. (September 2008 lease expiration; Moody's senior unsecured rating (P)Baa2; stable outlook) and Time Warner Telecom Inc. (October 2015 lease expiration; Moody's senior unsecured rating Caa1; stable outlook) account for 20.0% and 16.0% of total rentable area, respectively. Moody's LTV is 73.3%, compared to 73.0% at securitization. Moody's shadow rating is Ba1, the same as at securitization. The CarrAmerica -- Pool 2 Portfolio Loan ($23.7 million -- 4.1%) represents the 40.0% portion of a $59.2 million pari passu loan. There is also a $22.8 million non-trust junior secured loan and a $21.6 million mezzanine loan. The loan is secured by four office properties located in San Mateo, California, Mountain View, California and Austin, Texas (2 properties). The portfolio contains approximately 719,027 square feet, compared to 2.1 million square feet in 11 properties at securitization. The outstanding pool balance has decreased by approximately 73.7% since securitization due to property releases and the related release premiums. As of June 2007 the portfolio had a weighted average occupancy of 96.5%, compared to 92.0% at securitization for the original portfolio and 95.5% for the current portfolio. At securitization the Blackstone Group, the loan sponsor, provided a guaranty to expend $9.8 million on capital improvements, tenant improvements and leasing commissions. Moody's LTV is 60.3%, compared to 70.8% at securitization. Moody's current shadow rating is A1, compared to A3 at securitization. BARCLAYS CAPITAL: S&P Puts 'BB+' Rating Under Developing Watch -------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on six classes of the Barclays Capital Commercial Real Estate LLC Grantor Trust certificates from Terra LNR I Ltd. on CreditWatch with developing implications. The class A-1 and A-2 certificates, both rated 'AAA', are not affected by this action. The CreditWatch placements follow the Nov. 2, 2007, downgrades of Centex Corp. (to 'BBB-' from 'BBB'), Lennar Corp. (to 'BB+ from 'BBB'), and Pulte Homes (to 'BB+' from 'BBB-'). The ratings on the certificates from Terra LNR 1 depend partially on the ratings on these three companies, which provide two types of financial guarantees to the loan collateral. Aside from the downgrades of these three U.S. homebuilders, the Terra LNR I trust has benefited from increased credit support levels due to loan payoffs and principal balance reductions in the remaining three loans. As a result, the placement of the ratings on CreditWatch with developing implications could lead to both positive and negative actions. Based on the Oct. 15, 2007, trust remittance report, the three remaining loans are collateralized by West Park Master Planned Community, Potomac Yards, and Stetson Valley. As of the October trust remittance, the trust had a remaining principal balance of $206.9 million, down from $569.8 million at issuance. The loans are secured by mortgaged parcels of land that are being developed into residential home sites for sale to affiliates of the three homebuilders noted above. The repayment of the mortgage loans depends on the pace and price at which the home sites are sold. The loan is current. Standard & Poor's is currently evaluating the collateral performance of these three projects and the impact that the lowered ratings on Centex, Lennar, and Pulte could have on their ability to meet required financial guarantees. S&P will resolve the CreditWatch placements affecting the Terra LNR I certificates once S&P complete its evaluation. Ratings Placed on Creditwatch Developing Terra LNR I Ltd. Barclays Capital Commercial Real Estate LLC Grantor Trust certificates Rating ------ Class To From ----- -- ---- B AA/Watch Dev AA C A/Watch Dev A D A-/Watch Dev A- E BBB/Watch Dev BBB F BBB-/Watch Dev BBB- G BB+/Watch Dev BB+ Other Ratings Outstanding Terra LNR I Ltd. Barclays Capital Commercial Real Estate LLC Grantor Trust certificates Class Rating ----- ------ A-1 AAA A-2 AAA BERNOULLI HIGH: Moody's Puts Ba3-Rated Notes Under Negative Review ------------------------------------------------------------------ Moody's Investors Service placed these notes issued by Bernoulli High Grade CDO II, Ltd. on review for possible downgrade: Class Description: $555,000,000 Class A-1B Second Priority Senior Secured Floating Rate Notes due October 2054 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $56,000,000 Class B Third Priority Senior Secured Floating Rate Notes due October 2054 -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade Class Description: $103,000,000 Class C Fourth Priority Senior Secured Floating Rate Notes due October 2054 -- Prior Rating: Aa3 -- Current Rating: Aa3, on review for possible downgrade Class Description: $4,000,000 Class D Fifth Priority Mezzanine Deferrable Secured Floating Rate Notes due October 2054 -- Prior Rating: A3 -- Current Rating: A3, on review for possible downgrade Class Description: $3,000,000 Class E Sixth Priority Mezzanine Deferrable Secured Floating Rate Notes due October 2054 -- Prior Rating: Baa2 -- Current Rating: Baa2, on review for possible downgrade Class Description: $10,500,000 Class F Seventh Priority Mezzanine Deferrable Secured Floating Rate Notes due October 2054 -- Prior Rating: Baa3 -- Current Rating: Baa3, on review for possible downgrade Class Description: $4,500,000 Class G Eighth Priority Mezzanine Deferrable Secured Floating Rate Notes due October 2054 -- Prior Rating: Baa3 -- Current Rating: Baa3, on review for possible downgrade Class Description: $14,000,000 Income Notes due October 2054 -- Prior Rating: Ba3 -- Current Rating: Ba3, 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. BI-LO LLC: S&P Holds 'B' Rating and Removes Developing Watch ------------------------------------------------------------ Standard & Poor's Ratings Services affirmed the 'B' rating on BI- LO LLC and removed it from CreditWatch, where it was placed with developing implications on April 11, 2007. This action reflects S&P's belief that while Greenville, South Carolina-based BI-LO remains up for sale, S&P do not anticipate Lone Star Funds LLC closing on a sale in the near term. The outlook is stable. "We would likely consider a negative outlook if EBITDA declines due to increased pricing competition and weaker margins, resulting in weaker credit metrics with lease-adjusted debt to EBITDA reaching 5x," said Standard & Poor's credit analyst Stella Kapur. BLUE JAY: Moody's Rates Proposed Senior Credit Facility at B1 ------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Blue Jay Merger Corporation's proposed senior secured credit facilities, consisting of a revolving credit facility due 2013 and a term loan facility due 2014, and a Caa2 rating to the company's proposed senior unsecured notes due 2015. Blue Jay Merger Corporation will be merged into Sequa Corporation on the close of the proposed acquisition. The Corporate Family Rating was assigned at B3 with a stable outlook. Approximately $2 billion of debt securities were rated. The purpose of the proposed debt offerings is to partially finance the $2.8 billion acquisition of Sequa by private equity sponsor, Carlyle Group. Upon the consummation of the merger Sequa will be the surviving corporation and will assume all of Blue Jay Merger's obligations. Sequa's existing 8-7/8% and 9% notes are subject to redemption requirements under their current indentures, and it is anticipated that they will be redeemed in their entirety upon close of the acquisition financing transactions. Moody's intends to withdraw all of Sequa's pre LBO ratings, including its B1 Corporate Family Rating and B2 senior notes ratings when the acquisition financing is completed. Sequa's B3 Corporate Family Rating reflects high leverage and weak interest coverage pro forma the Carlyle LBO. Near term negative free cash flow resulting from continued investment across business lines is also a constraint on the rating. Despite improving fundamentals, particularly in the company's aerospace segment, high debt levels resulting from the transaction are expected to keep credit metrics weak over the near term. Sequa's Corporate Family Rating benefits from a diverse revenue base across industries and geography, which provides stability through individual industry cycles. However, the credit profiles of a number of key customers in Sequa's two largest segments, commercial aerospace (legacy airlines in particular) and automotive (especially Delphi which is seeking to emerge from bankruptcy protection) remain of concern. While the airline industry is experiencing a modest recovery, the auto business continues to experience on-going economic difficulties. The stable ratings outlook reflects Moody's expectations that the company will continue to grow its revenue base while maintaining or modestly improving margins from current levels. The company is also expected to begin to generate modest amounts of positive free cash flow as its investment phase winds down over the near term, which should be applied to modest debt reduction. Ratings or their outlook may be adjusted upward if operating results continue to improve such that these metrics are achieved: Leverage: Debt/EBITDA of less than 6.0 times; Interest Coverage: EBIT/Interest of greater than 1.5 times; Cash Flow: RCF/Debt greater than 8% with sustained positive free cash flow. Downward ratings pressure may also occur if free cash flow were to continue to remain negative such that the company's liquidity profile would be impaired, if the company were to increase debt materially for any reason, or if operating results were to deteriorate resulting in these metrics: Leverage: Debt/EBITDA of greater than 8.0 times; Interest Coverage: EBIT/Interest remaining less than 1.0 time; Cash Flow: RCF/Debt less than 5% with continued negative free cash flow. Assignments: Issuer: Blue Jay Merger Corporation -- Probability of Default Rating, Assigned B3 -- Corporate Family Rating, Assigned B3 -- Senior Secured Revolving Credit Facility due 2013, Assigned B1 (LGD3-30) -- Senior Secured Bank Term Loan due 2014, Assigned B1 (LGD3-30) -- Senior Unsecured Notes due 2015, Assigned Caa2 (LGD5-83) -- Senior Unsecured Discount Notes due 2015, Assigned Caa2 (LGD5-83) Sequa Corporation, headquartered in New York, NY, is a diversified industrial company. Its operations manufacture and repair jet engine components, perform metal coating, produce automotive airbag inflators, cigarette lighters, power outlets and sensors, and manufacture chemical detergent additives, auxiliary printing press equipment, emissions control systems and men's formalwear. Sequa had LTM 9/30/2007 revenues of approximately $2.2 billion. BOMBAY CO: Sells Headquarters to Goff Capital for $16.35 Million ---------------------------------------------------------------- Goff Capital Inc. will acquire The Bombay Company Inc.'s corporate headquarters for $16.35 million, Sheryl Jean of the Star Telegram reports. The property is a seven-story, 122,000-square-foot building and a parking garage at 550 Bailey Avenue in Fort Worth, Texas. The building, the report says, had been appraised at around $9 million. Headquartered in Fort Worth, Texas, The Bombay Company Inc., (OTC Bulletin Board: BBAO) -- http://www.bombaycompany.com/ -- designs, sources and markets a unique line of home accessories, wall decor and furniture through 384 retail outlets and the Internet in the U.S. and internationally, including Cayman Islands. The company and five of its debtor-affiliates filed for Chapter 11 protection on Sept. 20, 2007 (Bankr. N.D. Tex. Lead Case No. 07-44084). Robert D. Albergotti, Esq., John D. Penn, Esq., Ian T. Peck, Esq., and Jason B. Binford, Esq., at Haynes and Boone, L.L.P., represent the Debtors. As of May 5, 2007, the Debtors listed total assets of $239,400,000 and total debts of $173,400,000. Attorneys at Cooley, Godward, Kronish LLP acts as counsel for the Official Committee of Unsecured Creditors. Forshey & Prostok LLP is the Committee's local counsel. BON-TON STORES: Weak Sales Cue S&P to Lower Credit Rating to B -------------------------------------------------------------- Standard & Poor's Ratings Services lowered the corporate credit rating on York, Pennsylvania-based Bon-Ton Stores Inc. to 'B' from 'B+', and the senior unsecured debt rating to 'CCC+' from 'B-'. The two-notch rating differential on the unsecured notes takes into account the relatively high potential secured debt in the capital structure. About $1.27 billion of debt was outstanding at Aug. 4, 2007. The outlook is stable. "The rating action follows a trend of weaker-than-expected same- store sales, our expectation that the retail environment will continue to be extremely challenging, and our projection that EBITDA interest coverage will deteriorate to about 2.1x for 2007, with debt leverage at about 5x," said Standard & Poor's credit analyst Gerald Hirschberg. In conjunction with its release of October 2007 sales results, which showed another monthly decline, management substantially lowered its guidance for EBITDA (to $285 million) and earnings per share. When S&P revised the outlook to negative in August 2007, S&P indicated that a downgrade could follow if EBITDA fell below $300 million and coverage declines to 2.1x. Although sales and margins might remain under pressure well into 2008, S&P expect that Bon-Ton Stores will sustain credit measures that are appropriate for the 'B' rating category. However, if EBITDA continues to slide and working capital and fixed capital spending have to be substantially supplemented by additional debt, both leverage and cash flow protection could deteriorate further and lead to a negative outlook. A period of sustained improvement in sales and earnings would be necessary for Standard & Poor's to consider a positive outlook. BRANDYWINE REALTY: Inks $245.4 Million Deal with DRA Advisors ------------------------------------------------------------- Brandywine Realty Trust has signed a definitive agreement to enter into a joint venture with DRA Advisors LLC. Under the terms of the agreement, the joint venture will acquire 29 suburban Philadelphia office properties in a transaction valued at approximately $245.4 million. The transaction amount represents a capitalization rate of approximately 7.4% GAAP and 7.2% cash based on trailing twelve month net operating income through Sept. 30, 2007, and approximately a 7.9% cash yield based on 2008 projections. The 29 properties, comprise approximately 1.6 million square feet and were 95.3% occupied and 96.4% leased as of Sept. 30, 2007. The transaction is expected to close by year-end 2007, and is subject to customary closing conditions, well as the joint venture's completion of approximately $184 million of secured property financing. As a result of the transaction and certain associated financial transactions, Brandywine expects to realize total proceeds of approximately $235.2 million less transaction expenses and will receive a 20% interest in the joint venture at the closing of the transaction. Brandywine will use the net proceeds from the transaction to reduce outstanding indebtedness under its unsecured revolving credit facility. A subsidiary of Brandywine will be responsible for the management and leasing of the joint venture properties under a separate agreement. Assuming a 2007 closing, Brandywine does not currently expect that it will declare a special distribution on account of this transaction, subject to a final review of its calendar year 2007 taxable income. "We are thrilled to undertake this transaction with DRA Advisors," Gerard H. Sweeney, president and chief executive officer of Brandywine Realty Trust, stated. "DRA is a high-quality financial institution with an extremely strong track record. Our team did an outstanding job to structure this co-investment vehicle which will allow us to recycle capital to higher growth opportunities in our target markets with a particular emphasis on our current and planned development projects." "By retaining a 20% ownership stake and managing the properties, we will share in the upside from this portfolio and contribute to its future success," Mr. Sweeney added. "We believe that this transaction creates significant value for our stockholders with both a meaningful gain on sale and the retention of a significant amount of net cash proceeds." The Philadelphia office of CB Richard Ellis served as Brandywine's exclusive marketing advisor for the transaction. Three properties, aggregating 260,000 square feet, were excluded from the joint venture transaction and will be retained by Brandywine. About DRA Advisors LLC Headquartered in New York City, DRA Advisors LLC - http://www.draadvisors.com/-- is a registered investment advisor specializing in real estate investment management services for institutional and private investors, including pension funds, university endowments, foundations, and insurance companies. Founded in 1986, the firm currently manages over $9 billion in assets, consisting of over 20 million square feet of office/industrial space, 32 million square feet of retail space and over 19,000 residential units. About Brandywine Realty Trust Headquartered in Radnor, Pennsylvania, Brandywine Realty Trust (NYSE: BDN), http://www.brandywinerealty.com/-- is one of the full-service, integrated real estate companies in the United States and is focused primarily on the ownership, management and development of class A, suburban and urban office buildings in selected markets aggregating approximately 42 million square feet. * * * Fitch assigned a 'BB+' rating on Brandywine Realty Trust's Preferred Stock. The outlook is positive. BRISTOW GROUP: Prices $50 Mil. Offering of 7-1/2% Senior Notes -------------------------------------------------------------- Bristow Group Inc. has priced its private offering of $50 million of senior notes due 2017. The notes priced at 101.25, plus accrued interest from Sept. 15, 2007, and will carry an interest rate of 7-1/2%. The notes offered and Bristow's existing $300 million in principal amount of 7-1/2% senior notes due 2017 will have identical terms and will be treated as a single class of securities under the same indenture. Bristow intends to use the net proceeds from the offering to fund additional aircraft purchases under commitments and options and for general corporate purposes. Interest is payable on March 15 and September 15 of each year, beginning March 15, 2008. The closing of the senior notes offering is expected to occur on Nov. 13, 2007, and is subject to the satisfaction of customary closing conditions. About Bristow Group Inc. Headquartered in Houston, Texas, Bristow Group Inc. (NYSE:BRS) -- http://www.bristowgroup.com/-- fka Offshore Logistics Inc., provides helicopter transportation services to the worldwide offshore oil and gas industry with operations in the United States Gulf of Mexico and the North Sea. The company also has operations, both directly and indirectly, in offshore oil and gas producing regions of the world, including Australia, Brazil, China, Mexico, Nigeria, Russia and Trinidad. The company also provides production management services for oil and gas production facilities in the United States Gulf of Mexico. * * * Standard & Poor's Ratings Services placed Bristow Group Inc.'s long term corporate family and senior unsecured debt ratings at 'Ba2' in January 2006. The ratings still hold to date with a negative outlook. BUCKINGHAM CDO: Moody's Cuts Rating on $13.5 Million Notes to Ba2 ----------------------------------------------------------------- Moody's Investors Service placed these notes issued by Buckingham CDO III Ltd. on review for possible downgrade: Class Description: Class A CP Notes -- Prior Rating: P-1 -- Current Rating: P-1, on review for possible downgrade Class Description: $67,500,000 Class B Secured Floating Rate Notes Due 2051 -- 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: $37,500,000 Class C Secured Floating Rate Notes Due 2051 -- Prior Rating: Aa2 -- Current Rating: A2, on review for possible downgrade Class Description: $21,000,000 Class D Deferrable Floating Rate Notes Due 2051 -- Prior Rating: A2 -- Current Rating: Baa2, on review for possible downgrade Class Description: $13,500,000 Class E Deferrable Floating Rate Notes Due 2051 -- Prior Rating: Baa2 -- Current Rating: Ba2, 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. BUFFETS INC: Higher Default Risks Prompt Moody's to Junk Ratings ---------------------------------------------------------------- Moody's Investors Service lowered Buffets Inc.'s corporate family rating to Caa2 from Caa1, senior secured credit facilities rating to Caa1 from B2, and senior unsecured notes rating to Caa3 from Caa2. The rating outlook remains negative. Approximately $940 million of debt securities are affected. The rating action reflects Buffets' heightened probability of default as the company approaches a covenant violation on its maximum leverage ratio, primarily stemming from a further deterioration in its operating performance. The action also reflects increasing uncertainty over the company's capital structure now that the company has engaged Houlihan, Lokey, Howard & Zukin Capital to review its capital structure and business plan. HLHZ is an investment banking firm that specializes in advising distressed companies. Buffets' EBITDA as defined by its credit agreement deteriorated further to $142 million as of Sept. 19, 2007, resulting in a leverage ratio of 5.98x as compared to the required maximum leverage level of 6.00x. The maximum leverage will step down to 5.75x at the end of current quarter (ending December 2007). In absence of a 'hockey-stick' improvement in its operating performance and EBITDA, which Moody's views as unlikely at this time, Buffets will likely breach this covenant. "Buffets might get a covenant relief/waiver from its senior lenders but this could prove to be costly given the current lending environment," said Moody's analyst John Zhao, CFA. "Further, we caution that the unsecured bond holders could incur substantial losses if the company were to default on its debt obligations, while the losses on the senior secured bank debt will be modest per Moody's estimate." The negative outlook reflects the company's declining operating result and Moody's view that free cash flow will likely be negative in the near term. The outlook also reflects the company's weak liquidity as well as uncertainty surrounding its capital structure and the potential impact of changes following HLHZ's review on the balance sheet and all classes of debt holders. These ratings are affected: Buffets Inc. -- corporate family rating, downgraded to Caa2 from Caa1 -- probability of default rating, downgraded to Caa2 from Caa1 -- $40 million revolver maturing in 2011, downgraded to Caa1(LGD2, 29%) from B2(LGD2, 28%) -- $70 million synthetic letter of credit facility maturing in 2013, downgraded to Caa1(LGD2, 29%) from B2(LGD2, 28%) -- $530 million term loan B maturing in 2013, downgraded to Caa1(LGD2, 29%) from B2(LGD2, 28%) -- $300 million senior unsecured notes, downgraded to Caa3(LGD4, 69%) from Caa2(LGD5, 82%) Buffets Inc., headquartered in Eagan, Minnesota, operates and franchises steak-buffet style restaurants principally under the "Old Country Buffet", "Hometown Buffet" brand names and grill/buffet format restaurants under the brand names "Ryan's" and "Fire Mountain". The company is the second largest family dining restaurant in the industry, operating 643 restaurants in 42 states. Total reported revenues as of Sept. 19, 2007 were approximately $1.55 billion. CABLEVISION SYS: Sept. 30 Balance Sheet Upside-Down by $5.13 Bil. ----------------------------------------------------------------- Cablevision Systems Corporation reported Thursday financial results for the third quarter ended Sept. 30, 2007. At Sept. 30, 2007, the company's consolidated balance sheet showed $9.81 billion in total assets and $14.94 billion in total liabilities, resulting in a $5.13 billion total shareholders' deficit. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $2.26 billion in total current assets available to pay $2.89 billion in total current liabilities. The company reported a net loss of $79.3 million for the third quarter of 2007, compared with a net loss of $59.2 million in the corresponding quarter of 2006. Third quarter consolidated net revenue grew 9.4% to $1.51 billion compared to the prior year period, reflecting solid revenue growth in Telecommunications Services and Rainbow. Consolidated adjusted operating cash flow increased 15.5% to $494.3 million and consolidated operating income grew 59.1% to $202.1 million. Cablevision president and chief executive officer James L. Dolan commented: "For the third quarter, Cablevision experienced solid revenue and AOCF growth. This was primarily fueled by the continuing growth of our digital video, voice and high-speed data customers, which helped to maintain Cablevision's industry-leading penetration rates. Rainbow Media also helped drive the company's third quarter results with an impressive double-digit gain in revenue, due largely to a significant increase in both advertising and affiliate revenue, while MSG and Rainbow both had double-digit gains in AOCF," concluded Mr. Dolan. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2523 Other Matters On May 2, 2007, Cablevision entered into a merger agreement with Central Park Holding Company LLC, an entity owned by the Dolan Family Group, and Central Park Merger Sub Inc. On Oct. 24, 2007, the proposed merger was submitted to a vote of Cablevision's shareholders and did not receive shareholder approval. Subsequently, the parties terminated the merger agreement pursuant to its terms. About Cablevision Systems Headquartered in Bethpage, New York, Cablevision Systems Corporation (NYSE: CVC) -- http://www.cablevision.com/-- is an entertainment and telecommunications company. Its cable television operations serve more than 3 million households in the New York metropolitan area. The company's advanced telecommunications offerings include its iO: Interactive Optimum digital television, Optimum Online high-speed Internet, Optimum Voice digital voice-over-cable, and its Optimum Lightpath integrated business communications services. Cablevision's Rainbow Media Holdings LLC operates several successful programming businesses, including AMC, IFC, WE tv and other national and regional networks. In addition to its telecommunications and programming businesses, Cablevision owns Madison Square Garden and its sports teams, the New York Knicks, Rangers and Liberty. The company also operates New York's famed Radio City Music Hall and the Beacon Theatre, and owns and operates Clearview Cinemas. * * * As reported in the Troubled Company Reporter on Nov. 1, 2007, Moody's Investors Service confirmed the 'B1' corporate family rating of Cablevision Systems Corporation. However, given the uncertainty regarding the company's fiscal plan following the rejected offer to take the company private, Moody's assigned a developing outlook to Cablevision and Rainbow pending a more thorough understanding of its strategy going forward. CAIRN MEZZ: Moody's Places Ba3-Rated Notes Under Negative Watch --------------------------------------------------------------- Moody's Investors Service placed these notes issued by Cairn Mezz ABS CDO IV, Ltd. on review for possible downgrade: Class Description: $292,000,000 Class A1S Variable Funding Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $78,000,000 Class A1J Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $52,000,000 Class A2 Senior Secured Floating Rate Notes Due 2047 -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade In addition Moody's also downgraded and left on review for possible downgrade these notes: Class Description: $30,500,000 Class A3 Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: A2 -- Current Rating: Baa2, on review for possible downgrade Class Description: $20,000,000 Class B1 Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: Baa2 -- Current Rating: Ba2, on review for possible downgrade Class Description: $8,500,000 Class B2 Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2047 -- Prior Rating: Baa3 -- Current Rating: Ba3, 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. CALLIDUS DEBT: S&P Puts 'BB' Preliminary Rating on $25.5MM Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to Callidus Debt Partners CLO Fund VII Ltd./Callidus Debt Partners CLO Fund VII Inc.'s $545 million floating-rate notes due January 2021. The preliminary ratings are based on information as of Nov. 8, 2007. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect: -- The expected commensurate level of credit support in the form of subordination to be provided by the notes junior to the respective classes, and by the subordinated notes and overcollateralization; -- The cash flow structure, which was subjected to various stresses requested by Standard & Poor's; and -- The transaction's legal structure, including the issuer's bankruptcy remoteness. Preliminary Ratings Assigned Callidus Debt Partners CLO Fund VII Ltd./ Callidus Debt Partners CLO Fund VII Inc. Class Rating Amount ----- ------ ------ A AAA $443,000,000 B AA $24,000,000 C A $33,000,000 D BBB $19,500,000 E BB $25,500,000 Subordinated notes NR $55,000,000 NR - Not rated. CAPITAL AUTO: Fitch To Put BB Rating on $7.963MM Class D Trust -------------------------------------------------------------- Fitch Ratings expects to assign these ratings to Capital Auto Receivables Asset Trust 2007-4: -- $333,000,000 class A-1 'F1+'; -- $376,000,000 class A-2 'AAA'; -- $486,000,000 class A-3 'AAA'; -- $309,946,000 class A-4 'AAA'; -- $51,757,000 class B 'A'; -- $23,888,000 class C 'BBB'; -- $7,963,000 class D 'BB'. CAPITAL AUTO: Moody's Rates $7,963,000 Class D Notes at (P)Ba1 -------------------------------------------------------------- Moody's Investors Service assigned provisional ratings to Capital Auto Receivables Asset Trust 2007-4. The complete rating actions are: Issuer: Capital Auto Receivables Asset Trust 2007-4 -- $333,000,000 Class A-1 Asset Backed Notes, rated (P)P-1 -- $376,000,000 Class A-2 Asset Backed Notes, rated (P)Aaa -- $486,000,000 Class A-3 Asset Backed Notes, rated (P)Aaa -- $309,946,000 Class A-4 Asset Backed Notes, rated (P)Aaa -- $51,757,000 Class B Asset Backed Notes, rated (P)A2 -- $23,888,000 Class C Asset Backed Notes, rated (P)Baa2 -- $7,963,000 Class D Asset Backed Notes, rated (P)Ba1 The ratings are based on the quality of the underlying auto loans and their expected performance, the strength of the transaction's structure, the enhancement provided by subordination, overcollateralization of 0.25% as a percentage of the initial aggregate receivables principal balance, a fully funded non- declining 0.50% reserve account (also expressed as a percentage of the initial aggregate receivables balance), available excess spread, and the experience of GMAC LLC as servicer. CAPITAL AUTO: S&P Assigns 'BB' Prelim. Rating on $7.963MM Notes --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to Capital Auto Receivables Asset Trust 2007-4's $1.589 billion asset-backed notes series 2007-4. The preliminary ratings are based on information as of Nov. 8, 2007. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect: -- The credit quality of the underlying pool, which has a weighted average FICO score of 704.36 and consists of prime automobile loans; -- The timely interest and principal payments made under stressed cash flow modeling scenarios consistent with the ratings assigned to each class of notes; -- The credit enhancement; and -- The sound legal structure. Preliminary Ratings Assigned Capital Auto Receivables Asset Trust