/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/071129.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, November 29, 2007, Vol. 11, No. 283 Headlines 101 MONUMENT: Case Summary & Three Largest Unsecured Creditors 738 ST MARKS: Case Summary & 13 Largest Unsecured Creditors AINSWORTH LUMBER: Posts CDN$37.2MM Net Loss in Qtr. Ended Sept. 30 ALLSTATE EXCAVATING: Case Summary & 20 Largest Unsecured Creditors AMERIQUEST: Fitch Downgrades Ratings on Three Cert. Classes AMERIQUEST MORTGAGE: Fitch Holds Ratings on $1.48 Bil. Certs. AMKOR TECHNOLOGY: Improved Cash Flow Cues S&P's Positive Outlook AMR CORP: Plans to Divest American Eagle Division ARLO VI: Moody's Hacks Rating on $15 Mil. Notes to Ba3 from A3 ARLO VI: Moody's Cuts Rating on $7.5MM Notes to B2 from Baa2 ASPEN EXECUTIVE: Gets Interim OK to Use Calim Venture DIP Funds ASPEN EXECUTIVE: Asset Sale Protocol Gets Court Approval ASSET BACKED: Fitch Lowers Rating on Class M-6 Certs. to B AXON FINANCIAL: Poor Market Value Prompts S&P's Default Ratings BEAR STEARNS: Fitch Holds Low-B Ratings on Six Cert. Classes BEAR STEARNS: Moody's Junks Rating on 2004-SD3 Class B Trusts BFC SILVERTON: Moody's Junks Ratings on Three Note Classes CIGNA CORP: Moody's Affirms (P)Ba1 Rating on Preferred Stock Shelf COLORADO EDUCATIONAL: S&P Lifts Revenue Debt Rating to B+ COLUMBIA AIRCRAFT: Park Electrochemical Cancels Bid for Assets COLUMBIA AIR: Cessna Aircraft Wins Auction with $26.4 Million Bid COMPASS DIVERSIFIED: Offers Shareholders Reinvestment Plan COUNTRYWIDE HOME: Moody's Junks Ratings on Two Loan Classes CREDIT SUISSE: Fitch Lowers Ratings on $209.9MM Transactions CREDIT SUISSE: Fitch Lowers Rating on Class M-3 Certs. to B CRESTED CORP: Completes Merger Deal with U.S. Energy CROWN CASTLE: Fitch Holds 'BB' Rating on $83MM Class G Notes CROWN HOLDINGS: Completes Share Repurchase Deal with BNP Paribas CSFB 2004-CF1: Moody's Lowers Rating on Class B Loan to B3 CYRUS REINSURANCE: Moody's Rates $65MM Sr. Secured Loan at Ba1 DANKA BUSINESS: Delists American Depositary Shares from Nasdaq DECORDOVA/PERMIAN: Fitch Assigns 'B/RR4' Rating on 7.48% Bonds DEERFIELD TRIARC: Moody's Cuts Corporate Family Rating to Ba3 DENNY'S INC: Credit Repayment Cues S&P to Revise Rating to BB DOLE FOOD: Poor Operating Results Cue S&P's Negative Watch DUNMORE HOMES: U.S. Trustee Appoints 7-Member Creditors' Committee DUNMORE HOMES: Three Big Creditors Want Venue Moved to California DURA AUTOMOTIVE: Court Postpones Confirmation Hearing EMAGIN CORP: Sept. 30 Balance Sheet Upside-Down by $3.6 Million ENESCO GROUP: IRS Balks Second Amended Liquidation Plan ENVIRONMENTAL TECTONICS: PNC Waives Default on Credit Facility EQUINOX ON THE PARK: Case Summary & 20 Largest Unsecured Creditors FEENUNE LLC: Case Summary & Five Largest Unsecured Creditors FIELDSTONE MORTGAGE: Can Access C-BASS' $1.5 Mil. DIP Facility FINLAY ENTERPRISES: Posts $7.5MM Net Loss in Period Ended Nov. 3 GAP INC: Board Declares $0.08 Per Share Quarterly Dividend GP&E OPERATING LP: Involuntary Chapter 11 Case Summary GS MORTGAGE: Fitch Lowers Rating on $14.9MM Certificates to BB HANESBRANDS INC: S&P Affirms 'B+' Rating and Revises Outlook HOMEBANC CORP: Can Sell Mortgage Loans with Unpaid Amount of $10MM HOMESTAR MORTGAGE: S&P Cuts Rating on Class M-8 to B from BBB- IPSWICH STREET: Moody's Places B1 Rating Under Review ISONICS CORP: Inks Merger Term Sheet with Universal Guardian JAMES RIVER: Selling 4.5MM Shares Common Stock in Public Offering JAMESON DEVELOPMENT: Voluntary Chapter 11 Case Summary JAYS FOODS: Court Fixes December 17 as Claims Bar Date JOHN RYAN: Case Summary & 4 Largest Unsecured Creditors KMART CORP: Fitch Retains Junk Ratings on $3.9MM Certificates LAKE MARTIN: Selects Espy Metcalf as Bankruptcy Counsel LAKE MARTIN: Can Borrow $4,415,000 from Empire Financial LAKE MARTIN: Wants R. Smith and D. Huskey as Special Counsels LEVITT AND SONS: Homeowners Object to Home Sale Contracts Closing LEVITT AND SONS: Laurel Canyon Residents Want Grace Period LIFEPOINT HOSPITALS: Board Okays $150 Mil. Share Repurchase Plan MACO INC: Files Schedules of Assets and Liabilities MACO STEEL: Committee Wants to Hire Barnes & Thornburg as Counsel MARCAL PAPER: Court Approves Bidding Procedure for Sale of Assets MEDICAL SOLUTIONS: Sept. 30 Balance Sheet Upside-Down by $2.1 Mil. MERRILL LYNCH: Fitch Rates $3.1 Million Class B-5 Certs. at B+ MERRILL LYNCH: Fitch Downgrades Rating on Class B3 Loans to B MICHAEL CLIFFORD: Case Summary & 20 Largest Unsecured Creditors MORGAN CREEK/PERMIAN: Fitch Rates 7.46% Facility Bonds at B/RR4 MORGAN STANLEY: Moody's Lowers Junks Ratings on Three Classes MOTHERS WORK: S&P Hold 'B' Rating and Revises Outlook to Negative MOVIE GALLERY: Panel Taps Imperial Capital as Financial Advisor MOVIE GALLERY: Wants to Pay Obligations to Smaller Suppliers MRS FIELDS: S&P Withdraws Ratings at Company's Request MTI TECHNOLOGY: U.S. Trustee Appoints Nine-Member Creditors Panel MTI TECHNOLOGY: Committee Taps Winthrop as Insolvency Counsel NEPTUNE INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $2 Mil. NETBANK INC: Intends to Liquidate Assets Under Chapter 11 ORION 2006-2: Poor Credit Quality Cues Moody's Rating Downgrades ORLANDO CITYPLACE: Wants Additional Time to Sell Lexington Hotel PACER HEALTH: Sept. 30 Balance Sheet Upside-Down by $6.8 Million PACIFICNET INC: Posts $220,000 Net Loss in Qtr. Ended Sept. 30 PARK PLACE: Fitch Puts 'BB' Ratings on Three Cert. Classes PARK PLACE: Fitch Cuts Rating on Three Class Certificates PHARMED GROUP: Hires Berger Singerman as Bankruptcy Counsel PHARMED GROUP: Hires Trumbull Group as Claims and Noticing Agent POINTE LLC: Case Summary & Five Largest Unsecured Creditors PRIMITIVO IGLESIAS: Case Summary & 18 Largest Unsecured Creditors QUEBECOR WORLD: Dividend Payment Suspension Cues S&P to Cut Rating REFCO INC: RJM Wants Settlement Pact with FXCM Parties Approved REFCO INC: Judge Drain Approves Settlement Agreement with SPhinX REFCO INC: RCM Distributes $279.5 Million from SPhinX Proceeds RESIDENTIAL ACCREDIT: S&P Retains 'B' Rating Under Neg. Watch RESIDENTIAL ASSET: Moody's Lowers Ratings on 13 Tranches REUNION INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors RFSC SERIES: Moody's Lowers Rating on Class M-2 Loans to Ba1 RIDGEVIEW PROFESSIONAL: Case Summary & Seven Largest Creditors SACO MORTGAGE: Fitch Lowers Ratings on $56.9 Million Certificates SAN HOLDINGS: Files for Bankruptcy Under Chapter 7 in Colorado SAN HOLDINGS: Voluntary Chapter 7 Case Summary SAVE OUR SPRINGS: To Pay Creditors from $60,000 Settlement Fund SBA CMBS: Fitch Affirms 'B+' Rating on $71 Million Certificates SEA CONTAINERS: Wants Exclusive Period Extended to February 20 SEA CONTAINERS: Court Approves Payment of Diligence Fees SECURED ASSETS: Richard Kipperman Appointed as Chapter 11 Trustee SILVER ELMS: Moody's Cuts Rating on $8 Million Notes to B2 SINOFRESH HEALT: Sept. 30 Balance Sheet Upside-Down by $2.8 Mil. SPECIALTY UNDERWRITING: Fitch Holds 'BB' Rating on $2.7MM Trust STANDARD PACIFIC: Denies Rumors of Looming Bankruptcy Filing STRUCTURED ASSET: S&P Junks Rating on Class M3 Certificates STRUCTURED ASSET: Moody's Cuts Rating on Class M4 Loans to B3 SUNNY DELIGHT: Improved Performance Cues S&P to Lift Rating T&B MORTGAGE: Case Summary & 14 Largest Unsecured Creditors TARRAGON CORP: Provides Update on Addressing Liquidity Issues TCM MEDIA: Completed Sale Cues Moody's to Affirm B2 Rating TERWIN MORTGAGE: S&P Puts Default Rating on Class B-5 Loans TESORO CORP: Tracinda Withdraws Common Stock Tender Offer THORPE INSULATION: Taps Pachulski Stang as General Counsel THORPE INSULATION: U.S. Trustee Appoints Nine-Member Committee THORPE INSULATION: Pacific Taps Clark & Trevithick as Counsel TRANSAX INT'L: Sept. 30 Balance Sheet Upside-Down by $3.3 Million TRAVELCLICK HOLDINGS: S&P Assigns 'B' Corporate Credit Rating TREY RESOURCES: Unit Inks LOI to Sell Assets to SWK Solutions TRIBUNE COMPANY: FCC to Decide on Temporary Waiver Today TRICADIA CDO: S&P Puts 'BB' Rating on Class F Notes Under Watch TRUMAN CAPITAL: Moody's Cuts Rating on Two Classes Loan to B3 TYCO INTERNATIONAL: Receives Notice of Default from Bank of NY UAL CORP: Proposed Amendment Prompts S&P to Hold 'B' Rating UAL CORP: Planned Amendment Cues Moody's to Hold B2 Rating UNIVERSAL GUARDIAN: Inks Merger Term Sheet with Isonics VICTOR BELLO: Case Summary & 10 Largest Unsecured Creditors WACHOVIA BANK: Moody's Assigns B3 Rating on $5.547 Million Trust WACHOVIA MORTGAGE: Moody's Cuts Rating on Two Classes to Ba1 WELLS FARGO: Fitch Rates $2.234MM Class B-5 Certificates at B WHERIFY WIRELESS: Sept. 30 Balance Sheet Upside-Down by $13.8 Mil. WILLIAM SPURGEON: Case Summary & 14 Largest Unsecured Creditors WORKFLOW MANAGEMENT: S&P Places 'B' Rating Under Negative Watch ZUFFA LLC: Poor Performance Cues S&P's Ratings Downgrades * Euler Hermes Says Business Bankruptcy Numbers Continue to Rise * Steve Hedberg Nominated to American College of Bankruptcy Board *Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ********* 101 MONUMENT: Case Summary & Three Largest Unsecured Creditors -------------------------------------------------------------- Debtor: 101 Monument Road, Inc. c/o Atlantia Holdings, Inc. 645 East Dania Beach Boulevard Dania Beach, FL 33004 Bankruptcy Case No.: 07-20345 Chapter 11 Petition Date: November 26, 2007 Court: Southern District of Florida (Fort Lauderdale) Judge: Raymond B. Ray Debtor's Counsel: Harold D. Moorefield Jr., Esq. Stearns Weaver Miller et al. 150 West Flagler Street, Suite 2200 Miami, FL 33130 Tel: (305) 789-3467 Fax: (305) 789-3395 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its Three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ DBR Asset Management Trade Debt Unknown Brian Mark One Financial Plaza, Suite 2001 Fort Lauderdale, FL 33394 Probate Estate of Loans Unknown Konstantinos Boulis c/o Joan S. Wagner and Gus Morfidis Co-Personal Representatives 645 East Danie Beach Boulevard Dania, FL 33004 Waldman Feluren Hildebrandt and Legal Services $39,625 Trigoboff 2200 North Commerce Parkway Suite 202 Weston, FL 33326-3258 738 ST MARKS: Case Summary & 13 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: 738 St. Marks Avenue Associates aka 738 St. Marks Avenue Rehab Associates 738 St. Marks Avenue Brooklyn, NY 11213 Bankruptcy Case No.: 07-46457 Chapter 11 Petition Date: November 26, 2007 Court: Eastern District of New York (Brooklyn) Debtor's Counsel: Arnold Mitchell Greene, Esq. Robinson Brog Leinwand Greene et al. 1345 Avenue of the Americas 31st Floor New York, NY 10105 Tel: (212) 603-6399 Fax: (212) 956-2164 Total Assets: $1,632,553 Total Debts: $1,150,224 Debtor's list of its 13 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Bernard Schnitzer $125,333 27 Island Drive Boynton Beach, FL 33463 Jay Oberst $125,333 6 Westminster Road Medham, NJ 07945 Alan Halpert $125,333 7282 Ballantrae Court Boca Raton, FL 33496 AICCO Inc. $10,000 Lex Construction $5,000 BPC Management Corp. $2,000 Keyspan Energy Delivery $1,100 Con Edison $975 Kone Inc. $347 Jordan Intercom $250 Paychex Inc. $137 Global Paladin Compactor $54 Sprint $44 AINSWORTH LUMBER: Posts CDN$37.2MM Net Loss in Qtr. Ended Sept. 30 ------------------------------------------------------------------ Ainsworth Lumber Co. Ltd. reported its financial results for the quarter ended Sept. 30, 2007. The net loss for the quarter ending Sept. 30, 2007, was CDN$37.2 million on sales of CDN$150.8 million, compared to a net loss of CDN$77.5 million on sales of CDN$181.1 million in 2006. The reduced loss for the third quarter of 2007 reflected production curtailments and other cost control measures implemented by the company as well as a significant foreign exchange gain on long-term debt. The reported results for the 2007 quarter included a CDN$52.1 million tax valuation allowance on previously benefited tax losses, an CDN$8.6 million impairment charge on intangible assets, and an CDN$8.6 million legal settlement provision. On a year to date basis, the net loss of CDN$32.0 million for 2007 was CDN$2.1 million higher than the net loss in the same period of 2006. Cash from operations decreased compared to the third quarter of 2006 and the first nine months of 2006 as a result of the unfavourable market conditions, which reduced profitability. As of Sept. 30, 2007, its adjusted working capital was CDN$170.6 million, compared to CDN$186.6 million as at Dec. 31, 2006. Additions to capital assets were CDN$7.4 million in the third quarter of 2007, down from CDN$60.1 million in the third quarter of 2006. Year to date capital spending was CDN$65.7 million in 2007 compared to CDN$166.9 million in 2006. This decrease reflects our decision to put any discretionary capital expenditures, including the expansion of Grande Prairie, on hold until market conditions improve. At Sept. 30, 2007, the company's balance sheet showed total assets of CDN$1.3 billion and total liabilities of CDN$1.1 billion, resulting in a stockholders' equity of CDN$191.5 million. Equity at Dec. 31, 2006, CDN$294.1 million. Headquartered in Vancouver, British Columbia, Ainsworth Lumber Co. Ltd. (TSE:ANS) -- http://www.ainsworth.ca/-- manufactures structural-engineered wood products, including oriented strand board, and specialty overlaid plywood. The company owns and operates six OSB manufacturing facilities, three in Canada and three in northern Minnesota. It has a 50% ownership interest in an OSB facility, located in High Level, Alberta. Ainsworth is also a manufacturer of specialty overlaid concrete-form plywood products in North America. Ainsworth's business is focused on the structural wood panels sector. It offers value-added products, such as OSB webstock, rimboard, radiant barrier OSB panels, jumbo OSB panels, export-standard OSB and specialty overlaid plywood. * * * As reported in the Troubled Company Reporter on Nov. 15, 2007, Moody's Investors Service downgraded Ainsworth Lumber Co. Ltd.'s corporate family rating to Caa1 from B2. At the same time, the ratings on the senior unsecured notes were downgraded to Caa1 from B2 and the rating on the secured term loan was downgraded to B2 from Ba3. Standard & Poor's Ratings Services placed Ainsworth Lumber Co. Ltd.'s long-term foreign and local issuer credit ratings at 'CCC+' in March 2007. The outlook is negative. The ratings still hold to date. ALLSTATE EXCAVATING: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Allstate Excavating Corp. aka Allstate Precast 201 Wheatsworth Road Hamburg, NJ 07419 Bankruptcy Case No.: 07-27391 Chapter 11 Petition Date: November 27, 2007 Court: District of New Jersey (Newark) Debtor's Counsel: David L. Bruck, Esq. Greenbaum, Rowe, Smith, & Davis LLP P.O. Box 5600 Woodbridge, NJ 07095 Tel: (732) 549-5600 Fax: (732) 549-1881 Total Assets: $2,310,000 Total Debts: $6,212,908 Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Estate of William H. Wurster $2,700,000 c/o Black & Gerngross P.C. 1617 John F. Kennedy Boulevard Suite 1575 Attn: Alfred Rauch III, Esq. Philadelphia, PA 19103 Woodland Group $354,442 376 Route 15 Suite 205 Sparta, NJ 07871 All State Property Management Rent $198,500 201 Wheatsworth Road Hamburg, NJ 07419 Lehigh Cement Company $59,292 Kennedy Culvert & Supply $54,481 Hamburg Supply $43,053 Foley Machinery $41,234 JC Concrete and Curb Co. $34,997 Giant Tire Service $29,928 Peerless Concrete Co. $20,851 Specco Industries Inc. $19,926 Double Twenties, Inc. $19,005 Extec Northeast $18,509 American Express $16,493 Carista, Kulsar & Wade $15,754 Recon Wall Systems $15,601 Civil Solutions Group, LLC $13,160 Equipment Supply $12,264 C&C Foundations $10,000 AJ Concrete $9,490 AMERIQUEST: Fitch Downgrades Ratings on Three Cert. Classes ----------------------------------------------------------- Fitch has taken rating actions on these two Ameriquest subprime issues: Argent Series (ARSI) 2004-W3: -- Class A affirmed at 'AAA'; -- Class M-1 affirmed at 'A-'; -- Class M-2 affirmed at 'BBB+'; -- Class M-3 affirmed at 'BBB'; -- Class M-4 downgraded to 'BB' from 'BBB-'; -- Class M-5 downgraded to 'B' from 'BB+,' placed on Rating Watch Negative; Ameriquest Series (AMSI) 2003-AR3: -- Class M-2 affirmed at 'AA'; -- Class M-3 affirmed at 'AA-'; -- Class M-4 affirmed at 'A+'; -- Class M-5 affirmed at 'A'; -- Class M-6 downgraded to 'BB' from 'BBB-'; placed on Rating Watch Negative. The affirmations, affecting approximately $170.1 million of the outstanding balances, are taken due to a satisfactory relationship of credit enhancement to expected losses. In series 2004-W3, class M-4 is downgraded and class M-5 is downgraded and placed on Rating Watch Negative due to monthly losses exceeding excess spread, which has caused deterioration in the overcollateralization amount. As of the October 2007 distribution, the OC amount of $2.9 million is below the target amount of $3.8 million. Monthly losses have exceeded excess spread by an average of $270 thousand over the last twelve months. As of the cut-off date, the pool factor (percentage of loans remaining) for series 2004-W3 is 18% and 13.94% of the remaining balance is more than sixty days delinquent. The deal is currently seasoned 43 months. In series 2003-AR3, class M-6 is placed on Rating Watch Negative due to monthly losses exceeding excess spread, which has caused deterioration in the OC amount. As of the October 2007 distribution, the OC amount of $11.4 million is below the target of $21.2 million. Monthly losses have exceeded excess spread by an average of $591 thousand over the last 12 months. As of the cut-off date, the pool factor for series 2003-AR3 is 7% and 22.8% of the remaining balance is more than sixty days delinquent. The deal is currently seasoned 52 months. The collateral in the aforementioned transaction consists of fixed- and adjustable-rate, closed-end, first lien subprime mortgage loans. For series 2003-AR3 and 2004-W3 the majority of loans were originated or acquired by Ameriquest or Argent respectively. All of the mortgage loans are serviced by Citi Residential Lending Inc., which is rated 'RPS3+' by Fitch. AMERIQUEST MORTGAGE: Fitch Holds Ratings on $1.48 Bil. Certs. ------------------------------------------------------------- Fitch Ratings has taken these rating actions on Ameriquest mortgage pass-through certificates. Affirmations total $1.48 billion and downgrades total $39.5 million. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: Series 2005-R2: -- $143.6 million class A affirmed at 'AAA' (BL:73.72, LCR:7.82); -- $31.2 million class M-1 affirmed at 'AA+' (BL:63.43, LCR:6.73); -- $49.8 million class M-2 affirmed at 'AA' (BL:48.97, LCR:5.2); -- $16.8 million class M-3 affirmed at 'AA-' (BL:44.9, LCR:4.77); -- $28.8 million class M-4 affirmed at 'A+' (BL:37.33, LCR:3.96); -- $16.8 million class M-5 affirmed at 'A' (BL:31.02, LCR:3.29); -- $12.0 million class M-6 affirmed at 'A-' (BL:26.05, LCR:2.76); -- $19.2 million class M-7 affirmed at 'BBB+' (BL:18.81, LCR:2); -- $9.0 million class M-8 affirmed at 'BBB' (BL:17.45, LCR:1.85); -- $13.2 million class M-9 affirmed at 'BBB' (BL:15.38, LCR:1.63); -- $7.8 million class M-10 affirmed at 'BB+' (BL:14.19, LCR:1.51); -- $12.0 million class M-11 affirmed at 'BB' (BL:12.62, LCR:1.34); Deal Summary -- Originators: Ameriquest Mortgage Company; -- 60+ day Delinquency: 17.75%; -- Realized Losses to date (% of Original Balance): 1.22%; -- Expected Remaining Losses (% of Current Balance): 9.42%; -- Cumulative Expected Losses (% of Original Balance): 4.15%. Series 2005-R3: -- $396.3 million class A affirmed at 'AAA' (BL:50.4, LCR:5.70); -- $53.0 million class M-1 affirmed at 'AA+' (BL:38.67, LCR:4.37); -- $47.0 million class M-2 affirmed at 'AA' (BL:31.58, LCR:3.57); -- $27.0 million class M-3 affirmed at 'AA-' (BL:27.38, LCR:3.09); -- $25.0 million class M-4 affirmed at 'A+' (BL:23.46, LCR:2.65); -- $19.0 million class M-5 affirmed at 'A' (BL:20.47, LCR:2.31); -- $13.0 million class M-6 affirmed at 'A-' (BL:18.37, LCR:2.08); -- $10.0 million class M-7 affirmed at 'BBB+' (BL:16.64, LCR:1.88); -- $10.0 million class M-8 affirmed at 'BBB' (BL:14.92, LCR:1.69); -- $13.0 million class M-9 affirmed at 'BBB-' (BL:12.63, LCR:1.43); -- $23.0 million class M-10 downgraded to 'BB' from 'BB+' (BL:8.94, LCR:1.01); Deal Summary -- Originators: Ameriquest Mortgage Company; -- 60+ day Delinquency: 19.04%; -- Realized Losses to date (% of Original Balance): 0.78%; -- Expected Remaining Losses (% of Current Balance): 8.85%; -- Cumulative Expected Losses (% of Original Balance): 3.64%. Series 2005-R5: -- $280.9 million class A affirmed at 'AAA' (BL:55.68, LCR:4.91); -- $48.0 million class M-1 affirmed at 'AA+' (BL:48.87, LCR:4.31); -- $43.5 million class M-2 affirmed at 'AA+' (BL:40.99, LCR:3.62); -- $29.3 million class M-3 affirmed at 'AA' (BL:35.53, LCR:3.13); -- $24.0 million class M-4 affirmed at 'AA-' (BL:31.01, LCR:2.73); -- $23.3 million class M-5 affirmed at 'A' (BL:26.64, LCR:2.35); -- $18.8 million class M-6 affirmed at 'A-' (BL:17.79, LCR:1.57); -- $15.0 million class M-7 affirmed at 'BBB+' (BL:15.79, LCR:1.39); -- $14.3 million class M-8 affirmed at 'BBB' (BL:13.84, LCR:1.22); -- $8.3 million class M-9 downgraded to 'BBB-' from 'BBB' (BL:12.59, LCR:1.11); -- $8.3 million class M-10 downgraded to 'BB' from 'BB+' (BL:11.59, LCR:1.02); -- $11.3 million class M-11 affirmed at 'BB' (BL:11.15, LCR:0.98); Deal Summary -- Originators: Ameriquest Mortgage Company; -- 60+ day Delinquency: 17.73%; -- Realized Losses to date (% of Original Balance): 1.05%; -- Expected Remaining Losses (% of Current Balance): 11.34%; -- Cumulative Expected Losses (% of Original Balance): 5.12%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. AMKOR TECHNOLOGY: Improved Cash Flow Cues S&P's Positive Outlook ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Chandler, Arizona-based Amkor Technology Inc. to positive from stable, reflecting improved cash flow and leverage. The corporate credit rating is affirmed at 'B+'. "The ratings on Amkor reflect challenging industry characteristics, limited demand visibility, and high operating leverage," said Standard & Poor's credit analyst Lucy Patricola. "These factors are partially offset by the company's strong market position and sustained improvement in operations and cash flow." Amkor is a leading independent provider of outsourced packaging and testing services to semiconductor makers. Sales for the 12 months ended September 2007 totaled $2.7 billion, and total lease- adjusted debt was $1.9 billion. Positive free operating cash flow has been improving since 2006, driven by stable profitability, working capital efficiencies, and moderate capital spending. For the nine months ended in September, positive free cash flow totaled $254 million, up from $128 million in 2006. Amkor has used surplus cash to reduce debt and replenish liquidity. Amkor's leverage currently is low for the rating, with debt to EBITDA of 2.8x as of Sept. 30, 2007, compared with 6.5x as of December 2005. Pro forma for the potential retirement of 2008 maturities, leverage could fall further. AMR CORP: Plans to Divest American Eagle Division ------------------------------------------------- AMR Corporation, the parent company of American Airlines Inc., plans to divest American Eagle, its regional carrier. AMR, which has been engaged in an ongoing strategic value review process, relates that a divestiture of American Eagle is in the best interests of AMR and its shareholders and will be beneficial to American, American Eagle, their employees, and other stakeholders. The divestiture of American Eagle is intended to provide it with the structure, incentives and opportunities to win new business and provide new opportunities for American Eagle's employees. AMR also stated that the divestiture will enable American to focus on its mainline business, while ensuring American's continued access to cost-competitive regional feed. Once the two airlines are separated, it is expected that they will operate pursuant to a mutually beneficial air services agreement under which American Eagle will continue to provide American with regional flying of a scope and quality comparable to that provided prior to the separation and on terms that reflect today's market for those services. AMR evaluates the form of the divestiture, which may include a spin-off to AMR shareholders, a sale to a third party, or some other form of separation from AMR. The company expects to complete the divestiture in 2008; however, the completion of any transaction and its timing will depend on a number of factors, including general economic, industry and financial market conditions, well as the ultimate form of the divestiture. "The decision comes after a careful and deliberate evaluation of the strategy that will best enable us to continue to create value for our shareholders," Gerard Arpey, AMR Chairman and CEO, said. "We have worked hard over the years to build a regional airline that is fully capable of standing on its own and is well positioned to pursue growth opportunities outside of the AMR corporate structure." Mr. Arpey noted that, in addition to AMR having put in place an independent American Eagle management structure, with a chief executive officer and chief financial officer, American Eagle also has a well-formed operational structure and organization and has produced independently audited financial results for the past several years. Earlier this year, American and American Eagle entered into a new regional flying agreement between the airlines that reflects market-based rates, which ensures that American continues to have access to quality feed on competitive terms. Mr. Arpey added that AMR's divestiture of American Eagle and the regional airline's ability to provide quality feed at competitive rates to other carriers, well as American, will better position American Eagle to compete for new customers and growth opportunities in the future. American Eagle is a fully developed operating unit providing a full range of regional airline services with excellent employees and a modern fleet. It operates approximately 300 aircraft, with approximately 1,700 daily flights to more than 150 cities throughout the United States, Canada, the Bahamas, the Caribbean and Mexico. In 2007, American Eagle expects to generate annual revenues of approximately $2.3 billion. The planned divestiture would include both American Eagle Airlines Inc., which feeds American Airlines hubs throughout North America, and its affiliate, Executive Airlines Inc., which carries the American Eagle name throughout the Bahamas and the Caribbean from bases in Miami and San Juan, Puerto Rico. About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. * * * As reported in the Troubled Company Reporter on Nov. 15, 2007, Fitch Ratings affirmed the debt ratings of AMR Corp. and its principal operating subsidiary American Airlines Inc., as: (i)AMR: issuer default rating at 'B-'; and senior unsecured debt at 'CCC'/RR6'; (ii)American Airlines: issuer default rating at 'B- '; secured bank credit facility at 'BB-/RR1'. The Rating Outlook for both AMR and American has been revised to positive from stable. ARLO VI: Moody's Hacks Rating on $15 Mil. Notes to Ba3 from A3 -------------------------------------------------------------- Moody's Investors Service downgraded and placed these notes issued by ARLO VI Limited Series 2006 (Marine Pier 1) on review for possible downgrade: Class Description: $15,000,000 Variable Secured Limited Recourse Credit-Linked Notes due 2047 -- Prior Rating: A3 -- 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. ARLO VI: Moody's Cuts Rating on $7.5MM Notes to B2 from Baa2 ------------------------------------------------------------ Moody's Investors Service downgraded and placed these notes issued by ARLO VI Limited Series 2006 (South Pier 1) on review for possible downgrade: Class Description: $7,500,000 Variable Secured Limited Recourse Credit-Linked Notes due 2047 -- Prior Rating: Baa2 -- 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. ASPEN EXECUTIVE: Gets Interim OK to Use Calim Venture DIP Funds --------------------------------------------------------------- Aspen Executive Air LLC obtained interim approval from the U.S. Bankruptcy Court for the District of Delaware to obtain up to $2,000,000 in debtor-in-possession financing from John P. Calamos, Sr. and Calim Venture Parters II, LLC. The Debtor needs the interim facility to, among other things: -- maintain business relationships with vendors, suppliers and customers; -- make payroll; -- satisfy other working capital and operational needs; and -- proceed with an auction to sell its business as a going concern. Interest on the funds will accrue at the rate of 11% per annum calculated on a 360-day year. Upon the occurrence of and during the continuance of any event of default, interest will be payable at 2% above the 11% rate. Pursuant to Section 364(c)(l) of the Bankruptcy Code, $600,000 of the DIP Obligations will constitute allowed claims against the Debtor with priority over any and all claims. As security for a maximum of $600,000 of the DIP Obligations, the Debtor grants the DIP Lenders these security interests and liens: a) first lien on unencumbered property, including unencumbered cash, inventory, and accounts receivable; b) liens junior to certain other liens on all of the Debtor's prepetition and postpetition properties; and c) liens senior to any lien avoided and preserved for the benefit of the Debtor and its estate or any lien granted in favor of any federal, state, and other governmental units. Pursuant to the Interim Order, the DIP Lenders will be named as additional insured on each insurance policy maintained by the Debtor which in any way relates to the DIP Lenders' collateral. The proceeds of any such insurance policy will be applied to repay the obligations under the interim facility, in the priority in which the DIP Lenders have an interest in the underlying the collateral. The hearing to consider final approval of the financing has been set for Dec. 18, 2007, at 12:00 p.m., EST. Based in Basalt, Colorado, Aspen Executive Air, L.L.C., aka AEXJet -- http://www.aexjet.com/-- is a private jet travel company. The company filed for chapter 11 protection on Sept. 14, 2007 (Bankr. D. Del. Case No. 07-11341). Laura Davis Jones, Esq., Bruce Grohsgal, Esq., and Curtis A. Hehn, Esq., at Pachulski Stang Ziehl & Jones LLP represent the Debtor. Donald J. Bowman, Jr., Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor represent the Official Committee of Unsecured Creditors. When the Debtor filed for protection form its creditors, it listed assets between $1 million and $100 million. The Debtor's list of 20 largest unsecured creditors showed claims of more than $20 million. ASPEN EXECUTIVE: Asset Sale Protocol Gets Court Approval -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware approved the procedures proposed by Aspen Executive Air LLC governing the sale of substantially all of its assets to Pinnacle Air LLC, subject to higher and better offers. Pinnacle Air is currently owned by Robert Thornton, Wiliam Schwyhart, and Mrs. J.B. Hunt. In connection with the sale, John P. Calamos, Sr. -- the Debtor's postpetition financing lender -- is expected to make an investment in Pinnacle Air and become its controlling shareholder. Auction of the assets will be held on Dec. 14, 2007, at the offices of Pachulski Stang Ziehl & Jones LLP, 919 North Market Street, 17th Floor, P.O. Box 8705, in Wilmington, Delaware. To participate in the auction, competing bids must be submitted on or before 12:00 p.m. EST on Dec. 13, 2007. Initial overbid for the assets is $150,000 with additional bids in increments of at least $100,000. The hearing to consider results of the sale has been set for Dec. 18, 2007, at 12:00 p.m. EST. Objections to the sale, if any, are due 4:00 p.m. EST on Dec. 11, 2007. Based in Basalt, Colorado, Aspen Executive Air, L.L.C., aka AEXJet -- http://www.aexjet.com/-- is a private jet travel company. The company filed for chapter 11 protection on Sept. 14, 2007 (Bankr. D. Del. Case No. 07-11341). Laura Davis Jones, Esq., Bruce Grohsgal, Esq., and Curtis A. Hehn, Esq., at Pachulski Stang Ziehl & Jones LLP represent the Debtor. Donald J. Bowman, Jr., Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor represent the Official Committee of Unsecured Creditors. When the Debtor filed for protection form its creditors, it listed assets between $1 million and $100 million. The Debtor's list of 20 largest unsecured creditors showed claims of more than $20 million. ASSET BACKED: Fitch Lowers Rating on Class M-6 Certs. to B ---------------------------------------------------------- Fitch Ratings has taken these rating actions on Asset Backed Funding Corp. mortgage pass-through certificates: Series 2003-WF1 -- Class A-2 affirmed at 'AAA'; -- Class M-1 affirmed at 'AA'; -- Class M-2 affirmed at 'A+'; -- Class M-3 downgraded to 'BB' from 'BBB+' and removed from Rating Watch Negative; -- Class M-4 downgraded to 'BB-'from 'BBB-' and removed from Rating Watch Negative. Series 2003-WMC1 -- Class M-1 affirmed at 'AAA'; -- Class M-2 affirmed at 'A+'; -- Class M-3 affirmed at 'A'; -- Class M-4 affirmed at 'BBB+'; -- Class M-5, rated 'BBB', placed on Rating Watch Negative; -- Class M-6 downgraded to 'B' from 'BBB-'. The affirmations reflect a satisfactory relationship between credit enhancement and future loss expectations and affect approximately $65 million of outstanding certificates, as of the October 2007 distribution date. The downgrades total approximately $3.2 million of outstanding certificates and the bond placed on rating watch negative has a balance outstanding of approximately $1 million. These rating actions reflect the deterioration of CE relative to future expected losses. The transactions are seasoned 55 months and 47 months, respectively. The pool factors are 11% and 9%, respectively. The cumulative losses to date, as a percentage of the pools' initial balances, are 1.17% and 0.68%, respectively. The underlying collateral consists of 1) fixed-rate and adjustable-rate loans secured by first liens on residential mortgage properties extended to subprime borrowers for the 2003- WF1 transaction and 2) fixed-rate and adjustable-rate mortgage loans secured by first and second liens for the 2003-WMC1 transaction. The servicers for the loans in these transactions are Wells Fargo Home Mortgage, Inc (2003-WF1) and HomEq Servicing Corp. (2003-WMC1) and they are both rated 'RPS1', by Fitch. As of the October 2007 distribution date, for series 2003-WF1, the overcollateralization was $597,470 with a target of $1,460,949. The 60+ delinquencies are 10.04% of current collateral balance. This includes foreclosures and REO of 0.96% and 1.18%, respectively. For the 2003-WMC1 transaction, the OC was $1,147,920 with a target of $2,140,458. The 60+ delinquencies are 10.69% of current collateral balance. This includes foreclosures and REO of 3.39% and 2.14%, respectively. AXON FINANCIAL: Poor Market Value Prompts S&P's Default Ratings --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its issuer credit rating on Axon Financial Funding LLC and Axon Financial Funding Ltd., co-issuers of the structured investment vehicle. Standard & Poor's also lowered its ratings on Axon's commercial paper, medium-term note, and subordinated mezzanine note programs. The downgrades reflect further deterioration of the market value of Axon's portfolio. On Nov. 19, 2007, Axon Asset Management Inc. notified Standard & Poor's that it had determined that the assets were insufficient to fully repay the senior liabilities, causing an "automatic liquidation event." The net asset value to total paid-in capital has fallen below 0%. All liability payments will be suspended and all senior liabilities will be paid pari passu once the collateral is liquidated. As a result of the automatic liquidation event, Axon failed to pay its liabilities maturing on Nov. 26, 2007. The outstanding amount of Axon's senior debt is approximately $8.28 billion, and the outstanding amount of the subordinated mezzanine notes is approximately $890.00 million. Axon is a SIV structure managed by Axon Asset Management Inc., which purchases assets, manages the portfolio, and oversees the issuance of CP and MTNs. The portfolio is predominantly invested in structured finance assets, a considerable portion of which is U.S. RMBS, CMBS, and CDO securities. Ratings Lowered Axon Financial Funding LLC and Axon Financial Funding Ltd. Up to $20.00 billion European and U.S. CP and MTN programs and up to $1.25 billion subordinated mezzanine note program Rating ------ To From -- ----- Issuer credit D CCC/Watch Neg/C CP program D C/Watch Neg MTN program D CCC/Watch Neg Sub. mezzanine note program D CCC-/Watch Neg BEAR STEARNS: Fitch Holds Low-B Ratings on Six Cert. Classes ------------------------------------------------------------ Fitch Ratings has affirmed Bear Stearns Commercial Mortgage Securities Trust's commercial mortgage pass-through certificates, series 2002-TOP8, as: -- $99.3 million class A-1 at 'AAA'; -- $538.8 million class A-2 at 'AAA'; -- Interest only classes X-1 and X-2 at 'AAA'; -- $25.3 million class B at 'AAA'; -- $28.4 million class C at 'A+'; -- $9.5 million class D at 'A'. -- $11.6 million class E at 'BBB+'; -- $6.3 million class F at 'BBB'; -- $4.2 million class G at 'BBB-'; -- $8.4 million class H at 'BB+'; -- $3.2 million class J at 'BB'; -- $4.2 million class K at 'BB-'; -- $3.2 million class L at 'B+'; -- $3.2 million class M at 'B'; -- $2.1 million class N at 'B-'. Fitch does not rate the $5.1 million class O. The rating affirmations are the result of stable performance since Fitch's last rating action. As of the October 2007 distribution date, the pool's aggregate principal balance has decreased 10.6% to $752.8 million compared to $842.2 million at issuance. There are currently no loans in special servicing. Fifteen loans (23.7%) have defeased since issuance. Seven loans (32.3% of the pool) were shadow rated investment grade at issuance, three of which have defeased. All shadow ratings remain investment grade. Dulles Towne Crossing (6.1%) is secured by a 737,558 sf power retail center in Sterling, Virginia. Wal-Mart, Lowe's, and Sam's own their buildings (418,047 sf) and are on ground leases through 2021 with numerous extension options. Additional tenants include: Best Buy, Nordstrom Rack, Bed, Bath & Beyond, Dick's Sporting Goods and T.J. Maxx. As of June 2007, the property was 100% occupied compared to 99% at issuance. Flushing Plaza (3.9%) is secured by a 243,092 sf office building with street level retail in Flushing, New York. Occupancy as of June 2007 was 96% compared to 100% at issuance. Princeton Shopping Center (2.5%) is secured by a 228,679 sf anchored retail center in Princeton, New Jersey. Occupancy as of June 2007 was 98% compared to 99% at issuance. TriQuest Business Center (1.8%) is secured by a 205,060 sf industrial building in Irvine, California. Occupancy as of June 2007 was 94% compared to 93% at issuance. BEAR STEARNS: Moody's Junks Rating on 2004-SD3 Class B Trusts ------------------------------------------------------------- Moody's Investors Service downgraded the ratings of three tranches issued in two separate mortgage transactions. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. The deals being reviewed have experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses and stepdown. The timing of losses coupled with passing of performance triggers has caused the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: Bear Stearns Asset-Backed Securities Trust 2004-SD1 -- Cl. B, Downgraded to B1 from Baa3 Issuer: Bear Stearns Asset Backed Securities Trust 2004-SD3 -- Cl. M-3, Downgraded to Ba1 from Baa2 -- Cl. B, Downgraded to Caa1 from Baa3 BFC SILVERTON: Moody's Junks Ratings on Three Note Classes ---------------------------------------------------------- Moody's Investors Service downgraded ratings of seven classes of notes issued by BFC Silverton, Ltd. and left on review for possible further downgrade ratings of five of these classes of notes. The notes affected by the rating action are: Class Description: Up to $450,000,000 Class A-1 Senior Variable Funding Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Aa1, on review for possible downgrade Class Description: Up to $450,000,000 Class A-2 Senior Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Aa1, on review for possible downgrade Class Description: $75,000,000 Class B-1 Senior Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: A2, on review for possible downgrade Class Description: $75,000,000 Class B-2 Senior Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba2, on review for possible downgrade Class Description: $56,250,000 Class C Senior Floating Rate Notes Due 2046 -- Prior Rating: Ba1, on review for possible downgrade -- Current Rating: Caa3, on review for possible downgrade Class Description: $30,000,000 Class D Floating Rate Deferrable Notes Due 2046 -- Prior Rating: B3, on review for possible downgrade -- Current Rating: Ca Class Description: $26,250,000 Class E Floating Rate Deferrable Notes Due 2046 -- Prior Rating: Caa3, on review for possible downgrade -- Current Rating: Ca The rating actions reflect severe deterioration in the credit quality of the underlying portfolio, as well as the occurrence, as reported by the Trustee on Nov. 13, 2007, of an event of default caused by a failure of the Class A/B Par Value Coverage Ratio to equal or exceed 100%, as required under Section 5.1(d) of the Indenture dated Oct. 31, 2006. BFC Silverton CDO, Ltd is a collateralized debt obligation backed primarily by a portfolio of RMBS and CDO securities. Recent ratings downgrades on the underlying portfolio caused ratings-based haircuts to effect the calculation of overcollateralization. Thus, the Class A/B Par Value Coverage Ratio failed to meet the required level. Upon an event of default in this transaction, certain noteholders are entitled to exercise certain remedies under the indenture. For example a majority of the aggregate outstanding amount of the Class A Notes may direct the sale and liquidation of the collateral when the Class A/B Par Value Coverage Ratio falls below 100 percent. It is not clear at this time whether the Class A Noteholders will choose to exercise this option. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The expected losses of certain tranches may be different, however, depending on the timing and choice of remedy to be pursued by the controlling class. Because of this uncertainty, the Class A-1, Class A-2, Class B-1, Class B-2 and the Class C Notes remain on review for possible downgrade pending the receipt of definitive information. CIGNA CORP: Moody's Affirms (P)Ba1 Rating on Preferred Stock Shelf ------------------------------------------------------------------ Moody's Investors Service affirmed CIGNA Corporation's Baa2 senior unsecured debt rating following the company's announcement to acquire the health care operations of Great-West Life & Annuity Insurance Company. Also affirmed were CIGNA's P-2 commercial paper rating and A2 insurance financial strength ratings of Connecticut General Life Insurance Company and Life Insurance Company of North America. The outlook on the unsecured debt rating and the IFSRs remains positive. Moody's stated that CIGNA will fund the transaction with $1.1 billion in cash and between $400 and $500 million of new long term debt. However, the rating agency noted, the resulting financial leverage ratio at the time the deal closes in 2008 is not expected to vary significantly from its current level. CIGNA will also provide approximately $400 million in capital support for the acquired business to maintain its overall risk based capital ratio at 300% of company action level. It is anticipated that CIGNA will retain approximately $250 million of cash at the parent company. The acquisition will provide CIGNA with an additional 1.5 million members largely located in key geographic areas the company had targeted for growth, namely, particularly the Western regions of the United States. Additionally, the rating agency noted, CIGNA intends to utilize GWLA's operating platform, thus reducing the risk of integration problems. According to Moody's, the positive outlook reflects CIGNA's strong business and financial profile as demonstrated by its continued solid earnings and membership growth. Through the first three quarters of 2007, the company has realized organic commercial membership growth of 4.8%, the largest growth among all the large national healthcare insurers, and a net earnings margin of 6.5%. Although actual outstanding debt of approximately $1.8 billion as of Sept. 30, 2007 is within a reasonable range for the company's size, the company's pension liability and operating leases bring financial leverage to 43% which is higher than what would be expected for the current rating category. However, Moody's anticipates that CIGNA will be addressing its pension liability and reducing this liability over the next several years and expects the company to manage its adjusted debt in the 30% to 40% range. Moody's noted that the leveraged funding of the transaction and the additional goodwill being added to CIGNA's balance sheet is a credit concern. Therefore, as a result of the additional debt being added for the acquisition, the time frame for CIGNA to bring its financial leverage below 40% is expected to be extended. This will likely delay a possible upgrade of the company's ratings, but there is still positive momentum in CIGNA's credit profile. Additionally, the rating agency pointed out that CIGNA's Disability and Life, and International segments have produced consistent results over the last several years and provide diversification to CIGNA's core healthcare business. Moody's also stated that while a hedge program has been implemented to reduce the adverse financial impact from CIGNA's problematic run-off reinsurance segment, the company is still vulnerable to potential losses from this block of business. Moody's indicated that if CIGNA continues to achieve after-tax earnings margins of at least 5%, organic commercial membership growth of at least 4% in 2008, maintains its consolidated RBC in the range of 300% CAL, and reduces its adjusted financial leverage below 40% while maintaining EBIT interest coverage of at least 10 times, the ratings could be upgraded. However, the outlook could be changed back to stable if annual organic membership growth is below 3%, after-tax earnings margins decline below 3%, financial leverage increases above the current 43% level, there is a large acquisition which involves significant integration challenges, or there is adverse reserve development of over 10% of equity with respect to the reinsurance segment. These ratings were affirmed with a positive outlook: * CIGNA Corporation -- senior unsecured debt rating at Baa2; -- provisional senior unsecured debt shelf rating at (P)Baa2; -- provisional subordinated debt shelf rating at (P) Baa3; -- provisional preferred stock shelf rating at (P) Ba1; * Connecticut General Life Insurance Company -- insurance financial strength rating at A2; * The Life Insurance Company of North America -- insurance financial strength rating at A2. This rating was affirmed with a stable outlook: * CIGNA Corporation -- short-term debt rating for commercial paper at Prime-2. CIGNA Corporation, headquartered in Philadelphia, Pennsylvania, provides employee benefits, including health care products and services, and group disability, life and accident insurance throughout the United States. It also provides life, accident, health and expatriate employee benefits insurance coverage in selected international markets, primarily in Asia and Europe. For the first nine months of 2007, the company reported consolidated GAAP revenues of approximately $13.2 billion, shareholders' equity of approximately $4.2 billion, and total enrollment of 10.2 million medical members (excluding Part D membership). Moody's insurance financial strength ratings are opinions of the ability of insurance companies to repay punctually senior policyholder claims and obligations. COLORADO EDUCATIONAL: S&P Lifts Revenue Debt Rating to B+ --------------------------------------------------------- Standard & Poor's Ratings Services raised its rating on Colorado Educational and Cultural Facilities Authority's charter school revenue debt, supported by Renaissance Charter School Building Corp., originally issued for the now defunct Renaissance Charter School, one notch to 'B+' from 'B' due to North Star Academy Charter School's positive enrollment and financial trends. The positive outlook reflects the school's potential for continued enrollment growth and strengthening of its financial position. The rating reflects the new charter school's short operating history; the risk associated with start-up operations, including staffing and enrollment challenges; the risk associated with all charter schools, including the need for multiple charter renewals over the bonds' life; the relatively low cash reserves; a short operating lease; and the potential for additional debt and increased rental payments in the near future. The positive outlook reflects the rating service's expectation that the school will be able to meet its obligations under the lease but that it might face challenges given its start-up nature and the challenges all charter schools face, including enrollment fluctuations and the need for multiple charter renewals through the bonds' life. "The school's continued exhibition of strong demand characteristics, sound financial management, and stable overall operations might warrant a higher rating," said Standard & Poor's credit analyst James Breeding. Given North Star Academy Charter School's start-up nature, a limited financial and operational history is available. State per-pupil funding is currently estimated at $6,500 per pupil. The fiscal 2008 budget indicates total per-pupil revenues of $2.55 million. Additional revenues bring total income to $2.94 million. Budgeted expenditures total $2.89 million: $292,175, or about 10% of operations, of which management allocates for rental payments, which fully cover debt service. A small $45,000 surplus is budgeted. At fiscal year-end 2007, unrestricted net assets totaled $51,231 with an additional $66,280 restricted for emergencies. The unaudited balance sheet shows cash and deposits totaling slightly more than $270,000, or about 40 days' operations. Based on fiscal 2007 preliminary results, net revenues provided debt service coverage of 1x. Preliminary enrollment projections indicate growth to roughly 450 full-time equivalents by 2011 in K-8. Preliminary financial projections through 2012 point to rental payments more than doubling to roughly $685,000, indicating that further capital expenditures are likely because school officials would like to add an additional facility for grade expansion in 2009 or 2010. The rating action affects roughly $3 million of debt outstanding. COLUMBIA AIRCRAFT: Park Electrochemical Cancels Bid for Assets -------------------------------------------------------------- Park Electrochemical Corp. had discontinued its participation in the bidding for certain of the assets and business of Columbia Aircraft Manufacturing Corporation in an auction conducted in the United States Bankruptcy Court for the District of Oregon in Portland, Oregon on Nov. 27, 2007. Park had submitted an initial bid for certain of the assets and business of Columbia on Nov. 20, 2007 after conducting extensive due diligence at Columbia in Bend, Oregon and elsewhere. Park participated in the auction in the Bankruptcy Court in Portland on Nov. 27, 2007 but chose to discontinue its participation in the auction bidding process. Park has incurred approximately $500,000 in out-of-pocket expenses relating to its due diligence efforts, all of which will be expensed in Park's third quarter ended Nov. 25, 2007. "We would like to thank the employees of Columbia Aircraft Manufacturing for all of their help and assistance relating to our due diligence efforts," Brian Shore, Park's President and CEO, said. "We wish the employees the best of luck in the future. In our opinion, the business will be in good hands with its new owner. I would also like to take this opportunity to thank Lance Neibauer, the very talented designer of the Columbia aircraft models, for his help in connection with our due diligence efforts." About Park Electrochemical Headquartered in Melville, New York, Park Electrochemical Corp. -- http://www.parkelectro.com/-- develops and manufactures high- technology digital and RF/microwave printed circuit materials (the Nelco(R) product line) and advanced composite materials (the Nelcote(TM) product line) principally for the telecommunications and internet infrastructure, high-end computing and aerospace markets. Park focuses on the general aviation segment of the aerospace market. Park's core capabilities are in the areas of polymer chemistry formulation and coating technology. The company's manufacturing facilities are located in Singapore, China, France, Connecticut, New York, Arizona and California. About Columbia Aircraft Headquartered in Bend, Oregon, Columbia Aircraft Manufacturing Corporation -- http://www.flycolumbia.com/-- manufactures a variety of all-composite aircraft, including the Columbia 400 and employs approximately 440 people. The company filed for Chapter 11 protection on Sept. 24, 2007 (Bankr. D. Ore. Case No. 07-33850). Leon Simson, Esq., Albert N. Kennedy, Esq., and Timothy J. Conway, Esq., at Tonkon Torp LLP represent the Debtor in its restructuring efforts. James Ray Streinz, Esq., and Johnston A. Mitchell, Esq., at McEwen Gisvold LLP serve as counsel to the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed estimated assets and liabilities of $1 million to $100 million. The Debtor's list of its 20 largest unsecured creditors showed total aggregate claims of more than $50 million. COLUMBIA AIR: Cessna Aircraft Wins Auction with $26.4 Million Bid ----------------------------------------------------------------- Cessna Aircraft Company of Textron Inc., was the successful bidder for select assets of Columbia Aircraft Manufacturing Company. The bid of $26.4 million was the high bid in The United States Bankruptcy Court for the District of Oregon. "This is a significant day as it brings together two top aircraft design and production companies to offer the global general aviation community the widest range of propeller aircraft, along with world-class product support, all under the Cessna brand -- one of the most trusted names in aviation," Jack. J. Pelton, Cessna chairman, president and CEO, said. "I would like to thank the 400-plus Columbia employees for their continued hard work and dedication during the bankruptcy process. We look forward to welcoming them to the Cessna family." "The Columbia models are a good fit with our existing product line," Mr. Pelton said. "We look forward to providing existing Columbia owners with improved levels of service and support and introducing new customers to these outstanding aircraft." "We plan to make significant investments in Bend, in people and operations, to bolster customer satisfaction and business profitability," Mr. Pelton said. "We will continue to improve quality, reliability and performance as we strive to deliver customer value and fulfill our commitments." Once the transaction is completed, which is expected to occur by Dec. 4, 2007, the Bend operation will take on the Cessna name and be one of six Cessna manufacturing facilities. Cessna intends to rename the current Columbia product line to become the Cessna 350 and the Cessna 400. Cessna and its network of authorized dealers and service centers plan to integrate sales and support of the former Columbia aircraft, and Cessna Parts Distribution is expected to become the source for parts. Cessna also intends to develop direct communications with current owners. "We feel it's very important for Cessna customers to enjoy a seamless, high-quality experience throughout our entire product line -- from the SkyCatcher all the way up to the Citation X. It only makes sense that we fully embrace these two new aircraft and their owners as members of the Cessna family," Mr. Pelton said. "Current Columbia aircraft owners should feel very secure knowing their investment will now be supported through our vast global customer sales and service network." About Cessna Aircraft Company Headquartered in Wichita, Kansas, Cessna Aircraft Company \u2013- http://www.cessna.com/-- is one of the most famous names in small planes. A subsidiary of Textron, the company manufactures business jets, utility turboprops, and small single-engine planes. Cessna is also a maker of business jets; it makes nine variations of its popular Citation jet. Its utility turboprop plane, the Caravan, has freight, bush, amphibious, and commercial (small connecting flights) applications. Cessna's single-engine planes are typically used for personal and small-business purposes. Cessna also offers fractional ownership programs for its business jets. About Columbia Aircraft Manufacturing Headquartered in Bend, Oregon, Columbia Aircraft Manufacturing Corporation -- http://www.flycolumbia.com/-- manufactures a variety of all-composite aircraft, including the Columbia 400 and employs approximately 440 people. The company filed for Chapter 11 protection on Sept. 24, 2007 (Bankr. D. Ore. Case No. 07-33850). Leon Simson, Esq., Albert N. Kennedy, Esq., and Timothy J. Conway, Esq., at Tonkon Torp LLP represent the Debtor in its restructuring efforts. James Ray Streinz, Esq., and Johnston A. Mitchell, Esq., at McEwen Gisvold LLP serve as counsel to the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed estimated assets and liabilities of $1 million to $100 million. The Debtor's list of its 20 largest unsecured creditors showed total aggregate claims of more than $50 million. COMPASS DIVERSIFIED: Offers Shareholders Reinvestment Plan ---------------------------------------------------------- Compass Diversified Holdings is offering a Distribution Reinvestment Plan to current and prospective shareholders. The Plan permits shareholders to acquire additional shares of CODI automatically with quarterly distributions. The Plan is administered by The Bank of New York. To enroll in the Plan, request an enrollment form or obtain a hard copy of the Plan prospectus, contact The Bank of New York toll-free at 1-877- 296-3711. Headquartered in Westport, Connecticut, Compass Diversified Holdings --www.compassdiversifiedholdings.com/ -- (Nasdaq GS: CODI) is a Delaware statutory trust that was formed on Nov. 18, 2005, to acquire and manage a group of middle market businesses that are headquartered in North America. CODI provides public investors with an opportunity to participate in the ownership and growth of companies which have historically been owned by private equity firms, wealthy individuals or families. Compass Group Diversified Holdings LLC, a Delaware limited liability company, was also formed on Nov. 18, 2005. In accordance with the Trust Agreement, Compass Diversified Holdings is the sole owner of 100% of the trust's Interests of Compass Group Diversified Holdings LLC. Compass Group Diversified Holdings LLC is the operating entity with a board of directors and other corporate governance responsibilities, similar to that of a Delaware corporation. Compass Diversified Holdings is managed by Compass Group Management LLC, which was established in 1998 as a private equity manager for an offshore philanthropic foundation established by J. Torben Karlshoej, the late founder of Teekay Shipping Corporation. * * * As reported in the Troubled Company Reporter on Nov. 9, 2007, Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to Compass Group Diversified Holdings LLC. The outlook is stable. At the same time, S&P assigned bank loan and recovery ratings to Compass's $200 million first-lien term loan due 2013. The loan is rated 'BB-' with a recovery rating of '4', indicating S&P's expectation of average (30%-50%) recovery in the event of a payment default. COUNTRYWIDE HOME: Moody's Junks Ratings on Two Loan Classes ----------------------------------------------------------- Moody's Investors Service has downgraded the ratings of four tranches issued in two separate mortgage transactions. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. The deals being reviewed have experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses and stepdown. The timing of losses coupled with passing of performance triggers has caused the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: Countrywide Home Loan Trust 2004-SD1 -- Cl. B-1, Downgraded to Ba1 from Baa1 -- Cl. B-2, Downgraded to Caa1 from Baa2 Issuer: Countrywide Home Loan Trust 2004-SD2 -- Cl. B-1, Downgraded to Ba3 from Baa2 -- Cl. B-2, Downgraded to Ca from Baa3 CREDIT SUISSE: Fitch Lowers Ratings on $209.9MM Transactions ------------------------------------------------------------ Fitch Ratings has taken these rating actions on four Credit Suisse First Boston Home Equity Asset Trust transactions. Affirmations total $1.6 billion and downgrades total $209.9 million. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: CSFB HEAT 2005-2 -- $81.7 million class A affirmed at 'AAA' (BL: 82.18, LCR: 7.12); -- $38.5 million class M-1 affirmed at 'AA+' (BL: 68.63, LCR: 5.95); -- $35 million class M-2 affirmed at 'AA' (BL: 56.81, LCR: 4.92); -- $24.1 million class M-3 affirmed at 'AA-' (BL: 48.61, LCR: 4.21); -- $20.1 million class M-4 affirmed at 'A+' (BL: 25.49, LCR: 2.21); -- $20.1 million class M-5 affirmed at 'A' (BL: 21.88, LCR: 1.9); -- $16.1 million class M-6 affirmed at 'A-' (BL: 19.12, LCR: 1.66); -- $16.1 million class B-1 affirmed at 'BBB+' (BL: 16.35, LCR: 1.42); -- $14.3 million class B-2 affirmed at 'BBB' (BL: 13.92, LCR: 1.21); -- $8.6 million class B-3 downgraded to 'BB' from 'BBB-' (BL: 12.40, LCR: 1.07); -- $9.7 million class B-4 downgraded to 'BB' from 'BB+' (BL: 11.19, LCR: 0.97). Deal Summary -- Originators: Various Originators -- 60+ day Delinquency: 29.07%, -- Realized Losses to date (% of Original Balance): 1.01%; -- Expected Remaining Losses (% of Current Balance): 11.54%; -- Cumulative Expected Losses (% of Original Balance): 4.0 %. CSFB HEAT 2005-6 -- $187.7 million class A affirmed at 'AAA' (BL: 55.32, LCR: 3.7); -- $29.6 million class M-1 affirmed at 'AA+' (BL: 44.4, LCR: 2.97); -- $26.4 million class M-2 affirmed at 'AA+' (BL: 38.74, LCR: 2.59); -- $15.6 million class M-3 affirmed at 'AA' (BL: 34.31, LCR: 2.29); -- $14.4 million class M-4 affirmed at 'AA-' (BL: 30.20, LCR: 2.02); -- $9.6 million class M-5 affirmed at 'AA-' (BL: 27.44, LCR: 1.84); -- $12.8 million class M-6 affirmed at 'A' (BL: 23.72, LCR: 1.59); -- $10.4 million class M-7 downgraded to 'BBB+' from 'A-' (BL: 20.62, LCR: 1.38); -- $8.8 million class M-8 downgraded to 'BBB' from 'BBB+' (BL: 18.00, LCR: 1.2); -- $7.2 million class B-1 downgraded to 'B' from 'BBB+' (BL: 12.61, LCR: 0.84); -- $7.6 million class B-2 downgraded to 'CC/DR3' from 'BBB'; -- $7.2 million class B-3 downgraded to 'CC/DR3' from 'BB+'; -- $4 million class B-4 downgraded to 'CC/DR3' from 'BB+', removed from Rating Watch Negative. Deal Summary -- Originators: Various Originators -- 60+ day Delinquency: 24.8%; -- Realized Losses to date (% of Original Balance): 1.13%; -- Expected Remaining Losses (% of Current Balance): 14.95%; -- Cumulative Expected Losses (% of Original Balance): 7.69%. CSFB HEAT 2005-7 -- $274.5 million class A affirmed at 'AAA' (BL: 51.61, LCR: 3.27); -- $36.5 million class M-1 affirmed at 'AA+' (BL: 40.58, LCR: 2.57); -- $33 million class M-2 affirmed at 'AA' (BL: 36.41, LCR: 2.3); -- $21 million class M-3 affirmed at 'AA-' (BL: 32.26, LCR: 2.04); -- $16 million class M-4 affirmed at 'A+' (BL: 28.89, LCR: 1.83); -- $16.5 million class M-5 affirmed at 'A' (BL: 25.40, LCR: 1.61); -- $14.5 million class M-6 affirmed at 'A-' (BL: 22.29, LCR: 1.41); -- $14.5 million class M-7 downgraded to 'BBB' from 'BBB+' (BL: 19.11, LCR: 1.21); -- $10 million class B-1 downgraded to 'B' from 'BBB' (BL: 13.61, LCR: 0.86); -- $8.5 million class B-2 downgraded to 'B' from 'BBB' (BL: 12.20, LCR: 0.77), removed from Rating Watch Negative; -- $6 million class B-3 downgraded to 'C/DR4' from 'BBB-', removed from Rating Watch Negative; -- $10 million class B-4 downgraded to 'C/DR5' from 'B+'; -- $5 million class B-5 downgraded to 'C/DR5' from 'B+'. Deal Summary -- Originators: Various Originators -- 60+ day Delinquency: 27.96%; -- Realized Losses to date (% of Original Balance): 1.14%; -- Expected Remaining Losses (% of Current Balance): 15.80%; -- Cumulative Expected Losses (% of Original Balance): 8.68%. CSFB HEAT 2005-8 -- $451.1 million class A affirmed at 'AAA' (BL: 51.05, LCR: 3.18); -- $55.5 million class M-1 affirmed at 'AA+' (BL: 41.42, LCR: 2.58); -- $51 million class M-2 affirmed at 'AA' (BL: 36.7, LCR: 2.28); -- $33 million class M-3 affirmed at 'AA-' (BL: 32.44, LCR: 2.02); -- $24 million class M-4 affirmed at 'A+' (BL: 29.29, LCR: 1.82); -- $24.7 million class M-5 affirmed at 'A' (BL: 26.03, LCR: 1.62); -- $21 million class M-6 affirmed at 'A-' (BL: 23.21, LCR: 1.44); -- $20.2 million class M-7 downgraded to 'BBB' from 'BBB+' (BL: 20.42, LCR: 1.27); -- $15 million class M-8 downgraded to 'BBB-' from 'BBB+' (BL: 18.34, LCR: 1.14); -- $12.7 million class B-1 downgraded to 'BB' from 'BBB' (BL: 16.51, LCR: 1.03); -- $7.5 million class B-2 downgraded to 'B' from 'BBB' (BL: 14.26, LCR: 0.89), and removed from Rating Watch Negative; -- $15 million class B-3 downgraded to 'C/DR5' from 'BBB-', and removed from Rating Watch Negative; -- $11.2 million class B-4 downgraded to 'C/DR5' from 'BB'; -- $10.5 million class B-5 downgraded to 'C/DR5' from 'B+'. Deal Summary -- Originators: Various Originators -- 60+ day Delinquency: 25.6%; -- Realized Losses to date (% of Original Balance): 1.20%; -- Expected Remaining Losses (% of Current Balance): 16.07%; -- Cumulative Expected Losses (% of Original Balance): 10.01%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. CREDIT SUISSE: Fitch Lowers Rating on Class M-3 Certs. to B ----------------------------------------------------------- Fitch Ratings has taken rating action on Credit Suisse First Boston Home Equity Asset Trust transactions: CSFB HEAT, series 2002-5 -- Class M-1 affirmed at 'AA'; -- Class M-2 downgraded to 'BBB' from 'A'; -- Class B-1 downgraded to 'CCC/DR1' from 'B+'. CSFB HEAT, series 2003-2 -- Class A-IO affirmed at 'AAA'; -- Class M-1 affirmed at 'AA'; -- Class M-2 downgraded to 'BBB' from 'A-'; -- Class M-3 downgraded to 'B' from 'BBB-'; -- Class B-1 downgraded to 'CCC/DR1' from 'B'; -- Class B-2 remains at 'C', and the DR is revised to 'DR6' from 'DR5'. The collateral of the above transactions consists of first and second lien fixed-rate and adjustable-rate subprime mortgage loans. All of the mortgage loans were purchased by an affiliate of Credit Suisse First Boston Mortgage Securities Corp. from various sellers in secondary market transactions. The affirmations affect approximately $57.1 million in outstanding certificates and reflect adequate relationships of credit enhancement to future loss expectations. The classes with negative actions reflect the deterioration in the relationship of CE to future loss expectations and affect $17.5 million in outstanding certificates. The overcollateralization of series 2002-5 has been declining over the past year and is currently providing 1.99% in CE to the B1 bond. The OC of series 2003-2 been completely exhausted for the past five months. As of the October 2007 remittance period, 60+ delinquencies for series 2002-5 and 2003-2 is 23.51% and 32.55%, respectively. Furthermore, the pool factors are less than 10% which increases the chance of adverse selection to the trusts. The mortgage loans are being serviced by Select Portfolio Servicing, Inc., rated 'RPS2+' by Fitch Ratings. CRESTED CORP: Completes Merger Deal with U.S. Energy ---------------------------------------------------- Crested Corp. shareholders voted in favor of the Agreement and Plan of Merger to merge into U.S. Energy Corp. The merger was completed on Nov. 27, 2007, and Crested has been merged into USEG pursuant to Colorado and Wyoming law. As a result, Crested has ceased to exist and all outstanding shares of Crested have been converted into the right to receive USEG shares, and Crested will terminate its obligations to file further information with the SEC. In accordance with the agreement and USEG's effective Form S-4 registration statement for the transaction, USEG will issue up to 2,876,188 shares of common stock to all former shareholders of Crested, on an exchange ratio of 1 USE share for every 2 Crested shares. Computershare Trust Company, transfer agent for USE and the exchange agent for the merger consideration, will issue USE shares to the former Crested shareholders in due course as the Crested shares are presented for exchange. USEG shares issued to the former minority shareholders of Crested will not be restricted. On a pro forma basis, USEG will have 23,963,584 shares outstanding. "The merger of Crested Corp. into U.S. Energy Corp. presents a significant milestone in the company's history," Keith Larsen, CEO of U.S. Energy Corp. said. "Management's goal is to streamline, simplify and make the company more transparent while building shareholder value." "With the approval of the merger, U.S. Energy Corp. now owns 100% of all assets previously jointly held jointly with Crested Corp.," Mr. Larsen added. "This includes the world-class Lucky Jack molybdenum deposit located in west central Colorado that is being developed through our venture with Kobex Resources Ltd." About US Energy Corp. Headquartered in Riverton, Wyoming, US Energy corp. -- http://www.usnrg.com/-- is a diversified natural resource company with interests in molybdenum, gold and oil & gas. About Crested Corp. Headquartered in Riverton, Wyoming, Crested Corp. (OTC BB: CBAG) develops and leases mineral properties. The company primarily focuses on hard rock minerals, including lead, zinc, silver, molybdenum, gold, uranium, and oil and gas properties. It also engages in the production of petroleum properties and marketing of minerals through equity investees. Going Concern Doubt Moss Adams LLP cited several factors that raise substantial doubt about the ability of Crested Corp. to continue as a going concern after auditing the company's financial statements as of Dec. 31, 2006. The factors were the company's significant losses from operations and working capital deficit of $3,730,800 as of Dec. 31, 2006. Moss Adams also stated that a substantial portion of Crested's obligation is owed to an affiliated entity. CROWN CASTLE: Fitch Holds 'BB' Rating on $83MM Class G Notes ------------------------------------------------------------ Fitch Ratings has affirmed these classes of Crown Castle, senior secured tower revenue notes, series 2005-1: -- $948,460,000 class A-FX at 'AAA'; -- $250,000,000 class A-FL at 'AAA'; -- $233,845,000 class B at 'AA'; -- $233,845,000 class C at 'A'; -- $233,850,000 class D at 'BBB'. Fitch Ratings has also affirmed these classes of Crown Castle, senior secured tower revenue notes, series 2006-1: -- $453,540,000 class A-FX at 'AAA'; -- $170,000,000 class A-FL at 'AAA'; -- $150,155,000 class B at 'AA'; -- $150,155,000 class C at 'A'; -- $150,150,000 class D at 'BBB'; -- $144,000,000 class E at 'BBB-'; -- $240,000,000 class F at 'BB+'; -- $83,000,000 class G at 'BB'. The affirmations are due to the stable performance of the collateral. The Crown Castle, series 2005-1 closed on June 8, 2005 and was secured by 10,578 wireless communication sites. The Crown Castle, series 2006-1 represents an additional issuance with the contribution of 949 additional sites. As of September 2007, the collateral pool included 11,554 wireless communication sites owned, leased, or managed by the borrower. The notes issued by both transactions, which are secured by the same pool, are pari passu among like rated classes. As of the October 2007 distribution date, the aggregate principal balance of the notes remained unchanged at $3.45 billion since issuance. Notes from both issuances are interest only for the entire five- year period. As part of the review, Fitch analyzed the management report dated Sept. 30, 2007 that was provided by the servicer, Midland Loan Services. As of Sept. 30, 2007, aggregate annualized run rate revenue increased 4.2% to $686.9 million from $644.5 million at issuance. Over the same time period, the Fitch adjusted net cash flow increased 3% since issuance. The tenant type concentration is stable. As of Sept. 30, 2007, total revenue contributed by telephony tenants was 94.7% compared to 95.9% at issuance. CROWN HOLDINGS: Completes Share Repurchase Deal with BNP Paribas ---------------------------------------------------------------- Crown Holdings Inc. has completed its accelerated share repurchase agreement with BNP Paribas. Pursuant to the agreement, the company purchased 4,234,077 shares of its common stock for $100 million. On Aug. 27, 2007, Crown Holdings has entered into a definitive agreement with BNP Paribas to purchase shares of its common stock for approximately $100 million under an accelerated share repurchase program. Pursuant to the agreement, the company has purchased 4,088,068 shares immediately from BNP Paribas and may potentially receive additional shares upon completion of the transaction. The final number of shares to be repurchased will be based on the company's volume-weighted average stock price during the term of the transaction. To date in 2007, the company has purchased 4,974,892 shares for $118 million. About Crown Holdings Inc. Based in Philadelphia, Pennsylvania, Crown Holdings Inc. (NYSE: CCK) -- http://www.crowncork.com/-- through its affiliated companies, supplies packaging products to consumer marketing companies around the world. In Latin America, the company has operations in Mexico, and in South and Central America. The company also maintains operations in Europe, particularly in the United Kingdom and France. In the Asia-Pacific region, the company has an office in Singapore. Crown Holdings, Inc., through its subsidiaries, is a leading supplier of packaging products to consumer marketing companies around the world. The company's consolidated balance sheet at Sept. 30, 2007, showed $6.949 billion in total assets, $7.335 billion in total liabilities, resulting in a $386 million total shareholders' deficit. CSFB 2004-CF1: Moody's Lowers Rating on Class B Loan to B3 ---------------------------------------------------------- Moody's Investors Service has downgraded the rating of one tranche issued in the CSFB 2004-CF1 mortgage transaction. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. The deal being reviewed has seen the amount of available credit enhancement reduced from losses and step-down. The timing of losses coupled with passing of performance triggers has caused the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: CSFB 2004-CF1 -- Cl. B; Downgraded to B3 from Baa2 CYRUS REINSURANCE: Moody's Rates $65MM Sr. Secured Loan at Ba1 -------------------------------------------------------------- Moody's has assigned these ratings to three proposed bank loans of Cyrus Reinsurance II Limited : Ba1 to the $65 million senior secured term loan, Ba3 to the $20 million senior subordinated secured term loan, and B3 to the $20 million junior subordinated secured term loan. "Cyrus Re II is a type of limited purpose reinsurer that is commonly referred to as a 'sidecar'," explains senior analyst Kevin Lee. "The sidecar will be capitalized with $35 million of equity and $105 million of term loans (75% debt, 25% equity)," notes Mr. Lee. "The term loans are arrayed in tranches, each having a different probability of attachment, expected loss, and priority with respect to interest and principal payments, hence the difference in ratings." Cyrus Re II is expected to provide collateralized quota share coverage exclusively to two subsidiaries of XL Capital Ltd -- XL Re Ltd (Aa3/stable) and XL Re Europe Ltd. If the quota share agreement is executed, the Ceding Companies will pass on (cede) -- and Cyrus Re II will assume -- 10% of the premiums and losses on a future portfolio of non-proportional catastrophe reinsurance contracts. Those underlying contracts will be written in 2008 and will cover natural catastrophe risks throughout the world. The future portfolio is expected to be similar to the Ceding Companies' existing portfolio as client retention tends to be relatively high. This quota share agreement, if executed, will be distinct and separate from the Ceding Companies' previous sidecar, Cyrus Reinsurance Limited. The ratings for the term loans are supported by Moody's financial modeling to determine both the probability of default and expected loss to lenders. The most important inputs into the financial model are the annual aggregate probability loss curve derived by the Ceding Companies, premium assumptions, and investment income assumptions. Moody's applied stress factors and performed sensitivity analysis on all three inputs. The PDs and ELs from our simulation runs were then compared to Moody's idealized default rates and expected loss rates over a weighted average life of about 1.7 years for each loan. Finally, the assigned ratings also reflect, in our opinion, sufficient alignment of interests between stakeholders. Key rating factors include: 1) Model Risk: Catastrophe modeling error is the most important risk factor. The Ceding Companies modeled their existing portfolio using RMS 6.0 peril models that are common in the industry. Parameter uncertainty, the quality of input data, and how the models are used can all contribute to modeling error. In general, the current portfolio is diversified with respect to geography and layers of coverage. A majority of the current portfolio consists of personal lines and standard commercial risks which generally offer more homogeneous data than industrial and surplus lines risks. The Ceding Companies receive exposure data from clients or brokers for nearly all underlying contracts, allowing the Ceding Companies to duplicate the modeling work with all discretionary settings applied. One notable exception is assumed retrocession business (2.5% of current portfolio limits), for which exposure data isn't available, but is nonetheless modeled by the Ceding Companies. Many of the covered perils are modeled using RMS 6.0 peril models. European Flood, European Earthquake and attritional losses are modeled using in-house curve fitting methods. Moody's has applied a moderate load to the Base Curve to account for these elements: 1) potential deviations from the expected portfolio; 2) difficult-to-model classes of business such as industrial and surplus lines risks (estimated to be roughly 20% of current portfolio limits); 3) non-modeled contract elements such as loss adjustment expenses and extra-contractual obligations; 4) inherent uncertainty in peril modeling especially as it relates to perils like earthquakes where little historical data is available for model calibration; and 5) a small load for perils that are not modeled by any methods such as volcanic eruption, meteorite impact, tsunami, domestic terrorism and industrial/residential conflagration. 2) Defaults are Sensitive to Rate and Investment Income Assumptions: Moody's analysis suggests that default rates and expected loss rates to debt holders are sensitive to assumptions about premium rates and investment yields. This is fairly intuitive given that equity capital is thin (75% debt, 25% equity) and tranche attachment points are relatively low. That is to say, investors will have to rely more on premium income and investment income to defray losses. Premium rates in 2008 are uncertain. In Moody's financial modeling, Moody's have modeled for the possibility that rates may fall up to 20% from their 2007 levels. Additionally, Moody's have modeled investment returns stochastically. 3) Alignment of Interests: In Moody's opinion, there is adequate alignment of interests between stakeholders given that the Ceding Companies will retain 90% of premiums and losses with ample skin in the game. Additionally, any reinsurance purchased by the Ceding Companies for its retained portfolio would inure to the benefit of the sidecar. Dividend distributions to shareholders are prohibited, mitigating some of our concerns about the highly levered capital structure. 4) Cash Waterfall: At each quarterly interest payment date, trust assets that exceed loss reserves and a reserve cushion can be released to pay interest. However, capacity must exist to fully pay all remaining scheduled interest and principal on the senior secured term loans before any trust capital can be released to pay interest and principal on the senior subordinated or junior subordinated loans. The same rule applies to the priority of payments between the senior subordinated and junior subordinated loans. This cash waterfall is reflected in Moody's financial modeling. These ratings have been assigned with a stable outlook: * Cyrus Reinsurance II Limited -- $65 million senior secured term loan at Ba1; * Cyrus Reinsurance II Limited -- $20 million senior subordinated secured term loan at Ba3; * Cyrus Reinsurance II Limited -- $20 million junior subordinated secured term loan at B3. Cyrus Reinsurance II Holdings SPC is majority-owned by investment funds affiliated with Highfields Capital Management LP. Its subsidiary, Cyrus Reinsurance II Limited, is a Class 3 Bermuda reinsurer that is expected to enter into a collateralized quota share reinsurance treaty with XL Re Ltd and XL Re Europe Ltd. The treaty will cover policies incepting between Jan. 1, 2008 and Jul. 1, 2008. Lenders will be at risk for events occurring between Jan. 1, 2008 and Jul. 1, 2009. Capital cannot be returned to investors before September 1, 2009 and equity capital cannot be returned to shareholders until all three loans have been repaid. DANKA BUSINESS: Delists American Depositary Shares from Nasdaq -------------------------------------------------------------- Danka Business Systems PLC's board of directors has determined to voluntarily delist its American Depositary Shares from the Nasdaq Capital Market and move them to the OTC Bulletin Board. The company's ordinary shares are unaffected by this action and will continue to trade on the London Stock Exchange. "To be clear, our primary listing is in London and remains unchanged," Danka chairman and chief executive officer A.D. Frazier stated. "As such, this decision does not impact the company's financial status, nor will it have an effect on the way we conduct our business or on the nature of our existing and future customer and partner relationships. This has been a year of transformation for Danka, highlighted just last week with the signing of two separate partnership initiatives designed to further reinforce the company's independent leadership position in the enterprise imaging marketplace." The board at this conclusion subsequent to a deficiency notification from the Nasdaq Listing Qualifications staff received on Nov. 20, 2007, stating that the company was not in compliance with the stockholders' equity/market value of listed securities/net income continued listing requirement set forth in Nasdaq Marketplace Rule 4310(c)(3). Under Nasdaq rules, if the company did not submit a plan of compliance on or before Dec. 5, 2007, and did not regain compliance with the market value of listed securities requirement for a minimum of 10 consecutive business days within 30 calendar days from the date of the deficiency notification, Nasdaq Staff would have provided written notification to Danka that its ADSs would be delisted. At that time, the company would have been permitted to appeal the Nasdaq Staff determination to a Nasdaq Listing Qualifications Panel. The board determined, after careful consideration of various business, legal, shareholder and compliance aspects of this matter, not to submit a plan of compliance and, instead, that voluntarily delisting and moving the company's ADSs to the OTC Bulletin Board is in the overall best interests of the Company's shareholders. These factors, among others, were considered by the board in taking this action: -- the reduction in costs associated with maintaining two separate exchange listings; -- that the London Stock Exchange will continue to be the company's primary market as it is not necessary to maintain two separate exchange listings; -- the continued availability of quotations and last sale information in the company's ADSs on the OTC Bulletin Board; and -- the fact that the company will remain a reporting company for SEC purposes and will continue to comply with all reporting requirements. The company received a letter on Aug. 29, 2007, from Nasdaq indicating that the company was not in compliance with the continued listing requirement for minimum bid price on The Nasdaq Capital Market because the bid price of Danka's ADSs had closed below the minimum $1 per share requirement for more than 30 consecutive days. The OTC Bulletin Board is neither a "listed" market nor a "stock exchange." Instead, it operates as a voluntary electronic quotation system that allows market makers to enter quotations in a security and offers investors real-time access to quotes, last- sale prices and volume information in over-the-counter equities. The company will file an application with the Securities and Exchange Commission on Form 25 to voluntarily delist its ADSs from the Nasdaq Capital Market. The delisting becomes effective ten days after the Form 25 is filed. The Form 25 is expected to be filed on or about Dec. 7, 2007. About Danka Business Systems plc Based in London, England, Danka Business Systems PLC (LON:DNK) -- http://www.danka.com/-- is a provider of document solutions, including office imaging equipment, software, support, and related services and supplies in the United States. It offers office imaging products, services, supplies and solutions, including digital and color copiers, digital and color multifunction peripherals printers, facsimile machines and software. It also provides contract services, including professional and consulting services, maintenance, supplies, leasing arrangements, technical support and training, collectively referred to as Danka Document Services. At Sept. 30, 2007, the company's balance sheet showed total assets of $241.5 million and total liabilities of $588.8 million, resulting to a shareholders' deficit of $347.3 million. DECORDOVA/PERMIAN: Fitch Assigns 'B/RR4' Rating on 7.48% Bonds -------------------------------------------------------------- Fitch has assigned a 'B/RR4' rating to the 7.48% Decordova/Permian Basin secured facility bonds that mature Jan. 1, 2017. In addition, Fitch assigns a 'B/RR4' rating to the 7.46% Morgan Creek/Permian Basin secured facility bonds that mature Jan. 1, 2015. The Rating Outlook of the primary lease obligor Texas Competitive Electric Holding (TCEH; Issuer Default Rating 'B'), and the co-obligor Energy Future Competitive Holding (EFCH; IDR 'B) are Stable. Both series of bonds are secured by certain peaking generation units, the related ground leases and rights under the leases. The facilities are located in Texas. The Decordova/Permian bonds are secured by four Decordova peaking units with total capacity of 260 megawatts and two Permian Basin units with 130MW of capacity. The Decordova and Permian units started commercial operation in 1989. The Morgan Creek/Permian Basin bonds are secured by nine peaking units with 585MW of total capacity. The six Morgan Creek units and three Permian Basin units were placed into service in 1988 and 1987, respectively. The plants are maintained to utility standards and there have been no significant operating issues. There are no plans to retire or mothball the units. Fitch valued the peaking unit collateral packages in a stress scenario to establish estimates for recovery value to position the ratings of the secured facility bonds relative to the IDR of TCEH, which includes an average recovery assumption of 30%-50%. Fitch used its proprietary power pricing model to calculate the net present value of future cash flows from the units based on a single dispatch and price scenario and on an alternate scenario that uses the observed volatility of power prices to estimate the option value of the facilities, with cash flows discounted at a 10% discount rate. Fitch notes that it is more challenging to value peaking units than other power generation assets that have more predictable usage. Fitch accorded relatively less weight to future option value. In Fitch's opinion, the peaking units have average recovery prospects and are thus rated at the same 'B' level as the IDR of the lessee and co-obligor. DEERFIELD TRIARC: Moody's Cuts Corporate Family Rating to Ba3 ------------------------------------------------------------- Moody's Investors Service has downgraded Deerfield Triarc Capital Corp's corporate family rating to Ba3, from Ba2. Concurrently, Moody's has withdrawn provisional (P)B1 senior secured term loan rating assigned to the REIT's external manager Deerfield & Company LLC. Rating outlook is negative. According to Moody's, these rating actions reflect the REIT's lack of progress in consummating a merger with its external advisor, Deerfield & Company LLC, as well as deterioration in the company's earnings and financial profile due to stress in the structured finance markets. The negative rating outlook reflects uncertainty associated with the REIT's earnings trajectory, asset quality of its alternative asset portfolio and overall liquidity position due to the continuing dislocations in the credit markets. Deerfield's Ba3 corporate family rating continues to reflect the REITs diverse portfolio, which includes high quality, highly liquid mortgage securities. Sound risk management and adequate liquidity are underpinnings of the ratings. Moody's stated that a return to a stable outlook would be contingent upon the REIT's ability to return to profitability as demonstrated by two consecutive quarters of positive earnings, stabilization in the asset quality of its alternative asset portfolio and preservation of the liquidity cushion maintained to protect its RMBS portfolio. Conversely, a rating downgrade would most likely result from further sustained deterioration in earnings, additional decline in the asset quality of the REIT's alternative asset portfolio, and pressure on its liquidity position. This rating was downgraded: * Deerfield Triarc Capital Corp. -- Corporate family rating to Ba3, from Ba2. This rating will be withdrawn: * Deerfield & Company LLC -- Senior secured term loan at (P)B1. Deerfield Triarc Capital Corp. [NYSE: DFR] is a diversified financial company, structured as a REIT, that invests in single- family mortgage securities and various other asset classes. DENNY'S INC: Credit Repayment Cues S&P to Revise Rating to BB ------------------------------------------------------------- Standard & Poor's Ratings Services revised its bank loan rating on Denny's Inc.'s $350 million bank facility to 'BB', two notches above the corporate credit rating on parent Denny's Corp. (B+/Stable/--), from 'BB-'. S&P have also revised the recovery rating on this debt issue from '2' to '1', reflecting our expectation for very high (90%-100%) recovery of principal in the event of a payment default. "The action reflects a meaningful repayment of the credit facility using proceeds from asset sales as well as free cash flow," said Standard & Poor's credit analyst Diane Shand. For the year to date Sept. 26, 2007, the company has repaid about $45.2 million of debt. As of Sept. 26, 2007, the outstanding amount under the total credit facility totaled about $245 million. Concurrently, S&P affirmed the 'B+' corporate credit rating on Denny's Corp. and the 'B-' rating on the company's senior unsecured notes. DOLE FOOD: Poor Operating Results Cue S&P's Negative Watch ---------------------------------------------------------- Standard & Poor's Ratings Services placed its corporate credit and other ratings on Westlake Village, California-based Dole Food Co. Inc. on CreditWatch with negative implications, meaning that the ratings could be lowered or affirmed following the completion of S&P's review. Total debt outstanding at the company was about $2.4 billion as of Oct. 6, 2007. "The CreditWatch placement follows third-quarter operating results and resulting credit measures that did not meet our prior expectations," said Standard & Poor's credit analyst Alison Sullivan. These expectations included reducing leverage to closer to 8x by the end of the third quarter in order to reach 7.0x-7.5x by the end of fiscal 2007. For the 12 months ended Oct. 6, 2007, leverage was 8.8x. "While there are no near-term liquidity concerns and performance has improved modestly over a difficult 2006, credit measures have not been restored to levels previously expected," said Ms. Sullivan. Year-to-date sales grew 12.6% from higher banana sales, an acquisition, and foreign currency; and adjusted EBITDA grew close to 6% from lower shipping costs for bananas in North America and Europe, and lower purchased fruit costs in Europe. Standard & Poor's will review Dole's operating and financial plans with management before resolving the CreditWatch listing. DUNMORE HOMES: U.S. Trustee Appoints 7-Member Creditors' Committee ------------------------------------------------------------------ Pursuant to Section 1102 of the Bankruptcy Code, Diana G. Adams, the United States Trustee for Region 2, appointed seven creditors to the Official Committee of Unsecured Creditors in the Chapter 11 case of Dunmore Homes Inc., effective Nov. 26, 2007. The Creditors' Committee consists of: (1) Bank of New York Trust Company, N.A. 601 Travis, 16th Floor Houston, TX 77002 Attn: J. Chris Matthews, Vice President Tel No.: (713) 483-6267 Fax No.: (713) 483-6644 (2) United Commercial Bank 711 Van Ness Avenue San Francisco, CA 94102 Attn: Ms. Ellen Chiu-Yee Tel No.: (415) 929-6399 Fax No.: (415) 921-7918 (3) Travelers Bond 33650 6th Avenue South Suite 200 Federal Way, WA 98003 Attn: Sam E. Barker, Senior Claim Counsel Tel No.: (253) 943-5802 (866) 842-9201 (4) Cal Sierra Construction, Inc. 5904 Van Alstine Avenue Carmichael, CA 95608 Attn: Marco Lucich, Vice President Shannon Allen Tel No.: (916) 485-3909 Fax No.: (916) 485-3906 (5) The Aleco Corporation 2202 Zeus Court Bakersfield, CA 93380 Attn: Jay Marks, President Tel No.: (661) 395-1000 Fax No.: (661) 326-0418 (6) MacKay & Somps Civil Engineers, Inc. 1771 Tribute Road, Suite E Sacramento, CA 95815-4487 Attn: Mr. James C. Ray, Jr. Tel No.: (916) 929-6092 Fax No.: (916) 923-5625 (7) Hemington Landscape Services, Inc. 4170 Business Drive Cameron Park, CA 95682 Attn: Michael A. Gatto Tel No.: (530) 677-9290 Fax No.: (530) 677-0590 Headquartered in Granite Bay, California, Dunmore Homes Inc. is a privately-owned homebuilder. The company filed for Chapter 11 protection on Nov. 8, 2007 (Bankr. S.D.N.Y. Case No. 07-13533). Maria A. Bove, Esq., and Debra I. Grassgreen, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtor in its restructuring efforts. When the Debtor filed for protection against its creditors, it listed assets and liabilities of more than $100 million. The Debtor's exclusive period to file a plan expires on March 7, 2008. (Dunmore Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). DUNMORE HOMES: Three Big Creditors Want Venue Moved to California ----------------------------------------------------------------- Cal Sierra Construction Inc., Pacific Paving Co. Inc., and Valley Utility Services Inc., ask the United States Bankruptcy Court for the Southern District of New York to transfer venue of the Chapter 11 proceeding of Dunmore Homes Inc., to the Eastern District of California, Sacramento Division. Cal Sierra, Pacific Paving, and Valley Utility are parties-in- interest in the Debtor's Chapter 11 case and are among the Debtor's 20 largest unsecured creditors. Stephanie Wickouski, Esq., at Drinker Biddle & Reath LLP, in New York, argues that the Debtor is based in California as evidenced in its Web site and all of its all of its employees and substantial assets are located in California. Since its inception, she notes, the Debtor has been headquartered in California and currently operates exclusively in California. The Debtor's headquarters is located in Granite Bay, California and its only other corporate office is located in Fresno, California. On the contrary, the Debtor has no present domestic business activity or presence outside of California, Ms. Wickouski avers. It does not maintain any domestic offices or employees outside of California. Furthermore, Ms. Wickouski contends, all of the Debtor's subsidiaries are California entities who are allegedly engaged in an out-of-court restructuring process. Requiring the Debtor's employees and counsel, Ms. Wickouski asserts, to constantly travel from California to New York to serve as witnesses, or otherwise appear and assist in the prosecution of the Debtor's case will be expensive and an unnecessary use of time, travel and disruption to the Debtor's business. Ms. Wickouski adds that: -- none of the creditors on the Debtor's list of 20 largest unsecured creditors is shown as having an office in New York; -- about 18 of the Debtor's largest unsecured creditors have California addresses; and -- as per the Debtor's list of five largest secured claims, the largest and only secured creditor is located in California. Against this backdrop, transferring the venue of the Debtor's case to California is for the convenience of its creditors, Ms. Wickouski avers. The venue of the Debtor's case belongs in California, Ms. Wickouski maintains, and the Debtor's decision to file in New York despite the incontrovertible economies and convenience of, and the vast preponderance of legal factors favoring a California filing must raise the inference that Debtor has come to New York for no reason other than forum shopping. "This is wholly improper," she emphasizes. Headquartered in Granite Bay, California, Dunmore Homes Inc. is a privately-owned homebuilder. The company filed for Chapter 11 protection on Nov. 8, 2007 (Bankr. S.D.N.Y. Case No. 07-13533). Maria A. Bove, Esq., and Debra I. Grassgreen, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtor in its restructuring efforts. When the Debtor filed for protection against its creditors, it listed assets and liabilities of more than $100 million. The Debtor's exclusive period to file a plan expires on March 7, 2008. (Dunmore Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). DURA AUTOMOTIVE: Court Postpones Confirmation Hearing ----------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware has postponed the hearing to consider confirmation of the Joint Plan of Reorganization of DURA Automotive Systems, Inc., and its debtor-affiliates. According to The Associated Press, the Bankruptcy Court canceled the confirmation hearing scheduled for December 6, 2007, saying there was no point moving forward with the Plan until DURA obtains the necessary exit financing. DURA's Chapter 11 plan contemplates a $425,000,000 financing to emerge from Chapter 11. Goldman Sachs Credit Partners, L.P., and Barclays Capital, the investment banking division of Barclays Bank, PLC, as arrangers, have offered to arrange and syndicate: (a) a senior secured revolving credit facility in an amount up to $125,000,000; (b) a senior secured first-lien tranche B term loan facility in amount up to $225,000,000; and (c) a senior secured second-lien term loan facility in an amount up to $75,000,000. DURA, however, has not obtained full commitments for the loan. AP says that DURA has encountered difficulty obtaining the financing amid the recent crunch in credit markets. The Reorganization Plan also contemplates a $140,000,000 to $160,000,000 equity rights offering to be fully backstopped by Pacificor, LLC. Holders of senior notes in excess of $75,000, which also includes Pacificor, were entitled to buy shares of new common stock of DURA at the rights offering, which concluded on November 15, 2007. The participants in the rights offering elected to subscribe approximately $1,300,000. Pursuant to the Court-approved backstop agreement, Pacificor will purchase the unsubscribed portion of the shares. DURA aims to exit Chapter 11 protection by the end of 2007. About Dura Automotive Rochester Hills, Mich.-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The company has three locations in Asia -- China, Japan and Korea. It has locations in Europe and Latin-America, particularly in Mexico, Germany and the United Kingdom. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co- counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had USUS$1,993,178,000 in total assets and USUS$1,730,758,000 in total liabilities. The Debtors' exclusive plan-filing period expired on Sept. 30, 2007. On Aug. 22, 2007, the Debtors' filed their Plan of Reorganization and the Disclosure Statement explaining that Plan was approved on Oct. 3, 2007. (Dura Automotive Bankruptcy News, Issue No. 38 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). EMAGIN CORP: Sept. 30 Balance Sheet Upside-Down by $3.6 Million --------------------------------------------------------------- eMagin Corp.'s consolidated balance sheet at Sept. 30, 2007, showed $7,068,000 in total assets and $10,724,000 in total liabilities, resulting in a $3,656,000 total shareholders' deficit. The company reported a net loss of $12,651,000 on total revenue of $5,071,000 for the third quarter ended Sept. 30, 2007, compared with a net loss of $3,769,000 on total revenue of $2,292,000 in the same period a year ago. Higher revenue was primarily due to increased microdisplay demand and increased availability of finished displays due to manufacturing improvements. For the three months ended Sept. 30, 2007, the change in the derivative liability was a loss of approximately $1.5 million, as compared to $177,000 for the three months ended Sept. 30, 2006. On July 23, 2007, the company recorded a loss on extinguishment of debt of approximately $10.7 million. This loss was in relation to amended agreements the company entered into with the note holders of the original notes issued July 21, 2006, and March 28, 2007. 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?25d2 Going Concern Doubt As reported in the Troubled Company Reporter on April 19, 2007, Eisner LLP expressed substantial doubt on eMagin Corp.'s ability to continue as a going concern after auditing the company's annual report for the year ended Dec. 31, 2006. Eisner reported that the company has had recurring losses from operations which is likely to continue, and has working capital and capital deficits at Dec. 31, 2006. About eMagin Corp. Headquartered in Bellevue, Washington, eMagin Corporation (AMEX: EMA) -- http://www.emagin.com/-- designs, develops, manufactures, and markets virtual imaging products which utilize OLEDs, or organic light emitting diodes, OLED-on-silicon microdisplays and related information technology solutions. ENESCO GROUP: IRS Balks Second Amended Liquidation Plan ------------------------------------------------------- The United States of America, on behalf of the Internal Revenue Service, opposes the confirmation of Enesco Group Inc. and its debtor-affiliates' Second Amended Plan of Liquidation. IRS tells the Court that it objects to the provision of the plan for the payment of its priority claim because it fails to comply with the requirements of a confirmable Chapter 11 plan under Section 1129(a)(9)(C) of the Bankruptcy Code. According to IRS, the Debtors' plan blatantly treats priority claims in different manners without prior determination that these claims deserve preferential treatment due to their insignificance and need for administrative convenience. The Debtors' plan states "until the allowed IRS claim has been paid in full" but limits the sources for payment of claim, thus denying a guarantee of payment of the full priority claim with interest accruing after the confirmation date, IRS points out. As reported in the Troubled Company Reporter on Oct. 24, 2007, the Debtors filed their Second Amended Plan that proposes to liquidate the remaining assets of the Debtors and distribute the proceeds to the holders of the allowed claims. The principal source of the distributions will be: a) cash on hand as of the effective date of the Plan; b) proceeds from the Debtors' lender settlement; c) proceeds and tax refunds arising out of the resolution of the Hong Kong Tax Dispute; d) proceeds from the Contingency Litigation Agreement; and e) Litigation Trust Proceeds. Summary Treatment of Claims Under The Plan The Plan proposes that all holders of allowed administrative claims, allowed priority claims, other than the Internal Revenue Service, and the allowed non-tax priority claims will have their allowed claims paid in full on or about the effective date of the plan from the proceeds of the Lender Settlement. In addition, within 60 days of the effective date, general unsecured creditors will receive their pro-rate share of $480,000 from the proceeds of the Lender Settlement. The Debtors say that general unsecured creditors are expected to receive 27% of their claims. Unsecured creditors will further be entitled to receive additional future distribution. Within the same time frame, the Internal Revenue Service will receive $650,000 from the proceeds of the Lender Settlement and will be entitled to receive additional future distribution. Additional contributions, the Debtors say, are however, contingent on future recoveries by the Debtors and are not guaranteed. The Contingency Litigation Trust, the Debtors add, are also not guaranteed. Summary Creditor Treatment if Plan is Not Confirmed The Debtors told the Court that if the Plan is not confirmed, then they are not substantively consolidated for purposes of the Plan or their cases are converted to ones under Chapter 7 of the Bankruptcy Code. At the conclusion of the Chapter 7 cases, administrative claims will still be paid in full. However, tax priority claims holders will only receive 4.9% of their claims. General Unsecured Creditors on the other hand, will receive nothing. The Debtors revealed that the primary reasons for the significantly smaller distributions under this scenario are: 1) the proceeds and other benefits from the: -- Lender Settlement; -- the Contingency Litigation Agreement; and -- the resolution of the Hong Kong Tax Dispute, will be substantially compromised or lost, resulting in a significantly smaller recovery by the Debtors' estates; and 2) there will be additional administrative costs if the Plan is not confirmed. About Enesco Group Based in Itasca, Illinois, Enesco Group, Inc. -- http://www.enesco.com/-- is a producer of giftware, and home and garden decor products. Enesco's product lines include some of the world's most recognizable brands, including Disney, Heartwood Creek, Nickelodeon, Cherished Teddies, Lilliput Lane, Border Fine Arts, among others. Enesco distributes products to a wide array of specialty gift retailers, home decor boutiques and direct mail retailers, as well as mass-market chains. The company serves markets operating in Europe, particularly in the United Kingdom and France, as well in the Asia Pacific in Australia and Hong Kong. The company also has Latin-American operations in Mexico. Enesco Group and its two affiliates, Enesco International Ltd. and Gregg Manufacturing, Inc., filed for chapter 11 protection on Jan. 12, 2007 (Bankr. N.D. Ill. Lead Case No. 07-00565). Shaw Gussis Fishman Glantz Wolfson & Tow and Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors. Epiq Bankruptcy Solutions, LLC, acts as the Debtors' claims and noticing agent. In schedules of assets and debts filed with the Court, Enesco disclosed total assets of $61,879,068 and total debts of $231,510,180. Chad H. Gettleman, Esq., and Brad A. Berish, Esq., at Adelman & Gettleman, Ltd., represent the Official Committee of Unsecured Creditors. William R. Baldiga, Esq., Jessica M. Paris, Esq., and Robert J. Stark, Esq., at Brown Rudnick Berlack Israels LLP; and Thomas V. Askounis, Esq., at Askounis & Borst, PC, represent the Ad Hoc Committee of Equity Security Holders. ENVIRONMENTAL TECTONICS: PNC Waives Default on Credit Facility -------------------------------------------------------------- Environmental Tectonics Corporation said Wednesday that on Nov. 21, 2007, it executed a consent and waiver letter with respect to violations of certain covenants in its credit facility with PNC Bank. PNC agreed to waive a financial statement default (and any comparable default in respect of the company's financial statements as of any prior fiscal period), provided that the company is required to deliver to PNC its restated financial statements for the fiscal year ended Feb. 23, 2007 no later than Jan. 31, 2008. PNC also waived a net worth covenant default as of Feb. 23, 2007. The foregoing waivers do not operate as a, or obligate PNC to grant any, future waiver or modification of the provisions of the credit agreement with respect to any other financial statements of the company or of the consolidated tangible net worth covenant as of any other date or of any other term, condition or event of default under the credit agreement. In addition, in connection with certain obligations of the company under a contract with the Turkish Air Force, the company has arranged for the OyakBank A.S., located in Turkey, to issue a letter of guarantee on its behalf for which it is obligated to deposit $2,310,000 in an account at OyakBank and pledge such account to OyakBank as security for its reimbursement obligations under such letter of guarantee. Since the terms of the credit agreement prohibit the account pledge, the company has requested and PNC has consented to the account pledge and waived the limitations of the credit agreement to permit the company to enter into the account pledge. On July 31, 2007, the company completed a refinancing of its indebtedness with PNC in the aggregate amount of up to $15,000,000. In connection with the refinancing, the company entered into a credit agreement with PNC. Need for Various Restatements On Nov. 14, 2007, the audit committee of the board of directors of the company, in consultation with management, determined that the company will need to restate its previously issued consolidated financial statements for prior periods, including the periods ended Nov. 24, 2006 and Feb. 23, 2007, due to errors in accounting with respect to accounts receivable related to the carrying value of a claims receivable booked in connection with a contract with the Department of the Navy for a submarine decompression chamber project. The company is in the process of determining if these errors in accounting affected additional periods prior to the fiscal quarter ended Nov. 24, 2006, including for the fiscal years ended Feb. 28, 2003, Feb. 27, 2004, Feb. 25, 2005 and Feb. 24, 2006. Default Due to Restatements As a result of the restatement, the company was in breach of the representation and warranty contained in Section 7(a) of the credit agreement with respect to its previously delivered financial statements as set forth in the company's Annual Report on Form 10-K for the fiscal year ended Feb. 23, 2007. The breach on the credit agreement arose because the financial statements were not true, complete and accurate in all material respects and did not fairly present the financial condition, assets and liabilities of the company as of the date of the financial statements. This breach constituted an event of default under the credit agreement and related documents. In addition, the restatement caused the company to be in breach of the consolidated tangible net worth covenant set forth in the credit agreement. About Environmental Tectonics Southampton, Pennsylvania-based Environmental Tectonics Corporation (AMEX: ETC) -- http://www.etcusa.com/-- designs, develops, installs and maintains aircrew training systems (aeromedical, tactical combat and general), disaster management training systems and services, entertainment products, sterilizers (steam and gas), environmental testing products, hyperbaric chambers and related products for domestic and international customers. EQUINOX ON THE PARK: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Equinox on the Park, Ltd. 1 Galleria Plaza Suite 1950 Metairie, LA 70001 Tel: (504) 836-5075 Bankruptcy Case No.: 07-12319 Type of Business: The Debtor's affiliates, M.B.S. Management Services, Inc., filed for Chapter 11 protection on Nov. 5, 2007 (Bankr. E.D. La. Case No. 07-12161). Chapter 11 Petition Date: November 27, 2007 Court: Eastern District of Louisiana (New Orleans) Debtor's Counsel: Douglas S. Draper, Esq. Heller Draper Hayden Patrick & Horn, LLC 650 Poydras Street, Suite 2500 New Orleans, LA 70130 Tel: (504) 299-3300 Fax: (504) 299-3399 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wilmar Supply Co., Inc. $24,533 200 East Park Drive, Suite 200 Mt. Laurel, NJ 00854 Rasa Floors $24,533 P.O. Box 619130 Dallas, TX 75261-9130 City of Garland Electric Water $15,000 800 Main Street Garland, TX 75040 Ameri-Tax Pool Services $7,792 M&M Painting Services $5,944 Geary, Porter & Donovan, P.C. $3,899 Hurricane Mirror & Glass & Screen $2,875 Jesse Painting & Remodeling $2,451 and Mazon As The Apperance Group $2,419 Classic Scapes Landscaping $2,410 Trejo Cleaning $2,170 City of Garland Trash $2,000 G.E. Capital $1,977 Southwest Access Controls $1,696 Titan Fire Controls $1,558 Eastin Heating & Air $1,527 Conditioning, Inc. AT&T Telephone $1,250 Industrial Disposal Supply Co. $1,231 RPC Services $1,190 Network Communications, Inc. $1,174 FEENUNE LLC: Case Summary & Five Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Feenune LLC P.O. Box 1173 Verdi, NV 89439-1173 Bankruptcy Case No.: 07-51609 Type of Business: The Debtor's managing member, Karen O'Sullivan, filed for Chapter 11 protection on Aug. 20, 2007 (Bankr. D. Nev. Case No. 07-51107). Chapter 11 Petition Date: November 26, 2007 Court: District of Nevada (Reno) Judge: Gregg W. Zive Debtor's Counsel: Alan R. Smith, Esq. Law Offices of Alan R. Smith 505 Ridge Street Reno, NV 89501 Tel: (775) 786-4579 Fax: (775) 786-3066 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its Five Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Patty Battaglia $250,000 965 Regina Way Pacifica, CA 94044 Rose Shannon $200,000 7438 Spyglass Drive Modesto, CA 95356 Gerri Bobblitt Trust $35,000 11326 Glenwood Avenue Yuma, AZ 85367 Licatta Hanson $25,000 Sierra County Tax Collector $11,775 FIELDSTONE MORTGAGE: Can Access C-BASS' $1.5 Mil. DIP Facility -------------------------------------------------------------- The Hon. James F. Schneider of the U.S. Bankruptcy Court for the District of Maryland on Wednesday gave Fieldstone Mortgage Co. permission to access Credit-Based Asset Servicing and Securitization LLC's $1.5 million debtor-in-possession facility, Baltimore Sun reports. The Debtor told the Court that it will use the money to continue its operations while it ponders on whether to liquidate or wait until the mortgage industry returns to profitability, Baltimore Sun says. C-BASS agreed to extend the DIP fund to the Debtor to facilitate settlement relating to lawsuits between C-BASS and the Debtor, Baltimore Sun relates, citing Debtor's counsel, Joel I. Sher, Esq. Headquartered in Columbia, Maryland, Fieldstone Mortgage Co. -- http://www.fieldstonemortgage.com/-- is a direct lender that offers mortgage loans for multiple credit situations in the United States. In September 2007, Fieldstone was the target of a lawsuit by Morgan Stanley over 72 mortgages worth $26.5 million that had no, or late, payments. The company has trimmed its workforce from 1,000 employees to a mere 25 workers. The company filed for chapter 11 bankruptcy on Nov. 23, 2007 (Bankr. D. Md. Case No. 07-21814) citing loan payment lapses and credit market woes. Joel I. Sher, Esq., at Shapiro, Sher, Guinot & Sandler represents the Debtor in its restructuring efforts. When the Debtor filed for bankruptcy, it listed assets between $1 million to $100 million and debts of more than $100 million. FINLAY ENTERPRISES: Posts $7.5MM Net Loss in Period Ended Nov. 3 ---------------------------------------------------------------- Finlay Enterprises Inc. reported its financial results for the third quarter and first nine months of fiscal 2007. For the thirteen weeks ended Nov. 3, 2007, the company reported net loss of $7.5 million compared to net loss of $7.9 million for the same peiord in the prior year. For the thirty-nine weeks ended Nov. 3, 2007, the company reported a net loss of $23.5 million, compared to a net loss of $11.8 million for the thirty-nine weeks ended Oct. 28, 2006. At Nov. 3, 2007, the company's balance sheet showed total assets of $562.1 million, total liabilities $462.1 million and total stockholders' equity $100 million. "Although our same store sales performance in the third quarter was lower than we originally anticipated, we believe we are well positioned for the all-important holiday season," stated Arthur E. Reiner, chairman and chief executive officer of Finlay Enterprises Inc. "Our team is focused on achieving a successful fourth quarter in our core business." "We are encouraged by the ongoing growth of our specialty jewelry stores and by our continued comparable store sales growth, especially given the challenging retail environment. We are pleased with the closing on November 9 of our acquisition of Bailey Banks & Biddle, which we anticipate will be accretive to earnings in the fourth quarter, and look forward to the integration of their operations into Finlay. The acquisition significantly expands our presence in the luxury jewelry market which remains one of the most attractive segments of the jewelry industry," Mr. Reiner added. About Finlay Enterprises Inc. Headquartered in New York City, Finlay Enterprises Inc. (Nasdaq: FNLY) -- http://www.finlayenterprises.com/-- through its wholly- owned subsidiary, Finlay Fine Jewelry Corporation, is a retailer of fine jewelry operating luxury stand-alone specialty jewelry stores primarily located in the southeastern United States and licensed fine jewelry departments in department stores throughout the United States. The number of locations at the end of the second quarter of fiscal 2007 totaled 725, including 33 Carlyle and five Congress specialty jewelry stores. * * * As reported in the Troubled Company Reporter on Oct. 1, 2007, Standard & Poor's Ratings Services placed its 'B' coporate credit ratings on both Finlay Enterprises Inc. and its wholly owned subsidiary, Finlay Fine Jewelry Corp., on CreditWatch with negative implications. GAP INC: Board Declares $0.08 Per Share Quarterly Dividend ---------------------------------------------------------- The board of directors of Gap Inc. voted a quarterly dividend of $0.08 per share payable on Jan. 30, 2008 to shareholders of record at the close of business on Jan. 9, 2008. Gap Inc. (NYSE: GPS) -- http://www.gapinc.com/-- is an international specialty retailer offering clothing, accessories and personal care products for men, women, children and babies under the Gap, Banana Republic, Old Navy, Forth & Towne and Piperlime brand names. Gap Inc. operates more than 3,100 stores in the United States, the United Kingdom, Canada, France, Ireland and Japan. In addition, Gap Inc. is expanding its international presence with franchise agreements for Gap and Banana Republic in Southeast Asia and the Middle East. * * * The company continues to carry Fitch's BB+ Issuer Default Rating. The company also carries Standard & Poor's Ratings Services' BB+ corporate credit rating. GP&E OPERATING LP: Involuntary Chapter 11 Case Summary ------------------------------------------------------ Alleged Debtor: G.P.&E. Operating, L.P. 1701 North Market Street, Suite 210 Dallas, TX 75202 Case Number: 07-35798 Involuntary Petition Date: November 26, 2007 Court: Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Petitioners' Counsel: Ryan E. Manns, Esq. Fulbright and Jaworski L.L.P. 2200 Ross Avenue, Suite 2800 Dallas, TX 75201 Tel: (214) 855-8000 Fax: (214) 855-8200 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Cooper Concrete Co. business debt $18,794 P.O. Box 461118 Garland, TX 75046 Texans Credit Union unknown 777 East Campbell Road, Suite 700 Richardson, TX 75081 Michaels Nursery unknown P.O. Box 1067 Glenmore, LA 71433 GS MORTGAGE: Fitch Lowers Rating on $14.9MM Certificates to BB -------------------------------------------------------------- Fitch Ratings has taken rating actions on GS Mortgage Securities Corp. mortgage pass-through certificates. Affirmations total $251.4 million and downgrades total $31.1 million. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: GSAMP 2005-HE3 -- $20.9 million class A affirmed at 'AAA' (BL: 98.70, LCR: 8.16); -- $96.5 million class M-1 affirmed at 'AA+' (BL: 69.19, LCR: 5.72); -- $75.1 million class M-2 affirmed at 'A' (BL: 24.52, LCR: 2.03); -- $20.7 million class M-3 affirmed at 'A-' (BL: 21.78, LCR: 1.80); -- $19.4 million class M-4 affirmed at 'A-' (BL: 19.13, LCR: 1.58); -- $18.8 million class B-1 affirmed at 'BBB+' (BL: 16.59, LCR: 1.37); -- $16.2 million class B-2 downgraded to 'BBB-' from 'BBB' (BL: 14.41, LCR: 1.19); -- $14.9 million class B-3 downgraded to 'BB' from 'BBB-' (BL: 12.75, LCR: 1.05). Deal Summary -- Originators: (Various); -- 60+ day Delinquency: 28.18%; -- Realized Losses to date (% of Original Balance): 0.94%; -- Expected Remaining Losses (% of Current Balance): 12.09%; -- Cumulative Expected Losses (% of Original Balance): 3.93%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. HANESBRANDS INC: S&P Affirms 'B+' Rating and Revises Outlook ------------------------------------------------------------ Standard & Poor's Ratings Services revised its ratings outlook for Winston-Salem, North Carolina-based intimate apparel and activewear maker Hanesbrands Inc. to positive from stable. At the same time, existing ratings on the company, including the 'B+' corporate credit rating, were affirmed. "The outlook revision reflects the company's positive operating momentum as a standalone entity since its spin-off from Sara Lee Corp. in September 2006, and its modestly improving credit protection measures," said Standard & Poor's credit analyst Susan Ding. "Management is on track in executing the company's strategies, is focusing on investing in key brands, and has benefited from its cost saving initiatives. Credit protection measures and operating results are in line with our expectations." The ratings on Hanesbrands reflect the company's leveraged financial profile, resulting from its debt-financed $2.4 billion special dividend to Sara Lee Corp. following its spin-off; the commodity-like nature of some of Hanesbrands' products; the highly competitive and promotional retail environment; and the company's relatively narrow business focus. These risks are somewhat mitigated by Hanesbrands' strong and widely recognized brand names (including Hanes, Champion, Playtex, and Bali), its core replenishment business (which is less susceptible to fashion risk), and its relatively stable cash flows. HOMEBANC CORP: Can Sell Mortgage Loans with Unpaid Amount of $10MM ------------------------------------------------------------------ The United States Bankruptcy Court for the District of Delaware authorized HomeBanc Mortgage Corp. and its debtor-affiliates to implement procedures for selling mortgage loans with unpaid principal amount of $10,000,000, and the servicing rights to the loans free and clear of all liens, claims, interest and other encumbrances, without any representations or warranties of any kind. The Assets come from two sources: (a) loans that the Debtors closed with their own cash. Prepetition, these Loans were not pledged as collateral to any third party or sold into securitizations or otherwise; and (b) loans that the Debtors have repurchased from third parties, either pursuant to repurchase agreements with the Debtors' lenders or from investors to whom the Loans had previously been sold. According to Joseph M. Barry, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, the Assets consist primarily of hybrid adjustable rate mortgages with both conforming and non-conforming loan amounts and credit features. There is also some agency and alternative credit rate fixed rate mortgages with both conforming and non-conforming loan amounts and credit features. The Assets have typical industry interest rate caps and margins. As of November 7, 2007, the unpaid principal balance of the Assets is approximately $10,000,000, plus or minus 5%. Because the population of the Loans is dynamic, the unpaid principal balance, as well as the Asset structure, may change, Mr. Barry says. The Debtors propose to sell the Assets as a whole loan sale with the servicing rights released. The Loans will be sold as loans, rather than as part of a bond or security offering, Mr. Barry explains. The Debtors will be providing no on-going representations and warranties with regard to the Loans. The potential purchasers will likely be institutional Wall Street firms, investment conduits, or market makers that purchase or securitize mortgage loan assets -- Traders, he adds. The Debtors also propose to conduct the Sale pursuant to these procedures, which are substantially similar to procedures used by the Debtors in selling mortgage loans before the Petition Date: * The Debtors will conduct a detailed valuation of the Assets, which will reflect the market value of the Loans and Servicing Rights, discounted to reflect the credit quality of the Loans and the lack of representations and warranties; * The Debtors will submit the Valuation and a marked to market range the Debtors can expect to realize from the Sale -- Expected Proceeds -- to the Official Committee of Unsecured Creditors and the Debtors' prepetition and postpetition lenders; * The Approval Group will have five business days to object to the Expected Proceeds as being insufficient. At the expiration of the objection period, if there has been no objection to the Expected Proceeds, the Debtors will continue with the Sale Procedures; * The Assets will be offered to Traders -- Bid Rotation -- as selected by the Debtors, via an e-mail, which will include a detailed description of the Assets. The Assets description will include a stratification of the Loans, stipulations, settlement time and other financial data; * The Bid Rotation will call for bids on the Assets on a specific day and time, which will be 24 to 36 hours after the Bid Rotation e-mail has been sent; * Bids will be submitted to the Debtors via telephone at the Bid Date/Time. The Debtors will accept a bid with a Trader in the time and manner that is customary in the industry and inform the winning Trader -- Buyer -- of the following; * If the winning bid is equal to or greater than the Expected Proceeds, the Debtors will file a notice of the winning bid with the Court, identifying the Buyer. If the winning bid is less than the Expected Proceeds, the Debtors must submit the bid to the Approval Group, which will have three business days to object to the bid. At the expiration of the second objection period, if there has been no objection to the bid, the Debtors will file the winning bid notice; * Within three business days after the Winning Bid Notice has been filed with the Court, the Buyer will send a letter detailing the general terms of the sale. The Buyer will have 30 days after the filing of the notice to conduct due diligence on the Assets and negotiate stipulations with the Debtors. Any material stipulations or changes to the bid will be subject to approval by the Approval Group; and * The Buyer will deliver the proceeds from the purchase price to the Debtors via wire on the settlement date. The Debtors are in the process of liquidating their residual estates and winding down their business affairs and, accordingly, have no use for the Assets. Since the Sales Procedures are similar to those the Debtors used before they entered bankruptcy and are typical for a sale of such assets in the industry, the Sales Procedures are "likely to yield the highest and best value for the Assets," Mr. Barry tells the Court. Moreover, given the notice mechanisms incorporated into the Sale Procedures, all constituencies will be afforded fair notice of the transactions contemplated. The Debtors submit that the proposed Sale Procedures is in good faith, constitutes an exercise of sound business judgment and is in the best interests of their estates and creditors. Headquartered in Atlanta, Ga., HomeBanc Mortgage Corporation -- http://www.homebanc.com/-- is a mortgage banking company focused on originating primarily prime purchase money residential mortgage loans in the Southeast United States. HomeBanc Mortgage together with five affiliates filed for chapter 11 protection on Aug. 9, 2007 (Bankr. D. Del. Case Nos. 07-11079 through 07-11084). Joel A. Waite, Esq., at Young, Conaway, Stargatt & Taylor was selected by the Debtors to represent them in these cases. The Debtors' financial condition as of June 30, 2007, showed total assets of $5,100,000,000 and total liabilities of $4,900,000,000. The Debtors' exclusive period to file a plan ends on Dec. 7, 2007. (HomeBanc Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). HOMESTAR MORTGAGE: S&P Cuts Rating on Class M-8 to B from BBB- -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on class M-8 from Homestar Mortgage Acceptance Corp.'s series 2004-6 to 'B' from 'BBB-'. At the same time, S&P placed its 'BBB' rating on class M-7 from the same series on CreditWatch with negative implications. Finally, S&P affirmed its ratings on the nine remaining classes from this transaction. The lowered rating and negative CreditWatch placement reflect the high delinquencies relative to the available credit support in the deal. Current credit support for classes M-7 and M-8 from series 2004-6 is 2.96% and 2.57% of the current pool balance, respectively, and future credit support is projected to be significantly lower than the original credit support for both of these classes. The amount of overcollateralization for this transaction is at approximately 66% of its target. As of the October 2007 remittance period, cumulative losses for series 2004- 6 were 0.60% of the original pool balance, total delinquencies were 11.14% of the current pool balance, and severe delinquencies (90-plus days, foreclosures, and REOs) were 6.00% of the current pool balance. The affirmations reflect current and projected credit support percentages that are sufficient to support the certificates at their current rating levels. A combination of subordination, excess spread, and O/C provide primary credit support for this transaction. In addition, class A-3B benefits from a certificate of guarantee issued by Ambac Assurance Corp. The underlying collateral for this transaction consists primarily of fixed- and adjustable-rate Alternative-A mortgage loans secured by first liens and second liens on one- to four-family residential properties. Rating Lowered Homestar Mortgage Acceptance Corp. 2004-6 Rating ------ Class To From ----- -- ---- M-8 B BBB- Rating Placed on Creditwatch Negative Homestar Mortgage Acceptance Corp. 2004-6 Rating ------ Class To From ----- -- ---- M-7 BBB/Watch Neg BBB Ratings Affirmed Homestar Mortgage Acceptance Corp. 2004-6 Class Rating ----- ------ A-2, A-3A, A-3B AAA M-1 AA+ M-2 AA M-3 A+ M-4 A M-5 A- M-6 BBB+ IPSWICH STREET: Moody's Places B1 Rating Under Review ----------------------------------------------------- Moody's Investors Service placed these notes issued by Ipswich Street CDO, Ltd. on review for possible downgrade: Class Description: $60,000,000 Class A-2 Second Priority Senior Secured Floating Rate -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $62,000,000 Class B Third Priority Senior Secured Floating Rate Notes -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade Class Description: $25,000,000 Class C Fourth Priority Senior Secured Deferrable Floating Rate Notes -- Prior Rating: A2 -- Current Rating: A2, on review for possible downgrade Class Description: $10,000,000 Class D Fifth Priority Mezzanine Secured Deferrable Floating Rate Notes -- Prior Rating: Baa2 -- Current Rating: Baa2, on review for possible downgrade In addition Moody's also announced that it has downgraded and left on review for possible downgrade these notes: Class Description: $7,900,000 Class E Sixth Priority Mezzanine Secured Deferrable Floating Rate Notes -- Prior Rating: Ba1, on review for possible downgrade -- 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 residential mortgage-backed securities, commercial mortgage-backed securities, other asset-backed securities and synthetic securities. ISONICS CORP: Inks Merger Term Sheet with Universal Guardian ------------------------------------------------------------ Isonics Corporation entered, on Nov. 16, 2007, into a with Universal Guardian Holdings Inc. to complete merger by which it will acquire all of the outstanding shares of Universal Guardian. "Universal Guardian believes that, if completed, this will be a synergistic merger between UG Services and UG Products with Isonics' Protection Plus Security Corporation subsidiary based in New York," Kevin Westcott, president and COO of Universal Guardian, stated. The non-binding term sheet contemplates a tax-free reorganization for the shareholders of Universal Guardian pursuant to which they would receive Isonics common stock with an aggregate value of approximately $10.3 million, with the price of Isonics common stock to be valued at 100% of the 5-day volume weighted average price of Isonics common stock after shareholder approval. Existing Universal Guardian debt holders would receive shares of Isonics convertible preferred stock. The preferred stock is expected to have a conversion price equal to 100% of the 5-day VWAP of Isonics common stock following shareholder approval. The obligations of Isonics and Universal Guardian to complete the transaction are subject to a number of conditions precedent and, therefore, there can be no assurance that Isonics or Universal Guardian will complete the transaction at all or on the same terms contemplated. Among the material conditions precedent are: 1) The parties must execute a definitive merger agreement by Dec. 31, 2007, subject to Isonics' and Universal Guardian's shareholders' approval and approved in advance of such execution by the boards of directors of Isonics and Universal Guardian, otherwise each party will have the right to withdraw from the transaction; 2) Agreement by the holders of the Universal Guardian convertible debentures as described above; 3) Agreement by Isonics' principal debt holder, Y.A. Global Investments L.P. to waive certain existing and prospective defaults under certain Isonics debt instruments for a period of one year from the date of the closing of the merger; 4) The infusion of $4.0 million in financing, which, if equity financing, will be payable or issuable in post- merger Isonics equity; 5) Satisfactory due diligence by the parties; 6) Continued listing of Isonics common stock on the NASDAQ Capital Market through the date of the closing of the merger, otherwise each party will have the right to withdraw from the transaction; 7) Approval of the merger by the shareholders of Universal Guardian and Isonics; 8) Registration by Isonics of all common stock to be granted to the Universal Guardian shareholders prior to the date of the closing of the merger; and 9) Satisfaction of other normal closing conditions such as the continuing accuracy of all representations, warranties, obtaining all necessary consents and approvals, no material adverse changes, and execution of appropriate employment agreements. About Universal Guardian Universal Guardian Holdings Inc. (OTC BB: UGHO.OB) -- http://www.UniversalGuardian.com/-- and its subsidiaries provide a comprehensive range of security products, systems, and services designed to mitigate terrorist and security threats worldwide. About Isonics Corporation Based in Golden, Colorado, Isonics Corp. (NasdaqCM: ISON) -- http://www.isonics.com/-- develops, manufactures, and markets various specialty chemicals used in semiconductor devices, medical diagnostics, imaging and therapy, drug development, and energy production. Going Concern Doubt Hein & Associates LLP, in Denver, expressed substantial doubt about Isonics Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the years ended April 30, 2007, and 2006. The auditing firm reported that the company has suffered recurring losses from operations and will continue to require funding from investors for working capital. JAMES RIVER: Selling 4.5MM Shares Common Stock in Public Offering ----------------------------------------------------------------- James River Coal Company has agreed to sell 4,500,000 shares, with an over-allotment option to sell up to an additional 675,000 shares, of its common stock in a public offering through UBS Investment Bank. A written prospectus may be obtained, when available, from sales representatives of: UBS Securities LLC Attn: Prospectus Department 299 Park Avenue New York, NY 10171 Tel (212)-821-3884 After this offering there will be approximately 21,236,727 shares of common stock outstanding or 21,911,727 shares if the over- allotment option is exercised in full. Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. * * * James River Coal Co. still carries Standard & Poor's Ratings Services 'CCC' corporate credit rating. The outlook remains negative. JAMESON DEVELOPMENT: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Lead Debtor: Jameson Development, L.L.C. 1220 Allen Avenue St. Louis, MO 63104 Bankruptcy Case No.: 07-47858 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- R.O.I. Property Partners, L.L.C. 07-47860 Allen Partners I, L.L.C. 07-47861 Lucas Meeting & Event Center, L.L.C. 07-47862 Chapter 11 Petition Date: November 27, 2007 Court: Eastern District of Missouri (St. Louis) Judge: Barry S. Schermer Debtor's Counsel: Spencer P. Desai, Esq. Capes, Sokol, Goodman and Sarachan, P.C. Pierre Laclede Center 7701 Forsyth Boulevard, 12th Floor St. Louis, MO 63105 Tel: (314) 721-7701 Fax: (314) 721-0554 Estimated Assets Estimated Debts ---------------- --------------- Jameson Development, $1 Million to $1 Million to L.L.C. $100 Million $100 Million R.O.I. Property Partners, $1 Million to $100,000 to L.L.C. $100 Million $1 Million Allen Partners I, L.L.C. Less than Less than $10,000 $10,000 Lucas Meeting & Event $100,000 to $1 Million to Center, L.L.C. $1 Million $100 Million The Debtors did not file lists of their 20 largest unsecured creditors. JAYS FOODS: Court Fixes December 17 as Claims Bar Date ------------------------------------------------------ The United States Bankruptcy Court for the Northern District of Illinois set Dec. 17, 2007 as the period in which creditors of Jays Foods Inc. and Select Snacks Inc. must file their proofs of claim against the Debtors. In the case of governmental units, the bar date is set for April 8, 2008. Proofs of claim are to be sent to: Select Snacks Inc., et. al. Claims Processing c/o Kurtzman Carson Consultants LLC 2335 Alaska Ave. El Segundo, California 90245 Chicago-based Jays Foods Inc. -- http://www.jaysfoods.com/-- wholesales confectionery products and manufactures snack chip products. Jays Foods leases real property, and owns certain equipment, in Chicago, Illinois where it operates a manufacturing facility that makes snacks mostly under the Jays, O-KE-DOKE and Krunchers brand names. Jays is 100% owned by Jays Holding Company, Inc. The company, then known as Jays Food LLC, first filed for chapter 11 protection on March 5, 2004 (Bankr. N.D. Ill. Case No. 04- 08681). David Missner, Esq., Marc I. Fenton, Esq. and Thomas Zwartz, Esq. at Piper Rudnick LLP were counsels to the Debtor. In the March 2004 case, a Section 363 sale took place and most of the assets of former Jays Foods were sold to Jays Foods Acquisition Inc., predecessor to Jays Foods Inc. The March 2004 case was closed on or about March 9, 2007. Select Snacks Inc., on the other hand, owns real property, improvements and equipment in Jeffersonville, Indiana where it operates a manufacturing facility that makes private label and co- manufactured snacks for its customers. Select Snacks is 100% owned by Select Snacks Holdings Company, Inc. Both Select Holding and Jays Holding are 100% owned by Ubiquity Brands LLC. As of the Oct. 11, 2007, the Debtors had approximately 943 employees of which Select has 262 (211 union employees and, 51 non-union employees) and Jays has 681 total employees (236 union employees and 445 non-union employees). Jays Foods and Select Snacks filed voluntary chapter 11 petitions on Oct. 11, 2007 (Bankr. N.D. Ill. Case Nos. 07-18768 and 07-18769). Mark K. Thomas, Esq., Brian I. Swett, Esq., Jeremy T. Stillings, Esq., Myja K. Kjaer, Esq., at Winston & Strawn LLP, represent the Debtors. Kurtzman Carson Consultants LLC serve as their notice, claims and balloting agent. The Official Committee of Unsecured Creditors has selected Jeffrey N. Pomerantz, Esq., and Jeffrey W. Dulberg, Esq., at Pachulski Stang Ziehl & Jones LLP, as its counsel. When the Debtors sought protection from their creditors, they listed assets and debts between $10 million and $50 million. JOHN RYAN: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------- Debtor: John Austin Patrick Ryan, Jr. 6370 Quebec Drive Los Angeles, CA 90068 Bankruptcy Case No.: 07-20942 Chapter 11 Petition Date: November 27, 2007 Court: Central District Of California (Los Angeles) Judge: Victoria S. Kaufman Debtor's Counsel: Thomas B. Ure, Esq. Ure, Ranieri & Associates 800 Wilshire Blvd Ste 1050 Los Angeles, CA 90017 Tel: (213) 202-6070 Fax: (213) 202-6075 Estimated Assets: $1 million to $100 million Estimated Debts: $1 million to $100 million Debtor's Four Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Bank Of America $11,500 P.O. Box 15019 Wilsmington, DE 19886 Washington Mutual $2,450 P.O. Box 660487 Dallas, TX 75266-0487 Macy's $1,100 P.O. Box 6938 The Lakes, NV 88901 Bloomingdale's $1,000 P.O. Box 689194 Des Moinies, IA 50368-9194 KMART CORP: Fitch Retains Junk Ratings on $3.9MM Certificates ------------------------------------------------------------- Kmart Corporation Pass-Through Trusts, series 1995 K-1 and series 1995 K-2 long-term credit and Distressed Recovery ratings are maintained by Fitch Ratings as: -- $1.7 million K-1 at 'C/DR6'; -- $2.2 million K-2 at 'C/DR6'. The certificates are currently collateralized by an assignment of rents on four open and operating properties guaranteed by absolute net leases to Kmart Corporation, in which Kmart is obligated to pay rental payments with no setoff, abatement or reduction. The collateral originally consisted of 16 stores, 12 of which closed when Kmart rejected the leases after the bankruptcy filing in January 2002. The bankruptcy filing triggered an acceleration of the of the bond payments. When payments are received from the four operating properties, the bonds are allocated pro rata principal payments. The ratings were taken to 'D' when Fitch determined that the values of the properties with rejected leases would not support the outstanding loan balances or repay the interest shortfalls. Since that time, the bonds have received both payments of principal, as well as realized losses due to the non- payment of leases on the rejected properties. The ratings were revised to 'C/DR6' during Fitch's DR rating review in April 2006. The ratings are no longer dependent on Kmart's corporate rating, or the rating of Kmart's parent, Sears Holding Corporation. LAKE MARTIN: Selects Espy Metcalf as Bankruptcy Counsel ------------------------------------------------------- Lake Martin Partners LLC obtained approval from the United States Bankruptcy Court for the Middle District of Alabama to employ Espy, Metcalf & Espy PC as its bankruptcy counsel. Espy Metcalf will: a. advise the Debtor with respect to its powers and duties as Debtor-in-possession in the continued management and operation of its business and properties; b. advise and consult on the conduct of the chapter 11 cases, including all of the legal and administrative requirements of operating in chapter 11; c. take all necessary action to protect and preserve the Debtor's estate, including prosecuting actions on the Debtor's behalf, defending any action commenced against the Debtor and representing the Debtor's interests in negotiations concerning all litigation in which the Debtor is involved, including objections to claims filed against the Debtor's estate; d. prepare appropriate pleadings, including motions, applications, orders, reports and papers necessary or otherwise beneficial to the administration of the Debtor's estate; e. perform other necessary or otherwise beneficial legal services for the Debtor in connection with the prosecution of the chapter 11 case. The Debtor will pay Espy Metcalf at its current hourly rates: Designation Hourly Rate ----------- ----------- Partner $300 Associate $100 - $200 Paraprofessional $60 - $90 The professionals who are expected to have primary responsibility for providing services to the Debtor are Cameron A. Metcalf, Esq., at $300, Collier H. Espy, Jr., Esq., at $300, and Jonathan Kaz Espy, Esq., at $150. To the best of the Debtor's knowledge, Espy Metcalf is a "disinterested person" withing the meaning of Section 101(14) of the Bankruptcy Code and does not hold or represent an interest adverse to the Debtor's estate. The firm can be reached at: Espy, Metcalf & Espy PC 326 North Oates St. Dothan, AL 36303 Tel: 334-793-6288 Toll-Free: 1-800-310-4020 Fax: 334-712-1617 http://www.emppc.com/ Dothan, Alabama-based Lake Martin Partners LLC owns an 18 acre condominium development project on Lake Martin in Tallapoosa County, Alabama. The Debtor filed for chapter 11 bankruptcy on Oct. 19, 2007 (Bankr. M.D. Ala. Case No. 07-11470). The Debtor's schedules disclosed total assets of $14,140,003 and total liabilities of $27,836,721. LAKE MARTIN: Can Borrow $4,415,000 from Empire Financial -------------------------------------------------------- Dwight H. Williams, Jr., of the U.S. Bankruptcy Court for the Middle District of Alabama gave Lake Martin Partners LLC final approval to borrow $4,415,000 in debtor-in-possession financing from Empire Financial Services Inc. The Debtor relates to the Court that it has no funds available for the completion of a construction of an 85-condominium unit project at Tallapoosa County. According to the Debtor, unless the buildings are completed and the condominiums sold, the Debtor has no ability to repay its creditors other than Empire Financial. Empire Financial has agreed to extend $550,000 initial loan to the Debtor, and additional $3,865,000 towards the completion of the project. Loan Agreement with Empire Financial The Debtor was able to buy a real property in Tallapoosa County from Stoneview Summit Development Inc. on Sept. 26, 2005. Empire Financial closed on the original transaction to acquire the real property from Stoneview Summit and fund the construction of 85 condominium units in Tallapoosa County. The Debtor was able to pre-sell the 85 condo units pursuant to a loan agreement it signed with Empire Financial. The value of the real property owned by the Debtor and the project at its present stage of completion is estimated at $1,000,000 more than the current debt due Empire Financial, which is about $17,940,000. Interest on the Debtor's outstanding loan from Empire Financial is at $145,000 per month. From the pre-sold 85 condo units, the Debtor obtained cash deposits from the purchasers of about 10% to 20% of the agreed purchase price. Under the terms of each purchase contract, the deposits were to partially fund the purchase price due at closing. Dispute with Stoneview Summit and EAS Subsequent to the acquisition of the real property, the Debtor entered into a development agreement with Stoneview Summit to construct the condo buildings at a maximum price under the funding of Empire Financial. In contrast, Stoneview Summit engaged a general contractor, EAS Contractors Inc. on a cost plus basis. Empire had already advanced funds at the Debtor's request. However, the payment claims of Stoneview Summit and EAS exceeded the amounts funded under the loan agreement the Debtor had with Empire Financial. Stoneview Summit claims that it obtained the Debtor's consent, which the Debtor denies, to use deposits to fund the construction and other expenses. As a result, no deposits remain available for use by the Debtor if authorized by the purchasers or by order of the Court. As a result of the dispute between the Debtor and Stoneview Summit, the Debtor entered into an agreement on Aug. 23, 2007, through which Stoneview Summit agreed to vacate the project to enable the Debtor to secure another contractor to complete it. EAS and various suppliers and sub-contractors have since filed liens against the project and a result, Empire Financial became unwilling to advance additional funds without the assurance of repayment on a secured administrative basis. About Lake Martin Dothan, Alabama-based Lake Martin Partners LLC owns an 18 acre condominium development project on Lake Martin in Tallapoosa County, Alabama. The Debtor filed for chapter 11 bankruptcy on Oct. 19, 2007 (Bankr. M.D. Ala. Case No. 07-11470). The Debtor's schedules disclosed total assets of $14,140,003 and total liabilities of $27,836,721. LAKE MARTIN: Wants R. Smith and D. Huskey as Special Counsels ------------------------------------------------------------- Lake Martin Partners LLC asks the U.S. Bankruptcy Court for the Middle District of Alabama for permission to retain the law office of Rufus R. Smith, Jr., & Associates and Dow T. Huskey, Esq., as its special counsels. The Debtor intends to retain the services of Messrs. Smith and Huskey to pursue damages and other recoveries against Stoneview Summit Development Inc., Stoneview Summit Inc, The Profile Group Inc, and others who are associated with them and are liable to the Debtor due to breach of contract and otherwise under the terms of an employment agreement. Messrs. Smith and Husky will receive a sum of money equal to 40% of the amount received by suit or judgment from the litigation against Stoneview Summit and parties. The Debtor assures the Court that Messrs. Smith and Huskey do not represent any interest adverse to the estate and their employment is in the best interest of the estate. The professionals can be reached at: Rufus R. Smith, Jr. Rufus R. Smith, Jr., & Associates 129 South Street, Andrews Street, Suite 102 Dothan, AL 36301 http://www.rufusrsmithjrandassociates.com/ Dow. T. Huskey, Esq. 112 West Adams Street Dothan, AL 36303 Phone: (334) 794-3366 Telecopier: (334) 794-7292 About Lake Martin Dothan, Alabama-based Lake Martin Partners LLC owns an 18 acre condominium development project on Lake Martin in Tallapoosa County, Alabama. The Debtor filed for chapter 11 bankruptcy on Oct. 19, 2007 (Bankr. M.D. Ala. Case No. 07-11470). The Debtor's schedules disclosed total assets of $14,140,003 and total liabilities of $27,836,721. LEVITT AND SONS: Homeowners Object to Home Sale Contracts Closing ----------------------------------------------------------------- Kenneth and Sandra Schroeder, and David and Sandy Schnee ask the U.S. Bankruptcy Court for the Southern District of Florida to reconsider the request of Levitt and Sons LLC and its debtor- affiliates' to close on sales of homes, honor certain prepetition contract obligations and sell homes postpetition in the ordinary course of business. In addition, the Schroeders and Schnees join in the request of Eugene M. and Andrea I. Yaver to compel the rejection of certain executory contract and return of deposit amounts. As reported in the Troubled Company Reporter on Nov. 26, 2007, the Debtors' obtained authority from the Honorable Raymond B. Ray to close on certain pre-bankruptcy home sale contracts. The Debtors were authorized, but not directed to: -- close on sales of encumbered homes once construction is finished and all other requirements are met; -- honor certain existing pre-bankruptcy contract obligations to homebuyers and others, including payment of commissions due to current or former employees under the Company Sales and Design Incentive Plans, which are due upon the closing of an Encumbered Home to the Debtors' workforce and persons who have or might assert mechanic's liens against the Encumbered Home to be sold; and -- sell Encumbered Homes postpetition in the ordinary course of business. Homeowners Want Contracts & Deposit Returns Rejected The Schnees relate that they did not receive adequate notice to file their objection to the Debtors' Motion before the hearing on the first day motions on Nov. 13, 2007, one day after a federal holiday and less than one business day after the date of bankruptcy filing. The Schroeders entered into a contract to purchase a home to be built by Levitt and Sons of Cherokee County, LLC, located at 401 Larkspur Drive, Canton, Georgia. The Schnees, on the other hand, contracted with Levitt Cherokee located at 449 Larkspur Drive, Canton, Georgia. According to the Schnees and Schroeders, issues concerning the Debtors' ability to complete the Contract and the development continue to exist. Both contend that their Contracts constitute an executory contract in accordance with Section 365 of the Bankruptcy Code. David Marshall Brown, Esq., at David Marshall Brown, P.A., in Fort Lauderdale, Florida, says that the Debtors are under certain obligations to complete amenities associated with the development. The Schnees and Schroeders believe that construction on the amenities has ceased. He adds that the Debtors have provided no evidence establishing their ability to complete the Contract and to fulfill the obligations with respect to the development, including completing construction of amenity buildings. Mr. Brown tells the Court that it is not only the Debtors' ability to complete the Contracts, but also their ability to complete the amenity buildings that must be addressed. The Contract involves a development that creates a lifestyle for the residents. The inability to complete the amenity buildings and other contractual obligations constitutes a default, which must be completed before assumption, he asserts. Moreover, the work completed by the Debtors are unacceptable and there are numerous problems that must be addressed before proceeding with any additional work, Mr. Brown relates. Since it does not appear that the Debtors will be able to fulfill their obligations with respect to the Contract, Mr. Brown notes, the Schnees and Schroeders ask the Court to compel the Debtors to immediately reject the Contracts, and direct the return of the deposits the homeowners remitted upon rejection. The homeowners also seek documentation from the Debtors identifying where the deposit is being maintained. About Levitt and Sons Based in Fort Lauderdale, Florida, Levitt and Sons LLC -- http://www.levittandsons.com/-- is the homebuilding subsidiary of Levitt Corporation (NYSE:LEV). Levitt Corp. -- http://www.levittcorporation.com/-- together with its subsidiaries, operates as a homebuilding and real estate development company in the southeastern United States. The company operates in two divisions, homebuilding and land. The homebuilding division primarily develops single and multi-family homes for adults and families in Florida, Georgia, Tennessee, and South Carolina. The land division engages in the development of master-planned communities in Florida and South Carolina. Levitt and Sons LLC and 38 of its homebuilding affiliates filed for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead Case No. 07-19845). Paul Singerman, Esq. and Jordi Guso, Esq., at Berger Singerman, P.A., represent the Debtors in their restructuring efforts. The Debtors chose AP Services, LLC as their crisis managers, and Kurtzman Carson Consultants, LLC as their claims and noticing agent. Levitt Corp., the Debtors' parent company, did not file for Chapter 11 protection. The Debtors' latest consolidated financial condition as of Sept. 30, 2007 reflect total assets of $900,392,000, and total liabilities of $780,969,000. (Levitt and Sons Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) LEVITT AND SONS: Laurel Canyon Residents Want Grace Period ---------------------------------------------------------- The Ad Hoc Group of Residents of Seasons at Laurel Canyon seeks to obtain a sufficient transitional period before Levitt and Sons LLC and certain of its debtor-affiliates can abandon any of their real estate property, including the residents' Laurel Canyon community. As reported in the Troubled Company Reporter on Nov. 23, 2007, the Debtors sought permission from the U.S. Bankruptcy Court for the Southern District of Florida to abandon certain real estate properties in which they "have no equity and which are financially burdensome to maintain." As disclosed at the "first day hearings" in their Chapter 11 cases, the Debtors have been in discussions with their senior lenders regarding the willingness to provide additional financing to complete vertical construction necessary to complete sales of homes, including homes that are currently under contract. Immediate Abandonment is Improper The ad hoc group of residents relates that one of the properties owned by the Debtors and securing the Wachovia Bank, National Associations, credit facilities is a property generally referred to as Seasons at Laurel Canyon. The Laurel Canyon Group is comprised of 148 homes in Seasons at Laurel Canyon development as of November 21, 2007, and is also the holder of 14 contracts for the purchase of homes in the Development. Seasons at Laurel Canyon is an active adult community developed by Levitt and Sons of Cherokee County, LLC. Each member of the Laurel Canyon Group has a claim in the Levitt Cherokee Chapter 11 case and possibly in the bankruptcy cases of some or all of the related debtors, David Marshall Brown, Esq., at David Marshall Brown, P.A., in Fort Lauderdale, Florida, informs the Court. The residents of the Development are members of the Seasons at Laurel Canyon Community Association, Inc. The Association has two classes of members: -- Class A members, whose membership includes homeowners who hold record title to individual lots in the Development; and -- Levitt Cherokee, as sole Class B member, who has the right to appoint the directors of the Association. Levitt Cherokee currently controls all actions of the Association, including the approval of all budgets, expenditures and third party contracts and has the check-writing power for the Association, Mr. Brown relates. While the Laurel Canyon Group recognizes the Wachovia Debtors' desire to abandon property in which they have no equity, the request for an immediate abandonment is improper, Mr. Brown tells Judge Ray, adding that an immediate abandonment of the collateral will result in irreparable damage to the Development and put the safety and welfare of the residents in jeopardy. The Laurel Canyon Group does not seek to prevent the Wachovia Debtors' proposed abandonment of the collateral and interests in the Development granted to Wachovia. Rather, the group simply seeks a sufficient transition period before any abandonment, requiring that the Wachovia Debtors implement procedures to facilitate a transition of the collateral and interests identified to Wachovia in a manner that will allow Wachovia the opportunity to arrange for the continuation of any services currently being overseen by the Wachovia Debtors in the Development. Mr. Brown states that, before abandoning the rights and interests in the collateral, the Wachovia Debtors should be required to identify all of the collateral and interests, which they consider are encumbered by Wachovia's claims and take the steps necessary to ensure an efficient transfer of the collateral and interests. To minimize damages to the Laurel Canyon Group and Wachovia, Mr. Brown says, a transition period is warranted and procedures are needed to facilitate the efficient turnover of the collateral and interests granted to Wachovia. According to Mr. Brown, the procedures should: (a) at a minimum, identify the Development property that is subject to abandonment and ensure that control of the property to be abandoned is always vested in a single party; and (b) provide for the continuation of utility services to the Development, since a disruption would leave the Development without street and security lighting or an ability to maintain sewage facilities. The Laurel Canyon Group believes that much of the collateral and interests consists of the property in or related to the Development, including all common areas, which are necessary for the homeowners to continue to live in the community. The Laurel Canyon Group is also uncertain if Levitt Cherokee's Class B membership in the Association is part of Wachovia's collateral, Mr. Brown notes. To the extent that it is, the Laurel Canyon Group is exposed to the very real possibility that an immediate abandonment of the Class B membership may leave critical operations funded by the Association in limbo, negatively impacting the Laurel Canyon Group and the value of Wachovia's collateral, Mr. Brown tells the Court. As applicable, the abandonment of Class B membership by Levitt Cherokee should be conducted such that Wachovia or its designated agent can seamlessly assume its responsibilities as the Class B member and perform its necessary duties without interruption of any services in the Development. New directors for the Association will need to be appointed and steps taken to give Wachovia the authority to write checks on the Association accounts. Wachovia Reserves Right to Object Wachovia Bank states that the loans it provided to the Debtors, which currently exceed $100,000,000, are secured by, inter alia, first priority liens on real and personal property of the Debtors and on various projects in Florida, Georgia and South Carolina. Robert N. Gilbert, Esq., at Carlton Fields, P.A., in West Palm Beach, Florida, relates, on Wachovia's behalf, that the Debtors recently filed a motion seeking to abandon the real property securing the Indebtedness in the event parties cannot reach mutually acceptable agreements concerning the terms of additional financing requested by the Debtors. Hearing on the Debtors' Abandonment Motion is set for November 27, 2007. Mr. Gilbert tells the Court that the abandonment is premature at this time. Wachovia, in the abundance of caution, files an objection to preserve its right to object to the abandonment. If Wachovia and the Debtors do not reach an agreement concerning the relief requested in the Abandonment Motion, Wachovia reserves the right to supplement the Objection on or before November 26. About Levitt and Sons Based in Fort Lauderdale, Florida, Levitt and Sons LLC -- http://www.levittandsons.com/-- is the homebuilding subsidiary of Levitt Corporation (NYSE:LEV). Levitt Corp. -- http://www.levittcorporation.com/-- together with its subsidiaries, operates as a homebuilding and real estate development company in the southeastern United States. The company operates in two divisions, homebuilding and land. The homebuilding division primarily develops single and multi-family homes for adults and families in Florida, Georgia, Tennessee, and South Carolina. The land division engages in the development of master-planned communities in Florida and South Carolina. Levitt and Sons LLC and 38 of its homebuilding affiliates filed for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead Case No. 07-19845). Paul Singerman, Esq. and Jordi Guso, Esq., at Berger Singerman, P.A., represent the Debtors in their restructuring efforts. The Debtors chose AP Services, LLC as their crisis managers, and Kurtzman Carson Consultants, LLC as their claims and noticing agent. Levitt Corp., the Debtors' parent company, did not file for Chapter 11 protection. The Debtors' latest consolidated financial condition as of Sept. 30, 2007 reflect total assets of $900,392,000, and total liabilities of $780,969,000. (Levitt and Sons Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) LIFEPOINT HOSPITALS: Board Okays $150 Mil. Share Repurchase Plan ---------------------------------------------------------------- LifePoint Hospitals Inc.'s board of directors has authorized a share repurchase program of up to $150 million of the company's common stock over the next 12 months. The company, which had approximately 58.1 million shares of common stock outstanding as of Sept. 30, 2007, is not obligated to repurchase any specific number of shares under the program. Based on the Nov. 26, 2007, closing price, approximately 5.1 million shares, or 9% of the company's shares outstanding, could be repurchased for $150 million. Purchases under the program may be funded with a portion of the company's cash on hand, cash generated from operations and funds available under the company's Amended and Restated Credit Facility. "We are pleased to disclose this new authorization, our second in the past five years," William F. Carpenter III, president and chief executive officer of LifePoint Hospitals Inc., said. "This latest action underscores our long-term commitment to enhancing stockholder value." Repurchases under the program may be made through open market purchases or privately negotiated transactions in accordance with applicable federal securities laws, including Rule 10b-18. The timing, amount, manner and price of any repurchases, if any, will be determined by the company, in its discretion, and will depend upon, among other things, the stock price, economic and market conditions and such other factors as the Company considers appropriate. The program may be extended, suspended or discontinued at any time. About LifePoint Hospitals Based in Brentwood, Tennessee, LifePoint Hospitals Inc. (NASDAQ: LPNT) -- http://www.lifepointhospitals.com/-- is a hospital company that provides healthcare services in non-urban communities in 18 states. Of the company's 49 hospitals, 44 are in communities where LifePoint Hospitals is the sole community hospital provider. LifePoint Hospitals' non-urban operating strategy offers continued operational improvement by focusing on its five core values: delivering compassionate, high quality patient care; supporting physicians; creating an outstanding environment for employees; providing unmatched community value; and ensuring fiscal responsibility. LifePoint Hospitals is affiliated with approximately 21,000 employees. * * * Moody's Investor Services placed LifePoint Hospitals Inc.'s probability of default rating at 'Ba3' in September 2006 and its bank loan debt rating at 'Ba2' in May 2007. The ratings still hold to date with a stable outlook. MACO INC: Files Schedules of Assets and Liabilities --------------------------------------------------- Maco Steel Inc. submitted to the U.S. Bankruptcy Court for the Western District of Michigan its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property B. Personal Property $2,495,765 C. Property Claimed as Exempt D. Creditors Holding $10,126,047 Secured Claims E. Creditors Holding Unsecured Priority Claims F. Creditors Holding $2,014,236 Unsecured Nonpriority Claims ---------- ----------- $2,495,765 $12,140,283 Headquartered in Belmont, Michigan, Maco Steel, Inc. -- http://www.macosteel.com/-- is a steel supply and machining company specializing in flam and plasmka cutting, CNC machining, Blanchard grinding and welding/fabricating. Through its non- debtor affiliate Maco Resource, LLC, the company employs approximately 50 employees for its business operations in Rockford, Michigan. The company filed for chapter 11 protection on Oct. 5, 2007 (Bankr. W.D. Mich. Case No. 07-07346). Thomas P. Sarb, Esq., John T. Piggins, Esq., and Robert D. Wolford, Esq., at Miller Johnson, represent the Debtor. MACO STEEL: Committee Wants to Hire Barnes & Thornburg as Counsel ----------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in Maco Steel Inc.'s bankruptcy case asks the U.S. Bankruptcy Court for the Western District of Michigan to retain Barnes & Thornburg LLP as its counsel, nunc pro tunc Nov. 8, 2007. Barnes & Thornburg will: a) consult with the Debtor's professionals and representatives concerning the administration of this case; b) prepare and review pleadings, motions and correspondence; c) appear at and participate in proceedings before this Court; d) provide legal counsel to the Committee in its investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtor, the operation of the Debtor's business, and any other matters relevant to this case; e) analyzing the Debtor's proposed use of cash collateral and debtor-in-possession financing, if any; f) advise the Committee with respect to its rights, duties and powers in this case; g) assist the Committee in analyzing the claims of the Debtor's creditors and in negotiating with such creditors; h) assist the Committee in its analysis of and negotiations with the Debtor or any third party concerning matters related to, among other things, the terms of a sale, plan of reorganization or other conclusion of this case; i) assist and advise the Committee as to its communications to the general creditor body regarding significant matters in this case; j) assist the Committee in determining a course of action that best serves the interests of the unsecured creditors; and k) perform such other legal services as may be required under the circumstances of this case and are deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code. David M. Linick, Chairman of the Creditors' Committee, disclosed that the Firm's professionals bill: Professional Hourly Rate ------------ ----------- Patrick E. Mears, Esq. $400 John T. Gregg, Esq. $265 Laura Kane (Paralegal) $155 The Firm has not received a carve-out or retainer in connection with its retention in this Chapter 11 case. However, the Firm reserves the right to seek a carve-out or payment of a retainer by separate motion. Mr. Gregg assures the Court that the Firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Gregg can be reached at: John T. Gregg, Esq. Barnes & Thornburg LLP One North Wacker Drive Suite 4400 Chicago, Illinois 60606-2833 Telephone (312) 357-1313 Fax (312) 759-5646 http://www.btlaw.com/ Headquartered in Belmont, Michigan, Maco Steel, Inc. -- http://www.macosteel.com/-- is a steel supply and machining company specializing in flam and plasmka cutting, CNC machining, Blanchard grinding and welding/fabricating. Through its non- debtor affiliate Maco Resource, LLC, the company employs approximately 50 employees for its business operations in Rockford, Michigan. The company filed for chapter 11 protection on Oct. 5, 2007 (Bankr. W.D. Mich. Case No. 07-07346). Thomas P. Sarb, Esq., John T. Piggins, Esq., and Robert D. Wolford, Esq., at Miller Johnson, represent the Debtor. MARCAL PAPER: Court Approves Bidding Procedure for Sale of Assets ----------------------------------------------------------------- The Honorable Morris Stern of the United States Bankruptcy Court for the District of New Jersey approved Marcal Paper Mills Inc.'s proposed procedure for the sale of its business to NexBank SSB, subject to higher and better offers. At the auction date on Jan. 15, 2007, NexBank SSB will be entitled to credit bid up to the full amount of the amount outstanding under the second lien loan agreement, including all interest accrued until the action date, pursuant to Section 363(k) of the Bankruptcy Code. The Debtor tells the Court that NexBank SSB has at least $64 million under the second lien loan agreement, and reserves the right to increase that amount, in addition to the current credit bid amount of $35 million, up to the remaining portion of the indebtedness. Deadline for qualified bidders to submit competing proposals due Jan. 14, 2008, at 12:00 p.m. (prevailing eastern time). A sale hearing of the acquired assets has been set on Jan. 15, 2008, at 2:00 p.m. (prevailing eastern time). As reported in the Troubled Company Reporter on Oct. 4, 2007, the Debtor informed the Court of its intent to proceed with an amended plan of reorganization and sale process. As reported in the Troubled Company Reporter on Nov 12, 2007, NexBanc offered $121.6 million for the assets, which includes a credit bid of $35 million and a $6 million cash. About Marcal Paper Mills Based in Elmwood Park, New Jersey, Marcal Paper Mills Inc. -- http://www.marcalpaper.com/-- is a privately-held, fourth generation family business. Founded in 1932, it employs over 900 people in its Elmwood Park, New Jersey and Chicago, Illinois manufacturing operations. The company produces over 160,000 tons of finished paper products, including bath tissue, kitchen towels, napkins and facial tissue, distributed to retail outlets for home consumption and to distributors for away-from- home use in hotels, restaurants, hospitals, offices and factories. The Debtor filed for chapter 11 protection on Nov. 30, 2006 (Bankr. D. N.J. Case No. 06-21886). Gerald H. Gline, Esq., and Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman & Leonard P.A. represent the Debtor. Kenneth Rosen, Esq., and Mary E. Seymour, Esq., at Lowenstein Sandler PC represent the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. MEDICAL SOLUTIONS: Sept. 30 Balance Sheet Upside-Down by $2.1 Mil. ------------------------------------------------------------------ Medical Solutions Management Inc.'s consolidated balance sheet at Sept. 29, 2007, showed $5.2 million in total assets and $7.3 million in total liabilities, resulting in a $2.1 million total shareholders' deficit. At Sept. 29, 2007, the company's consolidated balance sheet showed strained liquidity with $4.9 million in total current assets available to pay $6.4 million in total current liabilities. The company reported a net loss of $113.7 million on total revenue of $1.1 million for the third quarter ended Sept. 29, 2007, comared with a net loss of $860,689 on total revenue of $278,538 in the same period last year. Revenue increased in the three months ended Sept. 29, 2007, primarily due to the increase in the number of clinics under agreement with the company from approximately 30 in the third quarter of 2006 to approximately 52 in the third quarter of 2007. The net loss for the three months ended Sept. 29, 2007, was primarily attributable to non-cash charges for debt extinguishment loss in conjunction with debt modification and the change in estimated fair value of warrants in relation to the Warrant and Debenture Amendment Agreement entered into on July 10, 2007, of $103.2 million and $9.3 million respectively. Operationally, the loss loss was driven mainly from selling, general and administrative costs incurred to continue to grow revenue and support operations. For the nine months ended Sept. 29, 2007, the company reported total revenue of $2.6 million, compared to total revenue of $685,704 for the same nine months ended Sept. 30, 2006. Net loss was $146.2 million for the nine months ended Sept. 29, 2007, compared with a net loss of $2.9 million in the corresponding period last year. The net loss for the nine months ended Sept. 29, 2007, was primarily attributable to a revolving line of credit financing expense of $21.5 million and a note extension expense of $8.7 million which were recorded in the quarter ended March 31, 2007. Additionally $103.2 million and $9.3 million of expense was for the debt extinguishment loss in conjunction with debt modification and change in the estimated value of warrants in relation to the Warrant and Debenture Amendment Agreement entered into on July 10, 2007. 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?25d1 Going Concern Doubt Michael F. Cronin, CPA, in Rochester, New York, expressed substantial doubt about Medical Solutions Management Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. Mr Cronin reported that the company's losses have resulted in an accumulated deficit of $4.7 million as of Dec. 31, 2006, and operating activities consumed $2.9 million in cash. About Medical Solutions Headquartered in Marlborough, Massachusetts, Medical Solutions Management Inc. (OTC BB: MSMT.OB) -- markets and sells orthopedic and podiatric durable medical equipments in the United States. It enables orthopedic and podiatric practices to dispense an array of durable medical equipment directly to their patients during office visits through its turnkey programs. The company also provides billing services, inventory management, and insurance verifications, as well as offers related management services. MERRILL LYNCH: Fitch Rates $3.1 Million Class B-5 Certs. at B+ -------------------------------------------------------------- Fitch Ratings has taken these rating actions on one Merrill Lynch Mortgage Investor transaction. Affirmations total $86.4 million. In addition, $3.1 million is placed on Rating Watch Negative. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: MLMI 2005-HE1 -- $37.1 million class A affirmed at 'AAA' (BL: 65.41, LCR: 8.07); -- $21.9 million class M-1 affirmed at 'AA' (BL: 41.25, LCR: 5.09); -- $16 million class M-2 affirmed at 'A' (BL: 13.81, LCR: 1.7); -- $2.5 million class M-3 affirmed at 'A-' (BL: 12.46, LCR: 1.54); -- $2.5 million class B-1 affirmed at 'BBB+' (BL: 11.23, LCR: 1.39); -- $2 million class B-2 affirmed at 'BBB' (BL: 10.22, LCR: 1.26); -- $2 million class B-3 affirmed at 'BBB-' (BL: 9.18, LCR: 1.13); -- $2 million class B-4 affirmed at 'BB+' (BL: 8.52, LCR: 1.05); -- $3.1 million class B-5 rated 'B+' (BL: 7.72, LCR: 0.95) placed on Rating Watch Negative. Deal Summary -- Originators: Fieldstone (25%), Fremont (27%) -- 60+ day Delinquency: 21.26%, -- Realized Losses to date (% of Original Balance): 0.68%; -- Expected Remaining Losses (% of Current Balance): 8.10%; -- Cumulative Expected Losses (% of Original Balance): 2.45%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. MERRILL LYNCH: Fitch Downgrades Rating on Class B3 Loans to B ------------------------------------------------------------- Fitch has taken these rating actions on Merrill Lynch Mortgage Investors, series 2004-HE1 -- Class M1 affirmed at 'AA'; -- Class M2 affirmed at 'A'; -- Class B1 affirmed at 'BBB+'; -- Class B2 rated 'BBB' is placed on Rating Watch Negative; -- Class B3 downgraded to 'B' from 'BBB-' and removed from Rating Watch Negative. The underlying collateral for the transaction above consists of fixed- and adjustable-rate mortgage loans secured by first and second liens on one- to four-family residential properties extended to subprime borrowers. The mortgage loans were originated or acquired by various originators and subsequently purchased by Merrill Lynch Mortgage Capital, Inc. The affirmations reflect a satisfactory relationship between credit enhancement and future loss expectations and affect approximately $18.4 million of outstanding certificates. The $4.5 million of outstanding certificates being downgraded classes and the $1.9 million class placed on Rating Watch Negative reflect deterioration in the relationship of CE to future loss expectations. The overcollateralization is currently at the target amount due to the recent step-down. Prior to step-down there were several months where the OC was below the target amount due to monthly realized losses exceeding excess spread. Currently, the OC is providing 5.78% of CE to the most subordinate bond and 16.48% of the remaining loans are 60+ delinquent (including loans in bankruptcy, foreclosure, and REO). The servicer for the aforementioned transaction in Litton Loan Servicing, rated 'RPS1/Rating Watch Negative'. MICHAEL CLIFFORD: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Michael P. Clifford 12040 Avondale Place, Northeast Redmond, WA 98052 Bankruptcy Case No.: 07-15658 Type of Business: The Debtor owns Clifford Quality Landscaping, Inc., whose Chapter 11 bankruptcy case was dismissed on October 2007 (Bankr. W.D. Wash. Case No. 06-14360). Chapter 11 Petition Date: November 27, 2007 Court: Western District of Washington (Seattle) Judge: Thomas T. Glover Debtor's Counsel: Larry B. Feinstein, Esq. Vortman & Feinstein 500 Union Street, Suite 500 Seattle, WA 98101 Tel: (206) 223-9595 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Darci Dodson-Clifford $420,000 16759 Snow Grass Mountain Road Monroe, WA 98272 Berkey Supply, Inc. $46,390 15500 Woodinville-Redmond Road #C100 Woodinville, WA 98072 Bank of America $34,209 P.O. Box 30750 Los Angeles, CA 90030-0750 Pinnacle Isuzu $33,773 Ptopsoils $27,896 Vasile Paul $24,567 U.S. Bank Commercial Loan $23,717 Wells Fargo Business Line $14,774 Bell & Ingram $14,546 American General $13,154 Chase $12,642 American Express $12,438 Idearc Media Corp. $10,932 Key Bank $10,733 Discover Card $7,652 Home Depot $7,445 Charter Bank $5,082 Bark King $4,567 Verizon $4,550 Bullivant Houser $4,355 MORGAN CREEK/PERMIAN: Fitch Rates 7.46% Facility Bonds at B/RR4 --------------------------------------------------------------- Fitch has assigned a 'B/RR4' rating to the 7.48% Decordova/Permian Basin secured facility bonds that mature Jan. 1, 2017. In addition, Fitch assigns a 'B/RR4' rating to the 7.46% Morgan Creek/Permian Basin secured facility bonds that mature Jan. 1, 2015. The Rating Outlook of the primary lease obligor Texas Competitive Electric Holding (TCEH; Issuer Default Rating 'B'), and the co-obligor Energy Future Competitive Holding (EFCH; IDR 'B) are Stable. Both series of bonds are secured by certain peaking generation units, the related ground leases and rights under the leases. The facilities are located in Texas. The Decordova/Permian bonds are secured by four Decordova peaking units with total capacity of 260 megawatts and two Permian Basin units with 130MW of capacity. The Decordova and Permian units started commercial operation in 1989. The Morgan Creek/Permian Basin bonds are secured by nine peaking units with 585MW of total capacity. The six Morgan Creek units and three Permian Basin units were placed into service in 1988 and 1987, respectively. The plants are maintained to utility standards and there have been no significant operating issues. There are no plans to retire or mothball the units. Fitch valued the peaking unit collateral packages in a stress scenario to establish estimates for recovery value to position the ratings of the secured facility bonds relative to the IDR of TCEH, which includes an average recovery assumption of 30%-50%. Fitch used its proprietary power pricing model to calculate the net present value of future cash flows from the units based on a single dispatch and price scenario and on an alternate scenario that uses the observed volatility of power prices to estimate the option value of the facilities, with cash flows discounted at a 10% discount rate. Fitch notes that it is more challenging to value peaking units than other power generation assets that have more predictable usage. Fitch accorded relatively less weight to future option value. In Fitch's opinion, the peaking units have average recovery prospects and are thus rated at the same 'B' level as the IDR of the lessee and co-obligor. MORGAN STANLEY: Moody's Lowers Junks Ratings on Three Classes ------------------------------------------------------------- Moody's Investors Service downgraded the ratings of eight tranches issued in three separate mortgage transactions. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. The deals being reviewed have experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses and stepdown. The timing of losses coupled with passing of performance triggers has caused the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: Morgan Stanley ABS Capital I Inc. Trust 2004-SD1 -- Cl. M-2, Downgraded to Baa1 from A2 -- Cl. B, Downgraded to Caa1 from Baa2 Issuer: Morgan Stanley ABS Capital I Inc. Trust 2004-SD2 -- Cl. M-2, Downgraded to Baa1 from A2 -- Cl. B-1, Downgraded to B2 from Baa2 -- Cl. B-2, Downgraded to Caa2 from Ba2 Issuer: Morgan Stanley ABS Capital I Inc. Trust 2004-SD3 -- Cl. M-2, Downgraded to Baa1 from A2 -- Cl. B-1, Downgraded to B2 from Baa2 -- Cl. B-2, Downgraded to Caa1 from Baa3 MOTHERS WORK: S&P Hold 'B' Rating and Revises Outlook to Negative ----------------------------------------------------------------- Standard & Poor's Ratings Services changed its outlook on Philadelphia-based Mothers Work Inc. to negative from stable. At the same time, S&P affirmed the 'B' corporate credit rating on the company. "The outlook change is based on performance being below expectations, merchandising difficulties, and increased competitive pressures," said Standard & Poor's credit analyst David Kuntz. S&P expect performance to remain challenged because of increased competition and the higher risk of substitute merchandise. MOVIE GALLERY: Panel Taps Imperial Capital as Financial Advisor --------------------------------------------------------------- The Official Committee of Unsecured Creditors in Movie Gallery, Inc. and its debtor-affiliates' bankruptcy cases seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to retain Imperial Capital LLC as its financial advisor. Imperial Capital will: a. advise, to the extent it relates to the capital restructuring plan, the Committee regarding the Debtors' business plans, cash flow forecasts and financial projections; b. advise the Committee with respect to available capital restructuring, sale and financing alternatives including but not limited to a Debtor-in-Possession facility, including recommending specific courses of action and assisting with the design, structuring and negotiation of alternative restructuring or transaction structures; c. advise, to the extent it relates to the capital restructuring plan, the Committee regarding financial information prepared by the Debtors, and in its coordination of communication with interested parties and their advisors; d. assist and advise the Committee and its counsel in the development, evaluation and documentation of any plan, financing or strategic transactions and strategic alternatives for recovery, and the consideration that is to be provided to unsecured creditors under them; and e. provide testimony in the bankruptcy court in connection with the services. The Committee executed an engagement letter on Oct. 22, 2007, to employ Imperial. According to the Engagement Letter, Imperial will receive: a. $125,000 as a flat monthly advisory fee; b. a prorated monthly fee for October 2007; c. monthly reimbursement for reasonable out-of-pocket expenses incurred in connection with the services. These expenses include, but are not limited to, reasonable attorney's fees and expenses, travel, out-of-town accommodations, ground transportation and meals, overnight delivery, database access charges, and telephone, facsimile, postage, printing and duplication costs, document materials and similar items; and d. $2,000,000 as a transaction fee, payable upon closing of a restructuring as defined in the Engagement Letter at the Committee's discretion. The Debtors will indemnify and hold Imperial harmless, and provide contribution against the liabilities arising out of, or in connection with, the retention of Imperial by the Committee, except for losses, claims, damages or liabilities incurred that are determined to have primarily resulted from bad faith, breach of fiduciary duty or gross negligence. The parties' Engagement Letter also contains a forum selection provision governing any disputes that may arise with respect to Imperial's provision of services to the Committee, except for indemnification claims. The forum selection provision requires any disputes relating to Imperial's provision of services be resolved by pending AAA arbitration in New York. Paul Aronzon, a managing director and executive vice president of Imperial, assures the Court that his firm does not represent any interest adverse to the Debtors' estates or their creditors, and is disinterested within the meaning of Sections 327(a), 328 and 1103(b) of the Bankruptcy Code. About Movie Gallery Based in Dothan, Alabama, Movie Gallery Inc. -- http://www.moviegallery.com/-- is a home entertainment specialty retailer. The company owns and operates 4,600 retail stores that rent and sell DVDs, videocassettes and video games. The company and its debtor-affiliates filed for Chapter 11 protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq., at Kutak Rock LLP, is the Debtors' local counsel. The Debtors' claims & balloting agent is Kutzman Carson Consultants LLC. When the Debtors' filed for protection from their creditors, they listed total assets of $891,993,000 and total liabilities of $1,419,215,000. The Official Committee of Unsecured Creditors has selected Robert J. Feinstein, Esq., James I. Stang, Esq., Robert B. Orgel, Esq., and Brad Godshall, Esq., at Pachulski Stang Ziehl & Jones LLP, as its lead counsel, and Brian F. Kenney, Esq., at Miles & Stockbridge PC, as its local counsel. (Movie Gallery Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) The Debtors' spokeswoman Meaghan Repko said that the Plan will not be filed before November 27, and the company does not expect to exit bankruptcy protection before the second quarter of 2008. MOVIE GALLERY: Wants to Pay Obligations to Smaller Suppliers ------------------------------------------------------------ Movie Gallery, Inc. and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of Florida to pay certain prepetition obligations owed to smaller movie studios and game vendors who commit to to continue to supply movies or games on favorable trade terms. The Debtors sought and gained the Court's authority to enter into accommodation agreements with major movie studio suppliers and pay prepetition obligations in connection with the agreements. In addition to the movies purchased from the major studios, the Debtors also purchase movie titles and games from many other smaller movie studios and game vendors. The Debtors believe that just as the major studios are indispensable to the success of the Debtors' reorganization, stabilizing their relationships with the smaller suppliers is also a critical component of their overall restructuring. Many of the smaller suppliers deliver products to the Debtors through revenue sharing agreements, written or unwritten, that are profitable for the Debtors. Similar to the Revenue Sharing Agreements with the major studios, under Revenue Sharing Agreements with the smaller suppliers, the Debtors are obligated to pay the applicable supplier a fixed percentage of the proceeds of any rentals or sales of the movies or games for a specific period of time. Under the Revenue Sharing Agreements, the Debtors accrue payment obligations over time. Accounting for Revenue Sharing Agreements is complicated and may require auditing of title-by-title rental data. The Revenue Share Obligations are typically calculated on a monthly basis, and given the accounting process, are paid in arrears. In addition to the formal and informal Revenue Sharing Agreements whereby the purchase price effectively varies according to rental performance, the Debtors also purchase movies and games from smaller suppliers pursuant to more traditional fixed-cost purchase arrangements. This arrangement have also traditionally been profitable for the Debtors. Unlike many of the major studios, the small suppliers generally did not eliminate the Debtors' trade credit prior to the Petition Date, and the Debtors believe it is important for their reorganization that they be able to continue receiving Movies and Games from all smaller suppliers on favorable terms on a going forward basis. Richard M. Cieri, Esq., at Kirkland & Ellis LLP, in New York, New York, says the Debtors expect that the approximate aggregate amount of prepetition obligations currently owed to the dozens of smaller suppliers is approximately $4,000,000. However, the Debtors are not able to estimate precisely the amount of future Revenue Share Obligations that may be attributable to titles delivered prior to the Petition Date because it depends on future rental performance. Mr. Cieri explains maintaining positive relationships with all small suppliers is important to the Debtors' ongoing viability and their reorganization efforts. The Debtors believe that the value of maintaining the small supplier relationships far outweighs the cost of continuing to pay the relatively de minimus amount of prepetition obligations at issue. Due to the profitable nature of these small supplier relationships, the Debtors submit that all creditors, not just the small suppliers, will be benefited from the small suppliers' commitment to continue to supply the Debtors with Movies and Games on a going-forward basis on favorable terms. About Movie Gallery Based in Dothan, Alabama, Movie Gallery Inc. -- http://www.moviegallery.com/-- is a home entertainment specialty retailer. The company owns and operates 4,600 retail stores that rent and sell DVDs, videocassettes and video games. The company and its debtor-affiliates filed for Chapter 11 protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq., at Kutak Rock LLP, is the Debtors' local counsel. The Debtors' claims & balloting agent is Kutzman Carson Consultants LLC. When the Debtors' filed for protection from their creditors, they listed total assets of $891,993,000 and total liabilities of $1,419,215,000. The Official Committee of Unsecured Creditors has selected Robert J. Feinstein, Esq., James I. Stang, Esq., Robert B. Orgel, Esq., and Brad Godshall, Esq., at Pachulski Stang Ziehl & Jones LLP, as its lead counsel, and Brian F. Kenney, Esq., at Miles & Stockbridge PC, as its local counsel. (Movie Gallery Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000) The Debtors' spokeswoman Meaghan Repko said that the Plan will not be filed before November 27, and the company does not expect to exit bankruptcy protection before the second quarter of 2008. MRS FIELDS: S&P Withdraws Ratings at Company's Request ------------------------------------------------------ Standard & Poor's Ratings Services withdrew its ratings on the Salt Lake City, Utah-based Mrs. Fields Famous Brands LLC, including the 'CCC+' corporate credit rating, at the company's request. MTI TECHNOLOGY: U.S. Trustee Appoints Nine-Member Creditors Panel ------------------------------------------------------------------ The U.S. Trustee for Region 16 appointed nine creditors to serve on an Official Committee of Unsecured Creditors of MTI Technology Corp.'s Chapter 11 case. The Creditors Committee members are: a) EMC Corp. Steven D. Saas, Esq. c/o RMS 307 International Circle, Suite 270 Hunt Valley, MD 21030 Tel: (410) 773-4040 Fax: (410) 773-4057 b) Pencom Systems Michael Green, Esq. 40 Fulton Street, 18th Floor New Yor, NY 10038 Tel: (212) 513-7777 Fax: (212) 513-1975 c) Wade Saadi Michael Green, Esq. 40 Fulton Street, 18th Floor New Yor, NY 10038 Tel: (212) 513-7777 Fax: (212) 513-1975 d) CCS Computer Configuration Services Al Grasso 2531 White Road Irvine, CA 92614 Tel: (949) 476-0874 Fax: (949) 261-9164 e) Compnology Inc. John S. Cronin 6300 Station Mill Drive Norcross, GA 30092 Tel: (678) 480-6266 Fax: (678) 935-0619 f) Lifeboat Distribution Inc. Kevin Scull 1157 Shrewsbury Avenue Shrewsbury, NJ 07702 Tel: (732) 389-8950 Fax: (732) 389-1207 g) Mid Atlantic Corporate Services Inc. Michael Buxton 812 Oregan Ave., Suite H Limphicum, MD 21090 Tel: (410) 636-7966 Fax: (410) 636-7466 h) FedEx Custom Critical c/o RMS 307 International Circle, Suite 270 Hunt Valley, MD 21030 Tel: (410) 773-4085 Fax: (410) 773-4057 i) Neoscale Systems Inc. c/o Andrew Moley or Janet Cahill 1655 McCarth Blvd. Milpitas, CA 95035 Tel: (408) 473-1334 Fax: (408) 473-1307 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About MTI Technology Headquartered in Tustin, California, M.T.I. Technology Corp. -- http://www.mti.com/-- provides professional services and data storage for mid- to large-sized organizations. In addition, the company owns all of the issued and outstanding share capital of three European subsidiaries: MTI Technology GmbH in Germany, MTI Technology Limited in Scotland and MTI France S.A.S. in France. The company filed for Chapter 11 protection on Oct. 15, 2007 (Bankr. C.D. Calif. Case No. 07-13347). Scott C. Clarkson, Esq., at Clarkson, Gore & Marsella, A.P.L., represents the Debtor. Omni Management Group LLC serve as the Debtor's claim, noticing and balloting agent. As of July 7, 2007, the Debtor had total assets of $64,002,000 and total debts of $58,840,000. MTI TECHNOLOGY: Committee Taps Winthrop as Insolvency Counsel ------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed for MTI Technology Corporation's bankruptcy case asks the United States Bankruptcy Court for the Central District of California for permission to employ Winthrop Couchot Professional Corporation as its general insolvency counsel. As the Committee's general insolvency counsel, Winthrop Couchot will: a) provide the Committee legal advice with respect to its duties, responsibilities and powers in the Debtor's bankruptcy case; b) assist the Committee in investigating the acts, conduct, assets, liabilities and financial condition of the Debtor and its insiders and affiliates; c) provide the Committee legal advice and representation with respect to the negotiation, confirmation and implementation of a Chapter 11 plan; d) provide the Committee legal advice with respect to the administration of the Debtor's case, the distribution of the Debtor's assets, the prosecution of claims against third parties, and any other matters relevant to the Debtor's case; e) provide the Committee legal advice and representation, if appropriate, with respect to the appointment of a trustee or examiner; and f) provide the Committee legal advice and representation in any legal proceeding, whether adversary or otherwise, involving the interest represented by the Committee, and the performance of other legal services as may be required by the Committee in furtherance of the interests of general unsecured creditors in the Debtor's case. The firm's professionals and their compensation rates are: Attorney Hourly Rate -------- ----------- Marc J. Winthrop, Esq. $565 Robert E. Opera, Esq. $550 Sean A. Okeefe, Esq. $550 Paul J. Couchot, Esq. $525 Richard H. Golubow, Esq. $395 Peter W. Lianides, Esq. $395 Garrick A. Hollander, Esq. $375 Legal Assistants Hourly Rate ---------------- ----------- P.J. Marksbury $190 Legal Assistant Associates $80-$150 Robert E. Opera, Esq., a shareholder of the firm, assures the Court that the firm does not hold any interest adverse to the Debtor's estate and is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Mr. Opera can be reached at: Robert E. Opera, Esq. Winthrop Couchot Professional Corporation 660 Newport Center Drive, 4th Floor Newprot Beach, CA 92660 Tel: (949) 720-4100 Fax: (949) 720-4111 About MTI Technology Headquartered in Tustin, California, M.T.I. Technology Corp. -- http://www.mti.com/-- provides professional services and data storage for mid- to large-sized organizations. In addition, the company owns all of the issued and outstanding share capital of three European subsidiaries: MTI Technology GmbH in Germany, MTI Technology Limited in Scotland and MTI France S.A.S. in France. The company filed for Chapter 11 protection on Oct. 15, 2007 (Bankr. C.D. Calif. Case No. 07-13347). Scott C. Clarkson, Esq., at Clarkson, Gore & Marsella, A.P.L., represents the Debtor. Omni Management Group LLC serve as the Debtor's claim, noticing and balloting agent. As of July 7, 2007, the Debtor had total assets of $64,002,000 and total debts of $58,840,000. NEPTUNE INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $2 Mil. ----------------------------------------------------------------- Neptune Industries Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $2,163,616 in total assets and $4,210,461 in total liabilities, resulting in a $2,046,844 total shareholders' deficit. The company reported a net loss of $403,813 on sales of $111,193 for the first quarter ended Sept. 30, 2007, compared with a net loss of $483,198 on sales of $255,877 in the same period ended Sept. 30, 2006. The decrease in sales is attributed to lack of harvestable inventory during the three months ended Sept. 30, 2007. Operating expenses decreased to $216,931 from $349,275 for the quarter ended Sept. 30, 2007. The fluctuation in operating expenses is primarily related to stock compensation in the prior year quarter. 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?25cd Going Concern Doubt As reported in the Troubled Company Reporter on Oct. 19, 2007, Berman Hopkins Wright & Laham, CPAs and Associates, LLP, expressed substantial doubt about Neptune Industries Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended June 30, 2007. The auditing firm pointed to the company's recurring losses from operations and recurring deficiencies in working capital. About Neptune Industries Headquartered in Boca Raton, Fla., Neptune Industries Inc. (OTC BB: NPDI.OB) -- http://www.neptuneindustries.net/-- is a public Florida corporation that engages in commercial fish farming and related production and distribution activities in the seafood and aquaculture industries. NETBANK INC: Intends to Liquidate Assets Under Chapter 11 --------------------------------------------------------- NetBank Inc. disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that it intends to file a Plan of Reorganization and related Disclosure Statement with the U.S. Bankruptcy Court for the Middle District of Florida which will describe the liquidation of assets. The Debtor believes that its equity securities have and will have no value and that any Chapter 11 plan approved by the Court will not provide stockholders with any distributions. Accordingly, the Debtor does not anticipate providing for any value or distribution to stockholders. Headquartered in Jacksonville, Florida, NetBank Inc. -- http://www.netbank.com/-- is a financial holding company of Netbank, the United States' oldest Internet bank serving retail and business customers in all 50 states. NetBank Inc. does retail banking, mortgage banking, business finance, and providing ATM and merchant processing services. The company filed for Chapter 11 protection on Sept. 28, 2007 (Bankr. M.D. Fla. Case No. 07-04295). Alan M. Weiss, Esq., at Holland & Knight LLP. In its schedules filed with the Court, the Debtor disclosed total assets of $5,746,867 and total debts of $35,213,265. Attorneys at Kilpatrick Stockton LLP and Rogers Towers P.A., represent the Official Committee of Unsecured Creditors. ORION 2006-2: Poor Credit Quality Cues Moody's Rating Downgrades ---------------------------------------------------------------- Moody's Investors Service downgraded ten classes of notes issued by Orion 2006-2, Ltd., with five of these classes left on review for further possible downgrade. The notes affected by the rating action are: Class Description: $900,000,000 Class A-1A Senior Secured Floating Rate Variable Funding Notes Due 2051 -- Prior Rating: Aaa -- Current Rating: Ba1, on review for possible downgrade Class Description: $40,000,000 Class A-1B Senior Secured Floating Rate Notes Due 2051 -- Prior Rating: Aaa -- Current Rating: Ba1, on review for possible downgrade Class Description: $195,000,000 Class A-2 Senior Secured Floating Rate Notes Due 2051 -- Prior Rating: Aaa -- Current Rating: B3, on review for possible downgrade In addition Moody's also announced that it has downgraded and left on review for possible downgrade these notes: Class Description: $87,500,000 Class B-1 Secured Floating Rate Notes Due 2051 -- Prior Rating: Aa2 -- Current Rating: Caa2, on review for possible downgrade Class Description: $40,000,000 Class B-2 Secured Floating Rate Notes Due 2051 -- Prior Rating: Aa3 -- Current Rating: Caa3, on review for possible downgrade Class Description: $58,000,000 Class C-1 Secured Deferrable Floating Rate Notes Due 2051 -- Prior Rating: A2 -- Current Rating: Ca Class Description: $51,000,000 Class D-1 Mezzanine Secured Deferrable Floating Rate Notes Due 2051 -- Prior Rating: Baa2 -- Current Rating: Ca Class Description: $13,000,000 Class D-2 Mezzanine Secured Deferrable Floating Rate Notes Due 2051 -- Prior Rating: Baa3 -- Current Rating: Ca Class Description: $10,500,000 Class E Subordinated Secured Deferrable Floating Rate Notes Due 2051 -- Prior Rating: Ba1 -- Current Rating: Ca Class Description: $25,000,000 Class X Subordinated Notes Due 2051 -- Prior Rating: Baa3 -- Current Rating: Ca The rating actions reflect severe deterioration in the credit quality of the underlying portfolio, as well as the occurrence on Nov. 6, 2007 of an event of default caused by a failure of the level of overcollateralization, as set forth in Secton 5.1(h) of the Indenture, dated Nov. 1, 2006 to meet the required level. Orion 2006-2, Ltd. is a hybrid collateralized debt obligation backed primarily by a portfolio of RMBS securities, CDO securities and synthetic securities in the form of credit default swaps. Reference obligations for the credit default swaps are RMBS and CDO securities. Recent ratings downgrades on the underlying portfolio caused ratings-based haircuts to affect the calculation of overcollateralization. Thus, the required level of overcollateralization was not achieved. The rating downgrades taken today reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The expected losses of certain tranches may be different, however, depending on the timing and choice of remedy to be pursued by the controlling class. Because of this uncertainty, the ratings of Class A-1A, Class A-1 B, Class A-2, Class B-1, Class B-2, Class C- 1, Class D-2, Class E and Class X Notes remain on review for possible downgrade pending the receipt of definitive information. ORLANDO CITYPLACE: Wants Additional Time to Sell Lexington Hotel ---------------------------------------------------------------- Orlando CityPlace LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Middle District of Florida to delay the sale of its property, The Lexington Hotel, Jerry W. Jackson writes for the Orlando Sentinel. As reported in the Troubled Company Reporter on Sept. 27, 2007, the Debtors intended to sell their property at an auction set today, Nov. 29, 2007, after the Court approved their proposed asset sale procedure. According to R. Scott Shuker, Esq., Debtors' counsel, additional time is required for the highest bidders to complete their due diligence report and for other interested parties to make bids, Sentinel relates. The Debtors, previously wanting to sell the hotel for $30 million, are now settling for "firm" bids after no purchaser made a bid of that much amount, Sentinel says. About Orlando CityPlace Based in Orlando, Florida, Orlando CityPlace LLC and its affiliates -- http://www.lexingtonorlando.com/-- develop real estate property. The Debtors own the Lexington Hotel and District Five Restaurant on Orlando. The company and its affiliates filed for Chapter 11 protection on July 23, 2007 (Bankr. M.D. Fla. Lead Case No. 07-03159). Jimmy D. Parrish, Esq., Mariane L. Dorris, Esq., and R. Scott Shuker, Esq., at Latham, Shuker, Eden & Beaudine, LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, Orlando CityPlace, LLC listed total assets of $55,000,000, and total debts of $44,000,000, while O.C.P. Corner, LLC listed total assets of $2,000,000 and total debts of $1,700,000. Orlando CityPlace II, LLC listed total assets and debts of $1 million to $100 million. PACER HEALTH: Sept. 30 Balance Sheet Upside-Down by $6.8 Million ---------------------------------------------------------------- Pacer Health Corp.'s consolidated balance sheet at Sept. 30, 2007, showed $17.1 million in total assets, $15.3 million in total liabilities, and $8.6 million, resulting in a $6.8 million total stockholders' deficit. The company reported a net loss of $1.9 million on total revenues of $8.7 million for the third quarter ended Sept. 30, 2007, compared to net income of $2.8 million on total revenues of $3.2 million in the same period of 2006. The increase in revenue was primarily due to the acquisition of Knox County Hospital. The decrease in net income is primarily the result of the disposal of Southpark, which generated net income from discontinued operations of $3.9 million in the three months ended Sept. 30, 2006, that included a gain on disposal of $4.4 million. During the three months ended Sept. 30, 2006, Southpark had a net loss of $544,514, which was included in discontinued operations. For the nine months ended Sept. 30, 2007, the company had revenues of $30.4 million, an increase from the revenues of $11.0 million reported in the same period last year. Net loss for the nine months ended Sept. 30, 2007, decreased to $2.1 million, versus a net loss of $2.5 million reported in the corresponding period in 2006. 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?25ce Liquidity The company had cash of $97,280 at Sept. 30, 2007. Net cash used in operating activities during the nine month period ended Sept. 30, 2007 was $3.1 million, compared to $4.0 million for the same period a year earlier. Net cash used in investing activities was $167,555 for the nine months ended Sept. 30, 2007, compared to net cash provided of $2.3 million for the same period in 2006. Net cash provided by financing activities was $3.3 million for the nine months ended Sept. 30, 2007, compared to $1.4 million in the same period for 2006. Net cash provided in financing activities during the nine months ended Sept. 30, 2007, consisted of proceeds from the sale of the minority interest of $1.2 million, net proceeds from a new convertible debentures of $3.6 million, a redemption of convertible debentures of $1.2 million, repayments of $453,314 for notes payable, distributions to minority interest holders of $37,000 and a cash overdraft of $143,598. About Pacer Health Corporation Headquartered in Miami, Florida, Pacer Health Corporation (OTC BB: PHLH) -- http://www.pacerhealth.com/-- is an owner-operator of acute care hospitals, medical treatment centers and psychiatric care facilities serving non-urban areas throughout the Southeast. PACIFICNET INC: Posts $220,000 Net Loss in Qtr. Ended Sept. 30 -------------------------------------------------------------- PacificNet Inc. reported unaudited results for the third quarter ended Sept. 30, 2007. Net loss third quarter of $220,000, a quarter-over-quarter increase of 80% as compared to a loss of $1,115,000 for the same quarter of 2006. Quarterly net loss is due to the loss on the disposal of certain discontinued telecom operations held for disposition $356,000. Those disposals are non-cash, non-recurring and one-time charges, attributed to Guangzhou 3G and Linkhead, which were both part of the company's telecom group. Cash and cash equivalents increased to $4,889,000 on Sept. 30, 2007, compared to $1,900,000 as of Dec. 31, 2006, as a result of improved operating profits and net proceeds from the issuance of a $5 million convertible debenture for the company's gaming technology business. Net loss for the first nine months of this year was $639,000, as compared to net income of $604,000 for the same period of prior year. Net Loss is due to the loss on disposal of discontinued operations of $925,000, which is a one-time, non-cash charge caused by the disposal of our telecom assets related to Guangzhou 3G and Linkhead. The loss is also the result of higher accounting expenses due to the re-audit process. At Sept. 30, 2007, the company's balance sheet showed total assets of $42.96 million, total liabilities of $27.99 million and total shareholders' equity of $14.97 million. About PacificNet Inc. Headquartered in Beijing, China, PacificNet Inc. (NasdaqGM: PACT) -- http://www.PacificNet.com/-- is a provider of gaming technology, e-commerce, and Customer Relationship Management in China. PacificNet's gaming products are designed for Chinese and Asian gamers with focus on integrating localized Chinese and Asian themes and content, advanced graphics, digital sound effects and popular domestic music, with secondary bonus games and jackpots. PacificNet's gaming clients include the leading hotels, casinos, and gaming operators in Macau, Asia, and Europe, while ecommerce and CRM clients include the leading telecom companies, banks, insurance, travel, marketing and business services companies and telecom consumers in Greater China such as China Telecom, China Mobile, Unicom, PCCW, Hutchison Telecom, Bell24, Motorola, Nokia, SONY, TCL, Huawei, American Express, Citibank, HSBC, Bank of China, Bank of East Asia, DBS, TNT, China and Hong Kong government. PacificNet employs about 1,200 staff in its various subsidiaries throughout China with offices in Hong Kong, Beijing, Shanghai, Shenzhen, Guangzhou, Macau and Zhuhai China, USA, and the Philippines. Going Concern Doubt Kabani & Company Inc. in Los Angeles, expressed substantial doubt about PacificNet Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended Dec. 31, 2006. The auditing firm reported that during the year ended Dec. 31, 2006, the company incurred net losses of $20.1 million. In addition, thecCompany had a negative cash flow in operating activities amounting to $8.9 million in the year ended Dec. 31, 2006, and the company's accumulated deficit was $47.7 million as of Dec. 31, 2006. The auditing firm also reported that the company is in default on its convertible debenture obligation. In July 2007, the company failed to timely make scheduled principal payments under an Amended and Restated Variable Rate Convertible Debenture due March 2009 in the aggregate amount of $8 million. Pursuant to the terms of the Amended Debenture, the company was obligated to make monthly redemption payments commencing on Jan. 1, 2007, until the Amended Debenture was redeemed in full. On Aug. 1, 2007, the company made the July monthly redemption and interest payments to all of the debenture holders. PARK PLACE: Fitch Puts 'BB' Ratings on Three Cert. Classes ---------------------------------------------------------- Fitch Ratings has taken rating actions on Park Place Securities, Inc. mortgage pass-through certificates. Affirmations total $1.7 billion and downgrades total $294.0 million. In addition, $14.7 million is placed on Rating Watch Negative. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: 2005-WCH1: -- $159.2 million class A affirmed at 'AAA' (BL:85.25, LCR:5.56); -- $21.8 million class M-1 affirmed at 'AA+' (BL:74.95, LCR:4.89); -- $88.3 million class M-2 affirmed at 'AA+' (BL:58.00, LCR:3.78); -- $32.3 million class M-3 affirmed at 'AA' (BL:52.08, LCR:3.40); -- $42.7 million class M-4 affirmed at 'AA-' (BL:43.96, LCR:2.87); -- $31.3 million class M-5 affirmed at 'A+' (BL:35.75, LCR:2.33); -- $23.7 million class M-6 affirmed at 'A' (BL:23.78, LCR:1.55); -- $25.6 million class M-7 downgraded to 'BBB+' from 'A-' (BL:20.79, LCR:1.36); -- $18.0 million class M-8 downgraded to 'BBB' from 'BBB+' (BL:19.01, LCR:1.24); -- $19.9 million class M-9 downgraded to 'BBB-' from 'BBB' (BL:17.06, LCR:1.11); -- $30.4 million class M-10 downgraded to 'BB' from 'BB+' (BL:14.67, LCR:0.96). Deal Summary -- Originators: Argent Mortgage Company and Olympus Mortgage Company; -- 60+ day Delinquency: 23.81%; -- Realized Losses to date (% of Original Balance): 2.53%; -- Expected Remaining Losses (% of Current Balance): 15.33%; -- Cumulative Expected Losses (% of Original Balance): 6.87%. 2005-WHQ1: -- $216.6 million class A affirmed at 'AAA' (BL:76.03, LCR:4.71); -- $30.0 million class M-1 affirmed at 'AA+' (BL:70.55, LCR:4.37); -- $94.0 million class M-2 affirmed at 'AA' (BL:54.99, LCR:3.41); -- $32.0 million class M-3 affirmed at 'AA' (BL:50.10, LCR:3.11); -- $42.0 million class M-4 affirmed at 'A+' (BL:43.42, LCR:2.69); -- $34.0 million class M-5 affirmed at 'A' (BL:37.93, LCR:2.35); -- $22.0 million class M-6 affirmed at 'A' (BL:34.32, LCR:2.13); -- $31.0 million class M-7 affirmed at 'BBB+' (BL:27.03, LCR:1.68); -- $16.0 million class M-8 affirmed at 'BBB+' (BL:21.33, LCR:1.32); -- $25.0 million class M-9 downgraded to 'BBB-' from 'BBB' (BL:18.40, LCR:1.14); -- $27.0 million class M-10 downgraded to 'BB' from 'BB+' (BL:15.75, LCR:0.98); -- $23.0 million class M-11 downgraded to 'B' from 'BB' (BL:14.07, LCR:0.87). Deal Summary -- Originators: Argent Mortgage Company and Olympus Mortgage Company; -- 60+ day Delinquency: 25.37%; -- Realized Losses to date (% of Original Balance): 2.28%; -- Expected Remaining Losses (% of Current Balance): 16.13%; -- Cumulative Expected Losses (% of Original Balance): 7.38%. 2005-WHQ3: -- $312.2 million class A affirmed at 'AAA' (BL:66.38, LCR:4.88); -- $59.0 million class M-1 affirmed at 'AA+' (BL:57.23, LCR:4.21); -- $69.0 million class M-2 affirmed at 'AA+' (BL:46.93, LCR:3.45); -- $37.0 million class M-3 affirmed at 'AA+' (BL:42.02, LCR:3.09); -- $33.0 million class M-4 affirmed at 'AA' (BL:37.40, LCR:2.75); -- $32.0 million class M-5 affirmed at 'AA-' (BL:32.88, LCR:2.42); -- $29.0 million class M-6 affirmed at 'A+' (BL:24.87, LCR:1.83); -- $28.0 million class M-7 downgraded to 'A-' from 'A' (BL:20.27, LCR:1.49); -- $21.0 million class M-8 downgraded to 'BBB+' from 'A-' (BL:17.93, LCR:1.32); -- $18.0 million class M-9 downgraded to 'BBB' from 'BBB+' (BL:16.22, LCR:1.19); -- $16.0 million class M-10 downgraded to 'BBB-' from 'BBB' (BL:14.78, LCR:1.09); -- $26.0 million class M-11 downgraded to 'BB' from 'BBB-' (BL:12.08, LCR:0.89); -- $16.0 million class M-12 downgraded to 'B' from 'BB+' (BL:11.22, LCR:0.83); Deal Summary -- Originators: Argent Mortgage Company and Olympus Mortgage Company; -- 60+ day Delinquency: 23.84%; -- Realized Losses to date (% of Original Balance): 1.62%; -- Expected Remaining Losses (% of Current Balance): 13.59%; -- Cumulative Expected Losses (% of Original Balance): 6.51%. 2005-WLL1: -- $74.5 million class A affirmed at 'AAA' (BL:77.39, LCR:6.06); -- $29.0 million class M-1 affirmed at 'AA+' (BL:65.46, LCR:5.12); -- $26.5 million class M-2 affirmed at 'AA' (BL:54.19, LCR:4.24); -- $16.4 million class M-3 affirmed at 'AA-' (BL:47.51, LCR:3.72); -- $14.3 million class M-4 affirmed at 'A+' (BL:41.56, LCR:3.25); -- $13.4 million class M-5 affirmed at 'A' (BL:35.96, LCR:2.81); -- $13.0 million class M-6 affirmed at 'A-' (BL:28.19, LCR:2.21); -- $10.9 million class M-7 affirmed at 'BBB+' (BL:18.83, LCR:1.47); -- $10.5 million class M-8 affirmed at 'BBB' (BL:16.53, LCR:1.29); -- $5.8 million class M-9 affirmed at 'BBB-' (BL:15.24, LCR:1.19); -- $6.3 million class M-10 rated 'BB+', placed on Rating Watch Negative (BL:13.74, LCR:1.08); -- $8.4 million class M-11 rated 'BB', placed on Rating Watch Negative (BL:12.39, LCR:0.97). Deal Summary -- Originators: Argent Mortgage Company and Olympus Mortgage Company; -- 60+ day Delinquency: 21.83%; -- Realized Losses to date (% of Original Balance): 1.83%; -- Expected Remaining Losses (% of Current Balance): 12.78%; -- Cumulative Expected Losses (% of Original Balance): 5.54%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2006 and late 2005 with regard to continued poor loan performance and home price weakness. PARK PLACE: Fitch Cuts Rating on Three Class Certificates -------------------------------------------------------- Fitch has taken rating actions on these three Park Place subprime issues: 2004-MHQ1 -- Class A affirmed at 'AAA'; -- Class M-1 affirmed at 'AA+'; -- Class M-2 affirmed at 'AA'; -- Class M-3 affirmed at 'AA-'; -- Class M-4 affirmed at 'A+'; -- Class M-5 affirmed at 'A'; -- Class M-6 affirmed at 'A-'; -- Class M-7 affirmed at 'BBB+'; -- Class M-8 rated 'BBB,' placed on Rating Watch Negative; -- Class M-9 rated 'BBB-,' remains on Rating Watch Negative; -- Class M-10 downgraded to 'B' from 'BB+'; removed from Rating Watch Negative. 2004-WHQ1 -- Class A affirmed at 'AAA'; -- Class M-1 affirmed at 'AA+'; -- Class M-2 affirmed at 'AA'; -- Class M-3 affirmed at 'AA-'; -- Class M-4 affirmed at 'A+'; -- Class M-5 affirmed at 'A'; -- Class M-6 affirmed at 'A-'; -- Class M-7 affirmed at 'BBB+'; -- Class M-8 affirmed at 'BBB'; -- Class M-9 downgraded to 'BB+' from 'BBB-'; -- Class M-10 downgraded to 'BB' from 'BB+'; removed from Rating Watch Negative. 2004-WHQ2 -- Class A affirmed at 'AAA'; -- Class M-1 affirmed at 'AA+'; -- Class M-2 affirmed at 'AA'; -- Class M-3 affirmed at 'AA-'; -- Class M-4 affirmed at 'A+'; -- Class M-5 affirmed at 'A'; -- Class M-6 affirmed at 'A-'; -- Class M-7 affirmed at 'BBB+'; -- Class M-8 rated 'BBB,' placed on Rating Watch Negative; -- Class M-9 rated 'BBB,' placed on Rating Watch Negative; -- Class M-10 rated 'BB+,' remains on Rating Watch Negative; The affirmations, affecting approximately $1.7 billion of the outstanding balances, are taken due to a satisfactory relationship of credit enhancement to expected losses. In series 2004-MHQ1, classes M-8 and M-9 are placed on Rating Watch Negative and M-10 is downgraded due to monthly losses exceeding excess spread, which has caused deterioration in the overcollateralization amount. As of the October 2007 distribution, the OC amount of $54.4 million is below the target amount of $85.4 million. Monthly losses have exceeded excess spread by an average of $2.17 million over the last twelve months. As of the cut-off date, the pool factor (percentage of loans remaining) for series 2004-MHQ1 is 24% and 21.3% of the remaining balance is more than sixty days delinquent. The deal is currently seasoned 36 months. In series 2004-WHQ1 classes M-9 and M-10 are downgraded due to monthly losses exceeding excess spread, which has caused deterioration in the OC amount. Due to the deal stepping down this month, excess spread is currently above its target of $26.8 million. However, in the six months prior to the step-down, OC was an average of $9 million (13%) below target. As of the cut- off date, the pool factor for series 2004-WHQ1 is 21% and 24.3% of the remaining balance is more than sixty days delinquent. The deal is currently seasoned 37 months. In series 2004-WHQ2 classes M-8, M-9, and M-10 are placed on Rating Watch Negative due to monthly losses exceeding excess spread which has caused deterioration in the OC amount. However, once the deal steps-down, Fitch expects the deal to be able to meet its target. Fitch expects the deal to step down in two months. As of the cut-off date, the pool factor for series 2004- WHQ2 is 26% and 23.1% of the remaining balance is more than sixty days delinquent. The deal is currently seasoned 35 months. The collateral in the aforementioned transaction consists of fixed- and adjustable-rate, closed-end, first lien subprime mortgage loans. The majority of the loans were originated or acquired by Ameriquest Mortgage Company, Argent Mortgage Company, LLC, and Olympus Mortgage Company. All of the mortgage loans are serviced by HomEQ Servicing Corp, which is rated 'RPS1' by Fitch. PHARMED GROUP: Hires Berger Singerman as Bankruptcy Counsel -------------------------------------------------------- Pharmed Group Holdings Inc. and its debtor-affiliates obtained permission from the United States Bankruptcy Court for the Southern District of Florida to employ Berger Singerman P.A., as their counsel, nunc pro tunc to Oct. 26, 2007. Berger Singerman is expected to: a. give advice to the Debtors with respect to their power and duties as debtor-in-possession and the continued management of their business operations; b. advice the Debtors with respect to their responsibilities in complying with the U.S. Trustee's operating guidelines and reporting requirements and with the rules of the Court; c. prepare motions, pleadings, orders, applications, adversary proceedings, and other legal documents necessary in the administration of these cases; d. protect the interest of the Debtors in all matters pending before the Court; and e. represent the Debtors in negotiations with their creditors and in the preparation of a plan. As reported in the Troubled Company Reporter on Nov. 2, 2007, the Debtors told the Court that on Oct. 11, 2007, the firm received $20,000 for payments of the outstanding balance prepetition fees and expenses. Paul Steven Singerman, Esq., a shareholder of firm, will charge $475 per hour for this engagement, while Brian Rich, Esq., also a shareholder of the firm, bills $370 per hour. The firm's other professionals compensation rates are: Designations Hourly Rate ------------ ----------- Attorneys $250 - $475 Associates $250 - $370 Legal Assistants $75 - $160 Paralegals $75 - $160 Mr. Singerman assured the Court that the firm does not hold any interest adverse to the Debtors' estate and is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Miami, Florida, Pharmed Group Holdings Inc. -- http://www.pharmed.com/-- and its affiliates sends drugs and medical supplies on Caribbean cruises. They distribute medical, rehabilitative, and surgical supplies throughout the southeastern U.S., as well as Caribbean, and Central and South American countries. They deliver products made by Dynatronics, Welch Allyn, and Smith & Nephew. In addition to their distribution businesses, they make and distribute vitamins, minerals, nutraceuticals, and dietary supplements. The company and four debtor-affiliates filed for chapter 11 protection on Oct. 26, 2007 (Bankr. S.D. Fla. Case Nos. 07-19187 through 07-19191). When the Debtors filed for bankruptcy, they listed assets between $1 million and $100 million and debts of more than $100 million. PHARMED GROUP: Hires Trumbull Group as Claims and Noticing Agent ---------------------------------------------------------------- Pharmed Group Holdings Inc. and its debtor-affiliates sought and obtained authority from the United States Bankruptcy Court for the Southern District of Florida to employ Trumbull Group LLC dba Wells Fargo Trumbull as its claims, noticing and balloting agent. Trumbull Group is expected to: a) prepare and serve required notices in these Chapter 11 cases, including: i. notice of commencement of these Chapter 11 cases and the initial meeting of creditors under section 341(a) of the Bankruptcy Code; ii. notice of any auction sale hearing; iii. notice of the claims bar date; iv. notice of objection to claims; v. notice of any hearings on a disclosure statement and confirmation of a plan of reorganization; and vi. other miscellaneous notices to any entities, as the Debtors or the Court may deem necessary or appropriate for an orderly administration of these Chapter 11 cases; b) after the mailing of a particular notice, file with the Clerk's office a certificate or affidavit of service that includes a copy of the notice involved, a list of persons to whom the notice was mailed and the date and manner of mailing; c) maintain copies of all proofs of claim and proofs of interest filed; d) maintain official claims registers, including, among other things, these information for each proof of claim or proof of interest: i. the name and address of the claimant and any agent thereof, if the proof of claim or proof of interest was filed by an agent; ii. the date the proof of claim or proof of interest was received by Trumbull or the Court; iii. the claim number assigned; and iv. the asserted amount and classification of the claim; e) implement necessary security measures to ensure the completeness and integrity of the claims registers; f) transmit to the Clerk's office a copy of the claims registers on a monthly basis, unless requested by the Clerk's office on a more or less frequent basis; or, in the alternative, make available the claims register on-line; g) maintain an up-to-date mailing list for all entities that have filed a proof of claim, or proof of interest, or notice of appearance, which list shall be available upon request of a party in interest or the Clerk's office; h) provide access to the public for examination of copies of the proofs of claim or interest without charge during regular business hours; i) record all transfers of claims pursuant to Bankruptcy Rule 3001(e) and provide notice of such transfers as required by Bankruptcy Rule 3001(e); j) comply with applicable federal, state, municipal, and local statutes, ordinances, rules, regulations, orders and other requirements; j) provide temporary employees to process claims, if necessary; l) provide balloting services in connection with the solicitation process for any Chapter 11 plan for which a disclosure statement has been approved by the Court; m) provide such other claims processing, noticing and related administrative services as may be requested from time to time by the Debtors; and n) promptly comply with such further conditions and requirements as the Court may at any time prescribe. In addition, the Debtors sought and obtained permission from the Court to employ Trumbull to assist, among other things: a) the reconciliation and resolution of claims; and b) the preparation, mailing and tabulation of ballots for the purpose of voting to accept or reject any plans of reorganization proposed by the Debtors in these cases. Document filed with the Court did not disclose the Firm's compensation rates. Jessica L. Wasserstrom, a vice president and senior consultant of the firm, assured the Court that the firm does not hold any interest adverse the Debtors' estate and is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Miami, Florida, Pharmed Group Holdings Inc. -- http://www.pharmed.com/-- and its affiliates sends drugs and medical supplies on Caribbean cruises. They distribute medical, rehabilitative, and surgical supplies throughout the southeastern U.S., as well as Caribbean, and Central and South American countries. They deliver products made by Dynatronics, Welch Allyn, and Smith & Nephew. In addition to their distribution businesses, they make and distribute vitamins, minerals, nutraceuticals, and dietary supplements. The company and four debtor-affiliates filed for chapter 11 protection on Oct. 26, 2007 (Bankr. S.D. Fla. Case Nos. 07-19187 through 07-19191). Paul Steven Singerman, Esq., at Berger Singerman PA represents the Debtors in their restructuring efforts. When the Debtors filed for bankruptcy, they listed assets between $1 million and $100 million and debts of more than $100 million. POINTE LLC: Case Summary & Five Largest Unsecured Creditors ----------------------------------------------------------- Debtor: The Pointe, L.L.C. 136 North Battlefield Boulevard Chesapeake, VA 23320 Bankruptcy Case No.: 07-72790 Chapter 11 Petition Date: November 27, 2007 Court: Eastern District of Virginia (Norfolk) Debtor's Counsel: Joseph T. Liberatore, Esq. Marcus, Santoro & Kozak, P. C. 1435 Crossways Boulevard, Suite 300 Chesapeake, VA 23320 Tel: (757) 222-2224 Fax: (757) 333-3390 Estimated Assets: $2,454,500 Estimated Debts: $2,083,879 Debtor's Five Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Marker One, L.L.C. Advanced Payment $400,000 136 North Battlefield of Real Estate Boulevard Taxes and Lease Chesapeake, VA 23320 City of Chesapeake Real Estate Taxes $5,000 Barbara O. Carraway, Treasurer P.O. Box 1606 Chesapeake, VA 23327-1606 Goodman & Co. Accounting Unknown 272 Bendix Road Services and Tax Virginia Beach, VA 23452 Return Preparation I.R.S. Unknown Virginia Department of Unknown Taxation PRIMITIVO IGLESIAS: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------------- Debtors: Primitivo Iglesias Barbara Ann Iglesias 7 Beaver Drive Locust Valley, NY 11560 Bankruptcy Case No.: 07-74849 Chapter 11 Petition Date: November 27, 2007 Court: Eastern District of New York (Central Islip) Debtors' Counsel: Michael G. McAuliffe, Esq. Law Office of Michael G. McAuliffe 48 South Service Road Melville, NY 11747 Tel: (631) 465-0044 Total Assets: $2,399,643 Total Debts: $2,095,861 Debtors' list of its 18 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Bank of America $119,737 P.O. Box 15026 Wilmington, DE 19850-5726 Internal Revenue Service $107,721 Holtsville, NY 11742 Chase Bank, USA N.A. $60,796 c/o Mann Bracken, LLC 2727 Paces Ferry Road 1 West Paces 14th Floor Atlanta, GA 30339 HSBC Card Services $54,590 Bank of America $39,107 Barclays Bank Delaware $20,013 Bank of America $16,779 Discover Bank $16,721 American Express $16,707 New York State Department of Tax & Finance $14,710 Expo Credit Services $14,430 Sony Financial Services $12,788 Domain Inc. $11,155 Fortunoff $5,757 Design Within Reach $3,621 Petro $2,391 PC Richard & Son/GE Money Bank $2,386 Saab Financial Services $2,168 QUEBECOR WORLD: Dividend Payment Suspension Cues S&P to Cut Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its preferred stock rating on Montreal-based printing company Quebecor World Inc. two notches to 'C' from 'CCC-'. The company's other ratings, including the 'B-' long-term corporate credit rating, remain unchanged. All ratings are on CreditWatch with negative implications, where they were initially placed Aug. 9, 2007. "The downgrade follows Quebecor World's announcement that it will be suspending dividend payments on its series 3 and series 5 preferred shares," said Standard & Poor's credit analyst Lori Harris. The company may be prevented from making the dividend payments because it might not satisfy the capital adequacy test within the Canada Business Corporations Act. Quebecor World will request shareholder approval at its next shareholder meeting in May 2008 to reduce the stated capital as permitted under the CBCA, which would involve reclassifying equity to allow dividend payments to resume, including accrued unpaid dividends. The next dividend payment is due Dec. 1, 2007. Should the company not make the declared dividend payment on that date as Quebecor World has stated, S&P will lower the preferred stock rating to 'D'. REFCO INC: RJM Wants Settlement Pact with FXCM Parties Approved --------------------------------------------------------------- RJM, LLC, as plan administrator to Reorganized Refco Inc. and its affiliates, and Marc S. Kirschner, as plan administrator to Refco Capital Markets, Ltd., ask the U.S. Bankruptcy Court for the Southern District of New York to approve their settlement agreement with Forex Capital Markets, LLC, Forex Trading LLC, FXCM Canada Ltd., FXCM LLC, David Sakhai, William Ahdout, Kenneth Grossman, Michael Romersa, and Edward Yusupov. Refco Group Ltd., a Reorganized Debtor, holds a 35% equity interest in Forex Capital Markets, LLC. Pursuant to the Plan, RJM has authority to exercise all rights of the Debtors in respect of RGL's 35% interest in FXCM, including all rights related to its liquidation or disposition. Certain entities have agreed to purchase RGL's 35% equity interest in FXCM. The names of the entities are withheld for confidentiality purposes, according to Steven Wilamowsky, Esq., at Bingham McCutchen LLP, in New York. The sale of RGL's interest is subject to the requirement that certain claims against the Debtors and RCM be resolved. The parties' Settlement Agreement provides that: a. The Plan Administrators will seek Court approval allowing the claims filed by the FXCM Parties: 1. Claim No. 9140, to be allowed as a Class 6 FXA Convenience Class Claim for $3,290.87; 2. Claim No. 9870, to be allowed as a Class 5(a) FXA General Unsecured Claim for $8,281,529.63; 3. Claim No. 9871, to be allowed as a Contributing Debtor Class 5(a) General Unsecured Claim for $8,281,529.63. b. The Plan Administrators ask Court to expunge FXCM Parties' 31 other claims -- Claim Nos. 6629, 6630, 6631, 6632, 6633, 6634, 6635, 6636, 6637, 7564, 7566, 7568, 7569, 7570, 7571, 7572, 14268, 14269, 14270, 14271, 14272, 14273, 14274, 14275, 14276, 14427, 14428, 14429, 14430, 14431, 14432. Jeffrey M. Olinsky, Esq., at Bingham McCutchen LLP, in New York, New York, says the Plan Administrators have carefully reviewed the claims filed by the FXCM Parties, as well as the books and records of the Reorganized Debtors and RCM as they relate to the claims. The Plan Administrators believe that Claim Nos. 9140, 9870 and 9871 are properly allowable at the amounts set, and the rest of the FXCM Parties' claims should be expunged. Mr. Olinsky says the FXCM Parties agree that the 31 other claims should be expunged. "Expunging these other claims will eliminate 31 claims against the Reorganized Debtors' and RCM's estates that seek damages based on alleged fraudulent conduct of the Debtors." Mr. Olinsky tells the Court the Agreement will result in proceeds from the sale of RGL's 35% equity interest in FXCM becoming available for distribution to creditors of the Contributing Debtors. A full-text copy of the FXCM Settlement Agreement is available for free at http://bankrupt.com/misc/FXCMsettlementAgreement.pdf About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its direct and indirect subsidiaries, including Refco Capital Markets Ltd. and Refco F/X Associates LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. Refco Commodity's exclusive period to file a chapter 11 plan expired on Feb. 13, 2007. (Refco Bankruptcy News, Issue No. 73 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000). REFCO INC: Judge Drain Approves Settlement Agreement with SPhinX ---------------------------------------------------------------- The Hon. Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York approved a settlement and release agreement entered into by: -- Refco Inc., and its debtor and non-debtor affiliates; Marc S. Kirschner, as the plan administrator for Refco Capital Markets, Ltd.; and RJM, LLC, as plan administrator for the Reorganized Debtors except RCM; and -- SPhinX Managed Futures Fund SPC, its affiliated Segregated Portfolios and various affiliated entities; Kenneth M. Krys and Christopher Stride, in their capacity as the Joint Official Liquidators of SPhinX; the SPhinX Trustee; and certain SPhinX investors. Judge Drain directed the RCM Administrator to distribute the Settlement Funds to RCM's creditors.. Judge Drain also withdrew the Restraining Order, and waived Rule 6004(h) of the Federal Rules of Bankruptcy Procedure to the extent applicable. SphinX Settlement Agreement Jessica L. Fink, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, related that in 2005, the Official Committee of Unsecured Creditors of the Debtors, on behalf of RCM, sought to recover $312,046,266 in preferential transfers to SPhinX and its affiliated Segregated Portfolios. To settle the dispute with the Committee, SPhinX had agreed to pay $263,000,000 to RCM's estate, which the SPhinX Investors opposed. The Bankruptcy Court had approved the SPhinX Settlement over the objection, ruling that it was in the best interests of RCM, its estate, and its creditors, and that the Investors lacked standing to object. The Investors had appealed to the District Court for the Southern District of New York, but the District Court affirmed the Bankruptcy Court's ruling. Ms. Fink notes that in June 2006, SPhinX went into voluntary liquidation under the court of the Cayman Islands, and Mr. Krys and Mr. Stride were appointed as its Joint Official Liquidators. The Investors, as well as the SPhinX Liquidators, appealed the District Court Order to the United States Court of Appeals for the Second Circuit. The Second Circuit recently affirmed the District Court's decision, Ms. Fink related. The Second Circuit held that the Investors lacked standing to appeal, and that the Liquidators were precluded from appealing because they were deemed to be parties to SPhinX. According to Ms. Fink, the Settlement Funds are currently being held by the RCM Plan Administrator in a segregated account at RCM, pending the entry a final order approving the SPhinX Settlement. Ms. Fink added that the Settlement and Release Agreement has been discussed with and approved by customers holding approximately 50% of the allowed RCM securities customer claims. The parties have agreed that: (a) the RCM Plan Administrator and the SPhinX Liquidators will take all steps necessary to seek approval of the Agreement by the Cayman Court and the Bankruptcy Court, respectively; (b) upon approval of the Agreement, the RCM Plan Administrator is authorized to release and distribute the Settlement Funds; (c) the RCM Plan Administrator will pay to the Liquidators, on behalf of SPhinX, a $2,500,000 appeal settlement payment; (d) the Liquidators, the SPhinX Investors, and the SPhinX Trustee will not file further appeals, or any motions for reconsideration, of the Settlement Approval Order; (e) the Liquidators will withdraw their motion for rehearing, currently pending before the Second Circuit; (f) Claim Nos. 11387 and 11378, filed by SPhinX against RCM will be allowed as general unsecured claims for $4,312,945 and $10,352,310, respectively, in RCM's Chapter 11 case; (g) all other claims filed by the parties are deemed disallowed and expunged; and (h) the parties exchange mutual releases from all claims or actions arising from the preferential transfers or the appeal of the SPhinX Settlement. Ms. Fink stated that the Settlement Funds will be distributed to RCM securities customers, pursuant to the Modified Joint Chapter 11 Plan of Refco Inc. and Certain of its Direct and Indirect Subsidiaries. The Appeal Settlement Payment will be deducted solely from the Settlement Funds, and will not impact recoveries to non-securities customers. Ms. Fink maintained that the terms embodied in the Agreement represents a reasonable settlement of the issues between the parties, and should be approved. A full-text copy of the Settlement and Release Agreement between Refco and SPhinX is available at no charge at: http://bankrupt.com/misc/RefcoSphinxSettlementRelease.pdf About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its direct and indirect subsidiaries, including Refco Capital Markets Ltd. and Refco F/X Associates LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. Refco Commodity's exclusive period to file a chapter 11 plan expired on Feb. 13, 2007. (Refco Bankruptcy News, Issue No. 73 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000). REFCO INC: RCM Distributes $279.5 Million from SPhinX Proceeds -------------------------------------------------------------- Pursuant to a settlement agreement by Refco Capital Markets, Ltd., all holders of Allowed Class 4 RCM Securities Customer Claims are entitled to receive their pro rata portion of the proceeds from the settlement with the SPhinX entities, which has become available for distribution. In this connection, Marc S. Kirschner, Plan Administrator for the Refco Capital Markets, Ltd. estate, notified the U.S. Bankruptcy Court for the Southern District of New York that on Nov. 16, 2007, he made the sixth interim distribution of approximately $279,500,000 of RCM's Assets in Place, resulting from the Net Sphinx Proceeds. Each claimant is entitled to its pro rata share of the Proceeds. The RCM Administrator notes that two creditors will be capped at 100% recovery from the Distribution. To date, the RCM Administrator has made five interim distributions from Assets in Place, aggregating to recoveries of $1,890,000,000, and another two interim distributions from Additional Property, resulting in recoveries of $344,700,000. A list of the claims for the Sixth Interim Distribution is available at no charge at: http://bankrupt.com/misc/Refco6thInterimDistClaims.pdf About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its direct and indirect subsidiaries, including Refco Capital Markets Ltd. and Refco F/X Associates LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. Refco Commodity's exclusive period to file a chapter 11 plan expired on Feb. 13, 2007. (Refco Bankruptcy News, Issue No. 73 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000). RESIDENTIAL ACCREDIT: S&P Retains 'B' Rating Under Neg. Watch ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class M-2 and M-3 mortgage asset-backed pass-through certificates from Residential Accredit Loans Inc.'s series 2004-QA1. At the same time, S&P lowered its rating on class B-2 from series 2003- QS8 and removed it from CreditWatch, where it was placed with negative implications on Oct. 24, 2007. Furthermore, the rating on class B-2 from series 2003-QS4 remains on CreditWatch with negative implications, where it was also placed Oct. 24, 2007. Finally, S&P affirmed its ratings on 28 classes from these and other RALI transactions. The lowered ratings reflect the high delinquencies relative to the available credit support in the deal. Current credit support for classes M-2 and M-3 from series 2004-QA1 and for class B-2 from series 2003-QS8 is 2.18%, 1.66%, and 0.33% of the current pool balance respectively, and future credit support is projected to be significantly lower than the original credit support for all three classes. The amount of overcollateralization available for series 2004-QA1 is at approximately 57% of its target. As of the October 2007 remittance period, cumulative losses for series 2004-QA1 and series 2003-QS8 were 0.30% and 0.20% of the original pool balances, respectively, total delinquencies were 7.60% and 3.03% of the current pool balances, respectively, and severe delinquencies (90-plus days, foreclosures, and REOs) were 2.37% and 0.82% of the current pool balances, respectively. The rating on class B-2 from series 2003-QS4 remains on CreditWatch due to increased delinquencies that could significantly reduce current credit enhancement. As of the October 2007 remittance period, cumulative losses for this transaction were 0.21% of the original principal balance, total delinquencies were 3.94% of the current pool balance, and severe delinquencies were 0.54% of the current principal balance. Standard & Poor's will continue to closely monitor the performance of this transaction. If losses decline to a point at which credit enhancement is not further eroded, S&P will affirm the ratings on this class and remove it from CreditWatch. Conversely, if losses and delinquencies continue to reduce credit support, S&P will likely take further negative rating actions on this class. The affirmations reflect current and projected credit support percentages that are sufficient to support the certificates at their current rating levels. Subordination primarily provides credit support for series 2003- QS8 and 2003-QS4. In addition, class A-3 from series 2003-QS8 benefits from a certificate of guarantee issued by MBIA Insurance Corp. A combination of subordination, excess spread, and O/C provide primary credit support for series 2004-QA1. The underlying collateral for these transactions consists primarily of Alternative-A mortgage loans. The QS deals consist of fixed-rate, fully amortizing, conventional mortgage loans secured by first liens on one- to four-family residential properties, with original terms to maturity of no more than 30 years. The QA deal consists of hybrid adjustable-rate mortgages secured by first liens on one- to four-family residential properties, with original terms to maturity of no more than 30 years. Ratings Lowered Residential Accredit Loans Inc. Rating ------ Series Class To From ------ ----- -- ---- 2004-QA1 M-2 BBB A 2004-QA1 M-3 BB BBB Rating Lowered and Removed from Creditwatch Negative Residential Accredit Loans Inc. Rating ------ Series Class To From ------ ----- -- ---- 2003-QS8 B-2 CCC B/Watch Neg Rating Remaining on Creditwatch Negative Residential Accredit Loans Inc. Series Class Rating ------ ----- ------ 2003-QS4 B-2 B/Watch Neg Ratings Affirmed Residential Accredit Loans Inc. Series Class Rating ------ ----- ------ 2003-QS4 A-1, A-2, A-3, A-4, A-5 AAA 2003-QS4 A-6, A-V, A-P AAA 2003-QS4 M-1 AA+ 2003-QS4 M-2 A+ 2003-QS4 M-3 BBB 2003-QS4 B-1 BB 2003-QS8 A-1, A-2, A-3, A-4, A-5 AAA 2003-QS8 A-6, A-7, A-V, A-P AAA 2003-QS8 M-1 AA 2003-QS8 M-2 A+ 2003-QS8 M-3 BBB 2003-QS8 B-1 BB 2004-QA1 A-I, A-II AAA 2004-QA1 M-1 AA RESIDENTIAL ASSET: Moody's Lowers Ratings on 13 Tranches -------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 13 tranches and has placed under review for possible downgrade the ratings of 5 tranches from 5 deals issued by Residential Asset Securitization Trust in 2006 and late 2005. One downgraded tranche remains on review for possible downgrade. The collateral backing these classes consists of primarily first lien, fixed- rate, Alt-A mortgage loans. The ratings were downgraded and placed under review for downgrade based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. In its analysis Moody's has also applied its published methodology updates to the non delinquent portion of the transaction. Issuer: Residential Asset Securitization Trust 2005-A15 -- Cl. B-2, Downgraded to Baa1, previously A2, -- Cl. B-3, Downgraded to B1, previously Baa2. Issuer: Residential Asset Securitization Trust 2006-A5CB -- Cl. B-1 Currently Aa3 on review for possible downgrade, -- Cl. B-2, Downgraded to Ba3, previously A3, -- Cl. B-3, Downgraded to B3 on review for possible further downgrade, previously Baa3. Issuer: Residential Asset Securitization Trust 2006-A7CB -- Cl. B-1 Currently Aa2 on review for possible downgrade, -- Cl. B-2, Downgraded to Ba2, previously A2, -- Cl. B-3, Downgraded to B3, previously Ba2. Issuer: Residential Asset Securitization Trust 2006-A8 -- Cl. B-1 Currently Aa2 on review for possible downgrade, -- Cl. B-2 Currently Aa3 on review for possible downgrade, -- Cl. B-3, Downgraded to Baa3, previously A2, -- Cl. B-4, Downgraded to Ba3, previously A3, -- Cl. B-5, Downgraded to B2, previously Baa2, -- Cl. B-6, Downgraded to B3, previously Baa3, -- Cl. B-7, Downgraded to Caa2, previously Ba2. Issuer: Residential Asset Securitization Trust 2006-A9CB -- Cl. B-1 Currently Aa2 on review for possible downgrade, -- Cl. B-2, Downgraded to Ba2, previously A2, -- Cl. B-3, Downgraded to B3, previously Baa2. REUNION INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Lead Debtor: Reunion Industries, Inc. dba CP Industries dba Hanna Cylinders dba Chatwins Healthcare Administrators 11 Stanwix Street - Suite 1400 Pittsburgh, PA 15222 Bankruptcy Case No.: 07-50727 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Charles E. Bradley, Sr. Family, L.P. 07-50725 John Grier Poole Family, L.P. 07-50726 Type of Business: The Debtor owns and operates industrial manufacturing operations that design and manufacture engineered, high quality products for specific customer requirements. These products include large diameter seamless pressure vessels, manufactured by its CP Industries division, and hydraulic and pneumatic cylinders, manufactured by its Hanna Cylinders division. In addition, the Debtor has a 65% interest in Shanghai Klemp Metal Products Co., Ltd., a Chinese company located in Shanghai, China. Shanghai Klemp manufactures metal bar grating. Charles E. Bradley, Sr. Family, L.P., and John Grier Poole Family, L.P., are stockholders of the Debtor. Chapter 11 Petition Date: November 26, 2007 Court: District of Connecticut (Bridgeport) Debtors' Counsel: Carol A. Felicetta, Esq. Reid and Riege, P.C. 195 Church Street, 15th Floor New Haven, CT 06510-1819 Tel: (203) 777-8008 Fax: 203-777-6304 Total Assets Total Debts ------------ ------------ Charles E. Bradley, Sr. $0 $0 Family, L.P. John Grier Poole Family, $0 $0 L.P. Reunion Industries, Inc. $0 $1,513,143 A. Reunion Industries, Inc.'s 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Scot Industries $253,399 Attention: President or Managing Agent P.O. Box 0146 Lone Star, TX 75668 Earle M. Jorgensen $130,585 Attention: President or Managing Agent 1900 Mitchell Boulevard Schaumburg, IL 60194 Kwa Properties, L.L.C. $115,286 Attention: President or Managing Agent 844 East Rockland Road Libertyville, IL 60048 Pinnacle Precision Co. $112,263 Tech Syn $98,292 Westfield Bank, F.S.B. $81,712 Steel Supply Co. $75,651 Burgley Gas $74,308 Steelworkers Health & Welfare Fund $72,999 Masterform Tool Co. $61,885 Bearing Distributors $56,771 Wisconsin Steel $48,600 Scot Forge $45,180 Progressive Turnings $45,014 Duquesne Light Co. $42,662 Piedmont Plastics $42,033 B. & D. Cylinders $41,978 Hartman & Hartman $38,794 United Cast Bar $38,331 Pittsburgh Foundry & Machinery $37,400 B. Charles E. Bradley, Sr. Family, LP and John Grier Poole Family, LP do not have any unsecured creditors who are not insiders. RFSC SERIES: Moody's Lowers Rating on Class M-2 Loans to Ba1 ------------------------------------------------------------ Moody's Investors Service downgraded the ratings of three tranches issued in one mortgage transaction. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable- rate scratch and dent mortgage loans. The deals being reviewed have experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses, causing the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: RFSC Series 2004-RP1 Trust -- M-2, Downgraded to Ba1 from A2 -- M-3, Downgraded to Caa2 from Ba2 -- M-4, Downgraded to C from B2 RIDGEVIEW PROFESSIONAL: Case Summary & Seven Largest Creditors -------------------------------------------------------------- Lead Debtor: Ridgeview Professional Complex, L.L.C. 1070 Horizon Ridge Parkway, Suite 100 Henderson, NV 89012 Bankruptcy Case No.: 07-17833 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Corinthian Hills, L.L.C. 07-17834 Gobbles, L.L.C. 07-17835 Type of Business: The Debtors own and manages real estate. Chapter 11 Petition Date: November 27, 2007 Court: District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtors' Counsel: Stephen R. Harris, Esq. Belding, Harris & Petroni, Ltd. 417 West Plumb Lane Reno, NV 89509 Tel: (775) 786-7600 Fax: (775) 786-7764 Estimated Assets Estimated Debts ---------------- --------------- Ridgeview Professional $1 Million to $1 Million to Complex, L.L.C. $100 Million $100 Million Corinthian Hills, L.L.C. $1 Million to $1 Million to $100 Million $100 Million Gobbles, L.L.C. $1 Million to $1 Million to $100 Million $100 Million A. Ridgeview Professional Complex, LLC's Four Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Reeves Construction Co. goods and services $100,000 1070 Horizon Ridge Parkway, Suite 100 Henderson, NV 89012 Lamb Asphalt goods and services $24,313 2516 Losee Road North Las Vegas, NV 89030 K.J.E. Consulting Engineers, goods and services $23,102 Inc. 4130 Sandhill Avenue, Suite A-15 Las Vegas, NV 89121 Project X goods and services $320 B. Corinthian Hills, LLC's Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ John Marchiano, Esq. legal services $10,000 218 Lead Street Henderson, NV 89015 C. Gobbles, LLC's Two Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ K.J.E. Consulting Engineers, goods and services $11,001 Inc. 4130 Sandhill Avenue, Suite A-15 Las Vegas, NV 89121 Dupont Engineering goods and services $8,475 4420 South Arvile Street, Suite 1 Las Vegas, NV 89103 SACO MORTGAGE: Fitch Lowers Ratings on $56.9 Million Certificates ----------------------------------------------------------------- Fitch Ratings has taken these rating actions on two SACO mortgage pass-through certificates. Affirmations total $156.2 million and downgrades total $56.9 million. Break Loss percentages and Loss Coverage Ratios for each class, rated 'B' or higher, are included with the rating actions as: SACO 2005-4 -- $20 million class A affirmed at 'AAA' (BL: 94.56, LCR: 3.42); -- $38 million class M-1 affirmed at 'AA' (BL: 68.02, LCR: 2.46); -- $11.8 million class M-2 affirmed at 'AA-' (BL: 59.08, LCR: 2.13); -- $10.6 million class M-3 affirmed at 'A+' (BL: 50.90, LCR: 1.84); -- $10.1 million class M-4 affirmed at 'A' (BL: 42.99, LCR: 1.55); -- $9.9 million class M-5 downgraded to 'BBB' from 'A-' (BL: 35.23, LCR: 1.27); -- $8.9 million class B-1 downgraded to 'BB' from 'BBB+' (BL: 27.97, LCR: 1.01); -- $8.5 million class B-2 downgraded to 'B' from 'BB' (BL: 20.83, LCR: 0.75); -- $7.8 million class B-3 remains at 'C' with a DR revision from 'DR5' to 'DR6'; -- $9 million class B-4 remains at 'C/DR6'; Deal Summary -- Originators: Various; -- 60+ day Delinquency: 12.91%; -- Realized Losses to date (% of Original Balance): 7.81%; -- Expected Remaining Losses (% of Current Balance): 27.68%; -- Cumulative Expected Losses (% of Original Balance): 15.73%. SACO 2005-WM1 -- $5.2 million class M-1 affirmed at 'AA' (BL: 98.78, LCR: 3.01); -- $13.2 million class M-2 affirmed at 'AA-' (BL: 89.86, LCR: 2.73); -- $12.3 million class M-3 affirmed at 'A+' (BL: 78.12, LCR: 2.38); -- $11.6 million class M-4 affirmed at 'A' (BL: 66.24, LCR: 2.02); -- $11.2 million class M-5 affirmed at 'A-' (BL: 55.00, LCR: 1.67); -- $11.6 million class B-1 affirmed at 'BBB+' (BL: 43.37, LCR: 1.32); -- $10.2 million class B-2 downgraded to 'BB' from 'BBB' (BL: 32.97, LCR: 1.0); -- $9.8 million class B-3 downgraded to 'C/DR5' from 'BBB-'; -- $9.3 million class B-4 downgraded to 'C/DR6' from 'B'; -- $5.1 million class B-5 remains at 'C/DR6'; Deal Summary -- Originators: 100% Long Beach; -- 60+ day Delinquency: 18.48%; -- Realized Losses to date (% of Original Balance): 7.05%; -- Expected Remaining Losses (% of Current Balance): 32.85%; -- Cumulative Expected Losses (% of Original Balance): 14.25%. The information above is based off the October 2007 remittance period. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2006 and late 2005 with regard to continued poor loan performance and home price weakness. Minimum LCR's specifically for subprime second lien transactions are as follows: AAA: 2.00; AA: 1.75; A: 1.50; BBB: 1.20; BB 0.95; B: 0.75. SAN HOLDINGS: Files for Bankruptcy Under Chapter 7 in Colorado -------------------------------------------------------------- SAN Holdings, Inc., along with its two wholly-owned subsidiaries, filed a voluntary petition for relief under Chapter 7 of the U.S. Bankruptcy Code with the U.S. Bankruptcy Court for the District of Colorado on Nov. 26, 2007. No bankruptcy trustee has been appointed so far. Cease of Funding Earlier, the company had disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that it was exploring either a sale of the assets of the company or filing for bankruptcy. The disclosure came after Sun Capital Partners II, LP, informed the company on Nov. 9, 2007, that it was going to cease it funding of the company, including through the $10 million credit facility that the Company maintains with it. Sun Capital II is an affiliate of the company's majority shareholder. Avnet Default The company purchases more than half of its products from Avnet. Avnet holds a security interest in all of the company's assets, whereby all indebtedness with Avnet is secured, except for $1,000,000. This security interest is subordinate to the security interest granted to Wells Fargo in connection with the company's borrowing facility with Wells Fargo. On Nov. 15, 2007, Avnet issued a letter of default to the company demanding immediate payment of all past due amounts, for a total of $1.3 million, and informed the company of its decision to cease selling to the company on trade credit terms. The company didn't have sufficient liquidity to satisfy Avnet's demand of payment. As of November 19, the total amount due to Avnet, including past due and current amounts, was $2.9 million. Wells Fargo Default The company has a revolving credit line with Wells Fargo to borrow up to $12.0 million, which is secured by substantially all assets of SANZ Inc. and Solunet Storage. As of November 19, the company has approximately $3.0 million outstanding on this borrowing facility. The company's ability to borrow under the Wells Fargo facility is subject to the amount of its accounts receivable balance, as well as complying with the financial covenants under the borrowing facility. Financial covenants for 2007 are: (1) minimum net income (loss) on a year to date basis, calculated quarterly; (2) minimum net worth plus "subordinated debt" (measured in the aggregate, with amounts loaned to the Borrowers from San Holdings, Inc. being defined as subordinated debt), calculated on a monthly basis; (3) minimum availability, calculated monthly; (4) capital expenditure limit, calculated on an annual basis; and (5) a minimum cash infusion from San Holdings, Inc. or an outside source if the Borrowers generate a net loss in a given quarter and have generated a net loss on a year to date basis at that time, in an amount equal to the lesser of the quarterly net loss or the year to date net loss. The company disclosed that as of November 19, it was in default under certain of its covenants with Wells Fargo. Resignations Effective as of its bankruptcy filing, Todd A. Oseth voluntarily resigned as the Chief Executive Officer, President and Chairman of the Board of Directors of the Company, from any committees on which he served and from any other positions held with the company or its affiliates. The company says it is not aware of any matters of disagreement concerning operations, policies or practices between the Company and Mr. Oseth causing his decision to resign. David I. Rosenthal also voluntarily resigned as Chief Financial Officer, Secretary and Treasurer of the company. Independent Directors Kent J. Lund, George Rea, and Daryl Hollis also handed their voluntarily resignations from the company's Board of Directors and from any committees on which they served. SAN Holdings, Inc. provides enterprise-level data storage and data management solutions to commercial and government clients. The company designs, delivers, services and sometimes manages data storage systems. Sun Capital Partners is the company's majority shareholder. SAN HOLDINGS: Voluntary Chapter 7 Case Summary ---------------------------------------------- Debtor: San Holdings, Inc. 9800 Pyramid Court, Suite 130 Englewood, CO 80112 Bankruptcy Case No.: 07-23707 Debtor-affiliates filing separate Chapter 7 petitions: Entity Case No. ------ -------- SANZ, Inc. 07-23710 Solunet Storage, Inc. 07-23713 Type of Business: The Debtor provides enterprise-level data storage and data management solutions to commercial and government clients. The Debtor designs, delivers, services and sometimes manages data storage systems. Sun Capital Partners is the company's majority shareholder. Chapter 7 Petition Date: November 26, 2007 Court: District of Connecticut (Bridgeport) Debtor's Counsel: Risa Lynn Wolf-Smith, Esq. Holland & Hart LLP 555 17th Street, Suite 3200 Denver, CO 80201 Tel: (303) 295-8011 Financial Condition as of Sept. 30, 2007: Total Assets: $10,114,000 Total Debts: $29,642,000 The Debtors' did not file a list of their 20 largest unsecured creditors. SAVE OUR SPRINGS: To Pay Creditors from $60,000 Settlement Fund --------------------------------------------------------------- Save Our Springs Alliance informed the Honorable Craig Gargotta of the U.S. Bankruptcy Court for the Western District of Texas of its intention to pay its creditors from a $60,000 Settlement Fund, Asher Price of Statesman reports. However, the Debtor's creditor, Bill Gunn, continues to hope for the liquidation of the company, Statesman relates. Creditors Hays-Cypress and Mak Foster Ranch, on the contrary, showed support to the plan on the condition that the Debtor will withdraw its appeals on the lawsuit judgments, Statesman says. The Court has not indicated a date to make a ruling on the matter, Statesman adds. Save Our Springs Alliance -- http://www.sosalliance.org/-- is a non-profit organization whose aim is to protect the Edwards Aquifer in Texas, its springs and contributing streams, and the natural and cultural heritage of its Hill Country watersheds, with special emphasis on the Barton Springs Edwards Aquifer. The Alliance filed for chapter 11 bankruptcy on April 10, 2007 (Bankr. W.D. Texas Case No. 07-10642). Weldon Ponder, Esq., represents the Debtor in its restructuring efforts. SOS Alliance filed for bankruptcy after the Texas Supreme Court upheld the Court of Appeals ruling and declined to review the case Save Our Springs Alliance v. Lazy Nine Municipal Utility District. In addition, SOS Alliance was directed to pay $500,000 in attorneys' fees. SBA CMBS: Fitch Affirms 'B+' Rating on $71 Million Certificates --------------------------------------------------------------- Fitch Ratings affirms these classes of SBA CMBS Trust, series 2005-1 and 2006-1 commercial mortgage pass-through certificates: Series 2005-1: -- $238,580,000 class 2005-1A at 'AAA'; -- $48,320000 class 2005-1B at 'AA'; -- $48,320,000 class 2005-1C at 'A'; -- $48,320000 class 2005-1D at 'BBB'; -- $21,460,000 class 2005-1E at 'BBB-'. Series 2006-1: -- $439,420,000 class 2006-1A at 'AAA'; -- $106,680,000 class 2006-1B at 'AA'; -- $106,680,000 class 2006-1C at 'A'; -- $106,680,000 class 2006-1D at 'BBB'; -- $36,540,000 class 2006-1E at 'BBB-'; -- $81,000,000 class 2006-1F at 'BB+'; -- $121,000,000 class 2006-1G at 'BB'; -- $81,000,000 class 2006-1H at 'BB-'. -- $71,000,000 class 2006-1J at 'B+'. The affirmations are due to the stable performance of the collateral. SBA CMBS Trust, series 2005-1 closed on November 18, 2005 and was secured by 1,714 wireless communication sites. SBA CMBS Trust, series 2006-1 represents an additional issuance with the contribution of 3,261 additional sites. As of September 2007, the collateral pool included 4,974 wireless communication sites owned, leased, or managed by the borrower. The notes issued by both transactions, which are secured by the same pool, are pari passu among like rated classes. As of the October 2007 distribution date, the aggregate principal balance of the notes remained unchanged at $1.555 billion since issuance. Notes from both issuances are interest only for the entire five- year period. As part of the review, Fitch analyzed the management report dated September 30, 2007 that was provided by the servicer, Midland Loan Services. As of Sept. 30, 2007, aggregate annualized run rate revenue increased 6.8% to $286.3 million from $268.1 million at issuance. Over the same time period, the Fitch adjusted net cash flow increased 11.2% since issuance. The tenant type concentration is stable. As of September 30, 2007, total revenue contributed by telephony tenants was 94.2% compared to 95.2% at issuance. SEA CONTAINERS: Wants Exclusive Period Extended to February 20 -------------------------------------------------------------- Sea Containers Ltd. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to further extend their exclusive periods to file a Chapter 11 plan through and including Feb. 20, 2008, and to solicit acceptances of that plan through and including April 19. Sean T. Greecher Esq., at Young Conaway Stargatt & Taylor, LLP, relates that since their last request to extend the exclusive periods, the Debtors have made substantial progress towards developing a viable chapter 11 plan. In particular, Mr. Greecher says, the Debtors have: (a) stabilized their business operations; (b) disposed of certain non-core assets, thereby bringing in cash proceeds to the estates; (c) addressed complex intercompany issues; (d) reached a settlement regarding the Company's corporate headquarter's lease; (e) obtained Court approval for additional funding for Sea Containers Treasury Limited, the Company's non-debtor vehicle, to fund non-debtor subsidiary operations; (f) obtained replacement financing for Sea Containers SPC Ltd.'s prepetition securitization facility in the form of DIP financing; and (g) obtained approval for exit financing to pay certain due diligence fees and expenses. Nonetheless, Mr. Greecher continues, the resolution of two critical issues remain to complete preparation of a Plan Reorganization: (1) settlement of the Debtors' pension scheme liabilities; and (2) factoring in the upcoming decision on the change of control arbitration. Both issues are at the verge of conclusion, Mr. Greecher assures the Court. The Debtors have also initiated discussions with the creditors committees on potential chapter 11 plan alternatives, Mr. Greecher adds. To resolve issues with regard to the pension scheme liabilities, the Debtors have facilitated and mediated discussions among the creditors committees and the pension trustees, while supplying all parties with extensive due diligence and other information regarding the status of the Pension Trustee's claims. Mr. Greecher reports that negotiation has now reached a critical juncture. In fact, recently, the parties have significantly narrowed their differences on the status of the Pension Trustee's claims, and intensive discussions are continuing, he explains. As for the progress in the change of control arbitration with GE Capital, the Debtors undertook discovery and prepared for, defended, and took depositions, related to the change of control dispute in August and September 2007. The Debtors' extensive preparation of the change of control arbitration culminated in hearings conducted in mid- and late October, ultimately concluding on November 5. The parties now have submitted post-hearing briefs and expect a decision from the arbitrator no later than mid-December, Mr. Greecher says. According to Mr. Greecher, the arbitrator's decision will influence which of the various plan alternatives the Debtors will ultimately pursue. The outcome of the change of control arbitration will also facilitate the Debtors' efforts to obtain exit financing by giving the Debtors' potential exit lenders a better view of the Debtors' exit Plan. The Debtors believe that continued exclusivity will allow space to finally resolve the two ongoing issues. Terminating exclusivity, and introducing the prospect of a competing plan will only distract all parties concerned, the Debtors add. The Debtors further note that the requested extension of the Exclusive Periods will allow them to reach a final resolution, and propose a confirmable plan. Conversely, failure to obtain the requested extension may unravel the resolutions the Debtors have worked to obtain and engender costly litigation that would consume the estate, delay their emergence from chapter 11, and deplete the funds available for distribution to creditors. About Sea Containers Headquartered in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Debtors' exclusive period to file a chapter 11 plan expires on Dec 21, 2007. (Sea Containers Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SEA CONTAINERS: Court Approves Payment of Diligence Fees -------------------------------------------------------- The Hon. Kevin Carey of the U.S. Bankruptcy Court for the District of Delaware authorized Sea Containers Ltd. and its debtor- affiliates to pay the due diligence fees or expenses of potential exit lenders up to a maximum amount of $500,000 per lender and $1,500,000 in the aggregate. The amount is for reasonable expenses incurred in connection with financial and legal due diligence and development of exit financing proposals that relate to taking out the existing DIP loan upon the Debtors' emergence from Chapter 11. The Order is entered without prejudice to the Debtors' right to seek authority to pay additional expenses or fees related to exit financing as the Debtors believe are reasonable and necessary, Judge Carey said. Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, related that the Debtors are in the process of formulating a Chapter 11 plan and intend to commence their exit from Chapter 11 by filing their plan, disclosure statement, and related materials in the near term. Under any plan scenario, Mr. Morton said, exit financing to repay the DIP loan and provide going-forward capital is an essential component of this process. For these reasons, the Debtors are currently pursuing exit financing from various lenders and are aiming to secure a commitment to fund their exit from Chapter 11. To make a financing commitment, however, potential exit lenders will have to conduct extensive due diligence of the Debtors' assets and operations, thereby incurring significant out-of- pocket costs and expenses, including fees and expenses of their legal and other advisors. To induce potential exit lenders to undertake the expensive and time-consuming work required for an exit financing commitment, the Debtors believe it is necessary to pay the reasonable and actual out-of-pocket costs and expenses they incur in connection with developing, negotiating, and documenting the financing commitment. Without this inducement -- which is a quite common request under the circumstances -- potential exit lenders will not undertake the work needed to complete a financing commitment, thus leaving the Debtors without an exit facility required for their Chapter 11 plan, Mr. Monton explained. He further noted that the Debtors have already received interest from Dune Capital LP and Caspian Capital Partners LP to provide exit financing, but they are unwilling to proceed further unless they are reimbursed for their out-of-pocket costs and expenses associated with their due diligence review ofthe Debtors. In addition to Dune and Caspian, the Debtors hope to pursue exit financing negotiations with other lenders. Parallel negotiations with multiple potential exit lenders will ensure that the Debtors obtain financing with competitive terms, Mr. Monton said. The Debtors believe that the requested expense reimbursement is reasonable for the proposed collateral base, which will include all of the Debtors' assets, including their interests in GE SeaCo and the large network of foreign and U.S. non-debtor subsidiaries, and the fact that the expenses routinely are reimbursed both in and outside of bankruptcy. About Sea Containers Headquartered in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Debtors' exclusive period to file a chapter 11 plan expires on Dec 21, 2007. (Sea Containers Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SECURED ASSETS: Richard Kipperman Appointed as Chapter 11 Trustee ----------------------------------------------------------------- The Honorable Peter W. Bowie of the United States Bankruptcy Court for the Southern District of California appointed Richard Kipperman to serve as Chapter 11 Trustee for Secured Assets Trust and SAIF Inc.'s bankruptcy case. On Oct. 16, 2007, Haije Hong, the U.S. Trustee for Region 15, asks the Court to dismiss the Debtors' bankruptcy case or, in the alternative, appoint a Chapter 11 Trustee after Judge Bowie denied on Oct. 10, 2007, the employment of Van Dyke & Associates as the Debtors' proposed counsel. Mr. Hong said that Debtors' can't proceed in their Chapter 11 case without an attorney representing it. According to the Southern District of California's Local District Civil Rule, "[w]henever a corporation desires or is required to make an appearance in Southern District, the appearance shall be made only by an attorney of the bar of this court or an attorney permitted to practice pursuant to Civil Local Rule 83.3," Mr. Hong points out. Furthermore, Mr. Hong contends that Debtors may not be a "business trust" that is eligible to be a debtor pursuant to Section 101(9)(A)(v) of the Bankruptcy Court. Headquartered in Encinitas, California, Secured Assets Trust aka Secured Assets provide commercial inventory financing loans to used automobile dealerships. Secured Assets and its subsidiary, SAIF, Inc., filed for Chapter 11 protection on Aug. 20, 2007 (Bankr. S.D. Calif. Case No. 07-04501). When the Debtors' filed for protection against the its creditors, Secured Assets listed total assets at $15,898,044 and total debts $15,898,044, while SAIF Inc. listed total assets at $10,349,530 and total debts at $16,397,887. SILVER ELMS: Moody's Cuts Rating on $8 Million Notes to B2 ---------------------------------------------------------- Moody's Investors Service placed these notes issued by Silver Elms CDO II Limited on review for possible downgrade: Class Description: $87,500,000 Class A-2 Floating Rate Senior Secured Notes due 2051 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $74,000,000 Class A-3 Floating Rate Senior Secured Notes due 2051 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade Class Description: $28,000,000 Class B Floating Rate Subordinate Secured Notes due 2051 -- Prior Rating: Aa2 -- Current Rating: Aa2, on review for possible downgrade In addition Moody's also announced that it has downgraded and left on review for possible downgrade these notes: Class Description: $13,500,000 Class C Floating Rate Junior Subordinate Secured Deferrable Notes due 2051 -- Prior Rating: A2 -- Current Rating: Baa3, on review for possible downgrade Class Description: $12,000,000 Class D Floating Rate Junior Subordinate Secured Deferrable Notes due 2051 -- Prior Rating: Baa2 -- Current Rating: Ba3, on review for possible downgrade Class Description: $8,000 000 Class E Notes due 2051 -- Prior Rating: Ba2 -- 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. SINOFRESH HEALT: Sept. 30 Balance Sheet Upside-Down by $2.8 Mil. ---------------------------------------------------------------- SinoFresh HealthCare Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $2.0 million in total assets and $4.8 million in total liabilities, resulting in a $2.8 million total shareholders' deficit. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $76,221 in total current assets available to pay $4.8 million in total current liabilities. The company reported a net loss of $381,647 on revenue of $40,280 for the third quarter ended Sept. 30, 2007, compared with a net loss of $449,437 on revenue of $155,079 in the same period last year. The company believes that the revenue decrease was a combination of the lack of marketing and advertising activities and the elimination of incentive programs such as rebates that were offered in 2006. In addition, the company lost distribution to Wal-Mart in the third quarter of 2006. 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?25cf Going Concern Doubt As reported in the Troubled Company Reporter on May 2, 2007, Moore Stephens Lovelace, P.A., expressed substantial doubt about SinoFresh HealthCare Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm reported that the company is in default on its debenture obligations, has incurred substantial losses since its inception, has a working capital deficiency at Dec. 31, 2006, and has incurred negative cash flow from operations. Although the company was able to secure an equity line that resulted in the settlement and payoff of the majority of its outstanding debentures, the company still requires additional funding in order to repay its debentures and to market and distribute its products, exploit the technology underlying its patents, further develop existing and new products, and pay its other existing current liabilities. About SinoFresh HealthCare Headquartered in Englewood, Florida, SinoFresh HealthCare Inc. (OTC BB: SFSH) -- http://www.sinofresh.com/-- develops and markets innovative ear, nose, and throat products. The company holds several patents on its innovative pharmaceutical technology. SPECIALTY UNDERWRITING: Fitch Holds 'BB' Rating on $2.7MM Trust --------------------------------------------------------------- Fitch Ratings has taken rating actions on one Specialty Underwriting and Residential Finance Trust Transaction. Affirmations total $99.5 million. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: SURF 2005-AB1 -- $59 million class A affirmed at 'AAA' (BL: 51.08, LCR: 5.42); -- $7.8 million class M1 affirmed at 'AA+' (BL: 41.45, LCR: 4.4); -- $11 million class M2 affirmed at 'AA' (BL: 31.85, LCR: 3.38); -- $6.7 million class M3 affirmed at 'A' (BL: 25.21, LCR: 2.68); -- $4 million class M4 affirmed at 'A-' (BL: 21.09, LCR: 2.24); -- $4.7 million class B1 affirmed at 'BBB+' (BL: 16.08, LCR: 1.71); -- $3.3 million class B2 affirmed at 'BBB-' (BL: 11.48, LCR: 1.22); -- $2.7 million class B3 affirmed at 'BB' (BL: 10.48, LCR: 1.11). Deal Summary -- Originators: MILA, Inc. (45.60%), Wilmington Finance (28.59%) -- 60+ day Delinquency: 19.53%, -- Realized Losses to date (% of Original Balance): 0.63%; -- Expected Remaining Losses (% of Current Balance): 9.42%; -- Cumulative Expected Losses (% of Original Balance): 4.15%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. STANDARD PACIFIC: Denies Rumors of Looming Bankruptcy Filing ------------------------------------------------------------ Standard Pacific Corp. disputed rumors that it will be seeking chapter 11 bankruptcy protection soon, Robb Crocker of Builder Online reports. Talking to the press Tuesday at a JPMorgan 2007 Homebuilding and Building Products Conference in Las Vegas, CEO Stephen J. Scarborough called the information as "speculation," Builder Online relates. "There has been no effort on our part for filing bankruptcy. We have a good record of working with our banks and a plan in place to generate and preserve cash," Mr. Scarborough was cited by Builder Online as saying. Third Quarter Loss As reported in the Troubled Company Reporter on Oct. 29, 2007, for the three months ended Sept. 30, 2007, the company incurred a net loss of $119,666,000 compared to net income of $30,847,000 for the same period last year. The company's total revenues for the current quarter decreased to $677,846,000 from $839,839,000 for the same quarter in 2006. At Sept. 30, 2007, the company's balance sheet showed total assets of $4,029,938,000, total liabilities of $2,554,149,000, and total stockholders' equity of $1,431,488,000. S&P Takes Rating Action As reported in the Troubled Company Reporter on Nov. 6, 2007, Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured ratings on Standard Pacific Corp. to 'BB-' from 'BB'. Additionally, S&P lowered the rating on the company's senior subordinated debt to 'B' from 'B+'. The outlook remains negative. The rating actions affect $1.35 billion of rated securities. "The downgrades follow the company's recent quarterly loss and anticipate further pressure on Standard Pacific's liquidity position," said credit analyst George Skoufis. The rating agency also said that the company's bank covenants could come under pressure if additional impairments are incurred, which would diminish the equity base. S&P expect market conditions to remain challenging into 2009, which will place further pressure on Standard Pacific's more geographically concentrated platform. S&P said it will lower the company's ratings if further deterioration in the housing market results in weaker-than- expected liquidity and/or additional covenant challenges. About Standard Pacific Headquartered in Irvine, Calif., Standard Pacific Corp. (NYSE:SPF) -- http://www.standardpacifichomes.com/-- is a homebuilder with operations in California, Florida, Arizona, the Carolinas, Texas, Colorado, Nevada and Illinois. The company also provides mortgage financing and title services to its homebuyers through its subsidiaries and joint ventures, Standard Pacific Mortgage Inc., Home First Funding, SPH Home Mortgage, Universal Land Title of South Florida and SPH Title. STRUCTURED ASSET: S&P Junks Rating on Class M3 Certificates ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class M1, M2, and M3 mortgage pass-through certificates from Structured Asset Securities Corp.'s series 2003-12XS. Concurrently, S&P affirmed its rating on class A5 from this series. The downgrade of classes M1, M2, and M3 reflect the high delinquencies relative to the available credit support in the deal. Current credit support for classes M1, M2, and M3 is 7.90%, 4.15%, and 0.00 of the current pool balance, respectively, and future credit support is projected to be significantly lower than the original credit support for all three classes. As of the October 2007 remittance period, cumulative losses were approximately $1.66 million, or 0.57% of the original principal balance, total delinquencies were 17.85% of the current principal balance, and severe delinquencies (90-plus-days, foreclosures, and REOs) were 12.99% of the current principal balance. The affirmation of the rating on class A5 reflects actual and projected credit support percentages that are sufficient to support the class at its current rating level. A combination of subordination and excess spread provide credit support for this transaction. The underlying collateral for this series consists primarily of Alternative-A, fixed-rate, fully amortizing conventional mortgage loans secured by first liens on one- to four-family residential properties. Ratings Lowered Structured Asset Securities Corp. Mortgage pass-through certificates Rating ------ Series Class To From ------ ----- -- ---- 2003-12XS M1 A AA 2003-12XS M2 BB A 2003-12XS M3 CCC B Ratings Affirmed Structured Asset Securities Corp. Mortgage pass-through certificates Series Class Rating ------ ----- ------ 2003-12XS A5 AAA STRUCTURED ASSET: Moody's Cuts Rating on Class M4 Loans to B3 ------------------------------------------------------------- Moody's Investors Service downgraded the ratings of two tranches issued in one mortgage transaction. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable- rate scratch and dent mortgage loans. The amount of available credit enhancement has been reduced from losses and stepdown. The timing of losses coupled with passing of performance triggers has caused the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: Structured Asset Securities Corp Trust 2004-GEL1 -- Cl. M3, Downgraded to Ba2 from Baa2 -- Cl. M4, Downgraded to B3 from Baa3 SUNNY DELIGHT: Improved Performance Cues S&P to Lift Rating ----------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Cincinnati, Ohio-based Sunny Delight Beverages Co. to 'B-' from 'CCC+'. The outlook is stable. "The upgrade reflects Sunny Delight's improved operating performance and liquidity position, and increasing diversification of its brand, product portfolio, and distribution channels," said Standard & Poor's credit analyst Bea Chiem. Sunny Delight is a global manufacturer and distributor of juice drinks under the Sunny Delight, Elations, Fruit Simple, Fruit2O, and Veryfine brand names. The rating on Sunny Delight reflects its narrow product portfolio, limited size within the highly competitive and somewhat fragmented global juice industry, and moderately leveraged financial profile. The juice drink company is majority owned by financial sponsor J.W. Childs Associates L.P. T&B MORTGAGE: Case Summary & 14 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: T&B Mortgage Corporation 2812 Old Lee Highway Suite 300 Fairfax, VA 22031 Bankruptcy Case No.: 07-13630 Chapter 11 Petition Date: November 26, 2007 Court: Eastern District of Virginia (Alexandria) Debtor's Counsel: Russell B. Adams, III, Esq. Chung & Press 6718 Whittier Avenue, Suite 200 McLean, VA 22101 Tel: (703) 734-3800 Fax: (703) 734-0590 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 14 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ FIA Card Services, N.A. Bank Loan $524,960 c/o Brian Kenney, Esq. 1751 Pinnacle Drive, Suite 500 McLean, VA 22102 Wachovia Bank Bank Loan $321,281 P.O. Box 96074 Charlotte, NC 28296 United Health Care Insurance Co. Trade Debt $28,019 c/o Kevin M. Fitzpatrick, P.C. 10615 Judicial Drive, Suite 603 Fairfax, VA 22030 Washington Appraisal Trade Debt $21,125 Appraisals One Trade Debt $15,450 Bank of America Trade Debt $13,000 County of Fairfax $11,413 CIT Technology Financial Trade Debt $10,380 Services, Inc. First America CREDCO $6,799 Office Depot Trade Debt $6,217 Long Ngo Trade Debt $3,825 Keystone Appraisal Group Trade Debt $3,600 Verizon West Virginia, Inc. Trade Debt $1,379 AT&T Trade Debt $590 TARRAGON CORP: Provides Update on Addressing Liquidity Issues ------------------------------------------------------------- Tarragon Corporation reported further progress on addressing its liquidity issues. Tarragon completed the sale of five properties which included two residential properties: -- Deerwood Village in Ocala, Florida; -- Vista Grand in Tampa, Florida; -- two commercial properties in Midway Mills in Dallas, Texas; -- 290 Veterans in Rutherford, New Jersey; and -- a land development project in Orlando, Florida. The aggregate sales price for these properties was $89.6 million, resulting in approximately $16.5 million of net proceeds to Tarragon after distributions to partners and repayment of $66.6 million of debt. Tarragon estimates that it will realize a net pre-tax gain, after giving effect to impairment charges to be recorded for certain of the properties, of approximately $6 million from the sale of these five properties. Tarragon currently has six other properties under contract for sale that are presently expected to close by year-end. The aggregate sales price for these properties is approximately $280 million. These pending sales, which remain subject to customary closing conditions, are estimated to yield net cash proceeds of $54 million, after partner distributions and repayment of $203 million of debt. Tarragon expects to realize a pre-tax gain, after giving effect to impairment charges to be recorded for two of the properties, of approximately $43 million on these sales. Since March 31, 2007, Tarragon has sold 14 properties for an aggregate sales price of $279 million. These sales have generated net cash proceeds of $44 million and reduced the company's consolidated debt by over $200 million. Tarragon expects to record pre-tax impairment charges of approximately $350 million when it reports its financial results for the second and third quarters of 2007. The charges stem from both realized losses on the sales of properties as well as write downs to reflect the estimated fair value of properties still held by the company. The Nasdaq Listing Qualifications Panel granted the company an extension to file its Form 10-Qs for the quarters ended June 30 and Sept. 30, 2007. With this extension, Tarragon's common stock will continue to be listed on the Nasdaq Global Select Market, subject to filing these reports with the SEC on or before Dec. 21, 2007. Tarragon also has entered into agreements with National City Bank and Regions Bank to restore to good standing a combined $130 million in loans made to Tarragon and/or its affiliates. To date, Tarragon has restored approximately $950 million in loans to good standing. Negotiations continue with one remaining major lender for the satisfaction or reinstatement of a loan of $160 million on six properties. These transactions are part of an overall plan designed to improve the company's liquidity and financial condition. The plan contemplates additional property sales, the proceeds of which will continue to be used to repay Tarragon's outstanding debt, satisfy other obligations and to provide additional liquidity while it restructures and streamlines the organization to reposition the company for future opportunities. "In the past several months, we have made good progress by reinstating to good standing most of our outstanding debt and improving our liquidity through the sale of non-core properties," William S. Friedman, the company's chairman and chief executive officer, commented. "Given current conditions in the real estate and credit markets, we still face significant challenges, including covenant non- compliance under our existing $125 million of subordinated debt, with respect to which short term waivers have been received," he added. "The special committee formed last August is continuing to work with Lazard, the company's financial advisor, to evaluate strategic and other alternatives." About Tarragon Corporation Based in New York City, Tarragon Corporation (NASDAQ:TARR) -- http://www.tarragoncorp.com/-- develops multifamily housing for rent and for sale. Tarragon's operations are concentrated in the Northeast, Florida, Texas and Tennessee. * * * As reported in the Troubled Company Reporter on Aug. 20, 2007, Tarragon Corp. disclosed in a regulatory filing with the Securities and Exchange Commission that it received a notice of default and demand from Barclays Capital Real Estate Inc. related to six promissory notes made in favor of Barclays by certain direct or indirect wholly owned subsidiaries of the company. TCM MEDIA: Completed Sale Cues Moody's to Affirm B2 Rating ---------------------------------------------------------- Moody's Investors Service has affirmed TCM Media, Inc.'s B2 Corporate Family rating, and changed the rating outlook to developing from negative following the company's announcement that it has completed the sale of Host Communications, Inc. and Pinnacle Sports Productions, LLC to IMG World, Inc. Details of the rating action are: Ratings Affirmed: Issuer: TCM Media, Inc. -- Corporate Family Rating, B2 -- Probability of Default Rating, B2 -- Senior Secured Second Lien Term Loan, Caa1 LGD5, 82% -- Speculative Grade Liquidity Assessment, SGL-3 Ratings Upgraded: Issuer: TCM Media, Inc. -- Senior Secured First Lien Revolving Credit Facility, to Ba3 LGD2, 27% from B1 LGD3, 39% -- Senior Secured First Lien Term Loan, to Ba3 LGD2, 27%, from B1 LGD3, 39% The rating outlook has been changed to developing from stable. The affirmation of TCM's B2 corporate family rating reflects the reduction of the company's total debt partly offset by the loss of EBITDA from the sold businesses. TCM's pro-forma leverage decreased to 7.2 times EBITDA at the end of September 2007, calculated according to Moody's standard adjustments. The rating affirmation also incorporates Moody's expectation that leverage will decline further as TCM reduces the level of corporate overhead necessary to support the reduced needs of its surviving newspaper publishing business. The B2 CFR reflects the company's high leverage, its small size (approximately $48 million in sales), its dependence upon six community newspapers for virtually all of its business, and the lower margins of the Gwinnett Daily Post, which is provided to cable subscribers within the Lawrenceville, Georgia area . In addition the B2 CFR incorporates the problems which continue to beset the newspaper publishing sector, including soft advertising spending, declining circulation count and electronic substitution. The upgrade of the senior secured first lien revolving credit facility and term loan to Ba3 from B1 largely results from the company's repayment of $66.5 million of first lien debt (from the proceeds of the sale of Host and Pinnacle) resulting in higher recovery prospects to first lien lenders and a proportionately higher cushion of loss provided by second lien debt. The affirmation of TCM's SGL-3, speculative grade liquidity rating reflects a very limited liquidity position over the next twelve months, with limited access to external sources of liquidity as the company has only $3 million in undrawn availability under its $20 million revolving credit facility. The developing outlook incorporates uncertainty regarding the company's ultimate capital structure. Moody's expects that, with the sale of its sports-related businesses completed, TCM will consider further revisions to its capital structure, either through a refinancing of its remaining debt or through a sale of some or all of the company's remaining newspaper publishing businesses. On Nov. 15, 2007, TCM consummated the sale of Host Communications, Inc. and Pinnacle Sports Productions, LLC to IMG World, Inc., for a price of approximately $74 million. Net proceeds of $65.5 million (after approximately $6.4 of escrow payments) have been used to permanently reduce TCM's first lien term loan. TCM Media, Inc is a newspaper publishing company headquartered in Lexington, Kentucky. For the period ended June 30, 2007, the company reported revenues of $48 million pro-forma for the sale of its sports-related businesses. TERWIN MORTGAGE: S&P Puts Default Rating on Class B-5 Loans ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on classes 1-M-3 and 2-B-4 from Terwin Mortgage Trust 2004-13ALT to 'BB' from 'BBB+' and to 'B' from 'BB', respectively, and on class B-5 from series 2005-18ALT to 'D' from 'CCC'. At the same time, S&P affirmed its ratings on the 10 remaining classes from series 2004- 13ALT. The downgrades of the classes from series 2004-13ALT reflect the high delinquencies relative to the available credit support in the deal. Current credit support for classes 1-M-3 and 2-B-4 from series 2004-13ALT is 3.88% and 1.41% of the current pool balance, respectively, and future credit support is projected to be significantly lower than the original credit support for both of these classes. The amount of overcollateralization for this transaction is at approximately 93% of its target. The lowered rating on class B-5 from series 2005-18ALT reflects the complete erosion of the credit support and the subsequent write-downs for this class. Class B-5 realized $169,712 in losses during the October 2007 remittance period. As of the October 2007 remittance period, cumulative losses for series 2004-13ALT were 0.004% of the original pool balance, total delinquencies were 7.90% of the current pool balance, and severe delinquencies (90-plus days, foreclosures, and REOs) were 7.56% of the current pool balance. The affirmations reflect current and projected credit support percentages that are sufficient to support the certificates at their current rating levels. A combination of subordination, excess spread, and O/C provide primary credit support for series 2004-13ALT. Subordination primarily provides credit support for series 2005-18ALT. The underlying collateral for these transactions consists primarily of Alternative-A, adjustable- and fixed-rate mortgage loans, secured by first liens on residential properties. Ratings Lowered Terwin Mortgage Trust Rating ------ Series Class To From ------ ----- -- ---- 2004-13ALT 1-M-3 BB BBB+ 2004-13ALT 2-B-4 B BB 2005-18ALT B-5 D CCC Ratings Affirmed Terwin Mortgage Trust Series Class Rating ------ ----- ------ 2004-13ALT 1-A-2, 1-A-4 AAA 2004-13ALT 1-M-1 AA+ 2004-13ALT 1-M-2 A+ 2004-13ALT 2-PA-1, 2-P-X AAA 2004-13ALT 2-B-1 AA 2004-13ALT 2-B-2 A 2004-13ALT 2-B-3, 2-B-X BBB TESORO CORP: Tracinda Withdraws Common Stock Tender Offer --------------------------------------------------------- Tracinda Corporation disclosed that after consideration, it is withdrawing, effective immediately, its cash tender offer at $64.00 per share for up to 21,875,000 shares, or approximately 16% of the outstanding shares, of Tesoro Corporation common stock. While Tracinda was encouraged by management's execution of Tesoro's strategic plan and expression of interest to Tracinda in enhancing shareholder value, Tracinda is unwilling to become a substantial investor in a company in which the shareholders do not come first. The rights plan adopted by the Tesoro board of directors inhibits value for all Tesoro shareholders by, among other things, restricting the ability of shareholders to vote, sell or acquire Tesoro shares freely without fear of triggering the draconian provisions of the rights plan. Tracinda, as an investor in public companies where it has enhanced value for all shareholders, noted that it had made clear to Tesoro's management that it looked forward to cooperating with management to identify ways to enhance the value of the company for all shareholders and is disappointed that by adopting the rights plan Tesoro has elected to significantly impede the prospects for shareholder value creation. The tender offer was scheduled to expire at 11:59 p.m., New York City time, on Dec. 6, 2007. Any shares tendered to Tracinda will be promptly returned. About Tesoro Corp. Headquartered in San Antonio, Texas, Tesoro Corporation (NYSE: TSO) -- http://www.tsocorp.com/-- is an independent refiner and marketer of petroleum products. Tesoro, through its subsidiaries, operates seven refineries in the western United States with a combined capacity of approximately 660,000 barrels per day. Tesoro's retail-marketing system includes over 890 branded retail stations, of which over 450 are company operated under the Tesoro(R), Shell(R), Mirastar(R) and USA(R) brands. The company dislosed on Nov. 8, 2004, the change of the company's name from Tesoro Petroleum Corp. to Tesoro Corporation, effective immediately. * * * As reported in the Troubled Company Reporter on Oct. 30, 2007, Moody's changed its outlook on Tesoro Corporation's ratings (Ba1 corporate family rating, Ba1 senior unsecured notes rating, and Baa1 senior secured credit facility rating) to developing from positive following Tracinda Corporation's announcement that it is making a cash tender offer for an additional 16% of TSO's outstanding common stock at approximately a 12% premium from the prior closing price. Tracinda Corporation, of which Kirk Kerkorian is the sole shareholder, currently owns about 4% of TSO's outstanding shares. THORPE INSULATION: Taps Pachulski Stang as General Counsel ---------------------------------------------------------- Thorpe Insulation Company asks the U.S. Bankruptcy Court for the Central District of California for authority to hire Pachulski Stang Ziehl & Jones LLP as its general bankruptcy counsel, effective as of Oct. 15, 2007. Pachulski will: a. advise and represent the Debtors in the performance of their duties and exercise their powers under the Bankruptcy Code and Rules, the Local Bankruptcy Rules and the Region 17 United States Trustee Guidelines; b. advise and represent the Debtor concerning the rights and remedies of the estate in regard to the assets of the estate; c. prepare motions, applications, answers, orders, memoranda, reports, and papers, etc., in connection with the administration of the estate; d. protect and preserve the estate by prosecuting and defending actions commenced by or against the Debtor and analyzing, and preparing necessary objections to, proofs of claim filed against the estate; e. conduct examinations of witnesses, claimants, or adverse parties; f. represent the Debtors in any proceeding or hearing in the Court; g. advise and represent the Debtor in the negotiation, formulation, and drafting of any plan of reorganization and disclosure statement; h. advise and represent the Debtor in connection with investigation of potential causes of action against persons or entities, including avoidance actions, and its litigation; and i. render other advice and services as the Debtor may require in connection with its chapter 11 case. The Debtor will pay the firm at its customary hourly rates. The attorneys currently expected to be principally responsible for the Debtor's case effective as of Sept. 1, 2007, are: Professional Hourly Rate ------------ ----------- Jeremy V. Richards, Esq. $695 David M. Bertenthal, Esq. $550 Scotta McFarland, Esq. $495 Malhar M. Pagay, Esq. $450 Patricia Jeffries (Paralegal) $200 Within a year prior to the commencement of the case, the firm received $375,000 retainer from the Debtor, from which the firm deducted $137,391 for prepetition services rendered. To the best of the Debtor's knowledge, neither the firm nor any of its professionals have any interest materially adverse to the interest of the estate. Accordingly, the firm and its partners are "disinterested persons" as that term is defined in Sections 101(14) and 327 of the Bankruptcy Code. The firm can be reached at: Pachulski Stang Ziehl & Jones LLP 10100 Santa Monica Boulevard, 11th Floor Los Angeles, CA 90067 Tel: (3100 277-6910 Fax: (310) 201-0760 http://www.pszjlaw.com/ About Thorpe Insulation Long Beach, California-based Thorpe Insulation Company, formerly Plant Insulation Company, was incorporated in April 10, 1948. It supplied and distributed asbestos thermal insulation in Southern California before about 1972. The company's products included pipe and boiler insulation, asbestos cloth and insulating mud. After 1972, some of Thorpe's operations also involved asbestos and lead abatement, including repairing insulation that contained asbestos at commercial and industrial sites. On or about Dec. 17, 2004, Thorpe's lender, Pacific Funding Group LLC, sold its collateral at a foreclosure sale to Farwest Insulation Consulting owned by Eric and David Fults. Following the foreclosure, Thorpe ceased operation of its business. To date, Thorpe has been subjected to about 12,000 claims and lawsuits related to asbestos. Thorpe filed for chapter 11 protection on Oct. 15, 2007 (Bankr. C.D. Calif. Case No. 07-19271). Jeremy V. Richards, Esq., and Scotta E. McFarland, Esq., at Pachulski, Stang, Ziehl & Jones, LLP, represent the Debtor. When the Debtor filed for protection from its creditors, it disclosed estimated assets and debts of more than $100 million. Los Angeles-based Pacific Insulation Company was incorporated in California by Thorpe on May 23, 2000, to be its wholly owned subsidiary. On Oct. 1, 2000, Pacific transferred 100% of its shares to Thorpe in exchange for Thorpe's materials division assets. Thorpe's sole shareholders and board members, Robert W. Fults and Linda Fults, own 50.1% and 49.9% of Pacific, respectively. Pacific is a southwest commercial and industrial insulation distributor and fabricator with locations in Southern and Northern California, Arizona, and Nevada. It provides pipe, air handling, fire barrier, board and blanket insulation as well as adhesives, mastics and sealants. Pacific has never installed or sold any materials containing asbestos. It currently has 55 full-time employees. Pacific filed for chapter 11 petition on Oct. 31, 2007 (Bankr. C.D. Calif. Case No. 07-20016) due to its alleged asbestos liability and the failure of Thorpe's insurers to pay asbestos claims asserted against Thorpe. John A. Lapinski, Esq., Leslie R. Horowitz, Esq., and Stephen R. Hyam, Esq., at Clark & Trevithick represent Pacific in its restructuring efforts. On Nov. 6, 2007, Pacific's case was jointly administered under Thorpe Insulation's bankruptcy proceeding. THORPE INSULATION: U.S. Trustee Appoints Nine-Member Committee -------------------------------------------------------------- The United States Trustee for Region 16 appointed nine creditors who will serve in the Official Committee of Unsecured Creditors in the bankruptcy case of Thorpe Insulation Company and Pacific Insulation Company. The members of the Committee are: 1. Charlton Clemmer c/o Alan R. Brayton, Esq. Brayton Purcell LLP 222 Rush Landing Road P.O. Box 6169 Navato, CA 94948 2. Victor Medina, Sr. c/o Alan R. Brayton, Esq. Brayton Purcell LLP 222 Rush Landing Road P.O. Box 6169 Navato, CA 94948 3. Susan Lee Snyder c/o David McClain, Esq. Kazan McClain, et al 171 12th Street, Suite 300 Oakland, CA 94607 4. John R. Miller c/o David A. Rosen, Esq. Rose Klein & Marias LLP 801 South Grand Avenue, 11th Floor Los Angeles, CA 90017 5. Paul Krause c/o Jerry Paul, Esq. Paul Hanley & Harley LLP 5716 Corsa Avenue, Suite 203 Westlake Village, CA 91362 6. James M. Baker Peter A. Kraus, Esq. Waters & Kraus 3219 McKinney Avenue Dallas, TX 75204 7. Rachael Staniforth c/o Steve Baron, Esq. Baron & Budd PC 3102 Oak Lawn Avenue, Suite 1100 Dallas, TX 75219 8. Tamara Merrill c/o Ron C. Eddins, Esq. Simon Eddins & Greenstone LLP 3232 McKinney Avenue, Suite 610 Dallas, TX 75204 9. Dan Kwelberg c/o Jerry Paul, Esq. Paul Hanley & Harley LLP 5716 Corsa Avenue, Suite 203 Westlake Village, CA 91362 Caplin & Drysdale, Chartered serves as the National Bankruptcy Counsel of The Official Committee of Unsecured Creditors. Heller Ehrman LLP is the proposed co-counsel to the Committee. Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About Thorpe Insulation Long Beach, California-based Thorpe Insulation Company, formerly Plant Insulation Company, was incorporated in April 10, 1948. It supplied and distributed asbestos thermal insulation in Southern California before about 1972. The company's products included pipe and boiler insulation, asbestos cloth and insulating mud. After 1972, some of Thorpe's operations also involved asbestos and lead abatement, including repairing insulation that contained asbestos at commercial and industrial sites. On or about Dec. 17, 2004, Thorpe's lender, Pacific Funding Group LLC, sold its collateral at a foreclosure sale to Farwest Insulation Consulting owned by Eric and David Fults. Following the foreclosure, Thorpe ceased operation of its business. To date, Thorpe has been subjected to about 12,000 claims and lawsuits related to asbestos. Thorpe filed for chapter 11 protection on Oct. 15, 2007 (Bankr. C.D. Calif. Case No. 07-19271). Jeremy V. Richards, Esq., and Scotta E. McFarland, Esq., at Pachulski, Stang, Ziehl & Jones, LLP, represent the Debtor. When the Debtor filed for protection from its creditors, it disclosed estimated assets and debts of more than $100 million. Los Angeles-based Pacific Insulation Company was incorporated in California by Thorpe on May 23, 2000, to be its wholly owned subsidiary. On Oct. 1, 2000, Pacific transferred 100% of its shares to Thorpe in exchange for Thorpe's materials division assets. Thorpe's sole shareholders and board members, Robert W. Fults and Linda Fults, own 50.1% and 49.9% of Pacific, respectively. Pacific is a southwest commercial and industrial insulation distributor and fabricator with locations in Southern and Northern California, Arizona, and Nevada. It provides pipe, air handling, fire barrier, board and blanket insulation as well as adhesives, mastics and sealants. Pacific has never installed or sold any materials containing asbestos. It currently has 55 full-time employees. Pacific filed for chapter 11 petition on Oct. 31, 2007 (Bankr. C.D. Calif. Case No. 07-20016) due to its alleged asbestos liability and the failure of Thorpe's insurers to pay asbestos claims asserted against Thorpe. John A. Lapinski, Esq., Leslie R. Horowitz, Esq., and Stephen R. Hyam, Esq., at Clark & Trevithick represent Pacific in its restructuring efforts. On Nov. 6, 2007, Pacific's case was jointly administered under Thorpe Insulation's bankruptcy proceeding. THORPE INSULATION: Pacific Taps Clark & Trevithick as Counsel ------------------------------------------------------------- Pacific Insulation Company, party-in-interest of Thorpe Insulation Company, asks the U.S. Bankruptcy Court for the Central District of California for permission to employ Clark & Trevithick as its bankruptcy counsel effective as of Oct. 31, 2007. Clark will: a. advise the Debtor regarding matters of bankruptcy law, including the rights and remedies of the Debtor with regard to assets and with respect to the claims of creditors; b. represent the Debtor in proceedings or hearings in the Court and in any other action where the Debtor's rights under the Bankruptcy Code may be litigated or affected; c. advise and assist the Debtor with respect to compliance with the requirements of the U.S. Trustee; d. assist the Debtor with the negotiation, documentation, and necessary Court approval of transactions disposing of property of the estate; e. advise the Debtor concerning the requirements of the Bankruptcy Code, and federal and local rules relating to the administration of the cases, and the effect of these cases on the operations of the Debtor; f. assist the Debtor in the formation, negotiation, confirmation, and implementation of a chapter 11 plan of reorganization; and g. take other action and perform other services as the Debtor may require of the firm in connection with its chapter 11 case. The Debtor will pay Clark according to these hourly rates: Designation Hourly Rate ----------- ----------- Partner $330 - $525 Associate $255 - $350 Paralegal $140 - $155 The firm's professionals who are expected to be most active in the Debtor's case are: Professional Hourly Rate ----------- ----------- John A. Lapinski, Partner $500 Leslie R. Horowitz, Partner $425 Stephen E. Hyam, Associate $350 Iris C. Palmer, Paralegal $150 Within a year preceeding the Debtor's bankruptcy filing, from Oct. 31, 2006, to Oct. 31, 2007, the firm received payments from the Debtor totaling $231,149 for attorneys' fees, plus $250,000 retainer. As of Oct. 31, 2007, $250,000 retainer remained on deposit as retainer. To the best of the Debtor's knowledge, Clark & Trevithick has no interest materially adverse to the interest of the estate. The firm can be reached at: Clark & Trevithick 800 Wilshire Boulevard, 12th Floor Los Angeles, CA 90017 Tel: (213) 629-5700 Fax: (213) 624-9441 http://www.clarktrev.com/ About Thorpe Insulation Long Beach, California-based Thorpe Insulation Company, formerly Plant Insulation Company, was incorporated in April 10, 1948. It supplied and distributed asbestos thermal insulation in Southern California before about 1972. The company's products included pipe and boiler insulation, asbestos cloth and insulating mud. After 1972, some of Thorpe's operations also involved asbestos and lead abatement, including repairing insulation that contained asbestos at commercial and industrial sites. On or about Dec. 17, 2004, Thorpe's lender, Pacific Funding Group LLC, sold its collateral at a foreclosure sale to Farwest Insulation Consulting owned by Eric and David Fults. Following the foreclosure, Thorpe ceased operation of its business. To date, Thorpe has been subjected to about 12,000 claims and lawsuits related to asbestos. Thorpe filed for chapter 11 protection on Oct. 15, 2007 (Bankr. C.D. Calif. Case No. 07-19271). Jeremy V. Richards, Esq., and Scotta E. McFarland, Esq., at Pachulski, Stang, Ziehl & Jones, LLP, represent the Debtor. When the Debtor filed for protection from its creditors, it disclosed estimated assets and debts of more than $100 million. Los Angeles-based Pacific Insulation Company was incorporated in California by Thorpe on May 23, 2000, to be its wholly owned subsidiary. On Oct. 1, 2000, Pacific transferred 100% of its shares to Thorpe in exchange for Thorpe's materials division assets. Thorpe's sole shareholders and board members, Robert W. Fults and Linda Fults, own 50.1% and 49.9% of Pacific, respectively. Pacific is a southwest commercial and industrial insulation distributor and fabricator with locations in Southern and Northern California, Arizona, and Nevada. It provides pipe, air handling, fire barrier, board and blanket insulation as well as adhesives, mastics and sealants. Pacific has never installed or sold any materials containing asbestos. It currently has 55 full-time employees. Pacific filed for chapter 11 petition on Oct. 31, 2007 (Bankr. C.D. Calif. Case No. 07-20016) due to its alleged asbestos liability and the failure of Thorpe's insurers to pay asbestos claims asserted against Thorpe. John A. Lapinski, Esq., Leslie R. Horowitz, Esq., and Stephen R. Hyam, Esq., at Clark & Trevithick represent Pacific in its restructuring efforts. On Nov. 6, 2007, Pacific's case was jointly administered under Thorpe Insulation's bankruptcy proceeding. TRANSAX INT'L: Sept. 30 Balance Sheet Upside-Down by $3.3 Million ----------------------------------------------------------------- Transax International Limited's consolidated balance sheet at Sept. 30, 2007, showed $2,112,254 in total assets and $5,481,383 in total liabilities, resulting in a $3,369,129 total stockholders' deficit. At Sept. 30, 2007, the company's consolidated balance sheet also showed strained liquidity with $904,785 in total current assets available to pay $5,021,264 in total current liabilities. The company reported a net loss of $59,460 on revenues of $1,328,636 for the third quarter ended Sept. 30, 2007, compared with a net loss of $623,578 on revenues of $1,115,930 in the same period last year. The increase in revenues is due to an increase in installations of the company's software or hardware devices at healthcare providers' locations in Brazil. 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?25d0 Going Concern Doubt Moore Stephens P.C., in New York, expressed substantial doubt about Transax International Limited's ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended Dec. 31, 2006. The auditing firm pointed to the company's accumulated losses from operations, working capital deficiency and net capital deficiency at Dec. 31, 2006. In addition, since fiscal 2000, the company has been deficient in the payment of Brazilian payroll taxes and Social Security taxes. At Sept. 30, 2007, these deficiencies, including interest and fines, amounted to approximately $1,013,000. About Transax International Based in Miami, Florida, Transax International Limited (OTC BB: TNSX.OB) -- http://www.transax.com/-- primarily through its wholly-owned subsidiary, Medlink Conectividade em Saude Ltda. is an international provider of information network solutions specifically designed for healthcare providers and health insurance companies. The company has offices located in Miami, Florida and Rio de Janeiro, Brazil. TRAVELCLICK HOLDINGS: S&P Assigns 'B' Corporate Credit Rating ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Schaumburg, Illinois-based TravelCLICK Holdings Inc., a provider of marketing and inventory distribution solutions primarily to independent hotels. The outlook is positive. At the same time, Standard & Poor's assigned its bank loan and recovery ratings to the company's $105 million senior secured financing. The first-lien facilities, comprised of a $15 million revolving credit facility and a $90 million term loan B, are rated 'B+', with a recovery rating of '2', indicating the expectation for substantial (70%-90%) recovery in the event of a payment default. All ratings are based on preliminary offering statements and are subject to review upon final documentation. Proceeds from the first-lien term loan, totaling $90 million, will be used to partially finance the acquisition of the company by Genstar Capital. "The ratings reflect the company's leveraged post-acquisition financial profile, reliance on its global distribution system relationships, and limited track record of operational performance at current levels," said Standard & Poor's credit analyst Molly Toll-Reed. "These factors are offset partially by moderate barriers to entry and favorable industry dynamics." TREY RESOURCES: Unit Inks LOI to Sell Assets to SWK Solutions ------------------------------------------------------------- Trey Resources Inc.'s subsidiary, SWK Technologies Inc. has entered into a letter of intent to sell the majority of its assets and liabilities to SWK Solutions LLC, a limited liability company formed by Jeffrey D. Roth, CEO of SWK Technologies Inc. and its management team. The transaction is expected to close during the first quarter of 2008. "Trey has grown in a short period of time from a company with no revenue, back in May 2004, to a company which is reporting sales results at a run rate of $7.4 million per year, Mark Meller, CEO of Trey Resources, said. "We have been presented with an opportunity to sell SWK at a significant profit over our investment, and believe it is in the best interest of both the company and SWK's management to sell the company at this time." "While terms of the transaction have not as yet been made public, I can state that Trey will be debt free following the transaction, and will also have significant cash available to it," Mr. Meller added. "Our plan will be to acquire a more substantial company in another high growth industry in the near future. We will immediately begin interviewing investment banks to assist us in this process." "We have a strong team that is committed to growing the company," Jeffrey D. Roth, CEO of SWK Technologies, stated. "We are well positioned in our core geographic markets and see tremendous growth opportunities from new products and services. We look forward to operating as an independent company." About Trey Resources Headquartered in Livingston, New Jersey, Trey Resources Inc. (OTC BB: TYRIA.OB) -- http://www.treyresources.com/-- is an information technology and software company. Through its principal operating subsidiary, SWK Technologies, the company is a value added reseller of Best Software's financial accounting software, including MAS90, MAS200, MAS500, and BusinessWorks. Trey also publishes MAPADOC, its own proprietary electronic data interchange software. In addition, the company provides network service and business consulting services for its clients, which includes providing Sarbanes Oxley (SOX 404) technology audits for public companies. Trey Resources Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $2,282,762 in total assets and $6,294,319 in total liabilities, resulting in a $4,011,557 total shareholders' deficit. Going Concern Doubt As reported in the Troubled Company Reporter on Nov. 21, 2007, Bagell, Josephs, Levine & Company LLC, in Gibbsboro, New Jersey, expressed substantial doubt about Trey Resources Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2006, and 2005. The auditing firm pointed to the company's substantial accumulated deficits and operating losses. TRIBUNE COMPANY: FCC to Decide on Temporary Waiver Today -------------------------------------------------------- Federal Communications Commission Chairman Kevin Martin had proposed to hold a vote today, Nov. 29, 2007, on granting the Tribune Company temporary waivers from the agency's cross-media- ownership rule, Corey Boles of The Wall Street Journal reports. The waivers would allow the company's privatization deal with real-estate magnate Sam Zell to go forward by the end of the year, WSJ relates. Company Statement Tribune Company Chairman, President and Chief Executive Officer Dennis FitzSimons said in a press statement Wednesday that the FCC's proposal, "if approved, will enable Tribune's going private transaction to close by the end of the year." "We are pleased with Chairman Martin's proposal," Mr. FitzSimons said. "This will allow Tribune's local media outlets to continue their commitment to outstanding journalism and service to our readers, viewers, listeners and advertisers." Privatization Deal As reported in the Troubled Company Reporter on Aug. 23, 2007, Tribune Company shareholders have approved the company's going- private transaction with Sam Zell. At the company's special shareholders meeting in Chicago, approximately 97% of the shares voted were cast in favor of the merger. The number of shares voted in favor of the merger represented approximately 65% of the total shares outstanding and entitled to vote at the meeting. In April 2007, Tribune disclosed that the transaction will result in Tribune shareholders receiving $34 per share. Sam Zell supported the transaction with a $315 million investment. Tribune said it has financing commitments from Citigroup, Merrill Lynch and JPMorgan Chase to fund the transactions. In the first stage, Tribune will raise $7.0 billion of new debt of which $4.2 billion will be used to complete the tender offer and the remaining $2.8 billion will be used to refinance existing bank credit facilities. In the second stage, Tribune said it will raise an additional $4.2 billion of debt which will be used to buy all the remaining outstanding shares of the company. About Tribune Company Headquartered in Chicago, Tribune Company (NYSE: TRB) -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting. It reaches more than 80% of U.S. households and is the only media organization with newspapers, television stations and websites in the nation's top three markets. In publishing, Tribune's leading daily newspapers include the Los Angeles Times, Chicago Tribune, Newsday (Long Island, New York), The Sun (Baltimore), South Florida Sun-Sentinel, Orlando Sentinel and Hartford Courant. The company's broadcasting group operates 23 television stations, Superstation WGN on national cable, Chicago's WGN-AM and the Chicago Cubs baseball team. * * * Moody's Investor Services placed Tribune Company's long term family rating and probability of default rating at Ba3 in April 2007. The ratings still hold to date. TRICADIA CDO: S&P Puts 'BB' Rating on Class F Notes Under Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on the class A-X, A-2, B, C, D, E, and F notes issued by Tricadia CDO 2007-8 Ltd. on CreditWatch with negative implications. Tricadia CDO 2007-8 Ltd. is a CDO of CDOs transaction originated in April of 2007 that triggered an event of default (EOD) under section 5.1(h) of its indenture. This section of the indenture specifies an EOD if the ratio calculated by dividing the net outstanding collateral balance by the sum of the aggregate principal amount of the class A and B notes falls below 100%. At the same time, S&P's ratings on ACA ABS CDO 2006-1 Ltd. remain on CreditWatch negative, where they were placed on Oct. 22, 2007. On Nov. 21, 2007, ACA ABS CDO 2006-1 triggered an EOD under section 5.01(h) of the indenture dated Apr. 27, 2006, when its senior class A overcollateralization ratio fell below 100%. When Standard & Poor's receives EOD notices, S&P place all affected note ratings on CreditWatch with negative implications. Ratings Placed on Creditwatch Negative Rating ------ Transaction Class To From ----------- ----- -- ---- Tricadia CDO 2007-8 Ltd. A-X AAA/Watch Neg AAA Tricadia CDO 2007-8 Ltd. A-2 AAA/Watch Neg AAA Tricadia CDO 2007-8 Ltd. B AA/Watch Neg AA Tricadia CDO 2007-8 Ltd. C A/Watch Neg A Tricadia CDO 2007-8 Ltd. D BBB/Watch Neg BBB Tricadia CDO 2007-8 Ltd. E BBB-/Watch Neg BBB- Tricadia CDO 2007-8 Ltd. F BB/Watch Neg BB Ratings Remaining on Creditwatch Negative ACA ABS CDO 2006-1 Ltd. Class Rating ----- ------ A-1LB AA/Watch Neg A-2L BBB/Watch Neg A-3L B+/Watch Neg B-1L B-/Watch Neg Other Outstanding Ratings Transaction Class Rating ----------- ----- ------ ACA ABS CDO 2006-1 Ltd. A-1LA AAA Tricadia CDO 2007-8 Ltd. A-1VF AAA TRUMAN CAPITAL: Moody's Cuts Rating on Two Classes Loan to B3 ------------------------------------------------------------- Moody's Investors Service has downgraded the ratings of five tranches issued in two separate mortgage transactions. The collateral backing each tranche consists primarily of first-lien, fixed- and adjustable-rate scratch and dent mortgage loans. The deals being reviewed have experienced an increasing proportion of severely delinquent loans while the amount of available credit enhancement has been reduced from losses, causing the protection available to the subordinate bonds to be diminished. Complete rating actions are: Issuer: Truman Capital Mortgage Loan Trust 2004-1 -- Cl. M-1, Downgraded to Baa1 from Aa2 -- Cl. M-2, Downgraded to B3 from Baa2 -- Cl. M-3, Downgraded to C from B1 Issuer: Truman Capital Mortgage Loan Trust 2004-2 -- Cl. M-3, Downgraded to Ba2 from Baa1 -- Cl. M-4, Downgraded to B3 from Baa2 TYCO INTERNATIONAL: Receives Notice of Default from Bank of NY -------------------------------------------------------------- In its annual report filed Tuesday with the Securities and Exchange Commission, Tyco International Ltd. said that on Nov. 8, 2007, The Bank of New York, bond holder, delivered to the company a notice of events of default. The notice claims that the actions taken by the company in connection with its separation into three public entities constitute events of default under the indentures. The claims made in the notice of events of default are the same as those alleged by BONY in a litigation filed in the United States District Court for the Southern District of New York in June 2007. The company continues to believe that no default or event of default has occurred. The indentures provide for a 90-day cure period following delivery of the notice of default, after which BONY could declare any outstanding amounts under the indentures immediately due and payable. The company said it would contest the acceleration. Tyco International Group SA, Tyco International Finance SA and Tyco continue to believe that the separation and the proposed supplemental indentures are permitted under the indentures and that no "make-whole" amount is payable. The company intends to vigorously defend the claims of default and believes it will prevail in legal proceedings. The companies said that if it did not have liquidity available to repay the outstanding debt under the 1998 and 2003 indentures under our 364-day bridge facility, an acceleration of the outstanding notes would have permitted a majority of the lenders under each of their bank and letter of credit facilities to demand repayment of amounts outstanding under those facilities, and to terminate their commitments to extend additional credit thereunder. Additional $4 Billion Bridge Loan As a result, on Nov. 27, 2007, the company secured additional firm commitments from certain of its lenders under the bridge facility, providing the company with additional borrowings of up to $4.0 billion to repay such notes. The additional commitments expire on, and any borrowings under the facility would mature on, Nov. 25, 2008. The facility may only be used to repay, settle or otherwise extinguish the amounts required to be paid in connection with the litigation with BONY. As reported in the Troubled Company Reporter on May 18, 2007, on Jan. 13, 2006, Tyco's Board of Directors approved a plan to separate the company into three separate, publicly traded companies -- Tyco Healthcare, Tyco Electronics and a combination of Tyco Fire and Security and Engineered Products and Services. The company intended to accomplish the proposed separation through tax-free stock dividends to Tyco shareholders. Following the proposed separation, Tyco's shareholders will own 100% of the equity in all three companies. On June 4, 2007, The Bank of New York, as indenture trustee under the indentures dated as of June 9, 1998 and Nov. 12, 2003, of TIGSA, a wholly-owned subsidiary of Tyco, commenced an action against TIGSA and Tyco in the U.S. District Court for the Southern District of New York. BONY served an amended complaint on Oct. 18, 2007, which added TIFSA as an additional defendant. As amended, the complaint alleges that the deparation breached the indentures and seeks damages on behalf of noteholders in excess of $4.1 billion. About Tyco Based in Pembroke, Bermuda, Tyco International Ltd. (NYSE: TYC) (BSX: TYC) -- http://www.tyco.com/-- provides vital products and services to customers in four business segments: Electronics, Fire & Security, Healthcare, and Engineered Products & Services. With 2006 revenue of $41 billion, Tyco employs approximately 240,000 people worldwide. UAL CORP: Proposed Amendment Prompts S&P to Hold 'B' Rating ----------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on UAL Corp. and subsidiary United Air Lines Inc. following disclosure of a proposed amendment to United's bank credit agreement that would permit UAL to pursue "shareholder initiatives" (which could include a special dividend or share repurchases) of up to $500 million. The outlook remains stable. "We consider the move evidence of an aggressive financial policy, given UAL's speculative-grade credit quality and the cloudy airline industry outlook," said Standard & Poor's credit analyst Philip Baggaley. UAL has, since emerging from bankruptcy in early 2006, paid down $2.7 billion of debt and improved its operating performance substantially. "Accordingly," said Mr. Baggaley, "our current rating and outlook on UAL and United can accommodate the possible shareholder initiative, even considering a likely near-term decline in earnings and cash flow due to high fuel prices and a slowing U.S. economy." UAL's corporate credit rating reflects United's participation in the price-competitive, cyclical, and capital-intensive airline industry; pricing pressure from low-cost carriers in the U.S. domestic market; and an overall highly leveraged financial profile. These weaknesses are mitigated by United's extensive and well-positioned route system and by reductions in labor costs and financial obligations achieved in bankruptcy reorganization. Chicago-based United is the second-largest U.S. airline, with strong positions in the Midwest and Western U.S. and on trans-Pacific routes and a solid position on trans-Atlantic routes. UAL CORP: Planned Amendment Cues Moody's to Hold B2 Rating ---------------------------------------------------------- Moody's Investors Service affirmed the ratings of UAL Corp. debt - - corporate family rating at B2 -- following the company's announced plans to amend its $2.055 billion bank credit facilities (comprising a term loan facility of $1.8 billion and a revolving credit facility of $255 million) to provide the flexibility to implement up to $500 million of shareholder initiatives. This level of shareholder initiatives would likely be within United's anticipated free cash flow and should still preserve the company's adequate level of liquidity. The outlook remains stable. Nonetheless, Moody's notes that any execution of share repurchase activity or a dividend would represent a change in United's financial policy from the practice of paying down debt and building liquidity since the company emerged from bankruptcy just 20 months ago. Moody's anticipates that any shareholder initiatives, the amount or form of which has yet to be determined, will be implemented over time. A measured approach would allow United the flexibility to modify its actions to the extent the business environment changes. Moody's believes preserving flexibility is particularly important to the company at this time given limited visibility on passenger demand and the high fuel costs, along with renewed pressures for consolidation in the U.S. airline industry. Since emerging from bankruptcy, United has recorded progressively better profitability given its lowered cost structure as well as strong passenger demand. United has used the cash flow to reduce its debt burden; debt (using Moody's standard adjustments) was $17.4 billion as of Sept. 30, 2007, down from $19.3 billion at emergence. The trend of improving credit metrics could be favorable for the ratings, particularly if current strong operating conditions continue. However, the company's proposal to seek an amendment to its credit facility suggests a somewhat more aggressive financial posture amid industry and economic volatility. The shareholder enhancements, when viewed in light of the company's limited forward visibility, could limit United's financial flexibility and slow any positive developments for the ratings. UNIVERSAL GUARDIAN: Inks Merger Term Sheet with Isonics ------------------------------------------------------- Universal Guardian Holdings Inc. entered, on Nov. 16, 2007, into a non-binding term sheet with Isonics Corporation to complete a merger by which Isonics will acquire all of the outstanding shares of Universal Guardian. "Universal Guardian believes that, if completed, this will be a synergistic merger between UG Services and UG Products with Isonics' Protection Plus Security Corporation subsidiary based in New York," Kevin Westcott, president and COO of Universal Guardian, stated. The non-binding term sheet contemplates a tax-free reorganization for the shareholders of Universal Guardian pursuant to which they would receive Isonics common stock with an aggregate value of approximately $10.3 million, with the price of Isonics common stock to be valued at 100% of the 5-day volume weighted average price of Isonics common stock after shareholder approval. Existing Universal Guardian debt holders would receive shares of Isonics convertible preferred stock. The preferred stock is expected to have a conversion price equal to 100% of the 5-day VWAP of Isonics common stock following shareholder approval. The obligations of Isonics and Universal Guardian to complete the transaction are subject to a number of conditions precedent and, therefore, there can be no assurance that Isonics or Universal Guardian will complete the transaction at all or on the same terms contemplated. Among the material conditions precedent are: 1) The parties must execute a definitive merger agreement by Dec. 31, 2007, subject to Isonics' and Universal Guardian's shareholders' approval and approved in advance of such execution by the boards of directors of Isonics and Universal Guardian, otherwise each party will have the right to withdraw from the transaction; 2) Agreement by the holders of the Universal Guardian convertible debentures as described above; 3) Agreement by Isonics' principal debt holder, Y.A. Global Investments L.P. to waive certain existing and prospective defaults under certain Isonics debt instruments for a period of one year from the date of the closing of the merger; 4) The infusion of $4.0 million in financing, which, if equity financing, will be payable or issuable in post- merger Isonics equity; 5) Satisfactory due diligence by the parties; 6) Continued listing of Isonics common stock on the NASDAQ Capital Market through the date of the closing of the merger, otherwise each party will have the right to withdraw from the transaction; 7) Approval of the merger by the shareholders of Universal Guardian and Isonics; 8) Registration by Isonics of all common stock to be granted to the Universal Guardian shareholders prior to the date of the closing of the merger; and 9) Satisfaction of other normal closing conditions such as the continuing accuracy of all representations, warranties, obtaining all necessary consents and approvals, no material adverse changes, and execution of appropriate employment agreements. About Isonics Corporation Based in Golden, Colorado, Isonics Corp. (NasdaqCM: ISON) -- http://www.isonics.com/-- develops, manufactures, and markets various specialty chemicals used in semiconductor devices, medical diagnostics, imaging and therapy, drug development, and energy production. About Universal Guardian Universal Guardian Holdings Inc. (OTC BB: UGHO.OB) -- http://www.UniversalGuardian.com/-- and its subsidiaries provide a comprehensive range of security products, systems, and services designed to mitigate terrorist and security threats worldwide. For the six-month interim period ended June 30, 2007, the company incurred a net loss of $9.8 million and used cash for operating activities of $3.3 million, and had an accumulated deficit of $34.3 million at June 30, 2007. The company now anticipates that it will need to raise approximately $2,000,000 in additional capital to execute its plan of operation as it relates to the growth and profitability of the UG Services Group over the next twelve months. Going Concern Doubt As reported in the Troubled Company Reporter on Aug. 30, 2007, AJ. Robbins PC in Denver, expressed substantial doubt about Universal Guardian Holdings Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended Dec. 31, 2006. The auditing firm reported that the company has experienced recurring losses and negative cash flows from operations and has a capital deficit at Dec. 31, 2006. VICTOR BELLO: Case Summary & 10 Largest Unsecured Creditors ----------------------------------------------------------- Debtors: Victor M. Bello Maridee Bello 68 Carriage Stone Drive Chagrin Falls, OH 44022 Bankruptcy Case No.: 07-18985 Chapter 11 Petition Date: November 27, 2007 Court: Northern District of Ohio (Cleveland) Judge: Arthur I. Harris Debtors' Counsel: Robert J. Fedor, Jr., Esq. Robert J. Fedor, Esq., LLC 2001 Crocker Road Suite 216 Westlake, OH 44145 Tel: (440) 250-9709 Fax: (440) 250-9714 Total Assets: $489,571 Total Debts: $1,034,335 Debtors' list of its 10 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Internal Revenue Service Unpaid Income $390,565 Special Procedures Taxes - 1992, 1993 1240 East Ninth Street 1994, 1995 , 1998 Room 457 2003 Cleveland, OH 44199 Outstanding $216,825 Individual Income Taxes - various years Ohio Department of Taxation Unpaid Income Taxes $47,457 Bankruptcy Division 30 East Broad, 23rd Floor Columbus, OH 43215 Margaret Thomas Personal Loan $47,000 68 Carriage Stone Drive Chagrin Falls, OH 44022 American Express Credit Card $25,520 MBNA America Credit Card $24,334 Jeffrey Kissinger Personal Loan $13,000 Sky Bank Credit Card $7,089 AAA Financial Services Credit Card $5,269 Capital One Credit Card $3,000 Clinic Physicians Services Medical Services $798 WACHOVIA BANK: Moody's Assigns B3 Rating on $5.547 Million Trust ---------------------------------------------------------------- Moody's Investors Service has assigned definitive ratings to securities issued by Wachovia Bank Commercial Mortgage Trust Series 2007-C34. The provisional ratings issued on 10/23/07 have been replaced with these definitive ratings: -- Class Cl. A-1, $18,111,000, rated Aaa -- Class Cl. A-2, $178,441,000, rated Aaa -- Class Cl. A-PB, $48,817,000, rated Aaa -- Class Cl. A-3, $474,091,000, rated Aaa -- Class Cl. A-1A, $316,144,000, rated Aaa -- Class Cl. IO, $1,479,435,064*, rated Aaa -- Class Cl. A-M, $147,944,000, rated Aaa -- Class Cl. A-J, $88,766,000, rated Aaa -- Class Cl. B, $18,493,000, rated Aa1 -- Class Cl. C, $16,643,000, rated Aa2 -- Class Cl. D, $16,644,000, rated Aa3 -- Class Cl. E, $11,096,000, rated A1 -- Class Cl. F, $12,945,000, rated A2 -- Class Cl. G, $16,643,000, rated A3 -- Class Cl. H, $18,493,000, rated Baa1 -- Class Cl. J, $18,493,000, rated Baa2 -- Class Cl. K, $14,795,000, rated Baa3 -- Class Cl. L, $11,095,000, rated Ba1 -- Class Cl. M, $5,548,000, rated Ba2 -- Class Cl. N, $7,397,000, rated Ba3 -- Class Cl. O, $3,699,000, rated B1 -- Class Cl. P, $3,699,000, rated B2 -- Class Cl. Q, $5,547,000, rated B3 * Approximate notional amount WACHOVIA MORTGAGE: Moody's Cuts Rating on Two Classes to Ba1 ------------------------------------------------------------ Moody's Investors Service has downgraded the ratings of 8 tranches from 2 deals issued by Wachovia Mortgage Loan Trust in 2006. The collateral backing these classes consists of primarily first lien, fixed and adjustable-rate, Alt-A mortgage loans. The ratings were downgraded based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. In its analysis Moody's has also applied its published methodology updates to the non delinquent portion of the transaction. Issuer: Wachovia Mortgage Loan Trust, Series 2006-ALT1 -- Cl. M-3, Downgraded to A2, previously A1, -- Cl. M-4, Downgraded to Baa1, previously A2, -- Cl. B-1, Downgraded to Ba1, previously Baa1, -- Cl. B-2, Downgraded to Ba3, previously Baa3. Issuer: Wachovia Mortgage Loan Trust, Series 2006-AMN1 -- Cl. M-6, Downgraded to Baa1, previously A3, -- Cl. B-1, Downgraded to Baa2, previously Baa1, -- Cl. B-2, Downgraded to Baa3, previously Baa2, -- Cl. B-3, Downgraded to Ba1, previously Baa3. WELLS FARGO: Fitch Rates $2.234MM Class B-5 Certificates at B ------------------------------------------------------------- Fitch Ratings has assigned these ratings to Wells Fargo Mortgage Backed Securities mortgage pass-through certificates, series 2007- AR7: -- $1,064,313,100 classes A-1 and A-R 'AAA'; -- $20,661,000 class B-1 'AA'; -- $11,727,000 class B-2 'A'; -- $4,467,000 class B-3 'BBB'; -- $7,817,000 class B-4 'BB'; -- $2,234,000 class B-5 'B'. The 'AAA' rating on the senior certificates reflects the 4.70% subordination provided by the 1.85% class B-1, 1.05% class B-2, 0.40% class B-3, 0.70% privately offered class B-4, 0.20% privately offered class B-5, and 0.50% privately offered class B- 6. The class B-6 is not rated by Fitch. Fitch believes the amount of credit enhancement available will be sufficient to cover credit losses. The ratings also reflect the high quality of the underlying collateral, the integrity of the legal and financial structures, and the servicing capabilities of Wells Fargo Bank, N.A. (WFB; rated 'RPS1' by Fitch). The transaction is secured by a pool of mortgage loans, which consists of fully amortizing, one- to four-family, adjustable-rate mortgage loans that provide for a fixed interest rate during an initial period of approximately five years. Thereafter, the interest rate will adjust on an annual basis. The interest rate of each mortgage loan will adjust to equal the sum of the index and a gross margin. Approximately 88.29% of the mortgage loans are interest-only loans, which require only payments of interest until the month following the first adjustment date. The mortgage loans have an aggregate principal balance of approximately $1,116,803,961 as of the cut-off date (Nov. 1, 2007), an average balance of $508,795 a weighted average remaining term to maturity of 358 months, a weighted average original loan- to-value ratio of 74.49%, and a weighted average coupon of 6.592%. Rate/Term and equity take-out refinances account for 20.77% and 12.57% of the loans, respectively. The weighted average original FICO credit score of the loans is 739. Owner-occupied properties and second homes comprise 85.01% and 8.19% of the loans, respectively. The state that represents the largest geographic concentration is California (42.71%). All other states represent less than 5% of the aggregate pool balance as of the cut-off date. All of the mortgage loans were generally originated in conformity with underwriting standards of WFB. WFB sold the loans to Wells Fargo Asset Securities Corporation, a special purpose corporation, which deposited the loans into the trust. The trust issued the certificates in exchange for the mortgage loans. WFB will act as servicer, master servicer, paying agent, and custodian, and HSBC Bank USA, N.A. will act as trustee. For federal income tax purposes, elections will be made to treat the trust as a real estate mortgage investment conduit. WHERIFY WIRELESS: Sept. 30 Balance Sheet Upside-Down by $13.8 Mil. ------------------------------------------------------------------ Wherify Wireless Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $4.5 million in total assets and $18.3 million in total liabilities, resulting in a $13.8 million total shareholders' deficit. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $3.4 million in total current assets available to pay $18.3 million in total current liabilities. The company reported a net loss of $2.2 million on revenues of $785,583 for the first quarter ended Sept. 30, 2007, compared with a net loss of $15.7 million on revenues of $184,321 in the same period a year ago. Net revenues for the three months ended Sept. 30, 2007, were primarily generated by Wherifone and related products of $744,295 and $41,288 for FACES. Net revenues for three months ended Sept. 30, 2006, included $134,001 of Wherifone product sales and $50,320 of sales related to the FACES products. No derivative gain or loss was recorded in the quarter ended Sept. 30, 2007, compared to a derivative loss of $11.5 million in the 2006 quarter, associated with the secured convertible debentures in March 2006. 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?25d3 Going Concern Doubt Malone & Bailey, PC, in Houston, expressed substantial doubt about Wherify Wireless Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended June 30, 2007. The auditing firm pointed to the company's recurring losses from operations and working capital deficiency. About Wherify Wireless Inc. Based in Redwood Shores, California, Wherify Wireless Inc. (OTC BB: WFYW) -- http://www.wherifywireless.com/-- develops patented wireless location products and services for family safety and business communications. WILLIAM SPURGEON: Case Summary & 14 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: William Hubert Ellis Spurgeon 4760 Sevierville Road Maryville, TN 37804 Bankruptcy Case No.: 07-34063 Chapter 11 Petition Date: November 27, 2007 Court: Eastern District of Tennessee (Knoxville) Debtor's Counsel: Thomas Lynn Tarpy, Esq. Hagood, Tarpy & Cox PLLC Suite 2100, Riverview Tower 900 South Gay Street Knoxville, TN 37902-1537 Tel: (865) 525-7313 Fax: (865) 525-0858 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 14 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Green Bank 209 Doc Norton Road $780,000 c/o Mary D. Miller, Esq. Secured: P.O. Box 26230 $700,000 Knoxville, TN 37912 Cardmember Services Credit Card $6,113 P.O. Box 5250 Carol Stream, IL 60197-9641 Chase Bank Credit Card $4,837 c/o Valentine & Kebartas, Inc. P.O. Box 325 Lawrence, MA 01842-0625 American Express Credit Card $1,971 Discover Card Credit Card $1,414 Sterling Engineering Surveying $1,372 Highland South Funeral Home Funeral $1,318 Amerigas Gas $550 Capital One Bank Credit Card $382 A&A Waste Removal Waste Removal $325 Services Household Bank Credit Card $59 Charles Hutson, M.D. Medical $26 Airgas Gas $13 Knoxville Emergency Medical Services $11 Physicians Group WORKFLOW MANAGEMENT: S&P Places 'B' Rating Under Negative Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings for Workflow Management Inc., including the 'B' corporate credit rating, on CreditWatch with negative implications. "The CreditWatch listing reflects continued weakness in operating performance through the third quarter of fiscal 2007, leading to greater concern about the company's ability to improve cash flows to levels sufficient to cover fixed charges, including increased principal amortization payments in 2008," said Standard & Poor's credit analyst Guido DeAscanis. Trends in operating performance have also resulted in a tighter cushion relative to financial covenants, in particular the company's minimum EBITDA and interest coverage covenants. In resolving the CreditWatch listing, Standard & Poor's will consider the company's near-term business prospects, as well as its options for improving its liquidity position. ZUFFA LLC: Poor Performance Cues S&P's Ratings Downgrades --------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Las Vegas-based Zuffa LLC (dba Ultimate Fighting Championship). The corporate credit rating was lowered to 'BB-' from 'BB'. The rating outlook is negative. The issue-level rating on Zuffa's $350 million senior secured credit facilities was lowered to 'BB-', from 'BB'. The recovery rating on this debt remains at '3', indicating that lenders can expect meaningful (50%-70%) recovery in the event of a payment default. "The downgrade follows the second consecutive quarter of operating performance that was meaningfully below our expectations," said Standard & Poor's credit analyst Guido DeAscanis. While underperformance during the quarter ended June 30, 2007 was driven principally by challenges related to Zuffa's international operations, revenues from the company's domestic pay-per-view events declined during the third quarter of fiscal 2007 at a low- single-digit rate. In particular, the company experienced a meaningful decline in buys during the three-month period for UFC- branded PPV events, as compared to S&P's expectation for continued strong growth. Given Zuffa's reliance on the UFC brand and lower growth prospects internationally, the company's ability to grow its core UFC operations is integral to maintaining the current rating. Based on the company's revised guidance, revenue and cash flow generation is expected to remain weak through the fourth quarter of 2007. The 'BB-' rating reflects Zuffa's revenue and cash flow volatility given its primarily event-driven business model, vulnerability to changing consumer tastes, and relatively short operating history. These risks partly are offset by the company's well-recognized UFC brand, healthy free cash flow conversion, and modest expected debt leverage. Zuffa produces live and taped mixed martial arts content, which is distributed primarily through PPV and cable television. Roughly 75% of revenues are event based and depend largely on the number of PPV buys and, to a lesser extent, tickets sold at the gate for the company's MMA contests. The other 25% of revenues are committed through contractual arrangements with Viacom Inc.'s Spike TV channel (which was extended through 2011) and various sponsors. * Euler Hermes Says Business Bankruptcy Numbers Continue to Rise ---------------------------------------------------------------- The number of U.S. business bankruptcies continues to rise in 2007, as the third quarter filings showed yet another increase in the number of businesses seeking protection from creditors. The increase continues to reflect the business insolvency forecast produced by leading accounts receivable insurer Euler Hermes ACI earlier this year. According to the U.S. Bankruptcy Courts, 7,167 businesses declared bankruptcy in the third quarter of 2007, bringing the total for 2007 to 20,152. The third-quarter figure shows a series of upward trends, including: -- A 7% increase over the second quarter of 2007 -- A 35% year-over-year increase from the second quarter of 2006 -- A 45% increase for the first half of 2007 in comparison to the first half of 2006 -- The number of business bankruptcies through three quarters of 2007 (20,152) now eclipses the total number for 2006 (19,695) The Euler Hermes business failures forecast is projecting a return to 30,000 business bankruptcies in 2007 - a 51% increase over 2006. This follows a spectacular, but one-off, reduction in business failures last year, when the number of corporate insolvencies dropped by 50% due to a 2005 change in U.S. bankruptcy legislation. "Businesses today are facing serious headwinds from a slowing economy and an increase in the cost of doing business,\u201d said Euler Hermes ACI Chief Economist Daniel C. North, who has said that the three most serious economic issues remain the effects of increased energy, raw material, and labor costs; the effects of monetary policy tightening by the Federal Reserve in 2004-2006; and the "decimated\u201d housing market and its effects on consumers and businesses. With business bankruptcy levels increasing, business leaders will need to be more vigilant regarding B-to-B accounts receivable by utilizing accounts receivable management products and services, such as trade credit insurance and third-party commercial collections. About Euler Hermes Headquartered in Owings Mills, Maryland, Euler Hermes ACI -- http://www.eulerhermes.com/usa-- is the U.S. subsidiary of the Euler Hermes Group. In addition Euler Hermes ACI is North America's oldest and largest provider of trade credit insurance and accounts receivable management solutions. Euler Hermes ACI provides receivables management services that includes commercial third party collections, receivables management outsourcing, and international collections. With 5,800 employees in 49 countries, Euler Hermes offers services for the management of B-to-B trade receivables and posted a consolidated turnover of EUR2.01 billion in 2006. Euler Hermes, subsidiary of AGF and a member of the Allianz group, is listed on Euronext Paris. The group and its principal credit insurance subsidiaries are rated AA- by Standard & Poor's. * Steve Hedberg Nominated to American College of Bankruptcy Board ----------------------------------------------------------------- Steve Hedberg, national chair of Perkins Coie's Insolvency practice, and Portland, Oregon managing partner has been nominated by the Board of Regents of the American College of Bankruptcy to become a Fellow of the College. Fellowship into the honorary organization is by invitation only. Mr. Hedberg's induction into the College will take place in March 2008 in Washington, D.C. According to the American College of Bankruptcy, nominees are extended an invitation to join based on a proven record of the highest standards of professionalism and service to the profession. "Steve embodies the traits of professionalism, integrity and leadership and is well deserving of this honor," said Robert Giles, firmwide managing partner. "We are delighted that he has been recognized by his peers to be a Fellow of the College. Steve will be one of only about 650 Fellows in the United States and one of only 12 sitting Fellows in Oregon and Washington." Mr. Hedberg has more than 20 years of experience working with clients to solve complex commercial and economic issues related to insolvent companies. He advises clients seeking cost-effective and creative ways to both resolve insolvency problems and take advantage of opportunities presented in insolvency circumstances. About Perkins Coie Headquartered in Seattle, Washington, Perkins Coie -- http://www.perkinscoie.com/-- offers a full spectrum of legal services. With more than 650 lawyers in 15 offices across the United States and in China, the firm serves great companies ranging in size from start-ups to FORTUNE 100. The firm has international capability through its offices in Beijing and Shanghai. The firm was named to FORTUNE magazine's "100 Best Companies to Work For" in 2003, 2004, 2005, 2006 and 2007. *Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ------------------------------------------------------------ Recent Chapter 11 cases filed with assets and liabilities below $1,000,000: In Re 80 Nassau Corp. Bankr. S.D. N.Y. Case No. 07-13692 Chapter 11 Petition filed November 20, 2007 See http://bankrupt.com/misc/nysb07-13692.pdf In Re 625 9th Corp. Bankr. S.D. N.Y. Case No. 07-13695 Chapter 11 Petition filed November 20, 2007 See http://bankrupt.com/misc/nysb07-13695.pdf In Re MicroLight Research, Inc. Bankr. D. Ariz. Case No. 07-06264 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/azb07-06264.pdf In Re Miller Engineering, Inc. Bankr. S.D. Fla. Case No. 07-20298 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/flsb07-20298.pdf In Re H.&B. Industries, Inc. Bankr. E.D. Mich. Case No. 07-34097 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/mieb07-34097.pdf In Re Dave J. Enterprises, Inc. Bankr. E.D. Mich. Case No. 07-63804 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/mieb07-63804.pdf In Re Chayban Tailors and Cleaners, Inc. Bankr. W.D. N.Y. Case No. 07-04791 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/nywb07-04791.pdf In Re Building Blocks to Learning Coalition, Inc. Bankr. W.D. N.Y. Case No. 07-04792 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/nywb07-04792.pdf In Re V.I.P. Parking, Inc. Bankr. N.D. Calif. Case No. 07-44022 Chapter 11 Petition filed November 21, 2007 Filed as Pro Se In Re Pesa Properties, Inc. Bankr. D.C. Case No. 07-00625 Chapter 11 Petition filed November 21, 2007 Filed as Pro Se In Re Jeffrey Harrison Edwards Bankr. C.D. Calif. Case No. 07-11781 Chapter 11 Petition filed November 21, 2007 Filed as Pro Se In Re Valda Regina Crowder Bankr. D.C. Case No. 07-00626 Chapter 11 Petition filed November 21, 2007 Filed as Pro Se In Re Brendan-Hugh Corp. Bankr. D.C. Case No. 07-00624 Chapter 11 Petition filed November 21, 2007 Filed as Pro Se In Re Two Brothers Management, Inc. Bankr. M.D. Tenn. Case No. 07-08634 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/tnmb07-08634.pdf In Re Original Hideaway Club, Inc. Bankr. N.D. Tex. Case No. 07-35775 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/txnb07-35775.pdf In Re R.&B. Dismantling, Inc. Bankr. S.D. W.Va. Case No. 07-30469 Chapter 11 Petition filed November 21, 2007 See http://bankrupt.com/misc/wvsb07-30469.pdf In Re Team 99, Inc. Bankr. N.D. Calif. Case No. 07-53830 Chapter 11 Petition filed November 22, 2007 See http://bankrupt.com/misc/canb07-53830.pdf In Re Tandem Automotive Group, L.L.C. Bankr. S.D. Fla. Case No. 07-20320 Chapter 11 Petition filed November 22, 2007 See http://bankrupt.com/misc/flsb07-20320.pdf In Re Keene's Trucking & Land Development, Inc. Bankr. M.D. Fla. Case No. 07-11396 Chapter 11 Petition filed November 23, 2007 See http://bankrupt.com/misc/flmb07-11396.pdf In Re T.C.B. Lending Corp. Bankr. S.D. Fla. Case No. 07-20322 Chapter 11 Petition filed November 23, 2007 Filed as Pro Se In Re Acer Appliance, Inc. Bankr. E.D. Penn. Case No. 07-16899 Chapter 11 Petition filed November 25, 2007 See http://bankrupt.com/misc/paeb07-16899.pdf In Re Trappers Creek, L.L.C. Bankr. C.D. Ill. Case No. 07-82646 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/ilcb07-82646.pdf In Re Frank Monopoli Bankr. D. Md. Case No. 07-21895 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/mdb07-21895.pdf In Re Homestyle Farms, L.L.C. Bankr. D. N.J. Case No. 07-27351 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/njb07-27351.pdf In Re Jericho Eatery, L.L.C. Bankr. E.D. N.Y. Case No. 07-74825 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/nyeb07-74825.pdf In Re Harvey C. Taylor Bankr. W.D. Penn. Case No. 07-27423 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/pawb07-27423.pdf In Re John Mandurrago Investment Cos., Inc. Bankr. N.D. Calif. Case No. 07-53834 Chapter 11 Petition filed November 26, 2007 Filed as Pro Se In Re Randall Franklin Chambers Bankr. E.D. Calif. Case No. 07-30041 Chapter 11 Petition filed November 26, 2007 Filed as Pro Se In Re All Brands, Inc. Bankr. E.D. Va. Case No. 07-13605 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/vaeb07-13605.pdf In Re K.&M. Construction Bankr. W.D. Wis. Case No. 07-14663 Chapter 11 Petition filed November 26, 2007 See http://bankrupt.com/misc/wiwb07-14663.pdf In Re Bobby W. Jester Logging, Inc. Bankr. W.D. Ark. Case No. 07-73828 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/akwb07-73828.pdf In Re Living Water Properties, Inc. Bankr. D. Ariz. Case No. 07-06332 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/azb07-06332.pdf In Re Stephan Doody Bankr. D. Maine Case No. 07-21086 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/meb07-21086.pdf In Re Liberty Farm, Inc. Bankr. W.D. Mo. Case No. 07-44215 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/mowb07-44215.pdf In Re Innovative Controls, Inc. Bankr. W.D. Mo. Case No. 07-61741 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/mowb07-61741.pdf In Re 298 Bleeker Corp. Bankr. S.D. N.Y. Case No. 07-13747 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/nysb07-13747.pdf In Re Norma Navarro Bankr. C.D. Calif. Case No. 07-20936 Chapter 11 Petition filed November 27, 2007 Filed as Pro Se In Re Seema Vest, Inc. Bankr. M.D. Fla. Case No. 07-05914 Chapter 11 Petition filed November 27, 2007 Filed as Pro Se In Re M.P.F. Management, L.L.C. Bankr. S.D. Tex. Case No. 07-38055 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/txsb07-38055.pdf In Re Rainier Auto Reconditioning & Accessories, Inc. Bankr. W.D. Wash. Case No. 07-44032 Chapter 11 Petition filed November 27, 2007 See http://bankrupt.com/misc/wawb07-44032.pdf ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, John Paul C. Canonigo, Joseph Medel C. Martirez, Sheena R. Jusay, and Peter A. Chapman, Editors. Copyright 2007. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***