T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, December 11, 2007, Vol. 11, No. 293 Headlines A21 INC: Sept. 30 Balance Sheet Upside-Down by $258,000 ACCREDITED MORTGAGE: Moody's Cuts Rating on Cl. M-9 Loan to Ba3 ADVANCED MARKETING: Third Amended Plan Effective December 4 AES CORP: Somerset Town Seeks Judge's Disqualification in Lawsuit AMERICAN HOME: Asks Feb. 1 Extension for Filing Adversary Action AMERICAN HOME: Can Pay Up to $9 Mil. in Incentives to Sr. Managers AMERICAN HOME: FGIC Wants Stay Lifted to Transfer Servicing Rights AMERICAN RACING: Posts $1,036,525 Net Loss in Third Quarter ANTARES MEZZ: Weaver Hill to Sell Antares Mezz Affiliate on Jan. 3 ASSOCIATES MANUFACTURED: Fitch Retains Junk Rating on Class B-2 ATLANTIC WINE: Posts $92,797 Net Loss in Second Quarter BANCO DEL CARIBE: S&P Cuts Issuer Default Rating to B from B+ BEARINGPOINT: Moody's Confirms B2 Corporate Family Rating BIG A: Taps Lewis R. Landau as Co-General Bankruptcy Counsel BIG A: Selects Steven R. Fox Law Offices as Co-Counsel BREK ENERGY: Posts $265,773 Net Loss in Third Quarter BROOKLYN STRUCTURED: S&P Puts 'BB' Rating Under Negative Watch BROTMAN MEDICAL: Court Gives Final OK to Access $19.8MM Financing C-BASS MORTGAGE: Moody's Downgrades Ratings on 53 Tranches CAM COMMERCIAL: S&P Affirms 'B-' Rating on Class N Certificates CANYON CAPITAL: Case Summary & Two Largest Unsecured Creditors CASTLETON GROUP: Hearing on Appeal vs. N.C. Insurance Set Today CDC MORTGAGE: S&P Assigns Default Rating on Class B Certificates CENTRAL MEMPHIS REGIONAL: Sale of GECC Collateral Set for Dec. 18 CHASE MORTGAGE: Moody's Assigns B2 Rating on Class B-4 Certs. CHASE MORTGAGE: Moody's Assigns Ba2 Rating on Cl. B-3 Certs. CHINA DIGITAL: Posts $72,361 Net Loss in Third Quarter CHRYSLER LLC: Top Spokesman Quits Spurring Corporate Realignment CITIGROUP MORTGAGE: Moody's Lowers Ratings on 52 Tranches CJ KELLEY: Case Summary & 20 Largest Unsecured Creditors CLAYTON HOLDINGS: Poor Performance Cues Moody's to Cut Ratings COILPLUS JACKSON: To Be Put Into Liquidation by Mitsubishi COMPUSA: Acquired by Gordon Brothers; Winds Down Retail Operations CROSS READY: Case Summary & 22 Largest Unsecured Creditors CYGNAL TECH: Canadian Court Extends Stay Period Until January 31 DB KEY: Settlement Plan Sets Philrich as Stalking Horse Bidder DEL LABORATORIES: Coty and Bella Merger Deal Cues Moody's Review DELPHI CORP: Sr. Noteholders Balk at Revised Disclosure Statement DELPHI CORP: Disclosure Statement is Inadequate, Wilmington Says DELPHI CORP: Revised Plan Disregards ERISA Plaintiffs' Concerns EL PASO: Board OKs 25% Shareholders to Call Special Meetings ENERSYS INC: To Sell 5,000,000 Common Shares to Jefferies ENTERCOM COMMS: Rising Debt Leverage Cues S&P to Revise Outlook ENVIROKARE TECH: Sept. 30 Balance Sheet Upside-Down by $1.8 Mil. FAYETTE MRI: To Pay GECC Debt Through December 18 Asset Sale GE COMMERCIAL: S&P Holds Low-B Ratings on Six Cert. Classes GENERAL MOTORS: Canadian Arm to Idle Oshawa Truck Plant in January GENERAL MOTORS: November 2007 Sales in Canada Down 10.2% GENESCO INC: Faces Class Action Suit in Tennessee Dist. Court GOODYEAR TIRE: Forms New Strategic Business Unit GWENDOLYN CHAMBLISS: Case Summary & 12 Largest Unsecured Creditors HELIX ENERGY: S&P Rates $500MM Proposed Fixed-Rate Notes at B+ HEREFORD & HOPS: Voluntary Chapter 11 Case Summary HIGHRIDGE ABS: S&P Puts 'BB' Rating Under Negative Watch HJ HEINZ: Moody's Revises Outlook to Stable from Negative HSI ASSET: Moody's Lowers Ratings on 29 Tranches HURLEY MEDICAL: Moody's Holds Ba1 Rating and Revises Outlook IMAX CORP: Inks Deal with AMC to Install 100 IMAX(R) Systems INGLESIDE GO DEBT: Good Performance Cues S&P's Positive Outlook INGLESIDE WATERWORKS: S&P Revises Outlook to Pos. from Stable INPHOHIC INC: Court Approves DLA Piper as Bankruptcy Counsel INPHOHIC INC: Taps Bayard Firm as Bankruptcy Co-Counsel INPHONIC INC: U.S. Trustee Appoints Five Member Creditors Panel INTERPLAY ENT: Sept. 30 Balance Sheet Upside-Down by $1,810,000 INTREPID TECH: Posts $695,694 Net Loss in 1st Qtr. Ended Sept. 30 J&T TRANSPORTATION: Case Summary & 18 Largest Unsecured Creditors JDJ WILTON: Case Summary & 16 Largest Unsecured Creditors JOHN FRUHMORGEN: Case Summary & Eight Largest Unsecured Creditors JP MORGAN: S&P Assigns Low-B Ratings on Six Certificate Classes KMART FUNDING: Fitch Retains Junk Ratings on $26.5MM Bonds KRISPY KREME: Posts $798,000 Net Loss in Quarter Ended October 28 LEHMAN MORTGAGE: Fitch Downgrades Ratings on $26.7MM Certs. LPATH INC: Posts $4.6 Million Net Loss in Third Quarter MARK IV: S&P Retains 'B' Rating Under Negative CreditWatch MARINER ENERGY: Solid Performance Cues S&P to Lift Rating to B+ MDWERKS INC: Sept. 30 Balance Sheet Upside-Down by $962,602 MECHANICAL PRODUCTS: Lender Selling Assets at December 21 Auction MGM MIRAGE: Board Authorizes 20 Million Common Stock Repurchase MORGAN STANLEY: S&P Cuts Rating on Class A-6 Notes to B- from B+ MORGAN STANLEY: S&P Lowers Rating on Class A-10 Notes to B- from B MORGAN STANLEY: S&P Places Ratings Under Negative CreditWatch MSB OF DESTIN: Section 341(a) Meeting Slated for December 20 MTI GLOBAL: Inks Forbearance Deal with its Principal Lender MUSICLAND HOLDING: Extends Plan Effective Date Until January 31 NABI BIOPHARMA: Completes Sale of Unit to Biotest AG for $185 Mil. NABI BIOPHARMA: Board Approves $65 Mil. Share Repurchase Program NABI BIOPHARMA: $185MM Biotest Sale Cues S&P's Stable Outlook NEMASKET PARTNERS: Case Summary & Six Largest Unsecured Creditors NEPHROS INC: Sept. 30 Balance Sheet Upside-Down by $5.6 Million NEUTRON ENTERPRISES: Posts $2,256,162 Net Loss in Third Quarter NEW ORLEANS REGIONAL: Auctions Asset on Dec. 17 to Pay GECC Debt NEWPAGE CORP: Earns $16 Million in Third Quarter Ended Sept. 30 NEWPAGE CORP: Moody's Rates $1.6 Billion Secured Term Loan at Ba2 NEWPAGE CORP: S&P Rates Proposed $1.6 Billion Term Loan at BB- NEWSTAR TRUST: Fitch Affirms 'BB' Rating on $24.372MM Notes NORTH PARK VILLAGE: Voluntary Chapter 11 Case Summary NORTHWEST AIR: Won't Complete Midwest Acquisition by January 31 OCTANS III: S&P Places Ratings Under Negative CreditWatch PASQUAL CASINO: Greater Revenue Cues S&P to Lift Rating to BB- PATRIOT TAX: Stays Neutral on Peachtree Partners' Tender Offer PETSMART INC: Moody's Withdraws All Ratings for Business Reasons PHARMANET DEVELOPMENT: S&P Holds 'B+' Rating and Revises Outlook PHILIP GIBA: Case Summary & Ten Largest Unsecured Creditors PLAINS EXPORATION: Change of Control Offers for Pogo's Notes End PREMIER PRODUCTS: Case Summary & 19 Largest Unsecured Creditors PYRAMIDS CHILD: Files for Chapter 11 Protection in New York QUALITY DISTRIBUTION: To Offer $50 Mil. of Senior Floating Notes QUALITY DISTRIBUTION: Boasso Funding Cues Moody's to Hold Ratings REAL ESTATE: Submits Schedules of Assets and Liabilities ROADHOUSE GRILL: Wants Unexpired Non-Residential Lease Rejected SAGITTARIUS CDO: Terminated Facility Cues Moody's to Cut Ratings SALANDER-O'REILLY: Sotheby's Withdraws Offer to Auction Art Pieces SALLY HOLDINGS: Moody's Affirms B2 Rating and Changes Outlook SARM: Fitch Lowers Ratings on $149.6 Million Certificates SASCO MORTGAGE: S&P Junks Rating on Class B Certificates SCOTIABANK SUD: Moody's Withdraws All Ratings at Issuer's Request SEAN EUGENE O'CARROLL: Voluntary Chapter 11 Case Summary SEARS ROEBUCK: S&P Cuts Rating on $60.19MM Certs. to BB from BB+ SMART ENERGY: Posts $1,705,949 Net Loss in Third Quarter SOUTHAVEN POWER: Court Extends Plan Filing Period to January 15 SPX CORP: Considers Offering $500 Mil. of Senior Unsecured Notes SPX CORP: Fitch Rates Planned $500MM Sr. Unsecured Notes at BB+ SPX CORP: S&P Rates $500 Million Sr. Unsecured Notes at BB STEWART & STEVENSON: S&P Removes CreditWatch on 'CCC+' Rating STRIKEFORCE TECH: Sept. 30 Balance Sheet Upside-Down by $4,124,507 STRUCTURAL INVESTMENT: Involuntary Chapter 11 Case Summary STRUCTURED ASSET: S&P Junks Rating on Class B-4 Certificates SVI MEDIA INC: Voluntary Chapter 11 Case Summary TECO ENERGY: Completes $405 Million Sale of TECO Transport TECO ENERGY: Extends Expiration Date of Exchange Offers THORPE INSULATION: Seeks Injunctive Relief from Coverage Suit THORPE INSULATION: Three Insurers Wants Ch. 11 Trustee Appointed TITUS RANCH EAST: Case Summary & 12 Largest Unsecured Creditors UAL CORP: Board Approves $250 Million Distribution to Shareholders UAL CORP: Unions Furious Over Payouts UNISYS CORP: Prices Offering of $210 Mil. of 12.5% Senior Notes UNITED AIRLINES: Planned Pay Out Does Not Affect Fitch's Rating US STEEL: Prices $500 Million Offering of 7% Senior Notes UVUMOBILE INC: Sept. 30 Balance Sheet Upside-Down by $2,553,043 VALLEY ADVANCED: To Auction GECC Collateral on December 17 WATERFORD EQUITIES: Ombudsman Taps Schottenstein Zox as Counsel WATERFORD EQUITIES: Taps Houlihan Lokey as Financial Advisor WATERFORD EQUITIES: U.S. Trustee Appoints 9-Member Creditors Panel WILD WEST: Judge Nugent Directs Series of Auction to Begin Today WILLIAMS COMPANIES: S&P Lifts Credit Rating to BBB- from BB+ XM SATELLITE: Still Awaits FCC and DOJ Approval on Sirius Merger * Gordon Brothers Acquires CompUSA & Winds Down Retail Operations * Fitch Expects 2008 Will Be An Anxious Year for Paper Industry * S&P Lowers Ratings on 101 Tranches from 24 US Hybrid CDO * S&P Takes Rating Actions on Various Note Classes * S&P Took Various Rating Actions on Insurance Companies * Large Companies with Insolvent Balance Sheets ********* A21 INC: Sept. 30 Balance Sheet Upside-Down by $258,000 ------------------------------------------------------- a21 Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $30.6 million in total assets, $29.8 million in total liabilities, and $1.1 million in minority interest, resulting in a $258,000 total stockholders' deficit. The company reported a net loss of $1.4 million on total revenue of $5.4 million for the third quarter ended Sept. 30, 2007, compared with a net loss of $1.0 million on total revenue of $5.9 million in the same period in 2006. Total cost of sales for the third quarter of 2007 were $2.2 million, or 40.4% of revenues, compared to 38.4% of revenues for the same prior year period. Third quarter 2007 selling, general, and administrative expenses were reduced by $163,000 compared to the same prior year period through a continued focus on expense reduction. In the third quarter of 2007, the company recognized a $315,000 extraordinary charge for organizational consolidation and restructuring expenses. The third quarter 2007 operating loss was $1.0 million including restructuring expense of $315,000, compared to a loss of $614,000 for the same prior year period. Net loss for the quarter reflects lower revenues and margins along with the extraordinary restructuring charge. At Sept. 30, 2007, the company's cash position was $2.8 million and working capital $2.6 million with no short-term debt obligations. 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?2632 About a21 Inc. Based in Jacksonville, Fla., a21 Inc.(OTC BB: ATWO) -- http://www.a21group.com/-- is a leading online digital content company. Through SuperStock and ArtSelect, a21 delivers high quality images, art framing, and exceptional customer service. ACCREDITED MORTGAGE: Moody's Cuts Rating on Cl. M-9 Loan to Ba3 --------------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 3 tranches from Accredited Mortgage Loan Trust 2007-1. The collateral backing these classes consists of primarily first lien, fixed and adjustable-rate, subprime mortgage loans. In its analysis, Moody's has combined its published methodology updates as of July 13, 2007 to the non delinquent portion of the transactions. Collateral backing these transactions is also experiencing higher than anticipated rates of delinquency, foreclosure, and REO relative to credit enhancement levels. Complete list of Rating Actions: Issuer: Accredited Mortgage Loan Trust 2007-1 -- Cl. M-7, Downgraded to Baa2, previously Baa1, -- Cl. M-8, Downgraded to Ba1, previously Baa2, -- Cl. M-9, Downgraded to Ba3, previously Baa3. ADVANCED MARKETING: Third Amended Plan Effective December 4 ----------------------------------------------------------- Advanced Marketing Services Inc., Publishers Group Incorporated and Publishers Group West Incorporated formally emerged from Chapter 11 upon declaration of the U.S. Bankruptcy Court for the District of Delaware the effectiveness of their Third Amended Joint Plan of Liquidation on Dec. 4, 2007. The Liquidating Plan, which was co-filed by the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases, was confirmed by the Court on November 15, finding that it satisfies all the requirements under Section 1129(a) of the Bankruptcy Code and complies with other applicable provisions. Curtis R. Smith, the newly appointed Plan Administrator pursuant to the Confirmation Order, states that creditors holding claims against the Debtors' estates will be entitled to receive distributions in accordance with the terms of the Plan, to the extent that the claims are allowed. Any request for allowance of Administrative Claims will be filed no later than January 3, 2008, with objections to be filed on or before February 4. In addition, all professional fee requests must be filed and served on the Debtors' counsel for final allowance and reimbursement on or before January 18. Furthermore, any entity asserting a claim against the Debtors' estates arising from the rejection of the entity's executory contract or unexpired lease with the Debtors must file a proof of claim by January 3, to be sent to Epiq Bankruptcy Solutions, LLC, 757 Third Avenue, 3rd Floor, in New York. Unless otherwise ordered by the Court, all Claims arising from the rejection of executory contracts or unexpired leases will be treated as Unsecured Claims against the Reorganized Debtors, as the case may be under the Plan. On the Effective Date, the Creditors Committee will dissolve automatically, and its members will be deemed relieved of all of their prospective duties and obligations in connection with the Reorganized Debtors' cases or the Plan and its implementation. In addition, the Creditors Committee will be reconstituted as the Post-Confirmation Committee, with these members: * Random House, Inc., * Hachette Book Group USA, Inc., * Harper Collins Publishers, * Penguin Group, and * Workman Publishing Co. The bylaws and and the fiduciary duties adopted by the Creditors Committee before the Effective Date will apply to the Post- Confirmation Committee. Also, the new committee will have the right to terminate the Plan Administrator with or without cause and to then appoint a successor Plan Administrator. About Advanced Marketing Based in San Diego, Calif., Advanced Marketing Services, Inc. -- http://www.advmkt.com/-- provides customized merchandising, wholesaling, distribution and publishing services, currently primarily to the book industry. The company has operations in the U.S., Mexico, the United Kingdom and Australia and employs approximately 1,200 people Worldwide. The company and its two affiliates, Publishers Group Incorporated and Publishers Group West Incorporated filed for chapter 11 protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos. 06-11480 through 06-11482). Suzzanne S. Uhland, Esq., Austin K. Barron, Esq., Alexandra B. Feldman, Esq., O'Melveny & Myers, LLP, represent the Debtors as Lead Counsel. Chun I. Jang, Esq., Mark D. Collins, Esq., and Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A., represent the Debtors as Local Counsel. Lowenstein Sandler PC represents the Official Committee of Unsecured Creditors. In schedules filed with the Court, Advanced Marketing disclosed total assets of $213,384,791 and total debts of $216,608,357. Publishers Group West disclosed total assets of $39,699,451 and total debts of $83,272,493. Publishers Group Inc. disclosed zero assets but $41,514,348 in liabilities. On Aug. 24, 2007, the Debtors' exclusive period to file a chapter 11 plan expired. On the same date, the Debtors and Creditors Committee filed a Plan & Disclosure Statement. On September 26, the Court approved the adequacy of the Disclosure Statement explaining the Second Amended Plan. On Nov. 13, 2007, the Debtors filed a Third Amended Plan and that plan was confirmed by the Court on November 15. (Advanced Marketing Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). AES CORP: Somerset Town Seeks Judge's Disqualification in Lawsuit ----------------------------------------------------------------- The Town of Somerset in New York has sought the disqualification of State Supreme Court Justice Richard C. Kloch Sr. from the lawsuits against the AES Corp.'s planned power plant, The Buffalo News reports. According to the paper, Somerset claimed that Judge Kloch made several statements in open court prejudging the result of the cases and "slamming the attorneys for the town." Shoemaker's partner, Robert S. Roberson, signed the motion. It asserts that Judge Kloch made several statements in court during hearings in June 2007 on the tax break that indicated that he had decided how he would rule on the power plant assessment case if he had to do so. The Buffalo News notes that as indicated by a courtroom transcript, Judge Kloch said on June 11, 2007, "Only one person really knows the value, and that's myself, and that's without the benefit of hearing all the proof." The judge also admitted, "I have a recurring nightmare, and the nightmare is that I have to, in fact, try these [assessment] proceedings." The Buffalo News says that the motion also claims that Judge Kloch made critical comments about Mr. Roberson and Shoemaker in court. The complainants commented to the Buffalo News, "Various actions and statements of Justice Kloch . . . were improper, establish actual impropriety as well as create the appearance of impropriety on behalf of Justice Kloch, [and] establish bias on the part of Justice Kloch toward the town and its attorneys." The report says that the motion demanding that Judge Kloch remove himself from the assessment cases would be heard before him on Jan. 24, 2007. Town Attorney Edwin J. Shoemaker told the Buffalo News that he is positive the complainants will win the appeal on the tax break case. The motion was "obviously without foundation, and highly ironic, because Judge Kloch has ruled against AES in every instance [in the assessment cases]," the Buffalo News says, citing Mark McNamara, the attorney for AES. Judge Kloch was citing other cases. "Since when does looking at legal precedent rise to the level of bias?" Mr. McNamara commented to the Buffalo News. The assessment suits were dismissed but could be reinstated once the town and the Barker Central School District succeed in their appeals on Judge Kloch's ruling that a tax break for the AES plant was legal, the Buffalo News states. AES Corporation -- http://www.aes.com/-- a global power company, operates in South America, Europe, Africa, Asia and the Caribbean countries. Generating 44,000 megawatts of electricity through 124 power facilities, the company delivers electricity through 15 distribution companies. AES has been in Eastern Europe for over ten years, since it acquired three power plants in Hungary in 1996. Currently, AES has two distribution companies in Ukraine, which serve 1.2 million customers and generation plants in the Czech Republic and Hungary. AES is also the leading company in biomass conversion in Hungary, generating 37% of the nation's total renewable generation in 2004. * * * As reported in the Troubled Company Reporter on Nov. 21, 2007, the AES Corp. (AES: B1 Corporate Family Rating) has completed its previously announced offer to purchase up to $1.24 billion of outstanding senior notes. While no ratings changed as a result, the LGD point estimate on its senior secured credit facilities were revised to LGD 1, 2%, from LGD 1, 3%, its second priority secured notes to LGD 3, 38% from LGD 3, 41% and its senior unsecured notes to LGD 4, 53% from LGD 4, 57%. AMERICAN HOME: Asks Feb. 1 Extension for Filing Adversary Action ---------------------------------------------------------------- American Home Mortgage Investment Corp., its debtor-affiliates, the Official Committee of Unsecured Creditors, and Bank of America, N.A., as administrative agent, have agreed to extend until Feb. 1, 2008, the deadline for the Creditors Committee to properly file an adversary proceeding or contested matter: -- challenging the amount, validity, enforceability, priority or extent of indebtedness or the prepetition secured parties' security interests in and liens upon the prepetition collateral; or -- asserting any claims or causes of action against the Prepetition Secured Parties on behalf of the Debtors' bankruptcy estates. BofA was the lead arranger and swingline lender of a prepetition financing for the Debtors. The Debtors' outstanding obligations under the subfacilities as of bankruptcy filing are: Warehouse Facility $608,300,000 Swingline Credit Facility - Working Capital Facility $50,000,000 Servicing Facility $446,250,000 ---------------- TOTAL $1,104,550,000 The Debtor had obtained authority from the U.S. Bankruptcy Court for the District of Delaware to use, on a final basis, the cash collateral securing the prepetition obligation until Nov. 16, 2007. BofA is represented in the Debtors' cases by Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP, in New York; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, in Wilmington, Delaware. Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors has selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on Dec. 21, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: Can Pay Up to $9 Mil. in Incentives to Sr. Managers ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware has approved American Home Mortgage Investment Corp. and its debtor- affiliates' request to pay up to $9,000,000 in incentives to members of senior management. Under the executive incentive plan, the Debtors will give bonuses to 27 executives, senior vice presidents, and vice presidents if certain thresholds are met. The Debtors will contribute to a plan pool in the event at least one of these objectives are achieved: -- net proceeds from asset sales exceed $230,000,000; -- a plan of liquidation of the Debtors is confirmed on or before August 6, 2008; -- a sale of American Home Bank is consummated on or before February 28, 2007; and -- wind-down costs are less than $45,00,000. However, Judge Sontchi denied the request to withhold the names of senior managers and the bonuses they are entitled to. The exhibit containing the Plan participants' information discloses that the Debtors' chief financial officer, Stephen Hozie, will have a share of 12.65% of the minimum plan pool, which is equivalent to $461,650. Robert Johnson, the secondary markets executive, will get 6.77% amounting to $247,100. Michael Strauss, American Home's founder and chief executive, bypassed the bonus pool. The other Plan participants, whose shares were not disclosed, are: Name Designation ---- ----------- Cavaco, Christopher Chief information Officer Friedman, David EVP, Servicing Hall, David Construction Lending Risk Manager Horn, Alan General Counsel Kwaschyn, Dena Operations Loeffler, Richard Chief Administrative Officer Bernstein, Robert Controller Dickman, Steven SVP, Loan Administration Gonzalez, Carlos SVP, System & Network Gowins, Karen SVP, Dir. of Construction Lending Iorizzo, Robert SVP, System & Network Kalas, John Deputy General Counsel/Chief Compliance Officer Labuskes, Michael SVP, Mortgage Securitization Officer Larsen, Linda SVP, Correspondent Operations Munson, MaryAnn SVP, Director of Human Resources Neer, Tim SVP, Post Closing Operations Newsham, Michele SVP, Wholesale Operations Pino, Craig Chief Investment Officer & Treasurer Sakamoto, Simon Senior Portfolio Manager Trepanier, Thomas SVP, Director of Corp. Real Estate Voulo, Damian SVP, Capital Markets Risk Management Yeckley, Robert SVP, Retail Operations Jannotte, Robert VP, Strategic Initiatives Morelle, Marissa Senior Counsel Parrinelli, Nicholas Deputy Controller Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors has selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on Dec. 21, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: FGIC Wants Stay Lifted to Transfer Servicing Rights ------------------------------------------------------------------ Financial Guaranty Insurance Company asks the U.S. Bankruptcy Court for the District of Delaware to modify the automatic stay to permit the termination and transition of the rights and responsibilities of American Home Mortgage Servicing Inc. and American Home Mortgage Acceptance Inc. as servicers and subservicer under certain home equity line of credit servicing agreements. Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware, contends that FGIC is entitled to relief because, among other reasons: -- after the Debtors sell their mortgage loan servicing business to AH Mortgage Acquisition Co., Inc., the Debtors will have neither a source of funding nor the operational ability to service the HELOC mortgage loans under the HELOC Servicing Agreements; -- there is insufficient time for the Debtors to request any assumption or other transfer of the HELOC Servicing Agreements by separate request, while protecting the rights and interests of FGIC; and -- continuing defaults exist under the HELOC Servicing Agreements and the servicing quality of AHM Servicing and AHM Acceptance has deteriorated and continues to deteriorate, to the direct economic detriment of FGIC and the non-debtor parties to the HELOC Servicing Agreements. Although certain financing has allowed the Debtors to continue their Servicing Business, they do not have financing to support the servicing of the HELOC Mortgage Loans, Mr. Dehney points out. He says that the harm to FGIC and the Non-Debtor Parties in continuing the automatic stay outweighs any harm that may be suffered by the Debtors if the stay is lifted. Thus, FGIC asks the Court to: -- modify the automatic stay to permit FGIC and the Non-Debtor Parties to take all actions necessary to terminate AHM Servicing and AHM Acceptance as servicers and subservicer of the HELOC Mortgage Loans; and -- direct AHM Servicing, AHM Acceptance and the Debtors to: * transfer to GMAC Mortgage, LLC, all documents, files, records and data related to the HELOC Mortgage Loans; * cooperate in connection with transitioning the servicing function to GMAC, including sending "goodbye" letters to borrowers, directing all future collections to GMAC; * provide an accounting of all amounts collected on account of the HELOC Mortgage Loans; * pay all costs and expenses related to the transition of the servicing to GMAC; and * comply with the HELOC Servicing Agreements in transitioning the servicing of the HELOC Mortgage Loans. Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors has selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on Dec. 21, 2007. (American Home Bankruptcy News, Issue No. 14, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN RACING: Posts $1,036,525 Net Loss in Third Quarter ----------------------------------------------------------- American Racing Capital Inc. reported a net loss of $1,036,525 on sales of $277,621 for the third quarter ended Sept. 30, 2007, compared with a net loss of $6,161,217 on sales of $5,375 in the same period in 2006. The company disposed of its ownership of Davy Jones Motorsports Inc. and Fast One Inc. on Oct. 1, 2006, while it acquired a controlling interest in LJJ in June of 2007. Beginning with July 1, 2007, the company consolidates its investment in LJ&J accordingly its revenues are now recognized in the financial statements. Operating expenses for the three months ended Sept. 30, 2007, were $573,287, as compared to $6,084,648, for the three months ended Sept. 30, 2006, a decrease of $5,511,361 or 91%. The decrease is primarily attributable to the company reducing the number of shares of its common stock issued for services. At Sept. 30, 2007, the company's consolidated balance sheet showed $2,406,345 in total assets, $2,344,364 in total liabilities, and $61,981 in total stockholders' equity. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $128,440 in total current assets available to pay $2,344,364 in total current liabilities. 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?2638 Going Concern Doubt Moore & Associates, Chartered, in Las Vegas, expressed substantial doubt about American Racing Capital Inc.'s ability to continue as a going concern after completing its audit of the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's lack of operations and sources of revenues. About American Racing Based in San Diego, American Racing Capital Inc. (OTC BB: AMRA) -- http://www.americanracingcapital.com/-- is a holding company for other companies within the Auto Racing industry. ARC is primarily focused on racetrack property acquisitions and the upgrading of those facilities. ANTARES MEZZ: Weaver Hill to Sell Antares Mezz Affiliate on Jan. 3 ------------------------------------------------------------------ Weaver Hill Acquisition LLC, a secured creditor of Antares Mezz SPE LLC, will offer for sale all rights, title and interest of affiliate Antares Mezz II SPE, LLC on Jan. 3, 2008, at 11:00 a.m., in a public auction at the offices of Weil, Gotshal and Manges LLP, 767 Fifth Avenue, 25th Floor, New York City. Together with the 100% membership interests, Weaver Hill will sell all of the other pledged collateral, as defined in a February 2006 pledge agreement between the Debtors and Lehman Brothers Holdings Inc., and assigned to Weaver Hill. Pursuant to the pledge agreement, Weaver Hill was granted a security interest in the membership interests to secure certain indebtedness of the company. Events of default have occurred under the pledge agreement, and the indebtedness is due and payable in full. A bid deposit of $100,000 in the form of a cashier's check or certified check or other immediately available funds payable to Weaver Hill will be required in order to bid. The membership interests will be offered as a single asset at the auction. ASSOCIATES MANUFACTURED: Fitch Retains Junk Rating on Class B-2 --------------------------------------------------------------- Fitch Ratings has taken rating actions on these four Associates Manufactured Housing Contract Trust pass-through certificates: Series 1996-1: -- Class M affirmed at 'AA+'; -- Class B-1 downgraded to 'AA' from 'AA+'; -- Class B-2 downgraded to 'AA' from 'AA+'. Series 1996-2: -- Class M affirmed at 'AA+'; -- Class B-1 affirmed at 'BBB'; -- Class B-2 remains at 'CC/DR3'. Series 1997-1: -- Class M affirmed at 'AA+'; -- Class B-1 downgraded to 'AA' from 'AA+'; -- Class B-2 downgraded to 'AA' from 'AA+'. Series 1997-2: -- Class A-6 affirmed at 'AAA'; -- Class M affirmed at 'AA'; -- Class B-1 downgraded to 'AA' from 'AA+'; -- Class B-2 downgraded to 'AA' from 'AA+'. The affirmations, affecting approximately $169.3 million of the outstanding certificates, reflect a stable relationship between credit enhancement and expected loss. The ratings on classes B-1 and B-2 of series 1996-1, 1997-1, and 1997-2 are based on a limited guarantee from Associates First Capital Corporation, which completed a merger with Citigroup, Inc. in November of 2000. The downgrades of the limited guarantee bonds, affecting approximately $152 million of the outstanding certificates, reflect Fitch's downgrade of Citigroup's corporate rating to 'AA' on Nov. 5, 2007. The collateral supporting the above transactions consists of fixed-rate contracts secured by manufactured homes. All of the contracts were either originated or purchased by Associates and were originally serviced by Associates. In addition, all of the above transactions are structured to pay interest to the subordinate classes before paying principal to the senior classes. As of the November remittance date, the respective pool factors for series 1996-1, 1996-2, 1997-1, and 1997-2 are 14%, 12%, 14%, and 21% and the respective seasoning is 134, 132, 127, and 121 months. The respective cumulative losses (as a percent of the original collateral balances) for series 1996-1, 1996-2, 1997-1, and 1997-2 are 12.8%, 10.7%, 12.2%, and 18.1%. ATLANTIC WINE: Posts $92,797 Net Loss in Second Quarter ------------------------------------------------------- Atlantic Wine Agencies Inc. reported a net loss of $92,797 on net sales of $68,393 for the second quarter ended Sept. 30, 2007, compared with a net loss of $142,758 on net sales of $44,640 in the same period last year. Operating costs for the three-months ended Sept. 30, 2007, aggregated $166,024 as compared to $187,091 for the three-months ended Sept. 30, 2006. At Sept. 30, 2007, the company's consolidated balance sheet showed $2,824,715 in total assets, $2,415,240 in total liabilities, and $409,475 in total stockholders' equity. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $217,387 in total current assets available to pay $2,415,240 in total current liabilities. 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?263a Going Concern Doubt Meyler & Company LLC, in Middletown, N.J., expressed substantial doubt about Atlantic Wine Agencies Inc.'s ability to continue as a going concern after auditng the company's consolidated financial statements for the years ended March 31, 2007, and 2006. The auditing fir reported that the company has incurred cumulative losses of $7,749,230 since inception, has negative working capital of $1,912,728, and there are existing uncertain conditions the company faces relative to its ability to obtain capital and operate successfully. About Atlantic Wine Based in Somerset West, South Africa, Atlantic Wine Agencies Inc. (OTC BB: AWNA.OB) -- http://www.atlanticwineagencies.com/-- was incorporated in the State of Florida as New England Acquisitions Inc. on April 8, 2001. On Jan. 13, 2004, the company changed its name to Atlantic Wine Agencies. The company through its two wholly owned subsidiaries, Mount Rozier Estates (Pty) Limited and Mount Rozier Properties (Pty) Limited, owns a vineyard in the Stellenbosch region of Western Cape, South Africa. The vineyard and surrounding properties consist of 80.9 hectares of arable land for viticultural as well as residential and commercial purposes. BANCO DEL CARIBE: S&P Cuts Issuer Default Rating to B from B+ ------------------------------------------------------------- Fitch Ratings has downgraded Banco del Caribe's long-term Issuer Default Rating, Individual rating and national rating as: -- Long-term foreign currency IDR to 'B' from 'B+'; -- Long-term local currency IDR to 'B' from 'B+'; -- Individual to 'D/E' from 'D'; -- National long-term to 'A-(ven)' from 'A+(ven)'; -- National short-term to 'F-2(ven)' from 'F-1(ven)'. Fitch has also affirmed the following ratings: -- Short-term Issuer 'B'; -- Short-term local currency rating 'B'; -- Support '5'; -- Support Floor 'NF'. The Rating Outlook is Negative. The downgrade of Bancaribe's IDR, Individual and national ratings reflect the sustained decrease of its capitalization ration due the strong growth achieved in the last 18 months, while profitability levels are undermined by fierce competition and a complex array of controls imposed by the government that limits the bank ability to manage its business, a situation that affects the rest of the system as well. Also, the ratings still incorporate its strong competitive position in the middle market, improved asset quality and adequate income diversification. Downside risk for Bancaribe's ratings would stem from additional government measures that could negatively affect its performance or a more severe decrease in the bank's capitalization ratios. The loan portfolio has increased significantly due to strong loan demand since 2004 and a strategy to expand Bancaribe's participation in the growing consumer loans market. Meanwhile, the improved economic environment and the overhaul of its risk control techniques have strengthened the bank's asset quality metrics. At end-June 2007, the past due loans-to-gross loan ratio stood at 0.5%; however, the rapid growth in loans has resulted in a somewhat tight overall reserves ratio (2% of total loans at the same date). Despite the increased loan portfolio, the bank still holds a significant concentration in government securities, with 4.3 times equity at end-June 2007, 1.2x excluding short-term central bank securities. The lack of foreign exchange gains since 2004, narrower spreads and the increase in loan loss provisions have more than offset the advances in terms of overhead and income diversification, reducing the bank's profitability. At end-June 2007, the bank's return on average assets declined to 2.7%. More modest asset growth and continued pressure on the bank's spreads could further affect Bancaribe's returns. Strong asset growth and still relatively high cash dividends have reduced capital ratios, with the equity-to-asset ratio falling from almost 11% at end-2005 to 8.3% at end-June 2007, while the risk-weighted capital ratio felt to a tight 12%, just in line with the current regulatory minimum. Despite the fact these ratios are similar to the system's average; Bancaribe's above-average holding of fixed assets and investments in subsidiaries significantly reduces the bank's free capital ratio to 3.2%. Given the still- expected increase in lending and the diminished capitalization of the bank, Fitch expects a more conservative capitalization policy in order enhance the financial profile of the bank and mostly considering the inherent volatility of the operating environment. Bancaribe is a medium-sized bank with a 3.3% market share in terms of invested funds at June 2007. At end-2006, 51.1% of Bancaribe was controlled by the Dao family and 26.6% was held by Scotia International Ltd., a wholly owned subsidiary of Scotiabank, with the remainder publicly held. BEARINGPOINT: Moody's Confirms B2 Corporate Family Rating --------------------------------------------------------- Moody's confirmed BearingPoint's B2 corporate family rating and assigned a negative rating outlook. In doing so, Moody's has concluded its review for possible downgrade of the company's ratings. The B2 rating confirmation is supported by the likelihood that, irrespective of a potential further slowdown in the U.S. economy, the company's Public Services, EMEA, and Asia Pacific divisions will continue to provide support for the company's overall revenue growth and achievement of operating profitability. The confirmation also reflects the likelihood that the company will continue reduce its high finance, accounting, and infrastructure costs, raise staff utilization levels, and lower capital expenditures, thereby improving its overall financial operating performance. On Dec. 3, 2007, the company reestablished and expects to maintain current financial reporting status. The corporate family rating is constrained by the company's large operating losses and negative free cash flow, the project consulting industry's exposure to economic cyclicality, including the current downturn in the U.S. financial services sector, the company's high, but declining, finance and accounting costs, and its near-term potential debt refinancing needs related to an April 2009 investor put option on $200 million convertible bonds. The negative rating outlook reflects the company's exposure to economic cyclicality and the potential that a more severe U.S. economic downturn could offset substantial near-term improvement to its financial performance. In addition to the rating confirmation, Moody's assigned a short- term SGL-3 liquidity rating to the company that reflects substantial negative free cash flow in the trailing twelve months ended September 30, 2007, prospects for achieving positive free cash flow over the next twelve months, and a heavy reliance on cash balances and on previously obtained external sources of financing. The company has a $500 million credit facility ($300 million drawn term loan and $200 LOC facility) and is in compliance with the covenants of this facility. The covenants require the company to file its financial statements with the SEC on a timely basis subsequent to Oct. 31, 2008. As of Sept. 25, 2007, cash balances were $431 million. BearingPoint fortified its cash balances in May 2007 with $300 million proceeds from its term loan offering. Potential near-term liquidity needs include potential debt refinancing needs related to an Apr. 15, 2009 investor put option date on its 5% $200 million senior subordinated convertible notes. The Caa1 rating for the Series A and B Unsecured Subordinated Convertible Notes reflects their un-guaranteed and junior position as holding company instruments within the company's capital structure. These notes are subordinate to the $300 million secured term loan, issued May 2007, the $200 million 5.0% senior subordinated convertible notes, as well as to other operating liabilities considered to be senior in priority of claims, including its trade payables, operating leases, and under-funded German pension program. The ratings for these A and B Notes has been downgraded to Caa1 from B3, reflecting the addition of the senior secured term loan into the company's capital structure since the initiation of the review for possible downgrade. Rating Confirmed: -- Corporate Family Rating B2 Ratings Assigned: -- Short-Term Liquidity Rating SGL-3 Ratings Downgraded: -- $250 million Series A Subordinated Convertible Notes to Caa1 from B3 (LGD5, 86%) -- $200 million Series B Subordinated Convertible Notes to Caa1 from B3 (LGD5, 86%) Headquartered in Mclean, Virginia, with approximately $3.4 billion in revenues for the twelve months ended September 2007, BearingPoint, Inc. provides I/T consulting and managed services to commercial and governmental entities worldwide. BIG A: Taps Lewis R. Landau as Co-General Bankruptcy Counsel ------------------------------------------------------------ Big A Drug Stores Inc. asks the United States Bankruptcy Court for the Central District of California for authority to employ Lewis R. Landau, Esq., as its co-general bankruptcy counsel. The Debtor selected Mr. Landau on the recommendation of Steven R. Fox, the Debtor's proposed lead counsel, and because of Mr. Landau's experience, competency and qualifications having served as a commercial bankruptcy attorney for the last 19 years. As co-general bankruptcy counsel, Mr. Landau's services will include all legal services pertaining to the Debtor's bankruptcy case including all contested matters but excluding corporate, tax and securities related services. As compensation for his services, Mr. Landau charges $350 per hour, to increase to $375 per hour effective Jan. 1, 2008. Paralegal hourly rates are $125, increasing to $140 per hour effective July 1, 2008. On Sept. 24, 2007, Mr. Landau received $3,500 from the Debtor's retainer held by Steven R. Fox for general consultation and assistance services, which was fully consumed prior to bankruptcy filing. On Nov. 18, 2007, Mr. Landau received $11,550 from the Debtor's retainer held by Steven R. Fox as full payment of pre- petition services rendered to the Debtor. Mr. Landau assures the Court that he neither represents nor holds any interest adverse to the Debtor or the Debtor's estates, and that he is a "disinterested person" as such term is defined in Sec. 101(14) of the Bankruptcy Code. Headquartered in South Gate, California, Big A Drug Stores Inc. -- http://www.bigadrug.com/-- operates a chain of 21 retail drug stores, located throughout California. The company's stores offer full service pharmacies and over-the-counter drugs, cigarettes, optical products, liquor, general merchandise, groceries, beer and wine, and beverages. The company filed for Chapter 11 protection on Nov. 19, 2007 (Bankr. C.D. Calif. Case No. 07-20699). Steven R. Fox, Esq., of Encino, California, is the Debtor's proposed lead counsel. As of Nov. 18, 2007, the Debtor listed total assets of $18,788,648 and total debts of $54,424,646. BIG A: Selects Steven R. Fox Law Offices as Co-Counsel ------------------------------------------------------ Big A Drugstores Inc. asks the United States Bankruptcy Court for the Central District of California for authority to employ the Law Offices of Steven R. Fox as its bankruptcy co-counsel. The Debtor selected the Law Offices of Mr. Fox because of the firm's familiarity with bankruptcy practice and the provisions of the Bankruptcy Code, as well as extensive experience in chapter 11 bankruptcy cases. The firm is expected to: a) advise the Debtor with respect to its powers and duties as a Debtor-in-Possession and the continued operation of the business and the management of the property in this Chapter case and to assist the Debtor in performing the duties required of it as a Debtor-in-Possession; b) negotiate, formulate, draft, and confirm a Plan of Reorganization and to attend hearings before the Court in connection with any proposed disclosure statements and plans of reorganization, and, then and there, to conduct, if necessary, examinations of interested parties and to advise the Debtor in connection with any proposed plan of reorganization or any proposal made in connection with a plan of reorganization; c) examine all claims filed in these proceedings in order to determine their nature, extent, validity and priority; d) advise and assist the Debtor in connection with the collection of assets, the sale of assets, or the refinancing of same in order to implement any plan of reorganization which might be confirmed in these proceedings; e) take such actions as may be necessary to protect the properties of the estate from seizure or other proceedings, pending confirmation and consummationof the Plan of Reorganization in this case; f) advise the Debtor with respect to the rejectionor affirmation of executory contracts; g) advise and assist the Debtor in fulfilling its obligations as a fiduciary of the chapter 11 estate; h) prepare all necessary pleadings pertaining to matters of bankruptcy law before the Court; i) advise Debtor on a limited basis with respect to tax obligations, and their payment; j) prepare such obligations and reports as are necessary and for which the services of an attorney are required including responding to the compliance requirements of the U.S. Trustee; and k) render other legal services for the Debtor for which the services of a bankruptcy attorney may be necessary during the pendency of this case including any necessary litigation. As compensation for their services, the firm's professionals engaged in this case bill: Designation Hourly Rate ----------- ----------- Principal $350 Associate $350 Law Clerk/Paralegal $125 Prior to Nov. 19, 2007, the Debtor paid $248,961 to the law firm and the Debtor's principal, Edward J. Dallal, paid $76,000 to the law firm. Prior to bankruptcy filing, the Law Offices of Steven R. Fox incurred fees and costs amounting to $401,753.81 leaving the sum of $224,246.19 on hand in the client trust account at the time of bankruptcy filing. The fees incurred prior to Nov. 19, 2007, includes monies paid to Mr. Lewis Landau, the Debtors' proposed co-counsel, for services rendered to the Debtor prior to bankruptcy. Mr. Fox assures the Court that his firm neither represents nor holds any interest adverse to the Debtor or the Debtors' estate, and that his firm is a "disinterested person" as such term is defined in Sec. 101(14) of the Bankruptcy Code. Headquartered in South Gate, California, Big A Drug Stores Inc. -- http://www.bigadrug.com/-- operates a chain of 21 retail drug stores, located throughout California. The company's stores offer full service pharmacies and over-the-counter drugs, cigarettes, optical products, liquor, general merchandise, groceries, beer and wine, and beverages. The company filed for Chapter 11 protection on Nov. 19, 2007 (Bankr. C.D. Calif. Case No. 07-20699). As of Nov. 18, 2007, the Debtor listed total assets of $18,788,648 and total debts of $54,424,646. BREK ENERGY: Posts $265,773 Net Loss in Third Quarter ----------------------------------------------------- Brek Energy Corp. reported a net loss of $265,773 on revenue of $45,145 for the third quarter ended Sept. 30, 2007, compared with a net loss of $229,161 on revenue of $83,242 for the third quarter ended Sept. 30, 2006. The increase in net loss was primarily due to a decrease in revenue and an increase in, gathering expenses primarily offset by decreases in administrative and professional fees. The $38,097 decrease in revenue for the three months ended Sept. 30, 2007, was due to reduced production. At Sept. 30, 2007, the company's consolidated balance sheet showed $2,228,570 in total assets, $472,754 in total liabilities, $38,995 in minority interest, and $1,716,821 in total stockholders' equity. 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?2637 Going Concern Doubt As reported in the Troubled Company Reporter on May 2, 2007, Mendoza Berger & Company LLP expressed substantial doubt about Brek Energy Corporation's ability to continue as a going concern after auditing the company's financial statements for the years ended Dec. 31, 2006, and 2005. Mendoza Berger pointed to the company's recurring operating losses and accumulated deficit. About Brek Energy Headquartered in Newport Beach, California, Brek Energy Corporation (Other OTC: BREK.PK) -- http://www.brekenergy.com/ -- through its subsidiaries, acquires, operates, and develops unconventional hydrocarbon prospects primarily in the Rocky Mountain region of the U.S. It principally acquires leasehold interests in petroleum and natural gas rights, either directly or indirectly. BROOKLYN STRUCTURED: S&P Puts 'BB' Rating Under Negative Watch -------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on the class A-1Q, A-2, A-3, A-4, B, and C notes issued by Armitage ABS CDO Ltd.; on the class A-1J, A-2L, A-3L, B, and C notes issued by Brooklyn Structured Finance CDO Ltd.; and on the class A-2, A-3, B, C-1, C-2, and D notes issued by Millstone IV CDO Ltd. on CreditWatch with negative implications. Standard & Poor's notes that Armitage ABS CDO Ltd. triggered an event of default on Dec. 3, 2007, under section 5.1(i) of the indenture dated March 29, 2007, when the class A overcollateralization ratio fell below 97.5%. On Nov. 30, 2007, Brooklyn Structured Finance CDO Ltd. triggered an EOD under section 5.01(i) of the indenture dated Nov. 30, 2006, when the ratio calculated by dividing the net outstanding portfolio collateral balance by the aggregate outstanding amount of the class A1S and A1J notes fell below 100%. Millstone IV CDO Ltd. triggered an EOD under section 5.1(h) of the indenture dated June 25, 2007, after the ratio calculated by dividing the net outstanding portfolio collateral balance by the aggregate outstanding amount of the class A notes fell below 100%. When Standard & Poor's receives EOD notices, S&P place all of the affected note ratings on CreditWatch with negative implications. Ratings Placed on Creditwatch Negative Rating ------ Transaction Class To From ----------- ----- -- ---- Armitage ABS CDO Ltd. A-1Q AAA/Watch Neg AAA Armitage ABS CDO Ltd. A-2 AAA/Watch Neg AAA Armitage ABS CDO Ltd. A-3 AAA/Watch Neg AAA Armitage ABS CDO Ltd. A-4 AA/Watch Neg AA Armitage ABS CDO Ltd. B A/Watch Neg A Armitage ABS CDO Ltd. C BBB/Watch Neg BBB Brooklyn Structured Finance A-1J AAA/Watch Neg AAA CDO Ltd. Brooklyn Structured Finance A-2L AA/Watch Neg AA CDO Ltd. Brooklyn Structured Finance A-3L A/Watch Neg A CDO Ltd. Brooklyn Structured Finance B BBB/Watch Neg BBB CDO Ltd. Brooklyn Structured Finance C BB/Watch Neg BB CDO Ltd. Millstone IV CDO Ltd. A-2 AAA/Watch Neg AAA Millstone IV CDO Ltd. A-3 AAA/Watch Neg AAA Millstone IV CDO Ltd. B AA/Watch Neg AA Millstone IV CDO Ltd. C-1 A/Watch Neg A Millstone IV CDO Ltd. C-2 A/Watch Neg A Millstone IV CDO Ltd. D BBB/Watch Neg BBB Other Outstanding Ratings Transaction Class Rating ----------- ----- ------ Armitage ABS CDO Ltd. A-1M AAA Brooklyn Structured Finance CDO Ltd. A-1S AAA Millstone IV CDO Ltd. A-1A AAA Millstone IV CDO Ltd. A-1B AAA Millstone IV CDO Ltd. A-1C AAA BROTMAN MEDICAL: Court Gives Final OK to Access $19.8MM Financing ----------------------------------------------------------------- The United States Bankruptcy Court for the Central District of California gave Brotman Medical Center Inc. authority to access, on an final basis, up to $19,875,000 in postpetition financing and other extensions of credit from CapitalSource Finance LLC. As reported in the Troubled Company Reporter on Nov. 8, 2007, the Debtor told the Court that before its bankruptcy filing, CapitalSource made certain loans, revolving credit and other financial accomodations available to the Debtor. On Oct. 29, 2007, the DIP financing facility was designed to permit the hospital to fund its working capital needs during the chapter 11 case, including obligations to its employees, trade vendors, suppliers and service providers. The Debtor granted in favor of the DIP lender security interest and liens and superiority claims status pursuant to Section 364 of the Bankruptcy Code, as adequate protection. In addition, the DIP lender will be entitled to receive adequate protection payments equal to a rate of prime plus 5.5% per annum on the outstanding amount due under the credit facility. Headquartered in Culver City, California, Brotman Medical Center Inc. -- http://www.brotmanmedicalcenter.com/-- provides range of inpatient and outpatient services, as well as rehabilitation, psychiatric care and chemical dependency. The company filed for Chapter 11 protection on Oct. 25, 2007 (Bankr. C.D. Calif. Case No. 07-19705). The Debtor have selected Kurtzman Carson Consultants LLC as its claims and noticing agent. The U.S. Trustee for Region 16 has not appointed creditors to serve on an Official Committee of Unsecured Creditors in this case. When the Debtor filed for protection against its creditors, it listed assets and debts between $1 million and $100 million. C-BASS MORTGAGE: Moody's Downgrades Ratings on 53 Tranches ---------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 53 tranches and placed on review for possible downgrade the ratings of 3 tranches issued by C-Bass Mortgage Loan Asset Backed Certificates in 2007. The collateral backing these classes consists of primarily first lien, fixed and adjustable-rate, subprime mortgage loans. In its analysis, Moody's has combined its published methodology updates as of July 13, 2007 to the non delinquent portion of the transactions. Collateral backing these transactions is also experiencing higher than anticipated rates of delinquency, foreclosure, and REO relative to credit enhancement levels. Complete list of Rating Actions: Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB1 -- Cl. M-2 Currently Aa2 on review for possible downgrade, -- Cl. M-3 Currently Aa3 on review for possible downgrade, -- Cl. M-4, Downgraded to A2, previously A1, -- Cl. M-5, Downgraded to Baa1, previously A2, -- Cl. M-6, Downgraded to Ba2, previously A3, -- Cl. M-7, Downgraded to B1, previously Baa1, -- Cl. M-8, Downgraded to B3 on review for possible further downgrade, previously Baa2, -- Cl. B-1, Downgraded to C, previously Baa3, -- Cl. B-2, Downgraded to C, previously Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB2 -- Cl. M-5, Downgraded to A3, previously A2, -- Cl. M-6, Downgraded to Baa1, previously A3, -- Cl. B-1, Downgraded to Ba1, previously Baa1, -- Cl. B-2, Downgraded to Ba2, previously Baa2, -- Cl. B-3, Downgraded to B3, previously Baa3, -- Cl. B-4, Downgraded to Ca, previously Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB3 -- Cl. M-3 Currently Aa3 on review for possible downgrade, -- Cl. M-4, Downgraded to A2, previously A1, -- Cl. M-5, Downgraded to Baa1, previously A2, -- Cl. M-6, Downgraded to Baa3, previously A3, -- Cl. B-1, Downgraded to Ba1, previously Baa1, -- Cl. B-2, Downgraded to Ba2, previously Baa2, -- Cl. B-3, Downgraded to B3, previously Baa3, -- Cl. B-4, Downgraded to Ca, previously Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB4 -- 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 Ba3, previously Baa3, -- Cl. B-4, Downgraded to B3, previously Ba1, -- Cl. B-5, Downgraded to Ca, previously Ba2. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB5 -- Cl. M-5, Downgraded to A3, previously A2, -- Cl. M-6, Downgraded to Baa2, previously A3, -- Cl. M-7, Downgraded to Baa3, previously Baa1, -- Cl. M-8, Downgraded to Ba3, previously Baa2, -- Cl. M-9, Downgraded to B2, previously Baa3, -- Cl. B-1, Downgraded to Ca, previously Ba1. Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2007-CB6 -- Cl. M-5, Downgraded to A3, previously A2, -- Cl. M-6, Downgraded to Baa1, previously A3, -- Cl. M-7, Downgraded to Ba1, previously Baa1, -- Cl. M-8, Downgraded to Ba2, previously Baa2, -- Cl. M-9, Downgraded to B2, previously Baa3, -- Cl. B-1, Downgraded to Caa2, previously Ba1. CAM COMMERCIAL: S&P Affirms 'B-' Rating on Class N Certificates --------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on four classes of commercial mortgage pass-through certificates from CAM Commercial Mortgage Corp.'s series 2002-CAM2. Concurrently, S&P affirmed 10 other ratings from the same series. The raised and affirmed ratings reflect credit enhancement levels that provide adequate support through various stress scenarios. As of the Nov. 14, 2007, remittance report, the trust collateral consisted of 26 mortgage loans and one class of subordinated fixed-rate commercial mortgage-backed securities (the class E pass-through certificates from Morgan Stanley Capital I Inc.'s series 1998-XL2) with an aggregate principal balance of $145.5 million. At issuance, the collateral consisted of 32 mortgage loans and two classes of subordinated fixed-rate CMBS pass-through certificates with an aggregate principal balance of $208.3 million. Excluding the $7.8 million (5%) of collateral that was defeased, the master servicer, Midland Loan Services Inc., reported full-year 2006 financial information for 100% of the loans in the pool. Based on this information, Standard & Poor's calculated a weighted average debt service coverage of 1.34x, down from 1.44x at issuance. All of the loans in the pool are current, and no loans are with the special servicer. The trust has not experienced a loss to date. The top 10 assets have an aggregate outstanding balance of $102.8 million (71%). The largest asset is the aforementioned class from Morgan Stanley Capital I Inc.'s series 1998-XL2. Excluding this asset, S&P calculated a weighted average DSC of 1.40x, down from 1.53x at issuance. The third-largest asset, which is the second-largest exposure secured by real estate, is on the master servicer's watchlist due to a low DSC and a decline in revenue and is discussed below. Standard & Poor's reviewed the property inspection reports provided by Midland for the properties underlying the top 10 assets, and all were reported to be in "good" or "excellent" condition. The master servicer's watchlist includes three loans totaling $18.1 million (12%). Among these loans is the second-largest real estate exposure in the pool, Wellington Centre ($13 million, 9%), which is secured by a 10-story, 201,600-sq.-ft. office building in Dallas, Texas. This loan was placed on the watchlist because of a reported low DSC (cash flow was negative as of Dec. 31, 2006) and a decline in revenue. The drop in revenue is attributable to a decrease in occupancy, which was 78% as of March 31, 2007, down from 96% at issuance. The borrower plans to upgrade the property to address the poor performance. Standard & Poor's stressed various assets as part of its analysis, including those on the watchlist and those otherwise considered credit impaired. The resultant credit enhancement levels adequately support the raised and affirmed ratings. Ratings Raised CAM Commercial Mortgage Corp. Commercial mortgage pass-through certificates series 2002-CAM2 Rating ------ Class To From Credit enhancement ----- -- ---- ---------------- C AA A+ 17.54% D A+ A 15.75% E A- BBB+ 13.60% F BBB+ BBB 12.88% Ratings Affirmed CAM Commercial Mortgage Corp. Commercial mortgage pass-through certificates series 2002-CAM2 Class Rating Credit enhancement ----- ------ ---------------- A-2 AAA 25.77% B AA+ 21.47% G BBB- 10.74% H BB+ 7.16% J BB 6.44% K BB- 5.73% L B+ 4.65% M B 3.94% N B- 3.22% X AAA N/A N/A - Not applicable. CANYON CAPITAL: Case Summary & Two Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Canyon Capital Partners, L.L.C. 6005 South Belvedere Avenue Tucson, AZ 85706 Bankruptcy Case No.: 07-02493 Chapter 11 Petition Date: December 6, 2007 Court: District of Arizona (Tucson) Judge: James M. Marlar Debtor's Counsel: Eric Slocum Sparks, Esq. 110 South Church Avenue, Suite 2270 Tucson, AZ 85701 Tel: (520) 623-8330 Fax: (520) 623-9157 Estimated Assets: Less than $10,000 Estimated Debts: $1 Million to $100 Million Debtor's Two Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ S.A.R.S., Inc. equipment $1,754,000 6991 North Solaz Tercero rent/purchase+ Tucson, AZ 85718 cb note Dyers goodwill $1,406,000 Dyers 10 year $600,000 property lease Cactus Auto Transport, Inc. goodwill: Phil $396,000 P.O. Box 90498 & Paula Delany Tucson, AZ 85752 c.b. note on $271,000 equipment equity 3rd party equipment $190,000 leases 3rd party pick-up $12,000 truck note [] CASTLETON GROUP: Hearing on Appeal vs. N.C. Insurance Set Today --------------------------------------------------------------- A hearing is scheduled today, Dec. 11, 2007, at the Superior Court of Wake County to discuss the merits of the stay motion filed by Castleton Group Inc. against the North Carolina Department of Insurance's decree denying it a license to operate. Insurance Commissioner Jim Long, on December 4, said that it had reached a decision in the licensure case of Castleton. According to the Department, it denied approval of a license to operate citing the company's "hazardous financial condition," and that these financials have dipped to the point of insolvency. That ruling, Department officials say, could affect 89 of Castleton's client companies, including approximately 3,000 employee, with many client companies seeing a flurry of end-of- year activity, including processing holiday pay checks and preparing W-2 tax forms. "We want Castleton's client companies to be fully aware of this decision so they can review their situations," said Commissioner Long. The Department contends that the company has never been licensed under the 2005 law but that same law has allowed Castleton to keep operating pending the resolution of the licensing dispute. Because of its appeal to the Court, Castleton was granted a temporary stay of the license denial pending a full hearing. The decision from the hearing officer in this case determined that the Castleton Group's liabilities exceed its assets by some $6 million. In addition, evidence showed that the company's former chief financial officer admitted to filing false federal payroll tax reports, resulting in an estimated $8 million in unpaid federal payroll taxes. The Department recommends that any client companies of Castleton Group immediately review their human resources needs in light of this decision. Companies that choose to seek services from a new professional employer organization have 90 licensed organizations in North Carolina from which to choose. Castleton's Side The company however verified the claims that the tax reports filed were false but said that it disclosed the improper accounting when it was discovered, Chris Coletta of the Triangle Business Journal in North Carolina reports, citing a company spokesperson. The company's spokesperson also said that the company had employed forensic accountants in order to look into the matter. The company disclosed revenue of $25 million in 2006, the report adds. The Castleton Group -- http://www.castletongroup.com/-- provides outsourced human resources services including human resources compliance, training, risk management and safety, benefits and payroll administration. CDC MORTGAGE: S&P Assigns Default Rating on Class B Certificates ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class M and B mortgage pass-through certificates from CDC Mortgage Capital Trust 2002-HE1. At the same time, S&P affirmed its 'AAA' rating on the class A certificates from this transaction. The lowered ratings reflect the deterioration of available credit support. As of the Oct. 25, 2007, distribution date, the failure of excess interest to cover monthly losses had resulted in the complete depletion of overcollateralization. This lack of O/C has caused a principal write-down of the B class. During the previous six remittance periods, monthly losses have exceeded excess interest by approximately 3.0x. As of the October 2007 distribution period, this transaction was 65 months seasoned and had realized $15.95 million in cumulative losses. Total delinquencies and severe delinquencies were 36.72% and 25.08% of the current pool balance, respectively. The affirmation of the rating on the class A certificates reflects a sufficient loss coverage percentage for the 'AAA' rating. As of the October distribution date, credit support for this class was 55.15%, which is more than 2.0x its original amount. Credit enhancement for this transaction is derived from a combination of subordination, excess interest, and O/C. The collateral supporting this transaction consists of subprime pools of fixed- and adjustable-rate mortgage loans secured by first liens on one- to four-family residential properties. Ratings Lowered CDC Mortgage Capital Trust 2002-HE1 Mortgage pass-through certificates Rating ------ Class To From ----- -- ---- M BB A B D CCC Rating Affirmed CDC Mortgage Capital Trust 2002-HE1 Mortgage pass-through certificates Class Rating ----- ------ A AAA CENTRAL MEMPHIS REGIONAL: Sale of GECC Collateral Set for Dec. 18 ----------------------------------------------------------------- General Electric Capital Corporation will attend a public auction and may make offers for the asset of Central Memphis Regional P.E.T. Imaging Center LLC, on account of unpaid debt owed to GECC, secured creditor. The asset offered for sale consist of rights, title and interest of the Debtor on its 2003 GE Discovery LS PET/CT 8 Slice System. The auction will be held at 3:00 p.m. on Dec. 18, 2007, at: Katten Muchin Rosenman LLP 525 West Monroe Street, 19th Floor Chicago, IL 60661 On the sale date, the assets may be offered for sale, with reserve, and sold to the highest bidder at the conclusion of the sales, as determined by GECC in its sole and absolute discretion, on an "as is, where is" basis, without recourse or warranties. Additional terms and conditions applicable to the sale may be obtained from GECC's counsel, Peter J. Young, Esq., through (312) 902-5208. Memphis, Tennessee-based Central Memphis Regional P.E.T. Imaging Center LLC -- http://www.memphispetcenter.com/-- provides doctors with the technology to conduct diagnosis better through its PET - Positron Emission Tomography. They offer services in the fields of oncology, neurology, and cardiology are some areas in which patients are benefiting most from PET technology. CHASE MORTGAGE: Moody's Assigns B2 Rating on Class B-4 Certs. ------------------------------------------------------------- Moody's Investors Service has assigned a Aaa rating to the senior certificates and a Aa1 rating to the senior support certificates. Moody's has also assigned ratings ranging from Aa2 to B2 for the suboordinate certificates issued by Chase Mortgage Finance Trust Series 2007-A3. The securitization is backed JPMorgan Chase Bank, N.A. originated adjustable-rate Jumbo mortgage loans. The ratings are based primarily on the credit quality of the loans and on the protection against credit losses provided by subordination. Moody's expects collateral losses to range from 0.45% to 0.55 %. JPMorgan Chase Bank, N.A. will service the loans. Moody's has assigned JPMorgan Chase Bank, N.A. its top servicer quality rating of SQ1 for prime loans. The complete rating actions are: Chase Mortgage Finance Trust Series 2007-A3 Multi-Class Mortgage Pass-Through Certificates -- Cl. 1-A1, Assigned Aaa -- Cl. 1-A2, Assigned Aa1 -- Cl. 1-A3, Assigned Aaa -- Cl. 1-A4, Assigned Aaa -- Cl. 1-A5, Assigned Aaa -- Cl. 1-A6, Assigned Aaa -- Cl. 1-A7, Assigned Aaa -- Cl. 1-A8, Assigned Aaa -- Cl. 1-A9, Assigned Aaa -- Cl. 1-A10, Assigned Aaa -- Cl. 1-A11, Assigned Aaa -- Cl. 1-A13, Assigned Aaa -- Cl. 1-A14, Assigned Aaa -- Cl. 1-A15, Assigned Aaa -- Cl. 1-A16, Assigned Aaa -- Cl. 1-A17, Assigned Aaa -- Cl. 1-A18, Assigned Aaa -- Cl. 1-A19, Assigned Aaa -- Cl. 1-A20, Assigned Aaa -- Cl. 1-A12, Assigned Aaa -- Cl. 2-A1, Assigned Aaa -- Cl. 2-A2, Assigned Aa1 -- Cl. 2-A3, Assigned Aaa -- Cl. 2-A4, Assigned Aaa -- Cl. 2-A5, Assigned Aaa -- Cl. 2-A6, Assigned Aaa -- Cl. 2-A7, Assigned Aaa -- Cl. 2-A8, Assigned Aaa -- Cl. 2-A9, Assigned Aaa -- Cl. 2-A10, Assigned Aaa -- Cl. 2-A11, Assigned Aaa -- Cl. 2-A12, Assigned Aaa -- Cl. 2-A13, Assigned Aaa -- Cl. 2-A14, Assigned Aaa -- Cl. 2-A15, Assigned Aaa -- Cl. 2-A16, Assigned Aaa -- Cl. 2-A17, Assigned Aaa -- Cl. 2-A18, Assigned Aaa -- Cl. 2-A19, Assigned Aaa -- Cl. 2-A20, Assigned Aaa -- Cl. 2-A21, Assigned Aaa -- Cl. 2-A22, Assigned Aaa -- Cl. 2-A23, Assigned Aaa -- Cl. 3-A1, Assigned Aaa -- Cl. 3-A2, Assigned Aa1 -- Cl. 3-A3, Assigned Aaa -- Cl. 3-A4, Assigned Aaa -- Cl. 3-A5, Assigned Aaa -- Cl. 3-A6, Assigned Aaa -- Cl. 3-A7, Assigned Aaa -- Cl. 3-A8, Assigned Aaa -- Cl. 3-A9, Assigned Aaa -- Cl. 3-A10, Assigned Aaa -- Cl. 3-A11, Assigned Aaa -- Cl. 3-A12, Assigned Aaa -- Cl. 3-A13, Assigned Aaa -- Cl. 3-A14, Assigned Aaa -- Cl. 3-A15, Assigned Aaa -- Cl. 3-A16, Assigned Aaa -- Cl. 3-A17, Assigned Aaa -- Cl. 3-A18, Assigned Aaa -- Cl. 3-A19, Assigned Aaa -- Cl. 3-A20, Assigned Aaa -- Cl. 3-A21, Assigned Aaa -- Cl. A-R, Assigned Aaa -- Cl. M, Assigned Aa2 -- Cl. B-1, Assigned A2 -- Cl. B-2, Assigned Baa2 -- Cl. B-3, Assigned Ba2 -- Cl. B-4, Assigned B2 CHASE MORTGAGE: Moody's Assigns Ba2 Rating on Cl. B-3 Certs. ------------------------------------------------------------ Moody's Investors Service has assigned Aaa ratings to super senior certificates and Aa1 for senior support certificates. Moody's has also assigned ratings ranging from Aa2 to B2 for the subordinate certificates issued by Chase Mortgage Finance Trust Series 2007- S6. The securitization is backed by JPMorgan Chase Bank, N.A. originated fixed-rate Jumbo residential mortgage loans. The ratings are based primarily on the credit quality of the loans and on protection from subordination. Moody's expects collateral losses to range from 0.45% to 0.55%. JPMorgan Chase Bank, N.A. will service the loans. Moody's has assigned JPMorgan Chase Bank, N.A. its top servicer quality rating of SQ1 as a primary servicer of prime residential mortgage loans. The complete rating actions are: Chase Mortgage Finance Trust 2007-S6 Multi-Class Mortgage Pass-Through Certificates, Series 2007-S6 -- Cl. 1-A1, Assigned Aaa -- Cl. 1-A2, Assigned Aa1 -- Cl. 1-A3, Assigned Aaa -- Cl. 1-AX, Assigned Aaa -- Cl. 2-A1, Assigned Aaa -- Cl. 2-A2, Assigned Aa1 -- Cl. 2-A3, Assigned Aaa -- Cl. 2-AX, Assigned Aaa -- Cl. A-P, Assigned Aaa -- Cl. A-R, Assigned Aaa -- Cl. M, Assigned Aa2 -- Cl. B-1, Assigned A2 -- Cl. B-2, Assigned Baa2 -- Cl. B-3, Assigned Ba2 -- Cl. B-4, Assigned B2 CHINA DIGITAL: Posts $72,361 Net Loss in Third Quarter ------------------------------------------------------ China Digital Communication Group reported a net loss of $72,361 on revenue of $336,539 for the third quarter ended Sept. 30, 2007, compared with net income of $1,234,730 on revenue of $4,031,597 in the comparable period in 2006. The significant revenue decrease was due to increased competition and decreased demand from customers for the three month period ended Sept. 30, 2007, as compared to the same period ended Sept. 30, 2006, and also because the 2007 numbers does not include the numbers from Sono, which was sold in April 2007. Loss from operations for the three month period ended Sept. 30, 2007 totaled $612,718 compared to income from operations of $1,301,316 for the three month period ended Sept. 30, 2006. The change to a loss from operations was primarily due to decrease in sales during the three month period ended Sept. 30, 2007. Bad debt recovery for the three month period ended Sept. 30, 2007, totaled $522,584 compared to bad debt expense of $5,882 for the three month period ended Sept. 30, 2006. The increase in bad debt recovery was due to significant efforts made by management and the company to collect those receivable previously reserved as bad debt. At Sept. 30, 2007, the company's consolidated balance sheet showed $15.9 million in total assets, $901,595 in total liabilities, and $15.0 million in total in total stockholders' equity. 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?263b Going Concern Doubt China Digital Communication group has sustained net losses of $2,725,483 since its inception, and the company's current operations do not generate sufficient cash to cover its operating costs. These conditions raise substantial doubt about the company's ability to continue as a going concern. About China Digital China Digital Communication Group (OTC BB: CHID) -- http://www.chinadigitalgroup.com/-- is a Nevada corporation with business headquarters in Shenzhen, China. Its primary business is the manufacture of components for batteries used in mobile phones and other digital devices. CHRYSLER LLC: Top Spokesman Quits Spurring Corporate Realignment ---------------------------------------------------------------- Jason H. Vines, Chrysler LLC's Vice President-Communications has elected to resign and, therefore, the company is disclosing a realignment of its Corporate Communications Department. "Now that Chrysler is an independent company again, we are taking every opportunity to realign functions in a more holistic manner that allows us to more effectively drive company strategy," Bob Nardelli, Chairman and CEO, said. "As part of this realignment, the corporate communications function will now report to Nancy Rae, Senior Vice President-Human Resources." Several executives in the corporate communications department will report directly to Ms. Rae. David Barnas, who has been in the corporate communications department for six years, will be responsible for internal and corporate communications, which includes dealing with the news media. Mr. Vines' resignation is effective immediately, although he has agreed to remain at Chrysler through the end of December to assist in the transition. "Jason has served Chrysler well, and we are very grateful for his many contributions over the years," Mr. Nardelli said. Mr. Vines began his career at Chrysler Corporation in 1983, serving first as an economics researcher in the Labor Relations Department and later through various assignments in Employee Communications and Public Relations. He left Chrysler in 1998 and became Vice President-Communications for Nissan North America. In February 2000, he was appointed Vice President-Communications for Ford Motor Company. He returned to Chrysler in 2003 as Vice President-Communications. "This was a tough decision, considering the many talented, longtime friends I have throughout the company," Mr. Vines said. "I wish them all the best and will continue to root for them." Mike Aberlich, who has served the company as Director, Corporate and Internal Communications, also announced last week that he has decided to retire at the end of this year. "We thank Mike for his dedication and contributions to the company," Mr. Nardelli added. Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Dec. 10, 2007, Standard & Poor's Ratings Services revised its recovery rating on Chrysler's $2 billion senior secured second-lien term loan due 2014. The issue-level rating on this debt remains unchanged at 'B', and the recovery rating was revised to '3', indicating an expectation for meaningful (50% to 70%) recovery in the event of a payment default, from '4'. CITIGROUP MORTGAGE: Moody's Lowers Ratings on 52 Tranches --------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 52 tranches and placed on review for possible downgrade the ratings of 7 tranches from 10 transactions issued by Citigroup Mortgage Loan trust in 2007. Additionally, 5 downgraded tranches remain on review for possible further downgrade. The collateral backing these classes consists of primarily first lien, fixed and adjustable-rate, subprime mortgage loans. In its analysis, Moody's has combined its published methodology updates as of July 13, 2007 to the non delinquent portion of the transactions. Collateral backing these transactions is also experiencing higher than anticipated rates of delinquency, foreclosure, and REO relative to credit enhancement levels. Complete list of Rating Actions: Issuer: Citigroup Mortgage Loan Trust 2007-AHL1 -- Cl. M-6, Downgraded to Baa1, previously A3, -- Cl. M-7, Downgraded to Baa3, previously Baa1, -- Cl. M-8, Downgraded to Ba1, previously Baa1, -- Cl. M-9, Downgraded to B1, previously Baa3, -- Cl. M-10, Downgraded to Caa3, previously Ba1, -- Cl. M-11, Downgraded to C, previously Ba2. Issuer: Citigroup Mortgage Loan Trust 2007-AHL2, Asset-Backed Pass-Through Certificates, Series 2007-AHL2 -- Cl. M-5, Downgraded to A3, previously A2, -- Cl. M-6, Downgraded to Baa1, previously A3, -- Cl. M-7, Downgraded to Baa3, previously Baa1, -- Cl. M-8, Downgraded to Ba2, previously Baa2, -- Cl. M-9, Downgraded to B1, previously Baa3, -- Cl. M-10, Downgraded to Caa2, previously Ba1. Issuer: Citigroup Mortgage Loan Trust 2007-AHL3 -- Cl. M-6, Downgraded to A3, previously A2, -- Cl. M-7, Downgraded to Baa1, previously A3, -- Cl. M-8, Downgraded to Baa3, previously Baa1, -- Cl. M-9, Downgraded to Ba1, previously Baa2, -- Cl. M-10, Downgraded to B3 on review for possible further downgrade, previously Baa3. Issuer: Citigroup Mortgage Loan Trust 2007-AMC1 -- Cl. M-1 Currently Aa1 on review for possible downgrade, -- Cl. M-2 Currently Aa2 on review for possible downgrade, -- Cl. M-3 Currently Aa3 on review for possible downgrade, -- Cl. M-4, Downgraded to Baa1, previously A1, -- Cl. M-5, Downgraded to Ba1, previously A2, -- Cl. M-6, Downgraded to B1, previously A3, -- Cl. M-7, Downgraded to Caa2, previously Baa1, -- Cl. M-8, Downgraded to C, previously Baa2, -- Cl. M-9, Downgraded to C, previously Baa3, -- Cl. M-10, Downgraded to C, previously Ba1. Issuer: Citigroup Mortgage Loan Trust 2007-AMC2 -- Cl. M-1 Currently Aa1 on review for possible downgrade, -- Cl. M-2 Currently Aa2 on review for possible downgrade, -- Cl. M-3 Currently Aa3 on review for possible downgrade, -- Cl. M-4, Downgraded to Baa2, previously A1, -- Cl. M-5, Downgraded to Ba3, previously A2, -- Cl. M-6, Downgraded to B3* on review for possible further downgrade, previously A3, -- Cl. M-7, Downgraded to Caa3, previously Baa1, -- Cl. M-8, Downgraded to C, previously Baa2, -- Cl. M-9, Downgraded to C, previously Baa3, -- Cl. M-10, Downgraded to C, previously Ba1. Issuer: Citigroup Mortgage Loan Trust 2007-AMC3 -- Cl. M-5, Downgraded to A3, previously A2, -- Cl. M-6, Downgraded to Baa2, previously A3, -- Cl. M-7, Downgraded to Ba1, previously Baa1, -- Cl. M-8, Downgraded to Ba3, previously Baa2, -- Cl. M-9, Downgraded to B3 on review for possible further downgrade, previously Baa3, -- Cl. M-10, Downgraded to Ca, previously Ba1. Issuer: Citigroup Mortgage Loan Trust 2007-AMC4 -- Cl. M-6 Currently Aa3 on review for possible downgrade, -- Cl. M-7, Downgraded to A2, previously A1, -- Cl. M-8, Downgraded to Baa1, previously A2, -- Cl. M-9, Downgraded to Ba3, previously Baa1, -- Cl. M-10, Downgraded to B1, previously Baa2, -- Cl. M-11, Downgraded to B3 on review for possible further downgrade, previously Baa2. Issuer: Citigroup Mortgage Loan Trust 2007-WFHE1 -- Cl. M-9, Downgraded to Ba2, previously Baa2, -- Cl. M-10, Downgraded to B1, previously Ba1, -- Cl. M-11, Downgraded to Caa3, previously Ba2. Issuer: Citigroup Mortgage Loan Trust 2007-WFHE2 -- Cl. M-8, Downgraded to Baa3, previously Baa1, -- Cl. M-9, Downgraded to Ba3, previously Baa2, -- Cl. M-10, Downgraded to B3 on review for possible further downgrade, previously Baa3. Issuer: Citigroup Mortgage Loan Trust 2007-WFHE3 -- Cl. M-8, Downgraded to Baa1, previously A3, -- Cl. M-9, Downgraded to Baa3, previously Baa1, -- Cl. M-10, Downgraded to Ba3, previously Baa3, -- Cl. M-11, Downgraded to B3, previously Ba2. CJ KELLEY: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Lead Debtor: CJ Kelley, LLC 133 Defense Hwy, #103 Annapolis, MD 21401 Bankruptcy Case No.: 07-80765 Chapter 11 Petition Date: December 7, 2007 Court: Northern District of Georgia (Atlanta) Judge: Paul W. Bonapfel Debtor's Counsel: M. Denise Dotson, Esq. Jones & Walden, LLC 21 Eighth Street, NE Atlanta, GA 30309 Tel: (404) 564-9300 Fax : (404) 564-9301 http://www.joneswalden.com/ Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Richard Alembik, Esq. legal fees $55,000 315 West Ponce de Leon Ave Ste 250 Decatur, GA 30030 Sawin and Baldwin Insurance property insurance $22,597 107 W Lufkin Ave # 318 Lufkin, TX 75904 Paragon Realty Services $17,699 9920 Misty Cove Lane Gainesville, GA 30506 Robet Philipson & Co. accounting $12,002 City of Atlanta utilities $8,825 Infinite Energy utilities $7,019 Villard Bastien, Esq. legal fees $4,400 Georgia Power utilities $4,000 Charles and Becky Ricketts investor $3,025 Platinum Roofing $1,625 Charles Hunter investor $0 Charles Zarganis investor $0 Denise Stewart $0 Dennis and Anne Small investor $0 John and Tami Zarganis investor $0 Kelly Miller Smith investor $0 Robert and Denise Stewart investor $0 Robert Stewart $0 Tek Singal investor $0 Thomas and Sharon Stanton investor $0 CLAYTON HOLDINGS: Poor Performance Cues Moody's to Cut Ratings -----------------------