TCR_Public/080103.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, January 3, 2008, Vol. 12, No. 2

                             Headlines


ADVANTA BANK: Fitch Maintains BB- Rating with Stable Outlook
ADVANTA CORP: Fitch Affirms BB- Long-Term Issuer Default Rating
ALLEGHENY ENERGY: Credit Improvement Cues Fitch to Lift Ratings
AMERICAN HOME: Settles Servicing Rights Dispute With Countrywide
AMERICAN HOME: Wants 1st Amended DIP Loan & Security Pact Okayed

AMERICAN HOME: Wants to Set Servicing Biz. Sale Consummation
ANGIOTECH PHARMACEUTICALS: S&P Holds B- Corporate Credit Rating
ASCENDIA BRANDS: Senior Lenders Waive Default Until February 28
ASSET BACKED FUNDING: Fitch Junks Ratings on Two Certificates
ATARI INC: Has Until March 20 to Comply with Nasdaq Listing Rules

BALLY TECHNOLOGIES: Earns $21 Mil. in Quarter Ended September 30
BANK OF AMERICA: Fitch Puts Low-B Ratings on Six Certificates
BEAR STEARNS: Fitch Assigns Low-B Ratings on Six Certificates
BFA LIQUIDATION: To Sell Arizona Land at Absolute Public Auction
BOISE PAPER: S&P Pairs BB- Corporate Rating With Stable Outlook

CAM CBO: Review Cues Fitch to Change Rating to C/DR6 from C/DR4
NEW ORLEANS SEWERAGE: Moody's Maintains Ba2 Debt Rating
CONSOLIDATED COMMS: Closes $362.6M North Pittsburgh Systems Buyout
CONSULTING & SAFETY: Case Summary & 19 Largest Unsecured Creditors
CWMBS INC: Fitch Rates $2,747,200 Class B-3 Certificates at BB

DANA CORP: 24 Investor Groups to Buy $540 Million New Dana Shares
DELPHI CORP: Court Approves Sale of Steering Biz for for $447 Mil.
DELPHI CORP: Ct. Extends Exclusive Plan-Filing Period to March 31
DIXIE GROUP: Moody's Withdraws Ratings for Business Reasons
DUKE ENERGY: Moody's Places Global Local Currency Rating at Ba2

DUNMORE HOMES: Gets Final OK to Borrow $1 Mil. from Sydney Dunmore
DUNMORE HOMES: Can Use Dunmore's Cash Collateral on a Final Basis
ECHOSTAR COMMS: Distributes Shares for Separation of Businesses
FGX INT'L: Moody's Withdraws All Ratings After Debt Refinancing
FIRST DARTMOUTH: Case Summary & 13 Largest Unsecured Creditors

FIRST FRANKLIN: Weak Performance Cues S&P to Downgrade Ratings
FIRSTLIGHT HYDRO: S&P Holds BB- Rating on $320MM Mortgage Bonds
FIRSTLIGHT POWER: S&P Holds BB- Rating on $695MM Sr. Facilities
GENTEK INC: Subsidiary Acquires Bay Chemical for $7 Million
HARMAN INTERNATIONAL: Elects Gary Steel to Board of Directors

JADE ART: Oct. 31 Balance Sheet Upside-Down by $9.77 Million
KAUFMAN COUNTY: Case Summary & Four Largest Unsecured Creditors
KINGSWAY FINANCIAL: Secures to CDN$70 Million Credit Facility
LEAP WIRELESS: S&P Maintains B- Corporate Credit Rating
MIDNIGHT HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $36.5MM

MORGAN STANLEY: Fitch Rates Three Certificate Classes at Low-B
NASDAQ STOCK: Gets CFIUS Clearance on Borse Dubai Investment Deal
NASDAQ STOCK: OMX AB Board Backs Borse Dubai's Public Offer
NATIONAL LAMPOON: Oct. 31 Balance Sheet Upside-Down by $4.13 Mil.
NAVIOS MARITIME: Shareholders OK Class B Directors Election

NORTH STREET: Fitch Holds 'B' Rating on $31 Mil. Class C Notes
NY RACING: Plan Confirmation Hearing Deferred to January 14
PACIFIC LUMBER: Loses Exclusive Right to File Reorganization Plan
PACIFIC LUMBER: Scopac Can Use Funds in SAR Account for 2nd Budget
PERFORMANCE TRANS: Gets Interim Nod to Use $6 Mil. DIP Funding

PERFORMANCE TRANS: Lenders Want Yucaipa, et al. to Produce Docs
PERFORMANCE TRANS: Committee Can Hire Blank Rome as its Counsel
PHYTOMEDICAL TECH: Posts $353,094 Net Loss in Third Quarter
POPE & TALBOT: Canada Court OKs Bid Procedures for Pulp Business
POPE & TALBOT: Bid Protocol for Remaining Wood Business Approved

POPE & TALBOT: Court Approves KPMG LLP as Independent Auditor
POWERLINX INC: Sept. 30 Balance Sheet Upside-Down by $3.16 Million
PUTNAM CBO: Fitch Retains 'CC' Rating on Second Priority Notes
RCN CORP: Inks New 3-Year Pact w/ Peter Aquino as President & CEO
SALTON INC: Closes APN Holding Buyout; Harbinger Holds 92% Stake

SASCO MORTGAGE: Fitch Takes Rating Actions on Diverse Classes
SECURITIZED ASSET: Fitch Chips Ratings on Four Certs. to Low-B
SOLAR INVESTMENT: Fitch Retains 'CC' Ratings on Two Notes
SUN COAST: Case Summary & 20 Largest Unsecured Creditors
SUN COAST: Inks $19.7 Million Sale Pact With HCA West Florida

TERWIN MORTGAGE: Fitch Junks Rating on Class M-5 Certs. from 'B'
TRANSMETA CORP: Posts $9.1 Million Net Loss in Third Quarter
UAP HOLDING: Agrium Inc. Withdraws Merger Notification
WHEELING ISLAND GAMING: S&P Withdraws "B" Rating on Senior Notes
WR GRACE: Charleston City Wants Stay Lifted to Seize Property

WR GRACE: Wants to Settle Environmental Claims for $44 Million
YRC WORLDWIDE: Earns $40.7 Million in Third Quarter
YRC WORLDWIDE: Expects 4th Qtr. Impairment Chgs. of $700-$800 Mil.

* Survey Says CMI Finishes 2007 With Another Slight Drop
* Trade Credit Index Falls to Record Low Level Says Eueler Hermes

* Chapter 11 Cases with Assets & Liabilities Below $1,000,00


                             *********

ADVANTA BANK: Fitch Maintains BB- Rating with Stable Outlook
------------------------------------------------------------
Fitch Ratings has affirmed the long-term Issuer Default Rating  of
Advanta Bank Corp. and Advanta Corp. at 'BB-'.  The Rating Outlook
was revised to Stable from Positive.  Approximately $2.0 billion
of debt and deposits is affected by the action.  Fitch has
affirmed these ratings with a Stable Outlook:

Advanta Bank Corp.

  -- Long-term IDR at 'BB-';
  -- Short-term IDR at 'B';
  -- Long-term Deposits at 'BB'

Advanta Corp:

  -- Long-term Issuer Default Rating (IDR) at 'BB-';
  -- Short-term IDR at 'B';
  -- Senior Unsecured at 'BB-'

Advanta Capital Trust I

  -- Trust Preferred Stock at 'B'.

The rating affirmation reflects the company's solid position in
the small business credit card industry, improved asset quality
relative to historical levels, consistent profitability metrics,
and adequate risk-adjusted capitalization, offset by growing
competition in the small business credit card sector, and the
risks associated with a lack of revenue diversity and its mono-
line business focus.

The Outlook revision reflects the recent deterioration in
portfolio credit quality, resulting from higher delinquency roll-
rates following the 2005 change in bankruptcy legislation, and the
uncertain capital markets environment, which could disrupt funding
plans for Advanta, which is heavily reliant on the securitization
market for funding.

The Stable Outlook reflects the company's stable liquidity
profile, adequate risk-adjusted capitalization, and the
expectation that credit quality metrics will deteriorate from
current levels over the near to intermediate-term.  Material,
persistent, declines in credit metrics and risk-adjusted revenue
margins, a reduction in liquidity, and/or a decline in risk-
adjusted capitalization could result in negative rating action.
Conversely, stabilization of asset quality metrics, increased
funding diversity, and higher risk-adjusted capitalization could
provide rating momentum.


ADVANTA CORP: Fitch Affirms BB- Long-Term Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has affirmed the long-term Issuer Default Rating  of
Advanta Corp. and Advanta Bank Corp. at 'BB-'.  The Rating Outlook
was revised to Stable from Positive.  Approximately $2.0 billion
of debt and deposits is affected by the action.  Fitch has
affirmed these ratings with a Stable Outlook:

Advanta Corp:

  -- Long-term Issuer Default Rating (IDR) at 'BB-';
  -- Short-term IDR at 'B';
  -- Senior Unsecured at 'BB-'

Advanta Bank Corp.

  -- Long-term IDR at 'BB-';
  -- Short-term IDR at 'B';
  -- Long-term Deposits at 'BB'

Advanta Capital Trust I

  -- Trust Preferred Stock at 'B'.

The rating affirmation reflects the company's solid position in
the small business credit card industry, improved asset quality
relative to historical levels, consistent profitability metrics,
and adequate risk-adjusted capitalization, offset by growing
competition in the small business credit card sector, and the
risks associated with a lack of revenue diversity and its mono-
line business focus.

The Outlook revision reflects the recent deterioration in
portfolio credit quality, resulting from higher delinquency roll-
rates following the 2005 change in bankruptcy legislation, and the
uncertain capital markets environment, which could disrupt funding
plans for Advanta, which is heavily reliant on the securitization
market for funding.

The Stable Outlook reflects the company's stable liquidity
profile, adequate risk-adjusted capitalization, and the
expectation that credit quality metrics will deteriorate from
current levels over the near to intermediate-term.  Material,
persistent, declines in credit metrics and risk-adjusted revenue
margins, a reduction in liquidity, and/or a decline in risk-
adjusted capitalization could result in negative rating action.
Conversely, stabilization of asset quality metrics, increased
funding diversity, and higher risk-adjusted capitalization could
provide rating momentum.


ALLEGHENY ENERGY: Credit Improvement Cues Fitch to Lift Ratings
---------------------------------------------------------------
Fitch Ratings upgraded these Issuer Default Ratings (IDR) and
outstanding debt ratings of Allegheny Energy Inc. and
subsidiaries:

Allegheny Energy, Inc. (AYE)

  -- IDR to 'BBB-' from 'BB+'.

Allegheny Energy Supply Company, LLC (Supply)

  -- IDR to 'BBB-' from 'BB+'.
  -- Senior secured to 'BBB' from 'BBB-'.
  -- Senior unsecured to 'BBB-' from 'BB+'.

Allegheny Generating Co.

  -- IDR to 'BBB-' from 'BB+'.
  -- Senior unsecured to 'BBB-' from 'BB+'.

The Rating Outlook is Stable.

The ratings of AYE's three regulated utility subsidiaries:

  -- West Penn Power Company (West Penn; IDR rated 'BBB-',
     Outlook Stable);

  -- Monongahela Power Company (Mon Power; IDR rated 'BBB-',
     Outlook Stable); and

  -- Potomac Edison Company (Potomac Ed; IDR rated 'BB+',
     Outlook Negative) are unaffected by this rating actions.

Fitch's rating upgrade of AYE and Supply to 'BBB-' reflects credit
improvement resulting from increases in cash flow from higher
realized prices on power sales, as well as lower debt balances and
associated carrying costs.  Consolidated debt has been reduced by
approximately $2 billion over the past four years primarily with
internal cash flow as well proceeds from asset sales.  The ratios
of (FFO + Interest)/Interest for AYE on a consolidated basis and
for the Supply subsidiary were approximately 4.6 times and 4.4x
for the twelve months ending Sept. 30, 2007, which are consistent
with guidelines for the new ratings and the issuers' business and
operating risk.  The ratios of FFO to Debt exceeded 20% as of
Sept. 30, 2007 for AYE and Supply.

AYE's ratings are supported by these:

  -- Ownership of increasingly valuable coal-fired generation
     in PJM;

  -- Ample liquidity;

  -- Reasonable residential transition plans in PA and MD
     utility service territories; and

  -- Reinstatement of the energy adjustment clause in West
     Virginia.

Supply provides approximately 50% of AYE's consolidated cash flow
and its contribution is expected to increase as higher power sales
prices are realized.

For the next several years, AYE has limited long-term debt
maturities.  The parent company and Supply have access to two
revolving credit facilities in the amounts of $400 million and
$400 million, respectively, and also there is a system money pool.
There was nearly $200 million of cash and equivalents as of Sept.
30, 2007 and cash balances were subsequently increased by West
Penn's $275 million 5.95% first mortgage bond issuance in December
2007.

Fitch's rating concerns for the AYE group include risks for these:

  -- Under-recovery or recovery lags in purchased power and
     other costs at the utilities;

  -- Adverse changes in retail market structure or regulation,
     increases in operating costs and capital spending;

  -- Stricter environmental regulations; and

  -- Prolonged outages of super-critical units.

While Supply had formerly been the greater source of Fitch's
credit concerns, Fitch's current view is that there is greater
risk to creditors at the utilities as a result of regulatory
uncertainties.

AYE's Stable Outlook assumes that Maryland and Pennsylvania
regulators permit full recovery of purchased power costs in
tariffs following the expiry of the current rate settlements (Dec.
31, 2008 for MD residential load and Dec. 31, 2010 in PA).
Approximately 25% of the Maryland residential customer power needs
for the post-transition period was procured in an October 2007
auction and the second of four auctions is scheduled for January
2008.  However, the Maryland Public Service Commission is
considering changes to the market structure that could affect cash
flows of AYE or its subsidiaries Supply or Potomac Ed.

The continued tightening of PJM Interconnection capacity markets
bodes well for Supply as an owner of efficient baseload coal-fired
power generation assets.  Challenges for Supply include stricter
emission standards, successful completion of the scrubber
construction program, and improving plant operation factors.  The
initiation of carbon limits could affect credit because
approximately 95% of energy is generated with coal.  Fitch
anticipates some improvement in unit availability of the company's
major coal plants as a result of completion of major maintenance
projects in 2007.  However, Fitch considers management's
availability goal of 91% for 2008 to be aggressive given plant
operating track records over the past five years, (reduced
maintenance outages should lead to some improvement in 2008 from
the 84% estimated 2007 availability).  There has been steady
progress on the Hatfield and Fort Martin scrubber projects and
construction budgets are still on track for $550 million and $725
million, respectively and a significant majority of the remaining
scrubber budgets are fixed.

The upgrade of Allegheny Generating Co. results from the upgrade
of its 59% owner, Supply.  Allegheny Generating's single asset is
an interest in the Bath County pumped storage unit.  It has
consistently strong stand-alone credit metrics with (FFO +
Interest)/Interest of approximately 6x.


AMERICAN HOME: Settles Servicing Rights Dispute With Countrywide
----------------------------------------------------------------
To resolve the objections of Countrywide Bank, N.A., regarding
the proposed sale of its servicing rights related to certain
loans, which American Home Mortgage Investment Corp. and its
debtor-affiliates have been servicing, the parties negotiated,
and agreed to a consensual resolution by entering into a
purchase agreement approved by the Honorable Christopher S.
Sontchi.

Pursuant to Sections 105 and 363 of the Bankruptcy Code, the
Court authorized the Debtors to enter into a purchase
agreement, and to sell, transfer and convey Countrywide's
servicing rights to AHM Acquisition Co. Inc., free and clear of
all liens and interests, provided that the liens and security
interests of the administrative agent will attach to the proceeds
of the sale.

Judge Sontchi ruled that all proceeds of the sale, including the
proceeds from all outstanding documented advances, will be paid
in accordance with the terms of his prior order authorizing the
limited use of certain secured lenders' cash collateral.  He
noted that to the extent Countrywide intends to assert a general
unsecured claim for service breach, it will be obligated to file
a proof of claim on or before January 11, 2008.  He added that
the automatic stay is modified to the extent necessary to
implement the terms and conditions of the Purchase agreement and
the provisions of the Court order.

                Creditors Object to Cure Amounts

Certain creditors submit objections to the initial cure amounts
set by the Debtors.  The Debtors have pegged the cure claim of
the creditors at $0.  The Creditors contend that the correct cure
amounts are:

     Creditor                          Cure Claim
     --------                          ----------
     UBS Real Estate                   $2,588,839
     Securities, Inc.

     U.S. Bank National Association       288,590

     ZC Real Estate Tax                   150,949
     Solutions Limited

     American Security Entities            71,931

     Citibank, N.A.                        59,783

     Wells Fargo Bank,                     33,401
     National Association

     CitiMortgage, Inc.                     5,302

     De Lage Landen Financial               4,431
     Services, Inc.

Included in the American Security Entities are American Security
Insurance Company, Standard Guaranty Insurance Company, Voyager
Indemnity Insurance Company, and Assurant Group.

DB Structured Products, Inc., whose cure amount was also pegged
at $0, objects to the Debtors' cure notice to the extent it would
purport to sever cure obligations from the servicing portion of a
certain master mortgage loan purchase and servicing agreement
between DBSP and certain Debtors prior to the resolution of
DBSP's appeal, and in contravention of the second amendment of
the Debtors' asset purchase agreement with AH Mortgage
Acquisition Co., Inc.

The Bank of New York says it is not presently aware of any other
defaults or other basis for cure claims, aside from what it
previously filed, under its servicing agreements with the
Debtors.  BofNY tells the Court that its objection is not a
waiver of any of its rights including, the right to trial by jury
that it may have in any civil proceeding arising in or related to
the bankruptcy cases.

De Lage Landen reserves its rights to amend and supplement its
objection to the extent that it becomes aware of additional
information concerning any of the remaining leases the Debtors
may seek to assume.

                       About American Home

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 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 March 3, 2008.  (American Home Bankruptcy
News, Issue No. 21, Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN HOME: Wants 1st Amended DIP Loan & Security Pact Okayed
----------------------------------------------------------------
American Home Mortgage Investment Corp., American Home Mortgage
Holdings Inc., American Home Mortgage Corp., American Home
Mortgage Acceptance Inc., American Home Mortgage Ventures LLC,
Homegate Settlement Services Inc., and Great Oak Abstract Corp.
seek authority from the U.S. Bankruptcy Court for the District
of Delaware to approve certain amendments to the previously
approved Debtor-in-Possession Loan and Security Agreement, dated
as of Aug. 6, 2007, between them and WLR Recovery Fund III, L.P.

The DIP Facility provided for a $50,000,000 postpetition
financing, however, it does not permit the Borrowers to utilize
the borrowings to fund the operations or expenses associated with
their mortgage loan servicing business.  Subsequently, certain of
the Debtors sought and obtained the Court's approval to obtain a
limited recourse postpetition financing in the principal amount
of $50,000,000.

James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor
LLP, in Wilmington, Delaware, relates that recent developments in
the bankruptcy cases, including the sale of the Servicing
Business and the initial closing, have resulted in the Borrowers'
need to modify certain terms of the DIP Facility.  As a result,
the Borrowers, the Lenders and the administrative agent have
agreed to amend the DIP Facility through the terms and conditions
of the First DIP Facility Amendment.

Among the key terms of the First DIP Facility Amendment are:

   -- The Total commitment under the DIP Facility is reduced from
      $50,000,000 to $35,000,000;

   -- The definition of "Maturity Date" in the DIP Facility is
      amended to include reference to the sale of all or
      substantially all of the equity interest of all of the
      assets of that certain specified banking subsidiary;

   -- A section of the DIP Facility is amended to provide for the
      reduction of the borrowing availability under the DIP
      Facility in the amount of the lender purchased mortgage
      insurance, the LPMI, reserve amount;

   -- A section of the DIP Facility is amended to permit the
      Borrowers to utilize borrowings to fund the making or
      purchasing of certain advances pursuant to the asset
      purchase agreement with AH Mortgage Acquisition Co., Inc.,
      in connection with the sale of the Servicing Business;

   -- The Lenders permit the Borrowers to use the Borrowers'
      cash, on which the Lenders have a lien, to obtain the
      release of Bank of America, N.A.'s liens on the BofA
      construction loans;

   -- The Amendment will grant a first priority lien on the BofA
      Construction Loans upon the payment of certain advances.
      The lien will be released when the Borrowers have
      recovered an amount equal to the Construction Loan Advance
      through the collection, payoff, compromise, sale or other
      disposition of the BofA Construction Loans;

   -- The Amendment will provide for the Lenders consent to the
      Borrowers' collection, compromise, sale or other
      disposition of the BofA Construction Loans in any manner
      the Borrowers deem appropriate;

   -- The parties of the DIP Facility waive any default that may
      have occurred in connection with the Borrower's payment of
      certain LPMI advances from the Borrowers' cash; and

   -- The Borrowers agree to pay WLR Recovery $100,000 as an
      amendment fee.

Mr. Patton contends that the reduction of the availability of
borrowings under the DIP Facility will result, among other
things, in a reduction of the interest escrow required under the
DIP Facility by $1,200,000, and thus, interest payment savings to
the Borrowers and the bankruptcy estates.  He also says that the
Amendment is necessary to ensure compliance with the APA and the
uninterrupted servicing of the loans not purchased by AHM
Acquisition.

Additionally, Mr. Patton points out, among other reasons, that
the Amendment is necessary because of certain advances made by
the Borrowers from Borrowers' cash to fund premiums on LPMI, and
to fund an escrow held by BofA pending resolution of disputes
between the Debtors and BofA regarding responsibility for LPMI
premium obligations.

Pursuant to Rules 2002, 4001 and 9014 of the Federal Rules of
Bankruptcy Procedure, the Debtors ask the Court to shorten the
notice applicable to their request, reducing the time by which
interested parties must respond to the request.  They ask Judge
Sontchi to commence a hearing on Friday, Jan. 4, 2008, at
11:00 a.m., to consider the request.

                       About American Home

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 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 March 3, 2008.  (American Home Bankruptcy
News, Issue No. 21, Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN HOME: Wants to Set Servicing Biz. Sale Consummation
------------------------------------------------------------
American Home Mortgage Investment Corp. and its debtor-
affiliates seek permission from the U.S. Bankruptcy Court for
the District of Delaware to undertake certain activities to
prepare for the consummation of the previously-approved sale of
their mortgage loan servicing business to AH Mortgage Acquisition
Co. Inc. pursuant to the terms of an assset purchase agreement.

Under the APA, the Sale will close in two steps, in which the
initial "economic" close occurred on November 16, 2007.  From the
Initial Closing Date until the "legal" close on the final closing
date, the Debtors will continue to operate the Servicing
Business, subject to certain bankruptcy exceptions, for the
economic benefit and risk of AHM Acquisition, James L. Patton,
Jr., Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington,
Delaware, relates.

Accordingly, the Debtors seek authority to:

   -- create one or more non-debtor business entities, which may
      include corporations, limited liability companies and
      transition entities, for entering into certain agreements
      relating to the transition of the purchased assets from the
      sellers to the purchaser, or relating to the continued
      operation of the Servicing Business;

   -- fund the Transition Entities with amounts sufficient to
      perform their respective obligations under the Transition
      Entities Agreements;

   -- enter into a fourth amendment to the APA, which provides,
      among other things, that the Debtors' interests in the
      Transition Entities will be deemed Purchased Assets under
      certain provisions of the APA;

   -- enter into a employment agreement, between American Home
      Mortgage Servicing, Inc., and David M. Friedman;

   -- file the Employment Agreement with the Court under seal,
      and direct that the Employment Agreement remain under seal,
      confidential and not be made available to anyone, except
      for the Court, the office of the U.S. Trustee, counsel to
      the Official Committee of Unsecured Creditors, counsel to
      Bank of America, N.A., AHM Acquisition, and counsel to the
      DIP Lenders; and

   -- limit service of the request to:

      * the U.S. Trustee;

      * counsel to the Creditors Committee;

      * counsel to BofA;

      * counsel to the Debtors' postpetition lender;

      * counsel to AHM Acquisition; and

      * all other parties entitled to notice under Rule 2002-1(b)
        of the Local Rules of Bankruptcy Practice and Procedure
        of the United States Bankruptcy Court for the District of
        Delaware.

Mr. Patton asserts that the Transition Entities will assist the
Debtors in transitioning the Purchased Assets to AHM Acquisition,
and facilitate the continued operation of the Servicing Business.
He notes that the creation of the Transition Entities would
provide a smooth transition, which in turn benefits all parties-
in-interest to the bankruptcy proceedings.  He points out that
the Debtors believe that their counterparties to certain
contracts will more readily enter into contracts with the non-
debtor Transition Entities than with the Debtors, because the
Transition Entities are not debtors in the proceedings and will
become subsidiaries of AHM Acquisition upon the Final Closing.

Prior to the Final Closing, the Transition Entities will be
funded by the Sellers to the extent necessary to meet any
obligations incurred in connection with the Transition Entities
Agreements, Mr. Patton tells Judge Sontchi.  However, he assures
the Court that the only sources of funding would be the revenues
and working capital of the Servicing Business.

Mr. Patton argues, among other things, that as provided in the
APA, AHM Acquisition, and not the bankruptcy estates:

   -- bears all of the upside benefit and downside risk of the
      Servicing Business.

   -- is responsible for providing the necessary working capital
      to fund the Servicing Business; and

   -- is ultimately responsible for the operating expenses of the
      Servicing Business.

In addition, the Debtors ask the Court to shorten the notice
applicable to their request, reducing the time by which
interested parties must respond to the request.  They ask Judge
Sontchi to commence a hearing on Friday, Jan. 4, 2008, at
11:00 a.m., to consider the request.

                       About American Home

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 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 March 3, 2008.  (American Home Bankruptcy
News, Issue No. 21, Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ANGIOTECH PHARMACEUTICALS: S&P Holds B- Corporate Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed the ratings, including
the 'B-' long-term corporate credit rating, on Vancouver-based
Angiotech Pharmaceuticals Inc. and removed them from CreditWatch
with negative implications, where they were placed Oct. 22, 2007.
The outlook is negative.

"The affirmation reflects our expectation that the company has
sufficient cash to support its operations in the medium term, even
if revenue growth is stagnant," said Standard & Poor's credit
analyst Maude Tremblay.

The ratings on Angiotech reflect its continued high dependence on
the challenged drug-eluting stent (DES) market for its operating
performance, uncertainty regarding the timing and extent of
revenue growth from new products, as well as expected negative
free cash flow generation in the medium term.  The company's
leading position within the DES market, a pipeline of
products that have the potential to improve and diversity the
company's revenue stream, and sufficient liquidity to meet its
obligations in the medium term partially offset these factors.

Angiotech is a specialty pharmaceutical company whose core
strength is adding pharmaceutical compounds to medical devices
used by surgeons.  A licensing agreement with Boston Scientific
Corp. for the Taxus DES, from which Angiotech receives royalty
revenues, is the company's most important revenue generator.   Due
to recent demand decline, Taxus royalties now represent about 40%
of the company's last 12 months revenues (at Sept. 30, 2007).  The
medical products segment, resulting mostly from the American
Medical Instruments Inc. acquisition in March 2006, manufactures
and markets a wide range of single-use specialty medical products
directly to end-users.  The company is also investing to research
and develop new products linked to surgical procedures; however,
these have yet to provide material revenue contribution.

Third-quarter royalty payments from BSX declined by 41% year-over-
year to $24.9 million, and S&P expects them to contract by about
20% in fourth-quarter 2007 compared with the same period in 2006.
Increased competition could cause a further decrease in Taxus
royalties of double digits annually in the medium term.  The
medical products segment underperformed management's expectations
during third-quarter 2007: products acquired from AMI generated
stable revenues; however, new products have yet to make material
contributions.  As a result, lease-adjusted EBITDA declined to
$63.3 million for the 12 months ended Sept. 30, 2007, compared
with $99.0 million for the 12 months ended Dec. 31, 2006.

The company's ability to generate free cash flow is under severe
constraints, given the deterioration of the operating performance
and interest expense of about $50 million annually.   Funds from
operations were only $3.1 million year-to-date at Sept. 30, 2007,
which was sufficient to cover the company's limited investments in
working capital and long-term assets in that period.  However S&P
expects free operating cash flow to become negative during fourth-
quarter 2007.

The negative outlook reflects S&P's expectation that Angiotech
will remain free cash flow negative for several quarters.  S&P
could lower the rating if weakening market conditions for DES or
setbacks in the product pipeline lead to a cash burn in excess of
$25 million annually.  Conversely, S&P could revise the outlook to
stable if contribution from new products or divestment of assets
leads to an improvement in free cash flow generation.


ASCENDIA BRANDS: Senior Lenders Waive Default Until February 28
---------------------------------------------------------------
Ascendia Brands Inc. has reached agreement with its senior lenders
to restructure its $160 million first and second lien debt
facilities.  Under the agreement, Ascendia's senior lenders will
waive certain existing covenant defaults and adjust financial
covenant levels from now through the end of Ascendia's fiscal year
ending Feb. 28, 2009.

As reported in the Troubled Company Reporter on Dec. 17, 2007,
Ascendia Brands Inc. notified its senior lenders that it is
in default of certain covenants contained in its first and second
lien credit facilities and is unable to make certain
representations and warranties deemed to be made when drawings are
made under its revolving credit facility.

On Dec. 12, 2007, the company received notice from the agent for
the first lien lenders reserving such lenders' rights under the
first lien facility generally, including the right to cease making
advances under the revolving credit facility.

In connection with the restructuring of Ascendia's senior debt,
one or more affiliates of Prentice Capital Management LP will make
an investment in convertible preferred equity securities of
Ascendia.  The aggregate investment of $26.5 million includes the
conversion of a $2 million unsecured loan made by Prentice on
Nov. 19, 2007.

Closing of the debt re-structuring and equity funding is subject
to the completion of definitive transaction documents and their
approval by Ascendia's board of directors, provision of a fairness
opinion and other customary closing conditions.  The parties
expect that the transaction will close, and funding will occur, on
or around Jan. 14, 2008.  However, closing of the transaction
cannot be assured.

"We are very pleased to have reached agreement in principle with
our lenders on the restructuring of our debt," Steven R. Scheyer,
president & chief executive officer of Ascendia, commented.  "We
now look forward to starting 2008 on a high note as we prepare to
roll out our exciting new the healing garden(R: 47.01, -0.50, -
1.05%) product line."

                      About Ascendia Brands

Headquartered in Hamilton, New Jersey, Ascendia Brands Inc. --
http://www.ascendiabrands.com/-- (AMEX: ASB) fka Cenuco Inc.
manufactures, markets and sells known branded products in the
health and beauty care categories.  The company's portfolio
includes Baby Magic(R), Binaca(R), Mr. Bubble(R), Calgon(TM), the
healing garden(R), Lander(R), Lander essentials(R), Ogilvie(R),
Tek(R), Dorothy Gray(R) and Tussy(R).  The company sells its
products through a variety of channels, concentrating primarily on
the mass merchandiser, drug, grocery and dollar store outlets.
The company operates two manufacturing facilities, in Binghamton,
New York, and Toronto, Canada.


ASSET BACKED FUNDING: Fitch Junks Ratings on Two Certificates
-------------------------------------------------------------
Fitch Ratings has taken these rating actions on these Asset Backed
Funding Corp. mortgage pass-through certificates:

Series 2004-FF1

  -- Class M-1 affirmed at 'AA-';
  -- Class M-2 affirmed at 'BBB+';
  -- Class M-3 affirmed at 'BBB-';
  -- Class M-4 downgraded to 'B' from 'BB+';
  -- Class M-5 downgraded to 'CC/DR4' from 'BB';
  -- Class M-6 downgraded to 'C/DR4' from 'BB-'.

Series 2004-OPT1

  -- Class M-1 affirmed at 'AA+';
  -- Class M-2 affirmed at 'A+';
  -- Class M-3 affirmed at 'A';
  -- Class M-4 affirmed at 'A-';
  -- Class M-5 affirmed at 'BBB+';
  -- Class M-6 downgraded to 'B' from 'BBB'.

The affirmations reflect a satisfactory relationship between
credit enhancement and future loss expectations and affect
approximately $128.06 million of outstanding certificates, as of
the December 2007 distribution date.

The negative rating actions total $11.49 million of outstanding
certificates and reflect the deterioration of credit enhancement
relative to future expected losses.

The transactions are seasoned from a range of 40 months (series
2004-FF1) to 46 months (series 2004-OPT1).  The pool factors
(current mortgage loan principal outstanding as a percentage of
the initial pool) range from 12% (series 2004-FF1) to 14% (series
2004-OPT1).  The cumulative losses to date, as a percentage of the
pools' initial balances, range from 0.78% (series 2004-FF1) to
0.94% (series 2004-OPT1).

For the transactions listed above, the underlying collateral
consists of fixed-rate and adjustable-rate mortgage loans secured
by first and second liens on residential mortgage properties
extended to subprime borrowers.  The mortgage loans were
originated by First Franklin Financial Corporation (series 2004-
FF1) and Option One Mortgage Corporation (series 2004-OPT1).

The servicers for the loans in these transactions are Option One
Mortgage Corporation (series 2004-OPT1) and Countrywide Home
Loans, Inc. (series 2004-FF1).  Option One is rated 'RPS2+', with
a Negative Rating Watch by Fitch, and Countrywide Home Loans, Inc.
is rated 'RPS1-', with an Evolving Rating Watch.

For the 2004-FF1 transaction, the overcollateralization is below
the stepped-down target of $3,615,935.  The 60+ delinquencies are
14.70% of the current collateral balance, which includes real
estate owned of 8.5%.

For the 2004-OPT1 transaction the OC is $162,419, which is well
below the target of $2,214,022.  The 60+ delinquencies are 16.82%
of current collateral balance.  This includes foreclosures and REO
of 7.1% and 3.5%, respectively.


ATARI INC: Has Until March 20 to Comply with Nasdaq Listing Rules
-----------------------------------------------------------------
Atari Inc. has received a notice from The Nasdaq Stock Market
advising that in accordance with Nasdaq Marketplace Rule
4450(e)(1), Atari Inc. has 90 calendar days, or until March 20,
2008, to regain compliance with the minimum market value of Atari
Inc.'s publicly held shares required for continued listing on the
Nasdaq Global Market, as stated in Nasdaq Marketplace Rule
4450(b)(3).

Atari Inc. received the notice because the market value of its
publicly held shares, which is calculated by reference to Atari
Inc.'s total shares outstanding, less any shares held by officers,
directors or beneficial owners of 10% or more, was less than
$15 million for 30 consecutive business days prior to Dec. 21,
2007.  This notification has no effect on the listing of Atari
Inc.'s common stock at this time.

The notice letter also states that if, at any time before
March 20, 2008, the market value of Atari Inc.'s publicly held
shares is $15 million or more for a minimum of 10 consecutive
trading days, the Nasdaq staff will provide Atari Inc. with
written notification that it has achieved compliance with the
minimum market value of publicly held shares rule.

However, the notice states that if Atari Inc. cannot demonstrate
compliance with such rule by March 20, 2008, the Nasdaq staff will
provide Atari Inc. with written notification that its common stock
will be delisted.

In the event that Atari Inc. receives notice that its common stock
will be delisted, Nasdaq rules permit Atari Inc. to appeal any
delisting determination by the Nasdaq staff to a Nasdaq Listings
Qualifications Panel.

                         About Atari Inc.

Headquartered in New York, Atari Incorporated, (NASDAQ: ATAR) --
http://www.atari.com/-- develops interactive games for all
platforms and is a third-party publisher of interactive
entertainment software in the U.S.  Atari Inc. is a majority-owned
subsidiary of France-based Infogrames Entertainment SA, an
interactive games publisher in Europe.

                       Going Concern Doubt

New York-based Deloitte & Touche LLP expressed substantial doubt
about Atari's ability to continue as a going concern after
auditing the company's consolidated financial statements for the
year ended March 31, 2007.  The auditing firm pointed to the
company's significant operating losses.


BALLY TECHNOLOGIES: Earns $21 Mil. in Quarter Ended September 30
----------------------------------------------------------------
Bally Technologies, Inc. financial results for the fiscal quarter
ended Sept. 30, 2007.

Net income increased to $21.2 million, or 11% of total revenue,
compared with a net loss of $225,000 in the same period last year,
as a result of improved margin and cost leverage.

Total revenues increased 23% to $189.0 million as compared with
$153.7 million for the same period last year.

"We are very pleased with our continued improvement in both
business momentum and margins in all the key parts of our
business," Richard M. Haddrill, the Company's Chief Executive
Officer, said.

Cash and cash equivalents increased to approximately $51.6 million
at Sept. 30, 2007 as compared with approximately $40.8 million at
June 30, 2007.

Selling, general and administrative expenses increased 6% to
$52.3 million and declined to 28% of total revenue from 32 percent
as compared with the same period last year.

Adjusted EBITDA was $58.5 million, a 122% increase as compared
with the same period last year.

The company made an unscheduled $15.0 million payment on its term
loan during the first quarter of fiscal 2008.

"In addition to improving our margins, the quarterly results also
reflect our improving operating leverage," Robert C. Caller, the
Company's Chief Financial Officer, said.  "Our SG&A and R&D
expenses were favorably impacted by better control over costs and
savings from our India Development Centers."

At Sept. 30, 2007, the company's balance sheet showed total assets
of $871.0 million and total liabilities of $647.2 million,
resulting in $222.5 million stockholders' equity.  Equity, at June
30, 2007, was $199.4 million.

                  About Bally Technologies Inc.

Headquartered in Las Vegas, Nevada, Bally Technologies Inc.
(NYSE:BYI) - http://www.ballytech.com/-- is engaged in the
design, manufacture, assembly and distribution of technology based
products to commercial gaming markets.  The company's business
consists of two business units: the Bally Gaming and Systems
business unit and the Rainbow Casino (Rainbow) business unit.  The
Bally Gaming and Systems unit consists of three primary sub-
groups: Gaming Equipment, which includes the sale of gaming
devices; Gaming Operations, which includes the rent and lease of
gaming devices, and Systems, which includes the sale and support
of gaming systems. It also owns and operates the Rainbow Casino in
Vicksburg, Mississippi.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 28, 2007,
Fitch Ratings upgraded Bally Technologies' Issuer Default Rating
and senior secured bank debt ratings as: IDR to 'B' from 'B-' and
Secured bank credit facilities to 'BB/RR1' from 'B/RR3'.


BANK OF AMERICA: Fitch Puts Low-B Ratings on Six Certificates
-------------------------------------------------------------
Bank of America Commercial Mortgage Inc., series 2007-5,
commercial mortgage pass-through certificates are rated by Fitch
Ratings:

  -- $25,000,000 class A-1 'AAA';
  -- $77,000,000 Class A-2 'AAA';
  -- $281,000,000 Class A-3 'AAA';
  -- $48,322,000 Class A-SB 'AAA';
  -- $612,000,000 Class A-4 'AAA';
  -- $257,694,000 Class A-1A 'AAA';
  -- $185,850,000 Class A-M 'AAA';
  -- $139,405,000 Class A-J 'AAA';
  -- $1,858,595,583 Class XW 'AAA';
  -- $20,909,000 Class B 'AA+';
  -- $13,939,000 Class C 'AA';
  -- $20,909,000 Class D 'AA-';
  -- $18,585,000 Class E 'A+';
  -- $11,616,000 Class F 'A';
  -- $18,585,000 Class G 'A-';
  -- $20,909,000 Class H 'BBB+';
  -- $16,262,000 Class J 'BBB';
  -- $18,585,000 Class K 'BBB-';
  -- $11,616,000 Class L 'BB+';
  -- $6,969,000 Class M 'BB';
  -- $4,646,000 Class N 'BB-';
  -- $6,969,000 Class O 'B+';
  -- $2,323,000 Class P 'B';
  -- $4,646,000 Class Q 'B-'.

Class XW is a notional amount and interest only.  The $34,856,583
class S is not rated by Fitch.

All classes are privately placed pursuant to rule 144A of the
Securities Act of 1933.  The certificates represent beneficial
ownership interest in the trust, primary assets of which are 100
fixed-rate loans having an aggregate principal balance of
approximately $1,858,595,583, as of the cutoff date.


BEAR STEARNS: Fitch Assigns Low-B Ratings on Six Certificates
-------------------------------------------------------------
Fitch rates Bear Stearns Commercial Mortgage Securities Trust
2007-PWR18, commercial mortgage pass-through certificates:

  -- $74,891,059 class A-1 'AAA';
  -- $291,900,000 class A-2 'AAA';
  -- $269,700,000 class A-3 'AAA';
  -- $131,900,000 class A-AB 'AAA';
  -- $709,998,000 class A-4 'AAA';
  -- $272,415,000 class A-1A 'AAA';
  -- $211,557,000 class A-M 'AAA';
  -- $38,916,000 class AM-A 'AAA';
  -- $182,468,000 class A-J 'AAA';
  -- $33,566,000 class AJ-A 'AAA';
  -- *$2,502,224,530 class X-1 'AAA'.
  -- *$2,442,815,000 class X-2 'AAA';
  -- $25,047,000 class B 'AA+';
  -- $25,047,000 class C 'AA';
  -- $18,786,000 class D 'AA-';
  -- $25,047,000 class E 'A+';
  -- $18,786,000 class F 'A';
  -- $25,047,000 class G 'A-';
  -- $21,916,000 class H 'BBB+';
  -- $18,786,000 class J 'BBB';
  -- $25,047,000 class K 'BBB-';
  -- $9,393,000 class L 'BB+';
  -- $9,393,000 class M 'BB';
  -- $9,392,000 class N 'BB-';
  -- $6,262,000 class O 'B+';
  -- $3,131,000 class P 'B';
  -- $3,131,000 class Q 'B-';
  -- $40,702,471 class S 'NR'.

*Notional amount and interest only

Classes A-1, A-2, A-3, A-AB, A-4, A-1A, A-M, AM-A, A-J and AJ-A
are offered publicly while classes X-1, X-2, B, C, D, E, F, G, H,
J, K, L, M, N, O, P, Q, and S are privately placed pursuant to
Rule 144A of the Securities Act of 1933.  The certificates
represent beneficial ownership interest in the trust, primary
assets of which are 185 fixed- or floating-rate loans having an
aggregate principal balance of approximately $2,502,224,530, as of
the cutoff date.


BFA LIQUIDATION: To Sell Arizona Land at Absolute Public Auction
----------------------------------------------------------------
On Jan. 17, 2007, the BFA Liquidation Trust will sell its
remaining real estate parcels located in the State of Arizona at
absolute public auction -- to the highest and final bidders.  Sale
of the Trust's land will further assist in recovering debt
from the bankrupt Baptist Foundation of Arizona.

At one time, the Baptist Foundation of Arizona controlled a
portfolio of over $500 million in holdings.  In 1999, the Arizona
Corporation Commission's Securities Division found evidence that
the foundation's officers used fraudulent transactions in the last
decade to conceal real estate losses.  Also cited were poor
investment decisions, deceptive accounting and a high overhead.
That resulted in bad information about the condition of the BFA
when talking to potential investors.

As a part of the ensuing bankruptcy case, the BFA Liquidation
Trust was created to convert the assets and allow for the
settlement to the investors.

Clifton R. Jessup, Jr. has been serving as the Liquidating Trustee
working in conjunction with the Trust.  Southwest Real Estate
Auctioneers of Phoenix, AZ has been retained by the BFA
Liquidation Trust to conduct the auction event at which their
properties and a few other select parcels located throughout
Maricopa County will be sold at the Phoenix Sheraton Crescent
Hotel.

For more information, contact Southwest Real Estate Auctioneers at
1-800-895-9064 or visit their website at www.swreauctioneers.com/

Headquartered in Phoenix, Arizona, BFA Liquidating Trust --
http://www.bfaz.org/-- is the successor to the Baptist Foundation
of Arizona, a non-profit organization that sold real-estate
investments to 13,000 mostly elderly Christians.


BOISE PAPER: S&P Pairs BB- Corporate Rating With Stable Outlook
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating and stable outlook to Boise Paper Holdings LLC.
At the same time, S&P assigned its bank loan and recovery ratings
to Boise's proposed $975 million first-lien credit facilities and
$200 million second-lien term loan.

The first-lien facilities were assigned a 'BB+' senior secured
bank loan rating, two notches above the corporate credit rating,
and '1' recovery rating, indicating expectation of very high (90%-
100%) recovery in the event of a payment default.
Concurrently, S&P assigned its 'B' senior secured bank loan
rating, two notches below the corporate credit rating, and '6'
recovery rating to the company's $200 million second-lien term
loan.  The recovery rating indicates that lenders can expect
negligible (0%-10%) recovery in the event of a payment default.
These ratings are based on preliminary terms and conditions.

Proceeds from the proposed credit facilities, along with about
$400 million of cash and $325 million of common shares, will be
used by Aldabra 2 Acquisition Corp. to acquire the paper,
packaging, and newsprint divisions of Boise Cascade LLC for about
$1.6 billion.  Boise Cascade will still own about 40% of Boise.
The transaction is expected to close in February 2008.

"The ratings on Boise reflect its participation in the cyclical
paper and packaging markets, moderate size and lower profitability
relative to other leading paper producers, customer concentration
risk, and aggressive pro forma debt leverage," said Standard &
Poor's credit analyst Pamela Rice.  "The ratings also incorporate
moderate product diversity, a growing value-added product mix, and
prospects for good market conditions in the near term."

Boise, Idaho-based Boise is the third-largest producer of uncoated
free sheet in North America, with a market share of about 11%.  It
also manufactures containerboard, corrugated products, and
newsprint.


CAM CBO: Review Cues Fitch to Change Rating to C/DR6 from C/DR4
---------------------------------------------------------------
Fitch has revised the Distressed Recovery rating on one class of
notes issued by CAM CBO I, Ltd.  This revision is a result of
Fitch's review process and is effective immediately:

  -- $39,676,494 class C notes to 'C/DR6' from 'C/DR4'.

CAM CBO is a collateralized debt obligation managed by Conning
Asset Management which closed Nov. 13, 1998.  CAM CBO is composed
of mainly high yield bonds.

The class C notes have failed to receive full periodic interest
and the interest shortfall has been capitalized and is expected to
continue to do so.  In addition, ultimate principal recovery of
the class C notes will likely be nominal.  The DR rating takes
into account both expected future interest distributions as well
as any principal recovery.

The remaining portfolio includes approximately $12 million par
amount of defaulted assets and various equity positions.  To date,
the class C notes have capitalized approximately $18 million
missed interest payments on the original balance of $21 million.
The ratings of the class C notes address the likelihood that
investors will receive ultimate and compensating interest
payments, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date.


NEW ORLEANS SEWERAGE: Moody's Maintains Ba2 Debt Rating
-------------------------------------------------------
Moody's Investors Service affirmed the Ba2 rating and changed the
outlook to positive from negative on the City of New Orleans
Sewerage and Water Board's revenue debt.  The Ba2 and positive
outlook affect $206 million in sewer revenue debt and $44 million
in water revenue debt outstanding.  Debt is secured by net
revenues of each respective system.

The rating was lowered to Ba2 in November of 2005 following
Hurricane Katrina.  The change in the outlook to positive from
negative reflects more favorable revenue results than anticipated
and State and Federal funding which have bolstered financial
operations following Hurricane Katrina.  The outlook also reflects
water rate increases that were recently adopted by the Sewerage
and Water Board.  The Ba2 rating continues to take into
consideration a decreased customer base, which exists from the
wholesale out-migration of population as a result of the
hurricane, thereby resulting in decreased system revenues.

      Long Term Debt Issued Through Board of Liquidation

All long term debt issued by the W&S Board has been issued through
the Board of Liquidation and is insured.  Moody's believes the
Board of Liquidation provides additional bondholder protection
given its authority to raise rates and its autonomy as an
independent Board.  The S&W Board is mandated by statute to
increase rates necessary to produce 1.30 times debt service
coverage from net revenues.  Should the S&W Board not implement
such rates, the Board of Liquidation has the authority to compel
it to do so.  The Board is currently working with outside
consultants to determine what rate increases may be necessary.
The Board of Liquidation maintains reserves able to meet an annual
debt service requirement, on behalf of the sewerage and water
board; however, the reserves have not been utilized, even after
the storm, as service fees were sufficient to meet debt service
needs.

              Actual Revenues Better than Budgeted

The Ba2 reflects ongoing concerns regarding a projected slow
revenue recovery.  Water revenue collections in fiscal 2006 were
38% below 2004 (which represents the last "normal" fiscal year
prior to Katrina) while sewer service charges in fiscal 2006 were
13% below 2004.  After the devastation from Hurricane Katrina,
management adopted a very conservative budget for fiscal 2006
assuming only 30% of prior year revenues would be collected.
However, actual results were better than anticipated and the
$33.8 million in water service charges exceeded the budget by 99%.
Sewer revenues exceeded the budget by 112% with $62.6 million
total collected.  Management reports customer loss is
approximately 26,000 but that water usage remains strong given
ongoing rebuilding efforts.  Additionally, residents who are
rebuilding are adding additions such as bathrooms and/or pools
which help to increase overall usage.

The Board also received significant funding from State and Federal
sources in fiscal years 2005, 2006 and 2007.  FEMA will be
reimbursing the Board for infrastructure improvements that are
necessary as a result of storm damage.

To-date, the Board has received approximately $113 million in
reimbursements.  The Board also received $61.9 million from the
Federal Community Disaster Loan program and this entire amount has
been drawn down since April of 2007.  Moody's is waiting to see
the results of proposed legislation which would allow the
government to forgive this loan.  Although the Board is prepared
to repay the CDL loan, forgiveness of the loan would afford them
some financial flexibility in the future.  The State provided $73
million in Gulf Opportunity Zone funding to support debt service
requirements for the water and sewer systems and the State has
also established a $100 million revolving fund for the Board to
access for cash needs.  These combined external funding sources
have allowed the Sewerage and Water Board to continue daily
operations and have allowed the Board to meet debt service
requirements with service charges.

  Strong Management Expected to Continue; Challenges Remain
                        for the Long-Term

The Ba2 rating and positive outlook also reflect the S&W Board's
demonstrated ability to fund normal operations, at least for the
immediate future with service charges that are being collected on
a daily basis.  Management at the utility is strong and has
historically demonstrated prudent fiscal management.  For example,
interim financial statements and a three-month proforma are
prepared and presented to the Board on a monthly basis.  Moody's
believes strong management will continue and will manage through
the multiple challenges that they face; however, it will take time
and could take years to recover and stabilize operations.
Management indicates that they are in compliance with all existing
EPA requirementes regarding the outstanding consent decree.

In November of 2007, the Board adopted multiple year water rate
increases: 17% effective July 1, 2008, 5% in 2009, 5% in 2010 and
4% in 2011.  The rate increases are based on a rate study
conducted by an outside consultant in 2005 but were adjusted in
2007 based on the new customer base.  Moody's believes that actual
results on the revenues of the water system will be positive and
could result in upward pressure on the Ba2 rating.

                             Outlook

The positive outlook reflects better than anticipated financial
results for the 2006 fiscal year end.  The outlook also takes into
consideration water rate increases which will support revenue
growth and stability in the system.


CONSOLIDATED COMMS: Closes $362.6M North Pittsburgh Systems Buyout
------------------------------------------------------------------
Consolidated Communications Holdings Inc. has completed its
acquisition of North Pittsburgh Systems Inc. for approximately
$362.6 million, based upon the closing price of Consolidated's
common stock on Dec. 28, 2007.  The acquired company will operate
in Pennsylvania under the Consolidated Communications brand name.

"We are excited to complete this transaction and are looking
forward to the opportunities that lie ahead," Bob Currey,
Consolidated's President and Chief Executive Officer, said.  "We
have said from the start that North Pittsburgh has a strong
network that, when coupled with Consolidated's back office
platforms and technical experience, can be leveraged to roll out
enhanced broadband services.  We plan to launch our IPTV product
in the North Pittsburgh area in the first quarter of 2008 and
expect to pass approximately 12,000 homes at that time.  By the
end of 2008, we anticipate passing a total of approximately 34,000
homes."

The merger agreement provided that North Pittsburgh shareholders
could elect to receive either $25.00 in cash, without interest, or
1.1061947 shares of Consolidated common stock for each share of
North Pittsburgh common stock, subject to proration so that 80
percent of the North Pittsburgh shares are exchanged for cash and
20 percent are exchanged for stock.  Consolidated also announced
the preliminary results of elections made by North Pittsburgh
shareholders and the preliminary effect of proration.  Of the
15,005,000 shares of North Pittsburgh common stock outstanding
immediately prior to closing the merger, approximately:

   -- 13,378,590 shares, or 89.2 percent, elected to receive cash;

   -- 1,361,806 shares, or 9.1 percent, elected to receive stock;

   -- 264,604 shares, or 1.8 percent, did not make an effective
      election.

As a result, on a preliminary basis, North Pittsburgh shares as to
which a stock election was made will receive Consolidated common
stock; North Pittsburgh shares as to which a cash election was
made will receive cash for approximately 89.73% of those shares
and Consolidated common stock for the remainder; and shares with
respect to which no effective election was made will receive
Consolidated common stock.  Consolidated will not issue any
fractional shares of stock and, instead, each North Pittsburgh
shareholder immediately prior to the merger who would otherwise be
entitled to a fractional share of Consolidated common stock (based
on the total stock consideration into which the holder's North
Pittsburgh shares have been converted in the merger) will receive
an amount in cash equal to $18.53 multiplied by the fractional
share interest to which the shareholder would otherwise be
entitled.

                About Consolidated Communications

Based in Mattoon, Illinois, Consolidated Communications Holdings,
Inc. -- http://www.consolidated.com/-- is a rural local exchange
company providing voice, data and video services to residential
and business customers in Illinois and Texas.  Each of the
operating companies has been operating in their local markets for
over 100 years.  With approximately 241,000 local access lines and
over 43,000 digital subscriber lines, the Company offers a wide
range of telecommunications services, including local and long
distance service, custom calling features, private line services,
dial-up and high-speed Internet access, digital TV, carrier access
services, and directory publishing. Consolidated Communications is
the 17th largest local telephone company in the United States.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 19, 2007,
Moody's Investors Service affirmed the B1 corporate family rating
for Consolidated Communications Holdings Inc. and assigned a B1
rating to the proposed $950 million senior secured credit
facilities at the company's direct subsidiaries, Consolidated
Communications Acquisition Texas Inc., Consolidated Communications
Inc., and Fort Pitt Acquisition Sub Inc.

Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Consolidated Communications Holdings Inc. and the
'BB' rating on the company's existing bank loan.  The outlook is
negative.


CONSULTING & SAFETY: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------------
Lead Debtor: Consulting & Safety Specialists, Inc.
             924 Lefort By-Pass Road
             Thibodaux, LA 70301

Bankruptcy Case No.: 07-12585

Debtor-affiliate filing separate Chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
        Benoit Properties, L.L.C.                  07-12586

Type of Business: The Debtor specializes in consulting and
                  training services on safety.  See
                  http://www.safetytrainingacademy.com

Chapter 11 Petition Date: December 28, 2007

Court: Eastern District of Louisiana (New Orleans)

Judge: Elizabeth W. Magner

Debtors' Counsel: Darryl T. Landwehr, Esq.
                  1010 Common Street, Suite 1710
                  New Orleans, LA 70112
                  Tel: (504) 561-8086
                  Fax: (504) 561-8089

                            Estimated Assets       Estimated Debts
                            ----------------       ---------------
Consulting & Safety         $1 Million to          $100,000 to
Specialists, Inc.           $10 Million            $500,000

Benoit Properties, L.L.C.   $1 Million to          $1 Million to
                            $10 Million            $10 Million

A. Consulting & Safety Specialists, Inc's 17 Largest Unsecured
   Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Dryades Savings Bank           Bank loan             $2,015,086
233 Carondelet Street
New Orleans, LA 70130

Cash Flow Resources            Bank loan             $262,000
1604 Oretha C. Haley
Boulevard
New Orleans, LA 70130

Internal Revenue Service       Trade debt            $200,000
423 Lafayette Street,
Suite 200
Tel: (985) 876-3140
Houma, LA 70360

Louisiana Department of        Trade debt            $42,000
Revenue

Lexington Insurance Co.        Trade debt            $26,000

D.K.S. Law Firm                Trade debt            $15,000

Petroleum Education Council    Trade debt            $14,000

Shell Fleet Card Processing    Trade debt            $13,000

Cananwill                      Trade debt            $13,000

United Healthcare              Trade debt            $11,000

State Farm                     Trade debt            $10,000

International Association of   Trade debt            $8,000
Drilling Contractors

U.S.I. Gulf Coast, Inc.        Trade debt            $8,000

Ramada Inn                     Trade debt            $8,000

Lafourche Parish Tax Assessor  Trade debt            $7,500

Coastal Training               Trade debt            $7,000

Ford Motor Credit              Bank loan; value of   $11,000
                               collateral: $4,000

B. Benoit Properties, LLC's Two Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Lafourche Parish Sheriff's     $14,527
Office
P.O. Box 5608
Thibodaux, LA 70302-4431

Internal Revenue Service       $500
423 Lafayette Street,
Suite 200
Houma, LA 70360


CWMBS INC: Fitch Rates $2,747,200 Class B-3 Certificates at BB
--------------------------------------------------------------
Fitch rates CWMBS, Inc.'s mortgage pass-through certificates, CHL
mortgage pass-through trust 2007-21 are:

  -- $759,390,236 classes 1-A-1 through 1-A-3, 1-X, 1-PO, 2-A-1
     through 2-A-3, 2-X, 2-PO and A-R certificates (senior
     certificates) 'AAA';

  -- $12,951,000 class M certificates 'AA';

  -- $3,924,500 class B-1 certificates 'A';

  -- $1,962,300 class B-2 certificates 'BBB';

  -- $2,747,200 non-offered class B-3 certificates 'BB';

  -- $785,000 non-offered class B-4 certificates 'B'.

The 'AAA' rating on the senior certificates reflects the 3.25%
subordination provided by the 1.65% class M, the 0.50% class B-1,
the 0.25% class B-2, the 0.35% non-offered class B-3, the 0.10%
non- offered class B-4 and the 0.40% non-offered class B-5.
Classes M, B-1, B-2, B-3, and B-4 are rated 'AA', 'A', 'BBB',
'BB', and 'B' based on their respective subordination only.

Fitch believes the above credit enhancement will be adequate to
support mortgagor defaults.  In addition, the rating also reflects
the quality of the underlying mortgage collateral, strength of the
legal and financial structures and the master servicing
capabilities of Countrywide Home Loans Servicing LP, rated 'RMS2+'
by Fitch, a direct wholly owned subsidiary of Countrywide Home
Loans, Inc.

This transaction contains certain senior classes designated as
exchangeable certificates and others as depositable certificates.
The classes 1-A-3 and 2-A-3 are exchangeable certificates.  The
remainder of the senior classes are depositable certificates.  The
exchangeable and depositable certificates may be exchanged in
certain combinations per Annex I of the Prospectus Supplement.

The mortgage pool consists of two separate loan groups.  All loans
are secured by first liens on one- to four-family residential
properties.  Group 1 consists of 966 primarily 30-year
conventional, fixed-rate mortgage loans.  As of the cut-off date,
Dec. 1, 2007, the total mortgage pool balance is $556,925,334, the
average mortgage pool balance is $576,527, with an approximate
weighted-average original loan-to-value ratio of 72.24%.  The
weighted average FICO credit score is approximately 744.  Cash-out
refinance loans represent 17.76% of the mortgage pool and second
homes 7.09%.  The states that represent the largest portion of
mortgage loans are California (43.11%), Florida (5.54%) and New
York (5.01%).  All other states represent less than 5% of the pool
as of the cut-off date.  Group 1 will have a prefunding amount
equal to $146,974,666.

Group 2 consists of 90 primarily 15-year conventional, fixed-rate
mortgage loans.  As of the cut-off date the total mortgage pool
balance is $74,999,956, the average mortgage pool balance is
$833,333, with an approximate OLTV of 65.63%.  The weighted
average FICO credit score is approximately 752.  Cash-out
refinance loans represent 22.86% of the mortgage pool and second
homes 13.28%.  The states that represent the largest portion of
mortgage loans are California (43.87%), New York (7.30%), New
Jersey (7.13%), Florida (6.17%), and Texas (6.02%).  All other
states represent less than 5% of the pool as of the cut-off date.
Group 2 will have a prefunding amount equal to $6,000,004.

CWMBS purchased the mortgage loans from CHL and deposited the
loans in the trust, which issued the certificates, representing
undivided beneficial ownership in the trust.  The Bank of New York
will serve as trustee.  For federal income tax purposes, an
election will be made to treat the trust fund as one or more real
estate mortgage investment conduits.


DANA CORP: 24 Investor Groups to Buy $540 Million New Dana Shares
-----------------------------------------------------------------
Dana Corp. and its debtor-affiliates sought and obtained
permission from the U.S. Bankruptcy Court for the Southern
District of New York to file an Allocation Report, indicating
Participating Claims totaling more than $1.5 billion that were
allocated 5.4 million shares of New Series B Preferred Stock on a
pro rata basis, under seal.

Dana entered into an Investment Agreement dated July 26, 2007,
with Centerbridge Capital Partners, L.P.; Centerbridge Capital
Partners Strategic, L.P., as successor by assignment from CBP
Parts Acquisition Co. LLC; Centerbridge Capital Partners SBS,
L.P., as successor by assignment from CBP Parts.

The Investment Agreement allows for $790 million cash infusion in
the Reorganized Debtors.  Centerbridge will purchase $250 million
in aggregate liquidation preference of New Series A Preferred
Stock and qualified creditors of the Debtors who are Qualified
Investors will have an opportunity to purchase an additional
$540 million in aggregate liquidation preference of New Series B
Preferred Stock on a pro rata basis.

To be permitted to invest to purchase a pro rata share of the
Series B Shares, the Investment Agreement required parties, among
other things, be a "Qualified Investor" under the Investment
Agreement and to deliver a duly executed Subscription Agreement
prior to 5:00 p.m. EST on Dec. 5, 2007.

To be a "Qualified Investor," a party was required, among other
things, to

   (a) beneficially own "Qualified Bond Claims," "Acquired Bond
       Claims" or "Qualified Trade Claims" in excess of
       $25 million by certain dates and

   (b) timely execute and deliver a signature page to the Plan
       Support Agreement dated July 26, 2007, among Dana, United
       Steelworkers, International Union, UAW, Centerbridge
       Capital Partners, L.P. and certain Dana creditors.

The BMC Group, Inc., as Subscription Agent for the Debtors, mailed
subscription agreements and instructions for subscription on
Nov. 2, 2007, to all parties that the Debtors reasonably believed
might be entitled to participate in the subscription based upon
information available at that time.

Corinne Ball, Esq., at Jones Day in New York, reports that as of
Dec. 26, 2007, BMC has received, excluding duplicates, 106
Subscription Agreements from 96 entities constituting 24 investors
-- if affiliated entities are counted as one investor.  BMC and
the Debtors have since undertaken to reconcile the information
that was submitted in the subscription agreements.

The Debtors have reviewed the information received by BMC and
other relevant information, which has been shared with counsel to
the Ad Hoc Committee of Dana Noteholders and counsel to the
Official Committee of Unsecured Creditors, Ms. Ball says.  Based
on the information and other numerous meetings at which they
consulted with the Ad Hoc Committee and the Creditors' Committee,
the Debtors have determined and have prepared a report setting
forth:

   (a) which parties will purchase Series B Shares as part of the
       subscription process; and

   (b) the number of Series B Shares to be allocated to each
       Subscribing Investor for purchase.

The Debtors believe that the allocation of New Series B Preferred
Stock is commercially sensitive information to them.  Publicly
disclosing the holdings of preferred shareholders is confidential
information that is not customarily disclosed unless and until
Securities Exchange Act of 1934 rules require the shareholder to
file with the Securities and Exchange Commission after crossing a
specified threshold of ownership percentage (generally 5%).  The
Debtors believe that publicly publishing the individual
allocations of New Series B Preferred Stock would only serve to
potentially cause delays in the Debtors' ability to obtain the
necessary funds.

In addition, counsel to the Ad Hoc Committee has advised the
Debtors that the Subscribing Investors prefer that their exact
holdings in New Series B Preferred Stock not be publicly disclosed
because such parties consider their individual allocated holdings
to be confidential commercial information.

A full-text copy of the redacted version of the Allocation Report
identifying each of the Subscribing Investors without identifying
the number of shares of New Series B Preferred Stock being
allocated to each party, is available at no charge at:

   http://bankrupt.com/misc/DANA_Subscribing_Investors.pdf

Ms. Ball relates the Debtors are providing individualized
notices to each Subscribing Investor of, among other things:

   (a) the number of shares of New Series B Preferred Stock
       allocated to them;

   (b) instructions for submitting payment for the shares by
       Dec. 28, 2007; and

   (c) information regarding additional documentation that must
       be completed prior to a Subscribing Investor's receipt of
       its allocated New Series B Preferred Stock.

                            About Dana

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

Dana has facilities in China in the Asia-Pacific, Argentina in
the Latin-American regions and Italy in Europe.

The company and its affiliates filed for chapter 11 protection
on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  As of
Aug. 31, 2007, the Debtors listed $6,878,000,000 in total assets
and $7,551,000,000 in total debts resulting in a total
shareholders' deficit of $673,000,000.

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

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

The Debtors filed their Joint Plan of Reorganization on Aug. 31,
2007.  On Oct. 23, 2007, the Court approved the adequacy of the
Disclosure Statement explaining their Plan.  The Court has set
Dec. 10, 2007, to consider confirmation of the Plan.  (Dana
Corporation Bankruptcy News, Issue No. 67; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000).


DELPHI CORP: Court Approves Sale of Steering Biz for for $447 Mil.
------------------------------------------------------------------
The Honorable Robert Drain of the U.S. Bankruptcy Court for the
Southern District of New York has authorized Delphi Corp. and its
debtor-affiliates to auction off their global steering and
halfshaft businesses, in accordance with the proposed bidding
procedures.

Pursuant to a Master Sale And Purchase Agreement dated Dec. 10,
2007, the Debtors have agreed to sell their steering business to
Steering Solutions Corp. for $447 million, subject to higher and
better offers.

Judge Drain agreed to to the Debtors' request to grant a break-up
fee and an expense reimbursement for Steering Solutions, noting
that the bidder was unwilling to commit to hold open its offer
for the Steering Business absent bid protections.  The Court,
however, held that, pursuant to an agreement by the Official
Committee of Unsecured Creditors, the Debtors, and Steering
Solutions,

   (i) the break-up fee will be reduced from $6 million to
       $5.5 million and

  (ii) Steering Solutions retain the right to seek an expense
       reimbursement in an amount up to $6 million if a break-up
       fee is not paid.

The Court denied Steering Holding, LLC's objection to the
proposed bid procedures.  Steering Holding had asked the Court
not to approve the Debtors' selection of Steering Solutions as
the stalking horse bidder on grounds that it intends to submit an
alternative bid, which would raise the cash portion of the
purchase price from $1 million to $10 million and would reduce the
break-up fees and expense reimbursements by $4 million.

The Court will convene a hearing on Feb. 21, 2008, at 10:00 a.m.,
Eastern time, to confirm the results of the auction, if any, and
approve the sale.

Headquartered in Troy, Michigan, Delphi Corporation (OTC: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology.  The company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  Delphi has regional headquarters
in Japan, Brazil and France.

The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors.  As of
March 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.

The Debtors' exclusive plan-filing period expires on Dec. 31,
2007.  On Sept. 6, 2007, the Debtors filed their Chapter 11 Plan
of Reorganization and a Disclosure Statement explaining that
Plan.  (Delphi Bankruptcy News, Issue No. 104; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)


DELPHI CORP: Ct. Extends Exclusive Plan-Filing Period to March 31
-----------------------------------------------------------------
The Honorable Robert Drain extends Delphi Corp. and its debtor-
affiliates':

   (a) exclusive period for filing a plan of reorganization
       through and including March 31, 2008; and

   (b) exclusive period for soliciting acceptance of that plan
       through and including May 31, 2008.

The Debtors' current Exclusive Plan Proposal Period expired on
Dec. 31, 2007.

As reported in the Troubled Company Reporter on Dec. 4, 2007, the
Debtors' good-faith progress towards reorganization, according to
John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, is most convincingly demonstrated
by the filing of the Joint Plan of Reorganization and Disclosure
Statement on Sept. 6, 2007.

The Debtors sought an extension of the Exclusive Periods to give
them sufficient time to complete the Plan solicitation and
confirmation processes in a timeframe that will allow them to
emerge from bankruptcy in the first quarter of 2008.

Headquartered in Troy, Michigan, Delphi Corporation (OTC: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology.  The company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  Delphi has regional headquarters
in Japan, Brazil and France.

The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors.  As of
March 31, 2007, the Debtors' balance sheet showed $11,446,000,000
in total assets and $23,851,000,000 in total debts.

The Debtors' exclusive plan-filing period expires on Dec. 31,
2007.  On Sept. 6, 2007, the Debtors filed their Chapter 11 Plan
of Reorganization and a Disclosure Statement explaining that
Plan.  (Delphi Bankruptcy News, Issue No. 102; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)


DIXIE GROUP: Moody's Withdraws Ratings for Business Reasons
-----------------------------------------------------------
Moody's Investors Service withdrew the ratings of The Dixie Group,
Inc. for business reasons.

These ratings have been withdrawn:

  -- Corporate Family Rating, rated B1;
  -- Probability of Default Rating, rated B1;
  -- $20 million 7% convertible subordinated debentures due
     2012, rated B3 (LGD 6, 92%).

Moody's last affirmed Dixie's ratings on Nov. 20, 2007.

Headquartered in Chattanooga, Tennessee, The Dixie Group, Inc.
is a leading manufacturer and marketer of carpets and rugs to
higher-end residential and commercial customers through the
Fabrica International, Masland Carpets and Dixie Home brands.
Founded in 1920 as a textile manufacturer, Dixie has since exited
the textiles business and is focused entirely on the floorcovering
market, selling to a diverse customer base through retailers,
designers, home builders and commercial end user channels.
Revenues are derived from residential floorcovering products
(66%), commercial floorcovering products (30%) and carpet yarn
products (4%).  Net revenues for the twelve months ended Sept. 29,
2007 were approximately $322 million.


DUKE ENERGY: Moody's Places Global Local Currency Rating at Ba2
---------------------------------------------------------------
Moody's Investors Service assigned a Ba2 Global Local Currency
corporate family rating with a stable outlook to Duke Energy
International, Geracao Paranapanema S.A.  In addition, Moody's
assigned an A1.br Brazil National Scale corporate family rating to
Duke.  This is the first time Moody's assigned a rating to Duke.
The rating is not constrained by Brazil's foreign currency country
ceiling.

Moody's assigned these ratings:

  -- Corporate Family Rating: Ba2;
  -- Brazil National Scale Corporate Family Rating: A1.br

Duke's rating reflects the company's solid capital structure
characterized by its low level of indebtedness, healthy debt
profile, steady cash generation and profitability.  This largely
stems from a 30-year concession contract granted in 1999, which
allows the company to operate in a relatively secure regulated
market with predictable profitability and cash flow.  Duke intends
to raise up to R$1 billion in debentures to redeem existing long-
term debt with Eletrobras, which is expected to improve its debt
profile and reduce the average cost of capital.

Currently, the company relies on medium-term energy supply
contracts equally divided between the regulated and unregulated
markets.  These contracts should generate predictable and stable
cash flows for the next four to five years, given their relatively
secure nature.  Almost half of Duke's revenues are in the
unregulated business segment, but the bulk of the company's client
portfolio is made up of large consumers with a solid credit track
record.  As contracts expire in the future, Duke is expected to
benefit from higher energy tariffs in light of current market
expectations of a continued low reserve margin in Brazil.
Expectations of higher energy tariffs are supported by recent
auctions for new energy in which prices have dramatically exceeded
prevailing market rates.

Generally, Moody's prefers regulated business segment revenues,
which generally are more predictable and allow for more stable
operating margins and cash flow.

Unregulated energy contracts expose Duke to potentially lower
energy prices and revenues in a scenario where future tariffs
decline, which Moody's considers unlikely.

Moody's rating has also taken into consideration the company's
outstanding commitment of increasing by 15% the installed
generation capacity in the state of Sao Paulo by the end of 2007,
as stated in its concession contract.

Duke's fulfillment of this commitment has not yet been recognized
by the regulator or the state of Sao Paulo.  Duke has had
difficulty in meeting this commitment because there are few sites
for new hydroelectric facilities in Sao Paulo and natural gas
shortages make new thermoelectric capacity a questionable
investment.  Duke has been discussing this situation with ANEEL
and the Government of the State of Sao Paulo and is reportedly
seeking to postpone the expansion obligation for another three
years.  The outcome and/or eventual penalties are difficult to
predict at this stage of discussions, but Moody's does not believe
that Duke's concession will be revoked since neither the current
hydrology nor natural gas constraints are within its power.

However, the rating is constrained by the potential increased
capital expenditures related to the fulfillment of this
commitment.  Additional capital expenditures could reach as much
as R$1 billion over a three to four year period without
jeopardizing Duke's ability to service its debt.  Moody's believes
that Duke would most likely finance a part of these investments
with additional debt, thus causing some deterioration in credit
metrics, but Moody's expects that they would remain appropriate
for the rating category, particularly if the current relatively
high dividend payout ratio were adjusted downward somewhat.

The rating incorporates Duke's current strong credit metrics,
which are in line with its local peer group and strong for the
rating category when compared with global peers, with FFO (Funds
from Operations) / Adjusted gross debt of 20.7% in 2006 and 25.9%
in the last twelve months ended Sept. 30, 2007 along with interest
coverage of over 3.0x for the last three years.   These two
metrics were impacted by a reduction in operating margins in 2006,
resulting from lower energy generation and increased taxes not
passed on to tariffs.  Moody's expects a sustainable improvement
in these metrics in light of higher energy tariffs in 2007
resulting from higher auction prices and improved terms with
unregulated customers.  The rating is constrained by the low level
of retained cash flow (Funds from Operations minus Dividends) to
Adjusted gross debt of approximately 10% in the past four years,
which is below peer group metrics.  Low retained cash flow results
from a high level of dividends paid to its parent company, which
is expected to remain a limiting factor for the rating in the
future.

Duke's cash flow as measured by FFO is expected to improve
somewhat from 2007 levels but remain stable thereafter up to 2010,
when approximately 30% of existing energy contracts matures.  This
expected turnover of available energy contracts would, most
likely, result in higher tariffs with a positive impact on cash
flow.  Duke's capital expenditures have been very limited when
compared to its peers at approximately R$30 million per annum,
which could eventually change should the company be obligated to
expand capacity to meet concession contract requirements.

The most important factor constraining the ratings is the
Brazilian regulatory framework, which has undergone substantial
change over the past several years and has a history of being
unpredictable.  The federal utility regulatory body in Brazil   is
part of the Brazilian government, which has a Ba1 foreign currency
and local currency bond rating.  Cost recovery and regulated
tariffs are currently undergoing a period of significant
uncertainty, due to ongoing reviews and revisions by the regulator
of existing asset and cost bases.  Potential future electricity
shortages due to a tight reserve margin, limited independence of
the regulator and minimal jurisprudence backing the new regulatory
framework were also taken into consideration in Moody's evaluation
of this factor.

Duke has adequate liquidity, with short-term debt of
R$143.6 million and cash and marketable securities of
R$137 million, in addition to positive free cash flow.

The bulk of short term debt is related to the current portion of
the long term Eletrobras'debt with a final maturity on May 15,
2013.  This debt is expected to be refinanced with a proposed
issuance of R$1 billion in debentures maturing in 2014 and 2016.

The stable outlook reflects Moody's expectation that Duke will
maintain strong credit metrics, but low free cash flow, due to a
high dividend pay-out ratio.  An upgrade in the rating would
require a resolution of the ongoing negotiation with regulators
and the state government with regard to the mandatory capacity
expansion clause in Duke's concession contract.  In addition, an
upgrade would require sustainable RCF/ Adjusted gross debt ratio
above 15% and interest coverage ratio above 3.5x.  An increased
likelihood of a stable regulatory environment could also be
positive for the ratings.

Downward rating pressure could result from higher than expected
capital expenditures and/or dividends or increased uncertainty
with regard to margins, such that it became likely that
RCF/Adjusted gross debt ratio would remain below 10%, and interest
coverage would remain below 2.0x for an extended period of time.

Duke Energy International, Geracao Paranapanema S.A is an
electricity generation company controlled by Duke Energy
Corporation, which indirectly holds 94.7% of its voting and total
capital.  The company has an installed capacity of 2,306 MW in
eight hydroelectric power plants along the Paranapanema river,
which represents approximately 2.3% of Brazil's total installed
capacity.  In the last twelve months ended Sept. 30, 2007, Duke
reported net sales of R$627 million ($309 million) and net profit
of R$83 million ($41 million).


DUNMORE HOMES: Gets Final OK to Borrow $1 Mil. from Sydney Dunmore
------------------------------------------------------------------
The Hon. Martin Glenn of the United States Bankruptcy Court for
the Southern District of New York has given its permission to
Dunmore Homes Inc. to borrow, on a final basis, funds of no more
than $1,000,000 from Sidney P. Dunmore pursuant to the terms and
conditions of the DIP Facility.

The Debtor is authorized to grant Mr. Dunmore the liens,
mortgages and security interests provided for under the DIP
Facility, the Court held.

Pursuant to Sections 362, 363(e), 364(c) and 503 of the
Bankruptcy Code, the Court ruled that the obligations under the
DIP Facility, including those under the DIP Financing Agreement,
are administrative expenses for which the Debtor is authorized to
grant to Mr. Dunmore, a valid, binding, enforceable and perfected
senior lien and security interest -- the DIP Lender's Lien --
subject to only to the Carve-out and to any valid lien existing
as of the Petition Date in any asset owned by the Debtor.

Each prepetition creditor holding a Prepetition Lien in assets
owned by the Debtor as of the bankruptcy filing date is granted
valid and binding Replacement Liens or security interests in the
Debtor's Collateral, subject to the Carve-out and junior to the
DIP Lender's Lien and the Prepetition Liens as adequate protection
for the Debtor's use of cash collateral.

Notwithstanding the liens, mortgages and security interest
granted under the Final DIP Order, the Collateral may be used by
the Debtor, if sufficient funds are not available from the
Debtor's estate to pay (i) fees to the U.S. Trustee pursuant to
Section 1930(a)(6) of the Judicial Procedures Code and fees
payable to the Bankruptcy Court Clerk; and (ii) the expenses of
Committee members and the reasonable fees and expenses of
professionals retained or employed by the Debtor or the Committee
in the Chapter 11 case.  The fees and expenses must not exceed
$100,000 in the aggregate.

Fees and expenses incurred in connection with any challenge to
the claims of or against the Lender will not be included in the
fees and expenses of the Carve-Out and may not be paid from any
funds borrowed under the DIP Facility, the Court clarified.

Mr. Dunmore, the DIP Lender, has a certain debt to the Debtor
under that certain Loan Agreement dated as of June 7, 2005 -- the
Lender Receivable.  The Court approved the modification of the
maturity date of the Lender Receivable by 15 days, for the
Lender's benefit, and reduction by 30 days of the time for the
Lender to notify the Debtor of any setoff with respect to the
Lender Receivable in connection with the release of escrowed
funds, for the Debtor's benefit, as provided in the DIP Financing
Agreement.

Moreover, upon the Lender's request, if the Debtor and the Lender
mutually agree that the Lender is entitled to an offset against
the Lender Receivable, upon 20 days' notice and opportunity to
object to the the 20 largest unsecured creditors, U.S. Trustee
and any special notice parties, the Court will approve that
determination.

The DIP Facility will be in effect pursuant to the Final DIP
Order until such time as all obligations to the Lender under the
DIP Facility are paid in full.  It is deemed an event of default
if the Debtor fails to pay the Obligations under the DIP
Financing Agreement by March 31, 2008.

The Final DIP Order is without prejudice to and fully reserves all
rights of Weyerhaeuser Realty Investors Inc., MW Housing
Partners III L.P. and WRI Communities Fund I LLC to assert:

   -- that Debtor Dunmore Homes Inc. does not own an equity
      interest in Dunmore Croftwood LLC, Dunmore Diamond Ridge
      LLC, Dunmore Highlands LLC and Dunmore Viscaya LLC;

   -- that the Joint Entities had no authority to execute any
      agreements without the consent of Weyerhaeuser;

   -- that the Joint Entities cannot sell, convey or transfer or
      encumber their assets and properties without the consent of
      Weyerhaeuser; and

   -- all other rights and remedies of Weyerhaeuser.

A full-text copy of the Dunmore Final DIP Order is available for
free at http://researcharchives.com/t/s?26af

As reported in the Troubled Company Reporter on Dec. 18, 2007,
The Official Committee of Unsecured Creditors in Debtor's
bankruptcy case asked the Bankruptcy Court to defer ruling on the
DIP Financing Motion until it has ruled on the venue transfer
request of Cal Sierra Construction Inc., et al.  The Committee
related that it has joined in Cal Sierra's request.

Because the outcome of the Court's ruling on the Venue Transfer
Motion may significantly impact the administration of Dunmore
Homes Inc.'s case, and may result in the transfer of the
Debtor's case to the Eastern District of California, it is
premature for the Court to rule on the DIP Motion, the Committee
asserted.

                       About Dunmore Homes

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.  The Official Committee of Unsecured Creditors has
selected Morrison & Foerster LLP as its counsel in this bankruptcy
proceeding.  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. 7; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


DUNMORE HOMES: Can Use Dunmore's Cash Collateral on a Final Basis
-----------------------------------------------------------------
The Hon. Martin Glenn of the United States Bankruptcy Court for
the Southern District of New York authorized Dunmore Homes Inc.,
on a final basis, to use cash collateral for all purposes
permitted by the DIP Facility up to the aggregate amount of
disbursements and accruals in a prepared cash collateral budget.

As reported in the Troubled Company Reporter on Nov. 27, 2007,
Judge Glenn had authorized the Debtor, on an interim basis, to use
cash collateral for all purposes permitted by the DIP facility
pursuant to a cash collateral budget.

Cash collateral for which the Debtor is granted use does not
include cash collateral generated postpetition from the
Montecito, Diamond Ridge, Stone Creek or Providence projects as
to which RBC Centura Bank alleges to provide financing.

As reported in the Troubled Company Reporter on Nov. 22, 2007,
RBC Centura Bank told the Court that it objects to the use of cash
collateral as it relates to the Montecito, Diamond Ridge, Stone
Creek and Providence projects, on the basis that it has a security
interest in those projects, and the adequate protection proposed
by the Debtor is not sufficient.

                       About Dunmore Homes

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.  The Official Committee of Unsecured Creditors has
selected Morrison & Foerster LLP as its counsel in this bankruptcy
proceeding.  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. 7; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


ECHOSTAR COMMS: Distributes Shares for Separation of Businesses
---------------------------------------------------------------
EchoStar Communications Corporation distributed shares of common
stock of EchoStar Holding Corporation at 12:01 a.m. MST (2:01 a.m.
EST) on Jan. 1, 2008.  EchoStar Communications Corporation will
retain its pay-TV business, DISH Network and EchoStar Holding
Corporation will hold the technology and certain infrastructure
assets of EchoStar Communications Corporation, including its set-
top box business and certain satellite assets.  The record date
for the distribution was the close of business (5:00 p.m. EST) on
Dec. 27, 2007.  EchoStar Communications Corporation plans to
change its name to "DISH Network Corporation" following the
completion of the separation.

EchoStar Communications Corporation commenced mailing of the final
information statement, which outlines the operations of EchoStar
Holding Corporation and provides additional details regarding the
separation on Dec. 31, 2007.  A copy of the final information
statement will be available on the Securities and Exchange
Commission's Web site -- http://www.sec.gov/-- under the company
name "EchoStar Holding Corporation."

Each shareholder of EchoStar Communications Corporation will
receive for each share of common stock held as of the record date,
0.20 of a share of the same class of common stock of EchoStar
Holding Corporation.  If a shareholder of EchoStar Communications
Corporation sells shares of EchoStar Communications Corporation
common stock between the record date for the distribution and the
distribution date, the buyer of those shares and not the seller
will become entitled to receive the shares of EchoStar Holding
Corporation common stock distributed in respect of those shares.
Shares of EchoStar Holding Corporation Class A common stock have
been approved for listing on the Nasdaq Global Select Market under
the symbol "SATS." Shares of Class A common stock of EchoStar
Communications Corporation will continue to trade on the Nasdaq
Global Select Market under the symbol "DISH."  Regular-way trading
in shares of EchoStar Holding Corporation Class A common stock
commenced on Jan. 2, 2008.

                  About EchoStar Communications

Based in Englewood, Colorado, EchoStar Communications Corporation
(Nasdaq: DISH) -- http://www.echostar.com/-- serves more than
13.6 million satellite TV customers through its DISH Network(TM),
a pay-TV provider in the country since 2000.  DISH Network's
services include hundreds of video and audio channels, Interactive
TV, HDTV, sports and international programming, together with
professional installation and 24-hour customer service.  EchoStar
has been into satellite TV equipment sales and support for more
than 27 years.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 28, 2007,
Standard & Poor's Ratings Services placed its ratings on
EchoStar Communications Corp., including the 'BB-' corporate
credit rating, on CreditWatch with developing implications.  This
affects about $5.5 billion of rated debt.


FGX INT'L: Moody's Withdraws All Ratings After Debt Refinancing
---------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings on FGX
International Limited for business reasons.  Moody's added that
the ratings were withdrawn because the company had no rated debt
outstanding following the completion of its IPO and debt
refinancing.

These ratings were withdrawn:

* Issuer: FGX International Limited

  -- Corporate Family Rating, Withdrawn, previously rated B2

  -- Probability of Default Rating, Withdrawn, previously rated
     B2

  -- Senior Secured Bank Credit Facility Due 2010, Withdrawn,
     previously rated B1 (LGD 3, 35%)

  -- Senior Secured Bank Credit Facility Due 2012, Withdrawn,
     previously rated B1 (LGD 3, 35%)

  -- Senior Secured Bank Credit Facility Due 2013, Withdrawn,
     previously rated Caa1 (LGD 5, 84%)

  -- Outlook, Changed To Rating Withdrawn From Stable

FGX International Limited, based in Smithfield, Rhode Island, is a
leading marketer and distributor of branded and private-label
eyewear and costume jewelry, particularly in the mass retail
channels and primarily under the FosterGrant and Magnivision
brands.  Net sales for the twelve-month period ending Sept. 30,
2007 were approximately $248 million.


FIRST DARTMOUTH: Case Summary & 13 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: First Dartmouth Homes
        724-A 2nd Avenue South
        St. Petersburg, FL 33701
        Tel: (727) 541-1100

Bankruptcy Case No.: 07-12927

Type of Business: The Debtor is focused on developing luxury
                  residential and mixed-use communities and yacht
                  clubs.  See http://www.firstdartmouth.com/

Chapter 11 Petition Date: December 28, 2007

Court: Middle District of Florida (Tampa)

Judge: K. Rodney May

Debtor's Counsel: John D. Emmanuel, Esq.
                  Fowler, White, Boggs, Banker, P.A.
                  P.O. Box 1438
                  Tampa, FL 33601
                  Tel: (813) 228-7411
                  Fax: (813) 229-8313

Estimated Assets:  $1 Million to $10 Million

Estimated Debts: $50 Million to $100 Million

Debtor's 13 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
BankAtlantic                   guaranty              $30,057,522
2100 West Cypress Creek Road
Fort Lauderdale, FL 33309

Colonial Bank                  guaranty; Aquaplex    $11,500,000
5858 Central Avenue            Ventures II, L.L.C.
St. Petersburg, FL 33707       loan

Regions Bank                   guaranty, Urban Edge, $6,902,628
13535 Feather Sound Drive      L.L.C. loan
Building 1, Suite 610
Clearwater, FL 33762

                               guaranty, Tamarind    $4,3878,751
                               Ventures, L.L.C. loan

Hendricks Brown                judgment              $678,409
Kathleen Cerevenka
c/o Guy P. Coburn, Esq.
150 Second Avenue North 1700
St. Petersburg, FL 33701

Thomas Calhoun                 arbitration award     $400,000
c/o Nicholas Karatinos, Esq.
Seeley & Karatinos, P.A.
3924 Central Avenue
St. Petersburg, FL 33711

Elite Weiler Pools, Inc.       trade debt            $35,776

Wilson Miller, Inc.            land planners-        $16,807
                               services for
                               Riviera Southshore
                               Ventures

Cox Lumber Co.                 trade debt            $11,628

Pinellas County Tax Collector  property taxes        $17,995

Frank and Nancy Maggio         enterprise zone tax   $2,339
                               refunds issued by
                               the Department of
                               Revenue, State of
                               Florida

Pinellas County                assessment            $810

Bayou Club Comm. Association,  home owners           $3,123
Inc.                           association fees

Frank Maggio                                         unknown


FIRST FRANKLIN: Weak Performance Cues S&P to Downgrade Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 32
classes of asset-backed certificates issued by five First Franklin
Mortgage Loan Trust transactions.  S&P removed 12 of the 32
lowered ratings from CreditWatch with negative implications.
Lastly, S&P affirmed its ratings on the remaining classes from
these series.

The downgrades reflect continued poor collateral performance,
allowing credit enhancement to decline to a point at which it is
insufficient to maintain the previous ratings.  Over the past six
months, monthly losses have generally exceeded monthly excess
interest cash flow, causing the complete erosion of
overcollateralization for all five transactions.  This trend has
resulted in principal write-downs to 11 classes from these series.
As of the November 2007 remittance report, cumulative realized
losses were (series: percent of original pool balance, amount):

     -- 2003-FFH1: 3.81%, $22,218,280;
     -- 2003-FFH2: 3.25%, $34,082,669;
     -- 2004-FFH1: 3.30%, $26,182,878;
     -- 2004-FFH2: 2.94%, $35,227,076; and
     -- 2004-FFH3: 2.72%, $40,853,803.

In addition, all five series with lowered ratings have sizable
loan amounts that are severely delinquent (90-plus days,
foreclosures, and REOs), which strongly suggests that the
unfavorable performance trends are likely to continue and further
compromise available credit support.  The severe
delinquencies are (series: percent of current pool balance,
amount):

     -- 2003-FFH1: 29.62%; $15,403,545;
     -- 2003-FFH2: 27.36%; $26,012,582;
     -- 2004-FFH1: 32.32%; $24,219,736;
     -- 2004-FFH2: 28.89%; $53,477,402; and
     -- 2004-FFH3: 25.55%; $77,079,666.

Standard & Poor's removed 12 ratings from CreditWatch negative
because S&P lowered them to 'CCC' or 'D', or because S&P does not
anticipate further rating actions within the next three months
based on its loss forecasts for these transactions.  The
affirmations are based on credit support percentages that are
sufficient to maintain the current ratings, despite the
performance trend.

The underlying first-lien high loan-to-value (LTV) collateral
consists of fixed- and adjustable-rate, fully amortizing and
balloon payment mortgage loans secured by first liens by one- to
four-family residential properties.  The weighted average LTV
ratio of the mortgage loans in these transactions is
generally greater than 90%.  First Franklin Financial Corp.
originated or purchased these mortgages in accordance with
guidelines that target borrowers with less-than-perfect credit
histories.  The guidelines are intended to assess both the
borrower's ability to repay the loan and the adequacy of the value
of the property securing the mortgage.

                         Ratings Lowered

               First Franklin Mortgage Loan Trust
                    Asset-backed certificates

                                Rating
                                ------

        Series         Class      To             From
        ------         -----      --             ----

        2003-FFH1      M-1        BBB            AA
        2003-FFH1      M-5        D              CCC
        2003-FFH2      M-1A       BBB            AA
        2003-FFH2      M-1B       BBB            AA
        2003-FFH2      M-2        B              A
        2004-FFH1      M-2        BBB            AA
        2004-FFH1      M-3        BB             AA-
        2004-FFH1      M-4        B              A+
        2004-FFH2      M-4        BBB            A+
        2004-FFH2      M-5        BB             A
        2004-FFH2      M-6        B+             A-
        2004-FFH2      M-7        B              BBB+
        2004-FFH2      M-8        CCC            BBB
        2004-FFH2      M-9        CCC            BBB-
        2004-FFH2      B-2        D              CCC
        2004-FFH3      M-6        BBB+           A-
        2004-FFH3      M-7        BB             BBB+
        2004-FFH3      M-8        B              BBB
        2004-FFH3      M-9        B-             BBB-
        2004-FFH3      B-1        CCC            BB+

     Ratings Lowered and Removed from CreditWatch Negative

                First Franklin Mortgage Loan Trust
                     Asset-backed certificates

                              Rating
                              ------

      Series         Class      To            From
      ------         -----      --            ----

      2003-FFH1      M-2        B             BBB/Watch Neg
      2003-FFH1      M-3        CCC           BB/Watch Neg
      2003-FFH1      M-4        CCC           B/Watch Neg
      2003-FFH2      M-3        CCC           BBB/Watch Neg
      2003-FFH2      M-4        CCC           BB-/Watch Neg
      2003-FFH2      M-5        D             B/Watch Neg
      2004-FFH1      M-5        B-            BBB/Watch Neg
      2004-FFH1      M-6        CCC           BBB-/Watch Neg
      2004-FFH1      M-7        CCC           BB/Watch Neg
      2004-FFH1      M-8        D             B/Watch Neg
      2004-FFH2      B-1        CCC           BB+/Watch Neg
      2004-FFH3      B-2        D             B/Watch Neg

                         Ratings Affirmed

                First Franklin Mortgage Loan Trust
                     Asset-backed certificates

          Series          Class                 Rating
          ------          -----                 ------

          2004-FFH1       M-1                   AA+
          2004-FFH2       A-1                   AAA
          2004-FFH2       M-1                   AA+
          2004-FFH2       M-2                   AA
          2004-FFH2       M-3                   AA-
          2004-FFH3       I-A1                  AAA
          2004-FFH3       I-A2                  AAA
          2004-FFH3       II-A3                 AAA
          2004-FFH3       II-A4                 AAA
          2004-FFH3       M-1                   AA+
          2004-FFH3       M-2                   AA
          2004-FFH3       M-3                   AA-
          2004-FFH3       M-4                   A+
          2004-FFH3       M-5                   A


FIRSTLIGHT HYDRO: S&P Holds BB- Rating on $320MM Mortgage Bonds
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' rating on
FirstLight Hydro Generating Co.'s $320 million first mortgage
bonds maturing 2026.  At the same time, S&P revised the outlook to
negative from stable.  The recovery rating remains unchanged, at
'1'.

The outlook revision reflects a financial performance in the first
three quarters of 2007 that was significantly below pro forma
expectations (EBITDA of $95 million compared with expected EBITDA
of $124 million) due to low regulation revenues and unfavorable
weather conditions affecting run-of-river
hydro facilities and energy spreads for the Northfield Mountain
pumped storage facility.  In addition, Northfield Mountain had
significant merchant exposure from October 2006 to May 2007,
before executing hedges for about 75% of its capacity (three of
four turbines).  This exposure coincided with a mild winter
that resulted in low power prices and reduced spreads between peak
and off-peak periods, which is one of the key variables that
determine the facility's gross margin.

FirstLight is facing several challenges over the next year that
could affect the rating on its facilities.  Standard & Poor's
believes FirstLight will contract, in some form, energy margins
for 2012-2013 within the next 18 months.

"Failure to do so could adversely affect the rating due to the
dependence on these years for significant amounts of cash for
first-lien sweeping," said Standard & Poor's credit analyst Justin
Martin.

"Should FCM prices prove less robust than anticipated, the rating
could also come under downward pressure," Mr. Martin said.


FIRSTLIGHT POWER: S&P Holds BB- Rating on $695MM Sr. Facilities
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' rating on
FirstLight Power Resources Inc.'s $695 million senior secured
facilities consisting of a $550 million first-lien term loan, a
$70 million revolving credit facility, and a $65 million letter of
credit facility.  S&P also affirmed the 'B-' rating on the
$170 million second-lien term loan.  At the same time, Standard &
Poor's revised the outlook on all facilities to negative from
stable.  The recovery ratings for both ratings remain unchanged,
at '1' and '5', respectively.

The outlook revision reflects a financial performance in the first
three quarters 2007 that was significantly below pro forma
expectations (EBITDA of $95 million compared with expected EBITDA
of $124 million) due to low regulation revenues and unfavorable
weather conditions affecting run-of-river hydro facilities and
energy spreads for the Northfield Mountain pumped storage
facility.  In addition, Northfield Mountain had significant
merchant exposure from October 2006 to May 2007, before executing
hedges for about 75% of its capacity (three of four turbines).
This exposure coincided with a mild winter that resulted in low
power prices and reduced spreads between peak and off-peak
periods, which is one of the key variables that determine the
facility's gross margin.

FirstLight faces several challenges over the next year that could
affect the rating on its facilities.  If the Mt. Tom emissions-
control project experiences problems in construction cost,
scheduling, or efficiency, the project could face lower margins in
efforts to correct the problem.  In addition, S&P believes
FirstLight will contract, in some form, energy margins for 2012-
2013 within the next 18 months.

"Failure to do so could adversely affect the rating due to the
dependence on these years for significant amounts of cash for
first-lien sweeping.  Should forward capacity market prices prove
less robust than anticipated, the rating could also come under
downward pressure," said Standard & Poor's credit analyst Justin
Martin.


GENTEK INC: Subsidiary Acquires Bay Chemical for $7 Million
-----------------------------------------------------------
GenTek Inc.'s wholly owned subsidiary, General Chemical LLC, has
acquired Bay Chemical and Supply Company, a producer of water
treatment chemicals in Odem, Texas.  The purchase price of the
transaction is $7 million before any working capital adjustments.

"This transaction expands our customer base in the Texas market,
adds new products to our portfolio of water treatment chemicals
and allows us to drive incremental savings through our raw
material sourcing arrangements," Vincent J. Opalewski, Vice
President and General Manager of General Chemical LLC, noted.

"This acquisition fits well with our stated objective to invest in
the company's core assets, chemical and auto/truck valve train
systems, to accelerate GenTek shareholder value creation," William
E. Redmond, Jr., GenTek's President and Chief Executive Officer,
added.

GenTek Inc. (NasdaqGS: GETI) -- http://www.gentek-global.com/--
provides specialty inorganic chemical products and services for
treating water and wastewater, petroleum refining, and the
manufacture of personal-care products, valve-train systems and
components for automotive engines and wire harnesses for large
home appliance and automotive suppliers.

                          *     *     *

As reported in the Troubled Company Reporter on April 19, 2007,
Moody's Investors Service upgraded GenTek Inc.'s corporate family
rating to B1 from B2, the company's $269 million first lien term
loan to Ba3 from B1, the company's $60 million first lien
revolving credit facility to Ba3 from B1, and GenTek's speculative
grade liquidity rating to SGL-2 from SGL-3.  These actions
conclude the review commenced on Feb. 15, 2007.  The ratings
outlook is positive.


HARMAN INTERNATIONAL: Elects Gary Steel to Board of Directors
-------------------------------------------------------------
Harman International Industries Incorporated has appointed Gary
Steel to serve as a member of the company's board of directors.
The board was also expanded from seven to eight members.

Mr. Steel will serve under this appointment until November 2009,
subject to reelection by the board.

Mr. Steel, a Scottish citizen, served as executive committee
member responsible for Human Resources at ABB Ltd, a series of
senior management positions for the Shell group of energy and
petrochemical companies.  His professional background includes
extensive experience in human resource development, restructuring,
and corporate governance.

"We are delighted to welcome a global executive of Gary Steel's
competence to our board of directors," Dr. Sidney Harman, chairman
and Dinesh Paliwal, chief executive officer, said. "Gary's deep
expertise in human resource development, strategic initiatives and
governance will serve as a valuable asset as we carefully match
our company's strategy to evolving global markets and resources."

                    About Harman International

Based in Washington, D.C., Harman International Industries Inc.
(NYSE: HAR) -- http://www.harman.com/-- manufactures, designs and
markets a range of audio and infotainment products for the
automotive, consumer and professional markets.  The company
maintains a presence in the Americas, Europe and Asia and employs
more than 10,500 people worldwide.  The Harman International
family of brands spans some 15 leading names including AKG,
Audioaccess, Becker, BSS, Crown, dbx, DigiTech, DOD, Harman
Kardon, Infinity, JBL, Lexicon, Mark Levinson, Revel, QNX,
Soundcraft and Studer.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 24, 2007,
Standard & Poor's Ratings Services revised its CreditWatch
implications for the 'BB-' corporate credit rating on Harman
International Industries Inc. to positive from developing.


JADE ART: Oct. 31 Balance Sheet Upside-Down by $9.77 Million
------------------------------------------------------------
Jade Art Group Inc.'s consolidated balance sheet at Oct. 31, 2007,
showed $5.87 million in total assets and $15.64 million in total
liabilities, resulting in a $9.77 million total stockholders'
deficit.

At Oct. 31, 2007, the company's consolidated balance sheet also
showed strained liquidity with $5.65 million in total current
assets available to pay $15.64 million in total current
liabilities.

The company reported net income of $1.55 million on sales of
$7.16 million for the first quarter ended Oct. 31, 2007, compared
with net income of $2.25 million on sales of $6.27 million in the
same period last year.

Income from operations was $3.09 million, an increase of $420,470
from income from operations of $2.67 million in the first quarter
ended Oct. 31, 2006.  The increase in income from operations
resulted primarily from the increase in revenues.

The decrease in net income resulted primarily from the increase in
income tax expense mainly resulting from the increased tax rate.

As of Oct. 31, 2007, the company had cash and cash equivalents of
$49,599 as compared to $539,926 as of Oct. 31, 2006.

Full-text copies of the company's consolidated financial
statements for the quarter Oct. 31, 2007, are available for free
at http://researcharchives.com/t/s?26ab

                       About Jade Art Group

Incorporated in Nevada, Jade Art Group Inc. formerly Vella
Productions Inc. (OTC BB: JADG) through its subsidiaries, engages
in wood carving business in China.  The company manufactures wood
products, including both traditional hand-carved and machine-
carved pieces, specializing in mantels, panels, furniture,
ornamental bands, religious decorations, and architectural
accents. It also manufactures Buddhist Shrines.  The company was
founded in 1973 and is based in Yujiang County, China.


KAUFMAN COUNTY: Case Summary & Four Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Kaufman County Land Trust
        fdba Whitney Herigage III, L.L.C.
        153 Whispering Winds
        Gunter, TX 75058

Bankruptcy Case No.: 07-43081

Type of Business: The Debtor owns and manages real estate.

Chapter 11 Petition Date: December 31, 2007

Court: Eastern District of Texas (Sherman)

Debtor's Counsel: Eric A. Liepins, Esq.
                  12770 Coit Road, Suite 1100
                  Dallas, TX 75251
                  Tel: (972) 991-5591

Total Assets: $30,000,000

Total Debts:  $11,906,985

Debtor's Four Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Eric L. Davis Engineering      $27,000
425 Pinson Road
Forney, TX 75126

Jack Hatchell & Associates     $10,000
P.O. Box 260119
Plano, TX 75026

Kaufman County-Tax Assesor     $8,000
P.O. Box 339
100 West Mulberry
Kaufman, TX 75142-0339

Chandler Commercial Mowing     $3,000


KINGSWAY FINANCIAL: Secures to CDN$70 Million Credit Facility
-------------------------------------------------------------
Kingsway Financial Services Inc. entered into a 365-day
CDN$70 million credit facility agreement with a syndicate of
banks.  The credit facility is supplemental to the existing
$175 million credit facility that matures in June 2009.

"We are pleased that our relationships with our banking partners
have enabled us to obtain this additional flexibility particularly
at this time when credit conditions in the markets are
challenging", Shaun Jackson, executive vice president and CFO of
Kingsway Financial, said.  "We have undrawn amounts under our
current facility but will utilize these new funds to repay our
maturing 8.25% CDN$78 million debentures on Dec. 31, 2007 at a
lower financing cost."

Headquartered in Ontario, Canada, Kingsway Financial Services Inc.
(TSX:KFS, NYSE:KFS) - http://www.kingsway-financial.com/   -- is
a holding company that operates through its wholly owned
subsidiaries in the property and casualty insurance business.  The
company's principal lines of business are trucking and non-
standard automobile insurance.   KFSI also writes motorcycle
insurance in Canada and writes taxi cab insurance in Chicago,
Illinois and Las Vegas, Nevada.

                           *     *     *

As reported in the Troubled Company Reporter on Dec. 21, 2007,
Standard & Poor's Ratings Services lowered its senior unsecured
and long-term counterparty credit ratings on Kingsway Financial
Services Inc. to 'BB+' from 'BBB-'.  S&P also lowered the debt
ratings on Kingsway's subsidiaries to 'BB+' from 'BBB-'.  The
outlook is negative.


LEAP WIRELESS: S&P Maintains B- Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on San
Diego, California-based Leap Wireless International Inc.,
including the 'B-' corporate credit rating, and removed
them from CreditWatch.  The outlook is stable.

The ratings affirmation follows the release of Leap's second-
quarter 2007 10-Q, which brings the company into compliance with
reporting requirements under its credit facility.  Leap, a
wireless carrier, had received a waiver from the secured lenders
on November 20, subject to filing of the restated financial
statements by Dec. 31, 2007.

"Although our immediate liquidity concerns have been partially
mitigated, we have determined that the reinstatement of a positive
outlook will hinge on the company's ability to limit further
accounting issues, which would require a minimum of two quarters
of timely and accurate financial reporting," said Standard &
Poor's credit analyst Catherine Cosentino.  In addition, Leap will
need to demonstrate improved financial and operating results,
which were weaker than S&P's expectations over the past two
quarters.

The ratings were placed on CreditWatch with negative implications
on Nov. 7, 2007, due to the potential for covenant violations
under a $1.1 billion senior secured credit facility and senior
unsecured notes following the company's announcement that it
planned to restate its audited financial statements for fiscal
years 2004, 2005, and 2006 and for the first and second quarters
of 2007 to correct errors in previously reported service revenues,
equipment revenues, and operating expenses.


MIDNIGHT HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $36.5MM
----------------------------------------------------------------
Midnight Holdings Group Inc.'s consolidated balance sheet at
Sept. 30, 2007, showed $1.9 million in total assets and
$38.4 million in total liabilities, resulting in a $36.5 million
total stockholders' deficit.

At Sept. 30, 2007, the company's consolidated balance sheet also
showed strained liquidity with $368,158 in total current assets
available to pay $37.6 million in total current liabilities.

The company reported a net loss of $1.7 million on total revenues
of $1.4 million for the third quarter ended Sept. 30, 2007,
compared with a net loss of $5.2 million on total revenues of
$620,711 in the same period last year.

During the quarter ended Sept. 30, 2007, gross profit increased by
$243,975 to $287,696 compared to the gross profit for the quarter
ended Sept. 30, 2006.

For the three months ended Sept. 30, 2007, the derivative
instrument expense totaled $624,036, compared to an expense of
$4.0 million for the three months ended Sept. 30, 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?26ac

                     About Midnight Holdings

Based in Clinton Twp., Mich., Midnight Holdings Group Inc.
(MHGI.PK) -- http://www.midnightholdings.com/-- offers a large
array of automotive products and services that target retail
consumers and fleet service operators through its wholly owned
subsidiaries All Night Auto(R) and All Night Lube Express(TM).


MORGAN STANLEY: Fitch Rates Three Certificate Classes at Low-B
--------------------------------------------------------------
Morgan Stanley Capital I Trust 2007-HQ13, commercial mortgage
pass-through certificates are rated by Fitch Ratings:

  -- $146,100,000 class A-1 'AAA';
  -- $179,353,000 Class A-1A 'AAA';
  -- $67,700,000 class A-2 'AAA';
  -- $334,490,000 class A-3 'AAA';
  -- $103,949,000 class A-M 'AAA';
  -- $72,765,000 class A-J 'AAA';
  -- $18,191,000 class B 'AA';
  -- $11,694,000 class C 'AA-';
  -- $16,892,000 class D 'A';
  -- $12,993,000 class E 'A-';
  -- $11,695,000 class F 'BBB+';
  -- $11,694,000 class G 'BBB';
  -- $12,994,000 Class H 'BBB-';
  -- $3,898,000 class J 'BB+';
  -- $3,898,000 class K 'BB';
  -- $3,898,000 class L 'BB-';
  -- $1,039,491,008 (Notational amount and interest only) class
     X 'AAA'.

The $10,395,000 class M, $2,599,000 class N, $3,898,000 class O,
and $10,395,008 class P are not rated by Fitch.

All classes are privately placed pursuant to rule 144A of the
Securities Act of 1933.  The certificates represent beneficial
ownership interest in the trust, primary assets of which are 82
fixed-rate loans having an aggregate principal balance of
approximately $1,039,491,008, as of the cutoff date.


NASDAQ STOCK: Gets CFIUS Clearance on Borse Dubai Investment Deal
-----------------------------------------------------------------
The Nasdaq Stock Market Inc. has obtained clearance from The
Committee on Foreign Investment in the United States concerning
Borse Dubai's investment in NASDAQ, which will allow NASDAQ to
proceed with its plans to combine with Stockholm-based OMX AB
(publ).  NASDAQ and Borse Dubai Limited had previously voluntarily
submitted their agreement to CFIUS for review.

As a result of CFIUS approval, NASDAQ said that as part of its
transaction with Borse Dubai, disclosed on Sept. 20, 2007, it has
formally withdrawn its offer for OMX and supports Borse Dubai's
all cash offer of SEK265 per share to acquire OMX.  All other
previously agreed conditions for Borse Dubai to open its offer
have now been fulfilled or waived in accordance with the
agreements between Borse Dubai and NASDAQ.  Provided Borse Dubai
owns in total at least 67% of the shares of OMX and the conditions
for closing the transaction under the agreement with NASDAQ have
been satisfied or waived, Borse Dubai will sell all OMX shares it
owns to NASDAQ for consideration in NASDAQ shares and cash, as
previously announced.  At the same time, NASDAQ will make an
investment in Dubai International Financial Exchange.

As reported in the Troubled Company Reporter on Dec. 6, 2007,
NASDAQ and Borse Dubai joined efforts to provide a compelling,
long-term enhancement and growth strategy for OMX and the Nordic
and Baltic region.  Borse Dubai and NASDAQ had secured irrevocable
undertakings from Investor AB (publ), Nordea Bank AB (publ), Olof
Stenhammar, Didner & Gerge Fonder AB, Nykredit Realkredit A/S and
Magnus Bocker, who in aggregate hold approximately 18.5% of the
total number of votes and shares in OMX, at the increased price of
Borse Dubai's cash offer.

NASDAQ's now-withdrawn stand-alone offer for OMX was conditional
upon being accepted to such an extent that NASDAQ becomes the
owner of shares representing more than 90% of the outstanding
shares in OMX on a fully diluted basis.  Borse Dubai will open its
offer for OMX for acceptances when the offer document has been
approved by relevant authorities.

Taking into account that Borse Dubai, before the opening of its
offer, controls shares, options and irrevocable undertakings which
will result in Borse Dubai holding approximately 48.3% of OMX's
issued share capital and votes when the options and irrevocable
undertakings are exercised in accordance with what has previously
been announced, it is clear that the 90% acceptance condition in
NASDAQ's stand-alone offer cannot be fulfilled.

NASDAQ, therefore, withdraws its stand-alone offer for OMX, in
accordance with the agreements with Borse Dubai and as presented
in statement from the Swedish Securities Council.

                         About Nasdaq

Headquartered in New York City, The Nasdaq Stock Market Inc.
(Nasdaq: NDAQ) -- http://www.nasdaq.com/-- is an electronic
equity securities market in the United States with about 3,200
companies.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 24, 2007,
Moody's Investors Service placed the Ba3 corporate family rating
of Nasdaq Stock Market Inc. on review for upgrade.

On Sept. 20, 2007, Standard & Poor's Rating Services assigned BB
long-term foreign and local issuer credit ratings to Nasdaq Stock
Market Inc.


NASDAQ STOCK: OMX AB Board Backs Borse Dubai's Public Offer
-----------------------------------------------------------
The board of directors of OMX AB (publ) unanimously recommends
the public offer from Borse Dubai Limited taking into account the
acquisition of OMX shares by The NASDAQ Stock Market Inc.

"The combination of OMX and NASDAQ will create a new leader in the
exchange industry, establish a strong platform for future growth
and reinforce the Nordic and Baltic region as a financial centre,"
Urban Backstrom, chairman of OMX.  "Linking trading centres in the
US, Europe and the Middle East will provide members, issuers and
all other market participants with considerable opportunity in the
changing global capiSiemens Divisiontal markets.  The Borse Dubai
offer and the agreed, subsequent acquisition of OMX shares by
NASDAQ, is also attractive to our shareholders."

                           Background

On May 25, 2007, NASDAQ and OMX had entered into an agreement to
combine the two companies to form a new group, The NASDAQ OMX
Group Inc.  The combination was to be effected through a cash and
stock tender offer by NASDAQ for all outstanding shares in OMX.
The board of OMX unanimously recommended to the OMX shareholders
that they accept this tender offer by NASDAQ.

On Aug. 9, 2007, Borse Dubai was in the process of purchasing OMX
shares at a price of SEK230 and entering into options for
OMX shares at an exercise price of SEK230 by way of a book
building process with selected investors.

Later that day, Borse Dubai also had purchased OMX shares
representing 4.9% of the share capital in OMX at a price of SEK230
and entered into option agreements to purchase another 22.5% of
OMX shares at an exercise price of SEK230, Borse Dubai
subsequently entered into additional option agreements to purchase
a total of another 24.2% of OMX shares at the greater of SEK230
per share and the offer price at the end of the acceptance period.

On Aug. 17, 2007, Borse Dubai disclosed an all-cash offer for all
outstanding shares in OMX at a price of SEK230 per OMX share.

On Sept. 20, 2007, NASDAQ and Borse Dubai had entered into
agreements pursuant to which Borse Dubai's Offer of SEK230 in
cash per OMX share was to continue, but that a series of
transactions was to be subsequently effected that would involve,
amongst other things, NASDAQ purchasing all of Borse Dubai's
shares in OMX for a combination of cash and new NASDAQ shares.

As a result of these transactions, Borse Dubai would retain NASDAQ
OMX shares representing approximately 19.99% of the
combined NASDAQ OMX share capital, restricted to 5% of voting
rights, with its remaining NASDAQ OMX shares -- representing
approximately 8.4% of the combined NASDAQ OMX share capital --
being held in trust with an affiliate of Borse Dubai as
beneficiary and managed by an independent trustee.

Later on September 20, Qatar Investment Authority has purchased
OMX shares representing 9.98% of the share capital in OMX.

On Sept. 26, 2007, NASDAQ and Borse Dubai had raised its Offer to
SEK265 in cash per each OMX share.  It was also disclosed that
irrevocable undertakings had been secured, subject to
certain conditions, from Investor AB, Nordea Bank AB, Olof
Stenhammar, Didner & Gerge, Nykredit and Magnus Bocker to tender
no less than 22.4 million OMX shares, equivalent to 18.5% of all
the outstanding shares and votes in OMX, into the Offer and that
these undertakings were binding unless a third party offered
greater than SEK303 per OMX share and Borse
Dubai did not match in a certain period -- Borse Dubai
subsequently secured additional irrevocable undertakings,
subject to certain conditions, from Investor AB, Nordea Bank AB,
Olof Stenhammar, Didner & Gerge, Nykredit, Magnus Bocker and
certain other shareholders to tender no less than a total of 23.3
million OMX shares, equivalent to 19.3% of all the outstanding
shares and votes in OMX, into the Offer and that these
undertakings were binding unless a third party offered greater
than SEK303 per OMX share and Borse Dubai did not match in a
certain period.

The agreements were conditional upon customary regulatory and
shareholder approvals in both Sweden and other Nordic and
Baltic jurisdictions well as in the United States and approval by
shareholders of NASDAQ, all of which have been obtained or waived.

Consequently, NASDAQ has withdrawn its offer for OMX, and Borse
Dubai is expected to open its Offer for acceptances on Jan. 7,
2008.

The board relates that the combination of OMX and NASDAQ will have
a number of important benefits for OMX and its stakeholders.  The
conditions to Borse Dubai's Offer include acceptance of the Offer
by holders of a majority of OMX's shares.

Shareholders are advised to note that completion of the agreed,
subsequent acquisition by NASDAQ of Borse Dubai's shares in OMX is
subject to certain conditions, including that Borse Dubai
hold more than 67% of the shares in OMX following completion of
the Offer.

As a result, holders of OMX shares should be aware that there is a
possibility that, if such conditions are not satisfied or waived,
the Borse Dubai Offer could be completed but the subsequent
acquisition by NASDAQ of OMX shares from Borse Dubai would not
proceed and thus those benefits would not be obtained.

When issuing this recommendation, the board took into
account this possibility, together with its view that, if the
Borse Dubai Offer is consummated, there is a high likelihood that
these conditions will be satisfied and that the combination of OMX
and NASDAQ will be completed.

                          Nasdaq Notice

The board has received a letter from NASDAQ, dated Dec. 14, 2007,
regarding the interpretation of the original transaction agreement
between NASDAQ and OMX of May 25, 2007.  In the letter, NASDAQ
clarifies and confirms its understanding that, upon NASDAQ's
subsequent acquisition of Borse Dubai's shares in OMX, NASDAQ's
and OMX's agreements regarding, among other things, board
composition, corporate name, senior management and OMX Nordic
Exchange secondary listing of the combined NASDAQ OMX Group shall
apply, with certain modifications, as if
NASDAQ's original offer of May 25, 2007, had been consummated.

The Offer values OMX at SEK265 per share, equivalent to
SEK32 billion, and represents a premium of 52% to the closing
price of SEK174.5 per OMX share on May 23, 2007, the last trading
day prior to the statement of the OMX and Nasdaq combination on
May 25, 2007, and a premium of 59% to the volume weighted average
price of SEK166.3 per OMX share over the
20 trading days up to and including May 23, 2007.

The board of OMX came to the conclusion that the proposed
combination with NASDAQ was the best available option.

Notwithstanding that NASDAQ's original offer has been withdrawn,
the board notes that the agreed transactions between NASDAQ and
Borse Dubai post consummation of the Offer will cause NASDAQ and
OMX to combine in a manner similar to that originally envisaged as
of May 25, 2007.

Accordingly, the board states that the Offer will provide OMX, its
customers and its other stakeholders with the same benefits as the
original combination with NASDAQ.

                        Merger Benefits

The board states that the agreed transactions between NASDAQ and
Borse Dubai post consummation of the Offer will result in
additional benefits such as the partnership with the Dubai
International Financial Exchange which will provide further
exposure to attractive emerging growth markets and additional
opportunities.

Cooperation with Borse Dubai will strengthen NASDAQ OMX by,
among others things, facilitating access to a pool of untapped
capital and the growth opportunities in a region of approximately
40 countries spanning North and Eastern Africa, the Middle East,
the Caspian region and South-Central Asia, and giving issuers
access to a pool of untapped capital with the United Arab
Emirates, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait.

Furthermore, Borse Dubai would provide international, including
Nordic, investors with direct access to new financial products
such as sukuk (short and long term asset backed loans similar to
bonds), structured products, funds and indices from one of the
growing regions in the world.

Unlike NASDAQ's original offer, the Offer by Borse Dubai to the
OMX shareholders is an all-cash offer and as such will not give
OMX shareholders the opportunity to share in the substantial value
the OMX and NASDAQ combination should generate from the
anticipated revenue and cost synergies.

However, the board relates that the increase in the price offered
for each OMX share from SEK208.1 as of May 25, 2007, as per the
tender offer from NASDAQ to SEK 265 as per the Offer compensates
the OMX shareholders appropriately.

The combined group, to be called The NASDAQ OMX Group, will
combine two complementary businesses, uniting NASDAQ's brand and
efficient electronic trading platform with OMX's global technology
services platform and customer base, efficient Nordic Exchange and
derivatives capabilities.

The combined group will be a financial marketplace with a
footprint spanning the U.S., Europe, the Middle East and strategic
emerging markets.  The combination will provide
significant benefits for customers, shareholders and other
stakeholders in both companies.

The combined group's strategy will be to grow volume and
broaden its customer base, combining the strengths of both
companies.  In this context, the proposed transaction will create
enhanced career opportunities for employees of the combined group.

The board of directors does not foresee any significant staff
reductions as a consequence of the combination.

The NASDAQ OMX Group will be a network of exchanges and exchange
customers linked by technology.  It will be positioned to drive
organic growth and to continue to take a proactive role in sector
consolidation.  The combined group will have pro forma 2006
revenues of SEK8.3 billion or 1.2 billion and around 2,500
employees in 22 countries.  It will in addition own a one-third
interest in Borse Dubai's subsidiary DIFX.

NASDAQ has expressed commitment to the Nordic and Baltic region,
including the Nordic and Baltic regulatory and operational
frameworks and procedures.  NASDAQ recognizes that the Nordic and
Baltic financial sector is one of the most important drivers of
the Nordic and Baltic economies.

The strategy of the new company will be to build on the existing
businesses, market models and stakeholder influence of OMX in this
region.

NASDAQ has committed to support investments in ongoing research
and development in Stockholm and will promote Stockholm as a
financial technology and know-how centre of excellence.  NASDAQ
OMX will provide the Nordic and Baltic region with the resources
and infrastructure necessary to grow the business, which is likely
to increase employment opportunities in
the region, and will seek to ensure that the region's capitals are
acknowledged as leading financial centres in Europe by 2010.

In order to strengthen the competitive position of the region's
financial centres, NASDAQ fully supports the ongoing development
of areas such as:

   a) Regulation and supervision: NASDAQ OMX will be committed
      to the existing Nordic and Baltic regulatory and
      operational frameworks, procedures and efficient
      supervisory authority.  NASDAQ will continue its active
      engagement with the U.S. Securities and Exchange
      Commission, Treasury Department and Congress to ensure
      that there is no U.S. regulatory spillover directly or
      indirectly as a result of this transaction.  The
      financial supervisory authorities in all the seven
      jurisdictions concerned have received written assurances
      to this effect from the SEC;

   b) Competition: NASDAQ OMX will safeguard the Nordic and
      Baltic region's competitive position in the MiFID
      environment by enhanced efficiencies and innovative
      approaches to trading and pan-European market structure;

   c) Efficiency and transparency: NASDAQ OMX will continue to
      focus on low costs, transparency and market efficiency to
      the benefit of the Nordic and Baltic capital markets;

    d) Education and research: NASDAQ OMX will stimulate
       education and research through, among others, seminars
       and academic committees within the concept of
       Finansplats Stockholm.

Furthermore, NASDAQ has confirmed its commitment to:

   -- the European headquarters of NASDAQ OMX being located in
      Stockholm;

   -- the world technology business headquarters of NASDAQ OMX
      being located in Stockholm;

   -- key senior positions remaining in Stockholm, Helsinki and
      Copenhagen;

   -- four OMX directors being recommended to be on the NASDAQ
      OMX Board, including the Deputy Chairman; and

   -- the OMX Nordic Exchange Board remaining as is, with
      its current Nordic composition.

NASDAQ is confident that it can provide OMX with growth
opportunities within the developed, European financial markets
with Stockholm as the operational base for pan-European efforts,
well as in the emerging markets using its Stockholm-based
technology business and know-how to help develop capital markets
in high growth regions worldwide.

The board's recommendation is based on factors that the
board considers relevant for the Offer, including but not
limited to the evaluation of OMX's and NASDAQ's current and
estimated future development of business operations and financial
results, estimated synergies, OMX's market position in the rapidly
changing and consolidating exchange industry, and other strategic
alternatives available to OMX.

                            Advisors

OMX's board has been advised by financial and other advisers in
connection with the Offer and the board's assessment thereof.
The board' financial advisers are Morgan Stanley & Co. Limited,
Credit Suisse Securities (Europe) Ltd. and Lenner & Partners
Corporate Finance AB.

The board's legal advisers are Advokatfirman Vinge KB, Cleary
Gottlieb Steen & Hamilton LLP and Gernandt & Danielsson
Advokatbyra KB.

Morgan Stanley and Credit Suisse have rendered fairness opinions
to the board of OMX to the effect that as of the date thereof and
based upon and subject to the qualifications and assumptions
therein and other factors deemed relevant, the Offer consideration
is fair from a financial point of view to the shareholders of OMX,
other than Borse Dubai and its affiliates.

                       About OMX AB (publ)

OMX AB (publ) -- http://www.omxgroup.com/-- is an exchange
industry.  The OMX Nordic Exchange comprises over 800 companies
including its alternative market First North.  OMX provides
technology to over 60 exchanges, clearing organizations and
central securities depositories in over 50 countries.  The Nordic
Exchange is not a legal entity but describes the common offering
from OMX exchanges in Helsinki, Copenhagen, Stockholm, Iceland,
Tallinn, Riga, and Vilnius.  OMX is a Nordic Large Cap company in
the Financials sector on the OMX Nordic Exchange.


Headquartered in New York City, The Nasdaq Stock Market Inc.
(Nasdaq: NDAQ) -- http://www.nasdaq.com/-- is an electronic
equity securities market in the United States with about 3,200
companies.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 24, 2007,
Moody's Investors Service placed the Ba3 corporate family rating
of Nasdaq Stock Market Inc. on review for upgrade.

On Sept. 20, 2007, Standard & Poor's Rating Services assigned BB
long-term foreign and local issuer credit ratings to Nasdaq Stock
Market Inc.


NATIONAL LAMPOON: Oct. 31 Balance Sheet Upside-Down by $4.13 Mil.
-----------------------------------------------------------------
National Lampoon Inc.'s consolidated balance sheet at Oct. 31,
2007, showed $8.08 million in total assets, $8.48 million in total
liabilities, and $3.73 million in accrued dividends payable in
common stock, resulting in a $4.13 million total shareholders'
deficit.

At Oct. 31, 2007, the company's consolidated balance sheet also
showed strained liquidity with $477,355 in total current assets
available to pay $8.48 million in total current liabilities.

The company reported a net loss of $1.17 million on total revenues
of $807,626 for the three months ended Oct. 31, 2007, compared
with net income of $1.73 million on total revenues of
$4.13 million in the same period ended Oct. 31, 2006.

Licensing and publishing revenues for the three months ended
Oct. 31, 2007, were $357,993 compared to $3.25 million for the
three months ended Oct. 31, 2006, representing a decrease of
$2.89 million or approximately 88%.  During the three months ended
Oct. 31, 2006, the company received a one-time payment of
approximately $2.9 million in settlement of a royalty dispute.  No
such payment occurred during the three months ended Oct. 31, 2007.

During the three months ended Oct. 31, 2007, advertising and
promotion revenues were $449,633 compared to $842,730 for the
three months ended Oct. 31, 2006.  This represents a decrease of
$393,097 or 46%.  The decrease was the result of a decrease of
$399,662 in promotion revenues mainly due to a reduction in the
number of field promotion events the company produced.

For the three months ended Oct. 31, 2007, there were no production
revenues as compared to $39,000 for the three months ended
Oct. 31, 2006.

The reveral to a net loss for the three months ended Oct. 31,
2007, resulted primarily from the significant increase in revenue
during the three months ended Oct. 31, 2006, which was associated
with the settlement of disputed license fees.

                 Liquidity and Capital Resources

With the exception of the first quarter of the fiscal year ended
July 31, 2007, the company has not generated positive cash flows
from operations over the past few years.  The company's principal
sources of working capital during the three months ended Oct. 31,
2007, consisted of loans from its officers and directors and
production loans from Red Rock Pictures Holdings Inc.

Full-text copies of the company's consolidated financial
statements for the quarter ended Oct. 31, 2007, are available for
free at http://researcharchives.com/t/s?26ae

                      Going Concern Doubt

Weinberg & Company P.A., in Los Angeles, epxressed substantial
doubt about National Lampoon Inc.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the year ended July 31, 2007.  The auditing frim
pointed to the company's working capital deficiency of $7,196,255
and accumulated deficit of $41,257,284 as of July 31, 2007, and a
net loss of $2,504,170 for the year ended July 31, 2007.

                     About National Lampoon

Based in West Hollywood, Calif. National Lampoon Inc.
(AMEX: NLN) -- http://www.nationallampoon.com/-- is currently
active in a broad array of media and entertainment segments.
These include feature films, television programming, online and
interactive entertainment, home video, audio, and book publishing.
The company also owns interests in all major National Lampoon
properties, including National Lampoon's Animal House, the
National Lampoon Vacation series and National Lampoon's Van
Wilder.  The company has three core operating divisions: National
Lampoon Films, College Marketing Division, and National Lampoon
Networks.


NAVIOS MARITIME: Shareholders OK Class B Directors Election
-----------------------------------------------------------
At an annual meeting, Navios Maritime Holdings Inc.'s stockholders
approved the election of two Class B directors, whose term will
expire in 2010:

    1. Ted C. Petrone; and

    2. Spyridon Magoulas.

In addition, the stockholders approved the ratification of the
appointment of PricewaterhouseCoopers as Navios' independent
public accountants for the fiscal year ending Dec. 31, 2007.

64% of Navios' common stock, which was represented in person or by
proxy, approved the requisite number of votes to approve all
matters.

Based in Norwalk, Connecticut, Navios Maritime Holdings Inc.
(NYSE: NM and NM WS) -- http://www.navios.com/-- is an
integrated seaborne shipping company, specializing in the
carriage, trading, storing, and other related logistics
of international dry bulk cargo transportation.  The company also
owns and operates a port/storage facility in Uruguay and has in-
house technical ship management expertise.  It has offices in
Piraeus, Greece, South Norwalk, Connecticut and Montevideo,
Uruguay and Antwerp, Belgium.  For over 50 years, Navios has
worked with raw materials producers, agricultural traders and
exporters, industrial end-users, ship owners, and charterers.
Navios also owns and operates a port/storage facility in Uruguay
and has in-house technical ship management expertise.

Navios Maritime Partners L.P. is a Marshall Islands limited
partnership formed by Navios to be an international owner and
operator of drybulk vessels.

                          *     *     *

Navios Maritime carries to date Moody's Investors Service's 'B1'
probability of default rating and 'B3' senior unsecured debt
rating, which were placed in March 2007.


NORTH STREET: Fitch Holds 'B' Rating on $31 Mil. Class C Notes
--------------------------------------------------------------
Fitch affirms six classes of notes issued by North Street
Referenced Linked Notes 2000-1, Ltd. and two classes of notes
issued by North Street Referenced Linked Notes 2002-1A, Ltd.

These rating actions are effective immediately:

North Street 2000-1

  -- $36,000,000 class A floating-rate notes affirmed at 'AA-';

  -- $40,000,000 class B floating-rate notes affirmed at
     'BBB-';

  -- $31,000,000 class C floating-rate notes affirmed at 'B',
     'DR1';

  -- $14,000,000 class D-1 floating-rate notes remain at
     'CC/DR5'

  -- $20,000,000 class D-2 fixed-rate notes remain at 'CC/DR5';

  -- Fixed Rate Income Notes remain at 'C/DR6'.
     North Street 2002-1A

  -- $50,000,000 class A floating-rate notes affirmed at 'AAA';

  -- $100,000,000 class B floating-rate notes affirmed at
     'AAA'.

North Street 2000-1, North Street 2002-1A and North Street 2000-1
senior credit linked notes are partially funded synthetic
collateralized debt obligations created to enter into credit
default swaps with UBS Investment Bank referencing the same
portfolio.  The reference portfolio consists of corporate bonds,
asset backed securities, and real estate investment trust
securities.

The affirmations are the result of the stable performance of the
reference portfolio.  Since Fitch's latest rating action on
Nov. 8, 2006, there have been no additional credit events in the
reference portfolio.  Currently there are no defaulted assets in
the portfolio.  Fitch Weighted Average Rating Factor  has remained
stable since last review.

The ratings of all classes of notes address the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the stated balance of
principal by the legal final maturity date.  The rating of the
Income Notes addresses the likelihood that investors will receive
full and timely payments of interest, at the rated coupon of 8%,
as well as the stated balance of principal by the legal final
maturity date.


NY RACING: Plan Confirmation Hearing Deferred to January 14
-----------------------------------------------------------
A hearing to consider confirmation of New York Racing
Association Inc.'s Third Amended Chapter 11 Plan of
Reorganization has been moved from from Dec. 27, 2007 to
Jan. 14, 2008, Bill Rochelle of Bloomberg News reports.

As reported in the Troubled Company Reporter on Dec. 3, 2007,
the Honorable James M. Peck the United States Bankruptcy Court
for the Southern District of New York approved the Debtor's
Third Amended Disclosure Statement describing its Plan of
dated Nov. 29, 2007.

Under the Third Amended Plan, Class 2 Secured Claim holders will
receive 100% of their allowed claim amount through any of these
distributions:

   a) payment of allowed secured claim in full, in cash;

   b) sale or disposition proceeds of the property securing any
      allowed secured claim to the extent of the value of
      their respective interests in the property; or

   c) surrender to the holder or holders of any allowed aecured
      claim of the property securing the claim.

Commencing on the effective date of the Plan, Unsecured Claims
will receive payments in full and in cash.

Holders of Insured Litigation Claims are entitled to:

   -- proceed with the liquidation of their claims, including
      any litigation pending as of the Debtor's bankruptcy
      filing; and

   -- seek recovery from applicable insurance carrier.

Pursuant to the terms of a settlement agreement, all State Claims
will be deemed allowed and each State Claims holder, other than
the holder of the New York State Tax Claim, will not be entitled
to, and will not receive or retain, any property or interest in
property on account of such Allowed State Claims under the Plan.

On or prior to the effective date of the Plan, the Debtor or the
Reorganized Debtor will make these payments to its benefit plans:

   1) funding deficiencies for the years ended on or prior to
      Dec. 31, 2006; and

   2) normal costs for the year ended Dec. 31, 2007.

By those payments, the Debtor's benefit plans will be deemed cured
and the Pension Benefit Guaranty Corporation's claims will be
deemed satisfied in full.

The Internal Revenue Service will receive a promissory note in the
amount of its allowed claim, which will bear interest at the rate
of 8% per annum, payable in 15 equal quarterly installments
commencing on March 31, 2008.

Each holder of an Allowed Penalty Claim will be entitled to
receive a pro rata share of cash available for distribution after
all allowed unsecured claims have been paid in full.

Equity Interests in the Debtor will be cancelled and holders of
such interests will not receive any distribution under the Plan.

                      About New York Racing

Based in Jamaica, New York, The New York Racing Association
Inc. aka NYRA -- http://www.nyra.com/-- operates racing tracks in
Aqueduct, Belmont Park and Saratoga.  The company filed for
chapter 11 protection on Nov. 2, 2006 (Bankr. S.D.N.Y. Case No.
06-12618).  Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP,
Henry C. Collins, Esq., at Cooper, Erving & Savage LLP, and
Irena M. Goldstein, Esq., at Dewey Ballantine LLP represent the
Debtor in its restructuring efforts.  Jeffrey S. Stein of The
Garden City Group Inc. serves as the Debtor's claims and noticing
agent.  Edward M. Fox, Esq., Eric T. Moser, Esq., and Jeffrey N.
Rich, Esq., at Kirkpatrick & Lockhart Preston Gates Ellis LLP,
represent the Official Committee of Unsecured Creditors.  When the
Debtor sought protection from its creditors, it listed more than
$100 million in total assets and total debts.


PACIFIC LUMBER: Loses Exclusive Right to File Reorganization Plan
-----------------------------------------------------------------
The Honorable Richard Schmidt of the U.S. Bankruptcy Court for the
Southern District of Texas has terminated Pacific Lumber Company
and its debtor affiliates' exclusive period to file a plan of
reorganization, according to Patrick Fitzgerald of the Associated
Press.

By virtue of the Court's Order, the Debtors have lost the
exclusive right to file a plan of reorganization last
Dec. 21,2007, and the Debtors' creditors are now permitted to file
competing plans.

"One way or another this case is going to be resolved around the
first of April," AP quotes Judge Schmidt.  Any competing plans
must be filed by Jan. 31, 2007, the Court ordered.  A confirmation
hearing is tentatively scheduled to begin on April 1, 2007.

The Bank of New York Trust Company, N.A., as indenture trustee
for the Timber Noteholders; Marathon Structured Finance L.P, the
Debtors' DIP Lender; and the Official Committee of Unsecured
Creditors have all expressed their intention to file competing
plans.  The Indenture Trustee previously submitted a proposed
plan, which contemplates a sale of the Debtors' assets.  Marathon
has recently informed the Court that it has solicited the support
of Mendocino Redwood Co. LLC for a possible infusion of about
$200 million of new cash equity to support a reorganization plan
for the Debtors.

In a separate report, the Eureka Reporter relates that PALCO
expected the Court's ruling.  According to the company's vice
president, Frank Bacik, "our only stipulation was that [any
competing plan] be filed in [a] timely manner.".

Nevertheless, Mr. Bacik reiterates that PALCO's plan is the only
plan that provides for the full payment of its creditors.

The Eureka Reporter added that Judge Schmidt has directed all
parties to come up with a joint disclosure statement by Feb. 28,
whereby they must all agree on how PALCO, its creditors and other
key parties will vote to confirm one of any competing plan filed.

Judge Schmidt considered the Debtors' exclusivity at a hearing on
Dec. 21, 2007, as per the Indenture Trustee's request.  The
Indenture Trustee reasoned that since the parties have twice
fully presented their evidence on the Exclusivity Motion, and
since the Court-ordered mediation has been concluded, the
Exclusivity Motion was ripe for determination and should be
decided one way or the other.

                     About Pacific Lumber

Based in Oakland, California, The Pacific Lumber Company --
http://www.palco.com/-- and its subsidiaries operate in several
principal areas of the forest products industry, including the
growing and harvesting of redwood and Douglas-fir timber, the
milling of logs into lumber and the manufacture of lumber into a
variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jack L. Kinzie, Esq., at Baker
Botts LLP, is Pacific Lumber's lead counsel.  Nathaniel Peter
Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan,
Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific
Lumber's co-counsel.  Kathryn A. Coleman, Esq., and Eric J.
Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia
Pacific's lead counsel.  John F. Higgins, Esq., and James Matthew
Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co-
counsel.  John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones
LLP, represents the Official Committee of Unsecured Creditors.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.  The Debtors filed their Joint Plan of
Reorganization on Sept. 30, 2007.  The Debtors' exclusive period
to file a chapter 11 plan expired on the same date.

(Scotia/Pacific Lumber Bankruptcy News, Issue No. 39,
http://bankrupt.com/newsstand/or 215/945-7000).


PACIFIC LUMBER: Scopac Can Use Funds in SAR Account for 2nd Budget
------------------------------------------------------------------
The Honorable Richard Schmidt approved Pacific Lumber Company
subsidiary Scotia Pacific Company's request to use cash collateral
funds from the Scheduled Amortization Reserve Account in
accordance with a Second Additional Budget.  The Court also
authorized and directed The Bank of New York Trust Company, N.A.,
as Indenture Trustee for the Timber Notes, to grant Scopac access
to the SAR account for that purpose.  The Court finds that good
cause exists for the approval of the Second Additional Budget for
Scopac's cash collateral use.

               BONY Objects to Cash Collateral Use

Bony reiterated that Scopac's request for further cash collateral
use compromises the adequate protection of its collateral.

Scopac's recent Second Additional Budget shows a negative ending
book cash necessitating the company to draw from its Scheduled
Amortization Reserve Account, Zack A. Clement, Esq., at Fulbright
& Jaworski L.L.P, in Houston, Texas, contended.  "The SAR Account
from which Scopac now proposes to withdraw funds is not a savings
account for [Scopac] to freely draw upon to sustain its
operations," he emphasizes.

The SAR account was established as a credit enhancement for the
Timber Notes to reserve $169,000,000 of the proceeds of the sale
of the Indenture Trustee's collateral under the Headwaters
Agreement, Mr. Clement clarifies.  It was established, he pointed
out, for the sole purpose of ensuring that Scopac paid the
scheduled amortization of principal on the Timber Notes on each
Note Payment Date; the funds in the account were only to be used
to the extent that Scopac did not have sufficient funds to
satisfy the amortization payments.

However, as of the week following the hearing on the Cash
Collateral Motion, Scopac's ending cash balance will continue to
plummet.  By the last week of December 2007, Scopac proposes to
begin to draw on the SAR Account, draining away millions of
dollars of the cash collateral securing the Indenture Trustee's
claim, Mr. Clement told the Court.

Certain factors lead Scopac to propose to use the SAR Account,
Mr. Clement noted:

   * There is a continuous decline of timber market price.  In
     percentage terms, the actual market prices for timber are
     18% lower than the assumptions on which the Amended Second
     Additional Budget is based.

   * Scopac's ties with the Pacific Lumber Company also affects
     its Second Additional Budget since PALCO is in danger of
     becoming administratively insolvent.  PALCO is running out
     of money to buy Scopac's logs and faces a bad market for the
     sale of timber and lumber.  PALCO's recent budget indicates
     that at the end of December, it will have only $1,000 in
     availability.  PALCO is relying on log sales to third
     parties for almost 38% of its gross revenue during the first
     six months of 2008.  PALCO's ability to meet those
     projections is further imperiled because Scopac has
     apparently harvested logs at a much lower rate than it had
     projected.

   * A significant reason for Scopac's cash drain is its
     extraordinary high professional fees in the case.  Scopac's
     most recent Monthly Operating Report shows that it has spent
     $15,228,000 for professional fees.  It is more than 45% of
     its gross revenue and more than 78% of EBITDAR for
     professional fees.

In addition, the Debtors have recently sought Court approval of
trial for the valuation of the Timber Noteholders' claim.
Implied in the Debtors' request for sequential valuation trials
is the assumption that exclusivity would continue during the long
and expensive valuation process, Mr. Clement noted.  By the end
of the proposed valuation hearings, in the likely event that the
evidence shows that the Indenture Trustee is undersecured, its
cash collateral will have been wasted and Scopac will be out of
cash, threatening the ability to sell the company as a going
concern, Mr. Clement argued.

Even in the unlikely event that Scopac is able to convince the
Court that the Indenture Trustee is theoretically oversecured,
Scopac would still have to expend additional time and cash
collateral attempting to obtain approval of a disclosure
statement and confirmation of a plan, while responding to the
Indenture Trustee's expedited appeal of the valuation finding,
Mr. Clement asserted.

The Indenture Trustee maintained that a better way to yield
results on the Debtors' cases is to establish actual values of
the Debtors' assets by pursuing parallel sales of the assets of
Scopac and PALCO as going concerns.  "A robust sales process
could be conducted at greatly reduced expense in the same amount
of time as would be necessary to try all of the valuation issues
as the Debtors attempt to confirm their patently unconfirmable
plan," Mr. Clement contended.

If the Court orders a sale process to go forward that will
conclude in the next few months, it will provide the Indenture
Trustee the indubitable equivalence of its claim as adequate
protection for the use of its cash collateral during the Chapter
11 case, Mr. Clement pointed out.

Accordingly, the Indenture Trustee did not consent to Scopac's
further use of cash collateral as proposed in the Amended Second
Additional Budget.

However, if the Court authorizes Scopac to use cash collateral,
the Indenture Trustee had asked Judge Schmidt to prohibit or
condition its use and provide adequate protection by:

   (a) requiring Scopac to file an amended budget and a new
       long-term business plan showing a reasonable strategy to
       eliminate its ongoing losses;

   (b) prohibiting the use of cash collateral by Scopac to fund
       valuation trials or oppose the Creditor Plans and instead
       requiring the beneficiary, MAXXAM, to pay the
       professional fees associated with the proposed trials;

   (c) terminating exclusivity to permit the Indenture Trustee
       and the Official Committee of Unsecured Creditors
       Committee to propose parallel plans for Scopac and PALCO;
       and

   (d) ordering as adequate protection that a sale process begin
       immediately for Scopac and PALCO so that the assets of
       these two companies can be sold promptly while they are
       both still going concerns.

            BoNY Seeks to Strike Certain Expert Reports

The Indenture Trustee had also asked the Court to strike the
expert reports of Dr. Kim Iles and Dr. Don Reimer and exclude the
testimony of James Yerges.

Rule 26(a)(2)(B) of the Federal Rules of Civil Procedure provides
that a party must disclose to the other parties the identity of
any witness it may use at trial to present evidence.  Civil Rule
37 states that if a party fails to provide information or
identify a witness as required by Rule 26(a) or (e), that party
is not allowed to use that information or witness to supply
evidence on a motion at a hearing, Mr. Clement noted.

Mr. Clement recounted that the Debtors informed the Indenture
Trustee on Dec. 18, 2007, that it will submit to the Court
the testimony of Mr. Yerges, Jeffrey Barrett, and Gary Clark in
anticipation of the December 21 Cash Collateral Hearing.
Subsequently, the Debtors tendered, on December 20, separate
expert reports of Drs. Iles and Reimer along with Mr. Yerges'
written report.

Mr. Clement argued that the participation of Drs. Iles and Reimer
in giving an expert testimony was not properly disclosed by the
Debtors.

Furthermore, Mr. Yerges testified on December 20 that he relied
on the conclusions of Drs. Iles and Reimer in order to derive his
opinion about the level of harvest that could be expected from
Scopac's timberlands, and likewise his opinion about the value of
the Timberlands.  Mr. Yerges' written report concluded that the
value of the Timberlands cost $950,000,000.  However, $33,000,000
of the value opinion given by Mr. Yerges is based on his reliance
on Dr. Reimer's opinion, Mr. Clement pointed out.

The Debtors' failure to both designate Drs. Iles and Reimer as
witnesses for the December 21 hearing, and to offer those experts
for depositions contravenes the Civil Rules and is prejudicial to
the Indenture Trustee, Mr. Clement contended.  "Allowing their
findings into evidence through the testimony of another witness
would improperly circumvent the procedural protections embodied
in the Federal Rules," he maintained.

A full-text copy of the Scopac's Weekly Cash Flow Budget through
the week ending March 21, 2008 is available for free at:

  http://bankrupt.com/misc/SCOPACWeeklyBudgetthruMar21-08.pdf

                       About Pacific Lumber

Based in Oakland, California, The Pacific Lumber Company --
http://www.palco.com/-- and its subsidiaries operate in several
principal areas of the forest products industry, including the
growing and harvesting of redwood and Douglas-fir timber, the
milling of logs into lumber and the manufacture of lumber into a
variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jack L. Kinzie, Esq., at Baker
Botts LLP, is Pacific Lumber's lead counsel.  Nathaniel Peter
Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan,
Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific
Lumber's co-counsel.  Kathryn A. Coleman, Esq., and Eric J.
Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia
Pacific's lead counsel.  John F. Higgins, Esq., and James Matthew
Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co-
counsel.  John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones
LLP, represents the Official Committee of Unsecured Creditors.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.  The Debtors filed their Joint Plan of
Reorganization on Sept. 30, 2007.  The Debtors' exclusive period
to file a chapter 11 plan expired on the same date.

(Scotia/Pacific Lumber Bankruptcy News, Issue No. 39,
http://bankrupt.com/newsstand/or 215/945-7000).


PERFORMANCE TRANS: Gets Interim Nod to Use $6 Mil. DIP Funding
--------------------------------------------------------------
Performance Transportation Services Inc. and its debtor-
affiliates obtained interim authority from the U.S. Bankruptcy
Court for the Western District of New York to borrow $6 million in
debtor-in-possession financing from Black Diamond Commercial
Finance LLC.

Previously, the Debtors requested to secure $15 million in DIP
facility.  The Debtors will use the loan proceeds for working
capital and other general corporate purposes.

The Court authorized the Debtors to incur overdrafts and related
liabilities arising from treasury, depository and cash management
services; provided, however, that nothing will require Black
Diamond or any other party to incur overdrafts or to provide any
services or functions to the Debtors.

The Debtors are also authorized to pay all fees that may be
necessary for the Debtors' performance of their obligations under
the DIP Facility.

All of the DIP Obligations will constitute allowed claims against
the Debtors with priority over any and all administrative
expenses, diminution claims and all other claims against the
Debtors, Judge Lewis Kaplan said.  The DIP Lenders will have a
first lien on the Debtors' cash balances and unencumbered
property, excluding the Debtors' avoidance actions and related
proceeds.

The DIP Liens are subject to he payment of a carve-out for
fees payable to the Clerk of the Bankruptcy Court, the Office of
the United States Trustee, and the bankruptcy professional
retained in the Debtors' cases; and any liens permitted pursuant
to the DIP Loan Documents.

As adequate protection of the prior to bankruptcy filing secured
lenders' interest, Judge Kaplan granted the agents and the secured
lenders prior to bankruptcy filing, subject to the payment of the
Carve-Out, a superpriority claim, immediately junior to the claims
held by the DIP agent and the DIP lenders.

However, the agents and the secured lenders will not receive or
retain any payments, property or other amounts unless and until
the DIP Obligations have indefeasibly been paid in cash in full.

The administrative agent under the Debtors' first lien credit and
guaranty agreement will receive from the Debtors immediate cash
payment of all interest accrued and unpaid as of the bankruptcy
filing on the unpaid principal balance of the loans outstanding
under the first lien facility and letter of credit fees at the
default rate provided for under the first lien credit agreement
and all other accrued and unpaid fees and disbursements owing to
the first lien agent and incurred prior to bankruptcy filing.

The administrative agent under the Debtors' second lien credit
and guaranty agreement will accrue in respect of interest
payments due under the Second lien facility, an amount equal to
the alternate base rate plus the default rate, which will be added
to the principal balance of the obligations due under the second
lien facility.

The accrual of interest in respect of loans under the second lien
facility will be provisional and conditioned on the first lien
secured lenders being paid in full.

The Debtors will pay for the pre-bankruptcy filing secured
lenders' legal costs and expenses.

Any committee of unsecured creditors will have 60 days from the
bankruptcy filing to file objections or complaints respecting the
validity, extent, priority, avoidability or enforceability of the
debt prior to bankruptcy filing.

The Court will convene a final hearing regarding the Debtors'
request on Jan. 18, 2008, at 10:00 a.m.

                            About PTS

Performance Transportation Services, Inc. is the second largest
transporter of new automobiles, sport-utility vehicles and light
trucks in North America, and operates under three key
transportation business lines including: E. and L. Transport,
Hadley Auto Transport and Leaseway Motorcar Transport.

The company and 13 of its affiliates previously filed for Chapter
11 protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Lead Case No. 06-
00107). The Court confirmed the Debtors' plan on Dec. 21, 2006,
and that plan became effective on Jan. 29, 2007. Garry M. Graber,
Esq. of Hodgson, Russ LLP and Tobias S. Keller, Esq. of Jones Day
represented the Debtors in their retructuring efforts.  When the
Debtor filed for protection from their creditors it reported more
than $100,000,000 in total assets. It also disclosed owing more
than $100,000,000 to at most 10,000 creditors, including $708,679
to Broadspire and $282,949 to General Motors of Canada Limited.

The company and its debtor-affiliates filed their second Chapter
11 bankruptcy on Nov. 19, 2007 (Bankr. W.D.N.Y. Case Nos: 07-04746
thru 07-04760).  Tobias S. Keller, Esq., at Jones Day, represents
the Debtors.  Garry M. Graber, Esq., at Hodgson, Russ LLP, serve
as the Debtors' local counsel.  The Debtors' claims & balloting
agent is Kutzman Carson Consultants LLC.  (Performance Bankruptcy
News, Issue No. 35; Bankruptcy Creditors' Services Inc.;
http://bankrupt.com/newsstand/ or 215/945-7000).


PERFORMANCE TRANS: Lenders Want Yucaipa, et al. to Produce Docs
---------------------------------------------------------------
D.E. Shaw Laminar Portfolios L.L.C. and Quadrangle Debt Recovery
Advisors LP, lenders of Performance Transportation Services Inc.
and its debtor-affiliates, asks the U.S. Bankruptcy Court for the
Western District of New York, to serve document requests on and to
take certain specified depositions from:

   1. the members of the Debtors' board of directors who also
      serve as directors at Yucaipa -- Derex Walker; Ira
      Tochner; Jos Opdeweegh; and Jeff Pelletier;

   2. Yucaipa;

   3. Allied; and

   4. Goldman Sachs.

Yucaipa American Alliance Fund I, LP and Yucaipa American Alliance
(Parallel) Fund I, LP are the Debtors' controlling shareholders.

Goldman Sachs Credit Partners, L.P. is the Debtors' lead arranger
and initial agent of their secured debt.

D.E. Shaw and Quadrangle are majority lenders under the Debtors'
Second Lien Credit and Guaranty Agreement dated January 26, 2007.
D.E. Shaw and Quadrangle are owed roughly $35,000,000 under the
Second Lien Facility.

D.E. Shaw and Quadrangle Debt want to obtain information
concerning the property of the Debtors; the assets, liabilities
and financial condition of the Debtors; matters that may affect
administration of the Debtors' cases; and certain claims that may
be asserted against third parties by a representative of the
Debtors' estates.

Daniel Brockett, Esq., at Quinn Emanuel Urquhart Oliver & Hedges
LLP, in New York, tells the Court that:

   1. the Debtors' Chapter 11 cases are replete with conflicts
      of interests;

   2. the Debtors' Chapter 11 cases were commenced to realize
      Yucaipa's merger goals;

   3. Yucaipa has possibly usurped the Debtors' corporate
      opportunities; and

   4. the reasonableness and good faith of the projections in
      Goldman Sachs' Exit Financing Confidential Information
      Memorandum in the Debtors' Chapter 11 cases is
      questionable.

Mr. Brockett notes that the Debtors and Allied Systems Holdings
Inc., have interlocking directors, reflecting Yucaipa's control
of both entities.  Four of the five members of Allied's board are
Yucaipa designees and all five directors on the Debtors' board are
Yucaipa designees.  Three members of the Debtors' board also sit
on Allied's board and a fourth member is a principal of Yucaipa.

The Second Lien Lenders want to determine:

   1. conflicts of interests arising from Yucaipa's ownership
      and control of both Allied and the Debtors, and the
      extent to which the conflicts have affected and may
      affect the ability of the Debtors' board of directors to
      execute their fiduciary duties for the benefit of
      creditors of the Debtors;

   2. the role that certain third parties, including Yucaipa,
      may have played in driving the Debtors back into
      bankruptcy on the heels of their recent reemergence and
      the extent to which Yucaipa misused the bankruptcy
      process for the purpose of furthering its goal of merging
      the Debtors and Allied;

   3. Yucaipa's dealings and relationship with the
      International Brotherhood of Teamsters and whether
      certain of the Debtors' directors, who are also
      affiliated with Yucaipa, may have diverted and usurped
      corporate opportunities, namely, the opportunity to
      negotiate for wage concessions with the IBT, that should
      have been brought to and pursued by the Debtors prior to
      the filing of the Chapter 11 cases;

   4. financial information included in the Confidential
      Information Memorandum, entities who may have had a role
      in the preparation of the CIM, and the extent to which
      the information was unreasonable or lacked good faith;
      and

   5. the identification of potential claims against third
      parties for the benefit of the Debtors' estates.

The CIM, which Goldman Sachs disseminated to prospective lenders,
contained detailed projections, forecast assumptions, and other
financial information about PTS, and conveyed the impression that
PTS was well positioned to emerge from Chapter 11 as a profitable
entity.

Since emerging from bankruptcy on Jan. 26, 2007, however, the
Debtors have missed every financial projection contained in the
CIM, raising fair questions about the reasonableness and good
faith of those projections and the entities that may have been
involved in preparing them, the Second Lien Lenders point out.
Given Goldman Sachs' role as Sole Lead Arranger, it is in
possession of information that may provide answers to those
questions, the Second Lien Lenders say.

                            About PTS

Performance Transportation Services, Inc. is the second largest
transporter of new automobiles, sport-utility vehicles and light
trucks in North America, and operates under three key
transportation business lines including: E. and L. Transport,
Hadley Auto Transport and Leaseway Motorcar Transport.

The company and 13 of its affiliates previously filed for Chapter
11 protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Lead Case No. 06-
00107). The Court confirmed the Debtors' plan on Dec. 21, 2006,
and that plan became effective on Jan. 29, 2007. Garry M. Graber,
Esq. of Hodgson, Russ LLP and Tobias S. Keller, Esq. of Jones Day
represented the Debtors in their retructuring efforts.  When the
Debtor filed for protection from their creditors it reported more
than $100,000,000 in total assets. It also disclosed owing more
than $100,000,000 to at most 10,000 creditors, including $708,679
to Broadspire and $282,949 to General Motors of Canada Limited.

The company and its debtor-affiliates filed their second Chapter
11 bankruptcy on Nov. 19, 2007 (Bankr. W.D.N.Y. Case Nos: 07-04746
thru 07-04760).  Tobias S. Keller, Esq., at Jones Day, represents
the Debtors.  Garry M. Graber, Esq., at Hodgson, Russ LLP, serve
as the Debtors' local counsel.  The Debtors' claims & balloting
agent is Kutzman Carson Consultants LLC.  (Performance Bankruptcy
News, Issue No. 35; Bankruptcy Creditors' Services Inc.;
http://bankrupt.com/newsstand/ or 215/945-7000).


PERFORMANCE TRANS: Committee Can Hire Blank Rome as its Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors in Performance
Transportation Services Inc. and its debtor-affiliates' Chapter 11
cases obtained authority from the U.S. Bankruptcy Court for the
Western District of New York to retain Blank Rome LLP as its
counsel, nunc pro tunc to Nov. 29, 2007.

Blank Rome is expected to perform legal services for the Committee
that are necessary or appropriate in connection with the Debtors'
chapter 11 cases.

The Committee tells the Court that Blank Rome will be paid on an
hourly basis in accordance with the firm's ordinary and customary
hourly rates:

     Professional                    Rate
     ------------                    ----
     Marc E. Richards, Esq.          $650
     Paul A. Friedman, Esq.          $625
     Raymond M. Patella, Esq.        $405
     Melissa S. Vongtama, Esq.       $345
     Partners and Counsel            $380 - $745
     Associates                      $105 - $280

Marc E. Richards, Esq., a partner at Blank Rome LLP, in New York,
assures the Court that his firm is a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code and
as required by Section 327(a) of the Bankruptcy Code.

Performance Transportation Services, Inc. is the second largest
transporter of new automobiles, sport-utility vehicles and light
trucks in North America, and operates under three key
transportation business lines including: E. and L. Transport,
Hadley Auto Transport and Leaseway Motorcar Transport.

The company and 13 of its affiliates previously filed for Chapter
11 protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Lead Case No. 06-
00107). The Court confirmed the Debtors' plan on Dec. 21, 2006,
and that plan became effective on Jan. 29, 2007. Garry M. Graber,
Esq. of Hodgson, Russ LLP and Tobias S. Keller, Esq. of Jones Day
represented the Debtors in their retructuring efforts.  When the
Debtor filed for protection from their creditors it reported more
than $100,000,000 in total assets. It also disclosed owing more
than $100,000,000 to at most 10,000 creditors, including $708,679
to Broadspire and $282,949 to General Motors of Canada Limited.

The company and its debtor-affiliates filed their second Chapter
11 bankruptcy on Nov. 19, 2007 (Bankr. W.D.N.Y. Case Nos: 07-04746
thru 07-04760).  Tobias S. Keller, Esq., at Jones Day, represents
the Debtors.  Garry M. Graber, Esq., at Hodgson, Russ LLP, serve
as the Debtors' local counsel.  The Debtors' claims & balloting
agent is Kutzman Carson Consultants LLC.  (Performance Bankruptcy
News, Issue No. 35; Bankruptcy Creditors' Services Inc.;
http://bankrupt.com/newsstand/ or 215/945-7000).


PHYTOMEDICAL TECH: Posts $353,094 Net Loss in Third Quarter
-----------------------------------------------------------
Phytomedical Technologies Inc. reported a net loss of $353,094 for
the third quarter ended Sept. 30, 2007, compared with a net loss
of $993,923 in the same period last year.

The company has yet to establish any history of profitable
operations.  The company had no revenues during the last three
fiscal years and it does do not expect to generate revenues from
operations for the foreseeable future.

At Sept. 30, 2007, the company's consolidated balance sheet showed
$3.14 million in total assets, $1.66 million in total liabilities,
and $1.48 million 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?26b1

                       Going Concern Doubt

Peterson Sullivan PLLC, in Seattle, expressed substantial doubt
about PhytoMedical Technologies 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 recurring losses from
operations since inception and substantial accumulated deficit.

                 About PhytoMedical Technologies

Headquartered in Princeton, N.J., PhytoMedical Technologies Inc. -
- http://www.PhytoMedical.com/-- (OTCBB: PYTO; Frankfurt Stock
Exchange: ET6) together with its wholly owned subsidiaries, is a
pharmaceutical company focused on research, development and
commercialization of pharmaceutical products.


POPE & TALBOT: Canada Court OKs Bid Procedures for Pulp Business
----------------------------------------------------------------
The British Columbia Supreme Court has approved Pope & Talbot Inc.
and its debtor-affiliates' proposed bidding procedures for their
pulp business assets, and authorized the Debtors to schedule an
auction, if necessary.

The Canadian Court held that the Bidding Procedures will govern
the Auction, which is intended to solicit bids for the Debtors'
Pulp Business.

As reported in the Troubled Company Reporter on Dec. 14, 2007,
the Hon. Christopher S. Sontchi of the United States Bankruptcy
Court for the District of Delaware had earlier approved in all
respects the Debtors' bidding and sale procedures with respect to
the sale of their pulp business assets, including:

   (1) the submission, consideration, qualification and
       acceptance of Qualified Overbids submitted to the Debtors;

   (2) the Auction; and

   (3) the identification and determination of the Successful Bid
       and the Back-Up Bid.

                       About Pope & Talbot

Headquartered in Portland, Oregon, Pope & Talbot Inc. (Other OTC:
PTBT.PK) -- http://www.poptal.com/-- is a pulp and wood products
business.  Pope & Talbot was founded in 1849 and produces market
pulp and softwood lumber at mills in the US and Canada.  Markets
for the company's products include the US, Europe, Canada, South
America and the Pacific Rim.

The company and its U.S. and Canadian subsidiaries applied for
protection under the Companies' Creditors Arrangement Act of
Canada on Oct. 28, 2007.  The Debtors' CCAA Stay expires
on Jan. 16, 2008.

The company and fourteen of its debtor-affiliates filed for
Chapter 11 protection on Nov. 19, 2007 (Bankr. D. Del. Lead Case
No. 07-11738).  Shearman & Sterling LLP is the Debtor's bankruptcy
counsel, while Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl
& Jones L.L.P. represents the Debtors as bankruptcy co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$681,960,000 and total debts of $601,090,000.

The Debtors' exclusive period to file a plan expires on March 18,
2008.

Pope & Talbot Pulp Sales Europe, LLC, a subsidiary, on Nov. 21,
2007, filed an application for relief under Belgian bankruptcy
laws in the commercial court in Brussels.  If the Belgian court
grants Pope & Talbot Europe's application, it is expected it will
be liquidated through the bankruptcy proceeding.  (Pope & Talbot
Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


POPE & TALBOT: Bid Protocol for Remaining Wood Business Approved
----------------------------------------------------------------
The British Columbia Supreme Court has approved Pope & Talbot Inc.
and its debtor-affiliates' proposed bidding procedures for the
sale of their remaining wood products business.

The Canadian Court likewise authorized the Debtors to schedule an
auction, if necessary, to solicit bids for their Remaining Wood
Products Business.

As reported in the Troubled Company Reporter on Dec. 14, 2007,
the United States Bankruptcy Court for the District of Delaware
had earlier approved in all respects the Debtor's bidding and sale
procedures with respect to the sale of certain wood products
assets not contemplated to be sold to International Forest
Products and the assumption of related liabilities, including:

   (1) the submission, consideration, qualification and
       acceptance of Qualified Overbids submitted to the Debtors;

   (2) the Auction; and

   (3) the identification and determination of the Successful Bid
       and the Back-Up Bid.

                      About Pope & Talbot

Headquartered in Portland, Oregon, Pope & Talbot Inc. (Other OTC:
PTBT.PK) -- http://www.poptal.com/-- is a pulp and wood products
business.  Pope & Talbot was founded in 1849 and produces market
pulp and softwood lumber at mills in the US and Canada.  Markets
for the company's products include the US, Europe, Canada, South
America and the Pacific Rim.

The company and its U.S. and Canadian subsidiaries applied for
protection under the Companies' Creditors Arrangement Act of
Canada on Oct. 28, 2007.  The Debtors' CCAA Stay expires
on Jan. 16, 2008.

The company and fourteen of its debtor-affiliates filed for
Chapter 11 protection on Nov. 19, 2007 (Bankr. D. Del. Lead Case
No. 07-11738).  Shearman & Sterling LLP is the Debtor's bankruptcy
counsel, while Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl
& Jones L.L.P. represents the Debtors as bankruptcy co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$681,960,000 and total debts of $601,090,000.

The Debtors' exclusive period to file a plan expires on March 18,
2008.

Pope & Talbot Pulp Sales Europe, LLC, a subsidiary, on Nov. 21,
2007, filed an application for relief under Belgian bankruptcy
laws in the commercial court in Brussels.  If the Belgian court
grants Pope & Talbot Europe's application, it is expected it will
be liquidated through the bankruptcy proceeding.  (Pope & Talbot
Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


POPE & TALBOT: Court Approves KPMG LLP as Independent Auditor
-------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
has granted Pope & Talbot Inc. and its debtor-affiliates
permission to employ KPMG LLP as their independent auditor,
effective as of Nov. 19, 2007.

The Hon. Christopher S. Sontchi held that KPMG will not retain any
third parties, including affiliates, without approval of the
Court.

As reported in the Troubled Company Reporter on Dec. 5, 2007, the
Debtors told the Court that that KPMG's diverse experience and
extensive knowledge in the field of accounting will be of much
help to their restructuring plans.

As the Debtors' financial advisors, KPMG will:

   -- audit the Debtors' consolidated financial statements and
      internal control over financial reporting;

   -- review the Debtors' condensed consolidated balance sheets
      and related condensed consolidated statements of operations
      and cash flows as well as selected quarterly financial
      data;

   -- perform procedures required by the standards of the Public
      Company Accounting Oversight Board (United States),
      including reading information incorporated by reference in
      the Debtors' previously filed registration statements and
      performing subsequent event procedures;

   -- audit the Debtors' Pension Plan and Tax Deferred Savings
      Plan; and

   -- perform additional audit services that may be requested by
      the Debtors from time to time during the pendency of their
      Chapter 11 cases.

The Debtors will pay for KPMG's general auditing services
according to the firm's customary hourly rates:

             Professional                Hourly Rate
             ------------                -----------
             Partners                       $360
             Managers                       $270
             Senior Associates              $200
             Staff                          $120
             Assistant                      $100

KPMG will be paid these amounts with respect to auditing services
related to the Debtors' pension and tax deferred savings plans:

             Professional                Hourly Rate
             ------------                -----------
             Partners                       $300
             Managers                       $200
             Senior Associates              $150
             Staff/Assistant                $110

Timothy McCann, a certified public accountant at KPMG, assured
the Court that his firm is a "disinterested person," as the term
is defined in Section 101(14) of the Bankruptcy Code.

                       About Pope & Talbot

Headquartered in Portland, Oregon, Pope & Talbot Inc. (Other OTC:
PTBT.PK) -- http://www.poptal.com/-- is a pulp and wood products
business.  Pope & Talbot was founded in 1849 and produces market
pulp and softwood lumber at mills in the US and Canada.  Markets
for the company's products include the US, Europe, Canada, South
America and the Pacific Rim.

The company and its U.S. and Canadian subsidiaries applied for
protection under the Companies' Creditors Arrangement Act of
Canada on Oct. 28, 2007.  The Debtors' CCAA Stay expires
on Jan. 16, 2008.

The company and fourteen of its debtor-affiliates filed for
Chapter 11 protection on Nov. 19, 2007 (Bankr. D. Del. Lead Case
No. 07-11738).  Shearman & Sterling LLP is the Debtor's bankruptcy
counsel, while Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl
& Jones L.L.P. represents the Debtors as bankruptcy co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$681,960,000 and total debts of $601,090,000.

The Debtors' exclusive period to file a plan expires on March 18,
2008.

Pope & Talbot Pulp Sales Europe, LLC, a subsidiary, on Nov. 21,
2007, filed an application for relief under Belgian bankruptcy
laws in the commercial court in Brussels.  If the Belgian court
grants Pope & Talbot Europe's application, it is expected it will
be liquidated through the bankruptcy proceeding.  (Pope & Talbot
Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


POWERLINX INC: Sept. 30 Balance Sheet Upside-Down by $3.16 Million
------------------------------------------------------------------
Powerlinx Inc.'s consolidated balance sheet at Sept. 30, 2007,
showed $1.65 million in total assets and $4.81 million in total
liabilities, resulting in a $3.16 million total stockholders'
deficit.

At Sept. 30, 2007, the company's consolidated balance sheet also
showed strained liquidity with $1.26 million in total current
assets available to pay $4.81 million in total current
liabilities.

The company reported a net loss of $901,006 on net revenue of
$573,086 for the third quarter ended Sept. 30, 2007, compared with
a net loss of $584,781 on net revenue of $1.00 million in the same
period last year.

Operating expenses of $988,751 for the three months ended
Sept. 30, 2007, increased 24% compared to operating expenses for
the same period ended Sept. 30, 2006.  Loss from operations of
$721,474 for the three months ended Sept. 30, 2007, increased 37%
compared to the same period ended Sept. 30, 2006.

The primary reason for the decrease in net revenues was due to a
one time significant sale to a large retailer in the previous
comparative period.   The increase in operating expenses and net
loss from operations was due primarily from stock based
compensation to consultants for services provided in conjunction
with the launch of the company's new product line and promotion of
the company within the consumer electronics industry.

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?26ad

                       Going Concern Doubt

As reported in the Troubled Company Reporter on May 10, 2007,
Aidman, Piser & Company PA, in Tampa, Florida, expressed
substantial doubt about Powerlinx Inc.'s ability to continue as a
going concern after auditing the company's financial statements
for the years ended Dec. 31, 2006, and 2005.  The auditor pointed
to the company's recurring losses, strained liquidity, and
stockholders' deficit.

                        About Powerlinx

Headquartered in St. Petersburg, Florida, PowerLinx Inc.
(OTC BB: PWLX) -- http://www.power-linx.com/-- develops,
manufactures and markets products and applications that transmit
voice, video, audio and data either individually or in any and all
combinations over power lines, twisted-pair wires and coax in AC
and DC power environments, on any and all power grids.  The
company has also developed, manufactured, and marketed different
kinds of underwater video cameras, lights and accessories for the
marine, commercial and consumer retail markets as well as accident
avoidance systems for small and large vehicles.


PUTNAM CBO: Fitch Retains 'CC' Rating on Second Priority Notes
--------------------------------------------------------------
These rating action is a result of Fitch's review process and is
effective immediately, Putnam CBO II, Limited:

  -- $58,131,390 second priority senior notes remain at
     'CC/DR4'.

Putnam CBO II is a collateralized debt obligation which closed in
November 1997 and is managed by Putnam Advisory Company LLC.
Putnam CBO II is backed by a portfolio comprised primarily of high
yield corporate bonds and emerging market sovereign debt.   The
transaction exited its reinvestment period in November 2002 and is
currently amortizing.

The rating action is a result of continued deleveraging of the
structure and the full redemption of the senior notes, which paid
in full on the Aug. 8, 2007 payment date.  The second priority
senior notes have capitalized over $15 million of interest
payments in the past, though they are receiving currently
receiving full interest payments due a structural feature which
allows for principal proceeds to be used to cover interest
shortfalls to these notes.  As Nov. 1, 2007, the second priority
interest coverage ratio was at 34.46% versus a minimum trigger of
112.78%, and is not expected to be cured.   Principal proceeds
will continue to be diverted to pay second priority interest,
diminishing the ultimate principal recovery on these notes.  The
second priority principal par value ratio was at 40.48% versus a
minimum trigger of 106.5%.

The rating of the senior notes addresses the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the stated balance of
principal by the legal maturity date.  The rating of the second
priority senior notes addresses the likelihood that investors will
receive ultimate and compensating interest payments, as per the
governing documents, as well as the stated balance of principal by
the legal final maturity date.


RCN CORP: Inks New 3-Year Pact w/ Peter Aquino as President & CEO
-----------------------------------------------------------------
RCN Corporation renewed Peter D. Aquino as president and chief
executive officer pursuant to the terms of a new, three-year
agreement.  James F. Mooney, who has served as executive chairman
of RCN since 2005,  completed his service under the terms of his
employment contract, and decided to retire from the board.
Michael E. Katzenstein, an independent member of the board of
directors, was named non-executive chairman of the board.

"With the completion of RCN's financial turnaround, and the
demonstrated effectiveness of Pete Aquino and the rest of the RCN
management team, the time is right for me to step away from RCN to
focus on my other business endeavors," Mr. Mooney stated.  "I am
very proud that I leave RCN as a far stronger business than when I
arrived, and I have the greatest confidence that the management
team will continue to deliver growth and value to shareholders
under Pete Aquino's leadership."

"I would like to thank Jim for his guidance and leadership as
executive chairman," Mr. Aquino stated.  "RCN is well-positioned
to continue its record of sound performance as we execute our
strategy of continuously upgrading our customer's service quality
and experience, maintaining industry-leading video and broadband
products, and capturing the residential, commercial, carrier, and
small business opportunities available to us as a result of our
investments in network growth and the acquisition of synergistic
businesses.  With continued effective execution, RCN will become
an increasingly competitive total telecommunications provider in
the population-dense, highly profitable region between Boston,
Chicago, Eastern Pennsylvania, New York, and Washington, D.C."

The company's board of directors has elected Michael E.
Katzenstein, an independent director serving on the board, to
serve as non-executive chairman.

"The board of directors joins me in extending its sincerest
appreciation to Jim Mooney for his service," Mr. Katzenstein
stated.  "Jim joined RCN to lead its new management team three
years ago when the company emerged from bankruptcy, and has built
a solid record of consistent execution and performance,
highlighted by the company's sale of its significant holding in
Megacable, its 2007 recapitalization and return of capital, and
its diversification into the commercial/carrier business through
the acquisitions of ConEd Communications and NEON, making it a
significant Northeast corridor telecommunications player."

"Following its financial turnaround, the company has reached the
next evolution in the structure of its board of directors and
senior executive team," Mr. Katzenstein continued.  "We have the
utmost confidence in Pete Aquino's executive leadership, and I
look forward to continuing to contribute my perspective in the
coming years as chairman."

The board of directors, through its nominating/corporate
governance committee, is considering possible candidates to assume
the vacant board seat.

                      About RCN Corporation

RCN Corporation (NASDAQ: RCNI) -- http://www.rcn.com/-- is a
provider of bundled cable, high-speed internet and phone services
delivered over its own fiber-optic local network to residential,
small business and commercial customers in the  U.S.  The company
provides service in the Boston, Chicago, Eastern Pennsylvania, New
York, and Washington, D.C. metropolitan markets.  One of its
divisions, RCN Business Services, provides bulk video, high-
capacity data and voice services to small and medium business
customers.  RCN's other commercial division, RCN Business
Solutions, is dedicated to meeting the fiber-based network
requirements of enterprise, wholesale telecom and government
accounts.

                          *     *     *

As reported in the Troubled Company Reporter on Nov 12, 2007,
Moody's Investors Service has taken these ratings action:
on RCN Corp.: (i) corporate family rating -- affirmed B1; (ii)
probability of default rating -- affirmed B2; (iii) $75 million
revolving credit facility due 2013 -- affirmed B1, LGD3 - 33%;
(iv) $520 million senior secured Term Loan B due 2014 -- affirmed
B1, LGD3 - 33%; (v) $200 million new senior secured Term Loan --
assigned B1, LGD3 - 33%; and speculative grade liquidity is
affirmed SGL-2.  The outlook is stable.


SALTON INC: Closes APN Holding Buyout; Harbinger Holds 92% Stake
----------------------------------------------------------------
Salton Inc. has completed its acquisition of APN Holding Company
Inc., the parent of Applica Incorporated, which was accomplished
through a merger of a wholly owned subsidiary of Salton with and
into APN.  Completion of the transaction follows approval by
Salton stockholders of all matters necessary for the acquisition
by Salton of APN.

As a result, Harbinger Capital Partners Master Fund I, Ltd. and
Harbinger Capital Partners Special Situations Fund, L.P., which
were the sole stockholders of APN, became the controlling
stockholders of Salton, owning approximately 92% of the
outstanding shares of Salton's common stock.  Holders of Salton's
Series A Voting Convertible Preferred Stock (excluding Harbinger
Capital Partners), Series C Nonconvertible (Non Voting) Preferred
Stock (excluding Harbinger Capital Partners) and common stock
(excluding Harbinger Capital Partners) outstanding immediately
prior to the merger own approximately 3%, 3% and 2%, respectively,
of the outstanding common stock of Salton immediately following
the merger and related transactions.

In addition to the merger, these transactions occurred in
connection with the closing of the merger:

   (1) the automatic conversion of all outstanding shares of
       Salton's Series A Voting Convertible Preferred Stock,
       including those held by Harbinger Capital Partners, into
       shares of Salton's common stock;

   (2) the automatic conversion of all outstanding shares of
       Salton's Series C Nonconvertible (Non Voting) Preferred
       Stock, including those held by Harbinger Capital Partners,
       into shares of Salton's common stock; and

   (3) the exchange by Harbinger Capital Partners of approximately
       $90 million principal amount of Saltons' second lien notes
       and approximately $15 million principal amount of Salton's
       2008 senior subordinated notes, for shares of a new series
       of non-convertible (non voting) preferred stock of Salton,
       bearing a 16% cumulative preferred dividend.

The combination of Salton and Applica creates one of the largest
U.S. public companies focused on the small household appliance and
pet supply products industries, with the scale and customer
relationships to provide category leadership and efficiencies. The
combined company has a broad portfolio of well recognized brand
names such as Black & Decker(R), George Foreman(R), Russell
Hobbs(R), Toastmaster(R), LitterMaid(R), and Farberware(R).
Salton and its subsidiaries after the merger will continue to
design, service, market and distribute a wide range of products
under these brand names, including small kitchen and home
appliances, pet and pest products, and personal care and wellness
products.

The combination of Salton and Applica is expected to provide
enhanced scale which should enable the combined company to reduce
costs; attract new and expand existing customer relationships;
capitalize on organic and external growth opportunities more
effectively than either company could have on a stand alone basis;
improve cost of goods through larger volume purchasing; and
benefit from improved capital structure flexibility.  In addition,
Salton and Applica have complementary geographic strengths that
can be utilized to enhance the distribution of each company's
products outside the United States.  In particular, Salton's
business is well established in Europe, Australia and Brazil (with
additional distribution in Southeast Asia, Middle East and South
Africa), while Applica's business is well established in Mexico,
South America and Canada.

In connection with the closing of the Merger, each member of
Salton's board of directors resigned effective upon the closing
and Harbinger Capital Partners' designees -- Lawrence M. Clark
Jr., Eugene I. Davis, Jeffrey T. Kirshner, and David M. Maura --
were elected in their place.  The new Salton Board of Directors
then elected Terry L. Polistina to serve as Chief Executive
Officer of Salton and Ivan R. Habibe to serve as Vice President
and Chief Financial Officer of Salton.  Prior to the closing, Mr.
Polistina was Applica's Chief Operating Officer, having held that
title since May 2006, and was also Applica's Chief Financial
Officer, having served in that capacity since January 2001.  Mr.
Habibe was previously Applica's Chief Accounting Officer, having
held that title since May 2006 and prior thereto held senior
finance positions with Applica.

"I have worked closely with Terry Polistina and Ivan Habibe since
January 2007 when Harbinger acquired Applica," David Maura, a
newly elected director of Salton, and a Vice President and
Director of Investments of Harbinger Capital Partners, said.  "In
partnership with Applica's senior management, we have reduced
Applica's debt by over $110 million since December 2006, while
significantly growing Applica's earnings for calendar year 2007
compared to calendar year 2006.  It is our intention to build on
our success with Applica and carry that success over to the
combined Salton-Applica.  We believe the combined company has the
potential to become a preeminent global supplier of small
household appliances and pet supply products bringing new,
exciting and innovative products to retailers and customers around
the globe in 2008 and beyond.  We believe that Terry and his team
are ideally suited to lead the company going forward."

"I am excited about the opportunity to lead a dynamic organization
with a greater breadth of products, a strengthened international
presence and an expanded retailer network," Mr. Polistina
responded.  "The new Salton will remain committed to delivering
quality, innovative products across the Black & Decker(R), George
Foreman(R), Russell Hobbs(R), Litter Maid(R), Toastmaster(R) and
Farberware(R) brands.  In addition, our relationship with
Harbinger will provide an opportunity to seek synergistic
acquisitions to create value for shareholders, while bolstering
the combined company's geographical reach and product offerings."

Houlihan Lokey Howard & Zukin acted as financial advisor and
Sonnenschein Nath & Rosenthal LLP acted as legal advisor to
Salton.  Lazard Freres & Co., LLC acted as financial advisor and
Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal
advisor to Harbinger Capital Partners and APN.

                       About Applica Inc.

Applica Inc. (NYSE: APN) -- http://www.applicainc.com/-- is a
marketer and distributor of a range of branded small household
appliances in five categories: kitchen products, home products,
pest control products, pet care products and personal care
products.

                       About Salton Inc.

Headquartered in Lake Forest, Illinois, Salton Inc. (NYSE:SFP) --
http://www.saltoninc.com/-- designs, markets and distributes
branded, high-quality small appliances, home decor and personal
care products.  Its product mix includes a range of small kitchen
and home appliances, electronics for the home, time products,
lighting products, picture frames and personal care and wellness
products.

                          *     *     *

Moody's Investors Service assigned its Ca rating to Salton Inc.'s
12-1/4% senior subordinated notes due April 15, 2008.


SASCO MORTGAGE: Fitch Takes Rating Actions on Diverse Classes
-------------------------------------------------------------
Fitch Ratings has taken these rating actions on SASCO mortgage
pass-through certificates.  Affirmations total $598 million and
downgrades total $337.8 million.  In addition, $747 million is
placed on Rating Watch Negative.  Break Loss percentages and Loss
Coverage Ratios for each class is included with these rating
actions:

Series 2007-BC3

  -- $184.7 million class 1-A1 affirmed at 'AAA' (BL: 63.46,
     LCR: 4.60);

  -- $35.9 million class 1-A2 affirmed at 'AAA' (BL: 55.47,
     LCR: 4.02);

  -- $76.8 million class 1-A3 affirmed at 'AAA' (BL: 38.79,
     LCR: 2.81);

  -- $29.1 million class 1-A4 affirmed at 'AAA' (BL: 32.13,
     LCR: 2.33);

  -- $152.9 million class 2-A1 affirmed at 'AAA' (BL: 63.62,
     LCR: 4.61);

  -- $30 million class 2-A2 affirmed at 'AAA' (BL: 55.61, LCR:
     4.03);

  -- $64.2 million class 2-A3 affirmed at 'AAA' (BL: 38.87,
     LCR: 2.82);

  -- $24.4 million class 2-A4 affirmed at 'AAA' (BL: 32.13,
     LCR: 2.33);

  -- $21.9 million class 1-M1 downgraded to 'AA-' from 'AA+'
     (BL: 26.92, LCR: 1.95);

  -- $18.3 million class 2-M1 downgraded to 'AA-' from 'AA+'
     (BL: 26.92, LCR: 1.95);

  -- $14.3 million class 1-M2 downgraded to 'A+' from 'AA' (BL:
     23.47, LCR: 1.70);

  -- $12 million class 2-M2 downgraded to 'A+' from 'AA' (BL:
     23.47, LCR: 1.70);

  -- $8 million class 1-M3 downgraded to 'A' from 'AA-' (BL:
     21.50, LCR: 1.56);

  -- $6.7 million class 2-M3 downgraded to 'A' from 'AA-' (BL:
     21.50, LCR: 1.56);

  -- $7.6 million class 1-M4 downgraded to 'A-' from 'A+' (BL:
     19.59, LCR: 1.42);

  -- $6.3 million class 2-M4 downgraded to 'A-' from 'A+' (BL:
     19.59, LCR: 1.42);

  -- $7.3 million class 1-M5 downgraded to 'BBB' from 'A' (BL:
     17.68, LCR: 1.28);

  -- $6.1 million class 2-M5 downgraded to 'BBB' from 'A' (BL:
     17.68, LCR: 1.28);

  -- $6.9 million class M6 downgraded to 'BBB' from 'A-' (BL:
     16.59, LCR: 1.20);

  -- $9.4 million class M7 downgraded to 'BB' from 'BBB+' (BL:
     15.02, LCR: 1.09);

  -- $6.5 million class M8 downgraded to 'BB' from 'BBB' (BL:
     13.85, LCR: 1.00);

  -- $9.4 million class M9 downgraded to 'B' from 'BBB-' (BL:
     12.19, LCR: 0.88);

  -- $11.5 million class B1 downgraded to 'CCC' from 'BB+'; and

  -- $8.6 million class B2 downgraded to 'CCC' from 'BB'.

Deal Summary

  -- Originators: BNC (60.95%), People's Choice (16.60%),
     National City (8.12%) and Fieldstone (6.78%);

  -- 60+ day Delinquency: 7.07%;

  -- Realized Losses to date (% of Original Balance): 0.01%;

  -- Expected Remaining Losses (% of Current Balance): 13.8%;

  -- Cumulative Expected Losses (% of Original Balance): 13%.

Series 2007-OS1

-- $274.6 million class A1 rated 'AAA', placed on Rating Watch
    Negative (BL: 39.83, LCR: 1.78);

  -- $175.4 million class A2 rated 'AAA', placed on Rating
     Watch Negative (BL: 66.51, LCR: 2.97);

  -- $35.5 million class A3 rated 'AAA', placed on Rating Watch
     Negative (BL: 58.46, LCR: 2.61);

  -- $60.1 million class A4 rated 'AAA', placed on Rating Watch
     Negative (BL: 44.36, LCR: 1.98);

  -- $24.4 million class A5 rated 'AAA', placed on Rating Watch
     Negative (BL: 39.67, LCR: 1.77);

  -- $44.8 million class M1 downgraded to 'A' from 'AA+', and
     placed on Rating Watch Negative (BL: 33.97, LCR: 1.52);

  -- $40.2 million class M2 downgraded to 'BBB' from 'AA', and
     placed on Rating Watch Negative (BL: 28.79, LCR: 1.29);

  -- $12.2 million class M3 downgraded to 'BBB' from 'AA-', and
     placed on Rating Watch Negative (BL: 27.18, LCR: 1.21);

  -- $15.2 million class M4 downgraded to 'BBB-' from 'A+', and
     placed on Rating Watch Negative (BL: 25.10, LCR: 1.12);

  -- $13.5 million class M5 downgraded to 'BB' from 'A', and
     placed on Rating Watch Negative (BL: 23.14, LCR: 1.03);

  -- $5.9 million class M6 downgraded to 'BB' from 'A', and
     placed on Rating Watch Negative (BL: 22.23, LCR: 0.99);

  -- $12.2 million class M7 downgraded to 'B' from 'A-', and
     placed on Rating Watch Negative (BL: 20.25, LCR: 0.90);

  -- $8.8 million class M8 downgraded to 'B' from 'BBB+', and
     placed on Rating Watch Negative (BL: 18.74, LCR: 0.84);

  -- $13.1 million class M9 downgraded to 'CCC' from 'BBB' ;

  -- $14.8 million class M10 downgraded to 'CCC' from 'BBB-' ;
     and

  -- $8.4 million class B downgraded to 'CCC' from 'BB+'.

Deal Summary

  -- Originators: (BNC (62.12%) Resmae (18.11%), Lehman Brother
     Bank (through Aurora) (12.88%), and Mortgage Lenders
     Network (6.89%);

  -- 60+ day Delinquency: 14.37%;

  -- Realized Losses to date (% of Original Balance): 0.00%;

  -- Expected Remaining Losses (% of Current Balance): 22.39%;

  -- Cumulative Expected Losses (% of Original Balance):
     20.96%.


SECURITIZED ASSET: Fitch Chips Ratings on Four Certs. to Low-B
--------------------------------------------------------------
Fitch Ratings downgraded these Securitized Asset Backed
Receivables mortgage pass-through certificate.  Downgrades total
$973.9 million.  In addition, $973.9 million is placed on Rating
Watch Negative.  Break Loss percentages and Loss Coverage Ratios
for each class are included with these rating actions:

Series 2007-BR2

  -- $234.5 million class A-1 downgraded to 'AA-' from 'AAA',
     placed on Rating Watch Negative (BL: 39.99, LCR: 1.86);

  -- $516.9 million class A-2 downgraded to 'AA-' from 'AAA',
     placed on Rating Watch Negative (BL: 39.98, LCR: 1.86);

  -- $46 million class M-1 downgraded to 'A+' from 'AA+',
     placed on Rating Watch Negative (BL: 35.60, LCR: 1.65);

  -- $39.4 million class M-2 downgraded to 'A-' from 'AA+',
     placed on Rating Watch Negative (BL: 31.77, LCR: 1.47);

  -- $25.2 million class M-3 downgraded to 'BBB+' from 'AA',
     placed on Rating Watch Negative (BL: 29.26, LCR: 1.36);

  -- $21.3 million class M-4 downgraded to 'BBB' from 'AA-',
     placed on Rating Watch Negative (BL: 27.04, LCR: 1.25);

  -- $20.2 million class M-5 downgraded to 'BBB-' from 'A+',
     placed on Rating Watch Negative (BL: 24.92, LCR: 1.16);

  -- $18 million class M-6 downgraded to 'BB' from 'A', placed
     on Rating Watch Negative (BL: 22.92, LCR: 1.06);

  -- $18.6 million class B-1 downgraded to 'BB' from 'A-',
     placed on Rating Watch Negative (BL: 20.84, LCR: 0.97);

  -- $16.9 million class B-2 downgraded to 'B' from 'BBB+',
     placed on Rating Watch Negative (BL: 19.04, LCR: 0.88);

  -- $16.4 million class B-3 downgraded to 'B' from 'BBB',
     placed on Rating Watch Negative (BL: 17.68, LCR: 0.82).

Deal Summary

  -- Originators: WMC Mortgage Corp. (61.5%), NC Capital
     Corporation (38.5%);

  -- 60+ day Delinquency: 18.05%;

  -- Realized Losses to date (% of Original Balance): 0.23%;

  -- Expected Remaining Losses (% of Current Balance): 21.55%;

  -- Cumulative Expected Losses (% of Original Balance):
     20.53%.


SOLAR INVESTMENT: Fitch Retains 'CC' Ratings on Two Notes
---------------------------------------------------------
Fitch affirms 4 classes of notes issued by Solar Investment Grade
CBO I, Ltd.  These rating actions are the result of Fitch's review
process and are effective immediately:

  -- $205,769,985 Class I-A Notes affirmed at 'AAA';
  -- $15,494,728 Class I-B Notes affirmed at 'AAA';
  -- $25,000,000 Class II-A Notes affirmed at 'A';
  -- $22,000,000 Class II-B Notes affirmed at 'A';
  -- $28,250,000 Class III-A Notes remain at 'CC/DR3';
  -- $10,000,000 Class III-B Notes remain at 'CC/DR3.'

Solar I is a collateralized debt obligation that closed Aug. 31,
2000 and is managed by Sun Capital Advisers, Inc. Solar I has a
portfolio composed primarily of corporate bonds, and is currently
in its amortization period.

Amortizations have caused credit enhancement levels on Class I and
II tranches to increase.  Principal proceeds continue to be
diverted to pay class III interest since last rating actions were
announced in June 23, 2006.  The credit quality of the portfolio
has experienced slight deterioration, with an increase in the
weighted average rating factor since last review in May 2006.

In addition, the class III overcollateralization ratio is
currently failing at 100.93% versus a minimum trigger of 103.2%,
but has increased compared to a level of 99.59% in May 2006
report.  The class III interest coverage ratio has further
deteriorated to 97.40% from 99.80% versus a minimum trigger of
100% during the same time frame.  Further, Solar I does not
contain any defaulted securities since last review in May 2006.

Fitch Ratings conducted cash flow modeling utilizing various
default timing and interest rate scenarios to measure the
breakeven default rates going forward relative to the minimum
cumulative default rates required for the rated liabilities.
Solar I's portfolio is not generating sufficient interest revenue
to cover the interest obligations for the class III liabilities.

The structure of the deal calls for principal proceeds to be
diverted in order to make up for these shortfalls; to date, over
$1.88 million in principal has been diverted for this purpose.
Fitch projects that the deal will continue to divert significant
amounts of principal cash to cover the interest obligations, and
this may impair the ultimate principal recovery prospects for the
class III notes.

The ratings of the class I-A, class I-B, class II-A, class II-B,
class III-A, and class III-B notes address the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the stated balance of
principal by the legal final maturity date.


SUN COAST: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Lead Debtor: Sun Coast Hospital, Inc.
             2025 Indian Rocks Road South
             Largo, FL 33774

Bankruptcy Case No.: 07-12926

Debtor-affiliate filing separate Chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
        Sun Coast Imaging Center, L.L.C.           07-12928

Type of Business: The Debtor provides screening and diagnostic
                  care through treatment, therapy, rehabilitation
                  and home care, among others.  Its 200-bed
                  inpatient facility is staffed with nearly 350
                  physicians.  While its physicians include DOs
                  and MDs in more than 44 specialties and
                  subspecialties, it also provides osteopathic
                  teaching programs.  See
                  http://www.suncoasthospital.net/

Chapter 11 Petition Date: December 28, 2007

Court: Middle District of Florida (Tampa)

Judge: Michael G. Williamson

Debtors' Counsel: Charles A. Postler, Esq.
                  Stichter, Riedel, Blain & Prosser, P.A.
                  110 East Madison Street, Suite 200
                  Tampa, FL 33602-4700
                  Tel: (813) 229-0144

                            Estimated Assets       Estimated Debts
                            ----------------       ---------------
Sun Coast Hospital, Inc.    $1 Million to          $10 Million to
                            $10 Million            $50 Million

Sun Coast Imaging Center,   Less than              Less than
L.L.C.                      $50,000                $50,000

A. Sun Coast Hospital, Inc's 20 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Progress Energy Florida, Inc.  $642,881
P.O. Box 33199
St. Petersburg, FL 33733-8199

University Community Hospital, $472,588
Inc.
Attention: Norm Stein,
President
3100 East Fletcher Avenue
Tampa, FL 33613

Cymetrix Corp.                 $318,477
5 Corporate Park, Suite 280
Irvine, CA 92606

Sodexho, Inc. & Affliates      $283,929
9801 Washington Boulevard
Gaithersburg, MD 20878

Cardinal Health                $212,592

Depuy Orthopaedics, Inc.       $204,375

Guidant/C.P.I.                 $177,355

Morrison Management Specialist $137,113

Lanx, L.L.C.                   $132,357

Humana                         $129,156

Verizon Florida, L.L.C.        $120,840

Cardinal Health/Pyxis Products $109,176

Stryker Medical                $107,865

Florida Blood Services         $104,170

Mayo Collaborative Services    $94,131

Morton Plant Mease             $71,883

Diversified Clinical Services  $70,384

G.E. Medical Systems           $67,974

Advanced Neuromodulation       $67,130
Systems

Advanced Bionics               $58,144


SUN COAST: Inks $19.7 Million Sale Pact With HCA West Florida
-------------------------------------------------------------
Largo Medical Center Inc. aka HCA West Florida, an affiliate of
HCA Inc., and Sun Coast Hospital have signed a sale agreement.

Under the agreement, Largo Medical will acquire Sun Coast Hospital
for $19.7 million less employee benefits, according to David
Simanoff of The Tampa Tribune.

Largo Medical said on its Web site that the closing of the
transaction and transfer of ownership is expected to take place in
the first quarter 2008, following the customary regulatory review
and approval of the U.S. Bankruptcy Court for the Middle District
of Florida.

"Operating independently in the competitive Pinellas County health
care market has been challenging for Sun Coast Hospital," said
Darrell Lentz, CEO, Sun Coast Hospital.  "While we have many
strong programs, we knew that the most responsible resolution for
long-term success was to align the hospital with another
established and secure organization."

The pending transaction will have no effect on scheduled patient
appointments or surgeries, or community health events and classes.

Patients with questions may call Sun Coast at (727) 581-9474.

"Sun Coast Hospital services and physicians complement our
existing network, particularly their highly acclaimed teaching
programs and affiliations," said Daniel Miller, president of HCA
West Florida.  "As we make plans to bring Sun Coast Hospital
resources into the HCA West Florida Family of Hospitals, we will
look closely at how we can provide complementary services in this
expanded network, while continuing to serve the Pinellas County
community.  We intend to employ substantially all of Sun Coast's
current employees."

                      About HCA West Florida

Palm Harbor-based Largo Medical Center Inc. aka HCA West Florida -
- http://www.hcawestflorida.com/-- is a division of HCA Inc. aka
Hospital Corporation of America, -- http://www.hcahealthcare.com/
-- a healthcare provider and runs a network of hospitals,
outpatient surgery and diagnostic imaging facilities.  It offers
specialized health programs and services throughout Central and
West Florida.  The network includes more than 12,000 employees,
4,200 physicians, 15 acute care hospitals, 17 outpatient surgery
centers, 11 diagnostic imaging facilities, nine occupational
health sites, and integrated regional lab, and a consolidated
service center.  The hospitals of HCA West Florida are nationally
recognized for providing exceptional healthcar.  The affiliates of
HCA West Florida and their employees provided both financial and
volunteer support to service clubs, schools, colleges, city
projects and nonprofit and charitable organizations in their
communities.  In 2006, HCA West Florida facilities saw
approximately 480,000 people in their emergency rooms, admitted
149,000 patients, provided $427,337,000 in charity and
uncompensated care and reinvested approximately $133,858,000 in
capital improvements.

                     About Sun Coast Hospital

Largo, Florida-headquartered Sun Coast Hospital --
http://www.suncoasthospital.net/-- was Initially established in
1957 by Dr. Alan J. Snider as an 18-bed acute care hospital.  It
has grown to a 200-bed acute care hospital with a 10,000 square
foot emergency room.  It is one of the largest osteopathic post-
doctoral clinical teaching program in the Southeastern United
States, with 50 postdoctoral physicians serving internships and
residencies.  At present, nearly 350 physicians practice more than
44 medical specialties providing a broad range of services at Sun
Coast, including acute care in-patient rehabilitation, general
surgery, imaging services and behavioral medicine.


TERWIN MORTGAGE: Fitch Junks Rating on Class M-5 Certs. from 'B'
----------------------------------------------------------------
Fitch has taken rating actions on these Terwin Mortgage Trust
asset-backed certificates:

Terwin 2003-6HE

  -- Class A affirmed at 'AAA';
  -- Class M-1 affirmed at 'AA';
  -- Class M-2 affirmed at 'BBB+';
  -- Class M-3 downgraded to 'BB' from 'BBB-';
  -- Class M-4 downgraded to 'B' from 'BB';
  -- Class M-5 downgraded to 'C/DR5' from 'B';

The affirmations affect approximately $26.4 million in outstanding
certificates and reflect adequate relationships of credit
enhancement to future loss expectations.  The downgrades reflect
the deterioration in the relationship of credit enhancement to
future loss expectations and affect $2.9 million in outstanding
certificates.

The mortgage loans for the above transaction consists of fixed and
adjustable-rate mortgage loans secured by first and second liens
on residential properties.  As of the November 2007 distribution
date, delinquencies (loans delinquent more than 60 days, inclusive
of loans in foreclosure, bankruptcy, and real estate owned (REO))
are approximately 21.31%.  The cumulative loss to date is 1.72%.

The transaction is seasoned 48 months with a pool factor (current
mortgage loans outstanding as a percentage of the initial pool) of
15%.


TRANSMETA CORP: Posts $9.1 Million Net Loss in Third Quarter
------------------------------------------------------------
Transmeta Corporation reported a net loss of $9.1 million for the
third quarter ended Sept. 30, 2007, compared with net income of
$2.5 million in the same period last year.  The third quarter of
2007 results included restructuring charges totaling $109,000 and
non-cash charges of $1.7 million for amortization of intangible
assets.

Revenue for the third quarter of 2007 was $44,000, which included
$43,000 of services revenue and $1,000 of license revenue for
royalty payments.  This compared with revenue of $17.3 million in
the same period last year, which included $6.8 million of service
revenue, $10.0 million of license revenue, and $507,000 of product
revenue.

The $10.0 million license revenue revenue recorded in the third
quarter of 2006 represents a LongRun2 license sold to Toshiba.

The 2007 decrease in services revenue was partly attributable to
the lack of any Sony Group revenue for engineering support under
its time-and-materials-based design services contract after
$1.8 million for the first quarter of 2007.

The company's cash, cash equivalents and short term investments at
Sept. 30, 2007, totaled $28.6 million, including the approximate
$7.0 million in net proceeds that Transmeta received from AMD's
investment in the company in July 2007, and the approximate
$11.6 million in net proceeds that the company received from its
securities offering in September 2007.  The company said it
continues to be debt free.

In October, Transmeta entered into an agreement with Intel
Corporation providing for a settlement of all claims between the
two companies and for the licensing of the Transmeta patent
portfolio to Intel for use in current and future Intel products.
The agreement will grant Intel a perpetual non-exclusive license
to all Transmeta patents and patent applications, including any
patent rights later acquired by Transmeta, now existing or as may
be filed during the next ten years.

Under the agreement, Transmeta will grant to Intel a non-exclusive
paid-up license and transfer technology related to its LongRun and
LongRun2 technologies and future improvements.  Under the
agreement, Intel will covenant not to sue Transmeta for the
development and licensing to third parties of Transmeta's LongRun
and LongRun2 technologies.  The agreement provides for Intel to
make an initial $150 million payment to Transmeta as well as to
pay Transmeta an annual license fee of $20 million for each of the
next five years.

"During the third quarter, we reinforced our relationship with AMD
through the strategic investment that AMD made in Transmeta in
July 2007.  In addition, we raised about $11.6 million in net
proceeds from our securities offering in September 2007 and
completed the restructuring program that we started earlier this
year," said Les Crudele, president and chief executive officer.

"In October, we resolved our patent litigation with Intel,
pursuant to an agreement that provides for Transmeta to receive an
initial payment of $150 million and future payments of $20 million
per year for each of the next five years.  We believe these funds
will give us the financial flexibility to execute on our strategy
of developing and licensing our intellectual property.

Having completed our restructuring, resolved our patent
litigation, and taken steps to significantly strengthen our
balance sheet, we can now concentrate our attention on developing
our technology, building our licensing business, putting the
building blocks in place to expand our customer base and creating
long-term shareholder value."

                 Liquidity and Capital Resources

For the three and nine months ended Sept. 30, 2007, and the fiscal
year ended Dec. 31, 2006, the company had negative cash flows from
operations.  Except for the second, third, and fourth quarters of
fiscal 2005, the company has historically reported negative cash
flows from operations, because the gross profit, if any, generated
from operations has not been sufficient to cover the company's
operating cash requirements.

                          Balance Sheet

At Sept. 30, 2007, the company's consolidated balance sheet showed
$36.5 million in total assets, $11.6 million in total liabilities,
and $24.9 million 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?26b0

                       Going Concern Doubt

As reported in the Troubled Company Reporter on April 12, 2007
Burr, Pilger & Mayer LLP expressed substantial doubt about
Transmeta Corporation's ability to continue as a going concern
after auditing the company's financial statements as of the years
ended Dec. 31, 2006, and 2005.  The auditing firm pointed to the
company's recurring losses and negative cash flow from operations.

                      About Transmeta Corp.

Headquartered in Santa Clara, Calif., Transmeta Corporation
(NasdaqGM: TMTA) -- http://www.transmeta.com/-- develops and
licenses innovative computing, microprocessor and semiconductor
technologies and related intellectual property.  Founded in 1995,
the company first became known for designing, developing and
selling its x86-compatible software-based microprocessors.  The
company is presently focused on developing and licensing its
advanced power management technologies for controlling leakage and
increasing power efficiency in semiconductor and computing
devices, and in licensing its computing and microprocessor
technologies to other companies.


UAP HOLDING: Agrium Inc. Withdraws Merger Notification
------------------------------------------------------
Agrium Inc. has withdrawn its notification and report form
submitted to the Antitrust Division of the U.S. Department of
Justice and the Federal Trade Commission under the Hart-Scott-
Rodino Antitrust Improvements Act in connection with the
acquisition of all of the outstanding common stock of UAP Holding
Corp., by a subsidiary of Agrium.

Agrium originally filed its notification and report form under the
HSR Act on Dec. 10, 2007.  By re-filing its notification and
report form with the DOJ and the FTC, Agrium will have a full 15-
day period after the re-filing to discuss the transaction, and
answer any questions raised by the DOJ or the FTC.

As reported in the Troubled Company Reporter on Dec. 5, 2007,
UAP Holding Corp. and Agrium Inc. have entered into a definitive
agreement for Agrium to acquire UAP.  Under the terms of the
agreement, a subsidiary of Agrium will commence a tender offer to
purchase all of the outstanding common stock of UAP for $39 per
share in cash for an aggregate transaction value of approximately
$2.65-billion, including an estimated $487-million of assumed
debt.

The boards of directors of both companies have unanimously
approved the agreement, and the UAP board of directors has
unanimously recommended that the UAP shareholders accept the
tender offer.

The waiting period under the HSR Act will expire at 11:59 pm New
York City time on Jan. 14, 2008, unless this period is earlier
terminated or extended.

                      About Agrium Inc.

Headquartered in Calgary, Alberta, Agrium Inc. (TSX: AGU) (NYSE:
AGU) -- http://www.agrium.com/-- is a retail supplier of
agricultural products and services in both North and South America
and a producer and marketer of agricultural nutrients and
industrial products.  Agrium produces and markets three primary
groups of nutrients: nitrogen, phosphate and potash well as
controlled release fertilizers and micronutrients. Agrium's
strategy is to grow through incremental expansion of its existing
operations and acquisitions as well as the development,
commercialization and marketing of new products and international
opportunities.

                     About UAP Holding Corp.

Headquartered in Greeley, Colorado, UAP Holdings Corp.
(NASDAQ:UAPH) -- http://www.uap.com/-- is the holding company of
United Agri Products Inc., an independent distributor of
agricultural and non-crop products in the United States and
Canada.  United Agri Products Inc. markets products, including
chemicals, fertilizer, and seed to farmers, commercial growers,
and regional dealers.  United Agri Products also provides an array
of value-added services, including crop management, biotechnology
advisory services, custom fertilizer blending, seed treatment,
inventory management, and custom applications of crop inputs.
United Agri Products maintains a network of approximately 370
distribution and storage facilities and three formulation plants,
located in crop-producing areas throughout the United States and
Canada.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 10, 2007,
Standard & Poor's Ratings Services raised its corporate credit
rating UAP Holding Corp. to 'BB-' from 'B+'.  The outlook is
stable.


WHEELING ISLAND GAMING: S&P Withdraws "B" Rating on Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B' corporate
credit and senior unsecured notes ratings on Wheeling, West
Virginia-based Wheeling Island Gaming Inc.  The withdrawal follows
the redemption of the company's outstanding $125 million senior
notes.


WR GRACE: Charleston City Wants Stay Lifted to Seize Property
-------------------------------------------------------------
The city of Charleston, South Carolina, asks the U.S. Bankruptcy
Court for the District of Delaware to lift the automatic stay to
allow it to exercise its power of eminent domain and seize 16.464
acres of real property owned by W.R. Grace & Co. and its debtor-
affiliates located in the City.

The Property, which was once a fertilizer manufacturing and
pesticide formulation facility, will be used by the City as a
relocation site of its public works and fire training facility,
Christina M. Thompson, Esq., at Connolly Bove Lodge & Hutz, LLP,
in Wilmington, Delaware, tells the Court.

The City has passed a resolution that authorized its counsel to
attempt to acquire the Property either by negotiated purchase or
by eminent domain.  However, discussions regarding the sale of
the Property through negotiated purchase have not progressed, Ms.
Thompson tells the Court.

Thus, in the absence of a negotiated agreement with the Debtors
to purchase the Property, the City wants to exercise its powers
of eminent domain against the Property and acquire it for public
use.

Ms. Thompson says relocation of the city's  public works and fire
training facility to the Debtors' Property is part of a series of
economic development plans, which aim to enhance the City
residents' health, safety, and welfare.

The Property is estimated to be worth $1,185,000 in December
2005, Ms. Thompson says.

Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.

The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, Esq., at Kirkland & Ellis, LLP, and Laura Davis
Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the
Debtors in their restructuring efforts.  The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.

Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors.  The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice.  David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence,
Pennsylvania.  Elihu Inselbuch, Esq., at Caplin & Drysdale,
Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC,
represent the Official Committee of Asbestos Personal Injury
Claimants.  The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it.  Lexecon,
LLC, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.

The Debtors' filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004.  On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement.  The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005.  The
Debtors' exclusive period to file a chapter 11 plan expired on
July 23, 2007.

Estimation of W.R. Grace's asbestos personal injury liabilities
will commence on Jan. 14, 2008.  (W.R. Grace Bankruptcy News,
Issue No. 146; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


WR GRACE: Wants to Settle Environmental Claims for $44 Million
--------------------------------------------------------------
W.R. Grace & Co., together with its debtor-affiliates, and the
United States Government, on behalf of certain federal agencies
including the Environmental Protection Agency and the Department
of Agriculture Forest Services, have agreed to a settlement to
avoid protracted claims litigation and resolve their liabilities
in connection with environmentally damage sites owned by the
Debtors.  The Debtors agree that the Government is entitled to a
$2,294,279 allowed administrative claim and a $34,065,813 allowed
general unsecured claim.  The Debtors agree that the PRPs are
entitled to allowed general unsecured claims aggregating
$7,707,336.

The Government, had filed Claim Nos. 9634 and 9635 against the
Debtors seeking recovery of past and future environmental response
costs incurred by the federal agencies in the course of responding
to releases of hazardous substances in 32 Debtor-owned and
operated sites around the United States.  The Government also
sought recovery for natural resource damages.

In addition, certain potentially responsible parties had filed
claims against the Debtors for environmental response
contribution claims.

The allowed general unsecured claims are:

                                            Allowed General
   Claimant                                 Unsecured Claim
   --------                                 ---------------
   U.S. Government                              $34,065,813
   Burlington Northern and Santa Fe Railway       2,952,761
   American Premier Underwriters, Inc.            1,763,492
   National Railroad Passenger Corporation        1,528,550
   Los Angeles County Metropolitan Authority        893,781
   Green River Site PRP Group Claimants             419,452
   Harrington Tools, Inc.                           112,547
   Central Chemical Site Participation Group         36,750

In addition, the Government will have a $622,860 allowed general
unsecured claim in settlement for the costs incurred by the
Agency for Toxic Substances and Disease Registry in investigating
the asbestos contamination at the Debtors' facilities that
processed vermiculite.  The BNSF will also a $1,918,355 allowed
general unsecured claim in settlement of its claim relating to
the Debtors' Libby, Montana, vermiculite mine.

The settlement provides that the Debtors will pay $672,574 of the
Administrative Claims immediately after the Court's approval of
the settlement.  The remaining Allowed Administrative Claims and
all of the Allowed General Unsecured Claims will be paid pursuant
to a confirmed plan of reorganization.  Allowed General Unsecured
Claims will be entitled to interest only if permitted under a
confirmed reorganization plan.

The settlement also provides that the settling federal agencies
will not file a civil action or take any administrative action
against the Debtors pursuant to the Comprehensive Environmental
Response, Compensation, and Liability Act with respect to each of
the sites covered by the settlement agreement.

The Sites covered by the settlement are:

    * Acton Plant Site, Massachusetts,
    * Amber Oil (Eco-Tech) Site, Wisconsin,
    * Aqua Tech Site, South Carolina,
    * Cambridge Plant Site, Massachusetts,
    * Casmalia Resources Site, California,
    * Central Chemical Site, Maryland,
    * Galaxy/Spectron Site, Maryland,
    * Green River Site, Kentucky,
    * Harrington Tools Site, California,
    * Intermountain Insulation Site, Utah,
    * IWI Site, Illinois,
    * Li Tungsten Site, New York,
    * Malone Services Co. Site, Texas,
    * N-Forcer Site, Michigan,
    * Operating Industries Site, California,
    * R&H Oil/Tropicana Site, Texas,
    * RAMP Industries Site, Colorado,
    * Reclamation Oil Site, Michigan,
    * Robinson Insulation Site, North Dakota,
    * Solvents Recovery Service Site, Connecticut,
    * Salt Lake Vermiculite Intermountain Site, Utah,
    * Spokane Vermiculite Northwest Site, Washington,
    * Wauconda Sand and Gravel Superfund Site, Illinois,
    * Watson Johnson Landfill Site, Pennsylvania,
    * Wells G&H Site, Massachusetts,
    * Western Minerals Processing Site, Colorado,
    * Western Minerals Products Site, Minnesota,
    * Ellwood Zonolite Site, Pennsylvania,
    * New Castle Zonolite Site, Pennsylvania,
    * Hamilton Zonolite Site, New Jersey,
    * Prince George Zonolite Site, Maryland, and
    * Wilder Zonolite Site, Kentucky.

A full-text copy of the Settlement is available for free at:

      http://bankrupt.com/misc/grace_EPASettlement.pdf

The Debtors' counsel, David M. Bernick, P.C., Esq. at Kirkland &
Ellis, LLP, in Chicago, Illinois, says the Government's claim
relating to the Debtors' site in Curtis Bay, Baltimore, Maryland,
will be resolved in accordance with a separate settlement
agreement still to be filed with the Court.

                     Government's Statement

"This settlement will make money available to substantially help
the cleanup of many Superfund sites around the country," Ronald
J. Tenpas, Assistant Attorney General for the DOJ's Environment
and Natural Resources Division, said in a public statement.
"This settlement is a good outcome for both the taxpayers and the
environment."

"Bankruptcy is not a safe haven to avoid environmental
responsibilities," Catherine McCabe, principal deputy assistant
administrator for EPA's Office of Enforcement and Compliance
Assurance, further said in a press release.  "EPA will keep
pursuing companies who pollute the environment."

The Government said it will use the settlement to reimburse EPA
for past costs and to pay for future costs associated with
cleaning up at hazardous waste sites in 18 states.  Superfund is
the federal program that investigates and cleans up the most
complex uncontrolled or abandoned hazardous waste sites in the
country.

The settlement agreement will be subject to court approval after
a 30-day public comment period.

                        About W.R. Grace

Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.

The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, Esq., at Kirkland & Ellis, LLP, and Laura Davis
Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the
Debtors in their restructuring efforts.  The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.

Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors.  The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice.  David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence,
Pennsylvania.  Elihu Inselbuch, Esq., at Caplin & Drysdale,
Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC,
represent the Official Committee of Asbestos Personal Injury
Claimants.  The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it.  Lexecon,
LLC, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.

The Debtors' filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004.  On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement.  The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005.  The
Debtors' exclusive period to file a chapter 11 plan expired on
July 23, 2007.

Estimation of W.R. Grace's asbestos personal injury liabilities
will commence on Jan. 14, 2008.  (W.R. Grace Bankruptcy News,
Issue No. 146; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


YRC WORLDWIDE: Earns $40.7 Million in Third Quarter
---------------------------------------------------
YRC Worldwide Inc. reported net income of $40.7 million on
operating revenue of $2.46 billion for the third quarter ended
Sept. 30, 2007, compared with net income of $95.8 million on
operating revenue of $2.57 million in the correponding period a
year ago.

Consolidated operating revenue decreased versus 2006 primarily due
to continued weak economic conditions in the United States
transportation industries and the resulting intense competitive
pricing environment.

Consolidated operating income decreased significantly to
$87.7 million as compared to $177.6 million in 2006 and is
reflective of decreased operating revenue and weak yield growth at
all of the company's operating companies.  Despite a relatively
consistent decline in revenue between the company's national and
regional providers, the Regional Transportation segment
experienced a much greater decline in operating income as the weak
economy in the Upper Midwest impacted this segment more severely.

Additionally, the company was less effective in reducing its
variable costs in the regional market in response to the decline
in revenue than in the national market.  This is partly
attributable to continued challenges associated with the USF
Reddaway and USF Bestway February 2007 consolidation.

Corporate net operating expenses during the three months ended
Sept. 30, 2007, increased $5.7 million versus the comparable prior
year period primarily related to increased incentive compensation
expense of $5.0 million and $1.2 million of unallocated corporate
expenses offset by reduced legal and other expense of aproximately
$500,000 million.

Consolidated operating income for the three months ended Sept. 30,
2007, includes restructuring charges of $1.3 million related to
lease termination costs resulting from continued consolidation of
USF Reddaway and USF Bestway terminals primarily in the California
market and a $1.5 million gain on settlement of certain USF Red
Star multi-employer pension withdrawal obligations.  During the
three months ended Sept. 30, 2006, the company incurred a
$2.8 million loss on sale of the YRC Logistics China (excluding
Hong Kong) freight forwarding operations and $2.3 million of
reorganization charges related to the relocation of a portion of
Logistics' operations from Greenwood, Indiana to Overland Park,
Kansas.  During the three months ended Sept. 30, 2007, and 2006,
the company recognized losses on disposals of $1.4 million and
$2.4 million, respectively.

Interest expense decreased $310,000 to $22.7 million due to
decreased borrowings for the three months ended Sept. 30, 2007,
versus 2006.

The company's effective tax rate for the three months ended
Sept. 30, 2007, was 36.3% compared to 38.3% for the three months
ended Sept. 30, 2006.  The 2007 rate reflects an estimated annual
benefit of $7.4 million for a propane fuel tax credit in 2007.

                       Nine Months Results

Consolidated operating revenue decreased by $238.4 million during
the nine months ended Sept. 30, 2007, as compared to the year ago
period.

Consolidated operating income decreased by $221.2 million or 50.5%
during the nine months ended Sept. 30, 2007, as compared to the
year ago period.  The decrease in consolidated operating income
was a result of reduced operating revenue, weak yield growth and
challenging economic conditions.

Net income of $97.4 million in the nine months ended Sept. 30,
2007, compared with net income of $230.2 million in the comparable
period last year.

                           Liquidity

The company maintains capacity under a $1.1 billion unsecured
credit agreement, which includes a fully drawn $150.0 million term
loan, and a $700.0 million asset-backed securitization facility
involving the accounts receivable of Yellow Transportation,
Roadway, USF Holland and USF Reddaway.

Available unused capacity as of Sept. 30, 2007, was
$668.0 million.

                          Balance Sheet

At Sept. 30, 2007, the company's consolidated balance sheet showed
$6.20 billion in total assets, $3.91 billion in total liabilities,
and $2.29 billion in total shareholders' 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?26b3

                     About YRC Worldwide

YRC Worldwide Inc. -- http://www.yrcw.com/-- (NASDAQ: YRCW)
provides transportation service and is the holding company for a
portfolio of brands including Yellow Transportation, Roadway,
Reimer Express, YRC Logistics, New Penn, USF Holland, USF
Reddaway, and USF Glen Moore.  The enterprise provides global
transportation services, transportation management solutions and
logistics management.  The portfolio of brands represents a
comprehensive array of services for the shipment of industrial,
commercial and retail goods domestically and internationally.
Headquartered in Overland Park, Kansas, YRC Worldwide employs
approximately 60,000 people.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 17, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
ratings on YRC Worldwide Inc. to 'BB+' from 'BBB-'.  S&P removed
the ratings from CreditWatch, where they were placed with negative
implications on Oct. 29, 2007.  The outlook is negative.


YRC WORLDWIDE: Expects 4th Qtr. Impairment Chgs. of $700-$800 Mil.
------------------------------------------------------------------
YRC Worldwide Inc. disclosed Wednesday that it expects to incur
non-cash impairment charges during the fourth quarter of 2007
relating to prior acquisitions in the pre-tax range of $700 to
$800 million, or $650 to $750 million after taxes.

The company has nearly completed its annual impairment review of
goodwill and certain other intangible assets arising from
acquisitions.  Given applicable accounting standards, which
strongly consider current market conditions, these impairment
charges will primarily relate to a decline in the estimated point-
in-time fair value of the acquired former USF Corporation
companies.  These companies generally now comprise the company's
YRC Regional Transportation business unit.  The remainder of the
anticipated charges is due to a reduction in the calculated fair
values of USF and Roadway trade names.

The company does not expect the impairment charges to have any
impact on the company's cash flow or availability of financing
under existing debt facilities.  "While we are clearly
disappointed with this development, it does not change our belief
in the future outlook for any of our companies, particularly YRC
Regional Transportation," stated Bill Zollars, chairman, president
and chief executive officer of YRC Worldwide.

The company said that its new YRC Regional Transportation
management team is making progress in implementing operational
changes designed to improve financial performance as part of its
previously disclosed $100 million performance improvement
initiative.  In addition, actions have already taken place to
reduce corporate overhead, close redundant offices and eliminate
unnecessary activities.

"Cost reduction actions and operational improvements across the
company set the stage for improved performance in 2008," stated
Zollars.  "We continue to move forward on key strategic
initiatives, including the recent announcement of a tentative
five-year agreement with the International Brotherhood of
Teamsters and a definitive purchase agreement for our China ground
transportation acquisition."

                       About YRC Worldwide

YRC Worldwide Inc. -- http://www.yrcw.com/-- (NASDAQ: YRCW)
provides transportation service and is the holding company for a
portfolio of brands including Yellow Transportation, Roadway,
Reimer Express, YRC Logistics, New Penn, USF Holland, USF
Reddaway, and USF Glen Moore.  The enterprise provides global
transportation services, transportation management solutions and
logistics management.  The portfolio of brands represents a
comprehensive array of services for the shipment of industrial,
commercial and retail goods domestically and internationally.
Headquartered in Overland Park, Kansas, YRC Worldwide employs
approximately 60,000 people.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 17, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
ratings on YRC Worldwide Inc. to 'BB+' from 'BBB-'.  S&P removed
the ratings from CreditWatch, where they were placed with negative
implications on Oct. 29, 2007.  The outlook is negative.


* Survey Says CMI Finishes 2007 With Another Slight Drop
--------------------------------------------------------
The seasonally adjusted Credit Manager's Index fell for the fourth
consecutive month in December.  The index lost 0.7%, and dropped
to a record low of 52.4%. Six of the 10 components fell, including
a 4% drop in dollar collections.

Daniel North, chief economist with credit insurer Euler Hermes
ACI, said, "While the manufacturing index actually gained 0.8%,
it was overshadowed by a loss of 2.3% in the service index.  The
deterioration in the combined index matches that of other major
indicators in the macroeconomy, including disappointing holiday
sales, a weakening employment market, accelerating declines in
housing prices, downgrades of banks and insurers, plummeting
consumer confidence, and a rapid increase in delinquencies and
defaults on many types of credit.  It would appear that trade
credit managers are now encountering the same difficulty found in
other credit markets, that is, the inability of debtors to pay
bills due to insufficient cash flow."

For the first time in four months, the manufacturing sector
actually gained ground, rising 0.8% to 53.5%.  "Most of the
increase came from significant improvements in disputes and the
dollar amount of customer deductions," North said.  "The data
suggest that at least for the month of December, manufacturers'
customers are being less aggressive about holding on to their
cash," he concluded.

The service sector index fell 2.3% in December on a seasonally
adjusted basis, led by sharp downturns in sales and dollar
collections.  It was the seventh decline in sales in the past
eight months.  North said, "The data suggest that businesses are
experiencing an unpleasant combination of slower cash flow and
expectations of slower consumer demand. Once again, the housing
market continues to wreak havoc in the service sector."

North noted that of the survey responses, one participant
described a "Residential housing crisis ... and ... continuing
problem of buyer walk-offs."  Another reported that "Past dues are
higher and customers that were robbing Peter to pay Paul are
feeling the unavailability of cash."  Finally, there was the
almost plaintive comment from a construction material supplier
that "It's been a tough year."

The combined Credit Manager's Index fell 2.4% over the past 12
months as eight of the 10 components fell.  "The filings for
bankruptcies component fared the worst, falling 7.4%," North said.
The service sector fell 1.6%, also led by the bankruptcy component
which declined 8.8%.  In the manufacturing sector, eight of the 10
components fell resulting in an overall drop in the index of 3.1%.

"Along with a drop in bankruptcies, declines of 7.6% in sales and
7.5% in accounts placed for collections weighed the index down,"
he said.  "The data suggest that indeed more business than usual
are having a tough time surviving in this environment as sales and
cash flow dry up."

                          What is CMI?

The CMI, a monthly survey of the business economy from the
standpoint of commercial credit and collections, was launched in
January 2003 to provide financial analysts with another strong
economic indicator.

The CMI survey asks credit managers to rate favorable and
unfavorable factors in their monthly business cycle. Favorable
factors include sales, new credit applications, dollar collections
and amount of credit extended. Unfavorable factors include
rejections of credit applications, accounts placed for
collections, dollar amounts of receivables beyond terms and
filings for bankruptcies.

A complete index including results from the manufacturing and
service sectors, along with the methodology is available for free
at: http://ResearchArchives.com/t/s?25fa

                           About NACM

Headquartered in Columbia, Maryland, The National Association of
Credit Management (NACM) -- http://www.nacm.org-- supports more
than 22,000 business credit and financial professionals worldwide
with premier industry services, tools and information.  NACM and
its network of Affiliated Associations are the resource for credit
and financial management information and education, delivering
products and services which improve the management of business
credit and accounts receivable.


* Trade Credit Index Falls to Record Low Level Says Eueler Hermes
-----------------------------------------------------------------
A major credit index dropped to its lowest point in its more
than five year history, as growth in the nation's manufacturing
sector was trumped by a sharp contraction in the service sector.
According to analysis from leading trade credit insurer Euler
Hermes ACI, the trade credit markets are now facing the same
problems as the rest of the country's credit markets as more
companies find it difficult to pay their bills due to insufficient
cash flow.

In his monthly commentary regarding a national survey of credit
managers in the manufacturing and service sectors, Euler Hermes
ACI Chief Economist Daniel C. North said the survey data showed a
decline for the fourth consecutive month in December and dropped
to a record low.  Six of the 10 survey components fell, including
a 4% drop in dollar collections.  "While the manufacturing index
actually gained slightly, it was overshadowed by a sharp loss in
the service index," he explained.  "The deterioration in the
combined index matches that of other major indicators in the
macroeconomy, including disappointing holiday sales, a weakening
employment market, accelerating declines in housing prices,
downgrades of banks and insurers, plummeting consumer confidence,
and a rapid increase in delinquencies and defaults on many types
of credit."

For the first time in four months, the manufacturing sector
actually gained ground, rising 0.8%.  Most of the increase came
from significant improvements in disputes and the dollar amount of
customer deductions. North said the data suggests that "at least
for the month of December, manufacturers' customers are being less
aggressive about holding on to their cash."

Meanwhile, the service sector index fell 2.3% in December on a
seasonally adjusted basis, led by sharp downturns in sales and
dollar collections.  It was the seventh decline in sales in the
past eight months.  North said the data suggests that businesses
are experiencing an unpleasant combination of slower cash flow,
and expectations of slower consumer demand.  "Once again the
housing market continues to wreak havoc in the service sector," he
explained.  "One survey participant described a 'residential
housing crisis' and 'a continuing problem of buyer walk-offs.' And
another reported that 'past dues are higher and customers that
were robbing Peter to pay Paul are feeling the unavailability of
cash.'  And finally, there was the almost plaintive comment from a
construction material supplier that 'it's been a tough year.'"

North said survey respondents confirmed that business bankruptcies
across the country are continuing to rise, and that increase --
coupled with declining sales and increased dollar amounts placed
for collection -- show that the nation's business conditions are
indeed worsening. "It would appear that trade credit managers
are now encountering the same difficulty found in other credit
markets -- the inability of debtors to pay their bills due to
insufficient cash flow. The survey data suggests that indeed more
business than usual are having a tough time surviving in this
environment as sales and cash flow dry up," he concluded.

                      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.


* 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 Art Xpectations, L.L.C.
   Bankr. N.D. Tex. Case No. 07-36285
      Chapter 11 Petition filed December 21, 2007
         See http://bankrupt.com/misc/txnb07-36285.pdf

In Re Sandy Bottom Properties, L.L.C.
   Bankr. D. R.I. Case No. 07-12699
      Chapter 11 Petition filed December 24, 2007
         See http://bankrupt.com/misc/rib07-12699.pdf

In Re Meridian Hills, L.L.C.
   Bankr. D. Ariz. Case No. 07-07097
      Chapter 11 Petition filed December 26, 2007
         See http://bankrupt.com/misc/azb07-07097.pdf

In Re 21st Century Investments, L.L.C.
   Bankr. C.D. Calif. Case No. 07-14469
      Chapter 11 Petition filed December 26, 2007
         See http://bankrupt.com/misc/cacb07-14469.pdf

In Re Church of God Valley of Blessing of Central Florida, Inc.
   Bankr. M.D. Fla. Case No. 07-06756
      Chapter 11 Petition filed December 26, 2007
         See http://bankrupt.com/misc/flmb07-06756.pdf

In Re Jean Brown Dorothy
   Bankr. E.D. Calif. Case No. 07-31285
      Chapter 11 Petition filed December 26, 2007
         Filed as Pro Se

In Re Kimberly Ann Brockington
   Bankr. N.D. Calif. Case No. 07-54355
      Chapter 11 Petition filed December 26, 2007
         Filed as Pro Se

In Re Angela M. Moses
   Bankr. C.D. Calif. Case No. 07-22124
      Chapter 11 Petition filed December 26, 2007
         Filed as Pro Se

In Re Robert Woolson Todd, Jr.
   Bankr. C.D. Calif. Case No. 07-12032
      Chapter 11 Petition filed December 26, 2007
         Filed as Pro Se

In Re Montie Odell Robinson
   Bankr. W.D. Tenn. Case No. 07-14190
      Chapter 11 Petition filed December 26, 2007
         See http://bankrupt.com/misc/tnwb07-14190.pdf

In Re Atlanta Marketing Solutions
   Bankr. N.D. Ga. Case No. 07-81720
      Chapter 11 Petition filed December 27, 2007
         See http://bankrupt.com/misc/ganb07-81720.pdf

In Re 3719 Cleveland Avenue, L.L.C.
   Bankr. S.D. Ohio Case No. 07-60410
      Chapter 11 Petition filed December 27, 2007
         See http://bankrupt.com/misc/ohsb07-60410.pdf

In Re Gregory Britton Bostick
   Bankr. S.D. Calif. Case No. 07-07523
      Chapter 11 Petition filed December 27, 2007
         Filed as Pro Se

In Re George Holland, Jr.
   Bankr. N.D. Calif. Case No. 07-44503
      Chapter 11 Petition filed December 27, 2007
         Filed as Pro Se

In Re Jerusalem Charitable Trust
   Bankr. E.D. Tex. Case No. 07-61067
      Chapter 11 Petition filed December 27, 2007
         Filed as Pro Se

In Re Village Green, Inc.
   Bankr. C.D. Calif. Case No. 07-22174
      Chapter 11 Petition filed December 27, 2007
         Filed as Pro Se

In Re Diana Kay Lurey
   Bankr. W.D. Va. Case No. 07-50953
      Chapter 11 Petition filed December 27, 2007
         Filed as Pro Se

In Re Joseph F. Heath
   Bankr. E.D. Va. Case No. 07-14107
      Chapter 11 Petition filed December 27, 2007
         See http://bankrupt.com/misc/vaeb07-14107.pdf

In Re Figueiredos Importing & Exporting, L.L.C.
   Bankr. D. Conn. Case No. 07-50791
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/ctb07-50791.pdf

In Re S.G.A. Architecture, Inc.
   Bankr. S.D. Fla. Case No. 07-21623
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/flsb07-21623.pdf

In Re Advanced Process Technologies, L.L.C.
   Bankr. N.D. Ind. Case No. 07-13647
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/innb07-13647.pdf

In Re Fortune Empire (J. D. Levy), Inc.
   Bankr. E.D. N.Y. Case No. 07-47134
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/nyeb07-47134.pdf

In Re Fernando A. Vazquez Lago
   Bankr. D. P.R. Case No. 07-07643
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/prb07-07643.pdf

In Re Lectrics Electrical Contractors, Inc.
   Bankr. S.D. Tex. Case No. 07-20678
      Chapter 11 Petition filed December 28, 2007
         Filed as Pro Se

In Re Alazan Waco Corp.
   Bankr. N.D. Tex. Case No. 07-36329
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/txnb07-36329.pdf

In Re L.R.I. IV, Ltd.
   Bankr. N.D. Tex. Case No. 07-36358
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/txnb07-36358.pdf

In Re Douglas J. Borgman
   Bankr. W.D. Tex. Case No. 07-12415
      Chapter 11 Petition filed December 28, 2007
         See http://bankrupt.com/misc/txwb07-12415.pdf

In Re A.F.G. Partners, L.L.C.
   Bankr. S.D. N.Y. Case No. 07-14108
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/nysb07-14108.pdf

In Re Helen E. Carithers
   Bankr. E.D. Penn. Case No. 07-17587
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/paeb07-17587.pdf

In Re Albert S. Farkas
   Bankr. W.D. Penn. Case No. 07-28199
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/pawb07-28199.pdf

In Re The Johnickie Group
   Bankr. N.D. Ga. Case No. 07-81927
      Chapter 11 Petition filed December 31, 2007
         Filed as Pro Se

In Re Gods Fountain of Love, Inc.
   Bankr. N.D. Ga. Case No. 07-81909
      Chapter 11 Petition filed December 31, 2007
         Filed as Pro Se

In Re L.&R. Properties, L.L.C.
   Bankr. M.D. Ga. Case No. 07-71407
      Chapter 11 Petition filed December 31, 2007
         Filed as Pro Se

In Re Performance Steel, Inc.
   Bankr. N.D. Tex. Case No. 07-36418
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/txnb07-36418.pdf

In Re Sultan Abdullah
   Bankr. S.D. Tex. Case No. 07-38889
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/txsb07-38889.pdf

In Re M.&D. Project Management, Inc.
   Bankr. D. Wyo. Case No. 07-20771
      Chapter 11 Petition filed December 31, 2007
         See http://bankrupt.com/misc/wyb07-20771.pdf

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
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S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
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