/raid1/www/Hosts/bankrupt/TCR_Public/080118.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, January 18, 2008, Vol. 12, No. 15
Headlines
3700 ASSOCIATES: Receives Notice of Default from Deutsche Bank
ACE SECURITIES: S&P Cuts 53 Classes' Ratings on Monthly Losses
AEGIS ASSET: Moody's Cuts Ratings on Six Classes from Two Deals
AMERICA'S FIRST: Asks Seminole Court's Okay to Liquidate Assets
AMERICAN HOME: Moody's Cuts 16 Tranches' Ratings on Delinquency
AMR CORP: Posts $69 Million Net Loss in 2007 Fourth Quarter
ASARCO LLC: Wants to Hire Halpering Battaglia as Consulting Expert
ASARCO LLC: Wants to Sell Perth Amboy Property for $19.8 Million
ASPEN EXECUTIVE: Wants to Extend Plan-Filing Deadline to May 12
ATLANTIS PLASTICS: Weak Liquidity Spurs Moody's to Junk Rating
BON-TON STORES: S&P Revises Outlook to Negative & Holds Ratings
BROTMAN MEDICAL: Alvarez & Marsal Approved as Panel's Advisor
BTC: Increased Credit Enhancement Cues Fitch to Lift Ratings
CABLEVISION CORP: S&P Maintains BB Corporate Credit Rating
CAPCO AMERICA: Fitch Holds 'B-' Rating on $24.9MM Cl. B-4 Certs.
CENTRO NP: Moody's Slashes Senior Debt Rating to B3 From B1
CENTRO PROPERTIES: Bracewell & Giuliani Represents Noteholders
CHARTERHOUSE BOISE: Developer Given Chance to Avoid Foreclosure
CHESAPEAKE CORP: Amends Fourth Quarter 2007 Credit Covenants
CHESAPEAKE CORP: Moody's Puts Ratings on Review & May Downgrade
CHICAGO H&S: February 4 Deadline Set for Proofs of Claim Filing
CLASS V FUNDING: Poor Credit Quality Cues Moody's Rating Cuts
COMSTOCK HOME: Has Until July 7 to Comply with Nasdaq Rules
CONSECO/GREEN TREE: Fitch Affirms Ratings on 54 Classes
COOKSON SPC: S&P Junks Rating on 2007-1LAC Notes
CREDIT SUISSE: Moody's Affirms Junk Ratings on Two Classes
CWALT INC: Moody's Lowers Ratings on Nine Tranches to Low-B
CWALT INC: Moody's Reviews 10 Tranches' Ratings for Likely Cuts
CYGNAL TECHNOLOGIES: Amends Terms of Nov. 2007 DIP Facility Pact
CYGNAL TECHNOLOGIES: Wants Further Extension of Stay Under CCAA
DELPHI CORP: Gets $44.2 Mil. Bearing Biz Bid from ND Acquisition
DELTA AIR: Commences Merger Negotiations with Northwest and UAL
EDGEWATER FOODS: Posts $913,315 Net Loss in 1st Qtr. Ended Nov. 30
FBR SECURITIZATION: Losses Cues S&P's Rating Cuts on 20 Classes
FREMONT INVESTMENT: S&P Confirms Mortgage Servicer Ranking
FIRST RC: Voluntary Chapter 11 Case Summary
GENERAL MOTORS: Outlines Turnaround Progress and 2008 Priorities
GENESIS PHARMACEUTICALS: Sherb & Co. Raises Going Concern Doubt
GLOBAL CREDIT: S&P Places BB- Rating Under Negative Watch
GRAFTECH INTL: S&P Ratings Unmoved by $125MM Notes' Redemption
GREENPOINT MORTGAGE: Moody's Downgrades Ratings on 11 Tranches
GREENWICH CAPITAL: Stable Performance Cues Fitch to Hold Ratings
GSC INVESTMENT: S&P Puts Preliminary BB Rating on $22MM Notes
HANOVER INSURANCE: Moody's Reviews Ba1 Rating for Possible Cut
HARBORVIEW MORTGAGE: Moody's Downgrades Ratings on 18 Tranches
HAVEN HEALTHCARE: Committee Hires Pepper Hamilton as Counsel
HEARTLAND AUTO: Gets Initial OK to Use Lenders' Cash Collateral
HOVNANIAN ENT: S&P Cuts Preferred Stock's Rating to D from CCC+
IKONA GEAR: Nov. 30 Balance Sheet Upside-Down by $51,380
INDUSTRIAL DEV'T: Fitch Cuts Rating on Series 1997A Bonds to B+
ING RE (UK): Chap. 15 Petition Hearing Set for January 30
INPHONIC INC: Wants Court to Set February 28 as Claims Bar Date
IWT TESORO: Withdraws Exclusive Periods Extension Plea
JOHN CHEZIK: Punitive Damages Double Initial Verdict of $8.4 Mil.
JOHNSON RUBBER: Court Approves Benesch Friendlander as Counsel
JOHNSON RUBBER: Development Specialists OK'd as Financial Advisor
JOHNSON RUBBER: Court Defers DIP Facility Final Hearing to Jan. 29
JP MORGAN: Moody's Holds Low-B Ratings on Six Certificates
KATONAH 2007-I: S&P Puts Preliminary BB Rating on $10.5MM Notes
KELLWOOD CO: Sun Capital Offer Prompts Moody's to Revise Outlook
LAKE AT LAS VEGAS: S&P Cuts Then Withdraws Ratings
LANDMARK FBO: Moody's Junks Rating on $120 Million 2nd Lien Loan
LAS VEGAS SANDS: Completes Initial Funding of Credit Facility
LB COMMERCIAL: Moody's Maintains Junk Ratings on Two Classes
LEHMAN XS: Moody's Cuts Ratings on Five Tranches on Delinquency
LEOPOLDO TREVINO: Case Summary & Three Largest Unsecured Creditors
LEVITZ FURNITURE: Can Use GECC's Cash Collateral on Final Basis
LEVITZ FURNITURE: Can Hire Rodman & Renshaw as Financial Advisor
LIBERTY MEDIA: Discloses Semi-Annual Payment to Debenture Holders
LUMINENT MORTGAGE: Receives NYSE Non-Compliance Notice
LUMINENT MORTGAGE: Moody's Downgrades Ratings on Six Tranches
MAXJET AIRWAYS: Committee Wants to Hire Morris James as Co-Counsel
MGM MIRAGE: Raises Tender Offer to 15 Million Shares
MGM MIRAGE: Launches Sale of CityCenter's Harmon Hotel
MONEYGRAM INTL: $860 Mil. Losses Cues S&P to Cut Rating to BB
MORGAN STANLEY: Fitch Affirms 'BB+' Rating on $14MM Certs.
MORGAN STANLEY: S&P Keeps B+ Rating on $3 Mil. Class A-3 Notes
MTI TECHNOLOGY: Thomas Raimondi Resigns as Chairman of the Board
NATIONAL FARM: Files Schedules of Assets and Liabilities
NATIONAL FARM: Files List of Two Largest Unsecured Creditors
NEPTUNE CDO: Weak Credit Quality Cues Moody's to Lower Ratings
NEW CENTURY: Court Amends XRoads Appointment Order
NEW CENTURY: Jamie Lisac Appointed as New CFO
NEW CENTURY: Wants Bid Procedures for Sale of Mortgage Loans OK'd
NEWPAGE CORP: Closes Plants & Cuts Jobs as Restructuring Continues
OCWEN FINANCIAL: Gets $7/Share in Cash Proposal from Investors
OCWEN FINANCIAL: Investor Proposal Cues Fitch's Evolving Watch
OPEN MAGNETIC: Case Summary & 425 Largest Unsecured Creditors
ORIGEN FINANCIAL: Fitch Retains Junk Ratings on Two Classes
OWNIT MORTGAGE: Two Trust Classes Acquire S&P's Junk Ratings
PAETEC HOLDING: S&P Holds B Corporate Credit Rating
PIERRE FOODS: Posts $7.5 Mil. Net Loss in Qtr. Ended December 1
PORTOLA PACKAGING: S&P Junks Corporate Credit Rating
PRESIDENT CASINOS: Earns $223,000 in Third Quarter Ended Nov. 30
PUBLICARD INC: Court Confirms Amended Plan of Reorganization
QLT INC: Board Gives "Go" Signal to Sell Unit and Cut Jobs
QUEBECOR WORLD: Fails to Obtain $125 Mil. Financing by Jan. 15
QUEBECOR WORLD: Moves Rescue Financing Term Compliance Deadline
QUEBECOR WORLD: Interest Nonpayment Spurs S&P to Give D Ratings
RADNOR HOLDING: Wants Plan Solicitation Period Extended to Apr. 21
RALI SERIES 2007: Moody's Downgrades Ratings on 17 Tranches
REGAL ENTERTAINMENT: Fitch Holds 'B+' Issuer Default Rating
REMOTE MDX: Hansen Barnett Raises Going Concern Doubt
RENAISSANCE HOME: Public Auction of Securities Set for Feb. 15
RESIDENTIAL ACCREDIT: Moody's Downgrades Ratings on 25 Tranches
RESIDENTIAL ACCREDITED: Fitch Chips Ratings on 90 Loan Classes
RESIDENTIAL ASSET: S&P Downgrades Ratings on Three Classes
RISKMETRICS GROUP: Planned IPO Cues Moody's Rating Review
ROUNDY'S SUPERMARKETS: S&P Revises Outlook from Negative to Stable
SAFEVEST GLOBAL: Voluntary Chapter 11 Case Summary
SALOMON BROTHERS: Moody's Junks Rating on $13.7MM Cert.
SCAN INTERNATIONAL: Can Hire ARG LLC as Liquidation Consultants
SCAN INTERNATIONAL: Panel Can Hire Tydings & Rosenberg as Counsel
SCAN INTERNATIONAL: Taps Keen Consultant as Real Estate Advisor
SHORT-TERM ASSET: S&P Puts BB Rating on CreditWatch Negative
SLI MANAGEMENT: Case Summary & Five Largest Unsecured Creditors
SPATIALIGHT INC: Files Voluntary Chapter 7 Petition
SPONGETECH DELIVERY: Earns $8,668 in Second Quarter Ended Nov. 30
STRUCTURED ASSET: Fitch Rates $11.2 Mil. Class B Certs. at BB+
SUN MICROSYSTEMS: Expects Revenue of $3.6 Bil. in FY 2008 2nd Qtr.
SUN MICROSYSTEMS: Signs $1 Billion Pact to Acquire MySQL
SUN MICROSYSTEMS: S&P Ratings Unaffected by $1 Bil. MySQL Deal
SUSAN JOHNSON: Case Summary & Ten Largest Unsecured Creditors
TCO FUNDING: Moody's Holds B2 Rating with Stable Outlook
TELEPACIFIC HOLDINGS: S&P Revises Outlook to Negative
TEXHOMA ENERGY: GLO CPA's Raises Going Concern Doubt
TEXAS WESLEYAN: Moody's Keeps Ba2 Rating on Series 1997A Bonds
THOMPSON CREEK: Moody's Maintains Corporate Family Rating at B3
THORNBURG MORTGAGE: Fitch Holds 'BB' Rating on Class B-5 Certs.
TIBERIAS INC: Voluntary Chapter 11 Case Summary
TIMBERSTAR TRUST: Fitch Holds 'BB' Rating on $130MM Cl. F Certs.
TOUSA INC: Misses Jan. 15 Interest Payment for 7.5% Sr. Notes
UNICO INC: Nov. 30 Balance Sheet Upside-Down by $6.9 Million
VPI ACQUISITION: Case Summary & Two Largest Unsecured Creditors
WR GRACE: Court Commences Asbestos Estimation Trial
WACHOVIA BANK: Moody's Maintains Low-B Ratings on Six Classes
WASHIGNTON MUTUAL: Discloses $1.87BB Loss After $1.6BB Writedown
WCI COMMUNITIES: Amends Credit Deals to Waive Loan Covenants
XIOM CORP: Michael Studer Expresses Going Concern Doubt
YCL MILFORD: Case Summary & 19 Largest Unsecured Creditors
* Arizona Bankruptcy Filing Rose 60% in 2007
* U.S. Economy Experiences Modest Growth in 2007, Fed Reserve Says
* BOOK REVIEW: American Commercial Banking: A History
*********
3700 ASSOCIATES: Receives Notice of Default from Deutsche Bank
--------------------------------------------------------------
3700 Associates LLC, construction developer of Cosmopolitan Resort
& Casino in Las Vegas, Nevada, was issued a foreclosure notice by
Deutsche Bank AG Wednesday, various reports say.
The development project, valued at $3 billion, was partly funded
by a $760 million construction loan from Deutsche Bank that has
become due and payable, reports relate, citing 3700 Associates
owner Ian Bruce Eichner.
Mr. Eichner, according to the reports, said he was not shocked at
the foreclosure notice and added that he was currently in
collaboration with Deutsche Bank and Merrill Lynch & Co. in search
for interested investors.
The developer's financial problems spurred from the crisis in the
housing and financial markets, which is beyond its ability,
reports say, citing Mr. Eichner.
Spokesman of the project said that about 84% of the hotel units
were already sold out and added that Global Hyatt will manage the
hotel as a Grand Hyatt, the reports relate.
According to Mr. Eichner, 3700 Associates is currently engaged in
several discussions with parties, based on the reports.
Undisclosed lenders stated they will extend loan to complete the
project at Cosmopolitan Resort only if 3700 Associates can raise
its equity by 10%, the reports reveal.
Meanwhile, Deutsche Bank and Merrill Lynch refused to comment on
the issue.
Perini Confirms Delivery of Default Notice
Perini Corporation confirmed that Deutsche Bank, on Jan. 16, 2008,
delivered a notice of loan default to 3700 Associates.
Perini Building Company, Inc., a wholly-owned subsidiary of Perini
Corporation, is the general contractor for the project which is
scheduled for completion in December of 2009.
Currently, Perini is in discussions with developer, 3700
Associates and lender, Deutsche Bank, to facilitate an orderly
continuation of
construction of the project. Pending the outcome of the
discussions, the company is unable to determine the financial
impact, if any, at this time. Meanwhile, construction work
continues and all current amounts due to Perini have been paid
pursuant to the terms of the construction contract.
As of Dec. 31, 2007, work remaining to be performed under the
construction contract totaled approximately $1.4 billion.
About Perini Corporation
Perini Corporation (NYSE: PCR) -- http://www.perini.com/-- is a
construction services company offering diversified general
contracting, construction management and design/build services to
private clients and public agencies throughout the world. It
provided construction services since 1894. It offers general
contracting, preconstruction planning and comprehensive project
management services, including the planning and scheduling of the
manpower, equipment, materials and subcontractors required for a
project. It also offers self-performed construction services
including sitework, concrete forming and placement and steel
erection. It is known for our hospitality and gaming industry
projects, sports and entertainment, educational, transportation,
healthcare, biotech, pharmaceutical and high-tech facilities, as
well as large and complex civil construction projects and
construction management services to U.S. military and government
agencies.
About 3700 Associates
The 3700 Associates LLC is a real estate developer owned by Ian
Bruce Eichner. It is currently developing Cosmopolitan Resort &
Casino, a 3,000-room high-rise casino and hotel due to open in
late 2009 between the Bellagio casino resort and the CityCenter
casino complex. The project cost, initially valued at $1.8
billion, has ballooned to $3 billion. On Oct. 11, 2005, 3700
Associates signed a $1 billion construction contract with Perini
Corporation's subsidiary, Perini Building Company, Inc.
ACE SECURITIES: S&P Cuts 53 Classes' Ratings on Monthly Losses
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 53
classes of asset-backed pass-through certificates from nine Ace
Securities Corp. Home Equity Loan Trust deals. Twenty-six of the
classes were downgraded to speculative-grade from investment-
grade. Concurrently, S&P affirmed its ratings on all of the
remaining classes of mortgage pass-through certificates from these
nine series.
The table below shows the current performance data of the nine
series.
Performance Data
Cum. realized Severe
Series losses(i) delinq.(ii)
------ ------------- -----------
2002-HE2 1.87% 11.67%
2004-HE4 1.17% 32.06%
2004-HS1 1.68% 24.54%
2005-AG1 0.95% 27.93%
2005-HE1 1.48% 29.02%
2005-HE2 1.14% 39.87%
2005-HE5 1.87% 35.90%
2005-HE6 1.78% 32.45%
2005-HE7 1.98% 27.32%
(i )As a percentage of original pool balance.
(ii) As a percentage of current pool balance.
Current pool bal. Months
Series (orig. pool bal.) seasoned
------ ----------------- --------
2002-HE2 5.48% 61
2004-HE4 15.78% 36
2004-HS1 15.93% 45
2005-AG1 49.11% 25
2005-HE1 18.26% 34
2005-HE2 23.07% 32
2005-HE5 36.47% 27
2005-HE6 46.89% 26
2005-HE7 51.91% 24
The downgrades reflect adverse collateral performance that has
caused monthly losses to exceed excess interest. This trend has
led to the deterioration of overcollateralization (O/C) and credit
support from subordination. As shown in the lists above,
cumulative realized losses as a percentage of original pool
balance for the downgraded transactions range from 0.95% (series
2005-AG1) to 1.98% (series 2005-HE7). Class B-3 from series 2005-
HE5 has taken principal write-downs, and as a result, S&P lowered
its rating on this class to 'D' from 'CCC'.
The delinquency pipeline in many of the transactions strongly
suggests that the trend of monthly losses exceeding excess
interest will continue, further compromising credit support. As
of the January 2008 remittance period, severe delinquencies (90-
plus days, foreclosures, and REOs) for the downgraded
transactions ranged from 11.67% (series 2002-HE2) to 39.87%
(series 2005-HE2).
S&P affirmed its ratings on the remaining classes from these
series based on loss coverage percentages that are sufficient to
maintain the current ratings despite the negative trends in the
underlying collateral of many of the deals.
Subordination, O/C, and excess spread provide credit support for
all of the affected deals. The collateral for these transactions
primarily consists of subprime, adjustable-, and fixed-rate
mortgage loans secured by first liens on one- to four-family
residential properties.
Ratings Lowered
Ace Securities Corp. Home Equity Loan Trust
Asset-backed pass-through certificates
Rating
------
Series Class To From
------ ----- -- ----
2002-HE2 M-3 CCC B
2002-HE2 M-4 CCC B-
2004-HE4 M-5 A- A+
2004-HE4 M-6 BB+ A
2004-HE4 M-7 BB A
2004-HE4 M-8 BB- A-
2004-HE4 M-9 B BB
2004-HE4 M-10 B- BB-
2004-HE4 M-11 CCC B
2004-HS1 M-1 A- AA+
2004-HS1 M-2 BB AA-
2004-HS1 M-3 B BBB
2004-HS1 M-4 B- BBB-
2004-HS1 M-5 CCC B
2004-HS1 M-6 CCC B-
2005-AG1 M-4 A+ AA+
2005-AG1 M-5 BBB AA
2005-AG1 M-6 BB AA
2005-AG1 B-1 BB- AA-
2005-AG1 B-2 B+ A+
2005-AG1 B-3 B A
2005-AG1 B-4 B- BB
2005-AG1 B-5 CCC B
2005-HE1 M-7 BB+ BBB+
2005-HE1 M-8 B BBB
2005-HE1 M-9 B- BBB-
2005-HE1 B-1 CCC BB
2005-HE2 M-7 BB BBB+
2005-HE2 M-8 BB- BBB+
2005-HE2 M-9 B BBB
2005-HE2 M-10 B- BB+
2005-HE2 B-1 CCC B
2005-HE5 M-5 BBB+ A+
2005-HE5 M-6 BB A
2005-HE5 M-7 BB- A-
2005-HE5 M-8 B+ BBB
2005-HE5 M-9 B BB
2005-HE5 M-10 B- B
2005-HE5 B-1 CCC B
2005-HE5 B-3 D CCC
2005-HE6 M-5 BBB+ A+
2005-HE6 M-6 BB+ A+
2005-HE6 M-7 BB A
2005-HE6 M-8 BB- BBB
2005-HE6 M-9 B BB
2005-HE6 M-10 B- B
2005-HE6 M-11 CCC B
2005-HE7 M-6 A- A+
2005-HE7 M-7 BB+ A
2005-HE7 M-8 BB A
2005-HE7 M-9 B+ BBB+
2005-HE7 M-10 B BBB
2005-HE7 M-11 CCC BB
Ratings Affirmed
Ace Securities Corp. Home Equity Loan Trust
Asset-backed pass-through certificates
Series Class Rating
------ ----- ------
2002-HE2 M-1 AAA
2002-HE2 M-2 BBB
2004-HE4 M-1, M-2 AA+
2004-HE4 M-3, M-4 AA
2004-HE4 B CCC
2004-HS1 A-2, A-3 AAA
2005-AG1 A-1A, A-1B1, A-1B2 AAA
2005-AG1 A-2A, A-2B, A-2C AAA
2005-AG1 A-2D, M-1, M-2 AAA
2005-AG1 M-3 AA+
2005-HE1 A-1A, A-1B AAA
2005-HE1 M-1 AA+
2005-HE1 M-2 AA
2005-HE1 M-3 AA-
2005-HE1 M-4 A+
2005-HE1 M-5 A
2005-HE1 M-6 A-
2005-HE1 B-2 CCC
2005-HE2 A-1, A-2C AAA
2005-HE2 M-1 AA+
2005-HE2 M-2 AA
2005-HE2 M-3 AA-
2005-HE2 M-4, M-5 A+
2005-HE2 M-6 A
2005-HE2 B-2 CCC
2005-HE5 A-1, A-2A, A-2B AAA
2005-HE5 A-2C AAA
2005-HE5 M-1 AA+
2005-HE5 M-2, M-3 AA
2005-HE5 M-4 AA-
2005-HE5 B-2 CCC
2005-HE6 A-1, A-2A, A-2B AAA
2005-HE6 A-2C, A-2D AAA
2005-HE6 M-1 AA+
2005-HE6 M-2, M-3 AA
2005-HE6 M-4 AA-
2005-HE6 B-1 CCC
2005-HE6 B-2 CCC
2005-HE7 A-1A, A-1B1, A-1B2 AAA
2005-HE7 A-2A, A-2B, A-2C AAA
2005-HE7 A-2D AAA
2005-HE7 M-1, M-2 AA+
2005-HE7 M-3, M-4 AA
2005-HE7 M-5 AA-
AEGIS ASSET: Moody's Cuts Ratings on Six Classes from Two Deals
---------------------------------------------------------------
Moody's Investors Service downgraded six classes of certificates
from two deals issued by Aegis Asset-Backed Securities Trust in
2003. The actions are based on the analysis of the credit
enhancement provided by subordination, overcollateralization and
excess spread relative to expected losses.
Both deals have already stepped down. Erosion of
overcollateralization (OC) and subordination levels due to
stepdown and losses has left the rated bonds less protected
against expected remaining losses. As of December 2007, Aegis
Asset Backed Securities Trust, Mortgage Pass-Through Certificates,
Series 2003-1 has a pool of factor of less than 7% and no OC for a
required OC of $1.4 million. Class B-1 has taken $1,312,207 of
cumulative losses and has a current tranche balance of $842,142,
from an original face amount value of $8,591,321.
As of December 2007, Aegis Asset Backed Securities Trust, Mortgage
Pass-Through Certificates, Series 2003-2 has a pool of factor of
9%. OC was below target, providing $316,683 protection against
$5,927,790 worth of loans in Foreclosure and REO. The deals are
backed by subprime, fixed and adjustable-rate mortgage loans.
Complete rating actions are:
Issuer: Aegis Asset-Backed Securities Trust, Mortgage Pass-Through
Certificates, Series 2003-1
-- Class M-1, downgraded from Aa2 to A3;
-- Class M-2, downgraded from Baa2 to B3;
-- Class B-1, downgraded from Caa2 to C;
Issuer: Aegis Asset-Backed Securities Trust, Mortgage Pass-Through
Certificates, Series 2003-2
-- Class M-1, downgraded from Aa2 to A2;
-- Class M-2, downgraded from A2 to Baa3;
-- Class B, downgraded from B2 to Caa2.
AMERICA'S FIRST: Asks Seminole Court's Okay to Liquidate Assets
---------------------------------------------------------------
America's First Home asked the Seminole County Court for
permission to dispose its assets, Dick Hogan writes for The News
Press. The company intends to use the proceeds to pay its
creditors.
The homebuilder requested the appointment of Lewis Freeman, a
Miami accountant, as its receiver, News Press relates.
Creditors must submit by April 20, 2008, their proofs of claims
with the Court, News Press reports.
Among the creditors is Randy Krise, managing member of Miracle
Plaza FM LLC, who is owed owed $23,000 in rent, News Press
Altamonte Springs-based America's First Home --
http://www.americasfirsthome.net/-- went from building 92 houses
in 1999 statewide to more than 1,000 in 2005, according to its Web
site, which is currently under construction. It was formed by
Bill Frey, the founder of Frey & Son. His son, Barry Frey is Frey
& Son's current president.
AMERICAN HOME: Moody's Cuts 16 Tranches' Ratings on Delinquency
---------------------------------------------------------------
Moody's Investors Service downgraded the ratings of sixteen
tranches and has placed under review for possible downgrade the
ratings of five tranches from four transactions issued by in
2007. The collateral backing these classes primarily consists of
first lien, adjustable-rate negatively amortizing Alt-A mortgage
loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
American Home Mortgage Assets Trust 2007-1
-- Cl. M-7, Downgraded to Baa1, previously A3,
-- Cl. M-8, Downgraded to Ba1, previously Baa1,
American Home Mortgage Assets Trust 2007-4
-- Cl. M-1 Currently Aa1, on review for possible downgrade,
-- Cl. M-2 Currently Aa2, on review for possible downgrade,
-- Cl. M-3 Currently Aa3, on review for possible downgrade,
-- Cl. M-4, Downgraded to Baa1, previously A1,
-- Cl. M-5, Downgraded to Baa3, previously A2,
-- Cl. M-6, Downgraded to Ba3, previously Baa1,
American Home Mortgage Assets Trust 2007-5
-- Cl. M-4 Currently Aa3, on review for possible downgrade,
-- Cl. M-5, Downgraded to A2, previously A1,
-- Cl. M-6, Downgraded to A3, previously A1,
-- Cl. M-7, Downgraded to Baa2, previously A3,
-- Cl. M-8, Downgraded to Ba1, previously Baa1,
-- Cl. M-9, Downgraded to Ba3, previously Baa2,
American Home Mortgage Investment Trust 2007-1
-- Cl. M-5 Currently Aa3, on review for possible downgrade,
-- Cl. M-6, Downgraded to A2, previously A1,
-- Cl. M-7, Downgraded to Baa1, previously A2,
-- Cl. M-8, Downgraded to Baa2, previously A3,
-- Cl. M-9, Downgraded to Ba1, previously Baa1,
-- Cl. B-1, Downgraded to B3, previously Ba2,
-- Cl. B-2, Downgraded to Caa2, previously B3.
AMR CORP: Posts $69 Million Net Loss in 2007 Fourth Quarter
-----------------------------------------------------------
AMR Corporation, the parent company of American Airlines Inc.,
reported Wednesday a net loss of $69 million for the fourth
quarter of 2007.
The results for the fourth quarter of 2007 include the impact of
several special items that amounted to a cumulative positive
impact of approximately $115 million. These items include: a
$138 million gain on the sale of AMR's stake in ARINC; a
$39 million gain to reflect the positive impact of the previously
announced change to an 18-month expiration of Aadvantage(R) miles;
and a $63 million charge associated with the retirement of 24 MD-
80 aircraft that previously had been temporarily stored.
The current quarter results compare to a net profit of $17 million
for the fourth quarter of 2006.
For all of 2007, AMR posted a net profit of $504 million. In
addition to the special items from the fourth quarter, the full-
year 2007 results also include the impact of a $30 million charge,
disclosed in the third quarter, to reflect an adjustment for
additional salary and benefit expense accruals related to years
2003 through 2006.
AMR's full-year 2007 results compare to a net profit of
$231 million net profit, or $0.98 per diluted share, for all of
2006.
In the fourth quarter of 2007, total operating revenues were
$5.68 billion, a 5.3% increase from total operating revenues of
$5.4 million in the corresponding period in 2006.
For the year ended Dec. 31, 2007, total operating revenues were
$22.94 billion, compared with total operating revenues of
$22.56 billion in 2006.
"Our employees overcame enormous challenges from unprecedented
weather disruptions, air traffic control problems and record fuel
prices to help our company take another important step forward in
2007. We earned our second straight annual profit, achieving our
first back-to-back profitable years since 1999-2000, and made
progress in many areas, including strengthening our balance sheet,
focusing on customers, renewing our fleet, bolstering our network
and investing in products and services," said AMR chairman and
chief executive officer Gerard Arpey.
"While record fuel prices contributed significantly to our fourth
quarter loss - our first quarterly loss after six straight
profitable quarters - they are a reminder of the challenges we
must continue to overcome as we strive for consistent and adequate
profitability. As we thank our employees for their efforts in
2007, it is also clear that we have more work ahead as we seek to
maintain momentum in 2008 and beyond."
Operational Performance
American's mainline passenger revenue per available seat mile,
excluding special items, increased by 4.5% in the fourth quarter
compared to the year-ago quarter.
Mainline capacity, or total available seat miles, in the fourth
quarter increased 0.4% compared to the same period in 2006. The
year-over-year increase in capacity was largely the result of
previously announced aircraft density initiatives, mitigated
somewhat by weather-related cancellations. Fourth quarter
mainline departures declined slightly year over year.
American's mainline load factor - or the percentage of total seats
filled - was 80.2% during the fourth quarter, compared to 78.8% in
the fourth quarter of 2006. American's fourth-quarter yield,
which represents average fares paid, excluding special items,
increased 2.6% compared to the fourth quarter of 2006, its 11th
consecutive quarter of year-over-year yield increases.
Excluding special items, AMR reported fourth quarter consolidated
revenues of approximately $5.64 billion, an increase of 4.6% year
over year.
American's mainline cost per available seat mile in the fourth
quarter, excluding special items, increased 8.6% year over year.
The largest contributor to the year-over-year increase in unit
costs was fuel. In the fourth quarter, American paid $367 million
more than it would have paid at fourth quarter 2006 fuel prices.
Consolidated fuel expense in the fourth quarter was $412 million
higher than it would have been at fourth quarter 2006 fuel prices.
Excluding fuel and special items, mainline unit costs in the
fourth quarter increased by 0.6% year over year, largely
reflecting a $44 million accrual in the fourth quarter for a one-
time payment to eligible employees under the company's broad-based
variable compensation plans. For the full year, the accrual for
the one-time payment totaled $67 million.
Arpey said the company's Board of Directors had approved the one-
time payment "in recognition of the collective effort of our
employees and the special circumstances that existed in 2007."
Each eligible American Airlines employee is expected to receive a
payment of $800 under the Customer Service Component of the
company's Annual Incentive Plan (AIP). "This is a tangible way of
saying 'thank you' for all that our employees did for our company
in a challenging year," he said.
Balance Sheet Improvement
AMR ended the fourth quarter with $5.0 billion in cash and short-
term investments, including a restricted balance of $428 million,
compared to a balance of $5.2 billion in cash and short-term
investments, including a restricted balance of $468 million, at
the end of the fourth quarter of 2006. AMR paid off $865 million
in debt in the fourth quarter, including scheduled debt payments
and an unscheduled $545 million aircraft debt prepayment. Of the
company's $2.3 billion in debt payments for all of 2007,
approximately $1 billion of those were prepayments.
AMR reduced Total Debt, which it defines as the aggregate of its
long-term debt, capital lease obligations, the principal amount of
airport facility tax-exempt bonds, and the present value of
aircraft operating lease obligations, to $15.6 billion at the end
of the fourth quarter of 2007, compared to $18.4 billion a year
earlier. AMR reduced Net Debt, which it defines as Total Debt
less unrestricted cash and short-term investments, from
$13.6 billion at the end of the fourth quarter of 2006 to
$11.0 billion in the fourth quarter of 2007.
As a result of scheduled principal payments as well as
prepayments, refinancings and other efforts to strengthen its
balance sheet, AMR's net interest expense for 2007 was
$174 million lower than in 2006, a 23.2% reduction.
As announced in October, AMR met its projected 2007 commitment to
fund its defined benefit pension plans for employees by
contributing $380 million to these plans through the first three
quarters of the year. AMR has contributed nearly $2 billion to
these plans since 2002, as the company continues to meet this
important commitment to employees. The company's 2007 pension
contributions, along with strong investment returns, higher market
discount rates and legislative changes to the mandatory pilot
retirement age, helped to improve the accumulated benefit
obligation funded status of AMR's pension plans to 96%, up from
84% at the end of 2006.
About AMR Corporation
Headquartered in Forth Worth, Texas, AMR Corporation (NYSE:
AMR) operates with its principal subsidiary, American Airlines
Inc. -- http://www.aa.com/-- a worldwide scheduled passenger
airline. At the end of 2006, American provided scheduled jet
service to about 150 destinations throughout North America, the
Caribbean, Latin America, Europe and Asia. American is also a
scheduled airfreight carrier, providing freight and mail services
to shippers throughout its system.
Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two
regional airlines, American Eagle Airlines Inc. and Executive
Airlines Inc., and does business as "American Eagle." American
Beacon Advisors Inc., a wholly owned subsidiary of AMR, is
responsible for the investment and oversight of assets of AMR's
U.S. employee benefit plans, as well as AMR's short-term
investments.
* * *
As reported in the Troubled Company Reporter on Nov. 30, 2007,
following the announcement by AMR Corp. that it intends to divest
its American Eagle Holding Corp. subsidiary in 2008, Fitch expects
no near-term impact on the debt ratings of AMR and its principal
operating subsidiary, American Airlines Inc. Fitch affirmed both
entities' Issuer Default Ratings at 'B-' on Nov. 13, 2007, while
revising the Rating Outlook for AMR to Positive.
ASARCO LLC: Wants to Hire Halpering Battaglia as Consulting Expert
------------------------------------------------------------------
ASARCO LLC and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of Texas to employ
Halperin Battaglia Raicht, LLP, as its consulting expert and
potential witness in connection with the fraudulent transfer
complaint against Americas Mining Corporation, nunc pro tunc
Nov. 2, 2007.
Halperin will assist ASARCO in the ongoing development and
analysis of the many issues involved in the AMC Litigation; and
will testify at trial to facilitate the orderly, unified
presentation and expert analysis of the various aspects of
evidence supporting ASARCO's position in the Litigation.
ASARCO will pay for Halperin's services according to the firm's
customary hourly rates:
Professionals Hourly Rate
------------- -----------
Attorneys $425 - $175
Law Clerks $125 - $100
Para-professionals $95 - $75
ASARCO will also reimburse Halperin for any necessary out-of-
pocket expenses the firm incurs.
Alan D. Halperin, Esq., a partner at Halperin Battaglia Raicht,
LLP, in New York, assures the Court that his firm does not
represent any interest adverse to ASARCO and its estate, and is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
The AMC Litigation, which is currently pending in the U.S.
District Court for the Southern District of Texas, is likely the
single largest asset of ASARCO's estate, Eric A. Soderlund, Esq.,
at Baker Botts, L.L.P., in Dallas, Texas, says.
Through the AMC Litigation, ASARCO seeks the return of its
ownership interest in Southern Peru Copper Corporation, which,
Mr. Soderlund says, is worth billions of dollars, along with the
present value of dividends paid on the stock since the fraudulent
transfer, believed to be worth more than $1,400,000,000. "The
multi-billion dollar value represented by the AMC Litigation will
only be realized if ASARCO can ultimately succeed on the merits
of the case, which success will be affected by the quality and
timeliness of the necessary expert retentions," Mr. Soderlund
contends.
About ASARCO
Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/
-- is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The
Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr.
S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L.
Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P.,
and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and
Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C.,
represent the Debtor in its restructuring efforts. Lehman
Brothers Inc. provides the ASARCO with financial advisory services
And investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee.
ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).
The Debtors' exclusive period to file a plan expires on
Feb. 11, 2008. (ASARCO Bankruptcy News, Issue No. 62; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
ASARCO LLC: Wants to Sell Perth Amboy Property for $19.8 Million
----------------------------------------------------------------
ASARCO LLC and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of Texas to:
(i) sell its 67-acre real property located in Perth Amboy,
New Jersey, to Emerald Bay Equity, LLC, for $19,800,000,
free and clear of all liens, claims and other interests;
and
(ii) assume certain permits and contracts related to the
Property.
Pursuant to a purchase and sale agreement, dated Dec. 10, 2007,
ASARCO and Emerald Bay agreed that Emerald Bay will:
-- pay ASARCO $19,800,000 in cash for the Perth Amboy
Property;
-- assume ASARCO's environmental obligations relating to the
Property, which ASARCO estimates to have a present value of
approximately $9,000,000;
-- release, defend, and indemnify ASARCO for any environmental
liabilities relating to the Property; and
-- execute an Administrative Consent Order with the New Jersey
Department of Environmental Protection for remediation of
the Property.
Emerald Bay has given a $495,000 deposit to General Land Abstract
Co., Inc., ASARCO's escrow agent, Tony M. Davis, Esq., at Baker
Botts, L.L.P., in Houston, Texas, tells the Court.
Mr. Davis says that in 1997, the city government of Perth Amboy
designated the Property as a redevelopment zone. In 2004, the
Perth Amboy Redevelopment Agency entered into a redevelopment
agreement with a designated redeveloper, PA-PDC Perth Amboy, LLC,
for the acquisition and redevelopment of the properties in the
designated zone.
Mr. Davis says that if PA-PDC is not able to acquire the Property
consensually, then the Redevelopment Agency may file a
condemnation action to acquire the Property. Any legal action to
acquire title of the Property through condemnation is subject to
defenses ASARCO may have and is currently subject to the
automatic stay imposed by Section 362 of the Bankruptcy Code.
Although there have been inquiries concerning the acquisition of
the Property, the redevelopment status has limited the ability to
market it, Mr. Davis tells the Court. ASARCO has delivered the
proposed Bidding Procedures to several entities that had
previously expressed a bona fide interest in the Property,
including PA-PDC.
Bidding Procedures
To maximize the value of the Property, ASARCO asks the Court to
approve uniform bidding procedures to govern an auction for the
sale of the Property:
(a) Any entity that wishes to participate in the bidding
process will deliver a competing offer for the Property to
Tom Aldrich, Ruth Kern, Baker Botts, L.L.P., and Reed
Smith, LLP, on a date still to be determined.
(b) To be considered a "Qualifying Bidder," a Competing Offer
must, among other things, be accompanied by a $750,000
good faith deposit; confirm that the bidder has completed
due diligence and has met with the U.S. Environmental
Protection Agency and the NJDEP; and must demonstrate that
the bidder understands the environmental issues associated
with the Property. The Competing Offer must create a
value that is at least $1,000,000 greater than the
Purchase Price.
(c) If one or more Qualifying Bids are received, ASARCO will
conduct an auction at a time and place still to be decided
on.
(d) Bidding will begin initially with the highest Qualifying
Bid and subsequently continue in minimum increments of at
least $250,000 higher than the previous bid.
(f) If ASARCO selects a buyer other than Emerald Bay, ASARCO
will pay a $750,000 break-up fee to Emerald Bay.
(g) If no Qualifying Bid is received, a hearing to consider
the sale of the Property to Emerald Bay will be held on a
date still to be decided on.
Feasibility Period
Mr. Davis further relates that the PSA provides Emerald Bay with
a "feasibility period" of 180 days after the Court approves the
proposed bidding procedures. During the Feasibility Period,
Emerald Bay will have the opportunity to:
-- inspect and investigate the physical and environmental
condition of the Property, its land use, zoning and
developments rights, and its permits, contracts and leases;
and
-- determine to its satisfaction the condition, quality,
merchantability or suitability of the Property for its own
purposes.
Emerald Bay will notify ASARCO, on or before the expiration of
the Feasibility Period, as to whether it approves or disapproves
of the Property. If Emerald Bay provides timely notice of
disapproval, the Agreement will terminate. Otherwise, Emerald
Bay will be deemed to have approved of the Property.
About ASARCO
Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/
-- is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The
Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr.
S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L.
Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P.,
and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and
Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C.,
represent the Debtor in its restructuring efforts. Lehman
Brothers Inc. provides the ASARCO with financial advisory services
And investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee.
ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).
The Debtors' exclusive period to file a plan expires on Feb. 11,
2008. (ASARCO Bankruptcy News, Issue No. 62; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
ASPEN EXECUTIVE: Wants to Extend Plan-Filing Deadline to May 12
---------------------------------------------------------------
Aspen Executive Air LLC asks the U.S. Bankruptcy Court for the
District of Delaware to extend its exclusive right to file for a
Plan of Liquidation until May 12, 2008, Bill Rochelle of the
Bloomberg News reports.
Mr. Rochelle relates the Debtor recently closed its sale of assets
to John P. Calamos, Pinnacle Air LLC's controlling shareholder.
Based in Basalt, Colorado, Aspen Executive Air, L.L.C., aka AEXJet
-- http://www.aexjet.com/-- is a private jet travel company. The
company filed for chapter 11 protection on Sept. 14, 2007 (Bankr.
D. Del. Case No. 07-11341). Laura Davis Jones, Esq., Bruce
Grohsgal, Esq., and Curtis A. Hehn, Esq., at Pachulski Stang Ziehl
& Jones LLP represent the Debtor. The Debtors have selected
Administar Services Group LLC as claims, noticing and balloting
agent. Donald J. Bowman, Jr., Esq., and Michael R. Nestor, Esq.,
at Young, Conaway, Stargatt & Taylor represent the Official
Committee of Unsecured Creditors. When the Debtor filed for
protection form its creditors, it listed assets between $1 million
and $100 million. The Debtor's list of 20 largest unsecured
creditors showed claims of more than $20 million.
ATLANTIS PLASTICS: Weak Liquidity Spurs Moody's to Junk Rating
--------------------------------------------------------------
Moody's Investors Service downgraded the Corporate Family Rating
and other instrument ratings of Atlantis Plastics, Inc. to Ca.
The outlook was changed to negative due to the continued poor
liquidity. This concludes the review for downgrade initiated
Sept. 20, 2007.
Moody's took these rating actions:
-- $25 million revolving credit facility due 2011, downgraded
to Caa3 (LGD 3, 42%) from Caa1 (LGD 3, 41%)
-- $120 million senior term loan due 2011, downgraded to Caa3
(LGD 3, 42%) from Caa1 (LGD 3, 41%)
-- $75 million junior term loan due 2012, downgraded to C
(LGD 5, 89%) from Caa3 (LGD 5, 80%)
-- Corporate Family Rating, downgraded to Ca from Caa2
-- Probability of Default Rating, downgraded to Ca from Caa2
The outlook is changed to negative from under review for
downgrade.
The downgrade of Atlantis's Corporate Family Rating to Ca reflects
the company's lack of success to date in negotiating a waiver and
amendment to its Credit Facilities for the breach of financial
covenants, lack of liquidity and likely impairment of the debt
instruments on an enterprise value basis. Atlantis's liquidity is
severely impaired given the lack of availability under its
revolver, little cash on hand and negative free cash flow. Moody's
believes that the company's value is less than its debt and that
each class of debt will realize losses in an event of default.
Atlantis has defaulted upon its covenants and received amendments
twice in the last two years.
Atlantis Plastics, Inc., headquartered in Atlanta, Georgia, is a
manufacturer of specialty polyethylene films and molded and
extruded plastic components used in a variety of industrial and
consumer applications. Atlantis has 15 manufacturing plants
located throughout the United States. Revenues for the twelve
months ended Sept. 30, 2007 were $398 million.
BON-TON STORES: S&P Revises Outlook to Negative & Holds Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on York,
Peensylvania-based Bon-Ton Stores Inc. to negative from stable. At
the same time, Standard & Poor's affirmed its existing ratings on
the company, including the 'B' corporate credit and 'CCC+' senior
unsecured credit ratings.
The outlook revision follows the company's disclosure that its
results for all of fiscal 2007 will be much weaker than expected.
Bon-Ton said that comparable-store sales for the combined months
of November and December were down 4%. "This was far worse than
the department store peer group, which averaged a 1% increase,"
said Standard & Poor's credit analyst Gerald A. Hirschberg.
Furthermore, Bon-Ton said that it was lowering full-year EBITDA
guidance to a range of $245 million to $253 million. "This is
also much lower than we had anticipated," said Mr. Hirschberg.
"We now expect that leverage for 2007 could be as high as 5.7x,
and EBITDA coverage of interest may be approximately only 1.9x."
Although these ratios are characteristic of a 'B' rating for
retailers in general, Standard & Poor's believes that economic
fundamentals and a weakening retail environment will continue to
pressure sales, margins, and credit measures for a good part of
2008.
BROTMAN MEDICAL: Alvarez & Marsal Approved as Panel's Advisor
-------------------------------------------------------------
The United States Bankruptcy Court for the Central District of
California gave the Official Committee of Unsecured Creditors of
Brotman Medical Center Inc. authority to employ Alvarez & Marsal
Healthcare Industry Group as its financial advisor.
Alvarez & Marsal is expected to review and evaluate the current
and prospective financial, and operational condition of the
Debtor, including but not limited to:
a) cash receipts and disbursement forecasts;
b) various plan of reorganization that may be considered or
pursued by the Debtor;
c) appraisals of assets prepared by the Debtor;
d) assets and liabilities, generally;
In addition, the firm will:
a) assist the committee in evaluating DIP or other financings
for the Debtor;
b) assist the Committee to analyze and evaluate potential
transactions or other plans and effort to sell assets,
recapitalize or reorganize the Debtor;
c) assist the Committee and its counsel in evaluating and
responding to various developments or motions during the
course of the Debtor's Chapter 11 including providing expert
testimony as may be acceptable to A&M.
d) represent and assist the Committee counsel in representing
the Committee in negotiations with the Debtor and third
parties;
e) provide other services that may be requested by the
Committee and as may also be acceptable to the firm.
The firm's professionals and their compensation rates are:
Designation Hourly Rate
----------- -----------
Managing Directors $525 - $650
Directors $425 - $500
Associates $325 - $400
Analysts $200 - $300
Ronald Winters, Esq., the managing director of the firm, assures
the Court that the firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
Headquartered in Culver City, California, Brotman Medical Center
Inc. -- http://www.brotmanmedicalcenter.com/-- provides range of
inpatient and outpatient services, as well as rehabilitation,
psychiatric care and chemical dependency. The company filed
for Chapter 11 protection on Oct. 25, 2007 (Bankr. C.D. Calif.
Case No. 07-19705). Courtney E. Pozmantier, Esq., and Stacia A.
Neeley, Esq., at Klee, Tuchin, Bogdanoff & Stern, L.L.P.,
represent the Debtor. The Debtor selected Kurtzman Carson
Consultants LLC as its claims and noticing agent. The Official
Committee of Unsecured Creditors has selected Benjamin S. Seigel,
Esq., and Paul S. Arrow, Esq., at Buchalter Nemer, as its counsel.
When the Debtor filed for bankruptcy, it listed assets and debts
between $1 million and $100 million.
BTC: Increased Credit Enhancement Cues Fitch to Lift Ratings
------------------------------------------------------------
BTC's commercial mortgage pass-through certificates, series BTR
Trust 1999-S1, are upgraded by Fitch Ratings as:
-- $3 million class G to 'AAA' from 'B+';
-- $5.6 million class H to 'AAA' from 'B-'.
Classes B, C, D, E and F are paid in full. The $40.2 million
class I certificates are not rated by Fitch.
The upgrades reflect the increased credit enhancement as a result
of loan payoffs and amortization. As of the April 2006
distribution date, the pool's aggregate principal balance has been
reduced by 89.1% to $48.8 million from $447 million at issuance.
Although, the transaction has limited loan diversity with only two
loans remaining in the pool, the credit enhancement levels were
sufficient to merit the upgrades. The transaction has no realized
losses to date.
The two remaining loans (100%) in the transaction are currently in
specially servicing and are both real-estate owned. The largest
specially serviced asset (83.8%) is a portfolio of office
properties located in Dallas, Texas. The special servicer is
continuing with their leasing efforts to increase occupancy before
marketing the properties for sale. Significant losses are
expected to be absorbed by the non-rated class I certificates.
The other specially serviced asset is a hotel located in San
Francisco, California, which originally transferred to the special
servicer as a result of a maturity default. The property lacks a
franchise affiliation and the special servicer is currently
marketing it for sale. Minimal losses are expected and should be
absorbed by class I.
CABLEVISION CORP: S&P Maintains BB Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit rating on Bethpage, Long Island-based cable operator
Cablevision Corp. and removed the ratings from CreditWatch where
they were placed on May 2, 2007, with negative implications. The
outlook is negative.
At the same time, Standard & Poor's affirmed its 'B+' senior
unsecured debt rating for Cablevision, intermediate holding
company CSC Holdings Inc. and subsidiary Rainbow National Services
LLC, and also affirmed its 'B+' subordinated debt rating and 'BBB-
' senior secured rating and its '1' recovery rating on Rainbow
National Services. In addition, the rating on intermediate
holding company CSC Holdings Inc.'s $5.5 billion of secured bank
facilities was raised to 'BBB-' from 'BB' and the recovery rating
was revised to '1'. All ratings have been removed from
CreditWatch.
The upgrade for this bank loan reflects Standard & Poor's revised
bank loan methodology, adopted in June 2007, which was not applied
to CSC Holding's bank loan because it was on CreditWatch at that
time. The ratings were placed on CreditWatch with negative
implications following the announcement that Cablevision's board
of directors had accepted a buyout offer by the Dolan Family
Group. Shareholders subsequently rejected the buyout in October
2007, but the ratings remained on CreditWatch pending S&P's review
of the company's financial policy and financial and operating
plans.
As of Sept. 30, 2007, the company had about $11.3 billion of total
funded debt outstanding, excluding collateralized debt
obligations.
Cablevision's ratings reflect the attractive demographics of the
area served by the company's cable TV systems in the metro New
York/New Jersey/Connecticut area, which comprise about 3.1 million
basic cable customers. This has contributed to very good
broadband penetration relative to the industry of 71%, and high
overall subscriber average revenue per user in excess of $120, one
of the highest levels in the industry, as well as healthy cable
EBITDA margins of about 38%. This business is therefore
considered to have a satisfactory business position.
However, the attractive nature of the subscriber base has also
prompted aggressive competition from Verizon's FiOS
television/broadband services over the last year, which could
accelerate even further in 2008 as Verizon increasingly receives
video franchise relief from local regulators in
Cablevision's markets.
"We note that it would likely take several years for Cablevision
to demonstrate that it can minimize losses to FiOS. Even if the
FiOS impact can be blunted, a revision to a stable outlook would
also require a tempered financial policy," said Standard & Poor's
credit analyst Catherine Cosentino.
CAPCO AMERICA: Fitch Holds 'B-' Rating on $24.9MM Cl. B-4 Certs.
----------------------------------------------------------------
Fitch Ratings lowers the Distressed Recovery rating on CAPCO
America Securitization Corp.'s commercial mortgage pass-through
certificates, series 1998-D7 as:
-- $15.6 million class B-5 to 'CC/DR4' from 'CC/DR3'.
In addition, Fitch affirms these classes:
-- $629.3 million class A-1B at 'AAA';
-- Interest-only class PS-1 at 'AAA';
-- $62.3 million class A-2 at 'AAA';
-- $68.5 million class A-3 at 'AAA';
-- $59.2 million class A-4 at 'AAA';
-- $21.8 million class A-5 at 'AAA';
-- $31.1 million class B-1 at 'AA-';
-- $28 million class B-2 at 'BBB+';
-- $15.6 million class B-3 at 'BB+';
-- $24.9 million class B-4 at 'B-';
Fitch does not rate the $1.6 million class B-6 and B-6H
certificates.
The class A-1A class has been paid in full.
Class B-5 remains at 'CC' and the DR rating is being lowered due
to increased loss expectations associated with the two specially
serviced assets.
The rating affirmations are due to defeasance and paydown since
Fitch's last ratings action being moderated by increased loss
expectations on the specially serviced assets and an increase in
Fitch Loans of Concern. Fitch Loans of Concern include the
Specially Serviced loans and loans with low occupancy, debt
service coverage ratio's and other performance issues.
Fifty-five loans (33.8%) have defeased since issuance, including
two of the top five loans (9.6%). As of the March 2007
distribution date, the pool has paid down 23.1% to $958 million
from $1.25 billion at issuance.
There are currently two assets (1.8%) in special servicing, both
of which are real estate owned. The largest specially serviced
asset (1%) is an office property located in Dayton, Ohio. The
property is listed for sale and the special servicer is currently
evaluating purchase offers. The other specially serviced asset
(0.6%) is an industrial property located in Baltimore, Maryland
and is currently listed for sale. Based on recent appraised
values, losses are expected on both assets.
The fourth largest asset in the pool (4.5%) is a retail mall
located in Charlotte, North Carolina and is considered a Fitch
Loan of Concern. Although the loan is current, a non-collateral
anchor tenant vacated at the end of 2006. Fitch will continue to
monitor the performance of this asset.
CENTRO NP: Moody's Slashes Senior Debt Rating to B3 From B1
-----------------------------------------------------------
Moody's Investors Service downgraded the senior unsecured debt
ratings of Centro NP LLC to B3, from B1, as the company moves
closer to its Feb. 15, 2008 refinancing deadline and its parent,
Centro Properties Group, discloses additional liquidity and
accounting issues. The ratings remain on review for downgrade.
These ratings actions reflect the continued financial
difficulties, accounting issues, increased exposure to currency
rate fluctuations, and potential Australian Securities &
Investments Commission disclosure investigation. Moody's also
expects that Centro NP LLC will have heightened leverage and
secured debt following the take-out of the bridge financing, and
significant property sales to fund debt. Moody's review will
focus on the final capital structure and strategic profile of the
company in light of Centro NP's and Centro Properties Group's
short-term pressure to refinance debt. Moody's will continue to
monitor Centro NP's compliance with its bond covenants and the
quality and composition of its portfolio as it works though these
financings.
Moody's acknowledges that Centro NP has a defensive portfolio with
a $6.3 billion market value that may afford opportunities for
asset sales or financing to pay off debt. Since the acquisition,
the bridge loan has been reduced to approximately $1.75 billion
due to a $300 million CMBS issuance and the conversion of $400
million to a one-year term loan. Centro Properties Group is
operating its US community and neighborhood shopping center
portfolio from Centro NP's New York City headquarters, utilizing
New Plan's nationwide operating infrastructure and staff as its
base. Glenn Rufrano, the CEO of Centro NP, was appointed the CEO
of Centro Properties Group this week. He brings greater
independence to the restructuring process and a deep knowledge of
financing availability in the US, where two-thirds of Centro's 810
property portfolio is situated.
Upwards rating movement would be contingent upon Centro NP
refinancing the bridge facility by Feb. 15, 2008 without
materially pressuring their leverage, secured debt, the value of
their portfolio, and other credit metrics, while complying with
bond covenants, in addition to a viable plan to restructure Centro
Properties Group's debt. A confirmation of the B3 rating would
result from Centro NP reaching a financing plan to which the debt
holders agree, with a strategic plan in place to restructure
Centro Properties Group's debt. A downgrade to the Caa range or
lower would most likely reflect Centro NP's continued issues
refinancing its line and/or Centro Properties Group's inability to
finance its debt, noncompliance with bond covenants at the Centro
NP level, acceleration of bond payments, a firesale of assets or a
bankruptcy filing. Although the maturity date of both the bridge
facility and the line of credit were extended to Feb. 15, 2008,
this date may be extended by the bank group.
These ratings were lowered to B3, and placed under review for
downgrade:
Centro NP LLC
-- senior unsecured debt to B3, from B1;
-- medium-term notes to B3, from B1.
Centro NP LLC, headquartered in New York City, owns and operates
465 community and neighborhood shopping centers in 38 states. The
company had assets of $6.3 billion and equity of $3.8 billion at
Sept. 30, 2007.
Centro Properties Group, headquartered in Melbourne, Victoria,
Australia, is an Australian Listed Property Trust that specializes
in the ownership, management and development of retail shopping
centers in Australia, New Zealand and the USA with A$26.6 billion
in assets under management.
CENTRO PROPERTIES: Bracewell & Giuliani Represents Noteholders
--------------------------------------------------------------
The U.S. noteholders of Centro Properties Group are being
represented by Bracewell & Giuliani LLP, according to Bloomberg
News.
According to Bloomberg, the U.S. law firm confirmed a report in
the Australian Financial Review that it is acting for the
Centro Properties investors.
Bracewell & Giuliani LLP is an international law firm with more
than 400 lawyers in Texas, New York, Washington DC, Connecticut,
Dubai, Kazakhstan and London. The firm serves clients
concentrated in the energy and financial services sectors
worldwide.
Looming Refinancing Deadline
As reported in the Troubled Company Reporter on Jan. 16, 2008,
Centro Properties received advice from its U.S. Private
Placement Noteholders who are collectively owed $450 million,
which suggested that one or more events of default under the
relevant Note Purchase Agreements may have arisen under some or
all of the Notes.
Centro has not conceded that there are any such defaults.
However, Centro has entered into an agreement with the Noteholders
through to Feb. 15, 2008 (or such later date as may be agreed) for
the Noteholders not to act on the events, consistent with its
arrangements with the lenders who are parties to the extension
agreements.
Both the Australian and U.S. lenders have concurred with the
arrangements.
Centro said it is in regular dialogue with the lenders who are
parties to the Australian Extension Deed dated Dec. 17, 2007, and
is expected to continue. According to Centro, the lenders are
currently considering extending the arrangements under the
Extension Deed beyond Feb. 15, 2008.
The U.S. lenders are also considering an extension of their
current maturities beyond Feb. 15, 2008, Centro noted.
CEO Quits
Amid trouble in the company's finances, Andrew Scott resigned
as Chief Executive Officer and as a director of Centro Properties
Group.
Glenn Rufrano has been appointed as Chief Executive Officer
effective immediately.
Since the acquisition of New Plan by Centro, Mr. Rufrano has been
Chief Executive Officer of Centro US. Mr. Rufrano was formerly
the Chief Executive Officer of New Plan, prior to its acquisition
by Centro in April 2007.
About Centro Properties
Centro Properties Group is a retail investment organisation
specialising in the ownership, management and development of
retail shopping centres. Centro manages both listed and
unlisted retail property and has an extensive portfolio of
shopping centres across Australia, New Zealand and the United
States. Centro has funds under management in excess of
$26.6 billion.
CHARTERHOUSE BOISE: Developer Given Chance to Avoid Foreclosure
---------------------------------------------------------------
Chapter 11 trustee Ilene Lashinsky and bankruptcy attorney John
Woodbery, Esq., agreed to give Charterhouse Boise Downtown
Properties' owner Gary Rogers an opportunity to avoid foreclosure
of the property, the Associated Press reports.
Mr. Woodbery is Charhouse Boise's local counsel in its bankruptcy
proceedings.
As reported in the Troubled Company Reporter on Aug. 8, 2007,
Rogers had planned to construct a 34-story tower project dubbed
"Boise Place." Financial problems however prompted Mr. Rogers to
redesign and build a shorter tower. Rodgers had already defaulted
on a $2.6 million loan while his architect filed a $500,000 lien
against the project.
Rogers filed for bankruptcy to reorganize and keep the project
going. However, according to court documents, Rogers failed to
file the Debtor's monthly operating reports -- from August to
December 2007 -- and pay overdue bankruptcy fees, says the AP.
As a result, the Chapter 11 Trustee asked the Court to convert the
Debtor's case into a Chapter 7 liquidation proceeding.
Early this week however, Mr. Woodbery and Ms. Lashinsky agreed to
let Rogers pay the fees and file the Debtor's much-delayed MOR's,
the AP relates. The developer was given until January 22 to
rectify the problem.
If the deadline is not met, the AP says, the Trustee will ask the
Court again to convert the case which would pavie the way for the
Debtor's largest secured creditor, Robert Capps Homes Inc., to
foreclose on the building.
Based in Boise, Idaho, Charterhouse Boise Downtown Properties LLC
develops real estate. The company filed for Chapter 11 protection
on Aug. 1, 2007 (Bankr. D. Idaho Case No. 07-01199). Thomas James
Angstman, Esq. at Angstman, Johnson & Associates, represents the
Debtor in its restructuring efforts. The Debtor also chose John
E. Woodbery, Esq., at Woodbery Law Group, P.S., as its local
counsel. The Debtor's schedules of assets and liabilities showed
total assets of $10,735,293, and $12,369,052 in total debts.
CHESAPEAKE CORP: Amends Fourth Quarter 2007 Credit Covenants
------------------------------------------------------------
Chesapeake Corporation has agreed with its lenders on the
amendment of certain fourth quarter 2007 covenants of its Senior
Revolving Credit Facility in anticipation of the lower than
expected fourth quarter 2007 operating results.
Lower than expected fourth quarter volumes, notably in the South
African beverage business and certain areas within the
pharmaceutical and healthcare packaging business, combined with
higher than expected startup expenses for a new product line in
the alcoholic drinks packaging business, are the primary reasons
for the shortfall.
In addition, the company had expected to receive the cash proceeds
from the sale of its tobacco packaging facility in Bremen, Germany
before year end, but the cash proceeds were not received until the
first week of January. Preliminary 2007 operating earnings,
excluding special items, are now expected to be approximately $41
million compared to $45 million for 2006.
The company's Senior Revolving Credit Facility was amended for the
fourth quarter of 2007 to increase the total leverage ratio from
5.00 to 5.30 and decrease the interest coverage ratio from 2.25 to
2.15. The credit facility lending group is led by Wachovia Bank,
N.A., as administrative agent.
"We appreciate the continued support of our bank group," said
Andrew J. Kohut, Chesapeake president & chief executive officer.
"Business conditions in our industry remain competitive, and we
face short-term challenges. However, we are encouraged by several
successes with new orders. We are also focused on exploring
alternatives for non-core or redundant assets to improve our
operating results and reduce debt."
About Chesapeake Corporation
Headquartered in Richmond, Virginia, Chesapeake Corporation
(NYSE:CSK) -- http://www.cskcorp.com/-- is a supplier of
specialty paperboard packaging products in Europe and an
international supplier of plastic packaging products to niche
end-use markets. Chesapeake has 47 locations in France,
Ireland, United Kingdom, North America, China, HongKong, among
others and employs approximately 5,500 people.
CHESAPEAKE CORP: Moody's Puts Ratings on Review & May Downgrade
---------------------------------------------------------------
Moody's Investors Service placed all the credit ratings of
Chesapeake Corporation on review for possible downgrade. This
rating action follows Chesapeake's public revision downward of its
2007 earnings guidance, primarily due to a shortfall in expected
fourth quarter volumes combined with startup expenses for a new
product line. On Jan. 16, 2008, the company announced that it had
received financial covenant relief from its bank group for its
senior secured (stock pledge only) revolver for the fourth quarter
of 2007. The maximum total leverage ratio permitted for the
period was increased to 5.3x from 5.0x and the minimum interest
coverage ratio was decreased to 2.15x from 2.25x. Despite this
amendment, Moody's remains concerned about the company's ability
to comply with financial covenants over the near term.
The review for possible downgrade will primarily focus on the
company's run-rate operations and expected liquidity profile.
Notably, the review will explore Moody's concerns surrounding the
company's ability to maintain compliance with the financial
covenants contained in the existing amended senior secured credit
facility, for which the thresholds adjust to considerably tougher
levels as of the first quarter of 2008. The maximum total
leverage ratio permitted will decrease to 4.25x and the minimum
interest coverage ratio permitted will increase to 2.5x.
Moody's placed these ratings of Chesapeake Corporation on review
for possible downgrade:
-- $50 million senior unsecured revenue bonds due 2019, B1
(LGD 3, 48%)
-- GBP67.1 million 10.375% senior subordinated notes due
2011, B3 (LGD 5, 87%)
-- EUR100 million 7.0% senior subordinated eurobonds due
2014, B3 (LGD 5, 87%)
-- Corporate Family Rating, B1
-- Probability of Default Rating, B1
Headquartered in Richmond, Virginia, Chesapeake Corporation is a
leading international supplier of specialty paperboard and plastic
packaging. Revenues for the twelve month period ended Sept. 30,
2007 were $1.034 billion.
CHICAGO H&S: February 4 Deadline Set for Proofs of Claim Filing
---------------------------------------------------------------
The United States Bankruptcy Court for the Northern District of
Illinois set Feb. 4, 2008, as the final date for creditors of
Chicago H&S Hotel Property LLC to file proofs of claim.
The Court also established April 28, 2008, for governmental units
to file proofs of claim.
The Debtor said that it has yet to determine the nature, extend
and amount of the claims its creditors asserted against the
Debtor.
About Chicago H&S
Based in Chicago, Illinois, Chicago H&S Hotel Property, LLC, dba
Hotel 71, owns and operates a 40-story, 437 guestroom full service
hotel. The company filed for Chapter 11 protection on Oct. 29,
2007 (Bankr. N.D. Ill. Case No. 07-20088). Charles R. Gibbs, Esq.
at Akin Gump Strauus Hauer & Feld LLP, and Daniel A. Zazove, Esq.,
and Jason d. Horwitz, Esq., at Perkins Coie LLP, represent the
Debtor in its restructuring efforts. The Official Committee of
Unsecured Creditors in the Debtor's case chose Polsinelli Shalton
Flanigan Suelthaus P.C. as their counsel. The Debtor's schedules
reflected total assets of $133,553,529, and total liabilities of
$106,862,713.
CLASS V FUNDING: Poor Credit Quality Cues Moody's Rating Cuts
-------------------------------------------------------------
Moody's Investors Service downgraded ratings of six classes of
notes issued by Class V Funding III, Ltd., and left on review for
possible further downgrade ratings of two of these classes of
notes. The notes affected by this rating action are:
Class Description: $39,200,000 Class S Notes due 2015
-- Prior Rating: A3, on review for possible downgrade
-- Current Rating: B3, on review for possible downgrade
Class Description: $500,000,000 Class A1 Floating Rate Notes due
2052
-- Prior Rating: Baa1, on review for possible downgrade
-- Current Rating: Caa2, on review for possible downgrade
Class Description: $200,000,000 Class A2 Floating Rate Notes due
2052
-- Prior Rating: Baa2, on review for possible downgrade
-- Current Rating: Ca
Class Description: $120,000,000 Class A3 Floating Rate Notes due
2052
-- Prior Rating: Baa3, on review for possible downgrade
-- Current Rating: Ca
Class Description: $75,000,000 Class A4 Floating Rate Notes due
2052
-- Prior Rating: B2, on review for possible downgrade
-- Current Rating: Ca
Class Description: $50,000,000 Class B Deferrable Floating Rate
Notes due 2052
-- Prior Rating: Caa2, on review for possible downgrade
-- Current Rating: Ca
The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence on Nov. 13,
2007, as reported by the Trustee, of an event of default caused by
a failure of the Principal Coverage Ratio of Class A Notes to be
greater than or equal to the required amount pursuant Section
5.1(d) of the Indenture dated Feb. 28, 2007.
Class V Funding III, Ltd. is a collateralized debt obligation
backed primarily by a portfolio of CDO securities.
Recent ratings downgrades on the underlying portfolio caused
ratings-based haircuts to affect the calculation of
overcollateralization. Thus, the Principal Coverage Ratio of
Class A Notes failed to meet the required level.
As provided in Section 5.2 of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.
The rating downgrades taken reflect the increased expected loss
associated with each tranche. Losses are attributed to diminished
credit quality on the underlying portfolio. The severity of
losses of certain tranches may be different, however, depending on
the timing and choice of remedy to be pursued by certain
Noteholders. Because of this uncertainty, the ratings assigned to
Class S and to the Class A1 Notes remain on review for possible
further action.
COMSTOCK HOME: Has Until July 7 to Comply with Nasdaq Rules
-----------------------------------------------------------
Comstock Homebuilding Companies Inc. received notice from The
NASDAQ Stock Market stating that for 30 consecutive business days
the company's common stock has closed below the minimum
$1 per share requirement for continued inclusion under Marketplace
Rule 4450(a)(5).
The notice has no effect on the listing of the company's
securities at this time, and its common stock will continue to
trade on the NASDAQ Global Market under the symbol "CHCI."
In accordance with Marketplace Rule 4450(e)(2), the company has
180 calendar days, or until July 7, 2008, to regain compliance.
The notice states that if, at any time before July 7, 2008, the
bid price of the company's common stock closes at $1 per share or
more for a minimum of 10 consecutive business days, NASDAQ staff
will provide written notification that the company has achieved
compliance with the minimum bid price requirement. No assurance
can be given that the company will regain compliance during that
period.
If the company does not regain compliance with the minimum bid
price requirement by July 7, 2008, NASDAQ staff will provide the
company with written notification that its securities will be
delisted.
At that time, the company may appeal the delisting determination
to a Listings Qualifications Panel. Alternatively, the company may
apply to transfer its securities to the NASDAQ Capital Market if
it satisfies the requirements for initial inclusion set forth in
Marketplace Rule 4310(c), other than the minimum bid price
requirement of Marketplace Rule 4310(c)(4).
In the event of such a transfer, the company will be afforded an
additional 180 calendar days to comply with the minimum bid price
requirement while listed on the NASDAQ Capital Market. No
assurance can be given that the company will be eligible for the
additional 180-day compliance period, or, if applicable, that it
will regain compliance during any additional compliance period.
The company has not determined what action, if any, it will take
in response to this notice, although the companyintends to monitor
the closing bid price of its common stock between now and July 7,
2008, and to consider available options if its common stock does
not trade at a level likely to result in the company regaining
compliance with the NASDAQ minimum closing bid price requirement.
About Comstock Homebuilding
Based in Reston, Virginia, Comstock Homebuilding Companies Inc.
(Nasdaq: CHCI) -- http://www.comstockhomebuilding.com/-- is a
diversified real estate development firm with a focus on
moderately priced for-sale residential products. Established in
1985, Comstock builds and markets single-family homes, townhouses,
mid-rise condominiums, high-rise condominiums, mixed-use urban
communities and active adult communities. The companycurrently
markets its products under the Comstock Homes brand in the
Washington, D.C., Raleigh, North Carolina, and Atlanta, Georgia
metropolitan areas. Comstock develops mixed-use, urban
communities and active-adult communities under the Comstock
Communities brand.
* * *
On Oct. 25, 2007, the company entered into loan modification
agreements which extended maturities and provided for a
forbearance agreement with respect to all financial covenants. The
forbearance runs until March 31, 2008. As of Sept. 30, 2007, the
company had $11.1 million outstanding to M&T Bank, and is not in
compliance with the tangible net worth covenant.
CONSECO/GREEN TREE: Fitch Affirms Ratings on 54 Classes
-------------------------------------------------------
Fitch has downgraded 5 classes ($95.2 million), upgraded 11
classes ($174.6 million), and affirmed 54 classes ($387.2 million)
from the 70 Conseco/Green Tree Finance Home Equity and Home
Improvement transactions listed below. The outstanding rated
class balances total $457.0 million. Of the rated classes, 21
($159.8 million) have Distressed Recovery Ratings.
Green Tree Home Improvement 1996-C
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1996-C
-- Class HE M-2 affirmed at 'AAA';
-- Class HE B-1 affirmed at 'AA-';
-- Class HE B-2 affirmed at 'C/DR2'.
Green Tree Home Improvement 1996-D
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1996-D
-- Class HE M-2 affirmed at 'AAA';
-- Class HE B-1 affirmed at 'A+';
-- Class HE B-2 affirmed at 'CCC/DR1'.
Green Tree Home Improvement 1996-E
-- Certificate affirmed at 'C/DR5'.
Green Tree Home Improvement 1996-F
-- Class HI B-1 affirmed at 'AAA';
-- Class HI B-2 affirmed at 'CCC/DR2'.
Green Tree Home Equity 1996-F
-- Class HE B-1 affirmed at 'AA';
-- Class HE B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1997-B
-- Class M-2 affirmed at 'AAA';
-- Class B-1 upgraded to 'AA-' from 'A+';
-- Class B-2 affirmed at 'CCC/DR1'.
Green Tree Home Improvement 1997-C
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1997-C
-- Class HE M-2 affirmed at 'AAA';
-- Class HEB1 upgraded to 'AA-' from 'A+';
-- Class HEB2 affirmed at 'CCC/DR1'.
Green Tree Home Improvement 1997-D
-- Class HI B-1 affirmed at 'AAA';
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1997-D
-- Class HE M-2 affirmed at 'AAA';
-- Class HE B-1 upgraded to 'A+' from 'A-';
-- Class HE B-2 affirmed at 'CCC/DR1'.
Green Tree Home Improvement 1997-E
-- Class HI B-1 affirmed at 'AAA';
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1997-E
-- Class HE M-2 affirmed at 'AAA';
-- Class HE B-1 upgraded to 'A' from 'BBB+';
-- Class HE B-2 affirmed at 'CC/DR2'.
Green Tree Home Improvement 1998-B
-- Class HI B-1 upgraded to 'AA-' from 'A+';
-- Class HI B-2 affirmed at 'CCC/DR1'.
Green Tree Home Equity 1998-B
-- Class HE B-1 upgraded to 'AA-' from 'A+';
-- Class HE B-2 affirmed at 'CC/DR1'.
Green Tree Home Equity 1998-C
-- Class B-1 upgraded to 'AA-' from 'A+';
-- Class B-2 downgraded to 'CC/DR2 from 'CCC/DR1'.
Green Tree Home Equity 1999-C
-- Class M-2 affirmed at 'AAA';
-- Class B-1 upgraded to 'A+' from 'A';
-- Class B-2 downgraded to 'C/DR6' from C/DR2'.
Green Tree Home Equity 1999-D
-- Class M-1 affirmed at 'AAA';
-- Class M-2 upgraded to 'AA-' from 'A+';
-- Class B-1 affirmed at 'BB+';
-- Class B-2 downgraded to 'C/DR4' from 'CCC/DR1'.
Conseco Home Equity 2000-C
-- Class A affirmed at 'AAA';
-- Class M-1 affirmed at 'AA+';
-- Class M-2 affirmed at 'AA';
-- Class B-1 affirmed at 'A+'.
Conseco Home Improvement 2000-E
-- Class A-5 affirmed at 'AAA';
-- Class M-1 affirmed at 'AA-';
-- Class M-2 affirmed at 'BBB-';
-- Class B-1 affirmed at 'BB';
-- Class B-2 affirmed at 'CC/DR3'.
Conseco Home Equity 2001-B Group 1
-- Classes I-A-1A & I-A-5 affirmed at 'AAA';
-- Class I-M-1 affirmed at 'AA-';
-- Class I-M-2 affirmed at 'A+';
-- Class I-B-1 affirmed at 'BB+'.
Conseco Home Equity 2001-B Group 2
-- Class II-M-2 upgraded to 'AAA' from 'AA+';
-- Class II-B-1 upgraded to 'AA-' from 'A+'.
Conseco Home Equity 2001-B B2
-- Class B-2 downgraded to 'B+' from 'BB'.
Conseco Home Equity 2001-D
-- Class A-5 affirmed at 'AAA';
-- Class M-1 affirmed at 'AA';
-- Class M-2 affirmed at 'BBB';
-- Class B-1 downgraded to 'B' from 'BB-';
-- Class B-2 affirmed at 'CC/DR3'.
Conseco Home Equity 2002-B
-- Class A-3 affirmed at 'AAA';
-- Class M-1 affirmed at 'AA';
-- Class M-2 affirmed at 'A';
-- Class B-1 affirmed at 'BBB+';
-- Class B-2 affirmed at 'BB+'.
The downgrades are taken as a result of a deteriorating
relationship between credit enhancement and expected loss. In
addition, the B-2 classes in transactions prior to Conseco 2000-C
originally had the benefit of a Limited Guarantee provided by the
issuer. When Conseco filed for Chapter 11 bankruptcy protection
in December 2002, the guarantee was terminated. Because the
transactions were originally structured to include the Limited
Guarantee support, many of the B-2 classes have been unable to
maintain their original ratings.
The upgrades are taken as a result of a strengthening relationship
between credit enhancement and expected loss and the affirmations
are taken as a result of a stable relationship between credit
enhancement and expected loss.
The rating actions incorporate Fitch's analysis regarding loan
modification practices used by GreenTree Servicing on the
Conseco/Green Tree HE and HI portfolios. For borrowers who have
met certain criteria, the modifications primarily involve
deferring delinquent payments until the end of the loan term and
changing the borrower's payment status from delinquent to current.
Management indicated that the company has recently tightened up
the eligibility criteria for modifications. While Fitch believes
modifications can provide the benefit of maintaining cash flow on
a low-recovery asset and can potentially reduce cumulative losses
to the trust, Fitch assumes the loan modifications affect the
timing of losses by generally allowing for weaker borrowers to
remain in the loan pool longer and for a greater percentage of
defaults to be incurred later in the pool's life than would have
been incurred otherwise. As a result, Fitch amended the projected
default curve to account for the impact of the modifications to
the timing of losses.
The projected loss that Fitch expects on the remaining collateral
balances range from 5.1% to 20.1% for the HE portfolio and 3.8% to
18.9% for the HI portfolio. When added to cumulative losses to
date, which range between 3.7% (Conseco 2000-C) and 9.4% (Conseco
2001-B Group 2) for the HE portfolio and 3.7% (Green Tree 1997-D)
and 8.8% (Green Tree 1998-B) for the HI portfolio, the overall
losses that Fitch expects, as a percentage of the original
collateral balances, generally range from 5.0% to 12.4% for the HE
portfolio and 3.8% to 9.4% for the HI portfolio.
The collateral of the above transactions consists of fixed- and
adjustable-rate, closed-end mortgage loans secured by first or
second liens on one- to four-family residential properties. The
loans were originated by Green Tree Financial Corp. or Conseco
Finance Corp. Conseco 2001-B B2 is a resecuritization of the B-2
class from Conseco 2001-B with the additional benefit of a reserve
fund. The reserve fund was depleted in July 2004. All of the
above transactions are serviced by GreenTree Servicing, which is
rated 'RPS3+' by Fitch.
The pool factors of the above transactions range from 0.1% (Green
Tree 1996-E) to 17.7% (Conseco 2002-B). In addition, the
seasoning of the above transactions ranges from 49 months (Conseco
2002-B) to 119 months (Green Tree 1996-C).
COOKSON SPC: S&P Junks Rating on 2007-1LAC Notes
------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
notes issued by Cookson SPC's series 2007-1LAC and 2007-2LAC and
removed them from CreditWatch negative.
The rating actions reflect the Jan. 11, 2008, lowering of the
ratings on the class B floating-rate deferrable interest secured
notes due 2046 and the class C floating-rate deferrable interest
secured notes due 2046 issued by Lacerta ABS CDO 2006-1 Ltd. and
their removal from CreditWatch negative.
Cookson SPC series 2007-1LAC is a credit-linked note transaction
and the rating on the notes issued by the trust is based on the
lower of:
(i) the reference obligations, Lacerta ABS CDO 2006-1 Ltd.'s class
C floating-rate deferrable interest secured notes due 2046 ('CCC-
'); and
(ii) the rating on the swap counterparty, Citibank N.A. (AA/A-1+).
Cookson SPC series 2007-2LAC is a credit-linked note transaction
and the rating on the notes issued by the trust is based on the
lower of:
(i) the reference obligations, Lacerta ABS CDO 2006-1 Ltd.'s class
B floating-rate deferrable interest secured notes due 2046 ('BB-
'); and
(ii) the rating on the swap counterparty, Citibank N.A. (AA/A-1+).
Ratings Lowered; Removed From Creditwatch Negative
Cookson SPC series 2007-1LAC
EUR24 million series 2007-1LAC notes due 2046
Rating
------
Class To From
----- -- ----
Notes CCC- BBB/Watch Neg
Cookson SPC series 2007-2LAC
EUR10 million series 2007-2LAC notes due 2046
Rating
------
Class To From
----- -- ----
Notes BB- A/Watch Neg
CREDIT SUISSE: Moody's Affirms Junk Ratings on Two Classes
----------------------------------------------------------
Moody's Investors Service upgraded these ratings of six classes,
and affirmed these ratings of 10 classes of Credit Suisse First
Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 2001-CK1:
-- Class A-3, $494,907,181, affirmed at Aaa
-- Class A-X, Notional, affirmed at Aaa
-- Class A-Y, Notional, affirmed at Aaa
-- Class A-CP, Notional, affirmed at Aaa
-- Class B, $42,917,000, affirmed at Aaa
-- Class C, $45,441,000, upgraded to Aaa from Aa1
-- Class D, $12,621,000, upgraded to Aaa from Aa3
-- Class E, $12,623,000, upgraded to Aaa from A1
-- Class F, $20,196,000, upgraded Aa2 from A3
-- Class G, $17,672,000, upgraded to A2 from Baa2
-- Class H, $17,450,000, upgraded to Baa2 from Ba1
-- Class J, $27,421,000, affirmed at Ba2
-- Class K, $7,479,000, affirmed at Ba3
-- Class L, $7,478,000, affirmed at B2
-- Class M, $14,957,000, affirmed at Caa2
-- Class N, $4,986,000, affirmed at Caa3
As of the Dec. 18, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 26.3%
to $734.9 million from $997.1 million at securitization. The
Certificates are collateralized by 116 mortgage loans. The loans
range in size from less than 1.0% to 10.1% of the pool, with the
top 10 loans representing 30.7% of the pool. Thirty-nine loans,
representing 41.0% of the pool, have defeased and have been
replaced with U.S. Government securities. Six loans have been
liquidated, resulting in an aggregate realized loss of
approximately $3.7 million. Two loans, representing 4.0% of the
pool, are in special servicing. Moody's is estimating
$4.2 million of losses from all the specially serviced loans.
Twenty-nine loans, representing 27.8% of the pool, are on the
master servicer's watchlist.
Moody's was provided with calendar year 2006 operating results for
95.0% of the performing loans. Moody's loan to value ratio for
the conduit component is 81.3%, compared to 90.8% at Moody's last
full review in October 2006 and compared to 84.5% at
securitization. Moody's is upgrading Classes C, D, E, F, G and H
due to defeasance, loan pay downs and improved loan performance.
The top three conduit loans represent 16.6% of the outstanding
pool balance. The largest conduit loan is the Stonewood Center
Mall Loan ($74.0 million - 10.1%), which is secured by a 630,000
square foot portion of a 931,000 square foot regional mall located
approximately 13 miles southeast of Los Angeles, in Downey,
California. The mall is anchored by J.C. Penney, Macy's, Sears
and Mervyn's. As of June 2007 the mall was 98.6% leased, compared
to 98.8% at last review and compared to 94.0% at securitization.
The property has performed well and has benefited from
amortization. Full year 2006 NOI was 14% higher than for 2005.
Moody's LTV is 55.6%, compared to 64.1% at last review and
compared to 74.4% at securitization.
The second largest conduit loan is the Alliance IJ Portfolio Loan
($27.3 million - 3.7%), which is secured by four multifamily
properties located in Texas (3) and Indiana (1) with a total of
1,180 units. The loan was transferred to the special servicer in
August 2006 due to over $2 million in deferred maintenance at the
four properties. As of September 2007, occupancy ranged from 26%
to 51% with the weighted average of 39.3% compared to 43.0% at
last review and compared to 96.5% at securitization. The loan
matures in November 2011. Moody's currently estimates losses of
$3.8 million. Moody's LTV is in excess of 100.0%, as it was at
last review, compared to 87.4% at securitization.
The third largest conduit loan is the Brea Union Plaza Phase II
Loan ($20.9 million -- 2.8%), which is secured by a 175,000
square foot retail center located in Brea, California. Occupancy
as of June 2007 was 100.0%, the same as at securitization.
Performance has improved since securitization due to higher rent
and stable expenses. The largest tenants are Home Life, Nordstrom
Rack, and Staples; collectively, they occupy 61% of the space
through 2014. Moody's LTV is 76.7% compared to 77.0% at last
review and compared to 83.2% at securitization.
CWALT INC: Moody's Lowers Ratings on Nine Tranches to Low-B
-----------------------------------------------------------
Moody's Investors Service downgraded the ratings of twenty five
tranches and has placed under review for possible downgrade the
ratings of six tranches from eight transactions issued by
Countrywide in 2007. One downgraded tranche remains on review for
possible downgrade. The collateral backing these classes
primarily consists of first lien, adjustable-rate negatively
amortizing Alt-A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
CWALT, Inc.Mortgage Pass-Through Certificates, Series 2007-OA2
-- Cl. M-2 Currently Aa1, on review for possible downgrade,
-- Cl. M-3 Currently Aa1, on review for possible downgrade,
-- Cl. M-4 Currently Aa2, on review for possible downgrade,
-- Cl. M-5 Currently Aa3, on review for possible downgrade,
-- Cl. M-6, Downgraded to Ba2, previously A2,
-- Cl. M-7, Downgraded to Caa1, previously Baa2,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OA3
-- Cl. M-7, Downgraded to A2, previously A1,
-- Cl. M-8, Downgraded to Baa1, previously A2,
-- Cl. M-9, Downgraded to Baa3, previously A3,
-- Cl. M-10, Downgraded to Ba3, previously Baa3,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OA4
-- Cl. M-8, Downgraded to Baa2, previously Baa1,
-- Cl. M-9, Downgraded to Ba1, previously Baa3,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OA6
-- Cl. M-8, Downgraded to Baa1, previously A3,
-- Cl. M-9, Downgraded to Ba1, previously Baa2,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OA7
-- Cl. M-8, Downgraded to Baa1, previously A3,
-- Cl. M-9, Downgraded to Ba1, previously Baa1,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OA8
-- Cl. M-5 Currently Aa2, on review for possible downgrade,
-- Cl. M-6 Currently Aa3, on review for possible downgrade,
-- Cl. M-7, Downgraded to A2, previously A1,
-- Cl. M-8, Downgraded to Baa1, previously A2,
-- Cl. M-9, Downgraded to Baa2, previously A3,
-- Cl. M-10, Downgraded to B1, previously Baa3,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OH1
-- Cl. M-5, Downgraded to A3, previously A2,
-- Cl. M-6, Downgraded to Baa1, previously A3,
-- Cl. M-7, Downgraded to Baa2, previously Baa1,
-- Cl. M-8, Downgraded to Baa3, previously Baa1,
-- Cl. M-9, Downgraded to Ba2, previously Baa2,
-- Cl. B-1, Downgraded to B3 on review for possible further
downgrade, previously Ba2,
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-OH2
-- Cl. M-6, Downgraded to A3, previously A2,
-- Cl. M-7, Downgraded to Baa1, previously A3,
-- Cl. M-8, Downgraded to Ba1, previously Baa2.
CWALT INC: Moody's Reviews 10 Tranches' Ratings for Likely Cuts
---------------------------------------------------------------
Moody's Investors Service placed on review for possible downgrade
the ratings of ten tranches from CWALT, Inc. Mortgage Pass-Through
Certificates, Series 2007-AL1. The collateral backing the
securitization was originated by Alliance Bancorp and primarily
consists of first lien, adjustable-rate negatively amortizing
mortgage loans.
The rating was downgraded based on higher than anticipated rates
of delinquency, foreclosure, and REO in the underlying collateral
relative to credit enhancement levels. In its analysis Moody's
has also applied its published methodology updates to the non-
delinquent portion of the transactions.
Complete rating actions are:
CWALT, Inc. Mortgage Pass-Through Certificates, Series 2007-AL1
-- Cl. A-1 Currently Aaa, on review for possible downgrade,
-- Cl. A-2 Currently Aaa, on review for possible downgrade,
-- Cl. A-3 Currently Aaa, on review for possible downgrade,
-- Cl. X-P Currently Aaa, on review for possible downgrade,
-- Cl. M-1 Currently Aa1, on review for possible downgrade,
-- Cl. M-2 Currently Aa2, on review for possible downgrade,
-- Cl. M-3 Currently Aa3, on review for possible downgrade,
-- Cl. M-4 Currently A1, on review for possible downgrade,
-- Cl. M-5 Currently A3, on review for possible downgrade,
-- Cl. B-1 Currently Ba2, on review for possible downgrade.
CYGNAL TECHNOLOGIES: Amends Terms of Nov. 2007 DIP Facility Pact
----------------------------------------------------------------
Cygnal Technologies Corporation has entered into an agreement to
amend the DIP term sheet dated Nov. 14, 2007, between Cygnal,
Laurus Master Fund Ltd., Cygnal Technologies Ltd. and Accord
Communications Ltd.
Among other things, the agreement amends the DIP Term Sheet by
extending the maturity date of the facility to March 31, 2008,
subject to earlier termination upon an event of default or
implementation of a plan of arrangement in Cygnal's proceedings
under the Companies' Creditors Arrangement Act, and by extending
to March 17, 2008 the date by which Cygnal must obtain creditor
and court approval of a CCAA Plan.
About Cygnal Technologies
Based in Markham, Ontario, Cygnal Technologies Corporation
(TSX: CYN) -- http://www.cygnal.ca/-- provides network
communications solutions including the design, integration,
installation, maintenance and management of wired and wireless
solutions and networks. The company offers a full range of
technologies and solutions for service providers and enterprise
customers. Cygnal has expertise in voice, video and data
solutions over traditional and next generation converged
technologies. Cygnal supports end-user customers and business
partners through 12 offices across Canada, including Vancouver,
Edmonton, Calgary, Winnipeg, London, Burlington, Toronto, Ottawa,
Montreal, Quebec City and Halifax.
CYGNAL TECHNOLOGIES: Wants Further Extension of Stay Under CCAA
---------------------------------------------------------------
Cygnal Technologies Corporation said it expects to seek the
permission of the Ontario Superior Court of Justice to extend the
period of the Court-ordered stay of proceedings against Cygnal and
its wholly-owned subsidiaries, Cygnal Technologies Ltd. and Accord
Communications Ltd., and their property under the Companies'
Creditors Arrangement Act.
The period of the stay of proceedings currently ends on Jan. 31,
2008.
The purpose of the stay of proceedings is to provide the
applicants with relief designed to stabilize their operations and
business relationships with their customers, suppliers, employees,
and creditors and to provide the applicants with an opportunity to
develop a plan of arrangement to propose to creditors for the
restructuring of, among other things, some or all of the
applicants' liabilities. The applicants are continuing their
efforts to develop, with the input of their creditors and other
stakeholders, a comprehensive restructuring plan to return the
applicants to viability. The restructuring plan will likely
include strategic, operational, financial and corporate elements.
As part of this process, the Applicants are also preparing
a formal CCAA plan for creditor and court approval. The
opportunity for any recovery by holders of Cygnal's common shares
under any plan is uncertain and Cygnal's common shares may be
cancelled without any compensation pursuant to the plan.
About Cygnal Technologies
Based in Markham, Ontario, Cygnal Technologies Corporation
(TSX: CYN) -- http://www.cygnal.ca/-- provides network
communications solutions including the design, integration,
installation, maintenance and management of wired and wireless
solutions and networks. The company offers a full range of
technologies and solutions for service providers and enterprise
customers. Cygnal has expertise in voice, video and data
solutions over traditional and next generation converged
technologies. Cygnal supports end-user customers and business
partners through 12 offices across Canada, including Vancouver,
Edmonton, Calgary, Winnipeg, London, Burlington, Toronto, Ottawa,
Montreal, Quebec City and Halifax.
DELPHI CORP: Gets $44.2 Mil. Bearing Biz Bid from ND Acquisition
----------------------------------------------------------------
Delphi Automotive Systems LLC and Delphi Technologies, Inc.,
debtor-subsidiaries of Delphi Corp., intend to sell their global
bearings business to ND Acquisition Corp., or to another party
submitting a higher and better offer for the business.
ND Acquisition, a wholly owned subsidiary of private equity
investment firm Resilience Capital Partners LLC, has agreed to
submit a stalking horse bid of $44,200,000, subject to
adjustments, for the Bearings Business.
The Bearings Business produces both wheel bearings and roller
clutch product lines. It is the leading producer of Gen III
wheel bearings in North America and the primary North American
supplier of those parts to General Motors. The Bearings Business
occupies a 1.3-million square foot plant set on 133 acres in
Sandusky, Ohio.
The Debtors have invested more than $140,000,000 in new tooling
and refurbishment for older equipment and new state-of-the-art
machinery and equipment since 2000. The Bearings Business
employs approximately 1,000 people, including approximately 775
Hourly Employees. The hourly workforce is represented by the
International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America.
Marketing Efforts for Non-Core Businesses
As previously reported, to achieve the necessary cost savings and
operational effectiveness envisioned in its transformation plan,
Delphi is streamlining its product portfolio to capitalize on its
world-class technology and market strengths and make the
necessary manufacturing realignment consistent with its new
focus. As part of the company's transformation plan, the company
identified the Bearings Business as a non-core business subject
to disposition.
The Debtors believe that as a standalone business, the Bearings
Business could become more profitable and competitive, and thus,
have determined that the value of the Bearings Business would be
maximized through its divestiture, relates John Wm. Butler, Jr.,
Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago,
Illinois.
The Debtors, according to Mr. Butler, have actively marketed the
Bearings Business since February 2007. After evaluating
proposals submitted by potential buyers, the Debtors concluded
that ND Acquisition offered the most advantageous terms and the
greatest economic benefit.
Pursuant to a Sale and Purchase Agreement, entered into on
January 15, 2008, the Debtors have agreed to sell the Bearings
Business to ND Acquisition for $44,200,000, subject to certain
adjustments, and subject to higher or otherwise better offers.
Bidding Procedures
The Debtors will accept and consider competing bids for the
Bearings Business. The proposed Bidding Procedures provide, in
relevant part:
(a) Participation Requirements: To ensure that only bidders
with financial ability and a serious interest in the
purchase of the Acquired Assets participate in the Bidding
Process, the Bidding Procedures provide for certain
requirements for a potential bidder to become a "Qualified
Bidder", including the submission of certain financial
assurances.
(b) Due Diligence: All Qualified Bidders would be afforded an
opportunity to participate in the diligence process.
(c) Bid Deadline: All bids would have to be received not later
than 11:00 a.m. prevailing Eastern time, by February 11,
2008. The Debtors would provide the UAW with notice of
all Qualified Bidders and their contact information.
(d) Bid Requirements: All bids would be required to include
certain documents, including a good-faith deposit of
$750,000.
(e) Qualified Bids: To be deemed a "Qualified Bid," a bid
would be required to be received by the Bid Deadline and,
among other things, (i) be on terms and conditions that
are substantially similar to, and are not materially more
burdensome or conditional to the Debtors than, those
contained in the Agreement, (ii) have a value of the
Purchase Price plus the amount of the $1,500,000 Break-Up
Fee and the Expense Reimbursement, plus $500,000 in the
case of an initial Qualified Bid, plus $250,000 in the
case of any subsequent Qualified Bids over the immediately
preceding highest Qualified Bid.
(f) Conduct Of Auction: If the Debtors receive at least one
Qualified Bid in addition to that of ND Acquisition, they
would conduct an auction of the Acquired Assets at 10:00
a.m. (prevailing Eastern time) on February 13, 2008, or at
a later date.
(g) Selection Of Successful Bid: After the conclusion of the
Auction, the Debtors, in consultation with their advisors,
would review each Qualified Bid and identify the highest
or otherwise best offer for the Acquired Assets and the
bidder making the bid. The Debtors would sell the
Acquired Assets for the highest or otherwise best bid to
the Successful Bidder upon the approval of the
Court after the sale hearing.
(h) Sale Hearing: The Debtors request that the hearing to
consider the sale to ND Acquisition, or the winning
bidder, be scheduled for February 21, 2008, at 10:00 a.m.,
prevailing Eastern time. If the highest bidder fails to
consummate the sale for specified reasons, then the second
highest bid would be deemed to be the successful bid.
About Delphi Corp.
Headquartered in Troy, Michigan, Delphi Corporation (PINKSHEETS:
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 Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the
solicitation of votes on the First Amended Plan on Dec. 20,
2007. The Court will convene the hearing to consider
confirmation of the Plan on Jan. 17, 2008.
(Delphi Bankruptcy News, Issue No. 107; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELTA AIR: Commences Merger Negotiations with Northwest and UAL
---------------------------------------------------------------
Delta Air Lines Inc. obtained approval from its board of directors
on Jan. 11, 2007, to engage in formal merger talks with both
Northwest Airlines Corp. and UAL Corp., reports The Wall Street
Journal.
WSJ says Delta, which is in the early stages of discussions with
both Northwest and UAL, hopes to reach an agreement with one of
them over the next two weeks.
Delta is anticipating a deal announcement as early as mid-February
following Delta's board meeting scheduled early in the month, says
the report.
"A special committee of the board is working with management to
explore strategic options, including potential consolidation
transactions. However, we are not providing updates, while this
process is ongoing," Delta spokeswoman Betsy Talton, said.
Northwest and UAL declined to comment.
A UAL-Delta or a Northwest-Delta merger, which would likely be a
stock for stock transaction, would make Delta the largest airline
in the world, according to reports.
Experts in the airline industry, however, believe that a
Northwest-Delta merger is more likely as Delta's Chief Executive
Richard Anderson was previously CEO at Northwest, and is already
well acquainted with Northwest's operations.
Senator Johnny Isakson, a Georgia Republican, said that Mr.
Anderson told him in December that if there's a merger or an
acquisition, Delta would keep its name and Atlanta hub, Bloomberg
News reports.
About Delta Air
Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners. Delta flies to
Argentina, Australia and the United Kingdom, among others. The
company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts. Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice. John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors.
The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007. On
Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on
Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors'
disclosure statement. In April 25, 2007, the Court confirmed
the Debtors' plan. That plan became effective on
April 30, 2007. The Court entered a final decree closing 17
cases on Sept. 26, 2007.
As of Sept. 30, 2007, the company's balance sheet showed total
assets of $32.7 billion and total liabilities of $23 billion,
resulting in a $9.7 billion stockholders' equity. At Dec. 31,
2006, deficit was $13.5 billion.
(Delta Air Lines Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
* * *
As reported in yesterday's Troubled Company Reporter, according to
Standard and Poor's, media reports that Delta Air Lines Inc.
(B/Positive/--) entered into merger talks with UAL Corp.
(B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) has no
effect on its ratings or outlook on Delta, but that confirmed
merger negotiations would result in S&P's placing ratings of Delta
and other airlines involved on CreditWatch, most likely with
developing or negative implications.
EDGEWATER FOODS: Posts $913,315 Net Loss in 1st Qtr. Ended Nov. 30
------------------------------------------------------------------
Edgewater Foods International Inc. reported a net loss of $913,315
on revenue of $429,202 for the first quarter ended Nov. 30, 2007,
compared with a net loss of $3,105,123 on revenue of $123,187 in
the same period ended Nov. 30, 2006.
Gross loss for the three months ended Nov. 30, 2007, was $105,648,
as compared to gross loss of $67,882 for the three months ended
Nov. 30, 2006.
General and administrative expenses for the three months ended
Nov. 30, 2007, were $723,927. General and administrative expenses
were $175,931 for the three months ended Nov. 30, 2006. The
increase is directly attributable to stock compensation expense of
approximately $39,000 and stock option expense of roughly
$517,000.
For the three months ending Nov. 30, 2006, the company recognized
a loss of $2,768,477 which was related to the change in the fair
value of warrants issued to 10 institutional and accredited
investors in conjunction with preferred stock financings on
April 12, May 30, June 30, July 11, 2006, and Jan. 16, 2007, and
the market price of the common stock underlying such warrants. As
a result of reclassifying these warrant liabilities on Feb. 21,
2007, no such gain or loss was recorded for the period ended
Nov. 30, 2007.
At Nov. 30, 2007, the company's consolidated balance sheet showed
$7,391,008 in total assets, $1,853,055 in total liabilities, and
$5,537,953 in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Nov. 30, 2007, are available for
free at http://researcharchives.com/t/s?271c
Going Concern Doubt
LBB & Associates Ltd. LLP, in Houston, expressed substantial doubt
about Edgewater Foods International Inc.'s ability to continue as
a going concern after auditing the company's consolidated
financial statements for the year ended Aug. 31, 2007. The
auditing firm pointed to the company's absence of significant
revenues, recurring losses from operations, and its need
for additional financing in order to fund its projected loss in
2008.
About Edgewater Foods
Based in Qualicum Beach, B.C., Edgewater Foods International Inc.
(OTC BB: EDWT.OB) -- http://www.edgewaterfoods.com/-- is a Nevada
Corporation and is the parent company of Island Scallops Ltd., a
Vancouver Island aquaculture company. ISL was established in 1989
and for over 15 years has operated a scallop farming and marine
hatchery business.
FBR SECURITIZATION: Losses Cues S&P's Rating Cuts on 20 Classes
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 20
classes of mortgage pass-through certificates issued by FBR
Securitization Trust's series 2005-3 and 2005-4 and Specialty
Underwriting and Residential Finance Trust Series 2004-BC1. S&P
downgraded eight of the classes to speculative-grade from
investment-grade. Concurrently, S&P affirmed its ratings on all
remaining classes from the three transactions.
The lowered ratings reflect adverse collateral performance that
has caused monthly losses to exceed monthly excess interest. As
of the January 2008 remittance period, the cumulative losses, as a
percentage of the original pool balances, ranged from 1.31%
(Specialty Underwriting and Residential Finance Trust Series 2004-
BC1) to 1.92% (FBR Securitization Trust 2005-3). In all three
transactions, overcollateralization (O/C) was below its target.
The delinquency pipeline in many of the transactions strongly
suggests that the trend of monthly losses exceeding excess
interest will continue, further compromising credit support.
Severe delinquencies (90-plus days, foreclosures, and REOs) for
the downgraded transactions ranged from 11.62% (Specialty
Underwriting and Residential Finance Trust Series 2004-BC1) to
30.86% (FBR Securitization Trust 2005-3) of the current pool
balances. These deals are seasoned between 23 months (FBR
Securitization Trust 2005-4) and 44 months (Specialty Underwriting
and Residential Finance Trust Series 2004-BC1).
S&P affirmed its ratings on the remaining classes based on loss
coverage percentages that are sufficient to maintain the current
ratings despite the negative trends in the underlying collateral
of many of the deals.
Subordination, O/C, and excess spread provide credit support for
all of the affected deals. The collateral for these transactions
primarily consists of subprime adjustable- and fixed-rate mortgage
loans secured by first liens on one- to four-family residential
properties.
Ratings Lowered
FBR Securitization Trust
Mortgage-backed notes
Rating
------
Series Class To From
------ ----- -- ----
2005-3 M-1 AA- AA+
2005-3 M-2 BBB+ AA-
2005-3 M-3 BB BBB+
2005-3 M-4 BB- BB
2005-3 M-5 B+ BB
2005-3 M-6 B BB
2005-3 M-7 B- BBB
2005-3 M-8 CCC B
2005-4 M-2 A+ AA+
2005-4 M-3 BBB+ AA+
2005-4 M-4 BB AA
2005-4 M-5 BB AA
2005-4 M-6 B+ A+
2005-4 M-7 B BBB
2005-4 M-8 B- BB
2005-4 M-9 CCC BB
2005-4 M-10 CCC B
2005-4 M-11 CCC B
Specialty Underwriting and Residential Finance
Trust Series 2004-BC1
Mortgage loan asset-backed certificates
Rating
------
Class To From
----- -- ----
B-1 BB- BBB
B-2 CCC BBB-
Ratings Affirmed
FBR Securitization Trust
Mortgage-backed notes
Series Class Rating
------ ----- ------
2005-3 AV1, AV2-2, AV2-3 AAA
2005-3 AV2-4 AAA
2005-3 M-9 CCC
2005-3 M-10 CCC
2005-3 N-2 BBB-
2005-4 AV1, AV2-2, AV2-3 AAA
2005-4 AV2-4 AAA
2005-4 M-1 AA+
2005-4 M-12 CCC
Specialty Underwriting and Residential Finance
Trust Series 2004-BC1
Mortgage loan asset-backed certificates
Class Rating
----- ------
M-1 AA
M-2 A
M-3 A-
FREMONT INVESTMENT: S&P Confirms Mortgage Servicer Ranking
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its average subprime
mortgage servicer ranking on Fremont Investment & Loan and removed
it from CreditWatch with negative implications. The outlook is
stable.
These actions reflect discussions with company management since
the March 2007 CreditWatch placement regarding the status of
Fremont's operations. Although the company no longer originates
subprime mortgages, it will continue to service its existing
subprime loans until the portfolio is sold or runs off. Despite
the uncertainty of the mortgage company's business in 2007,
employee turnover levels have remained acceptable, and there have
been no considerable adverse affects on operations. Delinquencies
have risen significantly, but this may be attributed both to
market conditions and to the low credit quality of the remaining
loans in the portfolio. On Jan. 14, 2008, Fremont announced that
it had entered into a definitive agreement to sell the fixed
assets and assign its lease obligation of its Irving, Texas, loan
servicing facility. The company continues to maintain its
primary loan servicing operations in Ontario, Calif.
Outlook
The outlook is stable. Standard & Poor's will continue its
discussions with Fremont management about the future course of the
business, and we will monitor data submitted through Standard &
Poor's proprietary SEAM (Servicer Evaluation Analytical
Methodology) questionnaire to ensure continued
satisfactory performance. S&P will schedule a further review in
the second quarter of 2008, or sooner if the company's current
status changes. Standard & Poor's will continue to monitor
Fremont and will adjust S&P's ranking and outlook as necessary.
* * *
Fremont Investment and Loan continues to carry Standard and Poor's
'B' long term foreign and local issuer credit rating assinged on
May 22, 2007.
FIRST RC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: First RC Corp
2840 Highway 95 Alt., Suite #7
Silver Spring, NV 89429
Bankruptcy Case No.: 08-50054
Chapter 11 Petition Date: January 14, 2008
Court: District of Nevada (Reno)
Judge: Gregg W. Zive
Debtor's Counsel: Tory M. Pankopf, Esq.
Tory M. Pankopf Ltd.
611 Sierra Rose Drive
Reno, NV 89511
Tel: (530) 725-8263
Fax: (775) 831-1404
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor did not file a list of its 20 largest unsecured
creditors.
GENERAL MOTORS: Outlines Turnaround Progress and 2008 Priorities
----------------------------------------------------------------
General Motors Corp. Chairman and CEO Rick Wagoner and Vice
Chairman and CFO Fritz Henderson spoke to automotive analysts at a
GM conference on Jan. 17, 2008, giving detailed reviews of the
company's turnaround progress, outlining the automaker's
priorities for the year and providing a preview of improvement
opportunities for 2010 and beyond.
"We're delivering on the turnaround plan we established in 2005,
and have exceeded expectations on virtually all counts," Mr.
Wagoner said. "We've set a strong foundation that we can truly
build on. We're encouraged by our progress in revitalizing our
product portfolio, strengthening our brands, reducing structural
cost and growing the business globally. At the same time, it's
clear that we'll face some challenging headwinds in 2008.
"To continue driving the company's transformation, we'll remain
steadfast in our efforts to introduce great cars and trucks and
new advanced propulsion technologies, take full advantage of
growth markets around the world, and accelerate our efforts to
reduce structural costs to even more competitive levels in North
America," Mr. Wagoner added.
Turnaround Progress
Since introducing its North America turnaround plan in 2005, GM
has delivered significant progress in its massive restructuring,
including:
a) Product excellence
Dramatically improved vehicle design and performance is gaining
broad recognition, demonstrated by robust sales of recently
launched vehicles and numerous industry awards, including 2008
North America Car of the Year for the Chevrolet Malibu, 2008
Motor Trend Car of the Year for the Cadillac CTS, and 2007
North America Car and Truck of the Year awards for the Saturn
Aura and Chevrolet Silverado;
b) Revitalize the sales and marketing strategy
The company has fundamentally changed its "go to market"
approach, resulting in stronger brands, re-alignment of its
brand distribution channels, stabilized retail market share,
significant reductions in daily rental sales and higher average
transaction prices;
c) Intensify the focus on cost and quality
GM reduced annual structural cost in North America from 2005 to
2007 by $9 billion, driven by the 2005 hourly healthcare
agreement, revisions to U.S. salaried healthcare and pension
programs, capacity reduction actions, special attrition
programs for 34,000 hourly employees, and efficiencies achieved
in other activities. Significant improvements also continue to
be made in vehicle quality, as measured by both internal and
industry metrics;
d) Address healthcare/legacy cost burden
Reflecting the impact of historical agreements with the United
Auto Workers union and several other key initiatives, GM
anticipates that its spending on U.S. hourly and salaried
pension and healthcare will be reduced from an average of
$7 billion per year over the last 15 years, to approximately
$1 billion per year beginning in 2010.
Despite continued pressures in the German market, GM has also made
significant progress in its Europe operations, driven by strong
new products, successful implementation of its multi-brand
strategy, especially the rapid growth of the Chevrolet brand,
which contributed to record GME unit sales of over 2 million in
2007. Rapid expansion in Russia and Eastern Europe, and further
structural cost reductions have also contributed to the
improvements.
GM's total automotive results have demonstrated strong progress
since 2005, marked by significant improvements in both adjusted
net income and adjusted operating cash flow through the first
three quarters of 2007. GM continues to have strong liquidity,
with 2007 year-end gross liquidity estimated to be more than
$27 billion, up from $20.4 billion at year-end 2005.
2008 Outlook
Acknowledging headwinds facing the industry, including weak U.S.
auto industry sales volumes, high fuel prices, high commodity and
steel prices, and mounting regulatory requirements, Mr. Wagoner
outlined the following focus areas for 2008 designed to continue
the momentum and achieve improved financial results:
-- Continue to execute great products;
-- Build strong brands and distribution channels;
-- Execute additional cost reduction initiatives;
-- Take full advantage of growth in emerging markets;
-- Build GM's advanced propulsion leadership position; and
-- Maximize the benefits of running the business globally.
For 2008, GM projects global industry volume to reach a record
high of approximately 73 million units, up from about 71 million
in 2007, with growth in Asia Pacific, Latin America, Africa and
the Middle East and Europe. GM anticipates U.S. industry sales
will likely be in the low 16-million range, reflecting continuing
high fuel prices and sub-par consumer confidence. Despite
industry pressures, GM expects to increase revenues in all of its
regions, particularly in emerging markets.
Building on notable product successes including the Cadillac CTS,
Chevrolet Malibu, GMC Acadia, Saturn Outlook and Buick Enclave in
the U.S. and the Opel Corsa in Europe, GM will continue to
introduce a host of new products including the Pontiac G8 and
Chevrolet Traverse in the U.S. and Opel Insignia in Europe.
Capital spending is projected to be up slightly from 2007 levels
to about $8 billion in 2008.
On the sales and marketing front, GM will continue its efforts --
most clearly demonstrated in the recent launch of the Chevy Malibu
in the U.S. -- to more effectively integrate product and brand
marketing strategies. GM will accelerate the alignment of its
seven U.S. brands into four distinct dealer channels: Chevrolet,
Saturn, Buick/Pontiac/GMC and Cadillac/Hummer/SAAB. By doing this,
the company expects to enhance dealer profitability and over time
facilitate more highly differentiated products and brands.
With regard to cost competitiveness, GM has made major strides
toward achieving its global target of reducing automotive
structural costs to benchmark levels of 25% of revenue by 2010.
Structural costs are already below 30%, compared to 34% in 2005,
despite weaker than expected U.S. industry volumes. In light of
the progress already made, the company fully expects structural
costs as a percentage of revenue to be further reduced beyond
2010, with a target of 23% by 2012.
In support of those goals, the company plans to reduce annual U.S.
labor costs by an additional estimated $5 billion by 2011.
A significant portion of those reductions will be driven by the
implementation of the 2007 GM-UAW contract, including the
independent healthcare VEBA scheduled to begin in 2010, and in the
shorter term by taking full advantage of the workforce
restructuring opportunities included in the contract, including a
"non-core" wage and benefit structure which will result in the re-
classification of a significant number of jobs over time.
To facilitate these changes, GM launched, in cooperation with the
UAW, the first phase of a voluntary special attrition program for
hourly workers in January 2008. This phase applies to those at
select job banks, Service Parts Operations, and other key sites.
Employees participating in this phase will begin to exit in March.
GM disclosed that Phase 2 of the program, under active discussion
with the UAW, will be launched in February in all other plants.
Participating employees will begin exiting in April. For both
phases of the program, 46,000 existing employees are eligible for
retirement.
During the conference, GM also reiterated its strategy to achieve
manufacturing capacity utilization of 100%, or greater, in
countries with higher labor costs. Based on current U.S. industry
volume levels, additional capacity actions would be required in
vehicle assembly, stamping and powertrain facilities. The company
will continue to assess U.S. industry and product mix trends, and
what potential actions may be required over the coming months.
GM will continue its aggressive plans to grow in emerging markets
such as China, Brazil, Russia and India. To strengthen its
position in China, where it was the first automaker to sell
1 million units in a single year, GM intends to continue to build
its corporate reputation, expand its product portfolio with fuel-
efficient products, drive full implementation of its multi-brand
strategy, expand capacity, and develop our local supply base and
technology capability.
At GMAC Financial Services, while its mortgage business faces
continued challenges relating to weaknesses in the housing and
credit markets, its auto financing business remains profitable and
its insurance operations continue to perform well. GMAC expects
Residential Capital, LLC to meet its year-end 2007 financial
covenants, and GM believes GMAC remains adequately capitalized.
In addition, GMAC's liquidity position is at relatively high
historical levels and GMAC expects to be profitable in 2008, with
substantially reduced losses at ResCap due to risk mitigation
actions undertaken by the company.
Looking Ahead to 2010
Looking ahead, GM expects continued cost savings and improved
automotive pre-tax earnings by 2010, compared to 2007 levels,
driven by a number of factors.
The most significant savings is the estimated $4-5 billion GM
expects to gain in 2010 once it realizes the full-impact of the
2007 GM-UAW labor agreement related to the shift of U.S. hourly
health care to an independent VEBA, and takes advantage of
favorable labor demographics to adjust workforce levels and
transition a portion of the workforce to the new non-core wage
structure.
In addition, GM will reduce the cost premiums it has historically
paid to Delphi for systems, components and parts by approximately
$1 billion by 2010. Those savings will be offset by various labor
and transitional subsidies of $400-500 million under Delphi's
proposed reorganization, resulting in net savings of approximately
$500 million.
GM also sees the probability of a stronger U.S. industry in 2009
and beyond, as compared to the relatively low 16.5 million total
industry in 2007. All indications are that 16.5 million units are
approximately 1 million units below trend. It is estimated that a
move of the industry back to trend levels by 2010 would generate
additional pre-tax income to GM in the range of approximately
$1 billion to $1.5 billion annually.
Beyond these factors, there are a number of additional
opportunities to further improve GM earnings and cash flow by
2010, though they are more difficult to predict with specificity.
These include: additional material cost reductions due to
continued leveraging of global vehicle architectures, improved
pricing driven by compelling designs and stronger brands,
continued explosive growth in revenue and profitability in
emerging markets, and improved performance at GMAC.
At the same time, continued U.S. industry product mix
deterioration, regulatory cost increases and the ongoing
competitiveness of the marketplace pose potential risks to GM's
profitability.
Considering the foregoing, GM management expects to significantly
improve operating results, including earnings and cash flow, over
the next two to three years.
About GM
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 280,000 people around the world and manufactures cars and
trucks in 33 countries, including the United Kingdom, Germany,
France, Russia, Brazil and India. In 2006, nearly 9.1 million GM
cars and trucks were sold globally under the following brands:
Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
* * *
As reported in the Troubled Company Reporter on Nov. 9, 2007,
Moody's Investors Service affirmed its rating for General Motors
Corporation (B3 Corporate Family Rating, Ba3 senior secured, Caa1
senior unsecured and SGL-1 Speculative Grade Liquidity rating) but
changed the outlook to Stable from Positive. In an environment of
weakening prospects for US auto sales GM has announced that it
will take a non-cash charge of $39 billion for the third quarter
of 2007 related to establishing a valuation allowance against its
deferred tax assets (DTAs) in the US, Canada and Germany.
As reported in the Troubled Company Reporter on Oct. 23, 2007,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on General Motors Corp. and
removed them from CreditWatch with positive implications, where
they were placed Sept. 26, 2007, following agreement on the new
labor contract. The outlook is stable.
GENESIS PHARMACEUTICALS: Sherb & Co. Raises Going Concern Doubt
---------------------------------------------------------------
Sherb & Co., LLP, in Boca Raton, Fla., expressed substantial doubt
about the ability of Genesis Pharmaceuticals Enterprises, Inc. to
continue as a going concern after it audited the company's
financial statements for the year ended Sept. 30, 2007. The
auditing firm pointed to the company's accumulated deficit and net
loss for the year ended Sept. 30, 2007.
The company posted a net loss of $5,820,584 on net revenues of
$3,035,000 for the year ended Sept. 30, 2007, compared with a net
income of $2,909,606 on net revenues of $6,750,229 in the prior
year.
As of Sept. 30, 2007, the company has total current assets of
$945,900 to pay its total current liabilities of $2,052,324.
At Sept. 30, 2007, the company's balance sheet showed $5,949,792
in total assets, $2,173,387 in total liabilities, and a
stockholders' equity of $3,776,405.
A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?2717
About Genesis Pharmaceuticals
Genesis Pharmaceutical Enterprises (OTC BB:GTEC.OB), formerly
Genesis Technology Group, operates primarily through subsidiary
Laiyang Jiangbo, a China-based contract pharmaceutical
manufacturer. Genesis Technology became Genesis Pharmaceutical in
October 2007 in conjunction with a reverse merger in which the
controlling shareholders of Laiyang Jiangbo wound up with a 75%
stake in the new company.
GLOBAL CREDIT: S&P Places BB- Rating Under Negative Watch
---------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on the issue
of Global Credit Pref Corp.'s preferred shares on CreditWatch with
negative implications. The CreditWatch placement mirrors the
CreditWatch action on the credit-linked note to which the issue of
preferred shares is linked.
Standard & Poor's will continue to monitor the underlying
portfolio and expects to resolve the CreditWatch placement within
a period of 90 days and update its opinion.
Global Credit Pref Corp.
Ratings Placed On CreditWatch Negative
Preferred shares
To From
-- ----
Global scale: BB-/Watch Neg BB-
Canadian scale: P-3(Low)/Watch Neg P-3(Low)
(Related CLN: The Toronto-Dominion Bank CDN$48,031,000
Portfolio Credit Linked Notes)
GRAFTECH INTL: S&P Ratings Unmoved by $125MM Notes' Redemption
--------------------------------------------------------------
Standard & Poor Ratings Services said that its rating and outlook
on graphite electrodes manufacturer Graftech International Ltd.
(B+/Positive/--) are not affected at this time by the company's
announcement that it will redeem $125 million of its outstanding
10.25% senior notes due 2012.
The company expects to carry out the optional redemption on or
about Feb. 15, 2008. It will be funded through the combination of
cash flow from operations and other financing activities. Upon
completion of the planned redemption, $75 million in principal
amount of the senior notes will be outstanding.
While the expected debt reduction further strengthens the
company's consolidated financial profile, S&P remains concerned
about rising raw material costs, needle coke supply, and cyclical
swings in demand.
GREENPOINT MORTGAGE: Moody's Downgrades Ratings on 11 Tranches
--------------------------------------------------------------
Moody's Investors Service downgraded the ratings of eleven
tranches from three transactions issued by GreenPoint Mortgage
Funding Trust in 2007. The collateral backing these classes
primarily consists of first lien, adjustable-rate negatively
amortizing Alt-A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
GreenPoint Mortgage Funding Trust 2007-AR1
-- Cl. M8-I, Downgraded to Baa2, previously Baa1,
-- Cl. M9-I, Downgraded to Baa3, previously Baa2,
-- Cl. M9-II, Downgraded to Ba1, previously Baa3,
Greenpoint Mortgage Funding Trust 2007-AR2
-- Cl. 1-M5, Downgraded to A2, previously A1,
-- Cl. 1-M6, Downgraded to Baa1, previously A2,
-- Cl. 1-M7, Downgraded to Baa2, previously A3,
-- Cl. 1-M8, Downgraded to Baa3, previously Baa1,
-- Cl. 1-M9, Downgraded to Ba1, previously Baa2,
-- Cl. 2-M9, Downgraded to Ba1, previously Baa3,
Greenpoint Mortgage Funding Trust 2007-AR3
-- Cl. M7, Downgraded to Baa2, previously Baa1,
-- Cl. M8, Downgraded to Ba1, previously Baa3.
GREENWICH CAPITAL: Stable Performance Cues Fitch to Hold Ratings
----------------------------------------------------------------
Fitch Ratings affirms Greenwich Capital Commercial Mortgage
Trust's mortgage pass-through certificates, series 2002-C1 as:
-- $38.2 million class A-2 at 'AAA';
-- $91 million class A-3 at 'AAA';
-- $608.2 million class A-4 at 'AAA';
-- Interest-only class XPB at 'AAA';
-- Interest-only class XP at 'AAA';
-- Interest-only class XC at 'AAA';
-- $46.5 million class B at 'AAA';
-- $11.6 million class C at 'AAA';
-- $14.5 million class D at 'AAA';
-- $20.4 million class E at 'AAA';
-- $16 million class F at 'AAA';
-- $16 million class G at 'AAA';
-- $17.4 million class H at 'AA+';
-- $14.5 million class J at 'AA-';
-- $20.4 million class K at 'A';
-- $20.4 million class L at 'BBB+';
-- $8.7 million class M at 'BBB';
-- $5.8 million class N at 'BBB-';
-- $8.7 million class O at 'B+';
-- $4.4 million class P at 'B'.
Fitch does not rate the $22.4 million class Q. Classes A-1 and
the non-rated class SWD-B are paid in full.
The ratings affirmations are the result of continued stable
performance. As of the December 2007 distribution date, the
pool's aggregate certificate balance has decreased 16.4%, to
$985.1 million from $1.2 billion at issuance. To date, 19 loans
(25.4%) have defeased, including three (15.1%) of the top 10 loans
in the pool.
There is currently one specially serviced asset (0.6%), which is
secured by a mixed-use property located in Kingwood, Texas. The
loan remains current under a forbearance agreement and no losses
are anticipated.
GSC INVESTMENT: S&P Puts Preliminary BB Rating on $22MM Notes
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to GSC Investment Corp. CLO 2007 Ltd./GSC Investment Corp.
CLO 2007 Inc.'s $370 million floating-rate notes due 2020.
The preliminary ratings are based on information as of Jan. 16,
2008. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect:
-- The expected commensurate level of credit support in the
form of subordination to be provided by the notes junior
to the respective classes;
-- The cash flow structure, which was subjected to various
stresses requested by Standard & Poor's;
-- The collateral manager's experience; and
-- The transaction's legal structure, which includes the
issuer's bankruptcy remoteness.
Preliminary Ratings Assigned
GSC Investment Corp. CLO 2007 Ltd./GSC
Investment Corp. CLO 2007 Inc.
Class Rating Amount (million)
----- ------ ----------------
A AAA $296
B AA $22
C A $14
D BBB $16
E BB $22
Subordinated notes NR $30
NR - "Not rated.
HANOVER INSURANCE: Moody's Reviews Ba1 Rating for Possible Cut
--------------------------------------------------------------
Moody's Investors Service placed the Ba1 senior debt rating of The
Hanover Insurance Group, Inc. and the Baa1 insurance financial
strength rating of its subsidiary, Hanover Insurance Company, on
review for possible upgrade. The decision to review the ratings
for possible upgrade reflects a continuation of favorable trends
which have become clearer over the past year, particularly as they
relate to risk-adjusted capitalization and business flow. The Ba1
insurance financial strength rating and stable outlook on the run-
off life insurance subsidiary, First Allmerica Financial Life
Insurance Co., remain unaffected by this rating action.
The review for upgrade will focus on the company's plans for
capital management activities (including additional acquisitions)
and financial leverage. These items carry particular importance
given the company's geographic concentration in a limited number
of states. These states have been historically challenging for
insurers and/or are vulnerable to natural catastrophes. In
particular, Michigan, Massachusetts, New York, New Jersey,
Louisiana and Florida make up the company's top six states and
represent over 70% of total direct written premiums. The review
will also focus on the company's immediate plans in Massachusetts,
where regulators will soon allow auto insurers to establish their
own rates, subject to certain conditions and regulatory approval.
In the short term, Moody's expects continued strengthening of
risk-adjusted capitalization (as measured in part by gross
underwriting leverage below 3.2 times), overall combined ratios in
the high 90's assuming a normal level of catastrophe losses,
positive business flow from agents, a ratio of holding company
cash and invested assets to total debt greater than 40%, and
prudent capital management.
The last rating action on The Hanover Insurance Group, Inc.
occurred on Dec. 7, 2006 when Moody's changed the rating outlook
to positive from stable.
These ratings were placed on review for possible upgrade:
The Hanover Insurance Group, Inc.
-- senior unsecured debt rating at Ba1; commercial paper
rating at NP (Not Prime);
-- AFC Capital Trust I: preferred stock rating at Ba2;
Hanover Insurance Co.
-- insurance financial strength at Baa1.
This rating was affirmed with a stable outlook:
First Allmerica Financial Life Insurance Co.
-- insurance financial strength at Ba1.
The Hanover Insurance Group, formerly Allmerica Financial
Corporation, is a holding company for its insurance subsidiaries,
which collectively rank among the top 35 property and casualty
insurers in the United States. THG operates as The Hanover
Insurance Company, except in Michigan and other Midwest states
where it does business as Citizens Insurance Company of America.
It offers a range of property and casualty insurance products to
individuals and business owners through its network of over 2,000
independent agents. For the first nine months of 2007, THG
reported net premiums written of $1.9 billion and net income of
$177 million. As of Sept. 30, 2007, shareholders' equity was $2.2
billion.
HARBORVIEW MORTGAGE: Moody's Downgrades Ratings on 18 Tranches
--------------------------------------------------------------
Moody's Investors Service downgraded the ratings of eighteen
tranches and has placed under review for possible downgrade the
ratings of two tranches from five transactions issued by
HarborView Mortgage Loan Trust 2007. The collateral backing these
classes primarily consists of first lien, adjustable-rate
negatively amortizing Alt-A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
HarborView Mortgage Loan Trust 2007-1
-- Cl. B-7, Downgraded to A3, previously A2,
-- Cl. B-8, Downgraded to Baa3, previously Baa1,
HarborView Mortgage Loan Trust 2007-2
-- Cl. B-3 Currently Aa3, on review for possible downgrade,
-- Cl. B-4 Currently Aa3, on review for possible downgrade,
-- Cl. B-5, Downgraded to A3, previously A1,
-- Cl. B-6, Downgraded to Baa2, previously A2,
-- Cl. B-7, Downgraded to Ba3, previously Baa1,
-- Cl. B-8, Downgraded to B3, previously Baa2,
HarborView Mortgage Loan Trust 2007-3
-- Cl. B-6, Downgraded to A3, previously A2,
-- Cl. B-7, Downgraded to Baa1, previously A3,
-- Cl. B-8, Downgraded to Baa3, previously Baa2,
-- Cl. B-9, Downgraded to Ba2, previously Ba1,
HarborView Mortgage Loan Trust 2007-4
-- Cl. B-5, Downgraded to Baa1, previously A3,
-- Cl. B-6, Downgraded to Baa3, previously Baa2,
-- Cl. B-7, Downgraded to Ba2, previously Baa3,
-- Cl. B-8, Downgraded to B1, previously Ba2,
HarborView Mortgage Loan Trust 2007-5
-- Cl. B-5, Downgraded to A2, previously A1,
-- Cl. B-6, Downgraded to Baa1, previously A3,
-- Cl. B-7, Downgraded to Baa3, previously Baa1,
-- Cl. B-8, Downgraded to Ba2, previously Baa3.
HAVEN HEALTHCARE: Committee Hires Pepper Hamilton as Counsel
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Haven Healthcare
Management LLC and its debtor-affiliates' bankruptcy cases
obtained authority from the United States Bankruptcy Court for the
District of Connecticut to employ Pepper Hamilton LLP as their
attorneys.
Pepper Hamilton is expected to:
a) advise the Committee with respect to its rights, duties and
powers in these cases;
b) assist and advise the Committee in its consultations with
the Debtors relating to the administration of these cases;
c) assist the Committee in analyzing the claims of the Debtors'
creditors and the Debtors' capital structure and in
negotiating with the holders of claims and, if appropriate,
equity interests;
d) assist the Committee's investigation of the acts, conduct,
assets, liabilities and financial condition of the Debtors
and other parties involved with the Debtors, and of the
operation of the Debtors businesses;
e) assist the Committee in analyzing intercompany transactions;
f) assist the Committee in its analysis of, and negotiations
with the Debtors or any other third party concerning matters
related to, among others things, executory contracts, asset
dispostions, financing of other transactions and the terms
of a plan of reorganization for the Debtors and accompanying
disclosure statement and related plan documents;
g) assist and advise the Committee as to its communications, if
any, to the general creditor body regarding significant
matters in these cases;
h) represent the Committee at all hearings and other
proceedings;
i) review, analyze, and advise the Committee with respect to
all applications, orders, statements of operations and
schedules filed with the Court;
j) assist the Committee in preparing pleadings and applications
as may be necessary in furtherance of the Committee's
interestsa and objectives; and
k) perfom other services as may be required and are deemed to
be in the interest of the Committee in accordance with the
Committee's powers and duties as set forth in the Bankruptcy
Code.
The firm's professionals and their compensation rates are:
Designation Hourly Rate
----------- -----------
Partners $335 - $750
Associates $200 - $425
Paraprofessionals $35 - $250
Robert S. Hertzberg, Esq., a partner of the firm, assures the
Court that the firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
Headquartered in Middletown, Connecticut, Haven Healthcare
Management LLC -- http://www.havenhealthcare.com/-- provide
nursing care to the elderly in New England, Connecticut. The
company operates health centers and assisted living facilities.
In addition, the company specializes in short-term rehabilitative
care and long-term care. The company and 46 of its affiliates
filed for Chapter 11 protection on November 22, 2007 (Bankr. D.
Conn. Lead Case No. 07-32719). Moses and Singer LLP is the
Debtors' proposed counsel. The Debtor selects Kurtzman Carson
Consultants LLC as claims and noticing agent. The U.S. Trustee
for Region 2 appointed nine creditors to serve on an Official
Committee of Unsecured Creditors in this cases. When the Debtors
filed for protection against their creditors, it listed assets and
debt between $1 Million to $100 Million. The Debtors'
consolidated list of their 50 largest unsecured creditors showed
total claims of more than $20 million.
HEARTLAND AUTO: Gets Initial OK to Use Lenders' Cash Collateral
---------------------------------------------------------------
The United States Bankruptcy Court for the Northern District of
Texas granted Heartland Automotive Holdings Inc. and its debtor-
affiliates access, on an interim basis, to several secured
lenders' cash collateral, until Jan. 23, 2008.
The Debtors tell the Court that the cash collateral is required
to fund their operations and preserve the value of their assets as
a going concern. Specifically,the Debtors point out, the cash
collateral will also be used to fund payroll and other operating
needs, including the costs of administration of their chapter 11
cases.
As adequate protection, the Debtors granted the secured lenders:
i) continuing maintenance and preservation of the prepetition
collateral for the benefit of the secured lenders; and
ii) postpetition replacement liens and security interests in
all property of the Debtors.
A final hearing has been set on Jan. 23, 2008, at 3:00 p.m., at
the Hon. D. Michael Lynn's courtroom in Fort Worth.
Based in Omaha, Nebraska, Heartland Automotive Holdings, Inc. --
http://www.heartlandjiffylube.com/-- operates quick-oil-change
stores in the U.S. The company and its nine affiliates filed for
Chapter 11 protection on Jan. 7, 2008 (Bank. N.D. Tex. Case No.
08-40057). Jeff P. Prostok, Esq., at Forshey & Prostok, L.L.P.
represents the Debtors in their restructuring efforts. The U.S.
Trustee for Region 6 has not appointed creditors to serve on an
Official Committee of Unsecred creditors in this case. When the
Debtor files for protection from their creditors its listed
estimated assets and debts between $100 million and $500 million.
As reported in the Troubled Company Reporter on Jan. 16, 2008,
the Debtors ask the Court's permission to secure a $10 million
postpetition financing from an affiliate of Quad-C Partners VI,
LP.
HOVNANIAN ENT: S&P Cuts Preferred Stock's Rating to D from CCC+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Hovnanian
Enterprises Inc.'s preferred stock to 'D' from 'CCC+'. At the
same time, S&P placed its corporate credit, senior unsecured, and
senior subordinated debt ratings on Hovnanian on CreditWatch with
negative implications.
The downgrade of Hovnanian's preferred stock follows the company's
nonpayment of the scheduled quarterly dividend on its $140 million
series A preferred stock, which was due Jan. 15, 2008. As
expected, the company did not make the payment because a bond
covenant governing Hovnanian's unsecured notes restricts dividend
payments if fixed-charge coverage falls below 2.0x. Hovnanian's
fixed-charge coverage was below the 2.0x covenant minimum for the
12 months ended Oct. 31, 2007, and the January dividend payment
was restricted.
Dividends on the series A preferred stock are not cumulative,
which means holders will not have the right to receive unpaid
dividends. Holders of the series A preferred stock generally do
not have voting rights. However, if Hovnanian does not pay
dividends on the series A preferred stock in an aggregate amount
equal to at least six full quarterly dividend payments
(whether or not consecutive), holders of the series A preferred
stock and any such other class or series of preferred stock
(voting as a single class) will be entitled to nominate two
persons as advisory directors to attend, but not vote at, certain
board of directors meetings until full dividends have been paid
for at least four consecutive quarterly dividend periods. In
addition, certain materially adverse changes to the terms of the
series A preferred stock cannot be made without the affirmative
vote by holders of at least a majority of the shares of series A
preferred stock.
Hovnanian was granted a temporary waiver from its bank lenders
after it violated its tangible net worth and leverage covenants in
its fourth quarter ended Oct. 31, 2007. S&P has placed all other
Hovnanian-related ratings on CreditWatch pending the completion of
the company's negotiations with its bank group to amend its credit
facility and receive adequate covenant relief to operate through
this housing cycle. These ratings will also remain on CreditWatch
pending future meeting with management to review its plan for
2008. The resolution of the CreditWatch placements hinges on a
review of Hovnanian's strategies and the company's capacity to
reduce inventory,
generate cash, and reduce debt in the coming year.
Rating Lowered
Hovnanian Enterprises Inc.
To From
-- ----
Preferred stock D CCC+
Ratings Placed on CreditWatch Negative
Hovnanian Enterprises Inc.
To From
-- ----
Corporate credit B+/Watch Neg/-- B+/Negative/--
Senior unsecured B+/Watch Neg/ B+
Senior subordinated B-/Watch Neg/ B-
IKONA GEAR: Nov. 30 Balance Sheet Upside-Down by $51,380
--------------------------------------------------------
Ikona Gear International Inc.'s consolidated balance sheet at
Nov. 30, 2007, showed $1.79 million in total assets and
$1.84 million in total liabilities, resulting in a $51,380 total
stockholders' deficit.
At Nov. 30, 2007, the company's consolidated balance sheet also
showed strained liquidity with $1.49 million in total current
assets available to pay $1.83 million in total current
liabilities.
The company reported a net loss of $704,127 on total revenue of
$703,060 for the first quarter ended Nov. 30, 2007, compared with
a net loss of $706,111 on total revenue of $111,377 for the same
period ended Nov. 30, 2006.
The increase in revenue reflects an increase in delivery of
drawworks and oil and gas equipment.
Full-text copies of the company's consolidated financial
statements for the quarter ended Nov. 30, 2007, are available for
free at http://researcharchives.com/t/s?271a
About Ikona Gear
Based in Coquitlam, British Columbia, Canada, Ikona Gear
Internationald Inc. (OTC BB: IKGIE) -- http://www.ikonagear.com/-
- is a custom designer of gearing applications. The company
provides gear design and mechanical design services to product
manufacturers who would like exclusive rights to incorporate the
company's gearing technology into their products.
INDUSTRIAL DEV'T: Fitch Cuts Rating on Series 1997A Bonds to B+
---------------------------------------------------------------
Fitch Ratings has downgraded the Industrial Development Authority
of the County of Henrico, Virginia Solid Waste Disposal revenue
bonds (Browning-Ferris Industries of South Atlantic, Inc. Project)
series 1997A to 'B+' from 'A-'.
The 'B+' rating reflects the Issuer Default Rating of the
guarantor, Browning-Ferris Industries. The rating on the
Browning-Ferris Industries of South Atlantic, Inc. Project,
series 1997A bonds is withdrawn.
ING RE (UK): Chap. 15 Petition Hearing Set for January 30
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing at 9:30 a.m. on Jan. 30, 2008, to consider
the Chapter 15 petition filed on Jan. 4, 2008 by Michael Larry
Emerson as foreign representative of I.N.G. Re (U.K.), Ltd.
Interested parties have until 4:00 p.m., New York time on Jan. 23,
2008, to file their responses or objections to the petition.
Lawyers at Clifford Chance U.S., L.L.P. in New York City represent
the Foreign Representative in this case.
About ING Re (U.K.), Ltd.
ING Re (U.K.), Ltd. -- http://www.ing-re.co.uk/-- provided
accident and health reinsurance services and was also engaged in
the retrocession business in the U.K. since 1997.
ING Re (U.K.), Ltd. ceased its business and went into run-off in
2002. However, since it expected the run-off of its business to
continue for a number of years, it had proposed a solvent scheme
of arrangement under Section 425 of the U.K. Companies Act of 1985
as the most efficient and effective method of making full payment
to its creditors in the shortest practical time.
On Sept. 21, 2007, the ING Re (U.K.), Ltd. sought permission
from the High Court of Justice of England and Wales in the U.K. to
convene a meeting with the creditors to allow them to vote on the
Scheme of Arrangement. On Oct. 31, 2007, the court gave the
sought permission. On Dec. 19, 2007, the meeting between the ING
Re (U.K.), Ltd. and the creditors was convened.
INPHONIC INC: Wants Court to Set February 28 as Claims Bar Date
---------------------------------------------------------------
InPhonic Inc. and its debtor-affiliates ask the United States
Bankruptcy Court for the District of Delaware to establish
Feb. 28, 2008, as deadline for creditors to file proofs of claims.
The Debtors also propose May 6, 2008, as last date for
governmental units.
The Debtors tell the Court that they need sufficient time to
inform all known entities that may hold claims against the
Debtors.
A hearing has been set on Jan. 30, 2008, at 3:00 p.m., to consider
approval of the Debtors' request. Objection to approval must be
filed before Jan. 23, 2008.
Headquartered in Washington, DC, InPhonic Inc. (NASDAQ:INPC)--
http://www.inphonic.com/-- is an online seller of wireless
services in the United States. The company operates its business
through three business segments: wireless activation and services;
mobile virtual network enabler services, and data services.
The company and its debtor-affiliates filed for Chapter 11
protection on Nov. 8, 2007 (Bankr. D. Del. Case Nos. 07-11666 to
07-11673). Mary E. Augustine, Esq., and Neil B. Glassman, Esq.,
at The Bayard Firm, in Wilmington, Delaware, represent the
Debtors. The Debtors selected BMC Group Inc. as their claims,
noticing and balloting agent. The United States Trustee for
Region 3 appointed five creditors to serve on an Official
Committee of Unsecured Creditors in the Debtors' cases.
When the Debtors filed from protection from their creditors,
they listed total assets of $120,916,991 and total debts of
$179,402,834.
IWT TESORO: Withdraws Exclusive Periods Extension Plea
------------------------------------------------------
IWT Tesoro Corporation and its debtor-affiliates has withdrawn,
without prejudice, their request to further extend their exclusive
periods.
Paper filed with the United States Bankruptcy Court for the
Southern District of New York did not cite any reasons why the
request was withdrawn.
As reported in the Troubled Company Reporter on Jan. 2, 2008,
the Debtors ask the Court to further extend their exclusive period
to file a plan for 120 days, and solicit acceptances of that plan
for 180 days. The Debtors told the Court that they need
sufficient time to formulate a consensual Chapter 11 plan of
reorganization as they continue their negotiations with their
proposed funder, KMA Capital, and the Official Committee of
Unsecured Creditors.
I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, --
http://www.iwttesoro.com/-- is headquartered in New York City.
The company and its subsidiaries distribute building materials,
specifically hard floor and wall coverings. They are
wholesalers and do not sell directly to any end user. Their
products consist of ceramic, porcelain and natural stone floor,
wall and decorative tile. They import a majority of these
products from suppliers and manufacturers in Europe, South
America (Brazil), and the Near and Far East. Their markets
include the United States and Canada. They also offer private
label programs for branded retail sales customers, buying
groups, large homebuilders and home center store chains.
The Debtor and its debtor-affiliates, International Wholesale
Tile, Inc. and American Gres, Inc., filed for Chapter 11
bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case
No. 07-12841). John K. Sherwood, Esq., at Lowenstein Sandler
P.C., represents the Official Committee of Unsecured Creditors.
As of June 30, 2007, the Debtors had total assets of $39,798,579
and total debts of $47,940,983.
JOHN CHEZIK: Punitive Damages Double Initial Verdict of $8.4 Mil.
-----------------------------------------------------------------
Bankrupt John Chezik Homerun Inc. and its parent company, A&L
Holding Co.'s judgment in a class action suit has doubled from
$8.4 million after accounting for professional fees, Dan Margilies
writes for The Kansas City Star.
The Hon. Rex Gabbert of the Circuit Court for Clay County accorded
the plaintiffs $2.8 million legal fees and $4.8 million
prejudgment interest, Star reports. In addition, Judge Gabbert
accorded the plaintiffs $100,000 for legal expenses, $35,000
"incentive" to two lead plaintiffs and 10.25% judgment interest as
of May 9, 2007, Star relates.
Early this week, Judge Gabbert consolidated damages that
overlapped and got a sum of $7.3 million, Star reveals.
Corporate counsel, Robert O. Jester, Esq., at Ensz & Jester, told
Star that the company intends to file and appeal on Judge
Gabbert's final judgment.
Meanwhile, plaintiff's counsel indicated plans to seek judgment
against Honda of Tiffany Springs, which bought John Chezik two
years ago, Star says.
Money-Back Guarantee Class Action Suit
Keith and Deborah Shackleford residing at Gladstone filed a case
against the Debtor in 2002 against John Chezik, which operates
John Chezik Honda in a class action relating to a "100 percent
money-back guarantee" that the company offered on its vehicle
service contracts.
The class consisted of 1,186 customers who bought contracts from
Jan. 1, 1997, to Dec. 22, 2003, and who got the money-back
guarantees and made no claim under the contracts.
Law firm Blackwell Sanders Peper Martin LLP commenced the suit
on behalf of named plaintiffs Keith and Deborah Shackelford, who
bought a 1995 Honda Accord from the company. The Shackelfords
also bought a service contract, which said a customer would be
refunded the entire cost of the contract if no claims were made
on it.
The Shackelfords said they made no claims. They returned to the
dealership in April 2002 to request their refund but allegedly
were told they could receive only credit toward another car
purchase. The dealership offered to refund the Shackelfords'
money after talks with their lawyers, but the company refused to
pay legal fees and other costs.
In May 9, 2007, Clay County Circuit Court jury awarded more than
$3.4 million in actual damages to certain buyers of vehicles sold
by auto dealer John Chezik and A&L Holding.
The jurors originally agreed upon a settlement of $8.4 million.
However, the amount for punitive damages had to be adjusted
pursuant to Missouri law. Aside from that, they returned two
separate judgments for punitive damages for $5 million, subject to
court's final judgment.
About John Chezik Homerun
Kansas City, Missouri-based John Chezik Homerun Inc. dba John
Chezik Honda is a subsidiary of A&L Holding Co. It retails new
and used cars. Honda of Tiffany Springs acquired Chezik's assets
in 2005. In December 2007, John Chezik filed for bankruptcy
protection under chapter 7 in hopes to pay off debts, specifically
those of class action claimants.
JOHNSON RUBBER: Court Approves Benesch Friendlander as Counsel
--------------------------------------------------------------
The Hon. Randolph Baxter of the United States Bankruptcy Court
Northern District of Ohio authorized Johnson Rubber Company Inc.
and its parent holding company, JR Holding Corp., to employ
Benesch, Friedlander, Coplan & Aronoff LLP as their attorney.
As reported in the Troubled Company Reporter on Jan. 8, 2008,
Benesch Friendlander is expected to:
a) advise the Debtors of their rights, powers and duties as
debtors in possession that are continuing to operate and
manage their businesses and property;
b) attending meetings and negotiations with representative of
creditors and other parties in interest;
c) prepare on behalf of the Debtors all necessary and
appropriate applications, motions, pleadings, draft orders,
notices, schedules, and other documents, and reviewing all
financial and other reports to be filed with the Court in
these Chapter 11 cases;
d) advise the Debtors concerning, and preparing responses to,
applications, motions, pleadings, notices and other papers
that may be filed and served in these Chapter 11 cases;
e) advise the Debtors concerning, and assisting in the
negotiation and documentation of, the refinancing or sale of
their assets, debt and lease restructuring, executory
contract and unexpired lease assumptions, assignments or
rejections, and related transactions;
f) review the nature and validity of liens asserted against the
Debtors' property and advising the Debtors concerning the
enforceability of the liens;
g) advising the Debtors concerning the actions that they might
take to collect and recover property for the benefit of
their estates;
h) counsel the Debtors in connection with the formulation,
negotiation, and confirmation of plan or plans of
reorganization and related documents; and
i) perform other legal services for and on behalf of the
Debtors as may be necessary or appropriate in the
administration of their Chapter 11 cases and businesses,
including advising assisting the Debtors with respect to
debt restructuri8ng, corporate governance issues related to
restructuring, stock or asset dispositions and general
business and litigation matters.
Before the Debtors filed for bankruptcy, they paid the firm
approximately $194,948 for legal services in connection with the
evaluation of their financial restructuring alternatives and first
day documents and pleadings.
The firm's professionals and their compensation rates are:
Professionals Designations Hourly Rates
------------- ------------ ------------
William I. Kohn, Esq. Partners $645
Raymond H. Lemisch, Esq. Partners $545
Bradford J. Sandler, Esq. Partners $475
David M. Neumann, Esq. Associates $320
Jennifer R. Hoover, Esq. Associates $300
Scott B. Lepene, Esq. Associates $240
Lisa M. Behra Paralegal $160
Sandi Van Dyk Paralegal $145
William I. Kohn, Esq., a partner of the firm, assured the Court
that the firm does not hold any interest adverse to the Debtors'
estate and is a "disinterested person" as defined in Section
101(14).
Mr. Kohn can be reached at:
William I. Kohn, Esq.
Benesch Friedlander Coplan & Aronoff LLP
2300 BP Tower
200 Public Square
Cleveland, OH 44114-2378
Tel: (216) 363-4500
Fax: (216) 363-4588
http://www.bfca.com/
Headquatered in Middlefield, Ohio, Johnson Rubber Company
Inc. -- http://www.johnsonrubber.com/-- designs, develops
and manufactures polymer components. The company and its
parent, JR Holding Corp., filed for Chapter 11 protection on
December 11, 2007 (Bankr. N.D. Ohio, Lead Case No. 07-19391). The
Debtors selected Donlin Recano as claims, noticing and balloting
agent. The United States Trustee for Region 9 appointed four
creditors to serve on an Official Committee of Unsecured Creditors
in this cases. When the Debtors filed for protection against
their creditors, they listed total assets at $15,346,607 and
total debts at $19,869,931.
JOHNSON RUBBER: Development Specialists OK'd as Financial Advisor
-----------------------------------------------------------------
The Hon. Randolph Baxter of the United States Bankruptcy Court
Northern District of Ohio gave Johnson Rubber Company Inc. and its
parent holding company, JR Holding Corp., permission to employ
Development Specialist Inc. as their financial advisor.
As reported in the Troubled Company Reporter on Jan 8, 2008,
Development Specialists is expected to:
a) assist the Debtors' development, review and evaluation of
its overall restructuring plan and aid in its
implementation;
b) assist the Debtors with the development and preparation of
financially oriented analyses and reports and provide other
assistance to its financial reorganization;
c) participate in negotiations with creditors, stakeholders,
and other appropriate parties in connection with any
reorganization or wind down plan;
d) assist in the development and implementation of a short-term
budget, cash flow projections and operating plans;
e) assist in the preparation of required bankruptcy schedules
and statement of financial affairs as well as periodic
reports to be submitted to a Bankruptcy Court; and
f) perform other tasks as may be agreed to by the firm and
directed by the Debtors.
The firm's professionals and their compensation rates are:
Professionals Hourly Rates
------------- ------------
Fred C. Caruso $550
Patrick J. O'Malley $495
Eric R. Sweitzer $350
Elizabeth M. Lynch $350
Jill E. Costie $260
Patrick J. O'Malley, a consultanht and cheif official officer of
the firm, assures the Court that the firm is a "disinterested
person" as defined in Section 101(14) of the Bankruptcy Code.
Headquatered in Middlefield, Ohio, Johnson Rubber Company
Inc. -- http://www.johnsonrubber.com/-- designs, develops
and manufactures polymer components. The company and its
parent, JR Holding Corp., filed for Chapter 11 protection on
December 11, 2007 (Bankr. N.D. Ohio, Lead Case No. 07-19391). The
Debtors selected Donlin Recano as claims, noticing and balloting
agent. The United States Trustee for Region 9 appointed four
creditors to serve on an Official Committee of Unsecured Creditors
in this cases. When the Debtors filed for protection against
their creditors, they listed total assets at $15,346,607 and
total debts at $19,869,931.
JOHNSON RUBBER: Court Defers DIP Facility Final Hearing to Jan. 29
------------------------------------------------------------------
The Hon. Randolph Baxter of the United States Bankruptcy Court
for the Northern District of Ohio will convene a final hearing
on Jan. 29, 2008, at 1:00 p.m., to consider approval of Johnson
Rubber Company Inc. and its parent holding company, JR Holding
Corp.'s request to access CIT Group/Business Credit Inc.'s DIP
facility.
On Dec. 13, 2007, Judge Baxter granted the Debtors to access, on
an interim basis, CIT Group's facility.
The Debtors tell the Court that CIT Group agreed to borrow up to
$10,000,000 with 2% plus the greater of the prime rate or federal
funds effective rate plus 1/2% and to mature on March 31, 2008.
The Debtors say that they grant the DIP lender senior liens in
postpetition accounts receivable and inventory, junior liens
in prepetition property subject to valid prepetiton lien and
superpriority claim over all administrative claims of the
Debtors.
As adequate protection, the Debtors say that they entitled the
DIP lender to retain priority of prepetition liens and collateral,
collect prepetion accounts receivable and proceeds of declared
inventory and apply to prepetition indebtedness and receive cash
payment of $100,000 per month.
Headquatered in Middlefield, Ohio, Johnson Rubber Company
Inc. -- http://www.johnsonrubber.com/-- designs, develops
and manufactures polymer components. The company and its
parent, JR Holding Corp., filed for Chapter 11 protection on
December 11, 2007 (Bankr. N.D. Ohio, Lead Case No. 07-19391). The
Debtors selected Donlin Recano as claims, noticing and balloting
agent. The United States Trustee for Region 9 appointed four
creditors to serve on an Official Committee of Unsecured Creditors
in this cases. When the Debtors filed for protection against
their creditors, they listed total assets at $15,346,607 and
total debts at $19,869,931.
JP MORGAN: Moody's Holds Low-B Ratings on Six Certificates
----------------------------------------------------------
Moody's Investors Service affirmed these ratings of J.P. Morgan
Chase Commercial Mortgage Securities Trust 2006-LDP7, Commercial
Pass-Through Certificates, Series 2006-LDP7:
-- Class A-1, $74,932,097, affirmed at Aaa
-- Class A-2, $255,782,000, affirmed at Aaa
-- Class A-3A, $75,000,000, affirmed at Aaa
-- Class A-3B, $94,109,000, affirmed at Aaa
-- Class A-3FL, $100,000,000, affirmed at Aaa
-- Class A-4, $1,616,079,000, affirmed at Aaa
-- Class A-J, $310,267,000, affirmed at Aaa
-- Class A-M, $393,989,000, affirmed at Aaa
-- Class A-SB, $170,204,000, affirmed at Aaa
-- Class A-1A, $348,866,915, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class B, $78,798,000, affirmed at Aa2
-- Class C, $44,323,000, affirmed at Aa3
-- Class D, $14,775,000, affirmed at A1
-- Class E, $39,399,000, affirmed at A2
-- Class F, $39,399,000, affirmed at A3
-- Class G, $49,248,000, affirmed at Baa1
-- Class H, $39,399,000, affirmed at Baa2
-- Class J, $44,324,000, affirmed at Baa3
-- Class K, $14,775,000, affirmed at Ba1
-- Class L, $14,774,000, affirmed at Ba2
-- Class M, $19,700,000, affirmed at Ba3
-- Class N, $4,925,000, affirmed at B1
-- Class P, $14,774,000, affirmed at B2
-- Class Q, $14,775,000, affirmed at B3
As of the Dec. 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by less than 1.0% to
$3.917 billion from $3.940 billion at securitization. The
Certificates are collateralized by 269 loans, ranging in size from
less than 1.0% to 6.1% of the pool, with the top ten loans
representing 36.2% of the pool. The pool has not experienced any
losses to date and currently there are no loans in special
servicing. Forty-five loans, representing 14.0% of the pool, are
on the master servicer's watchlist.
Moody's was provided with year-end 2006 operating results for
90.9% of the pool. Moody's weighted average loan to value ratio
is 101.1%, essentially the same as at securitization, resulting in
the affirmation of all classes.
The top three loans represent 16.1% of the pool. The largest loan
is the Westfield Centro Portfolio Loan ($240.0 million -- 6.1%),
which is secured by a 2.4 million square foot portfolio consisting
of five retail properties located in five states. The centers
range in size from 460,000 to 1.1 million square feet. The
portfolio was 91.9% occupied as of September 2007, compared to
92.8% at securitization. Moody's LTV is 98.9%, the same as at
securitization.
The second largest loan is the One & Two Prudential Plaza Loan
($205.0 million -- 5.2%), which is secured by two adjacent office
buildings in Chicago, Illinois. The loan represents a 50.0% pari
passu interest in a $410.0 million first mortgage loan. The
buildings were 89.7% leased as of August 2007, compared to 84.8%
at securitization. Major tenants include People Gas Light & Coke,
Baker and McKenzie and McGraw Hill, Inc. Performance is in-line
with securitization. Moody's LTV is 97.5%, the same as at
securitization.
The third largest loan is the Bella Terra Retail Loan
($188 million -- 4.8%), which is secured by a recently renovated
664,000 square foot open-air community shopping center located in
Huntington Beach, California. The center is anchored by
Burlington Coat Factory, Bed Bath & Beyond and Barnes and Noble.
The in-line stores were 96.0% occupied as of June 2007, compared
to 84.0% at securitization. Moody's analysis reflected a
stabilized occupancy level for the property, which has been
achieved. However, financial performance has been impacted by
higher than projected expenses. Moody's LTV is 108.2%, compared
to 106.1% at securitization.
KATONAH 2007-I: S&P Puts Preliminary BB Rating on $10.5MM Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Katonah 2007-I CLO Ltd./Katonah 2007-I CLO Corp.'s
$292.5 million floating-rate notes due April 2022.
The preliminary ratings are based on information as of Jan. 16,
2008. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect:
-- The credit enhancement provided through the subordination
of cash flows to each respective class;
-- The transaction's cash flow structure, which was subjected
to various stresses requested by Standard & Poor's; and
-- The transaction's legal structure, including the issuer's
bankruptcy remoteness.
Preliminary Ratings Assigned
Katonah 2007-I CLO Ltd./Katonah 2007-I CLO Corp.
Class Rating Amount (million)
----- ------ ----------------
A-1L AAA $227.00
A-2L AA $26.00
A-3L A $18.00
B-1L BBB $11.00
B-2L BB $10.50
Preferred shares NR $31.40
NR - Not rated.
KELLWOOD CO: Sun Capital Offer Prompts Moody's to Revise Outlook
----------------------------------------------------------------
Moody's Investors Service affirmed its ratings on Kellwood
Company, however it revised the rating outlook to negative from
stable.
The negative rating outlook follows the announcement that an
affiliate of Sun Capital Securities Group, LLC has commenced a
tender offer to purchase all outstanding shares of Kellwood
Company's common stock for $21 per share. The offer is not
contingent on financing or due diligence. Sun Capital, which owns
9.9% of the Kellwood's common shares, has also stated that if an
agreement is not reached in the near term it intends to nominate
its own slate of directors for election to Kellwood's Board at the
2008 Annual Meeting of Stockholders. Kellwood's Board of
Directors have stated they will review the offer and make a
recommendation to shareholders in due course.
The company's ratings could be adversely impacted in the event
that a successful tender offer or election of a new slate of
directors resulted in a transaction that resulted in a significant
increase in indebtedness, or if following a change of control
there were to be a material change in the company's operating and
financial policies. The ratings could also be negatively impacted
were Kellwood to adopt a more aggressive financial policy in
response to shareholder pressure.
Moody's has previously commented that the company's existing
ratings were not impacted by the sale of the company's Smart Shirt
manufacturing operations and related real estate assets as it was
anticipated a material portion of the net cash proceeds would be
used to reduce debt. In that connection the company's repayment
of Smart Shirt's debt of approximately
$33 million and the announced tender for $60 million of the
company's senior notes due 2009 were consistent with these
expectations.
These ratings were affirmed:
-- Corporate Family Rating at Ba3;
-- Probability of Default Rating at Ba3;
-- $140 million Debentures due July 15, 2009: B1
(LGD 5, 70%);
-- $130 million Debentures due Oct. 15, 2017: B1
(LGD 5, 70%).
Based in St Louis, Missouri, Kellwood Company is a marketer of
apparel and consumer soft goods, specializing in branded as well
as private label products, marketed across a number of channels of
distribution. The company's brand portfolio includes "Sag
Harbor", "Gerber", "Hanna Andersson" and "Vince". The company
reported revenues of $1.5 billion in its most recent fiscal year,
pro-forma for the recent divestiture of Smart Shirts.
LAKE AT LAS VEGAS: S&P Cuts Then Withdraws Ratings
--------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
ratings on Lake at Las Vegas Joint Venture and LLV-1 LLC to 'D'
from 'CC'. Concurrently, S&P lowered the rating on a $540 million
senior secured credit facility to 'D' from 'CCC-' and left the '2'
recovery rating unchanged. S&P then withdrew all ratings due to a
lack of information following the acquisition of the equity
interests in the borrowers' assets by an unrated private company.
The ratings acknowledge a fourth-quarter 2007 interest payment
default by the borrowers and the subsequent sale of the borrowers'
equity interests to The Atalon Group LLC for an undisclosed
amount. The borrowers were limited liability companies formed to
acquire the land and construct the infrastructure improvements at
the Lake Las Vegas Resort, a 3,600-acre master-planned residential
and resort community in Henderson, Nev. Atalon is a privately
held operational turnaround firm based in Las Vegas. An Atalon
executive served as chief restructuring officer to the borrowers
prior to a technical default under the senior secured credit
facility and during the forbearance period.
Standard & Poor's previously acknowledged that the borrowers'
senior secured credit facility was highly vulnerable to nonpayment
due to the borrowers' extremely constrained liquidity position.
Creditors granted a temporary waiver of default related to the
borrowers' failure to close on the sale of a 62-acre manmade
island parcel by Sept. 30, 2007, as required under the terms
governing the credit facility. However, ensuing negotiations
with potential buyers were not successful, and the borrowers
failed to make scheduled interest payments by Dec. 31, 2007. The
equity interests in the borrowers' assets were then sold to Atalon
on Jan. 2, 2008.
Principals of the borrowers have resigned, and Atalon now owns and
manages the Lake Las Vegas project. S&P believes that Atalon is
exploring options to maximize the recovery value for creditors.
S&P's previous '2' recovery rating indicated S&P's expectation for
substantial recovery (70%-90%) in the event of default, but it was
based on cash flow projections provided by
the original borrowers' principals.
Ratings Lowered and Withdrawn
Lake at Las Vegas Joint Venture/LLV-1 LLC
To Interim From
-- ------- ----
Corporate credit NR D/NM/-- CC/Watch Neg/--
Secured debt NR D CCC-/Watch Neg/--
(Recovery rtg: 2) (Recovery rtg: 2)
LANDMARK FBO: Moody's Junks Rating on $120 Million 2nd Lien Loan
----------------------------------------------------------------
Moody's Investors Service assigned first time ratings of B1 to
Landmark FBO, LLC's first lien bank debt (consisting of a
$188 million term loan and a $30 million revolving credit
facility), Caa2 to the company's second lien term loan of
$120 million, and a B3 Corporate Family Rating and Probability of
Default rating. The rating outlook is stable.
Landmark is acquiring certain aviation businesses from DAE
Aviation Holdings, Inc. as well as additional businesses currently
operating as Encore FBO. Landmark's activities include fixed base
operations and select light maintenance & repair operations
services to the general aviation segment. Landmark will be the
third largest network of FBOs with 42 bases in North America and
Western Europe.
The B3 Corporate Family Rating recognizes the considerable
leverage deployed in the borrower's capital structure, the modest
scale of Landmark's business operations, and sensitivity of its
results to minor downside scenarios in volumes and margins given
the level of fixed cost inherent in its operations. The rating
further considers that Landmark's future results must exceed
historical performance in order for significant amounts of free
cash flow to be achieved. As well there is some concentration
risk with overall results dependent on performance of certain FBOs
whose initial lease terms expire within the first few years of the
transaction. Partially offsetting the latter is management's
experience in successfully renewing its leases and the
diversification provided by the number of airports at which
Landmark will have a presence as well as their dispersion across
North America and select locations in Europe. The rating
incorporates favorable growth prospects for jet fuel demand in the
GA sector over time, limitations on the number of competitors at
any one airport which effectively establish some barriers to
entry, and expectations that the company will be modestly free
cash flow generative in 2008. Sustaining margins in its dominant
fuel services segment will be critical to Landmark's future
performance, which will be exposed to macro-economic factors or
changes in government regulations that could impact the level of
corporate jet travel. The company will need to execute in a
timely manner on its strategy of realizing cost synergies from the
amalgamation of two separate ensembles of FBOs. Moody's also
anticipates that Landmark's strategy may include acquiring
additional FBO sites such that it is more likely that the borrower
would remain extensively levered.
The stable outlook considers the likelihood that demand for jet
aviation fuel will continue to increase, and combined with
management's track record in maintaining margins on fuel sales,
consistent although modest free cash flow could be expected. The
geographic spread of its airport locations, diversified customer
base as well as a sufficient liquidity profile provide further
support to the stable outlook.
The ratings for the first lien credit facilities and second lien
term loan are the product of an overall probability of default, to
which Moody's assigns a PDR of B3, and a loss given default of
LGD-3, 31% for the first lien facilities and LGD-5, 82% for the
second lien term loan. The B1 rating of the first lien senior
secured credit facilities reflect their priority position within
Landmark's capital structure, the benefits of guarantees from all
material subsidiaries and an all asset pledge, and a significant
amount of junior liabilities behind their claims. The Caa2 rating
assigned to the second lien term loan reflects their status behind
the first lien obligations, the same set of up-streamed
guarantees, and a modest amount of unsecured liabilities further
below in the waterfall of claims.
Ratings assigned:
Landmark FBO, LLC
-- Corporate Family Rating, B3
-- Probability of Default, B3
-- $30 million first lien revolving credit facility, B1 (LGD-
3, 31%)
-- $188 million first lien term loan, B1 (LGD-3, 31%)
-- $120 million second lien term loan, Caa2 (LGD-5, 82%)
The acquisition of the DAE business units is valued at
approximately $436 million with some $280 million of the proceeds
intended to retire debt at DAE. The balance of funds provided by
the term loans and equity contributions from the sponsors will be
used to refinance existing Encore FBO debt as well as for
transaction fees and expenses. The revolving credit facility is
not expected to be drawn at the time of closing of the financing.
Landmark FBO, LLC will be managed from Houston, Texas and will
operate 42 bases for general aviation services across North
America and Western Europe. Principal offerings include
refueling, light maintenance and repair of private jets, fuel
logistics for the Department of Defense, replacement parts as well
as airplane parking, cleaning and chartering on behalf of owners.
Annual revenues are expected to be around $400 million (excluding
certain un-restricted subsidiaries).
LAS VEGAS SANDS: Completes Initial Funding of Credit Facility
-------------------------------------------------------------
Las Vegas Sands Corp. has completed the initial funding of
SGD$2 billion under its credit facility for the development
of the Marina Bay Sands in Singapore.
The initial borrowing under the credit facility, for which the
interest rate is based on the Singapore Dollar Swap Offer Rate for
a maturity of thirty days, bears interest at approximately 3.6%.
"We are pleased to have completed the first drawdown of
this precedent-setting financing for our Marina Bay Sands
development," Sheldon G. Adelson, Las Vegas Sands Corp. chairman
and chief executive officer, stated.
"The credit facility, which is the largest private Singapore
Dollar-denominated financing ever completed, will provide flexible
and cost effective financing as we build South Asia's first
Integrated Resort," Mr. Adelson continued. "We are quite
gratified that the Singapore interest rate is significantly below
the rates which we would have to incur in the U.S. or other
international markets in today's market."
About Las Vegas Sands
Headquartered in Las Veags, Nevada Las Vegas Sands Corp.
(NYSE:LVS) -- http://www.lasvegassands.com/-- owns and operates
The Venetian Resort-Hotel-Casino and the Sands Expo and Convention
Center in Las Vegas and The Venetian Macao Resort-Hotel and the
Sands Macao in the People's Republic of China Special
Administrative Region of Macao. The company is constructing three
additional integrated resorts: The Palazzo Resort-Hotel-Casino in
Las Vegas; Sands Bethworks(TM) in Bethlehem, Pennsylvania; and The
Marina Bay Sands(TM) in Singapore.
LVS is also creating the Cotai Strip(TM), a master-planned
development of resort-casino properties in Macao. Additionally,
the companyis working with the Zhuhai Municipal People's
Government of the PRC to master-plan the development of a leisure
resort and convention complex on Hengqin Island in the PRC.
* * *
Las Vegas Sands Corp. still carries Standard & Poor's Ratings
Services 'BB-' long term foreign and local issuer credit ratings,
which were placed on April 17, 2007. Rating outlook is stable.
LB COMMERCIAL: Moody's Maintains Junk Ratings on Two Classes
------------------------------------------------------------
Moody's Investors Service upgraded these ratings of two classes
and affirmed the ratings of 12 classes of LB Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-
C4:
-- Class A-1-b, $621,447,315, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class A-2, $316,419,303, affirmed at Aaa
-- Class B, $106,343,000, affirmed at Aaa
-- Class C, $106,344,000, affirmed at Aaa
-- Class D, $121,535,000, affirmed at Aaa
-- Class E, $30,384,000, upgraded to Aaa from Aa3
-- Class F, $50,640,000, upgraded to A2 from Baa1
-- Class G, $45,576,000, affirmed at Ba1
-- Class H, $15,192,000, affirmed at Ba3
-- Class J, $20,255,000, affirmed at B1
-- Class K, $10,128,000, affirmed at B3
-- Class L, $15,192,000, affirmed at Caa2
-- Class M, $10,128,000, affirmed at Caa3
As of the Dec. 17, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 27.0%
to $1.5 billion from $2.0 billion at securitization. The
Certificates are collateralized by 245 loans ranging in size from
less than 1.0% to 13.6% of the pool, with the top 10 loans
representing 46.7% of the pool. The pool consists of a shadow
rated component, representing 33.9% of the pool, a conduit
component, representing 30.8% of the pool and a credit tenant
lease component, representing 3.0% of the pool. Eighty-six loans,
representing 32.3% of the pool, have defeased and have been
replaced with U.S. Government securities. There is one loan,
representing 0.4% of the pool balance, in special servicing.
Moody's has estimated a loss of approximately $3.1 million for the
specially serviced loan. Eight loans have been liquidated from
the pool resulting in realized aggregate losses of approximately
$16.0 million. Sixty-six loans, representing 21.2% of the pool,
are on the master servicer's watchlist.
Moody's was provided with year-end 2006 operating results for
95.7% of the performing loans excluding defeased assets and CTL
loans. Moody's weighted average loan to value ratio for the
conduit component is 81.8%, compared to 82.6% at Moody's last full
review in November 2006 and compared to 92.0% at securitization.
Moody's is upgrading Classes E and F due to increased
subordination levels, defeasance and stable overall pool
performance.
The largest shadow rated loan is the TRT Holdings Loan
($200.6 million - 13.6%), which is secured by five Omni Hotels
located in New York, Chicago and Texas. The portfolio contains
1,858 rooms with the hotels ranging in size from 337 to 410 rooms.
The portfolio's RevPAR for calendar year 2006 was $150, which
represents an 11.0% increase since 2005. All of the five hotels
reported increases in net operating income since last review
ranging from 0.9% to 25.1%. The loan has amortized 19.5% since
securitization and matures in Sept. 2008. Moody's current shadow
rating is Baa1 compared to Ba1 at last review and compared Baa1 at
securitization.
The second largest shadow rated loan is the Mills Loan
($128.2 million - 8.7%), which is secured by a 1.2 million square
foot super regional mall located in Ontario, California. NOI
increased 9.2% from calendar year 2005 to 2006 and increased 37.3%
since securitization. The loan has amortized 11.6% since
securitization and matures in December 2008. Moody's current
shadow rating is A1, compared to A3 at last review and compared to
Baa3 at securitization.
The third largest shadow rated loan is the Fresno Fashion Fair
Mall Loan ($63.6 million - 4.3%), which is secured by an 881,000
square foot regional mall located in Fresno, California. The
property's performance has improved significantly since
securitization, largely due to its dominant market position. Net
operating income has increased by approximately 18.1% from 2005 to
2006 and approximately 91.0% since securitization. As of June
2007, the mall was 98.6% occupied essentially the same as at
securitization. The center is anchored by J.C. Penney, Macys and
Gottschalks. The loan has amortized 7.8% since securitization and
matures in August 2008. Moody's current shadow rating is Aaa
compared to Aa2 at last review and compared to Baa3 at
securitization.
The fourth largest shadow rated loan is the Inland Portfolio Loan
($54.6 million - 3.7%), which is secured by a portfolio of 12
retail properties located in Illinois, Minnesota, Indiana and
Wisconsin. The portfolio totals 1.2 million square feet. As of
June 2007, occupancy was 85.5% compared to 96.5% at last review
and compared to 98.0% at securitization. The loan is interest
only through the Anticipated Repayment Date of Oct. 1, 2008.
Moody's current shadow rating is Baa3, compared to Baa1 at last
review and compared to A3 at securitization.
The fifth largest shadow rated loan is the Bayside Loan
($54.3 million - 3.7%), which is secured by the Bayside
Marketplace, a 231,000 square foot specialty retail center located
in Miami, Florida. As of June 2007, occupancy was 85.1% compared
to 86.9% at last review and compared to 96.0% at securitization.
Overall performance has improved as NOI increased 5.8% from 2005
to 2006 and increased 19.7% since securitization. The loan has
also amortized 13.7% since securitization and matures in November
2008. Moody's current shadow rating is A3, compared to Baa2 at
last review and compared to Ba1 at securitization.
The top three non-defeased conduit loans represent 3.5% of the
pool. The CTL component includes 25 loans secured by properties
under bondable leases. The largest CTL exposures are Food Lion
($9.9 million; parent Delhaize America, Inc; Moody's senior
unsecured rating Baa3; stable outlook), CVS ($8.8 million; Moody's
senior unsecured rating Baa2; stable outlook) and Walgreen ($7.0
million; Moody's senior unsecured rating Aa3; negative outlook).
The weighted average shadow rating for the CTL component is Ba2,
compared to Baa3 at securitization.
LEHMAN XS: Moody's Cuts Ratings on Five Tranches on Delinquency
---------------------------------------------------------------
Moody's Investors Service downgraded the ratings of five tranches
from two transactions issued by Lehman XS Trust in 2007. One
downgraded tranche remains on review for possible downgrade. The
collateral backing these classes primarily consists of first lien,
adjustable-rate negatively amortizing Alt-A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
Lehman XS Trust Series 2007-12N
-- Cl. 2-M6, Downgraded to Baa2, previously Baa1,
-- Cl. 2-M7, Downgraded to Ba1, previously Baa1,
-- Cl. 2-M8, Downgraded to B2, previously Baa3,
Lehman XS Trust Series 2007-7N
-- Cl. M8, Downgraded to Ba2, previously Ba1,
-- Cl. M9, Downgraded to B3 on review for possible further
downgrade, previously Ba2.
LEOPOLDO TREVINO: Case Summary & Three Largest Unsecured Creditors
------------------------------------------------------------------
Debtors: Leopoldo Trevino
Aurora Trevino
dba Aurora Flowers
1430 West Flora Street
Reedley, CA 93651
Bankruptcy Case No.: 08-10244
Chapter 11 Petition Date: January 15, 2008
Court: Eastern District of California (Fresno)
Judge: W. Richard Lee
Debtors' Counsel: Hilton A. Ryder, Esq.
McCormick, Barstow, Sheppard, Wayte & Carruth
LLP
5 River Park Place East
Fresno, CA 93720-1501
Tel: (559) 433-1300
Total Assets: $2,521,491
Total Debts: $1,321,442
Debtors' list of their Three Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Sierra Kings District Hospital $7,815
1300 West Main Street
Visalia, CA 93278
Sears Credit Cards $542
P.O. Box 6937
The Lakes, NY 88901
J.C. Penny $300
c/o GEMB
P.O. Box 981131
El Paso, TX 79998-1131
Mervyn's/GE Money Bankruptcy $290
LEVITZ FURNITURE: Can Use GECC's Cash Collateral on Final Basis
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved, on a final basis, the stipulation between General
Electrical Capital Corporation and PLVTZ Inc., granting the Debtor
authority to use its prepetition secured lenders' cash collateral.
The Debtor is authorized to use Cash Collateral for the period
from the Petition Date through the earlier of (a) the Court's
entry of an order terminating the authority, or (b) the date
which is three business days following notice by by GECC, as
agent, or the Debenture Holder to the Debtor that an event of
default has occurred and is continuing.
Cash Collateral may be used during the Specified Period solely up
to the amounts -- subject to a 5% variance -- and substantially
for the purposes identified in the cash collateral budget
approved by the Agent.
A full-text copy of the Cash Collateral Budget is available for
free at:
http://bankrupt.com/misc/PLVTZWind-DownBudget
All objections to the stipulation, to the extent not withdrawn or
resolved, are overruled.
As part of the settlement and release of claims of the Debtor's
estate, the the Official Committee of Unsecured Creditors agrees,
among other things, that as of the Petition Date, the value of
the Agent and Lenders' interest in the Prepetition Collateral was
$46,936,000, which amount exceeds the amount of the Senior
Obligations.
Accordingly, the Creditors' Committee consents to the allowance
of the Senior Obligations as fully secured claims, up to
$46,936,000. Any payments made or to be made on account of the
Senior Obligations have been or will be for the benefit of the
Agent or Lenders on account of amounts in respect of which the
Agent and Lenders were oversecured and do not diminish any
property otherwise available for distribution to general
unsecured creditors.
The Creditors' Committee will investigate and challenge the
validity, priority and perfection of the Senior Obligations and
the Senior Liens, that the Debtor and its estate have no offsets,
defenses, claims, objections, challenges, causes of action,
including without limitation claims, against the Agent, the
Lenders, the Debenture Holder.
A full-text copy of the Final Order authorizing use of Cash
Collateral is available for free at:
http://bankrupt.com/misc/PLVTZApprovedCashCollateralStipulation
As reported in the Troubled Company Reporter on Nov. 15, 2007,
Judge Gerber gave PLVTZ and its debtor-affiliates interim
permission to use the cash collateral securing repayment of their
obligations to General Electrical Capital Corporation.
About Levitz Furniture
Based in New York City, Levitz Furniture Inc., nka PVLTZ Inc. --
http://www.levitz.com/-- is a specialty retailer of furniture,
bedding and home furnishings in the United States. It has 76
locations in major metropolitan areas, principally in the
Northeast and on the West Coast of the United States.
Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on
Sept. 5, 1997. In December 2000, the Court confirmed the Debtors'
Plan and Levitz emerged from chapter 11 on February 2001. Levitz
Home Furnishings Inc. was created as the new holding company as a
result of the emergence.
Levitz Home Furnishings and 12 affiliates filed for chapter 11
protection on Oct. 11, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
45189). In their second filing, the Debtors disclosed about
$245 million in total assets and $456 million in total debts.
Nicholas M. Miller, Esq., and Richard H. Engman, Esq., at Jones
Day represented the Debtors. Jeffrey L. Cohen, Esq., Jay R.
Indyke, Esq., and Cathy Hershcopf, Esq., at Cooley Godward Kronish
LLP served as counsel to the Official Committee of Unsecured
Creditors. During this period, the Debtors closed around 35
stores in the Northeast, California, Minnesota and Arizona.
PLVTZ Inc., a company created by Prentice Capital Management LP,
and Great American Group purchased substantially all the assets of
Levitz Home Furnishings in December 2005. Initially, Prentice
owned all of the equity interests in PLVTZ. On July 6, 2007,
PLVTZ was converted into a Delaware corporation, and Harbinger
Capital Partners Special Situations Fund, LP, Harbinger Capital
Partners Master Fund I, Ltd., and their affiliates became minority
shareholders. Great American's stake in the acquisition was in
running the going-out-of-business sales for some 27 Levitz units.
PLVTZ, dba Levitz Furniture, continued to face decline in
financial performance since December 2005. Liquidity issues and
the inability to obtain additional capital prompted PLVTZ to seek
protection under chapter 11 on Nov. 8, 2007 (Bankr. S.D.N.Y. Lead
Case No. 07-13532). Paul D. Leake, Esq., and Brad B. Erens, Esq.,
at Jones Day represents the Debtors in their restructuring
efforts. Kurtzman Carson Consultants LLC serves as the Debtors'
claims and noticing agent. The Debtor's schedules reveal total
assets of $123,842,190 and total liabilities of $76,421,661. The
Debtors' exclusive period to file a chapter 11 plan expires on
March 7, 2008. (Levitz Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
PLVTZ's balance sheet at Sept. 30. 2007, showed total assets of
$177,883,000 and total liabilities of $152,476,000.
LEVITZ FURNITURE: Can Hire Rodman & Renshaw as Financial Advisor
----------------------------------------------------------------
The Hon. Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York approved, on a final basis, the
employment of Rodman & Renshaw LLC, as PLVTZ Inc. dba Levitz
Furniture Inc.'s financial advisors.
Judge Gerber permitted Rodman & Renshaw to receive a fee of
$75,000, subject to review, for the services it provided from
Nov. 8 to Dec. 3, 2007. The firm, however, is not allowed to
receive a "going concern fee or a partial going concern fee."
Rodman & Renshaw is also entitled to reimbursement of out-of-
pocket expenses incurred in connection with the employment, in an
amount not to exceed $3,992.
Judge Gerber further ruled that all requests of Rodman & Renshaw
for payment of indemnity should be made by means of an
application and should be subject to review by the Court. The
firm, however, will not be indemnified as a result of its own
gross negligence, willful misconduct, among others.
Judge Gerber permitted the United States Trustee for Region 2 to
retain its rights to object to the firm's interim and final fee
applications on all grounds. On the other hand, he ruled that
the Official Committee of Unsecured Creditors should be deemed to
have waived its right to object to the application, to the extent
Rodman & Renshaw files the application consistent with the terms
of the Court order.
Judge Gerber further ruled that a $100,000 minimum fee, and
reimbursement of expenses should be paid from the carve-out for
the professionals.
Rodman & Renshaw is required to file a final fee application on
or before Feb. 29, 2008.
About Levitz Furniture
Based in New York City, Levitz Furniture Inc., nka PVLTZ Inc. --
http://www.levitz.com/-- is a specialty retailer of furniture,
bedding and home furnishings in the United States. It has 76
locations in major metropolitan areas, principally in the
Northeast and on the West Coast of the United States.
Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on
Sept. 5, 1997. In December 2000, the Court confirmed the Debtors'
Plan and Levitz emerged from chapter 11 on February 2001. Levitz
Home Furnishings Inc. was created as the new holding company as a
result of the emergence.
Levitz Home Furnishings and 12 affiliates filed for chapter 11
protection on Oct. 11, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
45189). In their second filing, the Debtors disclosed about
$245 million in total assets and $456 million in total debts.
Nicholas M. Miller, Esq., and Richard H. Engman, Esq., at Jones
Day represented the Debtors. Jeffrey L. Cohen, Esq., Jay R.
Indyke, Esq., and Cathy Hershcopf, Esq., at Cooley Godward Kronish
LLP served as counsel to the Official Committee of Unsecured
Creditors. During this period, the Debtors closed around 35
stores in the Northeast, California, Minnesota and Arizona.
PLVTZ Inc., a company created by Prentice Capital Management LP,
and Great American Group purchased substantially all the assets of
Levitz Home Furnishings in December 2005. Initially, Prentice
owned all of the equity interests in PLVTZ. On July 6, 2007,
PLVTZ was converted into a Delaware corporation, and Harbinger
Capital Partners Special Situations Fund, LP, Harbinger Capital
Partners Master Fund I, Ltd., and their affiliates became minority
shareholders. Great American's stake in the acquisition was in
running the going-out-of-business sales for some 27 Levitz units.
PLVTZ, dba Levitz Furniture, continued to face decline in
financial performance since December 2005. Liquidity issues and
the inability to obtain additional capital prompted PLVTZ to seek
protection under chapter 11 on Nov. 8, 2007 (Bankr. S.D.N.Y. Lead
Case No. 07-13532). Paul D. Leake, Esq., and Brad B. Erens, Esq.,
at Jones Day represents the Debtors in their restructuring
efforts. Kurtzman Carson Consultants LLC serves as the Debtors'
claims and noticing agent. The Debtor's schedules reveal total
assets of $123,842,190 and total liabilities of $76,421,661. The
Debtors' exclusive period to file a chapter 11 plan expires on
March 7, 2008. (Levitz Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
PLVTZ's balance sheet at Sept. 30. 2007, showed total assets of
$177,883,000 and total liabilities of $152,476,000.
LIBERTY MEDIA: Discloses Semi-Annual Payment to Debenture Holders
-----------------------------------------------------------------
Liberty Media Corporation disclosed a semi-annual payment to the
holders of its 3.5% Senior Exchangeable debentures due in
2031. The amount of the payment is $17.50 per $1,000 of
original principal amount of the debentures.
This semi-annual payment will result in the further reduction of
the adjusted principal amount of the debentures. The
principal amount of the debentures was reduced in the amount of
$162.616 per debenture, resulting in an adjusted principal amount
equal to $837.384 per debenture.
This adjustment resulted from an extraordinary distribution
of cash that was paid to bondholders on Jan. 10, 2007, in
accordance with the indenture governing the debentures. This
extraordinary distribution arose from Freescale Semiconductor's
merger with an entity controlled by a consortium of private equity
firms in exchange for cash.
At that time, Liberty disclosed that, in accordance with the
indenture, the adjusted principal amount of the debentures would
be further reduced on each successive semi-annual interest payment
date to the extent necessary to cause the semi-annual payment on
that date to represent the payment by Liberty, in arrears, of an
annualized yield of 3.5% of the adjusted principal amount of the
debentures.
The adjustments will not affect the amount of the semi-annual
payments received by holders of the debentures, which will
continue to be a rate equal to 3.5% per annum of the original
principal amount of the debentures.
The details of the amount of the payment made on the debentures,
its allocation between payment of interest and repayment of
principal and the revised adjusted principal amount resulting from
the payment, per $1,000 of original principal amount of the
debentures are:
Beginning Adjusted Principal: $834.5382
Payment: $17.50
Interest: $14.6044
Additional Payment of Principal: $2.8956
Ending Adjusted Principal: $831.6426
The semi-annual interest payment and additional distribution were
expected to be made on Jan. 15, 2008, to holders of record of the
debentures on Jan. 1, 2008.
About Liberty Media
Headquartered in Englewood, Colorado, Liberty Media Corporation
(NasdaqGS: LINTA) -- http://www.libertymedia.com/-- owns
interests in a broad range of electronic retailing, media,
communications and entertainment businesses. Those interests are
attributed to two tracking stock groups: the Liberty Interactive
group, which includes Liberty's interests in QVC, Provide
Commerce, IAC/InterActiveCorp, and Expedia, and the Liberty
Capital group, which includes Liberty's interests in Starz
Entertainment, News Corporation, and Time Warner.
* * *
Fitch Ratings assigned a BB long-term issuer default rating and a
BB senior unsecured debt rating to Liberty Media Corporation on
Dec. 22, 2006. The rating still holds to date.
LUMINENT MORTGAGE: Receives NYSE Non-Compliance Notice
------------------------------------------------------
Luminent Mortgage Capital Inc. received a letter from the New York
Stock Exchange, advising it that the company was not in compliance
with a NYSE continued listing standard applicable to its common
stock.
That standard requires that a listed common stock maintain an
average closing stock price of over $1 per share of common stock
for 30 consecutive trading days.
Under the NYSE rules, the companyhas ten business days, or until
Jan. 24, 2008, to notify the NYSE of its intent to cure this
deficiency. On Jan. 15, 2008, the companynotified the NYSE that
it is the company's intent to cure this deficiency.
Under the NYSE rules, the companyhas six months from the date of
the NYSE notice to cure the average price deficiency. If the
companyhas not cured the deficiency by that date, its
common stock would be subject to delisting by the NYSE.
About Luminent Mortgage
Headquartered in San Francisco, California, Luminent Mortgage
Capital Inc. -- http://www.luminentcapital.com/-- (NYSE: LUM) is
a real estate investment trust, or REIT. Luminent is an asset
management companythat invests in prime whole loans, U.S. agency
and other highly-rated, single-family, adjustable-rate, hybrid
adjustable-rate and fixed-rate mortgage-backed securities, which
it acquires in the secondary market.
Luminent Mortgage's consolidated balance sheet at Sept. 30, 2007,
showed $5.37 billion in total assets and $5.46 billion in total
liabilities, resulting in a $90.5 million total stockholders'
deficit.
LUMINENT MORTGAGE: Moody's Downgrades Ratings on Six Tranches
-------------------------------------------------------------
Moody's Investors Service downgraded the ratings of six tranches
and has placed under review for possible downgrade the ratings of
four tranches from two transactions issued by Luminent Mortgage
Trust in 2007. The collateral backing these classes primarily
consists of first lien, adjustable-rate negatively amortizing Alt-
A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
Luminent Mortgage Trust 2007-1
-- Cl. II-B-3 Currently Aa2, on review for possible
downgrade,
-- Cl. II-B-4, Downgraded to A3, previously A1,
-- Cl. II-B-5, Downgraded to Baa2, previously A3,
-- Cl. II-B-6, Downgraded to Ba1, previously Baa2,
Luminent Mortgage Trust 2007-2
-- Cl. II-B-2 Currently Aa1, on review for possible
downgrade,
-- Cl. II-B-3 Currently Aa2, on review for possible
downgrade,
-- Cl. II-B-4 Currently Aa3, on review for possible
downgrade,
-- Cl. II-B-5, Downgraded to Baa2, previously A2,
-- Cl. II-B-6, Downgraded to Ba1, previously Baa1,
-- Cl. II-B-7, Downgraded to Ba3, previously Baa2.
MAXJET AIRWAYS: Committee Wants to Hire Morris James as Co-Counsel
------------------------------------------------------------------
The Official Committee of Unsecured Creditors in MAXjet Airways
Inc.'s Chapter 11 case asks permission from the U.S. Bankruptcy
Court for the District of Delaware to employ Morris James LLP as
co-counsel with Arent Fox nunc pro tunc to Jan. 7, 2008.
The Committee noted that Morris James is familiar with the facts
of this Chapter 11 case, understands and knows the Debtor's
business issues, and has experience practicing before this Court.
The Committee relates that it is necessary to employ Morris James
to ensure that the interests of the Debtor's unsecured creditors
are represented adequately in an efficient and effective manner.
Morris James will:
a) provide legal advise and assistance to the Committee in
its consultation with the Debtor, in relation to the
Debtor's administration of its reorganization;
b) review and analyze all applications, motions, orders,
statements of operations and schedules filed with the
Court, advise the committee as to their propriety, and,
after consultation with the Committee, take appropriate
action;
c) prepare necessary applications, motions, answers, orders,
reports and other legal papers on behalf of the
Committee;
d) represent the Committee at Court hearings, communicate
with the Committee regarding the issues raised, well as
the decisions of the Court;
e) perform all other legal services for the Committee
necessary for this case.
Stephen M. Miller, a partner in Morris James, tells the Court that
the firm will seek compensation from the Debtor's estate for its
regular hourly rates of lawyers and paraprofessionals,
reimbursements of expenses incurred in behalf of the Committee.
Mr. Miller added that the professional rates are:
Name Hourly Rate
---- -----------
Stephen M. Miller $475
Carl N. Kunz, III $450
Thomas M. Horan $275
William W. Weller $190
Mr. Miller assues the Court that the firm does not hold any
interest adverse and is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Dulles, Virginia, MAXjet Airways Inc. --
http://www.maxjet.com/-- is an all-business class, long-haul
airline company. It has introduced scheduled services with
flights from London Stansted Airport to New York. As of December
2006, it leased five B767 aircraft. Its customers are both
business and leisure travelers. At the airport, its product
features check-in facilities located in primary terminals,
security and a business class departure lounge and arrivals
facility. Its flights features deep-recline seats (170 degree)
spaced at a 60 inch pitch, portable entertainment systems, stowage
space and business class catering.
The Debtor filed for chapter 11 protection on Dec. 24, 2007
(Bankr. D. Del. Case No. 07-11912). The Debtor selected Pachulski
Stang Ziehl & Jones LLP as its bankruptcy counsel. The Debtor
listed assets between $10 million and $50 million and debts
between $50 million to $100 million when it filed for bankruptcy.
MGM MIRAGE: Raises Tender Offer to 15 Million Shares
----------------------------------------------------
MGM Mirage and Dubai World will increase their offer to purchase
shares of MGM Mirage common stock from 10 million to 15 million,
and set the tender price at $80 per share from the price range of
$75 to $80 per share. The offer price represents approximately a
20.4% premium over MGM Mirage's closing stock price of $66.47 on
Jan. 15, 2008.
As reported in the Troubled company Reporter on Jan. 11, 2008,
MGM Mirage and Dubai World planned in making a cash tender
offer for up to 10 million shares of common stock of MGM Mirage at
a price per share of not less than $75 and not greater than $80.
With respect to the shares of MGM Mirage common stock that are
tendered and accepted for purchase pursuant to the offer, MGM
Mirage will purchase up to 8.5 million of said shares and Dubai
World will purchase up to 6.5 million of said shares.
Tracinda Corporation is the beneficial owner of 153,837,330 shares
of MGM Mirage common stock and has informed MGM Mirage that it
will not tender any of its shares.
Dubai World, through its affiliates Infinity World (Cayman) L.P.
and Infinity World Investments LLC, is the beneficial owner of
19,548,838 shares of MGM Mirage common stock. It is anticipated
that the bidder on behalf of Dubai World will be Infinity World
(Cayman) L.P.
Under the procedures for the tender offer, MGM Mirage's
stockholders will have the opportunity to tender some or all of
their shares at a price of $80 per share. If more than
15 million shares are tendered and not withdrawn, then MGM Mirage
and Infinity World will purchase shares on a pro rata basis,
subject to the conditional tender offer provisions that will be
described in the offer to purchase that will be distributed to
stockholders.
Stockholders whose shares are purchased in the offer will be paid
the $80 per share price net in cash, without interest, after the
expiration of the offer period. The offer is not contingent upon
any financing condition or any minimum number of shares being
tendered.
The offer is subject, however, to a number of other customary
terms and conditions to be specified in the offer to purchase that
will be distributed to stockholders. No brokerage fees or
commissions will be charged to holders who tender their shares.
About Dubai World
Dubai World is a major investment holding company with a portfolio
of businesses that includes DP World, Jafza, Nakheel, Dubai
Drydocks, Maritime City, Istithmar, Kerzner, One & Only, Atlantis,
Barney's, Island Global Yachting, Limitless, Inchcape Shipping
Services, Tejari, Technopark and Tamweel. The Dubai World Group
has more than 50,000 employees in over 100 cities around the
globe. The group also has real estate investments in the US, the
UK and South Africa. In the last five years, Dubai World has
developed 80,000 luxury residential villas and apartments and
approximately three million square feet of retail space.
About MGM Mirage
Headquartered in Las Vegas, Nevada, MGM Mirage (NYSE: MGM) --
http://www.mgmMirage.com/-- is a hotel and gaming company.
It owns and operates 17 properties located in Nevada, Mississippi
and Michigan, and has investments in three other properties in
Nevada, New Jersey and Illinois.
* * *
As reported in the Troubled company Reporter on Oct. 12, 2007,
Standard & Poor's Ratings Services affirmed the 'BB' corporate
credit rating on MGM Mirage and removed them from CreditWatch,
where they were placed with positive implications Aug. 22, 2007.
The rating outlook is positive.
MGM MIRAGE: Launches Sale of CityCenter's Harmon Hotel
------------------------------------------------------
MGM Mirage released the last of CityCenter's exclusive residential
offerings with the sales launch of The Harmon Hotel, Spa &
Residences.
"The release of The Harmon for purchase marks a significant
milestone as it represents the final opportunity for prospective
residents to own a piece of CityCenter," Tony Dennis, executive
vice president for CityCenter's Residential Division, said.
"We are confident that sales for The Harmon will exceed
expectations, and with only 207 residences available, we believe
the demand will be extraordinary. Through its remarkable
architecture, elite amenities, unmatched service and forward-
thinking environmental initiatives, CityCenter is quickly becoming
recognized as one of the world's most desirable residential
communities," Mr. Dennis continued.
Designed by Foster + Partners and operated by The Light Group, The
Harmon's 47-story facade will provide residents with views of the
boulevard when it opens in late 2009. With 400 hotel rooms and
suites, and approximately 207 luxury condominiums. Luxury
residences will range from nearly 1,000 to 3,700 square feet and
be available as one- and two-bedroom flats and penthouses.
"The Harmon will be sophisticated and absolutely original," Andrew
Sasson, founder and principal partner of The Light Group said.
"It will define exclusive living on The Strip by offering a unique
and highly stylish urban concept, supreme service and amenities,
and the very best location for those seeking to shun the limelight
in exchange for a secluded oasis."
Residents will have an access to all hotel amenities including:
the creation of Michael Chow with his MR CHOW restaurant in Las
Vegas; a hair salon by Frederic Fekkai; a private lobby lounge for
residents; other dining offerings; retail offerings in Las Vegas;
a luxurious spa; pool deck; valet parking and much more.
The Harmon, in line with Sasson's other enterprises, also will be
committed to the core values of green design and responsible
living.
"The Harmon will define a new era of sustainable luxury," said Mr.
Sasson. "It was designed to be an amalgamation of every great
lifestyle experience in the world; only better."
A design collaboration between MGM Mirage and eight architects,
CityCenter will feature a 61-story, 4,000-room hotel/casino; two
400-room, non-gaming hotels; a 500,000-square-foot retail and
entertainment district; and approximately 2,650 luxury residences.
Accepted as a member of The Leading Hotels of the World, The
Harmon will be one of the luxurious, quality boutique hotels with
approximately 207 elite condominiums and an array of amenities.
Interested buyers can make appointments to preview The Harmon
Residences at CityCenter's Residential Sales Pavilion by calling
(702) 590-5999 or (866) 708-7111, or visit --
http://www.citycenter.com/-- for more information.
About MGM Mirage
Headquartered in Las Vegas, Nevada, MGM Mirage (NYSE: MGM) --
http://www.mgmMirage.com/-- is a hotel and gaming company.
It owns and operates 17 properties located in Nevada, Mississippi
and Michigan, and has investments in three other properties in
Nevada, New Jersey and Illinois.
* * *
As reported in the Troubled company Reporter on Oct. 12, 2007,
Standard & Poor's Ratings Services affirmed the 'BB' corporate
credit rating on MGM Mirage and removed them from CreditWatch,
where they were placed with positive implications Aug. 22, 2007.
The rating outlook is positive.
MONEYGRAM INTL: $860 Mil. Losses Cues S&P to Cut Rating to BB
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term
counterparty credit rating on MoneyGram International to 'BB' from
'BBB'. The rating will remain on CreditWatch Negative, where it
was placed on Dec. 13, 2007.
"The downgrade follows MoneyGram's announcement that it has
experienced significant, additional unrealized losses on its float
investment portfolio, bringing cumulative net unrealized losses to
$860 million as of Nov. 30, 2007," said Standard & Poor's credit
analyst Rian Pressman.
As the company moves to restructure its Payment Systems business
and the associated float investment portfolio, these losses, which
heretofore have been recorded as adjustments to shareholder's
equity, will be realized. Given that the realized loss on a
$1.3 billion portion of the securities portfolio that was sold in
January 2008 was double the unrealized loss reflected as of
Nov. 30, 2007, the resulting effect on earnings may be more than
$1.5 billion,"a large amount considering that net income for the
first nine months of 2007 was $96 million. Earnings will be
affected in fourth-quarter 2007, as MoneyGram takes permanent
impairments on its subprime mortgage, CDO, and other ABS
investments. Earnings could also be affected in subsequent
quarters if the realized losses on these securities exceed the
previously booked unrealized losses.
MoneyGram also announced that it is in discussions with Thomas H.
Lee Partners L.P., a private equity firm, regarding recapitalizing
the company. The downgrade reflects the increased debt associated
with this recapitalization, as this will increase leverage
substantially above a level that is acceptable for an investment-
grade rating. In addition, given the magnitude of the losses that
S&P expects, it is unclear if the expected equity infusion would
leave MoneyGram with an adequate level of tangible capital.
Lastly, S&P are uncertain about what the expected 60%-65% initial
ownership percentage by Thomas H. Lee Partners will mean for
MoneyGram's strategy.
The current plan calls for approximately $750 million-$850 million
of equity to be invested, and MoneyGram would raise an additional
$550 million-$750 million of new debt facilities from third
parties. The funds would be used to buy government, agency, and
municipal securities to rebuild its float portfolio (which, per
clearing bank and regulatory agreements, must exceed its payment
obligations associated with official check and money orders).
MoneyGram also plans to shrink its Payment Systems business
substantially by refocusing on small and midsize bank
relationships; however, S&P believes this may take up to one year
or longer to fully implement. S&P expects the resulting Payment
Systems business to operate at substantially reduced
profitability, and this reduced earnings power is also a factor in
S&P's downgrade.
Offsetting these concerns to a certain extent is the continuing
strength of MoneyGram's money transfer business and adequate,
short-term liquidity position. The company has $1.5 billion of
cash available to meet the ongoing cash needs associated with the
Payment Systems business and other operations.
The CreditWatch Negative listing reflects the potential for
further negative ratings action as events unfold. For example,
the recapitalization agreement may not be implemented as currently
envisioned because, for instance, the closing conditions are not
met. Additional factors that may trigger further downgrades
include higher-than-expected losses, an inability to obtain
further amendments and waivers to bank lending agreements and a
primary clearing agreement after Jan. 31, 2007, and adverse
regulatory actions by state regulatory bodies.
Any agreement with Thomas H. Lee Partners will allow MoneyGram's
board to consider alternative offers, which may be consummated
after the payment of a break-up fee. This includes ongoing
discussions with Euronet Worldwide Inc. (BBB/Watch Pos/--), with
whom MoneyGram recently signed a confidentiality agreement. The
initial CreditWatch Negative listing was predicated on Euronet
potentially acquiring MoneyGram. Although both entities are
currently rated the same, the rating on a combined entity may
differ.
MORGAN STANLEY: Fitch Affirms 'BB+' Rating on $14MM Certs.
----------------------------------------------------------
Fitch Ratings affirms Morgan Stanley Dean Witter Capital I Trust
commercial mortgage pass-through certificates, series 2003-HQ2 as:
-- $140.8 million class A-1 at 'AAA';
-- $522.2 million class A-2 at 'AAA';
-- Interest Only classes X-1 and X-2 at 'AAA';
-- $39.6 million class B at 'AAA';
-- $41.9 million class C at 'AA-';
-- $9.3 million class D at 'A';
-- $9.3 million class E at 'A-';
-- $10.5 million class F at 'BBB';
-- $8.2 million class G at 'BBB-';
-- $14.0 million class H at 'BB+'.
Fitch does not rate classes J, K, L, M, N, and O.
The affirmations are the result of stable pool performance since
Fitch's last rating action. As of the December 2007 distribution
date, the pool's aggregate principal balance has decreased 12.3%
to $818.5 million compared to $931.6 million at issuance. Eleven
loans (15.8%) have defeased since issuance. There are currently
no delinquent or specially serviced loans.
Five loans (42.1%) were shadow rated investment grade at issuance,
one of which has paid in full. All shadow ratings remain
investment grade.
1290 Avenue of the Americas (20%) is secured by a 43-story class A
office building totaling 2 million square feet, located in midtown
Manhattan, New York. The whole loan was divided into four pari
passu notes and a subordinate B-note. The
$130 million A-4 and the $35.0 million A-5 notes serve as
collateral in the subject transaction. Occupancy as of September
2007 is 100% compared to 98.7% at issuance.
Oakbrook Center (9.4%) is secured by the fee interest in 942,039
square feet of owned retail space, 240,223 sf of office space in
three buildings, and the ground leases for a 172-room Renaissance
Hotel, Nordstrom, Neiman Marcus, and a Bloomingdale's Home Store
in Oak Brook, Illinois. The whole loan was divided into three
pari passu notes. Occupancy as of September 2007 is 99% compared
to 94.3% at issuance.
52 Broadway (6.9%) is secured by a 399,935 sf single tenant office
property in New York City. The property was 100% occupied as of
September 2007, in line with issuance.
TruServ Portfolio I (3.1%) is secured by three industrial
properties located in Springfield, Oregon, Fogelsville,
Pennsylvania, and Kingman, Arizona. As of September 2007, the
portfolio is 100% occupied, in line with issuance.
MORGAN STANLEY: S&P Keeps B+ Rating on $3 Mil. Class A-3 Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' rating on the
$3 million class A-3 secured fixed-rate notes from Morgan Stanley
ACES SPC's series 2006-8 and removed it from CreditWatch, where it
was placed with negative implications on May 4, 2007.
The rating action reflects the Jan. 15, 2008, affirmation of the
ratings on Cablevision Systems Corp.'s senior unsecured debt and
their removal from CreditWatch negative.
Morgan Stanley ACES SPC's $46 million secured fixed-rate notes
series 2006-8 is a credit-linked note transaction. The rating on
each class of notes is based on the lowest of:
(i) the ratings on the respective reference obligations for each
class (with respect to class A-3, the senior notes issued by
Cablevision Systems Corp. {'B+'});
(ii) the rating on the guarantor of the counterparty to the credit
default swap, the interest rate swap, and the contingent forward
agreement (in each instance, Morgan Stanley {'AA-'}); and
(iii) the rating on the underlying securities, BA Master Credit
Card Trust II's class A certificates from series 2001-B due 2013
('AAA').
MTI TECHNOLOGY: Thomas Raimondi Resigns as Chairman of the Board
----------------------------------------------------------------
MTI Technology Corp. disclosed in a regulatory filing with the
U.S. Securities and Exchange Commission that effective as of
Dec. 31, 2007, Thomas P. Raimondi, Jr. resigned as chairman of the
Board of Directors and each of William Atkins, Lawrence P. Begley,
Franz L. Cristiani, Ronald E. Heinz, Jr. and Kent D. Smith
resigned as members of the Board of Directors.
The company added that Messrs. Raimondi, Atkins, Begley,
Cristiani, Heinz and Smith did not resign as a result of any
disagreement with the company on any matter relating to the
company's operations, policies or practices.
Mr. Raimondi will continue, however, to serve as the company's
chief executive officer and president.
Headquartered in Tustin, California, M.T.I. Technology Corp. --
http://www.mti.com/-- provides professional services and data
storage for mid- to large-sized organizations. In addition, the
company owns all of the issued and outstanding share capital of
three European subsidiaries: MTI Technology GmbH in Germany, MTI
Technology Limited in Scotland and MTI France S.A.S. in France.
The company filed for Chapter 11 protection on Oct. 15, 2007
(Bankr. C.D. Calif. Case No. 07-13347). Scott C. Clarkson, Esq.,
at Clarkson, Gore & Marsella, A.P.L., represents the Debtor.
Omni Management Group LLC serves as the Debtor's claim, noticing
and balloting agent. The U.S. Trustee for Region 16 appointed
nine creditors to serve on an Official Committee of Unsecured
Creditors in the Debtor's case. As of July 7, 2007, the Debtor
had total assets of $64,002,000 and total debts of $58,840,000.
NATIONAL FARM: Files Schedules of Assets and Liabilities
--------------------------------------------------------
National Farm Financial Corp. filed with the U.S. Bankruptcy
Court for the Northern District of California its schedules of
assets and liabilities, disclosing:
Name of Schedules Assets Liabilities
----------------- ------ -----------
A. Real Property
B. Personal Property $6,806
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims
E. Creditors Holding
Unsecured Priority
Claims
F. Creditors Holding
Unsecured Nonpriority
Claims $44,700,681
------ -----------
TOTAL $6,806 $44,700,681
National Farm Financial Corporation is a California based
corporation . The company filed for Chapter 11 protection on Dec.
5, 2007 (Bank. N.D. Ca. Case No. 07-31580). Brian Y. Lee, Esq.
and Justin E. Rawlins, Esq., at Law Offices of Winston and Strawn
represents the Debtor in its restructuring efforts.
NATIONAL FARM: Files List of Two Largest Unsecured Creditors
------------------------------------------------------------
National Farm Financial Corporation submitted to the U.S.
Bankruptcy Court for the Northern District of California a list of
its two largest unsecured creditors, disclosing:
Entity Nature of Claim Claim Amount
------ --------------- ------------
PSM Holding Corp. Judgment Entered $43,000,000
c/o Linda Dakin-Grimm 10/03/07 (at least
Milbank Tweed Hadley and $43,000,000)
McCloy
601 S. Figueroa Street
30th Floor
Los Angeles, CA 90017
Dillingham & Murphy Legal Services $30,000
William F. Murphy, Esq. rendered
225 Bush Street, 6th Floor
San Francisco, CA 94104
National Farm Financial Corporation is a California based
corporation . The company filed for Chapter 11 protection on
Dec. 5, 2007 (Bank. N.D. Ca. Case No. 07-31580). Brian Y. Lee,
Esq. and Justin E. Rawlins, Esq., at Law Offices of Winston and
Strawn represents the Debtor in its restructuring efforts.
NEPTUNE CDO: Weak Credit Quality Cues Moody's to Lower Ratings
--------------------------------------------------------------
Moody's Investors Service downgraded ratings of six classes of
notes issued by Neptune CDO IV, Ltd., and left on review for
possible further downgrade ratings of two of these classes of
notes. The notes affected by this rating action are:
Class Description: Class X Senior Amortizing Floating Rate Notes
due October 2013
-- Prior Rating: Aaa
-- Current Rating: Baa3, on review for possible downgrade
Class Description: Class A-2 Senior Floating Rate Notes due
October 2046
-- Prior Rating: A3, on review for possible downgrade
-- Current Rating: B2, on review for possible downgrade
Class Description: Class B Senior Floating Rate Notes due October
2046
-- Prior Rating: Baa3, on review for possible downgrade
-- Current Rating: Ca
Class Description: Class C Senior Floating Rate Notes due October
2046
-- Prior Rating: Ba1, on review for possible downgrade
-- Current Rating: Ca
Class Description: Class D Floating Rate Deferrable Notes due
October 2046
-- Prior Rating: B3, on review for possible downgrade
-- Current Rating: Ca
Class Description: Class E Floating Rate Deferrable Notes due
October 2046
-- Prior Rating: Caa2, on review for possible downgrade
-- Current Rating: Ca
The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence, as reported
by the Trustee on Jan. 4, 2008, of an event of default caused by a
failure of the Class A Overcollateralization Ratio to be greater
than or equal to the required amount pursuant Section 5.1(j) of
the Indenture dated March 29, 2007.
Neptune CDO IV, Ltd. is a collateralized debt obligation backed
primarily by a portfolio of RMBS securities and CDO securities.
Recent ratings downgrades on the underlying portfolio caused
ratings-based haircuts to affect the calculation of
overcollateralization. Thus, the Class A Overcollateralization
Ratio failed to meet the required level.
As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.
The rating downgrades taken reflect the increased expected loss
associated with each tranche. Losses are attributed to diminished
credit quality on the underlying portfolio. The severity of
losses of certain tranches may be different, however, depending on
the timing and choice of remedy to be pursued by certain
Noteholders. Because of this uncertainty, the ratings assigned to
the Class X Notes and the Class A-2 Notes remain on review for
possible further action.
NEW CENTURY: Court Amends XRoads Appointment Order
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has amended
the Appointment Order with respect to XRoads Case Management
Services LLC, to include the representation of New Century
Warehouse Corporation, nunc pro tunc to Aug. 3, 2007. All other
terms of the XRoads Appointment order will remain in effect.
As reported in the Troubled Company Reporter on Apr. 20, 2007,
New Century Financial Corporation and its debtor-affiliates
obtained authority from the U.S. Bankruptcy Court for the District
of Delaware to employ XRoads Case Management Services LLC as their
claims and noticing agent.
Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation. The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a plan expires on Jan. 23, 2008. (New
Century Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
NEW CENTURY: Jamie Lisac Appointed as New CFO
---------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission, New Century Financial Corporation disclosed that on
Dec. 19, 2007, Michael Tinsley has resigned as chief
financial officer of NCFC, effective as of Dec. 28, 2007.
NCFC's Board of Directors appointed Jamie Lisac as NCFC's chief
financial officer on Dec. 19, 2007. Mr. Lisac's appointment,
effective as of Dec. 28, 2007, provides that he will not
receive any compensation directly from NCFC, and will not
participate in its employee benefit plans. Mr. Lisac is
independently compensated, pursuant to arrangements between AP
Services LLC and its affiliate, AlixPartners LLP, a financial
advisory and consulting firm specializing in corporate
restructuring.
Holly Etlin, president, chief executive officer and chief
restructuring officer of NCFC, discloses that pursuant to an
agreement between the Debtors and AP Services, the Debtors will
compensate AP Services $565 per hour for Mr. Lisac's services.
Ms. Etlin informs that Mr. Lisac is a director of AlixPartners
since April 2006, and will remain a director of AlixPartners
while serving as the NCFC's chief financial officer.
Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation. The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a plan expires on Jan. 23, 2008. (New
Century Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
NEW CENTURY: Wants Bid Procedures for Sale of Mortgage Loans OK'd
-----------------------------------------------------------------
New Century Financial Corporation and its debtor-affiliates ask
the Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware to approve bidding procedures and bid
protections to GRP Loan LLC, pursuant to the terms and conditions
of an asset purchase agreement dated Dec. 19, 2007, in connection
with the proposed sale of certain assets.
Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, tells the Court that the Debtors seek to
sell 46 mortgage loans that have not been financed through
repurchase agreements, and several of those are secured by a
second position mortgage.
Specifically, 15 Mortgage Loans are secured by property within
the State of Ohio, and subject to a stipulated preliminary
injunction that prohibits their sale, Mr. Samis relates. Through
negotiations with the Ohio Attorney General and the Ohio
Department of Commerce, the Debtors have been permitted to sell
the Ohio Loans.
According to Mr. Samis, the Debtors had contacted Ellington
Capital Management, GRP Financial Services Corp., Midwest First
Financial, Eastern Savings Bank, UBS, Goldman Sachs, and Bayview
Financial, among others, as likely bidders for the Mortgage
Loans. GRP, Midwest, and Bayview were the only parties to submit
bids, and GRP's bid on behalf of the stalking horse bidder was
the highest for the entire pool of the Mortgage Loans.
On Dec. 19, 2007, the Debtors entered into the Asset Purchase
Agreement with GRP, fixing a purchase price of $1,800,000 for the
Mortgage Loans. The terms and conditions of the APA include:
-- the Stalking Horse Bidder's offer will be subject to
potential auction and overbid by competing bidders
submitting higher offers;
-- the purchase agreement states a purchase price determined
by multiplying the aggregate unpaid principal balance of
the Mortgage Loans against a bid price based on the decline
in value of the collateral;
-- in the event that the Stalking Horse Bidder is the
purchaser of the Mortgage Loans, the transaction will close
within two business days after the sale; and
-- in the event that a third-party bidder is the successful
bidder, the Stalking Horse Bidder is entitled a $40,000
break-up fee and a $16,000 reimbursement fee.
The Debtors propose to set Jan. 18, 2008, 12:00 p.m. prevailing
Eastern time, as the deadline to submit competing bids for the
Mortgage Loans. The bidder must, among other things, offer a
purchase price that exceeds GRP's offer by not less than $100,000.
The bidders, except for GRP, are not entitled to seek a break-up
fee or expense reimbursements.
The Auction will start on Jan. 22, 2008, at a time selected by
the Debtors. The Auction will be conducted by telephone
conference, or as determined by the Debtors with notice to the
qualifying bidders. Bids will commence at the highest or best
bid submitted prior to the Auction, and qualified bidders may
then submit successive bids in increments of at least $50,000.
The Debtors ask the Court to schedule a hearing on Jan. 23, 2008,
to consider the sale of the Mortgage Loans to GRP or to the
prevailing bidder at the Auction.
A full-text copy of the GRP Asset Purchase Agreement is available
at no charge at http://researcharchives.com/t/s?271e
The Debtors submit that a prompt sale of the Mortgage Loans
present the best opportunity to maximize the value of the Loans
for the estates. The Debtors believe that, absent a prompt sale,
the value of the Loans will substantially decline.
Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation. The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a plan expires on Jan. 23, 2008. (New
Century Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
NEWPAGE CORP: Closes Plants & Cuts Jobs as Restructuring Continues
------------------------------------------------------------------
NewPage Corporation disclosed key steps being taken to integrate
NewPage and the former Stora Enso North America facilities and
services.
"NewPage is combining its business with SENA with the vision of
becoming the best printing paper company in North America," Mark
A. Suwyn, chairman of the board and chief executive officer of
NewPage, said. "These restructuring decisions will create the
platform essential to become one company, remain competitive in
the marketplace, serve our customers more efficiently and reach
$265 million of synergies we have committed to achieve. Despite
the permanent closures being announced, we are merging the
operations in a manner that will actually increase our 2008 North
American production by 3-8% compared to the combined production in
2007."
"At NewPage, we remain committed to our customers and we will
continue to offer a broad portfolio of printing papers such as
coated freesheet, lightweight coated groundwood, supercalendered
paper and specialty products to meet a wide variety of needs,"
Rick Willett, president and chief operating officer, said. "We
believe our customers will benefit from our closing slower, lower
volume, less strategic machines and moving affected grades to
machines that can manufacture them most efficiently, yielding a
higher quality, more consistent product. Closing one of our
converting facilities and transitioning sheeting operations will
result in better geographical distribution, more capacity for
sheets, faster turnaround and delivery times for custom sizes, and
a wider range of sheet sizes."
The specific restructuring actions are:
* Permanently close the No. 11 paper machine in Rumford, Maine,
which produces coated freesheet and groundwood papers for
magazines and catalogs, by the end of February 2008.
Approximately 60 employees will be affected by the shutdown.
* Permanently close the pulp mill and two paper machines, Nos.
43 and 44, in Niagara, Wisconsin, by the end of April 2008.
The Niagara machines produce 230,000 tons of lightweight
coated groundwood papers used in magazines and catalogs.
Approximately 319 employees will be affected by the shutdown.
* Permanently close the No. 95 paper machine in Kimberly,
Wisconsin, by the end of May 2008. The Kimberly mill
produces coated freesheet papers for publication printing,
and specialty papers for pressure- sensitive or glue-applied
labels. Approximately 125 employees will be affected.
* Permanently close the Chillicothe, Ohio, converting facility
by the end of November 2008 after some of the converting
machines and volume are transferred to existing facilities in
Luke, Maryland, and Wisconsin Rapids, Wisconsin.
Approximately 160 employees will be affected.
Products produced on the closed machines will be transitioned to
more efficient paper machines within the company's integrated mill
system. "In addition to the changes to these operations and their
employees, we are also informing personnel in all areas of the
company such as sales, finance and other support functions of the
longer term plans for their departments," Mr. Suwyn added.
"NewPage is taking appropriate actions to assist the affected
employees with new opportunities or benefits packages."
"These actions come from an extensive integration plan developed
by a group of nearly 50 people from both companies and represent
all the significant actions we expect to take to combine the two
operations. We do not anticipate any further steps related to the
integration," Mr. Willett said. "Right now the market is strong
and we do not anticipate taking any market-related downtime which
would be separate from these actions."
About NewPage
Headquartered in Miamisburg, Ohio, NewPage Corporation --
http://www.newpagecorp.com/-- a wholly owned subsidiary of
NewPage Holding Corporation -- is a U.S. producer of coated papers
in North America. The company produces coated papers in sheets
and rolls with many finishes and weights to offer design
flexibility for a wide array of end uses. With 4,300 employees,
NewPage operates integrated pulp and paper manufacturing mills
located in Escanaba, Michigan; Luke, Maryland; Rumford, Maine; and
Wickliffe, Kentucky; and a converting and distribution center in
Chillicothe, Ohio. The mills have a combined annual capacity of
approximately 2.2 million tons of coated paper.
* * *
As reported in the Troubled Company Reporter on Dec. 11, 2007,
Moody's Investors Service assigned a Ba2 rating to NewPage
Corporation's new $1.6 billion senior secured term loan and a B2
rating to the company's new $456 million second lien notes. At
the same time, Moody's confirmed NewPage's B1 corporate family
rating, the B2 rating on the company's existing second lien notes,
the B3 rating on the company's existing senior subordinated notes,
as well as the company's speculative grade liquidity rating of
SGL-2. The ratings outlook is negative.
Standard & Poor's Ratings Services places its 'BB-' rating to the
proposed $1.6 billion term loan B of NewPage Corp. (B/Stable/--),
based on preliminary terms and conditions. At the same time, S&P
assigned its 'B-' senior secured debt rating and '5' recovery
rating to NewPage's proposed second-lien $456 million add-on fixed
rate notes, based on preliminary terms and conditions.
Standard & Poor's also lowered its ratings on the $225 million
senior secured second-lien floating-rate notes and $350 million
senior secured second-lien fixed-rate notes of NewPage Corp. The
ratings on both issues were lowered to 'B-' from 'B' and removed
from CreditWatch, where they were placed with negative
implications on Sept. 24, 2007.
OCWEN FINANCIAL: Gets $7/Share in Cash Proposal from Investors
--------------------------------------------------------------
Ocwen Financial Corporation's board of directors has received a
proposal from a group of investors led by William C. Erbey,
chairman and chief executive officer of the company, Oaktree
Capital Management L.P. and Angelo, Gordon & Co. L.P. to acquire
all of the outstanding shares of the company for $7 per share in
cash.
The board of directors of the company has formed a special
committee of independent directors to consider the proposal. The
committee has retained Evercore Group, as its independent
financial advisors, and Shearman & Sterling LLP, as its legal
counsel, to assist it in its work.
The board of directors cautions the company's stockholders and
others considering trading in its securities that no decisions
have been made by the board with respect to the company's response
to the proposal.
There can be no assurance that any definitive offer will be made,
that any agreement will be executed or that any transaction will
be approved or consummated.
About Ocwen Financial Corporation
Based in West Palm Beach, Florida, Ocwen Financial Corporation
(NYSE:OCN) -http://www.ocwen.com/-- is a provider of servicing
and origination processing solutions to the loan industry. The
company has three segments: Residential Servicing, Ocwen Recovery
Group and Residential Origination Services. In addition to these
business segments, the company reports other items of revenue and
expense in its Corporate Items and Other segment. The company
services residential mortgage loans, the majority of which are
subprime mortgages. Ocwen Recovery Group primarily conducts
collections for owners of delinquent and charged-off receivables
and for a portfolio of unsecured credit card receivables that OCN
acquired during the period 1998 through 2000. Residential
Origination Services segment consists of three components: fee-
based loan processing businesses, trading and investing activities
and subprime loan originations.
* * *
On Jan. 15, 2008, Moody's Investor Service placed Ocwen Financial
Corporation's junior subordinated debt rating at 'Caa1' and senior
unsecured debt rating at 'B2'.
OCWEN FINANCIAL: Investor Proposal Cues Fitch's Evolving Watch
--------------------------------------------------------------
Fitch Ratings has placed Ocwen Financial Corp.'s Long-term Issuer
Default Rating on Rating Watch Evolving signifying that Fitch may
upgrade, downgrade or affirm OCN's ratings once additional
information has been gathered.
Ratings placed on Watch Evolving:
-- Long-term IDR 'B+';
-- Short-term IDR 'B'.
Fitch's rating action follows a proposal by an investor group, led
by the company's current CEO, William Erbey, to acquire all the
outstanding shares of OCN common stock. Although the investor
group is prepared to move quickly, a special committee of
independent directors will consider the non-binding proposal. The
proposed transaction will be financed through a combination of
cash and approximately $150 million financing to repurchase OCN
outstanding debt.
Assuming no material changes to the investor proposal, a new,
private OCN entity emerging at the current rating level is
probable. In addition, Mr. Erbey will remain chairman and CEO,
and senior management is expected to remain largely intact. Fitch
believes that a negative rating action, although possible, is less
likely, as the investor group indicated that the proposed
transaction will likely result in less debt for the company.
However, Fitch believes that lower debt levels alone do not
support a ratings upgrade. Positive rating momentum would be
influenced by OCN demonstrating consistent and reliable earnings
and cash flow without added leverage. Conversely, continued
legislative and regulatory scrutiny of subprime mortgage servicing
and a weaker corporate governance structure are negative rating
considerations.
OPEN MAGNETIC: Case Summary & 425 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Open Magnetic Imaging, Inc.
2200 Commerce Parkway, Suite 100
Weston, FL 33326
Bankruptcy Case No.: 08-10432
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Acosta Family Holdings, Inc. 08-10436
Tesla Management, Inc. 08-10437
University M.R.I. Management, Inc. 08-10438
Tesla, Inc. 08-10440
Boca M.R.I. Management, Inc. 08-10441
The O.M.I. Network, Inc. 08-10442
The O.M.I. Group, Inc. 08-10445
O.M.I. Group II, Inc. 08-10446
HI-REZ Imaging Network, Inc. 08-10447
O.M.I. of Plantation, Inc. 08-10448
O.M.I. of Boynton Beach, Inc. 08-10449
O.M.I. of Wellington, Inc. 08-10451
O.M.I. of Jupiter, Inc. 08-10452
O.M.I. of Jacksonville, Inc. 08-10453
O.M.I. of Aventura, Inc. 08-10454
O.M.I. of Miami Lakes, Inc. 08-10455
O.M.I. of Fort Lauderdale, Inc. 08-10456
O.M.I. of Coral Gables, Inc. 08-10457
O.M.I. of Kendall, Inc. 08-10458
O.M.I. of Aventura II, Inc. 08-10459
O.M.I. of Palm Beach, Inc. 08-10460
O.M.I. of Orange Park, Inc. 08-10461
O.M.I. C.T. of Aventura, Inc. 08-10462
O.M.I. C.T. of Plantation, Inc. 08-10463
O.M.I. C.T. of Fort Lauderdale, Inc. 08-10464
O.M.I. C.T. of Miami Lakes, Inc. 08-10465
Open Magnetic Imaging of West Boca, Ltd. 08-10466
Type of Business: The Debtors provide magnetic resonance services.
Chapter 11 Petition Date:
Court: Southern District of Florida (Fort Lauderdale)
Judge: Raymond B. Ray
Debtors' Counsel: Peter E. Shapiro, Esq.
Shutts & Bowen, L.L.P.
200 East Broward Boulevard, Suite 2100
Fort Lauderdale, FL 33301
Tel: (954) 524-5505
Total Assets Total Debts
------------ -----------
Open Magnetic Imaging, Inc. $1,785,127 $11,621,774
Acosta Family Holdings, Inc. $0 $8,224,579
Tesla Management, Inc. $12,282 $4,893,850
University M.R.I. Management, Inc. $9,975 $4,893,850
Tesla, Inc. $6,567 $4,893,850
Boca M.R.I. Management, Inc. $0 $0
The O.M.I. Network, Inc. $0 $312,798
The O.M.I. Group, Inc. $100 $8,471,515
O.M.I. Group II, Inc. $5,117 $0
HI-REZ Imaging Network, Inc. $1,350 $10,803
O.M.I. of Plantation, Inc. $345,258 $5,134,003
O.M.I. of Boynton Beach, Inc. $152,930 $3,519,669
O.M.I. of Wellington, Inc. $182,702 $5,022,825
O.M.I. of Jupiter, Inc. $217,733 $5,107,962
O.M.I. of Jacksonville, Inc. $183,991 $5,110,630
O.M.I. of Aventura, Inc. $175,825 $5,021,776
O.M.I. of Miami Lakes, Inc. $214,033 $5,075,138
O.M.I. of Fort Lauderdale, Inc. $249,752 $5,077,652
O.M.I. of Coral Gables, Inc. $226,692 $5,021,630
O.M.I. of Kendall, Inc. $202,694 $5,053,778
O.M.I. of Aventura II, Inc. $376,282 $3,381,219
O.M.I. of Palm Beach, Inc. $156,137 $3,528,677
O.M.I. of Orange Park, Inc. $281,471 $3,522,381
O.M.I. C.T. of Aventura, Inc. $195,112 $4,966,079
O.M.I. C.T. of Plantation, Inc. $180,983 $5,052,031
O.M.I. C.T. of Fort Lauderdale, $128,116 $5,033,637
Inc.
O.M.I. C.T. of Miami Lakes, Inc. $145,343 $5,058,832
Open Magnetic Imaging of West Boca, $217,310 $5,092,575
Ltd.
A. Open Magnetic Imaging, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Internal Revenue Service $1,010,708
Philadelphia, PA 19255-0039
Radiology Resources, Inc. $342,483
20423 Street, Road 7,
Suite F6-289
Boca Raton, FL 33498
American Express $337,602
P.O. Box 360001
Fort Lauderdale, FL 33336-0001
SourceOne Healthcare $129,378
Technologies
All Care Consultants, Inc. $110,852
Healthcare Support Staffing $99,012
Y.K.K. Radiology Services, $98,801
Inc.
Schlakman Medical, Inc. $80,136
Radiology Professors, P.A. $74,824
Blue Cross Blue Shield of $54,000
Florida
R.A.D. Imaging, Inc. $52,026
Bacen & Jordan $42,364
Advanced Transportation & $41,474
Interpretation
Office Depot, Inc. $35,536
Dr. Germaine Rodriguez, M.D., $39,202
P.A.
Virtual Imaging, Inc. $33,543
Medstar Systems, L.L.C. $30,880
Rachlin, Cohen & Holtz, L.L.P. $27,440
Florida Unemployment Comp. $26,776
Dell Financial Services $25,290
B. Acosta Family Holdings, Inc's Two Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial M.R.I. Equipment $4,893,850
Services accounts receivable,
20225 Watertowert Boulevard, inventory and other
Suite 400 assets
Brookfield, WI 53045
Seimens Financial Services M.R.I. Equipment $3,330,728
2809 Collections Center Drive accounts receivable,
Chicago, IL 60695 inventory and other
assets
C. Tesla Management, Inc's Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial M.R.I. Equipment $4,893,850
Services accounts receivable,
20225 Watertowert Boulevard, inventory and other
Suite 400 assets
Brookfield, WI 53045
D. University M.R.I. Management, Inc's Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial M.R.I. Equipment $4,893,850
Services accounts receivable,
20225 Watertowert Boulevard, inventory and other
Suite 400 assets
Brookfield, WI 53045
E. Tesla, Inc's Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial M.R.I. Equipment $4,893,850
Services accounts receivable,
20225 Watertowert Boulevard, inventory and other
Suite 400 assets
Brookfield, WI 53045
F. Boca M.R.I. Management, Inc. does not have any creditors who
are not insiders.
G. The O.M.I. Network, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Dell Financial Services $25,290
Payment Processing Center
Chicago, IL 60693
Mallinckrodt, Inc. $7,704
P.O. Box 905835
Charlotte, NC 28290-5835
Sprint $7,196
P.O. Box 88026
Chicago, IL 60680-1206
Solantic $6,090
Stericycle, Inc. $5,999
Cardinal Health $5,806
J.E.A. Electric $5,000
Bracco Diagnostics, Inc. $4,527
Florida Comfort, Inc. $2,832
Atlantic Medical Supply, Inc. $2,375
Florida Power & Light $1,800
Totowa Systems, Inc. $1,500
O.N.B. Office Cleaning $1,042
Service, Inc.
A.T.&T. $1,000
Office Systems Plus $750
General Systems Solutions, $750
Inc.
Personnel Screening Services $535
Courier Center, Inc. $500
Secureone Protection Services, $450
Inc.
Rapid Rooter Sewer & Drain $439
Service
H. The O.M.I. Group, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
All Care Consultants, Inc. $110,852
3333 West Commercial Boulevard
Fort Lauderdale, FL 33309
Advanced Transportation & $41,474
Interpretation
P.O. Box 941056
Miami, FL 33194-1056
Rachlin, Cohen & Holtz, L.L.P. $27,440
1 South East 3rd Avenue
Miami, FL 33131
Dell Financial Services $25,290
Gilsmore Associates, Inc. $11,350
Cardinal Health $5,806
Bracco Diagnostics, Inc. $4,527
E-Z-EM, Inc. $3,537
Atlantic Medical Supply, Inc. $2,375
Federal Express $1,825
Florida Power & Light $1,800
Totowa Systems, Inc. $1,500
Data Distributing, L.L.C. $1,713
Al Hoffer's Pest Protection, $1,318
Inc.
Monster, Inc. $1,249
A.T.&T. $1,000
Office Systems Plus $750
Courier Center, Inc. $500
Secureone Protection Services, $450
Inc.
Rapid Rooter Sewer & Drain $439
Service
I. O.M.I. Group II, Inc. does not have any creditors who are not
insiders.
J. HI-REZ Imaging Network, Inc's Three Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wachovia Bank, N.A. laser camera $9,894
Commercial Loan Payment Center equipment
Atlanta, GA 30374-0502
Broward County Revenue $467
Collector
115 South Andrews Avenue
Fort Lauderdale, FL 33301-1895
Miami-Dade County Tax $442
Collector
140 West Flagler Street
Miami, FL 33130-1575
K. O.M.I. of Plantation, Inc's 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $148,435
P.O. Box 402076
Atlanta, GA 30384-2076
D.D.R. Southeast Fountains, $45,367
L.L.C.
4770 Paysphere Circle
Chicago, IL 60674
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Broward County Revenue $9,893
Collector
S.B. Capital Corp. $7,500
Florida Power & Light $3,400
Bacen & Jordan $2,607
G.E. Walker, Inc. $2,063
Bracco Diagnostics, Inc. $566
Pharmed Group $492
Stericycle, Inc. $375
Direct Data Products $252
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
South Florida Courier Systems $150
Totowa Systems, Inc. $500
L. O.M.I. of Boynton Beach, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $147,703
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Tax Collector, Palm Beach $6,064
County
P.O. Box 3353
West Palm Beach, FL
33402-3353
Max Developers $5,812
McKesson Specialty $3,167
Distributors
Florida Power & Light $2,300
Bacen & Jordan $1,798
G.E. Walker, Inc. $750
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Data Distributing, L.L.C. $470
Direct Data Products $470
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
South Florida Courier $75
Systems
M. O.M.I. of Wellington, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $83,522
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Crestwood Square, Ltd. $16,311
P.O. Box 861844
Orlando, FL 32886-1844
Tax Collector, Palm Beach $3,997
County
Florida Power & Light $2,500
Bacen & Jordan $1,145
G.E. Walker, Inc. $1,012
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Palm Beach County Water $150
Utilities Department
South Florida Courier $100
Systems
Federal Express $75
Crystal Springs Water Co. $75
N. O.M.I. of Jupiter, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $141,203
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $25,548
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Shoppes at Jonathan's $7,482
Landing, Inc.
Attention: Equity One
Realty Management
Palm Beach Gardens, FL
33408
Tax Collector, Palm Beach $7,062
County
S.B. Capital Corp. $5,000
Florida Power & Light $2,900
Bacen & Jordan $1,798
G.E. Walker, Inc. $1,263
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Data Distributing, L.L.C. $458
Direct Data Products $458
Franklin Business Systems $447
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Medgrade, L.L.C. $150
South Florida Courier $75
Systems
O. O.M.I. of Jacksonville, Inc's 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $139,728
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $42,290
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Rogozinski Properties $9,180
3716 University Boulevard
South
Jacksonville, FL 32216
Duval County Tax Collector $7,500
J.E.A. Electric $5,000
Invivo Diagnostic Imaging $1,500
G.E. Walker, Inc. $642
Totowa Systems, Inc. $500
Bracco Diagnostics, Inc. $566
Stericycle, Inc. $375
Solantic $350
W.W. Gay Mechanical $268
Contractor, Inc.
Secureone Protection $225
Services, Inc.
Pharmed Group $246
Bacen & Jordan $204
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Medgrade, L.L.C. $150
P. O.M.I. of Aventura, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $83,772
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
D.&M. Investments, Inc. $5,639
Royal Oaks Plaza, Inc. $5,017
S.B. Capital Corp. $5,000
Attention: Finance Department
Montville, NJ 07045-1000
Bacen & Jordan $4,275
Florida Power & Light $3,925
Miami-Dade County Tax Collector $3,038
G.E. Walker, Inc. $1,275
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Data Distributing, L.L.C. $153
Courier Center $150
Medgrade, L.L.C. $150
South Florida Courier $100
Systems
Q. O.M.I. of Miami Lakes, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $83,833
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
S.B. Capital Corp. $10,000
Attention: Finance Department
Montville, NJ 07045-1000
Royal Oaks Plaza, Inc. $5,017
Miami-Dade County Tax Collector $4,590
Bacen & Jordan $3,117
Florida Power & Light $1,650
Luis Rodriguez $1,080
G.E. Walker, Inc. $667
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Pharmed Group $492
Stericycle, Inc. $375
Direct Data Products $252
Data Distributing, L.L.C. $252
Franklin Business Systems $195
South Florida Courier $150
Systems
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
R. O.M.I. of Fort Lauderdale, Inc's 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $83,214
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Weingarten Nostat, Inc. $11,844
P.O. Box 201692
Houston, TX 77216-1692
Broward County Revenue $8,836
Collector
S.B. Capital Corp. $5,000
Florida Power & Light $1,500
Bacen & Jordan $1,365
G.E. Walker, Inc. $620
Bracco Diagnostics, Inc. $566
Franklin Business Systems $561
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Roto-Rooter Services Co. $145
Direct Data Products $128
S. O.M.I. of Coral Gables, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $79,491
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
2000 Ponce De Leon Square, $16,638
Inc.
306 Alcazar Avenue
Coral Gables, FL 33134
Miami-Dade County Tax $4,084
Collector
Florida Power & Light $2,500
Federal Express $2,500
Bacen & Jordan $1,190
G.E. Walker, Inc. $648
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Rapid Rooter Sewer & Drain $439
Service
South Florida Courier $100
Systems
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Crystal Springs Water Co. $75
T. O.M.I. of Kendall, Inc's 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial $56,436
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
G.E. Medical Systems $83,726
P.O. Box 402076
Atlanta, GA 30384-2076
Kendall Summit/F.R.E.A.M., $7,084
L.L.C.
Attention: Capital Realty
Coral Gables, FL 33146
McKeeson Specialty $4,179
Distributors
Florida Power & Light $2,500
Bacen & Jordan $1,243
Miami-Dade County Tax $904
Collector
G.E. Walker, Inc. $750
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
South Florida Courier $375
Systems
Stericycle, Inc. $375
Franklin Business Systems $268
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
U. O.M.I. of Aventura II, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Seimens Financial Services M.R.I. equipment, $3,330,728
2809 Collections Center Drive accounts receivable,
Chicago, IL 60695 inventory and other
assets
$42,968
Med-Lab Supply Co., Inc. $136,809
923 Northwest 27 Avenue
Miami, FL 33125
Florida Power & Light $2,500
Tax Collector, Palm Beach $1,384
County
G.E. Walker, Inc. $1,200
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Pharmed Group $492
Stericycle, Inc. $375
Bacen & Jordan $356
Miami-Dade County Tax $210
Collector
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Medgrade, L.L.C. $150
South Florida Courier $150
Systems
McKeeson Specialty $122
Distributors
Banyan International Corp. $75
Federal Express $75
Crystal Springs Water Co. $75
V. O.M.I. of Palm Beach, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Med-Lab Supply Co., Inc. $136,809
923 Northwest 27 Avenue
Miami, FL 33125
Seimens Financial Services $31,529
2809 Collections Center Drive
Chicago, IL 60695
C.F. West Palm Beach $19,583
Office, L.P.
P.O. Box 730328
Dallas, TX 75373-0328
Bacen & Jordan $2,635
Florida Power & Light $2,500
Tax Collector, Palm Beach $1,384
County
G.E. Walker, Inc. $632
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Banyan International Corp. $75
South Florida Courier $75
Systems
Federal Express $75
Crystal Springs Water Co. $75
W. O.M.I. of Orange Park, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Siemens Medical Solutions, $127,305
U.S.A., Inc.
Department AT 40065
Atlanta, GA 31192-0065
Siemens Financial Services $29,042
2809 Collections Center Drive
Chicago, IL 60695
Solantic $5,740
Solantic Jacksonville, L.L.C.
Atlanta, GA 30384-3959
S.B. Capital Corp. $5,000
McKesson Specialty $4,447
Distributors
Jimmy Weeks Tax Collector $3,920
Clay Electric Cooperative, $2,886
Inc.
Florida Comfort, Inc. $2,832
G.E. Walker, Inc. $1,271
O.N.B. Office Cleaning $1,042
Service, Inc.
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Pharmed Group $492
Stericycle, Inc. $375
Bacen & Jordan $317
Secureone Protection $225
Services, Inc.
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Medgrade, L.L.C. $150
X. O.M.I. CT of Aventura, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
G.E. Medical Systems $31,405
P.O. Box 402076
Atlanta, GA 30384-2076
Miami-Dade County Tax $9,666
Collector
140 West Flagler Street
Miami, FL 33130-1575
S.B. Capital Corp. $5,000
D.&M. Investments, Inc. $3,171
G.E. Walker, Inc. $1,374
Florida Power & Light $1,300
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
South Florida Courier $375
Systems
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Banyan International Corp. $75
Crystal Springs Water Co. $75
Federal Express $75
Y. O.M.I. CT of Plantation, Inc's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial $27,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
G.E. Medical Systems $103,086
P.O. Box 402076
Atlanta, GA 30384-2076
Broward Diagnostics, Inc. $11,472
115 South Andrews Avenue
Fort Lauderdale, FL
33301-1895
S.B. Capital Corp. $7,500
Florida Power & Light $1,500
G.E. Walker, Inc. $3,497
McKeeson Specialty $837
Distributors
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Banyan International Corp. $75
Crystal Springs Water Co. $75
Federal Express $75
South Florida Courier Systems $50
Z. O.M.I. CT of Fort Lauderdale, Inc's 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $103,080
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Broward Diagnostics, Inc. $8,836
115 South Andrews Avenue
Fort Lauderdale, FL
33301-1895
S.B. Capital Corp. $5,000
Florida Power & Light $1,500
G.E. Walker, Inc. $748
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
McKeeson Specialty $330
Distributors
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Banyan International Corp. $75
Crystal Springs Water Co. $75
Federal Express $75
South Florida Courier Systems $50
AA. O.M.I. C.T. of Miami Lakes, Inc's 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Healthcare Financial $135,818
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
G.E. Medical Systems $103,080
P.O. Box 402076
Atlanta, GA 30384-2076
S.B. Capital Corp. $10,000
Attention: Finance Department
Montville, NJ 07045-1000
Miami-Dade County Tax $4,590
Collector
McKeeson Specialty $4,169
Distributors
Royal Oaks Plaza, Inc. $2,652
Florida Power & Light $1,200
G.E. Walker, Inc. $636
Bracco Diagnostics, Inc. $566
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
Banyan International Corp. $75
Crystal Springs Water Co. $75
Federal Express $75
AB. Open Magnetic Imaging of West Boca, Ltd's 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G.E. Medical Systems $147,829
P.O. Box 402076
Atlanta, GA 30384-2076
G.E. Healthcare Financial $17,500
Services
20225 Watertower Boulevard,
Suite 400
Brookfield, WI 53045
Boca Mission, L.L.C. $16,494
Charlotte, NC 28260-0478
Bacen & Jordan $4,922
Tax Collector, Palm Beach $3,943
County
Florida Power & Light $2,500
G.E. Walker, Inc. $1,897
Bracco Diagnostics, Inc. $566
Franklin Business Systems $565
Totowa Systems, Inc. $500
Stericycle, Inc. $375
Pharmed Group $246
A.T.&T. $175
Atlantic Medical Supply, Inc. $175
Jeffco, Inc. $175
Courier Center, Inc. $150
Medgrade, L.L.C. $150
South Florida Courier $150
Systems
Roto-Rooter Services Co. $145
Federal Express $75
ORIGEN FINANCIAL: Fitch Retains Junk Ratings on Two Classes
-----------------------------------------------------------
Fitch Ratings has taken rating actions on these Origen Financial,
Inc. manufactured housing contracts, series 2001-A.
-- Class A-5 affirmed at 'A+';
-- Class A-6 affirmed at 'BBB-';
-- Class A-7 affirmed at 'BBB-';
-- Class M-1 remains at 'C/DR4';
-- Class M-2 remains at 'C/DR6'.
The affirmations, affecting approximately $34.6 million of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected losses.
As of the November 2007 distribution date, Fitch expects losses on
the remaining pool balance of 40% for this transaction. When
included with losses already incurred, total cumulative losses as
a percentage of the initial pool balance is expected to be
approximately 39%.
OWNIT MORTGAGE: Two Trust Classes Acquire S&P's Junk Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on two
classes from Ownit Mortgage Loan Trust's series 2004-1.
Concurrently, S&P lowered its ratings on eight classes from
Ownit Mortgage Loan Trust's series 2005-4. Furthermore, S&P
affirmed its ratings on the remaining classes from these two
transactions.
The downgrades of the two classes from series 2004-1 reflect
deterioration in overcollateralization (O/C) due to excessive
realized losses. During the past six remittance periods, losses
have exceeded excess interest by an average of $181,899. Losses
from delinquencies are projected to further reduce credit support.
As of the Dec. 25, 2007, distribution date, total delinquencies
for this transaction were 24.82% of the current pool balance,
while severe delinquencies (90-plus days, foreclosures, and REOs)
were 14.40%. Cumulative realized losses were 0.96% of the
original pool balance.
The downgrades of the eight classes from series 2005-4 reflect a
steady increase in the amount of loans in the severe delinquency
pipeline in combination with a deterioration of credit support due
to excessive realized losses. As of the Dec. 25, 2007,
distribution date, the failure of excess interest to cover monthly
losses reduced O/C to $3.975 million, 17% below its target. Over
the last six remittance periods, the balance of loans that are
severely delinquent has increased $52.616 million to $99.896
million, which is an increase of 111%. Based on the delinquency
pipeline, losses are projected to further reduce credit
enhancement levels. Total delinquencies for this transaction were
39.96% of the current pool balance, while severe delinquencies
were 23.74%. Cumulative realized losses were 0.90% of the
original pool balance.
The affirmations reflect current and projected credit support
percentages that are sufficient to maintain the current ratings.
As of the December 2007 remittance report, credit support for
these transactions was, on average, 29.72% of the current pool
balances. In comparison, current credit enhancement was, on
average, 2.54x of the original levels. As of December 2007, total
delinquencies for these transactions were 24.82% (series 2004-1)
and 39.96% (series 2005-4) of the current pool balances, with
severe delinquencies of 14.40% (series 2004-1) and 23.74% (series
2005-4) of the current pool
balances. Cumulative realized losses were 0.96% (series 2004-1)
and 0.90% (series 2005-4) of the original pool balances.
A combination of subordination, excess interest, and O/C provide
credit enhancement for these transactions. The collateral
supporting these series consists of subprime pools of fixed- and
adjustable-rate mortgage loans secured by first liens on one- to
four-family residential properties.
Ratings Lowered
Ownit Mortgage Loan Trust
Rating
------
Series Class To From
------ ----- -- ----
2004-1 B6 BB BBB
2004-1 B7 CCC BB
2005-4 M3 A AA-
2005-4 M4 BBB- A+
2005-4 M5 BB A
2005-4 M6 B+ A-
2005-4 B-1A, B-1B B BB
2005-4 B-2A, B-2B CCC B
Ratings Affirmed
Ownit Mortgage Loan Trust
Series Class Rating
------ ----- ------
2004-1 M-2 AA+
2004-1 M-3 AA
2004-1 B-1 AA-
2004-1 B-2 A+
2004-1 B-3 A
2004-1 B-4 A-
2004-1 B-5 BBB+
2005-4 A1, A-2A2 AAA
2005-4 A-2B, A-3 AAA
2005-4 M1 AA+
2005-4 M2 AA
2005-4 B-3A, B-3B CCC
2005-4 B-4A, B-4B CCC
PAETEC HOLDING: S&P Holds B Corporate Credit Rating
---------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' bank loan
rating and '5' recovery rating to Fairport, New York-based
competitive local exchange carrier PAETEC Holding Corp.'s proposed
incremental $100 million first lien term loan B due 2013, which
increases the loan to $600 million. The '5' recovery rating
indicates expectations for modest (10%-30%) recovery in the event
of payment default. At the same time, S&P affirmed PAETEC's
ratings, including the 'B' corporate credit rating. The outlook
remains positive.
Proceeds from the term loan along with existing cash on hand will
be used to repay $104 million of outstanding McLeodUSA debt and a
$15 million tender premium for that debt as well as related fees
and expenses. Pro forma operating lease-adjusted debt is about
$1.0 billion. S&P expects to withdraw the ratings on McLeodUSA
Inc. (B-/Negative/--) when the transaction closes.
The rating affirmation reflects the fact that the transaction is
leverage neutral. Pro forma debt to EBITDA is about 3.7x on an
operating lease adjusted basis and including about
$30 million of synergies from the acquisition of McLeodUSA, which
S&P believe are achievable given that they represent only 2% of
the pro forma revenue.
The ratings on PAETEC continue to reflect a vulnerable business
risk profile stemming from significant competition from larger,
better-capitalized regional Bell operating companies and other
competitive local exchange carriers (CLECs); the lack of any
sustainable competitive advantages; integration risks from recent
acquisitions; and low barriers to entry. Tempering factors include
healthy discretionary cash flow, long average contract durations
and low churn, and market diversity.
"We remain concerned that PAETEC's primary competitors, Verizon
Communications Inc. and AT&T Inc., could step up competitive
pressures with more aggressive pricing over the next few years,"
said Standard & Poor's credit analyst Allyn Arden. "We also
expect the cable operators to become more aggressive in targeting
this market in the intermediate term as their own residential
business matures."
PAETEC is not well positioned to combat competitive pressures from
better-capitalized telecommunication providers on a prolonged
basis. Nevertheless, PAETEC benefits from a few positive business
trends that should contribute to moderate growth over the longer
term, including its low market penetration of addressable lines.
PIERRE FOODS: Posts $7.5 Mil. Net Loss in Qtr. Ended December 1
---------------------------------------------------------------
Pierre Foods Inc. disclosed financial results for third quarter
ended Dec. 1, 2007.
The company reported $7.5 million net loss for its third quarter
ended Dec. 1, 2007, compared to $2.8 million net income for the
same period in the previous year.
Items contributing to the net loss include, but are not limited
to:
-- cost of goods sold increased approximately $44.6 million
as a result of the acquisition of Zartic of approximately
$35.3 million, increased sales volume and a change in mix
of approximately $6.2 million, increased prices paid for
raw materials of approximately $6.2 million; and
increased product costs related to product outsourcing as
a result of the destruction of the Hamilton, Alabama
facility of approximately $1 million; partially offset by
decreased sales to two national accounts restaurant
chains of approximately $2.8 million, and other items.
-- selling, general, and administrative expenses increased
approximately $13.8 million as a result of the volume
increase due to the acquisition of Zartic of
approximately $11 million, increased sales volume and a
change in mix of approximately $2.4 million, and
management consulting expenses of approximately
$0.7 million, increased severance expenses, as a result
of the Acquisition of Zartic of approximately
$0.6 million, and increased demonstration expenses in the
company's warehouse club division of $0.4 million;
partially offset by other items.
-- interest expense and other income, net increased
approximately $5.5 million as a result of a change in
fair value of interest rate swaps, increased average
borrowing on the company's term loan due to debt incurred
in conjunction with the company's acquisitions of Zartic
and Clovervale, and an increase in average borrowings
under the company's revolving credit facility.
-- depreciation and amortization expense increased
approximately $1.9 million due to the additional
intangible assets and property, plant, and equipment
being amortized and depreciated as a result of the
company's acquisition of Zartic.
Factors contributing to the net loss were partially offset by:
-- net revenues increased approximately $50 million as a
result of the acquisition of Zartic of approximately
$45.3 million, and increased sales volume and mix of
approximately $7.5 million in most of the company's end-
market segments; and net price increases to customers of
approximately $0.5 million; partially offset by decreased
sales to two national accounts restaurant chains of
approximately $3.3 million.
-- income tax expense decreased approximately $5.6 million
as a result of a pre-tax loss during third quarter fiscal
2008 compared to pre-tax income during third quarter
fiscal 2007.
The companyreported a net loss of $20 million during fiscal 2008
compared with net income of $3.6 million during fiscal 2007.
The companyhad capital expenditures totaling $6.5 million for
fiscal 2008 and $6.2 million for fiscal 2007.
At Dec. 1, 2007, the company's balance sheet showed total assets
of $596.43 million, total liabilities of $466.65 million and total
shareholders' equity of $129.78 million.
About Pierre Foods
Headquartered in Cincinnati, Ohio, Pierre Foods Inc. --
http://www.pierrefoods.com/-- manufactures and markets high-
quality, differentiated processed food solutions, focusing on pre-
cooked and ready-to-cook protein products, compartmentalized
meals, and hand-held convenience sandwiches.
* * *
As reported in the Troubled Company Reporter on Oct. 23, 2007,
Moody's Investors Service affirmed these ratings on Pierre Foods
Inc.: (i)B3 corporate family rating; (ii) B3 probability-of-
default rating; (iii) $40 million senior secured revolving credit
facility maturing 2009, at B2 (LGD 3, 35%); (iv) $227 million
senior secured term loan facility maturing 2010, at B2 (LGD 3,
35%); and (v) $125 senior subordinated notes maturing 2012 at Caa2
(LGD 5,87%).
As reported in the Troubled Company Reporter on Oct. 15, 2007,
Standard & Poor's Rating Services affirmed its 'B' corporate
credit rating and other ratings on Pierre Foods Inc. The ratings
were removed from CreditWatch, where they were placed with
negative implications on Sept. 25, 2007. The outlook is negative.
PORTOLA PACKAGING: S&P Junks Corporate Credit Rating
----------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Portola
Packaging Inc., including its corporate credit rating by two
notches to 'CCC' from 'B-'. The outlook is negative.
The downgrade reflects the continuation of weaker-than-expected
operating profitability and cash flow generation during fiscal
year 2007 and the first quarter of 2008, which resulted in
additional deterioration of Portola's weak liquidity position.
Liquidity could deteriorate further during upcoming quarters
because of expected cash outlays for debt service and capital
expenditures coupled with challenging business conditions,
including weak market demand for domestic fresh milk and elevated
plastic resin costs related to higher crude oil and natural gas
prices.
"We could lower the ratings again if Portola is unable to preserve
sufficient availability under its secured revolving credit
facility and begin to substantially improve operating results,"
said Standard & Poor's credit analyst Henry Fukuchi.
The ratings reflect the company's highly leveraged financial
profile, constrained liquidity, modest size of operations, and
narrow product line. Only partially offsetting these negative
factors are defensible niche positions in end markets and
favorable geographic diversity. With annual sales of about
$270 million, San Jose, California-based Portola produces tamper-
evident plastic closures for packaging applications in dairy,
fruit juices, cosmetics, water, and other noncarbonated beverage
and food products.
PRESIDENT CASINOS: Earns $223,000 in Third Quarter Ended Nov. 30
----------------------------------------------------------------
President Casinos Inc. reported net income of $223,000 for the
third quarter ended Nov. 30, 2007, compared with net income of
$10.1 million in the same period ended Nov. 30, 2006.
As of Nov. 30, 2007, the company had sold its St. Louis and Biloxi
operations. As such, revenues for the three-month period ended
Nov. 30, 2006, are classified in discontinued operations. There
were no operating revenues for the three-month period ended
Nov. 30, 2007.
The company had an operating loss of $218,000 during the three-
month period ended Nov. 30, 2007, compared to $491,000 during the
three-month period ended Nov. 30, 2006.
The company incurred reorganization expense of $4,000 during the
three-month period ended Nov. 30, 2007, compared to income of
$10.0 million during the three-month period ended Nov. 30, 2006.
The decrease in reorganization income is primarily the result of
the recognition of a $10.0 million reduction of the Senior
Exchange Notes and the Secured Notes during the three-month period
ended Nov. 30, 2006, as a result of the Settlement Agreement the
company and President Riverboat Casino-Missouri Inc. entered into
wiht Pinnacle Entertainment Inc., the Official Committee of Equity
Holders and Mr. Terrence L. Wirginis, dated as of Oct. 10, 2006.
Income from discontinued operations were $387,000 for the three
months ended Nov. 30, 2007, and $165,000 for the three months
ended Nov. 30, 2006.
At Nov. 30, 2007, the company's consolidated balance sheet showed
$5.2 million in total assets, $3.1 million in total liabilities,
and $2.1 million in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Nov. 30, 2007, are available for
free at http://researcharchives.com/t/s?271d
Going Concern Doubt
As reported in the Troubled Company Reporter on June 21, 2007,
Deloitte & Touche LLP, in St. Louis, Missouri, expressed
substantial doubt about President Casinos Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the years ended Feb. 28,
2007, and 2006. The auditing firm pointed to the company's
recurring losses from continuing operations and absence of any
ongoing revenue producing activities.
About President Casinos
Headquartered in St. Louis, Mo., President Casinos Inc. --
http://www.presidentcasino.com/ -- does not have significant
operations. Prior to Dec. 2006, it was engaged in the ownership
and operation of a dockside gaming casino in St. Louis, Missouri.
President Casinos filed for chapter 11 protection on June 20, 2002
(Bankr. S.D. Miss. Case No. 02-53055). On July 11, 2002,
substantially all of Debtor's other operating subsidiaries filed
for chapter 11 protection in the same Court. The Honorable Judge
Edward Gaines ordered the transfer of President Casino's chapter
11 cases from Mississippi to Missouri. The case was reopened on
Nov. 5, 2002 (Bankr. E.D. Mo. Case No. 02-53005). Brian Wade
Hockett, Esq., at Hockett Thompson Coburn LLP, represents the
Debtors in their restructuring efforts. David A. Warfield, Esq.,
at Blackwell Sanders Peper Martin LLP, represents the Official
Committee of Unsecured Creditors. Thomas E. Patterson, Esq., and
Ronn S. Davids, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP and
E. Rebecca Case, Esq., and Howard S. Smotkin, Esq., at Stone,
Leyton & Gershman, P.C., represent the Official Committee of
Equity Security Holders.
The company's business activities currently consist of
managing its existing litigation matters, discharging its
liabilities and administering the bankruptcy reorganization plans
of its former Biloxi and St. Louis operations.
PUBLICARD INC: Court Confirms Amended Plan of Reorganization
------------------------------------------------------------
The United States Bankruptcy Court for the Southern District
of New York confirmed the Amended Chapter 11 Plan of
Reorganization filed PubliCARD Inc.
The Court had previously approved on Nov. 29, 2007, the Debtor's
Amended Disclosure Statement describing the Amended Plan.
Under the Plan, the 500 Group, LLC, an entity currently controlled
by PubliCARD's Chief Executive Officer, Joseph E. Sarachek, will
contribute $500,000 to the Reorganized Debtor. In exchange for
the contribution, The 500 Group, LLC will receive 90% of the
Reorganized Debtor's common stock. Holders of PubliCARD's
existing common and preferred stock will each receive 5% of the
Reorganized Debtor's common stock.
Proceeds of The 500 Group, LLC's contribution will be used to:
-- fund the Reorganized Debtor which will change its name from
PubliCARD to Chazak Value Corp., a Delaware Corporation, to
pay allowed administrative expenses;
-- pay allowed priority claims; and
-- provide $60,000 to pay allowed general unsecured claims.
Holders of general unsecured claims will receive an approximate
17% recovery.
On the effective date of the Plan, a new Board of Directors will
be installed for the reorganized Debtor consisting of:
-- Joseph Sarachek
-- Charles Fisch
-- Jonathan Lewis
-- Roger Ehrenberg
-- David Marcus
Headquartered in New York, PubliCARD Inc. fka Publicker Inc. is a
smart card technology company that provides products and solutions
to facilitate secure access and transactions. PubliCARD also
licenses smart card reader technology and the integrated circuit
technology within readers. filed a chapter 11 petition on May 17,
2007 (Bankr. S.D.N.Y. Case No. 07-11517). David C. McGrail, Esq.,
at the Law Offices of David C. McGrail in New York represents the
Debtor in its restructuring efforts. As of Nov. 30, 2007, the
company's balance sheet showed total assets of $26,206, total
liabilities of $505,926.
QLT INC: Board Gives "Go" Signal to Sell Unit and Cut Jobs
----------------------------------------------------------
QLT Inc. said Wednesday that following a months-long business and
portfolio review, its Board of Directors has decided to implement
several new initiatives designed to enhance shareholder value.
These initiatives include:
-- The sale of QLT USA, Inc. whose primary assets include the
Eligard(R) product line for prostate cancer, Aczone(TM), a
dermatology product for the treatment of acne vulgaris, and
the Atrigel(R) drug delivery system, either in a single
transaction or series of transactions;
-- The sale of the land and building associated with and
surrounding the company's corporate headquarters in
Vancouver; and
-- The reduction in headcount of 115 employees with planned
future reductions as assets are divested.
Special Committee Explores Sale of All Assets
As part of its ongoing business and portfolio review, the Board of
Directors announced on Nov. 28, 2007, that it had formed a Special
Committee for the purpose of exploring alternative ways to
maximize shareholder value, including transactions involving the
sale of all or part of the assets of the company.
The Board of Directors later said on Dec. 11, 2007, that it had
hired Goldman, Sachs & Co. to assist with this evaluation. The
Board of Directors, Special Committee and Goldman, Sachs & Co.
have reviewed a variety of alternatives in pursuing these
initiatives.
The company intends to retain adequate proceeds from these asset
sales in order to repay the outstanding convertible debt in
September 2008. In addition, the company will evaluate options
for the optimal use of the balance of cash proceeds from the asset
sales and will provide updates on these options at the appropriate
time.
"Following a comprehensive review of available options, the QLT
board has concluded that seeking offers for the sale of QLT USA as
a whole or of its assets is a key initial step in executing our
strategy," said Boyd Clarke, QLT's Chairman. "We look forward to
working with our advisors and interested parties to maximize
stockholder value," he added.
New Business Focus
QLT plans to focus its ongoing business primarily on its
Visudyne(R) franchise and its clinical development programs
related to its punctal plug delivery technology and its
photodynamic therapy dermatology technology. The company expects
to achieve these milestones in these three areas:
1) Visudyne: Completion of enrollment in the RADICAL combination
study with six-month results expected in Q4 2008.
2) Drug in Punctal Plugs for Glaucoma: IND filing for the
punctal plug with drug technology and initiation of a
Phase I/II clinical trial in glaucoma patients in H1, with
results on plug retention and drug elution expected by year
end 2008.
3) Photodynamic therapy with Lemuteporfin (QLT00748): Human
proof-of-concept studies for the treatment of moderate to
severe acne expected to be completed in 2008.
The company expects to gain further insight into the strategic
value of these assets as clinical milestones are met. The Board
of Directors will continue to evaluate strategic options regarding
these assets as they progress through their clinical development.
"I look forward to increasing our operational efficiency and
driving our business forward with a clear focus on these three key
programs," commented Bob Butchofsky, President and Chief Executive
Officer. "We are focused on achieving these important clinical
milestones and are excited about their potential to create
significant shareholder value."
About QLT Inc.
QLT Inc. (NASDAQ SM: QLTI) (TSE: QLT) -- http://www.qltinc.com/--
is a global biopharmaceutical company that discovers, develops and
commercializes innovative therapies. Its research and development
efforts are focused on pharmaceutical products for ophthalmology
and dermatology. In addition, it utilizes three unique technology
platforms, photodynamic therapy, Atrigel(R) and punctal plugs with
drugs, to create products such as Visudyne(R) and Eligard(R) and
future product opportunities.
Atrigel is a registered trademark of QLT USA Inc. Visudyne is a
registered trademark of Novartis AG. Eligard is a registered
trademark of Sanofi-aventis.
QUEBECOR WORLD: Fails to Obtain $125 Mil. Financing by Jan. 15
--------------------------------------------------------------
Quebecor World Inc. disclosed that in connection with the waivers
obtained from its banking syndicate and the sponsors of its
securitization program on Dec. 31, 2007, it has not obtained by
Jan. 15, 2008, $125 million of new financing, as had been required
under the terms of the waivers.
The non-satisfaction of this condition of the Dec. 31, 2007 waiver
does not automatically result in the termination of the banking
syndicate's waiver or an acceleration of the maturity of
indebtedness under the company's credit facilities or a cross-
default under other financial instruments of Quebecor World.
Any such termination, acceleration or default would require formal
notification from a majority of the banking syndicate to Quebecor
World. The non-satisfaction of this condition of the Dec. 31,
2007, waivers also entitles the sponsors under the company's
securitization program to terminate such program, but any such
termination would not, if effected, result in cross-defaults under
any financial instrument of the company.
The company had requested a one week waiver of this condition from
its banking syndicate and securitization sponsors to facilitate
the rescue financing initiative currently underway, but has
declined to pay the significant waiver costs requested by its
banking syndicate for this waiver, as the company believes it must
preserve cash and this payment would not be in the best interests
of all of the company's stakeholders.
The company renewed its request that the banking syndicate provide
a suitable waiver and is awaiting the response.
In addition, Quebecor World dislosed that in light of the rescue
initiative and its current circumstances, it will not make the
$19.5 million payment of interest due Jan. 15, 2008, on its
outstanding $400 million 9.75% Senior Notes due 2015. Under the
terms of the indentures relating to the 9.75% Senior Notes due
2015, failure to pay interest does not result in an immediate
default and the company has 30 days to cure the non-payment.
Quebecor World is working with Quebecor Inc. and Tricap Partners
Ltd. on the rescue financing plan reported on Jan. 14, 2008, and
believes that satisfaction of the conditions of such initiative
would be in the best interests of the companyand all its
stakeholders. There is no assurance all the consents and
approvals to the completion of the rescue financing plan and
recapitalization initiative will be received on a timely basis.
About Quebecor World Inc.
Headquartered in Montreal, Quebec, Quebecor World Inc. (TSX:
IQW)(NYSE:IQW), -- http://www.quebecorworldinc.com/-- provides
market solutions, including marketing and advertising activities,
well as print solutions to retailers, branded goods companies,
catalogers and to publishers of magazines, books and other printed
media. It has 127 printing and related facilities located in
North America, Europe, Latin America and Asia. In the United
States, it has 82 facilities in 30 states, and is engaged in the
printing of books, magazines, directories, retail inserts,
catalogs and direct mail. In Canada it has 17 facilities in five
provinces, through which it offers a mix of printed products and
related value-added services to the Canadian market and
internationally. The company is an independent commercial printer
in Europe with 19 facilities, operating in Austria, Belgium,
Finland, France, Spain, Sweden, Switzerland and the United
Kingdom. In March 2007, it sold its facility in Lille, France.
Quebecor World (USA) Inc. is its wholly owned subsidiary.
* * *
As reported in the Troubled Company Reporter on Nov. 29, 2007,
Standard & Poor's Ratings Services lowered its preferred stock
rating on Quebecor World Inc. two notches to 'C' from 'CCC-'. The
company's other ratings, including the 'B-' long-term corporate
credit rating, remain unchanged. All ratings are on CreditWatch
with negative implications, where they were initially placed
Aug. 9, 2007.
QUEBECOR WORLD: Moves Rescue Financing Term Compliance Deadline
---------------------------------------------------------------
Quebecor World Inc. has extended the deadline for the satisfaction
of certain conditions precedent to the previously disclosed
CDN$400 million rescue financing agreement with Quebecor Inc. and
Tricap Partners Ltd. Quebecor Inc. and Tricap Partners Ltd. have
indicated that they have made progress on the satisfaction of
these conditions and have requested additional time to attempt to
satisfy them. The deadline for these conditions has been moved
from 9:00 p.m. on Jan. 16, 2008 to 9:00 a.m. on Jan. 20, 2008.
Quebecor World continues to work with Quebecor Inc. and Tricap
Partners Ltd. on the rescue financing plan and believes that
satisfaction of the conditions of such initiative would be in the
best interests of the company and all its stakeholders.
There is no assurance all the consents and approvals to the
completion of the rescue financing initiative will be received on
a timely basis.
About Quebecor World Inc.
Headquartered in Montreal, Quebec, Quebecor World Inc.
(TSX: IQW)(NYSE:IQW), -- http://www.quebecorworldinc.com/--
provides market solutions, including marketing and advertising
activities, well as print solutions to retailers, branded goods
companies, catalogers and to publishers of magazines, books and
other printed media. It has 127 printing and related facilities
located in North America, Europe, Latin America and Asia. In the
United States, it has 82 facilities in 30 states, and is engaged
in the printing of books, magazines, directories, retail inserts,
catalogs and direct mail. In Canada it has 17 facilities in five
provinces, through which it offers a mix of printed products and
related value-added services to the Canadian market and
internationally. The company is an independent commercial printer
in Europe with 19 facilities, operating in Austria, Belgium,
Finland, France, Spain, Sweden, Switzerland and the United
Kingdom. In March 2007, it sold its facility in Lille, France.
Quebecor World (USA) Inc. is its wholly owned subsidiary.
QUEBECOR WORLD: Interest Nonpayment Spurs S&P to Give D Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on Montreal-based printing company Quebecor World
Inc. to 'D' from 'CCC'. Standard & Poor's also lowered the rating
on the company's $400 million 9.75% senior unsecured notes due
2015 to 'D' from 'CCC-'. In addition, S&P lowered the rating on
the company's other senior unsecured notes to 'CC' from 'CCC-'.
The preferred stock rating remains unchanged at 'D'. With these
rating actions, S&P also removed the ratings from CreditWatch with
negative implications, where they were placed Aug. 9, 2007.
"The downgrade follows Quebecor World's nonpayment of interest
expense on its $400 million 9.75% senior unsecured notes, due Jan.
15, 2008," said Standard & Poor's credit analyst Lori Harris. "In
the unlikely event that the company makes the payment within the
30-day cure period, we could raise the
ratings," Ms. Harris added.
The interest payments on Quebecor World's remaining senior
unsecured notes remain current, hence S&P hasn't lowered the
ratings on these issues to 'D'. However, S&P will lower the
ratings on these issues should the senior unsecured notes go into
default.
Quebecor World is in default on its $750 million revolving credit
facility because the company was unable to raise the required $125
million by Jan. 15, 2008, which was a condition to the covenant
waiver on Dec. 31, 2007. Although Quebecor World had requested an
extension from the bank group regarding the requirement for $125
million in new funds, it did not receive it. The nonsatisfaction
of this condition does not automatically result in the termination
of the bank group's waiver, an acceleration of the maturity of
indebtedness under the credit facilities, or a cross-default under
Quebecor World's other debt obligations. Any such action would
require formal notification from a majority of the bank group to
Quebecor World.
RADNOR HOLDING: Wants Plan Solicitation Period Extended to Apr. 21
------------------------------------------------------------------
Radnor Holdings Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to extend, until
April 21, 2008, the exclusive period wherein they can solicit
acceptances of their plan of reorganization, the Associated Press
reports.
The Debtors told the Court that they deserve the extension since
they already succeeded in solving major disputes in their case,
such as their fee dispute with the Official Committee of Unsecured
Creditors, the AP says. The resolution of that dispute led to the
filing of their Chapter 11 plan last April 2007.
The Debtors further said that they need more time to modify the
plan with their new owners, and that ending the plan-solicitation
period might invite more costly and time-consuming litigation, the
AP cites the Debtors in their court filings.
About Radnor Holdings
Based in Radnor, Pennsylvania, Radnor Holdings Corporation --
http://www.radnorholdings.com/-- manufactured and
distributed a broad line of disposable food service products in
the United States, and specialty chemicals worldwide.
The Debtor and its affiliates filed for chapter 11 protection on
Aug. 21, 2006 (Bankr. D. Del. Lead Case No. 06-10894). Gregg M.
Galardi, Esq., Mark L. Desgrosseilliers, Esq., Sarah E. Pierce,
Esq., Timothy R. Pohl, Esq., Patrick J. Nash, Jr., Esq., and Rena
M. Samole, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP,
represent the Debtors. The U.S. Trustee recently disbanded the
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they listed total assets of
$361,454,000 and total debts of $325,300,000.
RALI SERIES 2007: Moody's Downgrades Ratings on 17 Tranches
-----------------------------------------------------------
Moody's Investors Service downgraded the ratings of 17 tranches
and has placed under review for possible downgrade the ratings of
12 tranches from 5 deals issued by RALI in 2007. The collateral
backing these classes consists of primarily first lien, fixed and
adjustable-rate, Alt-A mortgage loans.
The ratings were downgraded and placed under review for downgrade
based on higher than anticipated rates of delinquency,
foreclosure, and REO in the underlying collateral relative to
credit enhancement levels. In its re-rating Moody's has also
applied its published methodology updates to the non delinquent
portion of the transactions.
Complete list of rating actions:
Issuer: RALI Series 2007-QA1 Trust
-- Cl. A-4, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa2 on review for possible downgrade,
-- Cl. M-2, Downgraded to Ba2, previously A2,
-- Cl. M-3, Downgraded to B2, previously Baa1,
-- Cl. M-4, Downgraded to B3, previously Baa2,
-- Cl. M-5, Downgraded to Caa3, previously Baa3,
Issuer: RALI Series 2007-QA2 Trust
-- Cl. A-4, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa2 on review for possible downgrade,
-- Cl. M-2, Downgraded to B1, previously A2,
-- Cl. M-3, Downgraded to Caa1, previously Baa1,
-- Cl. M-4, Downgraded to Caa3, previously Baa2,
-- Cl. M-5, Downgraded to C, previously Baa3,
Issuer: RALI Series 2007-QA3 Trust
-- Cl. A-5, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa2 on review for possible downgrade,
-- Cl. M-2, Downgraded to Ba3, previously A2,
-- Cl. M-3, Downgraded to B2, previously Baa1,
-- Cl. M-4, Downgraded to Caa1, previously Baa2,
-- Cl. M-5, Downgraded to Ca, previously Baa3,
Issuer: RALI Series 2007-QA4 Trust
-- Cl. A-2, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa2 on review for possible downgrade,
-- Cl. M-2, Downgraded to Ba3, previously A2,
-- Cl. M-3, Downgraded to B3, previously Baa2,
-- Cl. M-4, Downgraded to Caa3, previously Baa3,
Issuer: RALI Series 2007-QA5 Trust
-- Cl. I-A-2, Currently Aaa on review for possible downgrade,
-- Cl. II-A-2, Currently Aaa on review for possible
downgrade,
-- Cl. III-A-2, Currently Aaa on review for possible
downgrade,
-- Cl. M-1, Currently Aa2 on review for possible downgrade,
-- Cl. M-2, Downgraded to B1, previously A2,
-- Cl. M-3, Downgraded to B3, previously Baa2.
REGAL ENTERTAINMENT: Fitch Holds 'B+' Issuer Default Rating
-----------------------------------------------------------
Fitch has affirmed its Issuer Default Ratings on Regal
Entertainment Group, Regal Cinemas Corporation at 'B+' and the
individual issue ratings listed below. The affirmation affects
approximately $2 billion of debt at Sept. 27, 2007. The Rating
Outlook is Stable.
Fitch has affirmed these ratings with a Stable Outlook:
Regal Cinemas:
-- IDR at 'B+';
-- Senior secured facility at 'BB/RR2';
-- Senior subordinated notes at 'B/RR5'.
RGC
-- IDR at 'B+';
-- Senior unsecured convertible notes at 'B-/RR6'.
The company announced that it had agreed to acquire Consolidated
Theaters for $210 million in cash. Consolidated is a theater
exhibitor with 28 theaters and 400 screens in Georgia, Maryland,
North Carolina, South Carolina, Tennessee and Virginia. The deal
is expected to close in the first half of 2008. Following the
receipt of proceeds from the IPO of National Cinemedia in 2007 and
prior to the announcement, the company had significant cash
balances that Fitch had anticipated would be used for acquisitions
or other corporate uses and not to repay debt. Regardless of how
the transaction is ultimately financed, Fitch believes the company
has meaningful flexibility at its current rating to make this
acquisition.
The ratings continue to reflect the company's size and position as
a leading theater exhibitor, solid geographic diversity, sound
operating performance, and relatively stable free cash flow
generation. These strengths are balanced by the intermediate term
risks associated with collapsing film distribution windows,
increased competition from at-home entertainment media, heavy
reliance upon a limited number of film distribution companies,
limited control over revenue trends, high operating leverage which
could make theater operators free cash flow-negative in a
downturn, and a history of aggressive dividend payouts.
RGC's liquidity was strong with cash of $382.7 million and
$99.2 million available under the company's $100 million revolver
as of Sept. 27, 2007. The company's maturity schedule is
manageable with less than $35 million due in each of 2008, 2009
and 2010, excluding $123.7 million of convertible notes which are
due
May 15, 2008 and convertible at holder's option. The company's
liquidity is further supported by the working capital dynamics of
the theater exhibition business. At LTM Sept. 30, 2007,
unadjusted leverage was 3.6 times, while adjusted leverage was
5.2x.
In initially establishing the long-term ratings, Fitch heavily
weighed the prospective challenges facing RGC and its industry
peers. We anticipated that movie exhibitors would continue to
consolidate and pursue moderate shareholder friendly activity.
The acquisition of consolidated, announced, is consistent with
Fitch's expectations. Going forward, the company continues to
have flexibility to make acquisitions, invest in the business
organically, and prudently return capital to shareholders.
In terms of the Writers Guild of America strike, Fitch does not
believe the movie exhibitors such as Regal, AMC Entertainment
('B'; Stable Outlook) and Cinemark will be impacted by this strike
over the near-term as they can rely on the lag time between pre-
production and final film release giving them a slate of film
product over the next nine to 12-month period. Obviously, a more
protracted strike could have a negative impact on these entities
as they are solely dependent on the studios product while
maintaining a very high fixed cost base and, generally speaking,
weaker capital structures than companies in other media and
entertainment sub-sectors.
REMOTE MDX: Hansen Barnett Raises Going Concern Doubt
-----------------------------------------------------
Salt Lake City, Utah-based Hansen, Barnett & Maxwell expressed
substantial doubt about the ability of RemoteMDx, Inc., to
continue as a going concern after it audited the company's
financial statements for the year ended Sept. 30, 2007. The
auditor pointed to the company's incurred recurring operating
losses and accumulated deficit.
The company posted a net loss of $26,022,912 on net sales of
$8,570,540 for the year ended Sept. 30, 2007, compared with a net
loss of $23,797,745 on net sales of $1,070,141 in the prior year.
The company incurred cash flows from operating activities of
$11,397,627 for the year ended Sept. 30, 2006. As of Sept. 30,
2007, the company's working capital was $2,596,985. It also had a
net tangible stockholders' equity of $1,625,527 and an accumulated
deficit of $132,749,287.
At Sept. 30, 2007, the company's balance sheet showed $15,284,348
in total assets, $8,672,593 in total liabilities and $1,625,527 in
stockholders' equity.
A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?2716
About RemoteMDx
Headquartered in Sandy, Utah, RemoteMDx Inc. (OTC BB: RMDX.OB) --
http://www.remotemdx.com/-- markets, monitors and sells the
TrackerPAL device. The TrackerPAL is used to monitor convicted
offenders that are on either probation or parole, in the criminal
justice system. The TrackerPAL device utilizes GPS and cellular
technologies in conjunction with a monitoring center that is
staffed 365 days a year.
RENAISSANCE HOME: Public Auction of Securities Set for Feb. 15
--------------------------------------------------------------
AG Delta Holdings LLC and its designee will conduct a public
auction on Feb. 15, 2008, at 11:00 a.m. E.S.T. of:
a) certain real estate investment trust securities consisting of
10 trust certificates issued by Renaissance Home Equity Loan
Trusts; and
b) certain real estate mortgage investment conduit securities
consisting of 4 Class BIO and Class P certificates.
The public auction will be held at:
One World Financial Center
Suite 3900
New York, N.Y. 10281
The aforementioned securities will be sold on an "AS IS, WHERE IS"
basis with no representations and warranties regarding the
Securities.
Initial bids must be submitted by Feb. 1, 2008, at 11:00 a,m.
E.S.T. by fax or e-mail, to:
AG Auction
Bear, Stearns & Co. Inc.
Fax No.: (917) 937-5666
E-mail : agauction@bear.com
RESIDENTIAL ACCREDIT: Moody's Downgrades Ratings on 25 Tranches
---------------------------------------------------------------
Moody's Investors Service downgraded the ratings of twenty five
tranches and has placed under review for possible downgrade the
ratings of one tranche from ten transactions issued by Residential
Accredit Loans, Inc. in 2007. The collateral backing these
classes primarily consists of first lien, adjustable-rate
negatively amortizing Alt-A mortgage loans.
The ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels. In
its analysis Moody's has also applied its published methodology
updates to the non-delinquent portion of the transactions.
Complete rating actions are:
RALI Series 2007-QH1 Trust
-- Cl. M-5, Downgraded to A3, previously A2,
-- Cl. M-6, Downgraded to Baa2, previously Baa1,
-- Cl. M-7, Downgraded to Ba2, previously Baa3,
RALI Series 2007-QH2
-- Cl. M-6, Downgraded to Baa1, previously A3,
-- Cl. M-7, Downgraded to Baa3, previously Baa2,
RALI Series 2007-QH3 Trust
-- Cl. M-7, Downgraded to A3, previously A2,
-- Cl. M-8, Downgraded to Baa2, previously Baa1,
-- Cl. M-9, Downgraded to Ba1, previously Baa3,
RALI Series 2007-QH4 Trust
-- Cl. M-6, Downgraded to A3, previously A2,
-- Cl. M-7, Downgraded to Baa3, previously Baa1,
-- Cl. M-8, Downgraded to Ba1, previously Baa3,
-- Cl. B, Downgraded to Ba3, previously Ba2,
RALI Series 2007-QH5 Trust
-- Cl. M-7, Downgraded to Baa3, previously Baa1,
-- Cl. M-8, Downgraded to Ba2, previously Baa3,
RALI Series 2007-QH6 Trust
-- Cl. M-5 Currently Aa3, on review for possible downgrade,
-- Cl. M-6, Downgraded to A3, previously A1,
-- Cl. M-7, Downgraded to Baa2, previously A3,
-- Cl. M-8, Downgraded to Ba3, previously Baa3,
-- Cl. B, Downgraded to B1, previously Ba3,
RALI Series 2007-QO1 Trust
-- Cl. M-9, Downgraded to Baa3, previously Baa2,
-- Cl. B, Downgraded to Ba3, previously Ba1,
RALI Series 2007-QO2 Trust
-- Cl. M-9, Downgraded to Baa3, previously Baa2,
-- Cl. B, Downgraded to Ba3, previously Ba1,
RALI Series 2007-QO3 Trust
-- Cl. M-9, Downgraded to Ba1, previously Baa3,
RALI Series 2007-QO4 Trust
-- Cl. M-8, Downgraded to Baa1, previously A3,
-- Cl. M-9, Downgraded to Baa3, previously Baa1.
RESIDENTIAL ACCREDITED: Fitch Chips Ratings on 90 Loan Classes
--------------------------------------------------------------
Fitch Ratings has taken rating actions on these 19 Residential
Accredited Loans Inc. transactions:
RALI, Series 2005-QS3 Pool 1:
-- Class I-A affirmed at 'AAA';
-- Class I-M-1 affirmed at 'AA';
-- Class I-M-2 affirmed at 'A';
-- Class I-M-3 affirmed at 'BBB';
-- Class I-B-1 downgraded to 'B' from 'BB';
-- Class I-B-2 downgraded to 'C/DR4' from 'B'.
RALI, Series 2005-QS3 Pool 2:
-- Class II-A affirmed at 'AAA';
-- Class II-M-1 affirmed at 'AA';
-- Class II-M-2 affirmed at 'A';
-- Class II-M-3 downgraded to 'BB+' from 'BBB';
-- Class II-B-1 downgraded to 'CCC/DR2' from 'BB';
-- Class II-B-2 downgraded to 'CC/DR4' from 'B'.
RALI, Series 2006-QS10:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'AA-' from 'AA', and placed on
Rating Watch Negative;
-- Class M-2 downgraded to 'BBB' from 'A';
-- Class M-3 downgraded to 'B' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B', and removed from
Rating Watch Negative.
RALI, Series 2006-QS12:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BB+' from 'A';
-- Class M-3 downgraded to 'CC/DR3' from 'BBB';
-- Class B-1 downgraded to 'C/DR5' from 'BB', and removed
from Rating Watch Negative;
-- Class B-2 downgraded to 'C/DR5' from 'B', and removed from
Rating Watch Negative.
RALI, Series 2006-QS13 Group 1:
-- Class I-A affirmed at 'AAA';
-- Class I-M-1 downgraded to 'A+' from 'AA';
-- Class I-M-2 downgraded to 'BBB' from 'A', and placed on
Rating Watch Negative;
-- Class I-M-3 downgraded to 'CC/DR3' from 'BBB';
-- Class I-B-1 downgraded to 'C/DR4' from 'BB';
-- Class I-B-2 downgraded to 'C/DR5' from 'B', and removed
from Rating Watch Negative.
RALI, Series 2006-QS13 Group 2:
-- Class II-A affirmed at 'AAA';
-- Class II-M-1 downgraded to 'AA-' from 'AA';
-- Class II-M-2 downgraded to 'BBB-' from 'A';
-- Class II-M-3 downgraded to 'B' from 'BBB';
-- Class II-B-1 downgraded to 'CC/DR3' from 'BB';
-- Class II-B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2006-QS14:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'AA-' from 'AA';
-- Class M-2 downgraded to 'BB+' from 'A';
-- Class M-3 downgraded to 'C/DR3' from 'BBB';
-- Class B-1 downgraded to 'C/DR5' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B', and removed from
Rating Watch Negative.
RALI, Series 2006-QS16:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'AA-' from 'AA', and placed on
Rating Watch Negative;
-- Class M-2 downgraded to 'BBB-' from 'A';
-- Class M-3 downgraded to 'CC/DR3' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B', and removed from
Rating Watch Negative.
RALI, Series 2006-QS17:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BBB-' from 'A';
-- Class M-3 downgraded to 'CC/DR3' from 'BBB';
-- Class B-1 downgraded to 'C/DR5' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B', and removed from
Rating Watch Negative.
RALI, Series 2006-QS18 Group 1:
-- Class I-A, II-A affirmed at 'AAA';
-- Class I-M-1 downgraded to 'A+' from 'AA', and placed on
Rating Watch Negative;
-- Class I-M-2 downgraded to 'BB' from 'A';
-- Class I-M-3 downgraded to 'C/DR4' from 'BBB';
-- Class I-B-1 downgraded to 'C/DR5' from 'BB', and removed
from Rating Watch Negative;
-- Class I-B-2 downgraded to 'C/DR5' from 'B', and removed
from Rating Watch Negative.
RALI, Series 2006-QS18 Group 2:
-- Class III-A affirmed at 'AAA';
-- Class II-M-1 downgraded to 'AA-' from 'AA';
-- Class II-M-2 downgraded to 'BBB+' from 'A';
-- Class II-M-3 downgraded to 'B+' from 'BBB';
-- Class II-B-1 downgraded to 'CC/DR3' from 'BB';
-- Class II-B-2 downgraded to 'C/DR4' from 'B'.
RALI, Series 2007-QS1 Group 1:
-- Class I-A affirmed at 'AAA';
-- Class I-M-1 downgraded to 'A+' from 'AA';
-- Class I-M-2 downgraded to 'BBB' from 'A';
-- Class I-M-3 downgraded to 'B' from 'BBB';
-- Class I-B-1 downgraded to 'C/DR4' from 'BB';
-- Class I-B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS1 Group 2:
-- Class II-A affirmed at 'AAA';
-- Class II-M-1 downgraded to 'A' from 'AA';
-- Class II-M-2 downgraded to 'BB' from 'A';
-- Class II-M-3 downgraded to 'C/DR4' from 'BBB';
-- Class II-B-1 downgraded to 'C/DR5' from 'BB';
-- Class II-B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS2:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BB+' from 'A';
-- Class M-3 downgraded to 'C/DR4' from 'BBB';
-- Class B-1 downgraded to 'C/DR5' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS3:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A' from 'AA';
-- Class M-2 downgraded to 'BB+' from 'A';
-- Class M-3 downgraded to 'C/DR4' from 'BBB';
-- Class B-1 downgraded to 'C/DR5' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS4:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BBB' from 'A';
-- Class M-3 downgraded to 'B' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS5:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BBB+' from 'A';
-- Class M-3 downgraded to 'BB-' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS6:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BBB' from 'A';
-- Class M-3 downgraded to 'B' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
RALI, Series 2007-QS7:
-- Class A affirmed at 'AAA';
-- Class M-1 downgraded to 'A+' from 'AA';
-- Class M-2 downgraded to 'BBB' from 'A';
-- Class M-3 downgraded to 'B' from 'BBB';
-- Class B-1 downgraded to 'C/DR4' from 'BB';
-- Class B-2 downgraded to 'C/DR5' from 'B'.
The affirmations, affecting approximately $8.8 billion of
outstanding certificates, reflect a stable relationship between
credit enhancement and future loss expectations. The downgrades,
affecting approximately $644.7 million in outstanding
certificates, and classes placed on Rating Watch Negative,
affecting approximately $84.9 million of outstanding certificates,
reflect deterioration in the relationship between CE and loss
expectation.
The collateral of the above transactions primarily consists of 30-
and 15-year fixed-rate mortgage loans extended to Alt-A borrowers
and are secured by first liens, primarily on one- to four-family
residential properties. As of the December 2007 distribution
date, the above transactions are seasoned from 7 (2007-QS7) to 33
(2005-QS3) months. The pool factors range from 60% (2005-QS3) to
95% (2007-QS5). GMAC-RFC (rated 'RMS2+' by Fitch) is the master
servicer for all the above transactions.
RESIDENTIAL ASSET: S&P Downgrades Ratings on Three Classes
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on three
classes from Residential Asset Securities Corp.'s series 2003-KS6.
Concurrently, S&P lowered its rating on class B2 from
RASC Series 2005-KS4 Trust to 'CCC' from 'B'. Furthermore, S&P
affirmed its ratings on the remaining classes from these two
transactions.
The downgrades of the three classes from series 2003-KS6 reflect
deterioration in overcollateralization (O/C) due to excessive
realized losses. As of the Dec. 25, 2007, distribution date, the
failure of excess interest to cover monthly losses had reduced O/C
to $1.384 million, 59% below its target. During the past six
remittance periods, losses have exceeded excess interest by an
average of $230,561. Losses from delinquencies are projected to
further reduce credit support. Total delinquencies for this
transaction were 48.83% of the current pool balance, while severe
delinquencies (90-plus days, foreclosures, and REOs) were 32.07%.
Cumulative realized losses were 1.55% of the original pool
balance.
The downgrade of class B2 from series 2005-KS4 reflects a steady
increase in the amount of loans in the severe delinquency pipeline
in combination with a deterioration of credit support due to
excessive realized losses. As of the
Dec. 25, 2007, distribution date, the failure of excess interest
to cover monthly losses had reduced O/C to
$2.300 million, 30% below its target. During the past six
remittance periods, losses have exceeded excess interest by an
average of $120,577. Based on the delinquency pipeline, losses
are projected to further reduce credit enhancement levels. Total
delinquencies for this transaction were 29.52% of the current pool
balance, while severe delinquencies were 18.07%. Cumulative
realized losses were 1.82% of the original pool balance.
The affirmations reflect current and projected credit support
percentages that are sufficient to maintain the current ratings.
As of the December 2007 remittance report, credit support for
these transactions was, on average, 35.80% of the current pool
balances. In comparison, current creditenhancement was, on
average, 2.44x of the original levels. As of December 2007, total
delinquencies for these transactions were 48.83% (series 2003-KS6)
and 29.52% (series 2005-KS4) of the current pool balances, with
severe delinquencies representing 32.07% (series 2003-KS6) and
18.07% (series 2005-KS4) of the current pool balances. Cumulative
realized losses were 1.55% (series 2003-KS6) and 1.82% (series
2005-KS4) of the original pool balances.
A combination of subordination, excess interest, and O/C provides
credit enhancement for these transactions. The collateral
supporting these series consists of subprime pools of fixed- and
adjustable-rate mortgage loans secured by first liens on one- to
four-family residential properties.
Ratings Lowered
Residential Asset Securities Corp.
Rating
------
Series Class To From
------ ----- -- ----
2003-KS6 M1 BB- AA+
2003-KS6 M2 B- A+
2003-KS6 M3 CCC BBB+
RASC Series 2005-KS4 Trust
Rating
------
Class To From
----- -- ----
B2 CCC B
Ratings Affirmed
Residential Asset Securities Corp.
Series Class Rating
------ ----- ------
2003-KS6 A-I, A-II AAA
RASC Series 2005-KS4 Trust
Class Rating
----- ------
A2, A3 AAA
M1 AA
M2 A+
M3 A
M4 A-
M5 BBB+
M6 BBB
M7 BBB-
B1 BB+
RISKMETRICS GROUP: Planned IPO Cues Moody's Rating Review
---------------------------------------------------------
Moody's Investors Service placed the B1 corporate family rating of
RiskMetrics Group Holdings LLC under review for possible upgrade
in connection with an anticipated initial public offering of the
common stock of its parent holding company, RiskMetrics Group,
Inc. Based on an assumed public offering price of $18 per share,
the net proceeds from the offering to the company would be
approximately $164.4 million before any over-allotment option.
Moody's anticipates that RiskMetrics will use the majority of the
net proceeds from the offering to prepay the $125 million second
lien term loan of RiskMetrics Holdings, with the balance available
for general corporate purposes.
Moody's review will focus on the amount of debt repaid with IPO
proceeds and the expected financial policies of the issuer post-
IPO. If the IPO is completed and the second lien term loan is
repaid, then the Corporate Family Rating could be upgraded by one
notch.
The first lien credit facility is currently rated Ba3 or one notch
higher than the B1 Corporate Family Rating. If the company
completes the IPO and repays all the second lien debt, then the
debt capitalization post-IPO will consist entirely of first lien
bank debt. Consequently, post-IPO the ratings on the first lien
bank facility will likely match the CFR rating.
Moody's placed these ratings of RiskMetrics Holdings under review
for possible upgrade:
-- Corporate family rating at B1
Moody's affirmed these ratings:
-- Probability-of-default rating at B1
-- $25 million first lien revolver due 2013, Ba3 (LGD 3, 34%)
-- $300 million first lien term due 2014, Ba3 (LGD 3, 34%)
-- $125 million second lien term loan due 2014, B3 (LGD 5,
87%)-ratings expected to be withdrawn upon completion of
IPO and refinancing.
Based in New York, RiskMetrics Holdings is a leading provider of
risk management and corporate governance products and services to
participants in the global financial markets.
ROUNDY'S SUPERMARKETS: S&P Revises Outlook from Negative to Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services revised the outlook on Roundy's
Supermarkets Inc. to stable from negative and affirmed the 'B+'
corporate credit rating. This action reflects the company's
credit metrics, which have improved to levels adequate for the
current rating, and adequate liquidity. At the same time, S&P
affirmed all other ratings on the Milwaukee, Wisconsin-based
company.
"The stable outlook reflects credit metrics that are consistent
for current ratings," said Standard & Poor's credit analyst Stella
Kapur. S&P could lower the rating if the company engages in an
LBO-financed sale. "We could also downgrade Roundy's if
profitability levels decline due to increased competition in its
core markets," she added, "or if the company engages in additional
debt-financed dividend activity, resulting in weaker credit
metrics."
SAFEVEST GLOBAL: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Safevest Global, LLC
5901 East Mckellips
Mesa, AZ 85215
Bankruptcy Case No.: 08-10073
Chapter 11 Petition Date: January 16, 2008
Court: Southern District of Georgia (Augusta)
Judge: John S. Dalis
Debtors' Counsel: Natashia M. Bush, Esq.
Natashia M. Bush, PC
P.O. Box 204229
Augusta, GA 30917
Tel: (706) 922-5966
Fax: (706) 922-5967
http://www.mycsralawyer.com/
Estimated Assets: $1 million to $10 million
Estimated Debts: $1 million to $10 million
The Debtor did not file a list of 20 largest unsecured creditors.
SALOMON BROTHERS: Moody's Junks Rating on $13.7MM Cert.
-------------------------------------------------------
Moody's Investors Service upgraded these ratings of four classes,
affirmed these ratings of seven classes and downgraded these
ratings of two classes of Salomon Brothers Mortgage Securities
VII, Inc., Commercial Mortgage Pass-Through Certificates, Series
2000-C2:
-- Class A-2, $426,989,296, affirmed at Aaa
-- Class X, Notional, affirmed at Aaa
-- Class B, $33,214,000, affirmed at Aaa
-- Class C, $33,215,000, upgraded to Aaa from A1
-- Class D, $7,815,000, upgraded to Aa2 from A2
-- Class E, $11,723,000, upgraded to A1 from Baa1
-- Class F, $13,677,000, updated to Baa1 from Baa2
-- Class G, $9,769,000, affirmed at Baa3
-- Class J, $13,677,000, downgraded to Caa1 from B3
-- Class K, $5,861,000, downgraded to Caa3 from Caa2
-- Class L, $5,861,000, affirmed at C
-- Class M, $8,792,000, affirmed at C
-- Class N, $3,316,372, affirmed at C
As of the Dec. 18, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 23.8%
to $595.4 million from $781.5 million at securitization. The
Certificates are collateralized by 153 mortgage loans ranging in
size from less than 1.0% to 4.6% of the pool, with the top 10
loans representing 24.6% of the pool. Forty six loans,
representing 35.7% of the pool, have defeased and have been
replaced with U.S. Government securities. There have been
aggregate realized losses of approximately $15.2 million. Nine
loans, representing 7.6% of the pool, are currently in special
servicing. The largest specially serviced loan is Diamond Point
Plaza ($14.4 million - 2.4%), which is discussed below. Moody's
has estimated aggregate losses of approximately $17.2 million for
all of the specially serviced loans. Thirty two loans,
representing 16.9% of the pool, are on the master servicer's
watchlist.
Moody's was provided with year-end 2006 operating results for
92.0% of the performing loans. Moody's loan to value ratio is
91.1% compared to 92.6% at Moody's last full review in October
2006 and compared to 84.2% at securitization. Moody's is
upgrading Classes C, D, E and F due to increased credit support,
defeasance and stable overall pool performance. Moody's is
downgrading Classes J and K due to realized and expected losses
from the specially serviced loans.
The top four non-defeased loans represent 12.7% of the pool. The
largest loan is the 1615 Poydras Street Loan ($27.3 million -
4.6%), which is secured by a 502,000 square foot office building
located in the Warehouse District of New Orleans, Louisiana.
Damage from Hurricane Katrina has been repaired and the property
is fully operational. The largest tenant is FM Services Company,
which occupies 58.0% of the premises under a lease that expires in
April 2011. As of June 2007 the property was 87.8% leased
compared to 89.0% at last review and 94.0% at securitization.
Moody's LTV is 88.4%, compared to 91.2% at last review and
compared to 81.2% at securitization.
The second largest loan is the Western Plaza II Loan
($17.7 million -- 3.0%), which is secured by the borrower's
interest in a 343,000 square foot (collateral is 45,880 square
feet and seven ground lease Pads) strip shopping center located in
Mayaguez, Puerto Rico. The center is anchored by Sam's Club,
Caribbean Cinemas and Pep Boys. The center is also shadow
anchored by a Super Kmart. As of April 2007 the property was
100.0% leased compared to 98.6% at last review and compared to
100.0% at securitization. Moody's LTV is 80.2%, the same as at
last review and compared to 86.4% at securitization.
The third largest loan is the Red Lion Shopping Center Loan ($15.9
million - 2.7%), which is secured by a 225,000 retail center
located 10 miles northeast of downtown Philadelphia, Pennsylvania.
The property is anchored by Best Buy, Staples and Pep Boys. As of
October 2007, the property was 82.8% leased compared to 67.0% at
last review and 92.0% at securitization. The loan is on the
master servicer's watchlist due to a decline in occupancy and a
low debt service coverage ratio. Moody's LTV is 87.9% compared to
in excess of 100.0% at last review and compared to 75.3% at
securitization.
The fourth largest loan is the Diamond Point Plaza Loan
($14.4 million - 2.4%), which is secured by a 251,000 retail
center located in suburban Baltimore, Maryland. The loan was
transferred to special servicing in June 2002 and became REO in
February 2006. The loan was transferred due to the unexpected
vacancy of Sam's Club (subsidiary of Wal-Mart Stores, Inc.;
Moody's senior unsecured rating Aa2 - stable outlook), which went
dark in 2002 although it continues to pay rent (56.0% GLA; lease
expiration January 2009). Ames, formerly the second largest
tenant, also vacated its space prior to its lease expiration. The
property is currently 59.9% leased but only 4.3% occupied. The
Trust was awarded a $22.8 million judgment against the borrower
and its affiliates in December 2005 and successfully won the
appeal in September 2006, defeating the debtors' attempts to have
the judgment overturned. Moody's anticipates a significant loss
upon the resolution of this loan, although the loss could be
partially or substantially mitigated if the special servicer is
successful in its efforts to collect on the judgment.
SCAN INTERNATIONAL: Can Hire ARG LLC as Liquidation Consultants
---------------------------------------------------------------
S.C.A.N. International Inc. obtained authority from the U.S.
Bankruptcy Court for the District of Maryland to employ American
Recovery Group LLC, as its liquidation consultants.
American Recovery is expected to:
a) provide the Debtor with supervision and consulting services
including providing the Debtor with supervisory and
financial personnel with respect to the liquidation;
b) assist the Debtor in developing and implementing a marketing
and advertising strategy and program, including signage and
mailings;
c) provide the Debtor with accounting services and sales
reporting as needed;
d) assist the Debtor in developing markdown and sale
strategies;
e) assist the Debtor in obtaining merchandise in a like kind
and quality to the Debtor's existing inventory, including
goods on consignment from third parties, to augment the
Debtor's inventory and the liquidation sale to
maximize the recovery for unsecured creditors in these
proceedings; and
f) provide such other services as may be set forth in the
agreement or which the parties may determine are necessary
and desirable.
Documents submitted to the Court did not disclose the consulting
firm's fees. The firm has not received any retainer as advance
payment of certain of its services.
Byron Clark, a principal at American Recovery, assures the Court
that the firm does not represent or hold interest that is adverse
to the Debtor's estates.
Based in Columbia, Maryland, S.C.A.N. International Inc. aka
S.C.A.N. Contemporary Furniture -- http://www.scanfurniture.com/-
- sells furniture. It filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. M.D. Case No. 07-23153). Stephen F.
Fruin, Esq., at Whiteford, Taylor & Preston LLP, represents the
Debtor in its restructuring efforts. Alan M. Grochal, Esq., at
Tydings & Rosenberg LLP, represents the Official Committee of
Unsecured Creditors in the Debtor's case. When the Debtor filed
for protection from its creditors, it listed estimated assets and
debts between $1 million and $100 million.
SCAN INTERNATIONAL: Panel Can Hire Tydings & Rosenberg as Counsel
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors in S.C.A.N.
International Inc.'s Chapter 11 case obtained permission from the
U.S. Bankruptcy Court for the District of Maryland to employ
Tydings & Rosenberg LLP, as its counsel.
Tydings & Rosenberg is expected to:
a) advise the Committee with respect to its rights, duties, and
powers;
b) assist and advise the Committee's investigation of the
acts, conduct, assets, liabilities, and financial condition
of the Debtor and other relevant matters;
c) draft pleadings and applications;
d) analyze any Chapter 11 plan filed in the case and
participating in the formulation of a plan;
e) represent the Committee in hearings and proceedings;
f) represent the Committee in collateral litigation before
this Court and other Courts; and
g) perform such other legal services as may be required or in
the best interests of the Committee in accordance with the
powers and duties of the Committee.
Documents submitted to the Court did not disclose the firm's
billing rates.
Alan M. Grochal, Esq., a partner at Tydings & Rosenberg, assured
the Court that the firm does not hold or represent any interest
adverse to the Debtor's estate.
Mr. Grochal can be contacted at:
Alan M. Grochal, Esq.
Tydings & Rosenberg LLP
100 East Pratt Street, 26th Floor
Baltimore, MD 21202
Tel: (410) 752-9700
Fax: (410) 727-5460
http://www.tydingslaw.com/
Based in Columbia, Maryland, S.C.A.N. International Inc. aka
S.C.A.N. Contemporary Furniture -- http://www.scanfurniture.com/-
- sells furniture. It filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. M.D. Case No. 07-23153). Stephen F.
Fruin, Esq., at Whiteford, Taylor & Preston LLP, represents the
Debtor in its restructuring efforts. An Official Committee of
Unsecured Creditors has been appointed in the Debtor's case. When
the Debtor filed for protection from its creditors, it listed
estimated assets and debts between $1 million and $100 million.
SCAN INTERNATIONAL: Taps Keen Consultant as Real Estate Advisor
---------------------------------------------------------------
S.C.A.N. International, Inc. asks the U.S. Bankruptcy Court for
the District of Maryland to employ Keen Consultants, the real
estate division of KPMG Corporate Finance LLC, along with its
wholly owned subsidiary KPMG CF Realty LLC, as its special real
estate advisors.
Keen Consultants will:
a) on request, review pertinent documents and consult with
Debtor's counsel, as appropriate;
b) coordinate with the Debtor the development of due diligence
materials, the cost of which shall be Debtor's sole
responsibility;
c) develop, subject to Debtor's review and approval, a
marketing plan and implement each facet of the marketing
plan;
d) communicate regularly with all prospects and maintain
records of all communications;
e) meet periodically with the Debtor and its professional
advisors in connection with the status of its efforts;
f) work with the attorneys responsible for the implementation
of the proposed transactions, reviewing documents,
negotiating and assisting in resolving any problems which
may arise; and
g) if required, appear in Court during the term of this
retention, to testify or to consult with the Debtor in
connection with the scope of KPMG's engagement.
The Debtor says that given the transactional nature of the firm's
engagement, the firm will not be billing the Debtor by the hour
and will not be keeping records of time spent for professional
services rendered in this case. The firm will be keeping
reasonably detailed descriptions of the services that were
rendered pursuant to its engagement agreement with the Debtor.
Lorie Beers, a managing director at KMPG Corporate Finance,
assures the Court that the firm is disinterested as that term is
defined in Section 101(14) of the U.S. Bankruptcy Code.
Based in Columbia, Maryland, S.C.A.N. International Inc. aka
S.C.A.N. Contemporary Furniture -- http://www.scanfurniture.com/-
- sells furniture. It filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. M.D. Case No. 07-23153). Stephen F.
Fruin, Esq., at Whiteford, Taylor & Preston LLP, represents the
Debtor in its restructuring efforts. An Official Committee of
Unsecured Creditors has been appointed in the Debtor's case. When
the Debtor filed for protection from its creditors, it listed
estimated assets and debts between $1 million and $100 million.
SHORT-TERM ASSET: S&P Puts BB Rating on CreditWatch Negative
------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' rating on
Short-Term Asset Receivables Trust's net lease pass-through
certificates series BC 2000-A on CreditWatch with negative
implications.
The CreditWatch negative placement is due to interest shortfalls
to the class. As of the Jan. 15, 2008, remittance report, the
total accumulated shortfall was $52,626.
According to the remittance report, the shortfall is due to
recurring special servicing fees arising from the transfer of a
loan to the special servicer, LNR Partners Inc., in October 2007.
It is Standard & Poor's understanding that the transfer relates to
a lawsuit filed by the borrower against the tenant occupying a
property in Miami, Florida, as described below, for breach of
lease obligations. The CreditWatch placement will remain in
effect while Standard & Poor's learns more about the lawsuit and
its impact on the transaction, including whether the fees
referenced above will be recovered. If it appears likely that the
fees cannot be recovered, S&P will lower the rating to 'D'.
The transaction is collateralized by two credit-tenant-lease loans
secured by properties in Brea, California, and Miami. The Brea
property is a 576,234-sq.-ft. campus-style office/research-and-
development complex consisting of five buildings built in 1979 and
1984. The Miami property is a
568,032-sq.-ft. campus-style office/research-and-development
complex consisting of five buildings built in 1986 and 1992. The
properties are leased under triple-net bondable lease obligations
guaranteed by Beckman Coulter Inc. (BBB/Negative/NR).
SLI MANAGEMENT: Case Summary & Five Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: SL Management LLC
2301 Tower Drive
Monroe, LA 71201
Bankruptcy Case No.: 08-40143
Chapter 11 Petition Date: January 16, 2008
Court: Northern District of Texas (Ft. Worth)
Judge: Russell F. Nelms
Debtors' Counsel: Eric A. Liepins, Esq.
Eric A. Liepins, P.C.
12770 Coit Road, Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
Fax: (972) 991-5788
http://www.ealpc.com/
Estimated Assets: $4,307,500
Estimated Debts: $3,761,332
Consolidated Debtors' List of Five Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Capital One $500,000
P.O. Box 4539
Houston, TX 77210
Texas Capitol value of security: $65,100
Commercial Loan Division $59,500
PO Box 114318
Dallas, TX 75222-4318
City of Lake Worth unknown
3805 Adam Grubb
Fort Worth, TX 76135
Lake Worth Independent unknown
School District
Tarrant County unknown
SPATIALIGHT INC: Files Voluntary Chapter 7 Petition
---------------------------------------------------
The Board of Directors of SpatiaLight Inc. resolved on Jan. 3,
2008, that it was in the best interests of the company to file a
voluntary petition in the United States Bankruptcy Court pursuant
to Chapter 7 of Title 11 of the United States Code.
The bankruptcy filing decision was made after review of:
-- the company's financial situation and prospects;
-- the company's inability to restructure the outstanding
debts;
-- the company's inability to obtain necessary operational
funding; and
-- the decision of the Securities and Exchange Commission to
file a lawsuit against the company, which lawsuit contains
claims which the company believes to be without merit.
On Jan. 3, 2008, David F. Hakala, as the company's representative,
working with the company's bankruptcy counsel was authorized and
directed to execute and deliver all documents and take all
necessary actions to perfect the filing of a voluntary Chapter 7
bankruptcy case on behalf of SpatiaLight.
As reported in the Troubled Company Reporter on Nov. 15, 2007,
SpatiaLight Inc.'s consolidated balance sheet at Sept. 30, 2007,
showed $5.5 million in total assets and $19.0 million in total
liabilities, resulting in a $13.5 million total shareholders'
deficit.
The company's consolidated balance sheet at Sept. 30, 2007, also
showed strained liquidity with $695,152 in total current assets
available to pay $17.8 million in total current liabilities.
Going Concern Doubt
As reported in the Troubled Company Reporter on March 23, 2007,
Odenberg, Ulakko, Muranishi & Co. LLP, in San Francisco, expressed
substantial doubt about SpatiaLight 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 auditing firm
pointed to the company's recurring operating losses, negative cash
flows from operations, negative working capital position, and
stockholders' deficit.
About SpatiaLight Inc.
Headquartered in Novato, California, SpatiaLight Inc. (OTC BB:
HDTV.OB) -- http://www.spatialight.com/-- manufactures high-
resolution LCoS imagers for use in high-definition display
applications such as rear projection televisions, monitors, front
projection systems, near-to-eye applications, micro-projectors and
other display applications. The company's primary manufacturing
facility is located in South Korea.
SPONGETECH DELIVERY: Earns $8,668 in Second Quarter Ended Nov. 30
-----------------------------------------------------------------
Spongetech Delivery Systems Inc. reported net income of $8,668 on
sales of $278,976 for the second quarter ended Nov. 30, 2007,
versus a net loss of $87,064 on $0 of sales in the corresponding
period ended Nov. 30, 2006.
For the three months period ended Nov. 30, 2007, operating
expenses were $235,198, compared to operating expenses of $87,074
in the corresponding period of 2006. The increase of $148,124 is
the result of an increase in selling, general and administrative
expenses.
At Nov. 30, 2007, the company's balance sheet showed $1,094,702 in
total assets, $273,280 in total liabilities, and $821,422 in total
shareholders' equity.
Full-text copies of the company's financial statements for the
quarter ended Nov. 30, 2007, are available for free at:
http://researcharchives.com/t/s?271b
Going Concern Doubt
Drakeford & Drakeford LLC, in New York, expressed substantial
doubt about Spongetech Delivery Systems Inc.'s ability to continue
as a going concern after auditing the company's financial
statements for the year ended May 31, 2007. The auditing firm
reported that the company has incurred operating losses since the
date of organization and requires additional capital to continue
operations.
As of Nov. 30, 2007, the company had an accumulated deficit of
$3,654,311.
About Spongetech Delivery
Based in New York, Spongetech Delivery Systems Inc. (OTC BB: SPNG)
-- http://www.spongetech.com/-- engages in the design,
production, marketing, and distribution of hydrophilic
polyurethane sponge cleaning and waxing products primarily for
vehicular use in the United States.
STRUCTURED ASSET: Fitch Rates $11.2 Mil. Class B Certs. at BB+
--------------------------------------------------------------
Fitch has rated Structured Asset Securities Corp. $778.9 million
mortgage pass-through certificates, series 2006-BC5 as:
-- $598.9 million classes A1-A5 'AAA';
-- $71.5 million class M1 'AA+';
-- $33.5 million class M2 'AA';
-- $11.2 million class M3 'AA-';
-- $11.6 million class M4 'A+';
-- $17.2 million classes M5 and M6 'A';
-- $9.2 million class M7 'A-';
-- $6.8 million class M8 'BBB+';
-- $8 million class M9 'BBB';
-- $11.2 million class B 'BB+' (144A).
The 'AAA' rating on the senior certificates reflects the 25.00%
total credit enhancement provided by the 8.95% class M1, 4.20%
class M2, 1.40% class M3, 1.45% class M4, 1.20% class M5, 0.95%
class M6, 1.15% class M7, 0.85% class M8, 1.00% class M9, the
privately offered 1.40% class B, as well as the initial 2.45%
overcollateralization.
Fitch believes that the amount of credit enhancement will be
sufficient to cover credit losses, including limited bankruptcy,
fraud and special hazard losses. In addition, the ratings reflect
the quality of the mortgage collateral, the strength of the legal
and financial structures, and the master servicing capabilities of
Wells Fargo Bank, N.A., which is rated 'RMS1' by Fitch.
The aggregate trust consists of 3,811 fixed- and adjustable-rate,
conventional, first and second lien residential mortgage loans,
96.21% of which have original terms to maturity of not more than
30 years and 3.79% of which have original terms to maturity of 40
years. As of the cut-off date (Nov. 1, 2006), the mortgages have
an aggregate principal balance of approximately $798,487,780.
Approximately 32.48% of the mortgage pool is fixed rate and 67.52%
is adjustable. The mortgage pool has a weighted average original
loan-to-value ratio of 81.57%, a weighted average coupon of
8.110%, and a weighted average remaining term of 356 months.
None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws.
The mortgage loans were originated by various originators or
acquired by various originators or their correspondents in
accordance with such originator's respective underwriting
standards and guidelines. The largest percentages of originations
were those made by BNC Mortgage, Inc. (47.27% of the mortgage
pool), Countrywide Home Loans, Inc. (21.60% of the mortgage pool),
People's Choice Home Loans, Inc. (18.95% of the mortgage pool),
and Argent Mortgage Company, LLC (9.91% of the mortgage pool).
SASCO, a special purpose corporation, deposited the loans in the
trust, which issued the certificates. For federal income tax
purposes, an election will be made to treat the trust fund as
multiple real estate mortgage investment conduits.
SUN MICROSYSTEMS: Expects Revenue of $3.6 Bil. in FY 2008 2nd Qtr.
------------------------------------------------------------------
Sun Microsystems Inc. reported on Wednesday preliminary results
for its second quarter of fiscal 2008, which ended Dec. 30, 2007.
Sun expects to report revenues for the second quarter of fiscal
2008 of approximately $3.60 billion, an increase of approximately
1.0% as compared with $3.57 billion for the second quarter of
fiscal 2007. Net bookings for the second quarter of fiscal 2008
were approximately $3.85 Billion, an increase of approximately
7.0% year over year.
Total gross margin as a percent of revenues for the second quarter
of fiscal 2008 is expected to be approximately 48%, an increase of
approximately 3.0 percentage points as compared with the second
quarter of fiscal 2007.
Net income for the second quarter of fiscal 2008 on a GAAP basis
is expected to be in the range of $230 million to $265 million, or
$0.28 to $0.32 per share on a diluted basis, as compared with net
income of $133 million, or $0.15 per share, for the second quarter
of fiscal 2007.
"Our preliminary results for the second quarter reflect solid
execution and continued operational progress," said Jonathan
Schwartz, chief executive officer of Sun Microsystems. "The
future is even brighter today, as evidenced by our agreement to
acquire MySQL, one of the fastest growing players in the
$15 billion database market and a key component of many of the
Web's premier properties such as Facebook, Wikipedia, China Mobile
and Baidu. As the market for open source databases continues its
spectacular growth, we look forward to this acquisition directly
contributing to Sun's growth as the platform of choice for the Web
economy."
About Sun Microsystems Inc.
Headquartered in Santa Clara, California, Sun Microsystems Inc.
(NASDAQ: JAVA) -- http://sun.com/-- provides network computing
infrastructure product and service solutions worldwide. The
company has offices in more than 100 countries.
SUN MICROSYSTEMS: Signs $1 Billion Pact to Acquire MySQL
--------------------------------------------------------
Sun Microsystems Inc. has entered into a definitive agreement
to acquire MySQL AB, an open source database developer, for
approximately $1 billion in total consideration.
According to the company, the acquisition accelerates its
position in enterprise IT to now include the $15 billion
database market.
Following completion of the proposed transaction, MySQL will
be integrated into Sun's Software, Sales and Service
organizations and the company's CEO, Marten Mickos, will be
joining Sun's senior executive leadership team.
In the interim, a joint team with representatives from both
companies will develop integration plans that build upon the
technical, product and cultural synergies and the best business
and product development practices of both companies.
As part of the transaction, Sun will pay approximately
$800 million in cash in exchange for all MySQL stock and assume
approximately $200 million in options.
The transaction is expected to close in late Q3 or early Q4 of
Sun's fiscal 2008. Completion of the transaction is subject
to regulatory approval and other customary closing conditions.
The deal is expected to be accretive to FY10 operating income
on a GAAP basis.
Commenting on the deal, Jonathan Schwartz, CEO and president of
Sun Microsystems, said "[the] acquisition reaffirms Sun's
position at the center of the global Web economy. Supporting
our overall growth plan, acquiring MySQL amplifies our investments
in the technologies demanded by those driving extreme growth and
efficiency, from Internet media titans to the world's largest
traditional enterprises. MySQL's employees and culture, along
with its near ubiquity across the Web, make it an ideal fit with
Sun's open approach to network innovation. And most importantly,
[the] announcement boosts our investments into the communities at
the heart of innovation on the Internet and of enterprises that
rely on technology as a competitive weapon."
MySQL's open source database is widely deployed across all major
operating systems, hardware vendors, geographies, industries and
application types. The complementary product line-ups will
extend MySQL's database reach and are expected to bring new
markets for Sun's systems, virtualization, middleware and storage
platforms.
"The combination of MySQL and Sun represents an enormous
opportunity for users and organizations of all sizes seeking
innovation, growth and choice," said Marten Mickos, CEO, MySQL.
"Sun's culture and business model complements MySQL's own by
sharing the same ideals that we have had since our foundation --
software freedom, online innovation and community and partner
participation. We are tremendously excited to work with Sun and
the millions of members of the MySQL open source ecosystem to
continue to deliver the best database for powering the modern
Web economy."
About MySQL
Headquartered in Cupertino, Calif. and Uppsala, Sweden,
MySQL AB -- http://www.mysql.com/-- develops and supports a
family of high-performance, affordable database products.
The company's flagship offering is 'MySQL Enterprise', a
comprehensive set of production-tested software, proactive
monitoring tools, and premium support services. MySQL has
400 employees in 25 countries.
About Sun Microsystems Inc.
Headquartered in Santa Clara, California, Sun Microsystems Inc.
(NASDAQ: JAVA) -- http://sun.com/-- provides network computing
infrastructure product and service solutions worldwide. The
company has offices in more than 100 countries.
SUN MICROSYSTEMS: S&P Ratings Unaffected by $1 Bil. MySQL Deal
--------------------------------------------------------------
Standard & Poor's Ratings Services's ratings and outlook on Sun
Microsystems Inc. (BB+/Stable/--) are not affected by the
company's recent announcement that it has agreed to acquire MySQL
AB for a total consideration of about $1 billion (consisting of
$800 million in cash and $200 million in options).
The acquisition supports Sun's strategic intent to expand its
position in the open-source software market; MySQL is an open-
source developer of database software.
S&P expects Sun to maintain a moderately leveraged financial
profile and strong liquidity. As of Sept. 30, 2007, leverage was
less than 2x and cash and investments totaled $5.2 billion.
SUSAN JOHNSON: Case Summary & Ten Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Susan I. Johnson
15830 Wilson Road
Newburg, MD 20664
Bankruptcy Case No.: 08-10720
Chapter 11 Petition Date: January 16, 2008
Court: District of Maryland (Greenbelt)
Judge: Thomas J. Catliota
Debtor's Counsel: Kimberly D. Marshall, Esq.
603 Post Office Road
Suite 306
Waldorf, MD 20602
Tel: (301) 893-2311
Fax: (301) 893-0392
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's list of its Ten Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
America's Servicing Company Real property and $308,000
P.O. Box 1820 improvements known ($206,000
Newark, NJ 07101 as 8879 Sparrow Court secured)
Bel Alton, MD 20611
American Hone Mortgage Real property and $229,251
P.O. Box 631730 improvements known ($1,101,500
Irving, TX 75063 as 15830 Wilson secured)
Road, Newburg, MD ($824,000
20664 senior lien)
NASA FCU 2005 Cadillac $39,803
500 Prince Georges Center
Upper Marlboro, MD 20772
2005 Sting Ray Boat $19,760
2006 Dodge Truck $18,967
Target general consumer debt $5,386
HSBC Bank general consumer debt $3,025
Credit One Bank general consumer debt $1,718
CapitalOne Bank general consumer debt $644
MCYDSNB general consumer debt $589
First Premier Bank general consumer debt $462
CapitalOne, N.A. general consumer debt $111
TCO FUNDING: Moody's Holds B2 Rating with Stable Outlook
--------------------------------------------------------
Moody's affirmed the B2 corporate family rating for TCO Funding
Corp. and the Ba3 ratings on its revolving credit facility due
2010 and first lien term loan due 2012. The ratings outlook was
changed to stable from positive, as Moody's understands that the
company's IPO will not occur before the end of the second quarter
of 2008, postponing the prospects of material debt reduction that
had supported the positive outlook. Additionally, the rating
agency noted the company's short-term need to loosen one of its
financial covenants under its first lien credit facilities.
The stable outlook is supported by these:
(1) While the Sept. 30, 2007 adjusted debt to EBITDA leverage,
well in excess of 6x, was high for a B2 rating, Moody's
expects the leverage ratio to decline by the end of 2008
even if the IPO does not materialize. This assumes that
Tensar's operating performance will slightly improve in
2008, driven by the roll-out of new products, continuous
momentum in international sales and manufacturing
efficiencies. However, a key risk to this scenario in
Moody's view is the possible deterioration of the US non-
residential construction market, which could weigh on
Tensar's performance.
(2) Moody's anticipates the company to receive an amendment to
loosen its financial coverage covenant for 2008, therefore
securing adequate liquidity.
Negative pressures could be exerted on the ratings or outlook if:
(1) Tensar is not able to reduce its leverage ratio to a level
close to 6 times by the end of 2008; and
(2) the company's liquidity deteriorates following a financial
covenant breach.
These ratings were affirmed:
-- Revolving credit facility, due 2010, affirmed at Ba3
(LGD2 -- 28%);
-- First lien term loan, due 2012, affirmed at Ba3
(LGD2 -- 28%);
-- Corporate family rating, affirmed at B2;
-- Probability of Default, affirmed at B2.
Headquartered in Atlanta, Georgia, Tensar Corporation offers an
integrated suite of products and services that provide soil
stabilization, earth retention, foundation support, high
performance roadways, and erosion and sediment control. The
company's products and services are utilized by the infrastructure
end markets, including in transportation, commercial, and
industrial construction. Revenues for the trailing twelve month
period ended Sept. 30, 2007 were approximately $220 million.
TELEPACIFIC HOLDINGS: S&P Revises Outlook to Negative
-----------------------------------------------------
Standard & Poor's Rating Services revised its outlook on Los
Angeles, California-based U.S. TelePacific Holdings Corp. to
negative from positive due to concerns about weaker operating
trends and the company's ability to meet near-term covenant
compliance given the step-downs incorporated in the credit
agreement over the next few quarters. At the same time, Standard
& Poor's affirmed the 'B-' corporate credit rating and all other
ratings. TelePacific is a competitive local exchange carrier.
"The outlook revision reflects our expectations for weaker
earnings growth in 2008 because of higher churn, given the
company's exposure to the mortgage and real estate sector in
California and Nevada, and limited headroom under its covenants,
which step down materially over the next year," said
Standard & Poor's credit analyst Allyn Arden.
While TelePacific's churn was around 1.2% over the last few years,
Standard & Poor's expect this figure to be between 1.5% and 2% in
2008. The mortgage and real estate segment represents about 10%
of total revenues. TelePacific's lack of market diversity further
exacerbates its exposure to these areas. Additionally,
TelePacific will have difficulty meeting tightening financial
covenants over the next few quarters given current operating
conditions.
The ratings continue to reflect a vulnerable business risk profile
stemming from significant competition from larger, better-
capitalized incumbent telecom operators, the lack of any
sustainable competitive advantages, low barriers to entry, market
concentration, and a highly leveraged financial profile.
TEXHOMA ENERGY: GLO CPA's Raises Going Concern Doubt
----------------------------------------------------
Houston-based GLO CPA's, LLP, expressed substantial doubt about
the ability of Texhoma Energy Inc., to continue as a going concern
after it audited the company's financial statements for the year
ended Sept. 30, 2007. The auditor reported that the company has
recurring operating losses, negative working capital and is
dependent on financing to continue operations.
The company posted a net loss of $2,187,921 on total revenues of
$1,847,647 for the year ended Sept. 30, 2007, compared with a net
loss of $5,442,536 on total revenues of $2,258,425 in the prior
year.
As of Sept. 30, 2007, the company has total current assets of
$698,105 to pay its total current liabilities of $2,158,745.
At Sept. 30, 2007, the company's balance sheet showed $5,870,138
in total assets and $10,314,025 in total liabilities, and a
stockholders' deficit of $4,443,887.
A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?2718
About Texhoma Energy
Headquartered in Dallas, Texhoma Energy Inc. (Other OTC: TXHE.PK)
engages in the exploration and production of crude oil and natural
gas. It has a 6% participation agreement for the exploration and
development of an area in Louisiana.
TEXAS WESLEYAN: Moody's Keeps Ba2 Rating on Series 1997A Bonds
--------------------------------------------------------------
Moody's Investors Service affirmed the Ba2 rating on Texas
Wesleyan University's Series 1997A bonds issued through the Forth
Worth Higher Education Finance Corporation. At this time, Moody's
is revising its rating outlook to positive from stable based on
continued improvements in enrollment and a strengthened balance
sheet.
Legal security: Payments are a general unsecured obligation of the
University.
Interest Rate Derivatives: None
Strengths
* Growing enrollment in both undergraduate and graduate
programs (2,833 full-time equivalent students in fall 2007,
of which 51.5% are undergraduates compared to 64.7% in 2000).
Transfer students comprise nearly 60% of the University's
entering undergraduate enrollment driven by strategic
relationships with nearby community colleges, including a
dual enrollment program with Hill College.
* Operating performance continues to be positive (4.9% three-
year average operating margin and 12.4% operating cash flow
margin in FY 2007), stemming from healthy enrollment trends
and improved management oversight of budget. Total Net
Tuition Revenue has grown, on average, by 8.5% over the past
three years. Management expects positive performance to
continue in FY 2008 with revenue ahead of projections.
* Liquidity, while still weak (expendable financial resources
of $8.3 million in FY 2007), has improved due to management's
focus on generating positive operating results and on
rebuilding liquidity. The University plans to retain all
unrestricted gifts (typically $600,000-800,000 annually)
instead of using them for operations and has limited
endowment spending to a fixed rate of $2.5 million annually.
In addition, improved investment returns have contributed to
resource growth, with a 16.6% annual return in FY 2007.
Challenges
* Limited liquidity, excluding plant equity, with unrestricted
resources of -$1.3 million in FY 2007. The University's lack
of liquid financial resources and reliance on a line of
credit for seasonal cash flow leaves it vulnerable to
unexpected shifts in demand or financial performance.
* Thin financial resource coverage of debt, with expendable
financial resources covering direct debt by 0.4 times.
Management reports that the Board has authorized $3 million
in debt or internal funds to finance the purchase of
annuities for the University's underfunded and inactive
defined benefit pension plan.
* Highly competitive market, with the University competing with
public universities and regional private higher education
institutions, reflected in the relatively low net tuition per
student of $12,683 when compared to peer institutions,
especially those with significant graduate enrollment. The
competitive environment can potentially limit growth in net
tuition revenues and generation of operating cash flow to
fund strategic program investments, as well as financial
resource growth. However, the University expects that its
net tuition per student will show an increase for FY 2008.
* Highly reliant on student charges, with tuition and auxiliary
revenues comprising 83.3% of operating revenue in FY 2007,
making the University vulnerable to student market
challenges.
Recent Developments
In December 2007, Texas Wesleyan University purchased
$10 million of annuities with equities liquidated from the assets
of the University's inactive defined benefit pension plan. The
annuities purchased in December cover approximately 50% of plan
participants. Management reports plans to purchase an additional
$8 million of annuities in the spring of 2008 to cover the
remainder of plan participants. The additional annuities will be
purchased with $5 million from the remaining assets of the pension
plan and $3 million or either debt or funds of the University.
The plan, which has been closed to new participants since 1996,
was underfunded by $1.4 million at the end of FY 2007. Moody's
includes the difference between the plan assets and projected
benefit obligation as indirect debt of the University.
Outlook
The University's rating outlook is positive reflecting Moody's
expectation for continued net tuition revenue growth and
maintenance of improved operating results contributing to growth
of liquid financial resources.
What Could Change the Rating - Up
Growth in liquidity, from enhanced fundraising or retained
surpluses, along with stability in enrollment and leverage levels
could lead to a rating upgrade.
What Could Change the Rating - Down
Enrollment declines, especially leading to operating deficits,
substantial new borrowing, or reductions to already limited
liquidity could pressure the rating.
Key Data and Ratios (Fiscal year 2007 financial data;
fall 2007 enrollment data)
-- Total Full-Time Equivalent Enrollment (FTE): 2,833
students
-- Total Direct Debt: $20.1 million
-- Total Financial Resources: $38.0 million
-- Unrestricted Financial Resources to Direct Debt: -0.07
times
-- Unrestricted Financial Resources to Operations: -0.03
times
-- Average Actual Debt Service Coverage
(three-year average): 2.5 times
-- Reliance on Student Charges (Tuition and Auxiliary
Revenues): 83.3%
Rated Debt
-- Revenue Bonds, Series 1997A: Ba2
THOMPSON CREEK: Moody's Maintains Corporate Family Rating at B3
---------------------------------------------------------------
Moody's Investors Service affirmed Thompson Creek's B3 corporate
family rating and lowered its first-lien senior secured rating to
B3 (LGD4, 53%) from B2. The one notch downgrade reflects a higher
expected loss driven by the reduction in the amount of junior debt
in Thompson Creek's capital structure. The full repayment of the
$62 million second-lien debt ahead of the first-lien lenders
removed a significant amount of loss absorption cushion and
results in an increase in the loss given default point estimate to
53% from 40%. The corporate family rating is being re-assigned to
the parent, Thompson Creek Metals Company, Inc. from Thompson
Creek Metals Company USA.
Thompson Creek's B3 corporate family rating reflects its singular
concentration in molybdenum, small size, concentration in two
mines, contingency payments of up to $125 million at molybdenum
prices higher than $15/lb., and reliance on fairly significant
volume increases to meet its earnings and cash flow targets. The
B3 rating also considers favorable fundamentals of the molybdenum
market, the long history of mining at Thompson Creek's two
operations, significant debt reduction in 2007, and the absence of
unfunded pension, OPEB and similar liabilities.
Rating Lowered:
-- Senior secured rating to B3 (LGD4, 53%) from B2
Rating Affirmed:
-- Corporate family rating, B3
Moody's last rating action on Thompson Creek was to assign a B3
corporate family rating and rate its 1st and 2nd lien debt B2 and
Caa2, respectively, in September 2006.
Thompson Creek Metals Company Inc., is engaged in the mining and
processing of molybdenum and had revenues of $716 million in the
nine month ended Sept. 30, 2007.
THORNBURG MORTGAGE: Fitch Holds 'BB' Rating on Class B-5 Certs.
---------------------------------------------------------------
Fitch Ratings has taken rating actions on these Thornburg Mortgage
Home Loans mortgage loan pass-through certificates:
Series 2006-3
-- Class A affirmed at 'AAA';
-- Class B-1 affirmed at 'AA+';
-- Class B-2 affirmed at 'AA-';
-- Class B-3 affirmed at 'A';
-- Class B-4 affirmed at 'BBB';
-- Class B-5 affirmed at 'BB'.
The affirmations, affecting approximately $1.3 billion of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss.
The collateral of the above transaction consists of 30-year
adjustable rate mortgage loans extended to prime borrowers and
secured by first-liens on one- to four- family residential
properties. The transaction is master serviced by Wells Fargo
Bank, N.A. (rated 'RMS1' by Fitch).
As of the Dec. 2007 remittance date, the pool factor is 82% and
the transaction is seasoned 18 months.
TIBERIAS INC: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Tiberias Inc.
20955 Pathfinder Road, Suite 100
Diamond Bar, CA 91784
Bankruptcy Case No.: 08-10431
Type of Business: The Debtor engages in advisory and
consultation services.
Chapter 11 Petition Date: January 16, 2008
Court: Central District Of California (Riverside)
Judge: Peter Carroll
Debtors' Counsel: Jonathan R. Ellowitz, Esq.
3700 Newport Boulevard, Suite 105
Newport Beach, CA 92663
Tel: (949) 723-8441
Estimated Assets: $1 million to $10 million
Estimated Debts: $1 million to $10 million
The Debtor does not have any creditors who are not insiders.
TIMBERSTAR TRUST: Fitch Holds 'BB' Rating on $130MM Cl. F Certs.
----------------------------------------------------------------
Fitch affirms TimberStar Trust I, series 2006-1, commercial
mortgage pass-through certificates as:
-- $400,000,000 class A 'AAA';
-- $80,000,000 class B 'AA';
-- $80,000,000 class C 'A';
-- $80,000,000 class D 'BBB';
-- $30,000,000 class E 'BBB-';
-- $130,000,000 class F 'BB'.
The affirmations are due to the stable Fitch calculated value
since issuance. The transaction is a single borrower, interest-
only loan with an Expected Repayment Date of Oct. 15, 2016. As of
the December 2007 distribution date the transaction balance is
$800 million, unchanged since issuance.
Collateral for the loan is a first-priority mortgage lien on
timberlands located in Texas (43% of the total acreage), Louisiana
(31%), and Arkansas (26%).
At issuance total acreage was 989,622 of which 99,993 is
nonmortgage acres considered higher and better use land that is
expected to be sold. Timber growing on the HBU land is pledged as
security for the trust; however, any proceeds from the sale of the
land will not be pledged to the trust. As of November 2007, HBU
has been reduced by 680 acres to 99,313 acres, resulting in total
acreage of 897,942.
The servicer reported November 2007 trailing twelve months debt
service ratio is 1.59 times compared to issuance of 1.41x. The
total harvest volume for this same period was 3.7 million tons
compared to issuance projections of 3.4 million tons.
While the actual 2007 net cash flow is higher than expectations,
Fitch's collateral value is based on a 30-year period. As a
result, Fitch's loan-to-value improved slightly to 72.6% from
76.1% at issuance.
TOUSA INC: Misses Jan. 15 Interest Payment for 7.5% Sr. Notes
-------------------------------------------------------------
TOUSA Inc. failed to make its semi-annual interest payments due
Jan. 15, 2008 under $200 million in principal amount of its 7.5%
Senior Subordinated Notes due 2015.
The failure to pay interest on such Notes within 30 days of the
due date could result in the indebtedness represented by the Notes
becoming immediately due and payable and as a result cause other
indebtedness of the company to be accelerated and become
immediately due and payable.
As reported in the Troubled Company Reporter on Jan. 8, 2008,
TOUSA failed to make its semi-annual interest payments due Jan. 1,
2008, under $300 million in aggregate principal amount of its 9%
Senior Notes due 2010 and $185 million in aggregate principal
amount of its 10-3/8% Senior Subordinated Notes due 2012.
As previously disclosed, the company is considering restructuring
alternatives.
Headquartered in Hollywood. Florida, TOUSA Inc. (NYSE: TOA) --
http://www.tousa.com/-- is a homebuilder in the United States,
operating in various metropolitan markets in 10 states located in
four major geographic regions: Florida, the Mid-Atlantic, Texas,
and the West. TOUSA designs, builds, and markets detached single-
family residences, town homes, and condominiums to a diverse group
of homebuyers, such as "first-time" homebuyers, "move-up"
homebuyers, homebuyers who are relocating to a new city or state,
buyers of second or vacation homes, active-adult homebuyers, and
homebuyers with grown children who want a smaller home. It also
provides financial services to its homebuyers and to others
through its subsidiaries, Preferred Home Mortgage Company and
Universal Land Title Inc.
* * *
As reported in the Troubled Company Reporter on Jan. 8, 2008,
Standard & Poor's Ratings Services lowered its corporate credit
rating on TOUSA Inc. to 'D' from 'CC' and downgraded TOUSA's
$300 million 9.0% senior notes due 2010 and its $185 million
10.375% senior subordinated notes due 2012 to 'D' from 'C' after
the company announced that it had failed to make scheduled
interest payments on these obligations.
Additionally, S&P lowered its rating on TOUSA's senior secured
first-lien term loan to 'CC' from 'CCC-', and S&P affirmed its 'C'
ratings on $575 million of additional unsecured debt and TOUSA's
$300 million senior secured second-lien term loan.
UNICO INC: Nov. 30 Balance Sheet Upside-Down by $6.9 Million
------------------------------------------------------------
Unico Inc.'s consolidated balance sheet at Nov. 30, 2007, showed
$6.5 million in total assets and $13.4 million in total
liabilities, resulting in a $6.9 million total stockholders'
deficit.
At Nov. 30, 2007, the company's consolidated balance sheet also
showed strained liquidity with $67,552 in total current assets
available to pay $13.4 million in total current liabilities.
The company reported a net loss of $3.0 million for the third
quarter ended Nov. 30, 2007, compared with a net loss of
$4.8 million in the corresponding period ended Nov. 30, 2006.
For the three months ended Nov. 30, 2007, and Nov. 30, 2006, Unico
reported $0 revenues.
During the three months ended November 30, 2007 the company
incurred total operating expenses of $399,763, an increase of
$26,430 from the $373,333 of total operating expenses incurred in
the three months ended Nov. 30, 2006.
During the three months ended Nov. 30, 2007, interest expense was
$1.7 million, compared to $905,621 of interest expense incurred in
the three months ended Nov. 30, 2006. Loss on settlement of debt
was $-0- in the three months ended Nov. 30, 2007, compared to
$2.7 million loss on settlement of debt incurred during the three
months ended Nov. 30, 2006. During the three months ended
Nov. 30, 2007, derivative loss on debentures was $844,553 a
decrease of $47,350 from the $891,903 loss on derivative loss on
debentures incurred during the three months ended Nov. 30, 2006.
The company attributes the increase in interest expense primarily
to increases in the amount of convertible debentures issued by the
company. The company attributes the decreases in derivative loss
on debentures to the fact that no debentures were converted to
common stock in the three months ended Nov. 30, 2007, primarily
because the company does not have sufficient authorized, but
unissued shares to permit the conversion of many of the
convertible debentures outstanding.
Full-text copies of the company's consolidated financial
statements for the quarter ended Nov. 30, 2007, are available for
free at http://researcharchives.com/t/s?2714
Going Concern Doubt
As reported in the Troubled Company Reporter on June 15, 2007, HJ
Associates & Consultants LLP, in Salt Lake City, expressed
substantial doubt about Unico Inc.'s ability to continue
as a going concern after auditing the company's financial
statements for the years ended Feb. 28, 2007, and 2006. The
auditing firm pointed to the company's recurring losses from
operations and stockholders' deficit.
About Unico Inc.
Based in San Diego, Calif., Unico Inc. (OTC BB: UCOI.OB) --
http://www.unicomining.com/-- is a publicly traded natural
resource company in the precious metals mining sector that is
focused on the exploration, development and production of gold,
silver, lead, zinc, and copper concentrates at its three mine
properties: the Deer Trail Mine, the Bromide Basin Mine and the
Silver Bell Mine.
VPI ACQUISITION: Case Summary & Two Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: VPI Acquisition Company
222 South Ninth Street, Suite 2880
Minneapolis, MN 55402
Bankruptcy Case No.: 08-40167
Chapter 11 Petition Date: January 15, 2008
Court: District of Minnesota (Minneapolis)
Judge: Dennis D O'Brien
Debtor's Counsel: Michael L Meyer, Esq.
Ravich Meyer Kirkman McGrath Nauman
4545 IDS Center
80 South Eighth Street
Mineapolis, MN 55402
Tel: (612) 317-4745
Fax: (612) 332-8302
Estimated Assets: Less than $50,000
Estimated Debts: $10 Million to $100 Million
Debtor's list of its Two Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
PNC Bank N.A. $11,200,000
1 South Wacker Drive
Chicago, IL 60606
Wells Fargo Bank N.A. $8,300,000
Sixth & Marquette
Minneapolis, MN 55402
WR GRACE: Court Commences Asbestos Estimation Trial
---------------------------------------------------
Estimation trial on W.R. Grace & Co.'s asbestos-related personal
injury claims started on Jan. 14, 2008. The trial aims to
establish the amount of Grace's current and future PI asbestos
liabilities to allow the company to proceed with the confirmation
of its Plan of Reorganization.
The Jan. 14 Estimation Date was scheduled by Judge Judith
Fitzgerald of the U.S. Bankruptcy Court for the District of
Delaware in late July 2007. Judge Fitzgerald oversees Grace's
bankruptcy case.
All of Grace's personal injury issues are handled by Judge Ronald
Buckwalter of the U.S. District Court for the Eastern District of
Pennsylvania. Grace's PI issues were formerly handled by
District Judge Wolin.
Grace, a specialty chemicals and materials company, and 61 of its
affiliates sought protection under Chapter 11 of the Bankruptcy
Code in early April 2001 to resolve increasing asbestos-related
liabilities. At the Petition Date, Grace reported total assets
of $2,323,500,000, and debts of $2,397,800,000. In comparison,
as of November 30, 2007, the Grace Debtors reported combined
assets of $3,335,000,000, and combined debts of $3,712,000,000,
resulting in equity of ($376,300,000).
GRACE'S PLAN
Grace filed its Plan of Reorganization on November 13, 2004, and
amended it on January 13, 2005. Grace's current draft is labeled
a Proposed First Amended Plan of Reorganization.
Grace's Plan classifies asbestos claims into (i) personal injury
claims that meet specified exposure and medical criteria or
PI-SE Claims; (ii) personal injury claims that do not meet the
exposure and medical criteria necessary to qualify as PI-SE
Claims or PI-AO Claims; and (iii) property damage claims,
including claims related to Grace's former Zonolite attic
insulation product.
Grace's Plan is premised on these principles:
(1) Substantive Consolidation
Grace and its debtor-affiliates will be substantively
consolidated for limited purposes including claims
allowance and treatment and distribution under the Plan.
The deemed substantive consolidation will not affect (i)
the Debtors' legal and organizational structure, (ii) the
encumbrances that are required to be maintained under the
Grace Plan, and (iii) the settlement agreements the
Debtors entered separately with Sealed Air Corporation and
Fresenius Medical Care Holdings, Inc.
(2) Creation of Asbestos Trust and its Funding
A Section 524(g) trust will be created for which all
asbestos-related claims will be channeled and resolved.
The Grace Asbestos Trust will be funded by payments from
Sealed Air pursuant to the settlement agreement, which
payments will consist of:
* $512,500,000 in cash, plus interest accrued from
December 21, 2005, until the Plan's effective date,
at a rate of 5.5% per annum compounded annually; and
* 18,000,000 shares of Sealed Air common stock, as
adjusted to account for a two-for-one stock split
implemented by Sealed Air in March 2007.
As of January 14 (Eastern Time), Sealed Air stocks are
priced at $20.77 per share, placing a value of about
373,860,000 on the settlement pact.
The PI-AO Claims would be funded with warrants exercisable
for that number of shares of Grace common stock, which,
when added to the shares issued directly to the Asbestos
Trust on the effective date of the Plan, would represent
50.1% of Grace's voting securities. If the common stock
issuable on exercise of the warrants is insufficient to
pay all PI-AO Claims, then Grace would pay any additional
liabilities in cash.
PI Claimants would have the option to litigate their
claims against the trust or, if they meet specified
eligibility criteria, accept a settlement amount based on
the severity of their disease. PD Claimants, on the other
hand, would be required to litigate their claims against
the trust.
On confirmation of Grace's Plan, all asbestos-related
claims against Grace's Canadian operating subsidiary,
Grace Canada, Inc., will be transferred to the Asbestos
Trust along with all Asbestos Claims.
As of January 9, 2008, the Court has approved settlement
agreements between Grace and two law firms representing PD
Claimants. PD Claimants represented by the law firm Dies
& Hile, LLP, received a $60,000,000 settlement amount,
while Claimants represented by the law firm Motley Rice,
LLC, received a $17,900,000 settlement amount. Grace is
currently litigating the remaining PD Claims.
(3) $1,613,000,000 Maximum Value of Asbestos-Related Claims
As a condition to the effectiveness of the Grace Plan, the
Debtors want the Court to establish that their aggregate
Asbestos PI-SE Claims, Asbestos PD Claims, and Asbestos
Trust Expenses is not greater than $1,483,000,000, and
their Asbestos PI-AO Claims not greater than $130,000,000.
(4) Treatment of Non-Asbestos Claims
All allowed administrative or priority claims would be
paid 100% in cash and all general unsecured claims, other
than those covered by the asbestos trust, would be paid
85% in cash and 15% in Grace common stock. Grace
estimates that claims with a recorded value of
$1,241,000,000, including interest accrued through
December 31, 2006, would be satisfied in the manner
pursuant to Grace's Plan at the effective date of that
Plan.
Grace estimates that their allowed non-asbestos claims
will total:
Administrative Claims $138,000,000
Priority Tax Claims 232,000,000
Secured Claims 90,000,000
Unsecured Employee-Related Claims 191,000,000
General Unsecured Claims 951,000,000
--------------
$1,602,000,000
==============
Grace would finance these payments with $150,000,000 of
cash on hand, $115,000,000 from the settlement agreement
with Fresenius Medical Care Holdings, Inc., $800,000,000
in new debt, and $143,000,000 in value of Grace common
stock.
Grace would satisfy other non-asbestos related
liabilities, estimated to be $508,000,000, primarily
environmental, tax, pension and retirement medical
obligations, as they become due and payable over time.
Proceeds from available product liability insurance would
supplement operating cash flow to service new debt and
liabilities not paid on the effective date of the Plan.
(5) Treatment of Equity Interests
Grace common stock will remain outstanding at the
effective date of the company-proposed Plan, but interests
of existing shareholders would be subject to dilution by
additional shares of common stock issued under the Plan.
(6) Estimated Value of Reorganized Debtors
In their Joint Plan, the Debtors estimate that their
reorganized value ranges from $2,200,000,000 to
$2,600,000,000.
A full-text copy of Grace's Reorganization Plan is available for
free at http://ResearchArchives.com/t/s?2712
A full-text copy of the Disclosure Statement is available for free
at http://ResearchArchives.com/t/s?2713
PI COMMITTEE/FCR'S COMPETING PLAN
On November 5, 2007, the Official Committee of Asbestos
Personal Injury Claimants and David T. Austern, the
Court-appointed future claims representative, filed a competing
joint plan of reorganization.
Judge Fitzgerald terminated Grace's exclusivity periods in July
2007 noting that despite the company's more than six years under
bankruptcy protection, it still has not negotiated a consensual
resolution of its asbestos liabilities with interested parties.
The Competing Plan conditions its effectivity on the Bankruptcy
Court finding that Grace's pending and future asbestos
liabilities is not less than $4,000,000,000.
Asbestos PI Claims, under the Competing Plan, will be resolved in
accordance with an Asbestos Trust Agreement and Trust
Distribution Procedures. The Asbestos Trust will be funded by:
* the Sealed Air Payment -- $512,500,000 cash, plus interest,
and 9,000,000 shares of Sealed Air common stock;
* any proceeds from insurance policies covering Grace's
asbestos liabilities;
* cash, in an amount equal to the Distributable Cash
Percentage multiplied by the Estimated PI Amount, reduced by
the Sealed Air Payment Amount; and
* a number of shares of Grace's common stock.
The Competing Plan provides that certain classes of claims will
be paid in full or reinstated, including:
-- priority claims,
-- secured claims,
-- unsecured pass-through employee-related claims,
-- workers' compensation claims,
-- intercompany claims,
-- Zonolite Attic Insulation claims, and
-- equity interests in the Debtors other than W.R. Grace & Co,
the parent company.
A full-text copy of the PI/FCR Plan is available for free at:
http://ResearchArchives.com/t/s?2504
ASBESTOS PERSONAL INJURY CLAIMS VALUATION
Grace -- $385,000,000 to $1,314,000,000
Grace will ask the Court to find that the value of its pending
and future PI liabilities ranges from $385,000,000 to
$1,314,000,000. Grace has maintained throughout its bankruptcy
case that many PI Claimants have not submitted evidence showing
they have handled any of the company's asbestos-containing
products or evidence showing a link between asbestos and any
medical problems.
Grace's expert, Dr. B. Thomas Florence, who has 30 years of
experience in management consulting and research, estimates that,
as of April 2001, the net present value of the company's pending
and future asbestos PI claims is within a range of $385,000,000
to $1,314,000,000, through 2049, with a median of $712,000,000.
To arrive at his estimate, Dr. Florence used:
* 5.36% discount rate,
* 2.5% inflation rate, and
* 1.5% claim value deflation rate.
Dr. Florence also used a set of assumptions based on the premise
that only claimants whose claims meet certain criteria would be
able to sustain their burden of proof that their claims against
the Debtors are valid, and therefore should be valued as part of
the estimation process. The evidentiary criteria used are:
1. a proof of claim;
2. minimum exposure criteria: nature of exposure to Grace
asbestos containing products must be either because
claimant is a worker who personally mixed Grace asbestos-
containing products or because claimant is a worker who
personally installed Grace asbestos-containing product;
3. minimum causation criteria for Lung Cancer claims of (i)
diagnosis of asbestosis based on the B-Reader report of a
reliable B-Reader, and (ii) reproducible ILO score of 1/0
or greater;
4. minimum medical criteria for Other Cancer claims of
diagnosis of laryngeal cancer;
5. minimum medical criteria for all Non-malignant claims of
(i) diagnosis of asbestosis or diffuse pleural thickening
based on the B-Reader report of a reliable B-reader, and
(ii) ILO score of 1/0 or greater for asbestosis;
6. minimum impairment criteria for Severe Asbestosis claims of
(i) diagnosis of asbestosis based on the B-Reader report of
a reliable B-Reader, (ii) ILO score of 2/1 or greater,
(iii) Pulmonary Function Test results of TLC <65% or
complying with American Thoraic Society standards; and
7. minimum impairment criteria for Asbestosis claims of (i)
diagnosis of asbestosis or diffuse pleural thickening based
on the B-Reader report of a reliable B-Reader, (ii) ILO
score of 1/0 or greater, and (iii) PFT results of TLC <80%
or complying with ATS standards.
Throughout Grace's bankruptcy case, the Official Committee of
Unsecured Creditors has been supportive of the Debtors' case
management proposal saying that it is a reasonable means to
determine the "true scope of Grace's liability to asbestos
claimants and then provide for the payment of valid claims on a
basis that preserves Grace's still strong core business
operations."
The Official Committee of Equity Security Holders, who represents
holders of more than 70,000,000 shares of Grace's common stock,
has maintained that Grace is solvent. The Equity Committee
believes that the estimation trial will demonstrate that, as a
matter of logic and epidemiological science, the number of
individuals who could realistically have developed true asbestos-
related disease from Grace products is diminishingly small.
PI Committee -- $4,700,000,000 to $6,200,000,000
The PI Committee's expert, Dr. Mark Peterson, a trial lawyer and
social psychologist, estimates that Grace's pending and future PI
liabilities range from $4,700,000,000 to $6,200,000,000.
According to Dr. Peterson, he used standard forecasting methods
regularly accepted by courts, asbestos trusts and businesses for
establishing asbestos liabilities. Grace's asbestos liability is
estimated as the product of (i) the number of claims, (ii) the
fraction of claims that get paid, and (iii) the paid values of
those claims.
Present Value of Grace Liability
for Pending and Future Claims
(in millions)
Other Non-
Period Meso Lung Cancer Malignant Total
------ ---- ---- ------ --------- -----
Pending $249 $91 $12 $228 $578
Future $3,149 $474 $71 $1,364 $5,106
----- ---- ------ --------- ------
$3,445 $565 $83 $1,562 $5,684
----- ---- ------ --------- ------
FCR -- $7,900,000,000
The FCR's expert, Jennifer L. Biggs, an actuarian, estimates that
Grace's liabilities is $7,900,000,000, on an undiscounted basis.
She estimates that, when reduced to present value as of the
Petition Date using a 5.2% interest rate, Grace's PI liabilities
is $3,700,000,000.
Ms. Biggs based her estimate by projecting the quantity and type
of future PI Claims against Grace for up to 54 years after
the Petition Date. The estimate also includes a provision for
the known pending PI Claims filed against the Debtors on or
before the Petition Date. Ms. Biggs calculated the total
liability by multiplying the known pending and projected future
claims filings by the expected average payment amounts that the
Debtors would pay to claimants in each of the years in
projection.
About W.R. Grace
Headquartered in Columbia, Md., 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, P.C., 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, PA.
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 Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents 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
commenced on January 14, 2008.
At Dec. 31, 2006, the W.R. Grace's balance sheet showed total
assets of $3,620,400,000 and total debts of $4,189,100,000.
As of November 30, 2007, W.R. Grace's balance sheet showed total
assets of $3,335,000,000, and total debts of $3,712,000,000.
(W.R. Grace Bankruptcy News, Issue No. 147; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
WACHOVIA BANK: Moody's Maintains Low-B Ratings on Six Classes
-------------------------------------------------------------
Moody's Investors Service affirmed these ratings of 26 classes of
Wachovia Bank Commercial Mortgage Trust, Commercial Mortgage Pass-
Through Certificates, Series 2006-C25:
-- Class A-1, $26,408,593, affirmed at Aaa
-- Class A-2, $122,437,000, affirmed at Aaa
-- Class A-3, $57,689,000, affirmed at Aaa
-- Class A-PB1, $50,000,000, affirmed at Aaa
-- Class A-PB2, $75,775,000, affirmed at Aaa
-- Class A-4, $723,742,000, affirmed at Aaa
-- Class A-5, $ 500,000,000, affirmed at Aaa
-- Class A-1A, $334,087,319, affirmed at Aaa
-- Class A-M, $286,242,000, affirmed at Aaa
-- Class A-J, $218,260,000, affirmed at Aaa
-- Class IO, Notional, affirmed at Aaa
-- Class B, $10,734,000, affirmed at Aa1
-- Class C, $35,781,000, affirmed at Aa2
-- Class D, $32,202,000, affirmed at Aa3
-- Class E, $17,890,000, affirmed at A1
-- Class F, $32,202,000, affirmed at A2
-- Class G, $32,202,000, affirmed at A3
-- Class H, $32,203,000, affirmed at Baa1
-- Class J, $32,202,000, affirmed at Baa2
-- Class K, $32,202,000, affirmed at Baa3
-- Class L, $10,734,000, affirmed at Ba1
-- Class M, $10,734,000, affirmed at Ba2
-- Class N, $10,734,000, affirmed at Ba3
-- Class O, $7,156,000, affirmed at B1
-- Class P, $7,157,000, affirmed at B2
-- Class Q, $7,156,000, affirmed at B3
As of the Dec. 17, 2007 distribution date, the transaction's
aggregate principal balance has decreased by approximately 4.0% to
$2.75 billion from $2.86 billion at securitization. The
Certificates are collateralized by 148 loans, ranging in size from
less than 1.0% to 11.5% of the pool, with the top ten loans
representing 42.8% of the pool. The pool includes three shadow
rated loans, representing 5.7% of the pool. No loans have
defeased. The pool has not realized any losses since
securitization and currently there are no loans in special
servicing. Seventeen loans, representing 8.7% of the pool, are on
the master servicer's watchlist.
Moody's was provided with year-end 2006 and partial year 2007
operating results for 94.6% and 53.7%, of the pool respectively.
Moody's weighted average loan to value ratio for the conduit
component is 101.9%, compared to 102.0% at securitization.
The largest shadow rated loan is the Westfield Gateway Loan ($83.0
million; 3.0%), which is secured by the borrower's interest in a
924,000 square foot (519,000 square feet is collateral) regional
mall located in Lincoln, Nebraska. The loan is interest only for
the entire term. Moody's current shadow rating is Baa3, the same
as at securitization.
The second largest shadow rated loan is the Paramount Building
Loan ($39.5 million; 1.4%), which is secured by a 639,000 square
foot office building located in New York City. The loan is
interest only for the entire term. Moody's current shadow rating
is Aaa, the same as at securitization.
The third largest shadow rated loan is the Wyndham Hotel
Greenspoint Loan ($34.0 million; 1.2%), which is secured by a 472
room hotel located in Houston, Texas. Moody's current shadow
rating is Baa1, the same as at securitization.
The top three conduit loans represent 21.0% of the pool. The
largest conduit loan is the Prime Outlets Pool Loan
($315.3 million - 7.5%), which is a 50.0% participation interest
in a $630.6 million loan secured by 10 retail centers located in
eight states, including Texas, Pennsylvania, Florida, and Ohio.
The total gross leaseable area is 3.5 million square feet. The
loan is interest only for the first 24 months of the term,
amortizing on a 360-month schedule thereafter. Moody's LTV is
109.7%, the same as at securitization.
The second largest conduit loan is the Marriot-Chicago Loan
($195.0 million -- 7.1%), which is secured by a 1,192 room full
service hotel located in Chicago, Illinois. RevPAR for 2006 was
$140.25 compared to $135.98 at securitization. The loan has a
non-pooled junior component of $25 million. The loan is interest
only for the first 48 months and then amortizes on a 360 month
schedule. Moody's LTV is 88.7%, compared to 96.3% at
securitization.
The third largest conduit loan is the 530 Fifth Avenue Loan
($175.0 million -- 6.4%), which is secured by a 500,000 square
foot office property located in New York City. As of October
2007, the property was 100.0% leased, the same as at
securitization. The property is also encumbered by a
$25 million non-trust junior component and $25 million of
mezzanine financing. The loan is interest only for the first 48
months and then amortizes on a 360 month schedule. Moody's LTV is
90.3%, the same as at securitization.
WASHIGNTON MUTUAL: Discloses $1.87BB Loss After $1.6BB Writedown
----------------------------------------------------------------
Washington Mutual Inc. disclosed a fourth quarter 2007 net loss of
$1.87 billion, or $2.19 per diluted share. The company attributed
the loss to the $1.6 billion after-tax charge to writedown Home
Loans goodwill and the higher level of provisioning stemming from
the housing market weakness. Due to fourth quarter results, the
company recorded a net loss of $67 million, or $0.12 per diluted
share, for all of 2007.
"We announced in December a series of proactive steps being taken
to manage through the unprecedented market conditions that this
company and others in the financial services industry face," WaMu
Chairman and Chief Executive Officer Kerry Killinger, said."
These actions included:
-- The raising of $2.9 billion in net proceeds through the
issuance of convertible preferred stock that increased the
year-end tangible capital to tangible asset ratio to 6.67%,
$3.7 billion above the company's targeted ratio of 5.50%.
-- A reduction in the quarterly cash dividend rate on the
company's common stock to 15 cents per share.
-- A major expense reduction initiative projected to reduce
2008 noninterest expense by $500 million to $8.0 billion or
less.
-- A significant acceleration in the strategic focus of our
Home Loans business that emphasizes mortgage lending through
its retail banking stores and other retail distribution
channels.
"The substantial infusion of new capital, dividend reduction,
significant expense reductions, and the major change in our home
loans business all combine to further fortify WaMu's strong
capital and liquidity position," Mr. Killinger added.
Mr. Killinger added that the Retail Banking, Card Services and
Commercial businesses delivered steady performance in 2007. In
particular, the Retail Bank, which is the cornerstone of the
franchise, continued its strong growth opening more than
1.1 million net new checking accounts for the year. The company
plans to continue to leverage the Retail Bank's distribution
network by opening additional stores and adding more than
1 million net new checking accounts in 2008.
Solid revenues and continued focus on expense control. Total
revenue (net interest income plus noninterest income) of
$3.41 billion in the fourth quarter was solid, reflecting the
strength of the franchise as evidenced by the company's strong net
interest income and growth in fee income. Total revenue for the
quarter was negatively impacted by continued illiquidity in the
capital markets, resulting in reductions to noninterest income
from net market valuation losses of $528 million on the company's
trading and available-for-sale securities portfolios. Fourth
quarter noninterest expense, excluding the $1.78 billion pretax
charge to writedown Home Loans goodwill, was $2.39 billion, up
$200 million from the prior quarter due primarily to $143 million
associated with the expense reduction steps announced in December.
The company is projecting a $500 million reduction in 2008
noninterest expense to $8.0 billion or less.
Increase in loan loss provision reflects further weakening in
housing market. The company's provision of $1.53 billion was
within the most recently communicated guidance range of $1.5 to
$1.6 billion. This higher level of provisioning reflects the
nationwide housing market weakness that has increased
delinquencies and the level of charge-offs. During the quarter,
net charge-offs of $747 million were also in line with guidance.
The quarter's provision was approximately double the level of
net charge-offs, bringing the allowance for loan losses to
$2.57 billion at year end.
Home loan volume reflects distressed housing market. Fourth
quarter loan volume of $19.09 billion was down 28% from the third
quarter. During the fourth quarter, the company discontinued all
remaining lending through its subprime mortgage channel.
About Washington Mutual
Headquartered in Seattle, Washington Mutual Inc. (NYSE:WM) --
http://newsroom.wamu.com/-- is a group of consumer and small
business banks. At June 30, 2007, WaMu and its subsidiaries
reported total assets of $312.22 billion. The company's
subsidiary banks currently operate approximately 2,700 consumer
and small business banking stores throughout the United States.
* * *
Fitch placed Washington Mutual Inc.'s short term issuer default
rating at 'F2' and individual rating at 'B/C' in Dec. 10, 2007.
The rating outlook is negative.
As reported in the Troubled Company Reporter on Dec. 12, 2007,
Moody's Investors Service downgraded by two notches the long-term
ratings of Washington Mutual, Inc. (senior to Baa2 from A3) and
its subsidiaries including the lead thrift Washington Mutual Bank
(financial strength rating to C- from C+ and long-term deposits to
Baa1 from A2). Moody's placed a stable rating outlook on all
Washington Mutual entities.
WCI COMMUNITIES: Amends Credit Deals to Waive Loan Covenants
------------------------------------------------------------
WCI Communities Inc. has amended its senior secured revolving
credit agreement and term loan agreement. These amendments, which
extend through June 30, 2009, modify, suspend or waive certain
covenants and provide the company with greater operating and
financial flexibility to allow the company to manage its business
during this industry downturn.
The company also reduced the total commitment available under the
revolver and the outstanding amount of the term loan, converted a
portion of the revolver to non-revolving status, and agreed to
increase the pricing on the loans.
"We appreciate the continued support of our senior lenders and
believe that these amendments enhance WCI's financial flexibility
to help navigate through this difficult market," Jerry Starkey,
president and chief executive officer of the company, said.
"The company remains focused on generating cash flow to reduce
debt and strengthen its balance sheet," Mr. Starkey added. "We
continue to aggressively reduce overhead and search for avenues to
lower our cost of doing business without sacrificing the high
quality of our products and services which WCI's customers demand
and expect."
About WCI Communities
Headquartered in Florida, WCI Communities Inc. (NYSE: WCI) --
http://www.wcicommunities.com/-- is a home builder catering to
primary, retirement, and second-home buyers in Florida, New York,
New Jersey, Connecticut, Maryland and Virginia. The company
offers both traditional and tower home choices and features a wide
array of recreational amenities in its communities. In addition
to homebuilding, WCI generates revenues from its Prudential
Florida WCI Realty Division and its recreational amenities, well
as through land sales and joint ventures. The company owns and
controls developable land on which the companyplans to build about
20,000 traditional and tower homes.
* * *
As reported on the Troubled Company Reporter on Jan. 11, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on WCI Communities Inc. (WCI; CCC/Negative/--) continue to
acknowledge this Florida-based luxury homebuilder's acute
liquidity challenges.
As reported in the Troubled Company Reporter on Nov. 12, 2007,
Moody's lowered the ratings of WCI Communities Inc., including its
corporate family rating to Caa2 from B3 and the ratings on its
senior subordinated notes to Caa3 from Caa2. The ratings outlook
is negative.
XIOM CORP: Michael Studer Expresses Going Concern Doubt
-------------------------------------------------------
Michael T. Studer, CPA P.C. in Freeport, New York, expressed
substantial doubt about the ability of XIOM Corp. to continue as a
going concern after it audited the company's financial statements
for the year ended Sept. 30, 2007.
The auditor stated that XIOM has incurred losses for the years
ended Sept. 30, 2007 and 2006 and has a stockholders' deficit at
Sept. 30, 2007.
The company posted a net loss of $2,723,709 on net sales of
$933,194 for the year ended Sept. 30, 2007, compared with a net
loss of $805,821 on net sales of $629,336 for the year ended Sept.
30, 2006.
At Sept. 30, 2007, the company's balance sheet showed $1,307,051
in total assets, $1,508,506 in total liabilities and common stock,
subject To rescission rights of $670,399, and a stockholders'
deficit of $871,854.
A full-text copy of the company's 2007 annual report is available
for free at http://ResearchArchives.com/t/s?2719
About Xiom Corp.
Xiom Corp. (OTC BB: XMCP.OB) -- http://xiom-corp.com/-- of West
Babylon, New York, manufactures powder spray equipment and plastic
spray materials in its Long Island facility.
YCL MILFORD: Case Summary & 19 Largest Unsecured Creditors
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Debtor: YCL Milford Restaurant, LLC
654A North DuPont Highway
Milford, DE 19963
Bankruptcy Case No.: 08-10126
Chapter 11 Petition Date: January 16, 2008
Court: District of Delaware (Delaware)
Debtors' Counsel: Stephen W. Spence, Esq.
Phillips, Goldman & Spence
1200 N. Broom Street
Wilmington, DE 19806
Tel: (302) 655-4200
Fax: (302) 655-4210
http://www.pgslaw.com/
Estimated Assets: $1 million to $10 million
Estimated Debts: $1 million to $10 million
Consolidated Debtors' List of 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Reinhart Food Service, LLC food product $34,391
1901 South Oneida Street
Green Bay, WI 54304
City of Milford utilities $16,115
P.O. Box 159
Milford, DE 19963-0159
Milford Plaza Enterprises rent due $14,500
114 Hedge Apple Lane
Wilmington, DE 19807
Lankford Sysco Food Services food supplies $10,331
LLC
Waste Management services $3,520
WBOC/EBOC advertising $2,648
Delaware Department of Labor tax $2,110
Delaware Division of Revenue tax $2,196
Holly Poultry food product $1,952
Pitney Bowes lease $1,667
Yates Mushroom food product $1,560
Verizon phone service $1,252
Cloverland/Green Spring Dairy food product $876
Holt Paper & Chemical Co. Inc. supplies $754
Alarm Engineering alarm system $693
The Paper People Product $588
The Hartford Insurance insurance $580
Company Bankruptcy
Department
Roberts Oxygen equipment $375
Shoes for Crews supplies $199
* Arizona Bankruptcy Filing Rose 60% in 2007
--------------------------------------------
The United States Bankruptcy Court of Arizona reports a 60%
increase in its bankruptcy filings compared to a year earlier,
Edward Gately of East Valley Tribune.com reports.
The Court's record shows that filers were mostly consumers in
Phoenix and are for Chapter 7 liquidation, according to
Tribune.com.
Tribune.com notes that there were at least 7,204 filings in the
valley compared in 2006, while 10,570 filings for the State in
2007. The State averaged between 30,000 and 35,000 filing,
Tribune.com adds.
* U.S. Economy Experiences Modest Growth in 2007, Fed Reserve Says
------------------------------------------------------------------
The Federal Reserve said Wednesday that the economy of the United
States expanded "modestly" in several regions during middle of
November until December 2007, Rex Nutting writes for the
MarketWatch.
The Federal Reserve's Beige Book states that labor markets in
several areas are still "tight" amid the Department of Labor's
December 2007 report of a 5% unemployment rate increase,
MarketWatch relates.
Transactions of five out of twelve federal banking districts were
reportedly slow, another five were moderate, and the remaining two
mixed, MarketWatch reports, citing the Federal Reserve.
* BOOK REVIEW: American Commercial Banking: A History
-----------------------------------------------------
Author: Benjamin J. Klebaner
Publisher: Beard Books
Paperback: 296 pages
List Price: $34.95
Order your personal copy at
http://www.amazon.com/exec/obidos/ASIN/1587981424/internetbankrupt
This book American Commercial Banking: A History is written by
Benjamin J. Klebaner.
This informative and fascinating book traces the history of
commercial banking from its inception to 1988.
The authoritative historical perspective provides a greater
understanding of more recent times and of the many policy issues
that have arisen through the years.
In addition to being a remarkable piece of scholarship, it is a
very readable book. It should be on the "must read" list of all
students of finance and history, as well as others who are curious
as to the role banks have played in our society.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
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are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
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Each Tuesday edition of the TCR contains a list of companies with
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Monthly Operating Reports are summarized in every Saturday edition
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For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, Philline P. Reluya, Joseph Medel C.
Martirez, and Peter A. Chapman, Editors.
Copyright 2008. All rights reserved. ISSN: 1520-9474.
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*** End of Transmission ***