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/raid1/www/Hosts/bankrupt/TCR_Public/080122.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, January 22, 2008, Vol. 12, No. 18 Headlines ACA CAPITAL: Obtains February 19 Waiver from Lenders ALLENTOWN AREA: Heavy Losses Cue S&P to Cut Rating to BB- AMBAC ASSURANCE: Botched Equity Offering Cues S&P's Negative Watch ARROW ELECTRONICS: Acquiring Indian Distribution Business Assets ASARCO LLC: Asarco Inc. Wants Chapter 11 Examiner Appointed ASARCO LLC: Wants Action Removal Period Extended Until June 13 ASARCO LLC: Seeks April 11 Extension of Plan-Filing Period AVNET INC: Signs Definitive Pact Acquiring Azzurri Tech BARNERT HOSPITAL: Has Until April 11 to File Chapter 11 Plan BIOMET INC: Earn $89 Million in Second Quarter Ended November 30 BASIS YIELD: Judge Gerber Denies Recognition Under Chapter 15 BEAR STEARNS: Fitch Holds 'B-' Rating on $10.8MM Class K Certs. BEAR STEARNS: Limited Paydown Cues Fitch to Affirm Ratings BENCHMARK ELECTRONICS: Earns $22 Million in 2007 Third Quarter BOMBARDIER INC: $1BB Debt Redemption Cues Fitch to Lift Ratings BRUTI ASSOCIATES: Case Summary & 19 Largest Unsecured Creditors BUFFETS HOLDINGS: Board Vice-Chairman Roe H. Hatlen Resigns C AND C PROP: Court Approves Adequacy of Disclosure Statement C-BASS MORTGAGE: S&P Junks Ratings on Four Certificate Classes CABELA'S CREDIT: Fitch Rates $11.25MM Class D Notes at BB+ CARRINGTON MORTGAGE: S&P Junks Ratings on Two Classes from 'B' CHEC LOAN: S&P Junks Rating on Class B-2 Securities From 'BB' CLAYMONT STEEL: Evraz Completes Tender Offer for Common Stock CONCORD RE: S&P Withdraws BB+ Rating on $365 Million Bank Loan CONGOLEUM CORP: Sept. 30 Balance Sheet Upside-Down by $44.9 Mil. CONTINENTAL AIRLINES: Reports 2007 Pre-Tax Income of $566 Million CORNERSTONE FIN'L: Case Summary & Ten Largest Unsecured Creditors COUNTRYWIDE FINANCIAL: Inks 4th Amendment to Restated Rights Pact CREDIT SUISSE: S&P Cuts Certificate Rating to B on Recent Losses DAVID FLANAGAN: Voluntary Chapter 11 Case Summary DAVID HURT: Voluntary Chapter 11 Case Summary DAVID PIERCE: Case Summary & 20 Largest Unsecured Creditors DELPHINUS CDO: Moody's Junks Rating on $48 Mil. Notes from Ba2 DOWNTOWN NORTH: Case Summary & 20 Largest Unsecured Creditors DURA AUTOMOTIVE: Wants to Assume GM Component Supply Agreement ECHOSTAR COMMS: S&P Maintains 'BB-' Corporate Credit Rating ECOMARES INC: Chapter 15 Petition Summary ELWOOD ENERGY: S&P Lifts Rating on $402 Mil. 2026 Bonds to 'BB' EMI GROUP: Terra Firma Outlines Restructuring Plan ENECO INC: Case Summary & 20 Largest Unsecured Creditors ERIE BAY: Case Summary & 17 Largest Unsecured Creditors EUROFRESH INC: S&P Cuts Ratings to 'D' on Missed Interest Payment FEDDERS CORP: Completes $7.5 Million Sale of Affiliate's Assets FEDDERS CORP: Sells Eubank Coil to National Oil for $2.3 Million FEDDERS CORP: Unsecured Creditors Want to Sue Insiders & Lenders FLEXTRONICS INTERNATIONAL: Dr. Willy Shih Joins Board of Directors GCI INC: Earns $2.2 Million in Third Quarter Ended Sept. 30 GS MORTGAGE: Fitch Junks Ratings on Four Certificate Classes HARRAH'S ENT: Fitch Withdraws 'BB+' Issuer Default Rating HOFF JEWELERS: Case Summary & 20 Largest Unsecured Creditors HOVNANIAN ENT: Fitch Lowers Issuer Default Rating to B- from BB- HYDROCHEM INDUSTRIAL: S&P Withdraws 'B' Corporate Credit Rating INDYMAC RESIDENTIAL: Expected Losses Cue Fitch to Junk Ratings INTERSTATE BAKERIES: Yucaipa Disapproves Disclosure Statement JP MORGAN: Fitch Downgrades Ratings on 25 Certificate Classes JP MORGAN: Fitch Junks Ratings on Two Certificate Classes KORYN ROLSTAD: Case Summary & Five Largest Unsecured Creditors LEISURE LIVING: Case Summary & 11 Largest Unsecured Creditors LENNAR CORP: Names Sherrill Hudson as Board Independent Member LONG BEACH MORTGAGE: Moody's Downgrades and Reviews 18 Ratings MASHANTUCKET PEQUOT: Moody's May Downgrade Ba1 Note Rating MASTR ADJUSTABLE: Class B-5 Obtains S&P's Junk Rating from 'B' MERRILL LYNCH: Moody's Junks "B1" Rating on Class B-1 Debentures MERRILL LYNCH: Moody's Reviews Ba1 Rating for Likely Downgrade MUSICLAND HOLDING: Parties Extend Trade Claims Filing to Feb. 29 MZT HOLDINGS: Files Certificate of Dissolution in Delaware NACIO SYSTEMS: Voluntary Chapter 11 Case Summary OAK MESA: Case Summary & Eight Largest Unsecured Creditors OWNIT MORTGAGE: Court Confirms Third Amended Liquidation Plan PEP BOYS: Moody's Puts All Ratings Under Review for Possible Cuts PETRO ACQUISITIONS: Voluntary Chapter 11 Case Summary PINE RIVER: Court Confirms Chapter 11 Plan of Liquidation QUEBECOR WORLD: Files for Chapter 11 Protection in Manhattan QUEBECOR WORLD: Case Summary & 57 Largest Unsecured Creditors QUEST TRUST: Poor Credit Support Spurs S&P's Ratings Downgrade R-G CROWN: Fitch Lifts Ratings on Completed FITB Merger Deal RBSGC MORTGAGE: Fitch Affirms 'B' Rating on Class 3-B-5 Certs. REGAL ENT: Inks $210MM Merger Deal With Consolidated Theatres REGAL ENTERTAINMENT: $210 Mil. Deal Won't Affect S&P's Rating RITCHIE MULTI-STRATEGY: Wants Involuntary Petition Dismissed SEA CONTAINERS: Wants SC Iberia and YMCL Guarantees Approved SIERRA TIMESHARE: Moody's Puts Ba2 Final Rating on Class B Notes SPIRIT AEROSYSTEMS HOLDINGS: Earns $83.6 Million in 2007 3rd Qtr. SRG 457: Voluntary Chapter 11 Case Summary STUDENT FINANCE: Ch. 7 Trustee Balks at Claims Totaling $1 Billion TRIGEM COMPUTER: Representative Files 6th Section 1518(1) Report WALTERS OIL: Case Summary & 19 Largest Unsecured Creditors WASHINGTON MUTUAL: Moody's Ratings Unmoved by $1.9 Bil. Losses WCI COMMUNITIES: S&P's CCC Rating Unaffected by Loan Amendments WELLS FARGO: Fitch Junks Rating on Class B-5 Certificates XYIENCE INC: Case Summary & 20 Largest Unsecured Creditors * Fitch Cuts Ratings on 28 CLO Tranches and Puts on Neg. Watch * Fitch Says Extended Buybacks May Increase M&A for Oil Majors * Large Companies with Insolvent Balance Sheet ********* ACA CAPITAL: Obtains February 19 Waiver from Lenders ---------------------------------------------------- ACA Capital Holdings, Inc. has entered into a second forbearance agreement with its structured credit and other similarly situated counterparties. Under the agreement, the counterparties have waived all collateral posting requirements, termination rights and policy claims relating to the rating of ACA Financial Guaranty Corporation, ACA Capital's financial guaranty insurance subsidiary, under their respective transaction documents including any credit support annexes and similar agreements. The forbearance will remain effective through Feb. 19, 2008, at 11:59 p.m. (New York City local time). The company has reached an additional short-term agreement with its counterparties and continues to work closely with them to develop a permanent solution to stabilize its capital position. About ACA Capital ACA Capital Holdings Inc. (NYSE: ACA) (OTC BB: ACAH.PK) -- http://www.aca.com/-- is a holding company that provides financial guaranty insurance products to participants in the global credit derivatives markets, structured finance capital markets and municipal finance capital markets. It also provides asset management services to specific segments of the structured finance capital markets. The company participates in its target markets both as a provider of credit protection through the sale of financial guaranty insurance products, for risk-based revenues, and as an asset manager, for fee-based revenues. ACA Capital has offices in New York, London, and Singapore. ACA Capital, through ACA Financial Guaranty Corporation, provides credit protection products. ACA Financial insures the principal and interest of bonds issued in the public finance market and targets the low investment grade ("BBB-") to high non-investment grade ("BB") portion of the public finance market. Typically, ACA Financial is paid one payment for insurance, up-front, based on the total amount of principal and interest insured. The payments received are held in reserve and earn out over the life of the related financial guaranty, nominally 30 years. At Sept. 30, 2007, ACA Financial had $7.0 billion of gross par exposure in its public finance business. * * * ACA Capital's balance sheet as of Sept. 30, 2007, showed total assets of $4.9 billion, total liabilities of $5.8 billion, and minority interest of $9.5 million, resulting in total stockholders' deficit of $883.3 million. ALLENTOWN AREA: Heavy Losses Cue S&P to Cut Rating to BB- --------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on Allentown Area Hospital Authority, Pennsylvania's series 2005 hospital and series 1998A-B bonds revenue bonds, issued for Sacred Heart Hospital of Allentown, to 'BB-' from 'BB+', reflecting significant operating losses, excluding investment income, grants, and contributions over the past several years that have been well below management's budgeted expectations for each year. The outlook is stable. "To achieve a higher rating, Sacred Heart will need to demonstrate a trend of improved financial performance across the system, and more specifically at the hospital and with its employed physicians," said Standard & Poor's credit analyst Jennifer Soule. "It would be challenging for Sacred Heart to reach an investment- grade rating over the next one to two years, given current market dynamics and the organization's limited financial flexibility." The 'BB-' reflects Sacred Heart's modest improvement in fiscal 2007 results that was not as strong as management's original projections, and this trend continues through the first four months of fiscal 2008 ended Oct. 31, 2007; and management's various changes throughout the system in recent months, including the closure of the hospital's open heart program, which it expects to provide cost savings; however, S&P believes that it will be difficult for the organization to realize its projected operating results in fiscal 2008. The rating also reflects a highly competitive marketplace where two larger health systems are a major presence, although Sacred Heart continues to work in collaboration with each entity where plausible. A lower rating is precluded by an adequate and stable balance sheet for the rating category, characterized by 76 days' cash on hand, a 52.6% debt-to-capitalization ratio, and a 50.8% cash-to- debt ratio. The lowered rating affects about $41.8 million in rated debt. AMBAC ASSURANCE: Botched Equity Offering Cues S&P's Negative Watch ------------------------------------------------------------------ Standard & Poor's Ratings Services placed Ambac Assurance Corp.'s financial strength, financial enhancement, and issuer credit ratings and Ambac Financial Group Inc.'s senior unsecured, issuer credit, and hybrid security ratings on CreditWatch with negative implications. At the same time, Standard & Poor's placed the preferred stock ratings of the committed capital facilities supported by, and for the benefit of, Ambac on CreditWatch with negative implications. The rating actions follow Ambac Financial Group's announcement that it is not proceeding with a planned $1.0 billion equity offering due to market conditions. Based on the results of S&P's latest stress test, published on Jan. 17, Standard & Poor's identified a capital shortfall of approximately $400 million in new capital in applying S&P's ratings criteria. In S&P's opinion, the decision not to proceed with the equity offering is symptomatic of an environment in which Ambac's capital-raising options are impaired. At the same time, the amount of additional capital that Ambac may need to sustain S&P's view of the current ratings could continue to increase, reflecting the uncertainty surrounding the ultimate levels of subprime and other mortgage- related losses. Ambac continues to explore capital-raising options, but it is increasingly uncertain whether it can implement any of these over the near term. To the extent that Ambac is unable to raise sufficient capital over the near term in relation to its increased capital needs, these ratings could be lowered. ARROW ELECTRONICS: Acquiring Indian Distribution Business Assets ---------------------------------------------------------------- Arrow Electronics Inc. agreed to acquire all of the assets related to the franchise components distribution business of Hynetic Electronics and Shreyanics Electronics in India, effective Jan. 1, 2008. Privately owned, Hynetic Electronics and Shreyanics Electronics are leading electronic component distributors in India. "I am delighted to add the components distribution business of Hynetic to our expanding franchise in the Asia Pac region, further strengthening our leadership position in the fast- growing Indian marketplace. The Hynetic business is similar to Arrow's, with its demand-creation business model and strong engineering capabilities, and we anticipate meaningful synergies between our two businesses. Hynetic's complementary linecard and experienced sales professionals will allow us to expand our product portfolio and offer improved services and support to our business partners," said Michael J. Long, president of Arrow Global Components. "This acquisition will be beneficial to Arrow, with an expanded customer base focusing on the rapidly growing small- and medium- sized market and additional strategic product lines, which are critical for Arrow to further expand market share in India. At the same time, Hynetic's customers and suppliers gain instant access to Arrow's specialized expertise, technical resources, supply chain solutions and extensive logistics capabilities," said Peter Kong, president of Arrow Asia Pacific. About Arrow Electronics Headquartered in Melville, New York, Arrow Electronics Inc. -- http://www.arrow.com/-- provides products, services and solutions to industrial and commercial users of electronic components and computer products. Arrow serves as a supply channel partner for nearly 600 suppliers and more than 130,000 original equipment manufacturers, contract manufacturers and commercial customers through a global network of over 270 locations in 53 countries and territories. The company operates in France, Spain, Portugal, Denmark, Estonia, Finland, Ireland, Latvia, Lithuania, Norway, Sweden, Italy, Germany, Austria, Switzerland, Belgium, the Netherlands, United Kingdom, Argentina, Brazil, Mexico, Australia, China, Hong Kong, Korea, Philippines and Singapore. * * * Arrow Electronics senior subordinated stock continues to carry Moody's Investors Service's Ba1 rating. The company's senior preferred stock is rated at Ba2. ASARCO LLC: Asarco Inc. Wants Chapter 11 Examiner Appointed ----------------------------------------------------------- Asarco Incorporated, the 100% equity holder of ASARCO LLC and its debtor-affiliates, asks the U.S. Bankruptcy Court for the Southern District of Texas to appoint an examiner to: (a) investigate the facts and circumstances surrounding the good faith of the ongoing negotiations among the Debtors and certain other constituents with respect to the terms of the future plan of reorganization for the Debtors; (b) determine the value of the Debtors; (c) investigate the good faith of the settlements of claims reached among the Debtors, the asbestos claimants and the United States Department of Justice with respect to asbestos and environmental claims asserted against the Debtors; and (d) investigate whether ASARCO LLC has fulfilled its fiduciary duties to its parent company, Asarco Inc. Charles A. Beckham, Jr., Esq., at Haynes and Boone, LLP, in Houston, Texas, points out certain issues that he thinks creates a "disturbing picture," not only as to whether the Debtors fulfilled their fiduciary duties, settled claims in good faith, and entered into appropriate plan negotiations, but also as to whether they have fulfilled their responsibilities to the Court. He alleges that Asarco LLC is hiding "crucial information regarding claims and valuation." He relates that in November 2007, ASARCO LLC's counsel has led the Court to believe that the company did not have an estimate of claims or a valuation analysis, and yet, ASARCO LLC, in December, presented claims analysis and valuation reports at the the fraudulent complaint litigation against Americas Mining Corporation in the U.S. District Court for the Southern District of Texas, Brownsville Division. Mr. Beckham says the claims analysis report was prepared by AlixPartners and the valuation report was prepared by Lehman Brothers, Inc. Those reports, however, were subject to confidentiality agreements and thus, were not publicly available, he tells the Court. "The lack of candor by the Debtors' professionals is symptomatic of a 'win at all costs' approach to disenfranchising the Parent, and calls into question the good faith of the Debtors' actions, he asserts. Mr. Beckham asserts that an examiner will probe into whether ASARCO LLC's board of directors breached their fiduciary duties by refusing to substantively respond to the stand-alone reorganization plan, which intends to pay 100% to creditors, that Asarco Inc. proposed in 2007. In addition, the examiner will investigate ASARCO LLC's good faith intention in entering into settlements. Mr. Beckham discloses that ASARCO LLC has agreed to a settlement of its derivative asbestos liabilities for a multiple of its own expert's maximum liability estimate -- without even contesting the issue of its liability under a corporate-veil-piercing theory for the liabilities of its subsidiaries. Mr. Beckham asserts that appointment of an examiner is mandated by Section 1104(c)(2) of the Bankruptcy Code, on the request of a party-in-interest when a debtor's fixed, liquidated unsecured debts, other than debts for goods, services, or taxes, owing to an insider, exceed $5,000,000. ASARCO LLC has stated, in its Chapter 11 Petition, that its has at least $440,000,000 of those debts, he notes. Asarco Inc. thus asks the Court to afford any examiner a broad mandate. The examiner should be empowered to provide an independent investigation of ASARCO LLC's conduct and should be allowed to begin an investigation as soon as possible, Mr. Beckham asserts. 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 seek to extend their exclusive period to file a plan of reorganization to April 11, 2008. (ASARCO Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Wants Action Removal Period Extended Until June 13 -------------------------------------------------------------- ASARCO LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Texas to extend, until June 13, 2008, the period wherein they can remove civil actions. The Debtors said they need more time to review their civil lawsuits to determine whether those lawsuits should be removed. They elaborate that they are parties in myriad lawsuits in various states and federal courts and that those lawsuits are complex and may require individual analysis. 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 seek to extend their exclusive period to file a plan of reorganization to April 11, 2008. (ASARCO Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Seeks April 11 Extension of Plan-Filing Period ---------------------------------------------------------- ASARCO LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Texas to further extend, until April 11, 2008, the exclusive period wherein they may file a Chapter 11 plan of reorganization. Additionally, the Debtors ask the Court to set June 13, 2008 as the deadline for them to solicit acceptances of that plan. The Debtors' current exclusive plan filing period is set to expire on February 11. The Debtors assert that extension of their exclusive periods is warranted. The Debtors need more time to reach a definitive agreement with two of their largest creditor groups -- the environmental and asbestos claimants -- on the terms of a consensual reorganization plan, and the process and procedures for selecting a Chapter 11 plan sponsor, James R. Prince, Esq., at Baker Botts, L.L.P., in Dallas, Texas, tells the Court. He relates that the Debtors, the Official Committee of Unsecured Creditors for the Asbestos Subsidiary Debtors, Robert C. Pate, the Court-appointed future claims representative, and the U.S. Department of Justice, have started engaging in mediations and negotiations in October 2007 regarding the resolution of environmental and asbestos claims filed against the Debtors. As of Jan. 18, 2008, the Debtors have concluded environmental mediation and submitted settlements with respect to 19 out of the 21 environmental sites they own. Mediation on two sites -- the East Helena and U.S. Section, International Boundary and Water Commission sites -- will continue until the parties have reached a settlement, Mr. Prince says. As for the asbestos claims, Mr. Prince relates that mediation and presentation of expert reports and evidence are underway. The Debtors and the asbestos parties are on the process of entering into a global settlement but that settlement has not been finalized, he says. Judge Elizabeth Magner, the Court-appointed asbestos claims mediator, will continue mediation on the asbestos claims on January 24, 2008. Mr. Prince adds that the Debtors are finalizing the terms of several settlement agreements with claimants alleging toxic tort damages unrelated to asbestos. He further asserts that the Debtors need the deadline extension to continue their litigation relating to avoidance action complaints that if successful, will result in substantial recovery for the Debtors. 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). (ASARCO Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AVNET INC: Signs Definitive Pact Acquiring Azzurri Tech ------------------------------------------------------- Avnet Inc. has entered into a definitive agreement to acquire the U.K.-based distributor Azzurri Technology Ltd. Azzurri is one of Europe's leading design distributors of high technology semiconductors and embedded systems products. The closing of the transaction is subject to customary regulatory approval and other closing conditions. Upon closing, Azzurri will be integrated into Avnet Electronics Marketing EMEA primarily within the Avnet Memec specialist division. Azzurri has been in business for more than ten years and has operations in the UK, Germany, France and Italy. Its annual revenue is approximately $100 million and it employs about 80 people. Azzurri has established a first class reputation for introducing leading technology products into the European electronics market. Azzurri is focused on a small number of franchised suppliers with the prime objective of assisting customers with the design-in of complex semiconductors and sub- system level solutions. Harley Feldberg, president of Avnet Electronics Marketing, commented, "Adding Azzurri's design and engineering expertise to our European team will enhance Avnet Memec's position as the leading pan-European specialist distributor and will benefit both customers and suppliers alike. The acquisition will add new semiconductor suppliers to Avnet Memec's breadth of product offerings in microprocessors, microcontrollers and analog components and expands our presence in Europe's largest markets." "Design-in distribution with exceptional service to our customers and suppliers is the foundation of our company," said Mike Carlucci, Azzurri's president and CEO. "Avnet Memec has a similar approach to the marketplace and that is why the strategic fit is so strong. Both companies have much to gain from working together and merging them will bring many benefits to employees, suppliers and customers," added Mr. Carlucci. With the addition of Mr. Azzurri, Avnet Memec will add talented employees in several important markets and increase its revenue base over 40%. The combined organization's strength in engineering will be complemented by Avnet's world-class supply chain management and logistics capabilities. The transaction is expected to be immediately accretive to earnings, excluding minimal integration charges, and supports Avnet's long-term return on capital goals. The two organizations share the same market approach, have complementary line cards and put design and engineering expertise at the core of their value proposition for customers and suppliers. Steve Haynes, president of Avnet Memec EMEA stated, "I am enthusiastic about this acquisition, not just because it creates an opportunity to broaden our presence within our customer base, but also because Azzurri is the ideal match to Avnet Memec." About Avnet Inc. Based in Phoenix, Arizona, Avnet, Inc. -- http://www.avnet.com/-- distributes electronic components and computer products, primarily for industrial customers. It has operations in the following countries: Australia, Belgium, China, Germany, Hong Kong, India, Indonesia, Italy, Japan, Malaysia, New Zealand, Philippines, Singapore, and Sweden, Brazil, Mexico and Puerto Rico. * * * Moody's Investors Service affirmed Avnet's Ba1 corporate family long-term debt ratings in March 2007. Moody's said the outlook is positive. BARNERT HOSPITAL: Has Until April 11 to File Chapter 11 Plan ------------------------------------------------------------ The United States Bankruptcy Court for the District of New Jersey further extended Nathan and Miriam Barnert Memorial Hospital Association dba Barnert Hospital's exclusive periods to: a) file a plan from Dec. 13, 2007, until April 11, 2008; and b) solicit acceptances of that plan from Feb. 11, 2008, until June 10, 2008. As reported in the Troubled Company Reporter on Dec. 19, 2007, the Debtor told the Court that it needs additional time to complete negotiations with creditors and prospective buyers in connection with a sale of the Debtor's assets. "If such negotiations come to fruition, the Debtor will require time to prepare and file pleadings to proceed with a court- approved auction and sale of assets," David J. Adler, Esq., at McCarter & English LLP said. In addition, the Debtor told the Court that the sale of substantially all of its assets, which is pending before the Court, is necessary in the formulation of a plan of reorganization as well as in its exit from Chapter 11. Nathan and Miriam Barnert Memorial Hospital Association, dba Barnert Hospital, owns and operates a 256 bed general acute care community hospital located at 680 Broadway in Paterson, New Jersey. The company filed for chapter 11 protection on Aug. 15, 2007 (Bankr. D. N.J. Case No. 07-21631). David J. Adler, Esq., at McCarter & English, LLP, represents the Debtor in its restructuring efforts. Warren J. Martin Jr., Esq. and John S. Mairo, Esq., at Porzio Bromberg & Newman, P.C., represent the Official Committee of Unsecured Creditors in this case. Donlin Recano & Company Inc. is the Debtor's claims, noticing, and balloting agent. The Debtor's schedules reflect total assets of $46,600,967 and total liabilities of $61,303,505. BIOMET INC: Earn $89 Million in Second Quarter Ended November 30 ---------------------------------------------------------------- Biomet Inc. reported financial results for its second fiscal quarter ended Nov. 30, 2007. The company earned $89 million for the three months ended Nov. 30, 2007, compared to net income of $104.8 million for the same period in 2006. During the second quarter of fiscal year 2008, net sales increased 11% to $578.1 million. Excluding the impact of foreign currency, net sales increased 8% worldwide. Excluding both the impact of foreign currency and instruments, which the Company discontinued selling to distributors in the United States in the third quarter of fiscal 2007, worldwide sales increased 9% during the quarter. As previously announced, on Sept. 25, 2007, Biomet Inc. merged with LVB Acquisition Merger Sub, Inc., a wholly owned subsidiary of LVB Acquisition, Inc. LVB Acquisition, Inc. is indirectly owned by investment partnerships directly or indirectly advised or managed by The Blackstone Group L.P., Goldman Sachs & Co., Kohlberg Kravis Roberts & Co. L.P. and TPG Capital. These financial results have been prepared in a manner that complies, in all material respects, with generally accepted accounting principles in the U.S. with the exception of certain purchase accounting adjustments related to the Merger, including the effects of the merger-related debt and associated interest expense. The company will reflect the purchase accounting adjustments related to the Merger by the end of fiscal year 2008. During the second quarter of fiscal year 2008, the company incurred special charges (pre-tax) of 16.6 million, approximately half of which related to the previously announced operational improvement program. Reported operating income for the second quarter of fiscal year 2008 was $145.7 million compared to operating income of $155.1 million for the second quarter of fiscal year 2007. Adjusted operating income was $162.3 million for the second quarter of fiscal year 2008 compared to $159.1 million for the second quarter of fiscal year 2007. Adjusted net income for the second quarter of fiscal year 2008 was $99.1 million compared to adjusted net income for the second quarter of fiscal year 2007 of US$107.5 million. Adjusted earnings before interest, taxes, depreciation and amortization for the second quarter of fiscal year 2008 was $194.4 million as compared to $182.5 million in the second quarter of fiscal year 2007. Biomet's President and Chief Executive Officer Jeffrey R. Binder stated, "The Company's reconstructive sales category performed very well again this quarter with accelerated growth continuing across various product groups within this category, particularly for knees. In addition, sales of craniomaxillofacial fixation and arthroscopy products were also strong during the second quarter." Mr. Binder added, "We continue to work to strengthen our trauma and spine business. We've built a strong foundation for change and continue to believe we can reach our goal of producing positive revenue growth within the Biomet Trauma and Biomet Spine business during the first half of fiscal year 2009." About Biomet Headquartered in Warsaw, Indiana, Biomet Inc. (NASDAQ: BMET) and its subsidiaries design, manufacture, and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy. Biomet's product portfolio encompasses reconstructive products, fixation products, spinal products, and other products. Biomet and its subsidiaries currently distribute products in more than 100 countries, including the Netherlands, Argentina and Korea. * * * As reported in the Troubled Company Reporter on Sept. 27, 2007, Moody's Investors Service assigned final debt ratings to Biomet Inc. (B2 Corporate Family Rating) in conjunction with the close of the leveraged buy-out transaction by a consortium of equity sponsors. The rating outlook is negative. BASIS YIELD: Judge Gerber Denies Recognition Under Chapter 15 ------------------------------------------------------------- The Hon. Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York denies the summary judgment request of Hugh Dickinson, Stephen John Akers, and Paul Andrew Billingham, as joint official liquidators of Basis Yield Alpha Fund (Master), for recognition of the company's Cayman Islands liquidation proceeding as a "foreign main proceeding," under Section 1517(b)(1) of the U.S. Bankruptcy Code or as a "foreign nonmain proceeding" under Section 1517(b)(2). Judge Gerber has previously ruled that any hearing on the Liquidators' Chapter 15 Petition will be an evidentiary hearing. Judge Gerber required the Liquidators to provide relevant evidence to make factual findings relevant to determining whether the Cayman Islands were Basis Yield's "center of main interest," or whether Basis Yield maintained an establishment there. The Liquidators, however, have argued that, with no objections filed, there is no evidence which contradicts that Basis Yield's COMI is the Cayman Islands. In their Summary Judgment Motion, the Liquidators maintained that, because their is no evidence to the contrary, under Section 1516(a), they are entitled to a presumption that Cayman Islands is Basis Yield's COMI. In the Chapter 15 Petition, the Liquidators have stated that: * Basis Yield is registered in the Cayman Islands and maintains its registered office there; * its only "investors," are two feeder funds, which are both domiciled in the Cayman Islands; * Fortis Prime Fund Solutions (Cayman) Ltd., a Cayman Islands company, serves as administrator to both Basis Yield and each of its feeder funds; * Pac-Rim Investments, Ltd., also a Cayman Islands company, is Basis Yield's investment manager; * Basis Yield's pre-Chapter 15 petition attorneys and auditor, Walkers and Ernst & Young, are Cayman Islands entities; and * the hedge fund's financial books and records, including the investor register, are currently located in the Cayman Islands. In a 28-page memorandum, signed January 16, 2008, Judge Gerber says none of the papers filed by the Liquidators have addressed, in any meaningful way, any of the factors that would support recognition of Basis Yield's Cayman Islands as a foreign main proceeding. Judge Gerber notes that the Liquidators have been "strikingly silent" as to the nature or extent of any business activity Basis Yield conducts in the Cayman Islands. He adds that they were silent, among other things, as to whether Basis Yield staffed any employees or managers in the Cayman Islands; whether any of its assets were in the Cayman Islands; and the location from which Basis Yield's funds were in fact managed. "The Liquidators' conspicuous failure to try to establish, or even plead, facts supporting the existence of a main proceeding, even after the submission of the comments of one of its creditors, Citigroup Global Markets Ltd., makes any reasonable observer wonder why," Judge Gerber says. Judge Gerber further notes that the Liquidators' Summary Judgment Motion raises the issues as to: (1) whether failure to object by stakeholders divest the Court of the power to make its own determination as to whether the requirements of Section 1517 have been satisfied; and (2) whether a presumption embodied in Section 1516 precludes the Court from considering the actual facts -- under circumstances where the Liquidators's showing has been strikingly silent and where the few facts that are known raise issues as to their position and make further inquiry appropriate. Judge Gerber states that he cannot endorse the Liquidators' reliance on Section 1516(c) in their argument that they are entitled to a presumption that Basis Yield's COMI is in Cayman Islands for two reasons: (a) there is enough "evidence to the contrary" -- organization of Basis Yield under a Cayman Islands stature that raises red flags as to whether that jurisdiction could be the fund's COMI -- to decline use of a Section 1516 presumption as a substitute for actual evidence; and (b) the Court has the power to satisfy itself that the requirements for recognition under Section 1517 have been satisfied, and has a right like any other federal court to inquire under Rule 614 of the U.S. Federal Rules of Evidence. Judge Gerber concurs with the observations of Judge Lifland in In re Bear Stearns High-Grade Structured Credit Strategies Master Fund, Ltd., 374 B.R. 122, 130 (Bankr. S.D.N.Y. 2007), that recognition under Section 1517 is not a "rubber stamp exercise." Rather, consistent with Judge Lifland's determination in Bear Stearns' case and the views of the drafters of Chapter 15 and the United Nations Commission on International Trade Law on which chapter 15 was based, Judge Gerber rules that a court engaging in a recognition determination under Section 1517 is not bound by parties' failure to object. Judge Gerber says he needs to consider all relevant facts, including facts that are not yet presented before granting Chapter 15 Petition. He further concludes that Basis Yield is not yet entitled to Chapter 15 recognition as a matter of law, but makes clear that he does not, in any way, rule out the possibility that facts could be adduced at an evidentiary hearing sufficient to entitle Basis Yield recognition under Chapter 15. The Court will hold the evidentiary hearing on the Chapter 15 Recognition Motion at the earliest practical time consistent with the requirements of Section 1517(c). The Liquidators' evidentiary presentations will be made in accordance with the Case Management Order, dated September 5, 2007, subject to an adjustment of time with respect to the submission of direct testimony affidavits, which will be submitted early enough to permit the Court to advise the Liquidators of any desire to call witnesses whose testimony has not already been set forth by affidavit. Judge Gerber also reinstates duties under the Factual Matters Order, dated September 12, 2007. About Basis Yield Basis Yield Alpha Fund (Master) is a Cayman Islands mutual fund. It operates as a master-feeder structure that allows investors' funds to be channeled through two companies operating in a single jurisdiction to a "master" company operating in the same jurisdiction. These two feeder funds are Basis Yield Alpha Fund (US), a US feeder fund for US taxable investors, and Basis Yield Alpha Fund, a non-US feeder for all other investors. On Aug. 29, 2007, Hugh Dickson, Stephen John Akers, and Paul Andrew Billingham filed a chapter 15 petition for Basis Yield (Bankr. S.D.N.Y. Case No. 07-12762). Karen Dine, Esq. at Pillsbury Winthrop Shaw Pittman LLP represents the petitioners. (Basis Yield Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/or 215/945-7000). BEAR STEARNS: Fitch Holds 'B-' Rating on $10.8MM Class K Certs. --------------------------------------------------------------- Fitch Ratings has affirmed Bear Stearns Commercial Mortgage Securities, commercial mortgage pass-through certificates, series 1999-WF2, as: -- $501.7 million class A-2 at 'AAA'; -- Interest only class X at 'AAA'; -- $43.2 million class B at 'AAA'; -- $43.2 million class C at 'AAA'; -- $10.8 million class D at 'AAA'; -- $27 million class E at 'AA+'; -- $10.8 million class F at 'AA'; -- $21.6 million class G at 'A-'; -- $16.2 million class H at 'BBB-'; -- $8.1 million class I at 'BB'; -- $9.5 million class J at 'B+'; -- $10.8 million class K at 'B-'. The $2.4 million class L remains 'C/DR5'. Class A-1 has paid in full. The affirmations reflect stable performance of the transaction. As of the December 2007 distribution date, the pool's aggregate principal balance has been reduced 34.7%, to $705.4 million from $1.08 billion at issuance. Fifty-six loans (25.4%) have defeased, including three of the 10 largest loans (5.6%). Currently, there are no delinquent or specially serviced loans. There are 135 non-defeased loans (55.2%) are scheduled to mature within the next 24 months, of which 130 reported year-end 2006 financial information. The loans have interest rates ranging from 5.70% to 8.99% and reported a year-end 2006 weighted average debt service coverage ratio of 2.04 times. BEAR STEARNS: Limited Paydown Cues Fitch to Affirm Ratings ---------------------------------------------------------- Fitch has affirmed Bear Stearns Commercial Mortgage Securities Trust's commercial mortgage pass-through certificates, series 2006-PWR14, as: -- $102.4 million class A-1 at 'AAA'; -- $170.7 million class A-2 at 'AAA'; -- $68.9 million class A-3 at 'AAA'; -- $125.1 million class A-AB at 'AAA'; -- $950.9 million class A-4 at 'AAA'; -- $296.9 million class A-1A at 'AAA'; -- $246.8 million class A-M at 'AAA'; -- $222.1 million class A-J at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- Interest-only class X-W at 'AAA'; -- $46.3 million class B at 'AA'; -- $24.7 million class C at 'AA-'; -- $37.0 million class D at 'A'; -- $21.6 million class E at 'A-'; -- $24.7 million class F at 'BBB+'; -- $24.7 million class G at 'BBB'; -- $24.7 million class H at 'BBB-'; -- $9.3 million class J at 'BB+'; -- $6.2 million class K at 'BB'; -- $9.3 million class L at 'BB-'; -- $3.1 million class M at 'B+'; -- $6.2 million class N at 'B'; -- $6.2 million class O at 'B-'. Fitch does not rate class P. The affirmations are due to the pool's stable performance and limited paydown since issuance. As of the January 2008 distribution date, the pool's aggregate principal balance has decreased 0.52% to $2.46 billion from $2.47 billion at issuance. There have been no specially serviced or delinquent loans since issuance. There are nine shadow rated loans. South Bay Galleria (4.02%), 750 Lexington Avenue (3.05%), Plaza Fiesta (1.30%), Northgate Plaza Retirement (0.41%), Tumwater Industrial Facility (0.38%), Calaveras Shopping Center (0.36%), 700-760 First Street (0.35%), Island House Retirement Apartments (0.27%), and Residence Inn Louisville Airport (0.25%). Fitch reviewed YE06 operating statement analysis reports and other performance information provided by the master servicers. Occupancy was in-line or improved from issuance. Occupancy as of 2Q07 for Tumwater Industrial Facility, Island House Retirement Apartments, Northgate Plaza Retirement Apartments, and Residence Inn Louisville Airport was 100%, 90.0%, 84.3%, and 69.1%, respectively. Occupancy as of 3Q07 for 700-760 First Street, Plaza Fiesta, South Bay Galleria, and 750 Lexington Avenue was 100%, 100%, 99.4%, and 95.0%. For YE07, Calaveras Shopping Center maintained 100% occupancy. BENCHMARK ELECTRONICS: Earns $22 Million in 2007 Third Quarter -------------------------------------------------------------- Benchmark Electronics Inc. reported net income of $22.0 million for the third quarter ended Sept. 30, 2007, which included a discrete tax benefit of $6.0 million relating to a previously closed facility. In the comparable period of 2006, net income was $29.3 million. Sales were $672.6 million for the quarter ended Sept. 30, 2007, compared to $769.5 million for the same quarter in the prior year. Excluding restructuring charges, integration costs, amortization of intangibles, the impact of stock-based compensation costs and the tax benefit, the company would have reported net income of $17.0 million in the third quarter of 2007. Excluding restructuring charges and the impact of stock-based compensation costs, the company would have reported net income of $30.0 million in the third quarter of 2006. "We are clearly disappointed with our revenue performance for the third quarter," said Cary T. Fu, the company's chief executive officer. "However, as our fourth quarter guidance reflects, we continue to believe that Benchmark is well positioned for the future based on our operating focus and execution, new program bookings and continued strong cash flows from operations." Looking forward, sales for the fourth quarter of 2007 are expected to be between $700.0 million and $740.0 million. Diluted earnings per share for the fourth quarter, excluding restructuring charges, integration costs, amortization of intangibles and the impact of stock-based compensation expense, are expected to be between $0.32 and $0.38. Operating margin for the third quarter was 2.2% on a GAAP basis and was 2.6%, excluding restructuring charges, integration costs, amortization of intangibles and the impact of stock-based compensation expense. Selling, general and administrative expenses for the third quarter were $22.0 million, a decrease of 9.2% from the second quarter of 2007. Cash flows provided by operating activities for the third quarter were approximately $66.0 million. Cash and short-term investments balance was $379.0 million at Sept. 30, 2007. Total debt outstanding at Sept. 30, 2007, was $12.8 million. Balance Sheet At Sept. 30, 2007, the company's consolidated balance sheet showed $1.78 billion in total assets, $460.1 million in total liabilities, and $1.32 billion in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2736 About Benchmark Electronics Headquartered in Angleton, Texas, Benchmark Electronics Inc. (NYSE: BHE) -- http://www.bench.com/-- is in the business of manufacturing electronics and provides its services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment, testing and instrumentation products, and telecommunication equipment. * * * As reported in the Troubled Company Reporter on Jan. 21, 2008, Moody's Investors Service assigned a Ba2 (LGD-3, 39%) rating to Benchmark Electronics Inc.'s new 5-year $100 million senior secured revolving credit facility due 2012 and affirmed the company's Ba3 corporate family rating. The rating outlook is stable. BOMBARDIER INC: $1BB Debt Redemption Cues Fitch to Lift Ratings --------------------------------------------------------------- Fitch Ratings has upgraded Bombardier Inc.'s ratings and removed the ratings from Rating Watch Positive following BBD's early redemption of approximately $1 billion of debt. The Rating Outlook is Positive. Fitch's rating actions are summarized as: Bombardier Inc. -- Issuer Default Rating to 'BB' from 'BB-'; -- Senior unsecured debt to 'BB' from 'BB-'; -- Preferred stock to 'B+' from 'B'. In addition, Fitch has upgraded the IDR and senior unsecured debt rating for Bombardier Capital Inc. to 'BB' from 'BB-' and withdrawn the ratings. BC has retired nearly all of its remaining debt. BC's ratings were linked to those of BBD due to the existence of a support agreement and demonstrated support by the parent. The ratings for BBD affect debt and preferred stock that totaled approximately $4.6 billion on a pro forma basis as of Oct. 31, 2007. The rating upgrades reflect the completion of BBD's plan, announced in November 2007, to reduce debt by approximately $1 billion by the end of its fiscal year ending Jan. 31, 2008. Fitch estimates that BBD's pro forma debt/EBITDA at Oct. 31, 2007 declined to 3.2 times, compared to nearly 4x as reported. The ratings and Positive Outlook are supported by continuing expectations for margin improvement, sales growth, and solid cash generation. Strong orders in all of BBD's businesses, together with a large backlog, support projections for ongoing progress in BBD's operating performance. These factors could potentially lead to further long-term improvement in BBD's credit profile. Additional factors supporting the ratings include BBD's diversification, its leading market positions, the health of the business jet and turboprop markets, BBD's cash balances, its debt maturity schedule, BT's successful restructuring, and a large backlog. Rating concerns include relatively low operating margins; business jet market cyclicality; the pension plan deficit; the impact of exchange rate volatility on margins, financial results, and planning; and several RJ concerns, including uncertainty regarding development of new aircraft models and contingent obligations related to past aircraft sales, although these contingent obligations are spread out over time and are not a near-term concern. BBD's eventual decision about its potential entry into the mainline aircraft market could have an impact on its financial and operating profile. Even after the recent use of cash to reduce debt, BBD maintains strong cash balances that are sufficient to support its liquidity requirements. The company's $3.6 billion of unrestricted cash balances at Oct. 31, 2007 would be reduced on a pro forma basis by the recent debt repurchase. However, cash balances do not include $1.3 billion of restricted cash related to a letter of credit facility. In addition, the company can be expected to support its cash position from operating cash flow that contributed to an increase of roughly $400 million in BBD's net cash balances during the fiscal third quarter. The debt redeemed yesterday by BBD included approximately $407 million of Euro-denominated 5.75% notes due in February 2008 and $619 million of BC's Sterling-denominated 6.75% notes due in May 2009. BBD also planned to repurchase $26 million of other long-term debt. The repurchased debt amounted to approximately 20% of BBD's consolidated debt reported at Oct. 31, 2007. BRUTI ASSOCIATES: Case Summary & 19 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Bruti Associates Ltd. 21146 Washington Parkway Frankfort, IL 60423 Bankruptcy Case No.: 08-01064 Type of Business: The Debtor buys and sells realty property. Chapter 11 Petition Date: January 18, 2008 Court: Northern District of Illinois (Chicago) Judge: Pamela S. Hollis Debtors' Counsel: Douglas C. Giese, Esq., and Lewis J Todhunter, Esq. Defrees & Fiske LLC 200 S. Michigan Avenue Chicago, IL 60604 Tel: (312) 372-4000 Ext. 229 Fax: (312) 939-5617 http://www.defrees.com/ Estimated Assets: Less than $50,000 Estimated Debts: $10 million to $50 million Consolidated Debtors' List of 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Shore Development Co. $2,780,769 c/o S Cooper Cooper Storm & Piscopo 117 S Second St Geneva, IL 60134 First United Bank $600,000 7626 W. Lincoln Highway Frankfort, IL 60423 First Community Bank vehicle; value of $575,545 P.O. Box 457 security: $5,000 Beecher, IL 60401-0457 Charles P. Bruti $191,782 Joseph A. Schudt & $160,000 Bruti Associates Profit $130,000 Trevarthan Landscaping $101,000 Barbara J. Bruti $70,000 David J Martin $60,000 G & M Masonry Construction $33,847 Dresden Concrete $29,497 Bailey's Carpet $26,724 V & L Plumbing Co. $26,521 Tidal Construction Services $22,512 Excel Electric Inc. $17,490 Advanta Bank $15,740 James J Johnson $18,939 Wilson Heating & Air $17,278 MT Carmel Lime $16,000 BUFFETS HOLDINGS: Board Vice-Chairman Roe H. Hatlen Resigns ----------------------------------------------------------- Buffets Holdings Inc. disclosed in a regulatory filing with the Securities and Exchange Commission that on Jan. 11, 2008, Roe H. Hatlen, vice-chairman of the company's Board of Directors, notified the company of his decision to resign from the company's Board and the Board of Directors of subsidiary Buffets Inc., effective immediately. Mr. Hatlen was a member of the company's Audit Committee. Mr. Hatlen will continue to serve as an advisor to the company under the terms of an advisory agreement he previously entered into with the company, which agreement was amended in connection with his resignation to: (i) acknowledge that the agreement may be terminated by either party upon 30 days prior written notice; and (ii) limit the scope of services to be provided by Mr. Hatlen under the agreement to those that he is requested to perform by the company's Chief Executive Officer or such other officer designated by the Chairman of the company's Board of Directors. About Buffets Holdings Headquartered in Eagan, Minnesota, Buffets Holdings Inc., is the holding company of Buffets Inc. -- http://www.buffet.com/-- which operates 626 restaurants in 39 states, comprised of 615 steak-buffet restaurants and eleven Tahoe Joe's Famous Steakhouse(R) restaurants, and franchises sixteen steak-buffet restaurants in six states. The restaurants are principally operated under the Old Country Buffet(R), HomeTown Buffet(R), Ryan's(R) and Fire Mountain(R) brands. Buffets employs approximately 37,000 team members and serves approximately 200 million customers annually. * * * As reported in the Troubled Company Reporter on Jan. 15, 2008, Standard & Poor's Ratings Services said its ratings on Buffets Holdings Inc. (Buffets; D/--/--) are unaffected by the company's announcement that it reached a forbearance agreement with lenders of its senior secured credit facility. These lenders have effectively agreed to waive their default rights during the forbearance period (which will likely end on April 2, 2008, unless the company breaches certain provisions of the agreement). The agreement stipulates that the company cannot make any voluntary payments to its senior noteholders and also specifies that on or before Jan. 31, 2008, the company will present to its lenders reasonably detailed terms of its restructuring plan. These conditions make clear that Buffets will not pay interest due Jan. 2, 2008, to its senior noteholders by Jan. 31, 2008 (the end of the cure period). The rating on the company's senior secured credit facility is 'CC', the highest rating for a security with a 'D' corporate credit rating that has not filed for bankruptcy protection. C AND C PROP: Court Approves Adequacy of Disclosure Statement ------------------------------------------------------------- The United States Bankruptcy Court for the Southern District of Mississippi approved the adequacy of C and C Properties Inc. and its debtor-affiliates' Joint Disclosure Statement describing their Joint Chapter 11 Plan of Reorganization. As reported in the Troubled Company Reporter on Dec. 14, 2007, the Debtors' Plan contemplates the liquidation of their assets, including the sale of four convenience stores and some of their affiliates' assets. The Debtors have escrowed the sale proceeds and will distribute to their valid creditors. Treatment of Claims Under the Plan, all administrative claims filed against the Debtors will be paid in full. Construction Liens Claim of Commercial Construction and Maintenance, totaling $38,419, will be paid in full on the plan's confirmation date. General Unsecured Claims will also be paid in full after the Court enter an order confirming the Debtors' joint plan. Equity security holders of the Debtors, COC Holdings Inc. and Robert W. Carleton III, will have their ownership interest extinguished in accordance with the terms and provision of the proposed joint plan. Harold G. Carleton and Robert W. Carleton Jr. have been classified as insiders of the Debtors. Robert Carleton III, Harold Carleton and R. W. Carleton Jr., will be entitled to receive a pro rata share, to the extent possible, from the remaining proceeds after all valid claims have been paid. Secured Claims Professional Convenience Services Inc. and GOC Ltd. will be resolved pursuant to the terms and provisions of a motion for authority to settle and compromise disputed claim which is pending at the Court. If approved, the motion will be incorporated into the Debtors' joint disclosure statement and proposed plan. Citizens Bank of Philadelphia's claim has been satisfied in accordance with the sale of the Debtors' assets. Madison County Bank will be paid from the sale and liquidation of the M&K Convenience Store. The remaining balance of the Madison County's secured claim approximately $192,000 is secured by a certain property owned by the Debtors. Accordingly, the Debtors will transfer that certain property to Robert Carleton III who will assume the indebtedness with the bank. The Debtors say that New County Bank's secured claim comprised of a 2003 Ford F-350 truck that has a balance due of $7,878 and a $71,007 loan secured by certain convenience store equipment. Under the Plan, the Debtors will continue to pay monthly installments on the Ford truck and will seek a purchaser for the collateral to liquidate in order to pay the balance in full due to Newton County. At the Debtors' discretion, the loan will be paid in full, either, monthly or lump sum payment, if no purchaser is secured. The Debtors further say that Newton County will entitled to receive approximately $52,000 from the sale of that certain convenience store equipment. A portion of Ford Motor Credit Company's secured claims have been paid in accordance with the Court order issued Oct. 22, 2007, on Ford Motor's request to compel assumption or rejection of the executory lease contract and releif from automatice stay. Priority Claims Mississippi State Tax Commission holds a $32,000 claim in the Debtors' case for December and January petroleum taxes. MTSC has a $631,727 proof of claim, which appears to duplicate the petroleum taxes due, according to the Debtors. Additionally, MSTC has filed a $20,980 claim for sales tax against the Debtors. The Debtors tells the Court that they will object to these claims if the Debtors and MSTC cannot reach an agreement as to the proper amount of MSTC's asserted claims. Internal Revenue Service's claims will be paid in full on the plan confirmation date. The Debtors say that Majority of the Ad Valorem Tax Claims for 2006 have been paid as part of the closing of the various sales of real property but approximately $12,000 is still due to various tax authorities. About C and C Properties Based in Union, Mississippi, C and C Properties, Inc. develops real estate properties. The company filed for Chapter 11 protection on January 24, 2007 (Bankr. S.D. Miss. Case No. 07-50082). Jeffery Kyle Tyree, Esq. and Melanie T. Vardaman, Esq., at Harris Jernigan & Geno, PPLC, represent the Debtor in its restructuring efforts. The U.S. Trustee for Region 5 has not appointed an Official Committee of Unsecured Creditors in the Debtor's bankruptcy proceedings. In its schedules filed with the Court, the Debtor disclosed total assets of $12,500,000 and total debts of $10,016,965. C-BASS MORTGAGE: S&P Junks Ratings on Four Certificate Classes -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on eight classes of asset-backed pass-through certificates from four C-BASS Mortgage Loan Asset-Backed Certificates transactions. Two of the classes were downgraded to speculative-grade from investment-grade. Concurrently, S&P affirmed its ratings on the remaining classes of asset-backed pass-through certificates from these four series. The current performance data of the four series are: Performance Data Cum. realized Severe Series losses (i) delinq. (ii) ------ ------------- ------------ 2002-CB1 6.50% 24.61% 2002-CB2 3.55% 15.60% 2003-RP1 10.89% 36.75% 2005-RP1 3.54% 25.68% (i) As a percentage of original pool balance. (ii) As a percentage of current pool balance. Current pool bal. Months Series (percentage of orig. pool bal.) seasoned ------ ------------------------------- -------- 2002-CB1 9.58% 69 2002-CB2 10.65% 67 2003-RP1 21.45% 53 2005-RP1 42.17% 30 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 the credit support derived from subordination. As shown in the performance data above, cumulative realized losses as a percentage of original pool balances, ranged from 3.54% (series 2005-RP1) to 10.89% (series 2003-RP1). As of the January 2008 remittance period, O/C was below its target for all four series. 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 15.60% (series 2002-CB2) to 36.75% (series 2003-RP1). 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 reperforming, adjustable- and fixed-rate mortgage loans secured by first liens on one- to four-family residential properties. Ratings Lowered C-BASS Mortgage Loan Asset-Backed Certificates Mortgage loan asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2002-CB2 M-2 BBB AA 2002-CB2 B-1 CCC B 2002-CB2 B-2 CCC B 2003-RP1 M-2 BBB- A 2003-RP1 B-1 B BBB- 2005-RP1 B-2 BB BBB Ratings Lowered and Removed From CreditWatch Negative C-BASS Mortgage Loan Asset-Backed Certificates Mortgage loan asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2002-CB1 B-2 CCC B/Watch Neg 2003-RP1 B-2 CCC BB/Watch Neg Ratings Affirmed C-BASS Mortgage Loan Asset-Backed Certificates Mortgage loan asset-backed certificates Series Class Rating ------ ----- ------ 2002-CB1 M-2 AAA 2002-CB1 B-1 BBB 2002-CB2 A-1, A-2, M-1 AAA 2003-RP1 A AAA 2003-RP1 M-1 AA 2005-RP1 AF-1A, AF-1B, AF-2 AAA 2005-RP1 AF-3, AV AAA 2005-RP1 M-1 AA 2005-RP1 M-2 A 2005-RP1 M-3 A- 2005-RP1 B-1 BBB+ CABELA'S CREDIT: Fitch Rates $11.25MM Class D Notes at BB+ ---------------------------------------------------------- Fitch has rated these Cabela's Credit Card Master Note Trust, series 2008-I asset-backed notes: -- $202,650,000 Class A-1 Fixed Rate Notes 'AAA'; -- $229,850,000 Class A-2 Floating Rate Notes 'AAA'; -- $29,000,000 Class B-1 Fixed Rate Notes 'A+'; -- $6,000,000 Class B-2 Floating Rate Notes 'A+'; -- $21,250,000 Class C-2 Floating Rate Notes 'BBB+'; -- $11,250,000 Class D Floating Rate Notes 'BB+'. CARRINGTON MORTGAGE: S&P Junks Ratings on Two Classes from 'B' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 13 classes of mortgage-backed securities issued by four Carrington Mortgage Loan Trust transactions. In addition, S&P affirmed its ratings on the remaining classes from these series. The downgrades reflect credit enhancement levels that are insufficient to support the current ratings given the level of severe delinquencies (90-plus days, foreclosures, and REOs) for each of the transactions. The transactions have sizeable loan amounts that are severely delinquent, which suggests that performance trends are likely to deteriorate. The severe delinquencies relative to overcollateralization (O/C) are (series: severe delinquency amount {$}; % of current pool balance; multiple of O/C): -- 2004-NC2: $6.929 million; 16.84%; 2.58x; -- 2005-FRE1: $133.013 million; 31.80%; 6.64x; -- 2005-NC2: $48.029 million; 30.18%; 2.22x; and -- 2005-OPT2: $112.825 million; 29.15%; 2.81x. These severely delinquent loan amounts have increased significantly over year-ago levels (series: multiple of December 2006 amount): -- 2004-NC2: 1.14x; -- 2005-FRE1: 2.40x; -- 2005-NC2: 3.31x; and -- 2005-OPT2: 1.39x. As of the December 2007 remittance report, cumulative realized losses for the deals were (series: realized losses {$}; % of original pool balance): -- 2004-NC2: $1,434,769; 0.48%; -- 2005-FRE1: $6,617,699; 0.73%; -- 2005-NC2: $2,859,690; 0.40%; and -- 2005-OPT2: $11,527,167; 0.77%. Losses for the transactions have been relatively moderate to date; however, the increases in delinquencies indicate that current performance trends may further compromise credit support for the downgraded classes. Credit support for these transactions is provided through a combination of subordination, excess interest, and O/C. All of the transactions have "NC," "OPT," or "FRE" suffixes, indicating that the loans were originated by New Century Mortgage Corp., Option One Mortgage Corp., and Fremont Investment & Loan, respectively. At closing, collateral for the transactions consisted of a mix of adjustable- and fixed-rate, interest-only and fully amortizing, first- and second-lien subprime mortgage loans. Those deals with IO loans had IO periods, which initially ranged from 36 to 84 months. Ratings Lowered Carrington Mortgage Loan Trust Mortgage-backed securities Rating ------ Series Class To From ------ ----- -- ---- 2004-NC2 M-5 BBB- BBB 2004-NC2 M-6 BB BBB- 2005-FRE1 M-9 BBB- BBB 2005-FRE1 M-10 B+ BBB 2005-FRE1 M-11 B BB 2005-FRE1 M-12 CCC B 2005-FRE1 M-13 CCC B 2005-NC2 M-8 BBB- BBB 2005-NC2 M-9 B BBB- 2005-OPT2 M-6 BBB+ A- 2005-OPT2 M-7 BB+ BBB+ 2005-OPT2 M-8 BB- BBB 2005-OPT2 M-9 B BB Ratings Affirmed Carrington Mortgage Loan Trust Mortgage-backed securities Series Class Rating ------ ----- ------ 2004-NC2 M-1 AA 2004-NC2 M-2 A 2004-NC2 M-3 A- 2004-NC2 M-4 BBB+ 2005-FRE1 A-3, A-4, A-5, A-6 AAA 2005-FRE1 M-1 AA+ 2005-FRE1 M-2 AA 2005-FRE1 M-3 AA- 2005-FRE1 M-4 A+ 2005-FRE1 M-5, M-6 A 2005-FRE1 M-7 A- 2005-FRE1 M-8 BBB+ 2005-NC2 M-1 AA+ 2005-NC2 M-2, M-3 AA 2005-NC2 M-4 A+ 2005-NC2 M-5 A 2005-NC2 M-6 A- 2005-NC2 M-7 BBB+ 2005-OPT2 A-1D AAA 2005-OPT2 M-1, M-2 AA 2005-OPT2 M-3, M-4 A+ 2005-OPT2 M-5 A CHEC LOAN: S&P Junks Rating on Class B-2 Securities From 'BB' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on four classes of mortgage-backed securities issued by CHEC Loan Trust's series 2004-1 and 2004-2. Furthermore, S&P placed its rating on one additional class on CreditWatch with negative implications and affirmed its ratings on the remaining classes from these transactions. The downgrades reflect credit enhancement levels that are insufficient to support the current ratings given the level of severe delinquencies (90-plus days, foreclosures, and REOs) and accelerating losses for each of the transactions. The transactions have sizable loan amounts that are severely delinquent, which suggests that performance is likely to deteriorate. The severe delinquencies relative to overcollateralization (O/C) are (series: severe delinquency amount {$}; percentage of current pool balance; multiple of O/C): -- 2004-1: $12.811 million; 17.01%; 9.91x; and -- 2004-2: $18.320 million; 21.69%; 4.93x. Both transactions have severely delinquent loan amounts that are 1%-2% higher than year-ago levels. Average losses for both transactions have increased significantly over the same time period (series: three-month average {$}; six-month average {$}; 12-month average {$}): -- 2004-1: $237,300; $168,226; $161,596; and -- 2004-2: $285,961; $240,028; $195,349. As of the December 2007 remittance report, cumulative realized losses for the deals were (series: realized loss {$}; percentage of original pool balance): -- 2004-1: $2,708,618; 0.88%; and -- 2004-2: $2,966,234; 0.96%. Series 2004-1 and 2004-2 have started to step down over the past several months, with 41 and 38 months of seasoning, respectively. This reduction in credit support, in combination with accelerating losses and consistently significant severely delinquent loan amounts, indicate that credit support will continue to deteriorate going forward. The placement of the rating on class M-6 from series 2004-2 on CreditWatch with negative implications reflects the possibility for deterioration of the subordination that provides support for this class due to the deal stepping down. Standard & Poor's will continue to closely monitor the performance of class M-6 from series 2004-2. If credit support for class M-6 is adequate to support the current rating, S&P will affirm the rating and remove it from CreditWatch. Conversely, if credit support continues to deteriorate to a point at which it is insufficient to maintain the current rating, S&P will take further negative rating action. Credit support for these transactions is provided through a combination of subordination, excess interest, and O/C. The collateral for both transactions consists primarily of fixed- and adjustable-rate, fully amortizing, and balloon mortgage loans secured by first liens on one- to four-family residential properties. Ratings Lowered CHEC Loan Trust Asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2004-1 B-1 B+ BB+ 2004-1 B-2 CCC BB 2004-2 M-7 BB BBB 2004-2 M-8 B BBB- Rating Placed on CreditWatch Negative CHEC Loan Trust Asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2004-2 M-6 BBB+/Watch Neg BBB+ Ratings Affirmed CHEC Loan Trust Asset-backed certificates Series Class Rating ------ ----- ------ 2004-1 A-3 AAA 2004-1 M-1 AA+ 2004-1 M-2 AA 2004-1 M-3 AA- 2004-1 M-4 A+ 2004-1 M-5 A 2004-1 M-6 A- 2004-1 M-7 BBB+ 2004-1 M-8 BBB 2004-1 M-9 BBB- 2004-2 A-3 AAA 2004-2 M-1 AA+ 2004-2 M-2 AA 2004-2 M-3 AA- 2004-2 M-4 A 2004-2 M-5 A- CLAYMONT STEEL: Evraz Completes Tender Offer for Common Stock ------------------------------------------------------------- Claymont Steel Holdings Inc. disclosed that the cash tender offer of Evraz Group S.A.'s subsidiary, Titan Acquisition Sub Inc., to purchase all outstanding shares of common stock of Claymont Steel, which expired at midnight, New York City time, on Jan. 16, 2008, has been completed. Evraz and Titan Acquisition Sub Inc. have been advised by Mellon Investor Services LLC, the depositary for the tender offer, that as of the expiration of the offer, stockholders of Claymont Steel had tendered into the tender offer 16,415,722 shares of Claymont Steel common stock, excluding shares delivered pursuant to notices of guaranteed delivery, representing approximately 93.4% of the outstanding shares of common stock of Claymont Steel. Evraz has accepted for payment all shares of Claymont Steel common stock that were validly tendered during the offer period. In accordance with the merger agreement, Evraz now intends to effect a short-form merger. Pursuant to the merger agreement, each share of Claymont Steel common stock not accepted for payment in the tender offer, other than those as to which holders validly exercise dissenters' rights and those held by Evraz or Claymont Steel or their respective subsidiaries, will be converted in the merger into the right to receive $23.50 in cash, without interest thereon and less any applicable stock transfer taxes and withholding taxes. This is the same price per share paid during the tender offer. Evraz intends to complete the short-form merger in the next several days. About Evraz Headquartered in Luxembourg, Evraz Group S.A. (LSE:EVR) -- http://www.evraz.com/-- manufactures and distributes steel and related products. In addition, the Company owns and operates certain mining assets. Its steel production and mining facilities are mainly located in the Russian Federation. It operates three steel mills in Russia, one mill in the Sverdlovsk region and two mills in the Kemerovo region. About Claymont Steel Headquartered in Claymont, Delaware, Claymont Steel Inc. -- http://www.claymontsteel.com/-- fka CitiSteel USA Inc., mills carbon steel plate. It services all major plate markets including service centers, bridge fabricators, railcar manufacturers, heavy construction machinery and material handling equipment, mining equipment, storage tanks, pressure vessel, and shipbuilding. It produces somewhere near 400,000 tons per year. The company sells its products to clients in Canada and the US. Previously a subsidiary of CITIC Group, Claymont Steel (as CitiSteel USA) was acquired by H.I.G. Capital, a private equity and venture capital investment firm in 2005. H.I.G. formed Claymont Steel Holdings in 2006 with the intent to take the company public. * * * As reported in the Troubled Company Reporter on Dec. 12, 2007, Moody's Investors Service placed all of its ratings, including its 'B' corporate credit rating, on Claymont Steel Inc. on CreditWatch with positive implications following the announcement that Evraz Group S.A., through its wholly owned subsidiary Titan Acquisition Sub, Inc., has entered into a definitive agreement under which Evraz will acquire Claymont Steel for $23.50 per share, for an aggregate purchase price of approximately $565 million, including debt. If Claymont's debt is retired as a result of the transaction, its ratings will be withdrawn. CONCORD RE: S&P Withdraws BB+ Rating on $365 Million Bank Loan -------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its 'BB+' rating on Concord Re Ltd.'s $365 million bank loan. The company repaid all outstanding amounts and terminated the facility. CONGOLEUM CORP: Sept. 30 Balance Sheet Upside-Down by $44.9 Mil. ---------------------------------------------------------------- Congoleum Corporation's consolidated balance sheet at Sept. 30, 2007, showed $185.9 million in total assets and $230.8 million in total liabilities, resulting in a $44.9 million stockholders' deficit. The company reported net income of $1.2 million for the third quarter ended Sept. 30, 2007, versus a net loss of $413,000 million in the third quarter of 2006. Sales for the three months ended Sept. 30, 2007, were $53.6 million, compared with sales of $57.5 million reported in the third quarter of 2006, a decrease of 6.7%. Sales for the nine months ended Sept. 30, 2007, were $160.4 million, compared with sales of $173.4 million in the first nine months of 2006. Net income for the nine months ended Sept. 30, 2007, was $1.7 million, versus net income of $413,000 in the first nine months of 2006. Roger S. Marcus, Chairman of the Board, commented, "Third quarter shipments were well below year earlier levels, although a price increase we instituted in the second quarter of this year helped mitigate the lower unit volumes. Net results for the quarter, however, improved considerably due to better gross margins coupled with operating expense reductions." Unrestricted cash and cash equivalents, including short-term investments at Sept. 30, 2007, were $25.6 million, an increase of $7.0 million from Dec. 31, 2006. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2731 About Congoleum Corp. Based in Mercerville, New Jersey, Congoleum Corporation (AMEX:CGM) -- http://www.congoleum.com/-- manufactures resilient flooring, serving both residential and commercial markets. Congoleum is a 55% owned subsidiary of American Biltrite Inc. The company filed for chapter 11 protection on Dec. 31, 2003 (Bankr. D.N.J. Case No. 03-51524) as a means to resolve claims asserted against it related to the use of asbestos in its products decades ago. Paul S. Hollander, Esq., at Okin, Hollander & Deluca, and Richard L. Epling, Esq., Leo T. Crowley, Esq., Kerry A. Brennan, Esq., Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP, represent the Debtor. On Jan. 18, 2008, an amended reorganization plan was filed by the future claimants' representative in the company's Chapter 11 proceedings. A hearing to consider the adequacy of the disclosure statement describing the plan is scheduled for Feb. 14, 2008. CONTINENTAL AIRLINES: Reports 2007 Pre-Tax Income of $566 Million ----------------------------------------------------------------- Continental Airlines reported on Thursday 2007 pre-tax income of $566.0 million, up 53% percent over 2006 pre-tax income of $369.0 million. Excluding $24 million of previously disclosed pre-tax special items, Continental's pre-tax income for the full year was $542.0 million, a 78% improvement over 2006 pre-tax income of $304 million excluding special items. Continental reported pre-tax income of $71.0 million for the fourth quarter 2007. Excluding previously disclosed pre-tax special items, Continental recorded fourth quarter 2007 pre-tax income of $24.0 million compared to the fourth quarter 2006 pre- tax loss of $4.0 million excluding special items. Continental will record a special non-cash tax charge in the fourth quarter, but has not finalized the amount given the technical nature of the issue. As a result, today the company is presenting its pre-tax results. By mid-February, Continental will finalize the special non-cash tax charge, and will report its net results in the company's Form 10-K. "The outstanding performance of our team has once again set us apart from the competition," said Larry Kellner, Continental's chairman and chief executive officer. "Thanks to the hard work of my co-workers, on Feb. 14, we will distribute $158.0 million in profit sharing, $47.0 million more than we distributed for 2006, and the largest profit sharing distribution in our company's history." Revenue and Capacity Total revenue of $14.2 billion for the year increased $1.1 billion, or 8.4%, over the same period in 2006. Total revenue of $3.5 billion for the fourth quarter increased $366.0 million, or 11.6%, over the same period in 2006. As a result of increases in all mainline geographic regions as well as regional operations, Continental reported record fourth quarter and full year passenger revenue. Consolidated revenue passenger miles for the fourth quarter increased 4.1% year-over-year on a capacity increase of 4.7%, resulting in a fourth quarter consolidated load factor of 79.4%, 0.4 points lower than the fourth quarter record set in 2006. Consolidated yield for the fourth quarter increased 7.1% year- over-year. Consolidated revenue per available seat mile for the fourth quarter increased 6.7% year-over-year due to increased yields. Mainline RPMs in the fourth quarter of 2007 increased 5.4% over the fourth quarter 2006, on a capacity increase of 6.1%. Mainline load factor was 79.7%, down 0.5 points year-over-year. Continental's mainline yield increased 7.6% over the same period in 2006. As a result, fourth quarter 2007 mainline RASM was up 6.9% over the fourth quarter of 2006. "Our passenger revenue performance for the fourth quarter and full year was superb," said Jeff Smisek, Continental's president. "We continued to grow our passenger revenue at a pace significantly greater than our capacity growth, which is a testament to our excellent pricing and revenue management, operational and marketing performance." Financial Results Continental's mainline cost per available seat mile increased 4.1% in the fourth quarter compared to the same period last year. CASM increased 2.6% for full year 2007 as compared to 2006. During the quarter, the price of a barrel of West Texas Intermediate crude oil closed at a peak of $98.18 per barrel on Nov. 23, 2007. Earlier this month, crude oil prices reached a new intra-day record high of $100.09 per barrel. Continental's annualized fuel costs increase by approximately $45.0 million for each $1-per-barrel rise in the price of crude. "Great cost performance backed up by impressive revenue growth enabled us to record a pre-tax profit in the fourth quarter," said Jeff Misner, Continental's executive vice president and chief financial officer. "The entire Continental team once again outperformed the competition." Continental continues to enhance its fuel efficiency. The carrier is about 35.0% more fuel efficient per mainline revenue passenger mile than it was in 1997. With mainline RPMs up 6.5% for the year, mainline fuel consumption increased only 4.8%. During the quarter, Continental installed winglets on seven of the company's 737-500s and one 737-900 aircraft, and now has winglets on 206 of its mainline aircraft. All of the company's 737-700s, 800s and 757-200s have winglets, as do select airplanes from Continental's 737-300, -500 and -900 series fleets. Winglets increase aerodynamic efficiency and decrease drag, reducing fuel consumption and emissions by up to five percent. Continental hedged approximately 32.0% of its fuel requirements for the fourth quarter of 2007. As of Dec. 31, 2007, the company had hedged approximately 20.0% of its projected fuel requirements for the first quarter of 2008 and 5.0% for the second quarter of 2008. Continental ended the fourth quarter with approximately $2.8 billion in unrestricted cash and short-term investments. About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/ -- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 2,900 daily departures throughout the Americas, Europe and Asia, serving 144 domestic and 139 international destinations. More than 500 additional points are served via SkyTeam alliance airlines. With more than 45,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with Continental Express, carries approximately 69 million passengers per year. * * * As reported in the Troubled Company Reporter on Dec. 27, 2007, Fitch Ratings affirmed Continental Airlines 'B-' Issuer Default Rating with a Stable Outlook. CORNERSTONE FIN'L: Case Summary & Ten Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Cornerstone Financial Holdings, LLC dba Zerowhat.com Cornerstone Property Development Holdings, LLC 1105 North Cortez Road Apache Junction, AZ 85219 Bankruptcy Case No.: 08-00469 Chapter 11 Petition Date: January 17, 2008 Court: District of Arizona (Phoenix) Judge: Redfield T. Baum Sr. Debtor's Counsel: Allan D. Newdelman, Esq. Allan D. Newdelman P.C. 80 East Columbus Avenue Phoenix, AZ 85012 Tel: (602) 264-4550 Fax: (602) 277-0144 Total Assets: $39,200 Total Debts: $1,225,500 Debtor's list of its Ten Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ J&P Private Investments Investor $575,000 Mille Phillips 3471 East Mallory Court Mesa, AZ 85206 S&T Investments LLC Investor $200,000 3222 D 7/8 Road Clifton, CO 81520 Brenda & Ralph Marrujo Investor $100,000 10210 East Champagne Drive Sun Lakes, AZ 85248 Martha Haggerty Investor $92,000 Con Molp Investor $75,000 Billy McIntyre Investor $60,000 CMI Plumbing Inc Investor $60,000 Jennifer N. Helle Investor $35,000 Julie Farenbaugh Investor $16,500 Internal Revenue Service Estimated 2007 $12,000 Corporate Loability COUNTRYWIDE FINANCIAL: Inks 4th Amendment to Restated Rights Pact ----------------------------------------------------------------- In connection with Countrywide Financial Corp. entering into a merger agreement with Bank of America Corp., the company entered into a Fourth Amendment to its Amended and Restated Rights Agreement, dated as of Jan. 11, 2008, with American Stock Transfer & Trust Company. The Fourth Amendment modified Countrywide's Amended and Restated Rights Agreement, dated as of Nov. 27, 2001, as amended by the Substitution of Rights Agent and Amendment to Amended and Restated Rights Agreement, dated as of Dec. 8, 2005, the Second Amendment to Amended and Restated Rights Agreement, dated as of June 14, 2006, and the Third Amendment to Amended and Restated Rights Agreement, dated as of Aug. 22, 2007. As reported in the Troubled Company Reporter on Jan. 15, 2008, Countrywide signed a definitive agreement to sell its business to Bank of America in an all-stock transaction worth approximately $4.0 billion. A full-text copy of the merger agreement dated as of Jan. 11, 2008, is available for free at: http://researcharchives.com/t/s?2732 In a recent report by The Wall Street Journal, Countrywide shares dropped nearly 10% Friday on rumors that BofA could walk away from the deal. The Fourth Amendment, among other things, provides that the issuance of rights under the Rights Agreement will not be triggered as a result of the transactions contemplated by the Merger Agreement and that the approval, execution and delivery of the Merger Agreement, the consummation of the Merger, or the consummation of any other transactions contemplated by the Merger Agreement, will not be considered for purposes of determining whether Bank of America or any of its affiliates is an "Acquiring Person" pursuant to the Rights Agreement. A full-text copy of the company's Fourth Amendment to the Amended and Restated Rights Agreement is available for free at: http://researcharchives.com/t/s?2733 About Countrywide Financial Based in Calabasas, California, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services residential and commercial loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. * * * As reported in the Troubled Company Reporter on Jan. 15, 2008, Moody's placed the ratings of Countrywide Financial Corporation and its subsidiaries under review for upgrade. CFC and Countrywide Home Loans senior debt is rated Baa3 and short-term debt is rated Prime-3. Countrywide Bank FSB's bank financial strength rating is C-, deposits are rated Baa1 and short-term debt Prime-2. All long and short-term ratings are placed under review for possible upgrade. CREDIT SUISSE: S&P Cuts Certificate Rating to B on Recent Losses ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on the class II-M-1 mortgage-backed pass-through certificates from Credit Suisse First Boston Mortgage Securities Corp.'s series 2002-19 to 'B' from 'BB'. At the same time, S&P affirmed its 'AAA' ratings on the remaining classes from this series. The downgrade of class II-M-1 reflects recent losses in the past six months that have begun to erode the available credit support for this class. In addition, the level of severely delinquent loans (90-days, foreclosures, and REOs) indicates that further losses are feasible in the future. Severely delinquent loans, as a percentage of the current pool balance, were 20.53%. Cumulative losses, as a percentage of the original pool balance, were 1.57%. The affirmations are based on pool performance that has allowed credit support to remain at levels that are adequate to support the current ratings on the certificates. Subordination, overcollateralization, and excess spread provide credit enhancement for loan group 2 from series 2002-19, while subordination provides sole credit support for loan group I. The collateral for this transaction consists primarily of fixed- and adjustable-rate mortgage loans secured by first liens on one- to four-family residential properties. Rating Lowered Credit Suisse First Boston Mortgage Securities Corp. Mortgage-backed pass-through certificates Rating ------ Class To From ----- -- ---- II-M-1 B BB Ratings Affirmed Credit Suisse First Boston Mortgage Securities Corp. Mortgage-backed pass-through certificates Series Class Rating ------ ----- ------ 2002-19 I-A-4,I-A-18, I-P, I-X,III-P, C-B-1 AAA 2002-19 C-B-2,C-B-3,II-A-5,II-PP AAA DAVID FLANAGAN: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: David Richard Flanagan dba Shamrock Pool Service 13826 North 149th Lane Surprise, AZ 85379 Bankruptcy Case No.: 08-00495 Chapter 11 Petition Date: January 17, 2008 Court: District of Arizona (Phoenix) Judge: Charles G. Case II Debtor's Counsel: Allan D. Newdelman, Esq. Allan D. Newdelman P.C. 80 East Columbus Avenue Phoenix, AZ 85012 Tel: (602) 264-4550 Fax: (602) 277-0144 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. DAVID HURT: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtors: David W. Hurt Janis E. Hurt 15209 North 8th Avenue Phoenix, AZ 85023 Bankruptcy Case No.: 08-00528 Chapter 11 Petition Date: January 18, 2008 Court: District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtors' Counsel: Allan D. Newdelman, Esq. Allan D. Newdelman P.C. 80 East Columbus Avenue Phoenix, AZ 85012 Tel: (602) 264-4550 Fax: (602) 277-0144 Total Assets: $1,788,373 Total Debts: $4,361,813 The Debtor's did not file a list of their 20 largest unsecured creditors. DAVID PIERCE: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: David Pierce Corporation dba USA Baby 6813-A Fairview Road Charlotte, NC 28210 Bankruptcy Case No.: 08-00618 Type of Business: The Debtor operates a retailer store for infant and juvenile furniture and accessories. Chapter 11 Petition Date: January 18, 2008 Court: Middle District of Florida (Tampa) Judge: Paul M. Glenn Debtor's Counsel: Richard J. McIntyre, Esq. McIntyre, Deese, Baruch, Panzarella etal 6943 East Fowler Avenue Temple Terrace, FL 33617 Tel: (813) 899-6059 Fax: 813-899-6069 Estimated Assets: $1 Million to $10 Million Estimated Debts: $500,000 to $1 Million Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ William Spivock Operating Cash $387,303 6813-A Fairview Road Charlotte, NC 28210 USA Baby - IL Trade debt $20,835 793 Springer Drive Lombard, IL 60148 Munire Furniture Co. Inc. Trade debt $16,479 55 Webro Road Clifton, NJ 07012 Simplicity for Children Trade debt $15,836 Kolcraft Enterprises, Inc. Trade debt $7,738 Berg East Imports Trade debt $4,984 WFTS ABC Trade debt $4,820 Sandberg, Pheonix & VonGodard Legal Advice $4,799 C&T International Trade debt $4,695 Brent K. August & Company Tax preparation $3,636 Graco Childrens Products Trade debt $3,499 A.P. Industries Trade debt $3,305 Paymenttech Merchant Service Trade debt $3,168 Direct Shippers Association Inc. Trade debt $2,824 Stanley Furniture Co., Inc. Trade debt $2,796 Glenna Jean MFG Co. Trade debt $2,760 Law Office of Steven W. Moore Legal representation $2,660 on landlord law suit Kidsline, LLC Trade debt $2,304 Morigeau-Lepine Furniture Trade debt $2,270 WTVT Television Trade debt $1,887 DELPHINUS CDO: Moody's Junks Rating on $48 Mil. Notes from Ba2 -------------------------------------------------------------- Moody's Investors Service downgraded these ratings of eleven classes of notes issued by Delphinus CDO 2007-1, Ltd., and left on review for possible further downgrade ratings of seven of these classes of notes: Class Description: 1) $73,500,000 Class A-1A Senior Floating Rate Notes Due October 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba1, on review for possible downgrade 2) $86,500,000 Class A-1B Senior Floating Rate Notes Due October 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba1, on review for possible downgrade 3) $160,000,000 Class A-1C Senior Floating Rate Notes Due October 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba2, on review for possible downgrade 4) $144,500,000 Class A-2 Senior Floating Rate Notes Due October 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: B1, on review for possible downgrade 5) $138,500,000 Class A-3 Senior Floating Rate Notes Due October 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: B3, on review for possible downgrade 6) $131,000,000 Class B Senior Floating Rate Notes Due October 2047 -- Prior Rating: A3, on review for possible downgrade -- Current Rating: Caa1, on review for possible downgrade 7) $77,500,000 Class C Mezzanine Floating Rate Deferrable Notes Due October 2047 -- Prior Rating: Baa3, on review for possible downgrade -- Current Rating: Ca 8) $48,000,000 Class D-1 Mezzanine Floating Rate Deferrable Notes Due October 2047 -- Prior Rating: Ba2, on review for possible downgrade -- Current Rating: Ca 9) $30,500,000 Class D-2 Mezzanine Floating Rate Deferrable Notes Due October 2047 -- Prior Rating: B1, on review for possible downgrade -- Current Rating: Ca 10) $15,000,000 Class D-3 Mezzanine Floating Rate Deferrable Notes Due October 2047 -- Prior Rating: Caa3, on review for possible downgrade -- Current Rating: Ca 11) $15,000,000 Class E Mezzanine Floating Rate Deferrable Notes Due October 2047 -- Prior Rating: Caa3, on review for possible downgrade -- Current Rating: Ca In addition, Moody's has placed the rating of one class of notes issued by Delphinus CDO 2007-1, Ltd. on review for possible further downgrade: Class Description: $27,000,000 Class S Senior Floating Rate Deferrable Notes Due October 2012 -- Prior Rating: Aaa -- Current Rating: Aaa, on review for possible downgrade The rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence, as reported by the Trustee, of an event of default caused by a failure of the Par Value Coverage Ratio on Jan. 2, 2008 to be greater than or equal to the required amount pursuant Section 5.1(i) of the Indenture dated July 19, 2007. Delphinus CDO 2007-1, 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 Par Value Coverage 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, the controlling class may be entitled to direct the Trustee to take particular actions with respect to the Collateral. The rating downgrade taken reflects the increased expected loss associated with the transaction. Losses are attributed to diminished credit quality on the underlying portfolio. The severity of losses of may depend on the timing and choice of remedy to be pursued by the controlling class. Because of this uncertainty, the ratings of seven classes of notes issued by Delphinus CDO 2007-1 Ltd. are on review for possible further action. DOWNTOWN NORTH: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Downtown North Development Group LLC aka G & C Holdings LLC 1101 Lucas Avenue, Suite 5W St. Louis, MO 63101 Bankruptcy Case No.: 08-40390 Chapter 11 Petition Date: January 18, 2008 Court: Eastern District of Missouri (St. Louis) Judge: Barry S. Schermer Debtors' Counsel: Daniel D. Doyle, Esq. Spencer, Fane et al. 1 North Brentwood Boulevard, #1000 St. Louis, MO 63105-3925 Tel: (314) 863-7733 Fax: (314) 862-4656 http://www.spencerfane.com/ Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Consolidated Debtors' List of 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Jia-Jye Gladney aka Susan Wu $30,000 329 N. Central Avenue Saint Louis, MO 63105 Klitzing Welsch Associates Inc. $21,000 3109 S. Grand Boulevard Saint Louis, MO 63166 Stelmacki, Cochran and $5,700 Sauerburger P.C. 12655 Olive Boulevard, Suite 200 Saint Louis, MO 63141 Service Master Inc. $4,574 Tech Electronics $3,621 AmerenUE $3,011 Metropolitan St. Louis Sewer $2,100 ThyssenKrupp Elevator $2,000 Johnson Controls $2,000 Dativoci $1,865 Gateway Elevator $1,800 St. Louis City Water $1,634 Moore Computing LLC $1,000 AT&T $900 Cordia Plumbing $855 Hackett Security $800 JS Express $496 Gateway Fire Protection $325 Komro Supply Co. $23 Helfry, Neiers & Jones PC unknown DURA AUTOMOTIVE: Wants to Assume GM Component Supply Agreement -------------------------------------------------------------- DURA Automotive Systems, Inc., and its debtor-affiliates seek the authority of the U.S. Bankruptcy Court for the District of Delaware to assume a component supply agreement between the Debtors and General Motors Corp. The Debtors also seek the Court's authority to file the CSA and any related materials under seal. Before the Petition Date, the Debtors entered into purchase agreements with GM. According to DURA's Chapter 11 Petition, sales to GM comprises 10% of the Debtors' total annual revenues. In the summer of 2007, the Debtors and GM entered into a component supply agreement, which modified the Prepetition GM Purchase Contracts. The CSA modifies, among other things, the pricing agreement between the Debtors and GM. The Debtors and GM agree that, as a condition to assumption of the CSA, the Debtors will file any assumption motion, the CSA, and any related materials, under seal, Albert Togut, Esq., at Togut, Segal & Segal, LLP, in New York, relates. Mr. Togut says the CSA contains confidential and commercially sensitive information that if publicly disclosed may harm the Debtors' business relationship with GM. Mr. Togut tells the Court that the Debtors have provided copies of the Assumption Motion to GM, the Official Committee of Unsecured Creditors and the office of the U.S. Trustee for the District of Delaware. He adds that interested parties may obtain additional information about the CSA and the Assumption Motion from the Debtors. Additional information will be disclosed by the Debtors, with consent from GM, to any requesting party subject to a confidentiality agreement relating to that additional information. Rochester Hills, Mich.-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The company has three locations in Asia -- China, Japan and Korea. It has locations in Europe and Latin-America, particularly in Mexico, Germany and the United Kingdom. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co-counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had $1,993,178,000 in total assets and $1,730,758,000 in total liabilities. (Dura Automotive Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). ECHOSTAR COMMS: S&P Maintains 'BB-' Corporate Credit Rating ----------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating, and other ratings on Englewood, Colorado-based EchoStar Communications Corp. and removed them from CreditWatch where they were placed on Sept. 26, 2007, with developing implications. The outlook is stable. EchoStar was placed on CreditWatch following its decision to explore separating into two distinct, publicly traded companies: EchoStar Communications Corp., the core consumer pay-TV business, and unrated EchoStar Holdings Corp., the wholesale set-top box business. The spin-off occurred on Jan. 2, 2008. EchoStar plans to change its name to DISH Network Corp. on about Jan. 20, 2008. "When we initiated the CreditWatch, we stated that because the rating incorporated some uncertainty regarding strategic and financial policies, we could raise the ratings if the transaction clarified whether EchoStar would pursue a financial policy consistent with a higher rating," said Standard & Poor's credit analyst Naveen Sarma. "Conversely, we said we could lower the ratings if EchoStar became aggressively levered or was likely to pursue heavily shareholder-oriented policies." The ratings affirmation is driven by two factors: -- the company's continued lack of clarity regarding its strategic and financial policies, and -- the minimal increase in leverage at EchoStar following the spin-off. S&P did not raise the rating because S&P does not believe EchoStar's management has provided sufficient clarity to remove uncertainty about its policies for the company. Conversely, S&P did not lower the rating because leverage at EchoStar only increased minimally. The spin-off of the wholesale box business, which included $1.5 billion in cash and marketable securities, but only $388 million in unrated debt, reduces EchoStar's liquidity, but minimally increases its leverage to 2.25x debt-to annualized year-to-date EBITDA from 2.13x, as of Sept. 30, 2007. The ratings on the satellite TV provider reflect intense competition from cable TV system operators and its satellite rival, the DIRECTV Group Inc. While EchoStar outpaced cable in subscriber growth in recent years, some concern remains about the company's longer-term competitive position due to its inability to provide high-speed data, voice, and advanced two-way video services that are available from cable companies. Phone companies would also offer these services on a wider scale over the next few years. In addition, a degree of financial and strategic policy uncertainty weighs on the ratings. Tempering factors include healthy customer, revenue, and EBITDA growth; good liquidity from growing discretionary cash flow and a sizable cash balance; and generally admirable customer satisfaction metrics. ECOMARES INC: Chapter 15 Petition Summary ----------------------------------------- Petitioner: Dieter Kloth Ecomares, Inc. Attention: Jeffrey L. Hartman, Esq. 510 West Plumb Lane, Suite B Reno, NV 89509 Tel: (775) 324-2800 Fax: (775) 324-1818 Debtor: Ecomares, Inc. Attention: Jeffrey L. Hartman, Esq. 510 West Plumb Lane, Suite B Reno, NV 89509 Tel: (775) 324-2800 Fax: (775) 324-1818 Case No.: 08-50074 Type of Business: The Debtor is a holding company that was founded by a group of German scientists and developers and incorporated in Nevada in 2003. Its principal place of business is, however, Kiel, Germany. Its subsidiaries are engaged in the design, building and operation of fish hatcheries worldwide. On December 1, 2007, an insolvency proceeding was commenced against the Debtor under the German insolvency act. In Nevada, the Debtor is a named party in two civil actions that are pending in separate courts, namely against Colville Services, Ltd. and against Angelina Ovcharik. See http://www.ecomares.de/ Chapter 15 Petition Date: January 18, 2008 Court: District of Nevada (Reno) Judge: Gregg W. Zive Petitioner's Counsel: Jeffrey L. Hartman, Esq. 510 West Plumb Lane, Suite B Reno, NV 89509 Tel: (775) 324-2800 Fax: (775) 324-1818 Estimated Assets: Unknown Estimated Debts: Unknown ELWOOD ENERGY: S&P Lifts Rating on $402 Mil. 2026 Bonds to 'BB' --------------------------------------------------------------- Standard & Poor's Ratings Services raised its rating on Elwood Energy LLC's $402 million ($296.8 million outstanding) 8.159% senior secured bonds due 2026 to 'BB' from 'BB-'. S&P also assigned a '2' recovery rating to the bonds, indicating its expectation of substantial recovery (70% to 90%) recovery in a payment default scenario. Recovery prospects for project finance entities, such as Elwood Energy, are incorporated into the issue rating and the entity is not assigned a corporate credit rating. The outlook is stable. The upgrade reflects the greater likelihood that Elwood would be able to enter into replacement contracts or earn capacity payments at levels sufficient to cover debt service when its power sales agreement with Exelon Generation Co. LLC (BBB+/Stable/A-2) expires in 2012. "This is because of the favorable capacity market development in the PJM Interconnection and the structural provisions in the bond financing documents that trap cash and restrict distribution to sponsors based on the level of contracted capacity and robustness of debt service coverage ratios," said Standard & Poor's credit analyst Chinelo Chidozie. Elwood is a 1,409 MW merchant peaking power plant near Chicago, Illinois that sells into the PJM's Northern Illinois control area and is fully contracted through 2012 and partially through 2017. Subsidiaries of Dominion Resources Inc. (A-/Stable/A-2) own 50% of Elwood, J-Power North American Holdings Co.Ltd. owns 49.9%, and Peoples Energy Corp. (A-/Stable/--) owns the remaining 0.1%. Standard & Poor's expects near-term stability in ratings, based on cash flows from investment-grade-rated off-takers that are not sensitive to dispatch. S&P could lower Elwood Energy's rating if S&P cuts either off- taker's rating to below that of Elwood. An upgrade will depend on continued market improvement in the Northern Illinois hub of the PJM. EMI GROUP: Terra Firma Outlines Restructuring Plan -------------------------------------------------- Terra Firma Plc, EMI Group Plc's new owner, confirmed plans to restructure the music company, particularly its Recorded Music Division. Guy Hands, EMI Group's chairman, unveiled a fundamental reshaping of the business to reflect the rapidly-changing nature of the music industry. The changes include: * positioning EMI's labels to ensure they will be completely focussed on A&R and maximizing the potential of all their artists; * developing a new partnership with artists, based on transparency and trust, and helping all artists monetise the value of their work by opening new income streams such as enhanced digital services and corporate sponsorship arrangements; * bringing together all the group's key support activities including sales, marketing manufacturing and distribution into a single division with a unified global leadership; and * the elimination of significant duplications within the group to simplify processes and reduce waste. The changes, which will be implemented over the next six months, will enable the group to invest more in its A&R operations both to identify and sign promising new artists and to maximize the potential of its existing roster. The restructuring is being carried out following an intense three- month consultation review of the business by Terra Firma since it acquired the business last year and many of the measures being implemented have come at the suggestion of staff, artists or their managers. The restructuring will also enable the group to capture significant efficiencies and cost reductions which are expect to reduce costs by up to �200 million per year. The restructuring is also expected to lead to a worldwide headcount reduction within the group of between 1,500 and 2,000. "We have spent a long time looking intensely at EMI and the problems faced by its Recorded Music division which, like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment," Mr. Hands commented. "We believe we have devised a new revolutionary structure for the group that will improve every area of the business," Mr. Hands continued. "In short it will make EMI's music more valuable for the company and its artists alike. The changes we are announcing today will ensure that this iconic company will be creating wonderful music in a way that is profitable and sustainable." About Terra Firma Terra Firma is a leading European private equity firm, created in 2002 as the independent successor to the Principal Finance Group, a division of Nomura that was created in 1994. Terra Firma focuses on buyouts of large, asset-rich and complex businesses in need of operational and/or strategic change. About EMI Headquartered in London, United Kingdom, EMI Group PLC -- http://www.emigroup.com/-- is the world's largest independent music company, operating directly in 50 countries and with licensees in a further 20. The group has operations in Brazil, China, and Hungary. The group employs over 6,600 people. Revenues in 2005 were near EUR2 billion and operating profit generated was over EUR225 million. EMI Group's consolidated balance sheet for the fiscal year ended March 31, 2007, showed GBP1.498 billion in total assets, GBP2.649 billion in total liabilities and GBP1.151 billion in shareholders' deficit. The company issued two profit warnings since January 2007. ENECO INC: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: ENECO, Inc. 391-B Chipeta Way Salt Lake City, UT 84108 Bankruptcy Case No.: 08-20319 Type of Business: The Debtor developed the Thermal Chip, a semiconductor that it claimed to converted heat into electricity with a promise of substantial energy savings and a reduction in harmful emissions. See http://www.eneco.com/ Chapter 11 Petition Date: January 18, 2008 Court: District of Utah (Salt Lake City) Judge: Glen E. Clark Debtor's Counsel: Scott A. Cummings, Esq. Steven T. Waterman, Esq. Ray Quinney & Nebeker 36 South State Street, Suite 1400 P.O. Box 45385 Salt Lake City, UT 84145-0385 Tel: (801) 323-3363, (801) 532-1500 Fax: (801) 532-7543 Estimated Assets: $10 Million to $50 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Catalyst Investment Group investment fee $500,000 10-13 Jovat Lane London, England EC3R 8DN Ciralus Fine Arts 2003 note $252,227 7, rue Versonnex CH 1207 Geneva Switzerland Maximillian & Co. consulting fees $221,115 Tanyard Manor Sharpthorne, Sussex RH19 4HY UK Hagelstein, Peter consulting fee $90,000 Epitaxial Laboratory, Inc. M.B.E. Epitax $90,000 Equipment Tuckerman & Associates, Inc. consulting fee $78,980 Shannon Industries 2003 note $66,320 De Joya Griffith & Co., L.L.C. audit fees $35,000 Mishcon de Reya legal fees $34,706 Lewinsohn, Max note $30,000 Capital Premium Financing, D.&O. Insurance $29,000 Inc. Sevastyanenko, Victor back wages $21,833 Internal Revenue Service taxes $19,000 Workman, Nydeggar & Seeley legal fees $14,276 Trythall, Elizabeth back wages $12,333 Maurice Brau Colorado Research trade vendor $10,000 Kucherov, Yan back wages $9,000 Uze, David interview expense $9,000 Beehive Insurance Agency D.&O. insurance $9,000 broker University of Utah Sponsored services contract $7,500 Projects ERIE BAY: Case Summary & 17 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Erie Bay Harbor Marina, Inc. 5522 West Jefferson Avenue Trenton, MI 48183 Bankruptcy Case No.: 08-41123 Chapter 11 Petition Date: January 17, 2008 Court: Eastern District of Michigan (Detroit) Judge: Steven W. Rhodes Debtor's Counsel: Martin L. Fried, Esq. Goldstein, Bershad, Fried & Lieberman 4000 Town Center Suite 1200 Southfield, MI 48075 Tel: (248) 355-5300 Estimated Assets: $0 to $50,000 Estimated Debts: $1 Million to $10 Million Debtor's list of its 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Monroe Bank & Trust $784,749 102 East Front Street Monroe, MI 48161 Mercury Marine $256,013 75 Remittance Drive Suite 1957 Chicago, IL 60675 Textron Financial $194,624 21720 Network Place Chicago, IL 60673 GE Commercial Distribution Acct. No 165730 $176,874 $174,837 Brunswick Acceptance Co. $89,212 Martha Lezotte $30,000 Shrink Wrap Internation $15,000 Wally Little $12,000 American Canvas $10,000 Anchor Pointe $8,000 BRP US Inc. $7,831 Lund Boats $7,546 Land N Sea $7,279 Lost Peninsula $7,000 Hanover Insurance Acct. No. WHH8692738 $6,708 Scuttlebutt $4,372 Meyers & Associate $4,000 EUROFRESH INC: S&P Cuts Ratings to 'D' on Missed Interest Payment ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on EuroFresh Inc. to 'D' from 'CCC', and the rating on its 11.5% senior notes to 'D' from 'CCC-'. At the same time, Standard & Poor's lowered its rating on the company's bank loan facility to 'CC' from 'B-', while the '1' recovery rating on this facility remains unchanged. The 'CC' rating on the company's $44.2 million step-up senior subordinated discount notes is affirmed. "The downgrades are based on the company's failure to pay its Jan. 15, 2008, interest payment on its 11.5% senior notes due 2013," said Standard & Poor's credit analyst Bea Chiem. The company has a 30-day grace period within which to make the interest payment in order to avoid a default under the notes. At Dec. 31, 2007, the company was not in compliance with its leverage covenant on its senior secured bank debt, and the company is in discussions with its bank group to secure a forbearance agreement. Willcox, Arizona-based EuroFresh is a year-round producer and marketer of fresh greenhouse-grown tomatoes in the U.S. Operating performance continues to deteriorate because of rising operating costs and crop-yield issues. Standard & Poor's will continue to monitor the situation and make updates as additional information becomes available. FEDDERS CORP: Completes $7.5 Million Sale of Affiliate's Assets --------------------------------------------------------------- Fedders Corporation has completed the sale of its Fedders Islandaire Inc. subsidiary's assets to Robert E. Hansen, Jr., president of Islandaire. As reported in the Troubled Company Reporter on Jan. 16, 2008, the Honorable Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware approved Fedders Corp. and its debtor-affiliates' proposed bidding procedure for the sale of substantially all of Fedders Islandaire Inc.'s assets for $7.5 million. About Fedders Corporation Based in Liberty Corner, New Jersey, Fedders Corporation -- http://www.fedders.com/-- manufactures and markets air treatment products, including air conditioners, air cleaners, dehumidifiers, and humidifiers. The company has production facilities in the United States in Illinois, North Carolina, New Mexico, and Texas and international production facilities in the Philippines, China and India. The company filed for Chapter 11 protection on Aug. 22, 2007, (Bankr. D. Del. Case No. 07-11182). Its debtor-affiliates filed for separate Chapter 11 cases. Norman L. Pernick, Esq., Irving E. Walker, Esq., and Adam H. Isenberg, Esq., of Saul, Ewing, Remick & Saul LLP represents the Debtors in their restructuring efforts. The Debtors have selected Logan & Company Inc. as claims and noticing agent. The Official Committee of Unsecured Creditors is represented by Brown Rudnick Berlack Israels LLP. When the Debtors filed for protection from its creditors, it listed total assets of $186,300,000 and total debts of $322,000,000. As reported in the Troubled Company Reporter on Jan. 21, 2008, the Court extended the Debtors' exclusive period to file a Chapter 11 plan until Feb. 29, 2008. FEDDERS CORP: Sells Eubank Coil to National Oil for $2.3 Million ---------------------------------------------------------------- The United States Bankruptcy Court for the District of Delaware approved the sale of substantially all of Eubank Coil Company's assets to National Oil Company, United Refrigeration Inc., and Tersco Property Management Limited for $2,340,000. Eubank Coil is a subsidiary of Fedders Corporation. Eubank entered into an asset purchase agreement dated Dec. 14, 2007, with National Oil Company for the sale of its assets. Under the sale agreement, National Oil will assume certain liabilities and certain executory contracts and unexpired leases. About Fedders Corporation Based in Liberty Corner, New Jersey, Fedders Corporation -- http://www.fedders.com/-- manufactures and markets air treatment products, including air conditioners, air cleaners, dehumidifiers, and humidifiers. The company has production facilities in the United States in Illinois, North Carolina, New Mexico, and Texas and international production facilities in the Philippines, China and India. The company filed for Chapter 11 protection on Aug. 22, 2007, (Bankr. D. Del. Case No. 07-11182). Its debtor-affiliates filed for separate Chapter 11 cases. Norman L. Pernick, Esq., Irving E. Walker, Esq., and Adam H. Isenberg, Esq., of Saul, Ewing, Remick & Saul LLP represents the Debtors in their restructuring efforts. The Debtors have selected Logan & Company Inc. as claims and noticing agent. The Official Committee of Unsecured Creditors is represented by Brown Rudnick Berlack Israels LLP. When the Debtors filed for protection from its creditors, it listed total assets of $186,300,000 and total debts of $322,000,000. As reported in the Troubled Company Reporter on Jan. 21, 2008, the Court extended the Debtors' exclusive period to file a Chapter 11 plan until Feb. 29, 2008. FEDDERS CORP: Unsecured Creditors Want to Sue Insiders & Lenders ---------------------------------------------------------------- The Official Committee of Unsecured Creditors in Fedders Corp. and its debtor-affiliates' Chapter 11 cases asks authority from the U.S. Bankruptcy Court for the District of Delaware to assert and prosecute the Debtors' claims against certain insiders, lenders, and directors, on behalf of the Debtors. Committee conflicts counsel Sharon L. Levine, Esq., at Lowenstein Sandler P.C., relates that, in accordance with its fiduciary duties to unsecured creditors in the Debtors' cases, the Committee began an extensive investigation of claims that the Debtors' estates hold against third parties. These parties include: A) Lenders -- Goldman Sachs Credit Partners L.P. -- Bank of America, N.A. -- General Electric Capital Corporation -- Highland Capital Partners, LLC B) Insiders -- Salvatore Giordano, Jr. -- Michael Giordano -- Joseph Giordano, S.A. -- Robert L. Laurent -- Kent E. Hansen -- Peter Gasiewicz -- Warren Emley C) Outside Directors -- William J. Brennan -- David C. Chang -- Michael L. Ducker -- Howard S. Modlin -- Herbert A. Morey -- Anthony E. Puleo -- Jitendra V. Singh The Committee also continues to investigate potential claims against Wachovia Bank, N.A., certain financial advisors, accountants, auditors, and other officers of the Debtors. Ms. Levine says that the Committee had compelled the Debtors to use their authority to either commence a lawsuit and prosecute the claims, or to consent to the Committee's standing. Since the Committee did not receive any response from the Debtors, the Committee accordingly asks the Court for proper standing to prosecute such claims. Committee's Investigation of Claims According to Ms. Levine, the Committee's investigation discovered apparent misconduct being done by the lenders, the insiders, and outside directors, which collectively caused as much as $150 million or more in damages to the Debtors and, ultimately, the unsecured creditors. The claims against the defendants are premised upon causes of action, which include the following, among others: 1) breach of fiduciary duty; 2) aiding and abetting breach of fiduciary duty; 3) fraudulent conveyance; 4) aiding and abetting fraudelent conveyance; 5) waste of corporate assets / ultra vires acts; 6) tortious interference with contractual relations; 7) tortious interference with prospective business advantage; 8) improvident lending; 9) unjust enrichment; and 10) breach of the covenants of good faith and fair dealing. Ms. Levine relates that, first, the insiders betrayed the Debtors by using the Debtors as their "personal piggy bank" and extracted, among other things, lavish compensation, interest-free personal loans and rich severance packages, even when they knew the Debtors were financially disintegrating. In March 2007, the insiders closed on loans they knew the Debtors could never repay. Ms. Levine tells the Court that the loans were already in default when the insiders signed the corresponding loan agreements. The insiders breached their fiduciary duties and hid their loan agreements from public filings, Ms. Levine contends. Second, the lenders are jointly and severally liable by aiding and abetting the insiders' misconduct. Even though the loans were in default, the lenders gave the insiders substantial assistance and encouragement, so they could pocket large fees for themselves, argues Ms. Levine. Third, Ms. Levine complained that the outside Directors didn't safeguard the interests of the Debtors and apparently allowed insiders' and lenders' misconduct to happen. The Committee concludes that a recovery coming from a successful litigation against the conspirators will be beneficial to the Debtors' estates. About Fedders Corporation Based in Liberty Corner, New Jersey, Fedders Corporation -- http://www.fedders.com/-- manufactures and markets air treatment products, including air conditioners, air cleaners, dehumidifiers, and humidifiers. The company has production facilities in the United States in Illinois, North Carolina, New Mexico, and Texas and international production facilities in the Philippines, China and India. The company filed for Chapter 11 protection on Aug. 22, 2007, (Bankr. D. Del. Case No. 07-11182). Its debtor-affiliates filed for separate Chapter 11 cases. Norman L. Pernick, Esq., Irving E. Walker, Esq., and Adam H. Isenberg, Esq., of Saul, Ewing, Remick & Saul LLP represents the Debtors in their restructuring efforts. The Debtors have selected Logan & Company Inc. as claims and noticing agent. The Official Committee of Unsecured Creditors is represented by Brown Rudnick Berlack Israels LLP. When the Debtors filed for protection from its creditors, it listed total assets of $186,300,000 and total debts of $322,000,000. As reported in the Troubled Company Reporter on Jan. 21, 2008, the Court extended the Debtors' exclusive period to file a Chapter 11 plan until Feb. 29, 2008. FLEXTRONICS INTERNATIONAL: Dr. Willy Shih Joins Board of Directors ------------------------------------------------------------------ Flextronics International has announced that Willy Shih, Ph.D., Harvard Business School senior lecturer, has been appointed to the company's Board of Directors effective immediately. Dr. Shih is currently a senior lecturer for the Harvard Business School, a role he has held since January 2007. Dr. Shih's broad industry career experience includes significant accomplishments for globally recognized organizations such as Kodak, IBM, Silicon Graphics and Thomson. While at Kodak, Dr. Shih led the organization to leadership market positions in the United States in consumer digital cameras, photo printing consumables and online photofinishing services. He also managed key intellectual property projects at Thomson and at Kodak. Dr. Shih holds a Ph.D. in Chemistry from the University of California, Berkeley and S.B. degrees in Chemistry and Life Sciences from the Massachusetts Institute of Technology. "Willy is a strong leader who brings complementary and well- rounded experience to the Flextronics Board along with a shared, practical approach to the leadership of complex global organizations. We feel we have added significant strength to our organization," said Flextronics chief executive officer, Mike McNamara. "I would like to welcome Willy as the newest member of the Flextronics Board." As previously announced and in connection with the appointment of the new director, Michael Marks has simultaneously retired as a director of Flextronics International. Ray Bingham has assumed the role of Flextronics' Chairperson of the Board. Mr. Bingham has served as a member of Flextronics Board since October 2005. He has also served in a number of capacities with Cadence Design Systems, Inc., a supplier of electronic design automation software and services. Mr. Bingham served Cadence as its Executive Chairperson from May 2004 to July 2005, Director from November 1997 to April 2004, President and Chief Executive Officer from April 1999 to May 2004, and Executive Vice President and Chief Financial Officer from April 1993 to April 1999. Mr. McNamara continued, "On behalf of the Board, I would like to thank Michael for his many contributions to Flextronics over the years. His guidance and leadership have been significant to our organization and we wish Michael all the best in his future endeavors." As reported in the Troubled Company Reporter - Latin America on Jan. 4, 2008, Flextronics International Ltd. intended to close its Wilmington manufacturing plant next month, eliminating more than 100 jobs, Globe Newspaper Company reports citing a letter the company sent to state officials. The report recounted that Flextronics bought Solectron in October for $3.6 billion and decided to close the Wilmington plant as part of the process of combining the companies. Director of Compliance for Flextronics Grainne Blanchette was quoted by the news agency as saying, "This was a difficult decision to make and was reached only after analyzing the options available." The decision was needed to "achieve the necessary reductions in costs" associated with the merger, he added. After completing the Solectron acquisition, the report related, the company planned to cut 7,000 jobs worldwide, close several facilities, and record restructuring charges of $430 million to $500 million over the next year. The report said that according to the company's letter, dated Nov. 5, the job cuts will occur between Jan. 17 and 31. Federal law generally requires large employers to notify employees and the government of a plant closing or major layoff at least 60 days in advance, the report adds. About Flextronics International Headquartered in Singapore, Flextronics International Ltd. (NasdaqGS: FLEX) -- http://www.flextronics.com/-- is an Electronics Manufacturing Services provider focused on delivering design, engineering and manufacturing services to automotive, computing, consumer digital, industrial, infrastructure, medical and mobile OEMs. Flextronics helps customers design, build, ship, and service electronics products through a network of facilities in over 30 countries on four continents including Brazil, Mexico, Hungary, Sweden, United Kingdom, among others. * * * As reported in the Troubled Company Reporter on Oct. 4, 2007, Fitch Ratings has completed its review of Flextronics International Ltd. following the company's acquisition of Solectron Corp. and resolved Flextronics' Rating Watch Negative status by affirming these ratings: Issuer Default Rating at 'BB+'; and Senior unsecured credit facility at 'BB+'. Fitch also rated Flextronics' new senior unsecured Term B loan at 'BB+'. Additionally, Fitch has downgraded the rating on Flextronics' senior subordinated notes from 'BB' to 'BB-'. The Rating Outlook is Negative. At the same time, Moody's Investors Service confirmed the ratings of Flextronics International Ltd. with a negative outlook and assigned a Ba1 rating to the company's new $1.75 billion delayed draw unsecured term loan in response to the closing of the Solectron acquisition. The initial draw on the term loan ($1.1 billion) will finance the cash portion of the merger consideration. GCI INC: Earns $2.2 Million in Third Quarter Ended Sept. 30 ----------------------------------------------------------- GCI Inc. reported net income of $2.2 million for the third quarter ended Sept. 30, 2007. The company's third quarter net income compares to income of $6.5 million in the same period of 2006. GCI's third quarter 2007 revenues totaled $133.9 million, an increase of 7.0% over revenues of $125.1 million in the third quarter of 2006. The company said that revenue increases from video, data and wireless were partially offset, as expected, from decreasing voice revenues. Voice revenues decreased across the company's business segments as a result of lower rates and fewer long distance minutes carried on its network. Third quarter 2007 earnings before interest, taxes, depreciation, amortization and share based compensation expense totaled $38.7 million. EBITDAS decreased $2.6 million or 6.4% from the third quarter of 2006. The decrease in EBITDAS was primarily attributable to a decrease in EBITDAS from the network access and commercial segments, offset in part, by strong growth in the consumer segment. Sequentially, revenues for the company increased $4.3 million, an increase of 3.3%, over second quarter 2007 revenues of $129.6 million. Third quarter EBITDAS of $38.7 million decreased 6.4% from $41.3 million in the second quarter of 2007. Sequential increases in revenue occurred in all business segments. The increase in EBITDAS from the consumer segment was offset by decreases from the network access, commercial and managed broadband segments. "Our consumer business had a spectacular quarter," said GCI president, Ron Duncan. "Customer metrics were up all across the board including solid increases in wire line, wireless, high speed data and video customers. We significantly outpaced our largest competitor in each of these categories adding more than three times as many high speed customers and almost twice as many wireless customers." "We are also doing very well with the efforts to grow our local service footprint and convert all of our local services to our own facilities. We had an increase of 5,300 access lines on our own facilities in the third quarter and ended the quarter with more than half of our total access lines exclusively on our own facilities. Our plan for complete facilities independence is making excellent progress." "Unfortunately our strong success in the marketplace was offset by continued challenges in our carrier business which is down significantly from the prior year. The reductions in carrier traffic and some sluggishness in our commercial sector overwhelmed the success of our consumer business to produce very disappointing financial results for the quarter." Total selling, general and administrative expenses increased 12.8% to $49.0 million as compared to $43.4 million in the third quarter of 2006 and increased 3.1% from the second quarter of 2007. The increase in SG&A from the prior year was primarily due to the consolidation of Alaska DigiTel and increases in labor and benefits costs. Excluding Alaska DigiTel and non-cash share based compensation costs, SG&A increased 1.3% as compared to the prior year and increased 1.0% from the second quarter of 2007. During the third quarter of 2007 GCI's capital expenditures totaled $37.5 million as compared to $43.6 million in the second quarter of 2007. GCI's capital expenditures include those of Alaska DigiTel. Balance Sheet At Sept. 30, 2007, the company's consolidated balance sheet showed $967.7 million in total assets, $708.2 million in total liabilities, $6.5 million in minority interest, and $253.0 million in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2737 About GCI Inc. Headquartered in Anchorage, Alaska, GCI Inc. (NASDAQ: GNCMA) -- http://www.gci.com/-- is an integrated telecommunications provider. A pioneer in bundled services, GCI provides local, wireless, and long distance telephone, cable television, Internet and data communication services. * * * As reported in the Troubled Company Reporter on Jan. 21, 2008, Moody's placed the Ba3 Corporate Family rating and B1 Senior Unsecured rating of GCI Inc. under review for possible downgrade. The rating action was prompted by the company's recent announcement that it plans to construct a wireless network throughout the state of Alaska, funded with debt. Moody's noted that the increased capital expenditures associated with GCI's planned wireless network build are occurring at a time when debt levels are already expected to rise to fund pending acquisitions and other capital spending initiatives. GS MORTGAGE: Fitch Junks Ratings on Four Certificate Classes ------------------------------------------------------------ Fitch Ratings has taken various rating actions on these GS Mortgage Securities GSR mortgage pass-through certificates: GSR 2006-2F -- Class A affirmed at 'AAA'; -- Class M1 affirmed at 'AA+'; -- Class B-1 affirmed at 'AA'; -- Class B-2 downgraded to 'A-' from 'A'; -- Class B-3 downgraded to 'BB+' from 'BBB'; -- Class B-4 downgraded to 'CC/DR3' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B', and removed from Rating Watch Negative. GSR 2006-3F -- Class A affirmed at 'AAA'; -- Class M1 affirmed at 'AA+'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 downgraded to 'BB+' from 'BBB'; -- Class B-4 downgraded to 'B' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B', and removed from ating Watch Negative. GSR 2006-AR2 Group1 -- Class A affirmed at 'AAA'; -- Class 1B1 affirmed at 'AA+'; -- Class 1B2 affirmed at 'A+'; -- Class 1B3 affirmed at 'BBB+'; -- Class 1B4 affirmed at 'BB+'; -- Class 1B5 affirmed at 'B+'. GSR 2006-AR2 Group2 -- Class A affirmed at 'AAA'; -- Class 2B1 affirmed at 'AA'; -- Class 2B2 affirmed at 'A'; -- Class 2B3 affirmed at 'BBB'; -- Class 2B4 downgraded to 'B' from 'BB'; -- Class 2B5 downgraded to 'C/DR4' from 'B', and removed from Rating Watch Negative. The affirmations affect approximately $1.89 billion in outstanding certificates and reflect adequate relationships of credit enhancement to future loss expectations. The downgrades, affecting approximately $22.1 million of the outstanding certificates, reflect deterioration in the relationship between credit enhancement and expected losses. As of the December remittance date, the pool factor for the GSR 2006-2F is 85% and is 22 months seasoned. Approximately 1.48% of the pool is more than 60 days delinquent. This includes foreclosures and real estate owned of 0.36% and 0.22% respectively. The B-5 bond currently has 0.29% of credit enhancement. The pool factor for the GSR 2006-3F is 85% and the deal is 21 months seasoned. The 60+ delinquencies are 1.18% of the pool, which includes foreclosures and REO of 0.11% and 0.26% respectively. The B-5 bond has 0.29% of credit enhancement. The GSR 2006-AR2 Group1 and Group2 has a pool factor of 12% and 80% respectively. Group1 is 20 months seasoned and Group2 is 20 months seasoned. The 60+ delinquencies for Group1 and Group2 are 12.75% and 1.89% of the pool respectively, which includes REO of 4.61% for Group1 and 0.20% for Group2. The Group2 has foreclosures of 0.71%. The 1B5 bond has 3.17% of credit enhancement. Wells Fargo Bank, N.A., rated 'RMS1' by Fitch, acts as a Master Servicer for the above transactions. HARRAH'S ENT: Fitch Withdraws 'BB+' Issuer Default Rating --------------------------------------------------------- Fitch Ratings has withdrawn these ratings for Harrah's Entertainment, Inc. and Harrah's Operating Co.: -- HET Issuer Default Rating 'BB+'; -- HOC Issuer Default Rating 'BB+'; -- Senior Unsecured bank credit facilities 'BB+'; -- Senior Unsecured notes 'BB+' -- Senior Unsecured subordinated notes 'BB-' Based on publicly available information regarding the proforma capital structure for the leveraged buyout by Apollo Management LP and Texas Pacific Group, Fitch believes that HET's IDR would be rated no higher than 'B' and the existing $4.6 billion of unsecured debt that is being rolled over in the transaction would be rated no higher than 'CCC+'. However, Fitch is withdrawing its ratings because it believes that disclosure of financial information is inadequate for Fitch to maintain ratings or rate the LBO transaction, which is valued at roughly $31.2 billion including sponsor equity and rollover debt. HOFF JEWELERS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Hoff Jewelers Inc. 833 SW Third Street New Brighton, MN 55112 Bankruptcy Case No.: 08-30220 Type of Business: The Debtor is a family owned and operates jewelry store. See: http://www.hoffjewelers.com/ Chapter 11 Petition Date: January 18, 2008 Court: District of Minnesota (St Paul) Judge: Dennis D. O'Brien Debtors' Counsel: Steven B. Nosek, Esq. Steven Nosek 701 4th Avenue South, Suite 300 Minneapolis, MN 55415 Tel: (612) 335-9171 Fax: (612) 333-9220 Estimated Assets: Less than $50,000 Estimated Debts: $1 million to $10 million Consolidated Debtors' List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Goldstar Trust Company $1,084,869 PO Box 719 Canyon, TX 79015 Larry Ricke Attorney for AD $771,506 Leonard Street & Deinard Diamonds/Amos 150 South 5th Street #2300 Dabush Minneapolis, MN 55402 SB&T Designs LTD $469,941 SB&T House, Plot #GJ3 Seepz++ Andheri East Mumbaia India 400096 American Finance Solutions $146,488 Frank Hoff $143,609 SB&T Gem Imports $141,889 Astra-Mechlin Diamonds LTD $103,857 A. Benjamini $92,862 K.P. Sanghvi, Inc. $76,568 L.I.D. $75,151 Suashish Diamonds $63,848 B.H. Multicom $58,157 Dynamic Design Group, Inc. $40,798 Sumit Diamond Corp $38,472 Rama-International, LLC $35,198 Nili Jewelery Corp $34,076 Interings $33,157 Royal Chain $20,384 CBS Outdoor $23,320 Burnsville Center $23,010 HOVNANIAN ENT: Fitch Lowers Issuer Default Rating to B- from BB- ---------------------------------------------------------------- Fitch Ratings has downgraded Hovnanian Enterprises, Inc. Issuer Default Rating and outstanding debt ratings as: -- IDR to 'B-' from 'BB-'; -- Senior unsecured notes to 'B-/RR4' from 'BB-'; -- Unsecured bank credit facility to 'B-/RR4' from 'BB-'; -- Senior subordinated notes to 'CCC/RR6' from 'B'; -- Series A perpetual preferred stock to 'CCC-/RR6' from 'B-'. Fitch has also placed HOV on Rating Watch Negative. Fitch's '4' Recovery Rating on HOV's unsecured notes and revolving credit facility indicate average (30%-50%) recovery prospects for holders of these debt issues. HOV's exposure to performance bonds and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debt holders. The 'RR6' on HOV's senior subordinated notes and preferred stock indicate poor recovery prospects (10%-30%) in a default scenario. Fitch applied a liquidation value analysis for these RRs. The downgrade reflects the current difficult U.S. housing environment, current and expected negative trends in HOV's operating margins and meaningful deterioration in credit metrics, especially interest coverage and debt/EBITDA ratios. HOV was slower than most in braking its growth. Consequently the inventories, although now starting to come down, are above comfort levels and debt leverage remains above the company's targeted levels. While cash flow from operations only totaled $62 million for all of its fiscal year 2007, HOV generated $357 million of cash from operations during its fourth quarter, allowing the company to pay down debt by $390 million from the third quarter- 2007. HOV projects it will generate in excess of $100 million of cash flow in 2008. The Rating Watch Negative reflects HOV's exposure to liquidity risk given ongoing negotiations with its bank group regarding modifications to its revolving credit agreement. As of Oct. 31, 2007, HOV was not in compliance with the tangible net worth and leverage covenants under its revolving credit agreement. HOV was able to obtain a temporary waiver of compliance from its bank group and the facility was downsized from $1.5 billion to $1.2 billion. Resolution of the Rating Watch Negative will be based on the company's ability to negotiate a new bank credit facility. Fitch will review the terms and conditions of the new agreement, including the amount of funds the company can access under it. Future ratings and outlook will be influenced by the economy and broad housing market trends as well as company-specific activity, such as land and development spending, general inventory levels, speculative inventory activity, gross and net new order activity, debt levels and free cash flow trends and uses. The possibility of the housing downturn continuing longer and becoming deeper than anticipated could have broad ratings implications for homebuilders. Ratings for HOV are influenced by the company's successful execution of its business model, land policies and geographic, price point and product line diversity. HOV has been an active consolidator in the homebuilding industry which had contributed to above average growth during the seven years ending in 2005, but has kept debt levels somewhat higher than its peers. Management has also exhibited an ability to quickly and successfully integrate its acquisitions. Significant insider ownership aligns management's interests with HOV's long term financial health. HOV employs conservative land and construction strategies, typically purchasing land only after necessary entitlements have been obtained so that development or construction may begin as market conditions dictate. HOV extensively uses lot options. The use of land option contracts without specific performance clauses gives HOV the ability to renegotiate price/terms or void the option which limits down side risk in market downturns and provides the opportunity to hold land with minimal investment. HOV controls roughly a 5.25-year supply of land based on latest 12 months home deliveries, 40% of which are owned and the balance controlled through options. HOV has reduced its land holdings by approximately 32% since Oct. 31, 2006 and by 47% from its peak level at the end of April 2006. HOV's unconsolidated joint venture activities are still moderate in size and conservatively levered. HOV has been successful in reducing speculative built homes during the fourth quarter of 2007, reducing the total by about 14.4% versus the third quarter of 2007 and down 27.4% compared to the peak (third quarter of 2006). Nevertheless, the 2,390 unsold homes at the end of the fiscal year represented about 5.5 started and unsold homes per community. It is likely that spec homes would be priced aggressively in order to move the inventory, to the disadvantage of margins. HYDROCHEM INDUSTRIAL: S&P Withdraws 'B' Corporate Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings, including its 'B' corporate credit rating, on Deer Park, Texas-based HydroChem Industrial Services Inc. at the company's request. INDYMAC RESIDENTIAL: Expected Losses Cue Fitch to Junk Ratings -------------------------------------------------------------- Fitch Ratings has taken various rating actions on these IndyMac Residential Asset Securities Trust mortgage pass-through certificate: RAST 2007-A3 -- Class A affirmed at 'AAA'; -- Class B-1 downgraded to 'AA-' from 'AA'; -- Class B-2 downgraded to 'BBB+' from 'A'; -- Class B-3 downgraded to 'BB-' from 'BBB'; -- Class B-4 downgraded to 'C/DR4' from 'BB'; -- Class B-5 downgraded to 'C/DR5' from 'B'. The affirmations affect approximately $329.9 million in outstanding certificates and reflect adequate relationships of credit enhancement to future loss expectations. The downgrades, affecting approximately $20.3 million of the outstanding certificates, reflect deterioration in the relationship between credit enhancement and expected losses. As of the December remittance date, the pool factor for the deal is 96% and is 10 months seasoned. Approximately 3.01% of the pool is more than 60 days delinquent. This includes foreclosures and real estate owned (REO) of 1.09% and 0.21% respectively. The B-5 bond currently has 0.41% of credit enhancement. IndyMac Bank, FSB, rated 'RPS2+' and placed on Rating Watch Negative by Fitch, acts as a Servicer for the above transaction. INTERSTATE BAKERIES: Yucaipa Disapproves Disclosure Statement ------------------------------------------------------------- Yucaipa Companies LLC and several pension funds and contract parties object to the approval of the Disclosure Statement filed by Interstate Bakeries Corporation and its debtor-affiliates with respect to its Plan of Reorganization, dated Nov. 5, 2007. Yucaipa argues that the Disclosure Statement does not contain adequate information under Section 1125 of the Bankruptcy Code. The principle of disclosure and sufficient data is "[o]f prime importance in the reorganization process," Robert A. Klyman, Esq., at Latham & Watkins LLP, in Los Angeles, California, states on Yucaipa's behalf. According to Mr. Klyman, the information regarding the Debtors' liquidation analysis, claim estimates and the company's projections should be the salient points in the Disclosure Statement. Similarly, he adds, the Plan's essential pre- conditions with respect to its new labor contract with the International Brotherhood of Teamsters should have been disclosed. Moreover, Mr. Klyman asserts that it is well settled that a disclosure statement should not be approved where a proposed plan is unconfirmable. Mr. Klyman argues that the Plan is "patently unconfirmable" because: -- the Plan depends entirely on a business plan that requires massive concessions from the Teamsters; and -- the Teamsters have repeatedly and consistently stated that it prefers liquidation to that business plan. "The Debtors have failed to reach agreement with the Teamsters with respect to a new business plan during the lengthy term of these cases, and there is no reason to expect that the Debtors will achieve such agreement by virtue of soliciting votes on the Plan," Mr. Klyman tells the Hon. Jerry W. Venters. To the contrary, Mr. Klyman says, in light of the undisputed history of the Debtors' labor negotiations, such solicitation would be a useless expense to the Debtors' estate and a waste of estate assets. Given that the Plan is unconfirmable, coupled with "the size of the Debtors' cases, the huge number of creditors and interest holders that are entitled to vote on approval of the Plan," the U.S. Bankruptcy Court for the Western District of Missouri should deny the approval of the Disclosure Statement, Mr. Klyman maintains. Reiterating the issues raised by Yucaipa, several multi-employer employee benefit plans contend that the Disclosure Statement is of minimal, if not inadequate, value as evidenced by its failure to include specific critical information, including: (a) the Debtors' assets and their value; (b) IBC's anticipated future; (c) the Debtors' present condition and performance since the Petition Date; (d) sufficient financial information, data, valuations, projections relevant to creditors' decision to accept or reject the Plan; (e) relevant risks imposed on creditors; (f) actual projected realizable vale from recovery of preferential or otherwise avoidable transfers; (g) relationship of the Debtors with their affiliates, subsidiaries, merger or acquisition interests and the Plan proponents; (h) liquidation analysis with the estimated return that creditors would receive under Chapter 7; (i) future management of IBC, including qualifications and compensation; (j) collectibility of accounts receivables and description of counterclaims; (k) accounting method utilized to produce financial information; and (l) the Court's prior order establishing "pass through" treatment of possible future withdrawal liabilities relating to events occurring after the Confirmation Date. In addition, the pension funds note that the Debtors filed a Reorganization Plan in which every attached exhibit is blank. The funds also note that, in an attempt to "blatantly circumvent" the Bankruptcy Code requirements, the Debtors intended to provide the exhibits "at least five days prior to the Voting Deadline or on [the] date approved by the Court." The benefit plans are pension funds managed by the Board of Trustees who sponsor and administer the Plan "for the sole interest of the participants and beneficiaries and in accordance with the documents and instruments governing the Plan." The Pension Funds consist of: * New York State Teamsters Conference Pension and Retirement Fund; * The Teamsters Union Local No. 142; * Western Pennsylvania Teamsters and Employers Pension Fund; * New England Teamsters and Trucking Industry Pension Fund; and * Central States Southeast and Southwest Areas Pension Fund. The Debtors maintained that they remain open to negotiations with the Teamsters with respect to the collective bargaining agreements, but have have failed to attain any concessions or agreements in the last four years. The Teamsters, for their part, said that there is a "scant hope" for reaching any agreements with the Debtors, Ronald S. Weiss, Esq., Berman, DeLeve, Kuchan & Chapman, L.C., in Kansas City, Missouri, says on behalf of the New York and Central, Southeast and Southwest States Pension Funds. Mr. Weiss contends that the Disclosure Statement provides for discriminatory treatment of withdrawal liability which conflicts the Court order that provided a different treatment for a creditor of the same class. The Court ruling is with respect to the Central States Pension Funds Settlement approved by the Court in November 2006. Moreover, Mr. Weiss notes, the Debtors' treatment of potential withdrawal liabilities conflicts with the Central States Agreement and established law. The Debtors specifically stated that they contributed more than $300,000,000 to all multi employer plans for fiscal years 2007, 2006 and 2005, and that their total contingent liability in the event of their complete withdrawal will range from $800,000,000 to $900,000,000. However, the Debtors are attempting to discharge potential future withdrawal liabilities, which is against the statutory provisions of ERISA and the public policy to "protect the solvency of multi employer pension plans." Accordingly, the Pension Funds unanimously maintain that the Disclosure Statement is not feasible, and thus the Plan is unconfirmable. Furthermore, the Sun-Maid Growers of California argues that the Disclosure Statement failed to provide the Debtors' proposed treatment of, among others, their executory contracts and unexpired leases with Sun-Maid. The exhibit that purportedly contains these information is blank, Sun-Maid points out. In a separate Court filing, Automotive Rentals, Inc., states that it is unable to determine the information on how the Debtors intend to treat their leases. The Debtors also does not disclose, among others, these relevant information: -- the estimated claim amounts and percentage recovery for each class of creditor and the enterprise value of the Reorganized Debtors; -- the Debtors' estimation concerning non-consolidated recoveries and potential distribution in a consolidated plan, which was shared with the Official Committee of Unsecured Creditors; -- a copy of a commitment letter to assist creditors in deciding to accept or reject the Plan that essentially transfers ownership of the Debtors to the creditors; -- analysis employed by the Debtors in, and reasons for allocating the Debtors' equity and providing the Prepetition Lenders with a super-majority voting status; -- a description of cure that the Debtors propose to pay in connection with any lease or executory contract to be assumed by the Debtors pursuant to the Plan; -- the methodology to be employed in calculating the amount of New Common Stock; -- the criteria to be utilized in designating a "party"; -- the terms and conditions of the Voting Trust Agreement; and -- the estimated value of the undivided interest in each of the Trust Assets. Automotive Rentals also wants to know the reason behind the Debtors' assumption of all existing indemnification obligations arising under the Prepetition Credit Agreement and other prepetition agreements with JP Morgan Chase Bank, N.A., J.P. Morgan Securities, Inc., and the Prepetition Lenders. Automotive Rentals further questions the applicability of the provision concerning certain Surrender of Securities and Instruments, the payments with respect to Disputed Claims, the treatment of Class 2 Secured Creditors. Moreover, the release, exculpation and limitation of liability provisions in the Statement and the Plan should be restricted to ensure they comply with Section 524(e). About IBC Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh-baked bread and sweet goods, under various national brand names, including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and Drake's(R). Currently, IBC employs more than 25,000 people and operates 45 bakeries, as well as approximately 800 distribution centers and approximately 800 bakery outlets throughout the country. The company and seven of its debtor-affiliates filed for chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No. 04- 45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6% senior subordinated convertible notes due Aug. 15, 2014) in total debts. The Debtors filed their Chapter 11 Plan and Disclosure Statement on Nov. 5, 2007. Their exclusive period to to solicit acceptances of that Plan expired on Jan. 7, 2008. The Debtors have been been actively seeking higher and better offers to the proposed financing and plan support agreements and received interest from multiple parties regarding the opportunity to invest in the company. The deadline to submit final bids lapsed on Jan. 15, 2008, without any qualifying alternative proposals received for funding its plan of reorganization in accordance with the Alternative Proposal Procedures previously approved by the Bankruptcy Court. The Disclosure Statement Hearing is scheduled for Jan. 29, 2008. The Debtors have asked the Court to hold the Plan Confirmation Hearing on March 12, 2008. (Interstate Bakeries Bankruptcy News, Issue No. 83; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) JP MORGAN: Fitch Downgrades Ratings on 25 Certificate Classes ------------------------------------------------------------- Fitch Ratings has affirmed 48, downgraded 25 and placed 2 classes on Rating Watch Negative from these J.P. Morgan Mortgage Trust pass-through certificates: Series 2006-A1 -- Class A affirmed at 'AAA'; Series 2006-A2 Aggregate Pool 1 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 downgraded to 'BB+' from 'BBB'; -- Class B-4 downgraded to 'B' from 'BB'. -- Class B-5 downgraded to 'C/DR4' from 'B'. Series 2006-A3 Aggregate Pool 1 (Groups 1 - 5) -- Class A affirmed at 'AAA'; -- Class 1-B-1 affirmed at 'AA'; -- Class 1-B-2 downgraded to 'A-' from 'A'; -- Class 1-B-3 downgraded to 'BB+' from 'BBB'; -- Class 1-B-4 downgraded to 'C/DR3' from 'BB'; -- Class 1-B-5 downgraded to 'C/DR5' from 'B'. Series 2006-A4 Aggregate Pool 1 (Pools 1 - 5) -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 downgraded to 'A-' from 'A'; -- Class B-3 downgraded to 'B+' from 'BBB'; -- Class B-4 downgraded to 'C/DR4' from 'BB'; -- Class B-5 downgraded to 'C/DR5' from 'B'. Series 2006-A4 Pool 6 -- Class A affirmed at 'AAA'; -- Class 6-B-1 affirmed at 'AA'; -- Class 6-B-2 affirmed at 'A'; -- Class 6-B-3 affirmed at 'BBB'; -- Class 6-B-4 affirmed at 'BB'; -- Class 6-B-5 affirmed at 'B'; Series 2006-A5 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 affirmed at 'BBB'; -- Class B-4 affirmed at 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B'. Series 2006-A6 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 rated 'BBB', placed on Rating Watch Negative; -- Class B-4 downgraded to 'B' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B' Series 2006-A7 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 downgraded to 'A-' from 'A'; -- Class B-3 downgraded to 'BB' from 'BBB'; -- Class B-4 downgraded to 'C/DR4' from 'BB'; -- Class B-5 downgraded to 'C/DR5' from 'B' Series 2006-S1 -- Class A affirmed at 'AAA'; -- Class A-M affirmed at 'AA+'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 affirmed at 'BBB'; -- Class B-4 downgraded to 'BB-' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B' Series 2006-S2 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 downgraded to 'BB+' from 'BBB'; -- Class B-4 downgraded to 'B' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B'. Series 2006-S3 Aggregate Group 1 (Pools 1 & 2) -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 affirmed at 'BBB'; -- Class B-4 downgraded to 'B' from 'BB'; -- Class B-5 downgraded to 'C/DR4' from 'B'. Series 2006-S3 Group 2 (Pools 3 & 4) -- Class A affirmed at 'AAA'; -- Class IIB-1 affirmed at 'AA'; -- Class IIB-2 affirmed at 'A'; -- Class IIB-3 affirmed at 'BBB'; -- Class IIB-4 affirmed at 'BB'; -- Class IIB-5 affirmed at 'B'. Series 2006-S4 -- Class A affirmed at 'AAA'; -- Class M affirmed at 'AA+'; -- Class B-1 affirmed at 'AA'; -- Class B-2 affirmed at 'A'; -- Class B-3 affirmed at 'BBB'; -- Class B-4 affirmed at 'BB'; -- Class B-5 rated 'B', placed on Rating Watch Negative. The affirmations affect approximately $9.7 billion in outstanding certificates and reflect adequate relationships of credit enhancement to future loss expectations. The downgrades reflect the deterioration in the relationship of CE to future loss expectations and affect $88.7 million in outstanding certificates. In addition, Rating Watch Negative affects $5 million of the outstanding certificates. The underlying collateral for the aforementioned transactions consist primarily of fixed and adjustable-rate, conventional, fully amortizing, first lien residential mortgage loans extended to prime borrowers. The mortgage loans were either originated by various sources. As of the December 2007 distribution date, Series 2006-A1 through 2006-A7 are seasoned between 12 - 23 months. The pool factors range from approximately 77% to 92%. For the same distribution date, Series 2006-S1 through 2006-S4 are seasoned between 12 - 21 months. The pool factors range from approximately 80% to 87%. JP MORGAN: Fitch Junks Ratings on Two Certificate Classes --------------------------------------------------------- Fitch Ratings has affirmed one and downgraded five classes from J.P. Morgan Alternative Loan Trust pass-through certificates, as: Series 2007-A1 -- Class A affirmed at 'AAA'; -- Class C-B-1 downgraded to 'A+' from 'AA'; -- Class C-B-2 downgraded to 'BBB' from 'A'; -- Class C-B-3 downgraded to 'B' from 'BBB'; -- Class C-B-4 downgraded to 'C/DR4' from 'BB'. -- Class C-B-5 downgraded to 'C/DR5' from 'B'. The affirmations affect approximately $229.3 million in outstanding certificates and reflect adequate relationships of credit enhancement to future loss expectations. The downgrades reflect the deterioration in the relationship of CE to future loss expectations and affect $13.8 million in outstanding certificates. As of the December 2007 distribution date, the transaction is seasoned 10 months and the pool factor is approximately 92%. The percentage of loans that are 60 days or more delinquent is 5.08%. There are no losses to date. KORYN ROLSTAD: Case Summary & Five Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Koryn E. Rolstad PO Box 9446 Seattle, WA 98109 Bankruptcy Case No.: 08-10238 Chapter 11 Petition Date: January 17, 2008 Court: Western District of Washington (Seattle) Judge: Philip H. Brandt Debtor's Counsel: Michael P. Harris, Esq. Attorney at Law 2125 5th Avenue Seattle, WA 98121 Tel: (206) 622-7434 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's list of its Five Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Boeing Employees Credit Union Bank Loan $14,970 P.O. Box 97050 Seattle, WA 98124-9750 Citibank Consumer Debt $4,711 P.O. Box 6500 Sioux Falls, ID 57117-6500 US Airways Mastercard Bank Loan $4,711 P.O. Box 8801 Wilimington, DE 19899-8801 Beneficial _ HSBC Bank Loan $3,966 Nordstrom Consumer Debt $2,900 LEISURE LIVING: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Leisure Living Superstore, Inc. 40980 County Center Drive Temecula, CA 92591 Tel: (951) 719-2900 Bankruptcy Case No.: 08-10466 Type of Business: The Debtor is a Sundance Spas retailer. Chapter 11 Petition Date: January 16, 2008 Court: Central District Of California (Riverside) Judge: Meredith A. Jury Debtor's Counsel: Robert B. Rosenstein, Esq. Rosenstein & Hitzeman 28600 Mercedes Street, Suite 100 Temecula, CA 92590 Tel: (951) 296-3888 Fax: (951) 296-3889 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's list of its 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ American Express Trade Debt $276,610 P.O. Box 0001 Los Angeles, CA 90096 State Board of Equalization Sales Tax $205,462 Attn: Bankruptcy P.O. Box 942879 Sacramento, CA 94279-7072 Press Enterprise Advertising $154,421 P.O. box 12009 Riverside, CA 92502-2209 Murrieta Spectrum Rent $83,461 Unimax Express Storage $32,025 State Franchise Tax Board Payroll Taxes $28,004 Select Remedy Temporary Services $24,945 Volt Services Group Temporary Services $21,509 Via Media Advertising $16,541 San Diego Union Tribune Trade Debt $16,034 Kathy 101.3 FM Advertising $20,213 LENNAR CORP: Names Sherrill Hudson as Board Independent Member -------------------------------------------------------------- Lennar Corporation's board of directors has appointed Sherrill W. Hudson, the chairman and chief executive officer of TECO Energy Inc., to serve as an independent member of the board and a member of the board's audit committee and compensation committee. Mr. Hudson's appointment increases the size of the company's board to eight members, and the number of "independent" directors, as defined under the New York Stock Exchange Corporate Governance Standards, to seven. Mr. Hudson, 65, is chairman and chief executive officer of TECO Energy. Prior to joining TECO in July 2004, Mr. Hudson spent 37 years with Deloitte & Touche LLP until he retired in 2002, after spending 19 years in Miami as Managing Partner for its South Florida offices. While at Deloitte & Touche LLP, Mr. Hudson became very familiar with both Lennar and its management team. "We are pleased to add an individual with Sherrill Hudson's outstanding experience and qualifications to our Board of Directors," Sidney Lapidus, lead director of the board of directors of Lennar Corporation, said. "We believe that Sherrill's business acumen and experience will provide our company with invaluable insight during these challenging times." Mr. Hudson is a member of the Florida Institute of Certified Public Accountants, which recognized him as the 2006 Outstanding CPA in Business and Industry. He is also known for his community service activities, including serving as chair of the United Way of Tampa Bay 2007 Campaign, a board member of The Florida Council of 100 and chair of the Council of Governors of the Tampa Bay Partnership. In addition to being chairman of the board of TECO Energy, Mr. Hudson also serves on the boards of Publix Super Markets, Inc. and The Standard Register Company. About Lennar Corp. Headquartered in Miami, Florida, Lennar Corporation (NYSE: LEN and LEN.B) -- http://www.lennar.com/-- founded in 1954, builds affordable, move-up and retirement homes primarily under the Lennar brand name. Lennar's Financial Services segment provides mortgage financing, title insurance, and closing services for both buyers of the company's homes and others. * * * As reported in the Troubled Company Reporter on Nov. 6, 2007, Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured debt ratings on Lennar Corp. to 'BB+' from 'BBB'. The rating actions affect approximately $2.2 billion of senior unsecured notes. Concurrently, S&P lowered the commercial paper rating to 'B' from 'A-3'. The outlook remains negative. LONG BEACH MORTGAGE: Moody's Downgrades and Reviews 18 Ratings -------------------------------------------------------------- Moody's Investors Service downgraded and placed under review for possible downgrade eighteen tranches from seven deals issued by Long Beach Mortgage Company. The transactions are backed by primarily first lien adjustable and fixed rate subprime mortgage loans originated by Long Beach. The actions are based on the analysis of the credit enhancement provided by subordination, overcollateralization and excess spread relative to the expected loss. The transactions have small pool factors which range between 2.5% to 8.5%. The downgrades on the tranches are driven by the erosion of the OC which left the most junior tranches exposed to future losses and the tranches successively above them in a weaker position. Complete rating actions are: Issuer: Long Beach Mortgage Loan Trust 2000-1 -- Cl. M-1, downgraded to Ba2 from Baa3; -- Cl. M-2, downgraded to Ca from Caa1; Issuer: Long Beach Mortgage Loan Trust Asset-Backed Certificates, Series 2001-3 -- Cl. M-1, on review for possible downgrade, currently Aa2; -- Cl. M-2, downgraded to Caa1 from Ba3; -- Cl. M-3, downgraded to C from Caa3; Issuer: Long Beach Mortgage Loan Trust 2001-4 -- Cl. M-2, downgraded to B3 from Ba3; -- Cl. II-M-1, on review for possible downgrade, currently Aa2; Issuer: Long Beach Mortgage Loan Trust 2002-1 -- Cl. M-2, downgraded to Ba2 from Baa3; -- Cl. M-3, downgraded to Caa3 from Caa1; Issuer: Long Beach Mortgage Loan Trust 2002-2 -- Cl. M-2, downgraded to Baa1 from A2; -- Cl. M-3, downgraded to Caa1 from B2; -- Cl. M-4A, downgraded to C from Ca; -- Cl. M-4B, downgraded to C from Ca; Issuer: Long Beach Mortgage Loan Trust 2002-5 -- Cl. M-3, downgraded to B3 from Ba2; -- Cl. M-4A, downgraded to C from Caa1; -- Cl. M-4B, downgraded to C from Caa1; Issuer: Long Beach Mortgage Loan Trust 2003-1 -- Cl. M-3, downgraded to B3 from Baa2; -- Cl. M-4, downgraded to C from Caa3. MASHANTUCKET PEQUOT: Moody's May Downgrade Ba1 Note Rating ---------------------------------------------------------- Moody's Investors Service placed Mashantucket (Western) Pequot Tribal Nation's ("Foxwoods") ratings on review for possible downgrade. Ratings affected include Foxwoods' Baa2 Special Revenue Obligations, Baa3 Subordinated Special Revenue Bonds, and Ba1 Series A Notes. The review for downgrade is in response to Foxwoods' recent announcement that its fiscal 2008 first quarter EBITDA will be about $23 million lower than the comparable prior year period. Lower-than-expected EBITDA along with increased competition in the Northeast US and a possible consumer-based recession could make it more difficult for Foxwoods to meet the longer-term debt/EBITDA target needed to maintain its current ratings. In order for Foxwoods to maintain its current rating, debt/EBITDA would need to be in the range of 4.0 to 4.5 times by the end of fiscal 2009. Foxwoods debt/EBITDA for the fiscal-year ended Sep. 30 2007 was about 4.0 times, and about 4.7 times pro forma for its Nov. 2007 debt financing. Debt/EBITDA is expected to increase further in the near-term as a result of planned expansion and development activity. Foxwoods attributed a majority of its first quarter 2008 decline to lower hold percentages and operational problems related to a recent direct mail campaign. To a lesser degree, competition in the Northeast US, higher gas prices, and less favorable economic conditions also contributed to the decline. Moody's review will focus on Foxwoods' ability to achieve debt/EBITDA in the range of 4.0 to 4.5 times by the end of fiscal 2009 in light of the above mentioned challenges. Any downgrade would likely be limited to one-notch. Foxwoods Resort Casino is owned by the Mashantucket Pequot Tribal Nation (Tribe). The Mashantucket Pequot Gaming Enterprise, a wholly-owned, unincorporated division of the Tribe, conducts Foxwoods' gaming and resort operations. The Tribe is a federally recognized Indian tribe with a reservation encompassing approximately 1,400 acres in southeastern Connecticut. MASTR ADJUSTABLE: Class B-5 Obtains S&P's Junk Rating from 'B' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on class B-5 from MASTR Adjustable Rate Mortgages Trust 2003-7 to 'CCC' from 'B'. At the same time, S&P affirmed its ratings on the remaining 13 classes from this series, and on all six classes from series 2004-2. The downgrade of class B-5 from series 2003-7 reflects high delinquencies relative to the available credit support in the deal. Although the transaction has incurred only $252,869 in losses to date, foreclosure and real estate owned asset amounts currently total approximately $1.09 million. Class B-5 has a current certificate balance of $363,000 and current subordination of $156,993. As a result, a loss severity of only 15% could cause class B-5 to default. As of the December 2007 remittance period, total delinquencies were 2.77% of the current principal balance, and severe delinquencies (90-plus-days, foreclosures, and REOs) were 2.77%. The affirmations reflect current and projected credit support percentages that are sufficient to support the certificates at their current rating levels. A combination of subordination, excess spread, and overcollateralization provide credit support for these transactions. The collateral for these transactions consists of adjustable-rate, conventional mortgage loans secured by first liens on primarily one- to four-family residential properties with terms to maturity of no more than 30 years. Rating Lowered MASTR Adjustable Rate Mortgages Trust Rating ------ Series Class To From ------ ----- -- ---- 2003-7 B-5 CCC B Ratings Affirmed MASTR Adjustable Rate Mortgages Trust Series Class Rating ------ ----- ------ 2003-7 1-A-1, 1-A-X, 2-A-1, 2-A-X, 3-A-1, 3-A-X AAA 2003-7 4-A-1, 4-A-X, 5-M-1, B-1 AAA 2003-7 B-2 AA- 2003-7 B-3 A- 2003-7 B-4 BB 2004-2 2-A-1, 3-A-1 AAA 2004-2 M-1 AA+ 2004-2 M-2 AA 2004-2 M-3 AA- 2004-2 B A MERRILL LYNCH: Moody's Junks "B1" Rating on Class B-1 Debentures ---------------------------------------------------------------- Moody's downgrades three classes issued by Merrill Lynch Mortgage Investors, Inc. 2003-WMC1. The transaction is backed by adjustable and fixed-rate subprime mortgage loans recently originated by WMC Mortgage Corp. The current pool factor is 4.18%. The actions are based on the analysis of the credit enhancement provided by subordination, overcollateralization and excess spread relative to the expected loss. The downgrades on the certificates are driven by the severe erosion of the OC which left the Cl. B-2 exposed to future losses and the tranches successively above it in a weaker position. Complete rating actions are: Issuer: Merrill Lynch Mortgage Investors, Inc. 2003-WMC1 -- Cl. M-2, downgraded to Baa1 from A2; -- Cl. B-1, downgraded to Caa1 from B1; -- Cl. B-2, downgraded to C from Caa1. MERRILL LYNCH: Moody's Reviews Ba1 Rating for Likely Downgrade -------------------------------------------------------------- Moody's places on review for possible downgrade two classes issued by Merrill Lynch Mortgage Investors Trust 2003-OPT1. The transaction is backed by adjustable-rate and fixed-rate subprime mortgage loans originated by Option One Mortgage Corporation. The actions are based on the analysis of the credit enhancement provided by subordination, overcollateralization, lender paid mortgage insurance and excess spread relative to the expected loss. Complete rating actions are: Issuer: Merrill Lynch Mortgage Investors Trust Series 2003-OPT1 -- Cl. B-2, placed on review for downgrade, currently Baa2; -- Cl. B-3, placed on review for downgrade, currently Ba1. MUSICLAND HOLDING: Parties Extend Trade Claims Filing to Feb. 29 ---------------------------------------------------------------- In a stipulation approved by the U.S. Bankruptcy Court for the Southern District of New York, Musicland Holding Corp. and its debtor-affiliates, the Official Committee of Unsecured Creditors, and the Informal Committee of Secured Trade Vendors further extend, until Feb. 29, 2008 or the effective date of the Debtors' second amended plan of liquidation, the Creditors Committee's period to file the DIP Secured Trade Creditor claims against certain entities. These entities include Buena Vista Home Entertainment, Inc., Metro-Goldwyn-Mayer Home Entertainment, LLC, Warner Home Video, Inc., Credit Suisse International, Cargill Financial Services International, Inc., Varde Investment Partners, L.P., Bond Street Capital, LLC, and Hain Capital Group, LLC. About Musicland Based in New York, New York, Musicland Holding Corp., is a specialty retailer of music, movies and entertainment-related products. The Debtor and 14 of its affiliates filed for chapter 11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No. 06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis, represents the Debtors in their restructuring efforts. Mark T. Power, Esq., at Hahn & Hessen LLP, represents the Official Committee of Unsecured Creditors. At March 31, 2007, the Debtors disclosed $20,121,000 in total assets and $321,546,000 in total liabilities. On May 12, 2006, the Debtors filed their Joint Plan of Liquidation with the Court. On Sept. 14, 2006, they filed an amended Plan and a Second Amended Plan on Oct. 13, 2006. The Court approved the adequacy of the Amended Disclosure Statement on Oct. 13, 2006. The hearing to consider confirmation of the 2nd Amended Joint Plan started on Nov. 28, 2006. (Musicland Bankruptcy News, Issue No. 44; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) MZT HOLDINGS: Files Certificate of Dissolution in Delaware ---------------------------------------------------------- MZT Holdings Inc., formerly known as Matritech Inc., has filed a Certificate of Dissolution with the Secretary of the State of Delaware. In connection with this filing, effective as of the close of business on Jan. 18, 2008, MZT Holdings closed its stock transfer books and discontinued recording transfers of shares of its common stock, except for transfers by will, intestate succession or operation of law. MZT Holdings also has made a series of filings with the Securities and Exchange Commission to terminate certain registration statements it had filed on Forms S-3 and S-8 to register shares of its common stock. As a result of these filings, holders of shares of the company's common stock may no longer rely on these registration statements in connection with sales or other transfers of shares of the MZT Holdings' common stock. Finally, MZT Holdings has submitted a letter to the SEC seeking to confirm that the SEC would not take enforcement action against MZT Holdings if, effective as of Jan. 1, 2008, MZT Holdings ceased to file certain periodic reports required under Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder. MZT Holdings intends to continue to disclose material events on Form 8-K when and if appropriate. About MZT Holdings Inc. Headquartered in Newton, Massachusetts, MZT Holdings Inc. fka Matritech Inc. (Amex: MZT) -- http://www.matritech.com/-- is a marketer and developer of protein-based diagnostic products for the early detection of cancer. The company uses its patented proteomics technology to develop diagnostics for the detection of a variety of cancers. The company's first two products, the NMP22(R) Test Kit and NMP22(R) BladderChek(R) Test, have been FDA cleared for the monitoring and diagnosis of bladder cancer. The company has discovered other proteins associated with cervical, breast, prostate, and colon cancer. Going Concern Doubt PricewaterhouseCoopers LLP raised substantial doubt about Matritech Inc.'s ability to continue as a going concern citing recurring losses and negative cash flows from operations after auditing the company's financial statements as of Dec. 31, 2006, and 2005. Matritech Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $6.7 million in total assets, $16.5 million in total liabilities, and $104,312 in preferred stock, resulting in a $9.9 million total shareholders' deficit. NACIO SYSTEMS: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Nacio Systems, Inc. 55 Leveroni Court Novato, CA 94949 Bankruptcy Case No.: 08-10078 Type of Business: The Debtor offers internet services, including storage, hosting, products, application development and strategic thinking. It provides both solutions and integrated delivery systems. See http://www.nacio.com/ Chapter 11 Petition Date: January 18, 2008 Court: Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Craig K. Welch, Esq. Welch and Olrich, L.L.P. 809 Petaluma Boulevard North Petaluma, CA 94952 Tel: (707) 782-1790 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million The Debtor did not file a list of its largest unsecured creditors. OAK MESA: Case Summary & Eight Largest Unsecured Creditors ---------------------------------------------------------- Lead Debtor: Oak Mesa Investors, LLC 470 East Harrison Street Corona, CA 92879 Bankruptcy Case No.: 08-10397 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Buffalo Land Development Co. LLC 08-10398 Chapter 11 Petition Date: January 16, 2008 Court: District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtors' Counsel: Richard F. Holley, Esq. 400 S. Fourth Street, 3rd Floor Las Vegas, NV 89101 Tel: (702) 791-0308 Fax: (702) 791-1912 http://www.nevadafirm.com/ Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Consolidated Debtors' List of Eight Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Beneficiaries, Compass FP real property $38,649,185 Corp. 333 Seventh Avenue Third Floor New York, NY 10001 LBREP/L-SunCal Summerwind real property $11,380,245 Ranch LLC 1259 Corona Pointe Court Suite 210 Corona, CA 92879 Riverside County Treasurer real property $27,651 c/o Paul McDonnell P.O. Box 12005 Riverside, CA 92502-2205 Fiesta Development Inc. services $4,060 Pachulski Stang Zieh Young services $6,181 San Bernardino Treasurer real property $1,664 Valentin Cenoz pro rata portion $1,081 OWNIT MORTGAGE: Court Confirms Third Amended Liquidation Plan ------------------------------------------------------------- The Honorable Kathleen Thompson of the United States Bankruptcy Court for the Central District of California confirmed Ownit Mortgage Mortgage Solutions Inc.'s Third Amended Chapter 11 Plan of Liquidation. As reported in the Troubled Company Reporter on Sept. 21, 2007, Judge Thompson approved the adequacy of the Debtor's Second Amended Disclosure Statement. Overview of the Plan The Plan contemplates the transfer of all of the Debtor's assets, including the prosecution of causes of action, to the OWNIT Liquidating Trust, which will liquidate the assets, including the prosecution of any right of action held by the Ownit liquidating truste, and distribute the proceeds to holders of allowed claims and allowed unclassified claims in satisfaction of the Debtor's obligations. Moreover, the equity disbursing agent will distribute any remaining amounts in the OWNIT Liquidating Trust to the holders of allowed interests, if all: -- allowed claims, including subordinated allowed General Unsecured, Allowed Administrative and Allowed Unclassified Claims are paid in full, with any and all accrued postpetition interest; -- post effective date plan expenses are paid in full; and -- amounts payable pursuant to Section 726(a) to 726(a)(5), inclusive, are paid. Treatment of Claims Under the Plan, these claims will be paid in full: -- Administrative Claims; -- Priority Tax Claims; and -- Priority Non-Tax Claims. At the option of the liquidating trustee, each holder of Secured Claims will receive either of these treatments, in full: a) collateral in which the holder has a security interest; b) any proceeds actually received by the Debtor or liquidtaing trustee from the sale or dispostion of the collateral, which the holder has a security interest; c) cash in the amount of the holder's allowed claim; or d) other distribution. On the effective date of the Plan, each holder of these claims will be entitled to receive an allocated Ownit liquidating trust interest: -- General Unsecured Claim; and -- Subordinated Allowed General Unsecured Claim. However, no distribution will be made to any holder of Subordinated Allowed General Unsecured Claims until all General Unsecured claims are paid in full. Equity Interest will be cancelled and holders will receive a pro rata distribution of cash, if any from the equity pourover account. About Ownit Mortgage Based in Agoura Hills, California, Ownit Mortgage Solutions Inc. is a subprime mortgage lender, which specializes in making loans to borrowers with poor credit or limited incomes. The Debtor filed for chapter 11 protection on Dec. 28, 2006 (Bankr. C.D. Calif. Case No. 06-12579). Jonathan J. Kim, Esq., Linda F. Cantor, Esq., and Scotta E. McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtor. The Debtor selected The Trumbull Group as noticing and claims agent. The Official Committee of Unsecured Creditors is represented by Stutman, Treister & Glatt Professional Corp. The Debtor's schedules showed total assets of $697,550,849 and total liabilities of $819,131,179. PEP BOYS: Moody's Puts All Ratings Under Review for Possible Cuts ----------------------------------------------------------------- Moody's Investors Service placed all ratings of Pep Boys Manny Moe & Jack under review for possible downgrade, including the corporate family rating of B1. The review was prompted by the continuing negative comparable store sales trend, the weak interest coverage, the recent announcement of the departure of Pep Boys' CFO, and Moody's concern that the slowdown in consumer spending could prevent it from maintaining a credit profile consistent with its present ratings. Ratings placed under review for possible downgrade: -- Corporate family rating at B1 -- Probability of default rating at B1 -- $155 million senior secured term loan due 2013 at Ba3 -- $200 million senior subordinated notes due 2014 at B3. Ratings withdrawn: -- $200 senior secured term loan due 2011 at Ba2 Moody's review will focus on the operating performance, cash flow generation, the company's ability to improve leverage and interest coverage metrics as was originally expected. Moody's will also evaluate the company's new strategic plan to determine the likelihood of it being able to reverse Pep Boys' negative comparable store sales trends, improve margins, and restore credit metrics to more appropriate levels. Headquartered in Philadelphia, Pennsylvania, Pep Boys operates over 560 stores in 35 states and Puerto Rico with last twelve months revenue of approximately $2.2 billion. PETRO ACQUISITIONS: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Lead Debtor: Petro Acquisitions, Inc. 3955 Alexandria Pike Cold Spring, KY 41076 Bankruptcy Case No.: 07-15723 Debtor-affiliates filing separate Chapter 11 petitions on Jan. 18, 2008: Entity Case No. ------ -------- Petro Ventures, Inc. 08-10223 Mayank Jigar Corp. 08-10224 A.F.M. 29130, Inc. 08-10225 A.F.M. 29134, Inc. 08-10227 A.F.M. 29135, Inc. 08-10228 A.F.M. 801, Inc. 08-10230 C.F.M. #29063, Inc. 08-10231 A.F.M. 29128, Inc. 08-10232 A.F.M. 29131, Inc. 08-10233 A.F.M. 504, Inc. 08-10234 BoPec Enterprises, Inc. 08-10235 O.V.A. Real Estate, Inc. 08-10236 C.F.M. #29032, Inc. 08-10237 Debtor-affiliates filing separate Chapter 11 petitions on Nov. 27, 2007: Entity Case No. ------ -------- O.V. Acquisition, Inc. 07-15754 Petro Supply, Inc. 07-15755 A.F.M. 29008, Inc. 07-15756 C.F.M. #29016, Inc. 07-15757 C.F.M. #29027, Inc. 07-15758 A.F.M. 29041, Inc. 07-15761 C.F.M. # 2943, Inc. 07-15762 Shivsagar Corp. 07-15763 Greenfield Convenient #2955, Inc. 07-15764 C.F.M. #29056, Inc. 07-15765 A.F.M. 29061, Inc. 07-15766 A.F.M. 29065, Inc. 07-15767 C.F.M. 29069 Inc. 07-15768 Owenton Cenvenient, Inc. 07-15769 A.F.M.-Remington 86, Inc. 07-15770 A.F.M.-Crookshank 87, Inc. 07-15771 Bhavi & Giri, Inc. 07-15772 C.F.M. #29098 Inc. 07-15773 A.F.M. Dry Ridge 106, Inc. 07-15774 A.F.M. 29107, Inc. 07-15776 A.F.M. 29114, Inc. 07-15777 A.F.M. 29126, Inc. 07-15778 A.F.M. 29127, Inc. 07-15779 C.F.M. #29305, Inc. 07-15780 C.F.M. #29315, Inc. 07-15781 C.F.M. No. 29328, Inc. 07-15782 C.F.M. No. 29331, Inc. 07-15783 A.F.M. 29332, Inc. 07-15784 C.F.M. NO. 29610 07-15785 C.F.M. No. 29614, Inc. 07-15786 Debtor-affiliates filing separate Chapter 11 petitions on Nov. 17, 2007: Entity Case No. ------ -------- Waco Acquisitions, Inc. 07-15630 A.F.M. 802, Inc. 07-15631 A.F.M. 803, Inc. 07-15632 A.F.M. 804, Inc. 07-15634 A.F.M. 808, Inc. 07-15635 A.F.M. 809, Inc. 07-15636 A.F.M. 811, Inc. 07-15637 A.F.M. 813, Inc. 07-15638 A.F.M. 817, Inc. 07-15639 Debtor-affiliates filing separate Chapter 11 petitions on Nov. 12, 2007: Entity Case No. ------ -------- A.F.M. 805, Inc. 07-15511 A.F.M. 806, Inc. 07-15512 A.F.M. 807, Inc. 07-15513 A.F.M. 810, Inc. 07-15514 A.F.M. 812, Inc. 07-15515 A.F.M. 814, Inc. 07-15516 A.F.M. 815, Inc. 07-15517 A.F.M. 816, Inc. 07-15518 Ohio Valley A.F.M., Inc. 07-15506 Debtor-affiliates filing separate Chapter 11 petitions on Nov. 5, 2007: Entity Case No. ------ -------- Gillespie Acquisition, Inc. 07-15378 Gillespie Wholesale, Inc. 07-15379 A.F.M. 711, Inc. 07-15381 A.F.M. 712, Inc. 07-15383 A.F.M. 713, Inc. 07-15384 A.F.M. 714, Inc. 07-15386 A.F.M. 716, Inc. 07-15388 Jackson Center 717, Inc. 07-15389 A.F.M. 717, Inc. 07-15390 A.F.M. 720, Inc. 07-15392 A.F.M. 721, Inc. 07-15393 A.F.M. 722, Inc. 07-15394 A.F.M. 723, Inc. 07-15396 Type of Business: Petro Acquisitions Inc., operates and franchises 140 AmeriStop gas stations and convenience stores in Ohio, Kentucky and Indiana. The company's wholly owned subsidiary Gillespie Acquisition, Inc. filed for Chapter 11 protection with 13 affiliates on November 5 (Bankr. S.D. Ohio Lead Case No. 07-15378). Waco Acquisitions, Inc., another of Petro's wholly owned subsidiary, filed for bankruptcy with eight affiliates on November 17 (Bankr. S.D. Ohio. Lead Case No. 07-15630). A.F.M. 805, Inc. and eight affiliates, are subsidiaries of Waco Acquisition and filed for Chapter 11 on November 12 (Bankr. S.D. Ohio Lead Case No. 07-15511). Ohio Valley A.F.M., Inc., a subsidiary of OV Acquisition, which in turn is a subsidiary of Waco Acquisition, also filed for bankruptcy of November 12 (Bankr. S.D. Ohio under Case No. 07-15511). The case summaries of the bankruptcy petitions of Petro's subsidiaries was published in the Troubled Company Reporter on Nov. 20, 2007. Petro Ventures, another of Petro Acuiqisition's subsidiary, and 13 affiliates filed for Chapter 11 on Jan. 18, 2008. Petro Ventures is motor fuels wholesaler. The principal businesses of Debtors Mayank Jigar, AFM 29130, Inc., AFM 29134, Inc., AFM 29135, Inc., AFM 801, Inc. and CFM #29063, Inc. are the operation of convenience stores and the retail sale of gasoline. The other entities which filed concurrently with Petro ventures are either engaged in the operation of convenience stores and the retail sale of gasoline; distributors of groceries and related products to the Petro Companies; or were entities established for related business purposes. Chapter 11 Petition Date: November 21, 2007 Court: Southern District of Ohio (Cincinnati) Debtors' Counsel: Ronald E. Gold, Esq. Frost, Brown, Todd L.L.C. 2200 P.N.C. Center 201 East Fifth Street Cincinnati, OH 45202 Tel: (513) 651-6800 Fax: (513) 651-6981 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million PINE RIVER: Court Confirms Chapter 11 Plan of Liquidation --------------------------------------------------------- The Honorable Phillip Shefferly of the U.S. Bankruptcy Court for the Eastern District of Michigan confirmed Pine River Plastics Inc.'s Amended Combined Plan of Liquidation and Disclosure Statement. Plan Overview As reported in the Troubled Company Reporter on Dec. 27, 2007, the Debtor's estate contains minimal assets, other than certain funds held in escrow representing the proceeds of sales of tooling which are subject to litigation regarding the priority of liens to such tooling, and other miscellaneous assets. As a result, the Plan does not provide for a distribution to any creditors other than those holding allowed (i) administrative claims (other than administrative claims pursuant to Section 503(b)(9) of the Bankruptcy Code, who will be paid in full, and (ii) secured claims, who will not be paid in full. All matters relating to claims resolution and avoidance actions, as well as distributions to general unsecured creditors and holders of administrative claims pursuant to Section 503(b)(9) of the Bankruptcy Code have been previously assigned to a liquidation trust, and the Plan provides that the Court will retain jurisdiction over the activities of the liquidation trustee. In the event that assets of the Debtor's estate remain after payment in full to administrative priority and secured creditors, such assets will be conveyed to the liquidation trust, to be distributed pursuant to a liquidation trust agreement. Treatment of Claims Under the Plan, Professional Fees, subject to allowance by the Court after notice and hearing, will be paid in advance and as a carve out by PNC Bank N.A. PNC is a secured lender pursuant to a debtor-in-possession revolving credit and security agreement dated as of Feb. 8, 2007 by and between the Debtor, the DIP lenders, and PNC as agent for the lenders. PNC also agreed to pay legal fees, capped at $15,000, to Jaffe, Raitt, Heuer & Weiss, P.C., counsel for the Official Committee of Unsecured Creditors and the liquidation trustee, for costs incurred in addressing, reviewing and confirmation of the Plan. Any recovery by holders of Prepetition Administrative Claims will be achieved through a liquidation trust, as there are no estate funds to pay such claims. All Allowed Administrative Claims, if any, other than the Prepetition Administrative Claims and the Claims of professionals for Professional Fees, which will not receive payment under the Plan, will be paid on a pro rata basis as soon as funds are available. Holders of Allowed Priority Claims will be paid on, or as soon as funds are available after (a) the later of (i) the effective date of the Plan or (ii) the date the Priority Claim becomes an Allowed Claim, and (b) after full payment of Allowed Administrative Expense Claims and Section III, Class I Allowed Secured Claims. To the extent this class cannot be paid in full, all proceeds distributed to this Class will be distributed pro-rata. No interest will be paid on any Priority Claim. Class I Secured Claims will be paid as soon as funds are available. To the extent that any Allowed Secured Claim is secured by property the value of which is greater than the amount of such Allowed Secured Claim, pursuant to Section 506(b) of the Bankruptcy Code, such Allowed Secured Claim will be entitled to interest from the effective date of the Plan. The Debtor said it does not have assets available to pay all Allowed Secured Claims in full. Allowed Claims of all Unsecured Creditors will not receive any distribution under the Plan. All Allowed Interests in the Debtor will be cancelled upon the effective date of the Plan. About Pine River Based in Saint Clair, Michigan, Pine River Plastics, Inc. -- http://www.prplastics.com/-- manufactures plastic injection moldings. The company filed for Chapter 11 protection Feb. 1, 2007 (Bankr. E.D. Mich. Case No. 07-42051). Brendan G. Best, Esq. and Ronald L. Rose, Esq., at Dykema Gossett PLLC, represent the Debtor in its restructuring efforts. The Debtor have selected Kurtzman Karson Consultants LLC as its claim,notice and balloting agent. The U.S. Trustee for Region 9 has appointed creditors to serve on an Official Committee of Unsecured Creditors in the Debtor's case. Judith Greenstone Miller, Esq., and Jay L. Welford, Esq., Jaffe, Raitt, Heuer and Weiss, represent the Committee. When the Debtor filed for protection from its creditors, it listed estimated assets and liabilities of $1 million to $100 million. QUEBECOR WORLD: Files for Chapter 11 Protection in Manhattan ------------------------------------------------------------ Quebecor World Inc. has filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Southern District of New York after a deal to raise new money failed, Chris Fournier of the Bloomberg News reports. Quebecor World also obtained an order for creditor protection under the Companies' Creditors Arrangement Act in Canada. Under the terms of the order, Ernst & Young Inc. will serve as the monitor under the CCAA process and will assist the company in formulating its restructuring plan. As reported in the Troubled Company Reporter on Jan. 17, 2008, the company had accepted a CDN$400 million rescue financing proposal submitted jointly by Quebecor Inc. and Tricap Partners Ltd., a private equity fund managed by Brookfield Asset Management Inc. The proposal contemplates an interim financing facility of CDN$200 million, which will be made available to the company in accordance with its cash flow needs, subject to receipt or waiver on Jan. 16, 2008. The financing further contemplates that on or prior to March 31, 2008, the CDN$200 million interim facility will be replaced by a recapitalization plan comprised of an aggregate CDN$400 million issuance of Senior Secured Notes due 2012 to Quebecor Inc. and Tricap Partners. As reported in the Troubled Company Reporter on Jan. 18, 2008, Quebecor World said that it was unable to pay the $19.5 million interest due Jan. 15, 2008, on its outstanding $400 million 9.75% Senior Notes due 2015. The publishing company had difficulties trying to raise money after banking institutions further restricted credit terms, which was prompted by U.S. subprime mortgage losses, Bloomberg relates. According to CEO Jacques Mallette, market conditions spurred the company to seek for bankruptcy protection, Bloomberg says. "Under the circumstances, it was probably the best thing for them to do," Bloomberg quotes Jarislowsky Fraser Ltd. partner Denis Durand. In addition, Quebecor World disclosed that in connection with the waivers obtained from its banking syndicate and the sponsors of its securitization program on Dec. 31, 2007, it had not obtained by Jan. 15, 2008, $125 million of new financing, as had been required under the terms of the waivers, the TCR reports. Parent company Quebecor Inc. and subsidiary, Quebecor Media Inc., have not filed for bankruptcy protection. About Quebecor World Inc. Based 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: Case Summary & 57 Largest Unsecured Creditors ------------------------------------------------------------- Lead Debtor: Quebecor World (U.S.A.), Inc. 150 42nd Street New York, NY 10034 Bankruptcy Case No.: 08-10152 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Quebecor World Capital II, L.L.C. 08-10153 Quebecor World Capital Corp. 08-10154 Quebecor World Capital II, G.P. 08-10155 Quebecor Printing Holding Co. 08-10156 Quebecor World Johnson & Hardin Co. 08-10157 Quebecor World Buffalo, Inc. 08-10158 Quebecor World San Jose, Inc. 08-10159 Quebecor World Northeast Graphics, Inc. 08-10160 Quebecor World U.P./Graphics, Inc. 08-10161 Quebecor World Great Western Publishing, 08-10162 Inc. Type of Business: The Debtors provide market solutions, including marketing and advertising activities, and print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. They have around 100 printing and related facilities in North America, Latin America and Asia. In the United States, they have 82 facilities in 30 states, and are engaged in the printing of books, magazines, directories, catalogs and direct mail. In Canada, they have 17 facilities in five provinces, through which they offer a mix of printed products and related value-added services to the Canadian market and internationally. Their primary print services categories are magazines, retail inserts, catalogs, books, directories, direct mail, pre- media, logistics and other related value-added services. See http://www.quebecorworldinc.com/ Chapter 11 Petition Date: January 21, 2008 Court: Southern District of New York (Manhattan) Debtors' Counsel: Anthony D. Boccanfuso, Esq. Arnold & Porter, L.L.P. 399 Park Avenue New York, NY 10022 Tel: (212) 715-1315 Fax: (212) 715-1399 Consolidated Quarterly Financial Condition as of September 2007 Total Assets: $5,554,900,000 Total Debts: $4,140,700,000 Debtors' Consolidated List of 57 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Royal Bank of Canada as revolving credit $735,000,000 Administrative Agent under a facility; value Revolving Credit Facility of security: Attention: Nigel Delph $135,000,000 One Liberty Plaza, 4th Floor New York, NY 10006-1404 Wilmington Trust Co., as notes $450,000,000 Indenture Trustee for 8.75% Senior Notes due in 2016 Attention: Geoffrey J. Lewis Rodney Square North 1100 North Market Street Wilmington, DE 19801 Tel: (302) 636-6438 Fax: (302) 636-4145 notes (as indenture $400,000,000 trustee for 9.75% senior notes due in 2015) notes (as indenture $398,200,000 trustee for 6.125% senior notes due in 2013) notes (as indenture $199,900,000 trustee for 4.875% senior notes due in 2008) Societe Generale (Canada), equipment financing $184,321,796 under an Equipment Financing loan; value of Agreement security: Attention: Benoit Desmarais, $135,000,000 Managing Director Export Finance 1501 McGill College Avenue, Bureau 1800 Montreal (Quebec) H3A 3M8 Tel: (514) 841-6014 Fax: (514) 841-6259 Abitibi Consolidated Sales trade debt $9,256,226 A.R. Department 1228 Paysphere Circle Chicago, IL 60674 Tel: (914) 640-8600 Fax: (914) 640-8900 Cellmark Paper, Inc. trade debt $6,633,295 A.R. Department P.O. Box 7777 Philadelphia, PA 19175-0509 Tel: (203) 363-7820 Fax: (203) 363-7825 Midland Paper trade debt $5,488,174 A.R. Department 6330 West Sunset Road Chicago, IL 60674 Tel: (847) 777-2552 Fax: (847) 777-2551 Bowater, Inc. trade debt $4,082,616 A.R. Department P.O. Box 7 Catawba, SC 29704 Tel: (800) 952-1582 Fax: (803) 282-9562 A.I.G. Credit Corp. of Canada premium financing $3,694,951 Attention: Isabelle Gervais, agreement Branch Manager, Assistant Vice-President 2000 McGill College Avenue, Suite 1200 Montreal, QC H3A 3H3 Canada Tel: (514) 987-2905 Fax: (514) 987-5326 Catalyst Paper, Inc. trade debt $3,339,490 A.R. Department 3600 Lysander Lane, 2nd Floor Richmond, B.C. CA. V7B 1C3 Tel: (604) 247-4400 Fax: (604) 247-0512 The Bank of New York as notes $3,200,000 Indenture Trustee for 6.50% Senior Notes Due in 2027 Attention: Arlene Thelwell Assistant Vice-President Global Trust Services, Americas 101 Barclay Street, 4E New York, NY 10286 Tel: (212) 815-4869 Fax: (212) 815-5008 Graphic Communications trade debt $2,610,161 A.R. Department International Union Local 765 70 Fox Chapel Drive Hudson, OH 44239 Tel: (330) 668-1993 Fax: (330) 650-8999 Norske Skog U.S.A., Inc. trade debt $2,448,176 A.R. Department P.O. Box 8500-52978 Philadelphia, PA 19178-2978 Tel: (203) 254-5292 Fax: (203) 254-5290 Stora Enso North America trade debt $2,408,160 A.R. Department 2386 Collections, Center Drive Chicago, IL 60693-0023 Tel: (800) 888-70STORA Fax: (203) 356-2375 Packaging Corp. of America trade debt $2,214,339 A.R. Department 36596 Treasury Center Chicago, IL 60694-6500 Tel: (334) 749-1788 Fax: (847) 482-4545 U.P.M. Kymmeme, Inc. trade debt $2,016,229 A.R. Department 999 Oakmont Plaza, Suite 200 Westmont, IL 60559 Tel: (630) 850-3310 Fax: (630) 850-3322 Myllykoski North America trade debt $1,904,950 A.R. Department P.O. Box 4235, Station A Toronto, ON, CA M5W 5P7 Tel: (514) 878-1977 Fax: (514) 878-2155 Aaron Direct trade debt $1,795,527 A.R. Department 161 Washington Street, 11th Floor Conshohocken, PA 19428 Tel: (610) 940-0800 Fax: (610) 940-0132 Day International, Inc. trade debt $1,461,126 A.R. Department P.O. Box 643526 Pittsburgh, PA 15264-3526 Tel: (800) 877-8187 Fax: (513) 226-1466 NewPage Corp. trade debt $1,441,655 A.R. Department 23504 Network Place Chicago, IL 60673-1235 Tel: (847) 285-4800 Fax: (847) 285-4846 At Clayton Corp. trade debt $1,376,237 A.R. Department P.O. Box 911405 Dallas, TX 75391-1405 Tel: (203) 861-1190 Fax: (203) 861-1170 Roosevelt Paper Co. trade debt $1,063,058 A.R. Department P.O. Box 790208 St. Louis, MO 63179 Tel: (800) 323-1778 Fax: (708) 771-7979 Horizon Paper Co. trade debt $1,030,897 A.R. Department P.O. Box 10374 Newark, NJ 07193-0374 Tel: (212) 682-5820 Fax: (212) 986-0689 Quebecor World Baird-Ward, pension plan $900,000 Inc. Retirement Plan funding Attention: Helen Levine State Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 Quebecor World Buffalo, Inc. pension plan $990,000 Retirement Plan for Hourly funding Employees Attention: Helen Levine State Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 Quebecor World Kingsport, Inc. pension plan $990,000 Retirement Plan for Hourly funding Bargaining Unit Employees of Kingsport, Hawkins, Sherwood and Distribution Attention: Helen Levine State Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 Quebecor World Mount Morris pension plan $990,000 II, Inc. Employees' Pension funding Plan Attention: Helen Levine State Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 The Pension Plan for Hourly pension plan $990,000 Employees of the Salem Gravure funding Division of Quebecor World (U.S.A.), Inc. Attention: Helen Levine State Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 Quebecor World Pension Plan pension plan $990,000 Attention: Helen Levine State funding Street Bank and Trust Co., N.A. Two World Financial Center 225 Liberty Street New York, NY 10281 Tel: (917) 790-4172 Fax: (917) 786-2096 Milwood, Inc. trade debt $931,984 A.R. Department P.O. Box 960 Vienna, OH 44473-0960 Tel: (330) 359-5220 Fax: (330) 359-5781 Nippon Paper Industries U.S.A. trade debt $899,188 Co. A.R. Department P.O. Box 11626 Tacoma, WA 98411-6626 Tel: (206) 623-1772 Fax: (360) 457-8675 Atmos Energy Marketing, L.L.C. utility debt $897,041 A.R. Department 13430 Northwest Freeway, Suite 700 Houston, TX 77040 Tel: (713) 688-7771 A.E.P. Industries trade debt $872,832 A.R. Department P.O. Box 8500-50590 Philadelphia, PA 19178-8500 Tel: (800) 477-AEPI Fax: (708) 389-3515 Blue Heron Paper Co. trade debt $848,968 A.R. Department 1200 West 7th Street, Suite T2-210 Department 2964 Oregon, OR 97045-1809 Tel: (503) 650-4211 Fax: (503) 650-4595 H.B. Fuller Co. trade debt $834,873 A.R. Department P.O. Box 73515 Chicago, IL 60673-7515 Tel: (888) 351-3521 Fax: (214) 285-8739 Xpedx trade debt $815,551 A.R. Department P.O. Box 32467 Hartford, CT 06150-2467 Tel: (201) 934-5115 Fax: (201) 934-5188 Tembec Enterprises, Inc. trade debt $783,953 A.R. Department 4542 Paysphere Circle Chicago, IL 60674 Tel: (819) 627-8111 Fax: (819) 627-3177 Verso Paper trade debt $757,133 A.R. Department 3630 Park 42 Drive, Suite 160D Cincinnati, OH 45069 Tel: (800) 258-8852 Fax: (888) 293-0958 Oji Paper Canada, Ltd. trade debt $725,518 A.R. Department 1200 West 73rd Avenue, Suite 1100 Port Mellon, BC CA VON 2S0 Tel: (604) 884-5223 Fax: (604) 884-2170 Federal Express trade debt $666,199 A.R. Department P.O. Box 1140, Department A Memphis, TN 38101-1140 Tel: (800) 622-1147 Fax: (901) 395-2000 Rock Tenn Co. trade debt $617,010 A.R. Department P.O. Box 102064 Norcross, GA 30071 Tel: (770) 448-2193 Fax: (678) 291-7666 Stadacona, Inc. trade debt $603,882 A.R. Department 1000 Stewart Avenue Glen Burnie, MD 79443 Tel: (410) 590-8298 Fax: (418) 525-2995 Preprint Logistics Management trade debt $597,628 A.R. Department 105 Filley Street, Unit A Bloomfield, CT 06002 Tel: (800) 596-2335 Fax: (860) 286-9290 Caraustar trade debt $582,410 A.R. Department 3082 Pacific Avenue Austell, GA 30106 Tel: (770) 948-6101 Fax: (770) 732-6209 Forbo Adhesives trade debt $581,447 A.R. Department Station A Toronto, ON CA M5W 4K9 Tel: (919) 433-1300 Fax: (919) 433-1301 Gould Paper Corp. trade debt $532,047 A.R. Department 2148 Paysphere Circle Chicago, IL 60674-2148 Tel: (847) 441-6820 Fax: (847) 490-5376 Goss International Americas trade debt $504,402 A.R. Department Lockbox 835055 Atlanta, GA 30353-5055 Tel: (603) 740-5965 Fax: (603) 940-5970 M.E.G.T.E.C. Systems, Inc. trade debt $495,562 A.R. Department Lockbox 14268 Chicago, IL 60693-4268 Tel: (920) 336-5715 Fax: (920) 337-1534 Georgia Power Co. utility belt $489,781 A.R. Department 241 Ralph McGill Boulevard Northeast Atlanta, GA 30308 Tel: (404) 506-6526 Fax: (404) 506-3771 M.S.C. Industrial Supply Co., trade debt $483,826 Inc. A.R. Department Department Ch 0075 Palatine, IL 60055-0075 Tel: (800) 645-7271 Randstad Staffing Services trade debt $476,637 A.R. Department P.O. Box 2084 Carol Stream, IL 60132-2084 Tel: (877) 922-2468 Applied Industrial trade debt $476,257 A.R. Department 22510 Network Place Chicago, IL 60673-1225 Tel: (216) 426-4000 Fax: (216) 426-4822 Merced Irrigation District utility debt $467,385 A.R. Department Merced Irrigation District 744 West 20th Street Merced, CA 95340 Tel: (209) 722-5761 Fax: (209) 722-6421 Motion Industries, Inc. trade debt $458,562 A.R. Department P.O. Box 404130 Atlanta, GA 30384-4130 Tel: (209) 529-0261 Fax: (209) 529-1812 Hess Corp. utility debt $422,835 A.R. Department 1185 Avenue of the Americas New York, NY 10036 Tel: (212) 997-8500 Fax: (212) 536-8593 Sempra Energy Solutions utility debt $386,623 A.R. Department 101 Ash Street, 9th Floor San Diego, CA 92101 Tel: (619) 696-3100 Fax: (619) 696-3103 Suez Energy Resources utility belt $383,783 A.R. Department Corporate Communications Suez Energy North America, Inc. 1990 Post Oak Boulevard, Suite 1900 Tel: (713) 636-0000 Fax: (713)636-1364 QUEST TRUST: Poor Credit Support Spurs S&P's Ratings Downgrade -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class M-1, M-2, and M-3 asset-backed certificates from Quest Trust 2004-X1 to 'BB' from 'A', to 'CCC' from 'B', and to 'D' from 'CCC', respectively. At the same time, S&P affirmed its 'AAA' rating on class A from the same series. The lowered ratings on classes M-1 and M-2 reflect collateral performance that has eroded available credit support during recent months. Monthly realized losses for this transaction have exceeded excess interest for each of the past 12 months. The failure of excess interest to cover monthly losses has resulted in the complete depletion of overcollateralization. The downgrade of class M-3 reflects the complete erosion of available credit support and the subsequent write-downs for this class. Class M-3 realized $231,978 in losses during the December 2007 remittance period. Cumulative losses for this transaction were 9.69% of the original principal balance, total delinquencies were 27.29% of the current principal balance, and severe delinquencies (90-plus days, foreclosures, and REOs) were 16.65%. The affirmation reflects the 'AAA' financial strength rating of Ambac Assurance Corp., which provides insurance for class A of this transaction. In addition to the guarantee policy issued by Ambac, a combination of subordination, excess spread, and O/C provide credit support for this transaction. The collateral for this series consists of one- to four-family, fixed- and adjustable-rate, first- and junior-lien mortgage loans with terms to maturity of no more than 30 years. Ratings Lowered Quest Trust 2004-X1 Asset-backed certificates Rating ------ Class To From ----- -- ---- M-1 BB A M-2 CCC B M-3 D CCC Rating Affirmed Quest Trust 2004-X1 Asset-backed certificates Class Rating ----- ------ A AAA R-G CROWN: Fitch Lifts Ratings on Completed FITB Merger Deal ------------------------------------------------------------ Fitch Ratings has upgraded and removed from Watch Positive the ratings for R-G Crown Bank, including its long-term Issuer Default Rating to 'AA-' from 'BB-', following the completion of its acquisition by Fifth Third Bancorp (FITB, rated 'AA-/F1+' by Fitch). R-G Crown Bank's ratings are removed from Rating Watch Positive and upgraded to align with those of FITB's bank subsidiaries and withdrawn. Fitch upgrades, removes from Watch Positive, and withdraws these ratings: R-G Crown Bank -- Long-term Issuer Default Rating to 'AA-' from 'BB-'; -- Short-term IDR to 'F1+' from 'B'; -- Individual to 'B' from 'D'; -- Support to '4' from '5'; -- Support Floor to 'B' from 'NR'; -- Long-term Deposits to 'AA' from 'BB'. Fitch placed R-G Crown Bank's ratings on Rating Watch Positive on May 21, 2007, following the announcement by R&G Financial Corporation of the sale of its bank subsidiary, Florida-based R-G Crown Bank to FITB. The transaction was subject to regulatory approval and several closing conditions, including the lifting of R-G Crown Bank's cease and desist order from the OTS. Following the close of the transaction, R-G Crown Bank will be merged into Fifth Third Bank (Michigan) and Fifth Third Bank (Ohio). As a result, the ratings of R-G Crown Bank were aligned with those FITB banking subsidiaries have been withdrawn. RBSGC MORTGAGE: Fitch Affirms 'B' Rating on Class 3-B-5 Certs. -------------------------------------------------------------- Fitch Ratings has taken rating actions on these RBSGC Mortgage Loan Trust pass-through certificates: RBSGC 2007-A -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA+'; -- Class B-2 downgraded to 'AA-' from 'AA'; -- Class B-3 downgraded to 'A-' from 'A'; -- Class B-4 downgraded to 'BB+' from 'BBB'; -- Class B-5 downgraded to 'B' from 'BB'; -- Class B-6 downgraded to 'C/DR4' from 'B'. RBSGC 2007-B Group 1 -- Class 1-A affirmed at 'AAA'; -- Class 1-B-1 affirmed at 'AA+'; -- Class 1-B-2 affirmed at 'AA'; -- Class 1-B-3 downgraded to 'BBB+' from 'A'; -- Class 1-B-4 downgraded to 'BB' from 'BBB'; -- Class 1-B-5 downgraded to 'B' from 'BB'; -- Class 1-B-6 downgraded to 'C/DR4' from 'B'. RBSGC 2007-B Group 2 -- Class 3-A affirmed at 'AAA'; -- Class 3-B-1 affirmed at 'AA'; -- Class 3-B-2 affirmed at 'A'; -- Class 3-B-3 affirmed at 'BBB'; -- Class 3-B-4 affirmed at 'BB'; -- Class 3-B-5 affirmed at 'B'. The affirmations reflect a satisfactory relationship between credit enhancement and future loss expectations and affect approximately $996.8 million of outstanding certificates. The downgrades affect approximately $30.5 million of the outstanding certificates. The negative rating actions reflect deterioration in the relationship between CE and future loss expectations. As of the November 2007 distribution date, approximately 2.82% and 1.63% of the 2007-A and 2007-B Group 1 transactions, respectively, are more than sixty days delinquent with minimal to no losses to date. The transactions are seasoned 10 and eight months for 2007-A and 2007-B, respectively. The pool factors are approximately 90%, 95% and 96% for 2007-A, 2007-B Group 1 and 2007-B Group 2, respectively. The underlying collateral for the transactions consists of conventional first lien, fixed interest rate, one- to four-family, residential first mortgage loans. Wells Fargo Bank, N.A., rated 'RMS1' by Fitch, is the master servicer for all of the above transactions. REGAL ENT: Inks $210MM Merger Deal With Consolidated Theatres ------------------------------------------------------------- Regal Entertainment Group has entered into an agreement to acquire Consolidated Theatres for approximately $210 million in cash. The proposed acquisition will add 28 theatres with 400 screens to Regal's portfolio and enhance Regal's presence in Georgia, Maryland, North Carolina, South Carolina, Tennessee and Virginia. The consummation of the acquisition is subject to customary closing conditions. "We expect the acquisition of Consolidated Theatres to be accretive to cash flows and earnings and are pleased to announce an agreement to purchase these high quality assets," Mike Campbell, chairman & chief executive officer of Regal Entertainment Group stated. "Accretive acquisitions are a key component of our overall business strategy and we look forward to a successful closing and integration of the Consolidated Theatre assets during the first half of 2008." About Regal Entertainment Group Headquarteres in Knoxville, Tennessee, Regal Entertainment Group (NYSE: RGC) -- http://www.regalcinemas.com/ -- is a motion picture exhibitor. The company's theatre circuit, comprising Regal Cinemas, United Artists theatres and Edwards theatres, operates 6,355 screens in 526 locations in 39 states and the district of Columbia. It develops, acquires and operates multi- screen theatres in mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout the United States. On Sept. 15, 2006, the company acquired four theatres with a total of 58 screens from AMC Entertainment Inc. REGAL ENTERTAINMENT: $210 Mil. Deal Won't Affect S&P's Rating ------------------------------------------------------------- Standard & Poor's Rating Services said that Regal Entertainment Group's (BB-/Negative/--) announcement that it has reached an agreement to acquire Consolidated Theatres Mgmt, LLC. for $210 million does not affect the ratings or outlook on the company. Regal Entertainment Group is analyzed on a consolidated basis with its subsidiary, Regal Cinemas Corp. At Sept. 27, 2007, the company had $2 billion in debt and $2.2 billion in capitalized operating lease obligations. The company's cash balance as of Sept. 27, 2007, was $382.7 million and lease-adjusted leverage was 5.6x. RITCHIE MULTI-STRATEGY: Wants Involuntary Petition Dismissed ------------------------------------------------------------ Ritchie Capital Management LLC, which manages domestic hedge fund Ritchie Multi-Strategy Global, LLC, will seek a dismissal of the Chapter 11 petition filed against the company on Dec. 26, 2007, with the United States Bankruptcy Court for the Northern District of Illinois by investors of the hedge fund, claiming that the petitioners, being equity investors, weren't qualified to file the petition, Bill Rochelle of the Bloomberg News reports. Ritchie Capital, Mr. Rochelle relates, wants the Court to direct the petitioners to pay for $5 million damages if the involuntary petition is dismissed. As reported in the Troubled Company Reporter on Dec. 27, 2007, the petitioners are Benchmark Plus Institutional Partners LLC, Benchmark Plus Partners, LLC, and Sterling Low Volatility Fund QP. About Ritchie Capital Headquartered in Lisle, Illinois, Ritchie Capital Management Ltd. - http://www.ritchiecapital.com/-- is a private asset management firm founded in 1997 by former college football linebacker Thane Ritchie. The company has offices in New York and Menlo Park, California. About Ritchie Multi-Strategy Ritchie Multi-Strategy Global LLC is a domestic hedge fund. Three parties -- Benchmark Plus Institutional Partners LLC, Benchmark Plus Partners LLC, and Sterling Low Volatility Fund Q.P. National City Corp. -- filed a Chapter 11 petition against the company on Dec. 26, 2007 (Bankr. N.D. Ill. Case No. 07-24236). Jeff J. Marwil, Esq., at Winston & Stawn LLP, in Chicago, Illinois, represents the petitioners. The three petitioners disclosed around $46 million in claims. SEA CONTAINERS: Wants SC Iberia and YMCL Guarantees Approved ------------------------------------------------------------ Sea Containers Ltd. and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to enter into two Deed of Guarantees in favor its two wholly owned non- debtor subsidiaries, Sea Containers Iberia SA and Yorkshire Marine Containers Ltd., in connection with a potential settlement by SCL and certain of its subsidiaries, of intercompany claims asserted by GE SeaCo SRL and its subsidiaries. Sanjay Bhatnagar, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, relates that many of the GE SeaCo Entities' claims against the Debtors are currently under a pending arbitration proceeding. However, the Parties excluded certain claims from arbitration in an attempt to consensually resolve those claims. The excluded claims consist of more than $90,000,000 in intercompany claims asserted by GE SeaCo out of ordinary course business transactions between the Parties. After extensive negotiations among the Parties, the Official Committee of Unsecured Creditors of Sea Containers Ltd. and the Official Committee of Unsecured Creditors of Sea Containers Services Ltd., reached a stipulation for the resolution of the Intercompany Claims, the terms of which are yet to be finalized. As a condition to their entry into the Stipulation, the directors of SC Iberia and YMCL have required that SCL provide certain guarantees in exchange for releasing their receivable balances against the GE SeaCo Entities, Mr. Bhatnagar discloses. Accordingly, SCL made arrangements to provide postpetition guarantees to SC Iberia and YMCL for the value of their receivables due from the GE SeaCo Entities, amounting to $585,861 for YMCL and $189,858 for SC Iberia. Each Guarantee is payable solely to the extent necessary to fund recoveries of sums owed to creditors of SC Iberia and YMCL, other than the SCL Entities, and only upon the occurrence of the earlier of: -- certain insolvency events with respect to SC Iberia and YMCL; or -- the Debtors' confirmation of a plan of reorganization that includes a final settlement of any of the Intercompany Claims. The Stipulation provides that as of June 30, 2007, the GE SeaCo Entities owe approximately $4,300,000 to SCL and its subsidiaries on account of all Intercompany Claims. The amount would be adjusted based on certain payments made by and between the GE SeaCo Entities and the SCL Parties subsequent to June 30. Pursuant to the Stipulation, after accounting for the post-June 30 payments, the GE SeaCo Entities agree to set aside at least $600,000 in a segregated account as the net balance owing to the SCL Parties. The funds would remain in the segregated account for SCL's benefit, pending resolution of all the GE SeaCo Entities' claims, including those subject to arbitration. In addition, the GE SeaCo Entities would have the ability to offset against the Segregated Account (i) allowed claims in the bankruptcy cases, and (ii) claims that would arise on account of certain avoidance actions against them. The Parties agree that the Stipulation is the full and final settlement of the Intercompany Claims, and upon its consummation, the Parties would exchange mutual releases. Mr. Bhatnagar contends that the Stipulation, if finalized, would maximize value for the bankruptcy estates, and that SCL's grant of the Guarantees is necessary to induce SC Iberia and YMCL to enter into the Stipulation. The Guarantees serve the Debtors' interests in helping to ensure that third-party claims against SC Iberia and YMCL are funded, thus, avoiding the need for the third-party claimants to resort to collection efforts, which may reach back to the bankruptcy estates, Mr. Bhatnagar explains. About Sea Containers Based in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Court gave the Debtors until Feb. 20, 2008 to file a plan of reorganization. (Sea Containers Bankruptcy News, Issue No. 34; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SIERRA TIMESHARE: Moody's Puts Ba2 Final Rating on Class B Notes ---------------------------------------------------------------- Moody's Investors Service announced that on May 25, 2007 it assigned a definitive Ba2 rating to the $18,645,000 7.49% Class B notes issued by Sierra Timeshare 2007-1 Receivables Funding, LLC. SPIRIT AEROSYSTEMS HOLDINGS: Earns $83.6 Million in 2007 3rd Qtr. ----------------------------------------------------------------- Spirit AeroSystems Holdings Inc., the parent company of Spirit AeroSystems Inc., reported net income of $83.6 million for the third quarter ended Sept. 27, 2007, versus net income of $34.0 million in the corresponding period ended Sept. 28, 2006. The company benefited from a lower effective tax rate during the third quarter 2007. Revenue for the quarter increased 17.0% to $967.5 million from $829.7 million, and the company's operating margins rose to 11.0% percent from 9.3% in 2006. "Strong operating performance continues across the company while we execute our key development programs and pursue new business opportunities," said president and chief executive officer Jeff Turner. "Executing our backlog of over twenty-three billion dollars remains our top near-term opportunity to grow profitability and expand operating margins," Turner added. Spirit said that its backlog during the quarter increased from $21.8 billion to $23.5 billion, as combined net orders for 528 aircraft at Boeing and Airbus outpaced their combined deliveries of 208 aircraft. Spirit's backlog is calculated based on contractual prices for products and expected delivery volumes from the published firm order backlogs of both Boeing and Airbus. Cash flow from operations for the third quarter was $42.0 million, despite increases in inventory on the 787 program and other development programs. Investments in capital expenditures totaled $69.0 million in the quarter. Half of the investment in property, plant and equipment supported the start-up of the 787 program. Cash balances at the end of the quarter were $105.4 million, down $22.0 million from the end of the second quarter 2007, reflecting planned investment in Spirit's core business, primarily for the 787 program. Debt balances at the end of the third quarter were $605.3 million, down slightly from second quarter levels. Balance Sheet At Sept. 27, 2007, the company's consolidated balance sheet showed $3.17 billion in total assets, $2.03 billion in total liabilities, and $1.14 billion in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 27, 2007, are available for free at http://researcharchives.com/t/s?2734 About Spirit AeroSystems Headquartered in Wichita, Kansas, Spirit AeroSystems Holdings Inc. (NYSE: SPR) -- http://www.spiritaero.com/-- provides manufacturing and design expertise in a wide range of products and services for aircraft original equipment manufacturers and operators through its subsidiary, Spirit AeroSystems Inc. Spirit manufactures aerostructures for every Boeing commercial aircraft currently in production, including over 70 percent of the airframe content for the Boeing 737. * * * As reported in the Troubled Company Reporter on Jan. 21, 2008, Standard & Poor's Ratings Services revised its outlook on the company's subsidiary, Spirit AeroSystems Inc., to negative from positive. At the same time, Standard & Poor's affirmed its ratings, including the 'BB' corporate credit rating, on the company. SRG 457: Voluntary Chapter 11 Case Summary ------------------------------------------ Debtor: S.R.G. 457, L.L.C. P.O. Box 0582 Saddle River, NJ 07458 Bankruptcy Case No.: 08-10874 Chapter 11 Petition Date: January 18, 2008 Court: District of New Jersey (Newark) Debtor's Counsel: Eric R. Perkins, Esq. Nicolette & Perkins, P.A. 3 University Plaza, Suite 506 Hackensack, NJ 07601 Tel: (201) 488-9080 Estimated Assets: Unknown Estimated Debts: Unknown The Debtor did not file a list of its largest unsecured creditors. STUDENT FINANCE: Ch. 7 Trustee Balks at Claims Totaling $1 Billion ------------------------------------------------------------------ Charles A. Stanziale Jr., the trustee overseeing the Chapter 7 liquidation of Student Finance Corp. opposed a pair of claims totaling almost $1 billion, the American Bankruptcy Institute cites a report from Bankruptcy Law 360. According to the report, Mr. Stanziale explained that MBIA Inc.'s $468 million claim and a $466 million claim filed by Wells Fargo Bank N.A. are already moot, since the Debtor already paid in full the investors who filed those claims. "To the extent MBIA purported to file its claim on behalf of holders of certificates and notes issued by securitization trusts affiliated with the debtor, those certificate and noteholders have now been paid in full as part of the settlement of another, nonbankruptcy litigation," the report quotes Mr. Stanziale in court documents. Mr. Stanziale also said that MBIA did not disclose damages done by the Debtor, if indeed there were any damages, the report relates. About Student Finance Based in New Castle, Delaware, Student Finance Corp., was in the business of originating and acquiring non-guaranteed student loans and tuition installment agreements primarily from truck and driving schools. On Nov. 4, 2002, the Court entered an Order for Relief under Chapter 11 of the Bankruptcy Code. On Sept. 29, 2003, the Court appointed Charles A. Stanziale, Jr., as the chapter 11 trustee. The case was converted to a Chapter 7 liquidation on Nov. 14, 2003 with Mr. Stanziale appointed as the chapter 7 trustee. Fox Rothschild LLP represents Mr. Stanziale. On June 5, 2005, four trucking schools filed an involuntary petition against the company (Bankr. D. Del. Case No. 02-11620). TRIGEM COMPUTER: Representative Files 6th Section 1518(1) Report ---------------------------------------------------------------- Charles D. Axelrod, Esq., at Stutman, Treister & Glatt P.C., in Los Angeles, California, on behalf of Il-Hwan Park, the foreign representative for TriGem Computer, Inc., delivered to the U.S. Bankruptcy Court for the Central District of California a sixth status report pursuant to Section 1518(1) of Chapter 15 of the Bankruptcy Code on January 14, 2008. Mr. Axelrod reports that the Suwon District Court, Bankruptcy Division, in the Republic of Korea, ruled on January 2, 2008, that TriGem's corporate reorganization proceedings in South Korea has been completed pursuant to Article 3 of the Addendum of the Act on Reorganization and Bankruptcy of Debtors and Article 272.1 of the old Act on Corporate Reorganization. As previously reported, parties-in-interest in TriGem's bankruptcy proceeding before the Korea Bankruptcy Court approved on October 4, 2007, by the required votes a final amendment to TriGem's amended plan of reorganization, which incorporated the terms of the Second M&A Tender. The Korea Bankruptcy Court subsequently confirmed TriGem's final amended plan. TriGem's reorganization plan calls for the sale of the company's assets through a merger and acquisition type transaction. Individual shareholders of TriGem have filed an appeal with respect to the Korea Bankruptcy Court's confirmation order. The shareholders were not pleased with the reduction of TriGem's capital as contemplated by the final amended plan, Mr. Axelrod says. Mr. Axelrod says that in December 2007, TriGem settled with the the individual shareholders and they eventually withdrew their appeal. Since no injunctive relief was sought in connection with the individual shareholders' appeal, all actions scheduled to take in the Foreign Proceeding will still occur, except for the issuance of a final decree by the Korea Bankruptcy Court. Pursuant to the amended plan, TriGem would repay its secured debt and liens with KRW122,000,000,000 given by Celrun Co. Ltd. for the acquisition of TriGem. In its January 2 ruling, the Korea Bankruptcy Court stated that from a total secured debt of KRW121,158,275,383 exclusive of debt converted into equity, TriGem repaid KRW112,297,281,791 in two installments on November 9, 2005 and November 16, 2005. The remainder of KRW8,860,993,592 including secured debt has not been repaid yet. As of November 30, 2007, and after TriGem's repayment of approximately 92% of its total secured debt, TriGem estimated assets of KRW201,400,000,000 and estimated liabilities of KRW74,400,000,000. The Korea Bankruptcy Court said that the Receivership Committee of the Suwon District Court confirmed that TriGem's reorganization proceeding will be deemed to be fully completed earlier than the planned schedule and the creditors either agreed or confirmed that they had no opinion on the completion of the reorganization proceeding. The Korea Bankruptcy Court found that TriGem has normalized its financial and business conditions through acquisition by a third party with financial capabilities and it repaid most its secured debt and liens by carrying out its reorganization plan in good faith. Considering the financial structure, corporate governance, recent sales and operational profit records, technological capability and marketing power, and management plan and capability of TriGem and Celrun, the Korea Bankruptcy Court concluded that TriGem will continue to perform its reorganization plan without any problem. Mr. Axelrod also reports that TriGem commenced on December 26, 2007, Adversary Proceeding No. 07-01924 against Toshiba Corporation, David Packard and John E. Hock. In its complaint, TriGem asked the Bankruptcy Court to permanently enjoin the continuation of a prepetition lawsuit commenced by Toshiba, Messrs. Packard and Cock against TriGem in the U.S. District Court for the Central District of California. In the alternative, TriGem requested that the Bankruptcy Court allow its Chapter 15 case to remain open in perpetuity so that the automatic stay will continue and obviate the need to permanently enjoin the continuation of Toshiba, et al.'s litigation. When the adversary proceeding has been concluded, Mr. Park will then address the propriety of closing TriGem's Chapter 15 proceeding, says Mr. Axelrod. A full-text copy of TriGem's status report dated January 14, 2008, is available at no charge at: http://chapter15.com/c15_files/20080116/0021StatusReportNo6.pdf About TriGem Computer Headquartered in Ansan City, Kyunggi-Do, Korea, TriGem Computer Inc. -- http://www.trigem.com/-- manufactures desktop PCs, notebook PCs, LCD monitors, printers, scanners, other computer peripherals, and PIDs and supplies over four million PCs a year to clients all over the world. Il-Hwan Park, the Foreign Representative, filed a chapter 15 petition on Nov. 3, 2005 (Bankr. C.D. Calif. Case No. 05-50052). Charles D. Axelrod, Esq., at Stutman Treister & Glatt, P.C., represents the Foreign Representative in the United States. TriGem America Corporation, an affiliate of the Debtor, filed for chapter 11 protection on June 3, 2005 (Bankr. C.D. Calif. Case No. 05-13972). TriGem Texas, Inc., another affiliate of the Debtor, also filed for chapter 11 protection on June 8, 2005 (Bankr. C.D. Calif. Case No. 05-14047). On Sept. 13, 2007, TriGem filed Draft Plan Amendments in Korea and on September 20 filed a Final Plan Amendment. The Korean Court confirmed Trigem's Amended Plan on Oct. 4, 2007. (TriGem Bankruptcy News, Issue No. 14 Bankruptcy Creditors' Service, Inc., 215/945-7000). WALTERS OIL: Case Summary & 19 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Walthers Oil Company, Inc. 2599 U.S. Highway36 Cuba, KS 66940 Bankruptcy Case No.: 08-10068 Type of Business: The Debtor supplies biodiesel. Chapter 11 Petition Date: January 16, 2008 Court: District of Kansas (Wichita) Judge: Dale L. Somers Debtors' Counsel: Edward J. Nazar, Esq. 245 North Waco, Suite 402 Wichita, KS 67202 Tel: (316) 262-8361 Fax: (316) 263-0610 http://www.redmondnazar.com/ Total Assets: $960,200 Total Debts: $1,368,651 Consolidated Debtors' List of 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Summit Financial collateral: $1,700,000 Resources L.P. $965,710 2455 E. Parleys Way Suite 200 Salt Lake City, UT 84019 Dean Walthers $1,317,000 2500 U.S. Highway 36 Cuba, KS 66940 Commerce Bank collateral: $553,213 P.O. Box 5049 $117,390 Topeka, KS 66605 Fuel Managers collateral: $500,000 $163,000 Shell Oil $500,000 Walthers Inc. $325,000 Pectin Funding collateral: $322,138 $217,430 Marjorie Walthers $286,000 Valero Marketing & Supply collateral: $180,000 $100,000 David D. Walthers $113,905 ConocoPhillips $97,000 Federated Insurance $22,5000 Company Citi-Business $21,429 Bank of America $15,653 Amcon Distributing $13,924 Stuckey's $13,778 Premier $13,543 Capital One $10,814 American Express $9,661 WASHINGTON MUTUAL: Moody's Ratings Unmoved by $1.9 Bil. Losses -------------------------------------------------------------- Moody's Investors Service saw no rating implications to Washington Mutual, Inc's. announcement of a 4Q'07 loss of $1.9 billion. The loss was consistent with an earnings warning that WaMu announced in Dec. 2007. Moody's rates WaMu's lead thrift, Washington Mutual Bank, C- for financial strength and Baa1 for deposits. The holding company's senior debt is rated Baa2. Moody's said that its steep rating downgrades of WaMu in November and December 2007 incorporated WaMu's 4Q07 results. The rating outlook is stable. Moody's said that the downgrades, which included a two-notch downgrade on Dec. 10, 2007, were based on its view that credit losses from WaMu's mortgage operations will be noticeably higher than previously estimated given market deterioration and WaMu's large non-conforming mortgage portfolios. Moody's said that higher provisions are likely to lead to poor results throughout 2008 and 2009. Prior to its rating actions in late 2007, Moody's had expected WaMu's profitability to begin to recover in 2009; however, Moody's now believes this will not occur until 2010. Moody's expects WaMu's loan-loss provisions to be elevated over a two year period given WaMu's: 1) $18.6 billion sub-prime mortgage portfolio, 2) $61 billion home-equity portfolio, of which nearly 74% is second lien, and 3) $57 billion option-adjustable-rate-mortgage portfolio. Moody's said that negative rating pressures would emerge if it felt that the earnings from WaMu's retail and commercial bank, credit card operations and its mortgage servicing activities were not sufficient to more than offset the heightened provisions that WaMu will need to take in the next two years. "Going forward we will be comparing core earnings to provision needs and if we think core earnings will be less than provisions then WaMu's faces capital reduction and possible rating downgrades", said Moody's Senior Vice President Sean Jones. Washington Mutual, Inc is headquartered in Seattle, Washington. Its reported assets as of Dec. 31, 2007 were $328 billion. WCI COMMUNITIES: S&P's CCC Rating Unaffected by Loan Amendments --------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings and outlook on WCI Communities Inc. (WCI; CCC/Negative/--) are not immediately affected by the Florida-based luxury homebuilder's announcement that it has amended the terms governing its $700 million secured revolver and $263 million secured bank loan. S&P acknowledges, however, that the company successfully averted a near-term liquidity event by negotiating a more liberal coverage covenant through June 30, 2009. The company had previously tripped a 0.5x fixed-charge threshold and was operating under temporary covenant waivers. Additional restrictions were relaxed, including carve-outs for FAS 109 deferred tax asset impairments. However, in exchange for the looser covenants, WCI will pay a higher interest rate and the company's borrowing capacity has been reduced. S&P will continue to monitor WCI's efforts to convert its $787 million high-rise tower contract backlog into cash and generate improved orders for single-family homes before S&P considers any changes to the current rating or outlook. WELLS FARGO: Fitch Junks Rating on Class B-5 Certificates --------------------------------------------------------- Fitch Ratings has taken rating actions on these Wells Fargo Alternative Loan Trust pass-through certificates: WFALT 2007-PA1 -- Class A affirmed at 'AAA'; -- Class B-1 affirmed at 'AA'; -- Class B-2 downgraded to 'A-' from 'A'; -- Class B-3 downgraded to 'BB+' from 'BBB'; -- Class B-4 downgraded to 'B' from 'BB'; -- Class B-5 downgraded to 'C/DR5' from 'B'. The affirmations reflect a satisfactory relationship between credit enhancement and future loss expectations and affect approximately $655.3 million of outstanding certificates. The downgrades affect approximately $17.6 million of the outstanding certificates. The negative rating actions reflect deterioration in the relationship between CE and future loss expectations. As of the November 2007 distribution date, approximately 2.47 % of the pool is more than sixty days delinquent with no losses to date. The transaction is seasoned 9 months and the pool factor is approximately 93%. The underlying collateral for the Wells Fargo Asset Securities Corp. transaction consists of conventional, fixed interest rate, monthly pay, fully amortizing, one- to four-family, residential first mortgage loans. All of the mortgage loans were generally originated in conformity with underwriting standards of Wells Fargo Home Mortgage, Inc. Wells Fargo Bank, N.A., rated 'RMS1' by Fitch, is the master servicer for all of the above transactions. XYIENCE INC: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Xyience Incorporated 4572 West Hacienda Las Vegas, NV 89118 Bankruptcy Case No.: 08-10474 Type of Business: The Debtor sells sports nutrition. See: Chapter 11 Petition Date: January 18, 2008 Court: District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtors' Counsel: Laurel E. Davis, Esq. Fennemore Craig, P.C. 300 S. Fourth Street, #1400 Las Vegas, NV 89101 Tel: (702) 692-8000 Fax: (702) 692-8099 http://www.fclaw.com/ Total Assets: $5,285,722 Total Debts: $42,342,831 Consolidated Debtors' List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Zyen LLC assets: value of $12,467,000 c/o Bill Bullard security $5,285,722 2960 W. Sahara Avenue Suite 200 Las Vegas, NV 89102 Darlis Investments assets; value of $8,141,248 c/o Crown Capital Partners security: $5,285,722; 4304-930 Nelson Street value of senior lien: Vancouver, BC Canada $12,467,000 V6Z3A7 Key Management assets; value of $5,191,666 C/o Crown Capital partners security: $5,285,722 4304-938 Nelson Street value of senior lien: Vancouver, BC V6Z3A7 $12,467,000 MTV Networks $3,900,000 Zuffa Marketing LLC $3,000,000 Russel Pike $1,800,011 Prosperity Investments inventory; value of $1,392,877 Alliance & Pacific Investment security: $2,529,007; Network LLC value of security: $25,799,915 Alican West Inc. $576,894 Professional Bull Riders $525,000 Eric Curtis $516,944 Allen Flavors Inc. $514,224 Santoro, Driggs, Walch, $373,665 Kearney, Holley Travel Channel $355,000 Cott Corporation $222,804 Prime Point Media $220,000 WPT Enterprises Inc. $200,000 Jeff Dash $180,000 AJ Robbins P.C. $175,215 MDK Motor Sports LLC $150,000 LA Stars LLC $112,500 * Fitch Cuts Ratings on 28 CLO Tranches and Puts on Neg. Watch -------------------------------------------------------------- Fitch Ratings has downgraded and placed 28 tranches of total rate of return collateralized loan obligations on Rating Watch Negative. Fitch has also placed an additional 37 tranches on Rating Watch Negative. These rating actions are the result of the continued decline in the market value of the underlying loans in the reference portfolios for TRR CLOs. Due to the recent widespread drop in the secondary market values for leveraged loans, these transactions have experienced significant unrealized losses. These TRR CLOs contain market value unwind mechanisms to protect either the swap counterparty or senior noteholders from market value declines beyond a certain threshold. If a combination of realized and unrealized losses in the reference portfolio were to cause the net collateral value to fall below this termination threshold the transaction could be terminated early, thus crystallizing losses to the rated noteholders. The sustained market value decline in the secondary leveraged loan market has increased the vulnerability of these structures to a deteriorating credit environment. For example, from the end of June 2007 through Jan. 16, 2008, the average bid in the overall market fell from $98.74 to $92.49 (a drop of 6.4%) and the average bid on the most liquid leveraged loans, the SMi U.S. 100, fell from $100.02 to $94.36 (a drop of 5.7%) , according to LSTA/LPC Mark-to-Market Pricing data. From a credit perspective, these TRR CLOs in general have performed well. However, Fitch believes that they now have a decreased ability to withstand default stresses, in combination with continued market value stresses. Fitch has downgraded these transactions in addition to placing them on Rating Watch Negative: Aladdin Managed LETTRS Fund, Ltd. -- $43,000,000 class A to 'BB+' from 'A'; -- $22,500,000 class B to 'BB' from 'BBB+'. Beecher Loan Fund, Ltd -- $66,800,000 class A to 'BB+' from 'A'; -- $44,000,000 class B to 'BB' from 'BBB'. Bushnell Loan Fund, Ltd. -- $38,300,000 class A to 'BB+' from 'A'; -- $25,000,000 class B to 'BB' from 'BBB'. Canal Point I, Ltd. -- $33,205,000 class A income notes to 'CCC' from 'BB' (remains on Rating Watch Negative). Canal Point II, Ltd. -- $43,600,000 income notes to 'CCC' from 'BB' (remains on Rating Watch Negative). Fall Creek CLO, Ltd -- $157,500,000 class A-1 revolving notes to 'AA' from 'AAA'; -- $312,500,000 class A-2 to 'AA' from 'AAA'; -- $29,167,000 class B to 'BBB' from 'A'; -- $47,000,000 class C to 'BB' from 'BBB'; -- $2,000,000 class D-1 to 'B' from 'BB'; -- $5,167,000 class D-2 to 'B' from 'BB'. Hartford Leveraged Loan Fund, Ltd -- $125,000,000 income notes and shares to 'BB' from 'BBB'. Malibu Loan Fund, Ltd -- $110,800,000 notes to 'BB' from 'BBB'. Rivendell Loan Fund, LLC -- $28,750,000 class A to 'BB+' from 'A'; -- $18,750,000 class B to 'BB' from 'BBB'. Silver Crest Loan Fund, Ltd. -- $47,800,000 class A to 'BB+' from 'A'; -- $31,300,000 class B to 'BB' from 'BBB'. Stedman Loan Fund, Ltd. -- $57,400,000 class A to 'BB+' from 'A'; -- $38,000,000 class B to 'BB' from 'BBB'. Structured Enhanced Return Vehicle Trust (SERVES) 2006-1, Ltd. -- $157,500,000 class A-1 revolving notes to 'AA' from 'AAA'; -- $312,500,000 class A-2 to 'AA' from 'AAA'; -- $29,167,000 class B to 'BBB' from 'A'; -- $50,000,000 class C to 'BB' from 'BBB'; -- $2,080,000 class D-1 to 'B' from 'BB'; -- $2,087,000 class D-2 to 'B' from 'BB'. Fitch has also placed these transactions on Rating Watch Negative: Bryn Mawr CLO II Ltd. -- $126,000,000 class A-1 revolving notes 'AAA'; -- $250,000,000 class A-2 'AAA'; -- $20,000,000 class B 'AA'; -- $40,223,000 class C 'A'; -- $27,865,000 class D 'BBB'; -- $900,000 class E-1 'BB'; -- $900,000 class E-2 'BB'. Castle Harbor II CLO Ltd. -- $21,000,000 class A 'A'; -- $26,000,000 class B-1 'BBB'; -- $10,000,000 class B-2 'BBB'; -- $3,000,000 class C 'BB-'; -- $8,350,000 combination notes 'BBB'. CELTS 2007-1, Ltd. -- $307,000,000 class A revolving notes 'AA'; -- $57,000,000 class B 'BBB+'. CENT Income Opportunity Fund I, LLC -- $100,000,000 income notes 'BBB'. Coltrane CLO p.l.c. -- EUR 26,000,000 class B 'A'; -- EUR 45,000,000 class C 'BBB'; -- EUR 1,750,000 class D-1 'BB'; -- EUR 2,000,000 class D-2 'BB'. Hudson Canyon Funding, Ltd. -- $47,800,000 class A 'A'; -- $22,000,000 class B-1 'BBB'; -- $9,300,000 class B-2 'BBB'. Invesco Navigator Fund, Ltd. -- $125,000,000 securities 'BBB'. LCM VII, Ltd. -- $126,000,000 class A-1 revolving notes 'AAA' -- $250,000,000 class A-2 'AAA' -- $20,000,000 class B 'AA'; -- $42,763,000 class C 'A'; -- $29,040,000 class D 'BBB' -- $937,000 class E-1 'BB'; -- $937,000 class E-2 'BB'. Loan Funding Corp. 2003-1 -- $25,000,000 class A 'BBB'; -- $12,000,000 class B 'BB'. OCI Enhanced Loan Income Fund, Ltd. -- $50,000,000 income notes 'BBB'. PPM Riviera Loan Fund, Ltd. -- $21,735,000 class A-1 'AA'; -- $11,665,000 class A-2 'A-'; -- $22,000,000 class B 'BBB'. SERVES 2004-1, Ltd. -- $47,500,000 class A 'BBB'. As announced in Fitch's Nov. 7, 2007 release ('Fitch Clarifies Position on New Issue CDO Ratings'), Fitch is currently in the process of reviewing its rating methodology and model assumptions for all new issue CDO ratings. Investors should be aware that Fitch's reassessment of its analytic views could affect existing ratings, including the ratings assigned to the securities in this press release. * Fitch Says Extended Buybacks May Increase M&A for Oil Majors -------------------------------------------------------------- An extended period of share buybacks may increase merger and acquisition risk for global oil majors by creating the need to play catch up through future upstream acquisitions, according to a Fitch Ratings report. Global majors have nearly tripled shareholder-friendly activity from $34 billion in 2002 to $93 billion for the 12-month period to Sept. 30, 2007. Of the two components of shareholder-friendly activity - buybacks and dividends - buybacks have accelerated much faster than dividend increases. While share buybacks are generally viewed as a negative from a bondholder perspective, the effect on credit ratings has been less of a near-term issue given the significant liquidity generated by high commodity prices. Under some circumstances, share buybacks may indirectly benefit bondholders by preventing companies from locking into expensive, and potentially value-destroying long- lived assets, and defend against external demands for more acute actions, such as a recapitalization. However, rerouting cash into shareholder-friendly activities also raises the risk that companies may need to look to larger upstream deals down the road to make up for lost ground in terms of reserve growth. Fitch believes lower reserve growth may increase future pressure on majors to do upstream M&A deals. Fitch notes the ultimate effect of such activity on issuer credit profiles needs to be determined on a case-by-case basis, depending on the deal size and structure, and other variables. * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Shareholders Total Working Equity Assets Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------------ ------ ------- Absolute Software ABT (3) 77 28 AFC Enterprises AFCE (36) 151 (7) Alaska Comm Sys ALSK (28) 557 24 Bare Escentuals BARE (132) 214 76 Blount International BLT (78) 472 140 CableVision System CVC (5,131) 9,807 (630) Carrols Restaurant TAST (13) 463 (29) Centennial Comm CYCL (1,068) 1,332 61 Cheniere Energy CQP (203) 1,962 109 Choice Hotels CHH (149) 338 (31) Cincinnati Bell CBB (671) 1,966 17 Claymont Stell PLTE (40) 158 80 Compass Minerals CMP (48) 722 145 Corel Corp. CRE (20) 249 (19) Crown Holdings I CCK (65) 6,949 440 Crown Media HL CRWN (619) 703 48 CV Therapeutics CVTX (157) 281 204 Cyberonics CYBX (18) 132 (28) Deltek Inc PROJ (144) 148 (12) Denny's Corporation DENN (201) 413 (65) Domino's Pizza DPZ (1,434) 497 82 Dun & Bradstreet DNB (467) 1,419 (262) Einstein Noah Re BAGL (41) 146 0 Entropic Communications ENTR (33) 177 29 Extendicare Real EXE-U (24) 1,277 161 Gencorp Inc. GY (31) 1,082 74 General Motors GM (40,071) 149,500 (1,798) Healthsouth Corp. HLS (1,025) 2,529 (351) IDEARC Inc IAR (8,531) 1,658 391 IMAX Corp IMX (77) 213 0 IMAX Corp IMAX (77) 213 0 Incyte Corp. INCY (141) 283 238 Indevus Pharma IDEV (74) 183 39 Intermune Inc ITMN (13) 292 237 Koppers Holdings KOP (24) 676 186 Life Sciences Re LSR 0 236 7 Linear Tech Corp LLTC (636) 1,334 827 Lodgenet Entertn LNET (18) 709 18 Mediacom Comm MCCC (188) 3,631 (276) National Cinemed NCMI (579) 439 40 Navistar Intl NAVZ (1,699) 10,786 164 Netsuite Inc N (49) 56 (46) Nexstar Broadcasting NXST (87) 708 (19) NPS Pharm Inc NPSP (210) 361 (119) ON Semiconductor ONNN (35) 1,526 395 PRG-Schultz Intl PRGX (29) 115 21 Primedia Inc PRM (129) 282 6 Protection One PONN (13) 675 (287) Radnet Inc. RDNT (53) 434 41 Regal Entertainment RGC (93) 2,594 (41) Riviera Holdings RIV (42) 219 18 RSC Holdings Inc RRR (73) 3,554 (283) Rural Cellular RCCC (595) 1,328 98 Sally Beauty Hol SBH (761) 1,405 354 Sealy Corp. ZZ (128) 1,023 40 Sipex Corp SIPX (18) 44 2 Sonic Corp SONC (107) 759 (41) Spectrum Brands SPC (104) 3,211 779 St. John Knits Inc. SJKI (52) 213 80 Station Casinos STN (291) 3,932 (50) Stelco Inc STE (64) 2,657 693 Town Sports Int. CLUB (6) 483 (71) Voyager Learning VLCY (53) 917 (637) Warner Music Gro WMG (36) 4,572 (687) Weight Watchers WTW (945) 1,037 (134) Western Union WU (146) 5,685 (2,261) WR Grace & Co. GRA (343) 3,794 (1,246) XM Satellite XMSR (724) 1,709 (244) ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, Philline P. Reluya, Joseph Medel C. Martirez, and Peter A. Chapman, Editors. Copyright 2008. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***