T R O U B L E D C O M P A N Y R E P O R T E R Friday, January 25, 2008, Vol. 12, No. 21 Headlines ACXIOM CORP: Earns $54.7 Million in Fiscal 3rd Qtr. Ended Dec. 31 ADAM AIRCRAFT: Needs $30.5 Mil. by Month's End or Will Liquidate ADELPHIA COMMS: Court Extends Claims Objection Deadline to May 16 ALK HOLDINGS: Case Summary & 19 Largest Unsecured Creditors AMERICAN HOME: Fitch Cuts Ratings on Four Certificate Classes AMERICREDIT CORP: Fitch Places 'BB' Ratings Under Negative Watch AMERICREDIT CORP: $19MM Projected Loss Cues Moody's Neg. Outlook AMERICREDIT CORP: S&P Shifts to Negative Outlook; Holds BB- Rating ASARCO LLC: Can Employ ERM as Valuation Project Consultants ASSOCIATED MATERIALS: To Close Ennis, Texas Warehouse Facility ASTRATA GROUP: Nov. 30 Balance Sheet Upside-Down by $10.1 Million AVISTA CORP: Posts $3.9 Million Net Loss in 2007 Third Quarter BRANDYWINE REALTY: Panel OKs Employment Pact With Robert Wiberg BUFFETS INC: Moody's Rating Tumbles to 'D' on Chap. 11 Filing BURLINGTON COAT: Earns $23,173,000 in 2008 Second Quarter CASH TECHNOLOGIES: Nov. 30 Balance Sheet Upside-Down by $4.4 Mil. CHAMPION PARTS: Kevin Cain Resigns as VP Finance and CFO CHARLES WILLIAMS: Case Summary & Four Largest Unsecured Creditors CHASE MORTGAGE: Fitch Downgrades Ratings on 17 Cert. Classes CHRYSLER LLC: Unit Inks Product Development Pact With Tata Motors CIENA CORP: Inks Buyout Deal With World Wide Packets CIENA CORP: WWP Merger Won't Affect S&P's "B" Corporate Rating CITICORP MORTGAGE: Fitch Holds 'B' Ratings on Seven Cert. Classes CITIGROUP MORTGAGE: Fitch Puts 'B' Rated Certs. Under Neg. Watch CITIMORTGAGE ALTERNATIVE: Fitch Junks Ratings on 8 Cert. Classes COMM 2006-C8: Scheduled Amortization Cues Fitch to Hold Ratings COMPASS DIVERSIFIED: Arm Completes Staffmark Investment Buyout CONSTELLATION BRANDS: Selling Three Wine Brands for $134 Million CREDIT SUISSE: Fitch Holds Low-B Ratings on Three Cert. Classes CROWN CITY: Case Summary & 22 Largest Unsecured Creditors CSK AUTO: S&P Cuts $450 Million Term Loan Rating to 'B-' DLJ COMMERCIAL: Fitch Affirms 'BB+' Rating on $22.2MM Certificates DOMAIN HOME: Creditor Paladin Denies Likely Loss Over Bankruptcy FIRST UNION: Fitch Affirms 'B-' Rating on $8.9MM Class M Certs. FLYI INC: To Pay $108 Million to MTTC as Lease Pact Settlement FONIX CORP: Sept. 30 Balance Sheet Upside-Down by $55.20 Million FONIX CORP: Shareholders Elect Three New Directors to Board FORD CREDIT: Fitch Rates $43.8 Million Class D Trust at BB FORD CREDIT: S&P Places BB+ Rating on $43.8 Mil. Class D Notes FOX COLLISION: Seeks Protection Under Chapter 11 in Kansas FOX COLLISION: Case Summary & 19 Largest Unsecured Creditors FRIEDMAN'S INC: Three Jewelers File Involuntary Chapter 7 Petition FRIENDSHIP VILLAGE: Fitch Lowers Rating on $80.5MM Bonds to "BB" GARUDA CAPITAL: Sells All Remaining Assets to Pay Debts GENERAL MOTORS: IUE-CWA Retirees to Get Belated Christmas Bonus GERALD HARTMAN: Case Summary & 16 Largest Unsecured Creditors GRANITE CARTAGE: Case Summary & 17 Largest Unsecured Creditors GS MORTGAGE: S&P Places Four Low-B Ratings Under Negative Watch GS MORTGAGE: Stable Performance Cues Fitch to Affirm Ratings H&H MEAT: Can Hire Campero & Becerra as General Bankruptcy Counsel H&H MEAT: Court Okays Salinas Allen as Accountants H&H MEAT: Section 341(a) Meeting Scheduled for January 29 HARRAH'S ENT: Extends Units' Tender Offer Expiry Until January 28 HARVEY ELECTRONICS: Court Gives Interim Okay to Ruskin as Counsel HEALTHSOUTH CORP: Selling Corporate Campus for $43.5 Mil. Cash HELLER FINANCIAL: Fitch Holds 'B-' Rating on $9.6MM Class M Certs. INDYMAC BANCORP: Business Reasons Cue Moody's to Vacate Ratings INFOUSA INC: Inks Definitive Contract to Acquire Direct Media JACOBS FINANCIAL: Nov. 30 Balance Sheet Upside-Down by $9.0 Mil. JP MORGAN: Stable Performance Cues Fitch to Affirm Ratings L. TERSIGNI: U.S. Trustee Names Hugh Ray as Examiner LB-UBS: Fitch Affirms 'BB-' Rating on $5 Million Certificates LB-UBS COMMERCIAL: Fitch Retains 'CCC' Rating on $8.9 Mil. Certs. LEHMAN BROTHERS: Fitch Cuts Ratings on Three Cert. Classes to BB+ LEHMAN BROS: S&P Downgrades Rating on Class L Certs. to BB MALLAK REALTY: Case Summary & Three Largest Unsecured Creditors MEGA BRANDS: S&P Cuts Corporate Credit Rating to 'B' From 'B+' MERRILL LYNCH: Fitch Cuts Rating on Class H Certs. to 'CCC/DR3' MEZZ CAP: S&P Cuts Class E's Rating Due to Weak Credit Enhancement MORGAN STANLEY: Fitch Holds 'BB+' Rating on $2MM Class N-SDF Cert. MOUNTAIN ADVENTURE: Case Summary & 18 Largest Unsecured Creditors MUSICLAND: Panel Wants Best Buy to Disgorge $145 Mil. in Payments NORDIC VALLEY: Moody's Reviews Ba1 Rating on $600 Million Notes NY RACING: Plan Confirmation Hearing Deferred to February 7 OAKWOOD PROJECT: Case Summary & 20 Largest Unsecured Creditors PANTHER/DCP: In Chapter 11; Gets $30 Million Financing Commitment PATRIOT HEALTH: Court Enters Order of Liquidation PBG AIRCRAFT: Note Redemption Prompts S&P to Withdraw Ratings PETROZUATA FINANCE: S&P Holds "B" Ratings on Two Bonds QUANTUM ENERGY: Nov. 30 Balance Sheet Upside-Down by $1.6 Million QUEBECOR WORLD: Selects Arnold & Porter as Bankruptcy Counsel QUEBECOR WORLD: To Use $750MM DIP Fund to Buy $416MM Receivables QUEBECOR WORLD: Wants Access to RBC's & Soc Gen's Cash Collateral RADNET INC: To Increase Existing Credit Facilities by $110 Mil. RADNET MANAGEMENT: Moody's Retains B2 Corporate Family Rating RIDGEWAY COURT: Moody's Junks Rating on $126 Mil. Notes From A3 RITCHIE (IRELAND): Wants to Increase Borrowing by $1.8MM to $4.5MM RITCHIE MULTI-STRATEGY: Hearing on $5 Mil. Bond Set for February 6 SHORT-TERM ASSET: S&P Cuts Rating on BC 2000-A Certs. to 'D' STANDARD PACIFIC: Liquidity Pressures Cue Fitch to Cut Ratings TAHERA DIAMOND: To Suspend Jericho Mine Operations to Save Cash TELEPACIFIC CORP: Moody's Confirms B3 Corporate Family Rating TRW AUTOMOTIVE: Moody's Affirms 'Ba2' Corporate Family Rating TYCO INT'L: Releases Preliminary Results for First Quarter 2008 UNITED RENTALS: Earns $112 Million in 2007 Third Quarter VESCOR DEVELOPMENT: Trustee Taps Lewis B. Freeman as Accountants VESCOR DEVELOPMENT: Trustee Taps Schwartzer & McPherson as Counsel WACHOVIA AUTO: Moody's Puts Ba3 Prospective Rating on Cl. E Notes WILD WEST: Bank Lenders' Split Decision Frustrates City Officials ZEALOUS TRADING: Nov. 30 Balance Sheet Upside-Down by $76.2 Mil. * Fitch Expects Fair Value Measurement to Go as Accounting Focus * Fitch Says US Water Industry Enters a Large Capital Expenditure * David Neff Joins Perkins Coie from DLA Piper * Mitchell Silberberg & Knupp Launches Subprime Practice Group * ISDA Contradicts Bill Gross' $250BB Global Loss on CDS Forecast * MortgageDaily.com Says 150 Mortgage Operations Collapsed in 2007 * San Diego Experiences Default and Foreclosure Highs in 2007 * BOOK REVIEW: American Commercial Banking: A Histor ********* ACXIOM CORP: Earns $54.7 Million in Fiscal 3rd Qtr. Ended Dec. 31 ----------------------------------------------------------------- Acxiom Corporation disclosed Wednesday financial results for the third quarter of fiscal 2008 ended Dec. 31, 2007. The company reported net earnings of $54.7 million for the third quarter of fiscal 2008, versus net earnings of $24.9 million in the comparable period of fiscal 2007. Revenue for the three-month period was $350.3 million, a decrease of 0.7% from the third quarter of fiscal 2007. Operating income for the quarter was $96.9 million including a $63.5 million net benefit related to gains, losses and other items. This represents an increase of 89.0% compared to the same quarter a year ago. The significant components of the aforementioned $63.5 million net benefit related to gains, losses and other items are: -- a $65.0 million payment received from Silver Lake and ValueAct Capital after the terminations of the firm's agreement to acquire Acxiom -- a $2.6 million gain realized from the sale of the software distribution unit of Acxiom's operations in France -- a $3.0 million payment to retiring company leader Charles Morgan -- $0.3 million in transaction costs related to the Silver Lake/ValueAct transaction -- $0.8 million for ongoing restructuring activities in Europe For the nine-month period ended Dec. 31, 2007, revenue totaled $1.04 billion, up 0.2% from the same period in the prior year. Income from operations for the nine months was $121.4 million compared to $129.5 million a year ago. Net earnings of $53.7 million include the impact of $28.1 million of benefit from unusual items, net of income tax effect, for the nine-month period. "Our revenue and earnings on continuing operations continue to be impacted by the difficulty in the financial services industry, which has resulted in reduced spending by many of our clients," interim company leader Charles D. Morgan said. "With many of our largest clients affected by the downturn, it has had a significant impact on an important sector of our business. As we have discussed previously, due to the decrease in revenue during the first half of our fiscal year, we took measures to reduce expenses. Although these initiatives had a meaningful impact on expenses this quarter, these measures did not fully offset the reduction in revenue in the third quarter. We expect to experience continued reduced spending from some of our clients, especially in the financial services industry." Free cash flow available to equity was $83.9 million for the three months ended Dec. 31, 2007, compared with free cash flow available to equity of $12.6 million for the three months ended Dec. 31, 2006. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $1.62 billion in total assets, $936.2 million in total liabilities, $98.3 million in deferred income taxes, and $587.8 million intotal stockholders' equity. About Acxiom Corp. Headquartered in Little Rock, Arkansas, Acxiom Corporation, (Nasdaq: ACXM) -- http://www.acxiom.com/-- integrates data, services and technology to create and deliver customer and information management solutions for many of the largest, most respected companies in the world. The core components of Acxiom's innovative solutions are Customer Data Integration (CDI) technology, data, database services, IT outsourcing, consulting and analytics, and privacy leadership. Founded in 1969, Acxiom has locations throughout the United States and Europe, and in Australia, China and Canada. * * * As reported in the Troubled Company Reporter on Dec. 17, 2007, Moody's Investors Service confirmed Acxiom's Ba2 corporate family rating and assigned a negative rating outlook, concluding a review for possible downgrade initiated on May 17, 2007, following the company's announcement that it had entered into a definitive agreement to be acquired by Silver Lake and ValueAct Capital for $3 billion. ADAM AIRCRAFT: Needs $30.5 Mil. by Month's End or Will Liquidate ---------------------------------------------------------------- Adam Aircraft Industries must secure two financing transactions otherwise it will be forced to liquidate, Molly McMillin of the Wichita Eagle reports citing a letter by CEO John Wolf to stockholders. Although the company had already secured $5.5 million in December 2007, it needs to obtain $30.5 million by the end of this month. The report adds that according to the letter, the company successfully complete the $30.5 million transaction in order for the company to obtain at least a $100 million equity financing led by Citibank sometime in May 2008. However, if the company is unable to complete its first financing by the end of January, the company could undergo liquidation in order to pay its obligations to its lenders. If this happens, the letter states, stockholders will have little or no recovery for their investments. In addition, the Wichita Eagle relates, the company will also offer parties who invest for the January financing a 49.9% equity interest in a newly formed subsidiary. Adam Aircraft's Press Release Adam Aircraft stated in its Web site that it has been strengthening its operations throughout this past year with significant progress towards obtaining A700 Type Certification and improving production processes through its Make Production Fly (MPF) program. As a result of the company's ongoing evaluation of the processes and resources needed to achieve its vision and milestones, Adam Aircraft is making a revision to the company's overall production plan. "Adam Aircraft Industries is announcing today a strategic adjustment in operations designed to focus on two key objectives: obtain a TC on our A700 jet design and complete our "MPF" initiative," said Adam Aircraft President Duncan Koerbel. "To provide for our future growth, we must be strategic in our focus by managing current cash expenditures to ensure adequate time to secure financing for the long term. We're off to a good start in this effort with assistance from our partner, Citibank, but we need to be able to provide them with sufficient time working with potential investors to secure long term financing." The company said that the necessary strategic adjustment for Adam Aircraft will reduce resources to match the revised production and spending plan resulting in these actions: -- Operations at Ogden will be suspended through early summer and it is rescheduling the completion of the composite lay-up portion of the Ogden facility. -- Transfer of the lay-up and bonding operations for the empennage from Pueblo to Englewood. Machine shop operations will continue in Pueblo, but all other activity will be suspended. -- Reductions in expenses and labor commensurate with the revised production plan. "We regret that these actions will result in a layoff for many of our employees, but it is in the best interest for the long term success of Adam Aircraft Industries. We have two excellent products in the A500 and A700 with a very strong global market and will continue to move the company forward in achieving our goals." With its long term company objectives unchanged, Adam Aircraft said it will ensure that the required engineering, manufacturing, planning, supply chain, tooling and other development resources are available to achieve TC of the A700 in 2008. Furthermore, the MPF effort will also be staffed and supported to make sure the company's goals are met to start full rate production of the A500 in the summer and to be ready to jump start A700 production once it is certified. About Adam Aircraft Adam Aircraft -- http://www.adamaircraft.com/-- designs and manufactures advanced aircraft for civil and government markets. The A500 twin-engine piston aircraft has been Type Certified by the FAA, and the A700, which is currently undergoing flight test and development. ADELPHIA COMMS: Court Extends Claims Objection Deadline to May 16 ----------------------------------------------------------------- At the behest of the reorganized Adelphia Communications Corporation and its debtor-affiliates, the U.S. Bankruptcy Court for the Southern District of New York extended, until May 16, 2008, the period wherein the plan administrator Quest Turnaround Advisors LLC may object to prepetition and administrative claims. Shelley C. Chapman, Esq., at Willkie Farr & Gallagher LLP, in New York, relates that the Reorganized ACOM Debtors have successfully identified and objected to a vast number of unmeritorious claims despite the staggering amount of claims filed against them. As of Dec. 15, 2007, approximately 19,900 claims aggregating $3,980,000,000,000 were asserted against the reorganized ACOM and JV Debtors, Ms. Chapman notes. To date, the Debtors have filed 19 omnibus objections addressing $3,963,000,000,000 of the filed claims, she informs the Court. As a result, roughly $2,910,000,000,000 of the filed claims have been expunged or withdrawn, while others have been reduced and allowed, reclassified, or subordinated. In addition, about $9,400,000,000 in claims have been allowed, reduced and allowed, or expunged as a result of settlements between the reorganized ACOM Debtors and certain claimants. The reorganized ACOM Debtors believe that fewer than 50 claims, totaling $136,000,000, have not been resolved. Notwithstanding the brisk pace of the claims process to date, however, final work on claims resolution remains to be done, according to Ms. Chapman. The Plan Administrator and the reorganized Debtors must conclude the fact-intensive process of reviewing, analyzing and reconciling the scheduled and filed claims, she asserts. The Plan Administrator and the reorganized Debtors relate that the extension of the Claims Objection Deadline will give them additional time to: (a) fully and finally evaluate and reconcile the remaining unresolved claims; and (b) ensure that all unmeritorious claims will be appropriately challenged. The extension will not prejudice any claimant or other party in interest, Ms. Chapman avers. The reorganized ACOM Debtors believe that they will no longer seek for a further extension of the Claims Objection Deadline. About Adelphia Comms Based in Coudersport, Pennsylvania, Adelphia Communications Corporation (OTC: ADELQ) -- http://www.adelphia.com/-- is a cable television company. Adelphia serves customers in 30 states and Puerto Rico, and offers analog and digital video services, Internet access and other advanced services over its broadband networks. The company and its more than 200 affiliates filed for Chapter 11 protection in the Southern District of New York on June 25, 2002. Those cases are jointly administered under case number 02-41729. Willkie Farr & Gallagher represents the Debtors in their restructuring efforts. PricewaterhouseCoopers serves as the Debtors' financial advisor. Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP represent the Official Committee of Unsecured Creditors. Adelphia Cablevision Associates of Radnor, L.P., and 20 of its affiliates, collectively known as Rigas Manged Entities, are entities that were previously held or controlled by members of the Rigas family. In March 2006, the rights and titles to these entities were transferred to certain subsidiaries of Adelphia Cablevision LLC. The RME Debtors filed for chapter 11 protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642). Their cases are jointly administered under Adelphia Communications and its debtor-affiliates' chapter 11 cases. The Bankruptcy Court confirmed the Debtors' Modified Fifth Amended Joint Chapter 11 Plan of Reorganization on Jan. 5, 2007. That plan became effective on Feb. 13, 2007. (Adelphia Bankruptcy News, Issue No. 182; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ALK HOLDINGS: Case Summary & 19 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: ALK Holdings, Inc. dba Acme Lock & Key 4895 South Atlanta Road, Suite C Smyrna, GA 30080 Bankruptcy Case No.: 08-60966 Chapter 11 Petition Date: January 22, 2008 Court: Northern District of Georgia (Atlanta) Judge: Mary Grace Diehl Debtor's Counsel: George M. Geeslin, Esq. Eight Piedmont Center, Suite 550 3525 Piedmont Road, Northeast Atlanta, GA 30305-1565 Tel: (404) 841-3464 Fax: (404) 816-1108 Estimated Assets: $100,000 to $500,000 Estimated Debts: $1 Million to $10 Million Debtor's list of its 19 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ RBC Centura Bank $366,519 134 North Church Street Rocky Mount, NC 27802 Michael & Donna Hassebrock $195,695 960 Ramsden Run Alpharetta, GA 30022 Michael Hassebrock $48,627 960 Ramsden Run Alpharetta, GA 30022 CLN Properties, LLC $30,283 Interstate Locksmith Inc $20,776 Onity Inc $19,099 Chase - Cardmember Service $19,061 Advanta Bank Corp $18,463 Wachovia Bank NA $18,193 Smith, Gambrell & Russell, LLP $17,505 Al & K Liquidation Inc $17,500 Office Team $16,750 Clark Security Products $13,982 Coral Way Locksmith Corp $12,886 Bank of America $9,336 First National Bank $9,305 US Lock Corp $8,826 Georgia Department of Revenue $7,689 Capital One $7,101 AMERICAN HOME: Fitch Cuts Ratings on Four Certificate Classes ------------------------------------------------------------- Fitch Ratings has taken rating actions on these American Home Mortgage Assets Trust residential mortgage-backed certificates: Series 2005-1 Groups 1 & 2 -- Classes 1-A, 2-A affirmed at 'AAA'; -- Class C-B-1 affirmed at 'AA'; -- Class C-B-2 affirmed at 'A'; -- Class C-B-3 affirmed at 'BBB'; -- Class C-B-4 affirmed at 'BB'. Series 2005-1 Group 3 -- Class 3A affirmed at 'AAA'; -- Class 3-M-1 affirmed at 'AA'; -- Class 3-M-2 affirmed at 'A'; -- Class 3-M-3 rated 'BBB', placed on Rating Watch Negative; -- Class 3-M-4 downgraded to 'BB' from 'BBB-', remains on Rating Watch Negative. Series 2005-2 Group 1 -- Class 1-A affirmed at 'AAA'; -- Class 1-B-1 affirmed at 'AA+'; -- Class 1-B-2 affirmed at 'A+'; -- Class 1-B-3 downgraded to 'BB' from 'BBB+', placed on Rating Watch Negative; -- Class 1-B-4 downgraded to 'CC/DR3' from 'BB'; -- Class 1-B-5 downgraded to 'C/DR6' from 'B', removed from Rating Watch Negative. Series 2007-1 -- Class A affirmed at 'AAA'; -- Class M-1 affirmed at 'AA'; -- Class M-2 affirmed at 'AA-'; -- Class M-3 affirmed at 'A+'; -- Class M-4 affirmed at 'A'; -- Class M-5 affirmed at 'A'; -- Class M-6 affirmed at 'A-'; -- Class M-7 affirmed at 'BBB+'; -- Class M-8 affirmed at 'BBB-'. The affirmations reflect credit enhancement consistent with future loss expectations and affect $1.69 billion of outstanding certificates. All affirmed classes detailed above have experienced a growth in CE equal to at least 2 times the CE at closing. The downgrades, affecting $10.5 million of outstanding certificates, reflect the deterioration in the relationship of CE to future loss expectations. The classes placed on Rating Watch Negative represent approximately $10.4 million of outstanding certificates. The pools are seasoned between 11 (series 2007-1) and 26 months (series 2005-1). The pool factors (current mortgage principal balance as a percentage of original) range from 24% (series 2005-2 Group 1) to 90% (series 2007-1). The loans are being serviced by American Home Mortgage Servicing Inc. (rated 'RPS3-' by Fitch). For series 2005-1, Group 3, the amount of loans with serious delinquencies is 19.9% of the outstanding pool balance while the CE for the affected 3-M-3 and 3-M-4 bonds is 4.29% and 2.86%, respectively. The transaction has experienced 0.19% of loss to date and Fitch anticipates that the high delinquencies will translate into even greater losses, further reducing the CE of the subordinate classes. For series 2005-2, the amount of loans with serious delinquencies is 32.14% of the outstanding pool balance while the CE for the affected 1-B-3, 1-B-4 and 1-B-5 bonds is 5.02%, 2.42% and 0.34%, respectively. The transaction has experienced 0.26% of loss to date and Fitch anticipates that the high delinquencies will translate into even greater losses, further reducing the CE of the subordinate classes. AMERICREDIT CORP: Fitch Places 'BB' Ratings Under Negative Watch ---------------------------------------------------------------- Fitch Ratings has placed the ratings of AmeriCredit Corp. on Rating Watch Negative. Approximately $950 million of debt is affected by this action. Fitch has placed these on Rating Watch Negative: AmeriCredit Corp. -- Long-term Issuer Default Rating 'BB'; -- Senior debt 'BB'. The revision of ACF's Positive Outlook reflects deterioration in portfolio asset quality and profitability metrics and the uncertain capital markets environment. While Fitch anticipated that credit metrics would deteriorate from recent levels due to credit normalization, the weakening economy and noticeable geographic weakness has had a more immediate impact on delinquency, loss, and recovery levels. While Fitch expects some near-term stabilization in these metrics, a reduction in origination volume will have a denominator impact, and could inflate current metrics for calendar year 2008. Profitability metrics have benefited from lower credit losses and improved operating leverage in recent years, but near-term profitability will be negatively affected by increased provisioning expense, slower origination volume, and higher funding costs. The Rating Watch Negative reflects the uncertain capital markets environment and ACF's reliance on asset-backed securitizations for funding. ACF has primarily used bond insurers to wrap its securitizations, but dislocations in the bond insurance markets may diminish investor appetite, at least, over the near term. The resolution of the Rating Watch will be dependent upon the company's ability to access the securitization markets and achieve its fiscal 2008 asset quality and profitability expectations. On a positive note, Fitch believes ACF's liquidity profile is sound relative to its current ratings. The company had $567 million in unrestricted cash and equivalents as of Dec. 31, 2007, and approximately $2.9 billion in unused warehouse capacity, which is enough to fund planned origination volume for the remainder of fiscal 2008. AMERICREDIT CORP: $19MM Projected Loss Cues Moody's Neg. Outlook ---------------------------------------------------------------- Moody's Investors Service affirmed AmeriCredit Corp.'s ratings (Corporate Family Rating Ba2, senior unsecured debt Ba3) but revised the firm's rating outlook to negative from stable. The change in outlook is in conjunction with AmeriCredit's announcement that it will post a net loss of $19 million for the second fiscal quarter ended 31 December 2007. The change in outlook reflects the more challenging operating environment being faced by AmeriCredit, as well as other auto and consumer finance companies in the U.S. In particular, the negative outlook considers the effects of deteriorated credit performance in AmeriCredit's core subprime and near prime receivables portfolios (the near prime portfolio being accounted for by the Long Beach Acceptance Corp. business, acquired by AmeriCredit in January 2007). In its fiscal second quarter ended Dec. 31, 2007, AmeriCredit recorded substantial increases in loan loss provisioning and loan loss reserves as a consequence of higher credit loss rates. To date, credit deterioration has been most evident in those regions facing pronounced weakening in economic fundamentals, including Florida, southern California, and sections of the Northeast. Moody's is concerned that downside risks to AmeriCredit's asset quality are increasing and could result in further pressure on the firm's profitability. The negative outlook also incorporates Moody's view that AmeriCredit is likely to face more challenging funding conditions in coming quarters, including the potential for decreased capacity from monoline insurers. This has potential ramifications for AmeriCredit's access - and cost of access - to the term ABS market, which historically has been a key funding source for the company. AmeriCredit is responding to these emerging challenges by significantly curbing new loan originations, tightening underwriting criteria, reducing operating expenses via staff reductions primarily in the sales and originations functions (with a related restructuring charge of approximately $10 million pre-tax to be taken over the next two quarters), and entering into a funding arrangement with monoline insurer FSA for up to $4.5 billion in capacity for calendar 2008. AmeriCredit is better positioned to contend with normal down cycle pressures than in the past, but the combination of significant debt market disruptions and spreading economic weakness results in heightened uncertainty regarding the firm's financial performance and condition over the intermediate term, in Moody's view. Moody's will continue to evaluate the effects of the more adverse market conditions on AmeriCredit's financial profile, in particular the effects on the company's liquidity and funding, asset quality, core profitability, returns, and capital levels. Moody's will also monitor potential implications for corporate governance of Leucadia National's recent acquisition of an equity stake in AmeriCredit. AmeriCredit's current ratings are: -- Corporate Family Rating Ba2; -- Senior Unsecured Ba3 AmeriCredit is a leading independent automobile finance company based in Fort Worth, Texas. As of Dec. 31, 2007 the company reported total managed receivables of $16.35 billion. AMERICREDIT CORP: S&P Shifts to Negative Outlook; Holds BB- Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on AmeriCredit Corp. to negative from stable. At the same time, Standard & Poor's affirmed its 'BB-' long-term counterparty credit rating on AmeriCredit. "The negative outlook reflects AmeriCredit's diminished earnings prospects going forward in light of higher credit and funding costs and lower recovery rates," said Standard & Poor's credit analyst Rian Pressman. "In response to these trends, management intends to slow originations (which will also contribute to lower earnings) by tightening credit, reducing the number of dealers it does business with, and reducing its sales force." The impact of rising unemployment and financial distress, especially in certain regions within AmeriCredit's footprint, contributed meaningfully to higher than expected net credit losses and delinquencies within its subprime and near-prime portfolios. The higher provisions associated with this trend drove a net loss of $19.1 million in AmeriCredit's second fiscal quarter of 2008 (ended Dec. 31, 2007). Given economic trends and the industry-wide expansion of credit risk, S&P expects losses to continue to accelerate, although the trend may be softened in coming quarters by normal seasonal trends. Upfront capital required in securitization transactions will also increase, as the level of initial credit enhancement required by FSA Insurance Co. (a bond insurer with whom AmeriCredit has entered into an uncommitted arrangement to wrap $4.5 billion in subprime securitizations) increases to the mid- teens. Funding costs will also be affected by higher insurance premiums and wider credit spreads. (Continued reduction in the base lending rate driven by Federal Reserve action will offset credit spread expansion to a certain extent.) Lastly, recovery rates were lower than expected in the second fiscal quarter. S&P expects pressure on recovery rates to continue into 2008 as reduced consumer demand for vehicles translates into lower prices received by sellers at auction. Standard & Poor's could lower the ratings if the confluence of events described above drives continued quarterly losses (some allowance will be given to the restructuring charges that AmeriCredit is expected to incur) or if earnings fail to stabilize at a satisfactory level. However, the magnitude of such a downgrade may be blunted by AmeriCredit's improved business profile as a full-spectrum lender, satisfactory liquidity position, and, possibly, improved competitive position given pending and expected dislocation within the market for subprime automotive lending. ASARCO LLC: Can Employ ERM as Valuation Project Consultants ----------------------------------------------------------- ASARCO LLC and its debtor-affiliates obtained permission from the U.S. Bankruptcy Court for the Southern District of Texas to employ Environmental Resources Management Southwest Inc. as consultant concerning the Debtors' valuation project of the company owned, non-operating real property sites. The Valuation Project mainly consists of: (a) an evaluation of environmental conditions at ASARCO's properties; (b) a review and estimation of potential environmental liabilities and remediation costs of the properties; (c) a comprehensive evaluation to develop environmental liability cost estimates for some of the properties; and (d) a review of the basis for and reasonableness of current estimates developed by ASARCO of anticipated environmental liability costs for some properties. The Valuation Project will be in furtherance of Baker Botts' representation as ASARCO's lead bankruptcy counsel, and in anticipation of litigation and proceedings related to the company's properties. For the Valuation Project, ASARCO will pay ERM its customary hourly rates of $65 to $375 for scientists, engineers and other professionals and senior consultants, and $20 to $100 for other staff and employees. ASARCO will also reimburse ERM for any necessary out-of-pocket expenses. Barrett Cieutat, president of ERM, assures the Court that his firm does not represent any interest adverse to ASARCO or its estates, and is a "disinterested person" as the term is defined in Section 101(14). About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Debtors' exclusive period to file a plan expires on Feb. 11, 2008. (ASARCO Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASSOCIATED MATERIALS: To Close Ennis, Texas Warehouse Facility -------------------------------------------------------------- Associated Materials LLC disclosed in a regulatory filing with the Securities and Exchange Commission that on Jan. 18, 2008, it committed to a plan to discontinue use of the warehouse facility adjacent to its Ennis, Texas vinyl manufacturing facility. In addition, the company committed to relocating certain vinyl siding production from Ennis, Texas to its vinyl manufacturing facilities in West Salem, Ohio and Burlington, Ontario. The warehouse that is adjacent to the Ennis, Texas manufacturing facility was built during 2005 and is currently leased by the company. In the first quarter of 2008, the company will begin using a third party distribution center located in Ashtabula, Ohio to distribute its vinyl siding and certain other products to the majority of its United States supply centers and to certain independent distributors. The company expects the transition of distribution operations to the third party distribution center and the relocation of certain vinyl siding production will be completed by the end of its fiscal 2008 second quarter. The company expects to incur cash lease costs, net of anticipated sublease income associated with the discontinued use of the warehouse adjacent to the Ennis, Texas vinyl manufacturing facility of approximately $4.0 million and cash moving costs associated with relocating certain production equipment of approximately $0.7 million. In addition, the company anticipates incurring non-cash asset impairment costs related to inventory and fixed assets, however at this time, the company is unable to estimate the extent of these costs. The company expects to complete the estimate of these costs by the end its fiscal 2008 first quarter. About Associated Materials Headquartered in Cuyahoga Falls, Ohio, Associated Materials Incorporated -- http://www.associatedmaterials.com/-- is a manufacturer of exterior residential building products, which are distributed through company-owned distribution centers and independent distributors across North America. AMI produces a broad range of vinyl windows, vinyl siding, aluminum trim coil, aluminum and steel siding and accessories, as well as vinyl fencing and railing. AMI is a privately held, wholly-owned subsidiary of Associated Materials Holdings Inc., which is a wholly-owned subsidiary of AMH, which is a wholly-owned subsidiary of AMH II, which is controlled by affiliates of Investcorp S.A. and Harvest Partners Inc. * * * Associated Materials still carries Moody's Investors Service 'Ba3' Bank Loan Debt and 'B3' Subordinated Debt ratings which were placed on Sept. 22, 2006. Outlook is stable. ASTRATA GROUP: Nov. 30 Balance Sheet Upside-Down by $10.1 Million ----------------------------------------------------------------- Astrata Group Inc.'s consolidated balance sheet at Nov. 30, 2007, showed $4.7 million in total assets, $14.8 million in total liabilities, and $40,114 in minority interest, resulting in a $10.1 million total stockholders' deficit. At Nov. 30, 2007, the company's consolidated balance sheet also showed strained liquidity with $3.3 million in total current assets available to pay $14.8 million in total current liabilities. The company reported a net loss of $1.1 million on net sales of $4.7 million for the third quarter ended Nov. 30, 2007, compared with a net loss of $6.3 million on net sales of $758,035 in the corresponding period ended Nov. 30, 2006. On April 10, 2007, the company's Singapore subsidiary entered into a fixed-price contract with a Singapore entity to manufacture, ship and service approximately $93.5 million of its Telematics products. This contract is accounted for under the percentage-of- completion method. Operating loss was $313,491 million for the three months ended Nov. 30, 2007, compared with an operating loss of approximately $1.9 million for the three months ended Nov. 30, 2006. This is primarily due to the reduction of operating expenses and the performance against the contract awarded April 10, 2007. Interest expense was $749,300 for the three months ended Nov. 30, 2007, and $1.5 million in 2006. The fair value adjustment for a warrant liability was a benefit of approximately $1.5 million and offset by a loss on debt extinguishment of approximately $4.4 million for the three months ended Nov. 30, 2006. Full-text copies of the company's consolidated financial statements for the quarter ended Nov. 30, 2007, are available for free at http://researcharchives.com/t/s?274e Going Concern Doubt Squar, Milner, Peterson, Miranda & Williamson LLP, in Newport Beach, Calif., expressed substantial doubt about Astrata Group Inc.'s ability to continue as a going concern after auditing the company's financial statements for the year ended Feb. 28, 2007. The auditing firm noted that the company had negative working capital at Feb. 28, 2007, and incurred net loss and negative operating cash flow for the year ended Feb. 28, 2007. About Astrata Group Headquartered in Costa Mesa, Calif., Astrata Group Inc. (OTC BB: ATTG.OB) -- http://www.astratagroup.com/-- is engaged in the telematics and Global Positioning System industry, focused on advanced location-based IT products and services that combine positioning, wireless communications, and information technologies. The company provides advanced positioning products, as well as monitoring and airtime services to industrial, commercial, governmental entities, academic/research institutions, and professional customers in a number of markets including surveying, utility, construction, homeland security, military, intelligence, mining, agriculture, marine, public safety, and transportation. AVISTA CORP: Posts $3.9 Million Net Loss in 2007 Third Quarter -------------------------------------------------------------- Avista Corp. reported a net loss of $3.9 million on total operating revenues of $267.7 million for the third quarter ended Sept. 30, 2007, as compared to net income of $10.1 million on total operating revenues of $293.0 million for the third quarter of 2006. Utility revenues increased $14.5 million to $243.8 million primarily as a result of an increase in natural gas revenues of $14.2 million due to increased wholesale (primarily due to increased volumes) and retail (due to an increase in rates and sales volumes) natural gas sales. This was also partially due to increased electric revenues of approximately $300,000 reflecting increased electric retail sales, partially offset by decreased sales of fuel and electric wholesale revenues. Non-utility energy marketing and trading revenues decreased $41.4 million due to the sale of substantially all of Avista Energy's contracts and ongoing operations. Other non-utility revenues increased $1.6 million to $17.6 million as a result of increased revenues from Advantage IQ of $1.8 million primarily due to customer growth, as well as an increase in interest earnings on funds held for customers. This was partially offset by decreased other revenues of approximately $200,000 primarily due to decreased sales at AM&D. On Oct. 30, 2007, Avista Corp. reached an all-party settlement that resolves all issues in its general rate case that was filed with the Washington Utilities and Transportation Commission in April 2007. The settlement is subject to final approval by the WUTC. "Overall, we are very pleased with the settlement. This should allow for significant improvement in our results for 2008 as compared to 2007," said Avista chairman and chief executive officer Gary G. Ely. "The third quarter is generally the lowest earnings quarter for our utility due to seasonally low hydroelectric generation and absorption of higher power supply costs, as well as low natural gas loads. Results for the third quarter of 2007 for our utility were lower than expected primarily due to the disallowance of debt repurchase costs in our Washington general rate case settlement and the write-down of a turbine," said Ely. For the nine months ended Sept. 30, 2007, Avista Corp.'s net income was $24.4 million, a decrease compared to net income of $55.1 million for the nine months ended Sept. 30, 2006. Liquidity and Capital Resources The company has a committed line of credit in the total amount of $320.0 million with an expiration date of April 2011. There were not any borrowings outstanding under the committed line of credit at Sept. 30, 2007. The company has long-term debt maturities of $14.0 million in the fourth quarter of 2007 and $318.0 million in 2008. While the $169.0 million of proceeds from the sale (completed June 30, 2007) of substantially all of Avista Energy's contracts and ongoing operations to Coral Energy should reduce the company's funding needs, the company's forecasts indicate that it will need to issue new debt securities to fund a portion of these requirements in 2008. Balance Sheet At Sept. 30, 2007, the company's consolidated balance sheet showed $3.16 billion in total assets, $2.25 billion in total liabilities, and $912.9 million in total stockholders' equity. The company's consolidated balance sheet at Sept. 30, 2007, also showed strained liquidity with $362.2 million in total current assets available to pay $631.0 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2755 About Avista Corp. Headquartered in Spokane, Washington, Avista Corp. (NYSE: AVA) -- http://www.avistacorp.com/-- is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. Avista Utilities is the company's operating division that provides service to 348,000 electric and 305,000 natural gas customers in three Western states. Avista's primary, non-regulated subsidiary is Advantage IQ. * * * As reported in the Troubled Company Reporter on Dec. 26, 2007, Moody's Investors Service upgraded all of the debt ratings of Avista Corp., including the company's preferred stock shelf to (P) Ba2 from (P)Ba3. The rating outlook for Avista is stable. BRANDYWINE REALTY: Panel OKs Employment Pact With Robert Wiberg --------------------------------------------------------------- Brandywine Realty Trust disclosed in a regulatory filing with the Securities and Exchange Commission that on Jan. 15, 2008, the Compensation Committee of the company's Board of Trustees approved the entry into an employment letter agreement by the company with one of its executive officers, Robert K. Wiberg, which agreement maintains his current annual base salary of $270,000. The employment letter agreement replaces Mr. Wiberg's previous employment agreement dated Nov. 1, 2005, which expired on Jan. 5, 2008. The employment letter agreement provides for, among other things, that the effective date of the employment letter agreement will be Jan. 6, 2008. The company also disclosed that the Compensation Committee approved its entry into another agreement with Mr. Wiberg, which provides Mr. Wiberg with an entitlement to severance in certain limited circumstances. Under the severance agreement, if Mr. Wiberg's employment terminates within a specified period of time following the date that the company undergoes a "change in control", such period being 730 days from the date of the change of control, then Mr. Wiberg will be entitled to a severance payment in an amount based on a multiple of 2.0 times his salary and annual cash bonus. The severance agreement also provides for a comparable payment to or for the benefit of Mr. Wiberg (or his estate) if he dies or becomes disabled while employed by the company. About Brandywine Headquartered in Radnor, Pennsylvania, Brandywine Realty Trust (NYSE: BDN), http://www.brandywinerealty.com/-- is one of the full-service, integrated real estate companies in the United States and is focused primarily on the ownership, management and development of class A, suburban and urban office buildings in selected markets aggregating approximately 42 million square feet. * * * Fitch and Moody's each assigned a 'BB+' rating on Brandywine Realty Trust's Preferred Stock. The ratings still hold to date with positive and stable outlooks respectively. BUFFETS INC: Moody's Rating Tumbles to 'D' on Chap. 11 Filing ------------------------------------------------------------- Moody's Investors Service lowered the Probability of Default Rating of Buffets, Inc. to D. In addition, Moody's lowered the company's corporate family rating to Ca from Caa3, senior secured bank credit facilities rating to Ca from Caa2, and senior unsecured notes to C from Ca. The outlook is stable. The rating actions were prompted by the recent announcement that the company and all of its subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The ratings also reflects Moody's opinion that losses to creditors in the various debt classes could be significant - in particularly unsecured noteholders - based on a distressed multiple of expected operating performance. Subsequent to Buffet's Chapter 11 filing, Moody's will withdraw all of the company's ratings. These ratings were downgraded: Buffets, Inc. -- Corporate family rating to Ca from Caa3 -- Probability of default rating to D from Caa3 -- $40 million revolving credit facility to Ca (LGD3, 47%) from Caa2 (LGD2, 29%) -- $70 million synthetic letter of credit facility to Ca (LGD3, 47%) from Caa2 (LGD2, 29%) -- $530 million term loan B to Ca (LGD3, 47%) from Caa2 (LGD2, 29%) -- $300 million senior unsecured notes to C (LGD6, 91%) from Ca (LGD4, 69%) The ratings outlook is stable. Buffets, Inc., headquartered in Eagan, Minnesota, operates and franchises steak-buffet style restaurants principally under the "Old Country Buffet", "Hometown Buffet" brand names and grill/buffet format restaurants under the brand names "Ryan's" and "Fire Mountain". The company is the second largest family dining restaurant in the industry, operating 626 restaurants in 39 states. Total reported revenues as of Sept. 19, 2007 were approximately $1.55 billion. BURLINGTON COAT: Earns $23,173,000 in 2008 Second Quarter --------------------------------------------------------- Burlington Coat Factory Investments Holdings Inc. and its operating subsidiaries announced results of their fiscal 2008 second quarter ended Dec. 1, 2007. For the three months ended Dec. 1, 2007, net sales decreased by 3.9% to $946.6 million compared with $984.7 million for the three months ended Dec. 2, 2006. Comparative store sales decreased 8.0% during the three month period ended Dec. 1, 2007. The decrease in comparative store sales is primarily attributed to unseasonably warm weather in September and October and weakened consumer demand for the three month period ended Dec. 1, 2007. For the three month period ended Dec. 1, 2007, net income amounted to $23.2 million compared with $11.7 million during the three month period ended Dec. 2, 2006. The increase in net income is primarily attributable to improved markup on new purchases and decreases in depreciation expense, selling and administrative expense and interest expense offset in part by lower other revenue income and an increase in impairment charges for the three month period ended Dec. 1, 2007. Consolidated net sales decreased $16.3 million (1.0%) to $1,625.3 million for the six month period ended Dec. 1, 2007 compared with the six month period ended Dec. 2, 2006. Comparative stores sales decreased 5.6% for the six month period ended Dec. 1, 2007 due primarily to unseasonably warm weather during September and October, the impact of the implementation of the company's cash-back merchandise return policy after the close of the first fiscal quarter of fiscal 2007, and weakened consumer demand throughout the six months ended Dec. 1, 2007. Net Loss amounted to $27.2 million for the six month period ended Dec. 1, 2007 compared with a net loss of $40.1 million for the comparative period of last year. The decrease in net loss of $12.9 million is due primarily to improved markup on new purchases and decreases in depreciation expense, selling and administrative expense and interest expense, offset in part by lower other revenue income and an increase in impairment charges for the six month period ended Dec. 1, 2007. During the first six months of fiscal 2008, the company opened 15 Burlington Coat Factory Stores and relocated three Burlington Coat Factory Stores to locations within the same trading market. As of Dec. 1, 2007, the company operated 394 stores under the names "Burlington Coat Factory Warehouse" (374 stores), "Cohoes Fashions"(2 stores), "MJM Designer Shoes" (17 stores), and "Super Baby Depot" (1 store). The company plans to open five Burlington Coat Factory Warehouse Stores during the remainder of fiscal 2008. The company's balance sheet at Dec. 1, 2007 showed total assets of $3,199,648,000, total liabilities of $2,856,180,000, and total shareholders' equity of $343,468,000. A full-text copy of the company's quarterly report is available for free at: http://researcharchives.com/t/s?2759 About Burlington Coat Factory Headquartered in Burlington, New Jersey, Burlington Coat Factory Investments Holdings Inc. holds all of the stock of Burlington Coat Factory Warehouse Corporation. Burlington Coat Factory Warehouse Corporation is a nationwide off-price apparel retailer that operates approximately 384 stores in 44 states under the nameplates of Burlington Coat Factory, Cohoes, MJM, and Baby Depot. Revenues for the LTM period ended Sept. 1, 2007 were approximately $3.4 billion. * * * As reported in the Troubled Company Reporter on Dec. 26, 2007, Moody's Investors Service changed Burlington Coat Factory Warehouse, Inc.'s rating outlook to negative from stable and affirmed all the company's existing ratings. The change in outlook to negative is as a result of the company's weak revenue and earnings performance that has led to a weakening in credit metrics. The affirmed ratings include the company's "B2" probability of default and corporate family ratings. CASH TECHNOLOGIES: Nov. 30 Balance Sheet Upside-Down by $4.4 Mil. ----------------------------------------------------------------- Cash Technologies Inc.'s consolidated balance sheet at Nov. 30, 2007, showed $6.4 million in total assets, $10.9 million in total liabilities, and ($111,479) in minority interest, resulting in a $4.4 million total stockholders' deficit. At Nov. 30, 2007, the company's consolidated balance sheet also showed strained liquidity with $1.2 million in total current assets available to pay $9.5 million in total current liabilities. The company reported a net loss of $152,793 on net revenues of $35,348 for the second quarter ended Nov. 30, 2007, compared with a net loss of $312,472 on net revenues of $81,782 in the corresponding period ended Nov. 30, 2006. The decrease in net revenue is attributable primarily to a decrease in sales of Air Force data processing by the company's Claim-Remedi Services Inc. subsidiary. Full-text copies of the company's consolidated financial statements for the quarter ended Nov. 30, 2007, are available for free at http://researcharchives.com/t/s?274d Going Concern Doubt As reported in the Troubled Company Reporter on Sept. 17, 2007, Vasquez & Company LLP expressed substantial doubt about Cash Technologies Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended May 31, 2007. The auditing firm noted that the company has suffered significant recurring losses and is in immediate need of substantial working capital to continue its business and operations. About Cash Technologies Headquartered in Los Angeles, Cash Technologies Inc. (AMEX: TQ) -- http://www.cashtechnologies.com/-- develops and markets innovative data processing solutions in the healthcare and financial services industries. CHAMPION PARTS: Kevin Cain Resigns as VP Finance and CFO -------------------------------------------------------- Champion Parts Inc., in a regulatory filing with the Securities and Exchange Commission on Jan. 22, 2008, disclosed that on Jan. 18, 2008, Kevin J. Cain, vice president of finance and chief financial officer, notified Champion Parts Inc. that he is resigning from the company, effective Jan. 22, 2008. Headquartered in Hope, Arkansas, Champion Parts Inc. (OTC:CREBQ) -- http://www.championparts.net/-- remanufactures fuel system components, air conditioning compressors, front wheel drive assemblies, and other underhood electrical and mechanical products for the passenger car and light truck, agricultural, heavy-duty truck and marine parts aftermarket. The company filed for chapter 11 bankruptcy protection on Oct. 10, 2007 (Bankr. W.D. Ark. Case No. 07-73253). James F. Dowden, Esq. represents the Debtor in its restructuring efforts. When the Debtor filed for bankruptcy, it listed total assets of $26,389,000 and total debts of $25,251,000. CHARLES WILLIAMS: Case Summary & Four Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Charles A. Williams aka Buster Williams 220 West 139th Street New York, NY 10030 Bankruptcy Case No.: 08-10224 Chapter 11 Petition Date: January 22, 2008 Court: Southern District of New York (Manhattan) Debtor's Counsel: Wayne M. Greenwald, Esq. Wayne M. Greenwald, P.C. 99 Park Avenue Suite 800 New York, NY 10016 Tel: (212) 983-1922 Fax: (212) 953-7755 Estimated Assets: $0 to $50,000 Estimated Debts: $1 Million to $10 Million Debtor's list of its Four Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Pmichaelmk Med1 Emergency $150 1861-09 Union Turn Med Association of Flushing, NY 11366 Siro Internal Revenue Service Unknown 11601 Roosevelt Boulevard P.O. Box 21126 Philadelphia, PA 19114 NYC Department of Finance Unknown 345 Adams Street - 3rd Floor Legal Affairs - D. Cohen Brooklyn, NY 11201-3719 NYS Department of Tax and Finance Unknown CHASE MORTGAGE: Fitch Downgrades Ratings on 17 Cert. Classes ------------------------------------------------------------ Fitch Ratings has affirmed 16 and downgraded 17 classes from the following Chase Mortgage Finance Corp. mortgage pass-through certificates: Series 2006-A1 -- Class A affirmed at 'AAA'; -- Class M affirmed at 'AA'; -- Class B-1 affirmed at 'A'; -- Class B-2 downgraded to 'BBB-' from 'BBB'; -- Class B-3 downgraded to 'B' from 'BB'; -- Class B-4 downgraded to 'C/DR4' from 'B'. Series 2006-S1 -- Class A affirmed at 'AAA'; -- Class M affirmed at 'AA'; -- Class B-1 affirmed at 'A'; -- Class B-2 downgraded to 'BB+' from 'BBB'; -- Class B-3 downgraded to 'B' from 'BB'; -- Class B-4 downgraded to 'C/DR4' from 'B'. Series 2006-S2 -- Class A affirmed at 'AAA'; -- Class A-M affirmed at 'AA+'; -- Class M-1 affirmed at 'AA'; -- Class B-1 affirmed at 'A'; -- Class B-2 downgraded to 'BB+' from 'BBB'; -- Class B-3 downgraded to 'C/DR3' from 'BB'; -- Class B-4 downgraded to 'C/DR5' from 'B'. Series 2006-S3 -- Class A affirmed at 'AAA'; -- Class A-M affirmed at 'AA+'; -- Class M-1 affirmed at 'AA'; -- Class B-1 downgraded to 'BBB+' from 'A'; -- Class B-2 downgraded to 'BB' from 'BBB'; -- Class B-3 downgraded to 'C/DR4' from 'BB'; -- Class B-4 downgraded to 'C/DR5' from 'B'. Series 2006-S4 -- Class A affirmed at 'AAA'; -- Class A-M affirmed at 'AA+'; -- Class M-1 affirmed at 'AA'; -- Class B-1 downgraded to 'A-' from 'A'; -- Class B-2 downgraded to 'BB' from 'BBB'; -- Class B-3 downgraded to 'C/DR4' from 'BB'; -- Class B-4 downgraded to 'C/DR5' from 'B'. The affirmations affect approximately $3.2 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 $35.6 million in 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 or acquired by JP Morgan Chase and Chase Home Finance. As of the December 2007 distribution date, series 2006-A1 is seasoned 16 months. The pool factor is 82%. Percentage of loans delinquent 60 days or more is 1.68% and there are no losses to date. For the same distribution date, series 2006-S1 to 2006-S4 are seasoned 13-20 months. Pool factors range from 80%-84%. Percentage of loans delinquent 60 days or more vary from 1.06% to 1.70%. Series 2006-S1 and 2006-S4 have no losses to date, while series 2006-S2 and 2006-S3 have minimal losses. CHRYSLER LLC: Unit Inks Product Development Pact With Tata Motors ----------------------------------------------------------------- A unit of Chrysler LLC has entered into an agreement with Tata Motors Ltd. for the development of an electric version of Tata's mini truck Ace, media reports say. Pursuant to a development contract that Tata Motors entered into with Chrysler's Global Electric Motorcars, the parties will develop and market battery-operated neighborhood electric vehicles that will be sold in the United States. The NEVs, which can ferry passengers and cargo, has passed required safety and reliability tests, and the prototype is ready for production, Alka Kshirsagar of the Business Line relates, citing unnamed sources in the industry. The vehicles, which will be shipped as completely built units, will mark Tata Motor's entry into the U.S. markets, BL points out. A Tata Motors spokesperson has admitted that the company, in partnership with an American firm, is exploring the possibility of a vehicle on the Ace platform with a U.S.-suitable electrical engine, BL relates. "But it is premature at this stage to furnish any details," the spokesperson added. According to Reuters, Tata Motors will begin exporting around 10,000 units by year-end, and ramp up to 50,000 units. About Tata Motors India's largest automobile company, Tata Motors Limited -- http://www.tatamotors.com/-- is mainly engaged in the business of automobile products consisting of all types of commercial and passenger vehicles, including financing of the vehicles sold by the Company. The Company's operating segments consists of Automotive and Others. In addition to its automotive products, it offers construction equipment, engineering solutions and software operations. Tata Motors has operations in Russia and the United Kingdom. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. CIENA CORP: Inks Buyout Deal With World Wide Packets ---------------------------------------------------- Ciena Corporation has reached a definitive agreement to acquire World Wide Packets. "As part of our strategy to leverage Ethernet as the vehicle for network convergence to optimize the cost and efficiency of network resources, the addition of World Wide Packets' technology expands our ability to address the access and aggregation tiers of the network with simplified IP/Ethernet service architectures," Gary Smith, president and chief executive officer of Ciena said. "Bringing to our FlexSelect(TM) Architecture these flexible, highly-scalable Carrier Ethernet service delivery platforms further advances us in the high-growth business Ethernet services market and strengthens our position in the emerging wireless backhaul space." "Since the inception of the company, it has been the goal of World Wide Packets to define and provide the next-generation of Carrier Ethernet solutions, and today's news is conclusive validation of our approach," Matthew Frey, president and chief operating officer of World Wide Packets said. "Our expertise in True Carrier Etherne(TM) combined with the power and flexibility of Ciena's FlexSelect Architecture provides customers with a compelling and cost-effective solution for delivering Carrier Ethernet-based services." Ciena also has been awarded a multi-year contract with AT&T to supply the global carrier with these platforms. Carrier Ethernet Market Industry analyst firm Infonetics Research forecasts worldwide revenue for Ethernet services to surpass $25 billion in 2010, growing at a 5-year CAGR of 28 percent, representing a five-year total of nearly $87 billion. Growth is being driven by the growing migration from legacy services to Ethernet-based services across enterprise segments. "Now more than ever, network operators are seeking to drive down network costs and complexity while boosting capacity, and they are increasingly turning to Ethernet as the solution of choice for achieving those goals," Michael Howard, principal analyst, Infonetics Research said. "In our bandwidth-hungry world, simplicity, cost efficiency and flexibility are more than just marketing clich�s, they are the hallmarks of today's Carrier Ethernet networks." "Pairing with World Wide Packets makes a lot of sense for Ciena, as it nicely enhances the performance-grade Ethernet capabilities of the FlexSelect Architecture," Mr. Howard added. Transaction Terms and Timing Under the terms of the acquisition agreement, World Wide Packets will merge with a subsidiary of Ciena, and all outstanding shares of World Wide Packets common and preferred stock, including employee stock options and warrants, will be exchanged for approximately $200 million in cash and 3.4 million shares of Ciena common stock. In addition, Ciena will assume up to $15 million in outstanding World Wide Packets debt. Based on the closing price of Ciena's stock on Friday Jan. 18, 2008, of $26.52, the aggregate value of the shares to be issued by Ciena is approximately $90 million. This transaction is subject to various conditions and approval by appropriate government agencies. The boards of directors of both Ciena and World Wide Packets have approved the transaction. It is expected that this transaction will close during Ciena's second quarter of fiscal 2008. Following completion of this transaction, World Wide Packets will continue to operate from its Spokane Valley, Washington and San Jose, California locations. Morgan Stanley served as financial advisor to Ciena on this transaction. Goldman Sachs served as financial advisor to World Wide Packets. About World Wide Packets Headquartered in Spokane Valley, Washington, World Wide Packets -- http://www.worldwidepackets.com-- develops, manufactures, and markets commercial and residential broadband equipment for Ethernet networks using fiber and copper infrastructure. The company's LightningEdge series of products includes portals, concentrators and distributors. It counts utilities, telecommunications, cable, and real estate development companies around the world, as well as public entities and learning institutions, among its customers. About Ciena Corporation Headquartered in Linthicum, Maryland, Ciena(R) Corporation -- http://www.ciena.com/-- supplies communications networking equipment, software and services that support the delivery and transport of voice, video and data services. Its products are used in communications networks operated by telecommunications service providers, cable operators, governments and enterprises worldwide. The company is engaged in transitioning communications networks to converged architectures, capable of delivering a mix of high- bandwidth communications services. Ciena Corporation's product portfolio includes a range of communications networking equipment that is located from the core of communications networks to the edge, where end users gain access to communications services. Its products include transport and switching, packet interworking, access, network and service management tools, and global network services. CIENA CORP: WWP Merger Won't Affect S&P's "B" Corporate Rating -------------------------------------------------------------- Ciena Corp. (B/Positive/--) announced that it has a definitive agreement to acquire privately held World Wide Packets (WWP) for $215 million in cash and assumed debt, and about $90 million in stock. Standard & Poor's Ratings Services said the acquisition, expected to close in the April 2008 quarter pending regulatory approval, would not affect its corporate credit rating on Ciena. Ciena provides Ethernet-based equipment for carrier backbone networks. Spokane Valley, Washington-based WWP provides Ethernet- based network access and traffic aggregation equipment, which supplements Ciena's own Ethernet product line. Revenues were about $30 million in 2007, although profitability is not disclosed. Ethernet transport is widely used in enterprise campus networks, and the merged company's products should enable efficient transfer of enterprise data between distant locations. Still, the acquisition will entail transitional costs and the risks of product-line integration. Following the acquisition, Ciena's customer base will remain highly concentrated among a few carriers. Ciena has ample liquidity to manage its operations following the acquisition, with pro forma cash balances near $1 billion. The company's profitability has been improving, with EBITDA of $39 million in the October 2007 quarter, compared with $20 million in the year-ago period. Still, total debt levels are high. Pro forma debt to EBITDA is about 9x, and unlikely to improve over the near term as WWP is integrated. Ratings could be adjusted upward over the longer term as the anticipated benefits of the acquisition are realized in revenues and profitability. CITICORP MORTGAGE: Fitch Holds 'B' Ratings on Seven Cert. Classes ----------------------------------------------------------------- Fitch Ratings has taken rating actions on these Citicorp Mortgage Securities, Inc. mortgage pass-through certificates: Series 2005-1 -- 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 affirmed at 'B'. Series 2005-2 -- 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 affirmed at 'BB'; -- Class B-5 affirmed at 'B'. Series 2005-3 -- 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 affirmed at 'B'. Series 2005-6 -- 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 affirmed at 'B'. Series 2006-3 -- 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 affirmed at 'B'. Series 2006-4 -- 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 affirmed at 'B'. Series 2006-6 -- 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 rated 'B', placed on 'Rating Watch Negative'. Series 2006-7 -- 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 affirmed at 'B'. The affirmations, affecting approximately $3 billion of the outstanding certificates, reflect a stable relationship between credit enhancement and expected loss. The Rating Watch Negative status affects $540,904 of the outstanding certificates. The collateral of the above transactions primarily consists of conventional, fully amortizing, fixed-rate mortgage loans extended to prime borrowers and secured by first-liens on one- to four- family residential properties. All of the loans were originated or acquired by CitiMortgage, Citi FSB, or Citibank and are serviced by CitiMortgage, Inc, which is rated 'RPS1' by Fitch. As of the December 2007 remittance date, the pool factors of the above transactions range from 76% (series 2005-1) to 89% (series 2006-7). In addition, the seasoning ranges from 12 months (series 2006-7) to 34 months (series 2005-1). CITIGROUP MORTGAGE: Fitch Puts 'B' Rated Certs. Under Neg. Watch ---------------------------------------------------------------- Fitch Ratings has taken various rating actions on these Citigroup Mortgage Loan Trust mortgage pass-through certificates: Series 2003-UP3 -- Class A affirmed at 'AAA'; -- Class B-1 upgraded to 'AA+' from 'AA'; -- Class B-2 upgraded to 'A+' from 'A'; -- Class B-3 upgraded to 'BBB+' from 'BBB'; -- Class B-4 affirmed at 'BB'; -- Class B-5 affirmed at 'B'. Series 2004-NCM2 -- Class A affirmed at 'AAA'; -- Class B-1 upgraded to 'AA+' from 'AA'; -- Class B-2 upgraded to 'A+' from 'A'; -- Class B-3 affirmed at 'BBB'; -- Class B-4 affirmed at 'BB'; -- Class B-5 affirmed at 'B'. Series 2005-1 Pool 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 affirmed at 'BBB'. Series 2005-2 Pool 1 -- Class I-A affirmed at 'AAA'; -- Class I-B-1 affirmed at 'AA'; -- Class I-B-2 affirmed at 'A'; -- Class I-B-3 affirmed at 'BBB'; -- Class I-B-4 affirmed at 'BB'; -- Class I-B-5 rated 'B', placed on Rating Watch Negative. Series 2005-2 Pool 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 affirmed at 'BBB'; -- Class II-B-4 affirmed at 'BB'; -- Class II-B-5 affirmed at 'B'. Series 2005-3 Pool 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 downgraded to 'BBB-' from 'BBB'; -- Class II-B-4 downgraded to 'B' from 'BB'; -- Class II-B-5 downgraded to 'C/DR4' from 'B'. Series 2005-9 Group 1 -- Class I-A affirmed at 'AAA'; -- Class I-B-1 affirmed at 'AA'; -- Class I-B-2 affirmed at 'A'; -- Class I-B-3 downgraded to 'B' from 'BBB' and placed on Rating Watch Negative. Series 2005-9 Group 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 downgraded to 'BBB+' from 'A'; -- Class II-B-3 downgraded to 'BB-' from 'BBB'. Series 2006-AR6 Group 1 -- Class I-A affirmed at 'AAA'; -- Class I-B-1 affirmed at 'AA'; -- Class I-B-2 affirmed at 'A'; -- Class I-B-3 rated 'BBB', placed on Rating Watch Negative; -- Class I-B-4 downgraded to 'BB-' from 'BB'; -- Class I-B-5 downgraded to 'C/DR4' from 'B'. Series 2006-AR9 Group 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 affirmed at 'BBB'; -- Class II-B-4 downgraded to 'B' from 'BB' and placed on Rating Watch Negative; -- Class II-B-5 downgraded to 'C/DR5' from 'B'. Series 2007-2 -- 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'. Series 2007-6 Group 1 -- Class I-A rated 'AAA', placed on Rating Watch Negative; -- Class I-B-1 downgraded to 'A+' from 'AA' and placed on Rating Watch Negative; -- Class I-B-2 downgraded to 'BB+' from 'A'; -- Class I-B-3 downgraded to 'C/DR4' from 'BBB'; -- Class I-B-4 downgraded to 'C/DR5' from 'BB'; -- Class I-B-5 downgraded to 'C/DR6' from 'B'. Series 2007-6 Group 2 -- Class II-A rated 'AAA', placed on Rating Watch Negative; -- Class II-B-1 downgraded to 'A' from 'AA' and placed on Rating Watch Negative; -- Class II-B-2 downgraded to 'BB+' from 'A'; -- Class II-B-3 downgraded to 'B' from 'BBB'; -- Class II-B-4 downgraded to 'C/DR4' from 'BB'; -- Class II-B-5 downgraded to 'C/DR5' from 'B'. Series 2007-AR5 Group 1 -- Class I-A affirmed at 'AAA'; -- Class I-B-1 downgraded to 'AA-' from 'AA'; -- Class I-B-2 downgraded to 'BBB+' from 'A'; -- Class I-B-3 downgraded to 'B+' from 'BBB'; -- Class I-B-4 downgraded to 'C/DR4' from 'BB'; -- Class I-B-5 downgraded to 'C/DR5' from 'B'. Series 2007-AR5 Group 2 -- Class II-A affirmed at 'AAA'; -- Class II-B-1 affirmed at 'AA'; -- Class II-B-2 affirmed at 'A'; -- Class II-B-3 downgraded to 'BBB-' from 'BBB'; -- Class II-B-4 downgraded to 'B+' from 'BB'; -- Class II-B-5 downgraded to 'C/DR4' from 'B'. Series 2007-AR7 -- Class A rated 'AAA', placed on Rating Watch Negative; -- Class B-1 downgraded to 'A+' from 'AA' and placed on Rating Watch Negative; -- Class B-2 downgraded to 'BB+' from 'A'; -- Class B-3 downgraded to 'C/DR4' from 'BBB'; -- Class B-4 downgraded to 'C/DR5' from 'BB'; -- Class B-5 downgraded to 'C/DR5' from 'B'. The upgrades, affecting approximately $27.8 million of the outstanding certificates, are taken as a result of an improvement in the relationship between credit enhancement and expected loss. The affirmations, affecting approximately $4 billion of the outstanding certificates, reflect a stable relationship between credit enhancement and expected loss. The downgrades, affecting approximately $226 million of the outstanding certificates, are taken as a result of a deteriorating relationship between credit enhancement and expected loss. The Rating Watch Negative status affects approximately $1.7 billion of the outstanding certificates. The negative rating actions on the 2005 through 2007 vintage CMLT transactions are because of current trends in the relationship between serious delinquency and credit enhancement. The 90+ DQ for transactions with negative rating actions ranges from 0.63% (series 2006-AR6 Group 1) to 9.54% (series 2007-AR7) of the current collateral balance. The collateral of the above transactions generally consists of fixed-rate and adjustable-rate mortgage loans extended to Prime or Alt-A borrowers and secured by first liens on one- to four-family residential properties. In general, the loans were originated by various originators and are serviced by various servicers. As of the December 2007 remittance date, the pool factors of the above transactions range from 24% (series 2003-UP3) to 96% (series 2007-6 Group 2). In addition, the seasoning ranges from seven months (series 2007-AR7) to 49 months (series 2003-UP3). CITIMORTGAGE ALTERNATIVE: Fitch Junks Ratings on 8 Cert. Classes ---------------------------------------------------------------- Fitch Ratings has taken rating actions on these CitiMortgage Alternative Loan Trust mortgage pass-through certificates: Series 2006-A3 -- 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 2007-A1 -- Class A affirmed at 'AAA'; -- Class B-1 rated 'AA' is placed on 'Rating Watch Negative'; -- 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 2007-A2 -- Class A affirmed at 'AAA'; -- Class B-1 rated 'AA' is placed on 'Rating Watch Negative'; -- 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 2007-A3 -- Class A affirmed at 'AAA'; -- Class B-1 rated 'AA' is placed on 'Rating Watch Negative'; -- 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 2007-A5 -- Class A affirmed at 'AAA'; -- Class B-1 rated 'AA' is placed on 'Rating Watch Negative'; -- 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, affecting approximately $2.7 billion of the outstanding certificates, reflect a stable relationship between credit enhancement and expected loss. The downgrades, affecting approximately $66.8 million of the outstanding certificates, are taken as a result of a deteriorating relationship between credit enhancement and expected loss. In addition, the Rating Watch Negative status affects $66.5 million of the outstanding certificates. The negative rating actions on the subordinate classes of the above transactions are caused by current trends in the relationship between serious delinquency and credit enhancement. As of the December 2007 remittance date, the 90+ DQ ranges from of 1.41% (series 2007-A3) to 1.84% (series 2007-A2) of the current collateral balance. The collateral of the above transactions consists of conventional, fully amortizing, fixed-rate mortgage loans extended to Alt-A borrowers and secured by first-liens on one- to four-family residential properties. All of the loans were originated or acquired by and are serviced by CitiMortgage, Inc, which is rated 'RPS1' by Fitch. The pool factors of the above transactions range from 84% (series 2006-A3) to 96% (series 2007-A5). In addition, the seasoning ranges from 7 months (series 2007-A5) to 15 months (series 2006- A3). COMM 2006-C8: Scheduled Amortization Cues Fitch to Hold Ratings --------------------------------------------------------------- Fitch has affirmed these COMM 2006-C8 Mortgage Trust, commercial mortgage pass-through certificates: -- $48.0 million class at A-1 'AAA'; -- $100.0 million class A-2A at 'AAA'; -- $366.0 million class A-2B at 'AAA'; -- $244.5 million class A-3 at 'AAA'; -- $92.5 million class A-AB at 'AAA'; -- $1.1 billion class A-4 at 'AAA'; -- $668.8 million class A-1A at 'AAA'; -- $377.6 million class A-M at 'AAA'; -- $302.1 million class A-J at 'AAA'; -- Interest-only class X-P at 'AAA'; -- Interest-only class X-S at 'AAA'; -- $28.3 million class B at 'AA+'; -- $42.5 million class C at 'AA'; -- $37.8 million class D at 'AA-'; -- $23.6 million class E at 'A+'; -- $28.3 million class F at 'A'; -- $51.9 million class G at 'A-'; -- $37.8 million class H at 'BBB+'; -- $42.5 million class J at 'BBB'; -- $42.5 million class K at 'BBB-'; -- $18.9 million class L at 'BB+'; -- $18.9 million class M at 'BB'. -- $4.7 million class N at 'BB-'; -- $9.4 million class O at 'B+'; Fitch does not rate the $14.2 million class P certificates, $9.4 million class Q certificates, or $42.5 million class S certificates. The affirmations reflect scheduled amortization and stable performance since issuance. As of the January 2008 distribution date, the transaction's outstanding principal balance has been reduced by 0.1% to $3.771 billion from $3.776 billion at issuance. There are currently no delinquent or specially serviced loans. Fitch reviewed year-end 2006 operating statement analysis reports for the transaction's four shadow rated loans (5.5%): First City Tower (2.5%), Ryan's Steakhouse (1.7%), Casual Male HQ (0.8%), and Minnesota Office Building (0.5%). Based on their stable performance since issuance the loans maintain their investment grade credit assessments. The largest shadow rated loan, First City Tower (2.5%), is secured by the fee/leasehold interest in a 1.3 million square foot office property in Houston, Texas. Major tenants include Vinson & Elkins LLP, Waste Management Inc., and Enervest Management Partners. Occupancy as of September 2007 has improved to 92.0% from 85.1% at issuance. The second largest shadow rated loan, Fortress/Ryan's Portfolio (2.5%), is collateralized by a portfolio consisting of 114 fee and 16 leasehold interests in a total of 130 retail properties located in 22 different states. As of June 30, 2007, occupancy has remained stable at 100% since issuance. COMPASS DIVERSIFIED: Arm Completes Staffmark Investment Buyout -------------------------------------------------------------- Compass Diversified Holdings and Compass Group Diversified Holdings LLC's subsidiary, CBS Personnel Holdings Inc., consummated the acquisition of Staffmark Investment LLC. On Dec. 19, 2007, CBS Personnel entered into a definitive agreement to acquire Staffmark Investment. Under the terms of the transaction, CODI, through CBS, will invest approximately $80 million in cash to retire Staffmark's existing debt. With the closing of the transaction, Staffmark's existing shareholders will retain approximately 29% of the diluted equity in the combined CBS - Staffmark business. Staffmark's Earnings Before Interest, Taxes, Depreciation and Amortization for 2007 is estimated to be approximately $18 million, before taking into account any synergistic benefits resulting from the merger with CBS. As part of the acquisition, CBS has structured a step up in tax basis in excess of $100 million, the positive effect of which will be significant on CBS's annual cash flow. About Staffmark Investment LLC Staffmark is a provider of commercial staffing services in the U.S. The company provides staffing services in 29 states through 222 branches and on-site locations. The majority of the company's revenues are derived from light industrial staffing, with the balance of revenues derived from administrative and transportation staffing, permanent placement services and managed solutions. Similar to CBS, Staffmark is a privately held staffing companies in the United States. About Compass Diversified Holdings Headquartered in Westport, Connecticut, Compass Diversified Holdings - http://www.compassdiversifiedholdings.com/-- (Nasdaq GS: CODI) is a Delaware statutory trust that was formed on Nov. 18, 2005, to acquire and manage a group of middle market businesses that are headquartered in North America. CODI provides public investors with an opportunity to participate in the ownership and growth of companies which have historically been owned by private equity firms, wealthy individuals or families. Compass Group Diversified Holdings LLC, a Delaware limited liability company, was also formed on Nov. 18, 2005. In accordance with the Trust Agreement, Compass Diversified Holdings is the sole owner of 100% of the trust's Interests of Compass Group Diversified Holdings LLC. Compass Group Diversified Holdings LLC is the operating entity with a board of directors and other corporate governance responsibilities, similar to that of a Delaware corporation. Compass Diversified Holdings is managed by Compass Group Management LLC, which was established in 1998 as a private equity manager for an offshore philanthropic foundation established by J. Torben Karlshoej, the late founder of Teekay Shipping Corporation. Headquartered in Cincinnati, Ohio, CBS Personnel Holdings Inc. and its consolidated subsidiaries, referred to as CBS Personnel, is a provider of temporary staffing services in the United States. CBS Personnel operates 435 branch locations in 35 states (includes Staffmark). * * * As reported in the Troubled Company Reporter on Nov. 9, 2007, Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to Compass Group Diversified Holdings LLC. The outlook is stable. At the same time, S&P assigned bank loan and recovery ratings to Compass's $200 million first-lien term loan due 2013. The loan is rated 'BB-' with a recovery rating of '4', indicating S&P's expectation of average (30%-50%) recovery in the event of a payment default. CONSTELLATION BRANDS: Selling Three Wine Brands for $134 Million ---------------------------------------------------------------- Constellation Brands Inc. has entered into an agreement to sell the Almaden and Inglenook wine brands, and the Paul Masson winery located in Madera, California, to The Wine Group LLC for $134 million in cash, subject to closing adjustments. Close of the transaction is subject to routine and customary regulatory review, and is expected by the end of Constellation's fiscal year on Feb. 29, 2008. "This transaction, when coupled with the recent acquisition of Clos du Bois, the number one super-premium U.S. wine brand, will allow our wine sales forces to focus on selling higher-growth, higher-margin premium wines," Rob Sands, Constellation Brands president and chief executive officer, said. "This change also demonstrates our commitment to improve return on invested capital." Almaden and Inglenook are table wines which retail for less than $3 per 750 ml bottle equivalent," Mr. Sands added. "The Mission Bell Winery, also in Madera, California, will be retained and allows the company to increase premium wine production in California's important San Joaquin Valley wine producing region. This winery will also provide wine production services to The Wine Group for a period of time on a contract basis. The transaction is expected to result in a pre-tax loss of approximately $27 million or an after-tax loss of $0.13 diluted earnings per share on a reported basis, and will be excluded from the company's comparable basis earnings per share. The loss on the disposal is driven by the higher write-off of goodwill unrelated to these brands as required by generally accepted accounting principles in the U.S. and the low tax basis associated with goodwill. Proceeds from the transaction will be used to reduce borrowings. The impact of this transaction is expected to be slightly dilutive to ongoing reported basis and comparable basis diluted earnings per share for fiscal 2009. The Almaden and Inglenook wine brands are expected to generate approximately $130 million of net sales for fiscal 2008, and represent approximately 10 million 9-liter cases of the company's U.S. wine volume. The proceeds from this transaction do not impact free cash flow, and therefore the company's free cash flow guidance for fiscal 2008 remains unchanged at $280 - $300 million. About Constellation Brands Headquartered in Fairport, New York, Constellation Brands Inc. (NYSE:STZ) -- http://www.cbrands.com/-- has more than 250 brands in its portfolio, sales in approximately 150 countries and operates approximately 60 wineries, distilleries and distribution facilities. The company has market presence in the U.K., Australia, Canada, New Zealand; Mexico. Barton Brands Ltd. is the spirits division of Constellation Brands Inc. is a producer, importer and exporter of a wide range of spirits products, including brands such as Black Velvet Canadian Whisky, Ridgemont Reserve 1792 bourbon, and Effen vodka. * * * As reported in the Troubled Company Reporter on Dec. 3, 2007, Fitch Ratings assigned a 'BB-' rating to a note registered by Constellation Brands Inc. to fund the purchase price of Beam Wine Estates Inc., a subsidiary of Fortune Brands Inc: $500 million 8.375% senior unsecured note due Dec. 15, 2014. The rating outlook is negative. CREDIT SUISSE: Fitch Holds Low-B Ratings on Three Cert. Classes --------------------------------------------------------------- Fitch Ratings upgraded Credit Suisse First Boston Mortgage Securities Corp.'s commercial mortgage pass-through certificates, series 2001-CK1, as: -- $20.2 million class F to 'AAA' from 'AA+'; -- $17.7 million class G to 'AA+ from 'AA-'. Fitch also affirmed these classes: -- $494.1 million class A-3 at 'AAA'; -- Interest-only class A-X at 'AAA'; -- Interest-only class A-Y at 'AAA'; -- Interest-only class A-CP at 'AAA'; -- $42.9 million class B at 'AAA'; -- $45.4 million class C at 'AAA'; -- $12.6 million class D at 'AAA'; -- $12.6 million class E at 'AAA'; -- $17.5 million class H at 'A-'; -- $27.4 million class J at 'BB+'; -- $7.5 million class K at 'BB'; -- $7.5 million class L at 'B+'. Fitch does not rate classes M, N, and O. Classes A-1 and A-2 have paid in full. The upgrades to classes F and G are due to an additional 15% defeasance and 15% pay down since the last Fitch rating action. In total, 39 loans (41%) have defeased, including five (18.6%) of the top 10 loans. As of the January 2008 distribution date, the transaction has been reduced by 26.3% to $734.9 million from $997.1 million at issuance. There are, however, 12% of the loans in the transaction with either a debt service coverage ratio of less than 1.0 times or an underperforming occupancy rate. Additionally, there are two (4%) specially serviced assets. The largest specially serviced asset (3.7%) is a portfolio of four cross-collateralized, cross-defaulted multifamily buildings consisting of 1,180 units. The portfolio transferred to special servicing in August 2006 due to technical default because of a low DSCR and existence of significant deferred maintenance. Three of the assets are located in Texas and one is located in Indianapolis, Indiana. Occupancy for the four buildings ranges from 26% to 51%. The loan is current and the special servicer is working with the borrower, Alliance Holdings, LLC. Fitch projects losses if the default issues are not timely and successfully resolved. The second specially serviced (0.3%) is a 66-unit real estate- owned multifamily asset located in Arlington, Texas. The asset became REO in April 2007 and is listed for sale. December 2007 occupancy was 95%. The non-rated classes are sufficient to absorb any Fitch projected losses on the specially serviced assets. Fitch has also identified the eighth largest loan (2.4%) in the pool as a loan of concern due to declining performance. The property is an office building in Raleigh, North Carolina, that reported September 2007 DSCR of 0.49X and occupancy of 68%. At issuance there were two shadow rated loans: 747 Third Avenue has paid in full and the Stonewood Center Mall (10%) maintains its investment grade shadow rating. The Stonewood Center Mall is secured by the leasehold interest in a 929,792 square foot regional retail mall in Downey, California. According to the master servicer the property is located in a FEMA designated fire zone, but has not sustained damage. As of July 2007, occupancy was 96% compared to 94% at issuance and the anticipated repayment date is December 11, 2010. CROWN CITY: Case Summary & 22 Largest Unsecured Creditors --------------------------------------------------------- Lead Debtor: Crown City Plating Company 3517 W. McKinley Street, #14 Azusa, CA 91702 Bankruptcy Case No.: 08-10879 Type of Business: The Debtor manufactures electroless and electroplate on metal and plastic. Chapter 11 Petition Date: January 22, 2008 Court: Central District Of California (Los Angeles) Judge: Ernest M. Robles Debtors' Counsel: Robert E. Opera, Esq. Winthrop Couchot Professional Corporation 660 Newport Center Drive, Suite 400 Newport Beach, CA 92660 Tel: (949) 720-4100 http://www.winthropcouchot.com/ Total Assets: $8,026,452 Total Debts: $15,903,165 Consolidated Debtors' List of 22 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Crown City Plating Co. Pension $2,504,000 attn: Plan Administrator 4350 Temple City Boulevard El Monte, CA 91731 Hermetic Seal $2,450,000 attn: Corporate Officer 4232 Temple City Boulevard Rosemead, CA 91770 L.A. County Sanitation Fees $36,385 District attn: David Sanchez 1955 Workman Mill Road Whittier, CA 90601 ONSA Engineering trade $35,220 Zelle, Hofman, Voelbel fees $34,623 & Gette CA State Board of Equalization $32,079 Enron gas fees $30,000 Basic Chemical trade $20,688 Auto Tech trade $15,471 Phibro-Tech trade $14,854 Girald Fastener trade $14,841 Univar trade $14,639 SoCal Edison utilities $11,335 Cal Polishing trade $9,687 Acorn Paper trade $9,419 SCMH trade $9,212 M&R Engineering trade $8,950 West Coast Rack trade $8,607 Environmental Recovery trade $5,555 GE Poly trade $4,880 Hart Emplo