T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, January 30, 2008, Vol. 12, No. 25 Headlines 94/BELLEVILLE: Files List of 10 Largest Unsecured Creditors 94/BELLEVILLE: Section 341(a) Meeting Scheduled for February 4 AFFILIATED COMPUTER: Moody's Keeps Ba2 Credit Rating After Review AMERICAN CAPITAL: Voluntary Chapter 11 Case Summary AMERICAN HOME: Court Approves Muldoon Murphy as Special Counsel AMERICAN HOME: Maricopa County Wants Location of Assets Disclosed AMERICAN HOME: U.S. Trustee Objects to Non-Performing Loans Sale AMERICAN LAFRANCE: Wants Court Approval on Cash Collateral Access AMERICAN LAFRANCE: Wants Interim Approval on $10MM DIP Financing AMERISOURCEBERGEN CORP: Earns $109 Mil. in Quarter Ended Dec. 31 BEAR STEARNS: S&P Maintains 'BB' Rating on Class II-B Certificates BERRY PLASTICS: S&P Retains Low-B Ratings on Captive Plastics Buy BLACKBOARD INC: Earns $3.3 Million in 2007 Third Quarter CALPINE CORP: Gets $253.6MM Bid from FirstEnergy for Fremont Plant CARDIOVASCULAR DIAGNOSTIC: Voluntary Chapter 11 Case Summary CBA COMMERCIAL: S&P's Rating on Class M-8 Certs. Tumbles to 'D' CHIQUITA BRANDS: Reviews Capital Structure, Considers Refinancing CHIQUITA BRANDS: Soliciting Consents to Amend Indenture Terms CHIQUITA BRANDS: S&P's Ratings Unmoved by Capital Structure Review CLASS V FUNDING: Moody's Slashes Rating on $45 Mil. Notes to Ba1 CLAYTON HOLDINGS: Cooperates in New York AG's Probe on Banks CLEAR CHANNEL: S&P Retains Negative CreditWatch on B+ Rating CLEVELAND UNLIMITED: Moody's Cuts Corporate Credit Rating to Caa2 COMUNITY LENDING: Court OKs Murray & Murray as Bankruptcy Counsel COMUNITY LENDING: Section 341(a) Meeting Scheduled for February 6 COUNTRYWIDE FIN'L: "Fear" May Have Prompted BofA Merger, WSJ Says COUNTRYWIDE FINANCIAL: CEO Gives Up Severance Pay of $37 Million CYGNAL TECHNOLOGIES: Wants CCAA Protection Extended to March 21 DELPHI CORP: Court Allows Committee Participation in Exit Loan DELPHI CORP: Court Grants Final Approval of MDL Settlements DELTA FINANCIAL: Court Approves De Minimis Assets Sale Procedures DELTA FINANCIAL: Wants Court Okay on Unencumbered Loans Sale DURA AUTOMOTIVE: Seeks Court Consent for $170MM Replacement Loan FANNIE MAE: Eroding Credit Support Prompts S&P's Three Rating Cuts FORD MOTOR: At Ease with Tata Motors' Jaguar Brand Acquisition FOX TROT: Declining Credit Quality Prompts Moody's Rating Review FRIEDMAN'S INC: Judge Sontchi Converts Case to Chapter 11 FRIEDMAN'S INC: Case Summary & 40 Largest Unsecured Creditors G REIT INC: Transfers Remaining Assets to the Liquidating Trust GEORGIA GULF: S&P Downgrades Ratings on Projected Weak Liquidity GOLDEN NUGGET: Moody's Places Ratings on Review for Possible Cuts GOODMAN GLOBAL: Obtains Requisite Consents to Amend Indentures GSAMP TRUST: S&P Cuts Ratings on Two Certs. on Eroding Performance HDB LLC: Case Summary & Two Largest Unsecured Creditors INTERSTATE BAKERIES: Court Approves Amended Disclosure Statement INVERNESS MEDICAL: Inks Agreement to Acquire Matria Healthcare INVERNESS MEDICAL: Moody's Reviews Ratings on Matria Deal INVERNESS MEDICAL: S&P Holds Low-B Ratings on $1.2BB Matria Deal IWT TESORO: Court Approves $12.6 Million Sale to New Stream JEFFRY REUTER: Case Summary & 19 Largest Unsecured Creditors KELLWOOD CO: To Hasten Sun Capital's Tender Offer Completion KELLWOOD CO: Moody's Puts All Ratings on Review for Possible Cuts KIT PACK: Case Summary & 20 Largest Unsecured Creditors LANDRY'S RESTAURANTS: Receives $1.3 Billion Buyout Offer from CEO LANDRY'S RESTAURANT: $1.3 Bil. Offer Cues Moody's Ratings Review LANDRY'S RESTAURANTS: S&P Places All Ratings Under Negative Watch LASATA VIII: Case Summary & Largest Unsecured Creditor LAWRENCE BUILDING: Case Summary & Six Largest Unsecured Creditors LEDCO LIMITED: CAW Demands Severance Pay After Bankruptcy Filing LUBBOCK HOUSING: Moody's Slices Ratings on Revenue Bonds to Ba3 MARKOV CDO: Eight Classes of Notes Acquire S&P's Junk Ratings MASTR SECURITIES: S&P Cuts 25 Classes' Ratings on Weak Performance MATRIA HEALTHCARE: Inks Merger Agreement with Inverness Medical MATRIA HEALTHCARE: Inverness Deal Prompts Moody's Ratings Reviews MERITAGE MORTGAGE: Four Classes Get S&P's Junk Ratings on Losses MID OCEAN: S&P Junks Ratings on Notes Amounting to $169.16 Million MORGAN STANLEY: Fitch Cuts Rating on Class B-4 Certs. to B from BB MOVIE GALLERY: Court Moves Exclusive Plan-Filing Period to June 13 MOVIE GALLERY: Disclosure Statement Hearing Adjourned to Feb. 5 MOVIE GALLERY: Wants to Perform Under Plan Support Pact w/ Sopris NCO GROUP: S&P Holds 'B+' Rating and Says Outlook is Negative NEXINNOVATIONS INC: Tech Data's Claims to be Settled by April 18 ORBIT BRANDS: Wants Court to Dismiss Chapter 11 Case PEGASUS WIRELESS: Case Summary & Five Largest Unsecured Creditors PERFORMANCE TRANSPORTATION: Reed Smith Okayed as Special Counsel PETROLEUM DEVELOPMENT: Earns $4.5 Million in 2007 Third Quarter PHARMED GROUP: Court Authorizes $1.2MM Asset Sale to Invatec PIKE NURSERY: Files Schedules of Assets and Liabilities PIONEER NATURAL: Moody's Maintains 'Ba1' Corporate Family Rating PRC LLC: Seeks to Hire Jenner & Block as Special Conflicts Counsel PRC LLC: Wants to Hire CXO LLC as Restructuring Advisors PRC LLC: Wants Court Nod on Evercore Group as Investment Bankers PROPEX INC: Section 341(a) Creditors Meeting Scheduled for March 4 PROPEX INC: U.S. Trustee Appoints Five-Member Creditors' Committee RESIDENTIAL ASSET: S&P Cuts Ratings on Four Certificate Classes RJO HOLDINGS: Moody's Withdraws Ratings Due to Business Reasons ROCK-TENN CO: Earns $17.5 Million in Quarter Ended December 31 ROCKFORD PRODUCTS: Section 341(a) Meeting Scheduled for March 13 ROCKFORD PRODUCTS: Chapter 7 Trustee Taps McGreevy as Counsel SALANDER-O'REILLY: CRO Wants RFR's Motion to Seize Mansion Denied SCOTTS MIRACLE: Posts $56.8MM Net Loss in Qtr. Ended December 29 SEARS HOLDINGS: Names W. Bruce Johnson as Interim CEO SEARS HOLDINGS: CEO's Planned Departure Won't Affect S&P's Ratings SMURFIT-STONE: Incurs $103 Million Net Loss in Year Ended Dec. 31 SOFA EXPRESS: Gets Final OK to Access Wells Fargo's DIP Financing SOFA EXPRESS: Wants Court to Set March 31 as Claims Bar Date SOUTHAVEN POWER: Court Okays Bidding Procedure for Sale of Assets SOUTHAVEN POWER: Exclusive Plan Filing Period Extended to April 14 SPORTSTUFF INC: Section 341(a) Creditors' Meeting Set for Feb. 1 ST PAUL HOUSING: S&P Alters Outlook to Positive; Holds BB+ Rating STACEY HENRIKSON: Case Summary & 30 Largest Unsecured Creditors STRUCTURED FINANCE: Moody's Cuts Rating on $15 Million Notes TEKNI-PLEX INC: Moody's Junks Ratings on $150 Mil. Senior Notes TLC VISION: Moody's Revises Outlook from Stable to Negative TOUSA INC: Inks Deal with Senior Noteholders, Files for Chapter 11 TOUSA INC: Case Summary & 49 Largest Unsecured Creditors TOUSA INC: Bankruptcy Filing Prompts Fitch's 'D' Rating TOUSA INC: Bankruptcy Filing Spurs Moody's Default Rating TOUSA INC: Wilmington Says It Has No Credit Exposure TYSON FOODS: Earns $34 Million in Quarter Ended December 29 VICTOR PLASTICS: Wants to Hire Ravich Meyer as Bankruptcy Counsel VICTOR PLASTICS: Taps Morris-Anderson as Consultants WELLCARE HEALTH: Moody's Cuts Senior Debt Rating to Ba2 WHOLE FOODS: Moody's Withdraws Low-B Ratings For Business Reasons WILLIAMS PARTNERS: Moody's Lifts Senior Unsecured Rating to Ba2 WIN WIN GAMING: Case Summary & 20 Largest Unsecured Creditors * Fitch Lifts 237 and Holds 24 Ratings on Tobacco Settlement Bonds * Fitch Says CMBS Servicer Will Undergo First Time Testing * S&P Cuts Ratings on 29 Class Certificates from 10 Series * S&P Takes Rating Actions on Various U.S. Synthetic CDOs * Upcoming Meetings, Conferences and Seminars ********* 94/BELLEVILLE: Files List of 10 Largest Unsecured Creditors ----------------------------------------------------------- 94/Belleville Restaurant, Inc. submitted to the U.S. Bankruptcy Court for the Eastern District of Michigan its list of 10 largest unsecured creditors, disclosing: Entity Nature of Claim Claim Amount ------ --------------- ------------ Oakland Commerce Bank $483,000 c/o William Rheaume, Esq. 200 North Washington Square Lansing, MI 48933 Puka Capital Funding, LLC $480,000 c/o David Warren 30665 Northwestern Highway Suite 200 Farmington, MI 48334 State of Michigan Taxes $124,419 Department of Treasury Collection Division P.O. Box 77437 Detroit, MI 48277 DTE Energy Trade $33,000 Receivables Control Corp. $3,384 Van Buren Charter Township Taxes $1,570 ITW Food Equipment Group Trade $739 American Credit Association Trade $691 Detroit Newspaper Partnership Trade $365 Internal Revenue Service Tax Obligations Unknown Based in Belleville, Michigan, 94/Belleville Restaurant, Inc. owns and operates restaurants. The company filed for Chapter 11 protection on Jan. 2, 2008 (Bankr. E.D. Mich. Case No. 08-40012). Robert N. Bassel, Esq. represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed estimated assets and liabilities of $1 million to $100 million. 94/BELLEVILLE: Section 341(a) Meeting Scheduled for February 4 -------------------------------------------------------------- The U.S. Trustee for Region 9 will convene a meeting of 94/Belleville Restaurant, Inc.'s creditors on Feb. 4, 2008, at 2:30 p.m., at the 211 West Fort Street Building, Room 315 E, in Detroit, Michigan. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Based in Belleville, Michigan, 94/Belleville Restaurant, Inc. owns and operates restaurants. The company filed for Chapter 11 protection on Jan. 2, 2008 (Bankr. E.D. Mich. Case No. 08-40012). Robert N. Bassel, Esq. represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed estimated assets and liabilities of $1 million to $100 million. AFFILIATED COMPUTER: Moody's Keeps Ba2 Credit Rating After Review ----------------------------------------------------------------- Moody's Investors Service confirmed Affiliated Computer Services' Ba2 corporate family rating with a stable rating outlook. This rating confirmation concludes a review for possible downgrade initiated on March 20, 2007, which was prompted by the company's announcement that founder and chairman Darwin Deason and private equity fund Cerberus Capital Management had proposed to buy the company. The ratings of ACS remained under review for possible downgrade following Cerberus' withdrawal of its offer on Oct. 31, 2007, as the termination triggered a public dispute between the chairman and the former outside directors. The recent resignation of all five former outside directors, at Mr. Deason's request, ended the dispute. Resolution of the board dispute has reduced near-term uncertainty given the potential distraction to the ongoing business that a protracted fight could have caused. Nevertheless, the independence and effectiveness of the new board's oversight remains a key corporate governance concern. ACS' Ba2 rating is supported by the company's size and profitability, as measured by its adjusted pretax income ($464 million for the twelve months ended September 2007) and returns on assets (4.2% adjusted for pensions and leases). Moody's believes that ACS' pretax income and returns will remain within ranges appropriate for the Ba2 rating given the company's relatively sizeable offshore employee footprint (over 30% of commercial business employees domiciled offshore) and continued growth in the higher margin BPO markets (about 75% of total revenues) and government business segment (about 40% of total revenues). Although ACS' organic growth has slowed from mid-teens prior to 2005 to the low to mid single digits, its contract renewal rate remains strong at 94% in 2007. Furthermore, Moody's believes that bookings level should improve over the next twelve months as the disruptions of the past year have subsided with management now focused on stabilizing and growing the business. The Ba2 rating is constrained by the company's financial leverage (as measured by free cash flow to adjusted debt) and interest coverage (as measured by its EBITDA less capital expenditures to interest expense), which collectively compare to business services peers rated in the Ba3 category. The rating is further constrained by management's aggressive financial policies, corporate governance concerns, the company's sluggish bookings growth rates, legal overhang related to prior improper stock options granting practices, and sizable capital expenditures as a percentage of EBITDA (about 45% on a Moody's adjusted basis). The stable outlook reflects the company's relatively steady internal revenue growth and solid operating margins, which are supported by its competitively well-positioned and relatively diversified BPO business portfolio. The stable outlook assumes that the likelihood of another potential leverage buy-out in the current market is low and that new business awards will improve due to renewed management focus on business fundamentals. Ratings confirmed /assessments revised: -- Corporate family rating, Ba2 -- $500 million Senior Secured Notes due 2010 and 2015, Ba2, LGD 4, 53% -- $1800 million Senior Secured Term Loan facility due 2013, Ba2, LGD 3, 43% -- $1000 million Senior Secured Revolving Credit Facility, Ba2, LGD 3, 43% Rating revised: -- Probability of default rating to Ba2 from Ba3 -- Rating assigned: -- Speculative grade liquidity rating of SGL-1 Headquartered in Dallas, Texas, ACS, with $5.9 billion LTM revenues during the twelve months ended Sept. 30, 2007, is a leading provider of business process outsourcing and I/T outsourcing to commercial clients as well as state and local governments. AMERICAN CAPITAL: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: American Capital Enterprises Corp. 12854 Stonebrook Drive Davie, FL 33330 Bankruptcy Case No.: 08-01007 Type of Business: The Debtor develops residential homes. Chapter 11 Petition Date: January 28, 2008 Court: Middle District of Florida (Fort Myers) Judge: Alexander L. Paskay Debtor's Counsel: David Marshall Brown, Esq. 33 Northeast 2nd Street, Suite 208 Fort Lauderdale, FL 33301 Tel: (954) 765-3166 Fax: (954) 765-3382 Total Assets: $1,000,000 Total Debts: $800,000 The Debtor does not have any creditors who are not insiders. AMERICAN HOME: Court Approves Muldoon Murphy as Special Counsel --------------------------------------------------------------- American Home Mortgage Investment Corp. obtained permission from the U.S. Bankruptcy Court for the District of Delaware that to employ Muldoon Murphy & Aguggia LLP as special counsel, nunc pro tunc to Dec. 15, 2007, in connection with the Debtors' sale of American Home Bank, a non-debtor subsidiary and a United States federally chartered thrift bank. James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, relates that the contemplated sale of the Thrift involves special and complex regulatory matters, which Muldoon Murphy specialized. He notes that the Thrift sale will require counsel, who is familiar with the federal banking and acquisition of control laws and the processes and procedures of the regulatory agencies that oversee the Thrift, the Office of Thrift Supervision and the Federal Deposit Insurance Company. As special counsel, Muldoon Murphy will: -- provide information and advise the Debtors with respect to the interpretation and application of the federal banking laws and regulations, including those relating to the acquisition of control of the Thrift; -- review and advise the Debtors with respect to the federal acquisition of control laws and regulations as applied to specific circumstances, including an analysis of any regulatory interpretations that might apply to those circumstances; and -- prepare and review, if requested, any regulatory notices or applications that may be required to facilitate the Thrift Sale and will serve as the Debtors' liaison with the banking regulators, including the OTS and the FDIC. Muldoon Murphy will be paid on an hourly basis, plus reimbursement of actual and necessary expenses. Muldoon Murphy's rates are subject to periodic adjustment to reflect economic and other conditions, Mr. Patton discloses. He informs the Court that the current hourly rates of (i) the firm's attorneys range from $215 to $495, and (ii) its paralegals range from $160 to $180. Muldoon Murphy's attorneys assigned to the Debtors are: Name Hourly Rate ---- ----------- Paul M. Aguggia $495 Christina M. Gattuso $415 Kelli Provenzano $215 Muldoon Murphy estimates that its fee, excluding disbursement and other charges, for its proposed services will be $75,000. However, that amount is meant only as an estimate, and the firm provides no guarantees as to the total amount of its fees. Christina M. Gattuso, Esq., a member of Muldoon Murphy, assures the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About American Home Mortgage Investment Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on March 3, 2008. (American Home Bankruptcy News, Issue No. 23, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: Maricopa County Wants Location of Assets Disclosed ----------------------------------------------------------------- The Maricopa County Treasurer complained with the U.S. Bankruptcy Court for the District of Delaware that American Home Mortgage Investment Corp.'s proposed plan of sale for each proposed auction of assets fails to provide the locations of the assets to be sold. The Maricopa County Treasurer asserted Claim No. 2211 for $5,395 in relation to its secured liens on certain personal property taxes. Maricopa County also notes that the Debtors' request fails to (i) adequately provide information regarding their intentions as to what they should do with unsold assets, and (ii) identify the locations of the assets that remain unsold. Before any transfer of the Debtors' personal property located in Maricopa County, Arizona, all taxes associated with each of the personal property must be paid in full, the Maricopa County Treasurer argues. Because interests continues to accrue on the obligations until they are paid in full, Maricopa County says that it should be immediately paid from all sale proceeds. Maricopa County, therefore, asks the Court to require the Debtors to: -- identify the location of the Assets in the Plan; and -- provide clear information regarding the Debtors' intentions regarding the Unsold Assets should DoveBid Inc., elect not to attempt to sell the Unsold Assets in a subsequent sale. Maricopa County further requests that its secured tax claims be immediately paid from the sale proceeds. About American Home Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on March 3, 2008. (American Home Bankruptcy News, Issue No. 23, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN HOME: U.S. Trustee Objects to Non-Performing Loans Sale ---------------------------------------------------------------- Kelly Beaudin Stapleton, the United States Trustee for Region 3, objects to American Home Mortgage Investment Corp. motion filed with the U.S. Bankruptcy Court for the District of Delaware to sell pools of mortgages in which borrowers are behind in their payments and owe $164,000,000 in principal on the loans. Ms. Stapleton relates that on Jan. 10, 2008, she was informed by the Debtors' counsel that the Debtors, after consulting with Bank of America, N.A., in its capacity as administrative agent, J.P. Morgan Chase Bank, N.A., and the Official Committee of Unsecured Creditors, have elected to abandon the open auction process described in their request in favor of a "sealed bid" process. "Putting the merits of the amended sale procedures aside, notice of the Debtors' revised procedures should be given to parties in interest and a new objection deadline should be established, given that the relief presently requested is materially different than the relief sought in the Motion," Ms. Stapleton tells the Court. Even with the move to a "sealed bid" process, the Debtors continue to seek authority to award an expense reimbursement to select bidders, Ms. Stapleton notes. She says that interested bidders will deliver "indicative" bids to the Debtors and the Debtors may award an expense reimbursement of up to $150 per loan for one bid in each of the three loan pools, provided that the expense reimbursement does not exceed 1% of the bid. The Debtors' proposal is materially different than the typical situation where a debtor-in-possession negotiates the terms of an asset purchase agreement with a "stalking horse" bidder, and seeks bid protections to draw other bidders to an open auction process, Ms. Stapleton contends. Under the procedures in the request, and the Debtors' revisions in the procedures, it is unclear how the protected bids will attract other bids or induce qualified bidders to put their best foot forward, she continues. Accordingly, Ms. Stapleton tells the Court that she leaves the Debtors to their burden to establish that the proposed expense reimbursement will benefit the bankruptcy estates, citing Calpine Corp. v. O'Brien Environmental Energy, Inc. (In re O'Brien Environmental Energy, Inc.), 181 F.3d 527 (3d Cir. 1999). About American Home Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expires on March 3, 2008. (American Home Bankruptcy News, Issue No. 23, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN LAFRANCE: Wants Court Approval on Cash Collateral Access ----------------------------------------------------------------- American LaFrance LLC asks the United States Bankruptcy Court for the District of Delaware for permission to use the cash collateral of its prepetition lenders. The authority to use cash collateral is necessary for the Debtor to maintain business relationships and confidence with vendors, suppliers and customers, to satisfy other working capital and operational needs, to meet ongoing business payroll disbursements, and to maintain employee morale, Christopher A. Ward, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, in Wilmington, Delaware, the Debtor's proposed local counsel, relates. Mr. Ward notes that prior to Jan. 28, 2008, the Debtor entered into a credit agreement with Patriarch Partners Agency Services, LLC, as administrative agent for a group of lenders, which provides: Category Aggregate Amount -------- ---------------- Term loans $37,000,000 Revolving credit facility 68,500,000 Delayed draw term loans 41,000,000 The Prepetition Credit Agreement will mature on Dec. 14, 2010. To secure its performance under the Prepetition Credit Agreement, the Debtor granted a first-priority lien and security interest in substantially all of its assets to the Prepetition Lenders. As of the bankruptcy filing date, the aggregate amount due to the Prepetition Lenders under the Prepetition Credit Agreement was $150,241,313 in unpaid principal and $4,225,767 in accrued but unpaid interest, plus all other fees, costs and obligations of the Debtor. As adequate protection for Prepetition Lenders' interests in the cash collateral, the Debtor proposes to grant the Prepetition Lenders valid perfected and unavoidable first-priority replacement liens in all of its properties and assets. If the replacement liens are insufficient, the Prepetition Lenders will be granted superpriority administrative expense status and all other benefits and protections allowable under Section 507(b) of the Bankruptcy Code, junior only in right to any superpriority claims granted to the DIP Lenders. The Debtor prepared a 13-week budget detailing its anticipated cash receipts and expenditures. A full-text copy of the Debtor's Cash Flow Forecast commencing as of the week ending Feb. 1, 2008, through and including the week ending May 1, 2008, is available for free at: http://researcharchives.com/t/s?2781 Headquartered in Summerville, South Carolina, American LaFrance LLC -- http://www.americanlafrance.com/-- is one of the oldest fire apparatus manufacturers and one of the top six suppliers of emergency vehicles in North America. Thee company filed for Chapter 11 protection on Jan. 28, 2008 (Bankr. D. Del. Case No. 08-10178). Ian T. Peck, Esq., and Abigail W. Ottmers, Esq., at Haynes and Boone LLP, is the Debtor's proposed Lead Counsel. Christopher A. Ward, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers LLP, is the Debtor's proposed local counsel. When the Debtor filed for protection against its creditors, it listed assets and liabilities of between $100 Million and $500 Million. The Debtor's exclusive period to file a plan expires on May 27, 2008. (American LaFrance Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN LAFRANCE: Wants Interim Approval on $10MM DIP Financing ---------------------------------------------------------------- American LaFrance LLC asks the United States Bankruptcy Court for the District of Delaware for authority to obtain postpetition financing of up to $10,000,000 on an interim basis, and $50,000,000 on a final basis, from Zohar CDO 2003-1 Limited, Zohar II 2005-1 Limited, Zohar III and Patriarch Partners Agency Services LLC, as agent for the DIP Lenders. American LaFrance LLC, tells the Court that it needs a reliable source of financing to alleviate potential cash flow difficulties that may arise with operations and reassure suppliers, customers, employees and taxing authorities of its continued viability during its Chapter 11 case. The Debtor anticipates using the proposed DIP Financing to fund its day-to-day operations and to preserve value of its bankrupt estate. The proceeds of the DIP Facility will be applied: * first, to permanently reduce the debt outstanding under the Prepetition Claim Documents, plus any accrued interest; and * second, to permanently reduced the debt outstanding under the DIP Credit Documents, plus any accrued interest. The DIP Obligations will be secured by all of the Debtor's properties and assets, including causes of action under Chapter 5 of the Bankruptcy Code. The payment of the DIP Loans will be subject to an interest per annum equal to LIBOR plus 8%. Priority and Liens All direct borrowings under the DIP Facility and the DIP Obligations will be at all times subject to the Carve-Out Expenses and will be, pursuant to Section 364 of the Bankruptcy Code: (a) entitled to superpriority claim status; (b) secured by valid and perfected first-priority liens superior to all other liens in all of the Debtor's unencumbered property as of the Petition Date; (c) secured by valid and perfected second-priority liens in all of the Debtor's property as of the Petition Date; and (d) secured by a senior valid and perfected liens in all of the Debtor's property, which are subject to the Prepetition Lenders' lien and the liens of other parties that are avoidable for any reason. Carve-Out The DIP Lenders' Superpriority Claim and Liens will be subject only to the right of the payment of the Carve-Out expenses, which are: (a) statutory fees payable to the U.S. Trustee pursuant to Section 1930(a)(6) of the Judicial and Judiciary Procedures Code; (b) fees payable to the Clerk of the Bankruptcy Court; and (c) unpaid and outstanding fees and expenses incurred as of the Petition Date and approved by the Court of (i) the professionals retained by the Debtor of up to $950,000; and (ii) the professionals retained by a statutory committee in the Debtor's cases of up to $200,000. Maturity Date The DIP Facility will mature on the earliest of: (i) May 1, 2008; (ii) the date the Debtor terminates the commitment of the DIP Lenders to make the Postpetition Loan; (iii) the date the DIP Agent terminates the commitment of the DIP Lenders to make the Postpetition Loan upon the occurrence of a Postpetition Default; (iv) the effective date of a confirmed plan of reorganization for the Debtor; or (v) the date on which the Bankruptcy Court approves the extension of any other credit facility to the Debtor. The DIP Facility is also subject to customary events of default, including failure of the Debtor to pay any principal of the DIP Loans as they become due and payable. Investigation Period Other than the Debtor, all parties-in-interest will have 60 days from the entry of a DIP Order to file a complaint with the Court, asserting a claim or cause of action arising out of the Prepetition Claim Documents, or otherwise challenging the validity and priority of the Prepetition Lenders' liens. The Debtor agrees to pay for all costs and expenses incurred by the DIP Agent in connection with the preparation, negotiation and execution of the DIP Credit Agreement. A full-text copy of the Debtor's DIP Credit Agreement is available for free at: http://researcharchives.com/t/s?2782 Absent immediate access to the postpetition financing, the Debtor asserts that it may be forced to cease operations immediately, which would cause significant harm to its creditors, employees and other parties-in-interest. "Such a sudden shutdown would materially impair the value of ALF's business in the event of a proposed sale or other disposition," Christopher A. Ward, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, in Wilmington, Delaware, the Debtor's proposed local counsel, says. About American LaFrance LLC Headquartered in Summerville, South Carolina, American LaFrance LLC -- http://www.americanlafrance.com/-- is one of the oldest fire apparatus manufacturers and one of the top six suppliers of emergency vehicles in North America. Thee company filed for Chapter 11 protection on Jan. 28, 2008 (Bankr. D. Del. Case No. 08-10178). Ian T. Peck, Esq., and Abigail W. Ottmers, Esq., at Haynes and Boone LLP, is the Debtor's proposed Lead Counsel. Christopher A. Ward, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers LLP, is the Debtor's proposed local counsel. When the Debtor filed for protection against its creditors, it listed assets and liabilities of between $100 Million and $500 Million. The Debtor's exclusive period to file a plan expires on May 27, 2008. (American LaFrance Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMERISOURCEBERGEN CORP: Earns $109 Mil. in Quarter Ended Dec. 31 ---------------------------------------------------------------- AmerisourceBergen Corporation reported that in its fiscal year 2008 first quarter ended Dec. 31, 2007, net income was $109.8 million on $17.3 billion total revenues. Net income for the quarter ended Dec. 31, 2006, was $122.1 million. Operating revenue in the quarter increased 3.5% to $16.2 billion. Fiscal First Quarter Highlights * Operating revenue of $16.2 billion, up 3.5%. * Net $0.04 per diluted share benefit from a $10 million litigation settlement and special items. * Cash used in operations of $101 million. * $311 million of share repurchases. "In the December quarter, we delivered solid performance in our core businesses in a quarter that was a tough comparison with last year, and we look forward to stronger performance for the remainder of the 2008 fiscal year," said R. David Yost, AmerisourceBergen's President and Chief Executive Officer. "With a seasonally strong March quarter ahead, our increased sales momentum over the remainder of the fiscal year and the ongoing benefit from our share repurchase program, we continue to expect fiscal year 2008 diluted earnings per share to be 13% to 20 percent ahead of last year, excluding PharMerica Long-Term Care and special items in fiscal 2007. Our balance sheet continues to be strong and our financial flexibility remains significant." Consolidated Results Consolidated operating income in the fiscal 2008 first quarter decreased 7% to $195.0 million, due primarily to the inclusion of $9.1 million of operating income in the previous year's first quarter from PharMerica LTC, which was spun off to shareholders in July 2007, and the disappointing performance of its workers' compensation business PMSI in this first quarter. Operating income was positively impacted by a $10 million settlement of litigation with a major competitor related to sales activities involving an independent retail group purchasing organization, as well as by $1.4 million representing the net positive impact from pharmaceutical manufacturer antitrust litigation and facility consolidation, employee severance and other costs. Fiscal Year 2008 Expectations "Remaining unchanged for fiscal year 2008, is our expected free cash flow in the range of $450 million to $525 million, which includes capital expenditures in the $125 million range, and our anticipated spending of $400 million to $500 million to repurchase our common shares," Mr. Yost said. PMSI Sale AmerisourceBergen is pursuing the sale of PMSI so that it can focus on its core pharmaceutical distribution and related services businesses. The company, which is being assisted by Citi, has solicited buyers and is currently reviewing initial bids for the business. About AmerisourceBergen Headquartered in Valley Forge, Pennsylvania, AmerisourceBergen Corporation (NYSE:ABC) -- http://www.amerisourcebergen.com/-- is one of the pharmaceutical services companies serving the United States, Canada and selected global markets. AmerisourceBergen's service solutions range from pharmacy automation and pharmaceutical packaging to pharmacy services for skilled nursing and assisted living facilities, reimbursement and pharmaceutical consulting services, and physician education. AmerisourceBergen employs more than 14,000 people. * * * To date, AmerisourceBergen still holds Moody's Investor Services' Ba1 long term corporate family and Ba1 probability of default ratings. The outlook is positive. BEAR STEARNS: S&P Maintains 'BB' Rating on Class II-B Certificates ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its ratings on all 14 classes of asset-backed certificates from Bear Stearns Asset Backed Securities Trust 2005-SD3. The affirmations reflect current and projected credit support percentages that are sufficient to support the certificates at the current rating levels. Monthly excess interest for this transaction has exceeded monthly net losses for both loan groups for each of the past six months. As of the December remittance, cumulative losses for series 2005-SD3 were 0.92% of the original principal balance, total delinquencies were 17.26% of the current principal balance, and severe delinquencies were 11.16% as of the December 2007 remittance period. A combination of subordination, excess spread, and overcollateralization provide primary credit support for this transaction. The collateral consists primarily of fixed- and adjustable-rate, scratch-and-dent mortgage loans, secured by first liens on one- to four-family residential properties. Ratings Affirmed Bear Stearns Asset Backed Securities Trust 2005-SD3 Asset-backed Certificates Class Rating ----- ------ I-A, II-A-1, II-A-1 AAA I-M-1, II-M-1 AA I-M-2, II-M-2 A I-M-3 A- I-M-4 BBB+ I-M-5, II-M-3 BBB I-M-6, II-M-4 BBB- II-B BB BERRY PLASTICS: S&P Retains Low-B Ratings on Captive Plastics Buy ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' first-lien and 'B' second-lien senior secured debt ratings on Berry Plastics Corp. S&P removed the first- and second-lien senior secured debt ratings from CreditWatch, where they were placed with negative implications on Jan. 3, 2008, following the company's announced acquisition of Captive Plastics Inc. Pro forma for the debt- financed acquisition, total debt (adjusted to include capitalized operating leases and unfunded postretirement liabilities) was about $3.9 billion at Sept. 29, 2007. "The ratings affirmation reflects our expectation that the issuance of additional debt to fund Berry's acquisition of privately held Captive Holdings Inc., parent of Captive Plastics Inc., will not diminish recovery prospects for the outstanding first- and second-lien debt in the post-acquisition capital structure," said Standard & Poor's credit analyst Liley Mehta. Berry has obtained financing commitments to fund the acquisition for about $500 million in cash, and expects it to close in the first quarter of 2008, subject to customary closing conditions. Captive manufactures blow-molded bottles and injection-molded closures for the food, health care, spirits, and personal care markets at 13 plants in the U.S. The rating on Berry Plastics Group Inc. reflects the company's highly leveraged financial profile, which offsets the company's fair business profile with large market shares in niche segments, a well-diversified customer base, and strong customer relationships. With about $3.5 billion in annual sales pro forma for the Captive acquisition, Berry ranks among the largest packaging companies in North America, with leading positions in both the rigid and flexible plastic packaging segments. BLACKBOARD INC: Earns $3.3 Million in 2007 Third Quarter -------------------------------------------------------- Blackboard Inc. reported net income of $3.3 million for the third quarter ended Sept. 30, 2007, compared to a net loss of $4.8 million for the third quarter of 2006. Non-GAAP adjusted net income for the third quarter of 2007, which excludes the amortization of acquisition-related intangible assets, net of taxes, was $6.6 million, compared to non-GAAP adjusted net loss of $846,000 for the third quarter of 2006. Total revenue for the quarter ended Sept. 30, 2007, was $61.6 million, an increase of 22.0% over the third quarter of 2006. Product revenues for the quarter were $54.0 million, an increase of 24.0% over the third quarter of 2006, while professional services revenues for the quarter were $7.6 million, an increase of 9.0% over the third quarter of 2006. "During the quarter, we realized strong revenue and earnings performance and generated operating cash flow in excess of $38.0 million," said Michael Chasen, chief executive officer and president of Blackboard Inc. "These results combined with our outlook for the fourth quarter put us on track to have another record year with revenue expected to exceed $237.0 million and cash flow of approximately $60.0 million. Our continued financial success is giving us the opportunity to invest more meaningfully in our business, particularly in ongoing product development and client support." Liquidity and Capital Resources At Sept. 30, 2007, the company had cash and cash equivalents totalling $208.0 million, as compared to $30.8 million at Dec. 31, 2006. The increase in cash and cash equivalents was primarily due to a convertible debt offering in which the company issued and sold $165.0 million aggregate of the 3.25% Convertible Senior Notes due 2027. The company used a portion of the proceeds to terminate and satisfy in full its existing indebtedness outstanding pursuant to the senior secured credit facilities agreement, entered into in connection with the acquisition of WebCT, of $19.4 million and to pay all fees and expenses incurred in connection with the termination. The Notes bear interest at a rate of 3.25% per year on the principal amount, accruing from June 20, 2007. Interest is payable semi-annually on January 1 and July 1, commencing on Jan. 1, 2008. The Notes will mature on July 1, 2027, subject to earlier conversion, redemption or repurchase. Balance Sheet At Sept. 30, 2007, the company's consolidated financial statements showed $493.3 million in total assets, $318.9 million in total liabilities, and $174.4 million in total 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?277c About Blackboard Inc. Headquartered in Washington D.C., Blackboard Inc. (Nasdaq: BBBB) -- http://www.blackboard.com/-- is a provider of enterprise software applications and related services to the education industry. Founded in 1997, Blackboard's software applications are used by colleges, universities, K-12 schools and other education providers, as well as textbook publishers and student-focused merchants that serve education providers and their students. * * * As reported in the Troubled Company Reporter on Jan, 16, 2008, Standard & Poor's Ratings Services said its ratings and outlook on Blackboard Inc. (B+/Positive/--) would not be affected by the company's announced acquisition of The NTI Group Inc., a provider of mass notification systems to schools, for $182 million, of which $132 million will be in cash and the remaining amount will be in common stock. CALPINE CORP: Gets $253.6MM Bid from FirstEnergy for Fremont Plant ------------------------------------------------------------------ Calpine Corporation and its affiliated debtors and debtors in possession has successfully completed a Court-approved bidding process for a partially completed power plant located in Fremont, Ohio (the Fremont Project). Pursuant to a sale auction held Jan. 28, 2008, Calpine received a high bid of $253.6 million from FirstEnergy Generation Corp. The high bid exceeds the initially proposed sale price of $124 million as established by an Asset Purchase Agreement dated Nov. 16, 2007 between Calpine and American Municipal Power -- Ohio, Inc. Calpine will seek final approval for the sale from the U.S. Bankruptcy Court for the Southern District of New York on Jan. 30, with closing anticipated to occur in February 2008. "The Fremont Project was determined to be a non-strategic asset in the context of our successful Chapter 11 restructuring," according to Robert P. May, Calpine's Chief Executive Officer. "We are extremely pleased with the bidding results for the divestiture of this asset and are now looking ahead to emerging from bankruptcy in the very near future as a stronger and more competitive power company." The Fremont Project is a partially completed natural gas-fueled power plant located in Fremont, (Sandusky County) Ohio. Fremont is a clean and highly efficient combined-cycle generating facility capable of generating 550- megawatts of baseload capacity and up to 700-megawatts of total capacity. Calpine initiated construction activities at the site in 2001 but subsequently placed the project on hold due to adverse market conditions. About Calpine Corporation Based in San Jose, California, Calpine Corporation (OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient, natural gas-fired and geothermal power plants. Calpine owns, leases and operates integrated systems of plants in 21 U.S. states and in three Canadian provinces. Its customized products and services include wholesale and retail electricity, gas turbine components and services, energy management and a wide range of power plant engineering, construction and maintenance and operational services. The company and its affiliates filed for chapter 11 protection on Dec. 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq., Kirkland & Ellis LLP, represents the Debtors in their restructuring efforts. Michael S. Stamer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. As of Nov. 31, 2007, the Debtors disclosed total assets of $18,212,000,000, total liabilities not subject to compromise of $11,024,000,000, total liabilities subject to compromise of $11,859,000,000 and stockholders' deficit of $4,675,000,000. On Feb. 3, 2006, two more affiliates, Geysers Power Company, LLC, and Silverado Geothermal Resources, Inc., filed voluntary chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 06-10197 and 06-10198). On Sept. 20, 2007, Santa Rosa Energy Center, LLC, another affiliate, also filed a voluntary chapter 11 petition (Bankr. S.D.N.Y. Case No. 07-12967). On June 20, 2007, the Debtors filed their Chapter 11 Plan and Disclosure Statement. On Aug. 27, 2007, the Debtors filed their Amended Plan and Disclosure Statement. Calpine filed a Second Amended Plan on Sept. 19, 2007 and on Sept. 24, 2007, filed a Third Amended Plan. On Sept. 25, 2007, the Court approved the adequacy of the Debtors' Disclosure Statement and entered a written order on September 26. On Dec. 19, 2007, the Court confirmed the Debtors' Plan. (Calpine Bankruptcy News, Issue No. 79; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported in the Troubled Company Reporter on Jan. 11, 2008, Moody's Investors Service assigned a B2 Corporate Family Rating and a B2 Probability of Default Rating to Calpine Corporation in conjunction with the company's plan to exit bankruptcy in early 2008. Moody's also assigned B2 to the company's $7.3 billion senior secured term loan and revolving credit facility, the majority of which will be used as the company's primary exit financing to help satisfy approximately $8.2 billion of secured and other claims to be settled in cash, as well as to pay other related expenses. The rating outlook for Calpine is stable. CARDIOVASCULAR DIAGNOSTIC: Voluntary Chapter 11 Case Summary ------------------------------------------------------------ Debtor: Cardiovascular Diagnostic Image P.O. Box 651068 Miami, FL 33265 Bankruptcy Case No.: 08-10900 Type of Business: The Debtor is a full-service, insured diagnostic facility, with three centrally located facilities. See http://www.cardiodximage.com/ Chapter 11 Petition Date: January 28, 2008 Court: Southern District of Florida (Miami) Judge: Robert A. Mark Debtor's Counsel: Eduardo A. Exposito, Esq. 10726 Northwest 58 Street Doral, FL 33178 Tel: (786) 336-8488 Estimated Assets: Unstated Estimated Debts: Unstated The Debtor did not file a list of its 20 largest unsecured creditors. CBA COMMERCIAL: S&P's Rating on Class M-8 Certs. Tumbles to 'D' --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on the class M-8 commercial mortgage pass-through certificate from CBA Commercial Assets 2005-1 to 'D' from 'CCC-'. The downgrade of the class M-8 certificate reflects a $292,995 principal loss to the outstanding principal balance of the security due to the liquidation of one asset that was with the special servicer, Midland Loan Services Inc. The 414 & 416 2nd St. asset had a total exposure of $427,855 and was secured by a 20-unit multifamily property built in 1920 in Yakima, Washington. According to the Jan. 25, 2008, trustee remittance report, the property was liquidated, resulting in a $312,200 realized loss to the trust. The remaining $19,205 portion of the realized loss was allocated to the unrated class M-9 certificate, reducing its principal balance to zero. CHIQUITA BRANDS: Reviews Capital Structure, Considers Refinancing ----------------------------------------------------------------- Chiquita Brands International Inc. is reviewing its capital structure. It is considering options including a potential amendment or refinancing of its senior secured credit facility and a convertible note offering, which is intended to lower the company's interest expense, extend maturities and provide additional covenant flexibility. The company's total debt at year end 2007 was $814 million, compared to $1.029 billion a year ago, with minimal mandatory principal repayment obligations during the next three years. The company remained in compliance with its covenants under its existing debt facilities at Dec. 31, 2007, and expects to remain in compliance. The company reported liquidity that included cash in excess of $70 million, compared to $65 million at year-end 2006, as well as $169 million of availability under its current revolving credit facility. The company remained in compliance with its covenants under its existing debt facilities at Dec. 31, 2007, and expects to remain in compliance with them. The current secured credit facility includes a Term Loan C, which had a balance outstanding of $326 million at Dec. 31, 2007, and a $200 million revolving credit facility used for seasonal working capital needs. As of Dec. 31, 2007, the revolving credit facility was undrawn and had availability of $169 million after outstanding letters of credit. As part of its proposed refinancing, the parent company, Chiquita Brands International Inc., may consider issuing convertible senior unsecured notes, the proceeds of which would be used to partially prepay the existing Term Loan C. In connection with the proposed refinancing, the company is seeking consent from holders of its 7-1/2% senior notes due in 2014, in order to amend the terms of the indenture under which the notes were issued. Consummation of the refinancing is subject to a number of market and other conditions. No assurance can be given that any such amendment or refinancing of the company's capital structure can or will be completed on terms that are acceptable to the company, if at all. About Chiquita Brands International Inc. Cincinnati, Ohio-based Chiquita Brands International, Inc. (NYSE: CQB) -- http://www.chiquita.com/-- markets and distributes fresh food products including bananas and nutritious blends of green salads. The company markets its products under the Chiquita(R) and Fresh Express(R) premium brands and other related trademarks. Chiquita employs approximately 25,000 people operating in more than 70 countries worldwide, including Belgium, Columbia, Germany, Panama, Philippines, among others. CHIQUITA BRANDS: Soliciting Consents to Amend Indenture Terms ------------------------------------------------------------- Chiquita Brands International Inc. disclosed solicitation of consents to amend the terms of the indenture for its 7-1/2% senior notes due 2014, in connection with a proposed refinancing of its senior credit facility that is intended to lower its interest expense, extend maturities and provide additional covenant flexibility. The purpose of the consent solicitation is to amend provisions in the indenture governing the Notes regarding the company's ability to incur certain liens. The record date for the consent solicitation is the close of business, New York City time, on Jan. 25, 2008. The consent solicitation will expire at 5:00 p.m., New York City time, on Monday, Feb. 4, 2008, unless extended. The company is offering a consent fee of $20 per $1,000 of principal amount of Notes to each holder of record as of the record date who has delivered a valid consent prior to the Expiration Time. The company's obligations to accept consents and pay a consent fee is conditioned, among other things, on the receipt of consents to the amendments from holders of at least a majority in aggregate principal amount of Notes, the consummation of a senior unsecured convertible indebtedness transaction raising gross proceeds of not less than $125 million on or before Feb. 15, 2008, and other conditions. Questions from holders regarding the consent solicitation or requests for additional copies of the Consent Solicitation Statement, the Consent Form or other related documents should be directed to the information agent for the consent solicitation: Global Bondholder Services Corporation Suite 723, 65 Broadway New York, NY 10006 Tel (866) 873-6300 (toll free) (212) 430-3774 (call collect) or Morgan Stanley & Co. Incorporated Solicitation Agent Tel (800) 624-1808 (toll free) About Chiquita Brands International Inc. Cincinnati, Ohio-based Chiquita Brands International Inc. (NYSE: CQB) -- http://www.chiquita.com/-- markets and distributes fresh food products including bananas and nutritious blends of green salads. The company markets its products under the Chiquita(R) and Fresh Express(R) premium brands and other related trademarks. Chiquita employs approximately 25,000 people operating in more than 70 countries worldwide, including Belgium, Columbia, Germany, Panama, Philippines, among others. CHIQUITA BRANDS: S&P's Ratings Unmoved by Capital Structure Review ------------------------------------------------------------------ Standard & Poor's Ratings Services said that its ratings and outlook on Chiquita Brands International Inc. (B-/Negative/--) remain unchanged following the company's announcement that it is reviewing its capital structure. Chiquita may amend or refinance its senior secured credit facility, and may issue a convertible note offering (of at least $125 million) to repay a portion of the existing term loan C ($326 million was outstanding at Dec. 31, 2007). In connection with the proposed refinancing, Chiquita is seeking consent from holders of the $250 million 7.5% senior notes due 2014 to amend the terms of the indenture. These actions are intended to reduce the company's interest expense, extend maturities, and provide additional covenant flexibility. The company was in compliance with covenants under its existing credit facility at Dec. 31, 2007, and expects to remain in compliance. Liquidity is currently adequate, with cash in excess of $70 million and $169 million available on the $200 million revolver (reflecting $31 million of letters of credit outstanding) at Dec. 31, 2007. S&P will review the company's capital structure and financing proposals when and if they occur. While Chiquita expects operating income to improve in 2008, the company continues to face a difficult operating environment that includes higher industry and other costs, such as fuel, raw product, materials and production. CLASS V FUNDING: Moody's Slashes Rating on $45 Mil. Notes to Ba1 ---------------------------------------------------------------- Moody's Investors Service downgraded ratings of five classes of notes issued by Class V Funding II, Ltd., and left on review for possible further downgrade ratings of four of these classes of notes. The notes affected by this rating action are: Class Description: $68,000,000 Class A-2A Second Priority Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Baa3, on review for possible downgrade Class Description: $68,000,000 Class A-2B Second Priority Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Baa3, on review for possible downgrade Class Description: $ 45,000,000 Class B Third Priority Secured Floating Rate Notes Due 2046 -- Prior Rating: Aa2, on review for possible downgrade -- Current Rating: Ba1, on review for possible downgrade Class Description: $ 7,000,000 Class C Fourth Priority Secured Floating Rate Notes Due 2046 -- Prior Rating: Aa3, on review for possible downgrade -- Current Rating: Ba2, on review for possible downgrade Class Description: $ 26,000,000 Class D Fifth Priority Mezzanine Secured Floating Rate Deferrable Notes Due 2046 -- Prior Rating: Baa2, on review for possible downgrade -- Current Rating: Ca The rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence on Jan. 22, 2008, as reported by the Trustee, of an event of default caused by a failure of the Class A/B/C Overcollateralization Ratio to be greater than or equal to the required amount pursuant Section 5.1(i) of the Indenture dated May 18, 2006. Class V Funding II, Ltd. is a collateralized debt obligation backed primarily by a portfolio of CDO securities. Recent ratings downgrades on the underlying portfolio caused ratings-based haircuts to affect the calculation of overcollateralization. Thus, the Class A/B/C Overcollateralization Ratio failed to meet the required level. As provided in Section 5.1 of the Indenture during the occurrence and continuance of an Event of Default, holders of Notes may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The severity of losses of certain tranches may be different, however, depending on the timing and choice of remedy to be pursued by certain Noteholders. Because of this uncertainty, the ratings assigned to Class A-2A, Class A-2B, Class B, and the Class C Notes remain on review for possible further action. CLAYTON HOLDINGS: Cooperates in New York AG's Probe on Banks ------------------------------------------------------------ Clayton Holdings Inc. has agreed to cooperate with the investigation of the office of the New York Attorney General on the role of banks in the current subprime mortgage market crisis, the Wall Street Journal reports. Attorney General Andrew Cuomo had issued subpoenaes to several due-diligence firms which included Clayton, the WSJ adds. The company has agreed to provide information as well as testimony. In return, the WSJ relates, the company would be immune from prosecution. Citing an interview with company chairman and CEO Frank P. Filipps, WSJ says that the company has submitted due-diligence reports it made to clients for the years 2005 to 2007. The probe, according to reports, aims to look in the issue of whether banks provided enough disclosures for investors, as well as credit rating agencies, on the loan packages offerd as securities. About Clayton Holdings Inc. Headquartered in Shelton, Connecticut, Clayton Holdings Inc., -- http://www.clayton.com/-- is an information and analytics company serving capital markets firms, lending institutions, fixed income investors and loan servicers with a full suite of information-based analytics, specialty consulting and outsourced services. Clayton's services include due diligence analytics, conduit support services, professional staffing, compliance products and services, credit risk management and surveillance and specialized loan servicing services. * * * As reported in the Troubled Company Reporter on Dec. 11, 2007, Moody's Investors Service downgraded Clayton Holdings Inc.'s senior secured bank credit facility and corporate family ratings to B1 from Ba3. The ratings remain under review for downgrade. Standard & Poor's Ratings Services revised its outlook on Clayton Holdings Inc. to negative from stable. Ratings on the company, including the 'B+' corporate credit rating, are affirmed. CLEAR CHANNEL: S&P Retains Negative CreditWatch on B+ Rating ------------------------------------------------------------ Standard & Poor's Ratings Services said its ratings on Clear Channel Communications Inc., including the 'B+' corporate credit rating, remain on CreditWatch with negative implications. S&P originally placed them on CreditWatch on Oct. 26, 2006, following the company's announcement that it was exploring strategic alternatives to enhance shareholder value. "The company's pending LBO, led by Thomas H. Lee Partners L.P. and Bain Capital Partners LLC, received FCC approval on Jan. 24, 2008," explained Standard & Poor's credit analyst Michael Altberg. The consummation of the merger is subject to certain conditions, including the divestiture of grandfathered radio stations, in approximately 42 markets, that no longer comply with FCC multiple ownership rules. Clear Channel expects to obtain $18.525 billion of new senior secured credit facilities and $2.6 billion of new senior unsecured notes in association with financing the merger. Upon close of the transaction, and barring any material changes due to the divestiture of certain assets or change in financing terms, S&P expects to lower Clear Channel's long-term corporate credit rating to 'B' from 'B+'. At the same time, S&P expects to lower its rating on the company's $6.32 billion of existing senior unsecured notes, or $4.9 billion assuming the successful tender of its 7.65% senior notes due 2010 and 8% senior notes due 2008 at its subsidiary, to 'CCC+' (two notches below the expected corporate credit rating) from 'B-'. Based on the company's proposed financing, it will roll over existing senior unsecured debt into the new capital structure, but this debt will be structurally subordinate to both proposed new bank debt and new senior unsecured notes. The new bank debt and the new senior unsecured notes will benefit from upstream operating company guarantees, while the existing senior notes will not. Revenue and EBITDA increased 5.5% and 4.8%, respectively, for the third quarter of 2007, as a 1% decline in radio revenue was more than offset by 14% growth in outdoor advertising. S&P is concerned about the negative secular trends facing the radio industry. S&P believes Clear Channel has the ability to slightly outperform the industry due to its significant geographic and format diversity, offering some insulation from economic downturn and providing advertisers with a broader distribution platform. Still, S&P believes that it will be increasingly difficult for the company to achieve meaningful EBITDA growth in the radio segment over the intermediate term. Growth fundamentals in outdoor advertising remain strong, and are not subject to the same competition that radio is from alternative media such as the Internet. S&P believes domestic outdoor operations may benefit as the penetration of digital displays grows, and international profitability may gradually increase with continued investments in emerging markets. S&P will continue to monitor developments surrounding the closing of the proposed merger, in addition to the company's progress in planned asset sales. At the time of closing, S&P expects to assign ratings to Clear Channel's proposed senior secured credit facilities and proposed new senior unsecured debt. CLEVELAND UNLIMITED: Moody's Cuts Corporate Credit Rating to Caa2 ----------------------------------------------------------------- Moody's Investors Service downgraded the rating for the secured bonds rating of Cleveland Unlimited Inc. (Revol) to Caa2 from Caa1. Moody's also downgraded Revol's corporate family rating to Caa2 from Caa1, its probability of default rating to Caa3 from B3, and changed the outlook to negative. The downgrades reflect heightened default risk, prospects for less than full recovery in a distress scenario, and weak liquidity. Revol's SGL-4 liquidity rating, which Moody's affirmed, continues to capture the latter factor. This action concludes the review commenced Nov. 15, 2007, following the company's disclosure of a potential restatement of financial results and Moody's view that Revol's operating prospects have deteriorated, contributing to weak fundamentals for its prior rating category. Revol has not filed financial statements for the September 2007 quarter and has not sought waivers from bondholders for this breach of the financial reporting covenant. The negative outlook incorporates concerns over the lack of reliable financial information, weak liquidity and the potential for further problems to emerge. A summary of this actions are: Cleveland Unlimited, Inc. -- Senior Secured Bonds, Downgraded to Caa2 from Caa1, LGD3, 35% -- Corporate Family Rating, Downgraded to Caa2 from Caa1 -- Probability of Default Rating, Downgraded to Caa3 from B3 -- Outlook, Changed To Negative From Rating Under Review The combination of the delinquent filing and weak liquidity increase default risk, contributing to the downgrade of the PDR rating to Caa3. Revol violated the financial reporting covenant in its indentures, and bondholders could accelerate the $150 million obligation (which the company does not have committed resources to satisfy). Even if the company secures waivers or becomes current with its filings, its liquidity position will nonetheless remain weak, which leaves it in a tenuous position to service current debt and payment obligations and continue the ordinary course of operations. With no committed external sources, Revol relies on its limited cash balance (approximately $24 million as of June 30, 2007) and internally generated cash. The company consumed approximately $20 million of cash (GAAP operating cash flow less capital expenditures) in the trailing twelve months through June 30, 2007, and its path to sustained free cash flow generation remains uncertain. Revol has recently curtailed capital expenditures to conserve cash, but Moody's does not consider the current trend sustainable. The potential restatement and filing delays will likely lead to higher professional and legal fees, exacerbating the weak liquidity position. The downgrade of the corporate family rating to Caa2 also incorporates weak fundamental performance, including slowing industry subscriber growth and continued high churn, which have contributed to Revol's inability to grow revenue and enhance margins as originally forecast. However, the higher corporate family rating (Caa2) relative to the Caa3 probability of default rating highlights Moody's view of higher than average recovery, based primarily on spectrum value (albeit likely insufficient to provide full recovery to debt holders). Management currently believes a restatement of its financial results is possible. The company has not provided updated financial information beyond its June 2007 quarterly report, nor has it provided any scope or magnitude of any potential restatement. The ratings and negative outlook incorporate this limited financial information. If the company does not provide additional clarity, Moody's will also evaluate the ability to maintain ratings. Revol has not replaced its Chief Financial Officer, who resigned in August 2007 (although the company retained the services of a financial consultant), and its previously appointed accounting firm has suspended its audit engagement until the completion of an investigation by the Audit Committee into various accounting matters. Based in Independence, Ohio, Cleveland Unlimited, Inc. is a provider of wireless telecommunications service in Ohio. Its revenue for the 12 months ended June 30, 2007, was approximately $130 million. COMUNITY LENDING: Court OKs Murray & Murray as Bankruptcy Counsel ----------------------------------------------------------------- ComUnity Lending, Inc. and L.E.S. Liquidation Inc. obtained permission from the U.S. Bankruptcy Court for the Northern District of California to employ Murray & Murray P.C., as their general bankruptcy counsel. Murray & Murray is expected to: a) provide aid and assistance in the administration of the their Chapter 11 case; b) advise the Debtors concerning their rights and responsibilities under the U.S. Bankruptcy Code; c) provide continued representation in all negotiations and proceedings involving creditors and other parties-in- interest; d) assist in the formulation of a disclosure statement regarding their Chapter 11 plan; e) assist in the formulation of a viable plan of reorganization; f) assist in the confirmation of a Chapter 11 plan; and g) represent the Debtors in all other legal aspects as necessary and appropriate. John Walshe Murray, Esq., a shareholder at Murray & Murray, told the Court that the firm's professionals bill: Designation Hourly Rate ----------- ----------- John Walshe Murray, Esq. $550 Law Clerks/Paralegals $150 Mr. Murray assured the Court that the firm is disinterested as that term is defined in Section 101(14) of the U.S. Bankruptcy Code. Mr. Murray can be contacted at: John Walshe Murray, Esq. Murray & Murray P.C. 19400 Stevens Creek Boulevard, Suite 200 Cupertino, CA 95014-2548 Tel: (650) 852-9000; (408) 907-9200 Fax: (650) 852-9244 http://www.murraylaw.com/ Based in San Jose, California, ComUnity Lending, Inc. -- http://www.comunitylending.com-- is a mortgage lender, with mortgage programs of up to $1,500,000. The company and its affiliate, L.E.S. Liquidation Inc., filed for Chapter 11 protection on Jan. 4, 2008 (Bankr. N.D. Calif. Case Nos. 08-50030 and 08-50031). John Walshe Murray, Esq. represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, ComUnity Lending listed estimated assets and liabilities of $10 million to $50 million. COMUNITY LENDING: Section 341(a) Meeting Scheduled for February 6 ----------------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of ComUnity Lending, Inc. and its debtor-affiliate's creditors on Feb. 6, 2008, at 10:30 a.m., at the Office of the U.S. Trustee, Room 130, 280 South First Street, in San Jose, California. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Based in San Jose, California, ComUnity Lending, Inc. -- http://www.comunitylending.com-- is a mortgage lender, with mortgage programs of up to $1,500,000. The company and its affiliate, L.E.S. Liquidation Inc., filed for Chapter 11 protection on Jan. 4, 2008 (Bankr. N.D. Calif. Case Nos. 08-50030 and 08-50031). John Walshe Murray, Esq. represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, ComUnity Lending listed estimated assets and liabilities of $10 million to $50 million. COUNTRYWIDE FIN'L: "Fear" May Have Prompted BofA Merger, WSJ Says ----------------------------------------------------------------- Fear of investigations by government regulators may have prompted Countrywide Financial Corp. to ink a deal with Bank of America Corp., James R. Hagerty and Joann S. Lublin of the Wall Street Journal reports citing people familiar with the situation. As reported in the Troubled Company Reporter on Jan. 15, 2008, the company signed a definitive agreement to sell its business to Bank of America Corporation in an all-stock transaction worth approximately $4 billion. Under the terms of the agreement, shareholders of Countrywide would receive .1822 of a share of Bank of America stock in exchange for each share of Countrywide. The company, WSJ adds, was facing probes from attorney-general offices in the states of California, Illinois and Florida for its lending practises. The company is also facing lawsuits by shareholders. About Countrywide Financial Based in Calabasas, California, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services residential and commercial loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. * * * As reported in the Troubled Company Reporter on Jan. 15, 2008, Moody's placed the ratings of Countrywide Financial Corporation and its subsidiaries under review for upgrade. CFC and Countrywide Home Loans senior debt is rated Baa3 and short-term debt is rated Prime-3. Countrywide Bank FSB's bank financial strength rating is C-, deposits are rated Baa1 and short-term debt Prime-2. All long and short-term ratings are placed under review for possible upgrade. COUNTRYWIDE FINANCIAL: CEO Gives Up Severance Pay of $37 Million ---------------------------------------------------------------- Countrywide Financial Corp.'s CEO, Angelo Mozilo, gave up his severance pay of approximately $37.5 million as he prepares to step out of the company, Alex Veiga of the Associated Press reports. Mozilo also forfeited various other benefits, and his annual compensation of $400,000, pursuant to an agreement to serve the company as a consultant after his retirement, says the AP. Still, the CEO will receive around $44.4 million in retirement benefits and deferred compensation from the company. Mozilo had been criticized recently over the size of the payout he would allegedly receive, in connection with Bank of America Corp.'s acquisition of the company. As reported in the Troubled Company Reporter on Jan. 15, 2008, the mortgage company signed a definitive agreement to sell its business to Bank of America in an all-stock transaction worth approximately $4.1 billion. However, the company said in a statement that Mozilo will not be receiving any payments relating to the acquisition. According to the AP, Mozilo's decision comes as inquiry over executive compensation intensifies at some of the nation's largest -- and troubled -- financial institutions. Damon Silvers, associate general counsel at an executive pay tracking institution, told the AP that by saying no to the severance benefit, Mozilo "seems to recognize that there's something wrong with this picture." Silvers was alluding to objections raised last year about the mortgage firm not disclosing its financial woes to investors, the AP relates. About Countrywide Financial Based in Calabasas, California, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services residential and commercial loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. * * * As reported in the Troubled Company Reporter on Jan. 15, 2008, Moody's placed the ratings of Countrywide Financial Corporation and its subsidiaries under review for upgrade. CFC and Countrywide Home Loans senior debt is rated Baa3 and short-term debt is rated Prime-3. Countrywide Bank FSB's bank financial strength rating is C-, deposits are rated Baa1 and short-term debt Prime-2. All long and short-term ratings are placed under review for possible upgrade. CYGNAL TECHNOLOGIES: Wants CCAA Protection Extended to March 21 --------------------------------------------------------------- Cygnal Technologies Corporation and its wholly-owned subsidiaries, Cygnal Technologies Ltd. and Accord Communications Ltd., working with their counsel, the Monitor and other interested parties, have finalized a joint plan of arrangement to be dated Jan. 29, 2008 and intend to file the Plan with the Ontario Superior Court of Justice in the Applicants' proceedings under the Companies' Creditors Arrangement Act. Cygnal also intends to seek orders from the Court to, among other things: (i) extend to March 21, 2008 the period of the Court-ordered stay of proceedings against the Applicants in their CCAA Proceedings; (ii) establish a further process to supplement the existing Court-ordered process by which certain creditors of the Applicants must prove their claims in the CCAA Proceedings; and (iii) set the date for the Applicants' creditor meetings to consider and approve the Plan. In addition, Cygnal disclosed that PricewaterhouseCoopers Inc. filed its third report to the Court. Plan of Arrangement If authorized by the Court, the Applicants intend to present the Plan to affected creditors for their consideration at the creditor meetings. The Applicants may at any time before and during the meetings of affected creditors amend, modify or supplement the Plan, provided that such amendments are made available to affected creditors at or prior to the meetings. The purpose of the Plan is to provide for the distribution of cash and, if applicable, promissory notes to affected creditors in compromise and settlement of their claims; the cancellation, in effect, of all existing common shares of Cygnal pursuant to articles of reorganization; and the issuance of new common shares in the capital of Cygnal to an affiliate of Laurus Master Fund, Ltd., Cygnal's principal secured lender, in consideration for the funds needed to make the cash distributions to affected creditors under the Plan. For the purposes of voting on the Plan, creditor claims will be divided into three classes: affected claims against Cygnal, affected claims against Cygnal Quebec and affected claims against Accord. At the effective time of the Plan, each affected claim will be compromised and thereafter each affected creditor will receive a distribution of cash and/or promissory notes on the following basis: an affected creditor may elect to receive (i) the lesser of the amount of its claim and $2,500, (ii) the amount of its pro rata share of approximately $1,947,553 (after payment of all Small Claim Amounts and subject to adjustment in certain circumstances), and (iii) 75% of its Pro Rata Share and a promissory note issued by the applicable Applicant in a principal amount equal to 75% of its Pro Rata Share. An affected creditor that fails to make an election will be deemed to have elected to receive, in the case of a claim of less than $25,000, the Small Claims Amount, and in the case of any other claim, its Pro Rata Share. Under the Plan, all of Cygnal's issued common shares and warrants and options to purchase common shares of Cygnal, that are outstanding immediately prior to the effective time of the Plan will, in effect, be cancelled without payment of any consideration. Implementation of the Plan is subject to the satisfaction of certain conditions, including approval of the Plan by affected creditors of each class; issuance of a sanction order by the Court; and arrangements having been made with Laurus to repay the Applicant's obligations under its pre-filing credit agreement with Laurus and the DIP term sheet. As soon as practicable after the satisfaction of the conditions, Cygnal will file articles of reorganization and seek to obtain a certificate of amendment with respect thereto. Under the terms of the Plan, Cygnal maintains the right to exclude one or both of Cygnal Quebec and Accord from the Plan, including if the affected creditors of either subsidiary do not approve the Plan. In that event, affected creditors of the applicable subsidiary will not receive any distribution under the Plan. As of the effective time, all affected creditors will be deemed to release the Applicants; the former and current directors, officers and employees of the Applicants; any person who might claim contribution or indemnification against or from the Applicants; and the current and former legal counsel and other professional advisors of the Applicants and each of their former and current directors, officers and employees from any claims relating to the Applicants, the Plan or the CCAA Proceedings. The Plan is the result of more than two months of review and analysis in which management has been assisted by the Monitor. Negotiations were held with various key parties, including representatives of Laurus and certain large affected creditors. Management has concluded that it is unable to identify any purchasers for the business or assets of the Applicants as an alternative to the Plan. The Board of Directors of Cygnal has reviewed the Plan and believes that it represents a fair and equitable treatment of the affected creditors of the Applicants given their relative priorities and the limited alternatives. The Board believes that if the Plan is not approved the likely result will be a liquidation of the Applicants' assets by a receiver and/or a trustee pursuant to the Bankruptcy and Insolvency Act (Canada). The Monitor has also confirmed that it is of the view that the alternative to implementation of the Plan is likely receivership or bankruptcy. In the Monitor's view, the Plan will produce a more favourable result, overall, for the affected creditors of the Applicants than a liquidation of Applicants' assets based upon a range of estimated recoveries. Monitor's Third Report The Monitor's Third Report informs the Court of the Monitor's and the Applicant's activities since the Monitor's report dated December 10, 2007. Copies of the Monitor's Third Report are available online at http://www.pwc.com/car-cygnal/ About Cygnal Technologies Based in Markham, Ontario, Cygnal Technologies Corporation (TSX: CYN) -- http://www.cygnal.ca/-- provides network communications solutions including the design, integration, installation, maintenance and management of wired and wireless solutions and networks. Cygnal supports end-user customers and business partners through 12 offices across Canada, including Vancouver, Edmonton, Calgary, Winnipeg, London, Burlington, Toronto, Ottawa, Montreal, Quebec City and Halifax. In November 2007, the Ontario Superior Court of Justice granted an Order under the Companies' Creditors Arrangement Act. DELPHI CORP: Court Allows Committee Participation in Exit Loan -------------------------------------------------------------- The Honorable Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York permits members of the Official Committee of Unsecured Creditors and the Official Committee of Equity Security Holders appointed in the bankruptcy cases of Delphi Corp. and its debtor-affiliates to participate in any syndicate of lenders assembled to provide exit financing facilities for the Debtors' emergence from Chapter 11. The Court directs all interested Statutory Committee members to: (a) to make advanced written disclosure of their participation in the Exit Loan Syndication to the Debtors, counsel to each of the Statutory Committees, and the U.S. Trustee; (b) withhold any information with his or her institution, or any lender or other party involved in the Exit Financing, related to the Debtors' or Statutory Committees' strategy regarding the Exit Financing; and (c) abstain from any direct negotiations with the Debtors or the Statutory Committees on the Exit Financing. Participating Statutory Committee members will be screened on an ongoing basis from any information relating to the Debtors' or the Statutory Committees' strategy regarding, and any deliberations by the applicable Statutory Committee in any respect thereon, the Exit Financing, Judge Drain rules. Nothing in the Court's order relieves any member of the Statutory Committees from its obligations under any applicable securities laws, Judge Drain clarifies. As reported in the Troubled Company Reporter on Jan. 9, 2008, the Debtors reduced their Exit Financing from the Court-approved $6.8 billion to $6.1 billion. The reduced facilities include: (a) $1.6 billion in an asset-backed revolving credit facility; (b) $3.7 billion in a first-lien term loan facility; and (c) $825 million in a second lien term loan facility. About Delphi Corp. Headquartered in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. (Delphi Bankruptcy News, Issue No. 108; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Jan. 16, 2008, Moody's Investors Service assigned ratings to Delphi Corporation for the company's financing for emergence from Chapter 11 bankruptcy protection: Corporate Family Rating of (P)B2; $3.7 billion of first lien term loans, (P)Ba3; and $0.825 billion of 2nd lien term debt, (P)B3. In addition, a Speculative Grade Liquidity rating of SGL-2 representing good liquidity was assigned. The outlook is stable. As reported in the Troubled Company Reporter on Jan. 11, 2008, Standard & Poor's Ratings Services expects to assign its 'B' corporate credit rating to Troy, Michigan-based automotive supplier Delphi Corp. upon the company's emergence from Chapter 11 bankruptcy protection, which may occur by the end of the first quarter of 2008. S&P expects the outlook to be negative. In addition, Standard & Poor's expects to assign these issue-level ratings: a 'B+' issue rating (one notch above the corporate credit rating), and '2' recovery rating to the company's proposed $3.7 billion senior secured first-lien term loan; and a 'B-' issue rating (one notch below the corporate creditrating), and '5' recovery rating to the company's proposed $825 million senior secured second-lien term loan. DELPHI CORP: Court Grants Final Approval of MDL Settlements ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York entered a final order on Jan. 25, 2008, approving the Multidistrict Litigation Settlements among the Debtors, General Motors Corp., and the lead plaintiffs in securities actions and lawsuits brought under the Employee Retirement Income Security Act consolidated before the U.S. District Court for the Eastern District Of Michigan, Southern Division. Pursuant to the MDL Settlements, the Debtors agreed to grant the Lead Plaintiffs and ERISA Plaintiffs claims under their First Amended Joint Plan of Reorganization. The Lead Plaintiffs are the holders of Section 510(b) Note Claims under the Plan, while the ERISA Plaintiffs are the holders of the Section 510(b) Equity Claims. In exchange, the Lead Plaintiffs and the ERISA Plaintiffs will release the Debtors from any and all claims in connection with the Securities Litigation. The Hon. Robert Drain authorizes the Debtors to release any and all of their claims against the current and former officers and directors of Delphi Corp. that relate to or arise out of any alleged violations of the federal securities laws during the period March 7, 2000, through March 3, 2005, inclusive. Judge Drain permits the Debtors and the other MDL Settlement parties to make nonmaterial modifications to the MDL Settlements without further Court order provided that the Official Committee of Unsecured Creditors and the Official Committee of Equity Security Holders do not lodge an objection to any proposed modification within five business days' notice. About Delphi Corp. Headquartered in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. (Delphi Bankruptcy News, Issue No. 109; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Jan. 16, 2008, Moody's Investors Service assigned ratings to Delphi Corporation for the company's financing for emergence from Chapter 11 bankruptcy protection: Corporate Family Rating of (P)B2; $3.7 billion of first lien term loans, (P)Ba3; and $0.825 billion of 2nd lien term debt, (P)B3. In addition, a Speculative Grade Liquidity rating of SGL-2 representing good liquidity was assigned. The outlook is stable. As reported in the Troubled Company Reporter on Jan. 11, 2008, Standard & Poor's Ratings Services expects to assign its 'B' corporate credit rating to Troy, Michigan-based automotive supplier Delphi Corp. upon the company's emergence from Chapter 11 bankruptcy protection, which may occur by the end of the first quarter of 2008. S&P expects the outlook to be negative. In addition, Standard & Poor's expects to assign these issue-level ratings: a 'B+' issue rating (one notch above the corporate credit rating), and '2' recovery rating to the company's proposed $3.7 billion senior secured first-lien term loan; and a 'B-' issue rating (one notch below the corporate creditrating), and '5' recovery rating to the company's proposed $825 million senior secured second-lien term loan. DELTA FINANCIAL: Court Approves De Minimis Assets Sale Procedures ----------------------------------------------------------------- Delta Financial Corp. and its debtor-affiliates obtained approval from the U.S. Bankruptcy Court for the District of Delaware, pursuant to procedures by which they may sell de minimis assets. The Debtors will sell some of the assets which are unnecessary for the continued operation of their businesses and are of relatively de minimis value compared to the total asset base. Proposed Procedures The De Minimis Sale Procedures will apply only to each asset whose cash and other consideration totals not more than $100,000. The Debtors will be allowed to sell assets that are encumbered by liens or encumbrances other interests only if those liens and other interests are capable of monetary satisfaction or the holders consent to the sale. The Debtors will be permitted to sell assets co-owned by a Debtors and a third party, only if the sale does not violate Section 363(h) of the Bankruptcy Code. After the Debtors enter into a contract or contracts contemplating a de minimis asset sale, the Debtors will serve a notice of the proposed sale to: 1. the U.S. Trustee for the District of Delaware; 2. counsel to any statutory committees appointed in the Chapter 11 cases; and 3. all known parties holding or asserting liens on or other interests in the assets that are subject of the proposed sale and their respective counsel, if known; otherwise referred as "interested parties." Interested parties will have 10 calendar days from the service of the sale notice to file and serve any objections to the sale. The Debtors will also file the notice with the Court. The sale notice will include: a. a description of the assets proposed to be sold and their locations; b. the identity of the non-debtor purchaser or other party or parties to the sale and any relationship with the Debtors; c. the identities of any parties holding liens on or other interests in the assets and a statement indicating that all the liens or interests are capable of monetary satisfaction; d. the major economic terms and conditions of the sale; and e. instructions consistent with the objection procedures. The Debtors may consummate a sale prior to expiration of the applicable notice period if the Debtors obtain each interested party's written consent. If any significant economic terms of a sale are amended after transmittal of the notice, but before the expiration of the notice period, the Debtors must send a revised notice to all the interested parties describing the proposed sale, as amended. If a revised notice is required, the notice period will be extended for an additional five calendar days. On or before the 15th day of every calendar month, the Debtors will file with the Court, and serve upon all parties requesting notice in the cases, a report summarizing any de minimis sale that were consummated during the immediately preceding calendar month. Each monthly report will include with respect to each of the sale: (i) a description of the assets proposed to be sold and their locations; (ii) the identity of the non-debtor purchaser or other party or parties to the sale and any relationship with the Debtors; (iii) the identities of any parties holding liens on or other interests in the assets and a statement indicating that all the liens or interests are capable of monetary satisfaction; and (iv) the major economic terms and conditions of the sale. Any objections to a sale must be in writing, filed with the Court and served on the interested parties and counsel to the Debtors to be received by all the parties before the end of the notice period. Each objection must specify its grounds. If an objection is properly filed: a. the objection will be deemed a request for a hearing which will be held at the next scheduled omnibus hearing