T R O U B L E D C O M P A N Y R E P O R T E R Monday, February 11, 2008, Vol. 12, No. 35 Headlines ADAM SEALE: Case Summary & 14 Largest Unsecured Creditors AEOLUS PHARMA: Posts $641,000 Net Loss in First Qtr. Ended Dec. 31 AMP'D MOBILE: Wants 20 Parties to Disgorge Past Payments AMP'D MOBILE: Sets Protocol to Resolve Preference Claims ARNOLD ESTEP: Case Summary & 18 Largest Unsecured Creditors ASSOCIATED ESTATES: Net Income Drops to $1MM in Qtr. Ended Dec. 31 AVISTA CORP: S&P Upgrades Preferred Stock Rating One Notch to 'BB' BLACKHAWK AUTOMOTIVE: Offers Workers $200,000 Bonus Pool BP METALS: Moody's Retains 'B1' Corp. Rating With Stable Outlook BUFFETS HOLDINGS: Wants Court to Clarify Creditors' Access to Info CABLEVISION SYSTEM: Moody's Lifts Corporate Family Rating to 'Ba3' CALPINE CORP: Inks New $7 Billion Credit Agreement With Banks CALPINE CORP: Court Approves Sale of Hillabee Project to CER CALPINE CORP: Closes $90 Million Blue Spruce Financing CAPROCK COMMS: Moody's Holds B2 Rating; Changes Outlook to Neg CENTURY INDEMNITY: Fitch's 'B-' IFS Rating Has Negative Outlook CENTURY REINSURANCE: Fitch Puts Neg. Outlook on 'CCC+' IFS Rating CHEMTURA CORP: Completes Fluorochemicals Business Sale to Du Pont CHRYSLER LLC: Has Plans to Cut Product Lines and Dealerships CHIQUITA BRANDS: Prices $175 Mil. Offering of 4.25% Senior Notes CINCINNATI BELL: Board Authorizes $150 Million Stock Repurchase CINCINNATI BELL: Moody's Keeps Rating on Plan to Buy Back Stock CINCINNATI BELL: S&P Changes Outlook to Stable; Keeps 'B+' Rating CINCINNATI BELL: Fitch Holds 'B+' IDR, Revises Outlook to Positive CITY CAPITAL: Fails to Include Promissory Note in Sept. Report CONEXANT SYSTEMS: Receives Nasdaq Stock Market's Notice Letter CONEXANT SYSTEMS: S&P Ratings Unmoved by Possible Nasdaq Delisting CONGOLEUM CORP: Bondholders and Asbestos Party OK Chapter 11 Plan CONGOLEUM CORP: Gets Delisting Notice From American Stock Exchange CORNERSTONE MINISTRIES: Case Summary & 20 Largest Unsec. Creditors CORRECTIONS CORP: Earns $133.4 Mil. for Fiscal 2007 Ended Dec. 31 COUNTRYWIDE FINANCIAL: Venture w/ KB Home Sued by Calif. Couples CYRUS REINSURANCE: Moody's Withdraws 'Ba1' Term Loan Rating DANA CORP: Wants Court to Expunge 307 Scheduled Claims DB ISLAMORADA: Court Approves $40,144 DIP Fund to Pay Insurance DB ISLAMORADA: Downrite Wants Case Converted to Chapter 7 DELPHI CORP: Court Allows 35 Trade Claims for $52,000,000 DELPHI CORP: Wants Lease Decision Period Extended Until May 31 DELPHI CORP: Proposal to Assign Steering Biz Contracts Disputed DELPHI CORP: Wants More Time to Remove Pending Civil Actions DIRECTV GROUP: FCC Chair Backs Liberty-News Corp. Stake Swap DOMENIC DESEI: Voluntary Chapter 11 Case Summary DR HORTON: Posts $128.8 Mil. Net Loss in Quarter Ended December 31 EDS CORP: Paying $0.05/Share Common Stock Dividend on March 10 EDUCATION MANAGEMENT: Earns $33.8 Million in Fiscal 2008 2nd Qtr. ELECTRICAL COMPONENTS: S&P Revises Outlook on Weak Credit Metrics FEDDERS CORP: Banks Want Court to Deny Panel From Filing Suit FGIC CORP: Discusses Bailout Deals with Calyon; Fitch Cuts Ratings FIRST MAGNUS: Several Creditors Balk at Liquidation Plan FIRST MAGNUS: Committee Defends Provisions of Liquidation Plan FIRST MAGNUS: Says Liquidation Plan Is Confirmable FLEXTRONICS INT'L: To Purchase FRIWO Mobile Business from CEAG AG FORTUNOFF: Wants Court's OK for FTI Consulting as Crisis Manager FORTUNOFF: Seeks Approval to Hire Logan & Company as Claims Agent FORTUNOFF: Wants to Pay Prepetition Wages and Benefits to Workers GEORGE LANNING: Case Summary & 19 Largest Unsecured Creditors HCA INC: Commences Tender Offer to Purchase $500 Million of Debt HEALTHSPORT INC: Elects Robert Kusher as Chief Executive Officer HOVNANIAN ENTERPRISES: Waivers of Compliance Last Until March 14 IMPERIAL SUGAR: Halts Operations After Sugar Refinery Fire INGEAR CORP: Case Summary & 20 Largest Unsecured Creditors INTERPUBLIC GROUP: Takes 49% Stake in New Advertising Company INTERSTATE BAKERIES: Wants to Grant Bonuses to 520 Top Employees JOURNAL REGISTER: S&P's 'B+' Rating on CreditWatch Negative JULIA HOOK: Case Summary & 20 Largest Unsecured Creditors KAR HOLDINGS: Moody's Holds B2 Corp. Rating on Weak Credit Metrics KB HOME: Joint Venture w/ Countrywide Sued by California Couples KELLWOOD CO: Sun Capital Advises Shareholders to Support Offering KOOSHAREM CORP: S&P Changes Outlook to Negative; Holds 'B' Rating LANIER HEALTH: S&P Rates Bonds 'BB+', Assigns Stable Outlook LB-UBS COMMERCIAL: Moody's Junks Rating on $11.751 Million Certs. LB-UBS COMMERCIAL: Moody's Confirms Low-B Ratings on Three Classes LIBERTY MEDIA: FCC Chair Supports Stake Swap Deal with News Corp. LID LTD: Files Amended Chapter 11 Plan of Reorganization LUXSAUNA INC: Case Summary & 19 Largest Unsecured Creditors MACKLOWE PROPERTIES: Friday's Talks with Lenders was Unfruitful MANCHESTER INC: Case Summary & 20 Largest Unsecured Creditors MANCHESTER INC: Dispute w/ Major Creditor Led to Bankruptcy Filing MATTHEW MISCZAK: Voluntary Chapter 11 Case Summary MBIA INC: Prices 82M Equity Offering at $12.15 per Share MONTCALM PUBLISHING: Case Summary & 20 Largest Unsecured Creditors MORRIS PUBLISHING: S&P Puts 'BB-' Corp. Rating on Negative Watch NATIONAL CENTURY: Noteholders Want Credit Suisse to Show Docs NATIONAL CENTURY: Bankruptcy Case Reassigned to Judge Hoffman NEW CENTURY: Court Allows Positive Software's Copyright Lawsuit NEW YORK RACING: Court Fixes Claims Bar Date to June 4 NEW YORK RACING: Wants Excl. Plan Filing Extended Until March 7 NEW YORK RACING: CEO Says Shutdown May Spur Layoff NOMURA CRE: Fitch Affirms 'B-' Rating on $12.825MM Class O Notes NOVASTAR FINANCIAL: Wachovia Default Waiver Expires Today PASCACK VALLEY: May Sell Operations at March 4 Auction PERFORMANCE TRANSPORTATION: Court Nods Committee's Access to Info PERFORMANCE TRANSPORTATION: Can Hire Imperial as Investment Banker PETER BORLO: Case Summary & Eight Largest Unsecured Creditors PHOENIX COS: Moody's Holds Ba2 Provisional Preferred Stock Rating PHOENIX COS: Discloses Intention to Spin Off Phoenix Investment PLASTECH ENGINEERED: Wants to Employ Donlin Recano as Claims Agent PRC LLC: Wants to Sell Real Property to Brett Houston for $2.2MM PROTECTED VEHICLES: Bankruptcy Follows Marines' Reduced Orders QUEBECOR WORLD: D.E. Shaw Claims 1.2% Stake Ownership at Jan. 28 QUEBECOR WORLD: Grosman Says Magazine Arm Unaffected by Bankruptcy RDR EMLEN: Voluntary Chapter 11 Case Summary ROOSEVELT HUBBARD: Case Summary & 13 Largest Unsecured Creditors SCOTT BURCH: Case Summary & Two Largest Unsecured Creditors SENTINEL MANAGEMENT: Bloom Given Time to Settle Lawsuit w/ Trustee SIRVA INC: Court Okays Request to Borrow $100M Under DIP Financing STAUNTON BUILDING: Voluntary Chapter 11 Case Summary TAMI GARVIN: Case Summary & 14 Largest Unsecured Creditors TAYLOR NURSING: Voluntary Chapter 11 Case Summary TOUSA INC: Taps Kurtzman Carson as Notice and Claims Agent TRANSDIGM GROUP: Earns $27 Million in First Quarter Ended Dec. 29 TRIPATH TECHNOLOGY: Judge Morgan Confirms Amended Chapter 11 Plan TWEETER HOME: Wants Court to Extend Plan-Filing Period to June 5 TYSON FOODS: Unit Finalizes Plan to Restructure Kansas Operations TYSON FOODS: Board Names New Officers, Forms Nominating Committee UNIFIED CAPITAL: Case Summary & Nine Largest Unsecured Creditors UNO RESTAURANT: S&P Cuts Ratings to CCC; Retains Negative Outlook US SHIPPING: Distributes $0.45 Per Unit for 2007 Fourth Quarter WACHOVIA BANK: Moody's Maintains Low-B Ratings on Five Classes * Fitch Says Credit Crunch in Leveraged Loan Market to Continue * Fitch Says Mat'l Costs Will Constrain Coal Producers' Earnings * S&P Says Newspaper Industry Credit Concerns Continue to Grow * Act to Protect Medical Debt Homeowners Introduced * New York Attorney General Investigates Rating Firms * BOND PRICING: For the Week of Feb. 4 - Feb. 8, 2008 ********* ADAM SEALE: Case Summary & 14 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Adam Peter Seale Kimberle Jean Seale aka Kimberle Jean Harris aka Kimberle Jean Ratts 32 Carnaby Drive Brownsburg, IN 46112 Bankruptcy Case No.: 08-01085 Type of Business: The Debtors own and manages Babbitt, L.L.C. and Madal Properties, L.L.C., both rental properties. Chapter 11 Petition Date: February 7, 2008 Court: Southern District of Indiana (Indianapolis) Judge: James K. Coachys Debtor's Counsel: Eric C. Redman, Esq. Bator, Redman, Bruner, Shive & Ludwig, P.C. 151 North Delaware Street, Suite 1106 Indianapolis, IN 46204 Tel: (317) 685-2426 Total Assets: $1,431,094 Total Debts: $1,645,915 Debtor's 14 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Northern Rock, P.L.C. Deficiency from $56,000 NE3 4PL Sale of Loft in Gos Forth, New Castle, UK England 4PL Chase Credit card $34,698 P.O. Box 94014 purchases Palatine, IL 60094-4014 Monroe Bank Deficiency from $16,000 210 East Kirkwood Avenue sale of 8820 East Bloomington, IN 47408 45th Street Indianapolis, IN Capital One Bank Credit card $13,898 purchases Citi Credit card $10,806 purchases CitiBank Business Credit Card $10,021 Purchases Lifetime Properties Business Debt $9,618 Lifetime Properties Business Debt $9,618 Chase Commercial Loan Unsecured commercial $8,047 loan Indianapolis Water Co. Business Debt $6,236 Citizens Gas Business Debt $5,128 Indianapolis Power and Light Business Debt $3,236 Cameron Meadows Home Owner Business Debt $680 Association American Express Credit card $249 purchases AEOLUS PHARMA: Posts $641,000 Net Loss in First Qtr. Ended Dec. 31 ------------------------------------------------------------------ Aeolus Pharmaceuticals Inc. disclosed Wednesday financial results for the three months ended Dec. 31, 2007. The company reported a net loss of $641,000 for the first quarter ended Dec. 31, 2007, compared to a net loss of $949,000 for the three months ended Dec. 31, 2006. "The company remains focused on research and development with studies underway to test AEOL 10150 as a protective agent against mustard gas exposure, to confirm AEOL 11207's potential as a treatment for Parkinson's disease, and to determine attractive candidates from our pipeline to address colitis and chronic obstructive pulmonary disease. We expect that these studies will yield very exciting results during the upcoming year," stated John L. McManus, president and chief executive officer. "We continue to see the benefits of our strategy to leverage our capital through research partnerships with academic institutions and government grants, and look forward to reporting progress on these initiatives over the next several months." Research and development expenses were lower in the first quarter of fiscal year 2008 when compared to the first quarter of fiscal 2007 as a result of a decline in employment, consulting and manufacturing costs. General and administrative expenses decreased in the first quarter of fiscal year 2008 compared to the first quarter of fiscal year 2007 as a result of a decline in employment costs and stock based compensation expense. As of Dec. 31, 2007, the company had $1,127,000 in cash and cash equivalents. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $1,293,000 in total assets, $606,000 in total liabilities, and $687,000 in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Dec. 31, 2007, are available for free at http://researcharchives.com/t/s?27de Going Concern Doubt Haskell & White LLP, in Irvine, California, expressed substantial doubt about Aeolus Pharmaceuticals Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Sept. 30, 2007, and 2006. The auditing firm reported that the company has suffered recurring losses, negative cash flows from operations and does not currently possess sufficient working capital to fund its operations throughout the next fiscal year. About Aeolus Pharmaceuticals Aeolus Pharmaceuticals, Inc. (OTC BB: AOLS.OB) -- http://www.aeoluspharma.com/-- is developing a variety of therapeutic agents based on its proprietary small molecule catalytic antioxidants, with AEOL 10150 being the first to enter human clinical evaluation. AMP'D MOBILE: Wants 20 Parties to Disgorge Past Payments -------------------------------------------------------- Amp'd Mobile Inc., filed complaints in the U.S. Bankruptcy Court for the District of Delaware against 20 entities, seeking to recover money or property, aggregating more than $10 million, with respect to certain transfers. The Debtor also seeks to avoid those Transfers. Steven M. Yoder, Esq., at Potter Anderson & Corroon LLP, in Wilmington, Delaware, states that the Debtor transferred amounts to its creditors on or within the 90-day period before the bankruptcy filing: Transferee Amount ---------- --------- Merrill Lynch, Pierce, Fenner & Smith, Inc. $4,051,051 Peter Adderton 1,150,000 Latham & Watkins LLP 1,040,602 MTV Networks on Campus, Inc. 754,909 Zuffa, LLC 701,469 U-Tek Digital Co, Ltd 655,300 The Perfect Connection, LLC 592,773 Wireless Toyz Franchise, LLC 371,359 Playboy Enterprises International, Inc. 361,000 DCI Marketing, Inc. 344,337 Hyperlink, Inc. 283,200 Manufacturers & Traders Trust Co 238,072 Uneka Concepts, Inc. 173,381 Robert Jones 147,500 The Dot Printer, Inc. 129,971 Wilson Sonsini Goodrich Rosati, P.C. 125,502 Cybersolon Japan, Inc. 87,312 Quality-1 Distributing, Inc. 60,718 Pump Audio, Inc. 46,675 GE Capital Financial, Inc. 2,826 "The Debtor was insolvent when the Transfers were made," Mr. Yoder notes. Mr. Yoder adds that the Transfers enabled the Transferees to receive more than they would have received if: (a) the Debtor's cases were administered under Chapter 7 of the Bankruptcy Code; (b) the transfers had not been made; and (c) the Transferees had received payment of those debts to the extent provided by the Bankruptcy Code. Thus, the Transfers are avoidable under Section 547(b) of the Bankruptcy Code, Mr. Yoder contends. Pursuant to Section 548(a)(1)(B) of the Bankruptcy Code, the Transfers can be avoided since the Debtor did not receive reasonably equivalent value in exchange for making the Transfers. Mr. Yoder relates that the Debtor is also entitled to recover the Transfers or the cash value of those transfers under Section 550(a) of the Bankruptcy Code. According to Section 502(d) of the Bankruptcy Code, if the Transferees hold claims against the Debtor, the Court should disallow the claims, because the Transferees have failed to pay the amount of the Transfers. The Debtor relates that it has made written demands to the Transferees for the return of the Transfers. The Transferees, however, failed or refused to return the Transfers, Mr. Yoder says. Hence, the Debtor was unnecessarily delayed in its recovery of those Transfers. According to Mr. Yoder, the Debtor is entitled to a grant of pre-judgment interest on the value of the Transfers from the date of the Debtor's demand letter until the entry of judgment in the complaints to compensate the Debtor for the delay arising from the Transferees' refusal to return the Transfers. About Amp'd Mobile Inc. Headquartered in Los Angeles, California, Amp'd Mobile Inc. aka Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual network operator that provides voice, text and entertainment content to subscribers who contract for cellular telephone service. The company filed for chapter 11 protection on June 1, 2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq., Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard Firm represent the Debtor in its restructuring efforts. Attorneys at Otterbourg, Steindler, Houston & Rosen, P.C. and Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, represent the Official Committee of Unsecured Creditors. In its schedules filed with the Court, the Debtor listed total assets of $47,603,629 and total debts of $164, 569,842. The Debtor's exclusive period to file a plan expired on Sept. 29, 2007. (Amp'd Mobile Bankruptcy News, Issue No. 23; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). AMP'D MOBILE: Sets Protocol to Resolve Preference Claims -------------------------------------------------------- Amp'd Mobile Inc. informed the U.S. Bankruptcy Court for the District of Delaware that its estate possesses approximately 200 preferential claims under Sections 547 and 550 of the Bankruptcy Code. If the Debtor is required to seek the court approval to serve notice on all interested parties whenever the Debtor resolves a preference claim, the expense to the estate and the demand on the Court's time will be considerable, Steven M. Yoder, Esq., at Potter Anderson & Corroon LLP, in Wilmington, Delaware, asserts. Thus, in order to efficiently resolve the Preference Claims, the Debtor asks the Court to establish: * a list of parties upon which the Debtor will serve notice of the Debtor's intent to settle a Preference Claim; * a procedure for the settlement of certain Preference Claims without notice; and * a procedure that would allow the Debtor to obtain Court approval of all other proposed settlements of a Preference Claim by serving a notice upon the Interested Parties therefore giving those parties the opportunity to object to the proposed settlement and to set a hearing of the objection. The list of parties upon which the Debtor propose to serve notices of certain proposed settlements are: * the U.S. Trustee, * counsel for the Unsecured Creditors' Committee, * general bankruptcy counsel for the Debtor, and * counsel for Kings Road Investment Ltd. Proposed Settlement Approval Process In instances where the total gross amount of all transfers does not exceed $75,000, the Debtor proposes that the Court grant it authority to settle the Preference Claims, without the need for any further notice, hearing or order of the Court. To the extent the Debtor desires to settle Preference Claims where the total gross exceeds $75,000, the Debtor will serve a notice of the Proposed Settlement. The Settlement Notice will include: * the amount of the Preference Claim; * the name of the party against whom the Claim has been asserted; * the dates of the payments in question; * the terms of the Proposed Settlement; * any asserted defenses to the Preference Claim; and * explanation for the Proposed Settlement. Interested Parties will have 15 days from the date of the Settlement Notice to object to the Proposed Settlement. If no objections are filed and served properly prior to the expiration of the Notice Period, the Proposed Settlement will be deemed approved by the Court without further notice and hearing. Moreover, the Debtor will be authorized to consummate the Proposed Settlement. Any objection to a Proposed Settlement must: (i) be in writing, (ii) state with specificity the ground for objection, (iii) be served on the Interested Parties and special counsel to the Debtor so as to be received prior to the expiration of the Notice Period, and (iv) be filed with the Court prior to the expiration of the Notice Period. If an objection to a Proposed Settlement is properly filed and served, then the Proposed Settlement may not proceed absent: (i) withdrawal of the objection; or (ii) entry of an order of the Court specifically approving the Proposed Settlement. If the parties are unable to resolve the objection, either of them will ask the Court to hold a hearing considering the Proposed Settlement. At least 10 days prior to the hearing, the objecting party of the Debtor must file a notice of hearing with the Court, serving the notice to the Interested Parties and special counsel for the Debtor. Moreover, on or before the 15th day of each month, the Debtor will provide to the Interest Parties a report describing the final disposition of all Preference Claims settled in the previous calendar month. The Monthly Settlement Report will identify: (i) the party against whom the claim was asserted, (ii) the amount of the Preference Claim, and (iii) the settlement amount. About Amp'd Mobile Inc. Headquartered in Los Angeles, California, Amp'd Mobile Inc. aka Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual network operator that provides voice, text and entertainment content to subscribers who contract for cellular telephone service. The company filed for chapter 11 protection on June 1, 2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq., Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard Firm represent the Debtor in its restructuring efforts. Attorneys at Otterbourg, Steindler, Houston & Rosen, P.C. and Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, represent the Official Committee of Unsecured Creditors. In its schedules filed with the Court, the Debtor listed total assets of $47,603,629 and total debts of $164, 569,842. The Debtor's exclusive period to file a plan expired on Sept. 29, 2007. (Amp'd Mobile Bankruptcy News, Issue No. 23; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). ARNOLD ESTEP: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------- Debtors: Arnold Eugene Estep aka Arnold Estep Sheila Marie Estep aka Sheila Estep 1123 Zinfandel Way San Jose, CA 95120 Bankruptcy Case No.: 08-50488 Chapter 11 Petition Date: February 6, 2008 Court: Northern District of California (San Jose) Judge: Arthur S. Weissbrodt Debtors' Counsel: Charles E. Logan, Esq. Law Offices of Charles E. Logan 95 South Market Street, Suite 660 San Jose, CA 95113 Tel: (408) 995-0256 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtors' list of their 18 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ ------------ --------- Internal Revenue Service $1,397,520 P.O. Box 21126 Philadelphia, PA 19114-0326 Franchise Tax Board $249,000 Attention: Special Procedures P.O. Box 2952 Sacramento, CA 95812-2952 Bank of America $11,784 P.O. Box 15026 Wilmington, DE 19850-5026 Amex Express (Blue) - Florida $10,595 American Express (Green) - Texas $10,499 HSBC $10,297 Household Credit Services $10,296 CitiCard $7,117 Wells Fargo Visa $6,685 Citibank Advantage $6,317 Marriott Vacation Club $5,291 Chase Mastercard $2,025 Office of the County Treasurer $578 William Lewis $340 Attorney General Notice Only Unknown Controller of State of Notice Only Unknown California County of Calaveras Notice Only Unknown County of Santa Clara Notice Only Unknown ASSOCIATED ESTATES: Net Income Drops to $1MM in Qtr. Ended Dec. 31 ------------------------------------------------------------------ Associated Estates Realty Corporation reported net income available to common shareholders of $1.1 million for the fourth quarter ended Dec. 31, 2007, compared with net income available to common shareholders of $12.1 million for the fourth quarter ended Dec. 31, 2006. "Our exceptional operating performance in 2007 is directly attributable to the strength of AEC's apartment markets, the competitiveness of each of our properties and our hardworking employees," Jeffrey I. Friedman, chairman, president and CEO, commented. For the twelve months ended Dec. 31, 2007, net income applicable to common shares was $5.1 million compared to net income applicable to common shares of $22 million for the period ended Dec. 31, 2006. Stock Repurchase During the year, the company repurchased 1,021,200 shares of the company's common stock for $13.6 million, at an average price of $13.30 per share. At the end of the year, $5.9 million remained available under the board authorized $50 million stock repurchase program. 2007 Acquisitions and Dispositions In 2007, the company purchased one property and acquired its joint venture partners' 51% interest in another property for a total of $91.3 million. In 2007, the company sold three properties for a total of $49 million. Net sales proceeds were primarily used to pay down debt, repurchase the company's common shares and fund capital improvement programs. About Associated Estates Realty Based in Richmond Heights, Ohio, Associated Estates Realty Corporation (NYSE: AEC) -- http://www.aecrealty.com/-- is a real estate investment trust and is a member of the Russell 2000 Index. The company directly or indirectly owns, manages or is a joint venture partner in 98 properties containing a total of 19,909 units located in 10 states. * * * Moody's Investor Service placed Associated Estates Realty Corporation's long term foreign and local issuer credit ratings at 'B+' on July 2007. The ratings still hold today with a stable outlook. AVISTA CORP: S&P Upgrades Preferred Stock Rating One Notch to 'BB' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised the corporate credit rating of Avista Corp. one notch to 'BBB-'. Senior unsecured ratings were bumped up to 'BBB-'; the preferred stock rating was moved up one notch to 'BB'. The company's short-term credit rating was also raised to 'A-3.' Under Standard & Poor's notching criteria, first mortgage bonds are not affected. The outlook is stable. "The rating action reflects Avista Corp.'s adequate general rate case settlement in Washington that provided it with a 9.4% increase for electric customers and a 1.7% increase for its natural gas customers, effective Jan. 1, 2008. This increase importantly updates Avista's test year using 2007 numbers and should assist in minimizing fuel and purchased-power cost deferrals, which have been ongoing issues for the company," said Standard & Poor's credit analyst Anne Selting. "The upgrade also reflects the company's sale of Avista Energy in June 2007, and our expectation that the company will be successful in filing future rate cases that will be needed to keep pace with rising capital expenditures and upward pressure on costs, including fuel and purchased power expense." While 2007 financial ratios are expected to be slightly weak for the rating, Standard & Poor's believes that financial improvements will be realized starting from 2008 and that the otherwise stable operations of the company warrant less weight on near-term financial performance. Performance has been hampered by losses at Avista Energy (on a gross margin and net income basis), which will not recur; a below-normal hydro year; an out-of-date test year in Washington and Idaho for electric power costs; and mild weather, which has lowered sales relative to expectations. Trailing 12- month results for consolidated operations (which include Avista Energy until June 30) are 15.8% fund from operations (FFO) to total debt, 3.0x FFO interest coverage, and an adjusted debt to total capitalization approaching 59%. However, Avista management expects poor hydro in both the third and fourth quarters will result in ratios that at year-end will be lower than these results. BLACKHAWK AUTOMOTIVE: Offers Workers $200,000 Bonus Pool -------------------------------------------------------- Blackhawk Automotive Plastics Inc. is proposing a $200,000 bonus pool to workers to keep them until the projected sale of its business by the end of March, Bill Rochelle of Bloomberg News reports. Blackhawk's chief executive officer, chief financial officer and chief restructuring officer won't participate in the bonus pool, according to the report. As reported by the Troubled Company Reporter on Dec. 18, 2007, the U.S. Bankruptcy Court for the Northern District of Ohio approved the bidding procedure proposed by Blackhawk Automotive Plastics Inc. for the public sale of its business. The sale is part of the Debtor's postpetition financing agreement with certain of its lenders. W. Y. Campbell & Company, the Debtor's investment banker, will serve as the Debtor's agent for the sale of the assets. The Debtor was scheduled to appear before the Court at a hearing Feb. 8, 2008, to seek approval of auction and sale hearing dates. An auction is expected to take place prior to an anticipated sale closing date of March 14, 2008. To participate in the auction, bids must be received by the sale agent before 5:00 p.m. (Eastern Time) on Feb. 29, 2008. Bids must accompany an earnest money cash deposit equivalent to five percent of the proposed purchase price but not to exceed $1.0 million. Qualifying bidders may then submit successive bids in increments of not less than $100,000. Salem, Ohio-based Blackhawk Automotive Plastics Inc., formerly Warren Molded/Custom Plastics, manufactures injection molded plastic products and motor vehicle parts and accessories. BAP's customers include General Motors, Delphi, Lear, Chrysler, Honda, Navistar, and Visteon. BAP employs about 1,574 workers domestically, and generated $136 million in sales in 2006. BAP owns Canadian subsidiary, Blackhawk Automotive Plastics Ltd. which operated a manufacturing facility in Ontario until Johnson Controls Inc. bought BAP Canada's assets in May 2005. BAP Canada's remaining assets consist primarily of net operating loss carryforwards for Canadian tax purposes. The NOLs had a book value of about $8.2 million as of December 2005. BAP also owns a plant in Upper Sandusky, Ohio, which ceased operations in 2006. The company filed for chapter 11 protection on Oct. 22, 2007 (Bankr. N.D. Ohio, Case No. 07-42671). Its parent company, Tier e Automotive Group Inc., filed a separate chapter 11 petition on the same day (Bankr. N.D. Ohio, Case No. 07-42673). Tier e acquired BAP from Worthington Industries Inc. in 1999. Tier e also owns 49% stake in Nescor Holdings Inc., a holding company for Nescor Plastics Corporation, also an automotive plastics supplier. William I. Kohn, Esq., David M. Neumann, Esq., Stuart A. Laven, Jr., Esq., at Benesch, Friedlander, Coplan & Aronoff LLP represent the Debtors in their restructuring efforts. Donlin Recano & Company Inc. provides the Debtors with claims, noticing, balloting and distribution services. The Debtors' schedules disclosed total assets of $58,665,229 and total liabilities of $51,244,592. As of bankruptcy filing, BAP's aggregate debt to its senior facility lenders was about $33 million. BP METALS: Moody's Retains 'B1' Corp. Rating With Stable Outlook ---------------------------------------------------------------- Moody's Investors Service affirmed the B1 corporate family rating and B1 probability of default rating of BP Metals LLC. In addition, the Ba3 rating of the first lien revolver and term loan as well as the B3 rating of the second lien term loan were affirmed. The outlook remains stable. The ratings affirmation reflects an expectation of continued strong financial metrics, which serves as a mitigant to cyclicality and pressures on the company's business segments from potential contraction in end-markets, operating challenges, and to a lesser extent cost inflation. BP Metals' consolidated performance remains in line with expectation. The ratings outlook is stable. However, negative rating pressure could result should there be a prolonged reduction in profitability and EBITDA relative to Moody's expectations, the inadequate or delayed coverage by insurance policies of losses and costs related to the temporary shutdown of a forging press at one of BP Metals' divisions, or the loss of customers related to the press failure. Moody's affirmed these ratings: -- B1 corporate family rating -- B1 probability of default rating -- Ba3 senior secured revolver (LGD 3 with a minor change to the rate to 41% from 42%) -- Ba3 first lien term loan (LGD 3 with a minor change to the rate to 41% from 42%) -- B3 second lien term loan (LGD 5 with a minor change to the rate to 87% from 86%) Through its operating subsidiaries, BP Metals is a manufacturer of custom engineered metal components for various end-markets including rail transportation, oil & gas, small gas engine, military/defense, truck and general industrial markets. Revenues for 2007 were approximately $354 million. BUFFETS HOLDINGS: Wants Court to Clarify Creditors' Access to Info ------------------------------------------------------------------ Buffets Holdings Inc. and its debtor-affiliates seek an order from the United States Bankruptcy Court for the District of Delaware clarifying that the Official Committee of Unsecured Creditors and other committees appointed under Section 1102(a) of the Bankruptcy Code are not authorized or required to provide the creditors they represent with access to the Debtors' confidential information. Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, proposed counsel for the Debtors, relates that as part of the Bankruptcy Abuse Prevention & Consumer Protection Act of 2005, Congress enacted a new section of the Bankruptcy Code. The new Section 1102(b)(3) states that a creditors' committee appointed under Section 1102(a) will "provide access to information for creditors who (a) hold claims of the kind represented by the committee; and (b) are not appointed to the committee." However, after receiving information from debtors, committees are required to execute confidentiality agreements. Ms. Morgan says that the enactment of Section 1102(b)(3)(A) raises the issue of whether an official committee could be required to share a debtor's confidential information with any creditor that the committee represents. Ms. Morgan explains that the New Section did not indicate how a creditors' committee should provide access to "information," and did not indicate the the nature, scope, or extent of the "information." She adds there appears to be no legislative history to the New Section that might shed light on the issues. Nonetheless, given the importance of the issue, the Debtors seek clarification that the Committees are not authorized or required to provide access to Confidential Information to any creditor that the Committee represents. Ms. Morgan tells the Court that when a statute is clear and unambiguous, "the sole function of the courts is to enforce it according to its terms". She points out that the Debtors are in a very competitive industry and dissemination of Confidential Information to parties who are not bound by any confidentiality agreement directly with the Debtors could be disastrous. "The relief requested does not mean that the Committees will not be providing information to its constituents," Ms. Morgan clarifies. The Committees will, through various means, make available to creditors a variety of public information concerning the Debtors, including pleadings, schedules and statements of financial affairs, and the Debtors' monthly operating reports. In addition, when it is time to vote on a plan, the Debtors will provide creditors with additional material information in a disclosure statement that satisfies the requirements of Section 1125(b). Headquartered in Eagan, Minnesota, Buffets Holdings Inc. -- http://www.buffet.com/-- is the parent company of Buffets, Inc., the nation's largest steak-buffet restaurant company, currently operates 626 restaurants in 39 states, comprised of 615 steak- buffet restaurants and eleven Tahoe Joe's Famous Steakhouse restaurants, and franchises sixteen steak-buffet restaurants in six states. The restaurants are principally operated under the Old Country Buffet, HomeTown Buffet, Ryan's and Fire Mountain brands. Buffets, Inc. employs approximately 37,000 team members and serves approximately 200 million customers annually. The company and all of its subsidiaries filed Chapter 11 protection on Jan. 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to 08-10158). The Debtors have selected Paul, Weiss, Rifkind, Wharton & Garrison LLP to represent them. Young Conaway Stargatt & Taylor, LLP, are the Debtors' proposed legal advisor and Houlihan Lokey Howard & Zukin Capital, Inc. and Kroll Zolfo Cooper LLC, their proposed financial advisors. The Debtors' balance sheet as of Sept. 19, 2007, showed total assets of $963,538,000 and total liabilities of $1,156,262,000. (Buffets Holdings Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) CABLEVISION SYSTEM: Moody's Lifts Corporate Family Rating to 'Ba3' ------------------------------------------------------------------ Moody's Investors Service upgraded to Ba3, from B1, the Corporate Family Ratings for Cablevision System Corporation and its wholly- owned indirect subsidiary Rainbow National Services LLC. The rating outlooks for both companies were also changed to Stable from Developing. This rating actions stem primarily from Moody's belief that the controlling shareholders and senior management are not currently considering another fiscally aggressive, going-private transaction (although the agency has not ruled out the possibility that they may do so in the future). Senior Vice President Christina Padgett noted that "difficult financial market conditions, including very tight credit and shareholder distaste for current valuations of cable companies, will likely preclude the Dolans from making a fourth run at taking the company private, even if they wanted to do so and thought that they could get it done at a lower price point." As a direct result, both companies are no longer as constrained as they had previously been with respect to such event risk. Moreover, the upgrades are supported by Moody's expectation of continued improvements in fundamental operating performance and key credit metrics over the forward rating horizon, notwithstanding heightened competitive pressure and uncertainty with respect to the magnitude of the potentially adverse impact from a lingering recessionary economic environment. In this regard, Senior Vice President Russell Solomon noted that "Cablevision continues to reap the benefits of having what are arguably the premiere assets in the cable TV business," adding that "the same things that have made them so successful operationally put them at perhaps the greatest risk to rapidly encroaching competition in the future, but they are well prepared and equipped to fight the coming fight." At the same time, however, Moody's lowered Cablevision's Speculative Grade Liquidity Rating to SGL-3 from SGL-2 given the company's near-term scheduled debt maturities ($500 million of notes due July 2008, plus $85 million of requisite term loan amortization payments throughout 2008), highly uncertain financial market conditions and a greater anticipated reliance on external sources of liquidity to satisfy the same. In contrast, Moody's raised Rainbow's SGL Rating to SGL-1 from SGL-2 due mainly to expectations of further improvements in internally generated cash flow. These summarizes the rating actions taken by Moody's: Cablevision Systems Corporation -- Corporate Family Rating: Upgraded to Ba3, from B1 -- Probability of Default Rating: Upgraded to Ba3, from B1 -- Senior Unsecured Regular Notes: Upgraded to B2 (LGD6 -- 93%), from B3 (LGD6 -- 93%) -- Speculative Grade Liquidity: Lowered to SGL-3, from SGL-2 -- Rating Outlook: Revised to Stable, from Developing CSC Holdings, Inc. -- Senior Secured Bank Credit Facilities: Upgraded to Ba1 (LGD2 -- 25%), from Ba2 (LGD2 -- 24%) -- Senior Unsecured Notes and Debentures: Upgraded to B1 (LGD5 -- 74%), from B2 (LGD5 -- 73%) -- Rating Outlook: Revised to Stable, from Developing Rainbow National Services LLC -- Corporate Family Rating: Upgraded to Ba3, from B1 -- Probability of Default Rating: Upgraded to Ba3, from B1 -- Senior Secured Bank Credit Facilities: Upgraded to Ba1 (LGD2 -- 23%), from Ba2 (LGD2 -- 24%) -- Senior Unsecured Notes: Upgraded to B1 (LGD4 -- 68%), from B2 (LGD4 -- 69%) -- Senior Subordinated Notes: Upgraded to B2 (LGD5 -- 89%), from B3 (LGD5 -- 89%) -- Speculative Grade Liquidity: Upgraded to SGL-1, from SGL-2 -- Rating Outlook: Revised to Stable, from Developing Headquartered in Bethpage, New York, Cablevision Systems Corporation is predominantly a domestic cable multiple system operator serving more than 3 million subscribers in and around the metropolitan New York area. Rainbow National Services LLC, headquartered in Jericho, New York, supplies television programming to cable television and direct broadcast satellite providers throughout the United States. The company predominantly operates three entertainment programming networks, American Movie Classics, WE: Women's Entertainment, and The Independent Film Channel. CALPINE CORP: Inks New $7 Billion Credit Agreement With Banks ------------------------------------------------------------- Calpine Corporation disclosed in a filing with the U.S. Securities and Exchange Commission that it has entered into credit agreements on the effective date of its Plan of Reorganization, dated January 31, 2008: (i) a senior secured term loan facility of $6,000,000,000, consisting of $3,900,000,000 of DIP financing converted to exit facility term loans, and $2,100,000,000 of additional exit facility term loans; and (ii) up to $1,000,000,000 senior secured revolving loan and letter of credit facility. The New Credit Agreement is provided by a syndicate of banks and other financial institutions led by Goldman Sachs Credit Partners L.P., Credit Suisse Securities (USA), LLC, Deutsche Bank Securities Inc., and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and joint bookrunners, Goldman Sachs, Credit Suisse, Deutsche Bank and Morgan Stanley, as co-documentation agents and as co-syndication agents, General Electric Capital Corporation, as sub-agent for the revolving lenders, and Goldman Sachs, as administrative agent and collateral agent. A full-text copy of the New Credit Agreement is available for free at: http://ResearchArchives.com/t/s?27df New Credit Facility Calpine will use the borrowings under the New Credit Facility to: -- fund distributions under the Plan, including the repayment of prepetition second lien debt; -- pay fees and expenses in connection with the New Credit Facility and the transactions occurring on the closing date of the New Credit Facility; and -- provide working capital and general corporate purposes. Borrowings under the New Credit Facility bear interest at a floating rate, which can be either a base rate, or at Calpine's option, a LIBOR rate, plus an applicable margin of 1.875% per annum in the case of the base rate loans, and 2.875% per annum in the case of the LIBOR loans. The term loan facility requires regularly scheduled quarterly payments of principal equal to 0.25% of the original principal amount of the term loan, with the remaining unpaid amount due and payable at maturity on March 29, 2014. Interest is payable on the last day of the applicable interest period but in no event less often than quarterly. Prepayments of the term loan facility made at Calpine's election, or required to be made from the proceeds of capital stock or debt issuances by us, in the first two years after the closing of the New Credit Facility will require the payment of a premium of: -- 2% of the principal amount repaid if repaid in the first year; and -- 1% of the principal amount repaid if repaid in the second year. Certain of Calpine's subsidiaries guarantees the company's obligations under the New Credit Facility. The New Credit Facility is secured by a security interest in substantially all of the assets of Calpine's and the Guarantors, and a pledge of the equity interests of the direct subsidiaries of each Guarantor. The New Credit Facility limits the ability of Calpine, the Guarantors and certain other subsidiaries to, among other things, incur or guarantee additional indebtedness, incur liens, pay dividends on or repurchase stock, make certain types of investments, restrict dividends or other payments from Calpine's direct or indirect subsidiaries, enter into transactions with affiliates, sell assets or merge with other companies, or change lines of business. The New Credit Facility also requires compliance with financial covenants that include (i) a maximum ratio of total net debt to EBITDA, (ii) a minimum ratio of EBITDA to cash interest expense, (iii) a maximum ratio of total senior net debt to EBITDA and (iv) maximum capital expenditures. Bridge Facility In addition to the New Credit Facility, Calpine borrowed up to $300,000,000 in senior secured bridge loans made available on the Effective Date pursuant to a bridge loan facility among Goldman Sachs, Credit Suisse Securities (USA), LLC, Deutsche Bank and Morgan Stanley, as joint lead arrangers and joint bookrunners, Goldman Sachs, Credit Suisse, Deutsche Bank and Morgan Stanley, as co-documentation agents and as co-syndication agents, and Goldman Sachs, as administrative agent and collateral agent. Calpine will use the Bridge Facility to finance, in part, the Plan. Borrowings under the Bridge Facility will bear interest at a base rate or a LIBOR rate, plus an applicable margin of: -- 1.875% per annum in the case of the base rate loans, and -- 2.875% per annum in the case of the LIBOR loans. The Bridge Facility will mature on January 31, 2009. The Bridge Facility will be prepaid with the net cash proceeds of certain identified asset sales and will be entitled to ratable prepayment with the New Credit Facility in the event of certain other mandatory prepayment events under the New Facility. The obligations of Calpine and its subsidiaries with respect to the Bridge Loan Agreement will be guarantied by the Guarantors and are secured by liens on the same collateral as the New Credit Facility, on a pari passu basis to the liens securing the New Credit Facility. A full-text copy of the Bridge Facility is available for free at: http://ResearchArchives.com/t/s?27e0 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. 81; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). CALPINE CORP: Court Approves Sale of Hillabee Project to CER ------------------------------------------------------------ The Hon. Burton R. Lifland of the United States Bankruptcy Court for the Southern District of New York authorized Calpine Corp. and its debtor-affiliates to sell the Hillabee Project, a partially completed power plant located near Alexander City, Alabama, to CER Generation, LLC, for $155,000,000, free and clear of all liens and encumbrances. CER Generation, a subsidiary of Constellation Energy, outbid a third party, Hillabee Acquisition Company, LLC, at the sale auction held February 5, 2008. CER Generation initially offered to buy the Project for $122,500,000 pursuant to an Asset Purchase Agreement dated December 21, 2007, with Calpine's Hillabee Energy Center, LLC affiliate. It raised its offer during the auction, topping Hillabee Acquisition's bid. The auction was held as part of Calpine's recently completed Chapter 11 restructuring. The sale remains subject to final regulatory approvals. The Debtors have determined that HAC will be a "Back-up Bidder." The Debtors will pay $6,400,000 as bidding incentive fee to HAC. The Debtors will also assume all contracts with Southern Company Services, Inc., and assign those contracts to the Buyer. The Debtors will pay $225,033 as cure amounts for the contracts. CER will also pay a $16,505 Cure Amount. The project is approximately 80% complete and expected to be operational in 2010 when construction and permitting are finalized. "The Hillabee Project was determined to be a non-strategic asset in the context of our recent Chapter 11 restructuring," said Robert P. May, Calpine's Chief Executive Officer. "We are extremely pleased with the success we have achieved with our strategic divestiture program and are now moving forward with one of the cleanest and most modern power generation fleets in the nation." The Hillabee Project is designed to be a clean and highly efficient 774-megawatt combined-cycle generating facility driven by two Siemens-Westinghouse 501G combustion turbines. Calpine initiated construction activities at the site in 2001 but subsequently placed the project on hold due to adverse market conditions. "The acquisition of the Hillabee facility is another example of our commitment to expanding beyond restructured competitive power markets into regulated markets in the South," said Thomas V. Brooks, president, Constellation Energy Resources and executive vice president, Constellation Energy. "We have a significant wholesale load serving business and a growing control area services and generation dispatch customer base in southern markets. The addition of this generation asset will complement our strong product and service offerings in this market. Our expertise and extensive background in building and operating generating facilities is well established." About Constellation Energy Constellation Energy -- http://www.constellation.com-- a FORTUNE 125 company with 2007 revenues of $21 billion, is the nation's largest competitive supplier of electricity to large commercial and industrial customers and the nation's largest wholesale power seller. Constellation Energy also manages fuels and energy services on behalf of energy intensive industries and utilities. It owns a diversified fleet of 78 generating units located throughout the United States, totaling approximately 8,700 megawatts of generating capacity. The company delivers electricity and natural gas through the Baltimore Gas and Electric Company (BGE), its regulated utility in Central Maryland. 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. 81; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). CALPINE CORP: Closes $90 Million Blue Spruce Financing ------------------------------------------------------ Calpine Corporation reported that its indirect subsidiary Blue Spruce Energy Center, LLC, has received funding for its $90,000,000 senior term loan refinancing, maturing December 31, 2017. Blue Spruce LLC owns the Blue Spruce Energy Center in Aurora, Colorado, and is a stand-alone, indirect subsidiary of Calpine. BSEC currently operates under a 10-year power contract with Public Service Company of Colorado for up to 310 megawatts of the power plant's full capacity and related energy and ancillary services. Power deliveries commenced in mid-2003 and extend through April 2013. Joint Lead Arrangers Co-Bank, ACB, and Siemens Financial Services, Inc., underwrote the project finance facility, and CoBank will serve as administrative agent. Net proceeds from the senior term loan will be used to refinance all outstanding indebtedness under the existing Blue Spruce LLC term loan facility, to pay fees and expenses related to the transaction and for general corporate purposes. This financing extends the tenor of the previous loan and is at a significantly lower interest rate. The benefits of the additional liquidity and lower interest expense flow through to Calpine. Calpine and other Calpine affiliates will not be responsible for the debts or other obligations of Blue Spruce LLC. 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. 81; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). CAPROCK COMMS: Moody's Holds B2 Rating; Changes Outlook to Neg -------------------------------------------------------------- Moody's Investors Service affirmed the B2 corporate family rating for CapRock Communications Inc. and revised the outlook to negative due to liquidity concerns (including elevated revolver usage relative to Moody's prior expectations) and heightened operational risk over the next twelve months. Moody's also downgraded the rating on the first lien secured bank facility to B1 from Ba3. This debt comprises the preponderance of the debt capital structure; the downgrade incorporates modest changes in the capital structure and is in accord with Moody's Loss-Given Default Methodology. Moody's could lower CapRock's ratings if debt-to-EBITDA (as per Moody's standard adjustments) remains above 5.5 times or free cash flow remains negative over the next 12 -- 18 months. A summary of this actions are: CapRock Communications Inc. -- Outlook, Changed To Negative From Stable -- Affirmed Corporate Family Rating, B2 -- Affirmed Probability of Default Rating, B2 -- Downgraded Senior Secured First Lien Credit Facility to B1, LGD3, 33% -- Affirmed Senior Secured Second Lien Term Loan, Caa1, LGD5, 83% CapRock's B2 corporate family rating continues to reflect the company's small scale, high customer concentration, elevated leverage and minimal free cash flow. The ratings are supported by blue-chip customers, significant barriers to entry, a healthy contract pipeline and good customer retention rates. CapRock Communications Inc. provides global fixed and mobile satellite communications in remote locations engineered at high levels of reliability. ABRY Partners acquired CapRock for approximately $200 million in February 2006. CENTURY INDEMNITY: Fitch's 'B-' IFS Rating Has Negative Outlook --------------------------------------------------------------- Fitch Ratings expects to assign an 'A' rating to the $300 million senior note issuance planned by ACE INA Holdings Inc., a subsidiary of ACE Limited. The new notes will be fully and unconditionally guaranteed by ACE and are therefore based on ACE's 'A+' Issuer Default Rating. On Dec. 17, 2007, Fitch affirmed all of its ratings on ACE and ACE's subsidiaries following the announcement by ACE that it will acquire CICA from Aon Corp. for $2.4 billion. The Outlook is Stable. Fitch expects ACE INA will use the proceeds to partially finance ACE's pending acquisition of Combined Insurance Company of America and its subsidiaries. Fitch anticipates that the remainder of the financing will be completed with a combination of $450 million of new bank debt in addition to roughly $1.65 billion of internal capital. Fitch believes that, following the completion of ACE's total financing plans, ACE's pro forma debt to capital ratio increase of roughly three points, to 15%, is still well within an acceptable level for ACE's current rating category. Fitch notes that ACE reported year-end 2007 earnings of $2.6 billion and stockholders' equity of $16.7 billion, an equity increase of 17% since year-end 2006. Fitch also notes that ACE, unlike many of its peers, has not repurchased shares during the current soft market. Fitch's ratings reflect its belief that ACE's capitalization will be materially unchanged by the acquisition, the integration risk derived from the acquisition will be reasonably well managed, and that CICA provides strategic benefits for ACE. The acquisition of CICA is expected to close during the second quarter of 2008, pending necessary regulatory approvals. Fitch has assigned these ratings: ACE INA Holdings Inc. -- $300 million senior notes 'A'. These ratings have a Stable Outlook: ACE Limited -- Issuer Default Rating at 'A+'; -- $575 million preferred stock at 'A-'. ACE INA Holdings Inc. -- IDR at 'A+'; -- $100 million senior debentures due 2029 at 'A'; -- $500 million senior notes due 2014 at 'A'; -- $500 million senior notes due 2017 at 'A'; -- $300 million senior notes due 2036 at 'A'. ACE Capital Trust II -- $300 Capital Securities due 2030 at 'A-'. ACE Bermuda Insurance Limited ACE Fire Underwriters Ins. Company ACE Indemnity Insurance Company ACE Insurance Company of Illinois ACE Insurance Company of the Midwest ACE Property and Casualty Insurance Company ACE Tempest Reinsurance Limited Atlantic Employers Insurance Company Bankers Standard Fire & Marine Company Bankers Standard Insurance Company Illinois Union Insurance Company Indemnity Insurance Company of North America Insurance Company of North America Pacific Employers Insurance Company Westchester Fire Insurance Company Westchester Surplus Lines Insurance Company -- Insurer Financial Strength Ratings at 'AA-'. These ratings have a Negative Outlook: Century Indemnity Company -- IFS at 'B-'. Century Reinsurance Company -- IFS at 'CCC+'. CENTURY REINSURANCE: Fitch Puts Neg. Outlook on 'CCC+' IFS Rating ----------------------------------------------------------------- Fitch Ratings expects to assign an 'A' rating to the $300 million senior note issuance planned by ACE INA Holdings Inc., a subsidiary of ACE Limited. The new notes will be fully and unconditionally guaranteed by ACE and are therefore based on ACE's 'A+' Issuer Default Rating. On Dec. 17, 2007, Fitch affirmed all of its ratings on ACE and ACE's subsidiaries following the announcement by ACE that it will acquire CICA from Aon Corp. for $2.4 billion. The Outlook is Stable. Fitch expects ACE INA will use the proceeds to partially finance ACE's pending acquisition of Combined Insurance Company of America and its subsidiaries. Fitch anticipates that the remainder of the financing will be completed with a combination of $450 million of new bank debt in addition to roughly $1.65 billion of internal capital. Fitch believes that, following the completion of ACE's total financing plans, ACE's pro forma debt to capital ratio increase of roughly three points, to 15%, is still well within an acceptable level for ACE's current rating category. Fitch notes that ACE reported year-end 2007 earnings of $2.6 billion and stockholders' equity of $16.7 billion, an equity increase of 17% since year-end 2006. Fitch also notes that ACE, unlike many of its peers, has not repurchased shares during the current soft market. Fitch's ratings reflect its belief that ACE's capitalization will be materially unchanged by the acquisition, the integration risk derived from the acquisition will be reasonably well managed, and that CICA provides strategic benefits for ACE. The acquisition of CICA is expected to close during the second quarter of 2008, pending necessary regulatory approvals. Fitch has assigned these ratings: ACE INA Holdings Inc. -- $300 million senior notes 'A'. These ratings have a Stable Outlook: ACE Limited -- Issuer Default Rating at 'A+'; -- $575 million preferred stock at 'A-'. ACE INA Holdings Inc. -- IDR at 'A+'; -- $100 million senior debentures due 2029 at 'A'; -- $500 million senior notes due 2014 at 'A'; -- $500 million senior notes due 2017 at 'A'; -- $300 million senior notes due 2036 at 'A'. ACE Capital Trust II -- $300 Capital Securities due 2030 at 'A-'. ACE Bermuda Insurance Limited ACE Fire Underwriters Ins. Company ACE Indemnity Insurance Company ACE Insurance Company of Illinois ACE Insurance Company of the Midwest ACE Property and Casualty Insurance Company ACE Tempest Reinsurance Limited Atlantic Employers Insurance Company Bankers Standard Fire & Marine Company Bankers Standard Insurance Company Illinois Union Insurance Company Indemnity Insurance Company of North America Insurance Company of North America Pacific Employers Insurance Company Westchester Fire Insurance Company Westchester Surplus Lines Insurance Company -- Insurer Financial Strength Ratings at 'AA-'. These ratings have a Negative Outlook: Century Indemnity Company -- IFS at 'B-'. Century Reinsurance Company -- IFS at 'CCC+'. CHEMTURA CORP: Completes Fluorochemicals Business Sale to Du Pont ----------------------------------------------------------------- Chemtura Corporation has completed the sale of its Fluorochemicals business and related production facility to E.I. du Pont de Nemours and Company in an all-cash deal for an undisclosed amount. "The sale is another step in our ongoing portfolio refinement initiative," Robert L. Wood, chairman and chief executive officer, said. "We are actively divesting non-core businesses and assets to enable us to better focus on our core businesses," Chemtura completed the divestiture of its organic peroxides business in May, its EPDM business in June and its optical monomers business in October 2007. The approximately 25 employees who work for the Fluorochemicals business have become employees of DuPont. The Fluorochemicals business had revenues for 2006 of approximately $56 million. Included in the sale is the Fluorochemicals production unit at Chemtura's El Dorado, Arkansas plant. Chemtura will retain ownership of its other El Dorado facilities. The company will record the sale in its first quarter, 2008 financial statements. About Chemtura Corporation Headquartered in Middlebury, Connecticut, Chemtura Corp. (NYSE:CEM) -- http://www.chemtura.com/-- is a manufacturer and marketer of specialty chemicals, crop protection, and pool, spa and home care products. The company has approximately 6,400 employees around the world and sells its products in more than 100 countries. The company has facilities in Singapore, Australia, China, Hong Kong, India, Japan, South Korea, Taiwan, Thailand, Brazil, Belgium, France, Germany, Mexico, and The United Kingdom. * * * As reported in the Troubled Company Reporter on Dec. 21, 2007, Moody's Investors Service placed Chemtura Corporation's corporate family rating of Ba2 under review for possible downgrade after reports that its "board of directors has authorized management to consider a wide range of strategic alternatives available to the company to enhance shareholder value." Standard & Poor's Ratings Services placed its 'BB+' corporate credit and senior unsecured debt ratings of Chemtura Corp. on CreditWatch with developing implications, after reports that management is considering strategic alternatives, including sale or merger of the company. CHIQUITA BRANDS: Prices $175 Mil. Offering of 4.25% Senior Notes ---------------------------------------------------------------- Chiquita Brands International Inc. has priced its offering of $175 million aggregate principal amount of 4.25% Convertible Senior Notes due 2016, $25 million more than previously disclosed. In addition, the company has granted the underwriters an overallotment option to purchase up to an additional $25 million principal amount of Notes. Chiquita expects this offering to close on Feb. 12, 2008, and intends to use the net proceeds from the offering to repay a portion of the outstanding amounts under the Term Loan C of its senior secured credit facility. The notes will pay interest semiannually at a rate of 4.25% per annum, beginning Aug. 15, 2008. The Notes will be convertible, under certain circumstances, at an initial conversion rate of 44.5524 shares of common stock per $1,000 in principal amount of the Notes, equivalent to an initial conversion price of approximately $22.45 per share of Chiquita common stock. This represents a premium of approximately 32.5% to the reported sale price of Chiquita's common stock on Feb. 6, 2008 of $16.94. The notes will be unsecured unsubordinated obligations of Chiquita Brands International Inc. and will rank equally with any unsecured unsubordinated indebtedness Chiquita may incur. Beginning Feb. 19, 2014, Chiquita may call the Notes for redemption if the common stock trades above 130% of the conversion price, or initially approximately $29.19 per share, for at least 20 of the 30 trading days preceding the redemption notice. The notes will be issued pursuant to an effective shelf registration statement, which was filed with the Securities and Exchange Commission. Goldman, Sachs & Co. and Morgan Stanley & Co. Inc. are the joint book- running managers for the offering. A prospectus relating to the offering may be obtained from: Goldman, Sachs & Co. Prospectus Department 85 Broad Street New York, NY 10004 Fax (212) 902-9316 Email prospectus- ny@ny.email.gs.com or Morgan Stanley & Co. Inc. Prospectus Department 180 Varick Street New York, NY 10014 Tel 1-866-718-1649 Email prospectus@morganstanley.com 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 International Inc. continues to carry Moody's Investors Service's 'B3' long term corporate family and 'Caa2' senior unsecured debt ratings which were assigned on Nov. 6, 2006. CHRYSLER LLC: Has Plans to Cut Product Lines and Dealerships ------------------------------------------------------------ Chrysler LLC intends to downsize certain aspects of its operations in order to match the market's demand for its products, Neal E. Boudette of the Wall Street Journal reports. For the auto-maker, this includes slashing the number of its product models and decreasing the number of dealers, WSJ cites company representatives in meetings with Chrysler's dealers. The Journal's Neal E. Boudette and Terry Kosdrosky relate that over the next three years or so, Chrysler plans to drop as many as half of the roughly 30 models it now produces, a move likely to cut sales at least for a while. Along the way, it expects a substantial consolidation in its network of 3,600 dealers, the Journal writers relate. According to people familiar with the issue, the adjustment is part of a strategy to trim the company to achieve healthy profits, which was a far cry from several years ago where it was aiming to double its sales volume, WSJ relates. Company executives acknowledged the fact that Chrysler "can't expect to increase its sales volume substantially," says WSJ. The company and its shareholders are considering solutions in order to contract the number of dealers, WSJ reports, citing a Chrysler spokesman. The company is currently rushing on finding a new supplier for its components. As reported in the Troubled Company Reporter on Feb. 8, 2008, Chrysler LLC CEO Robert Nardelli disclosed that the auto-maker is still in pursuit of its tooling equipment holed up at Plastech Engineered Products Inc.'s plants, and continues to seek component supplies from other vendors. About Chrysler LLC Based in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. CINCINNATI BELL: Board Authorizes $150 Million Stock Repurchase --------------------------------------------------------------- Cincinnati Bell Inc.'s board of directors has authorized the repurchase of its common shares in an amount up to $150 million over a two-year period. "Cincinnati Bell's financial condition has improved considerably over the past few years," Brian Ross, Cincinnati Bell's chief financial officer, said. "We have repaid debt, funded data center and wireless network expansions and are growing earnings." "We remain committed to further debt reduction and investment in our growth businesses," Mr. Ross added. "At the same time, our strong and stable cash flows enable us to repurchase our common stock, which we believe is an excellent value." "Our board of directors' action clearly demonstrates the strength of our financial condition, the return on recent investments, and the commitment to continue to deliver value to our shareholders," Mr. Ross continued. Cincinnati Bell expects to fund the share repurchase program with available free cash flow and execute its purchases either through the open market or private transactions. The timing, volume, and nature of share repurchases will be at the discretion of management, depending on market conditions, applicable securities laws, and other factors, and may be suspended or discontinued at any time. About Cincinnati Bell Headquartered in Cincinnati, Ohio, Cincinnati Bell Inc. (NYSE:CBB) -- http://www.cincinnatibell.com/-- provides integrated communications solutions, including local, long distance, data, internet and wireless services, that help keep residential and business customers connected with each other and with the world. In addition, businesses ranging in size from start-up companies to large enterprises turn to Cincinnati Bell for office communications systems, as well as information technology solutions, including data center and managed services. Cincinnati Bell conducts its operations through three business segments: wireline, wireless and technology solutions. In March 2007, the company purchased a local telecommunication business, which offers voice, data and cable television services, in Lebanon, Ohio. CINCINNATI BELL: Moody's Keeps Rating on Plan to Buy Back Stock --------------------------------------------------------------- Moody's Investors Service has affirmed Cincinnati Bell's Ba3 corporate family rating, the individual debt ratings and the SGL-1 rating, upon the Company's announcement that it will buy back up to $150 million in stock over the next 24 months. The outlook remains stable. CBB expects to fund the buyback with available free cash flow, although the Company may utilize the revolving credit facility to bridge the free cash flow timing. Moody's expects the periodic increases in borrowings to last through 2009, until the Company replenishes free cash flow to repay the revolver outstandings. The Company's overall credit profile is expected to remain stable, driven by improvements in its wireless and technology operations. The Company's Ba3 CFR reflects the company's relatively high leverage and its modest free cash flow in relation to total debt. The rating is supported by expected improvements in the wireless and technology segments. While CBB's high leverage is attributed to the company's prior acquisitions which performed below expectations, the company's capital expenditures in its wireless and technology segments will strain significant free cash flow generation over the rating horizon. In addition, Moody's anticipates the downward pressure on the company's free cash flow to persist due to continuing access line losses in CBB's incumbent wireline territories. Moody's Vice President and Senior Analyst, Gerald Granovsky, says that the stable outlook is based on expectations that CBB will maintain stable EBITDA over the rating horizon, as the rating agency expects the Company to offset the impact of access line losses in the company's incumbent wireline territories by operating improvements in the wireless and technology segments, increasing CLEC, data and broadband revenue, and managing the company's cost structure effectively. Moody's does not anticipate material debt reduction, given the expectations of modest free cash flow generation over the rating horizon. Cincinnati Bell Inc., with headquarters in Cincinnati, Ohio, provides telecommunications products and services to residential and business customers in Ohio, Kentucky and Indiana. CINCINNATI BELL: S&P Changes Outlook to Stable; Keeps 'B+' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Cincinnati, Ohio-based Cincinnati Bell Inc. to stable from negative. At the same time, S&P affirmed the 'B+' corporate credit rating and all other ratings. Debt outstanding as of Dec. 31, 2007, totaled about $2 billion. The outlook revision reflects better performance by the company's wireless unit, Cincinnati Bell Wireless, which along with growing contributions from CBI's technology solutions business, are expected to temper continued pressure on core wireline operations. Additionally, a recently announced workforce reduction plan is expected to partially mitigate losses associated with access line erosion and wireline price competition over the next few years. Although the company's decision to repurchase $150 million of stock during the next two years will slow financial profile improvement, S&P expects financial metrics to remain supportive of a 'B+' corporate credit rating. CBI's wireless business remains subject to strong competition from both national wireless providers and regional competitors such as Leap Wireless International Inc. However, the completion of its network upgrade to GSM technology in late 2006, and a better alignment of wireless plans led to solid revenue and EBITDA growth in 2007. Full year wireless revenues and adjusted EBITDA grew 12% and 39%, respectively, year-over-year, driven by 9% growth in postpaid subscribers, 15% increase in prepaid average revenue per subscriber and a strengthening EBITDA margin. "Despite the competitive environment, we expect CBI's wireless business to perform well enough to offset wireline segment losses over the next one to two years because of continued mid- to high- single digit subscriber growth, and stronger ARPU as investments in 3G network upgrades enable CBW to offer subscribers higher margin data services," said Standard & Poor's credit analyst Susan Madison. CBI's business profile also benefits from its investments in the outsourced IT infrastructure business in its which technology solutions business competes. For the full year 2007, technology solutions revenues and EBITDA totaled $258 and $27 million, respectively. While small compared to the consolidated company, contributions from this business help to offset the impact of declining revenues and EBITDA in CBI's wireline business. Moreover, S&P does not expect oversight of technology solutions to consume a disproportionate amount of management's time and attention. Capital needs, while high can be managed effectively by monitoring contract backlog and capacity use. CBI's core wireline operations remain a credit concern. Access line losses for its incumbent local exchange carrier Cincinnati Bell Telephone Co. (CBT; B+/stable/--) were high for the full year 2007 at 7.7%. To date, CBI has been successful in mitigating the negative impact of line losses on wireline revenue and EBITDA through growth in DSL services, and to a lesser extent through its competitive local exchange carrier operations. However, it will be more difficult to achieve growth going forward with DSL penetration reaching 42% at year end 2007. In response to this difficult business environment, CBI has focused on reducing costs, and recently announced a headcount reduction plan. This should help the company maintain wireline margins in the intermediate- term despite aggressive competition. If wireline operations stabilize because of moderating access line losses and continued cost reductions, wireless growth exceeds S&P's expectations, and CBI is able to reduce debt to EBITDA to the low 4x area, the outlook could be revised to positive. Conversely, the outlook could be revised to negative if accelerating line losses over the next one to two years, coupled with weak wireless performance caused debt to EBITDA to approach the mid-5x area. Negative financial performance would be accelerated if the company did not curtail its share repurchase program in the face of declining operating performance. CINCINNATI BELL: Fitch Holds 'B+' IDR, Revises Outlook to Positive ------------------------------------------------------------------ Fitch Ratings has affirmed Cincinnati Bell Inc.'s Issuer Default Rating rating at 'B+', and has revised its Rating Outlook to Stable from Positive. In addition, Fitch has affirmed other ratings as listed at the end of this release. Fitch's revision of its Rating Outlook to Stable from Positive reflects the Feb. 7, 2008 announcement of CBB's two-year, $150 million stock repurchase program. Fitch believes the Positive Outlook is no longer warranted, as previously expected delevering may now take longer to materialize than previously expected. The Stable Outlook is supported by the relative stability in its integrated wireline and wireless business model and operational improvements related to its wireless business. The affirmation of CBB's 'B+' IDR reflects expectations for stable performance and the lower level of business risk associated with the company's business model which integrates the local exchange and wireless businesses. Historical free cash flow levels have been strong as measured by free cash flow margin. Fitch notes that recent demand-driven data center expenditures and 3rd generation wireless spending have reduced free cash flow levels, but free cash flow is expected to improve significantly in 2008. In addition, CBB has moderately higher leverage relative than its peer group. CBB's strategy focuses on defending and growing its local exchange, wireless and data center businesses. In 2007, some delevering occurred, in line with CBB's strategy to reduce debt. In 2007, debt declined $63.5 million from year-end 2006. Revenue in 2007 grew 6.2% over the prior year to $1.349 billion, owing to 12.4% growth in the wireless segment and 19.3% growth in the technology solutions segment. In 2007, wireline revenues, including data, constituted 60% of revenues, wireless generated 21% of revenue, and the technology solutions business also produced 19% of revenue. Competitive pressure in the wireline business caused a 5.9% decline in total access lines year-over- year. To protect the 17% of revenue derived from consumer wireline voice services, CBB has been aggressively bundling wireless and high-speed data services with its wireline voice services into a package CBB refers to as a 'super bundle.' As of the end of 2007, approximately 38% of the consumer households in its incumbent local exchange carrier operating territory subscribed to a super bundle, up from 32% at year-end 2006. CBB's 'BB-' senior unsecured rating reflects the subordination to the company's senior secured debt and the Cincinnati Bell Telephone Co. notes. At the end of 2007, the capital structure reflected approximately $546 million in CBT notes, secured CBB notes and credit facility debt that was senior to CBB's senior unsecured debt. The notching of the senior secured debt above the senior unsecured debt is indicative of the anticipated recovery by the senior secured debt holders and their first-priority claim on the economic interests of CBT and CBW. CBB reported total debt outstanding of $2.010 billion at the end of 2007, a decrease of $63.5 million from year-end 2006. As of the end of 2007, $167.9 million of its $250 million secured revolving credit facility was available. CBB has no major maturities until the revolver matures in 2010, and the significant quarterly installments on the term loan do not start until the fourth quarter of 2011. In 2007, CBB reduced the tranche B term loan by $184 million. Of this amount, $75 million came from borrowings from an $80 million accounts receivable securitization program and the remainder from available cash. The receivables facility, which lowered its overall cost of financing, expires in March 2012. Investors should note that CBB's 7-1/4% notes due in 2013 will be callable beginning in July 2008. The notes contain a restricted payments test, which will limit the common stock repurchase program. CBB's guidance calls for the company to generate approximately $150 million in free cash flow in 2008, a significant increase over the $59 million in 2007. Fitch affirmed these ratings: Cincinnati Bell, Inc. -- IDR 'B+'; -- Senior secured credit facility 'BB+/RR1'; -- $50 million senior secured notes 'BB+/RR1'; -- $721 million senior notes 'BB-/RR3'; -- $637 million senior subordinated notes 'B/RR5'; -- $129 million convertible preferred stock 'B-/RR6'. Cincinnati Bell Telephone; -- IDR 'B+'; -- $230 million senior unsecured notes 'BB+/RR1'. CITY CAPITAL: Fails to Include Promissory Note in Sept. Report -------------------------------------------------------------- City Capital Corp. disclosed to the Securities and Exchange Commission, that on Jan. 29, 2008, the officers of the company concluded that the previously issued financial statements for the quarter ended Sept. 30, 2007, should no longer be relied upon because of the company's failure to report a promissory note in the principal amount of $70,000. According to the company, the promissory note is payable to Lucian Development LLC, a New York limited liability company which owns approximately 40.0% of the company's outstanding common stock. The note matures on Sept. 13, 2009, with the principal to be paid at maturity in one lump sum. The note accrues interest at the rate of 16.0%. Interest is to be paid in an annual amount of $11,200 payable in quarterly dispersements of $2,800 beginning Dec. 31, 2007. The Dec. 31, 2007, payment was not made resulting in a 2.0% penalty on the interest payment. Lucien Development has not given the company Notice of Default or accelerated the maturity date. The Troubled Company Reporter reported on the company's 2007 third quarter results of operations on Nov. 27, 2007. Going Concern Doubt As reported in the Troubled Company Reporter on April 24, 2007, De Joya, Griffith & Company LLC, in Henderson, Nevada, expressed substantial doubt about City Capital Corporation's ability to continue as a going concern after auditing the company's financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's recurring losses from operations and negative cash flows. About City Capital Headquartered in Franklin, Tennessee, City Capital Corp. (OTC BB: CTCC) -- http://www.citycapitalcorp.net/-- acquires and renovates distressed properties in multiple industry segments, reselling them at a profit. CONEXANT SYSTEMS: Receives Nasdaq Stock Market's Notice Letter -------------------------------------------------------------- Conexant Systems Inc. reported that it received a letter from the Nasdaq Stock Market dated Jan. 30, 2008, notifying the company that for the last 30 consecutive business days, the bid price of the companys common stock closed below the minimum $1.00 per share requirement for continued inclusion under Marketplace Rule 4450(a)(5). In accordance with Marketplace Rule 4450(e)(2), the company will be provided 180 calendar days, or until July 28, 2008, to regain compliance. In order to regain compliance, the bid price of the companys common stock must meet or exceed $1.00 per share for at least 10 consecutive business days before expiration of the 180-day period. The notification has no effect on the listing of Conexants stock at this time, and the company intends to take the actions required to regain compliance. About Conexant Headquartered in Newport Beach, California, Conexant Systems Inc. (NASDAQ:CNXT) -- http://www.conexant.com/-- develops, designs and sells semiconductor system solutions, comprised of semiconductor devices, software and reference designs in broadband communications applications for transmission, processing and distribution of audio, video, voice and data throughout homes and business enterprises. The access solutions connect people, through personal communications access products, such as personal computers and television set-top boxes to audio, video, voice and data services over wireless and wire line broadband connections, as well as dial-up Internet connections. The media processing products enable the capture, display, storage, playback and transfer of audio and video content in applications throughout home and small office environments. CONEXANT SYSTEMS: S&P Ratings Unmoved by Possible Nasdaq Delisting ------------------------------------------------------------------ Standard & Poor's Ratings Services said that its ratings on Newport Beach, California-based Conexant Systems Inc. (B- /Stable/--) are not affected by Conexant's notification that its stock will be delisted from NASDAQ Stock Market Inc. if its per- share value should fail to exceed $1.00 for a period of 10 consecutive days prior to July 28, 2008. Standard & Poor's has left the current ratings unaffected because the company's plan to execute a reverse stock split shortly after its annual shareholders meeting, to be held on Feb 20, 2008, should result in a stock price above the $1.00 threshold. Additionally, there could be trading options other than a NASDAQ listing that meet the trading requirement. If Conexant's common stock were to cease trading, the holders of its $250 million in 4.00% convertible notes would have the right to force the redemption of the notes. Given Conexant's current liquidity, such a request would ultimately trigger a payment default of both the convertible notes and the company's $275 million in floating rate senior secured notes. A combination of various cure periods could allow up to a year before a potential acceleration. CONGOLEUM CORP: Bondholders and Asbestos Party OK Chapter 11 Plan ----------------------------------------------------------------- The Official Committee of Bondholders and the Committee of Asbestos Claimants in Congoleum Corp.'s Chapter 11 cases have agreed to support the Debtors' amended plan of reorganization, Bankruptcy Law 360 reports. As reported in the Troubled Company Reporter on Jan. 21, 2008, Congoleum's amended Chapter 11 reorganization plan was filed by the future claimants' representative in its Chapter 11 proceedings. If the plan is approved by the court and accepted by the requisite creditor constituencies, it will permit Congoleum to exit Chapter 11 free of liability for existing or future asbestos claims. Under the terms of the amended plan, a trust will be created that assumes the liability for Congoleum's current and future asbestos claims. That trust will receive the proceeds of various settlements Congoleum has reached with a number of insurance carriers, and will be assigned Congoleum's rights under its remaining policies covering asbestos product liability. The trust will also receive 50.1% of the newly issued common stock in reorganized Congoleum when the plan takes effect. Holders of Congoleum's $100 million in 8.625% senior notes due in August 2008 will receive on a pro rata basis $80 million in new 9.75% senior secured notes that mature five years from issuance. The new senior secured notes will be subordinated to the working capital facility that provides Congoleum's financing upon exiting reorganization. In addition, holders of the $100 million in 8.625% senior notes due in August 2008 will receive 49.9% of the common stock in reorganized Congoleum. Congoleum's obligations for the $100 million in 8.625% senior notes due in August 2008, including accrued interest -- which amounted to $44.6 million at Dec. 31, 2007 -- will be satisfied by the new senior secured notes and the common stock issued when the plan takes effect. Under the terms of the amended plan, existing Class A and Class B common shares of Congoleum will be cancelled when the plan takes effect and holders of those shares, including the current controlling shareholder American Biltrite will not receive anything on account of their cancelled shares. Congoleum expects existing management will continue post-reorganization. A hearing to consider the adequacy of the disclosure statement describing the plan is scheduled for Feb. 14, 2008. About Congoleum Corp. Based in Mercerville, New Jersey, Congoleum Corporation (AMEX:CGM) -- http://www.congoleum.com/-- manufactures and sells resilient sheet and tile floor covering products with a wide variety of product features, designs and colors. The company filed for chapter 11 protection on Dec. 31, 2003 (Bankr. N.J. Case No. 03-51524) as a means to resolve claims asserted against it related to the use of asbestos in its products decades ago. Richard L. Epling, Esq., Robin L. Spear, Esq., and Kerry A. Brennan, Esq., at Pillsbury Winthrop Shaw Pittman LLP, and Paul S. Hollander, Esq., and James L. DeLuca, Esq., at Okin, Hollander & DeLuca, LLP, represent the Debtors. At March 31 2007, Congoleum reported $180,091,000 in total assets and $226,990,000 in total liabilities, resulting in a stockholders' deficit $46,899,000. The Asbestos Claimants' Committee is represented by Peter Van N. Lockwood, Esq., and Ronald Reinsel, Esq., at Caplin & Drydale, Chtd. The Bondholders' Committee is represented by Michael S. Stamer, Esq., and james R. Savin, Esq., at Akin Gump Strauss Hauer & Feld LLP. Nancy Isaacson, Esq., at Goldstein Isaacson, PC, represents the Official Committee of Unsecured Creditors. R. Scott Williams, Esq., of Haskell Slaughter Young & Rediker, LLC, the Court-appointed Futures Claimants Representative, is represented by Roger Frankel, Esq., Richard Wyron, Esq., and Jonathan P. Guy, Esq., at Orrick Herrington & Sutcliffe LLP, and Stephen B. Ravin, Esq., at Forman Holt Eliades & Ravin LLC. American Biltrite, Inc. (AMEX: ABL), which owns 55% of Congoleum, is represented by Matthew Ward, Esq., Mark S. Chehi, Esq., Christopher S. Chow, Esq., and Matthew P. Ward, Esq., at Skadden Arps Slate Meagher & Flom. CONGOLEUM CORP: Gets Delisting Notice From American Stock Exchange ------------------------------------------------------------------ Congoleum Corporation has received notice from the American Stock Exchange LLC that it no longer complies with the Amex's continued listing standards and that the Amex is initiating immediate delisting proceedings. The notice from the Amex stated that the determination was based on three reasons. First, the Amex will normally consider suspending dealings in, or removing from the list, securities of an issuer when advice has been rec