T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, February 13, 2008, Vol. 12, No. 37 Headlines ACE AVIATION: Earns $1.13 Billion in Quarter Ended December 31 ADAM AIRCRAFT: Suspends Colorado Biz Over Failure to Secure Funds ALLEGHENY TECH: S&P Upgrades Corporate Credit Rating From 'BB+' AMC ENT: Posts $11.2 Mil. Net Loss in 3rd Quarter Ended Dec. 27 AMERICAN HOME: Court Sets February 26 as Loan Sale Bid Deadline AMERICAN TECHNOLOGIES: Inks Agreement with Laurus on Note Default ARAMARK CORP: S&P Keeps 'B+' Corp. Rating on High Leverage Profile ASARCO LLC: U.S. Government Wants Late-Filed EPA Claim Allowed ASARCO LLC: Can Employ Filardi as Local Counsel ASARCO LLC: Can Hire Paul Ruh at A&M LLC as Bankruptcy Controller BALLANTYNE RE: Losses Cue S&P to Junk Ratings on Two Sub Debts BEAR STEARNS: S&P Chips Rating on Class B Certs. to BB From BBB BLOUNT INT'L: Sept. 30 Balance Sheet Upside-Down by $78.1 Million BOHUMIR MARIK: Voluntary Chapter 11 Case Summary BOISE CASCADE: Aldabra 2 Stockholders Approve Merger Deal BOISE CASCADE: S&P Designates 'BB' Rating on Negative CreditWatch BON-TON STORES: Moody's Cuts Corp. Rating to B2 on 2007 Weak Sales CAMPBELL RESOURCES: Nuinsco Provides $1.5 Mil. Revolving Facility CATALYST PAPER: Inks Sale of Snowflake Mill With AbitibiBowater CATALYST PAPER: S&P Ratings Unaffected by $161 Million Merger Deal COHR HOLDINGS: Moody's Alters Outlook to Negative; Holds B2 Rating COMMERCIAL MORTGAGE: Stable Performance Cues Fitch to Hold Ratings DELPHI CORP: Lenders Have Problems Syndicating $6.1 Billion Loan DELTA FINANCIAL: Committee Taps Landis Rath as Delaware Counsel DELTA FINANCIAL: Committee Taps Weiser LLP as Financial Advisor DOMAIN INC: To Hold Bankruptcy Liquidation Sale DOMAIN INC: Taps Dreier LLP as General Bankruptcy Counsel DOMAIN INC: Taps Saul Ewing as Delaware Bankruptcy Counsel DOMAIN INC: U.S. Trustee Appoints 7-Member Creditors Committee DOMAIN INC: Section 341(a) Creditors' Meeting Set for Feb. 26 DURANT CDO: Moody's Gives Junk Ratings on Four Classes of Notes ENCORE ACQUISITION: Completes Sale of Oil Properties to OLLC ENESCO GROUP: Plan Confirmation Hearing Deferred to February 13 ETHANEX ENERGY: Inks $220 Mil. Purchase Deal w/ Midwest Renewable FINLAY ENTERPRISES: 94 Stores Closes Due to Macy's Restructuring FINLAY ENTERPRISES: Quarter Sales Increase 24.1% to $383.4 Mil. FINLAY ENT: Closure of 94 Stores Won't Affect S&P's 'B-' Rating FIRSTLINE SECURITY: Section 341(a) Meeting Slated for February 28 FIRST MAGNUS: Arizona Bank Wants WNS Subpoena Quashed FIRST MAGNUS: Executives Plan New Mortgage Company FIRST MAGNUS: Inks Settlement to Countrywide's Objection to Plan FIRST MAGNUS: Wants All Plan Confirmation Objections Overruled FORD MOTOR: Plans to Offer Buyout Packages to 9,000 Workers FOREST LAKE: Case Summary & 20 Largest Unsecured Creditors GENERAL MOTORS: May Have to Fund Delphi's Exit, Investors Say GENERAL MOTORS: Reaches Agreement with UAW on Attrition Program GENERAL MOTORS: Posts Net Loss of $38.7 Billion in 2007 GENERAL MOTORS: Inviting Ex-Guide Corp. Workers to Apply at Plants GLOBAL MOTORSPORT: Files Schedules of Assets and Liabilities GLOBAL MOTORSPORTS: U.S. Trustee Balks at Terms of Asset Sale GRANT WILLIAMS: Case Summary & Four Largest Unsecured Creditors HAVEN HEALTHCARE: Court Extends Filing of Schedules Until Friday HDB LLC: U.S. Trustee to Convene Section 341(a) Meeting on March 5 IDEARC INC: S&P Changes Outlook to Negative; Holds BB Rating IMAC CDO: Moody's Junk Ratings of Six Classes of Notes INNOVATIVE DESIGNS: Louis Plung & C Expresses Going Concern Doubt INPHONIC INC: Court Sets March 21, 2008 as Claims Bar Date IAC/INTERACTIVECORP: Improved HSN Might End Liberty Media Feud JAI BHOLA: Case Summary & 10 Largest Unsecured Creditors JETBLUE AIRWAYS: Elects Christoph Franz to Board of Directors JOHNSON RUBBER: U.S. Trustee Adds RCMA Americas Into Committee JOSE LUZ: Case Summary & 10 Largest Unsecured Creditors LEVITT AND SONS: Abandons Interest in 8 Homeowners Associations LEVITT AND SONS: Depositors Want Claims Bar Date Fixed at March 11 LEVITT AND SONS: River Hall Panel Wants to File $10MM in Claims LIBERTY TAX II: Dec. 31 Balance Sheet Upside-Down by $11.1 Million LITHIUM TECH: Amper Politziner Expresses Going Concern Doubt MANIS LUMBER: Case Summary & 46 Largest Unsecured Creditors MARK MILLER: Defaults on $12.4 Million Loan from Wachovia Bank MATTRES GALLERY: Can Access OMG DIP Facility on Final Basis MAXJET AIRWAYS: Taps Morten Beyer as Expert Valuation Consultants MOHEGAN TRIBAL: Moody's Reviews Low-B Ratings for Likely Cut OAK MESA: Section 341(a) Meeting Slated for February 20 OCEAN SPRAY: Moody's Reviews Low-B Ratings for Possible Upgrades OTTO BEYER: Section 341(a) Meeting Slated for February 25 PARMALAT SPA: Milan Court Starts Trial Against Banks, et al. PARMALAT: Former Auditor Says He Warned of EUR170-Mil. Debt PIKE NURSERY: Judge Diehl Approves KPMG as Real Estate Advisor PLASTECH ENGINEERED: Court Okays Donlin Recano as Claims Agent PLASTECH ENGINEERED: Court Okays Donlin Recano as Claims Agent PLASTECH ENGINEERED: Lenders Want to Intervene in Chrysler Suit QUALITY HOME: Chapter 11 Trustee Taps Irell as Special Counsel QUALITY HOME: Trustee Taps Stanley Shure as Insurance Counsel QUEBECOR WORLD: Moody's Assigns 'Ba2' Rating on $400 Mil. Sr. Loan REFCO INC: Court Moves Claim Objection Deadline to April 30 REFCO INC: Sale of 35% Equity Stake in FXCM Consummated REFCO INC: SPhinX Liquidators Want Protective Order Eased RANCHO DEL SOL BRILLANTE: Voluntary Chapter 11 Case Summary REMINGTON ARMS: Theodore Torbeck Named Chief Operating Officer RH DONNELLEY: S&P Changes Outlook to Negative; Holds 'BB-' Rating RH DONNELLEY: Fitch Assigns 'B+' Issuer Default Rating RICHARD RANDALL: Case Summary & 10 Largest Unsecured Creditors ROTECH HEALTHCARE: Requests Transfer to NASDAQ Capital Market SANTA FE ENERGY: Trustee Seeks NYSE Delisting, Distributes Funds SANTA ROSA BAY: Fitch Puts 'BB-' Bonds Rating Under Neg. Watch SCO GROUP: Reduces Workforce by 30 Positions to Reduce Expenses SOUTHERN UNION: Citrus Corp. Inks $500 Million Loan with FPL Group SPECTRUM BRANDS: Dec. 30 Balance Sheet Upside-Down by $141.2 Mil. STRADA 315: Case Summary & 20 Largest Unsecured Creditors TOUSA INC: Wants to Hire Greenberg Traurig as Special Counsel TOUSA INC: Gets Interim OK on Lazard Freres as Investment Banker TOUSA INC: Seeks Approval of KZC Services Agreement TP EMERALD: Section 341(a) Creditors Meeting Set for March 4 USA INVESTMENT: Court Confirms Chapter 11 Plan of Liquidation US ENERGY SYSTEMS: Chancery Ct. Moved Special Meeting to Feb. 19 US SHIPPING: Reports $1.4 Mil. Net Loss for Quarter Ended Dec. 31 VICTORY MEMORIAL: Wants Court to Approve Asset Sale Procedure VISAGE CDO: Event of Default Cues Fitch to Junk, Withdraw Ratings VONAGE HOLDINGS: Sharon O'Leary Resigns as EVP Effective March 31 WATERFORD GAMING: Moody's Reviews Low-B Ratings for Possible Cuts WESTSHORE GLASS: Section 341(a) Creditors Meeting Set for Feb. 29 WHERIFY WIRELESS: Inks Forbearance Pact with Yorkville Advisors WIN WIN GAMING: Section 341(a) Creditors Meeting Set for March 5 * S&P Downgrades 67 Tranches' Ratings From 10 Cash Flows and CDOs * S&P Downgrades Ratings on Seven Classes From Six NIMS RMBS * S&P Downgrades Ratings on 21 Classes of Certs. From Eight RMBS * Fitch Says Weakening Economy Will Challenge Restaurant Industry * Fitch Updates Credit Card Indices for the Month of January * Pres. Bush Slashes Budget for Children's Federal Health Programs * Six Banks Join Alliance to Grant 30-Day "Pause" on Foreclosures * Focus Management's Naglewski Named as Finalist by M&A Advisor * Upcoming Meetings, Conferences and Seminars ********* ACE AVIATION: Earns $1.13 Billion in Quarter Ended December 31 -------------------------------------------------------------- ACE Aviation Holdings Inc. reported net income of $1.13 billion in quarter ended Dec. 31, 2007. The company reported net income of $1.4 billion for the full year 2007. Net income included $1.37 billion pre-tax gains mainly from the sale of ACTS and from the secondary offerings of Aeroplan and Jazz. "I am pleased with our strong progress during 2007 with the implementation of ACE's business strategy," Robert Milton, chairman, president and chief executive officer, ACE Aviation Holdings Inc., said. "We have delivered strong financial results for the year and we've also made excellent progress in delivering shareholder value." "In the first six months of 2007, we returned $2 billion of capital, under a Plan of Arrangement approved in 2006, to our shareholders through distributions of units in Aeroplan and Jazz," Mr. Milton added. "We completed the monetization of ACTS during the fourth quarter with net cash proceeds to ACE on closing of $723 million, and received the remaining proceeds of $40 million in January 2008 which had been held in escrow. ACE also retains a 23 per cent holding in ACTS post-monetization. "In the fourth quarter, we also raised $726 million through secondary offerings of Aeroplan and Jazz, reducing our shareholdings in both to 20.1 per cent," Mr. Milton continued. "In January 2008, ACE further reduced its holding in Jazz to 9.5% by way of an exempt trade. In December 2007, we launched a $1.5 billion substantial issuer bid which was completed in January 2008." At Dec. 31, 2007, the company's balance sheet showed total assets of CDN$13.77 billion, total liabilities of CDN$10.55 billion and total shareholders' equity of $CDN3.22 billion. About ACE Aviation Headquartered in Montreal, Canada, ACE Aviation Holdings Inc. (Toronto: ACE-A.TO) -- http://www.aceaviation.com/-- is the parent holding company of Air Canada, Aeroplan, Jazz, Air Canada Technical Services, Air Canada Vacations, Air Canada Cargo, and Air Canada Ground Handling Services. * * * ACE Aviation Holdings continues to carry Dominion Bond Rating Service's 'B+' long-term local and foreign issuer credit ratings, which were placed on April 2006. ADAM AIRCRAFT: Suspends Colorado Biz Over Failure to Secure Funds ----------------------------------------------------------------- Adam Aircraft Inc. said on its Web site that it suspended operations Monday at its facilities in Colorado. Adam Aircraft said the move was "difficult but necessary." This measure, according to the company, was required due to its inability to come to terms with their lender for funding necessary to maintain business operations. The company is currently exploring all of its alternatives and will provide further guidance when decisions are made, which is expected to be later this week. Adam Needs To Secure Financing As reported in the Troubled Company Reporter on Jan. 25, 2008, Adam Aircraft Industries must secure two financing transactions otherwise it will be forced to liquidate, as stated in a letter by CEO John Wolf to stockholders. Although the company had already secured $5.5 million in December 2007, it needed to obtain $30.5 million by the end of January. According to the letter, the company must successfully complete the $30.5 million transaction in order for the company to obtain at least a $100 million equity financing led by Citibank sometime in May 2008. At that time, the company warned that if it is unable to complete its first financing by the end of January, the company could undergo liquidation in order to pay its obligations to its lenders. Then, the letter stated, stockholders will have little or no recovery for their investments. The company had offered parties who invest for the January financing a 49.9% equity interest in a newly formed subsidiary. About Adam Aircraft Adam Aircraft Industries -- http://www.adamaircraft.com/-- designs and manufactures advanced aircraft for civil and government markets. The A500 twin-engine piston aircraft has been Type Certified by the FAA, and the A700, which is currently undergoing flight test and development. ALLEGHENY TECH: S&P Upgrades Corporate Credit Rating From 'BB+' --------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit and other ratings on Allegheny Technologies Inc. to 'BBB-' from 'BB+'. The outlook is stable. "The upgrade reflects the company's meaningful improvement in operating and financial performance due to strong demand in its key end markets, its shift away from commodity-based products and pricing, and its improved cost structure," said Standard & Poor's credit analyst Marie Shmaruk. "Although visibility through the first half is unclear because of an uncertain economy and delays in the Boeing 787 Dreamliner, the outlook for the company's major end markets are favorable for at least the next few years and we expect ,that Allegheny's solid performance will reflect that favorable outlook." Ms. Shmaruk added, "We could change the outlook to positive or upgrade the ratings further if the company's end markets remain strong, the company completes its aggressive growth plans without increasing debt, and financial policies remain conservative. Conversely, material weakness in Allegheny's markets and performance could pressure ratings, as would a significant increase in the company's debt leverage to fund growth or shareholder-friendly actions." Pittsburgh-based Allegheny is a diversified specialty material producer. AMC ENT: Posts $11.2 Mil. Net Loss in 3rd Quarter Ended Dec. 27 --------------------------------------------------------------- AMC Entertainment Inc. reported a net loss of $11.2 million on total revenues of $559.0 million for the third quarter ended Dec. 27, 2007, compared with a net loss of $6.5 million on total revenues of $596.4 million in the same period last year. U.S. and Canada theatrical exhibition revenues decreased 6.9%, or $38.5 million during the thirteen weeks ended Dec. 27, 2007, compared to the thirteen weeks ended Dec. 28, 2006. Admissions revenues decreased 5.6%, or $21.1 million due to a 10.7% decrease in attendance partially offset by a 5.7% increase in average ticket prices. Concessions revenues decreased 6.6%, or $9.8 million, due to the decrease in attendance partially offset by a 4.7% increase in average concessions per patron related primarily to price increases. Other theatre revenues decreased 29.2%, or $7.6 million, primarily due to decreases in on-screen advertising revenues as a result of the new Exhibitor Services Agreement with NCM. International theatrical exhibition revenues increased 2.6%, or $1.1 million during the thirteen weeks ended Dec. 27, 2007, compared to the thirteen weeks ended Dec. 28, 2006. Thirty-Nine Weeks Ended December 27 Total revenues increased 0.5%, or $9.1 million, to $1.88 billion during the thirty-nine weeks ended Dec. 27, 2007, compared to $1.87 billion thirty-nine weeks ended Dec. 28, 2006. Net earnings were $47.9 million and a loss of $25.4 million for the thirty-nine weeks ended Dec. 27, 2007, and Dec. 28, 2006, respectively. Cash Flow from Operations Cash flows provided by operating activities were $227.4 million and $205.2 million during the thirty-nine weeks ended Dec. 27, 2007, and Dec. 28, 2006, respectively. The increase in operating cash flows during the thirty-nine weeks ended Dec. 27, 2007, is primarily due to the increase in net earnings. The company had approximately $182.5 million and $177.5 million available on its credit facility to meet obligations as they come due for the periods ended Dec. 27, 2007, and March 29, 2007, respectively. Balance Sheet At Dec. 27, 2007, the company's consolidated balance sheet showed $3.91 billion in total assets, $2.76 billion in total liabilities, and $1.15 billion in total stockholders' equity. The company's consolidated balance sheet at Dec. 27, 2007, also showed strained liquidity with $308.8 million in total current assets available to pay $491.1 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended Dec. 27, 2007, are available for free at http://researcharchives.com/t/s?27ed About AMC Entertainment Based in Kansas City, Missouri, AMC Entertainment Inc. -- http://www.amctheatres.com/-- is one of the world's largest theatrical exhibition companies. The serves more than 230 million guests annually through interests in 358 theatres with 5,128 screens in six countries. * * * To date, AMC Entertainment Inc. still carries Moody's Investors Service's Ba1 bank loan debt and B2 senior subordinate ratings. Outlook is Negative. AMERICAN HOME: Court Sets February 26 as Loan Sale Bid Deadline --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has set 4:00 p.m., Eastern Time, on Feb. 26, 2008, as the final deadline for parties to submit a bid on American Home Mortgage Holdings Inc.'s sale of certain non-performing loans. On Feb. 1, 2008, the Court authorized the sale of non-performing loans, subject to higher and better offers for each pool of non- performing loans. The Debtors relate that they will post the highest indicative bid on their intralinks Web site on or before 12:00 n.n., Eastern Time on Feb. 27, 2008. Additionally, the Court disclosed that a hearing to confirm the auction will be held before the Hon. Christopher S. Sontchi on 11:00 a.m., Eastern Time, Feb. 28, 2007, at the 5th Floor, 824 North Market Street, Wilmington, Delaware. Parties who wishes to object on the sale of these non-performing loans has until Feb. 21, 2008, to submit their objections. Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expired Dec. 21, 2007. AMERICAN TECHNOLOGIES: Inks Agreement with Laurus on Note Default ----------------------------------------------------------------- American Technologies Group Inc. reached an agreement with Laurus Master Fund, Ltd. granting Laurus a first priority security interest in the common stock of each of its subsidiaries in connection with its failure to timely pay its current obligations due to Laurus under its $2 million secured convertible term B note. ATG also executed a security agreement that granted Laurus a first priority security interest in all the respective goods, inventory, contractual rights and general intangibles, receivables, documents, instruments, chattel paper, intellectual property owned by ATG and each of its subsidiaries. On Jan. 31, 2008, ATG received notification from Laurus that certain events of default had occurred and are continuing beyond any applicable cure or grace period with respect to all of its secured obligations due to Laurus. ATG also received a letter from LV Administrative Services, Inc., acting in the capacity of administrative and collateral agent for Laurus, that demands the immediate payment of all past due amounts owed to Laurus by Feb. 1, 2008. The amounts demanded totaled $13,580,810 -- $10,350,000 in principal amortization, $96,777 in accrued interest, and $3,134,033 in Default Fees. ATG did not make the payments, and, accordingly, Laurus took all steps it deemed necessary to protect its interests, including the enforcement and exercise of any and all of its rights, remedies, liens and security interests available to it. The security agreement and stock pledge agreement state that if an "event of default" occurs under any agreement with Laurus, it has the right to take possession of the collateral, to operate its business using the collateral, and has the right to assign, sell, lease or otherwise dispose of and deliver all or any part of the collateral, at public or private sale or otherwise to satisfy its obligations under these agreements. As a consequence of its default, Laurus has the right to pursue any of the remedies set forth in the pledge and security agreements. Prior to the receipt of notice of default, and continuing through the date of this filing, ATG have been in ongoing negotiations with Laurus concerning its obligations to them. These negotiations resulted ATG's receipt of nonbinding term sheets from Laurus outlining a transaction which would result in the satisfaction of its obligations to Laurus. The transaction outlined in the term sheets has been approved in principal by ATG's Board of Directors and ATG expects to close the transaction after finalization and execution of definitive documents and shareholder approval. It is anticipated that the transaction would close in the month of March. Although ATG are hopeful that these negotiations will result in an agreement that is beneficial to the company, ATG has no commitments or assurances that it will be successful or that Laurus will not pursue any or all of the remedies available to it in light of ATG's default. Going Concern Doubt RBSM LLP, in New York, expressed substantial doubt about American Technologies Group Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended July 31, 2007. The auditing firm reported that the the company has suffered recurring losses and is experiencing difficulty in generating sufficient cash flow to meet its obligations and sustain its operations. About American Technologies Based in Fort Worth, Texas, American Technologies Group Inc. (NASDAQ: ATEG) -- was prior to 2001, engaged in the development, commercialization and sale of products and systems using patented and proprietary technologies including catalyst technology and water purification. The company ceased operations during 2001 and began focusing efforts on restructuring and refinancing. In September 2005, the company entered into various financing transactions and acquired North Texas Steel Company Inc., an AISC Certified structural steel fabrication company based in Fort Worth, Texas. On April 25, 2006, the company purchased certain assets of Whitco Company LP, a business conducting the sale and distribution of steel and aluminum lighting poles. The Whitco assets are held in a separate subsidiary called Whitco Poles Inc. ARAMARK CORP: S&P Keeps 'B+' Corp. Rating on High Leverage Profile ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on ARAMARK Corp. At the same time, Standard & Poor's raised its rating on ARAMARK's senior secured debt to 'BB' (two notches above the corporate credit rating on ARAMARK), from 'BB-'. The recovery rating was changed to a '1', indicating the expectation for very high (90%-100%) recovery in the event of a payment default, from '2'. The outlook is stable. ARAMARK had approximately $5.9 billion of debt outstanding as of Dec. 28, 2007. "The rating actions reflect improved recovery prospects on the credit facilities following ARAMARK's approximately $400 million in voluntary prepayments during fiscal 2007," said Standard & Poor's credit analyst Jean C. Stout. The ratings on Philadelphia-based ARAMARK continue to reflect its highly leveraged financial profile and significant cash flow requirements to fund interest and capital expenditures. These factors are somewhat mitigated by ARAMARK's good position in the competitive, fragmented markets for food and support services and uniform and career apparel. These positions translate into a sizable stream of recurring revenues and healthy cash flow generation. ASARCO LLC: U.S. Government Wants Late-Filed EPA Claim Allowed -------------------------------------------------------------- The U.S. Government seeks leave from the U.S. Bankruptcy Court for the Southern District of Texas to file a supplemental proof of claim against ASARCO LLC and its debtor-affiliates on behalf of the Environmental Protection Agency for response costs it incurred and to be incurred under the Comprehensive Environmental Response, Compensation, and Liability Act with respect to ASARCO's Terrible Mine Site in Custer County, Colorado. Alan Tenenbaum, Esq., in Washington, D.C., asserts that the Government's failure to timely file a claim relating to the Terrible Mine Site is due to excusable neglect. Mr. Tenenbaum relates that the EPA first discovered that ASARCO had some involvement in the pollution in the Terrible Mine Site when it concluded its investigation in August 2007. After receiving a report on the investigation, the EPA began evaluating the evidence and compiling the additional information it needed to confirm the existence of its claim against ASARCO, Mr. Tenenbaum adds. The EPA notified ASARCO of the liability in December 2007, he says. Mr. Tenenbaum asserts that ASARCO will not be prejudiced by the filing of the claim because it knew of the liability at the same time as mediation proceedings on its plan of reorganization were still ongoing. The Government, however, did not disclose with the Court the amount of its claim relating to the Terrible Mine Site. About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Court gave the Debtors until April 11, 2008 to file a plan of reorganization. (ASARCO Bankruptcy News Issue No. 66; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Can Employ Filardi as Local Counsel ----------------------------------------------- ASARCO LLC and its debtor-affiliates obtained permission from the U.S. Bankruptcy Court for the Southern District of Texas to employ The Filardi Law Offices LLC as their local counsel, nunc pro tunc to Jan. 3, 2008, to represent them in L. Tersigni Consulting, P.C.'s bankruptcy case. As reported in the Troubled Company Reporter, L. Tersigni Consulting, P.C., the financial advisor retained by the Official Committee of Unsecured Creditors for the Asbestos Subsidiary Debtors, filed a Chapter 11 case in the U.S. Bankruptcy Court in the District of Connecticut, Bridgeport Division, in November 2007. An investigation into alleged overbillings done by the Tersigni firm's deceased owner, Loreto Tersigni, is ongoing in the Connecticut Court. The Debtors want to appear in the Tersigni bankruptcy case to monitor the case's progress and developments, to pursue any potential claims against the firm, and to otherwise protect their interests. As local counsel, Filardi will: (a) represent the Debtors at any proceeding or hearing before the Connecticut Court; (b) prepare any pleadings, motions, answers, notices, orders, and reports required for the Debtors in the Tersigni bankruptcy case; (c) advise, consult with, and assist the Debtors in their investigation of the acts, conduct, assets, liabilities and financial condition of Tersigni, the operation of Tersigni's business, and the desirability of the continuance of its business; and (d) assist the Debtors in the negotiation of or opposition to or support of a plan or plans of reorganization in the Tersigni case. The Debtors will pay $395 per hour for Charles J. Filardi, Jr., Esq., who will take the lead in representing the Debtors in the Tersigni case, and $150 per hour for paralegal work. Payment for the services to be rendered by Filardi will be taken from either the Wells Fargo Escrow Account or the London market insurers escrow account. Charles J. Filardi, Jr., Esq., principal at Filardi, assured the Court that his firm does not represent any interest adverse to the Debtors and their estate, and is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Court gave the Debtors until April 11, 2008 to file a plan of reorganization. (ASARCO Bankruptcy News Issue No. 66; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Can Hire Paul Ruh at A&M LLC as Bankruptcy Controller ----------------------------------------------------------------- ASARCO LLC and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Southern District of Texas to further expand the employment agreement it entered into with Alvarez & Marsal, LLC, its financial and restructuring advisors, to include the employment of Paul Ruh as bankruptcy controller, effective as of Dec. 1, 2007. As bankruptcy controller, Mr. Ruh is expected to provide accounting and consulting services for ASARCO, including, without limitation: (a) assisting and supporting ASARCO with respect to its external audits; (b) providing accounting support for matters relating to ASARCO's tracking and reporting of liabilities; and (c) providing data and support for use in ASARCO's Disclosure Statement and Plan of Reorganization. ASARCO will pay Mr. Ruh a $60,000 flat fee per month from Dec. 1, 2007, until the effective date of a Chapter 11 reorganization plan. James R. Prince, Esq., at Baker Botts, L.L.P., in Dallas, Texas, told the Court that Alvarez & Marsal has substantially completed its prior projects for ASARCO. The remaining duties of the Bankruptcy Controller are the only projects with which Alvarez & Marsal is assisting ASARCO at this time, he added. ASARCO believes that Mr. Ruh is uniquely qualified to fill the position of Bankruptcy Controller, as he has extensive experience performing services for ASARCO and has deep personal knowledge of the company's business practices. About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). The Court gave the Debtors until April 11, 2008 to file a plan of reorganization. (ASARCO Bankruptcy News Issue No. 66; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). BALLANTYNE RE: Losses Cue S&P to Junk Ratings on Two Sub Debts -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its subordinated debt ratings on Ballantyne Re plc's Class B-1 and B-2 notes to 'CCC-' from 'B-'. The notes will remain on CreditWatch with negative implications where they were placed on Sept. 14, 2007. At the same time, Standard & Poor's said that its Class A-1 notes on Ballantyne Re will remain on CreditWatch with negative implications, where they were placed on Nov. 21, 2007. "We took these actions in response to the continuing mark-to- market losses experienced on the assets in the underlying collateral accounts," said Standard & Poor's credit analyst Gary Martucci. "Since Nov. 21, mark-to-market losses have increased, putting additional strain on the structure. Interest on the Class B notes continues to accrue but has remained unpaid since Sept. 4, 2007, and market value declines, if realized, will put these notes at an increasing likelihood of having losses sometime in the future." For interest to be paid on the Class A-1 notes, the transaction requires the fair market value of the combined assets in the surplus and prefunded account to be equal to or greater than 100% of the company action level risk-based capital. This difference between the fair market value of assets available to make interest payments on the Class A-1 notes and 100% CALRBC has been narrowed since the November ratings action. Although the Class A-1 notes have continued to receive interest payments, the concern is that the continued decline in the underlying asset values will result in an interest payment limitation trigger being breached. Standard & Poor's will monitor the developments in the assets values in the accounts and determine if any future ratings actions are warranted on any notes issued by Ballantyne Re. BEAR STEARNS: S&P Chips Rating on Class B Certs. to BB From BBB --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on the class B asset-backed certificates from Bear Stearns Asset Backed Securities Trust 2003-2 to 'BB' from 'BBB'. Concurrently, S&P affirmed its ratings on the asset-backed certificates from nine Bear Stearns Asset Backed Securities Trust transactions, including series 2003-2. The downgrade of class B from series 2003-2 reflects adverse collateral performance that has caused monthly losses to exceed excess interest. The affirmations are based on loss coverage percentages that are sufficient to maintain the current ratings. The information below highlights the performance data for the nine series as of the January 2008 remittance period. Performance Data Cum. realized Severe Series losses (i) delinq. (ii) ------ ------------- ------------ 2003-2 1.96% 8.36% 2003-3 3.46% 10.00% 2003-SD1 0.86% 3.27% 2003-SD2 0.79% 5.40% 2004-SD1 0.53% 3.30% 2004-SD2 0.97% 3.99% 2004-SD3 1.11% 5.64% 2004-SD4 0.74% 7.06% 2006-SD4, collat1 0.05% 8.65% 2006-SD4, collat2 0.17% 2.73% 2006-SD4, collat3 0.00% 17.12% (i) As a percentage of original pool balance. (ii) As a percentage of current pool balance. Current pool balance Months Series (orig. pool balance) seasoned ------ -------------------- -------- 2003-2 19.86 53 2003-3 23.45 51 2003-SD1 29.52 52 2003-SD2 19.45 50 2004-SD1 43.16 45 2004-SD2 26.55 44 2004-SD3 44.40 39 2004-SD4 30.60 37 2006-SD4, collat1 75.86 13 2006-SD4, collat2 87.39 13 2006-SD4, collat3 82.17 13 The negative collateral performance trend within series 2003-2 has led to the deterioration of overcollateralization (O/C) and credit support from subordination. Monthly losses for this transaction have been outpacing monthly excess interest in recent months, causing overcollateralization to decline to $3,362,510, or 0.65% of the original pool balance, which is below its target of 0.70% of the original pool balance. As of the January 2008 remittance period, monthly losses for the past three months averaged $335,459, while monthly excess interest for the past three months averaged $168,133. S&P affirmed its ratings on the remaining classes from series 2003-2 and from the other eight series based on loss coverage percentages that are sufficient to maintain the current ratings. Subordination provides credit support for series 2003-SD2, 2004- SD2, and 2006-SD4. Subordination, O/C, and excess spread provide credit support for the other transactions. The collateral for these transactions primarily consists of reperforming, fixed- and/or adjustable-rate first- and second-lien mortgage loans secured by one- to four-family residential properties. Rating Lowered Bear Stearns Asset Backed Securities Trust Asset-backed certificates Rating ------ Series Class To From ------ ----- -- ---- 2003-2 B BB BBB Ratings Affirmed Bear Stearns Asset Backed Securities Trust Asset-backed certificates Series Class Rating ------ ----- ------ 2003-2 A-1, A-2, A-3 AAA 2003-2 M-1 AA 2003-2 M-2 A 2003-3 A-IO, A-2 AAA 2003-3 M-1 AA 2003-3 M-2 A 2003-3 B BBB 2003-SD1 A AAA 2003-SD1 M-1 AA 2003-SD1 M-2 A 2003-SD1 B BBB 2003-SD2 I-A, II-A, III-A AAA 2003-SD2 B-1 AA+ 2003-SD2 B-2 A+ 2003-SD2 B-3 BBB 2003-SD2 B-4 BB 2003-SD2 B-5 B 2004-SD1 A-1, A-2 AAA 2004-SD1 M-1 AA 2004-SD1 M-2 A 2004-SD1 M-3 BBB 2004-SD1 B BBB- 2004-SD2 I-A, II-A, III-A AAA 2004-SD2 IV-A AAA 2004-SD2 B-1 AA 2004-SD2 B-2 A 2004-SD2 B-3 BBB 2004-SD2 B-4 BB 2004-SD2 B-5 B 2004-SD3 A-2, A-3, A-4 AAA 2004-SD3 M-1 AA 2004-SD3 M-2 A 2004-SD3 M-3 BBB 2004-SD3 B BBB- 2004-SD4 A-1, A-2 AAA 2004-SD4 M-1 AA 2004-SD4 M-2 A 2004-SD4 B BBB 2006-SD4 1A-1, 1A-2, 1A-3 AAA 2006-SD4 2A-1, 2A-2 AAA 2006-SD4 3A-1, 3A-2 AAA 2006-SD4 X-1, X-2 AAA 2006-SD4 B-1 AA 2006-SD4 B-2 A 2006-SD4 B-3 BBB 2006-SD4 B-4 BB 2006-SD4 B-5 B BLOUNT INT'L: Sept. 30 Balance Sheet Upside-Down by $78.1 Million ----------------------------------------------------------------- Blount International Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $472.4 million in total assets and $550.5 million in total liabilities, and $78.1 million in total stockholders' deficit. The company reported net income of $9.4 million for the third quarter ended Sept. 30, 2007, compared with net income of $15.1 million in the same period of 2006. Sales for the company for the third quarter increased to $166.9 million or 1.7% from last year's third quarter. Sales for the company's Outdoor Products segment increased by 9.5% from last year's third quarter to more than offset a 14.7% decline in the Industrial and Power Equipment Segment. Operating income was $22.6 million in this year's third quarter compared to $18.7 million last year. Last year's third quarter operating income included non-recurring charges of $4.8 million related to the redesign of the company's retirement plans and the closure of a manufacturing facility. Income from continuing operations in this year's third quarter was $9.4 million, compared to $10.1 million in the comparable period last year. This year's income from continuing operations includes income tax expense of $5.7 million compared to an income tax benefit of $640,000 last year, when the company recognized the impact of certain tax planning strategies. Commenting on the company's results, James S. Osterman, chairman and chief executive officer, stated: "Third quarter sales for our Outdoor Products segment increased solidly from last year as we experienced strong growth in key international markets. This top line growth resulted in a slight improvement to segment contribution despite continued margin pressure caused by a further strengthening of the Canadian and Brazilian currencies. We ended the third quarter with a good order backlog in the Outdoor Products segment and expect to continue to experience year over year sales growth through the fourth quarter." Total Debt Total debt at Sept. 30, 2007, was $355.0 million compared to $350.9 million at Dec. 31, 2006. As of Sept. 30, 2007, outstanding debt consisted of a revolving credit facility balance of $32.3 million, a term loan of $147.8 million and senior subordinated notes of $175.0 million. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?27f2 About Blount International Blount International Inc. (NYSE: BLT) -- http://www.blount.com/-- is a diversified international company operating in two principal business segments: Outdoor Products and Industrial and Power Equipment. The company's Outdoor Products segment provides chain, bars and sprockets to the chainsaw industry, accessories to the lawn care industry and concrete cutting saws. BOHUMIR MARIK: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Bohumir Marik 350 North Pacific Coast Highway Redondo Beach, CA 90277 Bankruptcy Case No.: 08-11715 Chapter 11 Petition Date: February 10, 2008 Court: Central District Of California (Los Angeles) Debtor's Counsel: John Saba, Esq. 13902 Gershon Pl Santa Ana, CA 92705 Tel: (714) 544-1276 Fax: (714) 544-2307 Total Assets: $2,206,450 Total Debts: $2,247,840 The Debtor does not have any unsecured creditors who are not insiders. BOISE CASCADE: Aldabra 2 Stockholders Approve Merger Deal --------------------------------------------------------- Aldabra 2 Acquisition Corp.'s stockholders approved an acquisition of Boise Cascade LLCs packaging and paper manufacturing businesses. The vote to approve the merger took place at Aldabra's special meeting of stockholders. Aldabra anticipates the transaction to close during the last week of February 2008. Aldabra plans to change its name to Boise Inc. and list its common stock and warrants for trading on the New York Stock Exchange under the new symbols BZ and BZ.WS, respectively, upon the consummation of the acquisition. The acquisition is subject to customary closing conditions and the completion of Aldabra's previously announced financing being arranged by Goldman Sachs Credit Partners LP and Lehman Brothers. "We are happy with the performance of the company and the growth prospects of Boise Inc. as a standalone public company," Alexander Toeldte, the designated chief executive officer of Boise Inc., said. "The paper market dynamics remain positive, and our business continues to perform very well." "Additionally, we are beginning to see positive results from the acquisitions and investments we have made over the past 24 months," Mr. Toeldte added. "We are pleased with the momentum we have in the business as we enter the public company arena." About Boise Cascade Based in Boise, Idaho, Boise Cascade Holdings -- http://www.bc.com -- maintains wood and paper products. It manufactures and distributes lumber, plywood, particleboard, and engineered products such as wood I-joists and laminated lumber. It operates nearly 30 wholesale building material distribution centers throughout the US. Boise Cascade also makes and sells office papers, uncoated free sheet papers, envelopes, forms bond, and printing papers, as well as newsprint, market pulp, containerboard, and corrugated containers. It has sold its timberland assets. Formerly part of Boise Cascade Corporation, the company is controlled by private investment firm Madison Dearborn Partners through Forest Products Holdings, LLC. About Aldabra Headquartered in New York, New York, Aldabra 2 Acquisition Corp. (AMEX:AII.U) -- http://www.aldabracorp2.com/-- is a blank check company. The company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition or other similar business combination with an operating business. As of March 19, 2007, Aldabra 2 Acquisition Corp did not have any specific business combination under consideration. BOISE CASCADE: S&P Designates 'BB' Rating on Negative CreditWatch ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its CreditWatch implications on Boise Cascade LLC, including its 'BB' corporate credit rating, to negative from developing. BC's ratings were initially placed on CreditWatch on Sept. 7, 2007, following the company's announcement that it was selling its paper, packaging and newsprint businesses to unrated Aldabra 2 Acquisition Corp. for $1.63 billion. "We have concluded that if the transaction is completed as currently proposed, we would lower BC's corporate credit rating by one notch to 'BB-'," said Standard & Poor's credit analyst Pamela Rice. "The outlook would be negative. The anticipated downgrade reflects our assessment that the legacy BC will have a weaker business risk profile following the transaction, because it will be substantially less diversified." Although BC expects to use the majority of the $1.3 billion of cash it receives to pay down debt, its wood products manufacturing and building products distribution businesses will subject the company to much greater earnings and cash flow volatility. The lower rating would incorporate BC's remaining ownership, which is expected to be 40% to 49%, in Boise Paper Holdings LLC (BB- /Stable/--); however, S&P is not factoring in any cash distributions from Boise Paper in the next year or two. The anticipated negative outlook reflects continuing uncertainties about the depth and duration of the current housing downturn. BC had debt, including debt-like obligations, of $1.4 billion at Sept. 30, 2007. The ratings will remain on CreditWatch until the transaction closes, which is expected by the end of February. If the sale is completed in the manner proposed and proceeds are used as S&P expects, the 'BB+' rating on the $1.18 billion senior secured credit facilities will be withdrawn, and the rating on the company's remaining subordinated notes will be lowered to 'B' from 'B+'. BON-TON STORES: Moody's Cuts Corp. Rating to B2 on 2007 Weak Sales ------------------------------------------------------------------ Moody's Investors Service downgraded the corporate family rating of Bon-Ton Stores Inc. to B2 from B1, downgraded the probability of default rating to B2 from B1, and downgraded the rating on the $510 million senior unsecured notes to Caa1 (LGD 5, 78%) from B3 (LGD 5, 83%). The company's speculative grade liquidity rating of SGL-3 was affirmed. The outlook on all ratings is stable. The downgrade was prompted by Bon-Ton's weak December 2007 sales results, continuing negative comparable store sales trend, and the company's downward EBITDA guidance revision for the fiscal 2007. The company's weaker-than-expected results will result in deterioration of the company's key credit metrics, notably in interest coverage and leverage. This concludes the review for possible downgrade that was initiated on Nov. 19, 2007. These ratings are downgraded: -- Corporate family rating to B2 from B1 -- Probability of default rating to B2 from B1 -- $510 million senior unsecured notes to Caa1 (LGD 5, 78%) from B3 (LGD 5, 83%). These ratings are affirmed: -- Speculative grade liquidity at SGL-3 -- Outlook: Stable Bon-Ton's B2 corporate family rating reflects the company's moderate size, strong presence in secondary markets, and adequate liquidity. However, the ratings are constrained by the company's profit margin levels that are below its industry peer group average and its relatively weak competitive position in the department store industry. Bon-Ton competes with larger and better capitalized retail companies that are reverting to aggressive promotions and clearances in order to shed fall and holiday inventory, gain foot traffic, and maintain appropriate margin levels. Moody's believes that Bon-Ton does not have the scale and market strength to effectively withstand these price wars and maintain credit metrics that are appropriate for its previous rating. Bon-Ton maps to a B1 rating utilizing the rating factors mapped in Moody's Global Retail Rating Methodology - one notch higher than its actual B2 corporate family rating. The one notch variance reflects company's relatively weak competitive position and key credit metrics that are indicative of a B2 rating category. The Bon-Ton Stores, Inc. is a regional department store chain, headquartered in York, Pennsylvania. The company operates 280 stores in 23 Northeastern, Midwestern, and upper Great Plains states under Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's and Younkers nameplates and, under the Parisian nameplate, stores in the Detroit, Michigan area. Revenues for the last twelve months ended Nov. 3, 2007 were approximately $3.6 billion. CAMPBELL RESOURCES: Nuinsco Provides $1.5 Mil. Revolving Facility ----------------------------------------------------------------- Nuinsco Resources Limited has provided Campbell Resources Inc. with a secured revolving credit facility to a maximum aggregate amount of $1.5 million. Nuinsco has also agreed to purchase and subscribe for 6,000,000 common shares of Campbell, at a price of $0.10 per share, for gross proceeds of $0.6 million. The proceeds of the credit facility and the Campbell Financing will be used by Campbell to fund further development of Campbell's operations in Chibougamau, Quebec, and for working capital purposes. Prior to closing the Campbell Financing, Nuinsco owns 42,250,000 common shares of Campbell, representing 9.77% of the outstanding common shares of Campbell. Nuinsco also currently holds a total of 63,807,429 warrants to purchase common shares of Campbell at $0.10 per share, expiring on Jan. 18, 2009, warrants entitling it to purchase 15,625,000 common shares at $0.15 per share, and a convertible debenture in the principal amount of $2,000,000. The debenture is convertible into units of Campbell at a price of $0.13 per unit. Each unit is exercisable into one common share of Campbell for no additional consideration, and one-half of one common share purchase warrant. Each unit warrant entitles the holder to purchase one common share of Campbell at a price of $0.16 per common share until July 20, 2009. The maximum number of common shares of Campbell issuable to Nuinsco on conversion of the debenture and exercise of its unit warrants is 23,076,922 common shares. If Nuinsco were to exercise all of its convertible securities in Campbell, including full conversion of the debenture into units and exercise of all of the underlying unit warrants, Nuinsco would hold approximately 144,759,351 common shares of Campbell, representing approximately 27.05% of the outstanding common shares of Campbell, calculated on a partially diluted basis assuming the exercise of all of the convertible securities held by Nuinsco only. After giving effect to the Campbell Financing, which is expected to close on or about Feb. 15, 2008, Nuinsco will own 48,250,000 common shares of Campbell, representing approximately 11.0% of the outstanding common shares of Campbell, and convertible securities entitling it to purchase an additional 102,509,351 common shares of Campbell. If, after the closing of the Campbell Financing, Nuinsco were to fully convert the debenture into units and exercise all of the outstanding common share purchase warrants of Campbell then held by it, Nuinsco would own an aggregate of 150,759,351 common shares of Campbell, representing approximately 27.86% of the outstanding common shares of Campbell, calculated on a partially diluted basis assuming the exercise of all of the convertible securities held by Nuinsco only. The Campbell securities held by Nuinsco were acquired for investment purposes. Nuinsco may from time to time acquire additional securities of Campbell, dispose of some or all of the existing or additional securities it holds or will hold, or may continue to hold its current position. In addition to its equity interest in Campbell, Nuinsco owns a 50% carried interest in the high-grade Corner Bay copper project near Campbell's Copper Rand mine and mill in Chibougamau, Quebec. Corner Bay is currently being developed by Campbell. About Campbell Resources Headquartered in Montreal, Quebec, Campbell Resources Inc. (TSX: CCH, OTC BB: CBLRF) -- http://www.ressourcescampbell.com/-- is a mining company focusing mainly in the Chibougamau region of Quebec, holding interests in gold and gold-copper exploration and mining properties. The Superior Court of Quebec (Commercial District) granted the company protection under the CCAA on June 30, 2005. The plans of arrangement presented to the creditors of Campbell Resources Inc., Meston Resources Inc. and MSV Resources Inc., under the Companies' Creditors Arrangement Act, received the required approvals on June 27, 2006, in Chibougamau. The main assets of the company are the Joe Mann Mine, an underground gold mine owned by Meston Resources Inc., a wholly owned subsidiary of the company, the Copper Rand Mine, an underground gold and copper mine owned by MSV Resources Inc., a wholly owned subsidiary of the company, and the Corner Bay Property, located near the Chibougamau Lake in the townships of Lemoine and Obalski, a total of 16 claims, which are held by MSV. The company's properties include Pitt Gold, Berthiaume Syndicate, Chevrier, Gwillim, Joe Mann Mine, Cedar Bay, Copper Rand Mine, Corner Bay, Eastmain and Lac Harbour. The activities of GeoNova Explorations Inc. consist mainly in the acquisition, exploration and development of mining properties. It focuses on exploration in the Province of Quebec and more specifically, in the Abitibi region. About Nuinsco Headquartered in Toronto, Ontario, Nuinsco Resources Limited (TSE:NWI) -- http://www.nuinsco.ca-- is a natural resource company engaged in the acquisition, exploration and development of precious and base metal deposits. Its exploration projects/properties are located in Canada and Turkey. As of March 2007, its interests included a 70% interest in the Diabase Peninsula property located in the Athabasca Basin of northern Saskatchewan; a 100% interest in the Prairie Lake complex located in northwestern Ontario; a 50% interest in the Berta project located in northeastern Turkey; a 100% interest in the Elmalaan property in northeastern Turkey; a 99% interest in the Cameron Lake project located in northwestern Ontario, and an entitlement to a 50% carried interest in the Corner Bay Deposit located in Chibougamau, Quebec. Effective Feb. 1, 2007, Nuinsco spun off its Minago, Mel and Lac Rocher nickel projects to create Victory Nickel Inc. Nuinsco holds an approximate 23% equity interest in Victory Nickel. CATALYST PAPER: Inks Sale of Snowflake Mill With AbitibiBowater --------------------------------------------------------------- AbitibiBowater has signed a definitive agreement with Catalyst Paper Corporation for the sale of its Snowflake, Arizona, assets for cash consideration of $161 million, excluding working capital of approximately $19 million retained by AbitibiBowater. The facility has an annual production capacity of approximately 375,000 tonnes of newsprint. The closing of this transaction is required to comply with the requirements set by the U.S. Department of Justice in October 2007 for approval of the Abitibi-Consolidated/Bowater combination. AbitibiBowater plans to use the proceeds from this sale to repay debt and for general corporate purposes. The sale of the Snowflake mill is subject to customary closing conditions, including a financing contingency which is expected to be satisfied in part by a fully backstopped rights offering. The sale is expected to close in the second quarter. About Catalyst Paper Headquartered in Richmond, Canada, Catalyst Paper Corporation (TSX: CTL) -- http://www.catalystpaper.com-- is a newsprint and specialty ground wood paper producer in North America. The company operates four manufacturing divisions, and one paper recycling division in British Columbia, Canada. The company operates in three business segments: specialty papers, engaged in the manufacture and sale of ground wood specialty printing paper; newsprint, engaged in the manufacture and sale of newsprint, and pulp, engaged in the manufacture and sale of long and short fiber pulp and containerboard. The primary market for the company's paper products is North America. The primary markets for the company's pulp products are Asia, Australasia and Europe. About AbitibiBowater Headquartered in Montreal, Canada, AbitibiBowater Inc. (NYSE:ABH) -- http://www.abitibibowater.com/-- was formed as a result of the combination of Abitibi-Consolidated Inc. and Bowater Incorporated. Pursuant to the transaction, Abitibi-Consolidated Inc. and Bowater Incorporated became subsidiaries of AbitibiBowater. The company produces forest products marketed in more than 80 countries around the world. The company's customers include publishers, commercial printers, retailers, consumer products companies and building supply outlets. AbitibiBowater is also a recycler of newspapers and magazines. The company owns or operates 32 pulp and paper mills and 35 wood products facilities in North America and offshore. The company manages its business in five segments: coated papers, specialty papers, newsprint, market pulp and lumber. CATALYST PAPER: S&P Ratings Unaffected by $161 Million Merger Deal ------------------------------------------------------------------ Standard & Poor's Ratings Services said that the ratings on Catalyst Paper Corp. (B/Negative/--) are unaffected by the acquisition of the Snowflake, Arizona, mill from AbitibiBowater Inc. for $161 million (the merged entities Abitibi-Consolidated Inc. and Bowater Inc. are both rated B/Negative/--). The acquisition improves Catalyst's business risk profile because it will lower newsprint production costs, diversify operations, and reduce the company's exposure to a strong Canadian dollar. All of Catalyst's mills are in B.C. The acquisition should improve leverage modestly as it will be financed by 78% equity and 22% debt. However, it will reduce liquidity under Catalyst's credit facility by CDN$36 million. As of Sept. 30, 2007, the company had CDN$239 million available under its credit facility and no cash on hand. COHR HOLDINGS: Moody's Alters Outlook to Negative; Holds B2 Rating ------------------------------------------------------------------ Moody's Investors Service revised Cohr Holdings, Inc.'s ratings outlook to negative from stable. Concurrently, Cohr's existing ratings, including the B2 Corporate Family Rating, were affirmed. The change of the company's ratings outlook to negative from stable reflects the negative variance from original expectations for operating performance which were set when the ratings were first assigned in February 2007. Sidney Matti, Analyst, stated that, "Cohr's weaker than projected operating performance resulted from lower than anticipated revenues coupled with higher than expected expenses." As a result, the company's credit metrics are weak relative to the B2 rating category. Ratings could experience a downgrade if the metrics were to continue to remain weak resulting from a loss of a major customer and/or continued sluggishness in Cohr's operating performance. The affirmation of the B2 Corporate Family Rating considers the company's highly leveraged position, weak interest coverage, modest size, significant customer concentration, and highly competitive environment. Additionally, the Corporate Family Rating reflects the company's stable free cash flow, high customer retention rate and the lack of direct government reimbursement risk. The ratings outlook was revised to negative from stable. These ratings were affirmed: -- B2 Corporate Family Rating; -- B2 Probability of Default Rating; -- B1 (to LGD3/38% from LGD3/35%) rating on the $20 million Senior Secured Revolver; and -- B1 (to LGD3/38% from LGD3/35%) rating on the $140 million Senior Secured Term Loan. Headquartered in Chatsworth, California, Cohr Holdings, Inc. is a leading independent service organization in the diagnostic imaging and biomedical equipment maintenance and repair services industry. COMMERCIAL MORTGAGE: Stable Performance Cues Fitch to Hold Ratings ------------------------------------------------------------------ Fitch Ratings has affirmed Commercial Mortgage Corp.'s commercial mortgage pass-through certificates, series 2000-CF1, as: -- $550.5 million class A-1B at 'AAA'; -- Interest-only class S at 'AAA'; -- $44.3 million class A-2 at 'AAA'; -- $37.7 million class A-3 at 'AAA'; -- $13.3 million class A-4 at 'AAA'; -- $31 million class B-1 at 'AAA'; -- $11.1 million class B-2 at 'AAA'; -- $31 million class B-3 at 'A'; -- $8.9 million class B-4 at 'BBB+'; -- $2.2 million class B-5 at 'BBB'; -- $6.6 million class B-6 at 'BBB-'; -- $8.9 million class B-7 at 'B+'; -- $8.9 million class B-8 at 'B-'. Class A-1A has paid in full. Fitch does not rate the $4.7 million class C certificates. Class D has been reduced to zero due to realized losses. The affirmations reflect stable performance since Fitch's last rating action. In total, 46 loans (52.9%) have defeased, including the largest loan (6.8%) and six additional top 10 loans (24%). As of the January 2008 distribution date, the pool has paid down 14.4% to $759 million from $886.2 million at issuance. The weighted average loan size of the 67 remaining non-defeased loans is $5.4 million. In addition, the weighted average loan rate of the non-defeased loans is 8.42%. Finally, 7.5% of the non-defeased loans mature in 2009 while a further 27.4% mature in 2010. Fitch has identified 17 loans (9.5%) as Fitch Loans of Concern. This includes one loan (0.2%) which was transferred to the special servicer in February 2008. Fitch LOC includes specially serviced loans, loans with low debt service coverage ratios and other performance issues. The weighted average interest rate of these LOC is 8.65%. DELPHI CORP: Lenders Have Problems Syndicating $6.1 Billion Loan ---------------------------------------------------------------- Delphi Corp.'s plan to secure $6.1 billion in financing for its exit from Chapter 11 bankruptcy protection is in jeopardy as bank lenders tried to cope with credit markets that remain virtually shut, The Wall Street Journal says, citing people familiar with the matter. J.P. Morgan Chase & Co. and Citigroup Global Markets, which agreed to arrange funding for Delphi, are having difficulties syndicating the loan to other lenders, the Journal's source said. The Journal's Jeffrey McCracken and John D. Stoll relate that hedge funds and other investors dislike the borrowing terms, saying that they aren't priced appropriately for the risk involved. Investors and others involved in the matter say Delphi's former parent, General Motors Corp., may have to step in and provide financing to fill the gap, the Journal relates. Yet too much GM involvement might spook stock investors, who don't want Delphi too beholden to GM and its price-cutting demands, the Journal says. Fritz Henderson, GM's chief financial officer, has said GM is exploring alternatives in the event Delphi cannot obtain the Chapter 11 exit financing it planned, Dow Jones Newswires say. Mr. Henderson, however, didn't give any details on what kind of alternatives GM was exploring with Delphi and its investor group, Dow Jones notes. "Our objective is to have Delphi exit," Mr. Henderson said in an interview, WSJ notes. "What we've tried to do is be constructive with Delphi and the plan-investors as to how we play a role." GM yesterday reported a $722 million fourth-quarter loss, to end the year a staggering $38.7 billion in the red -- believed to be the largest annual loss ever by an auto maker, the Journal's John Stoll reports. GM recorded a $622 million charge associated with its support of Delphi's restructuring efforts as well as $552 million charge for pension benefits provided to Delphi employees and retirees. KeyBanc analyst Brett Hoselton said in a note to investors Tuesday that GM may have to provide financing itself, Dow Jones reports. Delphi could consider trying to get a smaller exit-financing package, but falling U.S. auto sales and lowered forecasts for GM sales in 2008 "probably mean Delphi needs more money, not less," WSJ quotes a person familiar with Delphi's talks with their lenders. "Any logical person would look at the situation in the U.S. economy and say Delphi needs more," that source told WSJ. As reported in the Troubled Company Reporter on Feb. 4, 2008, Delphi and its debtor-affiliates expect to consummate their First Amended Joint Plan of Reorganization on or before March 31, 2008, Delphi Corp. Vice President and Chief Restructuring Officer John D. Sheehan said in a regulatory filing with the U.S. Securities and Exchange Commission. As reported in the Troubled Company Reporter on Jan. 9, 2008, the Debtors reduced their Exit Financing from the Court-approved $6.8 billion to $6.1 billion. The reduced facilities include: (a) $1.6 billion in an asset-backed revolving credit facility; (b) $3.7 billion in a first-lien term loan facility; and (c) $825 million in a second lien term loan facility. The TCR reported Jan. 30, 2008, that the Honorable Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York permits members of the Official Committee of Unsecured Creditors and the Official Committee of Equity Security Holders appointed in Delphi's bankruptcy cases to participate in any syndicate of lenders assembled to provide exit financing facilities for the Debtors' emergence from Chapter 11. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on Nov. 9, 2007, Moody's Investors Service affirmed its rating for General Motors Corporation (B3 Corporate Family Rating, Ba3 senior secured, Caa1 senior unsecured and SGL-1 Speculative Grade Liquidity rating) but changed the outlook to Stable from Positive. In an environment of weakening prospects for US auto sales GM has announced that it will take a non-cash charge of $39 billion for the third quarter of 2007 related to establishing a valuation allowance against its deferred tax assets (DTAs) in the US, Canada and Germany. As reported in the Troubled Company Reporter on Oct. 23, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and other ratings on General Motors Corp. and removed them from CreditWatch with positive implications, where they were placed Sept. 26, 2007, following agreement on the new labor contract. The outlook is stable. About Delphi Corp. Headquartered in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Jan. 16, 2008, Moody's Investors Service assigned ratings to Delphi Corporation for the company's financing for emergence from Chapter 11 bankruptcy protection: Corporate Family Rating of (P)B2; $3.7 billion of first lien term loans, (P)Ba3; and $0.825 billion of 2nd lien term debt, (P)B3. In addition, a Speculative Grade Liquidity rating of SGL-2 representing good liquidity was assigned. The outlook is stable. As reported in the Troubled Company Reporter on Jan. 11, 2008, Standard & Poor's Ratings Services expects to assign its 'B' corporate credit rating to Troy, Michigan-based automotive supplier Delphi Corp. upon the company's emergence from Chapter 11 bankruptcy protection, which may occur by the end of the first quarter of 2008. S&P expects the outlook to be negative. In addition, Standard & Poor's expects to assign these issue-level ratings: a 'B+' issue rating (one notch above the corporate credit rating), and '2' recovery rating to the company's proposed $3.7 billion senior secured first-lien term loan; and a 'B-' issue rating (one notch below the corporate creditrating), and '5' recovery rating to the company's proposed $825 million senior secured second-lien term loan. DELTA FINANCIAL: Committee Taps Landis Rath as Delaware Counsel --------------------------------------------------------------- The Official Committee of Unsecured Creditors in Delta Financial Corp. and its debtor-affiliates' Chapter 11 cases seeks permission from the U.S. Bankruptcy Court for the District of Delaware to retain Landis Rath & Cobb LLP as its Delaware counsel. As Delaware counsel, LRC will: * render legal advice with respect to the powers and duties of the Creditors Committee and the other participants in the Debtors' Chapter 11 cases; * assist the Creditors Committee in its investigation of the acts, conduct, assets, liabilities and financial condition of the Debtors; the operation of the Debtors' businesses and any other matter relevant to the bankruptcy cases, as and to the extent the matters may affect the Debtors' creditors; * participate in negotiations with parties-in-interest with respect to any disposition of the Debtors' assets, plan of reorganization and disclosure statement in connection with the plan; * prepare all necessary applications, motions, answers, orders, reports and papers on behalf of the Creditors Committee, and appear on behalf of the Creditors Committee at hearings as necessary and appropriate in connection with the bankruptcy cases; * render legal advice and perform all other necessary legal services; and * perform all other legal services in connection with the bankruptcy cases, as may be requested by the Creditors Committee. LRC will be paid according to its customary hourly rates. Two LRC professionals are expected to take a lead role in representing the Creditors Committee in the Debtors' bankruptcy cases: Professional Hourly Rate ------------ ----------- Richard S. Cobb, Esq. partner $475 John H. Strock, Esq. associate $240 LRC will also be reimbursed for any necessary out-of-pocket expenses it incurs while providing legal services to the Creditors Committee. Richard S. Cobb, Esq., at Landis Rath and Cobb LLP, in Wilmington, Delaware, assures the Court that the firm does not represent any interest adverse to the Creditors Committee or the Debtors' estates, and is a "disinterested person" within the meaning of Sections 101(14) and 1103 of the Bankruptcy Code. About Delta Financial Founded in 1982, Delta Financial Corporation (NASDAQ: DFC) -- http://www.deltafinancial.com/-- is a Woodbury, New York-based specialty consumer finance company that originates, securitizes and sells non-conforming mortgage loans. The company filed a chapter 11 petition on December 17, 2007 (Bankr. D. Del. Lead Case No. 07-11880). On the same day, three affiliates filed separate chapter 11 petitions -- Delta Funding Corp., Renaissance Mortgage Acceptance Corp., and Renaissance R.E.I.T. Investment Corp. -- (Bankr. D. Del. Case Nos. 07-11881 to 07-11883). The Debtors selected Morrison & Foerster LLP as their general bankruptcy counsel and David B. Stratton, Esq. and James C. Carignan, Esq. at Pepper Hamilton LLP as their counsel. The Debtors hired AlixPartners LLP as their claims agent. The Debtors' amended consolidated quarterly financial condition as of Sept. 30, 2007, showed $7,223,528,000 in total assets and $7,108,232,000 in total liabilities. The Debtors' petition listed D.B. Structured Products Inc. as their largest unsecured creditor holding a $19,500,000 claim. The Debtors' exclusive period to file a plan expires on April 15, 2008. (Delta Financial Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service Inc.http://bankrupt.com/newsstand/or 215/945-7000). DELTA FINANCIAL: Committee Taps Weiser LLP as Financial Advisor --------------------------------------------------------------- The Official Committee of Unsecured Creditors in Delta Financial Corp. and its debtor-affiliates' Chapter 11 cases seeks permission from the U.S. Bankruptcy Court for the District of Delaware to retain Weiser LLP as its financial advisor, effective as of Jan. 8, 2008. Silvia L. Spear, managing director of Deutsche Bank Trust Company Americas and chairperson of the Creditors Committee, relates that Weiser has substantial experience in accounting and financial consulting, including turnarounds and bankruptcy; and has participated in numerous Chapter 11 proceedings before the U.S. Bankruptcy Court for the District of Delaware. As financial advisor, Weiser will: (a) review all financial information prepared by the Debtors or its consultants as sought by the Creditors Committee including, but not limited to, a review of Debtors' financial statements as of the filing of the petition, showing in detail all assets and liabilities and priority and secured creditors; (b) monitor the Debtors' activities regarding cash expenditures, receivable collections, asset sales and projected cash requirements; (c) attend meetings including the Creditors Committee, the Debtors, creditors, their attorneys and consultants, and federal and state authorities, if required; (d) review the Debtors' periodic operating and cash flow statements; (e) review the Debtors' books and records for related party transactions, potential preferences, fraudulent conveyances and other potential prepetition investigations; (f) undertake any investigation with respect to the prepetition acts, conduct, property, liabilities and financial condition of the Debtors, their management, creditors including the operation of their business, and as appropriate avoidance actions; (g) review and analyze proposed transactions for which the Debtors seek the Court's approval; (h) assist in a sale process of the Debtors collectively or in segments, parts or other delineations, if any; (i) assist the Creditors Committee in developing, evaluation, structuring and negotiating the terms and conditions of all potential Chapter 11 plans of reorganization, including preparation of a liquidation analysis; (j) analyze claims filed; (k) estimate the value of the securities, if any, that may be issued to unsecured creditors under any plan; (l) provide expert testimony on the results of the firms findings; (m) assist the Creditors Committee in developing alternative reorganization plans, including contacting potential plan sponsors if appropriate; and (n) provide the creditors Committee with other and further financial advisory services with respect to the Debtors, including valuation, general restructuring and advice with respect to financial, business and economic issues, as may arise during the course of the restructuring as sought by the Committee. Weiser will be paid according to their customary hourly rates: Professional Hourly Rate ------------ ----------- Partners & Directors $375 to $540 Managers $275 to $375 Supervisors $225 to $250 Assistants $125 to $225 Paraprofessionals $72 to $132 Weiser will also be reimbursed of the actual and necessary expenses, charges and disbursements it incurs in connection with the services it provides to the Creditors Committee. James Horgan, a partner at Weiser, assures the Court that the firm does not represent any interest adverse to the Creditors Committee or the Debtors' estate, and is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Delta Financial Founded in 1982, Delta Financial Corporation (NASDAQ: DFC) -- http://www.deltafinancial.com/-- is a Woodbury, New York-based specialty consumer finance company that originates, securitizes and sells non-conforming mortgage loans. The company filed a chapter 11 petition on December 17, 2007 (Bankr. D. Del. Lead Case No. 07-11880). On the same day, three affiliates filed separate chapter 11 petitions -- Delta Funding Corp., Renaissance Mortgage Acceptance Corp., and Renaissance R.E.I.T. Investment Corp. -- (Bankr. D. Del. Case Nos. 07-11881 to 07-11883). The Debtors selected Morrison & Foerster LLP as their general bankruptcy counsel and David B. Stratton, Esq. and James C. Carignan, Esq. at Pepper Hamilton LLP as their counsel. The Debtors hired AlixPartners LLP as their claims agent. The Debtors' amended consolidated quarterly financial condition as of Sept. 30, 2007, showed $7,223,528,000 in total assets and $7,108,232,000 in total liabilities. The Debtors' petition listed D.B. Structured Products Inc. as their largest unsecured creditor holding a $19,500,000 claim. The Debtors' exclusive period to file a plan expires on April 15, 2008. (Delta Financial Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service Inc.http://bankrupt.com/newsstand/or 215/945-7000). DOMAIN INC: To Hold Bankruptcy Liquidation Sale ------------------------------------------------ Domain, Inc., dba Domain Home Furnishings will conduct a court- ordered bankruptcy liquidation sale beginning February 13, 2008. The sale was ordered by the U.S. Bankruptcy Court for the District of Delaware as a result of Domain's recent Chapter 11 filing. The value of the inventory to be liquidated is approximately $20 million. The Domain liquidation is being managed jointly by two leading national retail liquidation firms: Hudson Capital Partners, of Newton, Mass., and Great American Group, of Los Angeles. "Domain has been a landmark for consumers who appreciate high quality home design, and the liquidation sale provides a final opportunity to take advantage of this incredible home furnishing resource," noted Hudson Capital Partners co-founder Jim Schaye. The Domain merchandise to be liquidated will include furniture, accessories, decor items, lighting, rugs and other designer products. The sale will involve all Domain store locations in Massachusetts, Connecticut, New Jersey, New York, Pennsylvania, Maryland and Virginia. Following the liquidation sale, which is expected to take several weeks, all of the Domain retail locations will be closed. As reported in the Troubled Company Reporter Feb. 7, 2008, Domain held an auction last week to sell substantially all of its assets. The Boston Globe reported that Domain named Great American Group LLC as lead bidder. Great American offered $5.2 million to buy Domain Home's inventory and liquidate the furniture chain, Boston Globe said. Boston Globe also reported Hudson Capital Partners LLC, was considering bidding for Domain. Hudson Capital chief executive James Schaye has a minority stake in Domain under another company known as Golden Acquisition, where he serves as managing partner, Boston Globe said. Great American would get a $120,000 break-up fee if Domain ultimately sell its assets to another party, according to Boston Globe. Great American would pay about 64 cents on the dollar-cost value of the Debtors' inventory, estimated at $8.5 million, and pay a minimum of $75,000 to bring in additional goods to sell during the liquidation and pay the ongoing cost to run the stores, Boston Globe said, citing Maura Russell, Esq., Dreier LLP, Domain's counsel. Certain owners or operators of regional retail shopping centers leased by the Debtors have objected to the proposed sale of the Debtors' assets. The Taubman landlords want the Debtors to comply with the use clause provision of their leases. They point out that the lease provisions preclude the Debtors from conducting any auction, liquidation, going out of business, fire or bankruptcy sales in the leased premises. They also want the Debtors to cure any existing defaults under the lease, as well as provide proof that any assignee of the lease can adequately perform under the contract and will not disrupt tenant mix. About Hudson Capital Partners, LLC Hudson Capital Partners, LLC offers an extensive array of professional solutions to the challenges retailers face today, including management of excess, obsolete and discontinued inventory, changing geographic and demographic circumstances, unproductive store sites, and real estate and liquidity issues. The firm's diversified staff is experienced at performing strategic store closings and relocations, fixed asset dispositions, wholesale inventory buyouts and lease mitigations. To learn more about Hudson Capital Partners, please visit the firm's Web site at http://www.hudsoncpl.com/ About Great American Group With offices in Los Angeles, Chicago, Boston, New York, Philadelphia, and Atlanta, Great American Group is known for its dominant presence in the asset conversion business. The firm has expertise in the disposition of assets across a diverse range of industries. Additional information is available at http://www.greatamerican.com/ About Domain Inc. Norwood, Massachussetts-based Domain Inc., dba Domain Home/Domain Home Furnishings/Domain-Home.com -- http://www.domain-home.com/-- operate a chain of 27 home furnishing stores across seven states in the Northeast and Mid-Atlantic regions of the US, including suburbs of major metropolitan markets such as Boston, New York, Philadelphia and Washington, D.C. The Debtor and its affiliate, Domain Home Holding Co., LLC, filed for chapter 11 bankruptcy on Jan. 18, 2008 (Bankr. D. Del. Case Nos. 08-10132 and 08-10133). J. Kate Stickles, Esq., and Mark Minuti, Esq., at Saul Ewing LLP represent the Debtors in their restructuring efforts. When the Debtors filed for bankruptcy, they listed assets and debts between $10 million and $50 million. The Debtors have disclosed that $4,900,000 was outstanding on a secured revolving credit loan. DOMAIN INC: Taps Dreier LLP as General Bankruptcy Counsel --------------------------------------------------------- Domain Inc. and its debtor-affiliate ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Dreier LLP as their general counsel, nunc pro tunc to Jan. 18, 2008. As the Debtors' general counsel, Dreier LLP will: a) provide legal advice with respect to their powers and duties as debtors-in-possession in the continued operation of their businesses; b) prepare and pursue confirmation of a plan of reorganization or liquidation and aproval of a disclosure statement; c) prepare on behalf of the Debtors necessary applications, &