TCR_Public/080229.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, February 29, 2008, Vol. 12, No. 51

                             Headlines

ACANDS INC: Trustee Opposes Plan; Wants Claims Release Justified
ACANTO SADDLEBACK: Sec. 341(a) Creditors Meeting Set for March 3
ACCEPTANCE INSURANCE: Can File Chapter 11 Plan Until May 30
AIRWAY MOVING: Case Summary & 20 Largest Unsecured Creditors
ALANCO TECH: Posts $2,005,800 Net Loss in 2nd Qtr. Ended Dec. 31

AMERICAN MEDIA: Dec. 31 Balance Sheet Upside-Down by $369.0 Mil.
AMERICAN STANDARD: Expects to File for Chapter 11 Protection
ATLANTIS PLASTICS: S&P Ratings Tumbles to 'D' on Covenant Defaults
AVANTAIR INC: Dec. 31 Balance Sheet Upside-Down by $22.3 Million
AVENTINE RENEWABLE: Liquidity Issues Incite Failed Auctions

AVENTINE RENEWABLE: Earns $3.2 Mil. For Fourth Qtr. Ended Dec. 31
AVENTINE RENEWABLE: Moody's Lowers SGL Rating on Failed Auctions
BALLY TOTAL: Reaches Settlement with SEC After Fraud Allegations
BELDEN INC: Board Appoints Judy Brown as Director
CALPINE CORP: Inks Geothermal Purchase Agreement With PG&E

CATHOLIC CHURCH: Objection Deadline on Calkin Retention is March 3
CATHOLIC CHURCH: Century Balks at Davenport's Disclosure Statement
CATHOLIC CHURCH: Regina High Opposes Davenport's Bankruptcy Plan
CATHOLIC CHURCH: Portland's Bankruptcy Reopened by Judge Perris
CATHOLIC CHURCH: Spokane's Ranch Faces Suit Filed by Ex-Residents

CATHOLIC CHURCH: Tuscon Can Distribute $1 Million For Tort Claims
CENTRAL IOWA: McGladrey & Pullen Expresses Going Concern Doubt
CHRYSLER LLC: Idles Plant in Ontario Due to TRW's Workers Strike
CHRYSLER LLC: Plastech to Continue Sending Supplies Until March 3
CITICORP MORTGAGE: Fitch Rates $1.392MM Class B-4 Certs. at BB

CLOROX COMPANY: Prices $500 Million Offering of 5% Senior Notes
COLTRANE CLO: Fitch Cuts Ratings to "CC" on 4 Classes of Notes
COMMODORE CDO: Moody's Reviews Junk Rating on $17.5 Million Notes
COMMUNITY HEALTH: Posts $88MM Net Loss in Qtr. Ended December 31
CORNERSTONE MINISTRIES: Wants Scroggins & Williamson as Counsel

CORNERSTONE MINISTRIES: Wants Miller & Martin as Outside Counsel
CORNERSTONE MINISTRIES: Wants eNable Business as Financial Advisor
CORNERSTONE MINISTRIES: Schedules Filing Period Moved to March 11
CRDENTIA CORP: Completes $10 Million Long Term Debt Financing
CREDIT-SUISSE: Fitch Cuts Rating on $500,000 Cl. B-3 Certs. to BB

CREDIT SUISSE: Fitch Chips Ratings on $113.2 Million Certificates
DEALMAKER DEVELOPMENTS: Voluntary Chapter 11 Case Summary
DELPHI CORP: Shareholder Settlement Hearing Set for April 29
DILLARD'S INC: S&P Supersedes Outlook From Stable to Negative
DIRECTV GROUP: Stake Swap Results in Two Board Seats for Liberty

DIRECTV GROUP: FCC Sees Liberty Media Deal to Benefit Public
EQUIFIRST MORTGAGE: Class B-2 Cert. Gets S&P's Junk Rating From BB
FAIRPOINT COMMS: S&P Lifts Rating to 'BB' on Merger With Verizon
FAIRPOINT COMMS: Proposed Merger Approval Cues Moody's 'B1' Rating
FIDELITY NATIONAL: Earns $108 Mil. in Quarter ended December 31

FINLAY ENTERPRISES: Deal with NRDC Ends Over Fortunoff Sale
FIRST NLC: Adverse Pool Performance Spurs S&P's Rating Downgrades
FORTUNOFF: Asset Sale Causes Termination of Finlay-NRDC Agreement
FORTUNOFF: Highest Bid Awarded to NRDC Equity's H Acquisition
FREESTAR TECH: Posts $4,568,270 Net Loss in 2nd Qtr. Ended Dec. 31

GARTECH ELECTRICAL: Case Summary & 59 Largest Unsecured Creditors
GENERAL MOTORS: Idles Assembly Plant Due to AAM Workers' Strike
GENERAL MOTORS: Supplier's Workers Strike Won't Affect S&P Rating
GLOBAL SIGNAL: Fitch Holds 'BB+' Rating on $122.4MM Class F Certs.
GLOBAL SIGNAL: Fitch Holds 'BB-' Rating on $3.8MM Class G Certs.

IDEARC INC: CEO John Mueller Steps Down After 10 Days of Service
IMPLANT SCIENCES: Posts $4,815,000 Net Loss in Qtr. Ended Dec. 31
IPS CORP: Moody's Changes Outlook to Negative; Holds 'B2' Ratings
IRVINE SENSORS: Posts $3.7 Million Net Loss in Qtr. Ended Dec. 30
IXIS REAL: S&P Slashes Five Classes' Ratings on Weak Performance

JAMES LULL: Debt from "Ponzi Scheme" May Have Reached $50 Million
KEFTON CDO: Moody's Junks Rating on Up To $67 Mil. Notes From 'A3'
KELLWOOD CO: S&P Chips Rating to B+ After Sun Capital Tender Offer
LASALLE COMM: Increased Loss Expectations Cue Fitch to Cut Ratings
LENNAR CORP: Receives Purchase Offer from UAE Group, Report Says

LIBERTY MEDIA: Gains 41% Interest in DirecTV After Swap
LIBERTY MEDIA: FCC Sees DirecTV Group Deal to Benefit Public
LILLIAN VERNON: Has Interim Authority to Tap $8.5MM DIP Financing
LONGPORT FUNDING: Six Classes of Notes Get Moody's Junk Ratings
LOUISIANA-PACIFIC CORP: Moody's Chips Senior Debt Rating to ' Ba2'

MASTR ASSET: Class M-9 and Class M-10 Gets S&P's Rating Downgrades
MCCALL CITY: Council Passes Resolution Allowing Bankruptcy Filing
MEDICOR LTD: Court Approves $7 Million DIP Financing
MEDICOR LTD: Wants Until May 26 to File Chapter 11 Plan
MIIX INSURANCE: Court Wants Creditors to Appear at April 9 Hearing

MILACRON INC: Dec. 31 Balance Sheet Upside-Down by $51.1 Million
MORGAN STANLEY: Fitch Holds Junk Rating on $5.3MM Class M Certs.
MORGAN STANLEY: Moody's Pares Ratings on 47 Tranches From 14 Deals
MSGI SECURITY: Dec. 31 Balance Sheet Upside-Down by $4,245
NATIONWIDE HEALTH: Fitch Affirms 'BB+' Rating on Preferred Stock

NEUMANN HOMES: Court Extends Exclusive Plan Filing Periods
NEW CENTURY: Moody's Cuts Ratings on Five Tranches From Two Deals
NORTEL NETWORKS: Posts $844 Mil. Net Loss in Fourth Quarter 2007
OFF PRICE: Chapter 7 Filing and Store Closures Hurt Customers
ONEIDA LTD: Selling Business in Australia to McPherson's Limited

OVERSEAS SHIPHOLDING: Net Income Drops at $21.2MM For 4th Qtr.
OVERSEAS SHIPHOLDING: S&P Ratings Unaffected By Net Profit Decline
PACIFIC PINNACLE: Moody's Junks Ratings on Five Classes of Notes
PAMPELONNE CDO: Moody's Junks Rating on $50 Mil. Notes From 'Ba1'
PELOTON PARTNERS: Liquidates $2 Billion ABS Fund

PHARMED GROUP: Wants Exclusive Plan Filing Period Extended
PHARMED GROUP: Taps Jonathan Green as Special Tax Counsel
PINNACLE PEAK: Moody's Junks Rating on $140 Mil. Notes From 'Aaa'
PLASTECH ENGINEERED: Court Extends DIP Financing Until March 3
PLASTECH ENGINEERED: Agrees to Supply Chrysler Until March 3

POPE & TALBOT: Has Interim OK to Obtain DIP Loan; Monitor Comments
POPE & TALBOT: Court Fixes Claims Bar Date at April 3
PRB ENERGY: Defaults Obligations Under Senior Secured Debentures
QUIGLEY COMPANY: Posts $7.2 Million Net Loss in Year Ended Dec. 31
SCHUYLER GUEST: Case Summary & 17 Largest Unsecured Creditors

SCOTTISH RE: A.M. Best Chips Issuer Credit Rating to bb from bbb-
SEVERNA PARK: Case Summary & 17 Largest Unsecured Creditors
SHARPER IMAGE: Asks Court to Extend Schedules Filing Deadline to
SHARPER IMAGE: Court Grants Request to Pay Vendor Obligations
SHILOH'S INDUSTRIES: Moody's Holds Ba3 Rating With Stable Outlook

SIRVA INC: Obtains Additional $10 Million DIP Loan; Panel Objects
SOLIDUS NETWORKS: Auction of Three Non-Core Businesses Adjourned
SPRINT NEXTEL: Reports $29.5 Billion Net Loss in 4th Quarter 2007
SPRINT NEXTEL: Expected Bad Fin'l Results Cue Fitch to Cut Ratings
SPRINT NEXTEL: Moody's Give Negative Outlook on Weak Operations

SPRINT NEXTEL: Losses Cues S&P to Put Ratings on Negative Watch
SOLIDUS NETWORKS: No Qualified Offers Obtained to Buy Core Assets
SOLIDUS NETWORKS: Whorl LLC Balks at Asset Sale and DIP Financing
SOLUTIA INC: Gets Exit Financing; Emerges From Ch. 11 Protection
SOLUTIA INC: Judge Beatty OKs Bank of New York Settlement Pact

SOLUTIA INC: Court Approves Bayer & Lanxess Claims Settlement
SOLUTIA INC: Court Approves Quinn Emanuel as Conflicts Counsel
SPOTTED DOG: Case Summary & 20 Largest Unsecured Creditors
ST MARY LAND: Inks $42 Million Oil and Gas Assets Acquisition Deal
STONE ENERGY: Earns $65 Million in Quarter ended December 31

SUMMERWIND INVESTORS: Voluntary Chapter 11 Case Summary
TEMBEC INC: Ontario Court Approves Plan of Arrangement under CBCA
TRAILER BRIDGE: Moody's Gives Negative Outlook; Keeps All Ratings
TRW AUTOMOTIVE: CAW Workers Rally at Windsor Plant in Ontario
URS CORP: Earns $132 Million in Fiscal Year Ended December 28

USG CORP: Weak Fin'l Performance Cues Moody's Rating Cuts to 'Ba2'
VALENCE TECH: Inks Agreement to Sell $1 Million Common Shares
VALLE GRANDE: Case Summary & Three Largest Unsecured Creditors
VALLEJO CITY: Reaches Tentative Deal with Labor Unions
WELLS FARGO: Fitch Rates $1.35 Million Class B-5 Certificates at B

WICKES FURNITURE: Liquidation Sale of All Stores Starts Tomorrow
WOLVERINE TUBE: Credit & Receivables Sales Facilities Amended
WOODCOCK ESTATE: Case Summary & 20 Largest Unsecured Creditors
YOUR RV WIZARD: Voluntary Chapter 11 Case Summary
ZALE CORP: Reduces Staffing on New Operational Efficiency Program

* S&P Says 418 ABS Ratings Affected by Bond Insurer Rating Actions
* S&P Downgrades 85 Tranches' Ratings From 16 Cash Flows and CDOs

* Ropes & Gray Opens Chicago Office and Welcomes Three Partners

* BOOK REVIEW: Inside Investment Banking: Second Edition

                             *********

ACANDS INC: Trustee Opposes Plan; Wants Claims Release Justified
----------------------------------------------------------------
Kelly Beaudin Stapleton, the U.S. Trustee for Region 3, objects to
ACandS, Inc.'s Second Amended Chapter 11 Plan of Reorganization,
saying that the company should justify the proposed release of
claims belonging to certain third-party claimants.

The Amended Plan provides for the issuance of injunctions under
Section 524(g) of the U.S. Bankruptcy Code that result in
channeling of certain asbestos-related liabilities of the Debtor
into a trust.  The Debtor said that its $449,000,000 insurance
claim against Travelers Casualty and Surety Company is its most
valuable asset.

The Debtor also said that a Trust will be created which will (i)
possess the status and features of a "qualified settlement fund"
for the purposes of Section 468B of the Internal Revenue Code,
(ii) assume the Debtor's liabilities with respect to all Asbestos
Personal Injury Claims, and (iii) use Trust Assets and income to
pay Asbestos Personal Injury Claims, as provided in the Plan and
Trust Documents.

The U.S. Trustee said in court documents that with respect to
proposed claims release, there appears to be no evidence or basis
for releasing widespread claims against certain parties and other
entities including, as defined in the Debtor's Plan, officers,
counsel, bankers, advisors, or agents of the Debtor.

To the extent that the Debtors are requesting a non-consensual
release of third-party claims, the U.S. Trustee says, the Debtor
must establish the legal and factual bases for that request.  The
U.S. Trustee reminds the U.S. Bankruptcy Court for the District of
Delaware that she reserves the right to cross-examine any
witnesses whose testimony is offered by the Debtor in support of
these provisions and to take a position on the propriety of the
releases at the confirmation hearing based upon the record.

As reported in the Troubled Company Reporter on Feb. 22, 2008,
Owens-Illinois Inc., a creditor of ACandS Inc., objected to the
Plan, arguing that a trust created under the plan has "overly
broad powers".

                        About AcandS Inc.

Based in Lancaster, Pennsylvania, ACandS Inc. was an insulation
contracting company, primarily engaged in the installation of
thermal and mechanical insulation.  In later years, the Debtor
also performed a significant amount of asbestos abatement and
other environmental remediation work.  The company filed for
chapter 11 protection on Sept. 16, 2002 (Bankr. Del. Case No. 02-
12687).

Laura Davis Jones, Esq., Curtis A. Hehn, Esq., James E. O'Neill,
Esq., and Michael Paul Migliore, Esq., at Pachulski Stang Ziehl &
Jones, P.C., represent the Debtor in its restructuring efforts.

Kathleen Campbell Davis, Esq., Aileen F. Maguire, Esq., Mark T
Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine,
LLC, represent the Official Committee of Asbestos Personal Injury
Claimants.

At Dec. 31, 2006, the Debtor disclosed that it had book assets of
approximately $11.78 million and book liabilities, including
liabilities for the payment of asbestos-related and other claims
of $11.78 million.  At June 30, 2007, net book assets before
liabilities for  asbestos-related and other claims was
approximately $9,010,000.

The Court set April 21, 2008 to consider confirmation of the
Debtor's Second Amended Chapter 11 Plan of Reorganization.


ACANTO SADDLEBACK: Sec. 341(a) Creditors Meeting Set for March 3
----------------------------------------------------------------
The United States Trustee for Region 16 will convene a meeting of
creditors in Acanto Saddleback Homes LLC's chapter 11 case, on
March 3, 2008, at 10:00 a.m., at 411 West Fourt Street, Room 1-159
in Santa Ana, California.

This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in the Debtors' case.  The Section
341(a) Meeting has been scheduled within the time required by
Rule 2003 of the Federal Rules of the Bankruptcy Procedure.

All creditors are invited, but not required, to attend.  The
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of the
Debtors under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Based in Newport Beach, California, Acanto Saddleback Homes, LLC
-- is a housing community.  The company filed for chapter 11 on
Jan. 30, 2008 (Bank.C.D.Ca. Case No. 08-10426).  Robert P. Goe,
Esq., at Goe & Forthsythe, LLP represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed estimated assets of $10 million to $50
million and estimated debts of $1 million to $10 million.


ACCEPTANCE INSURANCE: Can File Chapter 11 Plan Until May 30
-----------------------------------------------------------
The United States Bankruptcy Court for the District of Nebraska
extended Acceptance Insurance Companies Inc. and its debtor-
affiliates' exclusive period to file a Chapter 11 plan until
May 30, 2008, Bloomberg News reports.

The Court also extended the exclusive right to solicit acceptances
of that plan until July 30, 2008.

As reported in the Troubled Company Reporter on Feb. 5, 2008,
the Debtors told the Court that they need sufficient time to
negotiate and propose a Chapter 11 plan of reorganization and to
rehabilitate their business.

The Debtors related that the Official Committee of Unsecured
Creditors has retained StoneRidge Advisors LLC to assist the
Committee, as well the Debtors, with transactions that may form
the basis of a plan.

John J. Jolley, Jr., Esq., at Kutak Rock LLP in Omaha, Nebraska,
said that the Debtors have yet to resolve Granite Reinsurance
Ltd.'s $10 million claim against the Debtors, which is pending
before the Bankruptcy Appellate Panel for the Eighth Circuit Court
of Appeals.

                    About Acceptance Insurance

Headquartered in Council Bluffs, Iowa, Acceptance Insurance
Companies Inc. -- http://www.aicins.com/-- owns, either directly     
or indirectly, several companies, one of which is an insurance
company that accounts for substantially all of the business
operations and assets of the corporate groups.

The company filed for chapter 11 protection on Jan. 7, 2005
(Bankr. D. Nebr. Case No. 05-80059).  The Debtor's affiliates --
Acceptance Insurance Services Inc. and American Agrisurance Inc.
-- each filed chapter 7 petitions (Bankr. D. Nebr. Case Nos.
05-80056 and 05-80058) on Jan. 7, 2005.  John J. Jolley, Esq.,
at Kutak Rock LLP, represents the Debtor in its restructuring
efforts.  Lawyers at McGrath North Mullin & Kratz, PC LLO
represent the the Official Committee of Unsecured Creditors in
Acceptance Insurance's case.  As of December 2007, the Debtor
listed $36,326,172 in total assets and $138,187,943 in total
debts.


AIRWAY MOVING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Airway Moving & Storage, Inc.
        dba Airway Moving Systems, Inc.
        dba Airway Moving & Storage of Georgia, Inc.
        dba Nu-Jax
        P.O. Box 13009
        New Bern, NC 28561-3009

Bankruptcy Case No.: 08-01282

Type of Business: The Debtor is a moving company.

Chapter 11 Petition Date: February 27, 2008

Court: Eastern District of North Carolina (Wilson)

Judge: J. Rich Leonard

Debtor's Counsel: Trawick H. Stubbs, Jr.
                     (efile@stubbsperdue.com)
                  Stubbs & Perdue, P.A.
                  P. O. Drawer 1654
                  New Bern, NC 28563
                  Tel: (252) 633-2700
                  Fax: (252) 633-9600
                  http://www.stubbsperdue.com/

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Gran Alley Co., Inc.           N.C. 106-6            $129,232
Attention: Manager or Agent    N.C. 104-6
P.O. Box 773                   N.C. 107-6
Goldsboro, NC 27530

Charles McEachern                                    $125,000
The Gables at Wolfcreek
5228 Forsyth Road, Suite 275
Macon, GA 31210

Community Yellow Pages         N.B.K. 06, N.B.K. 07  $13,513
Attention: Manager or Agent
P.O. Box 10629
Goldsboro, NC 27532

Fisher Oil Co.                                       $9,000

City of New Bern Tax                                 $8,497

Shoppe of Crafts                                     $8,212

Security Moving                                      $6,523

Craven Co. Tax Collector                             $5,988

Eagle Transportation                                 $3,670

White Directory Publisher                            $3,560

Trans Guard General Agency                           $2,525

Bell South                                           $2,309

Embarq                                               $1,532

D.E.X.                                               $1,464

Industrial Truck                                     $1,419

Stewart Equipment                                    $1,404

East Carolina Forklifts                              $1,169

Mover Specialty Service, Inc.                        $1,070

Employment Security Committee                        $981

Wayne's Service Center                               $853


ALANCO TECH: Posts $2,005,800 Net Loss in 2nd Qtr. Ended Dec. 31
----------------------------------------------------------------
Alanco Technologies Inc. reported a net loss of $2,005,800 for the
second quarter ended Dec. 31, 2007, an increase of $1,365,400,
compared to the prior year period loss of $640,400.  

Sales for its second quarter ended Dec. 31, 2007, were
$3,770,200, a decrease of $1,820,900, compared to sales of
$5,591,100 for the same period of the prior year.  The company's
Data Storage segment (Excel Meridian Data Inc.) reported decreased
sales of $917,200 due to an unusually large $945,000 sale recorded
in the prior year second quarter that was not duplicated in the
current quarter.  

The company's Wireless Asset Management segment (StarTrak Systems)
reported a sales decrease of $814,800 due to its inability to
replace a contract with a large volume customer that significantly
increased hardware sales in the prior year second quarter.  
StarTrak's sales shortfall was further impacted by delays in its
new "Sentry" product introduction targeted at the refrigerated
truck/trailer market that had been planned for the current
quarter.

Approximately 50% of the increase in net loss resulted from a
decrease in gross profit.  The balance of the increased loss was
due to increased StarTrak SG&A expenses incurred to accelerate and
complete commercialization of the new Sentry product line and
increased corporate expenses in the quarter due to a one-time
$300,000 insurance settlement recorded in the prior year.

Robert R. Kauffman, Alanco chairman and chief executive officer,
commented, "The first half performance was obviously unacceptable,
and management responded with an aggressive corporate-wide SG&A
expense reduction program and a reorganization of StarTrak's
technical staff to focus on the critical Sentry truck/trailer
product commercialization project.  These efforts led to an
approximate $250,000 per quarter reduction in the company's SG&A
expenses and the successful introduction of the Sentry product
line in November/December, 2007."

"Currently, midway into our third quarter, each of our three
operating subsidiaries is on track to contribute to a significant
narrowing of our total company operating loss in the current
quarter, ending March 31, and realistic expectation of a complete
operating turnaround and positive EBITDA in the final quarter
ending June 30, 2008."

                          Balance Sheet

At Dec. 31, 2007, the company's consolidated balance sheet showed
$28,791,900 in total assets, $11,797,200 in total liabilities,
$856,700 in Series B preferred stock, and $16,138,000 in total
shareholders' 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?2892

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on Oct. 4, 2007,
Semple, Marchal & Cooper LLP, in Phoenix, Arizona, expressed
substantial doubt about Alanco Technologies Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the years ended June 30,
2007, and 2006.  The auditing firm reported that the company  
incurred significant losses from operations, anticipates
additional losses in fiscal 2008, and has insufficient working
capital as of June 30, 2007, to fund the anticipated losses.

                   About Alanco Technologies

Headquartered in Scottsdale, Arizona, Alanco Technologies, Inc.
(NASDAQ: ALAN) -- http://www.alanco.com/-- provides wireless    
tracking and asset management solutions through its StarTrak
Systems and Alanco/TSI PRISM subsidiaries.


AMERICAN MEDIA: Dec. 31 Balance Sheet Upside-Down by $369.0 Mil.
----------------------------------------------------------------
American Media Inc. disclosed financial results of its subsidiary
American Media Operations Inc. for the third quarter ended
Dec. 31, 2007.

At Dec. 31, 2007, American Media Operations Inc.'s consolidated
balance sheet showed $952.8 million in total assets and
$1.32 billion in total liabilities, resulting in a $369.0 million
total stockholders' deficit.

The company's consolidated balance sheet at Dec. 31, 2007, also
showed strained liquidity with $138.5 million in total current
assets available to pay $149.0 million in total current
liabilities.

The company reported a net loss of $14.0 million for the third
quarter ended Dec. 31, 2007, compared with a net loss of
$306.9 million in the corresponding period ended Dec. 31, 2006.  
For the nine months ended Dec. 31, 2007, net loss was
$31.8 million, compared with a net loss of $338.7 million in the
corresponding period ended Dec. 31, 2006.

Revenue for the third quarter of fiscal year 2008 was
$114.5 million, as compared to $107.1 million in the third quarter
of fiscal year 2007, representing a 7% increase.  For the nine
months ended Dec. 31, 2007, revenues were $367.6 million, as
compared to $346.4 million in the prior-year period, representing
a 6% increase.  

The increases in revenue during both the quarter and nine-month
periods were primarily attributable to favorable results in
advertising and newsstand revenue.  The company's Shape, Star and
Men's Fitness magazines all delivered strong performances in
calendar year 2007 versus calendar year 2006.  As measured by
Publishers Information Bureau (PIB), an independent organization
that tracks advertising carried by consumer magazines, Shape ad
pages were up 13%, Star ad pages were up 25% and Men's Fitness ad
pages were up 25%.  

All three leading AMI titles outperformed their respective
categories during calendar year 2007.  As compiled by PIB, the
category in which Shape is ranked increased 10%; the category in
which Star is ranked grew 6%; and, the category in which Men's
Fitness is ranked increased 11%.

Operating income for the third quarter of fiscal year 2008 was
$17.2 million, as compared to a loss of $302.2 million in the
third quarter of fiscal year 2007.  For the nine months ended
Dec. 31, 2007, operating income was $74.6 million, as compared to
a loss of $275.4 million in the prior-year period.  

Excluding a $305.4 million non-cash provision for impairment of
intangible assets and goodwill in the prior-year period, the
increase in operating income for the quarter and nine months ended
Dec. 31, 2007 would have been 467% and 150%, respectively.  These
increases were primarily due to the above mentioned increase in
revenue and the cost reductions generated by the company as a
result of its implementation of its management action plan.

EBITDA for the third quarter of fiscal year 2008 was
$24.0 million, as compared to $12.0 million in the third quarter
of fiscal year 2007.  For the nine months ended Dec. 31, 2007,
EBITDA was $95.0 million, as compared to $56.0 million in the
prior-year period.

At Dec. 31, 2007, the company's cash and cash equivalent balances
were $56.5 million.

                       Management Comments

AMOI chairman and chief executive officer David Pecker said, "In
our third quarter of fiscal year 2008, AMOI saw continued strong
revenue growth driven by both advertising and circulation gains
from our major titles Shape, Star and Men's Fitness, each of which
is experiencing a record advertising year."

AMOI executive vice president and chief financial officer Dean
Durbin said, "Over the first three quarters of fiscal year 2008,
we made excellent progress towards the cost-reduction and revenue-
enhancement goals we outlined in our management action plan in
February 2007.  This contributed to a 7% decrease in expenses in
the third quarter and a 7% decrease in expenses in the first nine
months of fiscal year 2008 when the non-cash provision for
impairment is excluded.  Based on our performance to date, as well
as on our projections for the fourth fiscal quarter, we fully
expect to achieve the $36.0 million target contemplated under our
management action plan."

"Looking ahead, we believe AMI is well positioned, despite an
increasingly challenging environment," concluded Mr. Pecker.  "We
have the leading titles in two of the strongest publishing
categories today, health & fitness and celebrity, and their
performance continues to be solid in the current quarter."

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?2893

                 About American Media Operations

Headquartered in Boca Raton, Florida, American Media Operations
Inc. -- http://www.americanmediainc.com/-- is a publisher in the  
field of celebrity journalism, and health and fitness magazines.
The company's publications include Star, Shape, Men's Fitness, Fit
Pregnancy, Natural Health, Muscle & Fitness, Muscle & Fitness
Hers, Flex, National Enquirer, Globe, Country Weekly, Mira!, Sun,
National Examiner and other publications.  The company is a wholly
owned subsidiary of American Media Inc.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 10, 2007,
Standard & Poor's Ratings Services affirmed its 'CCC+' corporate
credit rating on American Media Operations Inc. and raised the
rating on the company's senior secured bank loan to 'B' from 'B-'.
At the same time, S&P removed the ratings from CreditWatch with
negative implications, where they were placed on Feb. 21, 2006,
based on the company's delay in filing its financial statements.
The outlook is developing.


AMERICAN STANDARD: Expects to File for Chapter 11 Protection
------------------------------------------------------------
American Standard Building Systems expects to file for Chapter 11
bankruptcy liquidation in the coming days, blaming U.S. subprime
mortgage crisis, crash of the real estate market and lack of bank
financing, Ginny Wray of the Martinsville Bulletin reports citing
James Lester, the company's president and CEO.

The paper relates that the company, which has 57 regular workers
and 23 temporary workers, closed on Jan. 25 when the bank would
not provide it a loan.  Certain workers did not receive wages and
certain customers did not get the products they bought, Ms. Wray
disclosed.

Originally, the company planned to file for Chapter 7 liquidation
but decided to file for Chapter 11, wherein the company's counsel
will negotiate between the creditors to pump up sale proceeds and
taking care of those "who got hurt," Ms. Wray recounts quoting Mr.
Lester.

"The company has no money and neither do I," Mr. Lester said.  "No
promises can be made but there is a chance customers and employees
can get something."

Headquartered in Martinsville, Virginia, American Standard
Building Systems manufactures prefabricated wood buildings.


ATLANTIS PLASTICS: S&P Ratings Tumbles to 'D' on Covenant Defaults
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Atlantis Plastics Inc. to 'D' from 'CCC-' and its rating
on the company's $75 million junior secured term loan C due 2012
to 'D' from 'C'.  S&P removed all ratings from CreditWatch with
negative implications where they were placed on Aug. 1, 2007, when
the company announced that it was in default of certain financial
covenants under its secured credit facility.
     
At the same time, S&P lowered the rating on the company's first-
lien credit facilities, consisting of a $120 million senior
secured term loan B and a $25 million revolving credit facility
both due in 2011, to 'CCC' from 'CCC+'.
      
"The rating actions follow the company's failure to make its
interest payment on its $75 million junior secured term loan C due
2012," said Standard & Poor's credit analyst Anna Alemani.
     
The recovery rating on the first-lien facilities remains '1',
indicating expectations of very high recovery (90%-100%) following
the default.  The recovery rating on the $75 million junior
secured second-lien term loan remains at '6', indicating S&P's
expectations of negligible recovery (0%-10%).  Recovery prospects
are based on an enterprise value approach.
     
Atlantis, which has annual revenues of about $400 million,
manufactures plastic films, including stretch films and custom
films (about 64% of revenues).  Injection-molded products (about
28% of revenues) include components sold to original equipment
manufacturers, mainly in the home appliance industry, and siding
panels for the homebuilding industry and residential replacement
market.  The company's profile-extruded products (8% of revenues)
are used in recreational vehicles, mobile homes, and other
consumer and commercial products.


AVANTAIR INC: Dec. 31 Balance Sheet Upside-Down by $22.3 Million
----------------------------------------------------------------
Avantair Inc.'s consolidated balance sheet at Dec. 31, 2007,
showed $192.8 million in total assets, $200.7 million in total
liabilities, and $14.4 million in Series A convertible preferred
stock, resulting in a $22.3 million total stockholders' deficit.

At Dec. 31, 2007, the company's consolidated financial statements
also showed strained liquidity with $49.6 million in total current
assets available to pay $77.6 million in total current
liabilities.

Net loss for the second quarter of fiscal 2008 was $5.3 million
compared to a net loss of $6.6 million for the second quarter of
fiscal 2007.  Loss from operations for the second quarter of
fiscal 2008 decreased approximately 20% to $4.8 million from
$6.0 million in the year-ago quarter.

Total revenues for the second quarter of fiscal 2008 increased
approximately 60% to $28.6 million, from $17.9 million in the
second quarter of fiscal 2007.

Revenues from fractional aircraft shares sold increased
approximately 50% to $10.6 million, from $7.1 million in the year-
ago quarter.  This reflects an increase of 40% in cumulative new
aircraft shares sold to 590 at the end of the second quarter of
fiscal 2008, from 421.5 in the same period last year.  Price per
aircraft share increased to $415,000 versus $405,000 a year ago.

Revenues from maintenance and management fees increased
approximately 53% to $14.1 million for the second quarter of
fiscal 2008, from $9.2 million in the second quarter of fiscal
2007, primarily reflecting the aforementioned increase in
cumulative aircraft shares sold at Dec. 31, 2007.  Additionally,
monthly management fees increased to $9,400 during the second
quarter of fiscal 2008, compared to $8,900 in the year-ago period.

Charter card revenue increased by 200% to $2.1 million for the
second quarter of fiscal 2008, from $690,019 in the second quarter
of fiscal 2007, due to increased advertising and customer
acceptance of the charter card program resulting in an increase in
hours flown and a corresponding increase in charter card revenue.

Demonstration and other revenues, which consist of charges for
demonstration flights, fees for remarketing of used aircraft
shares, and rent and fuel sales from the company's FBO operations,
increased approximately 89% to $1.7 million for the quarter from
$941,348 in the year-ago period.

The cost of fractional aircraft shares sold increased to
$8.9 million for the three months ended Dec. 31, 2007, from
$6.4 million for the same period last year, due to the 40%
increase in the cumulative number of fractional shares sold
through Dec. 31, 2007, over the prior year.  Cost of flight
operations for the second quarter of fiscal 2008, excluding fuel
costs, were $13.4 million, or 47% of revenue, compared to
$8.3 million, or 46% of revenue, for the second quarter of fiscal
2007.  The increase is due to higher maintenance expenses and an
increase in the number of pilots hired during the quarter in
accordance with the company's plan.

Fuel expenses increased to $3.9 million for the quarter, compared
to $2.4 million in the second quarter of fiscal 2007, attributable
to the increased number of hours flown and the higher cost of
fuel.

"We are pleased to report strong year-over-year increases in all
our revenue streams, led by the more than 50% increase in
fractional shares revenue," commented Mr. Steven Santo, chief
executive officer of Avantair.  "Furthermore, while cost of flight
operations increased slightly as a percentage of revenue in the
current quarter, they were basically flat with the prior period as
we experienced significant reductions in charter and repositioning
costs due to several initiatives implemented during the quarter.

"In addition, we purchased two additional core aircraft to help
mitigate future repositioning costs to meet customer requests.  We
did experience a slight slowdown in share sales in late December,
which we believe was partly due to market seasonality, broader
economic challenges and the late delivery of aircraft at the end
of the month.  Nonetheless, fractional sales for our aircraft have
increased in January over the prior month."

G&A expenses for the second quarter of fiscal 2008 were
$4.8 million, or 17% of revenue, compared to $5.6 million, or 31%
of revenue, in the second quarter of fiscal 2007.  The decrease is
primarily due to a reduction in stock-based compensation expense
of $2.3 million, partially off-set by an increase of fixed-based
operation costs of $900,000, payroll taxes of $200,000, expenses
related to being a public company of approximately $200,000, and
other aircraft expenses of $200,000.

Depreciation and amortization was $984,673 versus $177,990 in the
prior-year period due to a reclassification of assets from
available for sale to fixed during the fourth quarter of fiscal
2007.

Selling expenses increased to $1.4 million for the three months
ended Dec. 31, 2007, from $1.0 million for the same year ago
period primarily due to an increase in advertising expenses.

Mr. Santo continued, "Our outlook for the remainder of the year
remains very positive.  We plan to take delivery of 14 total
planes in fiscal 2008, having received five of these aircraft in
the fiscal second quarter.  We also continue to aggressively
pursue new fractional shareowners.  Our charter card program
remains a strong top-line contributor and, more importantly,
enables us to reach new customers, introduce them to the aircraft
and creates a source of potential future shareowners.  In fact, in
the first six months of fiscal 2008, we converted 20% of our
charter card members to fractional shareowners.

"While we continue to closely monitor the broader economic
condition and its potential effect on our business, our new lead
generation and demo flights evidence continued strong demand,
particularly as customers begin to explore more cost-efficient
alternatives in private jet travel.  We are focused on continuing
to capitalize on this market opportunity, while improving  
operating efficiencies to position Avantair for long-term
profitability," Mr. Santo concluded.

                  Year To Date Financial Results

For the six months ended Dec. 31, 2007, total revenues increased
approximately 57% to $54.3 million, from $34.7 million for the
first six months of fiscal 2007.

Loss from operations for the first six months of fiscal 2008 was
$9.3 million versus $9.0 million in same period in fiscal 2007.
Net loss for the first half of fiscal 2008 decreased to
$10.1 million from a net loss of $10.4 million in the prior year
period.

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?2897

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on Oct. 2, 2007,
Jericho, N.Y.-based J.H. Cohn LLP expressed substantial doubt
about Avantair Inc.'s ability to continue as a going concern after
auditing the company's consolidated financial statements for the
year ended June 30, 2007.  The auditing firm pointed to the
company's recurring losses resulting and an accumulated deficit of
$56,198,527 as of June 30, 2007.  In addition, the company has a
working capital deficiency of $8,407,103 as of June 30, 2007.

                       About Avantair Inc.

Based in Clearwater, Florida, Avantair Inc. (OTC BB: AAIR) --
http://www.avantair.com/-- offers private travel solutions for  
individuals and companies at a fraction of the cost of whole
aircraft ownership.  The company is the sole North American
provider of fractional aircraft shares in the Piaggio Avanti P.180
aircraft.  The company currently manages a fleet of 39 fractional
aircraft plus 7 core planes, with another 63 Piaggio Avanti IIs on
order through 2012.  It also has announced an order of 20 Embraer
Phenom 100s.


AVENTINE RENEWABLE: Liquidity Issues Incite Failed Auctions
-----------------------------------------------------------
At Dec. 31, 2007, Aventine Renewable Energy Holdings Inc. had
invested $211.5 million in taxable auction rate securities which
it classified as current assets.  The auction rate securities held
by the company are private placement securities with long-term
stated maturities for which the interest rates are reset through a
Dutch auction every 28 days.

The auctions have historically provided a liquid market for these
securities as investors historically could readily sell their
investments at auction.  With the liquidity issues experienced in
global credit and capital markets, the auction rate securities
held by the company have experienced multiple failed auctions,
beginning on Feb. 8, 2008, as the amount of securities submitted
for sale has exceeded the amount of purchase orders.

Subsequent to Dec. 31, 2007, the company began to exit its
position in these securities.  As of Feb. 21, 2008, the company
had successfully liquidated $84.3 million of these securities,
thereby leaving us with $127.2 million invested in ARS as of
February 21.  Aventine incurred a pre-tax loss of approximately
$1.5 million in connection with these liquidations.  All of these
securities continue to carry AAA/Aaa ratings, have not experienced
any payment defaults and are backed by student loans which carry
guarantees as provided for under the federal family education loan
program of the U.S. Department of Education.  Nonetheless, if
uncertainties in the credit and capital markets continue, these
markets deteriorate further or there are any ratings downgrades on
any auction rate securities the company holds, it may be required
to recognize impairments or reclassify these investments from
short-term to long-term investments.

In addition, these securities may not provide the liquidity to us
as Aventine needs it, as it could take until the final maturity of
the underlying notes to realize its investments' recorded value.    
Currently, there is a very limited market for any of these
securities and further liquidations at this time, if possible,
would likely be at a significant discount.  Accordingly, Aventine  
does not currently intend to attempt to liquidate any more of
these securities until market conditions improve or its liquidity
needs require us to do so.  Cash and cash equivalents as of
Dec. 31, 2007 was $17.2 million.  Successful auction rate
securities liquidations completed in 2008 generated $82.8 million.

At Dec. 31, 2007, the company also had availability under its
secured revolving credit facility of $122.6 million.  The
company's total estimated remaining expenditures needed to
complete its two new facilities at Dec. 31, 2007 are estimated to
be between $295 million and $305 million approximately evenly
spent over the balance of the construction period through Q1'09.    
After utilization of the company's current available resources,
should it not be able to liquidate a substantial portion of the
remaining portfolio of these ARS securities on a timely basis and
on acceptable terms, the company will have to either attempt to
raise additional funds or slow down the construction of its new
facilities, or both.  In addition, delays in the construction of
Aventine's new facilities could expose us to material penalties.

The amount available to the company under its secured revolving
credit facility is calculated using a borrowing base.  In addition
to a component relating to inventory and receivables, there is a
fixed asset component included in this borrowing base.  The amount
of fixed assets eligible to be included as collateral in
Aventine's borrowing base at Dec. 31, 2007 was $48.2 million, and
decreases by $1.8 million each quarter thereafter.  Aventine's
liquidity facility is a $200 million facility, subject to
collateral availability, and is expandable under certain
conditions to $300 million.

                    About Aventine Renewable

Headquartered in Pekin, Illinois, Aventine Renewable Energy
Holdings Inc. (NYSE:AVR) -- http://www.aventinerei.com--   
produces and markets ethanol in the United States, based on both
the number of gallons produced and the number of gallons sold.   
Through its own production facilities, marketing alliances with
other ethanol producers and its purchase or resale operations, the
company marketed and distributed 695.8 million gallons of ethanol
during the year ended Dec. 31, 2006.  For 2006, Aventine sold
approximately 12.9% of the total volume of ethanol sold in the
United States.  The company markets and distributes ethanol to
energy companies in the United States, including Royal Dutch Shell
and its affiliates, Marathon Petroleum, BP, ConocoPhillips, Valero
Marketing and Supply Company, Exxon/Mobil, and Texaco/Chevron.  In
addition to producing ethanol, the company's facilities also
produce several co-products, such as distillers' grain, corn
gluten feed, corn germ and brewers' yeast.


AVENTINE RENEWABLE: Earns $3.2 Mil. For Fourth Qtr. Ended Dec. 31
-----------------------------------------------------------------
Aventine Renewable Energy Holdings Inc. reported net income of
$3.2 million for the three months ended Dec.31, 2007 compared to
$12.8 million net income for the 2006 fourth quarter.  For the
full fiscal year ended Dec. 31, 2007, net income was found at
$33.8 million compared to $54.9 million income for 2006.

Total net sales for the 2007 fourth quarter are $379.3 million in
comparison to $360.7 million sales for the same period of the
prior year.  For the fiscal 2007, the company's total net sales
were $1,571.6 million compared to the net sales for fiscal 2006 at
$1,592.4 million.

"We continue to successfully steer our way through a difficult
commodity environment as both income and EBITDA turned positive,"
Ron Miller, Aventine's president and chief executive officer,
said.  "While ethanol prices rose during the quarter, they did not
increase enough to allow the average price received for ethanol in
the fourth quarter to exceed the average for the third quarter."

"We were able to offset, however, the lower average ethanol price
with lower corn costs for the quarter," Mr. Miller continued.  
"Our fourth quarter corn costs averaged $3.66 per bushel, or $0.15
per bushel less than in the third quarter."

"Our co-product returns for the fourth quarter increased to 45.3%,
as prices for germ, meal, DDGS and feed all increased
significantly," Mr. Miller added.  "Overall, the commodity spread
for the quarter, defined as gross ethanol selling price per gallon
less net corn cost per gallon, increased to $1.17 per gallon, from
$1.09 in Q3'07."  

"As the commodity spread remains tight, the co-product returns
provided by our wet mill have become increasingly more important,"
Mr. Miller explained.  "Higher volumes of ethanol shipped in the
fourth quarter versus the third quarter helped reduce freight
costs per gallon, in spite of continued fuel surcharges."  

"Our plants ran at 89% of capacity during the fourth quarter of
2007 and 93% of capacity for the full year 2007 as compared to 89%
for the full year 2006," Mr. Miller added.  "The construction of
our new facilities in Aurora, Nebraska and Mt. Vernon, Indiana
continue to move forward."  

"We expect these facilities to ramp up ethanol production
beginning in Q1'09," Mr. Miller stated.  "We would like to thank
all of the U.S. Senators and Representatives that continue to
support and believe in the ethanol industry for passing the Energy
Independence and Security Act of 2007, and for President Bush
signing the bill into law."  

"Ethanol supports more than corn farmers or the ethanol industry
itself," Mr. Miller imparted.  "From seed and fertilizer companies
to heavy equipment manufacturers and independent gasoline
retailers, to local school districts in rural communities that
have received boosts in property taxes, the investments made in
ethanol by our political leadership is proving to be a wise
investment for America."  

"The passage of a new renewable fuels standard in December helped
to quell some of the concerns surrounding the supply/demand
equation," Mr. Miller elaborated.  "The new renewable fuel
standard requirement for corn based ethanol of 15 billion gallons
in 2015 exceeds, according to the Renewable Fuels Association, the
combined capacity of 13.4 billion gallons from existing producing
ethanol plants as well as those listed as currently under
construction."  

"However, we, along with others in the industry, must continue to
find and open new markets for ethanol," Mr. Miller concluded.

As of Dec. 31, 2007, the company had $762.2 million total assets,
$418.3 total debts resulting to a total stockholder's equity of
$343.9 million.

                     About Aventine Renewable
  
Headquartered in Pekin, Illinois, Aventine Renewable Energy
Holdings Inc. (NYSE:AVR) -- http://www.aventinerei.com--   
produces and markets ethanol in the United States, based on both
the number of gallons produced and the number of gallons sold.   
Through its own production facilities, marketing alliances with
other ethanol producers and its purchase or resale operations, the
company marketed and distributed 695.8 million gallons of ethanol
during the year ended Dec. 31, 2006.  For 2006, Aventine sold
approximately 12.9% of the total volume of ethanol sold in the
United States.  The company markets and distributes ethanol to
energy companies in the United States, including Royal Dutch Shell
and its affiliates, Marathon Petroleum, BP, ConocoPhillips, Valero
Marketing and Supply Company, Exxon/Mobil, and Texaco/Chevron.  In
addition to producing ethanol, the company's facilities also
produce several co-products, such as distillers' grain, corn
gluten feed, corn germ and brewers' yeast.


AVENTINE RENEWABLE: Moody's Lowers SGL Rating on Failed Auctions
----------------------------------------------------------------
Moody's Investors Service downgraded the speculative grade
liquidity rating of Aventine Renewable Energy Holdings, Inc.'s (B2
corporate family rating / stable outlook) to SGL-3 and moved the
ratings outlook to negative.  The company's B2 corporate family
rating and B3 rating on its senior unsecured notes due 2017 were
affirmed.  These summarizes the ratings.

Aventine Renewable Energy Holdings, Inc.

Ratings changes:

  -- Speculative grade liquidity rating: SGL-3 from SGL-1

Ratings affirmed:

  -- Corporate family rating: B2

  -- Probability of default rating: B2

  -- $300mm Sr unsec notes due 2017: B3, LGD5, 76%

The downgrade in the speculative grade liquidity rating follows
the disclosure by the company that approximately $127 million of
auction rate securities held as short-term investments were
illiquid as a result of experiencing failed remarketing auctions
earlier in February.  The company was able to sell approximately
$84 million of auction rate securities prior to the failed
February 8th auction, which resulted in a loss of $1.5 million.   
Cash balances and liquid marketable securities balances as of
Dec. 31, 2007, pro forma for the $84 million of sales of auction
rate securities was approximately $100 million.  It is uncertain
if the next remarketing auctions for securities held by Aventine
will be successful, however the company may have the opportunity
to sell additional securities at discounts to their par value
outside of the typical remarketing auctions.

The SGL-3 liquidity rating also reflects cash balances that are
expected to be exhausted during 2008 (to fund an estimated
$315 million to $330 million of capital expenditures), the current
unattractive commodity pricing environment, the expectation that
the company will need to fund capital expenditures with its
$200 million revolving credit facility and the generally difficult
liquidity environment that might preclude the company from raising
significant funds from uncommitted sources.  Elevated corn prices
(recently exceeding $5 per bushel) and ethanol prices that have
traded at a discount or small premium to gasoline prices are
resulting in slim margins for ethanol producers (despite favorable
federal legislation passed in December 2007 mandating increased
ethanol usage in 2008 and future years) and slightly negative cash
flow from operations in the fourth quarter of 2007 for Aventine.   
Continuation of current commodity prices could lead to meager cash
flows that would not contribute significantly to capital
expenditure requirements or improve liquidity.  It is plausible
that the company will have sufficient funds for 2008, but there
could be scenarios under which they could experience a liquidity
shortfall.  

The company noted these in its earnings announcement dated
Feb. 22, 2008: "After utilization of our current available
resources, should we not be able to liquidate a substantial
portion of the remaining portfolio of these ARS [auction rate
securities] securities on a timely basis and on acceptable terms,
we will have to either attempt to raise additional funds or slow
down the construction of our new facilities, or both.  In
addition, delays in the construction of our new facilities could
expose us to material penalties."

The negative outlook reflects the uncertainty about Aventine's
future profitability (given current commodity prices) and its
liquidity as it spends heavily on new plant construction.  
Aventine expects to spend $295 million to $305 million to complete
construction for two new ethanol plants in the first quarter of
2009 and $20 million to $25 million of other capital expenditures
in 2008.  It is expected that these expenditures will be funded
from existing cash balances and its revolving credit facility.   
While on negative outlook, factors Moody's will consider include
the company's success in selling its $127.2 million of illiquid
auction rate securities, the impact that commodity prices have on
the company's margins and Aventine's ability to generate cash flow
from operations to contribute to capital expenditure requirements
in 2008.  A deterioration in operating margins due to adverse
movements in commodity prices or further levering of Aventine's
balance sheet could put negative pressure on the rating.

Aventine is a producer and marketer in the United States of
ethanol used as a blending component for gasoline.  It produces
ethanol and co-products at its wholly-owned Pekin, Illinois wet
milling and dry milling plants, and its 78.4% owned dry milling
Aurora, Nebraska plant.  Additionally, the firm operates a
marketing alliance that pools ethanol from multiple third party
producers and sells it nationwide for which it receives a
commission.  Revenues for the FYE Dec. 31, 2007 were approximately
$1.6 billion.


BALLY TOTAL: Reaches Settlement with SEC After Fraud Allegations
----------------------------------------------------------------
Bally Total Fitness Holding Corporation and its debtor-affiliates
have reached a settlement with the U.S. Securities and Exchange
Commission concerning the SEC's investigation relating to the
restatement of the company's financial statements for 2002 and
2003 and selected financial data for 2000 and 2001.

In a lawsuit brought before the U.S. District Court in the
District of Columbia on Feb. 28, 2008, the SEC filed financial
fraud charges against against Bally alleging that the Company
violated securities law -- and misled investors -- by issuing
financial reports which fraudulently misrepresented Bally's
financial condition during the years from 1997 to 2003, reports
the Chicago Tribune.

Specifically, the SEC alleges that:

   -- from at least 1997 through 2003, Bally's financial
      statements were affected by more than two dozen accounting
      improprieties, which caused Bally to overstate its
      originally reported year-end 2001 stockholders' equity by
      nearly $1.8 billion, or more than 340%.

   -- Bally understated its originally reported 2002 net loss by
      $92.4 million, or 9341%, and understated its originally
      reported 2003 net loss by $90.8 million, or 845%.

   -- Bally violated the antifraud, reporting, books and
      records, and internal control provisions of the federal
      securities laws.

   -- Bally fraudulently accounted for (i) three types of
      revenue it received from its members: initiation fees,
      prepaid dues, and reactivation fees; and (ii) its
      membership acquisition costs.

"These frauds account for $1.2 billion of the $1.8 billion
overstatement of Bally's originally reported year-end 2001
stockholders' equity," the SEC said in its complaint.  

In addition, Bally's accounting for more than 20 other revenue or
expense items failed to conform to Generally Accepted Accounting
Principles, which account for the remaining $600 million of the
$1.8 billion overstatement of Bally's originally reported year-end
2001 stockholders' equity, said the SEC.

                          Bally Settles

In a "consent decree," says the Tribune, the suit was filed, and
Bally settled the charges simultaneously.

The company settled the proceedings without admitting or denying
the SEC's findings, according to reports.  The settlement does not
require the Company to pay a monetary penalty.

In accepting Bally's settlement offer, the SEC said, the
Commission took into account "Bally's cooperation with the
commission staff in the investigation leading to this action and
(its) prompt commencement of remedial action," reports the
Tribune.

As part of the settlement, the company has consented to a final
judgment requiring future compliance with Federal securities laws
and regulations.

Since the suit asks the Court only to enjoin Bally from future
violations, the litigation appears to be resolved.  However, the
SEC said that its investigation of events "is continuing," the
Tribune adds.

"I am pleased that the conclusion of the government investigations
puts these matters behind us as we continue to execute our
strategies for the long-term success of our business," said Don R.
Kornstein, Chairman of Bally Total Fitness.

The Department of Justice also closed the criminal investigation
involving Bally's restatement, without action against the company,
according to a statement issued by Bally.

                   About Bally Total Fitness

Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates  
fitness centers in the U.S., with over 375 facilities located in
26 states, Mexico, Canada, Korea, China and the Caribbean under
the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports Clubs
of Canada (R) brands.  Bally Total and its affiliates filed for
chapter 11 protection on July 31, 2007 (Bankr. S.D.N.Y. Case No.
07-12396) after obtaining requisite number of votes in favor of
their pre-packaged chapter 11 plan.  Joseph Furst, III, Esq. at
Latham & Watkins, L.L.P. represents the Debtors in their
restructuring efforts.  As of June 30, 2007, the Debtors had
$408,546,205 in total assets and $1,825,941,54627 in total
liabilities.

The Debtors filed their Joint Prepackaged Plan & Disclosure
Statement on July 31, 2007.  On Aug. 13, 2007, they filed an
Amended Joint Prepackaged Plan and on Aug. 17 filed a Modified
Amended Prepackaged Plan.


BELDEN INC: Board Appoints Judy Brown as Director
-------------------------------------------------
The board of directors of Belden Inc. appointed Judy Brown as a
director and member of the audit committee of the board.

Ms. Brown, 39, is executive vice president, chief financial
officer and chief accounting officer of Perrigo Company, a post
she has held since July 2006.  She joined Perrigo in September
2004 as vice president and corporate controller.  Perrigo is a  
healthcare supplier that develops, manufactures and distributes
over-the-counter and prescription pharmaceuticals, nutritional
products, active pharmaceutical ingredients and consumer products
for the store brand market.

Before joining Perrigo, Ms. Brown held various senior positions in
finance and operations at Whirlpool Corporation from 1998 to
August 2004, in Italy and the US and at Ernst & Young, 1990-1998,
in both the US and Germany.  She received a B.S. degree from the
University of Illinois and an M.B.A. from the University of
Chicago.

"We are delighted to welcome Judy Brown to Belden's board of
directors and the audit committee of the board, John Stroup,
president and chief executive officer of Belden Inc., said.  "Her
financial expertise and her background in European operations make
her a valuable addition to our board."

                         About Belden Inc.

Headquartered in St. Louis, Missouri, Belden Inc. (NYSE:BDC) --
http://www.belden.com/-- fka Belden CDT Inc., designs,  
manufactures, and markets signal transmission solutions for data
networking and specialty electronics markets including
entertainment, industrial, security and aerospace applications.

                           *     *     *

As reported in the Troubled Company Reporter on Feb. 15, 2008,
Moody's Investors Service upgraded Belden Inc.'s corporate family
ratings to Ba1 from Ba2.  The rating outlook is stable.


CALPINE CORP: Inks Geothermal Purchase Agreement With PG&E
----------------------------------------------------------
Calpine Corporation and Pacific Gas and Electric Company have
entered into a 175-megawatt geothermal power purchase agreement,
which consolidates six existing qualifying facility agreements
totaling 118MW and adding 57MW of new renewable energy to PG&E's
supply.  The Purchase Agreement will be submitted for approval to
the California Public Utilities Commission.

With this agreement, 20% of PG&E's contracts for future energy
delivery now meet California's renewable energy standard, PG&E
said in a press release.

"This agreement marks a major milestone toward meeting
California's renewable standard," said Fong Wan, PG&E's vice
president of energy procurement, said in a press release.  "PG&E
already provides our customers with some of the cleanest energy
in the nation and we will continue to aggressively add more
renewables to our portfolio."

Starting in September 2008, the agreement will deliver renewable
energy from Calpine's geothermal plants in Lake and Sonoma
Counties in northern California in an area known as The Geysers.  
The Geysers generate about 725MW, of which 375MW will go to PG&E
and the rest to other utilities like Southern California Edison.

The Geysers, which can power up to 45,000 homes, is the largest
producer of geothermal electricity in the world.  Commercial
geothermal power has been generated continuously at The Geysers
since 1960.  Geothermal energy accounts for three percent of
PG&E's current overall energy mix.

On average, more than 50% of the energy PG&E delivers comes from
carbon-free sources.  The agreement filed on February 20, 2008,
with the California Public Utilities Commission extends PG&E's
broader renewable energy portfolio.  Qualifying renewable sources
in PG&E's portfolio include solar, wind, biomass, geothermal, and
small hydroelectric.

Since July 2007, PG&E has signed renewable energy contracts
totaling 1,024 MW, including this Calpine agreement, 553 MW of
solar thermal with Solel-MSP-1, 85 MW of wind power from PPM, two
MW of wave energy with Finavera Renewables, 177 MW of solar
thermal with Ausra Inc., and 150 MW of wind energy with enXco.  
PG&E is still seeking regulatory approval for the Calpine,
Finavera, Ausra and enXco contracts.

California's Renewable Portfolio Standard (RPS) Program requires
each utility to increase its procurement of eligible renewable
generating resources by one percent of load per year to achieve a
29% renewables goal by 2010.  The RPS Program was passed by the
Legislature and is managed by California's Public Utilities
Commission and Energy Commission.

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.,
and Robert G. Burns, Esq., Kirkland & Ellis LLP represent 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 Aug. 31, 2007, the
Debtors disclosed total assets of $18,467,000,000, total
liabilities not subject to compromise of $11,207,000,000, total
liabilities subject to compromise of $15,354,000,000 and
stockholders' deficit of $8,102,000,000.

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's Amended Plan was deemed effective as of January 31,
2008.


CATHOLIC CHURCH: Objection Deadline on Calkin Retention is March 3
------------------------------------------------------------------
At the Diocese of Davenport and its Official Committee of
Unsecured Creditors' behest, the U.S. Bankruptcy Court for the
Southern District of Iowa sets March 3, 2008, as the bar date for
filing objections to the parties' application to employ Richard
M. Calkins, Esq., at Calkins Law Firm, in Des Moines, Iowa, as
special arbitrator in the bankruptcy case.

The Diocese and the Creditors Committee have previously asked for
an expedited consideration of the application because Mr. Calkins
will have to start reviewing 160 proofs of claim filed in the
case, among other tasks.

       Joint Application for Retention of Special Arbitrator

The Diocese of Davenport and its Official Committee of Unsecured
Creditors seek authority from the U.S. Bankruptcy Court for the
Southern District of Iowa to employ Mr. Calkins as special
arbitrator in the Diocese's Chapter 11 case.

Hamid R. Rafatjoo, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Los Angeles, California, relates that central to the Joint Plan
of Reorganization, which was recently filed by the Diocese and
the Creditors Committee, is the role of the Special Arbitrator.

The Plan provides that the holder of a tort claim against the
Diocese can choose to have his or her Tort Claim treated pursuant
to a convenience or matrix process.  The Special Arbitrator
determines the allowance and amount of the Tort Claim under those
two processes, Mr. Rafatjoo tells the Court.

The Special Arbitrator will also be responsible for computing the
aggregate amount of the matrix, litigation and non-releasing
litigation tort claims under the Plan, Mr. Rafatjoo says.  He
notes that for the claims processes to move efficiently and
successfully, the Special Arbitrator should begin his work before
Plan confirmation.

Mr. Calkins will be paid at the hourly rate of $200 for his
services, and $100 for travel time.  He will also be reimbursed
for necessary and reasonable costs.  He may also utilize his
paralegal staff at an hourly rate of $100.

Pre-confirmation, Mr. Calkins will make periodic applications for
compensation and reimbursement.  Payment for his staff will be
promptly and directly paid by the Diocese.

Mr. Calkin assures the Court that he is a "disinterested person"
as defined in Section 101(14) of the Bankruptcy Code.

                    About Diocese of Davenport

The Diocese of Davenport in Iowa filed for chapter 11 protection
(Bankr. S.D. Ia. Case No. 06-02229) on Oct. 10, 2006.  Richard A.
Davidson, Esq., at Lane & Waterman LLP, represents the Davenport
Diocese in its restructuring efforts.  Hamid R. Rafatjoo, Esq.,
and Gillian M. Brown, Esq., at Pachulski Stang Zhiel Young Jones &
Weintraub LLP represent the Official Committee of Unsecured
Creditors.  In its schedules of assets and liabilities, the
Davenport Diocese reported $4,492,809 in assets and $1,650,439 in
liabilities.  The Court will hear the adequacy of Davenport's
disclosure statement explaining its reorganization plan on
March 5, 2008.  (Catholic Church Bankruptcy News, Issue No. 115;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000).


CATHOLIC CHURCH: Century Balks at Davenport's Disclosure Statement
------------------------------------------------------------------
Century Indemnity Company, as successor to CCI Insurance Company
and Insurance Company of North America, objects to the Diocese of
Davenport's Disclosure Statement because it lacks adequate
information as required by Section 1125 of the Bankruptcy Code.

Richard K. Updegraff, Esq., at Brown, Winick, Graves, Gross,
Baskerville & Schoenebaum PLC, in Des Moines, Iowa, relates that
Century Indemnity is not an insurer of the Diocese, and that the
only record of insurance coverage it issued to the Diocese is a
two-day policy, effective June 18 to 20, 1968, which covered
"[a]ll activities incidental to installation of Bishop" at the
Sacred Heart Cathedral.  Mr. Updegraff notes that Century
Indemnity does not have a copy of the Policy's liability
coverage, and neither does the Diocese nor the Cathedral.

Century Indemnity, however, is included in the Plan's definition
of "Insurance Company," which includes any company that
"allegedly provided" coverage to any Catholic Entities, Mr.
Updegraff says.  He argues that the Plan appears to be designed
to abrogate virtually all basic policy rights, including the
right to control defense of tort claims against an insured,
because handling of the tort claims is put in complete control of
a special arbitrator.

Mr. Updegraff contends that the Disclosure Statement fails to
disclose any basis for the U.S. Bankruptcy Court for the Southern
District of Iowa to exercise issues over (i) tort claims against
the Cathedral, and other non-debtors, or (ii) the Policy, which,
if its terms and conditions are proved, would be a contract
between two non-debtors.  He adds that the Disclosure Statement
also fails to disclose anything about the insurance policies
allegedly issued to non-debtors, and the Plan's intended impact
on those policies, which are not property of the bankruptcy
estate.

Mr. Updegraff further contends, among other things, that the
Disclosure Statement does not disclose whether the priests, or
other perpetrators of alleged abuse at the Cathedral were
employees of the Cathedral.  He notes that the Disclosure
Statement is extraordinary in its failure to make disclosure
about insurance.  Hence, Century Indemnity asks the Court to deny
approval of the Disclosure Statement.

                    About Diocese of Davenport

The Diocese of Davenport in Iowa filed for chapter 11 protection
(Bankr. S.D. Ia. Case No. 06-02229) on Oct. 10, 2006.  Richard A.
Davidson, Esq., at Lane & Waterman LLP, represents the Davenport
Diocese in its restructuring efforts.  Hamid R. Rafatjoo, Esq.,
and Gillian M. Brown, Esq., at Pachulski Stang Zhiel Young Jones &
Weintraub LLP represent the Official Committee of Unsecured
Creditors.  In its schedules of assets and liabilities, the
Davenport Diocese reported $4,492,809 in assets and $1,650,439 in
liabilities.  The Court will hear the adequacy of Davenport's
disclosure statement explaining its reorganization plan on
March 5, 2008.  (Catholic Church Bankruptcy News, Issue No. 115;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000).


CATHOLIC CHURCH: Regina High Opposes Davenport's Bankruptcy Plan
----------------------------------------------------------------
Iowa City Regina High School objects to the Diocese of
Davenport's Joint Plan of Reorganization and accompanying
Disclosure Statement to the extent that the Plan purports or
attempts to bind Regina High to perform certain obligations set
forth in the Plan.

The Disclosure Statement is inaccurate and misleading in that it
states that the Plan terms were negotiated over four days by
certain Catholic entities, including parishes and churches
located within the territorial Diocese's limits, Paula L. Roby,
Esq., at Elderkin & Pirnie PLC, in Cedar Rapids, Iowa, argues.  
She notes that Regina High is a Catholic entity, as defined in
the Plan, but was excluded from the negotiations, even after
requesting to participate.

"Regina [High] believes that not one single 'Catholic Entity' was
allowed to participate in the negotiations," Ms. Roby tells the
U.S. Bankruptcy Court for the Southern District of Iowa.

Ms. Roby further argues that the Disclosure Statement
inaccurately describes the balloting tabulation process by
failing to note that the requirements of two-thirds in amount and
one-half in number for affirmative ballots applies only to the
number of creditors actually casting ballots, and not to the
total number of creditors in each class.

                    About Diocese of Davenport

The Diocese of Davenport in Iowa filed for chapter 11 protection
(Bankr. S.D. Ia. Case No. 06-02229) on Oct. 10, 2006.  Richard A.
Davidson, Esq., at Lane & Waterman LLP, represents the Davenport
Diocese in its restructuring efforts.  Hamid R. Rafatjoo, Esq.,
and Gillian M. Brown, Esq., at Pachulski Stang Zhiel Young Jones &
Weintraub LLP represent the Official Committee of Unsecured
Creditors.  In its schedules of assets and liabilities, the
Davenport Diocese reported $4,492,809 in assets and $1,650,439 in
liabilities.  The Court will hear the adequacy of Davenport's
disclosure statement explaining its reorganization plan on
March 5, 2008.  (Catholic Church Bankruptcy News, Issue No. 115;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000).


CATHOLIC CHURCH: Portland's Bankruptcy Reopened by Judge Perris
---------------------------------------------------------------
The Hon. Elizabeth L. Perris of the U.S. Bankruptcy Court for the
District of Oregon has reopened the bankruptcy case of the
Archdiocese of Portland in Oregon for further administration.

Erin K. Olson, Esq., at the Law Office of Erin Olson, P.C., in
Portland, Oregon, previously asked the Court to reopen the case
to resolve certain issues, including her request to unseal, and
file in redacted form, the documents and accompanying exhibits
filed as Docket Nos. 4765 and 4766 in the bankruptcy case.

Fathers Joseph Bacelleri, Donald Durand, Maurice Grammond, Gary
Jacobson, Rocco Perrone, Michael W. Sprauer, Ronald Warren, and
Chester Wrzaszczak objected to the reopening of the case.  They
complained that the case has been completed, claims have been
settled and closed, and that the matter should be at an end.
Alternatively, the priests asked the Court to refer the
disclosure issues to mediators, Judge Velure and Judge Hogan, for
mediation and arbitration, as has been previously agreed upon by
the Archdiocese and certain of the claimants' counsel.

                Documents Should Not Be Unsealed

The Archdiocese tells Judge Perris that in essence, Ms. Olson's
request to unseal seeks relief from the protective order that is
guarding the documents.

Thomas V. Dulcich, Esq., at Schwabe, Williamson & Wyatt, P.C. in
Portland, Oregon, relates that Kelly Clark, Esq., has raised the
exact same issue, which through an agreement with certain
interested parties, will be subject to a mediation with Judge
Velure commencing April 1, 2008.

Accordingly, aside from its previous request to appoint Judge
Hogan as special master or preserving the status quo with respect
to the documents at issue, the Reorganized Debtor also asks the
Court to set a briefing schedule on the issues raised by Ms.
Olson, so that the Court may be fully informed about them.

Father M, for its part, asks the Court to deny Ms. Olson's
request to unseal documents because the tort claimants have
settled their claims and the Court has closed the bankruptcy
case.  He contends that if the Court determines that Ms. Olson's
request merits attention, then, the Court should direct her to
participate in the mediation with Judge Velure, and, if
necessary, a final arbitration to be determined by Judge Hogan.

Father M points out that Ms. Olson has refused to participate in
the agreed upon mediation process, but continues to raise the
same issues that the process is designed to resolve.

Confidential defendant "Defendant Smith" asks Judge Perris to
defer consideration of Ms. Olson's request until parties complete
Judge Velure's mediation.  Defendant Smith argues that the
documents at issue consist entirely of civil discovery, which
were exchanged by certain parties under the protection of a
confidentiality agreement.  Ms. Olson, who did not represent any
party, should not be allowed to presumptively deny to those
parties the benefits of the Confidentiality Agreement, he says.

                  About Archdiocese of Portland

The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts.  Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents
the Official Tort Claimants Committee in Portland, and scores of
abuse victims are represented by other lawyers.  David A. Foraker
serves as the Future Claimants Representative appointed in the
Archdiocese of Portland's Chapter 11 case.  In its Schedules of
Assets and Liabilities filed with the Court on July 30, 2004, the
Portland Archdiocese reports $19,251,558 in assets and
$373,015,566 in liabilities.

The Court approved the Debtor's disclosure statement explaining
its Second Amended Joint Plan of Reorganization on Feb. 27, 2007.
On April 17, 2007, the Court confirmed Portland's 3rd Amended
Plan.  On Sept. 28, 2007, the Court entered a final decree closing
Portland's case.

(Catholic Church Bankruptcy News, Issue No. 115; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000).


CATHOLIC CHURCH: Spokane's Ranch Faces Suit Filed by Ex-Residents
-----------------------------------------------------------------
Three former residents of Morning Star Boys Ranch, which is
operated by the Diocese of Spokane, have filed suit in Spokane
County Superior Court, The Associated Press reports.  Thirteen
former residents previously sued the ranch over claims of abuse.

In their lawsuit, the Plaintiffs accuse Morning Star of negligent
supervision and knowingly allowing employees to abuse its
residents.  The Plaintiffs alleged that they were physically and
sexually abused by former Morning Star director, Rev. Joseph
Weitensteiner, Rev. Patrick O'Donnell and an unnamed volunteer
employee in the 1960s, 1970s and 1980s.

Rev. Weitensteiner resigned in 2006, and has denied abusing ranch
residents.

Jenn Kantz, Morning Star's spokeswoman, said that the ranch had
not seen the lawsuit and cannot comment on specific allegations,
AP says.  She was quoted as saying that the ranch is a safe and
therapeutic place.

According to AP, Rev. O'Donnell has acknowledged sexually
molesting dozens of boys over three decades.  He was named in 66
of the 176 claims alleging sexual abuse by priests in the
Diocese's bankruptcy case.

                    About The Diocese of Spokane

The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004.  Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts.

The Diocese of Spokane, the Tort Claimants Committee, the Future
Claims Representative, and the Executive Committee of the
Association of Parishes delivered an Amended Plan of
Reorganization, and a Disclosure Statement describing that Plan to
the Court on Feb. 1, 2007.  The Honorable Patricia C. Williams
approved the disclosure statement on March 8, 2007.  On April 24,
2007, the Court confirmed Spokane's 2nd Amended Joint Plan.  That
plan became effective on May 31, 2007.  (Catholic Church
Bankruptcy News, Issue No. 115; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CATHOLIC CHURCH: Tuscon Can Distribute $1 Million For Tort Claims
-----------------------------------------------------------------
The Hon. James M. Marlar of the U.S. Bankruptcy Court for the
District of Arizona approved the distribution of $1,000,000 from
funds remaining in the unknown claims reserve to the tort
claimants in the bankruptcy case of the Diocese of Tucson.

In a four-page memorandum decision, Judge Marlar noted that
decisions, which affect Unknown Claimants, must be approached
cautiously.

"The mutual effort of all involved produced a humane result.  To
move too quickly could adversely impact innocent parties whom all
have striven so diligently to protect.  Caution must therefore be
the watchword," Judge Marlar said.

The Official Committee of Tort Claimants has previously asked for
the distribution of $3,000,000 from the Unknown Claims Reserve
among allowed claims in Tiers 1 to 4, and the California Tier,
whose claims have not already been fully satisfied.

The Unknown Claims class, represented by A. Bates Butler, opposed
the Committee's request, contending that it is currently
premature, and that the amount requested was too high.  Mr.
Butler suggested that $1,000,000 is a reasonable and realistic
amount to reallocate and redistribute.

The guardian ad litem for the minor children class of claimants,
Charles L. Arnold, agreed with Mr. Butler's position.


              Instructions for Interim Distribution

In a separate order, the Court instructed and directed the
trustee of the bankruptcy settlement trust to make an interim
distribution of the funds amounting to $800,000 among the holders
of certain allowed claims in these amounts:

   -- $7,729 to each of the Tier 1 Claimants;
   -- $15,458 to each of the Tier 2 Claimants;
   -- $27,053 to California Tier Claimant No. 45;
   -- $38,647 to each of the Tier 3 Claimants; and
   -- $54,106 to each of the Tier 4 Claimants.

Judge Marlar also directed the Trustee to allocate to the Diocese
$200,000, concurrently with the claimants distributions, pursuant
to a sharing arrangement under the Diocese's confirmed plan of
reorganization.

            Panel Wants Approval on $3MM Distribution

As reported in the Troubled Company Reporter on Jan. 8, 2008,
the Official Committee of Tort Claimants of the Diocese of Tucson
asked the Court to authorize the trustee of the bankruptcy
settlement trust to distribute $3,000,000 from the funds remaining
in the unknown
claims reserve, in accordance with the Weighted Distribution
Ratio, among allowed claims in Tiers 1 to 4, and the California
Tier, whose claims have not already been fully satisfied.

                 About the Diocese of Tucson

The Roman Catholic Church of the Diocese of Tucson filed for
chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on
September 20, 2004, and delivered a plan of reorganization to the
Court on the same day.  Susan G. Boswell, Esq., Kasey C. Nye,
Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson
Diocese.  Tucson's Third Amended and Restated Plan of
Reorganization became effective on Sept. 20, 2005.  (Catholic
Church Bankruptcy News, Issue No. 115; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)


CENTRAL IOWA: McGladrey & Pullen Expresses Going Concern Doubt
--------------------------------------------------------------
McGladrey & Pullen, CPA's, raised substantial doubt about the
ability of Central Iowa Energy, LLC, to continue as a going
concern after it audited the company's financial statements for
the year ended Sept. 30, 2007.

The auditor reported that the company has suffered losses from
operations and has experienced significant increases in the input
costs for its products.  This has created liquidity issues and the
company is or, will likely be, in violation of its bank debt
covenants and there is no assurance that such violations will be
waived.

The company related that it has also been experiencing decreasing
demand for its biodiesel.  As of the fiscal year ended Sept. 30,
2007, the company operated at 97% of its nameplate capacity, but
it is currently only operating at 72% of nameplate capacity.  
Should the company continue to endure the current high raw
material costs without an increase in the price for its biodiesel,
it may have to continue to scale back or cease operations at the
biodiesel plant, either on a temporary or permanent basis. This
may affect the company's ability to generate revenues and could
decrease or eliminate the value of its units.

The company posted a net loss of $3,046,370 on total revenues of   
$36,052,541 for the year ended Sept. 30, 2007, as compared with a
net loss of $490,722 on zero revenue in the prior year.

The company stated that the total project cost for the
construction and startup of its biodiesel plant was estimated to
be approximately $50,554,000, based on the design-build agreement
it entered into with its design-builder, Renewable Energy Group,
Inc.  The company financed the construction and startup of the
plant with a combination of equity and debt capital.  

At Sept. 30, 2007, the company's balance sheet showed $51,316,608
n total assets, $31,459,046 in total liabilities and $19,857,562
stockholders' equity.

The company's consolidated balance sheet at Sept. 30, 2007, showed
strained liquidity with $11,267,545 in total current assets
available to pay $30,714,046 in total current liabilities.

A full-text copy of the company's 2007 annual report is available
for free at: http://ResearchArchives.com/t/s?2887

                       About Central Iowa

Central Iowa Energy, LLC --  http://www.centraliowaenergy.com/--   
uses vegetable oils (primarily soybean oil) and animal fats to
manufacture biodiesel. The alternative energy manufacturing
company produces domestic and renewable energy at its site on the
Iowa Interstate Railroad in Newton, Iowa.


CHRYSLER LLC: Idles Plant in Ontario Due to TRW's Workers Strike
----------------------------------------------------------------
A Chrysler LLC assembly plant in Windsor, Ontario was forced to
temporarily shut down after Canadian Auto Workers union members of
TRW Automotive Inc. went on strike Thursday due to failed wage
increase talks, according to various papers.

TRW supplies Chrysler suspension modules for Dodge Caravan and
Town & Country minivans, Dow Jones Newswires relates.

Reuters discloses citing Chrysler spokeswoman Michele Tinson that
the automaker's assembly plant in Windsor has 4,475 hourly workers
as of December 2007.  A Chrysler assembly plant in St. Louis that
also produces minivans is not affected by the rally because it
doesn't use TRW's products.

Dow Jones Newswires relates that TRW and Canadian Auto Workers
union representatives failed to reach an agreement on salary
increases, spurring the protest.

Reuters discloses that TRW spokesman John Wilkerson proposes to
maintain TRW plant production using salaried workers and hopes to
continue negotiations with the union as soon as possible.

                             About TRW

Headquartered in Livonia, Michigan, TRW Automotive, Inc., supplies
automotive systems, modules, and components to global vehicle
manufacturers and related aftermarket.  The company has three
operating segments; Chassis Systems, Occupant Safety Systems, and
Automotive Components.  Its primary business lines encompass the
design, manufacture and sale of active and passive safety related
products.  

                           About Chrysler LLC

Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital
Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R)
brand vehicles and products.  The company has dealers worldwide,
including Canada, Mexico, U.S., Germany, France, U.K.,
Argentina, Brazil, Venezuela, China, Japan and Australia.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 12, 2007,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Chrysler LLC and DaimlerChrysler Financial
Services Americas LLC and removed it from CreditWatch with
positive implications, where it was placed Sept. 26, 2007.  S&P
said the outlook is negative.


CHRYSLER LLC: Plastech to Continue Sending Supplies Until March 3
-----------------------------------------------------------------
Plastech Engineered Products Inc. and its debtor-affiliates have
agreed to continue to supply parts to Chrysler LLC until March 3,
2008, Crain's Detroit Business reports.

As reported in the Troubled Company Reporter on Feb. 22, 2008,
the Debtors and Chrysler previously agreed to an extension of
their interim production agreement, under which Plastech will
continue to manufacture and deliver component parts to Chrysler
until Feb. 27, 2008.

Pursuant to the initial interim agreement between the parties:

   -- Chrysler was obligated to make certain payments to
      Plastech in conjunction with the continued production of
      component parts; and

   -- The Debtors are to allow BBK, as agents for Chrysler, to
      have supervised access to Plastech facilities for the
      purpose of inspecting and conducting an inventory of all
      tooling used for Chrysler production.

The U.S. Bankruptcy Court for the Eastern District of Michigan
denied Chrysler LLC's request to pull out the tooling equipment
from Plastech's plants a few weeks ago.

                    About Plastech Engineered

Based in Dearborn, Michigan, Plastech Engineered Products, Inc. --
http://www.plastecheng.com/-- is full-service automotive
supplier of interior, exterior and underhood components.  It
designs and manufactures blow-molded and injection-molded plastic
products primarily for the automotive industry.  Plastech's
products include automotive interior trim, underhood components,
bumper and other exterior components, and cockpit modules.  
Plastech's major customers are General Motors, Ford Motor Company,
and Toyota, as well as Johnson Controls, Inc.

Plastech is a privately held company and is the largest family-
owned company in the state of Michigan.  The company is certified
as a Minority Business Enterprise by the state of Michigan.  
Plastech maintains more than 35 manufacturing facilities in the
midwestern and southern United States.  The company's products are
sold through an in-house sales force.

The company and eight of its affiliates filed for Chapter 11
protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08-
42417).  Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher &
Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C.,
represent the Debtors in their restructuring efforts.  The Debtors
chose Jones Day as their special corporate and litigation counsel.  
Lazard Freres & Co. LLC serves as the Debtors' investment bankers,
while Conway, MacKenzie & Dunleavy provide financial advisory
services.  The Debtors also employed Donlin, Recano & Company as
their claims and noticing agent.

An Official Committee of Unsecured Creditors has been appointed in
the Debtors' cases.

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.

                       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.


CITICORP MORTGAGE: Fitch Rates $1.392MM Class B-4 Certs. at BB
--------------------------------------------------------------
Citicorp Mortgage Securities, Inc.'s REMIC pass-through
certificates, series 2008-1, are rated by Fitch as:

  -- $297,142,648 classes IA-1, IA-2, IA-IO, IIA-1, IIA-IO and
     A-PO certificates (senior certificates) 'AAA';
  -- $5,875,000 class B-1 'AA';
  -- $2,010,000 class B-2 'A';
  -- $927,000 class B-3 'BBB';
  -- $1,392,000 non-offered class B-4 'BB';
  -- $463,000 non-offered class B-5 'B'.

The 'AAA' rating on the senior certificates reflects the 3.90%
credit enhancement provided by the 1.90% class B-1, the 0.65%
class B-2, the 0.30% class B-3, the 0.45% non-offered class B-4,
the 0.15% non-offered class B-5, and the 0.45% non-offered and
non-rated class B-6.  Fitch believes the above credit enhancement
will be adequate to support mortgagor defaults as well as
bankruptcy, fraud and special hazard losses in limited amounts.   
In addition, the ratings reflect the quality of the mortgage
collateral, strength of the legal and financial structures, and
CitiMortgage, Inc.'s servicing capabilities (rated 'RPS1' by
Fitch) as primary servicer.

The certificates represent ownership in a trust fund, which
consists primarily of 523 one-to four-family conventional, fixed-
rate mortgage loans secured by first liens on residential mortgage
properties.  As of the cut-off date (Feb. 1, 2008), the mortgage
pool has an aggregate principal balance of approximately
$309,201,928, a weighted average original loan-to-value ratio of
70.67%, a weighted average coupon of 6.822%, a weighted average
remaining term to maturity of 343 months, and an average balance
of $591,208.  The mortgage loans consist of 100% fixed rate loans.
The weighted average credit score of the mortgage loans is
expected to be approximately 727.  The loans are primarily located
in California (26.67%), New York (10.39%) and Florida (7.73%).

The mortgage loans were originated or acquired by CMI and in turn
sold to CMSI.  A special purpose corporation, CMSI, deposited the
loans into the trust, which then issued the certificates. U.S.
Bank National Association (rated 'AA-/F1+' by Fitch) will serve as
trustee.  For federal income tax purposes, an election will be
made to treat the trust fund as one or more real estate mortgage
investment conduits.


CLOROX COMPANY: Prices $500 Million Offering of 5% Senior Notes
---------------------------------------------------------------
The Clorox Company has priced the offering of $500 million
aggregate principal amount of its 5% senior notes due 2013 in an
underwritten registered public offering.

The offering was made pursuant to an effective shelf registration
statement Clorox filed with the Securities and Exchange Commission
on Oct. 3, 2007.  The offering is expected to close on March 3,
2008, subject to customary closing conditions.  Clorox intends to
use the net proceeds from the offering to retire commercial paper.  

Citigroup Global Markets Inc., J.P. Morgan Securities Inc. and
Wachovia Capital Markets LLC acted as joint lead book-running
managers.

Copies of preliminary prospectus supplement and an accompanying
prospectus are available by contacting:

     a) Citigroup Global Markets Inc.
        388 Greenwich St.
        New York, NY 10013
        Tel (877) 858-5407

     b) J.P Morgan Securities Inc.
        270 Park Ave.
        New York, NY 10017
        Tel (212) 834-4533

     c) Wachovia Capital Markets LLC
       301 South College St.
       Charlotte, NC 28202
       Tel (800) 326-5897

                      About The Clorox Company

Headquartered in Oakland, California, The Clorox Company (NYSE:
CLX) -- http://www.thecloroxcompany.com/-- manufactures and  
markets household cleaning products with fiscal year 2007
revenues of US$4.8 billion.  Clorox markets some of consumers'
most trusted and recognized brand names, including its namesake
bleach and cleaning products, Green Works(TM) natural cleaners,
Armor All(R) and STP(R) auto-care products, Fresh Step(R) and
Scoop Away(R) cat litter, Kingsford(R) charcoal, Hidden
Valley(R) and K C Masterpiece(R) dressings and sauces, Brita(R)
water-filtration systems, Glad(R) bags, wraps and containers,
and Burt's Bees(R) natural personal care products.

Clorox has manufacturing facilities in China, Costa Rica,
Dominican Republic, Malaysia, Panama, Peru, United Kingdom,
among others.

At Dec. 31, 2007, Clorox's balance sheet showed total assets of
$4.85 billion and total liabilities of $5.4 billion, resulting to
a stockholders' deficit of $0.55 billion.


COLTRANE CLO: Fitch Cuts Ratings to "CC" on 4 Classes of Notes
--------------------------------------------------------------
Fitch Ratings has downgraded 4 classes of notes issued by Coltrane
CLO p.l.c.  All classes remain on Rating Watch Negative by Fitch.  
These rating actions are effective immediately:

  -- EUR26,000,000 class B notes to 'CC' from 'CCC';
  -- EUR45,000,000 class C notes to 'CC' from 'CCC';
  -- EUR1,750,000 class D-1 notes to 'CC' from 'CCC';
  -- EUR2,000,000 class D-2 notes to 'CC' from 'CCC'.

On Feb. 25, 2008, Fitch received notice that Coltrane CLO p.l.c.
had entered into an Event of Default as a result of a Threshold
Value Event which remained uncured for five business days.  Fitch
has not received confirmation that the Controlling Class or the
Trustee plan to liquidate the underlying loan collateral in the
immediate near term.  In the event that the Controlling Class or
the Trustee chooses to liquidate the underlying loan collateral,
subsequent rating action may be taken.

Of note, since the last rating action on Feb. 20, 2008 in which
Fitch downgraded 24 classes from nine total rate of return
collateralized loan obligations, loan prices in the secondary
market, as reported by the Loan Syndications and Trading
Association, have remained relatively stable, slightly increasing
to 86.84 as of Feb. 26, 2008 from 86.27 as of Feb. 15, 2008.  As a
result, the cushions in the transactions which have not yet
breached their TRS termination or liquidation triggers remain
relatively stable.  Also, Fitch has confirmed that three
transactions have enacted amendments or entered into agreements
outside of the transaction to avoid breaching a termination
trigger, or to prevent a liquidation of the portfolio in the case
where a termination trigger has been breached.


COMMODORE CDO: Moody's Reviews Junk Rating on $17.5 Million Notes
-----------------------------------------------------------------
Moody's Investors Service downgraded and left on review for
possible downgrade these notes issued by Commodore CDO I, Limited.

Class Description: $17,550,000 Class C Floating Rate Notes

  -- Prior Rating: Ba2, on review for possible downgrade
  -- Current Rating: Caa2, on review for possible downgrade

According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.


COMMUNITY HEALTH: Posts $88MM Net Loss in Qtr. Ended December 31
----------------------------------------------------------------
Community Health Systems Inc. reported financial and operating
results for the three months and year ended Dec. 31, 2007.

The company's net loss for three months was $88.26 million
compared to net income of $53.62 million for the same period in
the previous year.

The company's net income for full year was $30.29 million compared
to net income of $168.26 million in 2006.

The consolidated financial results for the three months ended
Dec. 31, 2007, reflect a 102.1% increase in total admissions
compared with the same period in 2006.  This increase is primarily
attributable to hospitals acquired during 2007, including the
former Triad hospitals.

The company completed its acquisition of Triad Hospitals Inc. on
July 25, 2007.  With completion of the Triad acquisition, the
company enhanced the scope of its operations and geographic
diversity.  Financial and statistical data reported includes
Triad's operating results from July 25, 2007.

In conjunction with the acquisition of Triad and the integration
of the former Triad hospitals' accounting processes into the
company, and a review of the company's contractual and bad debt
allowances, various analyses were performed to assess the net
realizable value of accounts receivable, including an updated
analysis of historical cash collections.

These analyses resulted in updating the assumptions used by the
former Triad hospitals and management, well as changing the
company's own estimates.  Based upon these analyses, the financial
results for the three months and year ended Dec. 31, 2007, include
a change in estimates of the company's contractual and bad debt
allowances.

The acquisition of Triad necessitated changes in both companies'
methodologies, well as provided additional data and a larger
comparative population on which to base the company's estimates.
The information developed from these analyses indicated lower
rates of collectability resulting in the company increasing its
contractual reserves and its allowance for doubtful accounts.

The company believes these lower collectability rates are the
result of an increase in the number of patients qualifying for
charity care, reduced enrollment in certain state Medicaid
programs and an increase in the number of patients who are
indigent non-resident aliens.

The impact of these changes decreased accounts receivable by
$166.4 million, reduced net operating revenues by $96.3 million
and increased the provision for bad debts by $70.1 million. This
change reduced income from continuing operations by
$105.4 million for the three months and year ended Dec. 31, 2007.
     
Excluding the change in estimates, net operating revenues for the
three months ended Dec. 31, 2007, totaled $2.625 billion, a 137.6%
increase compared with $1.105 billion for the same period in 2006.      

Including the change in estimates, net operating revenues for the
three months ended Dec. 31, 2007, totaled $2.528 billion, a 128.9%
increase compared with $1.105 billion for the same period in 2006.

"Our fourth quarter performance capped off a year of significant
growth and progress for Community Health Systems," Wayne T. Smith,
chairman, president and chief executive officer of Community
Health Systems Inc., said. "We reached an important milestone in
2007 with the completion of the Triad acquisition and we have
continued to focus on the integration of the Triad facilities into
our portfolio of hospitals.  We intend to build on our past
success as a proven operator and leverage these assets to further
extend our record of growth."
     
During 2007, the company completed the acquisition of Triad
Hospitals, Inc., well as the acquisition of hospitals in Ruston,
Louisiana, and Valparaiso, Indiana.

"We have continued to identify and execute on suitable acquisition
opportunities," Mr. Smith added.  "With the Triad acquisition, we
have greatly expanded our market reach, and, more importantly,
created the opportunity to enhance the level of healthcare in more
communities throughout the country.  Looking ahead, we will
continue to pursue our strategy of recruiting qualified
physicians, making suitable capital investments in our existing
facilities and adding essential healthcare services that meet the
needs of each community.  We are excited about our prospects for
2008 and we remain focused on delivering value to both our
shareholders and the communities we serve."

At Dec. 31, 2007, the company's balance sheet showed total assets
of $13.49 billion, total liabilities of $11.79 billion and total
stockholders' equity of $1.71 million.

              About Community Health Systems Inc.

Located in the Nashville, Tennessee, suburb of Franklin, Community
Health Systems Inc. -- http://www.chs.net/-- (NYSE: CYH) operates   
general acute care hospitals in non-urban communities throughout
the United States.  Through its subsidiaries, the company
currently owns, leases or operates 80 hospitals in 23 states.  Its
hospitals offer inpatient medical and surgical services,
outpatient treatment and skilled nursing care.

                         *     *     *

Standard & Poor's Ratings Services placed Community Health Systems
Inc.'s long term foreign and local issuer credit ratings at 'B+'
in June 2007.  The ratings still hold to date.


CORNERSTONE MINISTRIES: Wants Scroggins & Williamson as Counsel
---------------------------------------------------------------
Cornerstone Ministries Investments Inc., asks the U.S. Bankruptcy
Court for the Northern District of Georgia for permission to
employ Scroggins & Williamson as its bankruptcy counsel.

Scroggins & Williamson will:

  a. prepare pleadings and applications;

  b. conduct examinations;

  c. advise the applicants of its rights, duties and obligations
     as debtor-in-possession;

  d. consult the applicant and represent it with respect to a
     Chapter 11 plan;

  e. perform legal services incidental and necessary to the
     day-to-day operation of the applicant's business including,
     but not limited to, institution and prosecution of necessary
     legal proceedings and general business and corporate legal
     advice and assistance;

  f. take any and all actions incidental to the proper
     preservation and administration of the applicant's estate and
     business.

The firm will be paid in its ordinary rates of $250 to $350 per
hour for attorneys, and $75 per hour for legal assistants.

To the best of the Debtor's knowledge, J. Robert Williamson, Esq.,
an attorney of the firm, represents no interest adverse to it in
matters upon which the firm is to be engaged.

Scroggins & Williamson can be reached at:

     J Robert Williamson
     1500 Candler Building
     127 Peachtree Street, NE
     Atlanta, Georgia 30303
     Tel: (404) 893-3880     

Headquartered in Cumming, Georgia, Cornerstone Ministries
Investments Inc. -- http://www.cmiatlanta.com/-- is engaged in  
financing the acquisition and development of facilities for use by
churches, faith-based or non-profit organizations and for-profit
organizations.  The company offers development, construction,
bridge and interim loans, usually due within one to three years.   
The company makes loans to four distinct groups of borrowers,
including churches, senior housing facilities, family housing
development projects and daycare/faith-based schools.

The company filed for Chapter 11 protection on Feb. 10, 2008 (N.D.
Ga. Case No. 08-20355).  J. Robert Williamson, Esq., at Scroggins
and Williamson, represents the Debtor.  When the Debtor filed for
protection from its creditors, it listed assets was $159,118,892
and debts of $153,847,984.


CORNERSTONE MINISTRIES: Wants Miller & Martin as Outside Counsel
----------------------------------------------------------------
Cornerstone Ministries Investments, Inc. asks the United States
Bankruptcy Court for the Northern District of Georgia for
authority to employ Miller & Martin, P.L.L.C. as its principal
outside counsel.

Miller & Martin, P.L.L.C. is expected to:

   a. serve as federal securities counsel, which has involved,
      among other things, assisting the Debtor with the
      preparation and filing of two post-effective amendments to
      the Debtor's Form SB-2 registration statement with the
      United States Securities and Exchange Commission related to
      the Debtor's offering of its Series G bonds; assisting the
      Debtor with the review and filing of various Form 8-K
      filings; assisting the Debtor with the review of a proxy
      statement that was filed by the Debtor in 2007; and fielding
      inquiries by representatives of the Debtor regarding
      compliance with federal securities laws;

   b. assist the Debtor in negotiations with state securities
      regulators in the States of Virginia, North Carolina and
      Georgia related to various securities matters, including
      issues related to disclosures in registration statements
      that were filed prior to Miller & Martin's representation of
      the Debtor;

   c. prepare commercial loan documents and closing commercial
      loan transactions involving loans by the Debtor to various
      borrowers, using commitment letters and term sheets pre-
      approved by the Debtor, the majority of which involved
      modifications and amendments to existing loan documents;

   d. represent the Debtor as a borrower in certain commercial
      loan transactions involving loans from First United Bank, a
      lender based in Arkansas, the principal amounts of which
      totaled $6,000,000;

   e. prepare loan participation agreements with respect to
      certain existing loans of the Debtor;

   f. represent the Debtor's wholly-owned subsidiary, C.M.I. Asset
      Pool I, L.L.C., in the performance of its rights and
      obligations under a revolving loan agreement between such
      subsidiary and Bernard National Senior Funding, Ltd. dated
      Aug. 31, 2006, including the negotiation of payoffs of
      existing borrowings under such agreement, and the
      negotiation of the replacement of eligible loans under such
      agreement; and

   g. provide ongoing general representation and general legal
      advice as to general corporate, finance and securities
      matters, including providing necessary transactional
      background and other information and related communications
      with representatives of the Debtor and its general
      bankruptcy counsel, Scroggins & Williamson, as and when
      appropriate.

The Debtor will pay Miller & Martin at it standard hourly rates.:

      Designation     Rate
      ------------    ----
      Attorneys       $165 to $610
      Document Clerks $100 to $210
      Paralegals      $100 to $210

      Professional                 Designation     Rate
      ------------                 -----------     ----
      David A. Flanigan, Jr., Esq. Partner         US$390
      Michael Marshall, Esq.       Partner         US$355
      Robert Dann, Esq.            Partner         US$350
      William Eiselstein, Esq.     Partner         US$355

The Debtor believe that the employment of Miller & Martin is
necessary and in the best interest of its estates.  To the best of
Debtor's knowledge, the firm does not currently hold any adverse
interest to the former's estate.

Headquartered in Cumming, Georgia, Cornerstone Ministries
Investments, Inc.-- http://www.cmiatlanta.com/--offers financial  
assistance in the form of bridge, construction, development, and
interim loans to four non-profit groups: churches, daycare and
faith-based schools, family housing developments, and senior
housing facilities.  Founded in 1985 as Presbyterian Investors
Fund, it began providing loans to for-profit agencies in late 2004
as long as the projects meet certain criteria (primarily
affordable housing and senior living facilities).

The Debtor filed for Chapter 11 protection on Feb. 10, 2008,
(Bankr. N.D. Ga. Case No. 08-20355).  J. Robert Williamson, Esq.
at Scroggins and Williamson represented the Debtor in its
restructuring efforts.  The Debtor listed total assets at
$159,118,892 and total debts at $153,847,984 at the time of
filing.


CORNERSTONE MINISTRIES: Wants eNable Business as Financial Advisor
------------------------------------------------------------------
Cornerstone Ministries Investments, Inc. asks the United States
Bankruptcy Court for the Northern District of Georgia for
authority to employ eNable Business Solutions, Inc. as its
investment and financial advisor on Feb. 13, 2008, pursuant to a
prepetition advisory agreement entered into on Aug. 1, 2004.

According to the pre-petition advisory agreement, eNable Business
Solutions is expected to continue to:

   a. serve as the investment and financial advisor and provide
      research and economic and statistical data in connection
      with the Debtor's assets and investment policies;

   b. provide the daily management and perform and supervise the
      various administrative functions reasonably necessary for
      the management of the Debtor, including cash management
      services;

   c. locate, analyze and select potential investments in mortgage
      loans, bonds or other investments; structure and negotiate
      the terms and conditions of transactions pursuant to which
      investments in mortgage loans will be made by the Debtor;
      make investments in mortgage loans, bonds and other
      investments on behalf of and in compliance with the
      investment objectives and policies of the Debtor; arrange
      for financing and refinancing and make other changes in the
      asset or capital structure of investments in mortgage loans,
      bonds and other investments; sell, dispose of, reinvest the
      proceeds from the sale of, or otherwise deal with the
      investments in mortgage loans, bonds and other investments
      on behalf of and in compliance with the investment
      objectives and policies of the Debtor; and enter into leases
      and services contracts and, to the extent necessary, perform
      all other operational functions for the maintenance and
      administration of the Debtor's assets;

   d. negotiate with banks or lenders for loans, and negotiate
      with investment banking firms and brokers-dealers or
      negotiate private sales of shares, bonds and other
      securities all on behalf of the Debtor, but in no event in
      such a way so that eNable Business Solutions will be acting
      as a broker-dealer or underwriter; and provided, further,
      that any fees and costs payable to third parties incurred by  
      eNable Business Solutions will be the responsibility of the
      Debtor;

   e. investigate, select and engage and conduct business on
      behalf of the Debtor with such persons as eNable Business
      Solutions deems necessary to the proper performance of its
      obligations hereunder, including but not limited to
      consultants, accountants, correspondents, lenders, technical
      advisors, attorneys, brokers, underwriters, corporate
      fiduciaries, escrow agents, depositaries, custodians, agents
      for collection, insurers, insurance agents, banks, builders,
      developers, property owners, mortgagors, and any and all
      agents, including affiliates of eNable Business Solutions,
      and persons acting in any other capacity deemed by eNable
      Business Solutions necessary or desirable for the
      performance of any of the services, including but not
      limited to entering into contracts in the name of the
      Debtor;

   f. consult with the officers and directors of the Debtor and
      assist them in the formulation and implementation of
      financial policies, and, as necessary, furnish them with
      advice and recommendations with respect to the making of
      investments consistent with the investment objectives and
      policies of the Debtor in connection with the borrowings
      proposed to be undertaken by the Debtor;

   g. obtain reports (which may be prepared by eNable Business
      Solutions or its affiliates), where applicable, concerning
      the value of investments or contemplated investments of the
      Debtor;

   h. from time to time, or at any time reasonably requested by
      the directors, make reports to the directors of its
      performance of services to the Debtor under this agreement;

   i. do all things necessary to assure its ability to render the
      services described in this agreement;

   j. deliver to or maintain on behalf of the Debtor copies of all
      appraisals obtained in connection with the investments in
      properties and mortgage loans; and

   k. notify the Board of Directors of all proposed material
      transactions before they are completed.

The Debtor will still pay eNable Business Solutions according to
the pre-petition advisory agreement:

   a. a monthly management fee equal to 10% of the former's gross
      income plus 30% of the latter's income received from lan
      participation agreements.

   b. a loan origination fee equal to 30% of the loan fees
      realized by the Debtor.

In addition, independent directors of the Debtor will determine at
least annually whether or not the compensation payed for eNable
Business Solutions's services is reasonable.  Based on such
determination, the Debtor will adjust the compensation in any
renewal of the pre-petition advisory agreement, so that such
compensation is reasonable.

The Debtor believe that the employment of eNable Business
Solutions is necessary and in the best interest of its estates.  
To the best of the Debtor's knowledge, the firm does not currently
hold any adverse interest to the former's estate.

Headquartered in Cumming, Georgia, Cornerstone Ministries
Investments, Inc.-- http://www.cmiatlanta.com/--offers financial  
assistance in the form of bridge, construction, development, and
interim loans to four non-profit groups: churches, daycare and
faith-based schools, family housing developments, and senior
housing facilities.  Founded in 1985 as Presbyterian Investors
Fund, it began providing loans to for-profit agencies in late 2004
as long as the projects meet certain criteria (primarily
affordable housing and senior living facilities).

The Debtor filed for Chapter 11 protection on Feb. 10, 2008,
(Bankr. N.D. Ga. Case No. 08-20355).  J. Robert Williamson, Esq.
at Scroggins and Williamson represented the Debtor in its
restructuring efforts.  The Debtor listed total assets at
$159,118,892 and total debts at $153,847,984 at the time of
filing.


CORNERSTONE MINISTRIES: Schedules Filing Period Moved to March 11
-----------------------------------------------------------------
The Hon. Robert Brizendine of the U.S. Bankruptcy Court for the
Northern District of Georgia, Gainesville Division, set March 11,
2008, as the deadline within which Cornerstone Ministries
Investments Inc. is required to file its schedules of assets and
liabilities, and statements of financial affairs.

The Court finds that the Debtor needs additional time to prepare
its schedules and statements, gather information from books,
records and documents pertaining to a multitude of transactions,
as the debtor pointed out.

Headquartered in Cumming, Georgia, Cornerstone Ministries
Investments Inc. -- http://www.cmiatlanta.com/-- is engaged in  
financing the acquisition and development of facilities for use by
churches, faith-based or non-profit organizations and for-profit
organizations.  The company offers development, construction,
bridge and interim loans, usually due within one to three years.   
The company makes loans to four distinct groups of borrowers,
including churches, senior housing facilities, family housing
development projects and daycare/faith-based schools.

The company filed for Chapter 11 protection on Feb. 10, 2008 (N.D.
Ga. Case No. 08-20355).  J. Robert Williamson, Esq., at Scroggins
and Williamson, represents the Debtor.  When the Debtor filed for
protection from its creditors, it listed assets was $159,118,892
and debts of $153,847,984.


CRDENTIA CORP: Completes $10 Million Long Term Debt Financing
-------------------------------------------------------------
Crdentia Corp. completed a $10.2 million long-term debt financing
with ComVest Capital LLC, based in Palm Beach, Florida.  Proceeds
will be used to replace Crdentia's existing credit facility and
for general working capital purposes.

The $10.2 million financing consists of a two-year $5.2 million
Revolving Credit Note, bearing interest at the greater of the
Prime Rate plus 2% or 8.5%, and two separate two-year term loans,
each amounting to $2.5 million and bearing annual interest of
12.5%.

"We are pleased to have completed this long-term financing that
reduces Crdentia's overall borrowing costs while enhancing our
financial flexibility with the addition of substantial working
capital," John Kaiser, CEO of Crdentia said.  "Crdentia is now on
a much stronger financial footing as we move forward with our
objectives of achieving profitability through improved operating
performance and executing our growth initiatives to bolster our
presence in key Sun Belt markets."

Headquatered in Dallas, Texas, Crdentia Corp. (OTCBB: CRDT)
-- http://www.crdentia.com/-- is a provider of healthcare
staffing services to 1,500 healthcare providers in 49 states.
Crdentia provides temporary healthcare staffing comprised of
travel and per diem nursing, locum tenens, and allied healthcare
staffing.

                       Going Concern Doubt

KBA Group LLP, in Dallas, expressed substantial doubt about
Crdentia Corp.'s ability to continue as a going concern after
auditing the company's consolidated financial statements for the
years ended Dec. 31, 2006, and 2005.  The auditing firm reported
that the company has incurred net losses totaling $16.1 million
and $6.3 million for the years ended Dec. 31, 2006, and 2005,
respectively, and has used cash flows from operating activities
totaling $4.1 million and $5.1 million for the years ended
Dec. 31, 2006, and 2005.  Additionally, at Dec. 31, 2006, the
company's current liabilities exceed their current assets by $8.1
million.

In the company's financial report ended Sept. 30, 2007, it related
certain conditions that raise substantial doubt about its ability
to continue as a going concern.  The company generated net loss of
$12,902,861 and used cash in operations of $3,661,367 during the
nine months ended Sept. 30, 2007.  Additionally, the company
needed to raise additional funds during the next 12 months to
satisfy debt service requirements of approximately $2.5 million
due in January 2008, and working capital needs of between $500,000
and $1,000,000 over the next 12 months.


CREDIT-SUISSE: Fitch Cuts Rating on $500,000 Cl. B-3 Certs. to BB
-----------------------------------------------------------------
Fitch Ratings has taken these rating actions on one Credit-Suisse
First Boston mortgage pass-through certificates.  Unless stated
otherwise, any bonds that were previously placed on Rating Watch
Negative are removed.  Affirmations total $74.5 million and
downgrades total $500,000.  Additionally, $2.2 million remains on
Rating Watch Negative.

CSFB Seasoned Loan Trust 2006-1
  -- $66.3 million class A affirmed at 'AAA';
  -- $4.7 million class M-1 affirmed at 'AA';
  -- $3.5 million class M-2 affirmed at 'A';
  -- $1.5 million class B-1 rated 'BBB+', remains on Rating Watch
     Negative;

  -- $0.7 million class B-2 rated 'BBB', remains on Rating Watch
     Negative;

  -- $0.5 million class B-3 downgraded to 'BB' from 'BBB-'.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 11.42%;
  -- Weighted Average Seasoning as of the Cut-Off Date: 107
     months.

The rating actions are based on changes that Fitch has made to its
subprime loss forecasting assumptions.  The updated assumptions
better capture the deteriorating performance of pools from 2007,
2006 and late 2005 with regard to continued poor loan performance
and home price weakness.  


CREDIT SUISSE: Fitch Chips Ratings on $113.2 Million Certificates
-----------------------------------------------------------------
Fitch Ratings has taken these rating actions on Credit Suisse
First Boston Mortgage Securities Corp. Home Equity Mortgage Trust
mortgage pass-through certificates.  Downgrades total
$113.2 million.  In addition, $188 million was placed or remains
on Rating Watch Negative.  Break Loss percentages and Loss
Coverage Ratios for each class, rated 'B' or higher, are included
with the rating actions as:

CSFB HEMT 2006-2 Group 1 (100% Second Liens)
  -- $67.7 million class 1A-1 rated 'AAA' (BL: 71.88, LCR: 1.58),
     placed on Rating Watch Negative;

  -- $25.7 million class 1A-2 downgraded to 'BBB' from 'A+'
     (BL: 61.08, LCR: 1.34);

  -- $25.7 million class 1A-3 downgraded to 'BB' from 'A-'
     (BL: 51.73, LCR: 1.14);

  -- $15.7 million class 1M-1 downgraded to 'CC/DR4' from 'BBB';
  -- $18.2 million class 1M-2 downgraded to 'C/DR6' from 'BB';
  -- $7 million class 1M-3 downgraded to 'C/DR6' from 'BB-';
  -- $8.7 million class 1M-4 downgraded to 'C/DR6' from 'B';
  -- $7.3 million class 1M-5 remains at 'C/DR6';
  -- $5.6 million class 1M-6 remains at 'C/DR6';
  -- $6.4 million class 1M-7 remains at 'C/DR6';

Deal Summary
  -- Originators: Various
  -- 60+ day Delinquency: 14.2%;
  -- Realized Losses to date (% of Original Balance): 10.16%;
  -- Expected Remaining Losses (% of Current Balance): 45.57%;
  -- Cumulative Expected Losses (% of Original Balance): 35.15%.

CSFB HEMT 2006-2 Group 2 (100% HELOCS)
  -- $112.9 million class 2A-1 rated 'AA' (BL: 20.43, LCR: 0.72),
     remains on Rating Watch Negative;

  -- $2.2 million class 2M-1 downgraded to 'C/DR6' from 'BB-';
  -- $2.5 million class 2M-2 downgraded to 'C/DR6' from 'B+';

Deal Summary
  -- Originators: Various
  -- 60+ day Delinquency: 6.3%;
  -- Realized Losses to date (% of Original Balance): 2.99%;
  -- Expected Remaining Losses (% of Current Balance): 28.35%;
  -- Cumulative Expected Losses (% of Original Balance): 16.68%.

The rating actions are based on deterioration in the relationship
between credit enhancement and expected losses and reflect
continued poor loan performance and home price weakness.  Minimum
LCR's specifically for subprime second lien transactions are: AAA:
2.00; AA: 1.75; A: 1.50; BBB: 1.30; BB 1.10; B: 1.00.


DEALMAKER DEVELOPMENTS: Voluntary Chapter 11 Case Summary
---------------------------------------------------------
Debtor: Dealmaker Developments, L.L.C.
        Attention: Thomas Daigle, Attorney
        711 Johnston Street
        Lafayette, LA 70501

Bankruptcy Case No.: 08-50215

Chapter 11 Petition Date: February 27, 2008

Court: Western District of Louisiana (Lafayette/Opelousas)

Judge: Robert Summerhays

Debtor's Counsel: William C. Vidrine, Esq.
                     (williamv@vidrinelaw.com)
                  Vidrine & Vidrine
                  711 West Pinhook Road
                  Lafayette, LA 70503
                  Tel: (337) 233-5195
                  Fax: (337) 233-3897
                  http://www.vidrinelaw.com

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

The Debtor did not file a list of its largest unsecured creditors.


DELPHI CORP: Shareholder Settlement Hearing Set for April 29
------------------------------------------------------------
The Hon. Gerald E. Rosen of the U.S. District Court for the
Eastern District of Michigan, Southern Division, will convene a
hearing on April 29, 2008, to decide, among other things, final
Court approval of a settlement providing for a recovery of
$38,250,000 to be paid by Deloitte & Touche LLP, Delphi Corp.'s
outside auditor; and on the dismissal of claims against Deloitte &
Touche.

                  District Court Certifies Class

The Court has preliminarily certified a class consisting of all
persons and entities who purchased or acquired publicly traded
securities issued by Delphi Trust I and Delphi Trust II between
March 7, 2000, and March 3, 2005, inclusive, and who suffered
damages thereby, including all entities who acquired shares of
Delphi common and preferred stock in the secondary market and debt
securities in Delphi.  The case is in In re Delphi Securities,
Derivative and ERISA Litigation, MDL No. 1725, Case No. 05-md-
1725.

The District Court also preliminarily approved the Deloitte &
Touche Settlement providing for a recovery of $38,250,000 to be
paid by Deloitte & Touche LLP, Delphi Corp.'s outside auditor
during the Class Period.  The Class will receive an interest on
the Deloitte & Touche Settlement Amount.

Copies of the full printed Deloitte & Touche Notice and the Proof
of Claim and Release form may be obtained at
http://www.delphiclasssettlement.comor by contacting:

   In re Delphi Corporation Securities Litigation Settlement
   c/o The Garden City Group, Inc.
   Claims Administrator
   P.O. Box 9185
   Dublin, OH 43017-4185

Inquiries may be made to the four co-lead counsel for the Lead
Plaintiffs in the Securities Litigation:

     * Bradley E. Beckworth, Esq.
       Nix, Patterson & Roach, L.L.P.
       205 Linda Drive
       Daingerfield, Texas 75638

     * Sean Handler, Esq.
       Schiffrin Barroway Topaz & Kessler, LLP
       280 King of Prussia Road
       Radnor, PA 19087

     * Jeffrey N. Leibell, Esq.
       Bernsten Litowitz Berger & Grossmann, LLP
       1285 Avenue of the Americas
       New York 10019

     * Stuart Grant, Esq.
       Grant & Eisenhofer P.A.
       Chase Manhattan Centre
       Suite 2100
       1201 N. Market St.
       Wilmington, DE 19801

Further information may also be obtained by writing to the Claims
Administrator or calling 1-800-918-0998 toll-free.

The Securities Litigation has been resolved with respect to the
Debtors pursuant to the Court-approved Multidistrict Litigation  
Settlements between the Debtors and the Lead Plaintiffs.  Under
the terms of the MDL Settlements, the Debtors granted the Lead
Plaintiffs claims that will be satisfied through Delphi's
confirmed Plan of Reorganization.

To participate in the Deloitte & Touche Settlement, parties-in-
interest must have submitted a valid proof of claim in connection
with the MDL Settlements or submit a valid proof of claim to the
Claims Administrator postmarked not later than May 30, 2008.  The
deadline for filing objection and the receipt of requests for
exclusions is April 15, 2008.

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.


DILLARD'S INC: S&P Supersedes Outlook From Stable to Negative
-------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Little
Rock, Arkansas-based Dillard's Inc. to negative from stable.  
      
"The outlook change is based on continued lackluster operating
performance," said Standard & Poor's credit analyst Jackie E.
Oberoi.  The outlook revision reflects a 4% decrease in total
sales and a 5% drop in same-store sales for the year ended Feb. 2,
2008.  While still within the range for the 'BB' rating, credit
metrics have worsened.  "Continued deterioration of credit metrics
could lead to levels below standard for the rating,"she added.


DIRECTV GROUP: Stake Swap Results in Two Board Seats for Liberty
----------------------------------------------------------------
Liberty Media Corporation has completed the exchange of its
16.3% stake in News Corporation for a subsidiary of News that
holds a 41% stake in The DIRECTV Group Inc., regional sports
networks in Denver, Pittsburgh, and Seattle, and $465 million of
cash.

John Malone and Greg Maffei have been appointed to the DIRECTV
board, filling two of the three seats previously held by News
representatives.  Chase Carey will continue to serve as DIRECTV's
president and CEO.

"This transaction is strategically important, financially
attractive, and will provide new focus to Liberty Media," said
Liberty CEO Greg Maffei. "We've been impressed with Chase Carey
and his team and are thrilled to welcome them to the Liberty
family.  We look forward to a partnership with DIRECTV."

The reclassification of Liberty Capital Tracking stock is expected
to be completed in the next three to five business days and the
new Liberty Entertainment and Liberty Capital tracking stocks will
commence trading early next week.

                         About News Corp.

News Corporation is a diversified international media and
entertainment company with operations in eight industry segments:
filmed entertainment; television; cable network programming;
direct broadcast satellite television; magazines and inserts;
newspapers; book publishing; and other. The activities of News
Corporation are conducted principally in the United States,
Continental Europe, the United Kingdom, Australia, Asia and the
Pacific Basin.

                       About Liberty Media

Headquartered in Englewood, Colorado, Liberty Media Corporation
(NasdaqGS: LINTA) -- http://www.libertymedia.com/-- owns
interests in a broad range of electronic retailing, media,
communications and entertainment businesses. Those interests are
attributed to two tracking stock groups: the Liberty Interactive
group, which includes Liberty's interests in QVC, Provide
Commerce, IAC/InterActiveCorp, and Expedia, and the Liberty
Capital group, which includes Liberty's interests in Starz
Entertainment, News Corporation, and Time Warner.

                          *     *     *

Liberty Media Corporation continues to carry Fitch Ratings' 'BB'
long-term issuer default and senior unsecured debt ratings, which
were placed in December 2006.

                       About DirecTV Group

Headquartered in El Segundo, California, The DirecTV Group Inc.
(NASDAQ:DTV) -- http://www.DirecTV.com/-- provides digital   
television entertainment in the United States and Latin America.   
The company's two business segments, DirecTV U.S. and DirecTV
Latin America, are engaged in acquiring, promoting, selling and/or
distributing digital entertainment programming via satellite to
residential and commercial subscribers.  DirecTV Holdings LLC and
its subsidiaries are a provider of direct-to-home digital
television services and a provider in the multi-channel video
programming distribution industry in the United States.  DTVLA is
a provider of DTH digital television services throughout Latin
America.  In January 2007, the company acquired Darlene
Investments LLC's 14.1% equity interest in DirecTV Latin America,
LLC.  DirecTV Latin America LLC is a multinational company, which,
as a result of this transaction, became a wholly owned subsidiary
of the company.

                          *     *     *

In April 2007, Standard and Poor's Ratings Services assigned a
'BB+' Rating on The DirecTV Group Inc.'s long-term foreign and
local issuer credit rating with a stable outlook.  This rating
action still holds to date.


DIRECTV GROUP: FCC Sees Liberty Media Deal to Benefit Public
------------------------------------------------------------
The Federal Communications Commission approved the transfer of
control of DirecTV Group Inc. to Liberty Media Corp., subject to
conditions.  The Commission concluded that, as conditioned, the
public interest benefits of the transfer outweighed the potential
harms and would be consistent with applicable Commission rules and
policies.

As reported in the Troubled Company Reporter on Feb. 11, 2008,
under the deal, News Corp. will exchange its interest in DirecTV
Group Inc. with Liberty Media's interest in News Corp.  Liberty
Media said it plans to exchange its stake in News Corp. for 39% of
DirectTV.  The parties reached an $11 billion deal that includes
News Corp.'s stake in DirectTV.

As a benefit of the transaction, Liberty Media and News Corp.,
which is the majority stakeholder of DirecTV, would sever their
ownership interests with each other which will decrease media
consolidation and reduce vertical integration therefore benefiting
the public.

The Order also imposes certain conditions to ensure that the
transaction will serve Commission's competition and diversity
goals.  The Order requires that Liberty and DirecTV abide by
program access, program carriage, Regional Sports Network  
arbitration, retransmission consent arbitration conditions,
modeled on similar conditions imposed in 2003, when the Commission
approved the transfer of DIRECTV from Hughes to News Corp.

In addition, the Order requires that all of the attributable
ownership interests connecting DirecTV-Puerto Rico and Liberty
Cablevision of Puerto Rico, Ltd., which will be under common
control as a result of the transaction, be severed within one
year, at which point the companies must certify either that they
have reduced the relevant interests to a non-attributable level or
that they have filed any applications necessary to divest assets.

On balance, the Commission found that the transaction, as
conditioned, would serve the public interest.

                         About News Corp.

News Corporation is a diversified international media and
entertainment company with operations in eight industry segments:
filmed entertainment; television; cable network programming;
direct broadcast satellite television; magazines and inserts;
newspapers; book publishing; and other.  The activities of News
Corporation are conducted principally in the United States,
Continental Europe, the United Kingdom, Australia, Asia and the
Pacific Basin.

                       About Liberty Media

Headquartered in Englewood, Colorado, Liberty Media Corporation
(NasdaqGS: LINTA) -- http://www.libertymedia.com/-- owns
interests in a broad range of electronic retailing, media,
communications and entertainment businesses.  Those interests are
attributed to two tracking stock groups: the Liberty Interactive
group, which includes Liberty's interests in QVC, Provide
Commerce, IAC/InterActiveCorp, and Expedia, and the Liberty
Capital group, which includes Liberty's interests in Starz
Entertainment, News Corporation, and Time Warner.

                           About DirecTV

Headquartered in El Segundo, California, The DIRECTV Group Inc.
(NYSE: DTV) -- http://www.directv.com/ -- provides digital     
television entertainment services.  Through its subsidiaries
and affiliated companies in the United States, Brazil, Mexico and
other countries in Latin America, the DIRECTV Group provides
digital television service to more than 16.5 million customers in
the United States and over 4.6 million customers in Latin America.

                          *     *     *

In April 2007, Standard & Poor's Ratings Services affirmed the
'BB' corporate credit and 'BB-' senior unsecured debt rating on
The DIRECTV Group Inc.  S&P said the outlook is stable.

In addition, Standard & Poor's raised the bank loan rating on
$2 billion of credit facilities at DIRECTV Holdings LLC, a wholly
owned subsidiary of The DIRECTV Group Inc, to 'BB+' from 'BB' and
revised the recovery rating to '1' from '3'.


EQUIFIRST MORTGAGE: Class B-2 Cert. Gets S&P's Junk Rating From BB
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class B-1 and B-2 asset-backed certificates from Equifirst
Mortgage Loan Trust 2004-3.  Concurrently, S&P affirmed its
ratings on the remaining 10 classes from this transaction.
     
The downgrades reflect collateral performance that has eroded
available credit support during recent months.  As of the January
2008 remittance period, cumulative losses were $9.6 million, or
2.04% of the original principal balance.  Serious delinquencies
(90-plus days, foreclosures, and REOs) were $28.25 million, about
4.5x greater than the $6.227 million in current
overcollateralization (O/C), which is $3.153 million below its
target of $9.38 million.  Losses have consistently outpaced excess
interest for nine of the 12 most recent months.
     
Current and projected credit support percentages are sufficient to
support the classes with affirmed ratings.
     
Subordination, O/C, and excess spread provide credit support for
this series.  The loan pool consists of conventional, one- to
four-family, adjustable- and fixed-rate mortgage loans secured by
first liens on residential properties.

                          Ratings Lowered

              Equifirst Mortgage Loan Trust 2004-3
             Asset-backed certificates series 2004-3

                                  Rating
                                  ------
                       Class   To       From
                       -----   --       ----
                       B-1     BB-      BB+
                       B-2     CCC      BB

                         Ratings Affirmed

              Equifirst Mortgage Loan Trust 2004-3
             Asset-backed certificates series 2004-3

                          Class   Rating
                          -----   ------
                          M-1     AA+
                          M-2     AA
                          M-3     AA-
                          M-4     A+
                          M-5     A
                          M-6     A-
                          M-7     BBB+
                          M-8     BBB
                          M-9     BBB-
                          M-10    BBB-


FAIRPOINT COMMS: S&P Lifts Rating to 'BB' on Merger With Verizon
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Charlotte North Carolina-based local exchange carrier,
FairPoint Communications Inc. to 'BB' from 'BB-' and removed the
ratings from CreditWatch.  The outlook is stable.
     
At the same time, S&P assigned ratings to the new bank loan and
notes that will used to finance FairPoint's pending merger with an
entity spun off from Verizon Communications Inc.  The upgrade
reflects expected operating and financial improvements following
the completion of FairPoint's merger with the company formed
through the spinoff of certain of Verizon's New England wireline
assets.
     
FairPoint's ratings were placed on CreditWatch with positive
implications on Jan. 17, 2007, following the announcement of the
merger agreement with the Verizon Spinco recognizing the benefits
of greater scale and a potentially less aggressive financial
policy.
     
S&P assigned a 'BB+' issue rating and '2' recovery rating to
FairPoint's proposed $2.080 billion senior secured credit
facility.  The '2' recovery rating indicates expectations of
substantial (70%-90%) recovery in the event of a payment default.
     
S&P also assigned a 'B+' rating to FairPoint's proposed
$540 million of senior unsecured notes.  The notes are rated two
notches below the corporate credit rating because priority debt,
consisting primarily of secured bank loans, will exceed 30% of
total assets.  The ratings on the outstanding $688.5 million
FairPoint credit facility were not raised and will be withdrawn
because this facility will be repaid concurrent with the
completion of the spinoff and merger.  Debt outstanding at closing
is expected to total about $2.1 billion.
     
The rating upgrade on FairPoint reflects the increased size and
scale of the new company, which is expected to result in improved
operating efficiencies; moderate cable modem overlap of 60%-70%,
which provides some medium-term protection against cable
competition for voice and data services; and prospects for revenue
growth by expanding DSL service in the former Verizon territories.
     
Tempering factors include significant integration risk given that
post-merger the company will be almost six times larger than the
legacy FairPoint operations.  Additionally, FairPoint is expected
to incur material transition related expenses during the first
year of combined operations, and geographic diversity is limited
with over 88% of the combined company's access lines located in
Maine, Vermont and New Hampshire.
      
"FairPoint's financial policy will be somewhat more moderate than
prior to the merger," said Standard & Poor's credit analyst Susan
Madison.  "Nevertheless, it is still considered aggressive and
remains a limiting rating factor."
     
Pro forma for the transaction, FairPoint will be an incumbent
local exchange carrier providing voice and data communications
services to approximately two million total access line
equivalents.  By leveraging its increased size and scale,
FairPoint expects to realize significant cost savings beginning in
2009, which should help to offset the revenue impact of a
declining access line base.


FAIRPOINT COMMS: Proposed Merger Approval Cues Moody's 'B1' Rating
------------------------------------------------------------------
Moody's Investors Service assigned a B1 corporate family rating
and a positive outlook to FairPoint Communications, Inc.,
following the announcement that all three states have approved the
proposed merger with Verizon Communications' Maine, New Hampshire
and Vermont wireline operations in a reverse Morris Trust
transaction, valued at $2.4 billion in cash and stock (net of
$235 million of working capital contribution by Verizon).  In
connection with the merger, FairPoint will issue $2.08 billion of
senior secured debt, to which Moody's has assigned a Ba3 rating
(LGD3-42%) and will assume $540 million in senior unsecured notes
issued by Verizon, to be rated B3 (LGD6-91%).  The existing debt
at FairPoint will be repaid at closing of the transaction, and the
ratings will be withdrawn.  As part of the ratings action, Moody's
assigned an SGL-2 liquidity rating to FairPoint.

These summarizes the rating actions taken by Moody's:

  -- Corporate Family Rating: Assigned B1
  -- Probability of Default Rating: Assigned B1
  -- Speculative Grade Liquidity Rating: Assigned SGL-2
  -- Senior Secured Bank Facilities: Assigned Ba3 (LGD3: 42%)
  -- Senior Unsecured Notes: Assigned B3 (LGD6: 91%)
  -- Rating Outlook: Positive

Although Moody's notes that FairPoint's fundamental credit profile
exhibits stronger features than the assigned B1 corporate family
rating, it also reflects the continued downward pressure on
wireline revenue and cash flow growth in the future and the
substantial integration risk of assuming the much larger VZ-NE
operation, specifically the near term uncertainty that the systems
upgrade, transition and integration will go smoothly.  Moody's
Vice President and Senior Analyst, Gerald Granovsky says further
that, "Until the switchover of systems from Verizon to FairPoint
is done, this risk will not go away, although the ratings agency
would be able to assess the results within a relatively short time
following the completion of the acquisition."  For this reason,
and the expected continued improvement in the company's credit
profile, aided by the 35% reduction in the dividend payout, the
ratings agency assigned a positive outlook.

FairPoint's overall adjusted leverage (Debt/EBITDA) is expected to
decrease to about 3.8x at closing, pro forma for the acquisition,
from 5.1x for LTM 3Q 2007.  However, the rating agency believes
that the integration costs and the mandated additional capital
needed to upgrade the acquired lines for higher speed internet
access will stress the financial metrics over the intermediate
term, resulting in an increase in leverage to 5.5x at year-end
2008, before reducing to about 4.2x at year-end 2009.  Moody's
expects FairPoint's steady-state free cash flow available for debt
reduction to remain in the 4% 5% range over the next two years.

FairPoint's SGL-2 short-term liquidity rating reflects the
company's good liquidity in the twelve months after closing VZ-NE
acquisition.  FairPoint's liquidity primarily consists of modest
amounts of cash-on-hand and the $200 million revolving credit
facility, which is expected to remain undrawn in the twelve months
after closing VZ-NE acquisition.  FairPoint plans to fund nearly
$140 million of anticipated cash burn, due to about $340 million
of extraordinary capital expenditures and integration-related
costs in the first year of operation, by borrowing up to
$200 million under a committed delayed draw term loan facility.

The Baa1 senior unsecured non-guaranteed debt ratings of Verizon-
New England remain on review, direction uncertain, pending the
further review of Verizon-New England's prospective capital
structure.

Pro-forma for the transaction, FairPoint, headquartered in
Charlotte, North Carolina, will become the eight largest wireline
telecommunications company in the US, serving about 1.6 million
access lines in primarily rural areas and small- and medium-sized
cities.  Verizon Communications is headquartered in Basking Ridge,
New Jersey.


FIDELITY NATIONAL: Earns $108 Mil. in Quarter ended December 31
---------------------------------------------------------------
Fidelity National Information Services Inc. disclosed financial
results for the quarter and year ended Dec. 31, 2007.  

Fourth quarter 2007 net earnings totaled $108.4 million compared
to net earnings of $75.12 million for the same period in the
previous year.  FIS' fourth quarter 2007 results include
approximately $140 million in revenue from eFunds.  Excluding
eFunds, the company reported fourth quarter revenue growth of
7.4%.

For the full year 2007, net earnings totaled $561.2 million
compared to net earnings of $259.09 million in 2006.  These
results include revenue of approximately $167 million  
attributable to eFunds, which was acquired by FIS in September
2007.  Excluding eFunds, full year revenue increased 11.0% to
$4.6 billion, compared to pro forma revenue of $4.1 billion in
2006.  The increase was driven by 10.5% growth in Transaction
Processing Services and 11.2% growth in Lender Processing
Services.

"It was a good quarter and great year for FIS," William P. Foley,
II, executive chairman of FIS, stated.  "Double digit revenue
growth in Transaction Processing Services and Lender Processing
Services enabled us to achieve excellent financial performance in
2007, despite a highly challenging economic environment.  We
expect to make significant progress with the eFunds integration,
and are on track to complete the spin-off of our Lender Processing
business by mid 2008."

                    About Fidelity National

Based in Jacksonville, Florida, Fidelity National Information
Services, Inc. -- http://www.fidelityinfoservices.com/--    
provides core processing for financial institutions; card issuer
and transaction processing services; mortgage loan processing and
mortgage related information products; and outsourcing services to
financial institutions, retailers, mortgage lenders and real
estate professionals.  FIS has processing and technology
relationships with 35 of the top 50 global banks, including nine
of the top ten.  Nearly 50% of all US residential mortgages are
processed using FIS software.  FIS maintains a strong global
presence, serving over 7,800 financial institutions in more than
60 countries worldwide, including Brazil and Japan.

                       *     *     *

As reported in the Troubled Company Reporter on Oct. 30, 2007,
following Fidelity National Information Systems Inc.'s
announcement of a plan to split the company into two segments,
Fitch Ratings will reevaluate Fidelity's Issuer Default Rating and
debt ratings once further clarity is available on the final
capital structure and operating profile of each entity.

Fitch currently rates Fidelity as: IDR 'BB'; $900 million secured
revolving credit facility 'BB+'; $2.1 billion secured term loan A
'BB+'; $1.6 billion secured term loan B 'BB+'; and  4.75% senior
notes 'BB+'.  The Rating Outlook is Stable.


FINLAY ENTERPRISES: Deal with NRDC Ends Over Fortunoff Sale
-----------------------------------------------------------
Finlay Enterprises Inc. received notification from Lord & Taylor
that the company's license agreements will not be renewed upon the
expiration of the agreements on Jan. 31, 2009.  The company will
close a total of 47 Lord & Taylor locations at the end of fiscal
2008.

This development follows the acquisition of Fortunoff Fine Jewelry
and Silverware LLC out of bankruptcy by an affiliate of NRDC
Equity Partners LLC, which owns the Lord & Taylor department store
chain.  Lord & Taylor has indicated its intent to operate its own
jewelry departments through Fortunoff.

In fiscal 2007, the Lord & Taylor locations generated
approximately $44 million in revenue for Finlay. Finlay is
currently evaluating the impact of the expected closings on its
financial results for fiscal 2008 and beyond.

Arthur E. Reiner, chairman and chief executive officer of Finlay
Enterprises commented, "Given the recent evolving department store
landscape, we have focused on the diversification of our business
over the last three years by entering into the luxury free-
standing specialty jewelry sector.  We will continue to focus on
further penetrating this sector, while also maximizing the return
of our existing lease business."

                        About Fortunoff

New York-based Fortunoff Fine Jewelry and Silverware LLC --
http://www.fortunoff.com/-- is a family owned business since    
1922 founded by by Max and Clara Fortunoff.  Fortunoff offers
customers fine jewelry and watches, antique jewelry and silver,
everything for the table, fine gifts, home furnishings including
bedroom and bath, fireplace furnishings, housewares, and seasonal
shops including outdoor furniture shop in summer and enchanting
Christmas Store in the winter.  It opened some 20 satellite
stores in the New Jersey, Long Island, Connecticut and
Pennsylvania markets featuring outdoor furniture and grills
during the Spring/Summer season and indoor furniture (and in some
locations Christmas trees and decor) in the Fall/Winter season.

Fortunoff and two affiliates, M. Fortunoff of Westbury LLC and
Source Financing Corp., filed for chapter 11 petition on Feb. 4,
2008 (Bankr. S.D.N.Y. Case Nos. 08-10353 through 08-10355) in
order to effectuate a sale to NRDC Equity Partners LLC, --
http://www.nrdcequity.com/-- a private equity firm that owns       
of Lord & Taylor from Federated Department Stores.  

Due to the U.S. Trustee's objection, Fortunoff is backing out of
its request to employ Skadden Arps Meagher & Flom LLC, as
bankruptcy counsel.  Fortunoff is hiring Togut Segal & Segal LLP,
as their general bankruptcy counsel, but Skadden Arps will
continue to serve the Debtors as special counsel in connection
with the sale the Debtors' assets.  Logan & Company, Inc., serves
as the Debtors' claims, noticing, and balloting agent.  FTI
Consulting Inc. are the Debtors' proposed crisis manager.

An Official Committee of Unsecured Creditors has been appointed in
this case.

When the Debtors filed for bankruptcy, they listed assets and
debts between $100 million to $500 million.  The Debtors'
exclusive period to file a plan of reorganization ends on June 3,
2008.  (Fortunoff Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000)

                     About Finlay Enterprises

Headquartered in New York City, Finlay Enterprises Inc. (Nasdaq:
FNLY) -- http://www.finlayenterprises.com/-- through its wholly-
owned subsidiary, Finlay Fine Jewelry Corporation, retails fine
jewelry and operates luxury stand-alone specialty jewelry stores
primarily located in the southeastern United States and
licensed fine jewelry departments in department stores throughout
the United States.  The number of locations at the end of fiscal
2007 totaled 794, including 69 Bailey Banks & Biddle, 32 Carlyle
and five Congress specialty jewelry stores.

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 13, 2008,
Standard & Poor's Ratings Services said that the closure of 94
stores due to the consolidation of Macy's divisions will have no
immediate impact on Finlay Enterprises' (Finlay; B-/Negative/--)
rating or outlook.  Pro forma the closure, S&P estimates the
EBITDA loss to be approximately $4 million and that interest
coverage will be less than 1x.  Finlay entered into a new
$500 million revolving credit facility in November 2007 with the
only financial covenant that the company maintains a minimum
availability of $30 million.


FIRST NLC: Adverse Pool Performance Spurs S&P's Rating Downgrades
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on eight
classes of mortgage-backed certificates and callable mortgage-
backed notes from First NLC Trust's series 2005-1 and 2005-2.
     
The downgrades reflect continuous adverse pool performance, which
has eroded available credit support during recent months and as of
the January 2008 remittance period.  For series 2005-1, cumulative
losses were $12.13 million and serious delinquencies (90-plus
days, foreclosures, and REOs) were $75.61 million as of the
January 2008 remittance period.  For series 2005-2, cumulative
losses were $8.51 million and serious delinquencies were
$69.56 million.
     
For both loan groups, losses have outpaced excess interest for the
most recent 12 months, and current overcollateralization (O/C)
levels are below their targets.
     
O/C, excess spread, and subordination provide credit support for
these deals.  Both mortgage pools consist of 30-year,
conventional, fixed- and adjustable-rate subprime mortgage loans
secured by first liens on one- to four-family residential
properties and single-unit condominiums.

                         Ratings Lowered

                         First NLC Trust

                                     Rating
                                     ------
                  Series   Class   To     From
                  ------   -----   --     ----
                  2005-1   M13     BB     BBB+    
                  2005-1   M14     BB-    BBB+
                  2005-1   M15     B      BBB-
                  2005-2   M7      A-     A
                  2005-2   M8      BBB-   A-
                  2005-2   M9      BB     BBB+
                  2005-2   M10     B      BBB
                  2005-2   M11     CCC    BBB-


FORTUNOFF: Asset Sale Causes Termination of Finlay-NRDC Agreement
-----------------------------------------------------------------
Finlay Enterprises Inc. received notification from Lord & Taylor
that the company's license agreements will not be renewed upon the
expiration of the agreements on Jan. 31, 2009.  The company will
close a total of 47 Lord & Taylor locations at the end of fiscal
2008.

This development follows the acquisition of Fortunoff Fine Jewelry
and Silverware LLC out of bankruptcy by an affiliate of NRDC
Equity Partners LLC, which owns the Lord & Taylor department store
chain.  Lord & Taylor has indicated its intent to operate its own
jewelry departments through Fortunoff.

In fiscal 2007, the Lord & Taylor locations generated
approximately $44 million in revenue for Finlay. Finlay is
currently evaluating the impact of the expected closings on its
financial results for fiscal 2008 and beyond.

Arthur E. Reiner, chairman and chief executive officer of Finlay
Enterprises commented, "Given the recent evolving department store
landscape, we have focused on the diversification of our business
over the last three years by entering into the luxury free-
standing specialty jewelry sector.  We will continue to focus on
further penetrating this sector, while also maximizing the return
of our existing lease business."

                     About Finlay Enterprises

Headquartered in New York City, Finlay Enterprises Inc. (Nasdaq:
FNLY) -- http://www.finlayenterprises.com/-- through its wholly-
owned subsidiary, Finlay Fine Jewelry Corporation, retails fine
jewelry and operates luxury stand-alone specialty jewelry stores
primarily located in the southeastern United States and
licensed fine jewelry departments in department stores throughout
the United States.  The number of locations at the end of fiscal
2007 totaled 794, including 69 Bailey Banks & Biddle, 32 Carlyle
and five Congress specialty jewelry stores.

                        About Fortunoff

New York-based Fortunoff Fine Jewelry and Silverware LLC --
http://www.fortunoff.com/-- is a family owned business since    
1922 founded by by Max and Clara Fortunoff.  Fortunoff offers
customers fine jewelry and watches, antique jewelry and silver,
everything for the table, fine gifts, home furnishings including
bedroom and bath, fireplace furnishings, housewares, and seasonal
shops including outdoor furniture shop in summer and enchanting
Christmas Store in the winter.  It opened some 20 satellite
stores in the New Jersey, Long Island, Connecticut and
Pennsylvania markets featuring outdoor furniture and grills
during the Spring/Summer season and indoor furniture (and in some
locations Christmas trees and decor) in the Fall/Winter season.

Fortunoff and two affiliates, M. Fortunoff of Westbury LLC and
Source Financing Corp., filed for chapter 11 petition on Feb. 4,
2008 (Bankr. S.D.N.Y. Case Nos. 08-10353 through 08-10355) in
order to effectuate a sale to NRDC Equity Partners LLC, --
http://www.nrdcequity.com/-- a private equity firm that owns       
of Lord & Taylor from Federated Department Stores.  

Due to the U.S. Trustee's objection, Fortunoff is backing out of
its request to employ Skadden Arps Meagher & Flom LLC, as
bankruptcy counsel.  Fortunoff is hiring Togut Segal & Segal LLP,
as their general bankruptcy counsel, but Skadden Arps will
continue to serve the Debtors as special counsel in connection
with the sale the Debtors' assets.  Logan & Company, Inc., serves
as the Debtors' claims, noticing, and balloting agent.  FTI
Consulting Inc. are the Debtors' proposed crisis manager.

An Official Committee of Unsecured Creditors has been appointed in
this case.

When the Debtors filed for bankruptcy, they listed assets and
debts between $100 million to $500 million.  The Debtors'
exclusive period to file a plan of reorganization ends on June 3,
2008.  (Fortunoff Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000)


FORTUNOFF: Highest Bid Awarded to NRDC Equity's H Acquisition
-------------------------------------------------------------
The bid put forth by NRDC Equity Partners LLC, through affiliate  
H Acquisition, emerged as the "highest and best bid" available to
the estate of Fortunoff Fine Jewelry and Silverware LLC and its
debtor-affiliates.

Todd M. Goren, Esq., at Otterbourg, Steindler, Houston & Rosen,
P.C., in New York, on behalf of the Official Committee of
Unsecured Creditors said that after a full and fair -- albeit
abbreviated -- process, the only party willing to submit a going
concern bid for the Debtors' assets was H Acquisition.

H Acquisition in its asset purchase agreement with the Debtors
offered to purchase Fortunoff for $80,000,000, but the offer was
still subject to competing bids at an auction scheduled for
Feb. 26, 2008.

"While the Committee wishes the circumstances were such that more
parties had been interested in purchasing the Debtors' business,
which would have resulted in a more competitive auction, this was
unfortunately, the hand we were dealt," Mr. Goran said.

"As a result, the bid put forth by the H Acquisition, which was
improved in numerous respects over the course of the auction, is
the highest and best bid available to the estate."

The Committee, in its letter of support on the sale, said it has
been an active participant in the sale process.

                    Committee to Support Sale
                Despite No Recovery to Constituents

The Committee said in light of the circumstances, it supports the
sale of the Debtors' assets to H Acquisition despite the fact
that the sale will unlikely provide any distribution to unsecured
creditors.

The Committee noted that the sale will allow the Debtors to
continue as a going concern entity.  "The benefits associated
with the a sale far outweigh what could have been achieved in a
liquidation -- thousands of employees will retain their jobs,
many lease and contract counterparties will have their agreements
assumed and be paid on account of any existing defaults, holders
of gift certificates and merchandise credits will be allowed to
continue to use the credits in the ordinary course, and
importantly the Debtors' vendors will continue to have a customer
with which to do business going forward."

Noting of the "numerous benefits associated with closing the
sale", the Committee added that the sale must be allowed to
close, notwithstanding the objections filed by a number of
parties, including vendors who shipped goods on "memorandum".

                 Landlords Object to Cure Amounts

As previously reported, part of the Debtors' proposed bidding
procedures for the sale of substantially all of their assets,
contemplates (i) their assumption and assignment of certain
contracts to H Acquisition, LLC -- or the successful bidder at the
auction, and (ii) the execution and delivery to H Acquisition --
or the successful bidder, as the case may be -- of the documents
or other instruments as may be necessary to assign and transfer
the Assumed Contracts to the buyer.

A number of landlords object to the Debtors' proposed cure
amounts in connection with the Assumed Contracts, and submitted
to the Court their individual computations of what they assert
are the appropriate Cure Amounts.  These are:

                                         Cure Amount
   Landlord                               Asserted
   --------                              -----------
   Bloomingdale Road Investors LLC        $1,288,335
   El-Kam Realty Co.                         630,906
   Century Road Plaza, LLC                   195,827
   Wayne Towne Center Associates, L.L.C      195,055
   Maclara LLC                                90,039
   RTC Properties, Inc.                       82,787
   Centro NP, LLC                             65,113
   Simon Property Group, Inc.                 56,282
   UB Danbury, Inc.                           20,282  
   Valley Forge Center Associates             14,384

Developers Diversified Realty Corp., as managing agent for Inland
Southeast Brick LLC, wants cure payment of $24,341 for the
assumption of a lease at Brick Center Plaza Shopping Center, in
Brick, New Jersey.

General Growth Properties, Inc., asserts a $65,233 cure payment
for the assumption of a mall lease at Paramus Park Shopping
Center, in Paramus Park, New Jersey, and $3,500 for a lease at
Woodbridge Center, in Woodbridge, New Jersey.

UB Danbury also objects to the assumption and assignment of a
lease agreement with the Debtors on grounds that it was not
provided sufficient information that would allow it to assess
whether assumption and assignment of the lease is proper under
the Bankruptcy Code.

Simon Property Group asserts that any assignee must specifically
agree to take its leases subject to all charges accrued, but not
yet billed under the leases, including, common area maintenance,
real estate taxes, overage rent, percent rent and utilities.

Wayne Town Center, RTC Properties and Valley Forge Center seek
from the Debtors, adequate assurance of future performance from
any proposed assignee of a real property lease.

Section 365(f) of the Bankruptcy Code provides that the Debtors
may assign an unexpired lease only if adequate assurance of
future performance by the assignee of the lease is provided,
whether or not there has been a default in lease.

         More Diamond Suppliers Want Share from Proceeds

A. Martin Flyer

Martin Flyer, Inc., seeks clarification that the diamonds,
gemstones and other merchandise it consigned to Fortunoff Fine
Jewelry and Silverware LLC, are outside the scope of the sale
of substantially all assets of the Debtors for $80,000,000.

Martin Flyer filed on Dec. 14, 2004, a Uniform Commercial
Code-1 statement to secure its interest in merchandise it
delivered to the Debtors.  Martin Flyer asserts that its security
interest is a valid and perfected security interest that should
not be subject to the liens granted to the Debtors' DIP Lenders.

Should Martin Flyer's merchandise be included in the sale, any
proceeds from the sale should be attributed to the payment of
Martin Flyer's security interests, in advance of any DIP Liens,
asserts Edward J. Estrada, Esq., at Reed Smith, LLP, in New York.

Mr. Estrada contends the merchandise delivered by Martin Flyer
are not property of the Debtors' estates and cannot be sold free
and clear of liens, regardless if the sale occurs in the ordinary
course under Section 363(f).

Mr. Estrada adds that even if the Court were to determine that
the Martin Flyer merchandise were property of the Debtors'
estate, each memorandum agreement -- the document signed by
Fortunoff acknowledging the receipt goods on the term specified
-- is an executory contract, hence, the Debtors cannot sell the
subject merchandise without performing according to the terms of
each memorandum and curing all contractual defaults.

B. Lazare Kaplan

Lazare Kaplan International Inc. joins in the request of
Verstandig & Sons, Inc., and other jewelry suppliers (i) to
exclude goods they delivered to the Debtors from the bulk sale of
the Debtors' assets, or (ii) for payment of their merchandise
from the proceeds of the sale.

LKI, a jewelry and diamond wholesaler, supplied goods to the
Debtors and non-debtor Fortunoff Fine Jewelry and Silverware Inc.
Certain of the goods delivered prior to the bankruptcy filing were
delivered "on memo" pursuant to the specific terms and conditions
set forth in the memorandum agreement which accompanied each and
every delivery of goods delivered to the Debtors.

Diamond suppliers have argued that pursuant to the memorandums,
the Debtors the title of the goods received by the Debtors remain
with the suppliers, and the Debtors have no right to sell the
goods absent the respective supplier's consent.

LKI asserts claims aggregating $793,698 for goods delivered
before the bankruptcy filing.  However, it notes that the
aggregate value of the Memo Goods as of the bankruptcy filing is
unknown to it because it is unaware of the value of the goods sold
by Fortunoff Inc. or the Debtors prior to the bankruptcy filing.

C. DDI and DSD

Jewelry wholesalers D'Annunzio Distribution, Inc., and D'
Annunzio Showcase Dealers, Inc., also delivered goods "on memo"
to the Debtors.  D'Annunzio filed U.C.C.-1 financing statements
evidencing the delivery of the Memo Goods.  DDI's total claim for
the Memo Goods is $369,855, and DSD's is $142,690.

D'Annunzio asks the Court to prohibit or condition the sale of
the Memo Goods to protect its interests.

               Debtors Say Sale Should Move Forward

The Debtors inform the Court that the buyer of their assets are
currently in discussions with the landlords who have filed
objections to the proposed sale, which includes the assumption by
Fortunoff, and the assignment to the buyer, of certain executory
contracts and leases.

In light of Simon Property Group's objections, the Debtors are no
longer assuming the Simon Group leases.  Simon had contended,
among others, that all bidders should be required to operate
under the use restrictions of the leases.

Sally McDonald Henry, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, refutes allegations by diamond and jewelry suppliers
that the Debtors are barred from selling the goods they delivered
to Fortunoff:

    -- The Memo Goods sellers have only an unperfected
       consignment.  The Memo Vendors that failed to file U.C.C.
       financing statements are merely unsecured creditors.  Two
       vendors who claimed to have filed U.C.C. statements have
       filed invalid statements -- (i) D'Annunzio's U.C.C. filing
       was filed in the wrong state, New York, against the wrong
       entity (Fortunoff); it should have been filed in Delaware
       against Fortunofff Fine Jewelry and Silverware, LLC; and
       (ii) Martin Flyer's U.C.C. should have been filed in
       Delaware against Fortunoff Fine Jewelry and Silverware,
       LLC, instead of Fortunoff Fine Jewelry Inc.

    -- There is no constructive trust because (i) there has been
       no unjust enrichment; (ii) there is no fiduciary
       relationship; and (iii) no equitable remedy is necessary
       when a legal remedy exists, i.e., a claim in bankruptcy.  
       The Memo Vendors' relationship with the Debtors is an
       arm's-length commercial relationship that does not give
       rise to fiduciary obligations.

    -- The Memorandums are not executory contracts because the
       Debtors have no material obligatings remaining; their only
       only obligation is to pay money; and

    -- The Debtors did not hold the Memo Goods under a common law
       bailment.  The Memo Goods were not delivered to the
       Debtors with the expectation that they would be
       redelivered to the Memo Vendors or "kept until[ ]
       reclaim[ed]" by them.

Because the Memo Vendors are unsecured creditors, on account of
the unperfected U.C.C. filings, they are not entitled to adequate
protection under Section 363(e) of the Bankruptcy Code, Ms. Henry
adds.  Section 363(e) only protects secured creditors against the
diminution in value of their collateral.

The Debtors also contest certain of the Memo Vendors' claims that
the Memo Goods are not property of the estate on account of the
Memorandums.  Ms. Henry notes that, under the U.C.C., the Memo
Vendors' attempts to retain title are simply not relevant to the
Debtors' ability to sell the Memo Goods in the proposed sale.  
She cites Valley Media, 279 B.R. at 121, which held that
documentatiaon stating that diamonds remain property of
transferor has "no bearing" in construing transaction.

The Debtors reject Georgianna Koulianos Designs, Inc.'s arguments
that its goods should not be included in the proposed sale.  The
Debtors say Georgianna has no reclamation rights because its
interessts are subjec to the Term D Lenders' pre-existing
undersecured lien on inventory.
  
          Committee Wants Memo Vendors Rights Preserved

The Committee submitted a statement airing its support to the
sale of the Debtors' assets to H Acquisition.

The Committee, however, said it is cognizant of the fact that
many of the Debtors' vendors who shipped goods on "memorandum-
dispute the Debtors' ability to transfer the goods to H
Acqusition.

The Committee asserts that unless the Court can adequately
determine the rights of Memo Goods vendors at the hearing to
approve the sale, the rights of the vendors should be preserved
for a future hearing, at which time the Court can adjudicate
whether the vendors have senior interests in the Memo Goods.

                        About Fortunoff

New York-based Fortunoff Fine Jewelry and Silverware LLC --
http://www.fortunoff.com/-- is a family owned business since    
1922 founded by by Max and Clara Fortunoff.  Fortunoff offers
customers fine jewelry and watches, antique jewelry and silver,
everything for the table, fine gifts, home furnishings including
bedroom and bath, fireplace furnishings, housewares, and seasonal
shops including outdoor furniture shop in summer and enchanting
Christmas Store in the winter.  It opened some 20 satellite
stores in the New Jersey, Long Island, Connecticut and
Pennsylvania markets featuring outdoor furniture and grills
during the Spring/Summer season and indoor furniture (and in some
locations Christmas trees and decor) in the Fall/Winter season.

Fortunoff and two affiliates, M. Fortunoff of Westbury LLC and
Source Financing Corp., filed for chapter 11 petition on Feb. 4,
2008 (Bankr. S.D.N.Y. Case Nos. 08-10353 through 08-10355) in
order to effectuate a sale to NRDC Equity Partners LLC, --
http://www.nrdcequity.com/-- a private equity firm that owns       
of Lord & Taylor from Federated Department Stores.  

Due to the U.S. Trustee's objection, Fortunoff is backing out of
its request to employ Skadden Arps Meagher & Flom LLC, as
bankruptcy counsel.  Fortunoff is hiring Togut Segal & Segal LLP,
as their general bankruptcy counsel, but Skadden Arps will
continue to serve the Debtors as special counsel in connection
with the sale the Debtors' assets.  Logan & Company, Inc., serves
as the Debtors' claims, noticing, and balloting agent.  FTI
Consulting Inc. are the Debtors' proposed crisis manager.

An Official Committee of Unsecured Creditors has been appointed in
this case.

When the Debtors filed for bankruptcy, they listed assets and
debts between $100 million to $500 million.  The Debtors'
exclusive period to file a plan of reorganization ends on June 3,
2008.  (Fortunoff Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000)


FREESTAR TECH: Posts $4,568,270 Net Loss in 2nd Qtr. Ended Dec. 31
------------------------------------------------------------------
FreeStar Technology Corp. recorded a net loss of $4,568,270 for
the second quarter ended Dec. 31, 2007, compared to a net loss of
$3,124,456 for the three months ended Dec. 31, 2006, an increase
of $1,443,814 or approximately 46%.  

Ciaran Egan, FreeStar's chief financial officer, commented that
"approximately $2,300,000 of this amount consisted of non-cash
compensation in the form of stock, stock options, and warrants
issued to consultants and employees.  We continue to launch new
innovative products and expand our geographical market for
increased growth opportunities in 2008.  We believe that our
investment program in our product and sales and marketing programs
together with our growing pipelines will drive revenue growth in
2008."

Revenue for the three months ended Dec. 31, 2007, was $1,448,713
compared to $811,902 for the three months ended Dec. 31, 2006, an
increase of $636,811 or approximately 78%.  Revenue consisted of
transaction processing and related revenue of $512,782; consulting
services revenue of $683,862 and hardware and related revenue of
$252,069.

FreeStar Technology president and chief executive officer Paul
Egan said, "We expect to see continued increased hardware related
sales to our expanding customer base, but also recognize
increasing revenue streams from annual maintenance fees and
service initiation fees.  

"Our cross border payments processing has now expanded to Spain,
Iceland, Denmark, Sweden and the U.K.  We are seeing a steady
increase in DCC (Dynamic Currency Conversion) Transactions from
our partner, Global Refunds.  We have successfully deployed
terminals in Dominican Republic and see continuing growth in the
region.  Our International projects are nearing deployment and can
expect to see a large increase in processing revenues throughout
the remainder of fiscal 2008."

                          Balance Sheet

At Dec. 31, 2007, the company's consolidated balance sheet showed
$8,201,305 in total assets, $3,509,597 in total liabilities,
$407,398 in minority interest, and $4,284,310 in total
stockholders' equity.

The company's consolidated balance sheet at Dec. 31, 2007, also
showed strained liquidity with $1,945,907 in total current assets
available to pay $3,509,597 in total current liabilities.

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?288f

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on Oct. 4, 2007,
New York-based RBSM LLP expressed substantial doubt about FreeStar
Technology Corp.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
June 30, 2007.  The auditing frim said the company is experiencing
difficulty in generating sufficient cash flow to meet its
obligations and sustain its operations.

                    About FreeStar Technology

Based in Dublin, Ireland, FreeStar Technology Corp. (OTC BB: FSRT)
-- http://www.freestartech.com/-- provides electronic payment  
processing services, including credit and debit card transaction
processing, point-of-sale related software applications and other
value-added services.  The company was incorporated in the State
of Nevada.  The company also has offices in Helsinki, Finland;
Stockholm, Sweden; Geneva, Switzerland; and Santo Domingo, the
Dominican Republic.


GARTECH ELECTRICAL: Case Summary & 59 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Gartech Electrical Contracting
        100 Hinsdale Street
        Brooklyn, NY 11207

Bankruptcy Case No.: 08-41082

Type of Business: The Debtor is an industrial electrician
                  specializing in public projects like
                  as subway tunnel lighting.

Chapter 11 Petition Date: February 26, 2008

Court: Eastern District of New York (Brooklyn)

Judge: Elizabeth S. Stong

Debtor's Counsel: Mark L. Cortegiano, Esq.
                     (marklcortegiano@verizon.net)
                  65-12 69th Place
                  Middle Village, NY 11379
                  Tel: (718) 894-9500
                  Fax: (718) 326-3781

Total Assets: $2,571,865

Total Debts:  $5,836,942

Debtor's 59 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Avon Electrical Supplies       Job Materials         $2,006,650
60 Hoffman Avenue              and Lawsuit
Hauppauge, NY 11788

Turtle & Hughes, Inc.          Job Materials         $1,583,515
1900 Lower Road
Linden, NJ 07036

I.R.S.                         Payroll taxes         $649,914
625 Fulton Street
Metrotech Center
Brooklyn, NY 11201

Joint Industry                 Union                 $429,107
Board-Electrical               benefits
158-11 Harry Van Arsdale, Jr.
Flushing, NY 11365

Graybar                        Job Materials         $345,761
21-15 Queens Plaza N.
Long Island City, NY 11101

Millennium Electrical Supply   Lawsuit               $230,438

New York State Tax Department  Payroll               $169,602

Casey Systems                  Equipment rental      $53,692

H.O. Penn Machinery Co., Inc.  Machinery             $43,346

Travelers, The Phoenix         Insurance             $29,134
Insurance Co.

Alrick Goulborne               Wages                 $22,280

New York State Department of   Unemployment          $22,172
Labor                          Insurance

Robert Young                   Wages                 $18,327

Witmann Plumbing               Rent                  $15,600

Arthur Hylton                  Wages                 $13,260

Mark Hylton                    Wages                 $12,965

Michael Garnett                Wages                 $10,850

Leslie Betancourt              Wages                 $10,504

Sprint Customer Service        Cellular              $8,771
Communications

Empire Tools, L.L.C.           Tools &               $8,085
                               Equipment

Kevin Manning                  Wages                 $8,039

Allstate Indemnity                                   $7,689

Leon Noble                                           $6,516

Brian Bishop                                         $6,258

Lawrence Lowy Associates                             $6,104

Leonnard Brown                                       $5,566

Evret Young                                          $5,309

Judlau Contracting, Inc.                             $5,000

Humberto Lopez                                       $4,777

Williams Scotsman                                    $3,754

Odean Campbell                                       $3,721

Calbert Hayles                                       $3,525

Junior Preudhomme                                    $3,344

Deslandes Parks                                      $3,039

Donovan Callum                                       $2,006

Hilti, Inc.                                          $1,963

Rafael Nunez                                         $1,948

Diversified Electrical Prod.                         $1,900

Montana Datacom                                      $1,756

Colonial Hardware Corp.                              $1,437

Raphael Aiken                                        $1,378

New York State Insurance                             $1,270
Fun.

Devon Cameron                                        $1,225

A.I.C.C.O., Inc.                                     $1,189

National Benefit Life                                $857
Insurance Co.

Quill                                                $738

Verizon                                              $616

Action Environmental Service                         $458

Julian Smith                                         $443

Junior Hayles                                        $431

New York State Child Support                         $427
Processing

ThyssenKrupp Safeway, Inc.                           $271

Brooklyn Progress Blue Print                         $245

Water Boy                                            $234

Staples Business Advantage                           $110

New York City Department of                          $75
Finance

Staples Credit Plan                                  $48

D.H.L. Express (U.S.A.), Inc.                        $38

New York City Department of                          $25
Finance

Cheryl Durham                                        unknown


GENERAL MOTORS: Idles Assembly Plant Due to AAM Workers' Strike
---------------------------------------------------------------
American Axle & Manufacturing Inc.'s worker strike has affected
the production of General Motors Corp.'s vehicles equipped with
the former's auto parts sooner that it thought, various sources
report.

GM's production of Chevrolet Silverado and GMC Sierra pickups at
the Pontiac Assembly Center, which has 2,500 hourly and salaried
employees, in Michigan, ceased after the first shift Thursday, the
Associated Press related citing GM spokesman Tom Wickham.

As reported in the Troubled Company Reporter on Feb. 27, 2008,
although the strike of union workers at its supplier American Axle
and Manufacturing Inc. does not affect General Motors Corp.'s
plant production yet, the auto maker says it is following the
protest closely.  GM has a large inventory of pickups and sport
utility vehicles, which are equipped with American Axle's parts.  
However, if the strike lasts longer than the supply, GM's
assembly lines would suffer.

United Auto Workers union president Ron Gettelfinger and Vice
President James Settles disclosed that members at American Axle
began an unfair labor practices strike at 12:01 a.m. on Feb. 26,
2008, following expiration of a four-year master labor agreement.  
Talks broke off Monday with major issues unresolved.

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 Feb. 28, 2008,
Fitch Ratings has affirmed the Issuer Default Rating of General
Motors at 'B', with a Rating Outlook Negative.

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 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.


GENERAL MOTORS: Supplier's Workers Strike Won't Affect S&P Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings on
General Motors Corp. (GM; B/Stable/B-3) are not immediately
affected by the United Auto Workers work stoppage at key
supplier American Axle and Manufacturing Holdings Inc.
(BB/Negative/--) that began Feb. 26.

S&P expects American Axle and the UAW to reach an agreement that
will improve American Axle's cost position.  However, if the
American Axle work stoppage were to persist beyond a brief period
(likely measured in days, not weeks), it would begin to affect
GM's production schedules and there would be a ripple effect on
many of GM's suppliers as well.
     
If S&P came to believe that the American Axle work stoppage would
draw out, S&P could place the ratings on GM on CreditWatch with
negative implications, along with the ratings on certain suppliers
that depend heavily on GM production.  S&P already expects GM's
first-quarter production to be below year-earlier levels, which
should provide some room for a short work stoppage.
     
In addition, S&P estimates that GM has about $27.3 billion in
cash, marketable securities, and readily available assets in its
existing VEBA trust.  The company also has access to $7 billion in
committed U.S. credit lines.


GLOBAL SIGNAL: Fitch Holds 'BB+' Rating on $122.4MM Class F Certs.
------------------------------------------------------------------
Fitch Ratings has affirmed Global Signal Trust III, series 2006-1,
commercial mortgage pass-through certificates as:

  -- $352.4 million class A-1-FX at 'AAA';
  -- $350.0 million class A-1-FL at 'AAA';
  -- $132.2 million class A-2 at 'AAA';
  -- $175.7 million class B at 'AA';
  -- $175.7 million class C at 'A';
  -- $175.7 million class D at 'BBB';
  -- $65.9 million class E at 'BBB-';
  -- $122.4 million class F at 'BB+'.

The affirmations are due to the stable performance of the
collateral.  As of the September 2007 distribution date, the
collateral balance remains unchanged since issuance at $1,550
billion.

The loan is secured by mortgages on 6,322 wireless communication
sites and cross-guaranteed first priority perfected security
interest in 100% of the equity interest of each of the three
borrowers, which have combined interest in 8,123 wireless
communication sites, based on a management report dated Sept. 30,
2007.

As part of its review, Fitch analyzed the management report
provided by the servicer, Midland Loan Services.  As of third-
quarter 2007, aggregate annualized run rate revenue increased to
$402.8 million, a 9.6% increase from issuance.  The actual
servicer-reported debt service coverage ratio was 2.5 times,
compared to 2.3x at issuance.

The tenant type concentration is stable.  As of Sept. 30, 2007,
total revenue contributed by telephony tenants is 80.7% compared
to 77.6% at issuance.


GLOBAL SIGNAL: Fitch Holds 'BB-' Rating on $3.8MM Class G Certs.
----------------------------------------------------------------
Fitch Ratings has affirmed the classes of Global Signal Trust II,
commercial mortgage pass-through certificates, series 2004-2 as:

  -- $148.9 million class A at 'AAA';
  -- $31.3 million class B at 'AA';
  -- $31.3 million class C at 'A';
  -- $31.3 million class D at 'BBB';
  -- $11.8 million class E at 'BBB-';
  -- $35.4 million class F at 'BB';
  -- $3.8 million class G at 'BB-'.

The affirmations are due to the stable performance of the
collateral.  As of the February 2008 distribution date, the
collateral balance remains unchanged from issuance at
$293.8 million.  The loan is secured by 1,169 wireless
communication sites owned, leased, or managed by the borrower,
based on a management report dated Sept. 30, 2007.

As part of its review, Fitch analyzed the management report
provided by the servicer, Midland Loan Services.  As of third-
quarter 2007, aggregate annualized run rate revenue increased to
$56.6 million, a 32.2% increase from issuance.  Over the same time
period, the Fitch adjusted net cash flow increased 23% since
issuance.  Although revenues increased significantly, operating
expenses also increased and the resulting debt service coverage
ratio was relatively stable from issuance: the actual servicer-
reported DSCR was 2.6 times compared to 2.20x at issuance.

The tenant type concentration is stable: total revenues
contributed by telephony tenants is 82.2% compared to 83.2% at
issuance.


IDEARC INC: CEO John Mueller Steps Down After 10 Days of Service
----------------------------------------------------------------
Idearc Inc. said Wednesday that John J. Mueller has resigned as
the company's chairman and chief executive officer for unforeseen
health reasons, effective immediately.

The Idearc board of directors has appointed Frank P. Gatto,
currently executive vice president of Idearc, as interim CEO while
a search is conducted for a permanent replacement.

Donald B. Reed, lead independent director of Idearc, said: "We
appreciate all of [Mr. Mueller]'s contributions to Idearc, and we
regret that he will be unable to serve as the company's chairman
and CEO."

Mr. Reed continued: "[Mr. Mueller] was instrumental in
establishing Idearc as a public company following its spin-off
from Verizon Communications.  Despite the fact that [Mr. Mueller]
was just recently appointed to the role of CEO, the Board fully
understands and supports his decision to focus on his health as a
top priority."

"Frank Gatto is a proven leader with 30 years of experience in the
directory, telecommunications, and manufacturing industries.  The
Board is confident that Frank's extensive knowledge of our
business and his executive experience are strong assets to the
company during this time of transition," Mr. Reed concluded.

As executive vice president of Idearc, Mr. Gatto, 53, is
responsible for leadership of Idearc's sales operations, customer
care, strategic planning, marketing, advertising, publishing,
printing, directory distribution, information technology, billing
and collections.  Prior to becoming EVP, Mr. Gatto advanced
through several positions at Idearc including president for the
northeast region of the United States and senior vice president
for operations support.

Mr. Gatto began his company career in 1978 and progressed through
positions including assistant vice president -- investment and
strategic planning for GTE Service Corp., and vice president --
finance and planning for GTE Airfone.  Prior to joining Idearc, he
was vice president -- finance and chief financial officer for the
Puerto Rico Telephone Company, where he had served from September
1999 to September 2001.

Mr. Gatto earned a bachelor's degree in economics from Villanova
University and a master's of business administration degree in
finance from Boston College.

Mr. Gatto said, "I am honored to assume the role of CEO of Idearc
on an interim basis, and look forward to leading the Company
during this time of transition.  As we continue our evolution to a
multi-platform business, I know our employees will remain
committed to meeting the needs of our customers, while positioning
the Company to further enhance value for our investors."

                        Mueller Appointment

On Feb. 19, 2008, Idearc disclosed that Mr. Mueller was appointed
CEO, effective as of Feb. 16, 2008, to replace Katherine J.
Harless, also the company's president.

At that time, the company expected to enter into an employment
agreement with Mr. Mueller.  His employment agreement was to be a
three-year term with a base salary of $900,000 per year,
reviewable annually, short-term bonus award target of 100% of base
salary, long-term incentive award target of 300% of base salary,
and a restricted stock award worth $1,000,000 to be granted upon
the signing of the employment agreement and vesting equally over
three years.

Mr. Mueller, 51, was chairman of the board and has served in that
role since November 2006.  Prior to his appointment as CEO, Mr.
Mueller was a business consultant and the interim chief executive
officer of Connexion Technologies, a fiber-optic amenity company
that builds and operates entertainment and communication networks
coast to coast.  He is a current member of the board of directors
of Centennial Communications Corp., a provider of regional
wireless and integrated communications services.

Previously, Mr. Mueller was chief executive officer and president
of Valor Telecommunications LLC from 2004 to 2006, prior to the
integration of Valor and Alltel's wireline businesses, which is
now known as Windstream.  From 2005 to 2006, he also served as
chief executive officer and president and as a member of the board
of directors of Valor Communications Group, Inc., Valor's parent
company.  Prior to becoming chief executive officer and president,
Mueller served as Valor's president and chief operating officer.
Before joining Valor, Mueller spent 23 years at Cincinnati Bell
Inc., serving in various positions including: president,
Cincinnati Bell Telephone Company; general manager -- consumer
markets; and president and chief executive officer of CBD,
Cincinnati Bell's directory subsidiary.

                       About Idearc Inc.

Dallas, Texas-headquartered Idearc Inc. (NYSE: IAR) --  
http://www.idearc.com/-- is yellow pages directories publisher in  
the United States.  Its products include print yellow pages, print
white pages, an Internet yellow pages directory, Superpages.com
and an information directory for wireless subscribers, Superpages
MobileSM.  The company publishes its directories in approximately
360 markets in 35 states across the United States and the District
of Columbia.  The company completed its spin-off from Verizon on
Nov. 17, 2006, but had various agreements with Verizon, including
a 30-year publishing agreement as the official publisher of
Verizon print directories with rights to publish yellow pages
under the Verizon brand in both its incumbent and independent
markets.  On July 20, 2006, it purchased Inceptor Inc., a provider
of Internet search engine marketing technology.

                        *     *     *

As reported in the Troubled Company Reporter on Feb. 13, 2008,
Standard & Poor's Ratings Services revised its rating outlook on
Idearc Inc. to negative from stable.  Ratings on the company,
including the 'BB' corporate credit rating, were affirmed.


IMPLANT SCIENCES: Posts $4,815,000 Net Loss in Qtr. Ended Dec. 31
-----------------------------------------------------------------
Implant Sciences Corporation reported a net loss of $4,815,000  
for the second quarter ended Dec. 31, 2007, compared to a net loss
of $397,000 for the three months ended Dec. 31, 2006.  Net loss
for the six months ended Dec. 31, 2007, was $7,017,000, compared
to a net loss of $2,007,000 for the six months ended Dec. 31,  
2006.  

Included in the net loss in each of the three and six months ended
Dec. 31, 2007,is an approximate $2,224,000 charge for the
impairment of long-lived assets and goodwill associated with the
company's semiconductor reporting unit.

Total revenues for the three months ended Dec. 31, 2007, were
$1,884,000 as compared to $4,858,000 for the comparable prior year
period, a decrease of $2,974,000 or 61%.  Total revenues for the
six months ended Dec. 31, 2007, were $5,102,000 as compared to
$8,122,000 for the comparable prior year period, a decrease of
$3,020,000 or 37%.  

The decrease in total revenues for the three and six month periods
ended Dec. 31, 2007, as compared to the comparable prior year
periods is attributable to i) the company's continuing efforts to
withdraw from medical operations; ii) downtime in the company's
semiconductor business resulting from the consolidation in
Sunnyvale, California; and iii) reduced sales of security
equipment resulting from the restructuring of the company's
security sales and marketing efforts.

As of Dec. 31, 2007, the company's cash position decreased by
$4,817,000 to $4,804,000 as compared to $9,621,000 as of June 30,
2007.  

"Our fiscal 2008 second quarter has been a period of change
requiring significant investment in the repositioning of our
business to clearly focus on opportunities in the Safety, Security
and Defense market," stated Phillip C. Thomas, chief executive
officer and president.  "We believe the costs incurred in the
second quarter ended Dec. 31, 2007, which contributed to the
approximate $2.9 million second quarter loss, before the effect of
a $2.2 million non-cash impairment charge related to our
semiconductor business unit, have been necessary to improve our
overall position in the market.  

"Meanwhile, we have improved the quality of our current explosives
detection products, restructured our sales and marketing groups to
effectively target and close on orders for security products,
added industry savvy product development personnel to identify
security market opportunities and products necessary to meet
market demands, and expanded our scientific and technical
resources to develop new commercial products.  I am confident the
actions undertaken by the company over the past year, and
especially during our second quarter of fiscal 2008, provide the
foundation necessary to grow our SS&D business with the
achievement of sustained profitability being our main goal."

                          Balance Sheet

At Dec. 31, 2007, the company's consolidated balance sheet showed
$11,212,000 in total assets, $5,183,000 in total liabilities,
$2,813,000 in Series D cumulative redeemable convertible preferred
stock, and $3,216,000 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?288e

                      About Implant Sciences

Based in Wakefield, Massachusetts, Implant Sciences Corporation --  
http://www.implantsciences.com/-- develops, manufactures and  
sells products through its primary business units: (i) explosives
trace detection systems for homeland security, defense, and other
security related applications and (ii) state of the art services
for the medical and semiconductor industries.  The company has
developed proprietary technology used in its commercial portable
and bench-top ETD systems, which ship to a growing number of
locations domestically and around the world.

                           *     *     *

As reported in the Troubled Company Reporter on Oct. 19, 2007,
UHY LLP raised substantial doubt about Implant Sciences  
Corporation's ability to continue as a going concern after
auditing the company's financial statements for the fiscal year
ended June 30, 2007.  The auditing firm pointed to the company's
recurring losses from operations.


IPS CORP: Moody's Changes Outlook to Negative; Holds 'B2' Ratings
-----------------------------------------------------------------
Moody's Investors Service changed IPS Corporation's rating outlook
to negative from stable.  Moody's also affirmed the B2 corporate
family rating and B2 probability of default rating, as well as the
Ba2 senior first lien debt ratings and the Caa1 rating on the
senior subordinated notes.  The change in outlook is predicated on
Moody's expectation of more challenging market conditions for IPS
in the near term, which could create downward pressures on the
company's operating performance and less solidly position IPS in
the B2 rating category.

In the next few months, the rating agency believes that IPS will
continue to face depressed conditions in the new residential
construction market.  Additionally, there is in Moody's opinion, a
material risk of weaker housing-related consumer spending, which
could affect the remodeling market, and deteriorating conditions
in commercial construction.  Against this backdrop, it is less
likely that IPS'growing international business will continue to
offset poor domestic performance.

The generation by IPS of negative free cash flow, an increase in
debt/EBITDA to a level above 6.5 times or the deterioration of
liquidity, which is currently considered acceptable by Moody's in
view of the company's cash balances, would lead to a downgrade.

Headquartered in Compton, California, IPS Corporation is a
manufacturer of a wide range of adhesive cements and plumbing
products primarily for the new residential, remodeling and
commercial construction markets.


IRVINE SENSORS: Posts $3.7 Million Net Loss in Qtr. Ended Dec. 30
-----------------------------------------------------------------
Irvine Sensors Corp. reported a net loss of $3.7 million for the
fiscal 2008 first quarter ended Dec. 30, 2007, compared with a net
loss of $6.4 million in the corresponding period ended Dec. 31,
2006.

The net loss in the fiscal 2007 quarter includes a $4.4 million  
nonrecurring loss on extinguishment of debt.

Total revenues were $8.0 million as compared to $8.1 million in
the first quarter of fiscal 2007.  The virtually unchanged
consolidated total revenues reflected an approximate $1.5 million
decline in revenues of the company's Costa Mesa operation, largely
in contract research and development revenue, offset by an
approximate $1.3 million increase in product sales of the
company's Optex subsidiary.

                          Balance Sheet

At Dec. 30, 2007, the company's consolidated balance sheet showed
$34.0 million in total assets and $31.7 million in total
liabilities, and $2.3 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended Dec. 30, 2007, are available for
free at http://researcharchives.com/t/s?2891

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on Jan. 24, 2008,
Grant Thornton LLP expressed substantial doubt about Irvine
Sensors Corp.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
Sept. 30, 2007.

The auditing firm reported that the company incurred net losses
for the years ended Sept. 30, 2007, Oct. 1, 2006 and Oct. 2, 2005,
respectively, and the company has working capital of only
$1,799,100 at Sept. 30, 2007.

                       About Irvine Sensors

Based in Costa Mesa, California, Irvine Sensors Corporation
(Nasdaq: IRSN) -- http://www.irvine-sensors.com/-- is a vision  
systems company engaged in the development and sale of
miniaturized infrared and electro-optical cameras, image
processors and stacked chip assemblies, the manufacture and sale
of optical systems and equipment for military applications through
its Optex subsidiary and research and development related to high
density electronics, miniaturized sensors, optical interconnection
technology, high speed network security, image processing and low-
power analog and mixed-signal integrated circuits for diverse
systems applications.


IXIS REAL: S&P Slashes Five Classes' Ratings on Weak Performance
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on five
classes of mortgage pass-through certificates from IXIS Real
Estate Capital Trust 2004-HE4.  Concurrently, S&P affirmed its
ratings on the remaining two classes from this deal.
     
The downgrades reflect collateral performance that has eroded
available credit support during recent months.  As of the January
2008 remittance period, cumulative losses were $9.6 million, or
1.34% of the original principal balance.  Serious delinquencies
(90-plus days, foreclosures, and REOs) were $18.46 million, about
18.5x greater than the current overcollateralization, which is
$2.55 million below its $3.6 million target.  Losses have
consistently outpaced excess interest for eight of the 12 most
recent months.
     
Current and projected credit support percentages are sufficient to
support the affirmed ratings at their current levels.
     
Subordination, overcollateralization, and excess spread provide
credit support for this series.  The collateral for this
transaction consists primarily of fixed- and adjustable-rate
conventional, fully amortizing, and balloon mortgage loans secured
by first and second liens on one- to four-family residential
properties.

                         Ratings Lowered

             IXIS Real Estate Capital Trust 2004-HE4
               Mortgage pass-through certificates

                               Rating
                               ------
                     Class   To       From
                     -----   --       ----
                     M-3     BB-      A-
                     B-1     B        BBB+
                     B-2     B-       BBB
                     B-3     CCC      BBB-
                     B-4     CCC      BB

                        Ratings Affirmed

            IXIS Real Estate Capital Trust 2004-HE4
              Mortgage pass-through certificates

                        Class   Rating
                        -----   ------
                        M-1     AA
                        M-2     A


JAMES LULL: Debt from "Ponzi Scheme" May Have Reached $50 Million
-----------------------------------------------------------------
The debt of James W. Lull, former branch manager of U.S. Financial
Mortgage Corp., is expected to reach $50 million, Jim Dooley
writes for the Honolulu Advertiser, citing trustee counsel,
Stephen Jones, Esq.

Mr. Lull filed personal bankruptcy in December 2006, and at that
time, disclosed having $6.7 million in assets and $31 million in
debts, Advertiser reports.

According to trustee Ronald Kotoshirodo, Mr. Lull ran a "Ponzi
scheme" convincing several people in Kaua'i, Hawaii to put up
investments and promising to give them high returns, Advertiser
says.  Based on the report, Mr. Lull told investors he was using
the people's money to fund real property development as bridge
loans.

                      About "Ponzi" Schemes

The U.S. Securities and Exchange Commission stated at --
http://www.sec.gov/answers/ponzi.htm-- that Ponzi schemes are a  
type of illegal pyramid scheme named for Charles Ponzi, who duped
thousands of New England residents into investing in a postage
stamp speculation scheme back in the 1920s.

Decades later, the Ponzi scheme continues to work on the "rob-
Peter-to-pay-Paul" principle, as money from new investors is used
to pay off earlier investors until the whole scheme collapses.

                       Defrauded Investors

James Wagner, Esq., argued that his client did not operate a Ponzi
scheme, and Mr. Lull, who served U.S. Financial Mortgage Corp.
from 1994 until 2004, has not been found guilty, Advertiser says.  
Contrary to the trustee's claim, Mr. Wagner argued that his
client's debt is only between $10 million and $20 million,
Advertiser reports.

Among his defrauded investors are three-time world champion surfer
Philip A. Irons and brother, Bruce, who were owed $1 million
sometime 1998 through 2006.

In January 2008, the Hon. Lloyd King for the U.S. Bankruptcy Court
for the District of Hawaii found that Mr. Lull obtained a total of
about $3,000,000 from Donald Tipaldi from 2004 through 2006,
Advertiser reveals.

Judge King ruled that Mr. Lull intended "to defraud" Mr. Tipaldi,
the report relates.

Mr. Tipaldi filed his claims with the Court asserting that Mr.
Lull used his money for personal gain and stating that around
March 2006, Mr. Lull issued him a $300,000 check that bounced.

Mr. Lull also owed Stephani and William Britt about $500,000 in
life savings in 2006, Advertiser adds.  The couple, says the
report, had already paid Elijah Yip, Esq., at least $40,000 in
efforts to get their money back.

FBI spokesman Brandon Simpson told Advertiser he can't ascertain
if a criminal investigation on Mr. Lull's activities is ongoing.

James W. Lull currently lives in the State of Washington.  He
listed three real properties -- two on Kuaa'i and one in Idaho --
as principal assets worth around $6 million, but had mortgages of
about $8.4 million.


KEFTON CDO: Moody's Junks Rating on Up To $67 Mil. Notes From 'A3'
------------------------------------------------------------------
Moody's Investors Service downgraded ratings of six classes of
notes issued by Kefton CDO I, LTD.  The notes affected by this
rating action are:

Class Description: Up to $67,000,000 Class II Senior Floating Rate
Notes Due January 2047

  -- Prior Rating: A3, on review for possible downgrade
  -- Current Rating: C

Class Description: Up to $70,000,000 Class III Senior Floating
Rate Notes Due January 2047

  -- Prior Rating: Baa2, on review for possible downgrade
  -- Current Rating: C

Class Description: Up to $14,500,000 Class IV Senior Floating Rate
Notes Due January 2047

  -- Prior Rating: Baa3, on review for possible downgrade
  -- Current Rating: C

Class Description: Up to $27,000,000 Class V Mezzanine Floating
Rate Deferrable Notes Due January 2047

  -- Prior Rating: Ca
  -- Current Rating: C

Class Description: Up to $24,000,000 Class VI Mezzanine Floating
Rate Deferrable Notes Due January 2047

  -- Prior Rating: Ca
  -- Current Rating: C

Class Description: Up to $8,000,000 Class VII Mezzanine Floating
Rate Deferrable Notes Due January 2047

  -- Prior Rating: Ca
  -- Current Rating: C

The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence as reported by
the Issuer on Feb. 12, 2008, of an event of default caused when
the Par Value Coverage Amount divided by the sum of the Available
Supersenior Swap Amount plus the Aggregate Outstanding Amount of
the Class II Notes and the Used Supersenior Swap Amount is less
than 101 percent, pursuant to Section 5.1(d) of the Indenture
dated Dec. 14, 2006.  This event of default is still continuing.   
Kefton CDO I, Ltd. is a collateralized debt obligation backed
primarily by a portfolio of RMBS securities.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.  In this
regard the Trustee reports that the Controlling Class has directed
the Trustee to accelerate the Notes and to proceed with the sale
of the Collateral.

The rating downgrades taken reflect the increased expected loss
associated with each tranche.  Losses are attributed to diminished
credit quality on the underlying portfolio.


KELLWOOD CO: S&P Chips Rating to B+ After Sun Capital Tender Offer
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on women's
apparel designer and marketer Kellwood Co., including its
corporate credit rating, to 'B+' from 'BB-'.  S&P also removed the
ratings from CreditWatch, where they were initially placed with
negative implications on Sept. 19, 2007, and subsequently withdrew
the ratings.
     
These rating actions follow the completion of Sun Capital
Securities LLC's tender offer to Kellwood's shareholders.  Sun
Capital, through an affiliate, became the majority holder of
Kellwood's common stock.  Kellwood is now an operating subsidiary
of Sun Capital, and is no longer required to file financial
statements with the SEC.
     
The initial CreditWatch listing on Sept. 19, 2007, followed
Kellwood's receipt of an unsolicited bid from Sun Capital to buy
the company.  Ratings were subsequently lowered on Oct. 17, 2007,
reflecting weak underlying business trends and the tougher
operating environment in retail, as well as weakening credit
protection measures.  "This downgrade reflects the challenging
retail environment, the company's weak credit metrics that have
continued to decline from historical levels, and our expectation
that the company will pursue a more aggressive financial policy
going forward," said Standard & Poor's credit analyst Susan Ding.
     
While Sun capital has not disclosed any information regarding
Kellwood's capital structure following the acquisition, S&P
expects that the company will remain highly leveraged.  Leverage
has remained in the 4.5x- 4.8x within the past several years.


LASALLE COMM: Increased Loss Expectations Cue Fitch to Cut Ratings
------------------------------------------------------------------
Fitch Ratings has downgraded and assigned distressed recovery
ratings to LaSalle Commercial Mortgage Securities, Inc. commercial
mortgage pass-through certificates, series 2006-MF3, as:

  -- $3.7 million class E to 'BBB-' from 'BBB';
  -- $6.8 million class G to 'B+' from 'BB';
  -- $2.5 million class H to 'B-' from 'BB-';
  -- $1.9 million class J to 'CCC/DR1' from 'B+';
  -- $1.2 million class K to 'CCC/DR1' from 'B';
  -- $2.5 million class L to 'C/DR6' from 'B-';
  -- $1.2 million class M to 'C/DR6' from 'CCC/DR1'.

Fitch also affirmed these classes:

  -- $386.8 million class A at 'AAA';
  -- Interest-only class X at 'AAA';
  -- $8.0 million class B at 'AA';
  -- $13.0 million class C at 'A';
  -- $8.0 million class D at 'BBB+';
  -- $4.9 million class F at 'BBB-'.

Fitch does not rate the $7.1 million class N certificates.

The downgrades are the result of additional specially serviced
loans and increased loss expectations since Fitch's last rating
action.  Fitch expects losses to ultimately deplete the non-rated
class N and negatively impact credit enhancement levels.

As of the February 2008 remittance report, the transaction has
been reduced 9.3% to $447.6 million from $493.4 million at
issuance.  Fitch identified 173 loans (41%) as loans of concern as
a result of declines in occupancy and performance as well as the
transaction's 23 (6.2%) specially serviced loans.

The largest specially serviced loan (0.8%) is secured by a
multifamily property in Lubbock, Texas and is 90 days delinquent.  
The property continues to show declines in occupancy and
performance since issuance.  The special servicer is proceeding
with foreclosure.

The second largest specially serviced loan (0.6%) is secured by a
multifamily property in Oklahoma City, Oklahoma and is 90 days
delinquent.  The property is in poor condition with declining
performance.  The special servicer filed for foreclosure in
December 2007 and a receiver was placed at the property in January
2008.

The third largest specially serviced loan (0.4%) is secured by a
multifamily property in Tampa, Florida and is 90 days delinquent.  
The property operations have been impacted due to poor management.  
The special servicer is in the process of proceeding with
foreclosure.


LENNAR CORP: Receives Purchase Offer from UAE Group, Report Says
----------------------------------------------------------------
A group from the United Arab Emirates has offered to buy Lennar
Corp., according to Ilaina Jonas of Reuters, citing a report
posted at Theflyonthewall.com

The report cited Buck Horne, an analyst with Raymond James and
Associates, as saying that Goldman Sachs Group Inc. was rumored to
have been hired as the investment banker for the deal.

The report of the possible sale and a remark by real estate tycoon
Sam Zell predicting a start of a recovery in the housing market
this spring buoyed the company's share 8.7 percent, or $1.63, to
$20.41 on the New York Stock Exchange, according to the report.

As reported by the Troubled Company Reporter on Jan. 28, 2008,
Lennar reported fourth quarter net loss in 2007 was $1.3 billion,
compared to a net loss of $195.6 million in 2006.  It reported net
loss for the year ended Nov. 30, 2007 of $1.9 billion, compared to
net earnings of $593.9 million for the year ended Nov. 30, 2006.

The company has completed an amendment to its senior unsecured
revolving credit facility that modified certain covenants, which
included minimum tangible net worth, borrowing base and maximum
leverage ratio, as well as added a new covenant to reduce the
recourse indebtedness of joint ventures in which the company
participates.  Under this amendment, the maximum amount the
company can borrow was reduced from $3.1 billion to $1.5 billion.

Following the earnings report, Standard & Poor's Ratings Services
said that its corporate credit rating, debt ratings, and outlook
on Lennar Corp.(BB+/Negative/--) are not immediately affected by a
large loss in its fiscal fourth-quarter 2007.  

                        About Lennar Corp.

Headquartered in Miami, Florida, Lennar Corporation (NYSE: LEN and
LEN.B) -- http://www.lennar.com/-- founded in 1954, builds
affordable, move-up and retirement homes primarily under the
Lennar brand name.  Lennar's Financial Services segment provides
mortgage financing, title insurance, and closing services for both
buyers of the company's homes and others.


LIBERTY MEDIA: Gains 41% Interest in DirecTV After Swap
-------------------------------------------------------
Liberty Media Corporation has completed the exchange of its
16.3% stake in News Corporation for a subsidiary of News that
holds a 41% stake in The DIRECTV Group Inc., regional sports
networks in Denver, Pittsburgh, and Seattle, and $465 million of
cash.

John Malone and Greg Maffei have been appointed to the DIRECTV
board, filling two of the three seats previously held by News
representatives.  Chase Carey will continue to serve as DIRECTV's
president and CEO.

"This transaction is strategically important, financially
attractive, and will provide new focus to Liberty Media," said
Liberty CEO Greg Maffei.  "We've been impressed with Chase Carey
and his team and are thrilled to welcome them to the Liberty
family.  We look forward to a partnership with DIRECTV."

The reclassification of Liberty Capital Tracking stock is expected
to be completed in the next three to five business days and the
new Liberty Entertainment and Liberty Capital tracking stocks will
commence trading early next week.

                        About News Corp.

News Corporation is a diversified international media and
entertainment company with operations in eight industry segments:
filmed entertainment; television; cable network programming;
direct broadcast satellite television; magazines and inserts;
newspapers; book publishing; and other.  The activities of News
Corporation are conducted principally in the United States,
Continental Europe, the United Kingdom, Australia, Asia and the
Pacific Basin.

                       About DirecTV Group

Headquartered in El Segundo, California, The DirecTV Group Inc.
(NASDAQ:DTV) -- http://www.DirecTV.com/-- provides digital   
television entertainment in the United States and Latin America.   
The company's two business segments, DirecTV U.S. and DirecTV
Latin America, are engaged in acquiring, promoting, selling and/or
distributing digital entertainment programming via satellite to
residential and commercial subscribers.  DirecTV Holdings LLC and
its subsidiaries are a provider of direct-to-home digital
television services and a provider in the multi-channel video
programming distribution industry in the United States.  DTVLA is
a provider of DTH digital television services throughout Latin
America.  In January 2007, the company acquired Darlene
Investments LLC's 14.1% equity interest in DirecTV Latin America,
LLC.  DirecTV Latin America LLC is a multinational company, which,
as a result of this transaction, became a wholly owned subsidiary
of the company.

                          *     *     *

In April 2007, Standard and Poor's Ratings Services assigned a
'BB+' Rating on The DirecTV Group Inc.'s long-term foreign and
local issuer credit rating with a stable outlook.  This rating
action still holds to date.

                       About Liberty Media

Headquartered in Englewood, Colorado, Liberty Media Corporation
(NasdaqGS: LINTA) -- http://www.libertymedia.com/-- owns
interests in a broad range of electronic retailing, media,
communications and entertainment businesses.  Those interests are
attributed to two tracking stock groups: the Liberty Interactive
group, which includes Liberty's interests in QVC, Provide
Commerce, IAC/InterActiveCorp, and Expedia, and the Liberty
Capital group, which includes Liberty's interests in Starz
Entertainment, News Corporation, and Time Warner.

                          *     *     *

Liberty Media Corporation continues to carry Fitch Ratings' 'BB'
long-term issuer default and senior unsecured debt ratings, which
were placed in December 2006.


LIBERTY MEDIA: FCC Sees DirecTV Group Deal to Benefit Public
------------------------------------------------------------
The Federal Communications Commission approved the transfer of
control of DirecTV Group Inc. to Liberty Media Corp., subject to
conditions.  The Commission concluded that, as conditioned, the
public interest benefits of the transfer outweighed the potential
harms and would be consistent with applicable Commission rules and
policies.

As reported in the Troubled Company Reporter on Feb. 11, 2008,
under the deal, News Corp. will exchange its interest in DirecTV
Group Inc. with Liberty Media's interest in News Corp.  Liberty
Media said it plans to exchange its stake in News Corp. for 39% of
DirectTV.  The parties reached an $11 billion deal that includes
News Corp.'s stake in DirectTV.

As a benefit of the transaction, Liberty Media and News Corp.,
which is the majority stakeholder of DirecTV, would sever their
ownership interests with each other which will decrease media
consolidation and reduce vertical integration therefore benefiting
the public.

The Order also imposes certain conditions to ensure that the
transaction will serve Commission's competition and diversity
goals.  The Order requires that Liberty and DirecTV abide by
program access, program carriage, Regional Sports Network  
arbitration, retransmission consent arbitration conditions,
modeled on similar conditions imposed in 2003, when the Commission
approved the transfer of DIRECTV from Hughes to News Corp.

In addition, the Order requires that all of the attributable
ownership interests connecting DirecTV-Puerto Rico and Liberty
Cablevision of Puerto Rico, Ltd., which will be under common
control as a result of the transaction, be severed within one
year, at which point the companies must certify either that they
have reduced the relevant interests to a non-attributable level or
that they have filed any applications necessary to divest assets.

On balance, the Commission found that the transaction, as
conditioned, would serve the public interest.

                         About News Corp.

News Corporation is a diversified international media and
entertainment company with operations in eight industry segments:
filmed entertainment; television; cable network programming;
direct broadcast satellite television; magazines and inserts;
newspapers; book publishing; and other.  The activities of News
Corporation are conducted principally in the United States,
Continental Europe, the United Kingdom, Australia, Asia and the
Pacific Basin.

                           About DirecTV

Headquartered in El Segundo, California, The DIRECTV Group Inc.
(NYSE: DTV) -- http://www.directv.com/ -- provides digital     
television entertainment services.  Through its subsidiaries
and affiliated companies in the United States, Brazil, Mexico and
other countries in Latin America, the DIRECTV Group provides
digital television service to more than 16.5 million customers in
the United States and over 4.6 million customers in Latin America.

                          *     *     *

In April 2007, Standard & Poor's Ratings Services affirmed the
'BB' corporate credit and 'BB-' senior unsecured debt rating on
The DIRECTV Group Inc.  S&P said the outlook is stable.

In addition, Standard & Poor's raised the bank loan rating on
$2 billion of credit facilities at DIRECTV Holdings LLC, a wholly
owned subsidiary of The DIRECTV Group Inc, to 'BB+' from 'BB' and
revised the recovery rating to '1' from '3'.

                       About Liberty Media

Headquartered in Englewood, Colorado, Liberty Media Corporation
(NasdaqGS: LINTA) -- http://www.libertymedia.com/-- owns
interests in a broad range of electronic retailing, media,
communications and entertainment businesses.  Those interests are
attributed to two tracking stock groups: the Liberty Interactive
group, which includes Liberty's interests in QVC, Provide
Commerce, IAC/InterActiveCorp, and Expedia, and the Liberty
Capital group, which includes Liberty's interests in Starz
Entertainment, News Corporation, and Time Warner.

                          *     *     *

Liberty Media Corporation continues to carry Fitch Ratings' 'BB'
long-term issuer default and senior unsecured debt ratings, which
were placed in December 2006.


LILLIAN VERNON: Has Interim Authority to Tap $8.5MM DIP Financing
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave
interim authority to Lillian Vernon Corp. and its debtor-
affiliates to obtain up to $8,500,000 in postpetition financing
from Wachovia Bank, N.A., as agent for a consortium of lenders.

The Debtors also won permission to use their lenders' cash
collateral.

Prior to the Debtors' bankruptcy filings, Wachovia and the other
lenders made loans, advances, and financial accommodations to the
Debtors pursuant to a loan and security agreement, as amended.  As
of the date of bankruptcy, the aggregate amount of all loans,
letters of credit and other obligations owed by the Debtors to the
lenders under the financing agreements was approximately
$15,569,767.  The prepetition obligations include a revolving
Loan B in the aggregate outstanding principal amount of
$10,000,000, plus interest.

The lenders claimed valid, first priority security interests and
liens upon all of the prepetition collateral -- subject only to
liens provided in the existing loan agreement --  as security for
the repayment of prepetition obligations less the amount of Loan B
obligations.

The Debtors are also indebted to their subordinated noteholders on
a certain note purchase agreement.  The investor-noteholders claim
a second priority lien on substantially all of the Debtors'
personal assets and general intangibles.  As of the date of
bankruptcy, the indebtedness under the loan agreement was
approximately $7.5 million plus interest.  In addition, the
Debtors have placed letters of credit to secure the performance
under certain real property and personal property leases for
$600,000.

The Debtors told the Court that they don't have sufficient
available cash to meet ongoing obligations necessary to run their
businesses, and that it needs to urgently obtain credit and
additional capital to pursue going concern interests.

The Debtors and Wachovia have entered into a ratification and
amendment agreement, whereby the lenders would extend financing to
the bankruptcy estate.

The DIP loan will not exceed $8,500,000 -- and will not exceed
$18,500,000 when including Revolving Loan B -- on a final basis.

The term of the postpetition financing will end on:

   -- May 31, 2008; or
   -- the confirmation of the Debtors' plan of reorganization.

In addition, the Court allowed the Debtors, on the interim, to
grant the lenders superpriority administrative claims status
pursuant to Section 364(c)(1) of the U.S. Bankruptcy Code in
respect of all postpetition obligations.

The Debtors are required to pay a $100,000 closing fee, as well as
a host of other fees for any unused portion of the facility.

The Debtors can also use cash collateral subject to the liens and
security interest of the lenders, and give adequate protection by
providing the lenders with replacement liens and superpriority
administrative claims status.

                       About Lillian Vernon

Based in Virginia Beach, Virginia, Lillian Vernon Corp. --
http://www.lillianvernon.com/-- and its affiliates are direct   
mail specialty catalog and online companies concentrating on the
marketing of gifts, holiday products, toys and children's
products, personal and home accessories, kitchen and houseware
products and garden and outdoor products.  They have developed a
proprietary customer database containing information about its
customers, including such data as order frequency, size and date
of last order and type of products purchased.  The database
contains information with respect to over 27 million customers,
gift recipients and people who have requested its catalogs.  In
the fiscal year ended February 22, 2003, they published 33 catalog
editions and mailed approximately 150,000,000 catalogs to past and
prospective customers.  They also offer products over the
Internet.  

The company and six of its affiliates filed for Chapter 11
protection on Feb. 20, 2008 (Bankr. D.D., Delaware,  Case No. 08-
10323).  Ann C. Cordo, Esq., Daniel B. Butz, and Esq., J. Dehney,
Esq. at Morris, Nichols, Arsht & Tunnell, L.L.P. represent the
Debtors in their restructuring efforts.  Lillian Vernon's parent,
Sun Capital Partners Inc., a privately held investment company
with offices in Boca Raton, Fla., is not included in the
bankruptcy filing.  The company listed assets of $1 million to
$100 million and debts of $1 million to $100 million in its
bankruptcy filing.


LONGPORT FUNDING: Six Classes of Notes Get Moody's Junk Ratings
---------------------------------------------------------------
Moody's Investors Service downgraded ratings of seven classes of
notes issued by Longport Funding III, Ltd., and left on review for
possible further downgrade the rating of one of these classes of
notes.  The notes affected by this rating action are:

Class Description: $450,000,000 Class A1-VF Senior Secured
Floating Rate Notes Due 2051

  -- Prior Rating: Aaa, on review for possible downgrade
  -- Current Rating: Ba3, on review for possible downgrade

Class Description: $63,750,000 Class A2A Senior Secured Floating
Rate Notes Due 2051

  -- Prior Rating: A2, on review for possible downgrade
  -- Current Rating: Ca

Class Description: $45,000,000 Class A2B Senior Secured Floating
Rate Notes Due 2051

  -- Prior Rating: A3, on review for possible downgrade
  -- Current Rating: Ca

Class Description: $97,500,000 Class B Senior Secured Floating
Rate Notes Due 2051

  -- Prior Rating: Baa2, on review for possible downgrade
  -- Current Rating: Ca

Class Description: $26,250,000 Class C Mezzanine Secured
Deferrable Interest Floating Rate Notes Due 2051

  -- Prior Rating: B3, on review for possible downgrade
  -- Current Rating: C

Class Description: $26,250,000 Class D Mezzanine Secured
Deferrable Interest Floating Rate Notes Due 2051

  -- Prior Rating: Caa2, on review for possible downgrade
  -- Current Rating: C

Class Description: $12,000,000 Class E Mezzanine Secured
Deferrable Interest Floating Rate Notes Due 2051

  -- Prior Rating: Caa3, on review for possible downgrade
  -- Current Rating: C

The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence, as reported
by the Trustee on Feb. 12, 2008, of an event of default caused by
a failure of the Class A1-VF Overcollateralization Ratio to be
greater than or equal to 100 per cent pursuant Section 5.1(i) of
the Indenture dated April 4, 2007.

Longport Funding III, Ltd. is a collateralized debt obligation
backed primarily by a portfolio of RMBS securities.

Recent ratings downgrades on the underlying portfolio caused
ratings-based haircuts to affect the calculation of
overcollateralization.  Thus, the Class A1-VF
Overcollateralization Ratio failed to meet the required level.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.

The rating downgrades taken reflect the increased expected loss
associated with each tranche.  Losses are attributed to diminished
credit quality on the underlying portfolio.  The severity of
losses of certain tranches may be different, however, depending on
the timing and choice of remedy to be pursued by certain
Noteholders.  Because of this uncertainty, the rating assigned to
Class A1-VF Notes remains on review for possible further action.


LOUISIANA-PACIFIC CORP: Moody's Chips Senior Debt Rating to ' Ba2'
------------------------------------------------------------------
Moody's Investors Service downgraded Louisiana-Pacific
Corporation's senior unsecured debt rating to Ba2 from Baa3,
concluding a review for possible downgrade initiated on Feb. 13,
2008.  At the same time, Moody's assigned a Ba2 corporate family
rating and SGL-2 liquidity rating to LP.  The downgrade reflects
LP's deteriorating financial performance, weakened credit
protection metrics, and reduced liquidity position with the
expectation that market conditions will remain challenging over
the next 12 to 18 months.  The rating outlook is negative.

The severe downturn in new residential construction, the reduction
in home repairs and remodeling activities, the oriented
strandboard capacity additions, and the impact of tighter home
mortgage standards on housing starts are expected to continue to
create a weak pricing environment for the company's principal
products.  The company's credit protection metrics remain
challenged by the extremely weak pricing of LP's core product -
OSB, the company's volatile cash flow stream, its relatively
modest size, and its single product line and geographic
concentration.  These challenges are partially offset by the
company's low debt level and good liquidity position, however, a
material portion of LP's previously sizeable cash and short-term
investments have been applied towards funding negative cash flows
and the company has some of its bank debt maturing over the next
12 months.

The Ba2 rating anticipates that 2008 and 2009 will be challenging
years and LP's credit protection metrics will continue to
deteriorate.  With current US housing starts hovering around 1
million starts and with industry OSB capacity aligned towards
approximately 2 million starts, OSB pricing is not expected to
materially increase over the next few years.  OSB pricing has
remained at or below cash costs for most of the past 18 months and
Moody's expectation is that OSB pricing will remain challenged
until industry capacity utilization rates increase significantly.  
With approximately 40% of its assets located in Canada, LP's
margins are further challenged by the strong Canadian dollar.  
Although LP is taking measures to preserve cash, the ongoing cash
needs to fund its operations continue to deplete the company's
liquidity.

Credit positives include the positive long term industry
fundamentals as OSB continues to take market share from plywood
due to its relative cost advantage.  LP is the largest OSB
producer in North America and generates substantial free cash flow
in strong OSB pricing environments.  LP maintains a strong balance
sheet and has committed to maintain at least $250 million in cash.

The SGL-2 liquidity rating indicates anticipated good liquidity
over the next 12 months given the company's strong cash balances
that should cover the company's anticipated operating needs.

The negative outlook reflects the potential for further downward
ratings adjustment should the weakness in the OSB market prevail
for a longer period of time and cause a material deterioration in
liquidity arrangements.  Industry-wide operating conditions
indicate that cash flow may not improve and LP will continue to
fund its negative cash flow from its cash and investments.

Downgrades:

Issuer: Louisiana-Pacific Corporation

  -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ba2
     from Baa3

  -- Senior Unsecured Shelf, Downgraded to (P)Ba2 from (P)Baa3

Assignments:

Issuer: Louisiana-Pacific Corporation

  -- Speculative Grade Liquidity Rating, Assigned SGL-2

Reinstatements:

Issuer: Louisiana-Pacific Corporation

  -- Corporate Family Rating, Reinstated to Ba2

Outlook Actions:

Issuer: Louisiana-Pacific Corporation

  -- Outlook, Changed To Negative From Rating Under Review

Moody's last rating action on LP was on Feb. 13, 2008 when the
Baa3 senior unsecured debt ratings were placed under review for
possible downgrade.

Headquartered in Nashville, Tennessee, Louisiana-Pacific
Corporation is a leading manufacturer and distributor of wood
based building materials, and is North America's largest producer
of oriented strandboard.  The company has approximately 24% and
15% market share for OSB and structural panels respectively.


MASTR ASSET: Class M-9 and Class M-10 Gets S&P's Rating Downgrades
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class M-9 and M-10 mortgage pass-through certificates from MASTR
Asset Backed Securities Trust 2005-NC1.
     
The downgrades of these classes reflect continuous adverse pool
performance.  As of the January 2008 remittance period, cumulative
losses were $8.92 million, or 0.91% of the original pool balance.   
Serious delinquencies (90-plus days, foreclosures, and REOs) were  
$51.36 million of the current pool balance, up $4.5 million from
12 months ago.
     
The underlying collateral for this transaction originally
consisted of subprime fixed- and adjustable-rate first and second
liens on owner-occupied one- to four-family residential
properties.

                         Ratings Lowered

          MASTR Asset Backed Securities Trust 2005-NC1
                Mortgage pass-through certificates

                                   Rating
                                   ------
                    Class       To       From
                    -----       --       ----
                    M-9         BB       BBB-
                    M-10        B        BBB-


MCCALL CITY: Council Passes Resolution Allowing Bankruptcy Filing
-----------------------------------------------------------------
The McCall City Council on Monday authorized city attorneys to
file for Chapter 9 municipal bankruptcy, Lora Volkert of Idaho
Business News reports.

As reported by the Troubled Company Reporter on Feb. 26, 2008, a
bankruptcy filing will allow it to postpone paying $6 million to
St. Clair Contractors, a wastewater treatment facility contractor
and Employers Insurance of Wausau, which provided the contractor's
performance bond.

McCall had claimed that the contractor didn't do the agreed work
properly.  The contractor demanded payment of $6.5 million.  Since
May of last year, the city has paid back $1 million of that debt,
according to KTVB.com of Idaho.  Wasau is now asking a judge to
force the city to pay all the debt back immediately.  They want to
prohibit McCall from making any payments to anyone until that
judgment is satisfied, according to the report.

Meanwhile, the city has applied for judicial confirmation.  A
judicial confirmation hearing to determine whether McCall is
authorized by state law to issue bonds for the $6 million legal
judgment without holding an election was held Wednesday.

On Wednesday, a judge indicated he's inclined to grant the city
permission to sell revenue bonds without getting voter approval,
according to Alyson Outen of KTVB (Idaho).

McCall is a city in Valley County, Idaho.


MEDICOR LTD: Court Approves $7 Million DIP Financing
----------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
approved MediCor Ltd. and its debtor-affiliates' request seeking
to further increase their debtor-in-possession financing to
$7 million, Bloomberg New Reports.

According to Bloomberg, the Court also extended the loan maturity
date of the financing until April 15, 2008.

As reported in the Troubled Company Reporter on Dec. 14, 2007,
the Debtors asked the Court to increase their DIP financing from
$2.2 million to $5 million

The Debtors said that they need a larger loan to pay bills that
prompted them to seek the additional funds.

                          About MediCor

Headquartered in North Las Vegas, Nevada, MediCor Ltd. --
http://www.medicorltd.com/-- manufactures and markets products    
primarily for aesthetic, plastic and reconstructive surgery and
dermatology markets.  The company and seven of its affiliates
filed for chapter 11 protection on June 29, 2007 (Bankr. D. Del.
Case No. 07-10877) to effectuate the orderly marketing and sale of
their business.  Kenneth A. Rosen, Esq., Jeffrey D. Prol, Esq.,
and Jeffrey A. Kramer, Esq., at Lowenstein Sandler PC represent
the Debtors in their restructuring efforts.  Dennis A. Meloro,
Esq., and Victoria Watson Counihan, Esq., at Greenberg Traurig,
LLP, acts as the Debtors' Delaware counsel.  The Debtors engaged
Alvarez & Marsal North America LLC as their restructuring advisor.  
David W. Carickhoff, Jr., Esq., and Jason W. Staib, Esq., at Blank
Rome LLP serve as the Official Committee of Unsecured Creditor's
counsel.  In its schedules of assets and debts filed with the
Court, Medicor disclosed total assets of $96,553,019, and total
debts of $158,137,507.


MEDICOR LTD: Wants Until May 26 to File Chapter 11 Plan
-------------------------------------------------------
MediCor Ltd. and its debtor-affiliates ask the United States
Bankruptcy Court for the District of Delaware to further extend
the exclusive periods to:

   a) file a Chapter 11 plan until May 26, 2008; and

   b) solicit acceptances of that plan until July 24, 2008.

The Debtors need substantial amount of time to complete the
sale of all their assets, including the assets of their European
affiliates -- Eurosilicone SAS; Biosil Ltd.; and Nagor Ltd.

As previously reported, the Debtors asked the Court to approve
the bidding procedure for the sale of their assets.  To date,
the Debtors have not received any qualified bids.  However, an
interested purchaser has resurfaced and wants to continue talks
to purchase all the Debtors' European assets.

The Debtors say that they expect that a sale agreement will be
completed shortly and an appropriate request for approval will be
filed before the Court.

The move to further extend the Debtors' exclusive rights will
enable them to formulate a confirmable plan, according to the
Debtors.

The Debtors assure the Court that the request will not harm their
creditors or other parties in interest in these cases.

The Debtors' exclusive period to file a Chapter 11 plan expired on
Feb. 25, 2008.

A hearing has been set on March 17, 2008, at 10:30 a.m., whether
to approve the Debtors' request.  Objections, if any, must be
filed on or before March 10, 2008.

                          About MediCor

Headquartered in North Las Vegas, Nevada, MediCor Ltd. --
http://www.medicorltd.com/-- manufactures and markets products     
primarily for aesthetic, plastic and reconstructive surgery and
dermatology markets.  The company and seven of its affiliates
filed for chapter 11 protection on June 29, 2007 (Bankr. D. Del.
Case No. 07-10877) to effectuate the orderly marketing and sale of
their business.  Kenneth A. Rosen, Esq., Jeffrey D. Prol, Esq.,
and Jeffrey A. Kramer, Esq., at Lowenstein Sandler PC represent
the Debtors in their restructuring efforts.  Dennis A. Meloro,
Esq., and Victoria Watson Counihan, Esq., at Greenberg Traurig,
LLP, acts as the Debtors' Delaware counsel.  The Debtors engaged
Alvarez & Marsal North America LLC as their restructuring advisor.  
David W. Carickhoff, Jr., Esq., and Jason W. Staib, Esq., at Blank
Rome LLP serve as the Official Committee of Unsecured Creditor's
counsel.  In its schedules of assets and debts filed with the
Court, Medicor disclosed total assets of $96,553,019, and total
debts of $158,137,507.


MIIX INSURANCE: Court Wants Creditors to Appear at April 9 Hearing
------------------------------------------------------------------
The Honorable Neil H. Shuster of the Superior Court of New Jersey,
Chancery Division-Mercer County advised that any person or entity
having an interest in or claim against MIIX Insurance Company
appear before the Court on April 9, 2008, at 2:00 p.m., 210 Broad
Street, 5th Floor, in Trenton, New Jersey.

In 2004, Judge Shuster appointed Holly C. Bakke, Commissioner of
Banking and Insurance for the State of New Jersey, as the
Rehabilitator for MIIX Insurance Company.  At the same time, all
directors and officers of MIIX Insurance and of its two
subsidiaries, Lawrenceville Holdings, Inc. and MIIX Insurance
Company of New York, resigned from their positions.

Claimants are compelled, during the appearance, to show cause why
the Court should not:

   a) appoint the Commissioner as liquidator of MIIX;

   b) direct the Commissioner to liquidate MIIX;

   c) terminate the order of rehabilitation of MIIX entered on
      Sept. 28, 2004;

   d) permanently enjoin all persons and entities from pursuing
      litigation against MIIX, or from interfering with the
      Commissioner's efforts to liquidate MIIX;

   e) halt all further payments of claims by MIIX;

   f) provide that all claims must be asserted against MIIX no
      later than one year from the date of the liquidation order,
      in the form established by the Commissioner;

   g) establish procedures governing the payment of claims by
      MIIX; and

   h) grant the Commissioner other injunctive and equitable relief
      as may be necessary to protect the policyholders and
      creditors of MIIX and the public.

The Court also declared MIIX to be insolvent.  The Court also
stayed all court actions, arbitrations and mediations in which
MIIX is a party of.

If any interested party intends to file answering affidavits,
briefs, or seek other kind of relief concerning the matter, the
appropriate papers should be filed on March 20, 2008, with:

      Emerald Erickson Kuepper, Esq.
      Senior Deputy Attorney General
      Counsel for the Commissioner
      22 South Clinton Avenue
      Building 4, 2nd Floor
      P.O. Box 117
      Trenton, NJ 08628-0117
  
Based in Lawrenceville, New Jersey, MIIX Insurance Company --
http://www.miix.com/-- is a subsidiary of The MIIX Group,
Incorporated (OTC: MIIX).  The group provides management and
claims administrative services to the medical professional
liability insurance industry, and a range of consulting products
to physician and healthcare providers.  The MIIX Group of
Companies currently protects existing physician, medical
professional, and institutional insureds through its long-
term commitment to run-off insurance operations.


MILACRON INC: Dec. 31 Balance Sheet Upside-Down by $51.1 Million
----------------------------------------------------------------
Milacron Inc. released its results for the fourth quarter ended
Dec. 31, 2007.  The company's balance sheet showed total assets of
$ 592.9 million and total liabilities of $644 million, resulting
in a $51.1 million stockholders' deficit.  Deficit, at Dec. 31,
2006, was $21.3 million.

The company reported a net loss in the fourth quarter of 2007 of
$73.4 million, caused primarily by a non-cash writedown of
deferred tax assets of $63.0 million associated with the change of
ownership of the majority of the company's preferred stock, as
announced in October.  The loss also included $7.4 million in
restructuring charges, $1.9 million in one-time costs related to
the curtailment of the company's U.S. pension plan, as well as
$1.4 million in expenses related to the preferred stock
transaction.  This compared to a net loss in the fourth quarter of
2006 of $8.6 million, which included $5.1 million in restructuring
costs and $1.8 million in refinancing charges.

"We continue to make solid progress throughout the company in
terms of our restructuring and other cost reduction initiatives,"
Ronald D. Brown, chairman, president and chief executive officer,
said.  "Our manufacturing margins and operating cash flow or
EBITDA are both up significantly from the year-ago quarter.  And
our efforts to expand Milacron's presence in faster-growing
markets of the world are also paying off.  In fact, our sales to
markets outside the U.S., Canada and Western Europe are up well in
excess of 20% and now represent about 25% of our total sales."

These gains in non-traditional markets helped offset declines in
North America, as fourth quarter 2007 sales reached $217 million,
up 10% from $198 million in the year-ago quarter.  About half of
the sales increase came as a result of favorable currency
translation effects.  New orders in the quarter were $213 million,
up from $203 million in 2006, entirely due to currency
translation.

Aided by favorable resolutions of long-standing product liability
claims and the benefits of restructuring and product cost
reduction initiatives, manufacturing margins in the quarter rose
to 22.3%, up from 19.4% in the year ago quarter.

Net cash provided by operations during the quarter was
$9.6 million, compared to a use of cash by operations of $800,000
in the fourth quarter of 2006.  At the end of the quarter,
Milacron had $41 million in cash, up $3 million from the beginning
of the quarter.  The company also had $34 million in borrowing
availability under its North American revolving credit agreement,
down from $42 million at the beginning of the quarter.

                           Year 2007

Milacron's net loss for the year was $88.8 million, or $19.59 per
share.  This included the writedown of tax assets of
$63.0 million, restructuring charges of $12.5 million,
$1.9 million in one-time costs for pension plan curtailment,
as well as $1.9 million in expenses for the preferred stock
transaction.  In 2006, Milacron lost $39.7 million, or $10.15 per
share, which included $17.4 million in restructuring costs and
$1.8 million in refinancing charges.  Operating earnings in 2007
improved to $3.1 million, up from a loss of $7.2 million in 2006.  
Sales in 2007 fell to $808 million from $820 million in 2006,
while new orders were $826 million, down slightly from
$828 million in the prior year. 2007 sales and new orders were
helped by approximately $29 million in favorable currency
translation effects.

Throughout 2007, Milacron faced severe declines in two of its
largest markets in North America: injection molding machinery and
mold technologies, which have been impacted by the shakeout in
U.S. auto parts suppliers and the decline in new housing starts.  
During the year, however, restructuring measures helped reduce
overall operating expenses by $12 million, while global redesign
and sourcing initiatives cut product costs by $6 million.  To
further soften the impact of the downturn in capital spending in
North America, Milacron focused on growing aftermarket sales,
which approached $200 million and grew to represent 36% of total
machinery sales.  The company also accelerated efforts to further
penetrate markets outside the U.S., Canada and Western Europe.  As
a result, sales to these non-traditional markets rose to $187
million in 2007, up 27% over 2006.

Continued cost reductions and efficiency improvements helped raise
manufacturing margins in 2007 to 20.2%, a significant increase
over 18.5% in 2006.

Net cash provided by operations for the year was $9.6 million,
compared to a use of cash by operations of $19.2 million in 2006.

                          Outlook

"The economic outlook for 2008 is mixed," Mr. Brown said.  "We
expect to see continued growth in most of our markets outside of
North America, particularly in China, India and other faster-
growing economies.  Due to uncertainty in the automotive and
housing sectors, however, we are not anticipating any market
growth in North America.

"We entered the year with a solid backlog for the first quarter.  
This should enable us to show significant year-over-year
improvement in sales and operating results compared to the first
quarter of 2007.

"We continue to work hard to make 2008 a significantly better year
for Milacron," Mr. Brown said.  "In addition to improved operating
results from restructuring efforts, our cash flow will benefit
from the U.S. pension plan freeze we implemented at the end of
last year, from lower insurance costs going forward and from the
ongoing sale of redundant or non-core assets.  We are also in the
process of negotiating an asset-based loan in Europe, which will
increase our overall liquidity."

                      Annual Meeting Date Set

Milacron's board of directors set May 8, 2008 as the date of the
annual meeting of shareholders to be held in Cincinnati, Ohio, and
March 12, 2008 as the record date for determination of
shareholders entitled to notice of and to vote at the annual
meeting.

                          About Milacron

Headquartered in Cincinnati, Ohio, Milacron Inc. --
http://www.milacron.com/-- supplies plastics-processing  
technologies and industrial fluids, with major manufacturing
facilities in North America, Europe and Asia.   First incorporated
in 1884, Milacron is also manufactures synthetic water-based
industrial fluids used in metalworking applications.  

                           *     *     *

As reported in the Troubled Company Reporter on Dec. 26, 2007,
Moody's Investors Service lowered the ratings of Milacron Inc.
Corporate Family, to Caa2 from Caa1; Probability of Default, to
Caa2 from Caa1; and senior secured notes, to Caa2 from Caa1. The
lowered ratings reflect the company's weak credit metrics and
ongoing cash flow pressures.


MORGAN STANLEY: Fitch Holds Junk Rating on $5.3MM Class M Certs.
----------------------------------------------------------------
Fitch Ratings has affirmed Morgan Stanley Capital I Inc.'s
commercial pass-through certificates, series 1998-WF2 as:

  -- Interest only class X at 'AAA';
  -- $33.9 million class B at 'AAA';
  -- $47.8 million class C at 'AAA';
  -- $53.1 million class D at 'AAA';
  -- $21.2 million class E at 'AAA';
  -- $21.2 million class F at 'AAA';
  -- $23.9 million class G at 'A+';
  -- $10.6 million class H at 'BBB+';
  -- $8 million class J at 'BBB';
  -- $8 million class K at 'BB+';
  -- $15.9 million class L at 'B-';
  -- $5.3 million class M at 'CCC/DR1'.

Fitch does not rate the $2.5 million class N.  The class A-1 and
A-2 certificates have been paid in full.  Although credit
enhancement has increased due to scheduled amortization and loan
payoffs since Fitch's prior ratings action, affirmations are
warranted because of adverse selection and an increase in expected
losses.  As of the February 2008 distribution date, the pool's
aggregate balance has been reduced 76.3%, to $251.4 million from
$1.06 billion at issuance.

Fitch has identified twelve Loans of Concern (11.9%), including
one real-estate owned asset in special servicing (0.8%) with
losses expected.  The loan is secured by a retail property located
in Lansing, Michigan and remains 100% vacant since 2002.  Recent
valuations of the asset indicate losses upon liquidation.

The largest Loan of Concern (2.9%) is secured by an industrial
warehouse facility in Lodi, California.  Occupancy as of September
2007 was 61%.  The loan is scheduled to mature in March 2008.

The second largest Loan of Concern (1.8%) is secured by an office
property in Charleston, West Virginia and is current.  Occupancy
as of June 2007 was 82%.  The loan maturity has been extended
until April 2008.

The largest remaining loan (16.9%) is an office property located
in Washington, D.C.  The fully amortizing loan is scheduled to
mature in 2023 and had a year-end 2006 debt service coverage ratio
of 1.51 times.

The second largest remaining loan (10.2%) is secured by a retail
property in Los Angeles, California.  The loan is scheduled to
mature in May 2008 and had a YE 2006 DSCR of 1.48x.

Fitch continues to monitor upcoming maturities, with 44.8% of the
pool scheduled to mature in 2008, of which 1.5% is defeased.  
These loans have a weighted average coupon of 7.10%.


MORGAN STANLEY: Moody's Pares Ratings on 47 Tranches From 14 Deals
------------------------------------------------------------------
Moody's Investors Service has downgraded 47 tranches from 14
Morgan Stanley transactions.  Moody's also placed twelve tranches
from these transactions on review for possible downgrade.   The
collateral backing these transactions consists primarily of fixed-
rate and adjustable rate first lien subprime mortgage loans.

These rating actions are based on a comparison of the bonds'
credit enhancement, including excess spread, relative to the
current projected loss numbers.  The overwhelming majority of
these transactions have pool factors of less than 10% and the
average note factor of certificates being downgraded to impairment
ratings is approximately 17%.  The actions are the result of
volatility due to tail end risks even though the overall
collateral performance is in the area of initial expectations.

The complete rating actions are:

Morgan Stanley ABS Capital I Inc. 2002-NC6

  -- Cl. M-1 Currently Aa2, on review for possible downgrade,
  -- Cl. M-2, Downgraded to Ba2, previously A2,
  -- Cl. B-1, Downgraded to Ca, previously Ba2,
  -- Cl. B-2, Downgraded to C, previously B2,

Morgan Stanley ABS Capital I Inc. Mortgage Loan Asset-Backed
Certificates, Series 2001-WF1

  -- Cl. M-1 Currently Aa2, on review for possible downgrade,
  -- Cl. M-2, Downgraded to B2, previously A2,
  -- Cl. B-1, Downgraded to Ca, previously Baa3,

Morgan Stanley ABS Capital I Inc. Trust 2003-HE1

  -- Cl. M-3, Downgraded to Baa2, previously A3,
  -- Cl. B-1, Downgraded to Baa3, previously Baa1,
  -- Cl. B-2, Downgraded to Ba3, previously Baa2,
  -- Cl. B-3, Downgraded to Caa3, previously Baa3,

Morgan Stanley ABS Capital I Inc. Trust 2003-HE3

  -- Cl. B-2, Downgraded to Ba3, previously Baa2,
  -- Cl. B-3, Downgraded to Caa3, previously Baa3,

Morgan Stanley ABS Capital I Inc. Trust 2003-NC6

  -- Cl. M-2 Currently Aa3, on review for possible downgrade,
  -- Cl. M-3, Downgraded to Baa3, previously A3,
  -- Cl. B-1, Downgraded to Ba3, previously Baa1,
  -- Cl. B-2, Downgraded to Caa3, previously Ba2,
  -- Cl. B-3, Downgraded to Ca, previously B3,

Morgan Stanley ABS Capital I Inc. Trust 2004-NC2

  -- Cl. M-3, Downgraded to Baa2, previously A3,
  -- Cl. B-1, Downgraded to Ba1, previously Baa1,
  -- Cl. B-2, Downgraded to B2, previously Baa2,
  -- Cl. B-3, Downgraded to Ca, previously Ba1,
  -- Cl. B-4, Downgraded to Ca, previously Ba3,

Morgan Stanley ABS Capital I Inc. Trust 2005-WMC1

  -- Cl. M-2 Currently Aa2, on review for possible downgrade,
  -- Cl. M-3 Currently Aa3, on review for possible downgrade,
  -- Cl. M-4, Downgraded to Baa2, previously A1,
  -- Cl. M-5, Downgraded to Baa3, previously A2,
  -- Cl. M-6, Downgraded to Ba3, previously A3,
  -- Cl. B-1, Downgraded to B2, previously Baa1,
  -- Cl. B-2, Downgraded to Caa3, previously Baa2,
  -- Cl. B-3, Downgraded to Ca, previously Baa3,

Morgan Stanley Capital I Inc. Trust 2003-NC4

  -- Cl. M-1 Currently Aaa, on review for possible downgrade,
  -- Cl. M-2 Currently Aa2, on review for possible downgrade,
  -- Cl. M-3, Downgraded to Baa2, previously A1,
  -- Cl. B-1, Downgraded to Ba3, previously Baa1,
  -- Cl. B-2, Downgraded to Caa3, previously Ba2,
  -- Cl. B-3, Downgraded to C, previously B3,

Morgan Stanley Dean Witter Capital I Inc. Mortgage Pass-Through
Certificates, Series 2001-NC3

  -- Cl. M-2, Downgraded to Baa1, previously A2,
  -- Cl. B-1, Downgraded to Caa2, previously Ba1,

Morgan Stanley Dean Witter Capital I Inc. Trust 2002-HE1

  -- Cl. M-1 Currently Aa2, on review for possible downgrade,
  -- Cl. M-2, Downgraded to Ba1, previously A2,
  -- Cl. B-1, Downgraded to Caa2, previously Baa2,
  -- Cl. B-2, Downgraded to C, previously Ba1,

Morgan Stanley Dean Witter Capital I Inc. Trust 2002-HE2

  -- Cl. M-2, Downgraded to Baa2, previously A2,
  -- Cl. B-1, Downgraded to Caa2, previously B1,
  -- Cl. B-2, Downgraded to C, previously Caa1,

Morgan Stanley Dean Witter Capital I Inc. Trust 2002-NC4

  -- Cl. M-1 Currently Aaa, on review for possible downgrade,
  -- Cl. M-2, Downgraded to Ba1, previously A3,
  -- Cl. B-1, Downgraded to Caa3, previously B3,
  -- Cl. B-2, Downgraded to C, previously Ca,

Morgan Stanley Dean Witter Capital I Inc. Trust 2003-NC1

  -- Cl. M-2 Currently Aa3, on review for possible downgrade,
  -- Cl. M-3, Downgraded to Baa3, previously A3,
  -- Cl. B-1, Downgraded to Caa2, previously Ba3,
  -- Cl. B-2, Downgraded to C, previously B3,

Morgan Stanley Dean Witter Capital I Inc. Trust 2003-NC2

  -- Cl. M-1 Currently Aaa, on review for possible downgrade,
  -- Cl. M-2 Currently Aa2, on review for possible downgrade,
  -- Cl. M-3, Downgraded to Baa3, previously A3,
  -- Cl. B-1, Downgraded to Caa2, previously Ba1,
  -- Cl. B-2, Downgraded to Ca, previously Ba3.


MSGI SECURITY: Dec. 31 Balance Sheet Upside-Down by $4,245
----------------------------------------------------------
MSGI Security Solutions Inc.'s consolidated balance sheet at
Dec. 31, 2007, showed $7,854,332 in total assets, and $7,858,577
in total liabilities, resulting in a $4,245 total stockholders'
deficit.

At Dec. 31, 2007, the company's consolidated balance sheet also
showed strained liquidity with $6,726,000 in total current assets
available to pay $7,258,564 in total current liabilities.

MSGI Security Solutions Inc. reported a net loss of $9,628,708 on
$-0- revenues for the second quarter ended Dec. 31, 2007, compared
with a net loss of $1,268,9156 on total revenue of $77,895 for the
same period ended Dec. 31, 2006.  The net loss for the December
2007 quarter includes non-cash interest charges of approximately
$8.2 million.

The company received orders for approximately $4,865,000 in the
December quarter and prepaid $2,500,000 to its suppliers for the
required inventory; however components did not begin to arrive
until Jan. 3, 2008, effectively pushing the December business into
January, the third quarter.  As a result of these unanticipated
delays by its supplier, the company was unable to report any
revenue for the December quarter.

For the three months ended Dec. 31, 2007, loss from operations was
$1,105,479 as compared to loss from operations of $835,289 for the
same quarter in 2006.  The $270,190 increase in loss of operations
was directly related to a one-time transaction related increase in
certain professional fees.

As previously disclosed, the Callable Secured Convertible 8% Notes
originally issued July 2005 to September 2005 and the Callable
Secured 6% Notes originally issued on Dec. 13, 2006, were
converted into shares of common stock, which were immediately
purchased by certain institutional investors on Oct. 3, 2007, from
the original note holders.  The transaction did not result in any
proceeds to MSGI.  The institutional investors fully converted all
such Notes into approximately 7.7 million shares of the company's
stock, which eliminated approximately $3.5 million of debt.

Conversion of the debt resulted in significant non-cash charges to
the company.  The non-cash interest expenses from acceleration of
the accretion of the debt discounts as well as certain additional
beneficial conversion adjustments upon conversion of the former
Notes plus additional debt discounts derived from anti-dilution
provisions which were triggered by the conversions resulted in
significant non-cash interest charges to the company of
approximately $8.9 million for the six months ended Dec. 31,
2007,and $8.2 million for the three months ended Dec. 31, 2007.

Cash and equivalents as of Dec. 31, 2007, were $301,440.  Accounts
receivable totaled $3,916,560.  Subsequent to the quarter the
company received payment of $3.8 million of the accounts
receivable representing full payment from Apro Media related
business.

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?2890

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on Oct. 18, 2007,
Amper, Politziner & Mattia, P.C., in Edison, N.J., expressed
substantial doubt about MSGI Security Solutions Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the year ended June 30,
2007.  The auditing frim stated that the company has suffered
recurring losses and negative cash flows from operations.

                       About MSGI Security
  
MSGI Security Solutions Inc. (Other OTC: MSGI) --
http://www.msgisecurity.com/-- provides of proprietary security   
products and services to commercial and governmental organizations
worldwide.  MSGI is developing a combination of innovative
emerging businesses that leverage information and technology with
a focus on encryption technologies for actionable surveillance and
intelligence monitoring.  The company is headquartered in New York
City where it serves the needs of counter-terrorism, public
safety, and law enforcement in the United States, Europe, the
Middle East and Asia.


NATIONWIDE HEALTH: Fitch Affirms 'BB+' Rating on Preferred Stock
----------------------------------------------------------------
Fitch Ratings has affirmed the existing ratings for Nationwide
Health Properties as:

  -- Issuer Default Rating at 'BBB-';
  -- Unsecured bank credit facility at 'BBB-';
  -- Senior unsecured notes at 'BBB-';
  -- Preferred stock at 'BB+'.

The Rating Outlook has been revised to Positive from Stable.

The rating action affects approximately $1.3 billion of
outstanding securities.

The Positive Outlook follows NHP's announcement that it has signed
definitive agreements with Pacific Medical Buildings to acquire
$915 million of medical office buildings, a 50% interest in a full
service property management service provider, and an exclusive
right to acquire up to $1 billion of additional medical office
assets to be developed by PMB in the future.

Fitch notes that the acquisition is expected to grow NHP's
existing asset base by approximately 25% over the next three
years, increase its exposure to medical office buildings, and
decrease its reliance on revenue from its top senior housing and
long term care operators.  The medical office buildings to be
purchased through 2010 are high quality and well-leased at 95.2%
as of Dec. 31, 2007.

One of Fitch's key credit concerns relating to NHP has been the
operator concentration inherent within the portfolio.  NHP's top
five operators represented 46% of its total cash rents in the
fourth quarter of 2007.  By the end of 2008, these operators are
projected to represent approximately 33% of total cash rents.

As of Dec. 31, 2007, 84% of the company's investments were subject
to master leases.  Additionally, the majority of NHP's leases
contain cross-collateralization and cross-default provisions.  
This minimizes adverse selection risk on weaker facilities in the
portfolio.

Fitch notes that NHP intends to maintain debt service coverage
ratios and leverage within existing ranges after the acquisitions
are closed.  Interest coverage, as defined by recurring EBITDA to
total interest expense was 2.9 times in 2007, compared to 2.7x in
2006, and 3.0x in 2005.  Fixed charge coverage, as defined by
recurring EBITDA less capitalized expenditures to total interest
plus preferred dividends, was 2.6x in 2007, 2.3x in 2006, and 2.5x
in 2005.  NHP's total debt to undepreciated book capital was 44.9%
and total debt plus preferred securities to total undepreciated
book capital was 48% at Dec. 31, 2007.

In addition to the company's solid credit metrics, an important
contributor to NHP's existing ratings is the company's financial
flexibility, which is particularly critical given the current
volatility in the capital markets.  NHP has maintained a sizable
unencumbered asset pool, which included 392 assets with a gross
book value of approximately $2.9 billion at Dec. 31, 2007.  Fitch
calculates NHP's unencumbered asset coverage of unsecured debt to
be 1.8x, which is appropriate for the rating category.  
Additionally, NHP has limited debt maturities over the next
several years, limiting refinancing risk.

Fitch notes that the successful integration of the PMB platform
into NHP is critical to the success of the announced transaction,
due to NHP's limited expertise with respect to managing medical
office buildings.  PMB Real Estate Services, the property
management firm in which NHP is acquiring a 50% interest, has been
managing medical office facilities for 35 years.  Fitch would
expect to see evidence of a smooth integration between PMB and NHP
over the next 12 to 24 months in conjunction with the resolution
of the Positive Outlook.

Based in Newport Beach, California, Nationwide Health Properties
is a self-managed and self-administered real estate investment
trust that invests in senior housing facilities, long-term care
facilities, and medical office buildings.  As of Dec. 31, 2007,
the company had investments in 560 health care facilities in 43
states.


NEUMANN HOMES: Court Extends Exclusive Plan Filing Periods
----------------------------------------------------------
The United States Bankruptcy Court for the Northern District of
Illinois extended Neumann Homes Inc. and its debtor-affiliates'
exclusive periods to (i) file a Chapter 11 plan until July 31,
2008 and (ii) solicit acceptances of that plan Oct. 31, 2008.

As reported in the Troubled Company Reporter on Feb. 14, 2008,
the Debtors' Plan Filing Deadline is set to expire Feb. 29,  
while their Solicitation Period is due April 29.

George N. Panagakis, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, said the request is appropriate
since the Debtors met the requirements for a valid extension.

"The Debtors' bankruptcy cases were relatively large in terms
of overall value and scope of their assets, and are extremely
complex due to the current economic conditions, the number of
senior secured creditors, among others," Mr. Panagakis says.

Mr. Panagakis asserted that an extension of the Exclusive Periods
is also justified by the Debtor's progress in resolving issues
facing its creditors and estates.

The Debtors have dealt with most of the homes that were under
construction as of the Petition Date as well as most of the
secured claims related to the developed properties, Mr. Panagakis
states.  He says that the transfer of the developed properties is
also nearly complete, adding that this would help increase in
scope and space the resolution of trade claims to the developed
properties.

Mr. Panagakis further relates that the Debtors have also sold and
liquidated unnecessary assets, reduced the administrative burdens
upon their estates by rejecting numerous burdensome contracts and
leases, among others.

With respect to their remaining real property, the Debtors, in
consultation with their special real estate consultant, Hilco
Real Estate, LLC, have prepared valuations of and developed
strategies to sell or otherwise dispose of the Developed Property
that are designed to maximize and create value for the Debtors
creditors, Mr. Panagakis says.  He added that the Debtors have
been in negotiations with each of their prepetition secured
lenders and expect to seek Court authority to implement sales and
marketing processes on a lender-by-lender basis in the coming
days and weeks to execute their strategies and, thus, create a
path for the remainder of the Debtors' cases.

The Debtors anticipated that they will be in a better position to
file a Plan upon the completion of those processes and, thus,
require additional time to implement their strategies and
formulate a Plan.

"The extensions requested will not prejudice the legitimate
interests of any party-in-interest in these Chapter 11 Cases,"
Mr. Panagakis points out, adding that the request is not  a
negotiation tactic but merely shows that the cases are not yet
ripe for the formulation and confirmation of a viable Plan.

Headquartered in Warrenville, Illinois, Neumann Homes Inc. --
http://www.neumannhomes.com/-- develops and builds residential
real estate throughout the Midwest and West US.  The company is
active in the Chicago area, southeastern Wisconsin, Colorado, and
Michigan.  The company have built more than 11,000 homes in some
150 residential communities.  The company offer formal business
training to employees through classes, seminars, and computer-
based training.

The company filed for Chapter 11 protection on Nov. 1, 2007
(Bankr. N.D. Ill. Case No. 07-20412).  George Panagakis, Esq., at
Skadded, Arps, Slate, Meagher & Flom L.L.P., was selected by the
Debtors to represent them in these cases.  The Official Committee
of Unsecured Creditors has selected Paul, Hastings, Janofsky &
Walker LLP, as its counsel in these bankruptcy proceeding.  When
the Debtors filed for protection against its creditors, they
listed assets and debts of more than $100 million.

(Neumann Bankruptcy News, Issue No. 12; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000)   


NEW CENTURY: Moody's Cuts Ratings on Five Tranches From Two Deals
-----------------------------------------------------------------
Moody's Investors Service downgraded five tranches from two New
Century transactions.  Moody's also placed one tranche from these
transactions on review for possible downgrade.  The collateral
backing these transactions consists primarily of fixed-rate and
adjustable rate first lien subprime mortgage loans.

These rating actions are based on a comparison of the bonds'
credit enhancement, including excess spread, relative to the
current projected loss numbers.  Both these transactions have pool
factors of less than 10% and the average note factor of
certificates being downgraded to impairment ratings is
approximately 20%.  The actions are the result of volatility due
to tail end risks even though the overall collateral performance
is in the area of initial expectations.

The complete rating actions are:

New Century Home Equity Loan Trust, Series 2003-2

  -- Cl. M-2 Currently Aa3, on review for possible downgrade,
  -- Cl. M-3, Downgraded to Caa1, previously Ba2,
  -- Cl. M-4, Downgraded to C, previously B2,

New Century Home Equity Loan Trust, Series 2003-6

  -- Cl. M-4, Downgraded to Baa3, previously Baa1,
  -- Cl. M-5, Downgraded to Ba3, previously Baa2,
  -- Cl. M-6, Downgraded to Caa1, previously Baa3,


NORTEL NETWORKS: Posts $844 Mil. Net Loss in Fourth Quarter 2007
----------------------------------------------------------------
Nortel Networks Corp. reported financial and operating results for
the fourth quarter and full year of 2007.

The Company reported a net loss in the fourth quarter of 2007 of
$844 million, compared to net loss of $80 million in the fourth
quarter of 2006 and net income of $27 million in the third quarter
of 2007.   Nortel reported a net loss for 2007 of $957 million,
compared to net earnings of $28 million for the year 2006.

Revenue was $3.2 billion for the fourth quarter of 2007 compared
to $3.3 billion for the fourth quarter of 2006 and $2.7 billion
for the third quarter of 2007.  In the fourth quarter of 2007,
revenue increased by 18% compared to the third quarter of 2007 and
excluding the impact of the UMTS Access divestiture, revenue
increased by 2% compared with the year-ago quarter.  For 2007,
revenues were $10.95 billion compared to $11.4 billion for 2006.

"Nortel continued to make strong progress in the fourth quarter as
we completed a pivotal year in our transformation," Nortel
President and CEO Mike Zafirovski said.  "In a period of
significant change for our industry, we have now reported six
consecutive quarters of strong year over year improvement in
operating margin, reflected in a 353 basis points improvement in
the second half of 2006 and a 369 basis points improvement in
2007.  Although our fourth quarter operating margin was below our
target, it is the highest in 12 quarters.  We also recorded a 386
basis point increase in gross margin to 43.7%, also the highest in
12 quarters.  And most importantly, customers around the world are
validating our strategic direction by signing up for multi-year
engagements that leverage both our technological innovation and
world-class know-how.  We ended the year with a positive book to
bill of 1.01 in the fourth quarter."

Gross margin was 43.7% of revenue in the fourth quarter of 2007.
This compared to gross margin of 39.8% for the fourth quarter of
2006 and 43.0% for the third quarter of 2007.  Compared to the
fourth quarter of 2006, gross margins benefited primarily from
productivity improvements and mix.

Cash balance at the end of the fourth quarter of 2007 was
$3.5 billion, up from $3.13 billion at the end of the third
quarter of 2007.  The increase in cash was primarily driven by
cash from operating activities of $417 million and a positive
impact from foreign exchange of $16 million, partially offset by
cash used in financing activities of $23 million and cash used in
investing activities of $6 million.

                              Outlook

Nortel provided its financial outlook for the full year 2008, and
expects:

   * Revenue to grow in the low single digits compared to 2007;

   * Gross Margin to be about our business model target of 43% of  
     revenue;

   * Operating Margin as a percentage of revenue to increase by
     about 300 basis points compared to 2007.

At Dec. 31, 2007, the company's balance sheet showed total assets
of $17.0 billion and total liabilities of $13.4 billion, resulting
in a $2.7 billion, stockholders' equity.  Equity, on Sept. 30,
2007, was $2.9 billion and, on Dec. 31, 2006, was $1.1 billion.

                     About Nortel Networks

Headquartered in Ontario, Canada, Nortel Networks Corporation
(NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next-
generation technologies, for both service provider and enterprise
networks, support multimedia and business-critical applications.
Nortel's technologies are designed to help eliminate today's
barriers to efficiency, speed and performance by simplifying
networks and connecting people to the information they need, when
they need it.  Nortel does business in more than 150 countries
around the world.  Nortel Networks Limited is the principal direct
operating subsidiary of Nortel Networks Corporation.

                          *     *     *

Nortel Networks Corp. still carries Moody's Investors Service 'B3'
Senior Unsecured Debt rating which was placed on March 22, 2007.


OFF PRICE: Chapter 7 Filing and Store Closures Hurt Customers
-------------------------------------------------------------
Off Price Furniture, dba American Discount Outlets, filed for
chapter 7 liquidation with the U.S. Bankruptcy Court for the
Northern District of Texas on Feb. 1, 2008, and closed stores.

According to Foster's Daily Democrat in Dover, New Hampshire,
parties owed money by Off Price will meet on March 13, 2008.

Customers were frustrated because they couldn't replace items they
bought or get their money back, Daily Democrat relates.

The office of the Attorney General in Manchester, Texas, was
flooded with customer complaints, Daily Democrat says.  Senior
Assistant Attorney General Lauren Noether, Esq., told Daily
Democrat that customers should go to the Court and file proofs of
claims in order to obtain recovery.  However, Ms. Noether warned
that Off Price's creditors will be the first to be repaid over
consumers, Daily Democrat reports.

Ms. Noether added that those who weren't able to get any products
must approach their credit card companies to reverse the credit
amounts.  She said that Off Price wasn't required to notify
customers about its closure and bankruptcy, Daily Democrat says.

Off Price Furniture, dba American Discount Outlets, is owned by
Carroll Dudley.


ONEIDA LTD: Selling Business in Australia to McPherson's Limited
----------------------------------------------------------------
Oneida Ltd. has reached an agreement to sell its business in
Australia to McPherson's Limited.  As part of the sale, Oneida
also has agreed to license certain trademarks to McPherson's for
its exclusive use in Australia and New Zealand.

The financial terms of the transaction were not disclosed.

The transaction is expected to close today, Feb. 29, 2008.

"Our business in Australia has been very successful and our brands
are well known," James E. Joseph, president and chief executive
officer of Oneida, said.  "However, after a thorough analysis we
determined that the best path for continued growth for the
business would be to align it with a well established, diversified
distributor of consumer products in the country.  McPherson's is
an outstanding company, and it will be an excellent platform
for our brands."

Under the terms of the agreement, Oneida will also license its
Oneida, Sant'Andrea and Viners trademarks to McPherson's.

"We see excellent potential to license our brands to well-
established regional companies in order to expand our geographic
footprint and exploit new markets, and we expect licensing to be
an important source of growth for Oneida in the future," added
Mr. Joseph.

Upon completion, Gregory L. Woodhall, managing director of Oneida
Australia, will be appointed head of Oneida's international
foodservice division, a new position.  He will be based in
Oneida's Hong Kong office and will focus on Asia and the Middle
East -- the world's fastest growing foodservice markets.

"Greg is a highly capable individual, and we are very pleased that
he will be leading our international foodservice business, which
holds tremendous opportunities for growth and is a major strategic
focus for the company," Mr. Joseph said.

                     About McPherson's Limited

Headquartered in Sydney, Australia, McPherson's Limited (ASX:MCP)
-- http://www.mcphersons.com.au/-- is a consumer products company  
The product range includes cutlery, kitchen knives, glassware,
kitchenutensils, scales, bakeware, hardware and garden products.  
The company also offers a range of commercial services in the
production and distribution of loose-leaf product, journals,
newsletters and technical manuals.

                         About Oneida Ltd.

Based in New York City and incorporated in 1880, Oneida Ltd. --
http://www.oneida.com/-- is a design, sourcing and distribution  
company for stainless steel and silver-plated flatware for both
the consumer and foodservice industries.  

                           *     *     *

Standard & Poor's  placed Oneida Ltd.'s long term foreign and
local issuer credit ratings at 'B' in June 2007.  The ratings
still hold to date with a negative outlook.


OVERSEAS SHIPHOLDING: Net Income Drops at $21.2MM For 4th Qtr.
--------------------------------------------------------------
Overseas Shipholding Group Inc. reported net income for the three
months ended Dec. 31, 2007 of $21.2 million, a decline of
$92.2 million, from $113.2 million net income for the same period
of the prior year.  For the fiscal year ended Dec. 31, 2007, the
company's net income is $211.3 million compared to $392.7 million
net income for fiscal 2006.

The company generated shipping revenues of $276.8 million for the
2007 fourth quarter in comparison to $259.8 million for the 2006
fourth quarter.  For the full fiscal year 2007, the company
generated revenues of $1,129.3 million compared to
$1,047.4 million revenues for 2006.

"OSG's expansion and diversification has created a global shipping
company that is well-positioned to thrive in any market," Morten
Arntzen, president and chief executive officer of OSG, stated.   
"In 2007, we strengthened our leadership position in each of the  
markets we trade."

"The acquisition of Heidmar Lightering, the IPO of substantially
all of the assets in our U.S. Flag unit structured as a master
limited partnership, the expansion and diversification of our
crude oil and product fleets with Suezmax and LR1 tankers, and our
entrance into the U.S. ultra-deepwater shuttle tanker trade, were
just a few of the transactions undertaken to increase earnings and
cash flows in the future," Mr. Arntzen continued.  "In the last 18
months we repurchased nearly 22% of our total outstanding stock,
and in 2007, our shareholders enjoyed a 32.2% year-over-year gain
in our stock price compared with the Dow Jones Transportation
average of less than 1%."

"Indications are that the first quarter of 2008 will be a strong
start to the year," Mr. Arntzen concluded

>From Oct. 1, 2007 through Dec. 31, 2007, OSG repurchased 125,000
shares at an average price per share of $61.62.  Since the initial
statement of its share repurchase program on June 9, 2006, the
company has repurchased 8.6 million shares, constituting 21.7% of
total shares outstanding at a total cost of $569.5 million.  The
company's current $200 million repurchase program has a total of
$44.8 million that remains outstanding.

On Nov. 15, 2007, OSG completed the initial public offering of OSG
America L.P., a master limited partnership, issuing 7.5 million
common units, priced at $19.00 per unit.  The transaction
generated $129.3 million in proceeds to OSG, which the company
used to pay down debt in the fourth quarter.

As of Dec. 31, 2007, the company's balance sheet reflected total
assets of $4.15 billion, total debts of $2.34 billion resulting to
a total stockholder's equity of $1.81 billion.

                    About Overseas Shipholding

Headquartered in New York, New York, Overseas Shipholding Group,
Inc. (NYSE:OSG) -- http://www.osg.com-- is a bulk shipping  
company engaged in the ocean transportation of crude oil and
petroleum products.  At Dec. 31, 2006, the company owned or
operated a fleet of 103 vessels, of which 80 vessels operated in
the international market and 23 operated in the United States flag
market.  OSG's newbuilding program of owned and chartered-in
vessels totaled 34, and extends across each of its operating
segments, bringing the company's total operating and newbuild
fleet to 137 vessels.  OSG's vessel operations are organized into
strategic business units and focused on market segments each
serve: crude oil, refined petroleum products, United States flag
vessels and gas.  In April 2007, the company completed the
acquisition of the Heidmar lightering business from Heidmar Inc.,
a subsidiary of Morgan Stanley Capital Group Inc.


OVERSEAS SHIPHOLDING: S&P Ratings Unaffected By Net Profit Decline
------------------------------------------------------------------
Overseas Shipholding Group Inc. (OSG; BB/Stable/--), reported a
fourth-quarter 2007 net profit of $21 million, well below
$113 million in the like period last year.  Standard & Poor's
Ratings Services said that its ratings on OSG, which were lowered
to current levels Jan. 17, 2008, and outlook are not affected.

The much-weaker results reflect significantly lower time-charter-
equivalent rates for vessels operating in the spot market.  OSG
has about a 60% revenue contribution from the volatile spot
market.  OSG, like other carriers of crude oil and refined
petroleum products, is susceptible to significant supply and
demand fluctuations.  The company expects a better TCE rate
environment in the first quarter of 2008 and has a substantial
portion of first-quarter 2008 revenues already locked in.   
Liquidity remains good, with about $500 million of unrestricted
cash and about $1 billion available under its $1.8 billion
revolving line of credit.


PACIFIC PINNACLE: Moody's Junks Ratings on Five Classes of Notes
----------------------------------------------------------------
Moody's Investors Service downgraded ratings of seven classes of
notes issued by Pacific Pinnacle CDO Ltd, and left on review for
possible further downgrade the rating of five of these classes.

The notes affected by this rating action are:

Class Description: $800,000,000 Class A-1LA Floating Rate Notes
Due January 2052

  -- Prior Rating: Aaa
  -- Current Rating: Ba1, on review for possible downgrade

Class Description: $74,600,000 Class A-1LB Floating Rate Notes Due
January 2052

  -- Prior Rating: Aaa
  -- Current Rating: Caa3, on review for possible downgrade

Class Description: $75,400,000 Class A-1LC Floating Rate Notes Due
January 2052

  -- Prior Rating: Aaa
  -- Current Rating: Caa3, on review for possible downgrade

Class Description: $18,000,000 Class A-2L Floating Rate Notes Due
January 2052

  -- Prior Rating: Aa2, on review for possible downgrade
  -- Current Rating: Caa3, on review for possible downgrade

Class Description: $12,000,000 Class A-3L Floating Rate Deferrable
Interest Notes Due January 2052

  -- Prior Rating: A2, on review for possible downgrade
  -- Current Rating: C

Class Description: $11,000,000 Class B-1L Floating Rate Deferrable
Interest Notes Due January 2052

  -- Prior Rating: Baa2, on review for possible downgrade
  -- Current Rating: C

Class Description: Class X Interest Only Notes Due January 2019

  -- Prior Rating: Aaa
  -- Current Rating: Ba1, on review for possible downgrade

The rating downgrade actions reflect deterioration in the credit
quality of the underlying portfolio, as well as the occurrence on
Jan. 30, 2008, as reported by the Trustee, of an event of default
described in Section 5.1(d) of the Indenture dated Dec. 21, 2006.

Pacific Pinnacle CDO Ltd is a collateralized debt obligation
backed primarily by a portfolio of RMBS securities and CDO
securities.

Recent ratings downgrades on the underlying portfolio caused
ratings-based haircuts to affect the calculation of the event of
default trigger.  Thus, the ratio of (x) the Par Value Coverage
Amount less the Total Par Value Haircut Amount to (y) an amount
equal to the Aggregate Outstanding Amount of the Class A-1 Notes
is less than 100%, as required in Section 5.1(d) of the Indenture.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.

The rating downgrades taken reflect the increased expected loss
associated with each tranche.  Losses are attributed to diminished
credit quality on the underlying portfolio.  The severity of
losses of certain tranches may be different, however, depending on
the timing and choice of remedy to be pursued by certain
Noteholders.  Because of this uncertainty, the ratings assigned to
the Class A-1LA Notes, Class A-1LB Notes, Class A-1LC Notes, Class
A-2L Notes and the Class X Interest Only Notes remain on review
for possible further action.


PAMPELONNE CDO: Moody's Junks Rating on $50 Mil. Notes From 'Ba1'
-----------------------------------------------------------------
Moody's Investors Service downgraded ratings of seven classes of
notes issued by Pampelonne CDO I, Ltd., and left on review for
possible further rating action ratings of one of these classes of
notes.  The notes affected by this rating action are:

Class Description: Up to $1,062,500,000 Class S Notes

  -- Prior Rating: Aa3, on review for possible downgrade
  -- Current Rating: B3, on review with future direction uncertain

Class Description: $50,000,000 Class A-1 Senior Floating Rate
Notes Due 2051

  -- Prior Rating: Ba1, on review for possible downgrade
  -- Current Rating: C

Class Description: $50,000,000 Class A-2 Senior Floating Rate
Notes Due 2051

  -- Prior Rating: Ba1, on review for possible downgrade
  -- Current Rating: C

Class Description: $43,750,000 Class B Floating Rate Notes Due
2051

  -- Prior Rating: B3, on review for possible downgrade
  -- Current Rating: C

Class Description: $18,750,000 Class C Floating Rate Deferrable
Notes Due 2051

  -- Prior Rating: Caa3, on review for possible downgrade
  -- Current Rating: C

Class Description: $11,500,000 Class D Floating Rate Deferrable
Notes Due 2051

  -- Prior Rating: Ca
  -- Current Rating: C

Class Description: $5,000,000 Class E Floating Rate Deferrable
Notes Due 2051

  -- Prior Rating: Ca
  -- Current Rating: C

The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence as reported by
the Trustee on Nov. 9, 2007, of an event of default caused by a
failure of the Class A-1 EOD Ratio to be greater than or equal to
the required level pursuant Section 5.1(e) of the Indenture dated
October 19, 2006.  This event of default is still continuing.   
Pampelonne CDO I, Ltd. is a hybrid collateralized debt obligation
backed primarily by a portfolio of RMBS securities CDO securities
and synthetic securities in the form of credit default swaps.   
Reference obligations for the credit default swaps are RMBS and
CDO securities.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of Notes may be
entitled to direct the Trustee to take particular actions with
respect to the Collateral Debt Securities and the Notes.  In this
regard the Trustee reports that a majority of the Controlling
Class has directed the Trustee to declare the principal of and
accrued and unpaid interest on the Notes to be immediately due and
payable and to terminate the Reinvestment Period.  Furthermore,
according to the Trustee, a majority of the Controlling Class has
directed the Trustee to commence the process of the sale and
liquidation of the Collateral in accordance with relevant
provisions of the transaction documents.

The rating downgrades taken reflect the increased expected loss
associated with each tranche.  Losses are attributed to diminished
credit quality on the underlying portfolio.  The severity of
losses of certain tranches may be different, however, depending on
the timing and outcome of the liquidation.  Because of this
uncertainty, the ratings assigned to the Class S Notes remain on
review for possible further action.


PELOTON PARTNERS: Liquidates $2 Billion ABS Fund
------------------------------------------------
Peloton Partners LLP said that it is liquidating its $2 billion
ABS Fund citing a drop in the value of highly rated mortgage
securities as well as being unable to meet the "margin calls" made
by banks, published reports say.

Peloton founders Ron Beller and Geoff Grant, former Goldman Sachs
Group Inc. partners, told  investors that they would be selling
off the assets of their billion ABS fund, stating that it was the
"best solution" in order to "Stabilize the situation," reports
say.

Peloton also stopped redemptions from its $1.6 billion Multi-
Strategy Fund, which according to reports, has a sizable stake in
the ABS Fund.

Citing a person familiar, The Wall Street Journal reports that
Messrs.  Beller and Grant lost about $120 million of personal
money invested in Peloton.

Headquartered in London, England, Peloton Partners LLP --
http://www.pelotonpartners.com/-- is a hedge fund manager that  
was recognized as one of the best performers in London's hedge
fund community for 2007.  The fund employs around 60 people in
London and another 10 in Montecito, California.


PHARMED GROUP: Wants Exclusive Plan Filing Period Extended
----------------------------------------------------------
Pharmed Group Holdings Inc. and its debtor-affiliates ask the
United States Bankruptcy Court for the Southern District of
Florida to extend their exclusive periods to:

   a) file a Chapter 11 plan until April 25, 2008; and

   b) solicit acceptances of that plan until May 25, 2008.

The Debtors tell the Court that they need sufficient time to
finalized and file a disclosure statement and proposed Chapter 11
plan.

According to the motion, the Debtors and the appointed Official
Committee of Unsecured Creditors are in talks regarding the terms
of a joint liquidating plan.

The Debtors say that they have made good progress towards
reorganization and complied with all of the operating guidelines
of the United States Trustee.

The Debtors state that no creditors in interest will be prejudiced
by the extension of their exclusive periods.

The Debtors' exclusive period to file their plan expired on
Feb. 25, 2008.

                       About Pharmed Group

Headquartered in Miami, Florida, Pharmed Group Holdings Inc. --
http://www.pharmed.com/-- and its affiliates sends drugs and
medical supplies on Caribbean cruises.  They distribute medical,
rehabilitative, and surgical supplies throughout the southeastern
U.S., as well as Caribbean, and Central and South American
countries.  They deliver products made by Dynatronics, Welch
Allyn, and Smith & Nephew.  In addition to their distribution
businesses, they make and distribute vitamins, minerals,
nutraceuticals, and dietary supplements.

The company and four debtor-affiliates filed for chapter 11
protection on Oct. 26, 2007 (Bankr. S.D. Fl. Case Nos. 07-19187
through 07-19191).  Paul Steven Singerman, Esq., and Brian Rich,
Esq., at Berger Singerman PA, represent the Debtors.  Trumbull
Group LLC serves as the Debtors' claims and noticing agent.  


PHARMED GROUP: Taps Jonathan Green as Special Tax Counsel
---------------------------------------------------------
Pharmed Group Holdings Inc. and its debtor-affiliates ask the
United States Bankruptcy Court for the Southern District of
Florida for permission to employ Jonathan H. Green & Associates
P.A. as special tax counsel.

As the Debtors' tax counsel, Jonathan Green will assist the
Debtors in connection with the termination and liquidation of the
Debtors' 401(k) profit sharing plan.

In a separate Court filing, the Debtors also seek the Court's
approval to appoint Neil A. Useden and Thomas H. Gellman of ERISA
Pension Systems Incorporated in Miami, Florida, to assist the
Debtors in the liquidation of the 401(k) plan.  Messrs. Useden and
Gellman will take control of the plan assets and calculate excise
taxes for 2007 on a prohibited transaction.

The Debtor will pay a flat fee of $7,500 to Jonathan Green for
this engagement.

To the best of the Debtors' knowledge, Jonathan Green does not
hold any interests adverse to the Debtors' estate and is a
"disinterested person" as defined in Section 101(14) of the
Bankruptcy Code.

                       About Pharmed Group

Headquartered in Miami, Florida, Pharmed Group Holdings Inc. --
http://www.pharmed.com/-- and its affiliates sends drugs and
medical supplies on Caribbean cruises.  They distribute medical,
rehabilitative, and surgical supplies throughout the southeastern
U.S., as well as Caribbean, and Central and South American
countries.  They deliver products made by Dynatronics, Welch
Allyn, and Smith & Nephew.  In addition to their distribution
businesses, they make and distribute vitamins, minerals,
nutraceuticals, and dietary supplements.

The company and four debtor-affiliates filed for chapter 11
protection on Oct. 26, 2007 (Bankr. S.D. Fl. Case Nos. 07-19187
through 07-19191).  Paul Steven Singerman, Esq., and Brian Rich,
Esq., at Berger Singerman PA, represent the Debtors.  Trumbull
Group LLC serves as the Debtors' claims and noticing agent.  


PINNACLE PEAK: Moody's Junks Rating on $140 Mil. Notes From 'Aaa'
-----------------------------------------------------------------
Moody's Investors Service downgraded ratings of five classes of
notes issued by Pinnacle Peak CDO I. Ltd and left on review for
possible further downgrade the rating of one of these classes.  In
addition, Moody's has placed its ratings of two classes of Notes
issued by the Issuer on review for possible downgrade.  The notes
affected by this rating action are:

Class Description: $750,000,000 Class A1M Floating Rate Notes Due
2047

  -- Prior Rating: Aaa,
  -- Current Rating: Aaa, on review for possible downgrade

Class Description: $265,000,000 Class A1Q Floating Rate Notes Due
2047

  -- Prior Rating: Aaa,
  -- Current Rating: Aaa, on review for possible downgrade

Class Description: $260,000,000 Class A2 term loan made pursuant
to the Class A2 Loan Agreement

  -- Prior Rating: Aaa (WD)
  -- Current Rating: A3, on review for possible downgrade

Class Description: $140,000,000 Class A3 Floating Rate Notes Due
2047

  -- Prior Rating: Aaa, on review for possible downgrade
  -- Current Rating: Ca

Class Description: $35,000,000 Class A4 Floating Rate Notes Due
2047

  -- Prior Rating: Aa2, on review for possible downgrade
  -- Current Rating: C

Class Description: $15,000,000 Class B Deferrable Floating Rate
Notes Due 2047

  -- Prior Rating: A2, on review for possible downgrade
  -- Current Rating: C

Class Description: $15,000,000 Class C Deferrable Floating Rate
Notes Due 2047

  -- Prior Rating: Baa2, on review for possible downgrade
  -- Current Rating: C

The rating actions reflect deterioration in the credit quality of
the underlying portfolio, as well as the occurrence on Jan. 10,
2008, as reported by the Trustee, of an event of default described
in Section 5.1(d) of the Indenture dated July 3, 2007.  Moody's
has also received notification from the Trustee on Feb. 1, 2008
that the Controlling Party has directed the Acceleration of the
Maturity consistent with Section 5.2(a) of the Indenture.

Pinnacle Peak CDO I, Ltd. is a collateralized debt obligation
backed primarily by a portfolio of RMBS Securities and ABS CDO
Securities for which the primary exposure is to RMBS Securities.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, certain holders of Notes
may be entitled to direct the Trustee to commence the process of
sale and liquidation of the collateral.

The rating downgrades taken reflect the increased expected loss
associated with each tranche.  Losses are attributed to diminished
credit quality on the underlying portfolio.  The severity of
losses of certain tranches may be different, however, depending on
the timing and outcome of a liquidation.  Because of this
uncertainty, the ratings assigned to the Class A1 and Class A2
notes remain on review for possible further action.


PLASTECH ENGINEERED: Court Extends DIP Financing Until March 3
--------------------------------------------------------------
The Honorable Phillip Shefferly of the U.S. Bankruptcy Court for
the Eastern District of Michigan extended, until March 3, 2008,
Plastech Engineered Products Inc. and its debtor-affiliates'
postpetition loan provided by Bank of America, N.A., as
administrative agent, and a syndicate of lenders.

The Court authorized the Debtors to continue obtaining financing
from the DIP Lenders of up to an aggregate principal amount
outstanding at any time not to exceed $37,150,000 plus interest,
fees and other charges payable.

The Court also allowed the Debtors to continue using their
lenders' cash collateral.

The DIP Lenders are the same group who provided the Debtors with
a $200,000,000 loan under a Revolving Credit Facility entered
into on Feb. 12, 2007.  The DIP Lenders' willingness to make
additional credit extensions is conditioned upon, among other
things:

   (i) the Debtors obtaining the Court's order authorizing the
       continued financing pursuant to the Amended DIP Credit
       Agreement and satisfying certain conditions, including,
       without limitation, obtaining and delivering to DIP Agent:

       -- an amended and restated guaranty from Plastech's major
          customers General Motors Corporation, Ford Motor
          Company, and Johnson Controls, Inc., and

       -- additional cash collateral of $6,900,000 -- bringing
          the total cash collateral delivered under the guaranty,
          as amended and restated, to $9,900,000, and

  (ii) the DIP Agent obtaining agreements duly executed and
       delivered by the Major Customers and Chrysler limiting
       set-offs on postpetition accounts to "ordinary course
       issues" capped at a percentage not to exceed 10% of
       invoice in the case of Major Customers and 5% of invoice
       in the case of Chrysler.

No proceeds of DIP Loans and no Cash Collateral will be used for
the Debtors' production for any customer -- other than their major
customers General Motors Corporation, Ford Motor Company, and
Johnson Controls, Inc. -- whose purchases represent more than 5%
of the Debtors' total sales unless that customer provides
financial accommodations to the Debtors of substantially the same
nature and scope as those being provided by the Major Customers.  

The DIP Loans and Cash Collateral may be used by the Debtors to
the extent necessary for the Debtors to discharge existing
postpetition contractual obligations to Chrysler through
February 15, 2008.

Except with respect to production at the Debtors' plants located
in Shreveport, Louisiana; Winnsboro, North Carolina; Wauseon,
Ohio; Cleveland, Ohio; and Leamington, Ontario, each Major
Customer will forbear from resourcing the production of its
component parts currently on contract with any of the Debtors
through the earlier of:

  (a) the occurrence of a Resourcing Default, i.e. (i) the
      Debtors are unable to meet timely their obligations to the
      applicable Major Customer without additional or further
      extraordinary customer accommodations or (ii) DIP Credit
      Parties declare a default under the Amended DIP Credit
      Agreement and cease making DIP Loans to Debtors, and

  (b) March 3, 2008.

All amounts due under the DIP Facility will be immediately due
and payable if the Court does not enter an order authorizing the
Debtors to obtain permanent postpetition superpriority
indebtedness under the DIP Facility by March 10, 2008.

The Court is scheduled to convene a hearing to consider final  
approval of the DIP Facility on March 3, 2008, at 2:00 p.m.,
Eastern Time.

                    About Plastech Engineered

Based in Dearborn, Michigan, Plastech Engineered Products, Inc. --
http://www.plastecheng.com/-- is full-service automotive
supplier of interior, exterior and underhood components.  It
designs and manufactures blow-molded and injection-molded plastic
products primarily for the automotive industry.  Plastech's
products include automotive interior trim, underhood components,
bumper and other exterior components, and cockpit modules.  
Plastech's major customers are General Motors, Ford Motor Company,
and Toyota, as well as Johnson Controls, Inc.

Plastech is a privately held company and is the largest family-
owned company in the state of Michigan.  The company is certified
as a Minority Business Enterprise by the state of Michigan.  
Plastech maintains more than 35 manufacturing facilities in the
midwestern and southern United States.  The company's products are
sold through an in-house sales force.

The company and eight of its affiliates filed for Chapter 11
protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08-
42417).  Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher &
Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C.,
represent the Debtors in their restructuring efforts.  The Debtors
chose Jones Day as their special corporate and litigation counsel.  
Lazard Freres & Co. LLC serves as the Debtors' investment bankers,
while Conway, MacKenzie & Dunleavy provide financial advisory
services.  The Debtors also employed Donlin, Recano & Company as
their claims and noticing agent.

An Official Committee of Unsecured Creditors has been appointed in
the Debtors' cases.

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.


PLASTECH ENGINEERED: Agrees to Supply Chrysler Until March 3
------------------------------------------------------------
Plastech Engineered Products Inc. and its debtor-affiliates have
agreed to continue its supply of parts to Chrysler LLC until
March 3, 2008, Crain's Detroit Business reports.

As reported in the Troubled Company Reporter on Feb. 22, 2008, the
Debtors and Chrysler previously agreed to an extension of their
interim production agreement, under which Plastech will continue
to manufacture and deliver component parts to Chrysler until
Feb. 27, 2008.

Pursuant to the initial interim agreement between the parties:

   -- Chrysler was obligated to make certain payments to
      Plastech in conjunction with the continued production of
      component parts; and

   -- The Debtors are to allow BBK, as agents for Chrysler, to
      have supervised access to Plastech facilities for the
      purpose of inspecting and conducting an inventory of all
      tooling used for Chrysler production.

The U.S. Bankruptcy Court for the Eastern District of Michigan
denied Chrysler LLC's request to pull out the tooling equipment
from Plastech's plants a few weeks ago.

                       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.

                    About Plastech Engineered

Based in Dearborn, Michigan, Plastech Engineered Products, Inc. --
http://www.plastecheng.com/-- is full-service automotive
supplier of interior, exterior and underhood components.  It
designs and manufactures blow-molded and injection-molded plastic
products primarily for the automotive industry.  Plastech's
products include automotive interior trim, underhood components,
bumper and other exterior components, and cockpit modules.  
Plastech's major customers are General Motors, Ford Motor Company,
and Toyota, as well as Johnson Controls, Inc.

Plastech is a privately held company and is the largest family-
owned company in the state of Michigan.  The company is certified
as a Minority Business Enterprise by the state of Michigan.  
Plastech maintains more than 35 manufacturing facilities in the
midwestern and southern United States.  The company's products are
sold through an in-house sales force.

The company and eight of its affiliates filed for Chapter 11
protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08-
42417).  Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher &
Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C.,
represent the Debtors in their restructuring efforts.  The Debtors
chose Jones Day as their special corporate and litigation counsel.  
Lazard Freres & Co. LLC serves as the Debtors' investment bankers,
while Conway, MacKenzie & Dunleavy provide financial advisory
services.  The Debtors also employed Donlin, Recano & Company as
their claims and noticing agent.

An Official Committee of Unsecured Creditors has been appointed in
the Debtors' cases.

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.


POPE & TALBOT: Has Interim OK to Obtain DIP Loan; Monitor Comments
------------------------------------------------------------------
The Honorable Christopher Sontchi of the U.S. Bankruptcy Court for
the District of Delaware approved, on an interim basis, the terms
and conditions and provisions of the Third Amendment to Pope &
Talbot Inc. and its debtor-affiliates' DIP Credit and Security
Agreement with Ableco Finance LLC, Wells Fargo Financial
Corporation Canada, and certain other lenders.

The Court also amended its Final DIP Order, to the extent
necessary to incorporate the terms and conditions and provisions
of the Third Amendment, including replacing, in paragraph 8, the
words "January 31, 2008" with the words "the Final Maturity
Date".

Except as otherwise amended and modified by the Amended DIP
Interim Order and the Third Amendment, the terms and conditions
and provisions of the DIP Final Order will continue in all
respects, in full force and effect.

The Court will convene a final hearing on March 11, 2008, at 2:00
p.m., to consider the Debtors' DIP Extension Motion.  Pursuant to
Del. Bankr. LR 9006-2, the Debtors' request to extend their
DIP financing is automatically extended until the conclusion of
that hearing.

                       Monitor's Comments

PricewaterhouseCoopers Inc., as monitor of the proceedings
commenced by Pope & Talbot Ltd. and its subsidiaries under the
Companies' Creditors Arrangement Act, stated that the Applicants
expect to remain in compliance with the terms and maximum
commitment under revolver portion of the DIP Credit Agreement.

Thus, neither of the Amendments provides for an increase
in the amount available to the Company under the DIP Revolving
Loan, the Monitor noted.

However, the Monitor pointed out that the Amendment does not
address the anticipated increase under the DIP Term Loan of
$1,200,000, as provided in the Applicants' Revised Forecast.  
"This amount was provided in the Revised Forecast to cover
additional Lender’s interest and professional fees associated
with the extension," the Monitor explained.  

There are no additional funds available to the Applicants, the
Monitor told the Canadian Court.

According to the Monitor, the Third Amendment provides for
Administrative Expense Priorities for trade and utility expenses
to a maximum of $2,000,000.

The Applicants typically maintain a trade accounts payable
balance of between $2,000,000 and $8,000,000, and accordingly,
the $2,000,000 caps will not likely provide for the payment of
all post-filing creditors, the Monitor maintained.

The post-filing creditors would then need to get satisfied from a
surplus after repayment of the DIP loan, the Monitor stated.
Although the Applicants are currently anticipating that there
will be a surplus available to unsecured creditors, should
current estimates change, it is possible that there will not be
funds available to pay post-filing trade creditors.

While the Monitor noted that it has not been involved in the
Applicants' efforts to extend financing, nor was it involved in
the negotiation of the Amendments, the Monitor understands that
the Extended DIP Agreement represents the only additional
financing that is currently available to the Applicants.

The Monitor reported that as at Feb. 15, 2008, the total
amount outstanding under the operating portion of the DIP Credit
Agreement was $65,900,000.  This includes outstanding revolver
borrowings of $53,900,000 and DIP Term Borrowings of $12,000,000.

                       About Pope & Talbot

Based in Portland, Oregon, Pope & Talbot Inc. (Other OTC:
PTBT.PK) -- http://www.poptal.com/-- is a pulp and wood products
business.  Pope & Talbot was founded in 1849 and produces market
pulp and softwood lumber at mills in the US and Canada.  Markets
for the company's products include the US, Europe, Canada, South
America and the Pacific Rim.

The company and its U.S. and Canadian subsidiaries applied for
protection under the Companies' Creditors Arrangement Act of
Canada on Oct. 28, 2007.  The Debtors' CCAA Stay expired
on Jan. 16, 2008.

The company and fourteen of its debtor-affiliates filed for
Chapter 11 protection on Nov. 19, 2007 (Bankr. D. Del. Lead Case
No. 07-11738).  Shearman & Sterling LLP is the Debtor's bankruptcy
counsel, while Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl
& Jones L.L.P. represents the Debtors as bankruptcy co-counsel.
The Official Committee of Unsecured Creditors selected Fried,
Frank, Harris, Shriver & Jacobson LLP as its bankruptcy counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$681,960,000 and total debts of $601,090,000.

The Debtors' exclusive period to file a plan expires on March 18,
2008.

Pope & Talbot Pulp Sales Europe, LLC, a subsidiary, on Nov. 21,
2007, filed an application for relief under Belgian bankruptcy
laws in the commercial court in Brussels.  If the Belgian court
grants Pope & Talbot Europe's application, it is expected it will
be liquidated through the bankruptcy proceeding.

(Pope & Talbot Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


POPE & TALBOT: Court Fixes Claims Bar Date at April 3
-----------------------------------------------------
The Honorable Christopher Sontchi of the U.S. Bankruptcy Court for
the District of Delaware approved Pope & Talbot Inc. and its
debtor-affiliates' proposed claims protocol in all respects, and
established:

   (i) April 3, 2008, as the deadline for creditors to assert
       claims arising on or before the bankruptcy filing against
       the Debtors to file original, written proofs of claim; and

  (ii) May 19, 2008, as the last day by which governmental units
       must file claims against any of the Debtors.

Proofs of Claim should state whether they are filed in United
States dollars or Canadian dollars, Judge Sontchi stated.  If
filed in Canadian dollars, the amount will be converted to United
States dollars at the rate of CA$1 is to US$1.0481.

All persons and entities that intend to rely on the Debtors'
Schedules of Assets and Liabilities will have the responsibility
for determining that their claims are accurately listed on the
Schedules.

Each claim holder who fails to timely file a claim will be
forever barred from:

   * asserting the claim, whether directly or indirectly, against
     the Debtors; and

   * voting upon, or receiving distributions under, any plan of
     reorganization or liquidation in the Debtors' Chapter 11
     proceedings.

In the event the Debtors amend or supplement their Schedules,
they will give notice of the amendment or supplement to the
affected claim holders, which will afford the claim holders a
30-day extension from the date on which the notice is given to
file a claim, if necessary, or be forever barred from doing so.

The Court also approved the Debtors' proposed notice of the Bar
Dates.

           Applicants Seek Approval of Claims Protocol

The Applicants sought the British Columbia Supreme Court's
approval of a claims process to solicit and quantify claims
against them, and their directors and officers.  

The Applicants also asked the Canadian Court to establish four
bar dates:

   (a) a claims bar date for the filing of claims on April 3,
       2008;

   (b) a government claims bar date on May 19, 2008;

   (c) a directors and officers claims bar date, to be set 40
       days after the closing of the last of four Sale
       transactions approved by the Court; and

   (d) a subsequent claims bar date for the filing of subsequent
       claims, arising as a result of repudiation or termination
       by the Applicants of any contract, lease or other
       agreement after the Canadian Filing Date, which will be
       the later of (1) the Claims Bar Date, or (2) 4:00 p.m.
       (PST) on the day which is 30 days after the date of the
       applicable repudiation or termination.

Kathy L. Mah, Esq., at Stikeman Elliott LLP, in Toronto, Canada,
told the Canadian Court that pursuant to the terms of the Initial
Order, the Applicants are required to indemnify their directors
and officers from all claims, costs, charges and expenses
relating to the failure of the Applicants to make payments
relating to employee wages, employee and pension benefits,
vacation pay and bonuses, employee related deductions, and
applicable sales and other taxes.  

To support the indemnity, the directors and officers were granted
a Court-ordered charge over all of the Applicants' property of up
to $13,000,000, which enjoys a super-priority status.

To be able to distribute the proceeds of the sale of the
Applicants' assets, it is necessary for them to conduct a claims
process to determine what claims, if any, may exist against the
directors and officers, which may be covered by the charge
granted in favor of the directors and officers, Ms. Mah
explained.

The Applicants also sought the Canadian Court's approval of the
same Claims Protocol approved by the Bankruptcy Court.

PricewaterhouseCoopers Inc., as monitor of the proceedings
commenced by Pope & Talbot Ltd. and its subsidiaries under the
Companies' Creditors Arrangement Act, notes that the Debtors'
Claims Protocol and the Applicants' Claims Procedure synchronize
the Canadian and the U.S claims processes, while recognizing
subtle differences in the laws and customary practices in each
country.

                       About Pope & Talbot

Based in Portland, Oregon, Pope & Talbot Inc. (Other OTC:
PTBT.PK) -- http://www.poptal.com/-- is a pulp and wood products
business.  Pope & Talbot was founded in 1849 and produces market
pulp and softwood lumber at mills in the US and Canada.  Markets
for the company's products include the US, Europe, Canada, South
America and the Pacific Rim.

The company and its U.S. and Canadian subsidiaries applied for
protection under the Companies' Creditors Arrangement Act of
Canada on Oct. 28, 2007.  The Debtors' CCAA Stay expired
on Jan. 16, 2008.

The company and fourteen of its debtor-affiliates filed for
Chapter 11 protection on Nov. 19, 2007 (Bankr. D. Del. Lead Case
No. 07-11738).  Shearman & Sterling LLP is the Debtor's bankruptcy
counsel, while Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl
& Jones L.L.P. represents the Debtors as bankruptcy co-counsel.
The Official Committee of Unsecured Creditors selected Fried,
Frank, Harris, Shriver & Jacobson LLP as its bankruptcy counsel.
When the Debtors filed for bankruptcy, they listed total assets of
$681,960,000 and total debts of $601,090,000.

The Debtors' exclusive period to file a plan expires on March 18,
2008.

Pope & Talbot Pulp Sales Europe, LLC, a subsidiary, on Nov. 21,
2007, filed an application for relief under Belgian bankruptcy
laws in the commercial court in Brussels.  If the Belgian court
grants Pope & Talbot Europe's application, it is expected it will
be liquidated through the bankruptcy proceeding.

(Pope & Talbot Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


PRB ENERGY: Defaults Obligations Under Senior Secured Debentures
----------------------------------------------------------------
PRB Energy Inc. is in default with respect to certain of its
obligations under the Debentures and certain other related
transaction documents, according to the company regulatory filing
with the Securities and Exchange Commission.

The company received written notice from DKR Soundshore Oasis
Holding Fund Ltd. and West Coast Opportunity Fund LLC, the holders
of the company's $15 million Senior Secured Debentures due
Aug. 31, 2008.

Specifically, the notice claims that the company defaulted by
failing to honor its obligations under a letter agreement dated
June 15, 2007 with the Senior Lenders relating to the proceeds
from the company's settlement agreement with Rocky Mountain Gas
and by failing to take all actions necessary to maintain title to
certain of the collateral securing the company's obligations under
the Debentures.

The notice also notifies the company that as a remedy for such
alleged defaults, an automatic redemption by the Company of the
Debentures has occurred.

The Senior Lenders assert that, upon default, the Debentures
shall be redeemed by the Company at a price equal to 110% of the
outstanding principal amount and accrued and unpaid interest and
accrued and unpaid late charges and interest.

The company disagrees with this assertion.  The company does not
believe that a default under the Debentures has occurred and is
working with the Senior Lenders in an effort to settle the dispute
of whether any default has occurred and whether a redemption has
occurred.

In addition, the company is exploring all of the strategic
alternatives available to it under applicable law, including
filing for bankruptcy protection, as a result of this notice from
the Senior Lenders and given its current liquidity position.

                        About PRB Energy

Headquartered in Denver, PRB Energy, Inc. operates as an
independent energy company. It engages in the acquisition,
exploitation, development, and production of natural gas and oil.

                           *    *    *

As reported in the Troubled Company Reporter on Jan. 9, 2008,
After reporting a positive working capital of $13.71 million at
Dec. 31, 2006, PRB Energy, Inc. recorded a $35.39 million working
capital deficit at Sept. 30, 2007.


QUIGLEY COMPANY: Posts $7.2 Million Net Loss in Year Ended Dec. 31
------------------------------------------------------------------
Quigley Company Inc. reported a net loss of $7,187,094 on total
interest and services income of $1,411,483 for the year ended
Dec. 31, 2007, compared with a net loss of $7,074,677 on total
interest and services income of $1,539,545 for the year ended
Dec. 31, 2006.

At Dec. 31, 2007, the company's balance sheet showed $106,596,996
in total assets and $127,005,859 in total liabilities, resulting
in a $20,408,863 total stockholders' deficit.  This compares with
total assets of $108,621,223, total liabilities of $121,842,992,
and total stockholders' deficit of $13,221,769 as of Dec. 31,
2006.

                         About Quigley Co.

Quigley Company Inc., a division of Pfizer Inc., sold asbestos-
containing insulation products until the early 1970s.  Quigley
filed for protection under chapter 11 of the United States
Bankruptcy Code on Sept. 3, 2004 (Case No. 04-15739-SMB) in order
to implement a proposed global resolution of all pending and
future asbestos-related personal injury liabilities.

Asbestos victims and Pfizer have been negotiating a settlement
deal which calls for Pfizer to pay $430 million to 80% of existing
plaintiffs.  It will also place an additional $535 million into an
asbestos settlement trust that will compensate future plaintiffs
as well as the remaining 20% of current plaintiffs with claims
against Pfizer and Quigley.  The compensation deal is worth
$965 million all up.  Of that $535 million, $405 million is in a
40-year note from Pfizer, while $100 million will come from
insurance policies.

Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte
Roth & Zabel LLP, represent the Debtor in its restructuring
efforts.  Elihu Inselbuchm Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Unsecured Creditors.  When
the Debtor filed for protection from its creditors, it listed
$155,187,000 in total assets and $141,933,000 in total debts.

                     Reorganization Plan Update

In August 2006, the Bankruptcy Court rejected the Debtor's Third
Amended Plan of Reorganization after the Debtor failed to obtain
acceptance of its Third Amended Plan of Reorganization from 75% of
the holders of asbestos-related personal injury claims who voted
to accept or reject the Plan.  That 75% acceptance rate is
required to confirm a chapter 11 plan centered around a trust
formed under Sec. 524(g) of the Bankruptcy Code to future
resolution of asbestos-related claims.

The Debtor subsequently sought the Court's reconsideration on its
Aug. 9, 2006 order, arguing that the claims voted by holders of
asbestos personal injury claims who had entered into prepetition
settlements with Pfizer should be reduced by 90% for voting
purposes.

The Debtor further argued that the Court may not have considered
certain direct authority -- including the decisions of at least
two Courts of Appeals and the decisions of many other courts
following them -- that is in conflict with the Court's ruling.

As reported in the Troubled Company Reporter on May 11, 2007, the
company's Ad-hoc Committee of Tort Victims asked the Court to
appoint a Chapter 11 trustee in the Debtor's bankruptcy
proceeding.


SCHUYLER GUEST: Case Summary & 17 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Schuyler Guest Home, Inc.
        dba Cambridge Guest Home
        dba Schuyler Guest Home
        167 Hayes Road
        Schuylerville, NY 12871

Bankruptcy Case No.: 08-10501

Type of Business: The Debtor provides health care services.

Chapter 11 Petition Date: February 26, 2008

Court: Northern District of New York (Albany)

Judge: Robert E. Littlefield Jr.

Debtor's Counsel: Richard H. Weiskopf, Esq.
                   (rweiskopf@oalaw.com)
                  O'Connell & Aronowitz
                  54 State Street, 9th Floor
                  Albany, NY 12207
                  Tel: (518) 462-5601
                  Fax: (518) 462-2670
                  http://www.oalaw.com/

Total Assets: $1,881,100

Total Debts:  $2,107,880

Consolidated Debtor's List of 17 Largest Unsecured Creditors:

   Entity                                            Claim Amount
   ------                                            ------------
   GA Bove                                           $12,895
   76 Railroad Street                                
   Mechanicville, NY 12118

   Nolan & Heller                                    $12,685
   39 North Pearl Street
   Albany, NY 12207

   National Grid                                     $12,246
   300 Erie Boulevard West                           
   Syracuse, NY 13202

   Kone                                              $5,306

   Barrier Free Elevators                            $5,010

   Jenkins Beecher & Bethel                          $5,000

   Lapans                                            $2,512

   Napaul Publishers                                 $1,942

   Conover Electric                                  $1,488

   Just Service                                      $1,434

   MVP Healthcare                                    $1,295

   Eagle, The                                        $1,121

   International Built-in Systems Inc.               $759

   NAPA                                              $741
                                                     
   Northeast Fire Protection                         $706

   Bain, Catherine                                   $705

   Aubuchon Hardware                                 $618


SCOTTISH RE: A.M. Best Chips Issuer Credit Rating to bb from bbb-
-----------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to
B(Fair) from B+(Good) and the issuer credit ratings to "bb" from
"bbb-" of the primary operating insurance subsidiaries of Scottish
Re Group Limited.  A.M. Best also has downgraded the ICR to
"b-"from "bb-" and the various debt ratings of Scottish Re.  The
outlook for all ratings is negative.

These rating actions are based on A.M. Best's opinion that
continuing market deterioration in the subprime mortgage loan
market will result in additional delinquencies and losses and that
the uncertainty surrounding the ultimate impact of investment
write-downs on Scottish Re, its subsidiaries and special purpose
vehicles such as Ballantyne Re are not appropriate for "Secure"
FSRs.  The rating downgrades also reflect A.M. Best's concerns
with the ongoing pricing, volatility, valuation and default risk
in the mortgage-backed securities market, which could result in
substantial negative impact on the company's consolidated balance
sheet.

A.M. Best notes that Scottish Re remains heavily dependent upon
off-shore securitizations for its XXX reserves.  While a majority
of Scottish Re's XXX reinsurance structures are bankruptcy remote,
an additional rating concern is the deterioration in the market
value of the underlying collateral, which reduces the amount
available to fund future reserve increases.  Large write-downs on
subprime loans held in the SPV's investment portfolio could
potentially deplete the capital held within those structures.  If
any deficiency were to develop, Scottish Re's operating
subsidiaries may be required to pledge additional assets to secure
reserve credit outside of the securitization structure.

Given the increased risk commonly associated with lower rated
companies, A.M. Best has widened the notching for its debt ratings
and downgraded the senior debt.

The FSR has been downgraded to B(Fair) from B+(Good) and the ICRs
to "bb" from "bbb-" for these subsidiaries of Scottish Re Group
Limited:

  --  Scottish Annuity & Life Insurance Company (Cayman) Ltd.
  --  Scottish Re (U.S.), Inc.
  --  Scottish Re Life Corporation
  --  Scottish Re Limited
  --  Orkney Re, Inc.

The ICR has been downgraded to "b-" from "bb-" for Scottish Re
Group Limited.

These debt ratings have been downgraded:

Scottish Re Group Limited  --
  --  to "ccc" from "b" on $125 million non-cumulative preferred
      shares

Stingray Pass-thru Trust  --
  --  to "bb" from "bbb-"on $325 million 5.902% senior secured
      pass-thru certificates, due 2012

These indicative ratings for debt securities have been downgraded:

Scottish Re Group Limited  --
  --  to "b-" from "bb-"on senior unsecured debt
  --  to "ccc+" from "b+" on subordinated debt
  --  to "ccc" from "b" on preferred stock

  --  Scottish Holdings Statutory Trust II and III  --
  --  to "ccc+" from "b+" on preferred securities


SEVERNA PARK: Case Summary & 17 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Severna Park Photo, Inc.
        551-C Baltimore-Annapolis Boulevard
        Severna Park, MD 21146

Bankruptcy Case No.: 08-12613

Type of Business: The Debtor offers printing services.
                  See: http://www.severnaparkphoto.com/

Chapter 11 Petition Date: February 26, 2008

Court: District of Maryland (Baltimore)

Judge: James F. Schneider

Debtor's Counsel: Gary R. Greenblatt, Esq.
                   (grgreen@mehl-green.com)
                  Mehlman, Greenblatt & Hare, LLC
                  723 South Charles Street, Suite LL3
                  Baltimore, MD 21230
                  Tel: (410) 547-0300
                  Fax: (410)547-7474
                  http://www.mehl-green.com/

Estimated Assets: $100,000 to $500,000

Estimated Debts:  $1 million to $10 million

Consolidated Debtor's List of 17 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
   Wayne Gaver                                       $400,000
   15 Crestview Drive            
   Milton, PA 17847              

   Thomas Alban                                      $400,000
   441 Rivendell Lane            
   Severna Park, MD 21146        

   State of Maryland           2006 sales tax        $95,154
   Sales and Use Tax Division    
   301 W. Preston Street
   Room 409                           
   Baltimore, MD 21201

   Nikon, Inc.                                       $45,834

   Internal Revenue Service    withholding taxes     $33,521

   Bogen Photo Group                                 $23,024

   Fuji Photo Film USA, Inc.                         $13,107

   Eastman Kodak Co.                                 $10,716

   Bank of America                                   $9,596

   HBW Group                                         $8,540

   Capital-Gazette Newspaper                         $6,192

   Timothy M. Hickey           wages                 $5,873

   Care First Blue Cross Blue                        $4,977
   Shield of MD                 

   Catherine Ann Hickey        wages                 $4,594

   Marcy A.Kelly, CPA, PA                            $3,100

   Baltimore Gas & Electric                          $3,055

   Argraph Corporation                               $2,791


SHARPER IMAGE: Asks Court to Extend Schedules Filing Deadline to
-----------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
granted a request by Sharper Image Corp. to extend a deadline for
the Debtor to submit Schedules for an additional 15 days, or until
April 4, 2008.  

Judge Kevin Gross will consider the Debtor's request for a waiver
of the requirements to file the list of equity security holders on
March 7, 2008, at 1:00 p.m.

Under Section 521 of the Bankruptcy Code and Rule 1007 of the
Federal Rules of Bankruptcy Procedure, a debtor is required
to file a schedule of assets and liabilities; schedule of current
income and expenditures; schedule of executory contract and
unexpired leases; and statement of financial affairs within 15
days after it filed for bankruptcy.

Rule 1007-1(b) of the Local Rules of Bankruptcy Practice and
Procedure of the United States Bankruptcy Court for the District
of Delaware provides that a debtor with over 200 creditors is
given 30 days to file its schedules.

Sharper Image asked the Court to extend the 30-day period to 60
days, without prejudice to the Debtor's ability to request
additional time should it become necessary.

Proposed counsel for the Debtor, Steven K. Kortanek, Esq., at
Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware,
stated that the Debtor needs until May 19, 2008, to submit its
Schedules.

Mr. Kortanek asserted that the 60-day extension is justified on
the grounds that:

   -- resources are strained;

   -- in view of the amount of work entailed in completing th
      Schedules and the competing demands on the Debtor's
      employees to assist in efforts to stabilize business
      operations during the initial postpetition period, the
      Debtor likely will not be able to properly and accurately
      complete the Schedules within the 30-day time period;   

   -- the task of completing the schedules takes a significant
      amount of time and effort on the employees; and

   -- there is a large amount of information to be compiled and
      assembled.

The Debtor also asked the Court to waive the requirement that it
file a list of equity security holders within 15 days of the
Petition Date.

As of the Petition Date, the Debtor has approximately 15,172,523
shares of common stock outstanding.

Mr. Kortanek noted that preparing a list of the equity security
holders and sending of notice to all holders of the 15,172,523
shares is expensive and time consuming.  Moreover, the equity
security holders change on a daily basis.

If it becomes necessary for the equity security holders to file
proofs of interest, they will be provided with notice of the bar
date and then will have an opportunity to assert their interests
-- and therefore, will not be prejudiced, Mr. Kortanek says.  


SHARPER IMAGE: Court Grants Request to Pay Vendor Obligations
-------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
granted a request by Sharper Image Corp. to pay its Vendor
Obligations in the ordinary course of business

The Debtor relies on providers of goods including, but not
limited to, manufacturers and suppliers, as well as packagers,
transporters, and product servicers, according to the Debtor's
proposed counsel, Steven K. Kortanek, Esq., at Womble Carlyle
Sandridge & Rice, PLLC, in Wilmington, Delaware.
        
Shipment and servicing of the Debtor's products from Vendors to
the Debtor's warehouse and distribution facilities in California
and Arkansas, as well as shipment of the Debtor's products to its
stores, and retail and wholesale customers is typically
effectuated through the services of common carriers, customs
brokers, freight forwarders and third parties that service and
repair certain of the Debtor's goods, Mr. Kortanek noted.
        
As of the Debtors' bankruptcy petition, and in the ordinary course
of business, the Debtor had approximately $113,000,000 of purchase
orders outstanding with various manufacturers and suppliers, as
well as packagers, transporters and product servicers for goods
ordered prior to the Petition Date, and delivered postpetition.
        
Mr. Kortanek explained that as a result of the Debtor's Chapter
11 case, Vendors may be concerned that the goods and services
provided to the Debtor prior to the Petition Date, but delivered
after the Petition Date, will make them general unsecured
creditors of the Debtor's estate.  
        
There is the possibility, Mr. Kortanek said, that the Vendors may
refuse to ship or transport goods or perform services with
respect to the Outstanding Orders, unless the  Debtor (i) issues
substitute postpetition purchase orders, (ii) obtains a Court
order granting all undisputed obligations of the Debtor arising
from its postpetition receipt and acceptance goods and services
subject to Outstanding Orders administrative expense priority
status, (iii) obtains the Court's authority to satisfy the
Undisputed Obligations, in the ordinary course of business.
        
                   Custom Duties and Other Fees
        
Mr. Kortanek related that the Debtor imports approximately
$75,000,000 to $175,000,000 of goods per quarter.  Furthermore,
the Debtor engages V. Alexander & Co., a Custom Broker, and
Panalpina Group, an import Freight Forwarder, to take all actions
necessary, including making payment, to obtain the release of
imported surcharged goods for delivery to the Debtor.
        
As of the Petition Date, the Debtor estimates that it owes
Alexander & Co. approximately $2,000, while Panalpina is owed
roughly $250,000.  Mr. Kortanek pointed out that prompt payment
to these entities are vital to the Debtor's operations.
        
The Debtor estimates that, as of the Petition Date, approximately
$2,700,000 of imported goods have been paid for, and are either
awaiting transit or are in transit to the U.S., all of which must
be processed by Alexander & Co. or Panalpina.
        
Prompt payment of the Customs Duties and other fees promotes the
uninterrupted flow of retail products, which are essential to the
Debtor's business, Mr. Kortanek maintained.
        
               Common Carriers and Product Servicers
        
The Debtor's catalog and Internet sales are dependent on common
carriers to ensure delivery of its customer orders, Mr. Kortanek
told Judge Gross.
        
As of the Petition Date, the Debtor owes approximately $850,000
to Common Carriers that are in possession of around $2,200,000 of
the Debtor's goods.  Furthermore, the Debtor also owes roughly
$415,000 to Product Servicers who are in possession of in excess
of $1,350,000 worth of the Debtor's goods.
        
To avoid disruptions to the continuous and timely flow of
products from the Vendors to the Debtor, which could result in
insufficient goods with which to provide customers with the
products they expect, the Court, at the Debtor's behest:
        
   * granted the Vendors administrative expense priority status
     for undisputed obligation arising from the postpetition
     delivery of goods and services ordered in the prepetition
     period;  
        
   * authorized the Debtor to pay its Vendor Obligations in the
     ordinary course of business;
        
   * authorized the Debtor to pay all undisputed prepetition
     customs duties, broker's fees, freight forward charges,
     ocean freight charges, common carrier charges and product
     servicer charges, for an amount not exceeding $1,500,000,
     without further Court order; and
        
   * authorized the Debtor's banks to receive, process, honor and
     pay checks related to the undisputed prepetition
     obligations.
        
Furthermore, upon the Debtor's payment of any undisputed
prepetition obligation, any property held by any Vendor as
security for the payment will be immediately released and
delivered by the Vendor to its destination as directed by the
Debtor.


SHILOH'S INDUSTRIES: Moody's Holds Ba3 Rating With Stable Outlook
-----------------------------------------------------------------
Moody's Investors Service affirmed Shiloh's Industries, Inc.'s
existing ratings, including its Ba3 Corporate Family Rating.  The
ratings outlook remains stable.

Shiloh's Ba3 Corporate Family Rating continues to be constrained
by its relatively small revenue size within the highly fragmented
auto supplier industry, continued weakness within the auto
industry, high concentration with the Big Three U.S. automakers,
adequate liquidity, and lack of material geographic
diversification.  With the recent announcement of the $16 million
special dividend, Moody's notes that the company's financial
policy has become more aggressive with two special dividend
payments in as many years.  Despite this and the moderate increase
in financial leverage resulting from the recent $16 million
special dividend announcement, the Ba3 rating was affirmed.

Positive factors incorporated in the Corporate Family Rating
include consideration of the company's sustained leading position
within the engineered welded blanks space, its history of debt
repayment and stable free cash flow.  Although the special
dividend increases the company's leverage position, Moody's
expects that Shiloh's operating performance should provide
sufficient ability to reduce debt in the medium term.  Sidney
Matti, Analyst, stated that, "Despite the expectation for
continued weakness within the automotive sector, Shiloh has
demonstrated its willingness and ability to repay debt resulting
in Moody's anticipation of improving credit metrics over the
intermediate term."

The stable outlook reflects Moody's expectation for Shiloh's
continued deleveraging and stable cash flow generation over the
intermediate term in the face of a sustained decline in the auto
industry.  Tightening of the company's liquidity profile or the
absence of meaningful and sustained reduction in financial
leverage could result in negative pressure on the outlook or
ratings.  Additionally, negative pressure could result from a more
pronounced and steeper than expected decline in the auto industry.

These ratings were affirmed:

  -- Ba3 Corporate Family Rating;

  -- B1 Probability of Default Rating;

  -- Ba2 (to LGD2/22% from LGD2/24%) rating on the $125 million
     Senior Secured Revolver; and

  -- Ba2 (to LGD2/22% from LGD2/24%) rating on the $50 million
     Senior Secured Term Loan.

Headquartered in Cleveland, Ohio, Shiloh Industries, Inc. is a
manufacturer of first operation blanks, engineered welded blanks,
complex stampings and modular assemblies for the automotive, heavy
truck and other industrial markets.  For the twelve months ended
Jan. 31, 2008, the company reported approximately $578 million in
revenues.


SIRVA INC: Obtains Additional $10 Million DIP Loan; Panel Objects
-----------------------------------------------------------------
The Honorable James M. Peck of the U.S. Bankruptcy Court for the
Southern District of New York gave interim permission to SIRVA
Inc. and its debtor-affiliates to obtain $10,000,000 on top of the
$100,000,000 that was authorized in the Court's interim order
dated Feb. 5, 2008.

According to Marc Kieselstein, P.C., at Kirkland and Ellis LLP in
Chicago, Illinois, a creditors committee was formed on Feb. 20,
2008.  To give the Official Committee of Unsecured Creditors
sufficient time to evaluate the DIP Motion, the Debtors agreed to
continue the Final DIP Hearing to February 28.

"[T]he Debtors require an additional $10 million in funding over
the initial $100 million amount authorized by the Interim DIP
Financing Order to ensure sufficient liquidity during the
additional four days before the Court can consider granting final
relief," Mr. Kieselstein informed the Court.

Without the additional liquidity, Mr. Kieselstein said, the
Debtors may encounter additional difficulties in meeting certain
critical cash needs, and subsequently cause an adverse impact on
the Debtors' business operations and delay their Plan of
Reorganization.

The Creditors Committee did not object to the request for interim
financing.

                       Triple Net Objects

Triple Net Investments IX, LP, holds a claim against one of the
Debtors, North American Van Lines, Inc., for $2,021,546, of which
$89,624 is an administrative claim for the February 2008 rent
under a non-residential real property lease between Triple Net
and North American.

According to Triple Net, the DIP Motion works as a de facto
substantive consolidation of the Debtors' assets, to secure the
proposed $150,000,000 DIP financing, to cross collateralize SIRVA
Worldwide, Inc.'s pre- and postpetition lender obligations, and
to collateralize exit financing.

Triple Net said it was denied recourse to a substantial
unencumbered asset base, which it submits had been available
prepetition to satisfy its claims against North American by the
removal from North American's reach valuable North American
solvent, non-debtor, foreign subsidiaries.

Triple Net noted that the DIP Motion estimates the revenues of
North American's subsidiaries to be $36,000,000 at September 30,
2007.  Part of North American's equity in its subsidiaries was
unencumbered by Debtors' obligations to prepetition secured
lenders.  Without discovery, Triple Net said, similar creditors
including itself, as well as the Court, are "operating in the
dark."

Triple Net stated that the DIP Motion had also sought a
$65,000,000 postpetition transfer to the Prepetition Secured
Lenders, and that the transfer is preferential and was made in
bad faith, since the Debtors should have known that Prepetition
Secured Lenders were grossly undersecured when the prepetition
loan was made.  According to Triple Net, it was in fact an
unsecured loan that was paid postpetition.

Triple Net added that the the DIP Motion appears to be an integral
component of a "prepackaged" plan of reorganization, which the
Debtors are pushing through the confirmation process.

Like the DIP Motion, the Plan, has as its "lynch-pin" the
substantive consolidation of the Debtors' assets and liabilities,
including those unencumbered assets of North American, Triple Net
contended.

Triple Net pointed out that the Plan provides for a zero
distribution for general unsecured creditors like itself, while
giving full payment to those that the Debtors elect to pay,
either in the ordinary course of business or in full upon
confirmation of the Plan.

Triple Net asserted that if the Court approves the DIP Motion, it
will be prejudiced because North American, through its
subsidiaries, are solvent, and therefore able to pay Triple Net's
claim in full.

Triple Net accordingly sought a reconsideration of the interim
relief which the Court had granted to the Debtors.  It also asked
the Court to deny the final relief sought by the DIP Motion, and
to direct the Prepetition Secured Lenders to disgorge the
$65,000,000 postpetition transfer.

                         Debtors Respond

Mr. Kieselstein told Judge Peck that Triple Net has not provided
any justification for the Court to reconsider the Interim DIP
Order, and provides no legal arguments that rebut the Court's
ruling, other than its incorrect assertion that the loans were
unsecured.  He argued that the loans, refinanced under the
Interim DIP Order, were entitled to priority over other
prepetition facility claims, and are thus fully secured.

The argument that the DIP Motion works as a de facto substantive
consolidation is meritless, according to Mr. Kieselstein, since
the DIP Facility mirrors the guarantee and security interest of
the prepetition senior secured facility -- overlapping guarantees
and security interests in the Debtors' assets.  Hence, the DIP
facility has a structure essentially identical to the Prepetition
Facility, with extra collateral to secure the additional
$35,000,000 in funds, advanced to the Debtors.

As a result, Mr. Kieselstein explained, the Debtors were not
required to notify Triple Net of the DIP Motion, since the
service provided was adequate under Rules 4001 and 9014 of the
Federal Rules of Bankruptcy Procedure, and Triple Net was not
directly affected by the DIP Motion.

                Committee Objects to DIP Facility

The Committee objects to the entry of a final order on the DIP
Motion because:

    (i) the DIP Financing appears to be unnecessary, since the
        Debtors could operate on a cash collateral basis; and

   (ii) the DIP Financing is an attempt by the Debtors'
        Prepetition Secured Lenders to gain inappropriate
        leverage over the Committee concerning an "inevitable
        plan fight."

According to the Committee, the Debtors suggested a lack of
significant opposition to its Plan, and relied on this "global
harmony" to obtain relief for its first-day motions.

The Committee maintains that the Plan is not consensual.  The
Committee does not support the Plan because, unlike typical
prepackaged plans, the Debtors propose to pay nothing to general
unsecured creditors.  With regard to the Debtors' assertion that
the Plan is supported by "all classes entitled to vote," it is
only because holders of Class 5 Claims are deemed to reject the
Plan, and are not entitled to vote.

The Committee believes that the Plan cannot be confirmed because
in addition to discrimination issues, there appear to be holes in
the Prepetition Secured Lenders' collateral position.  It asserts
that the Class 5 Claimants are as entitled as the other unsecured
claimholders to reap the value of unencumbered assets.

The Debtors and the Prepetition Secured Lenders have sought to
rectify the problem by the superpriority $150,000,000 DIP
Financing.  However, the Committee says, the Lenders have used
the DIP Financing to gain an advantage over the Class 5 Claimants
since all of its proceeds are used:

   -- to satisfy prepetition claims, of which more than half are
      owed to the Lenders, and

   -- to pay interest and fees to the Lenders.

The Committee maintains that the Debtors have not presented any
meaningful evidence that they could not operate postpetition on a
cash collateral basis, as long as they do not use the cash
collateral to pay prepetition claims or other payments to their
Prepetition Secured Lenders.

According to the Committee, some of the most problematic aspects
of the DIP Financing are:

   (a) $65,000,000 is used simply to repay the Prepetition
       Secured Lenders, without demonstrating that the payment
       benefits the Debtors' estates;

   (b) the premise of the Plan is that the Lenders' claims are
       undersecured, but the Debtors propose to use the DIP
       Financing proceeds for ongoing interest and expense
       payments, in violation of Section 506 of the Bankruptcy
       Code;

   (c) certain Debtors are not obligated on the prepetition debt,
       but become obligated to repay the DIP Financing;

   (d) the Committee is given a short investigation period of
       until March 11, 2008, and a limited funding of $50,000 or
       $833 per Debtor, to investigate the validity of the
       Lenders' liens and possible claims that the 61 Debtors may
       have against the Lenders;

   (e) the Lenders improperly take a lien on proceeds of
       avoidance actions;

   (f) the Lenders seek a surcharge waiver under Section 506(c),
       which is inappropriate under the DIP Financing
       circumstances;

   (g) the Lenders seek a prohibition on marshalling, which is
       improper given the unfairness of imposing obligations on
       Debtors not obligated on the Prepetition Debt; and

   (h) the DIP Financing attempts to impose burdens on the
       Committee for the sole reason of impeding its statutory
       duties, by the provision that the Committee has no
       standing to bring claims against the Lenders without
       permission from the Court.

The Committee submits that a Court should approve a proposed DIP
Financing only if it is in the best interest of the general
creditor body, citing In re Roblin Industries, Inc., 52 B.R. 241,
244 (Bankr. W.D.N.Y. 1985).

The Committee asks the Court to deny the final approval of the
DIP Financing, and to terminate the Debtors' ability to borrow
until payments to the Lenders are reversed.

                       About Solutia Inc.

Solutia Inc. (NYSE:SOA-WI) -- http://www.solutia.com/--  
is a performance materials and specialty chemicals company.  The
company focuses on providing solutions for a better life through a
range of products, including Saflex(r) interlayer for laminated
glass, CPFilms(r) aftermarket window films, high-performance nylon
polymers and fibers sold under brands including Vydyne(r) and
Wear-Dated(r), Flexsys(r) chemicals for the rubber industry, and
specialty products such as Skydrol(r) aviation hydraulic fluid
and Therminol(r) heat transfer fluid.  Solutia's businesses are
world leaders in each of their market segments. With its
headquarters in St. Louis, Missouri, USA, the company operates
globally with approximately 6,000 employees in more than 60
countries that includes Malaysia, China, Singapore, Belgium, and
Colombia.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed US$2,854,000,000 in assets and
US$3,223,000,000 in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis
LLP, in New York, as lead bankruptcy counsel, and David A.
Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders
LLP, in St. Louis Missouri, as special counsel.  Trumbull Group
LLC is the Debtor's claims and noticing agent.  Daniel H.
Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq.,
at Akin Gump Strauss Hauer & Feld LLP represent the Official
Committee of Unsecured Creditors, and Derron S. Slonecker at
Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice.  The Official Committee of
Retirees of Solutia, Inc., et al., is represented by Daniel D.
Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq.,
at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and
Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott
Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in
Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Court approved the Debtors' amended
Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007, the
Debtor re-filed a Consensual Plan & Disclosure Statement and on
Nov. 29, 2007, the Court confirmed the Debtors' Consensual Plan.

(Sirva Inc. Bankruptcy News, Issue No. 6; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000).


SOLIDUS NETWORKS: Auction of Three Non-Core Businesses Adjourned
----------------------------------------------------------------
The auction of Solidus Networks Inc.'s under-performing assets,
originally scheduled to commence on Feb. 21, 2008, was suspended
for undisclosed reasons, Digital Transactions News says.

As reported in the Troubled Company Reporter on Feb. 22, 2008, the
Hon. Thomas B. Donovan of the U.S. Bankruptcy Court for the
Central District of California was set to conduct a hearing on
Feb. 25, 2008, at 9:30 a.m., to consider the sale of three
non-performing business units owned by Solidus Networks Inc., dba
Pay By Touch, and its debtor-affiliates.

The sale hearing was to be held at Courtroom 1352, 255 East Temple
Street in Los Angeles, California.

An auction for the Pay By Touch Payment business was originally
scheduled for Feb. 21, 2008, at the office of the Debtors'
counsel, Hennigan, Bennett, Dorman LLP in Los Angeles.  An auction
for the ATM Direct and Pay By Check Secure businesses was to be
held the following day at the same venue.

Judge Donovan has approved bidding procedures intended to maximize
the value of the Debtors' assets.  Bids for any of the three
businesses were supposed to be due February 19.

Digital Transaction said that the Debtor calls its Pay By Touch
Payment, ATM Direct and Pay By Check Secure businesses as non-core
assets, while its Biometric business is its core-assets.

                   About Solidus Networks Inc.

Headquartered in Culver City, California, Solidus Networks Inc.,
dba Pay By Touch, -- http://www.paybytouch.com/-- is a biometric    
authentication, personalized marketing and payment solutions.  To
date, patented Pay By Touch(TM) biometric services have enabled
over 4 million shoppers in the U.S., Europe and Asia to quickly
and securely use a finger scan to access personalized offers, make
purchases, and cash checks at more than 2,600 locations
nationwide.  Founded in 2002, Pay By Touch holds more than 60
issued patents and 175+ pending patents worldwide on secure,
convenient and cost-effective transaction solutions.  

Gregg Eyman, James C. Lee and Laura Schoep Lee filed an
involuntary Chapter 11 petition against the company on Oct. 31,
2007, (Bankr. C.D. Calif. Case Number. 07-20027)  Robert M.
Yaspan, Esq. of the Law Offices of Yaspan & Thau, represents the
petitioners.

On Dec. 14, 2007, the Debtors gave their consent to the entry of
an order for chapter 11 bankruptcy relief.  That order was entered
by the Hon. Thomas B. Donovan on Dec. 17, 2007.  Bruce Bennett,
Esq., James O. Johnston, Esq., and Lance Miller, Esq., at
Hennigan, Bennett & Dorman LLP, represent the Debtor in its
restructuring efforts.  The Debtors' schedules show total assets
of $75,698,454 and total liabilities of $330,618,305.

The United States Trustee for Region 16 has established a four-
member official committee of unsecured creditors in the Debtors'
cases.  Stutman Treister & Glatt PC represents the Official
Committee of Creditors Holding Unsecured Claims.


SPRINT NEXTEL: Reports $29.5 Billion Net Loss in 4th Quarter 2007
-----------------------------------------------------------------
Sprint Nextel Corp. reported net loss of $29.5 billion compared
to net income of $261 million in the fourth quarter a year ago,
according to the company's regulatory filing with the Securities
and Exchange Commission dated Feb. 28, 2008.

In the quarter, the company recorded a non-cash goodwill
impairment charge of $29.7 billion.  the company's consolidated
net operating revenues in the quarter were $9.8 billion, compared
to $10.4 billion in the fourth quarter of 2006.  Full-year 2007
revenues were $40.1 billion versus $41.0 billion in 2006.

After adjusting for the goodwill impairment charge, as well as
the effects of other special items and merger-related amortization
costs, Adjusted EPS before Amortization*was 21 cents in the fourth
quarter of 2007, compared to 29 cents in the fourth quarter of
2006. T he decline in earnings is due to a reduced contribution
from Wireless, partially offset by an improved contribution from
Wireline, an investment gain and an income tax benefit in the
fourth quarter of 2007.

As previously reported, wireless subscribers declined 108,000 in
the fourth quarter, due to gains in wholesale and Boost Unlimited
subscribers offset by decreases in iDEN post-paid and traditional
Boost pre-paid users.  For the quarter, post-paid churn was 2.3%,
matching the third quarter of 2007 and the fourth quarter of 2006.
Wireless post-paid ARPU in the quarter was a little more than $58,
a 1% sequential decline and a 4% decrease compared to the fourth
quarter of 2006. ARPU continues to be pressured by lower voice
contributions, partially offset by growth in data services.

"The fourth quarter financial results reflect the challenges
facing our Wireless business," said Dan Hesse, Sprint Nextel CEO.
"We are making significant changes across the organization in an
effort to improve execution, stabilize our customer base and
deliver on the opportunity provided by our assets.

Given current deteriorating business conditions, which are more
difficult than what I had expected to encounter, these changes
will take time to produce improved operating performance, and our
near-term subscriber and financial results will continue to be
pressured. Additionally, in light of current capital market
conditions, we are taking steps to increase our financial
flexibility and mitigate refinancing risk by borrowing funds from
a revolving credit facility and discontinuing declaring a dividend
for the foreseeable future.

"Internally, we have rolled out a unified company culture focused
on accountability and on providing a superior customer experience.
We plan to share some of our initiatives for improving the
customer experience and operations next quarter.  Strategic
assessments and changes may take longer to complete," Hesse said.

                     Revolving Credit Facility

On Feb. 27, 2008, Sprint Nextel borrowed $2.5 billion in principal
amount under its revolving credit facility.  The company has no
immediate need for additional liquidity, but in light of current
market conditions borrowed the funds to provide greater financial
flexibility and to mitigate any potential financing risk related
to $1.25 billion in bonds that mature in November 2008, as well as
the approximately $400 million outstanding under our commercial
paper program, and $600 million of bonds that mature in May, 2009.

The company has no other material refinancing scheduled until
2010.  About $500 million of borrowing capacity remains available
under the revolving credit facility.

A full-text copy of Sprint Nextel's Fourth Quarter and Full-Year
2007 Results at http://ResearchArchives.com/t/s?289b

                      About Sprint Nextel

Sprint Nextel Corp. -- http://www.sprint.com/-- offers a  
comprehensive range of wireless and wireline communications
services bringing the freedom of mobility to consumers, businesses
and government users.  Sprint Nextel is widely recognized for
developing, engineering and deploying innovative technologies,
including two robust wireless networks serving about 54 million
customers at the end of the fourth quarter 2007; industry-leading
mobile data services; instant national and international walkie-
talkie capabilities; and a global Tier 1 Internet backbone.


SPRINT NEXTEL: Expected Bad Fin'l Results Cue Fitch to Cut Ratings
------------------------------------------------------------------
Fitch Ratings has downgraded and placed on Rating Watch Negative
the ratings for Sprint Nextel Corporation and its subsidiaries as:

Sprint Nextel Corporation (Sprint Nextel)
  -- Issuer Default Rating to 'BB+' from 'BBB-';
  -- Senior unsecured notes to 'BB+' from 'BBB-';
  -- Short-term IDR to 'B' from 'F3';
  -- Commercial paper to 'B' from 'F3'.

Sprint Capital Corporation
  -- IDR to 'BB+' from 'BBB-';
  -- Senior unsecured notes to 'BB+' from 'BBB-';

Nextel Communications Inc. (Nextel)
  -- IDR to 'BB+' from 'BBB-';
  -- Senior unsecured notes to 'BB+' from 'BBB-';

US Unwired Inc (US Unwired)
  -- IDR to 'BB+' from 'BBB-';
  -- Second priority secured notes to 'BB+' from 'BBB-'.

Alamosa Delaware Inc. (Alamosa)
  -- IDR to 'BB+' from 'BBB-';
  -- Senior unsecured notes to 'BB+' from 'BBB-'.

The downgrade reflects Fitch's expectations that the company's
financial metrics and operating results for 2008 will be
significantly worse than expected.  Fitch had downgraded Sprint
ratings to 'BBB-' in January and had assigned a Negative Rating
Outlook at that time.  The Negative Outlook reflected the weaker
operating trends and the potential that further erosion could
occur to Sprint's operations if the company remained unsuccessful
in stabilizing its business.  If it became apparent credit metrics
would further erode materially from the 2.5 times range, Fitch
would take further rating actions.

Based on the guidance Sprint released on their earning call this
morning, postpaid net addition losses are now expected to be
approximately 1.2 million for the first quarter.  In addition,
it's likely the subscriber losses would not improve materially in
the second quarter.  Particularly concerning, Sprint will now
begin to experience erosion to its CDMA subscriber base absent
transfers from the iDEN network.  These negative trends coupled
with the positive momentum by Verizon Wireless and AT&T Wireless
heightens the challenge that Sprint Nextel faces in turning around
its operating results.  

Fitch believes the company will experience significant
difficulties in increasing its mix of prime subscribers given the
high industry penetration rates, the past customer service issues,
the low postpaid churn rates of its national competitors, the
slowing economy and its competitive position.  Accordingly, Fitch
estimates that Sprint Nextel's postpaid gross additions decreased
by 12% in the fourth quarter and Fitch expects further pressure
during 2008.  Fitch also notes Sprint Nextel experienced
additional ARPU pressure due to mix changes and lower overage with
expectations for further declines during 2008.

Sprint announced the company drew down $2.5 billion on its credit
facility to reduce refinancing risk over the next 18 months.  At
the end of the fourth quarter, Sprint had $400 million on
commercial paper, $1.3 billion in debt coming due in November 2008
and $600 million in May 2009.  Fitch expects Sprint Nextel to pay
down its commercial paper over the upcoming months leaving the
company with approximately $900 million availability on its
$6 billion credit facility that matures in December 2010.  Sprint
also took actions to suspend its common dividend of approximately
$300 million annually.

Fitch expects to resolve the Rating Watch Negative over the next
several weeks pending a more detailed review and analysis of
Sprint Nextel's expected operating and financial performance for
2008.  Fitch expects any further potential downgrades to be
limited to one notch.


SPRINT NEXTEL: Moody's Give Negative Outlook on Weak Operations
---------------------------------------------------------------
Moody's Investors Service affirmed Sprint Nextel's existing
ratings, including the company's Baa3 senior unsecured and Prime-3
commercial paper ratings, but changed its rating outlook to
negative from stable.

The rating affirmation reflects Sprint's ongoing ability to
generate significant free cash flow from its valuable wireless and
wireline assets, its strong balance sheet, ample liquidity, its
conservative approach to managing its financial flexibility and
refinancing needs and Moody's expectations that the company's new
management team can be successful in improving operating
performance.

Moody's changed Sprint Nextel's rating outlook to negative from
stable due to the rating agency's view that operational weakness
(generally resulting from poor customer service) will persist
longer and be more pronounced than previously expected causing
subscriber losses to increase, at least in the near-term, rather
than decline.

For the past several quarters, lingering operational difficulties
and strong competitive challenges have resulted in Sprint Nextel
experiencing high churn, declining ARPU, loss of market share and
margin pressure in its post-paid business.  These trends persisted
during the 4Q '07 as Sprint Nextel announced a decline of 683K
post-paid subscribers and lost traditional pre-paid customers
(202K).  While Moody's had expected the company's subscriber base
to continue shrinking in the first half of 2008, Moody's
previously believed that various operational initiatives would
slow the rate of decline.  That seems unlikely now and subscriber
losses are expected to increase substantially, at least during the
first half of the year.

In addition, economic weakness and heightened competitive
challenges from the large national providers (i.e. AT&T Mobility,
Verizon Wireless and T-Mobile) and all-you-can-eat carriers (i.e.
Metro PCS and Leap) will make it more difficult and time consuming
for Sprint Nextel to stabilize its performance.  Consequently,
Moody's expects the company's revenue and EBITDA base to weaken
and lead to deterioration in credit metrics.

Moody's notes that the company is undertaking various steps
designed to support its financial profile in light of ongoing
operational weakness.  The company suspended its dividend and did
not complete a previously announced share repurchase program.  In
addition, the company has drawn down $2.5 billion of its revolver
and now has almost $5.0 billion of cash on hand to meet about
$2.3 billion of upcoming maturities through 2009.  At this point
in time, Moody's believes that the company will maintain an
adequate cushion under its credit facility which contains a 3.5x
maximum debt to EBITDA maintenance covenant.  However, the cushion
could become tight by year-end if the company's operating
performance remains weak.

The rating could be placed on review for possible downgrade if
post-paid subscriber losses approach 1.5 million in 1Q'08 or if
EBITDA declines more than 15% from 4Q'07 to 1Q '08.

Sprint Nextel Corporation, with headquarters in Overland Park,
Kansas, is one of the largest telecommunications companies in the
United States.  It offers digital wireless services under the
Sprint master brand name in addition to a broad suite of wireline
communications services.  The company operates two wireless
networks, one based on CDMA technology and the other over the
former Nextel Communication's iDEN network.


SPRINT NEXTEL: Losses Cues S&P to Put Ratings on Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BBB-' corporate
credit rating and all other ratings on Sprint Nextel Corp. on
CreditWatch with negative implications following the company's
announcement that it expects to report EBITDA of $1.8 billion to
$1.9 billion in the first quarter of 2008 because of post-paid
subscriber losses, which are expected to be around 1.2 million and
are unlikely to improve in the second quarter.
      
"The erosion in Sprint Nextel's subscriber base and the resultant
decline in EBITDA are substantially higher than we anticipated and
the company's business profile is probably no longer supportive of
an investment-grade rating," said Standard & Poor's credit analyst
Allyn Arden.     

Additionally, Sprint Nextel said it will draw $2.5 billion of the
approximately $3 billion available under its $6 billion revolving
credit facility to mitigate potential refinancing risk related to
the $1.25 billion in bonds that mature in November 2008, as well
as about $400 million outstanding under its commercial paper
program, and $600 million of bonds that mature in May 2009.
     
While Sprint Nextel cited concerns about capital market conditions
over the next year, S&P believes that a near-term degradation in
the business, beyond our original expectations, coupled with the
higher interim debt levels, could narrow the cushion under the
senior unsecured credit facility, which contains a 3.5x maximum
debt to EBITDA maintenance covenant.  In its fourth quarter
conference call, the company noted that under its current view, it
expects to be in compliance with covenants.  However, management
is still reviewing its 2008 budget and we will need to get more
clarity regarding its ability to maintain a reasonable cushion,
especially at the EBITDA run-rate implied by the first quarter
2008 guidance.
     
S&P will resolve the CreditWatch listing following discussions
with management regarding its expectations for the next couple of
years, as well as its strategy to improve operations, and its
ability to comfortably maintain compliance under its covenants.  A
downgrade, if any, could exceed one notch.


SOLIDUS NETWORKS: No Qualified Offers Obtained to Buy Core Assets
-----------------------------------------------------------------
Restructuring expert Thomas Lumsden cited in a court document that
until present time, no purchaser has been found to buy the assets
of Solidus Networks Inc., dba Pay By Touch, Digital Transactions
News reports.  In December 2007, Mr. Lumsden was appointed to
manage the Debtor's operations while in bankruptcy, Digital
Transactions reports.  

Also in December 2007, the report relates that the Debtor engaged
Jefferies & Co. to market the Biometric Business.  Based on the
report, the investment firm notified about 90 buyers, around 40
asked for further details, but none gave a favorable offer by
Jan. 31, 2008.

The TCR reported on Feb. 22, 2008, that Solidus was permitted
permission to borrow up to $13.5 million in debtor-in-possession
financing from Plainfield Asset Management in Connecticut.  Under
the terms of the DIP loan agreement, the Debtors must reach a
binding sale agreement or effect a court-supervised sale of their
assets by Jan. 31, 2008.  That deadline was extended until
February 8, according to Digital Transactions.

In his declaration, Mr. Lumsden stated that there was no "binding
offer" to support a reorganization plan or sale of the Debtor's
assets as of the Feb. 8, 2008 extended deadline, set forth in the
DIP facility agreement, Digital Transaction says.

Hence, the Debtors have pursued to conduct an auction at his
suggestion, Digital Transaction quotes Mr. Lumsden as stating.

                    Sale of Biometric Business

The TCR related yesterday, Feb. 28, 2008, that the Court allowed
Solidus to auction its Biometric Payments and Personalized
Marketing Business, as well as stock and membership interests in
S&H Marketing Inc. and in in Loyalty Acquisition Sub LLC.

Pursuant to the terms of the bidding procedures order, the auction
of the assets will be conducted on March 5, 2008, 9:00 a.m. and
bids must be received before 5:00 p.m. today.  The sale hearing
for the sale of Biometric Payments and other assets will be held
on May 7, at 9:00 a.m.

Digital Transactions reveals that the Biometric Business was
unprofitable amid having countrywide presence in the U.S. with at
least 700 outlets.  Based on court documents, in 2007, Biometric
incurred a net loss of $137 million on $600,000 revenue, the
report says.

In 2007, S&H Marketing had a net income of $2.4 million on $36
million revenue, Digital Transactions relates.  S&H Marketing
services grocery stores handling about 500,000 deals everyday and
selling Greenpoints.

In 2007, Loyalty Acquisition, which develops customer
identification and loyalty programs, had a net loss of $2.5
million on $7.2 million revenue, based on the report.

                   About Solidus Networks Inc.

Headquartered in Culver City, California, Solidus Networks Inc.,
dba Pay By Touch, -- http://www.paybytouch.com/-- is a biometric    
authentication, personalized marketing and payment solutions.  To
date, patented Pay By Touch(TM) biometric services have enabled
over 4 million shoppers in the U.S., Europe and Asia to quickly
and securely use a finger scan to access personalized offers, make
purchases, and cash checks at more than 2,600 locations
nationwide.  Founded in 2002, Pay By Touch holds more than 60
issued patents and 175+ pending patents worldwide on secure,
convenient and cost-effective transaction solutions.  

Gregg Eyman, James C. Lee and Laura Schoep Lee filed an
involuntary Chapter 11 petition against the company on Oct. 31,
2007, (Bankr. C.D. Calif. Case Number. 07-20027)  Robert M.
Yaspan, Esq. of the Law Offices of Yaspan & Thau, represents the
petitioners.

On Dec. 14, 2007, the Debtors gave their consent to the entry of
an order for chapter 11 bankruptcy relief.  That order was entered
by the Hon. Thomas B. Donovan on Dec. 17, 2007.  Bruce Bennett,
Esq., James O. Johnston, Esq., and Lance Miller, Esq., at
Hennigan, Bennett & Dorman LLP, represent the Debtor in its
restructuring efforts.  The Debtors' schedules show total assets
of $75,698,454 and total liabilities of $330,618,305.

The United States Trustee for Region 16 has established a four-
member official committee of unsecured creditors in the Debtors'
cases.  Stutman Treister & Glatt PC represents the Official
Committee of Creditors Holding Unsecured Claims.


SOLIDUS NETWORKS: Whorl LLC Balks at Asset Sale and DIP Financing
-----------------------------------------------------------------
Whorl LLC, pursuant to Rule 8006 of the Federal Rules of
Bankruptcy Procedure, has taken an appeal from an interim order
authorizing Solidus Networks Inc., dba Pay By Touch, to obtain up
to $13.5 million in debtor-in-possession financing from Plainfield
Asset Management in Connecticut.

The interim order was entered by the U.S. Bankruptcy Court for the
Central District of California on Dec. 17, 2007.

In its statement of issues to be presented on appeal before the
U.S. District Court for the Central District of California, Whorl
also asked for the removal of Pay By Touch Checking Resources Inc.
from the case.

Whorl complained that the Bankruptcy Court erred in granting
adequate protection against PBT Checking and ATMD Acquisition
Corp., non-debtor entities.  Whorl said that the lenders hold no
interest in the assets of PBT Checking and ATMD since they are no
indebted to the lenders.  There is no need for adequate
protection, Whorl claimed.  Hence, PBT Checking must be removed
from the bankruptcy case, Whorl demands.

Whorl, successor to BioPay LLC, asserted that some of the
intellectual property included in the core-assets of PBT Checking
that Solidus wants to sell is part of BioPay, Digital Transactions
News reveals.

Whorl alleged that the debtor defaulted on its promissory notes,
including a $15 million cash, used to finance the sale of BioPay,
based on Digital Transaction's report.

Lee R. Bogdanoff, Esq., and Martin R. Barash, Esq., at Klee
Tuchin, Bogdanoff & Stern LLP serve as counsels for Whorl LLC.

                   About Solidus Networks Inc.

Headquartered in Culver City, California, Solidus Networks Inc.,
dba Pay By Touch, -- http://www.paybytouch.com/-- is a biometric    
authentication, personalized marketing and payment solutions.  To
date, patented Pay By Touch(TM) biometric services have enabled
over 4 million shoppers in the U.S., Europe and Asia to quickly
and securely use a finger scan to access personalized offers, make
purchases, and cash checks at more than 2,600 locations
nationwide.  Founded in 2002, Pay By Touch holds more than 60
issued patents and 175+ pending patents worldwide on secure,
convenient and cost-effective transaction solutions.  

Gregg Eyman, James C. Lee and Laura Schoep Lee filed an
involuntary Chapter 11 petition against the company on Oct. 31,
2007, (Bankr. C.D. Calif. Case Number. 07-20027)  Robert M.
Yaspan, Esq. of the Law Offices of Yaspan & Thau, represents the
petitioners.

On Dec. 14, 2007, the Debtors gave their consent to the entry of
an order for chapter 11 bankruptcy relief.  That order was entered
by the Hon. Thomas B. Donovan on Dec. 17, 2007.  Bruce Bennett,
Esq., James O. Johnston, Esq., and Lance Miller, Esq., at
Hennigan, Bennett & Dorman LLP, represent the Debtor in its
restructuring efforts.  The Debtors' schedules show total assets
of $75,698,454 and total liabilities of $330,618,305.

The United States Trustee for Region 16 has established a four-
member official committee of unsecured creditors in the Debtors'
cases.  Stutman Treister & Glatt PC represents the Official
Committee of Creditors Holding Unsecured Claims.


SOLUTIA INC: Gets Exit Financing; Emerges From Ch. 11 Protection
----------------------------------------------------------------
Solutia Inc. and its debtor-affiliates have emerged from Chapter
11 reorganization, pursuant to an agreement with their lenders who
will provide exit financing to the Debtors.

As reported in the Troubled Company Reporter on Feb. 26, 2008, the
Debtors  reached an agreement with Citigroup Global Markets Inc.,
Goldman Sachs Credit Partners L.P., and Deutsche Bank Securities
Inc. to fund Solutia's exit financing package and scheduled a
closing date on Feb. 28, 2008.

"Solutia has emerged as a well-positioned specialty chemicals and
performance materials company with market-leading global positions
and a diverse portfolio of high potential businesses," said Jeffry
N. Quinn, chairman, president and chief executive officer.  "We
believe we are a stronger, healthier and more competitive company
than at any point in our history.  Over the past four years, we
have transformed our portfolio through strategic acquisitions,
internal investments, asset dispositions, and the re-deployment of
significant nylon assets to higher-value uses."

During its time in Chapter 11, Solutia has diversified from both
an end-market and a geographic perspective.  In 2007, the
company's net sales from outside the United States were 55% of the
total revenue, compared to 39% in 2003.  The increase has been
driven primarily by Solutia's Asian growth strategy, as well as
significant growth in Europe.

"During this period, we have made great strides in improving our
financial position by reducing legacy liabilities, enhancing and
focusing the business portfolio and delivering strong revenue and
operating earnings growth and momentum," said James M. Sullivan,
senior vice president and chief financial officer.  "With a strong
balance sheet and more than 50% of our portfolio growing at
greater than two times global GDP, we believe we are positioned to
deliver increased shareholder value."

The U.S. Bankruptcy Court for the Southern District of New York
confirmed Solutia's plan of reorganization and approved the
company's exit from bankruptcy subject to certain conditions
including the funding of an exit financing facility on Nov. 29,
2007.  This exit financing is being used to pay certain creditors,
and for ongoing operations.

The new common stock of reorganized Solutia is scheduled to begin
trading on the New York Stock Exchange under the ticker symbol SOA
on Monday, March 3, 2008.  Currently the stock symbol also
includes the "WI" notation.

The "old" Solutia stock, which was trading over-the-counter under
the SOLUQ ticker symbol, together with warrants or options to
purchase old common stock, were cancelled as of today.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)(NYSE:SOA-
WI) -- http://www.solutia.com/-- and its subsidiaries, engage in    
the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 10, 2007,
Standard & Poor's Ratings Services assigned its 'B+' loan rating
to Solutia Inc.'s (D/--/--) proposed $1.2 billion senior secured
term loan and a '3' recovery rating, indicating the likelihood of
a meaningful (50%-70%) recovery of principal in the event of a
payment default.  The ratings are based on preliminary terms and
conditions.  S&P also assigned its 'B-' rating to the company's
proposed $400 million unsecured notes.

Standard & Poor's expects to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge from
Chapter 11 bankruptcy proceedings in early 2008 as planned.  S&P
expect the outlook to be stable.


SOLUTIA INC: Judge Beatty OKs Bank of New York Settlement Pact
--------------------------------------------------------------
The Hon. Prudence C. Beatty of the U.S. Bankruptcy Court for the
Southern District of New York approved Solutia Inc.'s settlement
agreement with holders of Solutia's 11.25% Senior Secured Notes
due July 2009, and the Bank of New York, as successor indenture
trustee for the 2009 Notes.

The Settlement will resolve the disputes that have arisen between
the parties regarding the allowed amount of Claim No. 6210 filed
by the Bank of New York on behalf of the Noteholders.  Solutia
will pay BNY $220,500,000 in cash plus all accrued but unpaid
interest on the 2009 Notes through the Effective Date, at the
rate of 11.25% per annum on the face amount of 2009 Notes.  If
the effective date of Solutia's reorganization plan occurs before
the Settlement is approved, Solutia will pay about $210,000,000
plus accrued unpaid interest through the Effective Date.

                Committee Wants Settlement Delayed

The Official Committee of Unsecured Creditors asked the Court to
delay approval of the 2009 Settlement, in light of the then
pending high-stakes litigation between the Debtors and their exit
lenders.  It argued that the Debtors must not be married to a
financial arrangement that could preclude restructuring
alternatives that may prove necessary, if the Debtors fail to
resolved their disputes with their exit lenders Citigroup Global
Markets Inc., Goldman Sachs Credit Partners L.P., and Deutsche
Bank Securities Inc.  The Debtors, however, have reached a
settlement with the Exit Lenders.

The Creditors Committee, however, had said the 2009 Settlement,
should it be ripe for adjudication, requires key modifications.  
It noted that the 2009 Settlement, as drafted, materially impairs
the Committee's rights with respect to the ultimate allowance of
the 2009 Noteholders' claim in the event that the 2009 Settlement
is declared void by the settling parties, or not approved by the
Court.

The Committee previously sought the Court's determination that
the 2009 Noteholders will have received an $12,200,000 of
postpetition cash interest payments in excess of the amount they
are actually entitled to under Section 506(b) of the Bankruptcy
Code.  The Court denied the determination request, and the
Committee has appealed the Order.  The Committee has also filed a
motion seeking to increase the 2009 Noteholders' disputed claims
reserve under the Plan from $37,500,000 -- the amount in excess
of $210,000,000 which BNY believes they are entitled to -- by
$12,200,000 on account of the Overpayment.

The Committee notes that in the event the 2009 Settlement is
declared void, the parties would return to their pre-settlement
litigation positions.  However, should a distribution have
already been made to the 2009 Noteholders that includes an amount
equal to the Overpayment, the Committee's rights to the
Overpayment would be rendered moot.

The Committee also objected to the provision that provides, if
the 2009 Settlement is declared void or stayed, the Debtors must
establish a reserve funded only with $37,500,000.  This
provision, according to the Committee, would render the 2009
Settlement moot in the event the Court approves the Reserve
Motion.

Judge Beatty, however, held "The [Debtors' Settlement] Motion is
granted in its entirety and approved in all respects."

No objection to the Settlement has been filed by any holder of
the 2009 Notes.  Accordingly, the Court held that BNY is
authorized to settle the claims on behalf of the holders of the
2009 Notes and will have no liability to any holder of the 2009
Notes as a result of its entry into the Settlement.

                 Background to the BoNY Dispute

As reported in the Troubled Company Reporter on May 25, 2006,
the Court denied approval of the Disclosure Statement explaining
the Plan of Reorganization filed by Solutia and its debtor-
affiliates.  BNY is the indenture trustee for the 11.25% Senior
Secured Notes due 2009 issued by Solutia.

BNY complains that as described in the Disclosure Statement, the
Debtors' Plan of Reorganization purports to impair the Senior
Secured Notes, which are designated in Class 3.

On Nov. 1, 2007, the TCR said John K. Cunningham, Esq., at White &
Case LLP, in New York, appeared before the Court on behalf of Bank
of New York, regarding a $223,000,000 claim by the bank on account
of the 11.25% Senior Secured Notes due 2009 issued by Solutia Inc.
or its predecessor.  Bank of New York serves as indenture trustee
for the Senior Notes.

Judge Beatty told BoNY's counsel, John K. Cunningham, Esq., at
White & Case LLP, "Pigs become hogs and then hogs get slaughtered.  
And then eaten.  What you're going for is so piggy that you risk
getting nothing."

At the hearing, which was held on Oct. 31, 2007, Judge Beatty
urged Solutia to settle its dispute with Bank of New York, noting
that the claim was the biggest hurdle to approval of Solutia's
reorganization plan.

"There are no cases that I have found which remotely approximate
the application of these principles to a case of this financial
magnitude," Judge Beatty stated.  Judge Beatty said if no
settlement is reached she will rule on the matter in about two
weeks.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  (Solutia Bankruptcy News, Issue No. 119; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 10, 2007,
Standard & Poor's Ratings Services assigned its 'B+' loan rating
to Solutia Inc.'s (D/--/--) proposed $1.2 billion senior secured
term loan and a '3' recovery rating, indicating the likelihood of
a meaningful (50%-70%) recovery of principal in the event of a
payment default.  The ratings are based on preliminary terms and
conditions.  S&P also assigned its 'B-' rating to the company's
proposed $400 million unsecured notes.

Standard & Poor's expects to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge from
Chapter 11 bankruptcy proceedings in early 2008 as planned.  S&P
expect the outlook to be stable.


SOLUTIA INC: Court Approves Bayer & Lanxess Claims Settlement
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the stipulation signed by Solutia Inc. with
LANXESS Corporation, Bayer AG, Bayer MaterialScience LLC and
Bayer Corporation.

As reported in the Troubled Company Reporter on Feb. 15, 2008,
Bayer acquired Monsanto Company's styrenics business pursuant to
an Asset Purchase Agreement dated Dec. 31, 1995.  Monsanto later
assigned the APA to Solutia Inc. in September 1997, as part of
Solutia's spin off from Monsanto.

Solutia and Bayer were parties to a Resimene Lease and Operating
Agreement dated July 29, 1999.  Solutia terminated the Resimene
Agreement on June 28, 2000, with a termination fee of $2,922,300,
payable to Bayer in 18 monthly installments.  As of the bankruptcy
filing, Solutia owed $432,761 to Bayer for the two remaining
installment payments.

Bayer and Monsanto were also parties to an Indian Orchard Lease
and Services Agreement dated Oct. 31, 1995.  The agreement was
assigned to Solutia as part of the Spin Off.  Bayer terminated
the Indian Orchard Agreement, and Solutia agreed to a termination
fee of $1,191,101, payable by Bayer in 18 monthly installments.  
As of the bankruptcy filing, Bayer owed $397,034 for the six
remaining installment payments.

As of the bankruptcy filing, Bayer also owed Solutia $295,771 for
certain purchases of adipic acid.

Since the bankruptcy filing, LANXESS Corporation, Bayer AG, Bayer
MaterialScience LLC, and Bayer, have undergone corporate
reorganizations, and as a result, Lanxess currently holds certain
claims of Bayer and MaterialScience.

Solutia objected to several of Bayer/Lanxess Parties Claims for
damages arising under the APA.

Solutia also filed Schedule No. 10115234 for $339,771, for
amounts owed by Solutia to Bayer Polymers LLC, now known as
MaterialScience.

                      Settlement Agreement

Following arm's-length negotiations regarding the resolution and
treatment of the Claims, the parties have agreed, among other
things, that Bayer and Lanxess will be entitled to recoup or
offset $372,034 against the $397,034 owed to Solutia for the
Indian Orchard Termination Fee.

Bayer/Lanxess parties will pay Solutia $320,771, representing the
$25,000 balance of the Indian Orchard Termination Fee after giving
effect to the Set-Off, plus the $295,771 owed for adipic acid
purchases.

Also Solutia's Objection will be deemed withdrawn with respect to
the Claims; and upon approval of the Stipulation, Solutia will be
required to reserve the amount of the Allowed Claim in the
Disputed Claims Reserve on account of the Claims.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  (Solutia Bankruptcy News, Issue No. 119; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 10, 2007,
Standard & Poor's Ratings Services assigned its 'B+' loan rating
to Solutia Inc.'s (D/--/--) proposed $1.2 billion senior secured
term loan and a '3' recovery rating, indicating the likelihood of
a meaningful (50%-70%) recovery of principal in the event of a
payment default.  The ratings are based on preliminary terms and
conditions.  S&P also assigned its 'B-' rating to the company's
proposed $400 million unsecured notes.

Standard & Poor's expects to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge from
Chapter 11 bankruptcy proceedings in early 2008 as planned.  S&P
expect the outlook to be stable.


SOLUTIA INC: Court Approves Quinn Emanuel as Conflicts Counsel
--------------------------------------------------------------
Solutia Inc. and its Debtor-affiliates obtained approval from the
U.S. Bankruptcy Court for the Southern District of New York's to
employ Quinn Emanuel Urquhart Oliver & Hedges LLP, as their
special litigation and conflicts counsel for matters arising in or
related to the Debtors' Chapter 11 cases, nunc pro tunc to
Jan. 22, 2008.

The Troubled Company Reporter said on Feb. 6, 2008, that according
to Rosemary L. Klein, general counsel of Solutia and an authorized
officer of each of the other Debtors, because of Quinn Emanuel's
experience in matters concerning complex bankruptcy and commercial
litigation, the firm is well-suited to deal effectively with many
of the potential legal issues that may arise in the Debtors'
Chapter 11 cases.

As special counsel, Quinn Emanuel will:

   (a) advise the Debtors regarding their ability to initiate
       actions to protect their rights under certain Oct. 25,
       2007 Commitment Letter -- with respect to Solutia's exit
       financing -- and related documents and enforce the
       Commitment Parties' legally binding commitments for the
       benefit of their estates;

   (b) advise the Debtors regarding their ability to initiate
       actions to protect their rights as against the Debtors'
       postpetition lenders; and

   (c) commence and conduct any and all litigation necessary or
       appropriate to assert rights held by the Debtors, protect
       assets of the Debtors' Chapter 11 estates or otherwise
       further the goal of completing the Debtors' successful
       reorganization.

The Debtors will pay Quinn Emanuel in accordance with its
standard hourly rates and reimburse the firm of actual and
necessary expenses.  The firm informs the Court that its rates
are subject to period adjustment to reflect economic and other
conditions.  The firm's current hourly rates are:

              Partners               $660 - $950
              Other Attorneys        $380 - $950
              Legal Assistants       $250 - $280

Quinn Emanuel has not, does not, and will not represent any
entities or any of their respective affiliates or subsidiaries,
in matters related to the Debtors, their Chapter 11 cases, or
other matters directly adverse to the Debtors during the pendency
of their cases, Susheel Kirpalani, Esq., a member of Quinn
Emanuel, assures the Court.

Mr. Kirpalani asserts that the firm is a disinterested person, as
the term is defined by Section 101(14) of the Bankruptcy Code.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  (Solutia Bankruptcy News, Issue No. 119; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or  
215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 10, 2007,
Standard & Poor's Ratings Services assigned its 'B+' loan rating
to Solutia Inc.'s (D/--/--) proposed $1.2 billion senior secured
term loan and a '3' recovery rating, indicating the likelihood of
a meaningful (50%-70%) recovery of principal in the event of a
payment default.  The ratings are based on preliminary terms and
conditions.  S&P also assigned its 'B-' rating to the company's
proposed $400 million unsecured notes.

Standard & Poor's expects to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge from
Chapter 11 bankruptcy proceedings in early 2008 as planned.  S&P
expect the outlook to be stable.


SPOTTED DOG: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Spotted Dog, Inc.
        5825 Glenridge Drive, Building 1, Suite 208
        Atlanta, GA 30328

Bankruptcy Case No.: 08-63542

Chapter 11 Petition Date: February 27, 2008

Court: Northern District of Georgia (Atlanta)

Debtor's Counsel: Leon S. Jones, Esq.
                     (ljones@joneswalden.com)
                  Jones & Walden, L.L.C.
                  21 Eighth Street, Northeast
                  Atlanta, GA 30309
                  Tel: (404) 564-9300
                  Fax: (404) 564-9301

Estimated Assets:        Less than $50,000

Estimated Debts: $1 million to $10 million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Cornerstone Bank               $1,316,491
2060 Mount Paran Road,
Suite 100
Atlanta, GA 30327

Global Swift Funding, L.L.C.   $308,000
809 Bowsprit Road
Chula Vista, CA 91914

Reach Financial, L.L.C.        $208,337
8813 Heatherton Ridge Drive
Savage, MN 55378

Clever Ideas, Inc.             $206,979

AdvanceMe, Inc.                $139,143

Puget Sound Leasing            $71,828

Inman Park Properties          $33,571

Evans National Leasing         $28,915

T.C.F. Equipment Finance       $21,755

Georgia Power                  $8,826

Miltons                        $7,709

Johnson Deversey, Inc.         $5,694

Jackson Comfort Systems        $4,932

Georgia Natural Gas            $3,796

Atlanta Sound Lighting         $2,975

Schindler Elevator Corp.       $2,008

Blockbuster Textiles           $1,971

Encore Atlanta                 $1,600

East 48th Street Bakery        $1,088

Waste Management               $797


ST MARY LAND: Inks $42 Million Oil and Gas Assets Acquisition Deal
------------------------------------------------------------------
St. Mary Land & Exploration Company entered into an agreement to
acquire producing and non-producing oil and gas assets adjacent to
existing St. Mary acreage in East Texas for approximately
$42 million in cash, subject to customary purchase price
adjustments at closing.

The transaction will be financed with the company's cash on hand
and borrowings under its existing credit facility.

The company related that the transaction will provide access to
3,000 gross acres in Panola County, Texas.  Net proved reserves
related to the properties are initially estimated to be
approximately 22 BCFE.  

The closing of transaction is expected to occur by April 1, 2008,
and is subject to customary due diligence.  

                About St. Mary Land & Exploration

Based in Denver, Colorado, St. Mary Land & Exploration Company
(NYSE: SM) - http://www.stmaryland.com/-- is engaged in the
exploration, exploitation, development, acquisition, and
production of natural gas and crude oil in five core areas in the
United States.  The company invests in oil and gas producing
assets that provide a superior return on equity while preserving
underlying capital, resulting in a return on equity to
stockholders that reflects capital appreciation as well as the
payment of cash dividends.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 12, 2007,
Standard & Poor's Ratings Services revised its outlook on oil and
gas exploration and production company St. Mary Land & Exploration
Co. to positive from stable and affirmed its 'BB-' corporate
credit rating on the company.  "The company's good operating
results thus far in 2007 and its adherence to moderate financial
leverage measures spurred the outlook change," said Standard &
Poor's credit analyst David Lundberg.  As of Sept. 30, 2007, St.
Mary had $443 million in debt.


STONE ENERGY: Earns $65 Million in Quarter ended December 31
------------------------------------------------------------
Stone Energy Corporation reported fourth quarter ended Dec. 31,
2007, net income of $64.9 million and full year 2007 net income of
$181.4 million.   

For the fourth quarter of 2007, net income of $64.9 million
compared to a net loss of $298.5 million for the fourth quarter of
2006.  The full year 2007 net income of $181.4 million compared to
a 2006 net loss of $254.2 million.

The results for both the fourth quarter and year-end 2007 included
an $8.2 million pre-tax impairment charge on Stone's investment in
China.  The reported loss for both the fourth quarter and year-end
2006 included a pre-tax charge of $510.0 million incurred due to a
ceiling test write-down.

Discretionary cash flow for 2007 totaled $452.7 million compared
to $456.4 million during 2006.  Higher volumes and higher realized
prices in 2007 resulted in revenues being $64.3 million higher
than in 2006.  Additionally, lease operating expenses and
depreciation, depletion and amortization expenses were
$9.3 million and $18.0 million lower in 2007 compared to 2006.

However, all of these positive variances were offset by
$95.6 million in current taxes in 2007 compared to $0.2 million of
current taxes in 2006.  For the fourth quarter 2007, discretionary
cash flow totaled $125.9 million compared to $126.5 million during
fourth quarter 2006.

"We are pleased with our results for the year," CEO David Welch
stated.  "Early in 2007, we set key objectives to focus on low-
risk exploitation projects, maintain production with a limited
capital budget, and significantly reduce debt in order to position
ourselves for per share growth in 2008.  Our 2007 results show
that we delivered on our promise."

"During the year, we experienced a 91% drilling success rate, with
20 out of 22 wells being successful," Mr. Welch added.  "Our 2007
production volumes came in on the high side of our original
guidance despite selling our Rocky Mountain properties at mid-
year, as our operations group reduced downtime, optimized
compression and increased well work projects. After the sale of
the Rocky Mountain properties, we reduced our debt by 50% from
almost $800 million to $400 million and our year-end cash position
of $475 million provides us with significant financial and
operational flexibility."

In the fourth quarter 2007, Stone's investment in China was
impaired by $8.2 million after reviewing the results of the
drilling program and the proposed areas of focus within the
concession area.

There were no borrowings outstanding at Dec. 31, 2007, under the
company's bank credit facility.  We had letters of credit totaling
$52.8 million, resulting in $122.2 million of available borrowings
at Dec. 31, 2007.  The borrowing base under the credit facility is
re-determined periodically based on the bank group's evaluation of
our proved oil and gas reserves.

At Dec. 31, 2007, the company's balance sheet showed total
assets                                
of $1.89 billion, total liabilities of $1.00 billion and total
stockholders' equity of $0.89 billion.

                   About Stone Energy Corporation

Headquartered in Lafayette, Louisiana, Stone Energy Corporation
(NYSE:SGY) -- http://www.stoneenergy.com/-- is an independent oil  
and natural gas company.  The company is engaged in the
acquisition and subsequent exploration, development, operation and
production of oil and gas properties located in the conventional
shelf of the Gulf of Mexico, the deep shelf of the Gulf of Mexico,
the deepwater of the Gulf of Mexico, the Rocky Mountain Basins and
the Williston Basin.  Stone Energy is also engaged in an
exploratory joint venture in Bohai Bay, China.

                           *     *    *

As reported in the Troubled Company Reporter on Oct. 25, 2007,
Moody's Investors Service affirmed Stone's B3 corporate family
rating and the B3 probability of default rating. Simultaneously,
Moody's is upgrading Stone's speculative grade liquidity rating to
SGL-2 from SGL-3.  The outlook is also changed to stable from
negative.


SUMMERWIND INVESTORS: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Summerwind Investors, L.L.C.
        30900 Rancho Viejo Road, Suite 100
        San Juan Capistrano, CA 92675

Bankruptcy Case No.: 08-10952

Chapter 11 Petition Date: February 28, 2008

Court: Central District Of California (Santa Ana)

Judge: Robert N. Kwan

Debtor's Counsel: Robert P. Goe, Esq.
                     (kmurphy@goeforlaw.com)
                  Goe & Forsythe, L.L.P.
                  660 Newport Center Drive, Suite 320
                  Newport Beach, Ca 92660
                  Tel: (949) 467-3780
                  Fax: (949) 721-0409
                  http://www.goeforlaw.com/

Estimated Assets: $10 million to $50 million

Estimated Debts:  $10 million to $50 million

The Debtor stated that its largest unsecured creditors are not
known at this time.


TEMBEC INC: Ontario Court Approves Plan of Arrangement under CBCA
-----------------------------------------------------------------
Tembec Inc. disclosed that the plan of arrangement under the
Canada Business Corporations Act, relating to the recapitalization
transaction, has been approved and sanctioned by the Ontario
Superior Court of Justice.
    
The Court determined that the Plan of Arrangement met all
statutory requirements, that it was brought in good faith and that
it was fair and reasonable in the circumstances.  Accordingly, the
Court issued a final order approving the Plan of Arrangement.
    
"This is excellent news for the company and its stakeholders,"
James Lopez, president and CEO of Tembec, said.  "Court approval
of the Plan of Arrangement is the final step in advance of closing
the transaction.  With a secure financial footing and solid
stakeholder support, the company that will emerge from this
transaction will be very well positioned to pursue its business
strategy.  The immediate focus will be on improving the operating
and financial performance of the company with the short-term goal
of restoring free cash flow."
    
Resolutions relating to the Recapitalization were approved by in
excess of 95% of shareholders of Tembec and by in excess of 98% of
noteholders of Tembec Industries Inc. at meetings held on
Feb. 22, 2008.  

Court approval of the Plan of Arrangement was the final
outstanding approval requirement prior to implementation of the
Recapitalization.  The closing and implementation of the
Recapitalization is expected to occur today, Feb. 29, 2008.
    
The company also disclosed that these individuals will serve on
the board of directors of the new Tembec Inc. effective as at
the time of closing, on Feb 29:

   -- Norman Betts, Storytown, New Brunswick
   -- James Brumm, New York, New York
   -- Jim Chapman, Greenwich, Connecticut
   -- Jim Continenza, Lakeville, Minnesota
   -- Jim Lopez, North Bay, Ontario
   -- Luc Rossignol, Témiscaming, Québec
   -- Fran Scirrico, Cold Spring Harbor, New York
   -- David Steuart, Burlington, Ontario
   -- Lorie Waisberg, Toronto, Ontario

"I am pleased to have this accomplished group of individuals join
our board," Mr. Lopez concluded.  "The unique mix of skills and
experience they bring will be very helpful in providing the
guidance necessary as the company charts its course forward
following this very important transaction."
    
                        About Tembec

Headquartered in Montreal Quebec, Tembec Inc. (TSC:TBC) --
http://www.tembec.com -- operates an integrated forest products      
business.  The company's operations consist of four business
segments: forest products, pulp, paper and chemicals.  The forest
products segment consists primarily of forest and sawmills
operations, which produce lumber and building materials.  The pulp
segment includes the manufacturing and marketing activities of a
number of different types of pulps.  The paper segment consists
primarily of production and sales of newsprint and bleached board.   
The chemicals segment consists primarily of the transformation and
sale of resins and pulp by-products.  As of Sept. 29, 2007, Tembec
operated manufacturing facilities in New Brunswick, Quebec,
Ontario, Manitoba, Alberta, British Columbia, the states of
Louisiana and Ohio, as well as in Southern France.

                          *     *     *

Standard & Poor's placed Tembec Inc.'s long-term foreign and local
issuer credit ratings at 'CC' in Dec. 20, 2007.


TRAILER BRIDGE: Moody's Gives Negative Outlook; Keeps All Ratings
-----------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Trailer
Bridge, Inc. to negative from stable.  In addition, Moody's has
affirmed all of Trailer Bridge's existing ratings including the B3
corporate family and probability of default ratings, the B3 LGD 3
rating on the 9.25% guaranteed senior secured notes due 2011, and
the speculative grade liquidity rating of SGL-3.

This action follows weaker than expected performance for the
company in the second half of 2007 and an expectation of
continuing near term weakness in the Puerto Rico economy.  The
company's weaker than expected performance resulted from a market
decline in ocean shipping volumes between the U.S. and Puerto
Rico, ramp-up costs on Trailer Bridge's Dominican Republic loop
that commenced in August 2007, and high fuel costs.  Moody's
anticipates that economic weakness in Puerto Rico could delay
greater shipping volume growth needed to boost Trailer Bridge's
operating performance.  In addition to economic weakness, expected
high fuel costs and need to achieve break even on the Dominican
Republic loop will likely pose challenge in 2008.  However,
Moody's notes that Trailer Bridge has secured some new contracts
which may help the company meet the challenge of a weak economy in
2008 such that credit metrics remain appropriate for the B3 rating
level.  The company has an established position in the relatively
closed ocean shipping market between the U.S. and Puerto Rico
which bodes well for Trailer Bridge's long term prospects.   
Furthermore, Trailer Bridge has stated that it gained market share
in 2007.

Moody's notes that the company received a waiver for a covenant
breach that occurred in the fourth quarter of 2007 when fixed
charge coverage fell below the required 1.0 times minimum.  
Trailer Bridge has a speculative grade liquidity rating of SGL-3
which reflects the company's adequate liquidity profile.  The
company has not historically relied on its $10 million revolving
credit facility; nevertheless, with cash on hand at the end of
2007 of $1.9 million, Moody's considers Trailer Bridge's ability
to access the revolving credit facility as a key aspect of the
overall credit profile.  In addition to ongoing performance
weakness, inability to maintain credit facility compliance would
subject the ratings to downward revision.  For the March 31, 2008
covenant compliance test, a credit agreement amendment or another
waiver will likely be required due to the high capital spending
that occurred in 2007 and is causing fixed charge coverage below
1.0 times.  Should the ability to obtain a credit facility
amendment or a covenant compliance waiver come in doubt, the
ratings would likely be downgraded.

Trailer Bridge, Inc. headquartered in Jacksonville, Florida, is an
integrated trucking and marine freight carrier that provides
truckload freight transportation primarily between the continental
U.S. and Puerto Rico.  The company owns and operates two Roll-
On/Roll-Off and five Triple Stack Box Carrier barges and
specializes in 53 foot high-cube inter-modal containers.


TRW AUTOMOTIVE: CAW Workers Rally at Windsor Plant in Ontario
-------------------------------------------------------------
TRW Automotive Inc. union workers picketed at a plant in Windsor,
Ontario, on Thursday, forcing a Chrysler LLC assembly plant also
in Windsor to temporarily shut down, various sources report.

TRW, which supplies Chrysler suspension modules for Dodge Caravan
and Town & Country minivans, employs 190 salaried and hourly
workers at the plant, Dow Jones Newswires relates.  TRW and
Canadian Auto Workers union representatives failed to reach an
agreement on wage increases, spurring the protest.

Reuters discloses that TRW spokesman John Wilkerson proposes to
maintain TRW plant production using salaried workers and hopes to
continue negotiations with the union as soon as possible.

                       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.

                              About TRW

Headquartered in Livonia, Michigan, TRW Automotive, Inc., supplies
automotive systems, modules, and components to global vehicle
manufacturers and related aftermarket.  The company has three
operating segments; Chassis Systems, Occupant Safety Systems, and
Automotive Components.  Its primary business lines encompass the
design, manufacture and sale of active and passive safety related
products.  

                       *     *     *

As reported in the Troubled Company Reporter on Jan. 25, 2008,
Moody's Investors Service affirmed the ratings of TRW Automotive,
Inc.: Corporate Family Rating, Ba2; senior secured bank credit
facilities, Baa3; and senior unsecured notes, Ba3, but revised the
rating outlook to negative from stable.



URS CORP: Earns $132 Million in Fiscal Year Ended December 28
-------------------------------------------------------------
URS Corporation reported its financial results for the fiscal year
ended Dec. 28, 2007.  Revenues increased 27% to $5.38 billion from
$4.22 billion in fiscal 2006.  Net income for fiscal 2007 was
$132.20 million, a 17% increase from $113.0 million in fiscal
2006.

The Company's fiscal 2007 results include six weeks of operations
of the former Washington Group International, Inc., which URS
acquired on Nov. 15, 2007.  Excluding the results of the
Washington Division, as well as costs associated with the
acquisition, URS' EPS for the year would have been $2.58, an 18%
increase from fiscal 2006.

As of Dec. 28, 2007, the Company's backlog was $18.71 billion,
compared to $4.64 billion as of Dec. 29, 2006.  The increase in
backlog resulted from the acquisition of Washington Group and new
contract awards during the year.

"URS performed very well in 2007," Martin M. Koffel, Chairman and
Chief Executive Officer, stated.  "Our private sector and state
and local government businesses were particularly robust as a
result of favorable trends in the power market and strong
infrastructure spending.  We generated $311.9 million in cash from
operations.  We repaid $239 million in bank debt during the year,
including $125 million of the debt related to the Washington Group
acquisition."

                   Fourth Quarter 2007 Results

For the fourth quarter of fiscal 2007, the Company reported
revenues of $1.74 billion and net income of $26.40 million.  For
the fourth quarter of fiscal 2006, the Company reported revenues
of $1.08 billion and net income of $26.3 million.

                    Fiscal 2008 Earnings Outlook

URS expects its fiscal 2008 revenues to be approximately
$9.8 billion.  The Company expects that GAAP net income will be
between $187 and $197 million and GAAP EPS will be in the range of
$2.24 to $2.36 for fiscal 2008.

                             Balance Sheet

The company's balance sheet showed total assets of $6.92 billion
and total liabilities of $3.42 billion, resulting in $3.47 billion
stockholders' equity.  Equity at Dec. 29, 2006 was $1.50 billion.

                         About URS Corp.

Headquartered in San Francisco, California, URS Corporation
(NYSE:URS) -- http://www.urscorp.com/-- offers a comprehensive
range of professional planning and design, systems engineering
and technical assistance, program and construction management,
and operations and maintenance services for transportation,
facilities, environmental, water/wastewater, industrial
infrastructure and process, homeland security, installations and
logistics, and defense systems.  The company operates in more
than 20 countries with approximately 29,500 employees providing
engineering and technical services to federal, state and local
governmental agencies as well as private clients in the
chemical, pharmaceutical, oil and gas, power, manufacturing,
mining and forest products industries.  The company also has
offices in Argentina, Australia, Belgium, China, France,
Germany, and Mexico, among others.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 7, 2007,
Moody's Investors Service has downgraded the Corporate Family
Rating of URS Corporation to Ba2 from Ba1 following the company's
acquisition of Washington Group International, Inc.  Moody's said
the ratings outlook is stable.


USG CORP: Weak Fin'l Performance Cues Moody's Rating Cuts to 'Ba2'
------------------------------------------------------------------
Moody's Investors Service downgraded the debt ratings of USG
Corporation to Ba2 reflecting the ongoing pressure on the
company's financial performance caused by the sharp contraction in
the new home construction market.  At the same time a corporate
family rating of Ba2 and a speculative grade rating of SGL-2 were
assigned.  This action concludes the review that began on Jan. 31,
2008.  The ratings outlook is negative.

These debt ratings were downgraded or assigned:

  -- $650 million Revolving Credit Facility, downgraded to Ba2
     (LGD4, 56%) from Baa3;

  -- $500 million Senior Notes, due 2016, downgraded to Ba2 (LGD4,
     56%) from Baa3;

  -- $500 million Senior Notes, due 2018, downgraded to Ba2 (LGD4,
     56%) from Baa3;

  -- $239 million of IRBs, various maturities, downgraded to Ba2
     (LGD4, 56%) from Baa3;

  -- Corporate family rating, assigned at Ba2;

  -- Speculative grade liquidity rating, assigned at SGL-2.

The ratings downgrade reflects the company's weak financial
performance and poor outlook due to the homebuilding contraction
and the pricing environment for the company's primary product,
gypsum.  As one of the world's largest providers of gypsum
wallboard, the company's volumes are primarily driven by the new
home construction and repair and remodeling activities.  Given
that estimated new home starts for 2008 are likely to be 25%, or
so, below 2007's level, the company's financial performance is
likely to remain under pressure for at least in 2008 and possibly
longer.  The effects of the homebuilding slowdown are slightly
mitigated by the company's Worldwide Ceilings division and to a
lesser degree its building products distribution business.   
Although these businesses are smaller than the wallboard business,
they are performing better because the ceiling market has
benefited from the commercial market's strength while the
distribution market is more diversified in its sales.

The SGL-2 liquidity rating reflects anticipated good liquidity for
the next 12 months and takes into consideration both internal
liquidity and external liquidity, covenant compliance, as well as
alternate liquidity sources.  The company's $650 million revolver
is expected to have over $500 million in availability (including
letters of credit) during 2008.

The negative ratings outlook reflects prospects for continuing
weakness in the gypsum business as well as the impact of a slowing
economy on the rest of the company's businesses.  The outlook is
likely to remain negative until wallboard pricing and the
company's overall margins improve.

USG Corporation is a holding company headquartered in Chicago,
Illinois.  Through operating company subsidiaries, USG is a
leading producer and distributor of building materials in the
United States, Canada and Mexico.  The company manufactures and
markets various products that include gypsum wallboard, ceiling
tiles and ceiling grids that are primarily used in commercial
applications, and operates a network of distribution centers.   
Revenues for 2007 were approximately $5.2 billion.


VALENCE TECH: Inks Agreement to Sell $1 Million Common Shares
-------------------------------------------------------------
Valence Technology Inc. entered into an agreement last week to
sell $1 million of its common stock to Berg & Berg Enterprises
LLC, an affiliate of the company's chairman Carl E. Berg.  

The proceeds will be used to fund corporate operating needs and
working capital.  Under the terms of the agreement, the company
will issue $1 million of its shares of common stock at a price to
be determined based on the closing bid price on Feb. 27, 2008, in
a private placement transaction exempt from the registration
requirements of the Securities Act of 1933, as amended, pursuant
to Section 4(2) thereof.  

                    About Valence Technology

Headquartered in Austin, Texas, Valence Technology Inc.
(Nasdaq: VLNC) -- http://www.valence.com/-- develops and   
markets Lithium Phosphate Rechargeable Batteries.  The company
has facilities in Austin, Texas; Las Vegas, Nevada; Mallusk,
Northern Ireland and Suzhou, China.

                      Going Concern Doubt

As reported in the Troubled Company Reporter on June 21, 2007,
PMB Helin Donovan LLP, in Austin, Tex., expressed substantial
doubt about Valence Technology, Inc.'s ability to continue as a
going concern after auditing the company's consolidated
financial statements for the year ended March 31, 2007.  The
auditing firm pointed to the company's recurring losses from
operations, negative cash flows from operations and net
stockholders' capital deficit.  

At Dec. 31, 2007, the company had US$20.06 million in total
assets, US$8.61 million in redeemable convertible preferred stock,
and US$81.23 million in total liabilities, resulting in a
US$69.78 million total stockholders' deficit.


VALLE GRANDE: Case Summary & Three Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Valle Grande Properties, L.L.C.
        dba Valle Grande Golf Course
        7908 Calle Espada
        Bakersfield, CA 93309

Bankruptcy Case No.: February 28, 2008

Type of Business: The Debtor owns and operates a golf course.

Chapter 11 Petition Date:

Court: Eastern District of California (Fresno)

Judge: Whitney Rimel

Debtor's Counsel: Lawrence G. Campitiello, Esq.
                  5900 La Place Court, Suite 100
                  Carlsbad, CA 92008-8832
                  Tel: (760) 931-9086

Estimated Assets: $10 million to $50 million

Estimated Debts:   $1 million to $10 million

Debtor's Three Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Mary Mata                      loan                  unknown
7908 Calle Espada
Bakersfield, CA 93309

Ron Mata                       loan                  unknown
9811 Caswell
Bakersfield, 93309

Patricia Parada                loan                  unknown
601 Purdy Court
Bakersfield, 93309


VALLEJO CITY: Reaches Tentative Deal with Labor Unions
------------------------------------------------------
Vallejo city officials and public safety labor unions reached a
tentative agreement on Thursday hours before the council was set
to vote on possibly filing for bankruptcy, Sarah Rohrs of San Jose
Mercury News reports.

According to the report, Vallejo firefighters union president Kurt
Henke said that it's possible that a special council meeting will
be held Monday to go over the proposed deal with the public.

Details of the agreement were not disclosed.

Without extensive cost-cutting, the city will be $6 million in
debt and will have exhausted its $4 million in reserves by June
30, Vallejo Finance Director Rob Stout told the city council on
Feb. 13.  City Manager Joe Tanner had said the city faces a
$10.1 million general fund operating deficit for the current
fiscal year and a negative available fund balance of $5.9 million
on June 30, 2008.

"Based upon the updated financial projections, the current
estimate for insolvency is late April 2008," Mr. Tanner had said.  
The city currently has a $135 million liability for the present
value of retiree benefits already earned by active and retired
employees and an additional $6 million a year as employees
continue to vest and earn this future benefit, Mr. Tanner said.  
Public safety contracts for police and fire services make up 80
percent of the city's general fund.  

A possible bankruptcy filing of Vallejo will be the first for a
California city.

Vallejo is a city in Solano County.  As of the 2000 census, the
city had a total population of 116,760.  It is located in the San
Francisco Bay Area on the northern shore of San Pablo Bay.  
According to Vallejo's comprehensive annual report for the
year ended June 30, 2007, the city has $983 million in assets and
$358 million in debts.


WELLS FARGO: Fitch Rates $1.35 Million Class B-5 Certificates at B
------------------------------------------------------------------
Fitch has rated Wells Fargo mortgage pass-through certificates,
series 2008-AR1, as:

  -- $646,309,100 classes A-1, A-2, A-3, A-4, A-5, A-6 and A-R,
     'AAA';
  -- $11,818,000 class B-1 'AA';
  -- $5,741,000 class B-2 'A';
  -- $2,026,000 class B-3 'BBB';
  -- $4,052,000 class B-4 'BB';
  -- $1,350,000 class B-5 'B'.

The 'AAA' rating on the senior certificates reflects the 4.30%
subordination provided by the 1.75% class B-1, 0.85% class B-2,
0.30% class B-3, 0.60% privately offered class B-4, 0.20%
privately offered class B-5, and 0.60% privately offered class
B-6.  The class B-6 is not rated by Fitch.

Fitch believes the amount of credit enhancement available will be
sufficient to cover credit losses.  The ratings also reflect the
high quality of the underlying collateral, the integrity of the
legal and financial structures, and the master and primary
servicing capabilities of Wells Fargo Bank, N.A. (WFB; rated
'RMS1' and 'RPS1' by Fitch).

This transaction contains certain classes designated as
exchangeable certificates and others as regular certificates.  The
classes A-3, A-4, A-5 and A-6 certificates are exchangeable
certificates.  The remainder of the classes are regular
certificates.

The transaction is secured by a pool of 963 mortgage loans, which
consists of fully amortizing, one- to four-family, adjustable-rate
mortgage loans that provide for a fixed interest rate during an
initial period of approximately five years.  Thereafter, the
interest rate will adjust on an annual basis.  The interest rate
of each mortgage loan will adjust to equal the sum of the index
and a gross margin.  Approximately 86.18% of the mortgage loans
are interest-only loans, which require only payments of interest
until the month following the first adjustment date.

The mortgage loans have an aggregate principal balance of
approximately $675,349,148 as of the cut-off date (Feb. 1, 2008),
an average balance of $701,297, a weighted average remaining term
to maturity of 357 months, a weighted average original loan-to-
value ratio of 71.57%, and a weighted average coupon of 6.498%.  
Rate/Term and equity take-out refinances account for 23.92% and
13.94% of the loans, respectively.  The weighted average original
FICO credit score of the loans is 741.  Owner-occupied properties
and second homes comprise 83.65% and 14.71% of the loans,
respectively.  The states that represent the largest geographic
concentration are California (28.04%), Florida (9.99%), New York
(9.69%), and New Jersey (5.83%).  All other states represent less
than 5% of the aggregate pool balance as of the cut-off date.

All of the mortgage loans were originated or purchased by WFB.  
WFB sold the loans to Wells Fargo Asset Securities Corporation, a
special purpose corporation, which deposited the loans into the
trust.  The trust issued the certificates in exchange for the
mortgage loans.  WFB will act as servicer, master servicer, paying
agent, and custodian, and HSBC Bank USA, N.A. (rated 'AA/F1+' by
Fitch) will act as trustee. For federal income tax purposes,
elections will be made to treat the trust as two separate real
estate mortgage investment conduits.


WICKES FURNITURE: Liquidation Sale of All Stores Starts Tomorrow
----------------------------------------------------------------
By order of a U.S. Bankruptcy Court for the District of Delaware,
store closing sales will begin Saturday, March 1, 2008, at all 38
Wickes Furniture Inc. stores in California, Illinois, Indiana and
Nevada.  Over $75 million of famous brand furniture and
accessories will be liquidated.  Sales at 5 Oregon locations are
planned to commence later in March.

Discounts from 25% to 50% will be offered on all merchandise in
each of the 38 California, Illinois, Indiana and Nevada stores.  
Consumers will be able to benefit from very significant savings on
Wickes' entire stock of furniture for the living room, dining
room, bedroom, kids' room and home office.  All mattress sets,
home entertainment centers, Oriental rugs and decorative
accessories will be deeply discounted, as well.

Liquidation of all inventory and store fixtures will be managed by
a joint venture comprised of Hilco Merchant Resources LLC, SB
Capital Group LLC, Tiger Capital Group LLC and Planned Furniture
Promotions, Inc.

"This is a tremendous opportunity for every home owner and
apartment renter to take advantage of truly compelling discounts
on a huge selection of brand name furniture and accessories,"
Michael Keefe, President of Hilco Merchant Resources stated.  
"Anticipating that value conscious consumers will respond very
positively to these outstanding savings on quality home
furnishings, we expect this will be a short sale."

A group of liquidators won the Feb. 25 auction for the assets of
Wickes Furniture, according to Bill Rochelle of Bloomberg News
citing the Chicago Sun Times.  The 43-store furniture retailer had
no binding contract in advance of the sale.

Based in Wheeling, Illinois, Wickes Furniture Company, Inc. --
http://www.wickesfurniture.com/-- is one of the leading furniture      
retailers in the U.S. with 43 retail stores serving greater
Chicago, Los Angeles, Las Vegas, and Portland.  Founded in 1971,
Wickes offers attractive room packages featuring complete living
rooms, dining rooms, bedrooms as well as bedding, home
entertainment, accessories and accent furniture.  Wickes employs
over 1,700 employees and offers products from leading furniture
and bedding manufacturers.

The company and two of its debtor-affiliates filed for Chapter 11
protection on Feb. 3, 2008 (Bankr. D. Del. Lead Case No. 08-
10213).  Donald J. Detweiler, Esq., at Greenberg Traurig LLP,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
consolidated estimated assets of $10 million to $50 million, and
estimated debts of $50 million to $100 million.


WOLVERINE TUBE: Credit & Receivables Sales Facilities Amended
-------------------------------------------------------------
Wolverine Tube Inc. has executed amendments to its $35 million
Secured Revolving Credit Facility and its $75 million Receivables
Sales Facility which extend the maturity dates to April 28, 2009,
and Feb. 19, 2009, and increase borrowing availability.  The
facilities were scheduled to mature in April 2008.

"These extended credit facilities will support Wolverine's
operating requirements for 2008 well as fund a portion of its
overall liquidity requirements to refinance its debt maturities,"
David Owen, Wolverine's chief financial officer, commented.  "This
will be supplemented by Wolverine's strong cash position, which is
primarily a result of equity investments in Preferred Stock, a
common stock rights offering and working capital reductions."

Headquartered in Huntsville, Alabama, Wolverine Tube Inc.
(OTC:WLVT) -- http://www.wlv.com/ and http://www.silvaloy.com/  
manufactures and distributes copper and copper alloy tubular
products, fabricated and metal joining products, well as rod and
bar products.  The company focuses on developing and manufacturing
tubular products with heat transfer capabilities used in
engineered applications.  The company's major customers'
headquarters are in North America and include commercial and
residential air conditioning and refrigeration equipment
manufacturers, appliance manufacturers, industrial equipment
manufacturers, utilities and other power generating companies,
refining and chemical processing companies, and plumbing
wholesalers.  Wolverine classifies products as commercial
products, wholesale products, and rod, bar and other products.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 22, 2007,
Moody's Investors Service confirmed Wolverine Tube's Caa2
corporate family rating, Caa2 probability of default rating, and
Caa3 senior unsecured rating (LGD4, 63%).  The rating outlook was
revised to negative from ratings under review.  


WOODCOCK ESTATE: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Woodcock Estates, Inc.
        1 Myrtle Avenue
        Cambridge, NY 12816

Bankruptcy Case No.: 08-10502

Type of Business: The Debtor provides health care services.

Chapter 11 Petition Date: February 26, 2008

Court: Northern District of New York (Albany)

Judge: Robert E. Littlefield Jr.

Debtor's Counsel: Richard H. Weiskopf
                   (rweiskopf@oalaw.com)
                  O'Connell & Aronowitz
                  54 State Street, 9th Floor
                  Albany, NY 12207
                  Tel: (518) 462-5601
                  Fax: (518) 462-2670
                  http://www.oalaw.com/

Total Assets: $2,709,100

Total Debts:  $1,225,959

Consolidated Debtor's List of 20 Largest Unsecured Creditors:

   Entity                                            Claim Amount
   ------                                            ------------
   National Grid                                     $49,200
   300 Erie Boulevard West
   Syracuse, NY 13202

   GA Bove                                           $37,642
   76 Railroad Street
   Machanicville, NY 12118

   Aqua Water                                        $26,499
   762 W. Lancaster Avenue
   Bryn Mawr, PA 19010

   LaFlammes                                         $14,000

   Nolan & Heller                                    $12,685

   Quandt's Foodservice                              $10,557
   Distributors

   Direct Supply                                     $9,500

   Lapans Precision                                  $5,762

   Eagle, The                                        $5,327

   Kone                                              $5,238

   Hill & Markes                                     $4,953

   NYS Unemployment Insurance                        $4,685

   True Value                                        $4,344

   Doberts Dairy                                     $3,983

   Morning Star                                      $3,327

   Lapans                                            $3,250

   Jarret-Martin Engineers                           $2,893

   Morning Star Excavating                           $2,701

   Adirondack Medical Services                       $1,765

   Napaul Publishers                                 $1,570


YOUR RV WIZARD: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Your R.V. Wizard, L.L.C.
        P.O. Box 1848
        Benson, AZ 85602

Bankruptcy Case No.: 08-01793

Type of Business: The Debtor is a recreational vehicles dealer.

Chapter 11 Petition Date: February 27, 2008

Court: District of Arizona (Tucson)

Judge: Eileen W. Hollowell

Debtor's Counsel: Alan R. Solot, Esq.
                     (arsolot@tiltonandsolot.com)
                  Tilton & Solot
                  459 North Granada Avenue
                  Tucson, AZ 85701
                  Tel: (520) 622-4622
                  Fax: (520) 882-9861
                  http://www.tiltonandsolot.com/

Estimated Assets:     $100,000 to $500,000

Estimated Debts: $1 million to $10 million

The Debtor did not file a list of its largest unsecured creditors.


ZALE CORP: Reduces Staffing on New Operational Efficiency Program
-----------------------------------------------------------------
Zale Corporation has begun the implementation of a program
designed to enhance the company's profitability and improve its
overall effectiveness.  The program, which seeks to generate
$65 plus million in ongoing, annualized savings beginning in the
company's fourth quarter of fiscal 2008, is the product of
management's comprehensive review of operating and capital
expenses in consultation with the board of directors.

Key elements of the program include:

  * Estimated $65 plus million in ongoing, annualized savings a
    majority of which is overhead spending.  Approximately
    $5 million of savings are expected to be realized in the      
    fourth quarter of fiscal 2008;

  * Organizational streamlining, primarily involving a reduction
    of the company's headquarters staff by 225 filled and open
    positions or approximately 20%;

  * Anticipated total program cost, including severance-related
    benefits, of less than $4 million pre-tax, will be incurred
    largely in the company's fiscal third quarter ending
    April 30, 2008;

  * A reduction of planned capital spending from an expected
    $85 million in fiscal 2008 to approximately $45 million in
    fiscal 2009;

  * Continued optimization of company's store portfolio,
    including the closure of an additional 23 underperforming
    locations, bringing the total number of planned store closures
    to approximately 105 in fiscal 2008; and,

  * A $100 million reduction in inventory in fiscal 2008, which
    was announced previously.  The decrease in inventory levels
    was based on a detailed review by category and item and the
    company's intends to make the reduction permanent.

"In order to improve Zale's overall performance and provide our
value-oriented customer with an exceptional experience, it is
essential that we reduce the company's infrastructure costs, which
have outpaced its sales growth since 2002," Neal Goldberg, Zale
president and chief executive officer, said.  "The program we are
announcing follows an extensive review, and will enhance our
operational effectiveness significantly."

"It builds upon steps we have already taken to reduce
redundancies, simplify processes and create a more agile
company's, such as the realignment of our merchandise and sourcing
organizations," Mr. Goldberg continued.

"Creating a culture of cost discipline and financial rigor is
vital to Zale's ongoing success," Mr. Goldberg stated.  "While we
recognize that expense saves will help drive efficiencies in the
near-term, our ultimate success will come from optimizing the
balance between top-line growth, margin expansion and expense
control."

"These actions are difficult for our entire organization but are
important steps in order to connect us more closely to our
customers," Mr. Goldberg concluded.  "We thank our associates
affected by these changes for their dedication, hard work and
contributions."

                    Operating Savings Details

The company eliminated approximately 140 filled and 85 open
positions, representing approximately 20% of its headquarters
staff.  As a result of this action, the company expects to reduce
corporate staff payroll by approximately $15 million, or 20%, per
year, and non-selling field payroll by approximately $8 million.   
In addition, approximately $40 million of non-compensation
expenses such as consulting, marketing, and travel are planned to
be eliminated, representing 20% of such expenses, as well as
$2 million related to distribution.

Reflecting this expense reduction, the company expects to reduce
SG&A as a percent of sales by approximately 250 basis points for
fiscal 2009, as compared to the current fiscal year.

            Capital Reduction and Store Closing Details

The company's capital expenditures for fiscal 2009 are expected to
be $45 million, a reduction of $40 million from the $85 million
level the company expects for the current fiscal year.  Capital
expenditure reductions will be realized primarily from more
effective spending on store remodels, slower store growth in the
near-term and a deceleration of information technology
initiatives.

With the estimated $65 plus million in operating savings and
$40 million in capital expenditure reductions, the company's
expects a substantial increase in its free cash flow for fiscal
2009.

The store optimization component of the program involves the
closure in fiscal 2008 of approximately 105 locations, of which 95
are underperforming and 50 are kiosks.  These locations will close
primarily as leases mature; as such, the company's expects to
incur minimal exit costs.  Zale intends to maintain this financial
rigor as it evaluates its store portfolio on an ongoing basis.   
Even as the company's makes these reductions, it will continue to
commit to needed and profitable investments in the existing store
base, as well as dedicate its capital expenditures to brands
offering greater strategic opportunity and higher return on
investment.  Zale expects to exit its fiscal year 2008, which ends
July 31, 2008, with approximately 2,145 retail locations.

                       About Zale Corporation

Headquartered in Irving, Texas, Zale Corporation (NYSE:ZLC) --
http://www.zalecorp.com-- is a specialty retailer of fine jewelry  
in North America.  At July 31, 2007, the company's operated 1,471
specialty retail jewelry stores and 793 kiosks located mainly in
shopping malls throughout the United States, Canada and Puerto
Rico.  Zale Corporation operates under three business segments:
fine jewelry, kiosk jewelry and all other.  The fine jewelry
segment comprises six brands, each of which specializes in fine
jewelry and watches, with merchandise and marketing emphasis
focused on diamond products.  The kiosk jewelry segment operates
primarily under the brand names Piercing Pagoda, Plumb Gold,
Silver and Gold Connection through mall-based kiosks.  In all
other, it provides insurance and reinsurance facilities for
various types of insurance coverage through Zale Indemnity
company's, Zale Life Insurance company's and Jewel Re-Insurance
Ltd.  During the fiscal year ended July 31, 2007, the Fine Jewelry
segment generated approximately 89% of the company's net revenues.


* S&P Says 418 ABS Ratings Affected by Bond Insurer Rating Actions
------------------------------------------------------------------
Standard & Poor's Ratings Services initiated various rating and
CreditWatch actions on 418 U.S. asset-backed securities from 226
transactions as a result of recent rating and CreditWatch actions
on bond insurers Financial Guaranty Insurance Co., XL Capital
Assurance Inc., and MBIA Insurance Corp.
     
On Feb. 26, 2008, S&P lowered its long-term ratings on 64 U.S. ABS
classes to 'A' from 'AA'.  These ratings remain on CreditWatch
with developing implications.  The rating and CreditWatch actions
reflected the lowering of the financial enhancement ratings on
FGIC and its related entities to 'A' from 'AA' and the remaining
CreditWatch developing status of these ratings.  In addition,
seven U.S. ABS ratings were delinked from the rating on FGIC to
reflect the ability of the underlying collateral to withstand
stress scenarios consistent with a rating that is higher than the
rating on the insurance provider.
     
S&P lowered its ratings on 29 U.S. ABS classes to 'A-' from 'AAA'.
These ratings also remain on CreditWatch with negative
implications.  These actions followed the lowering of the
financial enhancement ratings on XLCA and its related entities to
'A-' from 'AAA' and the remaining CreditWatch negative status.   
Additionally, S&P delinked the ratings on 15 U.S. ABS classes from
the rating on XLCA to reflect the ability of the underlying
collateral to withstand stress scenarios consistent with a rating
that is higher than the rating on the insurance provider.
     
Furthermore, S&P affirmed its 'AAA' long-term ratings on 303 U.S.
ABS transactions with exposure to MBIA and removed them from
CreditWatch with negative implications.  These actions reflected
the affirmation of the ratings on MBIA and its related entities
and their removal from CreditWatch negative.
     
Standard & Poor's will continue to monitor the long-term ratings
and the underlying ratings for all affected U.S. ABS classes.   
Future rating actions may be warranted as the CreditWatch status
of the ratings on the monolines are resolved.  The following list
details the U.S. ABS asset types affected by the rating actions on
the bond insurance providers.

           U.S. ABS Ratings Affected by Monoline Actions

          Asset Type                   MBIA   XLCA     FGIC
          ----------                   ----   ----     ----
          12b-1                        0      0        8
          Aircraft                     6      0        4
          Auto - warehouse             2      0        0
          Auto loan                    51     20       25
          Commercial - other           5      0        0
          Consumer-other               1      1        0
          Credit card                  2      0        3
          Equipment                    0      3        1
          Esoteric asset               12     3        4
          Franchise loan               20     0        0
          Manufactured housing         19     0        0
          Marine                       2      0        0
          Railcar/container            3      0        2
          Recreational vehicles        0      0        2
          Rental cars                  17     7        3
          Single-issue synthetic       24     10       13
          Small business               8      0        0
          Structured settlement        24     0        0
          Student loan                 101    0        0
          Timeshare                    6      0        5
          Trade receivables            0      0        1
          ======================       ===    ==       ==
          Total                        303    44       71


* S&P Downgrades 85 Tranches' Ratings From 16 Cash Flows and CDOs
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 85
tranches from 16 U.S. cash flow and hybrid collateralized debt
obligation transactions.  S&P removed 79 of the lowered ratings
from CreditWatch with negative implications.  Additionally, S&P
affirmed its 'AAA' ratings on five classes and removed them from
CreditWatch negative.  The downgraded tranches have a total
issuance amount of $9.722 billion.  All of the affected
transactions are mezzanine structured finance CDOs of asset-backed
securities, which are CDOs of ABS collateralized in large part by
mezzanine tranches of residential mortgage-backed securities and
other SF securities.
     
The CDO downgrades reflect a number of factors, including credit
deterioration and recent negative rating actions on U.S. subprime
RMBS securities.
     
To date, including the CDO tranches listed below and including
actions on both publicly and confidentially rated tranches, S&P
has lowered its ratings on 2,027 tranches from 506 U.S. cash flow,
hybrid, and synthetic CDO transactions as a result of stress in
the U.S. residential mortgage market and credit deterioration of
U.S. RMBS.  In addition, 1,526 ratings from 357 transactions are
currently on CreditWatch negative for the same reasons.  In all,
the affected CDO tranches represent an issuance amount of
$348.805 billion.     

Standard & Poor's will continue to monitor the CDO transactions it
rates and take rating actions, including CreditWatch placements,
when appropriate.

Rating and Creditwatch Actions

                                            Rating
Transaction                    Class     To         From
Alpha Mezz CDO 2007-1 Ltd      II        BB+        AAA/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      III       B+         AA/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      IV        B+         AA-/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      SupSrSwap A+         AAA/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      V         CCC+       A/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      VI        CC         BBB/Watch Neg
Alpha Mezz CDO 2007-1 Ltd      VII       CC         BB+/Watch Neg
BFC Ajax CDO Ltd.              B         BBB+       AA-/Watch Neg
BFC Ajax CDO Ltd.              C         BBB-       BBB+/Watch Neg
BFC Ajax CDO Ltd.              D         B          BB+/Watch Neg
BFC Ajax CDO Ltd.              E         CC         B-/Watch Neg
BFC Ajax CDO Ltd.              X         BBB+       A-/Watch Neg
Bluegrass ABS CDO III Ltd.     A-1       AAA        AAA/Watch Neg
Bluegrass ABS CDO III Ltd.     A-2       A+         AAA/Watch Neg
Bluegrass ABS CDO III Ltd.     B         BBB-       AA/Watch Neg
Bluegrass ABS CDO III Ltd.     C         BB         A/Watch Neg
Bluegrass ABS CDO III Ltd.     D-1       CCC+       BBB/Watch Neg
Bluegrass ABS CDO III Ltd.     D-2       CCC+       BBB/Watch Neg
Broadwick Funding Ltd          A-1b      A+         AAA
Broadwick Funding Ltd          A-2       A+         AAA/Watch Neg
Broadwick Funding Ltd          B         BBB-       AA/Watch Neg
Broadwick Funding Ltd          C         BB         A/Watch Neg
Broadwick Funding Ltd          D         CCC+       BBB/Watch Neg
Duke Funding V Ltd.            II        AA-        AAA/Watch Neg
Duke Funding V Ltd.            III       BB+        AA/Watch Neg
Duke Funding V Ltd.            IV-A      CCC        BBB/Watch Neg
Duke Funding V Ltd.            IV-B      CCC        BBB/Watch Neg
Duke Funding XII Ltd.          A1        BB+        AAA/Watch Neg
Duke Funding XII Ltd.          A2        BB         AA/Watch Neg
Duke Funding XII Ltd.          A3        B-         A/Watch Neg
Duke Funding XII Ltd.          A-S1VFA   BBB+       AAA/Watch Neg
Duke Funding XII Ltd.          A-S1VFB   BBB+       AAA/Watch Neg
Duke Funding XII Ltd.          B1        CCC+       BBB+/Watch Neg
Duke Funding XII Ltd.          B2        CCC-       BBB/Watch Neg
Duke Funding XII Ltd.          B3        CC         BBB-/Watch Neg
Fort Point CDO II Ltd.         A-2       AAA        AAA/Watch Neg
Fort Point CDO II Ltd.         A-3       BBB+       AA/Watch Neg
Fort Point CDO II Ltd.         B         BBB-       A-/Watch Neg
Fort Point CDO II Ltd.         C         CCC+       BBB/Watch Neg
Kleros Real Estate CDO I Ltd   A-1       B          AAA/Watch Neg
Kleros Real Estate CDO I Ltd   A-2       CCC+       AA/Watch Neg
Kleros Real Estate CDO I Ltd   B         CCC        A+/Watch Neg
Kleros Real Estate CDO I Ltd   C         CC         BBB/Watch Neg
Knollwood CDO Ltd              A-1       AAA        AAA/Watch Neg
Knollwood CDO Ltd              A-2       BB+        AA+/Watch Neg
Knollwood CDO Ltd              B         CCC        A-/Watch Neg
Knollwood CDO Ltd              C         CC         CCC+/Watch Neg
Longport Funding II Ltd.       A1J       AA         AAA/Watch Neg
Longport Funding II Ltd.       A2        A+         AA/Watch Neg
Longport Funding II Ltd.       A3        BBB        A/Watch Neg
Longport Funding II Ltd.       B         B+         BBB/Watch Neg
Longport Funding II Ltd.       Combo Sec BBB        A/Watch Neg
Longport Funding II Ltd.       Incme Nts CC+       BB/Watch Neg
MKP Vela CBO Ltd.              A         CCC-       AAA/Watch Neg
MKP Vela CBO Ltd.              B         CC         AA/Watch Neg
MKP Vela CBO Ltd.              C         CC         A/Watch Neg
MKP Vela CBO Ltd.              D         CC         BBB/Watch Neg
MKP Vela CBO Ltd.              Super Sr  B          AAA/Watch Neg
MKP Vela CBO Ltd.              X-1       CC         BBB-/Watch Neg
MKP Vela CBO Ltd.              X-2       CC         BBB-/Watch Neg
Montauk Point CDO Ltd          A1        AA         AAA
Montauk Point CDO Ltd          A2        A-         AAA
Montauk Point CDO Ltd          B         BBB-       AA-/Watch Neg
Montauk Point CDO Ltd          C         BB+        A/Watch Neg
Montauk Point CDO Ltd          D         B+         BBB/Watch Neg
Montauk Point CDO Ltd          E         CCC+       BB/Watch Neg
Montauk Point CDO Ltd          F         CCC        B+/Watch Neg
Montauk Point CDO Ltd          G         CC         CCC+/Watch Neg
Pinetree CDO Ltd.              A-1J      A-         AAA/Watch Neg
Pinetree CDO Ltd.              A-2       BBB-       AA/Watch Neg
Pinetree CDO Ltd.              A-3       BB-        A/Watch Neg
Pinetree CDO Ltd.              B         CCC-       BB/Watch Neg
Pyxis ABS CDO 2006-1 LLC       A-1       CCC+       AA/Watch Neg
Pyxis ABS CDO 2006-1 LLC       A-2       CCC-       A+/Watch Neg
Pyxis ABS CDO 2006-1 LLC       B         CC         BBB/Watch Neg
Pyxis ABS CDO 2006-1 LLC       C         CC         B/Watch Neg
Pyxis ABS CDO 2006-1 LLC       D         CC         CCC-/Watch Neg
Pyxis ABS CDO 2006-1 LLC       UnfunSpr  BB+        AAA/Watch Neg
Tabs 2005-4 Ltd.               A         AA         AAA
Tabs 2005-4 Ltd.               B         BBB        AAA
Tabs 2005-4 Ltd.               C         BB+        AA
Tabs 2005-4 Ltd.               D         BB         A/Watch Neg
Tabs 2005-4 Ltd.               E         CCC+       BBB-/Watch Neg
Vertical ABS CDO 2006-1 Ltd    A-1       BBB        AAA/Watch Neg
Vertical ABS CDO 2006-1 Ltd    A-2       BB-        AA/Watch Neg
Vertical ABS CDO 2006-1 Ltd    A-3       CCC+       A/Watch Neg
Vertical ABS CDO 2006-1 Ltd    A-S1VF    A+         AAA/Watch Neg
Vertical ABS CDO 2006-1 Ltd    B         CC         BBB/Watch Neg
Vertical ABS CDO 2006-1 Ltd    Cl 1 Cmbo AAA        AAA/Watch Neg
Vertical ABS CDO 2006-1 Ltd    Cl 2 Cmbo AAA        AAA/Watch Neg

                     Other Outstanding Ratings

    Transaction                          Class        Rating
    -----------                          -----        ------       
    BFC Ajax CDO Ltd.                    A            A/Watch Dev
    Broadwick Funding Ltd                S            AAA      
    Duke Funding V Ltd.                  1-A2         AAA    
    Duke Funding V Ltd.                  I-A1         AAA    
    Duke Funding V Ltd.                  I-B          AAA    
    Duke Funding V Ltd.                  I-W          AAA    
    Fort Point CDO II Ltd.               A-1          AAA    
    Kleros Real Estate CDO I Ltd         D            CC     
    Longport Funding II Ltd.             A1S          AAA     
    Pinetree CDO Ltd.                    A-1S         AAA     
    Pyxis ABS CDO 2006-1 LLC             X            CC


* Ropes & Gray Opens Chicago Office and Welcomes Three Partners
---------------------------------------------------------------
Marking the latest step in its strategic expansion into key legal
markets, Ropes & Gray, a national law firm, disclosed the opening
of a new office in Chicago.  Joining the firm as partners are
James T. Lidbury, Esq., Jonathan M. Grandon, Esq. and Deborah A.
Monson, Esq., all formerly partners at Mayer Brown in Chicago.

Mssrs. Lidbury and Grandon's practices focus on mergers and
acquisitions, private equity transactions, and corporate and
securities matters.  Ms. Monson's practice focuses on investment
management, including hedge funds and commodities matters.

"This is an exciting development for Ropes & Gray," R. Bradford
Malt, chairman of Ropes & Gray, said.  "We see in Chicago and the
entire Midwest region a significant opportunity to continue our
strategic growth into attractive markets.  We expect that this
office will grow rapidly in the near term.  David Chapin and John
Ayer, two Boston-based private equity partners, will be spending
significant time in the Chicago office to facilitate integration
and practice development."

"Jim and Jon are widely recognized for the quality of their
transaction work, and they have an outstanding reputation for
client service, advising an array of clients on a broad range of
M&A-related work, governance issues and strategic initiatives,"
Mr. Malt added.  "We are also delighted that Debbie will be
joining our preeminent investment management practice.  They are
all remarkably talented lawyers who will contribute substantially
to our new office.  We look forward to working with our new
colleagues in this exciting new endeavor."

"Jon, Debbie and I welcome the opportunity to join Ropes & Gray,
and we look forward to capitalizing on the many opportunities to
bring superior service to clients here in Chicago and across the
country," Mr. Lidbury said.  "Our initial focus will be on serving
the needs of clients throughout the country and on building a
full-service team of outstanding lawyers in Chicago in keeping
with Ropes & Gray's culture of excellence, collegiality and
unstinting client service."

Before joining Mayer Brown in 1994, Mr. Lidbury was an attorney in
the U.S. Securities & Exchange Commission's Division of Corporate
Finance.  He was named to the 2008 BTI Transactions "Super All-
Star Team" as one of the top three M&A lawyers in the United
States.

The 2007 edition of the respected Chambers USA guide cited Jim's
"fantastic disposition, intellect and judgment," and said "his
peers appreciate his 'reasonable and cooperative' approach."  He
earned his undergraduate and law degrees from Northwestern
University.  He is admitted to practice in Illinois, New York
and the District of Columbia.

Mr. Grandon joined Mayer Brown in 2004.  He earned his
undergraduate degree from Columbia University and his law degree
from the University of Michigan Law School.  Before joining Mayer
Brown, Grandon was an associate at Simpson Thacher in New York. He
is admitted to practice in Illinois and New York.

Ms. Monson joined Mayer Brown in 1994.  She earned her
undergraduate degree from Princeton University and law degree from
the University of Michigan.  Before joining Mayer Brown, Monson
was an attorney at Schiff Hardin & Waite in Chicago. She is
admitted to practice in Illinois.

With the new Chicago office, Ropes & Gray now has seven locations
in preeminent centers of business and finance. In October 2007,
Ropes & Gray opened an office in Tokyo, Japan.

                      About Ropes & Gray

Headquartered in Boston, Massachusetts, Ropes & Gray LLP --
http://www.ropesgray.com/-- provides comprehensive legal services  
to businesses and individuals around the world.  Clients benefit
from expertise combined with unwavering standards for integrity,
service, and responsiveness.  With offices in preeminent centers
of finance, technology and government, Ropes & Gray is ideally
positioned to address most pressing legal and business issues.
Capabilities include antitrust, bankruptcy and business
restructuring, corporate mergers and acquisitions, employee
benefits, environmental, health care, intellectual property and
technology, international, investment management, labor and
employment, life sciences, litigation, private equity and venture
capital, private client services, real estate and tax.


* BOOK REVIEW: Inside Investment Banking: Second Edition
--------------------------------------------------------
Author:     Ernest Bloch
Publisher:  Beard Books
Softcover:  440 Pages
List Price: $34.95

Order your personal copy at
http://www.amazon.com/exec/obidos/ASIN/1587982684/internetbankrupt

Even though Bloch states that "no last word may ever be written
about the investment banking industry," he nonetheless has written
a definitive book on the subject.

Bloch wrote Inside Investment Banking after discovering that no
textbook on the subject was available when he began teaching a
course on investment banking.  Bloch's book is like a textbook,
though one not meant to be limited to classroom use.  It's a
complete, knowledgeable study of the structure and operations of
the field of investment banking.  With a long career in the field,
including work at the Federal Reserve Bank of New York, Bloch has
the background for writing the book.  He sought the input of many
of his friends and contacts in investment banking for material as
well as for critical guidance to put together a text that would
stand the test of time.

While giving a nod to today's heightened interest in the
innovative securities that receive the most attention in the
popular media, Inside Investment Banking concentrates for the most
part on the unchanging elements of the field.  The book takes a
subject that can appear mystifying to the average person and makes
it understandable by concentrating on its central processes,
institutional forms, and permanent aims.  The author shows how all
aspects of the complex and ever-changing field of investment
banking, including its most misunderstood topic of innovative
securities, leads to a "financial ecology" which benefits business
organizations, individual investors in general, and the economy as
a whole.  "[T]he marketplace for innovative securities becomes,
because of its imitators, a systematic mechanism for spreading
risk and improving efficiency for market makers and investors,"
says Bloch.

For example, Bloch takes the reader through investment banking's
"market making" which continually adapts to changing economic
circumstances to attract the interest of investors.  In doing so,
he covers the technical subject of arbitrage, the role of the
venture capitalist, and the purpose of initial public offerings,
among other matters.  In addition to describing and explaining the
abiding basics of the field, Bloch also takes up issues regarding
policy (for example, full disclosure and government regulation)
that have arisen from the changes in the field and its enhanced
visibility with the public.  In dealing with these issues, which
are to a large degree social issues, and similar topics which
inherently have no final resolution, Bloch deals indirectly with
criticisms the field has come under in recent years.

Bloch cites the familiar refrain "the more things change, the more
they remain the same" and then shows how this applies to
investment banking. With deregulation in the banking industry,
globalization, mergers among leading investment firms, and the
growing number of individuals researching and trading stocks on
their own, there is the appearance of sweeping change in
investment banking.  However, as Inside Investment Banking shows,
underlying these surface changes is the efficiency of the market.

Anyone looking for an authoritative work covering in depth the
fundamentals of the field while reflecting both the interest and
concerns about this central field in the contemporary economy
should look to Bloch's Inside Investment Banking.

After time as an economist with the Federal Reserve Bank of New
York, Ernest Bloch was a Professor of Finance at the Stern School
of Business at New York University.

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Joseph Medel C. Martirez, Ludivino Q. Climaco, Jr., Loyda I.
Nartatez, Philline P. Reluya, Shimero R. Jainga, Joel Anthony G.
Lopez, Tara Marie A. Martin, Melanie C. Pador, Ronald C. Sy, Cecil
R. Villacampa, Ma. Cristina I. Canson, Christopher G. Patalinghug,
Frauline S. Abangan, and Peter A. Chapman, Editors.

Copyright 2008.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
at 240/629-3300.

                    *** End of Transmission ***