/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/080310.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, March 10, 2008, Vol. 12, No. 59 Headlines 100 KING: Case Summary & Four Largest Unsecured Creditors ABUNDANT LIFE: Voluntary Chapter 11 Case Summary ACLC FRANCHISE: Fitch Retains 'C/DR6' Ratings on Six Classes AEROMED SERVICES: Files Schedules of Assets and Liabilities AES-STELLAR INC: Case Summary & 20 Largest Unsecured Creditors AIRBORNE HEALTH: Waiver Request Termination Cues S&P's Junk Rating AMERICAN AXLE: Ongoing Strike Cues Closure of GM's Missouri Plant AMERICAN COLOR: Gets Waivers of Defaults Under 1st Lien Facilities AMERICAN GOLF CARS: Case Summary & 8 Largest Unsecured Creditors AMERICAN HOME: Wants Exclusive Periods Stretched to June 2, 2008 AMERICAN HOME: Wants to Employ PwC as Tax Advisors AMF BOWLING: Moody's Holds B2 Rating; Changes Outlook to Negative ANN-LEE CONSTRUCTION: Case Conversion Trial Continues on April 8 AQUILA INC: Permit to Build South Harper Facilities Canceled ARROW ELECTRONICS: To Buy Achieva's Components Distribution Biz ATHERTON FRANCHISE: Fitch Holds 'B' Rating on 1998-A Cl. D Trusts AUSTINBURG PROPERTIES: Voluntary Chapter 11 Case Summary BALDO CISNEROS: Case Summary & 20 Largest Unsecured Creditors BARNET HOSPITAL: Sells All Assets to Community Healthcare BEAR STEARNS: Whicker & Breighton Continue as Joint Liquidators BECKMAN COULTER: Fitch Holds 'BB-' Rating on $109.7MM Cl. A Loans BLACKHAWK AUTOMOTIVE: Court Approves Asset Sale to Flex-N-Gate BUILDING MATERIALS: Declining Sales Cue Moody's Ratings Cuts to B2 CAPRI CONDOMINIUMS: Wants to Hire Kingery & Crouse as Accountant CARAUSTAR INDUSTRIES: S&P Chips Ratings to 'B-' on Weak Earnings CARLYLE CAPITAL: Misses Margin Calls and Gets Notice of Default CARLYLE CAPITAL: Continuing Talks with Lenders on Financial Woes CASA DE CAMBIO: Case Summary & 20 Largest Unsecured Creditors CASELLA WASTE: Posts $4.6 Mil. Net Loss for the 2008 Third Quarter CHAMP CAR: Goes Bankrupt, Plans to Sell Assets to Indy Racing CHINA AOXING: To Restate Financial Statements to Correct Errors CLEAR CHANNEL: Extends Closing of Notes Tender Offer to March 18 CNL FUNDING: Fitch Chips Ratings on Three Certificate Classes CONTINENTAL AIRLINES: Pilots Rally on March 12 in Support of Talks COUNTRYWIDE HOME: S&P Takes Various Rating Actions on RMBS Deals CUMULUS MEDIA: Agrees to Amend Credit Deal to Consummate Merger DURA AUTOMOTIVE: Files Revised Plan of Reorganization DURA AUTOMOTIVE: Wants to Hire SRR as Valuation Consultant EMAC OWNER: Fitch Cuts Ratings to CC from CCC on Three Classes FALCON FRANCHISE: Fitch Affirms Low-B Ratings on Six Loan Classes FEDERAL-MOGUL: Inks New Stock Option Pact with CEO Jose Alapont FIELDSTONE MORTGAGE: Committee Wants to Hire Arent Fox as Counsel FIELDSTONE MORTGAGE: U.S. Trustee Forms 3-Member Creditors Panel FFCA SECURED: Fitch Takes Rating Actions on Various Classes FMAC LOAN: Fitch Retains Junk Ratings on 43 Classes FORD MOTOR: To Give Out Performance Bonuses to All Employees FORD MOTOR: Luxury Brands Buyer Says Won't Flip Jaguar FORTUNOFF: Three Creditors Want Their Goods Returned FORTUNOFF: Obtains Permission to Pay Existing Insurance Policies FORTUNOFF: Court Bars Utility Providers From Refusing Service GEA SEASIDE: Voluntary Chapter 11 Case Summary GENERAL MOTORS: Restores CEO's Pay to 2003 Level of $2.2 Million GENERAL MOTORS: Closes Wentzville Plant Over Axle Workers' Strike GENERAL MOTORS: 18 Plants to Lay Off Workers Due to Axle Strike GENERAL MOTORS: Contracts Provide for Union Workers When Laid-Off GEORGE FAISON: Case Summary & Seven Largest Unsecured Creditors GLOBAL FRANCHISE: Fitch Holds 'BB' Rating on Class A-3 Trusts GOLDEN STATE: Taps Pinnacle as Bankruptcy Counsel GOLDEN STATE: Files Schedules of Assets and Liabilities GOLDEN STATE: Sec. 341 Meeting of Creditors Set for March 17 GOLDEN STATE: June 16 General Claims Bar Date Set GREEKTOWN HOLDINGS: S&P Puts 'B' Corp. Rating on Negative Watch HANOVER SECURITIES: SIPC Moves for Liquidation Under Chapter 7 HIGH GRADE: Poor Credit Quality Prompts Moody's Rating Downgrades HOLLEY PERFORMANCE: Can Access Cash Collateral on Final Basis HOLLEY PERFORMANCE: Gets Final Okay to Use $60 Mil. DIP Financing INTERSTATE BAKERIES: Various Parties Oppose Plan Confirmation INTERSTATE BAKERIES: Teamsters Inks Deal with Ripplewood INTERSTATE BAKERIES: Wants to Move Confirmation Hearing to Apr. 23 INVACARE CORP: Names Robert K. Gudbranson as CFO ISLE OF CAPRI: S&P Designates 'BB-' Rating on Negative CreditWatch JACK ABERMAN: Case Summary & Nine Largest Unsecured Creditors J-TAIL LLC: Involuntary Chapter 11 Case Summary JEFFERSON COUNTY: In Technical Default on Swap Agreements JEFFERSON COUNTY: S&P Junks Sewer Revenue Debt Rating KEY DEVELOPERS: Section 341(a) Meeting Slated for April 2, 2008 LINENS 'N THINGS: Weak Liquidity Prompts Moody's to Junk Ratings LIONEL LLC: Wants Court to Defer Confirmation Hearing to March 27 LUCHT'S CONCRETE: Case Summary & 17 Largest Unsecured Creditors MARSHALL HILL: Case Summary & 20 Largest Unsecured Creditors MEDIANEWS GROUP: Worsening Cash Flow Cues S&P's Rating Cut to 'B-' MORGAN STANLEY: Fitch Affirms 'B' Rating on Class D Trusts MOVIE GALLERY: Court Okays $4.7 Million Employee Incentive Plan MOVIE GALLERY: Committee Supports Second Amended Chapter 11 Plan MOVIE GALLERY: Judge Tice Approves Phase 2 Sale Procedures NEW GENERATION: Case Summary & 11 Largest Unsecured Creditors OSI RESTAURANT: Weak Performance Cues Moody's to Hold 'B2' Rating PARKWAY HOSPITAL: Ends Three-Year Term Under Chapter 11 Protection PEACHTREE FRANCHISE: Fitch Holds 'B/DR1' Rating on Class B Notes PELL CITY: Case Summary & 20 Largest Unsecured Creditors PFP HOLDINGS: Wants to Employ Odyssey Capital as Financial Advisor PINNACLE ENT: Profile Growth Prompts Fitch to Hold 'B' ID Rating PRB ENERGY: Plans to Continue Operations Amid Bankruptcy Filing PROPEX INC: Committee Wants FTI Consulting as Financial Advisor REAL MEX: Moody's Junk Corp. Family Rating on Liquidity Concerns REGAL ENT: Prices Debt Offering of $190 Mil. Convertible Sr. Notes REGAL ENT: S&P Changes Outlook to Stable; Maintains 'BB-' Rating ROCK-TENN CO: Expands Business with Southern Container Buyout RYLAND GROUP: Accused by Regulator of Dubious Lending Practices S&A CORP: Court Approves Hiring of Orson Woodall as Legal Counsel S&A CORP: Sec. 341 Meeting of Creditors Set for March 13 S&A CORP: General Claims Bar Date Set for June 11 SHARPER IMAGE: Landlords Object to $60M DIP Financing Motion SHARPER IMAGE: Wants to Employ Conway Del Genio as Managers SHARPER IMAGE: Wants to Employ Weil Gotshal as Lead Counsel SHARPER IMAGE: Wants to Employ Womble Carlyle as Co-Counsel SHARPER IMAGE: Director Steven A. Lightman Resigns SIRVA INC: Triple Net Seeks Appointment of Class 5 Committee SIRVA INC: Asks Authority from Court to Sell UK & Ireland Units SCOTTISH RE: May Sell Life Reinsurance & Wealth Management Units SPRINGS WINDOW: Moody's Cuts Rating to 'B2' on Weak 2007 Results STATION CASINOS: Posts $375.6 Million Net Loss in 2007 STRADA 315: Regions Bank Wants Court to Appoint an Examiner STRUG LLC: Voluntary Chapter 11 Case Summary SUN HEALTHCARE: Posts $35.3 Mil. Earnings for 2007 Fourth Quarter SUNCO PRODUCTS: Case Summary & 20 Largest Unsecured Creditors SUPERCLICK INC: Jan. 31 Balance Sheet Upside-Down by $1,327,595 THORNBURG MORTGAGE: KPMG Says Feb. 2008 Audit Report Unreliable THORNBURG MORTGAGE: Cross-defaults Cue Moody's Rating Cut to 'Ca' THORNBURG MORTGAGE: S&P Slashes Senior Unsec. Debt Rating to 'CC' THORNBURG MORTGAGE: Fitch Slashes ID Rating to 'RD' from CCC THORNBURG MORTGAGE: Signs Reverse Repurchase Agreements UNIVISION COMMS: Sells Recording and Publishing Business to UMG UNIVISION COMMS: S&P Cuts Rating on Low Asset Sale Proceeds UNIVISION COMM: Posts US$314.8 Million Net Loss in 2007 USG CORP: Completes Payment to Asbestos Personal Injury Trust USG CORP: Pays $40M for Property Damage Settlements in 2007 VILLA CASABLANCA: Case Summary & Eight Largest Unsecured Creditors VOLT INFO: Inks New Credit Agreement for $42M Unsecured Facility VONAGE HOLDINGS: Reveals $1.4M Spending in Lobbying Activities VYTERIS INC: Receives $1,836,909 from Warrants Conversion WACHOVIA BANK: S&P Puts Six Low-B Ratings on Negative Watch WALKUP FENCE: Case Summary & 17 Largest Unsecured Creditors WELLS FARGO: S&P Junks Ratings on Certificates WILLIAM OWEN: Case Summary & 12 Largest Unsecured Creditors * S&P Downgrades Ratings on 23 Classes From Four 2005 RMBS Deals * Fitch Says US Auto-Loan ABS Performance Has Improved Slightly * Fitch Says Corp. Finance Rtng. Activity Shows Increased Stress * Fitch Notes Rapid Deterioration in US Housing Market Conditions * Moody's Comments on ABCP Program, Financial Guarantors Ratings * Moody's Says American, European Bond Protection Level Differs * Moody's Says ARS Issuers Could Avoid Credit Impact of Disruption * Global Default Rate Reaches 1.3% in February, Moody's Reports * S&P Downgrades 69 Tranches' Ratings From 14 Cash Flows and CDOs * S&P Puts Ratings on 115 Classes of NIMS on Negative CreditWatch * Jean L'Homme Joins Proskauer Rose as Banking & Finance Partner * Proskauer Rose Admits Jennifer A. Camacho as Partner in Boston * BOND PRICING: For the Week of Feb. 25 - Feb. 29, 2008 ********* 100 KING: Case Summary & Four Largest Unsecured Creditors --------------------------------------------------------- Debtor: 100 King LC 101 South Union Street Alexandria, VA 22314 Bankruptcy Case No.: 08-11068 Chapter 11 Petition Date: March 4, 2008 Court: Eastern District of Virginia (Alexandria) Debtor's Counsel: Steven H. Greenfeld, Esq. Cohen Baldinger & Greenfeld LLC 7910 Woodmont Avenue Suite 760 Bethesda, MD 20814 Tel: 301-881-8300 Fax: 301-881-8350 steveng@cohenbaldinger.com Estimated Assets: $1,000,001 to $10 million Estimated Debts: $1,000,001 to $10 million Debtor's list of its Four Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Peter Mallios $800,000 12606 Hill Creek Lane Potomac, MD 20854 BB & T 1909 K. Street, NW $586,166 Second Floor Washington, DC 20006 American Energy Restaurant $286,816 Equipment 7538 Fullerton Court Springfield, VA 221153 Genops Construction $75,000 City of Alexandria $38,810 ABUNDANT LIFE: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Abundant Life Ministries 15912 Lincoln Avenue Harvey, IL 60426 Bankruptcy Case No.: 08-05315 Type of Business: The Debtor is a religious organization. Chapter 11 Petition Date: March 6, 2008 Court: Northern District of Illinois (Chicago) Judge: Susan Pierson Sonderby Debtor's Counsel: Karen J. Porter, Esq. (kjplawnet@aol.com) Porter Law Network 11 East Adams Street, Suite 906 Chicago, IL 60603 Tel: (312) 673-0333 Fax: (312) 893-7370 Estimated Assets: Unknown Estimated Debts: $1 million to $10 million The Debtor did not file a list of its largest unsecured creditors. ACLC FRANCHISE: Fitch Retains 'C/DR6' Ratings on Six Classes ------------------------------------------------------------ Fitch Ratings has taken rating actions on the ACLC Franchise Loan Receivables Trusts and ACLC Business Loan Receivables Trusts listed below: ACLC Franchise Loan Receivables Trust 1997-A: -- Class A-1 currently rated at 'AAA' and remains on Rating Watch Negative; -- Class A-2 currently rated at 'AAA' and remains on Rating Watch Negative. ACLC Franchise Loan Receivables Trust 1997-B: -- Class A-1 currently rated at 'AAA' and remains on Rating Watch Negative; -- Class A-3 currently rated at 'AAA' and remains on Rating Watch Negative. ACLC Business Loan Receivables Trust 1998-1: -- Class A-3 remains at 'C/DR6'. ACLC Franchise Loan Receivables Trust 1998-A: -- Class A-2 affirmed at 'A'; -- Class A-3 affirmed at 'B/DR1'. ACLC Business Loan Receivables Trust 1998-2: -- Class A-3 affirmed at 'BBB'; -- Class B downgraded to 'CC/DR4' from 'CCC/DR3'; -- Class C remains at 'C/DR6'. ACLC Business Loan Receivables Trust 1999-1: -- Class A-3 downgraded to 'B/DR1' from 'BB'; -- Class B remains at 'C/DR6'; -- Class C remains at 'C/DR6'; ACLC Business Loan Receivables Trust 1999-2: -- Class A-3A affirmed at 'AA'; -- Class A-3F affirmed at 'AA'; -- Class B affirmed at 'BBB'; -- Class C affirmed at 'BB'; -- Class D remains at 'CCC'/DR2'. ACLC Business Loan Receivables Trust 2000-1: -- Class A-3A downgraded to 'BBB' from 'A+'; -- Class A-3F downgraded to 'BBB' at 'A+'; -- Class B downgraded to 'CC/DR3' from 'CCC/DR3'; -- Class C downgraded to 'C/DR6' from 'CC/DR5'; -- Class D remains at 'C/DR6'. The affirmations for series 1997-A and 1997-B are based on the strength of an MBIA insurance policy. Fitch's analysis incorporated anticipated losses on defaulted collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral- specific recoveries experienced in the franchise loan asset-backed securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to asses the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, anticipated losses were found to have increased since last review for the ACLC Business Loan Receivables Trusts 1998-2, 1999-1 & 2000-1, resulting in negative rating actions. Remaining transactions were found to have credit support consistent with Fitch's previous review leading to the affirmation of the current ratings. AEROMED SERVICES: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Aeromed Services Corp. filed with the U.S. Bankruptcy Court for the District of Puerto Rico, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $135,000.00 B. Personal Property 2,504,407.12 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $78,780.50 E. Creditors Holding Unsecured Priority Claims 11,648.70 F. Creditors Holding Unsecured Non-priority Claims 3,756,833.25 ----------- ------------ TOTAL $2,639,407.12 $3,847,262.45 About Aeromed Services Corp. Headquartered in San Juan, Puerto Rico -- Aeromed Services Corp. -- http://www.aeromedems.com/-- offers ambulance services. The company filed for protection on Jan. 31, 2008 (Bankr. D. P.R. Case No. 08-00518). Alexis Fuentes Hernandez, Esq. represents the Debtor in its restructuring efforts. When the company filed for protection against it creditors, it listed US$1 million to US$100 million in assets and US$1 million to US$100 million in debts. AES-STELLAR INC: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: AES-Stellar Inc. 14012 Califa Street Van Nuys, CA 91401 Bankruptcy Case No.: 08-11309 Chapter 11 Petition Date: March 4, 2008 Court: Central District Of California (San Fernando Valley) Judge: Geraldine Mund Debtor's Counsel: Robert M. Yaspan, Esq. Law Offices of Yaspan & Thau 21700 Oxnard Street Ste. 1750 Woodland Hills, CA 91367 Tel: 818-905-7711 Fax: 818-501-7711 tmenachian@yaspanthau.com Estimated Assets: less than $50,000 Estimated Debts: $1,000,001 to $10 million Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Gold Pleasure Industrial Co. $1,615,484 7F, 1067 King's Road Hong Kong Alto $6,023 2867 Surveyor Street Pomona, CA 91768 Unity Property Investments $4,700 16039 Loukelton Street Industry, CA 91744 FedEx $2,000 South Bay Distribution $1,341 Netzel Associates Inc. $1,092 EDI Express $1,054 Banghart-Corin & Associates $769 Kahn & Comings, Inc. $713 Man Fu Yeung $653 CMA Inc. $647 Ronnie Yeung $461 Maan Yoong $399 Linda Lee Ying Cheung $392 Primus $300 Anna L. Hernandez $256 Gregory W. Crist $248 Dot-Line Transportation $162 Paychex $137 AT&T $70 AIRBORNE HEALTH: Waiver Request Termination Cues S&P's Junk Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings on Bonita Springs, Florida based Airborne Health Inc., including its corporate credit rating to 'CCC+' from 'B-'. At the same time, the ratings were removed from CreditWatch, where they had been placed with negative implications on Jan. 17, 2008. The outlook is developing. "The downgrade follows Airborne's termination of a waiver request for continued access to its $20 million revolving credit facility for a 45-day period, ahead of an anticipated financial covenant default for the quarter ended Jan. 31, 2008," said Standard & Poor's credit analyst Bea Chiem. "And we're concerned about the company's future sales volume following recent negative publicity surrounding its $23 million settlement of a class action lawsuit." The company continues to experience weak operating performance from unseasonably warm weather during the peak cold weather season that lowered demand for preventative products, and leverage is very high. At Dec. 31, 2007, total leverage (including preferred stock) was nearly 7x, up from about 4.5x at the fiscal year-end April 30, 2007. Presently, Airborne's liquidity is adequate. However, Standard & Poor's is concerned about the company's ability to maintain access to its revolver and possibly obtain an amendment in the near term, given current market conditions and the company's operating and negative publicity challenges. While the class action settlement amount has already been accrued, Standard & Poor's expects that the company will need to seek an amendment or waiver after March 15, 2008, when it will most likely violate its financial covenants. AMERICAN AXLE: Ongoing Strike Cues Closure of GM's Missouri Plant ----------------------------------------------------------------- The continuing strike at American Axle & Manufacturing Inc. prompted General Motors Corp. to cease operations at its Wentzville, Missouri facility on Thursday, according to various reports. The strike at American Axle is already at its two-week stretch and no agreement has been reached as of press time. American Axle indicated on its Web site that would resume contract negotiations with the United Auto Workers at noon on Thursday, March 6, 2008. No further details on the American Axle-UAW negotiation was provided. GM has about 20 facilities affected by the strike at American Axle as the supplier attempts to negotiate with the United Auto Workers. The Wentzville facility is one of the five additional facilities that GM intends to close, apart from the already closed six facilities. The other four facilities will be closed this week, reports relate. The Wentzville facility manufactures Chevrolet Express and GMC Savanna and has 2,000 workers. Around 20%, or more than 20,000, of GM's workers at its North American operations have been affected by the plant closures. Two Plants Idled Over Axle Dispute As reported in the Troubled Company Reporter on March 5, 2008, two additional production facilities in Moraine, Ohio, and Mishawaka, Indiana, have been affected by the labor dispute between the UAW union and key supplier American Axle, according to a GM production statement. A Toledo Transmission plant is anticipated to be shutdown on March 10, 2008, and is expected 1,444 hourly and 219 salaried workers to be laid off. The TCR related on March 3, 2008, two more GM plants are likely to shutter this week as supplier American Axle continues to negotiate with UAW union workers on strike. 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 on February 28. A day after, GM production factories in Flint, Michigan, Fort Wayne, Indiana, and Oshawa, Ontario, were idled after the second shift, displacing a total of 9,503 hourly and salaried workers. UAW president Ron Gettelfinger and Vice President James Settles disclosed that members at American Axle began an unfair labor practices strike at on Feb. 26, 2008, following expiration of a four-year master labor agreement. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. About American Axle Headquartered in Detroit, Michigan, American Axle & Manufacturing Holdings Inc. (NYSE:AXL) -- http://www.aam.com/-- and its wholly owned subsidiary, American Axle & Manufacturing, Inc., manufactures, engineers, designs and validates driveline and drivetrain systems and related components and modules, chassis systems and metal-formed products for light trucks, sport utility vehicles and passenger cars. In addition to locations in the United States (in Michigan, New York and Ohio), the company also has offices or facilities in Brazil, China, Germany, India, Japan, Luxembourg, Mexico, Poland, South Korea and the United Kingdom. * * * As reported in the Troubled Company Reporter on Feb. 28, 2008, Standard & Poor's Ratings Services said that its ratings on American Axle and Manufacturing Holdings Inc. (BB/Negative/--) are not immediately affected by reports that the United Auto Workers labor union, elected to conduct a work stoppage at the expiration of its four-year master labor agreement with American Axle. As reported in the Troubled Company Reporter on Nov. 27, 2007, Moody's Investors Service affirmed American Axle & Manufacturing Holdings, Inc.'s Corporate Family rating of Ba3 as well its senior unsecured rating of Ba3 to American Axle & Manufacturing Inc.'s notes and term loan. At the same time, the rating agency revised the rating outlook to stable from negative and renewed the Speculative Grade Liquidity rating of SGL-1. AMERICAN COLOR: Gets Waivers of Defaults Under 1st Lien Facilities ------------------------------------------------------------------ American Color Graphics Inc. disclosed in a regulatory filing dated March 5, 2008, that certain provisions of the company's existing first lien bank credit facilities were amended or waived to temporarily waive through and including June 6, 2008, any default under such bank credit facilities resulting from non- compliance with the first lien coverage ratio covenant in each such bank credit facility as of Sept. 30 and Dec. 31, 2007, and March 31, 2008, for all purposes of such bank credit facilities. Such amendment and waiver also: (a) waived through and including June 6, 2008, the requirement that the company repay the the $5.0 million supplemental term loan under its existing first lien term loan facility, (b) permitted the indebtedness and liens under the March 2008 Facility, (c) amended the requirement that the company maintain certain daily levels of minimum total availability under its bank credit facilities going forward, (d) requires that the company maintain certain daily levels of minimum total indebtedness under the March 2008 Facility going forward, and (e) waived through and including June 6, 2008, the company's noncompliance with its obligation thereunder to deliver its consolidated financial statements for the fiscal years ended March 31, 2007 and 2008, accompanied by a report or opinion of its independent certified public accountants that was not subject to any "going concern" explanatory paragraph. Such waivers of defaults are terminable upon the earliest to occur of: (a) the occurrence of any other default or event of default under the company's existing first lien bank credit facilities, (b) the occurrence of any default or event of default under the March 2008 Facility not waived or cured within the applicable grace period, if any, and (c) the failure of the company to consummate the Consent Solicitation by March 14, 2008, in accordance with its terms. The company has agreed to pay consenting lenders an aggregate amendment fee of $850,000 in connection with such amendments on June 6, 2008, subject to earlier payment under certain circumstances. On March 3, 2008, the company, as borrower, and ACG Holdings and certain subsidiaries of the company, as guarantors, entered into an additional credit facility with Special Situations Investing Group Inc., as administrative agent, and certain lenders party thereto providing for additional term loans in an aggregate principal amount not to exceed $8.0 million. An initial borrowing of $3.0 million under the March 2008 Facility was consummated on March 5, 2008. All borrowings under the March 2008 Facility mature upon the earliest to occur of: (a) Jan. 15, 2010, (b) the fifth day after an acceleration of the company's existing first lien term loan and revolving credit facility as a result of an event of default thereunder, (c) consummation of a merger with or other acquisition by an unaffiliated third party reasonably acceptable to the March 2008 Facility Lenders, and (d) consummation of a recapitalization of ACG Holdings or the company involving the repayment in full or other refinancing of the company's existing first lien term loan and revolving credit facility. Obligations under the March 2008 Facility are senior obligations of the company, ACG Holdings and each of the subsidiary guarantors and will be secured by a lien on all collateral securing the company's existing first lien bank credit facilities, subject to certain exceptions. The security interest under the March 2008 Facility in the March 2008 Facility Collateral will rank (a) second in priority to the lien of the company's existing first lien bank credit facilities in the March 2008 Facility Collateral and (b) prior to the lien of the Notes in the March 2008 Facility Collateral. The March 2008 Facility includes various affirmative and negative covenants and events of default, which are substantially the same as those contained in the company's existing first lien bank credit facilities. The ability of the March 2008 Facility Lenders to declare a default or otherwise enforce remedies as a result of any failure of the company to comply with these covenants is suspended for so long as borrowings under the company's first lien bank credit facilities are outstanding. On March 3, 2008, the Indenture for the 2010 Notes and the 2008 Notes was amended by the First Supplemental Indenture to permit the indebtedness and liens under the March 2008 Facility. On March 5, 2008, the company commenced a Consent Solicitation seeking consents from holders of the 2008 Notes to proposed amendments to the 2008 Notes to, among other things: (a) extend the maturity date of the 2008 Notes from March 15, 2008, until the later of (i) June 15, 2008, and (ii) the date on which the interest payment due June 15, 2008, in respect of the 2010 Notes is due and payable without default or penalty, and (b) provide for the cancellation of the 2008 Notes, without consideration, upon the consummation of a merger between ACG Holdings and an unaffiliated third party. On March 3, 2008, the company entered into an Agreement to Consent with holders of approximately 72.2% in aggregate principal amount of the 2008 Notes to consent to the 2008 Note Amendments in advance of the Consent Solicitation. The Company is also seeking consents from holders of the 2010 Notes to amend the Indenture therefor to provide that the rights and remedies of the trustee thereunder and the holders of the 2010 Notes in the Collateral shall be subordinate and subject to the rights and remedies of the holders of the 2008 Notes with respect to the Junior Liens. For additional information about the March 3, 2008, amendments and waivers to the company's existing first lien bank credit facilities, the March 2008 Facility, the First Supplemental Indenture, and the Consent Solicitation, including the principal definitive documentation therefor, see the company's Current Report on Form 8-K to be filed with the Securities and Exchange Commission. About American Color American Color Graphics, Inc. -- http://www.americancolor.com/-- is one of North America's largest and most experienced full service premedia and print companies, with eight print locations across the continent, six regional premedia centers, photography studios nationwide and a growing roster of customer managed service sites. The company provides solutions and services such as asset management, photography, and digital workflow solutions that improve the effectiveness of advertising and drive revenues for their customers. * * * As reported in the Troubled Company Reporter on Feb. 22, 2008, Standard & Poor's Ratings Services maintained its issuer rating of SD (selective default) on the company. AMERICAN GOLF CARS: Case Summary & 8 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: American Golf Cars, LLC 1200 South Washington Plainville, KS 67663 Bankruptcy Case No.: 08-40238 Type of Business: The Debtor sells golf cars. Chapter 11 Petition Date: March 6, 2008 Court: District of Kansas (Topeka) Debtor's Counsel: David R. Klaassen, Esq. (drklaassen@ks-usa.net) 2649 6th Avenue Marquette, KS 67464 Tel: (785) 546-2358 Estimated Assets: $100,001 to $500,000 Estimated Debts: $1 million to $10 million Debtor's Eight Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ NC-WC, LP Assignee of prior $420,651 4100 Greenbriar Drive, lender Suite 180 Stafford, TX 77477-3963 Trustees of Mary Lou Gilliland Other party to a $245,000 Rev Trust real estate sales Attention: J. Randall contract Clinkscales P.O. Box 722 Hays, KS 67601 Midwest Community Bank Bank loans $152,381 P.O. Box 369 Plainville, KS 67663 Kansas Department of Revenue Unpaid taxes and $85,000 withholdings Internal Revenue Service Unpaid taxes and $67,751 withholdings Mary Ann Nelson Secured personal $51,188 loan Rooks County Treasurer Unpaid real and $24,393 personal property taxes David R. Klaassen Attorney fees and $2,935 expenses AMERICAN HOME: Wants Exclusive Periods Stretched to June 2, 2008 ---------------------------------------------------------------- Pursuant to Section 1121(d) of the Bankruptcy Code, Rule 9006 the Federal Rules of Bankruptcy Procedure, and Rule 9006-2 of the Local Rules of Bankruptcy Practice and Procedure of the U.S. Bankruptcy Court for the District of Delaware, American Home Mortgage Investment Corp. and its debtor-affiliates ask the Court to extend their exclusive periods to: (a) file a plan of reorganization through June 2, 2008; and (b) solicit and obtain acceptances for that plan through July 31, 2008. James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, says that several things must be done in the bankruptcy cases before any party will be in a position to file a Plan and accompanying disclosure statement. He adds that the Debtors, in consultation with the Official Committee of Unsecured Creditors, have determined to seek the 90- day extension. Mr. Patton relates that the Debtors have begun, but not yet completed, negotiations with the Creditors Committee regarding the terms of a consensual Plan or Plans based on adequate information. He, however, points out that the have accomplished several things since December 2007: (a) The Debtors have spent time working with AH Mortgage Acquisition Co., Inc., to facilitate the effective transition of the Servicing Business; (b) The Debtors have focused on maximizing the value of, and minimizing the administrative burdens related to, the their other major assets, like, among other things, marketing and selling loans and analyzing an efficient and the appropriate disposition of the 1,500,000 mortgage loan files they held through a third party vendor; (c) The Debtors have focused their time and resources towards maximizing the value of the bankruptcy estates through the disposition of their major assets, including: -- creation of non-debtor business entities for the transition of the Servicing Business to AHM Acquisition; -- consummation of a sale with Indymac Bank F.S.B.; -- approval of procedures to return mortgage loan files to owners or master servicers of the mortgage loans; -- compromise of certain loans to obtain a greater value for the estates; and -- approval of procedures to maximize the sale value for certain non-performing loans; and (d) The Debtors have expended substantial time and resources addressing the numerous pending adversary proceedings and related discovery matters. Mr. Patton says that, despite the Debtors' accomplishments, the the current Exclusive Periods did not provide them with an adequate opportunity to develop and negotiate a Plan. The contested nature of nearly every facet of the cases has prevented the Debtors and their professionals from devoting significant attention to the preparation and negotiation of a Plan, he says. In addition, the Debtors have had to work with or litigate with numerous large financial entities and other parties-in-interest to obtain approval of the sale of the mortgage loan servicing business. Moreover, the Debtors received various notices of purported defaults from parties to master servicing agreements. Mr. Patton tells the Court that there are a variety of other tasks that lie ahead of the Debtors. The Debtors still have numerous other assets that may be marketed and sold, including their (i) federally chartered thrift and bank, which will need to be sold in a manner consistent with strict regulatory guidelines; (ii) certain whole loans; and (iii) certain other real estate holdings, like their Melville, New York, corporate headquarters. The resolution of asset sales and the review and analysis of claims will be determinative of the value available to the Debtors' creditors, and must be considered in the formulation of any Chapter 11 plan, Mr. Patton says. Judge Christopher Sontchi will convene a hearing on March 11, 2008, at 11:00 a.m., to consider the Debtors' request. Pursuant to Local Rule 9006-2, the Debtors' Exclusive Periods is automatically extended until the conclusion of that hearing. About American Home Mortgage Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP, represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expired on March 3, 2008. (American Home Bankruptcy News, Issue No. 29, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstandor 215/945-7000) AMERICAN HOME: Wants to Employ PwC as Tax Advisors -------------------------------------------------- Pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code, American Home Mortgage Investment Corp. and its debtor-affiliates seek the Court's permission to employ PricewaterhouseCoopers LLP as tax advisors, nunc pro tunc to February 12, 2008. The Debtors relate that they have already retained PwC as an ordinary course professional to assert and perfect claims for Social Security and state and federal unemployment tax-related credits properly owing to them. The Debtors say that they need PwC's services to assist in the administration of their bankruptcy estates. The Debtors believe that with PwC's extensive experience and knowledge, the firm is well suited and qualified to serve as the Debtors' tax advisors in a cost-effective and efficient manner. As tax advisors, PwC will, among other things: -- review calculation of taxable income for American Home Mortgage Investment Corp., for 2007 and 2008; -- research and provide consultation with respect to tax return filing issues; -- prepare Federal and State Partnership income tax returns for Bayliss Trust; -- research and provide consultation with respect to federal and state income tax issues regarding multi-series joint ventures; -- research and prepare calculations with respect to premium amortization, discount accretion, original issue discount, excess inclusion income and securitization taxable income; -- research and prepare calculations of foreign trust tax returns; and -- prepare or review Forms 1120 REIT or 1120. Pursuant to the parties' Engagement Letter, the Debtors will pay PwC according to the firm's standard hourly rates: Partner $700 Managing Director $585 Director $485 Manager $380 Senior Associate $285 Associate $205 The Debtors will also reimburse PwC for all reasonable costs and expenses it incurred in connection with the services it performed for the Debtors. Thomas Geppel, a partner at PwC, assures the Court that PwC does not represent any interest adverse to the Debtors and their estates, and is a "disinterested person" as the term is defined in Section 101(14). About American Home Mortgage Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP, represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The Debtors' exclusive period to file a plan expired on March 3, 2008. (American Home Bankruptcy News, Issue No. 29, Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstandor 215/945-7000) AMF BOWLING: Moody's Holds B2 Rating; Changes Outlook to Negative ----------------------------------------------------------------- Moody's Investors Service affirmed AMF Bowling Worldwide, Inc.'s B2 corporate family rating, but revised its ratings outlook to negative from stable. The outlook revision reflects Moody's concern that weak consumer spending could negatively affect AMF's operating performance over the medium-term given the discretionary nature of its business. AMF has already experienced a moderate decline in operating performance for the six-months ended Dec. 30, 2007 over the same period last year, reflecting soft demand trends at traditional bowling centers and some cost pressures. These issues heighten Moody's concern over the company's high leverage. Notwithstanding these risks, Moody's recognizes the potential for AMF to stabilize its operating performance in the second half of fiscal 2008 through its profit improvement efforts and its adequate liquidity position. These ratings were affirmed: -- Corporate Family Rating at B2; -- Probability of Default Rating at B2; -- $40 million first lien revolver due 2012 at B1 (LGD3, 32%). Point estimate revised from (LGD3, 33%); -- $245 million first lien term loan due 2013 at B1 (LGD3, 32%). Point estimate revised from (LGD3, 33%); -- $80 million second lien term loan due 2013 at Caa1 (LGD5, 81%). Point estimate revised from (LGD5, 82%). Headquartered in Richmond, Virginia, AMF Bowling Worldwide, Inc. is the largest operator of bowling centers in the world with approximately 350 centers in operation, including eight centers outside the US. AMF had revenues of $485 million for the twelve months ended Dec. 30, 2007. ANN-LEE CONSTRUCTION: Case Conversion Trial Continues on April 8 ---------------------------------------------------------------- The Honorable Jeffery A. Deller of the United States Bankruptcy Court for the Western District of Pennsylvania will continue the hearing of the conversion of Ann-Lee Construction and Supply Company, Inc.'s chapter 11 case into a chapter 7 liquidation proceeding at 10:00 a.m., on April 8, 2008, at the Courtroom D, 54th Floor, US Steel Tower in Pittsburgh, Pennsylvania. As reported in the Troubled Company Reporter on Dec. 27, 2007, the Court deferred the hearing to consider approval of Ann-Lee Construction's request to convert its case to Feb. 5, 2008. In its request, the Debtor told the Court that it has incurred additional losses from Jan. 11, 2007, to Aug. 17, 2007, and as a result, it was unable to meet its debts as they come due. The Debtor further said that it was unable to file a viable Chapter 11 plan and disclosure statement within the required time set by the Court. The Debtor's exclusive plan filing period expired on Sept. 19, 2007. About Ann-Lee Construction Based in Saltsburg, Pennsylvania, Ann-Lee Construction and Supply Company, Inc. offers construction consulting & management services. The company filed for Chapter 11 protection on Jan. 11, 2007 (Bankr. W.D. Pa. Case No. 07-20226). Michael J. Henny, Esq. and Joseph V. Luvara, Esq. represent the Debtor in its restructuring efforts. Kirk B. Burkley, Esq., at Bernstein Law Firm PC, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed estimated assets and debts of $1 million to $100 million. AQUILA INC: Permit to Build South Harper Facilities Canceled ------------------------------------------------------------ Aquila Inc. disclosed in a regulatory filing Wednesday that the Missouri Court of Appeals for the Western District of Missouri has issued an order relating to the company's South Harper power generation "peaking" facility and related substation. The appellate court held that the Missouri Public Service Commission lacked the statutory authority to approve the construction of the South Harper facilities after the facilities had been constructed. Accordingly, the opinion sets aside the approval the company received in 2006 from the Missouri Public Service Commission, which had specifically authorized the company to construct the South Harper facilities. The company said it is currently evaluating its options, which may include requesting a rehearing or asking the appellate court to transfer the case to the Missouri Supreme Court. Cass County and local residents had filed suit claiming that county zoning approval was required to construct the project. In January 2005, a Circuit Court of Cass County judge granted the County's request for an injunction; however, the company was permitted to continue construction while the order was appealed. The company appealed the Circuit Court decision to the Missouri Court of Appeals for the Western District of Missouri and, in June 2005, the appellate court affirmed the circuit court ruling. In July 2005, the company requested that the Court of Appeals either rehear the case or transfer the case to the Missouri Supreme Court and, in October 2005, the Court of Appeals granted the company's request for rehearing. In December 2005, the appellate court issued a new opinion affirming the Circuit Court's opinion, but also opining that it was not too late to obtain the necessary approval. In light of this, the company filed an application for approval with the Missouri Commission on Jan. 24, 2006. On Jan. 27, 2006, the trial court granted the company's request to stay the permanent injunction until May 31, 2006, and ordered it to post a $20.0 million bond to secure the cost of removing the project. Effective May 31, 2006, the Missouri Commission issued an order specifically authorizing the construction and operation of the power plant and substation. On June 2, 2006, the trial court dissolved the $20.0 million bond, further stayed its injunction, and authorized the company to operate the plant and substation while Cass County appealed the Missouri Commission's order. In June 2006, Cass County filed an appeal with the Circuit Court, challenging the lawfulness and reasonableness of the Missouri Commission's order. On Oct. 20, 2006, the Circuit Court ruled that the Missouri Commission's order was unlawful and unreasonable. The Missouri Commission and Aquila appealed the court's decision with the Missouri Court of Appeals for the Western District of Missouri. A full-text copy of the order of the Missouri Court of Appeals for the Western District of Missouri dated March 4, 2008, is available for free at http://researcharchives.com/t/s?28da About Aquila Inc. Headquartered in Kansas City, Missouri, Aquila Inc. (NYSE: ILA) -- http://www.aquila.com/-- owns electric power generation and operates electric and natural gas transmission and distribution networks serving over 900,000 customers in Colorado, Iowa, Kansas, Missouri and Nebraska. * * * Aquila Inc. carries Moody's Investors Service's Ba2 corporate family, Ba3 Senior Unsecured Debt, and Ba3 probability-of-default ratings. ARROW ELECTRONICS: To Buy Achieva's Components Distribution Biz --------------------------------------------------------------- Arrow Electronics Inc. signed a definitive agreement pursuant to which Arrow will purchase the components distribution business from parent company Achieva Ltd., a value-added distributor in Asia Pacific. Arrow anticipates the transaction will be immediately accretive to earnings in the first twelve months by $0.01 to $0.03 per share and will meet the company's acquisition objectives for return on invested capital. The transaction is subject to approval by the shareholders of Achieva Ltd. and is expected to close in the next 60 to 90 days. "Achieva will further strengthen our position in the ASEAN (Association of Southeast Asian Nations) and greater China markets and enhance our existing demand creation capabilities," said William E. Mitchell, chairman, president and chief executive officer of Arrow Electronics, Inc. "With this acquisition, Arrow will gain strong, established relationships with major semiconductor suppliers that will expand our line card as well as build upon existing partnerships. The Achieva management team is highly experienced and will be an impressive addition of bench strength to position Arrow for continued profitable growth in the Asia Pacific region," added Mr. Mitchell. Achieva is focused on creating value for its partners through technical support and demand creation activities. The company's product range covers semiconductor components such as application specific integrated circuits, programmable logic devices, digital signal processing chips and microchip-controller units. With over 200 employees, the company has a presence in eight countries (Singapore, Taiwan, China, India, Malaysia, Philippines, Thailand, and Korea) and primarily serves small and medium sized customers in the data communications, telecommunications, lighting, industrial and digital consumer end markets. Total 2006 sales were approximately $200 million. About Arrow Electronics Headquartered in Melville, New York, Arrow Electronics Inc. -- http://www.arrow.com/-- provides products, services and solutions to industrial and commercial users of electronic components and computer products. Arrow serves as a supply channel partner for nearly 600 suppliers and more than 130,000 original equipment manufacturers, contract manufacturers and commercial customers through a global network of over 270 locations in 53 countries and territories. The company operates in France, Spain, Portugal, Denmark, Estonia, Finland, Ireland, Latvia, Lithuania, Norway, Sweden, Italy, Germany, Austria, Switzerland, Belgium, the Netherlands, United Kingdom, Argentina, Brazil, Mexico, Australia, China, Hong Kong, Korea, Philippines and Singapore. * * * Arrow Electronics senior subordinated stock continues to carry Moody's Investors Service's Ba1 rating. The company's senior preferred stock is rated at Ba2. ATHERTON FRANCHISE: Fitch Holds 'B' Rating on 1998-A Cl. D Trusts ----------------------------------------------------------------- Fitch Ratings has taken these rating actions on the Atherton Franchise Loan Funding Trusts listed below: Atherton Franchise Loan Funding 1997-A -- Class A-1 currently rated at 'AAA', remains on Rating Watch Negative; -- Class A-2 currently rated at 'AAA', remains on Rating Watch Negative; -- Class B remains at 'CCC/DR1'; -- Class C remains at 'C/DR6'. Class A-1 and A-2 ratings are based on a financial guaranty insurance policy from MBIA Insurance Corp. Atherton Franchise Loan Funding 1998-A -- Class A-X affirmed at 'AAA'; -- Class B affirmed at 'AA'; -- Class C affirmed at 'BB'; -- Class D affirmed at 'B/DR1'; -- Class E remains at 'CCC'/DR3'; -- Class F remains at 'C/DR6'. Atherton Franchise Loan Funding 1999-A -- Class A-2 affirmed at 'A'; -- Class A-X affirmed at 'A'; -- Class B affirmed at 'BBB'; -- Class C remains at 'CCC/DR1'; -- Class D remains at 'C/DR3'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'. Fitch's analysis incorporated anticipated losses on defaulted collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral- specific recoveries experienced in the franchise loan asset-backed securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to asses the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis of anticipated losses, credit support was found to be consistent with Fitch's previous review leading to the affirmation of the current ratings. AUSTINBURG PROPERTIES: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Lead Debtor: Austinburg Properties, LLC 3864 Center Road Suite A-18 Brunswick, OH 44212 Bankruptcy Case No.: 08-50651 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- 138 Mazal Health Care, Ltd. 08-50655 Dani Family Ltd. 08-50657 Willow Interests, LLC 08-50653 Type of Business: The Debtor is a real estate corporation. Chapter 11 Petition Date: February 29, 2008 Court: Northern District of Ohio (Akron) Judge: Marilyn Shea-Stonum Debtor's Counsel: Theodore T. Mairanz, Esq. Neiman & Mairanz P.C. 39 Broadway 25th Floor New York, NY 10006 Tel: (212) 269-1000 tmairanz@ngmpc.com Austinburg Properties LLC's financial condition: Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million The Debtors did not file a list of their 20 Largest Unsecured Creditors. BALDO CISNEROS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Baldo V. Cisneros 11406 Covent Gardens Drive Bakersfield, CA 93311 Bankruptcy Case No.: 08-11200 Chapter 11 Petition Date: March 6, 2008 Court: Eastern District of California (Fresno) Judge: Whitney Rimel Debtor's Counsel: D. Max Gardner, Esq. 1800 30th Street 4th Floor Bakersfield, CA 93301-5298 Tel: (661) 327-9661 Estimated Assets: $500,001 to $1 million Estimated Debts: $1,000,001 to $10 million Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ AILLC value of $200,000 8965 South Eastern Avenue security: Suite 360 $400,000 Las Vegas, NV 89123 State of California sales and use $190,127 4820 McGrath Street taxes Suite 260 Ventura, CA 93003-7778 Internal Revenue Service federal $183,472 P.O. Box 21126 withholding tax Philadelphia, PA 19114-0326 Sysco Food Service goods & services $103,143 Alameda Food Service Company goods & services $102,732 Quicksand LLC leasehold $94,361 interests City of Tehachapi utility bills $94,000 AMK Foodservice Company goods & services $84,724 Bakersfield Mall LLC Valley leasehold $76,942 interests Capital One credit card $70,554 purchases Don Kinzel Construction goods & services $50,000 U.S. Food Service goods & services $41,089 Sysco Las Vegas goods & services $35,855 Nevada State Dept. Taxation sales and use $35,752 taxes PG & E utility bills $23,388 Chase Credit Card credit card $20,000 purchases Nevada Power utility bills $14,522 Siemens Building Technologies goods & services $13,059 Bank of America credit card $10,200 purchases Nevada Dept. of Employment withholding tax $7,000 BARNET HOSPITAL: Sells All Assets to Community Healthcare --------------------------------------------------------- The Hon. Donald H. Steckroth of the United States Bankruptcy Court for the District of New Jersey authorized Nathan and Miriam Barnert Memorial Hospital Association dba Barnert Hospital, to sell substantially all of its assets Community Healthcare Associates LLC. Community Healthcare was named as successful bidder after topping Hospital Associates LLC, the stalking horse bidder. The Debtor will pay $350,000 as break-up fee to Hospital Associates. Under the asset purchase agreement, the purchased assets are comprised of: -- assumption by Community Healthcare of the assumed liabilities; -- purchase note $6,000,000 as initial principal payment plus the amount of the financed receivables secured by the guaranty and the new mortgage; -- unencumbered asset payment; and -- aggregate of Community Healthcare's share of the transfer taxes, if any, and other payment obligations. The Debtor expects the sale to close no later than May 30, 2008. A full-text copy of the Asset Purchase Agreement date Feb. 15, 2008, is available for free at: http://ResearchArchives.com/t/s?28dd Nathan and Miriam Barnert Memorial Hospital Association, dba Barnert Hospital, -- http://www.barnerthospital.com/-- owns and operates a 256 bed general acute care community hospital located at 680 Broadway in Paterson, New Jersey. The company filed for chapter 11 protection on Aug. 15, 2007 (Bankr. D. N.J. Case No. 07-21631). David J. Adler, Esq., at McCarter & English, LLP, represents the Debtor in its restructuring efforts. Warren J. Martin Jr., Esq. and John S. Mairo, Esq., at Porzio Bromberg & Newman, P.C., represent the Official Committee of Unsecured Creditors in this case. Donlin Recano & Company Inc. is the Debtor's claims, noticing, and balloting agent. The Debtor's schedules reflect total assets of $46,600,967 and total liabilities of $61,303,505. * * * The Court extended the Debtor's exclusive filing period to file a plan until April 11, 2008. BEAR STEARNS: Whicker & Breighton Continue as Joint Liquidators --------------------------------------------------------------- Recent articles in the Hedge Funds Review have incorrectly stated that Mr. Simon Whicker and Mr. Kris Beighton have been replaced as Joint Official Liquidators of the two Bear Stearns Master Funds that were placed into Official Liquidation on 31 July 2007. To clarify, Messrs. Whicker & Beighton continue in their roles as JOLs of Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd. & Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Master Fund, Ltd. There have been no challenges to the appointment of Messrs. Whicker & Beighton as JOLs of the MASTER Funds. The MASTER Funds are insolvent and therefore the JOLs' primary duty is to maximise realisations for the benefit of the MASTER Funds' creditors. To date no objections to the JOLs' appointment have been received from any of the MASTER Funds' creditors. The creditors themselves are represented in the liquidations by Liquidation Committees that are composed of the significant majority of known creditors on the High-Grade and Enhanced Leverage Master Funds respectively. External investors gained access to the MASTER Funds by investing into FEEDER Funds registered in either the US or the Cayman Islands. On Nov. 2007 Messrs Whicker & Beighton were appointed as Joint Voluntary Liquidators for certain of the Cayman Islands registered FEEDER Funds. The FEEDER Funds are completely separate legal entities to the MASTER Funds. Subsequent to a poll of the external investors, the results of which favoured the replacement of Messrs. Whicker & Beighton, the JVLs have been replaced by Mr. Geoffrey Varga & Mr. Bill Cleghorn of Kinetic Partners Cayman LLP. Kinetic has no role in the Official Liquidation of the MASTER Funds. Mr. John Milsom & Mr. Richard Heis, of KPMG UK LLP were appointed as Joint Liquidators of the US registered FEEDER Funds on Nov. 1, 2007 (High-Grade US Feeder) and Nov. 16, 2007 (Enhanced Leverage US Feeder). No challenges to their appointment have been received. About Bear Stearns Funds Grand Cayman, Cayman Islands-based Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Master Fund Ltd. and Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd. are open-ended investment companies, which sought high income and capital appreciation relative to the London Interbank Offered Rate, and designed for long-term investors. On July 30, 2007, the Funds filed winding up petitions under the Companies Law (2007 Revision) of the Cayman Islands. Simon Lovell Clayton Whicker and Kristen Beighton at KPMG were appointed joint provisional liquidators. The joint liquidators filed for Chapter 15 petitions before the U.S. Bankruptcy Court for the Southern District of New York the next day. On August 30, 2007, the Honorable Burton R. Lifland denied the Funds protection under Chapter 15 of the Bankruptcy Code. Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F. Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the liquidators in the United States. The Funds' assets and debts are estimated to be more than $100,000,000 each. (Bear Stearns Funds Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). BECKMAN COULTER: Fitch Holds 'BB-' Rating on $109.7MM Cl. A Loans ----------------------------------------------------------------- Fitch Ratings affirmed Beckman Coulter, Inc.'s $109.7 million class A loans under series BC 2000-A at 'BB-'. The loans are secured by two of Beckman Coulter's office/research and development facilities, located in Brea, California and Miami, FLorida. The buildings are 100% occupied by Beckman Coulter, a company rated 'BBB' by Fitch. Class A is experiencing interest shortfalls due to special servicing fees, having been placed in special servicing because of legal actions arising out of disputes over the tenant's failure to pay sales taxes on rent. Beckman Coulter, the tenant has requested a hearing with the Florida Department of Revenue to dispute the legitimacy of the sales tax charges and the borrower has initiated a legal action against Beckman Coulter for its failure to pay the sales taxes. Beckman Coulter has escrowed funds to pay the obligations to the State should they not be successful in winning the suit. While the suits do not involve the trust, the bond's rating takes into account the likelihood that special servicing fees will continued to be deducted from the interest payments investors receive. The monthly fee is 0.05% of the outstanding loan amount on the Miami loan. Until October 2008, each property is subject to a NNN lease in which the tenant is obligated to make payments equal to the interest on the borrower's loans. After that period, the payments are fixed at a rate reflecting an amount equal to the loan's principal and interest payments, until the loan's maturity date of June 30, 2018. As part of its analysis, Fitch took into consideration the average rent expected over the remaining term and applied market vacancies, management fees and capital expenditure assumptions in order to derive a normalized operating cash flow for the properties. The resulting stressed debt service coverage ratio, based upon Fitch's cash flow and a debt constant of 9.66% is 1.26 times. BLACKHAWK AUTOMOTIVE: Court Approves Asset Sale to Flex-N-Gate -------------------------------------------------------------- Judge Kay Woods of the United States Bankruptcy Court for the Northern District of Ohio in Youngstown approved the sale of assets of Blackhawk Automotive Plastics Inc. and Tier e Automotive Group Inc. to Flex-N-Gate LLC, the Youngstown Vindicator reports. The Court approved the $16.4 million offer. The sale is to close March 14, Vindicator says. Lawyers said that Flex-N-Gate intends to keep the 700-employee Salem plant open, Vindicator adds. Active Burgess Mould & Design and Automotive Gage & Fixture objected to the sale and the Debtors' proposal to assume and assign certain executory contracts and unexpired leases. Active Burgess and Automotive Gage, secured creditors of the Debtors, argued that both the amended and restated asset purchase agreement and sale request failed to identify that the molds are customer owned or unpaid tooling. Thus, they could not determine whether a purchaser is acquiring rights in the molds. On behalf of the objecting parties, Michael R. Wernette, Esq., at Schafer and Weiner, PLLC in Bloomfield Hills, Michigan, related that the Debtors purchased molds from Active Burgess and failed to pay for them in full. Mr. Werenette said that Active Burgess and Automotive Gage asked the Debtor to clarify this issue but received no response from the Debtor. Flex-N-Gate, LLC in Urbana, Illinois, produced the only acceptable bid for the Debtors in a bankruptcy auction held on March 3, 2007. Magna International in Canada attended the auction on Monday but decline to make a bid, according to Don Shilling of vindy.com. A full-text copy of the Amended and Restated Asset Purchase Agreement is available for free at: http://ResearchArchives.com/t/s?28d8 A full-text copy of the asset sale request is available for free at: http://ResearchArchives.com/t/s?28d9 Salem, Ohio-based Blackhawk Automotive Plastics Inc., formerly Warren Molded/Custom Plastics, manufactures injection molded plastic products and motor vehicle parts and accessories. BAP's customers include General Motors, Delphi, Lear, Chrysler, Honda, Navistar, and Visteon. BAP employs about 1,574 workers domestically, and generated $136 million in sales in 2006. BAP owns Canadian subsidiary, Blackhawk Automotive Plastics Ltd. which operated a manufacturing facility in Ontario until Johnson Controls Inc. bought BAP Canada's assets in May 2005. BAP Canada's remaining assets consist primarily of net operating loss carryforwards for Canadian tax purposes. The NOLs had a book value of about $8.2 million as of December 2005. BAP also owns a plant in Upper Sandusky, Ohio, which ceased operations in 2006. The company filed for chapter 11 protection on Oct. 22, 2007 (Bankr. N.D. Ohio, Case No. 07-42671). Its parent company, Tier e Automotive Group Inc., filed a separate chapter 11 petition on the same day (Bankr. N.D. Ohio, Case No. 07-42673). Tier e acquired BAP from Worthington Industries Inc. in 1999. Tier e also owns 49% stake in Nescor Holdings Inc., a holding company for Nescor Plastics Corporation, also an automotive plastics supplier. William I. Kohn, Esq., David M. Neumann, Esq., Stuart A. Laven, Jr., Esq., at Benesch, Friedlander, Coplan & Aronoff LLP, represent the Debtors in their restructuring efforts. Donlin Recano & Company Inc. provides the Debtors with claims, noticing, balloting and distribution services. The Debtors' schedules disclosed total assets of $58,665,229 and total liabilities of $51,244,592. As of bankruptcy filing, BAP's aggregate debt to its senior facility lenders was about $33 million. * * * As reported in the Troubled Company Reporter on Feb. 21, 2008, the Debtors asked the Court to further extend their exclusive period to file a Chapter 11 plan until May 19, 2008. BUILDING MATERIALS: Declining Sales Cue Moody's Ratings Cuts to B2 ------------------------------------------------------------------ Moody's Investors Service lowered the ratings of Building Materials Holding Corporation, including its corporate family rating to B2 from B1, its probability-of-default rating to B3 from B2, and its first-lien bank credit facility rating to B2 (LGD3, 39%) from B1 (LGD3, 38%). This concludes the review that was commenced on Feb. 13, 2008. The ratings outlook is negative. The downgrade is prompted by BMHC's declining sales, deteriorating credit metrics, and the company's need to seek covenant relief under its bank credit facility after receiving a temporary waiver of compliance from its banks for the 4th quarter of 2007. On Feb. 29, 2008, the company successfully amended its bank credit facility, which now provides a larger degree of headroom under a set of relaxed financial covenants. However, the size of the revolving credit facility was reduced to $200 million from $500 million, and is subject to a restrictive borrowing base. Moody's expectation that weak homebuilding market conditions will continue throughout 2008 and potentially into 2009, could exert further pressure on the company's operating performance and credit profile, with credit availability remaining tight throughout this period. BMHC's scale, its leading industry position, and its longer term prospects as one of the nation's largest providers of residential construction services and building materials continue to support its B2 rating. The negative ratings outlook reflects continued weakness in new home construction, large inventories of unsold homes, declining home prices and weak consumer confidence. Tightened mortgage lending practices also weigh heavily on intermediate term prospects for a recovery in housing demand. The company's ability to cut costs, reduce capital expenditures, manage working capital needs, and maintain adequate liquidity until homebuilding industry fundamentals stabilize partially mitigate downward pressure. Headquartered in San Francisco, California, BMHC, a Fortune 1000 company, is one of the largest providers of residential construction services and building materials in the United States. BMHC serves the homebuilding industry through two subsidiaries: SelectBuild provides construction services to high-volume production homebuilders in key growth markets across the country; and BMC West distributes building materials and manufactures building components for professional builders and contractors in the western and southern states. CAPRI CONDOMINIUMS: Wants to Hire Kingery & Crouse as Accountant ---------------------------------------------------------------- The Capri Condominiums Limited Partnership asks authority from the U.S. Bankruptcy Court for the Middle District of Florida to employ Charles Crouse at Kingery & Crouse, P.A. as its accountant under general retainer. Kingery & Crouse will: a) give advice to the Debtor regarding budgetary and other financial issues and challenges involving the Development; b) assist the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the Court, including the preparation and review of monthly operating reports and underlying financial data; and c) work with management of the Debtor, as well as counsel, in the preparation of a plan of reorganization and in assessing and establishing feasibility and advisability. The firm will bill the Debtor at these rates: Designation Hourly Rates ----------- ------------ Managers $150 - $220 General Staff $85 - $125 Charles Crouse and Mark Kingery will charge the Debtor at $240 per hour. Prior to bankruptcy filing, the firm has accrued a $3,350 claim for services from the Debtor. It is anticipated that this account receivable will be waived by the firm as a condition precedent to appointment. To the best of the Debtor's knowledge, the firm holds no interest adverse to the Debtor and its estates and is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Tampa, Florida-based The Capri Condominiums LP owns and manages condominiums. Capri is operated by Euro American Investors Group in The Netherlands, which runs an office in Tampa, Florida. Euro American Investors -- http://www.eaig.nl/-- is an international company that offers a complete package property with the focus on the United States and Europe. Since its launch in 1979, Euro American Investors built a diversified portfolio of properties, apartments, offices, commercial buildings, and shopping malls. Capri Condominiums sought protection under chapter 11 on Feb. 6, 2008 (Bankr. M.D. Fla. Case No. 08-01553). Maureen A. Vitucci, Esq., at Gray Robinson PA represents the Debtor in its restructuring efforts. When the Debtor filed for bankruptcy, it listed assets and debts between $10 million and $50 million. CARAUSTAR INDUSTRIES: S&P Chips Ratings to 'B-' on Weak Earnings ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Caraustar Industries Inc., including its corporate credit rating, to 'B-' from 'B+'. The outlook is negative. "The downgrade reflects continuing weak earnings and cash flow, lower-than-expected liquidity, and refinancing risk," said Standard & Poor's credit analyst Pamela Rice. "Fourth-quarter 2007 earnings were substantially weaker than expected. In addition, margin pressure from raw material and energy costs persists, and the realization of recently announced price increases is uncertain. We are also concerned about the company's ability to address the June 1, 2009, maturity of its $190 million senior unsecured notes given the challenging credit markets." Caraustar had about $315 million of total debt, including debt- like obligations, at Dec. 31, 2007. Austell, Georgia-based Caraustar is one of the largest U.S. manufacturers of 100% recycled paperboard. "We could lower the ratings if Caraustar's profitability worsens in the next few quarters, if market conditions deteriorate, or if liquidity narrows," Ms. Rice said. "We could also lower the ratings if the company is unable to address its June 2009 debt maturity in a manner that does not harm credit quality. We could revise the outlook to stable if the company is able to realize sufficient benefits from its rationalization and cost-reduction efforts and price increases to meaningfully improve earnings over the next few quarters and successfully refinances or repays its maturing debt." CARLYLE CAPITAL: Misses Margin Calls and Gets Notice of Default --------------------------------------------------------------- Carlyle Capital Corporation Limited said that since filing its annual report on Feb. 28, 2008, the company has been subject to margin calls and additional collateral requirements totaling more than $60 million. It said that until March 5, the company had met all of the margin requirements imposed by its repo counterparties. However, on March 5, the company received additional margin calls from seven of its 13 repo counterparties totaling more than $37 million. The company has met margin calls from three of these financing counterparties that have indicated a willingness to work with the company during these tumultuous times, but did not meet the margin requirements of the four other repo financing counterparties. >From this group of four counterparties, one notice of default has been received by the company and management expects to receive at least one additional default notice. John Stomber, Chief Executive Officer, President and Chief Investment Officer of the company, said, "The last few days have created a market environment where the repo counterparties' margin prices for our AAA-rated U.S. government agency floating rate capped securities issued by Fannie Mae and Freddie Mac are not representative of the underlying recoverable value of these securities. Unfortunately, this disconnect has created instability and variability in our repo financing arrangements. Management is actively working with the company's repo counterparties to develop more stable financing terms." Since the liquidity crisis in global fixed income markets started in August, the company has sold almost $1 billion in non-RMBS assets to improve liquidity and reduce leverage. The company has also received significant support from The Carlyle Group, most notably in the form of a $150 million subordinated revolving credit line. Fourth Quarter 2007 Highlights and Update The company had net income for the fourth quarter of 2007 was $17.6 million, compared to a net loss of $34.2 million in the third quarter of 2007. Fully diluted net income per Class B share was $0.34 in the fourth quarter, compared to a loss per Class B share of $0.74 in the third quarter of 2007. Net income for the year ended Dec. 31, 2007, was $16.8 million, or $0.45 per Class B share on a fully diluted basis. As of Feb. 27, 2008, the company's $21.7 billion investment portfolio is comprised exclusively of AAA-rated floating rate capped residential mortgage backed securities issued by Fannie Mae and Freddie Mac, which are considered to have the implied guarantee of the U.S. government and are expected to pay at par at maturity. The Carlyle Group agreed to increase the $100 million unsecured revolving credit facility made available to the company to $150 million and extend the maturity to July 1, 2009. As of Feb. 27, 2008, the company had $80 million of availability under this credit facility. As of Feb. 27, 2008, the company had unused repo lines of $2.4 billion with 11 counterparties. As of Dec. 31, 2007, the company's "Liquidity Cushion" was $67.2 million and was comprised of cash and cash equivalents, unencumbered AAA-rated mortgage backed securities and available committed borrowings from The Carlyle Group. As of Feb. 27, 2008, the company's Liquidity Cushion had increased to $130 million. The Liquidity Cushion consists of an existing $80 million Liquidity Cushion plus the additional $50 million increase to the existing unsecured revolver provided by Carlyle. The Carlyle Group with the support of the Board of Directors of the company waived the incentive fee earned for the fourth quarter of 2007. The Carlyle Group also amended its Investment Management Agreement so that the incentive fee will only be earned with respect to a calendar quarter for which the Board declares a dividend on the company's Class B shares. The Board of Directors decided to retain the company's fourth quarter earnings and not pay a dividend to achieve its short term objective of preserving the long term value of its shareholders' equity. During the fourth quarter of 2007, an affiliate of Carlyle Investment Management LLC, the company's investment manager, purchased Class B shares of the company in the open market increasing its ownership to approximately 15% of the issued and outstanding Class B shares from approximately 12% at the time of the global offering. "During the fourth quarter our portfolio stabilized and we were able to generate returns consistent with our near term targets," said John Stomber, Chief Executive Officer, President and Chief Investment Officer of the Company. "We are focused on building our liquidity cushion and broadening our available repo lines. We continue to run our business to preserve the value of our shareholders' equity and to position the Company to meet our long run objectives of earning an attractive risk adjusted return and paying a consistent dividend in the future." A full-text copy of the company's annual report can be obtained at http://ResearchArchives.com/t/s?28d7 About Carlyle Capital Carlyle Capital Corporation Limited (Euronext Amsterdam ticker symbol: CCC; ISIN: GG00B1VYV826) -- http://www.carlylecapitalcorp.com/-- is a Guernsey investment company that was formed on Aug. 29, 2006. It is a closed-end investment fund domiciled and registered as a limited company under the laws of Guernsey, Channel Islands. The company invests in a diversified portfolio of fixed income assets including high- grade mortgages and credit products. The company's day-to-day activities and investment portfolio are managed by Carlyle Investment Management LLC, whose investment professionals have extensive experience in the areas of mortgage finance, leveraged finance, capital markets transaction structuring and risk/portfolio management. CIM manages the company pursuant to a management agreement. CIM is a registered investment adviser under the U.S. Investment Advisers Act of 1940 and is an affiliate of The Carlyle Group. CARLYLE CAPITAL: Continuing Talks with Lenders on Financial Woes ---------------------------------------------------------------- Carlyle Capital Corporation Limited said Friday that it is in continuing discussions with its lenders regarding its financing situation. The Wall Street Journal reports that lenders are to meet at 10:30 a.m. today. The company disclosed that it received on Thursday substantial additional margin calls and additional default notices from its lenders. The company was also notified that some of its residential mortgage-backed securities had been liquidated by lenders who had previously issued default notices to the company. It is possible that additional securities may be liquidated by the lenders, the company said. A story on missed margin calls and default notice accompanies today's copy of the Troubled Company Reporter. In the past several days there has been a rapid and severe deterioration in the market for U.S. government agency AAA-rated residential mortgage-backed securities, the company explained. Based on the weakened market, several of the company's lenders marked down the value of the company's RMBS and informed the company that they would soon materially increase their collateral requirements. Although the company believed last week that it had sufficient liquidity, it was informed by its lenders this week that additional margin calls and increased collateral requirements would be significant and well in excess of the margin calls it received Wednesday. The company believes these additional margin calls and increased collateral requirements could quickly deplete its liquidity and impair its capital. Carlyle Capital said its management is closely monitoring the situation and considering all available options for the company. Carlyle Capital's ultimate parent, The Carlyle Group, pulled its support for the investment vehicle and trading of Carlyle Capital's stock has been halted, WSJ relates. Citigroup analyst Donald Fandetti commented that Carlyle Capital will face liquidation or bankruptcy unless Carlyle Group takes another rescue effort, The Associated Press and WSJ say. About Carlyle Capital Carlyle Capital Corporation Limited (Euronext Amsterdam ticker symbol: CCC; ISIN: GG00B1VYV826) -- http://www.carlylecapitalcorp.com/-- is a Guernsey investment company that was formed on Aug. 29, 2006. It is a closed-end investment fund domiciled and registered as a limited company under the laws of Guernsey, Channel Islands. The company invests in a diversified portfolio of fixed income assets including high- grade mortgages and credit products. The company's day-to-day activities and investment portfolio are managed by Carlyle Investment Management LLC, whose investment professionals have extensive experience in the areas of mortgage finance, leveraged finance, capital markets transaction structuring and risk/portfolio management. CIM manages the company pursuant to a management agreement. CIM is a registered investment adviser under the U.S. Investment Advisers Act of 1940 and is an affiliate of The Carlyle Group. CASA DE CAMBIO: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Casa de Cambio Majapara S.A. de C.V. aka Majapara Casa de Cambio Lago Margarita No. 16 Colonia Granada, C.P. 11520 Mexico, D.F. Bankruptcy Case No.: 08-05230 Type of Business: The Debtor is engaged in financial transactions processing, reserve, and clearing house activities. See http://www.majapara.com.mx Chapter 11 Petition Date: March 5, 2008 Court: Northern District of Illinois (Chicago) Debtor's Counsel: Andrew L. Wool, Esq. (andrew.wool@kattenlaw.com) Katten Muchin Rosenman, LLP 525 West Monroe Street Chicago, IL 60661 Tel: (312) 902-5623 http://www.kattenlaw.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wachovia Bank N.A. contract, disputed, $24,197,000 Attention: Carlos Perez quasi-contract, 200 South Biscayne Boulevard, trade 12 Floor Miami, FL 33131 Tel: (305) 789-6920 Blanca Nieves Luisa contract, $2,009,944 Valle Villazon quasi-contract, Navegantes 234 Esq. trade Jacarandas Col. Virginia Boca del Rio C.P. 94294 Veracruz, Mexico Tel: 52-229-935-1909 Adquira Mexico S.A. de C.V. contract, $1,674,436 Attention: Miguel Angel quasi-contract, Escalona trade Paseo de la Reforma No. 1200 Piso 2, Cruz Manca Cuajimalpa C.P. 5349 Mexico, D.F. Tel: 52-55-5-16169714 Zions First National Bank contract, $1,670,690 Attention: Lourdes Vega quasi-contract, 1 South Main Street trade Salt Lake City, UT 84111-1904 Tel: (801) 844-7876 Andamios Cimbras Y Casetone contract, $730,580 S.A. de C.V. quasi-contract, Attention: Marcelo Vazquez trade Stringel Patricio Sanz No.33 Desp. 101 Col. del Valle Mexico, D.F. C.P. 03100 Tel: 52-55-5-669-1188 Secrimex, S.A. de C.V. contract, $618,192 Attention: Ana Maria Amador quasi-contract, Lopez trade Calle 2 No. 16 Col. Alce Blanco Naucalpan de Juarez C.P. 53370 Estado de Mexico Piso Prestigio S.A. de C.V. contract, $614,590 Attention: Adan Esparza quasi-contract, Sanchez trade Calz. Lazaro Cardenas 4145 Col. Camino Real Zapopan, Jal. C.P. 45040 Mexico Tel: 52-33-3647-4088 Su Casa Produce, LLC contract, $580,134 Attention: Victor Manuel Diaz quasi-contract, 188 Old Tucson Road trade P.O. Box 1381 Nogales, AZ 85628 tel: 520-281-1409 Agencia de Viajes K contract, $478,749 Attention: Rosa Maria Lopez quasi-contract, Ramirez trade Baedeker S.A. de C.V. Tlacotalpan 96 Esquina Tehuantepec Col. Roma Sur C.P. 6760 Mexico, D.F. Tel: 52-55-5-5574-4040 Promedia Computer S.A. de contract, $416,105 C.V. quasi-contract, Attention: Evangelina Reyes trade Perez Av. Baja California 196-201 Del. Benito Juarez C.P. 6700 Mexico, D.F. Tel: 52-55-5-5564-3994 Industrias John Crane contract, $400,000 de Mexico S.A de C.V. quasi-contract, Attention: Lic. Jesus Urdaneta trade Poniente 152 No. 667 Col. Industrial Vallejo C.P. 02300 Mexico, D.F. Tel: 52-55-5-5385-0525 Taurus-Espa A, S.a. de C.V. contract, $396,585 Attention: Jos� Luis Fernandez quasi-contract, Henriquez trade Rosas Moreno 4-203 Col. San Rafael C.P. 6470 Mexico, D.F. Tel: 52-55-5-5546-8162 ext. 239 Standard Machinery and Supply contract, $394,000 Co. S.A. de C.V. quasi-contract, Attention: Barbara Hernandez trade Larrieta Tenayuca 82 Fracc. Ind. Tlalnepantla C.P. 54030 Estado de Mexico Tel: 52-55-5-565-6741 Suspension Y Direccion S.A. de contract, $329,071 C.V. quasi-contract, Attention: Luis Becerril trade Colorado Dr. Lucio 211 Col. Doctores C.P. 06720 Mexico, D.F. Tel: 52-55-5134-0700 Instituto Tecnologico contract, $278,311 Autonomo de Mexico quasi-contract, Attention: Monica de Lourdes trade Arrieta Blanco Rio Hondo No. 1 Col Tizapan, San Angel C.P. 01000 Mexico, D.F. Tel: 52-55-5-5628-4000 Grupo Plastico Nova S.A. de contract, $277,872 C.V. quasi-contract, Attention: Laura Garcia trade Carrillo San Juan 768 Col. Granjas Modernas C.P. 07460 Mexico, D.F. Tel: 52-55-5-5748-0583 Suyun Yan Hu contract, $270,964 Dr. Salvador Garcia Diego quasi-contract, 209, Col. Doctores C.P. 06720 trade Mexico, D.F. Tel: 52-55-5-3096-8108 America Maria Luisa Taracido contract, $247,880 Berea quasi-contract, trade Rittal, S.A. de C.V. contract, $240,524 quasi-contract, trade Catalizadores Salh Mon S.A. de contract, $213,495 C.V. quasi-contract, trade CASELLA WASTE: Posts $4.6 Mil. Net Loss for the 2008 Third Quarter ------------------------------------------------------------------ Casella Waste Systems Inc. reports $4.6 million net loss for the third quarter ended Jan. 31, 2008, up from a net loss of $0.8 million for the same quarter in 2007. For the 2008 third quarter, the company reported revenues of $141.4 million, up $12.6 million, or 9.8% from $128.8 million of the 2007 third quarter. General and administration costs for the quarter include a $1.2 million non-recurring charge incurred as the result of the company's management reorganization. This reorganization charge resulted in an after tax impact of negative $0.03 per share. Including this one-time charge, operating income for the quarter was $7.3 million, down $1.8 million over the same quarter last year. Cash provided by operating activities in the quarter was $16.0 million, compared to $16.2 million for the same quarter last year. The company said its GreenFiber unit continues to be severely impacted by the slowdown in the housing market. The company's income from equity method investments was down $1.9 million compared to the same quarter last year, with the company's share of GreenFiber's net income down $1.6 million during this period. The year-over-year losses from equity method investments resulted in an after tax impact of negative $0.05 per share. For the nine months ended Jan. 31, 2008, the company reported revenues of $442.8 million, up 8.1% from $409.6 million revenues for the same period last year. Operating income for the nine month period was $36.4 million, up $3.8 million or 11.7% over the same period last year. Cash provided by operating activities for the nine month period was $51.7 million, down $4.7 million compared to the same period last year. As of Jan. 31, 2008, the company's balance sheet showed total assets of $830.1 million, total liabilities of $699.0 million and a total stockholders' equity of $131.0 million. About Casella Waste Headquartered in Rutland, Vermont, Casella Waste Systems Inc. (NASDAQ:CWST) -- http://www.casella.com/--provides collection, transfer, disposal and recycling services to residential, industrial and commercial customers, primarily in the eastern United States. It operates solid waste operations in Vermont, New Hampshire, New York, Massachusetts and Maine, and stand alone materials processing facilities in Pennsylvania, New Jersey, North Carolina, South Carolina, Tennessee, Georgia, Florida, Michigan and Wisconsin. As of May 31, 2007, the company owned and operated 38 solid waste collection operations, 32 transfer stations, 38 recycling facilities, eight Subtitle D landfills, two landfills permitted to accept construction and demolition materials, and one waste-to-energy facility, as well as a 50% interest in a joint venture that manufactures, markets and sells cellulose insulation made from recycled fiber and a 20.5% interest in a company that markets an incentive-based recycling service. * * * As reported in the Troubled Company Reporter on Feb. 22, 2008, Moody's Investors Service affirmed its debt ratings of Casella Waste Systems, Inc. as: corporate family and probability of default, each at B1, and senior subordinated at B3. Moody's changed the ratings outlook to negative from stable. CHAMP CAR: Goes Bankrupt, Plans to Sell Assets to Indy Racing ------------------------------------------------------------- Champ Car World Series LLC was put into chapter 11 bankruptcy by its counsels on March 5, 2008, John Oreovicz writes for ABC Local News in North Carolina. Despite the bankruptcy, Champ Car plans to proceed in the management of its business and operate as a debtor-in-possession, the report says. Champ Car is scheduled to host an open-wheel race in Long Beach, California -- http://www.longbeachgp.com/-- on April 18 to 20, 2008, the Debtor's alleged final event, ABC relates. In a statement filed with the Court, Champ Car vice president and chief financial officer, Gene Cottingham, said that the Debtor's board of managers has decided that it's no longer financially sound to continue and open-wheel series and found that there is insufficient money to operate the event this year, ABC notes. Champ Car's board is composed of Kevin Kalkhoven, Gerald Forsythe, Paul Gentilozzi and Dan Pettit, ABC reports. Its major owners are Kalkhoven, by its 21st Century Racing Holdings LLC unit and Forsythe by its Willis Capital LLC unit, ABC adds. Also, Champ Car plans to liquidate its assets related to the open- wheel racing to the Indy Racing League for the unification of open-wheel racing with Indy-style racing by the beginning of this year's season, ABC quotes Mr. Cottingham's statement. According to court documents, Champ Car's board have already decided to file for bankruptcy as early as Feb. 14, 2008, before major owners issued a memorandum of understanding, ABC relates. In the memorandum, Kalkhoven and Forsythe ordered the sale of "substantially all" of Champ Car's "intangible assets" and its "mobile medical unit to the IRL for $6 million," ABC reveals. The memorandum also provides $2 million each to the major owners who promised to support the open-wheel racing in Long Beach, ABC says. The Long Beach race is operated by Aquarium Holdings LLC, owned by Kalkhoven and Forsythe, ABC notes. On Feb. 2, 2004, Judge Frank J. Otte of the U.S. Bankruptcy Court for the Southern District of Indiana permitted the sale of Championship Auto Racing Teams Inc.'s assets to Kalkhoven and Forsythe's unit, which is now known as Champ Car World Series LLC, ABC reveals. The Troubled Company Reporter said on Jan. 2, 2006, that the stockholders of Championship Auto, aka CART Inc., approved on Dec. 29, 2005, the company's Plan of Liquidation and Dissolution offered for vote at a Special Meeting. About Champ Car Indianapolis-based Champ Car World Series LLC, fdba Open Wheel Racing Series LLC and Corkscrew Acquisition LLC, -- http://www.champcarworldseries.com/-- organizes and operates a racing circuit that features about 20 drivers competing in single- seat, open-wheeled race cars. The circuit includes more than a dozen race tracks and road courses in the US, Canada, Mexico, and Australia. It regulates the sport and promotes the races; it generates revenue from sponsorships and broadcasting rights. It filed for chapter 11 protection on March 5, 2008 (Bankr. S.D. Ind. Case No. 08-02172). Gary Lynn Hostetler, Esq., and Jeffrey A. Hokanson, Esq., at Hostetler & Kowalik PC represent the Debtor in its restructuring efforts. The Debtor had assets of between $10 million to $50 million and debts between $1 million to $10 million when it filed for bankruptcy. Its largest unsecured creditor, Cosworth Inc., is owed $1,825,000. CHINA AOXING: To Restate Financial Statements to Correct Errors --------------------------------------------------------------- On Feb. 28, 2008 China Aoxing Pharmaceutical Company Inc. was notified by its independent accountant, Paritz & Co., P.A., that the company's financial statements for the year ended June 30, 2007, should not be relied upon. In addition, the information provided by Paritz & Co. indicated that the financial statements contained in these filings also should not be relied upon: Form 10-QSB for the period ended December 31, 2006; Form 10-QSB for the period ended March 31, 2007; Form 10-KSB for the year ended June 30, 2007; Form 10-QSB for the period ended September 30, 2007; Form 10-QSB for the period ended December 31, 2007. The restatement of China Aoxing's financial statements is necessary to correct the improper accounting treatment for the sale of 1,058,000 units of securities by China Aoxing in the fall of 2006. The units consisted of either one convertible debenture and four common stock purchase warrants or one share of common stock and four common share purchase warrants. About China Aoxing Incorporated in the State of Florida and headquartered in Jersey City, New Jersey, China Aoxing Pharmaceutical Company Inc. (OTC BB: CAXG) is a pharmaceutical company engaged in research, development, manufacturing and marketing of a range of narcotics and pain management pharmaceutical products in generic and formulations. The company's operating subsidiary, Hebei Aoxing Pharmaceutical Co. Inc. is a corporation organized under the laws of the People's Republic of China. * * * Paritz & Company P.A., in Hackensack, New Jersey, expressed substantial doubt about China Aoxing Pharmaceutical Co. 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 said that the company's current liabilities substantially exceeded its current assets. CLEAR CHANNEL: Extends Closing of Notes Tender Offer to March 18 ---------------------------------------------------------------- Clear Channel Communications Inc. extended the date on which: -- the pricing for the Notes will be established from 2:00 p.m. New York City time on March 6, 2008, to 2:00 p.m. New York City time on March 14, 2008; -- the tender offers are scheduled to expire from 8:00 a.m. New York City time on March 10, 2008, to 8:00 a.m. New York City time on March 18, 2008; and -- the consent payment deadline for the Notes from 8:00 a.m. New York City time on March 10, 2008, to 8:00 a.m. New York City time on March 18, 2008. Each of the Price Determination Date, the Offer Expiration Date and the Consent Payment Deadline is subject to extension by Clear Channel, with respect to the for its outstanding 7.65% Senior Notes due 2010 (CUSIP No. 184502AK8) and Clear Channel's subsidiary AMFM Operating Inc.'s outstanding 8% Senior Notes due 2008 (CUSIP No. 158916AL0), in their sole discretion. Clear Channel disclosed on Jan. 2, 2008, that it had received, pursuant to its tender offer and consent solicitation for the CCU Notes, the requisite consents to adopt the proposed amendments to the CCU Notes and the indenture governing the CCU Notes applicable to the CCU Notes, and that AMFM had received, pursuant to its tender offer and consent solicitation for the AMFM Notes, the requisite consents to adopt the proposed amendments to the AMFM Notes and the indenture governing the AMFM Notes. The Clear Channel tender offer and consent solicitation is being made pursuant to the terms and conditions set forth in the Clear Channel Offer to Purchase and Consent Solicitation Statement for the CCU Notes dated Dec. 17, 2007, and the related Letter of Transmittal and Consent. The AMFM tender offer and consent solicitation is being made pursuant to the terms and conditions set forth in the AMFM Offer to Purchase and Consent Solicitation Statement for the AMFM Notes dated Dec. 17, 2007, and the related Letter of Transmittal and Consent. Clear Channel has retained Citi to act as the lead dealer manager for the tender offers and lead solicitation agent for the consent solicitations and Deutsche Bank Securities Inc. and Morgan Stanley & Co. Incorporated to act as co-dealer managers for the tender offers and co-solicitation agents for the consent solicitations. Global Bondholder Services Corporation is the Information Agent for the tender offers and the consent solicitations. Questions regarding the transaction should be directed to Citi at (800) 558- 3745 (toll-free) or (212) 723-6106 (collect). Requests for documentation should be directed to Global Bondholder Services Corporation at (212) 430-3774 (for banks and brokers only) or (866) 924-2200 (for all others toll-free). The tender offers and consent solicitations for the Notes are made in connection with the merger with BT Triple Crown Merger Co. Inc. The completion of the Merger and the related debt financings are not subject to, or conditioned upon, the completion of the tender offers or the related consent solicitations or the adoption of the proposed amendments with respect to the Notes. The closing of the Merger is expected to occur during the first quarter 2008. The closing of the Merger is subject to customary closing conditions. About Clear Channel Based in San Antonio, Texas, Clear Channel Communications Inc. (NYSE:CCU) -- http://www.clearchannel.com/-- is a media and entertainment company specializing in "gone from home" entertainment and information services for local communities and premiere opportunities for advertisers. The company's businesses include radio, television and outdoor displays. Outside U.S., the company operates in 11 countries -- Norway, Denmark, the United Kingdom, Singapore, China, the Czech Republic, Switzerland, the Netherlands, Australia, Mexico and New Zealand. * * * As reported in the Troubled Company Reporter on Jan. 30, 2008, Standard & Poor's Ratings Services said its ratings on Clear Channel Communications, including the 'B+' corporate credit rating, remain on CreditWatch with negative implications. S&P originally placed them on CreditWatch on Oct. 26, 2006, following the company's announcement that it was exploring strategic alternatives to enhance shareholder value. CNL FUNDING: Fitch Chips Ratings on Three Certificate Classes ------------------------------------------------------------- Fitch Ratings has taken these rating actions on the three CNL Funding Franchise Loan Transactions listed below: CNL Funding 1998-1, LP -- Classes IO-1, IO-2, A-1b, and A-2b affirmed at 'AAA'; -- Classes B-1 and B-2 affirmed at 'AA'; -- Classes C-1 and C-2 affirmed at 'A'; -- Classes D-1 and D-2 affirmed at 'BBB+'; -- Class E-1 downgraded to 'BB+' from 'BBB-'; -- Class E-2 affirmed at 'BBB-'; -- Class F-1 downgraded to 'B+' from 'BB-'; -- Class F-2 affirmed at 'BB'; -- Class G-1 downgraded to 'CC/DR4' from 'CCC/DR3'; -- Class G-2 affirmed at 'B-/DR1'. Classes E-1, F-1, F-2, G-1, and G-2 are removed from Rating Watch Negative. CNL Funding 1999-1, LP -- Classes IO, A-1, and A-2 affirmed at 'AAA'; -- Class B affirmed at 'AA'; -- Class C affirmed at 'A'; -- Class D affirmed at 'A-'. CNL Funding 2000-A, LP Class A-2, currently rated 'AAA', remains on Rating Watch Negative.* * Class A-2 rating is based on the strength of the MBIA insurance policy. On March 15, 2007 Fitch downgraded classes F-1, G-1, and G-2 and placed on Rating Watch Negative classes E-1, F-1, F-2, G-1, and G-2 of the 1998-1 transaction. The fixed rate notes are supported by a pool of fixed rate loans and perform independently from the variable rate notes which are supported by a pool of variable rate loans. The downgrades and Rating Watch Negative assignments were due to the special servicing of two large obligors, one in the variable rate collateral pool and the other in the fixed rate pool, facing cash flow concerns. Since that time, the obligor in the variable rate pool has been removed from special servicing, resulting in the removal of the Rating Watch Negative on the variable rate classes. While the fixed rate obligor remains current on all payments, their situation has not yet been resolved and it is unlikely that it will be in the near future. The size of the obligor and the uncertainty regarding the final recovery of the outstanding loan balance led to the downgrade and removal of Rating Watch Negative on certain fixed rate classes. Fitch's analysis incorporated anticipated losses on defaulted and specially serviced collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral-specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, negative rating actions were taken on the CNL Funding 1998-1 fixed rate notes as listed above while remaining transactions were found to have credit support consistent with Fitch's previous review resulting in the affirmation of the current ratings. CONTINENTAL AIRLINES: Pilots Rally on March 12 in Support of Talks ------------------------------------------------------------------ Pilots at Continental Airlines Inc., represented by the Air Line Pilots Association International, are rallying to tell management: "the loan is due." The rally will be from 8:00 a.m. to 9:15 a.m. ET on Wednesday, March 12, 2008, at the Newark Airport Hotel at 1000 Spring Street, in Elizabeth, New Jersey. Pilots will also hold informational picketing lines at the NYC Financial District in Broad Street and Exchange Pl from 11:00 a.m. to 1:00 p.m. ET and a rally in Battery Park, Clinton Castle from 1:30 p.m. to 2:25 p.m. ET. Continental Airlines pilots gave up more than $200 million annually in concessions in their last contract as a "loan" to help Continental Airlines overcome the threat of bankruptcy and help management achieve success. Continental is now one of the most prosperous airline carriers, achieving a 2007 pre-tax profit of $566 million. Continental pilots believe the time for repayment of their "loan" is now due and they should share in the rewards and profits made possible by their sacrifices that are now being enjoyed by management. Continental pilots are preparing for the start of negotiations for the economic items of their contract (pay, benefits, etc.), which becomes amendable Dec. 31, 2008. Hundreds of pilots, in uniform, will be conducting informational picketing in the Financial District, followed by a rally in Battery Park. Speakers at Battery Park will include Continental union leader Capt. Jay Pierce, local union representative Capt. Al Brandano, and ALPA president Capt. John Prater. About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/ -- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 2,900 daily departures throughout the Americas, Europe and Asia, serving 144 domestic and 139 international destinations. More than 500 additional points are served via SkyTeam alliance airlines. With more than 45,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with Continental Express, carries approximately 69 million passengers per year. * * * As reported in the Troubled Company Reporter on Dec. 27, 2007, Fitch Ratings affirmed Continental Airlines 'B-' issuer default rating with a stable outlook. COUNTRYWIDE HOME: S&P Takes Various Rating Actions on RMBS Deals ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on 17 classes of U.S. residential mortgage-backed securities from 10 Countrywide Home Loan Mortgage Pass-Through Trust transactions backed by prime jumbo mortgage collateral. At the same time, S&P lowered its ratings on 29 classes and affirmed its ratings on 986 classes from various CHL transactions. The raised ratings reflect collateral pool performance, which has allowed current and projected credit support to increase to levels that are adequate to support the upgrades. Projected credit support ranges from 1.91x to 3.66x the loss coverage levels associated with the raised ratings. The average projected credit support coverage is 2.37x. Cumulative losses for these series ranged from 0.00% to 0.10% of the original pool balances. Severe delinquencies (90-plus days, foreclosures, and REOs) ranged from 0.00% to 3.11% of the current pool balances. The upgraded deals have paid down to less than 31.28% of their original pool balances. The lowered ratings are based on the deterioration of available credit support provided by the senior-subordinate structure of the deals and S&P's projected losses based on the dollar amount of loans in the delinquency pipeline. In each case, the projected credit support remaining after projecting losses is no longer sufficient to warrant the prior rating. Cumulative losses for these series ranged from 0.10% to 0.13% of the original pool balances. Severe delinquencies ranged from 3.19% to 5.44% of the current pool balances. The downgraded deals have paid down to less than 55.13% of their original pool balances. The affirmations are based on pool performance that has allowed current and projected credit support to remain at levels that are adequate to support the current ratings. Cumulative losses for these series ranged from 0.00% to 0.13% of the original pool balances. Severe delinquencies ranged from 0.00% to 5.44% of the current pool balances. The affirmed deals have paid down to less than 74.20% of the original pool balances, and one deal has paid down to 0.61% of its original pool balance. The underlying collateral backing these transactions consists primarily of prime jumbo, fully amortizing fixed- and adjustable- rate first-lien mortgage loans secured by one- to four-family residential properties. The original loan terms ranged from 15 years to 30 years. Subordination is the predominant form of credit support protecting the certificates from losses. Ratings Lowered CHL Mortgage Pass-Through Trust Rating ------ Transaction Class To From ----------- ----- -- ---- 2003-27 B-2 B BBB 2003-27 B-3 CCC BB 2003-27 B-4 CCC B 2003-HYB1 B-2 BBB A 2004-6 B-2 BB BBB 2004-6 B-3 B BB 2004-6 B-4 CCC B 2004-12 I-B-3,II-B-3 B BB 2004-12 I-B-4,II-B-4 CCC B 2004-20 B-2a,B-2b BB BBB 2004-23 B-4 CCC B 2004-29 1-B-3,II-B-3 B BB 2004-29 1-B-4,II-B-4 CCC B 2004-HYB1 B-3 BB BB+ 2004-HYB1 B-4 CCC B 2004-HYB3 B-3 B BB 2004-HYB6 B-2 BB BBB 2004-HYB6 B-3 B BB 2004-HYB6 B-4 CCC B 2004-HYB8 II-B-3 B BB 2004-HYB8 I-B-4,II-B-4 CCC B 2004-HYB9 2-B-3 B BB 2004-HYB9 2-B-4 CCC B Ratings Raised CHL Mortgage Pass-Through Trust Rating ------ Transaction Class To From ----------- ----- -- ---- 2002-18 B-1 AAA AA+ 2002-18 B-2 AA A+ 2002-19 B-2 AAA AA+ 2002-21 B-1 AAA AA+ 2002-21 B-2 AA A+ 2002-25 B-2 AA+ AA 2002-26 B-1 AAA AA+ 2002-26 B-2 AA+ A 2002-27 B-1 AAA AA+ 2002-27 B-2 AA AA- 2002-31 B-1 AAA AA+ 2002-31 B-2 AA AA- 2002-32 B-1 AAA AA+ 2002-32 B-2 AA A+ 2002-39 B-1 AA+ AA 2003-8 M AA+ AA 2003-8 B-1 AA- A Ratings Affirmed CHL Mortgage Pass-Through Trust Transaction Class Rating ----------- ----- ------ 2001-HYB1 1-A-1,2-A-1,3-A-1 AAA 2001-HYB1 3-A-2 AAA 2002-18 A-1,A-8,A-9,PO,M AAA 2002-19 1-A-1,1-A-13,2-A-2 AAA 2002-19 2-A-3,2-A-4,PO,M AAA 2002-19 B-1 AAA 2002-21 A-1,A-3,PO,M AAA 2002-22 A-20,PO AAA 2002-25 1-A-12,1-A-13 AAA 2002-25 1-A-14,1-A-15,1-X AAA 2002-25 2-A-1,2-X,PO,M,B-1 AAA 2002-26 A-1,A-2,A-3,A-4,A-5 AAA 2002-26 PO,M AAA 2002-27 A-1,A-6,A-8,A-9 AAA 2002-27 PO,M AAA 2002-30 A-1,A-2,A-3,M AAA 2002-30 B-1 AA+ 2002-30 B-2 A 2002-31 A-1,A-2,A-3,A-5,A-6 AAA 2002-31 A-13,A-14,PO,M AAA 2002-31 A-7,A-8,A-10,A-11 AAA 2002-32 1-A-20,1-A-21,1-X AAA 2002-32 1-A-8,1-A-18,1-A-19 AAA 2002-32 2-A-2,2-A-4,2-A-5 AAA 2002-32 2-A-6,2-A-7,3-A-1 AAA 2002-32 3-X,PO,M AAA 2002-35 1-A-1,1-A-2,1-A-3 AAA 2002-35 1-A-4,1-A-5,1-A-6 AAA 2002-35 1-A-8,2-A-1,2-A-3 AAA 2002-35 2-A-13,2-A-14,3-A-1 AAA 2002-35 2-A-4,2-A-6,2-A-7 AAA 2002-35 2-A-8,2-A-9,2-A-10 AAA 2002-35 4-A-1,4-A-2,4-A-3 AAA 2002-35 4-A-4,4-A-5,PO,M AAA 2002-35 B-1 AA+ 2002-35 B-2 AA 2002-38 A-1,A-2,A-3,PO AAA 2002-38 M AA 2002-38 B-1 A 2002-38 B-2 BBB 2002-39 A-1,A-16,A-17,A-18 AAA 2002-39 A-35,A-36,A-37,A-38 AAA 2002-39 PO,M AAA 2002-39 B-2 A+ 2002-J4 I-A-15,I-A-16,2-A-1 AAA 2002-J4 PO,M,B-1,B-2 AAA 2002-J5 1-A-13,1-A-14 AAA 2002-J5 1-A-15,1-A-16 AAA 2002-J5 1-A-17,1-X,2-A-1 AAA 2002-J5 2-X,3-A-1,PO,M,B-1 AAA 2002-J5 B-2 AA 2002-J5 B-3 A 2002-J5 B-4 BBB 2003-2 A-1,A-2,A-3,A-4 AAA 2003-2 A-14,A-15,A-16,A-17 AAA 2003-2 A-18 AAA 2003-8 A-1,A-2,A-3,A-4,A-5 AAA 2003-8 A-6,A-7,A-8,PO AAA 2003-8 B-2 BBB 2003-8 B-3 BB 2003-8 B-4 B 2003-14 A-1,A-2,A-3,A-4,A-5 AAA 2003-14 A-10,A-11,A-12,A-13 AAA 2003-14 A-14,A-15,A-16,A-17 AAA 2003-14 A-18,A-19,A-20,A-21 AAA 2003-14 A-22,A-23,A-24,A-25 AAA 2003-14 A-6,A-7,A-8,A-9 AAA 2003-14 PO AAA 2003-15 1-A-1,1-A-2,2-A-1 AAA 2003-15 2-A-2,PO AAA 2003-15 M AA 2003-15 B-1 A 2003-15 B-2 BBB 2003-15 B-3 BB 2003-15 B-4 B 2003-20 1-A-1,1-A-2,1-A-3 AAA 2003-20 1-A-12,1-A-13 AAA 2003-20 1-A-14,1-A-15 AAA 2003-20 1-A-16,1-A-17,2-A-1 AAA 2003-20 1-A-4,1-A-5,1-A-8 AAA 2003-20 1-A-9,1-A-10,1-A-11 AAA 2003-20 2-A-2,2-A-3,2-A-4 AAA 2003-20 2-A-5,2-A-6,2-A-7 AAA 2003-20 2-A-9,2-A-10,3-A-1 AAA 2003-20 3-A-2,3-A-3,3-A-4 AAA 2003-20 3-A-5,3-A-6,3-A-7 AAA 2003-20 3-A-8,3-A-9,3-A-10 AAA 2003-20 PO AAA 2003-20 M AA 2003-20 B-1 A 2003-20 B-2 BBB 2003-20 B-3 BB 2003-20 B-4 B 2003-21 A-1,A-2,A-3 AAA 2003-21 M AA+ 2003-21 B-1 AA- 2003-21 B-2 BBB+ 2003-21 B-3 BB+ 2003-21 B-4 B 2003-26 1-A-1,1-A-2,1-A-3 AAA 2003-26 1-A-4,1-A-6,2-A-1 AAA 2003-26 2-A-2,2-A-3,2-A-4 AAA 2003-26 PO AAA 2003-27 A-1 AAA 2003-27 M AA+ 2003-27 B-1 A 2003-35 1-A-1,1-A-2,1-A-3 AAA 2003-35 2-A-1,PO AAA 2003-35 M AA 2003-35 B-1 A 2003-35 B-2 BBB 2003-35 B-3 BB 2003-35 B-4 B 2003-37 I-A-1,2-A-1,2-A-2 AAA 2003-37 M AA+ 2003-37 B-1 A 2003-37 B-2 BBB 2003-37 B-3 BB 2003-37 B-4 B 2003-40 A-1,A-2,A-3,A-5,PO AAA 2003-40 M AA 2003-40 B-1 A 2003-40 B-2 BBB 2003-40 B-3 BB 2003-40 B-4 B 2003-42 1-A-1,2-A-2,2-A-3 AAA 2003-42 2-A-4,2-X-1,2-X-2 AAA 2003-42 2-X-3 AAA 2003-42 M AA 2003-42 B-1 A 2003-42 B-2 BBB 2003-42 B-3 BB 2003-42 B-4 B 2003-43 A-1 AAA 2003-43 M AA 2003-43 B-1 A 2003-43 B-2 BBB 2003-43 B-3 BB 2003-43 B-4 B 2003-46 1-A-1,1-A-2,1-A-3 AAA 2003-46 2-A-1,3-A-1,4-A-1 AAA 2003-46 4-A-2,5-A-1,6-A-1 AAA 2003-46 7-A-1 AAA 2003-46 M AA 2003-46 B-1 A 2003-46 B-2 BBB 2003-46 B-3 BB 2003-46 B-4 B 2003-48 1-A-1,2-A-1,2-A-2 AAA 2003-48 2-A-3,2-X-1 AAA 2003-48 M AA 2003-48 B-1 A 2003-48 B-2 BBB 2003-48 B-3 BB 2003-48 B-4 B 2003-49 A-2,A-3,A-4,A-5 AAA 2003-49 A-6,A-7,A-8-A AAA 2003-49 A-8-B,A-9,X AAA 2003-49 M AA 2003-49 B-1 A 2003-49 B-2 BBB 2003-49 B-3 BB 2003-49 B-4 B 2003-50 A-1,PO AAA 2003-52 A-1,A-2 AAA 2003-52 M AA+ 2003-52 B-1 A 2003-52 B-2 BBB 2003-52 B-3 BB 2003-52 B-4 B 2003-53 A-1 AAA 2003-53 M AA+ 2003-53 B-1 A 2003-53 B-2 BBB 2003-53 B-3 BB 2003-53 B-4 B 2003-54 A-1 AAA 2003-54 M AA 2003-54 B-1 A 2003-54 B-2 BBB 2003-54 B-3 BB 2003-54 B-4 B 2003-56 1-A-1,2-A-5,2-X AAA 2003-56 3-A-5,3-A-6,3-A-7A AAA 2003-56 3-A-7B,3-A-7C,3-X AAA 2003-56 4-A-1,4-A-2,5-A-1 AAA 2003-56 5-X,6-A-1,7-A-1,7-X AAA 2003-56 8-A-1,9-A-1 AAA 2003-56 M AA 2003-56 B-1 A 2003-56 B-2 BBB 2003-56 B-3 BB 2003-56 B-4 B 2003-58 1-A,2-A-1,2-A-2 AAA 2003-58 2-X,3-A AAA 2003-58 M AA 2003-58 B-1 A 2003-58 B-2 BBB 2003-58 B-3 BB 2003-58 B-4 B 2003-60 1-A-1,2-A-1,3-A-1 AAA 2003-60 4-A-1 AAA 2003-60 M AA+ 2003-60 B-1 A+ 2003-60 B-2 BBB 2003-60 B-3 BB 2003-60 B-4 B 2003-HYB1 1-A-1,2-A-1,3-A-1 AAA 2003-HYB1 1-X,M AAA 2003-HYB1 B-1 AA+ 2003-HYB2 1-A-1,2-A-1,1-X AAA 2003-HYB2 M AA+ 2003-HYB2 B-1 A+ 2003-HYB2 B-2 BBB 2003-HYB2 B-3 BB 2003-HYB2 B-4 B 2003-HYB3 1-A-1,2-A-1,3-A-1 AAA 2003-HYB3 4-A-1,5-A-1,6-A-1 AAA 2003-HYB3 7-A-1,8-A-1,1-X AAA 2003-HYB3 M AA+ 2003-HYB3 B-1 A+ 2003-HYB3 B-2 BBB 2003-HYB3 B-3 BB 2003-HYB3 B-4 B 2003-J1 1-A-8,1-A-12,1-A-13 AAA 2003-J1 1-X,2-A-1,2-X,PO,M AAA 2003-J1 B-1 AA+ 2003-J1 B-2,B-3 AA 2003-J1 B-4 A 2003-J2 A-1,A-2,A-3,A-4,A-5 AAA 2003-J2 A-15,A-16,A-17 AAA 2003-J2 A-19,A-20,A-21 AAA 2003-J2 A-22,A-27,A-31,X AAA 2003-J2 PO,M AAA 2003-J2 B-1 AA+ 2003-J2 B-2 AA 2003-J2 B-3 A 2003-J2 B-4 BBB 2003-J3 1-A-1,1-A-2,1-A-3 AAA 2003-J3 1-A-8,1-A-9,1-A-10 AAA 2003-J3 1-X,2-A-1,2-X,PO AAA 2003-J3 M AA+ 2003-J3 B-1 AA 2003-J3 B-2 AA- 2003-J3 B-3 A 2003-J3 B-4 BB 2003-J4 1-A-1,1-A-2,1-A-3 AAA 2003-J4 1-A-15,1-A-17 AAA 2003-J4 1-A-18,1-A-19,1-X AAA 2003-J4 1-A-4,1-A-5,1-A-6 AAA 2003-J4 1-A-7,1-A-13,1-A-14 AAA 2003-J4 2-A-1,2-X,PO AAA 2003-J4 M AA 2003-J4 B-1 A 2003-J4 B-2 BBB 2003-J4 B-3 BB 2003-J4 B-4 B 2003-J5 1-A-1,1-A-2,1-A-3 AAA 2003-J5 1-A-10,1-A-11 AAA 2003-J5 1-A-12,1-X,2-A-1 AAA 2003-J5 1-A-4,1-A-5,1-A-6 AAA 2003-J5 1-A-7,1-A-8,1-A-9 AAA 2003-J5 2-X,PO AAA 2003-J5 M AA+ 2003-J5 B-1 AA 2003-J5 B-2 A+ 2003-J5 B-3 A- 2003-J5 B-4 BBB- 2003-J6 1-A-1,2-A-1,2-A-2 AAA 2003-J6 2-A-3,2-X,3-A-1,PO AAA 2003-J6 M AA+ 2003-J6 B-1 AA 2003-J6 B-2 A 2003-J6 B-3 BBB 2003-J6 B-4 BB+ 2003-J7 1-A-1,1-A-2,1-A-3 AAA 2003-J7 1-X,2-A-1,2-A-2 AAA 2003-J7 2-A-10,2-A-11 AAA 2003-J7 2-A-12,2-A-13 AAA 2003-J7 2-A-14,2-X,3-A-1 AAA 2003-J7 2-A-3,2-A-5,2-A-6 AAA 2003-J7 2-A-7,2-A-8,2-A-9 AAA 2003-J7 3-A-2,3-A-3,3-X AAA 2003-J7 4-A-1,4-A-2,4-A-3 AAA 2003-J7 4-X,PO AAA 2003-J7 M AA+ 2003-J7 B-1 AA 2003-J7 B-2 A 2003-J7 B-3 BBB 2003-J7 B-4 BB+ 2003-J8 1-A-1,1-A-2,1-A-3 AAA 2003-J8 1-A-4,1-X,2-A-1,2-X AAA 2003-J8 PO AAA 2003-J8 M AA+ 2003-J8 B-1 AA 2003-J8 B-2 A- 2003-J8 B-3 BBB 2003-J8 B-4 B 2003-J9 1-A-1,1-A-2,1-A-3 AAA 2003-J9 1-A-4,1-A-5,1-A-6 AAA 2003-J9 1-A-7,1-X,2-A-1 AAA 2003-J9 2-X,3-A-1,3-A-2 AAA 2003-J9 3-X,PO AAA 2003-J9 M AA 2003-J9 B-1 A 2003-J9 B-2 BBB 2003-J9 B-3 BB 2003-J9 B-4 B 2003-J10 1-A-1,1-A-2,1-A-3 AAA 2003-J10 1-A-10,1-X,2-A-1 AAA 2003-J10 1-A-4,1-A-5,1-A-6 AAA 2003-J10 1-A-7,1-A-8,1-A-9 AAA 2003-J10 2-X,3-A-1,3-X,PO AAA 2003-J10 M AA 2003-J10 B-1 A 2003-J10 B-2 BBB 2003-J10 B-3 BB 2003-J10 B-4 B 2003-J13 1-A-1,1-A-3,1-A-4 AAA 2003-J13 1-A-5,1-A-6,1-A-7 AAA 2003-J13 1-A-8,1-A-9,1-X AAA 2003-J13 2-A-1,2-A-2,2-X AAA 2003-J13 3-A-1,3-X,PO AAA 2003-J13 M AA 2003-J13 B-1 A 2003-J13 B-2 BBB 2003-J13 B-3 BB 2003-J13 B-4 B 2003-J15 1-A-1,1-X,2-A-1 AAA 2003-J15 2-X,3-A-1,3-X,PO AAA 2003-J15 M AA 2003-J15 B-1 A 2003-J15 B-2 BBB 2003-J15 B-3 BB 2003-J15 B-4 B 2004-2 1-A-1,2-A-1,3-A-1 AAA 2004-2 M AA+ 2004-2 B-1 A+ 2004-2 B-2 BBB+ 2004-2 B-3 BB+ 2004-2 B-4 B 2004-4 A-4 AA 2004-6 1-A-1,1-A-2,1-A-3 AAA 2004-6 1-X,2-A-1 AAA 2004-6 M AA 2004-6 B-1 A 2004-7 1-A-1,2-A-1,3-A-1 AAA 2004-7 3-X,4-A-1,4-X,5-A-1 AAA 2004-7 5-A-2,5-A-3,6-A-1 AAA 2004-7 II-X AAA 2004-7 I-M AA 2004-7 I-B-1 A 2004-7 I-B-2 BBB 2004-7 I-B-3 BB 2004-7 I-B-4 B 2004-10 A-1,A-2,A-3,A-4,A-5 AAA 2004-10 A-10,PO,A-R AAA 2004-10 A-6,A-7,A-8,A-9 AAA 2004-10 M AA 2004-10 B-1 A 2004-10 B-2 BBB 2004-10 B-3 BB 2004-10 B-4 B 2004-11 1-A-1,2-A-1,3-A-1 AAA 2004-11 3-A-2 AAA 2004-11 M AA+ 2004-11 B-1 A+ 2004-11 B-2 BBB+ 2004-11 B-3 BB 2004-11 B-4 B 2004-12 11-A-2,11-A-3 AAA 2004-12 12-A-1,13-A-1 AAA 2004-12 14-A-1,14-A-3 AAA 2004-12 15-A-1,16-A-1 AAA 2004-12 16-A-2,II-X AAA 2004-12 1-A-1,1-A-2,2-A-1 AAA 2004-12 3-A-1,4-A-1,5-A-1 AAA 2004-12 6-A-1,7-A-1,7-A-2 AAA 2004-12 8-A-1,8-A-2,9-A-1 AAA 2004-12 9-A-2,10-A-1,11-A-1 AAA 2004-12 I-M,II-M AA 2004-12 I-B-1,II-B-1 A 2004-12 I-B-2,II-B-2 BBB 2004-14 1-A-1,2-A-4,2-A-5 AAA 2004-14 3-A-1,4-A-1,4-A-2 AAA 2004-14 M AA 2004-14 B-1 A 2004-14 B-2 BBB 2004-14 B-3 BB 2004-14 B-4 B 2004-15 1-A,2-A,3-A,4-A,5-A AAA 2004-15 M AA 2004-15 B-1 A 2004-15 B-2 BBB 2004-15 B-3 BB 2004-15 B-4 B 2004-16 1-A-1,1-A-2,1-A-3A AAA 2004-16 1-A-3B,1-A-4A AAA 2004-16 1-A-4B,2-A-1,X AAA 2004-16 M AA+ 2004-16 B-1 A 2004-16 B-2 BBB 2004-16 B-3 BB 2004-16 B-4 CCC 2004-20 1-A-1,2-A-1,2-A-2 AAA 2004-20 3-A-1,X AAA 2004-20 M AA 2004-20 B-1 A 2004-20 B-3 B 2004-20 B-4 CCC 2004-22 A-1,A-2,A-3,X-2,X-3 AAA 2004-22 A-R AAA 2004-22 M AA 2004-22 B-1 A 2004-22 B-2 BBB 2004-22 B-3 BB 2004-22 B-4 B 2004-23 A,X AAA 2004-23 M AA+ 2004-23 B-1 A+ 2004-23 B-2 BBB 2004-23 B-3 BB 2004-23 B-4 B 2004-29 1-A-1,1-A-2,1-X AAA 2004-29 2-A-1,2-A-2,2-X AAA 2004-29 2-PO,3-A-1,3-X AAA 2004-29 3-PO,II-IO AAA 2004-29 1-M-1,II-M-1 AA 2004-29 1-B-1,II-B-1 A 2004-29 1-B-2,II-B-2 BBB 2004-HYB1 1-A,2-A,2-X AAA 2004-HYB1 M AA+ 2004-HYB1 B-1 A+ 2004-HYB1 B-2 BBB+ 2004-HYB2 1-A,1-X,2-A,3-A,3-X AAA 2004-HYB2 4-A,5-A,6-A AAA 2004-HYB2 M AA 2004-HYB2 B-1 A 2004-HYB2 B-2 BBB 2004-HYB2 B-3 BB 2004-HYB2 B-4 B 2004-HYB3 1A,2-A,3-A AAA 2004-HYB3 M AA 2004-HYB3 B-1 A 2004-HYB3 B-2 BBB 2004-HYB3 B-4 CCC 2004-HYB5 1-A-1,2-A-1,3-A-1 AAA 2004-HYB5 3-A-2,4-A-1,4-A-2 AAA 2004-HYB5 5-A-1,6-A-1,6-A-2 AAA 2004-HYB5 7-A-1,8-A-1,8-X AAA 2004-HYB5 I-B-1,II-B-1 AA 2004-HYB5 I-B-2,II-B-2 A 2004-HYB5 I-B-3,II-B-3 BBB 2004-HYB5 I-B-4,II-B-4 BB 2004-HYB5 I-B-5,II-B-5 B 2004-HYB6 A-1,A-2,A-3,A-4,X AAA 2004-HYB6 M AA 2004-HYB6 B-1 A 2004-HYB7 1-A-1,1-A-2 AAA 2004-HYB7 1-A-1-IO,1-A-2-IO AAA 2004-HYB7 1-A-3,2-A,3-A AAA 2004-HYB7 3-A-IO,4-A,4-A-IO AAA 2004-HYB7 5-A,5-A-IO AAA 2004-HYB7 M AA 2004-HYB7 B-1 A 2004-HYB7 B-2 BBB 2004-HYB7 B-3 BB 2004-HYB7 B-4 B 2004-HYB8 1-A-1,2-A-1,3-A-1 AAA 2004-HYB8 4-A-1,5-A-1,6-A-1 AAA 2004-HYB8 7-A-1,8-A-1,9-A-1 AAA 2004-HYB8 I-X,II-X AAA 2004-HYB8 I-M-1 AA+ 2004-HYB8 I-M-2,II-M AA 2004-HYB8 I-B-1,II-B-1 A 2004-HYB8 I-B-2,II-B-2 BBB 2004-HYB8 I-B-3 BB 2004-HYB9 1-A-1,2-A-1,2-A-2 AAA 2004-HYB9 1-B-1,2-M AA 2004-HYB9 1-B-2,2-B-1 A 2004-HYB9 1-B-3,2-B-2 BBB 2004-HYB9 1-B-4 BB 2004-HYB9 1-B-5 B 2004-J7 1-A1,1-A-2,1-A-3 AAA 2004-J7 1-A-10,1-A-11,1-X AAA 2004-J7 1-A-4,1-A-5,1-A-6 AAA 2004-J7 1-A-7,1-A-8,1-A-9 AAA 2004-J7 2-A-1,2-A-2,2-X AAA 2004-J7 3-A-1,3-X,PO AAA 2004-J7 M AA 2004-J7 B-1 A 2004-J7 B-2 BBB 2004-J7 B-3 BB 2004-J7 B-4 B 2004-J8 1-A-1,1-A-2,1-A-3 AAA 2004-J8 1-X,2-A-1,2-A-2,2-X AAA 2004-J8 3-A-2,3-A-4,3-A-5 AAA 2004-J8 3-A-6,3-A-7,3-A-8 AAA 2004-J8 3-X AAA 2004-J8 PO-A,PO-B,3-A-3 AAA 2004-J9 1-A-1,2-A-1,2-A-2 AAA 2004-J9 2-A-3,2-A-4,2-A-5 AAA 2004-J9 2-A-6,3-A-1,4-A-1 AAA 2004-J9 X-A-1,X-A-2,X-B-1 AAA 2004-J9 X-B-2,PO-A,PO-B AAA CUMULUS MEDIA: Agrees to Amend Credit Deal to Consummate Merger --------------------------------------------------------------- Pursuant to the definitive merger agreement with an investor group led by Lewis W. Dickey Jr., Cumulus Media Inc.'s chairman, president, and chief executive officer, and an affiliate of Merrill Lynch Global Private Equity (Buying Group), Cumulus disclosed Wednesday that it has agreed, upon request of the Buying Group, to use its reasonable best efforts to enter into an amendment to its existing credit agreement to permit the consummation of the merger and the other transactions contemplated by the merger agreement. These amendments include, without limitation, those provisions pertaining to the definition of "Change of Control" in the existing credit agreement, and to obtain a commitment from Bank of America N.A., the administrative agent under the existing credit agreement, or its affiliates, to provide for incremental facilities in an amount not less that $180.0 million, on terms as directed by the Buying Group for the purpose of substituting such additional commitment, and maintaining the company's existing indebtedness, in place of the debt commitment received by the Buying Group from Merrill Lynch Capital Corporation and Merrill Lynch, Pierce Fenner & Smith Incorporated. As reported in the Troubled Company Reporter on July 24, 2007, the Buying Group will acquire Cumulus in a transaction valued at approximately $1.3 billion. Consummation of the merger remains subject to various conditions, including approval of the merger by the stockholders of the company, FCC approval and other customary closing conditions. About Cumulus Media Headquartered in Atlanta, Georgia, Cumulus Media, Inc. (NASDAQ-GS: CMLS) -- http://www.cumulus.com/-- owns and operates FM and AM radio station clusters serving mid-sized markets throughout the U.S. As of Dec. 31, 2006, directly and through its investment in Cumulus Media Partners LLC, it owned or operated 344 stations in 67 U.S. markets and provided sales and marketing services under local marketing, management and consulting agreements to one additional station. * * * Cumulus Media Inc. still carries Moody's Ba3 corporate family rating assigned on July 24, 2007. DURA AUTOMOTIVE: Files Revised Plan of Reorganization ----------------------------------------------------- DURA Automotive Systems, Inc. and its debtor-affiliates filed its revised Chapter 11 Plan of Reorganization with the U.S. Bankruptcy Court for the District of Delaware. The Plan reflects a consensual agreement among DURA'S key creditor constituencies. DURA intends to proceed on an expedited basis to obtain Court approval of the Plan and emerge from Chapter 11. "The filing marks an important milestone in the company's efforts to emerge from its Chapter 11 reorganization process in the very near term," Larry Denton, Chairman and Chief Executive Officer of DURA Automotive Systems, said. "Though weak credit markets delayed the emergence process during the fourth quarter of 2007, we have worked productively with our creditors to develop a revised Plan that places the company on an even firmer footing by reducing the amount of required exit financing." The Plan filed is a revision of the previous version of DURA's Plan, filed on Aug. 22, 2007. The Plan is supported by DURA's key creditor constituencies. Although certain supporting documentation continues to be refined, the Official Committee of Unsecured Creditors and the Ad Hoc Committee of Certain Second Lienholders have agreed in principle to support the Plan. The Plan provides, among other things, details on how the company intends to treat more than $1.3 billion in claims, which takes into account changed economics. In light of these events, key terms of DURA'S revised Plan are: Second Lien Claims will receive approximately $225 million in new Convertible Preferred Stock Senior Notes and Other General Unsecured Claims will receive 100% of New Common Stock (without giving effect to the conversion of the Convertible Preferred Stock) Debtor-in-Possession claims, administrative expenses, and certain other priority claims will receive a full cash recovery Funding for the revised Plan will include a committed $80 million second lien loan facility, provided by certain of the company's creditors, in addition to a $150 million first lien term loan. Upon emergence, DURA expects to be a publicly reporting company under SEC rules. The company's pre-bankruptcy subordinated notes, convertible preferred securities and existing equity will not receive recoveries under the Plan. Within the next few days, DURA intends to file a revised Disclosure Statement, which will provide additional information about the Plan. DURA will request that the Court approve the adequacy of that Disclosure Statement at a hearing to be scheduled in early April, with a solicitation of creditor acceptances to follow shortly thereafter. DURA is advised by AlixPartners, Kirkland & Ellis and Miller Buckfire in connection with its Chapter 11 reorganization. Rochester Hills, Mich.-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The company has three locations in Asia -- China, Japan and Korea. It has locations in Europe and Latin-America, particularly in Mexico, Germany and the United Kingdom. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co-counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had $1,993,178,000 in total assets and $1,730,758,000 in total liabilities. The Debtors have asked the Court to extend their plan filing period to April 30, 2008. (Dura Automotive Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). DURA AUTOMOTIVE: Wants to Hire SRR as Valuation Consultant ---------------------------------------------------------- DURA Automotive Systems Inc. and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Stout Risius Ross, Inc., as valuation consultant, nunc pro tunc to Feb. 8, 2008. Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, relates that the Debtors have previously retained SRR as one of their ordinary course professional. As OCP, SRR has billed and received from the Debtors $36,942, as payment for fees and reimbursement of expenses for services it rendered from the Petition Date through Dec. 31, 2007, Mr. Madron tells the Court. However, the OCP Order has limited payment to OCPs at $25,000 per month on average over a rolling two-month period. Mr. Madron says the Debtors expect that SRR's fees in relation to the valuation and related consulting services for the Debtors will exceed the OCP Cap, thus the Debtors are seeking to employ SRR pursuant to Sections 327(a) and 328(a) so that the firm can be adequately compensated for their services. As valuation consultants, SRR will: * estimate the fair value of certain tangible and intangible assets, equity interests, and reporting units of the Debtors for fresh-start accounting purposes; * estimate the Fair Value of the Debtors' body and glass reporting unit and assets in support of their compliance with the Statement of Financial Accounting Standards No. 142, which addresses accounting and reporting of acquired goodwill and intangible assets; * provide an indication of the reproduction cost of the tangible assets for property insurance placement purposes; and * provide analysis with respect to the Debtors' assets as of the Petition Date. In exchange for the contemplated legal services, the Debtors will pay SRR based on the firm's applicable hourly rates: Professional Hourly Rate ------------ ----------- Managing Director $300 - $500 Director $255 - $300 Manager $200 - $225 Senior Analyst $150 - $200 Associate $100 - $150 Analyst $100 - $150 The Debtors estimate that professional services to be provided by SRR will total approximately $360,000. Mr. Madron says the fee estimate does not include any out-of-pocket expenses which will be billed at the actual amounts incurred. The Debtors have also agreed to provide SRR a $50,000 retainer, which retainer will be applied against SRR's final invoice. John N. Ross, Esq., a partner at SRR, assures the Court that his firm does not represent any interest adverse to the Debtors and their estates, and is a "disinterested person,"as the term is defined in Section 101(14). About DURA Rochester Hills, Michigan-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The company has three locations in Asia -- China, Japan and Korea. It has locations in Europe and Latin-America, particularly in Mexico, Germany and the United Kingdom. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co-counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had $1,993,178,000 in total assets and $1,730,758,000 in total liabilities. The Debtors have asked the Court to extend their plan filing period to April 30, 2008. (Dura Automotive Bankruptcy News, Issue No. 47; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). EMAC OWNER: Fitch Cuts Ratings to CC from CCC on Three Classes -------------------------------------------------------------- Fitch Ratings has taken rating actions on the outstanding classes for these issues of EMAC Owner Trusts: Series 1998-1 -- Class A-3 remains at 'CC/DR2'; -- Class IO remains at 'CC'; -- Classes B, C, D, E, and PI remain at 'C/DR6'. Series 1999-1 -- Class A-1 downgraded to 'CC/DR3' from 'CCC/DR2'; -- Class A-2 downgraded to 'CC/DR4' from 'CCC/DR3'; -- Class IO downgraded to 'CC' from 'CCC'; -- Classes B, C, D, E, F, and G remain at 'C/DR6'. Series 2000-1 -- Classes A-1 and A-2 remain at 'CCC/DR3'; -- Class IO remains at 'CCC'; -- Classes B, C, D, E, and F remain at 'C/DR6'. Fitch's analysis incorporated anticipated losses on defaulted and specially serviced collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral-specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, recovery prospects were found to have decreased since the last review for EMAC Owner Trust 1999-1 resulting in negative rating actions. Series 1998-1 and 2000-1 were found to have credit support consistent with Fitch's previous review resulting in the current ratings being maintained. FALCON FRANCHISE: Fitch Affirms Low-B Ratings on Six Loan Classes ----------------------------------------------------------------- Fitch Ratings has affirmed four Falcon Franchise Loan Transactions as listed below: Falcon Franchise Loan Trust certificates, series 1999-1: -- Class IO affirmed at 'AAA'; -- Class A-2 affirmed at 'AAA'; -- Class B affirmed at 'AA'; -- Class C affirmed at 'A'; -- Class D affirmed at 'BBB'; -- Class E affirmed at 'BB'. Falcon Franchise Loan Trust certificates, series 2000-1: -- Class IO affirmed at 'AAA'; -- Class A-1 affirmed at 'AAA'; -- Class A-2 affirmed at 'AAA'; -- Class B affirmed at 'AA-'; -- Class C affirmed at 'A-'; -- Class D affirmed at 'BBB-'; -- Class E affirmed at 'BB-'. Falcon Auto Dealership LLC, series 2001-1: -- Class IO affirmed at 'AAA'; -- Class A-1 affirmed at 'AAA'; -- Class A-2 affirmed at 'AA+'; -- Class B affirmed at 'A+'; -- Class C affirmed at 'BBB+'; -- Class D affirmed at 'B+'; -- Class E affirmed at 'B/DR1'; -- Class F remains at 'CCC/DR4'. Falcon Auto Dealership LLC, series 2003-1: -- Class IO affirmed at 'AAA'; -- Class A-1 affirmed at 'AAA'; -- Class A-2 affirmed at 'AAA'; -- Class B affirmed at 'A'; -- Class C affirmed at 'BBB-'; -- Class D affirmed at 'BB-'; -- Class E affirmed at 'B+'; -- Class F remains at 'CCC/DR5'. Fitch's analysis incorporated anticipated losses on defaulted collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral- specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, credit support was found to be consistent with Fitch's previous review resulting in the affirmation of the current ratings. FEDERAL-MOGUL: Inks New Stock Option Pact with CEO Jose Alapont --------------------------------------------------------------- Subject to the approval of its shareholders, Federal-Mogul Corp. and its debtor-affiliates entered into a new Stock Option Agreement with Jose Maria Alapont, its president and chief executive officer, on Feb. 15, 2008. On Dec. 27, 2007, the Debtors entered into a President and CEO Stock Option Agreement with Mr. Alapont. On Feb. 15, 2008, the Old Stock Option Agreement and the Old Stock Option Agreement Amendment were canceled by mutual written agreement of the company and Mr. Alapont, Federal-Mogul Corp. senior vice president Robert L. Katz reports in a regulatory filing with the U.S. Securities and Exchange Commission. The New President and CEO Stock Option Agreement grants Mr. Alapont a non-transferable, non-qualified option to purchase up to 4,000,000 shares of the company's Class A Common Stock subject to certain terms and conditions. The exercise price for the Option is $19.50 per share, which is at least equal to the fair market value of a share of the company's Class A Common Stock on the date of grant of the Option, according to Mr. Katz. The Option will expire on Dec. 27, 2014. The New President and CEO Stock Option Agreement also provides for vesting. Specifically, 40% of the shares of Class A Common Stock subject to the Option are vested, and an additional 20% of the shares of Class A Common Stock subject to the Option will vest on each of March 23, 2008; March 23, 2009; and March 23, 2010. If prior to March 23, 2010, Mr. Alapont's employment with the company (1) terminates by reason of death or disability, (2) is terminated by the company without cause, or (3) is terminated by Mr. Alapont for good reason, the Option will be exercisable with respect to all of the shares of Class A Common Stock subject to the Option on the date of Mr. Alapont's termination of employment. Mr. Alapont or his legal representative may thereafter exercise the Option until and including the earlier of (i) the date which is 90 days after the Employment Termination Date, and (ii) the Expiration Date. If Mr. Alapont's employment with the company terminates for any other reason, the Option will be exercisable only to the extent it is exercisable on Mr. Alapont's Employment Termination Date and may thereafter be exercised by Mr. Alapont or his legal representative until and including the earlier of (i) the date which is 90 days after the Employment Termination Date, and (ii) the Expiration Date. If the company's shareholders do not approve the grant of the Option pursuant to the New President and CEO Stock Option Agreement before Dec. 31, 2008, then (a) the Option will not become exercisable with respect to any shares of Class A Common Stock subject to the Option, and (b) the Option and the New President and CEO Stock Option Agreement will terminate on Dec. 31, 2008. The Option only will become exercisable with respect to any shares of Class A Common Stock subject to the Option after the approval of the Option by the company's shareholders, Mr. Katz clarifies. A full-text copy of the New President and CEO Stock Option Agreement is available for free at the SEC: http://ResearchArchives.com/t/s?28e2 About Federal-Mogul Federal-Mogul Corporation -- http://www.federal-mogul.com/-- (OTCBB: FDMLQ) is a global supplier, serving the world's foremost original equipment manufacturers of automotive, light commercial, heavy-duty, agricultural, marine, rail, off-road and industrial vehicles, as well as the worldwide aftermarket. Founded in Detroit in 1899, the company is headquartered in Southfield, Michigan, and employs 45,000 people in 35 countries. Aside from the U.S., Federal-Mogul also has operations in other locations which includes, among others, Mexico, Malaysia, Australia, China, India, Japan, Korea, and Thailand. The Company filed for chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl & Jones, P.C., represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $10.15 billion in assets and $8.86 billion in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard Firm represent the Official Committee of Unsecured Creditors. On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan. They submitted a Disclosure Statement explaining that plan on April 21, 2003. They submitted several amendments and on June 6, 2004, the Bankruptcy Court approved the Third Amended Disclosure Statement for their Third Amended Plan. On July 28, 2004, the District Court approved the Disclosure Statement. The estimation hearing began on June 14, 2005. The Debtors submitted a Fourth Amended Plan and Disclosure Statement on Nov. 21, 2006, and the Bankruptcy Court approved that Disclosure Statement on Feb. 6, 2007. The Fourth Amended Plan was confirmed by the Bankruptcy Court on Nov. 8, 2007, and affirmed by the District Court on Nov. 14. * * * As reported in the Troubled Company Reporter on Jan. 10, 2008, Moody's Investors Service confirmed the ratings of the reorganized Federal-Mogul Corporation -- Corporate Family Rating, Ba3; Probability of Default Rating, Ba3; and senior secured bank credit facilities, Ba2. The outlook is stable. The financing for the company's emergence from Chapter 11 bankruptcy protection has been funded in line with the structure originally rated by Moody's in a press release dated Nov. 28, 2007. As reported in the Troubled Company Reporter on Jan. 7, 2008, Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to Southfield, Michigan-based Federal-Mogul Corp. following the company's emergence from Chapter 11 on Dec. 27, 2007. The outlook is stable. FIELDSTONE MORTGAGE: Committee Wants to Hire Arent Fox as Counsel ----------------------------------------------------------------- The Official Committee of Unsecured Creditors of Fieldstone Mortgage Co. asks the United States Bankruptcy Court for the District of Maryland for authority to employ Arent Fox, LLP as attorneys nunc pro tunc to February 13, 2008. The firm is expected to: a. assist, advise and represent the Committee in its consultation with the Debtor relative to the administration of this Chapter 11 case; b. assist, advise and represent the Committee in analyzing the Debtor's assets and liabilities, investigating the extent and validity of liens and participating in and reviewing any proposed asset sales or dispositions; c. attend meetings and negotiate with the representatives of the Debtor and secured creditors; d. to assist and advise the Committee in its examination and analysis of the conduct of the Debtor's affairs; e. to assist the Committee in the review, analysis and negotiation of any plan of reorganization that may be filed and to assist the Committee in the review, analysis and negotiation of the disclosure statement accompanying any plan of reorganization; f. to assist the Committee in the review, analysis, and negotiation of any financing or funding agreements; g. to take all necessary actions to protect and preserve the interests of the Committee, including, without limitation, the prosecution of actions on its behalf, negotiations concerning all litigation in which the Debtor is involved, and review and analysis of all claims filed against the Debtor's estate; h. to generally prepare on behalf of the Committee all necessary motions, applications, answers, orders, reports and papers in support of positions taken by the Committee; i. to appear, as appropriate, before this Court, the Appellate Courts, and other Courts in which matters may be heard and to protect the interests of the Committee before said Courts and the United States Trustee; and j. to perform all other necessary legal services in this case. The Committee will pay the firm an its standard hourly rates.: Designation Rate ----------- ---- Partner US$410-US$710 Counsel US$410-US$675 Associates US$260-US$465 Paraprofessionals US$130-US$235 The Committee believes that the employment of the firm is necessary and in the best interest of its estates. To the best of the Committee's knowledge, the firm does not have any adverse interest in the Committee's estates. The firm can be reached at: Christopher J. Giaimo, Jr., Esq. (giaimo.christopher@arentfox.com) 1050 Connecticut Avenue, Northwest Washington, DC 20036 Tel: (202) 857-6000 Fax: (202) 857-6395 http://www.arentfox.com/ About Fieldstone Mortgage Headquartered in Columbia, Maryland, Fieldstone Mortgage Co.-- http://www.fieldstonemortgage.com/--is a direct lender that offers mortgage loans for multiple credit situations in the United States. In September 2007, Fieldstone was the target of a lawsuit by Morgan Stanley over 72 mortgages worth $26.5 million that had no, or late, payments. The company filed for chapter 11 bankruptcy on Nov. 23, 2007 (Bankr. D. Md. Case No. 07-21814) citing loan payment lapses and credit market woes. Joel I. Sher, Esq., at Shapiro, Sher, Guinot & Sandler represents the Debtor in its restructuring efforts. The U.S. Trustee for Region 4 has yet to appoint creditors to serve on an Official Committee of Unsecured Creditors in this case. As reported in the Troubled Company Reporter on Feb. 5, 2008, it listed total assets of $14,465,348 and total debts $121,342,790. As reported in the Troubled Company Reporter on Dec. 19, 2007 the Debtor obtained up to $3.8 million in postpetition financing from Credit-Based Asset Servicing and Securitization LLC. FIELDSTONE MORTGAGE: U.S. Trustee Forms 3-Member Creditors Panel ---------------------------------------------------------------- Katherine A. Levin, the U.S. Trustee for Region 4, appoints three members to the Official Committee of Unsecured Creditors in the Chapter 11 cases of Fieldstone Mortgage Co. The Creditors Committee members are: a)HSBC Consumer & Mortgage Lending Francis Pinckney, Managing Director (francis.m.pinckney.iii@us.hsbc.com) 3023 HSBC Way Fort Mill, SC 29715 Tel: (803) 835-6008 Fax: (803) 835-6018 b)Mr. Harvey Goldberg Attention: Steven D. Sass, Esq. (steven.sass@rmsna.com) RMS 307 International Circle, Suite 270 Hunt Valley, MD 21030 Tel: (410) 773-4040 Fax: (410) 773-4057 c)Verizon Business Scott Danford, Supervisor (scott.a.danford.@verizonbusiness.com) Customer Financial Services 6415 Business Center Drive Highlands Reach, CO 80130 Tel: (303) 305-1729 Fax: (866) 836-1256 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. About Fieldstone Mortgage Headquartered in Columbia, Maryland, Fieldstone Mortgage Co. -- http://www.fieldstonemortgage.com/-- is a direct lender that offers mortgage loans for multiple credit situations in the United States. In September 2007, Fieldstone was the target of a lawsuit by Morgan Stanley over 72 mortgages worth $26.5 million that had no, or late, payments. The company filed for chapter 11 bankruptcy on Nov. 23, 2007 (Bankr. D. Md. Case No. 07-21814) citing loan payment lapses and credit market woes. Joel I. Sher, Esq., at Shapiro, Sher, Guinot & Sandler represents the Debtor in its restructuring efforts. The U.S. Trustee for Region 4 has yet to appoint creditors to serve on an Official Committee of Unsecured Creditors in this case. As reported in the Troubled Company Reporter on Feb. 5, 2008, it listed total assets of $14,465,348 and total debts $121,342,790. As reported in the Troubled Company Reporter on Dec. 19, 2007 the Debtor obtained up to $3.8 million in postpetition financing from Credit-Based Asset Servicing and Securitization LLC. FFCA SECURED: Fitch Takes Rating Actions on Various Classes ----------------------------------------------------------- Fitch Ratings has taken these rating actions on theee FFCA Secured Franchise Loan Trusts: FFCA series 1997-1: -- Class B-2 affirmed at 'AA'; -- Class C-2 affirmed at 'A'' -- Class D-2 affirmed at 'BBB'; -- Class E-2 affirmed at 'BBB-'; FFCA series 1998-1: -- Class B-1 affirmed at 'AA'; -- Class C-1 affirmed at 'A'; -- Class D-1 affirmed at 'BB'; -- Class I-O affirmed at 'AAA'. FFCA series 1999-1: -- Class A1-b affirmed at 'AAA'; -- Class A-2 affirmed at 'AAA'; -- Class B-1 affirmed at 'A'; -- Class B-2 affirmed at 'A'; -- Class C-1 affirmed at 'BBB'; -- Class C-2 affirmed at 'BBB'; -- Class D-1 affirmed at 'BBB-'; -- Class D-2 affirmed at 'BBB-'; -- Class I-O affirmed at 'AAA'. FFCA series 1999-2: -- Class A-1c currently rated 'AAA' remains on Rating Watch Negative; -- Class A-2 downgraded to 'CC/DR4' from 'CCC/DR3'; -- Class B-1 remains at 'CC/DR2'; -- Class B-2 remains at 'C/DR6'; -- Class C-1 remains at 'C/DR6'; -- Class C-2 remains at 'C/DR6'; -- Class D-1 remains at 'C/DR6'; -- Class D-2 remains at 'C/DR6'; -- Class E-1 remains at 'C/DR6'; -- Class E-2 remains at 'C/DR6'; -- Class I-O affirmed at 'BBB'. Class A-1c rating is based on the strength of an MBIA insurance policy. FFCA series 2000-1: -- Class A-2 currently rated 'AAA' remains on Rating Watch Negative; -- Class B affirmed at 'B/DR1'; -- Class C affirmed at 'CCC/DR1'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class I-O affirmed at 'BBB'. Class A-2 rating is based on the strength of an MBIA insurance policy. Fitch's analysis incorporated anticipated losses on defaulted collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral- specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. With the exception of 1999-2, Fitch rated FFCA transactions were found to have credit support consistent with Fitch's previous review leading to the affirmation of the current ratings. Recovery expectations on defaulted collateral in series 1999-2 have slightly declined since the last review. This decline is reflected in the rating downgrade and lowering of the distressed recovery rating for the class A-2 certificates. FMAC LOAN: Fitch Retains Junk Ratings on 43 Classes --------------------------------------------------- Fitch has affirmed the ratings of nine FMAC Loan Receivables Trusts as: Series 1996-A: -- Class A-1 IO affirmed at 'AAA'; -- Class A-2 IO affirmed at 'AAA'; -- Class A-1 currently rated 'AAA' remains on Rating Watch Negative; -- Class A-2 currently rated 'AAA' remains on Rating Watch Negative; -- Class B-1 remains at 'C/DR6'; -- Class B-2 remains at 'C/DR6'; -- Class C-1 remains at 'C/DR6'; -- Class C-2 remains at 'C/DR6'. Note: Ratings for classes A-1 and A-2 are based on the strength of an MBIA insurance policy. Series 1996-B: -- Class A-X remains at 'C'; -- Class A-1 remains at 'C/DR1'; -- Class A-2 remains at 'C/DR3'; -- Class B remains at 'C/DR6'; -- Class C remains at 'C/DR6'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'. Series 1997-A: -- Class A-X affirmed at 'AA'; -- Class B affirmed at 'A'; -- Class C affirmed at 'BB'; -- Class D remains at 'C/DR2' -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'. Series 1997-B: -- Class A-X affirmed at 'B'; -- Class A affirmed at 'B/DR1'; -- Class B remains at 'C/DR3'; -- Class C remains at 'C/DR6'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'. Series 1997-C: -- Class A-X affirmed at 'BBB'; -- Class B remains at 'C/DR1'; -- Class C remains at 'C'; DR revised to 'DR6' from 'DR3'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'; Series 1998-A: -- Class A-X remains at 'C'; -- Class A-2 remains at 'C/DR2'; -- Class A-3 remains 'C/DR2'; -- Class B remains at 'C/DR6'; -- Class C remains at 'C/DR6'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'; Series 1998-B: -- Class A-X remains at 'C'; -- Class A-2 remains at 'C/DR1'; -- Class B remains at 'C/DR6'; -- Class C remains at 'C/DR6'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'; Series 1998-C: -- Class A-X affirmed at 'BB'; -- Class A-2 affirmed at 'BB'; -- Class A-3 affirmed at 'BB'; -- Class B affirmed at 'B-/DR1'; -- Class C remains at 'C/DR6'; -- Class D remains at 'C/DR6'; -- Class E remains at 'C/DR6'; -- Class F remains at 'C/DR6'. Series 1998-D: -- Class A-3 affirmed at 'AAA'. Note: Class A-3 is affirmed based on the strength of an FSA insurance policy. Fitch's analysis incorporated anticipated losses on defaulted collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral- specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, Fitch-rated FMAC transactions were found to have credit support consistent with Fitch's previous review leading to the affirmation of the current ratings. Recovery expectations on defaulted collateral in series 1997-C have slightly declined since last review. This decline is reflected in the negative migration of the distressed recovery rating for the class C notes in the 1997-C series. FORD MOTOR: To Give Out Performance Bonuses to All Employees ------------------------------------------------------------ Ford Motor Co. will dole out performance bonuses to all its hourly and salaried employees in North America despite incurring a $2.7 billion loss in 2007, various sources report citing Ford CEO Allan Mulally. Hourly workers will get a lump sum payment of $1,000 beginning March 13, while salaried employees' perk will be based on payment grade and leadership level, The Wall Street Journal reports. The move was instigated to boost morale amid a difficult turnaround. While Ford didn't meet profit and market share goals for 2007, it did improve its cost performance, quality, automotive cash flow and financial results, Mr. Mulally said in the e-mail message cited by WSJ's source. As reported in the Troubled Company Reporter on March 9, 2007, Ford Motor paid hourly and salaried employees a bonus of between $300 and $800. In addition, Tom Krisher of The Associated Press relates that Ford will defer salaried worker merit increases to July 1 from April 1 for the company to attain cost objectives. Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Feb. 15, 2008, Fitch Ratings affirmed the Issuer Default Ratings of Ford Motor Company and Ford Motor Credit Company at 'B', and maintained the Rating Outlook at Negative. As reported in the TCR on Nov. 19, 2007, Moody's Investors Service affirmed the long-term ratings of Ford Motor Company (B3 Corporate Family Rating, Ba3 senior secured, Caa1 senior unsecured, and B3 probability of default), but changed the rating outlook to Stable from Negative and raised the company's Speculative Grade Liquidity rating to SGL-1 from SGL-3. Moody's also affirmed Ford Motor Credit Company's B1 senior unsecured rating, and changed the outlook to Stable from Negative. These rating actions follow Ford's announcement of the details of the newly ratified four-year labor agreement with the UAW. FORD MOTOR: Luxury Brands Buyer Says Won't Flip Jaguar ------------------------------------------------------ Ford Motor Co. luxury brands buyer Tata Motors Ltd. denies speculations that it may sell Jaguar after closing the acquisition deal, Mike Spector and Edward Taylor of The Wall Street Journal report. Tata Group Chairman Ratan Tata said that Tata Motors Ltd. won't flip Jaguar, and further assured workers at Ford's Jaguar and Land Rover luxury brands that the company won't introduce drastic changes to the brands' business structure. "These are two iconic brands . . . the plan would be to retain the image and not to tamper it in any way,"Reuters quoted a Tata spokesperson as telling reporters at the Geneva auto show on Tuesday. According to the unnamed spokesperson, Tata intends to "nurture and grow"the brands. A Financial Times report on Wednesday said that Mr. Tata expects Jaguar and Land Rover's management to integrate with Tata Motors,' but he promises they would not get involved with "Indianising"the company. Tata Motors became the front-runner to buy Ford's Jaguar and Land Rover, outbidding Mahindra & Mahindra in collaboration with buyout firm Apollo; and One Equity Partners LLC. Deal Delayed As reported in the Troubled Company Reporter on Feb 26, 2008, the announcement of the sale of the two luxury brands to Tata Motors is expected to be out on March 6 or 7. WSJ, citing an unnamed person briefed on the negotiations, said talks were likely to extend beyond this week. According to the Indo-Asian News Service, the purchase has been delayed by more than 10 days. "We have been told that the memorandum of sales will now take place in the week beginning March 17, after the Geneva Motor Show is over,"IANS quotes a spokesman for Unite workers' as saying. Ford noted in its U.S. Securities and Exchange Commission annual report filing that the sale deal with Tata Motors for the two units is expected to close in the second quarter. About Tata Motors India's largest automobile company, Tata Motors Limited -- http://www.tatamotors.com/-- is mainly engaged in the business of automobile products consisting of all types of commercial and passenger vehicles, including financing of the vehicles sold by the Company. The Company's operating segments consists of Automotive and Others. In addition to its automotive products, it offers construction equipment, engineering solutions and software operations. Tata Motors has operations in Russia and the United Kingdom. About Ford Motor Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Feb. 15, 2008, Fitch Ratings affirmed the Issuer Default Ratings of Ford Motor Company and Ford Motor Credit Company at 'B', and maintained the Rating Outlook at Negative. As reported in the Troubled Company Reporter on Nov. 19, 2007, Moody's Investors Service affirmed the long-term ratings of Ford Motor Company (B3 Corporate Family Rating, Ba3 senior secured, Caa1 senior unsecured, and B3 probability of default), but changed the rating outlook to Stable from Negative and raised the company's Speculative Grade Liquidity rating to SGL-1 from SGL-3. Moody's also affirmed Ford Motor Credit Company's B1 senior unsecured rating, and changed the outlook to Stable from Negative. These rating actions follow Ford's announcement of the details of the newly ratified four-year labor agreement with the UAW. FORTUNOFF: Three Creditors Want Their Goods Returned ---------------------------------------------------- Three creditors of Fortunoff Fine Jewelry and Silverware LLC and its debtor-affiliates demand the return of their goods: Creditors Amount of Goods --------- --------------- Precision Enterprises, Inc. $148,795 Rona K. Corp. 1,780 Vera Bradley 100,593 The parties assert that they are entitled to reclamation of their products delivered to the Debtors pursuant to Uniform Commercial Code Section 2-702 and Section 546(c) of the Bankruptcy Code. 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. In their schedules, Fortunoff Fine Jewelry listed $5,052,315 total assets and $136,626,948 total liabilities; Source Financing Corp. listed $154,680,100 total assets and $176,961,631 total liabilities; and M. Fortunoff of Westbury LLC listed $6,300,955 total assets and $119,985,788 total liabilities. The Debtors' exclusive period to file a plan of reorganization ends on June 3, 2008. (Fortunoff Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FORTUNOFF: Obtains Permission to Pay Existing Insurance Policies ---------------------------------------------------------------- Judge James M. Peck of the U.S. Bankruptcy Court for the Southern District of New York, on a final basis, authorized, in their discretion, Fortunoff Fine Jewelry and Silverware LLC and its debtor-affiliates to: -- maintain their existing insurance policies and pay all related premiums and brokers' fees; and -- continue their insurance premium financing programs and pay all related obligations. Debtors May Pay Monthly Fees to AFCO Judge Peck also permitted the Debtors to perform under and make their regular monthly installment payments under a financing agreement with AFCO Premium Credit LLC, and its assignee AFCO Credit Corporation, as they become due in the ordinary course of business. In the event that the Debtors default upon any of the terms of the Financing Agreement, other than representations of solvency, AFCO may exercise its rights as it may otherwise have under state law, but for the pendency of the Debtors' Chapter 11 cases and, without the necessity of further application to the Court, cancel all insurance policies listed on the Financing Agreement, and receive and apply all unearned insurance premiums to the account of the Debtors, Judge Peck ordered. However, if AFCO seeks to terminate any financed polices, in addition to any notice requirements under the Financing Agreement and state law, it will give the Debtors 10 days notice from the date of mailing of its intent to terminate the policies. Interim Approval Obtained Judge Peck granted the Debtors' request on an interim basis to continue their Insurance Policies and to pay the premiums and related charges arising under or in connection with the Insurance Polices as premiums and charges become due, among others. According to Sally McDonald Henry, Esq., at Skadden Arps Slate Meagher & Flom LLP, in New York, the Debtors maintain various insurance policies, which include workers' compensation claims, automobile claims and jewelers block claims. Ms. Henry noted that the third-party claims that are covered by the Insurance Policies are neither unusual in amount or number, in relation to the extent of the business operations conducted by the Debtors. Ms. Henry told the Court that maintaining the Debtors' insurance policies is essential to the continued operation of the Debtors' businesses and is required under the United States Trustee's Operating Guidelines for Chapter 11 Cases. Ms. Henry told the Court that the Debtors' insurance premiums are financed under a commercial premium finance agreement. The total premiums under the policies subject to the Financing Agreement with AFCO is $1,160,256. Ms. Henry said that the Debtors made a down payment of $464,102 and, after assessment of a $15,373 finance charge, financed a total of $696,154. The Financing Agreement requires seven monthly payments to AFCO, each for $101,646, with the first installment due on Feb. 29, 2008, Ms. Henry informed the Court. She noted that as of the bankruptcy filing, the Debtors have not made any monthly installment payments. 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. In their schedules, Fortunoff Fine Jewelry listed $5,052,315 total assets and $136,626,948 total liabilities; Source Financing Corp. listed $154,680,100 total assets and $176,961,631 total liabilities; and M. Fortunoff of Westbury LLC listed $6,300,955 total assets and $119,985,788 total liabilities. The Debtors' exclusive period to file a plan of reorganization ends on June 3, 2008. (Fortunoff Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) FORTUNOFF: Court Bars Utility Providers From Refusing Service ------------------------------------------------------------- On a final basis, Judge James M. Peck of the U.S. Bankruptcy Court for the Southern District of New York ruled that utility providers of Fortunoff Fine Jewelry and Silverware LLC and its debtor- affiliates are: (i) forbidden and prohibited from discontinuing, altering, or refusing service to, or discriminating against, the Debtors on account of unpaid charges for prepetition services or the Debtors' bankruptcy filing, and (ii) deemed to have received adequate assurance of payment in compliance with Section 366. Any utility provider who requested and accepted an adequate assurance deposit is deemed to have (a) stipulated that the Adequate Assurance Deposit constitutes adequate assurance of future payment to the Utility Provider, and (b) waived any right to seek additional adequate assurance during the course of the Debtors' Chapter 11 proceedings. The Debtors may, in their discretion, resolve any Adequate Assurance Request by mutual agreement with the Utility Provider without further order of the Court, the Court maintained. The Debtors' Adequate Assurance Procedures are also approved on a final basis. Injunction Against Utility Providers More than 250 utility companies provide the Debtors with critical products and services in connection with the operation of their businesses like water, natural gas, electricity, and telephone. Sally McDonald Henry, Esq., at Skadden Arps Slate Meagher & Flom LLP, in New York, the Debtors' former counsel, relates that if the Utility Companies refuse or discontinue service, even for a brief period, the Debtors' operations would be severely disrupted. Accordingly, the Debtors ask the Court to: (i) prohibit utilities from altering, refusing, or discontinuing service to, or discriminating against, them; (ii) establish procedures for determining adequate assurance of payment; and (iii) establish procedures for utilities to opt out of the Debtors' proposed procedures for adequate assurance. According to Ms. Henry, the Debtors intend to pay all postpetition obligations owed to the Utility Companies in a timely manner. She says that the Debtors' borrowings under their proposed postpetition credit facility will be sufficient to pay postpetition utility obligations. KeySpan's Objections to be Heard on March 26 Judge Peck will convene a hearing on March 26, 2008, to address objections filed by KeySpan Gas East Corporation d/b/a Keyspan Energy Delivery Long Island, Long Island Lighting Company d/b/a LIPA, and Public Service Electric and Gas Company. KeySpan, et al., object to the Debtors' proposed adequate assurance payment of two weeks' worth of utility consumption, which payments were approved by Judge Peck on an interim basis. Under the Utility Companies' billing cycles, the Debtors receive one month of utility service before the Utility Companies issue a bill. Once a bill is issued, the Debtors have 15 to 30 days to pay. If the Debtors fail to timely pay the bill, a past due notice is issued and a late fee is subsequently imposed on the account, Utility Providers' counsel, Thomas R. Slome, Esq., at Rosen Slome Marder LLP, in New York notes. In the event that the Debtors fail to pay the bill after the issuance of the past due notice, the Utility Company will ask the Debtors to cure the arrearage within a certain period of time, or its service will be disconnected. Under the Billing Cycles, the Debtors could receive two to three months of unpaid service before their utilities are terminated due to a postpetition payment default. The Utility Providers estimated the prepetition debts owed by the Debtors as: Estimated No. of Prepetition Deposit Utility Accts. Debt Request ------- ------ ----------- ------- PSE&G 7 $65,512 $62,295 (2 months) LIPA 9 53,083 63,595 (2 months) KEDLI 7 12,380 14,175 (2 months) 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. In their schedules, Fortunoff Fine Jewelry listed $5,052,315 total assets and $136,626,948 total liabilities; Source Financing Corp. listed $154,680,100 total assets and $176,961,631 total liabilities; and M. Fortunoff of Westbury LLC listed $6,300,955 total assets and $119,985,788 total liabilities. The Debtors' exclusive period to file a plan of reorganization ends on June 3, 2008. (Fortunoff Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) GEA SEASIDE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: GEA Seaside Investments, Inc. dba Daytona Beach Property Management dba Daytona Beachside Property Management fdba GEA Investments, Inc. 434 North Halifax Avenue, Suite 2 Daytona Beach, FL 32118 Bankruptcy Case No.: 08-01693 Type of Business: The Debtor is a real estate developer. Chapter 11 Petition Date: March 6, 2008 Court: Middle District of Florida (Orlando) Debtor's Counsel: Elizabeth A. Green, Esq. (bankruptcynotice@lseblaw.com) Latham, Shuker, Eden & Beaudine, LLP 390 North Orange Avenue, Suite 600 Orlando, FL 32801 Fax: (407) 481-5801 Tel: (407) 481-5800 Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor does not have any creditors who are not insiders. GENERAL MOTORS: Restores CEO's Pay to 2003 Level of $2.2 Million ---------------------------------------------------------------- General Motors Corp. restored the salary of G. Richard Wagoner, Jr., its chairman and chief executive officer, to 2003 level of $2,200,000. His 2008 Annual Incentive Plan target will be $3,520,000 and long-term incentive opportunity under the 2008-2010 Stock Performance Plan will be a grant of 165,563 shares of GM Common Stock. In addition, Mr. Wagoner will receive 500,000 stock options and 75,000 restricted stock units. The stock options will vest ratably over a three-year period. The restricted stock units will vest 1/3 in year three, 2011, with the remaining 2/3 vesting through year five. Grants of performance contingent stock options were approved for Messrs. Wagoner and Frederick Henderson, president and chief operating officer, in amounts of 500,000 shares and 200,000 shares, respectively. These options were granted at $23.13 on the date of grant, March 5, 2008, and will vest following the first anniversary date of the grant if the price of GM common stock reaches $40.00, or 173% of the grant price, prior to March 5, 2013, and this price is maintained for a ten day period within 30 consecutive trading days. Vested performance options may be exercised through March 5, 2015, a seven year term. Net shares acquired upon exercise must be held for at least a two year period while the executive is actively employed. Shares acquired upon exercise after retirement are not subject to this holding requirement. Options that do not vest before March 5, 2013 will be forfeited. Newly Appointed Officers and Their Pay As reported in the Troubled Company Reporter on March 4, 2008, GM board of directors appointed these officers effective immediately, at its meeting on March 3: * Frederick (Fritz) A. Henderson, 49, vice chairman and chief financial officer, is elected president and chief operating officer; * Ray Young, 46, currently group vice president - finance, is elected executive vice president and chief financial officer, replacing Mr. Henderson; and * Thomas G. Stephens, 59, currently group vice president, global powertrain and global quality, is also elected executive vice president. As president and COO, Mr. Henderson's base salary will be $1,800,000. His 2008 annual incentive plan target will be $2,430,000 and long-term incentive opportunity under the 2008 -- 2010 stock performance plan will be a grant of 110,376 shares of GM common stock. In addition, he will receive 250,000 stock options and 60,000 restricted stock units. The stock options will vest ratably over a three year period. The restricted stock units will vest 1/3 in year three, 2011, with the remaining 2/3 vesting through year five. Mr. Henderson's brother, Douglas L. Henderson, is a non-executive employee of the company, with annual compensation of less than $200,000. Other than that relationship, there is no reportable relationship between the company or its affiliates and Mr. Henderson. As CFO, Mr. Young's base salary will be $900,000. His 2008 annual incentive plan target will be $945,000 and long-term incentive opportunity under the 2008-2010 stock performance plan will be a grant of 16,557 shares of GM common stock. In addition, he will receive 87,500 stock options and 30,354 cash-based restricted stock units. The stock options will vest ratably over a three year period. The cash-based restricted stock units will vest ratably over a three year period. Exec Bonuses a Sensitive Issue for UAW Reuters and The Wall Street Journal ran separate reports citing that bonuses and compensation awarded to executives at GM are delicate matters for the United Auto Workers union. Both reports noted UAW president Ron Gettelfinger's move to question the large amounts of money that company executives get amid the company's losses. GM spokesman, Renee Rashid-Merem, explained that a large amount of the compensation afforded to the executives was dependent on the financial performance of the company, Reuters said. Analysts complimented GM's efforts of reducing its fixed costs by $9 billion and of reaching an agreement with the UAW, which is projected to result in yearly savings of $500 million for GM, Reuters added. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on Feb. 28, 2008, Fitch Ratings 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 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 a new labor contract. The outlook is stable. GENERAL MOTORS: Closes Wentzville Plant Over Axle Workers' Strike ----------------------------------------------------------------- General Motors Corp. on Thursday ceased operations at another plant -- GM's Wentzville, Missouri facility -- over the continuing strike at its supplier, American Axle & Manufacturing Inc., according to various reports. The strike at American Axle is already at its two-week stretch and no agreement has been reached as of press time. American Axle indicated on its Web site that it will resume contract negotiations with the United Auto Workers union at noon on Thursday, March 6, 2008. No further details on the American Axle- UAW negotiation was provided. GM has about 20 facilities affected by the strike at American Axle as the supplier attempts to negotiate with the United Auto Workers. The Wentzville facility is one of the five additional facilities that GM intends to close, apart from the already closed six facilities. The other four facilities will be closed this week, reports relate. The Wentzville facility manufactures Chevrolet Express and GMC Savanna and has 2,000 workers. Around 20%, or more than 20,000, of GM's workers at its North American operations have been affected by the plant closures. Two Plants Idled Over Axle Dispute As reported in the Troubled Company Reporter on March 5, 2008, two additional production facilities in Moraine, Ohio, and Mishawaka, Indiana, have been affected by the labor dispute between the UAW and key supplier American Axle, according to a GM production statement. A Toledo Transmission plant is anticipated to be shutdown on March 10, 2008, and is expected 1,444 hourly and 219 salaried workers to be laid off. The TCR related on March 3, 2008, two more GM plants are likely to shutter this week as supplier American Axle continues to negotiate with UAW union workers on strike. 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 on February 28. A day after, GM production factories in Flint, Michigan, Fort Wayne, Indiana, and Oshawa, Ontario, were idled after the second shift, displacing a total of 9,503 hourly and salaried workers. UAW president Ron Gettelfinger and Vice President James Settles disclosed that members at American Axle began an unfair labor practices strike at on Feb. 26, 2008, following expiration of a four-year master labor agreement. About American Axle Headquartered in Detroit, Michigan, American Axle & Manufacturing Holdings Inc. (NYSE:AXL) -- http://www.aam.com/-- and its wholly owned subsidiary, American Axle & Manufacturing, Inc., manufactures, engineers, designs and validates driveline and drivetrain systems and related components and modules, chassis systems and metal-formed products for light trucks, sport utility vehicles and passenger cars. In addition to locations in the United States (in Michigan, New York and Ohio), the company also has offices or facilities in Brazil, China, Germany, India, Japan, Luxembourg, Mexico, Poland, South Korea and the United Kingdom. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on 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: 18 Plants to Lay Off Workers Due to Axle Strike --------------------------------------------------------------- General Motors Corp. disclosed that 18 North American manufacturing facilities will be partially or fully affected by an ongoing labor dispute between GM's key supplier American Axle and Manufacturing Inc. and the United Auto Workers union. Around 16,336 hourly workers and 2,476 salaried employees will be displaced, according to a GM production statement. Plants that are partially affected are those still producing parts for GM facilities not affected by the strike. These plants are: * South Engine plant in Flint, Michigan; * Engine/Components plant in St. Catharines, Ontario; * Transmission plant in Baltimore, Maryland; * Components plant in Bay City, Michigan; * Casting plant in Bedford, Ohio; * Casting plant in Defiance, Ohio; * Components plant in Fredericksburg, Virginia; * Components plant in Parma, Ohio; * Transmission plant in Willow Run, Michigan; * Transmission plant in Ypsilanti, Michigan; * Engine plant in Tonawanda, New York; * Stamping plant in Flint, Michigan; * Stamping plant in Grand Rapids, Michigan; * Stamping plant in Indianapolis, Indiana; * Stamping plant in Mansfield, Ohio; * Stamping plant in Marion, Indiana; and * Stamping plant in Parma, Ohio. An engine plant in Romulus, Michigan will be fully affected by the strike and will cease producing V6 and V8 engines on March 10, 2008. Two Plants Idled Over Axle Dispute As reported in the Troubled Company Reporter on March 5, 2008, two additional production facilities in Moraine, Ohio, and Mishawaka, Indiana, have been affected by the rally of Axle union members. A Toledo Transmission plant is anticipated to be shut down on March 10, 2008, and is expected to lay off 1,444 hourly and 219 salaried workers. UAW president Ron Gettelfinger and Vice President James Settles disclosed that members at American Axle began an unfair labor practices strike at on Feb. 26, 2008, following expiration of a four-year master labor agreement. About American Axle Headquartered in Detroit, Michigan, American Axle & Manufacturing Holdings Inc. (NYSE:AXL) -- http://www.aam.com/-- and its wholly owned subsidiary, American Axle & Manufacturing, Inc., manufactures, engineers, designs and validates driveline and drivetrain systems and related components and modules, chassis systems and metal-formed products for light trucks, sport utility vehicles and passenger cars. In addition to locations in the United States (in Michigan, New York and Ohio), the company also has offices or facilities in Brazil, China, Germany, India, Japan, Luxembourg, Mexico, Poland, South Korea and the United Kingdom. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on 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: Contracts Provide for Union Workers When Laid-Off ----------------------------------------------------------------- Tom Wickman, General Motor Corp.'s Global Manufacturing Communications Manager, disclosed that its labor contracts with the United Auto Workers union, the Canadian Auto Workers union and the International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers provide compensation for people on a short work week or regular layoff due to the impact of GM facilities on American Axle and Manufacturing Inc.'s workers union strike. In addition, plants listed as "partially impacted"are still producing parts for GM facilities not impacted by the strike. GM's practice, Mr. Wickham relates, is to notify its employees first when a particular plant will be affected by the protest. Once the employee notification occurs, the company provides basic information about the affected plant. Not all plants affected by the strike shuts down completely. Even though production stops, GM requires salaried employees to report to their jobs and may need to retain hourly employees to handle maintenance, sanitation or other work assignments. Some plants may have employees continue reporting to work for training purposes. These are reasons why the automaker is unable to release layoff figures -- numbers vary on a day-to-day basis. Mr. Wickham elaborates that with a handful of assembly plants idled by the strike, the company is experiencing some impact at its Powertrain and Stamping operations. Still, the layoffs are minor in scope as the plants continue to produce parts for other GM assembly plants that have not been impacted by the stike. Mr. Wickham says its still premature to confirm on the amount of production lost to date and GM's plans of recovery. 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. GEORGE FAISON: Case Summary & Seven Largest Unsecured Creditors --------------------------------------------------------------- Debtor: George nmn Faison, Faison, George 866 Abrego Monterey, CA 93940 Tel: (510) 581 7111 Bankruptcy Case No.: 08-51080 Chapter 11 Petition Date: March 6, 2008 Court: Northern District of California (San Jose) Debtor's Counsel: Robert C. Borris, Jr., Esq. (RBorrisjr@aol.com) 21550 Foothill Boulevard, 2nd Floor Hayward, CA 94541 Tel: (510) 581-7111 Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Debtor's Seven Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Bentley Financial Services $15,333 P.O. Box 60144 City of Industry CA 91716 The Herald $586 P.O. Box 271 Monterey CA 93942 California State Auto $142 Association, Attention: Far West Collection Services P.O. Box 937 Concrod CA 94522 United Postal Service, $126 Marina Coast Water District $93 The Retreat at Valley Hi $0 Association Executive Trustee Services, unknown LLC GLOBAL FRANCHISE: Fitch Holds 'BB' Rating on Class A-3 Trusts ------------------------------------------------------------- Fitch Ratings has affirmed the ratings of Global Franchise Trust 1998-1, as: -- Classes A-X and A-2 affirmed at 'BB+'; -- Class A-3 affirmed at 'BB'; -- Class B remains at 'CCC/DR3'; -- Classes C, D, and E remain at 'C/DR6'. Fitch's analysis incorporated anticipated losses on defaulted and specially serviced collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral-specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, credit support was found to be consistent with Fitch's previous review resulting in an affirmation of the current ratings. GOLDEN STATE: Taps Pinnacle as Bankruptcy Counsel ------------------------------------------------- Golden State Investments, LP seeks permission from the U.S. Bankruptcy Court for the Northern District of California, Oakland Division, to employ Pinnacle Law Group LLP, as its bankruptcy counsel. Golden State Investments said it needs Pinnacle Law Group to advise and represent it in its Chapter 11 case. The law firm's role will include: -- causing to be filed a voluntary case under Chapter 11 and preparing and filing all required and necessary pleadings; -- advising it on its duties and responsibilities as a Debtor- in-Possession; -- representing it at the meeting of creditors; -- negotiating with the creditors' committee, if one is appointed; -- drafting a plan and disclosure statement; and -- any other legal issues that may arise during the case. The Debtor notes that the bankruptcy attorneys at PLG have represented numerous chapter 11 debtors-in-possession. The Debtor assures the Court that the firm, its partners, employees, and attorneys do not hold or represent any interests adverse to the bankruptcy estate, are disinterested, have no connection with the Debtor, its creditors, any party-in-interest, their attorneys and accountants, the United States Trustee, or any person employed in the office of the United States Trustee. The firm' Matthew J. Shier and Jeremy W. Katz will be paid $495 per hour for their legal services. Other attorneys at PLG charge between $200 and $400 per hour. Paralegals charge $150 per hour. The Debtor has no funds with which to pay PLG. W.H. (Dutch) Zenklusen -- a limited partner of the Debtor and a guarantor of some of the Debtor's obligations -- has provided PLG with a $25,000 deposit for services rendered and to be rendered in the case, and $10,000 of the deposit is an "evergreen" retainer, which will be applied to the final invoice in the case. The Debtor will not pay any of PLG's fees and costs; however, PLG will invoice the Debtor on a monthly basis. If that changes, the Debtor will file supplemental pleadings explaining the changed circumstances. None of the deposit, nor any of the fund to be paid to PLG by Mr. Zenklusen, belong to, or came from, the Debtor, and the Debtor has no interest in the deposit or future payments made by Mr. Zenklusen to PLG. Mr. Zenklusen has waived any and all claims he may have against the Debtor. Pleasanton, California-based Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. filed separate voluntary chapter 11 petitions on February 14, 2008 before the U.S. Bankruptcy Court for the Northern District of California (Oakland) (Lead Case No.: 08-40689). Golden State Investments listed $23,400,266 in total pre- bankruptcy assets and $29,306,989 in total pre-bankruptcy debts. GOLDEN STATE: Files Schedules of Assets and Liabilities ------------------------------------------------------- Golden State Investments, LP delivered to the U.S. Bankruptcy Court for the Northern District of California, Oakland Division, its schedules of assets and debts, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $23,400,000 B. Personal Property $266 C. Property Claimed as Exempt D. Creditors Holding $29,166,989 Secured Claims E. Creditors Holding 0 Unsecured Priority Claims F. Creditors Holding $140,000 Unsecured Nonpriority Claims ----------- ----------- TOTAL $23,400,266 $29,306,989 Pleasanton, California-based Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. filed separate voluntary chapter 11 petitions on February 14, 2008, before the U.S. Bankruptcy Court for the Northern District of California (Oakland) (Lead Case No.: 08-40689). GOLDEN STATE: Sec. 341 Meeting of Creditors Set for March 17 ------------------------------------------------------------ The United States Trustee for the Northern District of California, Oakland Division, will convene a meeting of creditors of Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. on March 17, 2008, at 09:30 a.m. at the Oakland U.S. Trustee Office. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in the Debtors' case. 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. Pleasanton, California-based Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. filed separate voluntary chapter 11 petitions on February 14, 2008, before the U.S. Bankruptcy Court for the Northern District of California (Oakland) (Lead Case No.: 08-40689). Golden State Investments listed $23,400,266 in total pre- bankruptcy assets and $29,306,989 in total pre-bankruptcy debts. GOLDEN STATE: June 16 General Claims Bar Date Set ------------------------------------------------- Matthew J. Shier, Esq., at Pinnacle Law Group LLP, advises that proofs of claim against and proofs of interest in Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. must be filed by June 16, 2008. Pleasanton, California-based Golden State Investments, L.P., and Pegasus-M.H. Ventures I, L.L.C. filed separate voluntary chapter 11 petitions on February 14, 2008, before the U.S. Bankruptcy Court for the Northern District of California (Oakland) (Lead Case No.: 08-40689). Golden State Investments listed $23,400,266 in total pre- bankruptcy assets and $29,306,989 in total pre-bankruptcy debts. GREEKTOWN HOLDINGS: S&P Puts 'B' Corp. Rating on Negative Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Greektown Holdings LLC, including the 'B' corporate credit rating, on CreditWatch with negative implications. "The CreditWatch placement reflects concerns about Greektown's liquidity position, stemming from weak operating performance and the potential for near-term covenant violations," said Standard & Poor's credit analyst Melissa Long. As a result, the company has been attempting to sell an ownership stake in Greektown Casino LLC, and a purchase and sale agreement was recently terminated. (Greektown Holdings is the parent company of Greektown Casino.) In resolving the CreditWatch listing, S&P will monitor Greektown's progress in completing a sale of equity in the casino. Should the company be successful in completing a sale, S&P may affirm the rating at the current level depending on the terms of the transaction. If the company is unsuccessful in negotiating a sale, the rating could be lowered. Although S&P believes that the Sault Ste. Marie Tribe of Chippewa Indians would continue to support Greektown in curing any potential breaches of financial covenants (at least up to a point), the company's liquidity position would remain constrained, as it will likely need additional financing to complete its ongoing expansion. HANOVER SECURITIES: SIPC Moves for Liquidation Under Chapter 7 -------------------------------------------------------------- The Securities Investor Protection Corporation, which maintains a special reserve fund authorized by Congress to help investors at failed brokerage firms, is liquidating Hanover Investment Securities Inc. of Madisonville, Louisiana, under the terms of the Securities Investor Protection Act. The liquidation of the New Orleans area broker-dealer is the first SIPA proceeding to be initiated by SIPC in 14 months. SIPC General Counsel Josephine Wang said that an inquiry into Hanover began after a complaint was received by SIPC and then referred to the Financial Industry Regulatory Authority for investigation. FINRA's investigation revealed that a former principal of the firm had misappropriated investor funds and converted them to his own use before committing suicide on Feb. 7, 2008. Investor losses may be as much as $2 million. On Feb. 28, 2008, on an application by SIPC, the U.S. District Court for the Eastern District of Louisiana appointed SIPC to act as trustee for Hanover and the law firm of Lemle & Kelleher, LLP, to act as counsel to the trustee. As trustee, SIPC immediately secured the premises and books and records of Hanover. SIPC will seek permission from the Bankruptcy Court to publish notice of the commencement of the proceeding and to mail claims materials to customers and creditors of the broker- dealer, Wang said. Information about the case also will be made available on the Web at http://www.sipc.org The liquidation proceeding is docketed as case number 08-01021 in the United States Bankruptcy Court for the Eastern District of Louisiana, where it has been assigned to Judge Jerry A. Brown. ABOUT SIPC The Securities Investor Protection Corporation -- http://www.sipc.org/-- is the U.S. investor's first line of defense in the event a brokerage firm fails owing customer cash and securities that are missing from customer accounts. From the time Congress created it in 1970 through December 2006, SIPC has advanced $505 million in order to make possible the recovery of $15.7 billion in assets for an estimated 626,000 investors. Although not every investor is protected by SIPC, SIPC estimates that no fewer than 99 percent of persons who are eligible have been made whole in the failed brokerage firm cases that it has handled to date. SIPC either acts as trustee or works with an independent court- appointed trustee in a brokerage insolvency case to recover funds. The statute that created SIPC provides that customers of a failed brokerage firm receive all non-negotiable securities that are already registered in their names or in the process of being registered. At the same time, funds from the SIPC reserve are available to satisfy the remaining claims of each customer up to a maximum of $500,000. This figure includes a maximum of $100,000 on claims for cash. HIGH GRADE: Poor Credit Quality Prompts Moody's Rating Downgrades ----------------------------------------------------------------- Moody's Investors Service downgraded ratings of seven classes of notes issued by High Grade Structured Credit CDO 2007-1, 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: Up to $3,240,000,000 Class A-1A Floating Rate Extendible Notes/CP Notes -- Prior Rating: P-1 -- Current Rating: P-1, on review for possible downgrade Class Description: Up to $3,240,000,000 Class A-1B Notes -- Prior Rating: Aaa -- Current Rating: Baa2, on review for possible downgrade Class Description: $200,000,000 Class A-2 Senior Secured Floating Rate Notes Due 2052 -- Prior Rating: Aaa -- Current Rating: B1, on review for possible downgrade Class Description: $300,000,000 Class A-3 Senior Secured Floating Rate Notes Due 2052 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Caa1, on review for possible downgrade Class Description: $115,000,000 Class B Senior Secured Floating Rate Notes Due 2052 -- Prior Rating: Aa2, on review for possible downgrade -- Current Rating: Caa3, on review for possible downgrade Class Description: $65,000,000 Class C Secured Floating Rate Deferrable Notes Due 2052 -- Prior Rating: A2, on review for possible downgrade -- Current Rating: C Class Description: $40,000,000 Class D Secured Floating Rate Deferrable Notes Due 2052 -- Prior Rating: Baa2, on review for possible downgrade -- Current Rating: C The rating downgrade actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence on Feb. 27, 2008, as reported by the Trustee, of an event of default described as a Senior Overcollateralization Default in Section 5.01(i) of the Indenture dated May 24, 2007. High Grade Structured Credit CDO 2007-1 is a collateralized debt obligation backed primarily by a portfolio of CDO securities. Recent ratings downgrades on the underlying portfolio caused ratings-based haircuts to affect the calculation of overcollateralization. Thus, the Senior Overcollateralization Default described in Section 5.01(i) of the Indenture occurred. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, holders of certain 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 the Class A-1A Notes, Class A-1B Notes, Class A-2 Notes, Class A-3 Notes, and Class B Notes remains on review for possible further action. HOLLEY PERFORMANCE: Can Access Cash Collateral on Final Basis ------------------------------------------------------------- The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware granted, on a final basis, Holley Performance Products Inc. and its debtor-affiliates access to Wells Fargo Foothill Inc.'s cash collateral. The Debtors plan to use Wells Fargo's cash collateral to: -- pay carve-out expenses; and -- pay insurance, rent, payroll and utilities obligations up to $200,000 and any other expenses. The Debtors advised the Court that they have an urgent need to use cash collateral to finance company operations in the ordinary course of business. The Debtors granted Wells Fargo perfected postpetition security interests in and liens on the debtor-in-possession collateral. A full-text copy of Holley Performance's Weekly Cash Forecast is available for free at http://ResearchArchives.com/t/s?28db About Holley Performance Bowling Green, Kentucky-based Holley Performance Products Inc. -- http://www.holley.com/-- was was founded in 1903 by brothers George and Earl Holley. It currently employs 390 workers in Kentucky, California and Mississippi. It is the parent company of various companies offering the Holley brands, including Hooker, FlowTech and Nitrous Oxide Systems. Holley carburetors power every NASCAR(R) Sprint(R) Cup team and every NHRA(R) Pro-Stock champion. The Holley line also includes performance fuel pumps, fuel injection, intake manifolds, cylinder heads & engine dress-up products for street performance, race and marine applications. The company filed for Chapter 11 protection on February 11, 2008 (Bankr. Del. Case No.08-10256). Evelyn J. Meltzer, Esq., and David B. Stratton, Esq., at Pepper Hamilton, L.L.P., represents the Debtors' in their restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in these cases to date. When the Debtors filed for protection against their creditors, it listed total assets of $106,000,000 and total debts of $243,000,000. * * * As reported in the Troubled Company Reporter on Feb. 15, 2008, the Court will hold a hearing March 19, 2008, to consider confirmation of the Debtor's prepackaged chapter 11 plan of reorganization. HOLLEY PERFORMANCE: Gets Final Okay to Use $60 Mil. DIP Financing ----------------------------------------------------------------- The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware granted Holley Performance Products Inc. and its debtor-affiliates permission to obtain up to $60 million in secured postpetition financing from Wells Fargo Foothill Inc., on a final basis. As reported in the Troubled Company Reporter on Feb. 14, 2008, the postpetition financing agreement allows the Debtor to access up to $2 million at any one time under the revolving credit facility. The DIP loan will bear interest at the LIBOR Rate plus 6% or the Base Rate plus 3.88%. As adequate protection, the Debtors granted priority over any and all administrative expense claims and unsecured claims against the Debtors' estate. The Debtors intended to use the proceeds of the DIP loan to repay the prepetition credit facility, finance working capital, and general corporate purposes. A full-text copy of the credit agreement is available for free at: http://ResearchArchives.com/t/s?27fa About Holley Performance Bowling Green, Kentucky-based Holley Performance Products Inc. -- http://www.holley.com/-- was was founded in 1903 by brothers George and Earl Holley. It currently employs 390 workers in Kentucky, California and Mississippi. It is the parent company of various companies offering the Holley brands, including Hooker, FlowTech and Nitrous Oxide Systems. Holley carburetors power every NASCAR(R) Sprint(R) Cup team and every NHRA(R) Pro-Stock champion. The Holley line also includes performance fuel pumps, fuel injection, intake manifolds, cylinder heads & engine dress-up products for street performance, race and marine applications. The company filed for Chapter 11 protection on February 11, 2008 (Bankr. Del. Case No.08-10256). Evelyn J. Meltzer, Esq., and David B. Stratton, Esq., at Pepper Hamilton, L.L.P., represents the Debtors' in their restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in these cases to date. When the Debtors filed for protection against their creditors, it listed total assets of $106,000,000 and total debts of $243,000,000. * * * As reported in the Troubled Company Reporter on Feb. 15, 2008, the Court will hold a hearing March 19, 2008, to consider confirmation of the Debtor's prepackaged chapter 11 plan of reorganization. INTERSTATE BAKERIES: Various Parties Oppose Plan Confirmation ------------------------------------------------------------- Various industry unions, taxing authorities, creditors and other parties-in-interest delivered to the U.S. Bankruptcy Court for the Western District of Missouri their objections to the confirmation of Interstate Bakeries Corp. and its debtor-affiliates' First Amended Joint Plan of Reorganization. The objecting parties include: * the International Brotherhood of Teamsters; * the Official Committee of Unsecured Creditors; * the Official Committee of Security Equity Holders; * pension funds, composed of: -- Pension Benefit Guaranty Corporation; -- Teamsters Union Local No. 142 Pension Fund; -- Retail, Wholesale and Department Store International Union and Industry Pension Fund; -- International Union, United Automobile, Aerospace, Agricultural Implement Workers of America and United Auto Workers Local 2828; and -- American Bakers Association Retirement Trust; * taxation and revenue authorities, including: -- United States of America Internal Revenue Service; -- Ohio Department of Development and Taxation; -- Louisiana Department of Revenue; -- Missouri Department of Revenue; and -- Massachusetts Department of Revenue; * parties to insurance procurement agreements, namely: -- Broadspire Services, Inc.; and -- Kemper Insurance Companies; * other parties-in-interest, consisting of: -- Barry Callebaut USA LLC, a defendant in an Adversary Action relating to a preferential transfer for $1,378,524 allegedly made by the Debtors; -- Nor-Jam Corporation, landlord of a real property at 4534 Yellowstone Avenue in Chubbuck, Idaho, leased by Hollywood Brands Corporation in April 1996; and -- Janet Jones, a claimholder. The Teamsters contend that the Plan cannot be confirmed because (i) "[it] is premised upon concessions from Teamster contracts that do not exist", and (ii) more than half the Plan's asserted $600,000,000 value of the estate comes from concessions that have not been granted by the Teamsters. Frederick Perillo, Esq., at Previant, Goldberg, Uelmen, Gratz, Miller & Brueggeman, S.C., in Milwaukee, Wisconsin, relates that the Debtors' several long-term extensions or renegotiated collective bargaining agreements with the Teamsters will return to the status of non-modified CBAs as none of those will be assumed upon confirmation, pursuant to the Plan. In effect, a Plan confirmation will trigger a clause in the contracts that will obligate the Debtors to pay its members an administrative expense of $47,000,000 in benefits reduced by the non-assumed LTEs, which, pursuant to the Teamsters' further examination, the Debtors will be unable to pay, Mr. Perillo tells Judge Venters. Mr. Perillo explains that in the event that Silver Point Finance, LLC, proceeds with its exit financing bid for IBC and waives the condition that the Teamsters should grant concessions, the Debtors will be in violation of Section 1129(a)(9)(A) of the Labor Code, because cash is not available to satisfy claims that will arise from the breach as a result of the Plan confirmation. In the alternative, Mr. Perillo says, the Debtors would either liquidate or undergo another restructuring under Chapter 11 for further financial reorganization. Additionally, the Debtors' non-consensual modifications to, and rejections of, their collective bargaining agreements is an "unlawful scheme"that cannot be achieved through a plan of reorganization, Mr. Perillo points out. Representing the Creditors Committee, Scott Cargill, Esq., at Lowenstein Sandler PC, in Roseland, New Jersey, says that that the Debtors failed to provide the Committee with adequate information to review the Long Term Incentive Plan which the Debtors propose to adopt upon Plan confirmation. Among other things, the Creditors Committee raises concerns on: * the LTIP's set-aside of 15% of the equity in the Reorganized Debtors; * the LTIP's effective period; * the LTIP's set-aside of 15% of the Class B Common Stock; * the undisclosed names of the LTIP participants; * the forms of awards under the LTIP; and * the terms and vesting periods for awarded stock options. In addition, Mr. Cargill maintains that the Plan's Charter and Bylaws should be amended with respect to, among others, the voting ratio between Class A and Class B common stock and a member of the board of directors to be elected by holders of Class B common stock. The Equity Committee contends that pursuant to Section 1129(c) of the Bankruptcy Code, the Plan is not feasible because its confirmation is likely to be followed by liquidation, or the need for further financial reorganization. Moreover, absent the support of the Teamsters as the most critical party to the Plan's implementation, the Plan cannot be confirmed, Rebecca Stroder, Esq., at Sonnenschein Nath & Rosenthal LLP, in Kansas City, Missouri, maintains. Ms. Stroder points out that the exit financing bid of Silver Point "underestimates the value of the Debtors"and fails to commit the full range of their resources to reorganization and repayment. Without resolution to the union dispute, potential investors could not assess adequately on what they were bidding, thus the Plan is not proposed in good faith, Ms. Stroder notes. Furthermore, the Debtors have not demonstrated flexibility when considering other means to restructure their businesses, which include: -- implementing an "independent operator"delivery system used successfully by competitors; -- selling either bread or snack operations and reorganizing around the operations remaining; and -- continuing to exit unprofitable markets while focusing on their profitable markets. The Equity Committee submits that the Debtors have neither explored their options to acquire capital infusion and exit financing nor committed fully their resources to restructuring, which should otherwise benefit the equity security holders. The PBGC, on the other hand, finds a disparity between the Debtors' First Amended Plan and Disclosure Statement with respect to the discharge of liabilities relating to pension plans. According to the Disclosure Statement, the Debtors' contingent liabilities to PBGC with respect to pension plans that are not triggered by termination will not be affected by the Plan. In complete contrast, the Plan discharges the Debtors of all liabilities arising from the pre- or post-confirmation termination of any employee benefit program. The Retail Union and Industry Pension Fund, the Teamsters Local Union and the ABA Retirement Plan argue that the Debtors' discharge provision as amended in the Plan -- which contemplates all potential future withdrawal of liabilities in the event of post-confirmation withdrawal from any of the multiemployer plans -- is at odds with a policy to "protect the solvency of multiemployer pension plans." The Pension Funds lament that the provision affords a disparate treatment among all multiemployer pension funds with respect to withdrawal liability claims. Certain of the members of the United Auto Workers and the Debtors have a profound disagreement relating to certain pension funds, and are involved in a complex litigation in the United States District Court for the District of Columbia. Accordingly, UAW submits that the Plan is not confirmable because it is dependent on the Silver Point transaction, which is contingent on the Debtors' agreement with their unions -- including UAW -- which will not be completed prior to the confirmation hearing. The Internal Revenue Service and the taxation departments of Ohio, Louisiana, Missouri and Massachusetts contend that the Plan should be structured to adhere to conditions pursuant to tax laws and statutes. Hence, the Plan should not be confirmed until: (a) tax claims are afforded with their "rightful priorities," contrary to the general unsecured treatment contemplated by the Plan; (b) the acceptable market rate of interest on priority tax claims should be applied pursuant to Sections 1129(a)(9)(C) of the Bankruptcy Code and to applicable statutes; (c) interest and penalties are entitled on administrative claims, contrary to the Plan's provision that "no Claimholder [will] be entitled to interest accruing on or after the Petition Date on any Claim . . ." (d) the Debtors clarify the discharge provision of officers, directors, employees in the event of a default; (e) claims arising from additional taxes that are discovered may be filed within a reasonable time; and (f) tax payment, as applicable to the Louisiana Revenue Department, will be within 30 days of, or upon, the Effective Date of the Plan. According to Broadspire and Kemper, the Plan should be modified to express that the Debtors will be required to cure all of the insurance providers' prepetition claims when they assume certain service agreements upon the confirmation of their Plan. Broadspire and Kemper also retain their rights to collateral, including the rights to set-off and recoupment. Callebaut contends that the Plan is not confirmable until it explicitly clarifies that "nothing in the Plan waives [Callebaut's] rights or defenses in any litigation against the entity by the Debtors or their successors." Nor-Jam maintains that the Debtors' Plan failed to (i) "cure"the default of the Debtors' Lease with the Landlord; (ii) compensate Nor-Jam for any actual pecuniary loss resulting from the default, as required by Sections (b)(1)(A) and (B) of the Bankruptcy Code; (iii) provide adequate assurance of future performance under the Lease; (iv) propose to treat the unpaid tax claim as an Allowed Secured Tax Claim; and (v) pay the interest, costs and attorney's fees incurred by Nor-Jam in enforcing the terms of the Lease under the Debtors' Chapter 11 cases. About IBC Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh-baked bread and sweet goods, under various national brand names, including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and Drake's(R). Currently, IBC employs more than 25,000 people and operates 45 bakeries, as well as approximately 800 distribution centers and approximately 800 bakery outlets throughout the country. The company and eight of its subsidiaries and affiliates filed for chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No. 04 45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6% senior subordinated convertible notes due Aug. 15, 2014) in total debts. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 5, 2007. Their exclusive period to file a chapter 11 plan expired on November 8. On Jan. 25, 2008, the Debtors filed their First Amended Plan and Disclosure Statement. On Jan. 30, 2008, the Debtors received Court approval of the First Amended Disclosure Statement. IBC confirmed that it has not received any qualifying alternative proposals for funding its plan of reorganization in accordance with the Court-approved alternative proposal procedures. As a result, no auction was held on Jan. 22, 2008, as would have been required under those procedures. The deadline for submission of alternative proposals was Jan. 15, 2008. (Interstate Bakeries Bankruptcy News, Issue No. 90; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). INTERSTATE BAKERIES: Teamsters Inks Deal with Ripplewood -------------------------------------------------------- The International Brotherhood of Teamsters is taking a second shot at bringing in an investor for bankrupt Interstate Bakeries Corp., The Associated Press reports. In an interview with the Kansas City Star, union spokesman Rich Volpe confirmed that the Teamsters has reached an agreement with Ripplewood Holdings, a New York-based hedge fund founded by Tim Collins. The deal includes collective bargaining agreements covering the 10,000 Teamster members working for IBC and calls for a number of concessions from the Teamsters, which Mr. Volpe says is "workable,"the report says. Mr. Volpe told the Star that the Ripplewood agreement will call for new IBC management and board members, including Greg Murphy from Ripplewood, but may not necessarily displace chief executive officer Craig Jung and his management team, "at least not in the near term." Mr. Volpe said Ripplewood is now talking with Silver Point Finance, LLC, which has already agreed to provide IBC with $400,000,000 in after-bankruptcy financing. The spokesman confirmed that Yucaipa is not involved in the Ripplewood deal, according to the report. Teamsters officials agreed to make concessions under a new contract should Ripplewood and other investors take control of IBC, lawyer Frederick Perillo told Bloomberg News. "At the appropriate time we are all very hopeful that we will propose an alternative reorganization plan,"he added. IBC confirmed that it was aware of the Teamsters' negotiations with a third party on a proposed labor agreement, and that company officials were reviewing the matter. "With respect to the reported discussion between IBT and a third party, when and if the company receives an alternative plan with committed financing, a business plan and proposed recovery for constituents, it will assess the proposal,"IBC said in a statement. Reports say officials at Ripplewood could not be reached for comments. About IBC Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh-baked bread and sweet goods, under various national brand names, including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and Drake's(R). Currently, IBC employs more than 25,000 people and operates 45 bakeries, as well as approximately 800 distribution centers and approximately 800 bakery outlets throughout the country. The company and eight of its subsidiaries and affiliates filed for chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No. 04 45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6% senior subordinated convertible notes due Aug. 15, 2014) in total debts. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 5, 2007. Their exclusive period to file a chapter 11 plan expired on November 8. On Jan. 25, 2008, the Debtors filed their First Amended Plan and Disclosure Statement. On Jan. 30, 2008, the Debtors received Court approval of the First Amended Disclosure Statement. IBC confirmed that it has not received any qualifying alternative proposals for funding its plan of reorganization in accordance with the Court-approved alternative proposal procedures. As a result, no auction was held on Jan. 22, 2008, as would have been required under those procedures. The deadline for submission of alternative proposals was Jan. 15, 2008. (Interstate Bakeries Bankruptcy News, Issue No. 90; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). INTERSTATE BAKERIES: Wants to Move Confirmation Hearing to Apr. 23 ------------------------------------------------------------------ Interstate Bakeries Corp. and its debtor-affiliates asked the U.S. Bankruptcy Court for the Western District of Missouri to continue the confirmation hearing on its plan of reorganization, currently scheduled for March 12, 2008, to April 23, 2008. The Debtors are currently engaged in discussions with multiple parties regarding modifications to its plan of reorganization that would allow the company to emerge from Chapter 11 as a stand-alone company. A financial investor had previously expressed interest in making an equity investment in the company and last week provided the company with a proposal regarding labor concessions to which the International Brotherhood of Teamsters was willing to agree if the financial investor were to become an investor in the company. IBC said that it continues to review the proposed labor concessions negotiated between the financial investor and the Teamsters to determine if the proposed terms are acceptable to the company, and looks forward to a term sheet from the financial investor with details on committed financing and constituent recoveries, as well as any suggested modifications to the company's business plan, for consideration by IBC's board of directors. "We are pleased with the interest financial investors have shown in our company,"Chief Executive Officer Craig Jung said. "We remain hopeful that, working together with all our constituents, we will be able to quickly achieve modifications to our plan of reorganization, or receive an alternative plan of reorganization that will allow IBC to maximize constituent recoveries and emerge from Chapter 11 well positioned to compete in the marketplace and build capability and competitive advantage." As a consequence of the continuance of the confirmation hearing, the company expects the commitment from Silver Point Finance, LLC for exit financing of up to $400 million to expire on March 14, 2008, in accordance with its terms. The current exit financing commitment contained several conditions, including a requirement that the Company obtain confirmation of its plan of reorganization by March 14, 2008. Continuing the confirmation hearing to April 23, 2008 makes it impossible for the company to fulfill that condition. The company said that it plans to continue discussions with Silver Point Finance, L.L.C. as well as other parties in an effort to obtain a replacement commitment for exit financing for a stand- alone plan of reorganization. However, there can be no assurances that the company will be successful in obtaining a new exit financing commitment. To meet its obligation to maximize constituent recovery and ensure the best possible outcome for its constituents, IBC also announced that concurrent with the actions discussed above, it has begun an orderly process to sell all or portions of the company's businesses and assets. The company and its financial advisors believe that absent a confirmable, standalone plan of reorganization, a sale of the company in multiple transactions is the best alternative to maximize the recovery to stakeholders. "Under the circumstances, the only prudent course of action for the company is to embark on a dual-path and explore alternatives that include the sale of the Company in multiple transactions. As part of this process, we will immediately begin holding discussions with potential strategic purchasers, many of whom have already expressed interest in buying certain of the company's businesses and assets,"Mr. Jung said. To provide the company with sufficient time and liquidity to support normal business operations as it pursues this dual path process, IBC has begun discussions with JPMorgan Chase Bank, N.A., as administrative agent for the lenders party to the existing debtor-in-possession financing agreement, to extend the maturity date and increase the size of its current DIP credit facility. The DIP credit facility is currently set to expire on June 2, 2008. The company can provide no assurance that it will be able to obtain an extension or increase the size of its DIP financing facility on acceptable terms or at all. About IBC Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh-baked bread and sweet goods, under various national brand names, including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and Drake's(R). Currently, IBC employs more than 25,000 people and operates 45 bakeries, as well as approximately 800 distribution centers and approximately 800 bakery outlets throughout the country. The company and eight of its subsidiaries and affiliates filed for chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No. 04 45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6% senior subordinated convertible notes due Aug. 15, 2014) in total debts. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 5, 2007. Their exclusive period to file a chapter 11 plan expired on November 8. On Jan. 25, 2008, the Debtors filed their First Amended Plan and Disclosure Statement. On Jan. 30, 2008, the Debtors received Court approval of the First Amended Disclosure Statement. IBC confirmed that it has not received any qualifying alternative proposals for funding its plan of reorganization in accordance with the Court-approved alternative proposal procedures. As a result, no auction was held on Jan. 22, 2008, as would have been required under those procedures. The deadline for submission of alternative proposals was Jan. 15, 2008. (Interstate Bakeries Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). INVACARE CORP: Names Robert K. Gudbranson as CFO ------------------------------------------------ Invacare Corporation appointed Robert K. Gudbranson as senior vice president and chief financial officer, effective April 1, 2008. Recently, Mr. Gudbranson served as vice president of strategic planning and acquisitions for Lincoln Electric Holdings Inc., a $2 billion manufacturer of welding, brazing and soldering products located in Cleveland, Ohio. Prior to joining Lincoln Electric, Mr. Gudbranson was the director of business development and investor relations at Invacare. In his new role, Mr. Gudbranson, 44, will be responsible for all aspects of Invacare's Finance, Treasury, Internal Audit, Investor Relations, and Information Technology functions. "We are extremely pleased to have Rob Gudbranson joining Invacare Corporation as chief financial officer," A. Malachi Mixon, III, chairman and chief executive officer, said. "His extensive background in strategic planning and business development, well as his financial experience with Invacare, will be instrumental in helping guide Invacare Corporation as we work toward our growth agenda for 2008 and beyond." Mr. Gudbranson began his career in finance at JP Morgan, progressing through positions of increased responsibility in corporate financial management and banking. Prior to joining Lincoln Electric, he held various financial roles of increasing responsibility for Invacare including: director, business development and investor relations; assistant treasurer; and European finance director. Mr. Gudbranson holds a bachelor of arts degree in applied mathematics from Yale University and a master of arts in politics and economics from Oxford University. Mr. Gudbranson replaces Gregory C. Thompson who resigned as Invacare's CFO in February 2008 to join Georgia Gulf Corporation, Inc. "We are also taking this opportunity to reaffirm our 2008 guidance," Mr. Mixon added. "Specifically, while it is still very early in the year, the business is progressing consistently with our internal expectations. We are comfortable with our adjusted earnings per share(a) guidance of $1.35 to $1.50 with organic growth of approximately 4% to 5%, excluding the impact from acquisitions and foreign currency translation adjustments. We expect that historical seasonal patterns of the business, which generally favor the latter half of the year, will essentially repeat in 2008, but that modest quarterly improvements on a year- over-year basis should continue." About Invacare Corp. Headquartered in Elyria, Ohio, Invacare Corporation (NYSE: IVC) -- http://www.invacare.com/-- manufactures and distributes innovative home and long-term care medical products. The company has 5,700 associates and markets its products in 80 countries around the world. * * * Moody's Investor Service placed Invacare Corporation's long term corporate family and probability of default ratings at 'B1' in January 2007. The ratings still hold to date with a stable outlook. ISLE OF CAPRI: S&P Designates 'BB-' Rating on Negative CreditWatch ------------------------------------------------------------------ Standard & Poor's Ratings Service placed its ratings for Isle of Capri Casinos Inc., including the 'BB-' corporate credit rating, on CreditWatch with negative implications. "The CreditWatch listing follows a slower-than-expected ramp up at the company's Pompano Park, Waterloo, and Coventry properties, as well as continued EBITDA declines at several of the company's other facilities, including all of those in Mississippi and Louisiana," said Standard & Poor's credit analyst Ariel Silverberg. "As a result, credit measures are not likely to improve over the intermediate term to the extent that we previously had expected. Credit measures are currently very weak for the rating." For the first nine months of fiscal 2008 (ending Jan. 27, 2008), property level EBITDA was up 1.1%, primarily due to contributions from properties opened in the first quarter of 2008. When comparing only those properties in operation for the full nine month period in both 2007 and 2008, property level EBITDA was down 8.6%, primarily as a result of significant declines in Mississippi, partially mitigated by EBITDA improvements in Black Hawk. S&P expects these properties will continue to be challenged over the intermediate term given the softness in the U.S. economy, which has resulted in revenue declines in several of the markets in which Isle operates. In resolving the CreditWatch listing, S&P will discuss with new management its plans associated with managing expenses and driving future revenue growth. S&P notes that this management team has had success in turning around other challenged gaming companies. Other factors that will be considered in S&P's review are Isle's financial strategies and its intermediate liquidity position. JACK ABERMAN: Case Summary & Nine Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Jack Aberman 434 North Halifax Avenue Suite 2 Daytona Beach, FL 32118 Bankruptcy Case No.: 08-01695 Chapter 11 Petition Date: March 6, 2008 Court: Middle District of Florida (Orlando) Debtor's Counsel: Elizabeth A. Green, Esq. Latham Shuker Eden & Beaudine LLP 390 North Orange Avenue Suite 600 Orlando, FL 32801 Tel: (407) 481-5800 Fax: (407) 481-5801 bankruptcynotice@lseblaw.com Estimated Assets: $10,000,001 to $50 million Estimated Debts: $10,000,001 to $50 million Debtor's list of its Nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chase Cardmember Sevices credit card $49,408 P.O. Box 15298 Wilmington, DE 19850 American Express credit card $18,968 P.O. Box 360002 Fort Lauderdale, FL 33336 Bank of America credit card $14,729 P.O. Box 15026 Wilmington, DE 19650 Wachovia FIA Card Services credit card $7,956 HSBC Card Services credit card $6,968 Volusia City Tax Collector real property $4,592 taxes Sam's Club credit card $3,799 Lowe's Commercial Services credit card $1,019 Home Depot Credit Services credit card $200 J-TAIL LLC: Involuntary Chapter 11 Case Summary ----------------------------------------------- Alleged Debtor: J-Tail LLC 410 North Burnet Manor, TX 78653 Case Number: 08-10416 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- J&T Development Group, LP 08-10417 Type of Business: single asset real estate Involuntary Petition Date: March 3, 2008 Court: Western District of Texas (Austin) Petitioner's Counsel: Mark Curtis Taylor, Esq. Hohmann & Taube LLP 100 Congress Avenue, Suite 1800 Austin, TX 78701 Tel: (512) 472-5997 markt@hts-law.com Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Brian Vodicka loan $1,055,000 1311 Spyglass Austin, TX 78746 Simons Family Trust loan $1,100,000 Attn: Capital Advantage 6700 East Pacific Coast Highway, Suite 140 Long Beach, CA 90803 Creative Lending Concepts LLC loan $645,000 3636 Executive Center Drive, Suite G-60 Austin, TX 78731 JEFFERSON COUNTY: In Technical Default on Swap Agreements --------------------------------------------------------- The Jefferson County (Ala.) was in technical default in relation to its $3.2 billion sewer debt on Friday, County commissioners confirmed according to Andrew Hayenga of NBC13.com (Ala.). The county was unable to post $184 million in collateral on its swap agreements with investment banks. The collateral was required under the agreement after a series of downgrades on the debt. The county is not yet in payment default, which occurs if the county discontinues payments to the banks. No demand for the payment has been made by the banks on Friday, County officials said, according to Barnett Wright of The Birmingham News. The technical default gives the banks the right to terminate the contracts and force payments totaling $184 million, the report stated. Peter Shapiro, managing director of New Jersey-based Swap Financial LLC, warns of a "cascade" of default as a result of a default on the swap. The county has 13 interest-rate swap transactions with Bank of America, Bear Stearns Inc., JP Morgan and Lehman Brothers in an aggregate amount of $5.4 billion. Last week, Jefferson county refused to pledge reserves against the interest-rate swaps tied to the sewer debt. Possible Bankruptcy A possible bankruptcy filing was mentioned by County Commissioner Bettye Fine Collins to a reporter at a commission meeting in Birmingham on Thursday. Commissioner Collins declined to comment on Friday, but confirmed the county might file for bankruptcy as a last resort, according to Birmingham News. Commissioner Collins, in a Reuters report, was cited as saying that the county officials were meeting in New York to solve its debt problem. She said the county was not expecting to use any of the $400 million in a county liquidity fund, according to the report. After the news of the technical default, a lawyer for the county confirmed that the talks are continuing, according to Birmingham News. There is no timetable for the county's debt renegotiations or a possible bankruptcy declaration, the report states. Interest Expense on Bonds Jefferson County is also increased interest expense on $3 billion in floating-rate obligations. Jefferson County has its seat in Birmingham. It has a population of 660,000. It ended its 2006 fiscal year with a $42.6 million general fund balance, according to Standard & Poor's. The county currently has about $82 million of cash on hand, and about $105 million in a separate sewer fund, S&P said. Patrick Darby, a lawyer with the Birmingham firm of Bradley Arant Rose & White, represents Jefferson County. JEFFERSON COUNTY: S&P Junks Sewer Revenue Debt Rating ----------------------------------------------------- Standard & Poor's Ratings Services lowered its underlying rating on Jefferson County, Alabama's sewer revenue debt three notches to 'CCC' from 'B' due to the likelihood that the county will not post collateral to counterparties by March 7, 2008, as specified in the terms of the county's swap agreements. In addition, the rating service revised its CreditWatch status on the debt to developing from negative, indicating the rating could move upward or downward in the short term. "According to our rating definitions, an obligation rated 'CCC' is currently vulnerable to nonpayment and dependent on favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation," said Standard & Poor's credit analyst Sussan Corson. "In the event of adverse business, financial, or economic conditions, however, the obligor is not likely to have the capacity to meet its financial commitment on the obligation." In a material event notice released on March 5, 2008, Jefferson County officials indicated they had "notified the counterparties to the swap agreements that it does not presently intend to post collateral or provide insurance to the counterparties for its obligations under the swap agreements." A failure to post collateral gives the counterparties the right to terminate the swap agreement; if a counterparty chooses to terminate the agreement, a termination payment, subordinate to debt service payments, would be due. Increased interest rates in conjunction with events of default under the standby warrant purchase agreements, termination events of the swap agreements, and the system's already very high debt burden have placed significant financial pressure on the county's sewer system. This action affects roughly $3.2 billion of debt outstanding. KEY DEVELOPERS: Section 341(a) Meeting Slated for April 2, 2008 --------------------------------------------------------------- Parties owed money by Key Developers Group LLC will have a meeting at 1:30 p.m., on April 2, 2008, at the courthouse in 501 East Polk Street in Tampa, Florida, Tampa Bay Business Journal's Michael Hinman relates. The Place at Channelside Web site -- http://www.theplacecondos.com/-- indicated Thursday that 95% of its 469 units have been sold, BizJournal says. That Web site is no longer accessible at press time. Based on BizJournal's report, Key Developer is facing a hundred lawsuits alleging breach of contract and demanding cancellation of contracts filed in November 2007 by buyers. The Place at Channelside is valued at $194 million, and its unit prices ranges from $180,000 to above $1 million, BizJournal adds. According to Emporis.Com, other firms involved in the construction of The Place include Bovis Lend Lease Inc., Kimmins Contracting Corp., Wichman Construction, Jablonsky, Ast and Partners, KTD Engineers, Cecconi Simone, Phil Graham & Company, PA, APG Electric Inc., Long Foundation Drilling Company, Williamson & Associates, Inc., KTD Engineers, Potain SAS, KONE Inc., CapForm Inc., and South Carolina Steel Corporation. The design was done by Hariri Pontarini Architects and Studiomarc International, Emporis.Com reveals. About Key Developers Tampa, Florida-based Key Developers Group LLC is a real estate developer. Its developments include a 469-unit, The Place at Channelside I and II. The Place at Channelside I, an-8-floor building, was completed in 2007, while The Place at Channelside II, a 32-floor building, was never built. Its president is Fida Sirdar Hussain. Key Developers filed for chapter 11 on March 5, 2008 (Bankr. M.D. Fla. Cas No. 08-02929). Scott A. Stichter, Esq., at Stichter, Riedel, Blain & Prosser PA represents the Debtor in its restructuring efforts. It listed asset between $100 million to $500 million and debts between $50 million to $100 million when it filed for bankruptcy. LINENS 'N THINGS: Weak Liquidity Prompts Moody's to Junk Ratings ---------------------------------------------------------------- Moody's Investors Service downgraded Linens 'N Things, Inc.'s ratings, including its corporate family rating to Caa1 and speculative grade liquidity rating to SGL-4. The rating outlook remains negative. The downgrade of the ratings is prompted by the company's year end borrowing levels being higher, and its revolver availability at year end being lower, than Moody's expectation -- resulting in the company's liquidity being weaker and leaving it with limited cushion to continue to sustain ongoing free cash flow deficits. These ratings are downgraded: -- Corporate family rating to Caa1 from B3; -- Probability of Default rating to Caa1 from B3; -- $650 Million of senior secured guaranteed notes due 2014 to Caa2 (LGD4, 64%) from B3 (LGD4, 55%), -- Speculative Grade Liquidity Rating to SGL-4 from SGL-3. The Caa1 corporate family rating reflects the company's exceptionally weak credit metrics and its weak liquidity. At year end the company had $205.9 million drawn under its revolving credit facility (versus $37.8 million at the end of 2006) with $302 million available. Based upon Moody's expectations for a continuation in free cash flow deficits, the company will likely need to continue to draw under its revolver over the next twelve months. This could potentially consume the majority of the company's remaining committed external liquidity. This weakened liquidity greatly diminishes the company's financial flexibility to withstand the current weak retail environment. Given the company's weak operating performance as well as challenges in the bank and broader financial markets, Linens 'N Things could have difficulty obtaining additional financing, if needed. In addition, the rating reflects the company's weak competitive position in a highly competitive home furnishings market, its negative EBITA margins during fiscal year 2007, and its history of mispositioned product offering. The rating category is supported by its solid nationwide store base and its well recognized brand name. The downgrade of the company's speculative grade liquidity rating to SGL-4 represents a further weakening in liquidity. The company's announced year end borrowings were higher than Moody's original expectations and therefore Moody's expects that the company's level of free cash flow deficit in 2007 increased versus 2006. Moody's expects that the company's generation of free cash flow deficits will likely continue in 2008, resulting in further borrowings under the revolver over the next twelve months. This will place increased pressure on the company's liquidity. Moody's notes that the company put in place a new $700 million revolving credit facility in October 2007 which does not contain any minimum availability requirements nor any financial covenants. However, the company has limited sources of alternate liquidity as all assets are pledged to the secured revolving credit facility and senior secured notes. The negative outlook primarily reflects Moody's expectation that the current weak retailing environment and heavy competition will continue to constrain the company's operating performance placing further stress on the company's liquidity and financial flexibility. Linens 'N Things' ratings could be downgraded should the company's operating performance and liquidity fail to improve from current weak levels -- resulting in an increased probability of default. Linens N Things Inc., headquartered in Clifton, New Jersey, is a nationwide specialty retailer of home textiles, housewares, and home accessories that operates approximately 589 stores in 47 states and seven Canadian provinces as of Dec. 29, 2007. Revenues for the lagging twelve month period ended Sept. 30, 2007 were approximately $2.8 billion. LIONEL LLC: Wants Court to Defer Confirmation Hearing to March 27 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York will convene a hearing, previously scheduled for March 13, 2008, on March 27, 2008, at 10:00 a.m. (New York Time), to consider confirmation of the Second Amended Joint Plan of Reorganization of Lionel LLC and and its debtor-affiliates Liontech Company, in the courtroom of the Honorable Burton R. Lifland, in the Alexander Hamilton Custom House at One Bowling Green in New York City. As reported in the Troubled Company Reporter on Oct. 31, 2008, the Debtors' sought and obtained approval of a disclosure statement explaining their reorganization plan integrating a settlement with its long-time adversary Mike's Train House Inc. Lionel for Chapter 11 protection in November 2004 after MTH won a $40.8 million judgment for misappropriating train designs. Bill Rochelle of Bloomberg News reports that most of the terms were not made public, the settlement has a March 31, 2008 deadline for emerging from reorganization. MTH Litigation The Debtors relates that after commencement of their Chapter 11 Cases, on Dec. 14, 2004, the Bankruptcy Court entered an order approving a stipulation between MTH and the Debtors modifying the automatic stay to permit Lionel to prosecute an appeal of the Judgment and Injunction entered by the Michigan District Court in the Trade Secrets Litigation. Thereafter, Lionel filed its appeal in the United States Court of Appeals for the Sixth Circuit on Jan. 15, 2005 and the Court of Appeals held oral arguments on June 7, 2006. Sixth Circuit Decision On Dec. 14, 2006, the Sixth Circuit Court issued its opinion in respect of the Appeal. Pursuant to the opinion, the Sixth Circuit Court reversed the Michigan District Court's order denying Lionel's request for a new trial, remanded the case for further proceedings, consistent with its opinion, and reversed the Michigan District Court's entry of the Injunction. In reaching these conclusions, the Sixth Circuit determined that the Michigan District Court had erred in admitting certain expert testimony and imposing joint and several liability, and that the jury award improperly "double counted"MTH's damages. On Dec 28, 2006, MTH filed with the Sixth Circuit a Petition for Panel Reconsideration, and Suggestion of Rehearing En Banc. On Feb. 1, 2007, Lionel filed its response to the Petition for Reconsideration. On April 19, 2007, the Sixth Circuit denied the Petition for Reconsideration. On April 26, 2007, MTH filed a motion to stay the issuance of a mandate that would remand the case back to the Michigan District Court pending its filing a petition for a writ of certiorari to the United States Supreme Court. On May 3, 2007, the Sixth Circuit entered an order staying the issuance of the mandate. On May 4, 2007, Lionel filed a motion to reconsider the stay; however, Lionel withdrew the motion on May 16, 2007. On May 30, 2007, MTH filed a motion to vacate the stay and requested that the mandate be issued. The Sixth Circuit granted this request and issued the mandate on June 15, 2007. However, the Trade Secrets Litigation remains stayed by operation of the automatic stay under Section 362 of the Bankruptcy Code. Mediation On Feb. 1, 2007, with the consent of Lionel and MTH, the Bankruptcy Court entered a stipulation and order providing for the Debtors and MTH to submit to non-binding mediation of all claims and counterclaims between them. United States Bankruptcy Judge Cecelia Morris was selected as the mediator. After several sessions with Judge Morris, no settlement was reached and on May 16, 2007, the mediation was terminated. Estimation MTH filed three Claims against Lionel relating to the Trade Secrets Litigation: (1) a claim in the amount of the Money Judgment, (2) a claim for post-Judgment interest and (3) a claim for attorneys' fees. On June 1, 2007, the Debtors filed an objection to the Trade Secrets Litigation Claims and requested that the Bankruptcy Court estimate the Money Judgment claim under section 502(c) of the Bankruptcy Code. MTH objected to the estimation motion and filed a cross-motion for relief from the automatic stay to permit the retrial of the Trade Secrets Litigation in the Michigan District Court. A hearing on these motions was commenced on June 27, 2007, and was completed on Aug. 2, 2007. By order dated Aug. 3, 2007, the Bankruptcy Court granted the Debtors' motion to estimate the Money Judgment claim and denied MTH's cross-motion for relief from the automatic stay. The estimation procedures have not yet been set by the Bankruptcy Court. On Aug. 13, 2007, MTH filed a notice of appeal with respect to the Estimation Order. The appeal was docketed in the United States District Court for the Southern District of New York on Sept. 10, 2007 and assigned to the Honorable Richard M. Berman with case number 07-Civ-7496 (RMB). About Lionel LLC Headquartered in Chesterfield, Michigan, Lionel L.L.C. -- http://www.lionel.com/-- markets model train products, including steam and die engines, rolling stock, operating and non-operating accessories, track, transformers and electronic control devices. The Company and its affiliate, Liontech Company, filed for chapter 11 protection on Nov. 15, 2004 (Bankr. S.D.N.Y. Case Nos. 04-17324 and 04-17324). Adam C. Harris, Esq., Abbey Walsh, Esq., and Adam L. Hirsch, Esq., at Schulte Roth & Zabel LLP; Dale Cendali, Esq., at O'Melveny & Myers LLP; and Ronald L. Rose, Esq., at Dykema Gossett PLLC, represent the Debtors. Houlihan Lokey Howard & Zukin Capital, L.P. and Ernst & Young LLP are the Debtors' financial advisors. Kurtzman Carson Consultants LLC acts as the Debtors' noticing and claims agent. As of May 31, 2007, the Debtor disclosed total assets of $39,161,000 and total debts of $62,667,000. Alan D. Halperin, Esq., and Robert D. Raicht, Esq., at Halperin Battaglia Raicht, LLP, represent the Official Committee of Unsecured Creditors. FTI Consulting, Inc., is the Committee's financial advisor. Alec P. Ostrow, Esq. in New York, represents Mike's Train House, Inc. LUCHT'S CONCRETE: Case Summary & 17 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Lucht's Concrete Pumping, Inc. 3800 South Federal Boulevard Sheridan, CO 80100 Bankruptcy Case No.: 08-12619 Type of Business: The Debtor offers concrete pumping services. See http://www.luchtsconcrete.com/and http://www.luchts.com/ Chapter 11 Petition Date: March 5, 2008 Court: District of Colorado (Denver) Judge: Sidney B. Brooks Debtor's Counsel: David Wadsworth, Esq. (dvw@sendwass.com) Harvey Sender, Esq. (Sendertrustee@sendwass.com) 1660 Lincoln Street, Suite 2200 Denver, CO 80264 Tel: (303) 296-1999 Fax: (303) 296-7600 Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtor's 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Dougherty Funding, LLC value of collateral: $5,244,987 90 South 7th Street, $3,314,000 Suite 4300 Minneapolis, MN 55402 SL Financial Services Corp value of collateral: $5,169,882 251 Riverside Avenue $2,845,150 Westport, CT 06880 First National Bank of value of collateral: $2,053,976 Colorado $860,000 P.O. Box 9032 Boulder, CO 80301-9032 Orix Financial Services, Inc. value of collateral: $1,241,207 P.O. Box 7247-0369 $955,500 Philadelphia, PA 19170-0369 All Points Capital Corp. value of collateral: $767,060 P.O. Box 3071 $556,500 Hicksville, NY 11802-3071 Omni National Bank value of collateral: $495,319 Six Concourse Parkway, $339,500 Suite 2300 Atlanta, GA 30328 Summit Financial $408,865 2455 East Parleys Way, Suite 200 Salt Lake City, UT 84109 SM Realty $365,998 Suite 201, 1400 Glenarm Pl. Denver, CO 80202 RP Capital Corp value of collateral: $277,662 7401 Metro Boulevard, $232,750 Suite 320 Edina, MN 55439 Kraus-Anderson Capital, Inc. value of collateral: $256,113 523 South Eigth Street, $191,100 Suite 523 West Minneapolis, MN 55404 Comdata $146,986 Carson Oil Co., Inc. $146,871 American Express $129,593 AGC-IUDE Local 701 Trust Fund $62,239 Stonehill Financial, LLC $45,434 Anthem Blue Cross/Blue Shield $39,820 Boulder Gas $36,078 MARSHALL HILL: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Marshall Hill Materials, Inc. P.O. Box 259 Newfoundland, NJ 07435 Bankruptcy Case No.: 08-13993 Type of Business: The Debtor is a wholesaler and retailer of building supplies. Chapter 11 Petition Date: March 6, 2008 Court: District of New Jersey (Newark) Debtor's Counsel: John J. Scura, III, Esq. Scura, Mealey & Scura, LLP 1599 Hamburg Turnpike P.O. Box 2031 Wayne, NJ 07470 Tel: (973) 696-8391 jscura@scuramealey.com Total Assets: $485,062 Total Debts: $1,519,961 Debtor's list of its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ State of New Jersey Division $144,874 of Taxes 50 Barrack Street Trenton, NJ 08646 Lakeland Bank Bank Loan $97,512 Attn: Mr. Phil Davis 250 Oak Ridge Road Oak Ridge, NJ 07438 Karen Hand $81,598 P.O. Box 643 Newfoundland, NJ 07435 IRS $67,102 Petocz Family Partnership $55,000 BAC Sales $52,294 IRS $45,126 Masda Corp $29,402 Bank America Strategic Solutions Bank Loan $25,382 Rinox Pavers LLC $20,167 Essroc Cement Corp $15,821 State of New Jersey $15,551 Ayers Supply $12,685 Diamond East $12,244 Energex American $10,000 Abbey Hart Brick $8,044 Marshall & Quenzel $7,500 Grinell Concrete $6,533 Wholesale Building $5,432 Idearc Media Corp. $5,022 MEDIANEWS GROUP: Worsening Cash Flow Cues S&P's Rating Cut to 'B-' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings for MediaNews Group Inc.; the corporate credit rating was lowered to 'B-' from 'B'. The ratings remain on CreditWatch with negative implications, where they were initially placed Feb. 28, 2008. "The ratings downgrade and CreditWatch listing reflect worsening trends in cash flow generation at MediaNews and our belief that at the current rate of cash flow decline, risks are heightened that MediaNews may violate its total leverage covenant in its credit facility over the near term,"said Standard & Poor's credit analyst Emile Courtney. Total leverage (as measured per the calculation required in the company's bank facility) was 6.53x at December 2007; this compares with the company's 6.75x total leverage covenant at December 2007, which steps down to 6.5x on June 30, 2008 and to 6.25x on Sept. 30, 2008. There is also limited cushion in the company's 4.25x senior leverage and 1.25x fixed-charge coverage covenants. S&P continues to believe that MediaNews' liquidity position could benefit from a history of good relationships with, and a long track record of, significant asset transactions with partners of solid credit quality. S&P expects that one possible solution-- should MediaNews encounter a covenant violation over the near term--would be to negotiate for a liquidity injection of some kind from a partner. Still, intermediate-term covenant compliance may remain uncertain given additional step-downs in future quarters. Over the near term, S&P will continue to assess expectations for cash flow generation and review with MediaNews the possibility for a transaction that may enhance the cushion under its bank covenants. MORGAN STANLEY: Fitch Affirms 'B' Rating on Class D Trusts ---------------------------------------------------------- Fitch Ratings has affirmed Morgan Stanley Dean Witter Mortgage Capital Owner Trust, Series 2000-F1 as: -- Classes A-2a and A-2b, rated 'AAA', remain on Rating Watch Negative*; -- Classes S and X affirmed at 'AA'; -- Class B affirmed at 'BBB'; -- Class C affirmed at 'BB'; -- Class D affirmed at 'B'; -- Class E remains at 'C/DR4'; -- Class F remains at 'C/DR5'; -- Class G remains at 'C/DR6'. *Class A-2a and A-2b ratings are based on the strength of the MBIA insurance policy Fitch's analysis incorporated anticipated losses on defaulted and specially serviced collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral-specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, credit support was found to be consistent with when the transaction was last reviewed leading to an affirmation of all outstanding ratings. MOVIE GALLERY: Court Okays $4.7 Million Employee Incentive Plan --------------------------------------------------------------- The Honorable Douglas O. Tice of the U.S. Bankruptcy Court for the Eastern District of Virginia approved Movie Gallery Inc. and its debtor-affiliates' Key Employee Incentive Plan. The Plan has two components -- the Management Incentive Plan and the Supplemental Incentive Plan. Judge Tice rules that payments made in contemplation of the Debtors' Key Employee Incentive Plan constitute transfers and obligations permitted by Sections 363(b) and 503(c)(3) of the U.S. Bankruptcy Code. Every payment and distribution obligation of the Debtors under the Incentive Plan will be treated as an administrative expense pursuant to Section 503(b)(1)(A). The Debtors will make payments under the Incentive Plan without further notice to the Court. As reported in the Troubled Company Reporter on Feb. 20, 2008, the Management Incentive Plan which provides a potential bonus computed -- in a similar manner to the Debtors' historical bonus plan -- based on a percentage of each participant's salary, to be awarded if the Debtors achieve certain levels of earnings before interest, taxes, depreciation and amortization. The bonus is computed and awarded on a quarterly or semi-annual basis depending upon the participant's position. On the other hand, the Supplemental Incentive Plan provides a bonus computed as a percentage of earnings to be awarded to after June 30, 2008, to participants who have satisfied the tailored objectives established accordingly. The Debtors maintained that the KEIP creates a fair, objective and incentive-based compensation structure for their employees that aligns employee interests with those of the Debtors' stakeholders to encourage maximum effort and performance during the restructuring process. About Movie Gallery Based in Dothan, Alabama, Movie Gallery Inc. -- http://www.moviegallery.com/-- is a home entertainment specialty retailer. The company owns and operates 4,600 retail stores that rent and sell DVDs, videocassettes and video games. The company and its debtor-affiliates filed for Chapter 11 protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq., at Kutak Rock LLP, is the Debtors' local counsel. The Debtors' claims & balloting agent is Kutzman Carson Consultants LLC. When the Debtors' filed for protection from their creditors, they listed total assets of $891,993,000 and total liabilities of $1,419,215,000. The Official Committee of Unsecured Creditors has selected Robert J. Feinstein, Esq., James I. Stang, Esq., Robert B. Orgel, Esq., and Brad Godshall, Esq., at Pachulski Stang Ziehl & Jones LLP, as its lead counsel, and Brian F. Kenney, Esq., at Miles & Stockbridge PC, as its local counsel. The Debtors' spokeswoman Meaghan Repko said that the company does not expect to exit bankruptcy protection before the second quarter of 2008. The Debtors have until June 13, 2008 to file their plan of reorganization. (Movie Gallery Bankruptcy News Issue No. 21; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/ or 215/945-7000) MOVIE GALLERY: Committee Supports Second Amended Chapter 11 Plan ---------------------------------------------------------------- Movie Gallery Inc. and its debtor-affiliates' Second Amended Chapter 11 Plan of Reorganization found support from their Official Committee of Unsecured Creditors. The Committee, in a letter addressed to Movie Gallery, Inc.'s unsecured creditors, stated that it has found that the Debtors' Second Amended Plan of Reorganization "provides the best recoveries to, its acceptance is in the best interest of all creditors, and any alternative would result in unnecessary delay, uncertainty, and expense." The Creditors Committee encouraged unsecured creditors to vote to accept the Plan. To enable landlords to have a meaningful opportunity to vote on the Plan, the Debtors -- at the Committee's behest -- have agreed to determine on March 10, 2008, whether they will assume or reject store leases, and notify landlords of rejection decisions at that time, said Committee chairman, William Kaye. Mr. Kaye added that the Debtors also agreed that landlords to unassumed leases will be entitled to vote with respect to those leases. The Creditors Committee believes that the procedures negotiated between the Debtors and Sopris Capital Advisors LLC provide a reasonable compromise that will afford landlords with claims based on currently or potentially rejected leases a fair opportunity to vote on the Debtors' Plan while, at the same time, enabling the Debtors to make final decisions on lease assumptions and rejections up until the latest possible date. The Creditors Committee said an alternative to the negotiated procedures will require the Debtors to make potentially premature decisions on the leases and consequently delay their exit from bankruptcy. The Creditors Committee added that it has actively negotiated with the Debtors and Sopris regarding the terms of the Plan, including the recoveries to be provided to and as among general unsecured creditors, which recoveries vary depending on numerous factors. Mr. Kaye noted that under the Plan: * Classes 6, 7A, 7B and & E will receive stock, warrants and net proceeds from a litigation trust; * Classes 7C, 7D and 7F will receive cash; * Class 6 bondholders are offered an opportunity to buy more stock in the Debtors through the Rights offering, which will raise $50,000,000 for the Reorganized Debtors due to a guaranteed backstop by Sopris; and * Classes 7A, 7B and & E are offered an aggregate $10,000,000 cash-out election, which entitles the Classes to make irrevocable election in connection with voting to forgo any stock, warrants or litigation proceeds and instead receive 42% to 50% in cash of the implied value of the shares of stock to be received otherwise. About Movie Gallery Based in Dothan, Alabama, Movie Gallery Inc. -- http://www.moviegallery.com/-- is a home entertainment specialty retailer. The company owns and operates 4,600 retail stores that rent and sell DVDs, videocassettes and video games. The company and its debtor-affiliates filed for Chapter 11 protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq., at Kutak Rock LLP, is the Debtors' local counsel. The Debtors' claims & balloting agent is Kutzman Carson Consultants LLC. When the Debtors' filed for protection from their creditors, they listed total assets of $891,993,000 and total liabilities of $1,419,215,000. The Official Committee of Unsecured Creditors has selected Robert J. Feinstein, Esq., James I. Stang, Esq., Robert B. Orgel, Esq., and Brad Godshall, Esq., at Pachulski Stang Ziehl & Jones LLP, as its lead counsel, and Brian F. Kenney, Esq., at Miles & Stockbridge PC, as its local counsel. The Debtors' spokeswoman Meaghan Repko said that the company does not expect to exit bankruptcy protection before the second quarter of 2008. The Debtors have until June 13, 2008 to file their plan of reorganization. (Movie Gallery Bankruptcy News Issue No. 21; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/ or 215/945-7000) MOVIE GALLERY: Judge Tice Approves Phase 2 Sale Procedures ---------------------------------------------------------- The Honorable Douglas O. Tice of the U.S. Bankruptcy Court for the Eastern District of Virginia approved the bidding and second auction procedures governing the disposition of the Debtors' interests in certain unexpired leases of non-residential property in Phase 2 locations and the lease cure procedures to determine the Debtors' cure amounts with respect to the Phase 2 Leases. A schedule of the Phase 2 Leases is available for free at: http://researcharchives.com/t/s?28de The Court further authorized the Debtors to enter into agreements for the sale of their designation rights associated with the Phase 2 Leases, subject to Court approval. Any executed Sale Agreement constitutes a sale free and clear of any interest including, without limitation, any liens, claims or encumbrances or other interests on or in the Phase 2 Leases that are subject to Sale Agreements. A purchaser under a Designation Rights agreement will be entitled to the protections afforded to good- faith purchasers. The Debtors will have no further liability for any breach of a Phase 2 Lease occurring after the closing of a sale, transfer, termination or assignment for a Phase 2 lease. Judge Tice will convene a hearing on March 20, 2008, at 2:00 p.m., prevailing Eastern Time, to consider approval of the Sale Agreements and the sale of designation rights, including objections to proposed cure amounts. Objections to the Sale Agreements and designation rights must be filed on March 18. Cure amount objections are due March 4. Cure Amount Objections More than 60 landlords filed objections to the proposed Phase 2 Leases cure amounts and asserted alternative cure amounts on account of unpaid rent or arrears, and repair and maintenance charges: * 2005 Main Street Plaza 1, LLC, * Artzibushev-University One, Limited, * Bammel Interests Ltd., * BBS Associates, LLC, * BC Wood Properties, * Bellevue Properties Group, * Benderson Development Company, Inc., * Cedar Springs Station, LLC, * Centro Properties Group, * CH Realty, IV, * Desert Mountain Enterprises, * Developers Diversified Realty Corporation, * Excel Enterprise, LLC, * Equity One, Inc., * GGF Pico Rivera, LLC, * Gould Investors, L.P., * Harvest Properties, LLC, * Highlands Plaza LLC, * Hollywood-Anniston, LLC, * Inland American Retail Management, LLC, * Inland Commercial Property Management, Inc., * Inland Southwest Management LLC, * Kenneth and Theresa Barber, * Liberty Station, Inc., * Lynchburg II, LLC, * Mattatuck Plaza (E&A) LLC, * Mesa Town Center, LLC, * National Retail Properties, L.P., * N.O.M. Franklin, Ltd., * North Hampton Properties, LLC, * Parkway Plaza, L.P., * Parr Financial Partners LLC, * PepperLane-SE Square Loop, LLC, * PBKE-Gitt, LLC, * Piedmont Old Alabama Partners, L.P., * Primestor Los Jardines, LLC, * PK III San Dimas Marketplace, * PMT Partners V, LLC, * Range Five, LLC, * Regency Centers, LP, * Realty Income Corporation, * Realty Income Texas Properties, LP, * Rebkee Partners New Kent, LLC, * SEMLAK, LLC, * SHAG of Mississippi, Inc., * Silvia Yanez-Salazar, * Steve and Carol Lin, * Scottsdale Fiesta Plaza, L.P., * Stephen L. Horowitz, * Table Mesa Shopping Center Partnership, LLP, * The Morris Companies Affiliates, * The Slane Company, Ltd., * Twiss Realty Co, Inc., * U.S. Retail Income VI, L.P., * Urstadt Biddle Properties, Inc., * Vestar California, XXII, L.L.C., * Weingarten Realty Advisors, * White Flint Plaza, LLC, * Whiteville Properties, LLC, * Windsor Hills Station, Inc., * WMS, LLC, Boston Road Property, LLC, et al., and * Yorkshire Village Properties, LLC About Movie Gallery Based in Dothan, Alabama, Movie Gallery Inc. -- http://www.moviegallery.com/-- is a home entertainment specialty retailer. The company owns and operates 4,600 retail stores that rent and sell DVDs, videocassettes and video games. The company and its debtor-affiliates filed for Chapter 11 protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq., at Kutak Rock LLP, is the Debtors' local counsel. The Debtors' claims & balloting agent is Kutzman Carson Consultants LLC. When the Debtors' filed for protection from their creditors, they listed total assets of $891,993,000 and total liabilities of $1,419,215,000. The Official Committee of Unsecured Creditors has selected Robert J. Feinstein, Esq., James I. Stang, Esq., Robert B. Orgel, Esq., and Brad Godshall, Esq., at Pachulski Stang Ziehl & Jones LLP, as its lead counsel, and Brian F. Kenney, Esq., at Miles & Stockbridge PC, as its local counsel. The Debtors' spokeswoman Meaghan Repko said that the company does not expect to exit bankruptcy protection before the second quarter of 2008. The Debtors have until June 13, 2008 to file their plan of reorganization. (Movie Gallery Bankruptcy News Issue No. 21; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/ or 215/945-7000) NEW GENERATION: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: New Generation Miracle Church, Inc. 4623 Bowleys Lane Baltimore, MD 21206 Bankruptcy Case No.: 08-13171 Type of Business: The Debtor is a religious organization. Chapter 11 Petition Date: March 6, 2008 Court: District of Maryland (Baltimore) Judge: Nancy V. Alquist Debtor's Counsel: Marc Robert Kivitz, Esq. (mkivitz@aol.com) 201 North Charles Street, Suite 1330 Baltimore, MD 21201 Tel: (410) 625-2300 Fax: (410) 576-0140 Total Assets: $1,162,920 Total Debts: $680,796 Debtor's 11 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Lighthouse Ministry of Faith, $50,000 Inc. P.O. Box 586 Havre de Grace, MD 21078 Bank of America, N.A. $22,500 P.O. Box 15710 Wilmington, DE 19886-5710 Avalon at Symphony Glen $6,533 Avalon Bay Communities, Inc. 12304 Baltimore Avenue, Suite E Beltsville, MD 20705 Comcast Spotlight $2,680 Mayor and City Council of $863 Baltimore Alarm Pro, LLC $450 APM Dundalk Guardian $381 The New Family Bureau $124 Idearc Media Corp. $72 Pine Heights Comm. Kitchen, $40 Ser., Inc. Sheila Y. Forman $1 OSI RESTAURANT: Weak Performance Cues Moody's to Hold 'B2' Rating ----------------------------------------------------------------- Moody's Investors Service affirmed the long-term ratings of OSI Restaurant Partners, Inc., CFR rated B2. In addition, Moody's lowered OSI's speculative grade liquidity rating to SGL-3 from SGL-2 and changed the outlook on all ratings to negative from stable. The negative outlook reflects OSI's weaker than anticipated operating performance and debt protection metrics that are weak for the current ratings. It is Moody's view that soft consumer spending, high operating costs, and competitive pressures may make it challenging for OSI to materially improve debt protection metrics over the intermediate term to levels required for OSI to maintain its current ratings. "The combination of a financially challenged consumer, higher operating costs, and competitive pressures will make it difficult for OSI to maintain margins, earnings, and cash flow without negatively impacting traffic patterns over the intermediate term" said Moody's Senior Analyst Bill Fahy, The downgrade of the speculative grade liquidity rating to SGL-3 (adequate liquidity) reflects Moody's view that weaker operating performance will result in lower than expected free cash flow and a more modest cushion under the company's financial covenants. The B2 corporate family rating reflects OSI's relatively weak operating performance and sizeable debt levels that have resulted in persistently weak debt protection metrics and limited free cash flow. The ratings also incorporate Moody's belief that current challenges impacting the restaurant industry, particularly casual dining, such as a financially challenged consumer, historically high commodity prices and operating costs, and increasing competition will persist for the intermediate term. However, the ratings also incorporate OSI's meaningful scale, the significant brand awareness of Outback Steakhouse, geographic diversity within the United States, and adequate liquidity. Ratings affirmed are: -- B2 corporate family rating, -- B2 probability of default rating, -- $150 million working capital revolver maturing in 2013, rated B1 (LGD 3, 33%) -- $100 million pre-funded revolver maturing in 2013, rated B1 (LGD 3, 33%) -- $1.310 billion term loan B maturing in 2014, rated B1 (LGD 3, 33%) -- $550 million senior unsecured notes maturing in 2015, rated Caa1 (LGD 5, 85%) Rating lowered is; -- Speculative Grade Liquidity rating, lowered to SGL-3 from SGL-2 The outlook has been changed to negative from stable OSI Restaurant Partners, Inc., headquartered in Tampa, Florida, is one of the largest casual dining restaurant companies in the world with eight concepts located throughout all 50 states and in 20 countries internationally. Revenues for LTM period ended Sept. 30, 2007 totaled approximately $4.1 billion. PARKWAY HOSPITAL: Ends Three-Year Term Under Chapter 11 Protection ------------------------------------------------------------------ The Parkway Hospital Inc. officially exited from chapter 11 protection on Feb. 28, 2008, ending its three-year term in bankruptcy, various reports relate. Parkway vice president Fred Stewart, told reporters that the emergence of the hospital was what they've wanted. According to the reports, Berger Commission, a state-assigned group formed to evaluate health care facilities, had recommended the closure of Parkway asserting mismanagement. Parkway then sued Berger Commission contesting the proposed revocation of the hospital's operating certificate. Parkway president and chief executive officer, Dr. Robert Aquino, told the public in a press conference that he is "exuberant and optimistic"about the progress at the hospital, reports say. He added that Parkway is now posed "to become one of the region's premier hospitals,"according to the reports. Reports note that Dr. Aquino bought Parkway in 2005, a month later, placed the hospital under bankruptcy protection after inability to pay its debt. As reported in the Troubled Company Reporter on Aug. 9, 2007, the Honorable Prudence Carter Beatty of the U.S. Bankruptcy Court for the Southern District of New York confirmed Parkway Hospital's first amended plan of reorganization. About Parkway Hospital The Parkway Hospital Inc. operates a 251-bed proprietary, acute care community hospital located in Forest Hills, New York. The Company filed for chapter 11 protection on July 1, 2005 (Bankr. S.D.N.Y. Case No. 05-14876). Timothy W. Walsh, Esq., at DLA Piper Rudnick Gray Cary US LLP, represents the Debtor in its restructuring efforts. The Trumbull Group, nka Wells Fargo Trumbull, serves as the Debtor's claims agent. The firm of Alston & Bird LLP serves as substitute bankruptcy counsel to the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed $28,859,000 in total assets and $47,566,000 in total debts. PEACHTREE FRANCHISE: Fitch Holds 'B/DR1' Rating on Class B Notes ---------------------------------------------------------------- Fitch Ratings has affirmed the ratings on Peachtree Franchise Loan Notes, series 1999-A, as: -- Class A-X affirmed at 'BBB+'; -- Class A-2 affirmed at 'BBB'; -- Class B affirmed at 'B/DR1'; -- Class C remains at 'CC/DR5'; -- Classes D and E remain at 'C/DR6'. Fitch's analysis incorporated anticipated losses on defaulted and specially serviced collateral given the servicer's and Fitch's recovery expectations. Fitch's recovery expectations are based on historical collateral-specific recoveries experienced in the franchise Asset Backed Securities sector. The resulting anticipated collateral losses were then applied to the transaction structure, enabling Fitch to assess the impact of the losses on the securities and available credit enhancement. As a result of the aforementioned analysis, credit support was found to be consistent with Fitch's previous review resulting in the affirmation of the current ratings. PELL CITY: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Pell City Industrial Services, Inc. P.O. Box 469 Pell City, AL 35125 Bankruptcy Case No.: 08-40445 Type of Business: The Debtor owns and operates a machine shop that is engaged in general machining, steel fabricating, engineering & design services. It also provides tapping services, laser services, bending services, grinding services, shot blasting services, polishing services, flame cutting services, laser cutting services and plasma cutting services. Chapter 11 Petition Date: March 6, 2008 Court: Northern District of Alabama (Anniston) Judge: James J. Robinson Debtor's Counsel: Tameria Shaye Driskill, Esq. (tamerialaw@bellsouth.net) P.O. Box 8505 246 South 8th Street Gadsden, Al 35902 Tel: (256) 546-5591 Fax: (256) 546-6557 Estimated Assets: Less than $50,000 Estimated Debts: $1 million to $10 million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Crane Works Inc. Trade debt $211,563 P.O. Box 11407 Birmingham, AL 35246 Siskin Steel & Supply Co. Trade debt $143,035 P.O. Box 933517 Atlanta, GA 31193-3517 Nes Rentals Trade debt $117,786 P.O. Box 8500-1226 Philadelphia, PA 19178-1226 Tel: (888) 637-8008 Garrison Steel Fabricators, Trade debt $95,646 Inc. Allied Crawford (Attalla), Trade debt $84,253 Inc. Chapel Steel Co. Trade debt $67,688 United Bolt Co. Trade debt $67,038 NAMASCO Trade debt $59,406 Browning Enterprise, Inc. Trade debt $52,656 Essex Crane Rental Corp. Trade debt $46,777 Macsteel Service Centers USA Trade debt $45,998 Alabama Welding Supply Co. Trade debt $45,535 Industrial Galvanizers Trade debt $44,323 Birmingham American Business Finance, LLC Trade debt $38,844 Chatham Steel Corp. Trade debt $36,504 IKG Industries Trade debt $36,139 Tennessee Galvanizing, Inc. Trade debt $32,954 Ejcon Corp. Trade debt $32,200 Sunbelt Rentals Trade debt $30,081 Morgan Trucking, LLC Trade debt $26,065 PFP HOLDINGS: Wants to Employ Odyssey Capital as Financial Advisor ------------------------------------------------------------------ P.F.P. Holdings Inc. and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Arizona to employ Odyssey Capital Group LLC as financial advisor. The Debtors relate that they have an ongoing and immediate need for financial advisory, investment banking, and restructuring services to assist them in preserving and maximizing value for their estates and their creditors. Odyssey Capital will: a) familiarize the Debtors' business, operations, properties, financial condition, secured and unsecured debt, and prospects of the Debtors; b) review and analyze the Debtors' business plans and financial projections prepared by the Debtors; c) review and analyze the Debtors' liquidity position and assist the Debtors' management in identifying areas and means to improve and preserve the Debtors' liquidity; d) assist in the determination of a capital structure for the Debtors; e) assist in the determination of a range of values for the Debtors on a going concern basis; f) provide financial advice and assist the Debtors in developing and seeking approval of a restructuring plan in connection with a financial recapitalization or restructuring, sale transaction, or other transaction; g) advise the Debtors on the terms of new securities to be offered pursuant to any potential Plan; h) provide financial advice and assistance to the Debtors in any transaction constituting a sale; j) advise and assist the Debtors in evaluating potential financings involving the Debtors in connection with a transaction, including debtor-in-possession and exit financing, if the Debtors pursue a restructuring; j) attend meetings of the Debtors' Board of Directors and its committees; k) provide testimony, as necessary, with respect to matters as to which Odyssey has been engaged to advise the Debtors in any proceeding before the Court; l) be available to all members of the Debtors' board of directors; either individually or in groups, to assist them regarding the services to be provided by Odyssey; and m) perform such other services relating to the restructuring of the Debtors or the potential sale of their assets as requested by the Debtors. The Debtors tell the Court that they will pay a monthly financial advisory fee of $70,000, payable on the first day of each month, and a transaction fee of 1% of the amount of any transaction that is consummated by the Debtors. Of each monthly fee, $40,000 will be credited against the completion fee at the closing of a transaction. The Debtors add that they will pay for all reasonable and necessary expenses incurred in connection with this engagement. The Debtors further relate that they paid approximately $180,000 to Odyssey for pre-petition services in connection with their restructuring and related financial advisory services. To the best of the Debtors' knowledge, Odyssey is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. PFP Holdings Inc., is a homebuilder based in Phoenix, Arizona. The company does business under names including Trend Homes and Regency. Documents filed in Court indicate that the Debtor generated $309 million in revenue during 2007 while delivering almost 1,100 homes. PFP and its debtor-affiliates filed for separate Chapter 11 bankruptcy protection on Jan. 31, 2008, (Bankr. D. Ariz. Case No. 08-00899). Robert J. Miller, Esq., at Bryan Cave, L.L.P., represents the Debtor. Upon its bankruptcy filing, it listed $50 million to $100 million in estimated assets and debts. PINNACLE ENT: Profile Growth Prompts Fitch to Hold 'B' ID Rating ---------------------------------------------------------------- Fitch Ratings has affirmed Pinnacle Entertainment's Issuer Default Rating and upgraded PNK's subordinated notes as: -- Issuer Default Rating affirmed at 'B'; -- Bank facility affirmed at 'BB/RR1'; -- Subordinated notes upgraded to 'BB-/RR2' from 'B-/RR5'. The ratings apply to its $625 million bank credit facility and to $795 million of subordinated notes. The Rating Outlook is Stable. PNK's 'B' IDR reflects one of the most attractive growth profiles in the industry with the potential to more than double EBITDA in the next five years and meaningfully increase its diversification. The cost of that growth profile could mean more than $3 billion of capital spending contributing to significant negative free cash flow over that time. With a large amount of that spending expected to be funded by debt, PNK's credit metrics could deteriorate during the build out, which is reflected in its current IDR. Pinnacle's IDR benefits from a demonstrated willingness to issue equity to help fund its growth plans. It raised $732 million in net proceeds from four equity issues during 2004-2007. Pinnacle's growth beyond its River City project is currently constrained due to the state of the capital markets, which has curtailed the company's ability to raise capital to fund much of its development pipeline. However, the development pipeline is highly discretionary, so it has the ability to reduce project capex significantly and stage projects in order to smooth out development expenditures and give the company some financial flexibility. As a result, if the unfavorable capital markets environment continues, Pinnacle can delay new project development and potentially become free cash flow positive after opening River City next year, although that may be an unlikely scenario. The company's liquidity has become tighter while the capital markets are currently unaccommodating. But Pinnacle's current credit metrics are solid for the rating category and it has virtually no debt maturities until the credit revolver in 2010 while its first sub note doesn't mature until 2012. Based on Consolidated Adjusted EBITDA of $169.1 million in 2007, roughly $841 million in long-term debt, and gross interest expense of roughly $69 million as of Dec. 31, 2007, Pinnacle's leverage and coverage was 5.0x and 2.5x, respectively. As of February 29, 2008 PNK had $140 million drawn on its $625 million credit revolver, but full access is limited due to a $350 million senior debt limit covenant in one of its sub notes. Therefore, after about $20 million in letters of credit, Pinnacle has roughly $190 million of availability on its revolver, which is likely to be tapped over the next 12-18 months in order to complete the $375 million River City project next year. Pinnacle has already spent roughly $50 million on the project. In order to fund the remaining cash capital expenditures of $300 million ($25 million is capitalized interest), Pinnacle will use the $190 million in revolver availability, roughly $100 million in surplus cash, cash from operations (roughly $150 million in 2007), and hurricane insurance proceeds. Pinnacle recently agreed to a $36.75 million settlement with one of its insurance carriers, which is expected to be paid in March. Negotiations with two other carriers are ongoing. With the December 2007 opening of Lumiere Place in St. Louis, Pinnacle entered a new market, increasing the diversification of its cash flows. PNK's three Louisiana properties accounted for 71% of the company's Adjusted Property EBITDA in 2007. Fitch estimates that Louisiana concentration can drop to the 60% range in 2008 with a full year in St. Louis and could go to the 40% range after the full build out of its current development pipeline. Pinnacle's 'B' IDR incorporates potential capital structure changes due to its long-term development plans. However, the 'BB- /RR2' subordinated debt rating and 'BB/RR1' bank debt rating considers the recovery prospects on each class of debt based on the capital structure as it stands now and are likely to be revised when the capital structure changes. Pinnacle's previous subordinated debt rating incorporated a high probability of refinancing some of the subordinated debt class in 2008, thereby reducing the recovery prospects of the subordinated debt class. The 8.25% sub notes due 2012 and the 8.75% sub notes due 2013 become callable in 2008 and have senior debt limit covenants of $475 million and $350 million, respectively. The 7.50% sub notes due 2015 have a $1.5 billion senior debt limit covenant and are not callable until 2011. Fitch continues to believe that Pinnacle will significantly change the current capital structure in order to fund its development plans once capital markets become more accommodating. However, the current state of the capital markets significantly lowers the probability of that occurring in the near-term. It is likely that the capital restructuring will involve renegotiating and expanding its credit facility, which could significantly increase Pinnacle's senior debt availability and degrade the position of the sub note holders. (With the current credit facility priced attractively at LIBOR+150, Pinnacle is likely to be patient in seeking new terms.) However, until that capital restructuring occurs, Fitch believes the recovery prospects are strong for the sub note holders, which is reflected in the 2-notch differential to 'BB-' from the IDR of 'B'. Fitch's recovery analysis for Pinnacle assumes $350 million is drawn on the $625 million credit revolver, which is the limit in the strictest sub debt indenture. Since that is the only debt that would have priority over the $795 million in sub notes, Fitch estimates strong recovery value in the 71%-90% range, which equates to an RR2 Recovery Rating and results in a 2-notch positive differential from the IDR. If Pinnacle increases its credit facility availability or otherwise gains access to additional senior debt, Fitch will revise the $350 million credit facility draw assumption in its analysis, which would likely result in a downgrade of the sub note rating. Fitch will subsequently publish a detailed report on Pinnacle's credit and recovery analysis. PRB ENERGY: Plans to Continue Operations Amid Bankruptcy Filing --------------------------------------------------------------- PRB Energy Inc. sought the protection of the U.S. Bankruptcy Court by filing a Chapter 11 petition for reorganization. The company intends to continue to conduct business while it devotes significant effort to resolve its liquidity problems, recapitalize, and develop a reorganization plan. PRB Energy also said it received notice from the American Stock Exchange that it does not meet certain continued listing standards, as set forth in section 1003 (a) (iv) of the AMEX Company Guide, which could jeopardize the Company's continued listing pursuant to Section 1009 of the AMEX Guide. The AMEX Guide requires, among other things, that an issuer has not sustained losses which are so substantial in relation to its overall operations or its existing financial resources, or its financial condition has not become so impaired that it appears questionable, in the option of the AMEX, as to whether the Company will be able to continue operation and meet its obligations as they mature. The notice letter stated that the company must submit a plan to the AMEX by March 14, 2008, advising the AMEX of the action that it has taken, or that it will take, to bring the company into compliance with all the continued listing standards of the AMEX Guide by May 28, 2008. Settle Default Disputes with Senior Lenders As reported in the Troubled Company Reporter on March 4, 2008, PRB Energy was working with senior lenders that hold the company's $15 million Senior Secured Debentures due Aug. 31, 2008. The Debtor intended to satisfy its future obligation and to settle a dispute of whether any default has occurred and whether a redemption has occurred, as asserted by the senior lenders. The company, however, does not believe that a default under the Debentures has occurred. Given its negative working capital position and the senior lenders' assertion that it is in default, the company is exploring all of the strategic alternatives available to it under applicable law, including filing for bankruptcy protection. Lenders Notice of Default The TCR said on Feb. 29, 2008, that 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. The notice claimed 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. The notice also claimed that the company failed to take all actions necessary to maintain title to certain of the collateral securing its obligations under the Debentures. The notice also notified the company that as a remedy for the alleged defaults, an automatic redemption by the company of the Debentures has occurred. About PRB Energy Headquartered in Denver, PRB Energy, Inc., formerly PRB Gas Transportation Inc., -- http://www.prbenergy.com/-- operates as independent energy companies engaged in the acquisition, exploitation, development and production of natural gas and oil. In addition, the company and its affiliates provide gas gathering, processing and compression services for properties it operates and for third-party producers. They conduct business activities in Wyoming, Colorado and Nebraska. The Debtor filed for chapter 11 protection on March 5, 2008 (Bankr. D. Co. Case No. 08-12658) together with two affiliates, PRB Oil & Gas Inc. (Case No. 08-12661) and PRB Gathering Inc. (08- 12663). James T. Markus, Esq., at Block, Markus & Williams LLC represents the Debtors in their restructuring efforts. The Debtors listed assets between $50 million and $100 million and liabilities between $10 million and $50 million. They owe at least $1 million each to four unsecured creditors. * * * 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. PROPEX INC: Committee Wants FTI Consulting as Financial Advisor --------------------------------------------------------------- The Official Committee of Unsecured Creditors of Propex Inc. and its debtor-affiliates seeks authority from the U.S. Bankruptcy Court for the Eastern District of Tennessee to retain FTI Consulting, Inc., as its financial advisors, effective as Jan. 31, 2008. Stephen Cooke, chairperson of the Creditors Committee, relates that they selected FTI because the firm has a lot of experience in providing financial advisory services in restructurings and reorganizations in large and complex Chapter 11 cases on behalf of debtors and creditors throughout the United States. Mr. Cooke points out FTI's services are necessary to enable the Creditors Committee to assess and monitor the efforts of the Debtors and their professional advisors to maximize the value of their estates and to reorganize successfully. As the Creditors Committee's financial advisors, FTI will: * assist the Creditors Committee in the review of financial related disclosures required by the Court, including the Schedules of Assets and Liabilities, the Statement of Financial Affairs and Monthly Operating Reports; * assist the Creditors Committee with information and analyses required pursuant to the Debtors' DIP financing; * assist and advice the Creditors Committee with respect to the Debtors' identification of core business assets and the disposition of assets or liquidation of unprofitable operations; * review the Debtors' performance of cost or benefit evaluations with respect to the affirmation or rejection of various executory contracts and leases; * evaluate the present level of operations and identification of areas of potential cost savings, including overhead and operating expense reductions and efficiency improvements; * review the financial information distributed by the Debtors to creditors and others; * attend meetings and assist in discussions with the Debtors, potential investors, banks, other secured lenders, the Creditors Committee and any other official committees organized in the Chapter 11 proceedings, the United States Trustee, other parties in interest; * review and prepare information and analysis necessary for the confirmation of a plan in these chapter 11 proceedings; * assist in the valuation of the business and review of capital structure alternatives; * assist in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers; and * render all other general business consulting or assistance as the Creditors Committee or its counsel may deem necessary that are consistent with the role of a financial advisor and not duplicative of services provided by other professionals in this proceeding. For its services, FTI will be paid: (1) a fixed monthly rate of $150,000 for the first three months of the bankruptcy cases; (2) $125,000 per month thereafter; plus (3) a completion fee payable of $1,000,000, at the option of the Creditors Committee, upon the occurrence of the effective date of a Chapter 11 Plan of Reorganization. In addition, FTI will be reimbursed for actual and necessary expenses it has incurred or will incur, including any legal fees related to the firm's retention and defense of fee applications in the Debtors' cases. Steven Simms, Esq., a partner at FTI, assures the Court that his firm is a "disinterested person," as the term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It is produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on Jan. 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The debtors' has selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. As of Sept. 30, 2007, the debtors' balance sheet showed total assets of $585,700,000 and total debts of $527,400,000. The Debtors' exclusive period to file a plan of reorganization expires on May 17, 2008. (Propex Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) REAL MEX: Moody's Junk Corp. Family Rating on Liquidity Concerns ---------------------------------------------------------------- Moody's Investors Service downgraded Real Mex Restaurants, Inc.'s Corporate Family Rating to Caa1 from B3 and the $105 million senior secured notes to B1 from Ba3. Its Speculative Grade Liquidity rating remains SGL-4 and the rating outlook stays negative. The downgrade of the Corporate Family Rating to Caa1 reflects Moody's belief that on a run-rate basis Real Mex's credit metrics are more indicative of a Caa rating and will likely remain weak over an extended period, driven by its expected sub-par operating performance over the next twelve to eighteen months. Moody's expects the challenging operating environment experienced by the company in 2007, such as mounting cost pressures as well as soft guest traffic patterns, will likely persist. The action also reflects Moody's concern about the company's liquidity as it approaches a potential covenant violation. Absent a substantial improvement in its cash flow generation and/or a restructuring of its debt load, Moody's expects that the company will face significant challenges in meeting its financial covenants under various existing credit agreements throughout the next twelve months. "Real Mex's leverage is inherently high post its 2006 recapitalization and could become higher if its cash flow were to deteriorate further as it's going through a difficult time," said Moody's analyst, John Zhao. "A potential restructure of its balance sheet is likely in the intermediate term per our view, in which case the ratings could be revisited." The negative outlook encompasses the ongoing challenges in the current operating environment and Real Mex's limited prospects for a near-term rebound in performance. The outlook also reflects concern regarding the company's liquidity position as well as uncertainty surrounding its capital structure. The SGL-4 continues to reflect the company's weak liquidity profile, highlighted by Moody's anticipation of continued weak free cash flow and very tight cushion, if at all, under its financial covenants and its senior secured and unsecured bank credit agreements as well as the company's limited access to its revolving credit facility. Moody's notes, that the company's ability to remain in compliance with its financial covenants over the next twelve months is uncertain. The continued weak operating performance may force the company to seek a waiver or amendment from its lenders to avoid a covenant breach. Ratings downgraded with a negative outlook: Real Mex Restaurants, Inc. -- Corporate Family Rating to Caa1 from B3 -- Probability of Default Rating to Caa1 from B3 -- $105 million senior secured notes to B1 (LG2-15%) from Ba3 (LGD2-14%) Real Mex Restaurants, Inc., headquartered in Cypress, California, is a leading Mexican-themed restaurant chain operator that owns, operates and franchises casual dining restaurants primarily under the El Torito, Chevys Fresh Mex and Acapulco Mexican Restaurant concepts. At Sept. 30, 2007, Real Mex operated 188 restaurants of which 156 were located in California and the remainder were located in 12 other states. Total revenues for twelve months ending Sept. 30, 2007 were approximately $571 million. REGAL ENT: Prices Debt Offering of $190 Mil. Convertible Sr. Notes ------------------------------------------------------------------ Regal Entertainment Group disclosed the pricing of its offering of $190 million aggregate principal amount of convertible senior notes due 2011 to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933. The notes that will bear interest at a rate of 6.25% per annum, will initially be convertible into Regal's class A common stock at a conversion price of $23.03 per share and will rank on parity with all of its other existing and future senior indebtedness. The initial conversion price represents an 18% percent premium over the last reported sale price of Regal's class A common stock on March 4, 2008, which was $19.52 per share. On or after Dec. 15, 2010, the notes are convertible at any time before the maturity date. The notes are convertible prior to Dec. 15, 2010 only if: (1) during any calendar quarter after June 30, 2008 if the last reported sale price of Regal's class A common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of the preceding calendar quarter is more than 130% of the conversion price, (2) during the five consecutive business-day period after any ten consecutive trading-day period in which the trading price per $1,000 principal amount of notes was less than 95% of the product of the last reported sale price per share of class A common stock and the conversion rate for each day of the ten trading-day measurement period, or (3) during specified periods if specified distributions to holders of the company's common stock are made or specified corporate transactions occur. Regal has also granted the initial purchasers of the notes a 13-day option to purchase up to an additional $20 million principal amount of the notes. The sale of the notes is expected to close on March 10, 2008. Regal estimates that the net proceeds from this offering will be approximately $184.2 million after deducting estimated discounts and expenses. Regal intends to use approximately $6.3 million of the net proceeds of the offering to pay the net cost of convertible note hedge and warrant transactions. Regal intends to use the remaining net proceeds from the offering for general corporate purposes, which Regal expects will include the repurchase of all or a portion of its outstanding 3 3/4% convertible senior notes due 2008 or the repayment of the principal amount of those notes at maturity. Regal may acquire the 3 3/4% notes through open market purchases, privately negotiated transactions or conversions. In connection with the offering, Regal intends to enter into a convertible note hedge transaction with an affiliate of one of the initial purchasers. Regal also intends to sell warrants to the option counterparty. The convertible note hedge transaction is intended to reduce potential dilution with respect to Regal's class A common stock upon conversion of the notes. However, the warrant transaction could have a dilutive effect on Regal's earnings per share to the extent that the price of its class A common stock exceeds the strike price of the warrants. The warrant transaction will be accounted for as an adjustment to shareholders' equity. Regal expects that holders of its 3 3/4% notes from whom Regal may repurchase such notes may have outstanding short hedge positions in Regal's class A common stock relating to the 3 3/4% notes. Upon repurchase, Regal expects that such holders will unwind or offset those hedge positions by purchasing class A common stock in secondary market transactions, including purchases in the open market, or entering into various derivative transactions with respect to the class A common stock at the time of the pricing of the notes offered in the private placement. These activities could have the effect of increasing, or preventing a decline in, the price of the class A common stock concurrently with or shortly after the pricing of the notes in the private placement offering. About Regal Entertainment Headquartered in Knoxville, Tennessee, Regal Entertainment Group (NYSE:RGC) -- http://www.regalentertainmentgroup-- is the parent company of Regal Entertainment Holdings Inc., which is the parent company of Regal Cinemas Corporation and its subsidiaries. The company operates theatre circuit in the United States, consisting of 6,388 screens in 527 theatres in 39 states and the District of Columbia, as of Dec. 27, 2007, with over 242 million annual attendees during the fiscal year ended Dec. 27, 2007. Regal operates multi-screen theatres and has an average of 12.1 screens per location. It develops, acquires and operates multi-screen theatres primarily in mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout the United States. REGAL ENT: S&P Changes Outlook to Stable; Maintains 'BB-' Rating ---------------------------------------------------------------- Standard & Poor's Rating Services affirmed its ratings on Regal Entertainment Group, including the 'BB-' corporate credit rating, and revised the outlook to stable from negative. S&P analyzes parent holding company Regal Entertainment Group and its subsidiary, Regal Cinemas Corp., on a consolidated basis. "The outlook revision is based on modestly positive financial policy trends that help alleviate our previous concerns about debt-financed shareholder-friendly actions," explained Standard & Poor's credit analyst Tulip Lim. Lease-adjusted leverage has trended slightly downward over the last three years. S&P took this action despite the company's announcement two days ago that it intends to offer $190 million to $210 million of convertible senior notes, which S&P views as broadly neutral for credit metrics. Proceeds of these notes are likely to be used to purchase existing convertible notes or repay them at maturity, and could be used to settle any conversion of the notes. The rating reflects the mature nature of the U.S. movie exhibition industry amid expanding entertainment choices. The ratings also reflect the company's exposure to the fluctuating popularity of Hollywood films, relatively high leverage, and somewhat aggressive financial policies. Longer term, S&P is concerned that the proliferation of competing entertainment alternatives and shortening periods between theatrical release and home video and video-on-demand release will pressure movie attendance in the U.S. The company's geographically diverse and high-quality U.S. theater circuit, good profit margins, and positive discretionary cash flow partially mitigate these concerns. ROCK-TENN CO: Expands Business with Southern Container Buyout ------------------------------------------------------------- Rock-Tenn Company completed its acquisition of Southern Container Corp. With the acquisition, Rock-Tenn related that it became the eighth largest manufacturer of containerboard in North America, and continued as one of America's leading manufacturers of bleached and recycled paperboard with annual capacity of approximately 2.3 million tons of paperboard and containerboard, pro forma annual revenues of $2.9 billion and Pro Forma Adjusted EBITDA of $440 million for the 12 months ended Dec. 31, 2007. "With the acquisition of Southern Container we have completed another major step toward making Rock-Tenn the most respected and profitable integrated paperboard and packaging company in North America," James Rubright, Rock-Tenn chairman and chief executive officer, said. "We believe our very low cost mills and converting plants and reputation for exceptional product quality and service just got better with the acquisition of Southern Container." Rock-Tenn financed the acquisition with $1.4 billion in new financing, including $1.2 billion of new senior secured credit facilities and $200 million of 9.25% senior notes due 2016. Due to demand for the company's bank credit facilities, the company was able to increase the size of the senior secured credit facilities from $1.0 billion to $1.2 billion, and reduce the size of the senior notes offering from $400 million to $200 million, which based on current market rates results in a reduction of annual interest expense of approximately $7.5 million per year. Wachovia Bank N.A., Bank of America and SunTrust Bank and certain affiliates of each arranged the syndication of the $1.2 billion senior secured credit facilities. Wachovia Capital Markets LLC acted as financial advisor to Rock-Tenn on the transaction. Rock-Tenn disclosed that based on the pro forma combination of the 12 months ended Dec. 31, 2007, results for Rock-Tenn and the unaudited 52 weeks ended Dec. 29, 2007, results for Southern Container and preliminary purchase price allocation, pro forma combined net income and pro forma diluted income per share of combined Rock-Tenn was $95.2 million and $2.42 per share, and Pro Forma Adjusted EBITDA was $440.2 million, in each case higher than the $90.3 million, $2.29 per share and $429.6 million, for the 12 months ended Sept. 30, 2007. The pro forma net income per share of $2.42 for the combined Rock- Tenn for the 12 months ended Dec. 31, 2007, was $0.28 per share higher than Rock-Tenn's reported net income per share of $2.14 per share for the 12 months ended Dec. 31, 2007. About Southern Container Corp. Headquartered in Hauppauge, New York. Southern Container Corp. -- http://www.southern-container.com/-- is an independent manufacturer of corrugated boxes. The company designs and produces shipping containers, point-of-purchase displays, and other containers used by the food, beverage, cosmetic, and pharmaceutical industries, among others. It also provides related printing and graphic services. About Rock-Tenn Company Headquartered in Norcross, Georgia, Rock-Tenn Company (NYSE:RKT) - http://www.rocktenn.com/-- manufactures packaging products, paperboard and merchandising displays. The company has annual net sales of approximately $2.3 billion and operating locations in the United States, Canada, Mexico, Chile and Argentina. The company operates in four segments: packaging products, paperboard, merchandising displays, and corrugated packaging. * * * As reported in the Troubled Company Reporter on Feb. 26, 2008, Standard & Poor's Ratings Services said that ratings on Rock-Tenn Co. (BB+/Negative/--) are unaffected by the company's statement that it has increased the commitment under its term loan A by $200 million. RYLAND GROUP: Accused by Regulator of Dubious Lending Practices --------------------------------------------------------------- The Ryland Group Inc.'s mortgage unit is under scrutiny for questionable lending practices, Michael Corkery of The Wall Street Journal reports. Among others, the office of North Carolina banking commissioner accused Ryland Mortgage of employing unlicensed loan officers and charging exorbitant fees to homeowners, says WSJ. Ryland, according to WSJ, said that it will not admit wrongdoing. However the lender said that to avoid litigation in the future, it is willing to refund $250 to each of around 800 homeowners, and pay a $161,000 fine. "We do not believe that any North Carolina homebuyers were harmed or overcharged," WSJ quotes Ryland representative Marya Barlow as saying. Examiners averred that Ryland Mortgage charged excessive closing fees to recover the costs of discounts, banking commissioner Mark Pearce told WSJ. "My question is, did the borrower get a true discount in that transaction. . . . [I]t doesn't sound like much of a discount to me." About Ryland Group Based in Calabasas, California and founded in 1967, The Ryland Group, Inc. -- http://www.ryland.com/-- is one of the nation's leading builders of single family homes, currently operating in 28 markets across the United States, with homebuilding revenues and consolidated net income for the trailing 12 months ended Sept. 30, 2007 of approximately $3.5 billion and ($44) million, respectively. * * * As reported in the Troubled Company Reporter on Dec. 21, 2007, Moody's Investors Service lowered the ratings of The Ryland Group, Inc., including its corporate family rating and the ratings on the various issues of senior unsecured notes to Ba1 from Baa3. The ratings were taken off review for downgrade where they had been placed on Oct. 31, 2007, and the outlook is negative. S&A CORP: Court Approves Hiring of Orson Woodall as Legal Counsel ----------------------------------------------------------------- The United States Bankruptcy Court for the Middle District of Georgia authorized S. & A. Corporation of Clinton, doing business as Howard Johnson Express, to employ Orson Woodall, as bankruptcy counsel. The Debtor selected Mr. Woodall because of his considerable experience in bankruptcy related matters. The Debtor hired Mr. Woodall's firm under a general retainer. The Debtor expects Mr. Woodall to provide extensive legal services. The Debtor has paid Mr. Woodall $1,000 for services rendered pre- bankruptcy, and a $4,961 retainer has been paid to the counsel's escrow account. Mr. Woodall will bill at $250 an hour. Mr. Woodall attests that he does not represent any adverse interest to the estate. Valdosta, Georgia-based S. and A. Corporation of Clinton, doing business as Howard Johnson Express, sought chapter 11 bankruptcy protection February 4, 2008, before the U.S. Bankruptcy Court for the Middle District of Georgia (Valdosta) (Case No.: 08-70147). The Debtor reported $1 million to $100 million in estimated assets and debts when it filed for bankruptcy. S&A CORP: Sec. 341 Meeting of Creditors Set for March 13 -------------------------------------------------------- The United States Trustee for the Middle District of Georgia will convene a meeting of creditors of S. & A. Corporation of Clinton, doing business as Howard Johnson Express, on March 13, 2008, at 11:00 a.m. The meeting will be held at Room 257, U.S. Courthouse and Post Office, North Patterson Street, in Valdosta, Georgia. This is the first meeting of creditors required under Sec. 341 of the Bankruptcy Code. A representative of the Debtor will required to attend to be questioned under oath. Creditors are welcome to attend, but are not required to do so. The meeting may be continued and concluded at a later date without further notice. Valdosta, Georgia-based S. and A. Corporation of Clinton, doing business as Howard Johnson Express, sought chapter 11 bankruptcy protection February 4, 2008, before the U.S. Bankruptcy Court for the Middle District of Georgia (Valdosta) (Case No.: 08-70147). The Debtor reported $1 million to $100 million in estimated assets and debts when it filed for bankruptcy. S&A CORP: General Claims Bar Date Set for June 11 ------------------------------------------------- Creditors of S. & A. Corporation of Clinton, doing business as Howard Johnson Express, have until June 11, 2008, to file proofs of claim against or proofs of interest in the bankruptcy estate, according to a notice filed on Official Form 9F filed in the Debtor's case. Governmental units, however, have until Aug. 4 to file proofs of claim. The proof of claim must be received by the bankruptcy clerk's office: William E. Tanner Clerk of the Bankruptcy Court 901 Front Avenue P.O. Box 2147 Columbus, GA 31902 Telephone number (706) 6497837 Valdosta, Georgia-based S. and A. Corporation of Clinton, doing business as Howard Johnson Express, sought chapter 11 bankruptcy protection February 4, 2008, before the U.S. Bankruptcy Court for the Middle District of Georgia (Valdosta) (Case No.: 08-70147). The Debtor reported $1 million to $100 million in estimated assets and debts when it filed for bankruptcy. SHARPER IMAGE: Landlords Object to $60M DIP Financing Motion ------------------------------------------------------------ Several parties lodged objections to the US$60,000,000 debtor-in- possession financing Sharper Image Corp. obtained from Wells Fargo Retail Finance, LLC, as the arranger and administrative agent for the DIP Lenders. As reported in the Troubled Company Reporter on Feb. 28, 2008, the proceeds of the DIP Facility, net of any amounts used to pay fees, costs and expenses under the DIP Credit Agreement, will be used, solely for: (a) working capital and general corporate purposes, (b) payment of costs of administration of the Case, (c) all prepetition letters of credit issued under the Prepetition Financing Agreements will be deemed issued under the DIP Credit Agreement, and (d) payment in full of the Prepetition Debt. A full-text copy of the DIP Credit Agreement is available for free at http://bankrupt.com/misc/SIDIPFinancingPact.pdf The Debtor and Wells Fargo have agreed on a budget projecting cash flow for 13 weeks. On a weekly basis, the Debtor will provide to Wells Fargo an updated budget. The Debtor believes that the Budget is achievable and will allow it to operate and pay its postpetition obligations as they mature. A full-text copy of the 13-week budget is available for free at http://bankrupt.com/misc/SI13WeekBudget.pdf The U.S. Bankruptcy Court in Delaware has authorized the Debtor to borrow up to US$35,000,000 pursuant to the terms of the DIP Financing Agreement, pending a final hearing. Objections (A) EklecCo, Taubman, Westfield and Greenway Pursuant to the DIP financing agreement, the Debtor intends to grant Wells Fargo Retail Finance a security interest in the real property leased by the Debtor in EklecCo Newco, L.L.C.'s Palisades Center, in West Nyack, New York. Susan E. Kaufman, Esq., at Heiman, Gouge & Kaufman, LLP, in Wilmington, Delaware, relates that the Debtor cites no authority, and EklecCo believes no authority exists, for the proposed pledge of the Debtor's state law contractual rights. Therefore, Wells Fargo, as lender, has no right to enter into and occupy the Premises. Moreover, any proposed grant of a security interest in the Lease is essentially a de facto assignment of the Lease given the broad remedies granted to the Lender should there be a default. EklecCo and the Debtor are parties to the Lease, whereby the Lender is not, Ms. Kaufman notes. The Debtor is essentially asking the Court to create landlord and tenant relationship between non-debtor parties. "Any final order on the Financing Motion should prohibit the Lender from entering and using the Premises absent the express written consent of the Objecting Landlord or further court order," Ms. Kaufman adds. Accordingly, EklecCo asks the Court that any final order granting the Debtor's proposed DIP financing be modified pursuant to the terms of EklecCo's objection, or otherwise deny it in its entirety. The Taubman Landlords, by their counsel, Andrew S. Conway, Esq., joins EklecCo in objecting to the Debtor's proposed DIP financing for the same reasons disclosed. Westfield, LLC, and certain of its affiliates, and Greenway Center, LLC, a landlord of the Debtor for a retail store space at a shopping center in Middleton, Wisconsin joins EklecCo's objection. The Debtor is a tenant with regard to 10 unexpired leases of nonresidential real properties owned by the Westfield landlords. The Westfield Landlords are: Landlord Location -------- -------- Annapolis Mall Limited Partnership Annapolis, Maryland Citrus Park Venture Limited Partnership Tampa, Florida Westland Garden State Plaza Ltd. Partn. Paramus, New Jersey Hawthorn, L.P Vernon Hills, Illinois Horton Plaza LP San Diego, California Mainplace Shoppingtown LLC Santa Ana, California Montgomery Mall LLC Bethesda, Maryland Old Orchard Urban Limited Partnership Skokie, Illinois Santa Anita Shoppingtown LP Arcadia, California V F Mall LLC Santa Clara, California (B) The Macerich Company, et al. The Macerich Company, RREEF Management Company, Cousin Properties Incorporated, and The Forbes Company are the lessors under 16 leases of nonresidential real property with the Debtor for retail sales space in shopping centers located in Arizona, California, Colorado, Connecticut, Florida, Georgia, Michigan, Minnesota, New Jersey, and Oregon. Pursuant to the terms of the Interim DIP order, and as stated on the record at the February 20, 2008 hearing on the Debtor's first day motions, the final order on the Debtor's proposed DIP financing should also reflect that the DIP liens extend only to the proceeds of the leases, if ever a lien on the Leases is prohibited by applicable non-bankruptcy law, or the terms of the Leases themselves, Leslie C. Heilman, Esq., at Ballard Spahr Andrews & Ingersoll, LLP, in Wilmington, Delaware, states. Given the fact that the Landlords' shopping centers effectively house a substantial portion of retail -- the inventory subject to the DIP Liens -- neither the DIP secured parties nor their agents should be allowed to use or occupy any portion of the Premises as part of exercising their rights under the prepetition financing agreement or the DIP Financing Agreements without a Court order, after notice to the Landlords, and a hearing, Ms. Heilman relates. Accordingly, Macerich, et al. ask the Court to deny the Debtor's proposed DIP financing unless the protections requested are incorporated into the final form of order. In addition, Macerich, et al. also join in the objections of other real properly lessors. (C) BP 111 BP 111 Huntington Avenue LLC leases non-residential real property to the Debtor within the shopping center known as The Shoppes at the Prudential Center pursuant to a lease agreement dated February 26, 2003. BP 111 and the Debtor are also parties to two agreements for use and occupancy of storage space dated October 23, 2006 and November 19, 2007. The Debtor has not assumed or rejected the Lease or the Storage Agreements as of February 29, 2008. William D. Sullivan, Esq., at Sullivan Hazeltine Allinson LLC, in Wilmington, Delaware, states that the Debtor could not simply assume the Lease and the Storage Agreements and then assign them to third parties without first going before the Court and proving that it had provided BP 111 with the adequate assurance of future performance. "Whether or not the Debtor is in default of its obligations under the DIP Financing Agreement, in order for any third parties to obtain any rights in the Lease, the Debtor must appear before the Court and demonstrate that it has provided the Landlord with adequate assurances," Mr. Sullivan said. Mr. Sullivan notes that if an event of default occurs and the DIP lenders exercise their rights and remedies under the DIP financing agreement, then the DIP Lenders must timely comply with all of the Lease obligations until the date the Lease is assumed or rejected. Mr. Sullivan relates that BP 111's Lease prohibit the Debtor from granting a lien on its leasehold interest. Therefore, BP 111 reserves the right to enforce the prohibition in the Lease. Accordingly, BP 111 asks the Court that any final order authorizing the DIP Financing Agreement should prohibit the lien notwithstanding the terms of the DIP Financing Agreement. BP 111 also joins the objections filed by the Debtor's other landlords. (D) Stopen Stopen, LLC and the Debtor are parties to a lease of non- residential real property for a unit in a shopping center known as The Avenue of the Peninsula located in Rolling Hills Estates, California. In light of the Debtor's DIP motion, Jeffrey C. Wisler, Esq., at Connolly Bove Lodge & Hutz LLP, in Wilmington, Delaware, states that the Debtor has no right to place a lien on Stopen's Lease. Furthermore, the Avenue of the Peninsula's own financing prohibits Stopen from allowing any liens to be placed upon the Lease. "If any lien is placed, the Center's lender could demand that the lien be immediately paid and discharged," Mr. Wisler said. Mr. Wisler relates that granting a lien on the leasehold interests may result in a de facto assignment of the Lease to the DIP Lenders upon an occurrence of default under the DIP financing agreement. Additionally, section 9.1(j) of the DIP Financing Agreement provides that the DIP Lenders may sell the borrower collateral at either a public or private sale, or both, by way of one or more contracts or transactions, for cash or on terms, in a manner and at places as the agent determines is commercially reasonable. The Court cannot permit a lien that would authorize the DIP Lenders to become the assignee of, or foreclose upon, the Lease or the Debtor's leasehold interests in the Lease, Mr. Wisler points out. At most, the Court may permit the Debtor to grant the DIP Lenders liens upon the proceeds of the Debtor's leasehold interests, but only in a manner that assures landlords the protections of Section 365 of the Bankruptcy Code. Accordingly, Stopen asks the Court to deny the DIP Motion unless it is modified to eliminate any right of the Debtor to grant any lien on, or security interest in, the Lease. (E) Kravco and UBS Realty Kravco Simon Company and UBS Realty Investors, LLC, as agent for Century Square Limited Partnership, are the owners or agents for the owners of two shopping centers in which the Debtor operates retail stores. David L. Pollack, Esq., at Ballard Spahr Andrews & Ingersoll, LLP, in Philadelphia, Pennsylvania, states that Kravco's and UBS's leases prohibit the Debtor from assigning, transferring, mortgaging or otherwise encumbering the Leases. While Kravco and UBS do not object to the granting of a lien on and security interest in the proceeds of the sale or other disposition of their Leases, they do object to any attempt to grant a security interest in, mortgage or otherwise hypothecate the Leases, contrary to the provisions. Kravco and UBS further object to any use of their leaseholds except as provided in the Leases or pursuant to a further order of the Court. Moreover, no liens whatsoever should be granted on Kravco's and UBS's Leases. In addition to the strict prohibition in most leases against the granting of liens on the leasehold interests, one or both of the subject properties may be encumbered by mortgages which specifically prohibit the landlord from allowing any encumbrances to be granted upon the various tenant leases. Mr. Pollack relates that neither the Debtor nor the lenders have cited any authority which would allow the Court to override the prohibitions in the leases against granting liens -- for the simple reason that no authority exists. Kravco and UBS are entitled to have the prohibitions in their Leases fully enforced by the Court. Kravco and UBS, hence, ask the Court to deny the DIP Motion unless it is modified. (F) Inland Inland Southwest Management, LLC is the managing agent for Town Square Ventures, L.P. and the premises located in Southlake Town Square in Southlake, Texas, that Town Square leases to the Debtor. Christina M. Thompson, Esq., at Connolly Bove Lodge & Hutz LLP, in Wilmington, Delaware, states that Inland objects to the granting of any lien by the Debtor on the Lease as requested in the DIP motion. The Premises are subject to a mortgage and other financial agreements, which may prohibit Inland from allowing any liens, including prepetition replacement liens, to be placed upon the Premises and the Lease, Ms. Thompson relates. "The Debtor should not be able to grant any liens on the leaseholds to the detriment of Inland and its mortgagees, especially if the liens would supersede any existing mortgage liens granted by Inland to its mortgagees or other parties," Ms. Thompson said. Although the interim DIP order provides that the DIP Lenders only receive a lien on leases of real property to the extent not prohibited by applicable non-bankruptcy law or by the express terms of a lease, this exception is not sufficient because it permits the Debtor and the DIP Lenders to decide whether the Lease or applicable law prohibit the granting of a lien, Ms. Thompson explains. Instead, the Court should permit the Debtor to grant liens only upon the proceeds of the Debtor's leasehold interests, Ms. Thompson notes. Moreover, the Debtor has failed to present any facts or evidence that suggests why, precisely, a lien upon the proceeds of the Debtor's leasehold interests is not sufficient in this case. If a lien on the Lease is permitted, a de facto assignment of the Lease will result upon an occurrence of default under DIP Agreement. The Lease expressly prohibits any assignment of the Lease without Inland's prior consent. Ms. Thompson further asserts that any foreclosure by the DIP Lenders on the leasehold interests would circumvent the express requirements for assumption and assignment of the Lease. Ms. Thompson argues that the Debtor has cited no authority for circumventing the protections that are afforded to landlords by Section 365 of the Bankruptcy Code and the heightened requirements contained therein with respect to assignments of shopping center leases in order to benefit the Debtor's lenders. Accordingly, any final Court order that would permit a lien on the Debtor's leasehold interest (i) must expressly prohibit the DIP Lenders from entering and occupying the Premises, (ii) must expressly require the DIP Lenders to comply with all provisions of the Lease including, but not limited to, the full and timely payment of rent, and (iii) must expressly require that the DIP Lenders comply with all provisions of the Bankruptcy Code pertaining to, among other things, the assignment of the Lease. (G) Chagrin Chagrin Retail, LLC, leases non-residential real property to the Debtor within Eton Chagrin Boulevard, Woodmere Village, Ohio. Tiiara N. A. Patton, Esq., at Calfee, Halter & Griswold LLP, in Cleveland, Ohio, relates that Chagrin opposes the relief requested in the DIP Motion because it appears that the Lender is to be granted a security interest in the Lease pursuant to the DIP Financing Agreements. Ms. Patton states that the Debtor cites no authority for the proposed pledge of the Debtor's state law contractual rights. Therefore, the Lender has no right to enter and occupy the Premises. Moreover, any proposed grant of a security interest in the Lease is essentially a de facto assignment of the Lease given the broad remedies granted to the lender should there be a default. Section 365(b)(3) of the Bankruptcy Code requires that assumption or assignment of a lease be subject to all the provisions of a lease. Ms. Patton further states that the Lease Agreement does not permit the Debtor's pledge of its leasehold interest or assignment of the interest without the Chagrin's consent. Chagrin and the Debtor are parties to the Lease, whereby the Lender is not. The Debtor is essentially asking the Court to create landlord and tenant relationship between non-debtor parties, Ms. Patton relates. (H) Texas Tax Authorities The local Texas tax authorities in Bexar County, Cypress- Fairbanks ISD, Dallas County, Fort Bend County, Harris County, Montgomery County, Sugar Land, and Tarrant County, have filed secured claims aggregating $119,000 against the Debtor for unpaid 2007 and 2008 ad valorem property taxes. The claims of the Local Texas Tax Authorities are secured by first priority liens on the Debtor's personal property. Elizabeth Weller, Esq., at Linebarger Goggan Blair & Sampson, LLP, in Dallas, Texas, states that the tax lien takes priority over the claim of any holder of a lien on property encumbered by the tax lien, whether or not the debt or lien existed before the attachment of the tax lien. "The Tax Authorities liens should not be subordinated or primed, and their liens being senior to those of the prepetition and DIP lenders, the Tax Authorities claims should be paid in full prior to any proceeds being released to other parties," Ms. Weller says. The Local Texas Tax Authorities ask the Court to deny the Debtor's DIP Motion until appropriate provisions are included to adequately protect the priority of the liens of the Local Texas Tax Authorities and their interest in the proceeds from the sale of their collateral. General Growth et al. Files Reservation of Rights General Growth Properties, Inc., Developers Diversified Realty Corp., Turnberry Associates, and Weingarten Realty Investors have informally raised with the Debtor various related issues, and worked with the Debtor on certain language to incorporate clarifications from the first day hearing into the final DIP order and resolve any other issues. Robert R. LeHane, Esq., at Kelley Drye & Warren LLP, in New York, relates that General Growth et al. believe their concerns have been substantially resolved and that the parties will reach agreement on consensual language for the final DIP order. However, they have not received confirmation that the Debtor and Lenders have agreed to all of their proposed language prior to their objection deadline. Out of an abundance of caution, General Growth et al. reserve their rights to be heard at the final hearing in connection with the DIP Motion in the event that the parties are unable to reach agreement on consensual language for the final DIP order. About Sharper Image Corp. Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An official Committee of Unsecured Creditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of$251,500,000 and total debts of $199,000,000. (Sharper Image Bankruptcy News Issue No. 5, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). SHARPER IMAGE: Wants to Employ Conway Del Genio as Managers ----------------------------------------------------------- Sharper Image Corp. seeks the authority of the United States Bankruptcy Court for the District of Delaware to employ Conway, Del Genio, Gries & Co., LLC to provide restructuring management services. The Debtor also seeks to employ Robert P. Conway as its chief executive officer, as of the Petition Date, pursuant to a letter agreement dated February 12, 2008. The Debtor's proposed counsel, Steven K. Kortanek, Esq., at Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware, relates that the Debtor selected CDG and Mr. Conway because of their vast experience in providing restructuring management services to financially troubled organizations. Moreover, the Debtor believes that the restructuring management services provided by CDG and the appointment of Mr. Conway as CEO are necessary to enable the Debtor to maximize the value of its estate and enhance its ability to successfully reorganize and are therefore in the best interests of its estate. Mr. Kortanek states that CDG will manage all aspects of the Debtor's Chapter 11 case leading to a possible refinancing, restructuring, or modification of any or all of the Debtor's existing debt, other obligations, or equity. In addition, CDG will manage the Debtor's day-to-day operations including business strategy, supplier relationships, expansion or contraction of the retail footprint, and all employee related matters. As the Debtor's restructuring managers, CDG will: * gather and analyze data, interview appropriate management and evaluate the Debtor's existing financial forecasts and budgets to determine the extent of the Debtor's financial challenges; * review the Debtor's current liquidity forecast and assist management in modifying and updating the forecasts based upon current information, CDG's observations and other information as it becomes available; * assist the Debtor in the development of a business plan, which would be shared with creditors, partners, and investors in discussions concerning a potential restructuring of some or all of the Debtor's current indebtedness, obligations or liabilities; * provide financial advice and assistance to the Debtor in structuring and effecting a financing, identify potential lenders and, at the Debtor's request, contact lenders; * assist the Debtor in developing and preparing evaluation materials for potential lenders; * lead negotiations with potential lenders; * assist the Debtor in the preparation, design, and presentation of a formal Restructuring proposal to accompany the business plan; * provide financial advice and assistance to the Debtor in structuring any new securities to be issued under the proposal; * lead negotiations with entities or groups affected by the proposal; * make CDG personnel available to serve as officers of the Debtor; * participate in the Debtor's board meetings as appropriate, and provide periodic status reports and advice with respect to the presentation of any proposals; and * perform other services and analyses relating to the restructuring effort. As chief executive officer, Mr. Conway and other CDG personnel made available to serve as officers of the Debtor will be responsible for day-to-day executive management and operational issues of the Debtor, including but not limited to: * addressing any and all operational issues as they arise; * managing all supplier relationships; * implementing operational changes including store openings and closings; * managing inventory purchasing and the supply of merchandise to the Debtor's stores; * addressing promotional and advertising strategies and determining the appropriate strategy for the Debtor's business going forward; * implementing any necessary supply chain changes; and * addressing all employee related matters. CDG will be paid $150,000 monthly. Also, CDG will be reimbursed monthly for its reasonable out-of-pocket expenses. If the Debtor is restructured or its debt refinanced, or if a substantial portion of its stock or assets are sold, CDG will receive, without duplication a fee equal to 1% of the amount of the obligation restructured, the new debt raised in the financing, and the consideration received in the sale. CDG is entitled to indemnity. However, CDG will not be entitled to indemnification, other than to the fullest extent that the CDG employees and principals serving the Debtor as officers may be entitled under the Bylaws of the Debtor and applicable law. CDG employees serving the Debtor will also be entitled to coverage under the Debtor's D & 0 insurance policies. Robert P. Conway Esq., a partner at CDG, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Sharper Image Corp. Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of Unsecured Creditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News Issue No. 5, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Wants to Employ Weil Gotshal as Lead Counsel ----------------------------------------------------------- Sharper Image Corp. seeks the authority of the United States Bankruptcy Court for the District of Delaware to employ Weil, Gotshal & Manges LLP as its attorneys to perform the extensive legal services that will be necessary during the Debtor's Chapter 11 case. According to Rebecca L. Roedell, executive vice president and chief financial officer of Sharper Image, the Debtor selected WG&M because of the firm's extensive general experience and knowledge and, in particular, its recognized expertise in the field of debtor's protections, creditors' rights and business reorganizations under Chapter 11 of the Bankruptcy Code. Ms. Roedell further relates that WG&M has become familiar with the Debtor's business, affairs, and capital structure because prior to the Petition Date, in February 2008, WG&M has provided assistance and advice to the Debtor with respect to formulating, evaluating, and implementing various restructuring, reorganization, and other strategic alternatives. Also, WG&M assisted and advised the Debtor in connection with the preparation for the Chapter 11 case. WG&M will represent the Debtor in coordination with Womble Carlyle Sandridge & Rice, PLLC. WG&M and Womble have discussed a division of responsibilities in connection with representation of the Debtor and will make every effort to avoid and minimize duplication of services in the representation of the Debtor, Ms. Roedell adds. As the Debtor's attorneys, WG&M will: * take all necessary or appropriate actions to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, and more; * prepare on behalf of the Debtor, all necessary or appropriate motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtor's estate; * negotiate and prepare on behalf of the Debtor any Plan of Reorganization and all related documents; and * perform all other necessary legal services in connection with the Chapter 11 case. The Debtor propose to pay WG&M its customary hourly rates for services rendered that are in effect from time to time and to reimburse WG&M according to its customary reimbursement policies. Ms. Roedell notes that a year before the Petition Date, the Debtor provided advances aggregating $400,000 to WG&M for services to be performed and expenses incurred and to be incurred in connection with services to be provided by WG&M, including the commencement and prosecution of the Chapter 11 case. As of the Petition Date, the fees and expenses incurred by WG&M and debited against the amounts advanced to it by the Debtor approximated $376,054. The precise amount will be determined upon the final recording of all time and expense charges. Accordingly, as of the Petition Date, WG&M had a remaining credit balance in favor of the Debtor in the approximate amount of $23,946 for additional professional services performed and to be performed and expenses incurred and to be incurred in connection with the Chapter 11 case. After application of amounts for payment of any additional prepetition professional services and related expenses, the excess advance amount will be held by WG&M for application to and payment of postpetition fees and expenses that are allowed by the Court. Harvey R. Miller, Esq., a partner at WG&M, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Sharper Image Corp. Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of Unsecured Creditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News Issue No. 5, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Wants to Employ Womble Carlyle as Co-Counsel ----------------------------------------------------------- Sharper Image Corp. seeks the authority of the United States Bankruptcy Court for the District of Delaware to employ Womble Carlyle Sandridge & Rice, PLLC as its counsel, effective as of Feb. 19, 2008. Rebecca L. Roedell, executive vice president and chief financial officer of Sharper Image, states that the Debtor selected Womble Carlyle because of its extensive experience and knowledge of bankruptcy matters and the Court's Local Rules and practices. Ms. Roedell relates that the Debtor is seeking to retain Womble Carlyle to serve as co-counsel with Weil, Gotshal & Manges LLP in connection with the Debtor's Chapter 11 case. In order to avoid any duplication of efforts, Womble Carlyle and WG&M have discussed each firm's responsibilities in connection with representation of the Debtor, Ms. Roedell adds. Moreover, to the extent that any conflicts arise that impair WG&M's ability to act as counsel to the Debtor on a given matter, the Debtor may call upon Womble Carlyle to act as special conflicts counsel. As co-counsel to the Debtor, Womble Carlyle will: * provide legal advice regarding the rules and practices of the Court applicable to the Debtor's powers and duties as a debtor-in-possession under the Bankruptcy Code; * take all necessary or appropriate actions to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the Debtor's estate; * prepare on behalf of the Debtor, all necessary or appropriate motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtor's estate; * negotiate and prepare on behalf of the Debtor, any Plan of Reorganization and all related documents; and * perform all other necessary legal services in the Chapter 11 case. In exchange for the contemplated legal services, Womble Carlyle will be paid based on its applicable hourly rates: Professional Hourly Rate ------------ ----------- Attorney $120 to $750 Paraprofessionals $30 to $450 Steven K. Kortanek, Esq., a member of Womble Carlyle whose current hourly rate is $450, will be primary responsibility for providing legal services to the Debtor. Womble Carlyle paraprofessionals and legal assistants will provide additional supporting legal services on behalf of and as directed by the Debtor and WG&M. Ms. Roedell states that Womble Carlyle received a $40,000 retainer from the Debtor as security for payment of the firm's fees and expenses for professional services to be performed relating to the preparation for and prosecution of the Chapter 11 case. Prior to the Petition Date, Womble Carlyle incurred a total of $19,341 in fees and expenses which was paid prepetition from the Retainer. As to the Petition Date Retainer balance, Womble Carlyle's retention terms with the Debtor provide for maintaining the Retainer on an "evergreen" basis, which would not be applied to postpetition fees and expenses of the firm until the conclusion of the firm's engagement. Steven K. Kortanek, Esq., a partner at Womble Carlyle, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Sharper Image Corp. Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of Unsecured Creditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News Issue No. 5, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) SHARPER IMAGE: Director Steven A. Lightman Resigns -------------------------------------------------- In a regulatory filing with the U.S. Securities and Exchange Commission, James M. Sander, senior vice president and general counsel of Sharper Image Corp., reports that Steven A. Lightman, a member of the board of directors of Sharper Image, informed them on February 28, 2008, that he is resigning from the board, effective immediately. Mr. Sander relates that Mr. Lightman's resignation is not the result of a disagreement with the Company on any matter relating to the Company's operations, policies or practices. About Sharper Image Corp. Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of Unsecured Creditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News Issue No. 5, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) SIRVA INC: Triple Net Seeks Appointment of Class 5 Committee ------------------------------------------------------------ Triple Net Investments IX, LP, asks the U.S. Bankruptcy Court for the Southern District of New York to (i) appoint an Official Committee of Unsecured Creditors for Class 5 Claimants of Sirva Inc. and its debtor-affiliates, and to (ii) stay all proceedings pending the appointment of the Class 5 Committee. Triple Net Investments IX, LP, holds a claim against one of the Debtors, North American Van Lines, Inc. According to Triple Net, there is an inherent and irreconcilable conflict of interest in having one law firm represent, as part of the Official Committee of Unsecured Creditors, the interests of both Class 4 and Class 5 claimants under Debtors' proposed plan of reorganization. The Class 5 Claimants of the Debtors are those that hold General Unsecured Claims. Class 4 consists of all Unsecured Ongoing Operations Claims. Robert E. Nies, Esq., at Wolff & Samson PC, in New York, relates that two Class 4 members in the Committee have already been paid in full, or will be paid in full upon confirmation of the Plan. On the other hand, Class 5 claimants will receive nothing, Mr. Nies explains. The counsel representing Class 4's interests cannot advocate for Class 5 claimants without jeopardizing Class 4's guaranteed recovery. Mr. Nies submits that committee members often have varying interests in a bankruptcy case, and often disagree over the committee's strategic objectives. However, he argues that the Class 4 claimants, who are unimpaired under the Plan, require no Committee representation. Accordingly, the Class 4 Claimants should be dismissed from the Committee, or in the alternative, the Court should direct the formation of a separate Class 5 committee, he says. In addition, given the fast track process of the Debtors' bankruptcy cases, Triple Net asks Judge Peck to shorten the time for notice and a hearing on its request. The United States Trustee for Region 2 has objected to Triple Net's request. About Sirva Inc. Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets : SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation solutions to a well-established and diverse customer base. The company handles all aspects of relocation, including home purchase and home sale services, household goods moving, mortgage services and home closing and settlement services. SIRVA conducts more than 300,000 relocations per year, transferring corporate and government employees along with individual consumers. SIRVA's brands include Allied, Allied International, Allied Pickfords, Allied Special Products, DJK Residential, Global, northAmerican, northAmerican International, Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA Settlement. The company has operations in Costa Rica. The company and 61 of its affiliates filed separate petitions for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis, L.L.P. is representing the Debtor. An official Committee of Unsecured Creditors has been appointed in this case. When the Debtors filed for bankruptcy, it reported total assets of US$924,457,299 and total debts of US$1,232,566,813 for the quarter ended Sept. 30, 2007. (Sirva Inc. Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). SIRVA INC: Asks Authority from Court to Sell UK & Ireland Units --------------------------------------------------------------- Sirva Inc. and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Southern District of New York to sell their ownership shares in certain foreign non-Debtors subsidiaries, pursuant to Section 363 of the Bankruptcy Code. SIRVA UK Limited, organized under the laws of England and Wales and a non-Debtor in the Chapter 11 cases, is the Debtors' principal operating company and a parent company of their U.K. moving services businesses. Douglas V. Gathany, senior vice-president and treasurer of Debtor DJK Residential LLC, relates that SIRVA UK had relied on funding from the Debtors to meet its short term cash obligations. SIRVA UK is experiencing a severe "liquidity crunch," and has sufficient liquidity to fund its operations only until March 20, 2008. Absent cash infusions of approximately $8,000,000 after March 20, it will have to commence U.K. insolvency proceedings, Mr. Gathany says. The Debtors' DIP financing will allow only a $3,000,000 funding for non-Debtor parties. Hence, SIRVA UK has two options -- an expedited sale of the business, or administration under U.K. insolvency laws. Mr. Gathany states that a forced administration in the U.K. will not maximize value for the Debtors' estates, which will result in a zero net recovery for equity holders. Mr. Gathany adds that the potential loss of control of the "Pickfords" brand and trademark rights, currently owned by SIRVA UK, will have a severe negative effect on the Debtors' other international businesses. The Debtors' regional managers have advised that if SIRVA's international moving businesses will lose the use of the brand, the value of those businesses, and thus the value of their bankruptcy estates, will sharply decline. Debtor North American International Holding Corporation, in conjunction with other foreign non-Debtor shareholders, have agreed to a private sale of the foreign moving services businesses -- SIRVA Group Holdings Limited and SIRVA Ireland, including The Baxendale Insurance Company Limited, their affiliated Irish insurance business -- to companies managed by TEAM Relocations Limited. In 2007, the Debtors had successfully concluded a similar transaction with TEAM, in connection with the Debtors' assets in continental Europe. TEAM's associated companies will acquire all of the Debtors' capital stock in their U.K. and Irish businesses for GBP2,108,000, pursuant to the Share Purchase Agreement dated March 2, 2008 between North American, NA (UK) Limited Partnership and NA (UK) GP Limited, and Picot Limited and Irving Holdings Limited. The Sale is guaranteed by TEAM Relocations Limited, in a separate guarantee agreement. The Sale Proceeds will be used to offset existing intercompany indebtedness: * GBP1,054,000 for 100 ordinary shares of SIRVA Group Holdings Limited; * GBP1,053,999 for 13,999,999 ordinary shares of SIRVA Ireland Limited; and * GBP1 for 1 ordinary share of SIRVA Ireland Limited. Under the terms of the proposed sale, TEAM will provide SIRVA UK with GBP5,000,000 of immediately available funding, with a 3% interest rate, to avoid insolvency proceedings. In addition, TEAM has agreed to take over SIRVA UK's GBP1,600,000 April payment obligation under the pension scheme funding agreement. TEAM will not object to the extinguishment of either the Debtors' pension scheme guarantees or a GBP8,400,000 intercompany debt from the Debtors to SIRVA UK, pursuant to the Debtors' proposed plan of reorganization. The Purchasers will own the "Pickfords" trademark, and will grant the Debtors the right to use "Pickfords" in 30 countries outside the United Kingdom. Prior to the closing of the sale, the Foreign Moving Businesses will be operated in the ordinary course of business consistent with past practice and will not, among other things, declare or pay any dividends, issue any share capital, or make any loans, other than between those companies. The Guarantee Agreement caps the Guarantor's liability to GBP3,053,000 for replacement letters of credit and scheduled third party assurances, and GBP2,000,000 for unknown third party assurances. Mr. Gathany tells Judge James M. Peck that the Debtors' prepetition and postpetition lenders have approved the Sale, and have consented to the release of their liens on the Shares. Furthermore, Mr. Gathany says that on February 18, 2008, the Debtors' board of directors approved the potential Sale and the Debtors' entry into the Share Purchase Agreement, which was subsequently confirmed by their unanimous written consent dated February 29. The Debtors maintain that the Sale has been proposed and entered into by the Debtors and the Purchasers without collusion, in good faith, and from arm's-length bargaining positions, and therefore, ask Judge Peck to waive the 10-day stay under Rule 6004(g) of the Federal Rules of Bankruptcy Procedure. Sale Motion Hearing Set March 21 The Court has scheduled a hearing to consider the Sale Motion on March 21, 2008 at 10:00 a.m. Eastern Time. Responses or objections to the Sale Motion must be received by the appropriate parties by March 19, at 4:00 p.m. Eastern Time. Sale of U.K. and Ireland Operations to TEAM Group As reported by the Troubled Company Reporter on March 5, 2008, SIRVA, Inc., reached an agreement to sell its moving services operations in the United Kingdom and the Republic of Ireland to a company managed by The TEAM Group, Europe's leading corporate international moving company and a member of the Allied International moving network. The transaction is subject to certain closing conditions, including the receipt of regulatory, court and other approvals. The sale includes Pickfords, the U.K.'s leading moving and storage business, and Allied Pickfords' international moving services business in the U.K. TEAM will manage Pickfords without any interruption to service to existing and future customers. SIRVA's relocation operations in the U.K. and Continental Europe are not part of the transaction. SIRVA remains committed to a continued presence in the relocation market in Europe. SIRVA will also continue to own and operate the Allied Pickfords business in Australia, New Zealand and Asia. The sale reflects SIRVA's strategy of pursuing a business model in which the Company works with representatives around the world to ensure that Allied network customers receive seamless, high- quality service to and from virtually any country in the world, SIRVA said in a statement. Last year, SIRVA sold its moving services operations in 13 European countries to TEAM, which subsequently became the Allied network's representative in those countries. Since then, the two companies have worked together successfully to offer customers integrated international moving services. By selling the U.K. business to an existing Allied representative, SIRVA further strengthens the Allied network and ensures service to customers -- either relocating to the U.K. or moving within the country -- will be unaffected. "We are pleased to announce this transaction, which allows SIRVA to focus on our core businesses. As TEAM are already members of the Allied network in Europe, SIRVA ensures customers in the U.K. will continue to receive global coverage and the highest levels of service; and Pickfords becomes part of another trusted organization," said SIRVA President and Chief Executive Officer Robert W. Tieken. Cees Zeevenhooven, TEAM Allied Group CEO, said, "Pickfords has a great heritage, and we look forward to growing the company. This transaction builds on the process which we began one year ago to increase our presence in the European marketplace, and we anticipate expansion of the TEAM Allied network throughout the continent." The TEAM Group is Europe's leader and one of the world's largest international moving and relocation companies, with over 40 operations in 14 countries. The Group employs over 900 specialist staff and provides a comprehensive range of innovative cost- effective mobility solutions. About the TEAM Group The TEAM Group -- http://www.teamgoc.com-- is Europe's leader and one of the world's largest international moving and relocation companies, with over 40 operations in 14 countries. The Group employs over 900 specialist staff and provides a comprehensive range of innovative cost-effective mobility solutions. About Sirva Inc. Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets : SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation solutions to a well-established and diverse customer base. The company handles all aspects of relocation, including home purchase and home sale services, household goods moving, mortgage services and home closing and settlement services. SIRVA conducts more than 300,000 relocations per year, transferring corporate and government employees along with individual consumers. SIRVA's brands include Allied, Allied International, Allied Pickfords, Allied Special Products, DJK Residential, Global, northAmerican, northAmerican International, Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA Settlement. The company has operations in Costa Rica. The company and 61 of its affiliates filed separate petitions for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis, L.L.P. is representing the Debtor. An official Committee of Unsecured Creditors has been appointed in this case. When the Debtors filed for bankruptcy, it reported total assets of US$924,457,299 and total debts of US$1,232,566,813 for the quarter ended Sept. 30, 2007. (Sirva Inc. Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). SCOTTISH RE: May Sell Life Reinsurance & Wealth Management Units ---------------------------------------------------------------- Scottish Re Group Ltd. told The Royal Gazette that it may sell its international life reinsurance and wealth management units. According to The Gazette, Scottish Re wants to cut costs after suffering mortgage-related losses and a credit rating downgrade. Scottish Re told The Gazette that it is losing money from investments tied to subprime and "Alt-A" residential mortgages. A Jan. 31 downgrade by Standard & Poor's will also make it harder for the company to compete and to expand its core life reinsurance business, The Gazette says, citing Scottish Re. Scottish Re told The Gazette that it will continue concentrating on its North American life reinsurance business, "through strategic alliances or other means and cut costs to preserve capital and liquidity." Scottish Re said it set up a financial incentive program to keep "essential" employees, The Gazette adds. Scottish Re Group Ltd. -- http://www.scottishre.com/-- is a global life reinsurance specialist. Scottish Re has operating businesses in Bermuda, Grand Cayman, Guernsey, Ireland, the United Kingdom, United States, and Singapore. Its flagship operating subsidiaries include Scottish Annuity & Life Insurance Company (Cayman) Ltd. and Scottish Re (US), Inc. Scottish Re Capital Markets, Inc., a member of Scottish Re Group Ltd., is a registered broker dealer that specializes in securitization of life insurance assets and liabilities. * * * As reported in the Troubled Company Reporter on Feb. 4, 2008, Standard & Poor's Ratings Services lowered its counterparty credit rating on Scottish Re Group Ltd. to 'B' from 'B+'. At the same time, it lowered its counterparty credit and financial strength ratings on Scottish Re's operating companies to 'BB' from 'BB+' and also lowered the ratings on all these companies' dependent unwrapped securitized deals by one notch. In addition, S&P placed the ratings on all these companies on CreditWatch with negative implications. As reported in the Troubled Company Reporter on Feb. 19, 2008, Moody's Investors Service placed Scottish Re Group Limited's Senior unsecured shelf of (P)Ba3; subordinate shelf of (P)B1; junior subordinate shelf of (P)B1; preferred stock of B2; and preferred stock shelf of (P)B2 ratings on review for downgrade. SPRINGS WINDOW: Moody's Cuts Rating to 'B2' on Weak 2007 Results ---------------------------------------------------------------- Moody's lowered Springs Window Fashions, LLC's Corporate Family Rating and senior secured credit facility ratings to B2 from B1 and lowered the Probability of Default Rating to B3 from B2. This rating action follows third quarter 2007 results that were significantly below expectations, lowered projections for the fourth quarter of 2007 and fiscal year 2008, and Moody's concerns about the company's ability to comply with financial covenants once permitted levels tighten in 2008. Weakness in the US housing market and attendant general economic slowdown has caused a decline in consumer demand for window coverings that is expected to persist over the near term. Concurrently, the maximum leverage covenant under the senior secured credit agreement steps down from its current level of 5.0 times to 4.75 times at June 30, 2008 and then to 4.5 times as of September 30, 2008. Moody's believes it may be necessary for Springs to seek covenant relief from its bank group. These rating actions were taken: -- Corporate Family Rating downgraded to B2 from B1; -- Probability of Default Rating downgraded to B3 from B2; -- $100 million senior secured revolver due 2010 downgraded to B2 (LGD3, 33%) from B1 (LGD3, 34%); -- $311 million senior secured term loan B due 2012 downgraded to B2 (LGD3, 33%) from B1 (LGD3, 34%). The stable outlook anticipates the ability to obtain covenant relief, if necessary, and incorporates a moderate decline in 2008 revenue, partially offset by management's planned cost improvement initiatives. Springs Window Fashions, LLC, headquartered in Middleton, Wisconsin, is a leading manufacturer and designer of window coverings under the brand names of Bali, Graber and Nanik. Product lines include hard and soft window blinds, roller shades, drapery hardware, shutters, solar shades, and window accessory products. The company is privately held and had revenues of $563 million for the twelve months ended Sept. 30, 2007. STATION CASINOS: Posts $375.6 Million Net Loss in 2007 ------------------------------------------------------ Station Casinos Inc. reported a net loss of $375.6 million for the year ended Dec. 31, 2007, compared with net income of $110.2 million for the year ended Dec. 31, 2006. Consolidated net revenues for 2007 increased 8.1% to $1.45 billion as compared to $1.34 billion for the year ended Dec. 31, 2006. Year over year net revenues increased primarily due to revenue increases at the company's Major Las Vegas Operations, which were offset by decreased management fees. Net revenues from the company's Major Las Vegas Operations increased 10.1% to $1.31 billion for 2007 as compared to $1.19 billion for the year ended Dec. 31, 2006. The increase is a result of a full year of operations at Red Rock, the completion of the phase II master-planned expansion at Red Rock in December 2006, the completion of the phase III expansion at Red Rock in April 2007, as well as the completion of expansions at Santa Fe Station in December 2006 and Fiesta Henderson in August 2006. Consolidated operating income decreased to a loss of $139.9 million in 2007 as compared to operating income of $316.1 million for the year ended Dec. 31, 2006. The decrease is primarily a result of $156.5 million in merger transaction costs incurred during 2007 related to the merger with Fertitta Colony Partners LLC, which was completed on Nov. 7, 2007. 2007 was also impacted by $288.1 million of share-based compensation expense related to equity-based awards granted upon the consummation of the merger and a $16.6 million impairment loss. The company's share of earnings from joint ventures were $40.1 million and $41.9 million for the years ended Dec. 31, 2007, and 2006, respectively. The decrease is primarily the result of the company's 50% portion of costs related to terminating a management agreement and a lease agreement at Green Valley Ranch of approximately $1.9 million. Interest expense, net of capitalized interest, increased 50.6% to $258.6 million in 2007 as compared to $171.7 million in the year ended Dec. 31, 2006. Gross interest expense increased approximately $75.1 million due to an increase in long-term debt of approximately $1.8 billion in 2007. For the years ended Dec. 31, 2007, and 2006, the company recorded $28.2 million and $6.8 million, respectively, in interest and other expense related to its unconsolidated joint ventures. The increase in expense during 2007 as compared to 2006 is due to the new $830 million credit facility at Green Valley Ranch entered into on Feb. 16, 2007, which resulted in an increase in debt of approximately $582.8 million in the year ended Dec. 31, 2007, as well as an $800,000 charge for a loss on early retirement of debt related to the prior credit facility. During 2007, in conjunction with the merger, the company terminated its then existing revolving facility resulting in a loss on early retirement of debt of $20.3 million, which includes the write-off of unamortized loan costs as well as costs to terminate its then existing interest rate swaps. Liquidity and Capital Resources In connection with the merger on Nov. 7, 2007, the company received $2.71 billion in cash equity contributions, $2.475 billion from the issuance of the CMBS Loans and entered into a $900.0 million Credit Agreement with initial borrowings of $510 million. In addition, the company paid $4.17 billion for the merger consideration payment for each outstanding share of the company's common stock, $1.38 billion to terminate its then existing revolving credit facility and $12.2 million to terminate interest rate swaps tied to such revolving credit facility. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $8.99 billion in total assets, $6.42 billion in total liabilities, and $2.57 billion in total stockholders' equity. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $194.5 million in total current assets available to pay $220.7 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the year ended Dec. 31, 2007, are available for free at http://researcharchives.com/t/s?28dc About Station Casinos Headquartered in Las Vegas, Nevada, Station Casinos Inc. (NYSE: STN) -- http://www.stationcasinos.com/-- owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Casino and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Magic Star Casino, Gold Rush Casino and Lake Mead Lounge in Henderson, Nevada. Station also owns a 50.0% interest in Green Valley Ranch Station Casino, Barley's Casino & Brewing Company and The Greens in Henderson, Nevada and a 6.7% interest in the Palms Casino Resort in Las Vegas, Nevada. In addition, Station manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services lowered its corporate credit rating on Station Casinos Inc. to 'B+' from 'BB-'. The rating outlook is negative. STRADA 315: Regions Bank Wants Court to Appoint an Examiner ----------------------------------------------------------- Regions Bank, the only major secured creditor of Strada 315 LLC, asks the U.S. Bankruptcy Court for the Southern District of Florida to appoint an examiner in the Debtor's bankruptcy case. Regions Bank loaned to the Debtor $34,800,000 to finance the acquisition and development of the Debtor's single asset, known as Strada 315, a residential and commercial condominium. Regions Bank relates that in a number of separate occasions, it received pleas from the Debtor to extend the loan's maturity date. However, Regions Bank believes that the loan was "out-of-balance" by a significant amount -- the cost to complete the project exceeded the amount of available and unfunded loan proceeds -- and the Debtor had not then completed the project by the completion date or loan date extensions required by the loan agreement. Regions Bank, in good faith, agreed to extend the loan's maturity date on those occasions, and released the appropriate needed funds for the construction. As a result of the Bank's concerns that the Debtor's project may be significantly out-of-balance, Regions Bank requested that the Debtor and its general contractor provide the Bank with an owner's affidavit and a contractor's affidavit identifying the remaining amounts needed to complete the project. The Debtor previously made repeated assurances to the Bank that the affidavits would be submitted. Various contractors filed liens against the Debtor which disturbed Regions Bank, since it already funded the Debtor to pay these certain contractors for their services. Despite the fact that loan proceeds were released specifically for repayment of the liens, the Debtor, after receipt of these retainage funds, did not pay the contractors. Under the loan agreement, the lien filings constituted a clear event of default. Early this year, the Debtor finally delivered to Regions Bank the contractor's and owner's affidavits. These affidavits revealed that $3,691,355 was still remaining to be paid to subcontractors to complete the project, not including amounts owed to certain contractors pursuant to their claims of lien. The amount, Regions Bank said, far exceeded any previous estimates and is in excess of 15% of the original hard costs of the project. Due to the lack of reliable information concerning the affairs of the Debtor, no creditor is in a position to formulate a plan of reorganization of the Debtor, or to give intelligent consideration to any plan which may be proposed by the Debtor. Regions Bank also noticed that the Debtor's accountant, which was employed within the case, would only serve to assist the Debtor in completing schedules, debtor-in-possession reports, and other bankruptcy accounting matters, and would not be intended to serve the interests of all creditors of the estate. Regions Bank said that it is imperative to investigate the acts, conduct, property, liabilities, and financial condition of the Debtor, the operation of the Debtor's business and the desirability of its continuance, and any investigation should be made by a disinterested person for the benefit of all creditors. Strada 315 LLC is affiliated with Delray Beach's Southpoint Realty Development. It owns and manages luxury condominiums. The Debtor filed for chapter 11 protection on Feb. 11, 2008 (Bankr. S.D. Fla. Case No. 08-11574). Scott A. Underwood, Esq. represents the Debtor in its restructuring efforts. The Debtor listed assets and debts between $10 million and $50 million. Its three major unsecured creditors are Associated Steel & Aluminium, Coleman Floor Co., and Y.&T. Plumbing Corp., with claims of less than $1 million each. STRUG LLC: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: Strug, LLC 405 North. Wabash, Suite 3504 Chicago, IL 60611 Bankruptcy Case No.: 08-05264 Type of Business: The Debtor is a mortgage and real estate firm. Chapter 11 Petition Date: March 5, 2008 Court: Northern District of Illinois (Chicago) Judge: Eugene R. Wedoff Debtor's Counsel: Walter R Dale, Esq. (professordale@ameritech.net) 5555 South Everett Avenue, Suite 9C Chicago, IL 60637 Tel: (312) 925-2583 Fax: (773) 288-1505 Estimated Assets: $1 million to $100 million Estimated Debts: $1 million to $100 million The Debtor did not file a list of its largest unsecured creditors. SUN HEALTHCARE: Posts $35.3 Mil. Earnings for 2007 Fourth Quarter ----------------------------------------------------------------- Sun Healthcare Group Inc. reported net income of $35.3 million for the 2007 fourth quarter ended Dec. 31 compared to $19.8 million net income for the 2006 fourth quarter. For the fiscal year ended Dec. 31, 2007, the company's net income is $57.5 million versus $27.1 million income for fiscal 2006. For the 2007 fourth quarter, the company generated a total of $450.5 million revenues from $258.4 million revenues for the same period of the prior year. Total revenues generated for the 2007 fiscal year totaled $1,587.3 million, up 58% from $1,004.8 million revenues of 2006. Normalized actual results for the quarter ended Dec. 31, 2007 include pre-tax adjustments for $2.3 million of income from a settlement of a claim associated with a prior period acquisition, $3.5 million of income from adjustments of prior period self- insurance reserves, a $3.2 million charge associated with the refinancing of debt agreements and a charge of $1.0 million related to integration costs associated with the Harborside acquisition. Normalized actual results for the 2007 fiscal year include pre-tax adjustments for $4.5 million of integration costs associated with the Harborside acquisition, $12.5 million of income from adjustments of prior period self-insurance reserves, $3.9 million of which were related to discontinued operations, $2.3 million of income from a settlement of a claim associated with a prior period acquisition, and $3.8 million in charges associated with the refinancing of debt agreements. "We are pleased that we have ended our best year on a strong note with $0.20 normalized EPS for the fourth quarter," Richard K. Matros, chairman and chief executive officer of Sun, stated. "For the year, we came in a penny shy of the high end of our upwardly revised November 2007 guidance at $0.63 EPS, which was $0.11 better than the high side of our original 2007 guidance." "The guidance we issued last month for 2008 reflects confidence in our ability to continue to move margins on a same store basis," Mr. Matros continued. "Our first quarter 2008 skilled mix trends are strong." "The Harborside integration is proceeding as expected with an additional $2.8 million in synergies hitting the bottom line in the fourth quarter of 2007, bringing our total synergies realized for the year to $6.4 million," Mr. Matros said. "We expect to have a total of $10 million in synergies by the end of the first quarter of 2008 and expect to hit the high end of our $12 to $15 million in synergies by year end 2008." "We will continue to focus in 2008 on margin improvement, integration activities, company wide process improvement initiatives, and activities that will result in a deleveraging of the balance sheet," Mr. Matros added. "The shift in acuity continues to be our primary focus in our inpatient segment," Mr. Matros further stated. "This focus is across all of our nursing centers with a particular emphasis on the development of our Rehab Recovery Suites." "The company had 33 RRS open at year end," Mr. Matros went on to say. "We expect to have 38 open by the end of the first quarter with two more shortly thereafter, and anticipate at least 50 units open by the end of 2008." "We are particularly pleased with the fourth quarter's growth in Medicare and skilled mix both in terms of occupancy and as a percent of revenues," Mr. Matros imparted. "As expected we rebounded from the slight softness in Medicare occupancy we experienced in the second and third quarters of last year." "This positive mix trend is continuing in 2008," Mr. Matros concluded. "We will continue to refine and execute our quality of care initiatives with an intensity that reflects the highest of priorities." As of Dec. 31, 2007, the company's balance sheet reflected $1.3 billion total assets, $1.1 billion total liabilities resulting to a total stockholders' equity of $0.2 billion. About Sun Healthcare Headquartered in Irvine, California, Sun Healthcare Group Inc. (NASDAQ:SUNH) -- http://www.sunh.com-- provides long-term, subacute and related specialty healthcare services primarily to the senior population in the United States. The company's core business is providing inpatient services, primarily through 118 skilled nursing facilities, 13 assisted and independent living facilities, seven mental health facilities and three specialty acute care hospitals with 15,447 licensed beds located in 19 states as of March 1, 2007. Sun Healthcare Group also provides rehabilitation therapy services and medical staffing, and other ancillary services. The company operates through three business segments: impatient services, rehabilitation therapy services and medical staffing services. In December 2006, the company sold SunPlus Home Health Services. In April 2007, the company completed the acquisition of Harborside Healthcare Corporation. Harborside is a privately held healthcare company based in Boston, Massachusetts, which operates 73 nursing facilities. * * * Sun Healthcare continues to hold Standard and Poor's 'B' long-term foreign and local issuer credit rating with a stable outlook and Moody's Investor's Service's 'B1' long-term corporate family rating, 'Ba2' bank loan debt rating, 'B3' subordinated debt rating and 'B1' probability of default rating with a stable outlook. Both rating agencies assigned their respective ratings on March, 2007. SUNCO PRODUCTS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Sunco Products, Inc. 16039 Loukelton Street Industry, CA 91744 Bankruptcy Case No.: 08-30940 Chapter 11 Petition Date: March 4, 2008 Court: District of Minnesota (St. Paul) Judge: Dennis D. O'Brien Debtor's Counsel: Robert T. Kugler, Esq. Leonard, Street & Deinard P.A. 150 South Fifth Street Suite 2300 Minneapolis, MN 55402 Tel: (612) 335-1645 robert.kugler@leonard.com Estimated Assets: $0 to $50,000 Estimated Debts: $1 million to $10 million Debtor's list of its 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Gold Pleasure Industrial Co. L $1,615,485 7F, 1067 King's Road Hong Kong Alto $6,023 2867 Surveyor Street Pormona, CA 91768 Unity Property Investments, In $4,700 16039 Loukelton Street Industry, CA 91744 FedEx $2,000 South Bay Distribution $1,342 Netzel Associates Inc. $1,093 EDI Express $1,055 Banghart-Corin & Associates $769 Kahn & Comings, Inc. $713 Man Fu Yeung $653 C.M.A. Inc. $647 Ronnie Yeung $462 Maan Yoong $399 Linda Lee Ying Cheung $392 Primus $300 Anna L. Hernandez $256 Gregory W. Crist $248 Dot-Line Transportation $162 Paychex $138 AT&T $70 SUPERCLICK INC: Jan. 31 Balance Sheet Upside-Down by $1,327,595 --------------------------------------------------------------- Superclick Inc.'s consolidated financial statements at Jan. 31, 2008, showed $1,926,284 in total assets and $3,253,879 in total liabilities, resulting in a $1,327,595 total stockholders' deficit. At Jan. 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $1,627,196 in total current assets available to pay $3,240,739 in total current liabilities. The company reported net income of $178,348 on net revenue of $1,447,855 for the first quarter ended Jan. 31, 2008, compared with a net loss of $61,471 on net revenue of $761,635 in the same period ended Jan. 31, 2007. Net sales increased $493,832 or 207.7%, while services revenue increased $192,388 or 36.7% due to a greater number of rooms under support. Income from operations for the three months ended Jan. 31, 2008, was $208,776 or 14.4% of net revenue, compared to $12,416 or 1.6% of net revenue, respectively. Interest expense for the three months ended Jan. 31, 2008, and 2007, was $47,880 and $82,637, respectively. Going Concern Disclaimer Bedinger & Company in Concord, Calif., expressed substantial doubt about Superclick Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Oct. 31, 2007. The auditing firm pointed to the company's accumulated capital deficit and significant debt. About Superclick Inc. Headquartered in Montreal, Quebec, Superclick Inc., (OTC BB: SPCK.OB) -- http://www.superclick.com/ -- through its wholly owned, Montreal-based subsidiary Superclick Networks Inc., develops, manufactures, markets and supports the Superclick Internet Management System, Monitoring and Management Application and Media Distribution System in worldwide hospitality, conference center and event, multi-tenant unit and university markets. Current clients include MTU residences and Candlewood Suites, Crowne Plaza, Fairmont Hotels, Four Points by Sheraton, InterContinental Hotels Group PLC, Hilton, Holiday Inn, Holiday Inn Express, Hampton Inn, Marriott, Novotel, Radisson, Sheraton, Westin and Wyndham hotels in Canada, the Caribbean and the United States. THORNBURG MORTGAGE: KPMG Says Feb. 2008 Audit Report Unreliable --------------------------------------------------------------- Thornburg Mortgage Inc. received a letter dated March 4, 2008, from its principal accountant, KPMG LLP, stating that its audit report, dated Feb. 27, 2008, reflected on the company's consolidated financial statements as of Dec. 31, 2007, and 2006, and for the two-year period ended Dec. 31, 2007, which is included in the company's annual report on Form 10-K for 2007, should no longer be relied upon. As a result, the company's board of directors determined that the financial statements for the year ended Dec. 31, 2007, should be restated. Difficult Market Conditions Raise Substantial Going Concern Doubt The company noted that difficult market conditions that have resulted in a significant deterioration of prices of mortgage- backed collateral, combined with a liquidity position under unprecedented pressure from increased margin calls by its reverse repurchase agreement lenders, a portion of which the company has been unable to meet, have raised substantial doubt about the company's ability to continue as a going concern. In addition, the company may not have the ability to hold certain of its purchased ARM assets to recovery and, accordingly, on March 5, 2008, the company concluded that a $427.8 million charge for impairment on its purchased adjustable-rate mortgage assets is required as of Dec. 31, 2007, in accordance with generally accepted accounting principles. Based upon a review of credit ratings, delinquency data and other information, the company does not believe these unrealized losses, for the most part, are reflective of credit deterioration. Restatement Has No Material Impact The company believes that this restatement of its consolidated financial statements will not have a material impact on the company's book value at Dec. 31, 2007. In the company's 2007 annual report on Form 10-K filed on Feb. 28, 2008, the company reported GAAP book value as of Dec. 31, 2007, of $8.36 per common share, compared to a GAAP book value of $8.40 per common share, after reflecting the effect of the preliminary restatement of the company's 2007 consolidated financial statements. The increase in book value is attributable to the company's elimination of the fourth-quarter performance fee payable to the company's manager, which increased the book value by $0.04 per common share. Thornburg Mortgage President and Chief Executive Officer Larry Goldstone noted that companies are required to value their asset portfolios at the price that the portfolio could be sold in the market as of the financial statement date. Companies must recognize a loss in the income statement if they are not able to hold the assets until their value is recovered, even if those companies have no intention of selling their portfolios. "The mortgage financing market's complete inability to differentiate and appropriately value superior AAA-/AA-rated mortgage securities from all other mortgage assets is as unprecedented as it is frustrating,"said Mr. Goldstone. "Our portfolio of mortgage-backed securities has exhibited exceptional credit performance and comprises loans that are among the most solid in the industry. Quite simply, the panic that has gripped the mortgage financing market is irrational and has no basis in investment reality." About Thornburg Mortgage Headquartered in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- is a single- family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable-rate mortgages. It originates, acquires, and retains investments in adjustable and variable rate mortgage assets. Its ARM assets comprise of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. * * * As reported in the Troubled Company Reporter on March 5, 2008, Standard & Poor's Ratings Services lowered its long-term counterparty credit rating on Thornburg Mortgage to 'SD' from 'B-'. The ratings on Thornburg's senior unsecured debt and preferred stock are on CreditWatch with negative implications. The TCR said on March 5, 2008, that given the uncertainty surrounding the pricing of Thornburg Mortgage's portfolio securities in the secondary mortgage market and its effects on the company's short-term financing, the company's ratings for Thornburg remain on Rating Watch Negative by Fitch Ratings. The ratings are Issuer Default Rating 'CCC'; Senior unsecured notes 'CCC-/RR5'; Unsecured subordinate notes 'CC/RR6'; and Preferred stock 'CC/RR6'. The TCR also stated on March 5 that Moody's Investors Service downgraded to Caa2 from B2 and to Ca from Caa1 the senior unsecured debt and preferred stock ratings, respectively, of Thornburg Mortgage. The ratings remain under review for possible downgrade. THORNBURG MORTGAGE: Cross-defaults Cue Moody's Rating Cut to 'Ca' ----------------------------------------------------------------- Moody's Investors Service downgraded to Ca from Caa2 and to C from Ca the senior unsecured debt and preferred stock ratings, respectively of Thornburg Mortgage, Inc. Thornburg's Ca unsecured debt rating remains under review for possible downgrade. The downgrades were in response to Thornburg's announcement that cross-defaults have been triggered under all of the REIT's repurchase agreements and secured loan agreements. Reverse repurchase agreements represent a key source of funding for the company. Moody's review for possible downgrade of Thornburg's senior unsecured debt reflects the REIT's higher likelihood of default and the potential for an above average severity of loss in the event of default. These ratings were downgraded and remain under review for possible downgrade: -- Thornburg Mortgage, Inc.: Senior debt to Ca, from Caa2; Senior debt shelf to (P)Ca, from (P)Caa2; These ratings were downgraded: -- Thornburg Mortgage, Inc.: Preferred stock to C, from Ca; Preferred stock shelf to (P)C, from (P)Ca. Thornburg Mortgage, Inc. based in Santa Fe, New Mexico, is a prominent mortgage investor and originator organized as a REIT. As of Dec. 31, 2007, Thornburg Mortgage reported assets of approximately $36.5 billion and book equity of approximately $2 billion. THORNBURG MORTGAGE: S&P Slashes Senior Unsec. Debt Rating to 'CC' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its issue ratings on Thornburg Mortgage Inc.'s senior unsecured debt to 'CC' from 'CCC+' and preferred stock to 'C' from 'CCC-'. Both issue ratings will remain on CreditWatch negative, where they were placed on March 3, 2008. The counterparty credit rating remains on selective default. "The rating action is based on Thornburg's announcement that cross-defaults have been triggered under all of the company's repurchase agreements and secured loan agreements," said Standard & Poor's credit analyst Adom Rosengarten. Given Thornburg's limited financial resources, S&P believes the risk of default has increased further. THORNBURG MORTGAGE: Fitch Slashes ID Rating to 'RD' from CCC ------------------------------------------------------------ Given Thornburg Mortgage, Inc.'s weakening credit profile stemming from defaults under the company's reverse repurchase agreements, Fitch has downgraded and removed these ratings from Rating Watch Negative: -- Issuer Default Rating to 'RD' from 'CCC'; -- Senior unsecured notes to 'C/RR6' from 'CCC-/RR5'; -- Unsecured subordinate notes to 'C/RR6' from 'CC/RR6'; -- Preferred stock to 'C/RR6' from 'CC/RR6'. Fitch downgraded the IDR to 'RD' indicating that Thornburg was in default under, and has failed to meet a margin call for, one of its reverse repurchase agreements, but continues to honor other classes of obligations. This event of default has triggered cross-defaults under all of Thornburg's other reverse repurchase agreements. Reverse repurchase agreements represent the primary short-term funding source for the company. Based in Santa Fe, New Mexico, Thornburg Mortgage, Inc. is a lender to the single-family residential mortgage housing market and is focused principally on the jumbo segment. Thornburg originates, acquires and retains investments in adjustable-rate mortgage assets. Thornburg's ARM assets are comprised of Purchased ARM Assets and ARM Loans. All of Thornburg's ARM assets are either Traditional ARMs, which includes Pay Option ARMs, or Hybrid ARMs. For tax purposes, Thornburg is organized as a real estate investment trust and is managed externally by Thornburg Mortgage Advisory Corporation. THORNBURG MORTGAGE: Signs Reverse Repurchase Agreements ------------------------------------------------------- Thornburg Mortgage Inc. has entered into reverse repurchase agreements, a form of collateralized short-term borrowing, with various counterparties. The company said it received a letter from JPMorgan Chase Bank, N.A., dated Feb. 28, 2008, after failing to meet a margin call of approximately $28 million. The letter states that an event of default as defined under that certain Master Repurchase Agreement, dated as of Aug. 3, 2006, as amended on Feb. 7, 2007, by and between the company and JPMorgan exists. The letter also notified the company that JPMorgan will exercise its rights under the agreement. The aggregate amount of proceeds lent to the company under the agreement was approximately $320 million. The company said that its receipt of the notice of an event of default has triggered cross-defaults under all of its other reverse repurchase agreements and its secured loan agreements. The company's obligations under those agreements are material. Liquidity, Margin Calls, Default Notices In a Securities and Exchange Commission filing dated March 7, 2008, the company disclosed it had readily available liquidity of approximately $580.0 million at Dec. 31, 2007. Through the close of business on March 6, 2008, the company had received $1.777 billion in margin calls since Dec. 31, 2007, and had satisfied $1.167 billion of those margin calls primarily by using its available liquidity, principal and interest payments and proceeds from the sale of assets. As of close of business on March 6, 2008, the company had outstanding margin calls of $610.0 million which significantly exceeded its available liquidity at that date. The company has entered into a temporary syndicate agreement with its remaining reverse repurchase agreement counterparties which freezes additional margin calls through Friday, March 7, 2008, while the company pursues solutions to its liquidity shortfall. This agreement is renewable at the option of the company's lenders and the company. Through the close of business on March 6, 2008, the company had received notices of event of default under reverse repurchase agreements from four different lenders. Working To Meet Margin Calls The company is working to meet all of its outstanding margin calls within a timeframe acceptable to its lenders, through a combination of selling portfolio assets, issuing collateralized mortgage debt and raising additional debt or equity capital. Since Dec. 31, 2007, and through the close of business on March 6, 2008, the company has reduced its portfolio of adjustable-rate mortgage assets financed with recourse financing by approximately $4.6 billion, of which $1.9 billion has been permanently financed in order to reduce its exposure to margin calls. The company also has raised $488.0 million in equity capital since Dec. 31, 2007, and seeks to raise additional capital in order to provide a more stable base of liquidity during a period when the company expects market conditions to remain difficult for at least several months. The $427.8 million impairment charge resulted in a decrease in management fees of $300,000 and the elimination of the fourth quarter performance fee of $5.4 million. The company intends to reflect the revised financial information in an amended annual report on Form 10-K/A. Mr. Goldstone concluded, "We are committed to implementing initiatives that will resolve our current liquidity issues so we can deliver long-term growth, continue as a going concern, and ensure stability for our shareholders and for the company." Financial Results Thornburg Mortgage reported a net loss of $874.9 million for the year ended Dec. 31, 2007, compared to net income of $297.7 million for the year ended Dec. 31, 2006. Results for 2007 include a $1.10 billion loss on the sale of $23.6 billion of purchased adjustable-rate mortgage assets. At Dec. 31, 2007, the company's consolidated balance sheet showed $36.5 million in total assets, $34.5 million in total liabilities, and $2.00 billion in total stockholders' equity. About Thornburg Mortgage Headquartered in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- is a single- family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable-rate mortgages. It originates, acquires, and retains investments in adjustable and variable rate mortgage assets. Its ARM assets comprise of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. * * * As reported in the Troubled Company Reporter on March 5, 2008, Standard & Poor's Ratings Services lowered its long-term counterparty credit rating on Thornburg Mortgage to 'SD' from 'B-'. The ratings on Thornburg's senior unsecured debt and preferred stock are on CreditWatch with negative implications. The TCR said on March 5, 2008, that given the uncertainty surrounding the pricing of Thornburg Mortgage's portfolio securities in the secondary mortgage market and its effects on the company's short-term financing, the company's ratings for Thornburg remain on Rating Watch Negative by Fitch Ratings. The ratings are Issuer Default Rating 'CCC'; Senior unsecured notes 'CCC-/RR5'; Unsecured subordinate notes 'CC/RR6'; and Preferred stock 'CC/RR6'. The TCR also stated on March 5 that Moody's Investors Service downgraded to Caa2 from B2 and to Ca from Caa1 the senior unsecured debt and preferred stock ratings, respectively, of Thornburg Mortgage. The ratings remain under review for possible downgrade. UNIVISION COMMS: Sells Recording and Publishing Business to UMG --------------------------------------------------------------- On Feb. 27, 2008, Univision Communications Inc. entered into a purchase agreement with UMG Recordings Inc. for the sale of Univisions music recording and publishing businesses. The total consideration due to Univision under the purchase agreement is $153 million, including approximately $13 million for working capital, payable in cash: (i) approximately $113 million upon the closing, (ii) $11.5 million upon the first anniversary of the closing, (iii) $12.5 million upon the second anniversary of the closing, (iv) $6 million upon the third anniversary of the closing, and (v) $10 million upon the fourth anniversary of the closing, subject to purchase price adjustments. Univision is expected to incur fees and certain obligations of approximately $10 million in connection with the transaction. Under the purchase agreement, Univision committed to provide both preemptible and non-preemptible advertising support through broadcast commercials that will be aired on the Univision and Telefutura Networks, and Univisions owned and operated television stations, for the Universal Music Group and its Latin artists over the five year period following the closing. The total consideration includes amounts payable to Univision for such advertising support. Univision is required to indemnify Universal from and against losses it may incur arising out of breaches by Univision of representations, warranties and covenants set forth in the purchase agreement, subject to certain limitations as set forth in the purchase agreement. Between the date of the purchase agreement and the closing, Univision has to operate the music business in all material respects, in the ordinary course consistent with past practice and may not take certain actions, as specified in the purchase agreement, without Universals prior consent. Consummation of the transaction is conditioned upon the expiration or termination of any waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the Mexican Federal Competition Law, and there must not have been a Material Adverse Effect since Sept. 30, 2007. Univision expects the transaction to close in the second quarter of 2008. Univision intends to use approximately $113 million in gross proceeds from the sale of its music recording and publishing businesses together with the proceeds from the sale of certain non-core television and radio stations, investments and real estate, and may potentially use borrowings under its bank senior secured revolving credit facility, to pay down its $500 million bank second-lien asset sale bridge loan due March 29, 2009. About Univision Communications Headquartered in Los Angeles, California, Univision Communications -- http://www.univision.com-- owns and operates more than 60 TV stations in the US and Puerto Rico offering a variety of news, sports, and entertainment programming. Its Univision Network, which is also carried by more than 1,700 cable affiliates, reaches about 99% of US Hispanic households. The company also operates a smaller broadcast network, TeleFutura, and cable network Galavisi�n, while its Univision Radio division boasts about 70 stations. Founded in 1961 as Spanish International Network, Univision was acquired in 2007 by a group of private investment firms led by TPG Capital and Thomas H. Lee Partners. * * * The proceeds expected to be received for the music assets are lower than Fitch's initial expectations. Fitch currently expects the company can generate an additional approximately US$175 million in gross proceeds from the sale of assets that produce little or no cash flow. As such, Fitch does expect there to be a shortfall between proceeds from the initial non- cash-flow producing asset sales and the second-lien loan. Fitch believes the company has smaller-market cash-flow producing stations that are non-core assets which could be divested to take care of any remaining shortfall of the second-lien loan, including its radio stations in the San Diego and Las Vegas markets. Also, the company had US$123 million in cash on its balance sheet at Sept. 30, 2007. Fitch would expect year-end cash balances to be disclosed on this week's earnings release and/or conference call. These combined sources should partially mitigate the total amount that the company may need from its credit facility. Fitch notes that the credit facility does have a MAC clause prior to each borrowing. The company also has a near-term US$200 million 2008 maturity that is expected to be covered by a committed delay-draw facility which also has a MAC clause. Beyond these maturities, the company does not have another significant maturity until US$500 million due July 2011. Assuming the PIK option is used, Fitch estimates cash interest coverage to be below 1.5 times which is lower than Fitch's initial expectations and weak for Fitch 'B' IDR rating. This is balanced by Fitch's continued expectations for strong growth over the intermediate term. Fitch will continue to monitor the company's quarterly results, including this week's release, and any impact the softening economic environment may have on expected future cash flows. Given the high leverage, any meaningful variances from Fitch expectations of the next 18 months including maturities, could result in negative rating action or outlook revisions. UNIVISION COMMS: S&P Cuts Rating on Low Asset Sale Proceeds ----------------------------------------------------------- Standard & Poor's Rating Services lowered its corporate credit ratings on Los Angeles-based Univision Communications Inc. to 'B-' from 'B'. The outlook is negative. "The downgrades reflect significantly lower than expected asset sale proceeds for Univision's music division and an increasing challenge, in our view, to cover its $500 million second-lien asset sale bridge loan that matures in March 2009," explained Standard & Poor's credit analyst Michael Altberg. The company recently announced its intention to sell its music division to Universal Music Group for $153 million, of which only $113 million is due upon closing and will be available to help repay the second-lien bridge loan. The upfront cash amount is down significantly from S&P's original expectations. Under the terms of the credit agreement, Univision may borrow up to $250 million on its revolving credit facility to cover asset-sale shortfalls. Univision plans to sell additional assets and investments to repay the remainder of the bridge loan maturity. S&P is concerned about the timeline and feasibility of additional asset sales amid tight credit market conditions, and believes there is now an increased likelihood that the company will have to access its revolving credit facility. The ratings reflect the company's highly leveraged capital structure and weakened credit metrics following its February 2007 LBO; its continuing tense relationship with its main program supplier, Grupo Televisa S.A.; Spanish-language media's inability to draw advertising revenues commensurate with its audience ratings; increasing competition for advertisers and viewers; and, most importantly over the near term, uncertainty surrounding its ability to repay its second-lien bridge loan maturity in early 2009. These factors are partially offset by Univision's satisfactory business risk profile, reflecting its dominant position as the major U.S.-based Spanish-language TV and radio broadcaster; broadcasting's good margin potential and discretionary cash flow-generating capability; positive trends in Spanish-language population and advertising growth that have translated into earnings momentum; and the company's strong EBITDA margins, due partially to its favorable long-term contracts to purchase popular TV programming. UNIVISION COMM: Posts US$314.8 Million Net Loss in 2007 ------------------------------------------------------- Univision Communications Inc. posted a net loss of US$314.8 million for the full year of 2007, compared to net income of US$349.2 million in 2006. For the three months ended Dec. 31, 2007, the company incurred a US$201.5 million net loss compared to US$99.7 million of net income for the same period in 2006. For the fourth quarter, net revenue increased 6.1% to US$544.3 million in 2007 from US$512.8 million in 2006. Adjusted operating income before depreciation and amortization increased 10.9% to US$248.0 million in 2007 from US$223.7 million in 2006. For the full year 2007, net revenue increased 8.4% to US$2,072.8 million from US$1,912.0 million in 2006, excluding 2006 FIFA World Cup estimated incremental net revenues of US$113.6 million. Including World Cup incremental revenue in 2006, net revenue increased 2.3% and adjusted operating income before depreciation and amortization2 increased 7.8% to US$863.2 million in 2007 from US$800.6 million in 2006. Joe Uva, Chief Executive Officer, said, "2007 has been a tremendous year for Univision and Im incredibly proud of all we have achieved. From the smooth transition to new ownership, to reorganizing and refocusing our advertising sales structure, to implementing a host of initiatives to inform and educate our audience, we achieved many milestones while cementing Univisions position as the leading Spanish language media company." Mr. Uva continued, "During this quarter, Univision once again produced very strong results across all core platforms the Univision Network consistently outdelivered at least one of the other major networks in primetime among young adults, Univision Radio continued its double-digit year-over-year revenue growth and Univision.com maintained its position as the #1 Internet destination in the U.S. among Spanish-dominant and bilingual Hispanics. We look forward to building on the momentum gained in 2007 to drive growth in 2008 and beyond." Andrew W. Hobson, Senior Executive Vice President and Chief Financial Officer, said, "We are pleased with our fourth quarter net revenue growth of 6.1% and OBIDA growth of 10.9%. This continued growth further underscores the strength of our core businesses." About Univision Communications Headquartered in Los Angeles, Calif., Univision Communications Inc., (NYSE: UVN) -- http://www.univision.net/-- owns and operates more than 60 television stations in the U.S. and Puerto Rico offering a variety of news, sports, and entertainment programming. The company had about US$2.6 billion in debts at Dec. 31, 2006. Univision Music Group is a subsidiary of Univision Communications Inc. * * * Fitch Ratings has published a review of its Recovery Ratings methodology and updated analysis for rated issuers in the United States media and entertainment space including Univision Communication, Inc. (LT Issuer Default Rating at 'B'; Stable Outlook). Recovery Ratings are a relative indicator of recovery that bondholders would receive in the event of default. Recovery Ratings are applied to issuers with an Issuer Default Rating of 'B+' and below. USG CORP: Completes Payment to Asbestos Personal Injury Trust ------------------------------------------------------------- USG Corporation states that it has no further payment obligations to a trust created and funded under Section 524(g) of the U.S. Bankruptcy Code for the payment of all of the present and future asbestos personal injury liabilities of the company and its debtor-affiliates. The Company's plan of reorganization confirmed in 2006 resolved the Debtors' liability for all present and future asbestos personal injury and related claims, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 15, 2008. Under the Plan, the Company created and funded the trust. In 2006, the Company made payments totaling $3.95 billion to the asbestos personal injury trust. The asbestos personal injury trust is administered by independent trustees appointed under the Plan. The Asbestos Trust will pay qualifying asbestos personal injury and related claims against the Debtors pursuant to trust distribution procedures that are part of the confirmed Plan. A key component of the Company's Plan is the channeling injunction which provides that all present and future asbestos personal injury claims against the debtors must be brought against the trust and no one may bring such a claim against the Debtors. This channeling injunction applies to all present and future asbestos personal injury claims for which any Debtor is alleged to be liable, including any asbestos personal injury claims against U.S. Gypsum, L&W Supply or Beadex, as well as any asbestos personal injury claims against the Debtors relating to A.P. Green Refractories Co., which was formerly one of the Company's subsidiaries. The Company's Plan and the channeling injunction do not apply to any of its non-U.S. subsidiaries, any companies it acquired during its reorganization proceedings, or any companies that it acquired or may acquire after its emergence from reorganization. (USG Bankruptcy News, Issue No. 141; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). About USG Corporation Based in Chicago, Ill., USG Corporation -- http://www.usg.com/-- through its subsidiaries, manufactures and distributes building materials producing a wide range of products for use in new residential, new nonresidential and repair and remodel construction, as well as products used in certain industrial processes. The company filed for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No. 01-02094). When the Debtors filed for protection from their creditors, they listed $3,252,000,000 in assets and $2,739,000,000 in debts. The Debtors emerged from bankruptcy protection on June 20, 2006. * * * As reported in the Troubled Company Reporter on Feb. 29, 2008, Moody's Investors Service downgraded the debt ratings of USG 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. The ratings outlook is negative. As reported by the TCR on Feb. 1, 2008, USG reported fourth quarter 2007 net sales of $1.2 billion and a net loss of $28 million. USG CORP: Pays $40M for Property Damage Settlements in 2007 ----------------------------------------------------------- USG Corporation made total payments of about $40,000,000 in 2007 for asbestos property damage settlements, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 15, 2008. Asbestos property damage claims against the company were not part of the Asbestos Trust or the channeling injunction. The Company's Plan of Reorganization provided that all settled or otherwise resolved asbestos property damage claims that were timely filed in its reorganization proceedings would be paid in full. During the Company's reorganization proceedings, the Court established a deadline for filing asbestos property damage claims against the Debtors. About 1,400 asbestos property damage claims were timely filed. More than 950 of those claims were disallowed or withdrawn. In 2006 and 2007, the Company reached agreements to settle all of the open asbestos property damage claims filed in its reorganization proceedings. In 2006, the Company made total payments of about $99,000,000 for certain of those settlements. Based on its evaluation of the asbestos property damage settlements, the Company reversed $44,000,000 of its reserve for asbestos-related claims in 2006. The current estimate of the cost of the one remaining asbestos property damage settlement that has not yet been paid, and associated legal fees, is about $8,000,000 and is included in accrued expenses and other liabilities on the consolidated balance sheet as of December 31, 2007. (USG Bankruptcy News, Issue No. 141; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). About USG Corporation Based in Chicago, Ill., USG Corporation -- http://www.usg.com/-- through its subsidiaries, manufactures and distributes building materials producing a wide range of products for use in new residential, new nonresidential and repair and remodel construction, as well as products used in certain industrial processes. The company filed for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No. 01-02094). When the Debtors filed for protection from their creditors, they listed $3,252,000,000 in assets and $2,739,000,000 in debts. The Debtors emerged from bankruptcy protection on June 20, 2006. * * * As reported in the Troubled Company Reporter on Feb. 29, 2008, Moody's Investors Service downgraded the debt ratings of USG 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. The ratings outlook is negative. As reported by the TCR on Feb. 1, 2008, USG reported fourth quarter 2007 net sales of $1.2 billion and a net loss of $28 million. VILLA CASABLANCA: Case Summary & Eight Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Villa Casablanca, LLC 6721 West 121st Street, Suite 121 Overland Park, KS 66209 Tel: (913) 469 1199 Bankruptcy Case No.: 08-20473 Type of Business: The Debtor owns and manages real estate. Chapter 11 Petition Date: March 6, 2008 Court: District of Kansas (Kansas City) Debtor's Counsel: Alan Jeffrey Misler, Esq. (jmisler@mcdowellrice.com) McDowell, Rice, Smith, Buchanan 605 West 47th Street, Suite 350 Kansas City, MO 64112-1905 Tel: (816) 753-5400 Fax: (816) 753-9996 http://www.mcdowellrice.com/ Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtor's Eight Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ DLR trade $87,863 7290 West 133rd Street Overland Park, KS 66213 Cobb Cole trade $80,000 150 Magnolia Daytona Beach, FL 32115 SE Cline Construction trade $11,823 P.O. Box 354425 Palm Coast, FL 32114 PE Group trade $6,369 McMillen Land Surveying trade $2,550 Paymayesh Engineering trade $1,937 Old Florida Conservation trade $1,600 Hayword Brown trade $992 VOLT INFO: Inks New Credit Agreement for $42M Unsecured Facility ---------------------------------------------------------------- Volt Information Sciences Inc. entered into a new Credit Agreement, dated Feb. 28, 2007, with certain of its subsidiaries as guarantors, financial institutions as lenders, Bank of America N.A., as administrative agent, swing line lender and L/C issuer, and JPMorgan Chase Bank N.A., as syndication agent. The Credit Agreement established a $42.0 million unsecured credit facility in favor of the company, of which up to $15.0 million may be used for letters of credit. The Credit Agreement also provides the company with the right, subject to certain terms and conditions contained in the Credit Agreement, to increase the aggregate committed principal amount of the Credit Facility by an additional $25.0 million, to $67.0 million. The financial institutions participating in the Credit Facility include Bank of America, N.A., JPMorgan Chase Bank, N.A., Wells Fargo Bank, National Association, and HSBC Bank USA, National Association. The Credit Agreement provides for the company to comply with three specific financial covenants (a consolidated leverage ratio of not more than 3.0 to 1.0; a consolidated interest coverage ratio of at least 4.0 to 1.0; and a minimum consolidated tangible net worth requirement of not less than $160 million, increasing by an amount equal to 25.0% of the company's cumulative consolidated net income, to the extent positive, for fiscal periods after the close of the Borrower's 2007 fiscal year). The Credit Agreement also contains a variety of other affirmative and negative covenants. A full-text copy of the Credit Agreement, dated as of Feb. 28, 2008, is available for free at: http://researcharchives.com/t/s?28df About Volt Information Headquartered in New York City, Volt Information Sciences Inc. (NYSE: VOL) -- http://www.volt.com/-- provides national Staffing Services and Telecommunications and Information Solutions with a Fortune 100 customer base. Operating through a network of over 300 Volt Services Group branch offices, the Staffing Services segment fulfills IT and other technical, commercial and industrial placement requirements of its customers, on both a temporary and permanent basis. The Telecommunications and Information Solutions businesses, which include the Telecommunications Services, Computer Systems and Telephone Directory segments, provide complete telephone directory production and directory publishing; a full spectrum of telecommunications construction, installation and engineering services; and advanced information and operator services systems for telephone companies. * * * Volt Information Sciences Inc. continues to carry Fitch Ratings' 'BB' issuer default rating rating, which was placed in June 2006. VONAGE HOLDINGS: Reveals $1.4M Spending in Lobbying Activities -------------------------------------------------------------- Associated Press reports that Internet phone company Vonage Holdings Corp. spent nearly $1.4 million to lobby the federal government in 2007. The company reportedly revealed at its most recent disclosure of its lobbying activities that it spent more than $601,000 in the second half of the year lobbying on telecommunications competition and consumer issues. Associated Press obtained the information on a disclosure form posted online Feb. 13 by the Senate's public records office. The report noted that Vonage settled litigation with Nortel Networks in January. Last year, it agreed to pay AT&T Inc. $39 million to settle a patent suit. Vonage also settled lawsuits with Verizon Communications Inc. and Sprint Nextel Corp. for a total of $200 million in 2007. About Vonage Holdings Headquartered in Holmdel, New Jersey, Vonage Holdings Corp. (NYSE:VG) -- http://www.vonage.com/-- provides broadband telephone services with nearly 2.6 million subscriber lines. The company's Residential Premium Unlimited and Small Business Unlimited calling plans offer consumers unlimited local and long distance calling, and features like call waiting, call forwarding and voicemail for a flat monthly rate. Vonage's service is sold on the web and through national retailers including Best Buy, Circuit City, Wal-Mart Stores Inc. and Target and is available to customers in the U.S., Canada and the United Kingdom. At Dec. 31, 2007, the company had $465.0 million in total assets and $537.4 million in total liabilities, resulting in a $72.4 million total stockholders' deficit. VYTERIS INC: Receives $1,836,909 from Warrants Conversion --------------------------------------------------------- Vyteris Inc. disclosed in a regulatory filing Tuesday, that on Feb. 1, 2008, it temporarily reduced the exercise price of all of its outstanding warrants to $.20 and sent notification to all of its warrantholders to that effect. As of Feb. 1, 2008, the company had 57,973,807 warrants issued and outstanding. On Feb. 28, 2008, the company formally converted the warrants submitted pursuant to the warrant conversion program. The total number of warrants converted was 9,184,547 with gross proceeds of $1,836,909. Therefore, as of Feb. 28, 2008, 48,789,260 of the remaining warrants eligible for conversion remained issued and outstanding and reverted to their original terms. The company expects to record a non-cash expense in the first quarter of 2008 related to this conversion. About Vyteris Inc. Based in Fair Lawn, N.J., Vyteris Inc. (OTC BB: VYHN.OB) -- http://www.vyteris.com/-- fka. Vyteris Holdings (Nevada) Inc., is the maker of the first active drug delivery patch to receive marketing clearance from the U.S. Food and Drug Administration (FDA). Vyteris' proprietary active transdermal drug delivery (iontophoresis) technology delivers drugs comfortably through the skin using low-level electrical energy. This active patch technology allows precise dosing, giving physicians and patients control in the rate, dosage and pattern of drug delivery that can result in considerable therapeutic, economical, and lifestyle advantages over existing methods of drug administration. * * * Amper, Politziner & Mattia P.C., in Edison, N.J., expressed substantial doubt about Vyteris Holdings (Nevada) Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's recurring losses and dependence upon outside financing to fund operations. Vyteris Inc.'s consolidated balance sheet at Sept. 30, 2007, showed $9.8 million in total assets and $26.1 million in total liabilities, resulting in a $16.3 million total stockholders' deficit. WACHOVIA BANK: S&P Puts Six Low-B Ratings on Negative Watch ----------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on nine classes of commercial mortgage pass-through certificates from Wachovia Bank Commercial Mortgage Trust's series 2005-C20 on CreditWatch with negative implications. S&P placed these ratings on CreditWatch negative due to concerns about the fifth-largest loan, Macon & Burlington Mall Pool, which is secured by the fee and leasehold interests in two cross- collateralized and cross-defaulted regional malls. The loan was transferred to the special servicer, CWCapital Asset Management LLC, on Feb. 28, 2008, due to imminent default. Anchor and in- line tenants at both properties have vacated in recent months, causing occupancy and projected net cash flow to drop significantly from previously reported levels. The CreditWatch negative placements will remain in effect while Standard & Poor's monitors the loan workout process. The Burlington Mall is a 419,194-sq.-ft. mall in Burlington, North Carolina, with an allocated loan balance of $30.2 million. The property faces new competition from an upscale lifestyle property that recently opened nearby. Two anchors, J.C. Penney Co. (BBB- /Stable/--) and Belk Inc., vacated the property at year-end 2007. The remaining anchor, Sears, Roebuck and Co. (BB/Stable/--), leases 26% of the net rentable area, and its lease expires on July 16, 2009. Leases on 38% of the in-line space expire within the next 18 months. For the year ended Dec. 31, 2007, occupancy was 53%, and Standard & Poor's adjusted NCF for this property is down 68% from its level at issuance. The Macon Mall is a 762,398-sq.-ft. mall in Macon, Georgia, with an allocated loan balance of $108.3 million. The Macon Mall also faces new competition. One of the two anchor tenants at the property terminated its lease early in August 2007 and vacated the property. The master servicer, Wachovia Bank N.A., is currently holding the $4.2 million lease termination fee in escrow. The operating covenant of one of the remaining anchor tenants, which is not part of the collateral, has expired, and the anchor no longer has any obligation to remain at the property. If the anchor vacates, it will trigger co-occupancy clauses in the leases of the remaining tenants, which would allow them either to pay a reduced rent or vacate the property. For the year ended Dec. 31, 2007, the occupancy was 74%, and Standard & Poor's adjusted NCF for this property is down 35% from its level at issuance. Additionally, the borrower's equity interest in the property secures a $17.4 million senior mezzanine loan and a $9.5 million junior mezzanine loan. To date, CWCapital has not ordered a new appraisal. It is possible that a new appraisal will result in an appraisal reduction amount, which will cause appraisal subordinate entitlement reduction shortfalls. S&P will update or resolve the CreditWatch negative placements as more details concerning the workout process and property status become available. Ratings Placed on CreditWatch Negative Wachovia Bank Commercial Mortgage Trust Commercial mortgage pass-through certificates series 2005-C20 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ F BBB+/Watch Neg BBB+ 6.00% G BBB/Watch Neg BBB 5.04% H BBB-/Watch Neg BBB- 3.82% J BB+/Watch Neg BB+ 3.13% K BB/Watch Neg BB 2.73% L BB-/Watch Neg BB- 2.32% M B+/Watch Neg B+ 2.04% N B/Watch Neg B 1.77% O B-/Watch Neg B- 1.50% WALKUP FENCE: Case Summary & 17 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Walkup Fence, Inc. P.O. Box 25 McIntosh, FL 32664 Bankruptcy Case No.: 08-01182 Chapter 11 Petition Date: March 5, 2008 Court: Middle District of Florida (Jacksonville) Judge: Jerry A. Funk Debtor's Counsel: Lisa C Cohen, Esq. Ruff & Cohen PA 4010 Newberry Road Suite G Gainesville, FL 32607 Tel: (352) 376-3601 Fax: (352) 378-1261 mcourtruff@bellsouth.net Estimated Assets: $100,000 to $500,000 Estimated Debts: $1 million to $10 million Debtor's list of its 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Atlantic Coast Asphalt $105,000 P.O. Drawer 40949 Jacksonville, FL 32203 Ranger Construction Trade debt $95,000 Industries, Inc. P.O. Box 15065 West Palm Beach, FL 33416 Mercantile Bank Bank loan $48,036 P.O. Box 1440 Gainesville, FL 32602-1440 Perkins State Bank Bank loan $38,388 Internal Revenue Payroll tax $34,863 Merchant Metals Trade debt $31,028 CitiFinancial Auto $26,436 Collateral FMV $22,000 Colonial Pacific Trade debt $6,619 Hertz Equipment Trade debt $6,482 Master Halco $4,699 Financial Pacific $4,840 B&M Wood Products, Inc. $2,388 Days Inn Plant City $2,200 GE Capital One CPLC $2,172 Aruvil International, Inc. $1,399 Zambetti Steel $966 Bobcat of North $935 WELLS FARGO: S&P Junks Ratings on Certificates ---------------------------------------------- Standard & Poor's Ratings Services raised its ratings on 18 classes of mortgage pass-through certificates from five Wells Fargo Mortgage Backed Securities Trust transactions. At the same time, S&P lowered its ratings on 15 classes from nine different Wells Fargo Mortgage Backed Securities Trust transactions. S&P removed two of the lowered ratings from CreditWatch with negative implications. Concurrently, S&P placed the rating on an additional class on CreditWatch negative. Lastly, S&P affirmed its ratings on 846 other classes from various Wells Fargo Mortgage Backed Securities Trusts and Wells Fargo Alternative Loan Trusts. The raised ratings reflect a significant increase in credit support percentages due to the rapid paydown of principal, the shifting interest structure of the transactions, and minimal losses. Most of the upgraded deals have paid down to less than 37% of their original pool balances. Cumulative realized losses are very low for all of the upgraded series. Total delinquencies ranged from 0.00% (series 2002-1, and loan group 2 from series 2003-3) to 1.25% (series 2002-18) of the current pool balances. The lowered ratings reflect the deterioration of available credit support provided by the senior-subordinate structure of the transactions. Over the past six months, most of the downgraded deals have experienced spikes in dollar amount of loans in their delinquency pipelines, while realized losses have remained low. The affirmations are based on credit support percentages that are sufficient to support the ratings at their current levels. Subordination provides credit enhancement for the affected transactions. The collateral backing the certificates consists of prime jumbo, first-lien mortgage loans secured by one- to four-family residential properties. Ratings Raised Wells Fargo Mortgage Backed Securities Trust Mortgage pass-through certificates Rating ------ Series Class To From ------ ----- -- ---- 2002-1 B-3 AAA AA+ 2003-1 I-B-3 AA- A+ 2003-1 I-B-4 A- BBB+ 2003-1 I-B-5 BBB- BB+ 2003-1 II-B-3 AA AA- 2003-1 II-B-4 A+ A- 2003-1 II-B-5 BB- B 2003-2 B-3 AA A+ 2003-2 B-4 A BBB+ 2003-2 B-5 BBB- BB+ 2003-3 II-B-1 AAA AA+ 2003-3 II-B-2 AA+ AA 2003-3 II-B-3 A+ A- 2003-3 II-B-4 BBB+ BBB- 2003-3 II-B-5 BB+ BB- 2003-7 B-1 AA+ AA 2003-7 B-2 AA- A 2003-7 B-3 BBB+ BBB Ratings Lowered Wells Fargo Mortgage Backed Securities Trust Mortgage pass-through certificates Rating ------ Series Class To From ------ ----- -- ---- 2003-3 I-B-5 B- B 2003-10 B-4 B BB 2003-19 B-4 BB- BB 2003-19 B-5 CCC B 2003-E B-5 CCC B 2004-6 B-5 B- B 2004-7 B-4 B- BB 2004-I B-4 BB BB+ 2004-I B-5 CCC B 2004-T B-4 BB BB+ 2004-T B-5 CCC B 2004-U B-4 B+ BB 2004-U B-5 CCC B Ratings Lowered and Removed From CreditWatch Negative Wells Fargo Mortgage Backed Securities Trust Mortgage pass-through certificates Rating ------ Series Class To From ------ ----- -- ---- 2003-10 B-5 CCC B/Watch Neg 2004-7 B-5 CCC B/Watch Neg Rating Placed on CreditWatch Negative Wells Fargo Mortgage Backed Securities Trust Mortgage pass-through certificates Rating ------ Series Class To From ------ ----- -- ---- 2003-10 B-3 BBB/Watch Neg BBB Ratings Affirmed Wells Fargo Alternative Loan Trust Mortgage asset backed-pass-through certificates Series Class Rating ------ ----- ------ 2002-1 I-A-1,A-PO AAA Wells Fargo Mortgage Backed Securities Trust Mortgage pass-through certificates Series Class Rating ------ ----- ------ 2002-1 A-2,A-PO,B-1,B-2 AAA 2002-18 I-A-1,I-A-2,I-A-16,I-A-17,II-A-4,II-A-5 AAA 2002-18 II-A-18,II-A-WIO,A-PO,B-1,B-2 AAA 2002-18 B-3 AA+ 2002-20 A-4,A-5,A-PO,B-1,B-2 AAA 2002-20 B-3 AA+ 2002-22 I-A-9,I-A-12,II-A-4,II-A-10,II-A-PO AAA 2002-22 I-A-WIO,II-A-WIO,B-1,B-2,B-3 AAA 2003-1 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA 2003-1 I-A-8,I-A-9,I-A-10,II-A-7,II-A-8,II-A-9 AAA 2003-1 A-PO,I-B-1,II-B-1 AAA 2003-1 I-B-2,II-B-2 AA+ 2003-2 A-3,A-4,A-6,A-7,A-8,A-9,A-10,A-11,A-PO,B-1 AAA 2003-2 B-2 AA+ 2003-3 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA 2003-3 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA 2003-3 I-A-14,I-A-15,I-A-16,I-A-17,I-A-18,I-A-19 AAA 2003-3 I-A-20,I-A-21,I-A-22,I-A-23,I-A-24,I-B-1 AAA 2003-3 II-A-1,A-PO AAA 2003-3 I-B-2 AA 2003-3 I-B-3 A- 2003-3 I-B-4 BB+ 2003-6 I-A-1,I-A-PO,II-A-1,II-A-2,II-A-3,II-A-PO AAA 2003-6 B-1 AA+ 2003-6 B-2 A+ 2003-6 B-3 BBB+ 2003-6 B-4 BB+ 2003-6 B-5 B 2003-7 A-1,A-2,A-3,A-4,A-PO AAA 2003-7 B-4 BB 2003-7 B-5 B 2003-8 A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-9,A-PO AAA 2003-8 B-1 AA 2003-8 B-2 A 2003-8 B-3 BBB 2003-8 B-4 BB 2003-8 B-5 B 2003-9 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA 2003-9 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA 2003-9 I-A-14,I-A-15,I-A-16,A-PO,II-A-1 AAA 2003-10 A-1,A-2,A-3,A-4,A-PO AAA 2003-10 B-1 AA 2003-10 B-2 A 2003-11 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-8 AAA 2003-11 I-A-9,I-A-10,I-A-11,I-A-12,I-A-13,I-A-PO AAA 2003-11 II-A-1,II-A-PO AAA 2003-11 B-1 AA 2003-11 B-2 A 2003-11 B-3 BBB 2003-11 B-4 BB 2003-11 B-5 B 2003-12 A-1,A-2,A-3,A-PO AAA 2003-12 B-1 AA 2003-12 B-2 A 2003-12 B-3 BBB 2003-12 B-4 BB 2003-12 B-5 B 2003-13 A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-PO AAA 2003-13 B-1 AA 2003-13 B-2 A 2003-13 B-3 BBB 2003-13 B-4 BB 2003-13 B-5 B 2003-14 I-A-1,I-A-2,I-A-3,I-A-4,II-A-1,II-A-2,A-PO AAA 2003-14 B-1 AA 2003-14 B-2 A 2003-14 B-3 BBB 2003-14 B-4 BB 2003-14 B-5 B 2003-15 I-A-1,I-A-2,I-A-3,II-A-1,A-PO AAA 2003-15 B-1 AA 2003-15 B-2 A 2003-15 B-3 BBB 2003-15 B-4 BB 2003-15 B-5 B 2003-16 I-A-1,II-A-1,II-A-2,II-A-3,II-A-4,II-A-IO AAA 2003-16 III-A-1,III-A-2,A-PO AAA 2003-16 B-1 AA 2003-16 B-2 A 2003-16 B-3 BBB 2003-16 B-4 BB 2003-16 B-5 B 2003-17 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA 2003-17 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA 2003-17 I-A-14,I-A-IO,II-A-1,II-A-2,II-A-3,II-A-4 AAA 2003-17 II-A-5,II-A-6,II-A-7,II-A-8,II-A-9,II-A-10 AAA 2003-17 II-A-11,A-PO AAA 2003-17 B-1 AA 2003-17 B-2 A 2003-17 B-3 BBB 2003-17 B-4 BB 2003-17 B-5 B 2003-18 A-1,A-2,A-3,A-4,A-5,A-PO,A-R AAA 2003-18 B-1 AA 2003-18 B-2 A 2003-18 B-3 BBB 2003-18 B-4 BB 2003-18 B-5 B 2003-19 A-1,A-2,A-3,A-4,A-PO AAA 2003-19 B-1 AA 2003-19 B-2 A 2003-19 B-3 BBB 2003-A A-5,A-6,A-7,B-1 AAA 2003-A B-2 AA+ 2003-A B-3 A+ 2003-A B-4 BBB+ 2003-A B-5 BB- 2003-C A-4,A-5,A-6,A-7,A-8,A-9,B-1 AAA 2003-C B-2 AA 2003-C B-3 A+ 2003-C B-4 BBB 2003-C B-5 BB 2003-D A-1,B-1 AAA 2003-D B-2 AA 2003-D B-3 A 2003-D B-4 BBB- 2003-D B-5 B+ 2003-E A-1,A-2,A-3,A-4,A-WIO AAA 2003-E B-1 AA+ 2003-E B-2 A+ 2003-E B-3 BBB 2003-E B-4 BB 2003-F A-1 AAA 2003-F B-1 AA+ 2003-F B-2 A 2003-F B-3 BBB+ 2003-F B-4 BB 2003-F B-5 B 2003-G A-1,A-IO AAA 2003-G B-1 AA 2003-G B-2 A 2003-G B-3 BBB 2003-G B-4 BB 2003-G B-5 B 2003-H A-1 AAA 2003-H B-1 AA 2003-H B-2 A 2003-H B-3 BBB 2003-H B-4 BB 2003-H B-5 B 2003-J I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-7 AAA 2003-J I-A-8,I-A-9,I-A-10,I-A-11,I-A-12 AAA 2003-J II-A-1,II-A-2,II-A-3,II-A-4,II-A-5,II-A-6 AAA 2003-J II-A-7,III-A-1,III-A-2,III-A-3 AAA 2003-J IV-A-1,IV-A-2,IV-A-3,V-A-1 AAA 2003-J B-1 AA 2003-J B-2 A 2003-J B-3 BBB 2003-J B-4 BB 2003-J B-5 B 2003-K I-A-1,I-A-2,I-A-3,I-A-4,I-A-5 AAA 2003-K II-A-1,II-A-2,II-A-3,II-A-4,II-A-5,II-A-6 AAA 2003-K II-A-7,III-A-1,III-A-2,III-A-3,III-A-4 AAA 2003-K IV-A-1 AAA 2003-K B-1 AA 2003-K B-2 A 2003-K B-3 BBB 2003-K B-4 BB 2003-K B-5 B 2003-L I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,II-A-1 AAA 2003-L B-1 AA 2003-L B-2 A 2003-L B-3 BBB 2003-L B-4 BB 2003-L B-5 B 2003-M A-1,A-2,A-3 AAA 2003-M B-1 AA 2003-M B-2 A 2003-M B-3 BBB 2003-M B-4 BB 2003-M B-5 B 2003-N I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6 AAA 2003-N I-A-R,I-A-LR,II-A-1,II-A-2,II-A-3,II-A-4 AAA 2003-N III-A-1,III-A-2,III-A-3,III-A-4 AAA 2003-N B-1 AA 2003-N B-2 A 2003-N B-3 BBB 2003-N B-4 BB 2003-N B-5 B 2003-O I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6 AAA 2003-O I-A-7,I-A-8,I-A-9,I-A-10,I-A-11 AAA 2003-O II-A-1,II-A-2,II-A-3,III-A-1,III-A-2 AAA 2003-O III-A-3,IV-A-1,IV-A-2,V-A-1 AAA 2003-O B-1 AA 2003-O B-2 A 2003-O B-3 BBB 2003-O B-4 BB 2003-O B-5 B 2004-1 A-1,A-2,*A-3,A-4,A-5,A-6,A-7,A-8,A-9 AAA 2004-1 A-10,A-11,A-12,A-13,A-14,A-15,A-16,A-17 AAA 2004-1 A-18,A-19,A-20,A-21,A-22,A-23,A-24,A-25 AAA 2004-1 A-26,A-27,A-28,A-29,A-30,A-31,A-32,A-33 AAA 2004-1 A-34,A-35,A-36,A-37,A-39,A-PO,A-WIO AAA 2004-1 B-1 AA 2004-1 B-2 A 2004-1 B-3 BBB 2004-1 B-4 BB 2004-1 B-5 B 2004-2 A-1,A-PO AAA 2004-2 B-1 AA 2004-2 B-2 A 2004-2 B-3 BBB 2004-2 B-4 BB 2004-2 B-5 B 2004-3 A-1,A-PO AAA 2004-3 B-1 AA 2004-3 B-2 A 2004-3 B-3 BBB 2004-3 B-4 BB 2004-3 B-5 B 2004-5 I-A-1,I-A-PO,II-A-1,II-A-R,II-A-LR,II-A-PO AAA 2004-5 B-1 AA 2004-5 B-2 A 2004-5 B-3 BBB 2004-5 B-4 BB 2004-5 B-5 B 2004-6 A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-8,A-9,A-10 AAA 2004-6 A-11,A-12,A-13,A-14,A-15,A-16,A-PO,A-R AAA 2004-6 B-1 AA 2004-6 B-2 A 2004-6 B-3 BBB 2004-6 B-4 BB 2004-7 I-A-1,I-A-IO,I-A-R,I-A-LR,II-A-1,II-A-2,A-PO AAA 2004-7 B-1 AA 2004-7 B-2 A 2004-7 B-3 BBB 2004-8 A-1,A-2,A-3,A-4,A-5,A-6,A-R,A-PO AAA 2004-8 B-1 AA 2004-8 B-2 A 2004-8 B-3 BBB 2004-8 B-4 BB 2004-8 B-5 B 2004-A A-1 AAA 2004-A B-1 AA 2004-A B-2 A 2004-A B-3 BBB 2004-A B-4 BB 2004-A B-5 B 2004-B A-1 AAA 2004-B B-1 AA 2004-B B-2 A 2004-B B-3 BBB 2004-B B-4 BB 2004-B B-5 B 2004-C A-1 AAA 2004-C B-1 AA 2004-C B-2 A 2004-C B-3 BBB 2004-C B-4 BB 2004-C B-5 B 2004-CC A-1,A-R AAA 2004-CC B-1 AA 2004-CC B-2 A 2004-CC B-3 BBB 2004-CC B-4 BB 2004-CC B-5 B 2004-D A-1,A-2,A-IO AAA 2004-D B-1 AA 2004-D B-2 A 2004-D B-3 BBB 2004-D B-4 BB 2004-D B-5 B 2004-E A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-8,A-9 AAA 2004-E A-10,A-11 AAA 2004-E B-1 AA 2004-E B-2 A 2004-E B-3 BBB 2004-E B-4 BB 2004-E B-5 B 2004-EE I-A-1,II-A-1,II-A-2,II-A-3,II-A-R,II-A-LR AAA 2004-EE III-A-1,III-A-2,III-A-3 AAA 2004-EE B-1 AA 2004-EE B-2 A 2004-EE B-3 BBB 2004-EE B-4 BB 2004-EE B-5 B 2004-F A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-8,A-9 AAA 2004-F A-10,A-11 AAA 2004-F B-1 AA 2004-F B-2 A 2004-F B-3 BBB 2004-F B-4 BB 2004-F B-5 B 2004-G A-1,A-2,A-3,A-4 AAA 2004-G B-1 AA 2004-G B-2 A 2004-G B-3 BBB 2004-G B-4 BB 2004-G B-5 B 2004-H A-1,A-2 AAA 2004-H B-1 AA 2004-H B-2 A 2004-H B-3 BBB 2004-H B-4 BB 2004-H B-5 B 2004-I I-A-1,I-A-2,II-A-1,II-A-R,II-A-LR AAA 2004-I B-1 AA+ 2004-I B-2 A+ 2004-I B-3 BBB+ 2004-J A-1,A-R AAA 2004-J B-1 AA 2004-J B-2 A 2004-J B-3 BBB 2004-J B-4 BB 2004-J B-5 B 2004-K I-A-1,I-A-2,I-A-3,II-A-1,II-A-2 AAA 2004-K II-A-3,II-A-4,II-A-5,II-A-6,II-A-7 AAA 2004-K II-A-8,II-9,II-A-10,II-A-11,II-A-12 AAA 2004-K B-1 AA 2004-K B-2 A 2004-K B-3 BBB 2004-K B-4 BB 2004-K B-5 B 2004-L A-2,A-3,A-4,A-5,A-6,A-7,A-8,A-9,A-R AAA 2004-L B-1 AA 2004-L B-2 A 2004-L B-3 BBB 2004-L B-4 BB 2004-L B-5 B 2004-M A-1,A-3,A-4,A-5,A-6,A-7,A-8,A-R,A-LR AAA 2004-M B-1 AA 2004-M B-2 A 2004-M B-3 BBB 2004-M B-4 BB 2004-M B-5 B 2004-N A-3,A-4,A-5,A-6,A-7,A-8,A-9,A-R,A-LR AAA 2004-N A-R,A-LR AAA 2004-N B-1 AA 2004-N B-2 A 2004-N B-3 BBB 2004-N B-4 BB 2004-N B-5 B 2004-O A-1,A-R AAA 2004-O B-1 AA 2004-O B-2 A 2004-O B-3 BBB 2004-O B-4 BB 2004-O B-5 B 2004-P I-A-1,II-A-1,II-A-R,II-A-LR AAA 2004-P B-1 AA 2004-P B-2 A 2004-P B-3 BBB 2004-P B-4 BB 2004-P B-5 B 2004-Q I-A-1,I-A-2,I-A-3,II-A-1,II-A-2 AAA 2004-Q B-1 AA 2004-Q B-2 A 2004-Q B-3 BBB 2004-Q B-4 BB 2004-Q B-5 B 2004-R I-A-1,I-A-2,II-A-1,II-A-R,II-A-LR AAA 2004-R B-1 AA 2004-R B-2 A 2004-R B-3 BBB 2004-R B-4 BB 2004-R B-5 B 2004-S A-1,A-3,A-4,A-5,A-6,A-7,A-R AAA 2004-S B-1 AA 2004-S B-2 A 2004-S B-3 BBB 2004-S B-4 BB 2004-S B-5 B 2004-T A-1,A-R AAA 2004-T B-1 AA 2004-T B-2 A+ 2004-T B-3 BBB+ 2004-U A-1,A-R AAA 2004-U B-1 AA+ 2004-U B-2 A+ 2004-U B-3 BBB+ 2004-V I-A-1,I-A-2,I-A-3,I-A-R,I-A-LR,II-A-1 AAA 2004-V B-1 AA 2004-V B-2 A 2004-v B-3 BBB 2004-V B-4 BB 2004-V B-5 B 2004-X I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-R, AAA 2004-X I-A-LR,II-A-1,II-A-2 AAA 2004-X B-1 AA 2004-X B-2 A 2004-X B-3 BBB 2004-X B-4 BB 2004-X B-5 B 2004-Y I-A-1,I-A-2,I-A-3,II-A-1III-A-1 AAA 2004-Y III-A-2,III-A-3,III-A-4,III-A-5 AAA 2004-Y B-1 AA 2004-Y B-2 A 2004-Y B-3 BBB 2004-Y B-4 BB 2004-Y B-5 B 2004-Z I-A-1,I-A-2,II-A-1,II-A-2,II-A-IO,II-A-R AAA 2004-Z B-1 AA 2004-Z B-2 A 2004-Z B-3 BBB WILLIAM OWEN: Case Summary & 12 Largest Unsecured Creditors ----------------------------------------------------------- Debtors: William S. Owen Barbara J. Owen dba Owen Snow & Ice Removal Service 12251 Central Park Mt. Juliet, TN 37122 Bankruptcy Case No.: 08-01886 Chapter 11 Petition Date: March 5, 2008 Court: Middle District of Tennessee (Nashville) Judge: Keith M Lundin Debtors' Counsel: Steven L. Lefkovitz, Esq. Law Offices Lefkovitz & Lefkovitz 618 Church Street, Suite 410 Nashville, TN 37219 Tel: (615) 256-8300 Fax: (615) 250-4926 Stevelefkovitz@aol.com Estimated Assets: $1 million to $10 million Estimated Debts: $500,000 to $1 Million Debtors' list of their 12 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chase credit card $14,487 Chase CC Srvs/Attn: Bankruptcy Department P.O. Box 100018 Kennesaw, GA 30156 HSBC/GECC credit card $11,971 HSBC Card Srvs Attn: Bankruptcy P.O. Box 5213 Carol Stream, IL 60197 Capital 1 Bank credit card $3,063 Attn: C/O TSYS Debt Management P.O. Box 5155 Norcross, GA 30091 Wilson Co Trustee various property taxes $2,200 Citibank USA charge account $400 BP/Chase credit card $255 Watertown City Rcrdr $164 Sears/Citibank charge account $159 Target credit card $73 Shell Oil/Citibank credit card $52 Exxon Mobile/Citi credit card $51 Lowes/MBGA charge account $23 * S&P Downgrades Ratings on 23 Classes From Four 2005 RMBS Deals ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 23 classes of securities from four different residential mortgage- backed securities transactions issued in 2005. The lowered ratings reflect the collateral performance of the underlying pools as of the February 2008 remittance period. While these deals are 28 to 33 months seasoned, they have incurred substantial losses since issuance and continue to follow this trend. Current and projected credit support levels are no longer sufficient at the previous rating categories. As of the February 2008 remittance period, cumulative losses ranged from 1.81% (Fremont Home Loan Trust 2005-B) to 3.36% (Aegis Asset Backed Securities Trust 2005-3) of the original pool balances. Serious delinquencies (90-plus days, foreclosures, and REOs) have also increased more than 50% for each deal since the March 2007 remittance period. Serious delinquencies ranged from 34% to 36% of the current pool balances for the four transactions. Overcollateralization (O/C) had eroded for Aegis Asset Backed Securities Trust Mortgage Pass Through Certificates Series 2005-4 and is below target for the other three transactions. As of the latest remittance, three deals are failing their delinquency and cumulative loss triggers, but Fremont Home Loan Trust 2005-B is passing its cumulative loss trigger. A combination of subordination, excess spread, and O/C provides credit support to both transactions. The underlying collateral for the deals consists of subprime mortgage loans. Ratings Lowered 2005-CB6 Trust Rating ------ Class To From ----- -- ---- M-5 A AA- M-6 BBB- A+ B-1 BB- A B-2 B A- B-3 B- BBB+ B-4 CCC BBB B-5 CCC BBB- Aegis Asset Backed Securities Trust 2005-3 Rating ------ Class To From ----- -- ---- M5 BBB+ A M6 BB A- B1 B BBB+ B2 B- BBB B3 CCC BBB- Aegis Asset Backed Securities Trust Mortgage Pass Through Certificates Series 2005-4 Rating ------ Class To From ----- -- ---- M5 BBB- AA- M6 B+ A+ B1 B A+ B2 B- A B3 CCC BBB+ B4 CCC BBB B5 CCC BBB- B6 CCC B Fremont Home Loan Trust 2005-B Rating ------ Class To From ----- -- ---- M9 BBB- BBB M10 B BB+ M11 CCC B * Fitch Says US Auto-Loan ABS Performance Has Improved Slightly --------------------------------------------------------------- U.S. auto-loan ABS performance exhibited slight improvement last month in line with normal seasonal patterns, according to Fitch Ratings. Prime and subprime 60+ days or more delinquencies exhibited improvements in February compared to January, while annualized net losses rose further but at a slower pace compared to previous months. 'Despite weaker overall performance beginning in the second half of last year and into 2008, auto ABS ratings have remained stable to positive because the loss rates have remained within Fitch's original expectations,' Said Hylton Heard, a Director in Fitch's ABS group. 'Though Fitch expects the pace of auto ABS upgrades to slow, Fitch also does not anticipate a significant increase in downgrades.' In the prime sector, Fitch's prime 60+ days delinquency index posted the first monthly improvement since October 2007, dropping 2.6% to 0.75% in February versus January. Delinquencies remain 25% higher through February compared to the same period in 2007. Prime annualized net losses were 1.33% in February rising nearly 4% over January. Despite the slowdown in the index in February, ANL were 34% higher versus 2007 levels. Subprime 60+ days delinquencies dropped to 3.74% in February versus January, a 7% decline. February's delinquency rate was 40% higher than in the same period in 2007. ANL were at 8.54% in February, virtually unchanged versus January's level. The ANL rate in February was 30% higher versus February 2007. Fitch's indexes total approximately $67 billion of prime and subprime auto ABS transactions, of which 64%, or $43 billion, comprises of prime auto-loan transactions while the remaining $24 billion represents subprime transactions. Ratings of subprime auto ABS transactions have been affected by Fitch's downgrades of certain financial guarantors who provide insurance policies on these transactions. This has resulted in Fitch downgrading 14 subprime auto-loan and six rental-car transactions in the past six months. While incoming tax refunds and rebates may mute delinquency and loss rates in the short term, macroeconomic conditions impacting consumers combined with a softer used vehicle market will continue to pressure loss frequency and severity, and ultimately net loss rates. * Fitch Says Corp. Finance Rtng. Activity Shows Increased Stress ---------------------------------------------------------------- Global corporate finance rating activity continues to show increased signs of stress thus far in 2008 after turning negative in the second-half of 2007 under the weight of rapidly deteriorating housing market conditions, according to a Fitch Ratings review, which also points to further credit weakness for the remainder of the year. 'What began as a series of financial market events has begun to take a toll on credit conditions in the broader economy,' said William May, Senior Director, Fitch Credit Market Research 'This evolving story is reflected in corporate rating activity, which illustrates the expanding nature of the credit crisis.' Globally, the downgrade to upgrade ratio was 0.4 for the full year 2006 and then rose steadily over the first three quarters of 2007 before hitting 0.9:1.0 in fourth-quarter 2007. In Western Europe and North America the downgrade to upgrade ratio for the full year 2006 was 0.5:1.0 and 0.8:1.0, respectively, before rising to 1:1 in both regions for the full year 2007. For the 4Q'07, the downgrade to upgrade ratio in Western Europe and North America was 3:1 and 1.1:1, respectively. 'Through the first two months of 2008, Fitch's global rating activity indicates further deterioration in credit quality as downgrades exceeded upgrades by a ratio of 1.6:1', said Charlotte Needham, Senior Director, Fitch Credit Market Research. This decline was driven largely by activity in North America and Western Europe where the downgrade to upgrade ratios through February were 5.5:1 and 2:1, respectively. The most significant deterioration between 1H'07 and 2H'07 credit quality occurred in the financial sector as the ratio of global downgrades to upgrades among financial institutions rose to 0.9:1 in 4Q'07, up from 0.4:1 in the 3Q'07 and 0.3:1 for 1H'07. The effects of the credit market meltdown continued to exact a toll on North American and Western European financial firms in early 2008. Through February, the downgrade to upgrade ratio among North American and Western European financial institutions was 3.7:1 and 2.3:1, respectively. While financial institutions bore the brunt of the sub-prime related credit market meltdown in the latter half of 2007, ratings deterioration in late 2007 and early 2008 extended into the industrial sector as well. In the first two months of 2008, there were a total of 35 downgrades among North American industrials versus only 4 upgrades (a ratio of 8.8:1). Looking ahead, the majority of Fitch's Rating Outlooks remain Stable. However, the mix of Negative to Positive Rating Outlooks across industrial and financial credits in some regions - North America in particular - indicates the likelihood of meaningful deterioration in 2008. At the end of February 2008, for example, 20% of ratings on U.S. banks and financial institutions had a Negative Outlook, versus only 12% with a Positive Outlook. Across U.S. industrials, the mix of Negative to Positive Rating Outlooks was also negatively skewed but more balanced at 11% versus 8%, respectively. However, within some sectors, notably the building and construction industry and the basic materials industry, the Rating Outlook mix was more heavily tilted towards Negative. * Fitch Notes Rapid Deterioration in US Housing Market Conditions ----------------------------------------------------------------- Conditions in the U.S. housing market have deteriorated rapidly in the last several months according to Fitch Ratings, which has initiated an extensive review of Alternative-A transactions originated between 2005 and 2007. The review encompasses 417 Alt-A RMBS transactions, with an outstanding balance of approximately $160 billion. The RMBS under review have been placed on Rating Watch Negative. Fitch will release updated ratings for each deal as reviews are completed through the course of March and April. Fitch's review will first focus on the $10 billion of subordinate Alt-A RMBS which face substantial pressure from rising mortgage defaults. Fitch will subsequently analyze the 'AAA' rated securities which are better protected against default and loss in the mortgage pools. Fitch anticipates that its rating review of these securities will be substantively completed by April 30, 2008. 'Accelerating home price declines partly due to the recent dramatic contraction in the non-agency mortgage origination and securitization markets has been the primary catalyst of the Alt-A performance downturn,' said Managing Director and RMBS co-head Glenn Costello. 'This development has effectively eliminated the option to sell or refinance a home for many borrowers.' Serious delinquency levels for these Alt-A vintages have been rising rapidly in recent months. For the 2006 vintage, FRM transactions average 60+ day delinquencies have reached 6.4% for Fitch-rated deals and 8.6% for the market as a whole. For the 2006 vintage adjustable-rate mortgages, Fitch-rated 60+ day delinquencies are 9.6%. The market's delinquencies are 13.6%. While it should be noted that these delinquencies are much lower than those for subprime mortgages (2006 60+ day of 27%), they are substantially higher than historical Alt-A levels, which for Fitch-rated transactions averaged around 1%-2%. Fitch has been evaluating each of the rated deals since issuance and has taken rating actions on subordinate Alt-A classes from 199 2005-2007 transactions, reflecting the declining collateral performance. The review is a continuation of the on-going monitoring process. Fitch's RMBS analysis is based on a forecasted real home price decline of approximately 25% from peak home prices in 2006. As in the subprime market, although to a lesser degree, the willingness of Alt-A borrowers with high Loan-to-Value mortgages to 'walk away' from mortgage debt has contributed to high levels of early default. As Fitch has described in recent subprime RMBS commentary, this behavior appears to be largely attributable to the use of high risk mortgage products such as 'piggy-back' second liens and stated-income documentation programs, which in many instances were poorly underwritten and susceptible to borrower/broker fraud. While Alt-A mortgage pools represent a broad range of borrower and loan characteristics, these risk factors are present in many Alt-A transactions. Alt-A mortgage transactions are generally separated into two groups: those backed by ARMs and those backed by fixed-rate mortgages. Fitch's review encompasses 138 ARM and 279 FRM deals. Of the ARM deals, 21 are backed by pools of Pay-Option ARMS, the remainder are backed by hybrid ARMs. The distribution of transactions by vintage is 92 from 2005, 164 from 2006, and 161 from 2007. Positive factors that could influence Alt-A default and loss rates include declining interest rates and the recently enacted stimulus package. The combination of these factors should lead to greater liquidity in the mortgage market and help to limit additional home price declines. Preliminary revised estimates of the lifetime expected loss for Fitch-rated Alt-A FRM, as a percentage of original balance, are 1% for the 2005 vintage, 2.9% for the 2006 vintage and 3.4% for the 2007 vintage pools. These estimates reflect the very high delinquency rates currently being experienced, combined with expectations of continued stress due to declining home prices. Initial 'B' rating average loss expectations for fixed-rate transactions ranged from 0.3% in 2005 to 0.45 in 2007. For hybrid ARM pools, the loss estimates are 1.5% for 2005, 3.1% for 2006 and 4.1% for 2007. Initial 'B' rating average loss expectations for Fitch-rated hybrid ARMS ranged, from 0.4% in 2005 to 0.65% in 2007. These expectations were based on the historical performance of Alt-A quality mortgages. Investment grade ratings reflect credit enhancement designed to withstand substantial multiples to the 'B' expectation. Despite this protection, losses at the projected levels will put substantial pressure on subordinate classes, and will also put pressure on senior classes, most notably for the later 2006 and 2007 transactions. Fitch notes that many senior securities have structural features that provide significant protection against loss, and analysis of these features will be incorporated in Fitch's review. Fitch also recognizes that there are a number of risk factors at work, and that there remains considerable potential variance in the long term outcome. Fitch will be providing additional research and commentary on methodology for recent vintage Alt-A RMBS as part of the review process. Fitch has received requests to rate resecuritizations backed by classes from existing Alt-A RMBS deals. Fitch will not analyze proposed resecuritizations backed by Alt-A RMBS classes until the review is completed. * Moody's Comments on ABCP Program, Financial Guarantors Ratings ---------------------------------------------------------------- The rating implications of downgrades among the financial guarantors for asset-backed commercial paper (ABCP) programs will be assessed on a conduit-by-conduit basis, says Moody's Investors Service in a new report titled "ABCP and Financial Guarantors." In general, subject to appropriate liquidity, financial institutions such as financial guarantors with ratings in the A3- to-Aaa range can support Prime-1 short-term ratings on ABCP conduits. Financial guarantors may support an ABCP program in three ways, Moody's explains in the report, each with different rating implications. First, there are a few ABCP programs that are fully supported by a surety bond from a financial guarantor. Most fully-supported conduits also rely on means of support other than the financial guaranty, such as letters of credit or unconditional liquidity facilities, the majority of which are provided by the program sponsors. Second, in some programs, surety bonds from financial guarantors provide all or part of the program credit enhancement. Program- wide credit enhancement works as a secondary loss protection for investors, drawn on only after the first loss protection on each transaction is exhausted. Third, some conduits fund assets that are wrapped by surety bonds. The financial guarantor bears the risk that insufficient collections on assets will not fully reimburse the funding provided by the conduits. Moody's will therefore look initially to the rating of the financial guarantor to determine whether the transaction or the security is consistent with the rating of the conduit. "In all these cases, while the financial guarantor provides credit support, payment is fronted by some form of Prime-1 liquidity facility to ensure the timely payment of ABCP, as none of the surety providers have short-term ratings," says Moody's Robin Liu, author of the report. Ratings on ABCP programs depend on both the credit quality of the underlying assets and also that of the support providers, in addition to the rating of the liquidity provider. For a conduit to have a Prime-1 rating, the liquidity providers must be a Prime- 1 short-term rating. The financial guarantors do not have short- term ratings and are not the liquidity providers. * Moody's Says American, European Bond Protection Level Differs --------------------------------------------------------------- A comprehensive survey of investment-grade and high-yield bond covenants reveals significant regional differences in investor protection, says Moody's Investors Service. North American investment-grade bonds generally boast stronger bond covenants than do their European counterparts, while European high-yield bond indentures often offer investors greater protection than the North American versions. "The transatlantic divide manifests itself in wide-ranging ways," says Moody's Vice-President Alexander Dill. "But most intriguing is how covenant quality migrates to the European side of the Atlantic once one enters the high-yield space." Moody's analysis shows some striking differences in the level of covenant protection in North American and European investment- grade bonds. For example, US and Canadian investment-grade bonds typically have stand-alone covenant restrictions on mergers or asset sales, secured debt incurrence (negative pledge or limitation on liens) as well as sale or leaseback transactions. In contrast, says Moody's, while the negative pledger or limitation on liens (secured debt incurrence) covenant is usually present in European investment-grade bonds, the mergers or asset sales and sale or leaseback covenants are only infrequently included in issuance documentation. "The only exception appears to be change of control provisions," says Dill. Both regions have increasingly included change of control put options, and by 2007 they were present in over half of the North American and European bonds assessed by Moody's. On the flip side, the high-yield protections often absent from Ba- rated North American bonds are more likely to be found in high- yield European bonds throughout the speculative-grade space, notes Dill. These include important restrictions on borrowers' actions, such as limitations on restricted payments, incurrence of indebtedness and subsidiary borrowings and non-ordinary course asset dispositions. "Moreover, where these high-yield covenants are prevalent in both regions--in bonds rated single-B and below--the European bond covenants were generally stronger than in North America," says Dill. The key eight covenants identified by Moody's which protect against event risk and de-capitalization and which may be present in a covenant package are: restricted payments, change of control, merger restrictions, restrictions on asset sales, limitation on debt incurrence, negative pledge or limitation on liens, limitation on sale or leaseback transactions and limitation on subsidiary borrowing. Moody's evaluated over 350 individual covenant packages on 760 bonds issued from 1998 through 2007 for the study, Moody's first comprehensive analysis of regional differences in covenants across a number of rating categories. Moody's introduced its Covenant Quality Assessment research service in 2006 to provide investors with an informed opinion of covenant quality in response to increasing concerns about event risk and the absence of meaningful covenant protections in bond indentures. The service covers both existing bonds and bonds being marketed prior to pricing. The covenant service now covers over 900 debt securities. * Moody's Says ARS Issuers Could Avoid Credit Impact of Disruption ------------------------------------------------------------------ A large majority of public finance issuers currently participating in the auction rate securities (ARS) markets will be able to deal with the current disruptions without ratings implications provided that the market disruptions are not protracted, according to a new report from Moody's Investors Service. However, issuers with limited cash flows or narrow coverage who are unable to restructure their auction rate debt may face liquidity challenges which could impact ratings. "The primary effect on public finance issuers of current conditions in the ARS market is increased interest expense," said Moody's Vice President William Fitzpatrick, author of the report. "Existing interest rate hedges often are not effective in offsetting these increases." The potential for negative rating implications in the municipal sector due to ARS disruption was initially highlighted by Moody's in a February 20 report as the orderly functioning of the market as a whole became threatened by an absence of liquidity. The rating agency's latest report focuses exclusively on the public finance portion of the market, some $165.5 billion dollars or roughly 7% of the estimated $2.4 trillion public finance market. "In contrast to variable-rate demand obligations, which are municipal obligations that carry tender rights and are usually supported by an external liquidity facility, holders of auction bonds do not have a legal right to tender their bonds at par," explained Fitzpatrick. "However, investors often treated them as cash equivalents, partly because of the long- standing practice of broker-dealers entering bids in auctions at levels sufficient to clear the market, even though they had no obligation do so." He said the market for municipal ARS began to experience increases in average interest rate spreads in December as tightening credit markets caused investors to become increasingly concerned about the absence of tender rights. In some cases, concerns about monoline bond insurers contributed to pressure as investors sought to sell all insured bonds, including auction rate bonds. "Importantly, auction failures may occur despite the fact that the credit quality of the issuer remains strong," said Fitzpatrick When an auction 'fails' -- buy orders fall below a stated maximum rate needed to cover sell orders -- bond owners continue to hold the instruments as interest rates reset according to a formula set forth in the issue's legal documents. Although the failed auction rates vary widely, some failures have led to dramatic increases in interest rates. "While additional auctions may fail in coming weeks, additional buyers may emerge and a new equilibrium found, albeit at a reduced volume and with higher interest rate spreads," said Fitzpatrick. "Many issuers are also looking to convert their ARS to either fixed-rate bonds or alternative forms of floating rate securities such as variable rate demand obligations." He said the issuers face a number of challenges in converting to other modes, including technical tax issues, high levels of demand for additional liquidity support, and, in some cases, the need to unwind related interest rate swap agreements. * Global Default Rate Reaches 1.3% in February, Moody's Reports --------------------------------------------------------------- Moody's global speculative-grade default rate reached 1.3% at the end of February, from 1.1% in January, Moody's Investors Service reported. A year ago, the global speculative-grade default rate was 1.7%. "February is the third consecutive month in which the speculative- grade default rate has now increased," says Moody's Director of Corporate Default Research Kenneth Emery. In February 2007, the global spec-grade default rate was at 1.6%. Moody's default rate forecasting model now predicts that the global speculative-grade default rate will rise sharply to 5.4 % by the end of this year. It is expected to increase further to 6.1% a year from now. "The higher forecast this month reflects higher assumed paths for the US unemployment rate and high yield spread," says Emery. Last month, the model's 2008 year-end forecast was 4.6%. "Some factors which are not captured by the forecasting model suggest that the rise in default rates in 2008 may be more modest than projected by the Credit Transition Model," adds Emery, "In particular, re-funding risks are low given the prevalence of recent re-financing activity that entailed the issuance of long- maturity bank debt, often with weak maintenance covenants. Additionally, corporate liquidity measures appear to be strong relative to historical periods of sharply increasing default rates." Across industries, Moody's default rate forecasting model indicates that the Construction & Building sector will be the most troubled industry among U.S. issuers over the next 12 months. Moody's speculative-grade corporate distress index- which measures the percentage of rated issuers that have debt trading at distressed levels- marked a record new high since November 2002, rising to 21.7% in February from 18.9% in January. The index has been increasing sharply since last summer when it had been fluctuating in the 2.0% range. A total of four Moody's-rated corporate issuers defaulted in February. Of the four defaulters, three were by U.S. issuers and the fourth was domiciled in Canada. Measured on a dollar volume basis, the global speculative-grade bond default rate remained unchanged at 0.7% in February. A year ago, the global dollar-weighted bond default rate was 1.2%. Among U.S. speculative-grade issuers, the dollar-weighted bond default rate ended at 0.8% in February, also unchanged from January's level. At this time last year, the U.S. dollar-weighted bond default rate stood at 1.1%. In the leveraged loan market, three Moody's-rated loan issuers defaulted in January, all domiciled in the U.S. The trailing 12 month U.S. leveraged loan default rate rose to 1.2% in February from 0.8% in January. * S&P Downgrades 69 Tranches' Ratings From 14 Cash Flows and CDOs ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 69 tranches from 14 U.S. cash flow and hybrid collateralized debt obligation transactions. S&P removed 61 of the lowered ratings from CreditWatch with negative implications. Additionally, S&P affirmed its ratings on 10 tranches and removed them from CreditWatch negative. The downgraded tranches have a total issuance amount of $3.902 billion. Twelve of the 14 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 other two transactions are CDO of CDO transactions that were collateralized at origination primarily by notes from other CDOs, as well as by tranches from RMBS and other SF transactions. 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 2,287 tranches from 557 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, 1,165 ratings from 285 transactions are currently on CreditWatch negative for the same reasons. In all, S&P has downgraded $178.147 billion of CDO issuance. Additionally, S&P's ratings on $172.261 billion in securities have not been lowered but are currently on CreditWatch negative, indicating a high likelihood of downgrades. 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 ----------- ----- -- ---- 888 Tactical Fund Ltd. A1 CCC- AAA/Watch Neg 888 Tactical Fund Ltd. A2 CC AA+/Watch Neg 888 Tactical Fund Ltd. A3 CC BBB+/Watch Neg 888 Tactical Fund Ltd. A4 CC BB-/Watch Neg 888 Tactical Fund Ltd. S CCC AAA/Watch Neg Ayresome CDO I Ltd. A-2 AA AAA/Watch Neg Ayresome CDO I Ltd. A-3 AA AAA/Watch Neg Ayresome CDO I Ltd. B A- AA/Watch Neg Ayresome CDO I Ltd. C BBB+ A/Watch Neg Ayresome CDO I Ltd. Combo secs BB BBB-/Watch Neg Ayresome CDO I Ltd. D BB+ BBB/Watch Neg Capmark VI Ltd. C BBB BBB/Watch Neg Capmark VI Ltd. Income notes BB+ BB+/Watch Neg Commodore CDO III Ltd. B BBB+ AA Commodore CDO III Ltd. C-1 BB BBB/Watch Neg Commodore CDO III Ltd. C-2 BB BBB/Watch Neg Duke Funding VIII Ltd A-3F BBB+ A-/Watch Neg Duke Funding VIII Ltd A-3V BBB+ A-/Watch Neg Duke Funding VIII Ltd B BBB- BBB/Watch Neg Duke Funding VIII Ltd Comb sec 3 BBB- BBB/Watch Neg Duke Funding VIII Ltd Sub nts B- BB-/Watch Neg Duke Funding VIII Ltd. Comb sec 1 BBB- BBB-/Watch Neg Duke Funding VIII Ltd. Comb sec 2 BBB BBB/Watch Neg Dunhill ABS CDO Ltd A-2 AA AAA Dunhill ABS CDO Ltd B BBB AA Dunhill ABS CDO Ltd C B+ BBB/Watch Neg G-Star 2004-4 Ltd. C-1-A BBB BBB/Watch Neg G-Star 2004-4 Ltd. C-1-B BBB BBB/Watch Neg G-Star 2004-4 Ltd. Pref share BB BB/Watch Neg Halcyon Securitized Products A-1a A- AAA/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products A-1b BB- AAA/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products A-2 CCC+ AAA/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products B CCC AA/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products C CCC- A/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products D-1 CC BBB/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products D-2 CC BBB-/Watch Neg Investors ABS CDO II Ltd Halcyon Securitized Products E CC BB+/Watch Neg Investors ABS CDO II Ltd Inman Square Funding II Ltd. I AAA AAA/Watch Neg Inman Square Funding II Ltd. II AA- AA/Watch Neg Inman Square Funding II Ltd. III-fltg BBB+ A/Watch Neg Inman Square Funding II Ltd. III-fxd BBB+ A/Watch Neg Inman Square Funding II Ltd. IV BBB- BBB/Watch Neg Inman Square Funding II Ltd. V BB- BB+/Watch Neg Ischus Mezzanine CDO IV Ltd. A-1 BBB- AAA/Watch Neg Ischus Mezzanine CDO IV Ltd. A-2 B AA+/Watch Neg Ischus Mezzanine CDO IV Ltd. A-3 CCC+ A-/Watch Neg Ischus Mezzanine CDO IV Ltd. B CC CCC+/Watch Neg Ischus Mezzanine CDO IV Ltd. SprSrSwap A+srs AAAsrs/Watch Neg Ischus Mezzanine CDO IV Ltd. X AAA AAA/Watch Neg IXIS ABS CDO 1 Ltd. A-1LB AA AAA IXIS ABS CDO 1 Ltd. A-2L A- AA IXIS ABS CDO 1 Ltd. A-3L BBB- A/Watch Neg IXIS ABS CDO 1 Ltd. B-1L BB+ BBB/Watch Neg IXIS ABS CDO 1 Ltd. B-2L BB- BB+/Watch Neg Long Hill 2006-1 Ltd. A1 AA AAA/Watch Neg Long Hill 2006-1 Ltd. A2 BB A/Watch Neg Long Hill 2006-1 Ltd. A3 CCC+ BBB-/Watch Neg Long Hill 2006-1 Ltd. B CC BB-/Watch Neg Long Hill 2006-1 Ltd. C CC B+/Watch Neg Long Hill 2006-1 Ltd. Combo nts CC CCC+/Watch Neg Long Hill 2006-1 Ltd. S2T AA+ AAA/Watch Neg Long Hill 2006-1 Ltd. S1VF AAA AAA/Watch Neg Mars CDO I Ltd. A-1 B AAA Mars CDO I Ltd. A-2 CC AAA/Watch Neg Mars CDO I Ltd. A-3 CC AAA/Watch Neg Mars CDO I Ltd. B CC AA/Watch Neg Mars CDO I Ltd. C CC AA-/Watch Neg Mars CDO I Ltd. D CC A/Watch Neg Mars CDO I Ltd. F CC BBB/Watch Neg Neptune CDO III Ltd. A-2 A+ AAA/Watch Neg Neptune CDO III Ltd. A-3 BBB+ AA/Watch Neg Neptune CDO III Ltd. B BBB- A/Watch Neg Neptune CDO III Ltd. C B+ BB+/Watch Neg South Coast Funding II Ltd. A-2 BBB+ AA/Watch Neg South Coast Funding II Ltd. A-3 B- B/Watch Neg Vertical ABS CDO 2005-1 Ltd. A-2 AA+ AAA Vertical ABS CDO 2005-1 Ltd. B A- AA Vertical ABS CDO 2005-1 Ltd. C BBB A/Watch Neg Vertical ABS CDO 2005-1 Ltd. D BB- BBB/Watch Neg Other Outstanding Ratings Transaction Class Rating ----------- ----- ------ 888 Tactical Fund Ltd. B CC 888 Tactical Fund Ltd. C CC Ayresome CDO I Ltd. A-1a AAA Ayresome CDO I Ltd. A-1b AAA Capmark VI Ltd. A-1 AAA Capmark VI Ltd. A-2 AA Capmark VI Ltd. B A- Capmark VI Ltd. Cred facility AAA Commodore CDO III Ltd. A-1A AAA Commodore CDO III Ltd. A-1B AAA Commodore CDO III Ltd. A-1C AAA Commodore CDO III Ltd. A-2 AAA Duke Funding VIII Ltd A-1J AAA Duke Funding VIII Ltd A-1S AAA Duke Funding VIII Ltd A-2 AA Dunhill ABS CDO Ltd A-1NV AAA Dunhill ABS CDO Ltd A-1VA AAA Dunhill ABS CDO Ltd A-1VB AAA G-Star 2004-4 Ltd. A-1 AAA G-Star 2004-4 Ltd. A-2-A AA G-Star 2004-4 Ltd. A-2-B AA G-Star 2004-4 Ltd. B A- Ischus Mezzanine CDO IV Ltd C CC Ischus Mezzanine CDO IV Ltd D CC IXIS ABS CDO 1 Ltd. X AAA Neptune CDO III Ltd A-1 AAA Neptune CDO III Ltd S AAA South Coast Funding II Ltd. A-1 AAA Vertical ABS CDO 2005-1 Ltd. A-1 AAA Vertical ABS CDO 2005-1 Ltd. Combo Sec AAA * S&P Puts Ratings on 115 Classes of NIMS on Negative CreditWatch ----------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on 115 classes of U.S. net interest margin securities (NIMS) from 56 transactions backed by U.S. first-lien Alternative-A mortgage securities on CreditWatch with negative implications. The CreditWatch actions follow the Feb. 29, 2008, placements of the ratings on the underlying securities on CreditWatch with negative implications. Alt-A loans are first-lien residential mortgages that generally conform with traditional "prime" credit guidelines. However, the loan-to-value ratio, loan documentation, occupancy status, property type, or other factors prevent these loans from qualifying under standard underwriting programs for prime jumbo and prime-quality conforming loans. This review includes transactions backed by payment option ARM (adjustable-rate mortgage) residential mortgage loans, which have, as a subgroup of Alt-A, exhibited lower severe delinquency rates and have greater credit protection than the average for the entire Alt-A sector. The primary source of payments to the associated NIMS is the difference between the interest payments collected on the mortgages in the underlying transaction(s) and the interest owed to the related RMBS, together with prepayment penalties and potential payments from derivative contracts. The current levels of delinquencies and losses occurring in the Alt-A mortgage market have significantly reduced the levels of excess interest available to some of the NIMS. This CreditWatch actions affect a total of 56 U.S. Alt-A RMBS NIMS transactions. The 115 Alt-A NIMS classes with ratings placed on CreditWatch have a current balance of approximately $501 million, which represents roughly 44% of their approximate $1,145 million original balance. The CreditWatch actions on these 115 classes of U.S. Alt-A RMBS NIMS are spread across the various rating categories: Rating No. of Orig. cert. percentage of total category Watch actions bal. actions by bal. -------- ------------- ----------- ------------------- AA 1 10,585,000 0.92% A+ 1 14,000,000 1.22% A 8 152,045,286 13.28% A- 9 254,961,000 22.26% BBB 11 50,780,000 4.43% BBB- 25 307,760,000 26.88% BB 34 204,678,900 17.87% BB- 4 25,161,000 2.20% B 20 113,159,000 9.88% B- 2 12,021,000 1.05% Impact On ABCP, SIVs, And CDOs Standard & Poor's has performed a global review of its rated asset-backed commercial paper conduits with exposure to the U.S. NIMS classes with ratings placed on CreditWatch negative. S&P's review shows that this CreditWatch actions do not adversely affect the ratings on these ABCP conduits. Standard & Poor's has also completed a review of all the structured investment vehicle and SIV-lite structures it rates with regard to exposure to U.S. NIMS classes with ratings placed on CreditWatch. In S&P's view, no rated SIV or SIV-lite structure has exposure to the affected U.S. NIMS classes, and therefore this CreditWatch actions do not adversely affect S&P's ratings on SIVs and SIV-lites. Standard & Poor's has also completed its global review of the collateralized debt obligation transactions it rates with regard to exposure to the U.S. NIMS classes with ratings placed on CreditWatch. S&P's review shows that this CreditWatch actions will have no impact on the ratings on S&P's publicly rated CDO transactions. It is possible that the ratings on classes not included in this CreditWatch action could be adversely affected at the conclusion of S&P's analysis. Ratings Placed on CreditWatch Negative Banc of America Fdg Corp. 2006-NIM1 Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-NIM1 Notes B/Watch Neg B CMO Holdings II Ltd. Rating ------ Series Class To From ------ ----- -- ---- 2006-16 IV-A-3 BB-/Watch Neg BB- 2006-16 IV-A-4 B-/Watch Neg B- 2006-9 A-3 BB/Watch Neg BB CMO Holdings III Ltd. Rating ------ Series Class To From ------ ----- -- ---- 2006-19 I-A-2 BBB/Watch Neg BBB 2006-19 I-A-3 BB/Watch Neg BB 2006-19 I-A-4 B/Watch Neg B 2006-20 IV-A-2 BBB/Watch Neg BBB 2006-20 II-A-4 BB/Watch Neg BB 2006-20 IV-A-3 BB/Watch Neg BB 2006-20 V-A-3 BB/Watch Neg BB 2006-20 IV-A-4 B/Watch Neg B 2006-20 V-A-4 B/Watch Neg B 2006-22 II-A-4 BB/Watch Neg BB 2006-24 I-A-1 A/Watch Neg A 2006-24 VIII-A-1 A/Watch Neg A 2006-24 I-A-2 BBB/Watch Neg BBB 2006-24 II-A-2 BBB/Watch Neg BBB 2006-24 IX-A-2 BBB/Watch Neg BBB 2006-24 VIII-A-2 BBB/Watch Neg BBB 2006-24 I-A-3 BB/Watch Neg BB 2006-24 II-A-3 BB/Watch Neg BB 2006-24 IX-A-3 BB/Watch Neg BB 2006-24 VI-A-3 BB/Watch Neg BB 2006-24 VIII-A-3 BB/Watch Neg BB 2006-24 I-A-4 B/Watch Neg B 2006-24 II-A-4 B/Watch Neg B 2006-24 IX-A-4 B/Watch Neg B 2006-24 VI-A-4 B/Watch Neg B 2006-24 VIII-A-4 B/Watch Neg B 2007-N2 II-A-1 A/Watch Neg A 2007-N2 II-A-2 BBB/Watch Neg BBB 2007-N2 VII-A-1 BBB/Watch Neg BBB 2007-N2 II-A-3 BB/Watch Neg BB 2007-N2 III-A-3 BB/Watch Neg BB 2007-N2 V-A-3 BB/Watch Neg BB 2007-N2 II-A-4 B/Watch Neg B 2007-N2 III-A-4 B/Watch Neg B 2007-N2 V-A-4 B/Watch Neg B 2007-N3 II-A-2 BBB/Watch Neg BBB 2007-N3 I-A-3 BB/Watch Neg BB 2007-N3 II-A-3 BB/Watch Neg BB 2007-N3 I-A-4 B/Watch Neg B 2007-N3 II-A-4 B/Watch Neg B Countrywide Alternative Loan Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-OC7N Notes BB-/Watch Neg BB- 2006-OC8N Notes BBB-/Watch Neg BBB- Countrywide CWALT Rating ------ Series Class To From ------ ----- -- ---- 2006-OA11N N-2 BBB-/Watch Neg BBB- 2006-OA11N N-3 BB/Watch Neg BB 2006-OA16N N-2 BBB-/Watch Neg BBB- 2006-OA16N N-3 BB/Watch Neg BB 2006-OA18N N-2 BBB-/Watch Neg BBB- 2006-OA18N N-3 BB/Watch Neg BB 2006-OA6N N-2 Notes BBB-/Watch Neg BBB- 2006-OA6N N-3 Notes BB/Watch Neg BB 2007-AH1N N-1 A-/Watch Neg A- 2007-AH1N N-2 BBB-/Watch Neg BBB- 2007-AH1N N-3 BB/Watch Neg BB Countrywide Home Loan Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-12N Notes BBB-/Watch Neg BBB- 2006-IM1N Notes A-/Watch Neg A- Credit Suisse NIMs Trust RALI 2007-QO1 NIM1 Rating ------ Series Class To From ------ ----- -- ---- 2007-QO1 NIM1 A Notes A-/Watch Neg A- 2007-QO1 NIM1 B Notes BBB-/Watch Neg BBB- DBARN Net Interest Margin 2007-AR1N Rating ------ Series Class To From ------ ----- -- ---- 2007-AR1N N-1 A-/Watch Neg A- 2007-AR1N N-2 BBB-/Watch Neg BBB- 2007-AR1N N-3 BB/Watch Neg BB DSLA NIM CI-2 Corp. Rating ------ Series Class To From ------ ----- -- ---- 2006-1 N-3 Notes BB/Watch Neg BB GSAA Rating ------ Series Class To From ------ ----- -- ---- 2006-NIM3 N2 BB/Watch Neg BB 2006-NIM6 N2 B-/Watch Neg B- 2006-NIM8 N1 A/Watch Neg A 2006-NIM8 N2 BB/Watch Neg BB 2007-NIM1 N1 A/Watch Neg A 2007-NIM1 N2 BBB-/Watch Neg BBB- 2007-NIM4 N1 A/Watch Neg A 2007-NIM4 N2 BBB-/Watch Neg BBB- GSAA Home Equity Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-NIM5 N1 A/Watch Neg A 2007-NIM3 Notes A/Watch Neg A Harborview NIM CI-1 Corp. Rating ------ Series Class To From ------ ----- -- ---- 2006-BU1 N-3 Notes BB/Watch Neg BB Impac NIM Trust Rating ------ Series Class To From ------ ----- -- ---- 2007-1 N BBB-/Watch Neg BBB- 2007-1 N BBB-/Watch Neg BBB- 2007-3 N BBB-/Watch Neg BBB- IndyMac INDX NIM CI-1 Corp. Rating ------ Series Class To From ------ ----- -- ---- 2006-AR6 N-1 A-/Watch Neg A- 2006-AR6 N-2 BBB-/Watch Neg BBB- 2006-AR6 N-3 BB/Watch Neg BB Lehman XS NIM 1 Co. 2006-10N Rating ------ Series Class To From ------ ----- -- ---- 2006-10N A-1 A-/Watch Neg A- 2006-10N A-2 BBB-/Watch Neg BBB- 2006-10N A-3 BB/Watch Neg BB Lehman XS NIM Co. 2006-9 Rating ------ Series Class To From ------ ----- -- ---- 2006-9 A B/Watch Neg B Lehman XS NIM Co. 2006-AR8 Rating ------ Series Class To From ------ ----- -- ---- 2006-AR8 A-2 Notes BBB-/Watch Neg BBB- 2006-AR8 A-3 Notes BB-/Watch Neg BB- 2006-AR8 A-4 Notes B/Watch Neg B MASTR Alternative Loan NIM Rating ------ Series Class To From ------ ----- -- ---- 2006-2 N-1 Notes BBB-/Watch Neg BBB- 2006-6 S-1 B/Watch Neg B 2006-6 S-2 B/Watch Neg B 2007-HF1 A AA/Watch Neg AA MLMI Cayman NIM 2006-OA1 Ltd. Rating ------ Series Class To From ------ ----- -- ---- 2006-OA1 N2 BBB-/Watch Neg BBB- 2006-OA1 N3 BB-/Watch Neg BB- NAAC NIM 2006-AR4 Rating ------ Series Class To From ------ ----- -- ---- 2006-AR4 N1 BB/Watch Neg BB NAAC Trust NIM 2006-AR3 Rating ------ Series Class To From ------ ----- -- ---- 2006-AR3 Notes BBB-/Watch Neg BBB- Opteum NIM Trust Rating ------ Series Class To From ------ ----- -- ---- Opteum NIM Trust 2006-1 N BBB-/Watch Neg BBB- Opteum NIM Trust 2006-2 N BBB-/Watch Neg BBB- Ownit 2006-1NIM Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-1NIM Notes A-/Watch Neg A- PHHAM Net Interest Margin Trust 2007-1N Rating ------ Series Class To From ------ ----- -- ---- 2007-1N Notes BBB/Watch Neg BBB RALI 2006-QA7 NIMS Ltd. Rating ------ Series Class To From ------ ----- -- ---- A NIM Note BB/Watch Neg BB RALI 2006-QA8 NIMS Ltd. Rating ------ Series Class To From ------ ----- -- ---- A NIM Note BB/Watch Neg BB RALI NIM CI-1 Corp. Rating ------ Series Class To From ------ ----- -- ---- 2006-QO4 N-1 Notes A-/Watch Neg A- 2006-QO4 N-2 Notes BBB-/Watch Neg BBB- 2006-QO4 N-3 Notes BB/Watch Neg BB Sharps SP I LLC Net Interest Margin Trust Rating ------ Series Class To From ------ ----- -- ---- 2006-AR2N Notes A-/Watch Neg A- 2006-AR4N N-2 BB/Watch Neg BB 2006-AR4N N-3 B/Watch Neg B 2006-AR5N N-1 BB/Watch Neg BB 2006-AR5N N-2 B/Watch Neg B 2006-CW1N Notes A+/Watch Neg A+ Terwin Cayman NIM Ltd. Rating ------ Series Class To From ------ ----- -- ---- TMTS 2006-7 N BBB-/Watch Neg BBB- 2006-9 N BBB/Watch Neg BBB 2007-2 N-2 Notes BBB-/Watch Neg BBB- * Jean L'Homme Joins Proskauer Rose as Banking & Finance Partner ---------------------------------------------------------------- Jean L'Homme, Esq., an experienced banking and finance lawyer, has joined Proskauer Rose LLP as a partner in Paris. Mr. L'Homme has particular experience in financial services regulatory matters and project finance. He regularly advises major investment and commercial banks, hedge funds, insurance companies, and investment service providers on regulatory issues affecting their businesses and transactions both in France and internationally, well as governments and governmental agencies around the world on the financing of infrastructure projects, including many of the recent, high-profile projects in France and North Africa. "We are extremely excited to add Jean to our corporate practice and integrate his significant capabilities into our international platform, which encompasses a growing range of transactional, fund formation, financing, and regulatory work across Europe and around the world," Yasmine Tarasewicz, head of Proskauer's Paris office," said. "His presence will enable us to continue our international expansion and demonstrates our continued ability to attract the region's top legal talent." Mr. L'Homme is the latest addition to Proskauer's Paris-based corporate practice, which recently welcomed one of Europe's most prominent groups of private equity lawyers, led by Daniel Schmidt and Olivier Dumas. The firm also disclosed the continued expansion of its new London office with the addition of William Yonge, an experienced securities regulation and funds lawyer, who joined as partner. Mr. L'Homme joins Proskauer from the Paris office of Freshfields Bruckhaus Deringer, where he was head of the firm's Finance and Regulatory/Financial Services groups. He received his Business and Tax Law degree from University of Paris II and is also a graduate of the University of La Reunion. Proskauer's Paris office provides legal advice to businesses and entities in France, the European Union. Its core practices include: general corporate transactions such as mergers and acquisitions, private equity, corporate restructurings, and joint ventures; commercial law including competition law matters, distribution, and licensing; labor law, with a particular emphasis on large corporate reorganizations and litigation; tax including international taxation of companies and individuals, tax structuring of corporate transactions and investment funds, and personal tax planning; and commercial litigation including appearances before various French courts and international arbitration tribunals and acting as "instructing solicitor" in cases before courts and jurisdictions in which the firm is not admitted. About Proskauer Rose Headquartered in New York City, Proskauer Rose LLP -- http://www.proskauer.com/-- is a law firm that provides a variety of legal services to clients throughout the United States and around the world from offices in New York, Los Angeles, Washington, D.C., Boston, Boca Raton, Newark, New Orleans, Paris and Sao Paulo. Founded in 1875, the firm has experience in all areas of practice important to businesses and individuals, including corporate finance, mergers and acquisitions, general commercial litigation, private equity and fund formation, patent and intellectual property litigation and prosecution, labor and employment law, real estate transactions, bankruptcy and reorganizations, trusts and estates, and taxation. Its clients span industries including chemicals, entertainment, financial services, health care, information technology, insurance, internet, lodging and gaming, manufacturing, media and communications, real estate investment, pharmaceuticals, sports, and transportation. The firm has more than 750 lawyers. * Proskauer Rose Admits Jennifer A. Camacho as Partner in Boston ---------------------------------------------------------------- Jennifer A. Camacho, an experienced biotechnology and intellectual property lawyer, has joined Proskauer Rose LLP as a partner in Boston. Ms. Camacho joins Proskauer from Codon Devices Inc., an international biotechnology company headquartered in Cambridge, Massachusetts, where she was chief patent counsel and vice president of intellectual property. Ms. Camacho will be a key member of the firm's Patent Law and Life Sciences practice groups. "Jennifer's broad experience both as a lawyer and an important contributor to the strategic direction of one of New England's cutting-edge biotechnology companies will be invaluable to us as we continue to expand our nationwide intellectual property capabilities," Steven M. Ellis, partner and head of Proskauer's Boston office, said. "She brings to the table deep, real-company experience that will be a highly-leveragable asset to our rapidly- growing life sciences client base." At Codon Devices, a company in the field of synthetic biology, Ms. Camacho was responsible for the strategic development and implementation of the company's intellectual property portfolio. In addition, Ms. Camacho worked closely with the company's research and development group, structuring third-party collaborative relationships and providing intellectual property guidance in connection with the company's product development initiatives across a wide variety of market applications. As a member of Codon Devices' executive management team, Ms. Camacho also provided cross-functional, hands-on general counsel throughout the organization. Prior to joining Codon, Ms. Camacho was an associate in Proskauer's Patent Practice Group. She received her J.D. from Boston College Law School and her B.S. in Cell and Structural Biology from the University of Illinois. In addition, she served as a research assistant in molecular biology and genetic engineering at Harvard University and the University of Illinois. Ms. Camacho is the latest addition to Proskauer's Boston office, which was named the area's fastest-growing law firm office by Boston Business Journal for the third consecutive year. The firm's Life Sciences Practice Group works with companies and organizations at all stages, with a client roster that includes venture-backed companies and top universities in addition to many of the world's largest pharmaceutical, medical device, biotechnology, and healthcare services companies. The firm's Patent Practice Group forms a significant part of the firm's Intellectual Property Group and includes over 60 lawyers who specialize in patent and technology-related litigation, patent counseling, licensing and technology transfer, and patent procurement. About Proskauer Rose Headquartered in New York City, Proskauer Rose LLP -- http://www.proskauer.com/-- is a law firm that provides a variety of legal services to clients throughout the United States and around the world from offices in New York, Los Angeles, Washington, D.C., Boston, Boca Raton, Newark, New Orleans, Paris and Sao Paulo. Founded in 1875, the firm has experience in all areas of practice important to businesses and individuals, including corporate finance, mergers and acquisitions, general commercial litigation, private equity and fund formation, patent and intellectual property litigation and prosecution, labor and employment law, real estate transactions, bankruptcy and reorganizations, trusts and estates, and taxation. Its clients span industries including chemicals, entertainment, financial services, health care, information technology, insurance, internet, lodging and gaming, manufacturing, media and communications, real estate investment, pharmaceuticals, sports, and transportation. The firm has more than 750 lawyers. * BOND PRICING: For the Week of Feb. 25 - Feb. 29, 2008 ------------------------------------------------------- Issuer Coupon Maturity Price ------ ------ -------- ----- Acme Metals Inc 12.500% 08/01/02 0 Advanced Med Opt 3.250% 08/01/26 74 Advanced Med Opt 3.250% 08/01/26 74 Albertson's Inc 6.520% 04/10/28 69 Albertson's Inc 6.530% 04/10/28 69 Albertson's Inc 6.560% 07/26/27 70 Albertson's Inc 6.570% 02/23/28 69 Albertson's Inc 6.630% 06/02/28 70 Albertson's Inc 7.110% 07/22/27 75 Albertson's Inc 7.150% 07/23/27 75 Aleris Intl Inc 10.0005 12/15/16 71 Alesco Financial 7.625% 05/15/27 65 Alion Science 10.250% 02/01/15 68 Allegiance Tel 12.875% 05/15/08 1 Alltel Corp 6.800% 05/01/29 67 Alltel Corp 7.875% 07/01/32 72 Ambac Inc 5.950% 12/05/35 65 Ambac Inc 6.150% 02/15/37 50 Ambassadors Intl 3.750% 04/15/27 71 AMD 6.000% 05/01/15 71 AMD 6.000% 05/01/15 71 Amer & Forgn Pwr 5.000% 03/01/30 54 Americredit Corp 0.750% 09/15/11 70 Americredit Corp 2.125% 09/15/13 64 Americredit Corp 2.125% 09/15/13 65 Americaredit Corp 8.500% 07/01/15 73 Amer Color Graph 10.000% 06/15/10 54 Amer Media Oper 8.875% 01/15/11 75 Amer Meida Oper 10.250% 05/01/09 73 Ames True Temper 10.000% 07/15/12 49 Arris Group Inc 2.000% 11/15/27 74 Ashton Woods USA 9.500% 10/01/15 50 Assured Guaranty 6.400% 12/15/66 69 Atherogenics Inc 1.500% 02/01/12 11 Atherogenics Inc 4.500% 03/01/11 12 Atlantic Coast 6.000% 02/15/34 2 Aventine Renew 10.000% 04/01/17 75 B&G Foods Inc. 12.000% 10/30/16 7 Bally Total Fitn 13.000% 07/15/11 75 Bank New England 8.750% 04/01/99 8 Bank New England 9.500% 02/15/96 14 Bank New England 9.875% 09/15/99 8 Bankunited Cap 3.125% 03/01/34 62 BBN Corp 6.000% 04/01/12 0 Beazer Homes USA 4.625% 06/15/24 71 Beazer Homes USA 6.500% 11/15/13 72 Beazer Homes USA 6.875% 07/15/15 73 Beazer Homes USA 8.125% 06/15/16 75 Berry Plastics 10.250% 03/01/16 74 Bon-Ton Stores 10.250% 03/15/14 69 Borden Inc 7.875% 02/15/23 64 Borden Inc 8.375% 04/15/16 61 Borland Software 2.750% 02/15/12 72 Borland Software 2.750% 02/15/12 72 Bowater Inc 6.500% 06/15/13 70 Bowater Inc 9.375% 12/15/21 73 Broder Bros Co 11.250% 10/15/10 74 Budget Group Inc 9.125% 04/01/06 0 Buffet Inc 12.500% 11/01/14 4 Builders Transport 6.500% 05/01/11 0 Builders Transport 8.000% 08/15/05 0 Burlington North 3.200% 01/01/45 53 Capital 1 IV 6.745 02/17/37 70 Capmark Finl Grp 5.875% 05/10/12 74 Capmark Finl Grp 6.300% 05/10/17 69 CCH I LLC 11.000% 10/01/15 70 CCH I LLC 11.000% 10/01/15 70 Cell Genesys Inc 3.125% 11/01/11 67 Charming Shoppes 1.125% 05/11/14 70 Charter Comm Hld 10.000% 05/15/11 63 Charter Comm Hld 11.125% 01/15/11 67 Charter Comm Hld 11.750% 05/15/11 70 Charter Comm LP 5.875% 11/16/09 67 Charter Comm LP 6.500% 10/01/27 57 CIH 9.920% 04/01/14 51 CIH 10.000% 05/15/14 51 CIH 11.125% 01/15/14 52 CIT Group Inc 6.100% 03/15/67 74 Citizens Tili Co 7.050% 10/01/46 75 Claire's Stores 9.250% 06/01/15 67 Claire's Stores 10.500% 06/01/17 45 Clear Channel 4.900% 05/15/15 72 Clear Channel 5.500% 09/15/14 75 Clear Channel 5.500% 12/15/16 71 Clear Channel 7.250% 10/15/27 72 CMP Susquehanna 9.875% 05/15/14 70 Cogent Commnuications 1.000% 06/15/27 74 Collins & Aikman 10.750% 12/31/11 0 Columbia/HCA 7.500% 11/15/95 75 Comerica Cap TR 6.576% 02/20/37 74 Complete Mgmt 8.000% 08/15/03 0 Complete Mgmt 8.000% 12/15/03 0 Compucredit 3.625% 05/30/25 49 CompuCredit 5.875% 11/30/35 43 Conexant Systems 4.000% 03/01/26 75 Congoleum Corp 8.625% 08/01/08 74 Constar Intl 11.000% 12/01/12 67 Cooper-Standard 8.375% 12/15/03 75 Countrywide Finl 5.250% 05/11/20 73 Countrywide Finl 5.250% 05/27/20 72 Countrywide Finl 5.750% 01/24/31 72 Countrywide Finl 5.800% 01/27/31 72 Countrywide Finl 6.000% 05/16/23 73 Countrywide Finl 6.000% 03/16/26 74 Countrywide Finl 6.000% 07/23/29 73 Countrywide Finl 6.000% 11/22/30 74 Countrywide Finl 6.000% 11/14/35 73 Countrywide Finl 6.000% 12/14/35 72 Countrywide Finl 6.000% 02/08/36 72 Countrywide Home 6.150% 06/25/29 75 Crown Cork & Seal 7.500% 12/15/96 69 Curagen Corp 4.000% 02/15/11 71 Custom Food Prod 8.000% 02/01/07 0 CV Therapheutics 3.250% 08/16/13 73 Decode Genetics 3.500% 04/15/11 68 Decode Genetics 3.500% 04/15/11 64 Delta Air Lines 8.000% 12/01/15 60 Delphi Corp 6.197 11/15/33 29 Delphi Corp 6.500% 08/15/13 40 Delphi Corp 8.250% 10/15/33 28 Dura Operating 8.625% 04/15/12 13 Dura Operating 9.000% 05/01/09 0 Empire Gas Corp 9.000% 12/31/07 0 Encysive Pharma 2.500% 03/15/12 51 EOP Operating LP 7.250% 06/15/28 72 Epix Medical Inc 3.000% 06/15/24 68 Equistar Chemica 7.550% 02/15/26 70 Exodus Comm Inc 4.750% 07/15/08 0 Exodus Comm Inc 11.625% 07/15/10 0 Fedders North Am 9.875% 03/01/14 8 Finova Group 7.500% 11/15/09 15 Finlay Fine Jwly 8.375% 06/01/12 52 First Data Corp 4.700% 08/01/13 66 First Data Corp 4.850% 10/01/14 60 Ford Motor Cred 5.650% 01/21/14 74 Ford Motor Cred 5.750% 01/21/14 74 Ford Motor Cred 5.750% 02/20/14 72 Ford Motor Cred 5.750% 02/20/14 72 Ford Motor Cred 5.900% 02/20/14 73 Ford Motor Cred 6.000% 03/20/14 73 Ford Motor Cred 6.000% 03/20/14 75 Ford Motor Cred 6.000% 03/20/14 74 Ford Motor Cred 6.000% 11/20/14 68 Ford Motor Cred 6.000% 11/20/14 72 Ford Motor Cred 6.000% 11/20/14 71 Ford Motor Cred 6.000% 01/20/15 72 Ford Motor Cred 6.000% 02/20/15 71 Ford Motor Cred 6.050% 02/20/14 74 Ford Motor Cred 6.050% 03/20/14 74 Ford Motor Cred 6.050% 04/21/14 74 Ford Motor Cred 6.050% 12/22/14 72 Ford Motor Cred 6.050% 12/22/14 72 Ford Motor Cred 6.050% 12/22/14 72 Ford Motor Cred 6.050% 02/20/15 72 Ford Motor Cred 6.100% 02/20/15 72 Ford Motor Cred 6.150% 01/20/15 72 Ford Motor Cred 6.200% 03/20/15 71 Ford Motor Cred 6.250% 01/20/15 73 Ford Motor Cred 6.250% 03/20/15 65 Ford Motor Cred 6.300% 05/20/14 75 Ford Motor Cred 6.300% 05/20/14 73 Ford Motor Cred 6.500% 02/20/15 73 Ford Motor Cred 6.500% 03/20/15 74 Ford Motor Cred 6.550% 07/21/14 74 Ford Motor Cred 6.800% 06/20/14 75 Ford Motor Cred 6.800% 03/20/15 75 Ford Motor Cred 7.250% 07/20/17 71 Ford Motor Cred 7.250% 07/20/17 73 Ford Motor Cred 7.350% 09/15/15 75 Ford Motor Cred 7.400% 08/21/17 72 Ford Motor Cred 7.500% 08/20/32 63 Ford Motor Co 6.375% 02/01/29 65 Ford Motor Co 6.500% 08/01/18 73 Ford Motor Co 6.625% 02/15/28 66 Ford Motor Co 6.625% 10/01/28 64 Ford Motor Co 7.125% 11/15/25 66 Ford Motor Co 7.400% 11/01/46 68 Ford Motor Co 7.450% 07/16/31 72 Ford Motor Co 7.500% 08/01/26 69 Ford Motor Co 7.700% 05/15/97 67 Ford Motor Co 7.750% 06/15/43 66 Fountainbleau La 10.250% 06/15/15 72 Franklin Bank 4.000% 05/01/27 69 Freescale Semico 10.125% 12/15/16 72 Frontier Airline 5.000% 12/15/25 69 General Motors 6.750% 05/01/28 67 General Motors 7.375% 05/23/48 70 General Motors 7.400% 09/01/25 73 Georgia Gulf Crp 7.125% 12/15/13 73 Georgia Gulf Crp 10.750% 10/15/16 67 GMAC 5.350% 01/15/14 73 GMAC 5.700% 10/15/13 74 GMAC 5.850% 06/15/13 71 GMAC 5.900% 01/15/19 64 GMAC 5.900% 01/15/19 62 GMAC 5.900% 02/15/19 62 GMAC 5.900% 10/15/19 61 GMAC 6.000% 02/15/19 64 GMAC 6.000% 02/15/19 64 GMAC 6.000% 02/15/19 66 GMAC 6.000% 03/15/19 64 GMAC 6.000% 03/15/19 64 GMAC 6.000% 03/15/19 64 GMAC 6.000% 03/15/19 63 GMAC 6.000% 03/15/19 66 GMAC 6.000% 04/15/19 65 GMAC 6.000% 09/15/19 68 GMAC 6.000% 09/15/19 63 GMAC 6.050% 08/15/19 64 GMAC 6.050% 08/15/19 66 GMAC 6.050% 10/15/19 64 GMAC 6.100% 09/15/19 64 GMAC 6.125% 10/15/19 69 GMAC 6.150% 08/15/19 64 GMAC 6.150% 09/15/19 64 GMAC 6.150% 10/15/19 67 GMAC 6.200% 11/15/13 74 GMAC 6.200% 04/15/19 69 GMAC 6.250% 12/15/18 72 GMAC 6.250% 01/15/19 67 GMAC 6.250% 04/15/19 66 GMAC 6.250% 05/15/19 67 GMAC 6.250% 07/15/19 68 GMAC 6.300% 08/15/19 69 GMAC 6.300% 08/15/19 66 GMAC 6.350% 04/15/19 67 GMAC 6.350% 07/15/19 67 GMAC 6.350% 07/15/19 69 GMAC 6.400% 12/15/18 70 GMAC 6.400% 11/15/19 66 GMAC 6.400% 11/15/19 72 GMAC 6.450% 02/15/13 74 GMAC 6.500% 06/15/18 73 GMAC 6.500% 11/15/18 69 GMAC 6.500% 12/15/18 68 GMAC 6.500% 12/15/18 72 GMAC 6.500% 05/15/19 72 GMAC 6.500% 01/15/20 67 GMAC 6.500% 02/15/20 66 GMAC 6.550% 12/15/19 68 GMAC 6.600% 08/15/16 72 GMAC 6.600% 05/15/18 69 GMAC 6.600% 06/15/19 64 GMAC 6.600% 06/15/19 68 GMAC 6.650% 06/15/18 73 GMAC 6.650% 10/15/18 66 GMAC 6.650% 10/15/18 73 GMAC 6.650% 02/15/20 71 GMAC 6.700% 06/15/14 73 GMAC 6.700% 08/15/16 68 GMAC 6.700% 06/15/18 67 GMAC 6.700% 06/15/18 71 GMAC 6.700% 11/15/18 69 GMAC 6.700% 06/15/19 68 GMAC 6.700% 12/15/19 68 GMAC 6.750% 08/15/16 73 GMAC 6.750% 09/15/16 72 GMAC 6.750% 06/15/17 70 GMAC 6.750% 03/15/18 70 GMAC 6.750% 07/15/18 70 GMAC 6.750% 09/15/18 69 GMAC 6.750% 10/15/18 73 GMAC 6.750% 11/15/18 67 GMAC 6.750% 05/15/19 68 GMAC 6.750% 05/15/19 70 GMAC 6.750% 06/15/19 74 GMAC 6.750% 06/15/19 72 GMAC 6.750% 03/15/20 75 GMAC 6.800% 09/15/18 74 GMAC 6.800% 10/15/18 70 GMAC 6.850% 05/15/18 69 GMAC 6.875% 08/15/16 73 GMAC 6.875% 07/15/18 70 GMAC 6.900% 06/15/17 74 GMAC 6.900% 07/15/18 69 GMAC 6.900% 08/15/18 73 GMAC 7.000% 07/15/17 75 GMAC 7.000% 02/15/18 71 GMAC 7.000% 03/15/18 71 GMAC 7.000% 05/15/18 73 GMAC 7.000% 08/15/18 68 GMAC 7.000% 09/15/18 72 GMAC 7.000% 02/15/21 74 GMAC 7.000% 09/15/21 73 GMAC 7.000% 09/15/21 68 GMAC 7.000% 06/15/22 67 GMAC 7.000% 11/15/23 68 GMAC 7.000% 11/15/24 66 GMAC 7.000% 11/15/24 66 GMAC 7.000% 11/15/24 66 GMAC 7.050% 03/15/18 71 GMAC 7.050% 04/15/18 74 GMAC 7.125% 10/15/17 73 GMAC 7.150% 09/15/18 72 GMAC 7.150% 01/15/25 74 GMAC 7.150% 03/15/25 67 GMAC 7.200% 10/15/17 74 GMAC 7.200% 10/15/17 73 GMAC 7.250% 09/15/17 72 GMAC 7.250% 09/15/17 71 GMAC 7.250% 01/15/18 70 GMAC 7.250% 04/15/18 73 GMAC 7.250% 04/15/18 71 GMAC 7.250% 08/15/18 73 GMAC 7.250% 08/15/18 73 GMAC 7.250% 09/15/18 74 GMAC 7.250% 01/15/25 69 GMAC 7.250% 02/15/25 68 GMAC 7.250% 03/15/25 69 GMAC 7.300% 12/15/17 71 GMAC 7.300% 01/15/18 74 GMAC 7.300% 01/15/18 74 GMAC 7.350% 04/15/18 73 GMAC 7.375% 11/15/16 75 GMAC 7.375% 04/15/18 74 GMAC 7.400% 12/15/17 75 GMAC 7.500% 11/15/17 71 GMAC 7.500% 03/15/25 70 Golden Books Pub 10.750% 12/31/04 0 Gulf Mobile Ohio 5.000% 12/01/56 73 Gulf States STL 13.500% 04/15/03 0 Harland Clarke 9.500% 05/15/15 73 Harrahs Oper Co 5.375% 12/15/13 68 Harrahs Oper Co 5.625% 06/01/15 63 Harrahs Oper Co 5.750% 10/01/17 60 Harrahs Oper Co 6.500% 06/01/16 64 Hawaiian TelCom 12.500% 05/01/15 75 Headwaters Inc 2.500% 02/01/14 68 Hechinger Co 9.450 11/15/12 2 Hercules Inc 6.500% 06/30/29 69 Herbst Gaming 7.000% 11/15/14 39 Herbst Gaming 8.125% 06/01/12 40 Hills Stores Co 12.500% 07/01/03 0 Hilton Hotels 7.500% 12/15/17 71 Hines Nurseries 10.250% 10/01/11 59 HNG Internorth 9.625% 03/15/06 19 Human Genome 2.250% 05/15/12 72 Huntington Natl 5.375% 02/28/19 75 IDEARC Inc 8.000% 11/15/16 68 Ikon Office 6.750% 12/01/25 71 Ion Media 11.000% 07/31/13 60 Iridium LLC/CAP 10.875% 07/15/05 1 Iridium LLC/CAP 11.250% 07/15/05 1 Iridium LLC/CAP 13.000% 07/15/05 1 Iridium LLC/CAP 14.000% 07/15/05 1 Isle of Capri 7.000% 03/01/14 73 JB Poindexter 8.750% 03/15/14 73 Jones Apparel 6.125% 11/15/34 72 JP Morgan Chase 12.000% 07/31/08 62 K Hovnanian Entr 6.000% 01/15/10 61 K Hovnanian Entr 6.250% 01/15/15 70 K Hovnanian Entr 6.250% 01/15/16 70 K Hovnanian Entr 6.375% 12/15/14 71 K Hovnanian Entr 6.500% 01/15/14 70 K Hovnanian Entr 7.500% 05/15/16 71 K Hovnanian Entr 7.750% 05/15/13 55 K Hovnanian Entr 8.875% 04/01/12 55 Kaiser Aluminum 9.875% 02/15/02 0 Kaiser Aluminum 12.750% 02/01/03 3 Keystone Auto Op 9.750% 11/01/13 65 Kimball Hill Inc 10.500% 12/15/12 20 Kmart 95-K4 PT 9.350% 01/02/20 0 Kmart 95-K2 PT 9.780% 01/05/20 0 Kmart Corp 8.540% 01/02/15 0 Kmart Corp 9.350% 01/02/20 0 Kmart Corp 9.780% 01/05/20 0 Kmart Funding 8.800% 07/01/10 10 Knight Ridder 4.625% 11/01/14 72 Knight Ridder 5.750% 09/01/17 66 Knight Ridder 6.875% 03/15/29 66 Knight Ridder 7.150% 11/01/27 75 Kulicke & Soffa 0.875% 06/01/12 73 Kulicke & Soffa 0.875% 06/01/12 70 Lehman Bros Holding 5.000% 05/28/23 75 Lehman Bros Holding 9.500% 05/01/08 75 Leiner Health 11.000% 06/01/12 65 Level 3 Comm Inc 3.500% 06/15/12 74 Liberty Media 3.250% 03/15/31 73 Liberty Media 3.500% 01/15/31 66 Liberty Media 3.750% 02/15/30 56 Liberty Media 4.000% 11/15/29 58 Lifecare Holding 9.250% 08/15/13 59 Lifetime Brands 4.750% 07/15/11 74 LTV Corp 8.200% 09/15/07 0 Lucent Tech 6.500% 01/15/28 74 Magna Entertainm 7.250% 12/15/09 70 Magna Entertainm 8.550% 06/15/10 72 Majestic Star 9.750% 01/15/11 60 MBIA Inc 6.400% 08/15/22 72 MBIA Inc 6.625% 10/01/28 72 McSaver Financl 7.400% 02/15/02 0 McSaver Financl 7.875% 08/01/03 1 MediaCom Braodband 8.500% 10/15/15 75 MediaNews Group 6.375% 04/01/14 55 MediaNews Group 6.875% 10/01/13 55 Merisant Co 9.500% 07/15/13 74 Meritage Corp 7.000% 05/01/14 73 Meritage Homes 6.250% 03/15/15 71 Merix Corp 4.000% 05/15/13 63 Metaldyne Corp 10.000% 11/01/13 70 Metaldyne Corp 11.000% 06/15/12 48 MHS Holdings Co 16.875% 09/22/04 0 Millenium Amer 7.625% 11/15/26 71 Momentive Perfor 11.500% 12/01/16 75 Motorola Inc 5.220% 10/01/97 62 Movie Gallery 11.000% 05/01/12 15 Muzak LLC 9.875% 03/15/09 70 Natl Steel Corp 8.375% 08/01/06 0 Natl Steel Corp 9.875% 03/01/09 0 Neenah Corp 9.500% 01/01/17 73 Neff Corp 10.000% 06/01/15 48 New Orl Grt N RR 5.000% 07/01/32 60 New Plan Excel 5.250% 09/15/15 75 New Plan Realty 6.900% 02/15/28 49 New Plan Excel 7.500% 07/30/29 56 New Plan Realty 7.650% 11/02/26 54 New Plan Realty 7.680% 11/02/26 53 New Plan Realty 7.970% 08/14/26 54 Northern Pacific RY 3.000% 01/01/47 49 Northern Pacific RY 3.000% 01/01/47 49 Northwest Steel & Wire 9.500% 06/15/01 0 NTK Holdings Inc 10.750% 03/01/14 57 Nutritional Src 10.125% 08/01/09 2 Nuveen Invest 5.500% 09/15/15 70 Oakwood Homes 8.125% 03/01/19 1 Omnicare Inc 3.250% 12/15/35 70 Oscient Pharma 3.500% 04/15/11 32 Outback Steakhse 10.000% 06/15/15 62 Outboard Marine 7.000% 07/01/02 0 Outboard Marine 9.125% 04/15/17 7 Quality Distribu 9.000% 11/15/10 61 Pac-West Telecom 13.500% 02/01/09 1 Pac-West Telecom 13.500% 02/01/09 1 Palm Harbor 3.250% 05/15/24 72 Pegasus Satellite 12.375% 08/01/08 0 PGS Solutions 9.625% 02/15/15 75 Phar-Mor Inc 11.720% 12/31/49 0 Piedmont Aviat 10.250% 01/15/49 0 Pierre Foods Inc 9.875% 07/15/12 70 Pixelworks Inc 1.750% 05/15/24 71 Ply Gem Indust 9.000% 02/15/12 75 Pope & Talbot 8.375% 06/01/13 12 Pope & Talbot 8.375% 06/01/13 15 Portola Packagin 8.250% 02/01/12 65 Powerwave Tech 1.875% 11/15/24 69 Powerwave Tech 3.875% 10/01/27 71 Primus Telecom 3.750% 09/15/10 56 Primus Telecom 5.000% 06/30/09 69 Primus Telecom 8.000% 01/15/14 50 Propex Fabrics 10.000% 12/01/12 9 PSInet Inc 10.000% 02/15/05 0 PSInet Inc 10.500% 12/01/06 0 Radio One Inc 6.375% 02/15/13 70 Radnor Holdings 11.000% 03/15/10 0 Railworks Corp 11.500% 04/15/09 1 Rayovac Corp 8.500% 10/01/13 65 RDM Sports Group 11.750% 07/15/02 3 Realogy Corp 10.500% 04/15/14 72 Realogy Corp 12.375% 04/15/15 60 Realty Income 5.875% 03/15/35 71 Restaurant Co 10.000% 10/01/13 64 Residential Cap 6.000% 02/22/11 62 Residentail Cap 6.375% 06/30/10 64 Residential Cap 6.500% 06/01/12 61 Residential Cap 6.500% 04/17/13 61 Residential Cap 6.875% 06/30/15 61 RF Micro Devices 0.750% 04/15/12 73 RF Micro Devices 0.750% 04/15/12 73 RF Micro Devices 1.000% 04/15/14 69 RF Micro Devices 1.000% 04/15/09 68 RH Donnelley 6.875% 01/15/13 72 RH Donnelley 6.875% 01/15/13 71 RH Donnelley 6.875% 01/15/13 71 RH Donnelley 8.875% 01/15/16 70 RH Donnelley 8.875% 10/15/17 69 Rite Aid Corp. 6.875% 08/15/13 66 Rite Aid Corp. 7.700% 02/15/27 57 RJ Tower Corp. 12.000% 06/01/13 2 S3 Inc 5.750% 10/01/03 0 Sears Roebuck AC 6.750% 01/15/28 74 Sears Roebuck AC 7.000% 06/01/32 73 ServiceMaster Co 7.100% 03/01/18 67 ServiceMaster Co 7.250% 03/01/38 71 ServiceMaster Co 7.450% 08/15/27 54 Six Flags Inc 4.500% 05/15/15 64 Six Flags Inc 8.875% 02/01/10 74 Six Flags Inc 9.625% 06/01/14 66 Six Flags Inc 9.750% 04/15/13 67 SLM Corp 4.700% 12/15/28 69 SLM Corp 4.800% 12/15/28 60 SLM Corp 5.000% 06/15/18 74 SLM Corp 5.000% 06/15/19 69 SLM Corp 5.000% 09/15/20 67 SLM Corp 5.000% 12/15/28 71 SLM Corp 5.050% 03/15/23 64 SLM Corp 5.190% 04/24/19 73 SLM Corp 5.200% 03/15/28 68 SLM Corp 5.250% 03/15/19 72 SLM Corp 5.250% 03/15/28 75 SLM Corp 5.250% 06/15/28 69 SLM Corp 5.250% 12/15/28 67 SLM Corp 5.350% 06/15/25 68 SLM Corp 5.350% 06/15/25 69 SLM Corp 5.350% 06/15/28 63 SLM Corp 5.400% 03/15/30 65 SLM Corp 5.400% 06/15/30 60 SLM Corp 5.450% 12/15/20 71 SLM Corp 5.450% 03/15/23 71 SLM Corp 5.450% 03/15/28 71 SLM Corp 5.450% 06/15/28 71 SLM Corp 5.450% 06/15/28 66 SLM Corp 5.500% 03/15/19 71 SLM Corp 5.500% 06/15/28 69 SLM Corp 5.500% 06/15/29 68 SLM Corp 5.500% 06/15/29 64 SLM Corp 5.500% 06/15/29 72 SLM Corp 5.500% 03/15/30 64 SLM Corp 5.500% 03/15/30 63 SLM Corp 5.500% 06/15/30 67 SLM Corp 5.500% 06/15/30 68 SLM Corp 5.500% 06/15/30 66 SLM Corp 5.500% 12/15/30 60 SLM Corp 5.500% 12/15/30 66 SLM Corp 5.500% 03/15/18 73 SLM Corp 5.550% 06/15/25 67 SLM Corp 5.550% 03/15/28 72 SLM Corp 5.550% 06/15/28 68 SLM Corp 5.550% 03/15/29 70 SLM Corp 5.600% 03/15/22 72 SLM Corp 5.600% 03/15/24 75 SLM Corp 5.600% 12/15/28 71 SLM Corp 5.600% 03/15/29 69 SLM Corp 5.600% 03/15/29 70 SLM Corp 5.600% 03/15/29 69 SLM Corp 5.600% 06/15/29 67 SLM Corp 5.600% 12/15/29 66 SLM Corp 5.600% 12/15/29 66 SLM Corp 5.625% 01/25/25 70 SLM Corp 5.650% 06/15/22 72 SLM Corp 5.650% 06/15/22 72 SLM Corp 5.650% 03/15/29 64 SLM Corp 5.650% 03/15/29 70 SLM Corp 5.650% 12/15/29 65 SLM Corp 5.650% 12/15/29 59 SLM Corp 5.650% 12/15/29 63 SLM Corp 5.650% 03/15/30 67 SLM Corp 5.650% 06/15/30 61 SLM Corp 5.650% 09/15/30 67 SLM Corp 5.650% 03/15/32 70 SLM Corp 5.700% 03/15/29 67 SLM Corp 5.700% 03/15/29 68 SLM Corp 5.700% 03/15/29 67 SLM Corp 5.700% 03/15/29 68 SLM Corp 5.700% 03/15/29 72 SLM Corp 5.700% 03/15/30 65 SLM Corp 5.700% 03/15/32 71 SLM Corp 5.750% 03/15/29 71 SLM Corp 5.750% 03/15/29 68 SLM Corp 5.750% 03/15/29 70 SLM Corp 5.750% 06/15/29 67 SLM Corp 5.750% 06/15/29 64 SLM Corp 5.750% 09/15/29 66 SLM Corp 5.750% 09/15/29 64 SLM Corp 5.750% 12/15/29 68 SLM Corp 5.750% 12/15/29 67 SLM Corp 5.750% 12/15/29 64 SLM Corp 5.750% 12/15/29 68 SLM Corp 5.750% 03/15/30 65 SLM Corp 5.750% 03/15/30 68 SLM Corp 5.750% 06/15/32 71 SLM Corp 5.750% 06/15/32 71 SLM Corp 5.800% 12/15/29 65 SLM Corp 5.800% 03/15/32 72 SLM Corp 5.800% 03/15/32 72 SLM Corp 5.800% 03/15/32 72 SLM Corp 5.850% 09/15/29 66 SLM Corp 5.850% 12/15/31 66 SLM Corp 5.850% 03/15/32 72 SLM Corp 5.850% 03/15/32 72 SLM Corp 5.850% 03/15/32 72 SLM Corp 5.850% 06/15/32 72 SLM Corp 5.850% 06/15/32 72 SLM Corp 6.000% 06/15/21 75 SLM Corp 6.000% 06/15/21 73 SLM Corp 6.000% 06/15/21 73 SLM Corp 6.000% 06/15/26 72 SLM Corp 6.000% 06/15/26 69 SLM Corp 6.000% 12/15/26 75 SLM Corp 6.000% 12/15/26 72 SLM Corp 6.000% 12/15/26 74 SLM Corp 6.000% 03/15/27 73 SLM Corp 6.000% 12/15/28 72 SLM Corp 6.000% 12/15/28 74 SLM Corp 6.000% 03/15/29 69 SLM Corp 6.000% 06/15/29 67 SLM Corp 6.000% 06/15/29 68 SLM Corp 6.000% 06/15/29 74 SLM Corp 6.000% 09/15/29 66 SLM Corp 6.000% 09/15/29 65 SLM Corp 6.000% 09/15/29 70 SLM Corp 6.000% 09/15/29 73 SLM Corp 6.000% 06/15/31 68 SLM Corp 6.000% 06/15/31 66 SLM Corp 6.000% 12/15/31 66 SLM Corp 6.000% 12/15/31 66 SLM Corp 6.000% 12/15/31 67 SLM Corp 6.000% 12/15/31 67 SLM Corp 6.000% 03/15/37 71 SLM Corp 6.000% 03/15/37 71 SLM Corp 6.000% 03/15/37 71 SLM Corp 6.050% 12/15/26 70 SLM Corp 6.050% 12/15/31 67 SLM Corp 6.100% 09/15/21 75 SLM Corp 6.100% 12/15/28 68 SLM Corp 6.100% 12/15/31 64 SLM Corp 6.150% 09/15/29 66 SLM Corp 6.150% 09/15/29 74 SLM Corp 6.200% 09/15/26 75 SLM Corp 6.200% 12/15/31 68 SLM Corp 6.250% 06/15/29 70 SLM Corp 6.250% 06/15/29 70 SLM Corp 6.250% 09/15/31 74 SLM Corp 6.250% 09/15/29 68 SLM Corp 6.250% 09/15/29 70 SLM Corp 6.300% 09/15/31 71 SLM Corp 6.300% 09/15/31 67 SLM Corp 6.350% 09/15/31 72 SLM Corp 6.350% 09/15/31 72 SLM Corp 6.400% 09/15/31 69 SLM Corp 6.500% 09/15/31 71 Spacehab Inc 5.500% 10/15/10 60 Spansion LLC 2.250% 06/15/16 48 Spansion LLC 11.250% 01/15/16 71 Spectrum Brands 7.375% 02/01/15 70 Standard Pac Corp 6.000% 10/01/12 63 Standard Pac corp 6.250% 04/01/14 71 Standard Pac Corp 6.875% 05/15/11 73 Standard Pacific 7.000% 08/15/15 71 Standard Pac corp 7.750% 03/15/13 72 Standard Pacific 9.250% 04/15/12 58 Stanley-Martin 9.750% 08/15/15 50 Station Casinos 6.500% 02/01/14 69 Station Casinos 6.625% 03/15/18 64 Station Casinos 6.875% 03/01/16 67 Swift Trans Co 12.500% 05/15/17 43 Tech Olympic 8.250% 04/01/11 55 Tekni-Plex Inc 12.750% 06/15/10 66 Teligent Inc 11.500% 12/01/07 0 Tenet Healthcare 6.875% 11/15/31 72 Times Mirror Co 6.610% 09/15/27 53 Times Mirror Co 7.250% 03/01/13 61 Times Mirror Co 7.250% 11/15/96 52 Times Mirror-New 7.500% 07/01/23 49 Tom's Foods Inc 10.500% 11/01/04 1 Tops Appliance 6.500% 11/30/03 0 Tousa Inc 7.500% 03/15/11 8 Tousa Inc 7.500% 01/15/15 7 Tousa Inc 9.000% 07/01/10 54 Tousa Inc 9.000% 07/01/10 58 Tousa Inc 10.375% 07/01/12 8 Toys R Us 7.375% 10/15/18 69 Toys R Us 7.875% 04/15/13 74 TransTexas Gas 15.000% 03/15/05 0 Trex Co Inc 6.000% 07/01/12 70 Triad Acquis 11.125% 05/01/13 66 Tribune Co 4.875% 08/15/10 59 Tribune Co 5.250% 08/15/15 51 Trism Inc 12.000% 02/15/05 0 True Temper 8.375% 09/15/11 50 Trump Entertnmnt 8.500% 06/01/15 73 TXU Corp 6.500% 11/15/24 72 TXU Corp 6.550% 11/15/34 71 United Air Lines 9.300% 03/22/08 50 United Air Lines 10.850% 02/19/15 31 United Homes Inc 11.000% 03/15/05 0 Universal Standard 8.250% 02/01/06 0 US Air Inc. 10.250% 01/15/49 0 US Air Inc. 10.550% 01/15/49 0 US Air Inc. 10.550% 01/15/49 0 US Air Inc. 10.700% 01/01/49 0 US Air Inc. 10.700% 01/15/49 0 US Air Inc. 10.750% 01/15/49 0 US Air Inc. 10.800% 01/01/49 0 US Air Inc. 10.800% 01/01/49 0 US Air Inc. 10.800% 01/01/49 0 US Air Inc. 10.900% 01/01/49 0 US Air Inc. 10.900% 01/01/49 0 Vertis Inc 10.875% 06/15/09 47 Vesta Insur Grp 8.750% 07/15/25 2 Vicorp Restaurant 10.500% 04/15/11 36 Vion Pharm Inc 7.750% 02/15/12 67 Visteon Corp 7.000% 03/10/14 67 Wachovia Corp 9.250% 04/10/08 41 Wachovia Corp 12.500% 03/05/08 43 Washington Mutual Pfd 6.534% 03/29/49 68 Washington Mutual Pfd 6.665% 12/31/49 68 WCI Communities 6.625% 03/15/15 53 WCI Communities 7.875% 10/01/13 54 WCI Communities 9.125% 05/01/12 58 Werner Holdings 10.000% 11/15/07 0 William Lyon 7.500% 02/15/14 55 William Lyon 7.625% 12/15/12 56 William Lyon 10.750% 04/01/13 58 Wimar Op LLC/Fin 9.625% 12/15/14 60 Winstar Comm Inc 10.000% 03/15/08 0 Winstar Comm Inc 12.500% 04/15/08 0 Winstar Comm Inc 12.750% 04/15/10 0 Winstar Comm 14.000% 10/15/05 0 Witco Corp 6.875% 02/01/26 75 Wornick Co 10.875% 07/15/11 64 Young Broadcasting 8.750% 01/15/14 67 Young Broadcasting 10.000% 03/01/11 71 Ziff Davis Media 12.000% 08/12/09 22 ********* 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. Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, Philline P. Reluya, Joseph Medel C. Martirez, Ma. Cristina I. Canson, Christopher G. Patalinghug, 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 ***