/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/080324.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 24, 2008, Vol. 12, No. 70 Headlines ACCO BRANDS: S&P Changes Outlook to Stable; Confirms 'BB-' Rating ALASKA AIRLINES: Staff Not Protected by AMFA, Teamsters Says ALOHA AIRLINES: Files Voluntary Chapter 22 Petition in Hawaii ALOHA AIRLINES: Case Summary & 20 Largest Unsecured Creditors AMERICAN COLOR: Noteholders Extend 2008 Notes Due Date to June 15 AMERIQUEST MORTGAGE: Fitch Takes Various Rating Actions Certs. AMERIQUEST MORTGAGE: Eight Certs. Obtain Fitch's Low-B Ratings AMES TRUE: S&P Changes Outlook to Stable; Confirms 'CCC+' Rating APOLLO DRILLING: Posts $335,666 Net Loss in 2007 Second Quarter ASSOCIATED ESTATES: Completes Sale of Toledo, Ohio Portfolio BCE INC: Court to Consider Bell Noteholders' Appeal on April 28 BEACH HOUSE: Can Employ Furr and Cohen as Bankruptcy Counsel BEACH HOUSE: U.S. Trustee Sets Sec. 341 Meeting on March 27 BEACH HOUSE: Files Schedules of Assets and Liabilities BEACH HOUSE: Creditors Have Until June 25 to File Claims BEAR STEARNS: Largest Shareholder Opposes JP Morgan Purchase BEAR STEARNS: Citic Securities Withdraws $120 Per Share Offer BLUE WATER: Wants to Hire Huron as Financial Consultants BLUE WATER: Seeks to Tap Miller Buckfire as Investment Bankers BLUE WATER: Creditors Panel Can Hire Schafer as Counsel BLUE WATER: Creditors Panel Wants Stout Risius as Advisor BRAINTECH INC: Revises Fin'l Results to Show Stock Options Charges BRINX RESOURCES: Earns $223,256 in First Quarter Ended Jan. 31 CA INC: Ample Cash Flow Prompts S&P's Positive CreditWatch Listing CD COMMERCIAL: Fitch Maintains Low-B Ratings on Three Certificates CENTENE CORP: S&P Designates 'BB' Rating on Negative CreditWatch CHEMTURA CORP: Posts $3.0 Million Net Loss in Year Ended Dec. 31 CHRYSLER LLC: Agrees to Extend Supply Agreement to April 2 CIRRUS LOGIC: To Close Caretta Operations in Shanghai, China CLEARPOINT BUSINESS: Two Units Ink Sale and Licensing Agreements CLEARPOINT BUSINESS: Christopher Ferguson Resigns as President COMM 2006-FL12: Five Cert. Classes Get S&P's Rating Cuts to Low-Bs COMMERCIAL VEHICLE: Moody's Downgrades Corp. Family Rating to 'B1' CONSUMERS ENERGY: Issues $250 M. 5.65% 1st Mortgage Bonds due 2018 CONTINENTAL AIRLINES: Teamsters Criticizes AMFA Over Mechanic Jobs COOPER COMPANIES: Moody's Holds Ba3 Ratings With Negative Outlook CREDIT SUISSE: Six 2008-C1 Certs. Get S&P's Low-B Initial Ratings DEERFIELD CAPITAL: Completes Sale of RMBS and Rate Swaps Reduction DEERFIELD CAPITAL: Extends Waivers with Noteholders to March 2009 DEERFIELD CAPITAL: Gregory Sachs Resigns from Board of Directors DEUTSCHE BANK: Moody's Cuts 164 Tranches' Ratings on Delinquencies EDS CORP: Augments EDS Global Network with Nexagent Assets Buyout EFOODSAFETY.COM: Posts $942,334 Net Loss in 3rd Qtr. Ended Jan. 31 EL PASO CORP: Earns $1.11 Billion in 12 Months Ended December 31 ENTERPRISE GP: Had $947MM Working Capital Deficit at Dec. 31, 2007 ENTERPRISE GP: Moody's Affirms Ba1 Rating, Revises Outlook to Neg. EQUA-CHLOR: Seeks Permission to Hire Lane Powell as Counsel EQUA-CHLOR: U.S. Trustee Appoints 5-Member Creditors' Panel EQUA-CHLOR: Panel Can Hire Bush Strout as Bankruptcy Counsel FERRO CORP: Had $94 Million Net Loss for Year Ended Dec. 31, 2007 FINLAY ENTERPRISES: Extends License Contract with Macy's Central FORD MOTOR: Tata Inks $3 Bil. Loan to Buy Jaguar & Land Rover FRONTIER OIL: Earns $43.4 Million in 2007 Fourth Quarter GE COMMERCIAL: Six Certificates Acquire Fitch's Low-B Ratings GAP INC: Earns $265 Million in Fourth Quarter Ended February 2 GRAN TIERRA: Net Loss Rises to $8 Mil. in Year ended December 31 GRAPHIC PACKAGING: Moody's Keeps Low-B Ratings on Altivity Merger GREAT PLAINS: Earns $157.6 Million in Year Ended December 31 GS MORTGAGE: S&P Cuts Rating on Class J Certs. to 'BB' From 'BBB-' GSV INC: Brooks Extends Due Date of $180,000 Note to Sept. 1 HAMILTON GARDENS: Eroding Credit Quality Spurs Moody's Rating Cuts HANCOCK FABRICS: Jeff Nerland Quits as Chief Financial Officer HANCOCK FABRICS: Names Robert Driskell as Chief Financial Officer HANCOCK FABRICS: Seeks Court Approval of Changes to CRG Employment HEALTH MANAGEMENT: Moody's Pares Corporate Family Rating to 'B1' IMPAC MORTGAGE: EVPs Andrew McCormick and Richard Johnson Resign INTERNATIONAL RECTIFIER: Appoints Tom Lacey to Board of Directors INTEREP NATIONAL: Non-Payment of $100MM Bonds May Cue Bankruptcy JAMES RIVER: To Market 3 Million Shares in Public Offering JP MORGAN: Stable Performance Cues Fitch To Hold Six Low-B Ratings JP MORGAN: Fitch Maintains Low-B Ratings on Five 2002-CIBC4 Certs. KIMBALL HILL: Extends Waiver Pact with Lenders through April 11 LAS VEGAS SANDS: Earns $116.6 Million in Year Ended Dec. 31, 2007 LEHMAN BROS: S&P Slashes Ratings on Class ASH-1 and ASH-2 Certs. LODGENET INTERACTIVE: S&P Gives Negative Outlook; Holds B+ Rating MACY'S INC: Extends License Contract with Finlay Enterprises METRO ONE: Appoints James Hensel as President and Board Director MICHAELS STORES: Feb. 2 Balance Sheet Upside Down by $2.892 Bil. ML-CFC COMMERCIAL: Fitch Confirms Low-B Ratings on Four Certs. MORGAN STANLEY: Fitch Gives Low-B Ratings on Five Cert. Classes MORGAN STANLEY: Fitch Rates $6.0 Mil. Class L Certs. at 'BB-' MOST HOME: January 31 Balance Sheet Upside-Down by $1,505,823 MOVIE GALLERY: Seeks Permission to Reject Dotcast License Pact NATIONAL LAMPOON: Jan. 31 Balance Sheet Upside-Down by $4,644,014 NEW CENTURY: Court Approves Amended Disclosure Statement NEW CENTURY: Various Parties Get Court OK to Initiate Foreclosure NOMURA TRUSTS: Higher Delinquencies Cues Moody's 100 Rating Cuts NORTHWEST AIRLINES: Staff Not Protected by AMFA, Teamsters Says OCCULOGIX INC: Ernst & Young Issues Going Concern Opinion ON SEMICONDUCTOR: Inks $32.8 Million Sale/Leaseback of Equipment ON SEMICONDUCTOR: Completes Stock-for-Stock Merger with AMIS ON THE GO: Posts $1,191,467 Net Loss in 2nd Quarter Ended Jan. 31 PEOPLES CHOICE: Judge Kwan Moots Exclusive Plan Filing Period PEOPLES CHOICE: Set Sale Procedures For 12 Properties PLASTECH ENGINEERED: Extends Supply Pact with Chrysler to April 2 POWERMATE HOLDING: Bankruptcy Causes LayOff of 100 Kearney Staff PRC LLC: Court Okays Evercore Group as Investment Bankers PRC LLC: Can Employ Philip Goodeve as Chief Financial Officer QUAIL LAKE: Case Summary & 14 Largest Unsecured Creditors QUEBECOR WORLD: Wants to Assume BofA's Purchasing Card Pact QUEBECOR WORLD: Wants to Pay DB Plans Funding Contributions QUEBECOR WORLD: Seeks Nod to Pay Prepetition Wages to 376 Managers QUICK SERVICE: Wants to Hire Fowler White as Bankruptcy Counsel RH DONNELLEY: Earns $47 Million in Year Ended December 31 ROO GROUP: Appoints Gavin Campion as President ROO GROUP: Unveils Plan to Streamline Structure; Moves HQ to Dubai ROTECH HEALTHCARE: Receives Nasdaq's Equity Non-Compliance Notice RURAL CELLULAR: Dec. 31 Balance Sheet Upside-Down by $791.2 Mil. SCO GROUP: Posts $1.5 Million Net Loss in 1st Qtr. Ended Jan. 31 SEA CONTAINERS: Wants to Ink Two Charter Termination Agreements SEALY CORP: David McIlquham Resigns as President and Chairman SEALY CORP: Unit's Weak Performance Prompts Moody's Neg. Outlook SOLIDUS NETWORKS: Shuts Down Biometric Transactions for Clients SPIRIT AEROSYSTEMS: S&P Alters Outlook to Stable; Holds BB Rating TABS 2006-5: Moody's Junks Rating on $950 Million Notes From 'C' TECUMSEH PRODUCTS: Shareholder Asks Board to Evaluate Sale of Biz TEMPUR-PEDIC INT'L: S&P Changes Outlook to Stable; Holds BB Rating TRICOM SA: Bancredit Balks at Schedules Filing Extension TRICOM SA: Wants to Hire FTI as Restructuring Consultant TRICOM SA: Wants to Hire Kurtzman as Notice & Claims Agent TRIGEM COMPUTER: Seeks Court Approval of Toshiba Settlement UAL CORPORATION: Drops Plea to Hold American Moulding in Contempt UAL CORPORATION: Staff Not Protected by AMFA, Teamsters Says UAL CORPORATION: De-registers Unsold 4.5% Convertible Notes UNITED RENTALS: Pays $27 Mil. Settlement for Class Action Lawsuits USEC INC: Earns $25 Million in Fourth Quarter ended December 31 USPROTECT CORP: Judge Catliota Appoints Chapter 7 Trustee VALEANT PHARMA: Posts $6.2 Million Net Loss in Year Ended Dec. 31 VICORP RESTAURANTS: S&P Gives Negative Outlook; Holds Junk Rating VICTOR PLASTICS: $17.4MM Sale to River Bend to Close on April 21 WELLMAN INC: Wants to Sell Former Bottle Yard for $400,000 WESTWAYS FUNDING: Poor Asset Market Value Cues Moody's Rating Cuts WILLIAMS INDUSTRIES: Posts $572,000 Net Loss in Qtr. Ended Jan. 31 WOLVERINE TUBE: Completes $25MM Cash Sale of Small Tube Business XERIUM TECH: Projected Bankruptcy Filing Spurs S&P's Junk Rating * Fitch Says U.S. Home Improvement Spending Will Continue To Fall * Moody's Adds Loan CDS Ratings to Market-Implied Ratings Platform * Moody's Valuation Expands Coverage to More Illiquid Securities * Moody's Says Commercial Real Estate Prices Declines in January * S&P Downgrades 32 Tranches' Ratings From 6 Cash Flows and CDOs * S&P Downgrades Ratings on Six Classes Issued by Five CLTV Deals * S&P Downgrades Ratings on 44 Classes From 11 RMBS Transactions * Consumer Staples Should Withstand Economic Slowdown, S&P Says * S&P Reports Delinquencies Continue to Rise for Subprime RMBS * S&P Says Telecom Sector is Positioned to Handle Economic Setback * CRG Partners Transfers Los Angeles Office to a New Location * Donald Stern Joins Cooley Godward Kronish as Litigation Partner * FTI Consulting Expands Service Scope with European Firms Buyout * Sullivan & Worcester Forms Credit Crisis Task Force * BOND PRICING: For the Week of Mar. 17 - Mar. 20, 2008 ********* ACCO BRANDS: S&P Changes Outlook to Stable; Confirms 'BB-' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on office products manufacturer ACCO Brands Corp. to stable from negative. At the same time, Standard & Poor's affirmed all of its ratings on the company, including its 'BB-' corporate credit rating. "The outlook revision reflects ACCO's improved operating margins and reduced leverage to levels closer to our expectations following the company's 2005 merger with General Binding Corp.," said Standard & Poor's credit analyst Bea Chiem. Although revenues have slightly declined, from the exit from nonstrategic businesses, volume losses in certain product categories due to price increases and increased competition, as well as lower sales demand in the U.S., the company has been able to meet its planned cost savings. EBITDA grew by about 9% and margins improved to 11.6% in fiscal 2007. At the same time, Standard & Poor's raised the rating on the company's $350 million subordinated notes to 'B+', one notch below the company's corporate credit rating, from 'B', in conjunction with Standard & Poor's assignment of recovery ratings to unsecured issues. These notes were assigned a recovery rating of '5', indicating expectations of modest (10%-30%) recovery in the event of a payment default. The ratings on Lincolnshire, Illinois-based ACCO reflect the company's leading market position, portfolio of well-known brands, and wide geographic distribution. These factors are somewhat mitigated by the highly competitive operating environment in which the company operates, customer concentration, and the company's leveraged financial profile. ALASKA AIRLINES: Staff Not Protected by AMFA, Teamsters Says ------------------------------------------------------------ The Teamsters Union said that the Aircraft Mechanics Fraternal Association (AMFA) failed to protect mechanics' jobs at United Airlines Inc., Northwest Airlines Corp. and Alaska Airlines Inc. AMFA also misrepresented conditions at Teamster airlines. Continental Airlines Inc. outsourced jobs before the Teamsters were elected to represent mechanics at that airline. The number of mechanics and related at Continental increased to 3,605 last year from 3,050 in 1998, when the Teamsters became the mechanics' representative. Continental's furlough list has been exhausted and new mechanics have been hired. In contrast, 3,289 mechanics and related lost their jobs at United between 2003 and 2006 while they were represented by AMFA. United has cut more maintenance workers than any other U.S. airline. Additionally, thousands of mechanics lost their jobs at other AMFA-represented carriers, including Alaska and Northwest airlines. "Anyone who's seen what happened at United, or watched mechanics marched off the cliff at Northwest Airlines, understands that AMFA has to resort to lies to hang on to the members it has left," said Teamsters General President Jim Hoffa. Despite AMFA claims, there has been no job loss at Teamster- represented carriers. United Airline mechanics are in the midst of voting to switch representation to the Teamsters from AMFA. The voting period ends March 31. Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico. There are 40,000 Teamsters airline employees, including more than 9,000 mechanics and related at 11 airlines. 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. About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents, including Italy, Spain, Japan, China, Venezuela and Argentina. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. (Northwest Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). About Alaska Airlines Headquartered in Seattle, Washington, Alaska Airlines Inc. -- http://alaskaair.com/-- is a wholly owned subsidiary of Alaska Air Group Inc. (NYSE: ALK). Air Group is also the parent company of Horizon Air Industries Inc. and Alaska Air Group Leasing. Alaska Airlines and Horizon Air together serve 92 cities through an expansive network in Alaska, the Lower 48, Hawaii, Canada and Mexico. * * * On Sept. 4, 2003, Standard & Poors' assigned its BB- corporate credit rating on Alaska Airlines Inc. and Alaska Air Group Inc. Ratings still hold as of March 19, 2008. Outlook is negative. On March 4, 2003, Moody's assigned B1 long term corporate family rating and a stable outlook to Alaska Air. That rating still holds as of March 19, 2008. ALOHA AIRLINES: Files Voluntary Chapter 22 Petition in Hawaii ------------------------------------------------------------- Aloha Airgroup Inc., and its subsidiary Aloha Airlines, filed voluntary petitions for protection under Chapter 11 in the U.S. Bankruptcy Court for the District of Hawaii. Aloha will seek the Court's approval to allow the company to continue operating. Aloha is also seeking Court approval of a cash collateral financing arrangement with its principal working capital lender, General Motors Acceptance Corporation, to provide financing for operations pending a further hearing in accordance with bankruptcy rules. In doing so, Aloha seeks to protect 3,500 jobs, honor thousands of passenger travel reservations, keep the U.S. Mail and air cargo moving between the islands, and continue providing essential ground-handling services for domestic and international airlines serving Hawaii. In its filing, Aloha cited its inability to generate sufficient revenues from its inter-island passenger business due to predatory pricing by Mesa Air Group's go! airline. In the competitive inter-island market, Aloha was forced to match go!'s below-cost fares at a time when the airline industry was facing unprecedented increases in the cost of jet fuel. Late last week, crude oil rose to an all-time record high of $111 a barrel. For Aloha that means an annual increase of $71 million in fuel expenses. "It is a travesty and a tragedy that the illegal actions of a competitor and other factors completely beyond our control have forced us to take this action," David A. Banmiller, Aloha's president and chief executive officer, said. "Through this filing, we hope to achieve a successful outcome that will protect the jobs of 3,500 dedicated employees who have made extraordinary sacrifices for Aloha, and to continue to earn the support of our loyal customers, business partners, vendors and financial backers. "We are reaching out to all our friends here in Hawaii and around the world to continue to support Aloha Airlines as we work round- the-clock making every effort to continue our 61-year tradition of serving our island home in the spirit of Aloha," Mr. Banmiller added. Chapter 22 This is the airline's second bankruptcy filing. Aloha filed for Chapter 11 protection on Dec. 30, 2004 (Bankr. D. Hawaii Case No. 04-03063). On November 26, 2005, the Court entered an order confirming the joint plan of reorganization proposed by Airgroup and Aloha and Yucaipa Corporate Initiatives Fund I, L.P.. The effective date of the Prior Plan occurred on February 17, 2006. About Aloha Airgroup Inc. Headquartered in Honolulu, Hawaii, Aloha Airgroup Inc. -- http://www.alohaairlines.com/-- flies passengers and freight to Hawaii's five major airports. The company's principal operating subsidiary is Aloha Airlines Inc. It operates a fleet of about 20 aircraft, all Boeing 737s, including three configured as freighters. Aloha Airgroup emerged from Chapter 11 bankruptcy protection in 2006. Shareholders include investment firm Yucaipa Companies, the Ching and Ing families of Honolulu, and United Airlines, which is also a code-sharing partner. Aloha Airlines began operations in 1946. ALOHA AIRLINES: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Lead Debtor: Aloha Airlines, Inc. P.O. Box 30028 Honolulu, HI 96820 Bankruptcy Case No.: 08-00337 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Aloha Airgroup, Inc. 08-00338 Airgroup Acquisition Corp. 08-00339 Type of Business: The Debtors are carriers that fly passengers and freight to Hawaii's five major airports, as well as to half a dozen destinations in the western US. They operate a fleet of about 20 aircraft, all Boeing 737s, including three configured as freighters. See http://www.alohaairlines.com/ Chapter 11 Petition Date: March 18, 2008 Court: District of Hawaii (Honolulu) Judge: Lloyd King Debtors' Counsel: Brian G. Rich, Esq. (brich@bergersingerman.com) Jordi Guso, Esq. (jguso@bergersingerman.com Paul Steven Singerman, Esq. (singerman@bergersingerman.com) Berger Singerman PA 3200 South Biscayne Blvd., Ste. 1000 Miami, FL 33331 303-755-9500 Fax : 305-714-4340 http://www.bergersingerman.com/ -- and -- David C. Farmer, Esq. (farmerd001@hawaii.rr.com) P.O. Box 2372 Honolulu, HI 96804 Tel: (808) 222-3133 Fax: (866) 559-2922 Estimated Assets: $100 million to $500 million Estimated Debts: $100 million to $500 million Debtors' Consolidated List of 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Transportation Security $7,532,000 Administration Office of Chief Counsel 601 South 12th Street, West Building T8A-2 12th Floor Arlington, Va 22202 United Airlines $5,495,083 P.O. Box 66100 Chicago, IL 60666 Hawaii Medical Services $2,051,459 P.O. Box 4720 Honolulu, HI 96812-4720 State of Hawaii $1,262,832 D.O.T.-Airport Division 400 Rogers Boulevard, Suite 700 Honolulu, HI 96819-1880 Latham & Watkins $1,190,782 P.O. Box 894256 Los Angeles, CA 90189-4256 Coopesa $1,082,355 300 Oeste de Aeropuerto Int. Juan Santamaria Apdo Postal 10108-1000 San Jose, Costa Rica Aero Controls, Inc. $936,739 Attn: Staci Schachner P.O. Box 837 Auburn, WA 98071-0837 State of Hawaii D.O.T. $928,327 Airport Division 400 Rogers Boulevard Suite 700 Honolulu, HI 96819-1880 Aerothrust Corp. $500,000 P.O. Box 522236 Miami, FL 33152 Trans Air $471,980 P.O. Box 29239 Honolulu, HI 96820 Costa Mesa Marriott Suites $461,696 P.O. Box 403003 Atlanta, GA 30384-3003 Boeing Commercial $352,677 Airplane Co. Los Angeles, CA 90074-0645 EDS Corp. $346,716 P.O. Box 281935 Atlanta, GA 30384-1935 ST Aerospace Engines PTE $313,118 501 Airport Road Paya Lebar, Singapore, Malasia Hallmark Aviation Services $313,091 5757 Century Boulevard, Suite 860 Los Angeles, CA 90045 Unical Aviation, Inc. $271,991 P.O. Box 31001-0964 Pasadena, CA 91110-0964 Corporate Air $249,480 The Sabre Group $244,951 Dell Inc. $237,209 Galileo International, LLC $185,000 AMERICAN COLOR: Noteholders Extend 2008 Notes Due Date to June 15 ----------------------------------------------------------------- American Color Graphics Inc. said in a regulatory filing with the Securities and Exchange Commission that on March 14, 2008, holders of 97.6% of the aggregate principal amount of its Non-Interest Bearing Senior Second Secured Notes Due 2008 agreed with the company 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 currently due June 15, 2008, in respect of Graphics' 10% Senior Second Secured Notes Due 2010 becomes 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 Inc. and an unaffiliated third party. The maturity of the amended 2008 Notes can also be accelerated upon the occurrence of certain other events. On March 14, 2008, holders of 90.0% of the aggregate principal amount of the company's 2010 Notes also agreed with Graphics to amend certain covenants in the Indenture for the 2010 Notes and the 2008 Notes to provide that the rights and remedies of the Trustee and the holders of the 2010 Notes in the Collateral will be subordinate and subject to the rights and remedies of the holders of the 2008 Notes with respect to the Junior Liens. A full-text copy of the Second Supplemental Indenture, dated as of March 14, 2008, among Graphics, Holdings, and The Bank of New York Trust Company N.A., as trustee, is available for free at: http://researcharchives.com/t/s?2963 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. AMERIQUEST MORTGAGE: Fitch Takes Various Rating Actions Certs. -------------------------------------------------------------- Fitch Ratings has taken these rating actions on one Ameriquest Mortgage Co. mortgage pass-through certificate transaction. Affirmations total $799.8 million and downgrades total $414.8 million. Additionally, $546.5 million remains or was placed on Rating Watch Negative. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions: Argent Securities Inc. (ARSI) series 2005-W4 -- $428.2 million class A-1A2 affirmed at 'AAA', (BL: 57.51, LCR: 3.01); -- $151.8 million class A-1A3 affirmed at 'AAA', (BL: 41.98, LCR: 2.20); -- $145.0 million class A-1B rated 'AAA', remains on Rating Watch Negative (BL: 41.39, LCR: 2.17); -- $13.4 million class A-2B affirmed at 'AAA', (BL: 99.09, LCR: 5.19); -- $206.3 million class A-2C affirmed at 'AAA', (BL: 69.18, LCR: 3.63); -- $181.4 million class A-2D rated 'AAA', placed on Rating Watch Negative (BL: 41.20, LCR: 2.16); -- $147.7 million class M-1 downgraded to 'A' from 'AA+', placed on Rating Watch Negative (BL: 31.83, LCR: 1.67); -- $72.3 million class M-2 downgraded to 'BBB' from 'A+', placed on Rating Watch Negative (BL: 27.34, LCR: 1.43); -- $39.3 million class M-3 downgraded to 'BB' from 'A' (BL: 24.89, LCR: 1.30); -- $37.7 million class M-4 downgraded to 'B' from 'A-' (BL: 22.50, LCR: 1.18); -- $36.1 million class M-5 downgraded to 'B' from 'BBB' (BL: 20.15, LCR: 1.06); -- $26.7 million class M-6 downgraded to 'CCC' from 'BBB-' (BL: 18.34, LCR: 0.96); -- $28.3 million class M-7 downgraded to 'CCC' from 'BB+' (BL: 16.50, LCR: 0.86); -- $26.7 million class M-8 downgraded to 'CCC' from 'B+' (BL: 15.12, LCR: 0.79). Deal Summary -- Originators: 100% Argent Mortgage Co. -- 60+ day Delinquency: 31.09%; -- Realized Losses to date (% of Original Balance): 1.62%; -- Expected Remaining Losses (% of Current balance): 19.08%; -- Cumulative Expected Losses (% of Original Balance): 11.47%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. -- 'Fitch Places $139B U.S. Subprime RMBS On Watch Negative on Worsening Mortgage Performance' (Feb. 1, 2008); -- 'Downgrade Criteria for Recent Vintage U.S. Subprime RMBS' (Aug. 8, 2007); -- 'U.S. Subprime RMBS/HEL Upgrade/Downgrade Criteria' (June 12, 2007). AMERIQUEST MORTGAGE: Eight Certs. Obtain Fitch's Low-B Ratings -------------------------------------------------------------- Fitch Ratings has taken rating action on these Ameriquest Mortgage Co. mortgage pass-through certificates: AMSI, series 2004-R6: -- Class A-1 affirmed at 'AAA' and removed from Rating Watch Negative; -- Class A-4 affirmed at 'AAA' and removed from Rating Watch Negative; -- Class M-1 affirmed at 'A-'; -- Class M-2 affirmed at 'BBB+'; -- Class M-3 affirmed at 'BBB'; -- Class M-4 affirmed at 'BBB-'; -- Class M-5 downgraded to 'B' from 'BB+'. ARSI, series 2004-W4: -- Class A downgraded to 'AA' from 'AAA' and removed from Rating Watch Negative; -- Class M-1 affirmed at 'BBB+'; -- Class M-2 affirmed at 'BBB'; -- Class M-3 downgraded to 'BB' from 'BBB-'; -- Class M-4 downgraded to 'B' from 'BB+'. PPSI, series 2004-MCW1: -- Class A-1 affirmed at 'AAA' and removed from Rating Watch Negative; -- Class A-2 & A-5 affirmed at 'AAA'; -- Class M-1 affirmed at 'AA+'; -- Class M-2 downgraded to 'A+' from 'AA'; -- Class M-3 downgraded to 'A-' from 'AA-'; -- Class M-4 downgraded to 'BBB' from 'A+'; -- Class M-5 downgraded to 'BB+' from 'A-'; -- Class M-6 downgraded to 'BB' from 'BBB+'; -- Class M-7 downgraded to 'BB' from 'BBB'; -- Class M-8 downgraded to 'B' from 'BB+'; -- Class M-9 downgraded to 'B' from 'BB'; -- Class M-10 downgraded to 'C/DR6' from 'B'. The affirmations, affecting approximately $233.8 million of the outstanding certificates, reflect a stable relationship between credit enhancement and expected loss. The downgrades, affecting approximately $282.4 million of the outstanding certificates, are taken as a result of a deteriorating relationship between credit enhancement and expected loss. In addition, four classes are removed from Rating Watch Negative, affecting approximately $197.8 million of the outstanding certificates. These classes are insured by XL Capital and were placed on Rating Watch Negative in December 2007 as a result of Fitch placing the Insurer Financial Strength rating of Security Capital Assurance Ltd. and subsidiaries on Negative Watch. Fitch's policy is to maintain ratings on insured transactions at the higher of the underlying rating of the insured transaction if rated by Fitch, or the Fitch rating of the insurer. The collateral of the above transactions generally consists of fixed-rate and adjustable-rate mortgage loans extended to subprime borrowers and secured by first-liens on one- to four-family residential properties. The loans collateralizing the Ameriquest Mortgage Securities Inc. transaction were originated or acquired by Ameriquest Mortgage Co. and are serviced by Citi Residential Lending Inc. (rated 'RPS3+' by Fitch). The loans collateralizing the Argent Securities Inc. transaction were originated or acquired by Argent Mortgage Co. and are serviced by Citi Residential Lending Inc. (rated 'RPS3+'). The loans collateralizing the Park Place Securities Inc. transaction were originated or acquired by Ameriquest Mortgage Co. or Argent Mortgage Co. and are serviced by Countrywide Home Loans Inc. (rated 'RPS1-'). As of the February 2008 remittance date, the pool factor (current mortgage loan principal outstanding as a percentage of the initial pool) of AMSI 2004-R6 is 16%, ARSI 2004-W4 is 16%, and PPSI 2004- MCW1 is 18%. In addition, AMSI 2004-R6 is seasoned 45 months, ARSI 2004-W4 is seasoned 48 months, and PPSI 2004-MCW1 is seasoned 42 months. AMES TRUE: S&P Changes Outlook to Stable; Confirms 'CCC+' Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Camp Hill, Pennsylvania-based Ames True Temper Inc. to stable from negative. At the same time, Standard & Poor's affirmed all of its ratings on the company, including its 'CCC+' corporate credit rating. "The outlook revision reflects the company's improved liquidity position resulting from inventory reductions and positive free cash flow generation in fiscal 2007," said Standard & Poor's credit analyst Christopher Johnson. Ames reduced its revolver borrowings by about $24 million in fiscal 2007, prior to rebuilding working capital in the first quarter of fiscal 2008, ahead of the peak selling season in its fiscal second and third quarters. In addition, the favorable snow fall in this fiscal first quarter resulted in a good winter selling season for Ames' customers. Despite the slowing economy, this will somewhat limit the downside risk to the company's fiscal 2008 budget, as retailers will need to restock snow equipment for the 2009 snow season. "We believe the company will have adequate availability on its borrowing base revolving credit facility throughout fiscal 2008," said Mr. Johnson. Therefore it is unlikely that Ames' springing minimum EBITDA covenant (of $41 million) will be triggered (an event that occurs when availability on the revolver is less than $15 million). At the same time, Standard & Poor's assigned recovery ratings to Ames' unsecured debt issues. The issue-level rating on Ames' $150 million senior floating rate notes was affirmed at 'CCC+' (the same as the corporate credit rating on the company), and a recovery rating of '4' was assigned to this debt, indicating the expectation for average (30%-50%) recovery in the event of a payment default. The issue-level rating on Ames' $150 million 10% senior subordinated notes was affirmed at 'CCC-' (two notches lower than the 'CCC+' corporate credit rating on the company), and a recovery rating of '6' was assigned to this debt, indicating the expectation for negligible (0%-10%) recovery in the event of a payment default. The ratings on Ames reflect competitive industry dynamics, and the company's narrow product portfolio, seasonal business characteristics, limited geographic diversification, product and customer concentration, and a highly leveraged capital structure. APOLLO DRILLING: Posts $335,666 Net Loss in 2007 Second Quarter ---------------------------------------------------------------- Apollo Drilling Inc. reported a net loss of $335,666 for the second quarter ended June 30, 2007, compared with a net loss of $689,004 in the same period ended June 30, 2006. The company reported zero revenues in both periods. At June 30, 2007, the company's consolidated balance sheet showed $2,253,615 in total assets, $1,553,205 in total liabilities, and $700,410 in total stockholders' equity. The company's balance sheet at June 30, 2007, also showed strained liquidity with $581,726 in total current assets available to pay $1,553,205 in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?2947 Going Concern Disclaimer De Joya Griffith & Company LLC, in Henderson, Nevada, expressed substantial doubt about Apollo Drilling Inc.'s ability to continue as a going concern following its audit of the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's losses from operations. About Apollo Drilling Headquartered in Dallas, Apollo Drilling Inc. (OTC: APDR) -- http://www.apollodrillinginc.com/-- is engaged in oil and natural gas exploration and production. The company derives its revenue primarily from providing oil and natural gas exploration drilling services. ASSOCIATED ESTATES: Completes Sale of Toledo, Ohio Portfolio ------------------------------------------------------------ Associated Estates Realty Corporation completed the sale of its Toledo, Ohio portfolio to a privately held, national apartment company. The Toledo portfolio was comprised of four properties built between 1973 and 1990, consisting of 1,060 units. The sale price reflects an overall capitalization rate of 7%, based on trailing 12 month net operating income and after $800 in capital expenditures and a 3% management fee. "These sales are consistent with our plans to exit certain markets," Jeffrey I. Friedman, president and chief executive officer, said. The company expects to use the proceeds from the sale to either acquire properties, pay down debt or for general corporate purposes. About Associated Estates Realty Based in Richmond Heights, Ohio, Associated Estates Realty Corporation (NYSE: AEC) -- http://www.aecrealty.com/-- is a real estate investment trust and is a member of the Russell 2000 Index. The company directly or indirectly owns, manages or is a joint venture partner in 98 properties containing a total of 19,909 units located in 10 states. * * * Moody's Investor Service placed Associated Estates Realty Corporation's long term foreign and local issuer credit ratings at 'B+' on July 2007. The ratings still hold today with a stable outlook. BCE INC: Court to Consider Bell Noteholders' Appeal on April 28 --------------------------------------------------------------- BCE Inc. disclosed that the Quebec Court of Appeal established schedules for the legal proceedings related to the appeals initiated by certain holders of Bell Canada debentures. The schedule provides for three and a half days of hearings, over a maximum period of five days, beginning on April 28, 2008. The Court has indicated that it expects to render a decision expeditiously. "We are very pleased that the Court of Appeal has agreed to a schedule that will allow for the expeditious resolution of these appeals," Martine Turcotte, chief legal officer of BCE and Bell Canada, said. "Our position from the start, which was supported on every point of contention by the Qu�bec Superior Court, is that the claims of these debentureholders are without merit." "We believe that the Superior Court's decisions will be upheld," Ms. Turcotte added. "As the Superior Court has concluded, BCE and Bell Canada have respected all of the rights and reasonable expectations of the debentureholders." As a result of the Court of Appeal schedule ordered, BCE expects the transaction to close before the end of the second quarter of 2008. About BCE Inc. Headquartered in Montreal, Quebec, BCE Inc. (TSX/NYSE: BCE) -- http://www.bce.ca/-- is a communications company, providing comprehensive and innovative suite of communication services to residential and business customers in Canada. Under the Bell brand, the company's services include local, long distance and wireless phone services, high-speed and wireless Internet access, IP-broadband services, information and communications technology services (or value-added services) and direct-to-home satellite and VDSL television services. Other BCE holdings include Telesat Canada and an interest in CTVglobemedia. Bell Canada -- http://www.bell.ca/-- is a wholly owned subsidiary of BCE Inc. Bell offers integrated information and communications technology services to businesses and governments, and is the Virtual Chief Information Officer to small and medium businesses. * * * As reported in the Troubled Company Reporter on Dec. 14, 2007, Standard & Poor's Ratings Services kept its ratings on BCE Inc. and its related entities on CreditWatch with negative implications, pending the completion of the company's leveraged buyout by a consortium of private equity investors led by Teachers Private Capital as announced on June 30, 2007. As a result of the proposed LBO, S&P expect reported debt to increase to about CDN$37 billion from about CDN$10 billion at Sept. 30, 2007. As reported in the Troubled Company Reporter on Sept. 26, 2007, Standard & Poor's Ratings Services lowered its long-term corporate credit ratings on BCE Inc. and wholly owned subsidiary Bell Canada to 'BB-' from 'A-'. BEACH HOUSE: Can Employ Furr and Cohen as Bankruptcy Counsel ------------------------------------------------------------ Judge A. Jay Cristol of the U.S. Bankruptcy Court for the Southern District of Florida in Miami permitted Beach House Property, LLC to employ Robert C. Furr, Esq., at Furr and Cohen in Boca Raton, Florida, as its bankruptcy counsel. As bankruptcy counsel, Furr and Cohen will: -- give advice to the Debtor with respect to its powers and duties as a debtor-in-possession and the continued management of its business operations; -- advise 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; -- prepare motions, pleadings, orders, applications, adversary proceedings, and other legal documents necessary in the administration of the case; -- protect the interest of the Debtor in all matters pending before the Court; and -- represent the Debtor in negotiation with its creditors in the preparation of a chapter 11 bankruptcy plan. Beach House believes that Furr and Cohen is qualified to practice before the Court and is qualified to advise the Debtor on its relations with, and responsibilities to, the creditors and other interested parties. Mr. Furr attests that neither his firm nor he has any connection with the creditors or other parties-in-interest or their attorneys, and that he and his firm do not represent any interest adverse to the Debtor. Beach House Property, L.L.C. of Surfside, Florida, owns various real estate properties. The Debtor commenced chapter 11 proceedings Feb. 15, 2008, before the U.S. Bankruptcy Court for the Southern District of Florida in Miami (Case No. 08-11761). Robert C. Furr, Esq., at Furr and Cohen in Boca Raton, Florida, represents the Debtor. When it filed for bankruptcy, Beach House estimated assets between $50 million and $100 million, and debts between $10 million to $50 million. BEACH HOUSE: U.S. Trustee Sets Sec. 341 Meeting on March 27 ----------------------------------------------------------- The United States Trustee for the Southern District of Florida will convene a meeting of creditors of Beach House Property, LLC, on March 27, 2008, at 2:00 p.m. The meeting will be held at Claude Pepper Federal Bldg, 51 SW First Ave Room 1021, in Miami. This is the first meeting of creditors under Sec. 341 of the Bankruptcy Code. Creditors are welcome to attend, but are not required to do so. The debtor's representative must be present at the meeting to be questioned under oath by the trustee and by creditors. The meeting may be continued and concluded at a later date without further notice. Without further notice or hearing the bankruptcy court may dismiss a debtor's case for failure of the debtor to appear at the meeting of creditors or failure to timely file required schedules of assets and liabilities, and statements of financial affairs. Beach House Property, L.L.C. of Surfside, Florida, owns various real estate properties. The Debtor commenced chapter 11 proceedings Feb. 15, 2008, before the U.S. Bankruptcy Court for the Southern District of Florida in Miami (Case No. 08-11761). Robert C. Furr, Esq., at Furr and Cohen in Boca Raton, Florida, represents the Debtor. When it filed for bankruptcy, Beach House estimated assets between $50 million and $100 million, and debts between $10 million to $50 million. BEACH HOUSE: Files Schedules of Assets and Liabilities ------------------------------------------------------ Beach House Property, L.L.C. delivered to the U.S. Bankruptcy Court for the Southern District of Florida its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $58,000,000 B. Personal Property 17,552,185 C. Property Claimed as Exempt D. Creditors Holding $42,103,592 Secured Claims E. Creditors Holding 493,245 Unsecured Priority Claims F. Creditors Holding 3,882,361 Unsecured Nonpriority Claims ------------ ------------ TOTAL $75,552,185 $46,479,198 Beach House Property, L.L.C. of Surfside, Florida, owns various real estate properties. The Debtor commenced chapter 11 proceedings Feb. 15, 2008, before the U.S. Bankruptcy Court for the Southern District of Florida in Miami (Case No. 08-11761). Robert C. Furr, Esq., at Furr and Cohen in Boca Raton, Florida, represents the Debtor. When it filed for bankruptcy, Beach House estimated assets between $50 million and $100 million, and debts between $10 million to $50 million. BEACH HOUSE: Creditors Have Until June 25 to File Claims -------------------------------------------------------- Creditors of Beach House Property, L.L.C., have until June 25, 2008, to file proofs of claim against the bankruptcy estate, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of Florida. Governmental units have until August 15, 2008, to file proofs of claim. Beach House Property, L.L.C. of Surfside, Florida, owns various real estate properties. The Debtor commenced chapter 11 proceedings Feb. 15, 2008, before the U.S. Bankruptcy Court for the Southern District of Florida in Miami (Case No. 08-11761). Robert C. Furr, Esq., at Furr and Cohen in Boca Raton, Florida, represents the Debtor. When it filed for bankruptcy, Beach House estimated assets between $50 million and $100 million, and debts between $10 million to $50 million. BEAR STEARNS: Largest Shareholder Opposes JP Morgan Purchase ------------------------------------------------------------ Joseph Lewis, Bear Stearn Companies Inc.'s largest shareholder, plans to evaluate the proposed acquisition of the investment banker by J.P. Morgan Chase & Co. for $2.32 a share, or $339 million, Zachary R. Mider and Miles Weiss of Bloomberg News report. As reported in the Troubled Company Reporter on March 17, 2008, Bear Stearns has agreed to be bought by JPMorgan Chase. The Boards of Directors of both companies have unanimously approved the transaction. The transaction will be a stock-for- stock exchange. JPMorgan Chase will exchange 0.05473 shares of JPMorgan Chase common stock per one share of Bear Stearns stock. According to a filing with the U.S. Securities and Exchange Commission, Mr. Lewis, who has shared voting power and shared dispositive power with shares owned directly by Aquarian Investments Ltd., Cambria, Darcin Inc., Mandarin Inc. and Nivon Inc., stated that he will take whatever action that he deems necessary and appropriate to protect his investments in Bear Stearns, including discussions with other shareholders to consider other strategic alternatives. Mr. Lewis disclosed that he will formulate plans or proposals that would involve, among other things: a) holding his securities as a passive investor or as an active investor; b) acquiring beneficial ownership of additional securities in the open market, in privately negotiated transactions or otherwise; c) disposing of all or part of his holdings of securities; d) engaging in short selling of or hedging of his shares in Bear Stearns; and e) taking other actions which could involve one or more of the types of transactions. As of March 18, 2008, Mr. Lewis may be deemed to beneficially own, in the aggregate, 12,136,724 shares, representing 8.35% of the Bear Stearns' outstanding shares. Aquarian, Cambria, Darcin, Mandarin and Nivon have shared voting power and shared dispositive power with regard to the 650,000, 1,475,300, 1,537,700, 5,624,443 and 2,849,281 shares that they own directly. About Bear Stearns New York City-based The Bear Stearns Companies Inc. (NYSE: BSC) -- http://www.bearstearns.com/-- is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. The company has approximately 14,000 employees worldwide. * * * As reported in the Troubled Company Reporter on Dec. 28, 2007, Fitch Ratings' affirmed its Negative Outlook for The Bear Stearns Companies Inc. following the announcement of the company's fiscal year earnings for 2007. On Nov. 14, 2007, Fitch affirmed Bear Stearns' long-term credit ratings, along with its subsidiaries. Fitch also downgraded the short-term rating to 'F1' from 'F1+', and Individual rating to 'B/C' from 'B'. BEAR STEARNS: Citic Securities Withdraws $120 Per Share Offer ------------------------------------------------------------- Citic Securities, a part of Chinese state-owned company Citic Group, confirmed last week that it would discontinue its planned investment with Bear Stearn Companies Inc. Citic Securities discarded its proposal to acquire $1 billion preferred securities in the investment banker for $120 per share, Sameera Anand of FinanceAsia.Com reports. Talks between both companies started in the third quarter of 2007, FinanceAsia.Com relates. Both companies agreed on a strategic partnership on Oct. 22, 2007. The agreement also stated that in exchange, Bear Stearns was supposed to invest $1 billion in Citic equity. Bear Stearns has agreed to be bought by JPMorgan Chase & Co. for $2.32 a share, or $339 million, Zachary R. Mider and Miles Weiss of Bloomberg News relate. As reported in the Troubled Company Reporter on March 17, 2008, the Boards of Directors of both companies have unanimously approved the transaction. The transaction will be a stock-for-stock exchange. JPMorgan Chase will exchange 0.05473 shares of JPMorgan Chase common stock per one share of Bear Stearns stock. New York City-based The Bear Stearns Companies Inc. (NYSE: BSC) -- http://www.bearstearns.com/-- is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. The company has approximately 14,000 employees worldwide. * * * As reported in the Troubled Company Reporter on Dec. 28, 2007, Fitch Ratings' affirmed its Negative Outlook for The Bear Stearns Companies Inc. following the announcement of the company's fiscal year earnings for 2007. On Nov. 14, 2007, Fitch affirmed Bear Stearns' long-term credit ratings, along with its subsidiaries. Fitch also downgraded the short-term rating to 'F1' from 'F1+', and Individual rating to 'B/C' from 'B'. BLUE WATER: Wants to Hire Huron as Financial Consultants -------------------------------------------------------- Blue Water Automotive Systems, Inc., and its debtor-affiliates ask Judge Marci B. McIvor of the United States Bankruptcy Court for the Eastern District of Michigan for authority to employ Huron Consulting Services, LLC, as their financial consultants, nunc pro tunc to February 12, 2008. Judy A. O'Neill, Esq., at Foley & Lardner LLP, in Detroit, Michigan, relates that Huron Consulting and the Debtors entered into an Engagement Agreement on January 21, 2008, which provides for Huron Consulting to act as exclusive financial consultants to the Debtors in connection with modifying their credit arrangements and commercial terms with certain customers. The Debtors believe that continued representation by Huron Consulting is critical to their efforts to restructure their business. As the Debtors' financial advisors, Huron Consulting will: (1) provide to the Debtors financial consulting services; (2) assist the Debtors in preparing financial analyses in support of reaching out to their key customers, including liquidity budgets and other prospective financial information; (3) meet with and provide counsel to the Debtors relating to their key constituents; (4) assist with the preparation, accumulation and review of financial data that will be required to assess potential arrangements with the Debtors' key customers; (5) perform a thorough assessment of the Debtors' historical financial performance and financial projections to determine strategic alternatives and the feasibility of the Debtors' long-term plans; and (6) assist with the review and negotiation of modified term sheets between the Debtors and their commercial lending and customer relationships. The Debtors will compensate Huron Consulting's professionals based on actual hours rendered at these rates: Title Hourly Rate ----- ----------- Managing Director $625 Director $550 Manager $450 Associate $350 Analyst $275 On a monthly basis, the Debtors will reimburse the firm all reasonable and actual out-of-pocket expenses it incurs. John C. DiDonato, managing director at Huron Consulting, assures the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. He, however, discloses that Huron is a creditor to the Debtors in a way since the Debtors owe it $386,854 for fees and costs incurred from January 21 to February 11, 2008. Huron has agreed to waive and release its claim against the Debtors. In a letter agreement, Ford Motor Corporation agreed to pay $264,415 of Huron's prepetition claim. According to Ms. O'Neill, Ford has agreed to pay a portion of Huron's claim to avoid the much greater costs of production line interruptions that could occur or be aggravated if Huron resigned from its engagement with the Debtors. Pursuant to Section 327 of the Bankruptcy Code, Ms. O'Neill argues that Huron is a "disinterested person" and does not hold adverse interest to all parties on the grounds that: * the proposed payment arrangement has been fully disclosed to the Debtors, Ford and the Court through the Letter Agreement; * the Debtors have consented to the arrangement in the disclosure and consent letter; * Ford has an independent legal counsel and clearly understands that Huron's loyalty in the Debtors' Chapter 11 cases is exclusive to the Debtors and their estates; and * Huron has demonstrated and represented to the Court the absence of facts, which would otherwise create non-disinterestedness, actual conflict, or impermissible potential for a conflict of interest arising from the payment by Ford. St. Clair Objects St. Clair Packaging, Inc., objects to the employment request because the request does not provide for payment of any other administrative expenses by either th Debtors or the third-party customer Ford. St. Clair notes that the request proposes for the Debtors to sacrifice payment of the Section 503(b)(9) claims in preference to payment of other obligations. St. Clair notes that the request fails to specify the practical need to employ Huron as consultants. The employment agreement has no budget or any limitation caps on services or fees. Without providing any explanation, St. Clair subsequently withdrew, without prejudice, its objection to the employment request. About Blue Water Automotive Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. (Blue Water Automotive Bankruptcy News, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000) BLUE WATER: Seeks to Tap Miller Buckfire as Investment Bankers -------------------------------------------------------------- Blue Water Automotive Systems, Inc., and its debtor-affiliates ask the United States Bankruptcy Court for the Eastern District of Michigan for permission to employ Miller Buckfire & Co., LLC, as their financial advisor and investment banker. The Debtors believe that Miller Buckfire's extensive experience in providing financial advisory and investment banking services will be beneficial to their estates. As financial advisor to the Debtors, Miller Buckfire will: (a) provide the Debtors financial advisory and investment banking services; (b) familiarize itself with the business, operations, properties, financial condition and prospect of the company; (c) provide financial advice and assistance to the Debtors in connection with a Sale, identify potential acquirors and, at the Debtors' request, contact these potential acquirors; (d) assist the Debtors in preparing a memorandum to be used in soliciting potential acquirors; (e) participate in negotiations with potential acquirors; and (f) advise and assist the Debtors in structuring and effecting the financial aspects of a Sale transaction. The Debtors will pay Miller Buckfire according to these payment terms: (a) an initial financial advisory fee of $75,000; (b) a monthly advisory fee of $75,000; and (c) a sale transaction fee, in the event the Debtors consummate a sale transaction, of 2.5% of the aggregate consideration of any such sale, provided that the minimum sale transaction fee in connection with the sale is $1,000,000. The Debtors will reimburse Miller Buckfire for all of its reasonable out-of-pocket expenses. Durc A. Savini, managing director at Miller Buckfire, assures the Court that the firm does not hold any interest adverse to all parties-in-interest, and is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Blue Water Automotive Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. (Blue Water Automotive Bankruptcy News, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000) BLUE WATER: Creditors Panel Can Hire Schafer as Counsel ------------------------------------------------------- Judge Marci B. McIvor of the United States Bankruptcy Court for the Eastern District of Michigan authorized the Official Committee of Unsecured Creditors appointed in the bankruptcy cases of Blue Water Automotive Systems, Inc., and its debtor-affiliates to retain Schafer and Weiner, PLLC, as its bankruptcy counsel. As reported in the Troubled Company Reporter on Feb. 26, 2008, Schafer will represent and assist the Creditors Committee with all aspects of its role in the Debtors' bankruptcy cases, as provided under Section 1103 of the Bankruptcy Code. Schafer will be paid according to its hourly rates and reimbursed for any necessary out-of-pocket expenses: Professionals Hourly Rates ------------- ------------ Senior Members US$295 - US$395 Junior Members US$230 - US$295 Associate US$260 - US$145 Legal Assistant US$120 Michael E. Baum, Esq., a member at Schafer & Weiner, PLLC, in Bloomfield Hills, Michigan, attests that his firm does not represent any interest adverse to the Creditors Committee and the Debtors' estate. He said his firm is a "disinterested person" as the term is defined in Section 101(14). About Blue Water Automotive Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. (Blue Water Automotive Bankruptcy News, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000) BLUE WATER: Creditors Panel Wants Stout Risius as Advisor --------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the bankruptcy cases of Blue Water Automotive Systems, Inc., and its debtor-affiliates asks the Hon. Marci B. McIvor of the United States Bankruptcy Court for the Eastern District of Michigan for authority to retain Stout Risius Ross, Inc., as its financial advisors. As financial advisors, Stout Risius will: (a) assist in the review of reports or filings as required by the Bankruptcy Court or the Office of the United States Trustee, including schedules of assets and liabilities, statements of financial affairs and monthly operating reports; (b) review the Debtors' financial information, including, but not limited to, analyses of cash receipts and disbursements, financial statement items and proposed transactions; (c) review and analyze the reporting regarding cash collateral and any DIP Financing arrangements and budgets; (d) evaluate potential employee retention and severance plans; (e) assist with identifying and implementing potential cost containment and asset redeployment opportunities; (f) analyze assumption and rejection issues regarding executory contracts and leases; (g) review and analyze the Debtors proposed business plans and the business and financial condition of the Debtors' generally; (h) assist in evaluating reorganization strategy and alternatives available to the creditors; (i) review and criticize the Debtors' financial projections and assumptions; (j) prepare and review enterprise, asset and liquidation valuations; (k) assist in preparing and or reviewing documents necessary for confirmation; (l) advise and assist with Committee negotiations and meetings with the Debtors, the bank lenders and customers; (m) advise and assist on tax consequences of proposed plans of reorganization; (n) assist with the claims resolution procedures, including, but not limited to, analyses of creditors' claims by type and entity; and (o) provide litigation consulting services and expert witness testimony regarding confirmation issues, avoidance actions or other matters. Stout Risius will be paid according to its customary hourly rates: Professional Hourly Rates ------------ ------------ Managing Directors $395 Directors $330 - 390 Managers $240 - 330 Senior Associates $175 - 225 Staff Associates $100 - 150 Paraprofessionals $80 Gary W. Burns, managing director of Stout Risius, assures the Court that his firm represents no adverse interests to all parties in involved in the Debtors' Chapter 11 cases, and is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Debtors Object Susan M. Cook, Esq., at Lambert, Leser, Isackson, Cook & Giunta, P.C., in Bay City, Michigan, proposed conflicts counsel to the Debtors, states that the Debtors have serious issues regarding the Official Committee of Unsecured Creditors' declaration that Stout Risius Ross, Inc., is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Ms. Cook notes that the affidavit of Gary W. Burns, a managing director at Stout Risius, disclosed that in 2005, Stout Risius analyzed the financial statements and cash flow forecasts regarding customers and vendors of Sarnamotive Blue Water Plastics, Inc., which is the Debtors' predecessor company. However, that disclosure was not discussed anywhere in the Committee's retention application and that Stout Risius' work for the Committee, which includes analysis of the issues the firm has assisted the Debtors before, will be detrimental to the Debtors since the law firm is believed to have obtained confidential information from its previous employment by Sarnamotive Blue Water, Ms. Cook argues. Ms. Cook further discloses that the Burns Affidavit also revealed Stout Risius' engagement as the "sell side" advisor/investment banker for the sale of Injectronics, which was purchased by the Debtors in 2005. "At no prior time did the Committee or Stout Risius contact the Debtors or their counsel to discuss these issues. However, the Debtors are attempting to resolve their objections with the Committee's retention of SRR without this Court's intervention, but for the meantime, the Debtors maintain their stand to deny the motion," Ms. Cook concludes. About Blue Water Automotive Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. (Blue Water Automotive Bankruptcy News, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000) BRAINTECH INC: Revises Fin'l Results to Show Stock Options Charges ------------------------------------------------------------------ Braintech Inc. will restate certain historical financial statements to record additional non-cash stock-based compensation charges. Braintech Inc. will restate its financial statements from the quarterly periods ended March 31, 2007, June 30, 2007 and Sept. 30, 2007, as a result of its year-end review. The company has determined that additional non-cash stock-based compensation should have been recorded with respect to certain stock options granted during the first and second quarter of 2007. Furthermore, as a result of these stock option grants in the first and second quarter of 2007, the company has determined that less non-cash stock-based compensation should have been recorded for the third quarter of 2007. The restatement will result in a net increase in the non-cash expense for the first quarter of 2007 of $380,942, for the second quarter of 2007 of $66,369 and a net decrease in non-cash expense for the third quarter of 2007 of $51,303. Frederick Weidinger, the new chief executive officer and president of Braintech, who joined Braintech in November 2007, indicated that "the need to restate the non-cash charges arose primarily from the company not having properly applied the various accounting rules that have come into effect recently relating to accounting for non-cash stock and stock option compensation." "While our decision to restate all three quarters is an over abundance of caution and the fact that the changes in the existing financial statements for such periods do not impact the cash flow or overall financial health of the company, it is critical that the company meticulously comply with all recent accounting pronouncements regarding the accounting of its financial statements," Mr. Weidinger said. Weidinger also indicated that he has "recently formed a board of advisors that will have at least one member who is an accounting professional with substantial accounting experience who, in addition to the company's new audit committee, will also be involved in overseeing the company's compliance with financial statement reporting requirements on a going forward basis." "While the restatement puts a bit of pressure on our 2007 financial statements, it relieves a bit of pressure going forward into 2008 and 2009 as a result of recognizing the change in timing of stock option expenses," Weidinger added. The company will submit its 10-KSB financial statements for the 12 months of 2007 by March 28, 2008. About Braintech Braintech Inc. (OTC BB: BRHI) generates majority of its revenues from the sale of computer software that it developed. Its software sales involved computerized vision systems used for the guidance of industrial robots performing automated assembly, material handling, and part identification and inspection functions. AS reported in the Troubled company Reporter on Apr 05, 2007, Smythe Ratcliffe LLP raised substantial doubt about Braintech Inc.'s ability to continue as a going concern citing recurring losses from operations after auditing the company's financial statements as of Dec. 31, 2006, and 2005. BRINX RESOURCES: Earns $223,256 in First Quarter Ended Jan. 31 -------------------------------------------------------------- Brinx Resources Ltd. reported net income of $223,256 on revenues of $495,292 for the first quarter ended Jan. 31, 2008, compared with a net loss of $15,847 on revenues of $247,789 in the first quarter ended Jan. 31, 2007. The increase in revenues is mainly due to the company's increased oil and gas production. The increase of net income was largely attributable to the increase in revenues and the decrease of direct costs as a percentage of revenues. Balance Sheet At Jan. 31, 2008, the company's consolidated balance sheet showed $2,702,465 in total assets, $136,434 in total liabilities, and $2,566,031 in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?2951 Going Concern Disclaimer Gordon, Hughes & Banks LLP, in Greenwood Village, Colorado, expressed substantial doubt about Brinx Resources Ltd.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Oct. 31, 2007 and 2006. The auditing firm said that the company has incurred losses since inception and has recently commenced principal operations. About Brinx Resources Headquartered in Albuquerque, New Mexico, Brinx Resources Ltd. (OTC BB: BNXR.OB) -- http://www.brinxresources.com/-- is an oil and gas exploration company. The company's current focus is on the continued exploration and development of its land portfolio comprised of working interests in the Three Sand Project in Noble County, Oklahoma (40% interest); the Owl Creek Project in McClain County, Oklahoma (42.5 to 70% interest); and the Palmetto Point Project in Mississippi (8 to 8.5% interest). CA INC: Ample Cash Flow Prompts S&P's Positive CreditWatch Listing ------------------------------------------------------------------ Standard & Poor's Ratings Services placed its 'BB' corporate credit and senior unsecured debt ratings on Islandia, New York- based CA Inc. on CreditWatch with positive implications. The CreditWatch listing reflects the company's prospects for sustained profitability and cash flow and capacity to fund moderate-size share repurchases and acquisitions. Free cash flow in fiscal 2007 totaled about $800 million, and S&P expects it could increase to the $1 billion area over time as improvements in CA's expense structure are realized. As of Dec. 31, 2007, cash and securities totaled about $2 billion, and funded debt amounted to about $2.6 billion. Additionally, the company had $250 million available under its $1 billion revolving credit facility expiring in August 2012. The CreditWatch placement also incorporates the dismissal of all pending charges against the company by the U.S. Attorney's Office for the Eastern District of New York and CA's fulfillment of the terms of its deferred prosecution agreement. CA also has remedied all prior outstanding accounting issues and material weaknesses. "We will meet with management to review CA's strategic direction and financial policy before resolving the CreditWatch," said Standard & Poor's credit analyst Phil Schrank. "Any upgrade likely will be limited to one notch because we expect that CA will still use its balance sheet strength to support acquisitions and share repurchases." CD COMMERCIAL: Fitch Maintains Low-B Ratings on Three Certificates ------------------------------------------------------------------ Fitch affirms CD Commercial Mortgage Trust, Series 2007-CD4, commercial mortgage pass-through certificates: -- $83,050,071 Class A-1 'AAA'; -- $100,000,000 Class A-2A 'AAA'; -- $1,066,703,000 Class A-2B 'AAA'; -- $464,222,000 Class A-3 'AAA'; -- $161,959,000 Class A-SB 'AAA'; -- $1,737,121,000 Class A-4 'AAA'; -- $998,756,000 Class A-1A 'AAA'; -- $594,982,000 Class A-MFX 'AAA'; -- $65,000,000 Class A-MFL 'AAA'; -- $585,733,000 Class A-J 'AAA'; -- Interest Only Class XP 'AAA' -- Interest Only Class XC 'AAA'; -- Interest Only Class XW 'AAA'; -- $41,249,000 Class B 'AA+'; -- $90,748,000 Class C 'AA'; -- $57,748,000 Class D 'AA-'; -- $41,249,000 Class E 'A+'; -- $49,498,000 Class F 'A'; -- $65,999,000 Class G 'A-'; -- $74,248,000 Class H 'BBB+'; -- $65,998,000 Class J 'BBB'; -- $74,248,000 Class K 'BBB-'; -- $24,749,000 Class L 'BB+'; -- $16,499,000 Class M 'BB'; -- $16,500,000 Class N 'BB-'; -- $40,500,000 Class WFC-X 'BBB+'; -- $7,700,000 Class WFC-1 'BBB+'; -- $8,700,000 Class WFC-2 'BBB'; -- $24,100,000 Class WFC-3 'BBB-'. The $16,500,000 Class O, $8,249,000 Class P, $16,500,000 Class Q, and $74,248,279 Class S are not rated by Fitch. Affirmations are due to the stable performance of the pool. There has been minimal pay down of the transaction since issuance. Currently one (0.4%) is in special serving. The loan transferred in October 2007 due to mortgage default and borrower bankruptcy; the borrower is MBS Cos. The multifamily property is located in Garland, TX, and reported a recent occupancy of 86.4%. The non- rated classes are sufficient to absorb the Fitch projected losses. Three loans maintain their investment grade shadow ratings. Nine West 57th Street is a 1.6 million square foot office building located in midtown New York City. The servicer reported occupancy as of October 2007 was 83%. The loan is interest-only with a coupon of 5.17% and a maturity date in 2012. The Ala Moana Portfolio consists of two retail centers and two office properties comprising nearly 2.0 million SF in Honolulu, Hawaii. Combined occupancy since issuance has remained flat, at 96.6% as of September 2007. The loan is interest-only with a coupon of 5.52% and a maturity date in 2011. One World Financial Center is located in downtown New York City and consists of 1.6 million SF. Occupancy has remained stable at 96.5% as of September 2007, compared to issuance of 98%. The loan is interest-only with a coupon rate of 5.83% and maturity date in 2017. There are no scheduled maturities in 2008, 2009 or 2010. Interest-only loans represent 60% of the pool, including the top 10 loans (39%) in the transaction. CENTENE CORP: S&P Designates 'BB' Rating on Negative CreditWatch ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB' counterparty credit rating on Centene Corp. on CreditWatch with negative implications. "This CreditWatch resulted from the announcement by Centene that the company's year-to-date February operating results are not meeting expectations," noted Standard & Poor's credit analyst Hema Singh. "Lower-than-expected operating results were caused by higher-than-budgeted medical costs in its Ohio aged, blind, and disabled population, and impacts from a harsher than expected flu season." The company said in its announcement that it is currently reviewing full-year 2008 guidance, including the effect on investment income of interest rate actions by the Federal Reserve during the first quarter. Centene will provide information on its first-quarter earnings conference call scheduled for April 22, 2008. In addition, Centene announced an acquisition of a company in a business which differs from its core business. This will be funded principally with bank debt which would increase financial leverage. Because of a weaker operating environment and lower- than-expected profitability and leverage, Centene's financial and operations risks are heightened. Standard & Poor's will consider the new expected level of profitability, the reason for the change, and any risks surrounding the planned acquisition. If downgraded, the senior debt ratings are likely to decline by one notch. CHEMTURA CORP: Posts $3.0 Million Net Loss in Year Ended Dec. 31 ---------------------------------------------------------------- Chemtura Corp. reported a net loss of $3.0 million on net sales of $3.75 billion for the year ended Dec. 31, 2007, compared with a net loss of $206.0 million on net sales of $3.46 billion for the yeare ended Dec. 31, 2006. The increase in sales primarily reflects a net $173.0 million attributable to acquisitions and divestitures, $61.0 million of favorable foreign currency impact, $43.0 million from higher selling prices and other increases of $12.0 million, primarily related to sales volume and product mix. The increases in selling prices occurred within the Polymer Additives, Performance Specialties and Consumer Products segments and were the result of passing raw material cost increases through to customers. The company's selling prices increases during the year have not offset increases in raw material costs during 2007. Operating profit of $59.0 million for 2007 increased $54.0 million as compared to operating profit of $5.0 million for 2006. This increase is primarily due a increase in gross profit of $29.0 million, lower antitrust costs of $55.0 million, lower merger costs of $17.0 million and a $61.0 million reduction in charges for the impairment of long-lived assets, partially offset by a $65.0 million increase in depreciation and amortization expense, $31.0 million higher facility closures, severance and related costs, higher SG&A of $6.0 million, an increased loss on sale of businesses of $4.0 million, a $1.0 million increase in research and development costs and other cost increases of $1.0 million. Loss from continuing operations for 2007 was $45.0 million, as compared to a loss of $273.0 million for the same period of 2006. This increase is primarily due to the increase in operating profit and decreases in interest expense, loss on early extinguishment of debt and income tax expense. Interest expense decreased by $15.0 million for 2007 compared with the same period in 2006. The decrease was due primarily to the early retirement of the company's 9.875% Senior Notes due 2012 and the Floating Rate Notes due 2010 in 2006. During 2006, the company recorded a loss on early extinguishment of debt of $44.0 million, which includes a $20.0 million loss from the May 2006 retirement of the 2010 Notes and a $24.0 million loss from the July 2006 retirement of the 2012 Notes. The company's income tax expense for continuing operations was $4.0 million for 2007 as compared with income tax expense of $126.0 million for the same period of 2006. The tax benefit of the company's pre-tax loss in 2007 was reduced by non-deductible antitrust costs, the establishment of tax reserves for uncertain tax positions and foreign income subject to U.S. taxation, net of the relief from tax law changes and income tax credits, resulting in tax expense of $4.0 million for the year. Discontinued Operations For 2007, the company recorded a gain on sale of discontinued operations of $24.0 million. The net after-tax gain is comprised of a gain of $3.0 million related to the sale of the OrganoSilicones business representing the recognition of final contingent earn-out proceeds, a gain of $23.0 million related to the sale of the EPDM business on July 29, 2007, and a loss of $2.0 million related to the sale of optical monomers on Oct. 31, 2007. For 2006, the company recorded a gain on sale of discontinued operations of $47.0 million related to the sale of the OrganoSilicones business to General Electric Company in July of 2003. This gain primarily represents the recognition of the additional contingent earn-out proceeds. Earnings from discontinued operations in 2007 of $18.0 million related to the EPDM business sold in June 2007, the optical monomers business sold in October 2007, the fluorine business sold in January 2008 and adjustments related to the sale of the OrganoSilicones business sold in July 2003. Earnings from discontinued operations in 2006 of $20.0 million related to the EPDM business, the optical monomers business and the fluorine business. Total Debt The company's total debt as of Dec. 31, 2007, was $1.06 billion as compared with $1.11 billion as of Dec. 31, 2006. Cash and cash equivalents were $77.0 million as of Dec. 31, 2007, compared to $95.0 million as of Dec. 31, 2006. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $4.41 billion in total assets, $2.56 billion in total liabilities, and $1.85 billion in total stockholders' equity. 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?2957 About Chemtura Corporation Headquartered in Middlebury, Connecticut, Chemtura Corp. (NYSE: CEM) -- http://www.chemtura.com/-- is a manufacturer and marketer of polymer additives, performance specialties, consumer products and crop protection. * * * As reported in the Troubled Company Reporter on Dec. 21, 2007, Moody's Investors Service placed Chemtura Corporation's corporate family rating of Ba2 under review for possible downgrade after reports that its "board of directors has authorized management to consider a wide range of strategic alternatives available to the company to enhance shareholder value." Standard & Poor's Ratings Services placed its 'BB+' corporate credit and senior unsecured debt ratings of Chemtura Corp. on CreditWatch with developing implications, after reports that management is considering strategic alternatives, including sale or merger of the company. CHRYSLER LLC: Agrees to Extend Supply Agreement to April 2 ---------------------------------------------------------- Plastech Engineered Products Inc. and its debtor-affiliates have reached a new interim supply agreement with Chrysler LLC. Pursuant to the deal, the Debtors will continue making parts for Chrysler at least through April 2, 2008, as their prior agreement ended March 17, according to The Associated Press and Erie Times. Pursuant to the initial interim agreement between the parties: -- Plastech will continue to deliver component parts to Chrysler; -- Chrysler is obligated to make certain payments to Plastech in conjunction with the continued production of component parts; and -- The Debtors are to allow BBK, as agents for Chrysler, to have supervised access to Plastech facilities for the purpose of inspecting and conducting an inventory of all tooling used for Chrysler production. Chrysler has appealed before the U.S. District Court for the Eastern District of Michigan, Southern Division a prior ruling by the Bankruptcy Court barring it from recovering certain equipment from Plastech's plants. Bankruptcy Court Judge Phillip Shefferly had held that while Chrysler held equity in the $180,400,000 worth of machinery that Plastech uses in its plants, the Debtor would need the machinery in order to continue its operations. The Plastech-Chrysler agreement comes as Plastech has sought another extension, to April 2, on the final hearing to consider approval of a final debtor-in-possession loan. Plastech has announced that it is negotiating the terms of a DIP loan from its major customers, under which the major customers will provide funding to Plastech until June 30 and assume Plastech's debts to Bank of America for the interim DIP financing and the prepetition loans it has provided to Plastech. About Plastech Engineered Based in Dearborn, Michigan, Plastech Engineered Products, Inc. -- http://www.plastecheng.com/-- is full-service automotive supplier of interior, exterior and underhood components. It designs and manufactures blow-molded and injection-molded plastic products primarily for the automotive industry. Plastech's products include automotive interior trim, underhood components, bumper and other exterior components, and cockpit modules. Plastech's major customers are General Motors, Ford Motor Company, and Toyota, as well as Johnson Controls, Inc. Plastech is a privately held company and is the largest family- owned company in the state of Michigan. The company is certified as a Minority Business Enterprise by the state of Michigan. Plastech maintains more than 35 manufacturing facilities in the midwestern and southern United States. The company's products are sold through an in-house sales force. The company and eight of its affiliates filed for Chapter 11 protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08- 42417). Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C., represent the Debtors in their restructuring efforts. The Debtors chose Jones Day as their special corporate and litigation counsel. Lazard Freres & Co. LLC serves as the Debtors' investment bankers, while Conway, MacKenzie & Dunleavy provide financial advisory services. The Debtors also employed Donlin, Recano & Company as their claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed in the Debtors' cases. As of Dec. 31, 2006, the company's books and records reflected assets totaling $729,000,000 and total liabilities of $695,000,000. (Plastech Bankruptcy News, Issue No. 13; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) About Chrysler LLC Based in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. CIRRUS LOGIC: To Close Caretta Operations in Shanghai, China ------------------------------------------------------------ Cirrus Logic Inc. said in a regulatory filing with the Securities and Exchange Commission dated March 14, 2008, that it it will close Caretta Integrated Circuits, a subsidiary based in Shanghai, China and acquired by the company on Dec. 29, 2006. About 30 positions will be affected by the planned closure. The company had determined that the China subsidiary is no longer aligned with the company's strategic plan. The company expects to materially complete the closure of its China operations by the end of its fourth fiscal quarter on March 29, 2008. The company anticipates that it will record a total charge of between $11 million to $13 million, which shall consist primarily of a non-cash, one-time charge of about $11 million for the assets and goodwill related to Caretta. The company also estimates that it will record approximately $1 million to $2 million for expenses related to employee severance benefits and contract termination costs. About Cirrus Logic Inc. Cirrus Logic Inc. (NASDAQ:CRUS) -- http://www.cirrus.com/-- develops high-precision, analog and mixed-signal integrated circuits for a broad range of consumer and industrial markets. Building on its diverse analog mixed-signal patent portfolio, Cirrus Logic delivers highly optimized products for consumer and commercial audio, automotive entertainment and industrial applications. The company operates from headquarters in Austin, Texas, with offices in Europe, Japan and Asia. * * * As reported in the Troubled Company Reporter on April 26, 2007, Standard & Poor's Ratings Services removed its ratings on Cirrus Logic from CreditWatch negative, and affirmed its 'B' corporate credit rating. The Rating holds to date. Outlook is Stable. CLEARPOINT BUSINESS: Two Units Ink Sale and Licensing Agreements ---------------------------------------------------------------- ClearPoint Business Resources Inc., formerly Terra Nova Acquisition Corp., provided updates with various agreements involving its subsidiaries, ClearPoint Resources Inc. and ClearPoint Workforce LLC. Asset Purchase Agreement On Feb. 28, 2008, ClearPoint Resources, a wholly owned subsidiary of ClearPoint Business, entered into an asset purchase agreement with StaffChex Inc. Under the purchase agreement, StaffChex assumed certain liabilities of CPR and acquired from CPR all of the customer account property, as defined in the purchase agreement, related to the temporary staffing services serviced by: (i) KOR Capital LLC pursuant to the franchise agreement -- management agreement, dated Aug. 30, 2007, and (ii) StaffChex Servicing LLC, an affiliate of StaffChex, pursuant to the exclusive supplier agreement, dated Sept. 2, 2007. That agreement with StaffChex Servicing was terminated on Feb. 28, 2008. In consideration for the customer account property acquired from CPR, StaffChex issued to CPR 15,444 shares of common stock of StaffChex and is obligated to issue up to 23,166 shares of StaffChex' common stock, subject to the earnout provisions set forth in the Purchase Agreement. Licensing Agreement On Feb. 28, 2008, CPR and its subsidiary, ClearPoint Workforce LLC, entered into the licensing agreement, with Optos Capital LLC, of which Christopher Ferguson is a sole member. Pursuant to the voting agreement, dated as of Feb. 12, 2007, Mr. Ferguson is an indirect beneficial owner, as a sole member of Optos, of more than 50% of issued and outstanding shares of the company's common stock. Pursuant to the licensing agreement, ClearPoint: (i) granted to Optos a non-exclusive license to use the ClearPoint Property and the Program, both as defined in the license agreement, which include certain intellectual property of CPR, and (ii) licensed and subcontracted to Optos the client list previously serviced by TZG Enterprises LLC, pursuant to the franchise agreement -- management agreement, dated Aug. 13, 2007, as amended, and all contracts and contract rights for the clients included on such list. In consideration of the licensing of the program, which is part of the ClearPoint Property, CPR is entitled to receive a fee equal to 5.2% of total cash receipts of Optos related to temporary staffing services. With CPR's consent, Optos granted, as additional security under certain of its credit agreements, conditional assignment of Optos' interest in the licensing agreement to its lender under such credit agreements. The agreement with TZG Enterprises was terminated on Feb. 28, 2008. Agreement with Optos On Feb. 28, 2008, ClearPoint Workforce advanced $800,000, on behalf of Optos, to the provider of its outsourced employee leasing program. The advanced funds were utilized for Optos' payroll. In consideration of making the advance on its behalf, Optos assumed the promissory notes, and the underlying payment obligations, issued by CPR on Feb. 22, 2008, which were payable to Michael Traina and Chris Ferguson in the aggregate amount of $800,000. Going Concern Doubt As reported in the Troubled Company Reporter on Feb. 28, 2007, BDO Seidman, LLP, in New York City, raised substantial doubt about the ability of Clearpoint Business Resources, Inc., fka Terra Nova Acquisition Corp., to continue as a going concern after auditing the company's consolidated annual financial statements from its inception in July 21, 2004, through the year ended Dec. 31, 2006. According to the auditor, the company is required to consummate a business combination by April 22, 2007. The company has not filed its annual report for the year 2007. The company earned net income of $235,552 on zero revenues for the year ended Dec. 31, 2006, compared to $245,602 on zero revenues at 2005. At Dec. 31, 2006, the company's balance sheet showed $30,548,951 in total assets and $6,581,094 in total liabilities, resulting in a $23,967,857 stockholders' equity, compared to total assets of $29,951,090, total liabilities of $5,983,803, and a stockholders' equity of $23,967,287. About Clearpoint Business Based in Toronto, Ontario, ClearPoint Business Resources Inc., formerly Terra Nova Acquisition Corp., is a blank check company formed on July 21, 2004 to effect a merger, capital stock exchange, asset acquisition or other similar business combination with an operating business. The company's efforts in identifying a target business have not been limited to a particular industry, although it has concentrated on businesses with high-quality management teams and which are not likely to be subject to significant low cost competition or rapid technological change. CLEARPOINT BUSINESS: Christopher Ferguson Resigns as President -------------------------------------------------------------- Christopher Ferguson, director, president and secretary of ClearPoint Business Resources Inc., formerly Terra Nova Acquisition Corp., resigned effective Feb. 28, 2008, in connection with a license agreement between ClearPoint Resources LLC and its subsidiary, ClearPoint Workforce LLC. That licensing agreement was terminated on Feb. 28, 2008. A separate story on the licensing agreement is published in today's TCR. In connection with Mr. Ferguson's resignation, the company and Mr. Ferguson entered into a separation of employment agreement and general release. Under the separation agreement, Mr. Ferguson is entitled to be reimbursed for any payments pursuant to the Consolidated Omnibus Budget Reconciliation Act for Mr. Ferguson for a period equal to 52 weeks. COBRA is a Federal law that provides a temporary offering of a company's group health coverage to eligible employees, their spouses and dependents after a job loss, reduction in work hours, death, divorce or other life event. Eligible participants can continue to receive the same benefits that they had prior to their qualifying event. Under COBRA, the participant is responsible for paying the entire premium up to 102% of the cost of the plan. Pursuant to the separation agreement, except for the parties' continuing obligations under the employment agreement between the company and Mr. Ferguson, dated as of Feb. 12, 2007, the employment agreement is of no further force and effect. Under the separation agreement, Mr. Ferguson agreed not to be a designee under the voting agreement and not to stand for election as a director of the company, and, for as long as Mr. Ferguson beneficially owns at least 5% of the company's outstanding shares of common stock, Mr. Ferguson will be entitled to be an observer at each meeting of the company's board of directors. The company will enter into a consulting agreement with Mr. Ferguson pursuant to which he will be paid $25,000 per month for 12 months. In return, Mr. Ferguson will assist the company with matters relating to the performance of his former duties and will work with the company to effectively transition his current responsibilities. The separation agreement also includes various representations, covenants and other provisions customary for an agreement of this nature. Going Concern Doubt As reported in the Troubled Company Reporter on Feb. 28, 2007, BDO Seidman, LLP, in New York City, raised substantial doubt about the ability of Clearpoint Business Resources, Inc., fka Terra Nova Acquisition Corp., to continue as a going concern after auditing the company's consolidated annual financial statements from its inception in July 21, 2004, through the year ended Dec. 31, 2006. According to the auditor, the company is required to consummate a business combination by April 22, 2007. The company has not filed its annual report for the year 2007. The company earned a net income of $235,552 on zero revenues for the year ended Dec. 31, 2006, compared to $245,602 on zero revenues at 2005. At Dec. 31, 2006, the company's balance sheet showed $30,548,951 in total assets and $6,581,094 in total liabilities, resulting in a $23,967,857 stockholders' equity, compared to total assets of $29,951,090, total liabilities of $5,983,803, and a stockholders' equity of $23,967,287. About Clearpoint Business Based in Toronto, Ontario, ClearPoint Business Resources Inc., formerly Terra Nova Acquisition Corp., is a blank check company formed on July 21, 2004 to effect a merger, capital stock exchange, asset acquisition or other similar business combination with an operating business. The company's efforts in identifying a target business have not been limited to a particular industry, although it has concentrated on businesses with high-quality management teams and which are not likely to be subject to significant low cost competition or rapid technological change. COMM 2006-FL12: Five Cert. Classes Get S&P's Rating Cuts to Low-Bs ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its rating on one class of commercial mortgage pass-through certificates from COMM 2006- FL12. At the same time, S&P lowered its rating on one class and affirmed its ratings on 16 other classes from this transaction. Concurrently, S&P raised its ratings on eight nonpooled certificates, lowered its ratings on seven nonpooled certificates, and affirmed its ratings on 16 nonpooled certificates. The upgrades and affirmations of the ratings on the pooled certificates reflect increased credit enhancement levels resulting from loan payoffs, as well as S&P's analysis of the credit characteristics of the remaining loans in the pool. The downgrade of class J reflects the operating performance of the MSREF Hotel Portfolio loan, the Legacy SoCal Portfolio loan, and the Avenue at Tower City loans, which are discussed in detail below. The revised ratings on the raked certificate classes reflect S&P's analysis of the credit characteristics of the loans, which are the sole source of cash flow for the respective certificates. As of March 17, 2008, the trust collateral balance had paid down to $1.873 billion, from $2.570 billion at issuance. The trust collateral consists of 16 floating-rate loans. The composition of the loans includes one whole loan; 12 senior interests in loans, with the junior interests supporting raked certificate classes, eight of which have related mezzanine debt held outside the trust; and three pari passu interests in whole loans, with junior interest supporting raked certificates, two of which have related mezzanine debt held outside the trust. The four largest assets in the pool constitute 67% of the outstanding pool balance. Details of these loans are: -- The Kerzner International Portfolio loan is the largest remaining loan in the pool, with a trust balance of $548.3 million and a whole-loan balance of $2.778 billion. The interest-only loan is split into two pari passu notes. The other note was included in Credit Suisse First Boston Mortgage Securities Corp.'s series 2006-TFL2. The loan is collateralized by the fee interest in two full-service resort hotels, 76 acres of vacant land, four single-family homes, a 600-suite "condotel" development (a hotel that contains condominium units), two golf courses, and the assignment of the borrower's 50% joint venture interest in 244 timeshare units, a full-service resort hotel in Los Cabos, Mexico, an 88-unit condo development, and a 495-unit condotel development. All of the collateral is located on Paradise Island in the Bahamas, with the exception of the previously referenced resort in Mexico. As of October 2007, the year- to-date revenue per available room for the two hotels was $243.53 and $797.94, which is comparable to Standard & Poor's expectation at issuance. The loan is scheduled to mature on Sept. 9, 2008, and has three 12-month extension options remaining. -- The Hotel Del Coronado is the second-largest remaining loan in the pool, with a trust balance of $255.0 million and a whole-loan balance of $260.0 million. The interest-only loan is split into two pari passu notes. In addition, there is a $350.0 million mezzanine loan and a $20 million revolving loan, which are both secured by the equity interests of the borrower. The loan is secured by the fee interest in a 679- room full-service resort hotel in Coronado Island, California. As of September 2007, the trailing-12-month RevPAR for the hotel was $248.63, which is comparable to Standard & Poor's expectation at issuance. The loan is scheduled to mature on Jan. 9, 2009, and has two 12-month extension options remaining. -- The Independence Plaza is the third-largest remaining loan in the pool, with a trust balance of $236.0 million and a whole- loan balance of $425.0 million. In addition, there is a $150.0 million mezzanine loan secured by the equity interests of the borrower. The loan is secured by the fee interest in the Independence Plaza complex in Manhattan. The property consists of three 39-story multifamily towers totaling 1,332 units, 18,000 sq. ft. of school space, 51,840 sq. ft. of retail space, and 550 parking spaces. The borrowers are upgrading units that are occupied by Section 8 tenants as they become vacant and reletting them at market rates. As of September 2007, the borrower reported a net operating income from the property of $17.50 million, which is comparable to Standard & Poor's expectation at issuance. -- The fourth-largest loan in the pool, CarrAmerica - Pool 3 National portfolio, has a whole-loan balance of $694.4 million consisting of a $491.8 million senior participation that is split into three pari passu pieces and a $202.6 million junior participation that is held outside the trust. The senior participation is further divided into two portions: a senior pooled component totaling $434.1 million and a subordinate nonpooled component with a balance of $57.7 million. The trust's portion of the pooled balance is $235.7 million (12%), and its portion of the nonpooled balance is $22.5 million, which is raked to the CN1, CN2, and CN3 certificates. In addition, the borrower's equity interests in the properties secure a $217.9 million mezzanine loan. The trust balance reflects $431.1 million in paydowns since issuance due to collateral releases. The remaining collateral securing the largest loan includes fee or leasehold interests in a portfolio of 23 suburban office properties and a pledge of refinance and sale proceeds on 14 joint venture or wholly owned office properties in various locations. The master servicer reported a debt service coverage of 2.34x for the nine months ended Sept. 30, 2007, and 85% occupancy for the year ended Dec. 31, 2007. Standard & Poor's adjusted net cash flow for the remaining properties has increased 8% since issuance. The upgrade of the CN1 certificate reflects the increase in operating performance. The loan matures in August 2008 and has three one- year extension options remaining. The MSREF Hotel Portfolio, the Legacy SoCal Portfolio, and the Avenue at Tower City loans collectively have a pooled balance of $138.0 million (7%) and a whole-loan balance of $166.5 million. Standard & Poor's adjusted NCF for the three loans is down an average 13% from its level at issuance. The downgraded MSH, LS, and TC raked certificates reflect the decline in operating performance. The Four Seasons Hualalai, Legacy Bayside Business Park, Blackstone or CarrAmerica CAR Portfolio, and the Algonquin Hotel loans have a pooled balance of $231.5 million (12%) and a whole- loan balance of $728.4 million. Standard & Poor's adjusted NCF for the Legacy Bayside Business Park and Algonquin Hotel loans is up an average 18% from its level at issuance. The upgraded raked certificates of the AH series reflect the increase in operating performance. The Four Seasons Hualalai and Blackstone or CarrAmerica CAR Portfolio loans have benefited from collateral releases and stable operating performance, which are reflected in the upgrades of the FSH and CA2 certificate. Standard & Poor's analysis included a reevaluation of the properties securing each loan in the pool. The resulting valuations support the raised, lowered, and affirmed ratings. Ratings Lowered COMM 2006-FL12 Commercial mortgage pass-through certificates Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ J BBB A- N/A MSH1 BBB- BBB+ N/A MSH2 BB+ BBB N/A MSH3 BB BBB- N/A MSH4 B+ BB+ N/A LS1 BBB- BBB N/A LS2 BB+ BBB- N/A TC1 BB BBB- N/A Ratings Raised COMM 2006-FL12 Commercial mortgage pass-through certificates Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ B AAA AA+ 20.13% CN1 A- BBB- N/A FSH1 BBB+ BBB N/A FSH2 BBB BBB- N/A CA2 BBB BBB- N/A AH1 A BBB N/A AH2 A- BBB- N/A AH3 BBB+ BBB- N/A AH4 BBB- BB+ N/A Ratings Affirmed COMM 2006-FL12 Commercial mortgage pass-through certificates Class Rating Credit enhancement ----- ------ ------------------ A-2 AAA 52.35% A-J AAA 25.27% C AA+ 16.51% D AA 12.53% E AA 9.56% F AA- 6.60% G A+ 3.77% H A 2.01% KR1 BBB+ N/A KR2 BBB N/A KR3 BBB- N/A HDC1 BBB N/A IP1 BBB+ N/A IP2 BBB- N/A IP3 BBB- N/A FSH3 BBB- N/A AN1 A+ N/A AN2 A N/A AN3 BBB N/A AN4 BBB- N/A ES1 BBB- N/A ES2 BBB- N/A CM1 A- N/A CM2 BBB- N/A X-1 AAA N/A X-2 AAA N/A X-4 AAA N/A X-3-BC AAA N/A X-3-DB AAA N/A X-3-SG AAA N/A X-5-BC AAA N/A X-5-DB AAA N/A N/A -- Not applicable. COMMERCIAL VEHICLE: Moody's Downgrades Corp. Family Rating to 'B1' ------------------------------------------------------------------ Moody's Investors Service downgraded the corporate family rating of Commercial Vehicle Group to B1 from Ba3 and changed the rating outlook to stable from negative. As per Moody's Loss Given Default Methodology, the $150 million senior unsecured note rating was lowered to B2 (LGD 4; 65%) from B1 (LGD 4; 67%) with the probability of default rating lowered to B1 from Ba3. The SGL-3 rating was affirmed. The downgrade reflects the sharp deterioration in CVGI's credit metrics as the result of a longer and more pronounced trough for commercial vehicle production than previously anticipated. Moody's believes that CVGI is likely to be limited in its ability to produce meaningful free cash flow sufficient to reduce leverage and bring other metrics to levels in line with expectations for the previous rating (which had included an expectation for through-the-cycle adjusted Debt EBITDA fluctuating comfortably within the 2.0-4.0x range). Moreover, the downgrade considers that to remain in compliance with the terms of its senior secured revolving credit facility, CVGI has had to amend the financial covenants twice in the past six months, and, as part of the process, the facility size was reduced to $50 million from $100 million. The stable outlook incorporates expectations that Class 8 production rates (which account for the largest share of CVGI revenues) are at or near a trough, and that CVGI's credit metrics should gradually improve as build rates become healthier in advance of 2010 emission standards. However, Moody's notes that, if production rates do not rise in line with industry expectations and CVGI's metrics remain at current levels, the outlook or ratings could face pressure. Specifically, the ratings could be stressed if adjusted debt EBITDA were to remain above 5x for the foreseeable future, if free cash flow were to be materially negative, or if CVGI struggles to comply with its amended financial covenants under its recently reduced $50 million senior secured revolving credit facility. Commercial Vehicle Group, Inc., headquartered in New Albany, Ohio, is a provider of customized products for the commercial vehicle market, including the heavy-duty truck, construction, agricultural, specialty and military transportation markets. The company is an amalgamation of several predecessor organizations whose products include cab structures & assembly, seats & seating systems, trim systems & components, wire harnesses, wipers, controls and mirrors. Revenues in 2007 were $697 million. CONSUMERS ENERGY: Issues $250 M. 5.65% 1st Mortgage Bonds due 2018 ------------------------------------------------------------------ Consumers Energy Company said in a regulatory filing with the Securities and Exchange Commission that on March 14, 2008, the company issued and sold $250,000,000 principal amount of its 5.65% First Mortgage Bonds due 2018. Consumers Energy will use the proceeds for general corporate purposes. The $250,000,000 aggregate principal amount of its 5.65% First Mortgage Bonds due 2018 was issued under the Indenture dated as of Sept. 1, 1945, as amended, between the company and The Bank of New York, as Trustee, including the 108th Supplemental Indenture dated as of March 14, 2008, relating to the Bonds. A full-text copy of the final term sheet is available for free at: http://researcharchives.com/t/s?2930 A full-text copy of the prospectus supplement to prospectus dated Dec. 1, 2004, is available for free at: http://researcharchives.com/t/s?2932 About Consumers Energy Headquartered in Jackson, Michigan Company, the principal subsidiary of CMS Energy Corp. (NYSE: CMS) -- http://www.cmsenergy.com/-- provides natural gas and electricity to nearly 6.5 million of Michigan's 10 million residents in all 68 Lower Peninsula counties. * * * Moody's Investor Service placed CMS Energy's senior unsecured debt rating at 'Ba1' in June 2007. The rating still holds to date with a stable outlook. CONTINENTAL AIRLINES: Teamsters Criticizes AMFA Over Mechanic Jobs ------------------------------------------------------------------ The Teamsters Union said that the Aircraft Mechanics Fraternal Association failed to protect mechanics' jobs at United Airlines Inc., Northwest Airlines Corp. and Alaska Airlines Inc. AMFA also misrepresented conditions at Teamster airlines. Continental Airlines Inc. outsourced jobs before the Teamsters were elected to represent mechanics at that airline. The number of mechanics at Continental increased to 3,605 last year from 3,050 in 1998, when the Teamsters became the mechanics' representative. Continental's furlough list has been exhausted and new mechanics have been hired. In contrast, 3,289 mechanics and related lost their jobs at United between 2003 and 2006 while they were represented by AMFA. United has cut more maintenance workers than any other U.S. airline. Additionally, thousands of mechanics lost their jobs at other AMFA-represented carriers, including Alaska and Northwest airlines. "Anyone who's seen what happened at United, or watched mechanics marched off the cliff at Northwest Airlines, understands that AMFA has to resort to lies to hang on to the members it has left," said Teamsters General President Jim Hoffa. Despite AMFA claims, there has been no job loss at Teamster- represented carriers. United Airline mechanics are in the midst of voting to switch representation to the Teamsters from AMFA. The voting period ends March 31. Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico. There are 40,000 Teamsters airline employees, including more than 9,000 mechanics and related at 11 airlines. About Alaska Airlines Headquartered in Seattle, Washington, Alaska Airlines Inc. -- http://alaskaair.com/-- is a wholly owned subsidiary of Alaska Air Group Inc. (NYSE: ALK). Air Group is also the parent company of Horizon Air Industries Inc. and Alaska Air Group Leasing. Alaska Airlines and Horizon Air together serve 92 cities through an expansive network in Alaska, the Lower 48, Hawaii, Canada and Mexico. About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents, including Italy, Spain, Japan, China, Venezuela and Argentina. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. (Northwest Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). 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. COOPER COMPANIES: Moody's Holds Ba3 Ratings With Negative Outlook ----------------------------------------------------------------- Moody's Investors Service downgraded Cooper Companies, Inc.'s speculative liquidity rating to SGL-3 from SGL-2. Concurrently, Moody's affirmed the company's Ba3 corporate family rating, Ba3 probability of default rating and Ba3 rating on the $350 million Senior Unsecured Notes due 2015. The ratings outlook remains negative The downgrade of the company's liquidity rating to SGL-3 from SGL-2 recognizes Moody's expectations that there is a high probability that the company will have to repurchase the $115 million convertible securities due 2023 that are puttable in July 2008. Currently, the company's stock price is below the conversion price ($44.40) stated in the convertible securities' indenture. Moody's anticipates that Cooper will fund the repurchase of the debt with borrowings under the existing revolver. Additionally, the company's capital expenditures will remain elevated through Oct. 31, 2008. As a result, Moody's expects the company will generate negative free cash flow through the twelve months ending April 30, 2009. Moody's does note that the company will have adequate cushion under its financial covenants through the four quarter period ending April 30, 2009. Sidney Matti, Analyst, stated that, "Cooper will continue to have capital spending requirements related to the startup of the manufacturing of the Avaira two week silicone hydrogel contact lens product and the capacity expansion of daily contact lens products coupled with the repayment of the convertible notes which will result in negative free cash flow over the near term." The negative outlook reflects the continued negative free cash flow related to additional capital spending related to new product introductions coupled with Moody's expectation that the company will have to repurchase the convertible notes in July 2008. Consequently, the company has not focused on repaying its outstanding debt and will have a higher than expected debt position over the ratings horizon. Moody's does note the company's moderate leverage position as it relates to adjusted debt to EBITDA and the revenue growth related to the single daily lens products. This rating was downgraded: -- Speculative Grade Liquidity Rating to SGL-3 from SGL-2. These ratings were affirmed: -- Corporate Family Rating at Ba3; -- Probability of Default Rating at Ba3; and -- Ba3 rating (LGD3/45%) on Senior Unsecured Notes due 2015. Headquartered in Pleasanton, California, The Cooper Companies, Inc., through its principal business units, develops, manufactures and markets healthcare products. CooperVision develops, manufactures and markets a broad range of contact lenses for the worldwide vision correction market. CooperSurgical develops, manufactures and markets medical devices, diagnostic products and surgical instruments and accessories used primarily by gynecologists and obstetricians. For the twelve months ended Jan. 31, 2008, the company reported approximately $976 million in revenues. CREDIT SUISSE: Six 2008-C1 Certs. Get S&P's Low-B Initial Ratings ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to Credit Suisse Commercial Mortgage Trust Series 2008- C1's $887.2 million commercial mortgage pass-through certificates series 2008-C1. The preliminary ratings are based on information as of March 19, 2008. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect credit support provided by the subordinate classes of certificates, the liquidity provided by the trustee, the economics of the underlying loans, and the geographic and property type diversity of the loans. Classes A-1, A-2, A-AB, A-3, and A-1-A are currently being offered publicly. Standard & Poor's analysis determined that, on a weighted average basis, the collateral pool has a debt service coverage of 1.24x, a beginning loan-to-value ratio of 102.4%, and an ending LTV of 96.9%. Preliminary Ratings Assigned Credit Suisse Commercial Mortgage Trust Series 2008-C1 Recommended Class Rating Amount credit support ----- ------ ------ -------------- A-1 AAA $12,500,000 30.00% A-2 AAA $229,000,000 30.00% A-AB AAA $22,262,000 30.00% A-3 AAA $258,000,000 30.00% A-1-A AAA $99,282,000 30.00% A-M AAA $88,721,000 20.00% A-J AAA $57,668,000 13.50% B AA+ $8,872,000 12.50% C AA $8,872,000 11.50% D AA- $12,199,000 10.13% E A+ $9,982,000 9.00% F A $6,654,000 8.25% G A- $8,872,000 7.25% H BBB+ $14,417,000 5.63% J BBB $6,654,000 4.88% K BBB- $9,981,000 3.75% L BB+ $3,327,000 3.38% M BB $3,327,000 3.00% N BB- $3,327,000 2.63% O B+ $1,109,000 2.50% P B $2,218,000 2.25% Q B- $2,218,000 2.00% S NR $17,744,600 0.00% A-X* AAA $887,206,600 N/A * Interest-only class with a notional amount. NR -- Not rated. N/A -- Not available. DEERFIELD CAPITAL: Completes Sale of RMBS and Rate Swaps Reduction ------------------------------------------------------------------ Deerfield Capital Corp. completed these transactions between Feb. 15, 2008 and March 10, 2008: (i) sold agency residential mortgage backed securities or RMBS with an amortized cost of $1.8 billion; (ii) sold AAA-rated non-agency RMBS with an amortized cost of $103.2 million; and (iii) reduced the net notional amount of interest rate swaps used to hedge the RMBS portfolio by approximately $2.0 billion. The company relates that these measures were executed to increase liquidity, reduce risk associated with its RMBS, portfolio and focus its growth on its asset management business. The net losses realized on these transactions were approximately $61.3 million. The company increased its liquidity as a result of these sales, and its management relates that it has adequate liquidity to support its business activities, including the remaining RMBS portfolio and associated interest rate hedges. The company is in compliance with the material terms of its repurchase agreements. However, recent sales have the potential to impact both its ability to qualify as a real estate investment trust, or REIT, and to maintain the exemption from registration under the Investment Company Act of 1940, as amended. To qualify as a REIT, at the end of each calendar quarter, at least 75% of the value of total assets must consist of qualifying assets, including real estate assets, cash and cash items, including receivables and government securities. As a result of the sales of substantially all of the AAA-rated non-agency RMBS and a large portion of the agency RMBS, the company may not be in compliance with this test at the end of the quarter. To remain qualified as a REIT, the company will need to acquire additional qualifying assets or dispose of a significant portion of its nonqualifying assets by March 31, 2008, or within 30 days thereafter. If the company fails to qualify as a REIT for the 2008 taxable year, it would be subject to regular corporate income tax. In addition, the company would be prevented from qualifying as a REIT until its 2013 taxable year. The company is pursuing strategies to maintain its REIT qualification although there is no assurance the company will be successful in this regard, and it may explore alternative corporate structures in order to maximize value for the company's shareholders. The company said it operates its business in such a way as to avoid regulation under the 1940 Act. Historically, the company has done so by ensuring that 55% of the assets of Deerfield Capital LLC, or DC LLC, are mortgage loans and other qualifying assets. As a result of the transactions, DC LLC no longer complies with this test. Accordingly, the company and DC LLC rely on a safe harbor exemption for companies that have a bona fide intent to be engaged in an excepted activity but that temporarily fail to meet the requirements of their exemption from registration as an investment company. If the company is unable to restore its assets to compliance with its usual tests within a one-year period, it may be required either to register as an investment company or to acquire or dispose of assets in order to meet the long-term exemption. About Deerfield Capital Corp. Headquartered in Rosemont, Illinois, Deerfield Capital Corp. (NYSE:DFR) -- http://www.deerfieldcapital.com/-- fka Deerfield Triarc Capital Corp., is a diversified financial company that invests in real estate investments, mortgage-backed securities, well as corporate investments. Deerfield Capital Management LLC manages the company and its investment portfolio. * * * Moody's Investor Service placed Deerfield Capital Corp.'s long term corporate family rating at 'Ba3' in November 2007. The rating still holds to date with a negative outlook. DEERFIELD CAPITAL: Extends Waivers with Noteholders to March 2009 ----------------------------------------------------------------- Deerfield Capital Corp. entered into waivers with the holders of its Series A Senior Secured Notes and Series B Senior Secured Notes. The waivers extend through March 31, 2009. The waivers stays compliance with certain portions of a real estate investment trust or REIT qualification covenant contained in the note purchase agreements relating to the notes. Pursuant to the waivers, the company has agreed to use reasonable efforts to meet the requirements to qualify as a REIT during the Waiver Period. Headquartered in Rosemont, Illinois, Deerfield Capital Corp. (NYSE:DFR) -- http://www.deerfieldcapital.com/-- fka Deerfield Triarc Capital Corp., is a diversified financial company that invests in real estate investments, mortgage-backed securities, well as corporate investments. Deerfield Capital Management LLC manages the company and its investment portfolio. * * * Moody's Investor Service placed Deerfield Capital Corp.'s long term corporate family rating at 'Ba3' in November 2007. The rating still holds to date with a negative outlook. DEERFIELD CAPITAL: Gregory Sachs Resigns from Board of Directors ---------------------------------------------------------------- Gregory H. Sachs resigned from his position as a member of Deerfield Capital Corp.'s board of directors to pursue other business interests. The company has six directors on its board of directors. Headquartered in Rosemont, Illinois, Deerfield Capital Corp. (NYSE:DFR) -- http://www.deerfieldcapital.com/-- fka Deerfield Triarc Capital Corp., is a diversified financial company that invests in real estate investments, mortgage-backed securities, well as corporate investments. Deerfield Capital Management LLC manages the company and its investment portfolio. * * * Moody's Investor Service placed Deerfield Capital Corp.'s long term corporate family rating at 'Ba3' in November 2007. The rating still holds to date with a negative outlook. DEUTSCHE BANK: Moody's Cuts 164 Tranches' Ratings on Delinquencies ------------------------------------------------------------------ Moody's Investors Service downgraded the ratings of 164 tranches from 21 Alt-A transactions issued by Deutsche Bank. Eighty seven downgraded tranches remain on review for possible further downgrade. Additionally, 113 tranches were placed on review for possible downgrade. The collateral backing these transactions consists primarily of first-lien, fixed and adjustable-rate, Alt-A mortgage loans. The ratings were downgraded, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. The actions described below are a result of Moody's on-going review process. Complete rating actions are: Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2005-5 -- Cl. M-1, Downgraded to Aa2 from Aa1 -- Cl. M-2, Downgraded to A1 from Aa2 -- Cl. M-3, Downgraded to A3 from Aa3 -- Cl. M-4, Downgraded to Ba1 from A2 -- Cl. M-5, Downgraded to Ba3 from A3 -- Cl. M-6, Downgraded to B2 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. B-1, Downgraded to Ca from Ba1 -- Cl. B-2, Downgraded to Ca from B1 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2005-6 -- Cl. I-A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-8, Placed on Review for Possible Downgrade, currently Aa1 -- Cl. I-A-PO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-4, Placed on Review for Possible Downgrade, currently Aa1 -- Cl. II-A-PO, Placed on Review for Possible Downgrade, currently Aaa Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2005-AR1 -- Cl. M, Downgraded to Baa3 from Aa2 -- Cl. B-1, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. B-2, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. B-3, Downgraded to Ca from Ba2 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2005-AR2 -- Cl. M, Downgraded to A3 from Aa3 -- Cl. B-1, Downgraded to B1 from A3 -- Cl. B-2, Downgraded to B2 from Baa2; Placed Under Review for further Possible Downgrade Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2006-AF1 -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Baa1 from Aa1 -- Cl. M-2, Downgraded to Ba3 from Aa2 -- Cl. M-3, Downgraded to B2 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A1; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from Ba1 -- Cl. M-8, Downgraded to Ca from Ba2 -- Cl. M-9, Downgraded to Ca from B1 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2006-AR1 -- Cl. I-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to Ba1 from Aa1 -- Cl. I-M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-4, Downgraded to B3 from A1; Placed Under Review for further Possible Downgrade -- Cl. I-M-5, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. I-M-6, Downgraded to Caa1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. I-M-7, Downgraded to Ca from Ba1 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2006-AR2 -- Cl. A-1-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba3 from Aa1 -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from Ba3 -- Cl. M-8, Downgraded to Ca from B2 -- Cl. M-9, Downgraded to Ca from Caa3 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2006-AR3 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Ca from Ba1 -- Cl. M-6, Downgraded to Ca from Ba2 -- Cl. M-7, Downgraded to Ca from B1 -- Cl. M-8, Downgraded to Ca from Caa1 Issuer: Deutsche Alt-A Securities Mortgage Loan Trust, Series 2006-AR4 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from B2 -- Cl. M-8, Downgraded to Ca from Caa3 Issuer: Deutsche Alt-A Securities Mortgage Loan Trust, Series 2006-AR5 -- Cl. I-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-3A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-PO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-X1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to B3 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-4, Downgraded to Caa1 from A3; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to Caa1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-5, Downgraded to Caa1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. I-M-6, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-7, Downgraded to Ca from Ba1 -- Cl. I-M-8, Downgraded to Ca from Ba2 -- Cl. I-M-9, Downgraded to Ca from B1 -- Cl. I-M-10, Downgraded to Ca from Caa1 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2006-AR6 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-8, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from Ba1 -- Cl. M-8, Downgraded to Ca from Ba2 -- Cl. M-9, Downgraded to Ca from B1 -- Cl. M-10, Downgraded to Ca from Caa1 Issuer: Deutsche Alt-B Securities Mortgage Loan Trust, Series 2006-AB1 -- Cl. A-1-C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2-C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2-D, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-X, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-X-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba1 from Aa3 -- Cl. M-2, Downgraded to B2 from A1 -- Cl. M-3, Downgraded to B2 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Ca from Ba1 Issuer: Deutsche Alt-B Securities, Inc. Mortgage Loan Trust Series 2006-AB2 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-8, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba1 from Aa1 -- Cl. M-2, Downgraded to B2 from Aa2 -- Cl. M-3, Downgraded to B2 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from Ba1 -- Cl. M-8, Downgraded to Ca from B1 Issuer: Deutsche Alt-B Securities, Inc. Mortgage Loan Trust Series 2006-AB3 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-8, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba3 from Aa1 -- Cl. M-2, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A1; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-8, Downgraded to Ca from Ba1 -- Cl. M-9, Downgraded to Ca from Ba3 -- Cl. M-10, Downgraded to Ca from B3 Issuer: Deutsche Alt-B Securities Mortgage Loan Trust, Series 2006-AB4 -- Cl. A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1B-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-8, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-9, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-10, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-11, Downgraded to Ca from Ba1 -- Cl. M-12, Downgraded to Ca from Ba2 -- Cl. M-13, Downgraded to Ca from Ba3 -- Cl. M-14, Downgraded to Ca from B2 Issuer: Deutsche Alt-A Securities Mortgage Loan Trust, Series 2007-1 -- Cl. I-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-4A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-4B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B1 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B2 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to Ca from Ba2 -- Cl. M-7, Downgraded to Ca from Ba3 -- Cl. M-8, Downgraded to Ca from B1 -- Cl. M-9, Downgraded to Ca from Caa1 -- Cl. M-10, Downgraded to Ca from Caa2 Issuer: Deutsche Alt-A Securities Mortgage Loan Trust, Series 2007-2 -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to A1 from Aa1 -- Cl. M-2, Downgraded to Baa1 from Aa2 -- Cl. M-3, Downgraded to Baa2 from Aa3 -- Cl. M-4, Downgraded to Ba1 from A1 -- Cl. M-5, Downgraded to Ba3 from A2 -- Cl. M-6, Downgraded to B1 from A3 -- Cl. M-7, Downgraded to B1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-8, Downgraded to B1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-9, Downgraded to B1 from Baa3; Placed Under Review for further Possible Downgrade Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2007-AR1 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3C, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Ca from Ba1 -- Cl. M-6, Downgraded to Ca from Ba2 -- Cl. M-7, Downgraded to Ca from B1 -- Cl. M-8, Downgraded to Ca from B3 Issuer: Deutsche Alt-A Securities Mortgage Loan Trust, Series 2007-AR2 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to Ca from Ba1 -- Cl. M-7, Downgraded to Ca from Ba3 -- Cl. M-8, Downgraded to Ca from B2 -- Cl. M-9, Downgraded to Ca from Caa1 Issuer: Deutsche Alt-A Securities, Inc. Mortgage Loan Trust Series 2007-AR3 -- Cl. I-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-7, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to Ca from Ba2 -- Cl. I-M-4, Downgraded to Ca from B2 -- Cl. I-M-5, Downgraded to Ca from Caa2 -- Cl. II-M-1, Downgraded to B1 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. II-M-2, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. II-M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-4, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. II-M-5, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-6, Downgraded to Ca from Ba1 -- Cl. II-M-7, Downgraded to Ca from B1 -- Cl. II-M-8, Downgraded to Ca from B3 -- Cl. II-M-9, Downgraded to Ca from Caa2 Issuer: Deutsche Alt-B Securities Mortgage Loan Trust, Series 2007-AB1 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. AI-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. AI-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. PO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. X, Placed on Review for Possible Downgrade, currently Aaa -- Cl. B-1, Downgraded to B2 from Aa1; Placed Under Review for further Possible Downgrade EDS CORP: Augments EDS Global Network with Nexagent Assets Buyout ---------------------------------------------------------------- EDS Corp. acquired the assets of Nexagent. Financial terms of the transaction were not disclosed. The transfer of assets is effective immediately. The company relates that this acquisition builds upon EDS' ongoing investment in the company's networking services capabilities and the EDS Global Services Network. The GSN connects more than 500 EDS service delivery sites to clients though a single, secure, fully redundant network. Leveraging Nexagent's technology enables EDS to automate and accelerate the design, transition and operation of enterprise service delivery and sets a standard for high availability connection of clients to the EDS Global Services Network. "With the software, resources and technology of Nexagent, EDS will reduce connection expense and provisioning time for migrating clients onto the EDS network," EDS Ray Thietten, vice president, Global Network Services, said. "Our clients rely on EDS for mission-critical functions to run their businesses. Acquiring these advanced technologies allows EDS to drive even greater operational efficiencies and improve service quality." "We are pleased to have the opportunity to join with EDS, the global IT services leader, and merge our advanced networking technologies with the EDS Global Services Network," said Royce Murphy, Nexagent's CEO. "I am confident that with the addition of Nexagent's talented workforce and intellectual capital, EDS will continue to improve its already outstanding service quality and drive even more quickly toward its 'Zero Outages' goal." Nexagent provides a Lifecycle Management System and a Multi- Carrier Interconnect System to EDS as a key underlying technology for "interconnecting" EDS carrier partners to the EDS Global Services Network. The availability, distributed network interconnects have had zero outages since their installation on the EDS Global Services Network in 2006. "By acquiring the assets of Nexagent, EDS will bolster its ability to offer a broader set of network solutions to clients and leverage this newly acquired expertise to further service existing and new clients," Wu Zhou, senior research analyst, Network Consulting and Integration Services with IDC, said. "We see this acquisition as a key, strategic move that will give EDS a competitive advantage when onboarding clients to its network." Under the terms of the acquisition, current Nexagent employees will become employees of EDS, reporting into EDS' Global Network Services organization, EMEA centre, located in Stockley Park, United Kingdom. About Nexagent Nexagent, founded in July 2000, is a developer of software tools that enable carriers, systems integrators and virtual network operators to automate and accelerate the design, provisioning and management of a client's IP VPN or Virtual Private Network. This capability is particularly valuable when the network connection spans multiple carriers and multiple regions. About EDS Corp. Based in Plano, Texas, Electronic Data System Corp. (NYSE: EDS) -- http://www.eds.com/-- is a global technology services company delivering business solutions to its clients. EDS founded the information technology outsourcing industry more than 40 years ago. EDS delivers a broad portfolio of information technology and business process outsourcing services to clients in the manufacturing, financial services, healthcare, communications, energy, transportation, and consumer and retail industries and to governments around the world. EDS' Network Services offerings reduces carrier vendor lock-in, eases transition from carrier to carrier and allows EDS to act as an impartial advisor when recommending the best provider for carrier services to clients. * * * Moody's placed EDS Corp.'s senior unsecured debt rating at 'Ba1' in July 2004, and its probability of default rating at 'Ba1' in September 2006. The outlook is positive. The ratings still hold to date. EFOODSAFETY.COM: Posts $942,334 Net Loss in 3rd Qtr. Ended Jan. 31 ------------------------------------------------------------------ eFoodSafety.com Inc. reported a net loss of $942,334 on revenues of $309,197 for the third quarter ended Jan. 31, 2008, compared with a net loss of $772,186 on revenues of $82,930 in the same period ended Jan. 31, 2007. Consulting fees paid to outside directors, legal advisors and marketing consultants were $898,717 for the three months ended Jan. 31, 2008. compared with $557,000 during the three months ended Jan. 31, 2007. Balance Sheet At Jan. 31, 2008, the company's consolidated balance sheet showed $4,342,071 in total assets, $103,243 in total liabilities, and $4,238,828 in total shareholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?2950 Going Concern Doubt Gruber & Company LLC, in Lake St. Louis, Mo., expressed substantial doubt about eFoodSafety.com Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended April 30, 2007. The auditing firm pointed to the company's recurring losses from operations. About eFoodSafety.com Inc. Headquartered in Scottsdale, Ariz., eFoodSafety.com Inc. (OTC BB: EFSF.OB) -- http://www.efoodsafety.com/ -- is a publicly traded fully-reporting company dedicated to improving health conditions around the world through its innovative technologies. The company's Knock-Out Technologies Ltd. subsidiary has developed an environmentally safe sporicidal product formulated entirely of food-grade components that eradicates anthrax and a germicidal product, Big 6 Plus that kills six major bacteria: E-coli, Listeria, Pseudomonas, Salmonella, Staphylococcus, and Streptococcus, Avian Influenza and Black Mold. The sporicidal product has completed its final efficacy laboratory study requisite for EPA registration. The company's MedElite Inc. subsidiary distributes clinically proven products to physicians who then prescribe the products for their patients. The company manufactures Cinnergen(TM), a non- prescription liquid whole food nutritional supplement that promotes healthy glucose metabolism and is the owner of PurEffect(TM), a 4-step anti-acne formula. EL PASO CORP: Earns $1.11 Billion in 12 Months Ended December 31 ---------------------------------------------------------------- El Paso Corp. reported net income of $1.11 billion, on operating revenues of $4.65 billion for the 12 months ended Dec. 31, 2007, compared with net income of $438.0 million, on operating revenues of $4.28 billion for full-year 2006. "We are delighted to report our fifth consecutive year of improved earnings," said Doug Foshee, El Paso's president and chief executive officer. "During the year, our pipeline group placed more than $500.0 million of projects into service while expanding our committed project backlog to almost $4.0 billion. Our E&P business also had a very good year, with 8.0% production growth, as well as an 18.0% increase in proved reserves and lower unit direct lifting costs. We enter 2008 with a strong balance sheet, visible multi-year growth in hand, and opportunities to add to our growth trajectory." For the fourth quarter ended Dec. 31, 2007, the company reported net income of $160.0 million, on operating revenues of $1.26 billion, compared with a net loss of $166.0 million, on operating revenues of $913.0 million for the same period of 2006. Fourth quarter 2007 results from continuing operations include a $17.0 million after-tax loss due to the change in fair value of derivatives intended to manage price risk on natural gas and oil production in the marketing segment. Results also include a $22.0 million after-tax loss related to the change in fair value of power contracts in the Pennsylvania, New Jersey, Maryland (PJM) power pool and an $8.0 million after-tax loss related to Brazilian power impairments. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $24.58 billion in total assets, $18.73 billion in total liabilities, $565.0 million in minority interests, and $5.28 billion total shareholders' equity. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $1.71 billion in total assets available to pay $2.41 billion 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?292a About El Paso Headquartered in Houston, Texas, El Paso Corporation (NYSE: EP) -- http://www.elpaso.com/-- provides natural gas and related energy products. El Paso owns North America's largest interstate natural gas pipeline system and one of North America's largest independent natural gas producers. * * * As reported in the Troubled Company Reporter on Nov. 20, 2007, Standard & Poor's Ratings Services affirmed its 'BB' corporate credit ratings on El Paso Corp. and subsidiaries. The outlook remains positive. ENTERPRISE GP: Had $947MM Working Capital Deficit at Dec. 31, 2007 ------------------------------------------------------------------ In a 10-K filing with the U.S. Securities and Exchange Commission, Enterprise GP Holdings L.P.'s balance sheet reflected total assets of $23.7 billion, total liabilities of $21.6 billion, and a stockholders' equity of $2.0 billion for the year ended Dec. 31, 2007, compared to Dec. 31, 2006, which saw total assets of $18.6 billion, total liabilities of $17.2 billion, and a stockholders' equity of $1.4 billion. The company, on Dec. 31, 2007, had total current assets of $4.0 billion available to pay total current liabilities of $4.9 billion, resulting in a working capital deficit of $947 million. For the year ended Dec. 31, 2007, Enterprise GP had a net income of $109.0 million on total revenues of $26.7 billion, compared to $133.9 million of net income on total revenues of $23.6 billion in 2006. The company reported consolidated net income for the fourth quarter of 2007 of $22 million compared to $35 million for the fourth quarter of 2006. The company says that the decrease in consolidated net income is largely attributable to an increase in interest expense from a higher average debt balance associated with the acquisition of partnership interests in Energy Transfer Equity and the amortization of associated debt issuance costs. The company will receive $78 million of total cash distributions with respect to the fourth quarter of 2007. These distributions are comprised of $41 million from Enterprise Products Partners L.P. (paid February 7), $15 million from TEPPCO Partners, L.P. (paid February 7) and $22 million from Energy Transfer Equity, L.P. (payable February 19). This represents a 56 percent increase from the $50 million in distributions received with respect to the fourth quarter of 2006. The increase was due to the acquisition of partnership interest in Energy Transfer Equity and increases in cash distributions from Enterprise Products Partners and TEPPCO. The cash distribution from Energy Transfer Equity to be received on February 19 is for a four-month period -- September 2007 to December 2007 -- due to Energy Transfer Equity's transition from a fiscal year to a calendar year basis for financial reporting and cash distribution purposes. As a result, the cash distribution that Enterprise GP Holdings will receive from Energy Transfer Equity includes an additional $5.5 million relating to the extra month. Enterprise GP also reported record distributable cash flow of $56 million for the fourth quarter of 2007. Distributable cash flow for the fourth quarter of 2007 provided 1.1 times coverage of the $0.41 per unit distribution declared by the board of the general partner of Enterprise GP Holdings with respect to the fourth quarter of 2007 that was paid on Feb. 8, 2008. This distribution rate represents a 17 percent increase from $0.35 per unit paid with respect to the fourth quarter of 2006. "We were very pleased with the record distributable cash flow generated by Enterprise GP Holdings for the fourth quarter of 2007," said Dr. Ralph S. Cunningham, president and chief executive officer of Enterprise GP Holdings. "We benefited from distribution increases from Enterprise Products and Energy Transfer Equity. Part of the distribution increase from Energy Transfer Equity was driven by an increase in general partner distributions related to an issuance of 5 million units by Energy Transfer Partners, L.P. in December 2007." "Looking ahead to 2008, each of the operating partnerships in which we own GP and LP interests has completed major growth projects or acquisitions. These include Enterprise Products' projects at Independence Hub, Meeker, Pioneer and Hobbs and TEPPCO's recent $500 million asset purchase to enter into the marine transportation of refined products and crude oil business. As these investments generate incremental cash flow and the partnerships increase their cash distributions and issue limited partner units to fund their growth, we will disproportionately benefit through the leverage we have from our ownership of general partner incentive distribution rights," stated Cunningham. About Enterprise GP Houston, Texas-based Enterprise GP Holdings L.P., (NYSE: EPE) -- http://www.enterprisegp.com/-- through its subsidiaries, develops pipeline and other midstream energy infrastructure in the continental United States and Gulf of Mexico. Its midstream energy asset network links producers of natural gas, NGLs, and crude oil from supply basins in the United States, Canada, and the Gulf of Mexico. * * * As reported in the Troubled Company Reporter on Nov. 14, 2007, Fitch Ratings assigned a 'BB' rating on Enterprise GP Holdings L.P.'s seven-year, $850 million senior secured term loan B due Nov. 8, 2014. Proceeds from the term loan B were used to permanently refinance borrowings outstanding under the company's $850 million term loan A-2 that had a maturity date in May 2008. This transaction completes the permanent financing related to EPE's acquisition of ownership interest in Energy Transfer Equity and Energy Transfer Equity's GP in May 2007. EPE's Issuer Default Rating is 'BB-' and the Rating Outlook is Stable. ENTERPRISE GP: Moody's Affirms Ba1 Rating, Revises Outlook to Neg. ------------------------------------------------------------------ Moody's Investors Service affirmed Enterprise Products Operating LLC's Baa3 senior unsecured rating and changed its rating outlook to stable from negative. EPO is the primary operating subsidiary of Enterprise Products Partners L.P. (Enterprise or EPD) and issues substantially all of Enterprise's debt. Moody's also affirmed the Ba1 Corporate Family Rating (CFR) of Enterprise GP Holdings, L.P. (EPE) and changed its rating outlook to stable from negative. EPE owns the general partner (GP) and approximately 3% of the common units of Enterprise. These actions reflect completion of several large organic expansion projects, declining capital spending, expected cash flow growth, EPE equity issuance in the third quarter 2007 and improving overall family leverage. These positive trends are tempered by the company's higher leverage currently and a continued active organic growth capex program in 2008. Since Moody's changed EPO's rating outlook to negative in May 2007, Enterprise has completed several major multi-year infrastructure expansion projects, including the Independence Hub project in the deepwater Gulf of Mexico, the Hobbs NGL fractionator in Texas, an expansion of the Mid-America Pipeline, and the Meeker natural gas processing facility in Colorado. These projects resulted in higher cash flow in the fourth quarter 2007 and Moody's expects 2008 cash flow to be significantly higher than 2007 EBITDA of $1.45 billion. Enterprise expects to continue investing in previously announced organic growth projects in 2008, including the Sherman Extension pipeline in north Texas, an expansion of the Meeker gas plant and a number of smaller projects. However, total 2008 growth capex is expected to be around $1.5 billion, down considerably from $2.6 billion of capex and investments in 2007. This high level of spending adds to Enterprise's execution risk, as well as leads to greater capital raising requirements to fund its growth. While not expected at this point, Moody's cautions that Enterprise may increase its capital spending program or develop additional as yet unidentified projects. Enterprise's substantial capex in 2007 and relatively low equity issuance resulted in its Debt/EBITDA (debt adjustments include equity content of hybrid securities) growing to 4.5x at the end of 2007, up from 4.1x at the end of 2006. Moody's expects the company's debt will continue rising during 2008, reflecting its ongoing capital spending, although leverage should decline as the year progresses and cash flow grows from recently developed projects. By the end of 2008, Debt/EBITDA should drop to around 4x, more in line with the company's long term targets. Leverage of the EPCO family of companies (includes Enterprise, EPE, TEPPCO Partners and EPCO Holdings) has improved since the negative outlook last May. Debt/EBITDA was 5.4x at the end of 2007, down from 5.9x after EPE acquired its interest in Energy Transfer Equity. This improvement primarily reflects EPE's issuance of approximately $740 million of LP units last July. Leverage should drop further in 2008 to below 5x resulting from higher cash flow at EPD and TEPPCO and debt repayment at EPCO Holdings, offset by higher debt levels at EPD and TEPPCO. Enterprise Products Operating LLC, headquartered in Houston, Texas, is the primary operating subsidiary of Enterprise Products Partners L.P. (Enterprise), a publicly-traded midstream energy master limited partnership. Enterprise's operations include natural gas gathering, processing, transportation and storage; natural gas liquids fractionation, transportation and storage; oil pipelines; offshore production platform services; and petrochemical services. EQUA-CHLOR: Seeks Permission to Hire Lane Powell as Counsel ----------------------------------------------------------- Equa-Chlor LLC will appear before the Hon. Paul B. Snyder of the U.S. Bankruptcy Court for the Western District of Washington at a hearing on April 10, 2008, to seek permission to employ Lane Powell PC as its bankruptcy counsel, effective as of its chapter 11 petition date. Lane Powell has been providing legal advice to the Debtor since 2005. Among others, the firm acted as Equa-Chlor's local counsel in connection with a prepetition financing the Debtor received from GMAC. The firm provided legal advice to Equa-Chlor related to its debt restructuring and bankruptcy filing since December 2007. As counsel, Lane Powell will: -- provide the Debtor legal advise with respect to its powers and duties as debtor-in-possession in the continued operation of its business and management of its property; -- prepare necessary filings with the Bankruptcy Court; and -- assist the Debtor in pursuing a plan of reorganization. Bruce W. Leaverton, Esq., a shareholder at the firm, disclosed that on December 4, 2007, Lane Powell received a $50,000 general retainer from Equa-Chlor for services performed and to be performed in connection with the firm's representation of the Debtor. On December 31, Lane Powell received payment from the Debtor for services rendered in November 2007, valued at $15,248. The firm performed additional services to the Debtor through January 31, 2008, valued at $157,417, for which it has not been paid. The firm also performed services between January 31 and the bankruptcy filing date that have not yet been billed. The firm will be paid according to its customary hourly rates. Mr. Leaverton charges $425 an hour. Other professionals and support personnel at the firm charge between $125 and $475 an hour. Other than its prepetition fees, the firm is not a creditor of the Debtor, Mr. Leaverton says. Mr. Leaverton also assures the Court that his firm is disinterested as the term is defined in Section 101(14) of the Bankruptcy Code. Lane Powell has no connections with the Debtor and does not hold, nor represent, any interest adverse to the estate, he says. Equa-Chlor, L.L.C., dba Equa-Chlor Marketing, L.L.C., operates a chemical manufacturing plant in Longview, Washington. Equa-Chlor filed for chapter 11 bankruptcy protection February 15, 2008, before the U.S. Bankruptcy Court for the Western District of Washington in Tacoma (Case No. 08-40599). EQUA-CHLOR: U.S. Trustee Appoints 5-Member Creditors' Panel ----------------------------------------------------------- Pursuant to 11 U.S.C. Section 1102, Robert D. Miller, Jr., Acting United States Trustee for the Western District of Washington, appointed five members to the official committee of unsecured creditors in the bankruptcy case of Equa-Chlor LLC: 1. Reef Anderson Vice President Iconco/LVI Demolition Services, Inc. 5409 Ohio Avenue S. Seattle, WA 98134-2419 Tel: (206) 763-0900 Fax: (206) 763-7422 2. Jeffrey Lippold Executive Vice President Synergen Consulting International 580 Westlake Park Blvd., Suite 110 Houston, TX 77079 Tel: (281) 598-2246 Fax: (281) 598-1199 3. Joseph Skinner President Casne Engineering, Inc. 10604 NE 38th Place, Suite 205 Kirkland, WA 98033 Tel: (425) 522-1029 Fax: (425) 828-2622 4. Kevin Van Fleet Credit and Contracts Manager JH Kelly LLC P.O. Box 2038 Longview, WA 98632 Tel: (360) 423-5510 Fax: (360) 423-9170 5. Roy Suter Senior Credit Manager Mitsubishi International Corporation Credit Department - 3rd Floor 655 Third Avenue New York, NY 10017 Tel: (212) 605-2111 Fax: (212) 605-1890 Roy Suter, Senior Credit Manager at Mitsubishi International Corporation, will act as committee chairperson. Equa-Chlor, L.L.C., dba Equa-Chlor Marketing, L.L.C., operates a chemical manufacturing plant in Longview, Washington. Equa-Chlor filed for chapter 11 bankruptcy protection February 15, 2008, before the U.S. Bankruptcy Court for the Western District of Washington in Tacoma (Case No. 08-40599). Bruce W. Leaverton, Esq., at Lane Powell, P.C., in Seattle, represents the Debtor. EQUA-CHLOR: Panel Can Hire Bush Strout as Bankruptcy Counsel ------------------------------------------------------------ The Official Committee of Unsecured Creditors in Equa-Chlor, L.L.C.'s chapter 11 case sought and obtained permission from the U.S. Bankruptcy Court for the Western District of Washington to retain Bush Strout & Kornfeld as counsel. Committee chairperson Roy Suter, a Senior Credit Manager at Mitsubishi International Corporation, said the Committee needs counsel to assist it in performing its functions pursuant to Sec. 1102 and 1103 of the Bankruptcy Code. Bush Strout will be paid on an hourly basis. Attorneys at Bush Strout charge between $300 and $450 per hour; other support personnel that may do work for the Committee charge between $55 and $90 per hour. Mr. Suter attests that Bush Strout has no connections with the Debtor and does not hold, nor represent, any interest adverse to the estate. The firm is disinterested as the term is defined in Section 101(14) of the Bankruptcy Code, Mr. Suter said. Equa-Chlor, L.L.C., dba Equa-Chlor Marketing, L.L.C., operates a chemical manufacturing plant in Longview, Washington. Equa-Chlor filed for chapter 11 bankruptcy protection February 15, 2008, before the U.S. Bankruptcy Court for the Western District of Washington in Tacoma (Case No. 08-40599). Bruce W. Leaverton, Esq., at Lane Powell, P.C., in Seattle, represents the Debtor. FERRO CORP: Had $94 Million Net Loss for Year Ended Dec. 31, 2007 ----------------------------------------------------------------- Ferro Corporation filed its financial statements for the quarter and year ended Dec. 31, 2007, in a 10-K filing with the U.S. Securities and Exchange Commission. Ferro Corp. had a net loss of $94.4 million on net sales of $2.2 billion for the year ended Dec. 31, 2007, compared to a net income of $19.3 million on net sales of $2.0 billion in 2006. Sales for the year ended Dec. 31, 2007 were a record $2.2 billion, up 8% from 2006. Sales for the fourth quarter were $570.7 million, an increase of 14.8% from the fourth quarter of 2006. Net sales increased 8% in 2007 primarily as a result of product price increases and favorable changes in foreign currency exchange rates. Compared with 2006, sales increased in the Performance Coatings, Color and Glass Performance Materials, Electronic Materials, and Polymer Additives segments. Sales declined in the Specialty Plastics and Other Businesses segments. Sales to customers outside the United States grew by 16% while sales within the United States fell by 1%. Increased product prices and favorable changes in foreign currency exchange rates were the primary drivers of the increased sales. The effects of lower volume in Specialty Plastics, porcelain enamel products in Performance Coatings, and Polymer Additives partially offset the sales increases. The volume declines were largely the result of weak demand from U.S. markets in automobiles, appliances and residential housing, the company said. Ferro Corp., at Dec. 31, 2007, had total assets of $1.6 billion, total liabilities of $1.1 billion, and a stockholders' equity of $476.2 million, compared to total assets of $1.7 billion, total liabilities of $1.2 billion, and a stockholders' equity of $535.0 million at Dec. 31, 2006. Total debt at the end of 2007 was $526.1 million, a decrease of $66.3 million from the end of 2006. The decline in debt during 2007 was primarily the result of lower cash deposit requirements for precious metal consignments. In addition, the company had net proceeds of $54.6 million from its U.S. accounts receivable securitization program at the end of 2007, compared with $60.6 million at the end of 2006. The company also had $42.1 million in net proceeds from similar programs outside the U.S. at the end of the year, compared with $33.7 million at the end of 2006. The company generated $144.6 million of net cash from operating activities during 2007. Restructuring charges of $16.9 million were recorded in 2007, resulting from rationalization programs in the company's European inorganic materials manufacturing facilities and costs associated with discontinuing dielectric materials production at an Electronic Materials manufacturing location in Niagara Falls, New York. The restructuring project in Electronic Materials was completed in 2007, and the restructuring programs in Europe are expected to continue through 2009. 2008 First-Quarter Estimates Sales for the 2008 first quarter, ending March 31, are expected to be approximately $550 million to $575 million compared with sales of $530 million in the first quarter of 2007, reflecting an ongoing mix of business conditions in different regions. Business conditions in the U.S. are expected to be difficult due to continued weak demand from housing, appliances and automotive markets. Earnings for the first quarter are expected to be in the range of $0.12 to $0.17 per share. This estimate includes expected charges of approximately $0.05 per share, primarily from the continuation of manufacturing rationalization activities. Also included in the first quarter estimates are pre-tax charges of $2 million to $3 million to complete the restoration of full wastewater treatment capabilities at the company's Bridgeport, New Jersey, manufacturing plant. The company reported income from continuing operations of $0.14 per share in the first quarter of 2007, including charges of approximately $0.08 per share. "We continue to build a foundation for the future through aggressive restructuring efforts and organizational change," said Chairman, President and Chief Executive Officer James F. Kirsch. "While we are disappointed by our reported loss for 2007, we are encouraged by strong cash flow from net operating activities and our ability to reduce debt. We will continue to drive cost and expense savings across the business, while investing in our customer relationships and stressing the values and behaviors that support our opportunities to win and enhance value for our shareholders." Kirsch added that the company is on track with the restructuring programs it has initiated over the past 18 months, and that Ferro remains committed to meeting its goal of 10 percent operating margins, as a percent of sales excluding precious metals, in 2010. This will be achieved through organic growth of higher-value products, coupled with incremental savings generated from Ferro's ongoing restructuring programs, aggressive pursuit of manufacturing productivity improvements, improved pricing for value, and expense reductions. About Ferro Corporation Based in Cleveland, Ohio, Ferro Corporation (NYSE: FOE) -- http://www.ferro.com/-- is a global producer of an array of specialty chemicals including coatings, enamels, pigments, plastic compounds, and specialty chemicals for use in industries ranging from construction, pharmaceuticals and telecommunications. Ferro operates through the following five primary business segments: Performance Coatings, Electronic Materials, Color and Performance Glass Materials, Polymer Additives, and Specialty Plastics. Revenues were $2 billion for the FYE ended Dec. 31, 2006. Ferro Corp. has global locations in Argentina, Australia, Belgium, Brazil, China, among others. * * * Ferro Corp. carries Moody's Investors Service's B1 corporate family rating assigned on May 2007. Moody's also assigned a B1 rating to the company's $200 million senior secured notes (issued as unsecured notes in 2001) due in January 2009 and an SGL-3 speculative grade liquidity rating. FINLAY ENTERPRISES: Extends License Contract with Macy's Central ---------------------------------------------------------------- Finlay Enterprises Inc. signed a two-year extension of its license agreement with Macy's Central, a division of Macy's Inc. The amended license agreement extends the company's contract until Jan. 29, 2011. Macy's Central will consist of 222 doors after the completion of the divisional consolidation of Macy's Inc. The divisional consolidation will result in the merging of the former Macy's Midwest and Macy's South divisions. As reported in the Troubled Company Reporter on February 7, 2008, Macy's disclosed new initiatives, including consolidation of three Macy's divisions, to enable the company to both accelerate same- store sales growth and reduce expense. Macy's consolidated its Minneapolis-based Macy's North organization into New York-based Macy's East, its St. Louis-based Macy's Midwest organization into Atlanta-based Macy's South and its Seattle-based Macy's Northwest organization into San Francisco-based Macy's West. The Atlanta-based division was renamed Macy's Central. All store locations remained in place. The consolidation of divisional central office organizations, is expected to be completed in the second quarter of 2008, and would affect roughly 2,500 jobs. Macy's Miami-based Macy's Florida and New-York based Bloomingdale's divisions are not affected. About Macy's Inc. Based in Cincinnati and New York, Macy's Inc. (NYSE: M) fka Federated Department Stores Inc. -- http://www.fds.com/-- is one of the nation's premier retailers. The company operates more than 850 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy's and Bloomingdale's. The company also operates macys.com, bloomingdales.com and Bloomingdale's By Mail. * * * As reported in the Troubled Company Reporter on Oct. 23, 2007, Moody's Investors Service affirmed all ratings of Macy's Inc., including its long term rating of Baa2, Prime 2 short term rating, and (P)Ba1 Preferred shelf rating but changed the outlook to negative from stable. The change in outlook was prompted by the continuing negative comparable store sales in the former May doors, credit metrics that are at the trigger points cited in Moody's Credit Opinion of Feb. 28, 2007, for a downgrade, and the uncertain outlook on consumer spending that could further delay improvement in the former May stores' performance. About Finlay Enterprises Headquartered in New York City, Finlay Enterprises Inc. (Nasdaq: FNLY) -- http://www.finlayenterprises.com/-- through its wholly owned subsidiary, Finlay Fine Jewelry Corporation, retails fine jewelry and operates luxury stand-alone specialty jewelry stores primarily located in the southeastern United States and licensed fine jewelry departments in department stores throughout the United States. The number of locations at the end of fiscal 2007 totaled 794, including 69 Bailey Banks & Biddle, 32 Carlyle and five Congress specialty jewelry stores. * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Standard & Poor's Ratings Services said that the closure of 94 stores due to the consolidation of Macy's divisions will have no immediate impact on Finlay Enterprises' (Finlay; B-/Negative/--) rating or outlook. FORD MOTOR: Tata Inks $3 Bil. Loan to Buy Jaguar & Land Rover ------------------------------------------------------------- Tata Motors Ltd. signed a one-year $3 billion bridging loan with Citigroup Inc. and JPMorgan Chase & Co. for the purchase of Ford Motor Co.'s Jaguar and Land Rover luxury brands, Dow Jones Newswires reports citing an unnamed person familiar with the deal. As reported in the Troubled Company Reporter on March 4, 2008, the sale deal between Ford and Tata Motors is expected to close between April and June. The transaction is speculated to be at a $1.5 billion to $2 billion range. Citigroup and JPMorgan are Tata Motors' financial advisers on the acquisition, the report relates. Tata Motors became the front- runner to buy Jaguar and Land Rover, outbidding Mahindra & Mahindra in collaboration with buyout firm Apollo; and One Equity Partners LLC. Ford should seal a deal with Tata Motors for the acquisition of Ford's Jaguar and Land Rover luxury brand units this Wednesday, Thomson Financial cites The Independent newspaper as saying. According to a Reuters report, Tata Motors is already keen to close the Jaguar/Land Rover deal by the end of this month with the rising borrowing costs. "It's just a matter of time now . . . Tata will obviously want to do the deal by March 31 so they can account for it this fiscal," Reuters quoted PriceWaterhouseCoopers Partner Abdul Majeed, as saying. Tata's 2007/08 fiscal year ends March 31, 2008. With the global credit crunch, a deal now would be more expensive than what was initially planned for, Mr. Majeed pointed out. 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 United Auto Workers. FRONTIER OIL: Earns $43.4 Million in 2007 Fourth Quarter -------------------------------------------------------- Frontier Oil Corp. reported net income of $43.4 million, on revenues of $1.32 billion for the fourth quarter ended Dec. 31, 2007, compared with net income of $52.4 million, on revenues of $1.09 billion for the fourth quarter ended Dec. 31, 2006. The company reported net income of $499.1 million, on revenues of $5.19 billion, for the twelve months ended Dec. 31, 2007, compared with net income of $379.3 million, on revenues of $4.80 billion, for the twelve months ended Dec. 31, 2006. Frontier benefited from wide crude oil differentials in the fourth quarter of 2007, which helped offset lower product margins. The light/heavy crude oil spread averaged $29.40 per barrel for the fourth quarter of 2007 compared to $14.28 per barrel for the fourth quarter of 2006. The WTI/WTS spread averaged $6.95 per barrel in the most recent quarter compared to $4.84 per barrel for the fourth quarter of 2006. Refined product margins were substantially lower in the fourth quarter of 2007 than in 2006 due in part to high crude oil prices and moderating demand for gasoline, particularly in the Rocky Mountain region. The gasoline crack spread averaged $3.27 per barrel for the quarter ended Dec. 31, 2007, compared to $7.96 per barrel for the quarter ended Dec. 31, 2006. The diesel crack spread averaged $16.06 per barrel for the most recent quarter compared to $20.21 for the same period in 2006. Total refinery charges for the fourth quarter of 2007 decreased to 157,772 barrels per day compared to 173,613 for the fourth quarter of 2006 due to throughput constraints from a heavier crude slate at both refineries and a December fire in the coking unit at the Cheyenne Refinery. In order to take advantage of the wide crude oil differentials, Frontier increased the heavy crude oil charge to 59,642 barrels per day for the most recent quarter compared to 43,316 barrels per day for the fourth quarter of 2006. Frontier's chairman, president and chief executive officer, James Gibbs, commented, "Although we are disappointed in the lost opportunity that resulted from the fourth quarter fire in our Cheyenne coking unit, we are very proud of the nearly $500.0 million of net income we reported this year. The gasoline crack spread was weak for the latter part of the fourth quarter and the first half of January, however diesel margins were and continue to be strong. "We will begin a 38-day crude unit turnaround at the El Dorado Refinery on March 1, 2008, during which we will tie-in our new vacuum tower. The new vacuum tower should allow us to run a minimum of 120,000 barrels per day of crude oil, including 25,000 barrels per day of heavy crude." For the three months ended Dec. 31, 2007, Frontier generated cash flow before changes in working capital of $57.4 million. Frontier's cash balance at Dec. 31, 2007, was $297.4 million, down from $432.7 million in the previous quarter due to $44.4 million in share repurchases, $62.4 million in net capital expenditures and an $81.3 million increase in working capital. There were no borrowings under the company's revolving credit facility. For the twelve months ended Dec. 31, 2007, Frontier generated $566.2 million in cash before changes in working capital while investing approximately $280.0 million in net capital expenditures and $248.5 million in share repurchases. The fourth quarter 2007 results include an after-tax hedging loss of $31.5 million, compared to an after-tax gain of $6.9 million for the fourth quarter of 2006. For the twelve months ended Dec. 31, 2007, the after-tax hedging loss totaled $53.6 million, compared to an after-tax hedging gain of $21.5 million for the twelve months ended Dec. 31, 2006. The fourth quarter 2007 results also include an after-tax inventory gain of approximately $40.8 million, compared to a loss of $24.0 million for the same period of 2006. The twelve months ended Dec. 31, 2007, include an after-tax inventory gain of approximately $78.4 million, compared to a loss of $16.1 million for the same period in 2006. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $1.86 billion in total assets, $825.2 million in total liabilities, and $1.04 billion in total stockholders' equity. About Frontier Oil Frontier Oil Corp. (NYSE: FTO) -- http://www.frontieroil.com/-- operates a 110,000 bpd refinery located in El Dorado, Kansas, and a 52,000 bpd refinery located in Cheyenne, Wyoming, and markets its refined products principally along the eastern slope of the Rocky Mountains and in other neighboring plains states. * * * Frontier Oil Corp. still carries Moody's Investors Service's Ba3 corporate family rating assigned on Sept. 21, 2004. Outlook is Stable. GE COMMERCIAL: Six Certificates Acquire Fitch's Low-B Ratings ------------------------------------------------------------- Fitch Rating affirmed these classes of GE Commercial Mortgage Corporation, series 2006-C1, commercial mortgage pass-through certificates: -- $37.1 million class A-1 at 'AAA'; -- $54.4 million class A-2 at 'AAA'; -- $47.2 million class A-3 at 'AAA'; -- $53.2 million class A-AB at 'AAA'; -- $620.1 million class A-4 at 'AAA'; -- $301.3 million class A-1A at 'AAA'; -- $160.9 million class A-M at 'AAA'; -- $146.8 million class A-J at 'AAA'; -- Interest-Only class X-W at 'AAA'; -- $36.2 million class B at 'AA'; -- $14.1 million class C at 'AA-'; -- $24.1 million class D at 'A'; -- $14.1 million class E at 'A-'; -- $14.1 million class F at 'BBB+'; -- $14.1 million class G at 'BBB'; -- $14.1 million class H at 'BBB-'; -- $6.0 million class J at 'BB+'; -- $6.0 million class K at 'BB'; -- $6.0 million class L at 'BB-'; -- $2.0 million class M at 'B+'; -- $4.0 million class N at 'B'; -- $2.0 million class O at 'B-'. Fitch does not rate the $18.1 million class P. The affirmations are due to stable performance and minimal pay down since issuance. As of the February 2008 remittance report, the transaction has paid down 0.8% to $1.596 billion from $1.608 billion at issuance. Interest-only loans comprise 25.1% of the transaction. There are four shadow rated loans in the transaction considered investment grade. 277 Park Avenue (11.9%) is secured by a 1.8 million square foot (sf) office property in Midtown Manhattan. As of September 2007, the property was 97.6% occupied compared to 100% occupied at issuance. KinderCare Portfolio (9.2%) is secured by 713 child care properties located in 37 states. Level 3 Communications (2.8%) is secured by a 776,058 sf office property located in Broomfield, Colorado. The property is 100% leased to Level 3 Communications, Inc. Embassy Suites (1.8%) is secured by a 268 room full service hotel in Alexandria, Virginia. As of September 2007, occupancy was 84.3% with RevPAR of $167.60, compared to 81.7% occupancy and $136.56 RevPAR at issuance. Fitch has identified one loan of concern (0.4%), which is secured by a mixed-use property in Denver, Colorado. The property had a decline in occupancy due to tenants breaking their leases and vacating the spaces. GAP INC: Earns $265 Million in Fourth Quarter Ended February 2 -------------------------------------------------------------- Gap Inc. reported net earnings of $265.0 million for the 13 weeks ended Feb. 2, 2008, compared with $219.0 million for the 14 weeks ended Feb. 3, 2007. Net sales for the 13 weeks ended Feb. 2, 2008, were $4.7 billion. Net sales for the 14 weeks ended Feb. 3, 2007, were $4.9 billion. Due to the 53rd week in fiscal year 2006, comparable store sales for the fourth quarter of fiscal year 2007 are compared with the 13 weeks ended Feb. 3, 2007. On this basis, the company's fourth quarter comparable store sales decreased 3.0% compared with a decrease of 7.0% in the fourth quarter of the prior year. "In 2007, the company made the business decisions and changes necessary to deliver improved earnings for our shareholders," said Glenn Murphy, chairman and chief executive officer of Gap Inc. "While we're aware of the challenging economic environment, our leadership team is committed to delivering the right product to our customers while we bring a sharp operational discipline to our business priorities. We'll work tirelessly to reconnect with customers while we continue to improve our earnings results." Fiscal Year 2007 Results Net sales for the 52 weeks ended Feb. 2, 2008, were $15.8 billion. Net sales were $15.9 billion for the 53 weeks ended Feb. 3, 2007. Due to the 53rd week in fiscal year 2006, fiscal year 2007 comparable store sales are compared with the 52 weeks ended Feb. 3, 2007. On this basis, the company's fiscal year 2007 comparable store sales decreased 4.0% compared with a decrease of 7.0% for the prior year. The company's online sales for the fiscal year increased 24.0% to $903.0 million, compared with $730.0 million in the prior year. Net income for the 52 weeks ended Feb. 2, 2008, was $833.0 million, compared with $778.0 million for the 53 weeks ended Feb. 3, 2007. The company's fourth quarter tax rate was 38.8%. The effective tax rate for fiscal year 2007 was 38.3%. Cash and Short-Term Investments The company ended the fourth quarter with $1.9 billion in cash and short-term investments. Fiscal year 2007 free cash flow was an inflow of $1.4 billion compared with $678.0 million last year. The increase was driven primarily by lower inventory levels as well as changes in vendor payment terms. Share Repurchases During the fourth quarter, the company completed its $1.5 billion share repurchase program and repurchased about 30 million shares for a total of $613.0 million in the quarter. Store Openings and Closings During fiscal year 2007, the company opened 214 store locations and closed 178 store locations. Openings and closings include 18 store repositions and 45 Old Navy Outlet store conversions, while closings also include 19 Forth & Towne stores. Net square footage at the end of the fourth quarter of 2007 was up 1.8% compared with last year. Balance Sheet At Feb. 2, 2008, the company's consolidated balance sheet showed $7.84 billion in total assets, $3.56 billion in total liabilities, and $4.27 billion in total stockholders' equity. About Gap Inc. Headquartered in San Francisco, California, Gap Inc. (NYSE: GPS) -- http://www.gapinc.com/-- is an international specialty retailer offering clothing, accessories and personal care products for men, women, children and babies under the Gap, Banana Republic, Old Navy, Forth & Towne and Piperlime brand names. Gap Inc. operates more than 3,100 stores in the United States, the United Kingdom, Canada, France, Ireland and Japan. In addition, Gap Inc. is expanding its international presence with franchise agreements for Gap and Banana Republic in Southeast Asia and the Middle East. * * * Moody's Investor Service placed Gap Inc.'s corporate family, senior unsecured debt and probability of default ratings at 'Ba1' in February 2007. The ratings still hold to date with a stable outlook. GRAN TIERRA: Net Loss Rises to $8 Mil. in Year ended December 31 ---------------------------------------------------------------- Gran Tierra Energy Inc. reported financial and operating results for the quarter and year ended Dec. 31, 2007. The net loss for 2007 was $8.5 million compared to a net loss of $5.8 million in 2006. The 2007 results reflect a full year of Colombian and Argentine operating activities and the impact of new oil production from the company's 2007 discoveries in Colombia and Argentina. The 2007 financial results were impacted by non-cash expenses of $7.4 million, compared to $1.5 million in 2006, related to liquidated damages arising from the company's 2006 financing and a $3 million loss on valuation of derivative financial instruments. Net income for the quarter was $2.2 million as compared to a net loss of $4 million for the same period in 2006. The fourth quarter 2007 results reflect the increase in the company's oil production in Colombia during the quarter resulting from the oil discoveries in the first half of 2007. Cash provided by operations for 2007 was $6.2 million compared to cash used in operations of $0.8 million in 2006. The company reported cash and equivalents of $18.2 million at 2007 year end as compared to $24.1 million at Dec. 31, 2006. Working capital decreased to $8.1 million as compared to $14.5 million at the end of 2006. Shareholders' equity increased from $76.2 million at Dec. 31, 2006 to $76.8 million at Dec. 31, 2007, and the company reported no outstanding long-term debt as of year end 2007. At Dec. 31, 2007, the company's balance sheet showed total assets of $112.79 million, total long term liabilities of $36 million and total shareholders' equity of $76.79 million. "2007 was an extraordinary year for Gran Tierra Energy," state Dana Coffield, president and chief executive officer of Gran Tierra Energy Inc. "Dramatic oil reserve additions resulting from drilling success on company operated properties in Colombia and Argentina in 2007 transformed the company from an exploration led company to a rapidly growing exploration and production company." "Gran Tierra Energy has entered 2008 with an exciting portfolio of exploration and development opportunities and a solid production base. The company is the operator of all of its nine exploration and production contracts in Colombia, seven of its eight contracts in Argentina and both of its two contracts in Peru," Ms. Coffield said. "Gran Tierra Energy's 2008 capital program is focused on developing oil reserves, growing production and increasing cash flow by drilling six delineation and development wells." "In parallel, we will continue conducting exploration operations, with three exploration wells budgeted for 2008 targeting additional prospects to potentially grow our reserve base in Colombia and Argentina, in addition to gravity and magnetic data acquisition on our vast exploration land position in Peru," added Ms. Coffield. Successive Net Losses As reported in the Troubled Company Reporter on Jan. 4, 2008, the company disclosed in the regulatory filing that it "has a history of net losses." The company said it expects to incur substantial expenditures to further its capital investment programs and the company's existing cash balance and cash flow from operating activities may not be sufficient to satisfy its current obligations and meet its capital investment commitments. According to the company, its ability to continue as a going concern is dependent upon obtaining the necessary financing to acquire, explore and develop oil and natural gas interests and generate profitable operations from its oil and natural gas interests in the future. About Gran Tierra Energy Headquartered in Calgary, Alberta, Canada, Gran Tierra Energy Inc. (OTC BB: GTRE.OB) -- http://www.grantierra.com/-- is an international oil and gas exploration and production company, incorporated and traded in the United States and operating in South America. The company holds interests in producing and prospective properties in Argentina, Colombia and Peru. GRAPHIC PACKAGING: Moody's Keeps Low-B Ratings on Altivity Merger ----------------------------------------------------------------- Moody's Investors Service affirmed Graphic Packaging International Inc.'s B1 corporate family rating, B3 subordinated notes, and SGL- 3 speculative grade liquidity rating (indicating adequate liquidity) following the announcement of the completed combination of its operations with Altivity Packaging, LLC. Moody's also assigned a Ba3 rating to the company's new $1.2 billion term loan C due 2014. The existing ratings have been downgraded on both the secured bank facilities, to Ba3 from Ba2, and the senior unsecured notes, to B3 from B2, due to the revised capital structure. The additional amounts of senior secured debt move the ratings of this debt toward the B1 corporate family rating while the senior unsecured notes are lowered by one notch. The outlook remains negative. Proceeds from the transaction will be used to pay off Altivity's existing debt, thus Altivity's ratings have been withdrawn. Rating and Outlook Actions: Issuer: Graphic Packaging International Inc. Affirmed: -- Corporate family rating affirmed at B1 -- 9.5% Subordinated notes due 2013 affirmed at B3 (LGD 6, 94%) -- Outlook remains Negative Assigned: -- Senior secured term loan C assigned Ba3 (LGD3, 35%) Downgraded: -- Senior secured bank facilities downgraded to Ba3 from Ba2 (LGD3, 35%) -- 8.5% Senior unsecured notes due 2011 downgraded to B3 from B2 (LGD 5, 79%) The affirmation of the corporate family rating still reflects Moody's view that the combination of the two companies is a credit neutral event. Leverage remains high relative to the company's corporate family rating, but Moody's expects credit protection measures to improve from recently observed levels primarily due to recent positive supply trends in the paperboard sector, stabilizing input costs, and the successful renegotiation of pricing terms with contracted customers in the beverage business. The favorable pricing terms will provide additional pass-through flexibility during periods of escalating input costs. In addition, given the two companies' geographic and product line overlap, the prospective transaction provides opportunities for cost savings and synergies. Synergies include enhanced procurement, plant rationalization, mill optimization and SG&A savings. Specifically, Moody's believes these factors will provide the company with an opportunity to improve margins, generate free cash flow, and reduce debt to support the existing ratings. Graphic Packaging generated better-than-expected operating results in 2006 and 2007. Energy costs have begun to moderate, additional mill closures have been announced in the paperboard sector, prices for CUK (coated unbleached kraft) and CRB (coated recycled board) have increased, cost savings have been executed, and renegotiated contracts in the beverage business have economically benefited the company. With respect to Altivity, management has executed on certain of its cost reduction efforts after Moody's initial ratings in June 2006. However, even with this progress, Moody's believes that relatively flat demand levels within the consumer packaging paper industry could affect recent price increases and the company's ability to sustain margin improvements. Furthermore, management will continue to face challenges as it attempts to integrate the two companies while managing its exposure to high input costs and the pressure of creating innovative products in a competitive industry. Thus, the company's actual debt reduction over the intermediate period may not support the existing ratings. Moody's continues to maintain a negative outlook on the ratings based on these rating drivers. If it is not evident that the company is making progress towards achieving acceptable leverage (towards 5.0x EBITDA) on an adjusted basis, the ratings may go down. At the same time, Moody's will likely stabilize the outlook if the company demonstrates the execution of its current debt reduction and integration plans and reduces leverage to 5.0x EBITDA. Graphic Packaging International, Inc., located in Marietta, Georgia, is a provider of paperboard packaging solutions. GREAT PLAINS: Earns $157.6 Million in Year Ended December 31 ------------------------------------------------------------ Great Plains Energy Incorporated reported earnings of $157.6 million for the year ended Dec. 31, 2007, compared to full- year 2006 earnings of $126.0 million. Core earnings were $133.4 million for the full-year 2007, compared to $150.9 million in 2006. Core earnings is a non-GAAP financial measure excludes net mark- to-market gains and losses on energy contracts and other items. Compared to 2006, full-year 2007 core earnings were favorably impacted by weather, increased wholesale revenues, new retail rates, and increased customer usage at Kansas City Power & Light, as well as higher delivered volumes at Strategic Energy. These positive factors were more than offset by the impact of plant outages during the first and second quarters at KCP&L, lower gross margin, increased bad debt expense, a first quarter resettlement charge at Strategic Energy and by higher expenses at the holding company. "Although 2007 was a challenging year for Great Plains Energy, we remain enthusiastic about the prospects for our company," commented chairman and chief executive officer Mike Chesser. "Our long-term growth path remains clear. Completion of the Aquila acquisition, fulfillment of our Comprehensive Energy Plan, and the conclusion of our strategic assessment for Strategic Energy will provide a platform for future growth in earnings and dividends for Great Plains Energy shareholders." For the fourth quarter of 2007, reported earnings of $47.7 million rose $13.6 million compared to the same period last year. Core earnings were $31.2 million in the fourth quarter of 2007 compared to $25.5 million in the fourth quarter of 2006. Retail and wholesale revenues at KCP&L were the primary drivers of the improvement, partially offset by higher purchased power expense and an increase in holding company costs. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $4.83 billion in total assets, $3.22 billion in total liabilities, $39.0 million in cumulative preferred stock, and $1.57 billion in total common shareholders' equity. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $654.9 million in total current assets available to pay $990.2 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?292b About Great Plains Headquartered in Kansas City, Missouri, Great Plains Energy Incorporated (NYSE: GXP) -- http://www.greatplainsenergy.com/-- is the holding company for Kansas City Power & Light Company, a leading regulated provider of electricity in the Midwest, and Strategic Energy L.L.C., a competitive electricity supplier. GS MORTGAGE: S&P Cuts Rating on Class J Certs. to 'BB' From 'BBB-' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its ratings on three classes of commercial mortgage pass-through certificates from GS Mortgage Securities Corp. II's series 2006-GSFL VIII. Concurrently, S&P lowered its ratings on two classes from the same series. Additionally, S&P affirmed its ratings on five classes from this series. The upgrades and affirmations reflect Standard & Poor's analysis of the remaining loans in the pool, as well as increased credit enhancement levels resulting from loan payoffs. The downgrades of the class H and J certificates reflect Standard & Poor's revised valuations of the CarrAmerica Corporate Center and Hardage Portfolio loans. Together, these assets represent 69% of the remaining collateral pool. As of the March 6, 2008, remittance report, the trust collateral consisted of the senior participation interests in one floating- rate interest-only mortgage loan, two IO floating-rate whole- mortgage loans, and two IO floating-rate pari passu mortgage loans. All of the loans are indexed to one-month LIBOR. The pool balance has declined 69% to $204.4 million since issuance. To date, the trust has experienced no losses. Details of the three largest loans, which makes up 83% of the pool, are: -- The largest loan in the pool, CarrAmerica Corporate Center, has a trust and whole-loan balance of $75.0 million (37%). Eight class A office buildings totaling 1.0 million sq. ft. in Pleasanton, California, secure the loan. In addition, the borrower's equity interest in the property secures a $25.0 million mezzanine loan. The master servicer, Wells Fargo Bank N.A., reported a debt service coverage of 1.75x for the nine months ended Sept. 30, 2007, and an occupancy of 66% as of early March 2008. The low occupancy is attributable to a large tenant that had occupied 14% of the gross leaseable area vacating the premises upon its March 2008 lease expiration date. The borrower is actively marketing the vacant space. Standard & Poor's used a stabilized approach to arrive at a valuation that represents a 10% decline since issuance. The loan is currently scheduled to mature in November 2008, and has two one-year extension options remaining. -- The second-largest loan in the pool, Hardage Portfolio, has a whole-loan balance of $71.8 million that is divided into two pieces: a $66.9 million senior component that makes up 33% of the trust balance and a $4.9 million subordinate component that provides the sole source of cash flow for the unrated H- HP raked certificate class. In addition, the borrower's equity interests in the properties secure two mezzanine loans totaling $38.2 million. Six extended-stay and two full- service hotels totaling 1,049 rooms in five states secure the loan. An $11.2 million renovation plan, scheduled for six of the eight properties that includes replacing soft goods in guest rooms, refurnishing the meeting rooms, modernizing the lobby, and installing a full-service restaurant at two of the properties, was delayed. The renovation work on three of the properties was completed in the summer of 2007. The anticipated completion date for the remaining three properties undergoing renovation is in the first quarter of 2008. The master servicer reported a combined occupancy of 64% as of December 2007 and a combined DSC of 2.10x for the nine months ended Sept. 30, 2007, for the Hardage Portfolio loan. The low occupancy was partially due to ongoing renovation work at six of the eight properties. Standard & Poor's incorporated the borrower's 2008 budget into its analysis to derive a valuation that is 18% below the valuation at issuance. The valuation decline is primarily due to a substantial increase in operating expenses. The loan matures in April 2009 and has two one-year extension options remaining. Wells Fargo placed this loan on its watchlist after it triggered a cash trap event that was attributable to a decline in net operating income. -- Illini Tower, a 16-floor student housing facility with 207 units in Champaign, Illinois, secures the third-largest loan in the pool ($28.0 million, 14%). In addition, the borrower's equity interests in the property secure a $12.0 million mezzanine loan. Wells Fargo reported a DSC of 2.00x for the year ended Dec. 31, 2006, and 100% occupancy as of October 2007. Standard & Poor's adjusted net cash flow is comparable to its level at issuance. The loan is scheduled to mature in June 2008, and has three one-year extension options remaining. The fifth-largest loan in the pool, Investcorp Retail Portfolio, is on the master servicer's watchlist. The whole-loan balance is $260.1 million, which consists of a $137.1 million senior component and a $123.0 million subordinate component that is held outside the trust. The senior component is further split into two pari passu pieces, of which $11.7 million makes up 6% of the trust balance. The trust balance reflects $52.1 million in paydowns since issuance due to collateral releases. The remaining collateral includes a portfolio of 23 shopping centers totaling 2.3 million sq. ft. in Texas. For the six months ended June 30, 2007, the master servicer reported a DSC of 1.40x and occupancy of 92%. Standard & Poor's adjusted NCF was comparable to its level at issuance. The master servicer placed this loan on its watchlist because of its April 2008 maturity date and insufficient insurance coverage. The master servicer indicated that the insurance coverage issue has been resolved, and the borrower has exercised one of its three one-year extension options. The loan will be removed from its watchlist next month. Ratings Raised GS Mortgage Securities Corp. II Commercial mortgage pass-through certificates series 2006-GSFL VIII Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ C AAA AA+ 48.18% D AA+ AA 33.12% E AA AA- 25.79% Ratings Lowered GS Mortgage Securities Corp. II Commercial mortgage pass-through certificates series 2006-GSFL VIII Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ H BBB BBB+ 8.05% J BB BBB- N/A Ratings Affirmed GS Mortgage Securities Corp. II Commercial mortgage pass-through certificates series 2006-GSFL VIII Class Rating Credit enhancement ----- ------ ------------------ A-2 AAA 73.84% B AAA 58.98% F A 18.46% G A- 11.67% X AAA N/A N/A - Not applicable. GSV INC: Brooks Extends Due Date of $180,000 Note to Sept. 1 ------------------------------------------------------------ GSV Inc. disclosed in a regulatory filing that Brooks Station Holdings Inc. has agreed to extend the maturity of a promissory note issued by GSV on July 21, 2003, from March 1, 2008, to Sept. 1, 2008, and to waive any claim against GSV or its assets arising from GSV's failure to repay the Note on the original maturity date. The Note had an original principal amount of $180,000 and accrued interest of $32,533.33 through March 1, 2008. It bears interest at a rate of 8% per annum and is secured by a lien on all of GSV's assets. GSV said it paid Brooks Station $10,000 of the accrued and unpaid interest on the Note and $20,000 of the principal balance of the Note, thus reducing the outstanding principal balance of the Note to $160,000 and the accrued interest to $22,533.33. About GSV Inc. Based in Westport, Conn., GSV Inc. (OTC BB: GSVI) -- http://www.gsv.com/-- owns interests in oil and gas properties in Texas and Louisiana. The company also owns interests in Cybershop L.L.C., which owns interests in oil and gas properties in Texas, as well as holds rights to certain geologic studies. Going Concern Doubt UHY LLP expressed substantial doubt about GSV Inc.'s ability to continue as a going concern after auditing the company's financial statements for the year ended Dec. 31, 2006. UHY reported that the company has incurred recurring operating losses, and it has negligible working capital at Dec. 31, 2006. The auditing firm added that the company's expected future sources of revenue will be derived from its investments in oil and gas, but the attainment of profitability from these investments is not assured. HAMILTON GARDENS: Eroding Credit Quality Spurs Moody's Rating Cuts ------------------------------------------------------------------ Moody's Investors Service downgraded ratings of seven classes of notes issued by Hamilton Gardens CDO II, Ltd. One of these ratings was left on review, with future direction uncertain. The notes affected by this rating actions are: Class Description Up to $120,000,000 Class A-1a Floating Rate Notes Due August 2052 -- Prior Rating: Aaa -- Current Rating: B3, on review with future direction uncertain Class Description: $80,000,000 Class A-1b Floating Rate Notes Due August 2052 -- Prior Rating: Aaa -- Current Rating: C Class Description: $40,000,000 Class A-1c Floating Rate Notes Due August 2052 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: C Class Description: $49,400,000 Class A-2 Floating Rate Notes Due August 2052 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: C Class Description: $17,200,000 Class B Floating Rate Notes Due August 2052 -- Prior Rating: Aa2, on review for possible downgrade -- Current Rating: C Class Description: $25,000,000 Class C Deferrable Floating Rate Notes Due August 2052 -- Prior Rating: A2, on review for possible downgrade -- Current Rating: C Class Description: $26,400,000 Class D Deferrable Floating Rate Notes Due August 2052 -- Prior Rating: Baa2, on review for possible downgrade -- Current Rating: C The rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence, as reported by the Trustee on March 5, 2008, of an event of default caused when the Class A Overcollateralization Ratio is less than 95% on any Measurement Date, as described under Section 5.1 (h) of the Indenture dated Aug. 15, 2007. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, certain parties to the transaction may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. In this regard the Trustee reports that a majority of the Aggregate outstanding Amount of the Controlling Class has directed the Trustee to declare the principal of all the Notes to be immediately due and payable. Additionally, Moody's has been notified that the Controlling Class has directed the Trustee to proceed with the sale or termination of all of the collateral in accordance with the applicable provisions of the Indenture. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The severity of losses of certain tranches may be different, however, depending on the timing and outcome of the liquidation. Because of this uncertainty, the ratings assigned to the Class A-1a Notes remain on review, with future direction uncertain. Hamilton Gardens CDO II, Ltd is a collateralized debt obligation backed primarily by a portfolio of CDO and RMBS securities. HANCOCK FABRICS: Jeff Nerland Quits as Chief Financial Officer -------------------------------------------------------------- Larry D. Fair, vice president for finance at Hancock Fabrics, Inc., disclosed in a filing with the U.S. Securities and Exchange Commission that Jeff Nerland resigned from his position as interim CFO of the company. Mr. Nerland, however, will stay on as executive vice president at Hancock. Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc. (OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty retailer of a wide selection of fashion and home decorating textiles, sewing accessories, needlecraft supplies and sewing machines. Hancock Fabrics is one of the largest fabric retailers in the United States, currently operating approximately 400 retail stores in approximately 40 states. The company employs approximately 7,500 people on a full-time and part-time basis. Most of the company's employees work in its retail stores, or in field management to support its retail stores. The company and six of its debtor-affiliates filed for chapter 11 protection on March 21, 2007 (Bankr. D. Del. Lead Case No. 07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, represent the Debtors. As of Sept. 1, 2007, Hancock Fabrics disclosed total assets of $159,673,000 and total liabilities of 122,316,000. The Debtors' exclusive period to file a Chapter 11 Plan expires on May 30, 2008. (Hancock Fabric Bankruptcy News, Issue No. 27, Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). HANCOCK FABRICS: Names Robert Driskell as Chief Financial Officer ----------------------------------------------------------------- Hancock Fabrics, Inc., and its debtor-affiliates appointed Robert W. Driskell as senior vice president and chief financial officer on February 25. Mr. Driskell, 33, has more than 10 years of financial management and leadership experience, most recently serving as chief financial officer of Reeves Williams, LLC, a large privately held construction firm based in Memphis, Tennessee, from January 2005. Before that, he held multiple positions in public accounting, including assignments with several specialty retailers, culminating with the position of audit manager with KPMG, LLP from November 2003 until December 2004. Mr. Driskell received his Bachelor of Science in Accounting from Florida State University, obtained his Masters of Business Administration from the Warrington College of Business at the University of Florida, and is a member of the American Institute of Certified Public Accountants. Larry D. Fair, vice president for finance, disclosed in a filing with the U.S. Securities and Exchange Commission that Hancock will pay Mr. Driskell a base salary of $190,000. Mr. Driskell is eligible to participate in the company's Annual Cash Bonus Plan, which provides: -- a minimum bonus of 20% of base salary; -- a target bonus of 40% of base salary; and -- a maximum bonus of 50% of base salary if corporate and personal performance goals are achieved. Hancock has also granted the new CFO 25,000 restricted shares of the Company's common stock, which will vest 20% annually, beginning on the date of grant, and an option to purchase 25,000 shares of the Company's common stock, which option will vest 25% each year. He will be eligible to participate in Hancock's 2008 Long Term Restricted Stock Plan, which provides for an annual retention grant of 5,000 shares and additional performance based awards, and will be entitled to other employee benefits as are generally accorded to employees and officers of the company. About Hancock Fabrics Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc. (OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty retailer of a wide selection of fashion and home decorating textiles, sewing accessories, needlecraft supplies and sewing machines. Hancock Fabrics is one of the largest fabric retailers in the United States, currently operating approximately 400 retail stores in approximately 40 states. The company employs approximately 7,500 people on a full-time and part-time basis. Most of the company's employees work in its retail stores, or in field management to support its retail stores. The company and six of its debtor-affiliates filed for chapter 11 protection on March 21, 2007 (Bankr. D. Del. Lead Case No. 07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, represent the Debtors. As of Sept. 1, 2007, Hancock Fabrics disclosed total assets of $159,673,000 and total liabilities of 122,316,000. The Debtors' exclusive period to file a Chapter 11 Plan expires on May 30, 2008. (Hancock Fabric Bankruptcy News, Issue No. 27, Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). HANCOCK FABRICS: Seeks Court Approval of Changes to CRG Employment ------------------------------------------------------------------ Hancock Fabrics, Inc., and its debtor-affiliates seek authority from the United States Bankruptcy Court for the District of Delaware to modify the employment arrangement of CRG Partners Group, LLC, to re-designate Jeff Nerland as executive vice- president, effective February 25, to facilitate the transition to a new chief financial officer and the Debtors' reorganization processes. The Debtors designated Mr. Nerland as interim executive vice president and chief financial officer pursuant to a court-approved agreement with Corporate Revitalization Partners, LLC, for the provision of temporary staff to the Debtors. CRP merged with The Recovery Group, Inc., to form CRG. Derek C. Abbott, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware, relates that Mr. Nerland has executed his duties as CFO and has been integral to the Debtors' progress towards reorganization. The Debtors, anticipating eventual emergence from their Chapter 11 cases as reorganized entities, searched for personnel to permanently fill vacancies and eventually determined to employ Robert Driskell. Mr. Abbott says Mr. Nerland's continued services are critical to the Debtors, particularly in light of the pending Chapter 11 Cases. In addition to the importance of Mr. Nerland's historical and institutional knowledge of the Debtors to the CFO transition process, Mr. Nerland's bankruptcy and restructuring expertise and experience will be invaluable to meeting the Debtors' remaining objectives in their Chapter 11 Cases including: a. administration of claims asserted against the Debtors; b. supporting the presentations, negotiations, due diligence, documentation related to and closing of exit financing on terms acceptable to the Debtors; c. disposition of executory contracts; and d. confirmation of a plan of reorganization. About Hancock Fabrics Headquartered in Baldwyn, Mississippi, Hancock Fabrics Inc. (OTC: HKFIQ) -- http://www.hancockfabrics.com/-- is a specialty retailer of a wide selection of fashion and home decorating textiles, sewing accessories, needlecraft supplies and sewing machines. Hancock Fabrics is one of the largest fabric retailers in the United States, currently operating approximately 400 retail stores in approximately 40 states. The company employs approximately 7,500 people on a full-time and part-time basis. Most of the company's employees work in its retail stores, or in field management to support its retail stores. The company and six of its debtor-affiliates filed for chapter 11 protection on March 21, 2007 (Bankr. D. Del. Lead Case No. 07-10353). Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, represent the Debtors. As of Sept. 1, 2007, Hancock Fabrics disclosed total assets of $159,673,000 and total liabilities of 122,316,000. The Debtors' exclusive period to file a Chapter 11 Plan expires on May 30, 2008. (Hancock Fabric Bankruptcy News, Issue No. 27, Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000). HEALTH MANAGEMENT: Moody's Pares Corporate Family Rating to 'B1' ---------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating of Health Management Associates, Inc. to B1 from Ba3 and placed the ratings under review for possible further downgrade. Moody's also downgraded the rating on the company's senior secured credit facility to Ba3 from Ba2. "The downgrade of HMA's Corporate Family Rating reflects declining profitability and cash flows which have led to debt reduction and credit metric improvements below our previous expectations," said Dean Diaz, Moody's Senior Credit Officer. Since the recapitalization of the company, including the payment of a $2.4 billion special dividend in the first quarter of 2007, margins have been pressured by rising bad debt expense and weak volume growth. Accordingly, Moody's believes the company's credit metrics will remain below levels reflective of the "Ba" rating category. Moody's understands that HMA is contemplating several divestiture and joint venture opportunities that could provide the company with $200 to $400 million of proceeds in the very near-term. Notwithstanding the completion of these transactions, the rating review considers Moody's belief that HMA may need to take further steps if the company is required to fully fund the potential put obligation of the convertible subordinated notes on Aug. 1, 2008. Additionally, Moody's believes it may take time for improvements from recent initiatives to be realized while HMA's operating performance will likely continue to be challenged by many of the unfavorable industry trends in the near term. Moody's review of the ratings is expected to focus on the ability of the company to sufficiently fund a put of the convertible sub notes and indication that the company's operational initiatives are gaining traction, as evidenced by improved credit metrics. The ratings continue to be supported by HMA's considerable scale. HMA is one of the largest non-urban hospital operators in the US and the company's strategic focus on non-urban markets often allows its hospitals to benefit from a less competitive environment. The rating also reflects stable trends in reimbursement and pricing, measured as growth in same-facility revenue per adjusted admission, which continues to be favorable for the hospital industry and HMA. These ratings have been downgraded: -- $500 million senior secured revolving credit facility, to Ba3 (LGD3, 42%) from Ba2 (LGD3, 41%) -- $2,750 million senior secured term loan, to Ba3 (LGD3, 42%) from Ba2 (LGD3, 41%) -- Corporate Family Rating, to B1 from Ba3 -- Probability of Default Rating, to B1 from Ba3 Headquartered in Naples, Florida, HMA is an owner and operator of acute-care hospitals in non-urban settings. The company provides inpatient services such as general surgery, and oncology as well as outpatient services such as laboratory, x-ray and physical therapy services. In addition, some facilities also offer specialty services such as cardiology, radiation therapy and MRI scanning. HMA recognized revenues of approximately $4.4 billion in the twelve months ended Dec. 31, 2007. IMPAC MORTGAGE: EVPs Andrew McCormick and Richard Johnson Resign ---------------------------------------------------------------- Impac Mortgage Holdings Inc. said in a regulatory filing that Andrew McCormick and Richard Johnson have resigned from the company. Andrew McCormick, executive vice president and chief investment officer of the company, will be leaving the company on March 31, 2008, to join the staff of a major investment management firm. Mr. Johnson's resignation as executive vice president and chief operating Officer is effective March 12, 2008. Mr. Johnson will continue to provide consulting services to the company. As a result of the changes to its business plan and from its consolidation efforts, the company does not anticipate filling either of these positions at this time. The company also disclosed that it is in the final renegotiations to settle a significant portion of its repurchase liabilities and refinance its remaining warehouse borrowings. The company anticipates the outcome of these negotiations will result in additional disclosures in the 2007 financial statements. As a result, the company will be filing for an extension of the filing date of its Form 10-K for the year ended Dec. 31, 2007. The company said, however, that even though the company will do everything it can to file the Form 10-K by the extension date, it is unlikely the company will be able to do so. About Impac Mortgage Headquartered in Irvine, California, Impac Mortgage Holdings Inc. (NYSE: IMH) -- http://www.impaccompanies.com/-- is a mortgage REIT, which through its Long Term Investment Operations is primarily invested in non-conforming Alt A mortgage loans (Alt-A) and to a lesser extent small balance commercial and multi-family loans. The company also operates a significantly reduced Mortgage Operations, which acquires, originates and sells conforming loans that are eligible for sale to government sponsored agencies. The company is organized as a REIT for tax purposes, which generally allows it to pass through earnings to stockholders without federal income tax at the corporate level. * * * At Sept. 30, 2007, the company's consolidated balance sheet showed $19.41 billion in total assets and $19.90 billion in total liabilities, resulting in a $493.3 million total stockholders' deficit. INTERNATIONAL RECTIFIER: Appoints Tom Lacey to Board of Directors ----------------------------------------------------------------- International Rectifier Corporation elected Tom Lacey to its board of directors. Mr. Lacey will additionally serve as a member of the board's audit committee and corporate governance and nominating committee. Mr. Lacey, 49, served as president of Flextronics International's Components Division, now Vista Point Technologies, from 2006 until his retirement in late 2007. Prior to Flextronics, Mr. Lacey was chairman and chief executive officer of International DisplayWorks, a liquid crystal display company, from 2004. At International DisplayWorks, Mr. Lacey significantly grew revenue, profit, market capitalization, achieved listing on the Nasdaq National Market, and ultimately led the sale of the company to Flextronics in 2006. Prior to International DisplayWorks, Mr. Lacey spent 13 years at Intel Corporation in various positions including serving as vice president and general manager of Intel's Flash Products Group. During his tenure at Intel, Mr. Lacey also served as president of Intel Americas/vice president of sales and marketing from 1998 to 2003. Prior to that, he served as director product marketing/ business management for Asia, Hong Kong after progressing through other management roles of increasing responsibility. "We are very pleased to welcome Tom to our board as his extensive leadership, engineering, marketing, sales, and management operations experience in our industry will be very helpful as we work to strengthen IR," Oleg Khaykin, International Rectifier's chief executive officer and director, said. Mr. Lacey was elected to serve a board term scheduled to expire at the company's next annual meeting. In connection with Mr. Lacey's election to the board, the board amended the bylaws of the company to increase the size of the board from seven to eight members. About International Rectifier Based in El Segundo, California, International Rectifier Corporation (NYSE:IRF) -- http://www.irf.com/-- is a designer, manufacturer and marketer of power management product devices, which use power semiconductors. The company's products are used in a variety of end applications, including computers, communications networking, consumer electronics, energy-efficient appliances, lighting, satellites, launch vehicles, aircraft and automotive diesel injection. Its products consist of Power Management Integrated Circuits (Power Management ICs), Power Components and Power Systems. It summarizes its segments in two groups: Focus Products and Non-Focus Products. The company has manufacturing facilities in the U.S., Mexico, United Kingdom, Germany and Italy; and has subsidiaries in Japan and Singapore. * * * International Rectifier Corporation continues to carry Standard & Poor's 'BB' long term foreign and local issuer credit ratings, which were placed in April 2007. INTEREP NATIONAL: Non-Payment of $100MM Bonds May Cue Bankruptcy ---------------------------------------------------------------- Interep National Radio Sales Inc. is on the verge of bankruptcy as it is required to pay $100 million in bonds, Adrants reports, citing an undisclosed source. According to the report, the longevity and profitability of the company's present business model is now in question. The report adds that Interep's business model may eventually die unless innovated or totally replaced. Adrants notes that radio no longer offers as much as it did in the past especially with the fierce competition. However, the report says that radio will continue to exist but only if coupled with the needed changes and adjustments to its business model. About Interep New York-based Interep National Radio Sales Inc. (OTC: IREP) -- http://www.interep.com/-- is an independent national spot radio representation (rep) firm in the United States. It is the rep firm for over 1,500 radio stations nationwide. Interep is an advertising sales and marketing company in the radio industry. Through 17 offices across the country, the Company serves its radio station clients and advertisers in all 50 states and portions of Mexico and Canada. Interep provides national sales representation for clients whose formats include country, rock, sports, Hispanic, classical, urban, news, talk, oldies, adult contemporary, jazz, contemporary hits, etc. JAMES RIVER: To Market 3 Million Shares in Public Offering ---------------------------------------------------------- James River Coal Company agreed to sell 3 million shares, with an over-allotment option to sell up to an additional 450,000 shares, of its common stock in a public offering through UBS Investment Bank. "The proceeds of this offering will be used, in part, to accelerate the development of several smaller internal projects that we have delayed for the past couple of years due to conditions in the capital markets and soft coal prices," Peter T. Socha, chairman and chief executive officer of James River Coal Company, commented. "The projects include the recovery of waste coal from an existing JRCC site and several smaller projects to reduce operating costs from current mine production." A written prospectus may be obtained, when available, from sales representatives of: UBS Securities LLC Attn: Prospectus Department 299 Park Avenue New York, NY 10171 Tel(212)-821-3884. After this offering there will be approximately 24,911,465 shares of common stock outstanding or 25,361,465 shares if the over- allotment option is exercised in full. About James River Coal Company Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. * * * James River Coal Co. continues to carry Standard & Poor's "CCC" long term foreign and local issuer credit rating, which were placed in May 2007. JP MORGAN: Stable Performance Cues Fitch To Hold Six Low-B Ratings ------------------------------------------------------------------ Fitch Ratings affirmed J.P. Morgan Chase Commercial Mortgage Securities Inc. Trust pass-through certificates, series 2005- CIBC13: -- $49.8 million class A-1 at 'AAA'; -- $318.6 million class A-1A at 'AAA'; -- $130.2 million class A-2 at 'AAA'; -- $250 million class A-2FL at 'AAA'; -- $206.4 million class A-3A1 at 'AAA'; -- $25 million class A-3A2 at 'AAA'; -- $751.7 million class A-4 at 'AAA'; -- $135.1 million class A-SB at 'AAA'; -- $272.1 million class A-M at 'AAA'; -- $187 million class A-J at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- $54.4 million class B at 'AA'; -- $23.8 million class C at 'AA-'; -- $44.2 million class D at 'A'; -- $34 million class E at 'A-'; -- $37.4 million class F at 'BBB+'; -- $30.6 million class G at 'BBB'; -- $34 million class H at 'BBB-'; -- $10.2 million class J at 'BB+'; -- $17 million class K at 'BB'; -- $10.2 million class L at 'BB-'; -- $6.8 million class M at 'B+'; -- $10.2 million class N at 'B'; -- $6.8 million class P at 'B-'. Fitch does not rate the $37.4 million class NR certificates. The rating affirmations reflect stable performance and limited paydown since the last Fitch rating action. As of the March 2008 distribution date, the transaction has paid down by 0.7% to $2.68 billion from $2.70 billion at the last rating action. There are five (1.6%) specially serviced loans with expected losses that would be fully absorbed by the non-rated class NR. The largest specially serviced loan (0.7%) is secured by a 648- unit multifamily property located in Tallahassee, Florida and is 90+ days delinquent. The loan transferred to special servicing in August 2007 due to payment default. The second-largest specially serviced asset (0.3%) is a real estate-owned (REO) portfolio collateralized by five multifamily properties located in Tallahassee, Florida that have a total of 266 units. The loan is 90+ days delinquent and was transferred to special servicing in February 2007 due to imminent default. The third-largest specially serviced loan (0.2%) is secured by a portfolio of two multifamily properties located in Tallahassee, Florida that is 90+ days delinquent. None of the loans mature in 2008 or 2009, and 14.7% of the pool matures in 2010. JP MORGAN: Fitch Maintains Low-B Ratings on Five 2002-CIBC4 Certs. ------------------------------------------------------------------ Fitch affirmed JP Morgan Chase Commercial Mortgage Securities Corporation's commercial mortgage pass-through certificates, series 2002-CIBC4: -- $82.6 million class A-2 at 'AAA'; -- $403.2 million class A-3 at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- $32.0 million class B at 'AAA'; -- $34.0 million class C at 'AAA'; -- $10 million class D at 'AAA'; -- $24 million class E at 'AA'; -- $12 million class F at 'A'; -- $14 million class G at 'BBB+'; -- $12.0 million class H at 'BB+'; -- $4.0 million class J at 'BB'; -- $6.0 million class K at 'B+'; -- $8.0 million class L at 'B'; -- $4.0 million class M at 'B-'. Fitch does not rate the $5.8 million class NR. Class A-1 has been paid in full. The rating affirmations reflect stable performance since Fitch's last rating action. As of the March 2008 distribution date the pool has been reduced 18.5% to $651.3 million from $798.9 million at issuance. Twenty-six loans, 28.6% of the pool, have defeased. There are currently two assets (1.1%) in special servicing and losses are expected. The largest specially serviced asset (0.6%) is now real estate owned and is a multi-family building located in Austell, Georgia. Occupancy was 79% at year end (YE) 2007 as a result of the special servicer evicting non-paying tenants. The other specially serviced loan (0.6%) is secured by a multi-family building located in Greenville, North Carolina and is in foreclosure. Losses are expected on both properties. However, they are anticipated to be fully absorbed by the NR class. Fitch reviewed the shadow rating of the Highland Mall loan (10.1%). The Highland Mall loan is secured by 487,170 square feet (sf) of a regional mall located in Austin, Texas. The Fitch stressed DSCR for YE 2006 was 1.45 times (x), up from 1.42x at YE 2005 and stable with issuance. Occupancy as of September 2007 was 91% compared to 97.3% at issuance. Due to its stable performance, the loan maintains an investment grade credit assessment. The DSCR for the loan is calculated using borrower provided net cash flow less required reserves divided by debt service payments based on the current balance using a Fitch stressed refinance constant. Twelve loans (8.6%) have been identified as Fitch Loans of Concern including specially serviced loans (1.1%) and ten other loans with declining performance. The largest non-specially serviced loan of concern (1.3%) is secured by an industrial or warehouse property in Morgan Hill, California. The most recent servicer reported debt service coverage ratio is 0.46x with occupancy of 39% as of June 2007, down from 100% at issuance. The deal does not contain any loans maturing in 2008 through 2010. KIMBALL HILL: Extends Waiver Pact with Lenders through April 11 --------------------------------------------------------------- Kimball Hill Homes extended a waiver agreement with its lender group through April 11, 2008. The waiver agreement was previously set to expire on March 14, 2008. As reported in the Troubled Company Reporter on March 17, 2008, two default notices were sent to Inspirada and Kyle Canyon Gateway, two large housing projects in Las Vegas and joint ventures involving Focus Property Group, Toll Brothers Inc., KB Home, Beazer Homes USA Inc., Pulte Homes Inc., The Ryland Group Inc., and Lennar Corp., according to Reuters and Bloomberg News, citing Focus officers, John Ritter, CEO, and Thomas DeVore, COO. WSJ relates that Kimball Hill Homes, one of Toll's partners, is part of the Inspirada development. During the extension period, Kimball Hill will continue active discussions with its lender group to formulate and implement a long-term solution to reposition the company in light of current challenges facing the homebuilding industry. "We are engaged in active discussions with our lenders and we appreciate their support to extend the current waiver agreement to help facilitate a long-term amendment," Kenneth Love, chief executive officer, said. "During this period, we expect to continue homebuilding operations as usual." About Kimball Hill Based in Rolling Meadows, Illinois, Kimball Hill Inc. -- http://www.kimballhillhomes.com/-- builds mid-priced single- family detached homes, townhomes, and condominiums under the name Kimball Hill Homes in various markets in 5 states: Texas, Florida, Illinois, Nevada and California. Subsidiary KH Financial offers mortgage financing and refinancing of investment properties in about half a dozen states. LAS VEGAS SANDS: Earns $116.6 Million in Year Ended Dec. 31, 2007 ----------------------------------------------------------------- Las Vegas Sands Corp. earned $116.6 million on total revenues of $3.1 billion for the year ended Dec. 31, 2007, compared to $442 million of net income on total revenues of $2.3 billion for the year ended Dec. 31, 2006. Net revenue for the fourth quarter of 2007 increased 64.8% to a record $1.05 billion, compared to $636.3 million in the fourth quarter of 2006. Consolidated adjusted property EBITDAR in the fourth quarter of 2007 came in at a record $296.3 million, an increase of 21.3%, compared to $244.3 million in the year-ago quarter. The decrease in operating income of $32.8 million was driven principally by increases in operating costs as the company expanded in its infrastructure to execute its global growth plans, as well as an increase of $46.7 million in depreciation and amortization expense, and an increase of $19.5 million in pre-opening expense related to our preparations for the opening of The Palazzo, which opened on December 30, and other properties to be opened in the future in Macao, Singapore, and the United States. Full-year 2007 net revenue increased 31.9% to $2.95 billion compared to $2.24 billion in 2006. Adjusted net income was $309.5 million in 2007. This compares to adjusted net income of $506.1 million, or adjusted earnings per diluted share of $1.42 in 2006. The decrease in adjusted net income of $196.6 million was driven principally by the full-year impact of the increased operating costs related to the execution of our global growth plans mentioned above and full-year pretax increases in depreciation and amortization expense of $91.8 million, and net interest expense of $102.7 million. Las Vegas Sands had total assets of $11.4 billion, $9.2 billion of total liabilities, and a stockholders' equity of $2.2 billion at Dec. 31, 2007, compared to total assets of $7.1 billion, total liabilities of $5.0 billion, and a stockholders' equity of $2.1 billion at Dec. 31, 2006. The company, at Dec. 31, 2007, had total current assets of $1.3 billion available to pay total current liabilities of $1.4 billion, resulting in a working capital deficit of $114 million. William P. Weidner, president and COO of the company, stated, "We are pleased with our fourth quarter operating results, which reflect the steady execution of our global growth strategy. In Asia, our efforts to transform Macao into Asia's premier business and leisure destination continue to bear fruit. The strong visitation to the Cotai Strip's anchor property, The Venetian Macao, and the strong performance of the property's hotel, entertainment, retail, gaming and group meeting businesses, reflect that we are delivering on the fundamental goal and commitment we share with the people of Macao, Hong Kong and all of Southern China - the transformation of Macao into Asia's premier business and leisure destination. "We remain confident, and our operating results confirm, that the execution of our development strategy for the Cotai Strip will deliver tremendous economic benefits to Macao and the entire region, as well as industry-leading returns to our shareholders. In Las Vegas, we opened The Palazzo, completing our master-plan of the largest integrated destination resort in the world and setting the stage for strong growth and industry-leading returns in the Las Vegas market for years to come. "Since opening on August 28th, we have now welcomed more than 9 million guests from around the region to Asia's first integrated destination resort, The Venetian Macao. Both business and leisure visitors have contributed to strong hotel rate and occupancy statistics, reflecting the strength of our product offering and the burgeoning interest from around the region in the world-class amenities of our integrated resort. In fact, more than 70% of visitors to Macao in the quarter ended December 31, 2007 visited The Venetian Macao and the Cotai Strip. "Our corporate meeting and convention businesses continue to expand, and are enjoying significant amounts of repeat business. Our entertainment offerings have been well received throughout the region, driving significant visitation to Macao, while our gaming volumes in both VIP and mass have been healthy, reflecting the strength in the expanding marketplace and the popularity and acceptance of our product offerings. "While we are clearly pleased with the positive reception that the people of Macao, Hong Kong, the People's Republic of China and the wider Asian region have given The Venetian Macao, we realize that we are only in the early stages of fulfilling our promise to Macao. The successful opening of The Venetian Macao is only the initial step in delivering on our commitment to lead the transformation of Macao into Asia's premier entertainment-based destination resort, and the leading host for trade shows and conventions in the region. We have much work ahead of us as we continue to partner with our constituencies in Macao, Hong Kong and the wider region to realize the vision of transforming Macao into Asia's premier business and leisure destination." About Las Vegas Sands Based in Las Veags, Nevada Las Vegas Sands Corp. (NYSE:LVS) -- http://www.lasvegassands.com/-- owns and operates The Venetian Resort-Hotel-Casino and the Sands Expo and Convention Center in Las Vegas and The Venetian Macao Resort-Hotel and the Sands Macao in the People's Republic of China Special Administrative Region of Macao. The company is constructing three additional integrated resorts: The Palazzo Resort-Hotel-Casino in Las Vegas; Sands Bethworks(TM) in Bethlehem, Pennsylvania; and The Marina Bay Sands(TM) in Singapore. LVS is also creating the Cotai Strip(TM), a master-planned development of resort-casino properties in Macao. Additionally, the companyis working with the Zhuhai Municipal People's Government of the PRC to master-plan the development of a leisure resort and convention complex on Hengqin Island in the PRC. * * * Las Vegas Sands Corp. still carries Standard & Poor's Ratings Services 'BB-' long-term foreign and local issuer credit ratings, which were placed on April 17, 2007. Rating outlook is stable. LEHMAN BROS: S&P Slashes Ratings on Class ASH-1 and ASH-2 Certs. ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class ASH-1 and ASH-2 commercial mortgage pass-through certificates issued by Lehman Bros. Floating Rate Commercial Mortgage Trust 2006-CCL C2 and removed them from CreditWatch, where they were placed with developing implications on Dec. 14, 2007. The other rated classes in this transaction are not affected by these actions. The lowered ratings reflect S&P's review of the Avalon at Seven Hills property operating performance, as well as S&P's analysis of its February 2008 appraisal. The Avalon is a 320-unit apartment complex in Henderson, Nevada, that is being converted into residential condominiums. Prior to the CreditWatch development placement of the ASH classes, unit sales and velocity had been in line with Standard & Poor's expectations. Towards the end of 2007, unit sales slowed significantly and based on S&P's most recent review, the sales have come to a halt. The borrower, reflecting current market conditions, has reduced unit asking prices. Based on a review of the February 2008 appraisal, S&P's does not expect the market for this product to turn around in the near term. The appraiser's (Cushman & Wakefield's) assumptions include more significant pricing discounts than are currently being offered at the property. Standard & Poor's expects unit sales to remain slow in 2008, and believes unit sale prices will likely not meet S&P's initial expectations. As a result, S&P expects loan principal reductions from condominium sales to be slower than originally anticipated. The Avalon loan is currently 60-plus-days delinquent. The raked ASH-1 and ASH-2 certificates are wholly dependant on Avalon's performance and derive 100% of their cash flows from the collateral that secures the loan. The two classes currently have a current total principal balance of $2.18 million, down from $4.52 million at issuance. Based on discussions with Trimont Real Estate Advisors, the special servicer, and after a review of the co-lender agreement, the B-2 note, which is outside of the trust, will be the first to absorb any liquidation or workout fees related to the Avalon loan. Ratings Lowered and Removed From CreditWatch Developing Lehman Bros. Floating Rate Commercial Mortgage Trust 2006-CCL C2 Commercial mortgage pass-through certificates Rating ------ Class To From ----- -- ---- ASH-1 BB BBB/Watch Dev ASH-2 BB- BBB-/Watch Dev LODGENET INTERACTIVE: S&P Gives Negative Outlook; Holds B+ Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on LodgeNet Interactive Corp. (formerly LodgeNet Entertainment Corp.) to negative from stable and affirmed the 'B+' corporate credit rating on the company. "The outlook revision is based on our concerns regarding the company's narrowing headroom under its progressively tightening financial covenants, particularly given unfavorable economic trends," explained Standard & Poor's credit analyst Tulip Lim. For the year ended Dec. 31, 2007, LodgeNet had outstanding debt of $624.6 million. The ratings reflect the in-room entertainment provider's exposure to the cyclical and seasonal lodging industry, S&P's expectation that the company's substantial capital spending will continue to limit its discretionary cash flow, and the limited size and long- term growth potential of this market niche. LodgeNet's operating results are subject to the discretionary nature of traveler purchases and the unpredictable quality of movies, which generate the majority of room revenue. Partially offsetting these risks are the company's leading position in this market niche, its good EBITDA margins, and the relative stability that its long-term noncancellable hotel property contracts provide. MACY'S INC: Extends License Contract with Finlay Enterprises ------------------------------------------------------------ Finlay Enterprises Inc. signed a two-year extension of its license agreement with Macy's Central, a division of Macy's Inc. The amended license agreement extends the company's contract until Jan. 29, 2011. Macy's Central will consist of 222 doors after the completion of the divisional consolidation of Macy's Inc. The divisional consolidation will result in the merging of the former Macy's Midwest and Macy's South divisions. As reported in the Troubled Company Reporter on February 7, 2008, Macy's disclosed new initiatives, including consolidation of three Macy's divisions, to enable the company to both accelerate same- store sales growth and reduce expense. Macy's consolidated its Minneapolis-based Macy's North organization into New York-based Macy's East, its St. Louis-based Macy's Midwest organization into Atlanta-based Macy's South and its Seattle-based Macy's Northwest organization into San Francisco-based Macy's West. The Atlanta-based division was renamed Macy's Central. All store locations remained in place. The consolidation of divisional central office organizations, is expected to be completed in the second quarter of 2008, and would affect roughly 2,500 jobs. Macy's Miami-based Macy's Florida and New-York based Bloomingdale's divisions are not affected. About Finlay Enterprises Headquartered in New York City, Finlay Enterprises Inc. (Nasdaq: FNLY) -- http://www.finlayenterprises.com/-- through its wholly owned subsidiary, Finlay Fine Jewelry Corporation, retails fine jewelry and operates luxury stand-alone specialty jewelry stores primarily located in the southeastern United States and licensed fine jewelry departments in department stores throughout the United States. The number of locations at the end of fiscal 2007 totaled 794, including 69 Bailey Banks & Biddle, 32 Carlyle and five Congress specialty jewelry stores. * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Standard & Poor's Ratings Services said that the closure of 94 stores due to the consolidation of Macy's divisions will have no immediate impact on Finlay Enterprises' (Finlay; B-/Negative/--) rating or outlook. About Macy's Inc. Based in Cincinnati and New York, Macy's Inc. (NYSE: M) fka Federated Department Stores Inc. -- http://www.fds.com/-- is one of the nation's premier retailers. The company operates more than 850 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy's and Bloomingdale's. The company also operates macys.com, bloomingdales.com and Bloomingdale's By Mail. * * * As reported in the Troubled Company Reporter on Oct. 23, 2007, Moody's Investors Service affirmed all ratings of Macy's Inc., including its long term rating of Baa2, Prime 2 short term rating, and (P)Ba1 Preferred shelf rating but changed the outlook to negative from stable. The change in outlook was prompted by the continuing negative comparable store sales in the former May doors, credit metrics that are at the trigger points cited in Moody's Credit Opinion of Feb. 28, 2007, for a downgrade, and the uncertain outlook on consumer spending that could further delay improvement in the former May stores' performance. METRO ONE: Appoints James Hensel as President and Board Director ---------------------------------------------------------------- Metro One Telecommunications Inc. disclosed in a regulatory filing with the Securities and Exchange Commission dated March 14, 2008, that its Board of Directors has appointed James F. Hensel, the current chief executive officer of the company, to the Board. Mr. Hensel replaces Mr. Gary Henry who recently resigned. The Board also appointed Mr. Hensel on March 10, 2008, as president of the company, a position held by Mr. Henry prior to his resignation. Mr. Hensel, 50, was senior vice president at Columbia Ventures Corporation where, since 2005, he oversaw some of CVC's telecom and non-telecom investments in Ireland, Iceland, New Zealand, Australia and the United States. From 2002 through 2004, Mr. Hensel was the chief executive officer of HemCon, a Portland, Oregon based medical device company. Currently he serves on the board of several private companies and the Oregon Food Bank. Mr. Hensel holds a BA from Harvard University and a JD from Willamette University College of Law. Mr. Hensel will not receive additional compensation for service on the Board of Directors. Mr. Hensel will not receive compensation as president of the company in addition to that which he receives as the company's chief executive officer. About Metro One Based in Portland, Oregon, Metro One Telecommunications Inc. (Nasdaq: INFO) -- http://www.metro1.com/-- is a developer and provider of Enhanced Directory Assistance(R) and other information services. The company operates call centers located in the United States. Going Concern Doubt BDO Seidman LLP, in Seattle, expressed substantial doubt about Metro One Telecommunications 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 from operations and loss of significant customers. MICHAELS STORES: Feb. 2 Balance Sheet Upside Down by $2.892 Bil. ---------------------------------------------------------------- Michaels Stores Inc. reported a balance sheet data showing total assets of $1.616 billion, total liabilities of $4.508 billion resulting to a stockholders' deficit of $2.892 billion for Feb. 2, 2008. For the year, the company reported a net income decrease of $73 million from $41 million in fiscal 2006 to a net loss of $32 million in fiscal 2007. Fourth quarter ended Feb. 2, 2008 reported an increase in net income of $120 million to $53 million in fiscal 2007, primarily due to the absence of merger-related expenses, from a net loss of $67 million in fiscal 2006. Total sales for the quarter were $1.301 billion, a 4.4% decrease from fiscal 2006 fourth quarter sales of $1.361 billion, which was a 14 week quarter. The decrease in net sales for the quarter was primarily driven by a decrease in same-store sales of 3.4% and the absence of sales totaling $59 million for the extra week reported in fiscal 2006, offset by sales from new stores. Total sales for the year were $3.862 billion, an increase of 0.5% from $3.843 billion for the same period last year, which included the 53rd week. Same-store sales for the year decreased 0.7% from fiscal 2006. "Sales performance in the fourth quarter was below the company's expectations as customer traffic was softer than planned and Christmas and holiday categories underperformed," Brian Cornell, chief executive officer, said. "While discretionary spending was down significantly on higher ticket, seasonal items, we experienced solid performance in many of our core business lines." "In the face of a challenging fourth quarter sales environment, we continued to operate prudently," Mr. Cornell added. "Through aggressive efforts across the company, we were able to control costs, reduce our average store inventory levels and strengthen our financial position, with a reduction in our debt level of approximately $100 million since last year and nearly $400 million since our peak post-closing level." "Most importantly, we continued to make significant progress on our key strategic initiatives, particularly the global sourcing and consumer insights programs," Mr. Cornell concluded. "As a result, we are confident in our approach to drive long term profitable growth as we capitalize on significant margin enhancement opportunities and begin to transition into a more consumer focused organization." Operating income for the quarter increased to 15.4% of sales, from 3.1% in the fourth quarter of fiscal 2006. The increase was primarily due to the absence of $218 million in merger-related, transaction, and related party expenses in the prior year, partly offset by a $22 million goodwill impairment charge related to the company's Aaron Brothers business. For fiscal 2007, operating income as a percent of sales increased 380 basis points from 5.4% in fiscal 2006 to 9.2% in fiscal 2007. The increase was primarily due to the absence of significant merger-related expenses. The company's cash balance at the end of fiscal 2007 was $29 million, a decrease of $1 million from last year's ending balance of $30 million. For the year, net cash provided by operating activities was up $111 million to $268 million versus $157 million for fiscal 2006. Capital spending for fiscal 2007 was down $43 million, to $100 million versus $143 million in the prior year. Fiscal 2007 capital expenditures included $53 million attributable to real estate activities and $18 million for distribution network expenses, including the new Centralia, Washington distribution center. Year-end debt level totaled $3.863 billion, down $96 million from the ending balance for fiscal 2006 and $392 million lower than the peak post, closing borrowing level of $4.255 billion on Nov. 9, 2006. During the year, the company made $24 million in quarterly amortization payments and executed a repricing amendment on its Senior secured term loan. During fiscal 2007, the company opened 45 new stores, relocated 11 stores, and closed three stores under the Michaels banner and it also opened two and closed two Aaron Brothers stores. In addition, the company closed its 11 recollections and three star decorators' wholesale locations and all data relating to prior years have been adjusted to reflect the discontinued operations of these two concept businesses. The Troubled Company Reporter reported on Dec. 4, 2007 that at Nov. 3, 2007, the company's balance sheet showed total assets of $1.95 billion, total liabilities of $4.89 billion, resulting to a shareholders' deficit of $2.94 billion. About Michael's Stores Headquartered in Inving, Texas, Michaels Stores Inc. (NA: MIK) -- http://www.michaels.com/-- is a specialty retailer of arts, crafts, framing, floral, wall decor, and seasonal merchandise for the hobbyist and do-it-yourself home decorator. As of Nov. 28, 2007, the company owns and operates 964 Michaels stores in 48 states and Canada, 168 Aaron Brothers stores, 11 Recollections stores, and four Star Wholesale operations. About Michael's Stores Headquartered in Inving, Texas, Michaels Stores Inc. (NA: MIK) -- http://www.michaels.com/-- is a specialty retailer of arts, crafts, framing, floral, wall decor, and seasonal merchandise for the hobbyist and do-it-yourself home decorator. As of Nov. 28, 2007, the company owns and operates 964 Michaels stores in 48 states and Canada, 168 Aaron Brothers stores, 11 Recollections stores, and four Star Wholesale operations. ML-CFC COMMERCIAL: Fitch Confirms Low-B Ratings on Four Certs. -------------------------------------------------------------- Fitch Ratings affirmed ML-CFC Commercial Mortgage Trust's commercial mortgage pass-through certificates, series 2007-5: -- $74.8 million class A-1 at 'AAA'; -- $63.3 million class A-2 at 'AAA'; -- $60 million class A-2FL at 'AAA'; -- $153.4 million class A-3 at 'AAA'; -- $187.1 million class A-SB at 'AAA'; -- $1.090 billion class A-4 at 'AAA'; -- $245 million class A-4FL at 'AAA'; -- $1.205 billion class A-1A at 'AAA'; -- $341.7 million class AM at 'AAA'; -- $100 million class AM-FL at 'AAA'; -- $211.5 million class AJ at 'AAA'; -- $175 million class AJ-FL at 'AAA'; -- Interest-only class X at 'AAA'; -- $77.3 million class B at 'AA'; -- $33.1 million class C at 'AA-'; -- $77.3 million class D at 'A'; -- $38.6 million class E at 'A-'; -- $55.2 million class F at 'BBB+'; -- $49.7 million class G at 'BBB'; -- $49.7 million class H at 'BBB-'; -- $16.6 million class J at 'BB+'. -- $11 million class K at 'BB'; -- $11 million class L at 'BB-'; -- $5.5 million class N at 'B'. Fitch does not rate the $11 million class M, $11 million class P or $49.7 million class Q certificates. The affirmations reflect stable performance and minimal pay down since issuance. As of the March 2008 distribution date, the pool's aggregate certificate balance has decreased 0.3% to $4.402 billion from $4.417 billion at issuance. Three loans (0.5%) are currently in special servicing. Fitch's expected losses will be absorbed by the non-rated class Q. The largest specially serviced loan (0.3%) is secured by an office property in Orlando, FL. The loan transferred to the special servicer on Oct. 2, 2007, due to imminent default. The borrower has brought the loan current and a forbearance agreement has been executed. The second largest specially serviced loan (0.1%) is secured by a retail property in Sarasota, FL, and is 90 days delinquent. The special servicer is pursuing foreclosure. The third specially serviced loan (0.1%) is secured by a hotel property in Hampton, VA, and is 90 days delinquent. The special servicer is pursuing foreclosure. Fitch reviewed the most recent servicer provided operating statement analysis reports for the three shadow rated loans: Peter Cooper Village and Stuyvesant Town (18.2%), OMNI Portoflio (1%) and FRIS Chicken Portfolio (0.5%). Based on their stable performance since issuance the loans maintain their investment grade shadow ratings. Peter Cooper Village and Stuyvesant Town (18.2%) is a multifamily property comprised of 56 multistory buildings with a total of 11,227 residential apartments in Manhattan, New York. In addition to the residential component, the complex contains approximately 100,000 square feet (sf) of retail space, 20,000 sf of professional office space, and six parking garages with 2,260 licensed spaces. The property benefits from the strong sponsorship of Tishman Speyer Properties, LP and Blackrock Realty. At issuance, approximately 73% of the apartments were rent stabilized. As of Feb. 15, 2008, occupancy is 92.7% compared to 98.3% at issuance. The sponsor is in the process of converting the stabilized units to market rate rents as they become vacant, or if criteria established by the State of New York involving the legal rental rate level and occupant income levels are met. The borrower is expected to spend approximately $125 million in capital expenditures, financed through amounts on deposit in the general reserve which has a current balance of $91.7 million. In addition, the lenders have reserved $650 million to cover debt service shortfalls, conversion costs, capital expenditures, and operating expenses during the term of the loan. The trust portion represents an $800 million pari passu piece of the entire $3 billion A-note. There is an additional $1.5 billion of mezzanine debt outside the trust. OMNI Portfolio (1%) is secured by three cross-collateralized and cross-defaulted healthcare properties totaling 607 beds located in Irvington, Jersey City and Union City, New Jersey. The properties benefit from the experienced sponsorship of Avery Eisenreich, an owner, operator and developer of health care facilities in New Jersey. As of Sept. 30, 2007, occupancy has remained stable at 96.8% compared to 97.7% at issuance. FRIS Chicken Portfolio (0.5%) is secured by 192 Church's Chicken quick service restaurants that are subject to one master lease and are located in various cities throughout 12 states. Of the 192 units, 169 are occupied and operated by the tenant (Cajun Operating Company), while the remaining 23 units are subleased by the tenant to various Church's Chicken franchisees that perform the restaurant operations at each of the units. As of Sept. 26, 2007, the properties remain 100% occupied since issuance. MORGAN STANLEY: Fitch Gives Low-B Ratings on Five Cert. Classes --------------------------------------------------------------- Fitch Ratings affirmed these Morgan Stanley Dean Witter Capital I Trust's commercial mortgage pass-through certificates, series 2001-TOP3: -- $597.9 million class A-4 at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- $30.8 million class B at 'AAA'; -- $28.3 million class C at 'AA+'; -- $12.9 million class D at 'AA-'; -- $18 million class E at 'A-'; -- $11.6 million class F at 'BBB+'; -- $11.6 million class G at 'BBB-'; -- $10.3 million class H to 'BB'; -- $9 million class J at 'BB-'; -- $3.9 million class K at 'B+'; -- $5.1 million class L at 'B'; -- $2.6 million class M at 'B-'. Fitch does not rate the $8.8 million class N certificates. The class A-1, A-2 and A-3 certificates have been paid in full. The affirmations reflect stable performance since the last Fitch ratings action. As of the March 2008 distribution date, the pool has paid down 27% to $750.6 million from $1.03 billion at issuance. In addition, 17 loans (14.9%) have defeased, including two of the top ten loans (7.1%). One loan is specially serviced (1.3%) and is current. The loan is secured by six two-story office buildings in Grand Rapids, Michigan. The loan was transferred to the special servicer in March 2007 for monetary default and losses are possible. The non- rated class N is sufficient to absorb anticipated losses. Fitch reviewed the shadow rating of the Federal Plaza loan (4.5%), the second largest loan in the transaction. Based on stable performance and amortization, the loan maintains an investment grade shadow rating. Occupancy as of September 2007 was 100%. The Fitch stressed debt service coverage ratio as of year end 2006 was 1.80 times, an increase from 1.45x at issuance. The DSCR is calculated using servicer provided net operating income less reserves and capital expenditures divided by a Fitch stressed debt service. The largest loan in the pool (7%) is secured by an office property in Needham, Massachusetts. Occupancy as of June 2007 was 100% and the property has performed well since issuance. Servicer reported year-end 2006 net operating income was up 18.8% since issuance. MORGAN STANLEY: Fitch Rates $6.0 Mil. Class L Certs. at 'BB-' ------------------------------------------------------------- Fitch Ratings affirms Morgan Stanley Capital I Inc.'s commercial mortgage pass-through certificates, series 1999-CAM1: -- $60.6 million class A-4 at 'AAA'; -- Interest only class X at 'AAA'; -- $26.2 million class B at 'AAA'; -- $26.2 million class C at 'AAA'; -- $12.1 million class D at 'AAA'; -- $20.2 million class E at 'AAA'; -- $8.1 million class F at 'AAA'; -- $14.1 million class G at 'AA+'; -- $14.1 million class H at 'A+'; -- $6.0 million class J at 'BBB+'; -- $8.1 million class K at 'BBB-'; -- $6.0 million class L at 'BB-'; -- $6.0 million class M at 'B-/DR1'; -- $852,190 class N at 'C/DR6'. Classes A-1, A-2, and A-3 have paid in full. The affirmation is the result of stable performance since Fitch's last rating action. As of the March 2008 distribution date, the transaction's aggregate principal balance has been reduced 74.1% to $208.6 million from $806.5 million at issuance. The largest remaining loan (7.1%) is secured by a retail property in Escondido, California. September 2007 servicer reported occupancy was 99% and a debt service coverage ratio of 2.26 times. The loan is scheduled to mature in June 2009. The second largest loan (6.7%) is collateralized by an office property in midtown Manhattan. March 2007 servicer reported occupancy was 98%. The loan is scheduled to mature in January 2009. Eight loans (17%) have been identified as Fitch loans of concern due to declines in occupancy and performance, including two (8.8%) of the top five loans in the deal. There are currently no delinquent or specially serviced loans. The largest Fitch loan of concern (4.4%) is secured by a retail property in St. Peters, Missouri uffering from a decline in occupancy. January 2008 reported occupancy is 75.2% and the borrower is actively marketing the vacant space. The second largest Fitch loan of concern (4.4%) is secured by a multi-family property in Fort Collins, Colorado and is also suffering from a decline in occupancy. The last reported occupancy is 61.7% as of February 2007. Fitch continues to monitor upcoming maturities, with 9.9% of the pool scheduled to mature in 2008 and 45.4% in 2009. These loans have a weighted average coupon of 7.198% and 7.207%. MOST HOME: January 31 Balance Sheet Upside-Down by $1,505,823 ------------------------------------------------------------- Most Home Corp.'s consolidated balance sheet at Jan. 31, 2008, showed $1,469,420 in total assets and $2,975,243 in total liabilities, resulting in a $1,505,823 total stockholders' deficit. At Jan. 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $312,855 in total current assets available to pay $2,971,587 in total current liabilities. The company reported a net loss of $632,023 on net revenues of $513,856 for the second quarter ended Jan. 31, 2008, compared with a net loss of $1,391,481 on net sales of $470,988 in the same period ended Jan. 31, 2007. Gross margin for the three months ended Jan. 31, 2008, was $339,429 (66.1%) compared to $257,341 (54.6%) for the comparable quarter ended Jan. 31, 2007. Selling, general and administrative costs decreased 58.0% ($846,343) from the three months ended Jan. 31, 2007. The main factor for this decrease was non-cash stock compensation for the issuance and extension of stock options and warrants, recorded in the three month period ending Jan. 31, 2007, and a headcount reduction, included in SG&A, of 6 people during fiscal 2007. Interest expense increased to $141,401 during the three months ended Jan. 31, 2008, compared with $40,627 during the three months ended Jan. 31, 2007. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?295f Going Concern Doubt Manning Elliott LLP, in Vancouver, Canada, expressed substantial doubt about Most Home Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended July 31, 2007, and 2006. The auditing firm reported that the company has a working capital deficiency and has incurred recurring losses from operations. About Most Home Headquartered in Maple Ridge, British Columbia, Canada, Most Home Corp. (OTC BB: MHME.OB) -- http://www.mosthome.com/-- is a real estate services company providing technology solutions for agents, brokers and real estate franchises. MOVIE GALLERY: Seeks Permission to Reject Dotcast License Pact -------------------------------------------------------------- Movie Gallery Inc. and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Eastern District of Virginia to reject their license agreement with Dotcast, Inc., in light of a settlement agreement reached between the parties. In March 2007, Buena Vista Datacasting, LLC and debtor-affiliate M.G. Digital, L.L.C., entered into a certain assignment and assumption agreement, which, according to the Debtors, was the License Agreement that Buena Vista previously had with Dotcast. Subsequently, Dotcast commenced Civil Action No. 1:07-CV-01181- ODE against the Debtors in the United States District Court for the Northern District of Georgia, styled Dotcast, Inc. v. Movie Gallery, Inc., M.G. Digital, LLC, and Movie Gallery US, LLC., asserting that the Debtors "have infringed and are infringing" US Patent No. 6,433,835 through selling, offering for sale and importing a video distribution service known as MovieBeam (TM). Pursuant to Section 638 of the California Code of Civil Procedure, M.G. Digital initiated Civil Case No. BC375557 against Dotcast in the Superior Court of the State of California, County of Los Angeles, styled as M.G. Digital, LLC v. Dotcast, Inc., et al., seeking declaratory relief and specific performance based upon the contention that it is a valid assignee of certain rights under the License Agreement. In an effort to resolve their dispute, the Debtors and Dotcast entered into a settlement agreement which provides for, among other things: * the rejection of the License Agreement; * the Debtors' and Dotcast's mutual release and discharge of claims in the Georgia Action and the Section 638 Action; * the parties' withdrawal of claims filed prior to the effective date of the Settlement Agreement, following which Dotcast will forever refrain from filing any claims in the Debtors' bankruptcy cases; * the Debtors' avoidance of usage of certain "dNTSC" modulators and receiver chips absent Dotcast's written permission; and * the parties' voluntary dismissal of their initiated litigations within seven days after the Effective Date of the Settlement Agreement. Representing the Debtors, Loc Pfeiffer, Esq., at Kutak Rock LLP, in Richmond, Virginia, maintains that the Debtors no longer require the benefits provided by the License Agreement and the License Agreement does not represent source of potential value for the Debtors' creditors and future operations. In contrast, the Settlement Agreement represents a compromise that "significantly avoids the cost, delay and uncertainty related to further litigation in connection with the License Agreement," Mr. Pfeiffer adds. 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. 22; Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/ or 215/945-7000) NATIONAL LAMPOON: Jan. 31 Balance Sheet Upside-Down by $4,644,014 ----------------------------------------------------------------- National Lampoon Inc.'s consolidated balance sheet at Jan. 31, 2008, showed $9,395,336 in total assets and $14,039,350 in total liabilities, resulting in a $4,644,014 total stockholders' deficit. At Jan. 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $1,520,503 in total current assets available to pay $10,011,145 in total current liabilities. The company reported a net loss of $850,959 on revenues of $503,173 for the second quarter of fiscal year 2008, compared to a net loss of $1,742,679 on revenues of $987,388 for the second quarter of fiscal year 2007. The net loss for the second quarter of fiscal year 2008 includes non-cash costs associated with option and stock grants. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?2952 Going Concern Doubt Weinberg & company P.A., in Los Angeles, epxressed substantial doubt about National Lampoon Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended July 31, 2007. The auditing firm pointed to the company's working capital deficiency of $7,196,255 and accumulated deficit of $41,257,284 as of July 31, 2007, and a net loss of $2,504,170 for the year ended July 31, 2007. About National Lampoon Based in West Hollywood, California, National Lampoon Inc. (AMEX: NLN) -- http://www.nationallampoon.com/-- is active in a broad array of media and entertainment segments. These include feature films, television programming, online and interactive entertainment, home video, audio, and book publishing. The company also owns interests in all major National Lampoon properties, including National Lampoon's Animal House, the National Lampoon Vacation series and National Lampoon's Van Wilder. NEW CENTURY: Court Approves Amended Disclosure Statement -------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware approved the Disclosure Statement, which explains the First Amended Joint Chapter 11 Plan of Liquidation dated as of March 18, 2008, of New Century Financial Corporation and its debtor-affiliates, and co-proposed by the Debtors and the Official Committee of Unsecured Creditors. Judge Carey found that the Disclosure Statement contained adequate information within the meaning of Section 1125 of the Bankruptcy Code, to enable creditors to make an informed decision on whether to accept or reject the Plan. Judge Carey will hold a hearing on April 24, 2008, at 1:00 p.m. (ET), to consider confirmation of the Plan. Objections to the Plan, if any, are due at 4:00 p.m., on April 18. The Court authorized the Debtors to send copies of the Amended Plan and Disclosure Statement and other related documents to claimants entitled to vote on the Amended Plan and certain other notice parties. The Debtors are also permitted to make non- substantive conforming changes to the Plan, the Disclosure Statement, and related solicitation documents and forms prior to solicitation. Judge Carey also approved the schedule for the voting, tabulation, and confirmation process of the Debtors' and the Committee's First Amended Joint Chapter 11 Plan of Liquidation: March 10, 2008 -- Record Date to determine creditors and interest holders entitled to receive Solicitation Packages and vote to accept or reject the Plan and Solicitation Package Mailing Date April 21, 2008 -- Voting Deadline April 18, 2008 -- Plan Confirmation Objection Deadline April 24, 2008 -- Plan Confirmation Hearing Solicitation Packages will include the Confirmation Hearing Notice, the Amended Disclosure Statement and its exhibits, an appropriate form of Ballot and a Ballot return envelope, a copy of the EPD/Breach Claim Protocol (for claimholders in Classes OP3b and OP6b), or a notice of non-voting status (for Holders of Claims in the Non-Voting Classes). The ballots, substantially based on Official Form No. 14 and modified to include certain additional appropriate and relevant information for the voting class, will be distributed to holders of claims in Classes HC3a, HC3b, HC7, HC10a, HC13, OP3a, OP33b, OP3c, OP6a, OP6b, OP6c, OP9a, OP9b, OP12, and AL3. The Court ruled that that each claim in the Voting Classes be temporarily allowed, solely for the purpose of voting on the Plan. The Debtors will send a notice of non-voting status to holders of claims in Classes HC1, HC2, HC4a, HC4b, HC4c, HC4d, and HC4e, HC5, HC6, HC8, HC9, HC11, HC12, OP1, OP2, OP5, OP7, OP8, OP10, OP11, AL1, and AL2, as well as Holders of Record of NCFC Interests, and holders of 510(b) Claims in the non-voting classes. All voting classes will send their ballots to the Debtors' balloting agent, XRoads Case Management Services, LLC. Xroads is expected to file with the Court the voting results on the Plan on April 23, 2008. About New Century Founded in 1995, Irvine, Calif.-based New Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real estate investment trust, providing mortgage products to borrowers nationwide through its operating subsidiaries, New Century Mortgage Corporation and Home123 Corporation. The company offers a broad range of mortgage products designed to meet the needs of all borrowers. The company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2007 (Bankr. D. Del. Lead Case No. 07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins, Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., represent the Debtors. The Official Committee of Unsecured Creditors selected Hahn & Hessen as its bankruptcy counsel and Blank Rome LLP as its co-counsel. When the Debtors filed for bankruptcy, they listed total assets of $36,276,815 and total debts of $102,503,950. The Debtors' exclusive period to file a plan expired on Jan. 28, 2008. (New Century Bankruptcy News, Issue No. 35; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). NEW CENTURY: Various Parties Get Court OK to Initiate Foreclosure ----------------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware lifted the automatic stay with respect to several holders of promissory notes so they can exercise their rights against certain parcels of real property in which New Century Financial Corporation or its debtor-affiliates may hold a junior lien: * America's Servicing Company; * Avelo Mortgage LLC; * Consumer Solutions, LLC; * Countrywide Bank, F.S.B.; * Countrywide Home Loans, Inc.; * Countrywide Home Loans Servicing LP, or the benefit of HSBC Bank USA, N.A.; * Deutsche Bank Trust Company Americas, as trustee for the holders of GSAA Home Equity Trust Asset-Backed Certificates; * Deutsche Bank Trust Company Americas, as trustee and custodian for HSBC Bank USA, N.A.; * Deutsche Bank Trust Company Americas, formerly known as Banker's Trust Company, as trustee and custodian for IXIS; * Deutsche Bank Trust Company Americas, formerly known as Banker's Trust Company, as trustee and custodian for Morgan Stanley and Morgan Stanley ABS Capital I, Inc. Trust Mortgage Pass-Through Certificates; * Deutsche Bank Trust Company Americas, as trustee MSAC; * Deutsche Bank Trust Company Americas, formerly known as Banker's Trust Company, as trustee and custodian for MSIX; * Deutsche Bank Trust Company Americas, as trustee for the holders of New Century Home Equity Loan Trust Asset-Backed Pass-Through Certificates; * DLJ Mortgage Capital, Inc., c/o Select Portfolio Servicing, Inc.; * Fidelity Bank; * Frannie Mae, c/o Saxon Mortgage Services, Inc.; * FV-I, Inc.; * GS Conduit Loans, c/o Avelo Mortgage Corporation; * HSBC Bank USA, National Association, for the benefit of Ace Securities Corp. Home Equity Loan Trust Asset-Backed Pass- Through Certificates; * HSBC Bank USA, National Association, as trustee and on behalf of the holders of the Nomura Home Equity Loan, Inc., Asset-Backed Certiicates, c/o Select Portfolio Servicing, Inc.; * HSBC Bank USA, N.A., c/o Select Portfolio Servicing, Inc.; * IMC 97-7 Refci Co., c/o Select Portfolio Servicing, Inc.; * LaSalle Bank National Association, as trustee and custodian for Morgan Stanley; * Mortgage Electronic Registration Systems, Inc., c/o Aurora Loan Services LLC; * Regions Mortgage, Inc.; * Residential Capital, LLC; * Saxon Mortgage Services, Inc.; * The Bank of New York, as trustee for the certificate holders of CWALT INC. Alternative Loan Trust; * UBS AG, Tampa Branch, doing business as UBS Special Servicing Group; * UBS Real Estate Securities, Inc., c/o Select Portfolio Servicing, Inc.; * U.S. Bank National Association, as trustee and on behalf of the holders of the Asset-Backed Securities Corporation Home Equity Loan Trust, c/o Select Portfolio Servicing, Inc.; * U.S. Bank National Association, as trustee of CSFB ABSC Trust Series, c/o Select Portfolio Servicing, Inc.; * U.S. Bank National Association, as trustee for Harborview Trust Fund; * U.S. Bank National Association, as trustee for Home Equity Loan Trust; * U.S. Bank National Association, as trustee for MASTR Adjustable Rate Mortgage Trust; * Wells Fargo Bank, N.A., as trustee; and * Wilshire Credit Corporation. By separate pleadings, the holders have asked the Court to lift the automatic stay so they can exercise their rights against certain parcels of real property. The holders explained that a number of people borrowed money from certain lenders by executing promissory notes. To secure the repayment of the sums due under the Notes, the obligors executed and delivered to the lenders mortgages, deeds of trust, or comparable instrument of security on certain parcels of real property. The mortgage and note were later transferred to other parties. The holders said the obligors are in default under the Notes and the holders intend to exercise their non-bankruptcy rights and remedies with respect to the Notes, including but not limited to the foreclosure of the Mortgages. The holders asserted that because the Debtors' junior mortgages are subordinate to the Mortgages, the Debtors have no equity in the Properties. They added that their claims against the Property may be equal to or may exceed the value of the Properties. Because the Debtors' junior mortgages add little or no value to the bankruptcy estate, the Property is not necessary for the Debtors' reorganization, they said. The holders argued that their interests in the Properties are not adequately protected, thus termination of the automatic stay is warranted. About New Century Founded in 1995, Irvine, Calif.-based New Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real estate investment trust, providing mortgage products to borrowers nationwide through its operating subsidiaries, New Century Mortgage Corporation and Home123 Corporation. The company offers a broad range of mortgage products designed to meet the needs of all borrowers. The company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2007 (Bankr. D. Del. Lead Case No. 07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins, Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., represent the Debtors. The Official Committee of Unsecured Creditors selected Hahn & Hessen as its bankruptcy counsel and Blank Rome LLP as its co-counsel. When the Debtors filed for bankruptcy, they listed total assets of $36,276,815 and total debts of $102,503,950. The Debtors' exclusive period to file a plan expired on Jan. 28, 2008. (New Century Bankruptcy News, Issue No. 35; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). NOMURA TRUSTS: Higher Delinquencies Cues Moody's 100 Rating Cuts ---------------------------------------------------------------- Moody's Investors Service downgraded the ratings of 100 tranches from 17 transactions issued by Nomura. Fifty one downgraded tranches remain on review for possible further downgrade. Additionally, 93 tranches were placed on review for possible downgrade. The collateral backing these transactions consists primarily of first-lien, fixed and adjustable-rate, Alt-A mortgage loans. The ratings were downgraded or placed on review for possible downgrade, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. The actions described below are a result of Moody's on-going review process. Issuer: Nomura Asset Acceptance Corporation Alternative Loan Trust, Series 2005-AP3 -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-IO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Baa1 from Aa2 -- Cl. M-2, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2005-AR4 -- Cl. I-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from A1; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa2 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Caa3 from Baa3; Placed Under Review for further Possible Downgrade Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2005-AR5 -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa2 -- Cl. M-2, Downgraded to B3 from A1; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Caa3 from Baa2; Placed Under Review for further Possible Downgrade Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2005-AR6 -- Cl. I-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from B2 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AF1 -- Cl. I-A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-1B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-IO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to Ca from Ba2 -- Cl. I-M-3, Downgraded to Ca from Caa2 -- Cl. C-B-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. C-B-2, Downgraded to Ca from B2 -- Cl. C-B-3, Downgraded to Ca from Caa3 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AF2 -- Cl. I-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to Ca from B2 -- Cl. V-M-1, Downgraded to Caa1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. V-M-2, Downgraded to Caa2 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. V-M-3, Downgraded to Ca from Ba2 -- Cl. V-M-4, Downgraded to Ca from B2 -- Cl. V-M-5, Downgraded to Ca from Caa3 -- Cl. C-B-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. C-B-2, Downgraded to Ca from B2 -- Cl. C-B-3, Downgraded to Ca from Caa2 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AP1 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-IO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from B3 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR1 -- Cl. I-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-X, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. IV-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. V-M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. V-M-2, Downgraded to Caa1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. V-M-3, Downgraded to Ca from Ba3 -- Cl. B-1, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. B-2, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. B-3, Downgraded to Ca from B3 -- Cl. B-4, Downgraded to Ca from Caa3 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR2 -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-X, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. III-M-1, Downgraded to Caa1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. III-M-2, Downgraded to Caa1 from A3; Placed Under Review for further Possible Downgrade -- Cl. III-M-3, Downgraded to Ca from Ba1 -- Cl. III-M-4, Downgraded to Ca from B2 -- Cl. C-B-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. C-B-2, Downgraded to Ca from B1 -- Cl. C-B-3, Downgraded to Ca from Caa2 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR3 -- Cl. A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Caa1 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Ca from Ba3 -- Cl. M-5, Downgraded to Ca from B2 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR4 -- Cl. A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Caa1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Caa1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Ca from Ba3 -- Cl. M-6, Downgraded to Ca from Caa1 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-WF1 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-6, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba2 from Aa2 -- Cl. M-2, Downgraded to B2 from A2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Ca from Ba3 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2007-1 -- Cl. I-A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-1B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to B1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to B1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to Ca from B1 -- Cl. I-M-4, Downgraded to Ca from B3 -- Cl. I-M-5, Downgraded to Ca from Caa2 -- Cl. I-M-6, Downgraded to Ca from Caa3 -- Cl. II-M-1, Downgraded to B3 from Aa1; Placed Under Review for further Possible Downgrade -- Cl. II-M-2, Downgraded to Caa1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. II-M-3, Downgraded to Caa1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-4, Downgraded to Ca from B3 -- Cl. II-M-5, Downgraded to Ca from Caa1 -- Cl. II-M-6, Downgraded to Ca from Caa2 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2007-2 -- Cl. A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Ca from Ba2 -- Cl. M-3, Downgraded to Ca from B2 -- Cl. M-4, Downgraded to Ca from Caa2 -- Cl. M-5, Downgraded to Ca from Caa3 Issuer: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2007-3 -- Cl. M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Ca from B3 -- Cl. M-3, Downgraded to Ca from Caa2 -- Cl. M-4, Downgraded to Ca from Caa3 Issuer: Nomura Home Equity Loan, Inc. Home Equity Loan Trust, Series 2006-AF1 -- Cl. A-1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from B2 Issuer: Nomura Home Equity Loan, Inc. Home Equity Loan Trust, Series 2007-1 -- Cl. I-M-1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-2, Downgraded to Ca from B1 -- Cl. I-M-3, Downgraded to Ca from Caa3 -- Cl. II-M-1, Downgraded to Caa1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. II-M-2, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-3, Downgraded to Caa3 from Ba3 -- Cl. II-M-4, Downgraded to Ca from Caa2 NORTHWEST AIRLINES: Staff Not Protected by AMFA, Teamsters Says --------------------------------------------------------------- The Teamsters Union said that the Aircraft Mechanics Fraternal Association failed to protect mechanics' jobs at United Airlines Inc., Northwest Airlines Corp. and Alaska Airlines Inc. AMFA also misrepresented conditions at Teamster airlines. Continental Airlines Inc. outsourced jobs before the Teamsters were elected to represent mechanics at that airline. The number of mechanics and related at Continental increased to 3,605 last year from 3,050 in 1998, when the Teamsters became the mechanics' representative. Continental's furlough list has been exhausted and new mechanics have been hired. In contrast, 3,289 mechanics and related lost their jobs at United between 2003 and 2006 while they were represented by AMFA. United has cut more maintenance workers than any other U.S. airline. Additionally, thousands of mechanics lost their jobs at other AMFA-represented carriers, including Alaska and Northwest airlines. "Anyone who's seen what happened at United, or watched mechanics marched off the cliff at Northwest Airlines, understands that AMFA has to resort to lies to hang on to the members it has left," said Teamsters General President Jim Hoffa. Despite AMFA claims, there has been no job loss at Teamster- represented carriers. United Airline mechanics are in the midst of voting to switch representation to the Teamsters from AMFA. The voting period ends March 31. Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico. There are 40,000 Teamsters airline employees, including more than 9,000 mechanics and related at 11 airlines. About Alaska Airlines Headquartered in Seattle, Washington, Alaska Airlines Inc. -- http://alaskaair.com/-- is a wholly owned subsidiary of Alaska Air Group Inc. (NYSE: ALK). Air Group is also the parent company of Horizon Air Industries Inc. and Alaska Air Group Leasing. Alaska Airlines and Horizon Air together serve 92 cities through an expansive network in Alaska, the Lower 48, Hawaii, Canada and Mexico. 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. About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents, including Italy, Spain, Japan, China, Venezuela and Argentina. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. (Northwest Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). OCCULOGIX INC: Ernst & Young Issues Going Concern Opinion --------------------------------------------------------- Ernst & Young LLP raised substantial doubt about OccuLogix, Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2007, and 2006. The auditing firm pointed to the company's recurring operating losses and working capital deficiency. For the year ended Dec. 31, 2007, the company posted a net loss of $68,139,314 on total revenues of $91,500, as compared with a net loss of $82,184,503 on total revenues of $174,259. At Dec. 31, 2007, the company's balance sheet showed $9,998,360 in total assets, $4,099,072 in total liabilities, and $5,899,288 in total stockholders' equity. The company's balance sheet at Dec. 31, 2007, showed strained liquidity with $3,102,210 in total current assets available to pay $4,099,072 in total current liabilities. $3,000,000 Bridge Loan On Feb. 19, 2008, the company secured a bridge loan in an aggregate principal amount of $3,000,000 (less transaction costs of approximately $200,000) from a number of private parties. The loan bears interest at 12% per annum and has a 180-day term, which may be extended to 270 days under certain circumstances. The company has pledged its shares of the capital stock of OcuSense, Inc., as collateral for the loan. Under the terms of the loan agreement, the company has two pre- payment options available to it, should it decide to not wait until the maturity date to repay the loan. Under the first pre-payment option, the company may repay the loan in full by paying the lenders, in cash, the amount of outstanding principal and accrued interest and issuing to the lenders five- year warrants in an aggregate amount equal to approximately 19.9% of the issued and outstanding shares of the company's common stock (but not to exceed 20% of the issued and outstanding shares of the company's common stock). The warrants would be exercisable into shares of the company's common stock at an exercise price of $0.10 per share and would not become exercisable until the 180th day following their issuance. Under the second pre-payment option, provided that the company has closed a private placement of shares of its common stock for aggregate gross proceeds of at least $4,000,000, the company may repay the loan in full by issuing to the lenders shares of its common stock, in an aggregate amount equal to the amount of outstanding principal and accrued interest, at a 15% discount to the price paid by the private placement investors. Any exercise by the company of the second pre-payment option would be subject to stockholder and regulatory approval. Non-Compliance with Nasdaq On Feb. 1, 2008, the company received a letter from The Nasdaq Stock Market indicating that, for the previous 30 consecutive trading days, the company's common stock did not maintain a minimum market value of publicly held shares of $5,000,000 as required for continued inclusion by Marketplace Rule 4450(a)(2). Therefore, in accordance with Marketplace Rule 4450(e)(1), the company was provided 90 calendar days, or until May 1, 2008, to regain compliance. The Nasdaq letter stated that, if at any time before May 1, 2008, the minimum market value of publicly held shares of the company's common stock is $5,000,000 or greater for a minimum of 10 consecutive trading days, Nasdaq staff will provide written notification that the company complies with the MVPHS Rule. The Nasdaq letter also stated that, if the company does not regain compliance with the MVPHS Rule by May 1, 2008, Nasdaq staff will provide written notification that the company's securities will be delisted, at which time it may appeal the Nasdaq staff's determination to delist its securities to a Nasdaq Listing Qualifications Panel. The company will not have become compliant with the Minimum Bid Price Rule by March 17, 2008. Although it intends to appeal any determination by Nasdaq staff to delist its common stock to a Nasdaq Listing Qualifications Panel, the company may not be successful in its appeal, in which case its common stock may be transferred to The Nasdaq Capital Market or be delisted altogether. Should either occur, existing stockholders will suffer decreased liquidity. The Nasdaq notice has no effect on the listing of the company's common stock on the Toronto Stock Exchange. A full-text copy of the company's 2007 annual report is available for free at http://ResearchArchives.com/t/s?2962 Headquartered in Mississauga, Ontario, Canada, OccuLogix Inc. (NasdaqGM: OCCX) (TSX: OC) -- http://www.occulogix.com/-- is a healthcare company focused on ophthalmic devices for the diagnosis and treatment of age-related eye diseases. ON SEMICONDUCTOR: Inks $32.8 Million Sale/Leaseback of Equipment ---------------------------------------------------------------- On Semiconductor Corp. said in a regulatory filing with the Securities and Exchange Commission that its wholly owned subsidiary, Semiconductor Components Industries LLC, consummated a sale and leaseback transaction with General Electric Capital Corporation with respect to certain manufacturing equipment located at SCILLC's semiconductor wafer fabrication facilities in Gresham, Oregon. As part of the Lease Financing, SCILLC sold the Equipment to GECC for approximately $32.8 million in cash on March 11, 2008, pursuant to two bills of sale and then leased the same Equipment back from GECC on the same day. The Lease Financing was effected pursuant to the terms of that certain Lease Agreement between SCILLC and GECC dated as of Nov. 7, 2006, as amended by Amendment No. 1 dated as of March 11, 2008. The parties also executed two new schedules to the Lease Agreement, each dated as of March 11, 2008, and several ancillary documents. Under the terms of the Lease Agreement, GECC's capitalized costs were approximately $32.8 million, SCILLC's interest rate is fixed at 7.6% per annum for a portion of the Equipment and 7.9% per annum for a portion of the Equipment, and lease payments are due monthly. The Lease Agreement provides SCILLC limited rights to relocate and substitute Equipment during its term. It further provides for: (1) a basic term of 48 months for a portion of the Equipment and 60 months for a portion of the Equipment with a cash purchase option at the end equal to the Equipment's then fair market value; (2) an early cash purchase option at 42 months for a portion of the Equipment and 30 months for a portion of the Equipment equal to approximately 54% of GECC's capitalized costs for a portion of the Equipment and approximately 48% of GECC's capitalized costs for a portion of the Equipment, respectively; and (3) an early termination provision in both schedules that provide for an additional early purchase option at 24 months at the fair market value at the time of such termination. In connection with the Lease Financing, ON entered into a Corporate Guaranty for GECC's benefit under which ON agreed to guaranty certain of SCILLC's obligations under the two new schedules to the Lease Agreement. Under the Lease Agreement, SCILLC indemnifies GECC for certain matters, including taxes. About ON Semiconductor Headquartered in Phoenix, Arizona, ON Semiconductor Corporation (NASDAQ: ONNN) -- http://www.onsemi.com/-- designs, manufactures, and markets power and data management semiconductors, and standard semiconductor components worldwide. It offers automotive and power regulation products. * * * As reported in the Troubled Company Reporter on Dec. 27, 2007, Moody's Investors Service has placed the ratings of ON Semiconductor (B1 CFR) on review for possible upgrade and affirmed the Ba3 corporate family and credit facility ratings for AMI Semiconductor, after the companies' Dec. 13, 2007, report that they have entered into a definitive agreement for ON Semi to acquire AMI Semi for approximately $915 million in an all-stock transaction. ON SEMICONDUCTOR: Completes Stock-for-Stock Merger with AMIS ------------------------------------------------------------ ON Semiconductor Corporation completed its acquisition of AMIS Holdings Inc., parent company of AMI Semiconductor, in a stock- for-stock merger. As reported in the Troubled Company Reporter on Dec. 14, 2007, ON Semiconductor and AMIS Holdings Inc. signed a definitive merger agreement providing for ON Semiconductor's acquisition of AMIS in an all-stock transaction with an equity value of approximately $915 million. Under the terms of the merger agreement, holders of AMIS will generally receive 1.15 shares of ON Semiconductor common stock for each share of AMIS common stock they own as of the close of business on March 17. ON Semiconductor will issue a total of approximately 103 million shares of common stock on a fully diluted basis to complete the transaction. Former AMIS stockholders now own approximately 26% of ON Semiconductor. At closing, ON Semiconductor repaid AMIS's senior bank facility with cash on hand from both companies. "The merger represents an important step in the transformation of ON Semiconductor," Keith Jackson, ON Semiconductor president and chief executive officer, said. "ON Semiconductor is now solidly positioned as a global leader of efficient power and analog solutions. The acquisition brings together ON Semiconductor's leading standard products, operational excellence and manufacturing infrastructure with AMIS's substantial custom product portfolio enabling us to more comprehensively address our customers' needs." "Furthermore, we expect to achieve significant operating and manufacturing cost savings," Mr. Jackson added. "Starting this week, the company will begin executing the planned operational integration of the two companies to ensure a smooth transition and create immediate value for our customers, partners and investors." "Our merger with ON Semiconductor is a great opportunity for our customers, employees, stockholders and their future," said Christine King, AMIS's former chief executive officer and president. "I am also looking forward to joining the ON Semiconductor board of directors effective March 17." Additional details regarding the acquisition will be made available during a conference call to discuss ON Semiconductor's first quarter 2008 results. The call is currently scheduled for May 7, 2008. During this call, the company also intends to discuss the gross margin and net income per share effects associated with the purchase accounting rules. Specifically, the company will outline the amortization of intangibles, in-process research and development charges, write-up of inventories and other non-cash transaction-related impacts to our financial statements. These purchase accounting rules should have no impact to the ongoing free cash flow of ON Semiconductor but will affect U.S. GAAP gross margins and net income per share for a period of time. About AMIS Holdings Inc. Headquartered in Pocatello, Idaho, AMIS Holdings Inc. (NASDAQ: AMIS) -- http://www.amis.com/-- is a holding company and conducts all its business operations through its wholly owned subsidiary, AMI Semiconductor Inc., and its subsidiaries. The company designs and manufactures customer-specific, mixed-signal semiconductor products. These products and services are focused on the automotive, medical, industrial, communications and military and aerospace markets. About ON Semiconductor Headquartered in Phoenix, Arizona, ON Semiconductor Corporation (NASDAQ: ONNN) -- http://www.onsemi.com/-- designs, manufactures, and markets power and data management semiconductors, and standard semiconductor components worldwide. It offers automotive and power regulation products. At Sept. 28, 2007, the company's balance sheet stockholders' deficit of $53.5 million, compared to last year's deficit of $225.4 million. * * * As reported in the Troubled Company Reporter on Dec. 27, 2007, Moody's Investors Service has placed the ratings of ON Semiconductor (B1 CFR) on review for possible upgrade and affirmed the Ba3 corporate family and credit facility ratings for AMI Semiconductor. ON THE GO: Posts $1,191,467 Net Loss in 2nd Quarter Ended Jan. 31 ----------------------------------------------------------------- On The Go Healthcare Inc. reported a net loss of $1,191,467 on sales of $6,083,734 for the second quarter ended Jan. 31, 2008, compared with a net loss of $814,800 on sales of $5,923,984 in the same period ended Jan. 31, 2007. Loss from operations increased to $691,258 during the three months ended Jan. 31, 2008, compared to loss from operations of $313,773 in the same period ended Jan. 31, 2007, mainly reflecting a decrease in gross margin to $20.9% (versus $24.3% in the prior year quarter) and an increase in selling, general and administrative expenses. Balance Sheet At Jan. 31, 2008, the company's consolidated balance sheet showed $10,007,123 in total assets, $7,832,121 in total liabilities, $1,000,000 in conditionally redeemable convertible preferred stock, and $1,175,002 in total stockholders' equity. The company's consolidated balance sheet at Jan.31, 2008, also showed strained liquidity with $7,139,210 in total current assets available to pay $7,832,121 in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?294f Going Concern Doubt At Jan. 31, 2008, the company had not yet achieved profitable operations, had accumulated losses of $20,061,713 since its inception, had a working capital deficiency of $692,911 and expects to incur further losses in the development of its business. The company believes these factors raise substantial doubt about the company's ability to continue as a going concern under generally accepted accounting principles. About On The Go Healthcare Headquartered in Ontario, Canada, On The Go Healthcare Inc. (OTC BB: OGOH) -- http://www.onthegohealthcare.com/-- doing business as On The Go Technologies Group, operates as a value added distributor of computer and computer related products. The company operates primarily in Canada. PEOPLES CHOICE: Judge Kwan Moots Exclusive Plan Filing Period ------------------------------------------------------------- The Hon. Robert N. Kwan of the United States Bankruptcy Court for the Central District of California mooted People's Choice Financial Corp. and its debtor-affiliates' request to further extend their exclusive period to file a bankruptcy plan, because of the filing of their Chapter 11 Joint Liquidating Plan of Reorganization on March 31, 2008. The Debtors' exclusive period to solicit acceptances of the Plan is further extended as to all parties, except the Official Committee of Unsecured Creditors to and including May 31, 2008. As reported in the Troubled Company Reporter on. Feb. 7, 2008, the Debtors asked the Court to extend their exclusive rights to file, and solicit acceptances of, a Chapter 11 plan.. The Debtors also sought to share their exclusive plan filing rights with the Official Committee of Unsecured Creditors. Except as to the Creditors Committee, the Debtors seek a two-month extension of their exclusive plan filing, through and including March 31, 2008; and their exclusive solicitation periods, through and including May 31, 2008. The Debtors reserve the right to seek further extensions. J. Rudy Freeman, Esq., at Pachulski Stang Ziehl & Jones LLP, in Los Angeles, California, related that the Debtors, with the Creditors Committee, have expeditiously marketed their assets for sale and sold those assets in a number of transactions. In April and May 2007, the Debtors sold their contractual loan servicing rights and residual interests. In July 2007, the Debtors sold their loan servicing and loan origination platforms. The Debtors have sold various loan portfolios owned by the Debtors as well as miscellaneous assets. Combined, the asset sales have yielded approximately $45,000,000 in gross proceeds to the Debtors' estates and resulted in the elimination of thousands of dollars in potential claims of employees and vendors. Mr. Freeman assured the Court that the Debtors are not seeking an extension of the Exclusivity Periods to extract any improper concessions from creditors. The Debtors and the Creditors Committee were in the process of negotiating key provisions of the plan and working in concert to prepare a joint plan of liquidation, Mr. Freeman tells Judge Kwan. The Debtors simply required additional time to finalize their asset liquidation strategy for the benefit of all stakeholders, and finalize key plan provisions, Mr. Freeman said. Given the progress the Debtors and the Creditors Committee have made in the orderly liquidation of the Debtors' Chapter 11 cases, any rogue plan would likely only waste valuable resources better spent bringing the bankruptcy cases to a conclusion, Mr. Freeman asserted. About People's Choice Headquartered in Irvine, California, People's Choice Financial Corp. -- http://www.pchl.com/-- is a residential mortgage banking company, through its subsidiaries, originates, sells, securitizes and services primarily single-family, non-prime, residential mortgage loans. The company and two of its affiliates, People's Choice Home Loan, Inc., and People's Choice Funding, Inc., filed for chapter 11 protection on March 20, 2007 (Bankr. C.D. Calif. Case No. 07-10772). J. Rudy Freeman, Esq., at Pachulski, Stang, Ziehl & Jones, L.L.P., represents the Debtors. Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. In its schedules filed with the Court, People's Choice disclosed total assets of $806,776,901 and total liabilities of $105,772,386. (People's Choice Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). PEOPLES CHOICE: Set Sale Procedures For 12 Properties ----------------------------------------------------- People's Choice Financial Corp. and its debtor-affiliates ask the United States Bankruptcy Court for the Central District of California to authorize and approve certain procedures for the sale or abandonment of 12 real property: (a) 41950W Colby Drive, Maricopa, Arizona; (b) 3211 Shore Side Drive, Crosby, Texas; (c) 479-481 Garden Street, Hartford, Connecticut; (d) 6121S Greenwood Ave Unit 3, Chicago, Illinois; (e) 1150 Rankin Street, Unit, Stone Mountain, Georgia; (f) 11909S Indiana Avenue, Chicago, Illinois; (g) 4339 Tracy, Kansas City, Missouri; (h) 153N Alabama Avenue, Jackson, Mississippi; (i) 11688 Rutherford Street, Detroit, Michigan; (j) 19N Shirley St., Pontiac, Michigan; (k) 5807 Holcomb, Detroit, Michigan; and (l) 549N Washington, Kankakee, Illinois In the ordinary course of their business, the Debtors were required to foreclose upon certain real properties where the Debtors held the underlying mortgage loan and had not yet sold or securitized the mortgage loan in the secondary market. According to Scotta E. McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, in Los Angeles, at this time, the Debtors' remaining material "hard" assets consist of 13 real properties, 12 of which is subject to this Motion. One real property is the subject of a separate motion. Sale Procedures With regard to sales of REO Property in any individual transaction or series of related transactions to a single buyer or a group of related buyers, the Debtors propose these procedures: (a) The Debtors will be authorized to consummate a Sale if (i) they determine that it is in the best interest of the estates, (ii) the Sale complies with the Sale Procedures, and (iii) they receive no opposition to the Sale within seven calendar day notice period. (b) All Sales will be free and clear of any liens, claims or encumbrances, with Liens attaching to the Sale proceeds in the same validity, extent and priority as immediately prior to the transaction. (c) A written Sale notice will be served to any known affected creditor asserting a Lien on the REO Property proposed to be disposed of by the Debtors, the Office of the United States Trustee, and counsel to the Official Committee of Unsecured Creditors seven calendar days before the closing of the Sale. (d) The Sale Notice will contain the address and general description of the REO Property to be sold; the proposed purchase price; the identity of the potential purchasers; the estimated net or book value of the property to be sold, if available; and the marketing efforts undertaken with respect to the Sale. (e) If a written objection by the Notice Parties is received within the seven-day period, the Debtors will be authorized to immediately consummate the Sale without further notice. If a written objection is timely received and cannot be resolved, the Debtors, if they elect to proceed with the Sale, will schedule the proposed Sale for hearing. The Sale will only then be implemented upon further Court order. Abandonment Procedures Costs associated with Sales of certain REO Property may exceed the proceeds of Sales. The inability to consummate a reasonably acceptable Sale of REO Property indicates that these assets have no meaningful monetary value to the estates. In those circumstances, the Debtors submit that abandonment of those REO Property is in their best interest, as well as their estates and creditors. The Debtors propose these Abandonment Procedures: (a) A written Abandonment notice will be served on the Notice Parties seven calendar days before abandonment. (b) The Abandonment Notice will contain the property address and a general description of the REO Property to be abandoned, and it will discuss the marketing efforts undertaken with respect to attempted sales of the REO Property, including any information on any offers received. (c) If no written objection is timely received from the Notice Parties, the REO Property will be deemed abandoned without further Court order. If a written objection is received and cannot be resolved, the Debtors, if they elect to proceed with the abandonment, will schedule a hearing. The relevant abandonment will only be implemented upon further Court order. Given the small monetary value of the REO Property in relation to the magnitude of the Debtors' overall estates, and considering the potentially high amount of carrying costs associated with much of the REO Property, as well as professional fees that may be incurred, it would not be an efficient use of resources to seek Court approval each and every time the Debtors have an opportunity to sell or need to abandon any REO Property, Ms. MacFarland tells the Court. In addition, without the proposed Procedures, the Debtors may be required to incur additional and unnecessary administrative charges for taxes, insurance, security or other expenses pending completion of proposed Sales or Abandonments, Ms. MacFarland states. About People's Choice Headquartered in Irvine, California, People's Choice Financial Corp. -- http://www.pchl.com/-- is a residential mortgage banking company, through its subsidiaries, originates, sells, securitizes and services primarily single-family, non-prime, residential mortgage loans. The company and two of its affiliates, People's Choice Home Loan, Inc., and People's Choice Funding, Inc., filed for chapter 11 protection on March 20, 2007 (Bankr. C.D. Calif. Case No. 07-10772). J. Rudy Freeman, Esq., at Pachulski, Stang, Ziehl & Jones, L.L.P., represents the Debtors. Winston & Strawn LLP represents the Official Committee of Unsecured Creditors. In its schedules filed with the Court, People's Choice disclosed total assets of $806,776,901 and total liabilities of $105,772,386. (People's Choice Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). PLASTECH ENGINEERED: Extends Supply Pact with Chrysler to April 2 ----------------------------------------------------------------- Plastech Engineered Products Inc. and its debtor-affiliates have reached a new interim supply agreement with Chrysler LLC. Pursuant to the deal, the Debtors will continue making parts for Chrysler at least through April 2, 2008, as their prior agreement ended March 17, according to The Associated Press and Erie Times. Pursuant to the initial interim agreement between the parties: -- Plastech will continue to deliver component parts to Chrysler; -- Chrysler is obligated to make certain payments to Plastech in conjunction with the continued production of component parts; and -- The Debtors are to allow BBK, as agents for Chrysler, to have supervised access to Plastech facilities for the purpose of inspecting and conducting an inventory of all tooling used for Chrysler production. Chrysler has appealed before the U.S. District Court for the Eastern District of Michigan, Southern Division a prior ruling by the Bankruptcy Court barring it from recovering certain equipment from Plastech's plants. Bankruptcy Court Judge Phillip Shefferly had held that while Chrysler held equity in the $180,400,000 worth of machinery that Plastech uses in its plants, the Debtor would need the machinery in order to continue its operations. The Plastech-Chrysler agreement comes as Plastech has sought another extension, to April 2, on the final hearing to consider approval of a final debtor-in-possession loan. Plastech has announced that it is negotiating the terms of a DIP loan from its major customers, under which the major customers will provide funding to Plastech until June 30 and assume Plastech's debts to Bank of America for the interim DIP financing and the prepetition loans it has provided to Plastech. About Chrysler LLC Based in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. About Plastech Engineered Based in Dearborn, Michigan, Plastech Engineered Products, Inc. -- http://www.plastecheng.com/-- is full-service automotive supplier of interior, exterior and underhood components. It designs and manufactures blow-molded and injection-molded plastic products primarily for the automotive industry. Plastech's products include automotive interior trim, underhood components, bumper and other exterior components, and cockpit modules. Plastech's major customers are General Motors, Ford Motor Company, and Toyota, as well as Johnson Controls, Inc. Plastech is a privately held company and is the largest family- owned company in the state of Michigan. The company is certified as a Minority Business Enterprise by the state of Michigan. Plastech maintains more than 35 manufacturing facilities in the midwestern and southern United States. The company's products are sold through an in-house sales force. The company and eight of its affiliates filed for Chapter 11 protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08- 42417). Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C., represent the Debtors in their restructuring efforts. The Debtors chose Jones Day as their special corporate and litigation counsel. Lazard Freres & Co. LLC serves as the Debtors' investment bankers, while Conway, MacKenzie & Dunleavy provide financial advisory services. The Debtors also employed Donlin, Recano & Company as their claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed in the Debtors' cases. As of Dec. 31, 2006, the company's books and records reflected assets totaling $729,000,000 and total liabilities of $695,000,000. (Plastech Bankruptcy News, Issue No. 13; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) POWERMATE HOLDING: Bankruptcy Causes LayOff of 100 Kearney Staff ---------------------------------------------------------------- Powermate Holding Corp.'s chapter 11 bankruptcy filing affected about 100 workers at its now-closed Kearney plant in Illinois, The Associated Press reports. Based on the report, the fate of rest of the Debtor's operations is unclear since the company has not released a statement. Powermate's customers who called Tuesday last week could not get their complaints and messages through with the absence of representatives, says AP. Kearney plant manager Ward Jorgenson informed workers about the closure Friday, AP reports. The report says that the Nebraska Workforce Development indicated to help the laid off workers to find new jobs. Sun Capital Partners, which acquired Powermate in 2004, failed to sell the company in 2006, AP notes. Aurora, Illinois-based Powermate Holding Corp., -- http://www.powermate.com/-- together with Powermate Corp. and Powermate International Inc., is a manufacturer of portable and home standby generators, air compressors, and pressure washers. In August 2004, Sun Capital Partners acquired Powermate, formerly Coleman Powermate from American Household. Powermate Holding and its two affiliates filed for chapter 11 protection on March 17, 2008 (Bank. D. Del. Case Nos. 08-10498 through 08-10500). The Hon. Kevin Gross presides the case. Kenneth J. Enos, Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor represent the Debtors in their restructuring efforts. Powermate Holding Corp. had $1 million to $10 million in assets and $50 million to $100 million in debts; Powermate Corp. had $50 million to $100 million in assets and debts; and Powermate International had $1 million to $10 million in assets and $50 million to $100 million in debts when they filed for bankruptcy. PRC LLC: Court Okays Evercore Group as Investment Bankers --------------------------------------------------------- PRC LLC and its debtor-affiliates obtained permission from the U.S. Bankruptcy Court for the Southern District of New York to employ Evercore Group LLC as their investment bankers and financial advisors. H. Philip Goodeve, PRC LLC's Chief Financial Officer, said that Evercore is familiar with the Debtors' businesses, financial affairs, and capital structure. Since the firm's initial retention in November 2007, Evercore has worked closely with the Debtors' management, creditors, other professionals and advisors in exploring various restructuring alternatives and otherwise assisting in preparing for the bankruptcy filing. The Debtors expects Evercore to, among others: -- review and analyze the Debtors' business, operations, and financial projections; -- evaluate the Debtors' potential debt capacity in light of its projected cash flows; -- assist in determining a capital structure for the Debtors, and a range of values for the Debtors on a going concern basis; -- advise the Debtors on tactics and strategies for negotiating with certain creditors; -- render financial advice to the Debtors and participate in meetings or negotiations with certain creditors or rating agencies or other appropriate parties in connection with any restructuring; -- advise the Debtors on the timing, nature, and terms of new securities, other consideration or other inducements to be offered pursuant to a restructuring; -- advise and assist the Debtors in evaluating potential financing transactions; and -- assist the Debtors in identifying and evaluating candidates for a potential sale transaction, advise the Debtors in connection with negotiations, and aid in the consummation of a sale transaction. The Debtors will pay Evercore a $125,000 monthly fee. Following the sixth month of the engagement, the monthly fee will be lowered to $100,000 for each successive month thereafter. Evercore will also receive a consummation fee, payable upon the consummation of any Restructuring -- but not both: (a) $1,800,000 if the Restructuring is confirmed within six months of the Debtors' filing for bankruptcy; or (b) $1,300,000 if any other Restructuring is confirmed later. The firm will be paid a Sale Transaction Fee if a Sale Transaction is consummated. The fee is equal to a portion of the Aggregate Consideration of a Sale Transaction: Aggregate Consideration Percentage Fee ----------------------- -------------- Less than $100 million 0.75% $100 to $140 million 1.00% Greater than $140 million 1.25% If the Aggregate Consideration is less than $100,000,000 then the Sale Transaction Fee should equal $1,000,000. Any Sale Transaction Fee paid will be credited against any Consummation Fee payable. The credit will only apply to the extent that the fees fees are approved in entirety by the Court. The firm will get a Financing Fee, payable upon consummation of any financing. The fee is equal to a portion of the total gross proceeds of a financing: Security Issued Percentage Fee --------------- -------------- Senior Secured Debt 1.00% Senior Debt 1.75% Subordinated Debt 2.25% Convertible Debt 2.50% Preferred Stock (convertible or otherwise) 3.75% Common Stock 4.25% Any Financing Fee paid will be credited against any Consummation Fee payable. The credit will only apply to the extent that the fees are approved in entirety by the Court. Stephen Sieh, a Managing Director at Evercore, assured the Court that neither Evercore nor any professional employee of Evercore has any connection with or any interest adverse to the Debtors, their creditors, or any other party-in-interest. Mr. Sieh said the firm is a "disinterested person," as that term is defined in Section 101(14) of the U.S. Bankruptcy Code. About PRC LLC Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC -- http://www.prcnet.com/-- is a leading provider of customer management solutions. PRC markets its services to brand-focused, Fortune 500 U.S. corporations and delivers these services through a global network of call centers in the U.S., Philippines, India, and the Dominican Republic. PRC is the sole member of each of PRC B2B, LLC, and Precision Response of Pennsylvania, LLC, and the sole shareholder of Access Direct Telemarketing, Inc., each of which is a debtor and debtor- in-possession in PRC's joint Chapter 11 cases. Panther/DCP Intermediate Holdings, LLC, is the sole member of PRC. PRC, together with its operating subsidiaries PRC B2B, Access Direct, and PRC PA, is a leading provider of complex, consultative, outsourced services in the Customer Care and Sales & Marketing segments of the business process outsourcing industry. Since 1982, the company has acquired and grown customer relationships for some of the world's largest and most brand-focused corporations in the financial services, media, telecommunications, transportation, and retail industries. The company and four of its affiliates filed for Chapter 11 protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08- 10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, represents the Debtors in their restructuring efforts. The Debtors chose Stephen Dube, at CXO LLC, as their restructuring and turnaround advisor. Additionally, Evercore Group LLC provides investment and financial counsel to the Debtors. The Debtors' consolidated financial condition as of Dec. 31, 2007 showed total assets of $354,000,000 and total debts of $261,000,000. The Debtors submitted to the Court a Chapter 11 Plan of Reorganization on Feb. 12, 2008. (PRC LLC Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) PRC LLC: Can Employ Philip Goodeve as Chief Financial Officer ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved PRC LLC and its debtor-affiliates' initial and supplemental application to employ H. Philip Goodeve as their chief financial officer. Prior to the Court's decision, the Debtors filed a supplemental application to amend and modify the terms of Mr. Goodeve's employment to reflect the terms of a Letter Agreement dated Feb. 21, 2008. The Letter Agreement provides, among other things, that: (i) Mr. Goodeve's services would end as of February 21, 2008; (ii) Mr. Goodeve will receive $75,000 every 30-day notice period, less any payroll deductions in lieu of any other payments or benefits to which Mr. Goodeve otherwise might be entitled, and an additional amount for reasonable accrued and unpaid expenses through February 18, 2008 upon submission of invoices or documentation; (iii) the contractual obligation of PRC, LLC, to indemnify and defend Mr. Goodeve will continue in force and effect after February 21, 2008; (iv) the Consulting Agreement between PRC and Mr. Goodeve is rescinded in its entirety and will be of no further force and effect. The Debtors selected Mr. Goodeve as their consultant because of his extensive experience in finance, strategy and management positions, according to PRC Chief Executive Officer Jerry McElhatton. He related that in August 2007, Mr. Goodeve was initially retained as a consultant by Diamond Castle Holdings, LLC, the Debtors' equity sponsor with respect to the purchase of the Debtors from its previous owner. From Sept. 1, 2007, to the date of bankruptcy, Mr. Goodeve's services have consisted of serving as PRC's chief financial officer, thus gaining invaluable and extensive knowledge of the Debtors' business, financial affairs, and capital structure. Under the consulting agreement, Mr. Goodeve will receive $75,000 in monthly fee, to be paid in bi-weekly installments. He is also entitled to a consummation fee for $550,000 if the reorganization is confirmed within five months after the bankruptcy filing, and an additional $300,000 if it is confirmed within one year. Subject to Court approval, PRC agrees to indemnify Mr. Goodeve under the terms of its operating agreement and other liability insurance, which PRC has purchased for its officers and consultants. About PRC LLC Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC -- http://www.prcnet.com/-- is a leading provider of customer management solutions. PRC markets its services to brand-focused, Fortune 500 U.S. corporations and delivers these services through a global network of call centers in the U.S., Philippines, India, and the Dominican Republic. PRC is the sole member of each of PRC B2B, LLC, and Precision Response of Pennsylvania, LLC, and the sole shareholder of Access Direct Telemarketing, Inc., each of which is a debtor and debtor- in-possession in PRC's joint Chapter 11 cases. Panther/DCP Intermediate Holdings, LLC, is the sole member of PRC. PRC, together with its operating subsidiaries PRC B2B, Access Direct, and PRC PA, is a leading provider of complex, consultative, outsourced services in the Customer Care and Sales & Marketing segments of the business process outsourcing industry. Since 1982, the company has acquired and grown customer relationships for some of the world's largest and most brand-focused corporations in the financial services, media, telecommunications, transportation, and retail industries. The company and four of its affiliates filed for Chapter 11 protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08- 10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, represents the Debtors in their restructuring efforts. The Debtors chose Stephen Dube, at CXO LLC, as their restructuring and turnaround advisor. Additionally, Evercore Group LLC provides investment and financial counsel to the Debtors. The Debtors' consolidated financial condition as of Dec. 31, 2007 showed total assets of $354,000,000 and total debts of $261,000,000. The Debtors submitted to the Court a Chapter 11 Plan of Reorganization on Feb. 12, 2008. (PRC LLC Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) QUAIL LAKE: Case Summary & 14 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Quail Lake Estates Associates, LP 1007 41st Street, Suite 442 Emeryville, CA 94608 Bankruptcy Case No.: 08-41296 Type of Business: The Debtor owns and manages real estate. Chapter 11 Petition Date: March 18, 2008 Court: Northern District of California (Oakland) Judge: Leslie J. Tchaikovsky Debtor's Counsel: James D. Wood, Esq. (jdw@jdwoodlaw.com) 3675 Mt. Diablo Boulevard, Suite 250 Lafayette, CA 94549-3775 Tel: (925) 284-9663 http://www.jdwoodlaw.com/ Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million Debtor's 14 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Claybar Engineering Engineering $180,920 Attn: Dennis Barksdale, Services President 9354 Elk Grove-Florin Road Elk Grove CA 95624 Tel: (916) 684 7301 Pacific Urban Properties Project $65,000 Attn: Alan Vail Management 10120 Fair Oaks Boulevard, Suite F Fair Oaks CA 95628 Civil Engineering Solutions, Engineering $28,377 Inc. Services 1325 Howe Avenue, Suite 302 Sacramento CA 95825 Tel: (916) 563-7300 Analytical Environmental Engineering $25,495 Services Services Pacific Environmental Engineering $15,000 Resources Services Holdrege & Kull Engineering $14,976 Services Hefner Stark and Marois Legal services $8,823 Eco: Logic Groundwater $7,972 Monitoring Wells Fargo Insurance Property $7,199 Insurance Engeo, Inc. Engineering $5,500 Services Gibson & Skordal, LLC Wetlands $2,029 Consulting Youngdahl Consulting Group, Engineering $840 Inc. Services Rancho Cortina Prop., Inc. Consulting $747 David Taussig & Associates Consulting $207 QUEBECOR WORLD: Wants to Assume BofA's Purchasing Card Pact ----------------------------------------------------------- Pursuant to Section 365 of the Bankruptcy Code and Rule 6006 of the Federal Rules of Bankruptcy Procedure, Quebecor World Inc. and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Southern District of New York to assume their Purchasing Card Agreement with Bank of America and cure an existing monetary default. In the alternative, the Debtors seek the Court's authority pursuant to Sections 105(a), 363(a) and 364(a) of the Bankruptcy Code to re-establish a purchasing card agreement with Bank of America. Michael Canning, Esq., at Arnold & Porter LLP, in New York, relates that prior to the Petition Date, the Debtors had a Purchasing Card Agreement with Bank of America in which Bank of America issued credit cards to certain of the Debtors' employees to be used in a manner similar to consumer credit cards and constitute unsecured debt obligations to the Debtors. The Debtors have historically used P-Cards for transactions with small vendors or ad hoc purchases in large part to minimize administrative costs for smaller purchasing transactions. The P- Cards serve as substitutes for petty cash, thus reducing the need for the Debtors to keep cash on hand at each of their facilities and permitting the Debtors to make certain payments more efficiently than would be possible using checks or wire transfers. Through 2007, the Debtors had approximately 400 individual card users and processed approximately $2,000,000 per month in purchases on the P-Cards. The provision of purchasing card services was withdrawn by Bank of America in mid-December 2007, in conjunction with actions taken by Bank of America to reduce credit exposure to the Debtors. As of the Petition Date, the Debtors had an outstanding balance of $460,000 owing to Bank of America for prepetition charges. Mr. Canning says that there is an urgent need to restore the P-Card program since its absence has resulted in (i) disruption of the Debtors' operations, (ii) increased administrative costs and (iii) more difficult relations with suppliers. Bank of America has consented to the assumption of the Purchase Card Agreement and has not requested any other assurance of future performance, conditioned upon the Debtors' payment of the cure amount required under Section 365(b) of the Bankruptcy Code. According to Mr. Canning, the Debtors have also satisfied the remaining requirements for assumption of the Purchasing Card Agreement since the term of the Purchasing Card Agreement has not expired, and the contact is executory. The Debtors have retained possession of the P-Cards. Similarly, although the Debtors' ability to utilize the P-Cards is currently frozen, Bank of America has maintained all of the information necessary to reactivate the program without delay. "Although the Debtors are not using the P-Cards presently, both parties stand ready to perform under the Purchasing Card Agreement upon assumption," Mr. Canning adds. Mr. Canning adds that to the extent that the Purchasing Card Agreement constitutes a financial accommodation not subject to assumption, the Debtors seek an alternative assumption by reinstating an arrangement with Bank of America to provide the Debtors with P-Cards as ordinary course, unsecured postpetiton credit under Section 364(a) of the Bankruptcy Code. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. In Canada it has 17 facilities in five provinces, through which it offers a mix of printed products and related value-added services to the Canadian market and internationally. The company is an independent commercial printer in Europe with 19 facilities, operating in Austria, Belgium, Finland, France, Spain, Sweden, Switzerland and the United Kingdom. In March 2007, it sold its facility in Lille, France. Quebecor World (USA) Inc. is its wholly owned subsidiary. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of $5,554,900,000, total liabilities of $3,964,800,000, preferred shares of $175,900,000, and total shareholders' equity of $1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. (Quebecor World Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating to the $400 million super priority senior secured revolving term loan facility of Quebecor World Inc. as a Debtor-in-Possession. The related $600 million super priority senior secured term loan was rated Ba3 (together, the DIP facilities). The RTL's better asset value coverage relative to the TL accounts for the ratings' differential. QUEBECOR WORLD: Wants to Pay DB Plans Funding Contributions ----------------------------------------------------------- Quebecor World Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to allow, but not direct, them to make all the minimum funding contributions to employee pension plans. The plans are defined benefit plans for which Debtors have statutory liability under the Employee Retirement Income Security Act of 1974, as amended, and that are intended to be qualified under the Internal Revenue Code of 1986, as amended. According Michael Canning, Esq. at Arnold & Porter LLP, in New York, ERISA and the I.R.C. require that the Debtors make minimum funding contributions due to six employee pension plans: (a) Quebecor World Pension Plan, (b) Quebecor World Baird-Ward Inc. Retirement Plan, (c) Quebecor World Mt. Morris II Inc. Employees' Pension Plan, (d) Quebecor World Buffalo Inc. Retirement Plan for Hourly Employees, (e) The Pension Plan for Hourly Employees of the Salem Gravure Division of Quebecor World (USA) Inc., and (f) Quebecor World Kingsport Inc. Pension Plan for Hourly Bargaining Unit Employees of Kingsport, Hawkins, Sherwood & Distribution. As Jan. 15, 2008, the Debtors owe $4,160,300 to the DB Plans' required quarterly minimum funding contributions for the fourth quarter of 2007. The Debtors have also calculated their future contributions to the DB Plans as they become due and owing during their reorganization. The Debtors have estimated $58,428,408 in future contributions to the DB Plans. Mr. Canning says that the Debtors seek the Court's authority to pay the past due contributions and future contributions under the "necessity of payment" doctrine as being necessary for the preservation of the estate. Mr. Canning relates that the failure to fund the DB Plans in accordance with statutory requirements would raise grave concerns among employees as to the security of their DB Plan benefits. "This would have a disruptive impact on the Debtors' workforce, and would jeopardize employee dedication and loyalty," he adds. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. In Canada it has 17 facilities in five provinces, through which it offers a mix of printed products and related value-added services to the Canadian market and internationally. The company is an independent commercial printer in Europe with 19 facilities, operating in Austria, Belgium, Finland, France, Spain, Sweden, Switzerland and the United Kingdom. In March 2007, it sold its facility in Lille, France. Quebecor World (USA) Inc. is its wholly owned subsidiary. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of $5,554,900,000, total liabilities of $3,964,800,000, preferred shares of $175,900,000, and total shareholders' equity of $1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. (Quebecor World Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating to the $400 million super priority senior secured revolving term loan facility of Quebecor World Inc. as a Debtor-in-Possession. The related $600 million super priority senior secured term loan was rated Ba3 (together, the DIP facilities). The RTL's better asset value coverage relative to the TL accounts for the ratings' differential. QUEBECOR WORLD: Seeks Nod to Pay Prepetition Wages to 376 Managers ------------------------------------------------------------------ Quebecor World Inc. and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to pay 376 managers prepetition payments due under certain incentive plans for the second half of 2007, which will become due and owing on March 31, 2008. According to Michael Canning, Esq. at Arnold & Porter LLP, in New York, the Debtors maintain two annual incentive plans for its management employees: the Management Incentive Compensation Plan and the Plant Based Incentive Plan. Mr. Canning notes that these Incentive Plans are integral components of how the Debtors reward and encourage their important managerial employees. Approximately 238 employees are participants in the MICP, and 348 employees are participants in the PBIP. Of these employees, approximately 376 are owed or will be owed prepetition incentive payments. Mr. Canning says that of the 376 employees, 135 are owed under MICP and 241 under PBIP. Mr. Canning adds that 80% of these employees have earned less than $150,000 in 2007. The total amount of incentive compensation due prepetition to the approximately 135 employees under the MICP is $2,627,776, which, on average, represents an average incentive bonus of approximately $20,000 per employee. Mr. Canning says that the amount of an employee's incentive bonus is based on the satisfaction of one or more performance criteria. In any given year, this criteria may include these targets: (1) Earnings Before Interests and Taxes (2) Return on Capital Employed (3) Return on Average Shareholder Equity (4) Cost of Capital (5) Earnings per Share The total amount of incentive compensation due prepetition to approximately 241 individuals under the PBIP is $1,949,760, which, on average, represents an average incentive bonus of approximately $8,000 per employee. According to Mr. Canning, the PBIP program is based on performance indicators that allow for the assessment of managers by using objectives set for the managers at the beginning of each year. These performance indicators address five main areas: (1) Capacity (2) Productivity (3) Quality (4) Health and Safety (5) Earnings Before Interests and Taxes (EBIT) The incentive bonus payable for each employee varies since it is expressed under the PBIP as a percentage of base salary earned by the employee and is determined based on performance measured against certain pre-established criteria. Mr. Canning believes that the failure to grant the Debtors' request with regard to these incentive payments, even for a brief period of time, could have a material adverse impact on the Debtors' businesses operations and their reorganization efforts, and would run afoul of the rehabilitative nature of the Bankruptcy Code. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. In Canada it has 17 facilities in five provinces, through which it offers a mix of printed products and related value-added services to the Canadian market and internationally. The company is an independent commercial printer in Europe with 19 facilities, operating in Austria, Belgium, Finland, France, Spain, Sweden, Switzerland and the United Kingdom. In March 2007, it sold its facility in Lille, France. Quebecor World (USA) Inc. is its wholly owned subsidiary. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of $5,554,900,000, total liabilities of $3,964,800,000, preferred shares of $175,900,000, and total shareholders' equity of $1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. (Quebecor World Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating to the $400 million super priority senior secured revolving term loan facility of Quebecor World Inc. as a Debtor-in-Possession. The related $600 million super priority senior secured term loan was rated Ba3 (together, the DIP facilities). The RTL's better asset value coverage relative to the TL accounts for the ratings' differential. QUICK SERVICE: Wants to Hire Fowler White as Bankruptcy Counsel --------------------------------------------------------------- Quick Service Foods Tampa Inc. seeks authority from the U.S. Bankruptcy Court for the Middle District of Florida to employ Fowler White Boggs Banker PA as counsel. Fowler White will: a) render legal advice with respect to the Debtor's duties and obligations and the continued operation of the Debtor's business; b) prepare, on the Debtor s behalf, the necessary motions, applications, orders, reports, pleadings, and other legal papers; c) appear before this Court, any state courts, any federal district courts, any appellate courts, and the United States Trustee to represent and protect the interests of the Debtor; d) take steps to confirm a plan of reorganization; e) represent the Debtor in all adversary proceedings , contested matters and matters involving administration of this case , both in federal and in state courts; f) perform all other legal services that may be necessary for the proper preservation and administration of the Chapter 11 case. Darren D. Farfante, a shareholder at Fowler White Boggs Baner P.A., tells the Court that the firm's professional hourly rates are: Professional Designation Rate ------------ ----------- ---- John D. Emmanuel, Esq. Shareholder $395 Donald R. Kirk, Esq. Shareholder $330 Darren D. Farfante, Esq. Shareholder $315 Keith T. Appleby, Esq. Associate $220 Darlene Raudabaugh Paralegal $130 Mr. Farfante relates that the firm received $28,208.50 from the Debtor as a retainer for post-petition services. The firm will also seek reimbursement for out-of-pocket expenses incurred in relation to this case. Mr. Farfante assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Farfante can be reached at: Fowler White Boggs Banker PA Suite 1700, 501 East Kennedy Boulevard Tampa, FL 33602 Tel (813) 222-2061 Fax (813) 229-8313 San Antonio, Texas-based Church's Chicken, founded in 1952, serves traditional southern and spicy fried chicken. As of January 2008, the company had 1,600 worldwide locations and sales of more than $1 billion. The parent company of Church's Chicken, Cajun Operating Co., is owned by private equity firm Arcapita, -- http://www.arcapita.com/-- is based in Atlanta. Quick Service Foods-Tampa Inc. filed for Chapter 11 bankruptcy on Feb. 29, 2008 (Bankr. M.D. Fla. Case No. 08-02797). When the Debtor filed for bankruptcy, it listed estimated assets of $10 million to $50 million and estimated debts of $1 million to $10 million. RH DONNELLEY: Earns $47 Million in Year Ended December 31 --------------------------------------------------------- R.H. Donnelley Corporation reported net income of $46.9 million for the year ended Dec. 31, 2007, compared with a net loss of $237.7 million for the year ended Dec. 31, 2006. R.H. Donnelley said 2007 net income includes approximately $29.0 million of one-time costs related to the refinancing completed in the fourth quarter and the write-down of an intangible asset due to the recent rebranding of the company's print products in the Embarq territory. Net revenue for 2007 was $2.68 billion, compared with $1.90 billion for 2006. EBITDA for the full year was $1.37 billion after $39.0 million of FAS 123 R expense and approximately $35.0 million of purchase accounting and related expenses. As of Dec. 31, 2007, RHD's net debt outstanding was $10.13 billion, including the purchase accounting fair value adjustment of $104.0 million. The company reported full year 2007 adjusted free cash flow of approximately $617.0 million based on cash flow from operations of $692.0 million, capital expenditures of $77.0 million and $2.0 million of adjustments related to Business.com. Full year advertising sales, pro forma for the impact of Business.com operations for the entire period, were $2.74 billion, up 0.4% from pro forma advertising sales for the same period in the prior year. "We made significant progress addressing our strategic priorities in 2007," said David C. Swanson, chairman and chief executive officer of R.H. Donnelley. "We aggressively invested in key areas to improve our value proposition both to consumers and advertisers. We extended the Dex market brand across our footprint and now present a single identity in the markets we serve. "In addition, we significantly advanced both our diversification in terms of online sales through our Triple Play solutions and the Business.com ad network, as well as our technology capabilities through the acquired Business.com team. These initiatives will help us to maintain our market leadership position in local search." Swanson continued, "Though we are pleased with our 2007 accomplishments, weaker economic conditions than originally anticipated have created a more difficult selling environment. As a result, we have lowered our outlook for 2008. Furthermore, given the recent decline in the share price and the near-term economic outlook, we have decided not to initiate a dividend in order to apply all cash flow towards debt repayment. I am confident that we remain well positioned for growth once we move past the current cyclical challenges." Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $16.09 billion in total assets, $14.27 billion in total liabilities, and $1.82 billion in total shareholders' equity. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $1.47 billion in total current assets available to pay $1.78 billion 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?2929 About R.H. Donnelley Headquartered in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun & Bradstreet Corp. -- http://www.rhdonnelley.com/ -- (NYSE: RHD) publishes and distributes print and online directories in the U.S. It offers print directory advertising products, such as yellow pages and white pages directories. R.H. Donnelley Inc., Dex Media, Inc. and Local Launch, Inc. are the company's only direct wholly owned subsidiaries. * * * As reported in the Troubled Company Reporter on Mar. 12, 2008, Moody's Investors Service affirmed all of R.H. Donnelley Corp.'s ratings, including its B1 corporate family rating while changing the rating outlook to negative. ROO GROUP: Appoints Gavin Campion as President ---------------------------------------------- ROO Group Inc. appointed Gavin Campion, managing director of Sputnik, as president of ROO, effective immediately. This effort was part of the company's move to streamline management structure. Mr. Campion, 35, has served as managing director of Sputnik since 2006. Under his leadership, Sputnik won B&T Interactive Agency of the Year in 2007. In 1999, he co-founded current ROO subsidiary Reality Group in Melbourne, Australia. Since that time, Reality Group has attracted blue-chip advertising clients such as Holden or General Motors, BP, TABCORP, Saab Australia, Tontine and Dennis Family Corp. Mr. Campion has also served as CEO of Shoppers Advantage, a leading Australian e-commerce company, and as a director of Presidential Card, Australia's largest discount loyalty program. Mr. Campion will have full responsibility for ROO Group's sales, operations and administration, reporting directly to Kaleil Isaza Tuzman, the chief executive officer of ROO Group and managing partner of KIT Capital. He will also take the lead role in fully integrating the operations of Sputnik into ROO Group. "The best thing about our current roster of moves is the appointment of [Mr. Campion] to the presidency role," Mr. Tuzman said. "His operational discipline and business development instincts are second-to-none and his interactive marketing experience will be of great value in differentiating ROO from our competitors - as we focus on an integrated video enablement and marketing approach for enterprise clients. [Mr. Campion] built a profitable business for us in the Asia-Pacific region, and we hope to see that quickly replicated across the global platform." "Sputnik has acquired its market leading position by consistently offering corporate clients the most innovative solutions for monetizing their online assets," Mr. Campion commented. "The key is to sell into our clients at the 'revenue line' with creative solutions for monetizing video, and not get stuck at the 'cost line' as strictly a software vendor. I believe that combining Sputnik's brand and creative services expertise with ROO's software and online video technology offers tremendous growth opportunities for the combined entity." About ROO Group Headquartered in New York, ROO Group Inc. (OTC BB: RGRP) -- http://www.roo.com/-- is a provider of digital media solutions and advercasting technology that enables the activation, marketing and distribution of digital media video content over the Internet and emerging broadcasting platforms such as set top boxes and mobile communication devices. ROO was founded in 2001 and went public in 2003. ROO has over 100 employees with worldwide operations in New York, Los Angeles, London and Australia. Going Concern Doubt Moore Stephens PC expressed substantial doubt about ROO Group Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the years ended Dec. 31, 2006, and 2005. The auditing firm pointed to the company's recurring losses and negative cash flows from operations. ROO GROUP: Unveils Plan to Streamline Structure; Moves HQ to Dubai ------------------------------------------------------------------ ROO Group Inc. intends to streamline its ownership and management structure through several initiatives: -- the appointment of Gavin Campion, the managing director of Sputnik Agency Pty. Ltd., as president of the overall company; -- the exercise of its right to complete the purchase of 51% of its Sputnik subsidiary; -- the execution of an agreement in principle to acquire the remaining 49% of Sputnik and the subsequent consolidation of Sputnik and subsidiary ROO Media Corporation; -- elimination of the 10 million preferred class of super- voting shares through a preferred-to-common conversion or other plan to be proposed and voted on by a majority of the common shareholders; -- the consolidation of all international subsidiaries into a Dubai subsidiary; and -- the relocation of its corporate headquarters and senior executive team from New York and Australia to Dubai, United Arab Emirates. The company relates that these initiatives are consistent with ROO's goals of simplifying the company's ownership structure and reducing management layers. The integration of Sputnik with ROO's online video player business will allow the company to better provide corporate customers with a suite of online video enablement and marketing solutions, and the consolidation of executive management in Dubai underscores ROO's international revenue mix -- with more than 85% of current revenues coming from outside North America. "From the first day that new management of ROO came on board two months ago, we have committed to shareholders that we would (a) control and reduce costs; (b) put the company on a near-term path to profitability; and (c) simplify the capital structure in a fair and transparent way," Kaleil Isaza Tuzman, chief executive officer of ROO Group and managing partner of KIT Capital, commented. "Given what appears to be some market misperception surrounding our current restructuring initiatives, we felt this would be a good time to re-iterate certain elements of our plan, and announce our intent to consolidate our profitable Sputnik subsidiary," added Mr. Tuzman. "Pursuant to the common shareholders approving a plan for elimination of the preferred class of shares, KIT Capital plans to execute on its investment of $5 million in primary common shares at $0.16-in accordance with its management contract with the company filed on Dec. 18, 2007," Mr. Tuzman continued. "With approximately $7.1 million of cash as of March 10, 2008-prior to the KIT Capital investment-and steadily reducing burn levels, we feel the company is in a strong financial position to execute its growth strategy." A conversion ratio of 3.2 common shares for each preferred share is presented to common shareholders, but the company remains open to other proposals that may be independently developed on a timely basis by the common shareholders. In accordance with its management contract with the company of Dec. 18, 2007, KIT Capital has the right to acquire 51% or 5.1 million of the preferred shares at $0.38/share, which would equal approximately 16.3 million of common shares at an average costs basis of $0.12/share, assuming the 1-to- 3.2 preferred-to- common conversion ratio is applied. The company has 38.9 million common shares outstanding, which would increase to approximately 70.9 million provided the 1-to-3.2 preferred- to-common conversion ratio is effected. The additional dilutive effect of the aforementioned KIT Capital investment of $5 million at $0.16/share would be 31.3 million shares, resulting in a pro forma, simplified capital structure of 102.2 million common shares. At that point, based on cash levels of March 10, 2008, the company would have approximately $12.1 million of pro forma cash on hand, and a pro forma market capitalization of $9.2 million, based on the closing price of the company's common shares as of March 14, 2008 of $0.09. To the extent the company were to engage in further equity financing, it is anticipated that such financing would be in the context of funding strategic acquisitions. About ROO Group Headquartered in New York, ROO Group Inc. (OTC BB: RGRP) -- http://www.roo.com/-- is a provider of digital media solutions and advercasting technology that enables the activation, marketing and distribution of digital media video content over the Internet and emerging broadcasting platforms such as set top boxes and mobile communication devices. ROO was founded in 2001 and went public in 2003. ROO has over 100 employees with worldwide operations in New York, Los Angeles, London and Australia. Going Concern Doubt Moore Stephens PC expressed substantial doubt about ROO Group Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the years ended Dec. 31, 2006, and 2005. The auditing firm pointed to the company's recurring losses and negative cash flows from operations. ROTECH HEALTHCARE: Receives Nasdaq's Equity Non-Compliance Notice ----------------------------------------------------------------- Rotech Healthcare Inc. received a Nasdaq Staff Deficiency letter indicating that the company has failed to comply with Marketplace Rule 4310(c)(3), which requires the company to have a minimum of $2.5 million in stockholders' equity or $35 million market value of listed securities or $500,000 of net income from continuing operations for the most recently completed fiscal year or two of the three most recently completed fiscal years for continued listing on the Nasdaq Capital Market. In its letter, the Nasdaq Staff states it is reviewing the company's eligibility for continued listing on the Nasdaq Capital Market. The company has until March 25, 2008, to provide the Nasdaq Staff with the company's specific plan to achieve and sustain compliance with all the Nasdaq Capital Market listing requirements, including the timeframe for completion of the plan. If, after conclusion of the review, the Nasdaq Staff determines that the company's plan does not adequately address the deficiencies noted, the Nasdaq Staff will provide written notification that the company's common stock will be delisted. At that time, the company may appeal the Nasdaq Staff's determination to a Nasdaq Listing Qualifications Panel. The company is in the process of responding to the Nasdaq Staff's letter. About Rotech Healthcare Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI) -- http://www.rotech.com/-- provides home medical equipment and related products and services in the United States, with a comprehensive offering of respiratory therapy and durable home medical equipment and related services. The company provides equipment and services in 48 states through approximately 500 operating centers located primarily in non-urban markets. As reported in the Troubled Company Reporter on March 11, 2008, Rotech Healthcare Inc.'s consolidated balance sheet at Dec. 31, 2007, showed $546.8 million in total assets, $551.9 million in total liabilities, and $5.3 million in Series A convertible redeemable preferred stock, resulting in a $10.5 million total stockholders' deficit. RURAL CELLULAR: Dec. 31 Balance Sheet Upside-Down by $791.2 Mil. ---------------------------------------------------------------- Rural Cellular Corp.'s consolidated balance sheet at Dec. 31, 2007, showed $1.35 billion in total assets, $1.94 billion in total liabilities, and $201.5 million in redeemable preferred stock, resulting in a $791.2 million total stockholders' deficit. The company reported a net loss of $14.8 million on revenue of $635.3 million for the year ended Dec. 31, 2007, compared with a net loss of $116.0 million on revenue of $564.5 million for the year ended Dec. 31, 2006. The increase in revenue mainly reflects a $39.9 million, or 10.4%, increase in service revenue and a $28.9 million, or 18.8% increase in roaming revenue. The increase in service revenue is attributable to an 11.2% increase in postpaid customers as compared to Dec. 31, 2006, together with an increase in local service revenue to $53 per month during the year ended Dec. 31, 2007, compared to $52 per month for the year ended Dec. 31, 2006. The 18.8% increase in roaming revenue reflects a 21.1% increase in outcollect minutes and a significant increase in data traffic, which together were partially offset by a decline in the company's voice and data roaming yields. Depreciation and amortization expense decreased 38.1% for the year ended Dec. 31, 2007 to $79.4 million as compared to $128.4 million for the year ended Dec. 31, 2006. This decrease reflects the fully depreciated status of the company's TDMA cell site assets at Dec. 31, 2006. Under SFAS No. 142, the company performed annual impairment tests in 2007 and 2006 for its indefinite lived assets. Based on these tests, the company recorded a noncash impairment charge included in operating expenses of $23.8 million in the fourth quarter of 2006, primarily resulting from a decline in license valuation in the company's South territory. There was no impairment charge in 2007 related to the company's annual assessment under SFAS No. 142. Junior Exchangeable Preferred Stock The company has failed to pay six quarterly dividends on the Junior Exchangeable Preferred Stock and, accordingly, a "Voting Rights Triggering Event," as defined in its Certificate of Designation has occurred. The accrued dividends in arrears for the junior exchangeable preferred securities, through Dec. 31, 2007, totaled approximately $70.7 million. Cash and Cash Equivalents and Short-Term Investments Primarily reflecting the cash payment of $41.7 million and $32.8 million in dividends on the company's senior exchangeable preferred stock and junior exchangeable preferred stock, respectively, the company's cash and cash equivalents and short- term investments decreased to $114.4 million as compared to $183.2 million at Dec. 31, 2006. Cash interest payments during the year ended Dec. 31, 2007, were $219.1 million as compared to $133.5 million during the year ended Dec. 31, 2006. 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?2935 About Rural Cellular Based in Alexandria, Minnesota, Rural Cellular Corporation (Nasdaq: RCCC) -- http://www.unicel.com/-- provides wireless communication services to Midwest, Northeast, South and Northwest markets located in 15 states. On Oct. 4, 2007, the company disclosed that its shareholders voted to approve the merger agreement providing for the acquisition of Rural Cellular Corporation by Verizon Wireless for approximately $2.67 billion in cash and assumed debt. The acquisition is subject to certain closing conditions, including governmental and regulatory approvals, and is expected to close during the second quarter of 2008. * * * Rural Cellular Corporation still carries Fitch Ratings' CCC Issuer default rating assigned on July 30, 2007. SCO GROUP: Posts $1.5 Million Net Loss in 1st Qtr. Ended Jan. 31 ---------------------------------------------------------------- The SCO Group Inc. reported a net loss of $1.5 million on total revenues of $4.9 million for the first quarter ended Jan. 31, 2008, compared with a net loss of $1.0 million on total revenues of $6.0 million in the same period ended Jan. 31, 2007. The company attributed the decrease in total revenues to a decrease in UNIX products and services revenues as a result of continued competition from other operating systems, primarily Linux and from continuing negative publicity from the company's filing of Chapter 11 bankruptcy and the litigation between the company and IBM, Novell and Red Hat. Reorganization expense totaled $844,000 during the first quarter ended Jan. 31, 2008. Reorganization expense consists of legal and professional fees associated with the Chapter 11 bankruptcy and development of a reorganization plan. Other income, net, increased $434,000 for the three months ended Jan. 31, 2008, as compared to the three months ended Jan. 31, 2007. This increase was primarily attributable to a realized gain as a result of a sale of intellectual property. Balance Sheet At Jan. 31, 2008, the company's consolidated balance sheet showed $12.9 million in total assets, $10.5 million in total liabilities, and $2.4 million in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?294e About SCO Group Headquartered in Lindon, Utah, The SCO Group Inc. (Nasdaq: SCOX) fka Caldera International Inc. -- http://www.sco.com/-- is a provider of UNIX software technology and a provider of mobility solutions. SCO offers UnixWare for enterprise applications and SCO OpenServer for small to medium businesses. SCO owns the core UNIX operating system, originally developed by AT&T/Bell Labs and is the exclusive licensor to UNIX-based system software providers. * * * The company and its affiliate, SCO Operations Inc., filed for Chapter 11 protection on Sept. 14, 2007, (Bankr. D. Del. Lead Case No. 07-11337). Epiq Bankruptcy Solutions LLC, acts as the Debtors' claims and noticing agent. The United States Trustee failed to form an Official Committee of Unsecured Creditors in these cases due to insufficient response from creditors. The Debtors' schedules of assets and liabilities showed total assets of $9,549,519 and total liabilities of $3,018,489. The Debtors' exclusive period to file a Chapter 11 plan expires on May 11, 2008. SEA CONTAINERS: Wants to Ink Two Charter Termination Agreements --------------------------------------------------------------- Sea Containers Ltd. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to allow Sea Containers Ltd. to enter into two Charter Termination Agreements in connection with the sale of SeaStreak America, Inc., and Highlands Landing Corporation by non-debtor affiliate Sea Containers America, Inc., to New England Fast Ferries for $3,000,000. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, relates that although SeaStreak conducts the operations of a fleet of vessels consisting of four high- speed passenger catamarans in New York Harbor, banks CitiCapital Commercial Leasing Corporation and Chase Equipment Leasing, Inc., own the Vessels. The Banks bareboat-chartered the Vessels to Circle Navigation, Inc., and its affiliates, pursuant to various bareboat charter agreements. Circle Navigation, in turn, time-chartered the Vessels to SeaStreak pursuant to various time charter agreements. As payment for SeaStreak's obligations under the Time Charters, SCL and SCA issued guarantees to CitiCapital and Chase Equipment. As of January 31, 2008, the outstanding obligation under the Time Charters is $17,600,000. Mr. Brady discloses that SeaStreak has been in default under the charters since May 2006 due to the financial condition of the Debtors. As part of the Debtors' restructuring efforts, and after negotiations with various interested entities, SCL decided to sell SeaStreak's equity to New England through a stock purchase agreement. As a condition to the sale's closing, SCL, SCA and Circle Navigation must execute separate Charter Termination Agreements with CitiCapital and Chase Equipment to facilitate the transaction for all the parties involved. Pursuant to the Agreements, all the Bareboat and Time Charters will be terminated, so the Banks can sell the Vessels to New England, free and clear of the Banks' liens and interests. In addition, SCL and SCA will be relieved of their obligations as guarantors. Under the Agreements, certain indemnification provisions contained in the Charters, and certain tax indemnification agreements between the Banks and SeaStreak will be ratified, and thus, survive the termination. The Debtors submit that the minimal obligations contemplated by the Agreements outweigh the benefits that they will obtain from the transaction. The Debtors assure the Court that SCL's participation in the sale through the Agreements provides significant benefit to the bankruptcy estates by eliminating substantial guaranty obligations, some of which are presently in default. In addition, the parties to the SPA and the Agreements have worked diligently to finalize the documents so that the transaction may be consummated by March 31, 2008. Accordingly, the Debtors also ask the Court to waive the 10-day stay period under Rule 6004(h) of the Federal Rules of Bankruptcy Procedure. About Sea Containers Based in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Court gave the Debtors until April 15, 2008 to file a plan of reorganization. SEALY CORP: David McIlquham Resigns as President and Chairman ------------------------------------------------------------- Sealy Corp. disclosed in a regulatory filing with the Securities and Exchange Commission that David J. McIlquham has resigned as president, chief executive officer and chairman of the board of directors of the company. The company also disclosed that Lawrence J. Rogers will become interim chief executive officer and Paul Norris will become non-executive chairman of the board of directors, effective immediately. Sealy Corp. said that Mr. Rogers joined the company in 1979. He has been president of Sealy North American since December 2006 and has also served as president of Sealy International as well as president of Sealy Canada. Mr. Norris is a current Sealy board member and former chairman and chief executive officer of W.R. Grace & Co. He is also a senior advisor at Kohlberg Kravis Roberts & Co., Sealy's largest shareholder. The Business Review reports that Sealy said that "Mr. McIlquham, along with the board of directors, has determined that it is in the best interest of the company to seek new leadership to achieve the company's long-term goals and initiatives." About Sealy Corporation Headquartered in Trinity, North Carolina, Sealy Corporation (NYSE: ZZ) -- http://www.sealy.com/-- manufactures and markets a broad range of mattresses and foundations under the Sealy(R), Sealy Posturepedic(R), Stearns & Foster(R), and Bassett(R) brands. Sealy operates 26 plants in North America. * * * At Dec. 2, 2007, the company's balance sheet showed $1.03 billion in total assets, $1.14 billion in total liabilities, and $16.2 million in common stock and options subject to redemption, resulting in a $129.4 million total stockholders' deficit. SEALY CORP: Unit's Weak Performance Prompts Moody's Neg. Outlook ---------------------------------------------------------------- Moody's Investors Service revised Sealy Mattress Company's rating outlook to negative following weaker than expected operating performance and concerns that the company may breach a financial covenant over the next year if its operating performance continues to moderate. "The recent earnings warning by Sealy accentuates the company's moderating operating performance over the last year" said Kevin Cassidy, Vice President and Senior Credit Officer at Moody's Investors Service. An example of Sealy's moderating performance is its operating margins, measured as EBITA revenue, decreasing to 10.5% on a reported basis in 2007 from 11.6% in 2006. While the company's performance may improve in the second half of 2008 with the re launch of its signature Posturpedic brand, Moody's is concerned that deteriorating discretionary consumer spending will further challenge the company. "The negative outlook reflects Moody's belief that the company will be tight in its leverage covenant in the second quarter when expenses are expected to increase because of the re launch of the Posturpedic brand and in the fourth quarter when there is a contractual step down" said Cassidy. The negative outlook also reflects Moody's belief that the company may seek a revision to its senior secured credit facility and amend its covenants. "Although we believe that the company would likely be able to amend its credit facility should the need arise, we think that there may be uncertainty about the banks willingness to do so and if they did at what cost" said Cassidy. Ratings affirmed and assessments revised: -- Corporate family rating at Ba3; -- Probability of default rating at Ba3; -- $440 million senior secured term loan at Ba1 (LGD 2, 23% from 27%); -- $125 million senior secured revolving credit at Ba1 (LGD 2, 23% from 27%); -- $390 million senior subordinated notes due 2014 at B2 (LGD-5 79% from 82%) Sealy Mattress Company, a wholly owned subsidiary of Sealy Corporation, is headquartered in Trinity, North Carolina. Net sales for the year ended November 2007 approximated $1.7 billion. SOLIDUS NETWORKS: Shuts Down Biometric Transactions for Clients --------------------------------------------------------------- Solidus Networks Inc. ceased biometric transactions on behalf of its merchant customers and consumer membership base, as of March 19, 2008. As part of the company's restructuring, it was determined that the enterprise could no longer support the biometric authentication and payment system as it currently exists, based on lack of funding and current market conditions. Other non-biometric Solidus Networks business units continue on their current business paths. Solidus Networks extends its gratitude to the shoppers, merchants, vendors, investors, partners, and employees who have been supporting the company's vision since its first biometric payment transaction in 2002. Headquartered in Culver City, California, Solidus Networks Inc., dba Pay By Touch, -- http://www.paybytouch.com/-- is a biometric authentication, personalized marketing and payment solutions. To date, patented Pay By Touch(TM) biometric services have enabled over 4 million shoppers in the U.S., Europe and Asia to quickly and securely use a finger scan to access personalized offers, make purchases, and cash checks at more than 2,600 locations nationwide. Founded in 2002, Pay By Touch holds more than 60 issued patents and 175+ pending patents worldwide on secure, convenient and cost-effective transaction solutions. Gregg Eyman, James C. Lee and Laura Schoep Lee filed an involuntary Chapter 11 petition against the company on Oct. 31, 2007, (Bankr. C.D. Calif. Case Number. 07-20027) Robert M. Yaspan, Esq. of the Law Offices of Yaspan & Thau, represents the petitioners. On Dec. 14, 2007, the Debtors gave their consent to the entry of an order for chapter 11 bankruptcy relief. That order was entered by the Hon. Thomas B. Donovan on Dec. 17, 2007. Bruce Bennett, Esq., James O. Johnston, Esq., and Lance Miller, Esq., at Hennigan, Bennett & Dorman LLP, represent the Debtor in its restructuring efforts. The Debtors' schedules show total assets of $75,698,454 and total liabilities of $330,618,305. The United States Trustee for Region 16 has established a four- member official committee of unsecured creditors in the Debtors' cases. Stutman Treister & Glatt PC represents the Official Committee of Creditors Holding Unsecured Claims. SPIRIT AEROSYSTEMS: S&P Alters Outlook to Stable; Holds BB Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on aerospace supplier Spirit AeroSystems Inc. to stable from negative. At the same time, S&P affirmed its ratings, including the 'BB' corporate credit rating, on the company. About $600 million of debt is outstanding. S&P also affirmed the 'BBB-' rating on Spirit AeroSystems' recently amended and increased $1.2 billion senior secured credit facility. This rating is two notches above the corporate credit rating, with a '1' recovery rating, indicating S&P's expectation of very high (90%-100%) recovery in the event of a payment default. The facility now consists of a $650 million ($400 million previously) revolver and a $584 million term loan B outstanding as of Dec. 31, 2007. "The outlook revision is based on improved liquidity, stemming from a material increase in the revolver," said Standard & Poor's credit analyst Roman Szuper. "This, combined with the company's other efforts to conserve cash, should provide sufficient liquidity cushion to mitigate adverse effects on Spirit's cash flow in 2008 from delays on Boeing's new 787 jetliner." Although the 787 should be a successful program later this decade and beyond, its first flight has been moved to the end of the second quarter of 2008, from the end of the first quarter, with initial deliveries to begin in early 2009, rather than late 2008. The delays are adversely affecting working capital and cash flow of most suppliers, including Spirit. Boeing Co. (A+/Stable/A-1) is in discussions with its suppliers regarding changes to the contracts, which in many cases specified that the vendors get paid for their shipments only when the 787 is certified and delivered to the first customer. The ratings on Spirit reflect participation in the cyclical and competitive commercial aerospace industry, reliance on one customer for about 90% of sales, significant near-term expenditures related to development of Boeing's 787 aircraft, and financial consequences from the delays on this program. Those factors are offset somewhat by the company's position as the largest independent supplier of structures for commercial aircraft, currently strong market conditions, substantial customer advances to fund most of the 787 development costs, improving profitability, and a moderately leveraged capital structure. Adequate near-term liquidity, good performance on existing programs, and a sizable backlog should help the company maintain current credit quality. Additional major delays or problems on the 787, failure to obtain satisfactory contract revisions with Boeing, or significant operational shortfalls could weaken the financial profile and warrant an outlook revision to negative. Successful ramp up of the 787, combined with a favorable environment in the commercial aircraft market and improvement in Spirit's financial performance, could lead to an outlook revision to positive or a rating upgrade. TABS 2006-5: Moody's Junks Rating on $950 Million Notes From 'C' ---------------------------------------------------------------- Moody's Investors Service downgraded ratings of eight classes of notes issued by TABS 2006-5, Ltd. The notes affected by this rating action are: Class Description: $950,000,000 Class A1S Variable Funding Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: B3, on review for possible action, direction uncertain -- Current Rating: C Class Description: $175,000,000 Class A1J Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $140,000,000 Class A2L Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $60,000,000 Class A3L Secured Deferrable Interest Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $30,000,000 Class B1L Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $40,000,000 Class B2L Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $22,500,000 Class B3L Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $22,500,000 Class CL Mezzanine Secured Deferrable Interest Floating Rate Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Since the closing date of this transaction there has been deterioration in the credit quality of the underlying portfolio, as well as the occurrence, as reported by the Trustee on Oct. 16, 2007, of an event of default caused by a failure of the Senior Credit Test to be satisfied, as described under Section 5.1(h) of the Indenture dated Oct. 5, 2006. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, certain participants to the transaction may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. In this regard, Moody's received notification from the Trustee that the holders of a majority of the Controlling Class directed the Trustee to proceed with the disposition of the Collateral in accordance with the Indenture. Furthermore, Moody's was notified that the Trustee has sold all of the Collateral and has made a final distribution in application of the proceeds of such liquidation. The Trustee informed Moody's that the proceeds of the sale of the Collateral and other available funds were not sufficient to pay the Class A1S Notes in full. Moody's was informed that consequently there were no liquidation proceeds or other available funds to make payments on any of the other Classes of Notes. The rating downgrades taken reflect the increased expected loss and severity of loss associated with each tranche as a result of the outcome of the liquidation. TABS 2006-5, Ltd is a collateralized debt obligation backed primarily by a portfolio of RMBS and CDO securities. TECUMSEH PRODUCTS: Shareholder Asks Board to Evaluate Sale of Biz ----------------------------------------------------------------- Tecumseh Products Company's board of directors received a letter, from the Herrick Foundation, a shareholder of Tecumseh, in which the foundation requested, among other things, that the board form a committee to explore a possible sale of the company. In addition, the Herrick Foundation suggested that the company take various actions to change the company's corporate governance posture, including seeking shareholder approval at Tecumseh's 2008 annual shareholders meeting to eliminate provisions contained in the company's amended certificate of incorporation that protect Class A shareholders. On March 11, 2008, Edwin L. Buker, chairman of the board, chief executive officer and president of Tecumseh, sent a letter to The Herrick Foundation stating that the requests contained in the foundation's March 10 letter will be appropriately considered by the board in due course, consistent with its fiduciary duties. Mr. Buker further advised The Herrick Foundation that neither the foundation nor any of its representatives or affiliates has been authorized by Tecumseh to pursue a sale of, or any other transaction involving, Tecumseh. About Tecumseh Products Company Headquartered in Tecumseh, Michigan, Tecumseh Products Company (Nasdaq: TECUA, TECUB) -- http://www.tecumseh.com/-- manufactures hermetic compressors for air conditioning and refrigeration products, gasoline engines and power train components for lawn and garden applications, submersible pumps, and small electric motors. The company has offices in Italy, United Kingdom, Brazil, France, and India. In March of 2007, the company's Brazilian engine subsidiary, TMT Motoco, was granted permission by the Brazilian courts to pursue a judicial restructuring, similar to a U.S. filing for Chapter 11 bankruptcy protection. The TMT Motoco filing in Brazil constituted an event of default with our domestic lenders. On April 9, 2007, the company obtained amendments to its First and Second Lien Credit Agreements that cured the cross-default provisions triggered by the filing in Brazil. TEMPUR-PEDIC INT'L: S&P Changes Outlook to Stable; Holds BB Rating ------------------------------------------------------------------ Standard & Poor's Rating Services revised its long-term rating outlook on Lexington, Kentucky-based Tempur-Pedic International Inc. to stable from positive. At the same time, Standard & Poor's affirmed its 'BB' corporate credit rating on the company. "The outlook revision follows the company's recent announcement that results for the first quarter of 2008 will be below previous expectations due to the impact on the company's bedding business of a difficult consumer spending environment," said Standard & Poor's credit analyst Rick Joy. "We expect that this will hurt operating margins and credit protection measures in the near term, and that the company will need to reduce operating expenses to restore profitability to prior levels." Standard & Poor's ratings on Tempur-Pedic reflect the company's narrowly focused position within the competitive mattress industry, and its exposure to raw material cost volatility. Somewhat offsetting these factors is the company's position as a premium alternative to traditional bedding products, its geographic and channel diversification, and the mattress industry's history of relatively stable demand. TRICOM SA: Bancredit Balks at Schedules Filing Extension -------------------------------------------------------- Bancredit Cayman Limited objects to the extension of Tricom S.A. and its affiliates' deadline for filing their schedules of assets and liabilities, and statements of financial affairs. Bancredit asserts that the filing of the Schedules and Statements are necessary for transparency and for the creditors to ascertain what the Debtors' assets are. As reported in the Troubled Company Reporter on March 12, 2008, the U.S. Bankruptcy Court for the Southern District of New York extended the Debtors' Schedules filing deadline until April 14, 2008. The Debtors have asserted that they are not in a position to complete the Schedules and Statements within the time specified in Rule 1007(c) of the Federal Rules of Bankruptcy Procedure given the numerous critical operational matters that their staff of accounting and legal personnel must address in the early days of their Chapter 11 cases. Bankruptcy Rule 1007(c) requires the filing of schedules and statement within 15 days after the bankruptcy filing. On behalf of Bancredit, Timothy T. Brock, Esq., at Satterlee Stephens & Burke LLP, in New York, tells the Court that the absence of transparency has been an ongoing and critical problem for the Debtors. The requirement of filing Schedules and Statements is an opportunity for the Court to ensure transparency during the Debtors' reorganization. Mr. Brock asserts that the Court should not permit a foreign entity in a United States bankruptcy proceeding to reorganize under a continuing cloud of opacity and obfuscation. In light of the Debtors' background and Bancredit's $120,000,000 claim, there is an obvious necessity for transparency that sworn Schedules and Statements will only begin to provide, he asserts. Bancredit asserts a $120,000,000 claim against the Debtors for alleged fraudulent transfers made by the Debtors' majority controlling owner, Manuel Arturo Pellerano. About Tricom Tricom, S.A., was incorporated in the Dominican Republic on January 25, 1988, as a Sociedad Anonima. Tricom is one of the pre-eminent full service communications services providers in the Dominican Republic. Headquartered in Santo Domingo, Tricom offers local, long distance, and mobile telephone services, cable television and broadband data transmission and Internet services, which are provided to more than 729,000 customers. Tricom's wireless network covers about 90% of the Dominican Republic's population. Tricom's local service network is 100% digital. The Company also owns interests in undersea fiber-optic cable networks that connect and transmit telecommunications signals between Central America, the Caribbean, the United States and Europe. Tricom USA, Inc., a wholly owned subsidiary of Tricom, was incorporated in Delaware in 1992, and at that time was known as Domtel Communications. A name change was effected in 1997 and Domtel Communications formally became Tricom USA, Inc. Tricom USA originates, transports and terminates international long-distance traffic using switching stations and other telecommunications equipment located in New York and Florida. Tricom S.A. and its U.S. affiliates filed for Chapter 11 protection on Feb. 29, 2008 (Bankr. S.D. N.Y. Case No. 08-10720). Larren M. Nashelsky, Esq., at Morrison & Foerster LLP, in New York City, represent the Debtors. When the Debtors' filed for protection from their creditors, they listed total assets of $327,600,000 and total debts of $764,600,000. (Tricom Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Services Inc.; http://bankrupt.com/newsstand/or 215/945-7000). TRICOM SA: Wants to Hire FTI as Restructuring Consultant -------------------------------------------------------- Pursuant to Section 363(b) of the Bankruptcy Code, Tricom S.A. and its affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to employ FTI Consulting, Inc., as their restructuring consultant, nunc pro tunc to their bankruptcy filing date. The Debtors selected FTI because of its extensive experience in providing restructuring consulting services in reorganization proceedings and its excellent reputation for the services it has rendered in Chapter 11 cases. The firm is also familiar with the Debtors' business operations since it has assisted the Debtors in their restructuring efforts before the Petition Date. Pursuant to the engagement letter dated January 23, 2008, Kevin Lavin will serve as chief restructuring officer of Tricom, S.A., with the assistance of other FTI personnel including Gabriel Bresler who will serve as restructuring officer. As consultants, they are expected to: (1) perform a financial review of the Debtors; (2) assist in identifying and implementing short-term cash management procedures; (3) assist in identifying and implementing cost reduction and operations improvement opportunities; (4) monitor the Debtors' performance with their business plan; (5) respond to inquiries from the Ad Hoc Committee, any official committee of unsecured creditors appointed in the case, and other creditors and key constituent groups regarding the Debtors' financial status and other operational issues, as appropriate; (6) assist the Debtors' management team and counsel focused on the coordination of resources related to the ongoing reorganization effort; (7) serve as the principal contact with the Debtors' creditors with respect to financial, operational and Chapter 11 administrative matters; (8) assist in the implementation of the Chapter 11 cases and the confirmation of the plan; and (9) provide other services, consistent with the role of FTI as requested or directed by the Debtors. In exchange for the services, Messrs. Lavin and Bresler will be paid at a rate of $715 and $665 per hour. Meanwhile, the other FTI personnel who may render services will be compensated at these hourly rates: Senior Managing Directors $650 - $715 Director & Managing Directors $475 - $620 Consultants & Sr. Consultants $235 - $440 Paraprofessionals $100 - $190 The Debtors also agreed to reimburse FTI for out-of-pocket expenses it may incur in connection with its retention, and to indemnify Messrs. Lavin and Bresler. Prior to the Petition Date, FTI received $200,000 retainer from the Debtors. FTI will continue to hold the retainer and will apply it against the final fees and expenses specific to the engagement. About Tricom Tricom, S.A., was incorporated in the Dominican Republic on January 25, 1988, as a Sociedad Anonima. Tricom is one of the pre-eminent full service communications services providers in the Dominican Republic. Headquartered in Santo Domingo, Tricom offers local, long distance, and mobile telephone services, cable television and broadband data transmission and Internet services, which are provided to more than 729,000 customers. Tricom's wireless network covers about 90% of the Dominican Republic's population. Tricom's local service network is 100% digital. The Company also owns interests in undersea fiber-optic cable networks that connect and transmit telecommunications signals between Central America, the Caribbean, the United States and Europe. Tricom USA, Inc., a wholly owned subsidiary of Tricom, was incorporated in Delaware in 1992, and at that time was known as Domtel Communications. A name change was effected in 1997 and Domtel Communications formally became Tricom USA, Inc. Tricom USA originates, transports and terminates international long-distance traffic using switching stations and other telecommunications equipment located in New York and Florida. Tricom S.A. and its U.S. affiliates filed for Chapter 11 protection on Feb. 29, 2008 (Bankr. S.D. N.Y. Case No. 08-10720). Larren M. Nashelsky, Esq., at Morrison & Foerster LLP, in New York City, represent the Debtors. When the Debtors' filed for protection from their creditors, they listed total assets of $327,600,000 and total debts of $764,600,000. (Tricom Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Services Inc.; http://bankrupt.com/newsstand/or 215/945-7000). TRICOM SA: Wants to Hire Kurtzman as Notice & Claims Agent ---------------------------------------------------------- Pursuant to Section 363(b) of the Bankruptcy Code, Tricom S.A. and its affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to employ Kurtzman Carson Consultants, LLC, as their notice, claims and balloting agent. The Debtors relate they have hundreds of creditors, equity security holders and other parties-in-interest involved in their Chapter 11 cases that must be served with notices for various purposes. The Debtors believe that Kurtzman is fully equipped to handle the volume of mailing involved in properly sending the required notices and processing the claims of creditors and other interested parties. Kurtzman is expected to perform the necessary administrative tasks to effectively operate the Debtors' Chapter 11 cases. For noticing and claims processing tasks, Kurtzman will: (a) prepare and serve required notices on behalf of the Debtors, including notices of the commencement of the Debtors' Chapter 11 cases, the initial meeting of creditors, objections to claims, hearings on a disclosure statement and confirmation of the Debtors' Chapter 11 plan, among others. (b) prepare for filing with the Clerk of the Court's Office a certificate or affidavit of service that includes an alphabetical list of persons on whom the notice was served along with their addresses and the date and manner of service; (c) maintain copies of all proofs of claim and proofs of interest filed in the Debtors' Chapter 11 cases; (d) maintain official claims registers by docketing all proofs of claim and interest in a claims database; (e) implement necessary security measures to ensure the completeness and integrity of the claims registers; (f) transmit to the Clerk's Office a copy of the claims registers on a weekly basis unless the Clerk's Office requests a more or less frequent basis; (g) maintain an up-to-date mailing list for all entities that have filed proofs of claim or proofs of interest and make that list available upon request to the Clerk's Office or any party-in-interest; (h) provide access to the public for examination of copies of the proofs of claim or interest without charge during regular business hours; (i) record all transfers of claims pursuant to Rule 3001(e) of the Federal Bankruptcy Rules of Bankruptcy Procedure, and provide notice of those transfers as required by Rule 3001(e) of the Federal Rules of Bankruptcy Procedure; (j) comply with applicable federal, state, municipal, and local statutes, ordinances, rules, regulations, orders and other requirements; (k) provide temporary employees to process claims as necessary; (l) comply with other conditions and requirements as the Clerk's Office or the Court may at any time prescribe; and (m) provide other claims processing, noticing, and related administrative services as may be requested from time to time by the Debtors. Meanwhile, for balloting functions, Kurtzman will: (i) print ballots; (ii) prepare voting reports by plan class, creditor, or shareholder and amount for review and approval by the Debtors and their counsel; (iii) coordinate the mailing of ballots, disclosure statement, and plan of reorganization to all voting and non-voting parties and provide affidavit of service; (iv) establish a toll-free "800" number to receive and address questions regarding voting on the plan; and (v) receive ballots at Kurtzman's headquarters, inspect ballots for conformity to voting procedures, date stamping and numbering ballots consecutively, and tabulate and certify the results. For the contemplated services, Kurtzman will be paid based on its hourly rates, and will also be reimbursed for necessary out-of- pocket expenses it incurs. Prior to the Petition Date, the Debtors paid Kurtzman a retainer of $75,000. Moreover, as part of the overall compensation payable to Kurtzman, the Debtors agreed to indemnify and hold Kurtzman harmless under certain situations, except in circumstances of gross negligence or willful misconduct. Sheryl R. Betance, Director of Restructuring Services of Kurtzman, assures the Court that the firm does not hold or represent any interest adverse to the Debtors, their estates, their creditors and any parties-in-interest. About Tricom Tricom, S.A., was incorporated in the Dominican Republic on January 25, 1988, as a Sociedad Anonima. Tricom is one of the pre-eminent full service communications services providers in the Dominican Republic. Headquartered in Santo Domingo, Tricom offers local, long distance, and mobile telephone services, cable television and broadband data transmission and Internet services, which are provided to more than 729,000 customers. Tricom's wireless network covers about 90% of the Dominican Republic's population. Tricom's local service network is 100% digital. The Company also owns interests in undersea fiber-optic cable networks that connect and transmit telecommunications signals between Central America, the Caribbean, the United States and Europe. Tricom USA, Inc., a wholly owned subsidiary of Tricom, was incorporated in Delaware in 1992, and at that time was known as Domtel Communications. A name change was effected in 1997 and Domtel Communications formally became Tricom USA, Inc. Tricom USA originates, transports and terminates international long-distance traffic using switching stations and other telecommunications equipment located in New York and Florida. Tricom S.A. and its U.S. affiliates filed for Chapter 11 protection on Feb. 29, 2008 (Bankr. S.D. N.Y. Case No. 08-10720). Larren M. Nashelsky, Esq., at Morrison & Foerster LLP, in New York City, represent the Debtors. When the Debtors' filed for protection from their creditors, they listed total assets of $327,600,000 and total debts of $764,600,000. (Tricom Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Services Inc.; http://bankrupt.com/newsstand/or 215/945-7000). TRIGEM COMPUTER: Seeks Court Approval of Toshiba Settlement ----------------------------------------------------------- Il-Hwan Park, foreign representative for TriGem Computer, Inc., asks the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, to approve a settlement agreement TriGem entered with Toshiba Corporation. TriGem commenced an adversary proceeding to permanently enjoin the continuation of a prepetition lawsuit initiated by Toshiba, David Packard and John E. Hock against TriGem in the U.S. District Court for the Central District of California; or in the alternative, allow the TriGem case under Chapter 15 of the Bankruptcy Code to remain open in perpetuity so the automatic stay will continue and obviate the need to enjoin the continuation of the Toshiba Lawsuit. Toshiba and Messrs. Packard and Hock sued TriGem in the California District Court for alleged infringement of several Toshiba Patents. The salient terms of the Settlement are: (a) The Adversary Proceeding will be dismissed with prejudice solely against Toshiba, with each party bearing its own costs. (b) Toshiba will forever refrain from initiating, filing, instituting, maintaining or continuing any claim against TriGem arising from or relating to the infringement of the five Toshiba U.S. Patents related to sales of desktop computers by TriGem prior to June 16, 2005. The five Toshiba U.S. Patents are: * Patent No. 6,230,209; * Patent No. 6,128,015; * Patent No. 5,475,762; * Patent No. 5,430,867; and * Patent No. 6,463,396. (c) TriGem and Toshiba will stipulate to dismiss without prejudice the prepetition plenary lawsuit filed by Toshiba in the U.S. District Court for the Central District of California, with each party bearing its own costs. The Settlement does not affect the Adversary Proceeding as against David Packard and John E. Hock. Charles D. Axelrod, Esq., at Stutman Treister & Glatt PC, in Los Angeles, California, asserts that the Settlement is fair and reasonable and achieves the goal of the Adversary Proceeding in all material respects. The Settlement, he adds, is the product of good faith and arm's-length negotiations between TriGem and Toshiba. It takes into account the potential concerns raised by Toshiba, with respect to potentially unfair, unintended, and unnecessary consequences it might experience if the permanent injunction, rather than the "covenant not to sue" procedure, was followed. Mr. Axelrod avers that additional litigation fees and costs that could be relatively significant are avoided by the Settlement. If the Bankruptcy Court does not approve the Toshiba Settlement, TriGem said it intends to pursue its summary judgment request against Toshiba. TriGem informs the Bankruptcy Court that it is ready for trial in relation to the Adversary Proceeding, and that no discovery is needed to prepare for that trial. TriGem, however, said that it has not engaged in formal mediation with Toshiba because of the Settlement. TriGem noted that it would take it more than half a day to present its case. TriGem intends to call on at least five witnesses and present 10 exhibits during the trial. TriGem Agrees to Extend Response Deadline In separate Bankruptcy Court-approved stipulations, TriGem agreed to extend the deadline for Toshiba, if the Settlement is not approved, and Messrs. Packard and Hock to respond to the Complaint until April 4, 2008. To note, TriGem previously asked the Bankruptcy Court in February 2008 to enforce a default judgment on Messrs. Packard and Hock because they have not filed any response to the Adversary Proceeding. In response, Messrs. Packard and Hock told the Bankruptcy Court that TriGem improperly served the Complaint and summonses, which resulted to them not receiving the documents on time. Toshiba is represented by Evan Finkel, Esq., at Pillsbury Winthrop Shaw Pittman LLP, in Los Angeles, California. Messrs. Packard and Hock are represented by Thomas H. Prouty, Esq., at Ross, Dixon & Bell, LLP, in Irvine, California. About TriGem Computer Headquartered in Ansan City, Kyunggi-Do, Korea, TriGem Computer Inc. -- http://www.trigem.com/-- manufactures desktop PCs, notebook PCs, LCD monitors, printers, scanners, other computer peripherals, and PIDs and supplies over four million PCs a year to clients all over the world. Il-Hwan Park, the Foreign Representative, filed a chapter 15 petition on Nov. 3, 2005 (Bankr. C.D. Calif. Case No. 05-50052). Charles D. Axelrod, Esq., at Stutman Treister & Glatt, P.C., represents the Foreign Representative in the United States. TriGem America Corporation, an affiliate of the Debtor, filed for chapter 11 protection on June 3, 2005 (Bankr. C.D. Calif. Case No. 05-13972). TriGem Texas, Inc., another affiliate of the Debtor, also filed for chapter 11 protection on June 8, 2005 (Bankr. C.D. Calif. Case No. 05-14047). On Sept. 13, 2007, TriGem filed Draft Plan Amendments in Korea and on September 20 filed a Final Plan Amendment. The Korean Court confirmed Trigem's Amended Plan on Oct. 4, 2007. (TriGem Bankruptcy News, Issue No. 14 Bankruptcy Creditors' Service, Inc., 215/945-7000). UAL CORPORATION: Drops Plea to Hold American Moulding in Contempt ----------------------------------------------------------------- UAL Corporation and its debtor-affiliates withdrew their request to hold American Moulding -- and any counsel who assisted it -- in contempt of a California Bankruptcy. The Debtors did not disclose the reason for their withdrawal. As reported in the Troubled Company Reporter on Feb. 6, 2008, American Moulding, by and through Development Specialist Inc., has decided to proceed in a Court with discharged litigation against the Debtors, in violation of the Bankruptcy Code, the Debtors' Plan of Reorganization and the Court's order confirming the Debtors' Plan, Micah E. Marcus, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, related. American Moulding and its counsel's open disavowal of the Bankruptcy Code, the Plan and the Confirmation Order has caused the Debtors substantial damages which accrue on a daily basis as the Debtors expend legal fees preparing for the defense of the barred claims, Mr. Marcus told the Court. Despite actual service of all of the relevant notices by the Debtors, American Moulding failed to file administrative claims with respect to any alleged preference liability of the Debtors, or any claim for that matter, prior to the Plan's administrative bar date, Mr. Marcus stated. Nevertheless, Mr. Marcus said, American Moulding filed an adversary case against the Debtors on Oct. 12, 2007, alleging a right to recover certain payments it made to the Debtors during the course of the Debtors' bankruptcy. All of the events on which American Moulding based its Complaint occurred prior to the Confirmation date. Accordingly, the Debtors ask the Hon. Eugene R. Wedoff of the U.S. Bankruptcy Court for the Northern District of Illinois, overseeing the Debtors' chapter 11 case filed in 2002, to: -- hold in contempt of Court, American Moulding and any counsel who assisted it in proceeding with the discharged litigation against the Debtors; and -- require American Moulding and its counsel to reimburse the Debtors for all costs and expenses associated with defending against American Moulding's case. About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * Fitch Ratings, on May 2007, affirmed the Issuer Default Ratings of UAL Corp. and its principal operating subsidiary United Airlines Inc. at B-. UAL CORPORATION: Staff Not Protected by AMFA, Teamsters Says ------------------------------------------------------------ The Teamsters Union said that the Aircraft Mechanics Fraternal Association failed to protect mechanics' jobs at United Airlines Inc., Northwest Airlines Corp. and Alaska Airlines Inc. AMFA also misrepresented conditions at Teamster airlines. Continental Airlines Inc. outsourced jobs before the Teamsters were elected to represent mechanics at that airline. The number of mechanics and related at Continental increased to 3,605 last year from 3,050 in 1998, when the Teamsters became the mechanics' representative. Continental's furlough list has been exhausted and new mechanics have been hired. In contrast, 3,289 mechanics and related lost their jobs at United between 2003 and 2006 while they were represented by AMFA. United has cut more maintenance workers than any other U.S. airline. Additionally, thousands of mechanics lost their jobs at other AMFA-represented carriers, including Alaska and Northwest airlines. "Anyone who's seen what happened at United, or watched mechanics marched off the cliff at Northwest Airlines, understands that AMFA has to resort to lies to hang on to the members it has left," said Teamsters General President Jim Hoffa. Despite AMFA claims, there has been no job loss at Teamster- represented carriers. United Airline mechanics are in the midst of voting to switch representation to the Teamsters from AMFA. The voting period ends March 31. Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico. There are 40,000 Teamsters airline employees, including more than 9,000 mechanics and related at 11 airlines. About Alaska Airlines Headquartered in Seattle, Washington, Alaska Airlines Inc. -- http://alaskaair.com/-- is a wholly owned subsidiary of Alaska Air Group Inc. (NYSE: ALK). Air Group is also the parent company of Horizon Air Industries Inc. and Alaska Air Group Leasing. Alaska Airlines and Horizon Air together serve 92 cities through an expansive network in Alaska, the Lower 48, Hawaii, Canada and Mexico. 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. About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents, including Italy, Spain, Japan, China, Venezuela and Argentina. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed $14.4 billion in total assets and $17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. (Northwest Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * Fitch Ratings, on May 2007, affirmed the Issuer Default Ratings of UAL Corp. and its principal operating subsidiary United Airlines Inc. at B-. UAL CORPORATION: De-registers Unsold 4.5% Convertible Notes ----------------------------------------------------------- On April 23, 2006, UAL Corporation and United Air Lines, Inc., filed with the United States Securities and Exchange Commission, a registration statement pursuant to the terms of a Registration Rights Agreement, dated July 25, among UAL, United and Goldman, Sachs & Co. The Registration Statement and accompanying prospectus registered the resale of up to $726,000,000 principal amount of UAL's 4.50% Senior Limited-Subordination Convertible Notes due 2021, and the shares of common stock issuable upon conversion of the Securities. In a regulatory filing with the SEC dated February 19, 2008, and in accordance with the undertaking contained in the Registration Statement, UAL amended the Registration Statement to remove from registration, all of the aggregate principal amount of the Securities and related common stock previously registered that remain unsold under the Registration Statement. UAL de-registered the Securities and the related common stock because it is no longer required under the Registration Rights Agreement to keep the Registration Statement effective, Frederic F. Brace, executive vice president and chief financial officer of UAL, reported. About UAL Corp. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The company filed for chapter 11 protection on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. The Court confirmed the Debtors' Second Amended Plan on Jan. 20, 2006. The company emerged from bankruptcy protection on Feb. 1, 2006. (United Airlines Bankruptcy News, Issue No. 154; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * Fitch Ratings, on May 2007, affirmed the Issuer Default Ratings of UAL Corp. and its principal operating subsidiary United Airlines Inc. at B-. UNITED RENTALS: Pays $27 Mil. Settlement for Class Action Lawsuits ------------------------------------------------------------------ United Rentals Inc. entered into a memorandum of understanding with lead plaintiff's counsel to settle three purported class action lawsuits that were filed after the August 2004 statement of an SEC inquiry concerning the company's historical accounting practices. The memorandum of understanding provides that the claims of the plaintiff class will be settled for a cash payment of $27.5 million. The contemplated settlement is subject to the prior satisfaction of a number of conditions, including definitive settlement documentation and court approval. In addition, the settlement is contingent upon United Rentals and its insurance carriers finalizing agreements on the portion of the settlement to be funded by the carriers, well as the amounts that the carriers will reimburse United Rentals for defense costs concerning the shareholder actions and related inquiries and matters that have previously been expensed by the company. The company expects, taking into account anticipated settlement funding and defense cost reimbursements from its insurance carriers, that the contemplated settlement will not have a material effect on its results of operations or cash flows for any period. The memorandum of understanding provides that United Rentals and the individual defendants will each receive a release from the members of the purported plaintiff class, which consists of persons who purchased United Rentals securities from Feb. 28, 2001, to Aug. 30, 2004. The contemplated settlement is without any admission of liability or fault by the company or any of the other defendants. United Rentals noted that the contemplated settlement does not affect the SEC inquiry of the company, which is still ongoing. The company is continuing to cooperate fully with the SEC. About United Rentals Headquartered in Greenwich, Conn., United Rentals Inc. (NYSE: URI) -- http://www.unitedrentals.com/ -- is an equipment rental company with an integrated network of over 690 rental locations in 48 states, 10 Canadian provinces and Mexico. The company's approximately 10,900 employees serve construction and industrial customers, utilities, municipalities, homeowners and others. The company offers for rent over 20,000 classes of rental equipment with a total original cost of $4.2 billion. * * * As reported in the Troubled Company Reporter on Jan. 2, 2008, Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating on United Rentals Inc. and its major operating subsidiary United Rentals (North America) Inc. and removed all ratings from CreditWatch with negative implications. The outlook is stable. USEC INC: Earns $25 Million in Fourth Quarter ended December 31 --------------------------------------------------------------- USEC Inc. reported net income of $25.1 million for its fourth quarter ended Dec. 31, 2007, compared to net income of $40.1 million in the same quarter of 2006. Pro forma net income before American Centrifuge expenses was $42.5 million in the fourth quarter of 2007 compared to $61.9 million in the same quarter last year. USEC reported net income of $96.6 million for full-year 2007 ended Dec. 31, 2007, compared to $106.2 million in the same period of 2006. Pro forma net income before American Centrifuge expenses was $178.5 million in 2007, compared to $173.3 million in 2006. Both net income and cash flow from operations exceeded previous guidance provided with the company's third quarter 2007 results. The financial results in 2007 reflect higher revenue on increased SWU volume and higher average prices billed to customers, offset by higher electric power costs, and to a lesser extent, higher purchase costs from Russia. These results also reflect the impact of $22.1 million of non-cash reversals of prior income tax-related accruals. The gross profit margin for 2007 was 14.9% compared to 18.2% in the same period of 2006. "2007 was a year of accomplishments for USEC on several fronts," John K. Welch, USEC president and chief executive officer, said. "Our financial results for the year were substantially better than our initial outlook. Eighteen months ago we said the gross profit margin for 2007 was likely to be around 5 percent, which would have resulted in a substantial loss." "We worked hard to change that future and delivered a positive financial result," Mr. Welch added. "We negotiated a five-year power supply agreement with fairly predictable rates that provided us with additional electricity and allowed us to increase production at our Paducah plant. Our team at Paducah responded by producing a record amount of low enriched uranium for a month in December." "We also began construction of the American Centrifuge Plant in May and began operations in our Lead Cascade integrated testing program in Piketon, Ohio in August," Mr. Welch said. "All of these actions are part of our plan to deliver long-term shareholder value by positioning USEC to take advantage of the growing global demand for nuclear power, a clean and cost- effective source of electricity." Update on American Centrifuge Project To date much of the spending on the American Centrifuge project has been expensed, which reduces net income. In the third quarter, USEC moved from a demonstration phase to a commercial plant phase where increasing amounts of costs were capitalized as part of building the American Centrifuge Plant. Nonetheless, ACP expenses for 2007 totaled $126 million, which represents a 22% increase over 2006. Liquidity and Capital Resources At Dec. 31, 2007, USEC had a cash balance of $886.1 million reflecting the $775 million net proceeds we raised in September 2007, compared to $171.4 million at Dec. 31, 2006. Cash flow from operations in 2007 was $109.2 million, compared to cash flow from operations of $278.1 million in 2006. The $168.9 million difference was due to a smaller reduction in inventory year over year reflecting a reduction in SWU and uranium sales quantities, offset by increases in average costs. Capital expenditures totaled $137.2 million in 2007, compared to $44.8 million for 2006. The majority of capital expenditures were related to the American Centrifuge project. Cash flow from financing activities reflects the $775 million net proceeds raised in September 2007 through the concurrent issuance of 23 million shares of common stock and $575 million in convertible notes. At Dec. 31, 2007, the company's balance sheet showed total assets of $3.087 billion, total laibilities of $1.778 billion and total stockholders' equity of $1.309 billion About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- a global energy company, is a supplier of enriched uranium fuel for commercial nuclear power plants. * * * As reported in the Troubled Company Reporter on Sep. 28, 2007, Standard & Poor's Ratings Services assigned its 'CCC' senior unsecured rating to USEC Inc.'s $500 million 3% convertible senior unsecured notes due Oct. 1, 2014. At the same time, S&P affirmed its 'B-' corporate credit rating on the company. The outlook is negative. USPROTECT CORP: Judge Catliota Appoints Chapter 7 Trustee --------------------------------------------------------- The Hon. Thomas J. Catliota of the U.S. Bankruptcy Court for the District of Maryland appointed a case trustee to oversee the business of USProtect Corp. while under involuntary chapter 7 bankruptcy, The Associated Press reports. The case trustee appointment was requested by Wachovia Bank, NA, unit of Wachovia Corp., which claimed that the management of the Debtor was "nonexistent" following the layoff and resignation of key officers, AP relates. According to AP's report, Wachovia told the Court that Lisa D. Hudec's cash out of about $5 million salary as chairman for the three quarters of 2007 was a misappropriation of funds. Union Tribune in San Diego and The Washington Post reveal that Ms. Hudec was paid $384,615 in the comparable period in 2006. Wachovia recounted that Ms. Hudec move to cancel deals involving several government offices like the Social Security Administration, the U.S. Marshals Service and the Walter Read Army Research Institute, says AP. AP reveals that despite the normal 20 days appropriated by the law for the Debtor to respond to the involuntary petition, Wachovia contested that a case trustee is "crucial" in the Debtor's case saying USProtect's remaining deals are in danger of being canceled. Tribune and Post say that Wachovia refused to honor checks used for payroll and demanded repayment of loans before it filed for an involuntary petition against USProtect. USProtect, which halted its business last week, owes $15 million to Wachovia, AP reports. Ms. Hudec, according to AP, is presently in her Florida home and under a doctor's care. USProtect's Other Troubles Tribune and Post report that Ms. Hudec's husband and USProtect's former chief operating officer, Richard Hudec, is scheduled for sentencing on March 31, 2008. Mr. Hudec is facing five years imprisonment after pleading guilty to tax evasion in November 2007, based on the reports. The reports relate that USProtect founder Michael Holiday is also facing 20 years imprisonment after bribing a federal officer in exchange for a contract of providing security guards to a federal establishment. He was also caught committing child pornography, based on the reports. Mr. Holiday sold USProtect to Ms. Hudec in 2003. USProtect gained at least $180 million in contracts since 2000, Tribune recounts. According to the report, the Debtor shouldn't have gotten San Diego contract because it lost to another bidder by $10 million. Tribune reveals that General Services Administration officer, Dessie Nelson, is also facing sentencing of up to 20 year imprisonment after consenting to USProtect's fraudulent contract- winning schemes. Federal prosecutors are mulling to seize the Debtor's $7 million in cash and two of Ms. Hudec's houses, reports relate. About USProtect Silver Spring, Maryland-based USProtect Corp. -- http://www.usprotect.com/-- provides physical security, guard force protection, risk and vulnerability assessment, and emergency preparedness services to the U.S. Federal Government and its contractors, and to commercial entities in the nation's critical infrastructure. It provides consulting services in facility design, program implementation, and testing, and armed or unarmed guard force protection at hundreds of facilities throughout the United States, ensuring personnel and property safety and security while preserving the health and safety of the public. Wachovia Bank, NA and two other creditors filed involuntary chapter 7 petition against USProtect with the U.S. Bankruptcy Court for the District of Maryland. VALEANT PHARMA: Posts $6.2 Million Net Loss in Year Ended Dec. 31 ----------------------------------------------------------------- Valeant Pharmaceuticals International reported a net loss of $6.2 million on total revenues of $872.2 million for the year ended Dec. 31, 2007, compared with a net loss of $57.6 million on total revenues of $862.8 million for the year ended Dec. 31, 2006. In 2007, the company recorded a restructuring charge of $23.2 million which consisted of $13.6 million for the 2006 Restructuring and $9.6 million related to the 2008 Strategic Review. This compared with a restructuring charge of $138.2 million for 2006. The 2006 Restructuring was primarily focused on the company's research and development and manufacturing operations. The charges in the 2006 Restructuring included impairment charges of $97.3 million resulting from the sale of the company's former headquarters facility, discovery and pre-clinical operations equipment, and its former manufacturing facilities in Puerto Rico and Basel, Switzerland. 2008 Strategic Review and Restructuring In October 2007, the company's board of directors initiated a strategic review of its business direction, geographic operations, product portfolio, growth opportunities, and acquisition strategy. The company expects to make an announcement pertaining to its 2008 Strategic Review in late March 2008. The company said that this review will lead to significant changes in its business. Income from Operations Income from operations increased to $75.3 million for the year ended Dec. 31, 2007, compared to income of $8.0 million during the year ended Dec. 31, 2006. Income from Continuing Operations Income from continuing operations was $26.1 million in 2007, compared with a loss from continuing operations of $56.8 million in 2006. Loss from Discontinued Operations The loss from discontinued operations was $32.2 million in 2007 compared to a loss of $751,000 for 2006. The losses in 2007 and 2006 related to the company's Infergen business. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $1.49 billion in total assets, $1.08 billion in total liabilities, and $414.1 million in total shareholders' equity. 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?295d About Valeant Pharmaceuticals Headquartered in Costa Mesa, California, Valeant Pharmaceuticals International (NYSE: VRX) -- http://www.valeant.com/-- is a global specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of neurology, infectious disease and dermatology. * * * In January 2007, Moody's Investors Service confirmed the ratings of Valeant, including the B2 Corporate Family Rating, and concluded the rating review for possible downgrade, which was first initiated on Oct. 23, 2006. Ratings hold to date. VICORP RESTAURANTS: S&P Gives Negative Outlook; Holds Junk Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its ratings outlook on Denver-based VICORP Restaurants Inc. to negative from developing. S&P has also affirmed the 'CCC' corporate credit rating on the company. "The outlook revision reflects the increased near-term default risk as a result of the company not filing its 10-K within 30 days of its extended due date," explained Standard & Poor's credit analyst Charles Pinson-Rose. Consequently, VICORP is in technical default as stipulated by the indenture of is 10.5% senior notes dues in 2011, meaning that noteholders can now accelerate redemption of accrued interest and principal. However, the noteholders would have to have previously notified the company through the note's trustee of the event of default. "We have not been able to determine if the company has been notified of the event of default," added Mr. Pinson-Rose. VICTOR PLASTICS: $17.4MM Sale to River Bend to Close on April 21 ---------------------------------------------------------------- Victor Plastics Inc. disclosed that River Bend Industries of Fort Smith, Arkansas will buy the company for $17.4 million, The Associated Press reports. The sale, expected to close by April 21, 2008, is subject to the approval by the U.S. Bankruptcy Court for the District of Minnesota. According to AP, if the deal is approved by the Court, about 400 workers at Victor Plastics will keep their jobs. Morris Anderson & Associates managing director David Mack was appointed to administer in the sale of the assets and will assist in the restructuring of the Debtor, says AP. Mr. Mack told AP that he is impressed by River Bend's "management and their financial backing." As reported in the Troubled Company Reporter on Feb. 18, 2008, Victor Plastics signed a Letter of Intent to sell the company to River Bend Industries, according to Tim Czmiel, Victor Plastics' chief executive officer. Mr. Czmiel said that River Bend is a highly successful and respected company in the plastic injection industry and he expects to sign a purchase agreement within the next 14 days. Following the execution of the purchase agreement with River Bend, a motion will be filed with the Bankruptcy Court for authority to hold an auction which will be open to all interested and qualified parties. The winning bidder will need to be approved by the Bankruptcy Court at a hearing to follow the auction. About River Bend Industries Fort Smith, Arkansas-based River Bend Industries -- http://www.riverbendind.com/-- has a complete liquid handling center and offers farm spray equipment, professional lawncare equipment, fiberglass and poly tanks, fire truck tanks, pumps, hose and fittings, spray accessories, portable outdoor toilets, and deicing spray equipment. River Bend Industries and its predecessor companies have been in the plastic injection molding for more than 40 years. It is a supplier to Whirlpool, Exide Industries and the Husqvarna Group of Sweden. About Victor Plastics Based in North Liberty, Iowa, Victor Plastics Inc. -- http://www.victorplastics.com/-- is a custom molder of thermoplastics and engineering resins. The Debtor and its affiliate, VPI Acquisition Company, filed for Chapter 11 protection on Jan. 15, 2008 (Bankr. D. Minn. Case Nos. 08-40171 and 08-40167). Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman P.A., represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Kalina, Wills, Gisvold & Clark PLLP. When the Debtors filed for protection from their creditors, Victor Plastics listed total assets of $44,658,000, and total liabilities of $41,366,000, while VPI Acquisition listed estimated assets of less than $50,000 and estimated debts of $10 million to $100 million. WELLMAN INC: Wants to Sell Former Bottle Yard for $400,000 ---------------------------------------------------------- Wellman, Inc., and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Southern District of New York to sell, pursuant to Section 363 of the Bankruptcy Code, a 53-acre lot located at its Johnsonville, South Carolina, facility to South Carolina Public Service Authority (Santee Cooper) for $400,000. Wellman formerly used the property to store plastic bottles awaiting recycling in connection with its Material Recycling Division. Prior to the disposition of the Material Recycling Division in 2006, it was the largest recycling center of plastic bottles in the United States. Since the sale of the division in 2006, the Bottle Yard has stood vacant. Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York, relates that given the location of the property and its particular characteristics, the Bottle Yard is generally unmarketable, except to a discrete number of entities. In the fall of 2007, Santee Cooper announced that it was building a coal-fired electric plant located near the Johnsonville Facility. Santee Cooper has supplied Wellman's electricity at the Johnsonville Facility since operations began in 1954. Given this longstanding relationship, Wellman informally told Santee Cooper that, should the need arise, Wellman had a number of vacant warehouses and lots onsite that likely could be made available for storage in connection with Santee Cooper's construction project. In November 2007, Santee Cooper inquired as to whether Wellman owned any property that could be used for storage and as a staging ground for the steel needed in Santee Cooper's construction of its nearby facility. After discussions with Wellman, Santee Cooper offered to pay Wellman the appraised value of the property. The Appraisal Group, Inc., appraised the Bottle Yard to be worth $400,000, as of Nov. 20, 2007. As part of that process and in recognition of the time-sensitive interests of Santee Cooper, on Feb. 21, 2008, Wellman and Santee Cooper executed a site access agreement under which Santee Cooper was granted access to the Bottle Yard in advance of closing the sale so it could begin preparing the site for its use. On March 12, 2008, the good-faith, arm's-length negotiations between Wellman and Santee Cooper resulted in an agreement between the parties regarding Santee Cooper's purchase of the Bottle Yard. Pursuant to the Sale Agreement, Santee Cooper will purchase the property on an "as is, "where is" condition and free and clear of claims and encumbrances. Headquartered in Fort Mill, South Carolina, Wellman Inc. -- http://www.wellmaninc.com/-- manufactures and markets packaging and engineering resins used in food and beverage packaging, apparel, home furnishings and automobiles. They manufacture resins and polyester staple fiber a three major production facilities. The company and its debtor-affiliates filed for Chapter 11 protection on Feb. 22, 2008 (Bankr. S.D. N.Y. Case No. 08-10595). Jonathan S. Henes, Esq., at Kirkland & Ellis, LLP, in New York City, represents the Debtors. Wellman Inc., in its bankruptcy petition, listed total assets of $124,277,177 and total liabilities of $600,084,885, as of Dec. 31, 2007, on a stand-alone basis. Debtor-affiliate ALG, Inc., listed assets between $500 million and $1 billion on a stand-alone basis at the time of the bankruptcy filing. Debtor-affiliates Fiber Industries Inc., Prince Inc., and Wellman of Mississippi Inc., listed assets between $100 million and $500 million at the time of their bankruptcy filings. On a consolidated basis, Wellman Inc., and its debtor-affiliates listed $498,867,323 in assets and $684,221,655 in liabilities as of Jan. 31, 2008. (Wellman Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) WESTWAYS FUNDING: Poor Asset Market Value Cues Moody's Rating Cuts ------------------------------------------------------------------ Moody's Investors Service downgraded the ratings on nine classes of notes issued by Westways Funding XI, Ltd., a market value CDO issuer. This rating action is: (1) $202,000,000 Class A-PT Floating Rate Senior Notes Due 2013 -- Current Rating: B2, on review for downgrade -- Prior Rating: Baa2, on review for downgrade (2) $30,000,000 Class LA Senior Loan Interests Due 2013 -- Current Rating: B2, on review for downgrade -- Prior Rating: Baa2, on review for downgrade (3) $191,750,000 Class A-1 Floating Rate Senior Notes Due 2013 -- Current Rating: Ba2, on review for downgrade -- Prior Rating: Baa2, on review for downgrade (4) $63,000,000 Class A-2 Floating Rate Senior Notes Due 2013 -- Current Rating: Caa2, on review for downgrade -- Prior Rating: Baa2, on review for downgrade (5) $31,500,000 Class B Floating Rate Senior Subordinate Notes Due 2013 -- Current Rating: Ca -- Prior Rating: B2, on review for downgrade (6) $21,500,000 Class LB Subordinate Loan Interests Due 2013 -- Current Rating: Ca -- Prior Rating: B2, on review for downgrade (7) $31,500,000 Class C Floating Rate Subordinate Notes Due 2013 -- Current Rating: C -- Prior Rating: Caa2, on review for downgrade (8) $8,500,000 Class LC Subordinate Loan Interests Due 2013 -- Current Rating: C -- Prior Rating: Caa2, on review for downgrade (9) $31,500,000 Class D Floating Rate Junior Subordinate Notes Due 2013 -- Current Rating: C -- Prior Rating: Ca This negative rating action reflects continued deterioration in the market value of the underlying assets due to: 1) continued price declines in the market value of the collateral portfolio in recent weeks, and 2) increased disparity between the marked-to-market values of the underlying assets and realized sales prices. In addition, Moody's noted that although the underlying assets comprise agency and non-agency Aaa-rated mortgage backed securities, current market turmoil makes asset valuation highly uncertain. WILLIAMS INDUSTRIES: Posts $572,000 Net Loss in Qtr. Ended Jan. 31 ------------------------------------------------------------------ William Industries Inc. reported a net loss of $572,000 on total revenue of $8.4 million for the second quarter ended Jan. 31, 2008, compared with a net loss of $143,000 on total revenue of $9.5 million in the same period ended Jan. 31, 2007. Included in the prior year's loss was a gain on land sale of $1.1 million. Without the land sale in 2007, the company's loss declined $707,000 when comparing the two quarters. At Jan. 31, 2008, the company's consolidated balance sheet showed $28.2 million in total assets, $26.4 million in total liabilities, $28,000 in minority interest, and $1.8 million in total stockholders' equity. Liquidity The company said that it continues to face a liquidity and business crisis, after suffering operating losses for several years, tapping its available sources of operating cash, and borrowing $3.7 million from its largest shareholder. The company is operating under a Forbearance Agreement with its major lender, United Bank, pursuant to which approximately $2.4 million was outstanding at Jan. 31, 2008, and is scheduled to be repaid by Aug. 1, 2008. Subsequent to Jan. 31, 2008, the company paid $500,000 to United Bank. Under the terms of the Forbearance Agreement, the company anticipates that United Bank will "term out" the remaining balance, possibly through 2011. The company is in default of nearly all of its other debts and leases. Balance Sheet The company's consolidated balance sheet at Jan. 31, 2008, also showed strained liquidity with $21.2 million in total current assets available to pay $22.3 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended Jan. 31, 2008, are available for free at http://researcharchives.com/t/s?2945 Going Concern Disclaimer McGladrey & Pullen LLP, in Vienna, Virginia, expressed substantial doubt about William Industries Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended July 31, 2007, and 2006. The auditing firm said that the company faces an overall liquidity crisis and the specific need to repay its $2.9 million United Bank debt by Dec. 31, 2007. About Williams Industries Williams Industries Inc. -- http://www.wmsi.com/ -- operates in the construction services market, providing specialized services to customers in the commercial, industrial, institutional and governmental markets. The company operates in two segments: manufacturing and construction. WOLVERINE TUBE: Completes $25MM Cash Sale of Small Tube Business ---------------------------------------------------------------- Wolverine Tube Inc. closed the sale of its Small Tube Products business to Standish Capital. The purchase price was $25 million cash plus a working capital adjustment as at the closing date, estimated to be approximately $3 million. The company relates that net proceeds from the sale will increase the company's cash balances. The Altoona, Pennsylvania-based operation produces precision redraw and cut tubing for a variety of applications including the welding, controls, transportation and electrical industries. This business has been included in Wolverine's commercial products segment. The transaction includes substantially all of the assets of this business plus assumption of certain liabilities. "The sale of the Altoona operations is in line with our focus on value added, heat transfer tubing products, fabricated products, and joining technology products," Harold M. Karp, President and Chief Operating Officer, stated. "The sale of this non-strategic asset enhances the company's liquidity and capital allocable to its core business and long term growth opportunities." Steven S. Elbaum, chairman, commented. About Wolverine Tube Inc. Headquartered in Huntsville, Alabama, Wolverine Tube Inc. (OTC:WLVT) -- http://www.wlv.com/ and http://www.silvaloy.com/ manufactures and distributes copper and copper alloy tubular products, fabricated and metal joining products, well as rod and bar products. The company focuses on developing and manufacturing tubular products with heat transfer capabilities used in engineered applications. The company's major customers' headquarters are in North America and include commercial and residential air conditioning and refrigeration equipment manufacturers, appliance manufacturers, industrial equipment manufacturers, utilities and other power generating companies, refining and chemical processing companies, and plumbing wholesalers. Wolverine classifies products as commercial products, wholesale products, and rod, bar and other products. * * * As reported in the Troubled Company Reporter on Nov. 22, 2007, Moody's Investors Service confirmed Wolverine Tube's Caa2 corporate family rating, Caa2 probability of default rating, and Caa3 senior unsecured rating (LGD4, 63%). The rating outlook was revised to negative from ratings under review. XERIUM TECH: Projected Bankruptcy Filing Spurs S&P's Junk Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating and bank loan ratings on Youngsville, North Carolina-based Xerium Technologies Inc. to 'CCC+' from 'B+'. At the same time, the ratings were placed on CreditWatch with negative implications. "The downgrade and CreditWatch placement reflect the increased likelihood of a bankruptcy filing, as Xerium announced that it expects to breach certain financial covenants under its current credit facility during the first quarter and future periods, which could constitute a default under the facility," said Standard & Poor's credit analyst James Siahaan. Xerium, a global manufacturer of clothing and roll covers used in the paper making process, is seeking relief from creditors and is attempting to privately place equity to help remedy the situation. However, these proposed solutions are unlikely to be satisfactory, given current credit and equity market conditions. Xerium also filed a Form 12b-25 report with the SEC, indicating that it would be unable to file its annual report in a timely fashion. The company requires additional time to determine the specifics of a possible asset impairment on its roll covers operation. The confluence of these issues has resulted in a dramatic weakening of the company's credit quality. S&P could lower the ratings further if Xerium fails to complete an equity issuance and rectify its covenant violation. * Fitch Says U.S. Home Improvement Spending Will Continue To Fall ----------------------------------------------------------------- A weaker economy, declining home prices, tighter credit standards and high energy costs will continue to take a toll on home improvement spending, according to Fitch Ratings. Director Robert Rulla will be the call leader and be joined in the presentation and Q&A by Managing Director Tom Razukas (tools, home furnishings) and Director Tiffany Co (home center retailers). Managing Director and lead homebuilding analyst Bob Curran will also be on hand for questions. 'Given the difficulties in the housing sector, some homeowners may be more cautious about investing in remodeling projects until there is a clear sign of home price stabilization,' said Rulla. 'Home improvement retailers will likely focus on strengthening their store bases and service levels to capture market share in the face of a challenging housing market.' * Moody's Adds Loan CDS Ratings to Market-Implied Ratings Platform ------------------------------------------------------------------ Moody's Analytics added ratings implied by loan credit default swap (LCDS) spreads to its Market Implied Ratings (MIR) platform. Moody's Market Implied Ratings are measures of relative credit risk that translate market prices into Moody's ratings symbols, allowing for comparisons of risk and valuation across various markets, as well as to Moody's own credit ratings. "Trades in the LCDS market provide a new source of information about the credit risk of senior secured loans, which have historically had much higher recovery in default relative to bonds," said Christopher Mann, Vice President in Moody's Credit Policy Group and developer of Moody's LCDS-implied ratings model. "One of the great strengths of the MIR platform is that the implied ratings are simple, intuitive, and allow for comparisons of risk and valuation across models and markets." LCDS-implied ratings are the sixth piece of Moody's Market Implied Ratings database, which already includes ratings implied from the bond, credit default swap, and equity markets, as well as from company accounting ratios. LCDS contracts are credit derivatives designed to track the credit quality of syndicated, senior secured loans. Moody's LCDS-implied ratings dataset is based on spreads provided by Markit Group, a leading provider of securities and derivatives prices, and currently includes daily rating histories on over 300 reference entities starting in August 2006. "LCDS-implied ratings are useful for predicting Moody's credit rating changes and discovering relative value opportunities," said David T. Hamilton, Senior Director in Moody's Credit Strategy group and co-author of Moody's LCDS-implied ratings methodology. "For example, we have found that LCDS trading rich for its rating tends to underperform the market over the next year." LCDS-implied ratings may also be used as inputs into synthetic CLO ratings models to derive implied tranche ratings. "CLO and LCDS index investors will find the data a unique and powerful analytical tool for tracking and predicting tranche performance," Hamilton concluded. * Moody's Valuation Expands Coverage to More Illiquid Securities ---------------------------------------------------------------- Moody's Analytics announced further expansion of its intraday and end-of-day valuation capabilities with the addition of cash loan coverage to its parsing product, Moody's CreditQuotes. CreditQuotes is the first in the industry to recognize and process the bids of over 6500 outstanding cash loans in the market. With the addition of cash loan coverage, Moody's CreditQuotes can now deliver daily valuation information on corporate bonds, loans, convertibles, credit default swaps (including LCDS and recoveries), and select ABS mortgages. "The market environment has led to an even greater need for valuation tools and transparency and Moody's is responding with broader coverage and with tools to help market participants evaluate even less liquid securities," said Yiannis Tsiounis, CEO of Moody's Credit Quotes. Starting in 2007 with the launch of the Moody's CreditValues suite of valuation tools, Moody's has delivered an array of valuation products to the fixed income market including Discounted Cashflow Valuations (model-based valuation for structured finance), Moody's CreditEvaluations (evaluated pricing for corporate and municipal bonds) and Moody's CreditQuotes (observed pricing for most major asset classes). Moody's CreditQuotes, created in January through the acquisition of BQuotes, provides price discovery tools, end-of-day pricing services and the UIN security master database for a wide range of fixed income securities, supplying the market with sophisticated tools that help assess the prices of complex securities with advanced parsing technology. * Moody's Says Commercial Real Estate Prices Declines in January ---------------------------------------------------------------- Commercial real estate prices as measured by Moody's REAL Commercial Property Price Indices (CPPI) dropped 0.6% in January, its third consecutive monthly decline. The decrease lowers the CPPI to a point that is approximately 2.4% below its peak value in October 2007. "After three consecutive down months, the run-up in prices from the last few years is clearly in the process of being eroded or reversed," says Sally Gordon, a Moody's Senior Vice President. Moody's expects commercial property prices to fall approximately 15-20% before bottoming out, but says several forces are at work to slow down recognition of the decline in the CPPI. These include a lengthening in the average holding period for property sales during the past year, supporting the assertion that recent sales are weighted toward "winners" that have realized more appreciation. The decline for January places the year-over-year increase in prices for the month at 4.5%, well below the 8.3% annual rate reported in December. The two-year change in prices was 12.5% for January, down from 17.4% as measured for December. The report also presents price changes based on different property types and geographical regions, including the ten MSAs with the most transactions. For the year ending with January, the standout strong performers were industrial properties in the Southern region and in Southern California, both of which experienced one-year appreciation in excess of 13%. Florida apartments were the biggest decliner, down 3.3% versus one year ago. Moody's REAL Commercial Property Prices Indices are based on the repeat sales of the same properties across the US at different points in time. Analyzing price changes measured in this way provides maximum transparency and methodological rigor. This approach also circumvents the distortions that can occur with other commercial property value measurements such as appraisals or average prices, says Moody's. * S&P Downgrades 32 Tranches' Ratings From 6 Cash Flows and CDOs ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 32 tranches from six U.S. cash flow and hybrid collateralized debt obligation transactions. S&P removed 28 of the lowered ratings from CreditWatch with negative implications. The downgraded tranches have a total issuance amount of $5.153 billion. At the same time, S&P placed the rating on one tranche on CreditWatch with negative implications. In addition, the ratings on four of the downgraded tranches from three transactions remain on CreditWatch with negative implications, indicating a significant likelihood of further downgrades. The CreditWatch placements primarily affect transactions for which a significant portion of the collateral assets currently have ratings on CreditWatch negative. Four of the six transactions are high-grade SF CDOs of ABS, which are CDOs collateralized at origination primarily by 'AAA' through 'A' rated tranches of RMBS 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. At the same time, S&P lowered its ratings on five tranches from five U.S. synthetic CDO transactions. The U.S. synthetic tranches are retranches of classes of notes from CDO of ABS transactions whose ratings are directly linked to the ratings on their respective reference obligations, which were lowered. These downgraded tranches have a total issuance amount of $75 million. 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 2,713 tranches from 634 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, 782 ratings from 194 transactions are currently on CreditWatch negative for the same reasons. In all, S&P has downgraded $257.729 billion of CDO issuance. Additionally, S&P's ratings on $98.920 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 ----------- ----- -- ---- GSC ABS Funding 2006-3g Ltd. CP NR A-1+/Watch Neg LBSPK 2007-1 SPC I Notes CC CCC-/Watch Neg LBSPK 2007-1 SPC II Notes CC CCC-/Watch Neg LBSPK 2007-1 SPC III Notes CC CCC-/Watch Neg LBSPK 2007-1 SPC IV Notes CC CCC-/Watch Neg LBSPK 2007-1 SPC V Notes CC CCC-/Watch Neg Lancer Funding II Ltd. A1J CC CCC-/Watch Neg Lancer Funding II Ltd. A1S CCC-/Watch Neg BB/Watch Neg Lincoln Avenue ABS CDO Ltd. A-1 CCC AAA/Watch Neg Lincoln Avenue ABS CDO Ltd. A-2 CC AA+/Watch Neg Lincoln Avenue ABS CDO Ltd. B CC BBB+/Watch Neg Lincoln Avenue ABS CDO Ltd. C CC B/Watch Neg Lincoln Avenue ABS CDO Ltd. D CC CCC-/Watch Neg Newbury Street CDO Ltd. A1 AAA AAA/Watch Neg Newbury Street CDO Ltd. A2 B AAA/Watch Neg Newbury Street CDO Ltd. A3 CCC+ AAA/Watch Neg Newbury Street CDO Ltd. A4 CCC- AAA/Watch Neg Newbury Street CDO Ltd. B CC AA/Watch Neg Newbury Street CDO Ltd. C CC A/Watch Neg Newbury Street CDO Ltd. D CC BBB/Watch Neg Silver Marlin CDO I Ltd. A-1 AAA AAA/Watch Neg Silver Marlin CDO I Ltd. A-2 BB/Watch Neg AAA/Watch Neg Silver Marlin CDO I Ltd. A-3 B-/Watch Neg AAA/Watch Neg Silver Marlin CDO I Ltd. A-4 CC AAA/Watch Neg Silver Marlin CDO I Ltd. B CC AA/Watch Neg Silver Marlin CDO I Ltd. C CC AA-/Watch Neg Silver Marlin CDO I Ltd. D CC A/Watch Neg Silver Marlin CDO I Ltd. E CC A-/Watch Neg Silver Marlin CDO I Ltd. F CC BBB/Watch Neg Toro ABS CDO II Ltd. A-1 A AAA/Watch Neg Toro ABS CDO II Ltd. A-2 BBB- AAA/Watch Neg Toro ABS CDO II Ltd. B BB AA/Watch Neg Toro ABS CDO II Ltd. C BB- AA-/Watch Neg Toro ABS CDO II Ltd. D B A/Watch Neg Toro ABS CDO II Ltd. E CCC BBB/Watch Neg Toro ABS CDO II Ltd. F CC BB+/Watch Neg Tricadia CDO 2007-8 Ltd. A-1VF CCC-/Watch Neg BB/Watch Neg Tricadia CDO 2007-8 Ltd. A-2 CC CCC-/Watch Neg Tricadia CDO 2007-8 Ltd. A-X CC CCC-/Watch Neg Tricadia CDO 2007-8 Ltd. B CC CCC-/Watch Neg Rating Placed on CreditWatch Negative Rating ------ Transaction Class To From ----------- ----- -- ---- Kefton CDO I Ltd. II CCC-/Watch Neg CCC- Other Outstanding Ratings Transaction Class Rating ----------- ----- ------ Kefton CDO I Ltd. III CC Kefton CDO I Ltd. IV CC Kefton CDO I Ltd. V CC Kefton CDO I Ltd. VI CC Kefton CDO I Ltd. VII CC Lancer Funding II Ltd. A2 CC Lancer Funding II Ltd. A3 CC Lancer Funding II Ltd. B CC Lancer Funding II Ltd. X BB/Watch Neg Tricadia CDO 2007-8 Ltd. C CC Tricadia CDO 2007-8 Ltd. D CC Tricadia CDO 2007-8 Ltd. E CC Tricadia CDO 2007-8 Ltd. F CC NR - Not rated. * S&P Downgrades Ratings on Six Classes Issued by Five CLTV Deals ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on six classes of mortgage asset-backed pass-through certificates issued by five second-lien high combined loan-to-value (CLTV) transactions. At the same time, S&P affirmed its ratings on various other second-lien high CLTV securitizations. The downgrades reflect projected credit support levels that are not sufficient to support the ratings at their previous levels. The 12-month average losses for Irwin 2002-A (loan group 2) and 2005-C (loan group 2) are $50,390 and $96,274, respectively. The 12-month average loss for MESA 2002-1 is 305,944. The 12-month average losses for Home Loan 2002-HI5 and 2004-HI1 are $160,474 and $356,831, respectively. As of the February 2008 remittance period, total and severe delinquencies (90-plus days, foreclosures, and REOs), as well as cumulative realized losses were: Irwin Whole Loan Home Equity Trust Series Total delinq.(i) Severe delinq.(i) Cum losses (ii) ------ ---------------- ----------------- --------------- 2002-A (G2) 10.81% 3.08% 10.11% 2005-C (G2) 3.38% 0.38% 2.52% MESA Global Issuance Co. Series Total delinq.(i) Severe delinq.(i) Cum losses (ii) ------ ---------------- ----------------- --------------- 2002-1 22.52% 13.60% 13.45% Home Loan Trust Series Total delinq.(i) Severe delinq.(i) Cum losses (ii) ------ ---------------- ----------------- --------------- 2002-HI5 5.18% 0.88% 7.45% 2004-HI1 6.92% 2.44% 6.91% (i)Percentage of the current pool balances. (ii)Percentage of the original pool balances. The affirmations of the ratings of the non-bond-insured transactions reflect sufficient levels of credit enhancement available to maintain the current ratings. The rating affirmations on the bond-insured transactions acknowledge the financial strength ratings of the bond insurers. Credit support for these transactions is generally provided by a combination of subordination, excess interest, overcollateralization, or bond insurance. Excess interest and overcollateralization solely provide credit enhancement to the most junior classes. The collateral backing these transactions consists primarily of loans originated for the purpose of debt consolidation, home improvement, or other reasons not specified by the borrower, with CLTV ratios in excess of 100%. Ratings Lowered Irwin Whole Loan Home Equity Trust Rating ------ Series Class To From ------ ----- -- ---- 2002-A II-B1 BB BBB 2005-C 2B-1 BB+ BBB- MESA Global Issuance Co. Rating ------ Series Class To From ------ ----- -- ---- 2002-1 B-1 CCC BBB 2002-1 B-2 D CCC Home Loan Trust Rating ------ Series Class To From ------ ----- -- ---- 2002-HI5 B B BB 2004-HI1 B B BB Ratings Affirmed Issue and series Class Rating Bear Stearns Home Loan Owner M-1 A Trust 2001-A M-2 BBB DLJ ABS Trust Series 2000-6 M-2 AA B-1 BBB- Empire Funding Home Loan Owner A-5 AAA Trust 1997-2 M-1 AA+ Empire Funding Home Loan Owner A-7 AAA Trust 1997-3 M-1 AA+ Empire Funding Home Loan Owner A-5 AAA Trust 1997-4 M-1 AA Empire Funding Home Loan Owner A-4 AAA Trust 1997-5 M-1 AA M-2 A Empire Funding Home Loan Owner A-5 AAA Trust 1998-2 M-1 AA+ M-2 A B-1 BBB- Empire Funding Home Loan Owner A-5 AAA Trust 1999-1 M-1 AA M-2 A B-1 BBB- FirstPlus Home Loan Owner M-1 AAA Trust 1997-2 M-2 AA+ B-1 AA FirstPlus Home Loan Owner A-8 AAA Trust 1997-3 M-1 AA+ M-2 AA- B-1 A- FirstPlus Home Loan Owner A-8 AAA Trust 1997-4 M-1 AA M-2 A FirstPlus Home Loan Owner A-8 AAA Trust 1998-1 M-1 AA M-2 A FirstPlus Home Loan Owner A-8 AAA Trust 1998-4 M-1 AA+ M-2 A B-1 BBB- FirstPlus Home Loan Owner A-9 AAA Trust 1998-5 M-1 AA M-2 A B-1 BBB- GMACM Home Loan Trust 2001-HLTV1 *A-I-7 AAA GMACM Home Loan Trust 2001-HLTV2 *A-I, *A-II AAA GMACM Home Loan Trust 2002-HLTV1 *A-I AAA GMACM Home Loan Trust 2004-HLTV1 *A-3, *A-4 A GMACM Home Loan Trust 2006-HLTV1 *A-2, *A-3 A *A-4, *A-5 A GRMT Mortgage Pass-Through Certificates Series 2001-1 *A-5NAS AAA M-1 A M-2 BBB B BB HLTV Mortgage Loan Trust 2004-1 A BBB Irwin Home Equity Loan IA-1 AAA Trust 2002-1 II M-1 AA+ II M-2 A II B-1 BBB Irwin Home Equity Loan M-2 A Trust 2003-1 B-1 BBB B-2 BBB- Irwin Home Equity Loan *IA-1, *IIA-1 AAA Trust 2006-1 *IIA-2, *IIA-3 AAA *IIA-4, VPN AAA Irwin Whole Loan Home Equity Trust 2002-A *IA-1 AAA II-M-1 AA+ II M-2 A Irwin Whole Loan Home Equity Trust 2003-A M-1 AA+ M-2 A B BBB Irwin Whole Loan Home Equity Trust 2003-B *IA AAA M A B BBB Irwin Whole Loan Home Equity Trust 2003-C M-1 AA M-2 A B-1 BBB B-2 BBB- Irwin Whole Loan Home Equity Trust 2003-D M-1 AA M-2 A B-1 BBB B-2 BBB- Irwin Whole Loan Home Equity Trust 2004-A M-1 AA M-2 A B-1 BBB B-2 BBB- Irwin Whole Loan Home Equity Trust 2005-B IA-1, 2A-1 AAA IM-1, 2M-1 AA IM-2, 2M-2 A 2M-3 BBB+ IM-3, 2M-4 BBB IM-4, 2B-1 BBB- 1B-1 BB+ 1B-2 BB Irwin Whole Loan Home Equity Trust 2005-C 1A-1, 2A-1 AAA 1M-1, 2M-1 AA 1M-2, 2M-2 A 1M-3, 2M-3 BBB 1M-4, 2M-4 BBB- 1B-1, 1B-2 BB+ Irwin Home Equity Loan Trust 2006-1 *IA-1 AAA *IIA-1, *IIA-2 AAA *IIA-3, *IIA-4 AAA Mego Mortgage Home Loan Owner Trust 1997-3 A-4 AAA M-1 AA M-2 A Mego Mortgage Home Loan Owner Trust 1997-4 A-4 AAA M-1 AA Preferred Credit Asst-Bckd Certs 1997-1 *A-6 AAA PSB Lending Home Loan Owner Trust 1997-3 M-1 AA+ M-2 A+ Certs BBB- Residential Funding Mortgage Securities II Home Loan Trust 1998-HI4 *Notes AAA Home Loan Trust 1999-HI1 *A-6 AAA Home Loan Trust 1999-HI4 *A-7 AAA Home Loan Trust 1999-HI6 *A-I-7, *A-I-8 AAA Home Loan Trust 1999-HI8 *A-I-7, *A-I-8 AAA Home Loan Trust 2000-HI1 *A-I-7 AAA Home Loan Trust 2000-HI2 *A-I-5 AAA Home Loan Trust 2000-HI3 *A-I-7 AAA Home Loan Trust 2000-HI4 *A-I-7 AAA Home Loan Trust 2000-HI5 *A-I-7 AAA Home Loan Trust 2000-HL1 *A-I-2 AAA Home Loan Trust 2001-HI1 *A AAA Home Loan Trust 2001-HI2 *A-I-7 AAA Home Loan Trust 2001-HI3 *A-I-7 AAA Home Loan Trust 2001-HI4 *A-7 AAA Home Loan Trust 2002-HI1 *A-7 AAA Home Loan Trust 2002-HI2 *A-I-7,* A-II AAA Home Loan Trust 2002-HI3 *A-7 AAA Home Loan Trust 2002-HI4 A-6 AAA M-1 AA M-2 A M-3 BBB Home Loan Trust 2002-HI5 A-7 AAA M-1 AA M-2 A M-3 BBB Home Loan Trust 2003-HI1 A-7 AAA M-1 AA M-2 A M-3 BBB B BB Home Loan Trust 2003-HI2 A-5,A-6 AAA M-1 AA M-2 A M-3 BBB B BB Home Loan Trust 2003-HI4 A-I-5 AAA A-II AAA M-1 AA M-2 A M-3 BBB B BB Home Loan Trust 2004-HI1 A-5 AAA M-1 AA M-2 A M-3 BBB+ M-4 BBB M-5 BBB- Home Loan Trust 2004-HI2 *A-4,*A-5 A Home Loan Trust 2004-HI3 *A-4,*A-5 A Home Loan Trust 2005-HI1 *A-4 A *A-5 A Home Loan Trust 2005-HI2 A-3, A-4 AAA A-5 AAA M-1 AA+ M-2 AA M-3, M-4 AA- M-5 A+ M-6 A- M-7 BBB+ M-8 BBB M-9 BBB- Home Loan Trust 2005-HI3 A-2, A-3 AAA A-4, A-5 AAA M-1 AA+ M-2 AA M-3 AA- M-4 A+ M-5 A M-6 A- M-7 BBB+ M-8 BBB M-9 BBB- Home Loan Trust 2006-HI1 A-1, A-2 AAA A-3, A-4 AAA M-1 AA+ M-2 AA M-3 AA- M-4 A+ M-5 A M-6 A- M-7 BBB+ M-8 BBB M-9 BBB- Home Loan Trust 2006-HI2 *A-1, *A-2 A *A-3, *A-4 A Home Loan Trust 2006-HI3 *A-1, *A-2 A *A-3, *A-4 A Home Loan Trust 2006-HI4 *A-1, *A-2 A *A-3, *A-4 A Home Loan Trust 2006-HI5 *A-1, *A-2 A *A-3, *A-4 A Home Loan Trust 2007-HI1 *A-1, *A-2 A *A-3, *A-4 A United National Home Loan Owner Trust 1999-1 A AAA M-1 AAA M-2 AA- * Denotes classes wrapped by bond-insurance. * S&P Downgrades Ratings on 44 Classes From 11 RMBS Transactions ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 44 classes from 11 residential mortgage-backed securities transactions backed by U.S. subprime mortgage loan collateral issued in 2006. At the same time, S&P removed all of the lowered ratings from CreditWatch with negative implications. In addition, S&P affirmed its ratings on 37 classes from 13 RMBS transactions backed by U.S. subprime loans and removed them from CreditWatch negative. All of the ratings had been placed on CreditWatch negative on Jan. 30, 2008. The downgrades reflect S&P's opinion that projected credit support for the affected classes is insufficient to maintain the previous ratings, given its current projected losses. S&P calculated its projected deal-specific losses utilizing 2006 subprime default curves. Due to current market conditions, S&P is assuming that it will take approximately 15 months to liquidate loans in foreclosure and approximately eight months to liquidate loans categorized as real estate owned. In addition, S&P is assuming a loss severity of approximately 45% for U.S. subprime RMBS transactions issued in 2006. The lowered ratings reflect S&P's assessment of credit support under two constant prepayment rate scenarios. The first scenario utilizes the lower of the lifetime or 12-month CPR, while the second utilizes a six-month CPR, which is very slow by historical standards. S&P assumed a constant default rate for each pool. Because the analysis focused on each individual class with varying maturities, prepayment scenarios may cause an individual class or the transaction itself to prepay in full before it incurs the entire loss projection. Slower prepayment assumptions lengthen the average life of the mortgage pool, which increases the likelihood that total projected losses will be realized. The longer a class remains outstanding, however, the more excess spread it generates. Standard & Poor's has updated its projected excess spread to account for the recent cuts in U.S. interest rates. In an upwardly sloping mortgage rate environment, Standard & Poor's announced that it would be discounting a portion of excess spread to account for potential interest rate modifications. An interest rate modification may extend the initial fixed-rate period of a mortgage loan to five years from two and three years. The reduction in interest rates has effectively extended the initial interest rates beyond the interest rate reset period. As a result of the reduction in excess spread, many loan modifications may no longer be needed. Standard & Poor'shas updated its assumptions on excess spread to reflect the current environment. In assessing the creditworthiness of each class, S&P reviewed the individual delinquency and loss trends of each transaction, changes, if any, in risk characteristics, servicing, and the ability to withstand additional credit deterioration. For pools that are continuing to show increasing delinquencies, S&P increased its cash flow stresses to account for potential increases in monthly losses. In order to maintain a rating higher than 'B', a class had to absorb losses in excess of the base case assumption S&P assumed in its analysis. For example, a class may have to withstand 115% of S&P's base case loss assumption in order to maintain a 'BB' rating, while a class had to withstand 125% of S&P's base case loss assumption to maintain a 'BBB' rating. Each class that has an affirmed 'AAA' rating can withstand approximately 150% of S&P's base case loss assumptions under its analysis, subject to individual caps assumed on specific transactions. S&P determined the caps by limiting the amount of remaining defaults to 90% of the current pool balances. Credit support for these transactions is provided through a combination of subordination, excess spread, and overcollateralization. The underlying collateral for these transactions consists of fixed- and adjustable-rate U.S. subprime mortgage loans that are secured by first and second liens on one- to four-family residential properties. To date, including the classes listed below and actions on both publicly and confidentially rated classes, S&P has resolved the CreditWatch placements of 276 classes from 50 U.S. RMBS subprime transactions from the 2006 and 2007 vintages. Currently, S&P's ratings on 2,328 classes from 465 U.S. RMBS subprime transactions from the 2006 and 2007 vintages are on CreditWatch negative. Standard & Poor's will continue to monitor the RMBS transactions it rates and take rating actions, including CreditWatch placements, when appropriate. Ratings Lowered and Removed From CreditWatch Negative Carrington Mortgage Loan Trust 2006-NC4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-NC4 M-2 14453MAG9 A AA/Watch Neg 2006-NC4 M-3 14453MAH7 BBB AA-/Watch Neg CWABS Asset-Backed Certificates Trust 2006-18 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-18 M-3 23243WAG3 A+ AA-/Watch Neg Fremont Home Loan Trust 2006-3 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-3 I-A-1 35729MAA5 A AAA/Watch Neg 2006-3 II-A-3 35729MAD9 A AAA/Watch Neg 2006-3 II-A-4 35729MAE7 BB AAA/Watch Neg 2006-3 M-1 35729MAF4 CCC AA-/Watch Neg Home Equity Asset Trust 2006-7 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-7 1-A-1 43709NAA1 A AAA/Watch Neg 2006-7 2-A-1 43709NAB9 A AAA/Watch Neg 2006-7 2-A-4 43709NAE3 A AAA/Watch Neg 2006-7 M-1 43709NAG8 B AA+/Watch Neg 2006-7 M-2 43709NAH6 CCC AA/Watch Neg 2006-7 M-3 43709NAJ2 CCC AA/Watch Neg 2006-7 M-4 43709NAK9 CCC AA-/Watch Neg MASTR Asset Backed Securities Trust 2006-NC3 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-NC3 A-1 55275RAA0 AA AAA/Watch Neg 2006-NC3 A-5 55275RAE2 AA AAA/Watch Neg 2006-NC3 M-1 55275RAF9 BB AA+/Watch Neg 2006-NC3 M-2 55275RAG7 CCC AA/Watch Neg 2006-NC3 M-3 55275RAH5 CCC AA-/Watch Neg Merrill Lynch Mortgage Investors Trust 2006-HE5 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE5 M-1 59022QAF9 AA AA+/Watch Neg 2006-HE5 M-2 59022QAG7 BBB AA/Watch Neg 2006-HE5 M-3 59022QAH5 BB AA/Watch Neg 2006-HE5 M-4 59022QAJ1 B AA-/Watch Neg Morgan Stanley ABS Capital I Inc. Trust 2006-HE6 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE6 M-1 61750FAG5 BB AA+/Watch Neg 2006-HE6 M-2 61750FAH3 B AA/Watch Neg 2006-HE6 M-3 61750FAJ9 CCC AA-/Watch Neg Morgan Stanley Capital I Inc. Trust 2006-HE2 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE2 M-2 617451EX3 BBB AA/Watch Neg 2006-HE2 M-3 617451EY1 B AA/Watch Neg 2006-HE2 M-4 617451EZ8 CCC AA-/Watch Neg Securitized Asset Backed Receivables LLC Trust 2006-HE2 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE2 M-1 81377AAF9 A AA+/Watch Neg 2006-HE2 M-2 81377AAG7 BB AA/Watch Neg 2006-HE2 M-3 81377AAH5 B AA-/Watch Neg Structured Asset Investment Loan Trust 2006-4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-4 A1 86360WAA0 BB AAA/Watch Neg 2006-4 A2 86360WAB8 BB AAA/Watch Neg 2006-4 A4 86360WAD4 AA AAA/Watch Neg 2006-4 A5 86360WAE2 BB AAA/Watch Neg 2006-4 M1 86360WAF9 CCC AA/Watch Neg 2006-4 M2 86360WAG7 CCC AA-/Watch Neg Structured Asset Securities Corporation Mortgage Loan Trust 2006-BC4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-BC4 A1 86359RAA4 BBB- AAA/Watch Neg 2006-BC4 A4 86359RAD8 A AAA/Watch Neg 2006-BC4 A5 86359RAE6 BBB- AAA/Watch Neg 2006-BC4 M1 86359RAF3 B AA+/Watch Neg 2006-BC4 M2 86359RAG1 CCC AA/Watch Neg 2006-BC4 M3 86359RAH9 CCC AA-/Watch Neg Ratings Affirmed and Removed From CreditWatch Negative Carrington Mortgage Loan Trust 2006-NC4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-NC4 M-1 14453MAF1 AA+ AA+/Watch Neg C-BASS Trust 2006-CB6 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-CB6 M-3 14986PAH6 AA- AA-/Watch Neg CWABS Asset-Backed Certificates Trust 2006-18 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-18 M-2 23243WAF5 AA AA/Watch Neg Fremont Home Loan Trust 2006-3 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-3 II-A-1 35729MAB3 AAA AAA/Watch Neg 2006-3 II-A-2 35729MAC1 AAA AAA/Watch Neg Home Equity Asset Trust 2006-7 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-7 2-A-2 43709NAC7 AAA AAA/Watch Neg 2006-7 2-A-3 43709NAD5 AAA AAA/Watch Neg JPMorgan Mortgage Acquisition Corp. 2006-FRE1 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-FRE1 M-1 46626LFN5 AA+ AA+/Watch Neg 2006-FRE1 M-2 46626LFP0 AA AA/Watch Neg 2006-FRE1 M-3 46626LFQ8 AA- AA-/Watch Neg MASTR Asset Backed Securities Trust 2006-NC1 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-NC1 M-1 57643LNG7 AA+ AA+/Watch Neg 2006-NC1 M-2 57643LNH5 AA AA/Watch Neg 2006-NC1 M-3 57643LNJ1 AA AA/Watch Neg 2006-NC1 M-4 57643LNK8 AA- AA-/Watch Neg 2006-NC3 A-2 55275RAB8 AAA AAA/Watch Neg 2006-NC3 A-3 55275RAC6 AAA AAA/Watch Neg 2006-NC3 A-4 55275RAD4 AAA AAA/Watch Neg Morgan Stanley ABS Capital I Inc. Trust 2006-HE6 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE6 A-1 61750FAA8 AAA AAA/Watch Neg 2006-HE6 A-2a 61750FAC4 AAA AAA/Watch Neg 2006-HE6 A-2b 61750FAD2 AAA AAA/Watch Neg 2006-HE6 A-2c 61750FAE0 AAA AAA/Watch Neg 2006-HE6 A-2d 61750FAF7 AAA AAA/Watch Neg 2006-HE6 A-2fpt 61750FAB6 AAA AAA/Watch Neg Morgan Stanley Capital I Inc. Trust 2006-HE2 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE2 A-1 617451ER6 AAA AAA/Watch Neg 2006-HE2 A-2a 617451ES4 AAA AAA/Watch Neg 2006-HE2 A-2b 617451ET2 AAA AAA/Watch Neg 2006-HE2 A-2c 617451EU9 AAA AAA/Watch Neg 2006-HE2 A-2d 617451EV7 AAA AAA/Watch Neg 2006-HE2 M-1 617451EW5 AA+ AA+/Watch Neg Securitized Asset Backed Receivables LLC Trust 2006-HE2 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-HE2 A-1 81377AAA0 AAA AAA/Watch Neg 2006-HE2 A-2A 81377AAB8 AAA AAA/Watch Neg 2006-HE2 A-2B 81377AAC6 AAA AAA/Watch Neg 2006-HE2 A-2C 81377AAD4 AAA AAA/Watch Neg 2006-HE2 A-2D 81377AAE2 AAA AAA/Watch Neg Structured Asset Investment Loan Trust 2006-4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-4 A3 86360WAC6 AAA AAA/Watch Neg Structured Asset Securities Corporation Mortgage Loan Trust 2006-BC4 Rating ------ Transaction Class CUSIP To From ----------- ----- ----- -- ---- 2006-BC4 A2 86359RAB2 AAA AAA/Watch Neg 2006-BC4 A3 86359RAC0 AAA AAA/Watch Neg * Consumer Staples Should Withstand Economic Slowdown, S&P Says --------------------------------------------------------------- The consumer staples sector should be resilient to any slowdown in consumer spending in 2008, although industry credit quality may take a hit, according to a report by Standard & Poor's Ratings Services. According to the report fairly inelastic demand for food, beverages, tobacco, and nondurable household and personal products should allow the sector to maintain a steady revenue stream. Even so, credit quality is likely to suffer overall because leverage looks high, and the consolidation trend continues to support merger and acquisition activity. "Typically, the consumer staples sector fares better than other sectors during economic downturns or periods of uncertainty," said Parul Jain, a director in Standard & Poor's Global Fixed-Income Research department. "The slowing economy and stubborn consumer price inflation are unlikely to dent spending on consumer staples." Companies with exposure to overseas markets will benefit from the weak dollar. However, sector profit margins will be hurt by rising input costs and interest expenses. Marginally higher unemployment rates, continued income growth, and household formation should support spending on staples. * S&P Reports Delinquencies Continue to Rise for Subprime RMBS -------------------------------------------------------------- Delinquencies among U.S. subprime residential mortgage-backed securities transactions originally rated in 2005, 2006, and 2007 have continued to increase, according to a recent performance report published by Standard & Poor's Ratings Services. As of the February 2008 distribution date, total delinquencies were 35.55%, 34.17%, and 24.38% of the current aggregate pool balances for the 2005, 2006, and 2007 vintages, respectively. This is an increase of approximately 4% for the 2005 vintage, 8% for 2006, and 10% for 2007 when compared with the January 2008 distribution date. Serious delinquencies (90-plus days, foreclosures, and real estate owned {REO}) have also risen since the last distribution date. As of the most recent reporting period, serious delinquencies for the 2005, 2006, and 2007 vintages were approximately 24.22%, 23.38%, and 15.24% of the current aggregate pool balances, respectively. When compared with the prior distribution date, serious delinquencies have increased by approximately 9% for the 2005 vintage, 11% for 2006, and 16% for 2007. The 2007 issuance year continues to be the worst-performing vintage in terms of cumulative losses. After 12 months of seasoning, cumulative losses for transactions issued in 2007 represent 0.48% of the original aggregate pool balance, which is 65% higher than the 0.29% recorded for the 2006 vintage at the same level of seasoning. * S&P Says Telecom Sector is Positioned to Handle Economic Setback ------------------------------------------------------------------ The improving financial profile and cyclically defensive nature of the telecom services sector place it in a relatively better credit-risk position for 2008 than seen at the beginning of the previous downturn, according to a report released by Standard & Poor's Ratings Services. A S&P report shows that on balance, credit quality is expected to hold steady. However, investment-grade companies are subject to higher downgrade risks than their speculative-grade counterparts, which now account for a huge 88.4% of the sector. Although some industry segments are mired in debt, and interest costs remain onerous, overall profit margins have improved. Some industry consolidation is still occurring, but the already high degree of industry consolidation, combined with less-than- favorable capital market conditions, limit merger and acquisition potential. Still, there are some notably weak players that could be acquisition targets in 2008. "The telecom services sector is well-positioned for handling the economic slowdown, as demand for telecom services by both households and businesses should remain strong," said Parul Jain, a director in Standard & Poor's Global Fixed-Income Research department. "Considerable restructuring and consolidation have taken place, suggesting that the worst is finally over for this sector," she said. The key risk is that stiff competition will limit price growth, which could then limit revenue growth and dent the high profit margins seen in 2007. However, robust consumer demand is fueling wireless growth at large firms, aiding revenue growth. Household telephony spending should continue increasing with rising household formation. Further support is expected as consumer use of wireless data services takes hold. An estimated 41% of U.S. households have neither cable modems nor DSL (digital subscriber lines), so the potential pool of new users remains high. * CRG Partners Transfers Los Angeles Office to a New Location ------------------------------------------------------------- CRG Partners disclosed that it has relocated its Los Angeles office over at: CRG Partners Group LLC 11835 West Olympic Boulevard East Tower, Suite 705 East Los Angeles, CA 90064 Tel: (310) 954-8755 Fax: (310) 954-8761 http://www.crgpartners.com/ CRG Partners is a provider of operational and financial restructuring services, specializing in creating value for the stakeholders of underperforming companies. CRG Partners has offices in Atlanta; Bethesda; Boston; Charlotte; Chicago; Dallas; Los Angeles; New York; and Vienna, Austria. * Donald Stern Joins Cooley Godward Kronish as Litigation Partner ----------------------------------------------------------------- Cooley Godward Kronish LLP disclosed that Donald K. Stern has joined the Firm as a partner in the litigation department. Stern, who was the U.S. Attorney for Massachusetts from 1993 to 2001, will be based in Cooley's 30-lawyer Boston office. He joins Cooley from Bingham McCutchen in Boston, where he has been in private practice for the past seven years. "Don is a nationally regarded civil and white collar litigator and a highly respected public figure in the Massachusetts bar," Michael Rhodes, head of Cooley's firmwide litigation practice, said. "His arrival reinforces Cooley's stature as a top-tier national litigation firm, and strengthens our rapidly growing presence in Boston." "We're obviously delighted to welcome him to the Firm," Mr. Rhodes added. In private practice, Stern has been involved in a wide range of litigation matters, including internal investigations and white collar defense, whistleblower complaints, class action defense and securities litigation. "Cooley has tremendous momentum and its litigation practice is working on some of the most dynamic matters in the country," Mr. Stern stated. "I am proud to join such an energetic and talented team of litigators and trial lawyers and am also excited about contributing to Cooley's continued growth in Boston." Stern earned a JD from Georgetown Law School and an undergraduate degree from Hobart College. He has been on the faculty of Boston College Law School and Harvard Law School. He is a frequent writer and speaker. Early in his career, Stern was an assistant attorney general in the Massachusetts Attorney General's office where he eventually served as chief of the Government Bureau. Prior to becoming U.S. Attorney, Stern served as chief legal counsel to former Massachusetts Governor Michael Dukakis. He was also previously a partner at Hale and Dorr. While in private practice over the last several years, Stern was tapped to lead a blue ribbon commission investigating the death of a college student accidentally killed by the Boston Police in the crowd that gathered after the Red Sox-Yankee playoffs in 2004. He was also appointed by the Governor to lead a commission investigating certain allegations involving the local Sheriff's Department. About Cooley Godward Cooley Godward Kronish LLP's -- http://www.cooley.com/-- 600 attorneys have an entrepreneurial spirit and deep, substantive experience, and are committed to solving clients' most challenging legal matters. From small companies with big ideas to international enterprises with diverse legal needs, Cooley has the breadth of legal resources to enable companies of all sizes to seize opportunities in today's global marketplace. The firm represents clients across a broad array of dynamic industry sectors, including technology, life sciences, financial services, retail and energy. The firm has full-service offices in major commercial, government and technology centers: Palo Alto, California; New York, New York; San Diego , California; San Francisco, California; Reston, Virginia; Broomfield, Colorado; Washington, District of Columbia and Boston, Massachusetts. * FTI Consulting Expands Service Scope with European Firms Buyout ----------------------------------------------------------------- FTI Consulting Inc. acquired Brewer Consulting Ltd. and Blueprint Partners, two European consultancies, to further broaden the portfolio of services it can offer its clients. Terms of the transactions were not disclosed. Brewer focuses on claims analysis, litigation support, construction program procurement consulting, and related training services. The firm is made up of a diverse and experienced team of quantity surveyors, engineers, and construction industry professionals, and is recognized as a provider of practical and value added solutions to complex issues confronting both owners and contractors. Brewer works closely with public and private owners, contractors, and developers to design processes to avoid or mitigate disputes and litigation. The firm will be integrated into FTI's Forensic and Litigation Consulting segment. Brewer's key principals, Geoff Brewer, Steve Briggs, Peter Brooker, Rob Palles-Clark, Owen Fox, Tim Haynes, Brian Meharg, and Alex Warrender have joined FTI as senior managing directors. Blueprint helps its clients to navigate the complex EU regulatory process as well as advises on their pan-European corporate communications strategies. It has particular expertise in industry sectors affected by public policy such as biotechnology & life sciences, financial services, environment & energy and technology. All of Blueprint's partners will remain with the business and it will be integrated into FTI's Strategic and Financial Communications segment. "We are very pleased to be adding these great businesses which extend our European platform in t0erms of both presence and capabilities," Jack Dunn, president and CEO of FTI, commented. "Brewer adds further strategic strength to our Construction practice by bringing its international dimension." "Their experience in damages calculations and capital project procurement consulting is very complementary to our existing, growing FLC/Construction Solutions practice," Mr. Dunn added. "We believe we are ideally positioned in an increasingly difficult market where we anticipate a growing incidence of disputes and a heightened focus on reducing risk in existing and developing projects." "Brussels is one of the world's most important political and regulatory hubs, and with Blueprint we are delighted to now be in this key market with a world-class communications service that complements FD, our Strategic & Financial Communications segment, extremely well," Mr. Dunn stated. "Joining FTI is an exciting step forward for us," Geoff Brewer, founder and chairman said. This transaction offers a tremendous opportunity to combine our strengths with FTI in forging a truly global service capability. We look forward to combining our litigation support and construction industry skills with the highly experienced team at FTI." "FD is one of the most successful strategic communications consultancies and our mutual fit is excellent," Julia Harrison, Blueprint's Managing Partner, added. "The combination of our businesses, and the ability to leverage all of FTI's capabilities, significantly adds to our ability to service clients internationally and in the wider communications field." About Brewer Consulting Ltd. Brewer Consulting provides professional consultancy services to the construction, engineering, transportation and oil & gas industries throughout the world. The company has practice in dispute resolution and procurement management. Clients can rely on the company's commitment in undertaking their assignments. Whatever the challenge, Brewer Consulting will find the solution that best meets its clients' needs. Founded in 1997, Brewer Consulting has primary operations in the United Kingdom and the United Arab Emirates. Brewer Consulting's clients include Fluor, Nakheel, Shell and Balfour Beatty Construction, and Brewer has been involved with such notable projects as Wembley Stadium, the Channel Tunnel Rail Link, the Burj Dubai and the Dubai Festival City. About Blueprint Partners Headquartered in Brussels, Blueprint Partners is a public affairs, policy advice and strategic communications consultancy. Established in 2003, Blueprint specialises in creating a dialogue with all of the company's clients' stakeholders through tailored and strategic programmes of advocacy, communications and media work, in Brussels and internationally. Its multinational team of 30 consultants, drawn from varied professional backgrounds, delivers innovative programmes for clients including blue-chip corporates and industry associations in the fields of ICT, chemicals, raw materials, retail and pharmaceuticals. About FTI Consulting FTI Consulting (NYSE: FCN) -- http://www.fticonsulting.com/-- is a business advisory firm dedicated to helping organizations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. With more than 2,400 professionals located in most major business centers in the world, the company works closely with clients every day to anticipate, illuminate, and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management and restructuring. * Sullivan & Worcester Forms Credit Crisis Task Force ----------------------------------------------------- Sullivan & Worcester LLP has formed a new practice group created to respond to the myriad of problems facing current and potential clients including increased loan defaults and restructurings, government investigations, bankruptcies and new regulation. Led by two senior partners, George P. Lindsay, Esq. in New York and Paul E. Summit, Esq. in Boston, the task force consists of litigators and finance, bankruptcy and other practitioners in the firm's Boston, New York and Washington, D.C. offices. The Group is intimately familiar with securitization and financial derivatives products, and its litigators have handled lawsuits and arbitrations involving financial disputes, securities law violations and fraud for investment and commercial banks, hedge funds, insurance companies, investors and corporate officers. "The goal of this practice is to help our clients prepare for and respond to the economic challenges precipitated by the sub-prime mortgage crisis to minimize the overall impact on their businesses," said George Lindsay. "Because this crisis affects a wide cross section of the business and investment communities, we intend to utilize the talents of attorneys in several of our other practice areas including tax law, real estate, investment management and securities law." "Over the last six months, banks and other financial institutions around the world have written off well over $150 billion in non- performing sub-prime assets. That may be only the start," added Paul Summit. "The full impact has not yet been registered by many institutions and we expect to see a wave of lawsuits from pension funds, municipalities, and other groups that have suffered massive losses." About Sullivan & Worcester Sullivan & Worcester LLP -- http://www.sandw.com/-- is a leading corporate law firm providing counsel to domestic and international clients ranging from Fortune 500 companies to emerging businesses. With more than 200 lawyers in Boston, New York and Washington, D.C., the firm offers services in a wide range of areas including corporate finance, securities, litigation, mergers and acquisitions, tax, real estate, private equity and venture capital, bankruptcy, regulatory law and employment and benefits. Sullivan & Worcester is also recognized for its representation of REITs and its deep expertise in energy and mutual fund law. For more information please visit. * BOND PRICING: For the Week of Mar. 17 - Mar. 20, 2008 ------------------------------------------------------- Issuer Coupon Maturity Price ------ ------ -------- ----- Abitibi-Cons Fin 7.875% 08/01/09 59 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 68 Alesco Financial 7.625% 05/15/27 45 Alion Science 10.250% 02/01/15 58 Allegiance Tel 12.875% 05/15/08 1 Alltel Corp 6.500% 11/01/13 73 Alltel Corp 6.800% 05/01/29 63 Alltel Corp 7.000% 03/15/16 72 Alltel Corp 7.875% 07/01/32 64 Ambac Inc 5.950% 12/05/35 71 Ambac Inc 6.150% 02/15/37 45 Ambassadors Intl 3.750% 04/15/27 71 AMD 5.750% 08/15/12 73 AMD 5.750% 08/15/12 74 AMD 6.000% 05/01/15 63 AMD 6.000% 05/01/15 64 Amer & Forgn Pwr 5.000% 03/01/30 54 Americredit Corp 0.750% 09/15/11 64 Americredit Corp 2.125% 09/15/13 65 Amer Color Graph 10.000% 06/15/10 29 Amer Media Oper 8.875% 01/15/11 66 Amer Meida Oper 10.250% 05/01/09 65 Ames True Temper 10.000% 07/15/12 50 Arris Group Inc 2.000% 11/15/26 71 Aventine Renew 10.000% 04/01/17 63 Arvinmeritor Inc 4.000% 02/15/27 68 Asbury Auto Grp 3.000% 09/15/12 75 Ashton Woods USA 9.500% 10/01/15 54 Assured Guaranty 6.400% 12/15/66 70 Atherogenics Inc 1.500% 02/01/12 15 Atherogenics Inc 4.500% 09/01/08 52 Atherogenics Inc 4.500% 03/01/11 18 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 73 Bank New England 8.750% 04/01/99 7 Bank New England 9.500% 02/15/96 13 Bank New England 9.875% 09/15/99 7 Bankunited Cap 3.125% 03/01/34 50 BBN Corp 6.000% 04/01/12 0 Bear Stearns Co 5.300% 04/15/29 74 Bear Stearns Co 5.350% 02/15/30 74 Bear Stearns Co 5.375% 02/15/30 75 Bear Stearns Co 5.430% 10/15/29 75 Beazer Homes USA 4.625% 06/15/24 70 Beazer Homes USA 6.500% 11/15/13 71 Beazer Homes USA 6.875% 07/15/15 72 Beazer Homes USA 8.125% 06/15/16 74 Beazer Homes USA 8.375% 04/15/12 74 Berry Plastics 10.250% 03/01/16 74 Bon-Ton Stores 10.250% 03/15/14 66 Borden Inc 7.875% 02/15/23 60 Borden Inc 8.375% 04/15/16 65 Borland Software 2.750% 02/15/12 67 Borland Software 2.750% 02/15/12 72 Bowater Inc 6.500% 06/15/13 63 Bowater Inc 9.500% 10/15/12 65 Broder Bros Co 11.250% 10/15/10 71 Budget Group Inc 9.125% 04/01/06 0 Buffet Inc 12.500% 11/01/14 2 Builders Transport 6.500% 05/01/11 0 Builders Transport 8.000% 08/15/05 0 Burlington North 3.200% 01/01/45 52 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 CBG Florida REIT 7.114% 05/29/49 69 CCH I LLC 11.000% 10/01/15 69 CCH I LLC 11.000% 10/01/15 70 Cell Genesys Inc 3.125% 11/01/11 66 Charming Shoppes 1.125% 05/11/14 70 Charter Comm Hld 10.000% 05/15/11 61 Charter Comm Hld 11.125% 01/15/11 67 Charter Comm Hld 11.750% 05/15/11 69 Charter Comm LP 5.875% 11/16/09 67 Charter Comm LP 6.500% 10/01/27 49 CIH 9.920% 04/01/14 48 CIH 10.000% 05/15/14 49 CIH 11.125% 01/15/14 49 CIT Group Inc 6.100% 03/15/67 65 CIT Group Inc 6.200% 09/15/21 72 CIT Group Inc 6.250% 11/15/21 71 Citizen Util Co 6.800% 08/15/26 73 Citizen Util Co 7.000% 11/01/25 74 Citizen Util Co 7.050% 10/01/46 70 Citizen Util Co 7.450% 07/01/35 74 Claire's Stores 9.250% 06/01/15 68 Claire's Stores 9.625% 06/01/15 58 Claire's Stores 10.500% 06/01/17 47 Clear Channel 4.900% 05/15/15 61 Clear Channel 5.500% 09/15/14 63 Clear Channel 5.500% 12/15/16 58 Clear Channel 5.750% 01/15/13 71 Clear Channel 6.875% 06/15/18 65 Clear Channel 7.250% 10/15/27 64 CMP Susquehanna 9.875% 05/15/14 66 Cogent Commnuications 1.000% 06/15/27 75 Collins & Aikman 10.750% 12/31/11 0 Columbia/HCA 7.050% 12/01/27 73 Columbia/HCA 7.500% 11/15/95 73 Comerica Cap TR 6.576% 02/20/37 65 Complete Mgmt 8.000% 08/15/03 0 Compucredit 3.625% 05/30/25 42 CompuCredit 5.875% 11/30/35 38 Conexant Systems 4.000% 03/01/26 68 Congoleum Corp 8.625% 08/01/08 74 Constar Intl 11.000% 12/01/12 62 Cooper-Standard 8.375% 12/15/03 74 Countrywide Finl 5.250% 05/11/20 70 Countrywide Finl 5.250% 05/27/20 69 Countrywide Finl 5.750% 01/24/31 68 Countrywide Finl 5.800% 01/27/31 68 Countrywide Finl 6.000% 03/23/21 73 Countrywide Finl 6.000% 04/06/21 73 Countrywide Finl 6.000% 04/13/21 74 Countrywide Finl 6.000% 05/16/23 69 Countrywide Finl 6.000% 03/16/26 69 Countrywide Finl 6.000% 07/23/29 69 Countrywide Finl 6.000% 11/22/30 70 Countrywide Finl 6.000% 11/14/35 69 Countrywide Finl 6.000% 12/14/35 68 Countrywide Finl 6.000% 02/08/36 68 Countrywide Finl 6.030% 08/25/20 74 Countrywide Finl 6.125% 04/26/21 74 Countrywide Home 6.150% 06/25/29 71 Countrywide Finl 6.200% 07/16/29 71 Countrywide Finl 6.250% 05/15/16 64 Countrywide Finl 6.300% 04/28/36 73 Crown Cork & Seal 7.500% 12/15/96 68 Curagen Corp 4.000% 02/15/11 71 Custom Food Prod 8.000% 02/01/07 0 CV Therapheutics 2.750% 05/16/12 74 CV Therapheutics 3.250% 08/16/13 73 Decode Genetics 3.500% 04/15/11 41 Decode Genetics 3.500% 04/15/11 53 Delta Air Lines 8.000% 12/01/15 65 Delta Air Lines 10.500% 04/30/16 70 Delphi Corp 6.197 11/15/33 20 Delphi Corp 6.500% 08/15/13 37 Delphi Corp 8.250% 10/15/33 29 Dillard Dept Str 7.750% 05/15/27 75 Dime Comm Cap I 7.000% 04/14/34 75 Dura Operating 8.625% 04/15/12 13 Dura Operating 9.000% 05/01/09 0 E*trade Finl 7.375% 09/15/13 70 E*trade Finl 7.875% 12/01/15 69 Empire Gas Corp 9.000% 12/31/07 0 Encore Capital 3.375% 09/19/10 72 Encysive Pharma 2.500% 03/15/12 51 EOP Operating LP 6.750% 02/15/12 70 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 Falcon Products 11.375% 06/15/09 0 Fedders North Am 9.875% 03/01/14 8 Fifth Third Cap 6.500% 04/15/37 75 Finova Group 7.500% 11/15/09 15 Finlay Fine Jwly 8.375% 06/01/12 39 First Data Corp 4.700% 08/01/13 68 First Data Corp 4.850% 10/01/14 62 First Data Corp 4.950% 06/15/15 56 First Data Corp 5.625% 11/01/11 74 Ford Motor Cred 5.400% 10/20/11 74 Ford Motor Cred 5.400% 10/20/11 74 Ford Motor Cred 5.500% 10/20/11 72 Ford Motor Cred 5.550% 09/20/11 73 Ford Motor Cred 5.600% 11/21/11 74 Ford Motor Cred 5.650% 01/21/14 69 Ford Motor Cred 5.750% 01/21/14 63 Ford Motor Cred 5.750% 02/20/14 65 Ford Motor Cred 5.750% 02/20/14 69 Ford Motor Cred 5.900% 02/20/14 73 Ford Motor Cred 6.000% 01/21/14 68 Ford Motor Cred 6.000% 03/20/14 70 Ford Motor Cred 6.000% 03/20/14 69 Ford Motor Cred 6.000% 03/20/14 70 Ford Motor Cred 6.000% 03/20/14 70 Ford Motor Cred 6.000% 11/20/14 65 Ford Motor Cred 6.000% 11/20/14 64 Ford Motor Cred 6.000% 11/20/14 73 Ford Motor Cred 6.000% 01/20/15 63 Ford Motor Cred 6.000% 02/20/15 69 Ford Motor Cred 6.050% 02/20/14 70 Ford Motor Cred 6.050% 03/20/14 66 Ford Motor Cred 6.050% 04/21/14 72 Ford Motor Cred 6.050% 12/22/14 69 Ford Motor Cred 6.050% 12/22/14 65 Ford Motor Cred 6.050% 12/22/14 62 Ford Motor Cred 6.050% 02/20/15 60 Ford Motor Cred 6.100% 02/20/15 65 Ford Motor Cred 6.150% 12/22/14 72 Ford Motor Cred 6.150% 01/20/15 70 Ford Motor Cred 6.200% 03/20/15 71 Ford Motor Cred 6.250% 12/30/13 74 Ford Motor Cred 6.250% 12/20/13 72 Ford Motor Cred 6.250% 04/21/14 72 Ford Motor Cred 6.250% 01/20/15 62 Ford Motor Cred 6.250% 03/20/15 67 Ford Motor Cred 6.300% 05/20/14 74 Ford Motor Cred 6.350% 04/21/14 73 Ford Motor Cred 6.500% 12/20/13 69 Ford Motor Cred 6.500% 02/20/15 64 Ford Motor Cred 6.500% 03/20/15 70 Ford Motor Cred 6.520% 03/10/13 72 Ford Motor Cred 6.550% 12/20/13 73 Ford Motor Cred 6.550% 07/21/14 67 Ford Motor Cred 6.600% 10/21/13 71 Ford Motor Cred 7.500% 08/20/32 67 Ford Motor Cred 7.550% 09/30/15 68 Ford Motor Cred 7.900% 05/18/15 71 Ford Motor Co 6.375% 02/01/29 59 Ford Motor Co 6.500% 08/01/18 64 Ford Motor Co 6.625% 02/15/28 60 Ford Motor Co 6.625% 10/01/28 60 Ford Motor Co 7.450% 07/16/31 64 Ford Motor Co 7.500% 08/01/26 61 Ford Motor Co 7.700% 05/15/97 64 Ford Motor Co 7.750% 06/15/43 62 Ford Motor Co 8.900% 01/15/32 72 Ford Motor Co 9.215% 09/15/21 73 Ford Holdings 9.300% 03/01/30 72 Fountainbleau La 10.250% 06/15/15 70 Franklin Bank 4.000% 05/01/27 69 Freescale Semico 10.125% 12/15/16 70 Fremont Gen Corp 7.875% 03/17/09 60 Frontier Airline 5.000% 12/15/25 58 Fulton Cap Trust 6.290% 02/01/36 72 General Motors 6.750% 05/01/28 58 General Motors 7.375% 05/23/48 62 General Motors 7.400% 09/01/25 66 General Motors 8.100% 06/15/24 70 General Motors 8.250% 07/15/23 71 General Motors 8.375% 07/15/33 72 Georgia Gulf Crp 7.125% 12/15/13 72 Georgia Gulf Crp 10.750% 10/15/16 64 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 67 Harrahs Oper Co 5.625% 06/01/15 60 Harrahs Oper Co 5.750% 10/01/17 58 Harrahs Oper Co 6.500% 06/01/16 61 Hawaiian TelCom 12.500% 05/01/15 75 Headwaters Inc 2.500% 02/01/14 71 Headwaters Inc 2.500% 02/01/14 71 Hechinger Co 9.450 11/15/12 2 Hercules Inc 6.500% 06/30/29 67 Herbst Gaming 7.000% 11/15/14 20 Herbst Gaming 8.125% 06/01/12 19 Hills Stores Co 12.500% 07/01/03 0 Hilton Hotels 7.500% 12/15/17 73 Hines Nurseries 10.250% 10/01/11 54 HNG Internorth 9.625% 03/15/06 19 Human Genome 2.250% 10/15/11 74 Human Genome 2.250% 08/15/12 70 Huntington Natl 5.375% 02/28/19 72 IDEARC Inc 8.000% 11/15/16 64 Ikon Office 6.750% 12/01/25 69 Ikon Office 7.300% 11/01/27 74 Imperial Credit 9.875% 01/15/07 0 Ion Media 11.000% 07/31/13 34 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 70 IT Group Inc 11.250% 04/01/09 0 JB Poindexter 8.750% 03/15/14 66 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 62 K Hovnanian Entr 6.250% 01/15/15 67 K Hovnanian Entr 6.250% 01/15/16 67 K Hovnanian Entr 6.375% 12/15/14 67 K Hovnanian Entr 6.500% 01/15/14 67 K Hovnanian Entr 7.500% 05/15/16 68 K Hovnanian Entr 7.750% 05/15/13 52 K Hovnanian Entr 8.000% 04/01812 73 K Hovnanian Entr 8.875% 04/01/12 53 Kaiser Aluminum 9.875% 02/15/02 0 Kaiser Aluminum 12.750% 02/01/03 3 Kemet Corp 2.250% 11/15/26 73 Kemet Corp 2.250% 11/15/26 73 Keycorp Cap VII 5.700% 06/15/35 69 Keystone Auto Op 9.750% 11/01/13 62 Kimball Hill Inc 10.500% 12/15/12 15 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 Landry's Restaurant 7.500% 12/15/14 75 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 50 MediaNews Group 6.875% 10/01/13 52 Merill Lynch 10.000% 03/06/09 22 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 53 New Plan Excel 5.250% 09/15/15 75 New Plan Realty 6.900% 02/15/28 59 New Plan Excel 7.500% 07/30/29 60 New Plan Realty 7.650% 11/02/26 54 New Plan Realty 7.680% 11/02/26 63 New Plan Realty 7.970% 08/14/26 57 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 Panamsat Corp 6.875% 01/15/28 70 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 69 Realogy Corp 12.375% 04/15/15 51 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 Wheeling-Pitt St 5.000% 08/01/11 59 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 67 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 ***