TCR_Public/080415.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Tuesday, April 15, 2008, Vol. 12, No. 89

                             Headlines

ACE SECURITIES: Moody's Junks Rating on Cl. M-4 S. 2005-SL1 Certs.
ALERIS INT'L: Posts $128MM Net Loss in Year Ended December 31
ALLIANCE BANCORP: Moody's Slashes Rating on Cl. M-2 Certs. to Caa2
AMES DEPARTMENT: Wants Plan Filing Deadline Moved to October 23
ANSLEY PARK: Moody's Junks Rating on $450MM Notes

ANTHRACITE CRE: Moody's Holds Ratings on Stable Performance
AUSTIN HOUSING: Moody's Holds 'B1' Rating on $9.135MM Bonds
AUSTIN HOUSING: Moody's Affirms B3 Rating with Neg. Outlook
AVALON RE: S&P Slashes Ratings to 'CC' After Steam Pipe Explosion
BANC OF AMERICA: Fitch Holds Low-B Ratings on Four Cert. Classes

BARRINGTON BROADCASTING: S&P Keeps 'B' Ratings; Outlook Now Neg
BEAR STEARNS: First Qtr. Earnings Dip to $115MM from 2007's $554MM
BEXLEY PLACE: Case Summary & Ten Largest Unsecured Creditors
BFWEST LLC: Has $205 Million in Debt to Creditors
BLOCKBUSTER INC: Extends $1.3BB Unsolicited Bid for Circuit City

BROWN SHOE: Operating Challenges Prompts S&P's Negative Outlook
CANADIAN TRUSTS: Investors Want ABCP Plan Voting Deadline Moved
CANADIAN TRUSTS: CIBC to Provide Funding for Canadian ABCP Rescue
CANADIAN TRUSTS: Canaccord to Redeem 97% of Clients' ABCP Stake
C-BASS: Poor Collateral Performance Cues Moody's to Cut Ratings

CALEDONIA MINING: Posts CN$4MM Net Loss in Year ended December 31
CHESAPEAKE CORP: Weak Performance Cues S&P to Chip Rating to 'B+'
CELSIA TECH: Modifies Debenture Interest Due Dates to May 2010
CITIUS II: Moody's Downgrades Ratings to C on $39 Million Notes
COBALT CMBS: Stable Performance Cues Fitch to Affirm Ratings

DELTA AIR: Deal with Pilots Clears Way for Northwest Merger
DELTA AIR: Board Votes "For" Merger with Northwest Airlines
DIRECT INSITE: December 31 Balance Sheet Upside-Down by $1 Million
EDM EQUIPMENT: Files Chapter 7 Liquidation in Nebraska
EDUCATION RESOURCES: Asks Court to Clarify Creditors' Info Access

EDUCATION RESOURCES: Wants to Hire EPIQ Bankruptcy as Claims Agent
EGPI FIRECREEK: To Restate Financial Statements Due to Errors
FINANCIAL GUARANTY: Explores Options, Including Capital Infusion
FIRST FRANKLIN: Moody's Lowers Ratings on 16 Certificate Classes
FLOWSERVE CORP: Moody's Holds Ratings and Changes Outlook to Pos.

FREMONT GENERAL: Inks $5.6 Bil. Asset Sale Deal with CapitalSource
FREMONT GENERAL: NYSE Suspends Shares Trading, Plans Delisting
FREMONT HOME: Fitch Slashes Ratings on $704.2MM Certificates
FREMONT HOME: Moody's Junks Rating on Cl. SL-A Certificates
FRONTIER AIRLINES: Denver Airport Rating Not Affected by Filing

FUSION TELECOM: Appoints Gordon Hutchins Jr. to President and CEO
GENERAL GROWTH: Moody's Cuts Unsecured Debt Rating to Ba2 from Ba1
GLOBAL CREDIT: S&P Designates 'B+' Ratings on Negative CreditWatch
GLOBAL TEL*LINK: Moody's Holds B2 CF Rating with Stable Outlook
GENERAL MOTORS: Idles Arlington Assembly Plant for Three Weeks

GMAC COMMERCIAL: Moody's Affirms 'C' Rating on $15.261MM Certs.
GORDON GANZ: Files for Bankruptcy After Closure of Grain Business
GOULD CITY: Council Decides to Hire Bankruptcy Attorney
GSC ABS: Poor Credit Quality Cues Moody's to Downgrade Ratings
HANCOCK FABRIC: Wants $100 Mil. GE Capital Exit Financing Approved

HAWTHORNE ON NORTH: Case Summary & 11 Largest Unsecured Creditors
HSBC HOME: Fitch Junks Ratings on 14 Certificate Classes
HUDBAY MINERALS: S&P Withdraws 'B+' Corporate Credit Rating
HUGHES NETWORK: S&P Changes Outlook to Stable; Retains 'B' Rating
JED OIL: December 31 Balance Sheet Upside-Down by $16 Million

JHT HOLDINGS: S&P Withdraws 'CCC+' Corporate Credit Rating
KIMBALL HILL: Lenders' Waiver Agreement Further Extended to May 9
LAM RESEARCH: S&P Changes Watch Posting of BB- Rating to Negative
LB-UBS COMMERCIAL: S&P Low-B Initial Ratings on Six Cert. Classes
LBI MEDIA: S&P Revises Outlook to Stable; Confirms 'B' Rating

LE-NATURE'S: Court Approves Second Amended Disclosure Statement
LE-NATURE'S: Amended Plan Confirmation Hearing Set on June 9
LENNAR CORP: Posts $88MM Net Loss in Quarter Ended February 29
LINEN 'N THINGS: Weak Operating Margin Prompts Moody's Caa2 Rating
MAIR HOLDINGS: Big Sky Unit Gets Default Notice from Mesa Air

MANITOWOC COMPANY: To Acquire Enodis In Deal Valued at $2.1 Bil.
MCDERMOTT SA: Fifth Amendment on Facility Won't Change S&P Ratings
MERRILL LYNCH: Fitch Downgrades Ratings on $134.1MM Certificates
MS LLC: Case Summary & 17 Largest Unsecured Creditors
MTR GAMING: Posts $11 Million Net Loss in Year ended December 31

N-45 FIRST: Moody's Lifts Rating to Ba1 from Ba2 on Class E Certs.
NEXSTAR BROADCASTING: S&P Assigns Ratings on Negative CreditWatch
NORANDA ALUMINUM: December 31 Balance Sheet Upside-Down by $76,000
NORTH FOREST: S&P Removes 'BB' Rating From CreditWatch Negative
NORTHWEST AIRLINES: Board Votes "For" Merger with Delta Air

NORTHWEST AIRLINES: Seeks Allowance for $5,954,902 ALPA Claims
NORTHWEST AIRLINES: Delta and Pilots Pact Clears Way for Merger
NORTHWEST AIRLINES: Dissolves NWA Inc. and NWA Holdings
NORTHWEST AIRLINES: Makes Four Additional Shares Distribution
ORIGINAL TOTAL: Case Summary & Five Largest Unsecured Creditors

PARAMOUNT RESOURCES: Earns $416.2 Million in Year Ended Dec. 31
PEACE ARCH: Insiders May Now Resume Share Trading
PERVASIP CORP: Appoints Scott Widham to Board of Directors
PHIBRO ANIMAL: Completes AIM Market Listing, Raises $45 Million
PILGRIM'S PRIDE: Cuts Weekly Production by 5% on Soaring Feed Cost

PLY GEM: Weak Housing Industry Prompts S&P's Negative CreditWatch
PSI CORP: Engages Seligson & Giannattasio as its Auditors
QUEBECOR WORLD: Seeks Approval to Hire KPMG (US) as Tax Advisor
QUEBECOR WORLD: Seeks Court on KPMG (Canada) as Tax Consultant
QUEBECOR WORLD: Wants Ernst & Young as Tax Services Provider

RAPTOR NETWORKS: Secures $3 Million Financing from Three Investors
SAXON ASSET: Fitch Chips Ratings on $354.9 Million Certificates
SCOTTISH RE: A.M. Best Downgrades Ratings and Put It Under Review
SKYBUS AIRLINES: Seeks Approval of Air Canada Settlement
SOLUTIA INC: Has 60,766,560 Outstanding Shares as of February 29

SOLUTIA INC: Settlement Pact with Solvay Gets Court Approval
SOLUTIA INC: Harbinger Entities Disclose 30.1% Equity Stake
SPANSION INC.: Inks Patent Cross-License Agreement with IBM
SPECIALTY UNDERWRITING: Fitch Cuts Ratings on Five Cert. Classes
STURGIS IRON: Court OKs Getzler Henrich as Financial Advisors

STURGIS IRON: Court Approves Dresser Hiring as Special Counsel
TAHERA DIAMOND: Last Day of Filing Bids for Assets is April 28
TAHERA DIAMOND: Wants MCTO Imposed; Gives Operational Update
TEKNI-PLEX INC: Inks Restructuring Pact with Key Stakeholders
TIENDAS DONATO: Case Summary & 30 Largest Unsecured Creditors

ULTRAPETROL LTD: Moody's Holds 'B2' CF Rating on $180 Mil. Notes
VIDEOTRON LTD: Prices $455 Mil. Notes Offering; Amends Facility
WACHOVIA CORP: Selling $7 Billion Common, Preferred Stocks
WACHOVIA CORP: Posts Net Loss of $350MM for Q1; To Cut Dividends
WACHOVIA BANK: S&P Upgrades Ratings on Two Classes From Low-Bs

WACHOVIA BANK: Moody's Affirms B3 Rating on $2.436MM Class O Cert.
WINDSTREAM CORP: S&P Changes Outlook to Stable; Holds 'BB+' Rating
WORNICK CO: Can Hire Kurtzman Carson as Claims and Noticing Agent
WORNICK CO: Judge Aug Approved Amended Disclosure Statement
WORNICK CO: Plan Confirmation Hearing Scheduled on June 23

* Fitch Says Positive Signs Emerged Despite Decline in US Housing
* S&P Downgrades 12 Tranches' Ratings From Six Cash Flows and CDOs
* S&P Assigns Ratings on 147 CDO Tranches on Negative CreditWatch

* David A. McKibbin Joins McDonald Hopkins-WPB Unit as Of Counsel
* Structured Finance Lawyer Mark S. Dola Joins King & Spalding

* Ascend Says US Major Airlines Face $110BB Fleet Upgrade Costs

* Large Companies with Insolvent Balance Sheets

                             *********

ACE SECURITIES: Moody's Junks Rating on Cl. M-4 S. 2005-SL1 Certs.
------------------------------------------------------------------
Moody's Investors Service has downgraded eight certificates and
placed on review for possible downgrade one class of certificates,
from two transactions issued by ACE Securities Corp. Home Equity
Loan Trust.  The transactions are backed by second lien loans.  
The certificates were downgraded because the bonds' credit
enhancement levels, including excess spread and subordination were
too low compared to the current projected loss numbers at the
previous rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second
collateral.  Substantial pool losses of over the last few months
have eroded credit enhancement available to the mezzanine and
senior certificates.  Despite the large amount of write-offs due
to losses, delinquency pipelines have remained high as borrowers
continue to default.

Complete rating actions are:

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2005-
SL1

  -- Cl. M-3, Downgraded to Ba3 from Ba1
  -- Cl. M-4, Downgraded to Caa2 from B1
  -- Cl. M-5, Downgraded to C from Caa2

Issuer: ACE Securities Corp. Home Equity Loan Trust, Series 2006-
SL2

  -- Cl. A, Downgraded to B1 from Baa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-1, Downgraded to Caa3 from Ba3
  -- Cl. M-2A, Downgraded to C from Caa1
  -- Cl. M-2B, Downgraded to C from Caa1
  -- Cl. M-3, Downgraded to C from Ca


ALERIS INT'L: Posts $128MM Net Loss in Year Ended December 31
-------------------------------------------------------------
Aleris International Inc. reported results for the fourth quarter
and full year ended Dec. 31, 2007.

For three months ended Dec. 31, 2007, the company incurred net
loss of $114.0 million compared to net income of $10.9 million for
the same period in the previous year.

The loss from continuing operations includes $51.2 million of
special items, including $21.6 million in restructuring and other
charges, $15.1 million from purchase accounting, and $11.2 million
in unrealized mark-to-market losses on derivative financial
instruments.

In addition, the fourth quarter results include amortization
expense of $9.2 million as a result of the company's acquisition
by Texas Pacific Group, an increase of $4.0 million from the
comparable period of 2006.

The continued softness in the North American building and
construction and automotive industries well as destocking in the
North American and European distribution industries impacted
fourth quarter shipment levels and profitability.

"Fourth quarter performance was significantly impacted by reduced
volumes in our Global Rolled and Extruded Products business,"
Steven J. Demetriou, chairman and chief executive officer, said.
"The U.S. construction and automotive industries continued to
weaken and demand in certain European end uses was impacted by
customer inventory destocking.  We have taken aggressive actions
to offset the reduced demand in North America, including the
announced closure of our Bedford, Ohio and Toronto, Canada paint
facilities, and the temporary reduction of manufacturing at our
Richmond, Virginia rolling mill."

"The cost performance of our European rolled products business in
the fourth quarter was negatively impacted by the complexity and
activity associated with the completion of our state-of-the-art
160" hot mill in Koblenz, Germany and the Duffel, Belgium plate
project.  However, both projects are successfully on-line and
production has met our expectations. Over the long-term, the
investment of capital into our European rolled products business
will allow us to expand our production of aerospace and other heat
treat plate and sheet, brazing sheet and other high-end product
offerings."

For full year 2007, the company has net loss of $128.6 million
compared to net income of $70.3 million in 2006.

The loss from continuing operations contains $146.2 million of
unfavorable special items including $104.3 million from purchase
accounting, $32.8 million of restructuring and other charges, and
$9.1 million in sponsor management fees.

In addition, the 2007 results include amortization expense of
$40.1 million, an increase of $33.0 million over 2006 as a result
of the TPG acquisition.

In 2006, Aleris reported revenues of $4.2 billion and income from
continuing operations of $30.8 million.  The 2006 results included
$98.5 million of unfavorable special items.

In addition, operating results were negatively impacted by
tightening scrap spreads in its North American specification alloy
business well as the higher costs of alloys and hardeners used in
the manufacturing process, negative effect of metal price lag and
approximately $32 million of out of the ordinary cost including
higher absorption, environmental reserves and other items.

Free cash flow from continuing operations for 2007 was
$421.7 million, driven by aggressive working capital management
that yielded increased turns from 5.2 to 6.6 per year and a
decrease in days of working capital from 70 to 56 in 2007 versus
2006.

During the fourth quarter, the company recorded $21.6 million of
restructuring and other charges.  These charges resulted from the
impairment of long-lived assets at the Monterrey, Mexico recycling
facility, the Toronto, Ontario paint facility, and the Bedford,
Ohio coating facility as a result of the announced closure of
those facilities and severance costs related to the departure of
certain executive officers.

Restructuring and other charges for the full year of $32.8 million
included the fourth quarter charges as well as costs associated
with several acquisitions that were not consummated and other
facility consolidations.  Approximately $9.5 million of the total
restructuring and other charges will result in cash payments,
primarily in 2008.

Capital expenditures were $191.8 million in 2007, compared with
$119.4 million for the previous year. The increase is primarily
attributable to a full year of the Corus Aluminum acquisition and
the expansion projects which accounted for $137.1 million of
capital expenditures in 2007.

The company ended the year with $2.7 billion of net debt and
$369 million of liquidity, excluding the impact of the Zinc sale.
Pro forma for the application of the net proceeds from the Zinc
sale, net debt was $2.4 billion as of Dec. 31, 2007.

Aleris' management has completed its assessment of the
effectiveness of the company's internal control over financial
reporting as required by Section 404 of the Sarbanes-Oxley Act of
2002.  Based upon its documentation, testing and evaluation,
Management has concluded that the company did not have effective
internal control over financial reporting as of Dec. 31, 2007;
within the context of the framework developed by the Committee of
Sponsoring Organizations of the Treadway Commission.

At Dec. 31, 2007, the company's balance sheet showed total assets
of $5.117 billion, total liabilities of $4.269 billion and total
shareholders' equity of approximately $0.848 billion.

                  About Aleris International Inc

Headquartered in Beachwood, Ohio, Aleris International Inc. (NYSE:
ARS) -- http://www.aleris.com/-- manufactures rolled aluminum    
products and offers aluminum recycling and the production of
specification alloys.  The company also manufactures value-added
zinc products that include zinc oxide, zinc dust and zinc metal.  
The company operates 42 production facilities in the United
States, Brazil, Germany, Mexico and Wales, and employs
approximately 4,200 employees.

                           *     *     *

Moody's Investor Service placed Aleris International Inc.'s long-
term corporate family rating at 'B2' in November 2006.  The rating
still holds to date with a stable outlook.


ALLIANCE BANCORP: Moody's Slashes Rating on Cl. M-2 Certs. to Caa2
------------------------------------------------------------------
Moody's Investors Service has downgraded seven certificates and
maintained on review for possible further downgrade four of those
classes of certificates from a transaction issued by Alliance
Bancorp Trust.  The transaction is backed by second lien loans.  
The certificates were downgraded because the bonds' credit
enhancement levels, including excess spread and subordination were
low compared to the current projected loss numbers at the previous
rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second
collateral.  Substantial pool losses of over the last few months
have eroded credit enhancement available to the mezzanine and
senior certificates.  Despite the large amount of write-offs due
to losses, delinquency pipelines have remained high as borrowers
continue to default.

Complete rating actions are:

Issuer: Alliance Bancorp Trust 2007-S1

  -- Cl. A-1, Downgraded to Baa3 from Aaa; Placed Under Review for
     further Possible Downgrade

  -- Cl. A-2, Downgraded to Baa3 from Aaa; Placed Under Review for
     further Possible Downgrade

  -- Cl. A-3, Downgraded to Baa3 from Aaa; Placed Under Review for
     further Possible Downgrade

  -- Cl. A-4, Downgraded to B3 from Aaa; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-1, Downgraded to Caa2 from Aa2
  -- Cl. M-2, Downgraded to Caa3 from B1
  -- Cl. M-3, Downgraded to C from Caa2


AMES DEPARTMENT: Wants Plan Filing Deadline Moved to October 23
---------------------------------------------------------------
Ames Department Stores asks the United States Bankruptcy
Court for the Southern District of New York to further extend
their exclusive periods to file a Chapter 11 plan and solicit
acceptances of that plan until Oct. 23, 2008, according to
Bloomberg News.

The report, citing court documents, says the Debtor filed its
plan and a related disclosure statement but has refrained from
soliciting votes pending a determination as to the solvency of
the Debtor's estates and recoveries under the plan.

A hearing is set on April 23, 2008, to consider the Debtor's
request, notes Bloomberg.

Founded in Southbridge, Massachusetts, Ames Department Stores
is a regional discount retailer that, through its subsidiaries,
currently operates 452 stores in 19 states and the District of
Columbia.

In 1990, Ames sought relief under Chapter 11 of the United States
Bankruptcy Code, blaming low profitability and consumers who
defaulted on their debt payments.

Rocky Hill, Connecticut-based Ames filed for chapter 11 protection
on Aug. 20, 2001 (Bankr. S.D.N.Y. Case No. 01-42217).  Togut,
Segal & Segal LLP and Weil, Gotshal & Manges LLP, represent the
Debtors in their restructuring efforts.  When the Company filed
for protection from their creditors, they listed $1,901,573,000 in
assets and $1,558,410,000 in liabilities.  On August 14, 2002,
Ames announced plans to go out of business, liquidate and close
all 327 stores.


ANSLEY PARK: Moody's Junks Rating on $450MM Notes
-------------------------------------------------
Moody's Investors Service has downgraded its rating of one class
of notes issued by Ansley Park ABS CDO, Ltd. The notes affected by
the rating action are:

Class Description: $450,000,000 Class A-1 Senior Secured Floating
Rate Notes Due 2046

  -- Prior Rating: B3, on review with future direction uncertain
  -- Current Rating: Caa3

Ansley Park ABS CDO, Ltd. is a collateralized debt obligation
backed primarily by a portfolio of RMBS securities and CDO
securities.  The transaction experienced an event of default under
the Indenture.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, holders of certain Notes
may be entitled to direct the Trustee to take particular actions
with respect to the Collateral Debt Securities and the Notes.  In
this regard, Moody's was informed by the Trustee that the majority
of the Controlling Class directed the Trustee to proceed with the
sale and liquidation of the Collateral in accordance with the
Indenture.  The Trustee also notified Moody's that it sold all of
the Collateral, made a final distribution and applied the proceeds
of the liquidation in accordance with applicable provisions of the
Indenture on March 27, 2008.  In that distribution, according to
the trustee, the only noteholders to receive a distribution of
liquidation proceeds were holders of Class A-1 Notes.  Available
funds were not sufficient to pay the Class A-1 Notes in full.

The rating actions taken reflect the changes in severity of loss
associated with certain tranches and reflect the final liquidation
distribution.


ANTHRACITE CRE: Moody's Holds Ratings on Stable Performance
-----------------------------------------------------------
Moody's Investors Service affirmed the ratings of 10 classes of
Notes issued by Anthracite CRE CDO 2006-HY3, Ltd. as:

  -- Class A, $174,457,251, Floating Rate Notes Due 2051, affirm
     at Aaa

  -- Class B-FL, $50,995,196, Floating Rate Notes Due 2051, affirm
     at Aa2

  -- Class B-FX, $8,946,526, Fixed Rate Notes Due 2051, affirm at
     Aa2

  -- Class C-FL, $42,048,671, Floating Rate Deferrable Interest
     Notes Due 2051, affirm at A2

  -- Class C-FX, $7,157,221, Fixed Rate Deferrable Interest Notes
     Due 2051, affirm at A2

  -- Class D, $12,525,136, Floating Rate Deferrable Interest Notes
     Due 2051, affirm at A3

  -- Class E-FL, $49,205,891, Floating Rate Deferrable Interest
     Notes Due 2051, affirm at Baa2

  -- Class E-FX, $4,473,263, Fixed Rate Deferrable Interest Notes
     Due 2051, affirm at Baa2

  -- Class F, $23,260,967, Floating Rate Deferrable Interest Notes
     Due 2051, affirm at Baa3

  -- Class G, $42,048,671, Fixed Rate Notes Due 2051, affirm at
     Ba2

Moody's is affirming all Notes due to overall stable pool
performance.

The collateral of Anthracite CRE CDO 2006-HY3, Ltd. is in the form
of a static pool and does not have reinvestment risk.  The deal
closed on May 23, 2006 and was fully-ramped up by Oct. 23, 2006.  
It employs a senior sequential and pro rata principal payment
structure. CMBS principal proceeds will be paid sequentially,
while proceeds from commercial real estate loans will be paid pro
rata to rated Notes prior to: 1) an Event of Default; or 2) the
date that the current collateral balance is greater than 50% of
the effective data balance.  BlackRock Financial Management, Inc.
serves as the Collateral Administrator.

As of the March 24, 2008 distribution date, the transaction's
aggregate bond balance has decreased to $596.5 million from
$645.4 million at issuance, mainly due to the pay-offs of four
commercial real estate loans (Lake Las Vegas Hyatt B-note, Wyndham
Hotel Portfolio Mezzanine loan, Lembi Portfolio Mezzanine loan,
and Palladium @ City Place Mezzanine loan) and the pay-downs from
four other commercial real estate loans (Windsor I B-note, GGP
Portfolio B-note, PPG Place Mezzanine loan, and PMSR Portfolio
Mezzanine loan).  The Notes are currently collateralized by 58
classes of CMBS securities from 15 separate transactions (74.8%)
and six commercial real estate loans (25.2%) consisting of three
B-notes (9.9%) and three Mezzanine loans (15.3%).

Since issuance, there have been no losses on the underlying
collateral.  Among the Moody's rated CMBS securities (32.6% of the
pool balance), there have been no upgrades, and one Moody's rated
CMBS security was downgraded.  Credit estimates were performed on
27 non-Moody's rated CMBS classes and underlying ratings were
updated on six commercial real estate loans (67.4% of the pool
balance).

Moody's uses a weighted average rating factor as an overall
indicator of the credit quality of a CDO transaction.  Based on
Moody's analysis, the current WARF is 5,357 compared to 5,811 at
issuance.  Moody's reviewed the ratings, performed credit
estimates, or updated the underlying ratings on all the collateral
supporting the Notes.  The distribution is as follows: Baa1-Baa3
(7.6% compared to 5.5% at issuance); Ba1-Ba3 (21.3% compared to
21.6% at issuance); B1-B3 (23.6% compared to 22.4% at issuance)
and Caa1-NR (47.6% compared to 50.5% at issuance).


AUSTIN HOUSING: Moody's Holds 'B1' Rating on $9.135MM Bonds
-----------------------------------------------------------
Moody's Investors Service has affirmed the B1 rating on Austin
Housing Finance Corporation Multifamily Housing Revenue Bonds
(Stony Creek/Princeton Apartments Project), Series 1999 A, of
which $9,135,000 remain outstanding.  

The outlook remains negative based on thin financial performance
and fluctuating occupancy levels that will need to stabilize for
sometime before considering an outlook change.  The taxable Series
1999B bonds have matured on Nov. 1, 2004 and no longer carry
Moody's rating.

Legal Security: The bonds are limited obligations payable solely
from the revenues, receipts and security from the two properties.  
Stony Creek is a 132-unit multifamily rental housing facility
constructed in 1982, located in the Southwest Austin submarket of
Texas.  Princeton Apartments is a 90-unit multifamily rental
housing facility constructed in 1965, and is located in the East
Austin submarket.

Credit Strengths

  -- Current occupancy rate at Princeton increased to 87% from 83%
     since Moody's last update in August 2007 and is projected to
     reach 90% by next quarter.

  -- Fully funded Debt Service Reserve Fund ($805,000) and
     partially funded Renewal and Replacement Fund ($84,461)
     provide additional security for bondholders.

  -- The owner recently engaged Capstone Real Estate Service, a
     local company that specializes in multifamily housing to
     manage both properties.

Credit Challenges

  --Thin but improving debt service coverage level of 1.04 times
     based on un-audited, 12-month operating statement, ending
     December 2007.

  -- Replacement and Reserve Fund is underfunded and will likely
     not be replenished in the immediate future.

  -- A significant number of tenants at Princeton have Section 8
     vouchers, which generally contributes to stable rent revenue
     and occupancy but limits management's ability to maximize
     rental income amid increasing expenses.

  -- The property is subject to rental housing restrictions such
     as  limitation on tenants' income and rent on certain units,
     restricting both revenue and the pool of potential tenants

Recent Developments/Results:

The un-audited 12 moth operating statement ending December 2007
shows somewhat thin but improving financial performance.  Revenues
declined by about 3% in 2007 from 2006 level but operating
expenses also declined by more than 9%, resulting in the adjusted
debt service coverage of 1.04 times, calculated based on Maximum
Annual Debt Service of $805,000.  Debt service coverage was
adjusted to include the required deposit into the Replacement and
Repair Fund.  Excluding such deposit, the ratio would increase to
1.12 times.  The decline in expenses was largely due to a decline
in contracted services and administrative expenses.  Rent levels
at the project have remained the same over the past few years and
no increases are expected in the immediate future.

The Replacement and Repair Reserve Fund remains underfunded
($84,461) and Moody's does not anticipate the properties will
replenish it in the near term.  However, the debt service reserve
fund has remained untapped to-date which provides additional
security for bondholders.

Princeton Apartments which experienced significant declines in
occupancy in the past couple of years is now showing signs of
improvements.  Current physical occupancy increased to 87% from
83% since our last update on August 2007.  The owner projects the
occupancy rate to reach 90% by next quarter due to improving
neighborhood that is expanding with a new hospital and more retail
stores opening up nearby, resulting in more traffic but no new
significant competition for the property.  Further, the owner
completed a significant rehabilitation of the property which
improved its appeal.  Stony Creek Apartments, on the other hand,
has always had stronger occupancy rate than Princeton Apartments
which currently stands at 94%.  Unlike Princeton, Stony Creek is
experiencing some competition from new multifamily housing
developments but the owner does not foresee any immediate impact
on the property.

The property owner has recently changed property management from
Arbor Property Management to Capstone Real Estate Service, a local
company that specializes in multifamily housing.  Capstone was
founded in 1969 and currently manages about 53,000 multi-family
units and 1,000,000 square feet of commercial space nationwide.  
Capstone is expected to use its expertise in the multifamily
housing and knowledge of the service area to improve performance
at both properties.  Capstone's near term focus is to increase and
maintain high occupancy levels while keeping cost low.

Outlook

The outlook for the bonds remains negative due to thin margins and
low but increasing occupancy at Princeton.

What could change the rating -UP

  -- Continued improvement in debt service coverage and
     replenishment of Replacement and Repair Fund would put an
     upward pressure on the rating.

What could change the rating -DOWN

  -- Significant decrease in revenues due to increase in vacancy
     or expenditures that results in weaker project operating
     performance could result in a downgrade.


AUSTIN HOUSING: Moody's Affirms B3 Rating with Neg. Outlook
-----------------------------------------------------------
Moody's Investors Service has affirmed the B3 rating on Austin
Housing Finance Corporation Multifamily Housing Revenue Bonds
(Rutland Place Apartments Project), Series 1998 A, of which
$11,675,000 remain outstanding.  The B3 rating affirmation is
based upon Moody's review of unaudited, 12-month operating
statement ending December 2007 and current occupancy reports
provided by the property owner.

The negative outlook has been affirmed due to length of time it
will take to replenish Debt Service Reserve Fund and the
Replacement and Repair Fund, both currently well below levels
required pursuant to the transaction documents.  Further, current
physical occupancy declined to mid 80s due to fire in one of the
apartment buildings January 2008 that affected 16 units.  
Mitigating this concern is the fact the property is insured and
renovation of affected units has started.  The owner has loss of
rent insurance but the level of coverage and impact on debt
service coverage is unknown at this time.

The taxable Series 1998B bonds have matured on Nov. 1, 2005 and no
longer carry Moody's rating.

Legal Security: The bonds are limited obligations payable solely
from the revenues, receipts and security from the project which is
a 294-unit multifamily housing development located in North
Central Austin submarket, and is comprised of 16 garden style
apartment buildings (known as Rutland Place I) and 15 other
apartment buildings (known as Rutland Place II).  Phase I was
built in 1979 and Phase II was built in 1985.

Credit Strengths

  -- The property has been generating positive cash flow over the
     past couple years, which excess is being used to replenish
     the Debt Service Reserve Fund but Moody's does not expect
     full funding in the near term.

  -- The owner recently engaged Capstone Real Estate Service, a
     local company that specializes in multifamily housing to
     manage both properties.

  -- According to market data provided by Torto Wheaton Research,
     occupancy in the submarket is forecasted to remain stable
     while rent is forecasted to grow.

Credit Challenges

  -- Current physical occupancy has declined from an average of
     95% to 84% due to fire in one of the buildings affecting 16
     units, 5.4% of total units, but the property is insured for
     loss of rent.

  -- Debt Service Reserve Fund balance is $107,504 as of Dec. 31,
     2007, 12% of total requirement, and Replacement and Repair
     Fund is depleted.

  -- Thin debt service coverage level of 1.08 times assuming
     regularly scheduled deposits into the Replacement and Repair
     Fund based on un-audited, 12-month operating statement ending
     Dec. 31, 2007, but a notable improvement from 0.98% in the
     prior 12-month period.

  -- The property is subject to rental housing restrictions such
     as income limitations restricting the pool of potential
     tenants as well as owner's ability to maximize rental income.

Recent Developments/Results:

The unaudited operating statement shows improved debt service
coverage level to 1.08 from 0.98 times assuming regularly
scheduled deposits into the Replacement and Repair Fund and 1.16
times from 1.06 times in 2006 when excluding such deposit.  The
project has been able to generate excess cash flows, which is
being used to replenish the Debt Service Reserve Fund which
increased slightly to $107,504 as of Dec. 31, 2007 from
$101,000 for same period in 2006.  Given the challenges that the
project faced in the recent past during which time it needed to
rely on various surplus funds to pay for operating, maintenance
and repair and replacement needs over the past three years as well
as to pay debt service on the bonds, both the Operating Reserve
Fund and Replacement and Repair Fund are currently unfunded.

Current physical occupancy has declined to about 84% due to fire
in January 2008 that affected 16 units.  The owner will be
collecting loss of rent insurance but it's premature to determine
the level of coverage and assess the impact on debt service
coverage at this time.  There is a significant competition from
other multifamily developments in the area and immediate return to
prior occupancy levels upon completion of renovation which already
started remains somewhat uncertain.  Offsetting this concern is
the fact that affected apartments will likely be more attractive
and appealing to potential tenants upon completion of the
renovation.  According to property owner, it will take eight to
ten months to redo the damaged apartments.

TWR also forecasts that occupancy in the property submarket (North
Central Austin) will increase in the next three years, estimating
94.2% in 2008, 94.7% in 2009 and 95.3% in 2010.  Moody's believes
that B3 rating for the bonds is appropriate and reflects the thin
debt service coverage and tap on reserves.  Further, the
volatility the project is currently experiencing justifies the
negative outlook.

                            Outlook

The rating outlook for the bonds remains negative based upon the
underfunded reserve funds which will require the project to be
stable for some time to be fully replenished, declining occupancy
and uncertainty surround insurance coverage and return to prior
occupancy levels.

What could change the rating -UP

  -- Fully funded reserves
  -- Significant improvement in debt service coverage

What could change the rating -DOWN

  -- Continued tapping Debt Serve Reserve Fund to pay bondholders
     or a default on the bonds.


AVALON RE: S&P Slashes Ratings to 'CC' After Steam Pipe Explosion
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its subordinated debt
rating on Avalon Re Ltd.'s Class C notes to 'CC' from 'CCC-'.  The
action follows notification from HSBC Bank (Cayman) Ltd. that the
steam pipe explosion that occurred in New York City on July 18,
2007, would be a covered event under the terms of the reinsurance
agreement between Avalon Re Ltd. and Oil Casualty Insurance Ltd.
      
"To date, Avalon Re Ltd. has experienced $297 million of covered
losses due to Hurricane Katrina and the explosion at the
Buncefield oil depot," said Standard & Poor's credit analyst Gary
Martucci.  "This leaves only $3 million of covered losses that can
be incurred prior to any losses being borne by the Class C
noteholders."
     
The covered-loss report indicated that losses could be as high as
$50 million.  The final determination of the loss payment is not
expected to occur in the near future.
     
Although the losses will reduce the amount of subordination
supporting the Class A and B notes, Standard & Poor's is not
taking action on the Class A and B notes, which are currently
rated 'B+' and 'CCC', respectively.  Standard & Poor's has been
told that there are currently no claims under review that are
expected to cause additional losses to Avalon Re. Ltd.  The notes
are scheduled to mature on June 6, 2008, though they are subject
to extension under terms set forth in the transaction documents.


BANC OF AMERICA: Fitch Holds Low-B Ratings on Four Cert. Classes
----------------------------------------------------------------
Fitch Ratings has affirmed these Banc of America Commercial
Mortgage Inc., series 2003-2, commercial mortgage pass-through
certificates:

  -- $47.2 million class A-1 at 'AAA';
  -- $451.5 million class A-1A at 'AAA';
  -- $106.3 million class A-2 at 'AAA';
  -- $168.1 million class A-3 at 'AAA';
  -- $482.3 million class A-4 at 'AAA';
  -- Interest-only class XC at 'AAA';
  -- Interest-only class XP at 'AAA';
  -- $56.7 million class B at 'AAA';
  -- $21.0 million class C at 'AAA';
  -- $44.1 million class D at 'AAA';
  -- $23.1 million class E at 'AAA';
  -- $21.0 million class F at 'AA';
  -- $23.1 million class G at 'AA-';
  -- $21.0 million class H at 'A';
  -- $18.9 million class J at 'BBB+';
  -- $10.5 million class K at 'BBB-';
  -- $10.5 million class L at 'BB';
  -- $8.4 million class M at 'BB-';
  -- $8.4 million class N at 'B+';
  -- $4.2 million class O at 'B';
  -- $2.7 million class BW-A at 'AAA';
  -- $1.2 million class BW-B at 'AAA';
  -- $8.7 million class BW-C at 'AAA';
  -- $2.6 million class BW-D at 'AAA';
  -- $3.6 million class BW-E at 'AAA';
  -- $3.2 million class BW-F at 'AAA';
  -- $3.1 million class BW-G at 'AAA';
  -- $2.6 million class BW-H at 'AAA';
  -- $2.6 million class BW-J at 'AAA';
  -- $2.1 million class BW-K at 'AAA';
  -- $3.5 million class BW-L at 'AAA'.

Fitch does not rate the $27.1 million class P or classes HS-A,
HS-B, HS-C, HS-D or HS-E.

The affirmations are due to the stable performance and minimal pay
down of the pool.  As of the March 2008 distribution date, the
pool's aggregate certificate balance has decreased 7% to
$1.64 billion from $1.77 billion at issuance.  In total 43 loans
(33.6%) have defeased, including 1328 Broadway (7.9%), a shadow
rated and second largest loan in the pool.

In February 2008, one (0.7%) loan transferred to special servicing
due to imminent default.  The loan is secured by a 121-unit
multifamily property in Laramie, Wyoming.  The coupon rate is 4.9%
and maturity is August 2014.  The service-reported September 2007
occupancy was 53% and debt service coverage ratio was 0.58 times.

Hines-Sumitomo Portfolio (12.8%) and Newgate Mall (2.6%) maintain
their investment grade shadow ratings based on stable loan
performance.

The Hines Sumitomo portfolio, the largest loan in the pool, is
secured by three office properties, two of which are located in
New York, New York and the third in Washington, DC.  Occupancy has
remained stable compared to issuance occupancy of 98.9%.  The loan
is interest only with a maturity date in 2013.  The senior pooled
portion has a coupon of 4.78% and the non-pooled portion has a
coupon of 4.98%

Newgate Mall is a 724,619 square feet anchored retail center in
Ogden, Utah.  Occupancy remained stable at 98.3% from 94.7% at
issuance.  The loan is a balloon with a coupon rate of 4.8% and
maturity in 2010.

Only 0.8% of the pool matures in 2008 and no loans are scheduled
to mature in 2009.  The weighted average coupon rate is 5.4%.   
There are currently 13 (6%) Fitch loans of concern due to
declining DSCR or occupancy.


BARRINGTON BROADCASTING: S&P Keeps 'B' Ratings; Outlook Now Neg
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Hoffman
Estates, Illinois-based Barrington Broadcasting LLC to negative
from stable.  At the same time, S&P affirmed all ratings on the
company, including the 'B' corporate credit rating.
      
"The outlook revision reflects the difficulties that we believe
the company faces over the intermediate term in making meaningful
debt reductions and increasing EBITDA," said Standard & Poor's
credit analyst Jeanne Mathewson, "both of which will be essential
to complying with an aggressive covenant-tightening schedule."   
Two-year average EBITDA, which smoothes the effects of advertising
and Olympics cycles, is used in the covenants' EBITDA definition.


BEAR STEARNS: First Qtr. Earnings Dip to $115MM from 2007's $554MM
------------------------------------------------------------------
Bear Stearns Companies Inc. submitted financial results for the
quarter ended Feb. 29, 2008 with the Securities and Exchange
Commission.  The company's net income decreased to $115 million
for the quarter ended Feb. 29, 2008, compared to $554 million for
the same quarter last year.  Total revenues dipped to $3.4 billion
for the quarter ended Feb. 29, 2008, compared to total revenues of
$4.7 billion for the same period last year.

Bear Stearns experienced a significant liquidity crisis during the
end of the week of March 10, 2008, that seriously jeopardized its
financial viability.  On March 16, 2008, the company and JPMorgan
Chase & Co. entered into an agreement and plan of merger following
the significant liquidity crisis.  On March 24, 2008, the company
and JPMorgan Chase entered into an amendment to the agreement and
plan of merger.  The Merger Agreement provides that, upon the
terms and subject to the conditions set forth in the Merger
Agreement, a wholly owned subsidiary of JPMorgan Chase will merge
with and into the company with the company continuing as the
surviving corporation and as a wholly owned subsidiary of JPMorgan
Chase.

The results for the three months ended Feb. 29, 2008, includes
approximately $600 million in net inventory markdowns during the
2008 quarter primarily related to losses experienced in the
mortgage-related and leveraged finance areas, as a result of
extremely challenging market conditions.

Bear Stearns said its net income and revenues will be adversely
impacted in the event JPMorgan Chase terminates its operating
guaranty in respect of certain trading and other obligations of
the company and certain of the company's subsidiaries or its
guaranty to the Federal Reserve Bank of New York of the company's
borrowings from the Federal Reserve Bank of New York at the Prime
Dealer Discount Window.

The company said it faces significant legal risks in its
businesses, and the volume of claims and amount of damages and
penalties claimed in litigation and regulatory proceedings against
financial institutions have been increasing.

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'.


BEXLEY PLACE: Case Summary & Ten Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Bexley Place, L.P.
        5817 Allentown Way
        Temple Hills, MD 20748
        Tel: (301) 440-6025

Bankruptcy Case No.: 08-14869

Chapter 11 Petition Date: April 8, 2008

Court: District of Maryland (Greenbelt)

Judge: Wendelin I. Lipp

Debtor's Counsel: Stanton J. Levinson, Esq.
                     (tiger110@earthlink.net)
                  P.O. Box 1746
                  Silver Spring, MD 20915
                  Tel: (301) 649-7888

Estimated Assets: $1,000,001 to $10 million

Estimated Debts:  $1,000,001 to $10 million

Debtor's Ten Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Peter Fillat Architects, Inc.                        $198,107
720 Aliceanna Street,
Suite 200
Baltimore, MD 21202
Tel: (410) 576-9310

Land Design, Inc.              Trade                 $71,369
200 South Peyton Street
Alexandria, VA 22314
Tel: (703) 549-7784
     (extension) 285

John A. Lally, Esquire         Professional services $60,000
14513 Main Street
Upper Marlboro, MD 20772
Tel: (301) 466-1668

Facchina-MCG                   Trade                 $25,000

Gally Public Affairs           Consulting & lobbying $18,182

Trend, Inc.                                          $15,000

RCLCO                                                $13,102

Robert Charles Lesser & Co.,                         $12,040
LLC

MuniCap, Inc.                                        $9,348

Delta Telephone & Cabling,     Trade                 $5,005
Inc.


BFWEST LLC: Has $205 Million in Debt to Creditors
-------------------------------------------------
BFWest LLC owes at least $205 million to a group of creditors,
Dawn McCarty of Bloomberg News reports.

As reported in the Troubled Company Reporter on March 27, 2008,
BFWest is an affiliate of mezzanine lender Builder Financial
Corp.  BFWest's sister companies Builder Funding and BFSPE LLC
make the loans, while the Debtor keeps track of acquisition and
development loans.

BFWest owed Builder Funding $58.1 million of unsecured debt, and
BFSPE LLC $32.5 million.  BFWest also owed $114.9 million to
WestLB, which is secured by certain loans and mortgages.

Headquartered in Fort Lauderdale, Florida, BFWest, LLC --
http://www.builderfinancial.com/-- a privately held specialty   
finance company that facilitates the financing of residential real
estate transactions by providing mezzanine financing to builders.  
It holds a portfolio of acquisition, development and construction
loans.

The company filed for Chapter 11 protection on March 26, 2008
(Bankr. S.D. Fla. Case No.08-13528).  Eyal Berger, Esq., and
Michael D. Seese, Esq., at Kluger, Peretz, Kaplan & Berlin, PL,
represent the Debtor.  No Official Committee of Unsecured
Creditors has been appointed in this case to date.

When the Debtor filed for protection against its creditors, it
listed assets and debts between $100 million to $500 million.


BLOCKBUSTER INC: Extends $1.3BB Unsolicited Bid for Circuit City
----------------------------------------------------------------
Blockbuster Inc. on Monday publicly announced an offer to acquire
Circuit City Stores Inc. for at least $6 per share in cash, or
roughly $1.3 billion, subject to due diligence.

The offer was initially made in a letter sent to Circuit City
chairman and chief executive officer Philip Schoonover on Feb. 17,
2008, on behalf of the Blockbuster board of directors, who fully
supports the bid.

Blockbuster's $1.3 billion buyout bid for Circuit City started a
controversy on Wall Street as capitalists wonder how could two
financially mixed up companies merge.  Stocks of each corporation
plummeted in 2007, Merissa Marr and Gary McWilliams of Wall Street
Journal report.

The letter reiterated Blockbuster's interest in pursuing an
acquisition of Circuit City.  The company noted that the cash
necessary would be generated through the issuance of additional
Blockbuster equity, in a rights offering to its existing
shareholders.  The company also added that the borrowing capacity
of the combined business would provide the remaining cash
proceeds.

To date, however, Circuit City has failed to provide due diligence
necessary to allow Blockbuster to make a definitive proposal.

Blockbuster said it is making its proposal public because it
believes the shareholders of Circuit City must have the
opportunity to participate in determining the destiny of the
company.  In addition, as Blockbuster has other strategic
opportunities, its offer is conditioned upon timely commencement
of the due diligence process.

Blockbuster noted the combination of the two companies would
result in an $18 billion retail enterprise positioned to
capitalize on the growing convergence of media content and
electronic devices.  The transaction would allow both companies to
benefit from the revenue growth generated by their complementary
products, while the resulting synergies would substantially
improve consolidated financial performance, thereby increasing
shareholder value.

"Our proposal offers Circuit City a significant premium to its
existing stock price and creates a game-changing retail concept
with a sustainable competitive advantage," Jim Keyes, Blockbuster
chairman and chief executive officer, said.  "We believe the
combination will result in a compelling consumer proposition that
will drive significant revenue and margin enhancements well as
cost synergies."

"At Blockbuster, we have successfully deployed a series of
strategic initiatives designed to provide our customers with
convenient access to media content," Mr. Keyes continued.  "These
strategic initiatives have already improved our financial results.
Driven by strong performance in our domestic same-store revenues,
we expect first quarter 2008 adjusted EBITDA to be approximately
$110 million versus $23 million for the same period last year."

"Additionally, net income for the first quarter of this year
should be $30 million compared to a net loss of $49 million for
the first quarter of 2007," Mr. Keyes continued.  "These results
are a clear demonstration that our strategy is working.  We look
forward to engaging in further conversations with Circuit City and
reaching an agreement as soon as possible.

Circuit City is still assessing Blockbuster's proposal, WSJ said.  
Circuit City has also advised its stockholders not to take any
move, unless queries on the acquisition are answered.

According to WSJ, Blockbuster's extreme action to stay in business
is a sign that the DVD rental business is in the process of  
extinction.

WSJ says the bid has the "strong backing" of Blockbuster's biggest
shareholder, investor Carl Icahn, and the support of dissident
Circuit City shareholder Mark J. Wattles.  According to WSJ, Mr.
Wattles said he would support Blockbuster's bid and would press
for acceptance of any offer "north of $6 a share."  Mr. Wattles
also indicated Monday, WSJ relates, that he had spoken to Mr.
Icahn by phone and the billionaire investor confirmed he would
backstop the deal if needed.  Mr. Wattles has launched a proxy
battle for Circuit City, seeking to remove CEO Schoonover, WSJ
says.

                 About Circuit City Stores Inc.

Headquartered in Richmond, Virginia, Circuit City Stores Inc.
(NYSE: CC) -- http://www.circuitcity.com/-- is a specialty  
retailer of consumer electronics, home office products,
entertainment software and related services.  The company has two
segments: domestic and international.  

                   About Blockbuster Inc.

Based in Dallas, Texas, Blockbuster Inc. (NYSE: BBI,
BBI.B) -- http://www.blockbuster.com/-- is a leading global     
provider of in-home movie and game entertainment, with over 7,800
stores throughout the Americas, Europe, Asia and Australia.  
(Movie Gallery Bankruptcy News Issue No. 15; Bankruptcy Creditors'
Service Inc.; http://bankrupt.com/newsstand/or 215/945-7000)

At Jan. 6, 2008, the company's total debt, including capital lease
obligations was $757.8 million compared with $984.2 million in
Dec. 31, 2006.

                          *     *     *

As reported in the Troubled company Reporter on Dec. 28, 2007,
Fitch Ratings affirmed Blockbuster Inc.'s long-term Issuer
Default Rating at 'CCC' and the senior subordinated notes at
'CC/RR6'.  The rating outlook is stable.  The company had
approximately $991 million of debt outstanding as of
Sept. 30, 2007.


BROWN SHOE: Operating Challenges Prompts S&P's Negative Outlook
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on St.
Louis, Missouri-based Brown Shoe Co. Inc. to negative from stable.   
At the same time, S&P affirmed all other ratings on the company,
including the 'BB' corporate credit rating.
      
"The outlook revision reflects the operating challenges facing the
company given the generally weak economic conditions," said
Standard & Poor's credit analyst David Kuntz.  

S&P also expects sales and margins to be hurt by cost increases
from suppliers over the medium term, and a further deterioration
in credit metrics for 2008.


CANADIAN TRUSTS: Investors Want ABCP Plan Voting Deadline Moved
---------------------------------------------------------------
Certain Canadian companies affected by the Canadian asset-backed
commercial paper market want to postpone a scheduled April 25,
2008 voting date for the proposed ABCP restructuring plan proposed
by the Pan-Canadian Investors Committee for Third-Party Structured
ABCP, Bloomberg News reports.

The investors assert that they need to study the proposal
further.  Some of the investors noted that they only received 360
pages of the relevant documents, Doug Alexander at Bloomberg
relates.  

The Pan-Canadian Committee has "not given the other noteholders
enough time and information to properly respond to this filing,"
Peter Linder told Bloomberg.  Mr. Linder represents seven junior
oil and gas companies that hold more than CN$100 million of ABCP.  
He has declined to identify his clients.

Another consultant of certain ABCP holders, Colin Kilgour, said
"[a] request for an extension is reasonable and likely.  An extra
month or so to make sure everyone has the opportunity to review
and understand the situation is prudent," Bloomberg quotes.

                       Investor Meetings

The Pan-Canadian Investors Committee for Third-Party Structured
ABCP was scheduled to hold a national teleconference for
noteholders yesterday.  The conference call was to provide an
opportunity for noteholders to ask questions about the Committee's
proposed plan to restructure 20 of the trusts covered by last
summer's Montreal Accord, affecting $32-billion of notes.  It also
afforded an opportunity for noteholders who were unable to attend
those meetings in person to learn more about the plan.

The first round of investor meetings called for by the Pan-
Canadian Committee was held March 31, 2008, in Toronto and
Montreal.  Similar meetings were held in Edmonton, Calgary, and
Vancouver on April 1.

Several retail ABCP holders attended the April 1 meeting, wherein
the attendees expressed their confusion about the proposed ABCP
restructuring.  All the investors want is a sure way to recoup
their investments, reports say.

Purdy Crawford, chair of the Committee, reiterated in the April 1
meetings that the Committee considers the retail investors a high
priority, and that their complaints about the complexity of the
proposed ABCP restructuring plan is understood,
edmontonjournal.com relates.

                      About the ABCP Trusts

Apollo Trust, Apsley Trust, Aria Trust, Aurora Trust, Comet Trust,
Devonshire Trust, Encore Trust, Gemini Trust, Ironstone
Trust, MMAI-1 Trust, Newshore Canadian Trust, Opus Trust, Planet
Trust, Rocket Trust, Selkirk Funding Trust, Silverstone Trust,
Slate Trust, Structured Asset Trust, Structured Investment Trust
III, Symphony Trust, Whitehall Trust are entities based in Canada
that issue securities called third-party structured finance asset-
backed commercial paper.  As of September 14, 2007, these 21
Canadian Trusts had approximately $33 billion of outstanding ABCP.

As reported by the Troubled Company Reporter on March 18, 2008,
Justice Colin Campbell of the Ontario Superior Court of Justice
granted an application filed on March 17 by The Pan-Canadian
Investors Committee for Third-Party Structured ABCP under the
provisions of the Companies' Creditors Arrangement Act.  The
Committee asked the Court to call a meeting of ABCP noteholders to
vote on a plan to restructure 20 trusts affecting $32 billion of
notes.  The trusts were covered by the Montreal Accord, an
agreement entered by international banks and institutional
investors on Aug. 16, 2007 to work out a solution for the ABCP
crisis in Canada.  Justice Campbell appointed Ernst & Young, Inc.,
as the Applicants' monitor, on March 17, 2008.  

(Canadian ABCP Trusts Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CANADIAN TRUSTS: CIBC to Provide Funding for Canadian ABCP Rescue
-----------------------------------------------------------------
Canadian Imperial Bank of Commerce is set to contribute funding
to five other big banks for the Pan-Canadian Committee for Third-
Party Structured ABCP's rescue plan to revive the Canadian ABCP
market, according to Reuters.  

Specifically, the Pan-Canadian Committee has entered into an
agreement with CIBC on certain default swaps related to two ABCP
Trusts.  Under the Agreement, CIBC will put up CN$300 million to
a CN$14 billion margin funding facility designed as a reserve, if
the ABCP investments ends up in another crisis in the future.

CIBC is Canada's fifth largest bank.

               Pan-Canadian Committee's Statement

On April 8, 2008, the Pan-Canadian Committee for Third-Party
Structured ABCP announced that satellite trusts of Structured
Asset Trust Series E and Structured Investment Trust III Series E
have reached an agreement with CIBC concerning the termination of
one of CIBC's credit default swaps -- related to SAT Series E --
and the inclusion of CIBC's two other credit default swaps --
related to SAT Series E and SIT III Series E -- as part of the
Committee's CCAA restructuring plan.

Reaching a mutually satisfactory agreement on the three swaps was
a condition of CIBC's participation in the margin funding
facility, which is integral to the Committee's restructuring plan.  
The agreement resulted from negotiations that began several months
ago among CIBC and investors who own a substantial majority of the
outstanding SAT Series E notes.

As part of the agreement, a credit default swap transaction with
Nemertes Credit Linked Certificate Trust (Commerce - LSS II)
Series 2006, which is a satellite trust of SAT, has been
terminated.  The termination resulted in a loss to noteholders of
SAT Series E of approximately $163 million, or approximately 23%
of principal.  The maximum recovery of funds for SAT Series E
investors as a result of this unwinding is now approximately 77%.

"We are pleased to see the successful restructuring of these
swaps," said Purdy Crawford, Chair of the Committee.  "This
restructuring is a long and complicated road comprising many
steps, and today's announcement represents further progress
towards successful implementation of the overall restructuring
plan."

CIBC is one of the financial institutions working with the
Committee to resolve liquidity issues attached to the ABCP market
in Canada and, together with a number of other Canadian Schedule I
banks, has agreed, subject to certain conditions, to participate
as a lender in the margin funding facilities that are proposed to
be put in place upon implementation of the restructuring plan.

The Committee held a series of roundtable meetings with investors
across the country the past week to talk about its restructuring
Plan, details of which are available on Ernst & Young Inc.'s Web
site, http://www.ey.com/ca/commercialpaper

Under provisions of the Companies' Creditors Arrangement Act, the
Plan must be approved by a majority of noteholders (regardless of
the size of their holdings) that vote at the meeting, as well as
by noteholders representing not less than 66-2/3% of the total
aggregate principal amount of affected ABCP that vote at the
meeting.  If the Plan is approved by the noteholders at the
meeting, a further hearing will be held before the Court for its
final sanction of the Plan.

       National Bank of Canada Joins in the Rescue Effort

The Financial Post reports that National Bank of Canada has agreed
to offer improved credit facilities to roughly 100 corporate and
commercial clients affected by the Canadian ABCP crisis, until the
notes of those clients mature.

National Bank of Canada is Canada's sixth largest bank.

                      About the ABCP Trusts

Apollo Trust, Apsley Trust, Aria Trust, Aurora Trust, Comet Trust,
Devonshire Trust, Encore Trust, Gemini Trust, Ironstone
Trust, MMAI-1 Trust, Newshore Canadian Trust, Opus Trust, Planet
Trust, Rocket Trust, Selkirk Funding Trust, Silverstone Trust,
Slate Trust, Structured Asset Trust, Structured Investment Trust
III, Symphony Trust, Whitehall Trust are entities based in Canada
that issue securities called third-party structured finance asset-
backed commercial paper.  As of September 14, 2007, these 21
Canadian Trusts had approximately $33 billion of outstanding ABCP.

As reported by the Troubled Company Reporter on March 18, 2008,
Justice Colin Campbell of the Ontario Superior Court of Justice
granted an application filed on March 17 by The Pan-Canadian
Investors Committee for Third-Party Structured ABCP under the
provisions of the Companies' Creditors Arrangement Act.  The
Committee asked the Court to call a meeting of ABCP noteholders to
vote on a plan to restructure 20 trusts affecting $32 billion of
notes.  The trusts were covered by the Montreal Accord, an
agreement entered by international banks and institutional
investors on Aug. 16, 2007 to work out a solution for the ABCP
crisis in Canada.  Justice Campbell appointed Ernst & Young, Inc.,
as the Applicants' monitor, on March 17, 2008.  

(Canadian ABCP Trusts Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CANADIAN TRUSTS: Canaccord to Redeem 97% of Clients' ABCP Stake
---------------------------------------------------------------
Canaccord Capital Inc. unveiled on April 9, 2008, details of the
Canaccord Relief Program to repurchase, at par value, up to CN$138
million of restructured third-party Asset Backed Commercial Paper
(ABCP) from clients who hold CN$1 million or less.

"After many months of negotiating on behalf of our clients,
Canaccord is pleased to offer a solution that provides them with
par value on their ABCP investment.  Clients will remain entitled
to receive any unpaid interest to the extent it is payable
pursuant to the restructuring plan and Canaccord will reimburse
the share of the overall restructuring costs borne by our
eligible clients," said Mark Maybank, chief operating officer of
Canaccord Capital Inc.  "We worked hard to secure this deal and
have contributed our capital to it.  With a tangible
restructuring in place and a rally in global credit markets, we
have been able to source and evaluate numerous bids from parties
interested in purchasing the notes and choose the best outcome
for our clients."

The Canaccord Relief Program is dependent on a successful
restructuring of the third-party ABCP market, and combines a
market bid from third-party sources with a Canaccord-funded top-
up to achieve par value.  Clients will also receive any unpaid
interest to the extent that it is available under the
restructuring plan, and Canaccord will reimburse the eligible
clients' actual share of the restructuring costs.  Clients who
hold CN$1 million or less of ABCP in aggregate will be eligible
for this relief.  This includes up to 1,430 -- or 97% -- of
Canaccord's impacted clients.

All funds required for these repurchases will be deposited in
escrow as soon as possible.  Eligible clients who wish to
participate in the program will be required to execute
assignments of all the notes they will receive on the
implementation of the restructuring.  These assignments will only
be effective upon payment of the purchase price.  The closing
will be subject to a successful restructuring, and certain other
conditions required under the market bid for the restructured
notes.  The closing of this purchase will take place as soon as
possible following the closing of the restructuring, but not more
than 20 business days after the completion of the distribution of
restructured notes in accordance with the restructuring plan.  

The restructuring plan is currently scheduled to close at the end
of May 2008.  Canaccord expects to make a further announcement
confirming completion of the escrow, and will provide formal
documentation about the Canaccord Relief Program in the very near
term.

"We appreciate our clients' patience during this difficult time
and we regret that this process has taken so long to complete and
the hardship this has caused our clients.  We hope they will view
the Canaccord Relief Program as a successful outcome to this
unprecedented disruption in the Canadian capital markets," added
Paul Reynolds, president and chief executive officer of Canaccord
Capital Inc.  "Canaccord has a long history of commitment to its
clients, which we believe we've demonstrated throughout this
challenging process.  With these efforts behind us, we look
forward to continuing to live up to our values and grow our
business as a leading global investment dealer."

More information about the Canaccord Relief Program is available
to clients at http://www.canaccordrelief.com/

Early this month, Canaccord disclosed a one-time after-tax charge
of approximately CN$39.6 million or $0.82 per share, related to
the Canaccord Relief Program for clients holding third-party Asset
Backed Commercial Paper.  The charge also includes a provision for
management restructuring and other costs, the company said in a
press release.

"This is a significant charge to our earnings that reflects our
commitment to resolving a very difficult process in the best
possible way for our clients," said Mr. Reynolds said.  "We remain
well capitalized and committed to our clients, which we believe
we've demonstrated throughout this process.  With these efforts
behind us, we look forward to continuing to live up to our values
and grow our business as a leading global investment dealer."

Through its principal subsidiaries, Canaccord Capital Inc. (TSX &
AIM: CCI) is a leading independent, full service investment
dealer in Canada with capital markets operations in the United
Kingdom and the United States of America.  Canaccord is publicly
traded on both the Toronto Stock Exchange and AIM, a market
operated by the London Stock Exchange.  Canaccord has operations
in two of the principal segments of the securities industry:
private client services and capital markets.  Together, these
operations offer a wide range of complementary investment
products, brokerage services and investment banking services to
Canaccord's private, institutional and corporate clients.

Canaccord has approximately 1,676 employees worldwide in 30
offices, including 23 Private Client Services offices located
across Canada.  Canaccord Adams, the international capital
markets division, has operations in Toronto, London, Boston,
Vancouver, New York, Calgary, Montreal, San Francisco, Houston
and Barbados.

        Pan-Canadian Committee Welcomes Canaccord's Offer

The Pan-Canadian Investors Committee for Third-Party Structured
ABCP welcomed Canaccord's offer to acquire all the restructured
third-party ABCP of its clients who hold CN$1 million or less of
the affected ABCP, if the Committee's proposed restructuring plan
is accepted by noteholders and the Court.

The Committee understands that the Canaccord proposal consists of
an offer to repurchase all of the restructured ABCP of those
clients at par, plus an amount designed to reimburse their share
of the overall restructuring costs allocated to these notes.  In
addition, Canaccord's clients will remain entitled to receive any
amounts payable on account of accrued interest during the
restructuring period pursuant to the Committee's plan.

"We believe this is an important step in resolving the concerns
of smaller noteholders," says Committee chairman Purdy Crawford
in a press release.  "We have consistently expressed our empathy
for the plight of these noteholders, many of whom we recognize
face dire circumstances."

The Chairman added that: "The Committee encourages other
financial intermediaries who may have sold affected ABCP to small
investors to follow Canaccord's initiative and address the
concerns of their smaller clients by providing liquidity
solutions such as this one.  The Committee is delighted that the
restructured notes available under the Committee's plan have
provided a basis for renewed liquidity options such as this."

On March 17th, the Ontario Superior Court of Justice granted an
application by the Committee, under the provisions of the
Companies' Creditors Arrangement Act (CCAA), to establish a
procedure for noteholder approval of the restructuring plan filed
by the Committee.  The plan must now be approved by noteholders
at a meeting in Toronto on April 25th and sanctioned by the
Court.

A copy of the plan, together with the related Information
Statement and other documents, has been mailed to all registered
and beneficial noteholders, and is available on the public Web
site of Ernst & Young Inc., the Court-appointed monitor in the
ABCP restructuring (www.ey.com/ca/commercialpaper)

                  Juroviesky Reserves Position on
               Canaccord's Conditional Partial Offer

Juroviesky and Ricci LLP noted in a press statement that it was
pleased to read of Canaccord Capital Inc.'s proposal to
conditionally purchase a portion of the Frozen ABCP it sold to
some of its clients.  "While we welcome any offer that may
relieve the burden currently being experienced by our Retail
Clients, CCI's proposal indicates that the Offer is subject to
certain conditions that have not been publicly disclosed, and are
not currently known by Juroviesky and Ricci LLP.  Accordingly,
Juroviesky and Ricci LLP currently reserves on whether or not it
supports the offer, subject to obtaining further information
regarding the conditions relating to the Offer," said Juroviesky.

"We also represent the interests of clients that purchased their
ABCP from sources outside Canaccord, and that accordingly, may
not be able to participate in the Offer," Juroviesky said.  
"Juroviesky and Ricci LLP wants to stress that at this time we
are still pursuing an offer to be made to all of our clients that
purchased their ABCP from all sources that will relieve ALL our
clients' frozen ABCP immediately at full value," said Juroviesky.

"We accordingly urge our clients to not take any un-informed
action until further direction from us, and we have had the
opportunity to analyze all the details relating to the Canaccord
Proposal," Juroviesky stated.  "Further information and direction
will be forthcoming from our offices, when we have additional
material information."

          ABCP Investors Still Wary of Canaccord Proposal

According to The Canadian Press, the Canaccord Relief Program was
disclosed a day before the House of Commons finance committee in
Ottawa, Canada, was to give six ABCP retail holders an
opportunity to air their ABCP-related concerns.

Retail ABCP investors, who hold about CN$350 million worth of
non-bank ABCP, are still not satisfied with the Relief Program
which Canaccord has put forward.  

Reuters reports that Diane Urquhart, a financial analyst
representing the retail ABCP holders, asserted at an April 10
House of Commons special meeting that the Canaccord Proposal is
not sufficient.  "This problem has not been resolved yesterday
despite the positive press coverage.  The offer is incomplete.
Only some families are being paid, numerous families have been
left out," Reuters quotes Ms. Urquhart.

Retail ABCP Investors have hinted at the April 10 parliamentary
hearing that they might take legal action with respect to the
ABCP they hold, Reuters says.  

"It is my belief that the ABCP was sold in the Canadian market
unlawfully and that it should have been sold with prospectus,"
Ms. Urquhart added, Reuters notes.

While the Canaccord Proposal seeks to repurchase 97% of its
impacted clients, it excludes 43 clients that hold more than
CN$1 million worth of ABCP.  These clients are composed of 28
corporate holders and 15 individual investors, which include New
Gold Inc., Redcorp Ventures Ltd. and Universal Uranium Ltd.  
According to Globe and Mail, the corporate investors intend to
ask Mr. Justice Colin Campbell of the Superior Court of Ontario
to allow them a veto in the ABCP restructuring process.

The Program is "inquitable and arbitrary," Norsemont Mining, Inc.
Chief Executive Patrick Evans also told The Canadian Press.  He
believes the Relief Program was set up to gain enough votes for
the Pan-Canadian Committee Restructuring Plan, which is scheduled
to be voted on April 25.  Norsemont Mining holds CN$7 million in
ABCP.  

Universal Uranium Ltd. Executive Vice President Bill Galine
agrees with Mr. Evans.  "How can you take care of just 97% of
your people?" The Canadian Press quotes Mr. Galine.  Universal
Uranium holds CN$1,400,000 in ABCP.

The Canadian Press noted that several attendees of the
parliamentary meeting complained that certain Canadian regulatory
bodies like the Ontario Securities Commission and the Office of
the Superintendent of Financial Institutions, failed to closely
monitor the ABCP market when illegal practices were being carried
out.  "The current financial regulatory system is broken and
offers no protection to Canadian investors," Ms. Urquhart avers,
according to The Canadian Press.

           Credential Securities Working on Relief Plan

Credential Securities, Inc., a brokerage firm based in Vancouver,  
has clients who hold roughly CN$48 million in ABCP investments.  
Credential Senior Vice President Elaine McHarg said in an
interview with Bloomberg News that her firm is currently
negotiating a relief plan for its clients.

"We are looking at a whole range of possibilities," Ms. McHarg
told Bloomberg.  "We would not be looking at buying it back
without appropriate partnerships."

"This proposal would be separate from Canaccord, but we are well
informed by the Canaccord proposal," Ms. McHarg added.

No details of the plan has been reported as of press time.

Credential averred that it has sold debt to about 335 retail ABCP
customers.

                      About the ABCP Trusts

Apollo Trust, Apsley Trust, Aria Trust, Aurora Trust, Comet Trust,
Devonshire Trust, Encore Trust, Gemini Trust, Ironstone
Trust, MMAI-1 Trust, Newshore Canadian Trust, Opus Trust, Planet
Trust, Rocket Trust, Selkirk Funding Trust, Silverstone Trust,
Slate Trust, Structured Asset Trust, Structured Investment Trust
III, Symphony Trust, Whitehall Trust are entities based in Canada
that issue securities called third-party structured finance asset-
backed commercial paper.  As of September 14, 2007, these 21
Canadian Trusts had approximately $33 billion of outstanding ABCP.

As reported by the Troubled Company Reporter on March 18, 2008,
Justice Colin Campbell of the Ontario Superior Court of Justice
granted an application filed on March 17 by The Pan-Canadian
Investors Committee for Third-Party Structured ABCP under the
provisions of the Companies' Creditors Arrangement Act.  The
Committee asked the Court to call a meeting of ABCP noteholders to
vote on a plan to restructure 20 trusts affecting $32 billion of
notes.  The trusts were covered by the Montreal Accord, an
agreement entered by international banks and institutional
investors on Aug. 16, 2007 to work out a solution for the ABCP
crisis in Canada.  Justice Campbell appointed Ernst & Young, Inc.,
as the Applicants' monitor, on March 17, 2008.  

(Canadian ABCP Trusts Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


C-BASS: Poor Collateral Performance Cues Moody's to Cut Ratings
---------------------------------------------------------------
Moody's Investors Service has downgraded 6 certificates from
C-BASS Series 2007-SL1 Trust.  The transaction is backed by second
lien loans.  The certificates were downgraded because the bonds'
credit enhancement levels, including excess spread and
subordination were low compared to the current projected loss
numbers at the previous rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second
collateral.  Substantial pool losses of over the last few months
have eroded credit enhancement available to the mezzanine and
senior certificates.  Despite the large amount of write-offs due
to losses, delinquency pipelines have remained high as borrowers
continue to default.

Complete rating actions are:

Issuer: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2007-SL1

  -- Cl. M-1, Downgraded to Caa2 from A2
  -- Cl. M-2, Downgraded to Caa3 from A3
  -- Cl. B-1, Downgraded to Ca from Ba1
  -- Cl. B-2, Downgraded to Ca from B2
  -- Cl. B-3, Downgraded to C from Caa1
  -- Cl. B-4, Downgraded to C from Ca


CALEDONIA MINING: Posts CN$4MM Net Loss in Year ended December 31
------------------------------------------------------------------
Caledonia Mining Corporation reported its fourth quarter and 2007
annual financial results.  

The company reported net income before discontinued operations of
CN$0.494 million compared to net income before discontinued
operations of CN$3.841 million for the same period in the previous
year.

For the year ended Dec. 31, 2007, Caledonia net loss after tax of
CN$3.9 million includes an unrealized loss on foreign exchange of
CN$1.012 million.  Cash available at year end totaled
CN$0.076 million from continuing operations.

"The extremely challenging economic environment in Zimbabwe caused
delays in completing the No 4 shaft expansion at our Blanket Gold
Mine, which in turn severely interfered with production and
ultimately impacted on the Group's financial performance, stated
Stefan Hayden, president and CEO.  "However the Nama Project
progressed well, which culminated in the recent signing of four
off-take agreements with large Chinese refiners."

"During the current quarter, I am pleased to disclose that we have
signed agreements for the sale of the Barbrook and Eersteling
companies for a total cash consideration of $12.91 million," added
Mr. Hayden.  "These transactions are expected to close during the
second and third quarter of this year respectively."

At Dec. 31, 2007, the company's balance sheet showed total assets
of CN$29.492 million, total liabilities of CN$5.397 million and
total shareholders' equity of CN$24.095 million.

                      About Caledonia Mining

Caledonia Mining Corporation (TSX: CAL) (OTC BB: CALVF) (AIM:
CMCL) -- www.caledoniaminin.com -- is a Canadian registered
mining, exploration and development corporation that owns a
diversified portfolio of carefully selected, high quality mines
and exploration properties in Southern Africa and Canada.

In June 2006 Caledonia acquired the Blanket Mine in Zimbabwe from
Kinross Gold Corporation of Toronto.  Caledonia's two South
African gold mines, Barbrook Mine and Eersteling Gold Mine, are
both currently on care-and-maintenance and were put up for sale in
December 2006.

                      Going Concern Doubt

On March 28 2008, BDO Dunwoody LLP's audit report of Caledonia
Mining Corp.'s consolidated financial statements for the years
ended Dec. 31, 2007, and 2006, is expressed in accordance with
Canadian reporting standards which do not require a reference in
the auditor's report to events and conditions which cast doubt on
the company's ability to continue as a going concern in the
auditors' report when these are adequately disclosed in the
financial statements.

The company's ability to continue as a going concern is dependent
upon attaining profitable operations, realizing proceeds from the
disposal of mineral properties and obtaining sufficient financing
to meet its liabilities, its obligations with respect to operating
expenditures and expenditures required on its mineral properties.


CHESAPEAKE CORP: Weak Performance Cues S&P to Chip Rating to 'B+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings for
Richmond, Virginia-based Chesapeake Corp., including the corporate
credit rating, which was lowered to 'B+' from 'BB-'.  At the same
time, S&P assigned a recovery rating of '6' to the company's
existing subordinated notes, indicating S&P's expectation for
negligible (0% to 10%) recovery in the event of a payment default.   
All ratings were removed from CreditWatch, where they were placed
with negative implications on Dec. 18, 2007.  The outlook is
negative.
      
"The downgrade reflects the company's weaker-than-expected
operating performance during 2007 due to lower results than
expected in certain segments, start-up production costs for a new
product line, and expenses for process-improvement initiatives,"
said Standard & Poor's credit analyst Andy Sookram.  "As a result,
credit metrics have weakened materially to a level no longer
consistent with the former ratings."
     
In addition, S&P expects that earnings may continue to be weak
over the next several quarters, which would pressure credit
measures and potentially tighten liquidity.
     
Chesapeake supplies specialty paperboard packaging (about 83% of
sales) and plastic packaging for pharmaceutical, health care,
spirits, confectionery, cosmetics, food, tobacco, household, and
chemical products.  The company is one of the largest virgin-
fiber-based folding carton producers in Europe.


CELSIA TECH: Modifies Debenture Interest Due Dates to May 2010
--------------------------------------------------------------
In connection with its previously issued 8% Secured Convertible
Debentures pursuant to a Securities Purchase Agreement dated as of
May 25, 2007, Celsia Technologies disclosed that on March 26,
2008, the company obtained consent from more than 70% of the
holders to modify the terms of Section 2 of the debentures to
provide that, in lieu of making the interest payments in cash or
in shares of common stock of the company on the interest payment
dates, such interest payments will accrue and be paid in full in
cash on May 25, 2010 .

In consideration for the holders' consent to the modification, the
company will distribute to the holders a one time distribution
equal to the value of 2% of the outstanding principal amount due
under the debentures as of March 31, 2008, which, in lieu of the
April 1, 2008 interest payment, will be paid in cash on the
maturity date.  

Each holder will have the right, in its sole discretion, to
convert any accrued but unpaid interest on the principal amount
due under the debentures into duly authorized, validly issued,
fully paid and non-assessable shares of common stock at the
applicable interest conversion rate at any time prior to the
maturity date.

                    About Celsia Technologies

Headquartered in Miami, Florida, Celsia Technologies Inc. (OTC BB:
CSAT) -- http://www.celsiatechnologies.com/-- is a full solution   
provider and licensor of thermal management products and
technology for the PC, consumer electronics, lighting and display
industries.  The company develops anc commercializes next-
generation cooling solutions built on patented micro
thermofluidic technology.  Celsia Technologies' intellectual
property portfolio includes patents registered in Korea, the U.S.,
Japan and Taiwan, with patents pending in the EU, Russia,
India and China.

At Dec. 31, 2007, the company's consolidated balance sheet showed
$6,124,404 in total assets and $6,348,495 in total liabilities,
resulting in a $224,091 total stockholders' deficit.

                     Going Concern Disclaimer

PKF, in New York, expressed substantial doubt about Celsia
Technologies 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 reported
that at Dec. 31, 2007, the company and its subsidiaries have
commenced limited revenue producing operations and have an
accumulated deficit of $40,292,494.


CITIUS II: Moody's Downgrades Ratings to C on $39 Million Notes
---------------------------------------------------------------
Moody's Investors Service has downgraded these notes issued by
Citius II Funding, Ltd.:

Class Description: $20,000,000 Class C Deferrable Floating Rate
Notes Due 2047

  -- Prior Rating: Caa2
  -- Current Rating: C

Class Description: $19,000,000 Class D Deferrable Floating Rate
Notes Due 2047

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

In addition Moody's also announced that it has downgraded and left
on review for possible downgrade these notes:

Class Description: Up to $1,800,000,000 Class A ST Notes Due 2047

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

Class Description: Up to $1,800,000,000 Class A LT Notes Due 2047

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

Class Description: $95,000,000 Class A Secured Floating Rate Notes
Due 2047

  -- Prior Rating: Baa1, on review for possible downgrade
  -- Current Rating: B1, on review for possible downgrade

Class Description: $50,000,000 Class B Secured Floating Rate Notes
Due 2047

  -- Prior Rating: Ba3, on review for possible downgrade
  -- Current Rating: B3, on review for possible downgrade

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


COBALT CMBS: Stable Performance Cues Fitch to Affirm Ratings
------------------------------------------------------------
Fitch Ratings has affirmed Cobalt CMBS Commercial Mortgage Trust,
series 2007-C2, commercial mortgage pass-through certificates as:

  -- $32.4 million class A-1 at 'AAA';
  -- $241.1 million class A-2 at 'AAA';
  -- $71.9 million class A-AB at 'AAA';
  -- $857.5 million class A-3 at 'AAA';
  -- $485.6 million class A-1A at 'AAA';
  -- $221.9 million class A-MFX at 'AAA';
  -- $102.6 million class A-JFX at 'AAA';
  -- $21.2 million class B at 'AA+';
  -- $27.2 million class C at 'AA';
  -- $21.2 million class D at 'AA-';
  -- $15.1 million class E at 'A+';
  -- $18.1 million class F at 'A';
  -- $20 million class A-MFL at 'AAA';
  -- $100 million class A-JFL at 'AAA';
  -- $30.2 million class G at 'A-';
  -- $24.2 million class H at 'BBB+';
  -- $24.2 million class J at 'BBB';
  -- $30.2 million class K at 'BBB-';
  -- $12.1 million class L at 'BB+';
  -- $3 million class M at 'BB';
  -- $9.1 million class N at 'BB-';
  -- $6 million class O at 'B+';
  -- $3 million class P at 'B';
  -- $6 million class Q at 'B-';
  -- Interest-only class X at 'AAA'.

Fitch does not rate the $30.2 million class S.

The affirmations are the result of stable pool performance.  There
have been no delinquent or specially serviced loans since
issuance.  As of the March 2008 distribution report the
transaction's principal balance has decreased slightly as
interest-only loans represent 53.4% of the pool.  Additionally,
37.6% of the pool presently has an interest-only period ranging
from one to 72 months.

Fitch reviewed the most recent operating statement analysis
reports and occupancy figures for the seven shadow rated loans in
the transaction: Peter Cooper Village and Stuyvesant Town (10.4%),
Ala Moana Portfolio (4.1%), Shadow Pines Apartments (0.5%), 3505-
3521 East Chapman Retail Center (0.3%), Pathmark Store (0.2%),
Highland Orchard Apartments (0.2%) and 201 Wilshire (0.1%).  Based
on their stable performance since issuance the loans maintain
their investment grade shadow ratings.

Peter Cooper Village and Stuyvesant Town (10.4%) 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 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.  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.  

As of Dec. 31, 2007, 33.7% of the units are market rate (66.3% are
stabilized) compared to approximately 27% at issuance
(approximately 73% were stabilized) and an additional 6.7% are
currently vacant and undergoing renovations to prepare for market
rate tenants.  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 reserve to cover debt service
shortfalls, conversion costs, capital expenditures, and operating
expenses during the term of the loan has a current balance of
$203.8 million.  The trust portion represents a $250 million pari
passu piece of the entire $3.0 billion A note.  There is an
additional $1.5 billion of mezzanine debt outside the trust.

Ala Moana Portfolio (4.1%) is collateralized by a two million
square foot mixed use retail and office property located in
Honolulu, Hawaii.  Retail anchors include Sears, Macy's and
Nordstrom's.  Major tenants include Shirokiya, Barnes & Noble,
Longs Drugs, Kaiser Foundation and Gap.  In-line tenants include
Tiffany, Cartier, Louis Vuitton, Chanel, Dior, Banana Republic,
Prada, Williams Sonoma, Apple and Disney.  The retail portion of
the collateral is occupied by nearly 275 tenants while the office
portion is occupied by 184 tenants.  The property benefits from
the experienced sponsorship and management of GGP LP, a real
estate investment trust which currently owns and manages a
portfolio of 200 regional malls totaling 200 million sf.  The pari
passu $100 million A-8 note of the $1.315 billion whole A note is
included in this transaction with the remainder of notes A-1
through A-7 securitized in various transactions.  The $1.5 billion
whole loan consists of notes A-1 through A-8 and notes B through
F.  Occupancy as of Dec. 31, 2007 has increased slightly to 97.1%
from 96.9% since issuance.


DELTA AIR: Deal with Pilots Clears Way for Northwest Merger
-----------------------------------------------------------
Delta Air Lines Inc. and its pilots have reached an agreement  
in principle on a contract that would purportedly clear the way
for the carrier's merger with Northwest Airlines Corp.,
Bloomberg News reports.

[The Wall Street Journal has reported that the board of directors
of both airline companies approved the merger.  A separate story
is included in today's Troubled Company Reporter.]

The accord would allegedly raise Delta pilots' pay and give them
an equity stake in the consolidated carrier, people familiar with
the talks said.

Any pact would need to be approved by the leaders of the Delta
pilots union, a unit of the Air Line Pilots Association, before
the carriers could finalize their deal, says The Atlanta Journal-
Constitution.  The Delta union's 6,000 members also may vote
later on whether to ratify a new labor contract tied to the
merger.

"With oil at $110 per barrel and the weakening economy, Delta
probably got to the point where they felt like they needed to
move ahead," said Michael Derchin, an analyst with FTN Midwest
Research Securities Corp. in New York.  "It always made
strategic, long-term sense for these companies."

The merger talks hit a snag in February when the airlines' pilots
weren't able to agree on a way to protect members' seniority
rankings after a consolidation.

Now, Delta wants to draw up a new contract with just its 7,000
pilots, and Northwest's 5,000 pilots would be asked to join under
a single contract later, said the people who didn't want to be
identified because the plan is still private.  The plan includes
a small premium for Northwest investors, the unidentified sources
said, reports Bloomberg.

"It's sort of a backhanded slap at the Northwest pilots," said
Douglas Marshall, director of the Aviation Graduate Program at
the University of North Dakota.  "Delta's pilots are going to
have more leverage.  They will be in a stronger position."

Negotiations to create a combined seniority list may take months
to complete, Bloomberg says, citing people familiar with the
situation.

"It is hard to anticipate Northwest pilots' level of interest in
agreeing to an unknown Delta seniority integration proposal,"
said Robert Mann of R.W. Mann & Co. in Port Washington, New York,
a consultant for airlines and unions.

Betsy Talton, spokeswoman for Delta, and Tammy Lee, a spokeswoman
for Northwest, declined to comment.

                     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 US$14.4 billion
in total assets and US$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 Airlines Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.

                          About Delta Air

Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners.  Delta flies to
Argentina, Australia and the United Kingdom, among others.

The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts.  Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice.  Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice.  John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors.

The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.  On
Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on
Feb. 2, 2007.  On Feb. 7, 2007, the Court approved the Debtors'
disclosure statement.  In April 25, 2007, the Court confirmed the
Debtors' plan.  That plan became effective on April 30, 2007.  The
Court entered a final decree closing 17 cases on Sept. 26, 2007.  
(Delta Air Lines Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 17, 2008,
Standard and Poor's said that media reports that Delta Air Lines
Inc. (B/Positive/--) entered into merger talks with UAL Corp.
(B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will
have no effect on the ratings or outlook on Delta, but that
confirmed merger negotiations would result in S&P's placing
ratings of Delta and other airlines involved on CreditWatch, most
likely with developing or negative implications.


DELTA AIR: Board Votes "For" Merger with Northwest Airlines
-----------------------------------------------------------
The board of directors of both Delta Air Lines Inc. and Northwest
Airlines Corp. gave their consent Monday to allow the two airlines
to merge based on an all-stock deal, The Wall Street Journal and
The Associated Press relate.

The combination of Delta and Northwest, which is still subject to
regulatory approval, stands to create the world's largest airline
operator in the world valued at $17.7 billion, AP says.

Under the merger, each Northwest shareholder will get 1.25 shares
in the combined company for every share owned, or equivalent to
17% premium as of Monday's trading, based on WSJ's and AP's
reports.

Both reports recount that Delta and Northwest have emerged from
bankruptcy in 2007 and "are in much better shape" as compared with
smaller airlines that have recently gone bankrupt.

The deal, reportedly, could incite potential workers' protest.

                   Air France-KLM Partnership

Reports note that Delta and Northwest have partnered with Air
France-KLM SA, which previously indicated plans to invest
$750.0 million in the merger of the two U.S. airlines.

As reported in the Troubled Company Reporter on Feb. 22, 2008,
amid the merger rumors, Franco-Dutch airline Air France-KLM
expressed its interest to invest in the entity that would emerge
from a Delta and Northwest merger.  Pierre-Henri Gourgeon, Air
France-KLM's deputy CEO said in an analysts' conference call that
the investment would depend on whether the U.S. airlines obtain a
green light from competition authorities and probably won't result
in any payments before the end of 2008.  The investment is said to
be close to $1.0 billion or EUR680.0 million.

                          Labor Issues

Concerning potential employee protest, the TCR said on April 10,
2008, that Northwest and Delta have revived their merger talks,
even without the pre-arranged deal from both carriers' pilots,
said people familiar with the situation.  Delta's board members
convened on April 4, 2008, and agreed to continue the talks which
were reportedly intensifying.  

Delta pilots were granted permits to picket at Northwest hubs
from April 8 to 24, to protest over the carriers' pilot-seniority
dispute.  Northwest's pilots union said it reserves the right to
do the same thing at Delta hubs if it chooses.

Previously, pilots' leaders from both carriers were unable to
reach an agreement on an acceptable seniority list integration.  
The original deal between the parties included a common pilot
labor contract for their combined 11,000 pilots that would give
all of them raises, with Northwest's 5,000 aviators getting
heftier increases to bring them up to Delta levels.  The new deal
may include a smaller pay package for pilots.

The carriers are not required by law to come up with pre-merger
pilots' labor agreements to push through with the deal.  Delta and
Northwest, however, wanted to avoid a messy, labor wrangle once
the deal was consummated and, therefore, made efforts to come up
with a "common labor contract."

A report about Delta reaching an agreement in principle with its
pilots that would purportedly clear the way for the carrier's
merger with Northwest is included in today's TCR issue.

               Expected Revenue Boost After Merger

Once approved by regulators, the merger will result in a projected
annual sales of $31.7 billion, significantly higher than American
Airlines Inc.'s annual sales, according to AP.

WSJ reports that the merger will realize annual revenue and cost
reduction will reach at least $1.0 billion.  WSJ adds that the
Delta and Northwest will need less than $1.0 billion to complete
the merger.

                Wave of U.S. Airline Consolidation

According to the reports, the merger signals the start of a series
of collaborative efforts among U.S. airlines to address the rise
in fuel costs, weakened economy, and the financial crisis.  Larger
airlines also have greater ability to compete internationally,
relate the reports.

The TCR related on March 24, 2008, that United Air Lines Inc.
would pursue a consolidation with Continental Airlines Inc. if
given the go-ahead, to create the airline industry's biggest
carrier.

Stephen Canale, a union representative on United Airlines' board
of directors, said that Continental is "without question" the
first choice for a United merger.

The TCR said that the merger between Delta and Northwest, which
was at that time currently under consideration, could incite a
United-Continental tie-up.

                     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 US$14.4 billion
in total assets and US$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 Airlines Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.

                         About Delta Air

Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners.  Delta flies to
Argentina, Australia and the United Kingdom, among others.

The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts.  Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice.  Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice.  John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors.

The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.  On
Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on
Feb. 2, 2007.  On Feb. 7, 2007, the Court approved the Debtors'
disclosure statement.  In April 25, 2007, the Court confirmed the
Debtors' plan.  That plan became effective on April 30, 2007.  The
Court entered a final decree closing 17 cases on Sept. 26, 2007.  
(Delta Air Lines Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 17, 2008,
Standard and Poor's said that media reports that Delta Air Lines
Inc. (B/Positive/--) entered into merger talks with UAL Corp.
(B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will
have no effect on the ratings or outlook on Delta, but that
confirmed merger negotiations would result in S&P's placing
ratings of Delta and other airlines involved on CreditWatch, most
likely with developing or negative implications.


DIRECT INSITE: December 31 Balance Sheet Upside-Down by $1 Million
------------------------------------------------------------------
Direct Insite Corp.'s balance sheet at Dec. 31, 2007, showed total
assets of $4.522 million and total liabilities of $5.567 million,
resulting to total shareholders' deficit of $1.045 million.

"Strong, consistent demand for our ASP Software as Service model
provides a solid base for continued growth in recurring revenues
and profitability," James A. Cannavino, chairman and CEOm, said.  
"Our growing reputation for delivering savings through improved
efficiency and increased customer satisfaction are fueling demand
for our services."  

For the year ended Dec. 31, 2007, the company reported net income
of $2.100 million compared to net income of $269,000 for the year
ended Dec. 31, 2006, an improvement of $1.831 million.  

Cash provided from operations for the year ended Dec. 31, 2007,
was $3.255 million compared to cash provided from operations of
$1.149 million for the year ended Dec. 31, 2006.  This improvement
is due to the increase in sales, continued control of operating  
costs and lower costs.

Cash  provided from operations for the year ended Dec. 31, 2007,
was $3.255 million, consisting of the net income of
$2.100 million, increased by non-cash expenses of $0.941 million,  
including depreciation and amortization on property and
equipment of $0.332 million, and stock based compensation expense
of $0.609 million.  

Cash from operations was further increased by a decrease in
accounts receivable, prepaid expenses and other current and non-
current assets of $520,000, an increase in accounts payable and  
accrued expenses of $0.135 million, offset by a decrease in
deferred revenue of $0.441 million.
     
Cash used in investing activities was $0.202 million for the year
ended Dec. 31, 2007, compared to $0.097 million for the previous  
year.  This was expenditures for equipment in 2007 and 2006.

Cash used in financing activities totaled $1.164 million for the
year ended Dec. 31, 2007, compared to cash used in financing  
activities of $1.121 million in 2006.  The company has repaid
Lines of Credit  totaling $0.586 million during 2007.

In addition, advances from credit lines for receivable financing  
decreased $0.481 million for the year ended Dec. 31, 2007 and the
company made repayments on capital leases and capital notes of
$0.125 million.  The company received proceeds on exercise of
stock options of $0.028 million.

As a result of these operating, investing and financing
activities, cash increased by $1.889 million to $2.184 million at
Dec. 31, 2007.

At Dec. 31, 2007, the company has accrued dividends due to holders
of its preferred stock of $3.336 million.  In January 2008, the
company paid $0.773 million of dividends to the holders of the
Series B Preferred Stock.

                     About Direct Insite

Headquartered in Bohemia, New York, Direct Insite Corp.
(OTC BB: DIRI.OB) -- http://www.directinsite.com/-- provides
financial supply chain automation across Procure-to-Pay and Order-
to-Cash processing.  The company's global eInvoice Management
services automate complex manual business processes such as
invoice validation, order matching, consolidation, dispute
handling, and e-payment processing.  Direct Insite solutions are
used by more than 7,000 corporations across 62 countries, 15
languages and multiple currencies.


EDM EQUIPMENT: Files Chapter 7 Liquidation in Nebraska
------------------------------------------------------
EDM Equipment Co. sought protection from creditors under chapter 7
of the Bankruptcy Code before the U.S Bankruptcy Court for the
District of Nebraska, The Associated Press relates.

A state court judge awarded creditor TierOne to put the company
under temporary receivership until the court decides on the
distribution of the Debtor's assets, AP says.  The Debtor's
bankruptcy filing placed on hold the temporary receivership, based
on AP's report.  TierOne has claims of about $3 million, according
to the report.

AP recounts that a week ago, Laurie Rathman, former EDM office
manager, was sentenced to six months imprisonment and probation
for embezzlement of $150,000 from the company.  According to the
report, EDM president Jeffrey Mellon informed law officers that
Mr. Rathman took $200,000 since 2002, based on court filings.

Court documents do not show asset and debt information, AP
relates.  Details on the bankruptcy filing will be released in two
weeks, AP adds.

Lincoln, Nebraska-headquartered EDM Equipment Co. --
http://www.edmequipment.com/-- is a local distributor of seven  
firetrucks a Florida manufacturer built for Lincoln.  It supplies
fire and rescue and environmental products and equipment.  It
serves Nebraska, Iowa, Colorado, Kansas and Missouri.


EDUCATION RESOURCES: Asks Court to Clarify Creditors' Info Access
-----------------------------------------------------------------
The Education Resources Institute Inc. asks the U.S. Bankruptcy
Court for the District of Massachusetts to confirm that any
committee of creditors appointed under Section 1102(a) of the
Bankruptcy Code in the Debtor's Chapter 11 cases is not authorized
or required, pursuant to Section 1102(b)(3)(A), to provide access
to TERI's confidential, privileged or otherwise non-public
proprietary information to the creditors it represents.

Congress enacted the new Section 1102(b)(3) as part of the
Bankruptcy Abuse Prevention & Consumer Protection Act of 2005.  
The Section states, in relevant part, that a creditors' committee
appointed under Section 1102(a) will "provide access to
information for creditors who (i) hold claims of the kind
represented by that committee; and (ii) are not appointed to the
committee."

Section 1102(b)(3)(A), however, does not indicate how a
creditors' committee should provide "access to information" and,
more importantly, does not indicate the nature, scope, or extent
of the "information" that a committee must provide to the
creditors that it represents, the Debtor's counsel, Daniel M.
Glosband, Esq., at Goodwin Procter LLP, in Boston, Massachusetts,
notes.

Moreover, there appears to be no legislative history to Section
1102(b)(3) that might provide guidance on the application of the
new provision, Mr. Glosband further notes.  He tells the Court
that the lack of specificity in Section 1102(b)(3)(A) creates
significant issues for debtors and creditors' committees -- it
raises the issue of whether a creditors' committee could be
required to share a debtors' Confidential Information with any
creditor that the committee represents; and with any creditor
that the committee represents information subject to the
attorney-client or some other state, federal, or other
jurisdictional law privilege, whether that privilege is solely
controlled by the committee or is a joint privilege with the
debtor or some other party.

According to Mr. Glosband, a creditors' committee appointed in
its Chapter 11 case would be permitted, but not required, to
provide access to Privileged Information to any party so long as
(i) that Privileged Information was not Confidential Information,
and (ii) the relevant privilege was held and controlled solely by
the Creditors' Committee.

The Debtor operates in a highly competitive and, under current
market conditions, a highly distressed space, Mr. Glosband
contends.  Because the Debtor is still formulating its business
plan, the dissemination of its Confidential Information to
parties who are not bound to any confidentiality agreement with
TERI could be disastrous for the Debtor and its creditors, he
says.  The public dissemination of the Debtor's Confidential
Information likely would cause serious harm to the Debtor's
estate, he asserts.

If there were a risk that Confidential Information given by the
Debtor to the creditors' committee would have to be turned over
to any creditor, TERI would be highly discouraged from giving
Confidential Information to the committee at all.  The inability
of the committee to gain access to Confidential Information, in
turn, could limit the ability of the committee to fulfill its
statutory obligations under the Bankruptcy Code, Mr. Glosband
adds.

Indeed, unless it is made clear that the risk of dissemination of
Privileged Information does not exist, the estate representation
structure envisioned by the Bankruptcy Code would become
immediately dysfunctional, Mr. Glosband states.

                            Procedures

The Debtor proposes that the creditors' committee and its
individual members and its representatives, advisors, and counsel
be deemed to be in compliance with Sections 1102(b)(3) and
1103(c) by implementing certain procedures, which may include:

   (a) authorizing, but not requiring, establishment of a Web
       site to make certain information available to creditors;

   (b) making available on the Web site information regarding the
       Debtor's Chapter 11 case that the Creditors' Committee or
       its counsel, in its sole discretion, deems appropriate
       subject to certain restrictions and limitations;

   (c) establishing an e-mail address to allow unsecured
       creditors to send questions and comments in connection
       with TERI's Chapter 11 case; and

   (d) authorizing the Creditors' Committee and its counsel, in
       its reasonable discretion, to review or respond to the e-
       mail correspondence.

Headquartered in Boston, Massachussetts, The Education Resources
Institute Inc. -- http://www.teri.org/-- aka Boston Systems   
Resources Inc., Brockton Education Opportunity Center, TERI, TERI
College Access, TERI College Access Centers and TERI Marketing
Services Inc., is a nonprofit organization that promotes
educational opportunities for all through its college access and
loan guarantee activities.  Founded in 1985, TERI is a guarantor
of private or non-government student loans with more than $17
billion in outstanding guarantees.  

The Debtor filed for Chapter 11 petition on April 7, 2008 (Bankr.
D. Mass. Case No.: 08-12540.)  Daniel Glosband, Esq., Gina L.
Martin, Esq. at Goodwin Procter LLP represent the Debtor in its
restructuring efforts.  The Debtor's Conflicts Counsel is Craig
and Macauley PC, its financial advisor is Grant Thornton LLP, its
Claims Agent is Epiq Bankruptcy Solutions LLC, its investment
Banker is Citigroup Global Markets Inc., and its Public Relations
& Public Affairs Advisor is Rasky Baerlein Strategic
Communications Inc.  When the Debtor filed for protection from its
creditors, it listed estimated assets of more that $1 billion and
estimated debts of $500,000 to $1 billion.

(TERI Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)  


EDUCATION RESOURCES: Wants to Hire EPIQ Bankruptcy as Claims Agent
------------------------------------------------------------------
The Education Resources Institute, Inc., seeks authority from the
U.S. Bankruptcy Court for the District of Massachusetts to employ
EPIQ Bankruptcy Solutions LLC, as its claims, noticing and
balloting agent.

The Debtor relates that the EPIQ is well-suited to perform the
the task of a notice agent.  EPIQ is a claims management and case
administration firm with more than 17 years of in-depth
experience in performing noticing, claims processing, claims
reconciliation and other administrative tasks for Chapter 11
debtors.  EPIQ is also experienced in performing plan voting and
distribution services, and other services relating to its role as
a claims and noticing agent.

As claims agent to the Debtor, EPIQ is expected to assist the
Debtor with the preparation and distribution of all required
notices in its Chapter 11 Case including:

   (a) a notice of the commencement of the Chapter 11 case
       and any initial meeting of creditors under Section
       341(a) of the Bankruptcy Code;

   (b) notice of claims bar dates;
  
   (c) notice of objections to claims;

   (d) notices of any hearings on the Debtor's disclosure
       statement and confirmation of the Debtor's Chapter 11
       plan; and

   (e) other miscellaneous notices as the Debtor or the Court
       may deem necessary or appropriate for the orderly
       administration of the Chapter 11 case;

   (f) filing with the Court Clerk's Office a certificate or
       affidavit of service, promptly after the service of a
       particular notice, that includes (i) a copy of the notice
       served; (ii) a list of persons upon whom the notice was
       served, along with their addresses; and (iii) the date and
       manner of service;

   (g) receiving, examining and maintaining copies of all proofs
       of claim and proofs of interest filed in the Chapter 11
       case;
                 
   (h) maintaining an official registers in the Debtor's Chapter
       11 case by docketing all proofs of claim and proofs of
       interest in the applicable claims database that
       includes pertinent information for each claim or interest
       asserted, including:

          -- the name and address of the claimant or interest
             holder and its agent, if the proof of claim or
             proof of interest was filed by an agent;

          -- the date the proof of claim or proof of interest was
             received by EPIQ or the Court;

          -- the claim number assigned to the proof of claim or
             proof of interest; and

          -- the asserted amount and classification of the claim,

   (i) implementing necessary security measures to ensure
       the completeness and integrity of the claims registers;

   (j) transmitting to the Court Clerk's Office a copy of the
       claims registers on a weekly basis, unless requested by
       the Clerk's Office on a more or less frequent basis;

   (k) maintaining an up-to-date mailing list for all entities
       that have filed proofs of claim or proofs of interest and
       make the list available upon request to the Clerk's Office
       or any party in interest;

   (l) providing access to the public for examination of copies
       of the proofs of claim or proofs of interest filed in the
       Chapter 11 case without charge during regular business
       hours;

   (m) recording all transfers of claims pursuant to Rule 3001(e)
       of the Federal Rules of Bankruptcy Procedure and providing
       notice of the transfers as required by Rule 3001(e);

   (n) complying with applicable federal, state, municipal and
       local statutes, ordinances, rules, regulations, orders
       and other requirements;

   (o) complying promptly with further conditions and
       requirements as the Clerk's Office or the Court may at any
       time prescribe;

   (p) providing other claims processing, noticing, disbursing
       and related administrative services as may be
       requested from time to time by the Debtor, including,
       assisting in preparation of the Debtor's schedules and
       statements of financial affairs, if necessary;

   (q) overseeing the distribution of the applicable solicitation
       materials to each holder of a claim against or interest in
       the Debtor if any post-petition distributions are
       necessary;

   (r) responding to mechanical and technical distribution and
       solicitation inquiries, on a postpetition basis;
                
   (s) receiving, reviewing and tabulating the ballots cast, and
       making determinations with respect to each ballot as to
       its timeliness, compliance with the Bankruptcy Code,
       Bankruptcy Rules and procedures ordered by the Court
       subject; and

   (t) performing other related plan-solicitation services as may
       be requested by the Debtor.

In addition, EPIQ, as notice agent, will assist the Debtor with,
among other things, certain data processing and ministerial
administrative functions, including:

   * preparing schedules, statements of financial affairs, if
     necessary, and preparing the master creditor list, and any
     amendments; and

   * acting as solicitation and disbursing agent in connection
     with the chapter 11 plan process.

The Debtor will pay EPIQ according to its customary hourly rates:
                                       
    Professional                        Hourly Rate
    ------------                        -----------   
    Clerk                                $40 -  $60
    Case Manager (Level 1)              $125 - $175
    IT Programming Consultant           $140 - $190
    Case Manager (Level 2)              $185 - $220
    Senior Case Manager                 $225 - $275
    Senior Consultant                      $295

Mr. Glosband discloses that on April 1, 2008, EPIQ received a
$25,000, retainer from the Debtor.

James Katchadurian, senior vice president of EPIQ, assures the
Court that his firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code, and does not
hold or represent any interest adverse to the Debtor's estates or
of any class of creditors or equity security holders.

           About The Education Resources Institute Inc.

Headquartered in Boston, Massachussetts, The Education Resources
Institute Inc. -- http://www.teri.org/-- aka Boston Systems   
Resources Inc., Brockton Education Opportunity Center, TERI, TERI
College Access, TERI College Access Centers and TERI Marketing
Services Inc., is a nonprofit organization that promotes
educational opportunities for all through its college access and
loan guarantee activities.  Founded in 1985, TERI is a guarantor
of private or non-government student loans with more than $17
billion in outstanding guarantees.  

The Debtor filed for Chapter 11 petition on April 7, 2008 (Bankr.
D. Mass. Case No.: 08-12540.)  Daniel Glosband, Esq., Gina L.
Martin, Esq. at Goodwin Procter LLP represent the Debtor in its
restructuring efforts.  The Debtor's Conflicts Counsel is Craig
and Macauley PC, its financial advisor is Grant Thornton LLP, its
Claims Agent is Epiq Bankruptcy Solutions LLC, its investment
Banker is Citigroup Global Markets Inc., and its Public Relations
& Public Affairs Advisor is Rasky Baerlein Strategic
Communications Inc.  When the Debtor filed for protection from its
creditors, it listed estimated assets of more that $1 billion and
estimated debts of $500,000 to $1 billion.

(TERI Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)  


EGPI FIRECREEK: To Restate Financial Statements Due to Errors
-------------------------------------------------------------
On March 25, 2008, management of EGPI Firecreek Inc. determined
that these financial statements of the company should not be
relied upon:

(1) the company's audited consolidated financial statements in
     the Annual Reports on Forms 10-KSB for the periods ending:
     Dec. 31, 2005 and 2006; and

(2) the company's unaudited consolidated financial statements in
     the Quarterly Reports on Forms 10-QSB for the periods ending:
     March 31, 2006, and 2007; June 30, 2006 and 2007; and
     Sept. 30, 2006, and 2007.

The company determined that its accounting for the convertible
debentures issued during the fourth quarter of 2005, and during
the years ended 2006 and 2007 were not in accordance with U.S.
generally accepted accounting principles.  Specifically, the
incentive debenture and the conversion features were not
bifurcated and classified as a derivative liability in the
consolidated balance sheets.  The corresponding debt discount
should be amortized to interest expense over the life of the host
convertible debenture.   

The company's consolidated balance sheets will be affected by a
substantial increase in total liabilities and total shareholders'
deficit as of Dec. 31, 2006, and a decrease in shareholders'
deficit as of Dec. 31, 2005, and an increase in total liabilities
as of Dec. 31, 2005.  Additionally, there will be a material
increase in net loss for the year ended Dec. 31, 2006, and a
material decrease in net loss for the year ended Dec. 31, 2005.  

                       About EGPI Firecreek

Based in Scottsdale, Arizona, EGPI Firecreek Inc. (OTC BB: EFCR)
-- http://egpifirecreek.net/-- is currently focused on oil and   
gas activities in the following areas: i) Development of its  
domestic interests acquired in Wyoming in late 2005 for production
of primarily natural gas, and Texas for production of oil, and ii)
to a lesser extent, pursuit of and potential completion of
projects overseas in Central Asian and European countries.

                          *     *     *

At Sept. 30, 2007, the company's consolidated balance sheet showed
$3,269,432 in total assets and $8,308,184 in total liabilities,
resulting in a $5,038,752 total stockholders' deficit.


FINANCIAL GUARANTY: Explores Options, Including Capital Infusion
----------------------------------------------------------------
FGIC Corporation the parent company of Financial Guaranty
Insurance company has begun discussions with potential investors
and other parties regarding strategic alternatives the company is
exploring that would enable FGIC to both enhance its capital
position and protect its policyholders.  The company is optimistic
that within the coming weeks it will have a course of action to
propose to its board of directors.  As previously reported, FGIC
has retained Goldman Sachs to assist in these efforts.

According to Bloomberg News, FGIC is considering in selling the
company.

FGIC said that the strategic alternatives it is exploring include
raising capital for a newly established triple-A guarantor
dedicated exclusively to the global public finance business.  This
company would also assume FGICs existing public finance and
international infrastructure business.

"With a high-quality and diversified portfolio, coupled with a
focused business strategy, the new company would have a unique
platform to deliver superior value to its clients and investors in
the securities it insures," a FGIC spokesman said.  "Other
alternatives include, but are not limited to, the sale of all or
part of the company, and a bulk reinsurance transaction on all or
parts of FGICs in-force business to a third party."

FGIC said it believes that its strategic alternatives are
consistent with the goals of the New York Insurance Department
with regard to the company and its policyholders.  The company
said it continues to work closely with Superintendent Dinallo and
the NYID as it progresses with its negotiations.

                    About Financial Guaranty

Financial Guaranty Insurance Co. -- http://www.fgic.com/-- has      
enjoyed a reputation for financial strength, underwriting
discipline and superior client service.  As a leading financial
guaranty insurance company, FGIC provides credit enhancement on
infrastructure finance and structured finance securities
worldwide, enabling bond issuers to obtain capital cost
effectively and enhancing their access to the capital markets.  
The firm is a primary insurer on the $850 million sewer bond debt
of Jefferson County.  

                          *     *     *

As reported by the Troubled company Reporter on April 1, 2008,
Moody's Investors Service downgraded to Baa3, from A3, the
insurance financial strength ratings of the operating subsidiaries
of FGIC Corporation, including Financial Guaranty Insurance
company and FGIC UK Limited.  The three notch downgrade of FGIC's
IFS ratings to Baa3 reflects Moody's view that the cushion above
the required regulatory minimum may not be sufficient to absorb
additional losses associated with FGIC's mortgage related
exposures and the recent deterioration of Jefferson County bonds,
to which FGIC has sizable exposure.  


FIRST FRANKLIN: Moody's Lowers Ratings on 16 Certificate Classes
----------------------------------------------------------------
Moody's Investors Service has downgraded 16 certificates and
maintained on review for possible further downgrade 3 of those
classes of certificates from 3 transactions issued by First
Franklin Mortgage Loan Trust.  The transactions are backed by
second lien loans.  The certificates were downgraded because the
bonds' credit enhancement levels, including excess spread and
subordination were too low compared to the current projected loss
numbers at the previous rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second
collateral.  Substantial pool losses of over the last few months
have eroded credit enhancement available to the mezzanine and
senior certificates.  Despite the large amount of write-offs due
to losses, delinquency pipelines have remained high as borrowers
continue to default.

Complete rating actions are:

Issuer: FFMLT 2007-FFB-SS, Mortgage Pass-Through Certificates,
Series 2007-FFB-SS

  -- Cl. M-2, Downgraded to A2 from Aa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-3, Downgraded to Baa2 from A2; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-4, Downgraded to Ba1 from A3
  -- Cl. M-5, Downgraded to Ba3 from Baa1
  -- Cl. M-6, Downgraded to B3 from Baa2

Issuer: First Franklin Mortgage Loan Trust 2005-FFA

  -- Cl. B-1, Downgraded to B2 from Baa1
  -- Cl. B-2, Downgraded to Caa2 from Ba2
  -- Cl. B-3, Downgraded to C from Ca

Issuer: First Franklin Mortgage Loan Trust 2007-FFC

  -- Cl. M-1, Downgraded to B3 from Aa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-2, Downgraded to Caa1 from A1
  -- Cl. M-3, Downgraded to Caa2 from A2
  -- Cl. M-4, Downgraded to Caa3 from A3
  -- Cl. B-1, Downgraded to Ca from Baa1
  -- Cl. B-2, Downgraded to Ca from Baa2
  -- Cl. B-3, Downgraded to C from B2
  -- Cl. B-4, Downgraded to C from B3


FLOWSERVE CORP: Moody's Holds Ratings and Changes Outlook to Pos.
-----------------------------------------------------------------
Moody's Investors Service affirmed Flowserve Corporation's Ba3
corporate family rating, Ba2 senior secured rating and B1
probability of default rating and changed the rating outlook to
positive from stable.  The rating action anticipates continued
strong end market demand for Flowserve's product offerings which
should support robust earnings and cash flow, as well as improved
coverage ratios.  In conjunction with debt repayment achieved over
the last several years, these favorable operating results should
enable the company to sustain financial metrics that are
supportive of a higher rating.

Moody's noted that Flowserve continues to make progress at
settling various legal and regulatory issues that have been a
constraint on the company's rating.  The positive outlook signals
Moody's belief that ratings could head higher should Flowserve
resolve remaining legal and regulatory issues while demonstrating
continued favorable operating trends, and a commitment to
maintaining its improved capital structure.

These ratings have been affirmed:

  -- Corporate family rating at Ba3
  -- Probability of default rating at B1
  -- Senior secured credit facilities at Ba2
     (to LGD2, 19% from LGD2, 20%)

Outlook Actions:

  -- Outlook, Changed To Positive From Stable

Flowserve's Ba3 corporate family rating considers the company's
leading market position as a provider of pumps, valves and
mechanical seals.  The company's products are used in various end
markets globally, with particular strength in the energy and
infrastructure markets which may offer favorable demand patterns
even as economic trends soften.  Flowserve benefits from a global
customer base, with a good representation of aftermarket service
revenues which should provide an element of stability into future
results.  Financial performance has improved over the last year
and ongoing strength of the company's end markets is likely to
support continued improvement in financial metrics.

While acknowledging these positive trends and the reduction of
indebtedness that has occurred over the last several years,
Moody's notes that Flowserve continues to work to resolve legal
and regulatory issues related to U.S. export control laws.  SEC
and DOJ investigations related to the Oil-for-food program were
settled in early 2008, which marks important progress in these
areas.  The positive rating outlook reflects Moody's expectation
that the company will continue to make progress at settling its
outstanding issues.

Headquartered in Irving, Texas, Flowserve Corporation is a leading
provider of pumps, valves and mechanical seals as well as related
services to various end markets globally.  Revenue for 2007
totaled roughly $3.8 billion.


FREMONT GENERAL: Inks $5.6 Bil. Asset Sale Deal with CapitalSource
------------------------------------------------------------------
CapitalSource Inc. has entered into a definitive asset purchase
agreement with Fremont Investment & Loan to assume all of Fremont
Investment's retail deposits of approximately $5.6 billion as of
March 31, 2008 and to operate its 22 retail banking branches.  The
transaction is subject to regulatory approval.

The company will file applications with the California Department
of Financial Institutions and with the Federal Deposit Insurance
Corporation to form a de novo California-chartered industrial
bank.  CapitalSource has communicated its plans to the FDIC and
DFI over recent months and expects to file the required
applications within approximately two weeks.  The company further
expects the transaction to close in the third quarter, following
receipt of regulatory approvals.
    
"This acquisition of branches and assumption of deposits will give
CapitalSource's new bank access to a significant base of deposits
with strong growth prospects,"  John K. Delaney, CapitalSource
chairman and chief executive officer, commented.  "Together with
CapitalSource's valuable commercial finance lending franchise,
this acquisition strengthens our business model and positions us
to grow by taking advantage of the attractive lending
opportunities now available in the market."
    
As part of the asset purchase agreement, the company's new bank
will acquire high quality assets approximately equal to the
deposits assumed including, approximately $3.0 billion of cash and
short-term investments and a commercial real estate loan
participation interest with a March 31, 2008 outstanding principal
balance of approximately $2.7 billion.
    
CapitalSource is not acquiring Fremont Investment, Fremont General
Corporation, any contingent liabilities, or business operations
except the retail branch network.
    
"We have long sought deposit funding as a way to further diversify
and strengthen our funding platform," Thomas A. Fink,
CapitalSource chief financial officer, said.  "This transaction
will accomplish that objective in an optimal and expeditious way."

"Forming the new bank and acquiring branches with $5.6 billion in
deposits will enhance CapitalSource's liquidity profile, increase
our profitability and improve our capital efficiency," Mr. Fink
added.  "Our business plan envisions the sale of approximately
$2.5 billion of CapitalSource loans to the new bank, making this
transaction immediately accretive."
    
CapitalSource is acquiring an 'A' participation interest and is
not acquiring the related 'B' participation interest.  The 'A'
participation interest receives 70% of the principal payments from
a $5.5 billion pool of commercial real estate loans.  As of
March 31, 2008, the 'A' participation interest was 48.8% of the
$5.5 billion pool.  The loans are managed by a subsidiary of iStar
Financial Inc.
    
"We conducted extensive loan-level diligence on the 'A'
participation interest to be acquired," Mr. Delaney stated.  "It
is well secured by a diverse portfolio of high-quality commercial
real estate assets and will continue to experience accelerated
paydowns because it has a preferential principal amortization
mechanism."

"In addition, we view iStar's role as asset manager to be a
significant advantage, as we hold iStar in very high regard and
view them as a 'best-in-class' manager of commercial real estate
debt and loan assets," Mr. Delaney continued.
    
"We look forward to welcoming FIL's retail banking customers and
employees to our new bank," Mr. Fink concluded.  "CapitalSource
will serve as a dependable source of financial strength for them."

                The Transaction According to Fremont

The definitive purchase and sale agreement was entered with
CapitalSource TRS Inc., a wholly-owned subsidiary of
CapitalSource.

The purchaser will pay a 2% premium on all the bank's deposits,
and will purchase the bank's participation interest in previously
sold commercial real estate loans at a 3% discount to its net book
value.  The bank's other assets to be sold in the transaction, at
net book value include real and personal property, cash and
certain other assets.  The purchaser will pay the bank at closing
an additional $58 million in cash.  The deposit premium, the $58
million in cash and the purchase price for the participation
interest, cash and other assets being sold by the bank will only
partially offset the deposits being assumed by the purchaser.

Consequently, in order to facilitate consummation of the
transaction, to the extent that the bank does not have sufficient
funds available at the time of the closing the agreement provides
that an affiliate of CapitalSource will provide the bank with a
loan of up to $200 million, to be secured by the bank's servicing
advance receivables.  The proposed transaction does not include
the sale of the bank's loan servicing operations.

In response to questions that it has received, the company is
advising that, after giving effect to a deposit premium of
approximately $112 million, based on estimated deposits of
$5.6 billion at March 31, 2008, the additional referenced cash
payment of $58 million, less the discount given on the commercial
real estate participation interest of approximately $80 million,
the company estimates that the net effect of the proposed
transaction will result in a premium to the bank of approximately
$90 million.

After giving effect to the proposed transaction, neither the
company nor the bank is able to provide any assurances as to
whether there will be any funds available to the company, its
creditors or its shareholder in view of the amount of the bank's
existing obligations and contingent claims.

As previously stated, completion of the proposed transaction is
subject to the approval of the Federal Deposit Insurance
Corporation and the California Department of Financial
Institutions, as well as approval of the company's shareholders
and the satisfaction of customary closing conditions.

                       About Fremont General

Headquartered in Brea, California, Fremont General Corporation
(NYSE: FMT) -- http://www.fremontgeneral.com/-- is a financial      
services holding company  which is engaged in deposit gathering
through a retail branch network in Central and Southern California
and residential real estate mortgage servicing through its wholly
owned subsidiary Fremont Investment & Loan.  Fremont Investment
funds its operations primarily through deposit accounts sourced
through its 22 retail banking branches which are insured up to the
maximum legal limit by the Federal Deposit Insurance Corporation.  
It had $8.8 billion in total assets at Sept. 30, 2007.

The Retail banking Division of Fremont Investment & Loan continues
to offer a variety of savings and money market products as well as
certificates of deposits across its 22 branch network. Customer
deposits remain fully insured by the FDIC up to at least $100,000
and retirement accounts remain insured separately up to an
additional $250,000.

                       About CapitalSource

Based in Chevy Chase, Maryland, CapitalSource Inc. (NYSE:CSE) --  
http://www.capitalsource.com/-- is a commercial lending,   
investment and asset management company focused on the middle
market.  The company operates as a real estate investment trust
and provides senior and subordinated commercial loans, invest in
real estate, engage in asset management and servicing activities,
and invest in residential mortgage assets.  On Jan. 1, 2006, it
began operating in two segments: commercial lending & investment
and residential mortgage investment.  The commercial lending &
investment segment includes commercial lending and investment
business, and the residential mortgage investment segment includes
activities related to the residential mortgage investments.  
During the year ended Dec. 31, 2006, the company diversified its
business to include real estate lease financing products and asset
management services.  During 2006, the company began acquiring
real estate for long-term investment purposes, all of which
involved healthcare properties.

                         *     *     *

As reported by the Troubled Company Reporter on March 31, 2008,
the Federal Deposit Insurance Corporation issued on March 26,
2008, a Supervisory Prompt Corrective Action Directive requiring
Fremont to recapitalize the Bank within 60 days, or by May 26,
2008.

As reported in the Troubled Company Reporter on March 5, 2008
Fremont General received notices from two affiliated third party
purchasers of an aggregate of $3.15 billion of residential sub-
prime mortgage loans that the company sold in March 2007, alleging
that the company was in default with respect to at least one of
several obligations that the company  had undertaken in connection
with the loan sales.

As reported in the TCR on March 6, 2008, Standard & Poor's Ratings
Services lowered its long-term counterparty credit rating on
Fremont General Corp. to 'CC' from 'CCC-'.  The rating remains on
CreditWatch Negative.


FREMONT GENERAL: NYSE Suspends Shares Trading, Plans Delisting
--------------------------------------------------------------
NYSE Regulation Inc. determined that the common stock of Fremont
General Corporation should be suspended prior to the opening on
Thursday, April 17, 2008.  NYSE Regulation will also suspend the
9% trust originated preferred securities of Fremont General
Financing I in connection with its removal of the company's common
stock.

The decision was reached in view of the fact that the company's
common stock had fallen below the New York Stock Exchange's
continued listing standard for average closing price of less than
$1.00 over a consecutive 30 trading day period.  NYSE Regulation
also considered the "abnormally low" price of the company's common
stock, which closed at $0.45 on April 11, 2008 with a resultant
common market capitalization of $35.8 million.

Furthermore, based on a review of all the circumstances
surrounding the company, NYSE Regulation has determined that the
company's securities are no longer suitable for listing on the
NYSE.  NYSE Regulation considered all the pertinent facts in
arriving at this determination and the disclosures made in recent
company press releases on February 28, March 18, March 28, and
April 14 2008, including these:

  * The Federal Deposit Insurance Corporation and the California
    Department of Financial Institutions issued a Supervisory
    Prompt Corrective Action Directive on March 26, 2008 which
    requires the company and its Bank subsidiary to take one or
    more actions to recapitalize the Bank within 60 days or by
    May 26, 2008, as it has been categorized as undercapitalized.  
    Though the company is working with Credit Suisse Securities
    LLC and Sandler O'Neill LLP to explore strategic alternatives,
    there is no assurance that these will be successful or that
    the company will be able to implement a strategy to comply
    with the Directive.

  * As part of its efforts to respond to the Directive, the
    company has entered into a definitive purchase and sale
    agreement with CapitalSource TRS Inc. that provides for the
    purchase of substantially all of the Bank's assets, which
    include the Bank's participation interest in certain
    previously sold commercial real estate loans, the assumption
    of all the Bank's deposits, and the acquisition of all the
    Bank's branches.  After giving effect to this proposed
    transaction, neither the company nor the Bank is able to
    provide any assurances as to whether there will be any funds
    available to the company, its creditors or its shareholders in
    view of the amount of the Bank's existing obligations and
    contingent claims.

  * The company has also deferred interest due on two obligations
    in connection with attempts to negotiate a comprehensive debt
    restructuring:

     1) the 9% trust originated preferred securities of Fremont
        General Financing I - ticker symbol FMT PR; and

     2) Series B 7.875% senior notes due March 2009.

  * The company is delayed in filing its Dec. 31, 2007 Form 10-K
    with the Securities and Exchange Commission and is not able to
    determine when it will be able to file.  The delay is
    attributable to ongoing reviews that may result in additional
    reserves, write-downs, or adjustments to the company's Bank
    subsidiary's regulatory capital, which could have an adverse
    effect on the company's financial condition, results of
    operations, and business.  As a result of the delayed Form
    10-K filing, the company will also not be able to hold its
    combined 2007 and 2008 annual meeting of shareholders by the
    April 30, 2008 date previously agreed to with NYSE Regulation.

The company has a right to a review of this determination by a
committee of the board of directors of NYSE Regulation.
Application to the SEC to delist the issues is pending the
completion of applicable procedures, including any appeal by the
company of the NYSE Regulation staff's decision.  The NYSE may, at
any time, suspend a security if it believes that continued
dealings in or listing of the security on the NYSE is not
advisable.

                       About Fremont General

Headquartered in Brea, California, Fremont General Corporation
(NYSE: FMT) -- http://www.fremontgeneral.com/-- is a financial      
services holding company  which is engaged in deposit gathering
through a retail branch network in Central and Southern California
and residential real estate mortgage servicing through its wholly
owned subsidiary Fremont Investment & Loan.  Fremont Investment
funds its operations primarily through deposit accounts sourced
through its 22 retail banking branches which are insured up to the
maximum legal limit by the Federal Deposit Insurance Corporation.  
It had $8.8 billion in total assets at Sept. 30, 2007.

The Retail banking Division of Fremont Investment & Loan continues
to offer a variety of savings and money market products as well as
certificates of deposits across its 22 branch network. Customer
deposits remain fully insured by the FDIC up to at least $100,000
and retirement accounts remain insured separately up to an
additional $250,000.

                         *     *     *

As reported in the Troubled company Reporter on March 5, 2008
Fremont General received notices from two affiliated third party
purchasers of an aggregate of $3.15 billion of residential sub-
prime mortgage loans that the company sold in March 2007, alleging
that the company was in default with respect to at least one of
several obligations that the company  had undertaken in connection
with the loan sales.

As reported in the TCR on March 6, 2008, Standard & Poor's Ratings
Services lowered its long-term counterparty credit rating on
Fremont General Corp. to 'CC' from 'CCC-'.  The rating remains on
CreditWatch Negative.


FREMONT HOME: Fitch Slashes Ratings on $704.2MM Certificates
------------------------------------------------------------
Fitch Ratings has taken rating actions on three Fremont Home Loan
Trust mortgage pass-through certificate transactions.  Unless
stated otherwise, any bonds that were previously placed on Rating
Watch Negative are removed from Rating Watch Negative.  
Affirmations total $955.4 million and downgrades total
$704.2 million.  Additionally, $131.8 million was placed on Rating
Watch Negative.  Break Loss percentages and Loss Coverage Ratios
for each class are included with the rating actions as:

Series 2005-1
  -- $79.1 million class M-1 affirmed at 'AA+'
     (BL: 94.16, LCR: 3.86);

  -- $80.2 million class M-2 affirmed at 'AA'
     (BL: 76.06, LCR: 3.12);

  -- $37.7 million class M-3 affirmed at 'AA-'
     (BL: 66.57, LCR: 2.73);

  -- $34.8 million class M-4 affirmed at 'A+'
     (BL: 50.63, LCR: 2.08);

  -- $40.6 million class M-5 affirmed at 'A'
     (BL: 46.30, LCR: 1.90);

  -- $31.9 million class M-6 downgraded to 'BBB' from 'A-'
     (BL: 39.03, LCR: 1.60);

  -- $26.1 million class M-7 downgraded to 'BB' from 'BBB+'
     (BL: 32.18, LCR: 1.32);

  -- $24.1 million class M-8 downgraded to 'B' from 'BBB'
     (BL: 25.77, LCR: 1.06);

  -- $19.3 million class M-9 downgraded to 'CCC' from 'BB'
     (BL: 20.27, LCR: 0.83);

  -- $12.6 million class B-1 downgraded to 'CC/DR5' from 'BB-'
     (BL: 16.43, LCR: 0.67);

  -- $19.3 million class B-2 revised to 'C/DR6' from 'C/DR4'
     (BL: 11.22, LCR: 0.46).

Deal Summary
  -- Originators: 100% Fremont Investment & Loan;
  -- 60+ day Delinquency: 34.43%;
  -- Realized Losses to date (% of Original Balance): 2.03%;
  -- Expected Remaining Losses (% of Current balance): 24.36%;
  -- Cumulative Expected Losses (% of Original Balance): 7.22%.

Series 2005-C
  -- $42.7 million class 1-A-1 affirmed at 'AAA'
     (BL: 91.14, LCR: 3.37);

  -- $10.7 million class 1-A-2 affirmed at 'AAA'
     (BL: 85.12, LCR: 3.15);

  -- $16.5 million class 2-A-3 affirmed at 'AAA'
     (BL: 97.45, LCR: 3.60);

  -- $38.5 million class 2-A-4 affirmed at 'AAA'
     (BL: 82.84, LCR: 3.06);

  -- $54.2 million class M-1 affirmed at 'AA+'
     (BL: 68.47, LCR: 2.53);

  -- $31.0 million class M-2 affirmed at 'AA'
     (BL: 59.90, LCR: 2.21);

  -- $19.1 million class M-3 rated 'AA-', placed on Rating Watch
     Negative (BL: 51.04, LCR: 1.89);

  -- $19.1 million class M-4 downgraded to 'A' from 'A+'
     (BL: 46.79, LCR: 1.73);

  -- $18.6 million class M-5 downgraded to 'BBB' from 'A+'
     (BL: 42.27, LCR: 1.56);

  -- $16.0 million class M-6 downgraded to 'BB' from 'A'
     (BL: 38.02, LCR: 1.40);

  -- $16.5 million class M-7 downgraded to 'B' from 'A-'
     (BL: 33.30, LCR: 1.23);

  -- $13.4 million class M-8 downgraded to 'B' from 'BBB+'
     (BL: 29.26, LCR: 1.08);

  -- $10.3 million class M-9 downgraded to 'CCC' from 'BBB'
     (BL: 25.98, LCR: 0.96);

  -- $10.3 million class B-1 downgraded to 'CCC' from 'BB'
     (BL: 22.68, LCR: 0.84).

Deal Summary
  -- Originators: 100% Fremont Investment & Loan;
  -- 60+ day Delinquency: 35.07%;
  -- Realized Losses to date (% of Original Balance): 1.97%;
  -- Expected Remaining Losses (% of Current balance): 27.06%;
  -- Cumulative Expected Losses (% of Original Balance): 11.28%.

Series 2005-E
  -- $207.5 million class 1-A-1 affirmed at 'AAA'
     (BL: 64.58, LCR: 2.12);

  -- $43.4 million class 2-A-2 affirmed at 'AAA'
     (BL: 98.63, LCR: 3.23);

  -- $238.6 million class 2-A-3 affirmed at 'AAA'
     (BL: 64.10, LCR: 2.10);

  -- $112.7 million class 2-A-4 rated 'AAA', placed on Rating
     Watch Negative (BL: 59.09, LCR: 1.94);

  -- $86.7 million class M-1 downgraded to 'A' from 'AA+'
     (BL: 50.55, LCR: 1.66);

  -- $80.2 million class M-2 downgraded to 'BBB' from 'AA'
     (BL: 43.73, LCR: 1.43);

  -- $53.8 million class M-3 downgraded to 'BB' from 'A+'
     (BL: 38.86, LCR: 1.27);

  -- $38.4 million class M-4 downgraded to 'B' from 'A'
     (BL: 35.32, LCR: 1.16);

  -- $38.4 million class M-5 downgraded to 'B' from 'A-'
     (BL: 31.77, LCR: 1.04);

  -- $34.0 million class M-6 downgraded to 'CCC' from 'BBB'
     (BL: 28.50, LCR: 0.93);

  -- $34.0 million class M-7 downgraded to 'CCC' from 'BBB-'
     (BL: 24.98, LCR: 0.82);

  -- $25.3 million class M-8 downgraded to 'CC/DR5' from 'BB'
     (BL: 22.42, LCR: 0.74);

  -- $27.5 million class M-9 downgraded to 'CC/DR5' from 'B'
     (BL: 19.84, LCR: 0.65);

  -- $25.3 million class B-1 downgraded to 'CC/DR5' from 'B'
     (BL: 17.65, LCR: 0.58);

  -- $5.5 million class B2-A revised to 'C/DR6' from 'C/DR5'
     (BL: 16.05, LCR: 0.53);

  -- $5.0 million class B2-B revised to 'C/DR6' from 'C/DR5'
     (BL: 16.05, LCR: 0.53);

  -- $5.0 million class B2-C revised to 'C/DR6' from 'C/DR5'
     (BL: 16.05, LCR: 0.53);

  -- $7.6 million class B2-D revised to 'C/DR6' from 'C/DR5'
     (BL: 16.05, LCR: 0.53).

Deal Summary
  -- Originators: 100% Fremont Investment & Loan;
  -- 60+ day Delinquency: 37.41%;
  -- Realized Losses to date (% of Original Balance): 2.27%;
  -- Expected Remaining Losses (% of Current balance): 30.50%;
  -- Cumulative Expected Losses (% of Original Balance): 18.01%.

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 2005 with regard to continued poor loan performance and
home price weakness.  


FREMONT HOME: Moody's Junks Rating on Cl. SL-A Certificates
-----------------------------------------------------------
Moody's Investors Service has downgraded two certificates from a
transaction issued by Fremont Home Loan Trust.  The transaction is
backed by second lien loans.  The certificates were downgraded
because the bonds' credit enhancement levels, including excess
spread and subordination were low compared to the current
projected loss numbers at the previous rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second
collateral.  Substantial pool losses of over the last few months
have eroded credit enhancement available to the mezzanine and
senior certificates.  Despite the large amount of write-offs due
to losses, delinquency pipelines have remained high as borrowers
continue to default.

Complete rating actions are:

Issuer: Fremont Home Loan Trust 2006-B

  -- Cl. SL-A, Downgraded to Caa2 from B3
  -- Cl. SL-M1, Downgraded to C from Ca


FRONTIER AIRLINES: Denver Airport Rating Not Affected by Filing
---------------------------------------------------------------
Fitch Ratings affirms its 'A+' rating and stable outlook for the
City and County of Denver, Colorado's approximately $3.6 billion
outstanding revenue bonds issued for Denver International Airport.
   
Frontier Airlines, the airport's second largest carrier,
representing approximately 23% of the airport's enplaned
passengers in 2007, filed for protection under Chapter 11 of the
U.S. Bankruptcy Code.  The carrier continues to operate its full
schedule, and the bankruptcy filing is not expected to have an
immediate effect on the airport's financial operations.

The airport indicates that the airline owes approximately
$1.8 million in pre-petition debt, landing fees payable April 20.
The airport required Frontier to post a $3 million letter of
credit as a security deposit to mitigate such an event.
   
With Frontier continuing to operate, the immediate effect on the
airport should be negligible as the airline is required to make
all post-petition payments due under the airport's use and lease
agreement.  Of more consequence would be an eventual liquidation
of Frontier, which would eliminate a sizeable operator at the
airport.  As Frontier had not established a debtor-in-possession
financing facility upon filing for protection, and market factors
may work against the carrier as it pursues its reorganization,
Fitch cannot rule out this possibility.
   
Denver is a strong origination and destination market, thus Fitch
believes other carriers -- notably Southwest Airlines and United
Airlines -- will likely act to capture market share in the event
of a liquidation of Frontier.  However, in light of the current
economics of the industry, this backfilling may be on a more
limited basis and take place over a longer period of time than in
prior years.

Thus Fitch would anticipate a decline in annual enplanements and a
resultant increase in airport's cost per enplaned passenger. As
the airport maintains a strong financial position, with cash on
hand consistently exceeding 400 days of expenses and debt service
coverage of 1.8 times (x) in 2006, Fitch believes the airport
should be able to sustain its financial operations through a
short-term market dislocation.
   
The airport is planning a gate expansion on Concourse C.  However,
the airport has not yet let the contract for this project and thus
maintains the ability to defer or eliminate it should conditions
warrant.  If Frontier leave, the airport would have ample capacity
to meet the demand of incumbent carriers for gates on Concourse A.


FUSION TELECOM: Appoints Gordon Hutchins Jr. to President and CEO
-----------------------------------------------------------------
On March 26, 2008, Fusion Telecommunications International Inc.
appointed Gordon Hutchins, Jr. as president and chief operating
officer to succeed Matthew D. Rosen, who remains as chief
executive officer and director.

Mr. Hutchins served as executive vice president - Operations since
May 2006, and served as executive vice president - International
Operations from December 2005, until May 2006.  Prior to his
employment with Fusion, Mr. Hutchins served as president and chief
executive officer of SwissFone Inc.  Prior to SwissFone, Mr.
Hutchins was president and chief executive officer of STAR
Telecommunications, Inc., an international telecommunications
carrier, where he was hired to lead the company's restructuring
following the filing of its bankruptcy petition.

Mr. Hutchins has also served since 1989 as president and chief
executive officer of GH Associates Inc., a management-consulting
firm that he founded.  As an entrepreneur, Mr. Hutchins also
founded Telecom One Inc., a nationwide long distance carrier that
he sold to Broadwing Communications Inc., and TCO Network Services
Inc., a local wireless services carrier purchased by Winstar
Communications Inc.  During his early career, Mr. Hutchins served
as president and chief executive officer of LDX NET Inc., a fiber
optic network company, and held positions with MCI, McDonnell
Douglas Corporation, and AT&T.

Mr. Hutchins does not have an employment agreement with the
company.  His promotion to president and chief operating officer
provides for an increase in his annual salary from $220,000 to
$250,000, and he will retain a targeted bonus opportunity equal to
25% of annual salary, based on achievement of corporate
performance metrics.  Concurrent with the promotion, he was also
granted 200,000 Incentive Stock Options.  At the request of
Mr. Hutchins, his salary increase has been deferred pending the
achievement of certain short-term corporate performance
benchmarks.

                 About Fusion Telecommunications

Fusion Telecommunications International Inc. (AMEX: FSN) --
http://www.fusiontel.com/-- delivers a full range of advanced IP-
based services to corporations, consumers and carriers worldwide.
Fusion's Efonica-branded VoIP products and services, which focus
primarily on Asia, the Middle East, Africa and Latin America, have
over one million subscribers from more than 100 countries.

At Dec. 31, 2007, the company's consolidated balance sheet showed
$18,128,289 in total assets, $11,433,106 in total liabilities, and
$6,695,183 in total stockholders' equity.

                       Going Concern Doubt

Rothstein, Kass & Company P.C., in Roseland, N. J., expressed
substantial doubt about Fusion Telecommunications International
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 negative working capital balances, negative cash flows
from operations, net losses since inception, and limited capital
to fund future operations.


GENERAL GROWTH: Moody's Cuts Unsecured Debt Rating to Ba2 from Ba1
------------------------------------------------------------------
Moody's Investors Service has affirmed the Ba2 senior secured bank
debt ratings of General Growth Properties, Inc. and certain of its
subsidiaries and concurrently downgraded the senior unsecured debt
ratings of The Rouse Company LP to Ba2 from Ba1.  The outlook on
both ratings is stable.

The affirmation of General Growth's senior secured bank debt
ratings, with a stable outlook, reflects Moody's expectation that
General Growth will manage through its significant refinancing and
development funding needs over the next two years.  Moody's also
expects no major retailer bankruptcies, with GGP maintaining solid
operating performance at its retail centers, through what could be
a protracted economic downturn and remain a leader in the mall
space.  In addition, Moody's expects that General Growth will
continue to reduce its leverage, and at least maintain its credit
metrics on a consolidated basis.

The downgrade of The Rouse Company LP bonds reflected an increased
likelihood that the unencumbered portfolio and unencumbered net
operating income of The Rouse Company will be negatively affected
due to General Growth's strained financial flexibility in a
capital constrained environment.  The REIT has significant
refinancing and development funding needs over the next two years
that are coupled with a substantial weakening in the master-planed
communities business and expected earnings pressure due to a
potentially protracted downturn in the economy that could pressure
the cushion at both the secured debt and interest coverage
covenants for the Rouse bonds.  

Moody's notes that the operating performance of GGP's core retail
business remains solid, supported by a high-quality, well-
diversified portfolio and a strong market position as one of the
top players in the highly concentrated U.S. regional mall sector.

Moody's stated that positive ratings movement would reflect the
following: fixed charge coverage including principal amortization
and joint venture-related debt closer to 1.8X, effective leverage
closer to mid 60% and secured debt under 40% of gross assets,
supported by deeper market leadership.  GGP's ratings are
constrained by its highly levered balance sheet.  The GGP upgrade
story is a balance sheet and funding one, not an operating one.  
Negative ratings adjustments would likely reflect any weakening of
the REIT's current credit metrics, any refinancing or funding
challenges, and or an acute reversal in earnings strength or
stability.

These ratings were affirmed with a stable outlook:

  * GGP Limited Partnership -- Senior secured bank debt at Ba2,
    and senior unsecured debt shelf at (P)Ba2

  * General Growth Properties, Inc. -- Senior secured bank debt at
    Ba2, and preferred stock shelf at (P)B1

These ratings were downgraded with a stable outlook:

  * The Rouse Company LP -- Senior unsecured debt to Ba2 from Ba1.

General Growth Properties, Inc. (NYSE: GGP), headquartered in
Chicago, Illinois, USA, is one of the largest owners and operators
of regional malls in the United States.  The REIT reported assets
of $28.8 billion, and equity of $1.5 billion, at Dec. 31, 2007.


GLOBAL CREDIT: S&P Designates 'B+' Ratings on Negative CreditWatch
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on the issue
of Global Credit Pref Corp.'s preferred shares on CreditWatch with
negative implications.  The CreditWatch placement mirrors the
CreditWatch action on the credit-linked note to which the issue of
preferred shares is linked.
     
Standard & Poor's will continue to monitor the underlying
portfolio and expects to resolve the CreditWatch placement within
a period of 90 days and update its opinion.

                     Global Credit Pref Corp.
              Ratings Placed On CreditWatch Negative

                               To                    From   
                               --                    ----
   Preferred shares
    Global scale:              B+/Watch Neg          B+
    Canada national scale:     P-4(High)/Watch Neg   P-4(High)

(Related CLN: The Toronto-Dominion Bank CN$48,031,000 Portfolio
Credit Linked Notes)


GLOBAL TEL*LINK: Moody's Holds B2 CF Rating with Stable Outlook
---------------------------------------------------------------
Moody's Investors Service affirmed Global Tel*Link Corporation's
B2 corporate family rating, senior secured bank ratings and stable
outlook.  The affirmation and stable outlook assume that GTEL will
continue to make steady progress integrating the MCI-DOCS
acquisition and that liquidity will remain adequate over the near-
term.  The B2 corporate family rating continues to reflect GTEL's
high leverage, small size, narrow focus within the communications
services industry and regulatory risks.  Furthermore, low
operating margins suggest an intense competitive environment,
which Moody's does not expect to change materially over the near-
term.  Strong market share within the correctional
telecommunications industry, a track record of successful
integration of acquisitions, and recurring revenue support the
ratings.

Global Tel*Link Corporation

  -- Affirmed B2 Corporate Family Rating
  -- Affirmed B3 Probabiliy of Default Rating
  -- Affirmed B2 Secured Bank Rating, LGD3, 32%

Outlook: Stable

Global Tel*Link Corporation, based in Mobile, Alabama, is a
telecommunications provider to correctional facilities.  GTEL
acquired the former MCI corrections division from Verizon on
July 18, 2007, to become the largest such provider in the United
States, serving 1,500 facilities and over 1 million inmates.  GTEL
is majority owned by The Gores Group, LLC.  Minority owners
include Goldman Sachs and members of GTEL's management team.


GENERAL MOTORS: Idles Arlington Assembly Plant for Three Weeks
--------------------------------------------------------------
General Motors Corp. idled an assembly plant in Arlington, Texas,
for three weeks, starting April 14, 2008, due to low demand of
sport utility vehicles, The Associated Press reports.

The plant, which manufactures large SUVs such as the Chevrolet
Tahoe/GMC Yukon, Chevrolet Suburban/GMC Yukon XL, and Cadillac
Escalade, will displace 2,400 employees, AP relates.

As reported in the Troubled Company Reporter on April 2, 2008,
GM dealers in the U.S. delivered 282,732 vehicles in March, a
decrease of 13% when compared with the same month a year ago.  For
the first three months of 2008, GM total sales of 805,720 vehicles
were down 11% compared with a year ago.  Retail share appears to
have remained stable throughout the month and the quarter.

AP recounts that GM distributed some axles from the plant to other
plants that makes pickup trucks due to the strike of GM auto parts
supplier American Axle & Manufacturing Holdings Inc.  

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries.  In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.

                          *     *     *

As reported in the Troubled Company Reporter on March 26, 2008,
Standard & Poor's Ratings Services placed the ratings on General
Motors Corp., American Axle & Manufacturing Holdings Inc., Lear
Corp., and Tenneco Inc. on CreditWatch with negative implications.   
The CreditWatch placement reflects S&P's decision to review the
ratings in light of the extended American Axle (BB/Watch Neg/--)
strike.
     
The work stoppage that began Feb. 25 at American Axle's U.S.
United Auto Workers plants has forced closure of many GM (B/Watch
Neg/B-3) plants, as well as plants of certain GM suppliers.  The
strike began after the expiration of the four-year master labor
agreement with American Axle.  Although S&P still expects American
Axle and the UAW to reach an agreement that will reflect more
competitive labor costs, the timing is unknown.

To resolve the CreditWatch listings, S&P's will assess the
strike's impact on the companies' credit profiles, particularly
liquidity, once production resumes.  S&P could lower the ratings
any time prior to a resolution of the Axle strike if the liquidity
of the companies becomes compromised, although downgrades are not
likely for another several weeks.

As reported in the Troubled Company Reporter on Feb. 28, 2008,
Fitch Ratings has affirmed the Issuer Default Rating of General
Motors at 'B', with a Rating Outlook Negative.

As reported in the Troubled Company Reporter on Nov. 9, 2007,
Moody's Investors Service affirmed its rating for General Motors
Corporation (B3 Corporate Family Rating, Ba3 senior secured, Caa1
senior unsecured and SGL-1 Speculative Grade Liquidity rating) but
changed the outlook to Stable from Positive.  In an environment of
weakening prospects for US auto sales GM has announced that it
will take a non-cash charge of $39 billion for the third quarter
of 2007 related to establishing a valuation allowance against its
deferred tax assets in the US, Canada and Germany.

As reported in the Troubled Company Reporter on Oct. 23, 2007,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on General Motors Corp. and
removed them from CreditWatch with positive implications, where
they were placed Sept. 26, 2007, following agreement on the new
labor contract.  The outlook is stable.


GMAC COMMERCIAL: Moody's Affirms 'C' Rating on $15.261MM Certs.
---------------------------------------------------------------
Moody's Investors Service upgraded the ratings of two classes and
affirmed the ratings of three classes of GMAC Commercial Mortgage
Securities, Inc., Mortgage Pass-Through Certificates, Series
1997-C2 as:

  -- Class X, Notional, affirmed at Aaa
  -- Class E, $5,693,655, upgraded to Aaa from A1
  -- Class F, $48,271,000, upgraded to A3 from Ba3
  -- Class G, $13,409,000, affirmed at B3
  -- Class H, $15,261,921, affirmed at C

Moody's is upgrading Classes E and F due to increased credit
subordination and defeasance.

As of the March 17, 2008 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 92.3%
to $82.6 million from $1.1 billion at securitization.  The
Certificates are collateralized by 11 loans ranging in size from
less than 1.0% to 21.9% of the pool.  Two loans, representing
18.0% of the pool balance, have defeased and are secured by U.S.
Government securities.

Sixteen loans have been liquidated from the trust, resulting in an
aggregate realized loss of approximately $55.8 million.  Currently
two loans, representing 4.5% of the pool, are in special
servicing.  Moody's is estimating an aggregate loss of
$2.4 million for the specially serviced loans.  Currently there
are no loans on the master servicer's watchlist.

Moody's was provided with full-year 2006 and partial-year 2007
operating results for approximately 92.0% and 57.0% of the
performing loans, respectively.  Moody's weighted average loan to
value ratio is 78.5%, excluding the specially serviced loans,
compared to 76.9% at Moody's last full review in September 2006
and 91.4% at securitization.

The top three loans represent 55.6% of the outstanding pool
balance.  The largest loan is the Fruitvale Shopping Center Loan
($18.1 million -- 21.9%), which is secured by a 163,000 square
foot retail center located in Oakland, California.  The center was
100.0% occupied as of September 2007, essentially the same as at
last review.  The anchor tenants include Albertson's and Office
Depot, which collectively occupy 57.0% of the premises on long
term leases.  Moody's LTV is 61.6% compared to 65.3% at last
review.

The second largest loan is the Clinton Hill Apartments Loan
($15.0 million -- 18.1%), which is secured by a 1,221-unit
cooperative apartment complex located in Brooklyn, New York.  The
property was 99.0% occupied as of March 2007 compared to 95.0% at
securitization.  Moody's LTV is 85.9% compared to 88.3% at last
review.

The third largest loan is the Boulevard Garden Apartments Loan
($12.9 million -- 15.7%), which is secured by a 968 unit
cooperative apartment complex located in Queens, New York.  
Moody's LTV is 88.9% compared to 91.1% at last review.


GORDON GANZ: Files for Bankruptcy After Closure of Grain Business
-----------------------------------------------------------------
Gordon Ganz the owner of Alvo Grain and Feed, a grain company in
Nebraska, sought bankruptcy protection on April 4, 2008, various
reports say.

The filing comes after the Nebraska Public Service Commission
order the closure of Mr. Ganz's grain warehouses in Alvo and
Ashland, Nebraska after his failure to pay debts, reports relate.

Mr. Ganz, according to the reports, asked for more funds from bank
lenders but failed.

Mr. Ganz owes more than $520,000 to creditors, reports quote grain
warehouse director John Fecht as saying.

A bankruptcy hearing is slated this week, reports adds.


GOULD CITY: Council Decides to Hire Bankruptcy Attorney
-------------------------------------------------------
The city of Gould has decided to file for Chapter 9 creditor
protection, Pine Bluff Commercial (Ark.) reports.  City council
members have voted to hire a Little Rock bankruptcy attorney to
work with the city, the report stated.  

City mayor Juanita Stephens could not immediately cite the debt
total, but she did mention that the city owes $224,000 from the
Internal Revenue Service, according to the report.  The city
reportedly is almost a half-million dollars in the red.

Gould is a city in Lincoln County, Arkansas, with a  population of
1,305 as of the 2000 U.S. census. It is included in the Pine
Bluff, Arkansas Metropolitan Statistical Area.


GSC ABS: Poor Credit Quality Cues Moody's to Downgrade Ratings
--------------------------------------------------------------
Moody's Investors Service has downgraded and left on review for
possible downgrade these notes issued by GSC ABS Funding 2006-3g,
Ltd.:

Class Description: $1,085,000,000 Class A-1LT Floating Rate Notes
Due June 2042

  -- Prior Rating: Aa2, on review for possible downgrade
  -- Current Rating: Ba1, on review for possible downgrade

Class Description: $35,000,000 Class A-1-a Floating Rate Notes Due
June 2042

  -- Prior Rating: Aa2, on review for possible downgrade
  -- Current Rating: Ba1, on review for possible downgrade

Class Description: $192,000,000 Class A-1-b Floating Rate Notes
Due June 2042

  -- Prior Rating: Baa1, on review for possible downgrade
  -- Current Rating: Caa1, on review for possible downgrade

In addition Moody's also announced that it has downgraded these
notes:

Class Description: $104,000,000 Class A-2 Floating Rate Notes Due
June 2042

  -- Prior Rating: B2, on review for possible downgrade
  -- Current Rating: Ca

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


HANCOCK FABRIC: Wants $100 Mil. GE Capital Exit Financing Approved
------------------------------------------------------------------
Hancock Fabrics Inc. and its debtor-affiliates seek the United
States Bankruptcy Court for the Delaware's authority to enter into
(a) a commitment letter and a fee letter for an exit financing
facility, and (b) related indemnification and other obligations,
with General Electric Capital Corporation.

GE Capital has committed to provide the Debtors with a revolving
line of credit in the maximum amount of $100,000,000.  

In connection with the Commitment and Fee Letters, the Debtors
further seek permission to pay related fees and expenses to GE
Capital.

The Debtors require the exit financing to refinance their
existing secured indebtedness, fund a plan of reorganization, and
finance their post-emergence operating expenses and other working
capital needs, Robert J. Dehney, Esq., at Morris, Nichols, Arsht
& Tunnell LLP, in Wilmington, Delaware, relates.

According to Mr. Dehney, the Debtors, with the assistance of
Houlihan Lokey Howard & Zukin, LLC, and in close consultation
with the Official Committee of Unsecured Creditors and their
professionals, canvassed 44 potential lenders to provide the exit
financing.  Thirty-eight of potential lenders entered into
confidentiality agreements with the Debtors and conducted at
least some level of due diligence.  Two potential lenders were
willing to commit to funding an A-piece exit financing.  The
Debtors, however, determined that the exit financing proposed by
GE Capital offers the more competitive terms.

Under the exit financing facility, GE Capital will be the lender
and the administrative agent.  All subsidiaries of Hancock
Fabrics, Inc., will be the guarantors.  The Debtors may borrow up
to $100,000,000, with a term of 60 months.  The maximum amount
includes a letter of credit sub-facility of up to $20,000,000.

The borrowing availability is the sum of up to:

   (i) 85% of the Debtors' eligible accounts receivable, less
       reserves;

  (ii) 90% of the net orderly liquidation value of eligible
       inventory, less reserves; and

(iii) 60% of the adjusted appraised fair market value of owned
       real estate, less reserves,

but not to exceed the maximum amount.

The interest rates to be applied will be either a floating rate
equal to the index rate plus the applicable margins or, if the
Debtors will not commit a default, a fixed rate for periods of
one, two or three months equal to the reserve adjusted London
Interbank Offered Rate plus the applicable margins.

The Exit Financing will be secured by a fully perfected first
priority security interest in all of the Debtors' assets,
existing or acquired in the future.

The Debtors will pay $75,000 as an underwriting deposit upon
their acceptance of GE Capital's commitment.  The deposit will be
used to pay transaction expenses to be incurred before the
Debtors make the loan -- the Closing Date.  The Debtors will pay
additional amounts so that the underwriting deposit's unused
balance remains at least $35,000 at all times.  GE Capital will
return any unused balance as of the Closing Date.

GE Capital's commitment to provide financing in accordance with
the terms of the Commitment Letter will cease if the Revolver
does not close on or before August 29, 2008.

In addition, GE Capital's commitment is subject to the
satisfaction or waiver of certain conditions specified in the
term sheet attached as an exhibit to the Commitment Letter,
including:

   * on or before April 30, 2008, the Commitment Letter will
     have been approved by the Court;

   * the Debtors will have received at least $20,000,000 in cash
     from the issuance of subordinated debt or equity;

   * GE Capital will have completed all legal due diligence, with
     results reasonably satisfactory to GE Capital; and

   * the parties will have negotiated, executed and delivered of
     definitive agreements.

The Debtors will pay an acceptance fee computed as 40% of the
Exit Financing's maximum amount upon accepting GE Capital's
commitment, and a closing fee computed as 20% of the maximum
amount on the Closing Date.

The Debtors will pay annual collateral monitoring fees of
$50,000, on the Closing Date and on each anniversary of the
Closing Date.

GE Capital will also receive a prepayment premium of 1% of the
Maximum Amount if the commitment is terminated prior to the first
anniversary of the closing of the Revolver, and 0.50% upon a
prepayment during the second year following the closing of the
Revolver -- subject to waiver if GE Capital closes a refinancing
facility during that period.

Under the Commitment Letter, the Debtors must reimburse other
fees related to the Exit Financing, whether or not the Exit
Financing Facility closes.  The Debtors also must indemnify and
release GE Capital and its affiliates from any actions and
claims.

Mr. Dehney further relates that the Debtors also have been
negotiating to secure a B-piece exit financing to supplement the
Exit Financing.  The B-piece financing is not only necessary to
finance the Debtors' emergence from their Chapter 11 Cases, it is
also a requirement set forth in the Commitment Letter.  The
Commitment Letter contemplates that the Debtors secure not less
than $20,000,000 in cash from the issuance of subordinated debt
or equity.

The Debtors will ask the Court to approve a B-piece financing as
soon as they finalize their commitment letter, Mr. Dehney says.

A full-text copy of the Exit Financing Facility is available for
free at http://ResearchArchives.com/t/s?2a7e

                     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. 28, Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000).


HAWTHORNE ON NORTH: Case Summary & 11 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Hawthorne on North 3rd, L.L.C.
        Attn: Jonathan P. Ibsen
        Jaburg & Wilk, P.C.
        3200 N. Central Ave., Ste. 2000
        Phoenix, AZ 85012
        Tel: (602) 248-1000

Bankruptcy Case No.: 08-04094

Type of Business: The Debtor is a home builder.

Chapter 11 Petition Date: April 14, 2008

Court: District of Arizona (Phoenix)

Debtor's Counsel: Jonathan P. Ibsen, Esq.
                     (jpi@jaburgwilk.com)
                  Jaburg & Wilk, PC
                  3200 N. Central Ave., Ste. 2000
                  Phoenix, AZ 85012
                  Tel: (602) 248-1054
                  Fax: (602) 248-1085
                  http://www.jaburgwilk.com/

Estimated Assets: $10 million to $50 million

Estimated Debts:  $10 million to $50 million

Debtor's 11 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Carmen, LLC                    $578,439
18700 W. 10 Mile Road,
2nd Flr.
Southfield, MI 48075

Dale Fuller                    $451,000
18700 W. 10 Mile Road,
1st Flr.
Southfield, MI 48075

Lenox Square, LLC              $398,000
18700 W. 10 Mile Road,
2nd Flr.
Southfield, MI 48075

JE& SI, LLC                    $375,000
18700 W. 10 Mile Road,
2nd Flr.
Southfield, MI 48075

RDR, LLC                       $327,200
18700 W. 10 Mile Road,
2nd Flr.
Southfield, MI 48075

Ronald Lederman                $249,000

Ronald Ossipove                $199,900

Fenton Pheasant Run Apts.,     $125,000
LLC

PB & Associates, Inc.          $124,326

Maricopa County Treasurer      $120,000

Town Center Medical Office     $8,000


HSBC HOME: Fitch Junks Ratings on 14 Certificate Classes
--------------------------------------------------------
Fitch Ratings has taken rating actions on seven HSBC Home Equity
mortgage pass-through certificates.  Unless stated otherwise, any
bonds that were previously placed on Rating Watch Negative are now
removed.  Affirmations total $1.5 billion and downgrades total
$422.2 million.  Additionally, $215.6 million was placed on Rating
Watch Negative.  Break Loss percentages and Loss Coverage Ratios
for each class are included with the rating actions as:

HSBC Home Equity Loan Trust 2005-1
  --$261.3 million class A affirmed at 'AAA',
    (BL: 65.98, LCR: 15.38);

  --$73.8 million class M affirmed at 'AA',
    (BL: 59.24, LCR: 13.81).

Deal Summary
  --Originators: HSBC Finance Corporation (100%);
  --60+ day Delinquency: 2.67%;
  --Realized Losses to date (% of Original Balance): 0.49%;
  --Expected Remaining Losses (% of Current balance): 4.29%;
  --Cumulative Expected Losses (% of Original Balance): 2.61%.

HSBC Home Equity Loan Trust 2005-2
  --$217.9 million class A-1 affirmed at 'AAA',
    (BL: 74.84, LCR: 12.45);

  --$54.5 million class A-2 affirmed at 'AAA',
    (BL: 69.19, LCR: 11.51);

  --$43.0 million class M-1 affirmed at 'AA+',
    (BL: 65.19, LCR: 10.84);

  --$43.0 million class M-2 affirmed at 'AA',
    (BL: 61.97, LCR: 10.31).

Deal Summary
  --Originators: HSBC Finance Corporation (100%);
  --60+ day Delinquency: 3.60%;
  --Realized Losses to date (% of Original Balance): 0.66%;
  --Expected Remaining Losses (% of Current balance): 6.01%;
  --Cumulative Expected Losses (% of Original Balance): 3.58%.

HSBC Home Equity Loan Trust 2005-3
  --$199.8 million class A-1 affirmed at 'AAA',
    (BL: 71.59, LCR: 11.69);

  --$49.9 million class A-2 affirmed at 'AAA',
    (BL: 65.43, LCR: 10.69);

  --$43.3 million class M-1 affirmed at 'AA+',
    (BL: 60.58, LCR: 9.9);

  --$35.1 million class M-2 affirmed at 'AA',
    (BL: 57.44, LCR: 9.38).

Deal Summary
  --Originators: HSBC Finance Corporation (100%);
  --60+ day Delinquency: 3.31%;
  --Realized Losses to date (% of Original Balance): 0.54%;
  --Expected Remaining Losses (% of Current balance): 6.12%;
  --Cumulative Expected Losses (% of Original Balance): 3.85%.

HSI Asset Securitization Corporation Trust 2005-I1
  --$53.9 million class I-A downgraded to 'AA' from 'AAA', placed
    on Rating Watch Negative (BL: 33.18, LCR: 1.59);

  --$5.9 million class II-A-1 affirmed at 'AAA',
    (BL: 81.84, LCR: 3.92);

  --$41.3 million class II-A-2 affirmed at 'AAA',
    (BL: 51.22, LCR: 2.45);

  --$112.7 million class II-A-3 downgraded to 'AA' from 'AAA',
    placed on Rating Watch Negative (BL: 33.29, LCR: 1.59);

  --$30.0 million class II-A-4 downgraded to 'AA' from 'AAA',
    placed on Rating Watch Negative (BL: 31.55, LCR: 1.51);

  --$32.8 million class M1 downgraded to 'B' from 'AA+'
    (BL: 20.91, LCR: 1);

  --$9.2 million class M2 downgraded to 'CCC' from 'AA'
    (BL: 17.80, LCR: 0.85);

  --$3.2 million class M3 downgraded to 'CCC' from 'AA-'
    (BL: 16.69, LCR: 0.8);

  --$2.9 million class M4 downgraded to 'CCC' from 'A+'
    (BL: 15.65, LCR: 0.75);

  --$2.9 million class M5 downgraded to 'CC/DR6' from 'A'
    (BL: 14.61, LCR: 0.7);

  --$7.2 million class M6 downgraded to 'CC/DR6' from 'A-'
    (BL: 11.97, LCR: 0.57).

Deal Summary
  --Originators: First Franklin (39.66%), New Century (34.74%),
    Option One (25.61%);

  --60+ day Delinquency: 34.01%;
  --Realized Losses to date (% of Original Balance): 0.21%;
  --Expected Remaining Losses (% of Current balance): 20.88%;
  --Cumulative Expected Losses (% of Original Balance): 11.27%.

HSI Asset Securitization Corporation Trust 2005-NC1
  --$34.7 million class I-A-1 affirmed at 'AAA',
    (BL: 65.75, LCR: 3.3);

  --$2.7 million class I-A-2 rated 'AAA', placed on Rating Watch
    Negative (BL: 37.74, LCR: 1.9);

  --$52.6 million class II-A-2 affirmed at 'AAA',
    (BL: 73.97, LCR: 3.72);

  --$25.2 million class II-A-3 affirmed at 'AAA',
    (BL: 61.82, LCR: 3.1);

  --$5.8 million class II-A-4 rated 'AAA', placed on Rating Watch
    Negative (BL: 37.74, LCR: 1.9);

  --$18.3 million class M-1 affirmed at 'AA+',
    (BL: 51.99, LCR: 2.61);

  --$13.3 million class M-2 affirmed at 'AA+',
    (BL: 46.16, LCR: 2.32);

  --$12.0 million class M-3 affirmed at 'AA',
    (BL: 39.46, LCR: 1.98);

  --$10.4 million class M-4 downgraded to 'A' from 'AA'
    (BL: 35.51, LCR: 1.78);

  --$9.5 million class M-5 downgraded to 'BBB' from 'AA-'
    (BL: 31.53, LCR: 1.58);

  --$8.2 million class M-6 downgraded to 'BB' from 'A'
    (BL: 27.76, LCR: 1.39);

  --$7.3 million class M-7 downgraded to 'B' from 'A-'
    (BL: 24.35, LCR: 1.22);

  --$3.8 million class M-8 downgraded to 'B' from 'BBB'
    (BL: 22.46, LCR: 1.13);

  --$3.2 million class M-9 downgraded to 'B' from 'BBB-'
    (BL: 20.83, LCR: 1.05);

  --$6.0 million class M-10 downgraded to 'CCC' from 'BB'
    (BL: 17.78, LCR: 0.89);

  --$4.4 million class M-11 downgraded to 'CCC' from 'B'
    (BL: 15.64, LCR: 0.79);

  --$5.1 million class M-12 downgraded to 'CC/DR5' from 'B'
    (BL: 13.25, LCR: 0.67);

  --$5.1 million class M-13 revised to 'C/DR6' from 'C/DR5',
    (BL: 10.98, LCR: 0.55).

Deal Summary
  --Originators: New Century Mortgage Corporation (100%);
  --60+ day Delinquency: 33.61%;
  --Realized Losses to date (% of Original Balance): 0.80%;
  --Expected Remaining Losses (% of Current balance): 19.91%;
  --Cumulative Expected Losses (% of Original Balance): 8.19%.

HSI Asset Securitization Corporation Trust 2005-NC2
  --$24.4 million class I-A affirmed at 'AAA',
    (BL: 78.77, LCR: 3.27);

  --$0.0 million class II-A-2 affirmed at 'AAA',
    (BL: 99.69, LCR: 4.14);

  --$29.4 million class II-A-3 affirmed at 'AAA',
    (BL: 74.54, LCR: 3.1);

  --$16.1 million class II-A-4 affirmed at 'AAA',
    (BL: 70.09, LCR: 2.91);

  --$16.9 million class M-1 affirmed at 'AA+',
    (BL: 59.82, LCR: 2.49);

  --$15.3 million class M-2 affirmed at 'AA',
    (BL: 50.49, LCR: 2.1);

  --$10.6 million class M-3 rated 'AA-', placed on Rating Watch
    Negative (BL: 41.92, LCR: 1.74);

  --$7.6 million class M-4 downgraded to 'BBB' from 'A+'
    (BL: 38.26, LCR: 1.59);

  --$7.4 million class M-5 downgraded to 'BB' from 'A'
    (BL: 34.16, LCR: 1.42);

  --$6.5 million class M-6 downgraded to 'BB' from 'A-'
    (BL: 30.20, LCR: 1.26);

  --$6.5 million class M-7 downgraded to 'B' from 'BBB'
    (BL: 26.00, LCR: 1.08);

  --$5.1 million class M-8 downgraded to 'CCC' from 'BB'
    (BL: 22.70, LCR: 0.94);

  --$3.5 million class M-9 downgraded to 'CCC' from 'BB'
    (BL: 20.40, LCR: 0.85);

  --$3.5 million class M-10 downgraded to 'CCC' from 'B'
    (BL: 18.13, LCR: 0.75);

  --$4.4 million class M-11 remains at 'C/DR5'
    (BL: 15.39, LCR: 0.64).

Deal Summary
  --Originators: New Century Mortgage Corporation (100%);
  --60+ day Delinquency: 43.76%;
  --Realized Losses to date (% of Original Balance): 0.83%;
  --Expected Remaining Losses (% of Current balance): 24.06%;
  --Cumulative Expected Losses (% of Original Balance): 9.54%.

HSI Asset Securitization Corporation Trust 2005-OPT1
  --$0.9 million class A-2 affirmed at 'AAA',
    (BL: 99.61, LCR: 5.29);

  --$113.8 million class A-3 affirmed at 'AAA',
    (BL: 48.56, LCR: 2.58);

  --$36.6 million class A-4 affirmed at 'AAA',
    (BL: 41.98, LCR: 2.23);

  --$33.5 million class M-1 downgraded to 'BBB' from 'AA+'
    (BL: 28.13, LCR: 1.49);

  --$16.6 million class M-2 downgraded to 'B' from 'AA'
    (BL: 20.38, LCR: 1.08);

  --$2.8 million class M-3 downgraded to 'B' from 'AA-'
    (BL: 19.04, LCR: 1.01);

  --$2.5 million class M-4 downgraded to 'CCC' from 'A+'
    (BL: 17.79, LCR: 0.95);

  --$2.5 million class M-5 downgraded to 'CCC' from 'A'
    (BL: 16.50, LCR: 0.88);

  --$7.6 million class M-6 downgraded to 'CC/DR6' from 'BBB+'
    (BL: 12.65, LCR: 0.67).

Deal Summary
  --Originators: Option One Mortgage Corporation (100%);
  --60+ day Delinquency: 30.64%;
  --Realized Losses to date (% of Original Balance): 0.43%;
  --Expected Remaining Losses (% of Current balance): 18.82%;
  --Cumulative Expected Losses (% of Original Balance): 8.63%.

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.


HUDBAY MINERALS: S&P Withdraws 'B+' Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B+' long-term
corporate credit rating on Winnipeg-based HudBay Minerals Inc. at
the issuer's request.  

The company has no rated debt obligations outstanding.


HUGHES NETWORK: S&P Changes Outlook to Stable; Retains 'B' Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Germantown, Maryland-based satellite services provider Hughes
Network Systems LLC to stable from negative.  At the same time,
S&P affirmed all ratings, including the 'B' corporate credit
rating.
     
Hughes is the leading provider of very small aperture terminal
satellite networking services to domestic and international
enterprises, small and midsize businesses, and consumers.
     
The outlook change reflects initiation of commercial operations of
SPACEWAY-3, the company's advanced satellite.
      
"As Hughes adds customers onto the SPACEWAY platform we expect the
company will begin reducing its need for leased transponder
capacity, which will lower its operating costs," said Standard &
Poor's credit analyst Naveen Sarma.  "As a result, EBITDA margins
should improve from the current 14% level, although we note that
the bulk of the savings will materialize in 2009," he said.
     
The ratings on Hughes reflect a highly leveraged financial
profile, especially when adjusted for operating and transponder
leases.  They also reflect uncertain long-term growth prospects
for the company's consumer and small business broadband service
because this service has fewer capabilities than faster cable and
telephone data services, which could limit growth as competitors
expand their service coverage.  Hughes could see significant
competitive pressure from WildBlue, and longer term, from ViaSat.
     
Tempering factors include Hughes' leading position in the VSAT
industry and a degree of revenue stability with sizeable revenue
backlog from three- to five-year contracts with large enterprise
customers.


JED OIL: December 31 Balance Sheet Upside-Down by $16 Million
-------------------------------------------------------------
JED Oil Inc.'s balance sheet at Dec. 31, 2007, showed total assets
of 79.615 million and total liabilities of $95.676 million,
resulting to total stockholder's deficiency of $16.061 million.

Jed Oil reported financial results for the fourth quarter and year
ended Dec. 31, 2007.  

Net income applicable to common stockholders in quarter ended
Dec. 31, 2007 was $1.137 million compared to net loss applicable
to common stockholders of $16.450 million for the same period in
the previous year.

For full year 2007, net income applicable to common stockholders
was $11.969 million compared to net loss applicable to common
stockholders of $77.558 million.

During the year ended Dec. 31, 2007, the company realized a
negative cash flow from operating activities of $0.503 million
compared to negative cash flow of $4.927 million in 2006.

At Dec. 31, 2007, JED had a consolidated working capital
deficiency of $48.996 million compared to$3.033 million at
Dec. 31, 2006.

The company's working capital deficiency and change in working
capital from the prior year are as a result of the Convertible
Notes Payable becoming current during the year.  The company
requires additional funds to maintain operations and discharge
liabilities as they become due.

The company related that these conditions raise substantial doubt
about its ability to continue as a going concern.  The gain on
sale of petroleum and natural gas properties and issues of common
shares relating to the purchase of Caribou Resources Corp. during
2007 has significantly reduced the stockholder's deficiency.  The
company settled a contract for drilling services during the year
ended Dec. 31, 2007, that resulted in a loss of $1.931 million and
a payment by the drilling contractor to JED Oil Inc. of an equal
amount in cash.

In 2007, the company substantially restructured its operations
through cost cutting, debt restructuring and the acquisition of a
large productive property that should have a positive impact on
the company's activities into 2008.  

                        Notes Restructuring

During the third quarter of 2007, JED's preferred shareholders
agreed to an extension of the redemption date of their shares from
Feb. 1, 2008, to Feb. 1, 2010, and have received a reduced
conversion price of $3.50 per share to acquire common shares over
that period.  The agreement reduces the company's current cash
requirement to redeem the preferred shares by $28.760 million
until 2010.  

Subsequent to the year end, the holders of the company's 10%
Senior Subordinated Convertible Notes have agreed to restructure
the Notes and provide for their redemption.  Under the terms of
the agreement, the company has until May 15, 2008, to complete the
credit facility offered by a Canadian Chartered Bank of
approximately $32 million.

Net proceeds from the loan facility will be used to repay
approximately $26 million of the outstanding notes plus accrued
interest, an extension fee, and to reduce the working capital
deficiency.  Notes in the amount of approximately $14 million will
be amended or replaced and an additional note in the amount of
$4 million will be issued for cash which will be applied to the
working capital deficiency.

These notes will pay interest quarterly at a rate of 12% per annum
and be convertible into common shares of JED at an exercise price
of $1.25 per share.  Approximately $11 million of the Notes will
have a maturity date of 1 year from the date of closing and Notes
totaling approximately $7 million will mature 2 years from the
closing date.

Due to the company's reported working capital deficiency, it will
require additional funds to maintain operations and discharge
liabilities as they become due.  While these conditions raise
substantial doubt about the company's ability to continue as a
going concern, the restructuring of the Notes has been designed to
mitigate this risk.

                           About JED Oil

Headquartered in Didsbury, Alberta, JED Oil Inc. (AMEX: JDO) --
http://www.jedoil.com/-- is an oil and natural gas company that     
commenced operations in the second quarter of 2004 and has begun
to develop and operate oil and natural gas properties principally
in western Canada and the United States.


JHT HOLDINGS: S&P Withdraws 'CCC+' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'CCC+' corporate
credit rating on Kenosha, Wisconsin-based JHT Holdings Inc.
     
Standard & Poor's had placed the ratings on JHT Holdings on
CreditWatch with negative implications on Sept. 12, 2007, in
response to the company's weak operating performance in the first
half of 2007.  Standard & Poor's subsequently downgraded JHT
Holdings to a 'CCC+' rating following breach of the total leverage
and minimum EBITDA covenants on its senior credit facility as of
third quarter ended Sept. 30, 2007.  

JHT Holdings has since obtained a waiver and amendment from its
lenders which includes an equity infusion from its sponsor, but
the company still faces difficult market conditions.  Privately
held JHT Holdings does not release financials publicly.  No
further information is available from the company at this time.


KIMBALL HILL: Lenders' Waiver Agreement Further Extended to May 9
-----------------------------------------------------------------
Kimball Hill Homes further extended the existing waiver agreement
with its lender group through May 9, 2008.  The waiver agreement
was previously set to expire on April 11, 2008.

During this 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," said Kenneth Love, Chief
Executive Officer.  "During this period, we 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.


LAM RESEARCH: S&P Changes Watch Posting of BB- Rating to Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its CreditWatch
implications on the 'BB-' corporate credit rating on Lam Research
Corp. to CreditWatch positive from CreditWatch negative.
     
The revision to CreditWatch positive reflects the company's stable
operating performance during recent periods and cumulative net
adjustments, which did not materially affect its financial profile
or liquidity, which are strong for the rating.  Fremont,
California-based Lam Research recently filed financial statements
for its fiscal year ended June 2007, as well as for the first and
second quarters of 2008.
     
The rating was initially placed on CreditWatch with negative
implications on Aug. 27, 2007, following the company's
announcement that it would be unable to file its 2007 form 10-K on
time.  The delay was caused by a review of the company's
historical stock option practices.
     
As of Dec. 23, 2007, on a trailing-12-month basis, Lam generated
revenues of $2.6 billion and EBITDA of about $800 million,
resulting in adjusted leverage of less than 0.5x.  Cash and cash
investments in the same period totaled about $1.3 billion.  
However, on March 11, 2008, the company completed its tender offer
for Zurich, Switzerland-based SEZ Holding AG for about $584
million in cash.  Additionally, the December quarter experienced
some relative weakness, reflecting less spending by chip
manufacturers, resulting from expectations for a general economic
slowdown and overcapacity issues.
     
"We will meet with management to assess Lam's business strategy,
financial policy, and business prospects, given the current
operating environment," said Standard & Poor's credit analyst
Joseph Spence.


LB-UBS COMMERCIAL: S&P Low-B Initial Ratings on Six Cert. Classes
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to LB-UBS Commercial Mortgage Trust 2008-C1's
$1.0071 billion commercial mortgage pass-through certificates
series 2008-C1.
     
The preliminary ratings are based on information as of April 11,
2008.  Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
     
The preliminary ratings reflect the 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 composition of the loans.  Classes A-1, A-AB, A-
2, A-M, and A-J 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 1.35x, a beginning
loan-to-value ratio of 98.7%, and an ending LTV of 83.1%.
    
                   Preliminary Ratings Assigned
            LB-UBS Commercial Mortgage Trust 2008-C1
   
                                                  Recommended
   Class        Rating        Amount              credit support
   -----        ------        ------              --------------
   A-1          AAA           $47,990,000          30.000
   A-AB         AAA           $50,023,000          30.000
   A-2          AAA          $606,964,000          30.000
   A-M          AAA          $100,711,000          20.000
   A-J          AAA           $69,239,000          13.125
   A-2FL(1)     AAA                  TBD           30.000
   A-MFL(1)     AAA                  TBD           20.000
   A-JFL(1)     AAA                  TBD           13.125
   X(2)         AAA        $1,007,111,098             N/A
   B            AA+           $13,848,000          11.750
   C            AA            $11,330,000          10.625
   D            AA-            $7,553,000           9.875
   E            A+             $8,813,000           9.000
   F            A              $7,553,000           8.250
   G            A-            $11,330,000           7.125
   H            BBB+          $11,330,000           6.000
   J            BBB           $12,589,000           4.750
   K            BBB-           $8,812,000           3.875
   L            BB+            $8,812,000           3.000
   M            BB             $5,036,000           2.500
   N            BB-            $2,518,000           2.250
   P            B+             $1,258,000           2.125
   Q            B              $2,518,000           1.875
   S            B-             $2,518,000           1.625
   T            NR            $16,366,098             N/A
    
                   (1) Floating-rate class.
          (2) Interest-only class with a notional amount.
                   TBD -- To be determined.
                    N/A -- Not applicable.
                       NR -- Not rated.


LBI MEDIA: S&P Revises Outlook to Stable; Confirms 'B' Rating
-------------------------------------------------------------
Standard & Poor's Rating Services revised its outlook on LBI Media
Inc. to stable from positive.  S&P also affirmed the 'B' corporate
credit rating on the company.  The Burbank, California-based
company had $423 million of total debt outstanding as of Dec. 31,
2007.
      
"The outlook revision reflects our expectation that leverage will
remain high over the near term," said Standard & Poor's credit
analyst Michael Altberg, "due to the company's acquisitive growth
strategy and challenging radio and TV advertising demand in 2008."   

Further concerns include the onset of cash interest payments on
the company's 11% discount notes which begin to accrue on Oct. 15,
2008.  The company had previously intended to refinance these
notes prior to the onset of cash interest payments.  

"However," added Mr. Altberg, "we believe the current tight credit
environment places increased uncertainty around the company's
plans to address these notes."


LE-NATURE'S: Court Approves Second Amended Disclosure Statement
---------------------------------------------------------------
The United States Bankruptcy Court for the Western District of
Pennsylvania approved Le-Nature's Inc. and its debtor-affiliates'
Second Amended Disclosure Statement describing their Second
Amended Joint Chapter 11 Plan of Liquidation.

                      Treatment of Claims

As previously reported in the Troubled Company Reporter, under
the Plan, the Debtors intend to pay in full administrative and
unclassified fee claims.  Priority tax claims will either be
paid in full or in equal annual installments, plus 6% interest per
annum.

Class 1 claims, or lenders secured claims, will be paid in full in
exchange for:

   (a) tier one trust beneficial interests in a percentage
       ratable to other holders in class 1;

   (b) additional tier one trust beneficial interests in a
       percentage ratable to other holders in class 1 as a
       result of the disallowance of any disputed claim; and

   (c) all proceeds distributed under the plan and the
       liquidation trust agreement.

Class 2, or other secured claims, will be paid in full in exchange
for, at the option of the liquidation trust, one or a combination
of:

   (a) payment in cash from proceeds of sale of collateral
       securing allowed class 2 claims;

   (b) surrender of the collateral securing the allowed
       class 2 claims; or

   (c) other distributions that satisfy requirements of
       Bankruptcy Code Section 1129.

Class 3, or priority non-tax claims, will be paid in full in cash
at the later of: (a) the effective date of the Plan; (b) the date
the claim becomes an allowed claim or otherwise becomes payable
under the plan; or (c) as soon as reasonably practicable.

Class 4A, or lenders unsecured claims, will receive:

   (a) tier two trust beneficial interests in percentage ratable
       to other holders of allowed claims in class4A, class 4B,
       and class4C;

   (b) additional tier two trust beneficial interests in
       percentage ratable to other holders of allowed claims in
       class 4A, B, and C as a result of disallowance of disputed
       claim in class 4A, B and C;

   (c) additional tier two trust beneficial interests in
       percentage ratable to other holders of allowed claims in
       class4A, B, and C as a result of turnover enforcement of
       class 4C distributions;

   (d) proceeds of the foregoing distributed pursuant to the terms
       of the plan and the liquidation trust agreement; and

   (e) a percentage of the proceeds of the Tea Systems
       International LLC/Holdings Property to other holders of
       claims in class 4A and 4C, subject to:

       (i) use of proceeds to fund the initial trust funding or
           liquidation trust reserve; and

      (ii) reallocation of proceeds to holders of allowed claims
           in class 4A, B and C.

Class 4B, or general unsecured claims, will receive:

   (a) tier two trust beneficial interests in a percentage ratable
       to other holders of allowed claims in class 4A, B and C;

   (b) additional tier two trust beneficial interests in a
       percentage ratable to other holders of allowed claims in
       class 4A, B and C, as a result of the disallowance of
       disputed claim in class 4A, B and C;

   (c) distributed pursuant to terms of the plan and the
       liquidation trust agreement; and

   (d) a percentage of the proceeds of the TSI/Holdings Property
       ratable to other holders of allowed claims in class 4A, B
       and C, but only to the extent that:

       (i) the proceeds are not used to fund the initial trust
           funding or the liquidation trust reserve; and

      (ii) the proceeds are reallocated to holders of allowed
           claims in class 4A, B and C.

Class 4C, or unsecured senior subordinated notes claims, will
receive:

   (a) tier two trust beneficial interests in a percentage ratable
       to other holders of allowed claims in class 4A, B and C;

   (b) additional tier two trust beneficial interests in a
       percentage ratable to other holders of allowed claims in
       class 4A, B and C, as a result of the disallowance of
       disputed claim in class 4A, B and C;

   (c) distributed pursuant to terms of the plan and the
       liquidation trust agreement; and

   (d) a percentage of the proceeds of the TSI/Holdings Property
       ratable to other holders of allowed claims in class 4A, B
       and C, subject to:

       (i) use of proceeds to fund the initial trust funding or
           liquidation trust reserve; and

      (ii) reallocation of proceeds to holders of allowed claims
           in class 4A, B and C, provided however, that certain
           distributions will be deemed reallocated and
           distributed on account claims in class 4A, as a
           settlement of potential claims by lenders for
           enforcement of contractual subordination provisions in
           the senior subordinated notes indenture, in accordance
           with a turnover enforcement.

Class 5, or subordinated litigation claims, will receive: (a) tier
three trust beneficial interest in a percentage ratable to other
allowed claims in class 5; (b) additional tier three trust
beneficial interest as a result of the disallowance of disputed
claim in class 5; and (c) proceeds distributed to the terms of the
plan and the liquidation trust agreement.

Class 6, or interest, will receive: (a) tier four trust beneficial
interests in a percentage ratable to other allowed interests in
class 6; (b) additional tier four trust beneficial interests as a
result of the disallowance of disputed claims in class 6; and (c)
proceeds distributed pursuant to the terms of the plan and the
liquidation trust agreement.

Other than class 3, or priority non-tax claims, all classes of
claims and interests are entitled to vote for the rejection or
acceptance of the Debtors' second amended plan of liquidation.

                      About Le-Nature's Inc.

Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. --
http://www.le-natures.com/-- makes bottled waters, teas, juices
and nutritional drinks.  Its brands include Kettle Brewed Ice
Teas, Dazzler fruit juice drinks and lemonade, and AquaAde
vitamin-enriched water.

Four unsecured creditors of Le-Nature's filed an involuntary
chapter 7 petition against the company on Nov. 1, 2006 (Bankr.
W.D. Pa. Case No. 06-25454).  On Nov. 6, 2006, two of Le-Nature's
subsidiaries, Le-Nature's Holdings Inc., and Tea Systems
International Inc., filed voluntary petitions for relief under
chapter 11 of the Bankruptcy Code.  Judge McCullough converted Le
Nature's Inc.'s case to a chapter 11 proceeding.  The Debtors'
cases are jointly administered.  The Debtors' schedules filed with
the Court showed $40 million in total assets and $450 million in
total liabilities.

Douglas Anthony Campbell, Esq., Ronald B. Roteman, Esq., and
Stanley Edward Levine, Esq., at Campbell & Levine, LLC, represents
the Debtors in their restructuring efforts.  The Court appointed
R. Todd Neilson as Chapter 11 Trustee.  Dean Z. Ziehl, Esq.,
Richard M. Pachulski, Esq., Stan Goldich, Esq., Ilan D. Scharf,
Esq., and Debra Grassgreen, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub LLP, represent the Chapter 11 Trustee.
David K. Rudov, Esq., at Rudov & Stein, and S. Jason Teele, Esq.,
and Thomas A. Pitta, Esq. at Lowenstein Sandler PC, represent the
Official Committee of Unsecured Creditors.  Edward S. Weisfelner,
Esq., Robert J. Stark, Esq., and Andrew Dash, Esq., at Brown
Rudnick Berlack Israels LLP, and James G. McLean, Esq., at Manion
McDonough & Lucas represent the Ad Hoc Committee of Secured
Lenders.  Thomas Moers Mayer, Esq., and Matthew J. Williams, Esq.
at Kramer Levin Naftalis & Frankel LLP, represent the Ad Hoc
Committee of Senior Subordinated Noteholders.


LE-NATURE'S: Amended Plan Confirmation Hearing Set on June 9
------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
will convene a hearing on June 9, 2008, to consider confirmation
of Le-Nature's Inc. and its debtor-affiliates' Second Amended
Joint Chapter 11 Plan of Liquidation, Bloomberg News reports,
citing court documents.

                      About Le-Nature's Inc.

Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. --
http://www.le-natures.com/-- makes bottled waters, teas, juices
and nutritional drinks.  Its brands include Kettle Brewed Ice
Teas, Dazzler fruit juice drinks and lemonade, and AquaAde
vitamin-enriched water.

Four unsecured creditors of Le-Nature's filed an involuntary
chapter 7 petition against the company on Nov. 1, 2006 (Bankr.
W.D. Pa. Case No. 06-25454).  On Nov. 6, 2006, two of Le-Nature's
subsidiaries, Le-Nature's Holdings Inc., and Tea Systems
International Inc., filed voluntary petitions for relief under
chapter 11 of the Bankruptcy Code.  Judge McCullough converted Le
Nature's Inc.'s case to a chapter 11 proceeding.  The Debtors'
cases are jointly administered.  The Debtors' schedules filed with
the Court showed $40 million in total assets and $450 million in
total liabilities.

Douglas Anthony Campbell, Esq., Ronald B. Roteman, Esq., and
Stanley Edward Levine, Esq., at Campbell & Levine, LLC, represents
the Debtors in their restructuring efforts.  The Court appointed
R. Todd Neilson as Chapter 11 Trustee.  Dean Z. Ziehl, Esq.,
Richard M. Pachulski, Esq., Stan Goldich, Esq., Ilan D. Scharf,
Esq., and Debra Grassgreen, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub LLP, represent the Chapter 11 Trustee.
David K. Rudov, Esq., at Rudov & Stein, and S. Jason Teele, Esq.,
and Thomas A. Pitta, Esq. at Lowenstein Sandler PC, represent the
Official Committee of Unsecured Creditors.  Edward S. Weisfelner,
Esq., Robert J. Stark, Esq., and Andrew Dash, Esq., at Brown
Rudnick Berlack Israels LLP, and James G. McLean, Esq., at Manion
McDonough & Lucas represent the Ad Hoc Committee of Secured
Lenders.  Thomas Moers Mayer, Esq., and Matthew J. Williams, Esq.
at Kramer Levin Naftalis & Frankel LLP, represent the Ad Hoc
Committee of Senior Subordinated Noteholders.


LENNAR CORP: Posts $88MM Net Loss in Quarter Ended February 29
--------------------------------------------------------------
Lennar Corporation reported results for its first quarter ended
Feb. 29, 2008.  First quarter net loss in 2008 was $88.2 million
compared to first quarter net earnings of $68.6 million in 2007.

"Market conditions have remained challenged and continued to
deteriorate throughout our first quarter of 2008," Stuart Miller,
president and chief executive officer of Lennar Corporation, said.
"The housing industry continues to be impacted by an unfavorable
supply and demand relationship, which restricts the volume of new
home sales and, concurrently, depresses home prices in most
markets across the country."

"Concurrently, lower consumer confidence has quieted demand among
prospective homebuyers and deterred them from a buying decision,
while contraction in the lending markets has reduced the
availability of credit for those prospective homebuyers that do
wish to buy a home."

"Our first quarter results reflect the fact that our balance sheet
has been and continues to be our top priority," Mr. Miller
continued.  "With most of the significant work on asset impairment
behind us, throughout our first quarter we have remained focused
on the delivery of our backlog, curtailing land purchases where
possible, restructuring our joint ventures where necessary, and
right-sizing our operations in order to protect cash, preserve
value and fortify our balance sheet."

             Financial Condition and Capital Resources

At Feb. 29, 2008, the company has cash related to its homebuilding
and financial services operations of $1.2 billion, compared to
$463.9 million at Feb. 28, 2007.

In the three months ended Feb. 29, 2008, cash flows provided by
operating activities amounted to $844.5 million, compared to cash
used by operating activities of $501.1 million in the same period
last year.

During the three months ended Feb. 29, 2008, cash flows provided
by operating activities were positively impacted by the receipt of
a cash tax refund of $852 million generated by losses incurred
prior to fiscal 2008.  Throughout the first quarter of fiscal
2008, it remained focused on the delivery of its backlog,
curtailing land purchases, restructuring its joint ventures when
necessary, and right-sizing its operations in order to protect
cash, preserve value and fortify its balance sheet.

Cash flows used in investing activities totaled $130.6 million in
the three months ended Feb. 29, 2008, compared to cash flows
provided by investing activities of $481.7 million in the same
period last year.

In the three months ended Feb. 29, 2008, the company contributed
$172.1 million of cash to unconsolidated entities, compared to
$178.0 million in the same period last year.  Its investing
activities also included distributions of capital from
unconsolidated entities during the three months ended Feb. 29,
2008, and Feb. 28, 2007, of $43.8 million and $294.7 million.

During the three months ended Feb. 28, 2007, the company also
received a $354.6 million distribution in excess of its investment
in the LandSource unconsolidated entity due to its
recapitalization in 2007.

At Feb. 29, 2008, the company's balance sheet showed total assets
of $8.515 billion, total liabilities 4.835 billion and total
stockholders' equity of $3.680 billion.

                       About Lennar Corp.

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

                          *     *     *

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

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


LINEN 'N THINGS: Weak Operating Margin Prompts Moody's Caa2 Rating
------------------------------------------------------------------
Moody's Investors Service downgraded Linens 'N Things, Inc.'s
ratings, probability of default rating to Caa2, and placed the
ratings on review for further possible downgrade.  Moody's also
affirmed Linens' speculative grade liquidity rating of SGL-4.

The downgrade in Linens' PDR is prompted by Linens' weaker-than-
expected operating margin in the fourth quarter, as well as by
evidence that the already challenged "home goods" sales
environment has recently worsened.  This is evidenced by the
recent announcement by industry leader Bed, Bath, and Beyond which
yesterday guided its fiscal 2008 earnings per share downward.  As
a result Moody's expects that Linens 'N Things will be challenged
to stem its current level of operating losses and free cash flow
drain, thus placing further strain on the company's already weak
liquidity position and increasing the probability of default.  The
review for possible downgrade reflects Moody's concern that the
weak "home goods" sector selling environment could potentially
cause the company to lose its current level of support by trade
creditors.

These ratings are downgraded and placed on review for further
possible downgrade:

  -- Corporate family rating to Caa2 from Caa1;
  -- Probability of default rating to Caa2 from Caa1;
  -- $650 million of senior secured guaranteed notes due 2014 to
     Caa3 from Caa2.

These rating is affirmed:

  -- Speculative Grade Liquidity Rating at SGL-4.

The LGD Assessment of the $650 million senior secured guaranteed
notes (LGD4, 64%) is subject to change.

The Caa2 PDR rating reflects Moody's expectation that Linens'
sales and earnings in 2008 will be further challenged which will
result in a precarious liquidity position, exceptionally weak
credit metrics, and increased likelihood of a payment default on
or distressed exchange of its debt obligations.  Based upon
Moody's expectations for a continuation in free cash flow
deficits, the company will likely need to continue to make sizable
drawings under its revolving credit facility over the next twelve
months.  This could potentially consume the majority of the
company's remaining committed external liquidity.  

This weakened liquidity greatly diminishes the company's financial
flexibility to withstand even minimal further weakening in its
earnings or cash flow caused by the already challenged retail
sales environment.  This tenuous liquidity position is justifies
the affirmation of Linens' SGL-4 speculative grade liquidity
rating. Given the company's weak operating performance as well as
challenges in the bank and broader financial markets, Linens 'N
Things could have difficulty obtaining additional financing, if
needed.  

In addition, the rating reflects the company's weak competitive
position in the highly competitive home furnishings market, its
negative EBITA margins during fiscal year 2007, and its history of
mis-positioned offerings.

Moody's review will focus on the company's operating performance
-- particularly its level of free cash flow deficit, the ongoing
level of support by its trade creditors, and its borrowing base
availability.  In addition, the review will focus on the overall
retail selling environment of the home goods sector.

Linens N Things Inc., headquartered in Clifton, New Jersey, is a
nationwide specialty retailer of home textiles, housewares, and
home accessories that operates approximately 589 stores in 47
states and seven Canadian provinces. Revenues for the lagging
twelve month period ended December 29, 2007 were approximately
$2.8 billion.


MAIR HOLDINGS: Big Sky Unit Gets Default Notice from Mesa Air
-------------------------------------------------------------
On April 7, 2008, Big Sky Transportation Co., a wholly owned
subsidiary of MAIR Holdings Inc., received a notice of default and
demand for payment from Mesa Airlines Inc.

In the notice, Mesa asserted that Big Sky is in default of its
lease agreements for ten aircraft.  Mesa's notice of default
requested payment by Big Sky of about $4.8 million.

Although Big Sky ceased operating flights on March 8, 2008, Big
Sky has continued to make all lease payments due to Mesa.  
According to Big Sky's estimate, the aggregate amount remaining
due under the leases for the ten aircraft is about $4.1 million.

The default notice further advised of Mesa's intent to draw on the
$1.9 million letter of credit that the company established for
Mesa's benefit in 2005.  The LOC was established in exchange for
cancelling the company's guaranty of Big Sky's obligations with
respect to the aircraft leases.

In response to Mesa's notice of default and attempted draw on the
LOC, on April 8, 2008, the company and Big Sky jointly filed a
complaint against Mesa in federal court in the District of Montana
asserting that Mesa has not suffered any financial damages and
that Mesa improperly refused to mitigate its damages under the
leases.

The complaint requests, among other things, that funds Mesa draws
on the LOC be placed in a constructive trust until the court
determines the proper amount of damages, if any, to be awarded to
Mesa.

                       Big Sky Liquidation

As reported in the Troubled Company Reporter on March 17, 2008,
Big Sky Airlines ceased all operations effective at midnight on
March 8, 2008.  MAIR said in a filing with the Securities and
Exchange Commission that this decision followed Big Sky's December
2007 announcement that it was ceasing its eastern United States
operations and would be attempting to transition its services in
the west to another carrier.  However, the company concluded that
it is not feasible to continue operating Big Sky at a loss until
another carrier can begin servicing Big Sky's routes.  The company
is now focused on liquidating Big Sky's assets and minimizing its
subsidiary's liabilities.

In addition, the company's board of directors has directed the
company's management to prepare a plan of liquidation to present
to the company's shareholders, with the continuing goal of
returning cash to them.  Management expects to file the plan of
liquidation with the SEC in early May 2008.

                        About Mesa Airlines

Mesa Air Group Inc., dba Mesa Airlines Inc., (NASDAQ: MESA) --
http://www.mesa-air.com/--  is a holding company whose principal  
subsidiaries operate as regional air carriers providing scheduled
passenger and airfreight service.  As of Sept. 30, 2007, the
company served 184 cities in 45 states, the District of Columbia,
Canada, the Bahamas and Mexico and operated a fleet of 182
aircraft with approximately 1,100 daily departures.  Approximately
98% of Mesa's consolidated passenger revenues from continuing
operations for the fiscal year ended Sept. 30, 2007 (fiscal 2007),
were derived from operations associated with code-share
agreements.  Its subsidiaries have code-share agreements with
Delta Air Lines Inc., Midwest Airlines Inc., United Airlines Inc.
and America West Airlines Inc., which operates as Unites States
Airways and is referred as US Airways.  The remaining passenger
revenues from continuing operations are derived from its
independent go! operations in Hawaii.

                        About MAIR Holdings

Minneapolis-based MAIR Holdings Inc. (NasdaqNM: MAIR) --
http://www.mairholdings.com/-- is the holding company for Big Sky
Transportaion Co, dba Big Sky Airlines --
http://www.bigskyair.com/-- a regional air carrier based in
Billings, Montana.  Big Sky has codeshare agreements with
Northwest Airlines, Alaska Airlines, Horizon Air and US Air which
allows customers the convenience of traveling with one ticket,
through baggage checking and economical through fares, to
destinations throughout the world.  Big Sky provides air service
under the Essential Air Service program administered by the
Department of Transportation.

As of March 31, 2007, MAIR was also the holding company for Mesaba
Aviation Inc.

Headquartered in Eagan, Minnesota, Mesaba Aviation, Inc., dba
Mesaba Airlines -- http://www.mesaba.com/-- operates as a
Northwest Airlink affiliate under code-sharing agreements with
Northwest Airlines.  The Company filed for chapter 11 protection
on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  When the
Debtor filed for protection from its creditors, it listed total
assets of $108,540,000 and total debts of $87,000,000.  Mesaba
exited bankruptcy on April 24, 2007, and was later acquired by
Northwest Airlines.


MANITOWOC COMPANY: To Acquire Enodis In Deal Valued at $2.1 Bil.
----------------------------------------------------------------
The Manitowoc Company Inc. reported that an agreement has been
reached on the terms of a recommended acquisition of Enodis Plc in
a transaction valued at approximately $2.1 billion, including the
assumption of Enodis' net debt of approximately $207 million as of
Sept. 29, 2007.
    
The transaction, which was unanimously approved by both companies'
boards of directors, provides for a cash payment of 258 pence per
Enodis share.  In addition, in advance of the closing of the
transaction, Enodis will pay a dividend of 2 pence per Enodis
share in lieu of an interim dividend in respect of the financial
year ending Sept. 30, 2008.  The transaction is structured as a
court-sanctioned scheme of arrangement under the laws of the U.K.
and is expected to close in the fourth quarter of 2008.  The
transaction is subject to court approval in the U.K., the approval
of Enodis shareholders, as well as regulatory approvals in various
jurisdictions.
    
Listed in London and operationally headquartered in Tampa,
Florida, Enodis, a global leader in commercial foodservice
equipment with a variety of premier brands, reported revenues of
0.8 billion GBP ($1.6 billion) in the financial year ended
Sept. 29, 2007.  Enodis supplies foodservice equipment, with
products on the "cold" and "hot" sides of the industry.  To date,
Manitowoc Foodservice's focus has been on "cold" equipment.  A
combination with Enodis will allow Manitowoc to enter two major
new market segments, hot foodservice and food retail equipment, as
well as expand its cold-side businesses.
    
"We have long recognized the value that a combination of the
foodservice businesses of Enodis and Manitowoc would create," Glen
E. Tellock, Manitowoc president and chief executive officer said.
"We believe the strategic benefits of the combination are
substantial, and we are pleased to have reached an agreement for
this transforming acquisition."
    
"We believe the offer price provides good value to Enodis'
shareholders while also allowing Manitowoc's shareholders to
realize the benefits that the enhanced global business platform is
expected to generate through deeper customer relationships, a more
robust R&D process, and operating synergies," Mr. Tellock
explained.
    
Manitowoc believes that the successful integration of the two
businesses will result in improved growth prospects and the
opportunity to deliver significant synergies.  Management
currently estimates that by 2010 the transaction will generate
annual synergies of more than $60 million.  Historical revenues
for the combined companies for the most recently completed
respective financial years exceeded $5.6 billion.
    
"We believe the expanded global footprint of the combined
businesses creates an outstanding growth platform for Manitowoc
Foodservice," said Michael Kachmer, president of Manitowoc
Foodservice.  "With the world's largest foodservice companies
growing at rates well in excess of the overall industry, we should
be well-positioned to partner with our customers in creating
modern, efficient kitchens that deliver the dining choices that
consumers want."
    
"The acquisition of Enodis provides the opportunity to replicate
the tremendous growth strategy that we employed in the lifting
industry," Mr. Tellock added.  "The same elements are in place for
this strategy to succeed again - industry leading brands, a global
footprint to meet the specific needs of a global customer base, a
commitment to technology, new produce development and world-class
aftermarket services, all supported by a team of the industry's
most talented people."

                 About The Manitowoc Company Inc.

Headquartered in Maniwotoc, Wisconsin, The Manitowoc Company Inc.
(NYSE: MTW) -- http://www.manitowoc.com/-- provides lifting    
equipment for the global construction industry, including lattice-
boom cranes, tower cranes, mobile telescopic cranes, and boom
trucks.  As a leading manufacturer of ice-cube machines,
ice/beverage dispensers, and commercial refrigeration equipment,
the company offers the broadest line of cold-focused equipment in
the foodservice industry.  In addition, the company is a provider
of shipbuilding, ship repair, and conversion services for
government, military, and commercial customers throughout the
maritime industry.

                         *     *     *

Moody's Investor Service placed The Manitowoc Company Inc.'s long-
term corporate family and probability of default ratings at 'Ba2'
in June 2007.  The ratings still hold to date with a stable
outlook.


MCDERMOTT SA: Fifth Amendment on Facility Won't Change S&P Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services said that its issue rating and
recovery rating on McDermott S.A. remain unchanged following the
company's announcement that it entered into a fifth amendment to
increase the size of its senior secured credit facility to
$800 million from $500 million.

S&P's issue rating on this debt is 'BB' with a recovery rating of
'3', indicating our expectation of meaningful (50% to 70%)
recovery in the event of a payment default.  The facility matures
on June 6, 2011, and credit capacity may be used for the issuance
of lines of credit and revolving debt.  As of Dec. 31, 2007,
McDermott (J. Ray) had no borrowings and $279 million in
performance LOCs issued under the facility.
     
McDermott (J. Ray) is a wholly owned subsidiary of McDermott
International Inc. (BB/Stable/--) and is engaged in the
engineering, fabrication and installation of offshore drilling and
production facilities, as well as marine pipelines and subsea
production facilities.
  
                       Ratings Unchanged

                     McDermott (J. Ray) S.A.

           Corporate credit rating           BB/Stable/--  
           $800 mil sr secd ln due 2011      BB            
             Recovery rating                 3


MERRILL LYNCH: Fitch Downgrades Ratings on $134.1MM Certificates
----------------------------------------------------------------
Fitch Ratings has taken rating actions on three Merrill Lynch
Mortgage Investors mortgage pass-through certificate transactions.  
Unless stated otherwise, any bonds that were previously placed on
Rating Watch Negative are removed.  Affirmations total
$352.3 million and downgrades total $134.1 million.  Additionally,
$74.3 million was placed on Rating Watch Negative.  Break Loss
percentages and Loss Coverage Ratios for each class are included
with the rating actions as:

Series 2005-HE1
  -- $10.7 million class A-1B affirmed at 'AAA',
     (BL: 75.70, LCR: 5.55);

  -- $15.9 million class A-2C affirmed at 'AAA',
     (BL: 73.84, LCR: 5.42);

  -- $21.9 million class M-1 rated 'AA', placed on Rating Watch
     Negative (BL: 46.31, LCR: 3.40);

  -- $16.1 million class M-2 downgraded to 'B' from 'A'
     (BL: 14.05, LCR: 1.03);

  -- $2.5 million class M-3 downgraded to 'CCC' from 'A-'
     (BL: 12.76, LCR: 0.94);

  -- $2.5 million class B-1 downgraded to 'CCC' from 'BBB+'
     (BL: 11.47, LCR: 0.84);

  -- $2.1 million class B-2 downgraded to 'CCC' from 'BBB'
     (BL: 10.54, LCR: 0.77);

  -- $2.1 million class B-3 downgraded to 'CC/DR4' from 'BBB-'
     (BL: 9.65, LCR: 0.71);

  -- $2.1 million class B-4 downgraded to 'CC/DR4' from 'BB+'
     (BL: 9.40, LCR: 0.69);

  -- $3.1 million class B-5 downgraded to 'CC/DR4' from 'B+'
     (BL: 8.22, LCR: 0.60).

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 25.82%;
  -- Realized Losses to date (% of Original Balance): 0.96%;
  -- Expected Remaining Losses (% of Current Balance): 13.63%;
  -- Cumulative Expected Losses (% of Original Balance): 3.56%.

Series 2005-HE2
  -- $55.6 million class A-1A affirmed at 'AAA',
     (BL: 62.80, LCR: 2.87);

  -- $13.9 million class A-1B affirmed at 'AAA',
     (BL: 58.75, LCR: 2.68);

  -- $63.3 million class A-2B affirmed at 'AAA',
     (BL: 62.30, LCR: 2.85);

  -- $21.1 million class A-2C affirmed at 'AAA',
     (BL: 57.79, LCR: 2.64).

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 36.45%;
  -- Realized Losses to date (% of Original Balance): 1.73%;
  -- Expected Remaining Losses (% of Current Balance): 21.88%;
  -- Cumulative Expected Losses (% of Original Balance): 10.48%.

Series 2005-HE3
  -- $100.1 million class A-1A affirmed at 'AAA',
     (BL: 55.96, LCR: 2.18);

  -- $25.0 million class A-1B rated 'AAA', placed on Rating Watch
     Negative (BL: 47.32, LCR: 1.85);

  -- $71.7 million class A-2B affirmed at 'AAA',
     (BL: 59.15, LCR: 2.31);

  -- $27.3 million class A-2C rated 'AAA', placed on Rating Watch
     Negative (BL: 46.82, LCR: 1.83);

  -- $41.5 million class M-1 downgraded to 'BB' from 'AA+'
     (BL: 34.84, LCR: 1.36);

  -- $28.1 million class M-2 downgraded to 'B' from 'A+'
     (BL: 27.01, LCR: 1.05);

  -- $9.1 million class M-3 downgraded to 'CCC' from 'A'
     (BL: 24.45, LCR: 0.95);

  -- $9.5 million class M-4 downgraded to 'CCC' from 'BBB+'
     (BL: 21.75, LCR: 0.85);

  -- $9.5 million class M-5 downgraded to 'CC/DR5' from 'BBB-'
     (BL: 19.02, LCR: 0.74);

  -- $6.0 million class M-6 downgraded to 'CC/DR6' from 'BB'
     (BL: 17.34, LCR: 0.68).

Deal Summary
  -- Originators: Ameriquest Mortgage Co. (70.18%) and Option One
     Mortgage Co. (29.82%);

  -- 60+ day Delinquency: 41.27%;
  -- Realized Losses to date (% of Original Balance): 1.36%;
  -- Expected Remaining Losses (% of Current Balance): 25.62%;
  -- Cumulative Expected Losses (% of Original Balance): 11.97%.

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 2005 with regard to continued poor loan performance and
home price weakness.


MS LLC: Case Summary & 17 Largest Unsecured Creditors
-----------------------------------------------------
Lead Debtor: M.S., LLC
             aka Crossroads Apartment Site
             1105 Quail Street
             Newport Beach, CA 92660

Bankruptcy Case No.: 08-11748

Debtor-affiliate filing separate Chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
        Murrieta 180 Apartments, LP                08-11749

Chapter 11 Petition Date: April 8, 2008

Court: Central District Of California (Santa Ana)

Judge: Robert N. Kwan

Debtors' Counsel: Paul J. Couchot, Esq.
                     (jmartinez@winthropcouchot.com)
                  Winthrop Couchot, PC
                  660 Newport Center Drive, Suite 400
                  Newport Beach, CA 92660
                  Tel: (949) 720-4100
                  Fax: (949) 720-4111
                  http://www.winthropcouchot.com/

M.S., LLC's Financial Condition:

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

A. M.S., LLC's Three Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Rick Engineering Co.           trade debt            $10,205
1223 University Avenue,
Suite 240
Riverside, CA 92507

Salisbury Law Group            legal services        $6,879
1600 Dove
Newport Beach, CA 92660

Steven C. Kiser                legal services        $1,089
240 Newport Center Drive,
Suite 210
Newport Beach, CA 92660

B. Murrieta 180 Apartments, LP's 14 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Palmeri, Tyler, Weiner &       legal services        $24,535
Wilhelm, LLP
Attn: Bob Ihrke
2603 Main Street, East Tower,
Suite 1300
Irvine, CA 92614
Tel: (949) 851-7265

KTGY Group, Inc.               trade debt            $12,694
Attn: Manny Gonzales
17992 Mitchell South
Irvine, CA 92867
Tel: (949) 851-2133

ADKAN Engineers, Inc.          trade debt            $10,865
Attn: Robert Martin
6820 Airport Drive
Riverside, CA 92504
Tel: (951) 688-0241

Procopio, Cory Hargreaves      trade debt            $10,604

PCR Services Corp.             trade debt            $7,862

Dale Christian Structural      trade debt            $7,000

Lantex Landscape Architecture  trade debt            $5,360

Power Plus                     trade debt            $3,788

Consolidated Reprographics     trade debt            $3,373

Paul McDonnell                 property taxes        $1,228

O'Reilly Public Relations      trade debt            $462

Property Disclosure Services   trade debt            $100

Steven C. Kiser                legal services        $66

Lead Tracking Solutions        trade debt            $3


MTR GAMING: Posts $11 Million Net Loss in Year ended December 31
----------------------------------------------------------------
MTR Gaming Group Inc. provided financial results for fourth
quarter and year ended Dec. 31, 2008.

For the fourth quarter of 2007, MTR reported net loss was
$8.6 million compared to net income of $518,000 in the fourth
quarter of 2006.

MTR Gaming completed the sale of Binion's Gambling Hall & Hotel to
TLC Casino Enterprises Inc. on March 10, 2008.  The transaction
was subject to purchase price adjustments based on changes in net
working capital, certain capital expenditures between execution
and closing, and, due to market conditions, a $3.5 million working
capital adjustment which remained with Binion's upon closing.  

Net cash to the company at closing was approximately $28.5 million
of which $27.6 million was utilized to reduce amounts outstanding
under its credit facility.

For the year ended Dec. 31, 2007, MTR's net loss of $11.4 million
compared to net income of $4.4 million in 2006, included a
$3.4 million loss from discontinued operations.  

The factors contributing to the decline in operating results for
continuing operations were the decline in margins at Mountaineer
stemming from new competition in Pennsylvania, preopening expenses
related to Presque Isle Downs and the commencement of poker and
table gaming at Mountaineer, operating inefficiencies at Presque
Isle Downs that are inherent in the commencement of a new
operation, and increased interest expense.

                 Liquidity and Sources of Capital

The company has a working capital deficit of $1.7 million as of
Dec. 31, 2007, and its unrestricted cash balance amounted to
$31 million.  The working capital deficit includes $4.2 million of
construction related liabilities and net liabilities held for sale
of $1.7 milion.  

The company anticipated that the operation of poker and table
games at Mountaineer, which commenced Oct. 19, 2007, and Dec. 20,
2007, and the anticipated impact of these new offerings on
Mountaineer's slot machines, hotel, food and beverage and other
departments, will provide additional funds for working capital
needs.

In addition, during 2008 the company has completed the sale of the
real property of the Ramada Inn and Speedway Casino and the sale
of the stock of Speakeasy Gaming of Fremont which owns and
operates Binion's Gambling Hall & Hotel.  The sale of these assets
provided additional funding of approximately $39 million of which
$27.6 million was used for repayment of debt and the remaining
amounts will be used for operations.

At Dec. 31, 2007, the balances in bank accounts owned by
Mountaineer's horsemen, but to which it contribute funds for
racing purses, exceeded its purse payment obligations by
$2.2 million.  This amount is available for payment of future
purse obligations at the company's discretion and in accordance
with the terms of its agreement with the HBPA.  The company also
earn the interest on balances in these accounts.

As of Dec. 31, 2007, there was $143.4 million outstanding under
the credit agreement.  In addition, letters of credit for
approximately $1.6 million were outstanding.  Borrowings during
2007 included $50 million for the Presque Isle Downs slot license
fee.

Upon payment of this fee, the issued $50 million slot license fee
letter of credit for the benefit of the Commonwealth of
Pennsylvania was returned.  There were no amounts outstanding
under the credit agreement at Dec. 31, 2006.  In March 2008, the
company applied the net proceeds from the sale of the stock of
Speakeasy Gaming of Fremont of $27.6 million to the outstanding
balance of the credit agreement.

As of March 28, 2008, there were outstanding options to purchase
1,390,800 shares of the company's common stock.  If all such stock
options were exercised, the company would receive proceeds of
approximately $11.8 million.

At Dec. 31, 2007, the company's balance sheet showed total assets
of $610.962 million, total liabilities of $498.815 million and
total shareholders' equity of $112.147 million.

                        About MTR Gaming

Headquartered in Chester, West Virginia, MTR Gaming Group Inc.
(NasdaqGS:MNTG) -- http://www.mtrgaming.com/-- owns and operates    
the Mountaineer Race Track & Gaming Resort in Chester, West
Virginia; Scioto Downs in Columbus, Ohio; the Ramada Inn and
Speedway Casino in North Las Vegas, Nevada; Binion's Gambling Hall
& Hotel in Las Vegas, Nevada; and holds a license to build Presque
Isle Downs, a thoroughbred racetrack with pari-mutuel wagering in
Erie, Pennsylvania.  The company also owns a 50% interest in the
North Metro Harness Initiative LLC, which has a license to
construct and operate a harness racetrack and card room outside
Minneapolis, Minnesota and a 90% interest in Jackson Trotting
Association LLC, which operates Jackson Harness Raceway in
Jackson, Michigan.

                           *     *     *

As reported in the Troubled Company Reporter on April 7, 2008,
Moody's Investors Service placed the ratings of MTR Gaming Group
Inc. on review for possible downgrade after the announcement
in the 10-K of a material weakness in internal controls related to
financial reporting.  These ratings were placed under review for
possible downgrade: (i) corporate family rating, rated B1; (ii)
probability of default rating, rated B1; (iii) $130 million 9.75%
senior unsecured notes due 2010, rated B2 (LGD4, 60%), and;
(iv) $125 million 9% senior subordinated notes due 2012, rated B3
(LGD5, 88%).


N-45 FIRST: Moody's Lifts Rating to Ba1 from Ba2 on Class E Certs.
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes
and affirmed the ratings of five classes of N-45 First CMBS Issuer
Corp. 2003-1 as:

  -- Class A-1, $5,962,350, affirmed at Aaa
  -- Class A-2, $278,574,000, affirmed at Aaa
  -- Class B, $8,396,000, affirmed at Aaa
  -- Class C, $16,792,000, upgraded to Aa1 from Aa2
  -- Class D, $19,590,000, upgraded to A3 from Baa2
  -- Class E, $13,993,000, upgraded to Ba1 from Ba2
  -- Class F, $9,095,000, affirmed at B2
  -- Class IO, Notional, affirmed at Aaa

Moody's is upgrading Classes C, D and E due to increased credit
support resulting from loan pay offs, amortization and improved
pool performance.

As of the Apr. 1, 2008 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 34.7%
to $365.7 million from $559.7 million at securitization.  The
Certificates are collateralized by 33 mortgage loans ranging in
size from less than 1.0% to 16.6% of the pool, with the top 10
loans representing 49.9% of the pool.  The pool includes three
loans with underlying ratings, representing 27.4% of the pool.  
One loan, representing 3.7% of the pool, has defeased and has been
replaced with Canadian Government securities.  There are no loans
on the master servicer's watchlist.  There have been no realized
losses since securitization and there are no loans in special
servicing.

Moody's was provided with full-year 2006 operating results for
91.6% of the pool.  Moody's loan to value ratio for the conduit
portion is 61.4%, compared to 67.0% at Moody's last full review in
December 2006 and 79.3% at securitization.

The largest loan group with an underlying rating is a crossed pool
collateralized by the Place Dupuis Building and Les Atrium Loan
Group ($50.6 million -- 13.8%), which is secured by two Class B
office buildings located in downtown Montreal, Quebec.  The Place
Dupuis Building (813,000 square feet) was built in 1972 and
renovated in 1979.  The Les Atrium building (220,500 square feet)
was built in 1939.  The major tenant in the Place Dupuis Building
is Hydro Quebec (Moody's senior unsecured rating Aa2; 70.0% NRA;
lease expirations 2008, 2010 and 2012).  The loan amortizes on a
23-year schedule and has amortized 10.5% since securitization.  
The loan is full recourse to the borrower.  Moody's current
underlying rating is Baa2, the same as at last review and compared
to Baa3 at securitization.

The second largest loan with an underlying rating is the Centre
Commercial Centre Laval Loan ($32.8 million -- 9.0%).  The loan is
secured by the borrower's interest in a 500,000 square foot
regional mall constructed in four phases between 1968 and 1991 and
renovated in 1998.  The mall is located approximately 15 miles
west of Montreal in Laval, Quebec.  The center is anchored by
Wal-Mart (30.1% GLA; lease expiration January 2013), Best Buy
(7.7% GLA; lease expiration 2020) and Future Shop (7.1% GLA; lease
expiration 2019).  The center is also shadow anchored by The Bay.  
As of March 2007, occupancy was 97.5% compared to 98.0% at last
review and 99.0% at securitization.  The loan is full recourse to
the borrower and amortizes on a 20-year schedule.  The loan has
amortized 13.7% since securitization.  Moody's current underlying
rating is Aaa compared to Aa2 at last review and A2 at
securitization.

The third largest loan with an underlying rating is the Preston
Crossing Loan ($16.7 million -- 4.6%).  The loan is secured by the
borrower's interest in a 250,000 square foot regional mall
constructed in 2002 and located in Saskatoon, Saskatchewan.  The
center is anchored by Canadian Tire (32.0% GLA, lease expiring
October 2022), Sobeys (16.0% GLA; lease expiration 2022), The Bay
(14.0% GLA; lease expiration November 2017).  Other tenants
include Michaels and Future Shop.  As of March 2007, the property
was 100.0% occupied, the same as at last review and at
securitization.  The loan amortizes on a 20-year schedule and is
full recourse to the borrower.  Moody's current underlying rating
is Baa3, the same as at last review and at securitization.

The top three conduit loans represent 31.8% of the pool.  The
largest conduit loan is the State Street Financial Centre Loan
($60.7 million -- 16.6%), which is secured by a 414,000 square
foot Class A office building located in downtown Toronto, Ontario.  
The property was built in 1957, renovated in 2001 and is part 12
and part 17 stories high.  The loan amortizes on a 25-year
schedule.  The largest tenant is International Financial Data
Services (32.0% NRA; leased through October 2013).  As of March
2008, the property was 86.0% occupied compared to 100.0% at last
review and at securitization.  The loan is full recourse to the
borrower and amortizes on a 25-year schedule.  The loan has
amortized 8.8% since securitization.  Moody's LTV is 69.4%,
compared to 75.6% at last review and 84.5% at securitization.

The second largest conduit loan group is the Office Campus I, II
and IV Loan ($28.6 million -- 7.8%), which is secured by three
crossed loans secured by three office properties located in
Ottawa, Ontario.  The buildings were built in 2001 and contain
230,000 square feet.  The loan amortizes on a 25-year schedule.  
As of March 2007, the property was 100.0% occupied the same as at
last review and at securitization.  The loan has amortized 9.0%
since securitization and matures July 2008.  Moody's LTV is 78.9%
compared to 82.0% at last review and 88.2% at securitization.

The third largest conduit loan is the Place Portobello & Les
Galeries de la Chaudiere Loan ($27.1 million -- 7.4%), which is
secured by two anchored retail centers totaling 603,000 square
feet.  Place Portobello is located in Brossard, south of Montreal.  
Les Galeries de la Chaudiere is situated in Sainte-Marrie,
approximately 34 miles south of Quebec City, Quebec.  Built in
1965, Place Portobello represents 85.0% of the collateral.  The
major tenant is Wal-Mart (24.0% GLA; lease expiration January
2010).  The loan amortizes on a 20-year schedule and is full
recourse to the borrower.  The loan has amortized 18.2% since
securitization.  Moody's LTV is 48.0% compared to 54.4% at last
review and 70.2% at securitization.


NEXSTAR BROADCASTING: S&P Assigns Ratings on Negative CreditWatch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Nexstar
Broadcasting Group Inc., including the 'B' corporate credit
rating, on CreditWatch with negative implications.  The Irving,
Texas-based TV broadcasting company had total debt of about
$681 million as of Dec. 31, 2007.
      
"The CreditWatch placement reflects our heightened concern about
Nexstar's ability to remain in compliance with its financial
covenants," said Standard & Poor's credit analyst Deborah Kinzer.


NORANDA ALUMINUM: December 31 Balance Sheet Upside-Down by $76,000
------------------------------------------------------------------
Noranda Aluminum Holding Corporation's balance sheet at Dec. 31,
2007, showed total assets of $1,650,544,000 and total liabilities
of $1,650,620,000, resulting to total shareholders' deficit of
$76,000.

The company reported financial results for the fourth quarter and
fiscal year ended Dec. 31, 2007.

Fourth quarter net income was $2.485 million compared to
$31.888 million for the same period in the previous year.

For full year ended Dec. 31, 2007, the company's net income was
$22.424 million compared to $113.912 million in 2006.

During the quarter and subsequent to year end, the company entered
into additional forward aluminum sales contracts.  Including the
recent hedges, the company has hedged approximately 50% of
forecasted production through 2012 at prices which are attractive
compared with the company's expected cost of producing primary
aluminum.

The company's $250 million revolving credit facility remained
undrawn at Dec. 31, 2007, with cash-on-hand of $75.6 million.
Total debt at year-end was $1,151.7 million.  The company's net
debt to EBITDA ratio at year end was 1.13x, 2.77x and 3.48x at the
Senior Secured Level, Senior Debt and the Holdco level.

                      About Noranda Aluminum

Noranda Aluminum Holding Corp. -- http://www.norandaaluminum.com/  
-- is a North American integrated producer of value-added primary
aluminum products as well as high quality rolled aluminum coils.  
The company has two businesses, the primary metals business, or
upstream business, which produces approximately 250,000 metric
tons of primary aluminum annually, and the rolling mills, or
downstream business, which is one of the largest foil producers in
North America and a major producer of light gauge sheet products.  
Noranda is a private company owned by affiliates of Apollo
Management LP.

                          *     *     *

Standard & Poor's placed Noranda Aluminum Holding Corp.'s long
term foreign and local issuer credit ratings at 'B' in May 2007.  
The ratings still hold to date with a stable outlook.


NORTH FOREST: S&P Removes 'BB' Rating From CreditWatch Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services removed its 'BB' issuer credit
rating and underlying rating on North Forest Independent School
District, Texas' general obligation debt from CreditWatch with
negative implications.  The negative outlook reflects the
potential for additional financial pressure, despite actions by
management designed to stabilize the district's financial
condition.
     
At the same time, Standard & Poor's affirmed its 'AAA' rating, and
stable outlook, on the district's bonds guaranteed by the Texas
Permanent School Fund.
     
Standard & Poor's recently lowered its GO debt rating on the
district two notches, to 'BB' from 'BBB-', and placed the rating
on CreditWatch with negative implications due to the district's
significant financial deterioration and the potential for the
district to cease operations.  Over the past 60 days, however,
management has taken several actions that could have an immediate
and lasting financial effect, including the reduction of 50
positions for the current fiscal year, the planned reduction of 90
positions for the following school year, and the scheduled merging
of four schools into two schools.
      
"The potential exists for additional financial pressure that could
cause severe distress and further weaken the district's credit,"
said Standard & Poor's credit analyst James Breeding.  "The
district still needs to replenish bond funds used for general
operations while cutting expenditures, stabilizing the management
team, and consolidating schools."
     
The district ended fiscal 2007 with a severe unreserved general
fund balance decline -- to a negative $6.7 million from a positive
$14.8 million in fiscal 2006 -- based on a number of factors,
including the recording of a $7.3 million liability to the state
of Texas for the overpayment of per-pupil funding in the previous
year and deficit spending in the instructional, school leadership,
and administration areas.  According to the auditor, the
overpayment by the state was due to improper reporting of student
enrollment, while deficit spending was due to the finance
department's understaffing and lack of monitoring.  The
independent auditor also expressed concern about the district's
ability to continue to exist.  Following reconciliation efforts
with the Texas Education Agency, the overpayment amount has been
reduced to $5.2
million.
     
The adopted fiscal 2008 budget showed balanced operations, but did
not include the state's withholding of $7.3 million.  Therefore, a
significant shortfall is expected.  The operations and maintenance
tax rate has already been set at the current state maximum of
$1.04 per $100 of assessed value, with an additional levy for debt
service; tax collections remain below average, at less than 90%.   
The district has not adopted a revised budget, and the ending
balance will remain negative.  For fiscal 2009, district officials
are hoping that the cost-cutting measures they have implemented
will result in a $10 million to $12 million general fund savings.
     
The rating action affects roughly $68 million of outstanding debt.


NORTHWEST AIRLINES: Board Votes "For" Merger with Delta Air
-----------------------------------------------------------
The board of directors of both Delta Air Lines Inc. and Northwest
Airlines Corp. gave their consent Monday to allow the two airlines
to merge based on an all-stock deal, The Wall Street Journal and
The Associated Press relate.

The combination of Delta and Northwest, which is still subject to
regulatory approval, stands to create the world's largest airline
operator in the world valued at $17.7 billion, AP says.

Under the merger, each Northwest shareholder will get 1.25 shares
in the combined company for every share owned, or equivalent to
17% premium as of Monday's trading, based on WSJ's and AP's
reports.

Both reports recount that Delta and Northwest have emerged from
bankruptcy in 2007 and "are in much better shape" as compared with
smaller airlines that have recently gone bankrupt.

The deal, reportedly, could incite potential workers' protest.


                   Air France-KLM Partnership

Reports note that Delta and Northwest have partnered with Air
France-KLM SA, which previously indicated plans to invest
$750.0 million in the merger of the two U.S. airlines.

As reported in the Troubled Company Reporter on Feb. 22, 2008,
amid the merger rumors, Franco-Dutch airline Air France-KLM
expressed its interest to invest in the entity that would emerge
from a Delta and Northwest merger.  Pierre-Henri Gourgeon, Air
France-KLM's deputy CEO said in an analysts' conference call that
the investment would depend on whether the U.S. airlines obtain a
green light from competition authorities and probably won't result
in any payments before the end of 2008.  The investment is said to
be close to $1.0 billion or EUR680.0 million.

                          Labor Issues

Concerning potential employee protest, the TCR said on April 10,
2008, that Northwest and Delta have revived their merger talks,
even without the pre-arranged deal from both carriers' pilots,
said people familiar with the situation.  Delta's board members
convened on April 4, 2008, and agreed to continue the talks which
were reportedly intensifying.  

Delta pilots were granted permits to picket at Northwest hubs
from April 8 to 24, to protest over the carriers' pilot-seniority
dispute.  Northwest's pilots union said it reserves the right to
do the same thing at Delta hubs if it chooses.

Previouisly, pilots' leaders from both carriers were unable to
reach an agreement on an acceptable seniority list integration.  
The original deal between the parties included a common pilot
labor contract for their combined 11,000 pilots that would give
all of them raises, with Northwest's 5,000 aviators getting
heftier increases to bring them up to Delta levels.  The new deal
may include a smaller pay package for pilots.

The carriers are not required by law to come up with pre-merger
pilots' labor agreements to push through with the deal.  Delta and
Northwest, however, wanted to avoid a messy, labor wrangle once
the deal was consummated and, therefore, made efforts to come up
with a "common labor contract."

A report about Delta reaching an agreement in principle with its
pilots that would purportedly clear the way for the carrier's
merger with Northwest is included in today's TCR issue.

               Expected Revenue Boost After Merger

Once approved by regulators, the merger will result in a projected
annual sales of $31.7 billion, significantly higher than American
Airlines Inc.'s annual sales, according to AP.

WSJ reports that the merger will realize annual revenue and cost
reduction will reach at least $1.0 billion.  WSJ adds that the
Delta and Northwest will need less than $1.0 billion to complete
the merger.

                Wave of U.S. Airline Consolidation

According to the reports, the merger signals the start of a series
of collaborative efforts among U.S. airlines to address the rise
in fuel costs, weakened economy, and the financial crisis.  Larger
airlines also have greater ability to compete internationally,
relate the reports.

The TCR related on March 24, 2008, that United Air Lines Inc.
would pursue a consolidation with Continental Airlines Inc. if
given the go-ahead, to create the airline industry's biggest
carrier.

Stephen Canale, a union representative on United Airlines' board
of directors, said that Continental is "without question" the
first choice for a United merger.

The TCR said that the merger between Delta and Northwest, which
was at that time currently under consideration, could incite a
United-Continental tie-up.

                         About Delta Air

Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners.  Delta flies to
Argentina, Australia and the United Kingdom, among others.

The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts.  Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice.  Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice.  John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors.

The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.  On
Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on
Feb. 2, 2007.  On Feb. 7, 2007, the Court approved the Debtors'
disclosure statement.  In April 25, 2007, the Court confirmed the
Debtors' plan.  That plan became effective on April 30, 2007.  The
Court entered a final decree closing 17 cases on Sept. 26, 2007.  
(Delta Air Lines Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 17, 2008,
Standard and Poor's said that media reports that Delta Air Lines
Inc. (B/Positive/--) entered into merger talks with UAL Corp.
(B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will
have no effect on the ratings or outlook on Delta, but that
confirmed merger negotiations would result in S&P's placing
ratings of Delta and other airlines involved on CreditWatch, most
likely with developing or negative implications.

                     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 US$14.4 billion
in total assets and US$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 Airlines Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.


NORTHWEST AIRLINES: Seeks Allowance for $5,954,902 ALPA Claims
--------------------------------------------------------------
The Air Line Pilots Association, International filed Claim No.
9311 against Northwest Airlines Corp. and its debtor-affiliates --
for not less than $921,395,651 -- asserting three separate groups
of claims:

   * prepetition discharge grievances and prepetition non-
     discharge grievances -- the Disputed Claim -- for no less
     than $7,581,351;

   * the second portion of the Claim relating to employee pre-
     grievances and grievances, was previously allowed by the
     Court as a general unsecured claim for $888,000,000,
     pursuant to a restructured collective agreement between the
     Debtors and ALPA that was approved by the U.S. Bankruptcy
     Court for the Southern District of New York; and

   * the final portion of the Claim asserts an unliquidated
     amount for employee wages and benefits that the Debtors
     continue to honor in the ordinary course of business.

                 Settlement Agreement with ALPA

Pursuant to Rule 9019 of the Federal Rules of Bankruptcy
Procedure, the Debtors ask the Court to approve a settlement
agreement resolving Claim No. 9311.

The Settlement Agreement provides that in full and final
satisfaction of the Non-Discharge Grievances, the Disputed Claim
is liquidated and fixed:

   (a) as an allowed general unsecured claim for $4,954,902; and

   (b) as an allowed administrative expense claim for $1,000,000.

Any amounts contained in Claim No. 9311 in excess of the sum of
the Allowed Non-Discharge Grievance Claim and the previously
approved Allowed ALPA Claim are disallowed in their entirety.

Subject to Court approval, the Debtors will cooperate with ALPA
in the sale of ALPA's Allowed General Unsecured Grievance Claim,
and make a cash distribution of the net proceeds of the sale to
the individual pilots designated by ALPA.

The Debtors will make a catch-up distribution to any purchaser of
the Allowed General Unsecured Grievance Claim on the later of (i)
at least 11 days after the Court's approval of the Settlement
Agreement that is not subject to an appeal or stay, or (ii) the
first business day that is at least 11 days after the Debtros are
notified of the identity of the purchaser.

If, for any reason, ALPA is not able to sell its Allowed General
Unsecured Grievance Claim, and so notifies the Debtors in
writing, the Debtors will make a Catch-Up Distribution on the
Allowed General Unsecured Grievance Claim to the individual
employees identified by ALPA to receive distributions.

The Debtors will then direct their transfer agent to promptly
sell the shares on behalf of those individuals, and pay the net
proceeds in accordance with the allocation instructions provided
by ALPA.  Subsequent distributions, if any, will be treated
similarly, if feasible in light of the amount of the subsequent
distributions, with the Bankruptcy Court to resolve any relating
disputes.

If the Settlement Agreement is approved by the Court, the only
Prepetition Discharge Grievances that will remain unresolved and
may be pursued by ALPA are seven grievances specifically
mentioned in the Settlement, a full-text copy of which is
available for free at:

       http://bankrupt.com/misc/NWA_ALPASettlementPact.pdf

                     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 Airlines Bankruptcy News,
Issue No. 89; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.


NORTHWEST AIRLINES: Delta and Pilots Pact Clears Way for Merger
---------------------------------------------------------------
Delta Air Lines Inc. and its pilots have reached an agreement  
in principle on a contract that would purportedly clear the way
for the carrier's merger with Northwest Airlines Corp.,
Bloomberg News reports.

[The Wall Street Journal has reported that the board of directors
of both airline companies approved the merger.  A separate story
is included in today's Troubled Company Reporter.]

The accord would allegedly raise Delta pilots' pay and give them
an equity stake in the consolidated carrier, people familiar with
the talks said.

Any pact would need to be approved by the leaders of the Delta
pilots union, a unit of the Air Line Pilots Association, before
the carriers could finalize their deal, says The Atlanta Journal-
Constitution.  The Delta union's 6,000 members also may vote
later on whether to ratify a new labor contract tied to the
merger.

"With oil at $110 per barrel and the weakening economy, Delta
probably got to the point where they felt like they needed to
move ahead," said Michael Derchin, an analyst with FTN Midwest
Research Securities Corp. in New York.  "It always made
strategic, long-term sense for these companies."

The merger talks hit a snag in February when the airlines' pilots
weren't able to agree on a way to protect members' seniority
rankings after a consolidation.

Now, Delta wants to draw up a new contract with just its 7,000
pilots, and Northwest's 5,000 pilots would be asked to join under
a single contract later, said the people who didn't want to be
identified because the plan is still private.  The plan includes
a small premium for Northwest investors, the unidentified sources
said, reports Bloomberg.

"It's sort of a backhanded slap at the Northwest pilots," said
Douglas Marshall, director of the Aviation Graduate Program at
the University of North Dakota.  "Delta's pilots are going to
have more leverage.  They will be in a stronger position."

Negotiations to create a combined seniority list may take months
to complete, Bloomberg says, citing people familiar with the
situation.

"It is hard to anticipate Northwest pilots' level of interest in
agreeing to an unknown Delta seniority integration proposal,"
said Robert Mann of R.W. Mann & Co. in Port Washington, New York,
a consultant for airlines and unions.

Betsy Talton, spokeswoman for Delta, and Tammy Lee, a spokeswoman
for Northwest, declined to comment.

                          About Delta Air

Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners.  Delta flies to
Argentina, Australia and the United Kingdom, among others.

The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts.  Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice.  Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice.  John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors.

The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.  On
Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on
Feb. 2, 2007.  On Feb. 7, 2007, the Court approved the Debtors'
disclosure statement.  In April 25, 2007, the Court confirmed the
Debtors' plan.  That plan became effective on April 30, 2007.  The
Court entered a final decree closing 17 cases on Sept. 26, 2007.  
(Delta Air Lines Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 17, 2008,
Standard and Poor's said that media reports that Delta Air Lines
Inc. (B/Positive/--) entered into merger talks with UAL Corp.
(B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will
have no effect on the ratings or outlook on Delta, but that
confirmed merger negotiations would result in S&P's placing
ratings of Delta and other airlines involved on CreditWatch, most
likely with developing or negative implications.

                     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 US$14.4 billion
in total assets and US$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 Airlines Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.


NORTHWEST AIRLINES: Dissolves NWA Inc. and NWA Holdings
-------------------------------------------------------
Northwest Airlines Corp. and its debtor-affiliates informed Judge
Allan L. Gropper of the U.S. Bankruptcy Court for the Southern
District of New York that under the terms of their confirmed Plan
of Reorganization:

   -- NWA Inc. would merge with and into Northwest Airlines,
      Inc.; and

   -- Northwest Airlines Holdings Corporation would merge with
      and into NWA Inc.

Pursuant to the General Corporation Law of the State of Delaware,
and the Business Corporation Act of the State of Minnesota, NWA
Inc. filed with the Secretary of State for the State of Minnesota
its Certificate of Ownership and Merger Merging NWA Inc. into
Northwest Airlines Inc.

As provided for by the General Corporation Law of the State of
Delaware, Holdings filed with the Secretary of State for the
State of Minnesota its Certificate of Ownership and Merger
Merging Northwest Airlines Holdings Corporation into NWA Inc.

Accordingly, each of NWA Inc. and Northwest Holdings ceased to
exist as separate coporate entities, without the necessity for
any other or further actions to be taken, or payments to be made,
on behalf of the Debtors.

                     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 Airlines Bankruptcy News,
Issue No. 89; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.


NORTHWEST AIRLINES: Makes Four Additional Shares Distribution
-------------------------------------------------------------
Northwest Airlines Corp. and its debtor-affiliates made four
distribution of shares of new common stock, from May 31, 2007, to
Jan. 2, 2008:

   (1) an initial distribution on May 31, 2007;
   (2) a catch-up distribution on July 16, 2007;
   (3) a periodic and catch-up distribution on Oct. 1, 2007;
       and
   (4) a periodic distribution and a Catch-up Distribution on
       Jan. 2, 2008.

Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, informs Judge Gropper that the Debtors were set to
make a periodic distribution and a catch-up distribution last
April 1, 2008, of:
                                         Expected No.   
   New Common Stock                       of Shares        
   ----------------                      ------------   
   For Creditors Allocable to               2,668,330
   Class 1D
   
   For Creditors With A Guaranty               30,847    

According to Mr. Petrick, the total estimated amount of shares of
New Common Stock remaining in the Distribution Reserve are:

                                         Expected No.   
   New Common Stock                       of Shares              
   ----------------                      ------------           
   For Creditors Allocable to              23,564,009
   Class 1D
   
   For Creditors With A Guaranty              711,915

Mr. Petrick also informs Judge Allan L. Gropper of the U.S.
Bankruptcy Court for the Southern District of New York that the
total amount of shares of New Common Stock distributed pursuant to
the Debtors' Plan of Reorganization, as of March 17, 2008, was:

                                              Amount  
   New Common Stock                         of Shares  
   ----------------                         ---------    
   For Creditors Allocable to             195,505,407
   Class 1D
    
   For Creditors With A Guaranty            7,880,010

   Pursuant to Rights Offering             27,777,778

                     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 US$14.4 billion
in total assets and US$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 Airlines Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Northwest Airlines Corp. and its Northwest Airlines Inc.
subsidiary, including raising the long-term corporate credit
ratings on both entities to 'B+' from 'D', following their
emergence from Chapter 11 bankruptcy proceedings.  S&P said the
rating outlook is stable.

In addition, S&P assigned a 'BB-' bank loan rating, one notch
above the corporate credit rating, with a '1' recovery rating,
to Northwest Airlines Inc.'s $1.225 billion bankruptcy exit
financing, based on S&P's expectation of a full recovery of
principal in the event of a second Northwest bankruptcy.   That
bank facility converted from a debtor-in-possession credit
facility; S&P withdrew the 'BBB-' rating on the DIP facility.


ORIGINAL TOTAL: Case Summary & Five Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Original Total Blend Restaurant, Inc.
        aka 3921 Original Total Blend Realty, LLC
        3817 White Plains Road
        Bronx, NY 10467

Bankruptcy Case No.: 08-11237

Type of Business: The Debtor owns and manages a restaurant.

Chapter 11 Petition Date: April 8, 2008

Court: Southern District of New York (Manhattan)

Judge: Burton R. Lifland

Debtor's Counsel: Nestor Rosado, Esq.
                     (neslaw2@msn.com)
                  55 Overlock Terrace, Suite 1H
                  New York, NY 10033
                  Tel: (212) 781-4808
                  Fax: (212) 781-5104

Total Assets: $1,300,000

Total Debts:    $986,125

Debtor's Five Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Internal Revenue Service       $152,285
P.O.Box 37004
Hartford, CT 06176-0004

NYS Department of Taxation &   $96,614
Finance
55 Hanson Place
Brooklyn, NY 11217

Siegmund Strauss, Inc.         $5,664
Attn: Martin Bienstock,
City Marshal
36-35 Bell Boulevard
Bayside, NY 11361
Tel: (212) 279-3660

State of New York Department   $4,251
of Labor

Laconia Meat Corp.             $4,000


PARAMOUNT RESOURCES: Earns $416.2 Million in Year Ended Dec. 31
---------------------------------------------------------------
Paramount Resources Ltd. reported net earnings of $416.2 million
on petroleum and natural gas sales of $283.4 million for the year
ended Dec. 31, 2007, compared with a net loss of $17.8 million on
petroleum and natural gas sales of $312.6 million for the year
ended Dec. 31, 2006.

The increase in net earnings was primarily due to:

  -- Higher income from equity investments, including the gain on
     sale of North American shares of $528.6 million;

  -- Higher gains on sale of property, plant and equipment,
     including the gain on sale of the Surmont Assets of
     $271.0 million;

  -- Increased investment and other income; and

  -- Unrealized foreign exchange gains.

These changes were partially offset by:

  -- A higher future income tax provision;

  -- A higher write-down of petroleum and natural gas properties;

  -- Unrealized losses on financial instruments in 2007 versus
     unrealized gains on financial instruments in 2006; and

  -- Higher dry hole expense.

Revenue from natural gas, oil and NGLs sales in 2007 was
$283.4 million, down 9% from 2006 due primarily to the impact of
lower realized natural gas prices and sales volumes, partially
offset by higher realized oil and NGLs prices.

                          Sales Volumes

Average daily natural gas sales volumes decreased to 78.8 MMcf/d
in 2007 compared to 81.6 MMcf/d in 2006.  The decrease was
primarily a result of production declines in Northern at Bistcho
and the shut-in of the Maxhamish facility in October 2007, and
normal production declines in Grande Prairie at Mirage.  These
decreases were partially offset by increases in daily natural gas
sales volumes as a result of drilling and tie-in activities from
Paramount's 2007 capital program, primarily at Musreau and
Resthaven in Kaybob and Chain in Southern.

Average daily crude oil and NGLs sales volumes decreased to 3,536
Bbl/d in 2007 compared to 3,653 Bbl/d in 2006, primarily as a
result of declines in Cameron Hills oil production in Northern,
partially offset by new production in Grande Prairie and Kaybob.
Oil production increased in Southern in the fourth quarter of 2007
as new wells in North Dakota were bought on production.

Paramount's original 2007 annual production outlook was 21,000
Boe/d and actual production was 16,669 Boe/d.  The reduction from
budget was due to several factors including: weather delays in
Southern and Kaybob, lower production than expected in Kaybob,
non-core property and facility disposals, equipment and other
facility issues, and delays in rig arrival and commissioning in
Southern.

                         Commodity Prices

Paramount's average realized natural gas price for 2007, before
realized gains on financial commodity contracts, decreased to
$6.77/Mcf compared to $7.66/Mcf in 2006.  

Paramount's average realized oil and NGLs price for 2007, before
realized losses on financial commodity contracts, increased to
$68.74/Bbl compared to $63.27/Bbl in 2006.  

                            Royalties

Royalties decreased 11% to $42.7 million in 2007 compared to
$48.0 million in 2006, primarily as a result of decreases in
Paramount's revenue.  The 2007 royalty expense included the impact
of allowable deductions for operating and capital costs for
royalty purposes on frontier lands in the Northwest Territories
and lower deep gas royalty holidays in Kaybob.

                      Strategic Investments

Strategic Investments at Dec. 31, 2007 include the following:

  -- equity investments in Trilogy and MGM Energy;

  -- oil sands investments, including shares in MEG Energy and
     carbonate bitumen holdings; and

  -- drilling rigs in the United States operated by Paramount's
     wholly owned subsidiary, Paramount Drilling U.S. LLC.

Income from equity investments includes a $528.6 million gain on
sale of Paramount's investment in North American shares.  This
gain is net of expenses, including a bonus of 150,000 common
shares of Paramount paid to the chairman and chief executive
officer of Paramount under the company's stock incentive plan.
Income from equity investments also includes net dilution gains of
$23.1 million and net equity losses of $1.7 million.  Prior year
equity earnings include dilution gains of $111.3 million related
to North American and $18.4 million related to Trilogy.

             Income and Other Tax Expense (Recovery)

Income and other tax expense was $43.2 million for the year ended
Dec. 31, 2007, compared with income and other tax recovery of
$50.1 million for the year ended Dec. 31, 2006.

                 Liquidity and Capital Resources

a) Working Capital

Paramount's working capital surplus position at Dec. 31, 2007, was
$120.6 million compared to a deficit of $84.3 million at Dec. 31,
2006.  Included in working capital as of Dec. 31, 2007, was
$83.3 million in cash and cash equivalents and $95.7 million in
short-term investments, including the MEG Note.

The increase in working capital is primarily the result of the
disposition of certain Strategic Investments and non-core
Principal Properties during the year for total proceeds of in
excess of $1.0 billion.  In March 2007, Paramount closed a six
month $100 million short-term facility that was repaid and
cancelled on June 29, 2007.

b) Bank Credit Facility

At Dec. 31, 2007, Paramount's credit agreement had a $170 million
gross borrowing base with a net borrowing base of $155 million.  
At Paramount's request, the banking syndicate has provided
aggregate commitments to lend up to $125 million.  As of Dec. 31,
2007, no balances were drawn on the credit facility, however,
Paramount had undrawn letters of credit outstanding totalling
$15.5 million that reduce the amount available to the company
under the credit facility.

c) US Senior Notes

During the third quarter of 2007, Paramount made open market
purchases of $75.4 million principal amount of its 8.5% US Senior
Notes, reducing the net principal outstanding to $138.2 million
(CN$136.5 million) at Dec. 31, 2007.  Paramount may re-market the
purchased debt at its discretion.

d) Term Loan B Facility

On July 3, 2007, Paramount repaid the entire principal outstanding
of its $150 million TLB Facility.  The TLB Facility is no longer
available to the company.

e) Share Capital

The company received regulatory approval for a NCIB ending on
May 6, 2008.  Under the NCIB, the company was permitted to
purchase up to 3,298,526 of its common shares for cancellation.
Effective Dec. 19, 2007, Paramount received regulatory approval
for an amendment to the NCIB which increased the number of shares
available for purchase to 3,546,859.  To Dec. 31, 2007, Paramount
purchased and cancelled 3,298,526 common shares for $54.9 million.

At March 10, 2008, Paramount had 67,686,374 common shares
outstanding, 6,206,750 stock options (with each entitling the
holder to acquire one common share) outstanding (872,850
exercisable) and 300,625 Holdco options outstanding (226,125
exercisable).

                     Contractual Obligations

At Dec. 31, 2007, the company has total contractual obligations,
which consist of the US Senior Notes (including interest), asset
retirement obligations, pipeline transportation commitments,
capital and drilling spending commitment, and operatin leases, of
$547.5 million.

                          Balance Sheet

At Dec. 31, 2007, the company's consolidated balance sheet showed
$1.300 billion in total assets, $391.2 million in total
liabilities, and $908.6 million in total stockholders' equity.

                    About Paramount Resources

Headquartered in Calgary, Alberta, Canada, Paramount Resources
Ltd. (TSE: POU) -- http://www.paramountres.com/-- is a Canadian    
oil and natural gas exploration, development and production
company with operations focused in Western Canada.  

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 25, 2007,
Moody's Investors Service raised the rating for Paramount
Resources Ltd.'s senior secured notes to Caa1 (LGD 4, 56%) from
Caa2 (LGD 4, 60%).  Moody's also affirmed Paramount's Caa1
corporate family rating and the Caa1 probability of default
rating.  The outlook remains stable.


PEACE ARCH: Insiders May Now Resume Share Trading
-------------------------------------------------
Peace Arch Entertainment Group Inc. disclosed that as of April 3,
2008, a management and insider cease trade order was lifted,
allowing certain directors, officers and employees of the company
to continue trading in the company's securities.

Peace Arch said that after it filed its Nov. 30, 2007 interim
financial statements on March 31, 2008, the Ontario Securities
Commission and the British Columbia Securities Commission issued a
revocation order to the management and insider cease trade order
dated Dec. 13, 2007, which prohibited trading by directors,
officers and certain employees of Peace Arch in the securities of
the company.

                        About Peace Arch

Based in Toronto, Los Angeles, and London, Peace Arch
Entertainment Group Inc. (AMEX: PAE) (TSX: PAE) --
http://www.peacearch.com/-- produces and acquires feature films,   
television and home entertainment content for distribution to
worldwide markets.  Peace Arch owns one of the largest libraries
of top quality independent feature films in the world, featuring
more than 1000 classic and contemporary titles.


                          *     *     *

As reported in the Troubled Company Reporter on March 28, 2008,
Peace Arch's management said in its Form 20-F report to the U.S.
Securities and Exchange Commission for the fiscal year ended
Aug. 31, 2007, that while the company continues to maintain its
day-to-day activities and produce and distribute films and
television programming, its working capital situation is severely
constrained.  

The company also that it operates in an industry that has long
operating cycles which require cash injections into new projects
significantly ahead of the delivery and exploitation of the final
production.

If the company is unsuccessful in its financing efforts and in
achieving sufficient cash flows from operating activities, the
company may be required to significantly reduce or limit
operations.  

These factors cast substantial doubt on the company's ability to
continue as a going concern.


PERVASIP CORP: Appoints Scott Widham to Board of Directors
----------------------------------------------------------
Pervasip Corp. appointed Scott Widham to its board of directors.

"We are pleased that a person of [Mr. Widham's] caliber is joining
our board of directors," Pervasip's CEO, Paul Riss, said.  "His
business experience in the cable industry and with Broadwing,
which exceeded $875 million in annual revenue before it was
purchased by Level 3, will make him a valuable member on the
Pervasip board.  [Mr. Widham] has already introduced us to two of
the ten largest cable carriers, and we anticipate that we can
provide our SIP-based voice-over-IP solution in the 'dead spots'
that the cable carriers cannot reach with their packet cable
telephony product."

"The Pervasip team has done an incredible job in making the
company a significant force in the wholesale IP telephony world,"
Mr. Widham said.  "I have been particularly impressed with the
versatility and scalability of the IP platform and the company's
commitment to the open source movement."  

"I am especially looking forward to bringing their IP voice
product to my cable contacts, as the major cable carriers do not
have a cost effective solution for reaching their customers in
secondary and tertiary markets," Mr. Widham continued.  "I have
been working with the company since November, and I am very
excited about what we may be able to accomplish in 2008."

mr. Widham, a Principal in CAS, LLC, a technology and telecom
consulting company, has been an entrepreneur in the media and
telecom industries for 30 years.  Mr. Widham serves on the board
of directors of Priva Technologies, Stages and Game Rail.  

Mr. Widham also serves on the board of directors and as a member
of the executive committee of Comptel, a competitive
telecommunications association.  

Mr. Widham was co-CEO of Broadwing Corporation, a voice, data and
video service provider acquired by Level 3.  Prior to joining
Broadwing, Mr. Widham was the founder and CEO of Capital Cable, a
multi-system operator that owned cable systems across the U.S. and
in Latin America.  Capital Cable was acquired by Charter
Communications.

                       About Pervasip Corp.

Based in White Plains, New York, Pervasip Corp. (OTCBB:PVSP) fka
eLEC Communications Corp. -- http://www.voxcorp.net/and  
http://www.pervasip.com/-- provides an integrated suite of IP-
based communications services and offers wholesale broadband
voice, origination and termination services, well as enhanced
digital telephone service to the small business and residential
marketplace.

At Nov. 30, 2007, the company's balance sheet showed total assets
of $3,917,055 and total liabilities of $10,096,803, resulting to
total stockholders' deficit of $6,179,748.

The company related that it has requested and received assurances
from its principal lender to continue to fund the company and a
promise not to call the outstanding debt through Dec. 1, 2008, so
as to erase any doubt that the company may not be a going concern.


PHIBRO ANIMAL: Completes AIM Market Listing, Raises $45 Million
---------------------------------------------------------------
Phibro Animal Health Corporation completed an institutional
placement of its common shares, which are now listed on the London
Stock Exchange's Alternative Investment Market.  Phibro Animal
Health realized $45 million of gross proceeds from the sale of new
common shares on Alternative Investment Market representing
approximately 13% of the post-transaction equity, reflecting an
equity valuation of $345 million.

The common shares of the company are now held 70% by BFI Co. LLC,
a Bendheim family investment vehicle, and 30% by other non-U.S.
institutional investors including 3i Quoted Private Equity
Limited.  Jack Bendheim has sole authority to vote the common
shares owned by BFI.  3i QPEL has invested a total of
$97.2 million for a 29.9% interest in the company, including its
previously announced purchase of common shares of Phibro Animal
Health from existing shareholders.

After payment of transaction and other related costs,
approximately $25 million will be used to reduce amounts
outstanding under the company's senior credit facility.

"The company is now positioned for the next stage in its strategy
to be an even broader based animal health and nutrition business,
through organic growth and acquisitions," Jack Bendheim, chairman
and president, commented.  "3i QPEL's strategic investment and
broad global network enhances our growth opportunities."

The board of directors now includes Jack Bendheim, chairman and
president; Gerald Carlson, chief executive officer; and non-
executive directors Sam Gejdenson; Alan MacKay, a founding partner
of 3i QPEL; and Mary Lou Malanoski.  The company also intends to
appoint an additional independent non-executive director with
significant industry experience.

Marvin Sussman has resigned as a director and as the chairman of
Prince Agriproducts.  He will continue as a senior advisor to the
company.  James Herlands also has resigned as a director,
following his October 2007 retirement as an executive of the
company.

                    About Phibro Animal Health

Headquartered in Fort Lee, New Jersey, Phibro Animal Health
Corporation (LON: PAHC) -- http://www.pahc.com/-- manufactures  
and markets animal health pharmaceuticals, animal nutrition
products and industrial and fine chemicals.  The company
manufactures and markets more than 550 specialty chemicals and
serve more than 3,500 customers.  Phibro Animal Health Corporation
operates in four business segments: animal health and nutrition,
industrial chemicals, distribution and other.

                          *     *     *

Moody's Investor's Service assigned its 'Caa1' senior subordinate
debt rating on Phibro Animan Health Corporation on July 28, 2006.  
This rating action still holds to date.


PILGRIM'S PRIDE: Cuts Weekly Production by 5% on Soaring Feed Cost
------------------------------------------------------------------
Pilgrim's Pride Corp. plans to reduce weekly chicken processing by
approximately 5% in the second half of fiscal 2008 when compared
to the same period a year ago, as part of its continuing effort to
better balance supply and demand amid record-high costs for feed
ingredients such as corn and soybean meal.

The reduction began with eggs set earlier this month and should
take full effect with weekly processing beginning in June.  The
company said the reduction will remain in effect until average
industry margins return to more normalized levels.  The 5%
reduction includes the impact of the previously stated closing of
the Pilgrim's Pride plant in Siler City, North Carolina, which
should be completed by June.

"Soaring feed-ingredient costs fueled by the federal government's
misguided ethanol policy has created a crisis in our industry, the
true effects of which are only just now beginning to be felt by
American consumers in the form of higher food prices," Clint
Rivers, president and chief executive officer, said.  "Over the
past two weeks, a growing number of smaller chicken producers have
announced production cutbacks in an effort to manage these
unprecedented increases for corn and soybean meal, which are
expected to add billions of dollars of cost to our industry this
year."

"It is clear that chicken producers of all sizes are feeling the
tremendous financial strain from these additional grain costs,"
Mr. Rivers added.  "We have been encouraged by these public
announcements, for they indicate that the production cutbacks this
time are being shared more broadly across the industry, rather
than limited to just the largest processors, as was the case last
year."

"We believe the cuts we are enacting will strike a better balance
between production and demand and strengthen our competitive
position," Mr. Rivers continued.  "As we have said in the past,
reducing overall supply to better match demand is an important
component in helping return the industry to profitability."

The company also said it is continuing to review its production
facilities for potential mix changes, closure and consolidation in
response to current negative industry fundamentals.  Pilgrim's
Pride acknowledged that its processing complex in El Dorado,
Arkansas, is among those being reviewed for possible closure.  But
the company emphasized that no decision has been made at this
time.

                      About Pilgrim's Pride

Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the U.S.,
Mexico and in Puerto Rico.  Pilgrim's Pride employs about 40,000
people and has major operations in Texas, Alabama, Arkansas,
Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania,
Tennessee, Virginia, West Virginia, Mexico and Puerto Rico, with
other facilities in Arizona, Florida, Iowa, Mississippi and Utah.

                         *     *     *

Pilgrim's Pride Corp. holds Moody's Investors Service's
B1 senior unsecured credit rating, B2 senior subordinated notes,
and Ba3 corporate family ratings.  PPC's planned new $250 million
senior unsecured notes also bears Moody's B1 rating and its new
$200 million senior subordinated notes bears Moody's B2 rating.
The outlook on all ratings is stable.  

Standard & Poor's Ratings Services gave Pilgrim's Pride Corp. a
'BB-' corporate credit rating.  


PLY GEM: Weak Housing Industry Prompts S&P's Negative CreditWatch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Ply Gem
Industries Inc., including its 'B' corporate credit rating, on
CreditWatch with negative implications.
      
"The CreditWatch listing reflects our assessment that as a result
of the ongoing weakness in the U.S. housing industry, which we
expect will continue for at least the next several quarters, Ply
Gem's operating performance will continue to be negatively
affected," said Standard & Poor's credit analyst Thomas Nadramia.   
"As a result, we expect earnings will be pressured during this
period, resulting in a material weakening in credit metrics and a
heightened risk that Ply Gem may violate its total leverage
covenant in its credit facility in the near term."
     
The company's total leverage (as measured per the calculation
required in its bank facility) at December 2007 was 5.1x, compared
to the maximum permitted under the covenant of 6.75x.  This
cushion is likely to materially contract in the first half of 2008
given the difficult operating conditions.  In addition, this
covenant steps down to 6.25x at March 2009.
     
In resolving S&P's CreditWatch listing, S&P will review the
company's near-term operating results and financial strategies.  
In addition, S&P will closely monitor the cushion under Ply Gem's
bank covenants and its near- to intermediate-term liquidity
situation.
  

PSI CORP: Engages Seligson & Giannattasio as its Auditors
---------------------------------------------------------
On March 31, 2008, PSI Corp. engaged Seligson & Giannattasio to
become its independent auditor.  

PSI Corp. terminated the services of Rosenberg, Rich, Baker,
Berman & Company as its independent auditor on the same day.

PSI Corp. said it had no disagreements with Rosenberg Rich with
respect to accounting or auditing issues between July 3, 2007, and
March 31, 2008.  The decision to change accountants was approved
by the Board of Directors of the company.

PSI Corp. engaged Rosenberg Rich on July 3, 2007, to audit its
financial statements for the two year period ended Oct. 31, 2007.  
No such audit has been conducted by the accounting firm.

                         About PSI Corp.

Based in Linfield, Pa., PSI Corp. (Pink Sheets: PSCP) provides
interactive customer communications systems and applications that
support the targeted marketing programs at point-of-purchase  
service and information.  The company has two vertical products:
full motion video digital signage and full service Cash Express
Kiosks/ATM.

                          *     *     *

At July 31, 2006, the company's consolidated balance sheet showed
$1,270,779 in total assets and $3,739,471 in total liabilities,
resulting in a $2,468,692 total stockholders' deficit.


QUEBECOR WORLD: Seeks Approval to Hire KPMG (US) as Tax Advisor
---------------------------------------------------------------
Quebecor World Inc. and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
to employ KPMG LLP (US) as their tax compliance and tax consulting
advisors, nunc pro tunc to April 7, 2008.

The Debtors selected KPMG US because of the firm's extensive
experience in providing tax consultation and restructuring
assistance to businesses pursuing reorganization under chapter 11
of the Bankruptcy Code.  The firm is also familiar with the
Debtors' operations and books and records.  KPMG US has been
engaged to provide tax consulting services to the Debtors since
1989.

Under an engagement letter dated March 20, 2008, the Debtors
expect KPMG US to:

   (a) prepare federal, state and local corporate tax returns and
       supporting schedules for 2007;
  
   (b) calculate tax depreciation for the 2007 tax year;

   (c) provide tax consulting advice related to matters not
       otherwise covered by separate engagement letters;

   (d) perform tax compliance and consulting services as agreed;
       and

   (e) provide other services.

A 25-page list of services that KMPG US will provide is available
for free at http://researcharchives.com/t/s?2a67

KPMG US's hourly rates for the tax compliance services are:

        Professional
   (U.S. and Member Firm)                     Hourly Rate
   ----------------------                     -----------
    Partner                                       $400
    Associate Partner/Senior Pricipal             $363
    Tax Managing Director                         $325
    Senior Manager                                $305
    Manager                                       $213
    Senior Tax Associate                          $168
    Tax Associate                                 $138

These rates represent a discount of 25% to 50% from KPMG US's
customary hourly rates.

KPMG US's hourly rates for the tax consulting services are:

         Professional
    (U.S. and Member Firm)                    Hourly Rate
    ----------------------                    -----------
     Partner                                      $505
     Associate Partner/Senior Pricipal            $475
     Tax Managing Director                        $455
     Senior Manager                               $420
     Manager                                      $332
     Senior Tax Associate                         $245
     Tax Associate                                $192

Michael Lawler, a partner at KPMG (US), assures Judge Peck that
his firm is a "disinterested person," as that term is defined in
Section 101(14) of the Bankruptcy Code, as modified by Section
1107(b) of the Bankruptcy Code.

A full-text copy of KPMG US's Engagement Letter is available for
free at:

   http://bankrupt.com/misc/Quebecor_KPMGUSEngagementLetter.pdf

                      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. 12; 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 Court on KPMG (Canada) as Tax Consultant
--------------------------------------------------------------
Quebecor World Inc. and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
Pursuant to Sections 327(a) and 328 of the Bankruptcy Code, the
Debtors seek the Court's authority to employ KPMG LLP (Canada) as
their tax consultants, nunc pro tunc to April 7, 2008.

The Debtors say that KPMG Canada has an extensive familiarity
with their businesses, and has experience and knowledge in the
fields of taxation, accounting, auditing and tax advisory
services for large, sophisticated companies.  KPMG Canada has
been engaged to provide tax consulting services to the Debtors
and their non-debtor affiliates for more than 25 years.

In an engagement letter dated April 8, 2008, as tax consultants
to the Debtors, KPMG Canada is expected to:

   (a) provide consulting services needed by the Debtors in
       connection to a United States Internal Revenue Service
       examination for the 2005, 2006 and 2007 tax years;

   (b) work with the Debtors to resolve the IRS Examination in an
       efficient and timely manner and develop a strategy for
       best handling the IRS Examination;

   (c) assist the Debtors in their dealings with the IRS  
       examination team, meet with members of the IRS examination
       team as necessary, and assist the Debtors in preparing
       submissions in response to inquiries from the IRS; and

   (d) represent the Debtors in connection with any tax appeals
       or participation in an alternative dispute resolution
       program.

KPMG Canada's hourly rates are:

   Professional                    Hourly Rate
   ------------                    -----------
   Partner/Director                    $520
   Senior Principal                    $470
   Senior Manager                      $395
   Manager                             $213
   Tax Associate                       $162

These hourly rates represent a reduction of between 35% to 50%
from KPMG Canada's customary hourly rates.

Before the Petition Date, the Debtors retained KPMG Canada to
undertake work for them on certain tax filings and activities.

Nathalie Bernier, a partner at KPMG LLP (Canada), relates that at
the time the Debtors filed for bankruptcy protection, KPMG Canada
was owed approximately CN$2,400,000 for services rendered to
Quebecor World Inc. and the Debtors' non-debtor affiliates.  As a
result, KPMG Canada is a creditor of QWI in the Canadian
insolvency proceedings.  KPMG Canada also performs services
unrelated to the Debtors and their Chapter 11 cases for
non-debtor QWI affiliates in Europe and Latin America, and is
paid in the ordinary course of business for those services.  In
addition, KPMG Canada incurred approximately CN$600,000 in fees
in connection with prepetition services provided to the Debtors
and QWI, of which approximately CN$100,000 is owed on account of
engagements where one or more of the Debtors were the sole
engaging party.  

Ms. Bernier tells the Court that KPMG Canada has agreed, in
connection with the Debtors' retention of KPMG Canada and with
the Debtors' retention of KPMG LLP (US), that if KPMG Canada's
retention is approved by the Court, KPMG Canada will waive all of
its prepetition claims against the Debtors, whether arising under
engagements where one or more of the Debtors was the sole
engaging party, or under engagements where one or more of the
Debtors signed jointly with certain non-debtor affiliates,
including particularly with QWI.  Where QWI or another non-Debtor
affiliate was a party to a signed engagement letter with KPMG
Canada (even if that engagement letter was signed jointly by a
Debtor), KPMG Canada will seek to collect outstanding amounts
solely from those non-Debtor affiliates, including QWI in the
Canadian Proceeding, Ms. Bernier says.   

In connection with engagements related to U.S. tax services, KPMG
Canada has in the past sub-contracted with KPMG US to perform a
majority of the work for which KPMG Canada was engaged.  KPMG
Canada directly paid KPMG US for these services and payment was
not dependent upon whether the engaging entity(ies) paid KPMG
Canada.  In connection with services performed by KMPG US for
KPMG Canada before the Debtors' bankruptcy cases, KPMG Canada
paid KPMG US approximately $30,000 in the 90-day period prior to
the Petition Date, and KPMG Canada currently owes KPMG US
approximately $380,000 for work performed in connection with
these engagements.  According to Ms. Bernier, KPMG US has agreed,
subject to approval of its and KPMG Canada's retention, not to
collect $100,000 of the amount outstanding from KPMG Canada.

KPMG Canada received $104,630 from the Debtors during the 90-day
period before the Petition Date in the ordinary course of
business.  KPMG Canada paid KPMG US approximately $30,000 of this
amount.

Ms. Bernier assures Judge Peck that her firm is a "disinterested
person," as that term is defined in Section 101(14) of the
Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy
Code.  

A full-text copy of the KMPG Canada's Engagement Letter is
available for free at: http://researcharchives.com/t/s?2a68

                      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. 12; 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 Ernst & Young as Tax Services Provider
------------------------------------------------------------
Quebecor World Inc. and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
to employ Ernst & Young LLP as their tax services provider, nunc
pro tunc to April 7, 2008.

According to the Debtors, E&Y LLP has an extensive experience
providing tax consultation to businesses pursuing reorganization
under chapter 11 of the Bankruptcy Code.

Under the terms set forth in an engagement letter dated March 31,
2008, the Debtors are expecting E&Y LLP to provide:

1. Bankruptcy Tax Services, which entails:

   (a) understanding reorganization and restructuring
       alternatives the Debtors are evaluating;
   
   (b) assisting and advising the Debtors in developing an
       understanding of the tax implications of their bankruptcy   
       restructuring alternatives and post-bankruptcy
       operations;

   (c) assistance with tax issues arising in the ordinary
       course of business while in bankruptcy;

   (d) tax advisory services regarding tax aspects of the
       bankruptcy process;

   (e) analysis of legal and other professional fees incurred
       during the bankruptcy period;

   (f) documentation, as appropriate or necessary, of tax
       analysis, opinions, recommendations, conclusions and
       correspondence;

   (g) advisory services regarding tax analysis and research
       related to acquisitions and divestitures;

   (h) advisory services regarding tax analysis and research
       related to tax-efficient domestic restructurings; and

   (i) tax forecast model.

2. Entity Structure Services, which includes working with the
   Debtors' personnel in developing an efficient U.S. Entity
   structure, taking into account the Debtors' desire for entity
   rationalization, tax efficiency, and impact on the Debtors'
   indirect tax obligations.

3. Loan Staff Services, which includes assigning staff to support
   the activities of the Debtors' employees in completing
   ministerial and administrative tasks relating to the
   preparation of the Debtors' quarterly and annual income taxes,
   the Debtors' U.S. restructuring, and Internal Revenue Service
   and state and local income tax authority audits.

E&Y LLP's hourly rates are:

   (a) Bankruptcy Tax Services and Entity Structure Services

       Professional                             Hourly Rate
       ------------                             -----------
       Executive Director/Principal/Partner      $750
       Senior Manager                            $650
       Manager                                   $550
       Senior                                    $420
       Staff                                     $200 - $300

   (c) Loan Staff Services
       
       Professional                            Hourly Rate
       ------------                            -----------
       Manager                                   $250
       Senior                                    $150
       Staff                                     $120

Pursuant to the Engagement Letter, E&Y LLP may subcontract
certain work in connection with the tax services, in particular
to Ernst & Young LLP, an Ontario Limited Liability Partnership.  

E&Y Canada's hourly rates are:

   (a) Bankruptcy Tax Services and Entity Structure Services
                    
       Professional                            Hourly Rate
       ------------                            -----------
       Partner                                 CA$600
       Executive Director                        $550
       Senior Manager                            $475
       Manager                                   $375
       Senior Tax Staff                          $300
       Tax Staff                                 $200 - $275

   (b) Loan Staff Services

       Professional                            Hourly Rate
       ------------                            -----------
       Manager                                 US$250
       Senior                                    $150
       Staff                                     $120

E&Y LLP also anticipates subcontracting Ernst & Young (India)
Private Limited to assist it in calculations relating to the
determination of and availability of certain tax attributes.  E&Y
LLP will seek reimbursement of fees and expenses incurred by E&Y
(Canada) and EYPL under a subcontracting engagement.  

Upon subcontracting E&Y Canada and EYPL, E&Y LLP will remain
solely responsible for the services and will be the only party to
receive payment from the Debtors.

Lawrence Garret, principal of Ernst & Young LLP, assures Judge
Peck that his firm is a "disinterested person," as that term is
defined in Section 101(14) of the Bankruptcy Code, as modified by
Section 1107(b) of the Bankruptcy Code.

A full-text copy of the E&Y LLP Engagement Letter is available
for free at:

   http://bankrupt.com/misc/Quebecor_E&YLLPEngagementLetter.pdf

                      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. 12; 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.


RAPTOR NETWORKS: Secures $3 Million Financing from Three Investors
------------------------------------------------------------------
Raptor Networks Technology Inc. signed a private placement
transaction with three institutional investors.  The terms of the
transaction, included the issuance of senior secured convertible
notes, warrants, and shares of the company's common stock for
aggregate gross proceeds of $3,125,000.

The notes and warrants will have a per share conversion and
exercise price of $1.  

"We believe this most recent round funding from our existing
institutional investors reflects their continued confidence in
Raptor's superior technology, products, and business outlook,"
Thomas M. Wittenschlaeger, Raptor's chairman and chief executive
officer, stated.  "We plan to use this funding to advance our
business operations to achieve sustainability across multiple
sales verticals."

Headquartered in Santa Ana, California, Raptor Networks Technology
Inc. -- http://raptor-networks.com/-- provides high speed   
ethernet and network switching for information access.

                     Going Concern Doubt

On March 26, 2008, Mendoza Berger & company LLP in Irvine,
California, raised substantial doubt the company's ability to
continue as a going concern after auditing financial results for
year ended Dec. 31, 2007.  The auditor pointed out that the
company has sustained accumulated losses from operations totaling
$70,200,000 at Dec. 31, 2007.   


SAXON ASSET: Fitch Chips Ratings on $354.9 Million Certificates
---------------------------------------------------------------
Fitch Ratings has taken rating actions on three Saxon Asset
Securities Trust mortgage pass-through certificate transactions.  
Unless stated otherwise, any bonds that were previously placed on
Rating Watch Negative are removed.  Affirmations total
$409.8 million and downgrades total $354.9 million.  Break Loss
percentages and Loss Coverage Ratios for each class are included
with the rating actions as:

Series 2005-1
  --$48.7 million class M-1 affirmed at 'AA+'
    (BL: 77.03, LCR: 4.47);

  --$42.0 million class M-2 downgraded to 'A' from 'AA'
    (BL: 32.76, LCR: 1.90);

  --$15.5 million class M-3 downgraded to 'BBB' from 'AA'
    (BL: 29.36, LCR: 1.70);

  --$23.5 million class M-4 downgraded to 'BB' from 'AA-'
    (BL: 23.52, LCR: 1.36);

  --$18.5 million class M-5 downgraded to 'B' from 'A'
    (BL: 19.51, LCR: 1.13);

  --$14.5 million class M-6 downgraded to 'B' from 'A'
    (BL: 17.05, LCR: 0.99);

  --$15.0 million class B-1 downgraded to 'CCC' from 'BBB+'
    (BL: 15.29, LCR: 0.89);

  --$11.5 million class B-2 downgraded to 'CCC' from 'BBB'
    (BL: 14.09, LCR: 0.82);

  --$9.0 million class B-3 downgraded to 'CCC' from 'BBB-'
    (BL: 12.96, LCR: 0.75).

Deal Summary
  --Originators: 100% Saxon Funding Management;
  --60+ day Delinquency: 27.12%;
  --Realized Losses to date (% of Original Balance): 1.08%;
  --Expected Remaining Losses (% of Current balance): 17.25%;
  --Cumulative Expected Losses (% of Original Balance): 4.63%.

Series 2005-2
  --$11.0 million class A-1A affirmed at 'AAA'
    (BL: 95.33, LCR: 4.99);

  --$2.7 million class A-1B affirmed at 'AAA'
    (BL: 93.65, LCR: 4.90);

  --$12.1 million class A-2D affirmed at 'AAA'
    (BL: 93.69, LCR: 4.90);

  --$53.9 million class M-1 affirmed at 'AA+'
    (BL: 73.37, LCR: 3.84);

  --$45.1 million class M-2 affirmed at 'AA'
    (BL: 54.22, LCR: 2.84);

  --$15.7 million class M-3 downgraded to 'BBB' from 'AA'
    (BL: 31.01, LCR: 1.62);

  --$31.9 million class M-4 downgraded to 'B' from 'A+'
    (BL: 22.07, LCR: 1.15);

  --$15.2 million class M-5 downgraded to 'B' from 'A'
    (BL: 18.94, LCR: 0.99);

  --$11.3 million class M-6 downgraded to 'CCC' from 'A'
    (BL: 17.21, LCR: 0.90);

  --$20.1 million class B-1 downgraded to 'CCC' from 'BBB+'
    (BL: 15.06, LCR: 0.79);

  --$9.8 million class B-2 downgraded to 'CC/DR3' from 'BBB'
    (BL: 14.17, LCR: 0.74);

  --$9.8 million class B-3 downgraded to 'CC/DR3' from 'BBB-'
    (BL: 13.24, LCR: 0.69).

Deal Summary
  --Originators: 100% Saxon Funding Management;
  --60+ day Delinquency: 27.62%;
  --Realized Losses to date (% of Original Balance): 0.70%;
  --Expected Remaining Losses (% of Current balance): 19.12%;
  --Cumulative Expected Losses (% of Original Balance): 5.71%.

Series 2005-3
  --$69.0 million class A-1A affirmed at 'AAA'
    (BL: 65.70, LCR: 3.22);

  --$50.3 million class A-2C affirmed at 'AAA'
    (BL: 77.37, LCR: 3.79);

  --$30.7 million class A-2D affirmed at 'AAA'
    (BL: 63.23, LCR: 3.09);

  --$34.2 million class M-1 affirmed at 'AA+'
    (BL: 53.72, LCR: 2.63);

  --$31.5 million class M-2 affirmed at 'AA'
    (BL: 44.81, LCR: 2.19);

  --$20.7 million class M-3 affirmed at 'AA-'
    (BL: 39.29, LCR: 1.92);

  --$16.2 million class M-4 downgraded to 'A' from 'A+'
    (BL: 34.91, LCR: 1.71);

  --$15.8 million class M-5 downgraded to 'BBB' from 'A'
    (BL: 30.68, LCR: 1.50);

  --$13.1 million class M-6 downgraded to 'B' from 'BBB+'
    (BL: 20.48, LCR: 1.00);

  --$14.4 million class B-1 downgraded to 'CCC' from 'BBB-'
    (BL: 17.40, LCR: 0.85);

  --$9.9 million class B-2 downgraded to 'CCC' from 'BB'
    (BL: 16.13, LCR: 0.79);

  --$9.9 million class B-3 downgraded to 'CC/DR3' from 'BB'
    (BL: 15.08, LCR: 0.74);

  --$12.6 million class B-4 downgraded to 'CC/DR3' from 'B'
    (BL: 13.74, LCR: 0.67).

Deal Summary
  --Originators: 100% Saxon Funding Management;
  --60+ day Delinquency: 26.95%;
  --Realized Losses to date (% of Original Balance): 0.72%;
  --Expected Remaining Losses (% of Current balance): 20.43%;
  --Cumulative Expected Losses (% of Original Balance): 8.65%.

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 2005 with regard to continued poor loan performance and
home price weakness.


SCOTTISH RE: A.M. Best Downgrades Ratings and Put It Under Review
-----------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to B-
(Fair) from B(Fair) and the issuer credit ratings to "bb-" from
"bb" of the primary operating insurance subsidiaries of Scottish
Re Group Limited.  A.M. Best also has downgraded the ICR to "ccc+"
from "b-" and the various debt ratings of Scottish Re.  All
ratings have been placed under review with negative implications.

Subsequent to the Feb. 27, 2008 rating downgrades, A.M. Best has
noted a heightened lack of clarity with respect to Scottish Re's
financial strength position, underpinned by continuing
deterioration in the credit markets and the likely further
declines in the market value of its investment portfolio and
assets in various special purpose vehicles.  Scottish Re has twice
postponed the filing of its Form 10-K, primarily due to an
inability to complete the evaluation of mark-to-market valuations
and other temporary impairments in the carrying value of its
available for sale securities.  

The continuing market deterioration in the subprime mortgage loan
market will result in additional delinquencies and losses and
there remains uncertainty surrounding the ultimate impact of
investment write-downs on Scottish Re, its subsidiaries and SPVs
such as Ballantyne Re plc (Ballantyne).  The rating downgrades
also reflect A.M. Best's concerns with the ongoing pricing,
volatility, valuation and default risk in the mortgage-backed
securities market, which could result in an additional negative
impact on the company's consolidated balance sheet.

A.M. Best notes that Scottish Re remains heavily dependent upon
off-shore securitizations for its XXX reserves.  Scottish Re
recently announced a binding letter of intent with ING North
American Insurance Holdings Inc. and its affiliates in which a
pro-rata portion of business ceded to Ballantyne, an orphan
offshore SPV, would be recaptured.  The transaction would allow
Scottish Re (U.S.) Inc. to continue to receive full NAIC reserve
credit for reinsurance for the business currently ceded to
Ballantyne.  Erosion in the value of the large position in
subprime and Alt-A loans held by Ballantyne would further deplete
the capital held within this structure.  If any further deficiency
were to develop, A.M. Best believes that absent the completion of
the ING transaction, Scottish Re's operating subsidiaries would be
required to pledge additional assets to secure reserve credit
outside of the securitization structure.

The company also recently expanded the scope of its strategic
evaluation to include the sale of its core North American
reinsurance business.  A.M. Best views this as a departure from
Scottish Re's previously announced plans to pursue the disposition
of non-core business lines such as its international operations.  
The ratings will remain under review while A.M. Best monitors the
performance of the company's subprime and Alt-A mortgage-backed
portfolios and assesses the impact of the ING transaction and the
revised strategy on Scottish Re's balance sheet.

The FSR has been downgraded to B-(Fair) from B(Fair) and the ICRs
to "bb-" from "bb" for these primary operating subsidiaries of
Scottish Re Group Limited:

  -- Scottish Annuity & Life Insurance Company (Cayman) Ltd.
  -- Scottish Re (U.S.), Inc.
  -- Scottish Re Life Corporation
  -- Scottish Re Limited
  -- Orkney Re, Inc.

The ICR has been downgraded to "ccc+" from "b-" for Scottish Re
Group Limited.

These debt ratings have been downgraded:

Scottish Re Group Limited  --
  -- to "ccc-" from "ccc" on $125 million non-cumulative preferred
     shares

Stingray Pass-Though Trust  --
  -- to "bb-" from "bb" on $325 million 5.902% senior secured
     pass-through certificates, due 2012

These indicative ratings have been downgraded:

Scottish Re Group Limited  --
  -- to "ccc+" from "b-"on senior unsecured debt
  -- to "ccc" from "ccc+" on subordinated debt
  -- to "ccc-" from "ccc" on preferred stock

  -- Scottish Holdings Statutory Trust II and III  --
  -- to "ccc" from "ccc+" on preferred securities


SKYBUS AIRLINES: Seeks Approval of Air Canada Settlement
--------------------------------------------------------
Skybus Airlines Inc. asks the Hon. Christopher S. Sontchi of
the U.S. Bankruptcy Court for the District of Delaware to approve
a settlement agreement dated April 6, 2008 -- including the
rejection of two aircraft sub-lease agreements dated Oct. 5, 2007
-- between the Debtor and Air Canada.

Pursuant to court documents, the settlement agreement enables
the Debtor to eliminate approximately $10 million of claims by Air
Canada.  As part of the agreement, the Debtor will return the two
Airbus A319-100 aircraft that it rented from Air Canada right
after the lease agreements expire.

However, the Debtor say that the aircraft are presently not in the
required "return condition" and it would have to spend about
$400,000 to fix both aircraft.

In addition to the deal, Air Canada may retain the security
deposits in full, all maintenance reserves received under the
terms of the parties' sub-lease agreement and prepetition
unsecured claims.

The Debtor says it has an urgent need to obtain court approval of
the settlement by April 30, 2008.

A hearing is set on April 28, 2008, to consider the Debtor's
request.  Objections, if any, are due April 25, 2008.

A full-text copy of Skybus and Air Canada's Settlement Agreement
is available for free at http://ResearchArchives.com/t/s?2a7f

                     About Skybus Airlines

Headquartered in Columbus, Ohio, Skybus Airlines, Inc., --
http://www.skybus.com/-- operates a domestic airline and had
destinations in 15 cities in the United States.  On April 4, 2008,
it ceased its flights opeartions and grounded all of its
acircrafts.  The company filed for Chapter 11 protection on April
5, 2008 (Bankr. D. Del. Case No.08-10637).   Adam G. Landis, Esq.,
and Matthew B. McGuire, Esq., at Landis Rath & Cobb LLP, represent
the Debtor in its restructuring efforts.  When the Debtor filed
for protection against its creditors, it listed assets between
$100 million and $500 million and debts between $10 million and
$100 million.


SOLUTIA INC: Has 60,766,560 Outstanding Shares as of February 29
----------------------------------------------------------------
As of Feb. 29, 2008, Solutia Inc. had 60,766,560 shares of
common stock outstanding, according to Rosemary L. Klein,
Solutia's senior vice president, general counsel and secretary,
in a regulatory filing with the U.S. Securities and Exchange
Commission.

In addition, Solutia has warrants and options to purchase the
outstanding common stock.

A more detailed description of Solutia's capitalization as of
February 29 is available for free at:

   http://bankrupt.com/misc/Feb29summary.pdf

or through the company's Web site at:

   http://investor.solutia.com/phoenix.zhtml?c=88803&p=irol-IRhome

Ms. Klein notes that some third-party financial information Web
sites appear to be reporting or basing their calculation of
Solutia's capitalization on approximately 104,000,000 shares of
common stock outstanding, which as of February 29, is incorrect.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  Solutia emerged from chapter 11 protection Feb. 28, 2008.  
(Solutia Bankruptcy News, Issue No. 123; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 4, 2008,  
Standard & Poor's Ratings Services raised its corporate credit
rating on Solutia Inc. to 'B+' from 'D', following the company's
emergence from bankruptcy on Feb. 28, 2008, and the implementation
of its financing plan.  The outlook is stable.
     
S&P also affirmed its 'B+' rating and '3' recovery rating on
Solutia's proposed senior secured term loan.  In addition, S&P
assigned its 'B-' rating to Solutia's $400 million unsecured
bridge loan facility.  S&P also withdrew its 'B-' rating on the
proposed $400 million unsecured notes, which have been replaced by
the bridge facility in Solutia's capital structure.


SOLUTIA INC: Settlement Pact with Solvay Gets Court Approval
------------------------------------------------------------
Solutia Inc., and Solvay Advanced Polymers LLC, are parties to a
certain purchase agreement, dated Sept. 1, 2002, as amended,
pursuant to which Solvay purchased adipic acid and
hexamethylenediamine from Solutia.  Solutia relates that the
Purchase Agreement, and its amendments, is still in full force
and effect with respect to the purchase of adipic acid.

On Jan. 1, 2007, Solutia and Solvay entered into a new purchase
agreement for the purchase of HMDA only.  Solvay owes $65,399
under the HMDA Agreement.

The exhibits attached to the Debtors' Fifth Amended Joint Plan of
Reorganization listed the Purchase Agreement as part of the
executory contracts to be assumed.  The Plan also provided that
entry of an order confirming the Plan would constitute approval
of the assumption of the Purchase Agreement, except as to any
unresolved cure objections.  The Plan was confirmed Nov. 29,
2007.

              Settlement Agreement Approved by Court

On Nov. 9, 2007, Solutia sent Solvay a notice to assume the
Purchase Agreement with a proposed cure amount of $0.  Solvay
objected and asserted a postpetition cure amount of $335,718.

Solutia and Solvay have engaged in good-faith, arm's-length
negotiations in an attempt to resolve the dispute.  Judge Beatty
has approved the parties' stipulation, which provides that:

     * The cure amount due under the Purchase Agreement is
       $335,718;

     * Solvay and Solutia will amend the Purchase Agreement;

     * Solvay owes $65,399 to Solutia.  That amount will be set
       off the Cure Amount owed by Solutia, leaving a net balance
       of $270,319 owed by Solutia to Solvay;

     * Upon payment of the Net Cure Amount, the parties will
       exchange releases of claims in connection with th
       assumption of the Purchase Agreement; and

     * Upon payment of the Net Cure Claim, Solutia will have been
       (i) deemed to satisfy all claims that may have been
       asserted by Solvay, and (ii) paid by Solvay in full for
       any amounts due under the HMDA Agreement for the period
       Jan. 1, 2007, through Dec. 1, 2007.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  Solutia emerged from chapter 11 protection Feb. 28, 2008.  
(Solutia Bankruptcy News, Issue No. 123; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 4, 2008,  
Standard & Poor's Ratings Services raised its corporate credit
rating on Solutia Inc. to 'B+' from 'D', following the company's
emergence from bankruptcy on Feb. 28, 2008, and the implementation
of its financing plan.  The outlook is stable.
     
S&P also affirmed its 'B+' rating and '3' recovery rating on
Solutia's proposed senior secured term loan.  In addition, S&P
assigned its 'B-' rating to Solutia's $400 million unsecured
bridge loan facility.  S&P also withdrew its 'B-' rating on the
proposed $400 million unsecured notes, which have been replaced by
the bridge facility in Solutia's capital structure.


SOLUTIA INC: Harbinger Entities Disclose 30.1% Equity Stake
-----------------------------------------------------------
These parties disclosed in a joint Form 4 filing with the U.S.
Securities and Exchange Commission their ownership of Reorganized
Solutia Inc. securities:

     * Harbinger Capital Partners Master Fund I, Ltd. -- Master
       Fund;

     * Harbinger Capital Partners Offshore Manager, L.L.C. --
       Harbinger Management -- the investment manager of the
       Master Fund;

     * HMC Investors, L.L.C., Harbinger Management's managing
       member -- HMC Investors;

     * Harbert Management Corporation -- HMC -- the managing
       member of HMC Investors and the parent of HMCNY;

     * Philip Falcone, a shareholder of HMC and the portfolio
       manager of the Master Fund and Harbinger Capital Partners
       Special Situations Fund, L.P. -- Special Fund;

     * Raymond J. Harbert , a shareholder of HMC; and

     * Michael D. Luce, a shareholder of HMC

The non-derivative securities owned:

          Securities                  Securities
     Acquired / Disposed     Price       Owned      Ownership
     -------------------     -----    ----------    ---------
March 25, 2008 filing:
                 256,400    $12.50    12,095,457       direct
                       0         0    12,095,457     indirect
                  25,000     11.90    12,120,457       direct
                       0         0    12,120,457     indirect
                 160,402     13.62    12,280,859       direct
                       0         0    12,280,859     indirect
                       -         -     6,026,461     indirect

March 26, 2008 filing:
                  45,000     14.30    12,325,859       direct
                       0         0    12,325,859     indirect
                 210,800     14.33    12,536,659       direct
                       0         0    12,536,659     indirect
                       -         -     6,026,461     indirect

The securities, except for the 6,026,461 shares, are indirectly
owned by Master Fund.  These securities may be deemed to be
beneficially owned by Harbinger Management, HMC Investors, HMC,
and Messrs. Falcone, Harbert, and Luce.  

Special Fund indirectly owned 6,026,461 shares.  These securities
may be deemed to be beneficially owned by Harbinger Capital
Partners Special Situations GP, LLC -- HCPSS; HMC-New York, Inc.
-- HMCNY; HMC; and Messrs. Falcone, Harbert and Luce.  HCPSS is
the general partner of the Special Situations Fund.  HMCNY is the
managing member of HCPSS.  HMC wholly owns HMCNY.   

                          *     *     *

In their joint first amendment to Schedule 13D filed with SEC, as
of March 28, 2008, the reporting parties may be deemed to
beneficially own these shares:

     Entity/Person                Shares Owned   % Ownership
     -------------                ------------   -----------
     Master Fund                    12,729,751        21.20%
     Harbinger Management           12,729,751        21.20%
     HMC Investors                  12,729,751        21.20%
     Special Fund                    6,026,461        10.10%
     HCPSS                           6,026,461        10.10%
     HMCNY                           6,026,461        10.105
     HMC                            18,756,212        31.30%
     Mr. Falcone                    18,756,212        31.30%
     Mr. Harbert                    18,756,212        31.30%
     Mr. Luce                       18,756,212        31.30%

According to Mr. William R. Lucas, Jr., on behalf the entities,
no borrowed funds were used to purchase the Shares, other than
any borrowed funds for working capital purposes in the ordinary
course of business.  He adds that the number of outstanding
shares is based on the 59,750,000 shares Solutia reported
outstanding as of Nov. 2, 2007, adjusted for warrants held by
the Reporting Persons.

Mr. Lucas says that there is no material change from the Schedule
13D filed on March 11, 2008.

                        About Solutia Inc.

Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:
SOA-WI) -- http://www.solutia.com/-- and its subsidiaries, engage  
in the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide.

The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949).  When the Debtors filed for protection from their
creditors, they listed $2,854,000,000 in assets and $3,223,000,000
in debts.

Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, as lead bankruptcy counsel, and David A. Warfield,
Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St.
Louis Missouri, as special counsel.  Trumbull Group LLC is the
Debtor's claims and noticing agent.  Daniel H. Golden, Esq., Ira
S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss
Hauer & Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice.  The Official Committee of Retirees of Solutia, Inc., et
al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke,
Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne,
LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E.
Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter
Young & Rediker, LLC, in Birmingham, Alabama.

On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement.  On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan.  The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007.  On Oct. 22, 2007,
the Debtor re-filed a Consensual Plan & Disclosure Statement and
on Nov. 29, 2007, the Court confirmed the Debtors' Consensual
Plan.  Solutia emerged from chapter 11 protection Feb. 28, 2008.  
(Solutia Bankruptcy News, Issue No. 123; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 4, 2008,  
Standard & Poor's Ratings Services raised its corporate credit
rating on Solutia Inc. to 'B+' from 'D', following the company's
emergence from bankruptcy on Feb. 28, 2008, and the implementation
of its financing plan.  The outlook is stable.
     
S&P also affirmed its 'B+' rating and '3' recovery rating on
Solutia's proposed senior secured term loan.  In addition, S&P
assigned its 'B-' rating to Solutia's $400 million unsecured
bridge loan facility.  S&P also withdrew its 'B-' rating on the
proposed $400 million unsecured notes, which have been replaced by
the bridge facility in Solutia's capital structure.


SPANSION INC.: Inks Patent Cross-License Agreement with IBM
-----------------------------------------------------------
On April 7, 2008, Spansion LLC, a wholly owned subsidiary of
Spansion Inc., entered into a patent cross-license agreement with
International Business Machines Corp.

Under the agreement, Spansion Inc. issued 1,607,717 shares of
Spansion Class A common stock, par value $0.001 per share to IBM
on April 7, 2008, and will make two additional five million dollar
payments to IBM, either in cash or Spansion common stock
equivalent to the cash amount at the time of payment, before
March 25, 2010.

All of the shares of the Spansion LLC's common stock issued to IBM
in the transaction were issued in reliance upon the exemption from
registration provided under Section 4(2) of the Securities Act of
1933, as amended.

                        About Spansion Inc.

Headquartered in Sunnyvale, California, Spansion Inc. (NASDAQ:
SPSN) -- http://www.spansion.com/-- designs, develops,    
manufactures, markets and sells flash memory solutions for  
wireless, automotive, networking and consumer electronics
applications.

At Dec. 30, 2007, the company's consolidated balance sheet showed
$3.81 billion in total assets, $2.18 billion in total liabilities,
and $1.63 billion in total stockholders' equity.

                        *     *     *

As reported in the Troubled Company Reporter on Feb. 28, 2008,
Fitch Ratings affirmed Spansion Inc.'s issuer default rating at
'B-' while downgrading these issue-level ratings due to lower
recovery prospects: (i) $175 million senior secured revolving
credit facility due 2010 to 'B/RR3' from 'B+/RR2'; (ii)
$625 million senior secured floating rating notes due 2013 to
'B/RR3' from 'B+/RR2'; (iii) $225 million of 11.25% senior
unsecured notes due 2016 to 'CCC/RR6' from 'CCC+/RR5'; and
(iv) $207 million of 2.25% convertible senior subordinated
debentures due 2016 to 'CCC-/RR6' from 'CCC/RR6'.  The rating
outlook remains negative.  Approximately $1.2 billion of debt is
affected.


SPECIALTY UNDERWRITING: Fitch Cuts Ratings on Five Cert. Classes
----------------------------------------------------------------
Fitch Ratings has rating actions on one Specialty Underwriting and
Residential Finance Trust mortgage pass-through certificate
transaction.  Unless stated otherwise, any bonds that were
previously placed on Rating Watch Negative are removed.  
Affirmations total $64.8 million and downgrades total
$21.6 million.  Break Loss percentages and Loss Coverage Ratios
for each class are included with the rating actions as:

Series 2005-AB1
  -- $23.6 million class A1-B affirmed at 'AAA'
     (BL: 80.58, LCR: 5.44);

  -- $22.3 million class A1-C affirmed at 'AAA'
     (BL: 55.52, LCR: 3.75);

  -- $7.8 million class M-1 affirmed at 'AA+'
     (BL: 45.87, LCR: 3.09);

  -- $11.1 million class M-2 affirmed at 'AA'
     (BL: 32.59, LCR: 2.20);

  -- $6.8 million class M-3 downgraded to 'BBB' from 'A'
     (BL: 24.38, LCR: 1.64);

  -- $4.1 million class M-4 downgraded to 'BB' from 'A-'
     (BL: 19.39, LCR: 1.31);

  -- $4.7 million class B-1 downgraded to 'CCC' from 'BBB+'
     (BL: 13.35, LCR: 0.90);

  -- $3.4 million class B-2 downgraded to 'CC/DR5' from 'BBB-'
     (BL: 8.90, LCR: 0.60);

  -- $2.7 million class B-3 downgraded to 'C/DR6' from 'BB'
     (BL: 7.08, LCR: 0.48).

Deal Summary
  -- Originators: MILA, Inc. (45.60%), Wilmington Finance
     (28.59%);

  -- 60+ day Delinquency: 23.72%;
  -- Realized Losses to date (% of Original Balance): 1.48%;
  -- Expected Remaining Losses (% of Current Balance): 14.82%;
  -- Cumulative Expected Losses (% of Original Balance): 6.22%.

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 2005 with regard to continued poor loan performance and
home price weakness.


STURGIS IRON: Court OKs Getzler Henrich as Financial Advisors
-------------------------------------------------------------
The United States Bankruptcy Court for the Western District of
Michigan approve the application of Sturgis Iron & Metal Co.,
Inc., to employ Getzler Henrich & Associates, LLC as its financial
advisors, nunc pro tunc to the petition date.

The Debtor needs Getzler Henrich's services to enable the company
to execute faithfully its duties as debtor-in-possession and to
develop, propose and consummate a chapter 11 plan.

The Debtor will pay the firm for its legal services in accordance
with customary hourly rates.:

   Principal/Managing Director       $395-$525
   Director/Specialist               $335-$485
   Associate/Paraprofessional        $150-$335

William H. Henrich, the Vice Chairman of Getzler Henrich &
Associates, LLC, attests that his firm represents no other
interests adverse to the Debtor, and that the firm is a
"disinterested person", as defined in Section 101 (14) of the
Bankruptcy Code.

The firm can be reached at:

                    Getzler Henrich & Associates, LLC
                       (ghny@getzlerhenrich.com)
                    295 Madison Avenue
                    New York, NY 10017
                    Tel: (212) 697-2400
                    Fax: (212) 697-4812
                    http://www.getzlerhenrich.com/

Based in Sturgis, Michigan, Sturgis Iron & Metal Co., Inc. sells
ferrous metal scrap & waste in wholesale.  It also manufactures
secondary nonferrous metals, and provides pre-finishing iron or
steel processes services, finishing metal processing services, and
smelting metal services.

The company filed for chapter 11 protection on Apr. 4, 2008
(Bankr. W.D. Mich. Case No. 08-02966).  Jay L. Welford, Esq.,
Judith Greenstone Miller, Esq., Paige Barr, Esq., Paul R. Hage,
Esq. and Richard E. Kruger, Esq., at Jaffe Raitt Heuer & Weiss,
P.C. represent the Debtor in its restructuring efforts.  At the
time of filing, the Debtor listed estimated assets and debts both
between $100 million and $500 million.


STURGIS IRON: Court Approves Dresser Hiring as Special Counsel
--------------------------------------------------------------
The United States Bankruptcy Court for the Western District of
Michigan approve the application of Sturgis Iron & Metal Co.,
Inc., to employ Dresser, Dresser, Haas & Caywood, P.C. as its
special counsel, nunc pro tunc to the petition date.

The Debtor needs Dresser's services to enable the company to
execute faithfully its duties as debtor-in-possession and to
develop, propose and consummate a chapter 11 plan.

The Debtor will pay the firm for its legal services in accordance
with customary hourly rates.

John R. Dresser, Esq., a partner at Dresser, attests that his firm
represents no other interests adverse to the Debtor, and that the
firm is a "disinterested person", as defined in Section 101 (14)
of the Bankruptcy Code.

The firm can be reached at:

                    John R. Dresser, Esq.
                       (jdresser@dresserlaw.com)
                    112 South Monroe Street
                    Sturgis, MI 49091
                    Tel: (269) 651-3281
                    Fax: (269) 651-3261
                    http://www.dresserlaw.com/

Based in Sturgis, Michigan, Sturgis Iron & Metal Co., Inc. sells
ferrous metal scrap & waste in wholesale.  It also manufactures
secondary nonferrous metals, and provides pre-finishing iron or
steel processes services, finishing metal processing services, and
smelting metal services.

The company filed for chapter 11 protection on Apr. 4, 2008
(Bankr. W.D. Mich. Case No. 08-02966).  Jay L. Welford, Esq.,
Judith Greenstone Miller, Esq., Paige Barr, Esq., Paul R. Hage,
Esq. and Richard E. Kruger, Esq., at Jaffe Raitt Heuer & Weiss,
P.C. represent the Debtor in its restructuring efforts.  At the
time of filing, the Debtor listed estimated assets and debts both
between $100 million and $500 million.


TAHERA DIAMOND: Last Day of Filing Bids for Assets is April 28
--------------------------------------------------------------
Tahera Diamond Corporation initiated a marketing process of the
assets of the company as approved by the Ontario Superior Court of
Justice. Interested parties must submit written expressions of
interest by no later than April 28, 2008.

Blair Franklin Capital Partners has been retained to manage and
provide guidance during the marketing process.

                       About Tahera Diamond

Tahera Diamond Corporation (TSX: TAH) -- http://www.tahera.com/--
is a Canadian owned diamond mining company.  Tahera's wholly-owned
Jericho project, commencing commercial production in early 2006,
represents Canada's third, and Nunavut's first, diamond mine.

On Jan. 16, 2008, Tahera obtained an order from the Ontario
Superior Court of Justice granting Tahera and its subsidiary
protection pursuant to the provisions of the CCAA.  Tahera sought
protection under CCAA, as its current cash flows and cash on hand
would not allow it to meet its current obligations and its
obligations with respect to the 2008 winter road resupply.  The
Court extended until June 30, 2008, the stay it granted to Tahera
under the Companies' Creditors Arrangement Act.


TAHERA DIAMOND: Wants MCTO Imposed; Gives Operational Update
------------------------------------------------------------
Tahera Diamond Corporation intends to satisfy alternative
information guidelines recommended by Ontario Securities
Commission Policy 57-603 and Canadian Securities Administrators
Staff Notice 57-301.

The company requested from the OSC, that a management cease trade
order related to the company's securities be imposed against some
or all persons who have been directors, officers or insiders of
the company since Sept. 30, 2007.  After consideration of Tahera's
request, the OSC indicated it would not issue a MCTO at this point
in time.

The OSC requested that Tahera provide bi-weekly up-dates by way of
news release, in accordance with the alterative information
guidelines under Policy 57-603 and Staff Notice 57-301.

This report constitutes the first bi-weekly up-date of the company
under the alternative information guidelines.

                        Operational Update

The total number of dry tonnes processed during the fourth quarter
of 2007 was 155,000 tonnes at an average grade of 0.79 carats per
tonne, resulting in carat production of 122,500 carats compared
with 127,500 tonnes at an average grade of 0.78 carats per tonne
for carat production of 99,300 carats for the third quarter of
2007.  The value of production for the fourth quarter of 2007,
based on values of the Government Diamond Valuators, was $11.6
million, compared with $8.4 million in the third quarter of 2007.
The cash operating cost related to the production of these goods
was CA$18.3 million for the fourth quarter of 2007 compared with
CA$17.9 million for the third quarter.  These costs include all
mining, processing and related overhead charges for the quarter.
Certain of the cash items consumed during these periods were
purchased and paid for in a prior period.

The company has held two valuations for goods produced in 2008.
Production from Jan. 1, 2008, to Feb. 5, 2008, yielded 45,026
carats at an average value of $95.32 per carat for a total value
of $4.3 million.  Production from Feb. 6, 2008, to March 12, 2008
included two parcels of goods.  Normal run of mine production
totalled 31,271 carats at an average value of $106.96 per carat
and a batch test of the F1N lobe yielded 2,768 carats at an
average value of $87.80 per carat.  The combined total for the
two parcels from the March valuation was 34,039 carats at an
average value of $105.40 per carat for total value of $3.6
million.

Mining was suspended at the Jericho mine on Feb. 6, 2008, to
conserve cash and fuel inventory while restructuring efforts
continued.  Processing of ore is now expected to continue until
the end of the third week of April 2008.  Mining contractors  have
now demobilized their equipment, supplies, and personnel. The
company has purchased certain items required for the Care &
Maintenance period, which is expected to begin shortly after
production is completed as the mine site assets are properly
prepared for a period of inactivity.

                        About Tahera Diamond

Tahera Diamond Corporation (TSX: TAH) -- http://www.tahera.com/--
is a Canadian owned diamond mining company.  Tahera's wholly-owned
Jericho project, commencing commercial production in early 2006,
represents Canada's third, and Nunavut's first, diamond mine.

On Jan. 16, 2008, Tahera obtained an order from the Ontario
Superior Court of Justice granting Tahera and its subsidiary
protection pursuant to the provisions of the CCAA.  Tahera sought
protection under CCAA, as its current cash flows and cash on hand
would not allow it to meet its current obligations and its
obligations with respect to the 2008 winter road resupply.  The
Court extended until June 30, 2008, the stay it granted to Tahera
under the Companies' Creditors Arrangement Act.


TEKNI-PLEX INC: Inks Restructuring Pact with Key Stakeholders
-------------------------------------------------------------
Tekni-Plex Inc. entered into a restructuring agreement with:

    (i) entities that have represented that they hold more than
        91% of the company's 12.75% Senior Subordinated Notes
        Due 2010 and more than 67% of the company's 8.75% Senior
        Secured Notes due 2013,

   (ii) holders of a majority of the company's preferred stock,

  (iii) holders of 100% of its common stock, and

   (iv) Dr. F. Patrick Smith, Chairman, Chief Executive Officer
        and President of Tekni-Plex.

The agreement memorializes the restructuring terms that were
agreed to in principle by certain stakeholders on March 27, 2008.

The restructuring agreement obligates each party to take actions
reasonably necessary to negotiate, document and consummate the
restructuring on the agreed-upon terms and conditions, which
include:

   -- general unsecured creditors of Tekni-Plex, including trade
      creditors, will be unaffected by the restructuring, and
      the company intends to honor its obligations to those
      creditors in the ordinary course of business,

   -- the company will continue to honor its obligations under
      its $110 million credit facility, its 10.875% Senior
      Secured Notes due 2012 and its Second Lien Notes,

   -- the company's existing common stock will be cancelled,
      redeemed or purchased, and each holder will receive its
      pro rata share of a cash distribution of $250,000,

   -- the company's preferred stock will be exchanged or
      redeemed for three tranches of warrants to purchase 12.5%
      of the company at various exercise prices,

   -- holders of at least 95% of the Subordinated Notes will
      exchange their notes for 100% of the common stock of
      Tekni-Plex, subject to dilution by a management incentive
      plan and the exercise of the warrants,

   -- the obligations of the parties to consummate the
      restructuring is subject to certain conditions, such as:

         (a) obtaining consent to the restructuring from holders
             of not less than (i) 99.5% of the preferred stock,
             (ii) 100% of the common stock, (iii) 85% of the
             indirect interests in the common stock (based on
             unit holdings of the limited liability companies
             that hold the common stock) and (iv) 95% of the
             Subordinated Notes,

         (b) definitive documentation must be reasonably
             satisfactory to the parties, and

         (c) consummation of the restructuring must occur on or
             before May 13, 2008.

Tekni-Plex intends to implement the restructuring by May 13, 2008,
at which point, if the transactions are satisfactory to each of
the lenders under the company's revolving credit facility, the
maximum availability under the credit facility will be increased
from $95 million to $110 million.

There can be no assurance that the parties will be able to
consummate the restructuring as contemplated by their agreement.

Dr. F. Patrick Smith said: "The execution of this agreement
represents a significant step towards the consummation of the
company's restructuring, which will significantly deleverage our
balance sheet and put the company in a strong financial position
to operate and grow its businesses, many of which are leaders in
the markets they serve.  I once again applaud the efforts of those
stakeholders who have demonstrated confidence in Tekni-Plex and
have continued to work tirelessly towards the consummation of the
restructuring.  We fully intend to continue to meet our
obligations to our customers and suppliers, and we appreciate
their ongoing support."

The restructuring will constitute a "Change in Control" under the
Indenture governing the company's 10.875% Senor Secured Notes due
2012, which will require that the company make, after consummation
of the restructuring, an offer to repurchase the First Lien Notes
at a price of 101% plus accrued interest.  The restructuring
agreement provides that if the restructuring is consummated,
certain holders of Subordinated Notes will provide a take-out
facility or tender process to replace, redeem or repurchase, as
necessary, First Lien Notes that are tendered in connection with
the occurrence of the Change in Control.  The restructuring will
not constitute a Change of Control under the Indenture governing
the Second Lien Notes or the Indenture governing the Subordinated
Notes as a result of amendments and waivers (as described in the
company's Form 8-K filed on Feb. 21, 2008).

             Agreement in Principle with Noteholders

As reported in the Troubled Company Reporter on April 3, 2008,
Tekni-Plex Inc. reached an agreement in principle among
the holders of a majority of its 12.75% Senior Subordinated Notes
Due 2010 and the holders of a majority of its preferred stock
regarding the terms of a consensual out-of-court restructuring
transaction, according to the company's regulatory filing with the
Securities and Exchange Commission.

The company also has entered into an extension, through May 13,
2008, of its Forbearance Agreement, dated as of Jan. 16, 2008,
with entities that purportedly hold more than 91% of the
Subordinated Notes and more than 64% of its 8.75% Senior Secured
Notes due 2013.

                        About Tekni-Plex

Headquartered in Coppell, Texas, Tekni-Plex Inc. --
http://www.tekni-plex.com/-- manufactures packaging, packaging  
products and materials as well as tubing products.  The company
primarily serves the food, healthcare and consumer markets.  It
has built leadership positions in its core markets, and focuses on
vertically integrated production of highly specialized products.
Tekni-Plex has operations in the United States, Europe, China,
Argentina and Canada.

As reported in the Troubled Company Reporter on Feb. 22, 2008,
Tekni-Plex Inc.'s consolidated balance sheet at Dec. 28, 2007,
showed $605.7 million in total assets and $1.01 billion in total
liabilities, resulting in a $403.4 million total stockholders'
deficit.

                           *    *    *

As reported in the Troubled Company Reporter on Dec. 27, 2007,
Moody's Investors Service downgraded the Corporate Family Ratings
of Tekni-Plex Inc. to Caa3 from Caa1.


TIENDAS DONATO: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Tiendas Donato, Inc.
             P.O. BOX 13346
             San Juan, PR 00908

Bankruptcy Case No.: 08-02127

Debtor-affiliates filing separate Chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
        Donato Fernandez, Inc.                     08-02130
        D. Fernandez e Hijos, Inc.                 08-02137
        Donato's Management Corp.                  08-02139
        Tiendas Donato Ponce, Inc.                 08-02140

Chapter 11 Petition Date: April 8, 2008

Court: District of Puerto Rico (Old San Juan)

Debtors' Counsel: Charles Alfred Cuprill, Esq.
                     (cacuprill@aol.com)
                  356 Calle Fortaleza, Second Floor
                  San Juan, PR 00901
                  Tel: (787) 977-0515

Tiendas Donato, Inc's Financial Condition:

Total Assets:        $0

Total Debts: $3,204,046

A. Tiendas Donato, Inc's Ten Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Banco Santander Puerto Rico    loan                  $3,062,908
P.O. Box 191080
San Juan, PR 0919-1080

Plaza las Americas             Rent Plaza Las        $54,733
P.O. Box 363268                Americas Store                        
San Juan, PR 00936-3268

FOM Puerto Rico/Ron Simking Be rent for Beltz Outlet $34,381
Ron Simkin Belz Enterprises    store
P.O. Box 3361
Memphis, TN 38173-0661

Centro Gran Caribe             rent Bahia Tropical   $23,579
                               (vega alta)

DDR Rexville, LLC              rent Rexville Plaza   $18,182
                               store

TSCPR Family                   rent manati store     $9,342

Martin, Odell & Calabria       legal services        $444

Xtra Cool Air Conditioning     maintenance servicee  $295

ANtilles Electronics           supplies              $106

Tony Iron Work                 repairs and           $75
                               maintenance

B. Donato Fernandez, Inc's Three Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Banco Santander Puerto Rico    loan                  $3,062,908
P.O. Box 191080
San Juan, PR 0919-1080

Royal Finance, Inc.            insurance policies    $86,714
P.O. Box 9718
San Juan, PR 00908

Xtra Cool Air Conditioning     air conditioning      $109
P.M.B. 212                     service & maintenance
P.O. Box 11850
San Juan, PR 00920

C. D. Fernandez e Hijos, Inc's Three Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Banco Santander Puerto Rico    loan                  $2,514,914
P.O. Box 191080
San Juan, PR 0919-1080

Donato Fernandez Fernandez     rent                  $700
P.O. Box 13346
San Juan, PR 00908

Xtra Cool Air Conditioning     air conditioning      $167
P.M.B. 212                     service & maintenance
P.O. Box 11850
San Juan, PR 00920

D. Donato's Management Corp's 12 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Banco Santander Puerto Rico    loan                  $2,514,914
P.O. Box 191080
San Juan, PR 0919-1080

Jet Printing                   supplies              $2,891
P.O. Box 14155
San Juan, PR 00916

Wise Systems                   supplies              $2,422
P.O. Box 191793
San Juan, PR 00919

Mr. Diesel                     truck repairs         $1,968

American Ribbons               supplies              $724

Taller Guerra                  truct repairs         $323

Offic Discount                 office supplies       $80

Nelson Benitez                 exterminating         $80
                               services

Business Computers             computer maintenance  $75
                               services

ATT Wireless                   mobile phone          $53
                               equipment

ANTilles Electronics           electrical            $48
                               maintenance & repairs

CC Reciclaje del Norte         recycling services    $30

E. Tiendas Donato Ponce, Inc's Two Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Banco Santander Puerto Rico    loan                  $2,514,914
P.O. Box 191080
San Juan, PR 0919-1080

Glorialma Realty Corp.         rent Ponce store      $35,000


ULTRAPETROL LTD: Moody's Holds 'B2' CF Rating on $180 Mil. Notes
----------------------------------------------------------------
Moody's Investors Service has affirmed the B2 corporate family
rating and the B2 rating on the $180 million 9% guaranteed first
mortgage notes due 2014 of Ultrapetrol (Bahamas) Limited.  The
outlook remains stable.

The affirmation reflects the likelihood of strong earnings and
operational cash flow growth over the next 18 months against a
large capital spending program underway, an adequate liquidity
profile, and the company's recently announced $50 million share
repurchase program.  Moody's anticipates that Ultrapetrol's use of
forward freight agreement derivative contracts in the company's
Ocean segment will materially boost day rates earned on three of
the company's chartered oil-bulk-ore vessels above the 2007
levels, which will help boost overall earnings.  The higher
earnings will be required to supplement Ultrapetrol's December
2007 unrestricted cash balance of $64 million as the company plans
capital spending of $250 million over 2008-2009, with $111 million
of that 2008-2009 spending committed, in addition to the share
repurchase program.

The stable outlook reflects Moody's view that day rates on the
company's Ocean time charter business will remain strong into 2009
while margins in the company's other segments will not deteriorate
and debt financing, to help meet vessel payments, will soon be
forthcoming.  The stable outlook contemplates that the company's
liquidity profile will remain adequate over 2008-2009 despite the
capital spending program and share repurchase plans.  Since the
company possesses only a $10 million committed revolving credit
facility in addition to the $64 million unrestricted cash to
supplement internal cash flow generation, without new committed
borrowings near term, the liquidity profile would weaken in coming
months, pressuring the ratings or outlook.

Ultrapetrol (Bahamas) Limited, Bahamian corporation headquartered
in Nassau, Bahamas, is a diverse international marine
transportation company.  The company operates in four segments:
River, Ocean, Offshore Platform Supply and Passenger and had 2007
revenues of $221.7 million.


VIDEOTRON LTD: Prices $455 Mil. Notes Offering; Amends Facility
---------------------------------------------------------------
Videotron Ltd. disclosed the pricing of its offering of
$455 million aggregate principal amount of senior notes.  The new
senior notes will be sold at a price of 98.432% of par, will carry
a coupon of 9% and will mature on April 15, 2018.
  
Videotron intends to use the proceeds of this offering to repay
drawings under its senior secured credit facility and for general
corporate purposes.

Videotron also entered into amendments to its senior secured
credit facility pursuant to which commitments under the senior
secured credit facility have been increased to $575.0 million and
the maturity of the facility has been extended to April 2012.   
Pursuant to these amendments, Videotron will, subject to certain
conditions, also be able to increase the commitments under the
senior secured credit facility by an additional $75.0 million, for
aggregate commitments of $650.0 million.

                          About Videotron

Headquaretred in Montreal,Quebec, Quebecor Media --
http://www.quebecor.com-- is the media arm of Montreal-based  
holding company Quebecor Inc.  Its core Videotron cable division
is the largest cable operator in the province of Quebec and among
the leading providers in Canada.  Videotron serves pay television
to more than 2 million homes and offers other services including
Internet access and computer telephony.  Through Sun Media,
Quebecor Media also operates eight metropolitan newspapers, over
12 million combined weekly circulation, including Le Journal de
Quebec and The Toronto Sun.  The company also broadcasts French-
language television programs; publishes books and magazines; and
provides IT and Web consulting services.

                          *     *     *


As reported in the Troubled Company Reporter on Apr. 11, 2008,
Moody's Investors Service rated Videotron Ltee's $350 million
senior unsecured note issue Ba2.  Videotron is a wholly-owned
subsidiary of Quebecor Media Inc., a diversified media company
whose corporate family rating is Ba3.  As part of the rating
action, QMI's CFR was affirmed along with the prevailing stable
outlook.  In addition, a speculative grade liquidity rating of
SGL-3, indicating adequate liquidity, was assigned.


WACHOVIA CORP: Selling $7 Billion Common, Preferred Stocks
----------------------------------------------------------
Wachovia Corp. commenced concurrent offerings of common stock and
Non-Cumulative Perpetual Convertible Class A preferred stock,
Series L, with a liquidation preference of $1,000 per share, for
an aggregate of $7 billion.  The completion of either offering is
not conditioned on the success of the other.  Wachovia Corporation
also expects to grant the underwriters for the offerings an over-
allotment option to purchase additional shares of the common stock
and an over-allotment option to purchase additional shares of the
convertible preferred stock.  The offerings are being conducted as
public offerings registered under the Securities Act of 1933, as
amended.

"We are taking appropriate and prudent actions to further enhance
our capital position in response to unprecedented economic
conditions," said Ken Thompson, Wachovia's chairman and chief
executive officer. "These actions will significantly increase our
capital ratios, and enhance our ongoing financial flexibility.
We're extremely pleased with the strong expressions of interest
we've already received regarding these issuances, which
demonstrate the confidence of investors in our fundamental
strengths and long-term outlook."

The convertible preferred stock will be convertible into shares of
Wachovia Corporation's common stock, plus cash in lieu of
fractional shares. The non-cumulative dividend rate, conversion
rate and other terms will be determined by negotiations between
Wachovia Corporation and the underwriters of the convertible
preferred stock offering. An application will be made to list the
convertible preferred stock on the New York Stock Exchange under
the symbol "WBPrL."

        Pricing of Common and Convertible Preferred Stock

On the same day that it announced the concurrent offerings of $3.5
billion or 145,833,334 shares of common stock and $3.5 billion or
3,500,000 shares of Non-Cumulative Perpetual Convertible Class A
preferred stock, Series L, Wachovia announced the pricing of the
offerings.

Wachovia Corporation has also granted the underwriters for the
offerings an over-allotment option to purchase up to 21,875,000
additional shares of the common stock and an over-allotment option
to purchase up to 525,000 additional shares of the convertible
preferred stock.  The offerings are being conducted as public
offerings registered under the Securities Act of 1933, as amended.

The common stock offering was priced at $24.00 per share. Wachovia
Corporation estimates that the net proceeds from the common stock
offering will be approximately $3.4 billion, after deducting
underwriting commissions (or approximately $3.9 billion, if the
underwriters exercise their over-allotment option to purchase
additional shares of common stock in full).

The convertible preferred stock will pay, only if, as and when
declared by Wachovia Corporation's board of directors, cash
dividends on each March 15, June 15, September 15 and December 15,
beginning on June 15, 2008, at a rate per annum equal to 7.50%,
payable quarterly in arrears on a non-cumulative basis.

Each share of convertible preferred stock will be convertible at
any time, at the holder's option, into 32.0513 shares of Wachovia
Corporation's common stock, plus cash in lieu of fractional shares
(equivalent to an initial conversion price of approximately $31.20
per share of Wachovia Corporation's common stock).  The conversion
rate will be subject to customary anti-dilution adjustments and
will also be adjusted upon the occurrence of certain other events.  
In addition, on or after March 15, 2013, Wachovia Corporation may
cause some or all of the convertible preferred stock to convert
provided that Wachovia Corporation's common stock has a closing
sale price exceeding 130% of the applicable conversion price for
20 trading days within any period of 30 consecutive trading days.

Wachovia Corporation estimates that the net proceeds from the
convertible preferred stock offering will be approximately $3.4
billion, after deducting underwriting commissions (or
approximately $3.9 billion, if the underwriters exercise their
over-allotment option to purchase additional shares of convertible
preferred stock in full).

"We're gratified by the significant oversubscription led by strong
support from our existing investors for the equity capital
offerings that Wachovia issued today," said Mr. Thompson. "This
issuance was a prudent response to unprecedented economic
conditions, and will sharply increase our capital ratios.  With
fortified capital and our strong deposit base, we believe we're
well-positioned to continue to successfully weather this uniquely
challenging period."

Wachovia Corporation intends to use the net proceeds from the sale
of the common stock and the convertible preferred stock for
general corporate purposes.

Wachovia Securities is serving as global coordinator and joint
bookrunning manager and Goldman, Sachs & Co. is serving as joint
bookrunning manager of these offerings. The offerings will be made
under Wachovia Corporation's shelf registration statement filed
with the Securities and Exchange Commission.

Any offer of securities will be made by means of the prospectus
supplement and accompanying prospectus relating to each offering.
When available, copies of the prospectus supplement and
accompanying prospectus relating to each offering can be obtained
by contacting:

          Wachovia Securities
          Attn: Equity Syndicate
          375 Park Avenue, New York
          New York 10152-4077
          E-mail: equity.syndicate@wachovia.com

               -- or --

         Goldman, Sachs & Co.
         Attn: Prospectus Dept.
         85 Broad St., New York, NY 10004
         Fax: 212 902 9316
         E-mail: prospectus-ny@ny.email.gs.com.

                      About Wachovia Corp.

Based in Charlotte, North Carolina, Wachovia Corporation (NYSE:WB)
-- http://www.wachovia.com/-- is the fifth-largest U.S. bank in   
stock-market value.  It is one of the nation's largest diversified
financial services companies, with assets of $782.9 billion and
market capitalization of $75.3 billion at December 31, 2007.

Wachovia provides a broad range of retail banking and brokerage,
asset and wealth management, and corporate and investment banking
products and services to 15 million customers through 3,400 retail
financial centers in 21 states from Connecticut to Florida and
west to Texas and California, and nationwide retail brokerage,
mortgage lending, student lending and auto finance businesses.
Globally, clients are served in selected corporate and
institutional sectors and through more than 40 international
offices.  Its retail brokerage operations under the Wachovia
Securities brand name manage more than $1.2 trillion in client
assets through 14,600 financial advisors in 1,500 locations
nationwide.  Online banking is available at http://wachovia.com;  
online brokerage products and services at http://wachoviasec.com;  
and investment products and services at
http://evergreeninvestments.com.

                           *     *     *

As reported by the Troubled Company Reporter on April 14, 2008,
The Walls Street Journal noted that Wachovia's need for additional
capital came two months after it raised $3.5 billion through a
preferred-stock sale.  According to the report, Wachovia's trouble
stemmed from its $25 billion purchase of Golden West Financial
Corp. nearly two years ago.  Golden West's loans -- the vast
majority of which are adjustable-rate mortgages loans -- were
concentrated in California, one of the hardest-hit housing markets
in the U.S.  Today, Wachovia announced that it lost $350 million
in the first quarter due to $2 billion in asset write-downs and
$2.1 billion in new provisions against credit losses.  Earnings in
the same period last year was $2.3 billion.


WACHOVIA CORP: Posts Net Loss of $350MM for Q1; To Cut Dividends
----------------------------------------------------------------
Wachovia Corp. is planning on a series of actions to further
enhance its capital base and operational flexibility, and updated
its credit reserve modeling to reflect greater emphasis on
forecasted changes in customer behavior assuming continued house
price depreciation. These actions include:

     -- Plans to raise capital through a public offering of common
        stock and perpetual convertible preferred stock;

     -- Lowering the quarterly common stock dividend, which
        preserves $2.0 billion of capital annually, to build
        capital ratios and provide more operational flexibility.

The board of directors declared a quarterly common stock dividend
of $0.375 cents per common share, payable on June 16, 2008, to
stockholders of record on May 30, 2008. This dividend level is
consistent with Wachovia's capital needs and growth opportunities
for each of its business segments, and with an anticipated 40
percent to 50 percent cash payout ratio over the intermediate
horizon; and

     -- The update in the credit reserve modeling in response to
        the current and forecasted market environment and its
        effect on consumer behavior, particularly in stressed
        markets, resulting in a significant increase in the first
        quarter 2008 provision for credit losses. In addition, the
        scope of credit disclosures was increased to provide
        enhanced insight into the payment option consumer real
        estate portfolio.

In addition, Wachovia reported a first quarter 2008 net loss of
$350 million before preferred dividends, or a net loss available
to common stockholders of $393 million, (20 cents per common
share). These results, which reflect higher credit costs and the
continued disruption in the capital markets, compared with
earnings of $2.30 billion, or $1.20 per share, in the first
quarter of 2007.

While solid underlying performance was overshadowed by market
disruption-related valuation losses of $2.0 billion, Wachovia
generated total revenue of $7.9 billion on higher loans and
deposits and strength in fiduciary and asset management fees,
brokerage commissions and traditional banking fees, including the
impact of the A.G. Edwards acquisition.

"I'm deeply disappointed with our first quarter results, but I am
confident we're taking prudent and appropriate actions in this
challenging period to restore Wachovia to a more profitable path.
The precipitous decline in housing market conditions and
unprecedented changes in consumer behavior prompted us to update
our credit reserve modeling and rely less heavily on historical
trends to forecast losses. As a result, we have substantially
increased our reserves," said Ken Thompson, Wachovia's chief
executive officer.

"The most painful decision was to reduce the dividend because it
adversely affects our shareholders. But we believe the long-term
benefit to shareholder value outweighs the disadvantage of the
dividend reduction as we fortify our balance sheet against
continued instability in the housing and capital markets.

"It's important to note that in early 2007 in advance of the
market dislocation, we took steps to bolster our liquidity and
reduce market-related exposures in products originally intended
for distribution," Mr. Thompson added. "We have generally been a
provider of liquidity to the market during this period of market
disruption, and we also continue to reduce our market-related
exposures. The actions we announced today will further enhance and
ensure our ongoing financial flexibility to invest and drive
future earnings growth. With strengthened reserves and capital,
and our strong deposit base, we believe we're well-positioned to
continue to successfully weather this uniquely challenging
period."

Based in Charlotte, North Carolina, Wachovia Corporation (NYSE:WB)
-- http://www.wachovia.com/-- is the fifth-largest U.S. bank in   
stock-market value.  It is one of the nation's largest diversified
financial services companies, with assets of $782.9 billion and
market capitalization of $75.3 billion at December 31, 2007.

Wachovia provides a broad range of retail banking and brokerage,
asset and wealth management, and corporate and investment banking
products and services to 15 million customers through 3,400 retail
financial centers in 21 states from Connecticut to Florida and
west to Texas and California, and nationwide retail brokerage,
mortgage lending, student lending and auto finance businesses.
Globally, clients are served in selected corporate and
institutional sectors and through more than 40 international
offices.  Its retail brokerage operations under the Wachovia
Securities brand name manage more than $1.2 trillion in client
assets through 14,600 financial advisors in 1,500 locations
nationwide.  Online banking is available at http://wachovia.com;  
online brokerage products and services at http://wachoviasec.com;  
and investment products and services at
http://evergreeninvestments.com.

                         *     *     *

As reported by the Troubled Company Reporter on April 14, 2008,
The Walls Street Journal noted that Wachovia's need for additional
capital came two months after it raised $3.5 billion through a
preferred-stock sale.  According to the report, Wachovia's trouble
stemmed from its $25 billion purchase of Golden West Financial
Corp. nearly two years ago.  Golden West's loans -- the vast
majority of which are adjustable-rate mortgages loans -- were
concentrated in California, one of the hardest-hit housing markets
in the U.S.  Today, Wachovia announced that it lost $350 million
in the first quarter due to $2 billion in asset write-downs and
$2.1 billion in new provisions against credit losses.  Earnings in
the same period last year was $2.3 billion.


WACHOVIA BANK: S&P Upgrades Ratings on Two Classes From Low-Bs
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on nine
classes of commercial mortgage pass-through certificates from
Wachovia Bank Commercial Mortgage Trust's series 2002-C1.   
Concurrently, S&P affirmed its ratings on the remaining eight
classes from this transaction.
     
The raised ratings reflect increased credit support due to
principal paydowns and loan amortization, as well as the
defeasance of $173.2 million (23%) of the pool.  The affirmed
ratings reflect credit enhancement that provides adequate support
through various stress scenarios.
     
As of the March 17, 2008, remittance report, the collateral pool
consisted of 140 loans with an aggregate principal balance of
$769.1 million, compared with 156 loans totaling $950.0 million at
issuance.  The master servicer, Wachovia Bank N.A., reported
financial information for 85.4% of the nondefeased loans.  The
servicer provided full-year 2006, full-year 2007, and interim-2007
financial data.  Based on this information, Standard & Poor's
calculated a weighted average debt service coverage of 1.53x, up
from 1.33x at issuance.  All of the loans in the pool are current.  
There are no loans with the special servicer.  To date, the trust
has experienced only two losses totaling $59,519.
     
The top 10 loan exposures have an aggregate outstanding balance of
$151.4 million (19.7%).  As of year-end 2006 and interim- and
year-end 2007, the weighted average DSC for the top 10 loan
exposures was 1.43x, up from 1.28x at issuance.  This calculation
excludes the 10th-largest loan.  The loan was assumed in November
2007, and the new borrower has not yet provided the master
servicer with financial statements.  The eighth-largest loan
appears on the watchlist.  Standard & Poor's reviewed property
inspections provided by Wachovia for the collateral securing the
top 10 loan exposures, and all were characterized as "good."
     
Wachovia reported a watchlist of 22 loans with an aggregate
outstanding balance of $99.3 million (12.9%).  The largest loan on
the watchlist and eighth-largest loan in the pool, the Dana Corp.
-- Antioch loan ($13.2 million, 2%), is on the watchlist due to
low occupancy.  Its sole tenant, Dana Corp., declared bankruptcy
in 2006. Dana subsequently vacated its space, and 50% of the
property has been leased up.  As of Sept. 30, 2007, the reported
DSC was 0.57x. In addition, there are two loans also of concern
that appear on the watchlist.  The Dana Corp. -- Rochester Hills
loan ($7.9 million, 1%) is on the watchlist due to Dana Corp.'s
bankruptcy.  The borrower for this loan is not related to the
borrower of the Dana Corp. -- Antioch loan.  Occupancy is
currently 100%.  No recent financial information was provided for
this loan.   
The Avalon Square Apartments loan ($10.9 million, 1%), a 220-unit
multifamily property located in Houston, Texas, is a concern.  As
of the period ended Nov. 30, 2007, the reported DSC was 1.07x.  
The remaining loans that appear on the watchlist are due to low
DSC and low occupancy.  
     
Standard & Poor's stressed the loans on the watchlist, along with
other loans with credit issues, as part of its pool analysis.  The
resultant credit enhancement levels support the raised and
affirmed ratings.
    
                          Ratings Raised
   
              Wachovia Bank Commercial Mortgage Trust
    Commercial Mortgage pass-through certificates series 2002-C1

                          Rating
                          ------
                Class   To      From     Credit enhancement
                -----   --      ----     ------------------
                D       AAA     AA+            16.67%
                E       AA+     AA             14.97%
                F       AA      A+             12.81%
                G       A+      A-             11.11%
                H       A-      BBB+            9.10%
                J       BBB+    BBB             6.79%
                K       BBB     BBB-            6.17%
                L       BB+     BB              4.87%
                M       BB-     B+              3.96%
    
                         Ratings Affirmed
    
             Wachovia Bank Commercial Mortgage Trust
    Commercial Mortgage pass-through certificates series 2002-C1
   
                 Class   Rating   Credit enhancement
                 -----   ------   ------------------
                 A-2     AAA              28.10%
                 A-3     AAA              28.10%
                 A-4     AAA              28.10%
                 B       AAA              23.46%
                 C       AAA              17.90%
                 N       B                 3.35%
                 IO-I    AAA                N/A
                 IO-II   AAA                N/A
  
                       N/A -- Not applicable.


WACHOVIA BANK: Moody's Affirms B3 Rating on $2.436MM Class O Cert.
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of two classes and
affirmed the ratings of seventeen classes of Wachovia Bank
Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 2003-C8 as:

  -- Class A-1, $92,425,314, affirmed at Aaa
  -- Class A-2, $186,550,000, affirmed at Aaa
  -- Class A-3, $241,738,000, affirmed at Aaa
  -- Class A-4, $213,104,000, affirmed at Aaa
  -- Class X-C, Notional, affirmed at Aaa
  -- Class X-P, Notional, affirmed at Aaa
  -- Class B, $29,227,000, upgraded to Aa1 from Aa2
  -- Class C, $13,396,000, upgraded to Aa2 from Aa3
  -- Class D, $28,009,000, affirmed at A2
  -- Class E, $13,396,000, affirmed at A3
  -- Class F, $15,831,000, affirmed at Baa1
  -- Class G, $12,178,000, affirmed at Baa2
  -- Class H, $15,831,000, affirmed at Baa3
  -- Class J, $7,307,000, affirmed at Ba1
  -- Class K, $6,089,000, affirmed at Ba2
  -- Class L, $4,871,000, affirmed at Ba3
  -- Class M, $2,436,000, affirmed at B1
  -- Class N, $4,871,000, affirmed at B2
  -- Class O, $2,436,000, affirmed at B3

Moody's is upgrading Classes B and C due to improved pool
performance, increased credit support resulting from loan pay offs
and amortization.

As of the March 17, 2008 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 7.4%
to $901.9 million from $974.2 million at securitization.  The
Certificates are collateralized by 52 mortgage loans.  The loans
range in size from less than 1.0% to 13.3% of the pool, with the
top 10 loans representing 29.6% of the pool.  The pool includes
seven loans with underlying ratings, representing 49.0% of the
pool.  One loan, representing 3.1% of the pool, has defeased and
has been replaced with U.S. Government securities.  The pool has
not realized any losses since securitization.  There are no loans
in special servicing at the present time.  Nine loans,
representing 7.3% of the pool, are on the master servicer's
watchlist.

Moody's was provided with full-year 2006 and full or partial-year
2007 operating results for 87.7% and 88.0% of the pool,
respectively.  Moody's average weighted loan to value ratio for
the conduit component is 83.0% compared to 90.3% at
securitization.

The largest loan with an underlying rating is the Tucson Mall Loan
($120.0 million -- 13.3%), which is secured by the borrower's
interest in a 1.3 million square foot (447,000 square feet is
collateral) regional mall located in downtown Tucson, Arizona.  
The mall is anchored by Macy's, Dillard's, JC Penney, Sears and
Mervyn's, all not part of the collateral.  As of September 2007,
inline occupancy and overall occupancy were 94.7% and 97.7%
compared to 92.3% and 97.6% at securitization.  In-line sales are
$448 per square foot compared to $365 per square foot at
securitization.  The loan has amortized 7.6% since securitization
and matures October 2008.  Moody's current underlying rating is
A2, compared to Baa2 at securitization.

The second largest loan with an underlying rating is the Meridian
Mall Loan ($79.0 million -- 8.8%), which is secured by the
borrower's interest in a 977,000 square foot (825,000 square feet
is collateral) regional mall located in Okemos, Michigan.  The
mall is anchored by Macy's, JC Penney, Bed Bath and Beyond, and
Dicks Sporting Goods.  As of September 2007, overall occupancy was
97.2% compared to 97.4% at securitization.  In-line sales are
$284 per square foot compared to $315 per square foot at
securitization.  There is subordinate debt in the amount of
$6.7 million held outside the trust.  The loan amortizes on a 25-
year schedule and matures September 2008.  The loan has amortized
10.5% since securitization.  Moody's current underlying rating is
Baa2, the same as at securitization.

The third largest loan with an underlying rating is the Park City
Center Loan ($61.3 million -- 6.8%), which is secured by a 50.0%
participation interest in a $122.6 million loan.  The collateral
includes the borrower's interest in a 977,000 square foot (825,000
square feet is collateral) regional mall located in Lancaster,
Pennsylvania.  The mall is anchored by Boscov's, Sears, JC Penney,
The Bon Ton Stores, and Kohl's.  As of September 2007, overall
occupancy was 97.1% compared to 96.4% at securitization.  There is
subordinate debt in the amount of $31 million held outside the
trust.  The loan has amortized 7.0% since securitization.  Moody's
current underlying rating is A3, compared to Baa2 at
securitization.

The fourth largest loan with an underlying rating is the Four
Seasons Hotel Loan ($52.7 million -- 5.8%), which is secured by
the borrower's interest in a 434-room full-service hotel located
in Chicago, Illinois.  The hotel has two restaurants and 22,000
square feet of meeting and conference space.  The hotel is managed
by Four Seasons Hotels under a management agreement that expires
in 2032 with several renewal options.  RevPAR has increased from
$234.10 at securitization to $299.50 at year-end 2007.  The loan
amortizes on a 25-year schedule and has amortized 9.1% since
securitization.  Moody's current underlying rating is A2, compared
to Baa2 at securitization.

The fifth loan with an underlying rating is the Parkdale Mall Loan
($51.2 million -- 5.7%), which is secured by the borrower's
interest in a 1.36 million square foot (587,629 square feet is the
collateral) regional mall located in Beaumont, Texas.  The mall is
anchored by Dillard's, JC Penney, Macy's and Sears.  The loan
amortizes on a 25-year schedule and has amortized 9.8% since
securitization.  Moody's current underlying rating is Baa1,
compared to Baa3 at securitization.

The sixth loan with an underlying rating is the Regency Square
Mall Loan ($48.1 million -- 5.3%), which is secured by secured by
a 50.0% participation interest in a $96.3 million loan.  The loan
is collateralized by the borrower's interest in a 1.45 million
square foot (938,031 square feet is the collateral) regional mall
located in Jacksonville, Florida.  The mall is anchored by Belk,
JC Penney, Dillard's and Sears.  The loan amortizes on a 30-year
schedule and has amortized 8.6% since securitization.  Moody's
current underlying rating is A3, the same as at securitization.

The seventh loan with an underlying rating is the Chandler
Festival Loan ($29.6 million -- 3.3%), which is secured by the
borrower's interest in a 364,649 square foot anchored shopping
center located in Chandler, Arizona, approximately six miles
southeast of Phoenix.  The property was 98.6% leased as of
December 2007, compared to 97.3% at securitization.  Major tenants
at the property include Linens N Things, Nordstrom Rack and
OfficeMax.  The loan amortizes on a 30-year schedule and has
amortized 7.5% since securitization.  Moody's current underlying
rating is A2, compared to A3 at securitization.

The top three conduit loans represent 17.8% of the pool.  The
largest conduit loan is the Chelsea Market Loan ($82.7 million --
9.2%), secured by a 50.0% participation interest in a
$165.3 million loan.  The 1.2 million square foot mixed-use
building includes retail and office portions and is located in the
Chelsea District of Manhattan, New York City.  The loan was
interest only for its first two years and now amortizes on a 30-
year schedule.  The loan has amortized 3.3% since securitization.  
Net operating income has increased approximately 11% since
securitization.  Moody's LTV is 78.0% compared to 85.0% at
securitization.

The second largest conduit loan is the Rivertowne Commons Loan
($40.6 million -- 4.5%), which is secured by the borrower's
interest in a 387,000 square foot grocery-anchored community
shopping center located in Oxon Hill, Maryland in the Washington
D.C. MSA.  The center is anchored by Kmart and Safeway.  Other
larger tenants include Old Navy, Staples and CVS.  As of January
2008, occupancy was 83.8% compared to 99.6% at securitization.  
The loan has amortized 5.5% since securitization.  Moody's LTV is
95.9% compared to 94.9% at securitization.

The third largest conduit loan is the Arco Center Loan ($37.0
million -- 4.1%), which is secured by the borrower's interest in
two twin 14-story, Class A office towers located in Long Beach,
California.  As of December 2007, the buildings were 94.0% leased
compared to 76.3% at securitization.  The loan was interest only
for its first two years and now amortizes on a 30-year schedule.  
The loan has amortized 2.5% since securitization.  Moody's LTV is
78.7% compared to 91.5% at securitization.


WINDSTREAM CORP: S&P Changes Outlook to Stable; Holds 'BB+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Little
Rock, Arkansas-based Windstream Corp. to stable from negative.  At
the same time, S&P affirmed the 'BB+' corporate credit rating and
all other ratings for Windstream and its related entities.  Debt
outstanding as of Dec. 31, 2007, totaled about $5.4 billion.
      
"The outlook revision reflects Windstream's success in mitigating
revenue losses related to its declining voice business with growth
in Internet and data revenues," said Standard & Poor's credit
analyst Susan Madison.  "Its EBITDA margin has also remained
stable, at around 50%, because of continued focus on cost
cutting," she said.
     
Additionally, since its 2006 spinoff from ALLTEL Corp. and its
merger with Valor Telecommunications Enterprises LLC, Windstream's
management has demonstrated a commitment to maintaining debt to
EBITDA in the low- to mid-3x area.  S&P expects Windstream's
credit metrics to remain supportive of a 'BB+' corporate credit
rating over the next one to two years as growth in Internet and
data services continues to mitigate revenue losses associated with
a declining access line base.  Longer term, Windstream's inability
to slow access line losses, a maturing broadband market or
significant price discounting because of competition, could
pressure ratings.
     
Windstream is an incumbent local exchange carrier providing voice
and data communication services to approximately 3.2 million
access lines in 16 states throughout the U.S.
     
The ratings on Windstream continue to reflect an aggressive
shareholder-oriented financial policy with a commitment to a
substantial common dividend that limits potential debt reduction.   
The company also faces accelerating competition for voice and data
services from cable operators that could lead to pricing and
margin pressure, and flat, to declining revenues from its mature
local telephone business.
     
Tempering factors include the company's position as the dominant
provider of local and long distance telecommunications services in
secondary and tertiary markets.  Those markets have experienced
less aggressive cable-based voice over Internet protocol
deployment, yet benefit from growth in data and Internet services,
solid operating margins, and moderate capital requirements.


WORNICK CO: Can Hire Kurtzman Carson as Claims and Noticing Agent
-----------------------------------------------------------------
The Wornick Company and its debtor-affiliates obtained authority
from the U.S. Bankruptcy Court for the District of Ohio to employ
Kurtzman Carson Consultants LLC as claims, noticing, balloting and
disbursing agents.

The Debtors related that they have thousands of creditors and
potential creditors and numerous other parties-in-interest in
these chapter 11 cases.  The Debtors submit that the engagement of
an independent third party to act as agent for the Court is the
most effective and efficient manner to perform the tasks.

The Debtors stated that KCC is well suited to provide these
services because KCC is a data-processing firm whose principals
and senior staff have in-depth chapter 11 experience in performing
noticing, claims processing, claims reconciliation and other
administrative tasks for chapter 11 debtors.  KCC is also
experienced in performing plan voting and distribution services,
and other services relating to its role as a claims and balloting
agent.

Specifically, KCC is expected to:

   a) prepare and serve required notices in these chapter 11
      cases;
   
   b) within five business days after the service of a particular
      notice, file with the Clerk's Office a certificate or
      affidavit of service;

   c) maintain copies of all proofs of claim and proofs of
      interest filed in these cases;

   d) maintain official claims registers in this case by docketing
      all proofs of claim and proofs of interest in a claims
      database that includes primary information for each such
      claim or interest asserted:

   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 requested by the Clerk's
      Office on 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
      such list available upon request to the Clerk's Office and
      any party in interest;

   h) provide access to the public for examination of copies of
      the proofs of claim or proofs of interest filed in this case
      without charge during regular business hours;

   i) record all transfers of claims pursuant to Rule 3001(e) of
      the Bankruptcy Rules and provide notice of such transfers as
      required by Rule 3001(e), if directed to do so by the Court;

   j) comply with applicable federal, state, municipal and local
      statutes, ordinances, rules, regulations, orders and other
      requirements;

   k) utilize temporary employees to process claims, as necessary;

   l) promptly comply with such further conditions and
      requirements as the Clerk's Office or the Court may at any
      time prescribe; and

   m) provide such other claims processing, noticing, balloting,
      and relating administrative services as may be requested
      from time to time by the Debtors.

In addition, the Debtors expected KCC to assist them with:

   (a) the preparation of their schedules, statements of financial
       affairs and master creditor list and any amendments
       thereto;

   (b) the reconciliation and resolution of claims;

   (c) the preparation, mailing and tabulation of ballots and
       other related services for the purposes of soliciting votes
       to accept or reject a plan of reorganization; and
  
   (d) provide technical support in connection with the foregoing.

Sheryl Betance, Director of Restructuring at Kurtzman Carson
Consultants LLC, stated that the Debtors will treat the fees and
expenses of KCC as administrative expenses of the Debtors'
Chapter 11 estates and will be paid in the ordinary course of
business.

Ms. Betance assured the Court that KCC is "disinterested" as that
term is defined in Section 101(14) of the Bankruptcy Code.

Headquartered in Cincinnati, Ohio, The Wornick Company --
http://www.wornick.com/-- is a supplier of individual and         
group military field rations to the Department of Defense.  In
addition the company continues to extend its core capabilities to
commercial markets where its customers include, but are not
limited to, Kraft Foods Inc., Gerber Products Company, well as
retail and grocery outlets including Walgreens Co., 7-Eleven, The
Kroger Co., Publix Super Markets and Meijer.

Wornick specializes in the production, packaging, and distribution
of shelf-life, shelf-stable, and frozen foods in flexible pouches
and semi-rigid products.  The firm's two main lines of business
are military rations (approximately 70% of revenues) and co-
manufacturing for leading food brands (30%).  The company produces
both individual (including MRE) and group rations (including
Unitized Group Rations-A or UGR-A) for the U.S. military.  MREs
comprise about 65% of military revenues.

The company and and five of its affiliates filed for Chapter 11
protection on Feb. 14, 2008 (Bankr. S.D. Ohio, Case No. 08-10654).  
Donald W. Mallory, Esq., Kim Martin Lewis , Esq., and Patrick
Burns, Esq. at Dinsmore & Shohl LLP represent the Debtors in
their restructuring efforts.  The Debtor selected Kurtzman Carson
Consultants LLC as claims, noticing and balloting agent.  An
official committee of unsecured creditors has not been appointed
in these cases.  The company listed between $100 million and $500
million assets and between $100 million and $500 million in debts
in its bankruptcy filing.


WORNICK CO: Judge Aug Approved Amended Disclosure Statement
-----------------------------------------------------------
The Hon. J. Vincent Aug, Jr., of the  U.S. Bankruptcy Court for
the Southern District of Ohio approved the adequacy of Wornick
Co. and its debtor-affiliates' Amended Disclosure Statement dated
April 4, 2008, explaining their Amended Joint Chapter 11 Plan of
Liquidation.

                       Overview of the Plan

As reported in the Troubled Company Reporter on April 9, 2008,
Pursuant to the provisions of the U.S. Bankruptcy Code, only
holders of allowed claims or equity interests in classes of claims
or equity interests that are impaired and that are not deemed
to have rejected a proposed chapter 11 plan are entitled to vote
to accept or reject such plan.

Classes of claims or equity interests in which the holders of
claims or equity interests are unimpaired under a Chapter 11 plan
are deemed to have accepted the plan and are not entitled to
vote to accept or reject the plan.  Classes of claims or equity
interests in which the holders of claims or equity interests will
receive no recovery under a Chapter 11 plan are deemed to have
rejected the plan and are not entitled to vote to accept or reject
the plan.

Pursuant to the Plan, holders of Allowed Claims in Classes 1, 2,
5, 6, and 7 and Equity Interests in Class 10 will either receive
distributions equal to the total amount of their Claims or
retain their Equity Interests, as applicable, will be Unimpaired
and will be deemed to have accepted the Plan.

Holders of Allowed Claims in Classes 3 and 4 of the Plan will be
entitled to partial distribution on account of their Claims and
are Impaired.  As a result, holders of Allowed Claims in Classes 3
and 4 are entitled to vote to accept or reject the Plan.

Holders of Allowed Claims in Classes 8 and 9 and Equity Interests
in Class 11 of the Plan, consisting of holders of TWC Note Claims,
Subordinated Securities Claims and Equity Interests in the Non-
Surviving Debtors and Wornick, respectively, will not receive any
distributions under the Plan.  As a result, holders of Allowed
Claims in Classes 8 and 9 and Equity Interests in Class 11 are
conclusively presumed to have rejected the Plan.

   Type of                                  Allowed    Estimated
    Claim              Treatment            Claims     Recovery
   -------             ---------            -------    ---------
   Priority            Unimpaired          $100,000      100%
   Tax Claims

   DIP Financing       Unimpaired       $35,000,000      100%
   Claims

   Other Priority      Unimpaired        $1,700,000      100%
   Claims

   Other Secured       Unimpaired                --      100%
   Claims

   Prepetition          Impaired                 --       --
   Secured Loan
   Agreement
   Claims

   Senior Secured       Impaired      $140,219,335;      $36%
   Note Claims                      $125,000,000 in   accrued
                                     principal plus       and
                                     $14,219,335 in    unpaid
                                        prepetition  interest
                                   accrued interest
                                     
   General Unsec.      Unimpaired        $1,000,000      100%
   Claims

   Unliquidated        Unimpaired                --       N/A
   Claims

   Intercompany        Unimpaired                --       N/A
   Claims

   TWC Note Claims      Impaired        $38,000,000        0%

   Subordinated         Impaired                 --        0%
   Securities
   Claims

   Equity Interests    Unimpaired                        100%
   in Surviving
   Debtors other
   than Wornick

   Equity Interests     Impaired                           0%
   of Non-Surviving
   Debtors and
   Wornick

                   Equity Sale Pursuant to Plan

On Feb. 12, 2008, the Debtors entered into an Purchase Agreement
with Viren Acquisition Corp.  The Purchase Agreement provides for
the sale of 100% of the equity of Reorganized Wornick, or
substantially all of the Debtors' assets to the Purchaser as well
the assumption by the Purchaser of certain of the Debtors'
liabilities pursuant to section 363 of the U.S. Bankruptcy Code.

The Debtors, in the exercise of their business judgment, believe
the Purchase Agreement is the best way to maximize the value of
the estates for creditors.  The Purchase Price is subject to
higher and better offers and the Purchase Price far exceeds the
projected recoveries under the Debtors' liquidation analysis.  The
Debtors intend to address the issue of whether the Purchase
Agreement, or a Modified Purchase Agreement, as the case may be,
maximizes value at a transaction approval hearing.

Following the occurrence of certain events, the Purchaser may
elect, by providing written notice to the Debtors, that the
Transaction be effected outside a Chapter 11 plan, in the form of
a sale of all or substantially all of the Debtors' assets, in
which case the Debtors and the Purchaser will seek Court approval
of the Asset Sale at the transaction approval hearing.

A full-text copy of the Amended Disclosure Statement is available
for free at

               http://ResearchArchives.com/t/s?2a80

A full-text copy of the Amended Joint Chapter 11 Plan of
Liquidation is available for free at

               http://ResearchArchives.com/t/s?2a81

Based in Cincinnati, The Wornick Company --
http://www.wornick.com/-- is a leading supplier of individual
and       
group military field rations to the Department of Defense.  In
addition the company continues to extend its core capabilities to
commercial markets where its customers include, but are not
limited to, Kraft Foods, Inc., Gerber Products Company, as well as
retail and grocery outlets including Walgreens Co., 7-Eleven, The
Kroger Co., Publix Super Markets and Meijer.

Wornick specializes in the production, packaging, and distribution
of shelf-life, shelf-stable, and frozen foods in flexible pouches
and semi-rigid products.  The firm's two main lines of business
are military rations (approximately 70% of revenues) and co-
manufacturing for leading food brands (30%).  The company produces
both individual (including MRE) and group rations (including
Unitized Group Rations-A or UGR-A) for the U.S. military.  MREs
comprise about 65% of military revenues.

The company and and five of its affiliates filed for Chapter 11
protection on Feb. 14, 2008 (Bankr. S.D. Ohio, Case No. 08-10654).  
Donald W. Mallory, Esq., Kim Martin Lewis , Esq., and Patrick
Burns, Esq. at Dinsmore & Shohl LLP represent the Debtors in
their restructuring efforts.  The Debtor selected Kurtzman Carson
Consultants LLC as claims, noticing and balloting agent.  An
official committee of unsecured creditors has not been appointed
in these cases.  The company listed between $100 million and $500
million assets and between $100 million and $500 million in debts
in its bankruptcy filing.


WORNICK CO: Plan Confirmation Hearing Scheduled on June 23
----------------------------------------------------------
The Hon. J. Vincent Aug, Jr., of the U.S. Bankruptcy Court
for the Southern District of Ohio will convene a hearing June 25,
2008, at 10:00 a.m., prevailing Eastern Time, to consider
confirmation of Wornick Co. and its debtor-affiliates' Amended
Joint Chapter 11 Plan of Liquidation dated April 4, 2008.

Objections, if any, are due June 11, 2008, at 4:00 p.m.,
prevailing Eastern Time.

                      About Wornick Company

Based in Cincinnati, The Wornick Company --
http://www.wornick.com/-- is a leading supplier of individual
and       
group military field rations to the Department of Defense.  In
addition the company continues to extend its core capabilities to
commercial markets where its customers include, but are not
limited to, Kraft Foods, Inc., Gerber Products Company, as well as
retail and grocery outlets including Walgreens Co., 7-Eleven, The
Kroger Co., Publix Super Markets and Meijer.

Wornick specializes in the production, packaging, and distribution
of shelf-life, shelf-stable, and frozen foods in flexible pouches
and semi-rigid products.  The firm's two main lines of business
are military rations (approximately 70% of revenues) and co-
manufacturing for leading food brands (30%).  The company produces
both individual (including MRE) and group rations (including
Unitized Group Rations-A or UGR-A) for the U.S. military.  MREs
comprise about 65% of military revenues.

The company and and five of its affiliates filed for Chapter 11
protection on Feb. 14, 2008 (Bankr. S.D. Ohio, Case No. 08-10654).  
Donald W. Mallory, Esq., Kim Martin Lewis , Esq., and Patrick
Burns, Esq. at Dinsmore & Shohl LLP represent the Debtors in
their restructuring efforts.  The Debtor selected Kurtzman Carson
Consultants LLC as claims, noticing and balloting agent.  An
official committee of unsecured creditors has not been appointed
in these cases.  The company listed between $100 million and $500
million assets and between $100 million and $500 million in debts
in its bankruptcy filing.


* Fitch Says Positive Signs Emerged Despite Decline in US Housing
-----------------------------------------------------------------
As the U.S. housing continues its steep cyclical decline, a few
positive signs have emerged, though it looks likely that the
housing contraction will extend through 2008, according to Fitch
Ratings in its latest edition of 'Chalk Line'.

'Continued low mortgages rates, some improvement in affordability,
proposed government support for beleagured mortgage holders and
the economic stimulus program may signal a possible step in the
right direction for U.S. housing,' said Managing Director and lead
homebuilding analyst Bob Curran.  'That said, a modest recession,
declining home prices, tighter mortgage standards even for
conventional loans, poor buyer psychology and record levels of new
and existing homes for sale will continue to define the current
environment for housing.'

Typically homebuilders' operating and financial performances were
quite weak in the fourth quarter, a pattern that is likely to be
replicated in first-quarter 2008 results.  Deterioration in credit
metrics continued in 4Q'07 and 1Q'08, particularly for profit
related metrics.  'Tangible net worth covenants have been and will
be challenged,' said Curran.

Fitch will provide a 4Q'07 recap, as well as discuss its outlook
for calendar 2008 during a teleconference on Tuesday, April 15,
2008 at 11:00a.m. ET.

New features in this report include homebuilders' quarterly growth
trends and margin statistics for 4Q'07, excluding the impact of
non-recurring, non-cash real estate charges, and information about
fourth quarter and fiscal year-to-date option write-offs and land
value write-downs.  Information is provided on single family
starts by intent and design.  Fitch assesses actual reductions in
inventories since peak levels and discusses the effect of the FAS
109 deferred tax valuation adjustment.  Builder fourth quarter and
LTM pretax and net income statistics are adjusted for non-
recurring charges.  The federal government's latest efforts to
support housing and the mortgage sector are discussed.  The
presidential candidates' housing/mortgage proposals are updated as
are the Fitch economic and construction forecasts.


* S&P Downgrades 12 Tranches' Ratings From Six Cash Flows and CDOs
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 12
tranches from six U.S. cash flow and hybrid collateralized debt
obligation transactions.  The downgraded tranches have a total
issuance amount of $685.5 million.
     
Five of the six transactions are mezzanine structured finance CDOs
of asset-backed securities, which are collateralized in large part
by mezzanine tranches of residential mortgage-backed securities
and other SF securities.  The other transaction is a CDO of CDO
transaction that was collateralized at origination primarily by
notes from other CDOs, as well as by tranches from RMBS and other
SF transactions.
     
The CDO downgrades reflect a number of factors, including credit
deterioration and recent negative rating actions on U.S. subprime
RMBS securities.
     
To date, including the CDO tranches listed below and including
actions on both publicly and confidentially rated tranches, S&P
has lowered its ratings on 3,215 tranches from 748 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, 358 ratings from 97 transactions are
currently on CreditWatch negative for the same reasons.  In all,
S&P has downgraded $338.665 billion of CDO issuance.  
Additionally, S&P's ratings on $18.130 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
    -----------                        -----       --         ----
Fortress ABS Opportunities Ltd.        A-2         AA-        AA+
Fortress ABS Opportunities Ltd.        B           BB+        BBB
Fortress ABS Opportunities Ltd.        Ba          BB+        BBB
Orchid Structured Finance CDO II Ltd.  A-2         AA+        AAA
Orchid Structured Finance CDO II Ltd.  A-3         BBB        AA
Orchid Structured Finance CDO II Ltd.  B           BB         A-
Parapet 2006 Ltd.                      A           A+         AA
Putnam Structured Product
Funding 2003-1 Ltd.                    C           BBB+       A-  
Saturn Ventures II Ltd.                A-2         AA+        AAA  
Saturn Ventures II Ltd.                A-3         AA-        AA  
Saturn Ventures II Ltd.                B           BBB-       BBB
Stack 2004-1 Ltd.                      D           BB+        BBB

                    Other Outstanding Ratings

   Transaction                                 Class     Rating
   -----------                                 -----     ------
Fortress ABS Opportunities Ltd.                A         AA+
Fortress ABS Opportunities Ltd.                A-1a      AA+
Orchid Structured Finance CDO II Ltd.          A-1       AAA
Putnam Structured Product Funding 2003-1 Ltd.  A-1       AAA/A-1+
Putnam Structured Product Funding 2003-1 Ltd.  A-2       AAA
Putnam Structured Product Funding 2003-1 Ltd.  B         AA
Putnam Structured Product Funding 2003-1 Ltd.  S         AAA
Saturn Ventures II Ltd.                        A-1       AAA/A-1+
Stack 2004-1 Ltd.                              A         AAA
Stack 2004-1 Ltd.                              B         AA
Stack 2004-1 Ltd.                              C         A


* S&P Assigns Ratings on 147 CDO Tranches on Negative CreditWatch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed 147 U.S. synthetic CDO
tranche ratings on CreditWatch with negative implications,
withdrew one tranche rating, and raised one tranche rating.  At
the same time, S&P affirmed its ratings on 16 tranches and removed
them from CreditWatch negative.
     
The CreditWatch negative placements reflect negative rating
migration in the respective portfolios and synthetic rated
overcollateralization ratios that had fallen below 100% as of the
March month-end run.  The rating on one tranche was placed on
CreditWatch negative because it failed its step subordination.   
This tranche, however, did have an SROC that was higher than 100%.   
The ratings S&P affirmed and removed from CreditWatch negative had
SROC ratios of 100% or higher at their current rating levels.  S&P
withdrew one rating because the transaction unwound.  S&P raised
one rating because a rebalance of its portfolio brought the SROC
above 100% at the next higher rating level, which was the original
rating on the tranche at closing.

                          Ratings List

                       ABACUS 2004-2 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         C                        BBB+/Watch Neg      BBB+

                       ABACUS 2004-3 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Class B                  AA/Watch Neg        AA
         Class C                  A-/Watch Neg        A-

                    ABACUS 2005-1 CB1 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B                        A+/Watch Neg        A+
         D                        BBB+/Watch Neg      BBB+

                      ABACUS 2006-11 Ltd
                        Series 2006-11

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AA/Watch Neg        AA
         A-2 Ser 1                BBB/Watch Neg       BBB
         A-2 Ser 2                BBB/Watch Neg       BBB
         B                        BB/Watch Neg        BB
         B Ser 2                  BB/Watch Neg        BB
         C                        B+/Watch Neg        B+

                       ABACUS 2006-12 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A-1                      BBB/Watch Neg       BBB
         A-2                      BB/Watch Neg        BB
         B                        BB-/Watch Neg       BB-
         C                        CCC+/Watch Neg      CCC+
         D                        CCC/Watch Neg       CCC

                        ABACUS 2006-9 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A-1                      AA-/Watch Neg       AA-
         A-2                      A-/Watch Neg        A-
         B                        BBB/Watch Neg       BBB
         C                        BBB-/Watch Neg      BBB-

                       ABACUS 2006-HGS1 Ltd.
                          Series 2006-HGS1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A-1                      BBB/Watch Neg       BBB
         A-2                      BB/Watch Neg        BB
         AMSS                     A/Watch Neg         A
         B                        B-/Watch Neg        B-
         C                        CCC+/Watch Neg      CCC+
         D                        CCC/Watch Neg       CCC

                       ABSpoke 2005-IA Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         ABSpoke                  AAA/Watch Neg       AAA

                       ABSpoke 2005-IB Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         ABSpoke                  A/Watch Neg         A

                       ABSpoke 2005-IC Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Fxd Rate                 BBB-/Watch Neg      BBB-

                       ABSpoke 2005-VA Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         ABSpoke                  A-/Watch Neg        A-

                          Arlo III Ltd.
                        Series 2005 GPARK

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                          ARLO VI Ltd.
              Series 2006-B-1 (Prima II-CDO Long/Short)

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B-1                      AA/Watch Neg        AA

        Bear Stearns High Grade Structured Credit Strategies

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     Unf Cr Def               AA                  AA/Watch Neg

         Cloverie PLC
         Series 2006-10

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AA-/Watch Neg       AA-

                           Cloverie PLC
                          Series 2007-10

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-10                  AA                  AA/Watch Neg

                           Cloverie PLC
                          Series 2007-18

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-18                  AAA                 AAA/Watch Neg

                           Cloverie PLC
                          Series 2007-19

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-19                  AAA                 AAA/Watch Neg

                           Cloverie PLC
                          Series 2007-20

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-20                  AA                  AA/Watch Neg

                            Cloverie PLC
                           Series 2007-22

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-22                  AAA                 AAA/Watch Neg

                            Cloverie PLC
                           Series 2007-23

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     2007-23                  AA                  AA/Watch Neg

                           Coriolanus Ltd.
                              Series 39

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Tranche                  CCC+/Watch Neg      CCC+

                Credit and Repackaged Securities Limited
                            Series 2007-18

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A-/Watch Neg        A-

                         Credit Default Swap
                           Series CA1119131

                                          Rating
                                          ------
         Class                    To                  From
         -----                    --                  ----
         Tranche                  A-srb/Watch Neg     A-srb

                       Credit Default Swap
                      Series MAPLES 2007-12

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Tranche                  BBB+srp/Watch Neg   BBB+srp

                 Crown City CDO 2005-1 Limited

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B                        AA/Watch Neg        AA
                   Dallaglio CDO 2005-4 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B                        BB+/Watch Neg       BB+

                       Dunloe 2005-I Ltd

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        BBB/Watch Neg       BBB
         B                        BB/Watch Neg        BB
         C                        B+/Watch Neg        B+

                         Eirles Two Ltd.
                           Series 242

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Series 242               AA+/Watch Neg       AA+

                          Eirles Two Ltd.
                            Series 245

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Series 245               A/Watch Neg         A

                          Eirles Two Ltd.
                     Series 257-259 & 264-266
   
                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Series 257               B-/Watch Neg        B-

      Gloucester SPC, acting for the account of Cheyenne
2007-I                                                                      
                       Segregated Portfolio

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        B/Watch Neg         B

                       Infiniti SPC Limited
                       Kenmore Street 2006-2
                       
                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         7A-2                     AAA/Watch Neg       AAA
         7B-1                     AA/Watch Neg        AA
         7C-1                     A/Watch Neg         A
         7EA-2                    AAA/Watch Neg       AAA
         7EB-1                    AA/Watch Neg        AA
      
                       Infiniti SPC Limited
                       Series CPORTS 2006-3

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AAA/Watch Neg       AAA

                           Ixion PLC
                       Series 4, 5, 6, & 7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         5                        BB+/Watch Neg       BB+

                   Jefferson Valley CDO SPC
                       Series 2006-1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        A-/Watch Neg        A-

                      Jupiter Finance Ltd.
                        Series 2007-002

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Port CrLkd               AA/Watch Neg        AA

                       Kenmare 2005-I Ltd

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB-/Watch Neg      BBB-

               Kiawah (New York) Trust Series 2007-1

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     Notes                    A                   A/Watch Neg      

                    Magnolia Finance II PLC
                         Series 2006-5A

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AA+/Watch Neg       AA+

                    Magnolia Finance II PLC
                          Series 2006-5B

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B                        AA-/Watch Neg       AA-

                    Magnolia Finance II PLC
                          Series 2006-5CE

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         CE                       A-/Watch Neg        A-

                    Magnolia Finance II PLC
                        Series 2006-5CG

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         CG                       A-/Watch Neg        A-

                    Magnolia Finance II PLC
                         Series 2006-5CU

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         CU                       A-/Watch Neg        A-

                     Lunar Funding I Ltd.
                           Series 12

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         12                       AA/Watch Neg        AA

                          Mint 2005-1 Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         D-1                      A/Watch Neg         A
         E                        BBB/Watch Neg       BBB

                     Momentum CDO (Europe) Ltd.

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Series 2007-9            AAA/Watch Neg       AAA

                    Morgan Stanley ACES SPC
                          Series 2005-24

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AAA/Watch Neg       AAA

                    Morgan Stanley ACES SPC
                          Series 2005-25

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         ScFltRtNts               BBB+/Watch Neg      BBB+

                    Morgan Stanley ACES SPC
                         Series 2006-11

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         III                      BBB+/Watch Neg      BBB+

                    Morgan Stanley ACES SPC
                         Series 2006-15

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     I                        AA+/Watch Neg       AA+
     IIA                      A+                  A+/Watch Neg
     IIB                      A+                  A+/Watch Neg

                    Morgan Stanley ACES SPC
                         Series 2006-16

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         I                        AA-/Watch Neg       AA-
         IIA                      A-/Watch Neg        A-
         III                      BB+/Watch Neg       BB+

                    Morgan Stanley ACES SPC
                         Series 2006-18

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AA+/Watch Neg       AA+

                    Morgan Stanley ACES SPC
                         Series 2006-19

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AAA/Watch Neg       AAA

                    Morgan Stanley ACES SPC
                          Series 2006-20

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AAA/Watch Neg       AAA
         II                       BBB/Watch Neg       BBB

                    Morgan Stanley ACES SPC
                          Series 2006-21

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AA-/Watch Neg       AA-
         III                      BBB-/Watch Neg      BBB-

                    Morgan Stanley ACES SPC
                         Series 2006-24

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AAA/Watch Neg       AAA
         II                       BBB/Watch Neg       BBB

                    Morgan Stanley ACES SPC
                         Series 2006-26

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AAA/Watch Neg       AAA
         II                       BBB-/Watch Neg      BBB-

                    Morgan Stanley ACES SPC
                         Series 2007-13

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AAA/Watch Neg       AAA
         IIA                      AAA/Watch Neg       AAA
         IIB                      AAA/Watch Neg       AAA
         IIIA                     AA/Watch Neg        AA
         IIIB                     AA/Watch Neg        AA
         IV                       BB/Watch Neg        BB

                    Morgan Stanley ACES SPC
                         Series 2007-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         AI                       AA+/Watch Neg       AA+
         AII                      AA+/Watch Neg       AA+
         IIA                      AA-/Watch Neg       AA-
         IIB                      AA-/Watch Neg       AA-
         IIC                      AA-/Watch Neg       AA-
         IID                      AA-/Watch Neg       AA-

                    Morgan Stanley ACES SPC
                         Series 2007-25

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IA                       AAA                 AA

                    Morgan Stanley ACES SPC
                          Series 2007-6

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IIA                      AA+/Watch Neg       AA+
         IIIA                     AA-/Watch Neg       AA-

                    Morgan Stanley Managed ACES SPC
                             Series 2007-1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IIIA                     AAA/Watch Neg       AAA

                    Morgan Stanley Managed ACES SPC
                              Series 2007-5

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         III SrB                  AAA/Watch Neg       AAA

                    Morgan Stanley Managed ACES SPC
                             Series 2007-6

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         IIISrDFloa               AAA/Watch Neg       AAA

         North Street Referenced Linked Notes, 2005-7 Limited

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        BBB/Watch Neg       BBB
         B-1                      BB+/Watch Neg       BB+
         B-2                      BB-/Watch Neg       BB-
         C                        B/Watch Neg         B

                            PARCS Ltd.
                       Valley Forge 2007-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AA/Watch Neg        AA

                        PARCS Master Trust
                     Series 2007-19 Englewood

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         TrustUnits               A/Watch Neg         A

                        PARCS Master Trust
                     Series 2007-20 Englewood

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         TrustUnits               BBB+/Watch Neg      BBB+

                        PARCS Master Trust
                     Series 2007-21 Englewood
                    
                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         TrustUnits               BBB+/Watch Neg      BBB+

                        PARCS Master Trust
                       Series 2007-24 SAVOY

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     Units                    AA-                 AA-/Watch Neg

                        PARCS Master Trust
                      Series 2007-3 Calvados

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Trust Unit               A+/Watch Neg        A+

                        PARCS Master Trust
                      Series 2007-6 Calvados

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Trust Unit               BBB+/Watch Neg      BBB+

                        PARCS Master Trust
                      Series 2007-7 Calvados

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Trust Unit               A+/Watch Neg        A+

                        PARCS-R Master Trust
                           Series 2007-26

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Trust Unit               NR                  AAA

                        Penn's landing CDO SPC
                             Series 2007-1
                    
                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AAA/Watch Neg       AAA
         C                        A/Watch Neg         A
         D                        BBB/Watch Neg       BBB

                        Prelude Europe CDO Ltd.
                             Series 2006-1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB+/Watch Neg      BBB+

                       Prelude Europe CDO Ltd.
                            Series 2006-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB+/Watch Neg      BBB+

                          Primoris SPC Ltd
                                A1-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                              A1-7-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                                A2-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                              A3-10-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                                A3-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                                A5-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                               A6-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A/Watch Neg         A

                         Primoris SPC Ltd
                               C3-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB/Watch Neg       BBB

                         Primoris SPC Ltd
                               E3-7

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB-/Watch Neg      BBB-

                         Primoris SPC Ltd
                               F1-10

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BB/Watch Neg        BB

                         Pyxis Master Trust
                           Series 2007-28

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Units                    AAA/Watch Neg       AAA

                   REPACs Trust Series: CAT 2005-1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Debt Units               A/Watch Neg         A

                   REPACS Trust Series: Warwick

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B Debt Uts               AAA/Watch Neg       AAA

                             REVE SPC
                          Series 2007-47

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Series 47                BBB+/Watch Neg      BBB+

                     Rutland Rated Investments
                     Series 30 (Bedford 2006-1)

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A2-F                     A+/Watch Neg        A+

                        Seawall 2006-1 Ltd

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         C-2                      BBB+/Watch Neg      BBB+

                           Seawall SPC
                          Series 2006-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AA/Watch Neg        AA

                        Sentinel Limited
                                2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Tranche                  AA-/Watch Neg       AA-

       Series 2006-1 Segregated Portfolio of Greystone CDO SPC
                         Series 2006-1

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     A-1                      AA                  AA/Watch Neg
     A-2                      AA                  AA/Watch Neg

                        Solar V CDO SPC
                         Series 2007-1

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        AA/Watch Neg        AA

                            SPGS SPC
                         Series 2006-IA

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    A+/Watch Neg        A+

                            SPGS SPC
                         Series 2006-II

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BBB+/Watch Neg      BBB+

                            SPGS SPC
                         Series 2006-V

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    BB/Watch Neg        BB

                            SPGS SPC
                         Series 2006-VI

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         A                        BB/Watch Neg        BB

         SPGS SPC, acting for the account of SRRSPOKE 2007-IB
                     Series SRRSPOKE 2007-IB

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         I                        AA/Watch Neg        AA

                       STARTS (Ireland) PLC
                          Series 2007-22

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     Notes                    A+                  A+/Watch Neg

                            Strata Trust
                           Series 2006-2

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AA-/Watch Neg       AA-

                         Terra CDO SPC Ltd.
                    Series 2007-1 SEGREGATED PORT

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         B1                       BBB+/Watch Neg      BBB+

   TIERS Derby Synthetic CDO Floating Rate Credit Linked Trust
                            Series 2007-11

                                      Rating
                                      ------
     Class                    To                  From
     -----                    --                  ----
     Certs                    AAA                 AAA/Watch Neg

   TIERS Montana Floating Rate Credit Linked Trust Series 2007-3

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Certificat               A/Watch Neg         A

                      The Toronto-Dominion Bank

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Prt Cr Lnk               B+/Watch Neg        B+

                            Tribune Ltd.
                     Series 19 MAPLES 2004-1789

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Trance D2                BBB+/Watch Neg      BBB+

                            Tribune Ltd.
                             Series 42

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Tranche A                A/Watch Neg         A

                            Tribune Ltd.
                             Series 45

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Tranche                  AAA/Watch Neg       AAA

                             Tribune Ltd.
                              Series 47

                                           Rating
                                           ------
         Class                    To                  From
         -----                    --                  ----
         Notes                    AA-/Watch Neg       AA-


* David A. McKibbin Joins McDonald Hopkins-WPB Unit as Of Counsel
-----------------------------------------------------------------
David A. McKibbin joined the West Palm Beach office of McDonald
Hopkins LLC as Of Counsel.  A practicing attorney for more than
30 years, McKibbin focuses on commercial business and real estate
law in the firm's Business Department.

"We are delighted to have David McKibbin join McDonald Hopkins,"
John Metzger, managing attorney of the firm's West Palm Beach
office, said.  "His real estate, hospitality and equine practice
is an excellent fit for McDonald Hopkins."

Mr. McKibbin's experience includes all facets of commercial
business law, such as contract negotiations, lender and borrower
loan documentation, and corporate and partnership counseling.  He
specializes in the real estate, hotel/hospitality and thoroughbred
equine industries.

Mr. McKibbin's real estate expertise includes drafting condominium
and timeshare documents, preparing retail and office leases,
representing clients before regulatory bodies, and advising
clients on title insurance matters.  In the hotel and hospitality
industry, Mr. McKibbin counsels clients on sales, acquisitions,
and refinancing of properties, and has extensive interaction with
national franchisors on behalf of local and regional franchisees.  

His specialized knowledge of equine law encompasses partnership
agreements for racing stables and breeding farms, stallion
syndicate agreements, insurance settlement agreements, and
appearances before regulatory agencies and legislative committees.

                    About McDonald Hopkins LLC

McDonald Hopkins LLC -- http://www.mcdonaldhopkins.com/-- is a  
full-service firm focused on business law, litigation,
restructuring, and estate planning.  The company has more than 130
attorneys in Cleveland, Chicago, Columbus, Detroit, and West Palm
Beach.


* Structured Finance Lawyer Mark S. Dola Joins King & Spalding
--------------------------------------------------------------
King & Spalding reported that structured finance lawyer Mark S.
Dola has joined the firm's Washington office as counsel.  He will
focus his practice on structured derivatives and securitization
transactions and will participate actively in the firm's subprime
and capital markets special task force.

"We are delighted to welcome [Mr. Dola] to the firm," Robert S.
Finley, head of King & Spalding's finance group, said.  "[Mr.
Dola] brings substantive experience in the structured finance
sector to the firm."

"His addition to the finance practice further enhances our ability
to provide clients with the expertise and service they need," Mr.
Finley added.

Mr. Dola advises issuers, underwriters, and placement agents in
securitization transactions involving a variety of assets classes,
including credit card and trade receivables and has considerable
experience with collateralized debt obligations, credit-linked
notes, and credit default swaps.  Mr. Dola joins King & Spalding
from McKee Nelson LLP, where he was of counsel.

Mr. Dola earned a B.A. degree at Yale University and a J.D.
degree, cum laude, from Georgetown University Law Center.

"I am thrilled to be joining King & Spalding," Mr. Dola said.  
"The solid reputation and talented lawyers of the firm's finance
practice present exciting opportunities for someone with my
experience, and I look forward to contributing to the firm's
growth."

                       About King & Spalding

King & Spalding LLP -- http://www.kslaw.com/-- is an       
international law firm with more than 800 lawyers in Atlanta,
Dubai, Houston, London, New York, Riyadh (affiliated office) and
Washington, D.C.  The firm represents half of the Fortune 100.  
King & Spalding is into financial restructuring practices.  It
provides valuable knowledge and in-depth experience to virtually
all facets of corporate reorganizations, in-court and out-of-court
debt restructuring, bankruptcy and insolvency litigation, and
distressed asset mergers and acquisitions.  This practice is
regularly retained in bankruptcy matters and workouts to represent
debtors, trustees, creditors' committees, institutional lenders,
other critical creditors and parties-in-interest, and potential
acquirers of businesses and large assets.  

The Houston office of King & Spalding, with more than 100 lawyers,
provides a variety of services to clients the world over.   Chief
among its practices are those focusing on litigation and
transactional law, especially energy, international arbitration
and Latin American matters.


* Ascend Says US Major Airlines Face $110BB Fleet Upgrade Costs
---------------------------------------------------------------
Over the next decade the major US airlines are facing a
potentially crippling bill running to over one hundred billion
dollars to upgrade their ageing fleets, according to industry
experts.
    
Analysis by Ascend, a provider of information and consultancy to
the aerospace industry, reveals that the airlines face being stuck
with old aircraft for years to come because they do not have
enough firm orders to replace them.  Order backlogs at both Boeing
and Airbus means there is unlikely to be any quick fix.

The problems are particularly acute for major US carriers American
Airlines, Northwest Airlines and United Airlines.  All have
significant numbers of ageing aircraft in service that will need
to be replaced in the next few years.

However, order backlogs and delays to new aircraft, such as that
for the 787 disclosed by Boeing on April 9, 2008, mean that even
if those replacements were ordered, they would not be delivered
until around 2012-2015.
    
If American Airlines and United Airlines fail to place those
orders soon Ascend's data shows that in 2015 American Airlines'
fleet of:
    
   -- 15 Boeing 767-200ER will be on average 28 years old;
   -- 58 Boeing 767-300ER will be on average 21 years old;
   -- 126 Boeing 757-200 will be on average 19 years old.
    
And for United Airlines, in 2015 its fleet of:
    
   -- 64 Boeing 737-300 will be on average 26 years old;
   -- 30 Boeing 737-500 will be on average 23 years old;
   -- 97 Boeing 757-200 will be on average 23 years old;
   -- 35 Boeing 767-300ER will be on average 20 years old.

The bill for replacing these aircraft alone is likely to come to
around $20 billion for each airline.
    
In the case of Northwest its warhorse fleet of around 100 DC9's is
approaching 40 years in service.
    
"It is far from exaggerating to say we really are at crisis point
for these airlines," Gehan Talwatte, managing director of Ascend
said.  "American, Northwest and United will need huge numbers of
new aircraft in the next decade.  The difficulty is that without
already having the orders in place those aircraft are not going to
be delivered any time soon."

"But this challenge pales next to the issue of where the
financing is going come from," Mr. Talwatte continued.  "All of
the major US carriers, apart from American Airlines, have been
through Chapter 11 bankruptcy.  But the tightening of the credit
markets we have seen this year means lenders are much more risk
averse.  If a lack of financing delays these orders then American,
Northwest and United are likely to be facing their toughest
challenges yet."

"It is difficult to see how consolidation of the US market will
help to solve this problem, unless there is wholesale
rationalisation of services and aircraft.'"
    
American Airlines, Northwest Airlines and United Airlines may have
short term fleet issues to address, but according to Ascend's
analysis all six of the US majors i.e. American Airlines, United
Airlines, Delta Air Lines, Northwest Airlines, Continental
Airlines and US Airways, will need to place substantial orders for
replacement aircraft in the next 5 to 10 years.
    
Ascend estimates that combined, the six airlines have these
aircraft in service that over the next 15 years will be
coming to the end of their working life:

   -- 34 Airbus A300-600
   -- 435 MD-80
   -- 400 Boeing 757-200
   -- 145 Boeing 767
   -- 289 Boeing 737 "Classic"
   -- 25 Boeing 747-400
   -- 92 DC-9
    
In total, the bill for replacing these 1420 aircraft will, at
current prices, come to over $110 billion.
    
Some orders and options for replacements have already been made by
the six airlines, but Ascend's data shows there are still many
more orders necessary.
    
                            Asia ahead
    
Ascend also compared the current situation of the US majors with
their rivals in Asia and the Middle East.  The data reveals that
these carriers already have substantial orders in place for the
next generation of aircraft scheduled for delivery in the next few
years:
    
   -- Emirates Airlines - has 193 new aircraft on order, more than
      its current fleet of 115.  Current average fleet age is just
      5 years.
    
   -- Qatar Airways - has 145 new aircraft on order.  It has a
      fleet of 61 aircraft, with an average age of 4 years.
    
   -- Singapore Airlines - has 82 new aircraft on order.  Its
      existing fleet of 97 aircraft has an average age of 6 years.
    
   -- China - more than 800 new aircraft are scheduled for
      delivery to various airlines by 2016.
    
"What this means for the US majors is that without radical change
they will continue to fall further and further behind, " added
Mr. Talwatte.  "Carriers like Singapore Airlines and Emirates are
already flying younger more fuel efficient aircraft and have more
on the way."  

"Newer aircraft are substantially more fuel efficient and require
less maintenance," " Mr. Talwatte concluded.  "Add in the soaring
price of fuel and it is clear there are big savings for carriers
with fleets of the newest, most up to date aircraft.  US major
airlines, with their ageing fleets will not be able to compete."


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------

                               Total
                               Shareholders    Total     Working
                               Equity          Assets    Capital     
  Company              Ticker  ($MM)           ($MM)      ($MM)
  -------              ------  ------------    ------    -------
Absolute Software       ABT          (3)          77       28
AFC Enterprises         AFCE        (36)         151       (7)  
Alaska Comm Sys         ALSK        (28)         557       24
Bare Escentuals         BARE       (132)         214       76
Blount International    BLT         (78)         472       140
CableVision System      CVC      (5,131)       9,807     (630)
Carrols Restaurant      TAST        (13)         463      (29)
Centennial Comm         CYCL     (1,063)       1,343       14
Cheniere Energy         CQP        (203)       1,962      109
Choice Hotels           CHH        (149)         338      (31)
Cincinnati Bell         CBB        (671)       1,966       17
Claymont Stell          PLTE        (40)         158       80
Compass Minerals        CMP         (48)         722      145
Corel Corp.             CRE         (20)         249      (19)
Crown Media HL          CRWN       (619)         703       48
CV Therapeutics         CVTX       (157)         281      204
Cyberonics              CYBX        (18)         132      (28)
Deltek Inc              PROJ       (144)         148      (12)
Denny's Corporation     DENN       (201)         413      (65)
Domino's Pizza          DPZ      (1,434)         497       82
Dun & Bradstreet        DNB        (467)       1,419     (262)
Einstein Noah Re        BAGL        (41)         146        0
Entropic Communications ENTR        (33)         177       29
Extendicare Real        EXE-U       (24)       1,277      161
Gencorp Inc.            GY          (52)         995       77
General Motors          GM      (40,071)     149,500   (1,798)
Healthsouth Corp.       HLS      (1,025)       2,529     (351)
IDEARC Inc              IAR      (8,531)       1,658      391
IMAX Corp               IMX         (77)         213        0
IMAX Corp               IMAX        (77)         213        0
Incyte Corp.            INCY       (141)         283      238
Indevus Pharma          IDEV        (74)         183       39
Intermune Inc           ITMN        (13)         292      237
Koppers Holdings        KOP         (24)         676      186
Life Sciences Re        LSR           0          236        7
Linear Tech Corp        LLTC       (564)       1,410      912
Lodgenet Entertn        LNET        (18)         709       18
Mediacom Comm           MCCC       (188)       3,631     (276)
National Cinemed        NCMI       (579)         439       40
Navistar Intl           NAVZ     (1,699)      10,786      164
Netsuite Inc            N           (49)          56      (46)
Nexstar Broadcasting    NXST        (87)         708      (19)
NPS Pharm Inc           NPSP       (210)         361     (119)
PRG-Schultz Intl        PRGX        (29)         115       21
Primedia Inc            PRM        (129)         282        6
Protection One          PONN        (13)         675     (287)
Radnet Inc.             RDNT        (53)         434       41
Regal Entertainment     RGC         (93)       2,594      (41)
Riviera Holdings        RIV         (42)         219       18
RSC Holdings Inc        RRR         (73)       3,554     (283)
Rural Cellular          RCCC       (595)       1,328       98
Sally Beauty Hol        SBH        (761)       1,405      354
Sealy Corp.             ZZ         (113)       1,025       22
Sipex Corp              SIPX        (18)          44        2
Sirius  Satellite       SIRI       (641)       1,587     (262)
Sonic Corp              SONC       (102)         765      (27)
Spectrum Brands         SPC        (104)       3,211      779
St. John Knits Inc.     SJKI        (52)         213       80
Station Casinos         STN        (291)       3,932      (50)
Stelco Inc              STE         (64)       2,657      693
Town Sports Int.        CLUB         (6)         483      (71)
UST Inc.                UST        (292)       1,461      446
Voyager Learning        VLCY        (53)         917     (637)
Warner Music Gro        WMG         (36)       4,572     (687)
Weight Watchers         WTW        (945)       1,037     (134)
WR Grace & Co.          GRA        (383)       3,871   (1,057)
XM Satellite            XMSR       (724)       1,709     (244)


                             *********

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.

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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.

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