TCR_Public/080506.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, May 6, 2008, Vol. 12, No. 107

                             Headlines

ADVANTAGE ONE: Case Summary & 19 Largest Unsecured Creditors
ALLIED HOLDINGS: Release Post-Confirmation Quarterly Report
ALOHA AIRLINES: Ch. 7 Trustee Sells Air Cargo Assets for $10.5MM
AMERICHIP INT'L: Posts $969,582 Net Loss in 1st Qtr. Ended Feb. 29
AQUATIC CELLULOSE: Feb. 29 Balance Sheet Upside-Down by $4,576,529

ASSET BACKED: Fitch Affirms 'B' Ratings on Four Cert. Classes
ATA AIRLINES: Final Hearing on Use of Cash Collateral on May 7
ATARI INC: To Merge with Infogrames Entertainment in $11MM Deal
AVENTINE RENEWABLE: Liquidity Issues Cue S&P to Affirm 'B+' Rating
BENAZZI CDO: Fitch Junks Ratings on Three Note Classes

BERNOULLI HIGH: Fitch Lowers Ratings on Six Note Classes
BI-LO LLC: Weak Performance Cues S&P to Revise Outlook to Neg.
BLOUNT INTL: Acquires Carlton Holdings for $63,000,000
BRODERICK CDO: Poor Collateral Cues Fitch to Downgrade Ratings
BSML INC: Andrew Rudnick Resigns as CEO and Board Chairman

BSML INC: Appoints Jeffrey Nourse as New Chief Executive
BUCHANAN ENTITIES: Voluntary Chapter 11 Case Summary
C-BASS CBO: Fitch Slashes AA Rating to CCC on $29 Million Notes
CALAMOS INVESTMENTS: To Refinance $300MM of Preferred Stocks
CATHOLIC CHURCH: Fairbanks' Creditors Wants Pachulski as Counsel

CATHOLIC CHURCH: Fairbanks' Creditors Wants Bundy as Co-Counsel
CHALLENGER POWERBOATS: Auditor Raises Going Concern Doubt
CHALLENGER POWERBOATS: Files Chapter 7 Petition in Missouri
CHASEFLEX: Moody's Junks Ratings on Four Loan Classes
CLAIRE'S STORES: Poor Performance Cues S&P to Junk Note Ratings

CHECKSMART FIN'L: Bill 545 Cues S&P to Put Rtngs. Under Neg. Watch
COBLESKILL BUSINESS: Case Summary & 12 Largest Unsecured Creditors
COLUMBIA RIVER: Case Summary & 20 Largest Unsecured Creditors
COUNTRYWIDE FINANCIAL: BofA Undecided on How to Treat $38MM Debt
COUNTRYWIDE MORTGAGE: Fitch Lowers Ratings on Five Cert. Classes

COUNTRYWIDE FIN'L: BOA's S-4/A Filing Cues S&P to Cut Rating
DALTON CDO: Poor Collateral Prompts Fitch to Chip Ratings
DANKA BUSINESS: To Undergo Voluntary Liquidation After Sale
DAVID MORGAN: Case Summary & 19 Largest Unsecured Creditors
DELTA AIR: Posts First Quarter 2008 Net Loss of $6,390,000,000

DELTA AIR: Merger with Northwest Will Result in 1,000 Cut Jobs
DELTA AIR: Internal Revenue Service Withdraws $11.8 Bil. Claims
DELTA AIR: JPMorgan Chase Holds 15% of Outstanding Common Stock
DELUXE ENTERTAINMENT: S&P Holds B Rating; Revises Outlook to Neg.
DEUTSCHE BANK: U.S. Affiliate Faces Insolvency Claims

DUKE FUNDING: Fitch Junks Ratings on Six Note Classes
DUKE FUNDING: Fitch Cuts 'BB-' Ratings to 'C' on Two Note Classes
ELECTRICAL COMPONENTS: Poor Liquidity Cues S&P to Junk Credit Rtng
EMPIRE LAND: Wants Court Approval of $20 Million Palmdale Loan
ENRON CORP: Releases 14th Post-Confirmation Report

ENRON CORP: Wants to Merge Certain Debtor-Affiliates to Save Costs
ENRON CORP: Court OKs $1.66 Bil. Citigroup Settlement Agreement
ENTEGRA TC: S&P Affirms 'B+' Rating on 2007 Recapitalization
EOS AIRLINES: Organizational Meeting to Form Committees on May 8
EXPRESS SCRIPTS: Moody's Withdraws Ba1 Corp. Family Rating

FAIRCHILD SEMICONDUCTOR: Moody's Holds Ba3 Corp. Family Rating
FORT SHERIDAN: Collateral Deterioration Cues Fitch to Cut Ratings
FULL COLOR SERVICES: Case Summary & 20 Largest Unsecured Creditors
GMAC LLC: ResCap Unit Launches Exchange Offer for $12.8 Bil. Notes
GMAC LLC: Fitch Cuts ID Rating to BB- After ResCap's Poor Fin'l

GMAC LLC: S&P 'B' Rating Unaffected by ResCap's Downgrades
GENERAL MOTORS: ResCap's Offer Does Not Affect S&P's Neg. Watch
GUARDIAN TECH: Secures $7 Million Financing from Nine Investors
INTERNATIONAL PAPER: Net Income Drops to $133MM in '08 1st Quarter
INTERPUBLIC GROUP: Net Loss Lowers to $62MM in 2008 First Quarter

ION MEDIA: S&P Puts '3' Recovery Rating on CCC+ Rated $400MM Notes
IPCS INC: S&P Affirms 'B-' Rating and Changes Outlook to Stable
IPSWICH STREET: Fitch Cuts Six Note Ratings and Removes Neg. Watch
ISLE OF CAPRI: S&P Lowers BB- Rating to B+ and Removes Neg. Watch
KLEROS PREFERRED: Fitch Junks Ratings on Four Note Classes

LEXINGTON PRECISION: Gets Final Approval to Use $4 Mil. Facility
LEXINGTON PRECISION: Gets Final Approval to Use $4 Mil. Facility
LEVITZ FURNITURE: WFNNB Demands Allowance of $1,892,587 Claim
LINENS N THINGS: Gets Interim OK to Tap $700-Mil. GECC DIP Loan
LINENS 'N THINGS: Bankruptcy Filing Cues Fitch's Default Rating

LINENS 'N THINGS: Bankruptcy Filing Cues Moody's Default Rating
LINENS 'N THINGS: S&P Withdraws Default Rating
MAGELLAN HEALTH: S&P Holds Ratings; Revises Outlook to Positive
MARATHON STRUCTURED: Fitch Chips Rating to BB on Class A-1 Notes
MERCK & CO: To Reduce U.S. Sales Force by 1,200 Positions

MERRILL LYNCH: Fitch Chips Ratings on $121.3MM Certificates
MERRILL LYNCH: Fitch Takes Rating Actions on Various Cert. Classes
MERRILL LYNCH: Fitch Affirm 'BB' Rating on Class B-2 Certificates
NAE OF KENDALL: Case Summary & Six Largest Unsecured Creditors
NIELSEN CO: S&P Revises Outlook on 'B' Rating to Stable from Neg.

NEXTEL CORP: S&P Lowers Ratings to 'BB' on Five Transactions
NORTH SHORE: Case Summary & Nine Largest Unsecured Creditors
NORTHWEST AIRLINES: Posts $4.1 Billion First Qtr. 2008 Net Loss
NORTHWEST AIRLINES: Merger with Delta to Result in 1,000 Cut Jobs
OFFICEMAX INC: Net Income Rises to $63MM in Quarter Ended March 29

ORIENT POINT: Fitch Junks Ratings on Five Note Classes
PAMPELONNE CDO: S&P Puts Default Ratings on 12 Classes of Notes
PLASTECH ENGINEERED: Seeks Permission to Wind Down Canadian Unit
PLASTECH ENGINEERED: Can Remove Pending Actions Until August 29
PLASTECH ENGINEERED: Agrees to Return Hyundai Tooling to JCI

PRB ENERGY: Wants To Use $2 Million Facility of Republic et al.
PRIME MORTGAGE: Moody's Cut Ba1 Rating to B3; Puts Under Review
QUALITY HOME: Weak Performance Prompts S&P to Cut Rating to B-
RADWAN & AFFES: Voluntary Chapter 11 Case Summary
RECYCLED PAPER: Payment Failure Prompts S&P's Default Ratings

RELIANT CHANNELVIEW: Plan Filing Period Extended to June 20
RESIDENTIAL CAPITAL: Commences Exchange Offer for $12.8 Bil. Notes
RESIDENTIAL CAPITAL: S&P Cuts Corp. Credit to CC on Debt Offer
RESIDENTIAL CAPITAL: Debt Exchange Offer Cues Fitch to Cut Rating
RESIDENTIAL CAPITAL: Moody's Cut Rating to Ca on Exchange Offer

ROYAL UTILITIES: S&P Cuts Rating to BB+ After Sherritt Acquisition
REYNOLDS AMERICAN: Debt Reduction Cues S&P to Lift Rating from BB+
SALISBURY INT'L: Fitch Slashes $33MM Note Rating to CC from A+
SEALY CORPORATION: March 2 Balance Sheet Upside-Down by $130MM  
SHAPES/ARCH HOLDINGS: Files Modified Disclosure Statement

SHARPS CDO: Fitch Cuts Rating to C from BB on $6.9 Million Notes
SPECIALTY UNDERWRITING: Fitch Downgrades Ratings on $97.5MM Certs.
SOLO CUP: Fitch Affirms Ratings and Revises Outlook to Positive
SOUTH FINANCIAL: Fitch Puts 'BB' Rating on $250MM Preferred Stock
STEVEN MOLASKY: Case Summary & 14 Largest Unsecured Creditors

STRUCTURED ASSET: Moody's Lowers Ratings on 57 Certificate Classes
ST. JOSEPH'S: Moody's Assigns Ba1 Rating on $236.6 Million Bonds
THOMAS WEISEL: To Slash 13% of Workforce First Half This Month
TOMARCON INC: Case Summary & 20 Largest Unsecured Creditors
TORO ABS: Fitch Slashes Rating to CCC from A- on $876.9MM Notes

TORO ABS: Fitch Chips BBB Rating to C and Removes Negative Watch
TOWERS OF CHANNELSIDE: Court Approves Disclosure Statement
TOWERS OF CHANNELSIDE: Plan Confirmation Hearing Set for May 28
TRIAD GUARANTY: Planned Mortgage Unit Cues Fitch to Lower Ratings
TRIAD GUARANTY: S&P Retains 'BB' Rating Under Negative Watch

TROPICANA ENTERTAINMENT: Files Chapter 11 Bankruptcy in Delaware
TROPICANA ENTERTAINMENT: Case Summary & 30 Largest Creditors
UAL CORPORATION: ReGen Insists Cure Amount Worth $4,272,555
UAL CORPORATION: Union Workers Denounce New Incentive Plan
US AIRWAYS: Incurs $236 Million Net Loss in First Quarter 2008

U.S. ENERGY: Wants Court to Set July 1 as Claims Bar Date
VERTIS INC: Inks Forbearance Agreement with Senior Noteholders
VICORP RESTAURANTS: U.S. Trustee Forms Seven-Member Committee
VILLAGE HOTEL: Gets Interim OK to Use Lender's Cash Collateral
VILLAGE HOTEL: Hires Lewis and Roca as Bankruptcy Counsel

WELLCARE HEALTH: S&P Retains 'B+' Credit Rating Under Neg. Watch
WESTAR ENERGY: Fitch Retains 'BB+' Rating Under Positive Watch
WIREFREE PARTNERS: S&P Cuts Lease-Backed Notes Rating to BB
WOLVERINE TUBE: Appoints William Evans to Board & Audit Committee

* Fitch Says Delinquencies on US Timeshare ABS Receded in 1Q'08
* Fitch Says Recessionary Pressures Are Among Concerns for Banks
* S&P Downgrades Ratings on Eight Tranches from Three Hybrid CDOs
* S&P Says Consumer Products Remains Susceptible to Economic Stir
* S&P Reports High-Yield Market Rebounded in Late March to April

* Large Companies with Insolvent Balance Sheets

                             *********

ADVANTAGE ONE: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Advantage One Mortgage Corp.
        8151 Peters Rd., Ste. 2000
        Plantation, FL 33324

Bankruptcy Case No.: 08-15308

Type of Business: The Debtor is a correspondent lender serving the
                  lending needs of real estate professionals,
                  builders and individual home buyers throughout
                  the US.  See http://www.advantage1mtg.com/

Chapter 11 Petition Date: April 28, 2008

Court: Southern District of Florida (Fort Lauderdale)

Judge: John K. Olson

Debtor's Counsel: David W. Langley, Esq.
                  Email: dave@flalawyer.com
                  8181 W. Broward Blvd., Ste. 204
                  Plantation, FL 33324
                  Tel: (954) 356-0450
                  Fax: (954) 356-0451

Total Assets:      $250

Total Debts: $1,816,519

Debtor's 19 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Internal Revenue Service       $550,000
Atlanta, GA 39901

SCP-Capri MG Owner             $241,971
Attn: David W. Black, Esq.
7805 S.W. 6 Ct.
Plantation, FL 33324

FIS Empower                    $239,381
50 S. Water Ave.
Sharon, PA 16146

California Franchise Tax Board $200,000

Dell Financial Services        $127,801

Colonial Bank                  $100,000

Kroll Factual Data             $68,552

Equifax Credit Marketing       $64,547

FIS Empower                    $61,760

Telepacific Communications     $46,798

Who's Calling                  $38,551

CIT Technology                 $21,165

The Turning Point              $12,365

Zurich North America           $8,509

Bricar Enterprises             $7,659

Wolters Kluwer                 $6,457

PAETEC/US LEC                  $5,794

CIT Technology                 $4,740

NCO Credit Services            $4,154


ALLIED HOLDINGS: Release Post-Confirmation Quarterly Report
-----------------------------------------------------------
Allied Holdings, Inc., and its 21 affiliates filed separate post-
confirmation quarterly operating reports for the period
Jan. 1, 2008, to March 31, 2008.

Allied Holdings reports total cash disbursements of $59,921,965
for the period.  Bank account balances reflect:

   Bank                               Account No.       Balance
   ----                               -----------       -------
   Bank of America                     9429019178      $138,203
   Fidelity National Bank                   59328         9,143
   LaSalle Bank                        5800299454        76,115
   LaSalle Bank                        5590056569             0
   LaSalle Bank                        5590056577             0
   LaSalle Bank                        5590056551             0
   LaSalle Bank                        5590056544             0
   LaSalle Bank                        5590056536             0      
   JPMorgan Chase                       904123677             0
   First Community Bank of Tifton         1900109             0
   LaSalle Bank                        5801012450       415,277
   Regions Bank                        6596012078        14,782
  
Counsel for the Reorganized Debtors, Kelly E. Culpin, Esq., at
Troutman Sanders LLP, in Atlanta, Georgia, delivered the post-
confirmation reports to the Court on April 30, 2008.

                      About Allied Holdings

Based in Decatur, Georgia, Allied Holdings Inc. (AMEX: AHI, other
OTC: AHIZQ.PK) -- http://www.alliedholdings.com/-- and its       
affiliates provide short-haul services for original equipment
manufacturers and provide logistical services.  The company and 22
of its affiliates filed for chapter 11 protection on July 31, 2005
(Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537).  Jeffrey W.
Kelley, Esq., at Troutman Sanders, LLP, represented the Debtors in
their restructuring efforts.  Henry S. Miller at Miller Buckfire &
Co., LLC, served as the Debtors' financial advisor.  Anthony J.
Smits, Esq., at Bingham McCutchen LLP, provided the Official
Committee of Unsecured Creditors with legal advice and Russell A.
Belinsky at Chanin Capital Partners, LLC, provided financial
advisory services to the Committee.  When the Debtors filed for
protection from their creditors, they estimated more than
$100 million in assets and debts.  

On May 11, 2007, the Court confirmed Allied's Second Amended
Chapter 11 Plan of Reorganization.  Allied emerged from
bankruptcy on May 29, 2007.  (Allied Holdings Bankruptcy
News, Issue No. 65; Bankruptcy Creditors' Service, Inc.
http://bankrupt.com/newsstand/or 215/945-7000)       

                          *     *     *

As of April 30, 2007, Allied Holdings Inc.'s consolidated balance
sheet showed $217,379,000 in total stockholders' deficit resulting
from total assets of $309,931,000 and total liabilities of         
$527,310,000.


ALOHA AIRLINES: Ch. 7 Trustee Sells Air Cargo Assets for $10.5MM
----------------------------------------------------------------
Dane S. Field, interim Chapter 7 Trustee for Aloha Airlines Inc.
and its debtor-affiliates, asks the Hon. Lloyd King of the United
States Bankruptcy Court for the District of Hawaii for authority
to sell the Debtors' "Air Cargo Assets" to Saltchuk Resources Inc.
for $10.5 million free and clear of all liens and encumbrances.

On May 1, 2008, Saltchuk and GMAC Commercial Finance LLC, the
Debtors' senior secured lender, entered into a letter of intent
for Saltchuk's purchase of the "Air Cargo Assets" from the
Debtors' bankruptcy estates.  The Air Cargo Assets handles 85%
of the cargo traffic in the state of Hawaii, including a contract
with the U.S. Postal Services.

Under the salient terms of the letter of intent include, among
other things:

   i) a $10.5 million purchase price;

  ii) a $1,000,000 earnest money deposit, including $500,000
      previously deposited;

iii) the assumption of aircraft and facility leases and other
      executory contracts, as selected by Saltchuk; and

  iv) a closing on or before May 14, 2008.

Furthermore, the letter of intent requires GMAC Financial to
finance the operation of the "Air Cargo Assets" pending the sale,  
Which GMAC Financial is only willing to fund until May 14, 2008.  

GMAC Financial agrees to carve-out a portion of the proceeds of
the sale for the benefit of the Debtors' estates, wherein 5% of
the proceeds, net of fees and expenses incurred in the sale, will
be paid to th Chapter 7 Trustee to pay expenses and fees.

A hearing is set for May 12, 2008, at 2:00 p.m., to consider
approval of the Debtors' request.

A full-text copy of the Letter of Intent is available for free
at http://ResearchArchives.com/t/s?2b70

As reported in the Troubled Company Reporter on April 25, 2008,
Saltchuk Resources lost the bid for Aloha Airlines Inc.'s contract
services operations to Pacific Air Cargo, which offered $2 million
for those assets.

As reported in the Troubled Company Reporter on April 30, 2008,
Judge King converted the Debtors' jointly administered Chapter 11
cases to liquidation proceedings under Chapter 7.

On May 1, 2008, Judge King authorized the Chapter 7 Trustee to
operate the Debtors' "Air Cargo Assets" under Section 721 of the
Bankruptcy Code until the closing date.

                        About Aloha Airlines

Based in Honolulu, Hawaii, Aloha Airgroup Inc., Aloha Airlines
Inc. -- http://www.alohaairlines.com/-- and its affiliates are          
carriers that fly passengers and freight to Hawaii's five major
airports, as well as to half a dozen destinations in the western
U.S.  They operate a fleet of about 20 aircraft, all Boeing 737s,
including three configured as freighters.

This is the airline's second bankruptcy filing.  Aloha filed for
Chapter 11 protection on Dec. 30, 2004 (Bankr. D. Hawaii Case No.
04-03063), and emerged from Chapter 11 bankruptcy protection in
February 2006.

The company and its affiliates filed again for Chapter 11
protection on March 18, 2008 (Bankr. D. Hawaii Lead Case No. 08-
00337).  Brian G. Rich, Esq., Jordi Guso, Esq., and Paul Steven
Singerman, Esq., at Berger Singerman P.A., and David C. Farmer,
Esq., represent the Debtors in their restructuring efforts.  When
the Debtors filed for protection from their creditors, they listed
estimated assets and debts of $100 million to $500 million.


AMERICHIP INT'L: Posts $969,582 Net Loss in 1st Qtr. Ended Feb. 29
------------------------------------------------------------------
Americhip International Inc. reported a net loss of $969,582 for
the first quarter ended Feb. 29, 2008, compared with a net loss of
$8,133,780 in the same period in 2007.

Revenues for the three months ended Feb. 29, 2008, increased from
$180,435 for the three months ended Feb. 28, 2007, to $921,472.  
This increase in revenues is primarily due to the acquisition of  
KSI Machine and Engineering Inc. during the year ending Nov. 30,
2007.

Operating expenses, which include administrative expenses, legal
and accounting expenses, consulting expenses and license expense
decreased from $8,206,896 for the three months ended Feb. 28,
2007, to $1,351,283 for the three months ended Feb. 29, 2008, a
decrease of $6,855,613.  This decrease is due to a significant
decrease in Director Fees and consulting expenses during the three
months ended Feb. 29, 2008.

Director Fees in 2007 were the result of the issuance of
restricted common stock to each of the company's directors in the
amount of $5,850,000.

The company said it anticipates that the operations of KSI Machine
and Engineering will bring to the consolidated balance sheet of
AmeriChip annual revenues of approximately $3,600,000 based on
revenues generated during the three months ended Feb. 29, 2008.

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on March 13, 2008,
Jewett, Schwartz, Wolfe & Associates, in Hollywood, Fla.,  
expressed substantial doubt about Americhip International Inc.'s
ability to continue as a going concern after auditing the
company's consolidated financial statements for the year ended
Nov. 30, 2007.  The auditing firm pointed to the company's  
recurring losses from operations.

At Feb. 29, 2008, the company had an accumulated deficit of
$33,129,549.  This compares with an accumulated deficit of
$32,159,967 at Nov. 30, 2007.

                          Balance Sheet

At Feb. 29, 2008, the company's consolidated balance sheet showed
$7,329,077 in total assets, $6,987,585 in total liabilities, and
$341,492 in total stockholders' equity.

The company's consolidated balance sheet at Feb. 29, 2008, also
showed strained liquidity with $1,245,544 in total current assets
available to pay $4,306,792 in total current liabilities.

Full-text copies of the company's consolidated financial
statements for the quarter ended Feb. 29, 2008, are available for
free at http://researcharchives.com/t/s?2b74

                  About AmeriChip International

Headquartered in Clinton Township, Mich., AmeriChip International
Inc. (OTC BB: ACHI.OB) -- http://www.americhiplacc.com/-- holds a  
patented technology known as Laser Assisted Chip Control, which
can be used to re-engineer the manufacturing process for
industrial metal machining applications.

According to AmeriChip International, this technology, when
implemented by the customer, will eliminate dangerous ribbon-like
steel chips that tangle around moving tool parts, automation
devices and other components essential to the machine processing
of low to medium grade carbon steels and non-ferrous metal parts.


AQUATIC CELLULOSE: Feb. 29 Balance Sheet Upside-Down by $4,576,529
------------------------------------------------------------------
Aquatic Cellulose International Corp.'s consolidated balance sheet
at Feb. 29, 2008, showed $1,095,311 in total assets and $5,671,840
in total liabilities, resulting in a $4,576,529 total
stockholders' deficit.

At Feb. 29, 2008, the company's consolidated balance sheet also
showed strained liquidity with $255,388 in total current assets
available to pay $5,671,840 in total current liabilities.

The company reported net income of $5,597,919 for the third
quarter ended Feb. 29, 2008, compared with net income of
$1,387,799 in the same period ended Feb. 28, 2007.  

For the three month period ended Feb. 29, 2008, and Feb. 28, 2007,
the company recorded other income of $5,672,083 and $1,538,103
respectively, associated with the company's 2003 and 2004
convertible debt.  

At Feb. 29, 2008, the estimated fair value of the company's
derivative liability was $1,709,352, as well as a warrant
liability of $2,447.  This compares with the estimated fair value
of the company's derivative liability of $7,138,823, as well as a
warrant liability of $17,991 at Nov. 30, 2007.

The company recognized its equity interest in Sargent South lease
in the amount of $147,506 for the three month period ended
Feb. 29, 2008, compared with $45,714 for the same period ended
Feb. 28, 2007.  The increase in equity interest is primarily due
to increased production and the overall increases in the selling
price of the company's natural gas.

                            Liquidity

At Feb. 29, 2008, the company had cash of $1,327 and total current
assets of $255,388.  In comparison, the company had cash of
$231,637 and total current assets of $233,071 at Nov. 30, 2007.

As of Feb. 29, 2008, the company had a working capital deficiency
of $5,416,452 and an accumulated deficit of $10,555,980, compared
with a working capital deficiency of $10,965,167 and an
accumulated deficit of $16,153,898 at Nov. 30, 2007.  

Over the next twelve months, management said it is confident that  
sufficient working capital will be obtained from a combination of
revenue and external financing to meet the company's cash
commitments as they become payable.  The company has in the past
successfully relied on private placements of common stock, loans
from private investors, sale of assets and the exercise of common
stock warrants, in order to sustain operations.  

Full-text copies of the company's consolidated financial
statements for the quarter ended Feb. 29, 2008, are available for
free at http://researcharchives.com/t/s?2b78

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on March 13, 2008,
Peterson Sullivan PLLC expressed substantial doubt about Aquatic
Cellulose International Corp.'s ability to continue as a going
concern after auditing the company's financial statements for the
years ended May 31, 2007, and 2006.  The auditing firm pointed to
the company's negative cash flow from operations during the year
ended May 31, 2007, and accumulated deficit at May 31, 2007.

The company continues to experience recurring losses.  In
addition, the company is receiving minimal cash flow from its oil
and natural gas investments.

                     About Aquatic Cellulose

Headquartered in B.C., Canada, Aquatic Cellulose International
Corp. (OTC: AQCI) is an independent oil and gas investment,
development and production company, engaged in the acquisition and
development of crude oil and natural gas reserves and production
initially in the state of Texas of the United States.

The company owns a 20 percent working interest and a 16 percent
net revenue interest in the Sargent South Field, Hamill & Hamill
lease, a 3,645-acre natural gas producing property located in
Matagorda County, Texas.  The company's interest applies to all
depths from surface to 7000 feet, with the exception of
three currently non-producing wells, number 19, 14 and 1-R, of
which the company has no interest in.  All of the company's South
Sargent interests, both onshore and offshore, are subject to the
company's Joint Operating Agreement with New Century Energy Corp.

The company also is a fifty percent working interest participant
in oil and gas leases comprised by the twenty five acre Isaac
Holliday tract in the William Cooper Survey in Waller County,
Texas (Brookshire Dome Field Area).


ASSET BACKED: Fitch Affirms 'B' Ratings on Four Cert. Classes
-------------------------------------------------------------
Fitch Ratings has taken rating actions on 10 Asset Backed Funding
Corporation mortgage pass-through certificates.  Unless stated
otherwise, any bonds that were previously placed on Rating Watch
Negative are now removed.  Affirmations total $683.2 million and
downgrades total $106.3 million.

ABFC 2003-AHL1 Total
  -- $11.5 million class AI affirmed at 'AAA';
  -- $19.9 million class M-1 affirmed at 'AAA';
  -- $4.3 million class M-2 affirmed at 'AA';
  -- $2.3 million class M-3 affirmed at 'A+';
  -- $0.8 million class M-4 affirmed at 'A';
  -- $1.2 million class M-5 affirmed at 'BBB+'.

Deal Summary
  -- Originators: Accredited Home Lenders, Inc. 100%
  -- 60+ day Delinquency: 15.34%
  -- Realized Losses to date (% of Original Balance): 1.34%

ABFC 2003-OPT1 Total
  -- $15.1 million class A-1 affirmed at 'AAA';
  -- $0.8 million class A-1A affirmed at 'AAA';
  -- $14.2 million class A-3 affirmed at 'AAA';
  -- $32.1 million class M-1 affirmed at 'AA+';
  -- $5.7 million class M-2 downgraded to 'A-' from 'A+';
  -- $1.5 million class M-3 downgraded to 'BBB+' from 'A';
  -- $1.5 million class M-4 downgraded to 'BBB-' from 'A-';
  -- $1.4 million class M-5 downgraded to 'BB' from 'BB+';
  -- $0.8 million class M-6 affirmed at 'B'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 16.98%
  -- Realized Losses to date (% of Original Balance): 0.98%

ABFC 2003-WF1
  -- $19.9 million class A-2 affirmed at 'AAA';
  -- $4.7 million class M-1 affirmed at 'AA';
  -- $2.4 million class M-2 affirmed at 'A+';
  -- $2.1 million class M-3 affirmed at 'BB';
  -- $0.1 million class M-4 affirmed at 'BB-'.

Deal Summary
  -- Originators: Wells Fargo Home Mortgage, Inc 100%
  -- 60+ day Delinquency: 12.71%
  -- Realized Losses to date (% of Original Balance): 1.20%

ABFC 2003-WMC1
  -- $23.0 million class M-1 affirmed at 'AAA';
  -- $8.0 million class M-2 affirmed at 'A+';
  -- $1.8 million class M-3 affirmed at 'A';
  -- $1.2 million class M-4 affirmed at 'BBB+';
  -- $1.1 million class M-5 affirmed at 'BBB';
  -- $0.6 million class M-6 affirmed at 'B'.

Deal Summary
  -- Originators: WMC Mortgage Corp. 100%
  -- 60+ day Delinquency: 10.80%
  -- Realized Losses to date (% of Original Balance): 0.75%

ABFC 2004-FF1
  -- $42.9 million class M-1 affirmed at 'AA-';
  -- $21.7 million class M-2 affirmed at 'BBB+';
  -- $7.2 million class M-3 downgraded to 'BB+' from 'BBB-';
  -- $1.9 million class M-4 affirmed at 'B';
  -- $1.9 million class M-5 affirmed at 'CC/DR4';
  -- $0.8 million class M-6 affirmed at 'C/DR6'.

Deal Summary
  -- Originators: First Franklin Financial Corporation 100%
  -- 60+ day Delinquency: 28.93%
  -- Realized Losses to date (% of Original Balance): 1.08%

ABFC 2004-OPT1
  -- $30.2 million class M-1 affirmed at 'AA+';
  -- $16.5 million class M-2 affirmed at 'A+';
  -- $2.0 million class M-3 affirmed at 'A';
  -- $1.9 million class M-4 downgraded to 'BBB+' from 'A-';
  -- $1.2 million class M-5 downgraded to 'BBB' from 'BBB+';
  -- $1.6 million class M-6 affirmed at 'B'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 18.44%
  -- Realized Losses to date (% of Original Balance): 1.12%

ABFC 2004-OPT2
  -- $4.2 million class A-1 affirmed at 'AAA';
  -- $0.5 million class A-1A affirmed at 'AAA';
  -- $0.4 million class A-2 affirmed at 'AAA';
  -- $27.0 million class M-1 affirmed at 'AA+';
  -- $21.6 million class M-2 affirmed at 'AA-';
  -- $3.8 million class M-3 affirmed at 'A+';
  -- $1.6 million class M-4 affirmed at 'A';
  -- $1.1 million class M-5 affirmed at 'BBB+';
  -- $1.5 million class M-6 affirmed at 'BBB';
  -- $0.3 million class B affirmed at 'BB+'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 11.91%
  -- Realized Losses to date (% of Original Balance): 0.64%

ABFC 2004-OPT3
  -- $13.8 million class A-1 affirmed at 'AAA';
  -- $9.2 million class A-4 affirmed at 'AAA';
  -- $34.3 million class M-1 affirmed at 'AA';
  -- $22.5 million class M-2 affirmed at 'A';
  -- $2.4 million class M-3 affirmed at 'A';
  -- $2.0 million class M-4 affirmed at 'A-';
  -- $1.2 million class M-5 affirmed at 'BBB'
  -- Zero balance class M-6 affirmed at 'BBB-'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 16.09%
  -- Realized Losses to date (% of Original Balance): 0.44%

ABFC 2004-OPT4
  -- $29.8 million class A1 affirmed at 'AAA';
  -- $6.1 million class A2 affirmed at 'AAA';
  -- $42.9 million class M1 affirmed at 'AA';
  -- $30.3 million class M2 downgraded to 'BBB+' from 'A-';
  -- $1.7 million class M3 downgraded to 'BBB' from 'BBB+';
  -- $2.6 million class M4 downgraded to 'BB+' from 'BBB-';
  -- $1.7 million class M5 downgraded to 'BB-' from 'BB+';
  -- $1.9 million class M6 downgraded to 'B' from 'BB-'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 18.58%
  -- Realized Losses to date (% of Original Balance): 0.63%

ABFC 2004-OPT5
  -- $86.0 million class A-1 affirmed at 'AAA';
  -- $29.7 million class A-4 affirmed at 'AAA';
  -- $53.9 million class M-1 affirmed at 'AA';
  -- $37.0 million class M-2 downgraded to 'BBB+' from 'A';
  -- $7.2 million class M-3 downgraded to 'BBB-' from 'A-';
  -- $3.4 million class M-4 downgraded to 'BB+' from 'BBB+'.

Deal Summary
  -- Originators: Option One Mortgage Corporation 100%
  -- 60+ day Delinquency: 18.57%
  -- Realized Losses to date (% of Original Balance): 0.50%


ATA AIRLINES: Final Hearing on Use of Cash Collateral on May 7
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
will convene a hearing May 7, 2008, to consider final approval of
ATA Airlines, Inc.'s request to use its lenders' cash collateral.

As reported by the Troubled Company Reporter on April 14, 2008,
ATA Airlines obtained permission, on an interim basis, to use the
cash collateral of its secured lenders to pay costs and expenses
associated with the wind-down of its business, the orderly
liquidation of its assets and the conduct of the Chapter 11 case.

ATA Airlines is a borrower under a $360,000,000 term loan with
JPMorgan Chase Bank, N.A., as administrative agent for certain
lenders.  ATA Airlines granted
to the Administrative Agent and the Secured Lenders liens and
security interests on its assets and property to secure its loan
obligations.

ATA Airlines has proposed to provide their lenders and JPMorgan
replacement security interests in, and liens on, all of its assets
in return for using their cash collateral.

Terry Hall, Esq., at Bakers & Daniels, LLP, in Indianapolis,
Indiana, has informed Judge Basil H. Lorch III that ATA Airlines
projects to use $23,585,000 of the cash collateral as set forth in
its 26-Week Forecast.  A full-text copy of the budget forecast is
available at no charge at:

   http://bankrupt.com/misc/ATA26WeekCashForecast

While it is not able to accurately assess the value of all its
assets at this time, ATA Airlines has said the estimated
liquidation value of the collateral it owns that secures its
obligations to the Secured Lenders is approximately $50,000,000.

The Port of Oakland is expected to show up at Thursday's hearing
to block the approval of ATA Airlines's request.  Port of Oakland
objects to the request to the extent the passenger facility
charges are included within the replacement liens.

Mark A. Salzberg, Esq., at Foley & Lardner LLP, in Washington,
D.C., says that passenger facility charges ATA Airlines' collects
are not property of the bankruptcy estate since ATA Airlines does
not have equitable or legal interest in those facility charges.   
According to Mr. Salzberg, ATA Airlines was required to collect
and remit to the Port certain passenger facility charges for using
the Port's facilities in the operation of its business.  Under the
Port's regulatory scheme, those facility charges are trust funds
collected by ATA Airlines and its agents, and held for the benefit
of the Port.

Mr. Salzberg says that ATA Airlines is not entitled to commingle
the facility charges and is required to segregate in a separate
account an amount of money equal to the average monthly liability
for the facility charges.

                      About ATA Airlines

Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military.  ATA is a wholly
owned subsidiary of New ATA  Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc.  ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007.  World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.

ATA Airlines and its affiliates filed for chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874).  The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006.  The Debtors'
emerged from bankruptcy on Feb. 28, 2006.

Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy.  The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.

ATA Airlines filed for Chapter 22 on April 2 (Bankr. S.D. Ind.
Case No. 08-03675), citing the unexpected cancellation of a key
contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business.  ATA discontinued all
operations subsequent to the bankruptcy filing.  ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.  (ATA Airlines Bankruptcy News,
Issue No. 80; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).


ATARI INC: To Merge with Infogrames Entertainment in $11MM Deal
---------------------------------------------------------------
Atari, Inc., and Infogrames Entertainment S.A. reached a
definitive agreement to merge, which:

   * brings to a close a period of financial underperformance for
     Atari;

   * strengthens Atari under Infogrames' new management team;

   * delivers a platform for future growth in the US; and

   * offers Atari shareholders an all cash exit.

Under the terms of the merger agreement, Infogrames will acquire
the remaining outstanding equity interests of Atari (other than
shares of common stock held by Infogrames or its affiliates, which
would be cancelled) for $1.68 per share, equivalent to a cash
payment of approximately $11 million.  Infogrames is currently the
majority shareholder in Atari holding approximately 51.4%.

Following the merger, Atari will be a wholly owned subsidiary of
Infogrames.  The merger will be funded by Infogrames from existing
cash resources.  The transaction is not subject to any financing
conditions and is expected to close in the third calendar quarter
of 2008.

This agreement is an essential and positive development for
Infogrames and its shareholders.  It brings Atari fully under the
control of Infogrames, delivering a platform for future growth in
the U.S.  This step closely follows a series of recent major
restructuring actions implemented in an effort to reposition
Atari, streamline its corporate structure and reduce its
annualized costs, including costs related to being a US public
company.

The Board of Infogrames believes that full ownership of a
restructured Atari is an important step for the Group, leading to
a simplified operating structure that will deliver greater
efficiency, provide the Group with greater opportunities to expand
its US distribution capabilities and strengthen its platform for
its global online initiatives.

"Bringing Atari US and Infogrames businesses together will enable
us to create a simplified global structure for our business as we
seek to re-build a well-managed, cohesive and financially
disciplined company," David Gardner, CEO, Infogrames, said.  "This
is a key strategic event for Infogrames that will benefit all of
our shareholders. I believe that this transaction will generate
significant benefits for the Group."

The management of Atari, Inc., led by recently appointed President
and CEO, Jim Wilson, will join the Group upon the closing of the
transaction and remain focused on growing the key North American
gaming market.

"By joining Infogrames, we will have the opportunity to further
transform Atari," Mr. Wilson said.  "As part of this newly
integrated company, we will be better able to streamline
operations and have a stronger platform for growth in North
America."

The transaction was negotiated and approved by the Special
Committee of the Board of Directors of Atari, consisting entirely
of directors who are independent of Infogrames.  In approving and
recommending the merger transaction, the Special Committee
considered, among other things, the terms of the merger agreement,
which permits the Special Committee to terminate the agreement
under certain circumstances, Atari's financial position and
results of operations, general market and industry conditions, the
risks of implementing Atari's business plan, Atari's limited
liquidity and the limited range of options available to Atari.  
The Special Committee also considered the effects of Infogrames'
controlling interest, the risk that the transaction will not be
completed, the premium to Atari's share price 30 days prior to the
date of Infogrames' offer, and the willingness of Infogrames to
extend a loan of up to $20 million to Atari to cover expected
capital requirements.

The transaction is subject to a number of customary conditions,
including the approval of the holders of a majority of outstanding
shares.  Atari expects to call a special meeting of shareholders
to consider the merger in the third quarter of calendar 2008.  
Since Infogrames controls a majority of Atari's outstanding
shares, Infogrames has the power to approve the transaction
without the approval of Atari's other shareholders.

In connection with the transaction, Infogrames has committed to
lend Atari $20 million, subject to the terms and conditions of the
credit agreement between Atari and Infogrames.  This loan will be
used to fund Atari's operational cash requirements during the
period between the date of the merger agreement and its closing.

                         About Atari Inc.

Headquartered in New York, Atari Incorporated, (NASDAQ: ATAR) --
http://www.atari.com/-- publishes and distributes interactive     
entertainment software in the U.S.  The company's 1,000+ published
titles distributed by the company include hard-core, genre-
defining franchises such as Test Drive(R); and mass-market and
children's franchises such Dragon Ball Z(R).  Atari Inc. is a
majority-owned subsidiary of France- based Infogrames
Entertainment SA, an interactive games publisher in Europe.

As reported in the Troubled Company Reporter on Feb. 20, 2008,
Atari Inc.'s consolidated balance sheet at Dec. 31, 2007, showed
$43.5 million in total assets and $60.3 million in total
liabilities, resulting in a $16.8 million total stockholders'
deficit.

                       Going Concern Doubt

New York-based Deloitte & Touche LLP expressed substantial doubt
about Atari's ability to continue as a going concern after
auditing the company's consolidated financial statements for the
year ended March 31, 2007.  The auditing firm pointed to the
company's significant operating losses.

As reported in the Troubled Company Reporter on March 28, 2008,
Atari Inc. received a Staff Determination Letter from the Nasdaq
Listing Qualifications Department stating that Atari Inc. has not
gained compliance with the requirements of Nasdaq Marketplace Rule
4450(b)(3), and that its securities are therefore subject to
delisting from The Nasdaq Global Market.

On Dec. 21, 2007, the Nasdaq Listing Qualifications Department
notified Atari Inc. that, pursuant to Nasdaq Marketplace Rule
4450(e)(1), unless the market value of Atari Inc.'s publicly held
shares, which is calculated by reference to Atari Inc.'s
total shares outstanding, less any shares held by officers,
directors or beneficial owners of 10% or more, maintains an
aggregate market value of $15 million or more for a minimum of
10 consecutive business days prior to March 20, 2008, Atari Inc.'s
securities would be subject to delisting.

As disclosed on March 21, 2008, the forbearance period granted by
BlueBay High Yield Investments (Luxembourg) S.A.R.L., the lender
under Atari's senior secured credit facility, has expired and
Atari is currently in discussions with BlueBay with respect to,
among other things, an extension of the forbearance period.


AVENTINE RENEWABLE: Liquidity Issues Cue S&P to Affirm 'B+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on ethanol producer Aventine Renewable Energy
Holdings Inc.  At the same time, S&P placed the rating on
CreditWatch with negative implications.  The company currently has
207 million gallons of annual production capacity, with an
additional 226 million gallons per year of capacity in
construction.  Marketing alliances, along with purchase and re-
sale activities, supplement the core revenues from equity
production.
     
The rating action is a result of the continued illiquidity of the
auction rate securities markets in which Aventine has about
$127.1 million invested.  The write-down has not affected the
company's cash position, and gross revenues have improved over the
last quarter.  However, the repeated failures of the monthly
auctions for various student loan asset-backed securities have
prevented the company from closing its position in these
securities, resulting in a liquidity shortfall in the midst of
continued construction of two new facilities in Aurora, Nebraska
and Mt. Vernon, Indiana Aventine is currently exploring options to
access additional capital.
     
"We believe that the majority of these options--along with those
we think Aventine is most likely to pursue--could have negative
implications for credit quality," said Standard & Poor's credit
analyst Justin Martin.
     
Aventine is still pursuing its expansion plans as construction
continues on the Aurora and Mt. Vernon dry-mill plants, each with
annual capacity of 113 mmgpy.  The company's liquidity position
remains tight during this build-out as the auction rate securities
market in which it has invested continues to experience failed
auctions.  The maximum rate paid on the SLABS reduces the negative
carry on the unsecured notes.  However, Aventine needs access to
the principal to pay for continued construction costs.  It is
exploring several financing options.
     
First-quarter results saw Aventine's realized ethanol price
increase by about 27 cents per gallon over the previous quarter,
outpacing the corn price increase (11 cents per gallon) for
improved EBITDA of $21.6 million for the quarter (versus
$49 million for all of 2007).  Aventine was able to use roughly
$24 million in cash from operations for this period and
$26 million from cash reserves for $50 million of construction
costs.  This leaves $250 million left to complete construction,
with roughly $200 million of liquidity available ($74 million cash
plus $130 million revolver availability), resulting in a
$50 million shortfall barring additional cash from operations.  
Given the volatility of historical earnings, no credit is given
for cash from operations in future quarters for the purpose of
this analysis.

To address the shortfall, Aventine is exploring several options,
the majority of which Standard & Poor's views as likely to detract
from credit quality.  However, precise details of the options are
not yet available, and the possibility of a credit-neutral
solution still exists.
     
S&P will resolve the CreditWatch when Aventine has determined a
strategy for addressing its projected liquidity shortfall.  If the
solution results in additional leverage or increased obligations
that significantly affect the break-even crush spreads, S&P could
lower the rating.  If Aventine can access capital on favorable
credit terms or reduce liquidity needs without hurting long-term
earnings potential, the outlook could be stabilized.


BENAZZI CDO: Fitch Junks Ratings on Three Note Classes
------------------------------------------------------
Fitch has downgraded 3 classes of notes issued by Benazzi CDO
2005-1, Ltd., and removed them from Rating Watch Negative.  These
rating actions are effective immediately:

  -- $20,000,000 class A notes to 'CC' from 'AAA';
  -- $50,000,000 class B notes to 'CC' from 'AA';
  -- $30,000,000 class C notes to 'CC' from 'A'.

Benazzi is a static synthetic collateralized debt obligation that
closed on Dec. 14, 2005 and is managed by Barclays Bank, PLC.  
Benazzi has a portfolio comprised primarily of subprime
residential mortgage-backed securities bonds (73%), Alternative-A
(Alt-A) (9%), structured finance (SF) CDOs (7%)other structured
finance assets.  Subprime RMBS bonds of the 2005 and 2006 vintages
account for approximately 72% and 1% of the portfolio,
respectively.  Likewise, the SF CDO exposure includes SF CDO
originated in 2005 (7%).  Alt-A RMBS bonds issued in 2005
represent approximately 9% of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS, and SF CDOs with underlying exposure to subprime RMBS.  
Since the beginning of 2007, approximately 78% of the portfolio
has been downgraded, with 7% of the portfolio currently on Rating
Watch Negative.  The negative credit migration started in the
second half of 2007 and has continued through the present.

The ratings address the timely receipt of interest and ultimate
receipt of principal.  The ratings are based upon the credit
quality of the reference portfolio, the financial strength of
Barclays as the swap counterparty, the credit quality of the
collateral assets and the legal structure of the transaction.  
Fitch will continue to monitor and review this transaction for
future rating adjustments.


BERNOULLI HIGH: Fitch Lowers Ratings on Six Note Classes
--------------------------------------------------------
Fitch downgraded six classes of notes issued by Bernoulli High
Grade CDO I, Ltd./Inc.

These rating actions are effective immediately:

  -- $880,448,158 class A-1A notes downgraded to 'B' from 'AAA'
     and remain on Rating Watch Negative;

  -- $358,463,312 class A-1B notes downgraded to 'A' from 'AAA'
     and placed on Rating Watch Negative;

  -- $86,536,865 class A-2 notes downgraded to 'CCC' from 'AAA'
     and removed from Rating Watch Negative;

  -- $57,691,244 class B notes downgraded to 'CC' from 'AA' and
     removed from Rating Watch Negative;

  -- $14,648,712 class C notes downgraded to 'C' from 'A' and
     removed from Rating Watch Negative;

  -- $14,719,804 class D notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative.

Bernoulli is a static hybrid cash and synthetic collateralized
debt obligation that closed on March 30, 2006 and is monitored by
Babcock & Brown Securities Pty, Ltd.  Bernoulli has a portfolio
comprised of subprime residential mortgage-backed securities  
bonds (36.5%), structured finance CDOs (32.1%), Alternative-A  
RMBS (27.1%), and prime RMBS (4.3%).  Subprime RMBS bonds of the
2005 and 2006 vintages account for approximately 32.6%, and 3.9%
of the portfolio, respectively.  SF CDO exposure includes SF CDOs
originated in 2004 (18%), 2005 (11.7%) and 2006 (2.4%) and Alt-A
RMBS of the 2005 and 2006 vintages represent approximately 13.3%
and 13.8% of the portfolio, respectively.  Approximately 75% of
the assets are owned as cash bonds, with the remaining 25%
referencing SF CDOs via credit default swaps.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS and SF CDOs with underlying exposure to subprime RMBS.  
Since the last review on May 18, 2007, approximately 56.5% of the
portfolio has been downgraded, with 34.7% of the portfolio
currently on Rating Watch Negative.  Approximately 28.4% of the
portfolio is now rated below investment grade.  According to the
March 28, 2008 trustee report, the weighted average rating factor
is 5.1 ('BBB/BBB-'), failing its covenant of 1.4 ('AA-/A+'), and
approximately $12 million of the portfolio is considered
defaulted.

The class A/B coverage test is failing at 99.7% compared to a
trigger of 101.69%, causing the class C and D notes to pay-in-
kind.  Considering that the class B notes are undercollateralized,
it is unlikely the A/B coverage test will cure in the future, and
therefore unlikely that the class C and D notes will receive any
payments going forward.

Fitch believes that the portion of the portfolio rated 'AAA' and
'AA', 20.5% and 28% respectively, provides enough credit
enhancement to the class A-1B notes to maintain an investment
grade rating.  The class A-1B notes are viewed as the most senior
class in the capital structure.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A RMBS.  The classes rated 'CCC' and below are
removed from Rating Watch as Fitch believes further negative
migration in the portfolio will have a lesser impact on these
classes.  Additionally, Fitch is reviewing its SF CDO approach and
will comment separately on any changes and potential rating impact
at a later date.

The ratings of the class A-1A, A-1B, A-2 and B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.  
The ratings of the class C and D notes address the likelihood that
investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


BI-LO LLC: Weak Performance Cues S&P to Revise Outlook to Neg.
--------------------------------------------------------------
Standard & Poor's Ratings Services revised the outlook on
Greenville, South Carolina-based BI-LO LLC to negative from
stable.  The 'B' corporate credit rating remains unchanged.
     
"The outlook revision reflects operating performance that weakened
in the second half of fiscal year 2007," said Standard & Poor's
credit analyst Jackie E. Oberoi, "leading to credit metrics that
are now weak for the rating."  Leverage, for example, is now in
the mid-5x range.


BLOUNT INTL: Acquires Carlton Holdings for $63,000,000
------------------------------------------------------
Blount International Inc. acquired all the capital stock of
Carlton Holdings Inc. from its private shareholders.  Blount paid
approximately $63 million in net consideration for the stock,  
funded through the company's revolving credit facility.

"The acquisition of Carlton is consistent with our intention to
invest in and grow our core business, the Outdoor Products
segment," James Osterman, Blount's chairman and CEO, said.  "The
added capacity and potential operating synergies of the combined
entities make Carlton an attractive asset to own.  

"Carlton's strengths in international markets where over 80% of
their sales take place, fits well with our expansion plans and the
additional capacity will accelerate the opportunities to take
advantage of the weakened U.S. dollar in trading," Mr. Osterman
added.

                     About Carlton Holdings Inc.

Located in Milwaukie, Oregon, Carlton Holdings Inc. is a
manufacturer of saw chain.  Carlton employs approximately 400
employees, most at its Oregon manufacturing facility, and
distributes the majority of its products to international markets.
The company was founded in 1963.

                    About Blount International

Blount International Inc. (NYSE: BLT) -- http://www.blount.com/--     
is a diversified international company operating in two
principal business segments: Outdoor Products and Industrial and
Power Equipment.  The company's Outdoor Products segment provides  
chain, bars and sprockets to the chainsaw industry, accessories to
the lawn care industry and concrete cutting saws.

As reported in the Troubled Company Reporter on April 29, 2008,
Blount International Inc.'s balance sheet at Dec. 31, 2007, showed
total assets of $411.9 million and total liabilities of
$466.0 million, resulting in a total shareholders' deficit of
$54.1 million.


BRODERICK CDO: Poor Collateral Cues Fitch to Downgrade Ratings
--------------------------------------------------------------
Fitch downgrades six classes of notes issued by Broderick CDO 1
Ltd.  These rating actions are effective immediately:

  -- $238,526 class A-1V notes downgraded to 'B' from 'AAA' and
     remain on Rating Watch Negative;

  -- $338,468,979 class A-1NVA notes downgraded to 'B' from 'AAA'
     and remain on Rating Watch Negative;

  -- $462,741,239 class A-1NVB notes downgraded to 'B' from 'AAA'
     and remain on Rating Watch Negative;

  -- $81,650,000 class A-2 notes downgraded to 'CC' from 'AAA' and
     removed from Rating Watch Negative;

  -- $41,304,634 class B notes downgraded to 'CC' from 'AA' and
     removed from Rating Watch Negative;

  -- $21,642,610 class C notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative.

Broderick is a cash collateralized debt obligation that closed on
Dec. 13, 2005, and is managed by SCM Advisors LLC.  Broderick's
substitution period ended on April 3, 2008.  The portfolio is
comprised primarily of subprime residential mortgage-backed
securities bonds (44.3%), Alternative-A RMBS (30.4%), and
structured finance CDOs (15.5%).  Subprime RMBS, Alt-A RMBS and SF
CDO bonds originated in 2005 account for approximately 42.4%,
30.2%, and 10.8% of the portfolio, respectively.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically in subprime RMBS,
Alt-A RMBS, and SF CDOs with underlying exposure to subprime RMBS.  
Since the beginning of 2007, approximately 40.6% of the portfolio
has been downgraded, and 19.2% of the portfolio is currently on
Rating Watch Negative.  Approximately 25.1% of the portfolio is
now rated below investment grade.  The negative credit migration
is primarily attributable to credit deterioration in subprime RMBS
and SF CDO bonds from the 2005 vintage.

While the most recent trustee report from March 25, 2008 shows
that the class A/B overcollateralization test is passing at 102.7%
compared to a trigger of 102.01%, Fitch expects the test to be
failing now due to additional downgrades in the portfolio.  Based
on this expectation, the class C notes are unlikely to receive any
interest or principal payments going forward.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A RMBS.  The classes rated 'CCC' and below are
removed from Rating Watch as Fitch believes further negative
migration in the portfolio will have a lesser impact on these
classes.  Additionally, Fitch is reviewing its SF CDO approach and
will comment separately on any changes and potential rating impact
at a later date.

The ratings of the class A-1N, A-1NVA, A-1NVB, A-2 and B notes
address the likelihood that investors will receive full and timely
payments of interest, as per the transaction's governing
documents, as well as the stated balance of principal by the legal
final maturity date.  The rating of the class C notes addresses
the likelihood that investors will receive ultimate and
compensating interest payments, as per the transaction's governing
documents, as well as the stated balance of principal by the legal
final maturity date.


BSML INC: Andrew Rudnick Resigns as CEO and Board Chairman
----------------------------------------------------------
Andrew Rudnick resigned as the Chief Executive Officer and
Chairman of BSML, Inc., effective April 25, 2008.

In connection with Mr. Rudnick's resignation, the company and Mr.
Rudnick entered into a Separation and Release of Claims Agreement,
effective as of April 25, 2008.  The company and Sleek Inc., an
entity controlled by Mr. Rudnick, also entered into an Amended and
Restated Support Services Agreement, which amended and restated a
prior agreement dated Dec. 6, 2007.

Pursuant to the Separation Agreement, the company agreed to pay
Mr. Rudnick a total of $495,000 in severance pay as follows:

   (1) $72,500 on the effective date of the Agreement;

   (2) $72,500 on the first to occur of:

       (i) thirty (30) days after the Effective Date or

      (ii) that date that BSML receives $1 million in equity
           financing from its new CEO or his affiliates; and

   (3) $350,000 paid by the company to Rudnick over a 12 month
       period in accordance with the company's payroll practices
       in effect as of the effective date of the Separation
       Agreement, the first payment to commence on that date which
       is sixty days after the effective date and continue each
       month thereafter until paid in full.

Additionally, the company agreed to pay to Sleek $50,105 upon
execution of the Separation Agreement by Mr. Rudnick, which sum
constituted advance payment for the support services Sleek agreed
to provide to the company under the Amended Services Agreement
during his term.  The company and Rudnick agreed that in the event
that Sleek determines, in Sleek's reasonable opinion, that the
cost of the support services Sleek provides to the Company under
the Amended Support Services Agreement for the applicable period
exceeds $50,105, the company will promptly pay Sleek such
additional amounts once invoiced by Sleek.  Mr. Rudnick and Sleek
acknowledged and agreed that Sleek had already received payment
from the company for the support services Sleek provided BSML
through April 18, 2008.

In consideration of the company's entering into the Separation
Agreement, Mr. Rudnick and Sleek, as applicable, agreed that Mr.
Rudnick's Employment Agreement is terminated and of no further
force or effect provided, however, that Section 7(o) of the
Employment Agreement will survive and remain in full force and
effect.  Mr. Rudnick also agreed, on behalf of Sleek, to provide
consulting services to the Company after the execution of the
Separation Agreement pursuant to the Amended Services Agreement.

                   Amended Services Agreement

The Amended Services Agreement modified and restated a prior
Support Services Agreement between the company and Sleek dated
Dec. 6, 2007.

Pursuant to the Amended Services Agreement, Sleek agreed to
provide these services:

   (i) marketing advice, consulting and strategy for all products
       and services offered by the customer;

  (ii) fulfillment of all product requirements;

(iii) training of the Customer's personnel;

  (iv) timely billing to and collecting from all customers, and
       accounts receivable;

   (v) cash management;

  (vi) personnel management;

(vii) timely preparation and filing of the customer's tax and
       regulatory returns and other necessary governmental
       filings;

(viii) providing information technology services;

  (ix) providing data processing services;
  
   (x) maintenance of records in accordance with procedures
       mutually agreed upon by the parties;

  (xi) providing technical services for the Customer and its
       business; and

(xii) call center management and operations.

As consideration for providing the services, the company agreed to
pay Sleek a monthly administrative fee equal to the aggregate of
Sleek's actual costs, fees, expenses incurred by or on behalf of
Sleek in connection with, or related to the provision of the
Services under the Amended Services Agreement, including, without
limitation, salaries, wages, and other compensation paid to
employees -- excluding salary or other compensation paid to Andrew
Rudnick -- and approved by Sleek to perform the Services, the cost
of employee benefits attributable to such approved employees,
communications, and any other operating expenses of Sleek.  
However, in no event will compensation paid to, and the costs of
benefits attributable to, Sleek employees not approved by the
Company be included in Base Costs.  The Administrative Fee is to
be paid on the first of every month following the month in which
Sleek bills the company for Services during the term of the
Amended Services Agreement.  However, upon Execution of the
Amended Services Agreement, the company paid the Administrative
Fee through May 31, 2008, in the amount of $50,105.

                        About BSML Inc.

Based in Walnut Creek, California, BSML Inc. (NasdaqCM: BSML) --
http://www.britesmile.com/-- markets teeth whitening technology
and manages BriteSmile Professional Teeth Whitening Centers.

                       Going Concern Doubt

Stonefield Josephson, Inc., raised substantial doubt about the
ability of BSML, Inc., to continue as a going concern after it
audited the company's financial statements for the year ended
Dec. 29, 2007.  


BSML INC: Appoints Jeffrey Nourse as New Chief Executive
--------------------------------------------------------
The Board of Directors of BSML, Inc., appointed Jeffrey Nourse as
its chief executive officer effective as of April 25, 2008, to
replace Andrew Rudnick.

The company's Board of Directors also appointed Anthony M. Pilaro
as the company's Chairman of the Board of Directors.  The Board
also appointed Mr. Nourse as a Director of the company.

Jeffrey Nourse, 41, is a successful entrepreneur with a long
career with retail growth companies.  From 1985 to 2001, Mr.
Nourse was the founder and CEO of Canada's largest wholesale auto
body supply centers.  From 2002 to the present, he was the founder
and CEO of the second largest med spa company in North America.  
The company will provide information regarding Mr. Nourse's
compensation once it has been finalized.

Mr. Pilaro had previously served as the Chairman of the company's
Board of Directors since 1997 through February 2008.  Presently,
he serves as Chairman of CAP Advisers Limited, with offices in
Dublin, Ireland, and which serves as a family office for the
business affairs of the Pilaro family.  He is also founder and
Chairman of Excimer Vision Leasing L.P., a partnership primarily
engaged in the business of leasing Excimer laser systems.

Mr. Pilaro was Chairman of both CAP and Excimer Vision Leasing for
the last 5 years except for the period from August 2004 to
February 2005.  Mr. Pilaro has been involved in private
international investment banking.  He was a Founding Director and
former Chief Executive Officer of Duty Free Shoppers Group
Limited, the world's leading specialty retailer catering to
international travelers, and a founder of the predecessor of VISX,
Inc.  A graduate of the University of Virginia and the University
of Virginia Law School, Mr. Pilaro practiced law in New York City
through 1964.

                        About BSML Inc.

Based in Walnut Creek, California, BSML Inc. (NasdaqCM: BSML) --
http://www.britesmile.com/-- markets teeth whitening technology
and manages BriteSmile Professional Teeth Whitening Centers.

                       Going Concern Doubt

Stonefield Josephson, Inc., raised substantial doubt about the
ability of BSML, Inc., to continue as a going concern after it
audited the company's financial statements for the year ended
Dec. 29, 2007.


BUCHANAN ENTITIES: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Buchanan Entities, LLC
        20 Beech Lane
        Tarrytown, NY 10591

Bankruptcy Case No.: 08-22596

Chapter 11 Petition Date: April 28, 2008

Court: Southern District of New York (White Plains)

Debtor's Counsel: Jonathan S. Pasternak, Esq.
                  Email: jsp@rattetlaw.com
                  Rattet, Pasternak & Gordon Oliver, LLP
                  550 Mamaroneck Ave., Ste. 510
                  Harrison, NY 10528
                  Tel: (914) 381-7400
                  Fax: (914) 381-7406
                  http://www.rattetlaw.com

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

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


C-BASS CBO: Fitch Slashes AA Rating to CCC on $29 Million Notes
---------------------------------------------------------------
Fitch Ratings has downgraded four classes of notes issued by
C-BASS CBO XIV Ltd. and one class of notes remains on Rating Watch
Negative.  These rating actions are effective immediately:

  -- $336,999,562 class A notes downgraded to 'B' from 'AAA' and
     remains on Rating Watch Negative;

  -- $29,000,000 class B notes downgraded to 'CCC' from 'AA' and
     removed from Rating Watch Negative;

  -- $30,000,000 class C notes downgraded to 'CC' from 'A' and
     removed from Rating Watch Negative;

  -- $17,060,000 class D notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative.

C-BASS XIV is a collateralized debt obligation that closed on
Sept. 22, 2005 and has a static portfolio that was selected by
C-BASS Investment Management, LLC. C-BASS XIV has a portfolio
comprised primarily of subprime residential mortgage-backed
securities bonds (65.6%), Alternative-A (Alt-A) RMBS (17.5%), and
other diversified structured finance assets.  Subprime RMBS bonds
of the 2005 vintage account for approximately 60.5% of the
portfolio.  Alt-A RMBS bonds of the 2005 vintage represent
approximately 13.2% of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS.  
Since the beginning of 2007 approximately 53.1% of the portfolio
has been downgraded, and 4.7% of the portfolio is currently on
Rating Watch Negative.  The negative credit migration is primarily
attributable to credit deterioration in subprime RMBS bonds from
the 2005 vintage.

As of the March 31, 2008 trustee report approximately
$26.1 million (5.9%) of the portfolio, consisting of subprime RMBS
assets, was considered to be defaulted.  As a result of the
collateral deterioration, C-BASS XIV is currently failing its
class C and class D overcollateralization tests.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS, as well as growing concerns with
the performance of Alt-A RMBS.  Additionally, Fitch is reviewing
its SF CDO approach and will comment separately on any changes and
potential rating impact at a later date.

The ratings of the class A and class B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.  
The ratings of the class C and class D notes address the
likelihood that investors will receive ultimate and compensating
interest payments, as per the transaction's governing documents,
as well as the stated balance of principal by the legal final
maturity date.


CALAMOS INVESTMENTS: To Refinance $300MM of Preferred Stocks
------------------------------------------------------------
Calamos Investments intends to refinance $300 million of the
outstanding auction rate preferred securities issued by the
Calamos Global Dynamic Income Fund.

The company relates that this transaction comes a week after
Calamos disclosed the refinancing of an aggregate of $939 million
of outstanding ARPs of the Calamos Global Total Return Fund and
the Calamos Strategic Total Return Fund.

"We have stressed all along that we would work rapidly to secure
solutions to the recent liquidity crisis in the ARPs market," said
John P. Calamos, Sr., the chairman, chief executive officer and
co-chief investment officer of Calamos Investments.  "We are
committed to seeing this issue through to a successful resolution
across our entire fund complex, and we want our fund shareholders
to know that we have been and will continue to focus on finding
solutions for all of our closed-end fund shareholders."

Calamos has secured an alternative form of borrowing that will
enable, based on current market conditions, CHW to redeem
approximately 85.7% or $300 million of its outstanding ARPs at
their par value.  

The refinancing comes in the form of the first money market
eligible extendible note to be issued by a closed-end fund.  This
refinancing, together with the previous refinancings of CGO and
CSQ, represents $ 1.239 billion or approximately 53.8% of the
total auction rate preferred outstanding in the five Calamos
closed-end funds.

Upon completion of the refinancing, which has been approved by the
board of trustees of CHW, the leverage ratio for the fund is not
expected to change materially and the funds will continue to meet
the asset coverage requirements of the Investment Company Act of
1940.

Since the amount of refinancing for CHW is less than the total
amount outstanding, this refinancing will take place pro rata by
auction series.  It is important to note that the Depository Trust
Company, the securities' holder of record, will determine how to
allocate this partial redemption of shares among each participant
broker-dealer account.  Each participant broker-dealer, as nominee
for underlying beneficial owners, in turn will determine how
redeemed shares are allocated among its beneficial owners.

The date will show the shares outstanding per series and the
number that the fund will redeem via this refinancing:

   a) CHW Auction Series: Monday                              
      CUSIP: 12811L206      
      Shares to be redeemed/outstanding: 2,400/2,800
      Redemption Percent:  85.7 %           
      Redemption Amount: $60,000,000

   b) CHW Auction Series: Tuesday                               
      CUSIP: 12811L305     
      Shares to be redeemed/outstanding: 2,400/2,800
      Redemption Percent: 85.7 %          
      Redemption Amount: $60,000,000

   c) CHW Auction Series: Wednesday                              
      CUSIP: 12811L404     
      Shares to be redeemed/outstanding: 2,400/2,800
      Redemption Percent: 85.7 %          
      Redemption Amount: $60,000,000

   d) CHW Auction Series: Thursday                               
      CUSIP:12811L503       
      Shares to be redeemed/outstanding: 2,400/2,800
      Redemption Percent: 85.7 %         
      Redemption Amount: $60,000,000

   e) CHW Auction Series: Friday                                  
      CUSIP: 12811L602      
      Shares to be redeemed/outstanding: 2,400/2,800
      Redemption Percent: 85.7 %          
      Redemption Amount: $60,000,000
    
The fund expects to begin issuing redemption notices in the next
several days and redemptions will coincide with the completion of
the refinancing transaction.

                   About Calamos Investments

Headquartered in Naperville, Illinois, Calamos Investments --
http://www.calamos.com-- is a diversified investment firm    
offering equity, fixed-income, convertible and alternative
investment strategies, among others. The firm serves institutions
and individuals via separately managed accounts and a family of
open-end and closed-end funds, providing a risk-managed approach
to capital appreciation and income-producing strategies.


CATHOLIC CHURCH: Fairbanks' Creditors Wants Pachulski as Counsel
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of the Catholic
Bishop of Northern Alaska, aka The Roman Catholic Diocese of
Fairbanks in Alaska, sought authority from the U.S. Bankruptcy
Court for the District of Alaska to retain Pachulski Stang Ziehl &
Jones LLP as its counsel.

As counsel to the Creditors Committee, Pachulski will:

   a. assist, advise and represent the Creditors Committee in its
      consultations with the Diocese regarding the administration
      of the Diocese's Chapter 11 case;

   b. assist, advise and represent the Creditors Committee in
      analyzing the Diocese's assets and liabilities, investigate
      the extent and validity of liens and participate in and
      review any proposed asset sales, any asset dispositions,
      financing arrangements and cash collateral stipulations or
      proceedings;
       
   c. assist, advise and represent the Creditors Committee in any
      manner relevant to reviewing and determining the Diocese's
      rights and obligations under leases and other executory
      contracts;

   d. assist, advise and represent the Creditors Committee in
      investigating the acts, conduct, assets, liabilities and
      financial condition of the Diocese, the Diocese's
      operations and the desirability of the continuance of any
      portion of those operations, and any other matters relevant
      to the Chapter 11 case or to the formulation of a plan;
   
   e. assist, advise and represent the Creditors Committee in its
      participation in the negotiation, formulation and drafting
      of a plan of liquidation or reorganization;

   f. advise the Creditors Committee on the issues concerning the   
      appointment of a trustee or examiner under Section 1104 of
      the Bankruptcy Code;

   g. assist, advise and represent the Creditors Committee in
      understanding its powers and its duties under the
      Bankruptcy Code and the Bankruptcy Rules and in performing
      other services as are in the interests of those represented
      by the Creditors Committee;

   h. assist, advise and represent the Creditors Committee in the
      evaluation of claims and on any litigation matters,
      including avoidance actions; and

   i. provide other services to the Creditors Committee as may be
      necessary in the Chapter 11 case.

Pachulski and the Creditors Committee agreed that:

   (a) no retainer will be paid to the Firm;

   (b) neither the Creditors Committee nor any of its member will
       be liable for any fees or costs incurred by the Firm;

   (c) the Firm will charge a blended hourly rate of:

       -- $480 for partners and counsel attorneys,
       -- $350 for associates, and
       -- $180 for paralegal services; and

   (d) the Firm will seek reimbursement of expenses at its cost
       or as otherwise allowed by the Court.

The Firm received $35,000 from the Diocese before the
commencement of the bankruptcy case for fees and expenses related
to the representation of a prepetition unofficial committee.  Of
the $35,000, $10,000 was forwarded to David Bundy, local counsel
for the prepetition unofficial committee.

James I. Stang, Esq., a partner at Pachulski Stang Ziehl & Jones
LLP, assured the Court 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).

                    About Diocese of Fairbanks

The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic
Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka
The Diocese of Fairbanks, aka CBNA filed for chapter 11 bankruptcy
on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110).  Susan G.
Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its
restructuring efforts.  Michael R. Mills, Esq., of Dorsey &
Whitney LLP serves as the Debtor's local counsel and Cook,
Schuhmann & Groseclose Inc. as its special counsel.  Judge Donald
MacDonald, IV, of the United States Bankruptcy Court for the
District of Alaska presides over Fairbanks' Chapter 11 case.  The
Debtor's schedules show total assets of $13,316,864 and total
liabilities of $1,838,719.   The church's exclusive plan filing
period expires on June 29, 2008.  (Catholic Church Bankruptcy
News, Issue No. 123; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


CATHOLIC CHURCH: Fairbanks' Creditors Wants Bundy as Co-Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of the Catholic
Bishop of Northern Alaska, aka The Roman Catholic Diocese of
Fairbanks in Alaska, sought authority from the U.S. Bankruptcy
Court for the District of Alaska to retain David H. Bundy as
assistant counsel to Pachulski Stang Ziehl & Jones LLP.  

The Creditors Committee has decided to retain David Bundy since
he has extensive experience in bankruptcy representation.  Mr.
Bundy is expected to assist the Creditors Committee and Pachulski
in the Diocese's Chapter 11 case.

Mr. Bundy will charge $300 per hour and will seek reimbursement
of expenses as allowed by the Court.  Mr. Bundy received $10,000
from the Diocese before the commencement of the case for fees and
expenses related to the representation of a prepetition
unofficial committee.

Mr. Bundy assured the Court 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).

                    About Diocese of Fairbanks

The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic
Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka
The Diocese of Fairbanks, aka CBNA filed for chapter 11 bankruptcy
on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110).  Susan G.
Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its
restructuring efforts.  Michael R. Mills, Esq., of Dorsey &
Whitney LLP serves as the Debtor's local counsel and Cook,
Schuhmann & Groseclose Inc. as its special counsel.  Judge Donald
MacDonald, IV, of the United States Bankruptcy Court for the
District of Alaska presides over Fairbanks' Chapter 11 case.  The
Debtor's schedules show total assets of $13,316,864 and total
liabilities of $1,838,719.   The church's exclusive plan filing
period expires on June 29, 2008.  (Catholic Church Bankruptcy
News, Issue No. 123; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


CHALLENGER POWERBOATS: Auditor Raises Going Concern Doubt
---------------------------------------------------------
Jaspers + Hall PC raised substantial doubt on the ability of
Challenger Powerboats Inc. to continue as a going concern after
auditing the company's annual report for 2007.  The auditor
pointed to the company's current liabilities that exceed current
assets by $1,722,562 as of Dec. 31, 2007.  The auditor said that
the company had operating losses of $7,046,691 and $5,211,514 in
2007 and 2006, respectively and has ceased operations.  The
auditor continued that the company's recurring losses from
operations and its difficulties in generating sufficient cash flow
to meet its obligation and sustain its operations.

For the year ended Dec. 31, 2007, the company generated net
revenues of $7,399,703, as compared to net revenues of $238,171
for the year ended Dec. 31, 2006.  During 2007, the major change
in its business which impacted revenues was primarily due to the
addition of IMAR, which we acquired in January 2007.

The company had a net loss of $4,656,940 for the 12 months ended
Dec. 31, 2007, as compared to $9,133,144 for the 12 months ended
Dec. 31, 2006.  The year-over-year net loss decreased primarily
due to the sale of the Sugar Sand product line to Execute Sports,
Inc for $5,000,000 in August 2007.

                  Liquidity and Capital Resources

As of Dec. 31, 2007, the company had total current assets of
$2,769,550, compared to $1,991,808 as of Dec. 31, 2006.  This was
due primarily to an increase in accounts receivable and inventory
as a result of the acquisition of IMAR Group, LLC.  As of Dec. 31,
2007, the company had total current liabilities of $4,492,112,
compared to $5,983,083, as of Dec. 31, 2006.  This was due
primarily to a $1,872,216 increase in accounts payable and accrued
payables, a  $510,877 increase in warranty reserve which were
offset with a $722,125 decrease in accrued interest as a result of
the Sept. 30, 2007 debt conversion, as well as a $2,976,054
reduction of related party debt to Dutchess.

During 2007, the company did not issue any promissory notes to
related parties.  As of Dec. 31, 2007, a total of $0 was owed to
related parties for promissory notes.  The outstanding balances of
$3,083,454 on related party promissory notes were included in the
Sept. 30, 2007 Series A Convertible Preferred Stock Purchase
Agreement with Dutchess.

As of Dec. 31, 2007, the company had debt of $11,301,142,
including convertible debentures which total $3,725,041.  The
company accrue monthly interest expense on the debt under its
convertible debentures, which are due in 2009, 2010, 2011 and
2012.

As of Dec. 31, 2007, the company's balance sheet showed total
assets of $6,408,050, total liabilities of $11,301,142, and total
stockholders' deficit of $4,893,092.

            Management's Analysis and Financial Warning

According to the company's management, Challenger Powerboats did
not generate positive cash flows and is required to make large
debt service payments.  Consequently, the company continues to
require additional funding at this time.  It may be able to secure
funding from current investors, but there is no assurance it will
be able to do so.  If the company is unable to generate sufficient
cash flow or obtain funds for required payments, or if it fails to
comply with the covenants in its debt, the company will be in
default.  Accordingly, it may not be able to able to meet its debt
service obligations and may be forced to consider alternative
strategies, including ceasing its operations.  Further, on
March 17, 2008, the company was required to layoff 58 of its 84
employees due to a slowdown in its operations.

A full-text copy of the company's annual 2007 report is available
for free at http://ResearchArchives.com/t/s?2b73

                    About Challenger Powerboats

Washington, Missouri-based Challenger Powerboats Inc. (OTC: CPBI)
-- http://www.challengerpowerboats.com/-- designs and  
manufactures boats, family sport cruisers, jet boats and water ski
tow boats under the brands Challenger Powerboats, Sugar Sand and
Gekko.  The company is a design-to-manufacturing organization,
creating or licensing designs, and creating tooling, molds, and
parts necessary to assemble its products in-house.  The company
markets its products through a dealer network comprising more than
100 dealers throughout the United States, Canada, Mexico, Europe,
Australia, the Middle East and Japan.  On Jan. 1, 2007, the
company acquired International Marine and Recreation, and Gekko
Sports Corporation.


CHALLENGER POWERBOATS: Files Chapter 7 Petition in Missouri
-----------------------------------------------------------
On April 25, 2008, Challenger Powerboats, Inc., and its wholly
owned subsidiaries, IMAR Group, LLC and Marine Holdings, Inc.,
each filed voluntary petitions for relief under Chapter 7 of the
United States Bankruptcy Code in the United States Bankruptcy
Court for the Eastern District of Missouri, case numbers 08-42946-
705, 08-42948-705 and 08-42950-705, respectively.  Judge Albert L.
Rendlen has been assigned to the cases.

E. Rebecca Case was appointed bankruptcy trustee for all three
entities on the Petition Date.

In connection with the filings, the company has ceased all
business activity and operations.  The company believes that its
assets will be insufficient to satisfy the claims of all creditors
and it is unlikely that the company's shareholders will be
eligible to participate in any distributions of the company's
assets as a result of the Bankruptcy.  Upon liquidation, the
company will cease operations and wind up its business.

                     Resignation and Layoffs

On April 24, 2008, Mr. Michael Novielli resigned effective
immediately as a Director of Challenger Powerboats.  Mr.
Novielli's resignation letter did not reference a disagreement
with the company on any matter relating to the company's
operations, policies and practices.

On April 24, 2008, Mr. Douglas Leighton resigned effective
immediately as a Director of the company.  Mr. Leighton's
resignation letter did not reference a disagreement with the
company on any matter relating to the company's operations,
policies and practices.

On April 18, 2008, Challenger Powerboats laid off all but three
employees and one contract laborer at its manufacturing facilities
in Washington, Missouri, which manufactured the company's decks
and hulls for the Challenger and Gekko boats.  In addition to the
layoffs at its Missouri facility, the company also laid off all
but two employees at its manufacturing facilities in Fargo, North
Dakota, which manufactured the company's decks and hulls for the
Sugar Sand boats.  From March 17, 2008 through April 18, 2008, the
company has laid off approximately 79 of its 84 employees due to a
slowdown in the company's operations.

                     About Challenger Powerboats

Washington, Missouri-based Challenger Powerboats Inc. (OTC: CPBI)
-- http://www.challengerpowerboats.com/-- designs and  
manufactures boats, family sport cruisers, jet boats and water ski
tow boats under the brands Challenger Powerboats, Sugar Sand and
Gekko.  The company is a design-to-manufacturing organization,
creating or licensing designs, and creating tooling, molds, and
parts necessary to assemble its products in-house.  The company
markets its products through a dealer network comprising more than
100 dealers throughout the United States, Canada, Mexico, Europe,
Australia, the Middle East and Japan.  On Jan. 1, 2007, the
company acquired International Marine and Recreation, and Gekko
Sports Corporation.


CHASEFLEX: Moody's Junks Ratings on Four Loan Classes
-----------------------------------------------------
Moody's Investors Service has downgraded the ratings of 24
tranches from 3 Alt-A transactions issued by ChaseFlex.  Twelve
tranches remain on review for possible further downgrade.  
Additionally, 2 tranches were placed on review for possible
downgrade, and the rating on one tranche was confirmed.

The collateral backing these transactions consists primarily of
first-lien, fixed and adjustable-rate, Alt-A mortgage loans.  The
ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels.  The
actions are a result of Moody's on-going review process.

Complete rating actions are:

Issuer: ChaseFlex Trust Series 2007-2

  -- Cl. M-5, Downgraded to A3 from A2
  -- Cl. M-6, Downgraded to Baa2 from A3
  -- Cl. B-1, Downgraded to Ba3 from Baa1
  -- Cl. B-2, Downgraded to B1 from Baa2; Placed Under Review for
     further Possible Downgrade

  -- Cl. B-3, Downgraded to B2 from Baa3; Placed Under Review for
     further Possible Downgrade

Issuer: ChaseFlex Trust Series 2007-3

  -- Cl. II-A-2, Placed on Review for Possible Downgrade,
     currently Aaa

  -- Cl. II-M1, Downgraded to A2 from Aa1
  -- Cl. II-M2, Downgraded to Baa2 from Aa2
  -- Cl. II-M3, Downgraded to Ba3 from Aa3
  -- Cl. II-M4, Downgraded to B1 from A2; Placed Under Review for
     further Possible Downgrade

  -- Cl. II-M5, Downgraded to B1 from A3; Placed Under Review for
     further Possible Downgrade

  -- Cl. II-M6, Downgraded to B2 from Baa1; Placed Under Review
     for further Possible Downgrade

  -- Cl. II-B1, Downgraded to B2 from Baa3; Placed Under Review
     for further Possible Downgrade

  -- Cl. II-B2, Downgraded to Ca from Ba1

Issuer: ChaseFlex Trust Series 2007-M1

  -- Cl. 1-A4, Placed on Review for Possible Downgrade, currently
     Aaa

  -- Cl. 1-M1, Downgraded to B1 from Aa1; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-M2, Downgraded to B2 from Aa2; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-M3, Downgraded to B3 from Aa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-M4, Downgraded to B3 from A1; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-M5, Downgraded to B3 from Baa1; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-M6, Downgraded to B3 from Baa2; Placed Under Review for
     further Possible Downgrade

  -- Cl. 1-B1, Downgraded to Ca from Ba1
  -- Cl. 1-B2, Downgraded to Ca from Ba2
  -- Cl. 2-M3, Confirmed at Aa3
  -- Cl. 2-M6, Downgraded to Ba1 from Baa3
  -- Cl. 2-B1, Downgraded to B1 from Ba2
  -- Cl. 2-B2, Downgraded to Ca from Ba3


CLAIRE'S STORES: Poor Performance Cues S&P to Junk Note Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Pembroke Pines, Florida-based Claire's Stores Inc. to
'B-' from 'B'.  At the same time, S&P lowered the ratings on the
company's $1.65 billion senior secured credit facilities to 'B'
from 'B+', its $600 million senior unsecured notes to 'CCC+' from
'B-', and its $335 million senior subordinated notes to 'CCC' from
'CCC+'.  The outlook is negative.
     
"The downgrade reflects the poor performance over the past year,
which was well below our expectations," said Standard & Poor's
credit analyst David Kuntz.  Claire's credit protection profile
weakened modestly concurrently with the deterioration of
operations.


CHECKSMART FIN'L: Bill 545 Cues S&P to Put Rtngs. Under Neg. Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B' long-term
counterparty credit rating on CheckSmart Financial Co. on
CreditWatch with negative implications.  The 'BB-' rating on
CheckSmart's first-lien bank facility and the 'CCC+' rating on its
second-lien bank facility are also on CreditWatch Negative.
     
The CreditWatch listing follows the Ohio House of Representatives'
passage of Bill 545 on April 30, 2008.  In S&P's view, if this
bill is passed by the State Senate and signed by the governor, it
would severely restrict payday lending in Ohio.  CheckSmart
generates approximately 80% of its revenues from payday lending,
and more than 50% of outstanding payday loans were to Ohio
consumers at year-end 2007.  "The CreditWatch listing reflects our
view that that House Bill 545, if enacted into law, would render
CheckSmart's almost 100 Ohio stores unprofitable, possibly
necessitating their closure," said Standard & Poor's credit
analyst Rian M. Pressman, CFA. (As of year-end 2007, CheckSmart
had approximately 256 stores in 11 states.)  As a consequence,
CheckSmart's ability to service its bank facilities may be
severely constrained.
     
Ohio House Bill 545 would cap the allowable rate of interest on
payday loans at 28% (quoted on an APR equivalent basis).  This
translates to less than $2.50 per $100 borrowed, significantly
below the $12-$14 that S&P believe industry participants would
have to charge to break even.  In Ohio, payday lenders currently
charge $15 per $100 borrowed.  In addition, a consumer could not
borrow more than $500, or 25% of the his monthly income; loan
terms would be extended to 31 days from the customary two weeks;
and consumers would be limited to four payday loans per year.
     
If Ohio House Bill 545 or a similar bill passes the Ohio Senate
and is signed by the governor, the ratings on CheckSmart and its
bank facilities may be lowered by one notch or more.  If this
legislation does not become law and the economics of payday
lending in Ohio remain essentially unchanged, the outlook will be
changed back to stable.


COBLESKILL BUSINESS: Case Summary & 12 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Cobleskill Business Park, LLC
        Mineral Springs Road
        Cobleskill, NY 12043

Bankruptcy Case No.: 08-11304

Type of Business: The Debtor owns and manages industrial real
                  estate.

Chapter 11 Petition Date: April 28, 2008

Court: Northern District of New York (Albany)

Judge: Robert E. Littlefield Jr.

Debtor's Counsel: Richard L. Weisz, Esq.
                  Hodgson Russ LLP
                  677 Broadway
                  Albany, NY 12207
                  Tel: (518) 465-2333
                  Email: Rweisz@hodgsonruss.com
                  http://www.hodgsonruss.com/

Total Assets: $5,950,209

Total Debts:  $1,978,823

Debtor's 12 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Marion Jones                   $84,000
P.O. Box 1524
Destin, FL 32540
Tel: (978) 697-6028

United Rentals                 $35,258
1401 Vischer Ferry Road
Clifton Park, NY 12065
Tel: (518) 459-6174

BTS Staffing                   $33,294
49 S. Main St.
Gloversville, NY 12078
Tel: (518) 725-7884

Waste Management of Eastern    $32,391
NY

National Grid                  $30,990

NYSEG                          $17,515

Sunbelt Rentals                $13,132

Guernsey's Nurseries           $9,681

Blue Cross Blue Shield of MA   $8,754

Robert H. Finke & Sons, Inc.   $8,010

Home Depot Credit Services     $5,958

Law Offices of James           $1,210
Stedronsky


COLUMBIA RIVER: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Columbia River Fish Farms, LLC
        P.O. Box 262
        Coulee Dam, WA 99116

Bankruptcy Case No.: 08-01669

Chapter 11 Petition Date: April 28, 2008

Court: Eastern District of Washington (Spokane/Yakima)

Judge: Frank L. Kurtz

Debtor's Counsel: Kevin O'Rourke, Esq.
                  Email: korourke@southwellorourke.com
                  Southwell & O'Rourke
                  421 W. Riverside Ave., Ste. 960
                  Spokane, WA 99201
                  Tel: (509) 624-0159
                  Fax: (509) 624-9231
                  http://www.southwellorourke.com/

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Fortune Bay Aquaculture        $905,149
Conne River, NL AOH 1JO

Land America Transnation       $143,636
P.O. Box 2118
Omak, WA 98841

Trout Lodge, Inc.              $98,228
P.O. Box 1290
Summer, WA 98390

Northern Fish Products, Inc.   $49,396

C.O. Shull                     $29,979

Norcan Electrical Systems,     $25,980
Inc.

Glen Whitton Trucking          $17,600

LeMaster & Daniels, PLLC       $12,096

RPM Transport                  $12,000

Coulee House Inn & Suites      $11,662

Commodity Forwarders, Inc.     $9,317

ABD Insurance Services         $9,300

Landau Associates              $7,958

Brown Line, LLC                $7,882

Don Kruse Electric, Inc.       $7,652

Net Systems                    $7,503

K&D Freight                    $6,300

Unicel (Rural Cell)            $4,004

Baker Commodities              $4,000

North Cascades National Bank   $3,715


COUNTRYWIDE FINANCIAL: BofA Undecided on How to Treat $38MM Debt
----------------------------------------------------------------
In a form S-4 filed with the U.S. Securities and Exchange
Commission on April 30, 2008, Bank of America N.A. said that it
has not made any decision with regards to guaranteeing or assuming
$38 million of Countrywide Financial Corp.'s outstanding debt.

The bank related in its filing that, as of Dec. 31, 2007,
Countrywide had outstanding indebtedness of approximately $97.23
billion.  This amount includes revolving credit facilities with an
aggregate principal balance of approximately $11.48 billion, which
Bank of America expects will be repaid upon closing of the merger.

The amount also includes Federal Home Loan Bank advances to
Countrywide Bank FSB of approximately $47.68 billion, which Bank
of America expects will remain outstanding until repaid by
Countrywide Bank.

As part of its integration planning in connection with its merger
with Countrywide, Bank of America is currently evaluating
alternatives for the disposition of the remaining Countrywide
indebtedness, including the possibility of redeeming, assuming or
guaranteeing some or all of this debt, or allowing it to remain
outstanding as obligations of Countrywide.  The bank made clear in
its filing that it has made no determination in this regard, and
there is no assurance that any of such debt would be redeemed,
assumed or guaranteed.

The portion of Countrywide's debt that does not comprise debt
under its revolving credit facilities or FHLB advances would
represent approximately 2.4% of Bank of America's total
liabilities as of Dec. 31, 2007, disclosed the bank.

Bloomberg News relates that, since the announcement of the bank's
indecision, financial instruments that are used as investor
insurance in case Countrywide defaults on its loan have been
trading at higher prices.  This suggests that investors are
fretting about a possible default, Bloomberg notes.

                      About Bank of America

Based in Charlotte, North Carolina, Bank of America Corp.
(NYSE:BAC) -- http://www.bankofamerica.com-- is a bank holding   
company.  Bank of America provides banking and non-banking
financial services and products through three business segments:
global consumer and small business banking, global corporate and
investment banking, and global wealth and investment management.   
In December 2006, the company sold its retail and commercial
business in Hong Kong and Macau to China Construction Bank.  In
October 2006, BentleyForbes, a commercial real estate investment
and operations company, acquired Bank of America plaza in Atlanta
from CSC Associates, a partnership of Cousins Properties
Incorporated and the company.  In June 2007, the company acquired
the reverse mortgage business of Seattle Mortgage Company, an
indirect subsidiary of Seattle Financial Group Inc.  In October
2007, ABN AMRO Holding N.V. completed the sale of its United
States subsidiary, LaSalle Bank Corporation, to Bank of America.

                   About Countrywide Financial

Based in Calabasas, California, Countrywide Financial Corporation
(NYSE: CFC) -- http://www.countrywide.com/-- is a
diversified            
financial services provider and a member of the S&P 500, Forbes
2000 and Fortune 500.  Through its family of companies,
Countrywide originates, purchases, securitizes, sells, and
services residential and commercial loans; provides loan closing
services such as credit reports, appraisals and flood
determinations; offers banking services which include depository
and home loan products; conducts fixed income securities
underwriting and trading activities; provides property, life and
casualty insurance; and manages a captive mortgage reinsurance
company.

                          *     *     *

As reported in the Troubled Company Reporter on Jan. 15, 2008,
Moody's placed the ratings of Countrywide Financial Corporation
and its subsidiaries under review for upgrade.  CFC and
Countrywide Home Loans senior debt is rated Baa3 and short-term
debt is rated Prime-3.  Countrywide Bank FSB's bank financial
strength rating is C-, deposits are rated Baa1 and short-term debt
Prime-2.  All long and short-term ratings are placed under review
for possible upgrade.


COUNTRYWIDE MORTGAGE: Fitch Lowers Ratings on Five Cert. Classes
----------------------------------------------------------------
Fitch Ratings has taken rating actions on Countrywide mortgage
pass-through certificates.  Unless stated otherwise, any bonds
that were previously placed on Rating Watch Negative are removed.   
Affirmations total $182.1 million and downgrades total
$23.2 million.

CWABS 2003-SD2
  -- $4.6 million class A-1 affirmed at 'AAA';
  -- $2.0 million class A-2 affirmed at 'AAA';
  -- $11.3 million class M-1 affirmed at 'AA';
  -- $2.6 million class M-2 downgraded to 'BBB' from 'A';
  -- $2.5 million class B-1 downgraded to 'B' from 'BBB'.

CWABS 2004-SD3
  -- $32.2 million class A-1 affirmed at 'AAA';
  -- $8.1 million class A-2 affirmed at 'AAA';
  -- $15.0 million class M-1 affirmed at 'AA';
  -- $7.3 million class M-2 affirmed at 'A';
  -- $6.8 million class M-3 affirmed at 'BBB';
  -- $0.7 million class B-1 affirmed at 'BBB-'.

CWABS 2004-SD4
  -- $13.9 million class A-1 affirmed at 'AAA';
  -- $3.5 million class A-2 affirmed at 'AAA';
  -- $17.7 million class M-1 affirmed at 'AA';
  -- $10.1 million class M-2 downgraded to 'A-' from 'A';
  -- $6.5 million class M-3 downgraded to 'BB+' from 'BBB';
  -- $1.5 million class B-1 downgraded to 'B' from 'BBB-'.

CWABS 2005-SD1
  -- $21.0 million class A-1-C affirmed at 'AAA';
  -- $2.3 million class A-2 affirmed at 'AAA';
  -- $17.8 million class M-1 affirmed at 'AA';
  -- $9.5 million class M-2 affirmed at 'A';
  -- $6.9 million class M-3 affirmed at 'BBB';
  -- $1.4 million class B-1 affirmed at 'BBB-'.


COUNTRYWIDE FIN'L: BOA's S-4/A Filing Cues S&P to Cut Rating
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Countrywide Financial Corp. and Countrywide Home Loans Inc. to
'BB+/B' from 'BBB+/A-2'.  S&P also lowered its rating on
Countrywide Bank fsb to 'BBB/A-2' from 'A-/A-2'.
     
The rating actions were due to the disclosure in Bank of America
Corp.'s May 1 Form S-4/A filing relating to the terms of the
merger between BAC and Countrywide and a new reference regarding
the treatment of Countrywide's indebtedness.  All of S&P's  
ratings on Countrywide are now on CreditWatch Developing, a
revision from CreditWatch Positive (where they were placed
Jan. 11, 2008) due to the new level of uncertainty as to the
ultimate legal status of Countrywide's creditors after the merger.  
As recently as April 30, 2008, S&P issued a CreditWatch update on
Countrywide indicating that its sensing a change in the status of
this merger agreement would result its downgrading Countrywide
several notches.
     
Specifically, S&P's rating actions follow BAC's May 1 filing of a
Form S-4/A that states that "As part of its integration planning
in connection with the merger, Bank of America is currently
evaluating alternatives for the disposition of the remaining
Countrywide indebtedness, including the possibility of redeeming,
assuming, or guaranteeing some or all of this debt, or allowing it
to remain outstanding as obligations of Countrywide (and not
Bank of America).  Bank of America has made no determination in
this regard, and there is no assurance that any of such debt would
be redeemed, assumed, or guaranteed."

The filing indicates that it is now possible that BAC would not
support some of Countrywide's debt, including the approximately
$17 billion of medium-term notes, $4 billion of convertible debt,
$2.2 billion junior subordinated debt, and $1 billion of
subordinated debt currently outstanding.  There is also language
in the filing indicating that Countrywide will be merged with and
into a merger subsidiary that will remain wholly owned by BAC, and
assurances from BAC to Countrywide's common shareholders that they
will receive common dividends.  Until this filing, it was S&P's   
understanding that BAC would acquire all of Countrywide as stated
in the January 2008 merger agreement.  This new filing raises the
possibility that this assumption is no longer true.
      
"The CreditWatch Developing indicates that after the merger, the
ratings on Countrywide could either be raised, lowered, or
affirmed depending on the ultimate legal status of and support for
Countrywide creditors and final clarification by BAC regarding the
merger terms.  If Countrywide is to be a wholly owned, core
subsidiary of BAC after the acquisition, then we expect to
equalize our ratings on Countrywide with those on BAC. If
selective debt of Countrywide is not fully supported under the
merger terms or its legal status as a wholly owned subsidiary post
acquisition is not considered to be core under our criteria, then
ratings could either be affirmed or lowered," said Standard &
Poor's credit analyst Victoria Wagner.


DALTON CDO: Poor Collateral Prompts Fitch to Chip Ratings
---------------------------------------------------------
Fitch has downgraded eight classes of notes issued by Dalton CDO,
Ltd.  These rating actions are effective immediately:

  -- $114,000,000 class A-1a1 (undrawn TRS) notes downgraded to
     'BBB' from 'AAA' and remain on Rating Watch Negative;

  -- $50,000,000 class A-1a2 notes downgraded to 'BBB-' from 'AAA'
     and remain on Rating Watch Negative;

  -- $36,000,000 class A-1b1 notes downgraded to 'BB' from 'AAA'
     and remain on Rating Watch Negative;

  -- $40,000,000 class A-1b2 notes downgraded to 'BB-' from 'AAA'
     and remain on Rating Watch Negative;

  -- $40,000,000 class A-2 notes downgraded to 'B' from 'AAA', and
     remain on Rating Watch Negative;

  -- $57,400,000 class B notes downgraded to 'CCC' from 'AA', and
     removed from Rating Watch Negative;

  -- $20,077,202 class C notes downgraded to 'C' from 'A', and
     removed from Rating Watch Negative;

  -- $18,387,714 class D notes downgraded to 'C' from 'BBB', and
     removed from Rating Watch Negative;

Dalton is a hybrid structured finance collateralized debt
obligation that combines the use of synthetic and cash assets, as
well as unfunded and funded liabilities.  Dalton's portfolio
originally included long and short positions.  Dalton closed on
June 28, 2007 and is managed by Dynamic Credit Partners, LLC.  
Dalton has a $114 million unfunded senior swap (class A-1a1 swap)
and has issued approximately $286 million of funded notes and
funded preferred securities.  Dalton's reinvestment period will
end in July 2011.

Dalton has a portfolio comprised primarily of subprime residential
mortgage-backed securities bonds (19%), structured finance CDOs
(65%) and other structured finance assets.  Subprime RMBS bonds of
the 2005, 2006, and 2007 vintages account for approximately 8%,
7%, and 4% of the portfolio, respectively.  Likewise, the SF CDO
exposure includes SF CDO originated in 2005 (19%), 2006 (27%) and
2007 (4%) and 15% originated before 2005.

The short positions, with an initial notional balance of
$130 million, were entered at close and consisted of primarily
'AA' rated tranches of 2006 high grade and mezzanine SF CDO bonds.  
Since going effective Dalton has unwound all their short
positions.  Proceeds from the unwound short positions have been
used to purchase CRE CDOs, CLOs and RMBS from earlier vintages and
of higher credit quality relative to the existing portfolio
collateral, as well as vintage CMBS and CBOS.  As of the most
recent trustee report dated, April 15, 2008, the long collateral
balance is approximately $501 million as opposed to a liability
balance of approximately $402 million.  The ability to monetize
the short positions has been of benefit to the notes as additional
credit enhancement, especially to the most senior notes by
providing more credit enhancement against losses.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
and SF CDOs with underlying exposure to subprime RMBS.  Since
close, approximately 78% of the portfolio has been downgraded,
with 36% of the portfolio currently on Rating Watch Negative.  As
of the most recent trustee report dated April 15, 2008, the
weighted average rating factor is 20.71('BB-/B+') versus a trigger
of 5.21('BBB/BBB-').  All principal coverage tests are failing
with the class A/B principal coverage at approximately 89.3%
versus a trigger or 108.55%.  Currently approximately 37% of the
portfolio is classified as defaulted or PIKing.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A RMBS.  Additionally, Fitch is reviewing its
SF CDO approach and will comment separately on any changes and
potential rating impact at a later date.  Classes rated CCC and
below will not have a rating watch assessment as such a rating
reflects Fitch's view on the credit worthiness going forward.

The ratings of the class A and B notes address the likelihood that
investors will receive full and timely payments of interest, as
per the transaction's governing documents, as well as the stated
balance of principal by the legal final maturity date.  The
ratings of the class C and D notes address the likelihood that
investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


DANKA BUSINESS: To Undergo Voluntary Liquidation After Sale
-----------------------------------------------------------
Danka Business Systems PLC disclosed in a regulatory filing that
the company will undergo a voluntary liquidation under the laws
of the United Kingdom.

As reported in the Troubled Company Reporter on April, 10, 2008,
the company signed a definitive agreement with Konica Minolta
Business Solutions U.S.A., Inc., enabling Konica Minolta to
acquire the company's wholly owned U.S. subsidiary, Danka Office
Imaging Company, at a transaction valued at $240 million.  Danka
Office is the company's remaining operating business.

The company's board of directors said that liquidation is the
"most cost effective manner" to distribute the net cash obtained
from the sale to shareholders.

The company plans to distribute around $6.5 million to ordinary  
shareholders.

The company will hold an extraordinary general meeting wherein
shareholders will be asked to vote on:

     (i) the sale of the company's U.S. operations on the terms
         of and subject to the conditions of the stock purchase
         agreement, dated as of April 8, 2008, by and among
         Danka Business Systems PLC, Danka Holding Company, and
         Konica Minolta, pursuant to which the Danka Holding
         will sell DOIC to Konica Minolta in a sale of all the
         outstanding capital stock of DOIC;

    (ii) entry into a "members voluntary liquidation," pursuant
         to which the company will be voluntarily wound up;

   (iii) the approval of a $5 million termination fee to be
         paid to Konica Minolta in the event the stock purchase
         agreement is terminated under certain circumstances;
         and

    (iv) other resolutions necessary to effect both the sale of
         the U.S. operations and the Liquidation, including a
         resolution authorizing the directors of the company to
         take any and all actions required to be taken by the
         company or which the directors of the company (or a
         duly authorized committee thereof) deem necessary or
         desirable to consummate the sale of DOIC to Konica
         Minolta.

                 Distribution Plan for Holders of
             Participating Shares and Ordinary Shares

In a filing with the U.S. Securities and Exchange Commission late
April 2008, the company disclosed that under the terms of its
Articles of Association, the holders of the Participating Shares
are currently entitled to receive the sum of about $372 million
upon liquidation.  The Board believes that the relevant provisions
of the Articles require the entirety of the amount which would
ultimately be available for distribution to be paid to the holders
of the Participating Shares, leaving no amount available for
distribution to the holders of Danka's ordinary shares or ADSs.

In order to ensure that there is some return to the holders of the
Danka's ordinary shares and ADSs in the Liquidation, the Board of
Danka has, pursuant to the Deed of Undertaking, procured the
agreement of the holders of the Participating Shares to direct the
company's liquidators to pay the persons who hold ordinary shares
and ADSs as at the time at which the Liquidation commences, an
aggregate amount in cash equal to approximately $6.5 million.  The
distribution for holders of ordinary shares and ADSs will be taken
out of the proceeds of the Liquidation prior to any distribution
to the holders of Participating Shares, on the basis of a payment
in cash of $0.025 per ordinary share and a payment in cash of
$0.10 per ADS.

Following this payment, additional proceeds of the Liquidation are
to be paid to the holders of Participating Shares in accordance
with the Articles and holders of ordinary shares and ADSs would
not receive further distributions from the proceeds of the
Liquidation.

Danka shareholders should note that the disposal to Konica Minolta
and the Liquidation remain conditional on shareholder approval of
resolutions to be proposed at the extraordinary general meeting of
the company, to be convened in due course.  The obligations of the
Participating Shareholders under the Deed of Undertaking are
conditional on these resolutions being duly approved by the
requisite majorities and completion of the disposal taking place.

Further details of the Deed of Undertaking and the other proposals
to be considered by Danka's shareholders at the EGM will be set
out in the shareholder circular convening the EGM and the proxy
statement, each of which will be posted to Danka shareholders as
soon as possible.

For inquiries:

   Edward Quibell
   Chief Financial Officer, Danka
   Tel: (727) 622-2760

   Weber Shandwick Financial (London)
   James White/Laura Vaughn
   Tel: 020 7067 0700

   Evolution Securities Limited (London)
   (Sponsor to Danka Business Systems PLC)
   Stuart Andrews / Bobbie Hilliam
   Tel: 020 7071 4300

Evolution Securities Limited, which is authorized in the United
Kingdom by the Financial Services Authority, is acting as Sponsor
to Danka Business Systems PLC and no one else in connection with
the transaction will be responsible to anyone other than the
company for providing the protections afforded to customers of
Evolution Securities, or for advising any other person in
connection with the transaction.

                     About Danka Business

Danka Business Systems PLC (LON: DNK) -- http://www.danka.com/   
--  offers document solutions, including office imaging
equipment, software, support, and related services and supplies
in the United States.  It offers office imaging products,
services, supplies and solutions, including digital and color
copiers, digital and color multifunction peripherals printers,
facsimile machines and software.  It also provides a range of
contract services, including professional and consulting
services, maintenance, supplies, leasing arrangements, technical
support and training, collectively referred to as Danka Document
Services.  The company's revenue is generated from two primary
sources: new retail equipment, supplies and related sales, and
service contracts.  Danka sells Canon products, as well as
Kodak, Toshiba and Hewlett-Packard.  On Aug. 31, 2006, the
company sold its subsidiary, Danka Australasia, PTY Limited, to
Onesource Group Limited.  In January 2007, the company disposed
of its European businesses to Ricoh Europe B.V.

The company's Dec. 31, 2007 balance sheet showed total assets of
$233.5 million, total liabilities of $225.0 million, 6.5%
senior convertible participating shares of $362.6 million, and
total stockholders' deficit of $354.1 million.


DAVID MORGAN: Case Summary & 19 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: David Morgan Fine Arts, Inc.
        aka David Morgan Fine Arts International, LLC
        aka David Morgan Fine Arts International, Inc.
        dba The Art Marketplace
        14539-C S. Military Trail
        Delray Beach, FL 33484

Bankruptcy Case No.: 08-15311

Type of Business: The Debtor sells nondurable goods in wholesale.  
                  It also sells the following in retail:
                  miscellaneous merchandise cork craft supplies
                  and accessories, multicultural project materials
                  and accessories, cross curricular projects, clay
                  and modeling compounds and ceramics equipment
                  and accessories.

Chapter 11 Petition Date: April 28, 2008

Court: Southern District of Florida (West Palm Beach)

Judge: Paul G. Hyman, Jr.

Debtor's Counsel: Robert C. Furr, Esq.
                  Furr & Cohen
                  2255 Glades Rd., Ste. 337W
                  Boca Raton, FL 33431
                  Tel: (561) 395-0500
                  Fax: (561) 338-7532
                  Email: bnasralla@furrcohen.com
                  http://www.furrcohen.com/

Total Assets: $1,933,183

Total Debts:  $1,890,547

Debtor's 19 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
RLV Marketplace of Delray LP   rent, Delray          $142,534
Attn: Ramco Gershenson
31500 Northwestern Hwy.
Ste. 300
OH 43884
Tel: (248) 350-9900

Tri County Plaza Assoc.        rent                  $105,361
Attn: Turnberry Associates
Fort Lauderdale, FL 33324
                               Art Marketplace of    $38,787
                               Davie - past due
                               balances for
                               arreaarages
                               incurred prior to
                               November 27, 2007
                               pursuant to agreement

Del Jou Art Group              art                   $109,453
1616 Huber St.
Atlanta, GA 30318-7530
Tel: (404) 350-7195

Sun Sentinel                   advertising           $39,589

Ana Oberlander                 investment in         $30,000

Universal Framing Products     frame moulding        $29,292

Akerman Senterfitt             attorney fees         $28,491

Dennis Trainor                 reimbursement of      $25,000
                               investor funds

Top Art                        art                   $18,891

Ruben Bore & Son Fine Arts     art                   $16,275

Margaret & Albert Welch        investment in         $15,000

JES Publising Corp.            art                   $14,310

GAL Ltd Publishers             art                   $12,490

WTVJ NBC                       advertising           $11,735

Morris Vistor Publications LLC advertising           $11,680

WPTV-Channel 5                 advertising           $11,530

Gallery 25 Ltd                 art                   $10,450

Jack                           art                   $10,170

Ethel Daub                     investment in         $10,000
                               company


DELTA AIR: Posts First Quarter 2008 Net Loss of $6,390,000,000
--------------------------------------------------------------
Delta Air Lines Inc. reported results for the quarter ended
March 31, 2008.  Key points include:

     * On April 14, 2008, Delta announced an agreement to merge
       with Northwest; the transaction will create America's
       premier global airline, which is expected to generate in
       excess of $1,000,000,000 in annual revenue and cost
       synergies;

     * Delta's net loss for the first quarter excluding special
       items was $274,000,000, or $0.69 per diluted share, driven
       by a $585,000,000 year over year increase in the cost of
       fuel;

     * Delta's reported net loss for the March 2008 quarter was
       $6,400,000,000, or $16.15 per diluted share;

     * special items include a $6,100,000,000 non-cash goodwill
       impairment charge from the decline in Delta's market
       capitalization due to sustained record fuel prices;

     * as of March 31, 2008, Delta had $3,600,000,000 in
       unrestricted liquidity, including $1,000,000 available
       under its revolving credit facility.

                 Response to Record Fuel Prices

On March 18, Delta announced that it had aggressively recalibrated
its 2008 business plan with a focus on preserving liquidity in
light of the significant increase in crude oil prices.  The
airline reevaluated its capacity, targeting reductions in or
cancellations of unprofitable routes, and has already implemented
schedule changes to bring down domestic flying.  Delta now expects
system capacity for the second half of 2008 to be down 0-2%
compared to 2007, with domestic capacity down 9-11%.

As a result of the capacity reduction, the company is removing 15-
20 mainline and 60-70 regional jet aircraft from its operations by
the end of 2008.  Delta is continuing to evaluate the fuel and
demand environment and will make proactive changes quickly if
economic conditions warrant.

Delta is also accelerating revenue and productivity initiatives to
help address high fuel costs, as well as reducing capital
spending. These measures will provide revenue and cost benefits of
$150,000,000in 2008, equivalent to $350,000,000 on an annual
basis, in addition to the $400,000,000 in productivity initiatives
previously announced.

                    Financial Performance

Delta reported a net loss of $274,000,000 in the first quarter of
2008 compared to a net loss of $6,000,000 in the first quarter of
2007, excluding special and reorganization items.  The
$268,000,000 year over year increase in net loss was driven by a
$585,000,000 increase in costs due to higher fuel price.  Delta
did not record an income tax benefit in the March 2008 quarter.

                       Revenue Momentum

Passenger revenue increased 10% in the first quarter of 2008 on a
2% increase in capacity compared to the prior year period,
demonstrating Delta's momentum from its network transformation
and revenue management initiatives.  The increase in passenger
revenue was driven by 6% higher yield and 4% higher traffic.  
Delta's international expansion has contributed significantly to
passenger revenue growth, as the airline has launched nearly 90
new international routes since the summer of 2005, including Tel
Aviv, Prague, Dubai, London-Heathrow and Shanghai.  Delta has
grown the percentage of its capacity operating in international
markets from 25% in the March 2006 quarter to 33% in the March
2008 quarter.  Delta expects more than 40% of capacity to be
deployed in international markets by summer 2008.

Based on the most recently available ATA data, Delta's
consolidated length of haul adjusted passenger unit revenue
(PRASM) was 101% of industry average PRASM, excluding Delta, up
from 86% in 2005 when the company began its network
restructuring.  This represents the first quarter in eight years
that Delta has exceeded industry average.

Delta's selection of unique and distinct markets has allowed the
company to grow international unit revenues and capacity at double
digit rates.  Delta's international PRASM grew 13% year over year
in the March 2008 quarter, with strong yield gains in the trans-
Atlantic and Latin markets.  Domestic PRASM increased 6% on a
capacity decline of 2%.  Consolidated system PRASM improved more
than 7% to 11.36 cents.

Non-passenger revenue was also strong in the first quarter.  
Revenue from Cargo operations increased 20% compared to the March
2007 quarter. Other net revenues grew $133 million, or 33%,
primarily due to an increase in passenger fees and charges,
revenue from SkyMiles, and maintenance services provided to third
parties.

                         Cost Discipline

Excluding special items described below, Delta's operating
expenses increased 20%, or $825,000,000 compared to the first
quarter of 2007, largely due to the $585,000,000 increase in
costs due to higher fuel prices.  The remainder of the increase
in operating expense was due primarily to fresh start accounting,
salary and benefit enhancements for Delta's employees, and the
cost of increased capacity versus the prior year quarter.  For
the March 2008 quarter, non-operating expenses declined 20%, or
$32,000,000, due primarily to lower effective interest rates
(including the impact of fresh start reporting) and interest
earned on higher average cash balances, which were partially
offset by FAS 133 mark-to-market on hedges.

Delta's mainline unit cost (CASM5) increased 16% to 11.64 cents
compared to the prior year period, reflecting the significant
increase in fuel costs. Excluding fuel expense, mainline CASM
increased 4% to 7.31 cents compared to the March quarter of 2007.

"We have moved quickly to mitigate the short-term impact of higher
fuel prices by further reducing domestic capacity and taking a
disciplined approach to costs and cash flow.  These actions have
offset more than 50% of the fuel price impact," said Edward
Bastian, Delta's president and chief financial officer.

"However, we clearly need to do more. Merging with Northwest will
generate over $1,000,000,000 in annual synergies, providing a more
durable financial foundation for the future and giving Delta a
stronger platform for profitable, long-term growth," he said.

                 Special and Reorganization Items

Delta recorded special items of $6,100,000,000 in the March 2008
quarter, including (i) a $6,100,000,000 non-cash goodwill
impairment charge due to a decline in Delta's market
capitalization caused by sustained record fuel prices, and (ii) a
$16,000,000 charge for severance for the previously announced
voluntary workforce reduction programs.

Upon emergence from bankruptcy, Delta recorded a $12,000,000,000
goodwill balance under fresh start accounting.  The valuation of
goodwill was predicated on the company's market value at that
point of $9,400,000,000 billion.  A key assumption in that
valuation was the price of fuel of $70 per barrel.  Crude
oil recently traded over $117 per barrel, with refining spreads
in the $20-$30 range, significantly impacting Delta's single
largest operating expense and future projected discounted cash
flows.

Based on the difference between Delta's book equity and an updated
stand-alone valuation reflecting current fuel and economic
assumptions, prepared in connection with Delta's recently
announced merger with Northwest, Delta recorded a non-cash
goodwill impairment charge of $6,100,000,000.

In the March 2007 quarter, Delta recorded reorganization expenses
totaling $124,000,000.

                        Liquidity Position

During the quarter, Delta issued $733,000,000 in debt, a portion
of which was used to refinance Delta's 2003-1 EETC maturity.  
Delta had approximately $550,000,000 in net capital expenditures
during the March 2008 quarter, with approximately $500,000,000 for
investments in aircraft, parts and modifications to improve
Delta's international product and position the airline for
continued international growth.

At the end of the March 2008 quarter, Delta had $2,800,000,000 in
cash, cash equivalents and short-term investments, of which
$2,600,000,000 was unrestricted.  Delta has an additional
$1,000,000,000 available under its revolving credit facility,
resulting in a total of $3,600,000,000 in unrestricted liquidity
at quarter end.  As of March 31, 2008, Delta had $103,000,000 in
auction-rate securities classified as short-term investments on
its balance sheet.

The company's March 31, 2008 balance sheet showed total assets of
$26,755,000,000, total liabilities of $22,804,000,000, and total
stockholders' equity of $3,951,000,000.

                  March 2008 Quarter Highlights

During the first quarter, Delta continued its international
expansion and made targeted investments in its products,
services, and employees to deliver an industry-leading customer
experience. Highlights include, Delta:

     -- made strong improvements to its operational performance
        reducing involuntary denied boardings by nearly 50%,
        improving baggage performance by 3.6%, and ranking first
        among the network carriers in on-time performance,
        including a first place ranking in on-time performance at
        its hubs in Atlanta, New York-JFK, and Cincinnati for the
        month of February;

     -- launched the joint venture with Air France, including
        three new trans-Atlantic routes connecting London-
        Heathrow to Los Angeles, Atlanta and New York-JFK,
        filling a key position in Delta's portfolio by connecting
        our international gateways in Atlanta and New York to one
        of the world's premier business airports;

     -- continued its commitment to Delta employees -- awarded
        $158,000,000 in profit sharing in recognition of 2007
        financial results, instituted benefits enhancements on
        January 1, contributed $25,000,000 to employee pensions,
        and paid $6,000,000 in Shared Rewards for achieving
        operational goals;

     -- enhanced Atlanta's position as a powerful Asian gateway
        by beginning the first-ever nonstop flight between
        Atlanta and Shanghai, complementing existing service to
        Tokyo and Seoul;

     -- celebrated being the first U.S. carrier to add the
        world's longest range commercial jetliner to its fleet by
        taking delivery of two of the eight Boeing 777-200LR
        aircraft expected to be delivered through 2009.  With the
        new aircraft, Delta strengthens its ability to connect
        customers and cargo between virtually any two cities
        around the globe, nonstop;

     -- ranked as the top U.S. carrier to Latin America by
        readers of Latin Trade magazine and second overall on the
        magazine's "best of" list.  Latin Trade readers also gave
        Delta the highest ranking in ticketing and boarding
        experience, and second highest ranking in frequent flier
        program among traditional network carriers in the U.S.
        and Latin America;

     -- provided SkyMiles members with more ways to redeem their
        miles by initiating a "Pay with Miles" program in
        partnership with American Express, expanding access to
        Medallion(R) Marketplace, growing the SkyMiles online
        auction program, and enhancing the Award Travel search
        calendar on delta.com; and

     -- enhanced customers' onboard experience by expanding the
        popular food for sale program, EATS, beginning April 1 to
        all flights within the U.S. of 750 miles or more and
        select flights between the U. S. and destinations in the
        Caribbean and Latin America.

Delta's first quarter results on Form 10-Q may be accessed at no
charge at: http://ResearchArchives.com/t/s?2b7a

                          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, Issue No. 96; 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: Merger with Northwest Will Result in 1,000 Cut Jobs
--------------------------------------------------------------
In a testimony before Congress, Delta Air Lines, Inc. Chief
Executive Officer Richard Anderson disclosed that a merger with
Northwest Airlines, Inc., will mean the loss of a "guess-timate"
of 1,000 additional jobs, the Atlanta-Journal Constitution
reports.

According to Mr. Anderson, the job losses would come after the
deal closes, and would be concentrated on "the management jobs,
not the front-line jobs" that would involve "finance, accounting
-- the functions that are important in the headquarters."  The
layoff is part of an effort to save on costs to offset
skyrocketing fuel prices, Mr. Anderson told the Committees in the
House and the Senate.

Mr. Anderson will be chief executive officer of the merged
airline.  Delta and Northwest have recently launched their
campaign in Washington, D.C., by testifying before Senate and
Congress hearings.  

Majority of the lawmakers "appeared friendly" of the proposed
consolidation, finding, among other things, that there is "very
little overlap" in the carriers' routes, and agreeing that "fuel
costs really are a game-changer."

Prior to the hearings, Mr. Anderson told The Associated Press
that regardless of the merger, Delta and Northwest will continue
to adjust capacity to demand as fuel prices continue at current
levels.  "That's the rational thing to do, and we'll continue to
do that," he maintained.

After the hearing, Delta spokeswoman Chris Kelly told AJC that
because the consolidated company would be based in Atlanta, more
of the job cuts may be from Northwest because they may not want
to make the move to Georgia.

In the coming months, the two airlines will face additional
hearings.  Regulators and shareholders will reveal whether they
approve the combination, the AP says.

           NWA's CEO Stands to Get $22.1MM After Merger

Northwest CEO Doug Steenland, according to Business Week of
Minnesota, will get about $22.1 million when he resigns after the
Delta merger.  Business Week adds that in 2007, Mr. Steenland
pooled $27 million, including $6 million in stock options
following Northwest's bankruptcy exit.  The report comments that
the stock option is "currently worthless" since the exercise price
of $22 per share is twice the company's current share price.

Minnesota's Star Tribune reports that Northwest intends to retain
Mr. Steenland after the merger and wooes the executive with $3.6
million in stock options.  Based on Star Tribune, Mr. Steenland
waived his option to resign last June and get $3.2 million in
severance pay.  The executive in turn opted a 375,000 "restricted
retention units" as a stock-based compensation, Star Tribune says.

       Delta Pilots Open to Arbiter, Union Chairman Says

Lee Moak, the head of executive committee of Delta's pilots
union, suggested that he is open to arbitration with Northwest
pilots over how to merge their seniority lists, the AP says.

In a letter addressed to fellow pilots, Mr. Moak said that union
leaders believe that seniority integration should be accomplished
after negotiation of a single joint contract and, if necessary,
"expedited arbitration [should] be completed before closing of a
corporate transaction."

Mr. Moak related that while Delta and Northwest pilots failed to
reach an overall agreement on pilot seniority integration, the
Delta pilots union determined "an alternative that would provide
for a superior outcome not only for the pre-merger Delta pilots,
but eventually for all pilots of the merged corporation."

As a result, a tentative agreement between Delta management and
the Delta pilots union was formed, which will provide certain
modifications to the current Pilot Working Agreement, that
include, among others, a three and one-half percent equity stake
in the merged Company, annual pay raises, "furlough protection,"
and an increase in 737-700 pay rates, the letter said.

Rank-and-file Delta pilots will soon be asked to vote on the
proposed Agreement.

The Agreement does not cover Northwest pilots, whose union has
stated it supports arbitration.  The statement, however, was said
before Delta's pilots cut a deal with management days before the
merger announcement, says the AP.

Mr. Moak disclosed that Delta's pilots union welcomes the idea of
partnering with the Northwest pilots "to bring about the rapid
completion of a new joint contract and a fair and equitable
integrated seniority list upon the effective date of the . . .
Agreement."

A full-text copy of Mr. Moak's letter is available for free at:

   http://crewroom.alpa.org/dal/DesktopDefault.aspx?tabid=2421

                     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. 91;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on April 17, 2008,
Moody's Investors Service placed the debt ratings of Delta Air
Lines, Inc. ("Delta", corporate family at B2) and Northwest
Airlines Corporation ("Northwest", corporate family rating at B1)
on review for possible downgrade.  The review was prompted by the
announcement that the two airlines have agreed to combine in an
all-stock transaction with a combined enterprise value of
approximately $18 billion.

Fitch Ratings has affirmed the debt ratings of Delta Air Lines,
Inc. following the announcement that Delta has agreed to merge
with Northwest Airlines Corp., subject to approval by the two
airlines' shareholders and the U.S. Department of Justice.  
Delta's ratings were affirmed as: Issuer Default Rating at 'B';
First-lien senior secured credit facilities at 'BB/RR1'; Second-
lien secured credit facility (Term Loan B) at 'B/RR4'.

The issue ratings apply to $2.5 billion of committed credit
facilities.  The Rating Outlook for Delta has been revised to
Negative from Stable.

Standard & Poor's Ratings Services placed its ratings, including
the 'B+' long-term corporate credit rating, on Northwest Airlines
Corp. on CreditWatch with negative implications, following
announcement of a merger agreement with Delta Air Lines Inc.
(B/Watch Pos/--).  The CreditWatch listing affects enhanced
equipment trust certificates with various ratings, excepting those
that are insured by a bond insurer.  S&P's listing of Northwest
ratings on CreditWatch with negative implications and those of
Delta on CreditWatch with positive implications implies that S&P
foresee a corporate credit rating of either 'B' or 'B+' for the
combined entity.

                          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, Issue No. 96; 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: Internal Revenue Service Withdraws $11.8 Bil. Claims
---------------------------------------------------------------
The Internal Revenue Service, on behalf of the United States of
America, notifies the U.S. Bankruptcy Court for the Southern
District of New York that it is withdrawing six proofs of claim,
filed on Aug. 16, 2006, against certain of Delta Air Lines, Inc.'s
affiliates.

The IRS asserted unsecured claims for $792,106,703 each against
Comair Holdings, LLC and Comair Services, Inc.  Claims for
$1,891,444,502 were filed as unsecured each against Song,
LLC DAL Aircraft Trading, Inc., Delta Ventures III, Inc., Delta
Loyalty Management Services, LLC, and  Comair Services, Inc.

In addition, the IRS filed secured claims for $2,883,912 against
each of the Debtor-affiliates.

The IRS did not disclose its reason for the Claim withdrawals.

                          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, Issue No. 96; 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: JPMorgan Chase Holds 15% of Outstanding Common Stock
---------------------------------------------------------------
In a Form 13G filed with the Securities and Exchange Commission,
JPMorgan Chase & Co., disclosed that in its capacity as a parent
holding company, it is deemed to beneficially own an aggregate of
43,838,137 shares of Delta Air Lines, Inc., common stock,
representing 15% of Delta's outstanding stock.

JPMorgan has sole power to vote on 250,932 shares, the sole power
to dispose of 13,838,661 shares, and shared voting and dispositive
power each of 496 shares.

JPMorgan reports that on May 3, 2007, the Pension Benefit
Guaranty Corporation received 49,484,950 shares of the common
stock of Delta Air Lines.  PBGC has assigned investment
discretion and voting authority over this position to J.P. Morgan
Investment Management Inc., a wholly owned subsidiary of JPMorgan
Chase & Co.

"As of Feb. 29[], 2008, the number of shares held by the PBGC
is now 43,567,017 and this filing is being made to reflect that
decrease," the bank disclosed with the SEC.

Roughly 292,217,061 shares of Delta common stock are outstanding
as of Jan. 31, 2008.

                         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, Issue No. 96; 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.


DELUXE ENTERTAINMENT: S&P Holds B Rating; Revises Outlook to Neg.
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Deluxe
Entertainment Services Group Inc. to negative from stable.
      
"The rating action is based on our concerns regarding the
company's narrowing headroom under its progressively tightening
financial covenants," explained Standard & Poor's credit analyst
Tulip Lim.
     
At the same time, S&P affirmed the 'B' corporate credit rating on
the company.

The ratings on Deluxe reflect the risk of widespread adoption of
digital projection; the company's dependence on several large
movie studios; the likelihood of advance payments by Deluxe to
movie studios to secure contracts; and an aggressive financial
policy (evidenced by the company's debt-financed dividend last
year).  Deluxe's leading market share in motion picture film
processing and duplication; good near-term growth prospects in its
creative services and European film laboratory businesses; and its
long-term contracts with movie studios only minimally offset these
factors.


DEUTSCHE BANK: U.S. Affiliate Faces Insolvency Claims
-----------------------------------------------------
Lindsay Jenkins has notified a Florida law firm representing
Deutsche Bank AG that she is preparing to file insolvency papers
against a Deutsche Bank affiliate in the United States.

Ms. Jenkins is a purported creditor of Deutsche Bank's U.S.
affiliate.

In her March letter to Deutsche Bank's attorneys, Akerman
Senterfitt, Ms. Jenkins stated:

"Given the highly publicized failure of Bear Stearns, I am of the
opinion that the Deutsche Bank affiliate that is serving as a
trustee may be insolvent and may be subjected to an involuntary
bankruptcy petition. I am exploring whether such a petition can be
filed in the Southern District of New York.  I will not, however,
take any action until I receive a response to this letter, or
before April 14, 2008."

"We have not heard from Deutsche Bank's attorneys denying that the
U.S. affiliate is insolvent, and they have not denied they filed a
frivolous and malicious lawsuit against me.  Therefore, we are
proceeding to prepare a filing for the U.S. Bankruptcy Court," Ms.
Jenkins stated.

She added, "Under U.S. law, I stand in a creditor's class that may
initiate a voluntary petition for receivership or, in the
alternative, if a federal court is not available a state court
proceeding seeking appointment of a receiver."

Headquartered in Frankfurt am Main, Germany, Deutsche Bank AG
performs banking services in Germany and operates as a financial
institute in Europe and the rest of the world.

As of Dec. 31, 2007, the company employed 78,291 people on a full-
time equivalent basis and operated in 76 countries out of 1,889
facilities worldwide, of which 52% were in Germany.  The company
offers investment, financial and related products and services to
private individuals, corporate entities and institutional clients.


DUKE FUNDING: Fitch Junks Ratings on Six Note Classes
-----------------------------------------------------
Fitch downgraded ten classes of notes issued by Duke Funding High
Grade III Ltd.

These rating actions are effective immediately:

  -- $439,207,761 class A-1A notes downgraded to 'BB' from 'AAA'
     and remain on Rating Watch Negative;

  -- $1,293,855,556 class A-1B1 notes downgraded to 'BB' from
     'AAA' and remain on Rating Watch Negative;

  -- $1,293,855,556 class A-1B2 notes downgraded to 'BB' from
     'AAA' and remain on Rating Watch Negative;

  -- $102,000,000 class A-2 notes downgraded to 'B' from 'AAA' and
     remain on Rating Watch Negative;

  -- $8,000,000 class B-1 notes downgraded to 'CCC' from 'AA+' and
     removed from Rating Watch Negative;

  -- $8,000,000 class B-2 notes downgraded to 'CCC' from 'AA-' and
     removed from Rating Watch Negative;

  -- $44,000,000 class C-1 notes downgraded to 'C' from 'A+' and
     removed from Rating Watch Negative;

  -- $44,000,000 class C-2 notes downgraded to 'C' from 'A-' and
     removed from Rating Watch Negative;

  -- $12,247,320 class D notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative;

  -- $19,151,849 subordinated notes downgraded to 'C' from 'BB+'
     and removed from Rating Watch Negative.

Duke III is a collateralized debt obligation that closed on
Aug. 3, 2005 and is managed by Duke Funding Management, LLC.  Duke
III will exit its reinvestment period in August 2009.  Duke III
has a portfolio comprised primarily of RMBS bonds; approximately
44.4% are subprime RMBS, 49.6% are Alt-A RMBS, and 5.1% are prime
RMBS.  Subprime RMBS bonds of the 2005, 2006, and 2007 vintages
account for approximately 30.5%, 1.6%, and 12% of the portfolio,
respectively.  Alt-A RMBS of the 2005, 2006 and 2007 vintages
represent approximately 46.1% of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime
residential mortgage-backed securities, and Alternative-A mortgage
loans.  Since the last review on May 11, 2007, approximately 26.7%
of the portfolio has been downgraded net of upgrades, with 10.1%
of the portfolio currently on Rating Watch Negative.  
Approximately 16.3% of the portfolio is now rated below investment
grade and, according to the March 28, 2008 trustee report,
$29.9 million, or 1.5%, of the portfolio is considered defaulted.  
The negative credit migration is primarily attributable to credit
deterioration in subprime and Alt-A RMBS bonds from the 2005, 2006
and 2007 vintages.  The weighted average rating factor test has
been failing its covenant of 1.6 ('AA-/A+') since the November
2007 trustee report, and is reported as 5 ('BBB/BBB-') in the
March 28, 2008 trustee report.

The class A/B, C, and D overcollateralization tests are failing at
103.6%, 99.7% and 99.1% respectively.  The class C-1 and C-2 notes
received interest payments on the last quarterly distribution date
in February, but will begin to pay-in-kind starting on the May
2008 quarterly distribution date.  The class D and subordinated
notes did not receive any interest proceeds on the last quarterly
distribution date in February.  It is unlikely that the class C-1,
C-2, D and subordinated notes will receive any additional payments
going forward due to the failing OC tests.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS, as well as growing concerns with
the performance of Alt-A mortgage loans.  The classes rated 'CCC'
and below are removed from Rating Watch as Fitch believes further
negative migration in the portfolio will have a lesser impact on
these classes.  Fitch is reviewing its SF CDO approach and will
comment separately on any changes and potential rating impact at a
later date.

The ratings of the class A-1A, A-1B1, A-2, B-1 and B-2 notes
address the likelihood that investors will receive full and timely
payments of interest, as per the transaction's governing
documents, as well as the stated balance of principal by the legal
final maturity date.  The ratings of the class C-1, C-2 and D
notes address the likelihood that investors will receive ultimate
and compensating interest payments, as per the transaction's
governing documents, as well as the stated balance of principal by
the legal final maturity date.  The rating of the class A-1B2
notes addresses the likelihood that investors will receive only
full and timely payments of interest as per the transaction's
governing documents.  The rating of the subordinated notes
addresses the likelihood that investors will receive only the
ultimate payment of principal by the stated maturity date.  The
balance reflects the remaining rated balance.


DUKE FUNDING: Fitch Cuts 'BB-' Ratings to 'C' on Two Note Classes
-----------------------------------------------------------------
Fitch downgrades five classes of notes issued by Duke Funding X
CDO, Ltd./Corp.

These rating actions are effective immediately:

  -- $72,000,000 class A1 notes downgraded to 'CCC' from 'BBB+',
     and removed from Rating Watch Negative;

  -- $105,000,000 class A2 notes downgraded to 'CC' from 'BBB-',
     and removed from Rating Watch Negative;

  -- $79,221,079 class A3 notes downgraded to 'C' from 'BB+', and
     removed from Rating Watch Negative;

  -- $18,502,444 class B1 notes downgraded to 'C' from 'BB-', and
     removed from Rating Watch Negative;

  -- $19,452,116 class B2 notes downgraded to 'C' from 'BB-', and
     removed from RRating Watch Negative;.

Duke X is a collateralized debt obligation that closed on
April 12, 2006 and is managed by Duke Funding Management, LLC.  
Duke X's reinvestment period will end in April 2010.  Duke X has a
portfolio comprised entirely of RMBS bonds; approximately 80% are
subprime RMBS, 18% Alt-A RMBS, and 2% prime RMBS.  Subprime RMBS
bonds of the 2005, 2006, and 2007 vintages account for
approximately 52%, 10%, and 4% of the portfolio, respectively.  
Alt-A RMBS of the 2005 and 2006 vintages represent approximately
7% each of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime
residential mortgage-backed securities, and Alternative-A RMBS.  
Since the last review in November 2007, approximately 68% of the
portfolio has been downgraded net of upgrades, and 14.3% of the
portfolio is currently on Rating Watch Negative.  Actual credit
deterioration exceeds the level of downgrades that Fitch assumed
in its November 2007 review.  Overall, 63.3% of the assets in the
portfolio now carry a rating below the rating assumed in
November 2007.  According to the March 9, 2008 trustee report, the
weighted average rating factor has increased to 11.9 ('BB+/BB')
from 5.3 ('BBB/BBB-').  Approximately $71 million, or 6%, of the
portfolio is now considered defaulted.

The negative credit migration has caused the class A2
overcollateralization test to fail, diverting interest and
principal proceeds to the reserve account before paying class A3
interest, causing the class A3, B1 and B2 notes to pay-in-kind.  
Fitch projects that the class A3, B1 and B2 notes will not receive
any future interest or principal payments.

The classes rated 'CCC' and below are removed from Rating Watch as
Fitch believes further negative migration in the portfolio will
have a lesser impact on these classes.  Additionally, Fitch is
reviewing its SF CDO approach and will comment separately on any
changes and potential rating impact at a later date.

The ratings of the class A1 and A2 notes address the likelihood
that investors will receive full and timely payments of interest,
as per the transaction's governing documents, as well as the
stated balance of principal by the legal final maturity date.  The
ratings of the class A3, B1 and B2 notes address the likelihood
that investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


ELECTRICAL COMPONENTS: Poor Liquidity Cues S&P to Junk Credit Rtng
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on St. Louis, Missouri-based Electrical Components
International Inc. to 'CCC+' from 'B'.  Standard & Poor's also
downgraded the company's first-lien bank loan to 'B-' from 'B+'
and the company's second-lien bank loan to 'CCC-' from 'CCC+', and
placed all ratings on CreditWatch with negative implications.  The
company had approximately $317 million of debt as of Sept. 30,
2007.
      
"The downgrade and CreditWatch placement reflect a rapid
deterioration in liquidity, as ECI most likely will not be able to
comply with certain financial covenants in the first quarter of
2008 and future periods; this has resulted in the failure of the
company to file its 2007 financial statements in a timely fashion,
which is considered an event of default under the credit
agreement," said Standard & Poor's credit analyst James Siahaan.
     
ECI, a manufacturer of wire harnesses for white goods appliances
and other products, has experienced a significant reduction in
profitability as a result of weak consumer spending along with a
severe drop-off in residential construction.  This has constricted
headroom under its financial covenants, to the point that its
auditors could not issue an unqualified audit opinion.  S&P could
lower the ratings if ECI does not receive necessary relief from
its lenders prior to the 30-day cure end date of May 29, 2008.


EMPIRE LAND: Wants Court Approval of $20 Million Palmdale Loan
--------------------------------------------------------------
Empire Land LLC seeks authority from the United States Bankruptcy
Court for the Central District of California to obtain up to
$20 million in postpetition revolving credit from Palmdale Land
Investors.

The Debtor and Palmdale are parties to a second amended and
restated limited liability company agreement dated May 31, 2008,  
among the parties and Anaverde LLC, which develops residential
community in Palmdale, California.  The Debtor owns 50.1%
membership interest in Anaverde, while the remaining 49.9% member
interest own by Palmdale.

The proceeds of the loan will be used to make additional capital
contributions to Anaverde, and to pay certain fees and expenses.

The DIP facility will incur interest at 25% per annum, compounded
monthly.  If any portion of the principal of the loan is not paid
when due, the principal loan and any overdue interest will bear
interest at 27%.

The DIP agreement contains customary and appropriate events of
default.  It is also subject to a carve-out for payment to
professional advisors to the Debtor's, any statutory committee
appointed in this case and the U.S. Trustee of Court fees.

The Debtor's DIP obligation is secured by its membership interest
in Anaverde LLC, but junior to the first priority perfected
security interest granted to Cadim Note, Inc.

Cadim is presently the lender and real property in interest with
respect to the loan and security agreement dated Aug. 21, 2007,
between Anaverde and CWCapital LLC, as lender.  Under the
agreement, CWCapital agreed provide $125 million in loan, which
will mature on Sept. 30, 2009, to Anaverde.  On Oct. 4, 2007,
CWCapital transfered all of its interest to Cadim.

Cadim Note has stopped funding as Anaverde is out of compliance
due to some mechanics' liens filed against it.  Anaverde owed at
least $92.3 million to Cadim Note.

A hearing is set for May 27, 2008, at 1:30 p.m., at 3420 Twelfth
Street, Courtroom 302, in Riverside, California., to consider
approval of the Debtor's request.

A full-text copy of the Debtor-In-Possession Agreement is
available for free at:

               http://ResearchArchives.com/t/s?2b76

A full-text copy of the Second Amended And Restated Limited
Liability Company Agreement is available for free at:

               http://ResearchArchives.com/t/s?2b77

Headquartered in Ontario, California, Empire Land, LLC, dba Empire
Land Development, LLC -- http://www.epinc.com/-- develops  
communities and other land construction projects located in
California and Arizona.  As of March 31, 2008, the company owned
at least 11,800 lost in 14 separate land projects.

The company and seven of its affiliates filed for Chapter 11
protection on April 25, 2008 (Bankr. C.D. Calif. Lead Case No.08-
14592).

James Stang, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represents the Debtors in their restructuring efforts.  The U.S.
Trustee for Region  16 has not appointed creditors to serve on an
Official Committee of Unsecured Creditors in this cases.

When the Debtors filed for protection against their creditors,
they listed assets and debts between $100 million to $500 million.


ENRON CORP: Releases 14th Post-Confirmation Report
--------------------------------------------------
Enron Creditors Recovery Corp., formerly known as Enron Corp.,
and its affiliated reorganized debtor entities delivered to the
Court their 14th Post-Confirmation Status Report.

A. Distributions

Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, in New York,  
informs the Court that, between January 1 and April 1, 2008, the
Reorganized Debtors made cash distributions of approximately
$1,067,000,000, to holders of Allowed Claims, with a substantial
portion allocated for holders of Allowed General Unsecured and
Guaranty Claims.  The distributions included approximately:

   -- $1,012,000,000 of Cash distributions,

   -- $45,000,000 of PGE Common Stock equivalents, and

   -- $10,000,000 in interest, dividends and gains from the sale
      of Portland General Electric Company Common Stock.

The Reorganized Debtors have distributed an aggregate of
$14,600,000,000 in cash and PGE Common Stock equivalents to
holders of Allowed Claims, including $82,200,000 of interest,
capital gains and dividends.  About $4,769,500,000 in cash and
cash equivalents of PGE Common Stock are held in the Disputed
Claims Reserve, including $329,300,000 of accrued interest,
capital gains and dividends.

B. Claims Resolution Process

In the first quarter of 2008, nine claims have been disallowed,
24 have been ordered allowed, and five were withdrawn.  Of the
25,000 claims filed against the Debtors, 4,309 have been allowed,
2,264 have been allowed as filed, and 100 remain unresolved.  The
remaining filed claims have been expunged, withdrawn,
subordinated, or otherwise resolved.

The remaining unresolved claims have a reserve base of
approximately $9,700,000,000, comprised of:

   -- $88,000,000 for four pending Administrative Claims; and

   -- $9,600,000,000 for 96 pending General Unsecured, Guaranty
      and Convenience Class Claims.

Of the pending General Unsecured, Guaranty and Convenience Class
Claims, $9,200,000,000 relate to 75 Citibank claims in the
MegaClaims Litigation.   The remaining $400,000,000 relate to 21
unresolved unsecured claims, consisting of:

   (a) four claims totaling $340,000,000, in connection with
       unresolved aspects of certain structured financing
       transactions;

   (b) six claims totaling $5,100,000, which claims are expected
       to be resolved in the second quarter of 2008;

   (c) ten Schedule S claims aggregating $24,000,000, which
       claims are pending presentment of ownership certificate;
       and

   (d) one claim of $43,200,000.
   
C. Citigroup Settlement

The Reorganized Debtors entered into a Global Settlement
Agreement, dated April 4, 2008, with Citigroup and several of its
affiliates, Delta Energy Corporation, the Indenture Trustee for
the Yosemnite/CLN Transaction, the CLN Trust Agent, and certain
other entities resolving the MegaClaim Litigation.

The Global Settlement Agreement, among other things, provides
that Citigroup will pay $1,660,000,000, to Enron.  The settlement
also provides for the expungement or subordination of
approximately $249,400,000, in claims, as well as indemnity
claims with a $4,000,000,000 reserve.

Mr. Rosen says the Global Settlement Agreement will result in the
release of an additional $1,700,000,000 of cash held by the
Reorganized Debtors in the DCR.  The Reorganized Debtors will
disburse the amounts to creditors in through special
distribution.

D. Schedule S

The Reorganized Debtors filed an amended list of Schedule S
claims, which listed the types of claims entitled to benefits of
subordinated afforded by their Plan of Reorganization, to reflect
the decision of the U.S. District Court for the Southern District
of New York affirming the Bankruptcy Court's order with respect
to the relative rights of the EFP Claims under the 1987 Indenture
and reversed the Schedule S Order with respect to the relative
rights of the Cherokee and EFP Claims under the TOPRS Indenture.

The Reorganized Debtors said they have distributed the amounts
reserved for distributions previously withheld that related to
Schedule S.

A copy of the Amended Schedule S is available for free at:

               http://researcharchives.com/t/s?2b75

G. Other Activities

Mr. Rosen states that the Reorganized Debtors continue to proceed
toward final wind-up of Enron activities.  In accordance with
Court-approved procedures, approximately 93,000 boxes of
documents have been approved for disposal, with 148,000 boxes
remaining.

There are 199 remaining entities, of which 69 are Debtors, 26 are
non-debtors, and four are DCR trusts.  Tax returns are being
prepared and filed for all remaining entities, and plans are
being made for preparation of final returns upon completion of
operations.

According to Mr. Rosen, after the pending Citibank Settlement
Motion is ordered, 47 other cases remain pending.  The
Reorganized Debtors are disposing of remaining assets, settling
insurance claims, resolving Enron's captive insurance subsidiary,
and auditing and winding up terminated benefit plans.

Moreover, the Reorganized Debtors continue to perform the
necessary accounting, control and reporting work required to
maximize timely distributions to creditors and accounting and
reporting associated with the amount remaining in the DCR,
approximately $4,796,500,000.

                        About Enron Corp.

Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on Dec. 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.  Judge
Gonzalez confirmed the Company's Modified Fifth Amended Plan on
July 15, 2004, and numerous appeals followed.  The Debtors'
confirmed chapter 11 Plan took effect on Nov. 17, 2004.

Albert Togut, Esq., at Togut Segal & Segal LLP, Brian S. Rosen,
Esq., Martin Soslan, Esq., Melanie Gray, Esq., Michael P. Kessler,
Esq., Sylvia Ann Mayer, Esq., at Weil, Gotshal & Manges LLP,
Frederick W.H. Carter, Esq., Michael Schatzow, Esq., Robert L.
Wilkins, Esq., at Venable, Baetjer and Howard, LLP, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft, LLP, represent
the Debtors.  Jeffrey K. Milton, Esq., Luc A. Despins, Esq.,
Matthew Scott Barr, Esq., and Paul D. Malek, Esq., at Milbank,
Tweed, Hadley & McCloy LLP represent the Official Committee of
Unsecured Creditors.

The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003.  On Jan. 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement.  On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on Nov. 17, 2004.


ENRON CORP: Wants to Merge Certain Debtor-Affiliates to Save Costs
------------------------------------------------------------------
Enron Creditors Recovery Corp. and its reorganized debtor
affiliates, and BDHLR LLC, as Reorganized Debtor Plan
Administrator, seek permission from the U.S. Bankruptcy Court for
the Southern District of New York to merge certain Reorganized
Debtors and related entities.

The Plan of Reorganization contemplates actions as may be
necessary to consummate the Plan and facilitate the ongoing
administration and liquidation of the Reorganized Debtors,
including, without limitation, the merger or consolidation of the
Reorganized Debtors, Brian S. Rosen, Esq., at Weil, Gotshal &
Manges LLP, in New York, relates.

According to Mr. Rosen, merger of the Reorganized Debtors, and
other Enron-related entities, with Enron or other Reorganized
Debtor as appropriate should result in substantial cost savings
for the Reorganized Debtors' estates.  He says the separate
estates are responsible for various state filing and
administrative fees, as well as related internal costs to monitor
and ensure that these numerous entities are in compliance with
laws.  He adds that the separate estates are responsible for
payment of taxes, certain statutory fees and other costs,
including tax preparation costs, for each of the remaining
Reorganized Debtor entities.  These fees and costs, including
taxes must continue to be paid for each Reorganized Debtor until
the time as a chapter 11 case for a particular Reorganized Debtor
is closed in accordance with the Plan.

Absent a merger, each of the Chapter 11 estates will continue to
be burdened by expenses and significant estate resources will be
expended to pay these mandatory costs, Mr. Rosen says.  "This
process of dissolving each of the Reorganized Debtor entities
will be extremely costly and time-consuming, up to two years, and
each estate will bear its own costs," he says.  "Merger, however,
will eliminate these separate costs and will provide a
considerable economic benefit for the Reorganized Debtors, their
estates and creditors."

As Reorganized Debtors and other Enron-related entities will
merge in name only, merger will not prejudice the rights or
interests of creditors pursuant to the Plan, Mr. Rosen says.  As
per the current practice, each of the Reorganized Debtors'
estates will continue to maintain separate accounting and
bookkeeping processes.  Distributions to creditors will continue
to be made in accordance with the Distribution Model of the Plan
and be predicated on the assets and liabilities of an individual
Debtor's Chapter 11 estate.  Essentially, there will be no effect
of the merger on Creditors or their entitled distributions.  
Rather, their distributions may even be enhanced and accelerated
due to the anticipated savings and speed with which the Chapter
11 cases will have been fully administered, Mr. Rosen says.

                         About Enron Corp.

Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on Dec. 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.  Judge
Gonzalez confirmed the Company's Modified Fifth Amended Plan on
July 15, 2004, and numerous appeals followed.  The Debtors'
confirmed chapter 11 Plan took effect on Nov. 17, 2004.

Albert Togut, Esq., at Togut Segal & Segal LLP, Brian S. Rosen,
Esq., Martin Soslan, Esq., Melanie Gray, Esq., Michael P. Kessler,
Esq., Sylvia Ann Mayer, Esq., at Weil, Gotshal & Manges LLP,
Frederick W.H. Carter, Esq., Michael Schatzow, Esq., Robert L.
Wilkins, Esq., at Venable, Baetjer and Howard, LLP, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft, LLP, represent
the Debtors.  Jeffrey K. Milton, Esq., Luc A. Despins, Esq.,
Matthew Scott Barr, Esq., and Paul D. Malek, Esq., at Milbank,
Tweed, Hadley & McCloy LLP represent the Official Committee of
Unsecured Creditors.

The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003.  On Jan. 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement.  On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on Nov. 17, 2004.


ENRON CORP: Court OKs $1.66 Bil. Citigroup Settlement Agreement
---------------------------------------------------------------
The Honorable Arthur Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York formally approved the settlement
agreement between Enron Creditors Recovery Corp. and its
reorganized debtor affiliates, and Citigroup, Inc., and
certain of its affiliates on April 24, 2008.

The Debtors sought formal approval of the settlement on April 7,
2008.

The global settlement, according to according to Enron's counsel,
David M. Stern, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, in
Los Angeles, California, is the eleventh and final settlement of
the MegaClaim Litigation.  He says, like the previous settlements
with other MegaClaim Defendants, the Citigroup Settlement
represents a significant benefit to the Enron Entities, as it
resolves several adversary proceedings pending before the Court,
settles multiple claims, brings $1.660 billion in immediate cash
into the estates of the Enron Entities for distribution to
creditors, and will allow the Enron Entities to release money
being held in reserve for billions of dollars in claims.

The global settlement provides that:

   (a) Citigroup will pay to $1.66 billion to Enron;

   (b) Citigroup agrees to the expungement or subordination of
       approximately $249.4 million in claims, as well as
       indemnity claims as to which the Court established a
       $4 billion reserve;

   (c) the CLN Trust Claims, which total more than $4.8 billion,
       and approximately $55 million of claims transferred to
       Springfield Associates, L.L.C., and Westpac Banking
       Corporation, are allowed; and

   (d) the parties agree to mutual releases, subject to carve
       outs as to certain claims created or preserved by the
       Global Settlement Agreement.

The Citigroup Settlement also provides for a comprehensive
settlement of these litigations:

   -- Adversary Proceeding No. 03-92701,

   -- Adversary Proceeding No. 03-93611,

   -- Adversary Proceeding No. 05-01025,

   -- portions of Adversary Proceeding No. 03-92677, and

   -- Yosemite Securities Trust I et al. v. Citibank N.A. et al.,
      (MDL-1446; Civ. No. H-05-1191), currently pending in the
      U.S. District Court of the Southern District of Texas.

Enron said the approval will permit $5 billion special
distribution to creditors, bringing total distributions to almost
$20 billion since the consummation of Enron's Plan in November
2004, Bloomberg News reported.

Enron also said the Citigroup settlement would bring unsecured
creditors' total recovery to 37.4%, Bloomberg added.  Enron said
the distributions were already 225% greater than the estimate
Enron made when it was confirming its Plan.  In its Plan filed
July 11, 2003, Enron estimated that unsecured creditors will
recover about 14.4% of their claims.

"The settlement with Citigroup marks an important milestone
in winding up the Enron Estate, and we are pleased that today the
court approved the settlement," said John Ray III, Enron
Creditors Recovery Corp.'s President and Chairman of the Board.  
"Upon implementation of the settlement, the Enron estate expects
to return approximately $5 billion to creditors, which brings us
to nearly $20 billion in total returned to creditors."

The MegaClaims suit was filed in 2003 by Enron Creditors
Recovery Corp. against eleven global banks and today's approval
of the Citigroup settlement brings this effort to a successful
close.

                         About Enron Corp.

Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on Dec. 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.  Judge
Gonzalez confirmed the Company's Modified Fifth Amended Plan on
July 15, 2004, and numerous appeals followed.  The Debtors'
confirmed chapter 11 Plan took effect on Nov. 17, 2004.

Albert Togut, Esq., at Togut Segal & Segal LLP, Brian S. Rosen,
Esq., Martin Soslan, Esq., Melanie Gray, Esq., Michael P. Kessler,
Esq., Sylvia Ann Mayer, Esq., at Weil, Gotshal & Manges LLP,
Frederick W.H. Carter, Esq., Michael Schatzow, Esq., Robert L.
Wilkins, Esq., at Venable, Baetjer and Howard, LLP, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft, LLP, represent
the Debtors.  Jeffrey K. Milton, Esq., Luc A. Despins, Esq.,
Matthew Scott Barr, Esq., and Paul D. Malek, Esq., at Milbank,
Tweed, Hadley & McCloy LLP represent the Official Committee of
Unsecured Creditors.

The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003.  On Jan. 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement.  On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on Nov. 17, 2004.


ENTEGRA TC: S&P Affirms 'B+' Rating on 2007 Recapitalization
------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' rating and
'1' recovery rating on debt issued in conjunction with electric
power generation company Entegra TC LLC's recapitalization in
2007. The outlook is stable.
     
The 2007 recapitalization consisted of the formation of a holding
company (Entegra Holdings LLC), which is subordinated to
intermediate holding company Entegra TC.  Entegra TC's rated
credit facilities consist of a $450 million second-lien senior
term loan due 2014 and a $30 million synthetic revolving credit
facility due 2012.  The loans sit behind an existing $350 million
first-lien letter of credit facility due 2012, used predominantly
for hedging purposes, and ahead of an $850 million third-lien
payment-in-kind senior term facility due 2015 (both unrated).

Entegra TC used the $1.33 billion of proceeds to refinance
$675 million of tranche A debt plus accrued interest, paid related
transaction expenses, and made a one-time distribution of
$545 million to members.  The '1' recovery rating of the second-
lien debt obligations indicates expectations of very high (90% to
100%) recovery of principal in a default scenario.
     
Entegra TC owns two primary subsidiaries (Gila River Power L.P.
and Union Power Partners L.P.), which own generation assets and
guarantee the loans. Gila River is a 2,146 MW combined-cycle gas
turbine plant at Gila Bend in Maricopa County, Arizona, that
dispatches in the Arizona-New Mexico-South Nevada subregion of the
Western Electricity Coordinating Council.  Union Power is a 2,152
MW CCGT plant near El Dorado, in south-central Arkansas, that
dispatches in the Entergy subregion of the Southeastern Electric
Reliability Council.  Entegra TC was created in June 2005, when
original asset owner Teco Energy Corp. transferred ownership to a
lender group via a Chapter 11 restructuring.  The plants were
built at a cost of $2.8 billion.  An affiliate of Entegra TC
manages and operates the plants.

"The stable outlook reflects our view that current expectations of
net revenues and the liquidity available to the company will be
sufficient to reduce the size of the second lien over the next
three years," said Standard & Poor's credit analyst Matthew Hobby.

However, under a low-gas-price scenario, the project would suffer
without the benefit of contracted revenues, and Standard & Poor's
could revise the outlook to negative or lower the ratings if spark
spreads deteriorate substantially or if loan paydown lags
expectations.  On the other hand, S&P could revise the outlook to
positive if market conditions improve further and allow Entegra TC
to enter more long-term contracts, and if continuing good
operating performance allows the company to repay sufficient debt
to ensure that it will substantially reduce the second-lien term
loan before maturity.


EOS AIRLINES: Organizational Meeting to Form Committees on May 8
----------------------------------------------------------------
Diana G. Adams, the United States Trustee for Region 2, will
convene an organizational meeting in Eos Airlines, Inc.'s chapter
11 case Thursday, May 8, 2008, at 11:00 a.m.  The meeting will be
held at the Office of the United States Trustee, located at 80
Broad Street, 4th Floor, in Manhattan.

The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' bankruptcy
cases.  This is not the meeting of creditors pursuant to Section
341 of the Bankruptcy Code.  However, a Debtor's representative
may attend and provide background information regarding the cases.

Headquartered in Purchase, New York, EOS Airlines, Inc. --
http://www.eosairlines.com/-- is a transatlantic airline.  The  
company filed for Chapter 11 protection April 26, 2008 (Bankr.
S.D.N.Y. Case No.08-22581).  Stephen D. Lerner, Esq., at Squire
Sanders & Dempsey, LLP, represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection against it
creditors, it listed total assets of $70,233,455 and total debts
of $34,858,485.


EXPRESS SCRIPTS: Moody's Withdraws Ba1 Corp. Family Rating
----------------------------------------------------------
Moody's Investors Service withdrew the rating of Express Scripts,
Inc. Moody's has withdrawn this rating for Moody's business
reasons.  Moody's added that the rating was withdrawn because this
issuer has no rated debt outstanding.

These rating of ExpressScripts has been withdrawn:

  -- Ba1 Corporate Family Rating

Express Scripts, Inc. is one of the nation's leading full service
pharmacy benefit managers, serving a variety of clients, including
managed care organizations, third-party administrators, government
and union-sponsored benefit plans and employers.


FAIRCHILD SEMICONDUCTOR: Moody's Holds Ba3 Corp. Family Rating
--------------------------------------------------------------
Moody's Investors Service affirmed Fairchild Semiconductor
Corporation's Ba3 corporate family rating and SGL-1 speculative
grade liquidity rating.  The rating continues to reflect the
company's moderate pro forma leverage, its favorable business
profile as the largest global supplier of power semiconductors,
and significant historical improvements in operating margins, but
also considers the highly competitive nature of the company's
markets, ongoing acquisition risk, and its exposure to softening
consumer end-markets.

Fairchild Semiconductor Corporation is a wholly owned subsidiary
of Fairchild Semiconductor International, Inc.

As such, Moody's will continue to monitor the company's business
strategy, the pricing environment, and its cost control efforts.   
In Moody's opinion, Fairchild's pro forma liquidity position is
very good due to its large cash and investments balance, favorable
debt maturity profile, and expectations for modest positive cash
flow, though offset by its lack of alternative liquidity as it
plans to fully draw the revolving credit facility.  The ratings
outlook remains positive.

Moody's affirmed the Ba2 rating on Fairchild's senior secured
credit facilities, under which the company plans to issue a
$100 million incremental term loan as permitted by the existing
credit agreement.  This prospective issuance would upsize the term
loan to $469 million from the current $369 million outstanding.  
Fairchild intends to use proceeds from the incremental term loan,
revolving credit facility borrowings, and cash to redeem the
$200 million convertible subordinated notes due November 2008
(not rated).  The incremental term loan has the same maturity date
as the existing term loan.  Given the proposed change to an all
bank debt capital structure, Moody's revised the probability-of-
default rating to B1 from Ba3, consistent with Moody's published
Loss Given Default Methodology.

The positive outlook reflects improvements in Fairchild's credit
metrics and operating margins, largely reflecting the benefit of
its initiatives to focus on higher margin products and reduce
earnings volatility.  The outlook also reflects Moody's
expectation that the company will reverse recent earnings
declines, sustain business volume, and continue to execute on its
strategy to increase the penetration of higher margin proprietary
products.

Despite the positive momentum in Fairchild's credit profile, an
uncertain economic environment precludes a ratings upgrade at this
time, particularly given the company's exposure to consumer-
oriented markets.  Additionally, Moody's is cognizant of potential
acquisition risk given modest organic growth rates and a weak
economic environment (implying potentially lower valuations).

These ratings were affirmed:

  -- Corporate family rating at Ba3;
  -- $100 million senior secured revolving credit facility due
     2012 at Ba2 (LGD2, 27%). Point estimate revised from
     (LGD2, 29%);

  -- $469 million (upsized from $369 million) senior secured term
     loan due 2013 at Ba2 (LGD2, 27%). Point estimate revised from
     (LGD2, 29%).

These rating was revised:

  -- Probability-of-default rating, to B1 from Ba3.

Fairchild Semiconductor Corporation, based in South Portland,
Maine, is the world's largest global supplier of power
semiconductors.  The company reported sales of approximately
$1.7 billion through the twelve months ended March 30, 2008.


FORT SHERIDAN: Collateral Deterioration Cues Fitch to Cut Ratings
-----------------------------------------------------------------
Fitch has downgraded six classes of notes issued by Fort Sheridan
ABS CDO, Ltd.

These rating actions are effective immediately:

  -- $760,979,919 Class A-1 downgrade to 'BB' from 'AAA', and
     remain on Rating Watch Negative;

  -- $34,589,996 Class A-2 downgrade to 'B' from 'AAA'; and
     remain on Rating Watch Negative;
  -- $44,966,995 Class B downgrade to 'CCC' from 'AA'; and removed
     from Rating Watch Negative;

  -- $11,076,885 Class C-1 downgrade to 'C' from 'BBB'; and
     removed from Rating Watch Negative;

  -- $1,704,136 Class C-2 downgrade to 'C' from at 'BBB'; and
     removed from Rating Watch Negative;

  -- $4,000,000 Class C-3 downgrade to 'C' from 'BBB', and removed
     from Rating Watch Negative.

Fort Sheridan is a collateralized debt obligation that closed
March 30, 2005 and is managed by Vanderbilt Capital Advisors LLC.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime
residential mortgage-backed securities, Alternative-A mortgage
loans, and structured finance CDOs with underlying exposure to
subprime RMBS.  Presently 25.4% of the portfolio is exposed to
2005, 2006 and 2007 U.S. subprime RMBS vintages, 24.7% is exposed
to 2005, 2006 and 2007 U.S. SF CDOs vintages and 16.1% of the
portfolio is exposed to 2005, 2006 and 2007 U.S Alt-A RMBS
vintages.  The portfolio has experienced negative rating migration
of 39.2% since Jan. 1, 2007 with 25.5% of the portfolio currently
on rating watch negative.  The negative credit migration is
primarily attributable to credit deterioration in subprime RMBS
bonds from the 2005, 2006 and 2007 vintages, coupled with
significant downgrades in SF CDOs originated between 2005 and
2007.

Since the last review on June 7, 2006, the deal has experienced
negative credit migration resulting in the Weighted Average Rating
Factor deteriorating to 3.67 which breaches its convent of 1.15,
as of the March 31, 2008 trustee report.  The class A/B and C
overcollateralization ratios are currently 101.77% and 99.79%
respectively which breach their covenants of 101.78% and 100.31%
respectively.  The classes A/B and C interest coverage test are
currently 117.10% and 112.79% respectively which have covenants of
102% and 100% respectively.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A mortgage loans.  The classes rated 'CCC' and
below are removed from Rating Watch as Fitch believes further
negative migration in the portfolio will have a lesser impact on
these classes.  Additionally, Fitch is reviewing its SF CDO
approach and will comment separately on any changes and potential
rating impact at a later date.

The ratings of the class A-1, A-2 and B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the aggregate
outstanding amount of principal by the stated maturity date.  The
ratings of the class C-1, C-2 and C-3 notes address the likelihood
that investors will receive ultimate interest and deferred
interest payments, as per the governing documents, as well as the
aggregate outstanding amount of principal by the stated maturity
date.


FULL COLOR SERVICES: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Full Color Services, Inc.
        dba Full Color Printing
        dba FCP
        dba FCPLV
        3347 S. Highland Dr. Ste. 310
        Las Vegas, NV 89109

Bankruptcy Case No.: 08-14190

Chapter 11 Petition Date: April 28, 2008

Court: District of Nevada (Las Vegas)

Debtor's Counsel: Robert E. Atkinson, Esq.
                  Email: r.atkinson@kupperlin.com
                  Kupperlin Law
                  10120 S. Eastern Ave., Ste. 226
                  Henderson, NV 89052
                  Tel: (702) 448 7010
                  Fax: (702) 947 6119
                  http://www.kupperlin.com/

Total Assets: $4,104,671

Total Debts:  $4,914,040

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Sharon Kerr                    Loan to company       $298,467
6301 Tara Ave.
Las Vegas, NV 89146

Daniel Kerr                    Loan to company       $115,000
6301 Tara Ave.
Las Vegas, NV 89146

Charles Kerr                   Loan to company       $114,603
6301 Tara Ave.
Las Vegas, NV 89146

Kelly Paper                    Vendor                $108,000

Highland Associates            Lessor                $85,000

Harold M. Pittman Co.          Vendor                $54,000

Valley View Business Center    Vendor                $48,000

Rare Group Enterprises, Inc.   Vendor                $38,000

Coatings & Adhesives Corp.     Vendor                $35,000

Gulf Pacific                   Vendor                $24,000

Unisource Distribution         Vendor                $23,846
Division

Actega Kelstar                 Vendor                $23,183

Arc Paper                      Vendor                $22,004

Tanaguchi Ink                  Vendor                $20,891

Rotadyne                       Vendor                $13,554

United Health Insurance        Vendor                $11,000

Hartford Insurance             Vendor                $10,000

Screen                         Vendor                $9,875

OCE                            Vendor                $9,672

Federal Express                Vendor                $7,893


GMAC LLC: ResCap Unit Launches Exchange Offer for $12.8 Bil. Notes
------------------------------------------------------------------
Residential Capital LLC commenced offers to exchange any and all
of the U.S. dollar equivalent $12.8 billion outstanding notes of
ResCap for newly issued notes, upon the terms and subject to the
conditions set forth in its Offering Memorandum and Consent
Solicitation Statement dated May 5, 2008, and the related letter
of transmittal and consent.  
    
The new notes will be issued by ResCap, will be guaranteed by
subsidiaries of ResCap and will be secured by a security interest
in substantially all of ResCap's existing and after acquired
unencumbered assets remaining available to be pledged as
collateral.

a) For 2008-2009 Notes:

CUSIP/ISIN: 76113BAL3 / US76113BAK52                 
Outstanding Principal Amount: $398,848,000
Title of Old Notes to be Tendered: Floating Rate Notes due 2008(1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $1,000
Tender After Early Delivery Time: $970

CUSIP/ISIN: 76113BAK5 / US76113BAK52       
Outstanding Principal Amount: $684,014,000
Title of Old Notes to be Tendered: 8.125% Notes due 2008 (1)       
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $1,000       
Tender After Early Delivery Time: $970

CUSIP/ISIN: 76113BAQ2 / US76113BAQ23       
Outstanding Principal Amount: $714,000,000
Title of Old Notes to be Tendered: Floating Rate Notes
                                   due April 2009 (1)       
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $900       
Tender After Early Delivery Time: $870

CUSIP/ISIN: 76114EAB8 / US76114EAB83               
Outstanding Principal Amount: $949,000,000
Title of Old Notes to be Tendered: Floating Rate Notes
                                   due May 2009
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $900       
Tender After Early Delivery Time: $870

CUSIP/ISIN: 76113BAN9 / US76113BAN91, U76134AD4 /
USU76134AD49                 
Outstanding Principal Amount: $576,961,000
Title of Old Notes to be Tendered: Floating Rate
Subordinated               
                                   Notes due 2009 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

b) For 2010-2015 Notes:

CUSIP/ISIN: 76113BAF6 / $2,154,500,000, 76113BAC3 / US76113BAC37,
            U76134AC6 / USU76134AC65              
Outstanding Principal Amount: $2,154,500,000
Title of Old Notes to be Tendered: 8.375% Notes due 2010 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0307840735         
Outstanding Principal Amount: EUR 542,800,000
Title of Old Notes to be Tendered: Floating Rate Notes due 2010
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAM1 / US76113BAM19               
Outstanding Principal Amount: $1,243,500,000
Title of Old Notes to be Tendered: 8.000% Notes due 2011 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0254758872    
Outstanding Principal Amount: EUR 550,000,000
Title of Old Notes to be Tendered: 7.125% Notes due 2012 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76114EAC6 / US76114EAC66                                   
Outstanding Principal Amount: $928,500,000
Title of Old Notes to be Tendered: 8.500% Notes due 2012
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAR0 / US76113BAR06                                
Outstanding Principal Amount: $1,604,500,000
Title of Old Notes to be Tendered: 8.500% Notes due 2013 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0254759920             
Outstanding Principal Amount: GBP 348,920,000
Title of Old Notes to be Tendered: 8.375% Notes due 2013 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0307841469             
Outstanding Principal Amount: GBP 363,000,000
Title of Old Notes to be Tendered: 9.875% Notes due 2014
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAE9 / US76113BAE92, U76134AB8 /
USU76134AB82              
Outstanding Principal Amount: $486,500,000
Title of Old Notes to be Tendered: 8.875% Notes due 2015 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

(1) Listed on the Luxembourg Stock Exchange.
   
In the exchange offers, ResCap is offering to issue new 8.500%
senior secured guaranteed notes due May 15, 2010 in exchange for
any and all old notes that mature in 2008 and 2009.  In addition,
ResCap is offering to issue new 9.625% junior secured guaranteed
notes due May 15, 2015 in exchange for any and all old notes that
mature in 2010 through 2015.

ResCap will mandatorily redeem one-third of the original principal
amount of each junior secured guaranteed note on May 15, 2013 and
May 15, 2014 with the remaining principal amount paid at maturity.   
All new notes will be denominated in U.S. dollars.  The offer to
exchange old notes for new notes is not subject to proration.  The
senior secured guaranteed notes will be secured on a second lien
basis by the collateral for the proposed new $3.5 billion credit
facility.  The junior secured guaranteed notes will be secured on
a third lien basis by the collateral for that facility.
    
In addition, holders participating in the exchange offers may
elect to receive cash in lieu of the new notes that they would
otherwise receive, pursuant to a "modified Dutch auction" process
described in the offer documents.  Each participating holder
electing to receive cash pursuant to the auction process, must
submit a price denominated in U.S. dollars that specifies the
minimum amount of cash such participating holder wishes to receive
in lieu of each $1,000 principal amount of new notes it would
otherwise receive for tendered old notes.

The indicative offer price specified by a participating holder of
old 2008-2009 notes can be no less than $850 per $1,000 principal
amount of new notes, the indicative offer price specified by a
participating holder of old 2010-2015 notes can be no less than
$650 per $1,000 principal amount of new notes, and in both cases
the indicative offer price specified by a participating holder can
be no greater than $1,000 per $1,000 principal amount of new
notes.  The amounts of cash that ResCap expects to have available
to pay participating holders in lieu of new notes that they would
otherwise receive in the exchange offers will be $700 million with
respect to the old 2008-2009 notes and $500 million with respect
to the old 2010-2015 notes.  Holders will receive new notes in
exchange for old notes submitted but not accepted in the auction
process.
    
Only old notes that are tendered in the exchange offers may
participate in the auction process.  However, old notes may be
tendered in the exchange offers without participating in the
auction process.

ResCap also commenced a cash tender offer for any and all of its
outstanding $1,198,710,000 in aggregate principal amount of
floating rate notes due June 9, 2008 at a purchase price of $1,000
per $1,000 principal amount upon the terms and subject to the
conditions set forth in the offering memorandum and the related
letter of transmittal and consent.  The total purchase price for
each $1,000 principal amount of June 2008 notes includes
an early delivery payment of $30.00 per $1,000 principal amount.   
The CUSIP and ISIN for the June 2008 notes are 76114EAA0 and
US76114EAA01.
    
In conjunction with the offers, ResCap is soliciting consents to
certain proposed amendments to the indentures under which the old
notes were issued.  The proposed amendments to the old notes would
release the subsidiary guarantees of ResCap's obligations under
the old notes and would eliminate certain of the restrictive
covenants and events of default currently in the indentures.   
However, the proposed amendments are not necessary for the
issuance of the new notes and the new subsidiary guarantees or for
the pledge of collateral for the new notes and subsidiary
guarantees.  Accordingly, the offers are not conditioned on
receipt of the requisite consents to adopt the proposed
amendments.
    
Claims with respect to new notes will be effectively senior to
claims with respect to unexchanged old notes.  In addition, claims
with respect to new notes will be effectively senior to claims
with respect to unexchanged old notes to the extent of the value
of all of the assets of the subsidiary guarantors if the requisite
consents from holders of the senior old notes are received.  
Claims with respect to new notes will be contractually senior to
the subordinated old notes.
    
In the offers, ResCap is offering an early delivery payment, which
in the case of the June 2008 notes and old notes that are accepted
in the auction process, will be paid in cash, and, in the case of
all other old notes, will be paid in principal of new notes.  The
early delivery payment will be paid only to holders who validly
tender their old notes, which tender will be deemed to include
their consents to the proposed amendments, prior to 5:00 p.m., New
York City time, on May 16, 2008, unless extended by ResCap with
respect to any or all series of old notes, and do not validly
withdraw their tenders.
    
The offers will expire at 11:59 p.m., New York City time, on
June 3, 2008, unless extended by ResCap with respect to any or all
series of old notes.  Tendered old notes may be validly withdrawn
at any time prior to 5:00 p.m., New York City time, on May 16,
2008, unless extended by ResCap with respect to any or all series
of old notes, but not thereafter.
    
Holders of old notes accepted in the offers will receive a cash
payment equal to the accrued and unpaid interest in respect of
such old notes from the most recent interest payment date to, but
not including, the settlement date.
    
The offers are conditioned on the satisfaction or waiver of
certain conditions.  In particular, the offers are conditioned on
ResCap entering into a new first lien senior secured credit
facility, providing for at least $3.5 billion of commitments on
terms acceptable to ResCap.  As a result of these conditions,
ResCap may not be required to exchange or purchase any of the old
notes tendered.  The offers are not conditioned on receipt of the
requisite consents with respect to the old notes.  ResCap is
currently in negotiations with GMAC LLC, who would act as the
lender under this new first lien senior secured credit facility
which, if entered into, will be on terms acceptable to ResCap and
GMAC.  The new facility would:

     1. fund the cash required for the offers,

     2. repay ResCap's term loan maturing in July 2008, and

     3. replace ResCap's existing $875.0 million 364-day and
        $875.0 million 3-year revolving bank credit facilities.

Documents relating to the offers will only be distributed to
noteholders who complete and return a letter of eligibility
confirming that they are within the category of eligible investors
for this private offer.  Noteholders who desire a copy of the
eligibility letter should contact Global Bondholder Service
Corporation, the information agent for the offers, at (866) 470-
3800 (U.S. Toll-free) or (212) 925-1630 (Collect).

As reported in the Troubled Company Reporter on April 25, 2008,
Residential Funding Company and GMAC Mortgage LLC, both
subsidiaries of Residential Capital, LLC, borrowed $468 million
collectively under a Loan and Security Agreement with ResCap's
parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with
a revolving credit facility with a principal amount of up to
$750 million, providing incremental liquidity for ResCap's
operations until longer-term financing is arranged.  

ResCap and GMAC are investigating various strategic alternatives
related to all aspects of ResCap's business, including extensions
and replacements of existing secured borrowing facilities, and
establishing additional sources of secured funding for ResCap's
operations.  One potential source of new secured funding is credit
secured by certain of ResCap's mortgage servicing rights.

The Troubled Company Reporter also reported on April 9, 2008 that
GMAC LLC purchased $1.2 billion of ResCap's notes in open market.    
The notes have a fair value of approximately $607,192,000 to
ResCap in exchange for 607,192 ResCap Preferred units with a
liquidation preference of $1,000 per unit.  ResCap canceled the
$1.2 billion face amount of notes.  GMAC may, in its sole
discretion, on or before May 31, 2008, contribute up to an
additional approximately $340 million of ResCap notes, having a
fair value of approximately $265,779,000, for additional ResCap
Preferred units.  The ResCap Preferred ranks senior in right of
payment to ResCap's common membership interests with respect to
distributions and payments on liquidation, winding-up or
dissolution of ResCap.

                    About Residential Capital

Headquartered in Minneapolis, Minnesota, Residential Capital LLC
-- http://www.rescapholdings.com/-- is the home mortgage unit of       
GMAC Financial Services, which is in turn wholly owned by GMAC
LLC.

                          About GMAC LLC

GMAC LLC -- http://www.gmacfs.com/-- formerly General Motors      
Acceptance Corporation, is a global, diversified financial
services company that operates in approximately 40 countries in
automotive finance, real estate finance, insurance and other
commercial businesses.  GMAC was established in 1919 and employs
approximately 26,700 people worldwide.  Cerberus Capital
Management LP bought 51% GMAC LLC stake from General Motors Corp.
on December 2006.

As reported in the Troubled Company Reporter on April 25, 2008,
Residential Funding Company and GMAC Mortgage LLC, both
subsidiaries of Residential Capital, LLC, borrowed $468 million
collectively under a Loan and Security Agreement with ResCap's
parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with
a revolving credit facility with a principal amount of up to
$750 million, providing incremental liquidity for ResCap's
operations until longer-term financing is arranged.

Similarly, the Troubled Company Reporter also reported on April
25, 2008 that Moody's Investors Service downgraded GMAC LLC's
senior rating to B2 from B1; the rating remains on review for
further possible downgrade.

The GMAC downgrade is based upon Moody's opinion that further
operating weakness at ResCap poses risks to GMAC's capital
position and liquidity that exceed previous estimates.  In
particular, Moody's believes that for ResCap to have continued
access to debt capital, GMAC may be required to provide additional
indications of support to the unit and that it is likely to do so.   


GMAC LLC: Fitch Cuts ID Rating to BB- After ResCap's Poor Fin'l
---------------------------------------------------------------
Fitch Ratings has downgraded the long-term Issuer Default Rating
of GMAC LLC and related subsidiaries to 'BB-' from 'BB'.  Fitch
has also downgraded GMAC's unsecured long-term ratings to 'B+'
from 'BB-', reflecting the potential for reduced recovery in a
default scenario should the company encumber assets.  
Additionally, Fitch has affirmed the 'B' short-term ratings.  The
Rating Outlook remains Negative. Approximately $85 billion of
unsecured debt is affected by this action.

The downgrade of GMAC's L-T IDR reflects in part continued
financial deterioration at ResCap, which has necessitated further
financial support from GMAC as part of a debt exchange at ResCap.   
In addition, given the current capital markets environment, Fitch
believes that GMAC may need to encumber assets to enhance its
liquidity.  To the extent this occurs, it would subordinate
current debtholders and reduce recovery prospects in a default
scenario.

Fitch's Negative Outlook on GMAC continues to reflect the more
challenging economic environment that will continue to pressure
core operating performance.  Given reduced industry sales, GMAC's
financing volumes will likely decline unless offset by higher
penetration rates.  In addition, Fitch expects automotive credit
quality to remain pressured throughout 2008 due to rising consumer
defaults and higher loss severity upon default.  Ratings could be
lowered if core profitability (excluding ResCap) weakens coupled
with credit quality deterioration beyond historical averages.

Fitch has downgraded these ratings with a Negative Outlook:

GMAC LLC
GMAC International Finance B.V.
GMAC Bank GmbH
GMAC Canada Ltd.
General Motors Acceptance Corp. of Canada Ltd.
General Motors Acceptance Corp. of Australia
  -- Long-term IDR to 'BB-' from 'BB';
  -- Senior debt to 'B+' from 'BB'.

General Motors Acceptance Corp. (NZ) Ltd.
  -- Long-term IDR to 'BB-' from 'BB'.

Fitch has also affirmed these ratings:

GMAC LLC
GMAC International Finance B.V.
GMAC Bank GmbH
General Motors Acceptance of Canada Ltd.
General Motors Acceptance Corp. of Australia
GMAC Australia (Finance) Ltd.
General Motors Acceptance Corp. (U.K.) Plc
General Motors Acceptance Corp. (N.Z.) Ltd.
GMAC Canada Ltd.
  -- Short-term IDR 'B';
  -- Short-term debt 'B'.

GMAC Canada Ltd.
  -- Short-term IDR 'B'.


GMAC LLC: S&P 'B' Rating Unaffected by ResCap's Downgrades
----------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings and
negative outlook on GMAC LLC (B/Negative/C) will not be affected
by the downgrade of its 100%-owned subsidiary, Residential Capital
LLC to 'CC' from 'CCC+'.

The ratings actions on Residential Capital LLC follow the
company's launch of an exchange offer for unsecured bonds that
would pay less than face value to certain Residential Capital LLC
bondholders.  The exchange illustrates the gravity of the
Residential Capital LLC's financial position.   Furthermore, the
exchange indicates that GMAC LLC's ultimate parents, General
Motors Corp. (49% owner of GMAC LLC) and Cerberus (51% owner of
GMAC LLC), are pursuing these actions rather than directly provide
GMAC LLC with additional capital to downstream to Residential
Capital LLC.  However, a successful exchange would extend debt
maturities, providing needed relief to both Residential Capital
LLC in terms of its maturing debt, and GMAC LLC in terms of future
support pressures.



GENERAL MOTORS: ResCap's Offer Does Not Affect S&P's Neg. Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services said its 'B' long-term and 'B-
3' short-term corporate credit ratings on General Motors Corp.
remain on CreditWatch with negative implications, where they were
placed March 17, 2008.  The update follows the announcement by
Residential Capital LLC (CC/Watch Neg/C) that it is launching an
exchange offer for unsecured bonds, which S&P interpret to be a
distressed debt exchange. (Residential Capital is a unit of 49%-
owned unit GMAC LLC [B/Negative/C].  
     
S&P do not expect GM to provide any significant capital to GMAC or
indirectly to Residential Capital, nor is GM required to do so in
the future.
     
GM's ratings were placed on CreditWatch because of the strike at
major supplier American Axle & Manufacturing Holdings Inc., which
began Feb. 26.  The strike caused GM to lose 100,000 units of
production in the first quarter of 2008, mostly full-size pickups.
     
"Negotiations are continuing, and media reports indicate that the
strike is closer to being resolved," said Standard & Poor's credit
analyst Gregg Lemos Stein.  "But until American Axle's production
resumes, we won't know the full extent of the strike's effect on
GM's liquidity."
     
GM's second-quarter results will be affected as well, and in light
of weak sales and deteriorating demand for pickups and SUVs, GM
recently announced production cuts beyond those caused by the
strike.  GM should benefit from working capital increases once
American Axle resumes production, even if future production levels
do not fully replace that lost during the strike.  S&P expect GM
to be able to maintain adequate available liquidity in 2008; at
March 31, 2008, the company had $23.9 billion, including cash,
marketable securities, $700 million in short-term VEBA funds, and
a $4.5 billion secured revolving credit facility.
     
Another uncertainty for GM, although less of a pressing issue in
the near term, is former supplier Delphi Corp.'s difficulties in
emerging from bankruptcy.  S&P still believe the comprehensive
costs to GM of Delphi's reorganization will remain within the
scope of GM's liquidity.  Still, the current capital market
turmoil may keep Delphi in Chapter 11 for several more months, if
not the rest of 2008.  GM recently said it will make advance
payments of up to $650 million to Delphi over the course of 2008,
an amount that is within our range of expectations, even if Delphi
had emerged from bankruptcy.  However, S&P's ratings do not leave
any room for GM to make substantial cash payments to support a
revised Delphi capital structure beyond the labor and transitional
subsidies GM has already agreed to provide.  
     
S&P will likely not resolve the GM CreditWatch until after the
American Axle strike has been resolved and S&P have assessed its
effect on GM's liquidity in light of the deteriorating U.S. auto
industry environment.  S&P's analysis will also incorporate those  
concerns.


GUARDIAN TECH: Secures $7 Million Financing from Nine Investors
---------------------------------------------------------------
Guardian Technologies International Inc. entered into definitive
agreements with five existing and four new accredited investors
with respect to the private placement of approximately
10.0 million shares of its common stock at a purchase price of
$0.70 per share for expected gross proceeds of approximately
$7.0 million.  There were no discounts or brokerage fees
associated with the offering.

Guardian expects to utilize the proceeds to advance its
international business development activities, healthcare research
and development activities, and fund general corporate operations.
Two closings are scheduled to occur with $5.15 million having
closed on April 4, 2008, and the second closing expected to occur
on or about May 30, 2008, subject to customary closing conditions.

"Completing this financing transaction increases our financial
strength and stability, and positions us to advance our strategic
initiatives," Bill Donovan, president and chief operating officer
of Guardian, said.  "We deeply appreciate the continuing
confidence of our existing investors and we welcome our new
investors.  With the current state of the liquidity markets, this
financing, structured at a premium to our stock's market price,
would be an unambiguous indication to the market that our
international business development initiatives and partnerships
are well-positioned to generate near-term revenues."

                   About Guardian Technologies

Based in Herndon, Virginia, Guardian Technologies International
Inc. (OTC BB: GDTI.OB) -- http://www.guardiantechintl.com/-- is a
technology company that designs and develops imaging informatics
solutions for delivery to its target markets: aviation/homeland
security and healthcare.

As reported in the Troubled Company Reporter on Dec. 14, 2007, the
company's consolidated balance sheet at Sept. 30, 2007, showed
$2.4 million in total assets, $11.0 million in total liabilities,
and $246,911 in common shares subject to repurchase, resulting in
an $8.8 million total stockholders' deficit.

As reported in the Troubled Company Reporter on April 14, 2008,
Guardian Technologies disclosed in a SEC filing that the company
did not make timely payment of the interest due under its Series A
10% Senior Convertible Debentures on Jan. 1, 2008.  However, the
company said it has paid all of the interest and late fees due to
debenture holders as of April 8, 2008.  

The company further disclosed that while the debenture holders
have not elected to require the company to make immediate
repayment of the mandatory default amount, in accordance with the
debenture terms, there can be no assurance they will not do so.

                       Going Concern Doubt

Goodman & Company L.L.P., in Norfolk, Virginia, expressed
substantial doubt about Guardiain Technologies International
Inc.'s  ability to continue as a going concern after auditing the
company's consolidated financial statements for the years ended
Dec. 31, 2006, and 2005.  The auditing firm reported that the
company has incurred significant operating losses since inception
and is dependent upon its ability to raise additional funding
through debt or equity financing to continue operations.

The company reported a net loss of $3.4 million on net revenues of
$43,778 for the third quarter ended Sept. 30, 2007, compared with
a net loss of $3.3 million on net revenues of $51,197 for the same
period in 2006.


INTERNATIONAL PAPER: Net Income Drops to $133MM in '08 1st Quarter
------------------------------------------------------------------
International Paper reported preliminary first-quarter 2008 net
earnings of $133 million compared with net earnings of
$327 million in the 2007 fourth quarter and $434 million in the
first quarter of 2007.

Earnings from continuing operations and before special items in
the first quarter of 2008 were $175 million, compared with
$294 million in the 2007 fourth quarter and $203 million in the
first quarter of 2007.

Quarterly net sales were $5.7 billion, down from $5.8 billion in
the fourth quarter and up from $5.2 billion in the first quarter
of 2007.

Industry segment operating profits were $332 million for the 2008
first quarter versus $566 million in the 2007 fourth quarter and
$403 million in the first quarter of 2007.  The quarter-to-quarter
decrease reflects higher input costs, lower earnings from land
sales and operating performance below expectations early in the
quarter.

Additionally, the company reported equity earnings, net of taxes,
of $17 million from its 50% investment in Ilim Holding S.A., a
separate reportable industry segment in Russia.

"We continued to realize price improvement in the first quarter,"  
John Faraci, chairman and CEO, said.  "However, those gains were
more than offset by sharply increasing input costs, well as the
expected quarter-to-quarter decline in earnings from land sales."

"We are prepared to work through the weakness of the U.S. economy.
Our business outside of North America continues to demonstrate
healthy growth and solid pricing," Mr.Faraci said.

At March 31, 2008, the company's balance sheet showed total assets
of $24.3 billion, total liabilities of $15.3 billion and total
shareholders' equity of about $9.0 billion.

                 About International Paper

Headquartered in Stamford, Connecticut, International Paper Co.
(NYSE: IP) -- http://www.internationalpaper.com/-- is an uncoated     
paper and packaging company with primary markets and manufacturing
operations in North America, Europe, Russia, Latin America, Asia
and North Africa.  International Paper employs approximately
54,000 people in more than 20 countries, and serves customers
worldwide.  

                         *     *     *

Moody's Investors Service placed International Paper Co.'s senior
subordinate rating at 'Ba1' in December 2005.  The rating still
holds to date with a stable outlook.


INTERPUBLIC GROUP: Net Loss Lowers to $62MM in 2008 First Quarter
-----------------------------------------------------------------
Interpublic Group of Cos. reported net loss of $62.8 million
compared with a year-earlier net loss of $125.9 million, Kathy
Shwiff and Kevin Kingsbury of The Wall Street Journal reports.

According to WSJ, citing a poll by Thomson Reuters, revenue
increased 9.3% to $1.49 billion while organic revenue -- excluding
divestitures, acquisitions and foreign-currency translation --
rose 5.1%.  Analysts' mean estimates were for a loss of 16 cents a
share on revenue of $1.44 billion, WSJ adds.

WSJ notes that Interpublic is in the middle of a turnaround after
correcting accounting problems that had dogged it for several
years.

New York-based, Interpublic Group of Companies Inc. (NYSE: IPG)
-- http://www.interpublic.com/-- is one of the world's leading      
organizations of advertising agencies and marketing services
companies.  Major global brands include Draftfcb, FutureBrand,
GolinHarris International, Initiative, Jack Morton Worldwide, Lowe
Worldwide, MAGNA Global, McCann Erickson, Momentum, MRM Worldwide,
Octagon, Universal McCann and Weber Shandwick.  Leading domestic
brands include Campbell-Ewald, Carmichael Lynch, Deutsch, Hill
Holliday, Mullen, The Martin Agency and R/GA.

                          *     *     *

As reported in the Troubled Company Reporter on April 9, 2008,
Fitch Ratings has upgraded Interpublic Group of Companies' issuer
default rating to 'BB+' from 'BB-'.  Approximately $2.1 billion in
total debt and $525 million in preferred stock as of Dec. 31, 2007
is affected.  The rating outlook is positive.


ION MEDIA: S&P Puts '3' Recovery Rating on CCC+ Rated $400MM Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned recovery ratings to
ION Media Networks Inc.'s (CCC+/Negative/--) $400 million floating
rate first priority secured notes due 2012 and $405 million
floating rate second priority secured notes due 2013.

The issue-level rating on ION Media's $400 million floating rate
first priority secured notes due 2012 remains 'CCC+', and a
recovery rating of '3' was assigned, indicating S&P's expectation
for meaningful (50%-70%) recovery in the event of a payment
default.

The issue-level rating on ION Media's $405 million floating rate
second priority secured notes due 2013 remains 'CCC-', and a
recovery rating of '6' was assigned, indicating our expectation
for negligible (0%-10%) recovery in the event of a payment
default.

Additionally, the company has a $325 million term loan and
convertible senior subordinated notes that S&P do not rate.

Ratings List
Ratings Assigned

ION Media Networks Inc.
Recovery Rating ($400M First Priority Notes)        3
Recovery Rating ($405M Second Priority Notes)       6

Ratings Affirmed

ION Media Networks Inc.
$400M Floating Rate First Priority                  CCC+
$405M Floating Rate Second Priority                 CCC-


IPCS INC: S&P Affirms 'B-' Rating and Changes Outlook to Stable
---------------------------------------------------------------
Standard & Poor's Rating Services revised its outlook on
Schaumburg, Illinois-based iPCS Inc. to stable from negative.  All
existing ratings, including the 'B-' corporate credit rating, were
affirmed.
      
"The stable outlook revision reflects the resolution of a number
of operational and financial issues between Sprint Nextel Corp.
and iPCS, which dampened iPCS' 2007 operating performance," said
Standard & Poor's credit analyst Susan Madison.
     
iPCS is a Sprint PCS affiliate serving approximately 640,600
subscribers, with the exclusive right to provide Sprint PCS
digital wireless services to 80 markets located in Illinois,
Michigan Pennsylvania, Indiana, Iowa, Ohio and Tennessee covering
15.1 million population equivalents.  Debt outstanding for the
consolidated company as of Dec. 31, 2007, totaled about
$475 million.
     
The ratings on iPCS reflect an aggressive financial policy, its
reliance on Sprint Nextel, which owns the wireless spectrum
licenses used by the company to provide service; its highly
leveraged financial profile and below average profitability.  
Tempering factors include opportunity for growth given the
company's relatively low 5.3% penetration rate of covered
population equivalents and adequate liquidity.


IPSWICH STREET: Fitch Cuts Six Note Ratings and Removes Neg. Watch
------------------------------------------------------------------
Fitch downgrades and removed from Rating Watch Negative six
classes of notes issued by Ipswich Street CDO, Ltd./LLC.  These
rating actions are effective immediately:

  -- $1,528,551,908 Class A-1 Notes downgraded to 'CCC' from
     'BBB-' and removed from Rating Watch Negative;

  -- $60,000,000 Class A-2 Notes downgraded to 'CC' from 'BB' and
     removed from Rating Watch Negative;

  -- $62,000,000 Class B Notes downgraded to 'CC' from 'BB-' and
     removed from Rating Watch Negative;

  -- $25,393,543 Class C Notes downgraded to 'C' from 'B-' and
     removed from Rating Watch Negative;

  -- $9,650,486 Class D Notes downgraded to 'C' from 'CCC' and
     removed from Rating Watch Negative;

  -- $8,302,774 Class E Notes downgraded to 'C' from 'CC' and
     removed from Rating Watch Negative.

Ipswich Street is a collateralized debt obligation that closed on
June 27, 2006 and is managed by Massachusetts Financial Services
Company.  Presently 53.2% of the portfolio is comprised of 2005,
2006 and 2007 vintage U.S. subprime residential mortgage-backed
securities, 6.5% consists of 2005, 2006 and 2007 vintage U.S.
structured finance CDOs and 3.4% is comprised of 2005, 2006 and
2007 vintage U.S. Alt-A RMBS.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS, and SF CDOs with underlying exposure to subprime RMBS.  
Since Nov. 21, 2007, approximately 52.7% of the portfolio has been
downgraded with 11.9% of the portfolio currently on Rating Watch
Negative. 38.3% of the portfolio is now rated below investment
grade.  Fitch notes that, overall, 27.3% of the assets in the
portfolio now carry a rating below the rating it assumed in
November 2007.  

The negative credit migration experienced since the last review on
November 21, 2007 has resulted in the Weighted Average Rating
Factor deteriorating to 11.38 from 2.55, breaching its covenant of
1.45, as of the March 31, 2008 trustee report.

The collateral deterioration has caused each of the class A/B,
class C and class D overcollateralization tests, class A
Sequential Pay test and class E interest diversion tests to fall
below 100% and fail their respective triggers.  The failures of
these tests are diverting interest proceeds to attempt to cure the
tests and therefore exhausting remaining interest proceeds before
the class C, class D, and class E interest payments are made.

Fitch expects these classes to receive only capitalized interest
payments in the future with no ultimate principal recovery.  The
ratings of the classes A-1, A-2, and B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the transaction's governing documents, as well as
the aggregate outstanding amount of principal by the stated
maturity date.

The ratings of the class C, D, and E notes address the likelihood
that investors will receive ultimate and compensating interest
payments, as well as the aggregate outstanding amount of principal
by the stated maturity date, pursuant to the transaction's
governing documents.  The ratings are based upon the capital
structure of the transaction, the quality of the collateral, and
the protections incorporated within the structure.


ISLE OF CAPRI: S&P Lowers BB- Rating to B+ and Removes Neg. Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on St.
Louis, Missouri-based Isle of Capri Casinos Inc.; the corporate
credit rating was lowered to 'B+' from 'BB-'.  The ratings were
removed from CreditWatch, where they were placed with negative
implications March 6, 2008.  The rating outlook is negative.
     
In addition, S&P assigned a recovery rating to Isle's 7% senior
subordinated notes due March 1, 2014, while lowering the issue-
level rating on these securities to 'B-' from 'B', in conjunction
with the corporate credit rating change.  A recovery rating of '6'
was assigned to this debt, indicating that lenders can expect
negligible (0% to 10%) recovery in the event of a payment default.      

"The downgrade and negative outlook reflect credit measures that
have been weak for the rating for an extended period, resulting
from a shortfall in EBITDA generation relative to our previous
expectations," explained Standard & Poor's credit analyst Ariel
Silverberg.
     
Isle's inability to improve credit measures at the pace that S&P
expected has been due to a slower ramp-up at the company's Pompano
Park, Waterloo, and Coventry properties, as well as weakness in
operating performance at several of Isle's other properties,
including its Mississippi properties, which contribute, on
average, 30% to the company's EBITDA base.  New management has
been installed in the last several months to improve operations,
and S&P expect its efforts to be reasonably successful, somewhat
tempered by the negative impact that S&P anticipate from economic
conditions during 2008.  The new rating incorporates the
expectation for EBITDA in the fiscal year ended April 30, 2009 to
be at least flat with fiscal 2008 EBITDA.
     
The 'B+' rating reflects Isle's highly leveraged capital
structure, vulnerability to competitive pressures due to the
second-tier market position of many of its properties, and a
historically aggressive growth strategy.  These factors are
somewhat tempered by the geographically diverse portfolio of the
company's gaming assets and the company's experienced management
team.
     
Isle wholly owns and operates 14 casino gaming facilities in the
U.S. located in Black Hawk, Colorado; Lake Charles, Louisiana;
Lula, Biloxi, and Natchez, Mississippi; Kansas City,
Caruthersville, and Booneville, Missouri; Bettendorf, Davenport,
Waterloo, and Marquette, Iowa; and Pompano Beach, Florida.  The
company also owns casinos in Freeport, Grand Bahamas and Coventry,
England, and has a two-thirds ownership interest in casinos in
Dudley and Wolverhampton, England.


KLEROS PREFERRED: Fitch Junks Ratings on Four Note Classes
----------------------------------------------------------
Fitch has downgraded seven classes of notes issued by Kleros
Preferred Funding II, Ltd.  These rating actions are effective
immediately:

  -- $819,559,570 class A-1NV downgraded to 'BB' from 'AAA' and
     placed on Rating Watch Negative;

  -- $235,573 class A-1V downgraded to 'BB' from 'AAA' and placed
     on Rating Watch Negative;

  -- $58,429,928 class A-2 downgraded to 'B' from 'AAA' and
     remains on Rating Watch Negative;

  -- $33,110,292 class B downgraded to 'CCC' from 'AA' and removed
     on Rating Watch Negative;

  -- $7,790,657 class C downgraded to 'CC' from 'AA-' and removed
     on Rating Watch Negative;

  -- $9,555,226 class D downgraded to 'C' from 'A' and removed
     from Rating Watch Negative;

  -- $10,762,374 class E downgraded to 'C' from 'BBB' and removed
     from Rating Watch Negative.

Kleros II is a collateralized debt obligation that closed Jan. 10,
2006 and is managed by Strategos Capital Management, LLC.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime
residential mortgage-backed securities, Alternative-A RMBS, and
structured finance CDOs with underlying exposure to subprime RMBS.  
Since the last rating action on January 18, 2008 approximately
34.2% of the portfolio has been downgraded with 14.9% of the
portfolio currently on Rating Watch Negative.  The negative credit
migration is primarily attributable to credit deterioration in
subprime RMBS bonds from the 2005, 2006 and 2007 vintages, coupled
with significant downgrades in SF CDOs originated between 2005 and
2007.

Kleros II has a static portfolio comprised primarily of subprime
RMBS bonds (61.4%), Alt-A RMBS (13.73%), prime RMBS (12.28%), SF
CDOs (11.27%) and other structured finance assets.  Subprime RMBS
bonds of the 2005 and 2006 vintages account for approximately
55.24% and 0.32% of the portfolio, respectively.  The portfolio
does not contain any subprime RMBS bonds of 2007 vintage.  
Likewise, the SF CDO exposure includes 3.38% SF CDOs originated in
2005.  Alt-A RMBS of 2005 vintage represent approximately 12.28%
of the portfolio.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A RMBS.  The classes rated 'CCC' and below are
removed from Rating Watch as Fitch believes further negative
migration in the portfolio will have a lesser impact on these
classes.  Additionally, Fitch is reviewing its SF CDO approach and
will comment separately on any changes and potential rating impact
at a later date.

The ratings of the class A, B and C notes address the likelihood
that investors will receive full and timely payments of interest,
as per the transaction's governing documents, as well as the
stated balance of principal by the legal final maturity date.  The
ratings of the class D and E notes address the likelihood that
investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


LEXINGTON PRECISION: Gets Final Approval to Use $4 Mil. Facility
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Lexington Precision Corp. and Lexington Rubber Group Inc. to
obtain, on a final basis, up to $4,000,000 in postpetition
financing from Lubin Partners LLC, William B. Conner, and ORA
Associates LLC, as lenders, Bloomberg News reports.

As reported in the Troubled Company Reporter on April 9, 2008,
the Court gave the Debtors permission to access, on an interim
basis, $2,000,000 of a possible $4,000,000 in financing.  The
lenders' facility will terminate on the earliest of:

   -- the one year anniversary of the Debtors' bankruptcy filing;

   -- the effective date of a confirmed Chapter 11 plan of
      reorganization in these Chapter 11 cases;

   -- the conversion of any of these Chapter 11 cases to cases
      under Chapter 7 of the Bankruptcy Code;

   -- the appointment of a Chapter 11 trustee in any of these
      Chapter 11 cases or the appointment of an examiner with
      expanded powers to operate or manage the financial affairs,
      the business or the reorganization of any Debtor; and

   -- the date of acceleration by the DIP Lenders.

According to papers filed with the Court, the proceeds of the DIP
loan will be used to finance working capital requirements and
general corporate purposes in regard to the Debtors' postpetition
operations.

The lenders' facility will incur interest at LIBOR plus 7% per
annum with a LIBOR floor of 3% per annum.  The Debtors will pay
$80,000 fee in the aggregate to the DIP lenders.

The DIP lien is subject to a $500,000 carve-out for payment of
U.S. Trustee fees, Clerk of Court fees, and fees payable to
professionals retained in the Debtors' cases.

Pursuant to Section 364(c)(1) of the Bankruptcy Code, all
obligations under the DIP loans will be entitled to super-priority
administrative expense status.

                           DIP Lenders

Michael A. Lubin, the co-chief executive officer of the Debtors,
owns $7,011,000 of the principal amount with respect to the
Debtors' senior subordinated notes.  Mr. Lubin also owns 13%
junior subordinated notes.  In regard to the equity of the
Debtors:

   -- Mr. Lubin and his affiliates hold 1,523,279 common shares
      and owns 78077 warrants to purchase the common stock of the
      Debtors at $3.50 per share;

   -- Mr. Lubin owns an additional 89,062 shares held by Lubin
      Delano & Co. Profit Sharing Trust; and

   -- Lubin Delano owns an additional 3,110 warrants.

Mr. Lubin is a managing member of lender Lubin Partners.

Mr. Conner is a director of the Debtors and owns 364,894 commons
shares with respect to the equity.

ORA Associates is not neither an affiliate of the Debtors nor of
the other DIP lenders.

                     About Lexington Precision

Headquartered in New York, Lexington Precision Corp. --
http://www.lexingtonprecision.com/-- manufacture tight-tolerance
rubber and metal components for use in medical, automotive, and
industrial applications.  As of Feb. 29, 2008, the companies
employed about 651 regular and 22 temporary personel.

The company and its affiliate, Lexington Rubber Group Inc., filed
for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead
Case No.08-11153).  Richard P. Krasnow, Esq., at Weil, Gotshal &
Manges, represents the Debtors in their restructuring efforts.  
The U.S. Trustee for Region 2 has not appointed creditors to serve
on an Official Committee of Unsecured Creditors in these cases.

When the Debtors filed for protection against their creditors,
they listed total assets of $52,730,000 and total debts of
$88,705,000.


LEXINGTON PRECISION: Gets Final Approval to Use $4 Mil. Facility
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Lexington Precision Corp. and Lexington Rubber Group Inc. to
obtain, on a final basis, up to $4,000,000 in postpetition
financing from Lubin Partners LLC, William B. Conner, and ORA
Associates LLC, as lenders, Bloomberg News reports.

As reported in the Troubled Company Reporter on April 9, 2008,
the Court gave the Debtors permission to access, on an interim
basis, $2,000,000 of a possible $4,000,000 in financing.  The
lenders' facility will terminate on the earliest of:

   -- the one year anniversary of the Debtors' bankruptcy filing;

   -- the effective date of a confirmed Chapter 11 plan of
      reorganization in these Chapter 11 cases;

   -- the conversion of any of these Chapter 11 cases to cases
      under Chapter 7 of the Bankruptcy Code;

   -- the appointment of a Chapter 11 trustee in any of these
      Chapter 11 cases or the appointment of an examiner with
      expanded powers to operate or manage the financial affairs,
      the business or the reorganization of any Debtor; and

   -- the date of acceleration by the DIP Lenders.

According to papers filed with the Court, the proceeds of the DIP
loan will be used to finance working capital requirements and
general corporate purposes in regard to the Debtors' postpetition
operations.

The lenders' facility will incur interest at LIBOR plus 7% per
annum with a LIBOR floor of 3% per annum.  The Debtors will pay
$80,000 fee in the aggregate to the DIP lenders.

The DIP lien is subject to a $500,000 carve-out for payment of
U.S. Trustee fees, Clerk of Court fees, and fees payable to
professionals retained in the Debtors' cases.

Pursuant to Section 364(c)(1) of the Bankruptcy Code, all
obligations under the DIP loans will be entitled to super-priority
administrative expense status.

                           DIP Lenders

Michael A. Lubin, the co-chief executive officer of the Debtors,
owns $7,011,000 of the principal amount with respect to the
Debtors' senior subordinated notes.  Mr. Lubin also owns 13%
junior subordinated notes.  In regard to the equity of the
Debtors:

   -- Mr. Lubin and his affiliates hold 1,523,279 common shares
      and owns 78077 warrants to purchase the common stock of the
      Debtors at $3.50 per share;

   -- Mr. Lubin owns an additional 89,062 shares held by Lubin
      Delano & Co. Profit Sharing Trust; and

   -- Lubin Delano owns an additional 3,110 warrants.

Mr. Lubin is a managing member of lender Lubin Partners.

Mr. Conner is a director of the Debtors and owns 364,894 commons
shares with respect to the equity.

ORA Associates is not neither an affiliate of the Debtors nor of
the other DIP lenders.

                     About Lexington Precision

Headquartered in New York, Lexington Precision Corp. --
http://www.lexingtonprecision.com/-- manufacture tight-tolerance
rubber and metal components for use in medical, automotive, and
industrial applications.  As of Feb. 29, 2008, the companies
employed about 651 regular and 22 temporary personel.

The company and its affiliate, Lexington Rubber Group Inc., filed
for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead
Case No.08-11153).  Richard P. Krasnow, Esq., at Weil, Gotshal &
Manges, represents the Debtors in their restructuring efforts.  
The U.S. Trustee for Region 2 has not appointed creditors to serve
on an Official Committee of Unsecured Creditors in these cases.

When the Debtors filed for protection against their creditors,
they listed total assets of $52,730,000 and total debts of
$88,705,000.


LEVITZ FURNITURE: WFNNB Demands Allowance of $1,892,587 Claim
-------------------------------------------------------------
World Financial Network National Bank and Levitz Furniture Inc.,
nka PVLTZ Inc., are parties to a BankCard agreement dated Nov. 8,
2002, under which WFNNB agreed to process the Visa and MasterCard
credit card transactions between the Debtor and its customers.

The types of transactions WFNNB processes for the Debtor include
credit card purchases and deposits and refunds, which facilitates
the transfer of funds between the customer's credit card bank and
the Debtor.  

WFNNB also processes chargebacks for the Debtor, and has the
right to charge back any amounts if the Debtor fails to comply
with the BankCard Agreement or the rules set by the credit card
companies.  Thus, when the Debtor takes prepayments or deposits
on merchandise and fails to deliver the product, the customer is
entitled to a chargeback, and the Debtor is ultimately
responsible for paying the chargeback.  WFNNB is entitled to
collect a fee for processing each chargeback.

On behalf of WFNNB, Philip C. Dublin, Esq., at Akin Gump Strauss
Hauer & Feld LLP, in New York, related that WFNNB is required to
respond to a chargeback within 30 days under the rules of the
credit card companies.  

"In order to conduct the necessary investigation, the Debtor is
required under the BankCard Agreement to provide certain
documentation evidencing transactions to WFNNB," Mr. Dublin says.  
If the Debtor fails to produce the evidence to refute the
customer's chargeback claim, WFNNB must charge back the
transaction or return the funds to the customer's issuing bank,
he added.

WFNNB invoiced the Debtor more than $15,140, for the services it
rendered after the Petition Date.  The Bank also identified:

   (i) about $1,590,447 worth of chargebacks that it processed
       for the Debtor postpetition; and

  (ii) about $287,000 in additional chargebacks that the Debtor
       considers invalid due to lack of supporting evidence and
       alleged customer fraud, among other things.

According to Mr. Dublin, the amount of chargeback requests  
increased substantially as the Debtor's Chapter 11 case  
progressed.  

"For each of the chargebacks, WFNNB requested the appropriate
evidence of the underlying transaction.  The Debtor largely
failed to respond to these requests as well as to general
inquiries by WFNNB, except in a few rare instances where the
consumer provided evidence on behalf of the Debtor," Mr. Dublin
related.

He contended that the Debtor's failure to produce evidence of
transactions is a breach of the BankCard Agreement and makes the
Debtor ultimately liable for those additional chargebacks.

Accordingly, WFNNB asks the U.S. Bankruptcy Court for the Southern
District of New York to allow its administrative claim for
$1,892,587.

                   About Levitz Furniture/PVLTZ

Based in New York City, Levitz Furniture Inc., nka PVLTZ Inc. --
http://www.levitz.com/-- is a specialty retailer of furniture,
bedding and home furnishings in the United States.  It has 76
locations in major metropolitan areas, principally in the
Northeast and on the West Coast of the United States.

Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on
Sept. 5, 1997.  In December 2000, the Court confirmed the Debtors'
Plan and Levitz emerged from chapter 11 on February 2001.  Levitz
Home Furnishings Inc. was created as the new holding company as a
result of the emergence.

Levitz Home Furnishings and 12 affiliates filed for chapter 11
protection on Oct. 11, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
45189).  In their second filing, the Debtors disclosed about
$245 million in total assets and $456 million in total debts.
Nicholas M. Miller, Esq., and Richard H. Engman, Esq., at Jones
Day represented the Debtors.  Jeffrey L. Cohen, Esq., Jay R.
Indyke, Esq., and Cathy Hershcopf, Esq., at Cooley Godward Kronish
LLP served as counsel to the Official Committee of Unsecured
Creditors.  During this period, the Debtors closed around 35
stores in the Northeast, California, Minnesota and Arizona.

PLVTZ Inc., a company created by Prentice Capital Management LP,
and Great American Group purchased substantially all the assets of
Levitz Home Furnishings in December 2005.  Initially, Prentice
owned all of the equity interests in PLVTZ.  On July 6, 2007,
PLVTZ was converted into a Delaware corporation, and Harbinger
Capital Partners Special Situations Fund, LP, Harbinger Capital
Partners Master Fund I, Ltd., and their affiliates became minority
shareholders.  Great American's stake in the acquisition was in
running the going-out-of-business sales for some 27 Levitz units.

PLVTZ, dba Levitz Furniture, continued to face decline in
financial performance since December 2005.  Liquidity issues and
the inability to obtain additional capital prompted PLVTZ to seek
protection under chapter 11 on Nov. 8, 2007 (Bankr. S.D.N.Y. Lead
Case No. 07-13532).  Paul D. Leake, Esq., and Brad B. Erens, Esq.,
at Jones Day represents the Debtors in their restructuring
efforts.  Kurtzman Carson Consultants LLC serves as the Debtors'
claims and noticing agent.  The Debtor's schedules show total
assets of $123,842,190 and total liabilities of $76,421,661.  The
Debtors' exclusive period to file a chapter 11 plan expired on
March 7, 2008.  (Levitz Bankruptcy News, Issue No. 39; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


LINENS N THINGS: Gets Interim OK to Tap $700-Mil. GECC DIP Loan
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware allowed
Linens Holding Co., its operating subsidiary Linens 'N Things
Inc., and their debtor-affiliates, in the interim, to request
extensions of credit up to an aggregate outstanding principal of
$700,000,000 at any one time outstanding, including a sub-limit
for letter of credit up to $400,000,000 under a DIP credit
facility with General Electric Capital Corporation and other
lenders.

The DIP Credit Facility consists of a senior revolving credit
facility in a committed amount of up to $700,000,000.  The
Revolver will have a $400,000,000 sublimit for letters of credit
and a sublimit for swingline loans, and a Canadian subfacility of
up to $50,000,000.

The Court will convene a hearing to consider final approval of
the DIP Credit Facility on May 27, 2008, at 2:00 p.m.  Deadline
for objections on the Debtors' proposed Final Order is on May 19.

Proposed counsel for the Debtors, Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware, relates
the Debtors and their non-debtor subsidiaries entered into a
prepetition credit agreement with GECC and GE Canada Finance
Holding Company.  The Prepetition Lenders provided loans to the
Linens Companies of up to $700,000,000, which consists of a
$625,000,000 revolving credit facility, and a $75,000,000 Tranche
B commitment.  As of the Petition Date, an aggregate amount of
$430,000,000 was outstanding under the Prepetition Credit
Facility.

Francis M. Rowan, the Debtors' chief financial officer, told the
Court that the Debtors' reorganization depends in large part on
restoring vendor, customer and employee confidence, and
maintaining the operation of their business as they restructure.  
He says that the Debtors need to have an immediate need to access
to the DIP Credit Facility, and to use certain prepetition
collateral to, among other things, permit the orderly operation
of their business by securing goods and paying employees,
preserve the going concern value of the bankruptcy estates, fund
their reorganization, and maximizing recoveries for stakeholders.

Mr. Rowan said that given that the Debtors' vendors have been
shipping only on a cash on delivery basis for several weeks
prepetition, access to the DIP Credit Facility and use of cash
collateral on an interim basis is necessary to enable the Debtors
to obtain sufficient merchandise for the upcoming "back-to-
school" sales.  Thus, avoiding immediate and irreparable harm to
the Debtors pending the final hearing on the request, he related.

By their motion, the Debtors also proposed to grant super priority
claim status to the claims of the DIP Lenders under the DIP Credit
Agreement, and grant to GECC, as administrative and collateral
agent for the DIP Lenders, security interests in, and liens upon
certain collateral, subject to carve-out and other priority liens,
as security for the repayment and other obligations arising under
the DIP Credit Agreement.

The Debtors will use the DIP proceeds to refinance obligations
under their Prepetition Credit Facility, working capital and
general corporate purposes, payment of costs of administration of
the cases, and payment of certain prepetition expenses.

The salient terms of the Credit DIP Agreement are:

Borrowers:         Linens Inc., Linens Center and Linens 'n
                    Things Canada Corp.

Guarantors:        Linens Holding Co., and certain of its
                    wholly-owned domestic subsidiaries.  In
                    addition, the Canadian Subfacility will be
                    guaranteed by the Canadian Subsidiaries other
                    than the Canadian Borrower.

Interest Rates:    At either the Alternate Base Rate/Canadian
                    Prime Rate, or the Adjusted LIBOR Rate plus
                    the Applicable Margins.

Applicable Margins:

                    Revolver ABR Rate/                 
                    Canadian Prime Margin              1.75%  

                    Revolver Eurodollar Rate           3.25%

                    Standby L/C Margin                 3.25%

                    Commercial L/C Margin              2.75%

                    Unused Facility Fee Margin         0.375%

Carve-Out:         Carve-out refers to allowed and unpaid
                    professional fees and disbursements incurred
                    by the credit parties and any statutory
                    committee, and all fees required to be paid
                    to the Clerk of the Bankruptcy Court and to
                    the office of the U.S. Trustee, in an
                    aggregate not exceeding $5,000,000.

Canadian Liens:    The Canadian Subfacility will be secured by
                    all assets of the Canadian Subsidiaries only.
DIP Credit
Facility Claims
and Liens:         The DIP Credit Facility and all of the
                    Debtors' obligations under the Facility will
                    be entitled to super priority administrative
                    claim status, and will be secured by properly
                    perfected postpetition security interests and
                    liens on all of the Debtors' assets and
                    estates.

Events of Default: In addition to the usual and customary events
                    of default, the DIP Credit Agreement provides
                    that these will constitute Events of Default:

                    -- the filing of a plan of reorganization or
                       disclosure statement, which GECC, GE
                       Canada and the Required Lenders do not
                       consent.  The Required Lenders are the DIP
                       Lenders having more than 66.67% of the sum
                       of all outstanding loans;

                    -- the termination of the Debtors' exclusive
                       periods;

                    -- the failure of the Debtors to meet any of
                       these deadlines:

                       * 09/14/2008 -- Deadline for filing a
                                       Chapter 11 Plan

                       * 10/14/2008 -- Deadline for Disclosure
                                       Statement approval

                       * 11/18/2008 -- Deadline for soliciting
                                       votes on Plan

                       * 11/28/2008 -- Deadline for entry of a
                                       confirmation order

Remedies on
Event of Default:  In addition to customary remedies, and after
                    giving five business days' notice to the
                    Debtors, official committees and the U.S.
                    Trustee, GECC will have relief from the
                    automatic stay, and may foreclose on the DIP
                    Priority Collateral, collect accounts
                    receivable and apply proceeds to the
                    obligations, occupy the Debtors' premises to
                    complete inventories, fulfill orders and sell
                    inventories, execute going out-of-business
                    sales, or exercise remedies against the DIP
                    Priority Collateral permitted by applicable
                    nonbankruptcy law.

A full-text copy of the DIP Credit Agreement is available for
free at http://bankrupt.com/misc/LNT_DIP_Credit_Agreement.pdf

Clifton, New Jersey-based Linens Holding Co., which does business
through its operating subsidiary Linens 'N Things Inc. --
http://www.lnt.com/-- is the second largest specialty retailer of   
home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of December 29, 2007.  The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name well as private label home furnishings
merchandise in the industry.

Linens 'N Things and 11 affiliates filed separate voluntary
petitions under Chapter 11 of the United States Bankruptcy Code in
the United States Bankruptcy Court for the District of Delaware on
May 2, 2008 (Lead Case No. 08-10832).  The Canadian operations are
not included in the filings.

Linens 'N Things is represented by Richards, Layton & Finger,
P.A., and Morgan, Lewis & Bockius LLP.  Conway, Del Genio, Gries &
Co., LLC will serve as the retailer's restructuring advisor until
substantial consummation of a chapter 11 plan.  Conway Del Genio's
Michael F. Gries acts as the Debtors' chief restructuring officer
and interim CEO.  Kurtzman Carson Consultants LLC acts as the
Debtors' claims agent.

A Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.


LINENS 'N THINGS: Bankruptcy Filing Cues Fitch's Default Rating
---------------------------------------------------------------
Fitch Ratings has downgraded its Issuer Default Rating on Linens
'n Things, Inc. to 'D' from 'C' and reaffirmed the ratings on
Linens existing asset-backed revolver at 'CC/RR3' and the senior
secured notes at 'C/RR5'.  The Negative Rating Watch has been
removed.  Fitch expects to withdraw its ratings on Linens within
thirty days.

Fitch's action follows Linens' Chapter 11 filing for the company
and its U.S. subsidiaries and excludes its Canadian operations.   
Linens has secured $700 million in debtor-in-possession financing
from General Electric Capital Corp.  Linens has also announced
plans to close 120 of its 589 stores.


LINENS 'N THINGS: Bankruptcy Filing Cues Moody's Default Rating
---------------------------------------------------------------
Moody's Investors Service downgraded Linens 'N Things, Inc.'s
ratings, probability of default rating to D and confirmed all
other existing long term ratings.  The downgrade of Linens' PDR is
prompted by Linens' N Things voluntary filing of Chapter 11 on
May 2, 2008.

This rating is downgraded:

  -- Probability of default rating to D from Ca.

These ratings are confirmed:

  -- Corporate family rating at Ca;
  -- $650 Million of senior secured guaranteed notes due 2014 at
     Ca (LGD4, 61%).

  -- The Speculative Grade Liquidity Rating remains a SGL-4.

As a result of the bankruptcy filing, Moody's will withdraw all
the ratings on Linens 'N Things in the near future.

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 Dec. 29, 2007 were approximately
$2.8 billion.


LINENS 'N THINGS: S&P Withdraws Default Rating
----------------------------------------------
Standard & Poor's Ratings Services withdrew its 'D' ratings on
Clifton, New Jersey-based Linens 'n Things Inc. and its '6'
recovery rating on the company's senior secured floating-rate
notes.  Subsequent to the company's Chapter 11 filing, S&P
determined that they would not have access to sufficient
information to continue surveillance on the company's recovery
ratings.


MAGELLAN HEALTH: S&P Holds Ratings; Revises Outlook to Positive
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Magellan
Health Services Inc. to positive from stable.  At the same time,
Standard & Poor's said it has affirmed its 'BB' counterparty
credit rating on Magellan and withdrawn its 'BBB-' debt rating
assigned to Magellan's $150 million credit facility due August
2008.
     
"The revised outlook reflects Magellan's strengthening balance
sheet fundamentals and improving business profile diversity," said
Standard & Poor's credit analyst Joseph Marinucci.
     
Over the past few years, Magellan has materially reduced debt
outstanding, strengthened its liquidity position, and
significantly enhanced its tangible net equity position.  In
addition, the company's acquired lines are beginning to contribute
more meaningfully to cash flow generation.
     
The rating affirmation reflects the company's established
competitive position, improving cash flow diversity, and good
liquidity and financial flexibility.  The rating is constrained by
qualitative business profile considerations related to changing
competitive and product dynamics and uncertainties about
Magellan's prospects for sustained growth into new and compatible
markets through acquisition.  In addition, the company remains
exposed to client concentration risk.
     
"Standard & Poor's might raise the rating by one notch if Magellan
continues to perform in accordance with our expectations for 2008
and adequately manages growth from a risk perspective," said
Mr. Marinucci.  "Conversely, we might revise the outlook back to
stable or negative if cash flow and earnings erode or if the
company were to make an acquisition that significantly altered its
capital structure.

"The timeliness and effectiveness of the process related to the
hiring of a new CFO could also affect our position on the outlook
and the potential for an upgrade," Mr. Marinucci added.


MARATHON STRUCTURED: Fitch Chips Rating to BB on Class A-1 Notes
----------------------------------------------------------------
Fitch downgraded one class of notes issued by Marathon Structured
Funding I, LLC, and withdraws the class A-2 notes.  These rating
action is effective immediately:

  -- $131,288,059 class A-1 notes downgraded to 'BB' from 'AAA'
     and remain on Rating Watch Negative;

Marathon Structured Funding is a collateralized debt obligation
that closed on March 22, 2005 and is managed by Marathon Asset
Management, LLC. Marathon Structured Funding ended its
reinvestment period in January 2008.  Marathon Structured funding
has a portfolio comprised primarily of subprime residential
mortgage-backed securities bonds (67.5%), structured finance
(6.7%), and non-SF CDOs (18.2%) and other structured finance
assets.  Subprime RMBS bonds of the 2005, 2006, and 2007 vintages
account for approximately 16.0%, 18.2%, and 23.5% of the
portfolio, respectively.  Likewise, the SF CDO exposure includes
SF CDO originated in 2005 (5.2%) and 2006 (1.5%).

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS and
SF CDOs with underlying exposure to subprime RMBS.  Since the
beginning of 2007, approximately 57.1% of the portfolio has been
downgraded with 10.6% of the portfolio currently on Rating Watch
Negative.  The negative credit migration is primarily attributable
to credit deterioration in subprime RMBS bonds from the 2005, 2006
and 2007 vintages, coupled with significant downgrades in SF CDOs
originated between 2005 and 2007.  Approximately 48.4% of the
portfolio is below investment grade of which 39.4% is rated CCC
and below.

The class A-2 notes were issued a credit rating with a $0 balance
in expectation of future issuance, no class A-2 notes were ever
issued and the ability to issue class A-2 in the future no longer
exists.  Because the class A-2 notes will not be issued, Fitch has
withdrawn the rating.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS.  Additionally, Fitch is reviewing its
SF CDO approach and will comment separately on any changes and
potential rating impact at a later date.

The rating of the class A-1 notes addresses the likelihood that
investors will receive full and timely payments of interest, as
per the transaction's governing documents, as well as the stated
balance of principal by the legal final maturity date.


MERCK & CO: To Reduce U.S. Sales Force by 1,200 Positions
---------------------------------------------------------
Merck & Co., Inc. plans to reduce the size of its U.S. sales force
by 1,200 positions.

In February 2008, the company disclosed that as part of
implementing the new commercial model, the company is
re-engineering its core business to be more efficient with the
goal of reducing aspects of its cost base and realizing gross
margin improvement.  The reengineering includes the implementation
of manufacturing and marketing cost savings initiatives.  The
initial phase of the global restructuring program announced in
2005 was designed to reduce the company’s cost structure, increase
efficiency and enhance competitiveness.

The scope of this initial phase included the implementation of a
new supply strategy by the Merck Manufacturing Division over a
three-year period, focusing on establishing lean supply chains,
leveraging low-cost external manufacturing and consolidating the
company's manufacturing plant network.

As part of this program, through January 2008, Merck had closed,
sold or ceased operations at five manufacturing sites and two
preclinical sites and eliminated approximately 7,200 positions
company-wide (comprised of actual headcount reductions and the
elimination of contractors and vacant positions).  The company,
however, continues to hire new employees as the business requires.

As of March 2008, the company has 59,800 employees worldwide.

"Merck is taking this step as part of our previously disclosed,
continuing efforts to optimize our cost base and improve Merck's
effectiveness and efficiency across all aspects of our business as
part of our Plan to Win strategy," Kenneth Frazier, president,
Global Human Health, said.  "With eight successful launches of
Merck products approved in the U.S. since 2006 now behind us, and
with an unexpected delay in a new product approval, we decided to
accelerate the achievement of efficiencies we anticipate gaining
as we transition to our new commercial model in the U.S."

The company does not anticipate any disruption in its service to
customers as these changes occur.

Affected employees, who are located throughout the U.S., will be
notified by the end of May; separations will be completed by the
end of July.  As Merck takes this difficult but necessary action,
the Company is committed to treating employees with fairness and
respect.  Eligible employees will receive benefits and other
services to assist them.

The pretax costs of this restructuring program since inception
through the end of 2007 were $2.1 billion, of which approximately
70% are non-cash, relating primarily to accelerated depreciation
for those facilities scheduled for closure and approximately 30%
represent separation and other restructuring related costs.  These
costs were $810.1 million in 2007 and are expected to be
approximately $100 million to $300 million in 2008, at which time
the initial phase of the restructuring program relating to the
manufacturing strategy is expected to be substantially complete.

Merck continues to expect the initial phase of its cost reduction
program, combined with cost savings the company expects to achieve
in its marketing and administrative and research and development
expenses, will yield cumulative pretax savings of $4.5 to $5.0
billion from 2006 through 2010.

                         VIOXX Litigation

Individual and putative class actions have been filed against the
company in federal and state courts alleging personal injury and
economic loss with respect to the purchase or use of VIOXX.  A
number of these actions are coordinated in a multidistrict
litigation in the U.S. District Court for the Eastern District of
Louisiana, and in separate coordinated proceedings in state courts
in the states of New Jersey, California and Texas and in the
counties of Philadelphia, Pennsylvania; Washoe County, Nevada; and
Clark County, Nevada.

As of March 31, 2008, the company had been served or was aware
that it had been named as a defendant in approximately 14,450
lawsuits, which include approximately 32,925 plaintiff groups
alleging personal injuries resulting from the use of VIOXX, and in
approximately 260 putative class actions alleging personal
injuries or economic loss.

Of these lawsuits, approximately 9,200 lawsuits representing
approximately 24,325 plaintiff groups are or are slated to be in
the federal MDL, and approximately 3,350 lawsuits representing
approximately 3,350 plaintiff groups are included in a coordinated
proceeding in New Jersey Superior Court.  In addition, as of March
31, 2008, approximately 12,760 claimants had entered into Tolling
Agreements with the company, which halt the running of applicable
statutes of limitations for those claimants who seek to toll
claims alleging injuries resulting from a thrombotic
cardiovascular event that results in a myocardial infarction or
ischemic stroke.  Information regarding scheduled product
liability trials in 2008 can be found at
http://www.merck.com/newsroom/vioxx/

                         About Merck & Co.

Based in Whitehouse Station, New Jersey, Merck & Co., Inc. --
http://www.merck.com/-- is a global research-driven  
pharmaceutical company dedicated to putting patients first.  
Established in 1891, Merck discovers, develops, manufactures and
markets vaccines and medicines to address unmet medical needs.  
The company devotes extensive efforts to increase access to
medicines through far-reaching programs that not only donate Merck
medicines but help deliver them to the people who need them.  
Merck also publishes unbiased health information as a not-for-
profit service.


MERRILL LYNCH: Fitch Chips Ratings on $121.3MM Certificates
-----------------------------------------------------------
Fitch Ratings has taken rating actions on eight 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
$390 million and downgrades total $121.3 million.  Additionally,
$2.6 million was placed on Rating Watch Negative.

Series 2003-HE1
  -- $6.0 million class A-1 affirmed at 'AAA';
  -- $8.5 million class A2-B affirmed at 'AAA';
  -- $13.1 million class M-1 affirmed at 'AA';
  -- $3.4 million class M-2 affirmed at 'A+';
  -- $1.2 million class M-3 downgraded to 'BBB+' from 'A';
  -- $0.8 million class B-1 downgraded to 'BBB' from 'A-';
  -- $0.8 million class B-2 downgraded to 'B' from 'BB+';
  -- $0.8 million class B-3 downgraded to 'CC/DR3' from 'B'.

Deal Summary
  -- Originators: 86% Provident & 14% Novelle;
  -- 60+ day Delinquency: 17.78%;
  -- Realized Losses to date (% of Original Balance): 1.77%.

Series 2003-OPT1
  -- $48.9 million class A-1 affirmed at 'AAA';
  -- $7.6 million class A-2 affirmed at 'AAA';
  -- $6.5 million class A-3 affirmed at 'AAA';
  -- $52.6 million class M-1 affirmed at 'AAA';
  -- $12.8 million class M-2 affirmed at 'A+';
  -- $2.9 million class M-3 downgraded to 'A-' from 'A';
  -- $3.0 million class B-1 downgraded to 'BBB' from 'A-';
  -- $3.3 million class B-2 downgraded to 'BB' from 'BB+';
  -- $2.2 million class B-3 affirmed at 'B'.

Deal Summary
  -- Originators: 100% Option One Mortgage Corp.;
  -- 60+ day Delinquency: 16.46%;
  -- Realized Losses to date (% of Original Balance): 0.84%.

Series 2003-WMC1
  -- $12.0 million class M-2 affirmed at 'AA-';
  -- $16.8 million class B-1 revised to 'CCC/DR2' from 'CCC/DR1';
  -- $0.7 million class B-2 revised to 'C/DR6' from 'C/DR5'.

Deal Summary
  -- Originators: 100% WMC Mortgage Corp.;
  -- 60+ day Delinquency: 26.67%;
  -- Realized Losses to date (% of Original Balance): 1.84%.

Series 2003-WMC2
  -- $20.1 million class M-2 affirmed at 'AA-';
  -- $16.8 million class B-1 downgraded to 'B' from 'BBB+';
  -- $1.8 million class B-2 downgraded to 'C/DR5' from 'BB+'.

Deal Summary
  -- Originators: 100% WMC Mortgage Corp.;
  -- 60+ day Delinquency: 20.68%;
  -- Realized Losses to date (% of Original Balance): 1.30%.

Series 2003-WMC3
  -- $25.2 million class M-3 affirmed at 'A+';
  -- $15.7 million class M-4 downgraded to 'A-' from 'A';
  -- $5.1 million class B-1 downgraded to 'BB' from 'BBB+';
  -- $0.5 million class B-2 downgraded to 'B+' from 'BB';
  -- $0.8 million class B-3 downgraded to 'B' from 'BB-'.

Deal Summary
  -- Originators: 100% WMC Mortgage Corp.;
  -- 60+ day Delinquency: 20.01%;
  -- Realized Losses to date (% of Original Balance): 1.39%.

Series 2004-HE1
  -- $3.9 million class M-1 affirmed at 'AA';
  -- $10.7 million class M-2 downgraded to 'BBB+' from 'A';
  -- $3.8 million class B-1 downgraded to 'BB+' from 'BBB+';
  -- $3.5 million class B-2 downgraded to 'CCC/DR1' from 'BBB';
  -- $0.6 million class B-3 downgraded to 'C/DR5' from 'B'.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 21.53%;
  -- Realized Losses to date (% of Original Balance): 1.27%.

Series 2004-HE2
  -- $7.7 million class A-1A affirmed at 'AAA';
  -- $0.5 million class A-1B affirmed at 'AAA';
  -- $8.2 million class A-2C affirmed at 'AAA';
  -- $0.0 million class R affirmed at 'AAA';
  -- $35.8 million class M-1 affirmed at 'AA';
  -- $21.7 million class M-2 affirmed at 'A';
  -- $7.7 million class M-3 affirmed at 'A-';
  -- $7.7 million class B-1 affirmed at 'BBB+';
  -- $6.2 million class B-2 affirmed at 'BBB';
  -- $2.6 million class B-3 rated 'BBB-', placed on Rating Watch
     Negative.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 14.42%;
  -- Realized Losses to date (% of Original Balance): 1.79%.

Series 2004-OPT1
  -- $48.8 million class A-1A affirmed at 'AAA';
  -- $2.6 million class A-1B affirmed at 'AAA';
  -- $19.3 million class A-2A affirmed at 'AAA';
  -- $1.3 million class A-2B affirmed at 'AAA';
  -- $0.0 million class R affirmed at 'AAA';
  -- $31.0 million class M-1 downgraded to 'A' from 'AA';
  -- $15.1 million class M-2 downgraded to 'BBB' from 'A';
  -- $1.2 million class M-3 downgraded to 'BBB-' from 'A-';
  -- $1.2 million class B-1 downgraded to 'BB+' from 'BBB+';
  -- $0.7 million class B-2 downgraded to 'BB' from 'BBB'.

Deal Summary
  -- Originators: 100% Option One Mortgage Corp.;
  -- 60+ day Delinquency: 18.14%;
  -- Realized Losses to date (% of Original Balance): 0.51%.


MERRILL LYNCH: Fitch Takes Rating Actions on Various Cert. Classes
------------------------------------------------------------------
Fitch Ratings has taken rating actions on these Merrill Lynch
Mortgage Investors Merrill Lynch Credit Corp. mortgage pass-
through certificates:

Series 2003-C
  -- Class A affirmed at 'AAA';
  -- Class B-1 affirmed at 'AAA';
  -- Class B-2 affirmed at 'AA+';
  -- Class B-3 affirmed at 'A+';
  -- Class B-4 downgraded to 'BB' from 'BBB+';
  -- Class B-5 downgraded to 'CC/DR3' from 'BB+'.

Series 2004-G
  -- Class A affirmed at 'AAA';
  -- Class B-1 affirmed at 'AA';
  -- Class B-2 affirmed at 'A+';
  -- Class B-3 downgraded to 'B' from 'BBB';
  -- Class B-4 downgraded to 'CC/DR4' from 'BB+';
  -- Class B-5 downgraded to 'C/DR6' from 'B+'.

The affirmations, affecting approximately $194.9 million of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss.  The downgrades, affecting
approximately $4.1 million of the outstanding certificates, are
taken as a result of a deteriorating relationship between credit
enhancement and expected loss.

The negative rating actions on the transactions are because of
current trends in the relationship between serious delinquency and
credit enhancement.  The 90+ DQ for series 2003-C is 2.30% and
series 2004-G is 8.50% of the current collateral balance.

The collateral of the transactions consists of conventional,
adjustable-rate, fully amortizing mortgage loans extended to prime
borrowers and secured by first liens on one- to four-family
residential properties.  The loans were originated or acquired by
Merrill Lynch Credit Corp. and are serviced by PHH Mortgage Corp.,
which is rated 'RPS1-' by Fitch.

As of the March 2008 remittance date, the pool factor of series
2003-C is 13% and series 2004-G is 15%.  Series 2003-C is seasoned
57 months and series 2004-G is seasoned 39 months.


MERRILL LYNCH: Fitch Affirm 'BB' Rating on Class B-2 Certificates
-----------------------------------------------------------------
Fitch Ratings affirmed Merrill Lynch Bank USA mortgage pass-
through certificates as:

Series 2001-A
  -- Class A at 'AAA';
  -- Class M-1 at 'AA+';
  -- Class M-2 at 'AA-';
  -- Class B-1 at 'BBB';
  -- Class B-2 at 'BB'.

The affirmations, affecting approximately $87.8 million of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss.

The collateral of the transaction consists of high balance,
adjustable rate mortgage loans extended to prime borrowers and
secured by first liens on one- to four-family residential
properties.  The loans were originated or acquired by Merrill
Lynch Credit Corp. and are serviced by PHH Mortgage Corp., which
is rated 'RPS1-' by Fitch.

As of the March 2008 remittance date, series 2001-A has a pool
factor of 14% and is seasoned 84 months.


NAE OF KENDALL: Case Summary & Six Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: NAE of Kendall, LLC
        14040 S.W. 139 Ct.
        Miami, FL 33186

Bankruptcy Case No.: 08-15354

Chapter 11 Petition Date: April 29, 2008

Court: Southern District of Florida (Miami)

Judge: 08-15354

Debtor's Counsel: Mariaelena Guitian, Esq.
                  Email: mguitian@gjb-law.com
                  Genovese Joblove & Battista
                  200 E. Broward Blvd., Ste. 1110
                  Ft. Lauderdale, FL 33301
                  Tel: (954) 453-8000
                  Fax: (954) 453-8010
                  http://www.gjb-law.com/

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's Six Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Bayview Loan Servicing LLC     14040 S.W. 139 Ct.    $1,714,021
4425 Ponce de Leon, 5th Flr.   Miami, FL 33186
Coral Gables, FL 33146

Tamiami Pointe, Ltd.           14040 S.W. 139 Ct.    $210,000
1637 N.W. 27 Ave. 200          Miami, FL 33186;
Miami, FL 33125                value of senior lien:
                               $3,558,042

Jose M. De La O, Esq.          attorney's fees       $5,000
75 Valencia Ave. Flr. 4
Miami, FL 33134

Carlos Ziegenhirt, Esq.        attorney's fees       $2,500

CitiCard Visa-CitiBusiness     credit card           $2,072

Waste Management               garbage pick-up       $2,026


NIELSEN CO: S&P Revises Outlook on 'B' Rating to Stable from Neg.
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on the 'B'
corporate credit rating of The Nielsen Co. B.V. to stable from
negative.
     
"The outlook change reflects the company's good operating
performance and progress in its cost-cutting initiatives," said
Standard & Poor's credit analyst Tulip Lim.  "However, Nielsen's
discretionary cash flow remains weak, prolonging its highly
leveraged status."
     
The ratings on the New York City-based Nielsen reflect the
company's highly leveraged capital structure, track record of
frequent acquisitions that have deferred deleveraging, the
continuing investment required to remain competitive in the
evolving marketing information industry, and ongoing customer
pressure on prices and service levels that underpin the need for
an efficient cost base.  Nielsen's satisfactory business risk
profile, which reflects its strong market positions in media
measurement and retail marketing information, and significant
recurring revenues partially offset these factors.
     
Operating in more than 100 countries, Nielsen is one of the
world's leading providers of marketing, media, and business
information.  Marketing information and media measurement have a
high proportion of sales contracted in advance and strong renewal
rates, which mean that cash flows are relatively predictable.
     
Nielsen aims to deleverage its balance sheet largely through
EBITDA growth resulting from cost savings.  Management's progress
depends on several factors, some of which are not within its
control.  In particular, S&P expect that most of the cost savings
will originate in the marketing information division, which is
more exposed to competition.  Nielsen's acquisition of IAG
Research Inc. last month, its August 2007 acquisition of U.S.
telecom research provider Telephia Inc., and the June 2007 buyout
of minority investors in Nielsen/NetRatings Inc. were marginally
negative to Nielsen's near-term liquidity and at price tags that
reinforce high leverage.  

Also, funding of the cost-cutting program and pension-plan
contributions will consume cash for the next few years.  As a
result, S&P expect debt reduction will be very limited, with any
improvement in credit measures coming from EBITDA growth.


NEXTEL CORP: S&P Lowers Ratings to 'BB' on Five Transactions
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on five
Sprint Nextel Corp. - related transactions and removed them from
CreditWatch with negative implications.
     
The rating actions reflect the May 1, 2008, lowering of the
ratings on the underlying securities, the 6.875% notes due
Nov. 15, 2028, and the 8.75% notes due March 15, 2032, issued by
Sprint Capital Corp. (a subsidiary of Sprint Nextel Corp.) and
their removal from CreditWatch with negative implications.
     
STRATS Trust for Sprint Capital Corp. Securities Series 2004-2,
Corporate Backed Trust Certificates Sprint Capital Note-Backed
Series 2003-17, COBALTS Trust for Sprint Capital Notes' series
2002-1, and PPLUS Trust Series SPR-1 are pass-through
transactions.  The ratings on the certificates issued by the
trusts for those transactions are based solely on the rating
assigned to the underlying securities, the 6.875% notes due
Nov. 15, 2028, issued by Sprint Capital Corp.
     
SATURNS Sprint Capital Corp. Debenture Backed Series 2003-2 is a
pass-through transaction, and the rating on the callable units
issued by the trust is based solely on the rating assigned to the
underlying securities, the 8.75% notes due March 15, 2032, issued
by Sprint Capital Corp.

       Ratings Lowered and Removed from Creditwatch Negative
    
             COBALTS Trust for Sprint Capital Notes
$25 million corporate-backed listed trust securities trust series
           Sprint Capital certificates, series 2002-1

                                   Rating
                                   ------
               Class        To                 From
               -----        --                 ----
               Certs        BB                 BBB-/Watch Neg

   Corporate Backed Trust Certificates Sprint Capital
Note-Backed                     
                           Series 2003-17
       $25 million Sprint Capital note-backed series 2003-17

                                     Rating
                                     ------
                Class        To                 From
                -----        --                 ----
                A-1          BB                 BBB-/Watch Neg

                      PPLUS Trust Series SPR-1
            $42 million trust certificates series SPR-1

                                    Rating
                                    ------
                Class        To                 From
                -----        --                 ----
                Cert         BB                 BBB-/Watch Neg     

                      SATURNS Trust No. 2003-2
             $30 million callable units series 2003-2

                                    Rating
                                    ------
                Class        To                 From
                -----        --                 ----
                A            BB                 BBB-/Watch Neg
                B            BB                 BBB-/Watch Neg

    Structured Repackaged Asset Backed Trust Securities (STRATS)
                    Certificates Series 2004-2
              $38 million certificates series 2004-2

                                   Rating
                                   ------
               Class        To                 From
               -----        --                 ----
               A-1          BB                 BBB-/Watch Neg


NORTH SHORE: Case Summary & Nine Largest Unsecured Creditors
------------------------------------------------------------
Debtor: North Shore LLP
        dba Highland Lakes Country Club
        20552 Lake Highlands Blvd.
        Lago Vista, Tx 78645

Bankruptcy Case No.: 08-10770

Type of Business: The Debtor owns and manages a golf course.

Chapter 11 Petition Date: April 28, 2008

Court: Western District of Texas (Austin)

Judge: Frank R. Monroe

Debtor's Counsel: Eric A. Liepins, Esq.
                  12770 Coit Rd., Ste. 1100
                  Dallas, TX 75251
                  Tel: (972) 991-5591
                  Fax: (972) 991-5788
                  Email: eric@ealpc.com

Total Assets: $1,753,000

Total Debts:    $736,028

Debtor's Nine Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Montegra Capital Resources     first lien holder on  $500,000
730 17th St. Ste. 690          property
Denver, CO 80202

C&M Air Cooled Engine, Inc.                          $39,675
6612 W. Highway 84
Woodway, TX 76712

Professional Turf Products                           $16,638
1010 N. Industrial Blvd.,
Euless, TX 76039

Comptroller                                          $13,106

Floor King, Inc.                                     $6,348

Perdanales Electric                                  $4,186

Thomas Petroleum LLC                                 $850

Logix Communications                                 $725

IESI                                                 $500


NORTHWEST AIRLINES: Posts $4.1 Billion First Qtr. 2008 Net Loss
---------------------------------------------------------------
Northwest Airlines Corporation reported a first quarter 2008 net
loss of $4.1 billion, or $15.78 per share.  Reported results
include a non-cash goodwill impairment charge of $3.9 billion.  
This compares to the first quarter 2007 when Northwest reported a
net loss of $292 million.

Excluding non-recurring, non-cash impairment charges and losses
associated with marking-to-market out-of-period fuel hedges,
Northwest reported a first quarter 2008 net loss of $191 million
versus the first quarter 2007 when the airline reported net income
of $73 million before the impact of reorganization items and out-
of-period fuel hedge gains.

Excluding taxes and out-of-period mark-to-market adjustments on
fuel hedges, Northwest paid $2.77 per gallon for jet fuel in the
first quarter compared to $1.85 a gallon in the first quarter
of 2007, an increase of 49.7 percent.

On April 14, Northwest announced an agreement to merge with Delta.  
Commenting on the transaction, Doug Steenland, Northwest Airlines'
president and chief executive officer, said, "The agreement to
merge with Delta creates America's premier global airline.  
Because it combines end-to-end networks with little overlap, there
will be no reduction in competition.  The transaction will create
America's leading airline -- an airline that is more financially
secure, better able to invest in our employees and our customers
and be sustainable in an increasingly competitive marketplace.  
The new carrier will offer superior route diversity across the
U.S., Latin America, Europe and Asia and will be better able to
overcome the industry's boom-and-bust cycles.  The airline will
also be better able to match the right planes with the right
routes, making transportation more efficient across our entire
network."

In commenting on first quarter results, Mr. Steenland added,
"Northwest's first quarter performance was negatively impacted by
the dramatic increases in the price of oil.  Year-over-year our
first quarter total fuel expense increased by $445 million, or
57.3 percent.  The sustained high fuel prices represent an
extraordinary challenge to Northwest and the entire airline
industry.  In response to fuel, we have taken a series of actions
and will continue to monitor the impacts of fuel prices on our
operation and are prepared to take additional actions as
necessary."

              $3.9 Billion Non-cash, Non-recurring
            Accounting Charge Taken to Reduce Goodwill

The company is required for accounting purposes to measure
the value of goodwill annually or whenever significant events
that could be indicators of a change in value have occurred.  In
completing the company's first quarter evaluation, NWA considered
the impact of current high fuel prices, Northwest's recent stock
price, other industry trends and the equity value of Northwest
implied by the recent merger announcement and have determined that
an impairment to goodwill is required.  To make this etermination,
the company compared the carrying value of its equity to its fair
value.  For purposes of this evaluation, fair value has been
determined based on the implied market value of Northwest's equity
in the announced transaction.  As a result of this evaluation, the
company recorded a non-cash goodwill impairment charge of $3.9
billion.

                     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. 92;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on April 17, 2008,
Moody's Investors Service placed the debt ratings of Delta Air
Lines, Inc. ("Delta", corporate family at B2) and Northwest
Airlines Corporation ("Northwest", corporate family rating at B1)
on review for possible downgrade.  The review was prompted by the
announcement that the two airlines have agreed to combine in an
all-stock transaction with a combined enterprise value of
approximately $18 billion.

Fitch Ratings has affirmed the debt ratings of Delta Air Lines,
Inc. following the announcement that Delta has agreed to merge
with Northwest Airlines Corp., subject to approval by the two
airlines' shareholders and the U.S. Department of Justice.  
Delta's ratings were affirmed as: Issuer Default Rating at 'B';
First-lien senior secured credit facilities at 'BB/RR1'; Second-
lien secured credit facility (Term Loan B) at 'B/RR4'.

The issue ratings apply to $2.5 billion of committed credit
facilities.  The Rating Outlook for Delta has been revised to
Negative from Stable.

Standard & Poor's Ratings Services placed its ratings, including
the 'B+' long-term corporate credit rating, on Northwest Airlines
Corp. on CreditWatch with negative implications, following
announcement of a merger agreement with Delta Air Lines Inc.
(B/Watch Pos/--).  The CreditWatch listing affects enhanced
equipment trust certificates with various ratings, excepting those
that are insured by a bond insurer.  S&P's listing of Northwest
ratings on CreditWatch with negative implications and those of
Delta on CreditWatch with positive implications implies that S&P
foresee a corporate credit rating of either 'B' or 'B+' for the
combined entity.


NORTHWEST AIRLINES: Merger with Delta to Result in 1,000 Cut Jobs
-----------------------------------------------------------------
In a testimony before Congress, Delta Air Lines, Inc. Chief
Executive Officer Richard Anderson disclosed that a merger with
Northwest Airlines, Inc., will mean the loss of a "guess-timate"
of 1,000 additional jobs, the Atlanta-Journal Constitution
reports.

According to Mr. Anderson, the job losses would come after the
deal closes, and would be concentrated on "the management jobs,
not the front-line jobs" that would involve "finance, accounting
-- the functions that are important in the headquarters."  The
layoff is part of an effort to save on costs to offset
skyrocketing fuel prices, Mr. Anderson told the Committees in the
House and the Senate.

Mr. Anderson will be chief executive officer of the merged
airline.  Delta and Northwest have recently launched their
campaign in Washington, D.C., by testifying before Senate and
Congress hearings.  

Majority of the lawmakers "appeared friendly" of the proposed
consolidation, finding, among other things, that there is "very
little overlap" in the carriers' routes, and agreeing that "fuel
costs really are a game-changer."

Prior to the hearings, Mr. Anderson told The Associated Press
that regardless of the merger, Delta and Northwest will continue
to adjust capacity to demand as fuel prices continue at current
levels.  "That's the rational thing to do, and we'll continue to
do that," he maintained.

After the hearing, Delta spokeswoman Chris Kelly told AJC that
because the consolidated company would be based in Atlanta, more
of the job cuts may be from Northwest because they may not want
to make the move to Georgia.

In the coming months, the two airlines will face additional
hearings.  Regulators and shareholders will reveal whether they
approve the combination, the AP says.

           NWA's CEO Stands to Get $22.1MM After Merger

Northwest CEO Doug Steenland, according to Business Week of
Minnesota, will get about $22.1 million when he resigns after the
Delta merger.  Business Week adds that in 2007, Mr. Steenland
pooled $27 million, including $6 million in stock options
following Northwest's bankruptcy exit.  The report comments that
the stock option is "currently worthless" since the exercise price
of $22 per share is twice the company's current share price.

Minnesota's Star Tribune reports that Northwest intends to retain
Mr. Steenland after the merger and wooes the executive with $3.6
million in stock options.  Based on Star Tribune, Mr. Steenland
waived his option to resign last June and get $3.2 million in
severance pay.  The executive in turn opted a 375,000 "restricted
retention units" as a stock-based compensation, Star Tribune says.

       Delta Pilots Open to Arbiter, Union Chairman Says

Lee Moak, the head of executive committee of Delta's pilots
union, suggested that he is open to arbitration with Northwest
pilots over how to merge their seniority lists, the AP says.

In a letter addressed to fellow pilots, Mr. Moak said that union
leaders believe that seniority integration should be accomplished
after negotiation of a single joint contract and, if necessary,
"expedited arbitration [should] be completed before closing of a
corporate transaction."

Mr. Moak related that while Delta and Northwest pilots failed to
reach an overall agreement on pilot seniority integration, the
Delta pilots union determined "an alternative that would provide
for a superior outcome not only for the pre-merger Delta pilots,
but eventually for all pilots of the merged corporation."

As a result, a tentative agreement between Delta management and
the Delta pilots union was formed, which will provide certain
modifications to the current Pilot Working Agreement, that
include, among others, a three and one-half percent equity stake
in the merged Company, annual pay raises, "furlough protection,"
and an increase in 737-700 pay rates, the letter said.

Rank-and-file Delta pilots will soon be asked to vote on the
proposed Agreement.

The Agreement does not cover Northwest pilots, whose union has
stated it supports arbitration.  The statement, however, was said
before Delta's pilots cut a deal with management days before the
merger announcement, says the AP.

Mr. Moak disclosed that Delta's pilots union welcomes the idea of
partnering with the Northwest pilots "to bring about the rapid
completion of a new joint contract and a fair and equitable
integrated seniority list upon the effective date of the . . .
Agreement."

A full-text copy of Mr. Moak's letter is available for free at:

   http://crewroom.alpa.org/dal/DesktopDefault.aspx?tabid=2421

                          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, Issue No. 96; 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 $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. 91;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on April 17, 2008,
Moody's Investors Service placed the debt ratings of Delta Air
Lines, Inc. ("Delta", corporate family at B2) and Northwest
Airlines Corporation ("Northwest", corporate family rating at B1)
on review for possible downgrade.  The review was prompted by the
announcement that the two airlines have agreed to combine in an
all-stock transaction with a combined enterprise value of
approximately $18 billion.

Fitch Ratings has affirmed the debt ratings of Delta Air Lines,
Inc. following the announcement that Delta has agreed to merge
with Northwest Airlines Corp., subject to approval by the two
airlines' shareholders and the U.S. Department of Justice.  
Delta's ratings were affirmed as: Issuer Default Rating at 'B';
First-lien senior secured credit facilities at 'BB/RR1'; Second-
lien secured credit facility (Term Loan B) at 'B/RR4'.

The issue ratings apply to $2.5 billion of committed credit
facilities.  The Rating Outlook for Delta has been revised to
Negative from Stable.

Standard & Poor's Ratings Services placed its ratings, including
the 'B+' long-term corporate credit rating, on Northwest Airlines
Corp. on CreditWatch with negative implications, following
announcement of a merger agreement with Delta Air Lines Inc.
(B/Watch Pos/--).  The CreditWatch listing affects enhanced
equipment trust certificates with various ratings, excepting those
that are insured by a bond insurer.  S&P's listing of Northwest
ratings on CreditWatch with negative implications and those of
Delta on CreditWatch with positive implications implies that S&P
foresee a corporate credit rating of either 'B' or 'B+' for the
combined entity.


OFFICEMAX INC: Net Income Rises to $63MM in Quarter Ended March 29
------------------------------------------------------------------
OfficeMax(R) Incorporated reported net income of $63.3 million in
the first quarter ended March 29, 2008, an increase from
$58.5 million in the first quarter of 2007.  

Results for the first quarter of 2008 and 2007 included items that
are not considered indicative of core operating activities or
unusual items.

Results for the first quarter of 2008 included three unusual items
which, if excluded, would reduce income before taxes by
$16.3 million and included a benefit of $20.5 million recorded as
other income related to the company's investment in Boise Cascade
L.L.C.

The result was partly offset by an expense of $2.4 million
recorded in the Contract segment related to the consolidation of
manufacturing facilities in New Zealand, and an expense of
$1.8 million recorded in the Retail segment related to employee
severance for restructuring the Retail field and ImPress print and
document services management organization.

The cumulative effect of these three items, if excluded, would
reduce first quarter 2008 net income by $9.8 million.  Results for
the first quarter of 2007 included one unusual item which, if
excluded, would increase net income for the first quarter of 2007
by $1.1 million.

At March 29, 2008, the company's balance sheet showed total assets
of $6.1 billion, total liabilities of $3.8 billion and total
shareholders' equity of $2.3 billion.

"In the first quarter, we continued to experience lower sales
levels in both our Contract and Retail segments reflecting the
weaker U.S. economy and our more disciplined, analysis-driven
approach to sales generation and retention, Sam Duncan, chairman
and CEO of OfficeMax, said.  "However, we were successful in
streamlining operations and pursuing cost controls across our
company."

"In our Contract segment, we offset lower sales with improved
gross margin rates to drive operating income margin improvement,"
Mr. Duncan added.  "In our Retail segment, deleveraging of fixed
cost of sales and operating expenses contributed to lower
operating income margin.  Despite challenges in certain parts of
our business as we navigate the weaker U.S. economy, we continue
to advance the strategies of our turnaround plan."

As of March 29, 2008, OfficeMax had total debt of $368.3 million,
excluding $1.470 billion of timber securitization notes which have
recourse limited to $1.635 billion of timber installment notes
receivable.  During the first quarter of 2008, OfficeMax generated
$142.4 million of cash from operations, an increase of
$223.3 million from the first quarter of 2007.  

OfficeMax invested $33.3 million for capital expenditures in the
first quarter of 2008 compared to $28.1 million in the first
quarter of 2007.

"While we are impacted by the weaker U.S. economy, we remain
steadfast in implementing our turnaround plan and operating
initiatives," Mr. Duncan related.  "The sales declines we
experienced during the past two quarters have continued in April."

"However, we remain committed to pursuing initiatives in both
Contract and Retail that will protect our gross margin and
streamline our cost structure," Mr. Duncan concluded.  "We are
focused on further leveraging complementary aspects of our
Contract and Retail businesses well as driving differentiation in
our merchandising and marketing.  Overall, we continue to aim our
strategies at managing through the current macroeconomic
environment while also building the foundation for OfficeMax to
generate long-term shareholder value."

                  About OfficeMax Incorporated

Headquartered in Naperville, Illinois, OfficeMax Incorporated
(NYSE: OMX) -- visit http://www.officemax.com/-- is into both     
business-to-business office products solutions and retail office
products.  The company provides office supplies and paper, in-
store print and document services through OfficeMax ImPress(TM),
technology products and solutions, and furniture to consumers and
to large, medium and small businesses. OfficeMax customers are
served by over 36,000 associates through direct sales, catalogs,
e-commerce.

OfficeMax customers are served by approximately 35,000 associates
through direct sales, catalogs, e-commerce and more than 900
stores.
                          *     *     *

Moody's Investor Service placed OfficeMax Inc.'s probability of
default rating at 'Ba2' in September 2006.  The rating still holds
to date.


ORIENT POINT: Fitch Junks Ratings on Five Note Classes
------------------------------------------------------
Fitch downgraded eight classes of notes issued by Orient Point
CDO, Ltd. and Orient Point CDO, Inc.  The rating actions are
effective immediately:

  -- $249,317 class A-1V downgraded to 'B' from 'AAA' and remains
     on Rating Watch Negative;

  -- $645,481,653 class A-1NVA downgraded to 'B' from 'AAA' and
     remains on Rating Watch Negative;

  -- $648,224,140 class A-1NVB downgraded to 'B' from 'AAA' and
     remains on Rating Watch Negative;

  -- $99,250,000 class A-2 Notes downgraded to 'CCC' from 'AAA'
     and removed on Rating Watch Negative;

  -- $47,000,000 class B Notes downgraded to 'CC' from 'AA' and
     removed from Rating Watch Negative;

  -- $12,183,593 class C Notes downgraded to 'C' from 'A' and
     removed from Rating Watch Negative;

  -- $19,305,096 class D Notes downgraded to 'C' from 'A-' and
     removed from Rating Watch Negative;

  -- $14,771,322 class E Notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative.

Orient Point is a collateralized debt obligation that closed
Oct. 25, 2005 and is managed by Fortis Investments U.S.A.
Presently, 65.5% of the portfolio is comprised of 2005, 2006 and
2007 vintage U.S. subprime residential mortgage-backed securities,
25.9% consists of 2005, 2006 and 2007 vintage U.S. structured
finance CDOs and 7.2% is comprised of 2005, 2006 and 2007 vintage
U.S. Alternative-A RMBS.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS, and SF CDOs with underlying exposure to subprime RMBS.
Since the beginning of 2007, approximately 60.6% of the portfolio
has been downgraded with 20.4% of the portfolio currently on
Rating Watch Negative.  Currently 34.9% of the portfolio is rated
below investment grade.  As of the March 28, 2008 trustee report,
the class A/B, class C/D, and class E overcollateralization ratios
are 101.4%, 99.3%, and 98.3% respectively and all are failing
their tests with respective triggers of 102.4%, 100.7% and 100.2%.   
The failing OC tests are causing interest proceeds to be diverted
before the class C, class D, and class E notes receive their
interest payments.  Fitch expects these classes to receive only
capitalized interest payments in the future with no ultimate
principal recovery.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS.  The classes rated 'CCC' and below are
removed from Rating Watch as Fitch believes further negative
migration in the portfolio will have a lesser impact on these
classes.  Additionally, Fitch is reviewing its SF CDO approach and
will comment separately on any changes and potential rating impact
at a later date.

The ratings of the class A-1V, class A-1NVA, class A-1NVB, class
A-2 and class B notes address the likelihood that investors will
receive full and timely payments of interest, as per the governing
documents, as well as the aggregate outstanding amount of
principal by the stated maturity date.  The ratings of the class
C, class D, and class E notes address the likelihood that
investors will receive ultimate interest payments, as per the
governing documents, as well as the aggregate outstanding amount
of principal by the stated maturity date.


PAMPELONNE CDO: S&P Puts Default Ratings on 12 Classes of Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 19
classes of notes from three collateralized debt obligation
transactions to 'D'.  S&P removed seven of the lowered ratings
from CreditWatch with negative implications.
     
Two of the transactions, Pampelonne CDO I Ltd. and Pampelonne CDO
II Ltd., are high-grade structured finance CDOs of asset-backed
securities backed substantially by U.S. residential mortgage-
backed securities.  The third deal, Durant CDO 2007-1 Ltd., is a
CDO backed substantially by tranches from CDOs of ABS with
exposure U.S. RMBS.  The downgrades follow notices from the
trustees stating that the transactions have liquidated their
portfolio collateral and have distributed, or are in the final
stages of distributing, the proceeds to the noteholders.
     
The trustees for the three CDO transactions have indicated that
they do not expect the proceeds from the sale of the collateral
and in the principal collection account, along with proceeds in
the super-senior reserve account, credit default swap reserve
account, and other sources, to be adequate to cover the required
termination payments to the CDS counterparty, and that it is
likely that proceeds will not be available for distribution to the
notes junior to super-senior swaps in the capital structure of the
CDO transactions.

                  Rating and Creditwatch Actions

                                            Rating
                                            ------
    Transaction            Class         To       From
    -----------            -----         --       ----
Durant CDO 2007-1 Ltd.     A-1           D        CCC-
Durant CDO 2007-1 Ltd.     A-2           D        CC
Durant CDO 2007-1 Ltd.     B             D        CC
Durant CDO 2007-1 Ltd.     C             D        CC
Pampelonne CDO II Ltd.     S             D        B-/Watch Neg
Pampelonne CDO II Ltd.     A-1           D        CCC-/Watch Neg
Pampelonne CDO II Ltd.     A-2           D        CCC-/Watch Neg
Pampelonne CDO II Ltd.     A-3           D        CCC-/Watch Neg
Pampelonne CDO II Ltd.     B             D        CC
Pampelonne CDO II Ltd.     C             D        CC
Pampelonne CDO II Ltd.     D             D        CC
Pampelonne CDO II Ltd.     E             D        CC
Pampelonne CDO I Ltd.      S             D        BB/Watch Neg
Pampelonne CDO I Ltd.      A-1           D        CCC-/Watch Neg
Pampelonne CDO I Ltd.      A-2           D        CCC-/Watch Neg
Pampelonne CDO I Ltd.      B             D        CC
Pampelonne CDO I Ltd.      C             D        CC
Pampelonne CDO I Ltd.      D             D        CC
Pampelonne CDO I Ltd.      E             D        CC


PLASTECH ENGINEERED: Seeks Permission to Wind Down Canadian Unit
----------------------------------------------------------------
Plastech Engineered Products Inc. and its debtor-affiliates seek  
authority from the U.S. Bankruptcy Court of the Eastern District
of Michigan to:

   (1) enter into certain transactions in connection with the
       wind-down of their foreign non-Debtor affiliate, LDM
       Technologies Company, a New Brunswick company;

   (2) enter into a related accommodation agreement with LDM and
       their customers General Motors Corporation, Ford Motor
       Company, Chrysler LLC, on behalf of itself and Chrysler
       Motors LLC, and Chrysler Canada, Inc.;

   (3) enter into a letter agreement by and between LDM and
       Plastech regarding the provision of management services;

   (4) approve payment of $1,000,000 by LDM to Plastech upon
       satisfaction of certain terms and conditions as more fully
       set forth in the Accommodation Agreement; and

   (5) authorize the sale of certain assets on the terms set
       forth in the Accommodation Agreement.

Plastech is the ultimate parent of LDM, and prior to the date of
bankruptcy, LDM's sole source of funding was through intercompany
transfers from Plastech.  During the year 2007, the Debtors
provided funding to LDM aggregating $22,510,893.  In exchange,
LDM historically had directed that 85% of its receivables be paid
directly to the Debtors' bank accounts.  The Debtors collected
about $16,527,533 in receivables directly from LDM's creditors.

In the ordinary course of business, Plastech paid the purchase
price for capital the as equipment, tooling, parts and other
goods, and the capital would be shipped to and received by LDM's
Leamington, Ontario plant.  The purchase price for those assets
was charged by Plastech to LDM as intercompany payable and LDM
listed the capital on its books and records as LDM-owned assets.
Plastech in turn maintained an unsecured intercompany claim
against LDM to the extent that LDM had not paid the intercompany
payable associated with the capital assets.

Similarly, Plastech issued purchase orders to the Customers for
all tooling used by LDM in connection with its manufacture of
component parts for each Customer at LDM's Leamington, Ontario
facility.  The Customers remitted payment to Plastech for the
Tooling purchase orders and Plastech would thereafter transfer
the receivable to LDM pursuant to an intercompany transfer.   The
tooling was delivered directly to LDM at the Leamington facility.

Since Plastech obtained the Court's approval to make a one-time
intercompany payable to LDM of up to $1,900,000 in order for LDM
to satisfy obligations relating to payroll, insurance, taxes,
energy, and supplier obligations, Plastech, LDM and the Customers
worked to direct LDM receivables directly to LDM accounts rather
than channeling the receivables through the Debtors.  The
Customers also agreed to pre-fund and prepay certain obligations
and receivables owed to LDM.

                        LDM's Wind-Down

LDM is experiencing financial difficulties and has determined
that an orderly wind-down of its operations is necessary.  LDM
may effectuate the wind-down by initiating a Companies' Creditors
Arrangement Act proceeding in the Ontario Superior Court of
Justice (Commercial List).

Gregg M. Galardi, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, in Wilmington, Delaware, tells Judge Shefferly that in
connection with the wind-down and financing, the resources of
Plastech's management team are necessarily required as the
majority of LDM's corporate activity occurs through its parent
Plastech.  As the parent of LDM, Plastech's approval of the sale
or release of certain Tooling and Equipment may be required.  As
all or substantially all of the purchase orders associated with
LDM are issued by and payable to Plastech, both Plastech's and
the Court's approval may be necessary to consummate any sales,
releases or transfers of assets from LDM to the Customers.

                     Accommodation Agreement

LDM may effectuate the wind-down by initiating a Companies'
Creditors Arrangement Act proceeding in the Ontario Superior
Court of Justice (Commercial List).  The parties agreed that
should LDM seek a CCAA Proceeding, it should request an order
that, among other things:

   -- allows LDM to continue operating its business through at
      least May 16, 2008;

   -- approves the Accommodation Agreement, including Customers'
      funding of the wind-down;

   -- appoints BDO Dunwoody Ltd. as monitor in the CCAA
      Proceeding;
  
   -- grant liens and security interest to Customers, subject
      only to charges securing obligations to pay reasonable fees
      of its counsel, the Monitor and the Monitor's counsel in an
      amount not to exceed $350,000; and

   -- approves the sale of LDM's assets.

The Customers have requested that during the wind-down, LDM,
among other things, use its commercially reasonable best efforts
to build a bank of component parts for each Customer and assist
the Customers in resourcing to other suppliers.  In order to meet
these requests, LDM requires that the Customers provide financial
and other accommodations.  The Customers will provide financial
accommodations on these terms:

  (1) The Customers will make certain secured loans to LDM, which
      will be used pursuant to a Budget.

  (2) On or before April 25, 2008, $3,560,000 (on account of
      severance pay and accrued vacation pay as reflected in the
      Budget) will be paid to a third-party escrow agent by the
      Customers.  Following the completion of the Production
      Period, the Escrow Agent will release funds on an as needed
      basis.

  (3) The loans will be allocated among the Customers:

       * For all cash needs of LDM, other than Wind-down Costs:

             Chrysler:  72.4%
             GM:        23.1%
             Ford:       4.5%

       * For all Wind-down Costs including stay bonuses:

             Chrysler:  69.125%
             GM:        16.125%
             Ford:      11.75%    

LDM has agreed to continue to manufacture of component parts to
the Customers in accordance with the terms of their purchase
orders.  LDM, together with Plastech, will build an inventory
bank of component parts for each Customer in accordance with an
agreed schedule.  LDM and Plastech will cooperate with each
Customer's preparation for resourcing or resourcing of production
of Component Parts.

                   Plastech's Responsibilities

The Debtors ask the Bankruptcy Court to approve their
responsibilities arising under the Accommodation Agreement:

    (a) Payment to Plastech of the Management Fee, to be paid by
        LDM to Plastech (a) $500,000 within the earlier of (i)
        five days of entry of the initial order entered in a
        CCCA Proceeding initiated by LDM or (ii) five days of the
        effective date of the Accommodation Agreement; and (b)
        $500,000 on May 16, 2008, if LDM satisfies all of its
        obligations to use commercially reasonable best efforts
        under the Accommodation Agreement and if Plastech fully
        cooperates in each Customer's resourcing efforts relating
        to LDM;

    (b) Provide to each Customer reasonable access to LDM's
        operations, books and records at any time during regular
        business hours, or outside of regular business hours upon
        reasonable request and prior notice;

    (c) Cooperate with each Customers' preparation for resourcing
        or resourcing of production of Component Parts;

    (d) Acknowledgment that the Customer Owned Tooling used by
        LDM in connection with its manufacture of Component Parts
        for each Customer at its facility in Leamington, Ontario
        for which a Customer has paid the applicable purchase
        order price for the Tooling are owned by the respective
        Customers;

    (e) Acknowledgment that upon payment in full of LDM's or
        Plastech's actual cost for any item of Unpaid Tooling the
        item will thereafter be included in the definition
        of Customer Owned Tooling under the Accommodation
        Agreement;

    (f) Participate in negotiations with the Canadian Auto
        Workers Union regarding the wind-down of LDM; and

    (g) Grant the Customers an option to purchase LDM's or
        Plastech's entire right, title and interest in and to

          (i) all machinery and equipment that is owned by LDM or
              Plastech and is used by LDM exclusively to
              manufacture Component Parts for the respective
              Customer in Canada, and

         (ii) a royalty-free, irrevocable and fully transferable
              license to use any and all intellectually property
              associate with the Equipment, which option will be
              exercisable at any time on or before June 16, 2008
              upon written notice to Plastech and LDM and the
              purchase price for the option shall be net book
              value of the Equipment for which the option is
              exercised.

Mr. Galardi tells the Bankruptcy Court that an orderly, court-
supervised wind-down and liquidation of LDM is in the best
interests of Plastech as the holder of a large unsecured
intercompany claim against LDM, as the process may afford
Plastech an opportunity to recover on the claim from the proceeds
of the sale of any remaining assets of LDM.  Moreover, in
exchange for cooperating with the Customers' resourcing of
production from LDM and provision of services to LDM pursuant to
the Management Agreement, Plastech will receive a $1,000,000 fee,
he narrates.

Accordingly, the Debtors believe that approval of their
commitments under the Accommodation Agreement are appropriate, in
the best interests of their estates, creditors and other parties-
in-interest.

A full-text copy of the Accommodation Agreement is available for
free at http://researcharchives.com/t/s?2b79

                           *     *     *

The Canadian Driver reports that the closing of the Leamington
Facility will eliminate 300 jobs.

                    About Plastech Engineered

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

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

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

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

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.  (Plastech Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/    
or 215/945-7000)


PLASTECH ENGINEERED: Can Remove Pending Actions Until August 29
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan has
extended the time for Plastech Engineered Products, Inc. to remove
pending actions as of the date of bankruptcy through the later of
Aug. 29, 2008, or 30 days after entry of an order terminating the
automatic stay with respect to any particular action sought to be
removed.

As reported in the Troubled Company Reporter on April 18, 2008,
the Debtors said that they are parties to numerous judicial and
administrative proceedings currently pending in various courts and
administrative agencies.  These actions involve a variety of
claims, some of which are complex.  Specifically, the Actions
include, among others, contract disputes, personal injury,
discrimination, and workers' compensation, the Debtors said.

Because of the number of Actions involved and the variety of
claims, the Debtors require additional time to determine which, if
any, of the Actions should be removed and, if appropriate,
transferred to the Court.

Furthermore, the Debtors related that, because they have been
focused primarily on negotiating their DIP financing, addressing
numerous administrative and substantive matters affecting
customers, vendors, employees, and secured lenders, and
addressing the myriad of other issues inherently faced by debtors
in newly-filed cases, including preparing the Debtors' schedules
of assets and liabilities and statements of financial affairs,
the Debtors have not completed their review of the Actions to
determine whether any Actions should be removed.

                    About Plastech Engineered

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

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

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

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

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.  (Plastech Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/    
or 215/945-7000)


PLASTECH ENGINEERED: Agrees to Return Hyundai Tooling to JCI
------------------------------------------------------------
Plastech Engineered Products Inc. and its debtor-affiliates
entered into a stipulation with Johnson Controls Inc. that allows
JCI to repossess its Hyundai tooling equipment.

Hyundai Motor America contracted with Johnson Controls, Inc., to
produce certain component parts for its NF/CM programs.  As part
of the contract, Hyundai placed in the possession of JCI the
tooling necessary to produce the Hyundai Component Parts for the
CM program and required JCI to fabricate the tooling necessary
for the NF program.  The contract provides that the ownership on
the Toolings remains with Hyundai.

JCI subcontracted with the Debtors to produce some of Hyundai
Component Parts that JCI was required to supply to Hyundai.  JCI
delivered to and placed in the possession of the Debtors certain
of the necessary Hyundai Tooling for the production of the JCI
Component Parts.  Disputes have arisen between the Debtors and
JCI involving alleged claims that the Debtors have asserted
against JCI in relation to the Hyundai NF/CM programs.  

The Debtors claim that JCI is indebted to the Debtors for claims
relating to these disputes:

     * NF/CM Component Inventory  

       This relates to a debit taken by JCI in July, 2007
       following payment to the Debtors for the transfer of
       inventory from the Debtors' plant in McCalla, Alabama to
       Montgomery, Alabama.  The Debtors claim that JCI owes
       $713,403 for the inventory transfer.  JCI asserts that the
       Debtors transferred less inventory than was originally
       paid for by JCI and JCI debited the difference between the
       amount paid and the value of the inventory actually
       transferred.

     * NF Mold Assembly Retro -- McCalla

       This relates to the Debtors' request for a retroactive
       payment due to pricing in 2006.  The Debtors claim that
       JCI owes $156,361.  JCI disputes that the retroactive
       payment is owed because the Debtors released JCI of any
       obligation to make the retroactive under the Financial
       Accommodation Agreement executed on February 12, 2007.  

     * NF Painted Console Assembly

       This relates to the Debtors' request for a retroactive
       payment due to component target pricing.  The Debtors
       claim that JCI owes $472,174.  JCI disputes that payment
       is owed because the Debtors released JCI of any obligation
       to make the retroactive payment under the Financial
       Accommodation Agreement executed on February 12, 2007.

     * NF/CM Phase I Obsolescence -- McCalla, and NF Phase I
       Obsolescence -- Franklin

       This relates to the Debtors' claim that they are entitled
       to payment for unused materials resulting from JCI's re-
       sourcing.  The Debtors claim that JCI owes $169,026.  JCI
       disputes that the unused materials were rendered obsolete
       due to re-sourcing, but rather, that the Debtors purchased
       excess materials not at the direction of JCI for which JCI
       is not obligated to pay the Debtors.

     * CM Tool Repairs

       This relates to the Debtors' claim that it made certain   
       repairs to CM Tooling that cost $54,214.  JCI disputes
       the claim because prior to the Debtors making the repairs,
       JCI informed the Debtors that the repairs should not be
       made due to Hyundai's de-sourcing of the CM program.

     * NF/CM Scrap Variance -- above 2%

       This relates to the Debtors' request for payment relating   
       to scrap rates going forward from April 1, 2007.  The      
       Debtors claim that JCI owes $189,694, which JCI disputes.

In order to resolve these disputes, the parties stipulate that:

   (a) JCI will pay to the Debtors $111,620.

   (b) The Debtors release JCI from all actions, causes of
       action, and obligations relating to the NF/CM Program
       Related Claims provided that the Debtors do not release
       the JCI Released Parties from any and all claims of any of
       the Debtors for increased resin prices in connection with
       the Hyundai NF/CM programs, which claims, notwithstanding
       the release, are expressly preserved.  

   (c) JCI is granted relief from the automatic stay provisions
       of Section 362 of the Bankruptcy Code so that JCI may take
       possession of the Hyundai Tooling.

                    About Plastech Engineered

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

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

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

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

As of Dec. 31, 2006, the company's books and records
reflected assets totaling $729,000,000 and total liabilities of
$695,000,000.  (Plastech Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/    
or 215/945-7000)


PRB ENERGY: Wants To Use $2 Million Facility of Republic et al.
---------------------------------------------------------------
PRB Energy Inc. and PRB Oil and Gass Inc. seek authority from the
Bankruptcy Court to enter into a $2 million Debtor-In-Possession
Loan and Security Agreement with PRB Acquisition LLC, an entity
formed by Republic Financial Corporation and Nex Gen Resources
Corp.

If the DIP Agreement is approved by the Bankruptcy Court, PRB may
borrow up to $2 million, $1 million of which may be advanced only
at the sole discretion of the Exit Lender.

PRB also seeks approval from the Bankruptcy Court to pay the Exit
Lender a 4% commitment fee and a $300,000 due diligence fee as
part of the DIP Agreement.

The loan under the DIP Agreement will mature 270 days from the
effective date of the DIP Agreement and the interest rate will be
18% per annum.

PRB intends to use the cash advance from the DIP Agreement to
continue daily operations, preserve and maintain assets, fund
general overhead and administrative expenses, and cover certain
shortfalls between revenue and expenses.

The Exit Lender will be secured by all of PRB's assets.  

The DIP Agreement further provides that PRB and the Exit Lender
will agree to exclusive negotiations in good faith to reach an
agreement as to the definitive terms for the plan of
reorganization and exit financing.  PRB has agreed to use its best
efforts to have a plan of reorganization, including the exit
financing, effective no later than August 31, 2008, subject to
certain extensions.

Under the plan proposed in the DIP Agreement, the exit financing
would provide for an amount sufficient to satisfy the allowed
claims of PRB's Senior Secured Debentures, any allowed secured
claims, and a commitment to fund the reorganized successor to PRB
Oil & Gas, Inc. with up to $10 million for operations and
drilling, which would be disbursed pursuant to agreed-upon
operating budgets and drilling plans.

Certain oil and gas assets in the State of Wyoming would be sold
and the proceeds placed into a trust for the benefit of allowed
unsecured claims against PRB Energy, Inc., which may include PRB's
10% Senior Subordinated Convertible Notes.  Allowed unsecured
trade claims of PRB Oil and Gas, Inc. would be paid over three
years.  PRB does not expect that holders of PRB common stock would
receive any payments or equity in the reorganized company.

The Exit Lender is entitled to determine the amount of exit
financing that would be invested as equity capital and the amount
intended to constitute debt capital under the capital structure of
the reorganized successor to PRB Oil & Gas, Inc.

The DIP Agreement further provides for a $300,000 commitment fee
for the exit financing.  PRB will have to pay $500,000 in
liquidated damages if it fails to consummate the exit financing.

The DIP Agreement also provides that the Exit Lender will receive
87.5% of the equity in the reorganized company and the remaining
12.5% of the equity is reserved for creditors which may include
PRB's 10% Senior Subordinated Convertible Notes, and other parties
in interest.

The Exit Lender has up to 45 days from the approval of the DIP
Agreement by the Bankruptcy Court to conduct due diligence and
evaluate PRB's business in order to decide whether to enter into a
definitive agreement with respect to the exit financing.  The due
diligence period may be extended for an additional 30 days by the
mutual written consent of PRB and the Exit Lender.

A full-text copy of the Debtor-In-Possession And Security
Agreement is available for free at:

              http://ResearchArchives.com/t/s?2b6f

                    Monthly Operating Reports

PRB Energy reported an opening cash balance of $1,228,103 and a
closing cash balance of $1,112,826 under its monthly operating
report for the period from March 6, 2008, to March 31, 2008.

PRB Oil & Gass Inc. reported an opening cash balance of $248,867
and a closing cash balance of $4,352 under its monthly operating
report for the period from March 6, 2008, to March 31, 2008.

                         About PRB Energy

Headquartered in Denver, PRB Energy Inc. fka PRB Gas
Transportation Inc. -- http://www.prbenergy.com/-- operates as        
independent energy companies engaged in the acquisition,
exploitation, development and production of natural gas and
oil.  In addition, the company and its affiliates provide gas
gathering, processing and compression services for properties it
operates and for third-party producers.  They conduct business
activities in Wyoming, Colorado and Nebraska.

The Debtor filed for chapter 11 protection on March 5, 2008
(Bankr. D. Co. Case No. 08-12658) together with two affiliates,
PRB Oil & Gas Inc. (Case No. 08-12661) and PRB Gathering Inc. (08-
12663).  James T. Markus, Esq., at Block, Markus & Williams LLC
represents the Debtors in their restructuring efforts.  The
Debtors listed assets between $50 million and $100 million and
liabilities between $10 million and $50 million.  They owe at
least $1 million each to four unsecured creditors.


PRIME MORTGAGE: Moody's Cut Ba1 Rating to B3; Puts Under Review
---------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 3 tranches
from one Alt-A transaction issued by Prime Mortgage Trust.  One
tranche remains on review for possible further downgrade.

The collateral backing this transaction consists primarily of
first-lien, fixed -rate, Alt-A mortgage loans.  The ratings were
downgraded, in general, based on higher than anticipated rates of
delinquency, foreclosure, and REO in the underlying collateral
relative to credit enhancement levels.  The actions are a result
of Moody's on-going review process.

Complete rating actions are:

Issuer: Prime Mortgage Trust 2006-CL1

  -- Cl. M-4, Downgraded to Baa3 from Baa1
  -- Cl. M-5, Downgraded to Ba3 from Baa2
  -- Cl. M-6, Downgraded to B3 from Ba1; Placed Under Review for
     further Possible Downgrade


QUALITY HOME: Weak Performance Prompts S&P to Cut Rating to B-
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Cary,
North Carolina-based Quality Home Brands Holdings LLC, including
its corporate credit rating to 'B-' from 'B'.  All ratings remain
on CreditWatch, where they had been placed with negative
implications on April 8, 2008, following weaker-than-expected
operating performance for the fiscal year ended Dec. 28, 2007, and
concern that the company would not be able to meet its financial
covenants in 2008.  About $450 million of reported debt was
outstanding at Dec. 28, 2007 (including a $42.8 million holding
company payment-in-kind note).
     
The downgrade reflects Quality Home Brands' weak operating
performance which resulted in lease- and pension-adjusted leverage
of almost 7x (including holdco payment-in-kind notes), and
uncertainty related to its exposure to the weak housing market
which may continue to affect operating results.
     
"Given the current weak housing market and challenging economic
conditions, we believe the company will not be able to
meaningfully improve its operating performance and meet its
maximum total leverage covenant during the first and second
quarter of fiscal 2008 and possibly the rest of the year unless a
cure provision is exercised under the credit agreement," said
Standard & Poor's credit analyst Bea Chiem.  Alternatively,
Quality Home Brands could seek to amend the terms of its credit
facility.
     
The ongoing CreditWatch listing reflects Standard & Poor's
expectation that the company will be challenged to remain in
compliance with its financial covenants with adequate cushion in
the absence of an amendment, which could result in loss of access
to its revolving credit facility and near-term liquidity concerns.
     
Standard & Poor's will resolve the CreditWatch listing once it
ascertains covenant compliance for the first quarter.  Standard &
Poor's will also review Quality Home Brands' ability to restore
adequate covenant cushion for the rest of 2008 either through
improved operating performance or an amendment to the terms of its
credit facility.  


RADWAN & AFFES: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Radwan & Affes Real Estate Investment, Inc.
        14730 Harper
        Detroit, MI 48224

Bankruptcy Case No.: 08-50353

Chapter 11 Petition Date: April 29, 2008

Court: Eastern District of Michigan (Detroit)

Judge: Phillip J. Shefferly

Debtor's Counsel: Robert N. Bassel, Esq.
                  Email: robert.bassel@kkue.com
                  201 W. Big Beaver, 6th Flr.
                  Troy, MI 48099
                  Tel: (248) 528-1111

Estimated Assets:   $500,000 to $1 million

Estimated Debts: $1 million to $10 million

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


RECYCLED PAPER: Payment Failure Prompts S&P's Default Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Chicago, Illinois-based Recycled Paper Greetings to 'D'
from 'CCC'.  At the same time, Standard & Poor's lowered the
rating on RPG's $77 million second-lien term loan to 'D' from
'CC', while the '6' recovery rating on the facility remains
unchanged.  The rating on the company's first-lien
$20 million revolver and $120 million first-lien term loan was
lowered to 'CC' from 'CCC+' and the recovery rating remains
unchanged at '2'.
     
"The downgrade is based on the company's failure to make its
April 30, 2008, interest payment of $1.6 million on its
$77 million second-lien debt due 2010," said Standard & Poor's
credit analyst Bea Chiem.
     
The company did not make its second-lien interest payment because
it intends to address this as part of an overall capital structure
solution during its current discussions with its lenders.  The
financial sponsor has made an offer to the second-lien holders
whereby the sponsor would invest additional capital in the
business subject to certain conditions.  The second-lien lenders
have not yet responded to the offer.  RPG was operating with a
waiver since it violated its financial covenants for the quarter
ended Jan. 31, 2008.  

Under the waiver, the company had limited access to its
$20 million revolver up to April 28, 2008, and has since drawn on
$3 million, for a total amount of $15.5 million.  The company has
not yet requested another waiver and currently does not have
access to the remainder of its revolving credit facility.  RPG has
a 45-day grace period in which to receive a cure or waiver to
avoid a cross-default under the first-lien credit facilities.  
Second-lien holders have a 180-day standstill period.
     
RPG is a niche company that develops and markets alternative
greeting cards.  Standard & Poor's will monitor RPG's ability to
cure its default and evaluate any changes as additional
information becomes available.


RELIANT CHANNELVIEW: Plan Filing Period Extended to June 20
-----------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
extended Reliant Energy Channelview LP and its debtor-affiliates'
exclusive period to file a Chapter 11 plan until June 20, 2008.

The Court also extended the Debtors' exclusive period to solicit
acceptances of that plan until August 19, 2008.

The Debtors sought the extension to consummate the sale of their
assets to GIM Cogeneration Channelview LLC.

Based in Houston, Reliant Energy Channelview L.P.--
http://www.reliant.com/--owns a power plant located near   
Houston, and is an indirect wholly owned subsidiary of Reliant
Energy Inc.

The company and its three affiliates, Reliant Energy Channelview
(Texas) LLC, Reliant Energy Channelview (Delaware) LLC, and
Reliant Energy Services Channelview LLC filed for chapter 11
protection on Aug. 20, 2007 (Bankr. D. Del. Lead Case No.
07-11160). Jason M. Madron, Esq., Lee E. Kaufman, Esq., Mark D.
Collins, Esq., Paul Noble Heath, Esq., Richards, Robert J. Stearn
Jr., Esq., at Layton & Finger P.A., and Timothy P. Cairns,
Pachulski Stang Ziehl & Jones represent the Debtors. The U.S.
Trustee for Region 3 appointed an Official Committee of Unsecured
Creditors in the Debtors' cases. David B. Stratton, Esq., and
Evelyn J. Meltzer, Esq., at Pepper Hamiltion LLP, represent the
Committee.  When the Debtors filed for protection from their
creditors, they listed total assets of $362,000,000 and total
debts of $342,000,000.  


RESIDENTIAL CAPITAL: Commences Exchange Offer for $12.8 Bil. Notes
------------------------------------------------------------------
Residential Capital LLC commenced offers to exchange any and all
of the U.S. dollar equivalent $12.8 billion outstanding notes of
ResCap for newly issued notes, upon the terms and subject to the
conditions set forth in its Offering Memorandum and Consent
Solicitation Statement dated May 5, 2008, and the related letter
of transmittal and consent.  
    
The new notes will be issued by ResCap, will be guaranteed by
subsidiaries of ResCap and will be secured by a security interest
in substantially all of ResCap's existing and after acquired
unencumbered assets remaining available to be pledged as
collateral.

a) For 2008-2009 Notes:

CUSIP/ISIN: 76113BAL3 / US76113BAK52                 
Outstanding Principal Amount: $398,848,000
Title of Old Notes to be Tendered: Floating Rate Notes due 2008(1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $1,000
Tender After Early Delivery Time: $970

CUSIP/ISIN: 76113BAK5 / US76113BAK52       
Outstanding Principal Amount: $684,014,000
Title of Old Notes to be Tendered: 8.125% Notes due 2008 (1)       
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $1,000       
Tender After Early Delivery Time: $970

CUSIP/ISIN: 76113BAQ2 / US76113BAQ23       
Outstanding Principal Amount: $714,000,000
Title of Old Notes to be Tendered: Floating Rate Notes
                                   due April 2009 (1)       
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $900       
Tender After Early Delivery Time: $870

CUSIP/ISIN: 76114EAB8 / US76114EAB83               
Outstanding Principal Amount: $949,000,000
Title of Old Notes to be Tendered: Floating Rate Notes
                                   due May 2009
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $900       
Tender After Early Delivery Time: $870

CUSIP/ISIN: 76113BAN9 / US76113BAN91, U76134AD4 /
USU76134AD49                 
Outstanding Principal Amount: $576,961,000
Title of Old Notes to be Tendered: Floating Rate
Subordinated               
                                   Notes due 2009 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

b) For 2010-2015 Notes:

CUSIP/ISIN: 76113BAF6 / $2,154,500,000, 76113BAC3 / US76113BAC37,
            U76134AC6 / USU76134AC65              
Outstanding Principal Amount: $2,154,500,000
Title of Old Notes to be Tendered: 8.375% Notes due 2010 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0307840735         
Outstanding Principal Amount: EUR 542,800,000
Title of Old Notes to be Tendered: Floating Rate Notes due 2010
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAM1 / US76113BAM19               
Outstanding Principal Amount: $1,243,500,000
Title of Old Notes to be Tendered: 8.000% Notes due 2011 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0254758872    
Outstanding Principal Amount: EUR 550,000,000
Title of Old Notes to be Tendered: 7.125% Notes due 2012 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76114EAC6 / US76114EAC66                                   
Outstanding Principal Amount: $928,500,000
Title of Old Notes to be Tendered: 8.500% Notes due 2012
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAR0 / US76113BAR06                                
Outstanding Principal Amount: $1,604,500,000
Title of Old Notes to be Tendered: 8.500% Notes due 2013 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0254759920             
Outstanding Principal Amount: GBP 348,920,000
Title of Old Notes to be Tendered: 8.375% Notes due 2013 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800       
Tender After Early Delivery Time: $770

CUSIP/ISIN: XS0307841469             
Outstanding Principal Amount: GBP 363,000,000
Title of Old Notes to be Tendered: 9.875% Notes due 2014
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

CUSIP/ISIN: 76113BAE9 / US76113BAE92, U76134AB8 /
USU76134AB82              
Outstanding Principal Amount: $486,500,000
Title of Old Notes to be Tendered: 8.875% Notes due 2015 (1)
Principal Amount of New Notes to be Issued
Tender Prior to Early Delivery Time: $800      
Tender After Early Delivery Time: $770

(1) Listed on the Luxembourg Stock Exchange.
   
In the exchange offers, ResCap is offering to issue new 8.500%
senior secured guaranteed notes due May 15, 2010 in exchange for
any and all old notes that mature in 2008 and 2009.  In addition,
ResCap is offering to issue new 9.625% junior secured guaranteed
notes due May 15, 2015 in exchange for any and all old notes that
mature in 2010 through 2015.

ResCap will mandatorily redeem one-third of the original principal
amount of each junior secured guaranteed note on May 15, 2013 and
May 15, 2014 with the remaining principal amount paid at maturity.   
All new notes will be denominated in U.S. dollars.  The offer to
exchange old notes for new notes is not subject to proration.  The
senior secured guaranteed notes will be secured on a second lien
basis by the collateral for the proposed new $3.5 billion credit
facility.  The junior secured guaranteed notes will be secured on
a third lien basis by the collateral for that facility.
    
In addition, holders participating in the exchange offers may
elect to receive cash in lieu of the new notes that they would
otherwise receive, pursuant to a "modified Dutch auction" process
described in the offer documents.  Each participating holder
electing to receive cash pursuant to the auction process, must
submit a price denominated in U.S. dollars that specifies the
minimum amount of cash such participating holder wishes to receive
in lieu of each $1,000 principal amount of new notes it would
otherwise receive for tendered old notes.

The indicative offer price specified by a participating holder of
old 2008-2009 notes can be no less than $850 per $1,000 principal
amount of new notes, the indicative offer price specified by a
participating holder of old 2010-2015 notes can be no less than
$650 per $1,000 principal amount of new notes, and in both cases
the indicative offer price specified by a participating holder can
be no greater than $1,000 per $1,000 principal amount of new
notes.  The amounts of cash that ResCap expects to have available
to pay participating holders in lieu of new notes that they would
otherwise receive in the exchange offers will be $700 million with
respect to the old 2008-2009 notes and $500 million with respect
to the old 2010-2015 notes.  Holders will receive new notes in
exchange for old notes submitted but not accepted in the auction
process.
    
Only old notes that are tendered in the exchange offers may
participate in the auction process.  However, old notes may be
tendered in the exchange offers without participating in the
auction process.

ResCap also commenced a cash tender offer for any and all of its
outstanding $1,198,710,000 in aggregate principal amount of
floating rate notes due June 9, 2008 at a purchase price of $1,000
per $1,000 principal amount upon the terms and subject to the
conditions set forth in the offering memorandum and the related
letter of transmittal and consent.  The total purchase price for
each $1,000 principal amount of June 2008 notes includes
an early delivery payment of $30.00 per $1,000 principal amount.   
The CUSIP and ISIN for the June 2008 notes are 76114EAA0 and
US76114EAA01.
    
In conjunction with the offers, ResCap is soliciting consents to
certain proposed amendments to the indentures under which the old
notes were issued.  The proposed amendments to the old notes would
release the subsidiary guarantees of ResCap's obligations under
the old notes and would eliminate certain of the restrictive
covenants and events of default currently in the indentures.   
However, the proposed amendments are not necessary for the
issuance of the new notes and the new subsidiary guarantees or for
the pledge of collateral for the new notes and subsidiary
guarantees.  Accordingly, the offers are not conditioned on
receipt of the requisite consents to adopt the proposed
amendments.
    
Claims with respect to new notes will be effectively senior to
claims with respect to unexchanged old notes.  In addition, claims
with respect to new notes will be effectively senior to claims
with respect to unexchanged old notes to the extent of the value
of all of the assets of the subsidiary guarantors if the requisite
consents from holders of the senior old notes are received.  
Claims with respect to new notes will be contractually senior to
the subordinated old notes.
    
In the offers, ResCap is offering an early delivery payment, which
in the case of the June 2008 notes and old notes that are accepted
in the auction process, will be paid in cash, and, in the case of
all other old notes, will be paid in principal of new notes.  The
early delivery payment will be paid only to holders who validly
tender their old notes, which tender will be deemed to include
their consents to the proposed amendments, prior to 5:00 p.m., New
York City time, on May 16, 2008, unless extended by ResCap with
respect to any or all series of old notes, and do not validly
withdraw their tenders.
    
The offers will expire at 11:59 p.m., New York City time, on
June 3, 2008, unless extended by ResCap with respect to any or all
series of old notes.  Tendered old notes may be validly withdrawn
at any time prior to 5:00 p.m., New York City time, on May 16,
2008, unless extended by ResCap with respect to any or all series
of old notes, but not thereafter.
    
Holders of old notes accepted in the offers will receive a cash
payment equal to the accrued and unpaid interest in respect of
such old notes from the most recent interest payment date to, but
not including, the settlement date.
    
The offers are conditioned on the satisfaction or waiver of
certain conditions.  In particular, the offers are conditioned on
ResCap entering into a new first lien senior secured credit
facility, providing for at least $3.5 billion of commitments on
terms acceptable to ResCap.  As a result of these conditions,
ResCap may not be required to exchange or purchase any of the old
notes tendered.  The offers are not conditioned on receipt of the
requisite consents with respect to the old notes.  ResCap is
currently in negotiations with GMAC LLC, who would act as the
lender under this new first lien senior secured credit facility
which, if entered into, will be on terms acceptable to ResCap and
GMAC.  The new facility would:

     1. fund the cash required for the offers,

     2. repay ResCap's term loan maturing in July 2008, and

     3. replace ResCap's existing $875.0 million 364-day and
        $875.0 million 3-year revolving bank credit facilities.

Documents relating to the offers will only be distributed to
noteholders who complete and return a letter of eligibility
confirming that they are within the category of eligible investors
for this private offer.  Noteholders who desire a copy of the
eligibility letter should contact Global Bondholder Service
Corporation, the information agent for the offers, at (866) 470-
3800 (U.S. Toll-free) or (212) 925-1630 (Collect).

As reported in the Troubled Company Reporter on April 25, 2008,
Residential Funding Company and GMAC Mortgage LLC, both
subsidiaries of Residential Capital, LLC, borrowed $468 million
collectively under a Loan and Security Agreement with ResCap's
parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with
a revolving credit facility with a principal amount of up to
$750 million, providing incremental liquidity for ResCap's
operations until longer-term financing is arranged.  

ResCap and GMAC are investigating various strategic alternatives
related to all aspects of ResCap's business, including extensions
and replacements of existing secured borrowing facilities, and
establishing additional sources of secured funding for ResCap's
operations.  One potential source of new secured funding is credit
secured by certain of ResCap's mortgage servicing rights.

The Troubled Company Reporter also reported on April 9, 2008 that
GMAC LLC purchased $1.2 billion of ResCap's notes in open market.    
The notes have a fair value of approximately $607,192,000 to
ResCap in exchange for 607,192 ResCap Preferred units with a
liquidation preference of $1,000 per unit.  ResCap canceled the
$1.2 billion face amount of notes.  GMAC may, in its sole
discretion, on or before May 31, 2008, contribute up to an
additional approximately $340 million of ResCap notes, having a
fair value of approximately $265,779,000, for additional ResCap
Preferred units.  The ResCap Preferred ranks senior in right of
payment to ResCap's common membership interests with respect to
distributions and payments on liquidation, winding-up or
dissolution of ResCap.

                    About Residential Capital

Headquartered in Minneapolis, Minnesota, Residential Capital LLC
-- http://www.rescapholdings.com/-- is the home mortgage unit of       
GMAC Financial Services, which is in turn wholly owned by GMAC
LLC.

                          About GMAC LLC

GMAC LLC -- http://www.gmacfs.com/-- formerly General Motors      
Acceptance Corporation, is a global, diversified financial
services company that operates in approximately 40 countries in
automotive finance, real estate finance, insurance and other
commercial businesses.  GMAC was established in 1919 and employs
approximately 26,700 people worldwide.  Cerberus Capital
Management LP bought 51% GMAC LLC stake from General Motors Corp.
on December 2006.

As reported in the Troubled Company Reporter on April 25, 2008,
Residential Funding Company and GMAC Mortgage LLC, both
subsidiaries of Residential Capital, LLC, borrowed $468 million
collectively under a Loan and Security Agreement with ResCap's
parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with
a revolving credit facility with a principal amount of up to
$750 million, providing incremental liquidity for ResCap's
operations until longer-term financing is arranged.

Similarly, the Troubled Company Reporter also reported on April
25, 2008 that Moody's Investors Service downgraded GMAC LLC's
senior rating to B2 from B1; the rating remains on review for
further possible downgrade.

The GMAC downgrade is based upon Moody's opinion that further
operating weakness at ResCap poses risks to GMAC's capital
position and liquidity that exceed previous estimates.  In
particular, Moody's believes that for ResCap to have continued
access to debt capital, GMAC may be required to provide additional
indications of support to the unit and that it is likely to do so.   


RESIDENTIAL CAPITAL: S&P Cuts Corp. Credit to CC on Debt Offer
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered selected ratings on
Residential Capital LLC, including lowering the long-term
corporate credit rating to 'CC' from 'CCC+', following the
company's launch of an exchange offer for unsecured bonds that
S&P interpret as a distressed debt exchange.  The ratings remain
on CreditWatch with negative implications, where they were placed
April 24, 2008.  There are no ratings or outlook changes on GMAC
LLC, Residential Capital LLC's parent.
      
"The downgrade reflects the probability that, with the successful
execution of the exchange offer, which will pay less than face
value to certain Residential Capital LLC bondholders, Standard &
Poor's, in accordance with our criteria, will lower our corporate
credit rating on the company to 'SD' (selective default)," said
Standard & Poor's credit analyst John K. Bartko, C.P.A.  In
addition, ratings on the affected debt issues would be lowered to
'D', although the exchange would not constitute a legal default.  
A successful exchange would extend debt maturities, providing
needed relief, but the action illustrates the gravity of the
company's financial position.
     
Furthermore, the exchange indicates that ultimate parents General
Motors Corp. (49% owner of GMAC LLC) and Cerberus Capital
Management L.P. (51% owner of GMAC LLC) are pursuing these actions
rather than directly providing GMAC LLC with additional capital to
downstream to Residential Capital LLC.  S&P believe that if the
exchange fails, Residential Capital LLC might file for bankruptcy
protection.  In this case, Residential Capital LLC would have to
replace at least one of the two departed independent directors, as
the company's operating agreement requires support from at least
one independent director to initiate such a filing.  Accordingly,
our ratings on securities that are not part of the exchange offer
are also on CreditWatch with negative implications.
     
Residential Capital LLC is proposing to offer new secured notes in
exchange for any and all of the $12.9 billion of unsecured bonds.   
The new secured notes would consist of two classes: 8.5% second-
lien notes due May 15, 2010, which would be exchanged for certain
existing debt maturing in 2008 and 2009; and 9.625% junior lien
notes due in 2015 that would be exchanged for existing debt
maturing between 2010 and 2015.  Residential Capital LLC would
offer the new notes to existing bondholders, grouped by the
maturity of the securities that they hold currently, at various
exchange ratios.
     
The exchange offer is intended to advance Residential Capital
LLC's overall restructuring plan, which includes a focus on the
production of prime, conforming products; the reduction of credit
risk through the sale or elimination of noncore businesses and
products; the increased production at GMAC Bank in an effort to
leverage the banks lower-cost funding; structural cost reductions;
and delevering the balance sheet.  The exchange offer would
lighten near-term debt maturities, although interest cost will
increase.

Upon completion of the exchange and review of Residential Capital
LLC's financial position, a new corporate credit rating would be
assigned.


RESIDENTIAL CAPITAL: Debt Exchange Offer Cues Fitch to Cut Rating
-----------------------------------------------------------------
Fitch Ratings has downgraded Residential Capital LLC's Issuer
Default Rating to 'C' from 'BB-' following the company's announced
debt exchange offer.  ResCap remains on Rating Watch Negative
pending execution of the debt exchange offer. Upon completion of
the exchange, Fitch will downgrade ResCap's IDR to 'D' indicating
a default has occurred in accordance with Fitch's criteria on
distressed debt exchanges.  In addition, Fitch has downgraded GMAC
LLC's IDR to 'BB-'.  Approximately $12.9 billion of outstanding
debt is affected by this action.

ResCap is undertaking this exchange offer in order to extend debt
maturities and increase its financial flexibility.  ResCap's
announced debt exchange offer is part of a plan to address the
company's capital structure in light of current and expected
future market conditions, by lengthening debt maturities and
providing security to first lien creditors.  Under the plan, a new
first lien credit facility will have a security interest in
ResCap's unencumbered assets, effectively subordinating existing
noteholders.  Under the exchange offer, existing debt holders will
get new notes in ResCap with extended maturities at less than
current par value for maturities after 2008. ResCap will also
provide a cash tender option for outstanding debt with up to
$1.2 billion in cash.  Importantly, noteholders who do not
exchange could be further disadvantaged by loss of subsidiary
guarantees and become effectively subordinated below the exchange
debt. .

At completion of the exchange, Fitch would assign a post-default
IDR and new issue level ratings solely reflecting a prospective
view of ResCap and its new capital structure.  Fitch envisions
that ResCap's IDR would be in the single 'B' category, with issue
level and Recovery Ratings reflecting relative seniority and
recovery within the capital structure.

Fitch has downgraded these ratings and kept them on Rating Watch
Negative:

Residential Capital LLC
  -- Long-term IDR to 'C' from 'BB-';
  -- Senior debt to 'C' from 'B+';
  -- Subordinated debt to 'C' from 'B-';
  -- Short-term IDR to 'C' from 'B'.


RESIDENTIAL CAPITAL: Moody's Cut Rating to Ca on Exchange Offer
---------------------------------------------------------------
Moody's Investors Service downgraded to Ca, from Caa1, its ratings
on the senior debt of Residential Capital, LLC subject to the bond
exchange announced by ResCap on May 2, 2008.  The rating of
ResCap's approximately $1.2 billion of bonds maturing on June 9,
2008 was affirmed at Caa1.  These bonds are not part of the
exchange and the company has announced they intend to commence a
cash tender for these bonds at par.  All ratings remain under
review for downgrade.  The senior unsecured rating of GMAC LLC was
left unchanged at B2, under review for downgrade.

The downgrade follows the company's announcement of an exchange
offer for certain of its unsecured bonds.  Moody's considers this
exchange to be a distressed exchange because the bonds being
offered in exchange for ResCap's existing debt is being offered at
a discount to par value and will have longer maturities.   
Distressed exchanges are included in Moody's definition of
defaults.

The exchange debt being offered will have second or third lien
claims on ResCap's unencumbered assets behind a proposed
$3.5 billion credit facility that ResCap is negotiating with GMAC.  
These claims on ResCap's unencumbered assets will substantially
subordinate any existing debt that does not participate in the
exchange.  "This exchange was undertaken to assist ResCap in
avoiding a payment default on its existing unsecured bond
obligations," said Moody's Vice President and Senior Credit
Officer Craig Emrick.

If all bonds subject to the exchange participate at the early
delivery price, ResCap's outstanding bonds will be reduced by
approximately $2.2 billion to approximately $11 billion (excluding
the company's June 9, 2008 maturities and $1.75 billion bank line
maturing in July 2008).  This does not include any possible
reduction in outstanding debt through the company's proposed
$1.2 billion modified Dutch auction that is being offered for
those bonds which participate in the exchange.  Of this amount
approximately $3 billion will mature in May 2010 and $2.6 billion
in May 2013, 2014 and 2015 under the terms of the exchange.

Despite the benefits this exchange could have on ResCap's ability
to service its debt, the ratings remain under review for
downgrade.  This is because ResCap has not proven it has a
business model that can produce the required operating cash flow
to service and ultimately repay these reduced obligations.  "Even
after this exchange, we believe ResCap's debt levels will remain
inconsistent with its long term earnings." said Mr. Emrick.

Additionally, the ultimate resolution of the company's
$1.75 billion bank loan which matures in July 2008 and two
$875 million (total of $1.75 billion) committed, undrawn,
unsecured revolvers which mature in June 2008 and June 2010
remains unclear.  Moody's considers this line availability to be
an important source of contingent liquidity.

The rating of ResCap's $1.2 billion of June 9, 2008 bonds was
affirmed at Caa1 as these bonds are not part of the exchange and
the company has announced they intend to commence a cash tender
for these bonds at par.  Additionally, even if the cash tender for
these bonds is not untaken, their maturity in advance of the bank
facilities maturing increases the likelihood they will be repaid.

Downgrades:

Issuer: Residential Capital, LLC

  -- Multiple Seniority Shelf, Downgraded to (P)Ca from (P)Caa1
  -- Subordinate Regular Bond/Debenture, Downgraded to C from Caa2
  -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ca
     from Caa1

Issuer: Residential Funding of Canada Finance ULC

  -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ca
     from Caa1

On Review for Possible Downgrade:

Issuer: Residential Capital, LLC

  -- Senior Unsecured Regular Bond/Debenture, Placed on Review for
     Possible Downgrade, currently Ca

Issuer: Residential Funding of Canada Finance ULC

  -- Senior Unsecured Regular Bond/Debenture, Placed on Review for
     Possible Downgrade, currently Ca

ResCap is a subsidiary of GMAC LLC and is headquartered in
Minneapolis, Minnesota.  Rescap reported equity of $6.0 billion at
Dec. 31, 2007.


ROYAL UTILITIES: S&P Cuts Rating to BB+ After Sherritt Acquisition
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on thermal coal miner Royal Utilities Income Fund to
'BB+' from 'BBB+' after Sherritt International Corp. (not rated)
successfully acquired the remaining 59% of Royal Utilities it did
not already own.  At the same time, S&P removed the ratings from
CreditWatch, where they were placed March 19.  The lowered rating
reflects Standard & Poor's assessment, based on public information
only, that Sherritt's consolidated credit profile including Royal
Utilities would be speculative grade.  Subsequently, S&P withdrew
the ratings at the issuer's request.  Neither Royal Utilities nor
Sherritt has rated debt.


REYNOLDS AMERICAN: Debt Reduction Cues S&P to Lift Rating from BB+
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Winston-Salem, North Carolina-based Reynolds American
Inc. to 'BBB-' from 'BB+'.  Standard & Poor's also raised the
issue-level ratings on RAI subsidiary RJ Reynolds Tobacco
Holdings' senior unsecured debt to 'BBB-' from 'BB+', and affirmed
its issue-level ratings on RAI's senior secured bank facilities
and senior secured notes at 'BBB'.  At the same time, Standard &
Poor's withdrew its '3' recovery rating on the senior unsecured
debt, as well as its recovery rating of '1' on the senior secured
debt.

"The upgrade reflects the continued reduction in debt leverage
since the acquisition of Conwood Companies in May 2006, improved
operating performance, and a more favorable litigation environment
within the domestic tobacco industry," said Standard & Poor's
credit analyst Kenneth Shea.
     
The withdrawal of all recovery ratings relates to RAI's corporate
credit rating crossing into investment grade, as Standard & Poor's
typically does not assign recovery ratings to investment-grade
companies.  The affirmation of the senior secured debt ratings one
notch above the revised corporate credit rating reflects the fact
that, at least for the time being, lenders to the senior
facilities continue to benefit from perfected security interests
in the pledged collateral of the company.  "To the extent that,
per the terms of the various indentures and credit facilities, the
security interests are released and the obligations thereunder
become unsecured, we would reassess the notching on the unsecured
debt," said Mr. Shea.

The ratings on RAI and its wholly owned subsidiary RJRT continue
to reflect the company's participation in the contracting domestic
cigarette industry, its declining shipment volumes and market
share, and significant litigation risk partly offset by relatively
moderate financial policies.
     
The U.S. cigarette industry is mature and highly competitive, and
Standard & Poor's projects that overall domestic shipment volume
will decline at an approximate 3.5% rate in 2008, and 3% annually
thereafter.  Operating company RJ Reynolds Tobacco Co.'s profit
margins still remain below that of its larger competitor, Philip
Morris USA.  However, the May 2006 acquisition of Conwood has
provided some diversification of sales and EBITDA into higher-
margin smokeless tobacco products, as well as providing the
company with additional growth opportunities.


SALISBURY INT'L: Fitch Slashes $33MM Note Rating to CC from A+
--------------------------------------------------------------
Fitch downgraded 1 class of notes issued by Salisbury
International Investments Limited, Series No: 2005-14.  The rating
action is effective immediately:

  -- $33,000,000 class D Credit Linked Notes downgraded to 'CC'
     from 'A+' and removed from Rating Watch Negative.

Salisbury 2005-14 is a partially funded, static synthetic
collateralized debt obligation that closed on Dec. 8, 2005.   
Salisbury 2005-14 references a portfolio comprised primarily of
subprime residential mortgage-backed securities bonds (44.9%),
Alt-A RMBS (24.6%), prime RMBS (1.3%), and other structured
finance assets.  Subprime RMBS bonds of the pre-2005 and 2005
vintages account for approximately 25.3% and 19.6% of the
portfolio, respectively.  Alt-A RMBS of the pre-2005 and 2005
vintages represent approximately 16.9% and 7.6% of the portfolio,
respectively.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime and
Alt-A RMBS.  Since January 2007, approximately 38.5% of the
portfolio has been downgraded with 7.2% of the portfolio currently
on Rating Watch Negative.  About 33.2% of the portfolio is rated
at below investment-grade.  In addition, the Fitch Weighted
Average Rating Factor has increased significantly from 4.27 at the
last rating action in December 2006 to 16.44 currently.

The rating of the class D notes addresses the likelihood that
investors will receive full and timely payments of interest, as
per the transaction's governing documents, as well as the stated
balance of principal by the legal final maturity date.


SEALY CORPORATION: March 2 Balance Sheet Upside-Down by $130MM  
--------------------------------------------------------------
Sealy Corporation's balance sheet at March 2, 2008, showed total
assets of $1.0 billion and total liabilities of $1.1 billion,
resulting in a total shareholders' deficit of about
$130.0 million.

The  company reported net income for the first quarter of
$16.2 million compared with $24.6 million for the same period a
year ago.

Wholesale domestic unit volumes were affected by accounts
transitioning to the company's new Posturepedic line launching
this Spring, reduced volumes from certain customers going out of
business, and lower sales of promotional products.  These factors
were partially offset by continued unit growth in the company's
specialty bedding products.  Branded domestic specialty bedding
product sales increased 17% in the first quarter of 2008 compared
to the comparable period in the prior year.

"During the first quarter we continued to execute on our strategic
initiatives designed to drive AUSP growth, improve operational
efficiencies, and position the company to achieve margin expansion
over time," Larry Rogers, Sealy's interim chief executive officer
and president of North America, stated.  "We initiated a pricing
increase and instituted a more diligent focus on controlling our
costs which enabled us to achieve SG&A expense leverage despite
the decline in sales."

"We also introduced our innovative new Posturepedic line, which
will be key to recapturing share of innerspring sales at price
points above $1,000, and began shipping floor samples of the new
line in March," Mr. Rogers added."

"Our specialty business performed well, despite the deterioration
in overall trends in our domestic business as the quarter
progressed," Mr. Rogers continued.  "We were pleased to see
continued growing demand for our latex product line and relatively
strong performance from our international business."

"Going forward, while industry headwinds have intensified, we will
focus our efforts on what we can control, including proactively
managing our costs and continuing to execute on our strategic
initiatives," Mr. Rogers concluded.  "I am confident that we are
taking steps to strengthen our leading market position and drive
long-term growth."

                  Liquidity and Capital Resources

At March 2, 2008, the company has approximately $33.9 million
available under its revolving credit facility after taking into
account letters of credit issued totaling $23.7 million.

The company has incurred debt, including senior credit facilities
consisting of a $125 million senior secured revolving credit
facility maturing in 2010 and senior secured term loan facilities
maturing in August 2011 and August 2012 with outstanding balances
of $467.1 million at March 2, 2008, for the senior facilities.

The company also have an outstanding principal balance of
$273.9 million at March 2, 2008, on the 2014 Notes.

At March 2, 2008, the company was in compliance with the covenants
contained within its senior credit agreements and indenture
governing the 2014 Notes.

As of March 2, 2008, the company's debt net of cash was
$795.2 million, compared to net debt of $803.0 million as of
Feb. 25, 2007.

                             Dividend

The company also disclosed that its board of directors voted to
suspend the company's quarterly dividend.  This decision is
intended to increase the company's financial flexibility and will
enable it to better allocate its capital in order to enhance
shareholder returns over time.

                   About Sealy Corporation

Headquartered in Trinity, North Carolina, Sealy Corporation (NYSE:
ZZ) -- http://www.sealy.com/-- manufactures and markets a broad   
range of mattresses and foundations under the Sealy(R), Sealy
Posturepedic(R), Stearns & Foster(R), and Bassett(R) brands.  
Sealy operates 26 plants in North America.  


SHAPES/ARCH HOLDINGS: Files Modified Disclosure Statement
---------------------------------------------------------
Shapes/Arch Holdings and its debtor-affiliates delivered a
Modified Joint Disclosure Statement dated April 30, 2008,
explaining their First Amended Joint Plan of Reorganization to the
Hon. Gloria M. Burns of the United States Bankruptcy Court for the
District of New Jersey.

The Plan provides for a fair allocation of the Debtors' assets in
an orderly manner under the Bankruptcy Code and other applicable
law.

The Debtors disclose that the Plan reflects a commitment by:

   a) their lender group -- comprised of The CIT Group/Business
      Credit, Inc., as agent, JPMorgan Chase Bank N.A., and
      Textron Financial Corporation -- to provide the Debtors with
      revolving loans of up to $60 million throughout the chapter
      11 proceedings and upon exiting bankruptcy; and

   b) Arcus ASI Funding LLC to pay off the lender group's term
      loans; to provide funding in excess of what is available
      based upon the Debtors' eligible inventory and accounts in
      light of the cyclical nature of the Debtors' businesses; to  
      provide additional working capital for the Debtors, and to
      fund a dividend to creditors, requiring a total commitment
      by Arcus of approximately $25 million.

The Debtors' Plan will distribute these reserves, after the
effective date (i) Class 5 Pool Escrow of $500,000 or $2,000,000
if Class 5 votes to accept the plan, and (ii) plan Expense Reserve
of $100,000.

                 Treatment of Claims and Interest

                   Type of             Estimated        Estimated
  Class            Claim               Amount           Recovery
  -----            -------             ---------        ---------
  Unclassified     Administrative      $2,513,606         100%
                   Claims

  Unclassified     Arcus DIP Claims    $22,000,000        100%

  Unclassified     Fee Claims          $800,000           100%

  Unclassified     Priority Tax        $84,667            100%
                   Claims

  1                Other Priority      $1,514,113         100%
                   Claims

  2                Miscellaneous       $75,000            100%
                   Secured Claims

  3                CIT Claims          $55,000,000        100%

  4                Collateralized                         100%
                   Insurance Program
                   Claims

  5                General Unsecured   $38,121,413        2%-5%
                   Claims

  6                Ben Interest        NA                 0%

  7                Class 7 Interest    NA                 100%

  8                Class 8 EPA/NJDEP   $350,000           100%

  9                Class 9 Secured     $747,939           100%
                   Real Estate Claims

  10               Class 10 Secured    $TBD               100%

  11               Class 11 Secured    $150,000           100%
                   Claims of
                   Warehousemen and
                   Shippers

Ben LLC holds 100% in membership interest of the Debtors.

A full-text copy of the Modified Disclosure Statement is available
for free at:

     http://ResearchArchives.com/t/s?2b7c

A full-text copy of the First Amended Chapter 11 Plan of
Reorganization is available for free at:

     http://ResearchArchives.com/t/s?2b7e

Headquartered in Delair, New Jersey, Shapes/Arch Holdings,
LLC, produces custom aluminum extrusions for road and rail
transportation and commercial and residential construction.  
The company also manufactures maintenance aluminum fence systems,
for residential and commercial use, and above-ground pools.

The company and four of its affiliates filed for Chapter 11
protection on March 16, 2008 (Bankr. D. N.J. Lead Case No.
08-14631).  Jerrold N. Poslusny, Jr., Esq., at Cozen O'Connor,
represents the Debtors in their restructuring efforts.  The U.S.
Trustee for Region 3 appointed six creditors to serve on an
Official Committee of Unsecured Creditors.  Halperin Battaglia
Raich LLP represents the Committee in this cases.  When the
Debtors filed for protection against their creditors, they listed
assets between $10 million to $50 million and debts between
$50 million to $100 million.


SHARPS CDO: Fitch Cuts Rating to C from BB on $6.9 Million Notes
----------------------------------------------------------------
Fitch has downgraded 6 classes of notes issued by SHARPS CDO I,
and removed them from Rating Watch Negative.  These rating actions
are effective immediately:

  -- $255,162,729 class A-1 to 'A-' from 'AAA';
  -- $9,450,471 class A-2 to 'A-' from 'AAA';
  -- $25,077,674 class B to 'CC' from 'AA+;
  -- $13,801,136 class C to 'C' from 'A+';
  -- $13,127,910 class D to 'C' from 'BBB';
  -- $6,900,568 class E to 'C' from 'BB'.

SHARPS I is a static cash flow collateralized debt obligation  
issued with no trading flexibility and no asset manager.  Deutsche
Bank Trust Company Americas is the trustee for this transaction.

SHARPS I has a portfolio comprised primarily of Alt-A RMBS
(89.95%) and prime RMBS (10.05%).  Alt-A RMBS of the 2005 and 2006
vintages represent approximately 29.44% and 59.45% of the
portfolio.

The classes A-1 and A-2 notes benefit from external credit
enhancement provided by a financial guaranty policy underwritten
by CIFG Assurance North America.  In the absence of credit
enhancement provided by the wrap Fitch would rate both A-1 and A-2
classes as highly speculative below investment grade securities.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically Alt-A RMBS.  
Since the transaction closed on Dec. 15, 2006, approximately 63%
of the portfolio has been downgraded with 40.9% of the portfolio
currently on Rating Watch Negative.  The negative credit migration
is primarily attributable to credit deterioration in Alt-A RMBS
bonds from the 2005 and 2006.

The classes rated 'CCC' and below are removed from Rating Watch as
Fitch believes further negative migration in the portfolio will
have a lesser impact on these classes.  Additionally, Fitch is
reviewing its SF CDO approach and will comment separately on any
changes and potential rating impact at a later date.

The ratings of the classes A-1 and A-2 notes (class A notes) and
class B notes address the likelihood that investors will receive
full and timely payments of interest, as per the transaction
governing documents, as well as the aggregate outstanding amount
of principal by the legal final maturity date.  The ratings of the
classes C, D, and E notes address the likelihood that investors
will receive ultimate interest payments, as per the transaction
governing documents, as well as the aggregate outstanding amount
of principal by the legal maturity date.


SPECIALTY UNDERWRITING: Fitch Downgrades Ratings on $97.5MM Certs.
------------------------------------------------------------------
Fitch Ratings has taken rating actions on three Specialty
Underwriting and Residential Finance mortgage pass-through
certificate transactions.  Unless stated otherwise, any bonds that
were previously placed on Rating Watch Negative are now removed.  
Affirmations total $86.2 million and downgrades total $97.5
million.

Series 2003-BC1
  -- $2.4 million class A affirmed at 'AAA';
  -- $15.9 million class M-1 affirmed at 'AA+';
  -- $2.8 million class M-2 affirmed at 'A';
  -- $1.9 million class B-1 downgraded to 'B-/DR1' from 'B';
  -- $0.9 million class B-2 remains at 'C/DR6'.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 16.41%;
  -- Realized Losses to date (% of Original Balance): 2.68%.

Series 2003-BC2
  -- $11.5 million class M-1 affirmed at 'AA+';
  -- $8.7 million class M-2 downgraded to 'B-/DR1' from 'B';
  -- $1.7 million class B-1 affirmed at 'CC/DR3';
  -- $0.0 million class B-2 revised to 'C/DR6' from 'C/DR5'.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 18.09%;
  -- Realized Losses to date (% of Original Balance): 2.87%.

Series 2004-BC4
  -- $24.5 million class A-1A affirmed at 'AAA';
  -- $6.1 million class A-1B affirmed at 'AAA';
  -- $21.2 million class A-2C affirmed at 'AAA';
  -- $64.9 million class M-1 downgraded to 'BBB-' from 'A';
  -- $17.7 million class M-2 downgraded to 'BB' from 'BBB';
  -- $1.4 million class M-3 downgraded to 'BB-' from 'BBB-';
  -- $1.4 million class B-1 downgraded to 'B' from 'BB+';
  -- $0.8 million class B-2 downgraded to 'B' from 'BB';
  -- $0.7 million class B-3 downgraded to 'C/DR6' from 'BB-'.

Deal Summary
  -- Originators: Various;
  -- 60+ day Delinquency: 22.95%;
  -- Realized Losses to date (% of Original Balance): 1.08%.


SOLO CUP: Fitch Affirms Ratings and Revises Outlook to Positive
---------------------------------------------------------------
Fitch Ratings has affirmed Solo Cup Company's Issuer Default
Rating and existing credit ratings as:

  -- IDR affirmed at 'B-';
  -- Senior secured term loan affirmed at 'BB-/RR1';
  -- Senior secured revolving credit facility affirmed at
     'BB-/RR1';

  -- Senior subordinated notes affirmed at 'CCC+/RR5'.

The Rating Outlook is revised to Positive from Stable.  
Approximately $756 million of debt is covered by the ratings.  The
company's Canadian bank debt is excluded from the ratings.

The Rating Outlook revision is based on positive operating trends
and continued execution of the company's turnaround strategy,
which offset concerns about potentially weaker volumes and cost
inflation.  Fitch expects that the company's earnings and cash
flow will continue to improve in 2008, and credit metrics should
continue to strengthen during the year.  In addition, Solo has
resolved all outstanding material weaknesses in internal controls.  
If Solo's performance continues to meet these expectations over
the course of the coming quarters, the ratings could be reviewed
for a possible upgrade.

The ratings recognize Solo's leading market share across its
product categories; strong brand recognition; diversified raw
materials mix; diverse, stable customer base; and modest near-term
debt maturities.  Concerns center on high leverage; margin and
volume pressure due to intense competition; and cost inflation in
resin and energy prices.  Fitch also expects softer industry
volumes in the coming year, which could generally constrain demand
and erode price support.

Fitch's recovery analysis continues to indicate full expected
recovery of the company's bank debt in a hypothetical distressed
scenario.  Expected recovery for the senior subordinated notes
remains within the 'RR5' band (11%-30%).  Improved earnings or an
upward revision of the IDR could lead to an upgrade of the notes
in the intermediate term.

Solo has made clear progress through its performance improvement
program, achieving about $75 million of cost savings, greater than
initial expectations of $60 to $70 million.  Performance
consultants have been disengaged which should result in additional
cost savings of $20 million or more going forward.  While some
earnings potential has been lost due to business divestitures,
improved efficiencies, better product mix management, and greater
pricing discipline are likely to more than offset these losses.

Higher raw materials prices and other cost inflation will likely
continue to challenge profitability for Solo.  In addition,
competition within Solo's key markets remains intense.  General
foodservice industry volumes are likely to be softer in the coming
year with growth rates in the low single digit range.  Solo's
ability to manage its core product portfolio profitably in the
face of these challenges will be monitored.

Solo achieved meaningful debt reduction in 2007 and as a result
total leverage has declined appreciably from 9.8 times at first
quarter ended Apr. 1 2007 to 5.7x at fiscal year end 2007, by
Fitch calculations.  Fitch expects further deleveraging as
trailing twelve month EBITDA figures begin to benefit from the
cost savings and an unusually weak 1Q07 falls out of the
calculation.  Solo has announced a few remaining asset sales in
2008 which could serve to reduce debt modestly by the end of the
year.  Fitch expects the company will be able to meet tightening
consolidated leverage ratio requirements over the course of 2008.  
By fiscal year end, Solo must achieve leverage of 4.5x according
to the terms of its bank credit agreement.

Fitch expects certain cash expenses to increase in the near term
stemming from announced facility realignments and higher
management compensation.  Capital expenditures are also likely to
move higher in 2008 as the company modernizes some equipment.  
Free cash flow is projected to remain positive and should improve
from the 2007 figure of $48.4 million, as Fitch expects higher
earnings and better working capital management.


SOUTH FINANCIAL: Fitch Puts 'BB' Rating on $250MM Preferred Stock
-----------------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating to the mandatory
convertible non-cumulative preferred stock issued by The South
Financial Group, Inc. (Nasdaq: TSFG, 'BBB-/F3', Negative Rating
Outlook).  The issuance consists of $250 million in series 2008
convertible preferred stock.  These preferred shares pay a
dividend of 10.00% and mandatorily convert into common equity
shares of TSFG in three years.  These securities will be treated
as Tier 1 capital for regulatory capital purposes.

Fitch assigns class E (100% equity content) equity treatment to
these securities, subject to the limitation that TSFG's aggregate
hybrid securities not exceed 30% of eligible capital.  The high
equity content reflects the level of subordination and the non-
cumulative structure of the preferred stock.  Of note, once the
conversion into common equity is accomplished, the security will
no longer be subject to the hybrid capital limitation.  Fitch
notes that shareholder approval is required for conversion.  
Should common stock shareholders not approve the conversion prior
to the conversion date, the dividend rate on the preferred shares
increases considerably, but remains non-cumulative.  This step-up
feature is intended to encourage shareholder approval.  TSFG
intends to use the proceeds from this issuance for general
corporate purposes and the repayment of short-term borrowings.

TSFG's Rating Outlook remains Negative.  While the additional
capital creates a larger buffer against ongoing earnings pressure,
Fitch believes TSFG will continue to face elevated levels of
problem assets and credit losses.  Given Fitch's outlook for the
housing market and general economic conditions, particularly in
Florida, TSFG's internal equity generation will likely remain
diminished in the near and intermediate term.

Fitch assigned these rating with a Negative Outlook:

South Financial Group, Inc. (The)
  -- Preferred stock 'BB'.


STEVEN MOLASKY: Case Summary & 14 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Steven D. Molasky
        One Hughes Center Dr., Ste. 1404
        Las Vegas, NV 89169

Bankruptcy Case No.: 08-14517

Chapter 11 Petition Date: May 3, 2008

Court: District of Nevada (Las Vegas)

Judge: Mike K. Nakagawa

Debtor's Counsel: Laurel E. Davis, Esq.
                  Email: ldavis@fclaw.com
                  Fennemore Craig, P.C.
                  300 S. Fourth St., Ste. 1400
                  Las Vegas, NV 89101
                  Tel: (702) 692-8000
                  Fax: (702) 692-8099
                  http://www.fclaw.com/

Estimated Assets: $50 million to $100 million

Estimated Debts:  $50 million to $100 million

Debtor's 14 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Asset LA, LLC                                        $19,194,150
100 City Pkwy. Ste. 1700
Las Vegas, NV 89106

One Cap Funding Corp.          long beach            $9,610,833
5440 W. Sahara Ave. 3rd Flr.
Las Vegas, NV 89146

                               Altessa               $5,564,667

                               Clarion #178          $1,043,194

                               Clarion $172          $676,155

Irwin Union Bank               loans                 $3,897,490
500 Wash. St.
Columbus, IN 47201

Irwin Molasky                                        $3,408,750
100 City Pkwy. Ste. 1700
Las Vegas, NV 89106

Park Corp.                                           $3,083,000
6200 Riverside Drive
Cleveland, OH 44135

Redwood Capital Finance Co.,                         $3,000,000
LLC
222 North Sepulveda Blvd.
El Segundo, CA 90245

M Funding LLC                                        $2,868,000
100 City Pkwy. Ste. 1700
Las Vegas, NV 89106

Kenneth Wynn                   notes                 $2,208,289
1717 Enclave
Las Vegas, NV 89134

Bank of Nevada                                       $1,417,331
P.O. Box 26237
Las Vegas, NV 89126-0237

Sun West State Bank                                  $469,676
5830 W. Flamingo Road
Las Vegas, NV 89103

Andrew Molasky                                       $234,882

Irwin A. Molasky Family Irrev.                       $162,450
Trust

Alan Molasky                                         $154,000


STRUCTURED ASSET: Moody's Lowers Ratings on 57 Certificate Classes
------------------------------------------------------------------
Moody's Investors Service has downgraded 57 certificates and
placed on review for possible downgrade 19 classes of certificates
from 11 transactions issued by Structured Asset Securities Corp.  
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: Structured Asset Securities Corporation 2005-S1

  -- Cl. M4, Placed on Review for Possible Downgrade, currently A1
  -- Cl. M5, Downgraded to Baa3 from A2; Placed Under Review for
     further Possible Downgrade

  -- Cl. M6, Downgraded to Ba3 from Baa3
  -- Cl. M7, Downgraded to Caa1 from B2
  -- Cl. M8, Downgraded to C from Ca

Issuer: Structured Asset Securities Corp Trust 2005-S2

  -- Cl. M6, Placed on Review for Possible Downgrade, currently A3
  -- Cl. M7, Downgraded to Ba2 from Baa3
  -- Cl. M8, Downgraded to B3 from Ba1
  -- Cl. M9, Downgraded to Caa2 from B3

Issuer: Structured Asset Securities Corp Trust 2005-S3

  -- Cl. M7, Placed on Review for Possible Downgrade, currently
     Baa1

  -- Cl. M8, Downgraded to B1 from Ba1
  -- Cl. M9, Downgraded to Caa1 from B1

Issuer: Structured Asset Securities Corp Trust 2005-S5

  -- Cl. M3, Placed on Review for Possible Downgrade, currently
     Aa3

  -- Cl. M4, Downgraded to Ba3 from Baa2
  -- Cl. M5, Downgraded to B3 from B1
  -- Cl. M6, Downgraded to C from Caa2

Issuer: Structured Asset Securities Corp Trust 2005-S6

  -- Cl. M2, Placed on Review for Possible Downgrade, currently
     Aa2

  -- Cl. M3, Placed on Review for Possible Downgrade, currently
     Aa3

  -- Cl. M4, Downgraded to Baa1 from A1; Placed Under Review for
     further Possible Downgrade

  -- Cl. M5, Downgraded to Ba3 from Baa2
  -- Cl. M6, Downgraded to B2 from Ba1
  -- Cl. M7, Downgraded to Caa2 from B3
  -- Cl. M8, Downgraded to C from Caa3
  -- Cl. M9, Downgraded to C from Ca

Issuer: Structured Asset Securities Corp Trust 2005-S7

  -- Cl. M1, Placed on Review for Possible Downgrade, currently
     Aa1

  -- Cl. M2, Downgraded to A1 from Aa2; Placed Under Review for
     further Possible Downgrade

  -- Cl. M3, Downgraded to A3 from Aa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M4, Downgraded to Baa2 from A3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M5, Downgraded to Ba2 from Baa1
  -- Cl. M6, Downgraded to B2 from Ba2
  -- Cl. M7, Downgraded to Caa2 from B3
  -- Cl. M8, Downgraded to C from Caa3

Issuer: Structured Asset Securities Corp Trust 2006-ARS1

  -- Cl. A1, Downgraded to B1 from A3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M1, Downgraded to Ca from Ba1
  -- Cl. M2, Downgraded to C from B3
  -- Cl. M3, Downgraded to C from Caa2
  -- Cl. M4, Downgraded to C from Ca

Issuer: Structured Asset Securities Corp Trust 2006-S1

  -- Cl. A2, Downgraded to A1 from Aa1; Placed Under Review for
     further Possible Downgrade

  -- Cl. M1, Downgraded to Ba1 from Aa3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M2, Downgraded to Ba3 from Baa1
  -- Cl. M3, Downgraded to B2 from Baa2
  -- Cl. M4, Downgraded to Caa1 from Ba3
  -- Cl. M5, Downgraded to C from Caa2
  -- Cl. M6, Downgraded to C from Ca

Issuer: Structured Asset Securities Corp Trust 2006-S2

  -- Cl. M1, Downgraded to A3 from Aa3; Placed Under Review for
      further Possible Downgrade

  -- Cl. M2, Downgraded to Ba3 from Baa1
  -- Cl. M3, Downgraded to B2 from Baa2
  -- Cl. M4, Downgraded to B3 from Ba2
  -- Cl. M5, Downgraded to Caa2 from B3
  -- Cl. M6, Downgraded to C from Caa2
  -- Cl. M7, Downgraded to C from Ca

Issuer: Structured Asset Securities Corp Trust 2006-S3

  -- Cl. M-1, Downgraded to Ba1 from A3; Placed Under Review for
     further Possible Downgrade

  -- Cl. M-2, Downgraded to B2 from Ba1
  -- Cl. M-3, Downgraded to Caa1 from Ba3
  -- Cl. M-4, Downgraded to C from Caa2
  -- Cl. M-5, Downgraded to C from Ca

Issuer: Structured Asset Securities Corporation 2006-S4

  -- Cl. A, Downgraded to Aa3 from Aaa; Placed Under Review for
     further Possible Downgrade

  -- Cl. M1, Downgraded to Baa2 from Aa1; Placed Under Review for
     further Possible Downgrade

  -- Cl. M2, Downgraded to Ba2 from A3
  -- Cl. M3, Downgraded to B2 from Baa2
  -- Cl. M4, Downgraded to Caa1 from Baa3
  -- Cl. M5, Downgraded to Caa2 from Ba3
  -- Cl. M6, Downgraded to Ca from B1
  -- Cl. M7, Downgraded to Ca from Caa1


ST. JOSEPH'S: Moody's Assigns Ba1 Rating on $236.6 Million Bonds
----------------------------------------------------------------
Moody's Investors Service has assigned a Ba1 rating to St.
Joseph's Healthcare System's $236.6 million Series 2008 Bond Issue
to be issued by the New Jersey Health Care Facilities Financing
Authority.  The outlook is positive.

The Ba1 rating is an initial rating and reflects this two hospital
provider's essentiality in its market offset by the impact of a
232% increase in debt to fund needed facility improvements.  The
positive outlook speaks to the recent favorable momentum
established by this newer management team that has translated into
recent profitable operating performance which could contribute to
an improved credit profile over the intermediate term.

Use of Proceeds: Bonds will refund existing Series 1996A (Ambac
insured) and Series 2003 bonds.  The 1996B bonds will also be cash
defeased.  New money proceeds will largely be spent at
St. Joseph's Regional Medical Center.  Bonds will fund
construction of a critical care tower at the SJRMC campus which
will expand the existing emergency room, add 12 new operating room
suites and add 56 private critical care beds.  Reconfiguration of
SJRMC with new lobby, separate pediatric waiting area, and new
clinic and outpatient specialty space will also be funded from
proceeds.  At St. Joseph's Wayne Hospital, renovations will result
in an improved ICU/CCU unit, and expansion of existing operating
suites and renovated lobby area.

Legal Security: Annual debt service coverage of 1.10 times and 35
days of cash on hand.  Gross revenue pledge and mortgage provided.  
Historical covenants that limit any transfers between SJRMC and
SJW will be eliminated.

Interest Rate Derivatives: none

Strengths

  * Essentiality of services and designation as a safety net
    hospital in Passaic County, offering increasingly tertiary
    care services including trauma, cardiology and regional
    perinatal center.

  * Refocused strategic direction and change in culture since new
    management team was put in place in 2004.

  * Improving market presence in Paterson with a leading 24%
    market share in its four-county service area that is expected
    to increase following the closure of two former competing
    facilities, unified operations with full incorporation of
    Wayne General Hospital into the system and recent physician
    recruitments.

  * Under the direction of new management, significant turnaround
    in financial performance at WGH following structural
    reorganization of system around service lines.  Significantly
    improved managed care contracting arrangements results in
    increased revenue and equity of payment rates between WGH and
    SJH.

  * Project will finance needed projects at SJRMC and WGH and
    eliminate restrictive covenants included in existing documents
    that limits the system's ability to pool resources and capital
    spending.

Challenges

  * Financial performance is dependent on charity care funding
    despite the underlying financial improvement and success of
    various growth strategies due to a challenging payer mix

  * Weak balance sheet and underinvestment in facilities are the
    result of extended years of poor performance at WGH and SJRH
    and gap in senior leadership

  * Addition of $168 million of new debt for current projects
    materially affects all ratios and represents the beginning of
    an extensive capital plan

  * Need to joint venture with physicians to maintain loyalty and
    retain interest may present new credit risk as income is now
    shared

  * No established fundraising record as the system prepares to
    launch a large campaign for additional capital projects.

  * Location in Paterson with below average demographics and
    economic factors contributes to current reluctance of suburban
    patients to use the facility

  * Making up for years of inadequate management and board
    oversight which left the organization with a weaker financial
    profile than what fundamentals would suggest

Market Position/Competitive Strategy: Improving Profile and
Leading Market Share

St. Joseph's Healthcare System is comprised of St. Joseph's
Regional Medical Center, St. Joseph's Children's Hospital located
on the Paterson campus, St. Joseph's Wayne Hospital in Wayne, a
nursing home, home health agency and more than two dozen
ambulatory and clinic sites located throughout the service area in
Passaic, Essex, Bergen and Hudson counties in northern New Jersey.  
SJRMC is a tertiary provider with centers of excellence in
cardiology, Level II trauma and pediatrics, while SJW, acquired
from the Saint Barnabas Health System in 2001, provides more
primary care services with a focus on geriatrics, subacute and
rehabilitation services.

SJRMC and SJW have only recently begun operating as a single
system with a common vision to grow.  Limited strategic
opportunities were pursued in the years immediately following
SJW's acquisition (2001) because each facility was independently
struggling with large operating deficits, facility needs,
compounded by a lack of board oversight and management leadership
to provide guidance during this period. SJRMC also lost its safety
net designation which materially reduced its revenue.

Organizational stability and the beginning of the turnaround began
with the hiring of the current management team in 2004 who Moody's  
credit with bringing the hospitals together, standardizing
benchmarks for productivity, and reorganizing the system around
clinical lines to use the physical space of the two hospitals more
effectively.  Clinical programs that were not financial
contributors were closed including obstetrics at SJW, which was
consolidated at SJRMC.  More recently, renegotiated managed care
contracts to include SJW and new vendor contracts have solidified
the unified contracting strategy of the two hospitals which has
translated into tangible savings.

Physicians and staff remained loyal during the difficult years of
2000-2003 but the stabilized operating environment has led to the
successful recruitment of 167 new physicians since 2006,
contributing to a 5.8% increase in inpatient admissions in 2007.  
Management is pursuing multiple joint ventures with its medical
staff.  To date only a joint venture for a cadiac cath lab at SJW
is operational but a joint venture for additional cath labs at
SJRMC, a dialysis center, imaging and endoscopy are also being
planned to keep the medical staff engaged and increase volumes
further.  Although the medical staffs' by-laws are separate at the
two hospitals (60% overlap), collaboration around quality,
clinical standards and medical records are identical.

The system records leading market share in its service area with
24% market share, followed by Hackensack University Medical Center
with 10%.  The children's' hospital has a leading 34% market share
for pediatric services and contributes 28% of total admissions.  
The system has established an academic relationship with St.
Jude's Children's Research Hospital through which the hospital's
Medical Oncologists participate weekly via telemedicine
capabilities in a combined Lymphoma and Leukemia conference.  The
immediate market is somewhat in flux, with the recent bankruptcy
filing by Barnert Hospital, the merger of Passaic Beth Israel into
St. Mary's Hospital, and Mountainside Hospital purchased by for-
profit Merit Health from Atlantic Healthcare System.

Moody's believe that SJRMC will benefit from these market changes
through new additions to its medical staff and additional patient
volumes, although we also believe that SJRMC will continue to be
impacted in the short-term, by its location in Paterson (General
Obligation rating of Baa3) and the reluctance of insured suburban
patients to travel to SJRMC for care.  The System hopes to be the
leader in the redevelopment of the area surrounding its Paterson
campus and the designation as a hospital enterprise zone brings
certain tax advantages to businesses and physician practices
relocating to this area.

However, state and federal funding has not been received and the
timetable for improving the immediate area may not occur as
quickly as management anticipates.  Moody's would expect that the
improvements to the facility as a result of this financing should
add to the attractiveness of the campus and enhance the patient
experience while the surrounding area is undergoing improvements.  
Nonetheless, the image of Paterson, real or perceived, could be a
limiting factor to future growth.

Operating Performance: Turnaround in Financial Performance
Underway Since Reorganization in 2003

SJHS suffered from multiple financial challenges through FY 2003
as a result of turnover in senior management, ineffective
oversight by the board, and consultants who let the safety net
status of SJRMC lapse which resulted in significant lost revenue
($57 million) for charity care for fiscal years 2000-2002.  
Prolonged losses at SJW following its acquisition in 2001 added to
the financial distress and depleted balance sheet reserves.  The
system has made much progress since those years and new management
has been effective in re-establishing SJRMC's safety net status to
garner state dollars from charity care subsidy funds.  Managed
care contracting as a system materially increased rates to SJW,
contributing to the turnaround at that facility as did attention
to billing and documentation.  Productivity standards based on
volume and renewed focus on growth as a strategic initiative for
financial improvement have been implemented with favorable
results.

The system has experienced marked improvement in operating
performance over the last three years, most recently earning
$6.4 million (Moody's excludes investment income and one time
gains on sale of real estate) on $553.1 million of total operating
revenue (1.2% operating margin) for FY2007.  However, system
performance has been inconsistent despite being improved from
historical levels.  Varying profit margins at SJRMC and SJW
reflect variances in prior year settlements and subsidy dollars
received.

Additionally, the hospitals were inadvertently hurt by the success
of length of stay reductions which materially reduced revenue from
per diem contracts during 2005 and particularly in 2006, causing
total revenue to actually decline by 1.75% in 2006 over 2005
despite small gains in inpatient volume.  Managed care contracts
have since been renegotiated with the full benefit expected to be
realized beginning in fiscal 2008 from new contracts signed in
2007 (we favorable note the 7.8% increase in revenue in 2007 over
2006 levels).  Operating cashflow has ranged from $22.6 million to
$32.4 million during the last four years producing a below average
5.0% operating cash flow margin.  Projected operating margins
remain below 2% through the projected period (2008-2011).

The bonds increase annual debt service materially, and the current
run rate must be sustained to maintain minimally acceptable
maximum annual debt service coverage.  MADS increases to
$18.284 million per year from $14.9 million which should be
adequately covered based on total cashflow of $34.6 million
generated in FY2007 (pro forma MADS of 1.89 times).  Projections
anticipate annual increases in cashflow as growth strategies bear
results and volume increases at both hospitals.  Operating
cashflow margin is expected to make steady annual progress,
reaching 6.4% by 2011 from 5.0% at FYE2007.  Meeting cashflow
targets will be an important component of any future rating
upgrade.

Balance Sheet Position: Leveraged Balance Sheet Following Debt
Issue; Cash Balances are Light

The current balance sheet reflects the impact of multiple years of
poor financial position.  Days cash on hand of 71.4 days is modest
for a system of this size, although we do note that these balances
($103.69 million) have grown considerably since 2001 when the
system only had $32.2 million of cash on hand.  The additional
debt increases the current debt position by 232%, and reduces the
favorable cash-to-debt ratio at FYE 2007 of 146.8% to a slim 36.6%
ratio.  

The system prepaid the $18 million note payable to Saint Barnabas
Healthcare System for SJW during 2007, contributing to a reduction
in debt during the year above normal principal amortization and
contributing to the very favorable debt to cashflow ratio of 2.38
times for FY2007.  Debt to cashflow increases unfavorably with the
addition of new money debt of Series 2008 to 14.2 times but the
lowered debt service resulting from refinancing existing bonds
with a front-loaded debt structure provides some offset to the
increased debt service going forward.  However, pro forma MADS
coverage remains light, with projected coverage reaching 2.84
times in FY 2011 with projected cash flows.

Additional debt could be expected in the intermediate term once
the system establishes its track record of performance and
completes the projects being financed with 2008 bond proceeds.  
The facilities have been undercapitalized with a capital spending
ratio consistently below one times and the average age of plant an
above average 13.8 years for FY2007.  A capital campaign with a
goal to raise $40 million over the next five years is underway and
would be the system's first campaign in recent years.
Outlook

The positive outlook is based on our belief that SJHS is
positioned to improve its credit rating if the growth initiatives
being implemented drive new volume to the facilities and favorable
operating performance and balance sheet indicators result.
Consistency of performance will also be an important consideration
in any future rating action.

What could change the rating--UP

Improved operating performance that meets projected targets,
reduction in leverage, improved market position

What could change the rating--DOWN

Additional debt without commensurate increase in cashflow,
reduction in cash, downturn in operating performance

Key Iindicators

Assumptions & Adjustments:

  -- Based on financial statements for St. Joseph's Healthcare
     System, Inc. and Affiliates

  -- First number reflects Audit year ended December 31, 2006

  -- Second number reflects audit year ended December 31, 2007,
     including Series 2008 Bonds

  -- Includes $185.6.0 million of additional debt from Series 2008
     bonds (232% increase)

  -- Excludes $560 thousand of non-recurring revenues and $5.979
     million of investment income

  -- Investment returns smoothed at 6% unless otherwise noted

  -- Pro forma Interest expense "grossed up" to include
     capitalized interest

  * Inpatient admissions: 33,247 ; 35,541

  * Total operating revenues: $513.0 million; $553.1 million

  * Moody's-adjusted net revenue available for debt service: $27.6
    million; $34.6 million

  * Total debt outstanding: $71.3 million; $236.6 million

  * Maximum annual debt service (MADS): $13.774 million; $18.284
    million

  * MADS Coverage with reported investment income: 2.44 times;
    1.89 times

  * Moody's-adjusted MADS Coverage with normalized investment
    income: 2.52 times; 1.84 times

  * Debt-to-cash flow: 2.38 times; 12.12 times
  * Days cash on hand: 71.4 days; 70.1 days
  * Cash-to-debt: 116.8%; 36.6%
  * Operating margin: 1.2%; (.7)%
  * Operating cash flow margin: 5.0%; 5.0%

Rated Debt

  -- Series 2008, $240 million, rated Ba1


THOMAS WEISEL: To Slash 13% of Workforce First Half This Month
--------------------------------------------------------------
Thomas Weisel Partners Group, Inc., will reduce employee headcount
by 13% during the first half of the month.  The move will bring
the firm's total year-to-date reductions to roughly 160 employees
or 22%, leaving the firm with about 600 employees going forward.

The job cuts was announced end of April when Thomas Weisel
released financial results for the quarter ended March 31, 2008.

The firm said it will continue to selectively upgrade its talent
pool within revenue generation areas.

During the first quarter, Thomas Weisel posted a $17.8 million net
loss on $48.9 million net revenues, compared to $3.8 million net
income for the same period in 2007.  Adjusting for certain one-
time events related to its initial public offering and the
amortization of intangible assets it acquired after buying out
Canadian investment bank Westwind Partners in October, the firm
reported a non-GAAP net loss of $14.8 million.

Thomas Weisel also reported that investment banking revenues
decreased to $11.5 million in the first quarter of 2008 compared
to $52.8 million during the same period in 2007.

"The equity capital markets environment in the first quarter of
2008 was extremely challenging, which directly impacted our first
quarter results, said Thomas Weisel, Chairman and CEO.  "At the
beginning of the second quarter, our total backlog of filed,
announced and engaged transactions was up slightly compared to the
beginning of the first quarter of 2008.  However, near term equity
capital market conditions remain difficult and uncertain,
and at this point, we have not experienced material improvements."

"As an alternative to the equity capital markets, several of our
IPO clients are pursuing either a strategic alternative or a
private financing.  M&A continues to be active as evident by our
five recently announced transactions, which include: Saxon Energy
Service's sale to Schlumberger and First Reserve Corporation for
approximately C$590 million, Nuance Communications' $400 million
acquisition of eScription, Iomega's $215 million sale to EMC
Corporation, Frontier Pacific Mining's sale to Eldorado Gold
Corporation for C$157 million and WJ Communications' sale to
TriQuint Semiconductor for $72 million," continued Mr. Weisel.

Thomas Weisel also reported that asset management revenues
decreased to $300,000 in the first quarter of 2008 compared to
$5.7 million in 2007 first quarter.

"[O]ur $3.7 million of management fees were offset by mark-to-
market losses primarily stemming from two public companies held in
our healthcare venture fund, Trans1 and Hansen Medical. These
losses were partially offset by gains experienced in our venture
capital fund of funds and our technology venture   fund," said Mr.
Weisel.

Brokerage revenues increased to $36.1 million in the first quarter
compared to $31.9 million a year ago.

"Growth in our electronic trading platform, the team we hired for
special situations overnight block trading and the opening of new
offices in the midwest and Europe all contributed to the year-
over-year improvements," commented Tony Stais, Director of
Trading.

Thomas Weisel insists it has a strong balance sheet position. At
the end of the first quarter of 2008, Thomas Weisel disclosed,
shareholders' equity and book value per share were $357 million
and $11.04, and tangible shareholders' equity and tangible book
value per share were $240 million and $7.40.

"Over the course of the year, we expect our available cash and net
short term assets to be approximately $150 million, of which
approximately $100 million is currently used to capitalize our
broker-dealer entities, said Lionel F. Conacher, Thomas Weisel's
President and Chief Operating Officer.  "By right-sizing our firm,
combined with our healthy balance sheet and strategic new hires,
we are positioning ourselves to fully leverage our diversified
platform when stability returns to the capital markets
environment," Mr. Conacher said.

Financial News-US notes that Thomas Weisel's rival Greenhill & Co.
reported that net profit for the quarter ended March 31 rose to
$19.2 million compared to $8.7 million in the same period last
year.  Financial advisory revenues nearly doubled to $69.5 million
from $36.3 million a year ago for Greenhill.

Financial News-US quotes Scott Bok, co-chief executive at
Greenhill, as saying: "Many of our competitors are focused on
extraordinary challenges that do not affect us. Clients are
increasingly likely to seek a truly independent advisor to assist
them in a more challenging environment."

Founded in 1998, Thomas Weisel Partners Group, Inc. generates
revenues from three principal sources: investment banking,
brokerage and asset management.  The investment banking group is
comprised of two disciplines: corporate finance and strategic
advisory.  The brokerage group provides equity and convertible
debt securities sales and trading services to institutional
investors, and offers brokerage, advisory and cash management
services to high-net-worth individuals and corporate clients.  The
asset management group consists of: private equity, public equity
and distribution management.

Thomas Weisel Partners is headquartered in San Francisco,
California, with additional offices in Baltimore, Boston, Calgary,
Chicago, Cleveland, Denver, Montreal, New York, Portland, Silicon
Valley, Toronto, London, Mumbai and Zurich.  On the Net:
http://www.tweisel.com/


TOMARCON INC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Tomarcon, Inc.
        dba Ad-Aid Mounting & Die Cutting
        1835 Burnet Ave.
        Union, NJ 07083

Bankruptcy Case No.: 08-17763

Chapter 11 Petition Date: May 29, 2008

Court: District of New Jersey (Newark)

Judge: Donald H. Steckroth

Debtor's Counsel: David H. Stein, Esq.
                  Wilentz, Goldman & Spitzer, P.A.
                  90 Woodbridge Center Dr.
                  P.O. Box 10
                  Woodbridge, NJ 07095
                  Tel: (732) 636-8000
                  Fax: (732) 855-6117
                  Email: dstein@wilentz.com

Total Assets:  $524,463

Total Debts: $1,229,775

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Jiro, Inc.                     Unperfected lien      $940,000
Attn: Ron Berucci              on debtor's assets
7 Kirk Bride Terrace           by former owner,
Towaco, NJ 07082               Jiro, Inc.

Henschel-Steinau, Inc.                               $25,859
Attn: Paul Kapoian
300 Grand Ave.
Englewood, NJ 07631

Burnet Interests               Landlord              $16,412
80 Main St.
West Orange, NJ 07052

Die Knowolgist-Brooklyn Navy                         $11,355
Yard

Travelers CL & Specialty                             $9,992

Bradley Corrugated Box                               $9,775

Donald F. Conway, Trustee      Preferance claim      $9,530

IFS Ind., Inc.                                       $8,777

Flech Paper Products                                 $7,969

Beisler Weidmann                                     $7,143

Schiffenhaus Packaging Corp.                         $3,771

Diversified                                          $2,508

PSE&G                                                $2,179

Mercury Adhesives                                    $1,576

Martin D. Breed                                      $1,522

Amato Landscape Contractors                          $1,482

Holtzman Design                                      $1,450

Duraco, Inc.                                         $1,396

D&D Display Group, LLC                               $1,379

Bestway Trucking                                     $1,352


TORO ABS: Fitch Slashes Rating to CCC from A- on $876.9MM Notes
---------------------------------------------------------------
Fitch has downgraded and removed from Rating Watch Negative six
classes of notes issued by Toro ABS CDO II, Ltd./LLC.  The rating
actions are effective immediately:

  -- $876,942,425 class A1 notes downgraded to 'CCC' from 'A-';
  -- $55,899,748 class A2 notes downgraded to 'CC' from 'BBB-';
  -- $23,957,035 class B notes downgraded to 'CC' from 'BB';
  -- $6,987,469 class C notes downgraded to 'CC' from 'B';
  -- $9,133,557 class D notes downgraded to 'C' from 'CCC';
  -- $10,181,651 class E notes downgraded to 'C' from 'CC';
  -- $4,226,371 class F notes remain at 'C';

Toro II is a collateralized debt obligation that closed on
April 27, 2006.  The initial portfolio was selected by Merrill
Lynch Investment Managers and is currently managed by BlackRock
Inc. Toro's substitution period will end in June 2009.  Toro has a
portfolio comprised primarily of subprime residential mortgage-
backed securities bonds 54.56%, Alternative-A RMBS 15.32%, prime
RMBS 14.81%, structured finance CDOs 14.60% and other structured
finance assets.  Subprime RMBS bonds of the 2005 and 2006 vintages
account for approximately 35.12% and 19.29% of the portfolio,
respectively.  Likewise, the SF CDO exposure includes 4.05 %
originated in 2005 and 8.97% originated in 2006.  Alt-A RMBS
represents approximately 15.32% of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS, and SF CDOs with underlying exposure to subprime RMBS.  
Since November 2007, approximately 43.60% of the portfolio has
been downgraded with 17.98% of the portfolio currently on Rating
Watch Negative.  Actual credit deterioration exceeds the level of
downgrades that Fitch assumed in November 2007.  Whereby currently
31.57% of the assets in the portfolio now carry a rating below the
rating it assumed in November 2007.

The ratings of the class A-1, A-2, B and C notes address the
likelihood that investors will receive full and timely payments of
interest, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.  
The ratings of the class D, E and F notes address the likelihood
that investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


TORO ABS: Fitch Chips BBB Rating to C and Removes Negative Watch
----------------------------------------------------------------
Fitch has downgraded three classes of notes issued by TORO ABS CDO
I, Ltd. and two classes of notes remain on Rating Watch Negative.   
The rating actions are effective immediately:

  -- $864,771,710 class A notes downgraded to 'B' from 'AAA' and
     remain on Rating Watch Negative;

  -- $73,433,128 class B notes downgraded to 'CC' from 'AA' and
     removed from Rating Watch Negative;

  -- $14,493,381 class C notes downgraded to 'C' from 'BBB' and
     removed from Rating Watch Negative.

TORO I is a collateralized debt obligation that closed on June 30,
2005.  The initial portfolio was selected by Merrill Lynch
Investment Management and is currently managed by BlackRock Inc.
TORO I's substitution period ended in November 2007.  TORO I has a
portfolio comprised primarily of subprime residential mortgage-
backed securities bonds (45.9%), SF CDOs (25.1%), prime RMBS
(15.2%), and Alternative-A RMBS (13.8%).  Subprime RMBS bonds of
the 2005 and 2006 vintages account for approximately 34.8% and
0.2% of the portfolio, respectively.  Likewise, the SF CDO
exposure includes SF CDOs originated in 2004 (15.0%) and 2005
(10.1%).  Alt-A RMBS bonds of the 2005, 2006 and 2007 vintages
represent approximately 11.7% of the portfolio.

Fitch's rating actions reflect the significant collateral
deterioration within the portfolio, specifically subprime RMBS,
Alt-A RMBS, and structured finance CDOs with underlying exposure
to subprime RMBS.  Since the beginning of 2007, approximately
45.3% of the portfolio has been downgraded, with 21.7% of the
portfolio currently on RWN.  The negative credit migration is
primarily attributable to credit deterioration in subprime RMBS
bonds from the 2005, 2006 and 2007 vintages, coupled with
significant downgrades in SF CDOs originated in 2004 and 2005.

Additionally, due to the significant amount of collateral
deterioration in the portfolio the class A/B overcollateralization  
ratio and the class C OC ratio were both failing their required
test levels as of the March 31, 2008 trustee report.

The Rating Watch Negative reflects the continued credit
deterioration in subprime RMBS and SF CDOs with underlying
exposure to subprime RMBS, as well as growing concerns with the
performance of Alt-A RMBS.  Additionally, Fitch is reviewing its
SF CDO approach and will comment separately on any changes and
potential rating impact at a later date.

The ratings of the class A and class B notes address the
likelihood that investors will receive full and timely payments of
interest, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.  
The rating of the class C notes addresses the likelihood that
investors will receive ultimate and compensating interest
payments, as per the transaction's governing documents, as well as
the stated balance of principal by the legal final maturity date.


TOWERS OF CHANNELSIDE: Court Approves Disclosure Statement
----------------------------------------------------------
The Honorable K. Rodney May of the U.S. Bankruptcy Court for the
Middle District of Florida approved the disclosure statement
explaining The Towers of Channelside, LLC's plan of
reorganization.

The Court held that the Disclosure Statement contains adequate
information within the meaning of Sec. 1125 of the Bankruptcy
Code.

                       Overview of the Plan

The Plan creates a mechanism for the sale of units, the funding of
ongoing operating expenses, and the payment of creditor claims.  
This is accomplished by creating a "waterfall" for the
distribution of net sales proceeds between creditor constituencies
after ensuring that post-confirmation operating expenses,
including interest to Wachovia Bank, National Association, and
certain secured and priority claims are adequately funded and
paid.  Under this approach, two secured creditors, Batson-Cook of
Tampa Inc. and CIT Technology Financing Services Inc., will be
paid deferred amounts in full settlement of their allowed secured
claims.

Wachovia's secured claims is projected to be paid from funds
derived from the sale of units.  After Wachovia has been paid in
full, unsecured creditors will receive remaining funds until they
are paid the allowed amount of their claims in full or until all
units are sold.  Management will receive fixed and incentive
compensation to ensure their continued service and to motivate
them to achieve the highest possible payment level to all
creditors.

                      Treatment of Claims

All Administrative and Priority Claims will be fully paid.

The Secured Claim of Wachovia, totaling, $56 million, will be paid
the allowed amount of its secured claim plus monthly interest
payments of 5% per annum on the principal balance remaining unpaid
from time to time.  Said interest payments will begin on the first
day of the month following the effective date and will continue on
the first day of each month until the Wachovia's claim will be
paid in full.

The Secured Claim of Batson-Cook, totaling $1,285,257, for
services performed and materials provided, will be paid in four
installments:

   1) $500,000 within three business days of the effective date;

   2) $200,000 on Dec. 31, 2008;

   3) $300,000 on March 30, 2009;

   4) $285,257 on June 30, 2009.

The Secured Claim of CIT will be paid through 12 monthly payments
of $200 plus monthly interest at 5% per annum, starting on the
effective date and continuing on the same day of each succeeding
month.

The allowed secured claims of the disputed deposit claimants,
totaling $2 million, will be paid in whole or in part, depending
on a settlement or court order.

General unsecured claims will be paid on a pro-rata basis and will
get cash distributions following the full payment of Wachovia and
Batson-Cook's claims.  The distributions will start upon the full
payment of Wachovia's claim and will continue on a periodic basis
until the allowed unsecured claims be paid in full or until all
assets liquidated and collected.  

Equity holders will receive nothing under the Plan.

                   About Towers of Channelside

Based in Plant City, Florida, the Towers of Channelside, LLC --
http://www.towersatchannelside.com/-- operates a 29-story twin       
tower condominium overlooking the Tampa Bay area.  The developer
filed for Chapter 11 protection on Jan. 25, 2008 (Bankr. M.D. Fla.
Case No. 08-00939).  Edward J. Peterson, III, Esq. and Harley E.
Riedel, Esq., at Stichter Riedel Blain & Prosser P.A., represents
the Debtor in its restructuring efforts.  The Official Committee
of Unsecured Creditors appointed in this bankruptcy case has
selected Forizs & Dogali, P.L. as its counsel.

As reported in the Troubled Company Reporter on March 4, 2008, the
Debtor's schedules showed total assets of $109,783,667 and total
debts of $94,258,253.


TOWERS OF CHANNELSIDE: Plan Confirmation Hearing Set for May 28
---------------------------------------------------------------
The Hon. K. Rodney May of the U.S. Bankruptcy Court for the Middle
District of Florida set a hearing to confirm The Towers of
Channelside, LLC's plan of reorganization on May 28, 2008, at 3:00
p.m. in Courtroom 9B, United States Bankruptcy Court, 801 North
Florida Avenue, in Tampa, Florida.

Based in Plant City, Florida, the Towers of Channelside, LLC --
http://www.towersatchannelside.com/-- operates a 29-story twin       
tower condominium overlooking the Tampa Bay area.  The developer
filed for Chapter 11 protection on Jan. 25, 2008 (Bankr. M.D. Fla.
Case No. 08-00939).  Edward J. Peterson, III, Esq. and Harley E.
Riedel, Esq., at Stichter Riedel Blain & Prosser P.A., represents
the Debtor in its restructuring efforts.  The Official Committee
of Unsecured Creditors appointed in this bankruptcy case has
selected Forizs & Dogali, P.L. as its counsel.

As reported in the Troubled Company Reporter on March 4, 2008, the
Debtor's schedules showed total assets of $109,783,667 and total
debts of $94,258,253.


TRIAD GUARANTY: Planned Mortgage Unit Cues Fitch to Lower Ratings
-----------------------------------------------------------------
Fitch Ratings has downgraded the ratings on Triad Guaranty Inc.
and its mortgage insurance subsidiary Triad Guaranty Insurance
Corporation as:

Triad Guaranty Insurance Corporation
  -- Insurer financial strength to 'BB' from 'BBB-'.

Triad Guaranty Inc.
  -- Long-term Issuer to 'CCC' from 'BB-'.
  -- $35 million 7.9% fixed coupon senior notes due Jan.15, 2028
     to 'CCC/RR4' from 'BB-'.

The affected ratings remain on Rating Watch Negative, where they
were originally placed on Oct. 25, 2007 by Fitch.

This action follows the announcement by Triad Guaranty that it may
plan to start up a new monoline mortgage insurance company with a
group of investors led by Lightyear Capital LLC, and that if the
plan is executed, that it would place Triad Guaranty Insurance
Corporation into voluntary runoff.

Without the prospects of profitable future business to offset the
likely increase in losses created by the 2006 and 2007 vintage
years, or a meaningful capital infusion, Fitch believes that
Triad's margin of safety to meet policyholder obligations could
become pressured if delinquency and loss development continue at a
sustained pace.  Additional concerns include Triad's Option-ARM
portfolio which represented over 12% of the company's insurance in
force as of year-end 2007 and the performance trends of the 2007
vintage, a significant portion of which was made up of loans with
loan-to-value ratios of 95% or greater.  The 2007 vintage is
currently exhibiting delinquencies trends that are materially
higher than the troubled 2006 vintage for Triad and the rest of
the U.S. mortgage insurers.  As such, Fitch believes that Triad's
current level of capitalization and overall financial profile are
now consistent with a non-investment grade IFS rating.

The rating action also recognizes that even if the new company is
not formed, Fitch believes it is highly likely that Triad will be
placed into runoff, as the company appears to be unable to attract
new capital.  Positively, Fitch believes that if the new mortgage
insurance company is formed, its potential ability to assist in
the provision of administrative services to Triad may support a
more orderly runoff.

With the prospects of Triad being placed in run-off, it will be
much more difficult for Triad to continue to make dividend
payments to Triad Guaranty in order to support holding company
level debt service.  Given this, Fitch has lowered Triad
Guaranty's senior debt rating to 'CCC', implying that default is a
real possibility.  Consistent with its practice for low non-
investment grade debt ratings, The Recovery Rating of 'RR4' on
Triad Guaranty's debt obligations indicates that the recovery
prospects of Triad's Guaranty's senior debt would be influenced by
actual loss development at the operating company and regulatory
restrictions on cash flows between the operating and holding
company.

Triad Guaranty is a holding company that provides private mortgage
insurance coverage in the United States through Triad, its wholly
owned subsidiary.  For Dec. 31, 2007, Triad Guaranty reported
consolidated assets under Generally Accepted Accounting Principles
of $1.1 billion and shareholders' equity of approximately
$499 million.


TRIAD GUARANTY: S&P Retains 'BB' Rating Under Negative Watch
------------------------------------------------------------
Standard & Poor's Ratings Services said that all of its ratings on
Triad Guaranty Inc. (BB/Watch Neg/--; TGIC) and TGIC's mortgage
insurance subsidiary, Triad Guaranty Insurance Corp. (BBB/Watch
Neg/--; Triad), remain on CreditWatch with negative implications.  
This follows TGIC's announcement that it has entered into an
exclusive agreement with Lightyear Capital LLC, a private equity
firm, to negotiate agreements that will facilitate the formation
of a new mortgage insurer to be owned by Lightyear.  Lightyear
would purchase some of TGIC's assets, and some employees of TGIC
would join the new company.  TGIC would not have any ownership in
the new company.

Standard & Poor's lowered its ratings on TGIC and Triad on April
3, 2008, because S&P believed operating losses would deplete a
significant portion of Triad's capital base and make it difficult
for Triad to write new business.  At the same time, S&P placed
these ratings on CreditWatch because they may conclude Triad's
claims-paying ability may not be consistent with an investment-
grade rating.  While the announcement by TGIC will increase
Triad's claims-paying resources, it does not alleviate its
concerns regarding Triad's capitalization.  S&P are still in the
process of comparing the firm's current liabilities and potential
losses to its existing resources.


TROPICANA ENTERTAINMENT: Files Chapter 11 Bankruptcy in Delaware
----------------------------------------------------------------
Tropicana Entertainment LLC and nine casinos affiliated with its
subsidiary, Columbia Sussex Corp., filed for Chapter 11 protection
before the U.S. Bankruptcy Court for the District of Delaware, the
Associated Press reports.

Tropicana Entertainment's bankruptcy is the largest corporate
filing of the year, Jeffrey McCracken and Tamara Audi of The Wall
Street Journal say.

The petition excludes the Tropicana casino in Atlantic City, New
Jersey, which is being sold after New Jersey gambling regulators
refused to renew its license, AP relates.  

WSJ relates quoting Scott Butera, president of Tropicana
Entertainment LLC: "The company planned to file for bankruptcy by
the end of business on May 5.  The filing is an important step
toward getting the company back on solid financial ground.  I
really view this as a positive step.  The company is cash-flow
positive and in very constructive dialogue with our lending
groups."

Mr. Butera joined the company a month ago with the intent of
restructuring it.  Mr. Butera also led Trump Entertainment Resorts
Inc.'s chapter 11 reorganization, WSJ say.

According to WSJ, citing two people familiar with the matter, on
May 2, Tropicana failed to make an interest payment on a
$1.32 billion loan with Credit Suisse Group.  Sources told WSJ
that Tropicana is not expected to make the payment.

WSJ states that the missed payment terminates a forbearance
agreement the company had with bondholders, putting further
pressure on the gambling company.

Tropicana Entertainment had $2,845,847,596 in total assets and
$2,429,890,642 in total debts as of February 29, 2008.  Tropicana
has $2.67 billion in rated bank and bond debt, according to WSJ,
citing Moody's Investors Service.

The largest previous bankruptcy filing of the year was Quebecor
World Inc., which had rated debt of roughly $1.8 billion,
according to WSJ.
  
WSJ adds that Tropicana bonds, which come due December 2014,
traded around 50 cents on the dollar last week.  

WSJ says that Tropicana has applied for a debtor-in-possession
financing with Silver Point Capital LP, a hedge fund and
investment firm.

Kirkland & Ellis LLP represents Tropicana in their restructuring
efforts and Lazard Ltd. is Tropicana's financial advisor.

Mr. Butera, WSJ states, couldn't specify how long the company
would be in bankruptcy.  The company isn't planning any layoffs,
or planning to sell any of the 11 properties in its portfolio, WSJ
says.

                 About Tropicana Entertainment

Tropicana Entertainment LLC -- http://www.tropicanacasinos.com/--     
is an indirect subsidiary of Tropicana Casinos and Resorts.  The
company is one of the largest privately-held gaming entertainment
providers in the United States.  Tropicana Entertainment owns
eleven casino properties in eight distinct gaming markets with
premier properties in Las Vegas, Nevada and Atlantic City, New
Jersey.


TROPICANA ENTERTAINMENT: Case Summary & 30 Largest Creditors
------------------------------------------------------------
Lead Debtor: Tropicana Entertainment, LLC
             740 Centre View Boulevard
             Crestview Hills, KY 41017

Bankruptcy Case No.: 08-10856

Debtor-affiliates filing separate Chapter 11 petitions but with no
case numbers assigned yet:

        Entity
        ------
        Adamar Garage Corp.
        Adamar of Nevada
        Argosy of Louisiana, Inc.
        Atlantic-Deauville, Inc.
        Aztar Corporation
        Aztar Development Corporation
        Aztar Indiana Gaming Company, LLC
        Aztar Indiana Gaming Corporation
        Aztar Missouri Gaming Corporation
        Aztar Riverboat Holding Company, LLC
        Catfish Queen Partnership in Commendam
        Centroplex Centre Convention Hotel, L.L.C.
        Columbia Properties Laughlin, LLC
        Columbia Properties Tahoe, LLC
        Columbia Properties Vicksburg, LLC
        CP Baton Rouge Casino, L.L.C.
        CP Laughlin Realty LLC
        Hotel Ramada of Nevada
        Jazz Enterprises, Inc.
        JMBS Casino LLC
        Ramada New Jersey Holdings Corporation
        Ramada New Jersey, Inc.
        St. Louis Riverboat Entertainment, Inc.
        Tahoe Horizon, LLC
        Tropicana Development Company, LLC
        Tropicana Enterprises
        Tropicana Entertainment Holdings, LLC
        Tropicana Entertainment Intermediate Holdings, LLC
        Tropicana Express, Inc.
        Tropicana Finance Corp.
        Tropicana Las Vegas Holdings, LLC
        Tropicana Las Vegas Resort and Casino, LLC
        Tropicana Real Estate Company, LLC

Type of Business: The Debtors are privately-held gaming
                  entertainment providers in the US.  See
                  http://www.tropicanalvsales.com/

Chapter 11 Petition Date: May 5, 2008

Court: District of Delaware (Delaware)

Debtors' Counsel: Mark D. Collins, Esq.
                  Email: collins@RLF.com
                  Richards Layton & Finger
                  One Rodney Square, P.O. Box 551
                  Wilmington, DE 19899
                  Tel: (302) 651-7700
                  Fax: (302) 651-7701
                  http://www.RLF.com/

Debtors' Consolidated Financial Condition as of February 29, 2008:

Total Assets: $2,845,847,596

Total Debts:  $2,429,890,642

Debtors' 30 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Wilmington Trust Co. (as       Notes                 $995,676,667
successor indenture trustee
for the 9-5/8% Senior
Subordinated Notes due 2014 )
Attn: Patrick J. Healy
Rodney Square North
1100 North Market St.
Wilmington, DE 19890
Tel: (212) 750-6474
Fax: (212) 750-1361
                                                                                                      
2
Park Cattle Co.                Settlement            $125,000,000
1300 Buckeye Rd. Ste. A
Minden, NV 89423
Tel: (775) 782-2144
Fax: (775) 588-0408

Mapp Construction              Trade                 $3,041,955
344 Third St.
Baton Rouge, LA 70801
Tel: (225) 757-0111
Fax: (225) 757-0480

US Foodservice, Inc.           Trade                 $881,587
3682 Collections Center Dr.
Chicago, IL 60693
Tel: (312) 733-6050
Fax: (312) 733-0738

IGT                            Trade                 $358,267
9295 Prototype Dr.
Reno, NV 89521
Tel: (775) 448-7777
Fax: (775) 448-0719

Bally Gaming, Inc.             Trade                 $308,018
6601 S. Bermuda Rd.
Las Vegas, NV 89119
Tel: (702) 896-7860
Fax: (702) 896-7860

Sierra Pacific Power Co.       Utility               $306,608
875 East Long St.
Carson City, NV 89701
Tel: (800) 782-2506
Fax: (775) 834-4202

Mission Industries             Trade                 $229,342


NV MegaJackpots                Trade                 $223,007


Marcor Remediation, Inc.       Trade                 $219,427

CSG Direct, Inc.               Trade                 $157,979

Wes Design & Supply Co., Ltd.  Trade                 $146,707

Jamestown Metal Marine Sales   Trade                 $132,876

WMS Gaming, Inc.               Trade                 $118,229

Diane Allen and Associates     Trade                 $117,388

Outwest Meat Co.               Trade                 $102,127

Wilkes Group                   Trade                 $101,091
                                                             
Lamar Cos.                     Trade                 $88,119

Fixture Dimensions, Inc.       Trade                 $88,084

Gaming Support                 Trade                 $83,643

Agilysys NV LLC                Trade                 $79,267

Briggs Electric, Inc.          Trade                 $78,236

Mayer Brown LLP                Trade                 $72,062

Micros Systems, Inc.           Trade                 $71,094

HMR Enterprises, Inc.          Trade                 $65,823

Oswald Promotions              Trade                 $64,989

Vail Resorts, Inc.             Trade                 $61,800

Shuffle Master, Inc.           Trade                 $60,396

Protiviti, Inc.                Trade                 $59,287

News West Publishing Co.       Trade                 $56,877


UAL CORPORATION: ReGen Insists Cure Amount Worth $4,272,555
-----------------------------------------------------------
ReGen Capital I, Inc., holds a cure claim against UAL Corporation
and its debtor-affiliates -- Claim No. 45042 -- as assignee of
AT&T Corp., which was party to 10 executory contracts that the
Debtors assumed under their confirmed Plan of Reorganization.

The Debtors have already stipulated to the allowed amount of the
Claim before they sought to assume the 10 contracts with AT&T,
but they never stated what amount they would have to pay in
connection with their assumption of the 10 executory contracts,
ReGen's attorney, Peter J. Roberts, Esq., at Shaw Gussis Fishman
Glantz Wolfson & Towbin LLC, in Chicago, Illinois, relates.

The Debtors seem to have tried to avoid specifying that amount or
paying the claim as a Cure Claim, Mr. Roberts says.  Notably,
there is no indication that the Debtors obtained services from
AT&T except by and through the contracts that they had entered
into with AT&T, Mr. Roberts tells the U.S. Bankruptcy Court for
the Northern District of Illinois.

ReGen determined the Claim's cure amount to be $4,272,555, by
subtracting the value -- as of the distribution date -- of new
common stock of UAL Corporation which ReGen had received --
$626,172 -- from the total amount owed by the Debtors under Claim
No. 43490, as reduced and fixed by a Court-order dated July 20,
2005.

For nearly two years after its submission, the Debtors neither
responded nor objected to the Cure Claim, nor did they purport to
pay any cure for the assumed contracts, while they presumably
have enjoyed its benefits, Mr. Roberts relates.

Subsequently, the Debtors asked the Court to expunge ReGen's Cure
Claim on October 15, 2007, asserting that based on a review of
their books and records, they have no liability on the Cure
Claim, Mr. Roberts notes.

Mr. Roberts states that the Debtors have failed to rebut the
prima facie validity of the Cure Claim with any evidence
whatsoever.  Rather, they simply stated that the Cure Claim
should be expunged, Mr. Roberts points out.  

Accordingly, the Claim held by AT&T and assigned to ReGen must be
paid, Mr. Roberts asserts.  Alternatively, ReGen asks that a
hearing on the Debtors' Objection to its Cure Claim be adjourned
pending ReGen's taking discovery from the Debtors as to what
amounts they owed AT&T under the Assumed Contracts.

                       About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United    
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.  Judge
Wedoff confirmed the Debtors' Second Amended Plan on
Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.  (United Airlines Bankruptcy News, Issue No. 156,
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.


UAL CORPORATION: Union Workers Denounce New Incentive Plan
----------------------------------------------------------
United Airlines, Inc.'s union workers are unhappy with
management's plan to set aside 8,000,000 shares of United stock
worth $130,000,000 to fund the new incentive program for company
executives, Julie Johnsson of the Chicago Tribune reports.

"It's just another money grab," said Greg Davidowitch, leader of
United's flight attendants union, reports Ms. Johnsson.  "To
propose something like this is completely outrageous and can only
serve to further erode the already tenuous relationship between
flight attendants and management."

The report says United wants to replace the original plan, which
expires next year, and needs more shares to do so since that plan
is tapped out.

"The new incentive plan's 8 million shares will provide the
company the opportunity to make awards over the next three to
five years, enabling us to attract, retain and reward exceptional
senior leaders," United spokeswoman Jean Medina said, according
to the report.

Experts are baffled over United's timing of its announcement of
the incentive plan since it is still in merger talks with US
Airways Group Inc., Ms. Johnsson relates.  Experts note that a
controversy over the new incentives would probably alienate
workers, whose cooperation is highly critical in achieving a
smooth consolidation.

"You've seen what employees who are at war with their employers
can do," Robert Mann, president of R.W. Mann & Co. said.  "It
usually means that customers end up as collateral damage."

                       About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United    
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.  Judge
Wedoff confirmed the Debtors' Second Amended Plan on
Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.  (United Airlines Bankruptcy News, Issue No. 156,
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.


US AIRWAYS: Incurs $236 Million Net Loss in First Quarter 2008
--------------------------------------------------------------
US Airways Group, Inc. reported a net loss for its first quarter
2008 of $236 million, or ($2.56) per share, compared to a net
profit of $66 million, or $0.70 per diluted share for the same
period last year.  Excluding net special items of $3 million, the
company reported a net loss of $239 million, or ($2.60) per share
for its first quarter 2008.  This compares to a net profit
excluding special items of $34 million, or $0.37 per diluted share
for the first quarter of 2007, which included $32 million of net
special credits.

US Airways Group Chairman and CEO Doug Parker stated, "Our first
quarter results reflect the extremely high fuel prices that are
affecting our entire industry.  The large losses posted by U.S.
airlines this quarter, the forecast for further losses and the
recent liquidations and bankruptcies of a number of carriers,
indicate quite clearly that the U.S. airline industry is in
financial turmoil.

"Fortunately, US Airways has taken steps to prepare for this
environment.  We have a solid balance sheet with significant cash
on hand, minimal debt payments through 2013, and our employees
have made extraordinary progress in our operational improvement
plan.  As we move forward, we are continuing to keep capacity in
check, exploring opportunities to generate additional sources of
revenue, modifying our pricing structure, and reducing our
capital expenditures," continued Mr. Parker.

                             Liquidity

As of March 31, 2008, the company had $2.8 billion in total cash
and investments, of which $2.4 billion was unrestricted.  In
April, the company entered into an amended agreement with Chase
Bank for processing certain credit card transactions.  The
amendment extends the term of the agreement, reduces pricing, and
adjusts the payment terms related to processing fees.  The
amendment also includes a decrease in the level of collateral
required to be maintained by the company, measured as a
percentage of outstanding air traffic liability, to the company's
level of reserve at March 31, 2008 and in certain circumstances
further reductions in that level of collateral requirements.  The
Company expects $67 million to be released from the reserve
account by April 30, 2008 due to the reduced reserve requirements.

"We spent the last few years improving our liquidity position to
decrease our vulnerability to adverse economic and industry
conditions.  We have a strong relative liquidity position versus
our peers and as a result of financing transactions completed
since the merger, we do not have any material debt payments
through 2013," continued Chief Financial Officer Derek Kerr.

To preserve liquidity US Airways has also reduced its forecasted
capital expenditure plan for 2008 by approximately $75 million
since the beginning of the year.  This brings the total 2008
estimated non-aircraft capital expenditures to $240 million.
The company will continue to invest in its previously announced
operational improvement plan.

As of March 31, 2008, the company had total assets of
$$8.2 billion, total liabilities of $7.1 billion, and total
stockholders' equity of $1.1 billion.

                   First Quarter Special Items

During its first quarter, the company recognized $3 million of
net special items.  These special items included expenses of
$26 million in merger related transition costs, a $13 million
impairment loss considered to be other than temporary on certain
available for sale auction rate securities, and $2 million in
write-off of debt discount and debt issuance costs in connection
with the refinancing of certain aircraft equipment notes.  These
expenses were offset by a $36 million non-cash unrealized net
gain associated with the change in fair value of the company's
outstanding fuel hedge contracts and an $8 million gain on the
forgiveness of debt.

A full-text copy of the company's first quarter 2008 results on
Form 10-Q is available for free at:

               http://ResearchArchives.com/t/s?2b7b

                         About US Airways

Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.

Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.,
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas
M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in
their restructuring efforts.  In the Company's second bankruptcy
filing, it lists $8,805,972,000 in total assets and $8,702,437,000
in total debts.

The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005.  The Debtors completed their
merger with America West on the same date.  (US Airways Bankruptcy
News, Issue No. 158; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 26, 2008,
Standard & Poor's Ratings Services revised its outlook on US
Airways Group Inc. to stable from positive.  S&P has affirmed all
ratings, including the 'B-' long-term corporate credit rating.

The TCR reported on April 17, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1'; and
Senior unsecured rating at 'CCC/RR6'.  Fitch's ratings apply to
approximately $1.7 billion in outstanding debt.  The Rating
Outlook has been revised to Stable from Positive.


U.S. ENERGY: Wants Court to Set July 1 as Claims Bar Date
---------------------------------------------------------
U.S. Energy Systems Inc. and its debtor-affiliates ask the Hon.
Robert D. Drain of the United States Bankruptcy Court for the
Southern District of New York to establish July 1, 2008, as
deadline for creditors can file proofs of claim.

The Debtors propose July 7, 2008, as claims bar date for
governmental units holding claims arising before the Debtors'
bankruptcy filing.

All original proofs of claim must be delivered to Epiq bankruptcy
Solutions LLC, claims agent of the Debtors.

A hearing is set on Wednesday May 7, 2008, at 10:00 p.m., to
consider for approval of the Debtors' request.

                       About U.S. Energy

Based in Avon, Connecticut, U.S. Energy Systems Inc. (Pink Sheets:
USEY) --  http://www.usenergysystems.com/-- owns green power
and clean energy and resources.  USEY owns and operates energy
projects in the United States and United Kingdom that generate
electricity, thermal energy and gas production.

The company filed for Chapter 11 protection on Jan. 9, 2008 (Bank.
S.D.N.Y. Case No. 08-10054).  There are 34 affiliates who filed
for separate Chapter 11 petitions.  Peter S. Partee, Esq., at
Hunton & Williams LLP, represents the Debtor in its restructuring
efforts.  Jefferies & Company, Inc. serves as the company's
financial advisor.  The Debtor also selected Epiq Bankruptcy
Solutions LLC as noticing, claims and balloting agent.

The Official Committee of Unsecured Creditors has yet to be
appointed in these cases by the U.S. Trustee for Region 2.  When
the Debtors filed for protection from their creditors, they listed
total assets of $258,200,000 and total debts of $175,300,000.

                           *    *    *

As reported in the reported in the troubled company reporter on
April 22, 2008, the Debtors asked the Court to further extend the
exclusive period to file a Chapter 11 plan until July 8, 2008.


VERTIS INC: Inks Forbearance Agreement with Senior Noteholders
--------------------------------------------------------------
Vertis Inc. disclosed that pursuant to a forbearance agreement,
dated April 30, 2008, the holders of an aggregate of 77% of the
outstanding principal amount of the Second Lien Notes agreed to:

   -- forbear from exercising their rights and remedies under the
      indenture governing the Second Lien Notes; and

   -- from directing the trustee under the indenture from
      exercising any rights and remedies on the holders' behalf,

until the occurrence of any of these events:

   (i) the failure of a specified percentage of certain note
       holders having executed a restructuring and lock-up
       agreement on or before May 13, 2008,

  (ii) the termination of the Restructuring Agreement in
       accordance with its terms,

(iii) the occurrence of certain events under the forbearance
       agreement dated April 3, 2008, between the company and the
       lenders under the company's four-year revolving credit
       agreement, as may be amended,

  (iv) the occurrence of certain events under the forbearance
       agreement dated as of April 2, 2008, by and among Vertis
       Receivables II, LLC, Webcraft, LLC, Webcraft Chemicals,
       LLC, Enteron Group, LLC, Vertis Mailing, LLC, the company
       and General Electric Capital Corporation, as may be amended    
       and

   (v) the occurrence of certain other events described in the
       Forbearance Agreement.

As reported in the Troubled Company Reporter on April 11, 2008, as
part of the strategy of the company to preserve and enhance its
near-term liquidity, the company elected to forego making a
$17.1 million interest payment on its 9-3/4% Senior Secured Second
Lien Notes.  Under the terms of the indenture governing the Second
Lien Notes, the company had a thirty-day grace period in which to
make this interest payment before it would be an event of default.

The holders of the Second Lien Notes that are parties to the
Forbearance Agreement also agreed that during the Forbearance
Period they will not sell, pledge or otherwise transfer any Second
Lien Notes except under certain conditions.

Headquartered in Baltimore, Vertis Inc., doing business as Vertis
Communications -- http://www.vertisinc.com/-- is a provider of     
print advertising and direct marketing solutions to America's
leading retail and consumer services companies.  

At Dec. 31, 2007, the company's consolidated balance sheet showed
$528.2 million in total assets and $1.403 billion in total
liabilities, resulting in a $875.1 million total stockholders'
deficit.  

                          *     *     *

As reported in the Troubled Company Reporter on April 4, 2008,
Deloitte & Touche LLP, in Baltimore, Maryland, expressed
substantial doubt about Vertis 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 said that the company has incurred recurring net
losses and is experiencing difficulty in generating sufficient
cash flow to meet its obligations and sustain its operations.

As reported in the Troubled Company Reporter on April 3, 2008,
Standard & Poor's Ratings Services revised its CreditWatch
implications for its 'CC' corporate credit rating on Vertis Inc.   
to negative from developing following the company's announcement
that it had engaged a financial advisor to assist in a possible
debt exchange offering.

At the same time, Standard & Poor's lowered its ratings on
Vertis's $350 million senior secured second-lien notes and
$350 million senior unsecured notes to 'C' from 'CCC'.  The notes
remain on CreditWatch with negative implications, where they were
originally placed on April 4, 2007.


VICORP RESTAURANTS: U.S. Trustee Forms Seven-Member Committee
-------------------------------------------------------------
Kelly Beaudin Stapleton, U.S. Trustee for Region 3, appointed
seven members to the Official Committee of Unsecured Creditors of  
VICORP Restaurants Inc. and its debtor-affiliate, VI Acquisition
Corp.  The members of the Committee are:

   1. Wilmington Trust Company, as Indenture Trustee
      Attn: James J. McGinley
      1100 North Market Street, Rodney Square North
      Wilmington, DE 19890
      Tel: 212-415-0522
      Fax: 212-415-0513

   2. Sankaty Credit Opportunities II, L.P.
      Attn: Nathan Gilliland
      111 Huntington Ave., 35th Floor
      Boston, MA 02199
      Tel: 617-516-2802
      Fax: 617-516-2710

   3. Newport Global Opportunity Fund, L.P.
      Attn: Ryan L. Langdon
      21 Waterway Avenue, #150
      The Woodlands, TX 77380
      Tel: 713-559-7400
      Fax: 713-559-7499

   4. Fidelity National Special Opportunities, Inc.
      Attn: Joseph J. Farricielli, Jr.
      4050 Calle Real, Ste. 210
      Santa Barbara, CA 93110
      Tel: 805-696-7349
      Fax: 805-696-7311

   5. U.S. Foodservice, Inc.
      Attn: Claudia G. Regen
      9755 Patuxent Woods Drive
      Columbia, MD 21046
      Tel: 443-259-2099
      Fax: 410-910-3159

   6. The Coca-Cola Company
      Attn: John Lewis, Jr.
      One Coca-Cola Plaza
      Atlanta, GA 30313
      Tel: 404-676-4016

   7. Realty Income Corporation
      Attn: Michael R. Pfeiffer
      600 La Terraza Blvd.
      Escondido, CA 92025
      Tel: 760-317-2961
      Fax: 760-741-2235

Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtors' expense.  They may investigate the Debtors' business and
financial affairs.  Importantly, official committees serve as
fiduciaries to the general population of creditors they represent.  
Those committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

                    About VICORP Restaurants

Based in Denver, Colorado, VICORP Restaurants Inc. --
http://www.vicorpinc.com/-- operates two restaurant concepts    
under proven and well-recognized brands, Village Inn and Bakers
Square.  Founded in 1958, VICORP has 343 restaurants in 25 states,
consisting of 250 company-operated restaurants and 93 franchised
restaurants.  Known for its strong breakfast heritage, Village Inn
has been serving its signature breakfast items like one-of-a-kind
skillet dishes and made-from-scratch pancakes for 50 years. In
addition, Village Inn offers traditional American fare for lunch
and dinner.

The company and its affiliates filed for Chapter 11 protection on
April 3, 2008 (Bankr. D. Del. Lead Case No. 08-10623).  Donna L.
Culver, Esq., at Morris Nichols Arsht & Tunnell, and Kimberly
Ellen Connolly Lawson, Esq., Kurt F. Gwynne, Esq., and Richard A.
Robinson, Esq., at Reed Smith LLP, represents the Debtors in their
restructuring efforts.  The Debtors chose Wells Fargo Trumbull as
their claims, noticing, and balloting agent.

When the Debtors filed for protection from their creditors, they
listed estimated assets and debts of $100 million to $500 million.


VILLAGE HOTEL: Gets Interim OK to Use Lender's Cash Collateral
--------------------------------------------------------------
The United States Bankruptcy Court for the District of Nevada gave
Village Hotel Investors LLC and Village Hotel Holdings LLC interim
permission to use their lender's cash collateral.

Before filing for bankruptcy, the Debtors entered into a take-out
mortgage loan together with a secured credit agreement or deed of
trust with German American Capital Corporation dated Sept. 23,
2003, under which Village Hotel Investors serves as borrower,  
First American Title Company of Nevada as trustee, and Bank One NA
as clearing bank.

As of April 2008, the Debtors' books and records indicate it owed
German American Capital at least $104,000,000 under the secured
credit agreement.  Substantially of all of the Debtors' real and
personal property and other assets secure the loan.

The Debtors was in default on the secured credit agreement prior
to the bankruptcy filing on April 1, 2008.

                        About Village Hotel

Headquartered in Henderson, Nevada, Village Hotel Investors LLC,
aka Ritz Carlton, Lake Las Vegas Resort, and its affilate Village
Hotel Holdings LLC -- http://www.ritzcarlton.com/-- own the AAA  
Four Diamond Ritz Carlton Lake Las Vegas, a Mediterranean-style
resort nestled in the midst of Southern Nevada desert and mountain
landscape.  The Debtors filed for chapter 11 protection on April
1, 2008 (Bankr. D. Nev. Case No. 08-13043 and 08-13044).  Rob
Charles, Esq., and Brett Axelrod, Esq., at Lewis and Roca LLP
represent the Debtors in their restructuring efforts.  Judge Linda
B. Riegle presides the case.  Village Hotel Investors listed
assets and debts between $100 million and $500 million.


VILLAGE HOTEL: Hires Lewis and Roca as Bankruptcy Counsel
---------------------------------------------------------
Village Hotel Investors LLC and Village Hotel Holdings LLC
obtained authority from the United States Bankruptcy Court for the
District of Nevada to employ Lewis and Roca LLP as its counsel.

Lewis and Roca will, among other things, give the Debtors legal
advice and prepare a plan and disclosure statement related to the
case.

The firm charges $445 per hour for the services of Rob Charles,
Esq., and $440 per hour for the services of Brett Axelrod, Esq.,
partners.  Associate Anne M. Loraditch, Esq., charges at $315 per
hour and associate Micaela Rustia, Esq., charges at $285 per hour.  
Certified legal assistant Marilyn Shoenike charges at $185 per
hour and certified bankruptcy paralegal Pat Kois charges at $155
per hour.

According to the motion, the firm searched for information with
respect to its connection with the parties-in-interest in the case
but could not finalize the search because the Debtors have not
completed its schedules of assets and liabilities, and statement
of financial affairs.

The firm may be reached at:

   Lewis and Roca LLP
   3993 Howard Hughes Parkway, Suite 600
   Las Vegas, Nevada 89169
   Tel: (702) 949-8200
   Fax: (702) 949-8398

                         About Village Hotel

Headquartered in Henderson, Nevada, Village Hotel Investors LLC,
aka Ritz Carlton, Lake Las Vegas Resort, and its affilate Village
Hotel Holdings LLC -- http://www.ritzcarlton.com/-- own the AAA  
Four Diamond Ritz Carlton Lake Las Vegas, a Mediterranean-style
resort nestled in the midst of Southern Nevada desert and mountain
landscape.  The Debtors filed for chapter 11 protection on April
1, 2008 (Bankr. D. Nev. Case No. 08-13043 and 08-13044).  Judge
Linda B. Riegle presides the case.  Village Hotel Investors listed
assets and debts between $100 million and $500 million.


WELLCARE HEALTH: S&P Retains 'B+' Credit Rating Under Neg. Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services said that its 'B+' counterparty
credit rating on WellCare Health Plans Inc. remains on
CreditWatch, where it was placed on Oct. 25, 2007, with negative
implications.

S&P placed the rating on CreditWatch in connection with an
investigation initiated by the U.S. Federal Bureau of
Investigation, the U.S. Department of Health and Human Service
Office of Inspector General, and the Florida attorney general's
Medicaid Fraud Control unit.  The company has since been named in
various class-action complaints and a whistleblower lawsuit
(currently under seal), and it is dealing with various requests
for information from the SEC and state regulatory authorities.  In
response to the investigation, the company has formed a special
committee of the board of directors to conduct an independent
investigation and to develop and recommend any needed remedial
measures.
     
On Jan. 29, 2008, S&P lowered the rating to 'B+' from 'BB-' in
connection with the resignation of three top executives, which
constituted a material disruption to the company's organizational
structure that could lead to diminished near-term operational
flexibility.  To date, the CFO position remains unfilled through
subsequent new-hire activity.
      
"We continue to view these events as a material adverse
development with possibly meaningful downside consequences for the
company's credit profile," noted Standard & Poor's credit analyst
Joseph Marinucci.  WellCare has not been advised of the subject
matter of the investigation and has not yet filed its 10-Q or 10-K
for the periods ended Sept. 30, 2007, and Dec. 31, 2007,
respectively.  However, S&P believe that risk associated with
WellCare's business profile has been partly mitigated by first-
quarter 2008 news of contract renewals and service-area expansion,
which removes some of the uncertainty regarding marketplace
sustainability and financial development.
     
The rating is on CreditWatch negative to reflect the potential
impact of sustained business and financial profile challenges,
which could further pressure the company's credit profile.  Areas
of concern include ongoing uncertainty about the scope of the
investigation and the potential for contract rescission.  "If
WellCare were to lose its ability to conduct business in certain
core markets or become financially distressed in connection with
developments related to the investigation, we could lower the
ratings again," Mr. Marinucci said.


WESTAR ENERGY: Fitch Retains 'BB+' Rating Under Positive Watch
--------------------------------------------------------------
Fitch has assigned a 'BBB' rating to the anticipated $150 million
issuance of Kansas Gas & Electric's first mortgage bonds and
simultaneously placed the FMBs on Rating Watch Positive.  Westar
(IDR 'BB+') and subsidiary KGE (IDR 'BB+') remain on Rating Watch
Positive, where they were placed on June 12, 2007.

KG&E is a wholly-owned subsidiary of Westar Energy.  Fitch expects
the proceeds from the secured debt offering be used to repay
short-term debt and for general corporate purposes.


WIREFREE PARTNERS: S&P Cuts Lease-Backed Notes Rating to BB
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
personal communication services spectrum lease-backed notes issued
by Wirefree Partners III LLC's series 2005-1 to 'BB' from
'BBB-'and removed it from CreditWatch, where it was placed
with negative implications on March 3, 2008.  The outlook is
stable.
     
The lowered rating and outlook assignment follow the May 1, 2008,
lowering of the rating on Sprint Nextel Corp. (BB/Stable/NR). The
actions were based on Standard & Poor's assessment that Sprint
Nextel's business risk profile no longer supports  an investment-
grade rating given the company's deteriorating operating
performance and lack of visibility in the wireless business, along
with its increased financial leverage, due largely to declining
EBITDA.  
     
The rating assigned to Wirefree's $138.5 million PCS spectrum
lease-backed notes series 2005-1 due 2019 reflects the credit
quality of the two lessees, WirelessCo L.P. and SprintCom Inc.,
both of which are wholly owned subsidiaries of Sprint Nextel Corp.  
Through the November 2007 annual distribution date, the Wirefree
transaction has paid down the notes according to its scheduled
principal distribution amounts.  The current outstanding note
balance is $121,234,332.


WOLVERINE TUBE: Appoints William Evans to Board & Audit Committee
-----------------------------------------------------------------
Wolverine Tube Inc. appointed William Evans to its board of
directors.  Mr. Evans was also named chairman of its board audit
committee effective April 8, 2008.

"We welcome [Mr.] Evans' appointment to Wolverine's board of
directors and as chairman of its audit committee," Steven S.
Elbaum, chairman, stated.  [Mr. Evan's] combination of financial,
accounting and overall business experience strengthens Wolverine's
board and underscores Wolverine's commitment to sound and best
practices at an important juncture in the rebuilding of the
company."

"We are grateful to Jack Duncan for assuming the position of
chairman of the audit committee during the last twelve months,"
Mr. Elbaum added.  "Jack will remain a member of the board and
audit committee."

Mr. Evans retired as executive vice president and chief financial
officer of Witness Systems Inc., a public software company based
in Roswell, Georgia.  He started his professional career in 1971
as a CPA with Peat, Marwick, Mitchell & Co. nka KPMG, becoming a
partner in 1980.  He is a member of the president's Council at The
University of Illinois and the Tocqueville Society of the United
Way.

                      About Wolverine Tube

Headquartered in Huntsville, Alabama, Wolverine Tube Inc.
(OTC BB: WLVT) -- http://www.wlv.com/-- is a manufacturer and   
distributor of copper and copper alloy tube, fabricated products,
and metal joining products.  The company currently operates 8
facilities in the United States, Mexico, Canada, China and
Portugal.  The company also has a distribution operation in The
Netherlands.  The company's products enhance performance and
energy efficiency in many applications, including: commercial and
residential heating, ventilation and air conditioning,
refrigeration, home appliances, industrial equipment, power
generation, petrochemicals and chemical processing.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 22, 2007,
Moody's Investors Service confirmed Wolverine Tube's Caa2
corporate family rating, Caa2 probability of default rating, and
Caa3 senior unsecured rating (LGD4, 63%).  The rating outlook was
revised to negative from ratings under review.


* Fitch Says Delinquencies on US Timeshare ABS Receded in 1Q'08
---------------------------------------------------------------
Total delinquencies on U.S. timeshare ABS have receded in the
first quarter this year following an increase that began late in
2007, according to the Fitch Ratings' timeshare ABS index.  The
recent moderation in performance comes despite the significant
challenges faced by borrowers in the current economic environment.

During last year's winter season, timeshare ABS performance
exhibited more dramatic seasonal delinquency and default spikes
than seen in recent years, with total delinquencies reaching 3.82%
in December, the highest level since a steep drop-off beginning in
May 2005.  As a result of the higher seasonal delinquencies,
March's monthly gross defaults reached 0.60%, the highest level
for March since 0.65% in 2004.  January through March performance
data, however, exhibited decreases in the early stage and overall
delinquency rates, indicating that the typical winter
deterioration has begun to recede.

'Though timeshare ABS are often characterized by seasonal
performance deterioration in the winter months, these spikes
exceeded the level of weakening seen in the September through
March period in recent years,' said Director Brad Sohl.  'Thus
far, the trend in delinquencies has mirrored the seasonal spikes
seen in weaker economic environments such as that of 2001-2002.   
While delinquency and default rates have risen higher in the
recent winter season, they remain within Fitch expectations.'

Early-stage delinquencies remain the largest contributor to the
overall delinquency rate, currently representing approximately 44%
of delinquencies, compared to a historical average of 50%.   
Delinquencies in the 60+ and 90+ day buckets currently represent
approximately 28% of the total each, compared to historical
averages of 24% and 26%, respectively.

Fitch's timeshare ABS index is an aggregation of performance
statistics on pools of securitized timeshare loans originated by
various developers.  Expected cumulative gross defaults on
underlying transactions can range from below 10% to above 20%.  
While delinquencies and defaults may vary on an absolute basis,
most transactions supporting the index exhibit similar overall
trends.

Fitch continues to monitor all timeshare ABS in an effort to
provide the market with timely analysis of performance trends.  
The Fitch timeshare performance index summarizes average monthly
delinquency and monthly gross default trends tracked in Fitch's
database of timeshare asset backed securities dating back to
January 1997 and will be available on a quarterly basis.


* Fitch Says Recessionary Pressures Are Among Concerns for Banks
----------------------------------------------------------------
Recessionary pressures within the U.S. economy, outsized exposure
to residential construction loans and home equity loans, and
reduced short-term profitability are among the emerging credit
concerns facing U.S. banks and thrifts that finance trust
preferred securities and subordinated debt through collateralized
debt obligations, according to Fitch Ratings in a new report.

Evidencing these increasing pressures, Fitch has been notified of
the deferral of 11 banks and the default of one bank since
September 2007.  These 12 banks financed $644.5 million in
aggregate TruPS and subordinated debt through 46 Fitch-rated CDOs.  
When taken in combination with pre-existing deferring or defaulted
collateral, including non-bank collateral, average exposure to
deferring and defaulted collateral across these 46 CDOs was 4.9%
of the transactions' respective portfolio balances, and ranged
from a maximum of 15.3% to a minimum of 0.1%.  'Further bank
deferral and default activity is likely given current economic
conditions,' said Senior Director Nathan Flanders.

As a result of observed and expected collateral deterioration
underlying bank TruPS CDOs, Fitch is revising both its Rating and
asset performance Outlook on U.S. bank TruPS CDOs to Negative from
Stable.  Fitch is currently reviewing bank TruPS CDOs with
deferral and/or default exposure or other high-risk exposure and
expects to place materially affected transactions on Rating Watch
Negative in the near future.  'The magnitude of underlying
collateral currently in deferral or default will likely be the
most significant determining factor in Fitch's analysis,' said
Flanders.

However, consideration will also be given to other individual
exposures that Fitch believes are of an increased credit risk due
to recent adverse developments, such as banks facing heightened
regulatory scrutiny, banks which have recently reduced or
eliminated dividends on common equity, or those with an above
average level of exposure to high risk real estate.  Additional
considerations will include available credit enhancement,
prepayments observed to date, obligor concentration, cash flow
redirection mechanisms, and other structural enhancements.


* S&P Downgrades Ratings on Eight Tranches from Three Hybrid CDOs
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on eight
tranches from three U.S. cash flow and hybrid collateralized debt
obligation transactions.  S&P removed three of the lowered ratings
from CreditWatch with negative implications.  The downgraded cash
flow and hybrid tranches have a total issuance amount of
$230.5 million.
     
All of the affected cash flow and hybrid transactions are high-
grade structured finance CDOs of asset-backed securities, which
are CDOs collateralized at origination primarily by 'AAA' through
'A' rated tranches of residential mortgage-backed securities and
other SF securities.
     
At the same time, S&P lowered its rating on one tranche from one
U.S. synthetic CDO transaction and removed it from CreditWatch
with negative implications.  The downgrade of PARCS-R Master
Trust's class 2007-18 variable-rate units reflects the direct link
of the note rating to the rating on its reference obligation, the
class M-2 notes issued by Morgan Stanley ABS Capital I Inc. Trust
Series 2007-NC3, which was lowered to 'BBB' from 'AA' and removed
from CreditWatch with negative implications on May 1, 2008.  The
downgraded synthetic tranche has an issuance amount of $4 million.
     
The CDO downgrades reflect a number of factors, including credit
deterioration and recent negative rating actions on U.S. subprime
RMBS securities, as well as changes Standard & Poor's has made to
the recovery rate and correlation assumptions it uses to assess
U.S. RMBS held within CDO collateral pools.
     
To date, including the CDO tranches listed and including actions
on both publicly and confidentially rated tranches, S&P have
lowered its ratings on 3,372 tranches from 790 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, 583 ratings from 160 transactions are
currently on CreditWatch negative for the same reasons.  In all,
S&P have downgraded $353.005 billion of CDO issuance.  
Additionally, S&P's ratings on $12.110 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
   -----------              -----         --          ----
Broderick CDO 1 Ltd.        A-2           A+          AAA          
Broderick CDO 1 Ltd.        B             BBB         AA/Watch Neg
Broderick CDO 1 Ltd.        C             BB-         BB+/Watch
Neg
Paragon CDO Ltd.            B             AA-         AA  
Paragon CDO Ltd.            C             BBB         A/Watch Neg  
PARCS-R Master Trust
    Series 2007-18          Trust units   BBB         AA/Watch Neg
Reservoir Funding Ltd.      B             A-          AA           
Reservoir Funding Ltd.      C             BBB         A-           
Reservoir Funding Ltd.      D             BB-         BBB          

                     Other Outstanding Ratings

         Transaction                 Class         Rating
         -----------                 -----         ------
         Broderick CDO 1 Ltd.        A-1NVA        AAA             
         Broderick CDO 1 Ltd.        A-1NVB        AAA          
         Broderick CDO 1 Ltd.        A-1V          AAA        
         Paragon CDO Ltd.            Super-senior  AAA     
         Paragon CDO Ltd.            A             AAA         
         Reservoir Funding Ltd.      A-1-NV        AAA       
         Reservoir Funding Ltd.      A-1-V         AAA     
         Reservoir Funding Ltd.      A-2           AAA


* S&P Says Consumer Products Remains Susceptible to Economic Stir
-----------------------------------------------------------------
As of April 15, 2008, the consumer products, media and
entertainment, and retail/restaurants sectors remain most
susceptible to economic and credit-market turbulence, according to
an article published by Standard & Poor's.  The article, which is
titled "Stress In Corporate America: Slowdown Continues To Hinder
Consumer-Reliant Sectors (Premium)," says that these sectors
consistently lead risk in S&P's lists of distressed companies
(speculative-grade companies with securities trading in
excess of 1,000 basis points above U.S. Treasuries), weakest links
(companies rated 'B-' or lower with either a negative outlook or
on CreditWatch with negative implications), and potential bond
downgrades (investment-grade or speculative-grade companies either
a negative outlook or on CreditWatch with negative implications).

S&P identified 232 companies across these sectors on the basis of
these three criteria.

"Weakness in the consumer products, media and entertainment, and
retail/restaurants sectors is a result of U.S. consumers'
diminished economic prospects," said Diane Vazza, head of Standard
& Poor's Global Fixed Income Research Group.  "Consumer spending
is critical to continued economic expansion, as it accounts for
70% of the U.S. GDP."  These cyclical sectors rely heavily on
consumer spending, which has recently declined after showing
resilience in 2007.  S&P expect consumer spending to grow only
1.3% in 2008 (versus .6% forecasted a month ago), a deceleration
compared with 2.9% in 2007 and 3.1% in 2006.


* S&P Reports High-Yield Market Rebounded in Late March to April
----------------------------------------------------------------
The high-yield market rebounded in late March and into April, with
spreads rallying to 685 basis points on April 29 from 802 bps on
March 21, according to an article published by Standard & Poor's.  
The report, titled "U.S. High-Yield Prospects: April Brings High-
Yield Rally," says that volatility has also come down from its
March peak.

"Though the market has calmed, our outlook is fundamentally the
same," said Diane Vazza, head of Standard & Poor's Global Fixed
Income Research Group.  "We continue to expect a deterioration in
credit quality for the high-yield segment.  Downside risk will
remain elevated, with a challenging economic environment putting
pressure on earnings, especially for businesses that rely solely
on the U.S. consumer."

Of the 1,235 parent-level U.S. high-yield issuers rated by
Standard & Poor's Ratings Services on April 16, 2008, S&P have
evaluated the prospects for 1,210 issuers with debt outstanding.  
A study of their CreditWatch and outlook status identifies 116
issuers with a potential for upgrades and 10 potential rising
stars.  Of the total, 32.5% (393) of issuers are at the risk of
downgrade.  Firms in the automotive, consumer products,
homebuilders, and real estate companies, media and entertainment,
insurance, and retail and restaurants sectors remain vulnerable to
relatively high downgrade risk.  Firms in the telecommunications
sector continue to have the greatest potential for upgrades.  The
percentage of issuers with developing risk was 1.82%.
     
Ms. Vazza added, "With only $7.3 billion worth of rated debt
issued in 2008 as of April 21, the high-yield market is off to its
slowest start since 1995.  However, S&P expect to see
broker/dealers unload some high-yield bond debt from 2007, just as
they have done with leveraged loans over the past couple of
months."


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------

                               Total
                               Shareholders    Total     Working
                               Equity          Assets    Capital     
  Company              Ticker  ($MM)           ($MM)      ($MM)
  -------              ------  ------------    ------    -------
Absolute Software       ABT          (3)          83       30
AFC Enterprises         AFCE        (40)         155      (20)
APP Pharmaceutic        APPX        (80)       1,077      214
Ariad Pham              ARIA         (8)         101       65
Bare Escentuals         BARE       (104)         224       84
Blount Intl             BLT         (54)         412      129
CableVision System      CVC      (5,097)       9,141     (607)
Carrols Restaurant      TAST        (13)         463      (29)
Centennial Comm         CYCL     (1,063)       1,343       14
Centerplate-IDS         CVP         (18)         332      (20)
Cheniere Energy         CQP        (228)       1,905      146
Cheniere Energy         LNG         (16)       2,962      428
Choice Hotels           CHH        (157)         328      (42)
Cincinnati Bell         CBB        (668)       2,020        0
Claymont Stell          PLTE        (40)         158       80
Compass Minerals        CMP          (5)         820      201
Corel Corp.             CRE         (14)         266      (15)
Crown Media HL          CRWN       (684)         676        4
CV Therapheutics        CVTX       (185)         259      177
Cyberonics              CYBX        (15)         136      (15)
Deltek Inc              PROJ        (86)         166      (28)
Denny's Corp            DENN       (179)         381       74
Domino's Pizza          DPZ      (1,450)         473       51
Dun & Bradstreet        DNB        (437)       1,659     (192)
Einstein Noah Re        BACL        (34)         149        4
Extendicare Real        EXE-U       (32)       1,440      (15)
Gencorp Inc.            GY          (52)         995       77
General Motors          GM      (35,480)     148,883   (9,720)
Healthsouth Corp.       HLS      (1,070)       2,051     (331)
Human Genome Sci        HGSI        (12)         949       47
ICO Global C-New        ICOG       (131)         602      101
IDEARC Inc              IAR      (8,600)       1,667      205
IMAX Corp               IMAX        (85)         208       (8)
IMAX Corp               IMX         (85)         208       (8)
Incyte Corp             INCY       (160)         276      228
Indevus Pharma          IDEV        (86)         199       40
Intermune Inc           ITMN        (31)         262      209
IPCS Inc                IPCS        (40)         547       76
Knology Inc             KNOL        (35)         619        7
Koppers Holdings        KOP         (14)         669      189
Life Sciences Re        LSR         (29)         502        1
Linear Tech Corp        LLTC       (564)       1,410      912
Lodgenet Interac        LNET        (48)         694        8
Maxxam Inc              MXM        (242)         544      120
Mediacom Comm-A         MCCC       (253)       3,615     (268)
Moody's Corp            MCO        (784)       1,715     (360)
National Cinemed        NCMI       (572)         464       67
Navistar Intl           NAVZ     (1,699)      10,786      164
New Flyer Indust        NFI-U       (23)         907       44
Nexstar Broadcasting    NXST        (89)         709      (11)
NPS Pharm Inc           NPSP       (188)         231      107
Primedia Inc            PRM        (129)         282        6
Protection One          PONE        (23)         673        6
Radnet Inc              RDNT        (53)         434       41
Redwood Trust           RWT        (718)       9,938      N.A.
Regal Entertai-A        RGC        (119)       2,635       (2)
Riviera Holdings        RIV         (48)         218       14
RSC Holdings Inc        RRR         (44)       3,460     (128)
Rural Cellular-A        RCCC       (590)       1,350      110
Sally Beauty Hol        SBH        (745)       1,440      414
Sealy Corp.             ZZ         (113)       1,025       22
Solutia Inc             SOA      (1,449)       2,638     (293)
Sonic Corp              SONC       (102)         765      (27)
Spectrum Brands         SPC        (141)       3,265      828
St John Knits Inc       SJKI        (52)         213       80
Station Casinos         STN        (291)       3,932      (50)
Stelco Inc              STE         (64)       2,657      693
Theravance              THRX        (66)         162      101
UST Inc                 UST        (292)       1,487      446
Valence Tech            VLNC        (61)          20        8
Voyager Learning        VLCY        (53)         917     (637)
Warner Music Gro        WMG         (47)       4,599     (764)
Weight Watchers         WTW        (926)       1,046     (172)
WR Grace & Co.          GRA        (316)       3,869   (1,057)
XM Satellite-A          XMSR       (925)       1,609     (403)
ZIX Corp                ZIXI          0           19       (1)

                             *********

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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